Santa Monica City Council
February 28, 2023

City of Santa Monica
City Council Meeting
AGENDA

GLEAM DAVIS
MAYOR

PHIL BROCK LANA NEGRETE

COUNCILMEMBER MAYOR PRO TEM

CHRISTINE PARRA CAROLINE TOROSIS

COUNCILMEMBER COUNCILMEMBER

JESSE ZWICK OSCAR DE LA TORRE

COUNCILMEMBER COUNCILMEMBER

DAVID WHITE

CITY MANAGER

DOUGLAS SLOAN

CITY ATTORNEY

DENISE ANDERSON-WARREN

CITY CLERK

STANDARDS OF BEHAVIOR THAT PROMOTE CIVILITY AT ALL PUBLIC MEETINGS:
• Treat everyone courteously; • Give open-minded consideration to all viewpoints; • Listen to others respectfully • Focus on the issues and avoid personalizing debate; • Exercise self-control • Embrace respectful disagreement and dissent as democratic rights, inherent components of an inclusive public process, and tools for forging sound decisions
Meetings are broadcast live on CityTV cable channel 16 and on the internet at santamonica.gov. Cable television re-broadcasts air on Thursday and Saturday at 11:30 AM. The agenda will air on CityTV on Saturday and Sunday at 11:00 AM and 6:00 PM, and on Monday and Tuesday at 12:30 PM and 6:00 PM.

City of Santa Monica Generated: 2/27/2023 10:46 AM Page 2

RULES OF ORDER FOR THE CONDUCT OF CITY COUNCIL MEETINGS (Resolution No.11494(CCS))

WAYS TO PROVIDE PUBLIC COMMENT
If you are interested in providing public comment at a City Council meeting, there are several ways to participate:
(1) Written public comment. In lieu of oral public comment, the public is strongly encouraged to submit written public comment on agenda items via email to [email protected]. Written public comment submitted before 12:00 pm on the day of the meeting will be available for online viewing. Please note the agenda item number in the subject line of your written comments. (2) Oral public comment. Persons wishing to address the City Council regarding items on the agenda must be present and submit their name and address (optional) to the City Clerk before the public comment section is opened for that item or before the public hearing is opened where one is required by law. Register to speak at the Speaker Kiosk prior to the meeting. Remarks from the public are limited to a total of 6 minutes per City Council meeting, with a maximum of 2 minutes and a minimum of one minute per item. Except for the author of the request, public comment on 15-items are limited to 1 minute. Except on Public Input, speakers appearing at the meeting in person, may donate 2 minutes to another person present in-person at the meeting, who may speak for a total of 4 minutes on that item.

Both the donor of time and the designated speaker must register at the Speaker Kiosk in person together.

Oral public comment from any one individual is limited to a total of 6 minutes per City Council meeting, with a maximum of 2 minutes per agenda item; under some circumstances, Council may change the maximum to 1 minute per agenda item.

ORDER OF BUSINESS (may not be changed except by majority vote of the City Council.)

1. General Public Input
(members of the public may address the City Council
only on items not on the agenda, but within the
subject matter jurisdiction of the City).

2. Public Comment for Closed Session, Special
Agenda, and Consent Calendar Items Only
(Commendations and Proclamations presented).

3. Closed Session.

4. Special Agenda Items (City Manager’s Report,
Presentations, etc.).

5. Consent Calendar (All items considered in one
motion unless removed by a City Councilmember for
discussion. Public comment shall be heard prior
to City Council discussion).

6. Public Comment on remaining Agenda Items

7. Study Session.

8. Continued Items.

9. Administrative Proceedings.

10. Ordinances:
• 1
st Reading
• 2
nd Reading

11. Staff Administrative Item.

12. Public Hearings.

13. Reports of Boards and Commissions.

14. Resolutions.

15. Written Communications (other than
Reports of Commission and Officers).

16. Councilmember Discussion Items.

Agendas and reports are accessible on the City's webpage at smgov.net/council/agendas. They are also available at the City Clerk's Office and in alternate formats upon request. For a free email subscription to the City Council Agendas, please contact the City Clerk’s Office at (310) 458-8211 or [email protected].

Si desea comunicarse con alguien en español, llame a nuestra oficina al (310) 458-8211 y pida hablar con Esterlina Lugo.

City of Santa Monica Generated: 2/27/2023 10:46 AM Page 3

AGENDAS

CITY OF SANTA MONICA

REGULAR AND SPECIAL JOINT MEETING

CITY HALL COUNCIL CHAMBERS
1685 MAIN STREET, ROOM 250,
TUESDAY, FEBRUARY 28, 2023
MEETING BEGINS AT 5:30 PM
HOW TO PROVIDE WRITTEN PUBLIC COMMENT:

Written public comment can be submitted via email to [email protected].

Written comments received prior to 12:00 pm on the day of the meeting will be available online. Please note the agenda item number in the subject line of your written comments.

To listen to the livestream of this meeting, please call (310) 883-7522 (US), ID Number 583431990#

CALL TO ORDER

PLEDGE OF ALLEGIANCE

ROLL CALL

1. PUBLIC INPUT
(Public comment is permitted only on items not on the agenda that are within the subject matter jurisdiction of the City. State law prohibits the City Council from taking any action on items not listed on the agenda, including issues raised under this agenda item.)

2. PUBLIC INPUT (AGENDA ITEMS UNDER CLOSED SESSION, SPECIAL AGENDA

ITEMS, CONSENT CALENDAR ONLY)

3. CLOSED SESSIONS

3.A. Conference with Real Estate Negotiator pursuant to Government Code Section 54956.8: Property: 3200 Airport Avenue (~8,500 sf), Santa Monica, California; City Negotiators: Stelios Makrides, Chief Operations Officer/Airport Director; Owner of Record: City of Santa Monica; Persons to be negotiated with Clover Restaurants, Inc.; Under negotiation: Restaurant Lease Terms - New Item Received 2/23/2023
City of Santa Monica Generated: 2/27/2023 10:46 AM Page 4

3.B. Conference with Legal Counsel – Existing Litigation – Litigation has been initiated formally pursuant to Government Code Section 54956.9(d)(1): City of Santa Monica et al. v. 1238 10th Street, LLC, et al., Case No. 21SMCV01585 - New Item Received 2/23/2023

3.C. Conference with Legal Counsel – Existing Litigation – Litigation has been initiated formally pursuant to Government Code Section 54956.9 (d)(1): NMS 1539, LLC et al. v. City of Santa Monica, et al., Central District of California Case No. 2:20-cv-11318-FLA(JPRx) - New Item Received 2/23/2023

3.D. Conference with Legal Counsel – Anticipated Litigation – Regarding facts and circumstances that might result in litigation against the City pertaining to California Government Code section 65589.5(d): WS Communities v. City of Santa Monica - New Item Received 2/23/2023
The following is the order of business for items to be heard no earlier than 7:00 p.m.

4. SPECIAL AGENDA ITEMS

4.A. City Manager's Report

4.B. Proclamation: Kiwanis Day 2/28/23 - New Item Received 2/23/2023

5. CONSENT CALENDAR
(All items will be considered and approved in one motion unless removed by a Councilmember for discussion. In accordance with Charter section 615, the adoption of all ordinances and resolutions shall be by reading of title only unless a Councilmember present dissents.)

5.A. Award Agreement for City Wide Plumbing Contractor Services City of Santa Monica Generated: 2/27/2023 10:46 AM Page 5 Recommended Action
Staff recommends that the City Council:

1. Award Bid #4433 to Plumbing by Todd R. Marsh, Inc. dba TRM Services and Verne’s Plumbing, for citywide as-needed plumbing contracting services as required by the Public Works Department.

2. Authorize the City Manager to negotiate and execute an agreement with TRM Services, in an amount not to exceed $900,000 for two years, with one additional three-year renewal option in the amount of $1,350,000 for a total amount not to exceed $2,250,000 over a 5-year period with future year funding contingent on Council budget approval.

3. Authorize the City Manager to negotiate and execute an agreement with Verne’s Plumbing, in an amount not to exceed $500,000 for two years, with one additional three-year renewal option in the amount of $750,000 for a total amount not to exceed $1,250,000 over a 5-year period with future year funding contingent on Council budget approval.

4. Adopt a finding of Categorical Exemption pursuant to Section 15301 (Existing Facilities), of the California Environmental Quality Act (CEQA) Guidelines.

5.B. Approval of Agreement with Gillig LLC to Purchase Fifteen 35-foot Battery Electric Buses
Recommended Action
Staff recommends that the City Council:

1. Authorize the City Manager to negotiate and execute an agreement with Gillig LLC to furnish and deliver up to fifteen 35-foot battery electric buses to the Santa Monica Department of Transportation. This recommended award is made as an exception to the competitive bidding process pursuant to Section

2.24.250(c) and is for a total amount not to exceed $18,147,670 with future year funding contingent on Council budget approval;

2. Authorize budget changes as outlined in the Financial Impacts & Budget Actions section of this report;

3. Adopt a finding of Categorical Exemption pursuant to Section 15302 (Replacement or Reconstruction) of the California Environmental Quality Act (CEQA) Guidelines.

5.C. Award Bid SP2486 to Swinerton Builders for the 3200 Airport Ave Renovation Project
City of Santa Monica Generated: 2/27/2023 10:46 AM Page 6 Recommended Action
Staff recommends that the City Council:

1. Award Bid #SP2486 to Swinerton Builders for the construction of the 3200 Airport Avenue building renovation for the Public Works Department;

2. Authorize the City Manager to negotiate and execute a contract with Swinerton Builders, in an amount not to exceed $9,084,792 (including a $1,184,973 contingency);

3. Authorize the Director of Public Works to issue any necessary change orders to complete additional work within contract authority.

4. Award Bid #SP2486 to Totum Corporation for construction management services for the Public Works Department;

5. Authorize the City Manager to negotiate and execute an agreement with Totum Corporation, in an amount not to exceed $653,793.

6. Adopt a finding of Categorical Exemption pursuant to Sections 15301 (Existing Facilities) and 15302 (Replacement/Reconstruction), of the California Environmental Quality Act (CEQA) Guidelines.

5.D. Authorization of 6th Modification to Contract #8928 with Trapeze, Inc. for Vehicle and Operator Scheduling Systems
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines.

2. Authorize the City Manager to negotiate and execute a sixth modification to #8928 (CCS) for $527,781 with Trapeze Group to extend maintenance support of the Trapeze operator and vehicle scheduling systems for two additional years through June 30, 2025, to configure the operator scheduling module to accommodate a shortened workweek in an effort to improve operator work-life balance for staff retention purposes, to add up to two additional absence codes to the OPS Timekeeping module, and to train staff on the use of the Timekeeping module. This will result in a 13-year amended agreement with a new total amount not to exceed $3,666,991 with future year funding contingent on Council budget approval.

5.E. Authorization to Accept a Donation from Kiwanis Charities of Santa Monica to Purchase and Install Scoreboards at Los Amigos Park and Historic Belmar Park
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding that the scoreboards are categorically exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15311 (Class 11 Accessory Structures) of the CEQA Guidelines;

2. Authorize the City Manager to accept a donation in the amount of $70,000 from Kiwanis Charities of Santa Monica for the purchase and installation of one scoreboard at Los Amigos Park and one scoreboard at Historic Belmar Park; and
City of Santa Monica Generated: 2/27/2023 10:46 AM Page 7

3. Authorize budget changes as outlined in the Financial Impacts & Budget Actions section of this report.

5.F. Adoption of Resolutions Authorizing the City Manager to Submit Applications to Participate in the California Department of Housing and Community Development's Prohousing Designation Program and a Prohousing Incencentive Program (PIP) Grant in the Amount of $500,000 Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines and find that uses of grant funding for affordable housing are consistent with the certified 6th Cycle Housing Element Environmental Impact Report.

2. Adopt the attached resolution authorizing the City Manager to submit an application to participate in the California Department of Housing and Community Development’s Prohousing Designation Program;

3. Adopt the attached resolution authorizing the City manager to submit an application for grant funds in the amount of $500,000 from the California Department of Housing and Community Development’s Prohousing Incentive Program (PIP) for planning and implementation activities related to housing and community development, to support implementation of the certified Housing Element;

4. Authorize the City Manager to execute all necessary documents to apply for the grant, accept the grant, if awarded, and accept all grant renewals and modifications, if awarded; and

5. Authorize budget changes as outlined in the Financial Impacts and Budget Actions section of this report, in the event the grant is awarded.

5.G. Adoption of Salary Resolution for New and Existing Job Classifications and Approval of Position Changes
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no project and/or categorical exemption pursuant to Section 15324 (Class 24 Regulations of Working Conditions) of the California Environmental Quality Act (CEQA) Guidelines; and

2. Adopt a resolution establishing a new classification and salary rate for the new classification of Executive Administrative Assistant-CAO (Attachment A); and

3. Approve the cost neutral budget and position changes described in the Financial Impacts and Budget Action section of this report.

5.H. City Council - Regular Meeting - Feb 14, 2023 5:30 PM . SPECIAL JOINT MEETING OF THE CITY COUNCIL AND THE

REDEVELOPMENT SUCCESSOR AGENCY
. ROLL CALL
City of Santa Monica Generated: 2/27/2023 10:46 AM Page 8

5.I. Annual Investment Policy Update
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines.

2. Review and approve the City’s revised Investment Policy.

3. Extend the delegation of investment authority to the Director of Finance, as City Treasurer, from March 1, 2023 through February 28, 2024.

Staff also recommends that the Successor Agency Governing Board:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exception) of the California Environmental Quality Act (CEQA) Guidelines.

2. Review and approve the City Investment Policy for Successor Agency Investments.

3. Extend investment authority to the Treasurer of the Successor Agency, from March 1, 2023 through February 28, 2024.

5.J. Approval of minutes for Redevelopment Successor Agency meeting - New Item Received 2/23/2023
Recommended Action
Staff recommends that the Redevelopment Successor Agency approve the minutes of the December 13, 2022 meeting.
. ADJOURNMENT OF SPECIAL JOINT MEETING

5.K. Adoption of a Resolution to Establish an Advisory Committee to Make Recommendations Regarding Expenditure of additional funds raised by increasing the transient occupancy tax above 14% - New Item Received 2/23/2023
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines;

2. Adopt the attached resolution establishing an advisory committee to make recommendations regarding the expenditure of additional funds raised by increasing the City’s transient occupancy tax rate by 1% for hotel stays and 3% for home-share stays pursuant to Measure CS.

6. PUBLIC INPUT ON REMAINING AGENDA ITEMS
. All Public Comment on Item 8.A. the Housing Element was heard at the February 14th meeting.

7. STUDY SESSION
City of Santa Monica Generated: 2/27/2023 10:46 AM Page 9

7.A. Solid Waste Rate Study
Recommended Action
Staff recommends that the City Council:

1. Receive staff analysis of the Resource Recovery and Recycling solid waste rate study.

2. Review rate adjustment options and provide direction.

3. Consider the creation of a solid waste rate discount program and provide direction.

8. CONTINUED ITEMS

8.A. Study Session on Implementation of 6th Cycle (2021-2029) Housing Element Programs - New Item Received 2/23/2023
Recommended Action
To ensure that the City of Santa Monica remains in compliance and consistent with its approved 6th Cycle Housing Element of the City’s General Plan, staff recommends that the City Council discuss and provide direction on the policy questions presented in this report regarding the Planning Commission’s recommended amendments to the following:
• Land Use and Circulation Element of the General Plan; • Bergamot Area Plan;
• Downtown Community Plan, and
• The City of Santa Monica Comprehensive Zoning Ordinance, Santa Monica Municipal Code Chapters 9.01 to 9.52,
City Council is also being asked to discuss and provide direction on the following:
• Amendments to the General Plan Land Use Designation Map and the Official Zoning Map for Consistent Designation of Parcels;
• Amendments to the Zoning Ordinance for Consistency with State Law Updates related to Housing Production and Minimum Parking Requirements; and
• Minor Clarifying Amendments to the Zoning Ordinance.

9. ADMINISTRATIVE PROCEEDINGS
No items

10. ORDINANCES
(Public comment is permitted on ordinances for introduction and first reading. No public discussion is permitted on ordinances for second reading and adoption.)

10.A. Second Reading and Adoption of an Ordinance Amending Santa Monica Municipal Code Chapter 6.42 that Established the Outdoors Parklet Program Recommended Action
Staff recommends that the City Council adopt the attached Ordinance.

City of Santa Monica Generated: 2/27/2023 10:46 AM Page 10

10.B. Introduction and First Reading of an Interim Zoning Ordinance Eliminating Prohibition of Certain Restaurants in Establishments with Frontage on the Third Street Promenade - New Item Received 2/23/2023
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines; and

2. Introduce for first reading an Interim Zoning Ordinance eliminating the prohibition of certain restaurants with frontage on the Third Street Promenade.

11. STAFF ADMINISTRATIVE ITEMS
No items

12. PUBLIC HEARINGS
No items

13. REPORTS OF BOARDS AND COMMISSIONS
No items

14. RESOLUTIONS
No items

15. WRITTEN COMMUNICATIONS OTHER THAN REPORTS OF COMMISSION AND

OFFICERS
No items

16. COUNCILMEMBER DISCUSSION ITEMS

16.A. Recommendation to accept Garen Baghdasarian's resignation from the Commission on Sustainability, Environmental Justice and the Environment and authorize the City Clerk to publish the vacancy. - New Item Received 2/23/2023
City of Santa Monica Generated: 2/27/2023 10:46 AM Page 11

16.B. Request of Councilmember de la Torre, Mayor Pro Tem Negrete, and Councilmember Para that in the spirit of acknowledging Nick Gabaldon’s mixed heritage and to build intercultural solidarity, upon completion of Reframe: City Hall Murals, initiate a public art and community engagement Reframe project to commemorate the Historic Bay Street Beach site and its rich history of Black surfers, including Nick Gabaldon. In commemorating Nick Gabaldon, consideration will be given to creating a statue of Nick Gabaldon with his surfboard looking out towards Malibu where he passed while surfing.

The process will include engaging an artist to commemorate the Historic Bay Street Beach site’s history and people while creating a powerful acknowledgement of people of color who were pioneers in the sport of surfing. - New Item Received 2/23/2023

16.C. Request of Mayor Davis and Councilmember Zwick that the City Council adopt the attached Resolution (Attachment A) titled, “A Resolution of the City of Santa Monica, declaring support for the Iranian American community and the people of Iran, particularly the women of Iran, and a call to action for technology companies to support internet freedom. - New Item Received 2/23/2023

ADJOURNMENT
Agendas and reports are accessible on the City's webpage at www.smgov.net/council/agendas. They are also available at the City Clerk's Office and in alternate formats upon request. For a free email subscription to the City Council Agendas, please contact the City Clerk’s Office at (310) 458-8211 or [email protected].

Members of the public unable to attend a meeting but wishing to comment on an item(s) listed on the agenda may submit written comments prior to the meeting by meeting by mailing them to: City Clerk, 1685 Main Street, Santa Monica, CA 90401 or to [email protected]. Written comments received from the public by 2 PM on the day of the City Council meeting will be distributed to the City Council prior to the meeting and posted online.

City Hall and the Council Chamber are wheelchair accessible. If you require any special disability related accommodations to either attend or provide public testimony at a Council meeting (i.e. sign language interpreting, access to an amplified sound system, remote option, etc.), please contact the City Clerk’s Office at (310) 458-8211 or TDD: (310) 917- 6626 or via email at [email protected] at least 72 hours prior to the scheduled meeting. Best efforts shall be made to accommodate requests received after the 72-hour deadline. In the case of special meetings, requests should be submitted as early as possible, but no later than noon the day of the special Council meeting.

Si desea comunicarse con alguien en español, llame a nuestra oficina al (310) 458-8211 y pida hablar con Esterlina Lugo.

Santa Monica Blue Bus Lines #2, #3, #5, #9 and the EXPO Line serve City Hall. Parking is available on Main Street, on Olympic Drive, and in the Civic Center Parking Structure (validation free).

City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 4.A
1 of 1
To: Mayor and City Council
From: David White, City Manager, City Manager's Office
Subject: City Manager's Report
Prepared By: Esterlina Lugo, Deputy City Clerk
Approved Forwarded to Council

4.A
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City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 4.B
1 of 1
To: Mayor and City Council
From: Denise Anderson Warren, City Clerk, Special Agenda Items Subject: Proclamation: Kiwanis Day 2/28/23
Prepared By: Gilbert Portillo, Administrative Staff Assistant Approved Forwarded to Council

4.B
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City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 5.A
1 of 5
To: Mayor and City Council
From: Rick Valte, Public Works Director, Public Works, Facilities Maintenance Subject: Award Agreement for City Wide Plumbing Contractor Services Recommended Action
Staff recommends that the City Council:

1. Award Bid #4433 to Plumbing by Todd R. Marsh, Inc. dba TRM Services and Verne’s Plumbing, for citywide as-needed plumbing contracting services as required by the Public Works Department.

2. Authorize the City Manager to negotiate and execute an agreement with TRM Services, in an amount not to exceed $900,000 for two years, with one additional three-year renewal option in the amount of $1,350,000 for a total amount not to exceed $2,250,000 over a 5-year period with future year funding contingent on Council budget approval.

3. Authorize the City Manager to negotiate and execute an agreement with Verne’s Plumbing, in an amount not to exceed $500,000 for two years, with one additional three-year renewal option in the amount of $750,000 for a total amount not to exceed $1,250,000 over a 5-year period with future year funding contingent on Council budget approval.

4. Adopt a finding of Categorical Exemption pursuant to Section 15301 (Existing Facilities), of the California Environmental Quality Act (CEQA) Guidelines.

Summary
The City utilizes plumbing contractor services to perform work that requires specialized equipment, contractor licensing and technical expertise that cannot be provided by City staff. Staff solicits the services of a plumbing contractor approximately 85 times per year to ensure effective and efficient maintenance of the City’s infrastructure. These contracted services range from jobs that require immediate attention due to safety concerns to large-scale repairs that require specific State Contractor Licenses and

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equipment certifications. Staff recommends a split award for the two best bidders:

Plumbing by Todd Marsh, Inc. dba TRM Services and Verne’s Plumbing.

Discussion
The City employs three permanent in-house plumbers, including one plumber crew leader, to provide various plumbing services citywide. Typical services provided by City staff include repairing drain line stoppages and fixtures, replacing water filters, installing water heaters, and performing tenant improvement projects. Staff solicits the services of a plumbing contractor to assist with the overall maintenance of City-owned facilities.

These services are needed for urgent repairs to the City’s ailing infrastructure such as the Pier and beach restrooms as well as large-scale jobs that require the excavation of water and sewer lines or installation of new fixtures such as drinking fountains, sinks and toilets. The City has historically contracted out plumbing contracting services. The “Contract and As-Needed Staffing Review Policy, Practice, Recommendations” report (Attachment A) approved on January 13, 2015, recommended that general contracting services be contracted due to equipment requirements, specialized expertise, and risk management. Additionally, to expedite responsiveness to requests for such services, staff recommends a split award to two contractors.

The need for contracted plumbing services is continual thus staff seeks to execute agreements to address: 1) small-scale, urgent, and after-hour plumbing contractor repair services, 2) plumbing contractor repair services that require specialized licensing and equipment, and 3) large-scale projects that are often long-term. The requested not to exceed amounts account for increases in the City’s demand for as-needed plumbing contractor services, prevailing wage rates, material costs and fuel and equipment surcharges.

Vendor Selection
Bidder Recommendation
Best Bidders Plumbing by Todd Marsh, Inc. dba TRM Services Verne’s Plumbing
Evaluation Criteria Bid evaluated on general plumbing and construction experience, pricing, renewal options and requested increases.

Municipal Code SMMC 2.24.180

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Bid Data
Date Posted Posted On Advertised in (City
Charter & SMMC)
Vendors
Downloaded
Date Publicly
Opened
09/13/2022 City’s Online
Bidding Site
Santa Monica Daily
Press
15 10/11/2022
Best Bidder Justification
Bids were evaluated based on the criteria in SMMC 2.24.180 including municipal plumbing construction experience, pricing, renewal options and requested increases.

Staff determined that Todd Marsh, Inc. dba TRM Services and Verne’s Plumbing are the best bidders based on the following criteria: 1) general plumbing and construction municipal experience, 2) pricing and 3) renewal options and requested increases.

Additionally, staff assessed ability, capacity, and skill by evaluating various California State Contractors licenses each firm possessed.

Environmental Assessment
The awards for plumbing contractor services are categorically exempt from the California Environmental Quality Act (CEQA) under Section 15301. Section 15301 of the CEQA State Guidelines provides Class 1 (existing facilities) exemption for projects that consists of the operation, repair, maintenance, leasing, licensing, permitting, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of the existing or former use. The awards for the plumbing contractor services would not result in any modifications to existing facilities. The existing facilities would be maintained and repaired with the plumbing contractor services and the award of services would not expand or materially change existing facilities or operations. Therefore, the project is categorically exempt as set forth in Section 15301 of the CEQA State Guidelines.

Submittals Received
Vendor Hourly Rate Overtime Rate
Horn’s Backflow and Plumbing Service, Inc. $250.00 $450.00 Plumbing by Todd R. Marsh, Inc. dba TRM
Services $92.00 $120.00
Suttles Plumbing and Mechanical Corp. $157.00 $235.00
Verne’s Plumbing $125.00 $250.00

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Past Council Actions
Meeting Date Description
01/13/15
(Attachment A)
Staff Report – As-Needed and Contract Staffing Review Report 09/12/17
(Attachment B)
Staff Report – City Council authorization to award Bid #4281 to Plumbing by Todd Marsh, Inc. dba TRM Services and Horn’s Backflow and Plumbing Services, Inc. and negotiate and execute Contract 10531 and 10532 for plumbing contractor services 02/13/2018
(Attachment E)
Staff Report – City Council authorization to negotiate and execute a first modification to Contract 10531 with Plumbing by Todd R. Marsh, Inc. dba TRM Services.

Financial Impacts and Budget Actions
Staff seeks authority to approve available funding from various General Fund, Enterprise Funds and CIP accounts to award agreements with Plumbing by Todd R.

Marsh, Inc. dba TRM Services and Verne’s Plumbing for citywide plumbing contractor services. Future year funding is contingent on Council budget approval.

Contract Request
Vendor
FY 2022-23
Request Amount
Future Years
Amounts
Department/
CIP Accounts #
Total Contract
Amount
Todd R. Marsh, Inc.
dba TRM Services $100,000  $2,150,000Various Accounts   $2,250,000 Verne’s Plumbing $50,000 $1,200,000Various Accounts  $1,250,000 Prepared By: Kyla Johnson, Senior Administrative Analyst Approved Forwarded to Council

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Attachments:

A. Staff Report_January 13, 2015
B. Staff Report_September 12, 2017
C. Staff Report_February 13, 2018
D. TRM_Contract 10531
E. TRM_Contract 10531 - Mod 1
F. Horn's Backflow_Contract 10532
G. Horn's Backflow_Contract 10532 - Mod 1
H. TRM OAKS
I. Verne's OAKS

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5.A.a
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Attachment: Staff Report_January 13, 2015 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Staff Report_January 13, 2015 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

5.A.a
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Attachment: Staff Report_January 13, 2015 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Staff Report_January 13, 2015 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Staff Report_January 13, 2015 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

5.A.a
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Attachment: Staff Report_January 13, 2015 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

5.A.b
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Attachment: Staff Report_September 12, 2017 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Staff Report_September 12, 2017 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Staff Report_September 12, 2017 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

5.A.b
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Attachment: Staff Report_September 12, 2017 (5057 : Award Agreement for City Wide Plumbing Contractor Services) City Council
Report
City Council Meeting: February 13, 2018
Agenda Item: 3.H
1 of 5
To: Mayor and City Council
From: Susan Cline, Director, Public Works, Architecture Services Subject: Construction Change Order for the Santa Monica Swim Center Locker Room Tile Replacement Project
Recommended Action
Staff recommends that the City Council:

1. Authorize the City Manager to negotiate and execute a first modification to construction contract #4418 in the amount of $50,000 with STB Stone, Inc., a California-based company, for additional construction services for the Santa Monica Swim Center Locker Room Tile Replacement Project. This will result in an amended contract with a new total amount not to exceed $207,300.

2. Authorize the City Manager to negotiate and execute a first modification to agreement #10531 (CCS) in the amount of $107,845 with Plumbing by Todd R.

Marsh, Inc., a California-based company, for additional plumbing contractor services for the Santa Monica Swim Center Locker Room Tile Replacement Project. This will result in an amended contract with an amount not to exceed $307,845 for one year, with two additional two-year renewal options in the amount of $840,808 including an increase of 2% each year, for a total amount not to exceed $1,148,653, over a five-year period, with future year funding contingent on Council budget approval.

Executive Summary
On December 20, 2017, STB Stone, Inc. began demolition of the existing tile and associated drywall substrate in the locker rooms at the Santa Monica Swim Center as part of the Santa Monica Swim Center Locker Room Tile Replacement Project. During construction, the contractor discovered extensive corrosion and deterioration of the existing metal stud framing throughout both the male and female locker rooms. The damage was so severe that the existing metal stud framing members were no longer attached to the floor. Moreover, during the demolition of the wall that separates the men’s and women’s locker rooms the contractor discovered that the plumbing drains, vent systems and water lines were compromised. Repair of these severe structural and plumbing issues were not part of the original scope of the Santa Monica Swim Center

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Attachment: Staff Report_February 13, 2018 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 2 of 5
Locker Room Tile Replacement Project; however, it was critical that it be completed immediately. Due to the urgent nature of the repairs and to avoid extensive delays to the public programming that occurs at the Swim Center or to use by Santa Monica College, staff directed the contractor to proceed with the urgent repairs and is now seeking formal Council approval. Staff requests Council authorization to execute first modifications to: construction contract #4418 in the amount of $50,000 with STB Stone, Inc. to repair the locker room framing and first modification to agreement #10531 in the amount of $107,845 with Plumbing by Todd Marsh to repair the locker room plumbing.

The City anticipates reopening the Swim Center to the public and resuming regularly scheduled programming in February 2018.

Background
On December 14, 2017, the City Manager executed construction contract no. 4418 with STB Stone, Inc. in an amount not to exceed $157,300 (includes 10% contingency and $5,800 allowance for unforeseen conditions) for the Santa Monica Swim Center Locker Room Tile Replacement Project. The contracted scope of services is for construction services for the removal and replacement of the existing tile and drywall substrate in the locker rooms at the Santa Monica Swim Center located on the campus of Santa Monica College. This project is being completed as part of the annual facility renewal that occurs during the closure of the Swim Center at the end of each year. The project was bid formally, but because the selected best bidder was below the Council threshold of $175,000, Council approval was not required to initiate the project. As the unforeseen structural issues are so extensive, the cost of repairs will result in a modified contract amount which will require Council approval.

On September 12, 2017, (Attachment C), Council authorized the City Manager to execute an agreement with Plumbing by Todd R. Marsh, Inc., for citywide plumbing contractor services, in an amount not to exceed $200,000 for the first year and a total contract amount not to exceed $1,040,808 over a five-year period. Due to unforeseen plumbing repair costs, a first modification to the first-year contract amount is also needed.

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Attachment: Staff Report_February 13, 2018 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 3 of 5
Discussion
In December 2017, STB Stone, Inc. began demolition of the existing tile and associated drywall substrate in the locker rooms at the Santa Monica Swim Center. It became evident that the condition of the existing metal stud framing and plumbing would not be able to accommodate the reinstallation of new drywall and tile due to extensive rust, corrosion, and deterioration that was uncovered.

The Santa Monica Swim Center Tile Replacement Project was originally planned to be completed in 30 calendar days, in order to not produce adverse impacts or extensive delays to the public programming that occurs at the Swim Center or to facility use by Santa Monica College. City staff determined that immediate repairs to the framing and plumbing were required to complete all construction work in a timely manner. Staff directed the contractor to proceed with the urgent repairs and is now seeking formal Council approval.

Staff recommends:
 A first modification to construction contract #4418 in the amount of $50,000 with STB Stone Inc. to add framing repair to the original scope of work at the Santa Monica Swim Center, which will extend the structural life of the locker rooms for up to 15 years. This will result in an amended construction contract total amount not to exceed $207,300.
 A first modification to agreement #10531 (CCS) in the amount of $107,845 with Plumbing by Todd R. Marsh, Inc. for the plumbing repairs of drains, vent systems and water lines at the Santa Monica Swim Center locker rooms. This will result in an amended agreement total amount not to exceed $1,148,653.

Vendor Selection

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Attachment: Staff Report_February 13, 2018 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 4 of 5
On October 11, 2017, the City published Notices Inviting Bids to furnish construction services for a tile replacement project at the Santa Monica Swim Center in accordance with City specifications. The bid was posted on the City’s on-line bidding site, and notices were advertised in the Santa Monica Daily Press in accordance with City Charter and Municipal Code Section 2.24071(a) provisions. Twenty-three vendors downloaded the bid. Two bids were received and publicly opened on October 30, 2017.

Vendor Bid Amount
STB Stone, Inc. $137,200
P & P Develop, Inc. $177,956
Bids were evaluated based on criteria in SMMC 2.24.072, including price, previous experience, ability to deliver, quality of product, and compliance with City specifications.

The bid submitted by STB Stone, Inc. demonstrated an understanding of the approach, tasks, and methodology necessary to complete the required services. Based on these criteria, STB Stone, Inc., the lowest bidder, was recommended as the best bidder.

On May 9, 2017, the City published Notices Inviting Bids for citywide plumbing contractor services that included multi-year renewal options in accordance with City specifications. The bid was posted on the City's on-line bidding site, and notices were advertised in the Santa Monica Daily Press in accordance with City Charter and Municipal Code Section 2.24.100(a). A total of 20 vendors downloaded the bid. Four bids were received and publicly opened on May 25, 2017, per Attachment D. Bids were evaluated based on the criteria in SMMC 2.24.072, including price, previous experience, ability to deliver, quality of product, and compliance with City specifications. Todd R.

Marsh Inc. was not the lowest bidder when considering the hourly labor rates, but offered competitive pricing, the fastest guaranteed response time and the second lowest pricing for renewal options. Moreover, Todd R. Marsh, Inc. has provided the City with responsive and satisfactory service. Amgreen Solutions offered the lowest hourly labor rate, but its pricing is significantly lower than the established Prevailing Wage rates required by state law, demonstrating non-compliance and thus its bid was inadmissible.

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Attachment: Staff Report_February 13, 2018 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 5 of 5
Construction Schedule
Staff originally anticipated construction at the Santa Monica Swim Center to be completed in early February 2018. However due to the unforeseen structural issues, staff now anticipates construction to be completed in late February 2018.

Financial Impacts & Budget Actions
The first modification to be awarded to STB Stone, Inc. is $50,000, for an amended construction contract total amount not to exceed $207,300. Funds are available in FY 2017-2018 Capital Improvement Program budget in account M014078.589000.

The first modification to be awarded to Plumbing by Todd R. Marsh Inc. for an amended agreement not to exceed $307,845 for one year, for a total amount not to exceed $1,148,653 over a five-year period. Funds are available in FY 2017-18 Capital Improvement Program budget in account M010085.589000.

Prepared By: Sebastian Felbeck, Public Works Construction Specialist Approved Forwarded to Council
Attachments:

A. STB Stone Inc - Oaks Initiative Form
B. Todd R Marsh Oaks Form
C. Staff Report 9.12.2017
D. F4281 PLUMBING CONTRACTOR BID RESULTS

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Attachment: Staff Report_February 13, 2018 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM_Contract 10531 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 1 SECOND MODIFICATION OF AGREEMENT NO. 10531 (CCS)
This Second Modification of Agreement Number 10531 (CCS) (“Second Modification”), entered into as of ___________ ("Execution Date"), by and between the City of Santa Monica, a municipal corporation (“City”), and Plumbing by Todd R. Marsh, Inc. (TRM Services) is made with reference to the following:

RECITALS
A. On or about December 20, 2017 the City and TRM Services entered into Agreement Number 10531 (CCS) for citywide plumbing contractor services for maintenance, repair, and installation as required by the Facilities Maintenance Division for an amount not to exceed $1,040,808 (“Original Agreement”).

B. On or about March 8, 2018, the City and TRM SERVICES entered into a First Modification of Agreement Number 10531 (CCS) (“First Modification”) which increased the original contract price to a total not-to-exceed amount of $1,148,653 with all renewal options exercised.

C. On or about September 4, 2018, the City and TRM SERVICES entered into a First Renewal of Agreement Number 10531 (CCS) (“First Renewal”) which renewed the Original Agreement to extend the contract term to October 31, 2020.

D. On or about November 19, 2020, the City and TRM SERVICES entered into a Second Renewal of Agreement Number 10531 (CCS) (“Second Renewal”) which renewed the Original Agreement to extend the contract term to October 31, 2022.

The Original Agreement, First Modification, First Renewal and Second Renewal may be referred to collectively herein as “the Agreement.” E. The City and TRM SERVICES desire to modify the Agreement to extend the contract term.

TERMS AND CONDITIONS
Now, therefore, the undersigned parties do hereby mutually agree to modify the Agreement as follows:

1. Term. This Agreement begins on the Execution Date and terminates on April 30, 2023, unless terminated earlier as set forth in the Original Agreement or extended by the parties in writing.

2. Full Force and Effect. Except as expressly modified by this Second Modification, all other terms and conditions of the Original Agreement shall be and remain in full force and effect.
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DocuSign Envelope ID: F5855415-3E1F-4A7F-9A58-F8F780662F78 11/23/2022

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Attachment: TRM_Contract 10531 - Mod 1 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 2 3. Execution in Counterparts. This Second Modification may be executed in counterparts with the same effect as if both parties hereto had executed the same document. All counterparts shall be construed together and shall constitute a single modification. Any signature to this Second Modification transmitted electronically through DocuSign or PDF shall be deemed an original signature and be binding upon the parties hereto (it being agreed that such electronic signature shall have the same force and effect as an original signature).

IN WITNESS WHEREOF, the parties have executed this Second Modification as of the date and year first written above.

ATTEST:
______________________________

DENISE ANDERSON-WARREN
City Clerk
APPROVED AS TO FORM:
______________________________

LANE DILG
City Attorney

CITY OF SANTA MONICA,
a municipal corporation
By: ______________________________

RICK COLE
City Manager
TRM SERVICES Corporation
#VENDOR
By: _______________________________
DocuSign Envelope ID: F5855415-3E1F-4A7F-9A58-F8F780662F78 11/21/2022

DOUGLAS SLOAN
City Attorney
President & CE)
Plumbing by Todd R. Marsh, Inc.

Todd R. Marsh
11/22/2022
David White
11/23/2022
City Manager City Clerk
11/28/2022
Denise Anderson-Warren

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Attachment: TRM_Contract 10531 - Mod 1 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: Horn's Backflow_Contract 10532 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 1 FIRST MODIFICATION OF AGREEMENT NO. 10532 (CCS)
This First Modification of Agreement Number 10532 (CCS) (“First Modification”), entered into as of ___________(“Execution Date”), by and between the City of Santa Monica, a municipal corporation (“City”), and Horn’s Backflow & Plumbing Service, Inc. (“HORN’S BACKFLOW & PLUMBING SERVICE”) is made with reference to the following:

RECITALS
A. On or about December 14th, 2017, the City and HORN’S BACKFLOW & PLUMBING SERVICE entered into Agreement Number 10532 (CCS) for plumbing contractor services as required by the Facilities Maintenance Division (“Original Agreement”).

B. The City and HORN’S BACKFLOW & PLUMBING SERVICE desire to modify the Original Agreement to increase the contract price.

TERMS AND CONDITIONS
Now, therefore, the undersigned parties do hereby mutually agree to modify the Original Agreement as follows:

1. Section 4.1 of the Original Agreement shall be modified by deleting the text of Section 4.1 and replacing it with the following paragraph:

4.1 Total Amount Not To Exceed. In the event the City Exercises the (2) additional (2) year renewal options, the total amount for the Term and Extension Term(s) shall not exceed $250,000, as set forth in Exhibit B-1.

2. Exhibit B-1 is attached hereto and incorporated herein by this reference. \\
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DocuSign Envelope ID: 4613FE93-7A5E-4226-A809-5A8A26DB9988 1/19/2021

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Attachment: Horn's Backflow_Contract 10532 - Mod 1 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 2 3. Except as expressly modified by this First Modification, all other terms and conditions of the Original Agreement shall be and remain in full force and effect.

IN WITNESS WHEREOF, the parties have executed this First Modification as of the date and year first written above.

ATTEST:
______________________________

DENISE ANDERSON-WARREN
City Clerk
APPROVED AS TO FORM:
______________________________

LANE DILG
City Attorney

CITY OF SANTA MONICA,
a municipal corporation
By: ______________________________

RICK COLE
City Manager
HORN’S BACKFLOW & PLUMBING
SERVICE Corporation
#VENDOR
By: _______________________________
DocuSign Envelope ID: 4613FE93-7A5E-4226-A809-5A8A26DB9988 1/12/2021
Interim City Attorney
George Cardona
Bruce Horn
1/18/2021
CEO
Horn's Backflow and Plumbing
1/19/2021
Interim City Manager
Denise Anderson-Warren Lane Dilg
City Clerk
2/10/2021

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Attachment: Horn's Backflow_Contract 10532 - Mod 1 (5057 : Award Agreement for City Wide Plumbing Contractor Services) 3 Exhibit B-1
Budget
I. Labor Rates. Jobs shall be quoted individually with specifications provided by Facilities Maintenance staff using the labor rates noted below (per Bid 4281):

Contract Term Extension Term(s)
Labor Rate Execution Date to October 31,
2018
November 1, 2018- October
31, 2020
November 1, 2020- October
31, 2022
Regular Hourly
Rate
$95.00/hour $95.00/hour $95.00/hour
Overtime
Hourly
Rate
$125.00/hour $125.00/hour $125.00/hour
II. Additional Pricing.

1. The after-hours / weekends labor rate (otherwise known as Overtime) shall be applicable for work completed Monday through Friday from 4:30 p.m. to 8 a.m., and all of Saturday and Sunday.

2. Minimum call-out charge shall be $95.00—Same Price, Terms and Conditions offered throughout the Contract Term and Extension Term(s).

3. Rates for equipment, materials and reimburseables shall be indicated on individual job proposals.

III. Contract Term and Extension Term(s). The City will compensate HORN’S BACKFLOW & PLUMBING SERVICE for the services performed in an amount not to exceed $250,000 for the Contract Term and Extension Term(s).

IV. Invoices. Horn’s Backflow & Plumbing Service shall invoice the City per job under Net 30 terms.

DocuSign Envelope ID: 4613FE93-7A5E-4226-A809-5A8A26DB9988

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Attachment: Horn's Backflow_Contract 10532 - Mod 1 (5057 : Award Agreement for City Wide Plumbing Contractor Services)

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Attachment: TRM OAKS (5057 : Award Agreement for City Wide Plumbing Contractor Services)

CITY OF SANTA MONICA

OAKS INITIATIVE NOTICE

NOTICE TO APPLICANTS, BIDDERS, PROPOSERS

AND OTHERS SEEKING DISCRETIONARY PERMITS, CONTRACTS,

OR OTHER BENEFITS FROM THE CITY OF SANTA MONICA
Santa Monica’s voters adopted a City Charter amendment commonly known as the Oaks Initiative. The Oaks Initiative requires the City to provide this notice and information about the Initiative’s requirements. You may obtain a full copy of the Initiative’s text from the City Clerk.

This information is required by City Charter Article XXII—Taxpayer Protection.

It prohibits a public official from receiving, and a person or entity from conferring, specified personal benefits or campaign advantages from a person or entity after theofficial votes, or otherwise takes official action, to award a “public benefit” to that person or entity. The prohibition applies within and outside of the geographical boundaries of SantaMonica.

All persons or entities applying or receiving public benefits from the City of Santa Monica shall provide the names of trustees, directors, partners, and officers, and names of persons with more than a 10% equity, participation or revenue interest. An exception exists for persons serving in those capacities as volunteers, without compensation, for organizations exempt from income taxes under Section 501(c)(3), (4), or (6), of the Internal Revenue Code. However, this exception does not apply if the organization is a political committee or controls political committees.

Examples of a “public benefit” include public contracts to provide goods or services worth more than $25,000 or a land use approval worth more than $25,000 over a 12- month period.

In order to facilitate compliance with the requirements of the Oaks Initiative, theCity compiles and maintains certain information. That information includes the name of any personorpersons whois seeking a “publicbenefit.” If the“public benefit” is sought by an entity, ratherthan an individual person, the information includes the nameof everyperson who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity. Therefore, if you are seeking a “public benefit” covered by the Oaks Initiative, you must supply that information on the Oaks Initiative Disclosure Form. This information must be updated and supplied every 12 months.

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Attachment: Verne's OAKS (5057 : Award Agreement for City Wide Plumbing Contractor Services)

CITY OF SANTA MONICA

OAKS INITIATIVE DISCLOSURE FORM
In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity.

Public benefits include:

1. Personal services contracts in excess of $25,000 over any 12-monthperiod;

2. Sale of material, equipment or supplies to the City in excess of $25,000 over a 12- month period;

3. Purchase, sale or lease of real property to or from the City in excess of $25,000 over a 12- month period;

4. Non-competitive franchise awards with gross revenue of $50,000 or more inany 12-month period;

5. Land use variance, special use permit, or other exception to an established land use plan, where the decision has a value in excess of $25,000;

6. Tax “abatement, exception, or benefit” of a value in excess of $5,000 in any 12- month period; or

7. Payment of “cash or specie” of a net value to the recipient of $10,000 in any 12- month period.

Name(s) of persons or entities receiving public benefit:

Name(s) of trustees, directors, partners, and officers:

Name(s) of persons with more than a 10% equity, participation, or revenue interest:

Prepared by: Title:

Signature: Date:

Email: Phone:

Permit #
FOR CITY USE ONLY:

Bid/PO/Contract #

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Attachment: Verne's OAKS (5057 : Award Agreement for City Wide Plumbing Contractor Services) City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 5.B
1 of 6
To: Mayor and City Council
From: Edward F King, Director, Department of Transportation, Transit Maintenance Subject: Approval of Agreement with Gillig LLC to Purchase Fifteen 35-foot Battery Electric Buses
Recommended Action
Staff recommends that the City Council:

1. Authorize the City Manager to negotiate and execute an agreement with Gillig LLC to furnish and deliver up to fifteen 35-foot battery electric buses to the Santa Monica Department of Transportation. This recommended award is made as an exception to the competitive bidding process pursuant to Section 2.24.250(c) and is for a total amount not to exceed $18,147,670 with future year funding contingent on Council budget approval;

2. Authorize budget changes as outlined in the Financial Impacts & Budget Actions section of this report;

3. Adopt a finding of Categorical Exemption pursuant to Section 15302 (Replacement or Reconstruction) of the California Environmental Quality Act (CEQA) Guidelines.

Summary
To advance efforts to transition the Big Blue Bus fleet to zero emissions buses by 2030, staff recommends that the City execute a contract not to exceed $18,147,670 with Gillig, LLC for the purchase of up to 15 battery electric buses (BEBs), including spare parts, training, and warranty. The award recommendation is based on a competitively bid agreement awarded to Gillig by the State of Washington.

Operating a regional transit system covering more than 60 square miles of the western Los Angeles area and serving more than 7 million passengers a year, the Big Blue Bus (BBB), a division of the Department of Transportation (DoT), is committed to reducing

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harmful emissions and pursuing the most environmentally sustainable vehicles to provide service to customers and meet the operational needs of the department. In support of that goal, DoT is converting its Compressed Natural Gas (CNG) fleet of buses to Zero Emissions vehicles. Pursuant to its Fleet Management Plan and Federal Transportation Administration (FTA) guidelines, DoT replaces buses every 12 years or 500,000 miles. Staff recommends that buses be replaced on a one-for-one basis to comport to its Fleet Management Plan strategy. Fifteen (15) CNG buses, purchased in 2010 and 2011, are currently due for replacement.

Discussion
To support the City of Santa Monica’s sustainability goals, the Santa Monica Department of Transportation presented a Fleet Composition Study to Council in April 2018. Based on the study’s findings, Council reaffirmed its commitment to a full transition to zero emissions by 2030. In support of the City’s sustainability target, DoT has been operating BEBs in its fleet since August 13, 2019, and currently has nineteen BEBs in service. In preparation for the adoption of BEBs, DoT completed a fleet electrification master planning effort that evaluated its service to create a phased implementation plan for the replacement of its CNG-powered buses and the installation of charging infrastructure to fuel the vehicles. This report found that Big Blue Bus’s current service needs can be met with existing BEBs now available on the market and that overnight charging for these buses can be accommodated by our existing charging system. DoT is also planning to enhance its charging infrastructure to accommodate future BEB purchases. A consultant is currently developing construction and design documents for the next phase of DoT’s electric bus charging infrastructure which is scheduled to be built by the end of 2024. Additionally, the BEBs in the Big Blue Bus fleet have performed well, and staff has received positive feedback from Motor Coach Operators who have driven the buses and customers who have ridden on them. Since Gillig vehicles comprise more than 80% of the BBB fleet, parts, maintenance, and technician familiarity with the bus provide efficiencies and economies of scale for fleet maintenance and warehousing of vehicle parts.

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Staff recommends executing a contract with Gillig LLC, pursuant to the same base price as set forth in the terms and conditions in the State of Washington’s Transit Bus Invitation for Bid (IFB) dated March 4, 2020, and the subsequently executed contract 06719-01 dated April 1, 2021. This procurement authorizes local government agencies outside the State of Washington to purchase electric buses in accordance with the prices listed in Attachment D of the IFB. Procurement of electric buses using the State of Washington bid would enable the department to meet its goal of timely replacement of vehicles that have reached their twelve-year useful life in accordance with BBB’s fleet replacement plan.

Analysis
Base Price for each BEB (April 2021) 808,816
City and DoT technical requirements* 147,772
Delivery 1,997
Pre-tax unit price 958,585
PPI Adjustment per WA Contract (11.78%) (June 2022) 112,921 Current Pre-Tax Unit Price - (1/16/2023) 1,071,506
Applicable taxes 64,854
Total current unit price including taxes 1,136,360
Price for 15 electric buses 17,045,400
Spare Parts 150,000
Training 100,000
Contingency - 5% 852,270
Total Authorization Requested for Electric Bus Contract 18,147,670 *City and DoT technical requirements include Clever Devices hardware/software for the Radio/Computer-Aided Dispatch-Automated Vehicle Location (CAD-AVL) system, Automatic Passenger Counters, Wi-Fi, electric doors, the BBB seating layout, wheelchair restraints, and passenger surveillance systems.

Vendor Selection
Exception to Competitive Bidding

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Staff recommends Gillig LLC to furnish and deliver battery electric transit buses as an exception to competitive bidding per Muni Code 2.24.250 (c).

SMMC 2.24.250 (c) allows for the City to use a competitive bidding process of another government entity where the goods or services supplied to the City are the “same or better price” as the price obtained by that agency. Here, the State of Washington followed all federal requirements and procedures in connection with its IFB for the delivery of 35-foot electric buses. As a result of this process, Washington determined that four vendors, including Gillig, were qualified to provide electric transit buses and executed contracts with each of the qualified vendors.

Gillig was selected as the best value for Santa Monica DoT from among the qualified vendors primarily due to the following factors:

Maintainability: Approximately 80% of DoT’s existing fleet are Gillig buses and the BEBs produced by Gillig share 80% of parts and design with 40’ Gillig buses in the existing fleet. As a result, less training is needed to familiarize technicians with Gillig components and Motor Coach Operators with the operation of the vehicle.

History of excellent product support: Gillig is a California-based company headquartered in Livermore CA. DoT has a positive work history with Gillig buses since 2013, and DoT has received excellent parts and service support for its 19 BEBs.

Technical design, and passenger and community considerations:

DoT’s 19 Gillig BEBs have performed well since their deployment in revenue service and are well received by both motor coach operators and passengers.
c.
competitive procedures were followed by a governmental agency, federal, state, county, city, joint powers agency, special district, or cooperative purchasing agency and the goods or services are supplied to the City at the same or better price;
Environmental Review
The award contract for the purchase of electric replacement buses is categorically exempt from CEQA pursuant to Section 15302 of CEQA. Section 15302 exempts Class 2 projects which “consists of replacement or reconstruction of existing structures and facilities where the new structure will be located on the same site as the structure replaced and will have substantially the same purpose and capacity as the structure replaced”. The electric buses would replace existing CNG buses, with essentially the same purpose and capacity of existing CNG buses. Therefore, the project qualifies for a Class 2 exemption.

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Past Council Actions
Meeting Date Description
4/24/2018 BBB Fleet Composition Study
7/24/2018 Purchase of (1) Prototype Gillig Electric Bus 10/22/2019 Purchase of (18) 40’ Gillig Electric Buses
Financial Impacts and Budget Actions
Staff seeks authority to appropriate $4,077,128 of Federal Section 5307 reimbursable funds and approve the use of this funding from the Big Blue Bus Fund to award a contract to Gillig LLC for the purchase of up to fifteen 35-foot Battery Electric Buses as follows:

FY 2022-23 Budget Request
Funds to be Appropriated
Account Number Amount
C6004810.689000 $4,077,128
Contract Request
FY2022-23 Budget
Department/CIP Account # Total Contract Amount
Request Amount
$18,147,670 C6004810.689000 $18,147,670
The funds will be reimbursed by the Federal Transit Administration (FTA) as expenses are incurred, which is anticipated to be in FY2023-24. As such the revenue will be budgeted during the biennial budget process. Future year funding is contingent on Council budget approval.

Prepared By: David Nanjo, Administrative Analyst
Approved Forwarded to Council

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Attachments:

A. Gillig Oaks

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Attachment: Gillig Oaks (5304 : Purchase of (15) 35-foot Battery Electric Buses)

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Attachment: Gillig Oaks (5304 : Purchase of (15) 35-foot Battery Electric Buses)

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Attachment: Gillig Oaks (5304 : Purchase of (15) 35-foot Battery Electric Buses) City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 5.C
1 of 7
To: Mayor and City Council
From: Rick Valte, Public Works Director, Public Works, Architecture Services Subject: Award Bid SP2486 to Swinerton Builders for the 3200 Airport Ave Renovation Project
Recommended Action
Staff recommends that the City Council:

1. Award Bid #SP2486 to Swinerton Builders for the construction of the 3200 Airport Avenue building renovation for the Public Works Department;

2. Authorize the City Manager to negotiate and execute a contract with Swinerton Builders, in an amount not to exceed $9,084,792 (including a $1,184,973 contingency);

3. Authorize the Director of Public Works to issue any necessary change orders to complete additional work within contract authority.

4. Award Bid #SP2486 to Totum Corporation for construction management services for the Public Works Department;

5. Authorize the City Manager to negotiate and execute an agreement with Totum Corporation, in an amount not to exceed $653,793.

6. Adopt a finding of Categorical Exemption pursuant to Sections 15301 (Existing Facilities) and 15302 (Replacement/Reconstruction), of the California Environmental Quality Act (CEQA) Guidelines.

Summary
The Santa Monica Airport seeks to renovate the 3200 Airport Avenue building to comply with current code regulations, address deferred maintenance issues, minimize ongoing maintenance costs, and maximize the building’s revenue potential. The building is the location of the original administration building at the Santa Monica Airport. It is a 16,966 sq. ft single-story wood frame building with a wooden truss gable roof. Renovation would bring the structure into compliance with current building codes and achieve LEED Gold certification while preserving the historic character of the building’s exterior

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aesthetic. If approved, staff anticipates construction would commence as soon as spring of 2023 and be completed in the spring of 2024. Staff recommends awarding the construction services contract to Swinerton Builders to renovate and structurally retrofit 3200 Airport Avenue, and the construction management services contract to Totum Corporation to maintain contractor oversight and ensure that the project design intent and milestones are met.

Discussion
Built between 1940-1947, the building’s exterior features offer a demonstration of historic character unique to the region. Over decades, the building has been subdivided into multiple small and medium sized offices and leased to several commercial tenants.

The building was part of a Property Condition Assessment (Attachment A) that included a Tier 1 Seismic analysis and a comprehensive building assessment. The analysis and assessment identified numerous deficiencies of the building envelope, interior finishes, and building systems resulting in water intrusion, deterioration of building materials, and lack of thermal comfort within the building. Despite its current condition, the space maintains a 4% vacancy rate. However, as maintenance requests become more and more frequent, staff has determined that a renovation would not only minimize ongoing maintenance costs but would also maximize the building’s revenue potential.

The proposed building improvements have led to lease negotiations with Clover Restaurants, Inc. (Clover) for half of the building. Clover would lease approximately 8,500 square feet of building, outdoor patio, and parking space for restaurant use. The negotiations include stipulations that require a stringent timeline for the completion of the City’s renovations in order for the tenant to begin their tenant improvements. Any delays in construction would both jeopardize securing a lease with the tenant and increase the loss of revenue due to vacancies during construction and immediately thereafter. Therefore, the project schedules requested within the Request for Bids (RFB) and experience in completing similar projects on time were critical in the evaluation and recommendation of award for this project.

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The evaluation committee and interview panel consisted of Architecture Services staff, Airport staff, and the design consultant for the 3200 Airport Avenue building renovation.

Swinerton Builders was recognized in the evaluation and interview process for their indepth understanding of the project, their experience in completing similar projects within similar timelines, and their comprehensive and thoughtful project schedule.

The lowest bidder submitted a very generalized schedule that did not present sufficient information and detail to demonstrate a satisfactory understanding of the scope of work activities and critical elements necessary to build the project as defined in the plans and specifications provided. Staff also reviewed three projects the lowest bidder completed for the City of Santa Monica with contract amounts of $3.9 million, $1 million, and $406,000. The construction durations extended fourteen, twelve and eight months past their original projected completion dates, respectively.

Prior to contemplating a recommendation, staff requested three qualified construction management firms to review and critique the sample project schedules submitted by each contractor. They indicated that Swinerton Builders’ schedule is substantially more thought out and planned, while the lowest bidder’s schedule as submitted is insufficient and unacceptable.

As previously mentioned, any delay to the renovation schedule jeopardizes the execution of a multimillion-dollar lease agreement and would result in additional losses ranging from $34,000 to $58,000 per month due to prolonged vacancies.

The final consideration that informed staff’s recommendation involves the contractors’ relationship and proposed agreement with their subcontractors. During their interview, Swinerton demonstrated a long history of working with their subcontractors as well as the ability to self-perform certain work should their subcontractor for some reason not be able to perform. In addition, their proposed subcontractor agreement stipulates that subcontractor failure to remain on schedule renders them liable for liquidated damages, as well as all costs associated with accelerating the work in order to get back on schedule. In contrast, the low bidder’s sample agreement assesses liquidated damages

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against the subcontractor but remains silent on accelerating the work to meet the original schedule. For these reasons, staff recommends awarding the agreement to Swinerton Builders.

In addition to staff’s recommendation for construction services, staff requests Council approval for construction management services. This would provide contractor oversight to ensure project design intent and milestones are being met.

Vendor Selection
Bidder Recommendation (Contractor)
Best Bidder Swinerton Builders
Evaluation
Criteria
The ability, capacity and skill of the bidder to perform or provide the services; the capacity of the bidder to perform the contract or provide the service promptly, within the time specified, and without delay or interference; the sufficiency of the bidder’s financial resources; the character, integrity, reputation, judgment, training, experience and efficiency of the bidder. The City shall have absolute discretion in determining the applicability and weight of the criteria listed above.

The City is not required to select the bid with the lowest price.

Municipal Code SMMC 2.24.180
RFQual Data
Date
Posted Posted On
Advertised In
(City Charter &
SMMC)
Vendors
Downloaded
Submittals
Received
Date
Publicly
Opened
04/25/22 City's Online
Bidding Site
Santa Monica
Daily Press 96 5 06/01/2022
Bid Data
Date Posted Posted On
Vendors
Downloaded
Date Publicly
Opened
09/29/2022 City's Online Bidding Site 3 11/23/2022
Submittals Received
West Valley Investment
Group, Inc. $6,771,500 Olympos Painting, Inc. $12,141,000 Swinerton Builders $7,899,818 Engineer’s Estimate $7,222,535

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Best Bidder Justification
The decision was made based on the experience and the quality of the firm’s proposed team, their in-depth knowledge of the 3200 Airport Avenue project plans, their longstanding relationships with subcontractors, and the results of their interview with the City.

Bid Protest
On January 23, 2023, West Valley Investment Group, Inc. submitted a bid protest alleging that West Valley was the lowest responsive and best bidder. Although responsive, staff does not believe they are the best bidder. It is critical for the 3200 Airport Avenue Renovation Project to be completed expeditiously to mitigate a potential loss of a $5.3 million lease revenue due to project delays. The second lowest bidder can meet the City’s aggressive schedule and more than justify the difference in cost by minimizing vacancy losses and ensuring the negotiated $5.3 million lease is executed.

In accordance with the appeals procedure set forth in the Notice Inviting Bids, the Public Works Director evaluated the bid protest and issued a final determination recommending Swinerton Builders as the best bidder. A copy of the bid protest and the Public Works Director’s Bid Protest Determination letter are available in Attachments B and C, respectively. In addition, the proposed lease agreement for 3200 Airport Avenue is included in tonight’s agenda for Council consideration.

Bidder Recommendation (Construction Manager)
Best Bidder Totum Corporation
Evaluation Criteria Price; the quality of the services offered; the ability, capacity and skill of the bidder to perform or provide the materials or services; the capacity of the bidder to perform the contract or provide the service promptly, within the time specified, and without delay or interference; the character, integrity, reputation, judgment, training, experience and efficiency of the bidder. The City shall have absolute discretion in
determining the applicability and weight of the criteria listed above.

The City is not required to select the bid with the lowest price.

Municipal Code SMMC 2.24.180

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Bid Data
Date Posted Posted On
Advertise In
(City Charter & SMMC)
Vendors
Downloaded
Date Publicly
Opened
12/09/2022 City's Online
Bidding Site
Santa Monica Daily
Press
60 01/06/2023
Best Bidder Justification
Totum Corporation demonstrated competence, capacity, and the skill in providing construction management services. While all firms who submitted provided experience in managing projects similar to the 3200 Airport Ave Renovation, Totum Corporation’s proposal included a construction manager and construction administration staff into their cost for only 3% more than the lowest bidder. Combined with the positive feedback from previous clients, Totum Corporation is, in staff’s opinion, the best bidder.

Past Council Actions
Meeting Date Description
04/10/18 (Attachment A) Airport’s Property Condition Assessment of nine Airport properties.

Environmental Review
The project is categorically exempt from CEQA pursuant to Section 15301 and Section 15302 of the CEQA Guidelines. Section 15301 exempts Class 1 (Existing Facilities) projects from CEQA, which include the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use. Section 15302 exempts Class 2 (Replacement or Reconstruction) projects which include the replacement or reconstruction of existing structures and facilities where the new structure will be located in the same site as the structure replaced and will have substantially the same purpose and capacity as the Submittals Received
Simpson & Simpson $632,000 Cumming Management
Group $1,154,800
Totum Corporation $653,793

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structure replaced. The project would renovate the existing city facility at 3200 Airport Avenue, and therefore, it has been determined that the project would fall within the Class 1 and Class 2 categorical exemptions. Furthermore, staff has determined that none of the exceptions to Categorical Exemptions set forth in the CEQA Guidelines, section 15300.2 apply to this project.

Financial Impacts and Budget Actions
Staff seeks authority to approve available funding from the Airport Fund to award a contract to Swinerton Builders for construction services and Totum Corporation for construction management services.

Contract/Agreement
Vendor FY 2022-23 CIP Account # Total Contract
Amount
Swinerton Builders C5704690.689000 $7,899,818
Totum Corporation C5704690.689000 $653,793
Total $8,553,611
Prepared By: Phillip Ticun, CIP Project Manager
Approved Forwarded to Council
Attachments:

A. Staff Report 20180410
B. Bid Protest
C. Bid Protest Response
D. Totum_Oaks_Initiative_Disclosure_Form
E. Swinerton_Oaks_Initiative_Disclosure_Form
F. Rendering_1_Office_Space_Exterior
G. Rendering_2_Office_Space_Interior
H. Rendering_3_Office_Space_Interior

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City Council
Report
City Council Meeting: April 10, 2018
Agenda Item: 3.C
1 of 4
To: Mayor and City Council
From: Susan Cline, Acting Assistant City Manager, Public Works, Architecture Services
Subject: Award Agreement for Santa Monica Airport Buildings Property Condition Assessment
Recommended Action
Staff recommends that the City Council:

1. Award RFP# 2508 to Omgivning Architects, a California-based company, to provide a comprehensive building assessment at nine building locations at the Santa Monica Airport;

2. Authorize the City Manager to negotiate and execute an agreement with Omgivning Architects, in an amount not to exceed $756,140 (including a $68,740 contingency) for a total amount not to exceed $756,140 over a two-year period, with future year funding contingent on Council budget approval.

Executive Summary
The City of Santa Monica (City) is the owner/operator of the Santa Monica Airport (Airport) and has leased Airport property and tenant spaces along both sides of Airport Avenue since the 1940s. The Airport is an important municipal asset, maintaining leases with approximately 397 tenants and generating approximately 70% of its revenues from leasing. Due to deferred maintenance, many of the tenant spaces and buildings are showing signs of aging with both structural and non-structural deficiencies.

It is critical for the City to address tenant building issues and deficiencies in a timely manner. Staff recommends an agreement to be awarded to Omgivning Architects in an amount not to exceed $756,140 to provide a comprehensive building assessment at nine building locations at the Santa Monica Airport.

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Attachment: Staff Report 20180410 (5397 : 3200 Airport Ave Renovation Project) 2 of 4
Discussion
Due to the ongoing wear and tear of weather and use over the decades, the frequency of repairs occurring on leased Airport building properties has increased substantially compared to previous years. To extend the life of these buildings, staff is recommending a Property Condition Assessment, which would entail investigating the life expectancy of mechanical, electrical, and plumbing systems, as well as the current structural integrity of the buildings. In-house staff does not have the design expertise for each of these trades required to perform a thorough building assessment. Any issues brought to light by the assessment would be addressed in a future construction project which would make repairs and bring the buildings as a whole to current building codes and standards in the most cost-effective manner. The consultant would also provide the City with an estimated operational budget for each of the properties to better account for their post construction maintenance costs. The Property Condition Assessment would evaluate the following nine Airport locations.
• 2501 Airport Ave.
• 2701 Airport Av
• 2900 Airport Ave.
• 3000 Airport Ave.
• 3011 Airport Ave.
• 3026 Airport Ave.
• 3050 Airport Ave.
• 3200 Airport Ave.
• 3300 Airport Ave.

The scope of the proposed project includes the completion of a comprehensive assessment and initial design drawings on how to address the needed repairs for each of the nine buildings. For each building, an assessment report would be prepared which would include a summary of the overall condition of the buildings with itemized deficiencies to be addressed, schematic designs for the repairs, cost estimates for repairs and annual maintenance/operation costs, and usable square footage totals with a

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Attachment: Staff Report 20180410 (5397 : 3200 Airport Ave Renovation Project) 3 of 4
recommendation for the City to proceed with either refurbishment or replacement. Staff would return to Council at a future date with a recommendation to award construction services to complete the building upgrades as funding becomes available.

Consultant Selection
On January 8, 2018, the City issued a Request for Proposals (RFP) #SP2508 to provide a Property Condition Assessment report, schematic design services and cost estimation services for nine building locations at the Airport. The RFP was posted on the City’s online bidding site, and notices were advertised in the Santa Monica Daily Press in accordance with the City Charter and Municipal Code Section 2.24.075(a). A total of 106 vendors downloaded the RFP. Three firms responded. Responses to the RFP were reviewed by a selection panel of staff from the Public Works Department. • AE3 Partners Architects
• Nonzero \ Architecture
• Omgivning Architects
Evaluation was based on the following selection criteria: experience with similar scopes of work, project approach, project team and references, and prime and sub-consultant past projects. Omgivning Architects was recognized in the evaluation process for their effective project management, completeness, and client responsiveness. Based on this criteria and criteria in SMMC 2.24.073, staff recommends Omgivning Architects as the best qualified firm to provide a comprehensive building assessment at nine building locations at the Santa Monica Airport.

Financial Impacts and Budget Actions
The agreement to be awarded to Omgivning Architects is for an amount not to exceed $756,140. Funds are available in the FY 2017-18 Capital Improvement Program budget in account M339088.589000.

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Attachment: Staff Report 20180410 (5397 : 3200 Airport Ave Renovation Project) 4 of 4
Prepared By: Phillip Ticun, CIP Project Manager
Approved Forwarded to Council
Attachments:

A. Omgivning Architects Oaks Initiative Form

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Attachment: Staff Report 20180410 (5397 : 3200 Airport Ave Renovation Project)

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Attachment: Bid Protest (5397 : 3200 Airport Ave Renovation Project)

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Attachment: Bid Protest (5397 : 3200 Airport Ave Renovation Project)

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Attachment: Bid Protest (5397 : 3200 Airport Ave Renovation Project)

1685 Main Street, MS#18, Santa Monica, CA 90401 • www.santamonica.gov • @cityofsantamonica • @santamonicacity
Public Works Department
February 1, 2023
Willie Tarazi, President
West Valley Investment Group, Inc.
18750 Oxnard Street, Suite #405
Tarzana, CA 91356
Subject: Final Determination for Request for Bids (RFB) 3200 Airport Avenue Renovation (SP2486)
Dear Mr. Tarazi,
I have received West Valley Investment Group’s (WVIG) protest letter, dated January 23, 2023, for SP2486 RFB 3200 Airport Ave Renovation (Project).

I reviewed your concerns and provided my findings below:

1. “… under no circumstances were we not awarded a contract whenever we came in lowest…”
The Santa Monica Municipal Code requires the City to award contracts to the best bidder. In doing so, it may evaluate the capacity of the bidder to perform the contract or provide the service promptly, within the time specified based on prior experience. As an example, WVIG offered the Parking Structure #5 Project in its selection of prior projects. The project duration was 274 days and completed in 441 days.

2. “… we were invited to bid on the 3200 Airport Avenue one-story building renovation project and were prequalified for that bid, which implies that we were vetted and deemed capable of taking care of such a project…” The solicitation was broken down into two steps. The first step was the Request for Qualifications which identified four contractors who were capable of

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Attachment: Bid Protest Response [Revision 1] (5397 : 3200 Airport Ave Renovation Project)

constructing the Project, including WVIG. The second step requested additional information and helped determine which of the prequalified contractors had the most experience with similar projects, the best project understanding/schedule, and the best subcontractor support. WVIG did not emerge as the best bidder during this phase.

3. “… the only reason why it was recommended that the project be awarded to Swinerton is because their timeline was favored to ours. With a highly daily liquidated damages rate, we have every reason to complete the project within the allocated period of time. We have also informed the City that we will not be involved in any other project while working on this one to make sure that all our available resources will be allocated here.”
The best bidder was not based solely on the duration of the contractor’s provided schedule. As mentioned previously the best bidder selection was based on having the most experience with similar projects, the best project understanding/schedule, and the best subcontractor support. While WVIG indicated during the interview that they would focus solely on this project, the proposed 2-3 staff management team represented a fraction of management teams proposed by other bidders to meet the aggressive timeline. In addition, it was identified that the sub-contractor recommended by WVIG for the glazing portion of the Project, had repeated issues in measuring and fabricating glass on a previous city project. Having such issues on the Project could heavily impact the schedule since the procurement of the windows is a critical path item.

4. Per Public Contract Code (PCC) Division 2, General Provisions, any solicitation for bids shall include a section identifying and describing the criteria that will be used in evaluation bids, the methodology or weighting system that will be used in the evaluation, and the relative importance or weight assigned to the criteria identified in the request for bids.

The City is subject to the provisions of the Santa Monica Municipal Code for contracts involving the construction of public works projects. The Instruction to Bidders of the Request for Bids includes a section titled “Best Bidder” which reads:

The award, if any, will be made to the best bidder. In evaluating whether a bidder is the best bidder pursuant to the Santa Monica Municipal Code, City may utilize some or all of the following criteria:
(1) Price.
(2) The quality of the material or services offered.
(3) The ability, capacity, and skill of the bidder(s) to perform the contract or provide the materials or services.
(4) The capacity of the bidder(s) to perform the contract or provide the service

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Attachment: Bid Protest Response [Revision 1] (5397 : 3200 Airport Ave Renovation Project)

promptly, within the time specified, and without delay or interference. (5) The sufficiency of the bidder’s financial resources. (6) The character, integrity, reputation, judgment, training, experience, and efficiency of the bidder.
(7) The ability of the bidder(s) to provide such future maintenance or service as may be needed.
(8) Any other factor which will further the intent set forth in Section 608 of the City Charter.

The City of Santa Monica (the “City”) shall have absolute discretion in determining the applicability and weight or relative weight of some or all of the criteria listed above and is not required to select the lowest monetary bidder.

At this time, I find no reason to alter the RFB scores and will proceed with awarding this project as noted in the Award Notification for 3200 Airport Ave Renovation Project. This constitutes a final decision on this protest. Thank you for your continued interest in our City’s projects.

Respectfully,
Rick Valte, P.E.

Public Works Director

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Attachment: Bid Protest Response [Revision 1] (5397 : 3200 Airport Ave Renovation Project)

CITY OF SANTA MONICA OAKS INITIATIVE DISCLOSURE FORM
In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity.

Public benefits include:

1. Personal services contracts in excess of $25,000 over any 12-month period;

2. Sale of material, equipment or supplies to the City in excess of $25,000 over a 12- month period;

3. Purchase, sale or lease of real property to or from the City in excess of $25,000 over a 12- month period;

4. Non-competitive franchise awards with gross revenue of $50,000 or more in any 12-month period;

5. Land use variance, special use permit, or other exception to an established land use plan, where the decision has a value in excess of $25,000;

6. Tax “abatement, exception, or benefit” of a value in excess of $5,000 in any 12- month period; or

7. Payment of “cash or specie” of a net value to the recipient of $10,000 in any 12- month period.

Name(s) of persons or entities receiving public benefit:

Name(s) of trustees, directors, partners, and officers:

Name(s) of persons with more than a 10% equity, participation, or revenue interest:

Prepared by: Title:

Signature: Date:

Email: Phone:

FOR CITY USE ONLY:

Bid/PO/Contract # Permit #
Danny Kaye President
[email protected] 3103510138
1/5/23
Totum Corp
Giulio Zavolta
Danny Kaye
As above

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Attachment: Totum_Oaks_Initiative_Disclosure_Form (5397 : 3200 Airport Ave Renovation Project)

CITY OF SANTA MONICA OAKS INITIATIVE DISCLOSURE FORM
In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity.

Public benefits include:

1. Personal services contracts in excess of $25,000 over any 12-month period;

2. Sale of material, equipment or supplies to the City in excess of $25,000 over a 12- month period;

3. Purchase, sale or lease of real property to or from the City in excess of $25,000 over a 12- month period;

4. Non-competitive franchise awards with gross revenue of $50,000 or more in any 12-month period;

5. Land use variance, special use permit, or other exception to an established land use plan, where the decision has a value in excess of $25,000;

6. Tax “abatement, exception, or benefit” of a value in excess of $5,000 in any 12- month period; or

7. Payment of “cash or specie” of a net value to the recipient of $10,000 in any 12- month period.

Name(s) of persons or entities receiving public benefit:

Name(s) of trustees, directors, partners, and officers:

Name(s) of persons with more than a 10% equity, participation, or revenue interest:

Prepared by: Title:

Signature: Date:

Email: Phone:

FOR CITY USE ONLY:

Bid/PO/Contract # Permit #
Swinerton Builders, a California Corporation
See attached list of officers None Kyle Burnham
Sr. Preconstruction Manager
1/20/2023 [email protected] 213-896-3400

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Attachment: Swinerton_Oaks_Initiative_Disclosure_Form (5397 : 3200 Airport Ave Renovation Project) Test Cell, Buildings 203/204 | 1. General Contractor Information

OWNERSHIP INFORMATION

NAME POSITION YEARS WITH COMPANY
Eric M. Foster CEO 40
David C. Callis President, COO 21
Donald D. Adair Exec. Vice President 34
Scott V. Conrad Exec. Vice President 11
Frank Foellmer Exec. Vice President 28
Bradley K. Peterson Exec. Vice President/CFO 22
Jason R. Chupp Sr. Vice President 10
Ray A. Haj Sr. Vice President 21
Timothy J. Kretzschmar Sr. Vice President 8
Terry M. McKellips Sr. Vice President 22
SheriAnn Murphy Sr. Vice President/Secretary 16
Lauren T. Nunnally Sr. Vice President/CAO 8
David K. White Sr. Vice President 13
Michael M. Berryhill Vice President 7
Ciaran Creighton Vice President 6
Keith Dancey Vice President 19
Christopher A. Evans Vice President 14
Jeffrey S. Gee Vice President 20
Jeffrey F. Good Vice President 14
D. Scott Grubb Vice President 36
Lori D. Guion Vice President 24
Peter Hau Vice President 18
Paul Hinz Vice President 22
Jared W. Hoeflich Vice President 11
Robert "Bobby" Jennings Vice President 12
Curtis F. Johnson Vice President 36
Brian J. McCarthy Vice President 12
Gerald E. Mejia Vice President 21
Derek D. Mosiman Vice President 12
Andrew D. Pearl Vice President 15
Brenda A. Reimche Vice President 29
Pedro "Pete" Ruiz Vice President 20
Alison Satt Vice President 6
Carrie L. Shaeffer Vice President 8
John S. Spight Vice President 10
Lia Tatevosian Vice President 26
Myrna E. Wagner Vice President 23
James T. Watson Vice President 7
Tyler Whittaker Vice President 4
David R. Worley Vice President 20
Aaron J. Yamasaki Vice President 10
Darlene S. Cho Asst. Secretary 19
Lisa M. Telles Asst. Secretary 18
Swinerton Builders is a whollyowned subsidiary of Swinerton Incorporated.

Swinerton Incorporated is 100%
employee-owned. Approximately
45% is held by the Swinerton
401(k) & Savings Plan, and the
balance is split among 800 plus
employees. No single individual
employee owns 4% or more of the
stock of the Corporation.

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Attachment: Swinerton_Oaks_Initiative_Disclosure_Form (5397 : 3200 Airport Ave Renovation Project)

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Attachment: Rendering_1_Office_Space_Exterior (5397 : 3200 Airport Ave Renovation Project)

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Attachment: Rendering_2_Office_Space_Interior (5397 : 3200

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Attachment: Rendering_3_Office_Space_Interior (5397 : 3200 City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 5.D
1 of 6
To: Mayor and City Council
From: Edward F King, Director, Department of Transportation, Finance & Administrative Services
Subject: Authorization of 6th Modification to Contract #8928 with Trapeze, Inc. for Vehicle and Operator Scheduling Systems
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines.

2. Authorize the City Manager to negotiate and execute a sixth modification to #8928 (CCS) for $527,781 with Trapeze Group to extend maintenance support of the Trapeze operator and vehicle scheduling systems for two additional years through June 30, 2025, to configure the operator scheduling module to accommodate a shortened workweek in an effort to improve operator work-life balance for staff retention purposes, to add up to two additional absence codes to the OPS Timekeeping module, and to train staff on the use of the Timekeeping module. This will result in a 13-year amended agreement with a new total amount not to exceed $3,666,991 with future year funding contingent on Council budget approval.

Summary
The Department of Transportation’s Big Blue Bus division (BBB) maintains a warranty contract with Trapeze Group to support proprietary software and hardware for modules that perform various functions required to operate a public transportation system.

Trapeze is the exclusive service provider for these proprietary products. The final option year for this contract with Trapeze expires on June 30, 2023.

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This contract, #8928 (CCS), covers support for a group of integrated products that manage vehicle scheduling, operator work assignment scheduling, operations payroll and data management, and the collection, analysis, and transfer of vehicle and operator scheduling data to other systems critical to the efficient management of a transit system of BBB’s size and scope. One of the BBB systems with which these Trapeze modules interface is the new computer-aided-dispatch/automated vehicle location (CAD-AVL) and voice-over-internet protocol (VoIP) radio system that is currently being implemented by Clever Devices. The CAD-AVL/radio system implementation, which is proceeding on time and under budget, is expected to wrap up late in FY2023-24.

A sixth modification covering two additional one-year options is therefore needed to extend the contract with Trapeze to ensure the continuity of services throughout the implementation of the new CAD-AVL system, and to allow staff to make improvements to Motor Coach Operator (MCO) schedules to provide for a 4-day workweek. A contract extension will also allow BBB to complete a competitive procurement process for a new vehicle and operator scheduling system as the current system has been in use since 2009. An extension of two additional option years through June 30, 2025, will allow adequate time for both the procurement and installation of a new vehicle and operator scheduling system, and the installation and implementation of BBB’s new CAD-AVL/ radio system.

Discussion
BBB uses Trapeze software systems to manage its daily operations and to provide reports and required data to federal, state, and local regulatory bodies and funding sources. Contract #8928 with Trapeze allows BBB to operate and maintain its Operator Management (OPS) and Planning (BlockBuster and FX) software systems.

Trapeze OPS tracks work assignments, motor coach operator sign-in, accidents, incidents, training, certifications, and operator communications via interactive voice response and web, as well as performing payroll management functions. The Trapeze OPS module also provides staff with data to ensure daily schedule efficiencies, and that all MCO hours comply with Federal and State mandated driving work rules for MCOs.

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Trapeze BlockBuster and FX facilitate the planning and scheduling of the work assignments that are then managed by OPS. The scope of services for contract #8298 also includes maintenance of several vital Trapeze sub-modules, including InfoCom and Mapmaker, which support motor coach operator (MCO) communications and scheduling adjustments respectively, as well as OPS-SIT (MCO Sign-on Terminal) a clocking-in system; OPS Interactive Voice Response and OPS Web which support communications with Motor Coach Operators; and other planning and operations functions.

In 2022, a fifth modification to contract #8928 added the Trapeze modules OPS-MON and TSDE to facilitate the flow of data from OPS to the CAD/AVL system currently being installed. The implementation of OPS-MON and TSDE is underway and will be completed within the next few months.

BBB will be engaging in a competitive procurement process in 2023 to replace the vehicle and operator scheduling systems, which last underwent a major upgrade in 2017. However, since the procurement and implementation processes will take months to complete, staff recommends extending the existing contract. Extending this contract will ensure BBB’s existing system remains supported for the duration of the competitive procurement and implementation process and throughout the implementation of the new CAD/AVL-radio system with which the systems under this contract interface. It is therefore recommended that the contract be extended for two additional option years through June 30, 2025. The cost of two years of warranty maintenance support for all modules covered by Contract #8928 is $426,780.

In addition to the two option-year warranty extensions, two other tasks are included in this sixth modification:

1. Due to the complexity of the OPS system as well as staffing changes in recent years since the last upgrade and training, staff requested that Trapeze do a health check of the timekeeping module that manages timekeeping for nearly 300 motor coach operators, make recommendations for usage and training, and deploy up to two new absence codes.

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2. As part of a retention strategy aimed at providing more flexible work scheduling options for MCOs, staff will be piloting a four-day work schedule with 10-hour work runs and three days off weekly. The OPS operator scheduling system is currently not configured to offer this schedule, so customization is required by Trapeze to be able to implement it.

Table 1, below, shows the cost breakdown of all services covered by the proposed 6th modification.

Table 1
Item Cost
Maintenance Support original modules July 1, 2023-June 30, 2024 $192,749.00 Maintenance Support original modules July 1, 2024-June 30, 2025
$206,695.00
Maintenance Support new modules under 5th mod. July 1, 2024- June 30, 2025
$27,336
OPS compressed workweek configuration services $53,500
OPS new absence codes (up to 2) and timekeeping health check and training S47,501
$527,781
Environmental Review
The contract modification is categorically exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines. The contract modification is covered by the common sense exemption which states that CEQA does not apply, “where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” The modification will provide the City with software and hardware for modules required to operate a public transportation system. Therefore, it can be seen with certainty that the proposed modification would not result in adverse physical impacts on the environment, and as such, is categorically exempt from CEQA.

Past Council Actions
Meeting Date Description
4/28/2020 Approval of Extension of Software Maintenance Contracts

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(attachment A) with Trapeze, Inc.
5/25/2021 Award Contracts to Procure, Install, and Maintain Transit Radio and Computer-Aided Dispatch/Automatic Vehicle
Location (CAD/AVL) Systems at Big Blue Bus, Department
of Transportation
Financial Impacts and Budget Actions
Staff seeks authority to approve available funding from the Big Blue Bus Fund to increase the amount of contract #8928 with Trapeze Group for the additional two years of maintenance support through June 30, 2025, as well as support for the OPS Timekeeping module and the configuration and implementation of the OPS software to allow for a 4-day work week for MCOs.

Contract Modification Request
Agreement #
Current
Authorized
Amount
FY 2022-23
Request
Amount
Future Years
Request
Amount
Dept/CIP Account
#
Total Revised
Contract
Amount
8928 $ 3,139,210 $101,001 $426,780 C6004770.689000 $3,666,991 Future year funding is contingent on Council budget approval.

Prepared By: Barbara Andres, Customer Experience and Innovation Administrator
Approved Forwarded to Council
Attachments:

A. Approval of Extension of Software Maintenance Contracts with Trapeze, Inc. (Web Link)

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B. Award Contracts to Procure, Install, and Maintain Transit Radio and ComputerAided Dispatch/Automatic Vehicle Location (CAD/AVL) Systems at Big Blue Bus, Department of Transportation (Web Link)
C. CCS 8928 - Original Agreement
D. CCS 8928 1st Change Order
E. CCS 8928 - 2nd Change Order
F. Trapeze_OPS_3rd_Change Order
G. 04 Trapeze OPS - 4th Change Order
H. Trapeze OPS-FXBBB CSA 5th Modification
I. OAKS INITIATIVE FORM_Trapeze_June 2022

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Packet Pg. 104 Attachment: CCS 8928 - Original Agreement (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 119 Attachment: CCS 8928 1st Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 129 Attachment: CCS 8928 1st Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 130 Attachment: CCS 8928 1st Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 131 Attachment: CCS 8928 1st Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 132 Attachment: CCS 8928 1st Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 133 Attachment: CCS 8928 1st Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 134 Attachment: CCS 8928 1st Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 135 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 136 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 140 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 141 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 142 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 143 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 144 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 145 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 146 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 147 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 148 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 149 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 150 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 151 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 153 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 160 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 161 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 162 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 163 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 164 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 166 Attachment: CCS 8928 - 2nd Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling 1 June 2019
Contract No. 8928 (CCS)

THIRD MODIFICATION OF
SOFTWARE LICENSE AGREEMENT NUMBER 8928 (CCS)
This Third Modification of Agreement Number 8928 (CCS) (“Third Modification”), entered into as of ______________, 2019, by and between the City of Santa Monica, a municipal corporation (“City”), and Trapeze Software Group, Inc. (“Trapeze”) is made with reference to the following:

RECITALS
A. On or about February 10, 2009, City and Trapeze entered into a Software License Agreement Number 8928 (CCS) for an Operator Management System and Customer Service Software for the Big Blue Bus, with certain years of maintenance costs included (“Original Agreement”).

B. On or about April 8, 2016, City and Trapeze entered into a First Modification of the Software License Agreement Number 8928 (CCS) (CCS) (“First Modification”) for additional years of software maintenance and additional customized reports.

C. On or about October 6, 2017 City and Trapeze entered into a Second Modification of the Software License Agreement Number 8928 (CCS) (“Second Modification”) to implement an upgrade of the Trapeze system to Version 16 of the applicable Trapeze software. The Original Agreement, First Modification and Second Modification may be referred to collectively herein as “the Agreement.” D. City and Trapeze desire to modify the Agreement to extend maintenance services and to receive software upgrades for the year commencing July 1, 2019 and continuing through June 30, 2020 (“Year 8”) on the terms and conditions set forth herein.

TERMS AND CONDITIONS
Now, therefore, the undersigned parties do hereby mutually agree to modify the Agreement as follows:

1. Maintenance and Support Services. The Agreement shall be amended to extend the maintenance, support services and upgrades for the Licensed Products, including the Upgraded Trapeze System, for one additional year, namely, Year 8. This includes upgrades and unlimited technical support for all components of the Operator Management System (OPS), BlockBuster/FX, InfoCom, MapMaker, OPSSIT, and OPS-IVR. The upgrades shall be implemented in accordance with the Maintenance Schedule attached hereto as Exhibit A-1.

2. Maintenance Fees. Section 6(C) of the Original Agreement, as amended by Section 2 of the First Modification, shall be amended to include maintenance and support fees for Year 8 as follows: “(viii) Year 8: $148,908,. The total amount of DocuSign Envelope ID: 88097E7E-6441-4EB3-9E77-142F8C61FD4D 8/12/2019

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Packet Pg. 167 Attachment: Trapeze_OPS_3rd_Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling 2 June 2019
additional maintenance fees for Year 8 shall not exceed $148,908.”

3. Exhibits. Exhibit A-1 is attached hereto and incorporated herein by this reference.

4. Full Force and Effect. Except as expressly modified by this Third Modification, all other terms and conditions of the Agreement shall be and remain in full force and effect.

IN WITNESS WHEREOF, the parties have executed this Third Modification as of the date and year first written above.

ATTEST:
______________________________

DENISE ANDERSON-WARREN
City Clerk
APPROVED AS TO FORM:
______________________________

LANE DILG
City Attorney

CITY OF SANTA MONICA,
a municipal corporation
By: ______________________________

RICK COLE
City Manager
ABC Corporation
#VENDOR
By: _______________________________
DocuSign Envelope ID: 88097E7E-6441-4EB3-9E77-142F8C61FD4D City Attorney
7/31/2019
Lane Dilg
Trapeze Software Group
8/9/2019
Approved
Steve Sawyer, General Manager
Assistant City Manager
Katie Lichtig
8/12/2019
City Clerk
Denise Anderson-Warren
8/12/2019

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Packet Pg. 168 Attachment: Trapeze_OPS_3rd_Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling 3 June 2019
DocuSign Envelope ID: 88097E7E-6441-4EB3-9E77-142F8C61FD4D

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Packet Pg. 169 Attachment: Trapeze_OPS_3rd_Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 170 Attachment: 04 Trapeze OPS - 4th Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 171 Attachment: 04 Trapeze OPS - 4th Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling

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Packet Pg. 172 Attachment: 04 Trapeze OPS - 4th Change Order (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit Scheduling 1 FIFTH MODIFICATION OF
SOFTWARE LICENSE AGREEMENT NO. 8928 (CCS)
This Fifth Modification of Agreement Number 8928 (CCS) (“Fifth Modification”), entered into as of _________________(“Execution Date”), by and between the City of Santa Monica, a municipal corporation (“City”), and Trapeze Software Group (“Trapeze”) is made with reference to the following:

RECITALS
A. On or about February 10, 2009, City and Trapeze entered into a Software License Agreement Number 8928 (CCS) for an Operator Management System and Customer Service Software for the Big Blue Bus, with certain years of maintenance costs included (“Original Agreement”).

B. On or about April 8, 2016, City and Trapeze entered into a First Modification of the Software License Agreement Number 8928 (CCS) (CCS) (“First Modification”) for additional years of software maintenance and additional customized reports.

C. On or about October 6, 2017, City and Trapeze entered into a Second Modification of the Software License Agreement Number 8928 (CCS) (“Second Modification”) to implement an upgrade of the Trapeze system to Version 16 of the applicable Trapeze software.

D. On or about August 12, 2019, City and Trapeze entered into a Third Modification of the Software License Agreement Number 8928 (CCS) (“Third Modification”) to extend maintenance services and to receive software upgrades for the year commencing July 1, 2019 and continuing through June 30, 2020 (“Year 8”).

E. On or about June 4, 2020, City and Trapeze entered into a Fourth Modification to extend maintenance services for two years (“Year 9” and Year “10”) commencing on July 1, 2020 and continuing through June 30, 2022, and one additional option to renew through June 30, 2023 (“Year 11”). The Original Agreement, First Modification, Second Modification, Third Modification, and Fourth Modification may be referred to collectively herein as “the Agreement.”
F. The City and Trapeze desire to modify the Original Agreement to add and incorporate the terms and conditions under which Trapeze will provide licenses for Trapeze Standard Data Exchange (TSDE) Software and Trapeze OPS-MON Software (“New Licensed Products”), and Trapeze Standard Data Exchange (TSDE) and OPS-MON installation services, maintenance, and support (“Additional Services”), on the terms and conditions set forth herein.

TERMS AND CONDITIONS
Now, therefore, the undersigned parties do hereby mutually agree to modify the Original Agreement as follows:

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74 9/26/2021

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Packet Pg. 173 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit 2 1. Section 3 of the Original Agreement entitled “License Use” shall be modified by adding the following paragraph:

New Licensed Products. Trapeze will provide Trapeze Standard Data Exchange (TSDE) Software licenses and Trapeze OPS-MON Software licenses (“New Licensed Products”) described in Exhibit A-5, Scope of Services, Trapeze Standard Data Exchange (TSDE), and Exhibit B-5, Scope of Services, Trapeze OPS-MON. Trapeze will provide the New Licensed Products in accordance with Exhibit C-5, Budget.

2. Section 4 of the Original Agreement entitled “Software Services” shall be modified by adding the following paragraph:

Additional Services. Trapeze will perform all of the installation, maintenance and support services (“Additional Services”) described in Exhibit A-5, Scope of Services, Trapeze Standard Data Exchange (TSDE) and Exhibit B-5, Scope of Services, Trapeze OPS-MON. Trapeze will complete the Additional Services in accordance with Exhibit C-5, Budget.

3. Section 6 of the Original Agreement entitled “License Fees and Support Services Fees” shall be modified by adding the following paragraph:

Compensation for New Licensed Products and Additional Services.

The City will compensate Trapeze for the New Licensed Products and Additional Services in an amount not to exceed $255,180, as set forth in Exhibit C-5. The total contract price for services pursuant to the Original Agreement, the First Modification, the Second Modification, the Third Modification, the Fourth Modification, and this Fifth Modification shall not exceed $3,139,210.

4. Exhibit A-5, Exhibit B-5, and Exhibit C-5 are attached hereto incorporated herein by this reference.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 174 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit 3 5. Except as expressly modified by this Fifth Modification, all other terms and conditions of the Original Agreement shall be and remain in full force and effect.

IN WITNESS WHEREOF, the parties have executed this Second Modification as of the date and year first written above.

ATTEST:
______________________________

DENISE ANDERSON-WARREN
City Clerk
APPROVED AS TO FORM:
______________________________

LANE DILG
City Attorney

CITY OF SANTA MONICA,
a municipal corporation
By: ______________________________

RICK COLE
City Manager
ABC Corporation
#VENDOR
By: _______________________________
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74 George S. Cardona
Interim City Attorney
9/23/2021
VP, Finance
dm
9/23/2021
Deborah Mills
9/26/2021
John Jalili
Interim City Manager
10/1/2021
Nikima Newsome
Assistant City Clerk

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Packet Pg. 175 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit 4 Exhibit A-5
Scope of Services, Trapeze Standard Data Exchange (TSDE) DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 176 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Introduction l Page 1 Introduction
The purpose of this document is to provide Big Blue Bus ( BBB ), with a quote and scope of work for the deployment of our Trapeze Standard Data Exchange (TSDE) for FX. By implementing TSDE, BBB will be able to pass data from Trapeze FX/BB to the downstream 3rd party consumers specifically the CAD/AVL System from Clever. This document outlines the implementation services to be provided by Trapeze, as well as the support required from BBB and Clever staff and resources.

Trapeze Professional Services
Personnel
To ensure successful completion of this implementation, Trapeze will utilize the following professional services personnel:

Project Manager: The centralized point of contact for the project. The project manager is responsible for coordinating project schedules, deliverables and resources required to deliver the deliver the Trapeze solution as defined in this statement of work.

Technical Product Specialist(s): The primary technical point(s) of contact supporting the design, installation, configuration, testing, implementation, training, and deployment of the Trapeze solution.

Implementation Methodology Overview
This project will be executed in a phased approach, with key activities identified below:

1. Project Kick-Off

2. Project Design

3. Internal Acceptance Testing

4. Software Installation and Configuration

5. Installation Testing

6. Training

7. Acceptance Testing

8. Deployment and Closure
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 177 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Implementation Approach l Page 2 Project Implementation Approach
Project Kick-Off
Following contract execution, Trapeze, BBB and Clever will hold a remote project kick-off meeting to align stakeholders on project scope and timelines, as well as review roles, responsibilities, key risks, and preliminary project schedule. Project teams from Trapeze, BBB and Clever (as required) are expected to attend the kick-off meeting.

Project Design
The Project Design meetings for TDSE will be held remotely over the course of up to one (1) day. In preparation for these discussions, BBB/Clever will be expected to provide Trapeze with any relevant operational materials and/or documentation requested.

The following topics will be covered during these meetings and calls:

BBB
Current operational environment (policies/procedures) as they relate to CAD/AVL System Software configuration
Hardware recommendations (as necessary)
Project timelines
Testing, training, and transition strategies
A preliminary Project Design Document outlining deliverables, goals and objectives, configurations, and expected project timelines for the implementation will be prepared by Trapeze and shared with BBB/Clever after the initial Project Design meetings. During the review process, non-standard Software functionality may be identified beyond any in-scope customizations. If desired, Trapeze will provide estimates to address these gap items, however addressing any such gaps will be considered out-of-scope and may result in additional costs.

Following completion of the preliminary Project Design Document, Trapeze will provide BBB/Clever with the document to review and provide comments. BBB/Clever will have five (5) business days to complete this review, after which the Trapeze project manager will coordinate a meeting with BBB/Clever comments. During this meeting, Trapeze will revise the Project Design Document to address BBB/Clever comments and feedback and will provide a finalized Project Design Document.

Internal Acceptance Testing
Internal Acceptance Testing (IAT) is completed by Trapeze before any Software is installed in BBB environment. During IAT, Trapeze testing specialists will perform unit and regression testing to ensure DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 178 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Implementation Approach l Page 3 completeness and accuracy of all standard features. These specialists will also update any automated regression test scripts to expand coverage as needed.

After unit and regression testing is completed, Trapeze Technical Product Specialists will run a series of tests in a local testing environment to ensure that all Software is functioning properly against BBB This allows Trapeze to proactively determine any potential data-related issues and ensures that all standard setup and configuration tasks can be performed for BBB, as well as validates that all branded Software is functioning as expected.

Software Installation and Configuration
Following the completion IAT, Trapeze will work with Clever and BBB to remotely install and configure the Software in BBB test and production environment. The installation into test environment will be used to carry out the testing activities. The production environment will be used to export the most current signup data to TSDE format, but will go live only during deployment activities after completion of the acceptance testing in BBB test environment. BBB will be required to complete all hardware installations (including all server configurations) in time for the installation. To assist Trapeze with the installation, BBB will provide remote access (VPN, etc.) to all necessary servers. If remote access is unavailable, Zoom will be used as an alternate method for connecting to the servers.

Installation Testing
Installation Testing will occur after the new Software has been installed in BBB test environment. This testing is designed to ensure the Software is functioning properly within BBB as well as with third party software, as necessary. Installation Testing will also ensure successful demonstration of all requirements as documented in the Project Design Document.

During Installation Testing, BBB will grant Trapeze access to their servers so that Trapeze can perform testing of key Software functionality and validate the Software is functioning properly in BBB Installation Testing, Trapeze will validate the following:

Applications are connected to the appropriate database(s) General Software functionality is working as designed
All configurations and settings are functioning as agreed upon in the Project Design Document Upon completion of Installation Testing, Trapeze will work with BBB to schedule training.

Training
Training Requirements
In order to facilitate remote training, BBB will need to ensure attendees are able to access online Zoom meetings as well as the BBB test environment from their current place of work.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 179 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Implementation Approach l Page 4 In addition to training, Trapeze will provide one (1) digital copy of all available user manuals to BBB. If desired, BBB can create additional hard copies for their users.

Training Delivery
Trapeze product training is based on standard training agendas, and sessions vary in length based on topic.

BBB
the Project Design activities. Training sessions cannot exceed eight (8) employees per session. The training will also include a refresher overview of how to identify data integrity errors to proactively detect issues within the FX data. The following table outlines the proposed training for this implementation:

Module Training Topic Duration (Days) On-site/Remote
TSDE and System
Administrator Training 2.0 Remote
and System Administrator
approach and the BBB SMEs are expected to train any additional end-users if required. Trapeze proposes that the any SME training zoom sessions to be recorded by BBB to train other end-users when needed.

Acceptance Testing
Acceptance Testing involves BBB utilizing the new Trapeze Software in the test environment to ensure it responds accurately to user inputs and all features and functions work as specified in the Project Design Document.

BBB will have ten (10) business days in which to perform an initial comprehensive end-to-end round of Acceptance Testing.

All subsequent end-to-end rounds of Acceptance Testing must be completed in no more than five (5) business days.

Testing Defect Review Tracking and Resolution
During Acceptance Testing, BBB will document and prioritize any defects encountered throughout the testing period (if any exist). Following the completion of a round of testing, BBB will supply Trapeze with a complete list of all perceived defects, which Trapeze will assess for root cause and resolve where appropriate based on the severity levels defined below.

1. Critical Defect causes failure of critical functionality or critical data and no workaround is available. o This can include but is not limited to:

System crashing
Non-recoverable conditions
Data loss or corruption
Security concerns leading to breach of information and/or misuse, or severely affecting system performance and/or functionality.

Performance defects leading to unavailability or loss of functionality.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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2. Major Defect partially impairs critical functionality. A workaround is available but difficult to execute. o This can include but is not limited to:

System crashing or aborting during normal operation of a non-critical flow.

Missing functionality
Inconsistent logic or display of data.

Slow responsiveness and underperformance of the system
Missing security or system patches, minor breach of information

3. Minor Defect impairs non-critical functionality with a satisfactory workaround available. o This can include but is not limited to:

Minor usability issues such as inconsistent display
Tab/shortcut keys not working.

Missing input validation
System recoverable errors
BBB will identify the priority of each defect and indicate the desired resolution sequence (1 = soonest resolution desired). Trapeze will make best reasonable effort to resolve defects of the same severity levels based on sequential order.

At the completion of each round of testing, Trapeze will work remotely to resolve all critical and major defects (if any exist). If an updated Software solution is required to resolve the defect(s), Trapeze will provide the updated Software encompassing all defect fixes. BBB will be asked to test and validate the Software to ensure all defects have been rectified. If further defects are identified, Trapeze will evaluate and work to resolve them, and BBB will be asked to execute another round of Acceptance Testing.

Once BBB confirms that all critical and major defects have been resolved, Acceptance Testing will be considered complete and the Software deemed ready for production use. BBB will be required to sign off on the Acceptance Testing. All minor defects will be transitioned to the Trapeze maintenance and support program, who will provide new Software builds addressing post-deployment defects, as necessary.

Deployment and Closure
During the deployment activities, Trapeze will begin to export data to TSDE from BBB to support operations.

Deployment Support
Trapeze will provide remote go-live support for the launch of the new Software over the course of one (1) week . BBB can leverage these services during standard
business hours to address any non-critical questions or support needs that may arise from using the Software to support live operations.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 181 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Responsibilities and Deliverables l Page 6 Closure
At the completion of the one (1) week deployment support period, all ongoing support will continue to be provided -term maintenance program. At this time, the project will be considered complete and project closure will be processed.

Responsibilities and Deliverables
Activity
Trapeze
Responsibilities
BBB Responsibilities Deliverables
Project Kick-Off
Lead project
kick-off
meeting
Develop and
maintain
project
schedule
Provide input for BBB-led
activities
Provide database
backup
Ensure all appropriate
staff attend the kick-off
meeting
Assist with developing
and maintaining the
project schedule
Kick-Off
meeting
Preliminary
project
schedule
(revised as
necessary)
Preliminary
Project Plan
Project Design
Conduct
Project
Design
meetings
Participate in Project
Design meetings
Provide documentation
as requested
Review Project Design
Document and provide
comments/feedback
Sign off on finalized
Project Design Document
Finalized
Project
Design
Document
Finalized
Project
Schedule
Internal Acceptance
Testing
Perform
Internal
Acceptance
Testing
Provide data as
necessary
Software Installation
and Configuration
Install
Software in
BBB
and
production
environment
Complete all hardware
installation(s)
Provide access to test
environment
Manage servers,
databases, backup
procedures, database
maintenance practices,
and Windows
environments and
security
Install Trapeze prerequisite Software (e.g.

ODBC connections,
database servers, etc.)
Installed
Software in
BBB
and
production
environment
Installation Testing
Perform
Installation
Testing
Provide technical
consulting as required
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 182 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Duration l Page 7 Provide access to test
environment
Training
Review
training
topics with
BBB
Conduct
training
session(s)
Provide training facilities
with network connectivity
and individual
workstations for each
participant per class
Reproduce training
materials and provide
printed copies for all
class participants and
instructor
Ensure trainees are
prepared and engaged in
the training activities
Training
agenda
Completed
training
session(s)
Available
user
manuals
Acceptance Testing
Support BBB
during
Acceptance
Testing
Perform Acceptance
Testing
Complete prioritization of
defect(s)
Re-test defect
resolutions
Escalate defects to the
appropriate Trapeze
resource
Prioritized
defects log
Software
releases, as
necessary
Deployment and
Closure
Migrate
Software to
BBB
production
environment
Provide
remote
support for
one (1) week
for Software
rollout
Escalate defects to
appropriate Trapeze
Technical Product
Specialists
Update production
system to ensure all
records are up to date
Ensure data accuracy
Confirm connectivity,
logins, etc.

Trapeze
Software is
operational
and
functional in
BBB
production
environment
Project Duration
This implementation is expected to be completed within three (3) months from the completion of the project kick-off meeting. Following contract execution, a mobilization period of up to forty-five (45) days may be required to kick off the project and align all resources. Trapeze will work to minimize this mobilization period through proactive planning with BBB.

If the length of the project exceeds three (3) months from the kick-off meeting, either due to BBB readiness or resourcing delays, a change order may be required to fund the extension.

Project Management
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 183 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed l Page 8 Trapeze will provide remote project management support for the entire duration of the project. The Trapeze project manager will be responsible for the successful planning, design, and execution of the project, including effective stakeholder communication, risk mitigation and meeting project milestones. The project manager will be the key point of contact for BBB for the duration of the project. Trapeze will also require BBB assign a project manager for this implementation. The two project managers will work together to ensure consistent dialogue is maintained through well-established communication channels.

A successful implementation requires effective and timely communication with all project stakeholders. Trapeze expects the project managers will meet on a bi-weekly basis.

In addition to the responsibilities outlined above, Trapeze project managers will also provide the following key services:

Change Management: If any deliverable(s) will need to be changed mid-project, the project manager will identify the impact of the change and initiate necessary actions to ensure timelines and project costs will be adjusted.

Milestone Sign-Offs: With each completed milestone, BBB will be asked to sign off on the milestone and confirm agreement with project moving forward.

BBB
Outlined below are estimated resource allocations to support the implementation and effort defined in this statement of work.

Resource Resource Allocation Responsibilities
Project Manager
30% of their time for
the full duration of the
project
Coordinate all resources from BBB and Clever
Coordinate conference calls and meetings, as required
Coordinate completion of Acceptance Testing
Coordinate BBB activities
Work with the Trapeze project manager to identify
risks, issues, and mitigations throughout the project
Subject Matter
Experts
20% of their time for
the full duration of the
project
100% during Training
Participate in the completion of the Project Design
activities, as well as BBB activities
Participate in the review of all documentation
Assist project manager with completion of Acceptance
Testing
Assist with Software deployment activities
Attend Training Sessions
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 184 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed l Page 9 System
Administrators / IT
25% of their time
during Software
Installation, Testing,
and Deployment
Assist with troubleshooting network or technical issues Provide access to servers as necessary throughout the
project
Maintain system security controls & permissions, user
accounts, etc.

Assist with Software deployment activities
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 185 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Budget l Page 10 Project Budget
The following project budget includes all licenses and services required for this implementation as outlined in this statement of work.

Item Description Cost (USD)
1 Licenses $77,271
2 Implementation Services $39,173
Management Discount $(7,438)
Total Cost $109,546
Long Term Support
Item Description Cost (USD)
1 90-day Warranty Included
2 Year 1 Maintenance $15,454
Long Term Support Notes:

All subsequent maintenance renewal fees will be based on the operational characteristics of BBB at the -current pricing
The 90-day Software warranty begins upon its installation in BBB environment Payment Milestones
The below payment milestones shall be followed throughout the implementation.

Milestone Description Acceptance Criteria % of Contract Value 1 Project Kickoff Meeting Agenda and Minutes 50% of Software Licenses 5% of Services
2 Project Design Delivery of preliminary Project Design Document
15% of Services
3 Software Installation Installation of the Software in BBB test environment
25% of Services
50% of Software Licenses
4 Training Completion of Training 20% of Services
5 Acceptance TestingRound 1 Completion of Round 1 of
Acceptance Testing
20% of Services
6 Acceptance Testing -
Final
Resolution of critical and major
defects
15% of Services
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 186 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Assumptions l Page 11 Project Assumptions
General Pricing Assumptions

1. This implementation is a fixed fee engagement.

2. Pricing does not include any applicable taxes or expenses associated with BBB or Clever and any of their resources assigned to the project.

3. Prior to sharing any proprietary information with 3rd party providers, a Non-Disclosure Agreement will need to be executed with Trapeze.

4. This project is expected to be complete within no more than three (3) months from the initial project kick-off meeting.

If the length of the project will exceed the proposed timeline due to BBB delays, a Project Change Order (CO) will need to be issued and agreed upon by both parties to accommodate any additional support services required to support the increased project duration.

5. Trapeze has included services to implement TSDE and export the data from FX through TSDE. It is expected that Clever will be responsible for importing the data and making it available for any Clever project related activities.

6. -the- bed in the most
current literature.

7. All Software will take advantage of the existing Trapeze infrastructure, data sources and software unless otherwise stated.

8. Clever/BBB are responsible for the purchase and installation of any required server hardware and

9. A BBB system administrator will be readily available for all configuration, installation, testing and deployment activities.

10. It is the responsibility of Clever/BBB to interface with TSDE data elements.

11. Licenses are based on the following operational characteristics:

Up to 195 peak vehicles

12. All services will be performed utilizing BBB he FX Software. However BBB is encouraged to upgrade to the latest version of FX.

13. Any integration with third party software or systems will be the responsibility of Clever/BBB.

14. Any services or requests not identified within this statement of work, including reviewing, or correcting data integrity issues, will be considered outside the scope of this engagement and will need to be addressed through a change order. Additional costs may apply based on the nature of the change.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 187 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Assumptions l Page 12

15. If Clever/BBB determines a need for additional support from Trapeze to review and correct any data integrity issues or training, these services will need to be addressed through the Trapeze change order process.
a. Clever/BBB is responsible for correcting all FX data issues as raised by downstream consumers of the TSDE data.

16. All services will be performed remotely.

17. Pricing is valid until September 15th, 2021.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 188 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit 5 Exhibit B-5
Scope of Services, Trapeze OPS-MON
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 189 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Introduction l Page 1 Introduction
The purpose of this document is to provide Big Blue Bus ( BBB ), with a quote and scope of work for the deployment of OPS-MON. By implementing the OPS-MON, BBB will be able to pass data from Trapeze OPS to the downstream 3rd party consumers specifically the CAD/AVL System from Clever. This document outlines the implementation services to be provided by Trapeze, as well as the support required from BBB and Clever staff and resources.

OPS-MON provides three one-way (outbound) tables containing the following real-time information:

Employee master file information
Vehicle master file information
Vehicle/work/assignment information
In addition, Trapeze will be customizing the OPS-MON module to include the following for BBB:

Implementation of the operational events import to import incidents from a 3rd party CAD/AVL system.

A new custom import to import real-time pull-in/out time from a CAD/AVL system This document will outline the services needed to implement the Software and the efforts required from Trapeze, BBB and Clever.

Trapeze Professional Services
Personnel
To ensure successful completion of this implementation, Trapeze will utilize the following professional services personnel:

Project Manager: The centralized point of contact for the project. The project manager is responsible for coordinating project schedules, deliverables and resources required to deliver the deliver the Trapeze solution as defined in this statement of work.

Technical Product Specialist(s): The primary technical point(s) of contact supporting the design, installation, configuration, testing, implementation, training, and deployment of the Trapeze solution.

Implementation Methodology Overview
This project will be executed in a phased approach, with key activities identified below:

1. Project Kick-Off

2. Project Design

3. Software Configuration
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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4. Software Development

5. Internal Acceptance Testing

6. Software Installation

7. Installation Testing

8. Training

9. Acceptance Testing

10. Deployment and Closure
Project Implementation Approach
Project Kick-Off
Following contract execution, Trapeze, BBB and Clever will hold a remote project kick-off meeting to align stakeholders on project scope and timelines, as well as review roles, responsibilities, key risks, and preliminary project schedule. Project teams from Trapeze, BBB and Clever (as required) are expected to attend the kick-off meeting.

Project Design
The Project Design meetings for OPS-MON will be held remotely over the course of up to one (1) day. In preparation for these discussions, BBB/Clever will be expected to provide Trapeze with any relevant operational materials and/or documentation requested.

The following topics will be covered during these meetings and calls:

BBB business needs
Current operational environment (policies/procedures) as they relate to CAD/AVL System Software configuration
OPS-MON and Clever Integration
Project timelines
Testing, training, and transition strategies
A preliminary Project Design Document outlining deliverables, goals and objectives, configurations, and expected project timelines for the implementation will be prepared by Trapeze and shared with BBB/Clever after the initial Project Design meetings. During the review process, non-standard Software functionality may be identified beyond any in-scope customizations. If desired, Trapeze will provide estimates to address these gap items, however addressing any such gaps will be considered out-of-scope and may result in additional costs.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 191 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Implementation Approach l Page 3 Following completion of the preliminary Project Design Document, Trapeze will provide BBB/Clever with the document to review and provide comments. BBB/Clever will have five (5) business days to complete this review, after which the Trapeze project manager will coordinate a meeting with BBB/Clever comments. Following this meeting, Trapeze will revise the Project Design Document to address BBB/Clever comments and feedback and will provide a finalized Project Design Document.

Software Configuration
Trapeze will configure the OPS-MON rules based on the standard functionality of the product. The version of OPSMON implemented during this project will align with BBB settings will be determined during the Project Design activities and documented appropriately. These configurations will then be utilized for Internal Acceptance Testing.

Software Development
Trapeze will provide custom development services that are required for adding the following scope:

Implementation of the operational events import that would enable import of incidents from a thirdparty CAD/AVL system.

A new custom import to import real-time pull-in/pull-out time from the CAD/AVL system with the following details:
o Creation of a new service with two (2) methods
UpdatePullInTime and UpdatePullOutTime.

Expected parameters for it will be: EventTime, Date, and VehicleNumber. OPS will then find the appropriate block based on EventTime and VehicleNumber and will adjust the ActualFromTime and ActualToTime as specified.

When changing the ActualFromTime and ActualToTime, OPS Will log these events in a new table (OPSPullInOutTimeLog: DailyBlockId, TransactionDate, TransactionTime, OriginalFromTime, OriginalToTime, NewFromTime, NewToTime).

There will not be a view for this log table in OPS, however, it is possible to query the database when needed for trouble shooting.

Trapeze will add detailed tracing activities in the new service methods for the purpose of integration trouble shooting. Further, a security key will also be added for the service.

Internal Acceptance Testing
Internal Acceptance Testing (IAT) is completed by Trapeze before any Software is installed in BBB environment. During IAT, Trapeze testing specialists will perform unit and regression testing to ensure completeness and accuracy of all standard features. These specialists will also update any automated regression test scripts to expand coverage as needed.

After unit and regression testing is completed, Trapeze Technical Product Specialists will run a series of tests in a local testing environment to ensure that all Software is functioning properly against BBB DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Packet Pg. 192 Attachment: Trapeze OPS-FXBBB CSA 5th Modification (5548 : Authorize 6th Modification to Contract #8928 with Trapeze, Inc. for Transit www.trapezegroup.com Confidential Not to be Disclosed Project Implementation Approach l Page 4 This allows Trapeze to proactively determine any potential data-related issues and ensures that all standard setup and configuration tasks can be performed for BBB, as well as validates that all branded Software is functioning as expected.

Clever is expected to provide support, including tools, data, and p environment. Activities completed as part of this test may include simulating data exchange as will be performed Software Installation
Following the completion IAT, Trapeze will work with Clever and BBB to remotely install and configure the Software in BBB test environment. The installation into test environment will be used to carry out the testing and training activities. BBB will be required to complete all hardware installations (including all server configurations) in time for the installation. To assist Trapeze with the installation, BBB will provide remote access (VPN, etc.) to all necessary servers. If remote access is unavailable, Zoom will be used as an alternate method for connecting to the servers. Clever will provide support to assist in connecting the Trapeze software to the Clever system.

Installation Testing
Installation Testing will occur after the new Software has been installed in BBB test environment. This testing is designed to ensure the Software is functioning properly within BBB as well as with third party software, as necessary. Installation Testing will also ensure successful demonstration of all requirements as documented in the Project Design Document.

During Installation Testing, BBB will grant Trapeze access to their servers so that Trapeze can perform testing of key Software functionality and validate the Software is functioning properly in BBB Installation Testing, Trapeze will validate the following:

Applications are connected to the appropriate database(s) General Software functionality is working as designed
All configurations and settings are functioning as agreed upon in the Project Design Document Clever will support this testing, ensuring that the Clever piece of this integration is working as described in the project design document.

Upon completion of Installation Testing, Trapeze will work with BBB to schedule training.

Training
Training Requirements
In order to facilitate remote training, BBB is responsible for setting up a dedicated classroom environment and include the following training equipment:

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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LCD projector
If the above-listed items are not available, Trapeze will work with BBB to identify alternative arrangements. In addition to training Trapeze will provide one (1) digital copy of all available user manuals. If desired, BBB can create additional hard copies for their users.

Training Delivery
Trapeze OPS-MON system administrator training will be based on standard training agendas and sessions vary in length based on topic. Trapeze will provide one (1) resource to assist BBB with the training session, which will be conducted remotely via Zoom Meeting. A detailed training agenda will be provided by Trapeze prior to the start of training. Training sessions cannot exceed eight (8) employees per session.

The following table outlines the proposed training for this implementation:

Module Training Topic Duration (Days) On-site/Remote
OPS-MON Subject Matter Expert Training 0.5 Remote
Acceptance Testing
Acceptance Testing involves BBB utilizing the new Trapeze Software in the test environment to ensure it responds accurately to user inputs and all features and functions work as specified in the Project Design Document.

Trapeze will provide a resource for up to two (2) days to remotely begin the Acceptance Testing activities.

Following the remote support, BBB will have ten (10) business days in which to perform an initial comprehensive end-to-end round of Acceptance Testing.

All subsequent end-to-end rounds of Acceptance Testing must be completed in no more than five (5) business days.

Testing Defect Review Tracking and Resolution
During Acceptance Testing, BBB and Clever will document and prioritize any defects encountered throughout the testing period (if any exist). Following the completion of a round of testing, BBB and Clever will supply Trapeze with a complete list of all perceived defects, which Trapeze will assess for root cause and resolve where appropriate based on the severity levels defined below.

1. Critical Defect causes failure of critical functionality or critical data and no workaround is available. o This can include but is not limited to:

System crashing
Non-recoverable conditions
Data loss or corruption
Security concerns leading to breach of information and/or misuse, or severely affecting system performance and/or functionality.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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2. Major Defect partially impairs critical functionality. A workaround is available but difficult to execute. o This can include but is not limited to:

System crashing or aborting during normal operation of a non-critical flow.

Missing functionality
Inconsistent logic or display of data.

Slow responsiveness and underperformance of the system
Missing security or system patches, minor breach of information

3. Minor Defect impairs non-critical functionality with a satisfactory workaround available. o This can include but is not limited to:

Minor usability issues such as inconsistent display
Tab/shortcut keys not working.

Missing input validation
System recoverable errors
BBB will identify the priority of each defect and indicate the desired resolution sequence (1 = soonest resolution desired). Trapeze will make every effort to resolve defects of the same severity levels based on sequential order.

At the completion of each round of testing, Trapeze will work remotely to resolve all critical and major defects (if any exist). If an updated Software solution is required to resolve the defect(s), Trapeze will provide the updated Software encompassing all defect fixes. BBB and Clever will be asked to test and validate the Software to ensure all defects have been rectified. If further defects are identified, Trapeze will evaluate and work to resolve them, and BBB will be asked to execute another round of Acceptance Testing.

Once BBB confirms that all critical and major defects have been resolved, Acceptance Testing will be considered complete and the Software deemed ready for production use. BBB will be required to sign off on the Acceptance Testing. All minor defects will be transitioned to the Trapeze maintenance and support program, who will provide new Software builds addressing post-deployment defects, as necessary.

Deployment and Closure
production environment so that it can be used to support live operations.

BBB and Clever SMEs are expected to be the first level support for end users during the deployment activities.

SMEs will be expected to provide support on the use of the new system, answer questions regarding functions that may be unfamiliar, and reinforce key functionalities.

Deployment Support
Trapeze will provide remote go-live support for the launch of the new Software over the course of one (1) week.

BBB can leverage these services during standard business hours to address any non-critical questions or support needs that may arise from using the Software to support live operations.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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At the completion of the one (1) week deployment support period, all ongoing support will continue to be provided -term maintenance program. At this time, the project will be considered complete and project closure will be processed.

Responsibilities and Deliverables
Activity
Trapeze
Responsibilities
BBB/Clever Responsibilities Deliverables
Project Kick-Off
Lead project kick-off
meeting
Develop and
maintain project
schedule
Provide input for Clever and
BBB-led activities
Provide database backup
Ensure all appropriate staff
attend the kick-off meeting
Assist with developing and
maintaining the project schedule
Kick-Off
meeting
Preliminary
project
schedule
(revised as
necessary)
Preliminary
Project Plan
Project Design Conduct Project
Design meetings
Participate in Project Design
meetings
Provide documentation as
requested
Review Project Design
Document and provide
comments/feedback
Sign off on finalized Project
Design Document
Finalized
Project Design
Document
Finalized
Project
Schedule
Software Configuration
Configure the
Software as
documented in the
Project Design
Document
Provide a back up of the
production MMS database
Configured
Software in the
test
environment
Software Development Complete custom
development Consult as necessary
Completed
custom
development
as per Section

3.4 Internal Acceptance
Testing
Perform Internal
Acceptance Testing
Provide data as necessary
Provide support as necessary
Software Installation
Install Software in
BBB
environment
Complete all hardware
installation(s)
Provide access to test
environment
Manage servers, databases,
backup procedures, database
maintenance practices, and
Windows environments and
security
Install Trapeze pre-requisite
Software (e.g. ODBC
Installed
Software in
BBB
environment
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Trapeze
Responsibilities
BBB/Clever Responsibilities Deliverables
connections, database servers,
etc.)
Installation Testing Perform Installation
Testing
Provide technical consulting and
testing support as required
Provide access to test
environment
Training
Review training
topics with BBB
Conduct training
sessions
Ensure trainees are prepared
and engaged in all training
activities
Training
agenda
Completed
training
sessions
Available user
manuals
Acceptance Testing Support BBB during
Acceptance Testing
Perform Acceptance Testing
Complete prioritization of
defect(s)
Re-test defect resolutions
Escalate defects to the
appropriate Trapeze resource
Prioritized
defects log
Software
releases, as
necessary
Deployment and Closure
Migrate Software to
BBB
environment
Provide remote
support for one (1)
week for Software
rollout
Escalate defects to appropriate
Trapeze Technical Product
Specialists
Update production system to
ensure all records are up to date
Ensure data accuracy
Confirm connectivity, logins, etc.

Trapeze
Software is
operational and
functional in
BBB
production
environment
Project Duration
This implementation is expected to be completed within three (3) months from the completion of the project kick-off meeting. Following contract execution, a mobilization period of up to forty-five (45) days may be required to kick off the project and align all resources. Trapeze will work to minimize this mobilization period through proactive planning with BBB.

If the length of the project exceeds three (3) months from the kick-off meeting, either due to BBB readiness or resourcing delays, a change order may be required to fund the extension.

Project Management
Trapeze will provide remote project management support for the entire duration of the project. The Trapeze project manager will be responsible for the successful planning, design, and execution of the project, including effective stakeholder communication, risk mitigation and meeting project milestones. The project manager will be the key point of contact for BBB and Clever for the duration of the project. Trapeze will also require BBB and Clever assign a project manager for this implementation. The three project managers will work together to ensure consistent dialogue is maintained through well-established communication channels.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

5.D.h
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In addition to the responsibilities outlined above, Trapeze project managers will also provide the following key services:

Change Management: If any deliverable(s) will need to be changed mid-project, the project manager will identify the impact of the change and initiate necessary actions to ensure timelines and project costs will be adjusted.

Milestone Sign-Offs: With each completed milestone, Clever/BBB will be asked to sign off on the milestone and confirm agreement with project moving forward.

Clever/BBB
Outlined below are estimated resource allocations to support the implementation and effort defined in this statement of work.

Resource Resource Allocation Responsibilities
Project Manager
30% of their time for
the full duration of the
project
Coordinate all resources from BBB and Clever
Coordinate conference calls and meetings, as required
Coordinate completion of Acceptance Testing
Coordinate BBB and Clever activities
Work with the Trapeze project manager to identify
risks, issues, and mitigations throughout the project
Subject Matter
Experts
(BBB and Clever)
20% of their time for
the full duration of the
project
100% during SME
Training
Participate in the completion of the Project Design
activities, as well as BBB and Clever activities
Participate in the review of all documentation
BBB SMEs to participate in the SME training
Assist project manager with completion of Acceptance
Testing
Assist with Software deployment activities
System
Administrators / IT
25% of their time
during Software
Installation, Testing,
and Deployment
Assist with troubleshooting network or technical issues Provide access to servers as necessary throughout the
project
Maintain system security controls & permissions, user
accounts, etc.

Assist with Software deployment activities
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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The following project budget includes all licenses and services required for this implementation as outlined in this statement of work.

Item Description Cost (USD)
1 Licenses $61,537
2 Implementation Services $53,450
Management Discount ($26,005)
Total Cost $88,982
Long Term Support
Item Description Cost (USD)
1 90-day Warranty Included
2 Year 1 Maintenance $12,307
Long Term Support Notes:

All subsequent maintenance renewal fees will be based on the operational characteristics of BBB at the -current pricing
The 90-day Software warranty begins upon its installation in BBB environment Payment Milestones
The below payment milestones shall be followed throughout the implementation.

Milestone Description Acceptance Criteria % of Contract Value 1 Project Kick Off Completion of Project Kick off
meeting
50% of Software Licenses
2 Project Design Delivery of preliminary Project Design Document
25% of Services
3 Software Installation Installation of the Software in BBB test environment
50% of Licenses
25% of Services
4 Training Completion of SME training 25% of Services
5 Acceptance TestingRound 1 Completion of Round 1 of
Acceptance Testing
15% of Services
6 Acceptance Testing -
Final
Resolution of critical and major
defects
10% of Services
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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General Pricing Assumptions

1. This implementation is a fixed fee engagement.

2. Prices for this fixed fee engagement will be honoured if BBB completes sign off on this agreement by no later than September 30, 2021. Should BBB choose not to execute contract signing by this date, Trapeze will no longer honour the services pricing listed in this scope of work.

3. Pricing does not include any applicable taxes or expenses associated with BBB/Clever and any of their resources assigned to the project.

4. Prior to sharing any proprietary information with 3rd party providers, a Non-Disclosure Agreement will need to be executed with Trapeze.

5. This project is expected to be complete within no more than three (3) months from the initial project kick-off meeting.

If the length of the project will exceed the proposed timeline due to BBB delays, a Change Order will need to be issued and agreed upon by both parties to accommodate any additional support services required to support the increased project duration.

6. The S -thecurrent literature.

7. The standard, out-of-box Software and solution delivery approach will be provided as described in the most current Software literature

8. All Software will take advantage of the existing Trapeze infrastructure, data sources and software unless otherwise stated.

9. Clever/BBB are responsible for the purchase and installation of any required server hardware and

10. A BBB system administrator will be readily available for all configuration, installation, testing and deployment activities.

11. Licenses are based on the following operational characteristics:

Up to 317 OPS processed employees

12. Any integration with third party software or systems will be the responsibility of Clever/BBB.

13. Any services or requests not identified within this statement of work, including reviewing, or correcting data integrity issues, will be considered outside the scope of this engagement and will need to be addressed through a change order. Additional costs may apply based on the nature of the change.

14. If Clever/BBB determines a need for additional support from Trapeze to review and correct any data integrity issues or training, these services will need to be addressed through the Trapeze change order process.
a. Clever/BBB are responsible for correcting all OPS data issues as raised by downstream consumers of the data.

15. All services will be performed remotely.

16. Pricing is valid until September 15th, 2021.

DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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Budget
New Licensed Products and Additional Services shall not exceed $255,180:

1. Trapeze Standard Data Exchange (TSDE) Software Licenses and Services

2. Trapeze OPS-MON Software Licenses and Services
DocuSign Envelope ID: 28D2EB71-A21D-4980-9E4D-8F578A5D2B74

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CITY OF SANTA MONICA

OAKS INITIATIVE NOTICE

NOTICE TO APPLICANTS, BIDDERS, PROPOSERS

AND OTHERS SEEKING DISCRETIONARY PERMITS, CONTRACTS,

OR OTHER BENEFITS FROM THE CITY OF SANTA MONICA
Santa Monica’s voters adopted a City Charter amendment commonly known as the Oaks Initiative. The Oaks Initiative requires the City to provide this notice and information about the Initiative’s requirements. You may obtain a full copy of the Initiative’s text from the City Clerk.

This information is required by City Charter Article XXII—Taxpayer Protection. It prohibits a public official from receiving, and a person or entity from conferring, specified personal benefits or campaign advantages from a person or entity after the official votes, or otherwise takes official action, to award a “public benefit” to that person or entity. The prohibition applies within and outside of the geographical boundaries of Santa Monica.

All persons or entities applying or receiving public benefits from the City of Santa Monica shall provide the names of trustees, directors, partners, and officers, and names of persons with more than a 10% equity, participation or revenue interest. An exception exists for persons serving in those capacities as volunteers, without compensation, for organizations exempt from income taxes under Section 501(c)(3), (4), or (6), of the Internal Revenue Code. However, this exception does not apply if the organization is a political committee or controls political committees. Examples of a “public benefit” include public contracts to provide goods or services worth more than $25,000 or a land use approval worth more than $25,000 over a 12-month period.

In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity. Therefore, if you are seeking a “public benefit” covered by the Oaks Initiative, you must supply that information on the Oaks Initiative Disclosure Form. This information must be updated and supplied every 12 months.

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CITY OF SANTA MONICA

OAKS INITIATIVE DISCLOSURE FORM
In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity.

Public benefits include:

1. Personal services contracts in excess of $25,000 over any 12-month period;

2. Sale of material, equipment or supplies to the City in excess of $25,000 over a 12- month period;

3. Purchase, sale or lease of real property to or from the City in excess of $25,000 over a 12- month period;

4. Non-competitive franchise awards with gross revenue of $50,000 or more in any 12-month period;

5. Land use variance, special use permit, or other exception to an established land use plan, where the decision has a value in excess of $25,000;

6. Tax “abatement, exception, or benefit” of a value in excess of $5,000 in any 12- month period; or

7. Payment of “cash or specie” of a net value to the recipient of $10,000 in any 12- month period.

Name(s) of persons or entities receiving public benefit:

Name(s) of trustees, directors, partners, and officers:

Name(s) of persons with more than a 10% equity, participation, or revenue interest:

Prepared by: ____________________________Title: __________________________ Signature: ______________________________________ Date: ________________ Email: ____________________________________ Phone: ____________________ FOR CITY USE ONLY:

Bid/PO/Contract # ____________________________ Permit # ___________________________

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Report
City Council Meeting: February 28, 2023
Agenda Item: 5.E
1 of 3
To: Mayor and City Council
From: David White, City Manager, City Manager's Office
Subject: Authorization to Accept a Donation from Kiwanis Charities of Santa Monica to Purchase and Install Scoreboards at Los Amigos Park and Historic Belmar Park
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding that the scoreboards are categorically exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15311 (Class 11 Accessory Structures) of the CEQA Guidelines;

2. Authorize the City Manager to accept a donation in the amount of $70,000 from Kiwanis Charities of Santa Monica for the purchase and installation of one scoreboard at Los Amigos Park and one scoreboard at Historic Belmar Park; and

3. Authorize budget changes as outlined in the Financial Impacts & Budget Actions section of this report.

Summary
The Kiwanis Club of Santa Monica and its associated foundation, Kiwanis Charities of Santa Monica, has offered the City a $70,000 donation to exclusively fund the fabrication and installation of two scoreboards to replace the one existing non-functional scoreboard at Los Amigos Park and add a new scoreboard at Historic Belmar Park.

Discussion
The Kiwanis Club of Santa Monica was established in 1922 and has an impressive record of supporting the community through acts of service, student scholarships, and other financial contributions, including a $50,000 donation to the City in 2015 that funded a new playground at Ozone Park. The current proposed donation of $70,000

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would fund fabrication and installation of one scoreboard at Los Amigos Park and one at Historic Belmar Park.

Los Amigos Park is a public park located on the Muir/SMASH campus and has been home to Santa Monica Pony Baseball since 1952, where the league hosts games, practices, and operates a snack bar. The existing scoreboard at the park has long exceeded its expected useful life and is no longer functional. It is estimated that fabrication and installation of the Los Amigos scoreboard would cost approximately $18,000 and could be installed in one year, including several months to obtain approval from the Division of the State Architect as required for projects on school district property.

Historic Belmar Park opened at the Civic Center in February 2021 and, due to budgetary constraints, a scoreboard was excluded from the original project plans. Now that the field has been in use for two years, the community has expressed a desire to add a scoreboard for field permitees to utilize. Installation of the scoreboard at Historic Belmar Park would require constructing a new electrical power source, resulting in an estimated total cost of $50,000 and a 14-month project timeline.

The City’s Community Partnerships team has coordinated the donation with the Kiwanis Club of Santa Monica, and Public Works’ Architecture Services Division would oversee fabrication and installation of the scoreboards. In accordance with the City’s Standard Donations Policy, Council authorization is required to accept direct donations to the City valued at more than $50,000.

Commission Action
The Recreation and Parks Commission met on January 26, 2023, reviewed the scoreboard designs, and discussed Kiwanis Charities of Santa Monica’s proposed $70,000 donation for the purchase and installation of the scoreboards. The Commission voted unanimously to recommend approval of the donation to Council. Further, the Field Sports Advisory Committee met on February 1, 2023 and also were supportive of Council accepting the donation.

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Environmental Review
The scoreboards are categorically exempt from CEQA pursuant to Section 15311 Accessory Structures (Class 11) of the CEQA Guidelines. Class 11 consists of the construction, or replacement, of minor structures accessory to existing commercial, industrial, or industrial facilities, including but not limited to on-premise signs, parking lots, seasonal or temporary use items. The scoreboards are accessory structures and therefore, are categorically exempt as set forth in Section 15311 of the CEQA Guidelines.

Financial Impacts and Budget Actions
Staff seeks authority to accept a donation from Kiwanis Charities of Santa Monica and appropriate funds in the City’s Capital Improvement Program budget for the fabrication and installation of two new scoreboards.

FY 2022-23 Budget Changes
Establish Revenue Budget Appropriate Funds
Account Number Amount Account Number Amount
10200002.416270 $70,000 C1008750.689000 $70,000
Total $70,000 Total $70,000
Prepared By: Melissa Spagnuolo, Community Partnerships Manager Approved Forwarded to Council

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City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 5.F
1 of 4
To: Mayor and City Council
From: David Martin, Director, City Planning
Subject: Adoption of Resolutions Authorizing the City Manager to Submit Applications to Participate in the California Department of Housing and Community Development's Prohousing Designation Program and a Prohousing Incencentive Program (PIP) Grant in the Amount of $500,000 Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines and find that uses of grant funding for affordable housing are consistent with the certified 6th Cycle Housing Element Environmental Impact Report.

2. Adopt the attached resolution authorizing the City Manager to submit an application to participate in the California Department of Housing and Community Development’s Prohousing Designation Program;

3. Adopt the attached resolution authorizing the City manager to submit an application for grant funds in the amount of $500,000 from the California Department of Housing and Community Development’s Prohousing Incentive Program (PIP) for planning and implementation activities related to housing and community development, to support implementation of the certified Housing Element;

4. Authorize the City Manager to execute all necessary documents to apply for the grant, accept the grant, if awarded, and accept all grant renewals and modifications, if awarded; and

5. Authorize budget changes as outlined in the Financial Impacts and Budget Actions section of this report, in the event the grant is awarded.

Summary
Staff seeks authorization to apply for and participate in the State of California’s Housing and Community Development (HCD) Prohousing Designation Program and to apply for grant funding through HCD’s Prohousing Incentive Pilot (PIP) Program. The Prohousing

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Designation program creates incentives for jurisdictions that are compliant with Housing Element requirements and that have enacted Prohousing Policies. These incentives include additional points or other preference in the scoring of applications for competitive housing and infrastructure programs.

Discussion
On October 14, 2022, HCD certified the City’s 6th Cycle 2021-2029 Housing Element. A key focus of the certified Housing Element is housing production, with substantial emphasis on affordable housing production, to meet Santa Monica’s Regional Housing Needs Allocation (RHNA) as mandated by Government Code Section 65584.05.

The City’s 6th Cycle RHNA for the next 8 years is 8,895 units, of which 69% are to be affordable units.

Income
Category
RHNA Target
(# units)
% of
RHNA
Very Low 2,794 31%
Low 1,672 19%
Moderate 1,702 19%
Above Moderate 2,727 31%
Total 8,895 100%
The certified 6th Cycle Housing Element is a State-mandated plan for meeting the City’s share of regional housing needs. State law requires that the Housing Element include an inventory of land that demonstrates the City’s capacity to realistically accommodate its RHNA of 8,895 units, of which 69% must be affordable to lower income households.

Government Code section 65589.9 established HCD’s Prohousing Designation Program, which provides incentives to cities and counties in the form of additional points or other preference in the scoring of competitive housing, community development, and infrastructure programs. The Prohousing Incentive Pilot (PIP) Program is a state investment from the Building Homes and Jobs Trust Fund, established by Chapter 364, Statutes of 2017 (SB 2, Atkins) to create and conserve affordable housing. The PIP program provides awards for eligible jurisdictions to use towards planning and implementation activities related to housing and community development. Award

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amounts are based on population estimates. With a population of approximately 93,000, the City is eligible for $500,000 in award funding.

The PIP program awards funds to encourage cities and counties to obtain Prohousing Designation. This round of program funding provides awards for eligible jurisdictions to use towards planning and implementation activities related to housing and community development. To support implementation of the certified Housing Element, grant funds would be used in the category of predevelopment, development, acquisition, rehabilitation, and preservation of 100% affordable housing on City-owned sites.

With a limited amount of vacant land in Santa Monica, and amid rising construction costs, the City in recent years has explored the potential for City-owned sites to help meet its affordable housing needs. Program 2.E of the certified Housing Element commits City-owned sites for the production of 100% affordable housing, with consideration of other community-serving purposes, including, but not limited, to green space, place making, and/ or community-serving commercial and revenue generating uses. Under Program 2.E, the City has committed to plan for a minimum of 1,880 affordable housing units across available City-owned sites located throughout the city.

Application of this one-time PIP program grant would occur concurrently with application of the Prohousing Designation program for the City. Grant funding would be used towards predevelopment, development, acquisition, rehabilitation, and preservation of 100% affordable housing on City-owned sites, in support of the Program 2.E and other related programs in the Housing Element.

Environmental Review
Application to and participation in the Prohousing Designation Program, and application and acceptance of the Prohousing Implementation Program grant is exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) (Common Sense Exemption) in that participation in the programs and acceptance the grant would have no possibility of significant effects. Furthermore, the proposed uses of grant funding for affordable housing are consistent with the goals, programs and policies set

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forth in the adopted and certified 6th Cycle Housing Element EIR, including Program

2.E which commits the City to the production of affordable housing on publicly owned land.

Past Council Actions
Meeting Date Description
10/14/22 City Council adopts the 6th Cycle 2021-2029 Housing Element
Financial Impacts and Budget Actions
Staff seeks authority to apply for a grant from the Department of Housing and Community Development’s Prohousing Incentive Program (PIP). If awarded, staff recommends the following budget changes. If renewals are awarded, budget changes will be included in subsequent year budgets, contingent on Council budget approval.

FY 2022-23 Grant Budget Changes
Establish Revenue Budget Appropriate Funds
Account Number(s) Amount Account Number(s) Amount
20700002.4XXXXX 500,000 20700002.5XXXXX 500,000
Total 500,000 Total 500,000
Prepared By: Rachel Kwok, Environmental Planner
Approved Forwarded to Council
Attachments:

A. Council Resolution Prohousing Designation
B. CCD - Reso - Application for Prohousing Incentive Pilot - 021423

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1 City Council Meeting: February 28, 2023 Santa Monica, California RESOLUTION NUMBER _________ (CCS)
(City Council Series)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA

AUTHORIZING THE CITY MANAGER TO SUBMIT AN APPLICATION FOR AND

PARTICIPATION IN THE CALIFORNIA DEPARTMENT OF HOUSING AND

COMMUNITY DEVELOPMENT PROHOUSING DESIGNATION PROGRAM
WHEREAS, Government Code section 65589.9 established the Prohousing Designation Program (“PDP” or “Program”), which creates incentives for jurisdictions that are compliant with state housing element requirements and that have enacted Prohousing local policies; and
WHEREAS, such jurisdictions will be designated Prohousing, and, as such, will receive additional points or other preference during the scoring of their competitive applications for specified housing and infrastructure funding; and WHEREAS, the Department of Housing and Community Development (“Department”) has adopted emergency regulations (Cal. Code Regs., tit. 25, § 6600 et seq.) to implement the Program (“Program Regulations”), as authorized by Government Code section 65589.9, subdivision (d); and
WHEREAS, the City of Santa Monica (“Applicant”) desires to submit an application for a Prohousing Designation (“Application”).

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Packet Pg. 211 Attachment: Council Resolution Prohousing Designation [Revision 5] (5588 : Apply for Prohousing Incencentive Program grant for $500,000) 2 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS:

SECTION 1. The City Manager, or designee, is hereby authorized and directed to submit an Application to the Department.

SECTION 2. The City acknowledges and confirms that it is currently in compliance with applicable state housing law.

SECTION 3. The City acknowledges and confirms that it will continue to comply with applicable housing laws and to refrain from enacting laws, developing policies, or taking other local governmental actions that may or do inhibit or constrain housing production. Examples of such local laws, policies, and action include moratoriums on development; local voter approval requirements related to housing production; downzoning; and unduly restrictive or onerous zoning regulations, development standards, or permit procedures.

SECTION 4. The City further acknowledges and confirms that it commits itself to affirmatively furthering fair housing pursuant to Government Code section 8899.50.

SECTION 5. If the Application is approved, the City Manager is hereby authorized and directed to enter into, execute, and deliver all documents required or deemed necessary or appropriate to participate in the Program, and all amendments thereto (the “Program Documents”).

SECTION 6. The City acknowledges and agrees that it shall be subject to the Application; the terms and conditions specified in the Program Documents; the Program Regulations; and any and all other applicable law.

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Packet Pg. 212 Attachment: Council Resolution Prohousing Designation [Revision 5] (5588 : Apply for Prohousing Incencentive Program grant for $500,000) 3 SECTION 7. The City Manager is authorized to execute and deliver the Application and the Program Documents on behalf of the Applicant for participation in the Program
SECTION 8. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect.

APPROVED AS TO FORM:
_________________________

DOUGLAS SLOAN
City Attorney

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Packet Pg. 213 Attachment: Council Resolution Prohousing Designation [Revision 5] (5588 : Apply for Prohousing Incencentive Program grant for $500,000) 1 City Council Meeting: February 28, 2023 Santa Monica, California RESOLUTION NUMBER _________ (CCS)
(City Council Series)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA

AUTHORIZING THE CITY MANAGER TO SUBMIT AN APPLICATION FOR AND

ACCEPT RECEIPT OF PROHOUSING INCENTIVE PILOT PROGRAM FUNDS WHEREAS, pursuant to Health and Safety Code 50470 et seq., the California Department of Housing and Community Development (“Department”) is authorized to issue Guidelines as part of an incentive program (hereinafter referred to by the Department as the Prohousing Incentive Pilot Program or “PIP”); and WHEREAS, the City Council of the City of Santa Monica desires to submit a PIP grant application package (“Application”), on the forms provided by the Department, for approval of grant funding for eligible activities toward planning and implementation activities related to housing and community development as a result of meeting eligibility criteria, including, but not limited to, Prohousing Designation; and WHEREAS, the Department has issued Guidelines and Application on December 15, 2022, in the amount of Twenty-Five Million, Seven Hundred Five Thousand, Five Hundred Forty-Five Dollars and Sixty-Five Cents ($25,705,545.65) for PIP.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS:

SECTION 1. The City Manager, or designee, is hereby authorized and directed to submit an Application to the Department in response to the Notice of Funding Availability, and to apply for the PIP grant funds in a total amount not to exceed $500,000.

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Packet Pg. 214 Attachment: CCD - Reso - Application for Prohousing Incentive Pilot - 021423 [Revision 2] (5588 : Apply for Prohousing Incencentive Program 2 SECTION 2. In connection with the PIP grant, if the Application is approved by the Department, the City Manager of the City of Santa Monica, or designee, is authorized and directed to enter into, execute, and deliver on behalf of the City, as the Applicant, a State of California Agreement (“Standard Agreement”) for the amount of Five Hundred Thousand Dollars ($500,000), and any and all other documents required or deemed necessary or appropriate to evidence and secure the PIP grant, the City’s obligations related thereto, and all amendments thereto.

SECTION 3. The City, as the Applicant, shall be subject to the terms and conditions as specified in the Guidelines, and the Standard Agreement provided by the Department after approval. The Application and any and all accompanying documents are incorporated in full as part of the Standard Agreement. Any and all activities funded, information provided, and timelines represented in the Application will be enforceable through the fully executed Standard Agreement. Pursuant to the Guidelines and in conjunction with the terms of the Standard Agreement, the City hereby agrees to use the funds for eligible uses and allowable expenditures in the manner presented and specifically identified in the approved Application.

SECTION 4. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect.

APPROVED AS TO FORM:
_________________________

DOUGLAS SLOAN
City Attorney

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Packet Pg. 215 Attachment: CCD - Reso - Application for Prohousing Incentive Pilot - 021423 [Revision 2] (5588 : Apply for Prohousing Incencentive Program City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 5.G
1 of 6
To: Mayor and City Council
From: Douglas Sloan, City Attorney, City Attorney's Office, Administration Subject: Adoption of Salary Resolution for New and Existing Job Classifications and Approval of Position Changes
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no project and/or categorical exemption pursuant to Section 15324 (Class 24 Regulations of Working Conditions) of the California Environmental Quality Act (CEQA) Guidelines; and

2. Adopt a resolution establishing a new classification and salary rate for the new classification of Executive Administrative Assistant-CAO (Attachment A); and

3. Approve the cost neutral budget and position changes described in the Financial Impacts and Budget Action section of this report.

Summary
This report presents proposed staffing adjustments within the City Attorney’s Office (CAO) that do not impact the General Fund. The proposed staffing adjustments address ongoing operational changes and align existing duties with appropriate classifications.

The report also includes a salary resolution establishing a new classification for Executive Administrative Assistant-CAO and its applicable salary rate.

Discussion
The priorities reflected in this proposal are to save the City money and to retain valuable employees in the CAO, especially staff who provide support for the attorneys. This report also proposes adding one attorney who will be dedicated to Big Blue Bus (BBB) liability claims, funded by the BBB Fund.

This is being brought at this time for several reasons. The City, as well as many other jurisdictions and industries, are experiencing unprecedented employee movement - the

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“Great Resignation.” Employees in the CAO have been pushing themselves hard to maintain services at pre-COVID levels, but with reduced resources and numbers of employees. There are morale issues that are long overdue in being addressed, and additional delay can only make it worse. Employees have been working beyond their current job duties, and the proposed changes are designed to at least allow them to be compensated appropriately, and lessen the chances that they will leave the City for alternate employment. Employee retention is essential to allow the office to fulfill its Charter obligations and serve the community.

The proposed staffing changes involve only reassigning employees to other existing classifications, not creating new classifications. This streamlines, simplifies, and shortens the process.

The proposed add/deletes do not impact the General Fund; rather, they are funded by utilizing the Consumer Rights Fund and refocusing some employees to Consumer Rights matters. At the projected draw down rate, there are adequate resources in the Consumer Rights Fund to fund the proposed staffing changes for at least seven years, even assuming no additional funds are collected, which would be highly unusual.

The lawyer funded by the BBB Fund would generate savings estimated at well over $200,000 per year, versus sending the work to outside counsel. BBB will no doubt incur at a minimum the equivalent of one FTE of a litigation attorney for the defense of their liability claims. At $300 per hour, sending out 1,800 hours of work would cost $540,000; salary and benefits of an in-house lawyer will total less than half of that.

In 2020, the City restructured its workforce to support essential City services and programs as a result of the COVID-19 pandemic. Since 2020, the CAO, like other City departments, has navigated the challenges of an increased workload with reduced resources. The CAO has bridged this gap in large part through the hard work and dedication of CAO staff, many of whom are performing higher-level duties beyond their current classification. In addition, although many CAO staff members routinely work overtime to keep up with the CAO’s increased workload, the volume of work exceeds existing capacity. Consequently, the CAO has had to rely more on outside law firms on

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projects and matters that could have been handled in-house in a far more cost-effective manner.

The CAO’s operations have responded to ongoing challenges. In response to the COVID-19 pandemic and the sudden need to establish a remote work environment, the CAO’s Criminal Unit transitioned to fully electronic operations in five days. To further the Council’s priority for a Clean and Safe Santa Monica, the CAO’s Criminal Unit filed nearly double the number of criminal cases compared to the prior year, 2,033 cases in 2022, compared to 1,080 cases in 2021, and that level of service is expected to continue. The CAO has leveraged cloud-based solutions to manage the higher volume in criminal filings. Supporting these technologies and the significant increase in criminal filings has resulted in CAO staff working overtime and performing higher-level tasks outside of their current classifications. Accordingly, the CAO proposes adding (converting) two Legal Assistant positions to better classify employees based on currently assigned legal duties, in other words, moving the affected employees to higher existing appropriate classifications.

Mindful of budgetary constraints, the CAO has used creative approaches to support its operations with existing resources. For example, the CAO provides legal advice and administrative support to every City department in facilitating the responses to all Public Records Act (PRA) requests within statutory deadlines. The current volume of PRArelated work is not sustainable with current resources. To help address the increasing number of PRA requests, the CAO has closed its reception desk from walk-in requests to the public so that additional CAO staff resources can be used to support PRA-related work for the entire City. In addition, the CAO proposes adding another full-time Administrative Analyst-CAO position, which would support PRA-related work, contract management, billing, and other administrative functions.

The CAO also has continued to experience an increase in the legal work needed to support the Department of Transportation’s (DOT) operations, including responding to pre-suit claims and defending the Big Blue Bus (BBB) in active litigation, which has required the retention of outside legal counsel to keep pace with the volume of legal work in this area. To meet this increased need for legal services in a more cost-efficient manner, the CAO proposes to hire an additional Deputy City Attorney that would be

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funded entirely by the BBB enterprise fund. Hiring an additional Deputy City Attorney would enable the City to decrease outside counsel fees by over $200,000 per year.

Attachment A is a salary resolution presenting for approval the new classification for Executive Administrative Assistant-CAO. Staffing adjustments to reflect ongoing operational changes are found in the Financial Impacts section, below. The actions presented in Attachment A are described below. The fiscal impact associated with these changes are cost neutral and will have no fiscal impact on the General Fund. Below are details about specific position changes and additional positions. • The proposed deletion of an open Staff Assistant-CAO position and the addition of an Administrative Analyst-CAO position reflects the department’s intent to appropriately classify the position based on the currently assigned duties. The employee would continue to support the City’s efforts to respond to PRA requests while also supporting contract management, billing, and other administrative functions across the CAO. Adding this position will bring the existing position to an appropriate compensation level to reflect the employee’s current duties. Additionally, performing these functions in-house and retaining an employee with institutional knowledge is more cost-effective than using an outside law firm or exposing the City to potential PRA liability. • The CAO is adding an additional Deputy City Attorney position to support the Department of Transportation’s (DOT) increased legal work. Hiring an additional Deputy City Attorney is more cost-effective than using outside counsel and will result in a net cost-savings to BBB’s enterprise fund.
• The CAO is reclassifying a long-term, dedicated employee working in a Receptionist position to a newly established Executive Administrative AssistantCAO position. This employee will continue to support CAO reception functions, including responding to in-person requests by appointment, and responding to telephonic and email inquiries from the public. In addition, this position will help support the City’s PRA-related work. Performing these functions in-house and retaining a long-term employee with institutional knowledge is more cost-effective than using an outside law firm.

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• The CAO is reclassifying a long-term, dedicated Staff Assistant-CAO to a newly established Executive Administrative Assistant-CAO position to better reflect the increased, higher-level legal duties this employee is performing, including supporting litigation-related work.
• The proposed deletion of two Legal Secretary II positions and the addition of two Legal Assistant positions reflect the CAO’s intent to appropriately classify the position based on the currently assigned duties. The CAO is promoting two longterm dedicated employees into these positions to reflect increased, higher-level legal duties. Performing these functions in-house and retaining employees with decades of experience and institutional knowledge is more cost-effective than having an outside law firm perform these functions.

Environmental Review
The staffing changes in this report are either not a project or categorically exempt pursuant to Section 15324 (Class 24 Regulations of Working Conditions) of the California Environmental Quality Act (CEQA) Guidelines. Class 24 consists of actions taken by regulatory agencies to regulate employee wages, hours of work, or working conditions where there will be no demonstrable physical changes outside the place of work.

Financial Impacts and Budget Actions
The prorated cost of the recommended changes for this fiscal year is approximately $105,724 or less, depending upon when the new BBB attorney could be recruited and onboarded. The changes would not have an impact on the General Fund, as they would be funded by the Big Blue Bus Fund ($69,427 – or less) and reserves from the Consumer Protection funds ($36,297). The annual ongoing cost is approximately $360,000, funded by the Big Blue Bus Fund ($230,000) and reserves from the Consumer Protection funds ($130,000). The ongoing changes would be included in the FY 2023-25 Proposed Biennial Budget. Future year funding is contingent on Council budget approval.

The changes, other than the BBB attorney, do not require a transfer from a fund outside the CAO. The BBB attorney funding would entail a transfer from the BBB Fund to the General Fund for the expenditure in the CAO. Again, there is no additional cost to the

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General Fund. If approved, the following budget and position changes are required for the remainder of the current fiscal year:

FY 2022-23 Budget Changes
Fund Dept Account Amount Source
General Fund City Attorney Various Salaries & Wages $36,297 Consumer Protection
General Fund City Attorney Various Salaries & Wages $69,427 Transfer from BBB
Fund to GF
for CAO
General Fund Non-Departmental Transfer in ($69,427)
Big Blue Bus Fund Non-Departmental Transfer out $69,427 FY 2022-23 Position Changes
Fund Dept Delete Add Net
Change
Reason
FTE Title FTE Title
General
Fund
CAO 1.0 Staff Assistant -CAO 1.0 Admin Analyst-CAO - Add/Delete

2.0 Legal Secretary II 2.0 Legal Assistant - Add/Delete

1.0 Receptionist 1.0 Executive Admin
Assistant-CAO
- Add/Delete

1.0 Staff Assistant -CAO 1.0 Executive Admin
Assistant-CAO
- Add/Delete

1.0 Deputy City Attorney II 1.0 Add
Prepared By: Bradley Michaud, Principal Legal Analyst
Approved Forwarded to Council
Attachments:

A. A-RESO-reso-CAO Staffing Changes

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City Council Meeting: February 28, 2023 Santa Monica, California RESOLUTION NUMBER ________(CCS)
(City Council Series)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA

ESTABLISHING A NEW CLASSIFICATION FOR EXECUTIVE ADMINISTRATIVE

ASSISTANT-CAO AND ADOPTING SALARY RATE FOR SUCH CLASSIFICATION

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS:

SECTION 1. The following salary level is hereby established, effective March 12, 2023, for the indicated permanent classification:

Classification Salary Reason
Executive Administrative
Assistant-CAO
$85,932/annual; Step 5 New Classification
SECTION 2. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect.

APPROVED AS TO FORM:
________________________
Douglas Sloan, City Attorney

5.G.a
Packet Pg. 222 Attachment: A-RESO-reso-CAO Staffing Changes (5604 : CAO Salary Reso) 1 February 14, 2023
(NOT APPROVED)

CITY OF SANTA MONICA

CITY COUNCIL MINUTES
FEBRUARY 14, 2023
A regular meeting of the Santa Monica City Council was called to order by Mayor Davis at 5:34 p.m., on Tuesday, February 14, 2023, at City Council Chambers, 1685 Main Street, Santa Monica, CA.

Roll Call: Present: Mayor Gleam Davis
Mayor Pro Tem Lana Negrete
Councilmember Phil Brock
Councilmember Oscar de la Torre
Councilmember Christine Parra
Councilmember Caroline Torosis (arrived at 6:03 p.m.)
Councilmember Jesse Zwick
Also Present: City Manager David White
City Attorney Douglas Sloan
City Clerk Denise Anderson-Warren
CONVENE/PLEDGE On order of the Mayor, the City Council convened at 5:34 p.m., with all members present except Councilmember Torosis. City Attorney Sloan led the assemblage in the Pledge of Allegiance.

GENERAL PUBLIC
INPUT:

Members of the public Denise Barton, Jerry Rubin, Johnathan Foster, Goli Bashamah, and Jill Hawkins commented on various local issues.

PUBLIC INPUT FOR

CLOSED SESSION,

SPECIAL AGENDA

ITEMS AND CONSENT
CALENDAR ONLY:

There were no members public present to comment on closed session items.

There were no members of the public present to comment on special agenda items.

Members of the public Johnathan Foster commented on consent calendar items.

AGENDA

MANAGEMENT
Motion by Mayor Davis, seconded by Mayor Pro Tem Negrete, to hear the Homeless Proclamation (11.A.), the two continued items (8-items), and the Appointment (16.A.) before the Housing Element. The motion was unanimously approved by voice vote, with Councilmember Torosis absent.

PROCLAMATIONS/

COMMENDATIONS

4.A. Proclamation for Women's Heart Health Month, was presented by Mayor Pro Tem Negrete.

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CLOSED SESSIONS
Councilmember Torosis
arrived at 6:03 p.m.

On order of the Mayor, the City Council recessed at 5:56 p.m., to consider closed sessions and returned at 7:06 p.m., with all members present, to report the following:

3.A. Conference with Legal Counsel – Existing Litigation – Litigation has been initiated formally pursuant to Government Code Section 54956.9(d)(1): Jerrid Powell v. City of Santa Monica, et al., Los Angeles Superior Court, Case No. 20STCV15438
The City Attorney advised this matter was pulled and not heard.

3.B. Conference with Legal Counsel – Existing Litigation – Litigation has been initiated formally pursuant to Gov. Code Section 54956.9(d)(1): City of Santa Monica v. The Insurance Company of the State of Pennsylvania, et al., LASC Case No.

The City Attorney advised this matter was pulled and not heard.

3.C. Conference with Legal Counsel – Existing Litigation – Litigation has been initiated formally pursuant to Gov. Code Section 54956.9(d)(1): John VMA Doe, et al. v. City of Santa Monica, et al., Case No. 22STCV30598; John TAU Doe, et al. v. Santa Monica PAL, et al., Case No. 22STCV19401; John Doe 1-4 v. Does 1-50, Case No. 21STCV34537; John Doe 5 and John Doe 6 v. Does 1-50, Case No. 22STCV08765; John JH Doe v. Police Activities League, et al., Case No. 21STCV24491; John Doe (D.C.) v. Santa Monica Police Activities League, et al., Case No. 21STCV47551; John Doe (MU) v. Santa Monica PAL, et al., Case No. 22STCV17022; John Doe #1, John Doe #2 and John Doe #3 v. Santa Monica PAL, et al., Case No. 22STCV03113; John Doe 142 v. Doe 1, Doe 2, and Doe 3, Case No. 22STCV01268; Jose Villaseñor v. City of Santa Monica, et al., Case No. 22STCV17835 - The City Attorney advised this matter was pulled and not heard.

3.D. Conference with Labor Negotiator: Government Code Section 54957.6 -- Agency Designated Representatives: City Manager David White and Chief People Officer Lori Gentles; Bargaining Unit:

FEMA-Santa Monica Fire Executive Management
The City Attorney advised this matter was heard with no reportable action taken.

The City Attorney reported out on two previous cases:

Following the January 24 closed session, the City settled Jessica

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Villalobos-Martinez, et al. v. City of Santa Monica, 21STCV04406, for $350,000; the vote was 7-0.

At the January 24 closed session, the Council approved the City defending the case of California Business Roundtable v. City of Santa Monica, et al., 23-SMCV-00111, by a vote of 5-2, with Brock and Parra voting no.

MOMENT OF SILENCE The Mayor acknowledged a moment of silence for those impacted by the earthquakes in Turkey and Syria. Councilmember Parra shared some Earthquake Readiness tips.

SPECIAL AGENDA
ITEMS:

4.B. City Attorney's Report on Gifts, was presented.

4.C. City Manager's Report - Update on Public Safety, was presented.

REPORT ON COUNCIL
TRAVEL
Councilmember Parra reported that she traveled to the Independent Cities Association in Santa Barbara which covered information about domestic violence from a law enforcement perspective; how to reduce calls for service; how to get services into schools to support students and parents; training teachers to spot the signs of domestic violence; and media training for public officials.

Councilmember Brock reported that he also attended the conference in Santa Barbara where there was discussions about water, guns and liabilities in cities. Sheriff Luna spoke about the importance of officers establishing relationships with their residents. To engage with other city officials was a worthwhile seminar.

CONSENT CALENDAR: All items were considered and approved in one motion unless removed by a Councilmember for discussion.

Motion by Councilmember Brock, seconded by Councilmember de la Torre, to approve the Consent Calendar, reading resolutions by title only and waiving further reading thereof. The motion was approved by the following vote:

AYES: Councilmembers de la Torre, Torosis, Brock, Parra, Zwick Mayor Pro Tem Negrete, Mayor Davis
NOES: None
ABSENT: None
PIER BRIDGE 5.A. Award RFP #SP2060 to Dokken Engineering, Inc. for design of the Pier Bridge Replacement Project, was approved.

Recommended Action

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Staff recommends that the City Council:

1. Award RFP #SP2060 to Dokken Engineering, Inc. for the Pier Bridge Replacement Project to provide engineering design services, permit support, develop construction documents, conduct public outreach, and provide engineering support during the construction phase, for the Public Works Department;

2. Authorize the City Manager to negotiate and execute Agreement No. 11361 (CCS) with Dokken Engineering, Inc., in an amount not to exceed $4,158,400.

3. Direct staff to return to Council for Final Environmental Impact Report/Environmental Assessment (EIR/EA) certification and to commence the final design, only after the Final EIR/EA is certified.

DEPARTMENT OF

JUSTICE GRANT

5.B. Adoption of Resolution No. 11497 (CCS) “A RESOLUTION OF

THE CITY COUNCIL OF THE CITY OF SANTA MONICA

AUTHORIZING THE ACCEPTANCE OF A GRANT AWARD IN THE
AMOUNT OF $115,983 FROM THE STATE OF CALIFORNIA

DEPARTMENT OF JUSTICE, OFFICE OF ATTORNEY GENERAL,
TOBACCO LAW ENFORCEMENT GRANT PROGRAM”, was adopted.

Recommended Action
Staff recommends that the City Council:

1. Adopt the attached resolution authorizing the acceptance of a grant awarded in the amount of $115,983 from the California Department of Justice Tobacco Grant Program for the Tobacco Enforcement program at the Police Department, and to accept all grant renewals.

2. Authorize the City Manager to execute all necessary documents to accept the grant and all grant renewals.

3. Authorize budget changes as outlined in the Financial Impacts & Budget Actions section of this report.

4. Adopt a finding that the Tobacco Grant Program is categorically exempt pursuant to Section 15321 (Class 21, Enforcement Actions) of the California Environmental Quality Act (CEQA) Guidelines.

SOLID WASTE RATE
STUDY

5.C. Approval of Third Contract Modification with R3 Consulting Group, Inc. for Solid Waste Rate Study, was approved.

Recommended Action
Staff recommends that the City Council:

1. Authorize the City Manager to negotiate and execute a third modification to agreement #10781 in the amount of $95,000 with R3 Consulting Group, Inc. for solid waste rate study services for the Public Works Department. This will result in a four-year amended agreement with a new total amount not to exceed $447,075, with future year funding contingent on Council budget approval.

2. Adopt a finding that the modification to agreement is statutorily

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exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15262 of CEQA.

MINUTES 5.D. Minutes of the City Council - Regular Meeting - October 25, 2022, were approved.

MINUTES 5.E. Minutes of the City Council - Regular and Special Meeting - December 13, 2022, were approved.

MINUTES 5.F. Minutes of the City Council - Regular Meeting - January 10, 2023, were approved.

MINUTES 5.G. Minutes of the City Council - Regular Meeting - January 24, 2023, were approved.

PUBLIC INPUT ON

REMAINING AGENDA
ITEMS:

Jim Ries and Leslie Lambert spoke on behalf of the Planning Commission, members of the public Hunter Hall, Natalya Zeritskaya, Amy Anderson and Jerry Rubin commented on Item 7.A.

Members of the public Denise Barton, Natalya Zernitskaya and Jerry Rubin commented on Item 8.A.

Members of the public Denise Barton and Natalya Zernitskaya commented on Item 8.B.

Members of the public Anthony Mollica (time donated by Mark Mollica), Adam Bester and Hunter Hall commented on Item 10.A.

Members of the public Denise Barton and Johnathan Foster commented on Item 11.A.

STUDY SESSION:

HOUSING ELEMENT

7.A. Study Session on Implementation of 6th Cycle (2021-2029) Housing Element Programs, was continued to the February 22, 2023 Special Meeting.

Recommended Action
To ensure that the City of Santa Monica remains in compliance and consistent with its approved 6th Cycle Housing Element of the City’s General Plan, staff recommends that the City Council discuss and provide direction on the policy questions presented in this report regarding the Planning Commission’s recommended amendments to the following:
• Land Use and Circulation Element of the General Plan; • Bergamot Area Plan;
• Downtown Community Plan, and
• The City of Santa Monica Comprehensive Zoning Ordinance, Santa Monica Municipal Code Chapters 9.01 to 9.52,

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City Council is also being asked to discuss and provide direction on the following:
• Amendments to the General Plan Land Use Designation Map and the Official Zoning Map for Consistent Designation of Parcels; • Amendments to the Zoning Ordinance for Consistency with State Law Updates related to Housing Production and Minimum Parking Requirements; and
• Minor Clarifying Amendments to the Zoning Ordinance.

CONTINUED ITEMS:

SUSTAINABLE CITY
PLAN

8.A. Receive and File Sustainable City Plan, Policies, and Programs, was presented.

Recommended Action
Staff recommends that the City Council:

1. Receive and file the City’s Sustainability City Plan, Policies and Programs for the Public Works Department.

2. Adopt a finding of Categorical Exemption pursuant to Section 15307 of the California Environmental Quality Act (CEQA) Guidelines.

Questions asked and answered of staff including: what comes next, specifically with housing and making sure that the infrastructure is there to meet these sustainable goals; what do the tenant incentives look like for electric and other sustainable upgrades; as our city grows, is it safe to say because of our policies that if people lived in other parts of the region, they would probably use more water; doesn’t it make more sense to measure water by per capita instead of by the gallon; how is progress measured with recycling and organics; is there any plan to create a compose waste facility in the city; why is it important to use the ratio of households versus the amount of jobs in the city; is there a way to add in the electric water heaters in the rebate programs; if we adopt standards that require no parking, will the building still be required to have EV charging stations; are the streetside chargers fast or slow chargers; and, is there anything the Council can do to encourage Southern California Edison to upgrade their electrical infrastructure.

Considerable discussion ensued on topics including, but not limited to: it would be nice to make rebates and incentive information for tenants easier to find on the city’s website; a lot of gratitude and thanks for the work that the city staff has done in the subject of sustainability; look at ways to mitigate and improve areas that have been impacted by environmental hazards (i.e. the 10 Freeway or the Airport); give residents some sort of advantage in the local job market; support using the parks as charging stations; and, encouragement to apply for grants that can help us upgrade our infrastructure.

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On the order of the Mayor, the information presented was received and filed.

AGENDA

MANAGEMENT
Motion by Mayor Davis, seconded by Councilmember Brock, to continue the entire Housing Element to the February 22, 2023, Special meeting, with the Public hearing already closed. The motion was unanimously approved by voice vote, with all members present.

POST-PANDEMIC

RECOVERY

8.B. Request of Councilmember Torosis and Mayor Pro Tem Negrete Expediting an Equitable Post-Pandemic Recovery for Santa Monica’s Small Businesses, was presented.

Questions asked and answered of staff included, would it be a friendly amendment to include relocation for small businesses as construction and new building happening around town.

Motion by Mayor Pro Tem Negrete, seconded by Councilmember Zwick, to adopt the staff recommendation, with an amendment. The motion was approved by the following vote:

AYES: Councilmembers Zwick, Parra, Brock, Torosis, de la Torre, Mayor Pro Tem Negrete, Mayor Davis
NOES: None
ABSENT: None
ORDINANCES: 10.A. Introduction and First Reading of an Ordinance Amending Santa Monica Municipal Code Chapter 6.42 that Established the Outdoors Parklet Program, was presented.

Recommended Action
Staff recommends that Council consider:

1. Adopt a finding of Exemption pursuant to Section 15301 of the California Environmental Quality Act (CEQA) Guidelines.

2. Introduction for first reading of an Ordinance amending Santa Monica Municipal Code (“SMMC”) Chapter 6.42 (Attachment A) that established a comprehensive permanent parklet program (“Parklet Program”) to: (a) increase the maximum number of parking and loading spaces that are allowed for the operation of a parklet on the City’s public right-of-way, provided an eligible business meets certain conditions, from up to two spaces total to up to four spaces total; and (b) clarify certain responsibilities of eligible businesses that operate parklets under the Parklet Program.

Questions asked and answered of staff included: can the ordinance be revised to eliminate having to go to the landlord instead of going to the

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owner of a restaurant; can the parklet design requirements be changed; is there a way to reward those businesses that followed the rules to reduce the parklets to two parking spaces; did the original ordinance require the security deposit be made through the City Council; is there a certain formula used to determine how much the security deposit will be; if a business or restaurant moves and abandons their parklet, what happens to that parklet, can the new business take over that parklet; is there a plan to grandfather in those businesses that had more than two parklets; and, what is the security deposit used for other than removal.

Considerable discussion ensued on topics including, but not limited to: if a business owner is grandfathered to have more than two spaces and there is a break in the business, without a transfer, this ordinance only allows the new business to have two spaces for the parklet; expressed support for allowing businesses that previously had larger parklets, to allow them to remain; the security deposit should be capped with a specific percentage increase annually based on indexing for new tenants; supports a cap, as long as it is a cost recovery cap; and, it’s important for local businesses to understand that our cost and fees are far less onerous compared to other jurisdictions to operate a parklet program.

Motion by Mayor Pro Tem Negrete, seconded by Councilmember de la Torre, to introduce and hold first reading of the ordinance reading by title only and waiving further reading thereof, as amended.

The Mayor and City Attorney provided clarification for the updated language: 1) ownership issue, if a proposed parklet will encroach in front of an adjacent property, both the adjacent business and property owner must consent; 2) if there is any break in the operation of the parklet, that the new business would not qualify, and therefore would only be able to operate a maximum of two spaces; and 3) whatever security deposit imposed for operation of a parklet would be tied to cost recovery for the removal and/or operation of the parklet.

The motion was approved by the following vote:

AYES: Councilmembers de la Torre, Brock, Parra, Zwick,
Mayor Pro Tem Negrete, Mayor Davis
NOES: Councilmember Torosis
ABSENT: None
Councilmember Torosis voted no because she does not support spot-zoning to help one specific business when there is already a process in place.

AGENDA

MANAGEMENT
Councilmember de la Torre, seconded by Councilmember Brock, to continue past 11:00 p.m. and hear all items remaining on the agenda. The

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motion was unanimously approved by voice vote, with all members present.

STAFF

ADMINISTRATIVE
ITEMS:

LOCAL EMERGENCY

DECLARATION

11.A. Adoption of Proclamation of the City Council of the City of Santa Monica Declaring a Local Emergency on Homelessness, was presented.

Recommended Action
Staff recommends that Council adopt the attached Proclamation.

Questions asked and answered of staff included: which department will be mostly impacted by this; how much money is in the housing authority fund; when can we expect this to return to Council; is this Emergency proclamation is only for 180-days; what can the residents expect to see done during this 180-days; and, how is it envisions using this proclamation to work with other jurisdictions who are bordered on Santa Monica.

Motion by Councilmember Brock, seconded by Mayor Pro Tem Negrete, to adopt the staff recommendation. The motion was approved by voice vote, with all Councilmembers present.

COUNCILMEMBER
DISCUSSION ITEMS:

DISABILITIES

COMMISSION

16.A. Appointment to two unscheduled vacancies on the Disabilities Commission for a term ending on 6/30/2025 and 6/30/2026, was presented.

The appointment for the term ending on 6/30/2025 was continued to a future date.

On order of the Mayor, the floor was opened for nominations for the term ending on 6/30/2026.

Motion by Councilmember Brock, seconded by Councilmember Torosis to nominate Gerald Rakfeldt.

Gerald Rakfeldt was appointed to the Disability Commission for a term ending June 30, 2026, by acclamation with all members present.

ADJOURNMENT On order of the Mayor, the City Council meeting adjourned at 11:45 p.m. in memory of Jule Lamn and Marnita Carraway.

ATTEST: APPROVED:

Denise Anderson-Warren Gleam Davis
City Clerk Mayor

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Redevelopment Successor
Agency Report
City Council Meeting: February 28, 2023
Agenda Item: 5.I
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To: Redevelopment Successor Agency, Mayor and City Council From: Gigi Decavalles-Hughes, Director, Finance Department, Revenue Subject: Annual Investment Policy Update
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines.

2. Review and approve the City’s revised Investment Policy.

3. Extend the delegation of investment authority to the Director of Finance, as City Treasurer, from March 1, 2023 through February 28, 2024.

Staff also recommends that the Successor Agency Governing Board:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exception) of the California Environmental Quality Act (CEQA) Guidelines.

2. Review and approve the City Investment Policy for Successor Agency Investments.

3. Extend investment authority to the Treasurer of the Successor Agency, from March 1, 2023 through February 28, 2024.

Summary
Per State law, the treasurer or chief fiscal officer of a local agency may annually render an investment policy to its governing body for consideration at a public meeting. While not required, staff believes that it is important to follow best practices and provide transparency by submitting the City’s Investment Policy (Attachments A and B) to Council annually for consideration and approval at a public meeting. The Santa Monica City Charter designates the Director of Finance (as the City Treasurer) as the custodian of all public funds. Additionally, State law requires that the Council delegate investment

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authority to the City Treasurer for a one-year period, renewable annually. The current delegation of authority carries through February 28, 2023.

Discussion
City investments are made only in those instruments specifically authorized by California State laws, primarily Sections 53601, 16429.1, and 53684 et seq. of the Government Code. Within these legal guidelines, the three primary objectives of the City’s Investment Policy and investment practices, in priority order are:
• Safety – Safety of principal is the foremost objective of the City’s investment program. City investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio by diversifying its investments among a variety of securities offering independent returns.
• Liquidity – City investments are kept sufficiently liquid to enable the City to meet all operating requirements which might be reasonably anticipated by structuring the portfolio so that securities mature concurrently with anticipated cash needs to the extent possible. Investments are primarily made in securities with active secondary or resale markets. Additionally, an adequate liquidity buffer is maintained for extraordinary circumstances.
• Rate of Return – The City’s investment portfolio is designed with the objective of attaining a benchmark rate of return throughout budgetary and economic cycles taking into account safety and liquidity requirements. The benchmark may vary from time to time depending on the economic and budgetary conditions present.

The City continues to abide by the highest professional standards in the management of public funds. While the investment strategy is flexible and can change based on market and economic conditions, the legal and policy guidelines governing these investment decisions remain relatively static. The City’s Investment Policy also includes socially responsible investment principles. In addition to following the

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guidelines previously set by Council, the City considers Economic, Social, and Governance (ESG) ratings and performance as well as certain social impact factors when making investment decisions.

On March 8, 2022, Council directed staff to divest City funds from Russian assets.

The City’s general investment portfolio has no direct investments in Russian companies and holds no sovereign Russian debt. As of November 30, 2022, the portfolio does include approximately $79.5 million (book value) in bonds from corporations that had business relationships in Russia or may have investment holdings in Russia. Most have announced a termination, suspension, or limitation of business activity in Russia. Additional detail is included in the April 6, 2022 Information Item included as an attachment to this report. Sale of all bonds of companies that had been doing business in Russia would result in a loss of approximately $6.2 million (based on 11/30/2022 market values), which would cause fiscal harm to the City. The City’s Russian divestment actions as outlined in the April 6, 2022 Information Item will remain in place.

On an on-going basis, staff reviews public agency investment best practices and regulatory or legal changes to ensure City compliance. There were three minor legislative changes related to investment of public funds adopted by the State in 2022 per SB 1489, none of which have a material impact on City investment practices.

The first change clarified that a public agency investment’s term or remaining maturity is to be measured from the settlement date to final maturity. The City already follows this practice. In addition, SB 1489 amended State law to prohibit the purchase of a security with a forward settlement date exceeding 45 days from the time of investment. Again, the City already follows this practice. Finally, the bill also increased the timeline for the treasurer or chief fiscal officer to present a quarterly investment report to the chief executive officer, the internal auditor, and the legislative body of the local agency by 15 days, from 30 to 45 days following the end of the quarter. Per the City Charter, staff provides a monthly information item that serves as the investment report.

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The other changes to this year’s policy are minor clarifying wording changes and correction of typos.

Environmental Review
The updated investment policy is categorically exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines. The policy is covered by the common sense exemption which states that CEQA does not apply, “where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” Therefore, it can be seen with certainty that actions would not result in adverse physical impacts on the environment, and as such, is categorically exempt from CEQA.

Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the recommended actions. Staff provides monthly reports to the City Council and the City Manager describing the present status of City investments and monies held by the City, as well as summarizing all investment transactions for the month. Interest earnings from the City’s pooled investment portfolio are allocated to the various City funds based upon each fund’s share of total City cash and investments. Projected investment earnings for each fund are included in the FY 2022-23 Revised Budget.

Prepared By: David Carr, Assistant City Treasurer
Approved Forwarded to Council
Attachments:

A. Information Item Russian Divestment
B. Annual Update on City Investment Policy-Final REVISED 2022 C. Annual Update on City Investment Policy-Final REVISED 2023

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Information Item
1 Date: April 6, 2022
To: Mayor and City Council
From: Gigi Decavalles-Hughes
Subject: Report on the City of Santa Monica’s Direct and Indirect Investments in and Divestment from Russian Assets
Introduction
On March 8, 2022, the Council approved Agenda Item 13-A condemning the invasion of Ukraine by Russia. As part of the approved action, Council directed the City Manager to research any sanctions or steps the City of Santa Monica might take to deplete the power of the Russian leader, Vladimir Putin, and any Russian Oligarchs, including divesting any city fund possessing Russian assets, and lobbying CalPERS in favor of divesting any state funds possessing Russian assets and the termination of state contracts with Russian firms.

Background
The City’s investment policy has historically included socially responsible guidelines.

Examples of this include the prohibition of investments in fossil fuel-related companies and banks that lend to those companies, in tobacco or tobacco-related products, and in weapons systems or nuclear power. Also, the environmental, social, and governance (ESG) profile of corporations is a component of credit analysis when considering investments in corporate medium-term notes. Additionally, Council has at times directed divestments based on certain geopolitical and/or humanitarian reasons.

Examples of these are South Africa during apartheid and Myanmar following a military coup and subsequent human rights violations.

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Packet Pg. 236 Attachment: Information Item Russian Divestment (5566 : Annual Investment Policy Update) Information Item: City of Santa Monica’s Direct and Indirect Investments in and Divestment from Russian Assets
2 The City’s general investment portfolio has no direct investments in Russian companies and holds no sovereign Russian debt. The City also oversees the Cemetery and Mausoleum Perpetual Care funds through the use of an outside investment manager.

This portfolio also has no direct investment in Russian companies or Russian debt.

Discussion
As of February 28, 2022, the book value of the City’s investment portfolio (exclusive of cash in bank accounts) was $572.8 million. The City of Santa Monica holds no investments in any Russian companies or Russian sovereign debt. The City does own bonds in companies that had business operations in Russia at the time of the Ukraine invasion.

Corporate Debt
As of February 28, 2022, the City’s portfolio included approximately $124.8 million in corporate debt. Of this amount approximately $17.8 million was in bonds from United States based non-profit entities that do not have business in Russia. The remaining $107 million was bonds issued by 23 private corporations and the endowment funds of two universities. One of the corporate bonds ($2 million) matured in March 2022 reducing the outstanding amount to $105 million issued by 22 corporations. Staff has attempted to ascertain the level of divestment from Russia of the entities from which it holds investments. It can be difficult to get the complete picture since many companies’ operations in Russia are through third party arrangements with other corporations.

The two business sectors with the most exposure to and business relationship with Russia are the oil and banking sectors. Since the City has already divested from fossil fuel companies and banks lending to such companies, the current investment portfolio has no investments related to Russia from these sectors. Two of the companies that have bonds included in the portfolio do not appear to do business in Russia. The two university endowment funds mentioned, Yale University and Texas A&M University, have announced plans to pull all investments in Russian entities.

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3 Of the remaining 18 companies for which the City holds bonds in its investment portfolio, 12 have publicly announced either a termination, suspension, or limiting of business activities in Russia. The other four are insurance companies. Since insurance companies maintain large investment portfolios, the exposure to Russia could be to Russian businesses or the holding of investments in Russia. Staff has not been able to determine the extent of Russian involvement of these companies in Russia and have seen no public statements regarding divestment.

Supranationals
The portfolio also includes approximately $25.6 million in bonds issued by World Bank related institutions such as the International Bank for Reconstruction and Development and the International Finance Corporation. These bonds, also known as Supranationals, provide funding for projects related to clean water, climate change, and infrastructure enhancement. Russia is a member of the World Bank. On March 2, 2022, the World Bank halted all programs in Russia due to their war on Ukraine.

Local Agency Investment Fund (LAIF)
LAIF is a short-term investment pool managed by the California State Treasurers Office used by over 400 local agencies in California, including Santa Monica, for short-term cash and liquidity needs. LAIF has announced that it has no investments in Russian entities.

Cemetery and Mausoleum Perpetual Care Funds
The City oversees the Cemetery and Mausoleum Perpetual Care funds through use of an outside investment manager. This portfolio follows the same socially responsible investment guidelines included in the City’s Investment Policy. This portfolio has no direct investment in Russian companies or Russian debt and is also divested from the Russia-heavy sectors of fossil fuels and banking.

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Packet Pg. 238 Attachment: Information Item Russian Divestment (5566 : Annual Investment Policy Update) Information Item: City of Santa Monica’s Direct and Indirect Investments in and Divestment from Russian Assets
4 CalPERS
The California Public Employees Retirement System (CalPERS) is the United States' largest public fund. CalPERS has reported that it has over three quarters of a billion dollars in Russian investments, consisting of $420 million in public stocks and $345 million in illiquid real estate assets. None of CalPERS holdings include Russian government debt.

Although these are sizable amounts, CalPERS claims that combined they represent only

0.17% of its total investment portfolio.

In response to Russia's attack on Ukraine, CalPERS has announced the following actions:
• CalPERS has ceased all transactions in Russian publicly traded equity and has stopped the flow of any new investments into the country. • CalPERS is actively assessing its real estate investments and determining a path forward.
• CalPERS is reviewing all its investments in emerging markets, including Russia, due to the impacts the crisis has had on all financial markets. • CalPERS is following all regulatory requirements promulgated by U.S. Office of Foreign Assets Control and the sanctions that are in place.

SB 1328, recently introduced in the State legislature, would require CalPERS to divest from Russian and Belarusian assets and companies. SB 1328 would prohibit CalPERS (and other public retirement systems) from investing public employee retirement funds in a company with business operations in Russia or Belarus or a company that supplies military equipment to Russia or Belarus. It would also prohibit future State investments in Russia or Belarus until the invasion is over and sanctions removed.

Summary and Recommendations
Santa Monica has no direct investments in Russian companies or the Russian government. The City does own bonds issued by a number of companies that have historically done business in Russia, but not from the most heavily invested sectors of fossil fuels and banking. For the most part, entities in which the City does hold

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5 investments have announced plans to either terminate, suspend, or limit business in Russia.

Based on staff’s review, the following actions are recommended:

1. No current investments will be sold based on the Russian invasion. Sale of all the bonds of companies that were doing business with Russia would result in a loss of approximately $2.7 million which would cause fiscal harm to the City. Sale of the Supranationals would add another $0.7 million to the loss. Attachment A includes a listing of the bonds, their involvement in Russia, and includes the estimated loss the City would realize if the investments were sold.

2. Until such time either (1) Russia halts the invasion and occupation of Ukraine as determined by the U.S. Department of State; or (2) The United States revokes all sanctions against Russia imposed because of its participation in the February 24, 2022, invasion of Ukraine, no new investments should be made in companies that have not announced a termination, suspension, or limitation of business in Russia.

3. Staff will continue to monitor the status of entities and their Russian business activity and may restrict future new investments in companies that resume business operations in Russia or do not adequately reduce their business operations in Russia before 1) Russia halts the invasion and occupation of Ukraine as determined by the U.S. Department of State; or (2) The United States revokes all sanctions against Russia imposed because of its participation in the February 24, 2022, invasion of Ukraine.

4. The City supports SB 1328 calling for the CalPERS divestment of all Russian assets.

On March 21, 2022, Mayor Sue Himmelrich sent a letter of support for SB 1328 on behalf of the City. The letter is attached as Attachment B.

Prepared By: Gigi Decavalles-Hughes, Director of Finance Attachments: A. SB 1328 Letter to Senator McGuire
B. City of Santa Monica Corporate Investments with Status of Russian Exposure

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6 ATTACHMENT A
SB 1328 LETTER TO SENATOR MCGUIRE

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8 ATTACHMENT B

CITY OF SANTA MONICA CORPORATE INVESTMENTS WITH STATUS OF RUSSIAN EXPOSURE

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Packet Pg. 244 Attachment: Information Item Russian Divestment (5566 : Annual Investment Policy Update) 1 Revised 2/20232
ATTACHMENT 1

INVESTMENT POLICY FOR THE CITY OF SANTA MONICA

1. POLICY
It is the policy of the City of Santa Monica (City) to invest public funds in a manner which will safely preserve portfolio principal, provide adequate liquidity to meet the City’s cash flow needs, and optimize returns while conforming to all federal, state, and local statutes governing the investment of public funds. Should any applicable provisions of these statutes change from those included herein, such provision shall be considered incorporated in the policy. The policy should be submitted to the City Council annually for review and approval.

2. SCOPE
This investment policy applies to all cash and financial investments of the various funds of the City of Santa Monica as identified in the City's Annual Financial Report, with the exception of those financial assets explicitly excluded from coverage by the Investment Policy for legal or operational reasons. Cemetery and Mausoleum Perpetual Care Funds are private funds held in trust and managed by the City.

These funds do not fall under the guidelines of the Government Code sections noted in Section 8.0 of this Policy but are invested by an outside investment manager under guidelines established by the City Council.

All City funds are listed in Attachment 1-A. The Investment Policy will also apply to all new funds created unless specifically exempted.

Except as otherwise noted, City funds are pooled for investment purposes.

Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

Interest is allocated on a quarterly basis.

3. PRUDENCE
All investments and evaluation of investments shall be made with the Prudent Investor Standard as set forth in California Government Code Section 53600.3.

Investments shall be made with judgment and care, under circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency.

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Packet Pg. 245 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 2 The standard of prudence shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and the investment policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments.

4. INVESTMENT OBJECTIVES
The primary objective of all City investments, in priority order, shall be:

4.1 SAFETY
Safety of principal is the foremost objective of the investment program. City investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this, the City will diversify its investments by investing funds in securities of various types and maturity dates, and from various issuers offering independent returns.

4.2 LIQUIDITY
Liquidity is the ability to change an investment into its cash equivalent on short notice at its prevailing market value. The City’s investment portfolio shall remain sufficiently liquid to enable the City to meet all operating requirements which might be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrently with anticipated cash needs.

Since all possible cash demands cannot be anticipated, the portfolio will maintain a liquidity “buffer” and invest primarily in securities with active secondary or resale markets.

4.3 RATE OF RETURN
The City’s investment portfolio shall be designed with the objective of attaining a benchmark rate of return throughout budgetary and economic cycles, taking into account safety and liquidity requirements. The benchmark may vary from time to time depending on the economic and budgetary conditions present. At no time shall funds be invested in any security that could result in zero interest accrual if held to maturity except as specified in Section 8.2 of this policy.

5. INVESTMENT AUTHORITY DELEGATION
In accordance with the Santa Monica City Charter, Section 711, the City Council delegates to the City Treasurer the authority to invest City funds. The Director of Finance, as City Treasurer, delegates this authority to the Assistant City Treasurer.

In the absence of the Director of Finance and the Assistant City Treasurer, the

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Packet Pg. 246 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 3 Treasury Administrator or the Senior Treasury Analyst may execute investment transactions per instructions from the Director of Finance and/or Assistant City Treasurer or per prior written authorization. Section 53607 of the State of California Government Code limits the authorization of the legislative body to delegate investment authority to a one- year period, renewable annually.

5.1 INVESTMENT PROCEDURES
The Director of Finance is responsible for conducting and reporting on all City investments. To facilitate this function, the Director of Finance or their designee will prepare and maintain an Investment Procedures Manual detailing procedure for the operation of the investment program consistent with this policy. The manual should include reference to safekeeping, banking services contracts, collateral/depository agreements, and repurchase agreements. The manual shall also include explicit delegation of authority to persons responsible for investment transactions. No person may engage in investment transactions except as provided under the terms of this policy and the procedures established by the Director of Finance. Additionally, the manual will explicitly include a current listing of all City of Santa Monica financial institution deposit and investment accounts, a current copy of or link to State laws pertinent to City investments, a description of specific controls to ensure the proper execution of the City Investment Policy, and copies, with instructions, of all investment reports required by law or by City Investment Policy.

5.2 INVESTMENT COMMITTEE
An Investment Committee (the Committee) shall be established consisting of the City Manager, the Assistant City Manager, the Director of Finance, the Assistant City Treasurer, one other department head serving one-year terms on a rotating basis, and one qualified citizen representative, appointed by the City Manager for a one-year term, who possesses strong skills and knowledge in the areas of finance and economics. The one-year terms for the citizen representative and the department head may be extended at the discretion of the City Manager. The purpose of the Committee is to provide general oversight and act in an advisory capacity. The Committee will attempt to meet once each calendar quarter to review and evaluate previous investment activity, to review the current status of all funds held by the City, to discuss anticipated cash requirements and investment activity for the next quarter, and to discuss investment strategy.

6. ETHICS AND CONFLICTS OF INTEREST
The Director of Finance and other employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. The Director of Finance and other employees involved in the investment process shall disclose any material interests in financial institutions with

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Packet Pg. 247 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 4 which they conduct business within their jurisdiction, and they shall further disclose any material personal financial/investment positions that could be related to the performance of the City’s investment portfolio and shall refrain from personal investment transactions with the same individual or firm with whom business is conducted on behalf of the City.

The Director of Finance and other employees involved in the investment process are required to file annual disclosure statements as required by the Fair Political Practices Commission. During the course of the year, if there is an event subject to disclosure that could impair the ability of the Director of Finance or investment employees to make impartial decisions, the City Council will be notified in writing within ten (10) days of the event.

7. AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS
The City shall transact business only with issuers, banks, savings and loans, and registered securities dealers. The purchase of any investment, other than those purchased directly from the issuer, shall be purchased from either an institution licensed by the State as a broker/dealer as defined in Section 25004 of the Corporation Code, who is a member of FINRA (Financial Industry Regulatory Authority), or a member of a federally regulated securities exchange, a national or state chartered bank, a federal or state association (as defined by Section 5102 of the Financial Code), or a brokerage firm designated as a primary dealer by the Federal Reserve Bank.

The Director of Finance’s staff shall periodically conduct a “Request for Qualifications” process to investigate broker/dealers that wish to do business with the City. All institutions that desire to become a broker/dealer for the City must complete the City’s “Broker/Dealer Request for Information” and “Broker/Dealer Certification”. Staff will evaluate broker dealers based on the qualifications of the firm and the individual broker(s) assigned to the City. The evaluation will be based on experience of the broker in servicing public fund investment portfolios, market capitalization of the firm, the brokers’ ability to access markets in securities appropriate to the City’s needs, and the brokers’ agreement to abide by the City’s Investment Policy. Selection as an approved broker/dealer does not guarantee the that the firm will conduct any investment transactions with the City The Director of Finance shall conduct periodic reviews of the financial condition and other qualifications of all approved financial institutions and broker/dealers to determine if they continue to meet the City’s guidelines for qualification as defined in this section. Additionally, the City shall keep the current audited financial statements on file for each approved financial institution and broker/dealer with which the City conducts investment transactions. A listing of websites where these financial statements may be viewed may substitute for physical hard copies of the statements.

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Packet Pg. 248 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 5 8. AUTHORIZED AND SUITABLE INVESTMENTS
Investments shall be made only in those instruments specifically authorized by California State laws, primarily Sections 53601, 53601.6, 53601.8, 16429.1, and 53684 et seq. of the Government Code and to no greater an extent than authorized by those laws. These laws are summarized in Attachment 1-B.

Additional City guidelines are as follows:

Instruments Additional City Guidelines
U.S. Federal Agencies No more than 50% of portfolio, per agency Banker's Acceptances (BA) Maximum of 10% of portfolio per issuer Negotiable Certificates of Deposit Maximum of 10% of portfolio per issuer (NCD)
Commercial Paper (CP) Maximum of 25% of portfolio
It is recognized that legal or other events may occur that could require exceptions to certain guidelines. The percentages listed in the above guidelines are based on book value of the portfolio at the time of purchase.

In addition to following all legal guidelines, the portfolio will preserve principal, maintain adequate liquidity to meet all City obligations, contain an appropriate level of interest rate risk, and be diversified across types of investments, maturities, and institutions to minimize credit risk and maintain an appropriate return.

8.1 REPURCHASE AGREEMENTS
Investments in repurchase agreements are allowable and shall be made only with financial institutions with which the City has an executed master repurchase agreement. The financial institution must be a primary dealer of the Federal Reserve Bank of New York.

8.2 PROHIBITED INVESTMENTS AND TRANSACTIONS
a) Prohibited investments include as inverse floaters, range notes, interest only strips derived from a pool of mortgages (collateralized mortgage obligations), and any security that could result in zero interest accrual if held to maturity, as specified in Section 53601.6.
b) Notwithstanding the prohibition in paragraph (a), the City may invest in securities issued by, or backed by, the United States government that could result in zero- or negative-interest accrual if held to maturity, in the event of, and for the duration of, a period of negative market interest rates.

This shall remain in effect only until January 1, 2026.

8.3 INVESTMENTS HELD AND/OR MANAGED BY FISCAL AGENTS

A N D TRUSTEES
In addition, the main pooled portfolio, the City may hold and invest certain

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Packet Pg. 249 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 6 other funds that are restricted as to use. One example is bond proceeds held by fiscal agents. Investments of bond or loan proceeds will be made in accordance with Government Code Section 53601 (m), which states that money from bond proceeds should be invested as specified by bond documents, and in accordance with specific bond covenants. In most cases these investments will be made under the same guidelines as other City investments. Another example is funds received from legal settlements that are restricted for a certain purpose, which will be invested in accordance with legal or escrow agreements that may be more restrictive than the City’s Investment Policy.

As noted previously in this Policy, Cemetery and Mausoleum Perpetual Care Funds are private funds held in trust by the City. These funds are invested by an outside investment manager under guidelines adopted by the City Council and do not fall under the guidelines of the Government Code sections noted in Section 8.0 of this Policy. The Director of Finance’s staff monitors all investment activity of these funds to ensure guidelines are followed.

9. INVESTMENT POOLS/MUTUAL FUNDS
A thorough investigation of any pooled investment funds, including mutual funds, is required prior to investing, and on a continual basis. To accomplish this, a questionnaire will be used to evaluate the suitability of the pooled fund. The questionnaire will answer the following general questions:
• A description of eligible investment securities, and a written statement of investment policies and objectives.
• A description of interest calculations and how it is distributed, and how gains and losses are treated.
• A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited. • A description of who may invest in the program, how often, and what size deposit and withdrawal are allowed.
• A schedule for receiving statements and portfolio listings. • Are reserves, retained earnings, etc., utilized by the pool/fund? • A fee schedule, and when and how fees are assessed.
• Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds? For mutual funds, a fund prospectus can substitute for the questionnaire.

10. COLLATERALIZATION
California Government Code Sections 53652, et seq. requires depositories to post certain types of collateral for public funds above the Federal Deposit Insurance

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Packet Pg. 250 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 7 Corporation (FDIC) insurance amounts. The collateral requirements apply to bank deposits, both active (checking and savings accounts) and inactive (non-negotiable certificates of deposit).

Collateralization is also required for repurchase agreements. In order to anticipate market changes and provide a level of security for all funds, the collateralization level will be 102% of the market value of principal and accrued interest, and the value shall be adjusted no less than quarterly. Collateral will be in the form of U.S.

Treasury Obligations or U.S. Agency Securities.

Collateral will always be held by an independent third party with whom the entity has a current custodial arrangement. A clearly marked evidence of ownership (safekeeping receipt) must be available to be supplied to the City, if requested, and retained. The right of collateral substitution is granted.

11. SAFEKEEPING AND CUSTODY
In accordance with California Government Code Section 53601, all securities owned by the City shall be held in safekeeping by the City’s custodial bank or a third-party bank trust department, acting as an agent for the City under terms of the custody agreement. Collateral for repurchase agreements will be held by a third-party custodian under terms of the Master Repurchase Agreement.

All securities will be received and delivered using a delivery vs. payment (DVP) basis, which ensures that securities are deposited with the third-party custodian prior to the release of funds. Securities held by the third-party custodian will be evidenced by safekeeping receipts and/or bank statements. Investments in the State Local Agency Investment Fund (LAIF) or money market mutual funds are undeliverable and are not subject to delivery or third-party safekeeping.

Investment trades shall be verified against bank transactions and broker confirmation tickets. On a monthly basis, the custodial asset statement shall be reconciled with the month-end portfolio holdings.

12. DIVERSIFICATION
The City will diversify its investments by security type, institution, and maturity date.

Concentration limits are set by the State Government Code (see Attachment B) and Section 8.0 (Authorized and Suitable Investments) of this policy.

13. MAXIMUM MATURITIES
To the extent possible, the City will attempt to match its investments with anticipated cash flow requirements. Most investments will be made inThe City will not invest in Formatted: Not Expanded by / Condensed by

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Packet Pg. 251 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 8 securities with a term remaining to maturity in excess of five years or less. However, on February 22, 2022,unless the City Council has granted authority to invest in securities with a remaining term in excess of five years as part of the City’s overall investment program. Per thatCouncil authorization, up to 15% of the portfolio value may be invested in U.S. government or Federal Agency securities with remaining maturities at the time of purchase between five and fifteen years. Per State law, the settlement date of the investment purchase is considered the start date of the remaining term to maturity. Further maturity limitations per State Code are shown in Attachment B. The weighted average maturity of the investment portfolio should be three years or less.

In order to minimize the impact of market risk, most investments will be purchased with the intent to hold to maturity. Investments may be sold prior to maturity for cash flow needs, portfolio rebalancing and/or appreciation purposes, or in order to mitigate portfolio risk by limiting potential losses. However, no investment shall be made based solely on earnings anticipated from capital gains. Due to the uncertain nature of cash flow requirements, a portion of the portfolio should be continually invested in readily available funds.

14. INTERNAL CONTROLS
The Director of Finance shall be responsible for ensuring that all investment transactions comply with the City’s Investment Policy and for establishing internal controls that are designed to prevent losses due to fraud, negligence, and third-party misrepresentation.

The Director of Finance will also establish internal control procedures addressing wire transfer controls, separation of duties and administrative controls, avoidance of collusion, separation of transaction authority from accounting procedures, documentation of investment transactions, and monitoring of results.

As part of its annual audit of the City, the City’s external auditor will review compliance with statutes, policies, and procedures.

15. PERFORMANCE STANDARDS
The portfolio shall be designed with the objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with investment risk constraints and cash flow needs.

15.1 MARKET YIELD (Benchmark)
The City’s overall investment strategy is passive. Given this strategy, the basis used by the Director of Finance to determine whether appropriate and suitable market yields are being achieved shall be to identify a comparable benchmark to the portfolio’s investment duration, e.g.e.g., the Constant

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Packet Pg. 252 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 9 Maturing Two Year Treasury bill index. Benchmarks may change over time depending on the portfolio’s duration.

16. REPORTING
In accordance with State law and the City Charter, monthly reports will be made to the City Council and the City Manager describing the present status of City investments and monies held by the City, as well as summarizing all investment transactions for the month. Schedules in the monthly report should include the following:
• A complete list of investments including the type of the investment, name of the issuer, maturity date, par value, book value, and market value • The source of market value data
• The weighted average maturity and yield to maturity of the portfolio • Coupon, discount, or earnings rate for each security
• Percentage of portfolio represented by each investment category • A certification of compliance with the Investment Policy • A statement denoting the City’s ability to meet its anticipated expenditures requirements for the next six months
• Benchmark comparison
Records of all investment transactions will be kept and filed in the Finance Department in accordance with legal guidelines and records retention policies.

17. SOCIALLY RESPONSIBLE INVESTING
RESTRICTIONS – The direct investment of City funds are restricted as follows:
a. Investments should be made in entities that support clean and healthy environment, including following safe and environmentally sound practices. b. No investments will be made in fossil fuel companies as defined by the “The Carbon Underground 200” list maintained and published by the organization Fossil Free SolutionsIndexesFFI Solutions or in banking institutions that provide financing to said companies.
c. No investments are to be made in tobacco or tobacco-related products. d. No investments are to be made to support the production of weapons, military systems, or nuclear power.

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Packet Pg. 253 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 10 e. Investments should be made in entities that support equality of rights regardless of sex, race, age, disability or sexual orientation.
f. Investments should be made in entities that promote community economic development.

Funds invested with a trustee and/or outside investment managers such as the Cemetery and Mausoleum Perpetual Care Funds will comply with this section of the policy.

18. COMMUNITY REINVESTMENT ACT (CRA)
The City will deposit funds only in those financial institutions, which have a CRA rating (as determined by the appropriate regulatory body) of "Outstanding" or "Satisfactory".

19. INVESTMENT POLICY ADOPTION
The City’s investment policy shall be reviewed and adopted by the City Council annually. The Investment Committee will review the policy periodically to ensure its consistency with the overall objectives of preservation of principal, liquidity, and return, and its conformance with current law, financial and economic trends, and cash flow needs of the City.

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Packet Pg. 254 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) A-1
ATTACHMENT 1-A
City of Santa Monica Funds for Cash Pooling
The following listed City of Santa Monica funds shall have their cash balances pooled for investment purposes.

FUND

NUMBER FUND NAME
1 GENERAL FUND
10 SPECIAL REVENUE SOURCE FUND
11 BEACH RECREATION FUND
12 HOUSING AUTHORITY FUND
14 TENANT OWNERSHIP RIGHTS CHARTER AMENDMENT
16 CLEAN BEACHES AND OCEAN PARK PARCEL TAX FUND
17 TRAFFIC SAFETY FUND
18 SCAQMD AB2766 FUND
19 COMMUNITY DEVELOPMENT BLOCK GRANT (CBDG) FUND
20 MISCELLANEOUS GRANTS FUND
21 ASSET SEIZURE FUND
22 CITIZENS OPTION FOR PUBLIC SAFETY FUND
25 RENT CONTROL FUND
26 GAS TAX FUND
27 LOCAL RETURN FUND
28 PARKS AND RECREATION FACILITIES FUND
41 LOW/MODERATE INCOME HOUSING ASSET FUND
50 WATER FUND
51 WASTEWATER FUND
52 STORMWATER MANAGEMENT FUND
53 PIER FUND
54 RESOURCE RECOVERY & RECYCLING FUND
55 COMMUNITY BROADBAND FUND
57 AIRPORT FUND
59 CEMETERY FUND
60 BIG BLUE BUS FUND
61 PARKING AUTHORITY FUND
70 VEHICLE MANAGEMENT FUND
71 INFORMATION TECHNOLOGY REPLACEMENT & SERVICES FUND
72 SELF INSURANCE-GENERAL LIAB/AUTO FUND
73 SELF INSURANCE-BUS FUND
74 SELF INSURANCE WORKERS-COMPENSATION FUND
75 SELF INSURANCE-ADMIN FUND
80 GENERAL TRUST FUND
81 CEMETERY PERPETUAL CARE FUND
82 MAUSOLEUM ENDOWMENT FUND

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Packet Pg. 255 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) B-1
ATTACHMENT 1-B
Summary of State of California Statutes Applicable to Municipal Investments The following investments are authorized by California State Code, Title 5, Division 2, and Sections 53600, 53601, 53631.5 and 53635. See code sections for complete descriptions.

Authorized Investment Legal Limit
(%)
Other Constraints
Local Agency Bonds No limit Maximum maturity 5 years.**** U.S. Treasury Obligations No limit Maximum maturity 5 years except as noted below.****
State Obligations -
California and Others
No limit Maximum maturity 5 years.

California Local Agency
Obligations
No limit Maximum maturity 5 years.

U.S. Agency Obligations No limit Maximum maturity 5 years except as noted below.****
Bankers’ Acceptance 40% Eligible for purchase by the Federal Reserve System and not to exceed 180
days to maturity. No more than 30% may
be in bankers' acceptances of any one
commercial bank.

Commercial Paper – Non
Pooled Funds
40% "A -1 /P - 1/F - 1" rating; if the issuer has
long-term debt, it must rated “A”; U.S.
corporate assets over $500,000,000;
purchases may not represent more than
10% of outstanding commercial paper
and medium-term notes. Commercial
paper may not exceed 270 days to
maturity.***
Commercial Paper –
Pooled Fund
40% "A -1 /P - 1/F - 1" rating; if the issuer has
long-term debt, it must rated “A”; U.S.
corporate assets over $500,000,000;
purchases may not represent more than
10% of outstanding paper and may not
exceed 270 days to maturity.

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Packet Pg. 256 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) B
-2
Authorized Investment Le
gal Limit
(%)
Other Constraints
Negotiable Certificates of
Deposit
30% Maximum maturity 5 years. State and
Federally chartered banks and savings
institutions, including U.S. branches of
foreign banks regulated by State
regulatory authorities (“Yankee CD”).

Deposit/CDPlacement
Services
50%**Maximum maturity5years. Deposits with
any oneprivatesectorplacementservice
are limitedto50% oftheportfolio. This limit does not apply to placement servic e-
assisted CD’s.

RepurchaseAgreement No limit
Maximum maturity1year. Securities
usedas collateralfor repo's mustbe investments allowable under Govt. Co de
(i.e.,T-bills, Agencies,BAs,CDs,etc.);
mustbe collateralizedat 102%of market
valueor greater; securities mustbesafe
keptby third party.

Reverse Repurchase
Agreements/Securities
LendingAgreements
20%Mustbemadewithprimary dealersofthe
Federal Reserve BankofNewYork and
the securities usedfor theagreement
must have been heldby the local agency
forat least30 days. The maximum
maturity is 92 days.

Medium-TermCorporate
Notes
30%Maximum maturity5years; bonds must
be rated minimumof “A”bya nationally
recognized ratingservice.

Mutual Funds and Money
Market Mutual Funds
20% No mo
rethan 10%maybe invested in
any onemutual fund. Funds are invested in securities and obligati ons
authorizedbysub-divisions (a) through
(m) ofSection53601and
53635,(anyoftheauthorized investments for local agencies) the investment company must be in highest ranking provided by not less than two of the three largest nationally recognized ratingservices OR must havethe investment advisor registered with th e
SEC withno less than5yrs. experience
and haveassetsunder mgmt. inexcess
of $500million.

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Packet Pg. 257 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) B
-3
Authorized Investment Le
gal Limit
(%)
Other Constraints
SupraNationals
(International Bankfor
Reconstruction and
Development. International Fin
ance
Corporation, Inter-
AmericanDevelopment
Bank
30%
Maximum maturity5years. Mustbe
ratedAA or better byanationally
recognized rating service. Mustbe
senior unsubordinated obligations
denominated inU.S. Dollars.

Money Market Funds 20%The moneymarketfunds musthavean
averageweighted maturityof90days or less and abide by SEC regulations; funds must receive the highest ranking by 2 of the 3 largest nationally recognized ratingagencies OR retainan investment advisor who is registered, or exempt from registration, with the SEC and has at least 5 years’ experience managingmoneymarketfunds in
excess of $5
00million.

CollateralizedCertificate
ofDeposit
No limitMaximum maturity5years. Banks:
deposit nottoexceedthetotal ofpaid-in
capital surplus. S&Ls:deposit notto
exceedthe greater oftotal networthor
$500,000.State andFederal credit
unions: deposit shall not exceedthe
greaterofthetotal ofunpaired capital and
surplusor $500,000. Mustbe
collateralizedto 110%ofthe CD valueby
othereligiblesecurities. Investments in
certificatesofdepositsofstateorfederal
credit unions if anymemberofthe city’s
governingor managingofficers (council,
city manager,fiscal officers) serves on
the credit unionboard or keycommittee
positions is prohibited.

MortgagePass-Through 20%Maximum remaining maturity of 5years; bonds mustbe rated intoptwo rating
categories by a nationally recognized
ratingservice. Shall not exceed95% of
themortgagesecurity's fair marketvalue.

Bank/Time Deposits No limitMaximum maturityof5years.

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Packet Pg. 258 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) B-4
Authorized Investment Legal Limit
(%)
Other Constraints
Local Agency Investment
Fund (LAIF)
$ 75 million* Monies are invested in pooled state fund
managed by State Treasurer. Maximum
15 transactions per month.

Joint Powers Authority
Pool
No limit
County Pooled
Investment Funds
No limit
Public Bank No limit Commercial paper, debt securities, or other obligations of a public bank, as
defined in Section 57600.
* Per LAIF account. Separate accounts can be established for different legal entities. ** Per AB 945, limit increased from 30% to 50% effective January 1, 2020 until January 1, 2026, at which time limit will return to 30%.
*** In effect until January 1, 2026.
**** Per Council authorization, up to 15% of the portfolio may be invested in remaining term to maturity of over five and up to- fifteen years.

Bond Proceeds
Bond proceeds may be invested in accordance with the State Code and bond indenture provisions.

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Packet Pg. 259 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) C-3
ATTACHMENT 1-C

GLOSSARY
AGENCIES: Federal agency securities and/or Government Sponsored Enterprises (GSE’s).

ANNUAL COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFRACFR): The official annual report for the City of Santa Monica. It includes basic financial statements for each individual fund and account group prepared in conformity with GAAP. It also includes supporting schedules necessary to demonstrate compliance with finance-related legal and contractual provisions, extensive introductory material, and a detailed Statistical Section.

ASKED: The price at which securities are offered for sale.

BANKERS’ ACCEPTANCE (BA): A draft or bill of exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer.

BASIS POINT: A basis point equals one one-hundredth of 1% (.01%).

BENCHMARK: A comparative base for measuring the performance or risk tolerance of an investment portfolio. The benchmark should represent a close correlation to the level of risk and the average duration of the portfolio.

BID: The price offered for securities.

BROKER: A broker brings buyers and sellers together for a commission.

CALLABLE SECURITY: A security that can be redeemed by the issuer before the scheduled maturity date.

CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a certificate. Large denomination CD’s are typically negotiable.

COLLATERAL: Securities, evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.

COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR): The official annual report for the City of Santa Monica. It includes basic financial statements for each individual fund and account group prepared in conformity with GAAP. It also includes supporting schedules necessary to demonstrate compliance with finance-related legal and contractual provisions, extensive introductory material, and a detailed Statistical Section.

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Packet Pg. 260 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) C-3
COMMERCIAL PAPER (CP): An unsecured promissory note with a fixed maturity no longer than 270 days. Usually sold in discount form.

COUPON: (a). The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value. (b) A certificate attached to a bond evidencing interest due on a payment date.

DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account.

DELIVERY VERSUS PAYMENT (DVP): There are two methods of delivery of securities:
delivery versus payment and delivery versus receipt (also called free). Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities.

DEBENTURE: A bond secured only by the general credit of the issuer.

DERIVATIVES: (1) Financial instruments whose return profile is linked to, or derived from, the movement of one or more underlying indices or securities, and may include a leveraging factor, or (2) financial contracts based on notional amounts whose value is derived from an underlying index or security (interest rates, foreign exchange rates, equities, or commodities).

DISCOUNT: The difference between the cost price of a security and its value at maturity when quoted at lower than face value. A security selling below original offering price shortly after sale also is considered to be at a discount.

DISCOUNT SECURITIES: Non-interest-bearing money market instruments that are issued at a discount and redeemed at maturity for full face value (e.g., U.S. Treasury bills, commercial paper, Agency discount notes).

DIVERSIFICATION: Dividing investment funds among a variety of securities, issuers, and maturity dates offering independent returns.

DURATION: A measure of the timing of the cash flows, such as the interest payments and the principal repayment, to be received from a given fixed-income security. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity.

The duration of a security is a useful indicator of its price volatility for given changes in interest rates.

FEDERAL AGRICULTURAL MORTGAGE CORPORATION (FARMER MAC): Farmer Mac was created to increase access to and reduce the cost of capital for the benefit of American agriculture and rural communities. Farmer Mac provides financial solutions to a broad spectrum of the agricultural community, including agricultural lenders, agribusinesses, and other institutions.

FEDERAL CREDIT AGENCIES: Agencies of the Federal government set up to supply

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Packet Pg. 261 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) C-3
credit to various classes of institutions and individuals, e.g., S&L's, small business firms, students, farmers, farm cooperatives, and exporters.

FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A federal agency that insures bank deposits, currently up to $250,000 per deposit.

FEDERAL FARM CREDIT BANKS FUNDING CORPORATION (FFCB): The Federal Farm Credit Banks Funding Corporation is a leading provider of loans, leases and services to rural communities and U.S. agriculture.

FEDERAL FUNDS: Non-interest-bearing deposits held by member banks at the Federal Reserve. Also used to denote "immediately available" funds in the clearing sense. "Fed Funds" also used to refer to these funds.

FEDERAL FUNDS RATE: The rate of interest at which private banks lend funds to other private banks. The Federal Open Market Committee (FOMC) sets a target rate. This actual rate is currently pegged by the Federal Reserve through open-market operations.

FEDERAL HOME LOAN BANKS (FHLB): Government sponsored wholesale banks (currently 12 regional banks) which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions, and insurance companies. The mission of the FHLB’s is to liquefy the housing related assets of members who must purchase stock in their district Bank.

FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC): A Government Sponsored Enterprise that provides liquidity to the mortgage markets, much like FNMA and FHLB. Also referred to as “Freddie Mac”.

FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA): FNMA, like GNMA was chartered under the Federal National Mortgage Association Act in 1938. FNMA is a federal corporation working under the auspices of the Department of Housing & Urban Development, H.U.D. It is the largest single provider of residential mortgage funds in the United States. Fannie Mae, as the corporation is called, is a private stockholder-owned corporation. The corporation’s purchases include a variety of adjustable mortgages and second loans in addition to fixed-rate mortgages. FNMA's securities are also highly liquid and are widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest.

FEDERAL OPEN MARKET COMMITTEE (FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.

FEDERAL RESERVE SYSTEM: The central bank of the United States created by Congress and consisting of a seven-member Board of Governors in Washington, D.C., 12 Regional Banks, and about 5,700 commercial banks that are members of the system.

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Packet Pg. 262 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) C-4
GOVERNMENTAL NATIONAL MORTGAGE ASSOCIATION (GNMA or Ginnie Mae):

Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations and other institutions. Security holder is protected by full faith and credit of the U.S. Government.

Ginnie Mae securities are backed by FHA, VA or FMHM mortgages. The term passthroughs is often used to describe Ginnie Maes.

GREEN BONDS: Green bonds are used to finance projects that promote environmental and/or climate benefits. Green bonds eligible for inclusion in the City’s investment portfolio are issued by government agencies, private corporations, and institutions such as the World Bank.

INVERSE FLOATERS: A structured note in which the coupon increase as interest rates decline and decrease as rates rise.

LIQUIDITY: Liquidity is the ability to change an investment into its cash equivalent on short notice at its prevailing market value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes.

LOCAL AGENCY INVESTMENT FUND (LAIF): The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment and reinvestment.

MARKET VALUE: The price at which a security is trading and could presumably be purchased or sold.

MASTER REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase-reverse repurchase agreements that establishes each party's rights in the transactions. A master agreement will often specify, among other things, the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller-borrower.

MATURITY: The date upon which the principal or stated value of an investment becomes due and payable.

MONEY MARKET: The market in which short-term debt instruments (bills, commercial paper, bankers' acceptances, etc.) are issued and traded.

OFFER: The price asked by a seller of securities (When you are buying securities, you ask for an offer). See ASKED AND BID.

OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank, as directed by the FOMC, in order to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit; sales have the opposite effect. Open market operations are the Federal Reserve's most important and most flexible monetary policy tool.

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PORTFOLIO: Collection of securities held by an investor.

PRIMARY DEALERS: A group of government securities dealers that submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) registered securities broker-dealers, banks, and a few unregulated firms.

PRIME RATE: The rate at which banks lend to their best or "prime" customers.

PRINCIPAL: 1) the dollar cost of an issue excluding accrued interest. 2) The one who takes ownership in a transaction, as opposed to brokering or acting as agent.

PRUDENT PERSON RULE: An investment standard. In some states the law requires that a fiduciary, such as a trustee, may invest money only in a list of securities selected by the state (the so-called legal list). In other states, the trustee may invest in a security if it is one, which would be brought by a prudent person of discretion and intelligence who is seeking a reasonable income and preservation of capital.

QUALIFIED PUBLIC DEPOSITORIES: A financial institution which does not claim exemption from the payment of any sales or compensating use or ad valorem taxes under the laws of this state, which has segregated for the benefit of the commission eligible collateral having a value of not less than its maximum liability and which has been approved by the Public Deposit Protection Commission to hold public deposits.

RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond or the current income return.

REPURCHASE AGREEMENT (RP OR REPO): A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed price on a fixed date. The security "buyer" in effect lends the "seller" money for the period of the agreement, and the terms of the agreement are structured to compensate him for this.

Dealers use RP extensively to finance their positions. Exception: When the Fed is said to be doing RP, it is lending money that is increasing bank reserves.

REVERSE REPO: An agreement whereby the dealer agrees to buy securities and the investor agrees to repurchase them at a later date.

SAFEKEEPING: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank's vaults for protection.

SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution.

SEC RULE 15C3-1: See uniform net capital rule.

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Packet Pg. 264 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) C-6
SECURITIES AND EXCHANGE COMMISSION: Agency created by Congress to protect investors in securities transaction by administering securities legislation.

SOCIAL IMPACT BONDS: Social impact bonds are used to finance programs such as affordable housing, poverty reduction, or other positive sustainable and social outcomes.

Social impact bonds eligible for inclusion in the City’s investment portfolio are typically issued by government agencies, and institutions such as the World Bank.

STRUCTURED NOTES: Notes issued by Government Sponsored Enterprises (FHLB, FNMA, etc.) and Corporations which have embedded options (e.g. call features, step-up coupons, floating rate coupons, derivative based returns) into their debt structure. Their market performance is impacted by the fluctuation of interest rates, the volatility of the imbedded options, and shifts in the shape of the yield curve.

SETTLEMENT DATE: The date on which a trade is cleared by delivery of securities against funds. This date may be the same as the trade date or later.

SUPRA NATIONALS: For purposes of this investment policy - obligations issued by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank.

TRADE DATE: The date on which the buyer and seller agree to a transaction. The trade date may or may not be the date on which the securities and money changes hands (settlement date).

TREASURY BILLS: A non-interest-bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months, or one year.

TREASURY BOND: Long-term coupon-bearing securities U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities of more than ten years.

TREASURY NOTES: Intermediate term coupon-bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities of from one to ten years.

UNIFORM CAPITAL RULE: Securities and Exchange Commission requirement that member firms as well as non-member broker-dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash.

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Packet Pg. 265 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) C-7
YIELD: The rate of annual income return on an investment, expressed as a percentage. (a) INCOME YIELD is obtained by dividing the current dollar income by the current market price for the security. (b) NET YIELD or YIELD TO MATURITY is the current income yield minus any premium above par or plus any discount from par in purchase price with the adjustment spread over the period from the date of purchase to the date of maturity of the bond.

YIELD TO MATURITY: The rate of return yielded by a debt security held to maturity when both interest payments and the investor's capital gain or loss on the security are taken into account.

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Packet Pg. 266 Attachment: Annual Update on City Investment Policy-Final REVISED 2022 (5566 : Annual Investment Policy Update) 1 Revised 2/2023
ATTACHMENT 1

INVESTMENT POLICY FOR THE CITY OF SANTA MONICA

1. POLICY
It is the policy of the City of Santa Monica (City) to invest public funds in a manner which will safely preserve portfolio principal, provide adequate liquidity to meet the City’s cash flow needs, and optimize returns while conforming to all federal, state, and local statutes governing the investment of public funds. Should any applicable provisions of these statutes change from those included herein, such provision shall be considered incorporated in the policy. The policy should be submitted to the City Council annually for review and approval.

2. SCOPE
This investment policy applies to all cash and financial investments of the various funds of the City of Santa Monica as identified in the City's Annual Financial Report, with the exception of those financial assets explicitly excluded from coverage by the Investment Policy for legal or operational reasons. Cemetery and Mausoleum Perpetual Care Funds are private funds held in trust and managed by the City.

These funds do not fall under the guidelines of the Government Code sections noted in Section 8.0 of this Policy but are invested by an outside investment manager under guidelines established by the City Council.

All City funds are listed in Attachment 1-A. The Investment Policy will also apply to all new funds created unless specifically exempted.

Except as otherwise noted, City funds are pooled for investment purposes.

Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

Interest is allocated on a quarterly basis.

3. PRUDENCE
All investments and evaluation of investments shall be made with the Prudent Investor Standard as set forth in California Government Code Section 53600.3.

Investments shall be made with judgment and care, under circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency.

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Packet Pg. 267 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 2 The standard of prudence shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and the investment policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments.

4. INVESTMENT OBJECTIVES
The primary objective of all City investments, in priority order, shall be:

4.1 SAFETY
Safety of principal is the foremost objective of the investment program. City investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this, the City will diversify its investments by investing funds in securities of various types and maturity dates, and from various issuers offering independent returns.

4.2 LIQUIDITY
Liquidity is the ability to change an investment into its cash equivalent on short notice at its prevailing market value. The City’s investment portfolio shall remain sufficiently liquid to enable the City to meet all operating requirements which might be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrently with anticipated cash needs.

Since all possible cash demands cannot be anticipated, the portfolio will maintain a liquidity “buffer” and invest primarily in securities with active secondary or resale markets.

4.3 RATE OF RETURN
The City’s investment portfolio shall be designed with the objective of attaining a benchmark rate of return throughout budgetary and economic cycles, taking into account safety and liquidity requirements. The benchmark may vary from time to time depending on the economic and budgetary conditions present. At no time shall funds be invested in any security that could result in zero interest accrual if held to maturity except as specified in Section 8.2 of this policy.

5. INVESTMENT AUTHORITY DELEGATION
In accordance with the Santa Monica City Charter, Section 711, the City Council delegates to the City Treasurer the authority to invest City funds. The Director of Finance, as City Treasurer, delegates this authority to the Assistant City Treasurer.

In the absence of the Director of Finance and the Assistant City Treasurer, the Treasury Administrator or the Senior Treasury Analyst may execute investment transactions per instructions from the Director of Finance and/or Assistant City

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Packet Pg. 268 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 3 Treasurer or per prior written authorization. Section 53607 of the State of California Government Code limits the authorization of the legislative body to delegate investment authority to a one- year period, renewable annually.

5.1 INVESTMENT PROCEDURES
The Director of Finance is responsible for conducting and reporting on all City investments. To facilitate this function, the Director of Finance or their designee will prepare and maintain an Investment Procedures Manual detailing procedure for the operation of the investment program consistent with this policy. The manual should include reference to safekeeping, banking services contracts, collateral/depository agreements, and repurchase agreements. The manual shall also include explicit delegation of authority to persons responsible for investment transactions. No person may engage in investment transactions except as provided under the terms of this policy and the procedures established by the Director of Finance. Additionally, the manual will explicitly include a current listing of all City of Santa Monica financial institution deposit and investment accounts, a current copy of or link to State laws pertinent to City investments, a description of specific controls to ensure the proper execution of the City Investment Policy, and copies, with instructions, of all investment reports required by law or by City Investment Policy.

5.2 INVESTMENT COMMITTEE
An Investment Committee (the Committee) shall be established consisting of the City Manager, the Assistant City Manager, the Director of Finance, the Assistant City Treasurer, one other department head serving one-year terms on a rotating basis, and one qualified citizen representative, appointed by the City Manager for a one-year term, who possesses strong skills and knowledge in the areas of finance and economics. The one-year terms for the citizen representative and the department head may be extended at the discretion of the City Manager. The purpose of the Committee is to provide general oversight and act in an advisory capacity. The Committee will attempt to meet once each calendar quarter to review and evaluate previous investment activity, to review the current status of all funds held by the City, to discuss anticipated cash requirements and investment activity for the next quarter, and to discuss investment strategy.

6. ETHICS AND CONFLICTS OF INTEREST
The Director of Finance and other employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. The Director of Finance and other employees involved in the investment process shall disclose any material interests in financial institutions with which they conduct business within their jurisdiction, and they shall further disclose any material personal financial/investment positions that could be related to the

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Packet Pg. 269 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 4 performance of the City’s investment portfolio and shall refrain from personal investment transactions with the same individual or firm with whom business is conducted on behalf of the City.

The Director of Finance and other employees involved in the investment process are required to file annual disclosure statements as required by the Fair Political Practices Commission. During the course of the year, if there is an event subject to disclosure that could impair the ability of the Director of Finance or investment employees to make impartial decisions, the City Council will be notified in writing within ten (10) days of the event.

7. AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS
The City shall transact business only with issuers, banks, savings and loans, and registered securities dealers. The purchase of any investment, other than those purchased directly from the issuer, shall be purchased from either an institution licensed by the State as a broker/dealer as defined in Section 25004 of the Corporation Code, who is a member of FINRA (Financial Industry Regulatory Authority), or a member of a federally regulated securities exchange, a national or state chartered bank, a federal or state association (as defined by Section 5102 of the Financial Code), or a brokerage firm designated as a primary dealer by the Federal Reserve Bank.

The Director of Finance’s staff shall periodically conduct a “Request for Qualifications” process to investigate broker/dealers that wish to do business with the City. All institutions that desire to become a broker/dealer for the City must complete the City’s “Broker/Dealer Request for Information” and “Broker/Dealer Certification”. Staff will evaluate broker dealers based on the qualifications of the firm and the individual broker(s) assigned to the City. The evaluation will be based on experience of the broker in servicing public fund investment portfolios, market capitalization of the firm, the brokers’ ability to access markets in securities appropriate to the City’s needs, and the brokers’ agreement to abide by the City’s Investment Policy. Selection as an approved broker/dealer does not guarantee that the firm will conduct any investment transactions with the City The Director of Finance shall conduct periodic reviews of the financial condition and other qualifications of all approved financial institutions and broker/dealers to determine if they continue to meet the City’s guidelines for qualification as defined in this section. Additionally, the City shall keep the current audited financial statements on file for each approved financial institution and broker/dealer with which the City conducts investment transactions. A listing of websites where these financial statements may be viewed may substitute for physical hard copies of the statements.

8. AUTHORIZED AND SUITABLE INVESTMENTS
Investments shall be made only in those instruments specifically authorized by California State laws, primarily Sections 53601, 53601.6, 53601.8, 16429.1, and

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Packet Pg. 270 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 5 53684 et seq. of the Government Code and to no greater an extent than authorized by those laws. These laws are summarized in Attachment 1-B.

Additional City guidelines are as follows:

Instruments Additional City Guidelines
U.S. Federal Agencies No more than 50% of portfolio, per agency Banker's Acceptances (BA) Maximum of 10% of portfolio per issuer Negotiable Certificates of Deposit Maximum of 10% of portfolio per issuer (NCD)
Commercial Paper (CP) Maximum of 25% of portfolio
It is recognized that legal or other events may occur that could require exceptions to certain guidelines. The percentages listed in the above guidelines are based on book value of the portfolio at the time of purchase.

In addition to following all legal guidelines, the portfolio will preserve principal, maintain adequate liquidity to meet all City obligations, contain an appropriate level of interest rate risk, and be diversified across types of investments, maturities, and institutions to minimize credit risk and maintain an appropriate return.

8.1 REPURCHASE AGREEMENTS
Investments in repurchase agreements are allowable and shall be made only with financial institutions with which the City has an executed master repurchase agreement. The financial institution must be a primary dealer of the Federal Reserve Bank of New York.

8.2 PROHIBITED INVESTMENTS AND TRANSACTIONS
a) Prohibited investments include inverse floaters, range notes, interest only strips derived from a pool of mortgages (collateralized mortgage obligations), and any security that could result in zero interest accrual if held to maturity, as specified in Section 53601.6.
b) Notwithstanding the prohibition in paragraph (a), the City may invest in securities issued by, or backed by, the United States government that could result in zero- or negative-interest accrual if held to maturity, in the event of, and for the duration of, a period of negative market interest rates.

This shall remain in effect only until January 1, 2026.

8.3 INVESTMENTS HELD AND/OR MANAGED BY FISCAL AGENTS

A N D TRUSTEES
In addition, the main pooled portfolio, the City may hold and invest certain other funds that are restricted as to use. One example is bond proceeds held by fiscal agents. Investments of bond or loan proceeds will be made in accordance with Government Code Section 53601 (m), which states that money from bond proceeds should be invested as specified by bond documents, and in accordance with specific bond covenants. In most cases

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Packet Pg. 271 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 6 these investments will be made under the same guidelines as other City investments. Another example is funds received from legal settlements that are restricted for a certain purpose, which will be invested in accordance with legal or escrow agreements that may be more restrictive than the City’s Investment Policy.

As noted previously in this Policy, Cemetery and Mausoleum Perpetual Care Funds are private funds held in trust by the City. These funds are invested by an outside investment manager under guidelines adopted by the City Council and do not fall under the guidelines of the Government Code sections noted in Section 8.0 of this Policy. The Director of Finance’s staff monitors all investment activity of these funds to ensure guidelines are followed.

9. INVESTMENT POOLS/MUTUAL FUNDS
A thorough investigation of any pooled investment funds, including mutual funds, is required prior to investing, and on a continual basis. To accomplish this, a questionnaire will be used to evaluate the suitability of the pooled fund. The questionnaire will answer the following general questions:
• A description of eligible investment securities, and a written statement of investment policies and objectives.
• A description of interest calculations and how it is distributed, and how gains and losses are treated.
• A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited. • A description of who may invest in the program, how often, and what size deposit and withdrawal are allowed.
• A schedule for receiving statements and portfolio listings. • Are reserves, retained earnings, etc., utilized by the pool/fund? • A fee schedule, and when and how fees are assessed.
• Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds? For mutual funds, a fund prospectus can substitute for the questionnaire.

10. COLLATERALIZATION
California Government Code Sections 53652, et seq. requires depositories to post certain types of collateral for public funds above the Federal Deposit Insurance Corporation (FDIC) insurance amounts. The collateral requirements apply to bank deposits, both active (checking and savings accounts) and inactive (non-negotiable certificates of deposit).

Collateralization is also required for repurchase agreements. In order to anticipate market changes and provide a level of security for all funds, the collateralization level

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Packet Pg. 272 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 7 will be 102% of the market value of principal and accrued interest, and the value shall be adjusted no less than quarterly. Collateral will be in the form of U.S.

Treasury Obligations or U.S. Agency Securities.

Collateral will always be held by an independent third party with whom the entity has a current custodial arrangement. A clearly marked evidence of ownership (safekeeping receipt) must be available to be supplied to the City, if requested, and retained. The right of collateral substitution is granted.

11. SAFEKEEPING AND CUSTODY
In accordance with California Government Code Section 53601, all securities owned by the City shall be held in safekeeping by the City’s custodial bank or a third-party bank trust department, acting as an agent for the City under terms of the custody agreement. Collateral for repurchase agreements will be held by a third-party custodian under terms of the Master Repurchase Agreement.

All securities will be received and delivered using a delivery vs. payment (DVP) basis, which ensures that securities are deposited with the third-party custodian prior to the release of funds. Securities held by the third-party custodian will be evidenced by safekeeping receipts and/or bank statements. Investments in the State Local Agency Investment Fund (LAIF) or money market mutual funds are undeliverable and are not subject to delivery or third-party safekeeping.

Investment trades shall be verified against bank transactions and broker confirmation tickets. On a monthly basis, the custodial asset statement shall be reconciled with the month-end portfolio holdings.

12. DIVERSIFICATION
The City will diversify its investments by security type, institution, and maturity date.

Concentration limits are set by the State Government Code (see Attachment B) and Section 8.0 (Authorized and Suitable Investments) of this policy.

13. MAXIMUM MATURITIES
To the extent possible, the City will attempt to match its investments with anticipated cash flow requirements. Most investments will be made in securities with a term remaining to maturity of five years or less. However, on February 22, 2022, the City Council granted authority to invest in securities with a remaining term in excess of five years as part of the City’s overall investment program. Per that authorization, up to 15% of the portfolio value may be invested in U.S. government or Federal Agency securities with remaining maturities at the time of purchase between five and fifteen years. Per State law, the settlement date of the investment purchase is considered the start date of the remaining term to maturity. Further maturity limitations

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Packet Pg. 273 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 8 per State Code are shown in Attachment B. The weighted average maturity of the investment portfolio should be three years or less.

In order to minimize the impact of market risk, most investments will be purchased with the intent to hold to maturity. Investments may be sold prior to maturity for cash flow needs, portfolio rebalancing and/or appreciation purposes, or in order to mitigate portfolio risk by limiting potential losses. However, no investment shall be made based solely on earnings anticipated from capital gains. Due to the uncertain nature of cash flow requirements, a portion of the portfolio should be continually invested in readily available funds.

14. INTERNAL CONTROLS
The Director of Finance shall be responsible for ensuring that all investment transactions comply with the City’s Investment Policy and for establishing internal controls that are designed to prevent losses due to fraud, negligence, and third-party misrepresentation.

The Director of Finance will also establish internal control procedures addressing wire transfer controls, separation of duties and administrative controls, avoidance of collusion, separation of transaction authority from accounting procedures, documentation of investment transactions, and monitoring of results.

As part of its annual audit of the City, the City’s external auditor will review compliance with statutes, policies, and procedures.

15. PERFORMANCE STANDARDS
The portfolio shall be designed with the objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with investment risk constraints and cash flow needs.

15.1 MARKET YIELD (Benchmark)
The City’s overall investment strategy is passive. Given this strategy, the basis used by the Director of Finance to determine whether appropriate and suitable market yields are being achieved shall be to identify a comparable benchmark to the portfolio’s investment duration, e.g., the Constant Maturing Two Year Treasury bill index. Benchmarks may change over time depending on the portfolio’s duration.

16. REPORTING
In accordance with State law and the City Charter, monthly reports will be made to the City Council and the City Manager describing the present status of City

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Packet Pg. 274 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 9 investments and monies held by the City, as well as summarizing all investment transactions for the month. Schedules in the monthly report should include the following:
• A complete list of investments including the type of the investment, name of the issuer, maturity date, par value, book value, and market value • The source of market value data
• The weighted average maturity and yield to maturity of the portfolio • Coupon, discount, or earnings rate for each security
• Percentage of portfolio represented by each investment category • A certification of compliance with the Investment Policy • A statement denoting the City’s ability to meet its anticipated expenditures requirements for the next six months
• Benchmark comparison
Records of all investment transactions will be kept and filed in the Finance Department in accordance with legal guidelines and records retention policies.

17. SOCIALLY RESPONSIBLE INVESTING
RESTRICTIONS – The direct investment of City funds are restricted as follows:
a. Investments should be made in entities that support clean and healthy environment, including following safe and environmentally sound practices. b. No investments will be made in fossil fuel companies as defined by “The Carbon Underground 200” list maintained and published by the organization FFI Solutions or in banking institutions that provide financing to said companies. c. No investments are to be made in tobacco or tobacco-related products. d. No investments are to be made to support the production of weapons, military systems, or nuclear power.
e. Investments should be made in entities that support equality of rights regardless of sex, race, age, disability or sexual orientation.
f. Investments should be made in entities that promote community economic development.

Funds invested with a trustee and/or outside investment managers such as the Cemetery and Mausoleum Perpetual Care Funds will comply with this section of the policy.

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Packet Pg. 275 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) 10 18. COMMUNITY REINVESTMENT ACT (CRA)
The City will deposit funds only in those financial institutions, which have a CRA rating (as determined by the appropriate regulatory body) of "Outstanding" or "Satisfactory".

19. INVESTMENT POLICY ADOPTION
The City’s investment policy shall be reviewed and adopted by the City Council annually. The Investment Committee will review the policy periodically to ensure its consistency with the overall objectives of preservation of principal, liquidity, and return, and its conformance with current law, financial and economic trends, and cash flow needs of the City.

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Packet Pg. 276 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) A-1
ATTACHMENT 1-A
City of Santa Monica Funds for Cash Pooling
The following listed City of Santa Monica funds shall have their cash balances pooled for investment purposes.

FUND

NUMBER FUND NAME
1 GENERAL FUND
10 SPECIAL REVENUE SOURCE FUND
11 BEACH RECREATION FUND
12 HOUSING AUTHORITY FUND
14 TENANT OWNERSHIP RIGHTS CHARTER AMENDMENT
16 CLEAN BEACHES AND OCEAN PARK PARCEL TAX FUND
17 TRAFFIC SAFETY FUND
18 SCAQMD AB2766 FUND
19 COMMUNITY DEVELOPMENT BLOCK GRANT (CBDG) FUND
20 MISCELLANEOUS GRANTS FUND
21 ASSET SEIZURE FUND
22 CITIZENS OPTION FOR PUBLIC SAFETY FUND
25 RENT CONTROL FUND
26 GAS TAX FUND
27 LOCAL RETURN FUND
28 PARKS AND RECREATION FACILITIES FUND
41 LOW/MODERATE INCOME HOUSING ASSET FUND
50 WATER FUND
51 WASTEWATER FUND
52 STORMWATER MANAGEMENT FUND
53 PIER FUND
54 RESOURCE RECOVERY & RECYCLING FUND
55 COMMUNITY BROADBAND FUND
57 AIRPORT FUND
59 CEMETERY FUND
60 BIG BLUE BUS FUND
61 PARKING AUTHORITY FUND
70 VEHICLE MANAGEMENT FUND
71 INFORMATION TECHNOLOGY REPLACEMENT & SERVICES FUND
72 SELF INSURANCE-GENERAL LIAB/AUTO FUND
73 SELF INSURANCE-BUS FUND
74 SELF INSURANCE WORKERS-COMPENSATION FUND
75 SELF INSURANCE-ADMIN FUND
80 GENERAL TRUST FUND
81 CEMETERY PERPETUAL CARE FUND
82 MAUSOLEUM ENDOWMENT FUND

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Packet Pg. 277 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) B-1
ATTACHMENT 1-B
Summary of State of California Statutes Applicable to Municipal Investments The following investments are authorized by California State Code, Title 5, Division 2, and Sections 53600, 53601, 53631.5 and 53635. See code sections for complete descriptions.

Authorized Investment Legal Limit
(%)
Other Constraints
Local Agency Bonds No limit Maximum maturity 5 years.

U.S. Treasury Obligations No limit Maximum maturity 5 years except as noted below.****
State Obligations -
California and Others
No limit Maximum maturity 5 years.

California Local Agency
Obligations
No limit Maximum maturity 5 years.

U.S. Agency Obligations No limit Maximum maturity 5 years except as noted below.****
Bankers’ Acceptance 40% Eligible for purchase by the Federal Reserve System and not to exceed 180
days to maturity. No more than 30% may
be in bankers' acceptances of any one
commercial bank.

Commercial Paper – Non
Pooled Funds
40% "A -1 /P - 1/F - 1" rating; if the issuer has
long-term debt, it must rated “A”; U.S.
corporate assets over $500,000,000;
purchases may not represent more than
10% of outstanding commercial paper
and medium-term notes. Commercial
paper may not exceed 270 days to
maturity.***
Commercial Paper –
Pooled Fund
40% "A -1 /P - 1/F - 1" rating; if the issuer has
long-term debt, it must rated “A”; U.S.
corporate assets over $500,000,000;
purchases may not represent more than
10% of outstanding paper and may not
exceed 270 days to maturity.

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Packet Pg. 278 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) B-2
Authorized Investment Legal Limit
(%)
Other Constraints
Negotiable Certificates of
Deposit
30% Maximum maturity 5 years. State and
Federally chartered banks and savings
institutions, including U.S. branches of
foreign banks regulated by State
regulatory authorities (“Yankee CD”).

Deposit/CD Placement
Services
50%** Maximum maturity 5 years. Deposits with
any one private sector placement service
are limited to 50% of the portfolio. This
limit does not apply to placement serviceassisted CD’s.

Repurchase Agreement No limit Maximum maturity 1 year. Securities used as collateral for repo's must be
investments allowable under Govt. Code
(i.e., T-bills, Agencies, BAs, CDs, etc.);
must be collateralized at 102% of market
value or greater; securities must be safe
kept by third party.

Reverse Repurchase
Agreements/Securities
Lending Agreements
20% Must be made with primary dealers of the
Federal Reserve Bank of New York and
the securities used for the agreement
must have been held by the local agency
for at least 30 days. The maximum
maturity is 92 days.

Medium-Term Corporate
Notes
30% Maximum maturity 5 years; bonds must
be rated minimum of “A” by a nationally
recognized rating service.

Mutual Funds and Money
Market Mutual Funds
20% No more than 10% may be invested in
any one mutual fund. Funds are
invested in securities and obligations
authorized by sub- divisions (a) through
(m) of Section 53601 and
53635, (any of the authorized
investments for local agencies) the
investment company must be in highest
ranking provided by not less than two of
the three largest nationally recognized
rating services OR must have the
investment advisor registered with the
SEC with no less than 5 yrs. experience
and have assets under mgmt. in excess
of $500 million.

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Packet Pg. 279 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) B-3
Authorized Investment Legal Limit
(%)
Other Constraints
Supra Nationals
(International Bank for
Reconstruction and
Development.

International Finance
Corporation, InterAmerican Development
Bank
30% Maximum maturity 5 years. Must be
rated AA or better by a nationally
recognized rating service. Must be
senior unsubordinated obligations
denominated in U.S. Dollars.

Money Market Funds 20% The money market funds must have an average weighted maturity of 90 days or
less and abide by SEC regulations;
funds must receive the highest ranking
by 2 of the 3 largest nationally
recognized rating agencies OR retain an
investment advisor who is registered, or
exempt from registration, with the SEC
and has at least 5 years’ experience
managing money market funds in
excess of $500 million.

Collateralized Certificate
of Deposit
No limit Maximum maturity 5 years. Banks:
deposit not to exceed the total of paid-in
capital surplus. S&Ls: deposit not to
exceed the greater of total net worth or
$500,000. State and Federal credit
unions: deposit shall not exceed the
greater of the total of unpaired capital and
surplus or $500,000. Must be
collateralized to 110% of the CD value by
other eligible securities. Investments in
certificates of deposits of state or federal
credit unions if any member of the city’s
governing or managing officers (council,
city manager, fiscal officers) serves on
the credit union board or key committee
positions is prohibited.

Mortgage Pass-Through 20% Maximum remaining maturity of 5 years; bonds must be rated in top two rating
categories by a nationally recognized
rating service. Shall not exceed 95% of
the mortgage security's fair market value.

Bank/Time Deposits No limit Maximum maturity of 5 years.

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Packet Pg. 280 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) B-4
Authorized Investment Legal Limit
(%)
Other Constraints
Local Agency Investment
Fund (LAIF)
$ 75 million* Monies are invested in pooled state fund
managed by State Treasurer. Maximum
15 transactions per month.

Joint Powers Authority
Pool
No limit
County Pooled
Investment Funds
No limit
Public Bank No limit Commercial paper, debt securities, or other obligations of a public bank, as
defined in Section 57600.
* Per LAIF account. Separate accounts can be established for different legal entities. ** Per AB 945, limit increased from 30% to 50% effective January 1, 2020 until January 1, 2026, at which time limit will return to 30%.
*** In effect until January 1, 2026.
**** Per Council authorization, up to 15% of the portfolio may be invested in remaining term to maturity of over five and up to fifteen years.

Bond Proceeds
Bond proceeds may be invested in accordance with the State Code and bond indenture provisions.

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Packet Pg. 281 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) C-1
ATTACHMENT 1-C

GLOSSARY
AGENCIES: Federal agency securities and/or Government Sponsored Enterprises (GSE’s).

ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR): The official annual report for the City of Santa Monica. It includes basic financial statements for each individual fund and account group prepared in conformity with GAAP. It also includes supporting schedules necessary to demonstrate compliance with finance-related legal and contractual provisions, extensive introductory material, and a detailed Statistical Section.

ASKED: The price at which securities are offered for sale.

BANKERS’ ACCEPTANCE (BA): A draft or bill of exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer.

BASIS POINT: A basis point equals one one-hundredth of 1% (.01%).

BENCHMARK: A comparative base for measuring the performance or risk tolerance of an investment portfolio. The benchmark should represent a close correlation to the level of risk and the average duration of the portfolio.

BID: The price offered for securities.

BROKER: A broker brings buyers and sellers together for a commission.

CALLABLE SECURITY: A security that can be redeemed by the issuer before the scheduled maturity date.

CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a certificate. Large denomination CD’s are typically negotiable.

COLLATERAL: Securities, evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.

COMMERCIAL PAPER (CP): An unsecured promissory note with a fixed maturity no longer than 270 days. Usually sold in discount form.

COUPON: (a). The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value. (b) A certificate attached to a bond evidencing interest due on a payment date.

DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying

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and selling for his own account.

DELIVERY VERSUS PAYMENT (DVP): There are two methods of delivery of securities:
delivery versus payment and delivery versus receipt (also called free). Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities.

DEBENTURE: A bond secured only by the general credit of the issuer.

DERIVATIVES: (1) Financial instruments whose return profile is linked to, or derived from, the movement of one or more underlying indices or securities, and may include a leveraging factor, or (2) financial contracts based on notional amounts whose value is derived from an underlying index or security (interest rates, foreign exchange rates, equities, or commodities).

DISCOUNT: The difference between the cost price of a security and its value at maturity when quoted at lower than face value. A security selling below original offering price shortly after sale also is considered to be at a discount.

DISCOUNT SECURITIES: Non-interest-bearing money market instruments that are issued at a discount and redeemed at maturity for full face value (e.g., U.S. Treasury bills, commercial paper, Agency discount notes).

DIVERSIFICATION: Dividing investment funds among a variety of securities, issuers, and maturity dates offering independent returns.

DURATION: A measure of the timing of the cash flows, such as the interest payments and the principal repayment, to be received from a given fixed-income security. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity.

The duration of a security is a useful indicator of its price volatility for given changes in interest rates.

FEDERAL AGRICULTURAL MORTGAGE CORPORATION (FARMER MAC): Farmer Mac was created to increase access to and reduce the cost of capital for the benefit of American agriculture and rural communities. Farmer Mac provides financial solutions to a broad spectrum of the agricultural community, including agricultural lenders, agribusinesses, and other institutions.

FEDERAL CREDIT AGENCIES: Agencies of the Federal government set up to supply credit to various classes of institutions and individuals, e.g., S&L's, small business firms, students, farmers, farm cooperatives, and exporters.

FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A federal agency that insures bank deposits, currently up to $250,000 per deposit.

FEDERAL FARM CREDIT BANKS FUNDING CORPORATION (FFCB): The Federal Farm Credit Banks Funding Corporation is a leading provider of loans, leases and services

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to rural communities and U.S. agriculture.

FEDERAL FUNDS: Non-interest-bearing deposits held by member banks at the Federal Reserve. Also used to denote "immediately available" funds in the clearing sense. "Fed Funds" also used to refer to these funds.

FEDERAL FUNDS RATE: The rate of interest at which private banks lend funds to other private banks. The Federal Open Market Committee (FOMC) sets a target rate. This actual rate is currently pegged by the Federal Reserve through open-market operations.

FEDERAL HOME LOAN BANKS (FHLB): Government sponsored wholesale banks (currently 12 regional banks) which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions, and insurance companies. The mission of the FHLB’s is to liquefy the housing related assets of members who must purchase stock in their district Bank.

FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC): A Government Sponsored Enterprise that provides liquidity to the mortgage markets, much like FNMA and FHLB. Also referred to as “Freddie Mac”.

FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA): FNMA, like GNMA was chartered under the Federal National Mortgage Association Act in 1938. FNMA is a federal corporation working under the auspices of the Department of Housing & Urban Development, H.U.D. It is the largest single provider of residential mortgage funds in the United States. Fannie Mae, as the corporation is called, is a private stockholder-owned corporation. The corporation’s purchases include a variety of adjustable mortgages and second loans in addition to fixed-rate mortgages. FNMA's securities are also highly liquid and are widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest.

FEDERAL OPEN MARKET COMMITTEE (FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.

FEDERAL RESERVE SYSTEM: The central bank of the United States created by Congress and consisting of a seven-member Board of Governors in Washington, D.C., 12 Regional Banks, and about 5,700 commercial banks that are members of the system.

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GOVERNMENTAL NATIONAL MORTGAGE ASSOCIATION (GNMA or Ginnie Mae):

Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations and other institutions. Security holder is protected by full faith and credit of the U.S. Government.

Ginnie Mae securities are backed by FHA, VA or FMHM mortgages. The term passthroughs is often used to describe Ginnie Maes.

GREEN BONDS: Green bonds are used to finance projects that promote environmental and/or climate benefits. Green bonds eligible for inclusion in the City’s investment portfolio are issued by government agencies, private corporations, and institutions such as the World Bank.

INVERSE FLOATERS: A structured note in which the coupon increase as interest rates decline and decrease as rates rise.

LIQUIDITY: Liquidity is the ability to change an investment into its cash equivalent on short notice at its prevailing market value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes.

LOCAL AGENCY INVESTMENT FUND (LAIF): The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment and reinvestment.

MARKET VALUE: The price at which a security is trading and could presumably be purchased or sold.

MASTER REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase-reverse repurchase agreements that establishes each party's rights in the transactions. A master agreement will often specify, among other things, the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller-borrower.

MATURITY: The date upon which the principal or stated value of an investment becomes due and payable.

MONEY MARKET: The market in which short-term debt instruments (bills, commercial paper, bankers' acceptances, etc.) are issued and traded.

OFFER: The price asked by a seller of securities (When you are buying securities, you ask for an offer). See ASKED AND BID.

OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank, as directed by the FOMC, in order to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit; sales have the opposite effect. Open market operations are the Federal Reserve's most important and most flexible monetary policy tool.

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PORTFOLIO: Collection of securities held by an investor.

PRIMARY DEALERS: A group of government securities dealers that submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) registered securities broker-dealers, banks, and a few unregulated firms.

PRIME RATE: The rate at which banks lend to their best or "prime" customers.

PRINCIPAL: 1) the dollar cost of an issue excluding accrued interest. 2) The one who takes ownership in a transaction, as opposed to brokering or acting as agent.

PRUDENT PERSON RULE: An investment standard. In some states the law requires that a fiduciary, such as a trustee, may invest money only in a list of securities selected by the state (the so-called legal list). In other states, the trustee may invest in a security if it is one, which would be brought by a prudent person of discretion and intelligence who is seeking a reasonable income and preservation of capital.

QUALIFIED PUBLIC DEPOSITORIES: A financial institution which does not claim exemption from the payment of any sales or compensating use or ad valorem taxes under the laws of this state, which has segregated for the benefit of the commission eligible collateral having a value of not less than its maximum liability and which has been approved by the Public Deposit Protection Commission to hold public deposits.

RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond or the current income return.

REPURCHASE AGREEMENT (RP OR REPO): A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed price on a fixed date. The security "buyer" in effect lends the "seller" money for the period of the agreement, and the terms of the agreement are structured to compensate him for this.

Dealers use RP extensively to finance their positions. Exception: When the Fed is said to be doing RP, it is lending money that is increasing bank reserves.

REVERSE REPO: An agreement whereby the dealer agrees to buy securities and the investor agrees to repurchase them at a later date.

SAFEKEEPING: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank's vaults for protection.

SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution.

SEC RULE 15C3-1: See uniform net capital rule.

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SECURITIES AND EXCHANGE COMMISSION: Agency created by Congress to protect investors in securities transaction by administering securities legislation.

SOCIAL IMPACT BONDS: Social impact bonds are used to finance programs such as affordable housing, poverty reduction, or other positive sustainable and social outcomes.

Social impact bonds eligible for inclusion in the City’s investment portfolio are typically issued by government agencies, and institutions such as the World Bank.

STRUCTURED NOTES: Notes issued by Government Sponsored Enterprises (FHLB, FNMA, etc.) and Corporations which have embedded options (e.g. call features, step-up coupons, floating rate coupons, derivative based returns) into their debt structure. Their market performance is impacted by the fluctuation of interest rates, the volatility of the imbedded options, and shifts in the shape of the yield curve.

SETTLEMENT DATE: The date on which a trade is cleared by delivery of securities against funds. This date may be the same as the trade date or later.

SUPRA NATIONALS: For purposes of this investment policy - obligations issued by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank.

TRADE DATE: The date on which the buyer and seller agree to a transaction. The trade date may or may not be the date on which the securities and money changes hands (settlement date).

TREASURY BILLS: A non-interest-bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months, or one year.

TREASURY BOND: Long-term coupon-bearing securities U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities of more than ten years.

TREASURY NOTES: Intermediate term coupon-bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities of from one to ten years.

UNIFORM CAPITAL RULE: Securities and Exchange Commission requirement that member firms as well as non-member broker-dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash.

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YIELD: The rate of annual income return on an investment, expressed as a percentage. (a) INCOME YIELD is obtained by dividing the current dollar income by the current market price for the security. (b) NET YIELD or YIELD TO MATURITY is the current income yield minus any premium above par or plus any discount from par in purchase price with the adjustment spread over the period from the date of purchase to the date of maturity of the bond.

YIELD TO MATURITY: The rate of return yielded by a debt security held to maturity when both interest payments and the investor's capital gain or loss on the security are taken into account.

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Packet Pg. 288 Attachment: Annual Update on City Investment Policy-Final REVISED 2023 (5566 : Annual Investment Policy Update) Redevelopment Successor
Agency Report
City Council Meeting: February 28, 2023
Agenda Item: 5.J
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To: Redevelopment Successor Agency
From: Denise Anderson Warren, City Clerk, Records and Election Services Department
Subject: Approval of minutes for Redevelopment Successor Agency meeting Recommended Action
Staff recommends that the Redevelopment Successor Agency approve the minutes of the December 13, 2022 meeting.

Prepared By: Maria Dacanay, Administrative Analyst
Approved Forwarded to Council
Attachments:

A. December 13, 2022 Redevelopment Successor Agency Minutes

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1 December 13, 2022
(NOT APPROVED)

CITY OF SANTA MONICA

REDEVELOPMENT SUCCESSOR AGENCY MEETING MINUTES
DECEMBER 13, 2022
A special meeting of the Santa Monica Redevelopment Successor Agency was called to order by Chair Davis at 8:49 p.m., on Tuesday, December 13, 2022, at City Council Chambers, 1685 Main Street.

Roll Call: Present: Chair Gleam Davis
Chair Pro Tem Lana Negrete
Agency Member Phil Brock
Agency Member Oscar De La Torre
Agency Member Christine Parra
Agency Member Caroline Torosis
Agency Member Jesse Zwick
Also Present: Executive Director David White
Agency Attorney Douglas Sloan
Agency Secretary Denise Anderson-Warren
CONVENE On order of the Chair, the Redevelopment Successor Agency convened to a joint meeting with the City Council at 8:49 p.m., with all members present.

REPORT ON MEETING

COMPENSATION
Pursuant to State law, Agency Secretary Denise Anderson-Warren announced that members will receive no compensation for meeting as the Redevelopment Successor Agency.

CONSENT CALENDAR:

JOINT MEETING WITH

THE REDEVELOPMENT

SUCCESSOR AGENCY

RECOGNIZED

OBLIGATION PAYMENT

SCHEDULE
There being a Consent Calendar for the Redevelopment Successor Agency and the City Council, the two Consent Calendars were heard concurrently.

5.Q. Adoption of Resolution Nos. 41 (SA) and 42 (SA) Approving the Annual Recognized Obligation Payment Schedule (ROPS), was presented.

Recommended Action
Staff recommends that the Redevelopment Successor Agency:

1. Adopt a finding that the adoption of a recognized obligation payment schedule and administrative budget is not a project

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within the meaning of the California Environmental Quality Act (CEQA); or, alternatively, is subject to the commonsense exemption under CEQA Guideline 15061(b)(3).

2. Adopt resolutions approving the Agency’s recognized obligation payment schedule and administrative budget for July 1, 2023 through June 30, 2024.

Agency/Councilmember Parra stated for the record that for Items 5.B.,

5.L., and 5.N. that she is employed by the City of Culver City and that she has checked with legal counsel and she has no conflict of interest on any of these items.

All items were considered and approved in one motion unless removed by an Agency/Councilmember for discussion.

At the request of Agency/Councilmember Parra, Items 5.D. and 5.F. were removed from the Consent Calendar.

Motion by Chair/Mayor Pro Tem Negrete, seconded by
Agency/Councilmember Brock, to approve the Consent Calendar except for Items 5.D. and 5.F., reading resolutions by title only and waiving further reading thereof. The motion was approved by the following vote:

AYES: Agency/Councilmembers de la Torre, Torosis, Brock, Parra, Zwick, Chair/Mayor Pro Tem Negrete, Chair/Mayor Davis
NOES: None
ABSENT: None
ADJOURNMENT: On order of the Chair, the Redevelopment Successor Agency meeting was adjourned at 9:04 p.m.

ATTEST: APPROVED:

Denise Anderson-Warren Gleam Davis
Agency Secretary Chair

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Packet Pg. 291 Attachment: December 13, 2022 Redevelopment Successor Agency Minutes (5635 : RSA Minutes (1 min)) City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 5.K
1 of 3
To: Mayor and City Council
From: Gigi Decavalles-Hughes, Director, Finance Department, Revenue Subject: Adoption of a Resolution to Establish an Advisory Committee to Make Recommendations Regarding Expenditure of additional funds raised by increasing the transient occupancy tax above 14%
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines;

2. Adopt the attached resolution establishing an advisory committee to make recommendations regarding the expenditure of additional funds raised by increasing the City’s transient occupancy tax rate by 1% for hotel stays and 3% for home-share stays pursuant to Measure CS.

Summary
Measure CS, which increases the City’s transient occupancy tax from 14% to 15% for hotels/motels and to 17% for home shares, was overwhelmingly approved by Santa Monica voters at the November 8, 2022, General Election. The new rates will go into effect on March 1, 2023. The more than $4 million in additional annual funds raised by the rate increase will provide new resources to help fund on-going urgent community priorities, specifically in the areas of enhancing safety and addressing homelessness.

To provide an additional level of accountability and oversight on the use of the revenues generated by Measure CS, the ballot measure requires that Council create an Advisory Committee that would make non-binding recommendations on the use of the additional TOT revenues. The measure further requires that the Advisory Committee be created

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by a resolution no later than February 28, 2023. The attached resolution will formally establish a five-member committee that includes Santa Monica residents and representatives from local hospitality businesses and the homeless behavioral health services community.

Discussion
The staff report recommending placing Measure CS on the ballot discussed a possible structure for a five-member committee with members representing local businesses including the hospitality industry, homeless behavioral health sector, and residents.

Within the attached resolution, staff is proposing a Committee made up of the following:
• Two members who are Santa Monica residents
• Two representatives or members from local hospitality businesses • One member representing the homeless behavioral health services community (not-for-profit, governmental or hospital)
Staff recommends that the Board members of Santa Monica Travel and Tourism provide recommendations to the City Council for the representatives from the hospitality business community. Aside from the City Manager or their designee, members of the Board of Santa Monica Travel and Tourism are selected equally by the Council and the Chamber of Commerce, so it is anticipated that the selection will be representative of the City’s broad business community. Staff also recommends that Council seek and recommend the resident members and the member representing the homeless behavioral health services community.

The scope of work of the Committee is to provide non-binding recommendations as to the use of the additional funds raised from the rate increases adopted by the voters pursuant to Measure CS. The Committee is subject to the rules of the Brown Act. It is proposed that Committee members would have two-year terms. The Committee will provide recommendations to the City Manager. The Committee members will select a Chair and Vice Chair at the first meeting of the calendar year. The Committee will meet at least once a year between February and May, with the goal of completing appointments this year to convene the Committee in May 2023, allowing for the Committee to provide its recommendations along with the adoption of the budget. The

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Finance Department will staff the administration of the Advisory Committee. The attached resolution provides further detail on the structure and scope of work of the Committee.

Environmental Review
Creation of the Advisory Committee is categorically exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines. Creation of the Committee is covered by the common sense exemption which states that CEQA does not apply, “where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” Creation of the Committee would not result in adverse physical impacts on the environment, and as such, is categorically exempt from CEQA.

Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the recommended action. Recommendations made by the Committee may result in how funds are allocated in the annual adopted budget.

Prepared By: David Carr, Assistant City Treasurer
Approved Forwarded to Council
Attachments:

A. 14108 - Resolution
B. Exhibit A - Resolution 11337

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1 City Council Meeting: February 28, 2023 Santa Monica, California RESOLUTION NUMBER _________ (CCS)
(City Council Series)

A RESOLUTION OF THE CITY COUNCIL

OF THE CITY OF SANTA MONICA ESTABLISHING A TRANSIENT OCCUPANCY

TAX ADVISORY COMMITTEE
WHEREAS, on February 8, 2022, the City Council of the City of Santa Monica (the “City Council”) directed staff to review the feasibility, timing, and structure of potential revenue measures including an increase to the City’s Transient Occupancy Tax (“TOT”); and
WHEREAS, the City’s TOT is contained in Chapter 6.68 of the Santa Monica Municipal Code; and
WHEREAS, staff engaged a consultant to complete a survey of Santa Monica voters to determine the viability of different tax measures and the community’s spending priorities on additional tax revenue; and
WHEREAS, at the May 24, 2022 Budget Study Session, the City Council directed staff to move forward with a tax measure to increase the City’s TOT; and WHEREAS, on June 28, 2022, the City Council adopted Resolution Number 11430 (CCS) by unanimous vote to place a measure, which would be later known as Measure CS, on the November 8, 2022 ballot to increase the City’s TOT; and WHEREAS, the June 28, 2022 staff report recommending that the TOT measure be placed on the ballot identified community priorities from the revenue measure poll, including expansion of services in the areas of homelessness and public safety; and

5.K.a
Packet Pg. 295 Attachment: 14108 - Resolution [Revision 5] (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 2 WHEREAS, Measure CS proposed to increase the City’s TOT rate from 14% to 15% for hotels and motels and to 17% for home-shares; and WHEREAS, Measure CS is estimated to bring in an additional $4,100,000 in annual revenue to the City (“Additional TOT Revenue”); and WHEREAS, the ballot question for Measure CS asked voters whether the City’s TOT should be increased to “address homelessness, improve 911 emergency response times and neighborhood police protection, make public areas safer and cleaner, including streets, sidewalks, parks, and the beach, and provide other vital City services,” and WHEREAS, a majority of Santa Monica voters voted in favor Measure CS at the November 8, 2022 General Election; and
WHEREAS, Measure CS states that the “City Council shall, no later than February 28, 2023, establish by resolution an advisory committee that will make non-binding recommendations as to the expenditure of additional funds raised by increasing the [TOT] above 14%;” and
WHEREAS, Santa Monica Travel and Tourism (“SMTT”) is a private, non-profit corporation formed in 1982 and funded by the City’s general fund and the Tourism Marketing District assessment; and
WHEREAS, SMTT’s purpose is to promote Santa Monica as a conference, business, and leisure travel destination and acts as a marketing representative for local businesses and the community as a whole; and
WHEREAS, the City Council now desires to establish a TOT Advisory Committee as required by Measure CS to provide non-binding recommendations on the City’s usage of the Additional TOT Revenue.

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Packet Pg. 296 Attachment: 14108 - Resolution [Revision 5] (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 3 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS:

SECTION 1. The City Council of the City of Santa Monica hereby establishes a TOT Advisory Committee to provide non-binding recommendations on the Additional TOT Revenue.

SECTION 2. Composition. The TOT Advisory Committee shall consist of five members who shall be appointed by the City Council through a public process. The five members of the TOT Advisory Committee shall include: (a) two members who are Santa Monica residents; (b) two members or representatives of the local hospitality businesses; and (c) and one member representing the homeless behavioral health services community. SMTT is authorized to provide the City Council with two non-binding recommendations for the two members or representatives from the local hospitality business for the City Council’s consideration.

SECTION 3. Open Meeting Laws. TOT Advisory Committee meetings shall be held in compliance with the State’s Open Meeting Laws. Notice of meetings, including adjournment, shall also be given in accordance with the provisions of the Ralph M. Brown Act, California Government Code section 54950 et seq. (the “Brown Act”). In the event of a conflict between the provisions of the Brown Act or any other law and any provision of these Rules of Conduct, the Brown Act, or other law, shall prevail. The noticing provisions shall further be subject to any amendments of the Brown Act.

SECTION 4. Quorum. A majority of TOT Advisory Committee members shall constitute a quorum for the transaction of business, except to adjourn. The City Manager, or designee, shall attend all TOT Advisory Committee meetings.

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Packet Pg. 297 Attachment: 14108 - Resolution [Revision 5] (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 4 SECTION 5. Officers Powers and Duties. At the first regular meeting of each calendar year, the TOT Advisory Committee shall elect a Chair and a Vice-Chair for a one-year term. Until new officers are elected, the outgoing officers shall continue to serve, when a quorum is needed and no officers are available. The Chair shall be the Presiding Officer at all meetings. In the absence of the Chair, the Vice Chair shall preside. In the absence of both the Chair and Vice Chair, the City Clerk or designee shall call the TOT Advisory Committee members present to serve until the arrival of the Chair or Vice Chair or until adjournment. Meeting agendas shall be prepared by the Chair in consultation with the City Manager or designee.

SECTION 6. Conduct of Meetings. Except as otherwise provided, the TOT Advisory Committee shall adopt bylaws that substantially follow the City’s Template Bylaws attached to Resolution Number 11337 (CCS), as amended from time to time. A copy of Resolution Number 11337 is attached hereto as Exhibit A and incorporated herein by reference.

SECTION 7. Regular Meetings. Regular meetings of the TOT Advisory Committee shall be held at least annually between February and May, at such locations, and at such times as may be fixed by the TOT Advisory Committee.

SECTION 8. Duties and Responsibilities. The duties and responsibilities of the TOT Advisory Committee include, but are not limited to:
(a) Proposing, considering, reviewing, and evaluating proposals for potential expenditures of the Additional TOT Revenue; and
(b) Comparing competing proposals for expenditures of the Additional TOT Revenue; and

5.K.a
Packet Pg. 298 Attachment: 14108 - Resolution [Revision 5] (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 5 (c) Determining what potential expenditures of the Additional TOT Revenue should be recommended to the City Manager as part of the budget adoption process; and
(d) Providing the City Manager with TOT Advisory Committee’s non-binding recommendations as to the Additional TOT Revenue.

SECTION 9. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect.

APPROVED AS TO FORM:
_________________________
Douglas Sloan
City Attorney
EXHIBIT A – Resolution 11337

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Packet Pg. 299 Attachment: 14108 - Resolution [Revision 5] (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) City Council Meeting: June 8, 2021 Santa Monica, California

RESOLUTION NUMBER (CCS)
(City Council Series)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA APPROVING THE CITY CLERK’S RECOMMENDED PROCEDURAL CHANGES

TO SANTA MONICA BOARDS, COMMISSIONS, COMMITTEES, AND TASK

FORCES, AND DIRECTING CITY BOARDS, COMMISSIONS, AND TASK FORCES TO IMPLEMENT THE CITY CLERK’S RECOMMENDED CHANGES AND ADOPT THE CITY CLERK’S TEMPLATE BYLAWS BY NO LATER THAN JANUARY 1, 2022
WHEREAS, at the December 17, 2019 City Council meeting, the City Clerk brought before the Santa Monica City Council (Council) a staff report requesting the establishment of a Community Working Group (CWG), in consultation with the City Manager’s Office and the City Attorney’s Office, to perform a comprehensive review of the City’s boards, commissions, committees, and task forces to make recommendations and suggestions regarding best practices and consider possible consolidation of certain boards and commissions with similar missions and purviews; and
WHEREAS, the overarching goal of the CWG was to promote participation in the City’s boards and commissions based on inclusion, diversity, and equity, and the CWG sought to support good governance and the development of leadership skills for members of the public participating on boards and commissions; and WHEREAS, over the course of four months, the CWG met to discuss policies and best practices regarding attendance; the standardization of templates for agendas, minutes, and bylaws; methods for making appointments to boards and commissions; financial and administrative support of boards and commissions; and the need to 11337
DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

5.K.b
Packet Pg. 300 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) consolidate certain boards and commissions; and
WHEREAS, the City Clerk provided the CWG’s recommendations to City boards, commissions, committees, and task forces, and encouraged them to meet to agendize discussion on the recommendations, and to provide any feedback they may have by April 15, 2021; and
WHEREAS, after careful consideration of the CWG’s recommendations, as well as feedback from City Department Heads, City staff, and the boards, commissions, committees, and task forces responding to the City Clerk’s request for feedback, the City Clerk created her own recommendations, and presented those recommendations to Council at its April 27, 2021 meeting; and
WHEREAS, at the April 27 Council meeting, Council provided the City Clerk with direction on boards, commissions, committees, and task forces best practices, and implementation of the City Clerk’s recommendations; and WHEREAS, the City Clerk now returns to Council for approval of the City Clerk’s recommendations, as revised to incorporate Council’s direction from its April 27 meeting.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA
MONICA DOES RESOLVE AS FOLLOWS:

SECTION 1. Council hereby approves the procedural changes to City of Santa Monica boards, commissions, and task forces, as set forth in Exhibit A, which is attached hereto and incorporated herein by this reference. Council also approves the template bylaws, which are attached hereto as Exhibit B and incorporated herein by this reference.

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 301 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) SECTION 2. Council hereby directs all City boards, commissions, committees, and task forces, with the assistance of the City Clerk’s office, to implement the procedural changes set forth in Exhibit A and adopt the template bylaws set forth in Exhibit B. A City board, commission, committee, and task force may add or keep provisions specific to that body to the bylaws, so long as the additional provisions do not conflict with the template bylaws. All City boards, commission, and task forces must implement the procedural changes set forth in Exhibit A and adopt the template bylaws set forth in Exhibit B by no later than January 1, 2022.

SECTION 3. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect.

APPROVED AS TO FORM:

GEORGE S. CARDONA
Interim City Attorney

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 302 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) Exhibit A
(Procedural Changes)
DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 303 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) City of Santa Monica
Boards, Commission and Task Force Approved Recommendations Effective July 1, 2022
Bylaws
A. Every City Board, Commission, and Task Force should have consistent bylaws, established by resolution, which include the following:

1. Officers shall serve no more than two consecutive years as Chair or Vice Chair, in order to promote diversity and provide a leadership opportunity for more members of the community.

2. The election of officers shall take place in July after the annual appointments.

3. Any board of commission with a December year-end appointment schedule shall move its appointments to June to align with the annual appointments.

4. All boards, commissions, and task forces shall produce an annual workplan to set priorities for the year, which should align with their corresponding department’s goals and objectives. All boards, commissions, and task forces shall also produce an annual one-page evaluation.

5. Required onboarding and annual training shall take place as soon as practicably possible after the appointments in July. Required annual training must be completed within three months of appointments in July.

6. All boards, commissions, and task forces shall adopt the agenda order of business found in the template bylaws. If an agenda item category does not apply to a particular board, commission, or task force, the inapplicability shall be noted on the agenda.

7. Attendance requirements shall be set forth in the Boards and Commissions Resolution and the template bylaws. Attendance requirements shall be consistent, and clarify the rules for what is considered an excused and an unexcused absence.

8. Except in extraordinary circumstances, the latest start time for any board, commission, or task force, and standing committee meeting shall be 7:00 p.m.

9. Accommodation language shall be included in the bylaws template after consultation from the Disabilities Commission.

10. The status of the Task Force on the Environment shall change to a permanent commission with the same term limits as other boards and commissions. The Task Force should be renamed the Commission on Sustainability and the Environment. A goal of achieving environmental justice should be added to the ordinance.

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 304 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations)

11.All existing Boards, Commissions, and Task Forces shall utilize the bylaws template to be consistent with the City Council format.

Term Limits
B. Term limits shall remain the same, allowing members to serve two consecutive terms and request a third term from the City Council. However, members who term out must wait one year before applying to another board or commission.

Unexcused Absences
C. Members who have two unexcused absences out of six consecutive meetings automatically vacate their seat. An absence is considered unexcused when a member does not communicate their absence to the Chair or liaison of the body prior to the scheduled meeting. If a member has more than two excused absences, they will receive a warning from the Chair. If another two meetings are missed, then the liaison shall inform the City Clerk’s office, who will then inform the City Council.

Special meetings shall not count towards unexcused absences. This applies to boards, commissions, and task forces meeting monthly. Boards, commissions, and task forces with meeting schedules other than monthly shall adopt bylaw provisions consistent with the intent of this rule.

Staff Liaisons
D. Staff liaisons are expected to do the administrative work for Boards and Commission and not intensive research. Staff research should be limited to information that the department uniquely has access to and should align with the department’s workplan.

Budget
E. Budgets for boards Commissions, and task forces shall be taken from each board, commission, or task forces corresponding department’s budget.

Enhancing Diversity, Equity, & Inclusion
G. The City Clerk shall explore all means to enhance diverse representation that reflects the Santa Monica community that includes:

1. Increase the use of social media to reach and encourage community members to get involved.

2. Consider involvement at fairs or booths at festivals, such as COAST, for interested applicants to meet active board and commission members and City Council members to learn more about each board and commission and have an opportunity to build connections.

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 305 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations)

3. Consider community-based meetings and cultural events that give residents more opportunity to have informal conversations about community needs and concerns.

4. Specific outreach to younger members of the community age 18 through 29 to sit on boards and commissions and have equal voting rights.

Five-Year Review
H. A comprehensive review of all advisory bodies should occur every five years except that no such review shall occur in an election year.

Update to Applications
I. Consider updating board, commission, and task force applications every five years.

Additional Training
J. Consider training sessions on running meetings, participating during meetings, parliamentary procedure, and other trainings including but not limited to implicit bias training. Such trainings would be for Commissioners but could also be open to general public (members of community groups, non-profit boards, etc.) DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 306 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) Exhibit B
(Template Bylaws)
DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 307 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 1 RULES OF ORDER AND PROCEDURE FOR THE SANTA MONICA (INSERT

NAME OF BODY)
RULE 1. RULES OF ORDER.

Except as otherwise provided by these rules (“Rules”), the City Charter, the Municipal Code, or applicable provisions of state law, the procedures of the (insert name of body) shall be governed by the latest revised edition of Roberts Rules of Order.

These rules, or any one of them, may be suspended by a vote of two-thirds (2/3) of the members present.

RULE 2. TIME AND PLACE FOR HOLDING REGULAR MEETINGS.

The (insert name of body) establishes the (insert meeting day) of each month as the day(s) for holding regular meetings. The regular meeting shall commence at (insert time). If any such (insert day of week) falls on any day designated by law by the City Council as a day for public feast, Thanksgiving, or holiday, such regular meeting shall be held on the date of the regular meeting next following said (insert day of week) at the hour heretofore fixed or at such other day as may be fixed. The (insert location) is established as the place for holding its regular meetings.

RULE 3. QUORUM AND ACTION.
(insert number for quorum) members of the (insert name of body) shall constitute a quorum for the transaction of business. Action shall be taken by a majority vote of the entire membership of the (insert name of body). However, in the case of a quasi-judicial hearing, if only (insert number for quorum) members are participating, the applicant or appellant shall be entitled to request and receive a continuance of the hearing, until such time as (insert number) members are participating.

Whenever any member questions the presence of a quorum, the presiding officer shall forthwith direct the Secretary to call the roll, each member shall respond when his or her name is called and the Secretary shall announce the result. Such proceedings shall be without debate, but no member who is speaking may be interrupted by a question as to the presence of a quorum.

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 308 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 2 The (insert name of body) may also establish standing subcommittees of its members to address designated areas of business on the (insert name of body) behalf and may establish ad hoc committees to formulate reports or recommendations on particular matters. Standing subcommittees established pursuant to this section are required to hold meetings in compliance with the Ralph M. Brown Act (the “Brown Act”), California Government Code Sections 54960 et seq., and in accordance with these Rules.

Either Council or (insert name of body) with the consent of Council may establish advisory groups made up of nonmembers to advise the (insert name of body) on designated areas of business. Advisory groups established pursuant to this section are required to hold meetings in compliance with the Brpwn Act and in accordance with these Rules.

RULE 4. ATTENDANCE.

Attendance at (insert name of body) meetings is expected of all members. An absence is defined as a failure to attend at least two-thirds of a meeting and includes both excused and unexcused absences. Members who have two unexcused absences out of six consecutive regular meetings shall automatically be deemed to have resigned. An absence is considered unexcused when a member does not communicate their absence to the Chair or liaison of the body prior to the scheduled meeting. If a member has more than two excused absences from regular meetings, the member shall receive a warning from the Chair. If the member misses another two regular meetings, the liaison shall inform the City Clerk’s office, who will then inform the City Council.

RULE 5. MEETINGS TO BE PUBLIC - EXCEPTION FOR CLOSED
SESSIONS.

As required by the Brown Act, all regular, adjourned regular, and special meetings of the (insert name of body) shall be public. Other than qualifying instances under the Brown Act for the Personnel Board, no board, commission, or task force is authorized to conduct closed sessions.

RULE 6. AGENDA.

The Staff Liaison shall prepare the Agenda as follows:

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 309 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 3 (a) The Liaison shall consult with the Chair and/or Vice-Chair in the preparation of the Agenda.
(b) The Agenda and all available supporting documents shall be provided to all members on the (insert day) preceding the scheduled meeting to which it pertains or as soon thereafter as possible, but no later than 72 hours prior to a regular meeting or 24 hours prior to a special meeting, as required by the Brown Act. (c) Any member may request that any matter within the jurisdiction of the (insert name of body) be reviewed for placement on the Agenda in consultation with the Staff Liaison and Chair. Members must submit proposed agenda items by (insert time) on (insert day items are due) in order to ensure that matters will be agendized for the following meeting. Subject to Brown Act requirements, items submitted after the deadline will be agendized for the following meeting, if possible. (d) The Staff Liaison shall submit the Agenda to the City Clerk’s Office for posting in a timely manner, to be posted as required by the Brown Act, no later than 72 hours prior to a regular meeting or 24 hours prior to a special meeting. Copies of the Agenda shall be posted in the lobbies of City Hall and the Public Safety Facility. Online posting of the Agenda shall be done in addition to physically posting agendas in the lobbies of City Hall and the Public Safety Facility. The City Clerk shall maintain on file in his or her office declarations establishing compliance with the posting requirements. (e) No action shall be taken on any item not appearing on the posted Agenda unless the item is added to the Agenda in the manner authorized by the Brown Act. (f) Matters directed to be placed on the Agenda at the direction of members shall be listed on the Agenda in the order of receipt by the Staff Liaison. (g) Written requests to the (insert name of body) shall be referred to the Staff Liaison or his/her designee. Written requests being agendized shall be scheduled for consideration at the earliest convenient meeting, taking into consideration the length and content of meeting agendas. Members of the public submitting written requests shall be advised of how their requests are being handled. Agendized communications shall be DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 310 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 4 listed on the Agenda in order of receipt. No communication shall be placed on an Agenda if it contains material that:
(1) Is profane.
(2) Is potentially slanderous or libelous.
(3) Advocates or opposes the candidacy of any person or party for any elective office.
(4) Is primarily an advertisement or promotion or has as a substantial purpose, the advancement of any cause the major benefit of which is private and not public.

Members of the public submitting written requests to the (insert name of body) are encouraged to limit their submissions to one per meeting.

RULE 7. CATEGORIES AND ORDER OF BUSINESS.

The business of the (name of body) shall be conducted in the order and manner specified below. The order may be changed by a majority vote of those present. The following is the order of business:
(a) Call to Order.
(b) Salute to the Flag.
(c) Roll Call.
(d) Special Ceremonial Agenda Items. This item includes proclamations, commendations, introductions of special guests, and presentations and reports by other non-City public entities or legislative bodies.
(e) Department Head Report. This item shall consist of a report from the Department Head (or designee) of the (insert name of City Department) on actions taken and upcoming actions to be taken relating to areas of interest to the (insert name of body). (f) Consent Calendar. The Consent Calendar shall consist of the approval of minutes of previous meetings and other routine items which do not necessitate a separate public hearing and which are determined in the Agenda preparation process to be relatively non-controversial. The consent calendar shall be considered as one item regardless of the number of matters appearing on it and may be approved by a single DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 311 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 5 vote. The title to the individual consent items need not be read unless a request to do so is made by any member. Members of the public shall have no more than one opportunity to address the (insert name of body) concerning any and all items on the consent calendar. Members of the public shall be heard prior to consideration of the Consent Calendar. Members may request to have individual matters removed from the Consent Calendar so that they may be heard on those matters. All matters remaining on the Consent Calendar may be approved by a single vote. Any items removed from the Consent Calendar shall be considered separately in the order of their appearance on the Agenda. Removed items may be heard immediately following the consent calendar (g) Study Session. During Study Sessions staff will present information regarding a complex matter that will be subject to deliberation and decisions in the future.

No action will be recommended or taken as part of the Study Session. (h) Continued Items. This item includes agendized items of a previous meeting not considered at such meeting. The (insert name of body) may vote by a majority of its members to have a carry-over item placed on a subsequent agenda as a continued item. (i) Administrative Proceedings. This item includes proceedings requiring the (insert name of body) to make a quasi-judicial decision concerning an individual application.
(j) Staff Administrative Items. This category will include policy matters to be considered by the (insert name of body).
(k) Public Hearings. This item consists of public hearings required by specific provisions of law.
(l) Resolutions. A resolution will be considered under this item only if the substance makes extensive public input advisable, or if it should be considered after another item on the Agenda, otherwise the resolution will be considered on the Consent Calendar.
(m) Written Communication. This item allows the (insert name of body) to consider issues raised by written submissions from the public.

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 312 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 6 (n) Member Items. Items requested by members for discussion and possible action.
(o) Public Input. This item allows members of the public to address the (insert name of body) on matters that are within their subject matter jurisdiction. No formal action may be taken on any matter under this item unless the item is specifically agendized.

RULE 8. PREPARATION OF MINUTES.

The Secretary of the (insert name of body) shall have exclusive responsibility for preparation of the Minutes, and any directions for corrections in the Minutes shall be made only by majority vote of the (insert the name of body).

RULE 9. APPROVAL OF MINUTES.

Minutes of a (insert name of body) meeting may be approved without reading if the Secretary has previously furnished each member with a copy and unless a reading is ordered by a majority vote of the (insert name of body).

RULE 10. PRESIDING OFFICER.

The Chair shall be the Presiding Officer at all meetings of the (insert name of body).

In the absence of the Chair, the Vice Chair shall preside. In the absence of both the Chair and Vice Chair, the Secretary shall call the (insert name of body) to order and a temporary Presiding Officer shall be elected by the members present to serve until the arrival of the Chair or Vice Chair or until adjournment.

RULE 11. POWERS AND DUTIES OF PRESIDING OFFICER.
(a) Participation. The Presiding Officer may move, second, and debate from the chair, subject only to such limitations of debate as are imposed upon members by these rules, and shall not be deprived of any of the rights or privileges of a member by reason of his or her acting as the Presiding Officer.
(b) Duties. The Presiding Officer shall (1) preserve order at all meetings of the (insert name of body), (2) state (or cause to be stated) each question coming before the (insert name of body), (3) announce the decisions of the (insert name of body) on all subjects; (4) decide all questions of order subject to the right to appeal rulings on DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 313 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 7 questions of order to the entire (name of body), and (5) encourage all persons present at the meeting to conform their conduct to the City's Civility Policy.

RULE 12. SWORN TESTIMONY AND SUBPOENA POWER.

The power and process to request that a person appearing before the (insert name of body) on any matter shall be sworn and the power and process for the (insert name of body) to issue a subpoena is provided in the Municipal Code section 2.32.060.

RULE 13. RULES OF DEBATE.
(a) Getting the Floor. A member desiring to speak shall gain recognition by the Presiding Officer.
(b) Questions to Staff. Every member desiring to question City staff shall address his or her questions to the Staff Liaison or designated staff. Members of the City staff, after recognition by the Presiding Officer shall hold the floor until completion of their remarks or until recognition is withdrawn by the Presiding Officer. (c) Interruptions. A member who has the floor shall not be interrupted when speaking unless he or she is called to order by the Presiding Officer, a point of order or a personal privilege is raised by another member or the speaker chooses to yield to a question by another member. If a member is called to order, he or she shall cease speaking until the question of order is determined.
(d) Points of Order. The Presiding Officer shall determine all points of order subject to the right of any member to appeal to the (insert name of body). If an appeal is taken, the question shall be: “Shall the decision of the Presiding Officer be sustained?” The Presiding Officer's decision may be overruled by a two-thirds vote of the members then present.
(e) Point of Personal Privilege. The right of a member to address the (insert name of body) on a question of personal privilege shall be limited to cases in which the member’s integrity, character, or motives are questioned or where the safety or welfare of the (insert name of body) is concerned.

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 314 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 8 (f) Privilege of Final Comment. The member moving the adoption of a resolution, or motion, shall have the privilege of speaking last on the matter after all other members have been given an opportunity to speak.
(g) Motion to Reconsider Actions. A motion to reconsider any action taken by the (insert name of body) may be made only by one of the members on the prevailing side and may be seconded by any member. Such motion may be made at any time and shall be debatable. A motion by a non-prevailing member or a request by a member of the public for reconsideration may be made only if one year has passed since the action was taken.
(h) Calling for the Question. A question may be called by majority vote of those present. However, neither the moving party nor the party seconding any motion may call for the question, each member shall be afforded one opportunity to speak on each item before the question is called, and a question may not be called to interrupt or cut off a particular speaker.
(i) Limitation of Debate. Members shall limit their remarks to the subject under debate. No member shall be allowed to speak more than once upon any particular subject until every other member desiring to do so has spoken. Prior to beginning deliberation, the (insert name of body) may, by a two-thirds vote of those present, limit the amount of time that each member may spend stating his or her views on a particular agenda item.

RULE 14. PROTEST AGAINST (insert name of body) ACTION.

Any member shall have the right to have the reasons for his or her opposition to any action of the (insert name of body) entered in the Minutes. Such opposition shall be made in the following manner: “I would like the Minutes to reflect that I opposed this action for the following reasons…”
RULE 15. DISCLOSURE FOR QUASI-JUDICIAL MATTERS.

On quasi-judicial matters, members shall verbally disclose off the record contacts relating to the item, after the item is called and before the (insert name of body’s) DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 315 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 9 consideration of the matter. Disclosure shall include the identity of any individual(s) with whom the member had contact and the nature of the contact.

RULE 16. PUBLIC TESTIMONY.
(a) Scope. Pursuant to the Brown Act, public testimony is permitted on all agenda items, and the public shall have an opportunity to comment on any matter which is not on the Agenda but is within the (insert name of body) jurisdiction. However, members of the public do not have the right to give testimony outside the scope of or unrelated to the agenda item under consideration. Additionally, members of the public should strive to avoid unduly reiterating their own or others’ testimony. (a) Registration. Any member of the public wishing to address the (insert name of body) regarding any item on the Agenda for public comment shall register with the Staff Liaison prior to the start of the meeting, if possible, but no later than prior to the hearing on that item. Any request received after the start of the hearing shall be considered late and may only be heard with (insert name of body’s) approval. (b) Manner of Addressing the (insert name of body). After being recognized by the Presiding Officer, each member of the public addressing the (insert name of body) shall go to the lectern, state his or her name and whom he or she is representing, if he or she represents an organization or other person. Each member of the public is encouraged, but not required, to also state his or her address, neighborhood, or city of residence. All remarks shall be addressed to the (insert name of body) as a whole and not to any individual member. After a public hearing has been closed, no member of the public shall address the (insert name of body) on the matter under consideration without first securing (insert name of body) approval.
(c) Time Limits. Except on Written Communication, members of the public shall limit their remarks to two minutes per agenda item unless the (insert name of body) grants additional time by majority vote. For purposes of these Rules, the Consent Calendar shall be considered one item. Persons speaking on another’s written communication and persons submitting late requests to speak, who receive permission to speak shall be limited to one minute. On Written Communication, those speaking on another’s item may speak only if the person raising the matter appears and testifies. If the DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

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Packet Pg. 316 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 10 person who raises the item does not appear and testify, the matter shall be received and filed and persons wishing to speak on the matter may give their testimony during Public Input. A member of the public wishing to speak on more than one item shall limit his or her remarks to a total of six minutes per meeting unless the (insert name of body) grants additional time by majority vote. A member of the public may allocate time between items in one-minute increments up to two minutes. Testimony given as an applicant or appellant does not count toward the six-minute maximum. A member reporting to the (insert name of body) on behalf of a Board or Commission shall not be subject to these rules on time limits; however, the (insert name of body) may limit the duration of such reports. (d) Special Time Limits for Applicants and Appellants for Public Hearings.

Applicants and appellants on administrative items shall limit their remarks to ten minutes and may reserve some of their time for use for rebuttal at the conclusion of the public hearing. The appellant shall have the opportunity to address the (insert name of body) first and last.

RULE 17. RULES OF CONDUCT AND SAFETY.

When the (insert name of body) is in session, all persons present must preserve safety and order and should strive to conform their conduct to the City's Civility Policy.

Members of the public should sit in the audience seating area, unless addressing the (insert name of body) or entering or leaving the meeting room, should not block the aisles with personal belongings, and should not bring audible equipment into the meeting room, including cellular telephones that could cause a disruption.

Any person who disrupts the meeting shall be called to order by the Presiding Officer. Disruption shall include but not be limited to, blocking the audience or camera view of the proceedings. If such conduct continues, the Presiding Officer may request the removal of the person from the meeting room.

RULE 18. ENTITLEMENT TO VOTE AND FAILURE TO VOTE.

Every member is entitled to vote unless disqualified by reason of a conflict of interest. A member who abstains from voting consents to the decision made by the voting members.

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Packet Pg. 317 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 11 RULE 19. VOTING PROCEDURE.

Any vote of the (insert name of body), including a roll call vote, may be registered by the members answering “Yes” for an affirmative vote or “No” for a negative vote upon his or her name being called by the Staff Liaison. The Chair shall vote last.

RULE 20. DISQUALIFICATION FOR CONFLICT OF INTEREST.

Any member who is disqualified from voting on a particular matter by reason of a conflict of interest shall publicly state or have the Presiding Officer state the nature of such disqualification and shall leave the dais prior to (insert name of body) consideration of the matter. A member stating such disqualification shall not be counted as part of a quorum and shall be considered absent for the purpose of determining the outcome of any vote on such matter.

RULE 21. TIE VOTE.

Tie votes shall be lost motions.

RULE 22. CHANGING VOTE.

The vote of a member may be changed only if he or she makes a timely request to do so immediately following the announcement of the vote by the Staff Liaison or the Presiding Officer and prior to the time that the next item in the order of business is taken up.

RULE 23. PROCEDURE ON AGENDA ITEMS REQUIRING A MOTION.

The following procedure shall be followed in connection with any Agenda item requiring a motion:
(a) Staff Liaison reads the title.
(b) Presiding Officer calls for a staff report.
(c) Members question City staff.
(d) (insert name of body) receives Public testimony.
(e) (insert name of body) deliberates.

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Packet Pg. 318 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) 12 (f) A member makes a motion, another member seconds the motion, and the (insert name of body) debates it, with the maker of the motion having the opportunity to speak last.
(g) The Presiding Officer or Staff Liaison restates the motion. (h) The (insert name of body) votes on the motion.
(i) The Presiding Officer or Staff Liaison announces result.

RULE 24. PRESENCE OF CITY STAFF AT (insert name of body) MEETINGS.

The Staff Liaison shall attend and be present during all (insert name of body) meetings and give necessary service and advice.

RULE 25. RECORD OF MEETINGS.

All public meetings of the (insert name of body) shall be recorded. The recording shall be made by the Secretary and retained in accordance with the City’s record retention schedule. The use of other recording or television equipment is permitted so long as it is not disruptive of the meeting.

RULE 26. INTERPRETATION AND MODIFICATION OF THESE RULES.

These rules shall be interpreted liberally in order to provide for the optimum in the free interchange of information and public debate without an unnecessary waste of time or duplication of effort. These rules may be amended by City Council resolution.

RULE 27. FAILURE TO OBSERVE RULES OF ORDER.

These rules of order and procedures govern the conduct of (insert name of body) meetings. These rules are intended to expedite the transaction of the business of the (insert name of body) in an orderly fashion and are deemed to be procedural only. Failure to strictly observe these rules shall not affect the jurisdiction of the (insert name of body) or invalidate any action taken at a meeting that otherwise conforms to law.

DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

5.K.b
Packet Pg. 319 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) Adopted and approved this 8th day of June 2021.
__________________________
Sue Himmelrich, Mayor
I, Denise Anderson-Warren, City Clerk of the City of Santa Monica, do hereby certify that Resolution No. 11337 (CCS) was duly adopted at a meeting of the Santa Monica City Council held on the 8
th day of June 2021, by the following vote:

AYES: Councilmembers Brock, Davis, De la Torre, Parra,
Mayor Pro Tem McCowan, Mayor Himmelrich
NOES: None
ABSENT: Councilmember McKeown
ATTEST:
_____________________________________
Denise Anderson-Warren, City Clerk
DocuSign Envelope ID: 2093083D-7EF9-44E0-A2C4-7177474B8100

5.K.b
Packet Pg. 320 Attachment: Exhibit A - Resolution 11337 (5533 : Resolution Establishing an Advisory Committee to Make Recommendations) City Council
Report
City Council Meeting: February 28, 2023
Agenda Item: 7.A
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To: Mayor and City Council
From: Rick Valte, Public Works Director, Public Works, Resource Recovery & Recycling
Subject: Solid Waste Rate Study
Recommended Action
Staff recommends that the City Council:

1. Receive staff analysis of the Resource Recovery and Recycling solid waste rate study.

2. Review rate adjustment options and provide direction.

3. Consider the creation of a solid waste rate discount program and provide direction.

Executive Summary
The City’s Resource Recovery and Recycling Division (RRR) is an enterprise fund operation that provides sanitation and waste services to foster a clean, safe, and sustainable Santa Monica. In FY 2022-23, RRR has an annual budget of $37 million and employs a workforce of 93.9 full-time equivalent (FTE) essential workers who provide services to Santa Monica residents, businesses, and visitors. The City was due for solid waste rate adjustments in 2020 but made a conscious decision to defer rate increases as a way to protect ratepayers from further financial challenges during the COVID-19 pandemic. After three years without any adjustment in rates, RRR must adjust its rates in 2023 to ensure financial self-sufficiency, operational resiliency, and adapt to both new State mandates and the changing needs of RRR customers.

The RRR operation is self-sustaining through its revenue-generating services and requires no financial subsidy from the General Fund. In fact, 92% of RRR’s revenue

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comes from solid waste utility billing. Due to the three-year delay in evaluating rates, RRR today relies on reserves to make up the difference between revenues and operational costs. Adding to the immediacy of the situation is emerging service mandates from the State’s Short-Lived Pollutants Act (SB 1383) and a significant increase in requests for bulky item pick up and other services. A solid waste rate increase is necessary beginning in FY 2023-24 to remain solvent and sustain RRR operations. Without a rate increase, RRR would deplete its reserve funds in early FY 2024-25, unable to continue providing sanitation and recycling services to the community and fail to meet State regulations on mandatory recycling.

In this report, staff will discuss the RRR services that are funded by the solid waste rates, the status of the RRR enterprise fund, why a rate adjustment is necessary, two rate adjustment options, and the proposed timeline for the next six months.

Staff recommends that the City Council review the two rate options presented in this staff report and provide direction. Based on comments received from Council and through the community outreach process, staff will present the final solid waste rate study for Council approval in June 2023 and implement new rates beginning August 2023 and on July 1st thereafter from 2024 through 2028.

Background
Resource Recovery and Recycling Services
The City provides more services funded by its solid waste rates than most other jurisdictions in Los Angeles County or the State. These services include:

1. 7-day-a-week year-round sanitation services to over 93,000 Santa Monica residents (service ratio: 1 RRR employee serves 1,000 people) and an estimated 147,000 (post-pandemic) to 250,000 (pre-pandemic) of daytime population including international and regional tourists, shoppers, and workers (service ratio:
1 RRR employee serves 1,565-2,662 people)

2. Regulatory compliance, implementing California’s mandatory recycling laws, and leading the City Council’s Zero Waste by 2030 sustainability goal

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3. Collecting, transporting, and recycling/disposing three streams of solid waste materials from 7,000 single-family, 5,000 multi-family, and 1,450 commercial customers: landfill trash, recyclables, and organics

4. Bulky item pickup and illegal dumping collection and alley cleanup

5. Sweeping all streets to prevent debris from entering the storm drains and polluting the Santa Monica Bay

6. Servicing sidewalk litter and recycling containers (excluding containers in:

Downtown Santa Monica -- maintained by the City’s Promenade Maintenance division; Santa Monica Beach – maintained by the City’s Beach Maintenance division; and all City parks – maintained by the City’s Public Landscape division)

7. Household and small business hazardous waste collection program

8. Zero waste programs, including construction and demolition material recycling, zero waste event management, education and outreach, on-demand door-todoor household hazardous waste collection, community recycling events (e.g. paper shredding and compost giveaway), and edible food recovery

9. Pressure-washing services (fee-based service)

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Figure 1. RRR Services. RRR staff provide more services than most jurisdictions, including alley cleanup, street cleaning, collecting and transferring the City’s recyclables and organics, community recycling events, door-to-door hazardous material pickup for residents, and zero waste programming.

With a full-service municipal solid waste operation, Santa Monica enjoys the added benefits of:

1. Local control over operations and cost.

2. Flexibility in service offerings.

3. Ability to pivot to meet public needs, City and State policies, and Council priorities.

Santa Monica is one of only three cities in Los Angeles County that provides the above services to both its residential and commercial customers as a municipal service (the other two cities are Culver City and Claremont). Table 1 provides a service comparison with Culver City, Claremont, and other neighboring cities.

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Table 1. Solid Waste Service Comparison
City
One Bundled Rate
for Trash,
Recyclables, and
Organics to
Incentivize
Recycling
Unlimited Bulky
Item and Illegal
Dumping
Collection
Included in Rate
Door-to-Door
Household
Hazardous
Material (HHW)
Collection
Included in Rate
Monthly Recycling
Events Included in
Rate (e.g. paper
shredding,
compost giveaway,
etc.)
Zero Waste
Goal
Programs
Santa Monica Yes Yes Yes, for all
residential
customers
Yes, for all
residential
customers
Yes
Culver City Yes, for singlefamily residents
only; multi-family
and commercial
customers must pay
for each container
separately
Yes, for
residential
customers
No No No
Claremont Yes Yes – 3 items per
year for
residential
customers only
No No No
Burbank Yes, for singlefamily residents
only; multi-family
and commercial
customers must pay
for each container
separately
No No No No
Beverly Hills Paid via tax roll
based on home’s
square footage
Yes No No No
West
Hollywood
No - all customers
must pay for each
container separately
Yes No No No
Santa Monica’s rates also compare favorably to that of these cities. Single-family rates are slightly higher than comparable cities to account for the additional services provided above. The rates for multi-family and commercial are substantially lower than the comparable cities and will be examined further in the discussion section below.

RRR Expenditures: Where Does the Money Go?
RRR provides high levels of service to the community, with a history of low-rate increases, controlled expenses, and steady reserves in the years leading up to 2020.

After reviewing financial data from the last ten years, the City’s rate study consultant concluded that the RRR Enterprise Fund was very healthy in all years.

In addition to maintaining financial stability, RRR was able to successfully navigate through the global downturns in recycling markets resulting from China’s National

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Sword Policy in 2017 while implementing several important State mandates, including mandatory commercial recycling (AB 341) in 2012, mandatory commercial organics recycling (AB 1826) in 2016, and the Short-Lived Pollutants Act for mandatory organics recycling (SB 1383) in 2022.

RRR has a total budget of $37 million for FY 2022-23, which includes operating costs, capital improvement programs, and non-departmental transactions. As illustrated in Figure 2, the majority of expenses fall into either labor (33%), vehicles and capital assets (32%), or post-collection activities including the transportation, disposal, and recycling of solid waste materials (23%).

Figure 2. RRR Expenditures Breakdown, FY 2022-23
RRR Revenues: Where Does the Money Come From?
The RRR operation is funded by the RRR Enterprise Fund. Independent from the General Fund, enterprise funds operate like private enterprises – revenues must cover expenditures, and proper reserves must be maintained for unexpected expenses. The RRR Enterprise Fund functions as a separate financing entity, and it is self-sustaining through its own revenue sources and expenditures without any General Fund subsidy.

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RRR is projected to generate $29 million in revenues in FY 2022-23. Figure 3 demonstrates that over 92% of revenue comes from solid waste utility billing – the predominant source of revenue to fund RRR services. The rest comes from fee-based services (5%), such as pressure washing, plan checks, and permit fees, and other miscellaneous sources (3%), including Federal and State government rebates for alternative fuel credits and recycling programs.

Figure 3. RRR Revenues Breakdown, FY 2022-23
RRR Rate Study
The mechanism through which to analyze and set solid waste utility rates is called a rate study, commonly conducted by an independent solid waste consulting firm. The City’s fiscal policy for utility enterprise funds is to conduct a rate study every five years to set new rates for the next five years. The last solid waste rate study was approved by City Council nearly nine (9) years ago in 2014 (Attachment A). In 2019, staff engaged R3 Consulting Group, Inc. to conduct a new rate study. The rate study was near completion in early 2020, with planned rate updates beginning in FY 2020-21, when the COVID-19 global pandemic brought the process to an abrupt halt.

COVID-19 Impacts
In March 2020, the RRR rate study was suspended at the onset of the COVID-19 pandemic and the subsequent stay-at-home orders and business shutdowns in the

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United States. Mindful of the uncertainties and hardships faced by many, the City made a conscious decision to avoid placing additional financial burdens on ratepayers by putting the RRR rate study and proposed rate increases on pause. The pandemic lasted longer than expected, resulting in a three-year rate freeze in 2020, 2021, and 2022.

Solid waste utility rates have not increased since FY 2019-20. The historical rate increases since the 2014 rate study, and the three-year rate freezes since 2020, are shown in Table 2 below.

Table 2. City’s Historical Solid Waste Rate Increases
Year Single-Family
Customers
Multi-Family
Customers
Commercial
Customers
2014-15 3.85% 1% 7.25%
2015-16 3.85% 1% 7.25%
2016-17 3.85% 1% 7.25%
2017-18 CPI - 2.5% CPI - 2.5% CPI - 2.5%
2018-19 CPI - 3.7% CPI - 3.7% CPI - 3.7%
2019-20 CPI - 2.6% CPI - 2.6% CPI - 2.6%
2020-21 COVID 0% 0% 0%
2021-22 COVID 0% 0% 0%
2022-23 COVID 0% 0% 0%
While the City’s solid waste rates sustained a 0% increase for the past three years, inflation and the cost of doing business kept rising. The nation’s inflation rate skyrocketed to 7.1% in 2021 and 6.5% in 2022, while the previous average between 2012 to 2020 was 1.6%. Concurrently, the State’s mandatory organics recycling law SB 1383 came into effect in 2022, necessitating the adoption of a local mandatory organics recycling ordinance, investment in additional resources to implement the State and local laws, and meeting regulatory compliance. The combination of inflation, contractual and supply cost increases, and new mandated compliance resulted in a $9.5 million expenditure increase in the RRR Enterprise Fund for FY 2022-23, as demonstrated in Figure 4.

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Figure 4. While COVID-19 Triggered a Three-Year Rate Freeze, Cost of Doing Business Increased by $9.5M After a three-year rate freeze, updated solid waste rates are necessary at this critical juncture to sustain the RRR operation. Accordingly, staff re-engaged the rate consultant to update and complete the 2022 solid waste rate study (Attachment B). The rate findings (Attachment F) are summarized in the Discussion section below.

Past Council Actions
Meeting Date Description
5/13/2014 (Attachment A) Adoption of Solid Waste Rates
2/14/2023 (Attachment B) 2022 Solid Waste Rate Study Third Contract Modification Discussion
Current Fund Status
The three-year rate freeze and the increased cost of doing business created the perfect storm for the RRR Enterprise Fund. Despite prudent budget management, organizational restructuring, deferring capital projects, and leveraging reserves on a one-time basis during the difficult COVID years to postpone a rate increase to the ratepayers, much of the available RRR Fund reserves have been spent down. As explained earlier, revenues generated from solid waste utility billing and other

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miscellaneous programs ($29 million) are projected to be $8 million lower than the required operating and capital funds to maintain operation ($37 million) in FY 2022-23.

In other words, the Fund is currently operating at a structural deficit of $8 million and relying on reserves to sustain RRR services. The current fiscal year started with $22.5 million in reserves in July 2022, of which 35% (estimated at $8 million) is projected to be used to fund RRR’s operation until the end of June 2023.

Trends Impacting the Fund
Since the last rate study was approved in 2014, there have been significant changes to the solid waste industry. Any new rate study looking forward must take into account a number of dynamic factors.

New State Mandates
The mandates of the State’s Short-Lived Pollutants Act (SB 1383) and the City’s corresponding mandatory organics ordinance adopted in November 2021 means increasing service demand for organics collection. Since adoption, over 2,500 additional organics containers have been, and more will continue to be, distributed to new locations as RRR implements green container rollout to all neighborhoods. This is an additional route of service that must be provided to every customer.

SB 1383 also mandates the City to educate and enforce organics recycling by inspecting locations to ensure compliance. Currently, RRR has one Zero Waste Assistant to cover the outreach, education, and compliance inspection of over 13,000 solid waste account locations in the City.

Staffing
Solid waste collection is an incredibly labor-intensive operation. The quantity and quality of staff make a huge difference in establishing a resilient and efficient workforce. A total of 24 as-needed frontline personnel and 4 permanent positions were eliminated from RRR during COVID-19 restructuring. As staffing reduced, remaining workers had to work faster and longer hours to cover services, resulting in an unsustainable work environment. As a result, daily absences rose 57% from 5.15 FTE in FY 2019-20 to

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8.09 FTE in FY 2021-22 and continue to rise in FY 2022-23. These statistics already excluded callouts related to COVID-19 illnesses. These open and unassigned collection routes that currently exist on most days must be added to other RRR Equipment Operators’ daily workload regardless of their original route assignment (Landfill Trash, Recyclables, or Organics). Workers oftentimes struggle to finish their original assigned route plus the additional stops. Uncollected stops are rolled over to the following days, leading to further service delays and customer frustration. Therefore, staffing shortages cause an adverse domino service impact on the overall collection schedule and operation. Without right sizing the collection staff, missed or delayed collections will continue to increase as existing staffing is insufficient to meet new mandated demand and frequencies.

Changes in Customer Needs
There has been a notable uptick in illegal dumping activities and bulky item collection requests. One observation is consumer behavior changed during the pandemic and exacerbated the problem of discarded items. Many residents cleaned out large items from their homes, purchased “fast furniture” (Attachment C) that are not meant to be durable, and switched to online shopping and delivery services for groceries and other goods that resulted in additional discarded packaging materials. Many of those new habits persist today.

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Figure 5. Alley Cleanup is a Critical Service to Maintain a Clean and Safe Santa Monica Before and after photos of an alley cleaned up by RRR
Simultaneously, the inception of the City’s 311 team in March 2021 made it easier than ever for residents to report on issues or request services, including bulky item and illegal dumping removal. As a result, the number of 311 requests the City received for bulky item and illegal dumping collection gradually increased over time and surged to a staggering 180 requests per day in January 2023. Bulky item and illegal dumping cleanup was the number one requested City service of all 311 tickets citywide.

Beyond just the additional trash in the alleys, the City’s street sweeping operations are also in a period of transition. The City is projected to have constructed 3.56 miles of protected bike path by the end of FY 2022-23 to promote car-free transportation and improve bike rider safety. The total mileage of protected bike path is anticipated to expand threefold to 10.41 miles in FY 2023-24 and almost seven times to 21.05 miles in FY 2025-26.

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Protected bike paths create additional sweeping needs that cannot be accommodated within the current street sweeping structure. The City’s streets are divided into different street sweeping districts, each with a different “No Parking” two-hour window as enforced by Traffic Services in the Police Department. Therefore, street sweeping is a time-sensitive service: RRR workers must complete sweeping dozens of streets within the same two-hour window before parking restrictions are lifted and parked cars return.

Meanwhile, protected bike path sweeping requires a different vehicle and timing. As the quantity increases, additional resources will be required to maintain clean and safe paths moving forward.

Sustainability
Santa Monica maintains a long-standing commitment to sustainability and fighting climate change. A central tenet of that effort has been the mandate of achieving Zero Waste by 2030. Above and beyond what has been mandated by the State, Council adopted in 2014 (Attachment D) and updated in 2019 (Attachment E) the City’s Zero Waste Strategic Operations Plan (Zero Waste Plan) to provide an environmental policy framework that can guide the City on its path to achieving zero waste (1.1 pound per person per day, or PPD, of landfill waste disposal by 2030).

The City currently generates 3.5 PPD, and much progress is needed in zero waste strategy implementation during the span of this rate study in order to achieve the 2030 goal. Staff continue to identify new and expanded zero waste opportunities that help to increase diversion from landfills as techniques and technologies become available.

How Proposed RRR Rates are Calculated
It is important to understand the City’s rate setting methodology. The 2023-2028 FiveYear Solid Waste Rate Study forecasts the future performance of the RRR Fund, including expenses, use of reserves, target reserve levels, and the overall revenues necessary to cover expenses and meet reserve targets over time. Expenses were forecasted based on current expenses as well as conservative increases in those

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expenses and other proposed, planned, or known changes to costs over time (i.e., proposed staffing rightsizing and anticipated increases to post-collection expenses, as examples). From there, expenses were allocated to one of two categories – carts or bins – which correspond to the primary service offering types available to residents and businesses. That allocation was made based on a blended metric of the number of accounts served, the number of days they are served, the number of annual tons collected, and the amount of revenue derived from that category. Once the expenses were allocated to carts vs. bins, then the amount of those expenses were compared to the amount of revenue derived from current rates. Because the RRR Fund is currently running a deficit, revenues from both cart and bin customers are less than the expenses attributed to the service provided to each of those categories. Thus, revenues for both cart customers and bin customers need to increase in order to cover forecasted expenses.

Any rate or fee calculated through a rate study must conform with the requirements of Proposition 218. Proposition 218 fees include fees for sewer, water, and refuse service. Proposition 218 imposes the following standards on the amount of fees that can be charged, as follows:
• Revenues derived from the fee or charge must not exceed the funds required to provide the property-related service;
• Revenues derived from the fee or charge must not be used for any purpose other than that for which the fee was imposed;
• The amount of a fee or charge imposed upon any parcel must not exceed the proportional cost of services attributable to the parcel, though a parcel by parcel analysis is not required before imposing the fee;
• The fee or charge may not be imposed for a service unless the service is actually used by, or immediately available, to the owner of the property subject to the fee or charge;
• No fee or charge may be imposed for general services, where the service is available to the public in substantially the same manner as it is to property owners.

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Proposition 218 also requires at least 45-day notice of the public hearing at which the rates are considered and an opportunity to protest the rates is provided before the rates are imposed. The City will mail the public notice outlining the proposed rate changes to all property owners and utility account holders no later than 45 days prior to the public hearing date.

Rate Strategies: Next Five Years
As the community slowly recovers from the COVID-19 impacts, the City intends to continue protecting ratepayers and aiding economic recovery by smoothing the necessary rate increases to be consistent across all years and avoiding dramatic nearterm rate spikes. In order to gradually phase in the rate increases, the rate study report recommends the continued use of reserves through the next three fiscal years (estimated at $9.8 million) to offset a portion of the increases that would have been otherwise needed. In other words, the RRR Enterprise Fund is projected to continue operating at a structural deficit (revenues below expenditures) in FY 2023-24, FY 2024- 25, and FY 2025-26 even if Council approves the proposed rate increases discussed in the rate adjustment options section of this report.

By the end of FY 2025-26 (Year 3 of this rate study period), the fund reserves are projected to dip to 6.9% or $2.7 million. The rate study strongly advises that the City slowly build up its reserves to the recommended level of 25% or 90 days of operating budget expenses by FY 2027-28 (Year 5 of this rate study period) for the following reasons:
• A 90-day operating reserve is the industry best practice for solid waste enterprise funds in the state.
• A 90-day operating reserve is the City’s adopted reserve target for other utility enterprise funds, such as the Water and Wastewater Funds and would provide uniformity across municipal-provided utilities.

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• A 90-day reserve can tolerate a higher level of economic uncertainty and absorb more risk around unrealized revenues from utility billing. During the peak of the COVID-19 pandemic, many businesses shut down; offices transitioned to remote or hybrid working; and restaurants shortened their business hours or shifted to takeout service only. All of these changes meant commercial customers were requesting a reduced level of solid waste collection and thereby less billing revenues for the RRR Fund.

Keeping rate increases moderate is important in the current economic climate.

Simultaneously, the City bears a fiscal responsibility to keep the RRR Enterprise Fund healthy so that it can continue to provide critical sanitation, public health, and zero waste services to maintain a clean, safe, and sustainable community for residents and businesses. Staff believes maintaining three months of operating expenses in reserve for an operation of this size is a prudent fiscal policy (Figure 6).

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Figure 6. RRR Fund History and Forecast, FY 2014-2028
Two rate adjustment options will be proposed and discussed below. Option One – staff’s recommendation -- would accomplish the following five goals for the next five years:

1. Achieve financial stability in the RRR Enterprise Fund to sustain RRR operations and meet State mandated regulatory compliance

2. Build fund reserves to industry standards of 90-day operating budget by Year 5

3. Modernize and simplify the rate structure to meet solid waste industry standards

4. Right-size staffing level to meet current community needs

5. Enhance services to support Council’s priority to maintain a clean and safe city through the establishment of a regularly scheduled alley cleanup service by enhancing the Bulky Item Illegal Dumping (BIID) response team and creating a new quarterly Community Cleanup Program (CCP)

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Option Two – a slightly reduced rate increase -- would still accomplish the first four goals. However, it would not allow for the capacity to achieve the fifth goal of enhanced clean and safe services.

Option One: Enhanced Clean and Safe Services (Staff Recommendation) Option One is the staff recommended “Enhanced Clean and Safe Services” option.

Under Option One, rates would be restructured in year one to accurately account for the true costs of services provided and align the fee structure with the best management practices of the industry. The remaining four years of the rate study would then apply a consistent 11% annual increase to all services evenly.

Table 3. Proposed Rates of Typical Services for Option One, Including Annual Change in Rate in Dollar and Percentage Customer Type Current
FY 2022-23
Monthly
Proposed
FY 2023-24
Monthly
Proposed
FY 2024-25
Monthly
Proposed
FY 2025-26
Monthly
Proposed
FY 2026-27
Monthly
Proposed
FY 2027-28
Monthly
Single-Family
One (1) 65-gallon 1x
per week
$41.78 $46.37
+$4.60
11%
$51.47
+$5.10
11%
$57.13
+$5.66
11%
$63.42
+$6.29
11%
$70.39
+$6.98
11%
One (1) 95-gallon 1x
per week
$53.90 $59.83
+$5.93
11%
$66.41
+$6.58
11%
$73.71
+$7.30
11%
$81.82
+$8.11
11%
$90.82
+$9.00
11%
Multi-Family
Four-Unit Apartment
Two 95-gallon 1x per
week
$99.28 $119.65
+$20.37
21%
$132.81
+$13.16
11%
$147.42
+$14.61
11%
$163.64
+$16.22
11%
$181.64
+$18.00
11%
Ten-Unit Apartment
One 300-gallon 2x per
week
$222.58 $275.00
+$52.42
24%
$305.25
+$30.25
11%
$338.83
+$33.58
11%
$376.10
+$37.27
11%
$417.47
+$41.37
11%
Commercial
Small Retail
One 95-gallon 1x per
week
$88.21 $57.13
-$31.09
-35%
$63.71
+$6.58
11%
$71.01
+$7.30
11%
$79.12
+$8.11
11%
$88.12
+$9.00
11%
Mid-Size Retail
One 2-cubic-yard 1x
per week
$131.34 $154.69
+$23.36
18%
$172.01
+$17.32
11%
$191.23
+$19.22
11%
$212.56
+$21.33
11%
$236.23
+$23.68
11%
Staff is requesting a total of 15.12 full-time-equivalent (FTE) positions beginning FY 2023-24 to right-size the RRR operation to meet the community’s emerging service needs, address service gaps, comply with State SB 1383 regulatory requirement of mandated organics recycling collection, establish a regularly scheduled alley cleanup

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service by enhancing the BIID response team, and to create a new, volunteer-driven Community Cleanup Program that would support a more sustainable and resilient operation. The additional positions would break down as follows:

Right-Size Solid Waste and Recyclable Collection Staffing Staffing requirement: 1 RRR Superintendent, 1 RRR Equipment Operator, 5 Bin Truck Drivers (7 FTE)
This request is intertwined with the section below as it relates to added organics collection required by SB 1383 mandatory compliance.

SB 1383 Mandatory Compliance and Zero Waste by 2030 Implementation Staffing requirement: 2 RRR Equipment Operators, 1 Zero Waste Assistant (3 FTE) To ensure timely organics collection services, RRR would need to add new organics collection routes to service these new locations, necessitating additional drivers and collection trucks.

Right-Size Sweeping Services
Staffing requirement: 1 Motor Sweeper Operator (1 FTE)
The current staffing level is unable to provide street sweeping services during the existing time-restricted posted areas or absorb the addition of sweeping within the protected bike paths. As protected bike path infrastructure continues to expand, the sweeping service demand will continue to grow thus requiring a dedicated vehicle and staff member.

Establish a Regularly Scheduled Proactive Alley Cleanup Service by Enhancing the Bulky Item and Illegal Dumping (BIID) Response Team
Staffing requirement: 2 RRR Equipment Operator, 5 Bin Truck Drivers (7 FTE)

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RRR’s BIID team currently consists of three employees, covering more than 200 miles of streets and alleys in the City daily. Due to staffing shortages discussed earlier, these employees are frequently reassigned to cover residential and commercial collection or other duties, consequently interrupting BIID alley cleanup services.

Proactive, timely alley cleanup is labor-intensive; it requires a consistent service schedule and a sufficient staffing model. The proposed staffing requirement would restore four crews for the BIID response team. This would allow RRR to create an established schedule that customers can count on for alley cleaning and illegal dumping every Monday through Friday, instead of reactively responding to 311 reports of items discarded in the public right of way.

The additional staffing would also allow RRR to assign more workers to container delivery, from replacing damaged or stolen containers to distributing new green organics containers for SB 1383 mandatory organics recycling. The result will be speedier container delivery and achieving State compliance sooner.

Creation of a New Quarterly Community Cleanup Program (CCP) Staffing requirement: Zero – Work will be absorbed by the BIID response team Another community benefit of right-sizing to a fully-staffed BIID response team is to provide RRR the required staff capacity to establish and support a new volunteer-driven Community Cleanup Program (CCP).

The City has received requests to create volunteer cleanup events, at which neighborhood group associations and individuals can mobilize teams of volunteers, consisting of City residents and/or businesses, to clean up their neighborhoods.

Volunteers at these events would be provided with cleanup supplies and assistance from BIID team workers, trucks, and equipment. To allow these cleanup events to be scalable and successful, the creation of an official City program is necessary.

Infrastructure and staffing must be in place. The program would require application intaking, staffing and equipment coordination, overtime, supply procurement, inventory

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management, and capacity planning. RRR is currently unable to support such a program due to budget and staffing constraints.

If the proposed rate increases are approved and the BIID response team is right-sized, the team would be able to support a new CCP program in addition to their routine alley cleanup duties. The CCP program would be piloted at a quarterly frequency.

Offset with a Reduction of 2.88 FTE As-Needed Maintenance Assistants Staffing offset: Minus 4 Maintenance Assistant vacancies (-2.88 FTE) To offset the staffing requirement and budgetary impact from the five actions above, staff proposes eliminating four existing vacant as-needed Maintenance Assistant positions (equivalent to 2.88 FTE). It has been challenging to fill these four vacancies because the job is physically demanding and as-needed positions do not offer benefits therefore making the opportunities less competitive.

Table 4. Services Included in the Proposed Rates – Option One, Enhanced Clean & Safe Services Customer
Type
Landfill Trash
(Black
Container)
Collection &
Disposal
Recyclables
(Blue
Container)
Collection &
Recycling
Organics
(Green
Container)
Collection &
Composting
Bulky Item
Pickup and
Illegal
Dumping
Cleanup
Weekly
Street
Sweeping
On-Demand
Door-to-Door
HHW
Collection
Access to
Monthly
Recycling
Events and
Zero Waste
Programs
Enhanced
Bulky Item
Illegal
Dumping
Response &
Alley
Cleanup
Quarterly
Community
Cleanup
Program
SingleFamilyIncluded Included Included Included Included Included Included Included Included MultiFamilyIncluded Included Included Included Included Included Included Included Included Commercial Included Included Included Included Included No Partial Included Included Option Two: Right-Size Basic Services
Option Two would right-size basic services to align with core needs only. Under Option Two, rates would still need to be restructured in year one to accurately account for the true costs of services provided and align the fee structure with the best management practices of the industry. The remaining four years of the rate study would then apply a consistent 10.2% annual increase to all services evenly.

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Table 5. Proposed Rates of Typical Services for Option Two, Including Annual Change in Rate in Dollar and Percentage Customer Type Current
FY 2022-23
Monthly
Proposed
FY 2023-24
Monthly
Proposed
FY 2024-25
Monthly
Proposed
FY 2025-26
Monthly
Proposed
FY 2026-27
Monthly
Proposed
FY 2027-28
Monthly
Single-Family
One (1) 65-gallon 1x
per week
$41.78 $46.04
+$4.26

10.2%
$50.73
+$4.70

10.2%
$55.91
+$5.18

10.2%
$61.61
+$5.70

10.2%
$67.89
+$6.29

10.2%
One (1) 95-gallon 1x
per week
$53.90 $59.39
+$5.50

10.2%
$65.45
+$6.06

10.2%
$72.13
+$6.68

10.2%
$79.48
+$7.36

10.2%
$87.59
+$8.10

10.2%
Multi-Family
Four-Unit Apartment
Two 95-gallon 1x per
week
$99.28 $118.78
+$19.50

19.6%
$130.90
+$12.12

10.2%
$144.25
+$13.35

10.2%
$158.96
+$14.71

10.2%
$175.17
+$16.21

10.2%
Ten-Unit Apartment
One 300-gallon 2x per
week
$222.58 $272.30
+$52.42

23.6%
$300.05
+$28.05

10.2%
$331.26
+$30.91

10.2%
$365.32
+$34.06

10.2%
$402.86
+$37.54

10.2%
Commercial
Small Retail
One 95-gallon 1x per
week
$88.21 $56.69
-$31.52
-35.7%
$62.75
+$6.06

10.7%
$69.43
+$6.68

10.6%
$76.78
+$7.36

10.6%
$84.89
+$8.10

10.6%
Mid-size Retail
One 2-cubic-yard 1x
per week
$131.34 $154.69
+$23.36

17.8%
$170.75
+$16.06

10.4%
$188.44
+$17.69

10.4%
$207.93
+$19.50

10.3%
$229.42
+$21.49

10.3%
Option Two includes an additional 8.12 FTE employees to keep up with current collection and sweeping service demand and to meet new State and local regulatory compliance in organics recycling. Without these positions, sanitation services would continue to degrade over time as demands continue to rise.

However, Option Two would not provide for the staffing needed to enhance RRR’s current bulky item, illegal dumping, and alley cleanup response. While Option One would provide the necessary resources to deploy proactive, recurring weekly alley cleanup services, Option Two would maintain the current service model of responding only to bulky item collection and illegal dumping locations reported through 311 as staffing allows. Additionally, Option Two would not provide for the staff capacity to support a quarterly Community Cleanup Program (CCP).

Table 6. Services Included in the Proposed Rates – Option Two, Right-Size Basic Services

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Customer
Type
Landfill Trash
(Black
Container)
Collection &
Disposal
Recyclables
(Blue
Container)
Collection &
Recycling
Organics
(Green
Container)
Collection &
Composting
Bulky Item
Pickup and
Illegal
Dumping
Cleanup
Weekly
Street
Sweeping
On-Demand
Door-to-Door
HHW
Collection
Access to
Monthly
Recycling
Events and
Zero Waste
Programs
Enhanced
Bulky Item
Illegal
Dumping
Response &
Alley
Cleanup
Quarterly
Community
Cleanup
Program
SingleFamilyIncluded Included Included Included Included Included Included No No MultiFamilyIncluded Included Included Included Included Included Included No No Commercial Included Included Included Included Included No Partial No No Rate Comparisons: 2023-2028
Tables 3 and 5 summarize the current and proposed FY 2023-28 rates of the most commonly subscribed collection service levels for single-family customers, multi-family customers, and commercial customers under Option One – Enhanced Clean and Safe Services, and Option Two – Right-Size Basic Services, respectively. These two tables show a small snippet of the dozens of service subscription levels RRR offers, from one 65-gallon container serviced once a week to multiple 4-cubic-yard containers serviced seven days a week. The full list of proposed rates can be found in Attachment F. Tables 4 and 6 show the RRR services that are included under Option One versus Option Two.

Essentially, the proposed rate difference between Option One and Option Two equate to less than 1% or $1-$3 per month for many customers, but Option One provides the substantially enhanced clean and safe services at a minimal additional cost. The rate difference will vary based on individual customers.

Single-Family Rates
Residents who reside in single-family houses may choose to have either 65-gallon black landfill trash carts or 95-gallon trash carts. Blue recycling cart and green organics cart services are included in the bundled rate at no additional cost. Most single-family customers opt to have one 95-gallon trash cart with once-a-week collection service.

Under Option One, single-family customers can anticipate a rate increase ranging from $5-$9, depending on the chosen service level. Under Option Two, single-family customers can anticipate an increase ranging from $4-$8 over the five-year span.

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Multi-Family Rates
Service subscription levels vary widely in the multi-family customer sector based on the size and needs of the building. Although some very large apartment buildings exist, most multi-unit dwellings and rent control apartment buildings in the City have ten or less units. In either rate option, the year one proposed increase is greater than the following years because of the rate restructuring required to eliminate the livable unit charges and fold in street sweeping services into one bundled solid waste and recycling rate for multi-family customers. Including street sweeping into one bundled solid waste and recycling rate ensures the overall rate structure is consistent among all customer types and modernizes the City’s solid waste rate structure to align with industry standards.

Under Option One, a typical four-unit apartment with two 95-gallon landfill trash carts with once a week collection could see a rate restructuring adjustment of $20 ($5 per unit) in year one and approximately $13-$18 (or $3.29-$4.50 per unit) in years two through five. Under Option Two, the same four-unit apartment could see a rate restructuring adjustment of $20 ($5 per unit) in year one and $12-$16 ($3-$4 per unit) in the out years.

Under Option One, a ten-unit apartment who chooses to have one 300-gallon trash cart with twice a week collection could anticipate a similar per-unit rate increase for a total of $52 ($5.20 per unit) for the entire building in year one, followed by $30-$41 ($3-$4 per unit) in the subsequent years. Under Option Two, the same ten-unit apartment could anticipate a rate restructuring adjustment of $52 in year one ($5.20 per unit), followed by $28-$38 ($2.80-$3.80 per unit) in the following years.

Commercial Rates
Similar to the multi-family rates, all commercial rates require rate restructuring in year one to eliminate street sweeping charges by water meter size and fold in sweeping service into one bundled solid waste and recycling rate to align with industry best practice. As rates are normalized, some small businesses could see savings in year

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one, with subsequent year increases at the same level of single-family homes subscribing to the same service.

There is a great level of rate impact variability in the business community based on the size, nature, and needs of the business. A small business might choose to have one 95- gallon trash cart with once-a-week collection, while large supermarkets and hotels might prefer multiple 4-cubic-yard trash bins with seven-day-a-week collection. Rates are based on the level of service required. The more trash a business generates, the higher the rate will be.

Staff analysis found most commercial customers in the City to be small to medium-sized businesses. Some of the smallest businesses, such as small retail shops, professional offices, or hair salons with one 95-gallon trash cart serviced once a week could potentially anticipate a monthly rate reduction of $31 in year one due to rate restructuring and a nominal increase of $7-$9 in subsequent years under Option One.

Under Option Two, the same small business could see a saving of $32 in year one, followed by an increase of $6-$8 in the out years.

Medium sized businesses that require more service, such as cafes and fitness studios, could expect an upward monthly adjustment of $23 in year one and $17-$24 in the following years under Option One. The same medium sized business could see the same $23 rate restructuring adjustment in year one and an increase of $16-$21 in years two through five under Option Two.

Conclusion
Staff recommends rate adjustment proposal Option One, which would allow RRR to stabilize the RRR Enterprise Fund and maintain fiscal solvency, right-size the staffing level to meet current community needs, provide faster and better customer service, and make meaningful progress towards SB 1383 regulatory compliance as well as the Council’s Zero Waste by 2030 sustainability goal. Option One would create permanent jobs, encourage volunteerism and community involvement in co-creating a cleaner, safer, and more sustainable City, while still protecting rent control buildings and

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businesses as the City’s multi-family and commercial solid waste rates would continue to be ranked among the lowest of all 88 cities in Los Angeles County.

Figure 7. Comparison of Monthly Solid Waste Rates (FY 2023-24 Projected) Option One yields many more positive improvements to the community at a minimal increased cost, including:

1. The rate difference between Option One (Enhanced) and Option Two (Basic) is only less than 1% or less than $3 per month for many customers.

2. As shown in Figure 7, the City’s Option One proposed rates compare well to those in other cities in Los Angeles County. The proposed single-family rates might be slightly higher than some cities, but the City provides more white-glove services to its residents as demonstrated in Table 1, including monthly recycling events and on-demand HHW pickup.

3. Figure 7 exhibits that the City’s proposed multi-family and commercial rates are still considerably lower than most other cities even after the proposed increase under Option One. Option One rates support the City’s desire to protect rentcontrolled buildings, protect small businesses, and aid economic recovery.

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4. The ability to deploy rapid response to increasing community needs for a clean and safe City. Restoration of a fully staffed BIID response team allows for proactive alley cleanup and illegal dumping collection services five days a week, instead of reactively responding to 311 requests.

5. Shorter bulky item collection response time, quicker replacement of stolen/broken containers, and faster delivery of new organics containers. The latter drives the City’s ability to comply with the State’s SB 1383 mandate.

6. Cleaner neighborhoods and less opportunities for discarded items to cause undesirable behaviors, such as scavenging.

7. Creation of a new City-supported CCP that encourages volunteerism. The CCP pilot allows resident volunteers to be part of the collaborative efforts to create a cleaner city and make a direct positive change in their own neighborhood.

8. Considering the three years of rate freeze from 2020-23 where the rates stayed stagnant, the average annual ten-year increase from 2017-28 is 6.3% for Option One (Enhanced) and 6% for Option Two (Basic). That annual adjustment compares favorably with industry standards, especially given changes in the recycling market in the last few years, new unfunded State mandates, inflation impacts, and the wide variety and high level of service provided by the City.

Under both rate adjustment options presented in this report, many single-family solid waste customers can anticipate an annual rate increase of $4-$9 per month, multifamily customers $20-$52 in 2023 and $12-$41 in the following years, and commercial customers ranging from a reduction of $31 to an increase of $23 in year one and an increase of $7-$24 in the subsequent years.

It is important to note that solid waste ratepayers can choose from a wide menu of service subscription levels, thus the actual rate impact will vary widely based on the customer’s service needs. Most customers will see an increase in their solid waste rates, while others may see a decrease due to rate restructuring. The estimates cited above represent rate impacts for the most commonly subscribed service levels, but there will be more variations in the multi-family and commercial customer sectors due to the varying sizes and needs of these buildings.

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Alternatives
It is paramount that the City implement a rate increase in early FY 2023-24 after a three-year rate freeze. Not implementing a rate increase is not a feasible option as the RRR Enterprise Fund would run out of money and become unable to sustain the City’s solid waste and recycling services beginning in early FY 2024-25. Staff’s recommended Option One (Enhanced Clean and Safe Services) requires an annual increase of 11% and results in an additional 15.12 FTE in staffing. Rate adjustment Option Two (RightSize Basic Services) requires an annual increase of 10.2% and results in an additional

8.12 FTE. A minimum 9% annual increase would still be required to stabilize the RRR Fund even with no new added services or staffing. Staff does not recommend this as the current staffing shortages are unsustainable in the long run, leading to continued degradation of the City’s cleanliness, increased response times, and an overall reduction in customer service levels. Table 7 summarizes the two proposed rate options and the alternative outcome.

Table 7. Rate Option Summary
Option Additional
Staffing
Level
Proposed
Annual
Increase
Anticipated Outcome
One – Enhanced Clean and Safe
Services (RECOMMENDED)

15.12 FTE 11% Enhanced bulky item illegal dumping collection Proactive weekly alley cleanup
Quarterly community cleanup program
Two – Right-Size Basic Services 8.12 FTE 10.2% Right-Size Existing Basic Services No enhanced bulky item illegal dumping collection
No quarterly community cleanup program
Alternative (NOT RECOMMENDED) 0 FTE 9% Staffing shortages persist Missed or delayed collections continue
City’s cleanliness degrades
Ways to Keep Rates Down
As demonstrated throughout this report, the 2023 rate study aims to achieve the following:
• Keep solid waste rate increases moderate despite the three-year rate freeze by deploying reserves; and

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• Enhance RRR services.

In addition, as described below, there are different ways to minimize the impacts of proposed rate increases.

Customers Can Right-Size Service Subscription Level
The City incentivizes landfill diversion and recycling by offering a bundled solid waste and recycling rate structure based on the number, size, and service frequency of the black landfill trash container(s) only. There are no separate charges for servicing or requesting additional blue recycling containers and green organics containers. The solid waste rate is based on a customer’s chosen level and frequency of service required.

The more landfill trash a customer generates, the more RRR services are required, and the higher the rate will be. As RRR continues to roll out green organics containers to every neighborhood, residents and businesses have an opportunity to assess their consumption habits, find ways to generate less landfill trash by reducing waste, and recycle and compost more in the blue and green containers. By diverting and recycling some of the materials previously discarded in the black landfill trash container to the blue and green containers, a customer might find they no longer require the number, size, and/or service frequency of the black trash container they previously chose. Rightsizing service level and reducing landfill trash disposal not only lowers one’s utility bill, it also reduces methane gas emission at the landfill and dramatically helps the City achieve its Zero Waste by 2030 goal.

Create a Solid Waste Rate Discount Program

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The City Council is being asked to support creating a new solid waste rate discount program, which does not currently exist. The City has a water utility rate low-income discount program for income-qualified customers that are enrolled in the California Alternate Rates for Energy (CARE) program offered by Southern California Edison and the Southern California Gas Company. Proposition 218 mandates that utility discounts be covered by funding sources outside of the utility enterprise fund. Accordingly, the Water Fund received a total amount of $154,930 in General Fund subsidy to fund the program in 2022, which benefited 447 customers.

If directed by the City Council to create a solid waste rate discount program, staff would explore viable funding options, develop program criteria and duration, and report back to the Council at the June 2023 rate adoption public hearing.

Next Steps and Public Outreach
Staff seeks comments from Council regarding Option One and Option Two of the rate adjustment scenarios. Staff also seeks direction from Council about the creation of a solid waste rate discount pilot program for residents with eligibility. Staff will incorporate Council comments from this meeting into the final rate study while public outreach commences.

RRR staff has planned a robust community outreach calendar to share information of the rate study findings, develop community understanding of the need for rate adjustments to maintain high quality solid waste and recycling services, and provide an update on the City’s zero waste progress and programming that is funded by solid waste utility rates. As part of the public outreach, from February through April staff will be meeting with all key business stakeholder organizations, neighborhood associations, and the Commission on Sustainability, Environmental Justice, and the Environment.

In late April, the City will mail a public notice outlining the proposed rate changes to all property owners and utility account holders at least 45 days prior to the public hearing date. Absent a majority protest, Council may approve the final adoption of the rates at

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the public hearing in June 2023. The new rates would take effect starting August 1, 2023.

Environmental Review
No environmental review under CEQA is required at this time since this study session on solid waste rates will not result in direct or indirect physical changes in the environment.

Financial Impacts and Budget Actions
There are no immediate financial impacts or budget actions necessary at this study session. If Council approves staffing changes and/or the creation of a solid waste rate discount program, staff will return later to seek specific budget actions.

Finally, staff will incorporate Council’s comments from this meeting into the calculation of the potential total financial impact to the RRR Enterprise Fund and present it in the staff report and rate adoption meeting. If new rates are approved by Council in June 2023, the new rates would be effective on August 1, 2023, and annually on the first day of the fiscal year on July 1, 2024, through July 1, 2027 (FY 2023-28).

Prepared By: Yvonne Yeung, Resource Recovery and Recycling Administrator Approved Forwarded to Council
Attachments:

A. Staff Report: Adoption of Solid Waste Rates, 2014 (Web Link) B. Staff Report - Solid Waste Rate Study 3rd Contract Modification (Web Link) C. New York Times Article: "How Cheap 'Fast Furniture' Could Soon Clog Landfills." October 31, 2022
D. 2014 Zero Waste Plan
E. 2019 Zero Waste Plan Update

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F. Draft Report of Santa Monica Five-Year Solid Waste Rate Study, 2023-2028

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1/23/23, 8:57 AM How Cheap ‘Fast Furniture’ Could Soon Clog Landfills - The New York Times https://www.nytimes.com/2022/10/31/realestate/fast-furniture-clogged-landfills.html 1/4 https://www.nytimes.com/2022/10/31/realestate/fast-furniture-clogged-landfills.html Fast Furniture’ Is Cheap. And Americans Are Throwing It in the Trash.

The mass-produced furniture that sold furiously during the pandemic could soon be clogging landfills.

By Debra Kamin
Published Oct. 31, 2022 Updated Nov. 2, 2022
To hear more audio stories from publications like The New York Times, download Audm for iPhone or Android.

Americans bought piles of furniture during the pandemic, with sales on desks, chairs and patio equipment jumping by more than $4 billion from 2019 to 2021, according to a market data company. And a lot of it won’t survive the decade.

Fast furniture, which is mass-produced and relatively inexpensive, is easy to obtain and then abandon. Like fast fashion, in which retailers like Shein and Zara produce loads of cheap, trendy clothing that’s made to be discarded after only a few wears, fast furniture is for those looking to hook up but not settle down. It’s the one-season fling of furnishings.

Many of the Ikea beds and Wayfair desks bought during the Covid-19 lockdown were designed to last about five years, said Deana McDonagh, a professor of industrial design at the University of Illinois, Urbana-Champaign. “I relate to fast furniture like I do to fast food,” Ms. McDonagh said. “It’s empty of culture, and it’s not carrying any history with it.” Ikea of Sweden said in a statement that “life span estimation may vary” for its furniture, and customers are encouraged to repair, resell or return products they can no longer use. Wayfair said through a spokesperson that “we sell an extensive range of furniture products across all styles and price points,” adding that some are meant to “last for generations as well as furniture that meets customer needs for affordability.”
Increasingly, renters and homeowners are opting for fast and cheap, or as Amber Dunford, style director at Overstock.com, defines it, “furniture where the human hand is missing.” And they don’t keep it long. Each year, Americans throw out more than 12 million tons of furniture, creating mountains of solid waste that have grown 450 percent since 1960, according to the Environmental Protection Agency.

Bits of tossed furniture can be recycled, but the vast majority ends up in landfills. “It’s quite a big problem, both spatially and also because of the way a lot of fast furniture is made now, it’s not just wood and metal. The materials don’t biodegrade or break down,” said Ashlee Piper, a sustainability expert and the author of “Give a Sh*t: Do Good. Live Better.

Save the Planet.” “We’re creating this Leviathan problem at landfills with the furniture that we get rid of.” The e-commerce furniture market alone was worth more than $27 billion in 2021, and projected to reach more than $40 billion by 2030, according to a report from Next Move Strategy Consulting. Ikea is opening an average of 50 new locations per year; Amazon, the world’s largest retailer, now has two private-label furniture brands, the midcentury-modern Rivet and the more farmhouse-chic Stone & Beam.

For all of its flaws, fast furniture offers millions of homeowners the opportunity to live in a stylish home at an affordable price point. As young people contend with skyrocketing housing prices and economic anxiety, even those who would prefer to browse antique markets or shop for custom pieces simply don’t have the resources to do so.

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Packet Pg. 353 Attachment: New York Times Article: "How Cheap 'Fast Furniture' Could Soon Clog Landfills." October 31, 2022 (5616 : Solid Waste Rate 1/23/23, 8:57 AM How Cheap ‘Fast Furniture’ Could Soon Clog Landfills - The New York Times https://www.nytimes.com/2022/10/31/realestate/fast-furniture-clogged-landfills.html 2/4 Sebastien Long founded Lodgeur, which rents short-term furnished apartments in Texas, in 2019. He does the design for the apartments in-house, and relies almost exclusively on retailers like Wayfair, Target, West Elm and CB2. “We do this because of fast turnaround times required on many of our projects, but also because we’re able to create stylish and comfortable apartments,” he said. The durability of the furniture doesn’t concern him much, he added, because of his business model. “Fast furniture is more likely to get damaged when you move it around in a U-Haul,” he said. “That’s why we leave it inside the apartment and instead move people in and out.”
But even for those who swore they’d never bring low-end furniture in their homes, necessity can be the mother of exception. During the pandemic, Georgia Zikas, owner of Georgia Zikas Design, worked with a client in New Jersey, furnishing and decorating a multi-milliondollar house that would be used as their second home. They closed in November 2020 and wanted to be able to use the backyard pool by spring, but global production and shipping bottlenecks meant that custom-made furniture pieces were delayed by months. “They had a deadline,” Ms. Zikas said. “So I went to one of my designers and was like: ‘What can we have in eight weeks?’” The entire home was outfitted with ready-to-ship pieces from Pottery Barn, Crate & Barrel and Ethan Allen, vendors that have higher price points, use higher-quality materials and all have sustainability pledges. But environmentalists like Ms. Piper still consider them fast furniture because their pieces are mass produced. It was a choice, said Ms. Zikas, that a few years ago might have surprised her. But since the pandemic, and its ripple effect on the global supply chain, all bets are off. “It’s definitely affecting where we’re shopping,” she said.

Sometimes, however, homeowners have a change of heart. Doug Greene, 34, bought a 200-year-old rowhouse in Philadelphia five years ago, and after doing a gut renovation, found he didn’t want to bring mass-produced furniture into a space he’d so painstakingly restored.

So he taught himself how to make furniture, and he and his girlfriend, Ashley Hauza, now have a home where he handcrafted nearly every stick of furniture from solid wood. There’s a western red cedar waterfall bench. There’s a white oak bed frame with a hand-cut bridle joint.

Environmentalists say landfills are becoming clogged with the mass-produced “fast furniture” that consumers discard. Pieces of furniture, above, that were thrown away with the garbage on the streets of the Upper East Side of Manhattan in 2021. Jutharat Pinyodoonyachet for The New York Times Doug Greene bought a 200-year-old rowhouse in Philadelphia, but after a gut renovation, decided he didn’t want to fill it with mass-produced furniture. Steve Legato for The New York Times

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Packet Pg. 354 Attachment: New York Times Article: "How Cheap 'Fast Furniture' Could Soon Clog Landfills." October 31, 2022 (5616 : Solid Waste Rate 1/23/23, 8:57 AM How Cheap ‘Fast Furniture’ Could Soon Clog Landfills - The New York Times https://www.nytimes.com/2022/10/31/realestate/fast-furniture-clogged-landfills.html 3/4 “It’s all much more solid pieces of furniture than anything I could have picked up from a store on a shelf,” he said. “I used to pick up an Ikea desk every time I switched apartments. I just thought that was the way people did it. I now have a much greater appreciation for creativity and design.”
Over the past decade, a number of sustainability-focused companies have entered the market in the hopes of presenting a solution.

Kaiyo, an online marketplace for pre-owned furniture, was founded in 2014 and says it has since kept more than 3.5 million pounds of furniture out of landfills. Those with furniture to unload can offer it to Kaiyo, and if the company accepts — Alpay Koralturk, the chief executive, said the company purchases about half of the pieces offered to them — it’ll get picked up for free and the seller will get a check.

Buyers can shop the online marketplace, and know that items shown online are always in stock. “Everyone has a ton of furniture. Few products are as ubiquitous,” Mr. Koralturk said. “I was trying to imagine what the 21st century solution should be.”
Fernish, a rental furniture subscription service, allows customers to pay month-to-month for items from brands like Crate & Barrel, always with the option to buy outright. The service says it has saved more than 1 million pounds of furniture from landfills. “We recognize that furniture is generally an unrecyclable good,” said Michael Barlow, Fernish’s chief executive. “The way to give it a second life is to put very quality product into circulation in the first place, and build a supply chain,” he said. “The demographic that we’re built for is people in their 20s and 30s.”
Major retailers, facing pressure from customers and environmentalists, are also saying they’ll do better.

Wayfair, which saw sales deflate this summer after a pandemic boom, pledged in its most recent corporate responsibility report to reduce greenhouse gas emissions — mainly created by the production and shipment of its products — by 63 percent by 2035. “We don’t claim to have everything figured out, but we’re working to address big problems and set strategies with an approach that’s true to Wayfair,” founders Niraj Shah and Steve Conine wrote in the report.

And Ikea has laid out bold climate goals in its sustainability strategy, vowing to become fully circular — using only recycled or renewable materials, and creating zero waste — by 2030.

One of Mr. Greene’s pieces is a waterfall bench made from western red cedar. Steve Legato for The New York Times

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Packet Pg. 355 Attachment: New York Times Article: "How Cheap 'Fast Furniture' Could Soon Clog Landfills." October 31, 2022 (5616 : Solid Waste Rate 1/23/23, 8:57 AM How Cheap ‘Fast Furniture’ Could Soon Clog Landfills - The New York Times https://www.nytimes.com/2022/10/31/realestate/fast-furniture-clogged-landfills.html 4/4 “Keeping prices low is a cornerstone of our business,” Ikea of Sweden said in a statement. “But this must never come at the expense of people and the environment.”
In the 2021 fiscal year, more than 99 percent of their wood was either recycled or certified by the Forest Stewardship Council as being sourced responsibly, the company said. Fourteen percent was fully recycled.

The impact of fast furniture, Ms. Piper said, is a hard sell to even the most economically-conscious people. But she’s optimistic that change is possible.
“You have elements of sustainability that are sexier to people, and are more the gateway drug to sustainability, like fast fashion,” she said.

But if Ikea can do it, “and they’re willing to share how they do it with other companies, that’s really encouraging.” Audio produced by Tally Abecassis.

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Packet Pg. 356 Attachment: New York Times Article: "How Cheap 'Fast Furniture' Could Soon Clog Landfills." October 31, 2022 (5616 : Solid Waste Rate city of santa monica
zero waste strategic operations plan
Attachment 1

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Packet Pg. 357 Attachment: 2014 Zero Waste Plan (5616 : Solid Waste Rate Study)

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zero waste strategic operations plan

DRAFT
Zero Waste Strategic Operations Plan
Prepared for:

City of Santa Monica
Public Works Department
Resource Recovery & Recycling
2500 Michigan Avenue
Santa Monica, CA 90404
Prepared by:
.
251 South Lake Avenue, Suite 1000
Pasadena, CA 91101
626-584-1700
In conjunction with:
19200 Von Karman Avenue, Suite 360
Irvine, California 92612
(949) 251-8628
January 2013

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Contents

1.0 Introduction................................................................................................................................................. 1-1

1.1 Background ...................................................................................................................................................................................... 1-1

1.1.1 What Is Zero Waste? ........................................................................................................................................................... 1-2

1.2 Guiding Principles ......................................................................................................................................................................... 1-2

1.3 Zero Waste Policy .......................................................................................................................................................................... 1-4

1.4 Goal Areas, Goals, Indicators and Targets .......................................................................................................................... 1-4

2.0 Current Conditions .................................................................................................................................... 2-7

2.1 Resource Recovery and Recycling Division ....................................................................................................................... 2-7

2.1.1 Residential Collection Services ...................................................................................................................................... 2-7

2.1.2 Commercial Collection Services .................................................................................................................................. 2-15

2.1.3 Household Hazardous Waste ....................................................................................................................................... 2-18

2.1.4 Zero Waste Events ............................................................................................................................................................ 2-20

2.2 City Policies and Programs ..................................................................................................................................................... 2-20

2.2.1 Santa Monica Municipal Code (SMMC) .................................................................................................................... 2-20

2.2.2 Extended Producer Responsibility ............................................................................................................................ 2-24

2.2.3 Recycled Products Procurement Policy .................................................................................................................. 2-24

2.2.4 Sustainable City Plan ....................................................................................................................................................... 2-25

2.2.5 Green Business Certification Program ..................................................................................................................... 2-26

2.2.6 Sustainable Quality Awards .......................................................................................................................................... 2-27

2.2.7 US Conference of Mayors/California Public Interest Research Group (CALPIRG) Buy Recycled Campaign ...................................................................................................................................................................... 2-27

2.2.8 City’s Purchase and Use of Tropical Forest Wood Products .......................................................................... 2-27

2.2.9 Print Shop Purchasing Policy ....................................................................................................................................... 2-27

2.2.10 Electronic Waste ............................................................................................................................................................. 2-27

2.2.11 Used Oil and Filter Collection .................................................................................................................................... 2-27

2.2.12 Christmas Tree Recycling ........................................................................................................................................... 2-27

2.2.13 Catalogue Choice ............................................................................................................................................................. 2-29

2.2.14 Scheduled Events ............................................................................................................................................................ 2-29

2.3 Resource Recovery and Recycling Processing Facilities ........................................................................................... 2-29

2.3.1 Santa Monica Community Recycling Center.......................................................................................................... 2-29

2.3.2 Southern California Disposal Transfer Station .................................................................................................... 2-30

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2.4 Educational Outreach................................................................................................................................................................ 2-30

2.4.1 Sustainable Works ............................................................................................................................................................ 2-30

2.4.2 Community Sustainability Liaison ............................................................................................................................. 2-31

2.4.3 Educational Outreach Tools ......................................................................................................................................... 2-31

2.4.4 Educational Outreach Events ....................................................................................................................................... 2-32

3.0 Generation and Characterization......................................................................................................... 3-1

3.1 Existing Generation....................................................................................................................................................................... 3-1

3.2 Waste Diversion ............................................................................................................................................................................. 3-1

3.3 Disposal .............................................................................................................................................................................................. 3-3

3.4 Discarded Materials Characterization .................................................................................................................................. 3-3

3.4.1 Methodology ........................................................................................................................................................................... 3-3

3.4.2 Single-Family Residential Waste Composition ....................................................................................................... 3-5

3.4.3 Multi-Family Residential ................................................................................................................................................... 3-6

3.4.4 Commercial ............................................................................................................................................................................. 3-7

3.4.5 Self-Haul ................................................................................................................................................................................... 3-8

3.5 Disposal Projections ..................................................................................................................................................................... 3-9

3.5.1 Population Projections....................................................................................................................................................... 3-9

3.5.2 Future Disposal ..................................................................................................................................................................... 3-9

4.0 Zero Waste Options ................................................................................................................................... 4-1

4.1 Initial List of Potential Options ................................................................................................................................................ 4-1

4.2 Recommended Strategies .......................................................................................................................................................... 4-5

4.2.1 Mandatory ............................................................................................................................................................................... 4-5

4.2.2 Collection ................................................................................................................................................................................. 4-6

4.2.3 Rate Setting .......................................................................................................................................................................... 4-10

4.2.4 Upstream ............................................................................................................................................................................... 4-11

4.2.5 Downstream ........................................................................................................................................................................ 4-13

4.2.6 Facilities ................................................................................................................................................................................ 4-16

5.0 Diversion and Greenhouse Gas Emissions Reduction Estimates .............................................. 5-1

5.1 Diversion Estimates ...................................................................................................................................................................... 5-1

5.2 Greenhouse Gas Emissions Reduction Estimates ............................................................................................................ 5-3

6.0 Financial and Cost Analysis .................................................................................................................... 6-1

6.1 Financial Analysis .......................................................................................................................................................................... 6-1

6.2 Cost Analysis .................................................................................................................................................................................... 6-4

6.3 Customer Rate Impact Analysis .............................................................................................................................................. 6-5

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6.4 Program Impact Observations ................................................................................................................................................. 6-7

7.0 Implementation .......................................................................................................................................... 7-1 Exhibits
Exhibit 2-1. Map of SF Residences Participating in the Pilot Food Scraps Collection Program ........................... 2-12 Exhibit 2-2. Used Oil and Oil Filter Collection Locations ....................................................................................................... 2-28 Exhibit 3-1. Single Family Residential Disposed Waste Composition ................................................................................ 3-5 Exhibit 3-2. Multi-Family Residential Disposed Waste Composition ................................................................................. 3-6 Exhibit 3-3. Commercial Disposed Waste composition- Percentages ................................................................................ 3-7 Exhibit 3-4. Self-Haul Disposed Waste Composition Percentages ....................................................................................... 3-8 Exhibit 7-1. Implementation Schedule ............................................................................................................................................. 7-2 Tables
Table 1-1. Goal Areas, Indicators and Targets ................................................................................................................................ 1-5 Table 2-1. Residential Tonnages (2011) .......................................................................................................................................... 2-7 Table 2-2. Items Accepted in the City’s Recycling Program ................................................................................................. 2-10 Table 2-3. Bi-Monthly Single-Family Residential Collection Rates ................................................................................... 2-11 Table 2-4. Bi-Monthly Multi-Family Residential Collection Rates ................................................................................... 2-14 Table 2-5. Commercial Tonnages (2011) ..................................................................................................................................... 2-15 Table 2-6. Bi-Monthly Commercial Collection Rates (FY 2011/2012) .......................................................................... 2-17 Table 2-7. Materials accepted at the City’s HHW Center ....................................................................................................... 2-19 Table 2-8. Approved C&D Recycling Facilities ........................................................................................................................... 2-23 Table 2-9. City-Approved Mixed C&D Recycling Facilities ................................................................................................... 2-24 Table 2-10. 2010 Sustainable Report Card Grades .................................................................................................................. 2-26 Table 2-11. Educational Outreach Media ..................................................................................................................................... 2-31 Table 2-12. Citywide Environmental Events .............................................................................................................................. 2-32 Table 3-1. Overall Generation 2011 (tons) ..................................................................................................................................... 3-1 Table 3-2. 2011 Diversion Summary ................................................................................................................................................. 3-2 Table 3-3. 2011 Disposal Summary (tons) ..................................................................................................................................... 3-3 Table 3-4. Composition by Material Category and Generator Sector ................................................................................. 3-4 Table 3-5. Population Forecasts (2010-2030) .............................................................................................................................. 3-9

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Table 3-6. Waste Disposal Projections (2013-2030), Tons .................................................................................................. 3-10 Table 5-1. Diversion Estimates by Implementation Phase ...................................................................................................... 5-1 Table 5-2. Zero Waste Strategic Plan Diversion Estimates ..................................................................................................... 5-2 Table 5-3. Zero Waste Strategic Plan Greenhouse Gas Emissions Estimates (MTCE) ................................................ 5-3 Table 6-1. Solid Waste Program Baseline Analysis – All Sectors ................................................................................................ 6-2 Table 6-2. Solid Waste Program Baseline Analysis – Single Family Sector ...................................................................... 6-2 Table 6-3. Solid Waste Program Baseline Analysis – Multi-family Sector ........................................................................ 6-3 Table 6-4. Solid Waste Program Baseline Analysis – Commercial Sector ......................................................................... 6-3 Table 6-5. Planning-Level Cost Estimates for Selected Zero Waste Programs ............................................................... 6-5 Table 6-6. Customer Rate Impacts for Selected Zero Waste Programs ............................................................................. 6-6 Table 6-7. Most Cost Effective Zero Waste Programs Based on Incremental Annual Program Savings ............. 6-7 Table 6-8. Programs with Net Cost Increases Sorted by Lowest to Highest Cost Per Ton ........................................ 6-8 Appendices
A. Waste Characterization Analysis
B. Population Projections
C. Summary List of Recommended Strategies
D. Diversion Potential by Option
E. Greenhouse Gas Emissions Assumptions and Calculations F. City Solid Waste Revenue and Expense Data
G. Planning Level Cost Estimates
H. List of Plan Contributors and Preparers

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1.0 INTRODUCTION
1-1

1.0 Introduction

1.1 Background
The City of Santa Monica prides itself on being an environmental leader. It’s Resource Recovery and Recycling Division (RRR) and Office of Sustainability and the Environment (OSE) have implemented many cutting edge environmental initiatives and programs. The City’s state-of-the-art waste diversion strategies contributed to the City reaching a 74% diversion rate in 2009. As another indicator of the City’s diversion accomplishments, the City’s calculated per capita disposal rate in 2010 was 3.6 pounds per person per day, well below the targeted rate of

10.9 pounds per person per day. The per capita disposal target, as established by CalRecycle, is the amount of disposal that is approximately equivalent to the 50 percent diversion requirement, and represents an average of 50 percent of total waste generation in 2003 through 2006 expressed in terms of per capita disposal
On June 23, 2009, the City Council directed staff to develop a Zero Waste Strategic Plan. The creation of the Plan would allow the City to strengthen and refine its current waste diversion operations while adding significant opportunities and emerging technologies. The City established the Zero Waste Planning Committee to effectively design and implement a zero waste program. This Committee was comprised of the Resource Recovery & Recycling Division (RRR), the Office of Sustainability and the Environment (OSE) and the City’s private partners, Southern California Disposal and Allan Company. Numerous meetings were held between September 2009 and August 2010 to establish methodologies to develop a Zero Waste Strategic Plan. Out of this collaborative effort, several processes and programs were discussed and implemented including a pilot residential yard trimmings and food scraps program, expansion of the commercial food scraps program, and audits of landfills to determine diversion rates.

In addition, the committee determined that a consultant would be needed to develop a long term Zero Waste Strategic Plan which would include identifying new and expanded operational programs, including producer responsibility, product stewardship, client responsibility, council ordinances and resolutions as well as identifying impacts of all programs on future materials processing requirements and disposal rates. A Request for Proposals for a consultant was issued in June 2011, and in December 2011, the City began a Zero Waste Strategic Planning process to identify the new policies, programs and infrastructure that will enable the City to reach its Zero Waste goal of 95% diversion by 2030, or a per capita disposal rate of 1.1 pounds per person per day. The Zero Waste Strategic Operations Plan will help the City strengthen its existing diversion operations while addressing significant fiscal challenges and emerging trends and technologies. The Plan will serve as a broad environmental and policy framework and will guide the future development of the City’s resource recovery and recycling policies, programs, and infrastructure.

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The Zero Waste Strategic Planning process included the following tasks:

1. Review and summary of existing policies, programs, facilities, and rate structure.

2. Review and compilation of existing zero waste guiding principles, and development of zero waste guiding principles relevant to the City.

3. Compilation of existing and projected waste generation and composition data.

4. Identification, evaluation, and selection of policy, program, and infrastructure options.

5. Calculation of potential diversion and greenhouse gas emission reductions.

6. Analysis of program costs and rate structure impacts.

1.1.1 What Is Zero Waste?
Zero waste is a change of perspective. It requires rethinking what we have traditionally regarded as trash and instead treating all materials as valued resources. Zero waste entails shifting consumption patterns, more carefully managing purchases, and maximizing the reuse of materials at the end of their intended use. Zero waste takes into consideration the entire materials management system, from extraction of natural resources, to product design, manufacturing and distribution, to product use and reuse, to recycling, composting, energy recovery, or disposal.

In developing policies, programs and infrastructure to achieve zero waste, the City can both maximize diversion from landfills and reduce generation of waste. Achieving zero waste entails encouraging the City, its residents, businesses, and visitors to reevaluate what we consider waste.

Ultimately, zero waste contributes to the development of a greener local economy and a more sustainable community. In order to reach true sustainability, the strategies identified in the Zero Waste Strategic Operations Plan must consider “People, Planet, and Profit” as the triple bottom line achieving social, environmental, and economic sustainability.

The City has defined it Zero Waste goal to mean achieving 95% diversion or a per capita disposal rate of 1.1 pounds per person per day.

1.2 Guiding Principles
The Santa Monica Zero Waste Strategic Operations Plan (Plan) is based on ten Guiding Principles that provide a framework for the policies, programs and actions identified for implementation. These Zero Waste Guiding Principles are consistent with the Guiding Principles developed for the Santa Monica Sustainable City Plan. The Guiding Principles were presented to the public at the Santa Monica festival in May 2012. Nearly 400 residents provided input during the event. The residents indicated their top three priorities are: healthy community; waste reduction; and education and outreach. The Guiding Principles are detailed below:

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1. The Health of the Community and the Environment Guides all Policy Decisions Santa Monica is committed to protecting, preserving and restoring the natural environment and safeguarding the health of all members of the community. All program and policy decisions related to achieving our zero waste goals will be developed based on these commitments.

2. The Hierarchy for Managing Discarded Materials is to Reduce, Reuse, Recycle and then Recover
The City has adopted an environmental hierarchy for ‘highest and best use’ of discarded materials. It will follow this hierarchy by prioritizing waste prevention and reduction, then encouraging reuse prior to treatment through recycling and composting. The City will recover energy and economic value from residual materials that cannot be recycled or composted through environmentally sound treatment prior to disposal.

3. Economic and Social Benefits are Integral to Zero Waste The programs and policies in this Plan will promote economic benefits, including job creation, cost savings and business opportunities, and will ensure that inequitable burdens are not placed on any one geographic or socioeconomic sector of the population.

4. The City Leads By Example
Santa Monica will model the behavior it seeks from its residents, businesses and institutions by incorporating zero waste principles into local policies and operations; through advocacy for zero waste policies and initiatives at the regional, state and federal level; and through support to the community in striving for zero waste.

5. Brand Owners, Producers and Manufacturers Contribute to the Management of their Products and Packaging
The City will pursue policies at all levels of government (State/ Regional/Local) for producers to take responsibility for the end of life management of products and packaging.

Consumers need to be part of the solution and will be educated on alternative purchasing practices.

6. Regional Partnerships Leverage the City’s Efforts in Pursuing Zero Waste Santa Monica recognizes that to be successful it must work with other cities in the region in order to promote a robust zero waste infrastructure and culture. The City will collaborate on programs, public outreach, legislation, infrastructure and new technologies that help to achieve zero waste goals throughout the region.

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7. Municipal Management of Local Collections and Processing Programs Ensures Local Control and Responsiveness
The City’s operations are a model of materials management. New programs and infrastructure will be developed to ensure that residents, businesses and visitors become zero waste champions.

8. Education, Outreach and Marketing are Essential to Achieving Cultural Change Santa Monica recognizes the power of community-based social marketing, social networks, community organizing and grassroots support for its education and outreach programs. The City will empower the community by providing the tools and techniques for enabling the culture to achieve zero waste.

9. Research and Development of New Technologies, Collection Systems and Infrastructure are Needed to Maximize Diversion of Discarded Materials The City recognizes current approaches to managing materials are inadequate to maximize diversion from disposal. The City will closely monitor new developments and will invest in pilot programs and facilities for achieving zero waste.

10. Local Market Development for Reusable and Recyclable Materials Ensures Sustainability Santa Monica is part of the global economy, but recognizes that local business development is the key to a sustainable community. Wherever possible, the City will invest in local reuse and recycling markets and support local businesses in providing markets for discarded materials.

1.3 Zero Waste Policy
The City will develop a zero waste policy to be adopted concurrent with the adoption of the zero waste strategic operations plan. The policy will establish the City’s goal of reaching zero waste by 2030, and the strategies and actions the City will take to attain that goal. Other aspects of the policy may include the definition of zero waste, specific goals for the residential and commercial sectors, the roles and responsibilities of City departments and divisions, and references to relevant sections of the City’s municipal code, ordinances, and resolutions. The policy will be drafted for review by City staff and legal counsel, and for consideration by the City Council.

1.4 Goal Areas, Goals, Indicators and Targets
The Zero Waste Strategic Operations Plan is organized around six goal areas:

1. Waste Reduction

2. Environmental Benefits

3. Economic Benefits

4. City Leadership

5. Producer Responsibility

6. Zero Waste Culture Change

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Specific goals are established in each goal area representing what Santa Monica must achieve in order to become a zero waste community.

For each goal, indicators have been developed to measure progress toward meeting the goals.

The indicators will help determine the impact of a program, policy or action, and when tracked over time, will reflect the accomplishments and challenges of implementing the Zero Waste Strategic Operations Plan. The indicators will measure the performance or effectiveness of specific policies or programs, and will be used to determine the need for future modifications to the Plan. For some goals, numeric targets have been established to further evaluate the accomplishments of the Plan.

The goal areas, indicators and targets are listed in Table 1-1.

Table 1-1. Goal Areas, Indicators and Targets
Goal Area/Indicator Targets

1. Waste Reduction
• Total citywide generation (also report
per capita and by sector)
• Amount landfilled
• Amount diverted (recycled and
composted, etc.) from landfill
• 80% diversion by 2015
• 95% diversion by 2030
• Per capita disposal rate of less than 3.6
pounds/person/day by 2020
• Per capita disposal rate of less than 1.1
pounds/person/day by 2030

2. Environmental Benefits
• Greenhouse gas emissions reduction
through waste reduction and recycling
programs
• Conversion of City fleets to clean
fuels/renewable
• 30% contribution to greenhouse gas
reduction goal through waste
prevention and recycling by 2015
• 50% contribution to greenhouse gas
reduction goal through waste
prevention and recycling by 2020
• 100% of all City fleet vehicles to clean
fuels by 2030

3. Economic Benefits
• Creation of new jobs
• Local market development
• 20% increase in local jobs from waste
prevention and recycling
• Local market development
o 3 new local partnerships by 2015
o 5 new partnerships by 2020

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Goal Area/Indicator Targets

4. City Leadership
• Zero waste at City offices and facilities
• Establish baseline
• Recycling and composting at all City
facilities by 2015
• 80% diversion rate at City facilities by
2015
• 95% diversion rate at City facilities by
2030

5. Producer Responsibility
• Producer responsibility for problem
products (advocacy at state level or
implementation of City ordinances)
• State legislation or City ordinance to
address pharmaceuticals, sharps,
batteries, fluorescent bulbs by 2020

6. Zero Waste Culture Change
• Customer participation and reduced
contamination
• Zero waste awareness at home, at
work, at school, at play
• 80% participation in City programs by
2015
• 90% participation in City programs by
2020
• 100% participation in City programs
by 2025
• Contamination reduced to 2% by 2015
• Contamination reduced to 1% by 2020
• 80% of residents and businesses
aware of Zero Waste by 2015
• 90% of residents and businesses
aware of Zero Waste by 2020

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2.0 CURRENT CONDITIONS
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2.0 Current Conditions
An important step in the planning process is to obtain a comprehensive understanding of the existing policies, programs, and infrastructure in the City. This helps ensure the Zero Waste Plan is in line with the City’s established goals and efforts.

2.1 Resource Recovery and Recycling Division
This section provides a description of the existing services provided by the City’s Resource Recovery and Recycling Division.

2.1.1 Residential Collection Services
The City’s Resource Recovery and Recycling Division provides collection services for all singlefamily (SF) and multi-family (MF) residences. There are approximately 50,000 total housing units in the City1
. Approximately 77% of the housing units are designated by the City as MF, which is defined as more than 2 units.

In 2011, the City collected an estimated 43,300 tons from residential customers, including approximately 27,600 tons of refuse, 8,500 tons of recyclables, and 7,000 tons of yard trimmings/ food scraps. A breakdown of the quantities and types of materials collected from single-family and multi-family residences is shown in Table 2-12.

Table 2-1. Residential Tonnages (2011)
Single-Family Multi-Family Total
Refuse 6,976 20,692 27,667
Recycling 4,099 4,479 8,578
Yard Trimmings/Food Scraps 6,428 613 7,041
TOTAL 17,503 25,783 43,287

1 US Census, 2010; http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk 2 The City does not have separate collection routes by customer type, and therefore percentage estimates have been calculated based on the 2009 container audit and weighted averages.

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2.1.1.1 Single-Family Residences
Single-family residences are provided with refuse, recycling, and yard trimmings collection services on a weekly basis, that utilizes an automated, 3-cart system. Residents can choose between 68- and 95-gallon sized black carts for refuse, and are provided 95-gallon blue carts for recyclables and 95-gallon green carts for yard trimmings. Items that are accepted in the blue recycling container are summarized in Table 2-2. Yard trimmings are composted at Community Recycling, located in Lamont, California, for agricultural use. The materials accepted in the yard trimmings carts include grass, leaves, weeds, tree trimmings, and small branches not more than 3 feet long. Currently, there are no restrictions or fees on the number of recycling or yard trimmings carts available to residents. Residents may request as many containers as they need.

Single-family residents pay for collection services bi-monthly, based on the frequency of service, the number of carts, and the size of the
refuse cart(s). The current collection rates
for single-family residences are included in
Table 2-3.

Beginning in August 2010, the City began a
pilot SF residential food scraps collection
program for approximately 600 households.

The program allowed residents to place
food scraps in their yard trimmings cart(s).

In late 2010, the City conducted a survey of
150 participants to collect feedback on the
food scraps collection program. Of the
responses received, 40% were participating
in the program while 60% were not
participating. Of the 60% of residents who
were not participating in the program, 67%
indicated they were not aware of the

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program and stated they would begin to participate in the program now that they were aware. In August 2011, the pilot program expanded to 330 households, in February 2012 to an additional 370 households, and in April 2012, a total of 1,300 households were participating in the program. Beginning June 30, 2012, all single-family residences were eligible to participate in the program. A map of the pilot program areas is shown in Exhibit 2-1. The co-collected food scraps and yard trimmings are taken to Southern California Disposal (SCD), where they are placed in transfer vehicles that are hauled to Community Recycling for composting. The City also offers home composting and vermicompost bins at a subsidized price as another measure to decrease the amount of organic materials that go to landfills.

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Table 2-2. Items Accepted in the City’s Recycling Program Glass
All glass bottles and jars (mayonnaise, apple juice bottles, wine bottles, etc.) CA redemption bottles (soda, beer, wine coolers, etc.)
Metal
Aluminum beverage cans and aluminum food cans (e.g., cat food cans) Steel/tin food and beverage cans
Clean aluminum foil and foil food trays
Paper
Newspaper (including inserts)
Office paper (white and colored)
Computer paper
Corrugated cardboard
Cardboard boxes and paper bags
Phone books
Magazines and catalogs
Food/detergent boxes
Mixed office paper (file folders, fax paper, envelopes, advertisements, flyers, etc.) Junk mail, bulk mail, and scrap paper
Paper bound with non-water soluble glue (paperback books, hardback books, overnight mail packages, etc.) Milk cartons (clean and rinsed)
Aseptic Packages (juice boxes)
Plastics
Plastics Numbered 1-5, and 7
Water/juice/soda bottles
Food containers
Milk and water jugs
Detergent/cleaning product bottles
Personal care bottles
Plastic bags (shopping bags, dry cleaner bags and other plastic bags)

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Table 2-3. Bi-Monthly Single-Family Residential Collection Rates (FY 2011/2012) Quantity, Size Refuse Cart Frequency Rate
1-68 gallon cart 1x weekly $64.85
2-68 gallon cart 1x weekly $129.70
3-68 gallon cart 1x weekly $194.55
1-95 gallon cart 1x weekly $83.76
2-95 gallon cart 1x weekly $167.54
3-95 gallon cart 1x weekly $251.31
1-68 & 1-95 gallon cart 1x weekly $148.63
2 cubic yard bin 1x weekly $335.06
300 gallon container 1x weekly $252.33
Shared container service $25.67
A bulky item collection service is offered by the City. Bulky items include large objects that do not fit in a refuse container, such as refrigerators, stoves, and furniture. The service is available to residents for a fee, depending on the size and amount of items discarded. The fees can range from $25 for small items, to $250 for large items.

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Exhibit 2-1. Map of SF Residences Participating in the Pilot Food Scraps Collection Program

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2.1.1.2 Multi-Family Residences
The City collects refuse from an estimated 40,000 multi-family (MF) units. Multi-family buildings are provided with either 68- or 95-gallon carts; 300-gallon containers; or 2-, 3-, or 4- cubic-yard bins for refuse collection. Residents of multiple unit dwellings and condominiums have a commingled recycling collection program. Blue 300-gallon containers, or 2, 3, or 4 cubic yard bins are placed throughout the alley ways for the collection of commingled recyclables from MF complexes. The containers and bins are either designated to specific complexes, or are shared by neighboring complexes. In 2012, there were approximately 400 large (more than 5 units) buildings that did not have recycling services. The City has been working to address this issue, and during 2013, all 400 buildings will be provided with recycling opportunities. A list of recyclables accepted by the City was provided in Table 2-2. The City also offers home composting and vermicompost bins at a subsidized price to multi-family residences as a measure to decrease the amount of organic materials that go to landfills. The current collection rates for multi-family residences are shown in Table 2-4.

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Table 2-4. Bi-Monthly Multi-Family Residential Collection Rates (FY 2011/2012) 68, 95 Gallon Refuse Carts 3 Cubic Yard Refuse Bin
Quantity, Size Frequency Rate Quantity, Size Frequency Rate 1-68 gallon cart 1x weekly $51.35 3 cubic yard bin 1x weekly $226.49 1-95 gallon cart 1x weekly $67.55 3 cubic yard bin 2x weekly $453.02 3 cubic yard bin 3x weekly $679.52
300 Gallon Refuse Container 3 cubic yard bin 4x weekly $906.03 Quantity, Size Frequency Rate 3 cubic yard bin 5x weekly $1,132.54 300 gallon container 1x weekly $147.27 3 cubic yard bin 6x weekly $1,358.97 300 gallon container 2x weekly $294.54
300 gallon container 3x weekly $441.82 4 Cubic Yard Refuse Bin 300 gallon container 4x weekly $589.10 Quantity, Size Frequency Rate 300 gallon container 5x weekly $736.38 4 cubic yard bin 1x weekly $300.26 4 cubic yard bin 2x weekly $600.51
2 Cubic Yard Refuse Bin 4 cubic yard bin 3x weekly $900.77 Quantity, Size Frequency Rate 4 cubic yard bin 4x weekly $1,201.03 2 cubic yard bin 1x weekly $154.03 4 cubic yard bin 5x weekly $1,501.28 2 cubic yard bin 2x weekly $308.07 4 cubic yard bin 6x weekly $1,801.54 2 cubic yard bin 3x weekly $462.09
2 cubic yard bin 4x weekly $616.11 Refuse Bin Roll Out
2 cubic yard bin 5x weekly $770.16 Quantity, Size Frequency Rate 2 cubic yard bin 6x weekly $924.17 Bin roll out 1x weekly $41.89 Bin roll out 2x weekly $83.76
Miscellaneous Bin roll out 3x weekly $125.65
Quantity, Size Frequency Rate Bin roll out 4x weekly $167.54 Livable Unit Charge $8.11 Bin roll out 5x weekly $206.35 No Charge/2nd Meter $0.00 Bin roll out 6x weekly $251.31 Lock Charge/Per Bin $17.58
City bin on City Property Per Bin $86.47 Refuse Bin Truck Roll Out Share Bin/Cart Service $37.84 Quantity, Size Frequency Rate Bin truck roll out 1x weekly $47.38
Bin truck roll out 2x weekly $94.76
Bin truck roll out 3x weekly $144.44
Bin truck roll out 4x weekly $189.52
Bin truck roll out 5x weekly $236.91
Bin truck roll out 6x weekly $284.29

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2.1.2 Commercial Collection Services
The City provides collection services for all 3,000 commercial accounts, representing approximately 14,000 businesses. A breakdown of the quantities and types of materials collected from commercial accounts is shown in Table 2-5. The container sizes available to commercial businesses for refuse include: 68- or 95-
gallon carts; 300-gallon containers; or 2, 3 or 4-cubicyard bins. Extra refuse collection containers are available for an additional fee, depending on the size and number of containers requested. The summary of commercial rates
for collection services is included in Table 2-6.

Commercial customers also pay for street sweeping
services. In the future, street sweeping services may be incorporated into the City’s overall rate structure.

Table 2-5. Commercial Tonnages (2011)
Tons
Refuse 38,199
Recycling 3,882
Food Scraps/Yard
Trimmings 2,316
TOTAL 44,398
The City provides commingled recycling collection services to all commercial customers at no additional charge. Approximately 820 businesses currently participate in recycling. Private haulers also provide recycling services to some commercial businesses. Table 2-2 includes the list of items collected in the commercial recycling program.

Food scraps recycling collection is available to restaurants, grocery stores and other establishments with food services. Presently, the service is offered at no additional charge. In the future, the program will be incorporated into the City’s overall rate structure. Participants are required to source separate all food scraps and place them into designated containers provided by the City. Currently, 98 businesses are participating in the program and another 471 businesses are eligible to participate. The City takes the food scraps to SCD, where it is loaded into roll-off containers and picked up by Community Recycling for transport to their composting facility it Lamont, California.

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Partnering with GeoGreen Biofuels, the City offers a fats, oil, and grease (FOG) collection program that is free of charge. Collection containers are located Downtown in parking structures 2 through 6. Restaurants that are not located Downtown can request a separate collection container by contacting the City.

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Table 2-6. Bi-Monthly Commercial Collection Rates (FY 2011/2012) 68 Gallon Refuse Cart 2 Cubic Yard Refuse Bin
Quantity, Size Frequency Rate Quantity, Size Frequency Rate 1-68 gallon cart 1x weekly $35.13 2 cubic yard bin 1x weekly $110.79 1-68 gallon cart 2x weekly $70.25 2 cubic yard bin 2x weekly $221.59 1-68 gallon cart 3x weekly $105.39 2 cubic yard bin 3x weekly $332.37 1-68 gallon cart 4x weekly $140.52 2 cubic yard bin 4x weekly $443.16 1-68 gallon cart 5x weekly $175.64 2 cubic yard bin 5x weekly $609.37 2 cubic yard bin 6x weekly $664.76
95 Gallon Refuse Cart 2 cubic yard bin 7x weekly $775.55 Quantity, Size Frequency Rate
1-95 gallon cart 1x weekly $50.00 3 Cubic Yard Refuse Bin 1-95 gallon cart 2x weekly $99.98 Quantity, Size Frequency Rate 1-95 gallon cart 3x weekly $149.98 3 cubic yard bin 1x weekly $149.98 1-95 gallon cart 4x weekly $199.97 3 cubic yard bin 2x weekly $299.94 1-95 gallon cart 5x weekly $249.96 3 cubic yard bin 3x weekly $449.93 3 cubic yard bin 4x weekly $599.91
300 Gallon Refuse Container 3 cubic yard bin 5x weekly $749.88 Quantity, Size Frequency Rate 3 cubic yard bin 6x weekly $899.85 300 gallon container 1x weekly $102.68 3 cubic yard bin 7x weekly $1,049.83 300 gallon container 2x weekly $205.36
300 gallon container 3x weekly $318.53 Refuse Bin Roll Out 300 gallon container 4x weekly $424.71 Quantity, Size Frequency Rate 300 gallon container 5x weekly $530.88 Bin roll out 1x weekly $24.32 Bin roll out 2x weekly $48.64
Miscellaneous Bin roll out 3x weekly $72.96
City bin on City property Per Bin $59.45 Bin roll out 4x weekly $97.28 Lock Charge Per Bin $17,58 Bin roll out 5x weekly $121.59 Non-Semi Auto Service 2x/week $45.94 Bin roll out 6x weekly $145.93 Bin roll out 7x weekly $170.23
Street Sweeping Rates (based on water meter size) Refuse Bin Truck Roll Out

0.75” Per Unit $74.32 Quantity, Size Frequency Rate

1.00” Per Unit $101.34 Bin Truck roll out 1x weekly $35.13

1.5” Per Unit $148.63 Bin Truck roll out 2x weekly $70.25

2.00” Per Unit $198.61 Bin Truck roll out 3x weekly $105.39

3.00” Per Unit $297.24 Bin Truck roll out 4x weekly $140.52

4.00” Per Unit $397.24 Bin Truck roll out 5x weekly $175.64

6.0” Per Unit $595.86 Bin Truck roll out 6x weekly $210.77 Bin Truck roll out 7x weekly $270.23

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2.1.3 Household Hazardous Waste
Residents have access to a free drop-off service for Household Hazardous Waste (HHW) at the City’s HHW Collection Center, located at the City Yards on 2500 Michigan Avenue. The operating hours of the HHW Center are the 1st Saturday of the month, between 9 am and 2 p.m.

Small businesses, those that generate less than 27 gallons of hazardous waste per month can make an appointment to bring hazardous waste to the City’s HHW Collection Center on the Friday before the 1st Saturday of the month. There is a fee for small businesses to use the HHW Collection Center. A list of the HHW accepted is provided in Table 2-7.

To supplement the services provided at the drop-off center, the City began a HHW Home Collection Program in August 2011. The HHW Home Collection Program is provided on a free and unlimited basis to homeowners and tenants in the City. Participants in the program must contact the City’s contractor to reserve the service and request a collection kit. On collection day, residents are instructed to leave their HHW at their doorstep where it is collected.

Materials accepted in the HHW Home Collection Program include:
• Aerosols
• Art Supplies
• Automotive Products
• Batteries
• Cleaners/Wax
• Garden Chemicals
• Lubricants
• Mercury Containing Devices
• Other Household Products
• Paints
• Personal Care Products
• Pesticides
• Sharps
• Electronics
• Pool Chemicals
• Auto Batteries: Up to 4
• Fluorescent Light Tubes (Straight): Up to 10, tubes must be taped • Televisions: 1
• Computer Monitors: 1
• Empty paint cans and/or dried latex paint not hazardous Other Consumer Electronics with Circuit Boards
• Desktop or laptop computers: 1
• Microwave ovens: Up to 2
• Desktop scanners, printers, copiers: Up to 2
• Fax machines: Up to 2
• Telephones, cell phones, portable phones, keyboards, mice, VCR’s, CD players, stereos disc drives, cables: No limit

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Table 2-7. Materials accepted at the City’s HHW Center
Category Materials Included
Aerosol Products Aerosol air fresheners, aerosol antibacterial sanitizers Art Supplies Adhesives, paint, cleaners, correction fluids, photography chemicals Automobile Batteries Automobile batteries
Automotive Products
Cleaners, lubricant, solvent, fuel, brake fluid, antifreeze, carburetor cleaner, metal conditioner, engine degreaser, fuel additives, refrigerants, transmission fluid, window washer fluid, used motor oil, used motor oil filters
Batteries All household types
Chemicals Garden chemicals, pesticides
Cleaners/Wax Polish, degreasers, rug/upholstery cleaners, oven cleaners, toilet bowl cleaners
E-waste Computer monitors, televisions, cell phones, DVD players Fats, Oil, and Grease Cooking oil
Fluorescent Straight Light
Tubes Fluorescent lamps
Lubricants Automotive/household compressor oil, cutting oil Paint
Aerosols, hobby/automotive/household latex and oil-based, thinners, strippers, wood preservatives, lacquers, linseed oil, primers, stains, varnishes
Personal Care Personal Care - nail polish, polish remover, rubbing alcohol, shoe polish, spot remover
Poisons Household/garden poisons, pesticides, insecticides, herbicides, fungicides, baits traps, fertilizers, pet care, pool chemicals Other Household
Fluorescent tubes/bulbs, compact fluorescent lamps (CFLs), thermostats, thermometers, propane tanks, moth balls, rust remover, kerosene
Sharps Medical Waste Needles, lancets
Oil and Oil Filters Used motor oil, oil filters

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2.1.4 Zero Waste Events
To promote and implement recycling, reuse and composting practices at special events, the Resource Recovery and Recycling Division offers assistance to help organizations implement Zero Waste events. The assistance includes a planning guide with information and recommendations on vendor involvement, food service, site planning, decorations and giveaways, education, volunteers, signage, and collection containers.

2.2 City Policies and Programs
The City has implemented numerous policies and programs that support the City’s resource recovery and sustainability efforts. These policies and programs were incorporated into the Zero Waste Planning process to ensure the goals and visions were aligned.

2.2.1 Santa Monica Municipal Code (SMMC)

2.2.1.1 Disposable Food Service Containers
Chapter 5.44 of the Santa Monica Municipal Code (SMMC) prohibits the distribution of disposable food service containers made of nonrecyclable plastic or expanded polystyrene foam from all food providers and at City events. The ban applies to single-use disposable containers intended for serving or transporting prepared, ready-to-eat food or beverages. The ban helps reduce the amount of plastic that ends up on the City’s beaches, reduces materials that go to the landfill, and also reduces the amount of natural resources used to manufacture and transport the disposable products.

2.2.1.2 Single-Use Carry Out Bags
Chapter 5.45 of the SMMC prohibits retail establishments, grocery stores, convenience stores, mini-marts, liquor stores, pharmacies, and any City events, from distributing petroleum and biobased single-use carryout plastic bags. The code imposes a $0.10 fee for each paper bag that is distributed, and requires paper bags to be 100% recycled content paper, with a minimum of 40% post-consumer, recycled content.

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The City has implemented a Share a Bag Program. The
program enables the community to donate extra, reusable bags at designated locations throughout the City for those who cannot afford reusable bags or for those who forget their reusable bags. There are 10 Share a Bag Program
locations citywide The locations are listed below and
shown on Exhibit 2-2.
• Santa Monica City Hall Help Desk, 1685 Main
Street
• Santa Monica Chamber of Commerce, 1234 6th
Street #100
• Downtown Santa Monica Ambassador's Desk,
Parking Structure 4, 1321 2nd St.
• Santa Monica Convention & Visitors Bureau, 1920
Main Street
• Santa Monica Place, The Market on Level Three
• Real Offices Center Santa Monica, 604 Arizona Ave
• Sustainable Works, 1744 Pearl Street
• Assistance League of Santa Monica Thrift Shop, 1453 15th Street • Cherry Picked Boutique, 2807 Pico Blvd.
• Virginia Avenue Park, 2200 Virginia Ave.

Exhibit 2-2. Share a Bag Locations

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2.2.1.3 Construction and Demolition Material Waste Management Plans Chapter 8.108, Subpart C, requires all City-sponsored construction and demolition (C&D) projects, as well as private C&D projects that are $50,000 or greater in value, or are 1,000 square feet or greater, to meet a minimum 70% diversion rate. Covered projects must submit a waste management plan (WMP) for City approval that includes the tonnages of materials that are disposed and diverted, and the methods implemented to reuse and/or recycle the materials,.

Applicants must provide a security deposit equal to 3% of the project value, or $30,000, whichever is less. Upon project completion, a final compliance report must be submitted for the security deposit to be refunded to the applicant.

A number of methods can be used to comply with the C&D diversion requirements. On -site reuse is allowed on a case by case basis, as approved in the WMP. Materials that are sourceseperated on site, such as wood, concrete, or asphalt, can be sent to an approved C&D facility for reuse or recycling. All mixed C&D materials are required to be sent to an approved mixed C&D recycling facility. A list of the City-approved C&D recycling facilities is included in Table 2-8.

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Table 2-8. Approved C&D Recycling Facilities (2010)
METAL companies listed below accept
both ferrous & non-ferrous metals,
unless otherwise noted.

MIXED C&D RECYCLERS Process
mixed C&D to extract recyclables

SALVAGED ITEMS (USED

BUILDING MATERIALS)
A&S Metal Recycling
2261 E. 15th Street
Los Angeles, CA 90021
213-623-9443
Community Recycling & Resource
Recovery, Inc.
9189 DeGarmo Avenue
Sun Valley, CA 91352
818-767-0675
Freeway Building Materials
1124 S. Boyle Avenue
Los Angeles, CA 90023
323-261-8904
Alpert & Alpert Iron & Metal
1815 Soto Street
Los Angeles, CA 90023
323-265-4040
Direct Disposal
3720 Noakes Street
Los Angeles, CA 90023
323-262-1604
Santa Fe Wrecking & Salvage
720 E. 18th Street
Los Angeles, CA 90021
213-765-8166
Atlas Iron & Metal
10019 Alameda Street
Los Angeles, CA 90002
323-566-5184
East Valley Diversion
11616 Sheldon Street
Sun Valley, CA 91352
818-252-0019
Scavenger’s Paradise
5453 Satsuma Avenue
N. Hollywood, CA 91601
323-877-7945
Kramer Metals
1760 E. Slauson Avenue
Los Angeles, CA 90058
323-587-2277
Downtown Diversion
2424 E. Olympic Blvd
Los Angeles, CA 90021
213-612-5005
WOOD
North Hills Recycling, Inc.
11700 Blucher Avenue
Granada Hills, CA 91344
818-831-7980
A-1 Metals Recycling, Inc.
8250 Tujunga Avenue
Sun Valley, CA 91352
818-767-4388
California Waste Services
621 W. 152nd Street
Gardena, CA 90247
310-538-5998
Recycled Wood Products
1313 E. Phillips Blvd
Pomona, CA 91766
909-868-6882
INERT MATERIAL Southern California Disposal
1908 Frank Street
Santa Monica, CA. 90404
310-828-6444

CARPET PADDING
Hanson Aggregates
5625 Southern Avenue
South Gate, CA 90280
800-300-6120
Carpet Pad Recycling
1923 Rosemead Blvd
South El Monte, CA 91733
626-444-6048
Arcadia Reclamation, Inc.
12321 Lower Azusa Road
Arcadia, CA. 91006
909-392-8510
Interior Removal Specialist, Inc.
9309 Rayo Avenue
South Gate, CA 90280
323-357-6900

CARDBOARD
Allan Company
2411 Delaware Avenue
Santa Monica CA 90404
310-453-9677
Vulcan Materials Company
11520 Sheldon Blvd
Sun Valley, CA 90052
818-768-4157

INERT MATERIAL BRICK & ROOFING TILES
Valley Base Materials
2121 E. 25th Street
Los Angeles, CA 90058
323-583-7913
Bourget Bros Building Materials
1636 11th Street
Santa Monica, CA 90404
310-450-6556
Chandler’s Sand Gravel
26311 Palos Verdes Drive East
Rolling Hills Estates, CA 90274
310-784-2900
Nu-Way Arrow Reclamation
1270 E. Arrow Highway
Irwindale, CA. 91706
626-305-5308

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In 2010, the City conducted an audit of the mixed C&D recycling facilities. The results of the audit indicated a total of 35,308 tons of C&D materials originating in the City were processed at these facilities, with 31,116 diverted from landfilling, for an average of 88% diversion. Table 2- 9 includes the approved mixed C&D recycling facilties, along with the facility diversion rates, and tons of materials processed from the City in 2010.

Table 2-9. City-Approved Mixed C&D Recycling Facilities (2010) Facility Name and Location
Tons
Originating
in Santa
Monica
Diversion
Rate
Tons
Diverted
California Waste Services 5,922 87% 5,152
Community Recycling 16,742 93% 15,570
Direct Disposal 311 73% 227
Downtown Diversion 10,087 83% 8,372
East Valley Diversion 62.6 85% 52.4
Interior Removal Specialists 1,190 78% 928
Southern California Disposal 994 82% 815
TOTAL 35,308 88% 31,16

2.2.2 Extended Producer Responsibility
Resolution 10412, signed on June 23, 2009, documents the City’s support for an extended producer responsibility (EPR) framework in State legislation by way of urging the League of California Cities, the California State Association of Counties, and CalRecycle to advocate for more EPR policies. The resolution states that the City will encourage all manufacturers to take part in the responsibility of their products, from the processing, collection, recycling, and disposal of the materials.

2.2.3 Recycled Products Procurement Policy
The Recycled Products Procurement Policy was developed in 1991 to help the City make responsible decisions in purchasing products with recycled content. The main guidelines of the policy include the following:
• The priority in which products should be purchased based on the highest content of post-consumer material, pre-consumer material, and minimum recycled content. • The ability of a product and its packaging to be reused, reconditioned for reuse, or recycled, and the amount of waste the product and its packaging generates.

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• Equipment purchased or rented by the City are to be compatible with the use of recycled-content products.
• Product specifications, requisitions, and performance standards must not require the use of products made from virgin materials or exclude recycled-content products.

2.2.4 Sustainable City Plan
In September 1994, the City Council took steps to address sustainability concerns in the community by adopting the City of Santa Monica Sustainable City Plan. The Sustainable City Plan provides a roadmap to ensure the City meets its environmental, economic, and social needs without compromising the quality of life for the community and for future generations. The plan has concrete goals and targets for tracking the City’s progress in the following nine areas:

1. Resource Conservation

2. Environmental and Public Health

3. Transportation

4. Economic Development

5. Open Space and Land Use

6. Housing

7. Community Education and Civic Participation

8. Human Dignity

9. Arts and Culture
The Sustainable City Plan includes goals and strategies, for the City government and all sectors of the community, to conserve and enhance local resources, safeguard human health and the environment, maintain a healthy and diverse economy, and improve the livability and quality of life for all community members in the City.

Under the Resource Conservation area, the City established the following goals for solid waste generation:
• Total citywide generation to not exceed year 2000 levels by 2010 • Increase amount diverted to 70% of total by 2010.

The goals of the Sustainable City Plan are tracked through a Sustainable City Progress Report and Report Card. In 2005, a Progress Report website was launched to provide updates on the status of the Plan as well as a letter grade that rates the City on its efforts in the initial eight target areas. In 2012, a ninth target area, Arts and Culture, was added to the Sustainable City Plan.

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The Sustainable City Report Card is a document that provides a summary of the grades that are also posted on the Progress Report website. The most recent Sustainable City Report Card was released in 2012, a summary of those grades are provided in Table 2-10. The 2010 waste diversion goal was exceeded in 2009 with a diversion rate of 74%.

Table 2-10. 2010 Sustainable City Report Card Grades
# Category Overall
Grade Effort
1 Resource Conservation B- A2 Environmental and Public Health C+ A3 Transportation C+ A 4 Economic Development B A5 Open Space and Land Use A- A 6 Housing C A
7 Community Education and Civic Participation A- A
8 Human Dignity B A
9 Arts and Culture1 N/A N/A
1 The Arts and Culture category was added in 2012 and grades were not included in the 2012 report card.

2.2.5 Green Business Certification Program
The City, the Convention and Visitors Bureau, the Chamber of Commerce, and the Sustainable Works non-profit organization have joined together to certify and recognize green businesses in the community through the Green Business Certification Program. The Program recognizes and certifies businesses that have taken steps to incorporate sustainable practices into their operations. In order to apply for a green certification, businesses must have a physical location in the City, a minimum of five
employees, and occupy a minimum of 500 square feet
of commercial business space. Eligible businesses must
fall under one of the following categories:
• Office
• Retail Store
• Restaurant
• Grocery
• Hotel
• Motel
Businesses that successfully pass the verification
process are green certified for a period of 2 years. A

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total of 19 businesses were certified in the latest (2011-2013) Business Certification Program.

2.2.6 Sustainable Quality Awards
The Sustainable Quality Awards (SQA) event was developed to identify and recognize businesses in the City that are successfully incorporating sustainable practices into their operations. The SQA is an annual event that promotes the efforts of local businesses that have made significant achievements in the areas of sustainable economic development, social responsibility, and stewardship of the natural environment.

2.2.7 US Conference of Mayors/California Public Interest Research Group (CALPIRG) Buy Recycled Campaign In September 1995, the City adopted a resolution for the US Conference of Mayors/California Public Interest Research Group (CALPIRG) Buy Recycled Campaign. In the resolution, the City agreed to purchase paper that contains a minimum of 20% post-consumer recycled content, increasing the amount of post-consumer recycled content to 30% beginning in 1998. The City currently exceeds these standards by using paper containing a minimum of 50% post-consumer recycled content.

2.2.8 City’s Purchase and Use of Tropical Forest Wood Products Ordinance 2.28 bans the purchase or use of any tropical hardwood product within the City, or at any City-sponsored events. The ordinance requires all contracts between the City and any supplier of wood products to include provisions that restrict the use of tropical wood.

2.2.9 Print Shop Purchasing Policy
The City’s print shop has a policy to exclusively purchase and use recycled paper and vegetablebased printing inks, unless a printing request is submitted that cannot be completed using those products. It is estimated that 99% of all printing jobs are completed using recycled paper and vegetable-based inks.

2.2.10 Electronic Waste
Electronic waste (E-waste), such as computers and televisions, is collected through a drop-off program for residents and businesses at the Santa Monica Community Recycling Center, located at 2411 Delaware Avenue. The drop-off program is free to residents and fee-based for businesses.

2.2.11 Used Oil and Filter Collection
Collection centers are located throughout the City for residents to drop off used oil and oil filters.

Exhibit 2-3 provides a map of the drop off locations.

2.2.12 Christmas Tree Recycling
During the month of January each year, Christmas trees can be taken and recycled at four local parks or at the SCD Transfer Station in the City for free. The trees collected at the parks are turned into mulch and used throughout the City.

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Exhibit 2-3. Used Oil and Oil Filter Collection Locations

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2.2.13 Catalogue Choice
City residents can sign up for a free account to opt-out of unwanted catalogs, phone books, coupons, circulars, credit card offers, and donation solicitations. The website is accessed through https://santamonica.catalogchoice.org/login.

2.2.14 Scheduled Events
The City schedules a variety of waste reduction, re-use, recycling and composting events on a quarterly basis:
• E-Waste collection
• Textile recycling
• Paper shredding
• Compost give-away days and workshops
• Re-use workshops
• Annual Citywide yard sale

2.3 Resource Recovery and Recycling Processing Facilities There are two resource recovery and recycling processing facilities located within the City limits: the Santa Monica Community Recycling Center and the SCD Transfer Station.

2.3.1 Santa Monica Community Recycling Center
The Santa Monica Community Recycling and Buy-Back Center is located at 2411 Delaware Avenue. The property is owned by the City and leased to the Allan Company, who owns and operates the facility equipment. The Center is open Monday through Friday from 8:00 a.m. to 5:00 p.m., and on Saturdays from 8:00 a.m. to 2:00 p.m. The Center may close earlier due to maximum daily tonnage restrictions.

The Community Recycling Center accepts the
following items:
• Cans – aluminum, steel
• Glass – bottles and jars
• Plastic
• Mixed Paper
• Scrap Metal
• Electronics
• White goods - stoves, refrigerators and other appliances • Used motor oil and oil filters

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2.3.2 Southern California Disposal Transfer Station
The SCD Transfer Station is a
privately owned facility that is open
to the public. The transfer station is
located at 1908 Frank Street, and is
open Monday through Friday from
6:00 a.m. to 2:00 p.m., and on
Saturdays from 6:00 a.m. to 1:30
p.m.

Items that are accepted at the
facility include:
• Refuse
• Food scraps
• Yard trimmings
• C&D debris
• Street sweeping collections
In addition, SCD receives and transfers all refuse, yard trimmings, and food scraps that are collected by the City. SCD transfers refuse to a number of facilities, including Puente Hills landfill, Sunshine Canyon Landfill, Chiquita Canyon Landfill, Southeast Resource Recovery Facility (SERRF), and Commerce Refuse to Energy Facility. Yard trimmings, food scraps, and street sweepings are transferred to Community Recycling for composting at its compost facility in Lamont. Community Recycling receives the City’s food scraps at the SCD transfer station, and transfers the material to its composting facility in Lamont, California. Construction and demolition debris generated from City projects is also transferred through SCD to Community Recycling for processing, recycling, and disposal.

2.4 Educational Outreach

2.4.1 Sustainable Works
Sustainable Works, a project of Community Partners, is a non-profit environmental education organization within the City. The organization offers four different sustainability programs:

Business Greening, Community Sustainability, Residential Greening, and Student Greening.

The Business Greening Program is free to Santa Monica businesses through a subsidy provided by the City’s Office of Sustainability and the Environment. The Program assists businesses in greening their bottom line by helping them save money and resources through increased efficiency and employee education. Sustainable Works performs on-site environmental assessments to evaluate current business practices and provides sustainable recommendations.

The Community Sustainability Program facilitates the adoption of sustainable practices in the community and engages stakeholders to help meet sustainability goals.

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The Residential Greening Program offers free Green Living Workshops for residents in the City, and to non-residents for a fee. The series features six workshops offered once a week, for six weeks, covering topics that include resource recovery and recycling, water, energy, transportation, chemicals, and responsible purchasing. A Sustainable Works book is provided to each participant, which includes comprehensive resources for sustainable living.

The Student Sustainability Workshop is a program that provides educational, student leadership, and community building opportunities to its participants while shaping the next generation of environmental leaders.

2.4.2 Community Sustainability Liaison
The role of the Community Sustainability Liaison is to provide Santa Monica residents and community organizations with information and resources needed to help meet the goals of the Santa Monica Sustainable City Plan. The Liaison also helps coordinate educational outreach events within the community and produces a monthly electronic newsletter that highlights local sustainable news and events.

2.4.3 Educational Outreach Tools
The City provides updates and information on its programs, policies, and events through a variety of outreach tools. Information is dispersed online (City websites and emails), via mail, television programming, workshops, advertisements in public spaces, and through citywide events. A list of some of the media available to the City for public outreach and education is provided in Table 2-11. The Environmental Directory includes a thorough list of local resources for topics that range from energy efficiency programs to environmentally preferred purchasing. The booklet also includes resources for refuse, recycling, composting, and hazardous waste.

Table 2-11. Educational Outreach Media
Media
Resource Recovery and Recycling Division Website
Office of Sustainability and the Environment Website
Sustainable Santa Monica Electronic Newsletters
Sustainable Santa Monica Facebook Page
Santa Monica Resource Recovery and Recycling Facebook Page and Twitter City Emails
Press Releases/Media Lists (i.e., Santa Monica Daily Press, Santa Monica Mirror, Santa Monica Observer, the Argonaut, etc.) CityTV Programming
Community Events/Workshops
City Hall Public Information Desk
Libraries
Farmers Markets
Display Advertising (Big Blue Bus Advertising, etc.)
City Collection Truck Advertising

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2.4.4 Educational Outreach Events
The City hosts a variety of environmental events throughout the year. These events provide the City an opportunity to directly reach out to community members, support local businesses, and promote sustainability efforts. The Santa Monica Festival is the largest festival in the City, and is held each year in May at Clover Park. The City also dedicates the month of September as Sustainability Awareness Month, in which key messages are targeted to residents, businesses, and the City Council regarding sustainability topics.

Events that take place during Sustainable Santa Monica Awareness Month include:
• Business Mixers
• Residential Workshops
• Film Screenings
• A Sustainable Food Event
• Report Card Launch
• Student Poster Contest
• Green Prize for Sustainable Literature
A summary of annual sustainability events hosted by the City is provided in Table 2-12.

Table 2-12. Citywide Environmental Events
Event Month
Buy Local Expo March
Sustainable Industries Economic Forum April
Santa Monica Festival May
AltBuild Expo May
Sustainable Quality Awards May
Main Street Festival June
Solstice Festival June
Sustainable Santa Monica Awareness Month September
AltCar Expo October
Pico Festival October

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3.0 Generation and Characterization

3.1 Existing Generation
Analyzing the City’s generation provides an understanding of which areas to target in the Zero Waste Strategic Operations Plan. Utilizing both the generation data and the inventory of existing programs and infrastructure, zero waste options were developed that will provide the most significant impact on reducing waste and increasing diversion.

In 2011, the City’s generation, as calculated by CalRecycle, was approximately 360,000 tons of materials. Out of the total tons generated, 77% was diverted through waste prevention, recycling, and composting, and 23% was disposed in landfills or waste-to-energy facilities. The Zero Waste Strategic Operations Plan prioritizes source reduce, reuse, recycling, and composting materials before landfilling or processing at waste-to-energy facilities. The total amount of materials generated is calculated using the City’s average generation rate from the years 2003 through 2006. This methodology is consistent with the CalRecycle per capita disposal equivalent methodology (as set forth in state statute). The City’s 2011 per capita disposal was

5.0 pounds per person per day (PPD). Compared to the per capita disposal target of 10.9 PPD, the City was well within the target goal. The City’s overall 2011 generation is included in Table 3-1.

Table 3-1. Overall Generation 2011 (tons)
Disposal Diversion Total
82,997 275,355 358,351

3.2 Waste Diversion
In 2011, the City diverted approximately 275,355 tons of material, or 77% of the total materials generated. The diversion programs provided by the City, and waste prevention and recycling efforts undertaken by individual residents and businesses, all contribute to the City’s diversion rate. A summary of the activities that contribute to diversion in the City is provided in Table 3-

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Table 3-2. 2011 Diversion Summary
Source/Program Diversion
(Tons)
SF Residential 10,527
Curbside Recycling 4,099
Yard Trimmings and Food Scraps 6,428
MF Residential 5,092
Recycling 4,479
Yard Trimmings 613
Commercial 6,412
Recycling 3,882
Yard Trimmings and Food Scraps 2,530
Self-Haul 3,356
Recycling 3,248
Yard Trimmings and Food Scraps 108
C&D 41,919
Commercial 2,861
Self-Haul 7,945
Private C&D Recycling 31,113
Street Sweeping 2,627
Other City Programs3 17,790
Residential Drop-Off 164
Residential Buy-Back 17,484
Tires 13
White Goods 7
Scrap Metal 78
E-waste 8
HHW 36
Diversion at Landfills (alternative daily cover, beneficial reuse, etc.) 12,601
Other Source Reduction & Recycling Programs4 175,031
Total 275,355

3 City of Santa Monica 2010 Annual Report to CalRecycle 4 This figure was estimated based on CalRecycle’s calculation of citywide generation, and includes waste prevention and recycling efforts undertaken by individual residents and businesses in the City.

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3.3 Disposal
In 2011, 82,997 tons of materials were disposed in landfills or processed at waste-to-energy facilities. Commercial waste comprised approximately 50% of the disposed waste, MF residential waste comprised almost 25% of disposal, and SF residential waste made up 8%. The remaining disposal consisted of self-haul construction and demolition (C&D) debris and additional materials that were disposed by private companies or individuals. A summary of the disposed waste is provided in Table 3-3.
.

Table 3-3. 2011 Disposal Summary (tons)
Source Tons
SF Residential 6,976
MF Residential 20,692
Commercial 39,931
Self-Haul (City controlled) 7,494
Self-Haul (Not City
controlled)5 7,905
Total 82,997

3.4 Discarded Materials Characterization
Understanding the types and quantities of materials that make up the discarded materials generated in the City is an important element of the Zero Waste Strategic Operations Plan. The data helps guide the development and selection of policies, programs and facilities, and to target specific material types and/or products. Since discarded materials vary by generator type, it is important to analyze the materials generated by each sector.

3.4.1 Methodology
For this study, the waste composition percentages contained in the California 2008 Statewide Waste Characterization Study were applied to the City’s discarded materials quantities to

5 Consists of disposal by private companies and individuals outside of the City’s control.

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identify the types and quantities of materials disposed by sector6. The specific data used for Santa Monica was taken from the “Overall Disposed Waste Composition: Southern Region.” The study characterizes the waste into 10 categories and 62 material types. Table 3-4 shows the overall waste characterization by material category for each sector. The detailed data for all material categories and types for each sector is included in Appendix A.

Table 3-4. Composition by Material Category and Generator Sector Category SF
Residential
MF
Residential Commercial SelfHaul
Paper 18.3% 22.2% 20.1% 5.1%
Glass 2.2% 2.9% 1.2% 0.4%
Metal 3.7% 3.4% 4.3% 4.4%
Electronics 0.4% 0.0% 0.1% 0.3%
Plastic 9.9% 7.0% 10.5% 5.7%
Other Organic 47.0% 41.8% 31.9% 10.1%
Inerts and Other 14.7% 17.7% 28.1% 62.9%
Household Hazardous Waste (HHW) 0.2% 0.2% 0.3% 0.1%
Special Waste 0.2% 3.8% 3.5% 11.0%
Mixed Residue 3.5% 1.1% 0.0% 0.0%
Source: CalRecycle, 2008 State-wide Waste Characterization Study, Southern Region

6 Cascadia Consulting Group, for the California Integrated Waste Management Board (now “CalRecycle”).

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3.4.2 Single-Family Residential Waste Composition
Within the single-family residential sector, the following key findings are identified:
• Other Organic makes up 47% (3,280 tons) of the sector’s total disposed wastestream.

Food waste was the largest material type in this category, which made up 24% (1,687 tons) of the overall waste disposed within this sector; followed by leaves and grass at approximately 8% (540 tons); and remainder/composite organics at approximately 7% (484 tons).
• Paper makes up 18% (1,273 tons) of the wastestream; remainder/composite paper was the largest material type and made up approximately 6% (401 tons). • Inerts and Other make up approximately 15% (1,026 tons) of the wastestream; lumber was the largest material type in this category, which made up almost 8% (543 tons) of the disposed wastestream.

A summary of the quantity of materials disposed in the SF residential sector is shown in Exhibit 3-1.

Exhibit 3-1. Single Family Residential Disposed Waste Composition Paper
1,273 tons
Glass
150 tons
Metals
256 tons
Electronics
26 tons
Plastics
691 tons
Other Organic
3,280 tons
Inerts and Other
1,026 tons
HHW
17 tons
Special Waste
15 tons Mixed Residue
243 tons

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3.4.3 Multi-Family Residential
Within the multi-family residential sector, the following key findings are identified:
• Other Organic makes up the largest category of the materials, which was approximately 42% (8,639 tons) of the sector’s total wastestream. Food waste was the largest material type in this category, which made up approximately 22% (4,460 tons) of the overall waste disposed within this sector; followed by remainder/composite organics at 9% (1,890 tons); and carpet which was 6% (1,300 tons).
• Paper makes up 22% (4,590 tons) of the wastestream; uncoated corrugated cardboard, other miscellaneous paper, and remainder/composite paper were the largest material types in this category, each made up approximately 5% (1,000 tons) of the wastestream. • Inerts and Other make up approximately 18% (3,668 tons) of the wastestream; lumber was the largest material type in the category, which made up 12% (2,568 tons) of the total disposed wastestream.

A summary of the quantity of materials disposed in the MF residential sector is shown in Exhibit 3-2.

Exhibit 3-2. Multi-Family Residential Disposed Waste Composition Paper
4,590 tons Glass
596 tons
Metals
692 tons
Electronics
6 tons
Plastics
1,443 tons
Other Organic
8,639 tons
Inerts and Other
3,668 tons
HHW
39 tons
Special Waste
794 tons
Mixed Residue
225 tons

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3.4.4 Commercial
Within the commercial sector, the following key findings are identified:
• Other Organic makes up the largest category of the materials, at 32% (12,721 tons) of the sector’s disposed wastestream. Food waste is the largest material type in this category, which makes up15% (6,102 tons) of the overall waste disposed within this sector; followed by carpet at 5% (1,994 tons); and prunings and trimmings at 4% (1,683 tons).
• Inerts and Other make up 28% (11,217 tons) of the wastestream; lumber is the largest material type in the category, which makes up approximately 17% (6,570 tons). • Paper made up 20% (8,807 tons) of the wastestream; cardboard was the largest material type and made up approximately 7.5% (2,981 tons) of the total disposed wastestream.

A summary of the quantity of materials disposed in the commercial sector is shown in Exhibit 3-

3. Exhibit 3-3. Commercial Disposed Waste composition- Percentages Paper
8,007 tons
Glass
477 tons
Metals
1,730 tons
Electronics
42 tons Plastics
4,197 tons
Other Organic
12,721 tons
Inerts and Other
11,217` tons
HHW
125 tons
Special Waste
1,413 tons Mixed Residue
2 tons

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3.4.5 Self-Haul
Within the self-haul sector, the following key findings are identified:
• Inerts and Other makes up the largest category of materials, which is 63% (9,692 tons) of the sector’s disposed wastestream.
• Special Waste makes up 11% (1,689 tons) of the wastestream, which consists entirely of bulky items.
• Other Organic makes up 10% (1,559 tons) of the wastestream; carpet is the largest material type and makes up approximately 4% (551 tons) of the total disposed wastestream.

A summary of the quantity of materials disposed in the self-haul sector is shown in Exhibit 3-4.

Exhibit 3-4. Self-Haul Disposed Waste Composition Percentages Paper
785 tons
Glass
58 tons Metals
675 tons
Electronics
50 tons
Plastics
872 tons
Other Organic
1,559 tons
Inerts and Other
9,692 tons
HHW
18 tons
Special Waste
1,689 tons
Mixed Residue
3 tons

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3.5 Disposal Projections

3.5.1 Population Projections
Low and high population forecasts were provided in the City’s 2010 Land Use and Circulation Element (LUCE)7. The forecasts used for the disposal projections are an average of the low and high population estimates from the LUCE. As shown in Table 3-5, the average 5-year percentage increase between 2010 and 2030 is 1.31%, and the 20 year cumulative growth is

5.23%. Refer to Appendix B for the reference LUCE data.

Table 3-5. Population Forecasts (2010-2030)
Source 2013 2014 2015 2020 2025 2030
20 year
Cumulative
% Change
Average Growth 91,578 91,820 92,063 93,275 94,488 95,700 % change-5 yr. - - 1.33% 1.32% 1.30% 1.28% 5.23%

3.5.2 Future Disposal
The disposal projections for the City are calculated based on the population growth projections and waste composition data. Overall, it is anticipated the waste disposal will increase by over 3,756 tons between 2013 and 2030, which represents an increase of approximately 220 tons per year. A summary of the waste disposal tonnage projections for each sector is provided in Table 3-6. The commercial sector is expected to contribute an additional 106 tons per year to the disposal waste stream from 2013 to 2030. The multi-family residential sector disposal is expected to increase by 55 tons per year through 2030; the single-family residential sector disposal is expected to increase approximately 19 tons per year; and the self-haul sector by 41 tons per year. Utilizing the data in Table 3-6, the types and quantities of materials that can potentially be source reduced, recycled, and/or composted have been identified for each waste sector in the Zero Waste options in Section 4.

7 City of Santa Monica Land Use and Circulation Element.

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Table 3-6. Waste Disposal Projections 2013-2030 (Tons)
Source 2013 2014 2015 2020 2025 2030
SF Residential

7,013

7,032

7,050

7,143

7,236

7,329
MF Residential

20,801

20,857

20,912

21,187

21,462

21,738
Commercial

40,143

40,249

40,356

40,887

41,419

41,950
Self-Haul

15,481

15,522

15,563

15,768

15,973

16,178
Total*

83,438

83,659

83,880

84,985

86,090

87,195
* Values may not sum to total due to rounding

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4.0 Zero Waste Options

4.1 Initial List of Potential Options
To meet its Zero Waste goal, the City will implement expanded and new policies, programs and infrastructure during the short, medium and long terms. For purposes of this plan, the short term is considered years 2013-2015, the medium term is years 2016-2022, and the long term is years 2023-2030.

Using the information on current policies, programs and facilities (Section 2), and the waste generation and composition of discarded materials (Section 3), zero waste options were identified for potential implementation in the single-family, multi-family, and commercial sectors. Policy, program, and facility options included opportunities to improve existing programs, as well as new programs for reducing generation and discarded materials and increasing diversion.

Initially, a list of 33 options was developed for review and evaluation. The options were categorized as follows:

Mandatory - Policies or programs that are compulsory (such as meeting a diversion requirement) or prohibit an activity (such as a disposal or use ban).

Collection - Programs for the collection of residential and commercial food scraps, recyclables, and bulky items.

Rate Setting – Revised fee structures to account for basic and additional services, for singlefamily, multi-family, and commercial sectors.

Upstream – Policies and programs to support re-design strategies to reduce the volume and toxicity of discarded products and materials, and promote low-impact or reduced consumption lifestyles.

Downstream – Policies and programs to address reuse, recycling and composting of end-of-life products and materials to ensure their highest and best use.

Facilities – Local and regional, existing and new, resource recovery facilities for processing recyclables, residuals, and other materials for beneficial use and energy recovery.

The list included three mandatory policies/program options, seven collection program options, two rate setting options, three upstream options, fourteen downstream options, and four facility options. A description of each option was included, along with the affected waste sector (singlefamily, multi-family, government); relevant guiding principles; implementation opportunities and obstacles, portion of discarded materials, potential capture rate by material type, implementation time frame, and examples from other jurisdictions, as available. The initial list of options were considered and then reduced, based on the elimination of some options. A summary of the list of initial options, and resulting status, is included in Table 4-1.

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Table 4-1. Initial List of Zero Waste Options
Title Description Affected Waste
Sector
Resulting
Status

MANDATORY

1. Disposal bans Restrict disposal of specific materials, such as plastic bottles and cardboard.
•S-F
• M-F
•Commercial
Recommend

2. C&D ordinance revision Revise C&D ordinance to increase diversion requirement from 70% to 90%.
•S-F
• M-F
•Commercial
Recommend

3. Mandatory diversion rate Require commercial, residential, and government sectors to meet specific diversion
rates.
•S-F
•M-F
•Commercial
Recommend

COLLECTION

4. Mandatory food scraps
participation -commercial
Require food establishments to participate in the
City’s food scraps diversion program.
•Commercial Recommend

5. Mandatory food scraps
participation -residential
Require residents to participate in the City’s
food scraps diversion program.
•S-F
•M-F
Recommend

6. Mandatory commercial
recycling
Adopt an ordinance that expands on AB 341 to
require all businesses to have recycling service.
•Commercial Recommend

7. Mandatory recycling of
new materials
Require recycling of carpets, textiles, mattresses,
and other items currently not collected in the
recycling bins.
•S-F Recommend

8. Wet/Dry collection Separate wet (food waste) and dry (nonrecyclable materials) waste by different color bags to be separated at the MRF.
•M-F
•Commercial
Modified

9. Weekly organics collection
and bi-weekly collection
of trash and recyclables
Reduce the collection frequency of trash and
recycling containers while maintaining organics
collection at once per week.
•Phase 1: S-F
•Phase 2: M-F
Modified

10. Bulky item collection for
reuse and recycling
Expand collection frequency with emphasis on
reuse and recycling; partnership with reuse
organizations
•M-F Modified

RATE SETTING

11. Implement Integrated
Waste Management Fee
Structure
Revise fee structure to account for basic services
and additional services
Eliminate “free recycling and organics”
•S-F Recommend

12. Implement Integrated
Waste Management Fee
Structure
Revise rate structure •M-F
•Commercial
Recommend

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Title Description Affected Waste
Sector
Resulting
Status

UPSTREAM POLICIES AND PROGRAMS

13. EPR for HHW,
pharmaceuticals, and/or
difficult to recycle items
Establish mandatory take back provisions for
producers and/or businesses that sell batteries,
fluorescent light bulbs, sharps and
pharmaceuticals, or other difficult to recycle
products. Difficult to recycle items can include
Styrofoam, packaging materials, and toys.
•S-F
• M-F
•Commercial
Recommend

14. Packaging legislation Support legislation that requires manufacturers to reduce packaging and to incorporate recycled
content materials in all packaging.
•S-F
•M-F
•Commercial
Recommend

15. Behavior change
marketing
Large scale, sustained, social marketing and
media campaign
•S-F
•M-F
•Commercial
Recommend

DOWNSTREAM POLICIES AND PROGRAMS

16. Expansion of the SingleUse Carry Out Bag
ordinance
Establish a date to review the progress of the
current ordinance and set a goal date to expand
the program to all retailers and restaurants.
•Commercial Recommend

17. Multi-Family recycling
educational outreach
Require multi-family building managers to
inform tenants about recycling resources upon
move-in.
•M-F Recommend

18. Move-in/Move-out
program
Provides free excess waste pickup services for
residents moving in/out of their homes
•M-F Modified

19. Self-haul waste origin
reporting
Require more accurate reporting of self-haul
waste origin at transfer and disposal sites
•S-F Recommend

20. Regional Sustainability
Collaboration Meetings
Host regular meetings with local jurisdictions to
discuss opportunities, projects, and issues.
•S-F
•M-F
•Commercial
Recommend

21. Update Environmental
Directory
Update the 2009 Environmental Directory. •S-F
•M-F
•Commercial
Modified

22. School recycling
competitions
Hold competitions between schools to see who
can divert the most materials from their waste
stream within a fixed time frame. Prizes,
money, trophies, etc. can be awarded to the
school that collects the most.
•Commercial Modified

23. HHW collection bins at
public events
Collect used batteries, cell phones, etc. at public
events. Events can include farmer’s markets,
Santa Monica Festival, street fairs, etc.
•S-F
•M-F
Recommend

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Title Description Affected Waste
Sector
Resulting
Status

24. Expand items collected in
the recycling bins
Materials could include clothing, diapers, chip
bags, and other specific materials.
•S-F
•M-F
•Commercial
•Government
Recommend

25. Centralized “garage sales” Establish a program for residents to sell items in a centralized location, as opposed to the many
garage sales typically held in the City.
•S-F
•M-F
Recommend

26. Clothing drives Hold clothing drives to collect clothing, shoes, blankets, etc. to donate to thrift stores, reuse
centers, homeless shelters, etc.
•S-F
•M-F
•Commercial
Eliminated

27. Business & restaurant food
donation
Program to help businesses and restaurants find
resources that will accept food donations.
•Commercial Recommend

28. Diversion Recognition and
Rewards Program
Reward residents for participating in recycling. •M-F Modified

29. Product reuse/recycling
grants
Offer grants and/or subsidies to individuals and
businesses to develop businesses in the City that
reuse or recycle materials.
•S-F
•M-F
•Commercial
Modified

FACILITIES

30. Transform residuals Send all residual waste to a waste-to-energy facility.
•S-F
•M-F
•Commercial
•Government
Modified

31. MRF residual materials Send residual materials to mixed waste MRF for further sorting prior to landfilling or
transformation.
•S-F
•M-F
•Commercial
Eliminated

32. Resource Recovery
Park/Hard to Recycle
Center
Facility that accepts materials that are difficult to
recycle (e-waste, Styrofoam blocks, textiles,
etc.) and identifies reuse/recycle opportunities;
also works with manufacturers on take-back
programs.
•S-F
•M-F
•Commercial
•Government
Recommend

33. Alternative Technology
Facility
Utilize regional facility for processing of
residual waste into energy or other beneficial
use.
•S-F
•M-F
•Commercial
•Government
Recommend

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4.2 Recommended Strategies
The initial list of options was reviewed and evaluated by the City project team, and a final list of strategies was developed, incorporating the comments from all of the team members. A description of each of the recommended strategies is included below, and a summary table is included in Appendix C.

4.2.1 Mandatory
Mandatory requirements, new rules and ordinances can be the most effective strategies for achieving Zero Waste. The City will support these efforts through technical assistance, outreach and education, and reinforcement of desired behaviors. A description of these strategies is provided below.

4.2.1.1 Disposal Bans
To reduce discards that currently have recycling markets or uses, the City will consider product and material bans. Plastic water bottles, cardboard, yard trimmings and construction and demolition debris can be recycled, have available end-uses, and should not be disposed. These materials impact the collection system and take up space in landfills. The ban will start with government facilities, such as elimination of single-use water bottles at City facilities and events, and improved recycling of cardboard and landscaping debris.

4.2.1.2 C&D Ordinance Revision
Construction and demolition debris constitutes approximately 33% of the City’s overall disposal.

The existing ordinance requires all City-sponsored C&D projects, and all private C&D projects that are $50,000 or greater in value or 1,000 square feet or great to meet a minimum 70% diversion rate. This option will modify the existing Construction and Demolition Ordinance by increasing the diversion requirement from 70% to 90%. An amendment to the C&D ordinance will be required to implement the increased diversion requirements. The increase will be implemented in a phased approach, as follows:
• 75% in 2015
• 80% in 2020
• 85% in 2025
• 90% in 2030