Loading...
CC 2022-09-27 Agenda PackageCITY COUNCIL MEETING AGENDA SUMMARY Tuesday, September 27, 2022, 6:00 p.m. In person at: Arroyo Grande City Council Chambers 215 E. Branch Street, Arroyo Grande, CA 93420 AND via Zoom at: https://us02web.zoom.us/j/83255848846 Please click the link above to join the Zoom Meeting: Webinar ID: 832 5584 8846 Or by Telephone: 1-669-900-6833; 1-346-248-7799 In compliance with Assembly Bill (AB) 361, which allows for a deviation of teleconference rules required by the Ralph M. Brown Act, this City Council meeting is being conducted in a hybrid in-person/virtual format. Members of the public may participate and provide public comment on agenda items during the meeting in person at the location identified above, by joining the Zoom meeting, or by submitting written public comments to the Clerk of the Council at publiccomment@arroyogrande.org. Meetings will be broadcast live on Channel 20 and streamed on the City’s website and www.slo-span.org. 1.CALL TO ORDER 2.ROLL CALL 3.MOMENT OF REFLECTION 4.FLAG SALUTE 5.AGENDA REVIEW 5.a.Closed Session Announcements None. 5.b.Ordinances read in title only Move that all ordinances presented at the meeting shall be read by title only and all further readings be waived. 6.SPECIAL PRESENTATIONS 6.a.Update Regarding Countywide COVID-19 Efforts (McDONALD) Recommended Action: Receive update, accept public comments, discuss, and provide direction as necessary. 6.b.City Manager Communications (McDONALD) Recommended Action: Receive correspondence/comments as presented by the City Manager and Provide direction, as necessary. 6.c.Honorary Proclamation - Native American & Indigenous Peoples Heritage Month 2022 6.d.Honorary Proclamation - Fire Prevention Week 2022 7.COMMUNITY COMMENTS AND SUGGESTIONS This public comment period is an invitation to members of the community to present issues, thoughts, or suggestions on matters not scheduled on this agenda. Comments should be limited to those matters that are within the jurisdiction of the City Council. Members of the public may provide public comment in-person or remotely by joining the Zoom meeting utilizing one of the methods provided below. Please use the “raise hand” feature to indicate your desire to provide public comment. Click the link below to join the webinar: https://us02web.zoom.us/j/83255848846; Webinar ID: 832 5584 8846 • Or by Telephone: 1-669-900-6833; 1-346-248-7799 Press * 9 to “raise hand” for public comment • The Brown Act restricts the Council from taking formal action on matters not published on the agenda. In response to your comments, the Mayor or presiding Council Member may: • Direct City staff to assist or coordinate with you. • A Council Member may state a desire to meet with you. • It may be the desire of the Council to place your issue or matter on a future Council agenda. Please adhere to the following procedures when addressing the Council: • Comments should be limited to 3 minutes or less. • Your comments should be directed to the Council as a whole and not directed to individual Council members. • Slanderous, profane or personal remarks against any Council Member or member of the audience shall not be permitted. 8.CONSENT AGENDA The following routine items listed below are scheduled for consideration as a group. The recommendations for each item are noted. Any member of the public who wishes to comment on any Consent Agenda item may do so at this time. Any Council Member may request that any item be withdrawn from the Consent Agenda to permit discussion or change the recommended course of action. The City Council may approve the remainder of the Consent Agenda on one motion. 8.a.Consideration of Cash Disbursement Ratification (VALENTINE) Recommended Action: Ratify the attached listing of cash disbursements for the period of August 16 through August 31, 2022. 8.b.Consideration of Adoption of a Resolution Declaring a Continued Local Emergency Related Page 2 of 512 to the COVID-19 Pandemic and Authorizing the Continuance of Remote Teleconference Meetings of the Legislative Bodies Pursuant to Government Code Section 54953(e)(3) (McDONALD) Recommended Action: Adopt a Resolution declaring a continued local emergency related to the Coronavirus (COVID-19) pandemic and authorizing the continuance of remote teleconference meetings pursuant to Government Code Section 54953(e)(3). 8.c.Consideration of Adoption of a Resolution Approving the Amended and Restated Contract Between San Luis Obispo County Flood Control and Water Conservation District and the City of Arroyo Grande for Water Supply from Lopez Reservoir (ROBESON) Recommended Action: Adopt a Resolution approving execution of the amended and restated water supply contract with the San Luis Obispo County Flood Control and Water Conservation District. 8.d.Consideration of First Amendment to the Communications Site Lease Agreement (“Lease”) with T-Mobile West, LLC (“T-Mobile”), for the Operation of a Telecommunications Facility Located at Branch Mill Road (Reservoir 4) (McDONALD\CARMEL) Recommended Action: Approve the First Amendment to the Communications Site Lease Agreement (“Lease”) with T-Mobile West, LLC (“T-Mobile”), successor in interest to Cingular Wireless, for the operation of a telecommunications facility located at Branch Mill Road, commonly known as the Reservoir 4 site. 8.e.Approval of Minutes Approve the minutes of the Regular City Council Meeting of September 13, 2022. 8.f.Consideration of Conflict of Interest Code Biennial Review and Resolution Amending the City of Arroyo Grande Conflict of Interest Code (MATSON) Recommended Action: Adopt a Resolution approving an amended Conflict of Interest Code for designated positions. 8.g.Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus (MARTINEZ) Recommended Action: 1) Authorize the purchase of (a) thirteen (13) vehicles from Mullahey Ford, (b) vehicle fleet upfitting from Dana Safety Supply, (c) MDC Computers from Code3 Technologies, and (d) dash cameras from Safe Fleet; 2) Authorize a financing agreement for nine (9) Patrol vehicles and upfitting for a total not to exceed the amount of $749,103, through a 4-year municipal lease from Holman Capital Corporation at an APR of 4.57% (4 annual payments of approximately $201,583); 3) Authorize the cash purchase of four (4) vehicles and upfitting not to exceed the amount of $204,395; 4) Adopt a Resolution declaring existing Police vehicles as surplus and authorizing their sale; and 5) Authorize the City Manager to Page 3 of 512 execute all necessary documents. 8.h.Consideration to Award Construction Contract to G. Sosa Construction, Inc. for 2022 Pedestrian Crossing Improvement Project, PW 2021-08, and Authorization of Budget Adjustment for $90,618 from Unexpended FY 2021-22 CIP Budget Funds (ROBESON) Recommended Action: 1) Award a construction contract to G. Sosa Construction, Inc. in the amount of $321,202.75 and authorize the City Manager to approve change orders for up to 10% of the contract amount, $32,120.25, for unanticipated costs during the construction phase of the project (construction contract costs = $321,202.75 + $32,120.25 = $353,323); and 2) Approve a budget adjustment to appropriate $90,618 from unexpended FY 2021-22 Capital Improvement Program budget funds to cover the subject project expenditures. 8.i.Monthly Water Supply and Demand Update (ROBESON) Recommended Action: Receive and file the monthly Water Supply and Demand Report. 8.j.Consideration to Adopt a Resolution Pursuant to Public Contract Code Section 22050 Determining to Continue Work Under Emergency Contracts for the FCFA Station 1 Emergency Generator Replacement Project, PW 2021-09 (ROBESON) Recommended Action: 1) Receive and file an update of the emergency generator replacement project at the FCFA Station 1; and 2) Adopt a Resolution determining that there is a need to continue the emergency action for the replacement of the emergency generator in accordance with Public Contract Code Section 22050. 8.k.Consideration of Adoption of an Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Accessory Dwelling Units and Adoption of a Resolution Approving an Accessory Dwelling Unit Fee Waiver Program (PEDROTTI) Recommended Action: Adopt the Ordinance amending development regulations for ADUs and adopt a Resolution establishing the ADU Fee Waiver Program. 8.l.Consideration of Temporary Use Permit 22-011 Authorizing the Temporary Closure of Branch Street for Halloween in the Village on Monday, October 31, 2022; Applicant – Krista Bandy (PEDROTTI) Recommended Action: Adopt a Resolution approving Temporary Use Permit 22-011, authorizing the closure of East and West Branch Streets to accommodate Halloween in the Village. 8.m.Consideration of Adoption of a Resolution Amending the Citywide Combined Salary Schedule to Establish a Pay Schedule for a Temporary Part-Time Acting Capital Improvement Project Manager Page 4 of 512 (ROBESON) Recommended Action: Adopt the Resolution amending the Citywide Combined Salary Schedule to include a new position for a Temporary Part-Time Acting Capital Improvement Project Manager. 9.PUBLIC HEARINGS 9.a.Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 (PEDROTTI) Recommended Action: Introduce an Ordinance amending Title 16 of the AGMC regarding Short Term Rentals. 9.b.Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide (PEDROTTI) Recommended Action: Introduce an Ordinance establishing a permanent parklet program. 10.OLD BUSINESS None. 11.NEW BUSINESS 11.a.Discussion and Consideration of Approval of a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority and Appointment of a Representative to the Authority Board of Directors (McDONALD) Recommended Action: 1) Authorize the Mayor to execute a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority (Authority); and 2) appoint a member of the City Council to the Authority Board of Directors 12.CITY COUNCIL REPORTS 12.a.MAYOR RAY RUSSOM: California Joint Powers Insurance Authority (CJPIA)1. South San Luis Obispo County Sanitation District (SSLOCSD)2. Tourism Business Improvement District Advisory Board3. Other4. 12.b.MAYOR PRO TEM GEORGE: County Water Resources Advisory Committee (WRAC)1. Visit SLO CAL Advisory Board2. Other3. 12.c.COUNCIL MEMBER BARNEICH: Page 5 of 512 Audit Committee1. Homeless Services Oversight Council (HSOC)2. Zone 3 Water Advisory Board3. Other4. 12.d.COUNCIL MEMBER PAULDING: Air Pollution Control District (APCD)1. Brisco/Halcyon Interchange Subcommittee2. Council of Governments/Regional Transit Authority/ South County Transit (SLOCOG/SLORTA/SCT) 3. REACH SLO Advisory Commission4. Other 5. 12.e.COUNCIL MEMBER STORTON: Brisco/Halcyon Interchange Subcommittee1. Five Cities Fire Authority (FCFA)2. Integrated Waste Management Authority Board (IWMA)3. South County Chambers of Commerce Governmental Affairs Committee4. Other5. 13.COUNCIL COMMUNICATIONS Any Council Member may ask a question for clarification, make an announcement, or report briefly on his or her activities. In addition, subject to Council policies and procedures, Council Members may request staff to report back to the Council at a subsequent meeting concerning any matter or request that staff place a matter of business on a future agenda. Any request to place a matter of business for original consideration on a future agenda requires the concurrence of at least one other Council Member. 14.CLOSED SESSION None. 15.ADJOURNMENT All staff reports or other written documentation, including any supplemental material distributed to a majority of the City Council within 72 hours of a regular meeting, relating to each item of business on the agenda are available for public inspection during regular business hours in the City Clerk’s office, 300 E. Branch Street, Arroyo Grande. If requested, the agenda shall be made available in appropriate alternative formats to persons with a disability, as required by the Americans with Disabilities Act. To make a request for disability-related modification or accommodation, contact the Legislative and Information Services Department at 805-473-5400 as soon as possible and at least 48 hours prior to the meeting date. This agenda was prepared and posted pursuant to Government Code Section 54954.2 Agenda reports can be accessed and downloaded from the City’s website at www.arroyogrande.org If you would like to subscribe to receive email or text message notifications when agendas are posted, you Page 6 of 512 can sign up online through the “Notify Me” feature. City Council Meetings are cablecast live and videotaped for replay on Arroyo Grande’s Government Access Channel 20. The rebroadcast schedule is published at www.slo-span.org. Page 7 of 512 Item 6.c. Page 8 of 512 Item 6.d. Page 9 of 512 Item 8.a. MEMORANDUM TO: City Council FROM: Nicole Valentine, Administrative Services Director BY: Lynda Horejsi, Accounting Manager SUBJECT: Consideration of Cash Disbursement Ratification DATE: September 27, 2022 SUMMARY OF ACTION: Review and ratify cash disbursements. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: There is a $1,220,668.81 fiscal impact that includes the following items: • Accounts Payable Checks $824,557.50 • Payroll & Benefit Checks $396,111.31 RECOMMENDATION: Ratify the attached listing of cash disbursements for the period of August 1 6 through August 31, 2022. BACKGROUND: Cash disbursements are made weekly based on the submission of all required documents supporting the invoices submitted for payment. Prior to payment, Administrative Services staff reviews all disbursement documents to ensure that they meet the approval requirements adopted in the Municipal Code and the City’s Purchasing Policie s and Procedures Manual. ANALYSIS OF ISSUES: The attached listing represents the cash disbursements required of normal and usual operations during the period. The disbursements are accounted for in the FY 2021 -22 and FY 2022-23 budgets. Page 10 of 512 Item 8.a. City Council Consideration of Cash Disbursement Ratification September 27, 2022 Page 2 ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Approve staff’s recommendation; 2. Do not approve staff’s recommendation; or 3. Provide other direction to staff. ADVANTAGES:  The Administrative Services Department monitors payments of invoices for accountability, accuracy, and completeness using standards approved by the City Council.  Invoices are paid in a timely manner to establish goodwill with merchants.  Discounts are taken where applicable. DISADVANTAGES: There are no disadvantages identified in this recommendation. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. August 16 – August 31, 2022 – Accounts Payable Check Register 2. August 26, 2022 – Payroll and Benefit Check Register Page 11 of 512 CITY OF ARROYO GRANDECHECK LISTINGAUGUST 16 - AUGUST 31, 2022ATTACHMENT 1Line Check Date Check # Amount Description Acct # Vendor Name1 08/18/2022 294895 $ 4,839.46 09/22 RETIREE MEDICAL 010.4099.5136 ICMA RETIREMENT CORP2 08/18/2022 294895 368.87 09/22 RETIREE MEDICAL 220.4303.5136 ICMA RETIREMENT CORP3 08/18/2022 294895 462.03 09/22 RETIREE MEDICAL 010.0000.1111 ICMA RETIREMENT CORP4 08/19/2022 294896 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 KARA ADAMS5 08/19/2022 294897 281.50 TRAINING, TUITION- POLICE ACADEMY 010.4203.5501 ALLAN HANCOCK COLLEGE JCCD6 08/19/2022 294898 268.49 EMPLOYEE WELLNESS SUPPLIES 010.4201.5303 AMAZON CAPITAL SERVICES7 08/19/2022 294898 117.95 PUBLIC RELATIONS SUPPLIES 010.4201.5504 AMAZON CAPITAL SERVICES8 08/19/2022 294898 643.82 OFFICE SUPPLIES 010.4201.5201 AMAZON CAPITAL SERVICES9 08/19/2022 294898 158.78 UNIFORMS-BOOT/SHOE BUFFER 010.4203.5272 AMAZON CAPITAL SERVICES10 08/19/2022 294898 385.01 LOCK BOXES FOR PATROL FLEET 010.4204.5255 AMAZON CAPITAL SERVICES11 08/19/2022 294899 167.92 08/22 COMM MAINT 010.4204.5606 APPLIED TECHNOLOGY GROUP INC12 08/19/2022 294900 390.00 07/22 VILLAGE WATERING 010.4420.5605 ARROYO GRANDE IN BLOOM INC13 08/19/2022 294901 33.97 ACCT#235841-39568063 ALARM 220.4303.5303 AT & T14 08/19/2022 294901 198.33 ACCT#238451-01839190 RADIO 010.4145.5403 AT & T15 08/19/2022 294902 387.68 PD-4605 MAINT & REPAIR 010.4203.5601 BACK ON THE ROAD AUTOMOBILE16 08/19/2022 294902 949.88 PW-8 ENG TRUCK REPAIR 010.4301.5601 BACK ON THE ROAD AUTOMOBILE17 08/19/2022 294902 542.54 PD-4607 MAINT & REPAIR 010.4203.5601 BACK ON THE ROAD AUTOMOBILE18 08/19/2022 294903 274.20 PW-405 FILTERS, OIL 010.4420.5603 BERCHTOLD EQUIPMENT CO19 08/19/2022 294904 96.00 PEST CONTROL: WOMENS CLUB 010.4213.5303 BREZDEN PEST CONTROL, INC20 08/19/2022 294904 96.00 PEST CONTROL: WOMENS CLUB 010.4213.5303 BREZDEN PEST CONTROL, INC21 08/19/2022 294904 134.00 PEST CONTROL: FCFA 010.4213.5303 BREZDEN PEST CONTROL, INC22 08/19/2022 294905 13,845.40 07/22 PROF LEGAL SVCS 010.4003.5304 CARMEL & NACCASHA, LLP23 08/19/2022 294905 39.00 07/22 LITIGATION & RELATED MATTERS 010.4003.5304 CARMEL & NACCASHA, LLP24 08/19/2022 294906 987.20 ACCT#8245100960223598-PD DARK 010.4145.5401 CHARTER COMMUNICATIONS25 08/19/2022 294907 153.25 GREEN WASTE DUMP-GRANDMOTHERS PARK 220.4303.5307 COLD CANYON LANDFILL, INC26 08/19/2022 294908 100.01 (2) NICKEL PLATED BALL VALVE 220.4303.5603 CONTRACTORS MAINT.SERVICES27 08/19/2022 294909 1,350.00 SUMMER SESSIONS-MATH & READING 010.4424.5351 CROSSROADS LEARNING NETWORK28 08/19/2022 294910 315.00 WRITING FROM LIFE SUMMER SESSION 1 010.4424.5351 GAYLE CUDDY29 08/19/2022 294911 40.00 FTO TRAINING- POST PER DIEM 5 X $8 010.4203.5501 ANTHONY ESTRADA30 08/19/2022 294912 61.53 SOTO-MALE ADAPTER, COUPLER, BRASS BALL 010.4430.5605 FARM SUPPLY CO31 08/19/2022 294912 393.28 12' ALUMINUM ORCHARD LADDER 010.4420.5605 FARM SUPPLY CO32 08/19/2022 294913 1,082.08 TRASH CAN LINERS 010.4420.5605 FASTENAL COMPANY33 08/19/2022 294914 1,078.00 SERGER SEWING SUMMER SESSION 010.4424.5351 MARY JO GABEL34 08/19/2022 294915 4,032.49 GHD TRAFFIC REVIEW SERVICES 010.4301.5303 GHD INC35 08/19/2022 294916 200.00 REIMBURSE LUNCH-ACTIVE SHOOTER 010.4203.5501 GROVER BEACH POLICE DEPT36 08/19/2022 294917 185.00 STUMP GRINDER RENTAL 220.4303.5552 GROVER TOOL AND RENTALS37 08/19/2022 294917 295.00 CHIPPER RENTAL 220.4303.5552 GROVER TOOL AND RENTALS38 08/19/2022 294918 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 ANTHONY HERNANDEZ39 08/19/2022 294919 2,420.89 (31) 3/4" CUSTOMER VALVES 640.5946.7001 ICONIX WATERWORKS (US) INC40 08/19/2022 294919 171.05 60FT 4" SDR35 PVC GREEN PIPE 612.4610.5610 ICONIX WATERWORKS (US) INCPage 12 of 512 CITY OF ARROYO GRANDECHECK LISTINGAUGUST 16 - AUGUST 31, 2022ATTACHMENT 1Line Check Date Check # Amount Description Acct # Vendor Name41 08/19/2022 294919 $ 7,090.35 (31) METERBOXES W/LIDS 640.5946.7001 ICONIX WATERWORKS (US) INC42 08/19/2022 294920 13,980.00 COHESITY DATAPROTECT DELIVERED 010.4140.5303 ITSAVVY LLC43 08/19/2022 294921 710.00 CASH FOR GRASS- 710 SQFT 226.4306.5554 CATHY JORDANO44 08/19/2022 294922 1,294.02 (10) 5 GALL PAINT-SOTO FIELD 010.4430.5605 KELLY-MOORE PAINTS45 08/19/2022 294923 3,333.20 07/22 PROF FEES-HOTEL RFQ 010.0000.2563 KOSMONT & ASSOCIATES INC46 08/19/2022 294924 640.00 08/14 PICKLEBALL CLINIC 010.4424.5351 PRINCESS LEONG47 08/19/2022 294925 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 REBECCA MCKENZIE48 08/19/2022 294926 48.05 T8 FLUORESCENT LIGHTS 010.4213.5604 MINER'S ACE HARDWARE, INC49 08/19/2022 294926 (6.06) CREDIT RETURN 010.4213.5604 MINER'S ACE HARDWARE, INC50 08/19/2022 294926 10.76 DUCT TAPE 220.4303.5613 MINER'S ACE HARDWARE, INC51 08/19/2022 294926 31.42 FASTENERS 010.4430.5605 MINER'S ACE HARDWARE, INC52 08/19/2022 294926 47.70 VARNISH, PAINTBRUSH, LED BULB 010.4213.5604 MINER'S ACE HARDWARE, INC53 08/19/2022 294926 13.99 SANDPAPER 010.4213.5604 MINER'S ACE HARDWARE, INC54 08/19/2022 294926 9.77 (2) BAGS QUICK CRETE 010.4430.5605 MINER'S ACE HARDWARE, INC55 08/19/2022 294926 25.84 (2) BAGS GARDEN SOIL FOR TREES 010.4420.5605 MINER'S ACE HARDWARE, INC56 08/19/2022 294926 25.84 (2) BAGS GARDEN SOIL FOR TREES 010.4420.5605 MINER'S ACE HARDWARE, INC57 08/19/2022 294926 24.75 DUCT TAPE, GRAFITTI REMOVER 010.4213.5604 MINER'S ACE HARDWARE, INC58 08/19/2022 294926 9.70 THIMBLES, FASTENERS, PLASTIC PAIL 010.4420.5605 MINER'S ACE HARDWARE, INC59 08/19/2022 294926 13.55 LINK CHAIN, HOOK 010.4420.5605 MINER'S ACE HARDWARE, INC60 08/19/2022 294926 28.26 PD FLEET MAINT-INFLATOR GUN 010.4203.5601 MINER'S ACE HARDWARE, INC61 08/19/2022 294926 62.46 MARKING PAINT, WAND 220.4303.5613 MINER'S ACE HARDWARE, INC62 08/19/2022 294926 102.14 CLEANER, UTILITY KNIFE, TAPE MEASURE 010.4430.5605 MINER'S ACE HARDWARE, INC63 08/19/2022 294926 18.30 STENCIL, SPRAY PAINT 220.4303.5613 MINER'S ACE HARDWARE, INC64 08/19/2022 294926 69.96 RAID, AERATOR, SCREWDRIVER, CLEANER 010.4213.5604 MINER'S ACE HARDWARE, INC65 08/19/2022 294926 19.37 ANT BAIT 010.4213.5604 MINER'S ACE HARDWARE, INC66 08/19/2022 294926 22.68 GLUE, RESTROOM PLAQUE 010.4213.5604 MINER'S ACE HARDWARE, INC67 08/19/2022 294926 114.16 HEDGE SHEER, BYPASS LOPER, HACKSAWS 010.4420.5605 MINER'S ACE HARDWARE, INC68 08/19/2022 294927 1,665.59 PW-23 NEW ARROW STICK & INSTALLATION 010.4305.5601 NICK'S TELECOM (DBA)69 08/19/2022 294928 9.40 ELECTRIC-484 BAKEMAN 219.4460.5304 PACIFIC GAS & ELECTRIC CO70 08/19/2022 294929 25.50 UNIFORM CLEANING-PD ADMIN 010.4201.5303 PARAMOUNT CLEANERS71 08/19/2022 294929 471.00 UNIFORM CLEANING- PD PATROL 010.4203.5303 PARAMOUNT CLEANERS72 08/19/2022 294929 22.50 UNIFORM CLEANING-PD ADMIN 010.4201.5303 PARAMOUNT CLEANERS73 08/19/2022 294929 392.00 UNIFORM CLEANING-PD PATROL 010.4203.5303 PARAMOUNT CLEANERS74 08/19/2022 294929 44.00 UNIFORM CLEANING-PD SUPPORT SVCS 010.4204.5303 PARAMOUNT CLEANERS75 08/19/2022 294929 55.50 UNIFORM CLEANING-PD SUPPORT SVCS 010.4204.5303 PARAMOUNT CLEANERS76 08/19/2022 294930 558.00 CASH FOR GRASS- 558 SQFT 226.4306.5554 DAVID SANCHEZ77 08/19/2022 294931 6,750.00 STREET SWEEPING JULY-DEC 2022 220.4303.5303 SCA78 08/19/2022 294931 2,250.00 STREET SWEEPING JULY-DEC 2022 010.4307.5303 SCA79 08/19/2022 294932 50.00 PARK DEPOSIT REFUND-RANCHO GRANDE 010.0000.2206 MISTI SIMMS80 08/19/2022 294933 8.23 NDS DRAIN GRATE 010.4420.5605 SITEONE LANDSCAPE SUPPLY LLCPage 13 of 512 CITY OF ARROYO GRANDECHECK LISTINGAUGUST 16 - AUGUST 31, 2022ATTACHMENT 1Line Check Date Check # Amount Description Acct # Vendor Name81 08/19/2022 294933 $ 260.97 (2) 2.5 GALL HERBICIDE 220.4303.5613 SITEONE LANDSCAPE SUPPLY LLC82 08/19/2022 294934 80.10 REFUND OVRPYMT 212 MARIPOSA 010.0000.4181 SLO COUNTY ROOFING83 08/19/2022 294935 15.29 GAS SERVICES-350 S ELM 010.4145.5401 SOCALGAS84 08/19/2022 294935 128.98 GAS SERVICES-1375 ASH ST 010.4145.5401 SOCALGAS85 08/19/2022 294935 52.41 GAS SERVICES-200 N HALCYON 010.4145.5401 SOCALGAS86 08/19/2022 294936 250.00 FACILITY USAGE-SUMMER NEEDLE ARTS 010.4424.5251 ST JOHN'S LUTHERAN CHURCH87 08/19/2022 294937 30.00 ADULT SOFTBALL SCORER- 1 GAME X $15+1 HR ADMIN 010.4424.5352 HEATHER STRAUSBURG88 08/19/2022 294938 486.00 REFUND CIM WEEK 3- 2 CHILDREN 010.0000.4602 MACKENZIE TACKITT89 08/19/2022 294939 231.02 UNIFORMS-BLACK 010.4203.5272 TEMPLETON UNIFORMS90 08/19/2022 294940 100.00 UNIFORMS-NEW HIRE TRAINING SHIRTS 010.4203.5272 THE TOP SHOP91 08/19/2022 294941 124.00 REFUND SOCCER CAMP 010.0000.4605 DEICY TREJO92 08/19/2022 294942 349.97 FILL SAND, CONCRETE RECYCLING 220.4303.5613 TROESH RECYCLING, INC93 08/19/2022 294943 50.00 PARK DEPOSIT REFUND-ELM ST 010.0000.2206 MARICRUZ VEGA94 08/19/2022 294944 936.24 ACCT#208620661-00002- PD CELL 010.4201.5403 VERIZON WIRELESS95 08/19/2022 294944 942.62 ACCT#208620661-00002 PD CELL P 010.4201.5403 VERIZON WIRELESS96 08/19/2022 294945 28,569.62 06/22 TMD ASSESSMENT REMITTANCE 761.0000.2007 VISIT SLO CAL97 08/19/2022 294945 (571.39) 06/22 CITY ADMIN FEE 010.0000.4771 VISIT SLO CAL98 08/19/2022 294946 405.00 W/O 3452 R & R GRAND AT PED CROSSING 220.4303.5303 LEE WILSON ELECTRIC COMPANY INC99 08/19/2022 294947 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 SHERRIE WORRELL100 08/19/2022 294948 4,732.00 YOUTH BASKETBALL CAMPS SESSION 3 & 4 010.4424.5351 YOUTH EVOLUTION BASKETBALL101 08/19/2022 294948 2,240.00 YOUTH BASKETBALL CAMP SESSION 2 010.4424.5351 YOUTH EVOLUTION BASKETBALL102 08/19/2022 294949 74.28 UB Refund Cst #00026585 640.0000.2301 STEPHANIE BARCLAY103 08/19/2022 294950 72.69 UB Refund Cst #00026379 640.0000.2301 BRICE MOODY104 08/19/2022 294951 6.95 UB Refund Cst #00002294 640.0000.2301 RITA RODRIGUEZ105 08/19/2022 294952 24.27 UB Refund Cst #00028084 640.0000.2301 SCOTT SHANKLAND106 08/19/2022 294953 4,358.00 UNEMPLOYMENT-2 CLAIMANTS 010.4919.5142 CA ST EMPLOYMENT DEVEL DEPT107 08/26/2022 294954 24.18 AFLAC AFTER TAX: Payment 011.0000.2126 AFLAC INSURANCE108 08/26/2022 294954 814.78 AFLAC PRE TAX: Payment 011.0000.2126 AFLAC INSURANCE109 08/26/2022 294955 3,153.50 POLICE DEPT DUES: Payment 011.0000.2116 ARROYO GRANDE POLICE ASSN110 08/26/2022 294956 51,648.36 FEDERAL WITHHOLDING: Payment 011.0000.2104 CITY OF ARROYO GRANDE111 08/26/2022 294956 53,276.78 SOCIAL SECURITY: Payment 011.0000.2105 CITY OF ARROYO GRANDE112 08/26/2022 294956 13,133.56 MEDICARE: Payment 011.0000.2105 CITY OF ARROYO GRANDE113 08/26/2022 294957 2,506.23 CASDI: Payment 011.0000.2111 CA ST EMPLOYMENT DEVEL DEPT114 08/26/2022 294957 20,603.39 STATE WITHHOLDING: Payment 011.0000.2108 CA ST EMPLOYMENT DEVEL DEPT115 08/26/2022 294958 565.60 DEPT OF CHILD SUPPORT SERVICES: Payment 011.0000.2114 CA STATE DISBURSEMENT UNIT116 08/26/2022 294959 3,360.00 AG CAREER FIREFIGHTERS ASSN: Payment 011.0000.2115 FIVE CITIES PROF. FIREFIGHTERS117 08/26/2022 294960 3,556.65 DEFERRED COMPENSATION - EE %: Payment 011.0000.2117 ICMA RETIREMENT CORP118 08/26/2022 294960 11,843.59 DEFERRED COMPENSATION - EE: Payment 011.0000.2117 ICMA RETIREMENT CORP119 08/26/2022 294960 275.00 ROTH - AFTER TAX: Payment 011.0000.2117 ICMA RETIREMENT CORP120 08/26/2022 294960 816.66 DEFERRED COMPENSATION - ER: Payment 011.0000.2117 ICMA RETIREMENT CORPPage 14 of 512 CITY OF ARROYO GRANDECHECK LISTINGAUGUST 16 - AUGUST 31, 2022ATTACHMENT 1Line Check Date Check # Amount Description Acct # Vendor Name121 08/26/2022 294961 $ 62.80 PRE-PAID LEGAL SERVICES: Payment 011.0000.2125 LEGALSHIELD122 08/26/2022 294962 33,558.86 PERS RETIREMENT: Payment 011.0000.2106 PERS - RETIREMENT123 08/26/2022 294962 44,918.93 PERS RETIREMENT: Payment 011.0000.2106 PERS - RETIREMENT124 08/26/2022 294962 117.11 PERS BUYBACK - AFTER TAX: Payment 011.0000.2106 PERS - RETIREMENT125 08/26/2022 294962 1,178.02 PERS Employer Pick Up: Payment 011.0000.2106 PERS - RETIREMENT126 08/26/2022 294962 259.69 PERS BUYBACK - PRE TAX: Payment 011.0000.2106 PERS - RETIREMENT127 08/26/2022 294962 (0.06) ROUNDING DIFFERENCE 010.0000.4818 PERS - RETIREMENT128 08/26/2022 294963 1,178.56 SEIU DUES: Payment 011.0000.2118 S.E.I.U. LOCAL 620129 08/26/2022 294964 1,279.76 PARS: Payment 011.0000.2107 US BANK OF CALIFORNIA130 08/26/2022 294965 900.00 08/28 SUMMER CONCERT SERIES SOUND 010.4421.5504 ADEPT EVENTS LLC131 08/26/2022 294966 248.00 REFUND SPECIAL EVENT FEE 010.0000.4354 AGVIA132 08/26/2022 294966 50.00 PARK DEPOSIT REFUND-HERITAGE SQUARE 010.0000.2206 AGVIA133 08/26/2022 294966 120.00 PARK RENTAL REFUND-HERITAGE SQUARE 010.0000.4354 AGVIA134 08/26/2022 294966 50.00 PARK DEPOSIT REFUND-HERITAGE SQUARE 010.0000.2206 AGVIA135 08/26/2022 294967 50.00 PARK DEPOSIT REFUND-ELM ST 010.0000.2206 GRISEL ALCANTAR136 08/26/2022 294968 35.43 OFFICE SUPPLIES-SHIPPING LABEL 010.4212.5201 AMAZON CAPITAL SERVICES137 08/26/2022 294969 1,960.00 REPLACEMENT SIGN FOR ELM AND ASH ST 010.4430.5255 AVILA SIGN & DESIGN (DBA)138 08/26/2022 294969 1,960.00 REPLACEMENT SIGN FOR ELM AND ASH ST 010.4420.5255 AVILA SIGN & DESIGN (DBA)139 08/26/2022 294970 1,600.00 CASH FOR GRASS-1600 SQFT 226.4306.5554 CHARLES BARSTOW140 08/26/2022 294971 220.00 PW-27 OIL CHG 220.4303.5601 BOYER'S DIESEL141 08/26/2022 294971 365.00 PW-41 OIL CHG 220.4303.5601 BOYER'S DIESEL142 08/26/2022 294972 44,314.18 06/22 BLDG DEPT SVCS 010.4212.5303 BPR CONSULTING GROUP LLC143 08/26/2022 294973 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 DIANE BREBES144 08/26/2022 294974 500.00 JANITORIAL SERVICE FOR THE POLICE DEPARTMENT 010.4201.5615 BRENDLER JANITORIAL SERVICE145 08/26/2022 294974 1,135.00 JANITORIAL SERVICE FOR VARIOUS CITY BUILDINGS 010.4213.5615 BRENDLER JANITORIAL SERVICE146 08/26/2022 294975 2,793.00 (10) ACCU-TABS 600 LBS 640.4712.5274 BRENNTAG PACIFIC INC147 08/26/2022 294975 893.96 240 GALL HYPOCHLORITE 640.4712.5274 BRENNTAG PACIFIC INC148 08/26/2022 294976 200.00 REIMBURSEMENT FOR WORK BOOTS 640.4712.5148 BROOKS149 08/26/2022 294977 133.21 (2000) SERVICE REQUESTS 640.4710.5201 BURDINE PRINTING (DBA)150 08/26/2022 294977 102.36 PARKS & REC LABELS 010.4421.5504 BURDINE PRINTING (DBA)151 08/26/2022 294978 50.00 REFUND PARK DEPOSIT-HERITAGE SQUARE 010.0000.2206 CALVARY CHAPEL152 08/26/2022 294979 26.68 PW-14 WIPER BLADES 640.4712.5601 CARQUEST AUTO PARTS153 08/26/2022 294979 19.21 AIR FRESHENERS FOR CITY TRUCKS 010.4305.5255 CARQUEST AUTO PARTS154 08/26/2022 294979 20.66 PW-15 TOGGLE SWITCH 220.4303.5601 CARQUEST AUTO PARTS155 08/26/2022 294979 9.61 PW-41 FUEL FILTER 220.4303.5601 CARQUEST AUTO PARTS156 08/26/2022 294980 200.00 REIMBURSEMENT FOR WORK BOOTS 640.4712.5148 DEAN CASCIOLA157 08/26/2022 294981 200.00 REFUND DEPOSIT WOMENS CLUB 010.0000.2206 GELACIO CATALAN158 08/26/2022 294981 800.00 REFUND DEPOSIT WOMENS CLUB 010.0000.2206 GELACIO CATALAN159 08/26/2022 294982 100.00 PARK DEPOSIT REFUND-STROTHER # 2 & 3 010.0000.2206 JESSA CRABTREE160 08/26/2022 294983 338.46 KYOCERA COPIER LEASE 010.4421.5602 DE LAGE LANDEN FINANCIAL SVCSPage 15 of 512 CITY OF ARROYO GRANDECHECK LISTINGAUGUST 16 - AUGUST 31, 2022ATTACHMENT 1Line Check Date Check # Amount Description Acct # Vendor Name161 08/26/2022 294984 $ 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 SUZANNE DUNN162 08/26/2022 294985 75.00 PAS CLASS-POST PER DIEM (1 X $75) 010.4209.5501 ALEJANDRO ESTRADA163 08/26/2022 294986 800.00 08/28/22 SUMMER CONCERT SERIES 010.4421.5504 VANCE FAHIE164 08/26/2022 294987 74.02 RISER EXTENSIONS-SOTO 010.4430.5605 FARM SUPPLY CO165 08/26/2022 294988 905.38 TOILET PAPER 010.4420.5605 FASTENAL COMPANY166 08/26/2022 294989 272.81 (12) MASTER LOCKS-PARKS 010.4420.5605 FRANK'S LOCK & KEY167 08/26/2022 294989 120.00 (6) MASTER LOCKS-SOTO 010.4430.5605 FRANK'S LOCK & KEY168 08/26/2022 294990 75.00 PAS CLASS-POST PER DIEM (1 X $75) 010.4209.5501 CHAD GIESMANN169 08/26/2022 294991 200.00 REFUND DEPOSIT-WOMENS CLUB 010.0000.2206 JORGE GONZALEZ170 08/26/2022 294991 800.00 REFUND DEPOSIT -WOMENS CLUB 010.0000.2206 JORGE GONZALEZ171 08/26/2022 294992 429.35 PREPARE 2021 ANNUAL REPORT 640.4710.5303 GSI WATER SOLUTIONS172 08/26/2022 294993 50.00 PARK DEPOSIT REFUND-ELM ST 010.0000.2206 LUCIANA GUTIERREZ173 08/26/2022 294994 144.00 REFUND FALL PRESCHOOL T/TH 010.0000.4603 ANNA HANADA174 08/26/2022 294995 50.00 PARK DEPOSIT REFUND-RANCHO GRANDE 010.0000.2206 MICHAEL HANLEY175 08/26/2022 294996 191.00 REFUND PRESCHOOL FALL SESSION 010.0000.4603 PAULINA HOULDSWROTH176 08/26/2022 294997 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 DIANA JACOBO177 08/26/2022 294998 1,977.50 ART CAMPS-JULY & AUGUST 010.4424.5351 LYNNE LANE178 08/26/2022 294999 40.85 REFUND PARK DEPOSIT--STROTHER 010.0000.2206 LINDSAY LIGON179 08/26/2022 294999 84.15 REFUND PARK RENTAL -STROTHER 010.0000.4354 LINDSAY LIGON180 08/26/2022 294999 28.00 REFUND-USER CREDIT 010.0000.4605 LINDSAY LIGON181 08/26/2022 295000 900.00 SEWER MAIN VIDEO INSPECTION 612.4610.5610 MAINLINE UTILITY COMPANY182 08/26/2022 295001 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 RIANNA MALHERBE183 08/26/2022 295002 81.50 PAINT-AIR/VAC ENCLOSURE 640.4712.5610 MINER'S ACE HARDWARE, INC184 08/26/2022 295002 25.84 (2) BAGS TREE & SHRUB SOIL 010.4420.5605 MINER'S ACE HARDWARE, INC185 08/26/2022 295002 50.70 TAPE, PAINT CABLETIES, PLYWOOD 010.4213.5604 MINER'S ACE HARDWARE, INC186 08/26/2022 295002 25.83 CAULK GUN, ADHESIVE 220.4303.5613 MINER'S ACE HARDWARE, INC187 08/26/2022 295003 900.00 ONGOING MAP CHECKING SERVICES 010.4301.5303 MNS ENGINEERS INC188 08/26/2022 295004 300.00 PW-16 RESURFACE ROTORS 220.4303.5601 MULLAHEY FORD189 08/26/2022 295005 58.34 OFFICE SUPPLIES 010.4421.5201 ODP BUSINESS SOLUTIONS LLC190 08/26/2022 295005 65.95 OFFICE SUPPLIES 010.4421.5201 ODP BUSINESS SOLUTIONS LLC191 08/26/2022 295006 195.00 SERVICE CALL-COLOR PRINTER 010.4421.5602 OFFICE1192 08/26/2022 295007 58.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 MELISSA ORTIZ193 08/26/2022 295007 (8.00) CORRECT ACCT-WRONG AMT POSTED 010.0000.4354 MELISSA ORTIZ194 08/26/2022 295008 35.41 ELECTRIC-WELL#11 352 LA CANADA 640.4711.5402 PACIFIC GAS & ELECTRIC CO195 08/26/2022 295009 133.00 REFUND FALL PRESCHOOL T/TH 010.0000.4603 JAY PANCHAL196 08/26/2022 295010 50.00 PARK DEPOSIT REFUND-ELM ST 010.0000.2206 ANASTASHA PAOLILLO197 08/26/2022 295010 (26.00) BOUNCE HOUSE FEE 010.0000.4354 ANASTASHA PAOLILLO198 08/26/2022 295011 18,157.50 MATERIALS TESTING FOR 2021 STREET REPAIR 350.5638.7401 PAVEMENT ENGINEERING INC199 08/26/2022 295011 6,800.00 MATERIALS TESTING FOR 2021 STREET REPAIR 350.5638.7401 PAVEMENT ENGINEERING INC200 08/26/2022 295011 12,915.00 AMENDMENT #1 - ADDITIONAL DAYS 350.5638.7401 PAVEMENT ENGINEERING INCPage 16 of 512 CITY OF ARROYO GRANDECHECK LISTINGAUGUST 16 - AUGUST 31, 2022ATTACHMENT 1Line Check Date Check # Amount Description Acct # Vendor Name201 08/26/2022 295012 $ 56.00 PRIVATE TENNIS LESSONS 010.4424.5351 SUZANNE M PETRIE202 08/26/2022 295013 14,761.60 TRAFFIC WAY BRIDGE REPLACEMENT 350.5679.7501 QUINCY ENGINEERING INC203 08/26/2022 295014 93.00 PARK RENTAL REFUND-LESS ADMIN 010.0000.4354 MYKEL RANGEL204 08/26/2022 295014 50.00 PARK DEPOSIT REFUND-RANCHO GRANDE 010.0000.2206 MYKEL RANGEL205 08/26/2022 295015 5.38 COUNCIL CHAMBERS WATER 010.4213.5303 READYREFRESH BY NESTLE206 08/26/2022 295016 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 CHANTEL REYES207 08/26/2022 295016 103.00 PARK RENTAL REFUND-STROTHER 010.0000.4354 CHANTEL REYES208 08/26/2022 295016 150.00 PARK DEPOSIT REFUND-RANCHO GRANDE 010.0000.2206 CHANTEL REYES209 08/26/2022 295016 116.00 REFUND PARK RENTAL-RANCHO GRANDE 010.0000.4354 CHANTEL REYES210 08/26/2022 295017 50.00 PARK DEPOSIT REFUND-RANCHO GRANDE 010.0000.2206 RACHELLE ROMERO211 08/26/2022 295018 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 JOE ROULEAU212 08/26/2022 295019 50.00 PARK DEPOSIT REFUND-RANCHO GRANDE 010.0000.2206 BRIAN SCHWARTZENBACH213 08/26/2022 295020 4,233.60 SCIENCE DIPPITY SUMMER SESSION 8/8-8/12 010.4424.5351 SCIENCE DIPPITY INC214 08/26/2022 295021 50.00 PARK DEPOSIT REFUND-STROTHER 010.0000.2206 KAY SHISHIDO215 08/26/2022 295022 657.36 SUPPLIES-MAYORS MEETING 010.4001.5201 U.S. BANK216 08/26/2022 295022 114.10 TRADER JOES-MAYOR'S MEETING 010.4001.5501 U.S. BANK217 08/26/2022 295022 1,023.63 (2) VARIDESK 010.4002.5201 U.S. BANK218 08/26/2022 295022 115.00 PAYPAL-PUBLIC SECTOR EXCELLENCE 010.4002.5501 U.S. BANK219 08/26/2022 295022 199.00 DROPBOX SUBSCRIPTION 010.4002.5503 U.S. BANK220 08/26/2022 295022 280.11 MINERS-OFFICE SUPPLIES-UMBRELLAS 010.4101.5201 U.S. BANK221 08/26/2022 295022 445.00 TRAINING-EXECUTIVE RETREAT 010.4101.5501 U.S. BANK222 08/26/2022 295022 19.38 OFFICE SUPPLIES-AMAZON 010.4120.5201 U.S. BANK223 08/26/2022 295022 528.85 ZOOM 010.4140.5303 U.S. BANK224 08/26/2022 295022 899.98 GO DADDY SSL CERTIFICATIONS 010.4140.5303 U.S. BANK225 08/26/2022 295022 397.60 APC BATTERY-IT SAVVY 010.4140.5602 U.S. BANK226 08/26/2022 295022 155.18 OFFICE SUPPLIES 010.4201.5201 U.S. BANK227 08/26/2022 295022 110.54 EMPLOYEE RECOGNITION 010.4201.5504 U.S. BANK228 08/26/2022 295022 480.23 SUMMER CONCERT SERIES SUPPLIES 010.4421.5504 U.S. BANK229 08/26/2022 295022 515.00 NEW TIMES AD 010.4421.5504 U.S. BANK230 08/26/2022 295022 48.08 JOANN FABRICS-SUPPLIES FOR STARRY NIGHT DANCE 010.4424.5252 U.S. BANK231 08/26/2022 295022 (19.38) TARGET RETURN 010.4424.5252 U.S. BANK232 08/26/2022 295022 581.50 STARRY NIGHT DANCE SUPPLIES 010.4424.5252 U.S. BANK233 08/26/2022 295022 86.05 AMAZON-STARRY NIGHT SUPPLIES 010.4424.5252 U.S. BANK234 08/26/2022 295022 83.22 BRAND CREATIVE-PICKLEBALL BANNER 010.4424.5351 U.S. BANK235 08/26/2022 295022 585.00 CPRS RENEWAL 010.4424.5353 U.S. BANK236 08/26/2022 295022 61.69 RITE AID-ICE CREAM FOR CIM FIELD TRIP 010.4425.5259 U.S. BANK237 08/26/2022 295022 12.36 FOOD 4 LESS-WATER CIM HIKE 010.4425.5259 U.S. BANK238 08/26/2022 295022 263.79 SNACK SUPPLIES 010.4425.5259 U.S. BANK239 08/26/2022 295022 380.00 CONTRACT SERVICES 010.4425.5303 U.S. BANK240 08/26/2022 295022 451.13 SOTO POLARIS- FUEL PUMP, AIR FILTER 010.4430.5603 U.S. BANKPage 17 of 512 CITY OF ARROYO GRANDECHECK LISTINGAUGUST 16 - AUGUST 31, 2022ATTACHMENT 1Line Check Date Check # Amount Description Acct # Vendor Name241 08/26/2022 295022 $ 64.32 CHARGER FOR LAPTOP 640.4710.5201 U.S. BANK242 08/26/2022 295022 49.98 TRAINING CLASS-HANSON 640.4712.5501 U.S. BANK243 08/26/2022 295022 37.90 POSTAGE 010.4201.5208 U.S. BANK244 08/26/2022 295022 373.99 (100) SHOWER TIMERS 226.4306.5201 U.S. BANK245 08/26/2022 295022 418.76 TRAINING OTS-LODGING 010.4209.5501 U.S. BANK246 08/26/2022 295022 (241.36) CREDIT REFUND 511 TACTICAL 010.4203.5272 U.S. BANK247 08/26/2022 295022 1,184.18 PATROL EQUIPMENT 010.4203.5272 U.S. BANK248 08/26/2022 295022 308.32 UNIFORMS/EQUIPMENT 010.4203.5272 U.S. BANK249 08/26/2022 295022 63.85 UNIFORMS 010.4203.5272 U.S. BANK250 08/26/2022 295022 978.50 TRAINING-REGISTRATION TUITION-RAMIREZ 010.4203.5501 U.S. BANK251 08/26/2022 295022 204.97 TRAINING-LODGING 010.4203.5501 U.S. BANK252 08/26/2022 295022 750.00 TRAINING TUITION-FIREARMS INSTRUCTOR 010.4203.5501 U.S. BANK253 08/26/2022 295022 697.75 FLEET-MOTOR UPLIFTING 010.4203.5601 U.S. BANK254 08/26/2022 295022 2,103.74 FLEET-MOTOR WRAP, REPLACE WRAP 010.4203.5601 U.S. BANK255 08/26/2022 295022 169.21 FUEL 010.4203.5608 U.S. BANK256 08/26/2022 295022 102.89 FUEL 010.4203.5608 U.S. BANK257 08/26/2022 295022 88.24 FUEL 010.4203.5608 U.S. BANK258 08/26/2022 295022 602.00 CONTRACT SERVICES 010.4425.5303 U.S. BANK259 08/26/2022 295022 125.00 ABPA-TEST& APPLICATION COST 010.4420.5501 U.S. BANK260 08/26/2022 295022 175.91 SCHOOL YEAR SUPPLIES 010.4425.5255 U.S. BANK261 08/26/2022 295022 57.04 WALMART-WALL CLOCK & BATTERIES 010.4213.5604 U.S. BANK262 08/26/2022 295022 129.30 EBAY- GLASSES- REIMBURSED BY EMPLOYEE 010.4213.5604 U.S. BANK263 08/26/2022 295022 173.75 SNACK SUPPLIES 010.4425.5259 U.S. BANK264 08/26/2022 295022 201.95 PRESCHOOL SUPPLIES 010.4423.5253 U.S. BANK265 08/26/2022 295022 39.98 TRAINING-GALLUP 010.4002.5503 U.S. BANK266 08/26/2022 295022 13.54 SMART & FINAL-ART CLASS RECEPTION 010.4424.5251 U.S. BANK267 08/26/2022 295022 350.00 CONTRACT SVCS-RECORDS DESTRUCTION 010.4002.5303 U.S. BANK268 08/26/2022 295022 121.99 INTOXIMETERS 010.4203.5255 U.S. BANK269 08/26/2022 295022 115.00 MEMBERSHIP IIMC ANNUAL RENEWAL 010.4002.5503 U.S. BANK270 08/26/2022 295022 50.00 PAYPAL IIMC TRAINING 010.4002.5501 U.S. BANK271 08/26/2022 295022 19.99 DRI GALLUP -TRAINING 010.4002.5501 U.S. BANK272 08/26/2022 295022 211.98 CENTRAL MKT-PW ALL STAFF MTG FOOD/SUPPLIES 010.4307.5501 U.S. BANK273 08/26/2022 295022 85.48 MCA DIRECT-ELECTION SUPPLIES 010.4002.5201 U.S. BANK274 08/26/2022 295022 34.76 AMAZON-ELECTRON SUPPLIES 010.4002.5201 U.S. BANK275 08/26/2022 295022 30.00 MULE BAKERY-MEETING SUPPLIES 010.4002.5201 U.S. BANK276 08/26/2022 295022 53.10 AUTHORIZE.NET CC FEE 010.4145.5555 U.S. BANK277 08/26/2022 295022 450.00 TRAINING TUITION REGISTRATION 010.4203.5501 U.S. BANK278 08/26/2022 295022 30.00 TRAINING-TRAVEL 010.4201.5501 U.S. BANK279 08/26/2022 295022 1,345.24 LOWES-WOMENS CLUB FRENCH DOORS 350.5463.7001 U.S. BANK280 08/26/2022 295022 30.17 CDD SURFACE ADAPTER 010.4140.5602 U.S. BANKPage 18 of 512 CITY OF ARROYO GRANDECHECK LISTINGAUGUST 16 - AUGUST 31, 2022ATTACHMENT 1Line Check Date Check # Amount Description Acct # Vendor Name281 08/26/2022 295022 $ 122.65 COMMUNITY RELATIONS-HEFFER DUST 010.4201.5504 U.S. BANK282 08/26/2022 295022 14.86 OFFICE SUPPLIES 010.4201.5201 U.S. BANK283 08/26/2022 295022 169.04 BRAND CREATIVE-UNIFORM SHIRTS 010.4307.5201 U.S. BANK284 08/26/2022 295022 35.00 S COUNTY CHAMBER B'FAST MEETING-MCDONALD 010.4101.5501 U.S. BANK285 08/26/2022 295022 145.00 INT'L CODE COUNCIL SUBSCRIPTION 010.4130.5503 U.S. BANK286 08/26/2022 295022 25.00 TRIBE-VOLUNTEER THANK YOU 010.4424.5250 U.S. BANK287 08/26/2022 295022 40.00 EMPLOYEE RECOGNITION-MADD 010.4201.5504 U.S. BANK288 08/26/2022 295022 1,078.00 BALLISTIC HELMETS FOR NEW HIRES 010.4203.5272 U.S. BANK289 08/26/2022 295022 2.50 UNIFORMS/EQUIPMENT 010.4203.5272 U.S. BANK290 08/26/2022 295022 1,282.06 UNIFORMS/EQUIPMENT 010.4201.5272 U.S. BANK291 08/26/2022 295022 107.19 FUEL 010.4204.5608 U.S. BANK292 08/26/2022 295023 2,125.00 07/22 PROF SVCS-SUCCESSOR AGENCY 286.4103.5303 URBAN FUTURES, INC293 08/26/2022 295024 2,121.47 WALLACE STORMWATER MGMT 010.4301.5303 WALLACE GROUP A CALIF CORP294 08/26/2022 295025 806.78 NCMA STAFF EXTENSION SERVICES 640.4710.5303 WATER SYSTEMS CONSULTING INC295 08/26/2022 295026 50.00 PARK DEPOSIT REFUND-RANCHO GRANDE 010.0000.2206 SUSAN WILLIAMS296 08/26/2022 295027 210,000.00 RDA TAB BONDS-PRINCIPAL 286.0000.2659 WELLS FARGO BANK297 08/26/2022 295027 89,840.15 RDA TAB BONDS-INTEREST 286.4103.5802 WELLS FARGO BANK $ 824,557.50 Page 19 of 512 ATTACHMENT 2 . General Fund 339,884.87 5101 Salaries Full time 225,259.91 Streets Fund 16,240.63 5101 Volunteer Employee Retirement - American Rescue Plan Act 7,215.32 5102 Salaries Part-Time - PPT 2,470.14 Sewer Fund 9,468.03 5103 Salaries Part-Time - TPT 12,573.82 Water Fund 23,302.46 5105 Salaries OverTime 19,192.20 396,111.31 5106 Salaries Strike Team OT - 5107 Salaries Standby 1,676.90 5108 Holiday Pay 742.86 5109 Sick Pay 12,562.54 5110 Annual Leave Buyback - Administrative Services - 5111 Vacation Buyback - Information Services - 5112 Sick Leave Buyback - Community Development - 5113 Vacation Pay 7,339.20 Police 17,996.51 5114 Comp Pay 4,318.06 Public Works - Maintenance 409.03 5115 Annual Leave Pay 3,885.41 Public Works - Enterprise 786.66 5116 Salaries - Police FTO 348.19 Recreation - Administration - 5121 PERS Retirement 28,842.07 Recreation - Special Events - 5122 Social Security 21,263.50 Children In Motion - 5123 PARS Retirement 244.55 19,192.20 5126 State Disability Ins. 1,088.75 5127 Deferred Compensation 691.66 5131 Health Insurance 46,841.21 5132 Dental Insurance 2,944.82 5133 Vision Insurance 743.70 5134 Life Insurance 385.52 5135 Long Term Disability 603.42 5137 Leave Payouts - 5142 Unemployment Insurance - 5143 Uniform Allowance - 5144 Car Allowance 837.50 5146 Council Expense - 5147 Employee Assistance - 5148 Boot Allowance - 5149 Motor Pay 70.38 5150 Bi-Lingual Pay 150.00 5151 Cell Phone Allowance 1,035.00 396,111.31 OVERTIME BY DEPARTMENT: Total FCFA payroll cost for this period is $210,256.16. FCFA payroll and accounts payable expenditures are processed as part of the JPA financial services agreement between Arroyo Grande, Grover Beach and Oceano Community Services District. Arroyo Grande's portion of the FCFA annual budget is identified in the contractual services budget. CITY OF ARROYO GRANDE DEPARTMENTAL LABOR DISTRIBUTION PAY PERIOD 08/05/2022 - 08/18/2022 8/26/2022 BY FUND BY ACCOUNT Page 20 of 512 Item 8.b. MEMORANDUM TO: City Council FROM: Whitney McDonald, City Manager Timothy J. Carmel, City Attorney SUBJECT: Consideration to Adopt a Resolution Declaring a Continued Local Emergency Related to the COVID-19 Pandemic and Authorizing the Continuance of Remote Teleconference Meetings of the Legislative Bodies Pursuant to Government Code Section 54953(e)(3) DATE: September 27, 2022 SUMMARY OF ACTION: Adoption of the Resolution will continue the declared local emergency related to the COVID-19 pandemic and will also enable the City to continue to comply with the requirements of legislation, AB 361, to authorize the continued use of teleconferencing for meetings of the City’s legislative bodies. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: There are no direct fiscal impacts related to the proposed action; however, adoption of the Resolution will facilitate the ability for the City to request resources including financial support and reimbursement from the State Office of Emergency Services and the Federal Emergency Management Agency for costs incurred in preparation and/or response to the COVID-19 pandemic. RECOMMENDATION: Adopt a Resolution declaring a continued local emergency related to the Coronavirus (COVID-19) pandemic and authorizing the continuance of remote teleconference meetings pursuant to Government Code Section 54953(e)(3). BACKGROUND: As the City Council is aware, in accordance with Section 8.12.060 of the Arroyo Grande Municipal Code, the former City Manager, in his capacity as the Dire ctor of Emergency Services, proclaimed a local emergency on March 16, 2020, regarding the COVID -19 pandemic. The City Council ratified the proclamation at its regular meeting on March 24, 2020, and adopted resolutions declaring a continued local emergency since that time as the pandemic has persisted. Page 21 of 512 Item 8.b. City Council Consideration to Adopt a Resolution Declaring a Continued Local Emergency Related to the COVID-19 Pandemic and Authorizing the Continuance of Remote Teleconference Meetings of the Legislative Bodies Pursuant to Government Code Section 54953(e)(3) September 27, 2022 Page 2 In addition, AB 361 amended Government Code Section 54953, adding a new subsection (e) that permits legislative bodies, when there is a proclaimed State of Emergency declared by the Governor pursuant to Government Code Section 8625, to make a determination to authorize meeting remotely via teleconferencing as a result of the emergency. To do so, a resolution would need to be adopted in which the legislative body finds that meeting in person would present imminent risks to the health or safety of attendees, or that State or local officials have imposed or recommended measures to promote social distancing. The City Council first adopted a Resolution making findings in accordance with AB 361 and Government Code Section 54953(e) at its September 28, 2021 meeting. The Resolution is valid for thirty (30) days after teleconferencing for the first time under the new regulations. If the State of Emergency remains active after that 30 day period, the local agency may act to renew its resolution authorizing remote teleconferenced meetings by passing another resolution which includes findings that the State of Emergency declaration remains active, the local agency has reconsidered the circumstances of the State of Emergency, and the local agency has either identified: A) ongoing, direct impacts to the ability to meet safely in-person, or B) active social distancing measures as directed by relevant State or local officials. In the past, the City has adopted separate resolutions related to the continuing emergency declaration and the continuance of remote teleconference meetings pursuant to Government Code Section 54953(e)(3). Staff has combined the two items into one resolution to eliminate the need for separate agenda items. ANALYSIS OF ISSUES: Arroyo Grande Municipal Code Section 8.12.065(C) provides that the City Council is to “Review the need for a continuing emergency declaration at regularly scheduled meetings at least every twenty-one (21) days until the emergency is terminated.” Accordingly, the City Council has adopted the appropriate Resolutions declaring a continued local emergency related to the COVID-19 pandemic within the required 21-day time period since the ratification of the proclamation at its March 24, 2020 meeting. This item is being presented to the City Council to satisfy the requirements of Section 8.12.065(C) given the ongoing State of Emergency proclaimed by the Governor, the ongoing public health orders issued by the State, and the ongoing work requi red of City staff to respond to the pandemic and these proclamations and orders. In addition, the Resolution will allow the City to continue conducting its public meetings via teleconference. The Resolution includes continued findings based upon a determin ation that, as a result of the proclaimed State of Emergency in California due to the COVID-19 pandemic and its continued spread in San Luis Obispo County and Arroyo Grande Page 22 of 512 Item 8.b. City Council Consideration to Adopt a Resolution Declaring a Continued Local Emergency Related to the COVID-19 Pandemic and Authorizing the Continuance of Remote Teleconference Meetings of the Legislative Bodies Pursuant to Government Code Section 54953(e)(3) September 27, 2022 Page 3 through the Omicron, BA2 and other variants of SARS-CoV-2, which are far more transmissible than prior variants of the virus and, as even fully vaccinated individuals can spread the virus to others, holding meetings in person would present imminent risks to the health or safety of attendees. While the Resolution provides authority for the City to continue conducting public meetings remotely for the next thirty (30) days, the City has also determined to resume meetings in-person prior to the expiration of that thirty-day period, and conducted the City Council meetings beginning on March 8, 2022, as in-person meetings at Council Chambers while also retaining an option for the public, staff, and consultants to participate via Zoom. It is recommended that the proposed Resolution be adopted to continue to provide flexibility for future meetings of the City Council and its advisory bodies in the event that guidance from the State or County Health Officers changes within the next thirty (30) days. This flexibility will also allow members of the City Council or advisory bodies to attend meetings remotely if they also desire or if they are required to quarantine due to exposure to COVID-19. Based upon the foregoing, it is recommended that the City Council adopt the Resolution declaring the need to continue the emergency declaration an d also authorizing the continuance of remote teleconference meetings pursuant to Government Code Section 54953(e)(3). ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Adopt the Resolution declaring the need to continue the declared local emergency and authorizing the continuance of remote teleconference meetings; 2. Do not adopt the Resolution; or 3. Provide other direction to staff. ADVANTAGES: Adoption of the Resolution will satisfy the requirement of the Arroyo Grande Municipal Code regarding the periodic review of the declared local emergency related to the COVID- 19 pandemic. It will also satisfy the requirements of Government Code Section 54953(e)(3) and allow the City to safely continue carrying out its business in a manner that will minimize the risk of contracting COVID-19 for everyone involved. DISADVANTAGES: No disadvantages have been identified to adopting the Resolution. ENVIRONMENTAL REVIEW: No environmental review is required for this item. Page 23 of 512 Item 8.b. City Council Consideration to Adopt a Resolution Declaring a Continued Local Emergency Related to the COVID-19 Pandemic and Authorizing the Continuance of Remote Teleconference Meetings of the Legislative Bodies Pursuant to Government Code Section 54953(e)(3) September 27, 2022 Page 4 PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed Resolution Page 24 of 512 ATTACHMENT 1 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING A CONTINUED LOCAL EMERGENCY RELATED TO THE CORONAVIRUS (COVID- 19) PANDEMIC AND AUTHORIZING THE CONTINUANCE OF REMOTE TELECONFERENCE MEETINGS OF THE LEGISLATIVE BODIES OF THE CITY OF ARROYO GRANDE PURSUANT TO GOVERNMENT CODE SECTION 54953(e) WHEREAS, in accordance with Section 8.12.060 of the Arroyo Grande Municipal Code, the former City Manager, in his capacity as the Director of Emergency Services proclaimed a local emergency on March 17, 2020, regarding the COVID-19 pandemic; and WHEREAS, the City Council ratified the emergency proclamation through adoption of Resolution No. 4974 at its regular meeting on March 24, 2020; and WHEREAS, Arroyo Grande Municipal Code Section 8.12.065(C) provides that the City Council is to review the need for a continuing emergency declaration at regularly scheduled meetings at least every twenty-one (21) days until the emergency is terminated; and WHEREAS, the City Council has adopted Resolutions declaring a continued local emergency related to the coronavirus (COVID-19) pandemic on April 14, April 28, May 12, May 26, June 9, June 23, July 14, August 11, August 25, September 8, September 22, October 13, October 27, November 10, November 24, December 8, 2020, January 12, January 26, February 9; February 23; March 9, March 23, April 13, April 27, May 11, May 25, June 8, June 22, July 27, August 10, August 24, September 14, September 28, October 12, October 26, November 9, November 23, December 14, 2021, January 11, January 25, February 8, February 22, March 8, March 22, April 12, April 26, May 10, May 24, June 14, June 28, July 26, August 9, August 23, and September 13, 2022; and WHEREAS, the Secretary of Health and Human Services Director issued a Determination that a Public Health Emergency Exists and has existed as of January 27, 2020; and WHEREAS, the President of the United States declared a State of National Emergency; the Governor of the State of California has proclaimed a State of Emergency for the State of California and issued Executive Orders and direction regarding measures to mitigate the spread of cases of COVID-19 within the State of California and all recitals set forth therein, are included as though fully set forth herein; and WHEREAS, subsequently, in March 2020, in response to the COVID -19 pandemic, Governor Newsom issued Executive Orders N-25-20 and N-29-20. These orders suspended certain elements of the Brown Act and specifically allowed for legislative Page 25 of 512 RESOLUTION NO. PAGE 2 bodies as defined by the Brown Act to hold their meetings entirely electronically with no physical meeting place. On June 11, 2021, Governor Newsom issued Executive Order N - 08-21 which provided that the provisions in Executive Order N-29-20 suspending certain elements of the Brown Act would continue to apply through September 30, 2021; and WHEREAS, on September 16, 2021 Governor Newsom signed AB 361, which added subsection (e) to Government Code section 54953 of the Brown Act, and makes provision for remote teleconferencing participation in meetings by members of a legislative body, without compliance with the requirements of Government Code section 54953(b)(3), subject to the existence of certain conditions; and WHEREAS, a required condition of AB 361 is that a state of emergency is declared by the Governor pursuant to Government Code section 8625, proclaiming the existence of conditions of disaster or of extreme peril to the safety of persons and property within the State caused by conditions as described in Government Code sectio n 8558; and WHEREAS, the City Council has adopted a Resolution making findings in accordance with AB 361 and Government Code Section 54953(e) authorizing remote teleconference meetings on September 28, October 26, November 23, and December 14, 2021, and o n January 25, February 22, March 22, April 12, May 10, June 14, June 28, and July 26, 2022; and WHEREAS, the COVID-19 pandemic continues to spread rapidly worldwide and in the U.S., continuing to present an immediate and significant risk to public health and safety, and resulting in serious illness or death to vulnerable populations, including the elderly and those with underlying health conditions. NOW, THEREFORE BE IT RESOLVED by the City Council of the City of Arroyo Grande that: 1. All recitals set forth above, are true, correct and incorporated herein. 2. A local emergency is declared to continue to exist throughout the City of Arroyo Grande, and the City has been undertaking, and will continue through termination of this emergency to undertake necessary measures and incur necessary costs, which are directly related to the prevention of the spread of COVID -19 and are taken in furtherance of: the Secretary of Health and Human Services’ determination that a public health emergency has existed since January 27, 2020; the Governor’s Proclamation of a State of Emergency on March 4, 2020; the President of the United States’ Declaration of a National Emergency on March 13, 2020 and the City Director of Emergency Services’ Proclamation of Local Emergency on March 17, 2020; and related orders and directives. Page 26 of 512 RESOLUTION NO. PAGE 3 3. In accordance with the requirements of Government Code Section 54953(e)(3), the City Council of the City of Arroyo Grande hereby finds and determines that it has reconsidered the circumstances of the State of Emergency and that the State of Emergency continues to exist and to directly impact the ability to meet safely in person due to the COVID-19 pandemic, and its continued spread in San Luis Obispo County and Arroyo Grande through the Omicron,BA2 and other variants of SARS-CoV-2, which are far more transmissible than prior variants of the virus, and can be spread to others even by fully vaccinated individuals, and therefore holding meetings in person would present imminent risks to the health or safet y of attendees. 4. The City Manager and legislative bodies of the City of Arroyo Grande are hereby authorized and directed to take all actions necessary to carry out the intent and purpose of this Resolution including, continuing to conduct open and public remote teleconferencing meetings in accordance with the requirements of Government Code section 54953(e) and other applicable provisions of the Brown Act. 5. This Resolution shall take effect immediately upon its adoption and shall be effective for thirty (30) days after its adoption, subject to being extended for an additional 30 day period by the City Council’s adoption of a subsequent resolution in accordance with Government Code section 54953(e)(3) to further extend the time during which the legislative bodies of the City of Arroyo may continue to teleconference without compliance with paragraph (3) of subdivision (b) of Government Code section 54953. On motion of Council Member , seconded by Council Member , and by the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was approved this 27th day of September, 2022. Page 27 of 512 RESOLUTION NO. PAGE 4 CAREN RAY RUSSOM, MAYOR ATTEST: JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: WHITNEY MCDONALD, CITY MANAGER APPROVED AS TO FORM: TIMOTHY J. CARMEL, CITY ATTORNEY Page 28 of 512 Item 8.c. MEMORANDUM TO: City Council FROM: Bill Robeson, Assistant City Manager/Public Works Director BY: Shane Taylor, Utilities Manager SUBJECT: Consideration of Adoption of a Resolution Approving the Amended and Restated Contract Between San Luis Obispo County Flood Control and Water Conservation District and the City of Arroyo Grande for Water Supply from Lopez Reservoir DATE: September 27, 2022 SUMMARY OF ACTION: Adoption of the proposed Resolution will approve the amended and restated contract between San Luis Obispo County Flood Control and Water Conservation District (District) and the City of Arroyo Grande for a water supply from Lopez Reservoir. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The Fiscal Year 2022-23 budget includes $3,828,355 for the operation and maintenance, and debt service, for the Lopez Project. The amended and restated contract will have no impact on the current City debt obligation to the project. The contract will allow the District to move forward with refunding the bonds associated with the completed Lopez Dam Seismic Retrofit Project, so long as the refunding will not negatively impact the City’s repayment obligations. The refunding process will save an estimated minimum of $50,000/year for the District. The staff time required to administer the contract should be similar to the current contract. RECOMMENDATION: Adopt a Resolution approving execution of the amended and restated water su pply contract with the San Luis Obispo County Flood Control and Water Conservation District. BACKGROUND: The Lopez Water System is comprised of Lopez Dam, Reservoir, water treatment facility, and distribution pipeline. The Lopez Water System supplies wa ter to various south County municipalities via Water Supply Contracts (Contracts) within Zone 3 of the District. The existing Contracts between the District and the Zone 3 Contractors (Contractors) were restated and amended in 2000 from the terms of the original 1966 Contracts in response Page 29 of 512 Item 8.c. City Council Consideration of Adoption of a Resolution Approving the Amended and Restated Contract Between San Luis Obispo County Flood Control and Water Conservation District and the City of Arroyo Grande for Water Supply from Lopez Reservoir September 27, 2022 Page 2 to the need for obtaining bonds for the State-mandated Lopez Dam Seismic Retrofit Project. The Contracts were further amended in 2010 to allow for bond refinancing. The Contracts establish the annual water entitlements for each of the Contractors and downstream releases, which are based on the safe yield of the reservoir and the reservoir capacity. On August 23, 2022, the San Luis Obispo County Board of Supervisors approved an Amended and Restated Zone 3 Contract. Once all other Zone 3 Contractors, including the City, approve the amended contract, the District will move forward implementing the new contract, including refunding the existing bonds to obtain more favor able terms for the District and the Contractors. ANALYSIS OF ISSUES: The Contractors wish to again restate and amend the Contracts to provide storage rights for each of the Contractors to store their unused entitlement, surplus water, and State Water Project water year over year in Lopez Reservoir and to permit the refunding of the bonds associated with the completed Lopez Dam Seismic Retrofit Project in order to reduce the costs of debt service. The current Contracts operate under a “use it or lose it” principle. If a contractor does not use their annual entitlement of water during the water year, their unused entitlement becomes surplus water that is available for all Contractors to purchase in the following water year. If the surplus water is not used within the following water year, it reverts back to the District, forfeiting the fixed costs paid by the Contractors associated with their full entitlement. A subcommittee of the Zone 3 Technical Advisory Committee worked to develop the proposed amended and restated contract to improve management of the Lopez Water Supply System. The proposed contract provisions will provide the Contractors with the following management tools:  The ability for each Contractor to store unused entitlement water, or surplus water, for their use in future years;  Improve flexibility of multi-year water resource planning;  Allow the Contractors greater opportunities for enhanced conjunctive use (the coordinated use of groundwater and surface water supplies to meet demand) of their water supply portfolios;  Provide incentives for State Water sub-contractors to import State Water and preserve water in Lopez Lake; and  The ability of the District to move forward with refunding the bonds associated with the completed Lopez Dam Seismic Retrofit Project to lower costs. Page 30 of 512 Item 8.c. City Council Consideration of Adoption of a Resolution Approving the Amended and Restated Contract Between San Luis Obispo County Flood Control and Water Conservation District and the City of Arroyo Grande for Water Supply from Lopez Reservoir September 27, 2022 Page 3 Significant Revisions The following items were modified in the proposed Contract to incorporate language to allow Contractor storage rights, to address re-financing of the Lopez Dam Seismic Retrofit Project bonds, as well as to clarify and modernize the terminology of the Contracts and several of their basic provisions:  Individual Contractor storage – added (Articles 4, 7, 9, 15, 21) o Provides storage rights to Contractors for unused entitlements. At the end of the water year, the Contractors will have the option to place unused entitlements into the Contractor’s storage account. While Contractors will continue to be required to pay for their full entitlement costs at the beginning of the water year, including operations and maintenance, capital reserve, and debt service costs, the District will issue a credit to the Contractors for the variable costs of any unused water that they placed into storage. Variable costs are discussed further below and defined in more detail in Article 14. When the stored water is used, the Contractor will pay the variable costs for that water at that time. o Stored water is subject to evaporation losses, as addressed in Article 7. o Stored water is subject to continuous spillway losses, as described i n Articles 4 and 7 and discussed in more detail below.  Surplus Water cost calculations – modified (Article 4) o Clarifies that Surplus Water is defined as the remaining portion of the annual Safe Yield of the Reservoir after distribution of entitlements, downstream releases, and calculated stored water. Surplus water is offered to Contractors first and may be purchased proportionately to the Contractor’s share of project water. o The cost of surplus water to Contractors is limited to the variable charge calculated to cover the costs to the District for pumping and chemicals , as described in more detail below.  Storage of State Water Project Water through in-lieu exchange – added (Article 7) o Allows Contractors to store State Water at Lopez Reservoir through the initiation of an exchange of State Water Project Water for Lopez Water. In these instances, State Water stored through Contractor-initiated exchanges are subject specific water loss events, such as evaporation and spillway losses or force majeure events. o In the case of a disruption of water delivery, the District may deliver State Water to Contractors in-lieu of Lopez Water.  Address downstream release obligations – modified (Articles 4, 7, 17) o Unused downstream releases will be declared surplus and then offered up for sale to the Contractors based on entitlement percentages. When this water is stored, the Contractor will pay only the delivery charge that is calculated for that water year when the agency takes delivery of stored water. Page 31 of 512 Item 8.c. City Council Consideration of Adoption of a Resolution Approving the Amended and Restated Contract Between San Luis Obispo County Flood Control and Water Conservation District and the City of Arroyo Grande for Water Supply from Lopez Reservoir September 27, 2022 Page 4  Turnout delivery capacity limitations – modified (Article 9)  Variable charges calculation changes – modified (Article 14) o Variable charges will be determined each year by, first, dividing the District’s actual cost of pumping energy and chemical charges during the fiscal year by the total acre-feet of Lopez water delivered to all Contractors and then, second, multiplying this acre-foot charge by the number of acre-feet of Lopez water delivered to the Contractor during that fiscal year.  Bond re-financing legal language – added (Article 34) The new storage provisions incorporated into the revised agreement enable Contractors to store unused allocations of Lopez Project water, as well as exchanged State Water Project Water, indefinitely. The proposed Amended and Restated Agreement does not contain caps or volumetric limits on storage rights but instead allow the Contractors to store unused Lopez Project allocations or exchanged State Water Project Water until continuous spillover occurs, at which point any stored water rights are reduced by the amount of water lost to spillover with stored State Water lost first and stored Lopez Water lost second. The result of these contract revisions will likely increase the amount of water available within Lopez Reservoir at any given time as Contractors are provided contractual incentives to store rather than use their allocations . This approach will increase water resiliency in times of drought as Contractors will no longer face the need to pay for their entire Lopez Project allocations if they choose to utilize other water sources to meet demand. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Adopt the proposed Resolution to approve the amended and restated contract; 2. Do not adopt the proposed Resolution to approve the amended and restated contract and propose revisions to the contract to be presented for consideration by the Zone 3 Advisory Committee and to the District; 3. Do not adopt the proposed Resolution to approve the amended and restated contract; or 4. Provide other direction to staff. ADVANTAGES: Approval and execution of the Amended and Restated Contract is intended to enhance the Contractors’ ability to manage their water supplies, improve multi-year water planning, and provide opportunities to re-finance bonds. These actions will ensure that the water supplies from Lopez Lake are managed in as prudent a manner as possible. Page 32 of 512 Item 8.c. City Council Consideration of Adoption of a Resolution Approving the Amended and Restated Contract Between San Luis Obispo County Flood Control and Water Conservation District and the City of Arroyo Grande for Water Supply from Lopez Reservoir September 27, 2022 Page 5 DISADVANTAGES: Increased record keeping, tracking of water storage, evaporation, and variable costs are considerations when stored water is delivered. ENVIRONMENTAL REVIEW: A Negative Declaration (ND) for this contract was completed by the District Environmental Division staff, and the Board of Supervisors adopted the ND on August 23, 2022. It is recommended that the City Council rely on the ND adopted by the Board of Supervisors for consideration and approval of the Amended and Restated Contract, as proposed in the attached Resolution (Attachment 1). PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed Resolution making Responsible Agency Findings Pursuant to the California Environmental Quality Act (CEQA) for the Amended and Restated Water Supply Contract Project for Zone 3 and Approving Execution of an Amended and Restated Water Supply Contract between the City of Arroyo Grande and the San Luis Obispo County Flood Control and Water Conservation District. 2. Zone 3 Amended and Restated Contract 3. County of San Luis Obispo Notice of Intent and Negative Declaration 4. County of San Luis Obispo Resolution Approving Execution of Amended and Restated Water Supply Contracts with the Zone 3 Contractors and Adopting a Negative Declaration Pursuant to Public Resources Code Section 21000 Et Seq. (CEQA) 5. Response to Comments on the Lopez Water Project Contract Changes Draft Negative Declaration Page 33 of 512 ATTACHMENT 1 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE MAKING RESPONSIBLE AGENCY FINDINGS PURSUANT TO THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) FOR THE AMENDED AND RESTATED WATER SUPPLY CONTRACT PROJECT FOR ZONE 3 AND APPROVING EXECUTION OF AN AMENDED AND RESTATED WATER SUPPLY CONTRACT WITH THE SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT WHEREAS, the City of Arroyo Grande (“the City”), entered into a Water Supply Contract (Contract) with the San Luis Obispo County Flood Control and Water Conservation District (District) on October 24, 1966, which was subsequently amended and restated and pursuant to which the City receives a water entitlement from Lopez Reservoir; and WHEREAS, on or around the same time, other local agencies (said local agencies and the City are collectively referred to as the Zone 3 Contractors) entered into substantially similar Water Supply Contracts with the District and subsequent amendments and restatements thereto pursuant to which they also receive a water entitlement from Lopez Reservoir (the Contract and the Water Supply Contracts with the other Zone 3 Contractors as previously amended and restated are collectively referred to as the Contracts); and WHEREAS, the Zone 3 Contractors wish to again amend and restate the Contracts to (i) provide storage rights for each of the Zone 3 Contractors to store their unused entitlement, surplus water and State Water Project Water year over year in Lopez Reservoir and (ii) permit the refunding of the bonds associated with the completed Lopez Dam Seismic Retrofit Project in order to reduce the costs of debt service (Project) (which purposes may advance on a similar schedule or on different schedules); and WHEREAS, the City is a responsible agency for purposes of environmental review of the Project under the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21000 et seq. and the CEQA Guidelines; and WHEREAS, District staff prepared a Negative Declaration for the Project which was approved by the Environmental Division Manager, and which concludes that the Project will not have a significant effect on the environment and that no mitigation measures are required; and WHEREAS, prior to commencement of preparation of the Negative Declaration, District staff conducted early consultation with potentially affected local, State and Federal Page 34 of 512 RESOLUTION NO. PAGE 2 agencies, Native American groups and other potentially interested parties but no substantive comments were received; and WHEREAS, notice of intent to adopt the proposed Negative Declaration was also published in a local newspaper and circulated to the relevant, local, State and Federal agencies through the State Clearinghouse and by mail and the thirty (30) day review period for the Project ended on February 28, 2022; the only comments received were from the County of San Luis Obispo Department of Parks and Recreation opining that the Project would have potential net benefits for recreational use; and WHEREAS, the form of the amended and restated Contracts and the Negative Declaration was presented to and considered by the Board of Supervisors, acting as the governing board of the District (District Board), on August 23, 2022, together with a summary of all comments received during the public review process, and the District Board approved the form of the amended and restated Contract and adopted the Negative Declaration, finding that there is no substantial evidence that the Project will have a significant effect on the environment; and WHEREAS, the City has reviewed and considered the information contained in the Negative Declaration and the whole environmental record as well as the proposed Amended and Restated Water Supply Contract between the District and the City. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DOES HEREBY RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS: The foregoing recitals are true and correct. 1. Negative Declaration. The City Council has considered the environmental impacts of the Project as shown in the Negative Declaration prior to making a decision on the Project. In its independent judgment and analysis, the City Council finds the Negative Declaration is adequate for City use to authorize execution of the Amended and Restated Water Supply Contract between the District and the City. More specifically, on the basis of the environmental record before the City Council, including comments received, the City Council has determined that the Amended and Restated Water Supply Contract will not have a significant effect on the environment. 2. Approval of Amended and Restated Supply Contract. The City Council hereby approves and authorizes the Mayor to sign the Amended and Restated Water Supply Contract with the District presented to this Council. To accommodate the possibility of financing purposes proceeding on a different schedule than water storage purposes reflected in the Amended and Restated Water Supply Contract, the amendments in the Amended and Restated Water Supply Contract related to Page 35 of 512 RESOLUTION NO. PAGE 3 financing matters may instead be effected under a separate amendment document which the City Council hereby approves and authorizes the Mayor to execute and deliver, with such changes therein as the Mayor shall approve, such approval to be conclusively established by the execution and delivery thereof subject to approval of such changes by the City Attorney. 3. Effective Date. This Resolution shall take effect immediately upon its passage and adoption. On motion of Council Member ____________, seconded by Council Member _________, and by the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was approved this 27th day of September, 2022. Page 36 of 512 RESOLUTION NO. PAGE 4 CAREN RAY RUSSOM, MAYOR ATTEST: JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: WHITNEY MCDONALD, CITY MANAGER APPROVED AS TO FORM: TIMOTHY J. CARMEL, CITY ATTORNEY Page 37 of 512 AMENDED AND RESTATED CONTRACT BETWEEN SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT AND THE CITY OF ARROYO GRANDE FORA WATER SUPPLY Dated as of August 2022 ATTACHMENT 2 Page 38 of 512 Table of Contents Article 1. Definition s ...................................................................................................................... 4 Article 2 . Term of Contra ct .......................................................................................................... 14 Article 3. Validation ...................................................................................................................... 15 Article 4 . Dis t ribution and Sa les of Project Water ..................................................................... 15 (A) Legally Required Water Releases ............................................................................. 15 (B) Ent itlements ............................................................................................................... 15 (C) Surplus Water Rates .................................................................................................. 16 (D) Su r plus Wate r ............................................................................................................ 18 (E) Sto r ed Water .............................................................................................................. 19 Article 5. Water Shortages .......................................................................................................... 19 Article 6. Completion of Seismic Remediation Improvements ................................................ 19 Article 7. Delivery and Storage of Water .................................................................................... 21 (A) Water Furnished to the Agency ................................................................................ 22 (B) Sto r age of Lope z Water ............................................................................................. 22 (C) Sto r age of State Water Project Wate r ...................................................................... 24 Article 8. Measurement ............................................................................................................... 26 Article 9. Ti me for Delivery of Project Water ............................................................................. 27 Article 10. Responsibility for Delivery and Dist r ibution of Water Beyond De li very Points ................................................................................................................. 28 Article 11. Operation and Maintenance of Project and Water En t erp r ise .............................. 29 Article 12. Water Quality ............................................................................................................. 33 Article 13 . Curtailment of Delivery of Project Water fo r Maintenance Purposes ................... 33 Article 14. Rate and Metho d of Payment.. ................................................................................. 34 (A) Allocation of Total Project Costs and Debt Service ................................................. 34 (B) Agency Contract Payments ....................................................................................... 35 (C) Agency Credits against Contract Payments ............................................................. 36 (D) Variable Charges ........................................................................................................ 38 (E) Use by District of Total Contract Payments ............................................................. 38 Article 15 . Take-or-Pay Obligation of Agency ............................................................................ 39 Page 39 of 512 Article 16. Pledge; Establishment and Collection of Rates and Charges ................................. 39 Article 17 . Default ........................................................................................................................ 40 Article 18. Failure to Levy, Set, or Collect Taxes, Rates, and Charges ...................................... 42 Article 19. Area Served by Agency .............................................................................................. 44 Article 20. Changes in Organization of Agency ......................................................................... 44 Article 21. Agency's Obligations Several and Not Joint; Limited Step -Up Provisions and Reimbursement ..................................................................................................... 44 Article 22. Contracts to Be Uniform ........................................................................................... 46 Article 23 . Amendments .............................................................................................................. 46 Article 24. Opinions and Determinations; Good Faith; Information to Be Provided to Zone 3 Advisory Committee ........................................................................................... 48 Article 25. Waiver of Rights ......................................................................................................... 49 Article 26 . Notices ........................................................................................................................ 49 Article 27. Assignment; Pledge ................................................................................................... 50 Article 28. Inspection of Books and Records ............................................................................. 50 Article 29 . Severability ................................................................................................................. 51 Article 30 . Water Rights ............................................................................................................... 51 Article 31 . Wheeling of Water ..................................................................................................... 51 Article 32. Execution in Counterparts ........................................................................................ 52 Article 33 . Gove r ning Law ........................................................................................................... 53 Article 34. Re-funding Related Provisions .................................................................................. 53 EXECUTION ................................................................................................................................... 55 Exhibit A ........................................................................................................................................ 57 Page 40 of 512 AMENDED AND RESTATED CONTRACT BETWEEN SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTR I CT AND THE CITY OF ARROYO GRANDE FOR A WATER SUPPLY This Amended and Restated Contract (the "Contract"), made this12/~ay of Autj 0sf , 2022, by and between the San Luis Obispo County Flood Control and Water Conservation District (the "District"), established under and pursuant to Chapter 1294 of the 1945 Statutes of the State of California (the "State") and the City of Arroyo Grande, a public agency organized and existing under the laws of the State of California, acting pursuant to the laws of such State (the "Agency"), amends and restates that certain contract for a water supply by and between the District and the Agency, dated March 28, 1966, and as previously amended and restated and further amended thru the date hereof (collectively, the "Prior Supply Contract"), with reference to the follow i ng facts : WITNESSETH: WHEREAS, the District has heretofore constructed, improved and operated a public works project (the "Project," as more particularly defined below) that provides a supply of water available for use within the District; and WHEREAS, the District has made certain repairs and improvements to the Project for public safety reasons, which improvements (collectively, the "Seismic Remediation Improvements") were financed with the proceeds of certain obligations of the District; and WHEREAS, certain of those obligations were refinanced in 2011 and are proposed to be refinanced again to take advantage of conditions in the financial marketplace appropriate for Pa g e 1 of 58 Page 41 of 512 a cost-effective refunding for the benefit of the taxpayers and ratepayers of the District and the Agency; and WHEREAS, given that such obligations are outstanding, the parties have not removed or modified certain provisions of the Contract related to the Seismic Remediation Improvements even though some such provisions were performed, (e.g., the provisions related to the now-completed Seismic Remediation Improvements); and WHEREAS, the lands and inhabitants within the jurisdiction of the Agency are in need of water provided by the Project for beneficial uses, and the District has provided water from the Project to the Agency and to the City of Grover Beach, the City of Pismo Beach, the Oceano Community Services District, and the County of San Luis Obispo on behalf of Service Area No. 12 (collectively, the "Other Agencies ," as hereinafter defined) since 1966, pursuant to several water supply contracts, including the Prior Supply Contract as previously amended and restated and further amended thru the date hereof (collectively, the "Prior Supply Contracts"); and WHEREAS, the District and the Agency and Other Agencies now wish to amend and restate the Prior Supply Contracts to provide the Agency and Other Agencies with storage rights in the Lopez Reservoir and to make other amendments clarifying the manner in which Project Water is to be made available to the Agency and the Other Agencies while preserving the same basic structure and obligations under the Prior Supply Contracts, including with respect to downstream releases; and Page 2 of 58 Page 42 of 512 WHEREAS, following execution of the most recently amended and restated Prior Supply Contracts in or around August 2000, the District and the Agency and Other Agencies took certain actions as reflected in t he Interim Downstream Release Schedule (adopted by the Board of Supervisors via Resolution No . 2007 -164) and the Low Reservoir Response Plan (Board of Supervisors adopted certain policies and procedures therein for the then drought emergen cy via Resolution No . 2014-377) related to the manner in which the District will manage downstream release s on an interim basis; and WHEREAS, given the generality of Article 4(A) and the authority given to the District under Article 4(8) of the Prior Supply Contract (substantively unchanged in the Contract), such actions described in the preceding recital have not necessitated and do not currently necessitate an amendment to the Prior Supply Contract as part of the Contract, and it is anticipated that the same will be true of similar future actions, including adoption of the Habitat Conservation Plan which will replace the Interim Downstream Release Schedule subject to the minor clarifying amendment contained herein; and WHEREAS, the amendments set forth herein will also aid the District in meeting its intended communitywide r esults of enhancing the economic, environmental and soc ial quality of life in San Luis Obispo County; and WHEREAS , the Agency desires to cont i nue to contract with the District for a water supply to be for the use and benefit of the lands and inhabitants served by the Agency and for which the Agency will make payment to the District upon the terms and conditions hereinafter set forth; and Pag e 3 o f 58 Page 43 of 512 WHEREAS , the Dist r ict and the Agency wish to provide for the refinancing of certain obligations the proceeds of which were used to finance or refinance the completed Seismic Remediation Improvements. NOW, THEREFORE , IT IS HEREBY MUTUALLY AGREED by the parties hereto as follows: Article 1. Definitions. When used in the Contract, t he following te r ms shall have the meanings hereinafter set forth : "Additional Projects " shall mean those capital projects to be undertaken by the District in addition to the Seismi c Remediation Improvements which have the effect of (i) preserving and maintaining the Safe Yield of the Project (a "Type I Additional Project"); (ii) maintaining the quality of water provided by the Project (a "Type II Additional Project "); or (iii) any other capital project agreed to by the Agency and all of the Other Agencies (a "Type Ill Additional Project "). "Agency Initiated Exchange " shall mean an ex change initiated by a State Water Project Subcontractor to deliver State Wate r Project Water to the Project to replace Project Water requested for delivery by Other Agencies . "Calendar Quarter" shall mean each th r ee -month period commencing on January 1, April 1, July 1, and Octobe r 1 of each year. "Calendar Year" shall mean the twelve -month pe r iod from January 1 of a calendar year to Decembe r 31 of the same calendar year, both dates inclusive . "Capital Costs " shall mean costs expended by the District at or appurtenant to the Project, for permanent improvements to the Project or equipment which is capitalizable on the books of the Dis t rict. Page 4 of 58 Page 44 of 512 "Capital Reserves" shall mean those reserves established by the District for the Scheduled Maintenance of the Project or for anticipated costs of upgrade and improvements likely to be imposed by a Governmental Authority (each, an "External Requirement") in order for the District to continue to operate the Project for water supply purposes, established either (a) on a year-to-year basis by the District in its annual budgets, copies of which shall be provided to the Agency promptly following adoption, or (b) on a multi-year basis by the District through the development and promulgation to the Agency of a long-term capita l improvement plan of the District; provided, however, that no Type Ill Additional Projects shall be funded from Capital Reserves; and provided further, that the District shall not expend any portion of Capital Reserves for any External Requirement until and unless such External Requirement becomes a final order of such Governmental Authority, not subject to further appeal. "Con tinuous Spillway Flow'' shall mean when the entire perimeter of the spillway crest is wetted and at least 1 acre foot of water has spilled. "Contract Payments" shall mean those payments due from the Agency to the District hereunder, as more particularly set forth in Article 14 hereof. "County Board" shall mean the Board of Supervisors of the County of San Luis Obispo, California. "Coverage Account" shall mean the account established for the Agency either with the District or with a Depository, as provided in Article 18 he reof. "Coverage Factor" shall mean 25% of Agency Debt Service, determined in accordance with Article 14 hereof, calculated for each Fiscal Year. Page 5 of 58 Page 45 of 512 "Debt Service" shall mean, in the aggregate: (a) principal and interest (or mandatory sinking fund payments, installment or lease or similar payments due) with respect to all Tax-Exempt Obligations at the time outstanding in accordance with their terms, provided that capitalized interest funded from the proceeds of Tax-Exempt Obligations need not be taken into account; (b) annual costs of administering the Tax-Exempt Obligations, including the annual fees of any trustee or paying agent therefor, and; (c) the costs, if any, of annual credit enhancement for the Tax-Exempt Obligations; and (d) principal, interest, annual fees and reserve requirements under the SRF Loan. "Depository" shall mean a financial institution designated for the deposit and administration of the Coverage Account of the Agency, as and when appointed in accordance with Article 18 hereof. "District Initiated Exchange" shall mean an exchange initiated by the District to provide State Water Project Water to the Agency during a Lopez Water Treatment Plant (the "WTP") shutdown or other incident that prevents treatment and/or delivery of Lopez Water. "Entitlements" shall mean the quantity of water to be distributed to the Agency under the Contract and to the Other Agencies under contracts substantially similar to the Contract (collectively, the "Contracts'J with the District, as established in Article 4(B) hereof and of such other Contracts. "Fiscal Year" shall mean the twelve-month period from July 1 of the Calendar Year to June 30 of the immediately following Ca lendar Year, both dates inclusive. Page 6 of 58 Page 46 of 512 "Force Majeure" shall mean any cause or causes not reaso nably within the control of the party claiming relief or suspension and which, by the exercise of reasonable diligence, such party is unable to prevent or overcome, including acts of God; landslides, subsidence, lightning, earthquakes, fires, storms or storm warnings, crevasses, floods or washouts; strikes, lockouts or other industrial disturbances; acts of the public enemy, acts of terror, sabotage, wars, blockades, military action or epidemics; civil disturbances; explosions, breakage or accident to wells, machinery, equipment or lines of pipe; the necessity for testing or making repairs or alterations to wells, machinery, equipment or lines of pipe due to such an event; freezing of wells, equipment or line s of pipe; inability of any party hereto to obtain, after the exercise of reasonable diligence, necessary materials, supplies, rights of way or permits; or any action or restraint by any Governmental Authority (so long as the party claiming re lief ha s not applied for or assisted in the application for, and has opposed where and to t he extent reasonable, such action or restraint, and as long as such action or restraint is not the result of a failure by the claiming party to comply with applicable law). "General Obligation Bonds" shall mean those certain general obligation bonds of the District, issued pursuant to authorization received from the voters of the District at the election conducted on March 7, 2000, in an aggregate principal amount of not to exceed $13,200,000, supported by a levy of ad va!orem taxes throughout the District, including the 2011 G.O . Bonds and any general obligation bonds issued to refund the 2011 G.O. Bonds . "Governmental Authority" shall mean any State, federal or local governmental agency with the authority to regulate or control any aspect of the District or the Project or their operations. Page 7 of 58 Page 47 of 512 "Operating Segment" as to the Agency, shall mean the segment of the Project constructed for, and providing service directly to, the Agency, which , as of the date hereof, consists of Units A and B. "Operation and Ma intenance Costs " sha ll mean the reasonable and necessary current expenses of maintaining, repairing, and operating the Project, including District admin istrative expenses directly attributable to Project function, but excluding Capital Reserves and Debt Service, all computed in accordance with generally accepted accounting princ iples applicable to enterprise funds of government agencies. "Other Agency" shall mean any other water-distributing public agency of the State, which, having the lega l power to do so, executes a water supply contract with the District substantia ll y identical to the Contract, except for agency information, dates, Unit participations, Proportionate Share and Percentage Sha r e, other than for the purpose of purchasing Surplus Water, including, as of the date hereof, the City of Grover Beach, the City of Pismo Beach, the Oceana Community Services District, and the County of San Luis Obispo, on behalf of Service Area No. 12 . "Percentage Share" shall mean the Agency's aggregate attributed share, by percentage, of charges for Operation and Maintenance Costs and Capital Reserves for any given Water Year for each respective Unit, as compared to all the charges for Operation and Maintenance Costs and Capital Reserves attributab le to each such Unit levied against the Agency and a ll Other Agencies, and as specified for the Agency be low: Unit A 50.55 % Unit B 50 .55 % Pa ge 8 o f 58 Page 48 of 512 Unit C 0 .00 % Unit D 0.00 % Unit E 0 .00% Unit F 0 .00 % Unit G 0.00 % Unit H 0.00 % Unit I 0 .00% UnitJ 0 .00 % "Project" shall mean (A) the 1965 Zone 3 Project described in Resolution No . 377-65 and Ordinance No. 813 of the District, adopted August 17, 1965, consisting of the following works and improvements: (i) Lope z Dam and Reservoir; (ii) Lopez Dam -Arroyo Grande Conduit System; (ii i) Arroyo Grande -Avila Conduit System ; (iv) Arroyo Grande -Oceana Conduit System ; (v) water treatment plant; (vi) terminal reservoir; (vii) any new construction, reconst ruction or replacement of these works and improvements, including, without limitation, the previously constructed Seismic Remediation Improvements, and (viii) all land, easements, Rights -of-Way, pumping plants, pipes, valves, fittings, machinery and other property necessary for any of the foregoing. "Project Water" or "Lopez Water'' shall mean water made available from the Project. "Proportionate Sha re" shall mean the percent of the total Entitlements available to the Agency, as compared to the aggregate of all Entitlements given to the Agency and all Other Agencies hereunder and under all Contracts in any given Water Year, as set forth in Article 4(8) hereof. Page 9 of 58 Page 49 of 512 "Rates and Charges" shall mean the rates and charges imposed and collected by the Agency for the provision of water services by its Water Enterprise, and/or, if the Agency shall instead have levied special taxes as described in Article 14(C)(1 )(b) below, such special taxes. "Recreational Budget Transfers" shall mean the annual transfer o r de red by action of the County Boa r d from revenues earned from recreational uses of the Project, based on the percentage of recreational usage , initially established under the terms of County Board Resolution No. 2000 -133, adopted on April 4, 2000 . "Refunding Bonds" shall mean those certain bonds executed and delivered by or on behalf of the District, refunding any General Obligation Bonds and/or Tax -Exempt Obligations of the District (together, the "Prio r Obligations"), the proceeds of which are applied : (i) to refinance o r retire the Pr ior Obligations of the District and (ii) to pay any costs of issuance in connection therewith. "Safe Yield" shall mean the safe yield of the Project, calculated , and established from t i me to time in accordance with the provisions of Arti cle 4 hereof, being 8,730 acre -feet of water as of the date hereof. "Scheduled Maintenance" shall mean the maintenance tasks fo r the Project whi ch are required to be accomplished less frequently than annually, a portion of the cost of wh ich is set aside in each annual budget of the District in anticipation of such requirement. "Seismic Remediation Improvements" shall mean those certain improvements, mo r e particularly described on Exhibit A hereto, to the 1965 Zone 3 Project required by State mandate, and necessary in order for the Project to continue to operate as a supplier of water to the District, the Agency and the Other Agencies . Page 10 of 58 Page 50 of 512 "SRF Loan" shall mean the Funding Agreement (Contract No . SRF02CX138) between the State Department of Water Resources, acting on behalf of the State Department of Health Services, and the District, as heretofore amended and as it may be further amended from time to time. "State Water Project Water" shall mean water made available to the Agency or Other Agencies (each a "State Water Project Subcontractor") through a separate contract with the District for water from the California State Water Project (the "State Water Project"). "Stored Lopez Water" shall mean Entitlement or Surplus Water that the Agency or Other Agencies chooses not to take delivery of and put into storage at the end of the Water Year. "Stored State Water Project Water" shall mean water credited to the Agency or Other Agencies through initiation of an Agency Initiated Exchange. "Surplus Water" shall mean the water available from the Project following distributions of water described in Article 4, paragraphs (A), (B), and (C) hereof. "Tax-Exempt Obligations" shall mean those certain obligations executed and delivered by or on behal f of the District, representing and evidencing interests of the owners thereof in certain installment payments made by the District for the acquisition of the Project, whose proceeds were used to finance, refinance or reimburse the costs of Seismic Remediation Improvements, in an aggregate principal amount of not to exceed the net amount, following the application of proceeds of sale of the General Obligation Bonds, required to complete the Seismic Remediation Improvements pursuant to State mandate and the District 's competitive bid process for such improvements. The term Pag e 11 of 58 Page 51 of 512 ''Tax-Exempt Obligations" shall also include any refunding bonds issued in order to refund (i) such Tax-Exempt Obligations or (ii) such refunding Tax-Exempt Obligations. "Total Contract Payments" shall mean all of the payments due from the Agency and the Other Agencies pursuant to Article 14 hereof and the same Article of the other Contracts . "Total Project Costs" shall mean, for any given Water Year, the aggregate amount necessary to provide for (i) Operation and Maintenance Costs; (ii) Debt Service; and (iii) Capital Reserves, as calculated by the District in accordance with Article 14 hereof and noticed to the Agency and the Other Agencies. "2011 G.O . Bonds" shall mean San Luis Obispo County Flood Control and Water Conservation District, Zone 3 General Obligation Refunding Bonds, 2000 Election, 2011 Series A, originally issued in the aggregate principal amount of $10,760,000 . "Unit" shall mean those facilities which collectively make up the Project, delineated as follows: (A) "Unit A" shall consist of the Lopez Dam and Reservoir, including access roads, fish trapping facilities and outlet works, all expenses of executing and delivering the Tax-Exempt Obligations, all moneys necessary to fund interest with respect to the Tax-Exempt Obligations prior to receipt of the first payments under the Contract and the other Contracts, and all engineering and legal fees for the entire Project. (B) "Unit B" shall consist of the terminal reservoir, a pumping plant and bypass conduit, the water treatment plant and the Lopez Dam-Arroyo Grande Conduit System. The "Lopez Dam -Arroyo Grande Conduit System" shall be defined as that portion of the pipeline conduit and all appurtenances from the Lopez Dam outlet works to and including a bifurcation structure located at the intersection of the El Camino Real and Brisco Road in Arroyo Grande. (C) "Unit C" shall consist of that portion of the Arroyo Grande-Avila Conduit System consisting of the pipeline conduit and all appurtenances from the bifurcation structure which is a part of Unit B to the intersection of the El Camino Real and Oak Park Blvd . in Grover Beach. Page 12 of 58 Page 52 of 512 (D) "Unit D" shall consist of the Arroyo Grande-Oceana Conduit System. The "Arroyo Grande-Oceana Conduit System" shall be defined as that portion of the pipeline conduit and all appurtenances from the south end of the Lopez Dam-Arroyo Grande Conduit System to a connection to the Oceana water system at the intersection of Lancaster Drive and South Elm Street in Arroyo Grande. (E) "Unit E" shall consist of that portion of the Arroyo Grande -Avila Conduit System consisting of the pipeline conduit and all appurtenances from the wes t end of Unit C to the intersection of El Camino Real with Vista del Mar in Shell Beach. (F) "Unit F" shall consist of that portion of the Arroyo Grande -Avila Conduit System consisting of the pipeline conduit and all appurtenances from the west end of Unit E to the intersection of Shell Beach Road with El Portal Drive in Pismo Beach . (G) "Unit G" shall consist of that portion of the Arroyo Grande -Avila Conduit System consisting of the pipeline conduit and all appurtenances from the west end of Unit F to the intersection of Avila Beach Drive (San Luis Obispo County Road No . 2070) with Ontario Road (San Luis Obispo County Road No. 2066). (H) "Unit H" shall consist of that portion of the Arroyo Grande -Avila Conduit System consist i ng of the pipeline conduit and all appurtenances from the west end of Unit G to the intersection of First Street and San Juan Street in the community of Avila Beach . (I) "Unit I" shall consist of that portion of the Arroyo Grande -Avila Conduit System consisting of the pipeline conduit and all appurtenances from the wes t end of Unit H to the Port San Luis Harbor District Tank site. U) "Unit I" shall consist of that portion of the Arroyo Grande-Av ila Conduit System consisting of the pipeline conduit and all appurtenances from the west end of Unit G to a storage tank site at an approximate elevation of 260 feet above sea level located at a point approximately 1,300 feet westerly of the center line of Highway 101 and 1,500 feet southerly of San Luis Bay Drive (San Luis Obispo County Road No. 2068). ''Variable Charges" shall mean Project pumping energy and chemical charges. "Water Enterprise" shall mean the water system operated and to be operated by the Agency for sales of water to the general public within its jurisdiction . Page 13 of 58 Page 53 of 512 'Water Yea r" shall mean the twelve -mon t h period from April 1 of a Calendar Year to March 31 of the immediately following Calendar Year, both dates inclusive . "Zone 3" shall mean the area compris i ng Zone 3 of the District. "Zone 3 Advisory Committee" shall mean that certain advisory committee comprised of representatives of the District, the Agency and each of the Other Agencies, appointed by the District, the Agency and the Other Agencies , from time to time and meeting at scheduled intervals to advise the District on matters relating to the Project, the Contract and the other Contracts . Article 2. Term of Cont r act. The Contract shall become effective and shall replace and supersede the Prior Water Supply Contract as of the date that all of the following have occurred: (a) the District and the Agency have executed the Contract; (b) the District and each of the Other Agencies have executed a like amended and restated Contract and (c) the District has received the written confirmation from the r ating agency or agencies and the written consent from the bond i nsurance provider in accordance with Article 23 of the Prior Supply Contracts . The Contract shall remain in effect through the date which is six (6) months following the repayment of the final Debt Service payments of any debt obligation outstanding; provided, however, that the term of the Contract shall automatically be extended for additional periods of five (5) years from the scheduled expiration date hereof, so long as the Agency has not, by the date which is 180 days prior to the scheduled expiration date hereof, given written notice to the District to the effect that it wishes to terminate the Contract. The Agency understands and agrees that each of the Other Agencies has the right to terminate its Contract on similar terms and that, if any Other Agency shall so elect to terminate its Contract, the Entitlement and Page 14 of 58 Page 54 of 512 corresponding obligations of such Other Agency shall be apportioned among the Agency and the remaining Other Agencies, based upon a recalculation of Proportionate Share or Percentage Share, based, where appropriate, on their access to and use of Units, or as otherwise unanimously agreed by the Agency (unless the Agency shall have withdrawn), all remaining Other Agencies and the District. Article 3. Validation. Either the District, the Agency, or any Other Agency may file and diligently prosecute to a final decree in a court of competent jurisdiction a proceeding in mandamus or other appropriate proceeding or action for the judicial examination, approval, and confirmation of any proceedings had for the organization of the District and for the participation of the Agency in projects hereunder, or for the validation of the Installment Purchase Agreement which is the basis for the Tax -Exempt Obligations, or the proceedings of the governing body of the Agency leading up to and including the making of the Contract and the validity of the provisions thereof and hereof. Article 4. Distribution and Sale of Project Water. The following provisions govern the distribution of water from the Project to the Agency, to the Other Agencies and for other purposes, in the priorities set forth below: (A) Legally Required Water Releases. The parties hereto acknowledge and agree that Project Water is subject to certain releases and minimum storage requirements imposed by law which are not affected by the terms hereof. Without limiting the foregoing, the parties specifically acknowledge and agree that releases by the District pursuant to any Habitat Conservation Plan or related implementing agreement constitute release requirements imposed by law for purposes of the priorities established herein . Page 15 o f 58 Page 55 of 512 (B) Entitlements. Subject to the foregoing, and except as otherwise provided in Article 5, the District shall make available to the Agency in each Water Year, to the extent possible, 2,290 acre-feet of Project Water. The District will, in order to satisfy this entitlement and the entitlements of Other Agencies, set aside from the Safe Yield the total of 4,530 acre -feet of Project Water which w i ll be distri buted to the Agency and the Other Agencies , as established under Article 4(8) he r eof and of their respective Contracts. The Agency 's Entitlement comprises 50.55 percent of the aggregate Entitlements awarded under all the Contracts, including the Contract. Such percentage comprises the Agency's Proportionate Share hereunder. Notwithstanding the foregoing, the aggregate Entitlements available under the Contract and under the other Contracts may be reduced, following written notice given to the Agency from the District, due to (1) permanent or long-term restrictions imposed upon the District caused by (i) extreme changes in long-term meteorological patterns that reduce the Safe Yield assumptions for the Project or (ii) multi -year drought conditions; or (2) temporary or short-te r m limitations based upon (i) reduced ability of the Project either to treat or dist r ibute water because of a Force Majeure event, (ii) drought conditions or (iii) water quality standards which reduce the safe, treated output of the Project at the time . (C) Surplus Water Rates. Surp lus Water sha ll be the remaining portion of the annual Safe Yield of the Project after distribution of Entitlements described in paragraph (B), downstream releases , water described in paragraph (A), and including any unde livered Entitlement put into storage on behalf of the Agency and Othe r Agencies in that Water Year. Surplus Water shall be declared by the District on or about May 1st of Page 16 of 58 Page 56 of 512 each year after end of year water accounting has been completed. Surplus Water shall be sold in accordance with the provisions of this paragraph. (1) Su r plus Water shall fi r st be offered by the District to the Agency and the Other Agencies in accordance with their Proportionate Shares. The cost of Surplus Water shall be based on the Variable Charges as described in Article 14(D) below in any given Fiscal Year. The cost of Surplus Water shall be paid by the Agency in the same Fiscal Year as the Surplus Water is delivered to the Agency. Neither the Agency nor any Other Agency shall resell Surplus Water at any time to third parties, without the prior written consent of all Other Agencies. (2) The District may offer to sell and deliver any Surplus Water not requested by the Agency or the Other Agencies hereunder to any other prospective purchaser without right of renewal, in a manner and at prices which will return to the District the largest net revenue practicable, but in no event at prices less than those at which such Surplus Water is delivered to the Agency, unless the Agency is first allowed another opportunity to request such Surplus Water, and in each case, attempting to recapture the Operation and Maintenance Costs, the Variable Costs, if any, and Debt Service attributable to the volume of Surplus Water actually purchased by such third parties, at the highest price the market will then bear. (3) All revenues derived by the District from the sale of Surplus Water to any third party hereunder shall be applied as a credit to the obligations of Page 17 of 58 Page 57 of 512 the Agency and the Other Agencies , based on the Percentage Shares of the Agency and each Other Agency. (D) Surplus Water. Surplus Water shall be the remaining portion of the annual Safe Yield of the Project after distribution of Entitlements described in paragraph (B), downstream releases, water described in paragraph (A) and including any undelivered Entitlement put into storage on behalf of the Agency and Other Agencies in that Water Year. Surplus Water shall be calculated for each Wate r Year by subtracting from the Safe Yield of the Project an amount equal to the sum of the quantity of water released downstream during the immediately prior Water Year, which shall not exceed 4,200 acre feet unless legally required by Article 4(A) hereof, the quantity of Entitlement water delivered to the Agency and the Other Agencies during the immediately prior Water Year, and the quantity of undelivered Entitlement water that the Agency and Other Agencies put into storage in Lopez Reservoir, but excluding downstream releases and Entitlement deliveries that occurred during the pe r iod of time that the District determined that continuous spillway flow was occurring at Lopez Dam. As provided in Article 7(B) and 7((), Project Water that was put into storage in Lopez Reservoir prior to the District's determination that a continuous spillway flow was occurr ing at Lopez Dam may be subject to losses. The District shall notify the Agency of the total amount of Surplus Water available for the current Water Year, and once so declared by the District, said amount shall not be changed by the District without first obtaining the consent of the Agency and all Other Agencies. Page 18 of 58 Page 58 of 512 Surplus Water offered to the Agency will be delivered to Agency in the manner provided for the delivery of its Entitlement and to the extent that all of said Surplus Water offered to the Agency is not so delivered by the end of the Water Year in question or put into storage in Lopez Reservoir for the Agency, then such undelivered amount shall revert to the District and shall not thereafter be available to Agency. (E) Stored Water. The Agency may choose to take delivery of its previously stored water regardless of whether the current year's Entitlement or available Surplus Water has been delivered. Water put into storage by the Agency shall be subject to losses as outlined in Article 4 and Article 7. Article 5. Water Shortages. From time to time during the term of the Contract, there may occur a shortage in the quantity of Project Water available for delivery to the Agency by the District under the Contract, including, without limitation, for the reasons enumerated in Article 4(8). In such event, no liability shall accrue against the District or any of its officers, agents or employees for any damage, direct or indirect, arising from a shortage on account of any reason beyond the control of the District. In any Water Year during which such a shortage has caused a re d uction as described in said Article 4(8), so that the total quantity of the Entitlements available for the District to distribute is less than the total established in said Article 4(8), following giving of notice by the District as provided in Article 4(8), the Proportionate Share of the Agency and each Other Agency under its Contract shall be applied to such reduced amount in determining the volume of Project Water to be delivered to the Agency and such Other Agencies in such Water Year . Article 6. Completion of Seismic Remediation Improvements. The Agency understands and acknowledges that the District intends to commence and complete the Seismic Remediation Page 19 of 58 Page 59 of 512 Improvements with due diligence; in or de r to finance the construction of the Seismic Remediation Improvements, the Agency understands and agrees that the District will have to cause the execution and delivery of the Tax -Exempt Obligations on terms and conditions favorable to the District, the Agency and the Other Agencies, to be established at the time of sale of the Tax -Exempt Obligations . In particular, the Agency covenants and agrees that: (A) The District shall contract for the public works comprising the Seismic Remediation Improvements on such terms as the Dist r ict, in its sound business judgment, may deem in the best interests of the District, the Agency and the Other Agencies , but only following consideration by the Zone 3 Advisory Committee of any such contracts in excess of the minimum standards fo r contracts of a similar type then mandated for formal approval by the County Board (the "County Standards"); provided, however, that no such consideration shall be required as a precondition to any such action in response to an emergency; and (B) The Dist r ict may engage, but only (excep t in an emergency, in which case no such consideration shall be required as a p r econdition) following consideration by the Zone 3 Advisory Committee of any su ch contracts in excess of the County Standards, contractors and consultants, including, without limitation, environmental specialists, engineers, financial consultants, underwriters, attorneys and accountants (collectively, the "Consultants "), as may be necessary in order to plan and construct the Seismic Remediation Improvements and to issue and sell the Tax -Exempt Obligations, on such terms and conditions as the District shall determine; provided, however, that the District and the Agency hereby covenant and agree that all such contracts already in place as of the effective date of this Contract shall be deemed Page 20 of 58 Page 60 of 512 noticed to and considered by the Zone 3 Advisory Committee; and provided further, that no such consideration shall be required as a precondition to any such action in response to an emergency; and (C) The Dis t r ict may authorize and sell at either public or private sale, o r cause to be executed and delivered, the Tax -Exempt Obligations at any time following the effective date hereof, t o provide for the financing or reimbursement to the District of the costs of the Seismic Remediation Improvements, to establish a reserve fund for the Tax -Exempt Obligations and to pay the costs of delivery thereof; and (D) The Agency will execute and provide such instruments, certificates and agreements as may be necessary in order fo r the District to deliver the Tax -Exempt Obligations, including, w ithout limitation, information for inclusion in the disclosure document for the Tax -Exempt Obligations and a continuing disclosure agreement to permit compliance with Rule 15c2 -12 of the Securities and Exchange Commission, respecting the Agency 's financial condition and operations; and (E) The Agency will cooperate with the District and the Consultants in connection with the planning and construction of the Seismic Remediation Improvements and the authorization and delivery of the Tax -Exempt Obligations. The District covenants and agrees to use its best efforts to complete the Seismic Remediation Improvements by a date no later than June 30 , 2002. Article 7. Delivery and Storage of Water. All water to be furnished to the Agency pursuant to this Contract shall be furnished to the Agency as provided by Article 7(A) or put into or delivered from storage in Lopez Reservoir as prov ided in Article 7(8) and 7(C). Page 21 o f 58 Page 61 of 512 (A) Water furnished to the Agency shall be delivered to the Agency at the intersection of Highway 101, South Frontage Road , and Brisco Road in the City of Arroyo Grande. If the Agency shall desire at any time during the term of the Contract to change the address at which it rece ives water from the District hereunder, or to install additional points of delivery, it may do so if it furnishes all funds necessary to cover any District expenses involved, or if it undertakes the construction of the necessary conduits and appurtenances at its own expense; provided that the Agency shall not undertake any such construction until it has first obtained District approval of the plans and specifications for such work. Upon the receipt of a request for a change in or addition to the place of delivery of water thereunder, and the deposit of any required funds as set forth in this pa r agraph, the District shall, if it has elected to perform its own construction of conduits and appurtenances, diligently proceed to construct the same . (B) Storage of Lopez Water. The Agency may choose to put any water into storage in Lopez Reservoir that the Agency otherwise has the right to be furnished pursuant to Article 7(A), including Entitlements as provided by Article 4(B) and Su r plus Wate r as provided in Article 4{D). Stored Lopez Water in Lopez Reservoi r is subject to the followi ng: (1) The Agency must comply with the requirements of Article 9. (2) Water put into storage in Lopez Reservoir by the Agency is subject to the following losses: (a) Evaporation losses shall be calculated by the District and shall reduce the Agency 's water in storage in Lopez Reservoi r by calculating the amount of water lost from evapo ration due to the additional lake surface area associated with the water in storage annually on a monthly timestep. Page 22 of 58 Page 62 of 512 Evaporation losses are applied proportional to each Agency's amount of water in storage. (b) Water in storage in Lopez Reservoir shall be lost in the event the District determines that continuous spillway flow occurs at Lopez Dam that equals or exceeds the combined amount of water in storage in Lopez Reservoir on behalf of the Agency and Other Agencies. If the District determines that the spillway flow was le ss than the combined storage, then the water in storage in Lopez Reservoir lost by the Agency and Other Agencies shall be proportioned based on their respective amounts in storage in Lopez Reservoir and calculated such that the total water lost by the Agency and Othe r Agencies equals the District's determination of spillway flow. (c) Water in storage in Lopez Reservoir may be lost pursuant to Article 4(A) except that no water shall be lost from storage in Lopez Reservoir until afte r Entitlements made available to the Agency and Other Agencies pursuant to Article 4(B) equals zero and Surplus Water available to the Agency and Other Agencies pursuant to Article 4(D) equals zero. In such an event, the amount of water in storage in Lopez Reservoir that will be lost by the Agency and Other Agencies shall be proportioned based on Entitlements until each Agency's water in storage in Lopez Reservoir is reduced to zero or the required releases pursuant to Article 4(A) have been met, whichever occurs sooner. (d) Water in storage in Lopez Reservoir may be lost because of a Force Majeure event. The water in storage in Lopez Reservoir lost by the Page 23 of 58 Page 63 of 512 Agency and Other Agencies shall be proportioned based on their respective amounts in storage in Lopez Reservoi r. (3) Stored Lopez Water may be transferred amongst the Agency and Othe r Agencies subject to provision of pr ior written autho r ization to the District by each Agency involved in the transfer. (C) Storage of State Water Project Wa t er. The Agency and Other Agencies that have the right to "wheel" State Water Project Water pursuant to Article 31 (State Water Project Subcontractors) shall have the right to increase the Project Water that they put into storage in Lopez Reservoir subject to the terms and conditions set forth herein . State Water Project Water put into storage in Lope z Reservoir shall be accomplished by way of exchanging the delivery of Project Water that would otherwise be furnished by the District to Other Agencies pursuant to Articles 4(B) and 4(D) with State Water Project Water provided by the Agency. There ar e two types of exchanges, namely District Initiated Exchanges and Agency Initiated Exchanges. (1) District Initiated Exchanges -In consideration for the right to exchange Project Water with State Water Project Water, the Agency hereby grants to the District the right to exchange its State Water Project Water (if Agency is a State Water Project Subcontracto r ) w ith Project Water and deliver such exchanged water to Other Agencies during the "Curtailment of Delivery of Project Water for Maintenance Purposes" as provided in Article 13 . Any exchange undertaken pursuant to Article 7(C)(1) shall be construed as an Agency exchange of State Wate r Project Wate r with Other Agencies and shall not be construed as a District sale or delivery of State Water Project Water to Other Agencies . Prio r to initiating a Dist r ict Initiated Exchange hereunder Page 24 of 58 Page 64 of 512 during Article 13 curtailments, Other Agencies must first request the District to effectuate the exchange and must agree to pay the Variable Costs of delivering the State Water Project Water to the Lopez system. Such District Initiated Exchanges are limited to the availabi lity of State Water Project Water from the State Water Project Subcontractors and shall be proportioned between the State Water Project Subcontractors based on their available State Water Project Water. The quantities of water exchanged shall increase Project Water in storage for State Water Project Subcontractors and the District shall separately designate that water as "District Initiated Exchanged Water." Subsequent to any exchange hereunder, the District sha ll reverse the exchange as soon as possible with deliveries requested by State Water Project Subcontractors for State Water Project Water and the District shall reimburse the Other Agencies for the Variable Costs previously paid. The District Initiated Exchanged Water is not subject to evaporation losses . (2) Agency Initiated Exchanges . Water exchanged as a result of initiation by a State Water Project Water Subcontractor pursuant to this Article 7(C)(2) shall be separately designated by the District as Stored State Water Project Water and subject to the following additional terms: (a) Evaporation losses shall be calcu lated by the District pursuant to Article 7(B)(2)(a). (b) Stored State Water Project Water in Lopez Reservoir shall be lost in the event that the District determines that Continuous Spillway Flow occurs at Lopez Dam prior to the loss of any Project Water stored pursuant to Article 7(B). Water that has been put into Page 25 of 58 Page 65 of 512 storage in Lopez Reservoir by the District under its authority independent from the terms of the Contract shall be lost prior to losses of Agency Initiated Exchanged Water. In the event the District determines that the spillway flow reduces Stored State Water Project Water in storage in Lopez Reservoir, then the losses between State Water Project Subcontractors shall be proportioned based on their respective amounts of Stored State Water Project Water in Lopez Reservoir. (c) Stored State Water Project Water in Lopez Reservoir is not subject to losses pursuant to Article 4(A). (d) Stored State Water Project Water may be lost because of a Force Majeure event. (e) Stored State Water Project Water may be transferred amongst the Agency and Other Agencies subject to the provision of prior written authorization to the District by each Agency involved in the transfer. Article 8. Measurement. All water furnished pursuant to the Contract shall be measured by the District at each point of delivery established pursuant to Article 7 hereof with equipment satisfactory to the District and the Agency . Said equipment shall be installed, operated and maintained by the District. All determinations relative to the measuring of Project Wate r shall be made by the District and , upon request of the Agency, the accuracy of such measurement shall be investigated by the District and certified to the Agency in writing. Any e r ror appearing in the course of such investigation and certification shall be Page 26 of 58 Page 66 of 512 cause for an adjustment by the District. The Agency may inspect any such measuring equipment for the purpose of determining the accuracy the r eof, at its own expense at reasonable times upon reasonable notice. The District will install, or cause to be installed, backflow prevention devices in connection with such measuring equipment to prevent Project Water delivered to the Agency or to the Other Agen cies from returning to the District's lines . Article 9. Time for Delivery of Project Water . The amounts, times, and rates of delivery of Project Water to the Agency during any Water Year shall be in acco r dance with a water delivery schedule determined in the following manner: (A) On o r before October 1 of each Calendar Year, the Agency shall submit in writing to the District a preliminary water delivery schedule subject to the provisions of this Article and Article 4, indicating the amounts of Entitlement, and Agency Stored Lopez and Agency Stored State Water Project Water desired by the Agency during each month of the succeeding Water Year that is anticipated to be delivered to the address identified in Article 7. (B) Upon re ceipt of a preliminary schedule, the District shall review and after consultation with the Agency shall make such modifications as are necessary to ensure that the amounts, times and rates of delivery to the Agency will be consistent with the available supply of water from the Project, conside r ing the current delivery schedules of all Other Agencies . On or before January 1 of each Calendar Year, the District shall determine and furnish to the Agency a water delivery schedule for the next succeeding Water Year, which shall show the amounts of water to be del ivered to the Agency during each month of that Water Year . Page 27 o f 58 Page 67 of 512 (C) Changes to a water delivery schedule , requested transfers, or Agency Initiated Exchanges may be implemented by the District upon the Agency's written request, and subject to (i) the circumstances described in Article 4(B) hereof and (ii) the pre-existing requirements of the District under the water delivery schedules with the Other Agencies for the same period of time. Proposed amendments to such schedules shall be submitted by the Agency on the first day of the month and will become effective the first day of the following month and shall be subject to review and modification by the District in the same manner as the preliminary water schedule described in paragraph (B) above. (D) In no event shall the District be obligated to deliver Project Water to the Agency at a combined instantaneous rate of flow exceeding 3.30 cubic feet pe r second . However, if there is additional available capacity, the District shall make reasonable efforts to deliver the amount of water an Agency requests , taking into account Project capacity and Other Agency requests as well as pro rata shares of the Safe Yield . Article 10. Responsibility for Delivery and Distribution of Water Beyond Delivery Points. After Project Water has passed the delivery points established in accordance with Article 7 above, neither the District nor its officers, agents or employees shall be liable for the control, carriage , handling, use , disposal , distribution or changes occurring in the quality of such water supplied to the Agency or for a claim of damages of any nature whatsoever, including but not limited to property damage, pe r sonal injury or death, aris i ng out of or connected with the control, carriage, handling, use, disposal, distribution or changes occurring in the quality of such wate r beyond said delivery points, and the Agency shall defend, indemnify and hold harmless the District and its office r s, agents and employees Page 28 of 58 Page 68 of 512 from and against any such damages or claims of damage, except such damages or claims of damages caused by the sole proven negligence or willful misconduct of the District. Article 11. Operation and Maintenance of Project and Water Enterprise. The parties hereto acknowledge and agree that the primary goal of the District shall be to maximize deliveries of Project Water consistent with multi-year water resource planning, subject to Safe Yield and cost consi d erations, as to which the District shall be expected to exercise sound business judgment. (A) The District covenants and agrees that it will operate and maintain the Project as improved by t he Seismic Remediation Improvements in accordance with all governmental laws, ordinances, approvals, rules, regulations and requirements, including, without limitation, such zoning, sanitary, pollution, environmental and safety ordinances and laws and such rules and regulations thereunder as may be binding upon the District. The District further covenants and agrees that it will maintain and operate the Project and all pumps, machinery, conduits, apparatus, fixtures, fittings and equipment of any kind in or that shall be placed in any building or structure or made a part of any conduit or easement now or hereafter at any time constituting part of the Project in good repair, working order and condition, and that it will from time to time inspect and test all Project facilities against then-current water supply industry standards, and to pursue or recommend all necessary and proper replacements, repairs, renewals and improvements thereto. (B) In order to satisfy its covenants set forth in this Article, the District shall determine, prior to each Water Year, the amount of Capital Reserves necessary for the Project for the upcoming Water Year, shall prepare its draft annual budget by no later than March 1 to reflect such Capital Reserves , shall provide copies of each such budget to the Zone 3 Advisory Page 29 of 58 Page 69 of 512 Committee, the Agency and the Other Agencies for review and comment, prior to its distribution to and consideration by the County Board, and shall, if deemed necessary or advisable, develop and promulgate to the Agency and the Other Agencies a multi-year improvement plan for the Project, reflecting the annual requirements for Capital Reserves. (C) At any time, or from time to time, without the consent of the Agency or any Other Agency, the District shall be entitled to undertake the construction or equipping of any Additional Project or other improvements to or repairs of the Project not comprising a Type Ill Additional Project, but only if (i) it shall determine that such Additional Project, improvements or repairs are necessary in order to keep the Project functioning at the levels and to maintain the water supply at the quality required hereunder and under the other Contracts; or (ii) competent Governmental Authority shall direct such Additional Projects, improvements or repairs; provided that, before an Additional Project other than a Type Ill Additional Project, improvements or repairs may be ordered pursuant to direction of competent Governmental Authority, the District, the Agency and the Other Agencies shall be afforded notice thereof and the opportunity to oppose the imposition of such requirement before a court of competent jurisdiction; only if a final judgment is thereafter rendered, in favor of such Additional Project, improvements or repairs, or if no such opposition is filed, shall an Additional Project other than a Type Ill Additional Project, improvements or repairs be constructed or made pursuant to this clause (ii). Emergency repairs to the Project may, notwithstanding the above, be made by the District without the requirement of notice and opportunity to oppose described herein. It is the intention of the parties hereto that the District shall, as and when necessary, be deemed to assign its rights to pursue opposition to the creation of any obligations hereunder by a Governmental Authority to the Agency and/or the Other Agencies, as their interests may Page 30 of 58 Page 70 of 512 appear, in recognition of the status of the Agency and the Other Agencies as third-party beneficiaries hereof and re al parties in interest. No preexisting right of the Agency or the Other Agencies to pu r sue actio ns administratively, by law or i n equity associated with the construction, maintenance and operation of the Project shall be abrogated by the Agency o r such Other Agencies by its o r their execution of the Contract o r the other Contracts . (D) For its part, the Agency covenants and agrees : (1) not to sell , lease or otherwise dispo se of its Water Ente r prise or any part thereof essential to the proper operation thereof or to the earning or collection of the gross revenues of the Water Enterprise, nor to enter into any agreement or lease which wo u ld impair the operation of the Water Enterprise or any part thereof necessary in order to secure adequate revenues for the payment of amounts due unde r the Contract; provided , however, that any real or personal property which has become nonfun ct ional or obsolete o r which is not needed for the efficient operation of the Water En t erprise may be sold or disposed of if such disposition w i ll not have the effect of reducing revenues of the Water Enterpri se be low the levels required under the Contract; (2) to maintain and preserve the Water Enterprise in good repair and working order at all times, operate the same in an efficient and economi cal manner and pay all operation and maintenance costs of the Water Ente r prise as they become due; (3) not later than the first day of each Fiscal Year, to adopt and make available to the District a budget approved by its governing board setting forth the amounts budgeted to be paid under the Contract; Pag e 3 1 of 58 Page 71 of 512 (4) to comply with, keep, obseNe and perform all agreements, conditions, covenants and terms, express or implied, required to be performed by it contained in all contracts for the use of the Water Enterprise and all other contracts affecting or involving the Water Enterprise to the extent that the Agency is a party thereto; (5) not to create or allow any lien on or payment from the revenues of the Wate r Enterprise or any part thereof prior to or superior to its obligation to pay amounts payable under the Contract; (6) to procure and maintain such insurance relating to the Water Enterprise which it shall deem advisable or necessary to protect its interests, which insurance shall afford protection in such amounts and against such risks as are usually covered in connection with similar wate r enterprises in the State; provided, that the Agency shall not be required to procu re or maintain any such insurance unless such insurance is commercially available at reasonable cost; and provided further, that any such insu rance may be maintained unde r a self-insurance program, so long as such self-insurance program is maintained in accordance with standards and in such amounts as are then usually maintained for similar water enterprises in the State; (7) to pay and discharge all taxes, assessments and others governmental charges which may hereafter be lawfully imposed upon the Water Enterprise or any part thereof when the same shall become due ; duly obseNe and conform with all valid regulations and requi r ements of any governmental authority relative to the operation of the Water Enterprise, that are not being contested in good faith; and Page 32 of 58 Page 72 of 512 (8) if all or any material part of the Water Enterprise shall be taken by eminent domain proceedings, or if the Agency receives any insurance proceeds resulting from a casualty loss to any material portion of the Water Enterprise, t he proceeds thereof shall be used to construct or install replacements for the condemned or destroyed components of the Water Enterprise or to prepay the Agency's share of Debt Service under the Contract. Article 12. Water Quality. All water delivered to the Agency under the Contract shall meet all State and San Luis Obispo County minimum water quality standards for water for domestic use. Article 13 . Curtailment of Delivery of Project Water for Maintenance Purposes. The District may temporarily discontinue or reduce the amount of water to be furnis hed to the Agency for purposes of maintaining, repairing, replacing and investigating or inspecting, any of the facilities necessary for the furnishing of Project Water to the Agency hereunder. Insofa r as it is feasible, the District will give the Agency advance notice of any such temporary discontinuance or reduction, except in the case of emergency, in which case no advance notice need be given. In the event of such discontinuance or reduction, the District will apply its best efforts to minimize the duration and severity of service interruption hereunder and shall , as nearly as possible, make available to the Agency Project Water sufficient to make up for any shortfall in deliveries of water to the Agency during the period of curtailment. Article 14. Rate and Method of Payment. Commencing with the first Water Year during which Project Water is made available to the Agency hereunder, the Agency shall pay to the District in advance and on "a semiannual basis, its Contract Payments, calculated and paid in accordance Pa ge 33 of 58 Page 73 of 512 with the further provisions of this Article, for the Project Water made available under this Contract for such Water Yea r . (A) Allocation ofTotal Project Costs and Debt Service . On or before April 1 of each Calendar Year, the District shall calculate, o r cause to be calculated , Total Project Costs for the Fiscal Year commencing on the immed iately following July 1. The District shall deduct from the calculated Total Project Costs for such Fiscal Year: (1) the general ad valorem property taxes to be received by the District during the Fiscal Year in question; provided that any ad valorem taxes levied and paid to provide debt service on the District's General Obligation Bonds outstanding at any time shall be restricted to use for the payment of debt service on such Gene ral Obligation Bonds and shall not be included in the deducted amount represented by the foregoing clause; and (2) a sum equal to Recreational Use Revenues received by the District during the Fiscal Year about to be concluded . The result shall comprise the Total Contract Payments due, collectively, from the Agency hereunder and from the Other Agencies unde r their respective Water Supply Contracts. In determining the Debt Service portion of Total Project Costs during any Fiscal Year to be supported by the Agency, the District shall make the following calculations : • [(G.O . Debt Service)+ (Installment Debt Service)+ (SRF Loan Debt Service] - (District Revenues)= Allocable Debt Service ("ADS") • [(Proportionate Share) x ADS] = Annual Agency Obligations ("AAO") • AAO -(G.O. Ta x Collections)= Agency Debt Service For purposes of the above calculations, the te r m "G.O. Debt Service " above refers to the debt service on the District's General Obligation Bonds; the term "Installment Debt Service" refers to the installment payments due with respect to the Tax -Exempt Obligations; the term Page 34 of 58 Page 74 of 512 "SRF Loan Debt Service" refers to the payments due with respect to the SRF Loan; the term "Proportionate Share" refe rs to the Agency's Proportionate Share hereunder; the term "District Revenues" refers to t he amounts available to the District under the second sentence of this paragraph (A) of Article 14; and the term "G.O. Tax Collections " refers to amounts collected to support the General Obligation Bonds within the boundaries of the Agency during the Fiscal Year in question, based upon then-current levies; provided, however, that in the case of County Service Area No . 12, such boundaries shall be deemed to include that area comprising Avila Beach Community Services . District, as well as the area comprising such County Service Area No . 12. In no event shall Agency Debt Service, as calculated above, be a figure less than zero . The foregoing calculations shall be performed by the District each Fiscal Year and shall be made available to the Agency with respect to each Other Agency, as well. No more frequently than annually, the District shall retain a ce rtified public accountant, or fi r m thereof, with the approval of the Zone 3 Advisory Board, which shall be responsible for reviewing and confirming the Agency Debt Service figu r es resulting from the foregoing calculations, and reporting the same to the Agency, the District and each Other Agency. (B) Agency Contract Payments. Unless the Agency shall, in accordance with paragraph (C) below, be entitled to an offsetting credit, the Agency shall be obligated to pay to the District: (1) on or before July 1 and the immediately following January 1 of each Fiscal Year, a sum equal to one -ha lf of its Percentage Share of charges for Operation and Maintenance Costs and Capital Reserves for such Fiscal Year; Page 35 o f 58 Page 75 of 512 (2) on or before July 1 of each Fiscal Year, a sum equal to Agency Debt Service, as calculated under paragraph (A) above; and (3) on or before July 1 and the immediately following Janua ry 1 of each Fiscal Year, the Variable Charge calculated in accordance with paragraph (D) below. (C) Agency Credits against Contract Payments . The following shall constitute credits against the obligations of the Agency to pay Contract Payments to the District: (1) (a) If, prior to the date upon which the District causes the Tax-Exempt Obligations to be sold , the Agency shall contribute, in cash , a sum for its Proportionate Share of the total amount of costs and expenses projected by the District as the basis for the Seismic Remediation Project, or any portion of its Proportionate Share , so that the aggregate principal component of the Tax -Exempt Obligations is reduced by such sum, the Agency's Proportionate Share of Debt Service , and the r efore, of Total Project Costs, shall be reduced accordingly; and (b) If the Agency shall, following the date of delivery of the Tax-Exempt Obligations, successfully implement a financing plan within its jurisdiction to fund all or a portion of Debt Service during the term of the Tax-Exempt Obligations through the levy of ad valorem property taxes, special assessments or special taxes, then the Agency shall be entitled to a credit from amounts paid under such levy as though such amounts were paid directly by the Agency hereunder, subject to the prior approval of each rating agency then rating the Tax -Exempt Obligations and any bond insurer then providing insurance Page 36 of 58 Page 76 of 512 therefor; provided, however, that the District shall be made a third-party beneficiary of any pledge of such alternate source of r evenues, with the power to enforce collection thereof, in the event the Agency should fail to do so; and (c) The Agency shall be entitled to a cred it equal to a Percentage Share of the net revenues the District shall have received from the sale of Su r plus Water and from the delivery of any water wheeled for Wheeling Customers, as d efined in and pursuant to the provisions of Article 31, during the Fiscal Year in qu estion ; in determining the amount of such wheeling credits against the obligations of the Agency hereunder, the District shall apportion its net r evenues from the foregoing sources, taking into account the particular Unit or Units through which delivery of Surplus Water or wheeled water was made, and shall compare the Agency's Perce ntage Share for such Unit or Units wit h the aggregate Percentage Share for all Other Agencies and the Agency for such Unit or Units. (2) On or before December 1 of each year, the District shall deliver to the Agency a statement as to the actual Operation and Ma intenance Costs, Variable Charges, and Capital Reserve charges incurred or imposed during the Fiscal Year most recently conclu d ed, and shall set forth in such statement its determination as to whether the amounts theretofore paid by the Agency as its Percentage Share of estimated charges for Operation and Maintenance Costs, Variable Charges, and for Capital Reserves were in excess of or less than its Percentage Share of such costs and charges for the Fiscal Year most recently concluded . If the Agency shall have paid less than its Percentage Share of actual Operation and Maintenance Costs, Variable Charges, and charges for Capital Reserves for such Fiscal Year, the Agency Page 37 of 58 Page 77 of 512 shall remit the difference to the District within (180) days of the date upon which it receives such a statement; if the Agency shall have paid more than its Percentage Share of such costs and charges for such Fiscal Year, the District shall rebate the difference to the Agency promptly following its delivery of the closing statement, and, in any event, within thirty (30) days thereafter. (D) Variable Charges. The sum of Variable Charges to the Agency and the Other Agencies shall be an amount which is estimated to be sufficient to compensate the District for actual Project pumping ene rgy and chemical charges incurred . The Variable Charge shall be determined for each Fiscal Year during which Project Water is made available to the Agency under the Contract by (1) dividing the District's actual cost of pumping energy and chemical charges during that Fiscal Year by the total acre -feet of Project Water delivered by the District during such Fiscal Year to the Agency and all Other Agencies pursuant to the Contract and the other Contracts, and (2) multiplying this acre-foot charge by the number of acre -feet of Project Water delivered by the District to the Agency during such Fiscal Yea r . (E) Use by District of Total Contract Payments. During the term of the Contract and of the other Contracts, the District shall proceed with due diligence to collect Total Contract Payments as and when due, and shall apply amounts collected in the following order of priority: (1) to the payment of Operation and Ma i ntenance Costs; (2) to the payment of Debt Se r vice with respect to the Tax-Exempt Obligations; (3) to the payment of Debt Service with respect to the SRF Loan; and Page 38 of 58 Page 78 of 512 (4) to the replenishment or funding of Capital Reserves for the Project, in accordance with the provisions set forth in Article 10 hereof. Article 15 . Take-or-Pay Obligation of Agency. Commencing on the first date upon which Project Water is provided under the Contract, the Agency shall pay all amounts due hereunder, including, without limitation, under Article 14 hereof, without reduction or offset of any kind, whether or not the Project or any part thereof is then operating or operable or its service is suspended, interfered with, reduced or curtailed or terminated in whole or in part, due to any of the reasons outlined in Articles 4(B), 5 and 13 or otherwise, and such Agency payments shall not be conditional upon the performance or nonperformance by any party for any cause whatsoever, including the Other Agencies; provided, however, that savings from nonoperation of the Project shall be apportioned among the Agency and the Other Agencies in accordance with their Percentage Shares. The Agency's failure or refusal to accept delivery of Project Water, or to put water into storage, to which it is entitled under the Contract shall in no way rel ieve the Agency of its obligation to make payments to the District as provided for herein . Article 16. Pledge: Establishment and Collection of Rates and Charges . The Agency, unless it shall have paid cash as its share of the Total Project Costs, as provided in Article 14(C)(1) hereof, hereby pledges gross water sale revenues of its Water Enterprise to its obligations under the Contract, and covenants and agrees to establish, fix and collect Rates and Charges from the customers of its Water Enterprise at levels sufficient to produce revenues from the Water Enterprise at least equal to (A) the costs of operating and maintaining the Water Enterprise, plus (B) the Agency's Contract Payments, calculated in accordance with Article 14(B) hereof, including (C) the Agency's Proportionate Share of Debt Service , plus (D) the Coverage Factor for Page 39 o f 58 Page 79 of 512 the Debt Service portion of the Agency's Contract Payments; provided, however, that the provisions of Article 21 (C) hereof may impose upon the Agency a surcharge following the occurrence of any payment default by the Agency. The Agency acknowledges and agrees that its obligations hereunder shall comprise, for accounting purposes, an operation and maintenance expense of its Water Enterprise . Article 17 . Default. (A) The following shall constitute events of default hereunder: (1) The Agency shall fail to make timely payment in full of all amounts due from the Agency under the terms of the Contract; or (2) The Agency shall fail to establish or collect, or cause to be collected, all fees, charges and other sums necessary to enable it to make the payments required hereunder, as provided in Article 16 hereof, and following thirty (30) days ' written notice from the District to the Agency, shall fail to remedy such failure to the satisfaction of the District; or (3) The Agency shall fail to perform any other obligation or covenant hereunder and shall fail to remedy such failure to the satisfaction of the District within thirty (30) days following the Agency's receipt of written notice from the District, or for such additional time as is reasonably required, in the sole discretion of the District, to correct the same; or (4) The Agency shall file any petition or institute any proceedings under any act or acts, State or federal, dealing with or relating to the subject of bankruptcy or insolvency or under any amendment to such act or acts, either as a bankrupt or as an insolvent or as a debtor or in any si milar capacity, wherein or Pag e 40 o f 58 Page 80 of 512 whereby the Agency seeks or prays to be adjudicated bankrupt or is to be discharged from any or all of its debts or obligations, or offers a reorganization of its obligations for the benefit of creditors, or asks for similar relief. (B) Upon the occurrence of an event of default hereunder, the District shall be entitled to proceed to protect and enforce the rights vested in the District by the Contract by appropriate judicial proceedings as the District may deem most effective, either in equity or law. Without limiting the generality of the foregoing, the District shall be entitled to pursue any of the following remedies: (1) The District may suspend the delivery of water hereunder during the period when the Agency is delinquent in its payment for or other obligations to the District hereunder, but only following notice to the Agency and the imposition of such remedy following a formal hearing conducted by the County Board; (2) The District may compel the Agency, or its governing board, by action or suit in equity to account to the District as the trustee of an express trust; (3) The District may pursue by action or suit in equity to enjoin any acts or things which may be unlawful or in violation of the rights of the District hereunder; and (4) The District may proceed in mandamus or other suit, action or proceeding at law or in equity to enforce its rights against the Agency (and its board, officers, agents and employees) and to compel the Agency to perform and carry out its duties and obligations under the law and its covenants and obligations as set forth herein. Page 41 of 58 Page 81 of 512 The use by either party to the Contra ct of any r emedy specified herein for the enforcement of the Contract is not exclusive and shall not deprive the party using such remedy of, o r limit the application of, any other remedy provide hereunder o r by law or equity. (C) Upon each charge to be paid by the Agency to the District pursuant to the Contract which remains unpaid after the same shall have become due and payable, interest shall accrue at an annual rate equal to that earned by the County Treasurer's investment fund as provided in Government Code Section 16480 et seq. calculated monthly on the amount of such delinquent payment from and after the due date when the same becomes due until paid , and the Agency hereby agrees to pay such interest; provided, that no interest shall be charged to or be paid by the Agency unless such delinquency continues for more than thirty (30) days. The Agency hereby agrees to pay such interest to the District, whether or not the District shall pursue any of the remedies specified in this Article . In no event shall default interest be compounded. Article 18. Failure to Levy. Set or Collect Taxes. Rates and Charges: Establishment of Coverage Account. If the Agency for any reason shall fail or refuse to establish or levy taxes or Rates and Charges sufficient to satisfy the requirements of Article 16 hereof, or if the Agency shall be precluded from establishing rates and charges at the levels r equired in said Article 16, then the Agency shall promptly notify the District of such fact, in writing, and shall establish either (a) with the District; or (b) with a Depository designated by the Agency to the District in writing; a Cove rage Account, into which the Agency shall deposit, from the first lawfully available funds therefor, an amount equal to one year 's Coverage Factor for the Debt Service portion of the Agency 's Contract Payments hereunde r. The Coverage Account shall be invested Pag e 42 of 58 Page 82 of 512 in accordance with applicable provisions of the Government Code, su bject to any limitations established pursuant to Section 148 of the Interna l Revenue Code of 1986, as amended, applicable to surplus moneys of the Agency and shall be and remain available to the Agency and to the District as a source of funds to remedy any shortfall in the payment of Agency Contract Payments hereunder. The Coverage Account shall be pledged to the District for the purposes descr ibed herein, and the Agency covenants and agrees to execute such instruments as may be necessary in order to effect a pledge of amounts on deposit in the Coverage Account, acknowledging and agreeing as well to follow the advice of special tax counsel to the District in connection with the pledge and investment of the Coverage Account, as may be necessary or advisable in order to maintain the tax status of the Ta x-Exempt Obligations. If at any time following the establishment of the Coverage Account hereunder, the Agency shall again be able to and shall collect rates and charges as required under Article 16 hereof, the Coverage Account may be r eleased to the credit and name of the Agency for any lawful purpose thereof, upon delivery to the District of evidence satisfactory to the District that (i) the Agency has successfully levied rates and charges for its Water Enterprise at the appropriate levels for at least one full Fiscal or Water Year since the Coverage Account was first created, and (ii) the Agency is then current on all payments due under the Contract; whereupon, the District shall either release the Coverage Account to the Agency or shall direct the Depository to do so, free from the lien described herein. Article 19 . Area Served by Agency. Water delivered to the Agency pursuant to the Contract shall not be sold or otherwise disposed of by the Agency for use outside the boundaries of Zone 3 as they may now or hereafter exist, without the prior written consent of the District. Page 43 of 58 Page 83 of 512 Article 20. Changes in Organization of Agency. The Agency will furnish the District with maps showing the territorial limits of the Agency and the service area or areas of its water distribution system . Throughout the term of the Contract, the Agency will promptly notify the District of any changes, either by inclusion or exclusion, in said territorial limits and service area or areas. The Agency shall take no action to exclude any lands from the Agency or its service area or areas without the prior written consent of the District. Article 21 . Agency's Obligations Several and Not !oint: Limited Step-up Provisions and Reimbursement. (A) Except as provided in paragraph (B) of this Article, the Agency and the Other Agencies shall be solely responsible and liable for performance under the Contract or under the other Contracts, as applicable . Their obligations to the District to make payments under the Contract and the other Contracts are expressly recognized by the District as several, and not joint, and no default on the part of one of the Other Agencies shall, in and of itself, create an event of default hereunder. The Coverage Account of the Agency, if any is established hereunder, shall not be available for any shortfall in payments under any of the other Contracts, unless otherwise directed or approved in writing by the Agency. (B) In the event that the Agency or any Other Agency (each, a "Delinquent Agency") shall fail to pay its Contract Payments hereunder or under the Other Agency's Contract, as appropriate, for any reason, then the Contract Payments for each non-delinquent agency (each, a "Non -Delinquent Agency") then participating in the Project shall be increased for the particular Water Year by an amount equal to the sum of Contract Payments not paid in full by Delinquent Agencies (collectively, the "Shortfall"); provided, however, that Non-Delinquent Agencies shall contribute to the Shortfall in a Page 44 of 58 Page 84 of 512 proportion determined by dividing the Debt Service portion of the Contract Payments attributable to each particular Non-Defaulting Agency by the aggregate Debt Service portions of the Contract Payments attributable to all Non-Defaulting Agencies; and provided further, that the Agency in no event shall be required under this paragraph to cont r ibute to the Shortfall by an amount in any Water Year exceeding the amount which is 20% of the portion of the Agency's Contract Payments representing Debt Service for that Water Year . (C) If payments are made by Non -Delinquent Agencies under the foregoing paragraph (B) during any Water Year, the District shall, beginning on the first date upon which payments are due from a Delinquent Agency and not paid in accordance with its Contract (each , a "Due Date"), declare a default as to such Delinquent Agency under its Contract and shall be entitled to curtail all deliveries of Project Water under such Contract and Delinquent Agency shall not be allowed to put water into storage in Lopez Reservoir but may keep any water already in storage; notwithstanding the foregoing, such Delinquent Agency shall nonetheless continue to be obligated under its Contract for amounts paid on its behalf by the Non-Delinquent Agencies, until it has reimbursed each Non-Delinquent Agency in full. Amounts advanced by the Non-Delinquent Agencies hereunder are immediately due and payable by the responsible Delinquent Agency, and, if not so paid, and notwithstanding the provisions of Article 17(C), incur interest on the unpaid portion until paid in full at a rate per annum equal to the average rate for the County Treasury Pool , plus two percent (2.0%) per annum, for the month for which the County Treasury Pool rate was most recently calculated, based on a 360 -day year of twelve 30-day months; provided, however, that payments to be made as reimbursements under this paragraph (C) ar e deemed and understood to be subordinate to the obligations of the Delinquent Agencies to pay their Proportionate Shares of Debt Service . Pag e 45 of 58 Page 85 of 512 (D) Shortfalls in Total Contract Payments shall be remedied under this Article prior to the District's making any withdrawal from the debt service reserve fund established, or under the reserve surety bond posted, for the Ta x-Exempt Obligations, if any, drawings on or under which shall be delayed until and unless insufficient moneys are available from Non-Defaulting Agencies hereunder. (E) The District covenants and ag r ees to enforce the provisions of the Contract with due diligence, including, without limitation, the provisions of this Section for the benefit of the owners, from time to time, of the Tax -Exempt Obligations. Article 22. Contracts to Be Uniform. The Contracts executed by the District with the Other Agencies shall be substantially uniform with respect to basic terms and conditions, when compared with the Contract, but shall provide for different dates, quantities of water to be delivered , water delivery points, Proportionate Shares and Percentage Shares and payment amounts. Article 23. Amendments . The Cont ract shall be subject to amendment at any time by mutual agreement of the parties hereto, except insofar as any proposed amendments ar e in any way contrary to applicable law or would have a material adverse effect upon the owners of any of the Tax -Exempt Obligations. As a condition to any amendment to the Contract or to the other Contracts, the District shall first have received written confirmation from the rating agency or agencies then providing a rating for the Tax -Exempt Obligations, to the effect that the proposed amendments will not adversely affect the rating of the Tax-Exempt Obligations and, in the event that the Tax -Exempt Obligations, or any portion thereof, shall be covered by municipal bond insurance, the District shall have received prior written consent to such Page 46 of 58 Page 86 of 512 proposed amendments from the provider of such bond insurance . Amendments may be effected upon the following conditions: (A) Amendments to the Contract or the other Contracts which have the effect of replacing the Agency's or an y Other Agency's Proportionate Share of Project Water o r Percentage Share of Total Contract Payments w ith water purchases by or revenues contributed from either (i) the Agency or some Other Agency or (ii) a new customer, shall be subject to the approval only of those entities whose Proportionate Shares or Percentage Shares will be affected, and the District. (B) Upon the written request of the Agency or any Other Agency, the District may order the construction or equipping of any Type Ill Additional Project; provided, however, that the requesting Agency or Othe r Agency shall first demonstrate to the satisfaction of the District that either (i) the proposed Type Ill Additional Project will be economically feasible with the financial support of only the requesting Agency and/or Othe r Agencies who voluntarily participate (whose Percentage Shares will the r eafter be appropriately adjusted); or (ii) the Agency and all of the Other Agencies will consent to the funding of the Type Ill Additional Project and will agree to increase Total Project Costs sufficiently to provide for the costs thereof. The financing of a Type Ill Additional Project may be accomplished through the levy of additional Capital Reserv es, the issuance of additional bonds or other evidence of indebtedness or otherwise . The undertaking ofType I or Type 11 Additional Projects shall not require the consent of t h e Agency or any Othe r Agency nor the amendment of the Contract. Pag e 47 o f 58 Page 87 of 512 (C) Amendments to the Contract and to the othe r Contracts othe r than those specified above shall be approved only upon the prior written and unan i mous consent of the District, the Agency and all Other Agencies . Article 24. Opinions and Determinations: Good Faith : Information to Be Provided to Zone 3 Advisory Committee . (A) Where the term s of the Contract provide for action to be based upon opinion, judgment, approval, review o r determination of either party hereto, such terms are not intended to and shall never be construed to permit such opinion, judgment, approval, review of determination to be arbitrary, capricious or unreasonable . The District and the Agency shall each act in good faith in performing thei r respective obligations as set forth in the Contract. (B) The Zone 3 Advisory Committee, created by appointment of designated r epresentatives made by the Agency, each Other Agency and the District, is hereby continued for the purpose of advising the District regarding administrative and operational concerns affecting the Project. The District covenants and agrees to present to the Zone 3 Advisory Committee, at its regularly scheduled or specially called meetings, the following items for advice and comment, in each case , prior to final presentation of the same item to the County Board : i. the annual budgets for the Dist r ict; ii. the approval of each non-emergency Capital Project which has not theretofore been included in an annual budget of the District; it being understood and ag r eed that emergency repairs and improvements shall be exempt from any requirement fo r preview established hereby; and Pa ge 48 of 58 Page 88 of 512 iii. the mid -year review of actual fiscal performance of the Project, provided for the then-cu r rent Fiscal Year, and in any event, prior to March 31 of each calendar year, which may, to the extent practicable, be combined with the review of the District's annual budget for the next Fiscal Year . iv. any future Habitat Conservation Plan or implementing agreement for Arroyo Grande Creek that would affect operation of the Project. v. amendments to the methodology or formula established in County Board Resolution No. 2000 -133, adopted April 4, 2000, with respect to the making of Recreational Budget Transfers. Article 25. Waiver of Rights . Any waiver at any time by either party hereto of its rights with respect to a breach or default, or any other matter arising in connection with the Contract, shall not be deemed to be a waiver with respect to any other breach, default or matter hereunder, nor as to a breach or default occurring or having occurred unde r any other Contract. Article 26. Notices. All notices that are required either expressly or by implication to be given by either party to the other under the Contract shall, if given in writing, be executed on behalf of the District or for the Agency by such authorized officers as they may each, from time to time, authorize in writing for such purposes. All notices shall be deemed to have been given and delivered if delivered personally or if deposited, postage prepaid, with the Un ited States Postal Service for delivery. Unless and until formally notified otherwise, all notices shall be addressed to the parties at their addresses shown on the signature page of the Contract; provided, however, that either party may give written notice t o the other of a change in such notice address. Page 49 of 58 Page 89 of 512 Article 27. Assignment: Pledge . The provisions of the Contract shall apply to and bind the successors and assigns of the respective parties, including any assignee hereof designated in connection with the execution and delivery of the Tax-Exempt Obligations, but no assignment or transfer of the Contract by the Agency, or any part hereof or interest herein, shall be valid until and unless approved by the District; provided, however, that no further assignment by the District shall be valid until and unless approved by the Agency and all of the Other Agencies; and provided further, that, so long as any Tax-Exempt Obligations are outstanding, no such assignment shall be effective until such time as the District has received assurances from each rating agency then rating the Tax-Exempt Obligations, to the effect that such transfer shall not adversely affect the rating on the Tax-Exempt Obligations, and, so long as any Tax-Exempt Obligations are then being insured by a municipal bond insurance company, until such time as the District has received the written consent from such bond insurer as to such assignment. The Agency understands and acknowledges that the District intends to pledge amounts received and to be received hereunder and under the other Contracts to a financial institution and/or nonprofit corporation as further support for its obligations under the Tax-Exempt Obligations. Article 28. Inspection of Books and Records. The authorized officers of the Agency shall have full and free access at all reasonable times to the account books and official records of the District insofar as the same pertain to the matters and services provided for in the Contract, with the right at any time during regular office hours of the District to make copies thereof at the Agency's expense, and the authorized officers of the District shall have similar rights with respect to the account books and records of the Agency for its Water Enterprise. Page 50 of 58 Page 90 of 512 Article 29 . Severability. Any provision of the Contract that is prohibited, unenforceable or not authorized in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition, unenforceability, or non-authorization without invalidating the remaining provisions hereof or affecting the validity, enforceability of legality of such provision in any other jurisdiction. Article 30. Water Rights. No provision of the Contract shall be considered to be in derogation of any existing waiver of right(s) or claim(s) to water right(s) by or any agreements concerning water rights of either party hereof, including but not limited to overlying, prescriptive, appropriative, riparian, or pueblo rights, nor shall it be construed to result in any relinquishment or adjustment of any such water rights or claims thereof; and, in particular, no provision of this Contract shall be considered to diminish, reduce or affect, in any way, either party's rights pursuant to California Water Code Section 1005.1 and/or Section 1005.2. Article 31. Wheeling of Water. As used in this Article, the term "Existing Contractor" shall refer to the Agency and any Other Agencies presently having a contract with the District for the delivery of Project Water; any person other than an Existing Contractor which shall arrange for the delivery of water other than Project Water from the District under the terms hereof shall be described as a "Wheeling Customer." The Agency, as an Existing Contractor, shall be entitled to have additional water wheeled to it by the District through the various Units of the Project, at the actual cost of such wheeling, determined in accordance with the terms and conditions of the existing contracts by and between the District and the Agency or Other Agencies for the delivery of State Water Project Water to the Agency or Other Agencies through the Project. If at any time during the term of the Contract, the District delivers water, other than Project Water, through any Unit of the Project to any Wheeling Customer, said Wheeling Page 51 of 58 Page 91 of 512 Customer shall be required to pay for such delivery service in a manner and at prices which will return to the District the largest net revenue practicable, but in no event shall such deliveries be effected at charges less than those applicable to the delivery of Project Water to the Agency through the same Unit or Units. In determining the appropriate charges for water delivered to a Wheeling Customer hereunder, the District shall take into account the particular Unit or Units through which delivery of such water is made, shall compare the Operation and Maintenance Costs and Debt Service costs apportionable to such Unit or Units with Total Project Costs, and shall further compare the amount of water delivered to Wheeling Customers through such Unit or Units with the amount of Project Water delivered to Existing Contractors through such Unit or Units for the same period of time . In calculating credits to the Existing Contractors from the delivery of water to Wheeling Customers under the Contract and the other Water Supply Contracts, the District shall apportion such credits accord i ng to the Unit or Units through which such water was in fact delivered, as described in the preceding paragraph . The provisions of this Article shall be subject to any contracts which the District may execute with the United States of America for any grants from the Department of Housing and Urban Development. Article 32. Execution in Counterparts. The Contract may be executed in several counterparts, each of which shall be regarded as an original and all of which shall constitute but one and the same document. Page 52 of 58 Page 92 of 512 Article 33. Governing Law. The Contract shall be interpreted, governed, and enforced in accordance with the laws of the State of California applicable to contracts made and performed in such State. Article 34 . Re-Funding Related Provisions. The Agency concurs with the recommendation of the District to effect a refunding of the Tax-Exempt Obligations and the General Obligation Bonds issued in connection with the SLO County Financing Authority Lopez Dam Improvement Revenue Bonds, 2000 Series A and agrees to take all appropriate action in support of the issuance of the Refunding Bonds, as recommended by the District, its Bond Counsel, being Fulbright &Jaworski L.L.P., and its Financial Advisor, being Public Financial Management. In particular, the Agency understands and agrees that it will have incurred additional continuing disclosure obligations with respect to the Refunding Bonds, as more particularly described in the Continuing Disclosure Agreement to be executed in connection with the Refunding Bonds, pursuant to Rule 1 Sc2-12 of the Securities and Exchange Commission. The Agency concurs with the recommendation of the District to effect a refunding of the Tax-Exempt Obligations and the General Obligation Bonds issued in connection with the SLO County Financing Authority Lopez Dam Improvement Refunding Revenue Bonds, 2011 Series A (the "2011 Series A Bonds") and agrees to take all appropriate action in support of the issuance of Refunding Bonds, as recommended by the District, its Bond Counsel, being Norton Rose Fulbright US LLP, and its Financial Advisor, being KNN Public Finance, LLC, provided, however, the Refunding Bonds shall result in a minimum 3% present value total debt service savings reduction and lower annual debt service payments in every year (inclusive of any costs associated with the refinancing and the term of the Refunding Bonds shall not extend beyond the term of Page 53 of 58 Page 93 of 512 the 2011 Series A Bonds of August 1, 2030 . In particular, the Agency understands and agrees that it will have incurred additional disclosure obligations with respect to the Refunding Bonds; provided the disclosure obligations of the Agency shall be no more extensive than those in connection with the 2011 Series A Bonds under federal securities laws and Securities and Exchange Commission Rule 15c2-12. In the event that Agency is unable to meet its obligation to provide certain financial and operating data relating to such Agency, and is therefore unable to meet all acts, conditions and things required by law to be done or performed in strict conformity with the laws authorizing the issuance of general obligation refunding bonds, then the District may provide an amount (the "Advance") necessary to effectuate a refunding of the installment purchase portion of the original Tax-Exempt Obligations attributable to the Agency (the "Agency's Installment Purchase Obligation") on the scheduled closing date for the refunding bonds. Such an Advance by the District shall be considered a loan to the Agency, and the Agency shall thereafter be obligated to continue to make payments to the ~·· .. 1 ' ,,~ f ... ,. • ' ' -I ' ~ ( . .. .,.. • ,. --,f • • .. District in accordance with the original Agency Debt Service schedul"e · r'elated to the Agency's Installment Purchase Obligation as though the original Tax-Exempt Obligation I ff' •.,. ' I :;.-"f '"• •~..._f had never been refunded until such time as the Advance, plus interest accrued thereon at the interest rate applicable to the original Tax-Exempt Obligations, shall be repaid to the District in full. Page 54 of 58 Page 94 of 512 IN WITNESS WHEREOF, the parties hereto have executed this Contract on the dat es set forth below. APPROVED AS TO FORM : County Counsel BY: ~~Counsel ATTEST: SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION ~TRIY• 8 BY: 6 ' l, 1)M!-,tv-- Chair, Board of Supervisors Date : li0tJ l.4Sf 2,:!>,t ZC't/l/ Address fo r Notices: Department of Public Works County Government Center San Luis Obispo, California 93408 Attn : Director of Public Works a.. -' -"' sa.--rvi.so't"'S County Clerk of 4+\e. ~d.'""' U"f -r- BY : J 1 {UJ )1 1,l, /j(/),1 Deputy Cle""' of .ff,,ti &o.nl The undersigned Deputy Clerk of the Board of Supervisors certifies that, pursuant to S~ction 25103 of the Government Code , delivery of \~ts docua t has been made on t\id~i4S t 2'1, 2U WADE HORTON County Clerk of the Board and Ex~Officio Clerk of the Board of Supervisors ltw ,1uiliYi By, _ _J _ _J~~~-S ~k~..:----Deputy Cler THE CITY OF ARROYO GRANDE BY : ________ _ Mayor Address fo r Notices: 300 Ea st Branch Street Arroyo Grande, CA 93420 Attn : City Manage r Page 55 of 58 Page 95 of 512 ATTEST: BY: ________ _ APPROVED AS TO FORM: City Attorney BY: ------------ Timothy J. Carmel L:\Utilities\2022\August\BOS\Zone 3 Amended Restated Contracts\Zone 3 Agency Contracts\Zone 3 2022 Contract_ The City of Arroyo Grande .docx.JO.sc Page 56 of 58 Page 96 of 512 EXHIBIT A-THE PROJECT Alluvium Strengthening A portion of the downstream shell of Lopez Dam will be removed temporarily to allow access for strengthening of the foundation with stone columns.' The area of alluvium to be excavated would extend about 150 feet downstream from the existing toe of the dam, and the excavation would be to approximately elevation 340 feet in the center and to 370 feet on the sides. The total volume of excavated materials to be temporarily stored is estimated to be 400,000 to 500,000 cubic yards (cy). This includes the topsoil, which will be salvaged and stored separately. During excavation of the alluvium and installation of the stone columns, groundwater will need to be lowered as much as 30 feet in the excavation area . In addition, the outlet control building, portions of the associated piping, and the outflow channels connecting to Arroyo Grande Creek will need to be relocated downstream prior to the excavation, or a temporary bypass will need to be constructed, so that the outlet works can remain operational during the work. The bypass flows could enter the creek either through an existing pipe that discharges at the County property line (about 1,000 feet downstream) or at a location developed by the construction contractor nea r the western edge of the abandoned trout farm ponds. The outlet control building will be moved approximately 300 feet west along the access road while the channels will be moved into either one or two new channels 50 to 200 feet downstream from the existing discharge location . Stone columns will be installed using a crane -operated vibrating probe. The vibration acts to densify and strengthen the ground, and the stone columns provide additional strength. Approximately 2000 column s, approximately 3 to 4 feet in diameter, will be installed in a triangular' pattern with the columns spaced at approximately 7 to 9 feet on centers. The area of installation will extend from abutment to abu t ment (approximately 570 feet) and be about 200 feet in width (upstream/downstream distance) under the existing berm of the downstream shell. Gravel material for the stone columns (65,000 to 75,000 cy) will be imported by truck throughout the process. The downstream berm, including the fi lter/d r ain material, will be replaced after the columns are installed using the material removed and stored as well as additional filter/drain material imported from a commercial source. Additional buttress material will be placed over the downstream shell after the stone columns are installed and the alluvium and shell materials that were removed are replaced . As a result, the Dam crest would be widened by approximately 130 feet. The buttress may be extended if testing during stone column installation indicates that st r engthening of the alluvium is less than predicted . This additional buttress would require 200,000 to 400,000 cy of material. Water level in the reservoir will need t o be maintained at or below the currently mandated level of 510 feet, possibly down to elevation 480 feet. Construction is estimated to take approximately 18 months. Pag e 57 o f 58 Page 97 of 512 Dewatering will be necessary during excavation of the alluvium to elevation 340 feet, installation of the central stone columns, and replacement of the alluvium to maintain the ground water level approximately 10 feet below the excavated ground surface . Dewatering may also be required during excavation ground surface . Dewatering may also be required during excavation of the borrow material for the buttress if groundwater is encountered . Borrow areas for material needed in strengthening the dam can come from the Arroyo Grande Creek floodplain downstream of the dam that was excavated during the original construction of the dam . Approximately 25,000 to 35,000 cy of commercially obtained materials are expected to be required for "filter and drain" zones of the Dam . The materials will be needed at the beginning of backfill after the stone columns are completed . Appurtenant Facility Improvements The left abutment has been suspected of having seepage, and the spillway structure (on the right abutment) requires repairs to areas of the concrete floor and walls. Construction activities will occur at the spillway and at the left abutment to correct these problems. Seepage in the left abutment may have carried some abutment materials out though the drains in the dam, resulting in voids. Grouting will be used to reduce this seepage by filling any such voids . This work is independent of the remediation activities and could be performed in parallel with them . Page 58 of 58 Page 98 of 512 NOTICE OF INTENT TO ADOPT A NEGATIVE DECLARATION Pursuant to the California Environmental Quality Act (CEQA) Who:County of San Luis Obispo Flood Control and Water Conservation District What:A Negative Declaration (ND) has been prepared and issued for the County of San Luis Obispo Flood Control and Water Conservation District (District) Lopez Water Project Contract Changes. The District is proposing to restate and amend the existing water supply contracts for the Lopez Water Project to allow the Contractors to store their unused annual water entitlement in Lopez Reservoir for future use. The purpose of the proposed change is to provide the Contractors gre ater flexibility to better manage their water supply portfolios, which may also include groundwater and allocations from the State Water Project. The project is expected to improve water supply resiliency for the region. Where:Copies of the proposed ND and all the associated documents referenced in the ND are available for review at the County of San Luis Obispo Department of Public Works, 976 Osos Street, County Government Center Room 206, San Luis Obispo, CA 93408. The ND is also accessible on the Public Works website at https://slocounty.ca.gov/PW/Lopez-Water- Project-MND. Comments:The 30-day review and comment period for the proposed ND begins on January 28, 2022, and ends on February 28, 2022. Written comments must be received by 5:00 p.m. on the last day of the review period and should be addressed to: Monica Stillman, Environmental Specialist, mjstillman@co.slo.ca.us, County Government Center, Room 206, San Luis Obispo, CA 93408. Public Hearing: The County of San Luis Obispo Board of Supervisors will hold a public hearing to consider the adoption of the Negative Declaration. The hearing is anticipated to be held in Spring, 2022. Interested persons can access the Board of Supervisor’s agenda at http://www.slocounty.ca.gov/bos/BOSagenda.htm to locate the date of the public hearing for this project. Attachment 2 - page 1 of 96 ATTACHMENT 3 Page 99 of 512 Project Number Project Name Initial Study -Environmental Checklist PLN-2039 04/2019 Project Title & No. Lopez Water Project Contract Changes (ED20-210, 552R235020) ENVIRONMENTAL FACTORS POTENTIALLY AFFECTED: The proposed project could have a "Potentially Significant Impact" for environmental factors checked below. Please refer to the attached pages for discussion on mitigation measures or project revisions to either reduce these impacts to less than significant levels or require further study. D Aesthetics D Greenhouse Gas Emissions D Public Services D Agriculture & Forestry D Hazards & Hazardous Materials D Recreation Resources D Hydrology & Water Quality D Transportation D Air Quality D Land Use & Planning D Tribal Cultural Resources D Biological Resources D Mineral Resources D Utilities & Service Systems D Cultural Resources D Noise 0 Wildfire D Energy D Population & Housing D Mandatory Findings of D Geology & Soils Significance DETERMINATION: (To be completed by the Lead Agency) On the basis of this initial evaluation, the Environmental Division Manager finds that ~ The proposed project COULD NOT have a significant effect on the environment, and a NEGATIVE DECLARATION will be prepared. D Although the proposed project could have a significant effect on the environment, there will not be a significant effect in this case because revisions in the project have been made by or agreed to by the project proponent. A MITIGATED NEGATIVE DECLARATION will be prepared. D The proposed project MAY have a significant effect on the environment, and an ENVIRONMENTAL IMPACT REPORT is required. D The proposed project MAY have a "potentially significant impact" or "potentially significant unless mitigated" impact on the environment, but at least one effect 1) has been adequately analyzed in an earlier document pursuant to applicable legal standards, and 2) has been addressed by mitigation measures based on the earlier analysis as described on attached sheets. An ENVIRONMENTAL IMPACT REPORT is required, but it must analyze only the effects that remain to be addressed. D Although the proposed project could have a significant effect on the environment, because all potentially significant effects (a) have been analyzed adequately in an earlier EIR or NEGATIVE DECLARATION pursuant to applicable standard_s, and (b) have been avoided or mitigated pursuant to that earlier EIR or NEGATIVE DECLARATION, including revisions or mitigation measures that are imposed upon the proposed project, nothing further is required. Monica Stillman . ),:~~---u..-/-,.,:z Y--20.--<"< Prepared by(Print) Signature// ----· -----------Date . /__ Keith Miller ~-/ d 1/ ~;)-. -R-ev-ie_w_e_d-by-(P-r-in-t) ___ Sig ature Da?e / 976 0505 STREET, ROOM 206 I SAN LUIS OBISPO, CA 93408 1(805) 781-5252 I TTY/TRS 7-1-1 publicworks@co.slo.ca.us I www.slocounty.ca.gov PAGE 1 OF 55 Attachment 2 - page 2 of 96Page 100 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 2 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Project Environmental Analysis The County's environmental review process incorporates all of the requirements for completing the Initial Study as required by the California Environmental Quality Act (CEQA) and the CEQA Guidelines. The Initial Study includes staff's on-site inspection of the project site and surroundings and a detailed review of the information in the file for the project. In addition, available background information is reviewed for each project. Relevant information regarding soil types and characteristics, geologic inf ormation, significant vegetation and/or wildlife resources, water availability, wastewater disposal services, existing land uses and surrounding land use categories and other information relevant to the environmental review process are evaluated for each project. Exhibit A includes the references used, as well as the agencies or groups that were contacted as a part of the Initial Study. The County Public Works Department uses the checklist to summarize the results of the research accomplished during the ini tial environmental review of the project. Persons, agencies or organizations interested in obtaining more information regarding the environmental review process for a project should contact the County of San Luis Obispo Public Works Department, 976 Osos Street, Rm. 206, San Luis Obispo, CA, 93408-2040 or call (805) 781-5252. A. Project DESCRIPTION: The San Luis Obispo County Flood Control and Water Conservation District (District) proposes to restate and amend its existing water supply contracts with the Zone 3 Lopez Dam water supply Contractors (project). The Contractors include the Cities of Arroyo Grande, Grover Beach and Pismo Beach, the Oceano Community Services District, and the County Service Area 12 (Avila Beach). This Initial Study provides a description of the project and expected outcomes. Hydrologic modeling was conducted to evaluate the expected outcomes of the project. Modeling results are summarized below and are described in more detail in Attachment A. The District’s current water supply contracts with the Contractors provide an annual entitlement of water from the Lopez Reservoir (entitlement) and the option to purchase surplus water (if available), which consists of unused annual entitlements and unreleased downstream releases from the previous water year. Contractors have one year to use the surplus water and can only use it after they use their full entitlements. Any unused surplus water then reverts back to being water available to the District for annual entitlements and downstream releases in the subsequent year. This contractual structure creates a “use it or lose it” scenario and does not provide any direct incentive for the Contractors to limit their use of Lopez Water and preserve local water supplies. The District, on behalf of the Contractors, is proposing to restate and amend its existing water supply contracts to allow the Contractors to store their unused annual water entitlement and any surplus water they receive in Lopez Reservoir, as well as allow for in-lieu storage of State Water Project (SWP) water. In other words, each Contractor would have a stored water account. The purpose of the proposed changes is to provide the five Contractors greater flexibility to better manage their water supply portfolios and incentivize conservation of water during emergencies and droughts. The project would provide the Contractors greater flexibility to use their water supplies conjunctively (i.e., to implement a balanced use of surface and groundwater supplies based on hydrologic conditions) and additionally allow Contractors to transfer stored Lopez and SWP water amongst themselves to improve water supply availability during drought conditions and water supply resiliency for the region. Attachment 2 - page 3 of 96 Page 101 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 3 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov The project would increase the likelihood that Zone 3 Contractors with existing SWP water allocations will use their allocations more fully by either delivering to their customers or offsetting Lopez Water delivery requests from other Zone 3 Contractors. In this scenario, because there is no direct physical connection between Lopez Reservoir and the SWP, no actual SWP water would physically be in the reservoir. Rather, the exchange would be an in-lieu exchange that occurs on paper through the water accounting process. Background: The Lopez Dam and water supply facilities (Lopez Project) are owned and operated by the District and located on Lopez Drive in unincorporated County land approximately seven miles east of Arroyo Grande, in the South County planning area (Huasna-Lopez sub area), in Supervisorial District 4 (Figure 1, Vicinity Map). The Contractors have service areas in the San Luis Obispo Planning Area (San Luis Bay Inland Sub Area North and Sub Area South), San Luis Bay Coastal Planning Area, and the South County Coastal Planning Area, and Supervisorial Districts 3 and 4. The Zone 3 boundaries are shown in Figure 1. The proposed project would not affect the following existing (i.e. “baseline”) characteristics of the reservoir and District operations: • The safe yield of the reservoir is recognized as 8,730 acre-feet per year (AFY) • The reservoir maximum capacity would remain 49,388 acre-feet (AF) • Entitlements for the Contractors total 4,530 AFY • The District would maintain downstream releases of up to 4,200 AFY (3,800 AFY average) • The water level of the reservoir can fluctuate from year to year and/or within a given year, due to hydrologic cycles, Contractor demand, and downstream releases. • The reservoir is generally highest in late winter and lowest in late summer. • If the reservoir falls to 20,000 AF or less, and a drought emergency declared, the District would consider modifying operations as previously done through use of a Low Reservoir Response Plan (LRRP), or similar. Additionally, the District relies on the Interim Downstream Release Schedule (IDRS), adopted by the District’s Board of Supervisors in 2007 (District 2007), to manage its downstream releases until such time as a more permanent operations plan and associated Habitat Conservation Plan (HCP) are completed. In the short term, the proposed contract changes would not affect the downstream releases or implementation of the IDRS, which is used to maintain baseline habitat conditions for environmental resources and provide water for downstream agricultural uses. Modeling Methodology: The County developed a model to simulate operation of the Lopez Water Project. This model was used to evaluate Contractor water availability and Lopez Reservoir conditions under two scenarios: 1) the existing (baseline) conditions, and 2) with the proposed contract changes (Project) in effect (Attachment A). The modeling used the previous 51 years of hydrology (i.e. daily rainfall and inflow from 1969 – 2020) as a baseline for the next fifty-one years. It should be noted that 1969 was a “wet year”, with 40.25 inches of rain falling – enough to fill the newly constructed reservoir. The potential effects of climate change were included in both scenarios. The climate change adjustments were taken from the California Water Commission’s recommended approach for evaluating effects of climate change for Water Storage Investment Program applications (CWC 2021). It should also be noted that the climate change adjustments and all modeling results become increasingly speculative over the 51-year modeling period. The modeling scenarios assumed that the District’s adopted IDRS would continue unchanged, that there would be no change in each Contractors’ entitlement, and no change in Contractors’ groundwater extraction targets. To be conservative, the modeling assumed that downstream releases would be 4,100 AFY, slightly Attachment 2 - page 4 of 96 Page 102 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 4 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov above recent average. The model inputs for the baseline scenarios used year 2035 demands and assumed that water sources would be used in the following order to meet demands: 1) Lopez Entitlement Water 2) Imported State Water Project Water 3) Groundwater allocations in accordance with current limitations Under the proposed project, the County would not dictate how each Contractor should manage its water supplies. However, it is anticipated that the Contractors would manage water use to fulfill their service needs while maximizing conservation of supplies for later use and minimizing water losses. Therefore, for the project scenarios, two water management scenarios were modeled to compare project impacts. Those two scenarios as described in Attachment A are: • Scenario E: Contractors maximize their Lopez water supply storage account. • Scenario F: Contractors who have an allocation of SWP water maximize their SWP storage account. Differences between these two scenarios were minor (Table 12 in Attachment A, comparison of Scenarios E and F to baseline conditions with effects of climate change included). For simplicity, and to capture the worst- case low water scenario in the reservoir, this Initial Study presents potential impacts associated with Scenario F, which maximizes SWP storage. Under Scenario F Contractors would use the following order of water supply use to meet demands: 1) Lopez Entitlement Water 2) Groundwater allocations in accordance with current limitations 3) Imported State Water Project Water 4) Stored Lopez water 5) Stored SWP Water Model Results: Attachment A provides scenario results related to: • Annual Lopez Lake Levels • Annual Downstream Releases • Annual Evaporation • Spill Events • Spill Event Daily Peak Rates • Contractor Storage, including amount stored, amount used, and lost during a spill These results are summarized in the text and tables that follow , with the exception of individual Contractor storage amounts. Attachment A provides modeled annual water deliveries for each Contractor in Tables 8 - 10. In general, it is expected that as a result of the project, modeled annual average water delivered and stored from existing sources would remain unchanged for CSA 12, would include increased use of the existing SWP water allocations by Pismo Beach and Oceano, and increased use of Lopez water by Arroyo Grande. The project would not change Contractor’s maximum entitlements to Lopez water or allocations of SWP water, or where the water is used in their service areas. This means that the physical effects of the project are fully addressed by evaluating the net Project effects. Therefore, the individual Contractor storage model results in Attachment A are not addressed in this CEQA document. Due to the effects of climate change, even without the project, average annual inflows to Lopez Reservoir would potentially increase by 9.5% compared to the last 51 years (Table 7 in Attachment A), resulting in generally higher water levels in Lopez Reservoir during the modeling period (i.e., increase in Lopez Lake Attachment 2 - page 5 of 96 Page 103 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 5 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Storage shown by comparing Attachment A Table 11 without climate change to Table 12 with climate change). Project-related changes in how the Contractors use and store water are estimated to result in the following conditions in Lopez Reservoir: 1. The volume stored behind the dam would be incrementally greater on average than the baseline condition, meaning the reservoir would have, on average, higher water levels (Figure 2). 2. There would be an increase in spilled water. Over a 51-year period baseline total spill volume would be 290,711 AF. With the project, the total spill volume would be 317,520 AF, an increase of 26,809 AF. 3. Spills would occur in 20 out of 51 years without the project, and 21 out of the next 51 years with the project. 4. There would be an increase in evaporative loss due to slightly higher reservoir levels. The model predicts that baseline evaporation loss would be 137,545 AF. With the project, the estimated loss would be 140,792 AF, an increase of 3,247 AF. 5. Expected occurrence of low water limitations would decrease. The IDRS includes a Low Reservoir Response Plan, which is potentially placed into effect when the reservoir is at or below 20,000 AF. The model predicts that over a 51-year period without the project, the reservoir would drop below 20,000 AF in approximately 7 out of 51 years. With the project, this condition is predicted to occur in 5 out of 51 years. Relative effects of the project on reservoir spills, evaporation and low water years are shown in Table 3. Table 3. Predicted Project-Related Effects over 51 Years Baseline (Scenario D) Project (Scenario F) Difference Spill Events 20 21 +1 Spilled Water (AF) 290,711 317,520 +26,809 (9%) Average Evaporation Loss (AF) 137,545 140,507 +2,962 (2%) # of Low Water Years 7 5 -2 Spills: Spilled water is that which exceeds the capacity of the reservoir and flows over the spillway. This water is no longer available for Contractor use but would periodically increase flows downstream in Arroyo Grande Creek. The project-related increase of spill shown in Table 3 likely overstates actual spill amounts because the Contractors would have a financial incentive to prevent spill (i.e., preserve their stored water) through active management of their water portfolios. For example, given the high cost of State Water, Contractors will want to store it at Lopez reservoir when there is little risk of a spill and use it before that water is lost in a spill to avoid a financial loss. The modeling assumed that Contractors would store as much State Water as possible, which provides a reasonable worst-case scenario when it comes to spilled water. The total predicted increased spill amount is 26,809 AF, which could occur during 21 spill events in the 51-year modeling period. This corresponds to an average of approximately 1,276 AFY increase in spill volume during each spill. Through analysis of historic SWP operations, it was determined that approximately 7,000 AFY of District water has been lost due to spill at the SWP’s San Luis Reservoir on average over the last 26 years. Attachment 2 - page 6 of 96 Page 104 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 6 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Because the project would encourage in-lieu exchanges of SWP water and Lopez water, the increased spill volume at Lopez should be balanced by a decrease in spill volume at San Luis Reservoir. In terms of spill effects on Arroyo Grande Creek downstream of the dam, the majority of the predicted project- related spill events would result in incremental increases in volume that would be within the range of baseline spill magnitudes. This is discussed further in Section X – Hydrology and Water Quality. The effects of these incremental increases on peak flow rates in Arroyo Grande Creek are depicted graphically for three different locations along Arroyo Grande Creek shown in Figure 3: just below Lopez Dam (modeling results in Figure 4), the AG Stream Gage near Stanley Avenue in the City of Arroyo Grande (Figure 5), and the 22nd Street bridge in Oceano (Figure 6). These locations were selected because there are flow monitoring devices that have been in use at these sites for many years. Additionally, the 22nd Street location is in the District’s Zone 1/1A managed flood control channel, which consists of levees along the lower three miles of Arroyo Grande Creek. Evaporation: The estimated project-related effects on evaporation constitute a 140,507 AF loss over the 51- year modeling period, or an average of 2,702 AFY more than baseline conditions (Table 16 in Attachment A). Other Considerations: Physical conditions within the Contractors’ service areas in Zone 3 vary widely. The project would potentially alter how much of each Contractors’ Lopez supply is used each year, but the project would not alter how much water each Contractor provides to their customers or where/how that water is used. Further, the proposed project would not require any physical improvements to the Lopez Project, which includes the reservoir, water treatment and delivery infrastructure. The Existing Setting section below focuses on the Lopez Reservoir and the downstream Arroyo Grande Creek channel, where direct physical impacts would be more likely to occur, rather than the entirety of the Zone 3 boundary. ASSESSOR PARCEL NUMBER(S): multiple Latitude: 35 º 11' 20.58" N Longitude: -120º 29' 21.63" W SUPERVISORIAL DISTRICT # 4 B. Existing Setting Plan Area: South County Sub: Huasna-Lopez Comm: Rural Land Use Category: Recreation Rural Lands Agriculture Residential, Urban Combining Designation: Sensitive Resource Area Flood Hazard Geologic Study Parcel Size: Varies Topography: Nearly level to Very steeply sloping Vegetation: Grasses Scattered Oaks Chaparral, Agriculture Existing Uses: Undeveloped recreation, agriculture, rural and suburban residential, urban Surrounding Land Use Categories and Uses – Lopez Reservoir: North: Open Space; rural lands recreation East: Agriculture; recreation rural lands South: Agriculture; rural lands West: Agriculture; Surrounding Land Use Categories and Uses – Arroyo Grande Creek: Upstream: Agriculture, rural, rural residential Downstream: Urban, rural and suburban residential, agriculture, recreation Attachment 2 - page 7 of 96 Page 105 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 7 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov C. Environmental Analysis The Initital Study Checklist provides detailed information about the environmental impacts of the proposed project and mitigation measures, if applicable, to lessen the impacts. Attachment 2 - page 8 of 96 Page 106 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 8 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Figure 1. Lopez Project Vicinity Map ZONE 3 WATER SYSTEM CSA 1 , TU ' I ' I I . ~ Lopez " \ ,', ... , ... I •> 0 5,000 10,000 SAN LUIS OBISPO COUNTY/ CITY OF GROVER BE TURNOµT SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT BOUNDARY _______ , ', I OCEANO~fl.JRNOUT .-_, I I ' Legend -LOPEZ WATER TRANSMISSION LINE : ___ :ZONE 3 BOUNDARY JJCZ.3.POP' Pr.pared 11/15/200$ by O R:ao n SLO CCIU NTV AJBLIC Y<ORKS O!Pr Attachment 2 - page 9 of 96 Page 107 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 9 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Figure 2. Predicted project-related increase in Lopez Reservoir water levels. 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 2012 2016 2020Storage, Acre-FeetBaseline (Scenario D)Maximize SWP Storage (Scenario F) Attachment 2 - page 10 of 96 Page 108 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 10 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Figure 3. Locations analyzed for project-related increases in channel flow due to spill. LOPEZ WATER PROJECT CONTRACT CHANGES, San Luis Obispo County, CA 1: 117 ,796 0 2 COUNTY OF SAN LUIS OBISPO DEPARTMENT OF PUBLIC \f\,ORKS 4 Miles Map by: staff Printed : 12/2/2021 0 Attachment 2 - page 11 of 96 Page 109 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 11 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Figure 4. Annual peak spill rates downstream from Lopez Dam. 3000 2500 2000 ~ u s"' 1500 0 LL 1000 500 0 I ro°' ~ ~'? {>} ~~ {>} 9:,~ {'i ■ Baseline (D) I I 11 ~ {'i 9:,°' {') ?,'? ~ ?,~ ~ c~ ~ c<-> ~ c°' ~ 'S' ~ ~ ~ ■ Increase Due to Project, Maximize SWP Storage (F) Attachment 2 - page 12 of 96 Page 110 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 12 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Figure 5. Annual peak flow rates at the Arroyo Grande stream gage near Stanley Avenue. 6000 5000 4000 ~ u s' 3000 0 u.. 2000 1000 0 ro°' ~ ._.I --- C\'\, ~ C\<, ~ C\'o ~ 9,",, ~ ■ Baseline (D) IJ --111 I I --l _l _1 --I •- ~ ~ ~ ~ 0<::; ~ 0'» ~ 0'o ~ 0°' ~ o""' o<, o'o ~,.._,, ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ■ Increase Due to Project, Maximize SWP Storage (F) Attachment 2 - page 13 of 96 Page 111 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 13 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Figure 6. Annual Peak flow rates at the 22nd Street Bridge in Oceano. 6000 5000 ------------------------------------------~ Capacity of AG Creek Flood Control Channel 4000 ~ 3000 u ~~ 0 LL. 2000 1000 I 0 ._.I -IJ --111 _ ■ --l _l _1 -I ■ - ro°' {» ~~ ~ ~<, ~ ~'b ~ 9:,"Y ~ ~ {') !b' {') ?P {» PJ,,, {» PJ(o {» PJ°' {» c~ ~ c"' ~ c'b ~ ~"Y ~ ~ ~ ~ ~ ~ ~ -1000 Baseline (D) Increase Due to Project, Maximize SWP Storage (F) - - -Channel Capacity Attachment 2 - page 14 of 96 Page 112 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 14 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov I. AESTHETICS Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Except as provided in Public Resources Code Section 21099, would the project: (a) Have a substantial adverse effect on a scenic vista? ☐ ☐ ☒ ☐ (b) Substantially damage scenic resources, including, but not limited to, trees, rock outcroppings, and historic buildings within a state scenic highway? ☐ ☐ ☐ ☒ (c) In non-urbanized areas, substantially degrade the existing visual character or quality of public views of the site and its surroundings? (public views are those that are experienced from publicly accessible vantage point). If the project is in an urbanized area, would the project conflict with applicable zoning and other regulations governing scenic quality? ☐ ☐ ☒ ☐ (d) Create a new source of substantial light or glare which would adversely affect day or nighttime views in the area? ☐ ☐ ☐ ☒ Setting The Lopez Reservoir and surrounding hills have high scenic value. The setting is in undeveloped hills with scattered coastal oak woodland. Lopez Drive is the primary publicly accessible road in the vicinity and it follows the meandering south and southeastern shoreline of the reservoir with expansive views of the reservoir and surrounding hills. The Lopez Recreation Area at the north side of the reservoir supports recreational uses on land and on the water, for which the aesthetics of the reservoir and surrounding open space is an important component of the character of the park. Arroyo Grande Creek downstream from the dam is bordered by a variety of land uses and settings, including open space, agricultural fields, vegetated riparian corridors, and residential and urban development. Discussion (a) Have a substantial adverse effect on a scenic vista? The project could result in changes in the water level in the reservoir, but these changes would be within the range of current water level fluctuations that result from changes in hydrology (e.g., rain, runoff), climate trends, and Contractor demand. The project would not result in a significant lowering of the reservoir levels, for example, which could impact the aesthetics of the reservoir when viewed from trails and the campground. The small-scale changes in water levels (up or down) over time that could result from the project changes Attachment 2 - page 15 of 96 Page 113 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 15 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov would not impact scenic vistas at the reservoir. Similarly, project-related changes in flow in Arroyo Grande Creek would not affect the scenic character of the creek downstream from the dam. (b) Substantially damage scenic resources, including, but not limited to, trees, rock outcroppings, and historic buildings within a state scenic highway? The project is not located on or near a designated state scenic highway and would not require construction or other activities that could damage scenic resources. The upper limit on reservoir water level is controlled by the spillway, so the project would not result in shoreline flooding in new areas. Project-related effects on flow in Arroyo Grande Creek are not expected to change existing channel or bank conditions. Therefore, the project is not expected to damage existing scenic resources such as trees. (c) In non-urbanized areas, substantially degrade the existing visual character or quality of public views of the site and its surroundings? (Public views are those that are experienced from publicly accessible vantage point). If the project is in an urbanized area, would the project conflict with applicable zoning and other regulations governing scenic quality? Direct project effects in Lopez Reservoir are in a non-urbanized area. Potential indirect effects on flow conditions in Arroyo Grande Creek could affect a variety of land uses downstream from the dam, including non-urbanized and urbanized areas. The project would maintain the existing character and quality of public views from surrounding public roads and the Lopez Lake Recreation Area. The project may result in changes in the water level in the reservoir, but those changes would fall within the normal range of current reservoir conditions and operations. Project-related water levels in the creek would not be substantial enough to change the character of existing views or conflict with any regulations governing scenic quality. (d) Create a new source of substantial light or glare which would adversely affect day or nighttime views in the area? The project would not introduce any new lighting or other sources of glare. Conclusion/Mitigation Aesthetic impacts of the project would be limited to potential changes in reservoir water level and Arroyo Grande Creek flow that are within the historic and current range of water levels resulting from existing reservoir conditions and operations. As such, the project would have no significant adverse aesthetic impacts and no mitigation measures are required. Attachment 2 - page 16 of 96 Page 114 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 16 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov II. AGRICULTURE AND FORESTRY RESOURCES Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact In determining whether impacts to agricultural resources are significant environmental effects, lead agencies may refer to the California Agricultural Land Evaluation and Site Assessment Model (1997) prepared by the California Dept. of Conservation as an optional model to use in assessing impacts on agriculture and farmland. In determining whether impacts to forest resources, including timberland, are significant environmental effects, lead agencies may refer to information compiled by the California Department of Forestry and Fire Protection regarding the state’s inventory of forest land, including the Forest and Range Assessment Project and the Forest Legacy Assessment project; and forest carbon measurement methodology provided in Forest Protocols adopted by the California Air Resources Board. Would the project: (a) Convert Prime Farmland, Unique Farmland, or Farmland of Statewide Importance (Farmland), as shown on the maps prepared pursuant to the Farmland Mapping and Monitoring Program of the California Resources Agency, to non-agricultural use? ☐ ☐ ☐ ☒ (b) Conflict with existing zoning for agricultural use, or a Williamson Act contract? ☐ ☐ ☐ ☒ (c) Conflict with existing zoning for, or cause rezoning of, forest land (as defined in Public Resources Code section 12220(g)), timberland (as defined by Public Resources Code section 4526), or timberland zoned Timberland Production (as defined by Government Code section 51104(g))? ☐ ☐ ☐ ☒ (d) Result in the loss of forest land or conversion of forest land to non-forest use? ☐ ☐ ☐ ☒ (e) Involve other changes in the existing environment which, due to their location or nature, could result in conversion of Farmland, to non-agricultural use or conversion of forest land to non-forest use? ☐ ☐ ☒ ☐ Setting The reservoir is surrounded by agricultural land uses to the east and west of the recreational lands bordering the reservoir, the outlet to the dam, and Arroyo Grande Creek downstream to the coast. These include vineyards, ranches, and row crops. Attachment 2 - page 17 of 96 Page 115 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 17 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov The reservoir is in the Arroyo Grande Valley Arroyo Grande Preserve Area. Surrounding agricultural lands downstream along the Arroyo Grande Creek corridor to Oceano include numerous parcels that are under Williamson Act contract and/or have prime farmland soils. These agricultural operations have generally been active for decades, are commonly developed with high value row crops and related infrastructure , and are highly productive. There are no managed forest lands or timberland at or near the reservoir or along Arroyo Grande Creek downstream of the dam. The reservoir is predominantly surrounded by central coast scrub and scattered oak woodlands. Discussion (a) Convert Prime Farmland, Unique Farmland, or Farmland of Statewide Importance (Farmland), as shown on the maps prepared pursuant to the Farmland Mapping and Monitoring Program of the California Resources Agency, to non-agricultural use? The project would not have any direct physical effects on any farmland in the vicinity . The project would not change the baseline dam releases that provide water for downstream agricultural use. Project-related increases in spill have the potential to incrementally increase downstream flow conditions, which could have minor beneficial effects for irrigation. Any such increases are predicted to be within the existing range of channel flow volumes and are not expected to increase the frequency or severity of flooding of agricultural lands (refer to discussion in Hydrology and Water Quality Sec tion). As such, the project is not expected to result in any conversion of farmland to non-agricultural use. (b) Conflict with existing zoning for agricultural use, or a Williamson Act contract? The project would not affect access to or use of nearby agricultu ral lands including Williamson Act contract properties. (c) Conflict with existing zoning for, or cause rezoning of, forest land (as defined in Public Resources Code section 12220(g)), timberland (as defined by Public Resources Code section 4526), or timberlan d zoned Timberland Production (as defined by Government Code section 51104(g))? There are lands meeting the definition of 12220(g) (i.e., land that can support 10-percent native tree cover of any species, including hardwoods, under natural conditions, and that allows for management of one or more forest resources, including timber, aesthetics, fish and wildlife, biodiversity, water quality, recreation, and other public benefits) around Lopez Reservoir and bordering portions of Arroyo Grande Creek. However, the project would not affect the maximum water level in the reservoir, which is controlled by the spillway. Therefore, there would be no direct or indirect effects on forest lands around the reservoir. Project-related changes in flows in Arroyo Grande Creek downstream of the dam would be within the current range of flows and are not expected to increase the frequency or duration of flood conditions to an extent that could adversely affect forest lands. There are no known timberland production zones meetin g the definition of 51104(g) in the project vicinity (i.e., an area which has been zoned pursuant to Section 51112 or 51113 and is devoted to and used for growing and harvesting timber, or for growing and harvesting timber and compatible uses ). (d) Result in the loss of forest land or conversion of forest land to non -forest use? See above. The project would not directly or indirectly affect forest land or require conversion of any forest land to non-forest use. Attachment 2 - page 18 of 96 Page 116 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 18 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov (e) Involve other changes in the existing environment which, due to their location or nature, could result in conversion of Farmland, to non-agricultural use or conversion of forest land to non-forest use? As stated in (a), the project would not adversely affect existing downstream releases that support agricultural irrigation, and is not expected to have a material effect on downstream flooding. Therefore, the project would not result in changes that have the potential to convert farmland or forest land from existing uses. Conclusion/Mitigation The project would have no direct effects on agriculture operations, agricultural land, or forest land. Potential indirect effects on agricultural land due to project-related changes in Arroyo Grande Creek flows during high flow events are not expected to be of a magnitude that would result in adverse effects to forest land, farmland, or agricultural operations. No mitigation measures are required. III. AIR QUALITY Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Where available, the significance criteria established by the applicable air quality management district or air pollution control district may be relied upon to make the following determinations. Would the project: (a) Conflict with or obstruct implementation of the applicable air quality plan? ☐ ☐ ☐ ☒ (b) Result in a cumulatively considerable net increase of any criteria pollutant for which the project region is non- attainment under an applicable federal or state ambient air quality standard? ☐ ☐ ☐ ☒ (c) Expose sensitive receptors to substantial pollutant concentrations? ☐ ☐ ☐ ☒ (d) Result in other emissions (such as those leading to odors) adversely affecting a substantial number of people? ☐ ☐ ☐ ☒ Setting San Luis Obispo County is in non-attainment status for ozone and particulate matter 10 micrometers in size and smaller (PM10) under the California standards. This means that the state air quality standards for ozone and PM10 are not being met. The County’s Clean Air Plan describes strategies to reduce emissions of these pollutants with the goal of improving air quality to meet the state standards by the earliest possible date. For project-specific emissions analyses, the current guidance is the County APCD CEQA Air Quality Handbook (2012) and permits may be required from APCD for certain activities that affect emissions. Typical sources of emissions of particulate matter include excavation and soil grading activities. Typical sources of emissions that contribute to ozone levels include fossil fuel burning, such as by vehi cle and equipment engines and generators. Attachment 2 - page 19 of 96 Page 117 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 19 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Additional air quality concerns include lead and asbestos either occurring in soil or in structures to be demolished. The Lopez dam and portions of the reservoir and downstream environment are within the APCD’s mapped naturally occurring asbestos buffer, meaning there may be natural sources of asbes tos in the soil that could be exposed through grading activities. The APCD responded to early consultation on the project by email dated November 3, 2020. Because there is no proposed construction, the APCD has no concerns with the project. Discussion (a) Conflict with or obstruct implementation of the applicable air quality plan? The source control measures in the Clean Air Plan are not directly applicable to the project. The project will not require or affect vehicle, equipment, or generator use such as by construction activities or generating new traffic. Accordingly, the project does not conflict with the Clean Air Plan. (b) Result in a cumulatively considerable net increase of any criteria pollutant for which the project region is non-attainment under an applicable federal or state ambient air quality standard? The project will not result in any temporary or permanent emissions that would affect ozone or PM10 (dust) levels. (c) Expose sensitive receptors to substantial pollutant concentrations? In accordance with the APCD Handbook, sensitive receptors are people that have an increased s ensitivity to air pollution or environmental contaminants. Sensitive receptor locations include schools, parks and playgrounds, day care centers, nursing homes, hospitals, and residential dwelling units. Sensitive receptors in the vicinity of the project include recreational users at Lopez Lake Recreation Area, and agricultural workers and residents in close proximity to any of the Lopez Project Facilities . The project would not require any construction or operational air emissions or any demolition, so there is no potential for adverse effects to sensitive receptors from diesel emissions, naturally occurring asbestos, or asbestos, lead, or other contaminants in soil or in structures to be demolished. (d) Result in other emissions (such as those leading to odors ) adversely affecting a substantial number of people? The project would not require construction or operational changes that would produce any other emissions. Conclusion/Mitigation The project would have no effect on air emissions or air quality and no mitigation measures are required. Attachment 2 - page 20 of 96 Page 118 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 20 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov IV. BIOLOGICAL RESOURCES Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Have a substantial adverse effect, either directly or through habitat modifications, on any species identified as a candidate, sensitive, or special status species in local or regional plans, policies, or regulations, or by the California Department of Fish and Game or U.S. Fish and Wildlife Service? ☐ ☐ ☒ ☐ (b) Have a substantial adverse effect on any riparian habitat or other sensitive natural community identified in local or regional plans, policies, regulations or by the California Department of Fish and Game or US Fish and Wildlife Service? ☐ ☐ ☒ ☐ (c) Have a substantial adverse effect on state or federally protected wetlands (including, but not limited to, marsh, vernal pool, coastal, etc.) through direct removal, filling, hydrological interruption, or other means? ☐ ☐ ☒ ☐ (d) Interfere substantially with the movement of any native resident or migratory fish or wildlife species or with established native resident or migratory wildlife corridors, or impede the use of native wildlife nursery sites? ☐ ☐ ☒ ☐ (e) Conflict with any local policies or ordinances protecting biological resources, such as a tree preservation policy or ordinance? ☐ ☐ ☐ ☒ (f) Conflict with the provisions of an adopted Habitat Conservation Plan, Natural Community Conservation Plan, or other approved local, regional, or state habitat conservation plan? ☐ ☐ ☒ ☐ Attachment 2 - page 21 of 96 Page 119 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 21 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Setting Lopez Reservoir The description of biological resources in and around Lopez Reservoir is based on the Lopez Drive Bridge Seismic Retrofit Project Natural Environment Study (SWCA, 2019). Habitat types present around the Lopez Reservoir shoreline include primarily live oak woodland and Central Coast scrub. These habitat types extend from the reservoir shoreline up to the Los Padres National Forest lands to the north and east. Ruderal habitats are present along the roadsides and in disturbed lakeshore locations. Ruderal habitats may have invasive plant specie s, including non-native grasses such as red brome and pampas grass. The lake shoreline experiences water level fluctuations in response to seasonal climatic conditions and Contractor demand. Central Coast scrub or wetland communities (e.g., mulefat) may develop during periods of low water and subsequently become inundated when the reservoir level rises. Jurisdictional waters present include the open water area of Lopez Reservoir. Vegetated wetlands are only present as ephemeral features in response to water level fluctuations. During preparation of the Natural Environment Study for the bridge project (2019), search of a five-mile radius around the reservoir resulted in 19 special-status plant species, 16 special-status wildlife species, and no Natural Communities of Concern. Special-status wildlife species with potential to occur at Lopez Reservoir include bald eagle, western pond turtle, California red-legged frog, nesting migratory birds, and roosting bats. Sport fish in the lake include red-ear sunfish, crappie, largemouth bass, smallmouth bass, and catfish. Non- native wildlife species that may be present in the lake include bullfrogs and crayfish. Arroyo Grande Creek Corridor The Arroyo Grande Creek corridor environment downstream from Lopez Reservoir is approximately 13 miles long and highly variable. Habitat types include, for example, central coast scrub, non-native annual grassland, chaparral, coast live oak forest, willow riparian, riparian woodland, open water, and agricultural and urban land. In many locations, these habitats intergrade due to local topographic changes as well as the intensity and type of historic development. Wetlands, beach and dune habitats, including the Meadow Creek and Arroyo Grande Creek Lagoons, are present at the creek outlet at the Oceano Dunes State Vehicular Recreation Area. The entire creek corridor is designated critical habitat by the National Marine Fisheries Service (NMFS) for the South-Central California Coast Steelhead (steelhead). The most downstream extent of the creek corridor is partially within critical habitat for the La Gracisoa thistle by the United States Fish and Wildlife Service (USFWS). As part of its long-term planning for the Lopez Dam, the District is in the process of developing a Habitat Conservation Plan (HCP) for the purpose of protecting and enhancing habitat conditions in Arroyo Grande Creek for steelhead and California red-legged frog (CRLF) pursuant to the federal Endangered Species Act. The HCP will address the operation of Lopez Dam (for example, storage and downstream release scenarios) along with potential habitat restoration activities downstream of the dam. HCP goals include maintaining sufficient attractant flows for migrating adult steelhead, and maintaining sufficient wetted p ools for juvenile steelhead and CRLF during low flow conditions. The HCP may result in modifications to dam releases and/or downstream flow conditions. Implications of the HCP for the Lopez water supply contracts would be evaluated through development of the draft and final HCP. The contracts would be amended, if necessary, after completion of the HCP process. The proposed contract provisions include clarifying that an HCP downstream release plan is a legally required water release and has priority over oth er Lopez water distributions. Attachment 2 - page 22 of 96 Page 120 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 22 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Other special-status species that are known to occur or could be present at times within the creek corridor include coast range newt, coast horned lizard, western pond turtle, California legless lizard, numerous bird species, bats, and plant species including Pismo clarkia and Santa Margarita manzanita, among others. California Department of Parks and Recreation (State Parks) is currently preparing an HCP for multiple species that exist in the Oceano Dunes State Vehicular Recreation Area (California State Parks 2020). Species covered in the HCP include California least tern, tidewater goby, western snowy plover, CRLF, and six plant species. Approximately the lower half mile of Arroyo Grande Creek is in the draft HCP coverage area. This area is monitored quarterly by State Parks for tidewater goby, steelhead, and CRLF. Discussion (a) Have a substantial adverse effect, either directly or through habitat modifications, on any species identified as a candidate, sensitive, or special-status species in local or regional plans, policies, or regulations, or by the California Department of Fish and Game or U.S. Fish and Wildlife Servi ce? While not protected as special-status species, CDFW manages the sport fish populations in the reservoir. Project-related changes in Lopez Reservoir water levels would not adversely affect sport fish in the reservoir and may provide incremental benefits for fisheries habitat through increased water levels and surface area of Lopez Reservoir. The project would not change the volume or timing of the downstream release schedules described in the adopted IDRS for protection of low-flow habitat conditions in Arroyo Grande Creek. The project could result in periodic increases in flow in Arroyo Grande Creek due to a nominal increase in occurrence and magnitude of downstream spill events (Figures 4, 5, and 6). The majority of the project-related increases in spill volume would occur in the winter and spring months when reservoir levels are higher and flows downstream are already high. The incremental increases in spill volumes would potentially improve downstream flows for adult and juvenile steelhead, which rely on sufficient creek flow for migration and deep- water refugia. At the downstream locations analyzed for spill effects, project-related increases in spill would not increase the magnitude of flow in the creek during the maximum spill event. For all smaller spill events, the project- related increases would be infrequent and would not approach the magnitude of the highest expected spill - or non-spill related flows in the creek. As such, the project is not expected to have adverse effects on existing habitat conditions in the creek or riparian zones that support special -status species of wildlife and plants. The project would not require any physical improvements and is not expected to have indirect effects that would affect special-status species. (b) Have a substantial adverse effect on any riparian habitat or other sensitive natural community identified in local or regional plans, policies, regulations or by the California Department of Fish and Game or US Fish and Wildlife Service? The Project could result in higher water levels in the Lopez Reservoir, but high-water conditions would be limited to the existing reservoir area which is limited by the existing height of the dam spillway. An increased frequency or duration of higher water levels in the reservoir would affect shoreline habitat areas that are already subjected to wide fluctuations in water level resulting from seasonal and long -term climatic conditions. As such, no adverse effects to riparian areas or other habitats are anticipated. Riparian habitat is widespread downstream of the Lopez Reservoir. Under existing conditions , the creek generally flows higher in the winter due to rainfall and reduced agricultural demand, and lower during the Attachment 2 - page 23 of 96 Page 121 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 23 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov summer months. Portions of the creek routinely go dry in the drier months. The proposed project would not result in changes to the current IDRS or quantity of downstream releases. The frequency and magnitude of project-related increases in spill, if realized, are not substantial enough that riparian habitats would be adversely affected (e.g., through increased scour or sediment deposits). (c) Have a substantial adverse effect on state or federally protected wetlands (including, but not limited to, marsh, vernal pool, coastal, etc.) through direct removal, filling, hydrological interruption, or other means? Lopez Reservoir has relatively steep shorelines. Wetlands may be present as temporary features that develop during low water conditions and that are submerged during high water conditions. The proposed project would not change that condition. The Arroyo Grande Creek corridor downstream from the dam generally consists of unvegetated channel and vegetated riparian banks constrained by flood control levees, providing limited space for development of wetlands. The downstream portion of Arroyo Grande Creek includes a wetland and lagoon complex known as Arroyo Grande Lagoon. Due to (1) the distance from the reservoir to this area, (2) that average downstream releases would not change under the proposed project, and (3) that project-related increases in spill would be relatively infrequent and within the range of existing, typical flow conditions, the proposed project is not expected to result in impacts to state or federal wetlands. (d) Interfere substantially with the movement of any native resident or migratory fish or wildlife species or with established native resident or migratory wildlife corridors, or impede the use of native wildlife nurser y sites? Project-related increases in reservoir water levels would not interfere with aquatic species movements, wildlife corridors, or nursery sites compared to existing conditions. Project -related effects on downstream conditions would be limited to relatively infrequent, incremental increases in flow due to spill. The project would not decrease downstream releases/flows during low flow conditions that would otherwise have the potential for adverse effects to aquatic species movement and nursery sites in Arroyo Grande Creek. The project-related short-term increases in downstream flows due to additional spill events would be well within the existing range of flow conditions in Arroyo Grande Creek; are expected to incrementally improve fish passage conditions; and are not expected to have material adverse effects on habitat conditions through increased channel scour, bank erosion, or related sediment deposits. (e) Conflict with any local policies or ordinances protecting biological resources, such as a tree preservation policy or ordinance? The project would not have any upstream watershed effects beyond the reservoir shoreline and downstream effects would be limited to infrequent, incremental increases in streamflow due to spill events. No construction, ground disturbance, or tree removal is proposed. (f) Conflict with the provisions of an adopted Habitat Conservation Plan, Natural Community Conservation Plan, or other approved local, regional, or state habitat conservation plan? There are two HCPs currently in development – the Oceano Dunes State Vehicular Recreation Area HCP and the Arroyo Grande Creek HCP. A draft Oceano Dunes HCP is currently available for public review. The Arroyo Grande Creek HCP is in earlier development stages, with modeling and in-stream habitat surveys conducted throughout 2021. Neither has been adopted at this point. The District anticipates the Arroyo Grande Creek HCP could result in the need for revisions in operation of the dam, particularly in regard to the timing and Attachment 2 - page 24 of 96 Page 122 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 24 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov volume of the downstream releases. The operations identified in the HCP would replace those currently implemented in the IDRS. The Oceano Dunes HCP includes coverage of the lower portion of Arroyo Grande Creek at the coast. The project-related effects on flow in Arroyo Grande Creek are expected to be infrequent and within the existing range of flow conditions. As such, they are not expected to conflict with the management objectives in the Oceano Dunes HCP. Conclusion/Mitigation The project would not result in adverse effects to biological resources. The HCP may result in future modifications to dam releases and/or downstream flow conditions. The environmental impact of those changes would be evaluated during subsequent environmental review. No mitigation measures are necessary. V. CULTURAL RESOURCES Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Cause a substantial adverse change in the significance of a historical resource pursuant to § 15064.5? ☐ ☐ ☒ ☐ (b) Cause a substantial adverse change in the significance of an archaeological resource pursuant to § 15064.5? ☐ ☐ ☐ ☒ (c) Disturb any human remains, including those interred outside of dedicated cemeteries? ☐ ☐ ☐ ☒ Setting No historical buildings, structures or sites listed in the California Register of Historical Resources are located in or near the reservoir (California Office of Historic Preservation 2021). One historical landmark on the State Register occurs in close proximity to Arroyo Grande Creek downstream of the dam: the Independent Order of Odd Fellows (IOOF) Lodge 258 building at 127 Bridge Street, Arroyo Grande. The building housed the lodge and the South Historic Society, but is now closed. It is separated from the creek riparian zone by a paved parking lot. With respect to archaeological resources, the project site lies within a region historically occupied by the Chumash. The Chumash occupied the coast between San Luis Obispo and northwestern Los Angeles County, inland to the San Joaquin Valley. They were divided into two broad groups, of which the Obispeño were the northern group. The Salinan were northern neighbors of the Chumash, and although the presence of a firm boundary between the Chumash and the Salinan is uncertain, ethnographic accounts have placed Salinan territories in the northern portion of the County. Neither tribal group has recognized tribal lands in the project area. For purposes of CEQA compliance, the County solicits and considers input from all interested tribal members through the Assembly Bill (AB) 52 Tribal Consulta tion process. Attachment 2 - page 25 of 96 Page 123 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 25 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Both tribes have a rich and complex history dating back as much as 10,000 years before present. The material culture and lifeways of the Northern Chumash appear to have been similar in many ways to their northern neighbors, the Salinan. The Northern Chumash had a complex system of social organization. They were hunter-gatherer-fishers and resided in numerous permanent villages and temporary camps, following annual cycles of hunting and gathering. Acorns provided a main staple of the diet. The Arroyo Grande Creek corridor and other creeks in the region are considered archaeologically sensitive because they provided access to water, fish, and a diversity of plants and animals associated with the riparian zones. A number of archaeological reports have been completed for past projects at or in the vicinity of Lopez Reservoir, including archival research of the entire Lopez Reservoir area (SWCA, 2018). Many of the archaeological investigations in the region resulted in significant archaeological finds. Consultation with Native American tribes for previous projects confirm the archaeological sensitivity of the area and the potential to encounter archaeological resources during ground disturbance activities. Discussion (a) Cause a substantial adverse change in the significance of a historical resource pursuant to § 15064.5? (b) Cause a substantial adverse change in the significance of an archaeological resource pursuant to § 15064.5? (c) The project would not result in new inundation areas or other physical impacts that could affect cultural resources. (d) Disturb any human remains, including those interred outside of dedicated cemeteries? In regard to (a) through (d), project effects would be limited to changes in the frequency and duration of water levels in currently managed surface waters, namely Lopez Reservoir and Arroyo Grande Creek. The project is not expected to result in new inundation areas, exposed areas, or physical improvements that could affect cultural resources. Periodic, incremental increases in flow in Arroyo Grande Creek due to project-related spill increases are expected to be well within the range of existing spill and storm flows in the Creek and are therefore not expected to adversely affect the building at 127 Bridge Street in Arroyo Grande. Conclusion/Mitigation The project would have no adverse effect on cultural resources and no mitigation measures are required. Attachment 2 - page 26 of 96 Page 124 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 26 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov VI. ENERGY Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Result in a potentially significant environmental impact due to wasteful, inefficient, or unnecessary consumption of energy resources, during project construction or operation? ☐ ☐ ☐ ☒ (b) Conflict with or obstruct a state or local plan for renewable energy or energy efficiency? ☐ ☐ ☐ ☒ Setting Energy considerations under CEQA are intended to evaluate projects with respect to the goals of decreasing energy consumption and reliance on fossil fuels, and increasing reliance on renewable energy sources (CEQA Guidelines Appendix F). Relevant factors for consideration can include energy consumption required for the project, compliance with energy standards, and effects of the project on local and regional energy supplies, electricity demand, and transportation energy requirements. Discussion (a) Result in a potentially significant environmental impact due to wasteful, inefficient, or unnecessary consumption of energy resources, during project construction or operation? The project would not change operation of the Lopez Project in a way that would materially affect energy consumption for project operation, including water filtration and conveyance to the Contractors. The project would not require new construction. (b) Conflict with or obstruct a state or local plan for renewable energy or energy effici ency? County energy efficiency programs are focused on building codes, construction workforce training, and residential energy efficiency assistance programs. These County efforts are not directly relevant to the project. Additionally, the project would not conflict with or obstruct any plans to develop renewable energy resources or increase energy efficiency. Conclusion/Mitigation The project would have no effect on energy resources and no mitigation measures are required. Attachment 2 - page 27 of 96 Page 125 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 27 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov VII. GEOLOGY AND SOILS Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Directly or indirectly cause potential substantial adverse effects, including the risk of loss, injury, or death involving: ☐ ☐ ☐ ☒ (i) Rupture of a known earthquake fault, as delineated on the most recent Alquist-Priolo Earthquake Fault Zoning Map issued by the State Geologist for the area or based on other substantial evidence of a known fault? Refer to Division of Mines and Geology Special Publication 42. ☐ ☐ ☐ ☒ (ii) Strong seismic ground shaking? ☐ ☐ ☐ ☒ (iii) Seismic-related ground failure, including liquefaction? ☐ ☐ ☐ ☒ (iv) Landslides? ☐ ☐ ☐ ☒ (b) Result in substantial soil erosion or the loss of topsoil? ☐ ☐ ☒ ☐ (c) Be located on a geologic unit or soil that is unstable, or that would become unstable as a result of the project, and potentially result in on- or off-site landslide, lateral spreading, subsidence, liquefaction or collapse? ☐ ☐ ☐ ☒ (d) Be located on expansive soil, as defined in Table 18-1-B of the Uniform Building Code (1994), creating substantial direct or indirect risks to life or property? ☐ ☐ ☐ ☒ (e) Have soils incapable of adequately supporting the use of septic tanks or alternative waste water disposal systems where sewers are not available for the disposal of waste water? ☐ ☐ ☐ ☒ Attachment 2 - page 28 of 96 Page 126 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 28 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact (f) Directly or indirectly destroy a unique paleontological resource or site or unique geologic feature? ☐ ☐ ☐ ☒ Setting The project area has very steeply sloping terrain around the shoreline of Lopez Reservoir, with gently sloping and level land bordering Arroyo Grande Creek downstream from the dam. The reservoir is not in the County’s geologic study area and is not in a mapped zone for landslide risk. There are potentially active faults trending northwest to southeast immediately downstream from the dam . Bedrock geology in the vicinity of the reservoir includes the Monterey Formation and the Santa Margarita Sandstone, which have high sensitivity for paleontological resources. There are Quaternary sedimentary formations in alluvial channels such as Arroyo Grande Creek. The soils map for the region indicates many different soil units, with variable characteristics. The entire county is mapped as a seismically active area. The bulk of the reservoir and the downstream area is mapped as a D 2 hazard zone based on the USGS Seismic Design Standards. A seismic retrofit of the dam was completed in 2006. Discussion (a) Directly or indirectly cause potential substantial adverse effects, including the risk of loss, injury, or death involving: (a-i) Rupture of a known earthquake fault, as delineated on the most recent Alquist -Priolo Earthquake Fault Zoning Map issued by the State Geologist for the area or based on other substantial evidence of a known fault? Refer to Division of Mines and Geology Special Publication 42. (a-ii) Strong seismic ground shaking? (a-iii) Seismic-related ground failure, including liquefaction? (a-iv) Landslides? In regard to seismic hazards, including (a-i) through (a-iv), the project would not alter operation of the Lopez Project, including the dam, spillway, and downstream channel, in a manner that would alter the seismic susceptibility of these project features. The project would not require construction of new infrastructure that would be subject to seismic design codes . (b) Result in substantial soil erosion or the loss of topsoil? The project would not result in Lopez Reservoir water level fluctuations or Arroyo Grande Creek flows that exceed existing conditions. The frequency and duration of high-water conditions in the reservoir may increase. This is not expected to result in an increase in shoreline instability or erosion. Attachment 2 - page 29 of 96 Page 127 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 29 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov The quantity of water lost over the dam due to spill events may increase slightly (an estimated additional 26,809 AF or 9.2% increase over 51 years) from existing conditions. Based on modeling, spill events are estimated to occur 21 times over the next 51 years compared to 20 times if the project is not implemented. Project-related increases in spill quantities would be within the range of the existing flow conditions in the creek downstream of the dam, including the gage downstream from the dam, the Arroyo Grande stream gage near Stanley Avenue, and at the 22nd Street Bridge (Figures 4, 5, and 6). As such, they are not expected to significantly increase channel scour or bank erosion or otherwise alter existing sediment transport processes in the creek. (c) Be located on a geologic unit or soil that is unstable, or that would become unstable as a result of the project, and potentially result in on- or off-site landslide, lateral spreading, subsidence, liquefaction or collapse? (d) Be located on expansive soil, as defined in Table 18-1-B of the Uniform Building Code (1994), creating substantial direct or indirect risks to life or property? (e) Have soils incapable of adequately supporting the use of septic tanks or alternative waste water disposal systems where sewers are not available for the disposal of waste water? In regard to (c) through (e), these conditions are n ot applicable because the project does not include new construction, installation of new septic tanks, or alternative wastewater disposal systems. (f) Directly or indirectly destroy a unique paleontological resource or site or unique geologic feature? While extensive areas around Lopez Reservoir are underlain by geologic units with high sensitivity for paleontological resources, the project would not require any ground disturbance or rock removal. Therefore, the project would not affect paleontological resources. Conclusion/Mitigation The project would not involve new construction or alteration of existing facilities that would trigger concerns related to seismic risk or disturbance of paleontological resources. The changes in water operations proposed for the project could result in changes in water levels in Lopez Reservoir and periodic , incremental increases in flow in Arroyo Grande Creek channel during spill events. Such changes are expected to be within the range of existing conditions and are not expected to result in an increase in sedimentation or erosion. No mitigation measures are necessary. VIII. GREENHOUSE GAS EMISSIONS Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Generate greenhouse gas emissions, either directly or indirectly, that may have a significant impact on the environment? ☐ ☐ ☐ ☒ Attachment 2 - page 30 of 96 Page 128 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 30 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact (b) Conflict with an applicable plan, policy or regulation adopted for the purpose of reducing the emissions of greenhouse gases? ☐ ☐ ☐ ☒ Setting Greenhouse Gas (GHG) Emissions are broadly recognized as contributing to an increase in the earth’s average surface temperature and long-term changes in climate. From the perspective of Public Works’ typical projects, the most common GHG emissions occur from burning fossil fuels, such as from vehicle exhaust . Additional sources include methane and nitrous oxide from agricultural activities, ozone that forms from precursors in vehicle emissions, and CFCs and hydrofluorocarbons in aerosols, building insulation, and fire suppression and, refrigeration materials. Discussion (a) Generate greenhouse gas emissions, either directly or indirectly, that may have a significant im pact on the environment? The project would not change Lopez Project operations in a material way that would affect energy use or associated emissions. The project would not change the extent to which water from Lopez Reservoir is used for agricultural irrigation and would not result in a change in existing agricultural uses. The project would not require construction, so would not generate construction emissions. (b) Conflict with an applicable plan, policy or regulation adopted for the purpose of reducing the emissions of greenhouse gases? The project would not increase transportation-related emissions and would not affect other sources of greenhouse gas emissions. Accordingly, the project would not conflict with any applicable plans, policies, or regulations intended to reduce greenhouse gas emissions. Conclusion/Mitigation The project would not alter existing GHG emissions or generate new sources of emissions. No mitigation measures are necessary. Attachment 2 - page 31 of 96 Page 129 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 31 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov IX. HAZARDS AND HAZARDOUS MATERIALS Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Create a significant hazard to the public or the environment through the routine transport, use, or disposal of hazardous materials? ☐ ☐ ☐ ☒ (b) Create a significant hazard to the public or the environment through reasonably foreseeable upset and accident conditions involving the release of hazardous materials into the environment? ☐ ☐ ☐ ☒ (c) Emit hazardous emissions or handle hazardous or acutely hazardous materials, substances, or waste within one-quarter mile of an existing or proposed school? ☐ ☐ ☐ ☒ (d) Be located on a site which is included on a list of hazardous materials sites compiled pursuant to Government Code Section 65962.5 and, as a result, would it create a significant hazard to the public or the environment? ☐ ☐ ☐ ☒ (e) For a project located within an airport land use plan or, where such a plan has not been adopted, within two miles of a public airport or public use airport, would the project result in a safety hazard or excessive noise for people residing or working in the project area? ☐ ☐ ☐ ☒ (f) Impair implementation of or physically interfere with an adopted emergency response plan or emergency evacuation plan? ☐ ☐ ☐ ☒ (g) Expose people or structures, either directly or indirectly, to a significant risk of loss, injury or death involving wildland fires? ☐ ☐ ☐ ☒ Attachment 2 - page 32 of 96 Page 130 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 32 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Setting Based on a 2021 review of the Envirostor database, there are no documented hazardous storage or release sites in the vicinity of Lopez Reservoir. The site is not in close proximity to serpentinite or ultramafic rock outcrops known to contain naturally occurring asbestos. The closest such rock formations are approximately 10 miles west of the project location. The project is within a ‘very high’ Fire Hazard Severity Zone and is in a State (California Department of Forestry and Fire Protection, CalFire) fire responsibility area. CalFire’s Airport Station is located approximately 11 miles from the project site and response time is in the range of 10 to 20 minutes. The Arroyo Grande Creek corridor downstream from Lopez Dam is a mapped dam inundation zone. Property within the inundation zone include for example, agricultural land, residential areas as well as portions of the community of Oceano and the City of Arroyo Grande. Discussion (a) Create a significant hazard to the public or the environment through the routine transport, use, or disposal of hazardous materials? (b) Create a significant hazard to the public or the environment through reasonably foreseeable upset and accident conditions involving the release of hazardous materials into the environment? (c) Emit hazardous emissions or handle hazardous or acutely hazardous materials, substances, or waste within one-quarter mile of an existing or proposed school? (d) Be located on a site which is included on a list of hazardous materials sites compiled pursuant to Government Code Section 65962.5 and, as a result, would it create a significant hazard to the public or the environment? In regard to (a) through (d), the project would not require any construction, demolition, ground disturbance, or any other activity requiring the transport, use, or disposal of any hazardous materials. (e) For a project located within an airport land use plan or, where such a plan has not been adopted, within two miles of a public airport or public use airport, would the project result in a safety hazard or excessive noise for people residing or working in the project area? Lopez Reservoir is not located in an airport review area. The San Luis Obispo airport review area is over five miles to the west, and the Oceano Airport review area is roughly 8 miles to the southwest of Lopez Reservoir. The downstream portions of Arroyo Grande Creek are in the Oceano airport review area. The project-related increases in flow in Arroyo Grande Creek would be within the range of existing flows, are separated from the Oceano Airport by the existing levees, and are not expected to result in a safety hazard for the airport. (f) Impair implementation of or physically interfere with an adopted emergency response plan or emergency evacuation plan? The project would not require any transportation-related actions, road closures, or changes in land use and would not alter or interfere with emergency response or emergency evacuation plans. Attachment 2 - page 33 of 96 Page 131 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 33 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov (g) Expose people or structures, either directly or indirectly, to a significant risk of loss, injury or death involving wildland fires? The project would not require any physical actions that would increase the risk of wildland fires, increase exposure of people or structures to wildland fires, or interfere with wildland fire response. Conclusion/Mitigation The project would not have any effects related to hazards or hazardous materials and no mitigation measures are necessary. X. HYDROLOGY AND WATER QUALITY Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Violate any water quality standards or waste discharge requirements or otherwise substantially degrade surface or ground water quality? ☐ ☐ ☐ ☒ (b) Substantially decrease groundwater supplies or interfere substantially with groundwater recharge such that the project may impede sustainable groundwater management of the basin? ☐ ☐ ☒ ☐ (c) Substantially alter the existing drainage pattern of the site or area, including through the alteration of the course of a stream or river or through the addition of impervious surfaces, in a manner which would: ☐ ☐ ☒ ☐ (i) Result in substantial erosion or siltation on- or off-site; ☐ ☐ ☒ ☐ (ii) Substantially increase the rate or amount of surface runoff in a manner which would result in flooding on- or off-site; ☐ ☐ ☒ ☐ (iii) Create or contribute runoff water which would exceed the capacity of existing or planned stormwater drainage systems or provide substantial additional sources of polluted runoff; or ☐ ☐ ☒ ☐ (iv) Impede or redirect flood flows? ☐ ☐ ☒ ☐ Attachment 2 - page 34 of 96 Page 132 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 34 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact (d) In flood hazard, tsunami, or seiche zones, risk release of pollutants due to project inundation? ☐ ☐ ☒ ☐ (e) Conflict with or obstruct implementation of a water quality control plan or sustainable groundwater management plan? ☐ ☐ ☒ ☐ Setting Water Quality Lopez Reservoir supplies freshwater to the Lopez Water Treatment Plant. The watershed is surveyed and assessed on a regular basis for potential water quality impacts. Lopez Lake is vulnerable to contamination from wastewater generation at the Lopez Lake Recreation Area and livestock near the reservoir. The Lopez Water Treatment Plant water quality is also rigorously tested before being supplied to Contractors. The treated drinking water is monitored for a wide range of naturally occurring and anthropogenic contaminants. Water monitoring results are available for review at https://www.slocounty.ca.gov/Departmen ts/Public- Works/Forms-Documents/Water-Resources/Water-Quality-Reports.aspx. The Arroyo Grande Creek below Lopez Reservoir is on the state’s federal Clean Water Act Section 303(d) list (SWRCB 2021) of impaired water bodies for Escherichia coli and fecal coliform (bacterial contaminants indicative of human and animal fecal waste). Proposed water quality impairment additions for the same reach include nickel, nitrate, toxicity, and benthic community effects. Reservoir and Surface Hydrology Lopez Reservoir has a capacity of 49,388 AF and when near capacity, a surface area of nearly 1,000 acres. Water levels can fluctuate in response to seasonal precipitation , long-term climatic conditions, and Contractor demand. Based on decades of supply and demand, the District has determined that the safe yield of the reservoir is 8,730 AFY. The “safe yield” is the maximum amount of water that can be consistently extracted from the reservoir on an annual basis without the reservoir reaching minimum pool or other limiting constraints. Currently, the safe yield represents 4,530 AFY of Contractor entitlements and 4,200 AFY of downstream releases. Downstream releases have averaged approximately 3,640 AFY for the past 10+ years from 2007 to the present. The District generally relies on post-2007 volumes as that is representative of the Lopez Project operations since a seismic retrofit of the dam was completed (2002) and the adoption of an Interim Downstream Release Schedule (IDRS) in 2007. In 2015 due to intense drought conditions, the reservoir volume dropped below 20,000 AF. The District’s Board of Supervisors, following the State’s drought declaration, declared a water emergency related to Zone 3. In response, the District implemented a Low Reservoir Response Plan (LRRP). In August 2021 the District declared a local drought emergency and enacted the LRRP. The purpose of the plan is to limit municipal and downstream releases to preserve and extend water supplies in the reservoir for a 3- to 4-year period during intense drought conditions. Attachment 2 - page 35 of 96 Page 133 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 35 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Groundwater The reservoir is not located in an identified groundwater basin. However, Arroyo Grande Creek from the dam to where the creek flows under Highway 101 overlies the Santa Maria River Valley Groundwater Basin (SMRVGB), Arroyo Grande Subbasin. Arroyo Grande Creek from Highway 101 to the coast overlies the SMRVGB Santa Maria Subbasin. The service areas of the Lopez Contractors, with the exception of portions of Pismo Beach and all of CSA-12 (Avila), overlay the SMRVGB. Arroyo Grande, Grover Beach, Oceano Community Services District and Pismo Beach are the Contractors currently relying on groundwater from the SMRVGB. The California Department of Water Resources 2019 groundwater basin categorization identified the Santa Maria and Arroyo Grande Subbasins as very low priority. Prioritization is based on, among other factors, the degree to which the groundwater serves as a primary source of water, and identified impacts such as saline intrusion or overdraft. The County is nonetheless preparing a Groundwater Sustainability Plan for the Arroyo Grande Subbasin to better understand the system and to support the HCP under development. Additionally, the communities that rely on the Santa Maria subbasin (Pismo Beach, Grover Beach, Ar royo Grande, and Oceano, referred to as the North Cities Management Area) have been monitoring conditions in order to manage their water supply. A series of five coastal area monitoring well clusters showed evidence of seawater intrusion of the basin in 2009 (Central Coast Blue 2018). In response, the local water users entered into an agreement to limit municipal groundwater pumping to reduce the threat of intrusion. Target withdrawal amounts for each user were set to limit groundwater use to roughly a quar ter of the total entitlements (GSI Water Solutions, Inc. 2021). On -going monitoring is used to track the condition of the aquifer, using the five “sentry wells” along the coast as indicators of potential intrusion. The goal is to maintain groundwater gradients (i.e., flow) from east (where municipal withdrawal wells are located) to west (the coastline) to minimize the potential for seawater intrusion. Groundwater quality monitoring is focused on indicators of seawater intrusion. Based on the State Water Quality Control Board’s GeoTracker, the project is not in or near any sites that require groundwater remediation or permitted facilities that could impact groundwater. Discussion (a) Violate any water quality standards or waste discharge requirements or otherwise substantially degrade surface or ground water quality? Project-related changes in water levels in Lopez Reservoir are not expected to result in adverse effects to surface water or groundwater quality. No construction activities, new land uses, or other changes are proposed that could introduce new sources of contaminants in the project area. Project-related changes to Lopez Reservoir water levels and downstream flows would constitute relatively minor changes compared to existing conditions and would not change existing circulation or flushing conditions to an extent that would have the potential to affect water quality. As such, the project is not expected to result in changes to the existing water quality conditions in the reservoir or downstream water, including groundwater conditions that are managed with downstream releases. (b) Substantially decrease groundwater supplies or interfere substantially with groundwater recharge such that the project may impede sustainable groundwater management of the basin? The project would not change existing downstream releases or the Contractors’ maximum annual groundwater withdrawal amounts. As such, the project would not decrease groundwater supplies or interfere with any existing groundwater management programs. The project-related increases in spill have the potential to incrementally increase groundwater recharge. Attachment 2 - page 36 of 96 Page 134 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 36 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov (c) Substantially alter the existing drainage pattern of the site or area, including through the alteration o f the course of a stream or river or through the addition of impervious surfaces, in a manner which would: (c-i) Result in substantial erosion or siltation on- or off-site? (c-ii) Substantially increase the rate or amount of surface runoff in a manner which would result in flooding on- or off-site? (c-iii) Create or contribute runoff water which would exceed the capacity of existing or planned stormwater drainage systems or provide substantial additional sources of polluted runoff? (c-iv) Impede or redirect flood flows? In regard to (c-i) through (c-iv), the project would not require construction of new facilities that could alter existing drainage patterns or increase impervious surfaces or stormwater runoff. Project -related hydrologic changes in reservoir levels and downstream flows would be within the range of existing conditions; as such, the project would not alter existing conditions regarding reservoir storage and downstream passage of flood flows. As described in the introduction section (pages 5 - 6), the effects of project-related increases on peak flow rates in Arroyo Grande Creek resulting from spill over the dam are depicted graphically for three different locations along Arroyo Grande Creek shown in Figure 3: just below Lopez Dam (modeling results in Figure 4), the AG Stream Gage near Stanley Avenue in the City of Arroyo Grande (Figure 5), and the 22nd Street bridge in Oceano (Figure 6). These locations were selected because there are flow monitoring devices that have been in use at these sites for many years. Additionally, the 22nd Street location is in the District’s Zone 1/1A managed flood control channel, which consists of levees along the lower three miles of Arroyo Grande Creek. At all three locations, project-related increases in spill are not predicted to increase the magnitude of flow in the creek during the maximum spill event. For smaller spill events, the project-related increases would be infrequent and would not approach the magnitude of the highest expected spill - or non-spill related flows in the creek. For example, at the 22nd Street location the channel capacity is 5,000 cfs, which is indicated with the dashed line in Figure 6. The figure shows that one existing spill event during the 51-year modeling period is predicted to exceed the channel capacity (i.e., has the potential to overtop the levees). All other predicted channel flows resulting from spill events, including the project-related increases (orange section of bars labeled “difference”) would be well below that magnitude and would be expected to be contained within the flood control channel. For reference, the 100-year discharge event in Arroyo Grande Creek is 19,500 cfs (SLO Watershed Project, undated). Additionally, because reservoir water levels are generally higher in winter and spring when rainfall is highest and demand is lowest, most spill events are expected to occur during this timeframe. (d) In flood hazard, tsunami, or seiche zones, risk release of pollutants due to project inundation? The project would not alter existing flood hazard zones or increase the areas of inundation associated with the reservoir or the Arroyo Grande Creek corridor. As discussed in (c), the project-related increases in spill are not expected to result in a material increase in the frequency or magnitude of flood conditions. Therefore, the project is not expected to increase the risk of flood damage or pollutant release due to flooding. Attachment 2 - page 37 of 96 Page 135 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 37 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov (e) Conflict with or obstruct implementation of a water quality control plan or sustainable groundwater management plan? The project would not change existing programs related to water quality and sustainable groundwater management, as discussed in (a) and (b). Conclusion/Mitigation The project would not affect water quality conditions in Lopez Reservoir or surface water and groundwater downstream. The project would result in periodic increases in Lopez Reservoir water levels that would be within the range of existing conditions. Because water levels and downstream releases are closely managed, the project would not result in any significant change in flood hazard conditions in the reservoir or upstream areas. The project would result in incremental increases in spill and spill volume that would be within the range of existing flow conditions in Arroyo Grande Creek downstream from the dam. Project -related effects would be minor and are not expected to result in material changes in flood conditions in the Arroyo Grande Creek corridor. No mitigation is required. XI. LAND USE AND PLANNING Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Physically divide an established community? ☐ ☐ ☐ ☒ (b) Cause a significant environmental impact due to a conflict with any land use plan, policy, or regulation adopted for the purpose of avoiding or mitigating an environmental effect? ☐ ☐ ☐ ☒ Setting Surrounding land uses for Lopez Reservoir and Arroyo Grande Creek consist of rural lands sparsely developed for recreation and residential use, and urban development in the lower portions of Arroyo Grande Creek. The project was reviewed for consistency with policy and regulatory documents relating to the environment and appropriate land use. Early consultation notice and opportunity to comment was provided either directly by the District or through the State Clearinghouse to interested agencies to review for policy consistencies (e.g., CalFire for Fire Code, APCD for Clean Air Plan; full list in Exhibit A). The project is not within or adjacent to an approved Habitat Conservation Plan area. As described in the Biological Resources section, HCPs are being developed for Arroyo Grande Creek and the State Park Oceano Dunes District Discussion (a) Physically divide an established community? The project will not physically divide an established community and will not alter existing transportation routes between communities. Attachment 2 - page 38 of 96 Page 136 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 38 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov (b) Cause a significant environmental impact due to a conflict with any land use plan, policy, or regulation adopted for the purpose of avoiding or mitigating an environmental effect? The project is compatible with the surrounding uses and would not change or interfere with any existing land uses. The South County Inland Area Plan designates private lands within the viewshed and immediate watershed of Lopez Lake as a Sensitive Resource Area for aesthetics, water quality, primitive values, and wildlife habitat. Project-related effects on these issues are as described under Aesthetics, Biological Resources, and Hydrology and Water Quality. While not applicable to work proposed by the County within existing County rights-of-way, the project does not conflict with the designation of the Lopez Lake Sensitive Resource Area in the South County Inland Area Plan. The project was found to be consistent with other applicable plans (listed in Exhibit A), and does not conflict with the plans or policies of any of the referral agencies. Habitat conditions for federally listed species and designated critical habitat in Arroyo Grande Creek downstream of the dam are being addressed in the draft Arroyo Grande HCP. Arroyo Grande Creek crosses into the State Parks Oceano Dunes Draft HCP area at the coast. Project-related effects on flow conditions in Arroyo Grande Creek would be relatively infrequent and within the existing range of flow conditions (Figures 4, 5, and 6). As such, the project is not expected to conflict with any of the management objectives of the HCPs, which pertain to federally listed species and designated critical habitat. Conclusion/Mitigation The project will have no effect on land use and planning. As described in the Biological resources section, the project would not conflict with the Arroyo Grande Creek HCP provided the contract provisions are reviewed at such time as the HCP is finalized. No mitigation measures are necessary. XII. MINERAL RESOURCES Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Result in the loss of availability of a known mineral resource that would be of value to the region and the residents of the state? ☐ ☐ ☐ ☒ (b) Result in the loss of availability of a locally- important mineral resource recovery site delineated on a local general plan, specific plan or other land use plan? ☐ ☐ ☐ ☒ Setting The project site is not located near any surface mines or energy/extractive areas. Attachment 2 - page 39 of 96 Page 137 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 39 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Discussion (a) Result in the loss of availability of a known mineral resource that would be of value to the region and the residents of the state? The project would not require any construction, ground disturbance, or transportation components that would have the potential to impact mineral resources or interfere with access to mineral resources. (b) Result in the loss of availability of a locally- important mineral resource recovery site delineated on a local general plan, specific plan or other land use plan? The project is not located within or near any delineated mineral resource recovery sites. Conclusion/Mitigation The project would not impact mineral resources and no mitigation measures are necessary. XIII. NOISE Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project result in: (a) Generation of a substantial temporary or permanent increase in ambient noise levels in the vicinity of the project in excess of standards established in the local general plan or noise ordinance, or applicable standards of other agencies? ☐ ☐ ☐ ☒ (b) Generation of excessive groundborne vibration or groundborne noise levels? ☐ ☐ ☐ ☒ (c) For a project located within the vicinity of a private airstrip or an airport land use plan or, where such a plan has not been adopted, within two miles of a public airport or public use airport, would the project expose people residing or working in the project area to excessive noise levels? ☐ ☐ ☐ ☒ Setting Sensitive receptors in the vicinity of the project area include residences and recreational users at Lopez Reservoir, and residences and schools in urban developed areas bordering Arroyo Grande Creek downstream of the dam. Arroyo Grande Creek and the flood control levees border the south side of the Oceano County Airport parcel. Attachment 2 - page 40 of 96 Page 138 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 40 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Discussion (a) Generation of a substantial temporary or permanent increase in ambient noise levels in the vicinity o f the project in excess of standards established in the local general plan or noise ordinance, or applicable standards of other agencies? The project would not require construction or transportation activities and would not alter the type of activities conducted to manage water levels at Lopez Dam. As such the project would not affect ambient noise levels. (b) Exposure of persons to or generation of excessive groundborne vibration or groundborne noise levels? The project would not require construction or any other activity that would generate excessive groundborne vibration or noise. (c) For a project located within the vicinity of a private airstrip or an airport land use plan or, where such a plan has not been adopted, within two miles of a public airport or public use airport, would the project expose people residing or working in the project area to excessive noise levels? The project is not located in the vicinity of a private airstrip. The project would not include construction activities or any operational changes that would generate noise. Conclusion/Mitigation The project would not result in any change in ambient noise levels and no mitigation measures are necessary. XIV. POPULATION AND HOUSING Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Induce substantial unplanned population growth in an area, either directly (for example, by proposing new homes and businesses) or indirectly (for example, through extension of roads or other infrastructure)? ☐ ☐ ☒ ☐ (b) Displace substantial numbers of existing people or housing, necessitating the construction of replacement housing elsewhere? ☐ ☐ ☐ ☒ Setting The Lopez Reservoir is located in a rural area of unincorporated San Luis Obispo County. There are only widely scattered residences located in the vicinity, and surrounding land uses are primarily recreational lands and open space. Attachment 2 - page 41 of 96 Page 139 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 41 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Arroyo Grande Creek downstream of the dam passes through rural agricultural and residential land and the urban center of the City of Arroyo Grande. Water from the Lopez project is used throughout the South County in the cities of Pismo Beach, Arroyo Grande, and Grover Beach, as well as the communities of Oceano and Avila Beach. Discussion (a) Induce substantial unplanned population growth in an area, either directly (for example, by proposing new homes and businesses) or indirectly (for example, through extension of roads or other infrastructur e)? Lopez Project entitlements range from 245 to 2,290 AFY for the five Contractors; the project would not change these entitlements. The project would also not change any Contractor ’s allocation of SWP water. Instead, the project would provide greater flexibility for the Contractors, specifically during years when water availability from Lopez and/or the SWP is below average. The project would not increase the volume of water in each Contractor’s portfolio; therefore, the project would not represent a “new ” source of water with the potential for inducing growth. The project would not include any new infrastructure that would support increased service areas for any of the Contractors and therefore would not induce population growth. (b) Displace substantial numbers of existing people or housing, necessitating the construction of replacement housing elsewhere? The project would not require any new construction and would not displace any housing. Conclusion/Mitigation The project would have no impacts on population and housing and no mitigation measures are necessary. XV. PUBLIC SERVICES Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact (a) Would the project result in substantial adverse physical impacts associated with the provision of new or physically altered governmental facilities, need for new or physically altered governmental facilities, the construction of which could cause significant environmental impacts, in order to maintain acceptable service ratios, response times or other performance objectives for any of the public services: ☐ ☐ ☐ ☒ Fire protection? ☐ ☐ ☐ ☒ Police protection? ☐ ☐ ☐ ☒ Attachment 2 - page 42 of 96 Page 140 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 42 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Schools? ☐ ☐ ☐ ☒ Parks? ☐ ☐ ☐ ☒ Other public facilities? ☐ ☐ ☐ ☒ Setting Police protection in the project area is provided by the County Sheriff Department. The project is located in a “very high” Fire Hazard Severity Zone (SLO County 2007); however, Cal Fire’s Airport Fire Station is located approximately 11 miles from the project site and response time is approximately 20 minutes. The closest schools are in Arroyo Grande. The project area is an integral component of the Lopez Recreation Area. Discussion (a) Would the project result in substantial adverse physical impacts associated with the provision of new or physically altered governmental facilities, need for new or physically altered governmental facilities, the construction of which could cause significant environmental impacts, in order to maintain acceptable service ratios, response times or other performance objectives for any of the public services: fire protection, police protection, schools, parks, or other public facilities? The proposed project would have no effect on police, fire, schools, or other public services and would not result in the need for new services or facilities. Impacts to Lopez Recreation Area, a County Park, are discussed under Recreation. No new structures would be built, and there would be no increase in population or traffic as a result of the project. Therefore, there would be no effects on fire, police, or emergency response. The public benefits of the Lopez Project, including providing a source of drinking water , and managing downstream releases for public benefits (habitat, agriculture, and groundwater recharge) would not be adversely affected by the project. Conclusion/Mitigation The project is not expected to adversely affect public services and no mitigation is required. Attachment 2 - page 43 of 96 Page 141 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 43 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov XVI. RECREATION Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact (a) Would the project increase the use of existing neighborhood and regional parks or other recreational facilities such that substantial physical deterioration of the facility would occur or be accelerated? ☐ ☐ ☐ ☒ (b) Does the project include recreational facilities or require the construction or expansion of recreational facilities which might have an adverse physical effect on the environment? ☐ ☐ ☒ ☐ Setting The Lopez Lake Recreation Area is 200 acres of parkland and an associated 4,076 acres of Natural Area publicly owned and operated by the San Luis Obispo County Department of Parks and Recreation (County Parks). The park lands include Lopez Reservoir and the surround parcels. Lopez Lake Recreation Area provides active and passive recreational opportunities associated with the Lopez Lake Reservoir. Recreational amenities include camping, boating, water skiing, water slide, fishing, swimming, trails, and natur e appreciation. Discussion (a) Would the project increase the use of existing neighborhood and regional parks or other recreational facilities such that substantial physical deterioration of the facility would occur or be accelerated? The project would have no effect on the amount or type of use of the Lopez Lake Recreation Area. (b) Does the project include recreational facilities or require the construction or expansion of recreational facilities which might have an adverse physical effect on the environment? The project would not require construction or expansion of recreational facilities. Modeling results indicate the project would potentially result in incrementally higher water levels in Lopez Reservoir. Any such change would not adversely affect recreational use of the lake. Conclusion/Mitigation The project would not have adverse effects on recreation and no mitigation measures are necessary. Attachment 2 - page 44 of 96 Page 142 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 44 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov XVII. TRANSPORTATION Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Conflict with a program plan, ordinance or policy addressing the circulation system, including transit, roadway, bicycle and pedestrian facilities? ☐ ☐ ☐ ☒ (b) Would the project conflict or be inconsistent with CEQA Guidelines section 15064.3, subdivision (b)? ☐ ☐ ☐ ☒ (c) Substantially increase hazards due to a geometric design feature (e.g., sharp curves or dangerous intersections) or incompatible uses (e.g., farm equipment)? ☐ ☐ ☐ ☒ (d) Result in inadequate emergency access? ☐ ☐ ☐ ☒ Setting As described in the December 2018 Technical Advisory on Evaluating Transportation Impacts in CEQA, vehicle miles traveled (VMT) is considered the most appropriate metric to evaluate a project’s transportation impacts under CEQA, replacing level of service and other similar metrics for consideration of significant environmental effects. The main road in the project area is Lopez Drive, which is a two-lane County road providing access to the Lopez Lake Recreation Area and rural residential roads. Discussion (a) Conflict with a program plan, ordinance or policy addressing the circulation system, including transit, roadway, bicycle and pedestrian facilities? The project would not require construction of any kind and would not alter or affect existing transportation networks or conditions. Therefore, the project would not conflict with any transit plans, ordinances, or policies. (b) Would the project conflict or be inconsistent with CEQA Guidelines section 15064.3, subdivision (b)? Section 15064.3(b)(2) of the CEQA Guidelines states that transportation projects that reduce, or have no impact on, vehicle miles traveled should be presumed to cause a less than significant impact on transportation. The project would not involve any activities that would alter existing transportation conditions and would have no effect on vehicle miles traveled. Therefore, the project will be consistent with Section 15064.3. Attachment 2 - page 45 of 96 Page 143 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 45 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov (c) Substantially increase hazards due to a geometric design feature (e.g., sharp curves or dangerous intersections) or incompatible uses (e.g., farm equipment)? The project would not change the existing road configuration or introduce new traffic uses. (d) Result in inadequate emergency access? The project would not change the existing road configuration or introduce new traffic uses and so would not have any effect on existing emergency access conditions. Conclusion/Mitigation Implementation of the project would not result in any impacts on transportation, and no mitigation measures are necessary. XVIII. TRIBAL CULTURAL RESOURCES Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact (a) Would the project cause a substantial adverse change in the significance of a tribal cultural resource, defined in Public Resources Code section 21074 as either a site, feature, place, cultural landscape that is geographically defined in terms of the size and scope of the landscape, sacred place, or object with cultural value to a California Native American tribe, and that is: (i) Listed or eligible for listing in the California Register of Historical Resources, or in a local register of historical resources as defined in Public Resources Code section 5020.1(k), or ☐ ☐ ☐ ☒ (ii) A resource determined by the lead agency, in its discretion and supported by substantial evidence, to be significant pursuant to criteria set forth in subdivision (c) of Public Resources Code Section 5024.1. In applying the criteria set forth in subdivision (c) of Public Resource Code Section 5024.1, the lead agency shall consider the significance of the resource to a California Native American tribe. ☐ ☐ ☐ ☒ Attachment 2 - page 46 of 96 Page 144 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 46 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Setting In accordance with AB 52 consultation requirements, outreach to seven Native American tribe groups was conducted on February 22, 2021 (Northern Chumash Tribal Council, Salinan Tribe of San Luis Obispo, Monterey and San Benito Counties, yak titÿu titÿu yak tiłhini – Northern Chumash Tribe, Xolon Salinan Tribe, Barbareno/Ventureno Band of Mission Indians (three tribal members), Santa Ynez Band of Chumash Indians, and the Coastal Band of the Chumash Nation. Responses were received from three tribal representatives (yak titÿu titÿu yak tiłhini – Northern Chumash Tribe; the Salinan Tribe of San Luis Obispo, Monterey, and San Benito Counties; and the Santa Ynez Band of Chumash Indians) stating that there is potential for archaeological sensitivity in the region, but that they have no concerns with the project based on the fact that no physical disturbance, ground disturbance, or construction activities would occur. Discussion (a) Would the project cause a substantial adverse change in the significance of a tribal cultural resource, defined in Public Resources Code section 21074 as either a site, feature, place, cultural landscape that is geographically defined in terms of the size and scope of the landscape, sacred place, or object with cultural value to a California Native American tribe, and that is: (a-i) Listed or eligible for listing in the California Register of Historical Resources, or in a local register of historical resources as defined in Public Resources Code section 5020.1(k)? (a-ii) A resource determined by the lead agency, in its discretion and supported by substantial evidence, to be significant pursuant to criteria set forth in subdivision (c) of Public Resources Code Section 5024.1. In applying the criteria set forth in subdivision (c) of Public Resources Code Section 5024.1, the lead agency shall consider the significance of the resource to a California Native American tribe. As described in the Cultural Resources section, no archaeological resources have been identified in the project area. The project would not require any ground disturbance. Any changes in hydrology that result from the project would be within the existing ranges of water level in Lopez Reservoir and flow conditions in Arroyo Grande Creek. This means that the project would not introduce the potential for inundation or flooding of areas that are not already subject to inundation. Conclusion/Mitigation The project would not affect cultural resources and no mitigation measures are necessary. Attachment 2 - page 47 of 96 Page 145 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 47 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov XIX. UTILITIES AND SERVICE SYSTEMS Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact Would the project: (a) Require or result in the relocation or construction of new or expanded water, wastewater treatment or storm water drainage, electric power, natural gas, or telecommunications facilities, the construction or relocation of which could cause significant environmental effects? ☐ ☐ ☐ ☒ (b) Have sufficient water supplies available to serve the project and reasonably foreseeable future development during normal, dry and multiple dry years? ☐ ☐ ☒ ☐ (c) Result in a determination by the wastewater treatment provider which serves or may serve the project that it has adequate capacity to serve the project’s projected demand in addition to the provider’s existing commitments? ☐ ☐ ☐ ☒ (d) Generate solid waste in excess of State or local standards, or in excess of the capacity of local infrastructure, or otherwise impair the attainment of solid waste reduction goals? ☐ ☐ ☐ ☒ (e) Comply with federal, state, and local management and reduction statutes and regulations related to solid waste? ☐ ☐ ☐ ☒ Setting The District established Zone 3 (Zone 3) on July 26, 1965, for the purpose of financing, construction and maintenance of the Lopez Dam and facilities (Lopez Project) to provide potable water to the lands within the Zone 3 boundaries. The District entered into water supply contracts with the Zone 3 Contractors to fund a portion of the Lopez Project and to establish entitlements for Lopez Water. The Lopez Project includes the reservoir, dam, terminal reservoir, water treatment plant, and the Lopez Pipeline that transmits the treated water to the Contractors. The terminal reservoir serves as a holding basin prior to intake at the water treatment plant. Each Contractor owns and operates their own distribution facilities, as well as infrastructure for other water supply sources in their portfolio. Attachment 2 - page 48 of 96 Page 146 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 48 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Wastewater and solid waste are not a component of the Lopez Project and are managed by each Contractor with their own infrastructure. Discussion (a) Require or result in the construction of new water or wastewater treatment facilities or expansion of existing facilities, the construction of which could cause significant environmental effects? The project would not require the construction of new water or wastewater facilities or expansion of existing facilities. (b) Have sufficient water supplies available to serve the project and reasonably foreseeable future development during normal, dry and multiple dry years? The project is being proposed to increase the resiliency of Lopez Project water, including management options to help alleviate water supply shortages during dry years . The project would allow Contractors to manage their use of Lopez Water in the most beneficial way given conditions with other water supplies in their portfolio. The project is expected to increase potential use of SWP water by the Contractors, and to take the pressure off any one source they use to fulfill customer demand. This should allow the Contractors to better plan and prepare for unanticipated water supply emergencies or drought conditions. The project is expected to result in higher water levels in Lopez Reservoir on average, and to reduce the occurrence of low-water conditions that have the potential to trigger water use restrictions. The modeling predicts incremental increases in the occurrence of spill and in evaporation loss from Lopez Reservoir as a result of higher water levels. However, the project-related increase in evaporative loss is not substantial (approximately 2%), and it is anticipated that the Contractors would manage use of their water supplies to reduce loss due to spill. In any given year, Contractors of SWP water are subject to frequent spills (almost yearly at times) at San Luis Reservoir, often regardless of climatological conditions because of the inability to move and store that water elsewhere in the system. Through analysis of historic SWP operations, it was determined that approximately 7,000 AFY of District water has spilled or been lost at San Luis Reservoir on average over the last 26 years. The project will provide additional opportunities for District and SWP subcontra ctors to store more SWP in Lopez Reservoir through in-lieu exchanges with Lopez water that would reduce the amount of SWP spills/losses that occur at San Luis Reservoir. While not specifically modeled, this should offset some of the anticipated project- related increase in spill at Lopez Reservoir. The proposed project would not preclude the District from revisiting any aspect of the Lopez Project water management and contracts with the Contractors to respond to changing conditions. For example, the proposed contract changes would be revisited when the Arroyo Grande Creek HCP is finalized to determine if any changes are required to ensure compliance with the HCP. (c) Result in a determination by the wastewater treatment provider which serves or may serve the project that it has adequate capacity to serve the project’s projected demand in addition to the provider’s existing commitments? The project would not require wastewater treatment or affect existing wastewater treatment facilities. (d) Generate solid waste in excess of State or local standards , or in excess of the capacity of local infrastructure, or otherwise impair the attainment of solid waste reduction goals? The project would not generate solid waste or affect existing solid waste disposal facilities. Attachment 2 - page 49 of 96 Page 147 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 49 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov (e) Comply with federal, state, and local management and reduction statutes and regulations related to solid waste? See response to (d). Conclusion/Mitigation The project would have beneficial effects for the Lopez Contractors by enabling flexible management of available water supplies. This would benefit the District in regard to managing County-wide water supply resources (e.g., groundwater), and has the potential to reduce drought-related limitations on water use, which would benefit all Contractor customers. The project would not decrease available water supply or increase demand. Project-related increases in spill and evaporation from Lopez Reservoir have the potential to decrease water available for water supply. However, based on the estimated quantities of those water losses, and anticipated Contractor incentives expected to reduce the losses compared to the modeled levels over a 51-year period, no significant effects on water supply would result. The project will have no significant adverse effects on water or wastewater and no mitigation measures are necessary. XX. WILDFIRE Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact If located in or near state responsibility areas or lands classified as very high fire hazard severity zones, would the project: (a) Substantially impair an adopted emergency response plan or emergency evacuation plan? ☐ ☐ ☐ ☒ (b) Due to slope, prevailing winds, and other factors, exacerbate wildfire risks, and thereby expose project occupants to, pollutant concentrations from a wildfire or the uncontrolled spread of a wildfire? ☐ ☐ ☐ ☒ (c) Require the installation or maintenance of associated infrastructure (such as roads, fuel breaks, emergency water sources, power lines or other utilities) that may exacerbate fire risk or that may result in temporary or ongoing impacts to the environment? ☐ ☐ ☐ ☒ (d) Expose people or structures to significant risks, including downslope or downstream flooding or landslides, as a result of runoff, post-fire slope instability, or drainage changes? ☐ ☐ ☐ ☒ Attachment 2 - page 50 of 96 Page 148 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 50 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Setting As described under Hazards and Hazardous Materials, the Lopez Reservoir is located in a “very high” fire severity zone and the response time for the area is approximately 20 minutes. Discussion (a) Substantially impair an adopted emergency response plan or emergency evacuation plan? (b) Due to slope, prevailing winds, and other factors, exacerbate wildfire risks, and thereby expose project occupants to, pollutant concentrations from a wildfire or the uncontrolled spread of a wildfire? (c) Require the installation or maintenance of associated infrastructure (such as roads, fuel breaks, emergency water sources, power lines or other utilities) that may exacerbate fire risk or that may result in temporary or ongoing impacts to the environment? (d) Expose people or structures to significant risks, including downslope or downstream flooding or landslides, as a result of runoff, post-fire slope instability, or drainage changes? In regard to (a) through (d), impacts of the project on emergency response are discusse d under Hazards and Hazardous Materials, Public Services, and Transportation. The project would have no impacts on existing roads or land uses and would have no material affect on any factor related to the occurrence of, or risks posed by, wildfires. Conclusion/Mitigation The project would have no effects on wildfire risk and no mitigation measures are necessary. XXI. MANDATORY FINDINGS OF SIGNIFICANCE Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact (a) Does the project have the potential to substantially degrade the quality of the environment, substantially reduce the habitat of a fish or wildlife species, cause a fish or wildlife population to drop below self-sustaining levels, threaten to eliminate a plant or animal community, substantially reduce the number or restrict the range of a rare or endangered plant or animal or eliminate important examples of the major periods of California history or prehistory? ☐ ☐ ☒ ☐ Attachment 2 - page 51 of 96 Page 149 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 51 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Potentially Significant Impact Less Than Significant with Mitigation Incorporated Less Than Significant Impact No Impact (b) Does the project have impacts that are individually limited, but cumulatively considerable? (“Cumulatively considerable” means that the incremental effects of a project are considerable when viewed in connection with the effects of past projects, the effects of other current projects, and the effects of probable future projects)? ☐ ☐ ☒ ☐ (c) Does the project have environmental effects which will cause substantial adverse effects on human beings, either directly or indirectly? ☐ ☐ ☒ ☐ Setting The project setting is described in terms of surrounding land uses on pages one through five of the Initial Study and from the perspective of environmental resources in each resource section of this document, including, for example, aesthetics, biological resources, and cultural resources. Discussion (a) Does the project have the potential to substantially degrade the quality of the environment, substantially reduce the habitat of a fish or wildlife species, cause a fish or wildlife population to drop below self - sustaining levels, threaten to eliminate a plant or animal community, substantially reduce the number or restrict the range of a rare or endangered plant or animal or eliminate important examples of the major periods of California history or prehistory? No project-related effects have been identified that have the potential to substantially degrade the quality of the environment, reduce wildlife habitat, or threaten natural communities. As described under Biological Resources, the District is in the process of developing a Habitat Conservation Plan (HCP) for the purpose of protecting and enhancing habitat conditions in Arroyo Grande Creek for federally listed species. The HCP will address the operation of Lopez Dam (for example, storage and downstream release scenarios) and may have direct bearing on Lopez Water Project contracts, including the proposed contract changes . Pursuant to stipulations in the contracts, the proposed contract changes would be revisited at such time as the HCP is finalized to determine if modifications are necessary to ensure compliance with the HCP and potential for significant adverse effects on biological resources. The project is not expected to adversely affect cultural resources or to eliminate important examples of the major periods of California history or pre-history. No mitigation measures are required. Attachment 2 - page 52 of 96 Page 150 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 52 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov (b) Does the project have impacts that are individually limited, but cumulatively considerable? (“Cumulatively considerable” means that the incremental effects of a project are considerable when viewed in connection with the effects of past projects, the effects of other current projects, and the effects of probable future projects)? The project does not propose new or different uses than the existing uses of Lopez Reservoir for water supply. The project would use the existing water supply management, treatment, and distribution infrastructure and no construction or new facilities would be required. Operational impacts would be limited to changes in Lopez Reservoir storage with potential for incremental changes in the frequency and duration of reservoir high water levels and incremental increases in downstream flow conditions due to additional spill events. Existing management protocols regarding low water conditions in the reservoir, and management of dam releases for habitat conditions, agricultural irrigation, and groundwater recharge would not change as a result of the project. Contracts would be reviewed for consistency with the Arroyo Grande Creek HCP when it is finalized to ensure no adverse downstream effects to listed species or designated critical habitat occur. As such, t he project is not expected to have impacts that will be individually limited, but cumulatively considerable. Th erefore, project impacts, when considered together with past, on-going, and future projects in the vicinity, would not be cumulatively considerable and would not compound or increase other environmental impacts. Therefore, all project-related impacts will be less than significant. (c) Does the project have environmental effects which will cause substantial adverse effects on human beings, either directly or indirectly? The project would not result in environmental effects that would cause substantial adverse effects on human beings, either directly or indirectly. The proposed contract changes would increase water supply resiliency for the Contractors, increasing their portfolio management options for providing a safe and reliable source of drinking water to their customers and increasing potential use of existing State Water allocations within the District. Increased water levels in Lopez Reservoir are expected to reduce the likelihood of low-water restrictions during droughts. Collectively, these changes would benefit the District and the Contractors by reducing the pressure on any one water supply source. Collectively these changes would benefit Contractor customers by reducing the potential for drought-related restrictions on water use and potentially reducing water costs. Effects of increased water storage in Lopez Reservoir is expected to have a beneficial effect on recreational use of Lopez Recreation Area. Potential for increased water losses through increased evaporation from the reservoir and spill over the dam would be minor in scale and would not contribute to substantial adverse water supply effects. The potential for increased spill would result in periodic, incremental increases in Arroyo Grande Creek flow that would not cause substantial adverse effects from erosion or flooding conditions. The project would not conflict with adjacent land uses, pose any hazards, or interfere with public safety or emergency response procedures. Implementation of the project would result in net benefits to public water supply. Therefore, the project is not expected to have adverse effects, and is expected to have some beneficial effects, on human beings. Conclusion/Mitigation The project will have a less than significant impact on the environment. No mitigation measures are required. Attachment 2 - page 53 of 96 Page 151 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 53 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Exhibit A - Initial Study References and Agency Contacts The County Public Works Department has contacted various agencies for their comments on the proposed project. With respect to the subject application, the following have been contacted for early consultation (marked with an ) and when a response was made, it is either attached or in the application file: Lopez Water Contract Changes NOI Contact List Company/Agency/Department Notified by District Response in File Nature of Response San Luis Obispo County Air Pollution Control District Yes No comments. San Luis Obispo County Parks & Recreation Yes Provide standard requirements. San Luis Obispo County Environmental Health Department None Received NA San Luis Obispo County Agricultural Commissioner None Received NA Avila Valley Advisory Council None Received NA Oceano Advisory Council None Received NA California Department of Fish and Wildlife None Received NA California State Parks None Received NA US Environmental Protection Agency None Received NA National Marine Fisheries Service Yes US Army Corps of Engineers None Received NA US Fish and Wildlife Service None Received NA Avila Beach Community Services District None Received NA Oceano Community Services District Yes Provided contact information; no comments. City of Arroyo Grande Community Development None Received NA City of Grover Beach None Received NA City of Pismo Beach Yes Provided contact information; no comments. San Luis Obispo County Agricultural Task Force None Received NA Creek Lands Conservation None Received NA South County Sanitation District None Received NA Notified through State Clearinghouse NOC None Received NA California Air Resources Board None Received NA California Coastal Commission None Received NA California Department of State Parks, Division of Boating and Waterways None Received NA California Department of Transportation District 5 None Received NA California Department of Conservation None Received NA California Department of Food and Agriculture None Received NA California Department of Forestry and Fire Protection None Received NA California Department of Water Resources None Received NA California Highway Patrol None Received NA California Natural Resources Agency None Received NA California Public Utilities Commission None Received NA California State Lands Commission None Received NA Department of Toxic Substances Control None Received NA Office of Emergency Services None Received NA Native American Heritage Commission None Received NA State Office of Historic Preservation None Received NA Attachment 2 - page 54 of 96 Page 152 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 54 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov California Department of Parks and Recreation None Received NA State Water Resources Control Board – Water Quality, Drinking Water, Water Rights, and Financial Assistance Divisions None Received NA California Department of Water Resources None Received NA ** “No comment” or “No concerns”-type responses are usually not attached The following checked (“”) reference materials have been used in the environmental review for the proposed project and are hereby incorporated by refere nce into the Initial Study. The following information is available at the County Public Works Department. Project File for the Subject Application County Documents Coastal Plan Policies Framework for Planning (Coastal/Inland) General Plan (Inland/Coastal), includes all maps/elements; more pertinent elements: Design Plan Specific Plan Annual Resource Summary Report Circulation Study Other Documents Clean Air Plan/APCD Handbook Regional Transportation Plan Uniform Fire Code Water Quality Control Plan (Central Coast Basin – Region 3) Archaeological Resources Map Area of Critical Concerns Map Special Biological Importance Map CA Natural Species Diversity Database Fire Hazard Severity Map Flood Hazard Maps Natural Resources Conservation Service Soil Survey for SLO County GIS mapping layers (e.g., habitat, streams, contours, etc.) Other Agriculture Element Conservation & Open Space Element Economic Element Housing Element Noise Element Parks & Recreation Element/Project List Safety Element Land Use Ordinance (Inland/Coastal) Building and Construction Ordinance Public Facilities Fee Ordinance Real Property Division Ordinance Affordable Housing Fund Airport Land Use Plan Energy Wise Plan Select Planning Area ~ □ □ □ □ □ □ □ ~ □ □ □ □ □ ~ □ □ ~ □ □ □ ~ ~ ~ □ ~ □ ~ □ ~ □ □ ~ □ □ □ Attachment 2 - page 55 of 96 Page 153 of 512 Project Number Project Name PLN-2039 04/2019 Initial Study – Environmental Checklist 976 OSOS STREET, ROOM 206 | SAN LUIS OBISPO, CA 93408 |(805) 781-5252 | TTY/TRS 7-1-1 PAGE 55 OF 55 publicworks@co.slo.ca.us | www.slocounty.ca.gov Additional References: The following project-specific information and/or reference materials have been considered as a part of the Initial Study: California Office of Historic Preservation. 2021. California Historical Resources. Online search for sites in San Luis Obispo County conducted April 14, 2021, at https://ohp.parks.ca.gov/listedresources/. California State Parks. 2020. Oceano Dunes District Draft Habitat Conservation Plan, draft dated November 2020 and related documents available at: https://www.oceanoduneshcp.com/document-library. California Water Commission. 2021. Climate change projections for Water Storage Investment Program (WSIP). Technical Reference and Model Components accessible online at https://data.ca.gov/dataset/climate-change-projections-for-water-storage-investment-program-wsip. Central Coast Blue. 2018. http://centralcoastblue.com/. County of San Luis Obispo Flood Control and Water Conservation District. 2007. Interim Downstream Release Schedule. Zone 3, Lopez Project, February. GSI Water Solutions, Inc. 2021. Northern Cities Management Area 2020 Annual Monitoring Report. Prepared for City of Arroyo Grande, City of Grover Beach, Oceano Community Services District, and City of Pismo Beach. April. SLO Watershed Project, undated. Arroyo Grande Creek Description, with excerpt from the Arroyo Grande Creek Watershed Management Plan. A project of the Upper Salinas-Las Tablas Resource Conservation District. Accessed online at http://slowatershedproject.org/watersheds/arroyo-grande-creek/ on January 4, 2021. State Water Resources Control Board. 2021. California 303(d) List Approved by the U.S. Environmental Protection Agency April 6, 2018. Accessed online at https://www.waterboards.ca.gov/water_issues/programs/tmdl/integrated2014_2016.shtml on January 4, 2021. SWCA. 2019. Natural Environment Study, Lopez Drive Bridge Seismic Retrofit Project, Lopez Drive, Arroyo Grande, San Luis Obispo County. Prepared for California Department of Transportation and County of San Luis Obispo Department of Public Works. May. SWCA. 2018. Lopez Drive Bridge Seismic Retrofit Project Archaeological Survey Report. Prepared for California Department of Transportation and County of San Luis Obispo Public Works Department. January. Western Hydrologics. 2021. Zone 3 Contract Change Modeling Results, San Luis Obispo County Flood Control and Water Conservation District. November. [Attachment A] Attachment 2 - page 56 of 96 Page 154 of 512 Zone 3 Contract Change Modeling Results San Luis Obispo County Flood Control and Water Conservation District November 24, 2021 Prepared under the responsible charge of Jeffery K. Meyer Jared C. Emery C 54387 C 81467 610 Auburn Ravine Road, Suite C, Auburn, CA 95603 WESTERN HYDROLOGICS WATER & HYDROPOWER CONSULTING Attachment 2 - page 57 of 96 Page 155 of 512 2 Western Hydrologics performed modeling at the request of the Zone 3 Contractors to investigate outcomes of proposed Zone 3 Contract Changes (the Project) under various scenarios. The Project provides opportunities for the Contractors to store both Lopez water and State Water Project water (SWP) year over year. The modeling scenarios are listed in Table 1. Scenarios B, C, E, and F represent modeling of the Project. The modeling was broken down into either Maximize Lopez Storage or Maximize SWP Storage to provide bookends of how the Project affects Contractors proposed storage accounts. The intent of the modeling is to evaluate the following: 1. Improved Water Management Opportunities: Opportunities for Zone 3 Agencies to store Lopez and store SWP water thru the Agency Initiated Exchanges provisions of the proposed Contract Changes (the Project) and supply prioritization to improve local water supply availability during drought conditions, while limiting losses from spills during wet periods. 2. Climate Change: Evaluation of potential impact of climate change on Lopez Reservoir inflow, evaporation, and other conditions. These Climate Change hydrology planning scenarios are required to support the California Environmental Quality Act (CEQA) impact analyses. 1.0 Assumptions A detailed description of the model scenario assumptions is provided in Table 1. Table 1 - Scenario Summary Scenario Scenario Parameters Hydrology Downstream Releases Municipal Demands Supply Priority2 Storage Rights Low Reservoir Response Plan A -Baseline 1969 -2020 IDRS Release Schedule 2035 Demands No Storage (Lopez, SWP, Groundwater) No Not Included B – Project: Maximize Lopez Storage 1969-2020 IDRS Release Schedule 2035 Demands With Storage (SWP, Groundwater, Lopez) Unreleased Downstream Releases, Unused Entitlements Not Included C – Project: Maximize SWP Storage 1969 -2020 IDRS Release Schedule 2035 Demands With Storage (Lopez, Groundwater, SWP) Unreleased Downstream Releases, SWP Exchange, Unused Entitlements Not Included D - Climate Change Baseline Climate Change 1969 -2020 IDRS Release Schedule 2035 Demands No Storage (Lopez, SWP, Groundwater) No Not Included E - Climate Change Project: Maximize Lopez Storage Climate Change 1969 -2020 IDRS Release Schedule 2035 Demands With Storage (SWP, Groundwater, Lopez) Unreleased Downstream Releases, Unused Entitlements Not Included F - Climate Change Project: Maximize SWP Storage Climate Change 1969 -2020 IDRS Release Schedule 2035 Demands With Storage (Lopez, Groundwater, SWP) Unreleased Downstream Releases, SWP Exchange, Unused Entitlements Not Included Attachment 2 - page 58 of 96 Page 156 of 512 3 1.1 Priorities: The available water sources are used in the following order to meet demands: Baseline Scenarios (A,D): 1. Lopez Entitlement water. 2. Imported SWP water 3. Groundwater Entitlement limited to 1,080 AF per year to ensure no seawater intrusion. Maximize Lopez Storage Scenario (B,E): 1. Imported SWP water 2. Groundwater Entitlement limited to 1,080 AF per year to ensure no seawater intrusion. 3. Lopez Entitlement water. 4. Stored Lopez water Maximize SWP Storage Scenarios (C,F): 1. Lopez Entitlement water 2. Groundwater Entitlement limited to 1,080 AF per year to ensure no seawater intrusion. 3. Imported SWP water 4. Stored Lopez water 5. Stored SWP imports are not to be used for downstream releases. 1.2 Consumptive Demands and Supplies: Consumptive Demand The model used projected 2035 consumptive demand estimates based on an evaluation of anticipated future demand for the Zone 3 Agencies. The 2035 demand estimates were developed by dividing 2018 water demands by the estimated 2018 populations to develop gallons per capita per day (gpcd) demand factors for each agency. 2018 demands were utilized because they incorporated demand reduction behaviors adopted by Zone 3 Contractor customers during the historic drought from 2011 to 2017. These demand factors were then applied to the estimated populations for 2035 obtained from the Zone 3 Contractors 2015 UWMPs, where available, and input from OCSD staff. The 2015 UWMP estimates for 2035 water usage were not used because they did not include recent trends in demand reduction. 2020 UWMP data was not available at the time the model was developed. Actual demands will vary based on customer demand behaviors, climatic conditions, and socio-economic and other factors. Table 2 – Projected 2035 Water Demands – All Scenarios Water User Annual Consumptive Demand Pismo Beach 1,888 City of Arroyo Grande 2,510 City of Grover Beach 1,330 Oceano CSD 1,016 CSA 12 245 Total 6,989 Attachment 2 - page 59 of 96 Page 157 of 512 4 Lopez Lake Supply Safe yield of the reservoir is 8,730 AFY: 4,530 AFY for pipeline deliveries, and 4,200 AFY for downstream releases.1 Entitlement for pipeline deliveries are outlined in Table 3.2 Table 3 - Lopez Lake Treated Water Entitlement Water User Entitlement (AFY) Pismo Beach 892 Oceano CSD 303 Grover Beach 800 Arroyo Grande 2,290 CSA 12 245 Total 4,530 State Water Project Supply Water Service Amounts (WSA) for SWP delivery at the Lopez SWP turnout are 2392 AF, outlined in Table 4.3 Table 4 - SWP Lopez Turnout Water Service Amount Sub-Contractor WSA1 Drought Buffer2 Pismo Beach 1,240 1,240 Oceano CSD 750 750 San Miguelito MWC3 275 275 Avila Beach CSD4 100 100 Avila Valley MWC4 20 20 San Luis Coastal USD4 7 7 Notes: 1. This is the maximum amount of SWP water available to the agency 2. Drought buffer provides a level of insurance that an agency will receive its maximum amount in any one year 3. The Project will not affect this agency because they are not a Zone 3 Contractor 4. Subcontractor of CSA 12’s entitlement of Lopez water State Water Project allocations are taken from the DWR 2013 State Water Project Delivery Reliability Report’s existing demand level Calsim runs for 1968-2003, and historical allocations are used for 2004- 2020. Santa Maria Groundwater Basin Extraction The Northern Cities Management Areas (NCMA) Agencies (Cities of Arroyo Grande, Grover Beach, Pismo Beach and the Oceano Community Services District) have an agreement for groundwater management, associated with the Santa Maria Groundwater Basin Adjudication (2002 Management Agreement) that establishes groundwater entitlements for the NCMA Agencies, which are shown in Table 5. However, groundwater modeling, completed as part of the Central Coast Blue Phase 1B Hydrogeologic Evaluation has indicated that pumping the full NCMA Agency Entitlements (4,330 AFY) during periods of extended drought could increase the risk of seawater intrusion. To respond to this threat, the NCMA Agencies have voluntarily limited their groundwater pumping to an amount of approximately 1,080 AF per year to prevent seawater intrusion. For the purposes of the Zone 3 Contract Change Modeling, the target of 1 SLO Master Water Report, section 2.2.8. 2 SLO Master Water Report, section 4.3.4 and Table 4.9. 3 SLO Master Water Report, section 4.3.1 and Table 4.5. Attachment 2 - page 60 of 96 Page 158 of 512 5 1,080 AFY was allocated to each of the NCMA Agencies according to their percentage of the NCMA Municipal Entitlement and their assumed groundwater extractions were limited to the targets shown in Table 5. Table 5 – Modeled Groundwater Extraction NCMA Agencies Groundwater Entitlement (AFY) Groundwater Entitlement Percentage (%) Groundwater Extraction Target (AFY) Pismo Beach 700 16% 175 City of Arroyo Grande 1,323 31% 330 City of Grover Beach 1,407 32% 351 Oceano CSD 900 21% 224 Total 4,330 100% 1,080 Supply Availability Assumptions - The estimated amount of available water supply and usage priority for each Zone 3 contractor was calculated based on the anticipated amount of Lopez, Santa Maria Groundwater Basin and State Water Project water each agency would have available under potential future conditions. The actual amounts of available supply, potential future supplies, and each agencies’ strategy for using those supplies will vary by agency. Arroyo Grande’s Pismo Formation water supply was not incorporated in this analysis, however, if incorporated would likely proportionally increase the amount of stored Lopez Water the City of Arroyo Grande could generate. Table 6. Modeled Supply Available by Zone 3 Contractor Zone 3 Contractor Lopez (AFY) Groundwater Extraction Target (AFY) SWP (AFY) Total (AFY) Pismo 892 175 1,240 2,307 City of Arroyo Grande 2,290 330 0 2,620 City of Grover Beach 800 351 0 1,151 Oceano CSD 303 224 750 1,277 CSA 121 245 0 0 245 Notes: 1. Certain CSA 12 subcontractors have a SWP allocation but CSA 12 itself does not. Attachment 2 - page 61 of 96 Page 159 of 512 6 1.3 Climate Change Hydrology Development Climate change adjusted hydrology was developed using the data products from the California Water Commission’s (CWC) dataset for Water Storage Investment Program applications4. These data products include the results from statewide Variable Infiltration Capacity (VIC) watershed runoff models performed with historical meteorology and climate change adjusted meteorology using climate change assumptions centered at the year 2070. These VIC models are better suited to be used in a comparative manner rather than predictive, and for this reason a ratio is taken of climate change adjusted VIC model output to historic meteorology VIC model output. These ratios are applied to historic hydrology to estimate the climate change adjusted hydrology. The CWC’s VIC model provides gridded output for the state of California. VIC model results for the project watersheds were developed by delineating watersheds and crossing those watersheds with the VIC gridded output. Watersheds and CWC grid cells are shown in Figure 2. The ratio of VIC model Climate Change results to VIC model historic results is then applied to calculated historic project hydrology. The resulting climate change adjusted basin inflows are summarized in Table 7. An exceedance curve of annual inflow volumes is shown in Figure 1. Table 7 and Figure 1 both indicate that the Climate Change Adjusted hydrology is wetter than the historic hydrology. This phenomenon may be counterintuitive to many but is common to the coastal watersheds along the California Coast. Sierra Nevada watersheds also experience an increase in annual average runoff under Climate Change Adjusted hydrology using the CWC data. However, the pattern of runoff shifts to earlier in the year to a time when reservoirs can’t capture as much of the runoff due to flood control operations. While local Arroyo Grande Creek supplies appear to increase under Climate Change Adjusted hydrology, the State Water Project supplies decrease. This is because the State Water Project supplies originate in the northern Sierra Nevada mountains above Lake Oroville. Table 7 - Climate Change Adjusted Annual Average Inflows 4 Data and more information can be found at : https://data.ca.gov/dataset/climate-change-projections-for-water- storage-investment-program-wsip Watershed Historic Inflow (1969-2020), AF Climate Change Adjusted Inflow, AF Difference, AF Difference, % Lopez Lake 15,867 17,367 1,500 9.5% Arroyo Grande Basin 21,792 24,502 2,710 12.4% Attachment 2 - page 62 of 96 Page 160 of 512 7 Figure 1 - Annual Inflow Exceedance, Historical and Climate Change Adjusted Hydrology 0 20,000 40,000 60,000 80,000 100,000 120,000 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Annual Inflow, AFExceedance Historical Hydrology 2070 Climate Change Hydrology Attachment 2 - page 63 of 96 Page 161 of 512 8 Figure 2 - CWC Climate Change Grid Cells and Project Watersheds .... ....., l.'W2!12 1 5:&i~E5RI ECORP Con.sulli1!-M'., I.ill". ..._. __ n,~;,c110,u.1rr,:-,.1 .-n-...i::111.r.:.. 'If'. SLOC Lopez Pr oject Climate Change Hydrology l018-1f/3 lll!ou!m .l¥frolgicr Attachment 2 - page 64 of 96 Page 162 of 512 9 2.0 Model Results Model results are presented in three separate sections. Section 2.1 presents summary results of the baseline (A) versus Project scenarios (B,C) using Historic hydrology (51-year period of record) see Table 11. Table 12 provides the same results using Climate Change hydrology (D, E, F). Annual average values of water delivered and put to storage in Lopez are shown in Table 8 (Scenarios A and D), Table 9 (Scenarios B and E), and Table 10 (Scenarios C and F). The purpose is to illustrate the differences of each of the items below using Historic hydrology versus Climate Change hydrology. Results include:  Lopez Lake Storage Annual Low Point  Downstream Releases  Evaporation  Number of Spills  Peak Daily Spill Rate In addition, Table 13 presents summary results of the Project which will give each Contractor a storage account including:  Maximum amount stored in a year  Maximum use of stored water in a year  Maximum lost to spill in a year  Total lost to spills over simulation period Section 2.2 presents the same types of information presented in Section 2.1 but with Climate Change Hydrology (D, E, F) and in more detail on an annual basis. Section 2.3 presents the results of the Spill minimization studies performed on study F. The Zone 3 Contractors requested modeling that would look at ways to minimize the number of spill events under the Project model. Three scenarios were modeled in which limitations were placed on the amount of SWP water that could be stored by any contractor. 2.1 Results Summary Table 8 - Modeled Annual Average Water Delivered and Stored (AFY) – Baseline (A, D) Pismo Beach Grover Beach Arroyo Grande Oceano CSA 12 Total Lopez Lake Entitlement Supply Delivered same year 892 800 2,290 303 245 4,530 Delivered to Lopez Storage 0 0 0 0 0 0 Total 892 800 2,290 303 245 4,530 Lopez Lake Surplus Supply Delivered same year 20 18 51 7 0 96 State Water Project Supply Delivered same year 792 0 0 477 0 1,269 Delivered to Lopez Storage 0 0 0 0 0 0 Total 792 0 0 477 0 1,269 Groundwater Supply 175 351 170 224 0 920 Total Delivered/Stored 1,879 1,169 2,511 1,011 245 6,815 Attachment 2 - page 65 of 96 Page 163 of 512 10 Table 9 - Modeled Annual Average Water Delivered and Stored (AFY) - with Project (B, E) Pismo Beach Grover Beach Arroyo Grande Oceano CSA 12 Total Lopez Lake Entitlement Supply Delivered same year 583 800 2180 115 245 3923 Delivered to Lopez Storage 336 0 162 191 0 689 Total 919 800 2342 306 245 4612 Lopez Lake Surplus Supply Delivered same year 3 18 0 1 0 22 State Water Project Supply Delivered same year 1072 0 0 637 0 1709 Delivered to Lopez Storage 0 0 0 0 0 0 Total 1072 0 0 637 0 1709 Groundwater Supply 175 351 330 224 0 1080 Total Delivered/Stored 2169 1169 2672 1168 245 7423 Table 10 - Modeled Annual Average Water Delivered and Stored (AFY) - with Project (C, F) Pismo Beach Grover Beach Arroyo Grande Oceano CSA 12 Total Lopez Lake Entitlement Supply Delivered same year 892 800 2,180 303 245 4420 Delivered to Lopez Storage 0 0 162 0 0 162 Total 892 800 2,342 303 245 4582 Lopez Lake Surplus Supply Delivered same year 20 18 0 7 0 45 State Water Project Supply Delivered same year 745 0 0 448 0 1193 Delivered to Lopez Storage 354 0 0 215 0 569 Total 1099 0 0 663 0 1762 Groundwater Supply 175 351 330 224 0 1080 Total Delivered/Stored 2186 1169 2672 1197 245 7469 Table 11 - Summary Results Table - with Historic Hydrology With Project Baseline (A) Maximize Lopez Storage (B) Maximize SWP Storage (C) Lopez Lake Storage Annual Low Point (AF) Average 34,380 36,183 36,051 Minimum 9,105 12,690 12,298 Maximum 49,066 49,295 49,359 Downstream Releases (AFY) Average 4,100 4,100 4,100 Maximum 4,100 4,100 4,100 Evaporation (AFY) Average 2,585 2,655 2,649 Maximum 3,992 4,060 4,061 Number of Spills Total 16 18 18 Spill Rate (Daily Peak in cubic feet per second) Average 150 194 191 Maximum 2,426 2,427 2,427 Attachment 2 - page 66 of 96 Page 164 of 512 11 Table 12- Summary Results Table - with Climate Change Hydrology With Project Baseline (D) Maximize Lopez Storage (E) Maximize SWP Storage (F) Lopez Lake Storage Annual Low Point (AF) Average 35,439 37,179 37,061 Minimum 9,681 13,331 12,926 Maximum 48,925 49,267 49,351 Downstream Releases (AFY) Average 4,100 4,100 4,100 Maximum 4,100 4,100 4,100 Evaporation (AFY) Average 2,645 2,708 2,702 Maximum 3,984 4,043 4,043 Number of Spills Total 20 21 21 Spill Rate (Daily Peak in cubic feet per second) Average 268 315 315 Maximum 2,740 2,740 2,740 Table 13 - Summary of Contractor Storage Accounts (over a 51 year period of simulation) Contractor Maximum amount stored in a year (AF) Maximum use of stored water in a year (AF) Maximum lost to Spill in a year (AF) Total lost to spills over simulation period (AF) With Project - Maximize Lopez Storage (B) – Historical Hydrology Pismo 483 553 1,748 11,205 Oceano 286 327 1,041 6,607 Arroyo Grande 166 0 1,171 6,016 With Project - Maximize SWP Storage (C) – Historical Hydrology Pismo 494 533 1,583 12,202 Oceano 306 320 961 7,444 Arroyo Grande 166 0 1,169 6,015 With Project - Maximize Lopez Storage (E)–Climate Change Hydrology Pismo 483 533 1,692 11,074 Oceano 286 308 1,030 6,491 Arroyo Grande 166 0 1,080 6,102 With Project - Maximize SWP Storage (F) –Climate Change Hydrology Pismo 494 533 1,527 12,449 Oceano 306 320 928 7,595 Arroyo Grande 166 0 1,079 6,147 Note: For a year by year accounting of agency storage see Section 2.2.6 Attachment 2 - page 67 of 96 Page 165 of 512 12 2.2 Annual Results for Climate Change Hydrology Scenarios The results in the following sections represent details related to the modeling using Climate Change Hydrology and the Project scenarios. 2.2.1 Total Lopez Lake Storage The Project can cause additional water to be stored in Lopez Lake due to deliveries from Lopez Lake being offset by increased take of SWP water and subsequent storage of Lopez Lake water. The annual storage low point in Lopez Lake is shown in Table 14. An exceedance of the storage low point values is shown graphically in Figure 3. Annual storage low point is defined as the lowest reservoir storage within a Lopez water year (April 1 through March 30). For example, 1969 represents April 1, 1969, through March 30, 1970. Table 14 - Lopez Lake Annual Low Point with Climate Change Hydrology Baseline (D) Maximize Lopez Storage (E) Difference Maximize SWP Storage (F) Difference Acre-Feet Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 35,439 37,179 1,740 37,061 1,622 1969 46,537 47,072 535 47,207 669 1970 43,674 44,339 665 44,385 711 1971 37,956 39,759 1,803 39,717 1,761 1972 30,483 32,949 2,466 32,846 2,363 1973 39,270 42,451 3,181 42,266 2,996 1974 44,361 45,119 759 45,217 856 1975 40,580 42,266 1,686 42,241 1,661 1976 35,374 37,646 2,272 37,386 2,012 1977 27,502 29,145 1,643 28,874 1,372 1978 44,686 45,327 641 45,402 716 1979 42,331 43,085 755 43,038 707 1980 44,533 45,202 669 45,278 745 1981 42,558 43,248 690 43,236 678 1982 45,506 46,067 561 46,056 550 1983 48,839 49,150 311 49,268 429 1984 43,600 44,309 709 44,372 772 1985 38,121 39,794 1,674 39,764 1,643 1986 44,469 45,176 707 45,191 723 1987 39,192 39,787 594 39,619 426 1988 32,275 32,834 559 32,685 410 1989 25,823 27,275 1,452 27,050 1,227 1990 17,799 18,894 1,095 18,657 858 1991 18,450 19,421 971 19,220 770 1992 16,483 17,555 1,072 17,341 859 1993 25,449 27,441 1,992 27,148 1,699 Attachment 2 - page 68 of 96 Page 166 of 512 13 1994 19,622 22,359 2,737 22,020 2,398 1995 45,581 46,127 547 46,227 646 1996 44,546 45,157 611 45,198 652 1997 45,241 45,859 618 45,962 721 1998 48,925 49,267 343 49,351 426 1999 43,891 44,649 759 44,745 854 2000 43,498 44,229 731 44,250 752 2001 43,817 44,452 635 44,424 607 2002 39,114 40,731 1,617 40,605 1,491 2003 34,072 36,558 2,487 36,373 2,301 2004 31,893 35,208 3,315 34,951 3,058 2005 44,624 45,450 825 45,527 903 2006 44,584 45,299 716 45,376 793 2007 37,379 38,970 1,591 38,956 1,577 2008 37,772 40,119 2,346 39,675 1,903 2009 31,529 34,419 2,890 33,942 2,413 2010 36,123 39,880 3,757 39,323 3,200 2011 45,226 45,927 701 46,035 809 2012 39,367 40,945 1,578 40,954 1,587 2013 31,041 33,528 2,487 33,393 2,351 2014 22,728 25,246 2,518 24,920 2,192 2015 15,607 18,504 2,897 18,151 2,543 2016 9,681 13,331 3,650 12,926 3,244 2017 24,180 28,615 4,435 28,174 3,994 2018 18,721 23,241 4,520 22,909 4,189 2019 26,702 31,876 5,173 31,593 4,891 2020 21,508 28,048 6,540 27,766 6,258 Attachment 2 - page 69 of 96 Page 167 of 512 14 Figure 3 - Lopez Lake Storage Annual Low Point 2.2.2 Downstream releases The Project modeling shows no change in non-spill downstream releases. The modeling shows that Lopez Lake can deliver 4,100 AF of non-spill downstream releases each year in both the baseline and Project scenarios in both historical hydrology and climate change hydrology models. 2.2.3 Evaporation The higher Lopez Lake storage levels result in higher evaporation with the contract changes. Increases due to increased storage is deducted from each contractor’s storage account in proportion to their storage account volumes. Annual Average Evaporation Volumes for both the Baseline and Project modeling are shown in Tables 15 and 16. Table 15 - Annual Evaporation Volumes, Maximize Lopez Storage (E) Baseline (D) With Project (E) Difference Increase due to Storage of Lopez water Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 2,645 2,708 62 62 Total 137,545 140,792 3,247 3,247 1969 2,608 2,615 8 8 1970 3,962 3,976 14 14 1971 3,984 4,043 58 58 1972 3,430 3,544 114 114 1973 3,356 3,495 139 139 1974 3,460 3,509 50 50 1975 3,311 3,354 44 44 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 0% 20% 40% 60% 80% 100%Storage, Acre-FeetExceedance Baseline (D)Maximize Lopez Storage (E)Maximize SWP Storage (F) Attachment 2 - page 70 of 96 Page 168 of 512 15 1976 3,283 3,380 97 97 1977 2,978 3,102 124 124 1978 3,617 3,655 38 38 1979 3,656 3,671 15 15 1980 3,349 3,359 10 10 1981 3,923 3,938 15 15 1982 3,160 3,173 14 14 1983 3,032 3,036 4 4 1984 3,538 3,548 10 10 1985 3,135 3,184 49 49 1986 2,881 2,898 17 17 1987 2,561 2,586 25 25 1988 2,824 2,851 27 27 1989 2,769 2,822 53 53 1990 2,391 2,494 103 103 1991 2,010 2,090 79 79 1992 1,932 2,013 81 81 1993 2,282 2,368 87 87 1994 2,123 2,267 144 144 1995 2,688 2,726 37 37 1996 3,196 3,205 9 9 1997 3,402 3,411 9 9 1998 2,687 2,691 5 5 1999 2,835 2,842 7 7 2000 3,095 3,106 11 11 2001 2,867 2,877 9 9 2002 2,594 2,634 40 40 2003 2,475 2,553 78 78 2004 2,462 2,585 123 123 2005 2,353 2,382 30 30 2006 2,524 2,534 9 9 2007 2,560 2,597 37 37 2008 2,247 2,307 60 60 2009 2,313 2,415 101 101 2010 2,008 2,111 103 103 2011 2,202 2,222 21 21 2012 2,007 2,034 27 27 2013 1,772 1,830 58 58 2014 1,669 1,765 96 96 2015 1,298 1,431 133 133 Attachment 2 - page 71 of 96 Page 169 of 512 16 2016 1,198 1,361 164 164 2017 2,002 2,197 195 195 2018 1,732 1,967 234 234 2019 970 1,087 117 117 2020 836 950 114 114 Table 16 - Annual Evaporation Volumes, Maximize SWP Storage (F) Baseline (D) With Project (F) Difference Increase due to Storage of SWP water Increase due to Storage of Lopez water Acre-Feet Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 2,645 2,702 57 41 16 Total 137,545 140,507 2,962 2,135 827 1969 2,608 2,615 8 8 0 1970 3,962 3,978 16 12 5 1971 3,984 4,043 59 46 14 1972 3,430 3,540 110 87 23 1973 3,356 3,488 133 106 27 1974 3,460 3,508 48 40 9 1975 3,311 3,357 46 41 5 1976 3,283 3,375 93 78 14 1977 2,978 3,087 109 84 25 1978 3,617 3,651 34 24 9 1979 3,656 3,671 15 15 0 1980 3,349 3,360 10 10 0 1981 3,923 3,939 16 16 0 1982 3,160 3,173 13 13 0 1983 3,032 3,036 4 4 0 1984 3,538 3,549 11 7 4 1985 3,135 3,186 50 39 11 1986 2,881 2,898 17 15 2 1987 2,561 2,583 21 16 5 1988 2,824 2,842 19 4 15 1989 2,769 2,812 43 16 27 1990 2,391 2,477 86 43 42 1991 2,010 2,073 63 8 54 1992 1,932 1,997 65 0 65 1993 2,282 2,353 71 16 56 1994 2,123 2,248 125 62 63 1995 2,688 2,722 34 21 13 1996 3,196 3,205 10 10 0 Attachment 2 - page 72 of 96 Page 170 of 512 17 1997 3,402 3,412 10 10 0 1998 2,687 2,692 6 6 0 1999 2,835 2,843 8 8 0 2000 3,095 3,107 12 11 0 2001 2,867 2,876 9 9 0 2002 2,594 2,631 37 32 5 2003 2,475 2,547 72 60 12 2004 2,462 2,576 114 95 19 2005 2,353 2,381 28 23 6 2006 2,524 2,534 10 10 0 2007 2,560 2,599 39 34 5 2008 2,247 2,302 54 45 9 2009 2,313 2,397 84 66 18 2010 2,008 2,095 87 69 19 2011 2,202 2,221 19 16 3 2012 2,007 2,035 28 25 4 2013 1,772 1,829 57 48 9 2014 1,669 1,758 90 73 17 2015 1,298 1,415 117 86 30 2016 1,198 1,338 140 104 36 2017 2,002 2,178 176 134 42 2018 1,732 1,949 217 166 51 2019 970 1,081 111 85 27 2020 836 944 108 81 27 Attachment 2 - page 73 of 96 Page 171 of 512 18 2.2.4 Annual and Monthly Spill Volumes Annual spill volumes are shown in Tables 17 and 18, and annual spill volume exceedances are shown in Table 19. The Project under both scenarios (E & F) increases spill events in the climate change hydrology studies from 20 out of the 52-year study period to 21 years out of the 52-year study period. Annual spill volume exceedances are shown graphically in Figure 4. Of the total increase in spills in the Maximize SWP storage scenario (F), 77% of the spills are due to storage of SWP water in Lopez Reservoir, and the remaining 23% of the increase is due to increased storage of Lopez water. Table 17 - Modeled Annual Spills with Maximize Lopez Storage (E) Annual Spill Volume Days of Spill Baseline (D) With Project (E) Difference Baseline (D) With Project (E) Difference Acre-Feet Acre-Feet Acre-Feet Days Days Days Average 5,591 6,119 529 30 35 5 Total 290,711 318,195 27,484 1,558 1,811 253 Count 20 21 1 20 21 1 1969 9,806 10,224 419 121 121 0 1970 820 1,509 690 29 32 3 1971 0 0 0 0 0 0 1972 0 0 0 0 0 0 1973 0 0 0 0 0 0 1974 768 4,073 3,305 21 65 44 1975 0 0 0 0 0 0 1976 0 0 0 0 0 0 1977 0 0 0 0 0 0 1978 14,308 16,088 1,780 82 86 4 1979 431 1,224 793 18 19 1 1980 26,164 26,989 825 93 96 3 1981 828 1,621 793 27 29 2 1982 833 1,754 922 36 38 2 1983 88,114 88,839 725 202 208 6 1984 6,306 6,729 423 120 128 8 1985 0 0 0 0 0 0 1986 5,439 7,210 1,772 49 54 5 1987 0 0 0 0 0 0 1988 0 0 0 0 0 0 1989 0 0 0 0 0 0 1990 0 0 0 0 0 0 1991 0 0 0 0 0 0 1992 0 0 0 0 0 0 1993 0 0 0 0 0 0 Attachment 2 - page 74 of 96 Page 172 of 512 19 1994 0 0 0 0 0 0 1995 7,462 10,362 2,900 80 91 11 1996 11,141 11,768 627 76 82 6 1997 34,945 35,632 687 120 121 1 1998 58,673 59,495 822 169 188 19 1999 3,342 3,722 380 103 137 34 2000 4,298 5,100 802 65 64 -1 2001 5,621 6,428 807 54 52 -2 2002 0 0 0 0 0 0 2003 0 0 0 0 0 0 2004 0 0 0 0 0 0 2005 0 3,191 3,191 0 58 58 2006 4,414 5,371 957 40 63 23 2007 0 0 0 0 0 0 2008 0 0 0 0 0 0 2009 0 0 0 0 0 0 2010 0 0 0 0 0 0 2011 6,999 10,865 3,866 53 79 26 2012 0 0 0 0 0 0 2013 0 0 0 0 0 0 2014 0 0 0 0 0 0 2015 0 0 0 0 0 0 2016 0 0 0 0 0 0 2017 0 0 0 0 0 0 2018 0 0 0 0 0 0 2019 0 0 0 0 0 0 2020 0 0 0 0 0 0 Table 18 - Modeled Annual Spills with Maximize SWP Storage (F) Annual Spill Volume Days of Spill Baseline (D) With Project (F) Difference Baseline (D) With Project (F) Difference Acre-Feet Acre-Feet Acre-Feet Days Days Days Average 5,591 6,106 516 30 35 5 Total 290,711 317,520 26,809 1,558 1,827 269 Count 20 21 1 20 21 1 1969 9,806 10,192 386 121 121 0 1970 820 1,562 743 29 37 8 1971 0 0 0 0 0 0 1972 0 0 0 0 0 0 1973 0 0 0 0 0 0 Attachment 2 - page 75 of 96 Page 173 of 512 20 1974 768 3,900 3,131 21 63 42 1975 0 0 0 0 0 0 1976 0 0 0 0 0 0 1977 0 0 0 0 0 0 1978 14,308 15,816 1,508 82 85 3 1979 431 1,307 877 18 21 3 1980 26,164 26,977 812 93 94 1 1981 828 1,719 890 27 31 4 1982 833 1,718 886 36 38 2 1983 88,114 88,826 711 202 203 1 1984 6,306 6,846 541 120 139 19 1985 0 0 0 0 0 0 1986 5,439 7,210 1,771 49 54 5 1987 0 0 0 0 0 0 1988 0 0 0 0 0 0 1989 0 0 0 0 0 0 1990 0 0 0 0 0 0 1991 0 0 0 0 0 0 1992 0 0 0 0 0 0 1993 0 0 0 0 0 0 1994 0 0 0 0 0 0 1995 7,462 10,023 2,561 80 89 9 1996 11,141 11,914 774 76 82 6 1997 34,945 35,721 776 120 125 5 1998 58,673 59,576 903 169 182 13 1999 3,342 3,739 397 103 145 42 2000 4,298 5,247 949 65 67 2 2001 5,621 6,499 878 54 54 0 2002 0 0 0 0 0 0 2003 0 0 0 0 0 0 2004 0 0 0 0 0 0 2005 0 3,010 3,010 0 57 57 2006 4,414 5,404 990 40 63 23 2007 0 0 0 0 0 0 2008 0 0 0 0 0 0 2009 0 0 0 0 0 0 2010 0 0 0 0 0 0 2011 6,999 10,313 3,315 53 77 24 2012 0 0 0 0 0 0 2013 0 0 0 0 0 0 Attachment 2 - page 76 of 96 Page 174 of 512 21 2014 0 0 0 0 0 0 2015 0 0 0 0 0 0 2016 0 0 0 0 0 0 2017 0 0 0 0 0 0 2018 0 0 0 0 0 0 2019 0 0 0 0 0 0 2020 0 0 0 0 0 0 Table 19 - Modeled Annual Spill Volume Exceedances Baseline (D) Maximize Lopez Storage (E) Maximize SWP Storage (F) Acre-Feet Acre-Feet 2% 88,114 88,839 88,826 4% 58,673 59,495 59,576 6% 34,945 35,632 35,721 8% 26,164 26,989 26,977 9% 14,308 16,088 15,816 11% 11,141 11,768 11,914 13% 9,806 10,865 10,313 15% 7,462 10,362 10,192 17% 6,999 10,224 10,023 19% 6,306 7,210 7,210 21% 5,621 6,729 6,846 23% 5,439 6,428 6,499 25% 4,414 5,371 5,404 26% 4,298 5,100 5,247 28% 3,342 4,073 3,900 30% 833 3,722 3,739 32% 828 3,191 3,010 34% 820 1,754 1,719 36% 768 1,621 1,718 38% 431 1,509 1,562 40% 0 1,224 1,307 42% 0 0 0 43% 0 0 0 45% 0 0 0 47% 0 0 0 49% 0 0 0 51% 0 0 0 53% 0 0 0 Attachment 2 - page 77 of 96 Page 175 of 512 22 55% 0 0 0 57% 0 0 0 58% 0 0 0 60% 0 0 0 62% 0 0 0 64% 0 0 0 66% 0 0 0 68% 0 0 0 70% 0 0 0 72% 0 0 0 74% 0 0 0 75% 0 0 0 77% 0 0 0 79% 0 0 0 81% 0 0 0 83% 0 0 0 85% 0 0 0 87% 0 0 0 89% 0 0 0 91% 0 0 0 92% 0 0 0 94% 0 0 0 96% 0 0 0 98% 0 0 0 Attachment 2 - page 78 of 96 Page 176 of 512 23 Figure 4 - Annual Spill Volume Exceedance Average monthly spill volumes are shown in Figure 5. Increases in spills are generally concentrated in February through April, with the largest increase in March. Figure 5 - Average Monthly Spills at Lopez Reservoir 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Annual Volume, Acre-FeetExceedance Baseline (D)Maximize Lopez Storage (E)Maximize SWP Imports (F) 0 500 1,000 1,500 2,000 2,500 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug SepAverage Monthly Spill Volume, AFBaseline (D)Maximize Lopez Storage (E)Maximize SWP Storage (F)■ ■ ■ Attachment 2 - page 79 of 96 Page 177 of 512 24 2.2.5 Peak Flow Rates Peak flow rates due to spills at selected locations along Arroyo Grande are shown in Tables 20 through 22. Peak flow rates are shown graphically in figures 6 through 8. Table 20 - Annual Peak Spill Rates below Lopez Dam Climate Change Baseline (D) Maximize Lopez Storage (E) Difference Maximize SWP Storage (F) Difference CFS CFS CFS CFS CFS 1969 301 301 0 301 0 1970 70 107 37 114 44 1971 0 0 0 0 0 1972 0 0 0 0 0 1973 0 0 0 0 0 1974 32 193 161 193 161 1975 0 0 0 0 0 1976 0 0 0 0 0 1977 0 0 0 0 0 1978 1,560 2,006 446 2,006 446 1979 44 234 189 232 188 1980 1,725 1,726 0 1,726 0 1981 76 308 232 307 231 1982 85 296 212 276 191 1983 2,740 2,740 0 2,740 0 1984 522 522 0 522 0 1985 0 0 0 0 0 1986 602 603 0 603 0 1987 0 0 0 0 0 1988 0 0 0 0 0 1989 0 0 0 0 0 1990 0 0 0 0 0 1991 0 0 0 0 0 1992 0 0 0 0 0 1993 0 0 0 0 0 1994 0 0 0 0 0 1995 707 707 0 707 0 1996 783 784 0 784 0 1997 1,030 1,030 0 1,030 0 1998 1,231 1,231 0 1,231 0 1999 182 182 0 182 0 2000 140 272 132 270 130 Attachment 2 - page 80 of 96 Page 178 of 512 25 2001 756 1,188 431 1,190 434 2002 0 0 0 0 0 2003 0 0 0 0 0 2004 0 0 0 0 0 2005 0 300 300 300 300 2006 369 369 0 369 0 2007 0 0 0 0 0 2008 0 0 0 0 0 2009 0 0 0 0 0 2010 0 0 0 0 0 2011 451 658 207 658 207 2012 0 0 0 0 0 2013 0 0 0 0 0 2014 0 0 0 0 0 2015 0 0 0 0 0 2016 0 0 0 0 0 2017 0 0 0 0 0 2018 0 0 0 0 0 2019 0 0 0 0 0 2020 0 0 0 0 0 Figure 6 - Annual Peak Spill Rates below Lopez Dam (D,F) 0 500 1000 1500 2000 2500 3000 Flow, cfsBaseline (D)Increase Due to Project, Maximize SWP Storage (F) I I I II I I II I 11 I ■ ■ Attachment 2 - page 81 of 96 Page 179 of 512 26 Table 21 - Annual Peak Spill Rates at AG stream gage Climate Change Baseline (D) Maximize Lopez Storage (E) Difference Maximize SWP Storage(F) Difference CFS CFS CFS CFS CFS 1969 1534.6 1534.6 0.0 1534.6 0.0 1970 142.1 166.5 24.5 166.5 24.5 1971 36.0 36.0 0.0 36.0 0.0 1972 96.4 96.4 0.0 96.4 0.0 1973 349.5 349.5 0.0 349.5 0.0 1974 130.8 286.5 155.7 286.5 155.7 1975 18.4 18.4 0.0 18.4 0.0 1976 15.1 15.1 0.0 15.1 0.0 1977 14.0 14.0 0.0 14.0 0.0 1978 1706.7 2152.9 446.2 2152.9 446.2 1979 106.8 334.3 227.5 332.9 226.1 1980 1955.6 1955.8 0.2 1955.8 0.2 1981 124.2 337.9 213.7 336.5 212.3 1982 283.4 543.9 260.6 523.2 239.8 1983 5647.4 5647.6 0.2 5647.6 0.2 1984 891.6 891.8 0.2 891.8 0.2 1985 14.8 14.8 0.0 14.8 0.0 1986 830.8 831.0 0.2 831.0 0.2 1987 13.0 13.0 0.0 13.0 0.0 1988 18.7 18.7 0.0 18.7 0.0 1989 35.8 35.8 0.0 35.8 0.0 1990 8.5 8.5 0.0 8.5 0.0 1991 294.9 294.9 0.0 294.9 0.0 1992 465.0 465.0 0.0 465.0 0.0 1993 492.7 492.7 0.0 492.7 0.0 1994 12.9 12.9 0.0 12.9 0.0 1995 1358.8 1358.8 0.0 1358.8 0.0 1996 931.3 931.5 0.2 931.5 0.2 1997 1334.6 1334.8 0.2 1334.8 0.2 1998 1718.3 1718.5 0.2 1718.5 0.2 1999 202.4 202.5 0.2 202.5 0.2 2000 182.8 345.9 163.2 344.4 161.7 2001 1954.6 2385.9 431.2 2388.4 433.7 2002 9.6 9.6 0.0 9.6 0.0 2003 30.4 30.4 0.0 30.4 0.0 2004 51.1 51.1 0.0 51.1 0.0 Attachment 2 - page 82 of 96 Page 180 of 512 27 2005 276.7 425.7 149.1 425.7 149.1 2006 504.4 504.6 0.2 504.6 0.2 2007 17.9 17.9 0.0 17.9 0.0 2008 440.7 440.7 0.0 440.7 0.0 2009 25.5 25.5 0.0 25.5 0.0 2010 274.7 274.7 0.0 274.7 0.0 2011 761.2 1419.2 658.0 1419.2 658.0 2012 20.5 20.5 0.0 20.5 0.0 2013 13.3 13.3 0.0 13.3 0.0 2014 12.0 12.0 0.0 12.0 0.0 2015 14.1 14.1 0.0 14.1 0.0 2016 6.0 6.0 0.0 6.0 0.0 2017 463.1 463.1 0.0 463.1 0.0 2018 9.7 9.7 0.0 9.7 0.0 2019 236.6 236.6 0.0 236.6 0.0 2020 23.2 23.2 0.0 23.2 0.0 Figure 7 - Annual Peak Spill Rates at AG stream gage (D, F) 0 1000 2000 3000 4000 5000 6000 Flow, cfsBaseline (D)Increase Due to Project, Maximize SWP Storage (F)■ ■ Attachment 2 - page 83 of 96 Page 181 of 512 28 Table 22 - Annual Peak Spill Rates at 22nd Street Bridge Baseline (D) Maximize Lopez Storage (E) Difference Maximize SWP Storage (F) Difference CFS CFS CFS CFS CFS 1969 1898.8 1898.8 0.0 1898.8 0.0 1970 145.4 167.9 22.4 167.9 22.4 1971 44.7 44.7 0.0 44.7 0.0 1972 96.8 96.8 0.0 96.8 0.0 1973 378.5 378.2 -0.3 378.2 -0.3 1974 198.1 299.6 101.4 299.5 101.4 1975 23.9 23.9 0.0 23.9 0.0 1976 14.7 14.6 0.0 14.6 0.0 1977 15.5 15.5 0.0 15.5 0.0 1978 1866.3 2312.6 446.2 2312.6 446.2 1979 126.9 340.0 213.1 338.6 211.7 1980 1970.6 1970.8 0.2 1970.8 0.2 1981 132.2 337.6 205.4 336.3 204.1 1982 305.8 556.7 250.9 537.5 231.7 1983 5603.0 5603.1 0.2 5603.1 0.2 1984 906.9 907.0 0.2 907.0 0.2 1985 16.1 16.1 -0.1 16.1 -0.1 1986 821.8 818.3 -3.5 818.2 -3.6 1987 13.0 12.9 -0.1 12.9 -0.1 1988 17.7 17.6 -0.1 17.6 -0.1 1989 35.8 35.8 0.0 35.8 0.0 1990 8.5 8.5 0.0 8.5 0.0 1991 309.5 307.1 -2.4 307.1 -2.4 1992 489.2 485.3 -3.9 485.3 -3.9 1993 533.4 528.8 -4.5 528.8 -4.6 1994 31.8 31.7 -0.1 31.7 -0.1 1995 1465.1 1465.1 0.0 1465.1 0.0 1996 974.1 968.8 -5.4 968.5 -5.6 1997 1432.4 1432.6 0.2 1432.6 0.2 1998 1936.5 1936.7 0.2 1936.7 0.2 1999 196.2 195.3 -0.9 195.3 -1.0 2000 200.8 384.5 183.7 383.1 182.3 2001 2407.3 2838.6 431.2 2841.1 433.7 2002 11.7 11.7 0.0 11.7 0.0 Attachment 2 - page 84 of 96 Page 182 of 512 29 2003 37.4 37.4 0.0 37.4 0.0 2004 49.7 49.2 -0.5 49.2 -0.5 2005 330.5 430.0 99.6 430.0 99.5 2006 512.3 508.2 -4.1 508.1 -4.2 2007 18.5 18.5 0.0 18.5 0.0 2008 429.3 425.2 -4.1 425.1 -4.1 2009 25.6 25.3 -0.3 25.3 -0.3 2010 255.0 195.8 -59.1 195.8 -59.1 2011 813.1 1459.7 646.6 1459.7 646.6 2012 19.2 19.0 -0.2 19.0 -0.2 2013 13.3 13.3 0.0 13.3 0.0 2014 11.1 9.8 -1.3 9.8 -1.3 2015 14.1 14.1 0.0 14.1 0.0 2016 7.5 7.5 0.0 7.5 0.0 2017 488.1 488.1 0.0 488.1 0.0 2018 10.4 10.4 0.0 10.4 0.0 2019 156.6 156.6 0.0 156.6 0.0 2020 12.1 12.1 0.0 12.1 0.0 Figure 8 - Annual Peak Spill Rates at 22nd Street Bridge, maximize SWP storage (D, F) -1000 0 1000 2000 3000 4000 5000 6000 Flow, cfsBaseline (D)Increase Due to Project, Maximize SWP Storage (F)Channel Capacity Capacity of AG Creek Flood Control Channel ---------~---------------- •--••---I_I ___ ••• _111 I ___ l l _l_!I __ -I._ ro°> {'> ::\1, ~ :\<, ",,°> :\'b ~ 9,"> ~ ~ ",,°> ~ ~ ?P {'> ?,,,, ",,~ ?,<o {'> ?,°> {'> !::)1, 1,<::l !::)<, ~ c'b 1,<::l ~",, 1,<::> ~ ~ ~ 1,<::> cf> 1,<::> -- Attachment 2 - page 85 of 96 Page 183 of 512 30 2.2.6 Storage Accounts – Maximize Lopez Storage (E) Three of the five contractors have supplies in excess of demands at the 2035 level of demand – Pismo Beach, Oceano CSD, and Arroyo Grande. Pismo Beach, Oceano CSD, and Arroyo Grande are modeled as storing Lopez Lake water in Lopez Lake. An accounting of the water in these storage accounts for each year is shown in Tables 23 through 25. Table 23 - Pismo Beach Use of Storage Account under maximize Lopez Storage (E) Calendar Year Delivered to Storage Delivery from Storage Lost to Evaporation Lost to Spills Resulting End of Year Storage Acre-Feet Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 336 44 32 213 487 1969 399 0 0 0 0 1970 450 3 22 0 299 1971 443 0 59 0 677 1972 442 0 92 0 1,028 1973 443 0 110 0 1,357 1974 483 70 11 1,692 0 1975 443 0 25 0 386 1976 312 0 59 0 768 1977 0 533 75 0 506 1978 418 10 3 555 0 1979 444 21 16 141 211 1980 416 28 1 570 0 1981 431 26 15 148 197 1982 421 5 3 607 0 1983 299 5 0 303 0 1984 407 1 12 0 174 1985 443 0 40 0 571 1986 437 36 2 954 0 1987 0 200 14 0 116 1988 0 113 4 0 0 1989 443 0 8 0 90 1990 0 235 28 0 185 1991 0 204 2 0 0 1992 0 3 0 0 0 1993 443 0 6 0 82 1994 443 0 38 0 483 1995 422 17 2 890 0 1996 414 34 1 284 0 1997 403 29 14 72 205 1998 331 15 0 543 0 Attachment 2 - page 86 of 96 Page 184 of 512 31 1999 408 19 0 167 0 2000 428 37 8 209 136 2001 414 37 10 307 176 2002 443 0 33 0 562 2003 443 0 58 0 943 2004 442 0 86 0 1,300 2005 468 83 13 1,443 177 2006 467 22 1 541 0 2007 443 0 21 0 390 2008 94 0 40 0 765 2009 324 0 61 0 1,009 2010 443 0 62 0 1,292 2011 466 48 3 1,649 0 2012 442 0 15 0 390 2013 443 0 38 0 791 2014 0 151 56 0 941 2015 247 0 61 0 945 2016 442 0 94 0 1,136 2017 443 0 107 0 1,469 2018 142 0 119 0 1,740 2019 0 0 58 0 1,923 2020 0 321 69 0 1,888 Table 24 - Oceano CSD Use of Storage Account under Maximize Lopez Storage (E) Calendar Year Delivered to Storage Delivery from Storage Lost to Evaporation Lost to Spills Resulting End of Year Storage Acre-Feet Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 191 33 19 125 279 1969 194 0 0 0 0 1970 254 3 12 0 164 1971 268 0 34 0 393 1972 267 0 55 0 609 1973 268 0 66 0 810 1974 286 53 6 1,001 0 1975 268 0 15 0 227 1976 189 0 36 0 460 1977 0 308 44 0 320 1978 219 9 2 354 0 1979 261 21 8 81 114 1980 214 25 1 318 0 1981 246 25 8 83 105 1982 238 5 2 349 0 Attachment 2 - page 87 of 96 Page 185 of 512 32 1983 112 5 0 169 0 1984 218 2 6 0 91 1985 268 0 23 0 333 1986 246 31 1 554 0 1987 0 104 8 0 76 1988 0 80 3 0 0 1989 268 0 5 0 57 1990 0 135 16 0 118 1991 0 125 1 0 0 1992 0 1 0 0 0 1993 268 0 4 0 54 1994 268 0 24 0 298 1995 218 13 1 541 0 1996 225 31 0 146 0 1997 203 28 7 40 108 1998 123 11 0 300 0 1999 207 18 0 81 0 2000 237 36 4 118 71 2001 221 35 6 168 93 2002 268 0 19 0 323 2003 268 0 34 0 556 2004 267 0 51 0 775 2005 269 69 7 854 96 2006 269 17 0 302 0 2007 268 0 12 0 229 2008 57 0 24 0 466 2009 196 0 39 0 649 2010 268 0 39 0 821 2011 263 36 2 1,030 0 2012 267 0 9 0 228 2013 268 0 23 0 472 2014 0 57 34 0 592 2015 149 0 38 0 587 2016 267 0 59 0 705 2017 268 53 63 0 857 2018 90 142 63 0 878 2019 0 118 28 0 891 2020 0 126 31 0 885 Attachment 2 - page 88 of 96 Page 186 of 512 33 Table 25 - Arroyo Grande Use of Storage Account under Maximize Lopez Storage (E) Calendar Year Delivered to Storage Delivery from Storage Lost to Evaporation Lost to Spills Resulting End of Year Storage Acre-Feet Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 162 0 22 117 317 1969 0 0 0 0 0 1970 165 0 11 0 154 1971 165 0 26 0 293 1972 166 0 38 0 420 1973 165 0 44 0 541 1974 165 0 4 701 0 1975 165 0 10 0 155 1976 166 0 23 0 297 1977 165 0 41 0 421 1978 165 0 2 584 0 1979 165 0 7 61 97 1980 166 0 0 262 0 1981 165 0 7 65 92 1982 165 0 1 256 0 1983 165 0 0 165 0 1984 166 0 11 0 155 1985 165 0 22 0 298 1986 165 0 1 462 0 1987 165 0 8 0 157 1988 166 0 23 0 299 1989 165 0 39 0 425 1990 165 0 53 0 536 1991 165 0 59 0 642 1992 166 0 70 0 738 1993 165 0 69 0 834 1994 165 0 79 0 919 1995 165 0 4 1,080 0 1996 166 0 0 165 0 1997 165 0 8 38 119 1998 165 0 0 283 0 1999 165 0 0 165 0 2000 166 0 4 94 67 2001 165 0 5 143 84 2002 165 0 14 0 236 2003 165 0 23 0 377 2004 166 0 34 0 509 2005 165 0 6 583 84 Attachment 2 - page 89 of 96 Page 187 of 512 34 2006 165 0 0 249 0 2007 165 0 9 0 157 2008 166 0 16 0 306 2009 165 0 27 0 444 2010 165 0 28 0 581 2011 165 0 1 745 0 2012 166 0 6 0 159 2013 165 0 15 0 309 2014 165 0 25 0 449 2015 165 0 36 0 578 2016 166 0 57 0 686 2017 165 0 58 0 792 2018 165 0 62 0 896 2019 165 0 31 0 1,030 2020 166 0 39 0 1,156 2.2.7 Storage Accounts – Maximize SWP Imports Three contractors have supplies in excess of demands at the 2035 level of demand – Pismo Beach, Oceano CSD, and Arroyo Grande. Pismo Beach and Oceano CSD are modeled as storing SWP water in Lopez Lake (via a swap with Lopez supply), and Arroyo Grande is modeled as storing Lopez Lake water in Lopez Lake. An accounting of the water in these storage accounts for each year is shown in Tables 26 through 28. Table 26 - Pismo Beach Use of Storage Account under Maximize SWP Storage (F) Calendar Year Delivered to Storage Delivery from Storage Lost to Evaporation Lost to Spills Resulting End of Year Storage Acre-Feet Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 354 45 36 239 693 1969 444 2 9 170 374 1970 478 33 14 383 417 1971 443 0 55 0 803 1972 442 1 88 0 1,157 1973 443 0 106 0 1,491 1974 494 51 20 1,493 417 1975 443 0 45 0 813 1976 312 1 74 0 1,050 1977 0 533 73 0 445 1978 448 5 10 501 375 1979 449 7 12 451 353 1980 446 5 10 399 386 1981 442 8 12 456 350 Attachment 2 - page 90 of 96 Page 188 of 512 35 1982 434 5 10 767 0 1983 321 49 3 270 0 1984 442 0 10 0 431 1985 443 0 45 0 827 1986 454 12 9 881 377 1987 0 278 14 0 85 1988 0 83 2 0 0 1989 443 0 19 0 422 1990 0 216 30 0 178 1991 0 178 2 0 0 1992 0 0 0 0 0 1993 443 0 16 0 425 1994 443 0 51 0 814 1995 452 9 9 877 368 1996 439 18 8 781 0 1997 444 3 9 0 432 1998 313 124 3 586 35 1999 452 9 9 27 439 2000 449 7 8 487 385 2001 431 3 7 445 358 2002 443 0 33 0 765 2003 443 0 59 0 1,147 2004 442 1 87 0 1,502 2005 481 38 11 1527 404 2006 482 40 8 428 408 2007 443 0 34 0 814 2008 94 2 44 0 862 2009 324 0 60 0 1,123 2010 443 0 62 0 1,502 2011 481 39 9 1,523 410 2012 442 1 25 0 826 2013 443 0 50 0 1,217 2014 0 249 60 0 910 2015 247 0 63 0 1,092 2016 442 1 103 0 1,431 2017 443 0 115 0 1,756 2018 195 0 121 0 1,827 2019 443 0 61 0 2,207 2020 0 305 68 0 1,835 Attachment 2 - page 91 of 96 Page 189 of 512 36 Table 27 - Oceano CSD use of Storage Account under Maximize SWP Storage (F) Calendar Year Delivered to Storage Delivery from Storage Lost to Evaporation Lost to Spills Resulting End of Year Storage Acre-Feet Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 215 27 22 146 422 1969 269 1 5 96 227 1970 281 12 9 241 245 1971 268 0 34 0 480 1972 267 0 54 0 696 1973 268 0 65 0 899 1974 306 38 13 895 259 1975 268 0 28 0 499 1976 189 0 46 0 642 1977 0 320 43 0 281 1978 271 3 6 315 228 1979 272 4 8 277 211 1980 272 5 6 240 234 1981 266 3 8 279 211 1982 263 4 6 463 0 1983 197 34 2 163 0 1984 267 0 7 0 263 1985 268 0 28 0 503 1986 275 8 6 537 227 1987 0 167 8 0 54 1988 0 53 1 0 1 1989 268 0 13 0 256 1990 0 127 18 0 110 1991 0 111 1 0 0 1992 0 0 0 0 1 1993 268 0 11 0 258 1994 268 0 32 0 495 1995 273 5 6 535 222 1996 265 11 6 472 0 1997 270 1 6 0 263 1998 226 82 2 377 23 1999 273 5 6 24 268 2000 272 5 5 298 234 2001 257 2 5 272 214 2002 268 0 21 0 461 2003 268 0 36 0 693 2004 267 0 53 0 909 2005 295 27 7 924 247 Attachment 2 - page 92 of 96 Page 190 of 512 37 2006 295 28 5 260 250 2007 268 0 22 0 497 2008 57 1 27 0 528 2009 196 0 38 0 687 2010 268 0 38 0 917 2011 295 27 6 928 251 2012 267 0 16 0 505 2013 268 0 31 0 741 2014 0 148 36 0 559 2015 149 0 39 0 670 2016 267 0 64 0 875 2017 268 0 71 0 1,072 2018 118 0 74 0 1,117 2019 268 0 37 0 1,347 2020 0 181 41 0 1,124 Table 28 - Arroyo Grande Use of Storage Account under Maximize SWP Storage (F) Calendar Year Delivered to Storage Delivery from Storage Lost to Evaporation Lost to Spills Resulting End of Year Storage Acre-Feet Acre-Feet Acre-Feet Acre-Feet Acre-Feet Average 162 0 21 118 303 1969 0 0 0 0 0 1970 165 0 11 2 152 1971 165 0 26 0 291 1972 166 0 38 0 419 1973 165 0 44 0 539 1974 165 0 6 699 0 1975 165 0 10 0 155 1976 166 0 23 0 297 1977 165 0 41 0 421 1978 165 0 2 584 0 1979 165 0 0 165 0 1980 166 0 0 166 0 1981 165 0 1 164 0 1982 165 0 0 165 0 1983 165 0 0 165 0 1984 166 0 11 1 154 1985 165 0 21 0 297 1986 165 0 1 461 0 1987 165 0 8 0 157 1988 166 0 23 0 299 Attachment 2 - page 93 of 96 Page 191 of 512 38 1989 165 0 39 0 425 1990 165 0 53 0 536 1991 165 0 59 0 642 1992 166 0 70 0 737 1993 165 0 69 0 833 1994 165 0 80 0 918 1995 165 0 4 1,079 0 1996 166 0 0 166 0 1997 165 0 0 164 0 1998 165 0 0 165 0 1999 165 0 0 165 0 2000 166 0 0 165 0 2001 165 0 0 165 0 2002 165 0 9 0 156 2003 165 0 19 0 303 2004 166 0 29 0 439 2005 165 0 5 556 43 2006 165 0 0 207 0 2007 165 0 9 0 157 2008 166 0 16 0 306 2009 165 0 27 0 444 2010 165 0 28 0 581 2011 165 0 2 744 0 2012 166 0 6 0 159 2013 165 0 15 0 309 2014 165 0 25 0 449 2015 165 0 37 0 578 2016 166 0 57 0 686 2017 165 0 58 0 792 2018 165 0 62 0 895 2019 165 0 31 0 1,029 2020 166 0 39 0 1,155 Attachment 2 - page 94 of 96 Page 192 of 512 39 2.3 Spill Minimization Analysis Modeling was requested that would look at ways to minimize the number of spill events under the project model. A set of sensitivity runs based on scenario F (Maximize SWP Storage with climate change hydrology) were modeled in which limitations were placed on the amount of SWP water that could be stored by any contractor. When reservoir spills occur in the modeling, the model prioritized spills from storage accounts in the following order consistent with the proposed contract changes: 1. Spill from Lopez SWP accounts in proportion to their storage volumes 2. Spill from Lopez storage accounts in proportion to their storage volumes 3. Spill from Flood Control District account when all other storage accounts have been depleted. This method often results in SWP storage accounts being spilled on the leading edge of the inflow hydrograph, and Lopez storage accounts being spilled closer to the peak of the hydrograph. Some years both accounts spill on the same day. Limiting the amount of SWP water that can be stored in Lopez Reservoir will result in a lower volume of spill in most years, but often does not reduce the increase in annual peak flow rates below Lopez Reservoir. An example of this is shown for a spill event in 1978, the largest spill event in the period of record, in Figure 9 below. In addition to the contract change modeling, results are shown for a modeling study in which the SWP storage accounts are limited to 10% of the contractor’s annual demand, which is a very restrictive limitation and yet has a negligible effect on peak flow rates in this event. Figure 9 - 1978 Spill Event Figure 10 shows daily spill flows for a spill event in 2001. Here, putting a 10% of annual demand limitation on SWP storage reduces the increase in spill by less than 50%, but a 25% of annual demand limitation brings spills back to the peak flow of the full with project study. 0 500 1,000 1,500 2,000 Spill Flow, cfsBaseline With Contract Change With Contract Change and 10% Storage Limitation■ ■ ■ I :'.\Cb :'.\Cb :'.\Cb :'.\Cb :'.\Cb :'.\Cb :'.\Cb :'.\Cb :'.\Cb :'.\Cb ~~ \~ ~~ >l ~~ ~~ \~ ~~ ~""°' ~""°' '>;,\"Y '>;,'\V '>;,'\' '>;,\~ '>;,f> '>;,\<o '>;,'0 '>;,\'1> '?\°' '>;,\...,,~ Attachment 2 - page 95 of 96 Page 193 of 512 40 Figure 10 - 2001 Spill Event The effect of a SWP storage limitation on annual spill volumes are shown in Table 29. Table 29 - Effect of SWP Storage Limitations on Spill Volumes SWP Storage Limitation Total Spill Volume, 1969-2020 Base line Case (D) – 290,711 Project (F) – SWP Storage Limited to 10% of annual demand 302,853 Project (F) – SWP Storage Limited to 25% of annual demand 310,655 Project (F) – SWP Storage Limited to 50% of annual demand 314,479 Project (F) – SWP Storage Limited to 100% of annual demand 317,521 Project (F) – No Limitation 317,521 Note: Annual demand is that shown in Table 2 0 200 400 600 800 1,000 1,200 Flow, cfsBaseline With Contract Change With Contract Change and 10% Storage Limitation With Contract Change and 25% Storage Limitation ■ ■ ■ ■ Attachment 2 - page 96 of 96 Page 194 of 512 Page 1 of 3 day , 2022 PRESENT: Supervisors ABSENT: RESOLUTION NO._________ RESOLUTION APPROVING EXECUTION OF AMENDED AND RESTATED WATER SUPPLY CONTRACTS WITH THE ZONE 3 CONTRACTORS AND ADOPTING A NEGATIVE DECLARATION PURSUANT TO PUBLIC RESOURCES CODE SECTION 21000 ET SEQ. (CEQA) The following Resolution is now offered and read: WHEREAS, the San Luis Obispo County Flood Control and Water Conservation District (District) Zone 3 Contractors (Contractors) receive water entitlements from Lopez Reservoir via individual but substantially identical Water Supply Contracts (Contracts) with the District that were originally executed in 1966 and subsequently amended and restated; and WHEREAS, the Contractors wish to again restate and amend the Contracts to provide storage rights for each of the Contractors to store their unused entitlement, surplus water and State Water Project Water year over year in Lopez Reservoir and to permit the refunding of the bonds associated with the completed Lopez Dam Seismic Retrofit Project in order to reduce the costs of debt service (which purposes may advance on a similar schedule or on different schedules); and WHEREAS, providing storage rights allows for flexibility of multi-year water resource planning and enhanced water supply portfolio management for the Contractors; and WHEREAS, the proposed Amended and Restated Contracts continue to make clear that legally required water releases, including, without limitation, releases pursuant to any Habitat Conservation Plan, shall have first priority when the District is distributing Lopez Reservoir water; and WHEREAS, Environmental Division staff prepared a Negative Declaration for the proposed Amended and Restated Contracts (Project) which was approved by the Environmental Division Manager and which concludes that the Project will not have a significant effect on the environment and that no mitigation measures are required; and WHEREAS, prior to commencement of preparation of the Negative Declaration, staff conducted early consultation with potentially affected local, State and Federal agencies, Native American groups and other potentially interested parties but no substantive comments were received; and BEFORE THE BOARD OF SUPERVISORS of the SAN LUIS OBISPO COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT ATTACHMENT 4 Page 195 of 512 Page 2 of 3 WHEREAS, notice of intent to adopt the proposed Negative Declaration was also published in a local newspaper and circulated to the relevant, local, State and Federal agencies through the State Clearinghouse and by mail and the thirty (30) day review period for the Project ended on February 28, 2022; the only comments received were from the County of San Luis Obispo Department of Parks and Recreation opining that the Project would have potential net benefits for recreational use; and WHEREAS, the form of the Amended and Restated Contracts and the Negative Declaration have been presented to and considered at this meeting of the Board of Supervisors together with a summary of all comments received during the public review process; and NOW, THEREFORE, BE IT RESOLVED AND ORDERED by the Board of Supervisors of the County of San Luis Obispo, State of California acting as the governing board of the San Luis Obispo County Flood Control and Water Conservation District, as follows: Section 1. Recitals. The foregoing recitals are true and correct. Section 2. Approval of Amended and Restated Water Supply Contracts. The Amended and Restated Water Supply Contracts substantially in the form presented to and considered during this meeting of the Board of Supervisors are hereby approved. Any one of the Chairperson or Vice Chairperson of said Board, and each of them (collectively, the Authorized Officers) is hereby authorized and directed, for and in the name and on behalf of the District, to execute and deliver an Amended and Restated Water Supply Contract on substantially similar terms to each Contractor, with such insertions and changes as may be approved by the Authorized Officer executing the same, such approval to be conclusively evidenced by such execution and delivery provided that said Amended and Restated Water Supply Contract is approved as to form and legal effect by County Counsel. To accommodate the possibility of financing purposes proceeding on a different schedule than water storage purposes reflected in the form of the Amended and Restated Water Supply Contracts, the amendments contemplated in the form of the Amended and Restated Water Supply Contracts related to financing matters may instead be effected under a separate amendment document with each Contractor which the Board of Supervisors hereby approves and authorizes the Authorized Officer to execute and deliver, with such changes therein as the Authorized Officer shall approve, subject to prior approval of such changes by County Counsel, such approval to be conclusively established by the execution and delivery thereof by the Authorized Officer. Section 3. Negative Declaration. The Board of Supervisors reviewed and considered the information contained in the Negative Declaration and the whole record and finds that there is no substantial evidence that the Project will have a significant effect on the environment, that the Negative Declaration reflects the lead agency’s independent judgment and analysis, and hereby adopts the Negative Declaration. Section 4. Effective Date. This Resolution shall take effect immediately upon its passage and adoption. Page 196 of 512 Page 3 of 3 Upon motion of Supervisor _________________________, seconded by Supervisor _____________________, and on the following roll call vote, to wit: AYES: NOES: ABSENT: ABSTAINING: the foregoing resolution is hereby adopted on the ____ day of _________, 20___. Chairperson of the Board of Supervisors ATTEST: WADE HORTON Ex-Officio Clerk of the Board of Supervisors By: Deputy Clerk (SEAL) APPROVED AS TO FORM AND LEGAL EFFECT: RITA L. NEAL County Counsel By: Deputy County Counsel Dated: L:\Utilities\2022\_Resolutions\Zone 3 Amended Contracts rsl.docx July 29, 2022 Page 197 of 512 Response to Comments on the Lopez Water Project Contract Changes Draft Negative Declaration The Lopez Water Project Contract Changes Draft Negative Declaration (ND) was distributed on January 28, 2022, for a 30-day public comment period. The following agencies, organizations, and members of the public provided comments on the Draft ND: 1. County of San Luis Obispo Parks and Recreation Department, Nick Franco, Director, provide comments by email dated January 26, 2022. The comments stated the following in support of the project:“It looks like a potential net benefit to improve the opportunity to keep the water levels higher than existing levels, so that would definitely be good for our recreational users.” Response:The County acknowledged receipt of the comments. No other response or changes to the ND are required. A copy of the comment email is attached (Attachment A). No other comments were received. 1 of 2 $77$&+0(17 Page 198 of 512 From:Nick Franco To:Monica J. Stillman Subject:RE: Lopez Water Contract Changes draft ND Date:Wednesday, January 26, 2022 3:39:14 PM Attachments:image001.png image002.jpg Thanks for sharing! It looks like a potential net benefit to improve the opportunity to keep the water levels higher than existing levels, so that would definitely be good for our recreational uses. Thanks, Nick From: Monica J. Stillman <mjstillman@co.slo.ca.us> Sent: Wednesday, January 26, 2022 10:15 AM To: Nick Franco <nfranco@co.slo.ca.us> Subject: Lopez Water Contract Changes draft ND Hello Nick – The attached Negative Declaration for the proposed Lopez Water Project Contract Changes Project is out for a 30-day comment period, from January 28 to February 28, 2022. The project would change how water is stored in Lopez Reservoir, which could affect reservoir water levels and flows in Arroyo Grande Creek. It would not require any new construction or any changes to the existing Lopez Water Project infrastructure, and would not change existing water allocations or where the water is used. Thanks! Monica Monica J. Stillman Environmental Specialist III Public Works, County of San Luis Obispo Tel: (805) 781-1046 | An APWA Accredited Agency Website | Twitter | Map APWA $WWDFKPHQW$&RPPHQWVIURP&RXQW\RI6DQ/XLV2ELVSR3DUNVDQG5HFUHDWLRQ'HSDUWPHQW 2 of 2 Page 199 of 512 Item 8.d. MEMORANDUM TO: City Council FROM: Whitney McDonald, City Manager Timothy J. Carmel, City Attorney SUBJECT: Consideration of First Amendment to the Communications Site Lease Agreement (“Lease”) with T-Mobile West, LLC (“T-Mobile”), for the Operation of a Telecommunications Facility Located at Branch Mill Road (Reservoir 4) DATE: September 27, 2022 SUMMARY OF ACTION: Approve the First Amendment to the Communications Site Lease Agreement (“Lease”) with T-Mobile West, LLC (“T-Mobile”), successor in interest to Cingular Wireless, for the operation of a telecommunications facility located at Branch Mill Road, commonly known as the Reservoir 4 site. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: T-Mobile currently pays $30,643.80 per year under the Lease, with an automatic adjustment of three percent (3%) annually. The proposed Amendment will increase the annual revenue by $8,120.28 per year, which will continue to escalate automatically on the anniversary of the commencement date by three percent (3%) of the rent for the previous year. The Amendment will extend the term for an additional twenty years. RECOMMENDATION: Approve the First Amendment to the Communications Site Lease Agreement (“Lease”) with T-Mobile West, LLC (“T-Mobile”), successor in interest to Cingular Wireless, for the operation of a telecommunications facility located at Branch Mill Road, commonly known as the Reservoir 4 site. BACKGROUND: On January 14, 2004, the City entered into a Lease with Cingular Wireless for the installation, maintenance and operation of telecommunications facilities on City -owned property, contained within a 510 square foot area located on Branch Mill Road (Reservoir 4). The Lease had an initial five-year term commencing December 16, 2003, which automatically extended for three additional five-year terms. The Lease will expire on December 16, 2023. Page 200 of 512 Item 8.d. City Council Consideration of First Amendment to the Communications Site Lease Agreement (“Lease”) with T-Mobile West, LLC (“T-Mobile”), for the Operation of a Telecommunications Facility Located at Branch Mill Road (Reservoir 4) September 27, 2022 Page 2 In 2020, T-Mobile submitted a permit application to expand the leased area and update their equipment. They also requested an extension of the Lease term. Negotiations resulted in consensus on the following terms for an amended Lease:  The leased premises is expanded by 135 square feet;  The initial term shall be for seven years from the effective date of the amendment (this recaptures the time remaining from the original Lease), with three automatic five-year term extensions, unless T-Mobile provides notice that it will not renew at least sixty day prior to the commencement of the renewal term;  Monthly rent of $3,230.34 (increased to account for the additional leased area);  Automatic rent increases in the amount of 3% every year;  Reservoir maintenance provisions; and  $1,000 administrative fee. T-Mobile has approved and executed the amendment, a copy of which is attached. ANALYSIS OF ISSUES: The Amendment would provide revenue of $1,183,730.19 over the next 22 years, assuming that the Lease is not terminated early and there are no reductions in rent. If the lease is allowed to expire, the City can only expect to receive $49,618.02 for the remainder of the current term. While most of the telecommunications site leaseholders are trying to negotiate significant rent reductions, T -Mobile has agreed to maintain their current rent (prorated to account for the additional square footage) and annual escalation , has invested heavily in upgraded equipment and has been a good tenant; all of which indicate a good faith commitment to maintaining their tenancy in the long-term. The Amendment also contains important maintenance provisions not currently included in the Lease. This is important, as Reservoir 4 is scheduled to be recoated in the near future. ALTERNATIVES: The following alternatives are presented for consideration: 1. Approve the Amendment and authorize the Mayor to execute it on behalf of the City; 2. Reject the Amendment; 3. Direct staff to negotiate alternate terms with regard to the Amendment; or 4. Provide other direction to staff. Page 201 of 512 Item 8.d. City Council Consideration of First Amendment to the Communications Site Lease Agreement (“Lease”) with T-Mobile West, LLC (“T-Mobile”), for the Operation of a Telecommunications Facility Located at Branch Mill Road (Reservoir 4) September 27, 2022 Page 3 ADVANTAGES: Cell tower leases represent a significant and important revenue source to the City. Therefore, it is in the best interest of the City to approve the amendment to ensure this revenue stream for potentially 22 more years. DISADVANTAGES: No disadvantages are identified. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed First Amendment to Communications Site Lease Agreement 2. Communications Site Lease Agreement Page 202 of 512 1 FIRST AMENDMENT TO COMMUNICATIONS SITE LEASE AGREEMENT This First Amendment to Communications Site Lease Agreement (the “Amendment”) is effective as of the date of execution by the last party to sign (the “Effective Date”) by and between the City of Arroyo Grande, a municipal corporation formed under the laws of the State of California (“Lessor”) and T-Mobile West LLC, a Delaware limited liability company (“Lessee”) (each a “Party”, or collectively, the “Parties”). Lessor and Lessee (or their predecessors-in-interest) entered into that certain Communications Site Lease Agreement dated January 14, 2004 (the “Agreement”) regarding the real property located at Branch Mill Road, Arroyo Grande, CA 93420, commonly known as the Reservoir 4 site. For good and valuable consideration, Lessor and Lessee agree as follows: 1. The Agreement is in full force and effect and neither Lessor nor Lessee is in breach under the terms of the Agreement. 2. Paragraph 1 of the Agreement, “Premises,” is amended in its entirety as follows: Lessor is the owner of a parcel of land (the “Land”) located on Branch Mill Road, Arroyo Grande, California, commonly known as the Reservoir 4 site. The Land is more particularly described in Exhibit A attached hereto and incorporated by reference herein. Lessor hereby leases to Lessee and Lessee leases from Lessor, approximately six hundred forty-five (645) square feet of the Land and all access and utility easements, if any (the “Premises”), described in Exhibit B, attached hereto and incorporated by reference herein. 3. Paragraph 4 of the Agreement, “Term,” is amended in its entirety as follows: The term of this Agreement shall be seven (7) years commencing on the Effective Date of this Amendment (“Commencement Date”) and terminating on the seventh anniversary of the Commencement Date (the “Term”), unless otherwise terminated as provided in paragraph 10 of the Agreement. Lessee shall have the right to extend the Term for three (3) successive five (5) year periods (the “Renewal Terms”) on the same terms and conditions as set forth herein. This Agreement shall automatically be extended for each successive Renewal Term unless Lessee notifies Lessor in writing of its intention not to renew at least sixty (60) days prior to commencement of the succeeding Renewal Term. 4. Paragraph 5 of the Agreement, “Rent,” is amended in its entirety as follows: (a) Within fifteen (15) business days of the Commencement Date and on the first day of each month thereafter, Lessee shall pay to Lessor as rent Three Thousand Two Hundred Thirty Dollars and Thirty-Four Cents ($3,230.34) ^sϬϬϰϮϰͺE>'ͲϲϯϱϵϯͺDͺ,ĂƌĚĞŶŝŶŐEĂƚŝŽŶĂůͺ,ϮϬϭϵͺϭϬϭϵϵϲ         ATTACHMENT 1 Page 203 of 512 2 per month (“Rent”). Rent for any fractional month at the beginning or at the end of the Term or Renewal Term shall be prorated. Rent shall be payable to Lessor at City of Arroyo Grande, 300 East Branch Street, Arroyo Grande, CA 93420; Attention Administrative Services Director. (b) Rent shall be increased on each anniversary of the Commencement Date by an amount equal to three percent (3%) of the Rent for the previous year during the initial Term and all Renewal Terms. (c) Rent payments made after the tenth (10th) day of any month will be considered delinquent, and shall accrue interest at the rate of ten percent (10%) per annum on the delinquent account. If the tenth (10th) day of the month is on a Saturday, Sunday, or holiday, then Lessee has until the next business day for the payment to be received by Lessor. 5. Paragraph 19 is hereby added to the Agreement as follows: Reservoir Maintenance. Lessee recognizes that the primary function of the reservoir upon which some of Lessee’s Facilities are located is to provide water storage for Lessor and its customers. Lessee understands that Lessor may find it necessary from time to time to interrupt Lessee’s use of the Premises for maintenance or repair of the reservoir, and Lessor understands that Lessee’s Facilities are operating 24 hours a day, seven days a week for first responders and other emergency services, including customer services. Lessor shall provide Lessee with at least thirty (30) days prior written notice for non- emergency maintenance and Lessee agrees to take the Lessee’s Facilities out of service for a period not to exceed ten (10) days. If major maintenance and/or repair is required, Lessee agrees to remove Lessee’s Facilities from the reservoir, provided that such removal shall not exceed a period of thirty (30) days. If Lessee is required to take Lessee’s Facilities out of service or to remove Lessee’s Facilities for any period, Lessee, at its sole cost and expense, may use a temporary transmission site or cell on wheels on the Land at a location sufficient to meet Lessee’s cover or engineering needs and approved by Lessor. Rent shall be abated during any maintenance or repair period. 6. Within thirty (30) days of the full execution of this Agreement, Lessee shall pay to Lessor as additional consideration a one-time administrative fee of One Thousand Dollars ($1,000) for City transactional costs associated with preparation and processing of this Agreement. 7. All notices, requests, demands and other communications shall be in writing and shall be effective three (3) business days after deposit in the U.S. mail, certified, return receipt requested or upon receipt if personally delivered or sent via a nationally recognized courier to the addresses set forth below. Lessor or Lessee may from time to time designate any other address for this purpose by providing written notice to the other Party.          Page 204 of 512 3 If to Lessee: If to Lessor: T-Mobile USA, Inc. 12920 SE 38th Street Bellevue, WA 98006 Attn: Lease Compliance/SV00424A City of Arroyo Grande 300 East Branch Street Arroyo Grande, CA 93420 Attn: City Manager 8. Lessor will execute a Memorandum of Agreement at Lessee’s request. If the Land is encumbered by a deed, mortgage, or other security interest, Lessor will also execute a subordination, non-disturbance, and attornment agreement. 9. Except as expressly set forth in this Amendment, the Agreement otherwise is unmodified. To the extent any provision contained in this Amendment conflicts with the terms of the Agreement, the terms and provisions of this Amendment shall control. Each reference in the Agreement to itself shall be deemed also to refer to this Amendment. 10. This Amendment may be executed in duplicate counterparts, each of which will be deemed an original. Signed electronic copies of this Amendment will legally bind the Parties to the same extent as originals. 11. Each of the Parties represents and warrants that it has the right, power, legal capacity and authority to enter into and perform its respective obligations under this Amendment. Lessor represents and warrants to Lessee that the consent or approval of a third party has either been obtained or is not required with respect to the execution of this Amendment. 12. This Amendment will be binding on and inure to the benefit of the Parties herein, their heirs, executors, administrators, successors-in-interest and assigns. [Signatures on following page.]          Page 205 of 512 4 IN WITNESS, the Parties execute this Amendment as of the Effective Date. Lessor: City of Arroyo Grande, a municipal corporation formed under the laws of the State of California By: Caren Ray Russom, Mayor Date: Attest: By: Jessica Matson, City Clerk Approved as to Form: Timothy J. Carmel City Attorney Lessee: T-Mobile West LLC, a Delaware limited liability company By: Print Name: Title: Date: T-Mobile Contract Attorney as to form dDK^ŝŐŶĂƚŽƌLJ>ĞǀĞů͗>Ϭϰͬ>Ϭϱ ^sϬϬϰϮϰͺE>'ͲϲϯϱϵϯͺDͺ,ĂƌĚĞŶŝŶŐEĂƚŝŽŶĂůͺ,ϮϬϭϵͺϭϬϭϵϵϲ AJ Digitally signed by AJ Date: 2022.08.16 08:38:02 -04'00'                   Page 206 of 512          Page 207 of 512          Page 208 of 512          Page 209 of 512          Page 210 of 512 EXHIBIT B The Premises consist of those areas described/shown below and where Lessee's communications antennae, equipment, cables and utilities occupy Lessor's Property. The Premises and the associated utility connections and access, including easements, ingress, egress, dimensions, and locations as described/shown below, are approximate only and may be adjusted or changed by Lessee at the time of construction to reasonably accommodate sound engineering criteria and the physical features of Lessor's Property.          Page 211 of 512 COMMUNICATIONS SITE LEASE AGREEMENT This Communications Site Lease Agreement (Ground) (Agreement) is entered into this /1M day of January, 2004, between PACIFIC BELL WIRELESS, LLC, a Nevada limited liability company doing business as CINGULAR WIRELESS ("Lessee"), and CITY OF ARROYO GRANDE, a municipal corporation formed under the laws of the State of California ("Lessor"). For good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 1. PREMISES. Lessor is the owner of a parcel of land (the "Land") located on Branch Mill Road, Arroyo Grande, California, commonly known as the Reservoir 4 site. The Land is more particularly described in Exhibit A annexed hereto. Lessor hereby leases to Lessee and Lessee leases from Lessor, approximately five hundred ten (510) square feet of the Land and all access and utility easements, if any, (the "Premises") described in Exhibit B annexed hereto. 2. USE. The Premises may be used by Lessee for reasonable activities in connection with the provision of mobile/wireless communications services. Lessee shall, at Lessee's sole cost and expense, make application for and obtain all licenses, permits and any and all other necessary approvals that may be required for Lessee's intended use of the Premises. Lessee is aware that Lessee must obtain a conditional use permit from the City of Arroyo Grande and comply with conditions imposed thereon as a condition precedent to occupancy of the Premises. 3. TESTS AND CONSTRUCTION. Lessee shall have the right at any time,following the full execution of this Agreement, to enter upon the Land for the purposes of making appropriate engineering and boundary surveys, inspections, soil test borings, other reasonably necessary tests (collectively, Tests"). Lessee shall comply with the repair provisions of Paragraph 15 below during and after all Tests and related work. ATTACHMENT 2 Page 212 of 512 4. TERM. The term of this Agreement shall be five (5) years commencing on the date Lessee obtains a conditional use permit as specified in Paragraph 2 above (Commencement Date) and terminating on the fifth anniversary of the Commencement Date (the Term) unless otherwise terminated as provided in Paragraph 10. Lessee shall have the right to extend the Term for three (3) successive five (5)year periods (The Renewal Terms)on the same terms and conditions as set forth herein. This Agreement shall automatically be extended for each successive Renewal Term unless Lessee notifies Lessor of its intention not to renew prior to commencement of the succeeding Renewal Term. 5. RENT. a) Within fifteen (15) business days of the Commencement Date and on the first day of each month thereafter, Lessee shall pay to Lessor as rent Fifteen Hundred Dollars 1,500.00) per month ("Rent"). Rent for any fractional month at the beginning or at the end of the Term or Renewal Term shall be prorated. Rent shall be payable to Lessor at City of Arroyo Grande, P.O. Box 550, 214 East Branch Street, Arroyo Grande, CA 93421; Attention: Financial Services Director. b) Rent shall be increased on each anniversary of the Commencement Date by an amount equal to three percent (3%) of the Rent for the previous year during the initial Term and all Renewal Terms. c) Rent payments made after the tenth (10')day of any month will be considered delinquent, and shall accrue interest at the rate of ten percent (10%) per annum on the delinquent account. If the tenth (10') day of the month is on a Saturday, Sunday or holiday, then Lessee has until the next business day for the payment to be received by Lessor. d) Within thirty(30)days of the full execution of this Agreement, Lessee shall pay to Lessor as additional consideration a one time administrative fee of Two Thousand Dollars ($2,000.00)for City transactional costs associated with preparation and processing of this Agreement. 6. FACILITIES; UTILITIES; ACCESS. a) Subject to the terms and conditions herein, Lessee has the right to erect, maintain and operate on the Premises radio communications facilities, utility lines, transmission lines, air conditioned equipment shelter(s), electronic equipment, radio transmitting and receiving antennas,supporting equipment and structures thereto("Lessee Facilities"). In connection therewith, Lessee has the right to do all work necessary to prepare, maintain and alter the Premises for Lessee's business operations and to install i 2 Page 213 of 512 transmission lines connecting the antennas to the transmitters and receivers. All of Lessee's construction and installation work shall be performed at Lessee's sole cost and expense and in a good workmanlike manner. Except as otherwise specified herein,title to the Lessee Facilities shall be held by Lessee. All of the Lessee Facilities shall remain Lessee's personal property and are not fixtures. Lessee shall remove all the Lessee Facilities at its sole expense on or before the expiration or earlier termination of this Agreement; provided, Lessee repairs any damage to the Premises caused by such removal. Additionally, upon the expiration or earlier termination of this Lease, Lessee shall surrender the Premises to Lessor in good condition, less ordinary wear and tear. Should Lessee fail to remove the Lessee Facilities from the Land within thirty (30) days of the expiration or earlier termination of this Agreement, Lessor may remove and store the Lessee Facilities at Lessee's sole cost and expense. If Lessee does not claim the Lessee Facilities, and provided that Lessor has given Lessee any third party financing entity sixty 60) days prior written notice, the Lessee Facilities shall be deemed abandoned. Lessee shall post a Twenty-Five Thousand Dollars ($25,000) surety bond for removal of the Lessee Facilities. The aforementioned surety bond shall be in effect for the initial five (5) year Term and all Renewal Terms of this Agreement. Lessee agrees to increase the amount of the bond for each Renewal Term in the same proportion that rent increases in said Renewal Term. b) Lessee shall pay for the electricity and all other utility services it consumes or uses in its operations at the rate charged by the servicing utility company. Any electrical upgrade, if necessary, shall be at Lessee's sole cost and expense. Lessee shall have the right to draw electricity and other utilities from the existing utilities on the Land or obtain separate utility service from any utility company that will provide service to the Land including a standby power generator for Lessee's exclusive use.) c) Lessee, Lessees employees,agents, subcontractors, lenders and invitees shall have access to the Premises without notice to Lessor twenty-four(24) hours a day, seven 7) days a week, at no charge. During the Term of the Agreement, Lessor grants to Lessee, and its agents, employees, contractors,guests and invitees, a non-exclusive right and easement for pedestrian and vehicular ingress and egress across that portion of the Land described in Exhibit B. d) Lessor shall maintain all access roadways from the nearest public roadway to the Premises in a manner sufficient to allow pedestrian and vehicular access at all times under normal weather conditions. Lessor shall be responsible for maintaining and repairing such roadways, at its expense, except for any damage caused by Lessee's use of such roadways. e) Prior to commencing construction of Lessee's Facilities, Lessee shall obtain Lessor's approval of Lessee's work plans. 3 Page 214 of 512 7. (NTERFERENCE. a) Lessee shall construct, repair and operate the Lessee Facilities in such a manner that will not cause interference to Lessor including, but not limited to, Lessor's re- broadcaster for its fire, police and other public safety departments, and other lessees or licensees of the Land. All operations by Lessee shall be in compliance with all Federal Communications Commission (`FCC") requirements and all applicable laws. b) Subsequent to the installation of the Lessee Facilities, Lessor shall not permit its lessees or licensees to install new equipment on the Land or property contiguous thereto owned or controlled by Lessor, if such equipment will cause interference with Lessee's operations. Such interference shall be deemed a material breach by Lessor. In the event interference occurs, Lessor agrees to take all reasonable steps necessary to eliminate such interference, in a reasonable time period. Notwithstanding anything herein to the contrary, in the event Lessor fails to comply with this paragraph, Lessee's sole remedy is to terminate this Agreement. 8. TaxES. If personal property taxes are assessed, Lessee shall pay any portion of such taxes which are attributable to the Lessee Facilities. Except as provided immediately below, Lessor shall pay all real property taxes attributable to the Land. Lessee shall reimburse Lessor for any increases in real property taxes which are assessed as a result of Lessee's improvement to the Land. As a condition of Lessee's obligation to pay such increases, Lessor shall first provide to Lessee the documentation from the taxing authority indicating th e increase is due to Lessee's improvements. 9. WAIVER OF LESSOR'S LIENS. a) Lessor waives any lien rights it may have concerning the Lessee Facilities which are deemed Lessee's personal property and not fixtures, and Lessee has the right to remove the same at any time without Lessor's consent. b) Lessor acknowledges that Lessee has entered into a financing arrangement including promissory notes and financial and security agreements for the financing of the Lessee Facilities (the" Collateral")with a third party financing entity (and may in the future enter into additional financing arrangements with other financing entities). In connection therewith, Lessor (i) consents to the installation of the Collateral; (ii) disclaiming any interest in the Collateral, as fixtures or otherwise, and (iii)agrees that the Collateral shall be exempt from execution,foreclosure, sale, levy, attachment, or distress for any Rent due or to become due and that such Collateral may be removed at any time without recourse to legal proceedings. 4 r Page 215 of 512 10. TERMINATION. This Agreement may be terminated on thirty (30) days prior written notice as follows: i) by either party upon a default of any covenant or term hereof by the other party, which default is not cured within sixty (60) days of receipt of written notice of default, provided that the grace period for any monetary default is ten (10)days from receipt of notice; (ii) by Lessee if it does not obtain or maintain any license, permit or other approval necessary for the construction, and operation of the Lessee Facilities; or (iii) by Lessee if Lessee is unable to occupy and utilize the Premises due to an action of the FCC, including without limitation, a take back of channels or change in frequencies; or (v) by Lessee if Lessee determines that the Premises are not appropriate for its operations for economic or technological reasons, including, without limitation, signal interference. Should this Agreement be terminated pursuant to this Paragraph 10, Lessee shall pay the Rent due up to the effective date of termination. 11. DESTRUCTION OR CONDEMNATION. If the Premises or Lessee Facilities are damaged, destroyed, condemned or transferred in lieu of condemnation, Lessee may elect to terminate this Agreement as of the date of such damage, destruction, condemnation or transfer in lieu of condemnation, by giving notice to Lessor no more than forty-five (45) days following the date of such damage, destruction, condemnation or transfer in lieu of condemnation. 12. INSURANCE. Lessee shall maintain the following insurance: (1) Commercial General Liability with limits of$5,000,000.00 per occurrence, covering Lessee's use, occupancy and operations on the Premises; (2)Automobile Liability with a combined single limit of$2,000,000.00 per accident; (3) Workers Compensation as required law; and (4) Employer's Liability with limits of $1 ,000,000.00 per occurrence. Lessee shall provide to Lessor a certificate of insurance evidencing the coverage required by this paragraph prior to entering the Land. Each policy of insurance shall be endorsed to state that it shall not be suspended, canceled or reduced in coverage or in limits except after thirty (30)days prior written notice has been given to Lessor. 13. ASSIGNMENT AND SUBLETTING. Lessee may assign this Agreement or sublet the Premises or any portion thereof to any entity, subject to Lessor's prior written consent and the assignee assuming all of Lessee's obligations•herein. Under any such assignment or subletting, Lessee shall not be relieved of any future performance, liabilities, or obligations under this Agreement. Lessor may assign this Agreement upon written notice to Lessee, subject to the assignee assuming all of Lessor's obligations herein, including, but not limited to, those set forth in Paragraph 9 ("Waiver of Lessor's Lien") above. This Agreement shall run with the property 5 Page 216 of 512 i and shall be binding upon and inure to the benefit of the parties, their respective successors, personal representatives, heirs and permitted assigns. Notwithstanding anything to the contrary contained in this Agreement, Lessee may assign, mortgage, pledge, hypothecate or otherwise transfer without notice or consent its interest in this Agreement to any financing entity, or agent on behalf of any financing entity to whom Lessee (i) has obligations for borrowed money or in respect of guaranties thereof, (ii) has obligations evidenced by bonds, debentures, notes or similar instruments, or (iii) has obligations under or with respect to letters of credit, bankers acceptances and similar facilities or in respect of guaranties thereof. 14. WARRANTY OF TITLE AND QUIET ENJOYMENT. Lessor warrants that: (i)Lessor owns the Land in fee simple and has rights of access thereof and the Land is free and clear of all liens, encumbrances and restrictions, except as disclosed by the public records: (ii) Lessor has full right to make and perForm this I Agreement; and (iii) Lessor covenants and agrees with Lessee that upon Lessee paying the Rent and observing and performing all of the terms, covenant and conditions on Lessee's part to be observed and performed, Lessee may peacefully and quietly enjoy the Premises. I 15. REPAIRS. I Lessee shall be required to make any repairs to the Premises or Land necessitated by reason of Lessee's action or inaction, including, but not limited to, Lessee's tests and/or Lessee's construction, use, operation and maintenance of the Lessee Facilities. Except as set forth in Paragraph 6(a) above, upon expiration or termination hereof, Lessee shall restore the Premises to the condition in which it existed upon execution hereof, reasonable wear and tear excepted. 16. HAZARDOUS SUBSTANCES. Lessee agrees that it will not use, generate, store or dispose or permit the use, generation, storage or disposal of any Hazardous Material on, under, about or within the Land in violation of any law or regulations. To the best of Lessor's knowledge without investigation, Lessor represents, warrants, and agrees (1) that neither Lessor nor, to the best of Lessor's knowledge without investigation, any third party has used, generated, stored or disposed of, or permitted the use, generation, storage or disposal of, any Hazardous Material (defined below)on, under, about or within the Land in violation of any law or regulation, and (2) that Lessor will not, and will not permit any third party to use, generate, store or dispose of any Hazardous Material on, under, about orwithin the Land in violation of any law or regulation. Lessor and Lessee each agree to defend, indemnify and hold harmless the other and the other's partners, affiliates, agents and employees against any and all losses, liabilities, claims and/or costs(including reasonable attorneys=fees and costs) arising from any breach of any representation, warranty or agreement contained in 6 Page 217 of 512 i this paragraph. As used in this paragraph, "Hazardous Material" shall mean petroleum or any petroleum product, asbestos, any substance known by the state in which the Land is located to cause cancer and/or reproductive toxicity, and/or any substance, chemical or waste that is identified as hazardous,toxic or dangerous in any applicable federal, state or local law or regulation. This paragraph shall survive the termination of this Agreement. 17. LIABILITY AND INDEMNITY. a) Lessee shall exonerate, hold harmless, indemnify, and defend Lessor and its directors, officers and employees from and against any and all suits, actions, judgments, legal or administrative proceedings, arbitrations, claims, demands, causes of action, damages, liabilities, interest, attorneys'fees, fines, penalties, losses, costs and expenses of whatsoever kind or nature (collectively, "Claims") arising out of or resulting from: 1) operations or performance under this Agreement by Lessee or its officers, directors, employees, contractors, subcontractors, lenders or agents, including,without limitation,the use, occupancy or enjoyment of the Premises by Lessee or any work, activity or other things allowed or suffered by Lessee or Lessee's directors,officer, employees,contractors, subcontractors, lenders or agents, invitees or lenders; or 2) any injury to or the death of any person or any damage to property, if such injury, death or damage arises out of or is attributable to or results from the acts or omissions of Lessee or its directors, officers, employees, contracto s, subcontractors, lenders or agents, including,without limitation,the use, occupancy or enjoyment of the Premises by Lessee or any work, activity or other things allowed or suffered by Lessee or Lessee's directors, officers, employees, I contractors, subcontractors, lenders or Agents on the Premises. Neither the expiration or earlier termination of this Agreement nor completion of the acts to be performed under this Agreement shall release Lessee from its obligation to indemnify, as to any Claim, so long as the event upon which the Claim is predicated shall have occurred prior to the effective date of any such expiration or earlier termination or completion and arose out of or was in any way connected with performance or operations under this Agreement by Lessee, its directors, officers, employees, contractors, subcontractors, lenders or agents or any one of them. 18.MISCELLANEOUS. a) This Agreement constitutes the entire agreement and understanding befinreen the parties, and supersedes all offers, negotiations and other agreements concerning the subject matter contained herein. Any amendments to this Agreement must be in writing and executed by both parties. b) If any provision of this Agreement is invalid or unenforceable with respect to any party, the remainder of this Agreement or the application of such provision to persons other than those as to whom it is held invalid or unenforceable, shall not be affected and each provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. 7 Page 218 of 512 c) All of the terms and conditions of this Agreement shall be binding on and inure to the benefit of the successors and permitted assignees of the respective parties. d) Any notice or demand required to be given herein shall be made by certified or registered mail, return receipt requested, or reliable overnight courier to the address of the respective parties set forth below. LESSOR:LESSEE: City Manager Pacific Bell Wireless, LLC City of Arroyo Grande 6100 Atlantic Boulevard P. O. Box 550 MailCode GAN02 214 East Branch Street Norcross, GA 30071 Arroyo Grande, CA 93421 Attn: Nefinrork Real Estate Administration With Copy to: Pacific Bell Wireless, LLC 3345 Michelson Drive, Suite 100 Irvine, CA 92612 Attn: Legal Department Lessor or Lessee may from time to time designate any other address for this purpose by written notice to the other party. All notices hereunder shall be deemed received upon actual receipt. e) This Agreement shall be governed by the laws of the State of California. f) Upon request either party may require that a Memorandum of Lease be recorded confirming the (i) Lease commencement, (ii) expiration date of the Term, and (iii) the duration of any Renewal Terms. g) Lessee, at its sole cost, may obtain title insurance on its interest in the Land, Lessor shall cooperate by executing documentation required by the title insurance company. h) In any case where the approval or consent of one party hereto is required, requested or otherwise to be given under this Agreement, such party shall not unreasonably delay or withhold its approval or consent. i) All Riders and Exhibits annexed hereto form material parts of this Agreement. 8 Page 219 of 512 j) This Agreement may be executed in duplicate counterparts, each of whichshallbedeemedasoriginal. IN WITNESS WHEREOF, the parties have executed this Agreement as of thedatefirstabovewritten. LESSOR: LESSEE: CITY OF ARROYO GRANDE, PACIFIC BELL WIRELESS, LLC a Nevada limited liability company To vY M. FE At, Mayor By: GSM Facilities, LLC, its sole member By: CINGULAR WIRELESS, LLC ATTEST: its agent By: KELLY ETM E HARLE RANEK Director of Administrative Services/ Regional Director, Deputy City Clerk Network Deployment APPROVED AS TO CONTENT:ATTEST WITNESS: STEDAMS, City Manager Date:_T it/L i APPROVED AS TO FORM: Tinno Y.1. ARM , City Attorney 9 Page 220 of 512 EXHIBIT A LEGAL DESCRIPTION OF LESSOR'S PROPERTY(LAND) Lessor's Property (Land) of which Premises are a part is legally described as follows: APN: 007-611-016 All of that certain real property located in the County of San Luis Obispo, State of California, being more particularly described as follows: THAT PORTION OF LOT 91 OF THE MAP OF THE RANCHOS CORRAL DE PIEDRA PISMO ANDBOLSADECHEMISAL,IN THE CI"fY OF ARROYO GRANDE,COUNTY OF SAN LUIS OBISPO,STATE OF CALIFpRNIA,AS PER MAP FILED IN BOOK A,PAGE 65 OF MAPS,IN THE OFFICE OFTHECOUN7YRECORDEROFSAIDCOUN7Y,DESCRIBED AS FOLLOWS: BEGINNING AT THE MOST SOUTHERLY CORNER OF THE LAND DESCRIBED IN THE DEED TOAMASAW. DIXSON RECORDED IN BOOK 15, PAGE 302 OF DEEDS,RECORDS OF SAID COUMY,MARKED BY A POST SET BY A F.PARSONS IN FEBRUARY 1892, PRESEMIY MARKED BY AN 11/4 INCH DIAMETER PIPE TAGGED RCE 6923 AS SHOWN ON THE MAP FILED IN BOOK 8,PAGE120OFRECORDOFSURVEYSINSAIDCOUNTYRECORDERSOFFICE. THENCE NORTH 54°EAS7'664.00 FEET TO A POINT, FROM WHICH THE MOSf EASTERLYCORNEROFSAIDLANDOFDIXSONBEARSNORTH54°EAST 537.30 FEET,MORE OR LESS,MARKED BY A POST ESTABLISHED BY A.F. PARSONS,IN FEBRUARY, 1892,PRESENTLY MARKEDANOLDFENCECORNER,SAID POINT BEING THE TRUE POINT OF BEGINNING. THENCE AT RIGHT ANGLES SOUTH 36°EAST'240.00 FEET TO A POINT. THENCE AT RIGHT ANGLES NORTH 54°EAST 27Z,00 FEET TO A POINT. THENCE AT RIGHT ANGLES NORTH 36°WEST 240.00 FEEZ'TO A POINT, THENCE SOUTH 54°EAST 272,00 FEET TO THE TRUE POINT OF BEGINNING. APN: 007-611-016 PAPCC(. :: 11n eascmcn• ovcr et1,,t pnr[ion uI l,t 9] pr the raap oF the 4anchos Co=de Picdra, Pisno ncl Ltc+25 cic C:hc;m{sn1 { th City o£ Azroyo Gzande,Count o San i.uis obi o, Sta e oE C11 i6a=ya, as per m'ap filed inDoo F., Page 65 of t-la,s in the (r'£ice of khc c:ounty Recarder of saidCounty, for pu52ic itility puz,oses a,cc:iEica2ly including .,ater tranmissionlir.es and ,ee s. cooct,, to athc;r vtCh al•l necessary appurte-nanees theceto boCh at,ve a ncl l elo qrouncl levtl, in.cluding the righttoimprove, repnir n. rnZintairi saicl ro cl+ay snd water trnnsmissipn 1 t3eginning at an lni 2f: Oltlt ln thc rouchi:t-ly right of way line ofL[anCh Hi I1 Ro?d 'ccordi tic7 to thc dcr.l to ehe County of Sa Luis Ot isFror. A. t. Di;son recorclec9 in Eloc,k R8 e° I.eecls ot Puge 4U5 fn'said County Recorder's c ffic::, +•rl icn :nqie ,c,int is on the rlorCheaster2ylia of the land dcscribcd in thi: dcad to ninr,sa W_ Diy.sbn recorde in doo!c I5, P y J02 oE De c s, R-t:ords E s<id C'ounty, and said anq3e oint beinq oc,posiLc thit oi t n r.c t ;s "station, 40-22" (sic) Nhi.ch oa [hc Northcrly r:idc of sr id ro:<l, :,l o frum c id anqle point an l, i tliametez pipa t g:crcl [.5 375C trc,r rtc,rrli 1't• a5' a9" East 26.26 feet Jistant: i Page 221 of 512 EXHIBIT A LEGAL DESCRIPTION OF LESSOR'S PROPERTY LAND Phence Slong said •Tfortl1c soirtts ll c of tl lzsnd oE aixson South 36° 5g'• East 31.00 feet. to a P oint Thence leaving sai$ line North 26e 2a• q'1" East 3D_88. feet to a p on the Southerly rxght of ray line of s i 42antest132..49afeeC distar. the p int of beginnin9 bears South 84° 58' st 32.49 feet Thence. a ong'said ri9ht oE w y line Soutl, B4° 58' 42" to tt e Point of Beginning- PARCEL C= rater n easement far p-lic utility purposes s ecifically including tiansmission .11nes' :nJ acce5s ro:ic]s to}t cr,with all necess ry nPP?= ir d m intain srid ro d+aY ana water .trnnsmission e ri5 tenances ttiereto t oth above :snd beloa yrouncl lev l, includofgparts oi to 'imptove, rep. lines 10 feet +icic ovez that Ppismonancl BolsaldefChemisal-, 3.s1 the Cii of S n Luis Obis o, State of California, as thc Ranchos Corral cic Piedra, o£ ArroYa Grande, CountY , a e 65 of *:ps, in the Office of• the Cour t: per map fiLed in Dook A. 9 Recozder of snid CountY• described as follous: Page 993 gQgi.nning at n1iL_`n rederickeand r+iPeetec:orledcin Book 1943ribed in t d^_ed to verno of OEfici.aT. Recorcls, it1 said County Iteeorder' s =fiCC,. being reCited as stake L' vo•' 1 tlierein: the Southues crly line oE said Parcel v.A. North 34° 13 Tltencc alon9 mor or less, to the TRUE PO.INT OF Q NN NG• fXO p1e t 1496.48 feet, orner of t11e, lond described_ iT' records o ts: hzch the mosc Southerly j02 of. Deeds. a post T.masa ,. Dixson r corded in IIook 15, 9 l' by ; CountY bears e ortr 74' 13 west ?00.00 fcet clistant marked by 1B92. P=esentlY 7''' =iled i: e5tabliGhP :';' • 1. F_ r c'o c.cl (: CErG923 as shown on the maP Uffi 1 1/4 inch di metcr pir y9 ' uook 8 , Po9' :2a:"of °• crorcls oE Survcy i.n :aid County Recbrd.:t = Th nce Notth 34° '13' .rst 7Q0'00 .`.cct to sai most Southerly cozner Che land of Di.:.sort: I>st 6t;4.0 fcct: to a <, intofrom +hich the rnostiEY2 7hencc t o=Ch 54°189riJofticsonbe:.rs Noreh Sn L•ast 537.0 feet, of s; st blishr,d hy n., '. r rsons in F bruary. corner i,st c- l ss, marked bY t 1 f.encc corncr: pr sentl:y m rkc<7 by Thcnce at ri ht tigl South 36° l:ast !0- f.eet to a point; t t i c l` jc utli 54° West G54_31 feet tfzomisaid S uthls Thence t i h i,;nt 10.00 icet *lorthe.istcrl,y d!s111e1 . nJ[C'1 V.1. : esterly linc oC alor. saicl I.r licl linC : outh 4• 13' 1:ast 690:31 feet t a Thence 4 47' point froi -= hich t2ie 'I'cue i'oint f IIe,yinning bears outh 55' e" 10.0 fect dist ht: intti-ng• 1•}ence South 5° 4 t est 10.00 f.cct to the True Point of Beq Page 222 of 512 EXHIBIT A LEGAL DESCRIPTION OF LESSOR'S PROPERTY(LAND) pARCEL D: yin easement for publir utility purposes specifically including- water tzansmission iis es and access roads, together rrith 11 necessary appL tenances thazeto beth above and belaN yround level, including the rig to improve, repair'and maintain said road+ay and wateF transmission lines over that portion of Lot 91 of tt e map of the Ranchos Corral d ricdra, Pismo and nols. de Chemisal, ici thc City o Ar.royo Gzande, Cc of San I.uis Obispo, Stat of C 11€otni. s p r map fi ga in Sook A. Page 65 of Maps in the OfFice o the County Recorder o.:sai.d County, included +ithin a strip oP land• 25 eet wide ].yi'ng 12.50•Peet,on eacr side of the follo.risig describecl Centerlines Heyinning at the most Southerly •corne r of tt e lanc3 describe3 in the deed to Rmasa SV_ Dix on recorded in IInok 15, Paqe 302 oF Deeds, recor of said County, marked Dy a post• set by ). F_ Parsons in Februsry, lE presently marked by an 1 1/4 inch 8iamrter pipe• ta,qged RCE 6923 as sho.rn on the rnap fil d in IIook B, ragc 12O of Records of.• Survey 3.n sa County Recorder's Office: Thence No,:h S4' ast 478.52 fc nt to . point, ft'om uhici the mosG Easterly corner of said land of pixson bears North 54° East ?22.7E fe more or less, msrked by a post establishecl by R. F. Parsons i.n Febru 1892. Prasently m rked by an olcl Eencc orncr, snid point being the TRUE POZNT OF IIFCINt1It3G: y Thet ce South 44' O1' 00" est 7.44 fe C to a point;' I Thence con inuiny South+esterly lony a `tang.ent• curve concave Easter: w3th a radiu of 70;00 fcet throi gh a ca:n ral angle 'oE 87.° 3Q' 03" a: i 3rc distan e- oE 207.02 fec to a point; Thence Sout h 43° 3'' S5" East 94 :G7 lec:t to a point; Thence contir.uing >outhca te:ly long . tangc:nt curve concave Northe' with a radius of 150.Un' f c thrc+uyti a ccntr l anqle of 117° 39' S7" an rc dis ancc of 348.05 fcet tcr a F+oinl•: • t'hence L orth 28° 45' us" F.a t 95.J3 fee[ to a oint on the Southwest line of Pazcel A hcrein Jescribed. 7'lic sidclincs o£ tliis e:+scincnt cF,all be extended or shortened as nec ary co tcrnincte Nort:+estrriy ot th Southcasterly line oE said la of Uixson a d South ast rly at Che S uth+ester2y line of Parce2 A 2ierei.n descriUed. i Page 223 of 512 EXHIBIT A LEGAL DESCRIPTION OF LESSOR'S PROPERTY(LAND) PARCEL E= , pn .easement for• public u'ii,ity aurposes specifically i,cluding Water Cransmission lines anu access roads, together with all ecessaty appu tenances thereto both abova and below ground level, inc'Iuding the rig: to improve, repaiz and r.aintai n said roadway and water transmission lines over that porticri o Lot 91 of the map of. the Ranchos Coxral de Piedra, t'ismo and Bolsa• de Chemisal, i.n the Ci.ty of Azroyo Grande, County o£ San Luis Obispo, State o•f California, as per map filed in Book A. Page 65 of.iaps in che Office o£ the County Recordar of said County, included within a strip of land 20 feet «ide lying I.U-00 •feet on each side of the fcllowinq clescribed centerline: 8eqinning t3t e pzXS n recordedcinnBookf. lS,ePaged302 of Deeds, recorc deed to Amas of sai.d County Triarked by a post set by .n. F. L'axsoestan edbRCE 6923H9 pxesent2y marked bY iled/in19oo,k H,mpaqe 1.20no 1Records o£ Suzvey i as shown on the map said County Recorder's OfFice; Thence North SA° East 478.52 feet to a point, called herei.n, o= Convenience only, pOZNT A; Thence continvinq t]orth said lan37of.Di cson mark d by aeposttsethbyrewstEasterlycoraerok., csentl marked b an oI.d Fence p_ F., Parsons i.ri February, 1892, pX Y CoXner; Thence North 36°S1'S8" West i99•39 fcet,•more or less, to the T UE POINT lineGoE,Branch Mi.tl Itoad describedlin thetdeed tohtheyCounty of o r+ay San Luis Obispo Exom A. •l. D.'.xson recorded in Dook 88 of Detds at aqe A85, recor8s of said County i:ears North 3G•51'S8" west 19.6Z feet dS.stant, which angle point •i•: on tltc NortheasterJ.y line of thepa ed302 cicscribed iri th°_ deed to nmc1 3 W'nd"s°idrznqleepoi. ntB skopoos te tbat of Deeds,R2c:=d5 0£ sni.d Cou'ty. . si8e of oint noted as "station 40-22"• SOint~ancl inchndiametertpipeYtaqqed • said zoad, a?so from s3id angle p LS 375G bears .torth 12°45'49" East 2G. fcct distant; Thence crossir.g said land of Dixson along said centerline South 26° 2B pq" Ft2st 6.40 feet to 'a poi.nt; . Thenc co,ntinuiilg Soutnuesterly alonq a tangent curve concave North-wesGerly r+ith a radius of 25U-00 Ee t through a central angle of 20° 20' 33" an arc distance oE 08.76 zcet to a point; Thence South 46" 38' 37" t cst h6.83 fect to a point; Theoce South 39° 35' 3>>" t•est B7.75 fcet to a pofnt; , , l't e:cc Sou.th 42° 12' J'i" lvC,st G4.91 fec.t tn a point: Page 224 of 512 EXHIBIT B DESCRIPTION OF PREMISES The Premises consist of those areas described/shown below and where Lessee's communications antennae, equipment, cables and utilities occupy Lessor's Property. ThePremisesandtheassociatedutilityconnectionsandaccess, including easements, ingress, egress, dimensions, and locations as described/shown below, are approximate only and may be adjusted or changed by Lessee at the time of construction to reasonably accommodate sound engineering criteria and the physical features of Lessor's Property. See Site Plan dated 12/16/03 VY-465-01 A final drawing, Site Plan, or copy of a property survey substantially depicting the above will replace this Exhibit "B" when initialed by Lessor 1. This Exhibit may be replaced by a land surveyor Site Plan of the Premises once it is zreceivedbyLessee. 2. Setback of the Premises from the Lessor's boundaries shall be the distance required by the applicable governmental authorities. 3. Width of access road shall be the width required by the applicable governmental rauthorities, including police and fire departments. 4. The type, number and mounting positions and locations of antennas and transmission lines are illustrative only.Actual types, numbers, mounting positions may varyfromwhatisshownabove. j t h; Page 225 of 512 1 Item 8.e. ACTION MINUTES REGULAR MEETING OF THE CITY COUNCIL/SUCCESSOR AGENCY TO THE DISSOLVED ARROYO GRANDE REDEVELOPMENT AGENCY September 13, 2022, 6:00 p.m. Hybrid City Council Chamber/Virtual Zoom Meeting 215 East Branch Street, Arroyo Grande Council/Board Members Present: Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, Council/Board Member Storton Council/Board Members Absent: Council/Board Member Barneich Staff Present: City Clerk Jessica Matson, City Attorney Timothy Carmel, City Manager Whitney McDonald, Assistant City Manager/Public Works Director Bill Robeson, Administrative Services Director Nicole Valentine, Community Development Director, Police Chief Michael Martinez, Planning Manager Andrew Perez, Associate Planner Patrick Holub, Police Commander Dave Culver Given the recent increase in COVID-19 cases in San Luis Obispo County, and in compliance with Assembly Bill (AB) 361, which allows for a deviation of teleconference rules required by the Ralph M. Brown Act, this meeting was held by teleconference. _____________________________________________________________________ 1. CALL TO ORDER Mayor/Chair Ray Russom called the Regular City Council/Successor Agency to the Dissolved Arroyo Grande Redevelopment Agency Meeting to order at 6:00 p.m. 2. ROLL CALL City Clerk Matson took roll call. 3. MOMENT OF REFLECTION 4. FLAG SALUTE Felix Esparza, Latino Outreach Council, led the flag salute. Page 226 of 512 2 Item 8.e. 5. AGENDA REVIEW Mayor/Chair Ray Russom noted that Item 9.b. will be heard before 9.a. and 11.a., and Council Communications will be heard before the Public Hearing items. 5.a Closed Session Announcements None. 5.b Ordinances read in title only Moved by Mayor/Chair Ray Russom Seconded by Council/Board Member Storton AYES (4): Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (1): Council/Board Member Barneich Passed (4 to 0) 6. SPECIAL PRESENTATIONS 6.a Update Regarding Countywide COVID-19 Efforts City Manager McDonald provided a brief update on COVID-19 including available booster vaccines and testing sites. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.b City Manager Communications City Manager McDonald provided information regarding the City's summer concert series, the Elm Street Inclusive Playground groundbreaking event; and the first Joint City Council meeting regarding the Central Coast Blue Project. Assistant City Manager/Public Works Director Robeson provided information regarding awards received for the Bridge Street Bridge Rehabilitation Project. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. Receive correspondence/comments as presented by the City Manager and Provide direction, as necessary. 6.c Honorary Proclamation Recognizing September 15-October 15, 2022 as "National Hispanic Heritage Month" Mayor/Chair Ray Russom read the Honorary Proclamation recognizing September 15 - October 15, 2022 as "National Hispanic Heritage Month." Felix Esparza, Latino Outreach Council, accepted the proclamation. The Latino Outreach Council and Mexican Consulate presented a Certificate of Recognition to the Council for highlighting the contributions made by the Latino Page 227 of 512 3 Item 8.e. and Mexican community in the city of Arroyo Grande and enhancing and connecting the diverse and multi-racial and multi-cultural mosaic of cultures during Hispanic Heritage Month. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.d Introduction of Police Commander Culver Police Chief Martinez introduced Police Commander Culver, and highlighted his educational and professional background. 6.e Update on Active Shooter Drill Police Commander Culver provided information regarding the recent multi-jurisdictional Active Shooter Drill and responded to questions from Council/Board. Mayor/Chair Ray Russom invited public comment. Speaking from the public was Ben Franco and Rachelle Krelle. No further public comments were received. No action was taken on this item. 7. COMMUNITY COMMENTS AND SUGGESTIONS Mayor/Chair Ray Russom invited public comment. Speaking from the public was Jeff Edwards. No further public comments were received. 8. CONSENT AGENDA Mayor/Chair Ray Russom asked the Council/Board if there were any questions or any items to be pulled from the consent agenda for further discussion. Staff responded to Council questions regarding Item 8.j. Mayor/Chair Ray Russom invited public comment. No public comments were received. Moved by Council/Board Member Storton Seconded by Council/Board Member Paulding Approve Consent Agenda Items 8.a. through 8.m., with the recommended courses of action. AYES (4): Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (1): Council/Board Member Barneich Passed (4 to 0) 8.a Consideration of Cash Disbursement Ratification Ratified the listing of cash disbursements for the period of August 1 through August 15, 2022. 8.b Consideration of Statement of Investment Deposits Received and filed the attached report listing investment deposits of the City of Arroyo Grande as of July 31, 2022, as required by Government Code Section 53646(b). Page 228 of 512 4 Item 8.e. 8.c Consideration of Adoption of Resolution Approving the Last and Final Recognized Obligation Payment Schedule for the Successor Agency to the Arroyo Grande Redevelopment Agency Adopted a Resolution entitled: "A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY TO THE DISSOLVED ARROYO GRANDE REDEVELOPMENT AGENCY APPROVING THE LAST & FINAL RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR FISCAL YEARS 2023-38 AND APPROVING CERTAIN RELATED ACTIVITIES". 8.d Consideration of Approval of Minutes Approved the minutes of the Regular City Council Meeting of August 23, 2022, as submitted. 8.e Consideration of Adoption of a Resolution Declaring a Continued Local Emergency Related to the Coronavirus (COVID-19) Pandemic Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING A CONTINUED LOCAL EMERGENCY RELATED TO THE CORONAVIRUS (COVID-19) PANDEMIC". 8.f Consideration of Cancellation of November 8, 2022 City Council Meeting Cancelled the regularly scheduled Council meeting of November 8, 2022. 8.g Consideration of Authorizing the City Attorney to Amend the Affordable Housing Agreement for 252 S. Courtland Street Authorized the City Attorney to amend the Agreement allowing the property owner to sell the subject property to an eligible, moderate income household. 8.h Consideration of a Resolution Approving a Grant Agreement from the Office of Traffic Safety for Traffic Records Improvement and Approval of the Purchase of the Crossroads Traffic Collision Reporting and Electronic Citation Systems 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AND AUTHORIZING THE CHIEF OF POLICE TO EXECUTE AN AGREEMENT WITH THE CALIFORNIA OFFICE OF TRAFFIC SAFETY TO ACCEPT GRANT FUNDING FOR TRAFFIC RECORDS IMPROVEMENT PROJECT AND TO APPROPRIATE THE FUNDING FOR THE PROGRAM ACTIVITIES"; 2) Approved a Budget Amendment Request for FY 2022-23 in the amount of $109,000 to account for the OTS grant revenue and the expenditures for the new reporting and citation systems, and 3) Approved the sole source purchase of the Crossroads traffic collision reporting and electronic citation software programs. 8.i Consideration of a Resolution Approving a Grant Agreement with the Office of Traffic Safety for Traffic/DUI Enforcement 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AND AUTHORIZING THE CHIEF OF POLICE TO EXECUTE AN AGREEMENT WITH THE CALIFORNIA OFFICE OF TRAFFIC SAFETY TO ACCEPT GRANT FUNDING FOR TRAFFIC SAFETY PROGRAMS AND TO APPROPRIATE Page 229 of 512 5 Item 8.e. THE FUNDING FOR THE PROGRAM ACTIVITIES"; and 2) Approved a Budget Amendment Request for FY 2022-23 in the amount of $58,000 to account for the additional revenue and expenditures related to the grant. 8.j Consider Adoption of a Resolution Pursuant to Public Contract Code (PCC) Section 20168 and Authorizing Contracting Without a Competitive Solicitation for Bids Pursuant to PCC Section 22050 for FCFA Station 1 Emergency Generator Replacement 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING AN EMERGENCY AND AUTHORIZING THE IMMEDIATE EXPENDITURE OF FUNDS TO REPLACE THE EMERGENCY GENERATOR AT THE FIVE CITIES FIRE AUTHORITY STATION 1"; and 2) Authorized the City Manager, or designee, to execute a contract with a qualified contractor for construction of the project. 8.k Consideration of Acceptance of the 2021 Street Repairs Project, PW 2021-01 1) Accepted the project improvements as constructed by Ferravanti Grading & Paving in accordance with the plans and specifications for the 2021 Street Repairs Project, PW 2021-01; 2) Directed staff to file a Notice of Completion; and 3) Authorized release of retention, thirty-five (35) days after the Notice of Completion has been recorded, if no liens have been filed. 8.l Consideration of Resolution Authorizing Refund of Planning Commission Appeal Fees to the Appellants of Vacation Rental Permits Approved for 263-D Spruce Street and 1170 Linda Drive Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AUTHORIZING THE REFUND OF APPEAL FEES FOR THE APPEALS OF THE SHORT-TERM RENTALS AT 263-D SPRUCE STREET AND 1170 LINDA DRIVE". 8.m Consideration of a Grant Agreement with Smart Share Housing Solutions for Public Outreach, Education, and Project Management to Facilitate Development of Accessory Dwelling Units in Arroyo Grande Reviewed the proposal from SSHS and authorize the City Manager to execute an Agreement between the City and SSHS for public outreach, education, and project management and demonstration to facilitate the development of ADUs in the City. 9. PUBLIC HEARINGS Mayor/Chair Ray Russom noted that due to conflicts of interest, Council previously drew straws to see who would hear each item. 9.a Discuss and Consider Introduction of Ordinance Amending Title 16 of Arroyo Grande Municipal Code Regarding Accessory Dwelling Units; Development Code Amendment 20-001 and Consideration of a Fee Waiver Program for Certain Accessory Dwelling Units Mayor Ray Russom called for a brief break at 8:54 p.m. The Council reconvened at 9:04 p.m. This item was heard after Item 9.b. Mayor Ray Russom declared a conflict of interest due to owning an ADU and left the meeting. Mayor Pro Tem George presided over the meeting. Page 230 of 512 6 Item 8.e. Planning Manager Perez presented the staff report and recommended that Council introduce the Ordinance amending the regulations for accessory dwelling units and provide feedback about the details of the proposed fee waiver program. Staff responded to questions. Mayor Pro Tem George opened the public hearing. Speaking from the public was Ben Franco. Upon hearing no further public comments, Mayor Pro Tem George closed the public hearing and directed staff to follow-up with the commenter. Moved by Mayor Pro Tem/Vice Chair George Seconded by Council/Board Member Paulding Introduce an Ordinance entitled: "AN ORDINANCE OF THE CITY COUNCIL ADOPTING AMENDMENTS TO TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE (AGMC) REGARDING ACCESSORY DWELLING UNITS; LOCATION- CITYWIDE". City Attorney Carmel read the full title of the Ordinance into the record. AYES (3): Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor/Chair Ray Russom, and Council/Board Member Barneich Passed (3 to 0) 9.b Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 This item was heard out of order. Mayor Pro Tem George declared a conflict of interest due to owning a short-term rental and left the meeting. Community Development Director Pedrotti introduced the item. Associate Planner Holub presented the item and recommended that the Council introduce an Ordinance amending Title 16 of the AGMC regarding short-term rentals and responded to questions. Mayor Ray Russom opened the public hearing. Speaking from the public were John Hagler, Sharon Valienzi, Ben Franco, Jim Guthrie, Jami Fordyce, Corina Garsa, Francine Errico, Ken Steitz. Upon hearing no further public comments, Mayor Ray Russom closed the public hearing. Mayor Ray Russom responded to questions from the public. City Attorney Carmel provided clarification regarding references to properties being "grandfathered in." Staff responded to questions from Council. Moved by Mayor/Chair Ray Russom Seconded by Council/Board Member Paulding To modify the Ordinance as follows: a cap of 90 vacation rentals with a 6-month lookback; a short-term rental buffer of 500 feet as recommended by the Planning Commission; language for revocation triggers; "unresponsive emergency contact" defined as a contact who does not respond 3 times in a 12-month rolling period and would initiate a revocation hearing; language that 2 citations or arrests in a 12-month rolling period would initiate a revocation hearing; Page 231 of 512 7 Item 8.e. language in outreach letters regarding voluntary relinquishment of permits for existing permit holders; language that TOT must be paid every 6 months; modify language that states the 2- space parking requirement only applies to vacation rentals; the wording "revocation proceeding" be changed to "revocation hearing;" definitions are approved as presented by staff; and to continue the introduction of an Ordinance amending Title 16 of the AGMC regarding short term rentals to a date certain of September 27, 2022. AYES (3): Mayor/Chair Ray Russom, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor Pro Tem/Vice Chair George, and Council/Board Member Barneich Passed (3 to 0) 10. OLD BUSINESS None. 11. NEW BUSINESS 11.a Discussion of Draft Ordinance Addressing Tiny Homes on Wheels This item was heard after item 9.a. Mayor Ray Russom previously declared a conflict of interest due to owning an ADU and left the meeting. Planning Manager Perez presented the report and staff responded to questions from Council. Mayor Pro Tem George invited public comment. Speaking from the public was Joe Pollon. No further public comments were received. Building Official Meyers provided more information regarding tiny home accreditation organizations permitted. Mayor Pro Tem George directed staff to research accreditation options. Moved by Council/Board Member Paulding Seconded by Council/Board Member Storton Approve staff's recommendation with the modification to add language to paragraph B3 to state "in addition to the RVIA any other HCD approved association", and to ban roof top decks. AYES (3): Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor/Chair Ray Russom, and Council/Board Member Barneich Passed (3 to 0) 12. COUNCIL COMMUNICATIONS This item was heard out of order. Mayor/Chair Ray Russom stated that she will be unable to attend the Mayor's meeting and asked if any other Council Member would be available to attend. Council members Storton, Paulding and George stated they would not be able to attend. Page 232 of 512 8 Item 8.e. 13. CLOSED SESSION None. 14. ADJOURNMENT There being no further business to come before the City Council/Board of Directors, Mayor Pro Tem George adjourned the meeting at 9:47 p.m. _________________________ Caren Ray Russom, Mayor/Chair ATTEST: _________________________ Jessica Matson, City Clerk/Secretary Page 233 of 512 Item 8.f. MEMORANDUM TO: City Council FROM: Jessica Matson, Legislative & Information Services Director/City Clerk SUBJECT: Consideration of Conflict of Interest Code Biennial Review and Resolution Amending the City of Arroyo Grande Conflict of Interest Code DATE: September 27, 2022 SUMMARY OF ACTION: Biennial review of the City’s Conflict of Interest Code and amendment to the list of designated positions. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: There are no fiscal or personnel impacts as a result of the proposed action. RECOMMENDATION: Adopt a Resolution approving an amended Conflict of Interest Code for designated positions. BACKGROUND: The California Political Reform Act requires every local government agency to adopt a Conflict of Interest Code (“COI Code”). The COI Code designates positions within the City required to file Statements of Economic Interests and assigns disclosure categor ies specifying the types of financial interests to be reported. Further, the Political Reform Act contains specific provisions setting forth any circumstances under which designated positions or categories of designated positions must disqualify themselves from making, participating in the making, or using their official position to influence the making of any decision. Certain officials, including the Mayor, members of the City Council, candidates for City offices, members of the Planning Commission, City Manager, City Attorney, and City Treasurer are exempt from the City’s Conflict of Interest Code as they are all otherwise statutorily required to file disclosure statements pursuant to Government Code Section 87200 (commonly known as “87200 filers”). The City’s COI Code and list of designated positions supplements those statutory requirements by including employees, consultants, and members of City advisory bodies who are not 87200 filers. It is important to note that Page 234 of 512 Item 8.f. City Council Consideration of Conflict of Interest Code Biennial Review and Resolution Amending the City of Arroyo Grande Conflict of Interest Code September 27, 2022 Page 2 the list of designated positions includes members of the Successor Agency of the Dissolved Arroyo Grande Redevelopment Agency. Because the City Council also serves as board members of this authority, members of the Council are required to include this position on their Statements of Economic Interest Form 700 when filing their disclosure statements. ANALYSIS OF ISSUES: In 1987, the City adopted the State’s standard Conflict of Interest Code by reference which, along with the Appendix of Designated Positions and the Appendix of Disclosure Categories, constitutes the City of Arroyo Grande COI Code. Under the Political Reform Act, local agencies are required to review its COI Code biennially to determine whether the COI Code is accurate, or if revisions are needed due to organizational changes, including the creation of new positions, elimination of positions, position title changes, and/or relevant changes in the duties assigned to existing positions. The City’s COI Code was last updated in September 2020. A review of the designated positions has been completed and it has been determined that a revision to the City’s Conflict of Interest Appendix of Designated Positions is required at this time. In June 2021, the City Council adopted Resolution 5091 (Attachment 2) approving the following changes to position titles as part of the FY 2021-23 Biennial Budget: 1. Upgrading the Executive Assistant/Deputy City Clerk position to Deputy City Clerk/Communications Coordinator; 2. Changing the Human Resources Manager title to Human Resources Officer. In addition, in June 2022, the City Council adopted Resolution 5206 (Attachment 3) approving a salary classification for a Management Analyst position in the City Manager’s Office. It is recommended that all of these changes be reflected in the City’s COI Code to ensure that it is current and accurate, including the addition of the Management Analyst position to the list of designated filers. Staff has completed the biennial review of the current COI Code and has determined that no other amendments are necessary at this time. The City's COI Code accurately designates all positions that make or participate in the making of governmental decisions; the disclosure categories assigned to those positions accurately require the disclosure of all investments, business positions, interests in real property and sources of income which may foreseeably be affected materially by the decisions made by those designated Page 235 of 512 Item 8.f. City Council Consideration of Conflict of Interest Code Biennial Review and Resolution Amending the City of Arroyo Grande Conflict of Interest Code September 27, 2022 Page 3 positions; and the COI Code includes all other provisions required by Government Code Section 87302. ALTERNATIVES: The following alternatives are provided for the City Council’s consideration: 1. Adopt the Resolution approving an amended Code for designated positions 2. Modify and adopt the Resolution; or 3. Provide other direction to staff. ADVANTAGES: Adoption of the proposed Resolution will meet the requirements of the Political Reform Act concerning biennial review of the City’s COI Code. DISADVANTAGES: There are no identified disadvantages related to adoption of the proposed Resolution. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed Resolution (with Redline) 2. Resolution 5091 3. Resolution 5206 Page 236 of 512 ATTACHMENT 1 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AN AMENDED CONFLICT OF INTEREST CODE FOR DESIGNATED POSITIONS WHEREAS, the Political Reform Act of 1974 (California Government Code Sections 81000 et seq.,) requires that governmental entities in the State of California adopt and promulgate a Conflict of Interest Code; and WHEREAS, in 1987 the City of Arroyo Grande adopted a standardized Conflict of Interest Code, incorporating by reference the terms of Title 2 of the California Code of Regulations, Sections 18730 et seq., which contain the terms of a Standard Conflict of Interest Code; an Appendix of Designated Positions listing employees, officials, and consultants who make or participate in the making of decisions that may foreseeably have a material effect on their economic interests, and an Appendix of Disclosure Categories assigned to the Designated Positions; and WHEREAS, the Political Reform Act requires every local agency to review its Conflict of Interest Code biennially to determine if it is accurate and up-to-date or, to make amendments to the Code when necessitated by changed circumstances; and WHEREAS, certain positions within the City of Arroyo Grande have been upgraded, added, reclassified, or removed which requires the Conflict of Interest Code to be amended; and WHEREAS, the City Council has determined that the attached Appendices, marked Exhibit “A” and Exhibit “B”, respectively, both of which are incorporated herein by this reference, accurately set forth those positions which should be designated and categories of economic interests which should be disclosed. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Arroyo Grande as follows: 1. The above recitals are true, correct, and are incorporated herein by reference. 2. The City’s “Appendix of Designated Positions” is hereby amended and replaced in its entirety with Exhibit “A”, attached hereto and incorporated herein by this reference. 3. The City’s “Appendix of Disclosure Categories,” attached hereto as Exhibit “B” and incorporated herein by this reference, is hereby approved. BE IT FURTHER RESOLVED that the terms of 2 California Code of Regulations Sections 18730 et seq., duly adopted by the Fair Political Practices Commission, are hereby incorporated by reference and with the attached Exhibits “A” & “B” shall constitute the Conflict of Interest Code of the City of Arroyo Grande. Page 237 of 512 RESOLUTION NO. PAGE 2 BE IT FURTHER RESOLVED that this Resolution supersedes Resolution No. 5033 adopted September 22, 2020. On motion of Council Member __________, seconded by Council Member _________________, and on the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was passed and adopted this 27th day of September, 2022. Page 238 of 512 RESOLUTION NO. PAGE 3 _______________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: ________________________________________ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: _______________________________________ WHITNEY McDONALD, CITY MANAGER APPROVED AS TO FORM: _______________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 239 of 512 RESOLUTION NO. PAGE 4 CONFLICT OF INTEREST CODE FOR THE CITY OF ARROYO GRANDE The Political Reform Act, Government Code Section 81000, et seq., requires state and local government agencies to adopt and promulgate conflict of interest codes. The Fair Political Practices Commission has adopted a regulation, 2 California Code of Regulations Section 18730, which contains the terms of a standard conflict of interest code, which can be incorporated by reference in an agency's code. After public notice and hearing, it may be amended by the Fair Political Practices Commission to conform to amendments in the Political Reform Act. Therefore, the terms of Title 2 of the California Code of Regulations Section 18730 and any amendments to it duly adopted by the Fair Political Practices Commission are hereby incorporated by reference, and along with the attached appendices, Exhibit “A” and Exhibit “B”, in which positions are designated and disclosure categories are set forth, constitute the conflict of interest code of the City of Arroyo Grande, which is considered the "agency" within the purview of this code. Designated employees, committees, commissions, boards, and consultants shall file statements of economic interests with the City Clerk of the City of Arroyo Grande, who shall be and will perform the duties of filing officer for the City of Arroyo Grande and who will make the statements available for public inspection and reproduction (Gov. Code Section 81008). Upon receipt of the statements of those positions designated in Government Code Section 87200 (members of the City Council and Planning Commission, City Manager, City Attorney, and City Treasurer), the City Clerk shall make and retain a copy and forward the original of these statements to the Fair Political Practices Commission. Statements of all other designated positions will be retained by the City Clerk in accordance with State law. Page 240 of 512 RESOLUTION NO. PAGE 5 EXHIBIT "A" APPENDIX OF DESIGNATED POSITIONS The following positions entail the making or participation in the making of decisions which may foreseeably have a material effect on financial interests: Designated Position:2 Disclosure Category: Management Analyst 1, 3 Assistant City Manager/Public Works Director 1, 2, 3 Capital Improvement Project Manager 1, 2, 3 Utilities Manager 1, 3 Public Works Manager 1, 3 Public Works Supervisor 1, 3 Director of Community Development 1, 2, 3 Planning Manager 1, 2, 3 Associate Planner 1, 2, 3 Assistant Planner 1, 2, 3 City Engineer 1, 2, 3 Senior Engineer 1, 2, 3 Associate Engineer 1, 2, 3 Assistant Engineer 1, 2, 3 Engineering Inspector 1, 2, 3 Building Official 1, 2, 3 Building and Fire Safety Inspector 1, 2, 3 Director of Legislative and Information Services/City Clerk 1, 3 Information Technology Manager 1, 3 Executive Assistant/Deputy City Clerk/Communications Coordinator 1, 3 Police Chief 1, 2, 3 Police Commander 1, 2, 3 Director of Administrative Services 1, 2, 3 Accounting Manager 1, 3 Human Resources ManagerOfficer 1, 3 Director of Recreation Services 1, 2, 3 Assistant City Attorney 1, 2, 3 Deputy City Attorney 1, 2, 3 Architectural Review Committee Member 1, 2, 3 Downtown Parking Advisory Board Member 1, 2, 3 Tourism Business Improvement District Board Member 1, 2, 3 Successor Agency Board Member 1, 2, 3 Consultants3 Determined on case by case basis Exempt Officials4 1, 2, 3 2 In the event that State law or regulations regarding the filing of Conflict of Interest Statements should be amended, this Exhibit shall be changed to include the designated position and category of each official as required by said amendment. 3 Consultants: An individual is a consultant if the person serves in a staff capacity with the agency and in that capacity performs the same or substantially all the same duties for the agency that would otherwise be performed by a person holding a position specified or that should be specified in the City’s Conflict of Interest Code. The City Manager and/or the City Attorney may determine in writing that a particular consultant, although a “designated position”, is hired to perform a range of duties that are limited in scope and thus is not required to fully comply with the disclosure requirements described herein. Such written determination shall include a description of the consultant’s duties and, based upon that description, a statement of the extent of disclosure requirements. The City Manager’s and/or the City Attorney’s determination is a public record and shall be retained for public inspection in the same manner and location as this Conflict of Interest Code. 4 Exempt Officials include the Mayor, Members of the City Council, candidates for City offices, Members of the Planning Commission, City Manager, City Attorney, and City Treasurer who are all otherwise required to file disclosure statements pursuant to State Law. Page 241 of 512 RESOLUTION NO. PAGE 6 EXHIBIT “B” APPENDIX OF DISCLOSURE CATEGORIES CATEGORIES OF DISCLOSURE FOR DESIGNATED POSITIONS The following shall be the categories of disclosure covered by this Policy: 1. Investments California Fair Political Practices Committee (“FPPC”) Form 700, Schedules A-1 and A-2 2. Interests in Real Property FPPC Form 700, Schedule B 3. Income & Business Positions FPPC Form 700, Schedule C, D, and E The officials and employees covered by this policy shall each disclose the categories 1, 2, and 3 as designated herein above set forth. Page 242 of 512 ATTACHMENT 2 Page 243 of 512 Page 244 of 512 Page 245 of 512 Page 246 of 512 Page 247 of 512 Page 248 of 512 Page 249 of 512 Page 250 of 512 Page 251 of 512 Page 252 of 512 Page 253 of 512 ATTACHMENT 3 Page 254 of 512 Page 255 of 512 Page 256 of 512 Page 257 of 512 Page 258 of 512 Page 259 of 512 Page 260 of 512 Page 261 of 512 Page 262 of 512 Page 263 of 512 Item 8.g. MEMORANDUM TO: City Council FROM: Michael T. Martinez, Chief of Police BY: Zak Ayala, Commander SUBJECT: Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus DATE: September 27, 2022 SUMMARY OF ACTION: Approval of the recommended action will result in the purchase of nine (9) marked 2023 Ford Explorer vehicles for use by the Police Department’s Patrol Services; the purchase of one (1) 2023 Ford F-250 Truck for use by the Police Department’s Patrol Services; the purchase of two (2) marked 2023 Ford Rangers for use by the Police Department’s Support Services; and the purchase of one (1) 2023 Ford Transit Van for use by the Police Department’s Support Services. The action will also authorize the purchase of equipment for upfitting the vehicles and declaring 14 vehicles as surplus. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The FY 2022-23 Budget allocates $178,000 to Lease Purchase Payments and $247,300 to Vehicle purchases for Police Department vehicles, totaling $425,300. Ford Explorer Lease Purchase Payments financing agreement for nine (9) Patrol vehicles and upfitting for a total not to exceed the amount of $74 9,103, through a 4-year municipal lease from Holman Capital Corporation at an APR of 4.57%, will include 4 annual payments of approximately $201,583; the first payment will be completed in FY 2022-23. The Ford F- 250 Truck, Ford Rangers, and Ford Transit Van expenditures will cost approximately $204,395 to be completed in FY 2022-23 as a cash purchase. The total to lease and purchase the proposed 13 vehicles will cost $405,978 in FY 2022-23. The vehicles will be on a full warranty during the terms of the lease. The City anticipates receiving $305,000 in revenue from the sale of the existing surplus vehicles that will offset this cost, reducing the net impact to $100,978. RECOMMENDATION: 1) Authorize the purchase of (a) thirteen (13) vehicles from Mullahey Ford, (b) vehicle fleet upfitting from Dana Safety Supply, (c) MDC Computers from Code3 Technologies, and (d) dash cameras from Safe Fleet; 2) Authorize a financing agreement for nine (9) Page 264 of 512 Item 8.g. City Council Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus September 27, 2022 Page 2 Patrol vehicles and upfitting for a total not to exceed the amount of $74 9,103, through a 4-year municipal lease from Holman Capital Corporation at an APR of 4.57% (4 annual payments of approximately $201,583); 3) Authorize the cash purchase of four (4) vehicles and upfitting not to exceed the amount of $20 4,395; 4) Adopt a Resolution declaring existing Police vehicles as surplus and authorizing their sale; and 5) Authorize the City Manager to execute all necessary documents. BACKGROUND: The Arroyo Grande Police Department (Police Department) introduced the fleet leasing program in 2008, and it has proven to be a cost-effective alternative to traditional purchasing. Municipal leasing has become a viable alternative for municipalities that operate small to medium sized fleets. The programs are competitive, cost -effective, and many times reduce the total average operating costs of operating the fleet. Vehicles purchased through the fleet leasing program are covered by a manufacturer’s extended service contract during the entire term of the lease, which has proven valuable in reducing the annual cost of fleet maintenance. The $1.00 end of lease purchase option allows the vehicles to be declared as surplus and sold to cover equipment up-fitting costs each time a new lease program is approved. The program rotates the fleet every four years and the residual value of the fleet at the end of the lease term helps maintain the ongoing program. The current Police Department patrol fleet lease concluded in FY 2020- 21, at which time the vehicles were slated for replacement. Replacement of the patrol fleet was deferred for one year for financial savings to the City during the COVID-19 pandemic. The patrol fleet is over 5 years old and has seen significa nt increases in maintenance costs to the Department due to vehicles no longer being under manufacturer warranties. Vehicles from the Department’s support fleet, which include a 2015 Dodge Ram 1500, a 2001 Ford F550, a 2015 Dodge Ram 3500 and a 2005 Chevrolet Impala, are also over 5 years old and have also seen significant increases in maintenance costs due to being out of warranty. The City’s Administrative Policy and Procedure C-006 states that replacement of equipment should consider the following criteria: 1. Condition of the equipment 2. Age of equipment (for autos – 5 years and/or 80,000 miles) 3. Maintenance history of the equipment On June 14, 2022, the City Council approved the FY 2022 -23 Mid-Cycle Budget Update that included the following Proposed Vehicle Replacement Requests table: Page 265 of 512 Item 8.g. City Council Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus September 27, 2022 Page 3 The table reflects the total cost of vehicles that will be leased over a four -year term. The FY 2022-23 budget includes principal and interest payments for the first year’s payments, and the remaining amounts will be included in future budgets. The 4 propo sed Police vehicles for purchase included in the proposed vehicle replacement request total $247,300 and the estimated lease payment for the 9 leased vehicles is estimated to be $178,000 per year for the four-year lease period, totaling $425,300 in FY 2022-23. ANALYSIS OF ISSUES: Police Fleet Lease and Purchase A Vehicle Selection Committee was formed within the Police Department and evaluated a number of police-rated vehicles. In 2017, the Committee recommended switching to the Ford Explorer for the entire fleet. The Department was on schedule to transition the Patrol Ford Explorers at the end of the four-year rotation during FY 2021-22 but delayed the transition due to anticipated budgetary impacts of the COVID-19 pandemic. Due to supply chain issues with vehicle and equipment manufacturers, the Department was unable to obtain accurate price quotes from vendors until late August 2022. A Vehicle Selection Committee convened in early 2022 and again selected the Ford Explorer for meeting the fleet needs of Patrol Services. The Committee further selected Ford trucks and a van for meeting the needs of Support Services (SWAT, DUI/Traffic, Cadet and Volunteers). The selection of the Ford vehicles for the patrol fleet will provide purchasing and support from a local dealer while continuing to provide consistency in vehicles and the opportunity to retain an inventory of regular maintenance related parts and equipment. The selection committee had initially recommended two (2) Ford Expeditions for Patrol supervisors, due to their increased cargo capacity, but this recommendation was changed back to Ford Explorers in order to save significant costs and maintain fleet consistency. This does not change the total amount of Patrol vehicles. The Police Department Patrol fleet operates nine (9) marked (black and white) police vehicles. The current proposal calls for replacing and maintaining the same number of marked police vehicles under a municipal lease agreement. Page 266 of 512 Item 8.g. City Council Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus September 27, 2022 Page 4 The following marked Patrol vehicles are in need of replacement:  Unit 4601: 2017 Ford Explorer  Unit 4602: 2017 Ford Explorer  Unit 4603: 2017 Ford Explorer  Unit 4604: 2017 Ford Explorer  Unit 4605: 2017 Ford Explorer  Unit 4606: 2017 Ford Explorer  Unit 4607: 2017 Ford Explorer  Unit 4608: 2017 Ford Explorer  Unit 4609: 2017 Ford Explorer The Police Department fleet operates four (4) marked vehicles used by Support Services. The current proposal calls for replacing and maintaining the same number of marked Support vehicles. These vehicles would not be on the Patrol 4-year lease rotation, rather would be purchased, and remain in service for no less than 5 years due to their expected mileage and wear and tear, in relation to the Patrol vehicles. The following marked Support vehicles are in need of replacement:  Unit 4613: 2015 Dodge Ram 1500 Assigned to Cadet program  Unit 4623: 2001 Ford F550 Assigned to SWAT  Unit 4622: 2015 Dodge Ram 3500 Assigned to Traffic Safety/ DUI  Unit 4627: 2005 Chevrolet Impala Assigned to Volunteers/ pool vehicle The Ford F-250 would replace Unit 4622, a 2015 Dodge Ram 3500. It addresses the specific needs of the Traffic Officers. The vehicle will be used to stage and transport their specialized equipment, such as traffic cones, lighting, measuring devices for major collisions and investigations, as well as the ability to safely pull the Traffic Safety/DUI trailer due to its specific weight capacity. The two (2) Ford Rangers would replace Unit 4613, a 2015 Dodge Ram 1500, and Unit 4627, a 2005 Chevrolet Impala. The Ford Rangers address the needs of the Cadet and Volunteers, due to their passenger carrying capability, utility cargo beds, fuel economy, and small footprint compared to full size vehicles. The Ford Transit Van would replace Unit 4623, a Ford-550 truck. It addresses the needs of SWAT officers, due to its passenger carrying capability, while also providing a means to safely store and secure their associated weapons and equipment. Page 267 of 512 Item 8.g. City Council Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus September 27, 2022 Page 5 Upfitting of the vehicles to make them service ready will include all electronics and equipment upgrades, including graphics, emergency lighting, siren, consoles, computers, audio-video recorders, transport compartments, radios and other related safety equipment. Ford Explorer vehicles Lease Purchase Payments will cost approximately $201,583 a year for four (4) years, as shown in Table 1 below: Table 1 Ford Explorers Lease Purchase Payments The Ford F-250 Truck, Ford Rangers, and Ford Transit Van expenditures will cost a total one-time payment of approximately $204,395, as shown in Table 2 below: Table 2 Support Vehicles Holman Capital Corporation has proposed a competitive lease finance agreement for nine (9) 2023 Ford Explorers; as well as up-fitting costs for the Patrol vehicles. It is recommended that the City enter into a municipal lease purchase agreement with Holman Capital Corporation, with a lease-financing rate of 4.57%, which results in four (4) annual payments of approximately $201,583. Holman Capital Corporation is headquartered in Laguna Hills, CA. Other bids for financing were Sparta Commercial Services at 5.06% and California First Leasing at 5.54%. Holman Capital Corporation has agreed to the purchase option of $1.00 at the end of the 4 -year Term provided no event of default has occurred and is continuing at the end of the Term. It is recommended that the City Council approve the lease agreement with Holman Capital Corporation Services for nine (9) patrol vehicles, and the purchase of four (4) support vehicles from Mullahey Ford, not to exceed the combined amount of $692,074. This is the purchase of nine (9) Ford Explorers totaling $504,300, as shown in Table 1 Type # of units Lease /Buy Mullahey Ford Dana Safety Code3 Tech Safe Fleet Financing Fee Total Purchase Ford Explorers 9 Lease 504,300 149,358 32,089 60,355 3,000 749,103 Interest & Fees 57,231 Total Financing 806,334 Annual payment 201,583 Type # of units Lease /Buy Mullahey Ford Dana Safety Total Purchase Ford Ranger Crew Cab 2 Buy 76,510 5,084 81,594 Ford F250 1 Buy 60,343 8,167 68,510 Ford Transit Van 1 Buy 50,921 3,370 54,291 187,774 16,621 204,395 Page 268 of 512 Item 8.g. City Council Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus September 27, 2022 Page 6 column titled Mullahey Ford, plus the four (4) Support Vehicles totaling $187,774, as shown in Table 2 column titled Mullahey Ford. This quote is less than the State of California contract used by larger jurisdictions. Additional benefits include purchasing from a local Arroyo Grande vendor, local tax revenue from the sale, and having the continued convenience of warranty coverage and local service on the vehicl e fleet. It is further recommended that the City Council authorize the purchase of the following Support vehicles: one (1) 2023 Ford F-250; two (2) 2023 Ford Rangers; and one (1) 2023 Ford Transit Van, including necessary upfitting, purchased with cash for $204,395 in order to reduce financing costs. It is recommended that the City Council approve the upfitting agreement with Dana Safety Supply for thirteen (13) vehicles, not to exceed the amount of $165,979. This is the purchase of upfitting the nine (9) Ford Explorers totaling $149,358, as shown in Table 1 column titled Dana Safety, plus upfitting the four (4) Support Vehicles totaling $16,621, as shown in Table 2 column titled Dana Safety. This quote was selected due to significant cost savings from other businesses, quality of work, projected turn-around time, past City projects, and availability of components. Dana Safety Supply met the Department’s needs in performing installations and upgrades for the Department’s Administration fleet replacements in 2021. It is recommended that the City Council authorize the purchase of MDC Computers from Code3 Technologies totaling $32,089. The current computers in the Patrol fleet are over 5 years old and were recommended for replacement by the former City Inform ation Technology Manager due to their age, capabilities, and evolving technology requirements. Replacement of the computers would be from the same vendor, Code3 Technologies - Gettac, as the existing systems and would be covered by a manufacturer’s warranty for 4 years. It is recommended that the City Council authorize the purchase of dash cameras from Safe Fleet totaling $60,355. The current audio-visual recorders in the Patrol fleet are over 5 years old and no longer under warranty. They are recommended for replacement due to service issues related to aging technology and expected repairs to motherboards. Replacement of the audio-visual recorders would be from the same vendor, SafeFleet - COBAN, as existing systems, and would continue to work in conjunct ion with the Department’s body worn camera system and software. These recording systems would be covered by a manufacturer’s warranty for 4 years. Page 269 of 512 Item 8.g. City Council Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus September 27, 2022 Page 7 Declaration of Vehicles as Surplus In anticipation of this proposed fleet replacement, and to begin to realize revenues to apply towards this proposal, the Department surplused the following by Council Resolution on April 12, 2022:  Unit 4601: 2017 Ford Explorer K9 SUV  Unit 4627: 2005 Chevrolet Impala  Unit 4622: 2015 Dodge Ram 3500 It is recommended that the City Council declare as surplus the following vehicles:  Unit 4602: 2017 Ford Explorer  Unit 4603: 2017 Ford Explorer  Unit 4604: 2017 Ford Explorer  Unit 4605: 2017 Ford Explorer  Unit 4606: 2017 Ford Explorer  Unit 4607: 2017 Ford Explorer  Unit 4608: 2017 Ford Explorer  Unit 4609: 2017 Ford Explorer  Unit 4613: 2015 Dodge Ram 1500  Unit 4623: 2001 Ford F550 The City anticipates receiving $280,000 in surplus revenue from the sale of the existing vehicles ($30,000 per Ford Explorer x 8, totaling $240,000, plus $20,000 for the Dodge Ram 1500, plus $20,000 for the Ford F550). It is further recommended that the following vehicles be declared as surplus, as they were replaced following authorization by the City Council on July 27, 2021:  Unit 4612: 2016 Dodge Charger  Unit 4611: 2016 Dodge Charger  Unit 4620: 2005 Honda Motorcycle  Unit 4621: 2005 Honda Motorcycle The City anticipates receiving $25,000 in surplus revenue from the sale of the existing vehicles that will offset this cost ($12,000 per Dodge Charger x 2, totaling $24,000, plus $500 per Honda Motorcycle totaling $1,000). Based on the condition of the aforementioned Police Department fleet vehicles , a residual surplus value is estimated to be approximately $305,000. This surplus revenue from the sale of the existing vehicles will offset the cost of this project in FY 2022-23. Page 270 of 512 Item 8.g. City Council Consideration of an Agreement for Police Fleet Lease and Purchase and Resolution Declaring Vehicles as Surplus September 27, 2022 Page 8 ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. 1) Authorize the purchase of (a) thirteen (13) vehicles from Mullahey Ford, (b) vehicle fleet upfitting from Dana Safety Supply, (c) MDC Computers from Code3 Technologies, and (d) dash cameras from Safe Fleet; 2) Authorize a financing agreement for nine (9) Patrol vehicles and upfitting for a total not to exceed the amount of $749,103, through a 4-year municipal lease from Holman Capital Corporation at an APR of 4.57% (4 annual payments of approximately $201,583); 3) Authorize the cash purchase of four (4) vehicles and upfitting not to exceed the amount of $204,395; 4) Adopt a Resolution declaring existing Police vehicles as surplus and authorizing their sale; and 5) Authorize the City Manager to execute all necessary documents; 2. Do not authorize the purchase of some or all of the proposed vehicles , and/or do not approve the municipal lease, and/or do not adopt the proposed resolution to surplus certain vehicles, and direct staff to seek new proposals; or 3. Provide other direction to staff. ADVANTAGES: The proposed plan will continue to provide for the police fleet leasing program, update the police vehicle fleet, maintain standardized equipment, reduce maintenance costs, and maintain residual values on the existing fleet for surplus sale. DISADVANTAGES: No disadvantages are identified at this time. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Lease Purchase Financing Approval – Holman Capital Corporation 2. Proposed Resolution – Declaring Surplus Vehicles Page 271 of 512 City of Arroyo Grande/ Holman Capital Corporation Master Equipment Lease-Purchase Agreement 9/27/2022 INDEX TO LEGAL DOCUMENTS BANK-QUALIFIED, APPROPRIATION-BASED, ESCROW FUNDED TAX-EXEMPT MASTER EQUIPMENT LEASE-PURCHASE AGREEMENT DATED SEPTEMBER 30, 2022 BY AND BETWEEN HOLMAN CAPITAL CORPORATION And CITY OF ARROYO GRANDE Lease Documents: Tab 1: Master Equipment Lease-Purchase Agreement; Tab 2: Exhibit A – Payment Schedule; Tab 3: Exhibit A-1 – Notice and Acknowledgment of Assignment; Tab 4: Exhibit B-1 – Insurance Coverage Request; Tab 5: Exhibit B-2 – Self-Insurance Rider (if applicable); Tab 6: Exhibit C – Essential Use Certificate; Tab 7: Exhibit D – Incumbency Certificate; Tab 8: Exhibit E – Opinion of Lessee’s Counsel; Tab 9: Exhibit F – Bank Qualified Certificate (omit if NBQ); Tab 10: Exhibit G – Post Issuance Tax Compliance Procedures; Tab 11: Exhibit H – Escrow Agreement; Tab 12: Exhibit I - Resolution of Lessee; Tab 13: Exhibit J - UCC-1 Financing Statement with attached Schedule A (to be filed by the Investor); Tab 14: Exhibit K - Form 8038-G; Tab 15: Exhibit L - Closing Memorandum/Payment Proceeds Direction; and Assignment Documents (Lessor and Investor Only): Tab 16: Assignment Agreement with Schedule A thereto. HOLMAN CAPITAL CORPORATION ATTACHMENT 1 Page 272 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 1 Master Equipment Lease-Purchase Agreement 9/27/2022 MASTER EQUIPMENT LEASE-PURCHASE AGREEMENT 1. Agreement. Subject to the terms and conditions contained in this Master Equipment Lease-Purchase Agreement dated September 30, 2022 (this “Master Lease Agreement”), HOLMAN CAPITAL CORPORATION, as lessor (“Lessor”), whose mailing address is 25231 Paseo de Alicia, Suite 105, Laguna Hills, CA 92653, hereby purchases from and agrees to sell, transfer and lease back to the CITY OF ARROYO GRANDE as lessee (“Lessee”), whose mailing address is 300 E Branch Street , Arroyo Grande, CA 93420, and Lessee hereby sells to and agrees to acquire, purchase and lease back from Lessor, the items of personal property (together with any replacement parts, additions, substitutions, repairs or accessories now or hereafter incorporated in or affixed to it, hereinafter referred to collectively as the “Equipment”) described, particularly, in each Payment Schedule to be issued under this Master Lease Agreement in the form attached hereto as Exhibit A (the “Payment Schedule”). The Master Lease Agreement and each Payment Schedule issued hereunder shall constitute a separate “Lease.” 2. Term. The term of each Lease under a Payment Schedule issued under this Master Lease Agreement (the “Lease Term”) begins as of the Commencement Date stated in the applicable Payment Schedule and shall continue so long as any amounts remain unpaid under that Payment Schedule. Each Lease Term will terminate upon the first to occur of: (a) the exercise by Lessee of the option to purchase the Equipment pursuant to Paragraph 11 and the applicable Payment Schedule, (b) Lessor’s election to terminate this Lease Agreement pursuant to Paragraph 17, (c) Lessee’s option to terminate this Lease Agreement pursuant to Paragraph 4, and (d) the payment by Lessee of all sums required to be paid by Lessee under the applicable Payment Schedule. 3. Escrow Agreements. On the Commencement Date for an applicable Payment Schedule, Lessor and Lessee shall enter into an escrow agreement (an “Escrow Agreement”) dated the respective Commencement Date, between Lessor, Lessee, and the escrow agent specified in the particular Escrow Agreement, relating to the escrow fund (an “Escrow Fund”) created thereunder. On each Commencement Date, Lessor shall deposit the amount specified in the applicable Escrow Agreement into the Escrow Fund to be held in escrow and applied upon the express terms and conditions of the Escrow Agreement for the acquisition of the equipment which shall be disbursed as provided for in the Closing Memorandum and/or Escrow Agreement applicable to the particular Payment Schedule. 4. Rental Payments. Lessee agrees to pay the rental payments specified in the applicable Payment Schedule for the specified Lease Term in the amounts and on the dates identified in the Payment Schedule. Payment of all rental payments and other amounts payable shall be made to Lessor at its above- stated address or as it shall otherwise designate in writing. As set forth in the applicable Payment Schedule, a portion of each rental payment is paid as, and represents payment of, interest (as calculated based on a 360-day year consisting of 12 months of 30 days), and the balance of each rental payment is paid as, and represents payment of, principal. Notwithstanding any provision to the contrary in this Master Lease Agreement, Lessee may terminate this Lease, or any individual Payment Schedule, at the end of any fiscal year of Lessee (a “Fiscal Year”) if sufficient funds are not appropriated by Lessee’s governing body to pay rental payments and other amounts due under the Lease or any individual Payment Schedule during the next succeeding Fiscal Year (an “Event of Nonappropriation”). Lessee hereby agrees to notify Lessor at least 30 days prior to the last day of its then current Fiscal Year of the occurrence of an Event of Nonappropriation or, if nonappropriation has not occurred by that date, promptly upon the occurrence of an Event of Nonappropriation. Lessee covenants, represents and warrants that: (a) if a Payment Schedule is issued concurrently with this Master Lease Agreement, it has made sufficient appropriations or has other legally available funds to pay all rental payments due during the first Fiscal Year under that Payment Schedule; (b) the officer of Lessee responsible for budget preparation will do all things lawfully within his/her power to obtain appropriated funds for the payment of rental payments and other amounts required to be paid under any Page 273 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 2 9/27/2022 Master Equipment Lease-Purchase Agreement Payment Schedule in the first Fiscal Year under that particular Payment Schedule and in each next succeeding Fiscal Year for the Lease Term; and (c) Lessee acknowledges that Lessor has relied upon these representations as an inducement to enter into this Master Lease Agreement. If an Event of Nonappropriation shall occur, Lessee agrees, at Lessee’s sole cost and expense, peaceably to deliver the corresponding Equipment under any Payment Schedule to Lessor at such location in the continental United States as is specified by Lessor, in the condition required by Paragraph 8 of this Lease Agreement, on or before the effective date of termination. Lessee’s obligation to pay rental payments and any additional amounts payable under any Payment Schedule constitutes a current obligation payable exclusively from legally available funds and shall not be construed to be an indebtedness within the meaning of any applicable constitutional or statutory limitation or requirement. 5. Essentiality. Subject to Paragraph 4 of this Lease Agreement, Lessee’s present intention is to make rental payments for any Lease Term as long as it has sufficient appropriations or other legally available funds. Lessee represents that, with respect hereto, (a) the use and operation of any Equipment to be leased under a Payment Schedule shall be essential to its proper, efficient, and economic governmental operation and (b) the functions performed by such Equipment could not be transferred to other equipment available for its use. Lessee does not intend to sell or otherwise dispose of the Equipment or any interest therein prior to the last rental payment scheduled to be paid under any Payment Schedule. On each Commencement Date, Lessee shall complete and provide Lessor a certificate in the form of Exhibit C. 6. Disclaimer of Warranties. LESSEE REPRESENTS AND AGREES THAT IT HAS SELECTED, OR WILL SELECT, THE EQUIPMENT PRIOR TO HAVING REQUESTED LESS OR TO FINANCE THE SAME. LESSEE AGREES THAT LESSOR HAS NOT MADE ANY, AND MAKES NO, REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE, DIRECTLY OR INDIRECTLY, EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING (WITHOUT LIMITATION) THE SUITABILITY OF THE EQUIPMENT, ITS DURABILITY, ITS FITNESS FOR ANY PARTICULAR PURPOSE, ITS MERCHANTABILITY, ITS CONDITION, ITS CAPACITY, ITS OPERATION, ITS PERFORMANCE, ITS DESIGN, ITS MATERIALS, ITS WORKMANSHIP AND/OR ITS QUALITY. AS BETWEEN LESSEE AND LESSOR, LESSEE LEASES, PURCHASES AND ACQUIRES THE EQUIPMENT “AS IS” “WHERE IS” AND “WITH ALL FAULTS.” Lessor hereby assigns to Lessee, to the extent that it may lawfully do so, so long as no Event of Default and no Event of Nonappropriation shall have occurred and be continuing under any Payment Schedule, all rights and benefits that Lessor may have under any warranty, guaranty or the like that may be made with respect to any designated Equipment by the manufacturer, seller and/or supplier (collectively, the “Vendor”) thereof. Lessor shall not be liable to Lessee or any third party for any loss, damage, injury or expense of any kind or nature caused directly or indirectly by any of the Equipment or the use or maintenance thereof or any defect therein, the failure of ope ration thereof or by any interruption of service or loss of use thereof or for any loss of business or damage whatsoever and howsoever caused. Lessor makes no warranty as to the treatment of this Lease for tax or accounting purposes or as to the compliance of the Equipment with applicable government regulations or requirements. Lessee agrees to look solely to the Vendor for any claim arising from any defect, breach of warranty, failure or delay in delivery, mis-delivery or inability to use the Equipment for any reason whatsoever and Lessee’s obligations to Lessor shall not in any manner be affected thereby, including (without limitation) Lessee’s obligations to pay Lessor all rental payments and other amounts payable under any Payment Schedule. Lessee has selected, and will select, both the Equipment and the Vendor and acknowledges that Lessor has not participated in any way in Lessee’s selection of the Equipment or the Vendor. Lessor has no obligation to install, erect, test, adjust, service or maintain the Equipment. 7. Delivery and Acceptance; Quiet Enjoyment. Lessee shall accept the Equipment for which disbursement is requested from any Escrow Fund upon its delivery and authorizes Lessor to insert on each Payment Schedule the serial numbers and any additional description of the items of Equipment so Page 274 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 3 9/27/2022 Master Equipment Lease-Purchase Agreement delivered. As evidence of that acceptance, Lessee shall execute and deliver to Lessor a Certificate of Acceptance in the form attached as Exhibit A to each Escrow Agreement. Regardless of whether Lessee has furnished a Certificate of Acceptance pursuant to this Paragraph 7, by making a rental payment after its receipt of the Equipment, Lessee shall be deemed to have accepted the Equipment on the date of such rental payment for purposes hereof. During the Lease Term, Lessee shall be entitled to quiet enjoyment of the Equipment, subject to the terms of this Master Lease Agreement. 8. Use of Equipment; Maintenance and Repairs. Lessee shall keep the Equipment within the State at the “Equipment Location” stated in the applicable Payment Schedule and Lessee shall not remove any of the Equipment therefrom without Lessor’s prior written consent. Lessee shall use the Equipment in a careful manner and shall at all times, at its sole expense, keep the Equipment in g ood operating condition, repair and appearance and comply with all laws, ordinances, regulations or requirements of any governmental authority, official, board or department relating to its installation, possession, use or maintenance. Lessee shall not make any alterations, additions, or improvements to the Equipment that are not readily removable without causing damage to or reducing the value of the Equipment. All alterations, additions, or improvements not readily removable shall become property of Lessor. 9. Security Interest; Title to Equipment. (a) The provisions of this Section 9(a) apply generally to all Equipment, regardless of the type, and to each Escrow Fund (if any/applicable): To secure the performance of all of Lessee’s obligations hereunder and under each Payment Schedule, Lessee hereby grants to Lessor, and Lessor shall have and retain, a security interest constituting a first priority and perfected lien and security interest on the Equipment delivered under each Payment Schedule and on a ny attachments, proceeds therefrom. Lessee agrees to execute and deliver such additional documents, including, without limitation, opinions of counsel, financing statements, landlord-tenant or mortgagee waivers, notices and similar instruments, in form satisfactory to Lessor, that Lessor deems necessary or appropriate to establish and maintain its security interest in any Equipment or for the confirmation or perfection of Lessor’s rights hereunder and under the applicable Payment Schedule. As further security therefor, Lessee hereby grants to Lessor a first priority security interest in the cash and negotiable instruments from time to time in each Escrow Fund and all proceeds (cash and non -cash) thereof, and agrees with respect thereto that Lessor shall have all the rights and remedies of a secured party under the applicable provisions of the Uniform Commercial Code as enacted in the applicable state. Lessee, at its expense, will protect and defend Lessee’s rights in the Equipment and Lessor’s rights and i nterests therein and will keep the Equipment free and clear from any and all claims, liens, encumbrances and legal processes of Lessee’s creditors and other persons. Lessor shall have the right during normal hours, upon reasonable prior notice to Lessee, to enter upon the premises where the Equipment is located in order to inspect the Equipment. (b) Solely with respect to Equipment that is not comprised of vehicles and during any Lease Term, ownership and legal title of all of the Equipment and all substitutions, repairs, modifications, and replacements shall be in Lessee, and Lessee shall take all necessary action to vest such ownership and title in Lessee. Lessor does not own such Equipment, and, by this Lease Agreement, Lessor is merely financing the acquisition of the Equipment for the Lessee. Lessor has not been in the chain of title, does not, and will not, operate, control or have possession or control over the Equipment, or Lessee’s use, maintenance, operation, storage, or maintenance of the Equipment. Lessee is entitled to use and possession of the Equipment, subject to the rights of Lessor hereunder (including its interest in the Equipment as the lessor hereunder). If Lessor terminates this Master Lease Agreement or any Payment Schedule pursuant to Paragraph 17 hereof or an Event of Nonappropriation occurs, all rights, title, and interests in the Equipment shall immediately vest in Lessor free and clear of any right, title or interest of Lessee. Lessee, at its expense, will protect and defend Lessee’s rights in the Equipment and Lessor’s rights and interests therein and will keep the Equipment free and clear from any and all claims, liens, encumbrances and legal processes of Lessee’s creditors and other persons. Page 275 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 4 9/27/2022 Master Equipment Lease-Purchase Agreement (c) Solely with respect to Equipment consisting of vehicles, the provisions of this Section 9(c) shall apply: Lessee agrees to either cause the original registration to reflect Lessor or its assignee as legal owner of the Equipment or endorse the certificate of ownership to show Lessor or its assignee as legal owner (as required by Section 6301 of the California Vehicle Code). Lessee agrees to execute and deliver such additional documents, including, without limitation, opinions of counsel, MSOs/Certificates of Origin, Title Applications, notices and similar instruments, in form satisfactory to Lessor, that Lessor deems necessary or appropriate to establish and maintain its security interest in such Equipment or for the confirmation or perfection of Lessor’s rights hereunder and under the applicable Payment Schedule. During any Lease Term, Lessee shall be the owner (as defined in Section 460 of the California Vehicle Code) of the Equipment entitled to use and possession of such Equipment, subject to the rights of Lessor hereunder , which is the legal owner (as defined in Section 370 of the California Vehicle Code) of the Equipment. If Lessor terminates this Lease Agreement pursuant to Paragraph 17 hereof or an Event of Nonappropriation occurs, all rights, title, and interests in the specified Equipment shall immediately vest in Lessor free and clear of any right, title or interest of Lessee. 10. Personal Property. The Equipment shall be and remain personal property notwithstanding the manner in which it may be attached or affixed to realty. Lessee covenants that, unless Lessee owns the premises in which the Equipment is to be located and such premises are not subject to any mortgage or lease. At Lessor’s request, Lessee shall provide Lessor with a waiver from each landlord and/or mortgagee of the premises in which any Equipment is to be located of any rights that such landlord and/or mortgagee may have in respect of any of that Equipment. 11. Purchase of Equipment by Lessee; Prepayment. At the option of Lessee, and provided that no Event of Default has occurred and is continuing hereunder, Lessor’s interest in all, but not less than all, of the Equipment described in a particular Payment Schedule will be transferred, conveyed and assigned to Lessee, and this Lease shall terminate: (a) upon payment in full of the rental payments and all other payments then due under that particular Payment Schedule, or (b) on any rental payment date under the particular Payment Schedule, provided Lessee shall have delivered written notice at least 30 days prior to such date of Lessee’s intention to purchase the Equipment pursuant to this provision, by paying to Lessor, in addition to the rental payment due on such date, an amount equal to the concluding payment (the “Concluding Payment”) shown for such rental payment date in the particular Payment Schedule. Lessee shall not have the option to purchase any Equipment as provided in the foregoing clause (b) on any rental payment date for which a Concluding Payment is not stated in the applicable Payment Schedule. 12. Risk of Loss. Lessee shall bear the entire risk of loss, theft, destruction of or damage to the Equipment or any part thereof from any cause whatsoever during any Lease Term and thereafter until redelivery to a location designated by Lessor, and shall not be relieved of the obligation to pay rental payments or any other obligation hereunder and under any Payment Schedule because of any such occurrence. If (a) the Equipment or any portion thereof is destroyed (in whole or in part) or is damaged by fire or other casualty or (b) title to, or the temporary use of, the Equipment or any part thereof hereunder is taken under the exercise of the power of eminent domain, Lessee shall immediately notify Lessor. Lessee and Lessor shall cause the net proceeds of any insurance claim (including self-insurance) or condemnation award to be applied, at Lessor’s option, to (i) the prompt repair, restoration, modification or replacement of the applicable Equipment so affected or (ii) the payment in full of the then applicable Concluding Payment. Any balance of net proceeds remaining after completion of such work or payment of such Concluding Payment shall be paid promptly to Lessee. If the net proceeds are insufficient to pay the costs of such repair, restoration, modification or replacement or to pay such Concluding Payment in full, Lessee shall, at Lessor’s direction and sole discretion, either complete the work or pay the then applicable Concluding Payment in full, and in either case pay any cost in excess of the amount of net proceeds, but only from legally available funds. Page 276 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 5 9/27/2022 Master Equipment Lease-Purchase Agreement 13. Insurance. (a) Insurance Policies. If Lessee is not self-insured (as hereafter provided), Lessee shall, at its expense, keep all Equipment fully insured against loss, fire, theft, damage or destruction from any cause whatsoever in an amount not less than the greater of (a) the total rental payments for the Lease Term under the applicable Payment Schedule for the Equipment listed on that Payment Schedule, and (b) the full replacement cost of that Equipment without consideration for depreciation. Lessee shall also provide such additional insurance against injury, loss or damage to persons or property arising out of the use or operation of the Equipment as is customarily maintained by the owners of like property, with companies satisfactory to Lessor. Each policy shall provide that, as to the interest or coverag e of Lessor or Lessor’s assignee, the insurance afforded thereby shall not be suspended, forfeited or in any manner prejudiced by any default or by any breach of warranty, condition or covenant on the part of Lessee. If Lessee shall fail to provide any such insurance required hereunder or, within ten (10) days after Lessor’s request therefor, shall fail to deliver the policies or certificates thereof to Lessor, then Lessor, at its option, shall have the right to procure such insurance and to add the full cost thereof to the rental payment next becoming due, which Lessee agrees to pay as additional rent under the applicable Payment Schedule. All such insurance shall be in form, issued by such insurance companies and be in such amounts as shall be satisfactory to Lessor, and shall provide that losses, if any, shall be payable to Lessor and its successors and/or assigns as “loss payee,” and all such liability insurance shall name Lessor and its successors and/or assigns as an “additional insured.” Lessee shall pay the premiums for such insurance and deliver to Lessor a certification in the form of Exhibit B-1 and satisfactory evidence of the insurance coverage required hereunder on or before the Commencement Date of the applicable Payment Schedule, but in no event later than the date on which an Acceptance Certificate is executed with respect to any Equipment. Lessee hereby irrevocably appoints Lessor as Lessee’s attorney-in-fact to make claim for, receive payments of and execute and endorse all documents, che cks or drafts received in payment for loss or damage under any such insurance policy. (b) Self-Insurance. If Lessee is self-insured (including any self-insured retentions and deductibles or participation in a risk pool) with respect to equipment such as the Equipment, the Equipment will be self-insured under an actuarially sound self-insurance program that is subject to Lessor’s prior written consent and approval. If the Lessee shall maintain during the Lease Term under the applicable Payment Schedule such actuarially sound self-insurance program and in lieu of the coverage required under Section 13(a) hereunder, Lessee will, at all times, provide Lessor a certification in the form of Exhibit B-2 together with evidence of the self-insurance program in form and substance satisfactory to Lessor. The approval of self-insurance, self-insured retentions, and deductibles are all subject to Lessor’s approval and prior written consent, which shall be based on the Lessor’s then current credit underwriting practices. 14. Fees; Taxes and Other Governmental Charges; Liens. Lessee covenants and agrees at all times to keep the Equipment free and clear of all levies, liens (other than those created hereunder) and encumbrances, and to pay all charges, taxes and fees (including any recording or stamp fees or taxes) that may now or hereafter be imposed upon the ownership, leasing, rental, sale, purchase, possession or use of the Equipment and shall give Lessor immediate written notice of any of the foregoing. If any of same shall remain unpaid when due, Lessor may pay same and add such payment to the rental payment next becoming due under the applicable Payment Schedule, as additional rent. Lessee shall execute and deliver to Lessor upon Lessor’s request such further instruments and documents containing such other assurances as Lessor deems necessary or advisable for the confirmation or perfection of Lessor’s rights hereunder and under the applicable Payment Schedule or to otherwise effectuate the intent of this Master Lease Agreement and the Lease. 15. Indemnification. (a) To the extent authorized by law, Lessee shall indemnify and save Lessor, its officers, employees, agents, servants, successors and assigns, harmless from any and all liabilities (including, without limitation, negligence, tort and strict liability), damages, expenses, claims, actions, proceedings, judgments, settlements, losses, liens and obligations, including (without limitation) attorneys’ fees and costs (“Claims”), arising out of the ordering, purchase, delivery, rejection, non-delivery, ownership, Page 277 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 6 9/27/2022 Master Equipment Lease-Purchase Agreement selection, possession, operation, control, use, condition, maintenance, transportation, storage, repair, return or other disposition of the Equipment, any claims arising under federal, state or local environmental protection and hazardous substance clean up laws and regulations and any claims of patent, trademark or copyright infringement or, if Lessee shall be in default hereunder or under any Payment Schedule, arising out of the condition of any item of Equipment sold or disposed of after use by Lessee, including (without limitation) claims for injury to or death of persons and for damage to property. The indemnities, assumption of liabilities and obligations herein provided shall be payable solely from funds legally available for such purpose and shall continue in full force and effect notwithstanding the expiration, termination or cancellation of this Master Lease Agreement or any Payment Schedule for any reason whatsoever. However, Lessee shall not be obligated to indemnify Lessor from Claims arising from the actual, proven and proximate gross negligence, bad faith, fraud or willful misconduct of Lessor. (b) Lessor’s Indemnification of Lessee. Lessor shall indemnify, defend, and hold harmless Lessee, its Governing Board, boards, commissions, officials, employees, and volunteers (“Indemnitees”) from and against any and all Claims arising from or in any manner connected to Lessor's willful misconduct or any grossly negligent act or omission, whether al leged or actual, regarding performance of services or work conducted or performed pursuant to this Master Lease Agreement or any Payment Schedule. If Claims are filed against Indemnitees that allege negligence on behalf of Lessor, Lessor shall have no rig ht of reimbursement against Indemnitees for the costs of defense even if gross negligence is not found on the part of Lessor. However, Lessor shall not be obligated to indemnify Indemnitees from Claims arising from the negligence or willful misconduct of Indemnitees. 16. Assignment; Subleasing. LESSEE SHALL NOT ASSIGN, PLEDGE, MORTGAGE, SUBLET OR OTHERWISE TRANSFER OR ENCUMBER ANY OF ITS RIGHTS UNDER THIS MASTER LEASE AGREEMENT OR ANY PAYMENT SCHEDULE, ANY ESCROW AGREEMENT (INCLUDING ANY ESCROW FUND CREATED THEREUNDER) OR IN THE EQUIPMENT OR ANY PART THEREOF, NOR PERMIT ITS USE BY ANYONE OTHER THAN LESSEE AND ITS REGULAR EMPLOYEES, WITHOUT LESSOR’S PRIOR WRITTEN CONSENT, WHICH MAY BE WITHHELD OR CONDITIONED IN LESSOR’S REASONABLE DISCRETION. ANY SUCH PURPORTED TRANSFER, ASSIGNMENT OR OTHER ACTION WITHOUT LESSOR’S PRIOR WRITTEN CONSENT SHALL BE VOID. Lessor may, at any time and from time to time, assign, transfer or otherwise convey all or any part of its interest in any Equipment, this Master Lease Ag reement, any Payment Schedule and any Escrow Agreement (including any Escrow Fund created thereunder), including, but not limited to, Lessor’s rights to receive the rental payments under the applicable Payment Schedule or any part thereof (in which event Lessee agrees to make all rental payments thereafter to the assignee designated by Lessor) without the necessity of obtaining Lessee’s consent, provided, however, Lessor will deliver to Lessee prior written notice of an assignment. No such assignment, transfer or conveyance shall be effective until Lessee shall have received a written notice of assignment that discloses the name and address of each such assignee. During the term of this Lease, Lessee shall keep, or cause to be kept, a complete and accurate record of all such assignments with respect hereto in form necessary to comply with Section 149 of the Internal Revenue Code of 1986, as amended (the “Code”). Lessee agrees (unless otherwise stated), if so requested, to acknowledge any such assignment in writing within 15 days after request therefor in the form attached as Exhibit A-1 hereto. Lessee further agrees that any moneys or other property received by Lessor as a result of any such assignment, transfer or conveyance shall not inure to Lessee’s benefit. 17. Events of Default; Remedies. Each of the following events constitutes an “Event of Default” hereunder: (a) Lessee fails to pay in full the rental payment due under any Payment Schedule on any date upon which such rental payment is due; (b) Lessee fails to comply with any other agreement or covenant of Lessee hereunder or under any Payment Schedule for a period of 30 days following receipt of written notice of violation of such agreement or covenant and demand that such violation be remedied; (c) Lessee institutes any proceedings under any bankruptcy, insolvency, reorganization or similar law or a receiver or similar officer is appointed for Lessee or any of its property; (d) any warranty, representation or Page 278 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 7 9/27/2022 Master Equipment Lease-Purchase Agreement statement made in writing by or on behalf of Lessee in connection herewith or in connection with any Payment Schedule is found to be incorrect or misleading in any material respect on the date made; (e) actual or attempted sale, lease or encumbrance of any of the Equipment or the making of an y levy, seizure or attachment thereof or thereon; or (f) Lessee defaults in its obligations under any other agreement for borrowing money, lease financing of property, or otherwise receiving credit and the obligee thereunder (or trustee on its behalf) is permitted to exercise any remedies under such other agreement. Immediately upon the occurrence of an Event of Default hereunder, Lessor may terminate this Master Lease Agreement, the applicable Payment Schedule, the Lease, or Lessee’s rights hereunder and i n any such event repossess the applicable Equipment, which Lessee hereby agrees, at its expense, to surrender promptly to Lessor at such location in the continental United States as Lessor shall direct. Such right of repossession and other rights as specifically provided in this Paragraph 17 shall constitute the sole remedies for Lessee’s failure to make payments or otherwise perform its obligations when required hereunder and under any Payment Schedule. If Lessor is entitled to repossess the Equipment under any provision of this Master Lease Agreement, Lessee shall permit Lessor or its agents to enter the premises where the Equipment is then located. In the event of any such repossession, Lessee shall execute and deliver such documents as may reasonably be required to restore title to and possession of the Equipment to Lessor, free and clear of all liens and security interests to which the Equipment may have become subject. Upon repossession, if the Equipment is damaged or otherwise made less suitable for the purposes for which it was manufactured than when delivered to Lessee, Lessee agrees, at its option, to (a) repair and restore the Equipment to the same condition in which it was received by Lessee (reasonable wear and tear excepted) or (b) pay to Lessor the reasonable costs of such repair and restoration. If Lessor sells or otherwise liquidates the Equipment following an Event of Default or an Event of Nonappropriation as herein provided and realizes net proceeds (after payment of costs) in excess of total rental payments for such Equipment that would have been paid during the applicable Lease Term plus any other amounts then due hereunder, Lessor shall immediately pay the amount of any such excess to Lessee. If Lessor terminates this Master Lease Agreement, any Payment Schedule and/or the Lease under this Paragraph 17 or an Event of Nonappropriation occurs hereunder and in either case Lessee continues to use the Equipment or if Lessee otherwise refuses to pay rental payments hereunder due during a Fiscal Year for which Lessee’s governing body has appropriated sufficient legally available funds to pay such rental payments due hereunder, Lessor (i) may declare the rental payments due and owing for the Fiscal Year for which such appropriations have been made to be immediately due and payable and (ii) shall be entitled to bring such action at law or in equity to recover money and other damages attributable to such holdover period for the Equipment. Lessor shall also be entitled to exercise any or all remedi es available to a secured party under the applicable provisions of the Uniform Commercial Code as enacted in the applicable state, and all other rights and remedies that Lessor may have at law or in equity. All rights and remedies of Lessor shall be cumulative and not alternative. Lessor’s failure to exercise or delay in exercising any right or remedy shall not be construed as a waiver thereof, nor shall a waiver on one occasion be construed to bar the exercise of any right or remedy on a future occasion. Lessee agrees to reimburse Lessor for any expenses reasonably incurred by Lessor with respect to the enforcement of any of the remedies listed above or any other remedy available to Lessor, but only from legally available funds. 18. Late Payments. Whenever any rental payment or other amount payable to Lessor by Lessee under any Payment Schedule is not paid within ten (10) days of the regularly scheduled due date (or if not a regularly scheduled due date, then the due date specified in an undisputed invoi ce), Lessee agrees to pay Lessor a late charge on the delinquent amount at the rate of one percent (1%) per month, or the maximum amount permitted under applicable law, whichever is less. Such amount(s) shall be payable solely from legally available funds in addition to all amounts payable by Lessee as a result of the exercise of any of the remedies herein provided. Page 279 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 8 9/27/2022 Master Equipment Lease-Purchase Agreement 19. Rental Payments to Be Unconditional. Except as expressly set forth in this Master Lease Agreement (including Paragraph 4), Lessee agrees that as of the Commencement Date of any Payment Schedule, Lessee’s obligations under the Lease are absolute and unconditional and shall continue without set-off, deduction, counterclaim, abatement, recoupment, or reduction and regardless of any disability of Lessee to use the Equipment or any part thereof because of any reason including, but not limited to, war, act of God, governmental regulations, strike, loss, damage, destruction, obsolescence, failure of or delay in delivery or failure of the Equipment to operate properly. 20. Tax Covenants. Lessee agrees that it will not take any action that would cause the interest component of rental payments under any Payment Schedule to be or to become ineligible for the exclusion from gross income of the owner or owners thereof for federal income tax purposes, nor will it omit to take or cause to be taken, in a timely manner, any action or omission which would cause the interest component of rental payments under any Payment Schedule to be or to become ineligible for the exclusion from gross income of the owner or owners thereof for federal income tax purposes. Lessee agrees, for each Payment Schedule, to (a) execute and deliver to Lessor, upon Lessor’s request, a tax certificate and agreement in form and content acceptable to Lessor and Lessee, relating to the establishment and maintenance of the excludability from gross income of the interest component of rental payments under the applicable Payment Schedule for federal income tax purposes; (b) complete and file in a timely manner an information reporting return as required by the Code; and (c) rebate an amount equal to excess earnings on any Escrow Fund to the federal government if required by, and in accordance with, Section 148(f) of the Code, and make the determinations and maintain the records required by the Code. Any tax certificate or agreement executed pursuant hereto shall be fully incorporated by reference herein. Lessee represents that neither Lessee nor any agency or unit of Lessee has, or will have, on hand any property, including cash and securities, that is legally required or otherwise restricted (no matter where held or the source thereof) to be used directly or indirectly to purchase the Equipment described in any Payment Schedule. Lessee has no t and will not establish any funds or accounts (no matter where held or the source thereof) the use of which is legally required or otherwise restricted to pay directly or indirectly rental payments under any Payment Schedule. Lessor and Lessee certify that, so long as any rental payments hereunder remain unpaid, moneys on deposit in the Escrow Fund will not be used in a manner that will cause any Payment Schedule to be classified as an “arbitrage bond” within the meaning of Section 148(a) of the Code. If Lessor either (i) receives notice, in any form, from the Internal Revenue Service or (ii) reasonably determines, based on an opinion of nationally recognized independent tax counsel selected by Lessor, that Lessor may not exclude any Interest paid under any Lease from its Federal gross income (each an "Event of Taxability"), the Lessee shall pay to Lessor upon demand (x) an amount which, with respect to Rental Payments previously paid under the Lease and taking into account all penalties, fines, i nterest and additions to tax (including all federal, state and local taxes imposed on the Interest due through the date of such event), will restore to Lessor its after-tax yield (assuming tax at the highest marginal tax rate and taking into account the time of receipt of such Rental Payments and reinvestment at the after-tax yield rate) on the transaction evidenced by such Lease through the date of such event and (y) as additional Rental Payments to Lessor on each succeeding Payment Date such amount as will maintain such after-tax yield to Lessor. It is Lessor’s and Lessee’s intention that this Lease and the Payment Schedules issued under this Master Lease Agreement not constitute a “true” lease for federal income tax purposes and, therefore, it is Lessor’s and Lessee’s intention that Lessee be considered the owner of the Equipment hereunder for federal income tax purposes. 21. Lessee Representations, Warranties and Covenants. Lessee hereby represents and warrants to and agrees with Lessor that: Page 280 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 9 9/27/2022 Master Equipment Lease-Purchase Agreement (a) Lessee is a political subdivision of the State of California, within the meaning of Section 103(c) of the Code, and will do or cause to be done all things necessary to preserve and keep in full force and effect its existence as such. (b) Lessee has the power and authority under applicable law to enter into the transactions contemplated by this Lease, any Payment Schedule and any Escrow Agreement and has been duly authorized to execute and deliver this Lease, all Payment Schedules and all Escrow Agreements and to carry out its obligations hereunder and thereunder. Lessee has provided to Lessor a full, true and correct copy of a resolution or other appropriate official action of Lessee’s governing body specifically authorizing Lessee to execute and deliver this Lease, all Payment Schedules and Escrow Agreements and all documents contemplated hereby and thereby, including the delegation by Lessee’s Governing Board to a designated officer to execute on Lessee’s behalf all future Payment Schedules. Lessee has provide d to Lessor a full, true, and correct copy of an Incumbency Certificate in substantially the form attached as Exhibit D hereto relating to the authority of the officers who have executed and delivered this Master Lease Agreement and who will execute and deliver this Master Lease Agreement on behalf of Lessee. Lessee will provide in the future similar Incumbency Certificates with respect to each Payment Schedule and Escrow Agreement and all documents in connection therewith on behalf of Lessee. (c) All requirements have been met and procedures have occurred in order to ensure the enforceability of this Master Lease Agreement, any Payment Schedule and any Escrow Agreement, and Lessee has complied with such public bidding requirements, if any, as may be applicable to the transactions contemplated by this Master Lease Agreement, any Payment Schedule and any Escrow Agreement. (d) Lessee is not subject to any legal or contractual limitation or provision of any nature whatsoever that in any way limits, restricts or prevents Lessee from entering into this Master Lease Agreement, any Payment Schedule and any Escrow Agreement, or performing any of its obligations hereunder or thereunder, except to the extent that such performance may be limited by bankruptcy, insolvency, reorganization or other laws affecting creditors’ rights generally. (e) There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, known to be pending or threatened against or affecting Lessee, nor to the best knowledge of Lessee is there any basis therefor, wherein an unfavorable decision, ruling or finding would materially adversely affect the transactions contemplated by this Master Lease Agreement, any Payment Schedule or any Escrow Agreement, or any other agreement or instrument to which Lessee is a party and that is used or contemplated for use in the consummation of the transactions contemplated by this Master Lease Agreement, any Payment Schedule or any Escrow Agreement. All authorizations, consents, and approvals of governmental bodies or agencies required in connection with the execution and delivery by Lessee of this Master Lease Agreement or in connection with the carrying out by Lessee of its obligations hereunder, including the subsequent execution of any Payment Schedule, have been obtained. (f) The payment of the rental payments or any portion thereof hereunder is not (under the terms of this Master Lease Agreement and any Payment Schedule) directly or indirectly (i) secured by any interest in property used or to be used in any activity carried on by any person other than a state or local governmental unit or payments in respect of such property; or (ii) on a present value basis, derived from payments (whether or not to Lessee) in respect of property, or borrowed money, used or to be used in any activity carried on by any person other than a state or local governmental unit. The Equipment will not be used, directly or indirectly, in any activity carried on by any person other than a state or local government unit. No portion of the purchase price for the Equipment will be used, directly or indirectly, to make or finance loans to any person other than Lessee. Lessee has not entered into any management or other service contract with respect to the use and operation of the Equipment. (g) The entering into and performance of this Master Lease Agreement, the Lease, and the Escrow Agreement will not violate any judgment, order, law or regulation applicable to Lessee or result in Page 281 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 10 9/27/2022 Master Equipment Lease-Purchase Agreement any breach of, or constitute a default under, or result in the creation of any lien, charge, security interest, or other encumbrance upon any assets of Lessee or on the Equipment pursuant to an indenture, mortgage, deed of trust, bank loan or credit agreement, or other instrument to which Lessee is a party or by which it or its assets may be bound, except as herein provided. (h) Lessee’s name as indicated on the first page of this Master Lease Agreement is its true, correct, and complete legal name. (i) The useful life of any Equipment will not be less than the Lease Term of the Payment Schedule applicable to any such Equipment. (j) Lessee has entered into this Lease, and will enter into each Payment Schedule, for the purpose of purchasing, acquiring, and leasing the Equipment and not for the purpose of refinancing any outstanding obligation of Lessee more than 90 days in advance of its payment or prepayment date. The purchase price for the Equipment has been or will be paid directly by Lessor from the applicable Escrow Fund to the Vendor, and no portion of the purchase price for the Equipment has been or will be paid to Lessee as reimbursement for any expenditure paid by Lessee more than 60 days prior to the execution and delivery hereof. (k) The application, statements, and credit or financial information submitted by it to Lessor are true and correct and made to induce Lessor to enter into this Master Lease Agreement, any Payment Schedules and any Escrow Agreements. (l) For so long as this Master Lease Agreement remains in effect, Lessee shall (i) provide Lessor, no later than ten days prior to the end of each Fiscal Year (commencing with the current Fiscal Year), with current budgets or other proof of appropriation for the ensuing Fiscal Year and such other information relating to Lessee’s ability to continue any current Lease Term for the next succeeding Fiscal Year as may be reasonably requested by Lessor and (ii) furnish or cause to be furnished to Lessor, at Lessee’s expense, as soon as available and in any event not later than 180 days after the close of each Fiscal Year, the audited financial statements of Lessee at the close of and for such Fiscal Year, all in reasonable detail, audited by and with the report of Lessee’s auditor. (m) On each Commencement Date, Lessee shall cause to be executed and delivered to Lessor an Opinion of Lessee’s Counsel for each Payment Schedule in substantially the form attached as Exhibit E hereto. (n) Lessee shall pay the excess (if any) of the actual costs of acquiring the Equipment hereunder over the amount deposited by Lessor in any Escrow Fund and interest earnings thereon. (o) Lessee has experienced no material change in its financial condition since the date of its last prepared financial statements, which was for the fiscal year ended June 30, 2021. (p) Lessee acknowledges that: (a) Lessor is acting solely for its own account and not as a fiduciary for Lessee or in the capacity of broker, dealer, municipal securities underwriter or municipal advisor; (b) Lessor has not provided, and will not provide, financial, legal, tax, accounting or other advice to or on behalf of Lessee with respect to its acquisition of the Equipment; and (c) Lessee has sought and obtained financial, legal, tax, accounting and other advice (including as it relates to structure, timing, terms and similar matters) with respect to this Lease from its financial, legal and other advisors (and not Lessor) to the extent that Lessee desired to obtain such advice. 22. Execution in Counterparts; Chattel Paper. This Master Lease Agreement and any Payment Schedule may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument; provided, however, that only Counterpart No. 1 of this Master Lease Agreement and of any Payment Schedule shall constitute chattel paper for purposes of the applicable Uniform Commercial Code. Page 282 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 11 9/27/2022 Master Equipment Lease-Purchase Agreement 23. Applicable Law. This Master Lease Agreement and each Payment Schedule shall be governed by and construed under the laws of the State of California. 24. Binding Effect; Severability; Survival. This Master Lease Agreement and each Payment Schedule entered into hereunder shall not become effective until accepted by Lessor at its herein-described office, and upon such acceptance shall inure to and bind the parties, their successors, legal representatives, and assigns. No provision of this Master Lease Agreement that may be construed as unenforceable shall in any way invalidate any other provision hereof, all of which shall remain in full force and effect. 25. Miscellaneous Provisions. Any notice to a party hereunder shall be deemed given when mailed to that party by certified mail, return receipt requested, or by overnight deli very by a nationally recognized overnight courier, at its address set forth herein or such other address as either may designate for itself in such notice to the other. This Master Lease Agreement, any Payment Schedule and any Escrow Agreement constitute the entire mutual understanding of the parties regarding the subject matter hereof and thereof and may not be modified except in writing, signed by the party against whom such modification is asserted. Upon the request of Lessor, Lessee shall at any time and from time to time execute and deliver such further documents and do such further acts as Lessor may reasonably request in order fully to effectuate the purposes hereof and any assignment hereof. If a court with competent jurisdiction rules that the interest rate charged hereunder exceeds the maximum rate of interest allowed by applicable law, then the effective rate of interest hereunder shall be automatically reduced to the maximum lawful rate allowable under the applicable laws. [Remainder of page intentionally left blank] Page 283 of 512 City of Arroyo Grande/ Holman Capital Corporation Page 12 9/27/2022 Master Equipment Lease-Purchase Agreement THE UNDERSIGNED HEREBY AGREE TO ALL OF THE TERMS AND CONDITIONS AS SET FORTH IN THIS EQUIPMENT MASTER LEASE-PURCHASE AGREEMENT. HOLMAN CAPITAL CORPORATION, Lessor By: Name: Lance S. Holman Title: President & CEO CITY OF ARROYO GRANDE, Lessee By: Name: Whitney McDonald Title: City Manager Counterpart No. _____ of two manually executed and serially numbered counterparts. To the extent that this Lease Agreement constitutes chattel paper (as defined in the applicable provisions of the Uniform Commercial Code as enacted in the applicable state), no security or ownership interest herein may be created through the transfer or possession of any Counterpart other than Counterpart No. 1. Page 284 of 512 A-1 EXHIBIT A PAYMENT SCHEDULE NO. 1 TO MASTER EQUIPMENT LEASE-PURCHASE AGREEMENT DATED SEPTEMBER 30, 2022 1. DESCRIPTION OF THE EQUIPMENT: Police Ford Explorers with Dash Cameras, Computers and Upfitting Services purchased pursuant to that certain Agreement from Ford Motor Company and financed by this Payment Schedule No. 1 dated September 30, 2022 to that certain Master Equipment Lease-Purchase Agreement dated September 30, 2022 by and between Holman Capital Corporation and City of Arroyo Grande, including, without limitation, the following together with all accessories, attachments, substitutions and accessions. 2. EQUIPMENT LOCATION: 200 N HALCYON ROAD, ARROYO GRANDE, CA 93420 3. RENTAL PAYMENT SCHEDULE: The rental payments shall be made for the Equipment as follows: * Assumes that all rental payments and additional rentals due on and prior to that date have been paid. Rental payments are calculated on the basis of a 360-day year consisting of 12 months of 30 days. 4. INTEREST RATE: 4.57% 5. COMMENCEMENT DATE: SEPTEMBER 30, 2022 6. SCHEDULED LEASE TERM: 4 Years 7. Lessee’s current Fiscal Year extends from July 1, 2022. 8. The terms and provisions of the Master Equipment Lease-Purchase Agreement described above are hereby incorporated into this Payment Schedule by reference and made a part hereof. 9. Lessee hereby consents to the assignment by the Lessor of its rights under this Payment Schedule, which rights are evidenced by the Assignment Agreement entered into concurrently with this Payment Schedule. 10. Lessee hereby represents, warrants, and covenants that (i) its representations, warranties, and covenants set forth in the Master Equipment Lease -Purchase Agreement (particularly Paragraph 21 thereof) are true and correct as though made on the date of execution of this Schedule, and (ii) sufficient Description Quantity Cost % of Total Vendor 2023 Ford Explorers 9 504,300.24$ 67.59%Mullahey Ford Arroyo Grande Dash Camera System 9 60,355.00$ 8.09%COBAN Technologies Mobile Data Computers 9 32,088.61$ 4.30%Code3 Technologies Vehicle Upfitting Services 1 149,358.35$ 20.02%Dana Safety Supply SubTotal 746,102.20$ 100.00% Documentation Fee 3,000.00$ Total Financing 749,102.20$ PAYMENT NO.DATE PAYMENT INTEREST COMPONENT PRINCIPAL COMPONENT CONCLUDING PAYMENT 0 9/30/2022 1 12/1/2022 201,583.34$ 5,895.85$ 195,687.49$ 570,017.15$ 2 12/1/2023 201,583.34$ 25,291.05$ 176,292.29$ 388,436.09$ 3 12/1/2024 201,583.34$ 17,234.49$ 184,348.85$ 198,556.78$ 4 12/1/2025 201,583.34$ 8,809.77$ 192,773.57$ -$ Grand Totals 806,333.36$ 57,231.16$ 749,102.20$ -$ Page 285 of 512 A-2 funds have been appropriated by Lessee for the payment of all rental payments due under this Payment Schedule during Lessee’s current Fiscal Year. 11. Interest, if any, accruing from the Commencement Date hereof to the actual date of funding shall be retained by Lessor as additional consideration for entering into this Schedule. 12. The following exhibits are incorporated into this Payment Schedule by this reference: Exhibit A-1 – Notice and Acknowledgment of Assignment; Exhibit B-1 – Insurance Coverage Request or, as applicable, Exhibit B-2 – Self-Insurance Rider; Exhibit C – Essential Use Certificate; Exhibit D - Incumbency Certificate; Exhibit E – Opinion of Lessee’s Counsel; Exhibit F – Bank Qualified Certificate; Exhibit G – Post-Issuance Tax Compliance Procedures; Exhibit H – Escrow Agreement; Exhibit I – Resolution of Lessee; Exhibit J – UCC-1 Financing Statement; Exhibit K – Form 8038-G; and Exhibit L – Closing Memorandum. Page 286 of 512 A-3 CITY OF ARROYO GRANDE HOLMAN CAPITAL CORPORATION as Lessee as Lessor By: __________________________________ By:_________________________________ Name: Whitney McDonald Title: City Manager Name: Lance S. Holman Title: President & CEO Counterpart No. _____ of two manually executed and serially numbered counterparts. To the extent that this Schedule constitutes chattel paper (as defined in the applicable provisions of the Uniform Commercial Code as enacted in the applicable state), no security or ownership interest herein may be created through the transfer or possession of any Counterpart other than Counterpart No. 1. Page 287 of 512 A-1-1 EXHIBIT A-1 NOTICE AND ACKNOWLEDGEMENT OF SALE OF RENTAL PAYMENTS AND ASSIGNMENT OF PAYMENT SCHEDULE NO. 1 AND ESCROW AGREEMENT Holman Capital Corporation (“Lessor”) and the City of Arroyo Grande (“Lessee”) have entered into a Master Equipment Lease-Purchase Agreement dated September 30, 2022 (the “Master Lease Agreement”) and Payment Schedule No. 1 issued thereunder, under which Lessee has, or will have prior to its execution hereof, leased vehicles and equipment (collectively, the “Equipment”) described in that Payment Schedule. Lessee is hereby notified that Lessor has assigned its right, title, and interest in and to Payment Schedule No. 1, the leased Equipment, and the rental payments as permitted by Payment Schedule No. 1 in accordance with the Master Lease Agreement. Lessee is hereby directed to pay any and all rental payments and other amounts due under Payment Schedule No. 1 to Community Bank of Santa Maria and/or its affiliates, as Lessor’s assignee (the “Assignee”), as directed by the Assignee or a paying agent acting on behalf of Assignee, pursuant to the instructions contained in any invoice or notice. Lessee will also direct any and all correspondence, notice and servicing requests to the Assignee at the following address: Community Bank of Santa Maria Attn: Loan Servicing Department PO Box 5307 Santa Maria, CA 93456 By signing this Notice and Acknowledgment, Lessee agrees that it will pay all amounts due under Payment Schedule No. 1 as directed in the invoice without any set-off or deduction whatsoever notwithstanding any defect in, damage to or requisition of any of the Equipment leased under Payment Schedule No. 1, any other similar or dissimilar event, any defense, set-off, counterclaim or recoupment arising out of any claim against Lessor or Assignee. Lessee further acknowledges and agrees that Assignee has not assumed any of Lessor’s obligations or duties under the Master Lease Agreement or Payment Schedule No. 1, or made any warranties whatsoever as to the Master Lease Agreement, Payment Schedule No. 1 or the Equipment. Lessee agrees that no change may be made to the Master Lease Agreement or Payment Schedule No. 1 without the prior written consent of Assignee. By signing this Notice and Acknowledgment, Lessee warrants that its representations and warranties under the Lease Agreement are true and correct on the date hereof. Date: September 30, 2022 CITY OF ARROYO GRANDE, as Lessee By: _______________________________________ Name: Whitney McDonald Title: City Manager Page 288 of 512 B-1 EXHIBIT B-1 INSURANCE CERTIFICATION [complete only if Lessee is not self-insured] Holman Capital Corporation 25231 Paseo de Alicia, Suite 105 Laguna Hills, CA 92653 September 30, 2022 Re: Payment Schedule No. 1 under Master Equipment Lease-Purchase Agreement dated September 30, 2022 In connection with the above-referenced Payment Schedule No. 1 and Master Lease Agreement, City of Arroyo Grande, as lessee (the “Lessee”) certifies that it has instructed the insurance agent named below (please fill in name, address, and telephone number): Name of Agent: Alliant Insurance Services, Inc. Address: 2180 Harvard Street Suite 460, Sacramento, CA 95815 Phone: 916-643-2715 to issue: X Liability Insurance. Lessee is required to maintain public liability insurance, personal injury and property damage with policy limits of $1,000,000. The policy should be endorsed to name Community Bank of Santa Maria (the assignee of Holman Capital Corporation) as an additional insured. X Casualty Insurance. Lessee is required to maintain all risk extended coverage, malicious mischief and vandalism insurance for the Equipment described in the above-referenced Payment Schedule in an amount not less than the greater of $749,102.20 or the full replacement cost of the Equipment. Such insurance shall be endorsed to name Community Bank of Santa Maria as a co-loss payee with respect to such Equipment. The required insurance should also be endorsed to give Community Bank of Santa Maria at least 30 days’ prior written notice of the effective date of any material alteration or cancellation of coverage, and an endorsement confirming that the interest of Community Bank of Santa Maria shall not be invalidated by any actions, inactions, breach of warranty or conditions or negligence of Lessee. Proof of insurance coverage will be provided to Community Bank of Santa Maria prior to and/or commensurate with the later of the Commencement Date of Payment Schedule No. 1 or the delivery and acceptance of the Equipment. Very truly yours, CITY OF ARROYO GRANDE, as Lessee By: _______________________________________ Name: Whitney McDonald Title: City Manager Page 289 of 512 B-2 EXHIBIT B-2 [complete only if Lessee is self-insured] Holman Capital Corporation 25231 Paseo de Alicia, Suite 105 Laguna Hills, CA 92653 <DATE> Re: Payment Schedule No. 1 under Master Equipment Lease-Purchase Agreement dated September 30, 2022 In connection with the above-referenced Payment Schedule No. 1, City of Arroyo Grande as lessee (the “Lessee”) certifies that it participates in an actuarially sound self-insurance program for property damage and public liability risks. The following is attached (check all that apply):  Letter from risk manager describing self-insurance program  Other evidence of Lessee’s participation in self-insurance program Very truly yours, CITY OF ARROYO GRANDE, as Lessee By: _______________________________________ Name: Whitney McDonald Title: City Manager Page 290 of 512 C-1 EXHIBIT C ESSENTIAL USE CERTIFICATE Holman Capital Corporation 25231 Paseo de Alicia, Suite 105 Laguna Hills, CA 92653 September 30, 2022 Re: Payment Schedule No. 1 under Master Equipment Lease-Purchase Agreement dated September 30, 2022 I, Whitney McDonald, appointed, or designated representative and City Manager of the City of Arroyo Grande, as lessee (the “Lessee”), am qualified to answer the questions set forth below regarding the Equipment to be acquired by Lessee in connection with the above-referenced Payment Schedule: 1. What is the specific use of the Equipment? Police patrol vehicles will be used to provide public safety services, including crime prevention and emergency response. 2. What increased capabilities will the Equipment provide? New Police patrol vehicles with Dash Cameras and upgraded computers will increase conviction rates as it collects evidence of value. These vehicles will enhance officer safety when responding to emergency calls and other public safety situations. 3. Why is the Equipment essential to your ability to deliver governmental services? Providing public safety services requires patrol officers to rely on reliable vehicles when responding to emergencies and volatile situations. Upgraded vehicle safety equipment provides additional safety features for responding officers. 4. Does the Equipment replace existing equipment? (If so, please explain why you are replacing the existing equipment) The new Police patrol vehicles are replacing patrol vehicles that are over 5 years old and have exceeded the mileage limit set for safety standards. 5. Why did you choose this specific Equipment? The City’s procurement procedures require making purchases from bidders that meet the City’s specifications and offer goods or services for the lowest price. 6. For how many years do you expect to utilize the Equipment? The new Police patrol vehicles with upgraded safety equipment are expected to be in service for four to six years. Very truly yours, CITY OF ARROYO GRANDE, as Lessee By: __________________________________________ Name: Whitney McDonald Title: City Manager Page 291 of 512 D-1 EXHIBIT D INCUMBENCY CERTIFICATE I, Nicole Valentine, do hereby certify that I am the Director of Administrative Services of the City of Arroyo Grande (“District”), which is a body corporate and politic duly established and validly existing as a political subdivision of the State of California and operates under a Governing Board, and that I have custody of the records of such entity. I hereby certify that, as of the date hereof, the individuals named below are the duly elected or appointed officers of the District holding the offices set forth opposite thei r respective names. I further certify that: (i) The signatures set opposite their respective names and titles are their true and authentic signatures, and (ii) Such officers have the authority on behalf of such entity to: a. Enter into that certain Payment Schedule No. 1 under Master Equipment Lease- Purchase Agreement dated September 30, 2022 the “Lease Agreement”), between the City of Arroyo Grande and Holman Capital Corporation, as lessor, and that certain Escrow Agreement dated as of September 30, 2022 (the “Escrow Agreement”) between the City of Arroyo Grande, Holman Capital Corporation, and Community Bank of Santa Maria, as escrow agent; and b. Execute Certificates of Acceptance, Payment Request/Disbursement Request Forms, and any and all other certificate, documents, and agreements relating to the Master Lease Agreement, Payment Schedule No. 1 and Escrow Agreement applicable to that Payment Schedule. NAME TITLE SIGNATURE Whitney McDonald City Manager IN WITNESS WHEREOF, I have duly executed this Certificate on behalf of the City of Arroyo Grande. September 30, 2022 By: ______________________________________ Name: Nicole Valentine Title: Director of Administrative Services Page 292 of 512 E-1 EXHIBIT E [Print on Counsel Letterhead] OPINION OF LESSEE’S COUNSEL September 30, 2022 Holman Capital Corporation 25231 Paseo de Alicia, Suite 105 Laguna Hills, CA 92653 Re: Payment Schedule No. 1 under Master Equipment Lease-Purchase Agreement dated September 30, 2022 Ladies and Gentlemen: As counsel to the City of Arroyo Grande (the “Lessee”), I have examined the Master Equipment Lease-Purchase Agreement dated September 30, 2022 and Payment Schedule No. 1, both collectively, the “Lease Agreement”), between the Lessee and Holman Capital Corporation, as lessor (“Lessor”), the form of the Escrow Agreement for Payment Schedule No. 1, together with the Disbursement Request Form and Certificate of Acceptance (collectively, the “Escrow Agreement”), and the proceedings taken by the Governing Body of the Lessee to authorize on behalf of the Lessee the execution and delivery of the Master Lease Agreement, Payment Schedule No. 1 and the Escrow Agreement. The Master Lease Agreement, Payment Schedule No. 1 and the Escrow Agreement are herein collectively referred to as the “Transaction Documents.” Based upon the foregoing examination and upon an examination of such other documents and matters of law as I have deemed necessary or appropriate, I am of the opinion that: 1. The Lessee is a political subdivision of the State of California and operates under a Governing Board, and the laws of the State of California with full power and authority to enter into the Transaction Documents. 2. The Transaction Documents have each been duly authorized, executed, and delivered by the Lessee. Assuming due authorization, execution and delivery thereof by Lessor, the Transaction Documents constitute legal, valid, and binding obligations of the Lessee, enforceable against the Lessee in accordance with their respective terms, subject to any applicable bankruptcy, i nsolvency, moratorium or other laws or equitable principles affecting the enforcement of creditors’ rights generally. 3. The Equipment to be leased pursuant to the Lease Agreement constitutes personal property and, when subjected to use by the Lessee, will not be a fixture under applicable law. 4. The Lessee has complied with any applicable public bidding requirements in connection with the Transaction Documents and the transactions contemplated thereby. By proper action, the Governing Body of the Lessee authorized the execution and delivery of the Transaction Documents and certain other matters, which actions were duly taken at a meeting that was held in compliance with all applicable laws relating to the holding of open and public meetings. Page 293 of 512 E-2 5. No litigation or proceeding is pending or, to the best of my knowledge, threatened to restrain or enjoin the execution, delivery, or performance by the Lessee of the Transaction Documents or in any way to contest the validity of the Transaction Documents, to contest or question the creation or existence of the Lessee or the Governing Body of the Lessee or the authority or ability of the Lessee to execute or deliver the Transaction Documents or to comply with or perform its obligations thereunder. There is no litigation pending or, to the best of my knowledge, threatened seeking to restrain or enjoin the Lessee from annually appropriating sufficient funds to pay the rental payments or other amounts contemplated by the Master Lease Agreement and Payment Schedule No. 1. 6. The entering into and performance of the Transaction Documents do not and will not violate any judgment, order, law, or regulation applicable to the Lessee or result in any breach of, or constitute a default under, or result in the creation of any lien, charge, security interest, or other encumbrance upon any assets of the Lessee or on the Equipment (as such term is defined in the Lease Agreement) pursuant to any indenture, mortgage, deed of trust, bank loan or credit agreement, or other instrument to which the Lessee is a party or by which it or its assets may be bound. Notwithstanding the foregoing, upon the due and timely filing of a UCC-1 and a Title Application and/or Certificate of Title (the latter solely with respect to Equipment constituting titled vehicles), the Lessor will have a perfected security interest in the Equipment. This opinion may be relied upon by Lessor and purchasers and assignees of Lessor’s interests in the Lease Agreement. Respectfully submitted, ______________________________________ Page 294 of 512 F-1 EXHIBIT F BANK-QUALIFIED DESIGNATION The City of Arroyo Grande, as lessee, (the “Lessee”) under that certain Master Equipment Lease- Purchase Agreement dated September 30, 2022 and Payment Schedule No. 1 issued thereunder (collectively, the “Lease”) to which this Designation is attached, hereby designates the Lease as a “qualified tax-exempt obligation” for the purposes and within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. The Lessee hereby represents that the Lessee is a “qualified small issuer” in that it reasonably anticipates that the Lessee and other entities that the Lessee controls will not issue tax-exempt obligations (including the Lease) the aggregate principal amount of which exceed $10,000,000 during the calendar year in which the Lease is executed and delivered , and interest commences to accrue thereunder; and that the Lease is being entered into and will be used in connection with public purposes. This Designation is attached to and made a part of the Lease and inures to the benefit of the Lessor and its successors and/or assigned. EXECUTED as of this September 30, 2022. CITY OF ARROYO GRANDE, as Lessee By: ________________________ Name: Whitney McDonald Title: City Manager Page 295 of 512 G-1 EXHIBIT G POST -ISSUANCE TAX COMPLIANCE PROCEDURES Dated: September 30, 2022 The following certificate is delivered in connection with the execution and delivery of Payment Schedule No. 1 issued under the Master Equipment Lease-Purchase Agreement dated September 30, 2022 (the "Master Lease Agreement"), entered into between the City of Arroyo Grande (the "Lessee") and Holman Capital Corporation (the "Corporation"). Capitalized terms used herein have the meanings defined in the Lease Agreement. Section 1. In General. 1.1. This Certificate is executed for the purpose of establishing the reasonable expectations of Lessee as to future events regarding the financing of certain equipment (the “Equipment”) to be acquired by Lessor and leased to Lessee pursuant to and in accordance with Payment Schedule No. 1 executed under the Master Lease Agreement (together with all related documents executed pursuant thereto and contemporaneously herewith, the "Financing Documents"). As described in the Financing Documents, Lessor shall apply $749,102.20 (the “Principal Amount”) toward the acquisition of the Equipment and closing costs, and Lessee shall make Rental Payments under the terms and conditions as set forth in the Financing Documents. 1.2. The individual executing this Certificate on behalf of Lessee is an officer of Lessee delegated with the responsibility of reviewing and executing the Financing Documents, pursuant to the governing board’s approval or other official action of Lessee adopted with respect to the Financing Documents, a copy of which has been delivered to Lessor. 1.3. The Financing Documents are being entered into for the purpose of providing funds for financing the cost of acquiring, equipping and installing the Equipment which is essential to the governmental functions of Lessee, which Equipment is described in said Payment Schedule No. 1. The Principal Amount will be deposited in escrow by Lessor on the date of issuance of the Financing Documents and held by Community Bank of Santa Maria, as escrow agent (the "Escrow Agent") pending acquisition of the Equipment under the terms of that certain Escrow Agreement for Payment Schedule No. 1 dated as of September 30, 2022 (the "Escrow Agreement"), by and between Lessor, Lessee and Escrow Agent. 1.4. Lessee will timely file for each Payment Schedule issued under the Master Lease Agreement a Form 8038-G (or, if the invoice price of the Equipment under such schedule is less than $100,000, a Form 8038-GC) relating to such Lease with the Internal Revenue Service in accordance with Section 149(e) of the Internal Revenue Code of 1986, as amended (the “Code”). 1.5. The Lease is designated a “qualified tax-exempt obligation” for the purposes and within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. In that regard, the Lessee is a “qualified small issuer” in that it reasonably anticipates that the Lessee and other entities that the Lessee controls will not issue tax-exempt obligations (including the Lease) the aggregate principal amount of which exceed $10,000,000 during the calendar year in which the Lease is executed and delivered and interest commences to accrue thereunder; and that the Lease is being entered into and will be used in connection with public purposes. Page 296 of 512 G-2 Section 2. Non-Arbitrage Certifications. 2.1. The Rental Payments due under the Financing Documents will be made with monies retained in Lessee's general operating fund (or an account or subaccount therein). No sinking, debt service, reserve or similar fund or account will be created or maintained for the payment of the Rental Payments due under the Financing Documents or pledged as security therefor. 2.2. There have been and will be issued no obligations by or on behalf of Lessee that would be deemed to be (i) issued or sold within fifteen (15) days before or after the date of issuance of the Financing Documents, (ii) issued or sold pursuant to a common plan of financing with the Financing Documents and (iii) paid out of substantially the same source of funds as, or deemed to have substantially the same claim to be paid out of substantially the same source of funds as, the Financing Documents. 2.3. Lessee does not and will not have on hand any funds that are or will be restricted, segregated, legally required or otherwise intended to be used, directly or indirectly, as a substitute, replacement or separate source of financing for the Equipment. 2.4. No portion of the Principal Amount is being used by Lessee to acquire investments which produce a yield materially higher than the yield realized by Lessor from Rental Payments received under the Financing Documents. 2.5. The Principal Amount does not exceed the amount necessary for the governmental purpose for which the Financing Documents were entered into. Such funds are expected to be needed and fully expended for payment of the costs of acquiring, equipping and installing the Equipment. 2.6. Lessee does not expect to convey, sublease or otherwise dispose of the Equipment, in whole or in part, at a date which is earlier than the final Payment Date under the Financing Documents. Section 3. Disbursement of Funds; Reimbursement to Lessee. 3.1 It is contemplated that the entire Principal Amount will be used to pay the acquisition cost of Equipment to the vendors or manufacturers thereof or for any financial advisory or closing costs, provided that, if applicable, a portion of the principal amount may be paid to Lessee as reimbursement for acquisition cost payments already made by it so long as the conditions set forth in Section 3.2 bel ow are satisfied. 3.2. Lessee shall not request that it be reimbursed for Equipment acquisition cost payments already made by it unless each of the following conditions have been satisfied: (a) If applicable, Lessee adopted a resolution or otherwise declared its official intent in accordance with Treasury Regulation § 1.150-2 (a copy of which will be provided to Lessor, if applicable, the “Declaration of Official Intent”), wherein Lessee expressed its intent to be reimbursed from the proceeds of a borrowing for all or a portion of the cost of the Equipment, which expenditure was paid to the Vendor (as defined in the Master Lease Agreement) not earlier than sixty (60) days before Lessee adopted the Declaration of Official Intent; (b) The reimbursement being requested will be made by a written allocation before the later of eighteen (18) months after the expenditure was paid or eighteen (18) months after the items of Equipment to which such payment relates were placed in service; (c) The entire payment with respect to which reimbursement is being sought is a capital expenditure, being a cost of a type properly chargeable to a capital account under general federal income tax principles; and Page 297 of 512 G-3 (d) Lessee will use any reimbursement payment for general operating expenses and not in a manner which could be construed as an artifice or device under Treasury Regulation § 1.148-10 to avoid, in whole or in part, arbitrage yield restrictions or arbitrage rebate requirements. Section 4. Use and Investment of Funds; Tempo rary Period. 4.1. Lessee has incurred or will incur, within six (6) months from the date of issuance of the Financing Documents, binding obligations to pay an amount equal to at least five percent (5%) of the Principal Amount toward the costs of the Equipment. An obligation is not binding if it is subject to contingencies within Lessee’s control. The ordering and acceptance of the items of Equipment will proceed with due diligence to the date of final acceptance of the Equipment. 4.2. An amount equal to at least eighty-five percent (85%) of the Principal Amount will be expended to pay the cost of the Equipment by the end of the three-year period commencing on the date of this Certificate. No portion of the Principal Amount will be used to acquire investm ents that do not carry out the governmental purpose of the Financing Documents and that have a substantially guaranteed yield of four (4) years or more. 4.3.(a) Lessee covenants and agrees that it will rebate an amount equal to excess earnings on the Principal Amount deposited under the Escrow Agreement to the Internal Revenue Service if required by, and in accordance with, Section 148(f) of the Code, and make the annual determinations and maintain the records required by and otherwise comply with the regulations applicable thereto. Lessee reasonably expects to cause the Equipment to be acquired by September 30, 2023. (b) Lessee will provide evidence to Lessor that the rebate amount has been calculated and paid to the Internal Revenue Service in accordance with Section 148(f) of the Code unless (i) the entire Principal Amount is expended on the Equipment by the date that is the six -month anniversary of the Financing Documents or (ii) the Principal Amount is expended on the Equipment in accordance with the following schedule: At least fifteen percent (15%) of the Principal Amount and interest earnings thereon will be applied to the cost of the Equipment within six months from the date of issuance of the Financing Documents; at least sixty percent (60%) of the Principal Amount and interest earnings thereon will be applied to the cost of the Equipment within 12 months from the date of issuance of the Financing Documents; and one hundred percent (100%) of the Principal Amount and interest earnings thereon will be applied to the cost of the Equipment prior to eighteen (18) months from the date of issuance of the Financing Documents. (c) Lessee hereby covenants that (i) Lessee is a governmental unit with general tax powers; (ii) the Lease is not a “private activity bond” under Section 141 of the Code; (iii) at least ninety-five percent (95%) of the Principal Amount is used for the governmental activities of Lessee; and (iv) the agg regate principal amount of all tax-exempt obligations (including the Lease) issued by Lessee and its subordinate entities, if any, during the current calendar year is not reasonably expected to exceed $10,000,000. Accordingly, the rebate requirements of Section 148(f) of the Code are treated as being met, in lieu of the spending exceptions set forth in paragraph (b) above. Section 5. Escrow Account. The Financing Documents provide that the monies deposited in escrow shall be invested until payments to the vendor(s) or manufacturer(s) of the Equipment are due. Lessee will ensure that such investment will not result in Lessee's obligations under the Financing Documents being treated as an "arbitrage bond" within the meaning of Section 148(a) of the Internal Revenue Code of 1986, as amended (the "Code"), respectively. Any monies which are earned from the investment of these funds shall be labeled as interest earned. All such monies will be disbursed on or promptly after the date that Lessee accepts the Page 298 of 512 G-4 Equipment. Lessee acknowledges that the provisions of Sections 2 and 4 herein are particularly applicable when the Principal Amount is funded into an Escrow Fund subject to the Escrow Agreement. Section 6. No Private Use; No Consumer Loan . 6.1. Lessee will not exceed the private use restrictions set forth in Section 141 of the Code. Specifically, Lessee will not permit more than 10% of the Principal Amount to be used for a Private Business Use (as defined herein) if, in addition, the payment of more than ten percent (10%) of the Principal Amount plus interest earned thereon is, directly or indirectly, secured by (i) any interest in property used or to be used for a Private Business Use or (ii) any interest in payments in respect of such property or derived from any payment in respect of property or borrowed money used or to be used for a Private Business Use. 6.2 In addition, if both (A) more than five percent (5%) of the Principal Amount is used as described above with respect to Private Business Use and (B) more than five percent (5%) of the Principal Amount plus interest earned thereon is secured by Private Business Use property or payments as described above, then the excess over such five percent (5%) (the “Excess Private Use Portion”) will be used for a Private Business Use related to the governmental use of the Equipment. Any such Excess Private Use Portion of the Principal Amount will not exceed the portion of the Principal Amount used for the governmental use of the particular project to which such Excess Private Use Portion is related. For purposes of this paragraph 6.2, “Private Business Use” means use of bond proceeds or bond financed-property directly or indirectly in a trade or business carried on by a natural person or in any activity carried on by a person other than a natural person, excluding, however, use by a state or local governmental unit and excluding use as a member of the general public. 6.3. No part of the Principal Amount or interest earned thereon will be used, directly or indirectly, to make or finance any loans to non-governmental entities or to any governmental agencies other than Lessee. Section 7. No Federal Guarantee. 7.1. Payment of the principal or interest due under the Financing Documents is not directly or indirectly guaranteed, in whole or in part, by the United States or an agency or instrumentality thereof. 7.2. No portion of the Principal Amount or interest earned thereon shal l be (i) used in making loans the payment of principal or interest of which are to be guaranteed, in whole or in part, by the United States or any agency or instrumentality thereof, or (ii) invested, directly or indirectly, in federally insured deposits or accounts if such investment would cause the financing under the Financing Documents to be "federally guaranteed" within the meaning of Section 149(b) of the Code. Section 8. Miscellaneous. 8.1. Lessee shall keep a complete and accurate record of all owners or assignees of the Financing Documents in form and substance satisfactory to comply with the registration requirements of Section 149(a) of the Code unless Lessor or its assignee agrees to act as Lessee's agent for such purpose. 8.2. Lessee shall maintain complete and accurate records establishing the expenditure of the Principal Amount and interest earnings thereon for a period of five (5) years after payment in full under the Financing Documents. 8.3. To the best of the undersigned’s knowledge, information and belief, the above expectations are reasonable and there are no other facts, estimates or circumstances that would materially change the expectations expressed herein. 8.4. The Lessee’s Tax Identification Number is: 95-6000668. Page 299 of 512 G-5 IN WITNESS WHEREOF, this Post-Issuance Tax Compliance Procedures Certificate has been executed on behalf of Lessee as of September 30, 2022. CITY OF ARROYO GRANDE, As Lessee By: _________________________________ Name: Whitney McDonald Title: City Manager Page 300 of 512 H-1 EXHIBIT H ESCROW AGREEMENT LESSOR: Holman Capital Corporation 25231 Paseo de Alicia, Suite 105 Laguna Hills, CA 92653 ESCROW AGENT: Community Bank of Santa Maria PO Box 5307 Santa Maria, CA 93456 LESSEE: City of Arroyo Grande 300 E Branch Street Arroyo Grande, CA 93420 THIS ESCROW AGREEMENT (this “Escrow Agreement”) is made as of September 30, 2022, between Holman Capital Corporation (“Lessor”), the City of Arroyo Grande (“Lessee”), and Community Bank of Santa Maria (the “Escrow Agent”). Lessor and Lessee have heretofore entered into that certain Payment Schedule No. 1 (the “Payment Schedule”) under that Master Equipment Lease-Purchase Agreement dated September 30, 2022 (the “Master Lease Agreement”). The Payment Schedule and Master Lease Agreement are jointly referred to herein as the “Lease.” The Lease contemplates that certain Equipment described therein (the “Equipment”) is to be acquired from the vendor(s) or manufacturer(s) thereof. After acceptance of the Equipment by Lessee, the Equipment is to be leased by Lessor to Lessee pursuant to the terms of the Lease. The Lease contemplates that Lessor will deposit with the Escrow Agent cash in the amount of $749,102.20 (the “Deposit Amount”), for deposit into the escrow fund (the “Escrow Fund”), to be held in escrow by the Escrow Agent and applied on the express terms and conditions set forth herein. Such deposit into the Escrow Fund, together with all interest and additions received with respect thereto, is to be applied from time to time to pay the vendor(s) or manufacturer(s) of the Equipment its invoice cost (a portion of which may, if required, be paid prior to final acceptance of the Equipment by Lessee). The Escrow Fund is to be held for the account and benefit of Lessee, and Lessee has granted to Lessor a first priority and perfected lien on and security interest in the Escrow Fund and any all proceeds, interest and other earnings thereon and investments therein to the Lessor by virtue of the execution of this Escrow Agreement and the Lease without the need for any additional filings or financing statements. The parties desire to set forth the terms on which the escrow is to be created and to establish the rights and responsibilities of the parties hereto. NOW, THEREFORE, the parties agree as follows: 1. The Escrow Agent hereby agrees to serve as escrow agent upon the terms and conditions set forth herein. The Escrow Agent agrees that the Escrow Fund shall be held irrevocably in trust for the account and benefit of Lessee and all interest earned with respect to the Escrow Fund shall accrue to the benefit of Lessee and shall be applied as expressly set forth herein. To the limited extent required to perfect the first, priority security interest granted by Lessee to Lessor in the cash and negotiable instruments from time to time held in the Escrow Fund, Lessor hereby appoints the Escrow Agent as its security agent, and the Escrow Agent hereby accepts the Page 301 of 512 H-2 appointment as security agent, and agrees to hold physical possession of such cash and negotiable instruments on behalf of Lessor. 2. On such day as determined to the mutual satisfaction of the parties pursuant to the terms of the Payment Schedule (the “Commencement Date”), Lessor shall deposit with the Escrow Agent cash in the amount of the Deposit Amount to be held by the Escrow Agent on the express terms and conditions set forth herein. The Escrow Agent agrees to accept the deposit of the Deposit Amount by Lessor with the Escrow Agent, and further agrees to hold the amount so deposited together with all interest and other additions received with respect thereto in escrow on the express terms and conditions set forth herein. 3. The Escrow Agent shall at all times segregate the Escrow Fund into an account maintained for that express purpose, which shall be clearly identified on the books and records of the Escrow Agent as being held in its capacity as Escrow Agent. Securities and other negotiable instruments held in the Escrow Fund from time to time shall be held or registered i n the name of the Escrow Agent (or its nominee). The Escrow Fund shall not, to the extent permitted by applicable law, be subject to levy or attachment or lien by or for the benefit of any creditor of any of the parties hereto (except with respect to the security interest therein held by Lessor). 4. Lessee hereby directs the Escrow Agent to invest the cash held in the Escrow Fund from time to time in a Community Bank of Santa Maria non-interest bearing demand deposit account with no fees or costs or, in the event such fund is not at the time available, such other investments as Lessee may specify in writing, to the extent the same are at the time legal for investment of the funds be ing invested. Interest or other amounts earned and received by the Escrow Agent with respect to the Escrow Fund shall be deposited in and become a part of the Escrow Fund. No investment shall be made that would cause the Lease to be deemed to be an arbitrage bond within the meaning of Section 148(a) of the Internal Revenue Code of 1986, as amended. 5. Lessor and Lessee hereby authorize the Escrow Agent to take the following actions with respect to the Escrow Fund: a. From time to time, the Escrow Agent shall pay the vendor or manufacturer of the Equipment payments then due and payable, or reimburse Lessee for amounts that it has paid to the vendor or manufacturer of the Equipment, upon receipt of the following: (a) a duly executed Certificate of Acceptance and Payment Request in the form attached as Exhibit A hereto, (b) the vendor(s) or manufacturer(s) invoice(s) specifying the acquisition price of the Equipment described in the requisition request, and (c) any additional documentation required by Lessor. b. If Lessor provides to the Escrow Agent written notice of the occurrence of an Event of Default or an Event of Nonappropriation by Lessee under the Master Lease Agreement or Payment Schedule, the Escrow Agent shall thereupon promptly remit to Lessor the entire balance of the Escrow Fund. c. Upon receipt by the Escrow Agent of a duly executed Certificate of Acceptance and Payment Request identified as the final such request, the Escrow Agent shall transfer the then remaining balance of the Escrow Fund to Lessee, upon the express condition that Lessee hereby agrees to use such excess amount solely for capital expenditures as shall be approved by Lessee or, at the written direction of Lessee, for application against the interest component of the Lessee’s payment obligation under the Lease, as provided therein, unless otherwise agreed by Lessor. 6. The Escrow Agent shall have no liability for acting upon any written instruction presented by Lessee and Lessor in connection with this Escrow Agreement that the Escrow Agent in good faith believes to be genuine. Furthermore, the Escrow Agent shall not be liable for any act or omission in connection Page 302 of 512 H-3 with this Escrow Agreement except for its own gross negligence, willful misconduct, or bad faith. The Escrow Agent shall not be liable for any loss or diminution in value of the Escrow Fund as a result of the investments made pursuant to Section 4. 7. To the extent authorized by law, Lessee hereby agrees to indemnify and save the Escrow Agent harmless against any liabilities that it may incur in the exercise and performance of its powers and duties hereunder and that are not due to the Escrow Agent’s gross negligence or willful misconduct. No indemnification will be made under this Section or elsewhere in this Escrow Agr eement for damages arising solely out of gross negligence, willful misconduct, or bad faith by the Escrow Agent, its officers, agents, employees, successors or assigns. 8. The Escrow Agent may at any time resign by giving at least 30 days’ prior written no tice to Lessee and Lessor, but such resignation shall not take effect until the appointment of the successor Escrow Agent. The substitution of another bank or trust company to act as Escrow Agent under this Escrow Agreement may occur by written agreement of Lessor and Lessee. In addition, the Escrow Agent may be removed at any time, with or without cause, by instrument in writing executed by Lessor and Lessee. Such notice shall set forth the effective date of the removal. In the event of any resignation or removal of the Escrow Agent, a successor Escrow Agent shall be appointed by an instrument in writing executed by Lessor and Lessee. Such successor Escrow Agent shall indicate its acceptance of such appointment by an instrument in writing delivered to Lessor, Lessee and the predecessor Escrow Agent. Upon the effective date of resignation or removal, the Escrow Agent will transfer the Escrow Fund then held by it to the successor Escrow Agent selected by Lessor and Lessee. 9. This Escrow Agreement shall terminate upon receipt by the Escrow Agent of the written notice from Lessor specified in Section 5(b) or Section 5(c) hereof. 10. All notices hereunder shall be in writing, sent by certified mail, return receipt requested, or by mutually recognized overnight carrier addressed to the other party at its respective address shown on page 1 of this Escrow Agreement or at such other address as such party shall from time to time designate in writing to the other parties; and shall be effective on the date or recei pt. 11. This Escrow Agreement shall inure to the benefit of and shall be binding upon the parties hereto and their respective successors and assigns. No rights or obligations of the Escrow Agent under this Escrow Agreement may be assigned without the prior written consent of Lessor and Lessee. 12. This Escrow Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof, and no waiver, consent, modification, or change of terms hereof shall bind any party unless in writing signed by all parties. 13. The Escrow Agent may employ agents, attorneys and accountants in connection with its duties hereunder and shall not be liable for any action taken or omitted in good faith in accordance with the advice of counsel, accountants, or other skilled persons. 14. This Escrow Agreement shall be governed by and be construed and interpreted in accordance with the internal laws of the State of California. [Remainder of page intentionally left blank] Page 303 of 512 H-4 IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement to be duly executed as of the day and year first above set forth. LESSOR: HOLMAN CAPITAL CORPORATION By: Name: Lance S. Holman Title: President & CEO LESSEE: CITY OF ARROYO GRANDE By: Name: Whitney McDonald Title: City Manager ESCROW AGENT: ESCROW AGENT: COMMUNITY BANK OF SANTA MARIA By: Name: Lisa Canale Title: EVP, Chief Credit Officer Page 304 of 512 H-5 EXHIBIT A TO ESCROW AGREEMENT CERTIFICATE OF ACCEPTANCE AND PAYMENT REQUEST The following payment request is directed to Community Bank of Santa Maria (the “Escrow Agent”), as escrow agent under that certain Escrow Agreement dated September 30, 2022 (the “Escrow Agreement”), between the City of Arroyo Grande (“Lessee”), Holman Capital Corporation (“Lessor”), and the Escrow Agent. Because Holman Capital Corporation has assigned all of its right, title, and interest in and to the Escrow Agreement to Community Bank of Santa Maria, all references herein to “Lessor” shall mean Community Bank of Santa Maria. The Escrow Agent is hereby requested to pay from the Escrow Fund established and maintained under the Escrow Agreement the amount set forth below to the named payee(s). The amount shown is due and payable under a purchase order or contract (or has been paid by and not previously reimbursed to Lessee). The equipment described below is part or all of the Equipment leased pursuant to that certain Payment Schedule No. 1 (the “Payment Schedule”) executed pursuant to the Master Equipment Lease- Purchase Agreement dated September 30, 2022 (the “Master Lease Agreement”), between Lessor and Lessee: QUANTITY DESCRIPTION OF UNITS OF EQUIPMENT AMOUNT PAYEE Lessee hereby certifies and represents to and agrees with Lessor as follows with respect to the Equipment described above: (i) the Equipment has been delivered to the location(s) set forth in the Payment Schedule; (ii) a present need exists for the Equipment, which need is not temporary or expected to diminish in the near future; (iii) the Equipment is essential to and will be used by Lessee only for the purpose of performing one or more governmental functions of Lessee consistent with the permissible scope of Lessee’s authority; (iv) the estimated useful life of the Equipment based upon the manufacturer’s representations and Lessee’s projected needs is not less than the term of the Payment Schedule; (v) Lessee has conducted such inspection and/or testing of the Equipment as it deems necessary and appropriate and hereby acknowledges that it accepts the Equipment for all purposes as of the date of this Certificate; (vi) the Equipment is covered by insurance in the types and amounts required by the Master Lease Agreement; (vii) no Event of Default or Event of Nonappropriation, as those terms are defined in the Master Lease Agreement, and no event that with the giving of notice or lapse of time or both, would become an Event of Default or an Event of Nonappropriation, has occurred and is continuing on the date hereof; and (viii) sufficient funds have been appropriated by Lessee for the payment of all rental payments due under the Payment Schedule during Lessee’s current Fiscal Year. Based on the foregoing, the Escrow Agent is hereby authorized and directed to fund the acquisition of the Equipment set forth above by paying, or causing to be paid, the manufacturer(s)/vendor(s) the amounts set forth on the attached invoices from the Escrow Fund held under the Escrow Agreement in accordance with its terms. The following documents are attached hereto and made a part hereof: (a) Original Invoice(s) and (b) Copies of Certificate(s) of Ownership, designating Lessor as legal owner, and evidence of filing. Page 305 of 512 H-6 IF REQUEST IS FINAL REQUEST, CHECK HERE . The undersigned hereby certifies that the items of Equipment described above, together with the items of Equipment described in and accepted by Certificates of Acceptance and Payment Requests previously filed by Lessee with Lessor constitute all of the Equipment subject to the Payment Schedule. Date: ______________ Approved: COMMUNITY BANK OF SANTA MARIA, as Lessor CITY OF ARROYO GRANDE, as Lessee By: By: Name: Name: Title: Title: Page 306 of 512 H-7 SCHEDULE A TO ESCROW AGREEMENT: NOTICE AND ACKNOWLEDGEMENT OF ASSIGNMENT OF ESCROW AGREEMENT Holman Capital Corporation ("Lessor"), City of Arroyo Grande ("Lessee"), and Community Bank of Santa Maria ("Escrow Agent") have entered into an Escrow Agreement dated September 30, 2022 (the "Escrow Agreement'), pursuant to which Lessor, or its Assignee (as defined below), has deposited cash into the Escrow Fund established thereunder, which funds are to be used by Lessee to acquire certain Equipment. Escrow Agent is hereby notified that Lessor has assigned all of its right, title, and interest in and to, but not its obligations under, the Escrow Agreement to Community Bank of Santa Maria ("Assignee"), including, in particular, but without limitation, Lessor's security interest in the Escrow Fund and Lessor's right to approve all payment requests submitted by Lessee. Date: September 30, 2022 LESSOR: HOLMAN CAPITAL CORPORATION By: Name: Lance S. Holman Title: President & CEO LESSEE: CITY OF ARROYO GRANDE By: Name: Whitney McDonald Title: City Manager ESCROW AGENT: COMMUNITY BANK OF SANTA MARIA By: Name: Lisa Canale Title: EVP, Chief Credit Officer Page 307 of 512 I-1 EXHIBIT I RESOLUTION OF LESSEE Page 308 of 512 J-1 EXHIBIT J UCC-1 FINANCING STATEMENT Page 309 of 512 K-1 EXHIBIT K IRS FORM 8038-G [To be prepared by Holman Capital Corporation] Page 310 of 512 L-1 EXHIBIT L CLOSING MEMORANDUM $749,102.20 LEASE FOR PUBLIC SAFETY EQUIPMENT PROJECT PURSUANT TO PAYMENT SCHEDULE NO. 1 ISSUED UNDER THE MASTER EQUIPMENT LEASE-PURCHASE AGREEMENT DATED SEPTEMBER 30, 2022 BETWEEN CITY OF ARROYO GRANDE, AS LESSEE, AND HOLMAN CAPITAL CORPORATION, AS LESSOR Pre-Closing: Pre-Closing will be held at the Lessee’s convenience, on or before September 28, 2022. All documents will be executed and two (2) blue ink originals will be overnighted to Holman Capital Corporation, Attn.: Jane Taubman, 25231 Paseo De Alicia Suite 105 Laguna Hills, CA 92653, for delivery no later than 9:00 am on the morning of September 28, 2022 and held in trust until such time as the wires and original documents are released by the Parties. Closing: (1) By internal funds transfer and pending receipt of original, executed Payment Schedule and related documents, on the morning of September 30, 2022, Community Bank of Santa Maria (the Investor) is authorized by Lessee to transfer via internal credit the Total Equipment Cost (as set forth below) to Escrow Agent, pursuant to a general ledger credit to the Escrow Account as follows: Bank Name: Community Bank of Santa Maria ABA No: 122243237 Account No: XXX1482 Account Name: City of Arroyo Grande (2) By wire transfer and pending receipt of original, executed Payment Schedule and related documents, on the morning of September 30, 2022, the Investor is authorized by Lessee to transfer via wire the Issuance Costs (as defined below) to Lessor as follows: Bank Name: Citizens Business Bank ABA Number: 122234149 Account Number: XXXXX1323 Account Name: Holman Capital Corporation Holman Capital Corporation will confirm disbursement of funds to the Lessee’s escrow account and then release all of the original documents held in trust to the investor and forward a copy to the Lessee. Upon conformation by Escrow Agent of the Lease Proceeds, Lessee will wire closing costs, legal fees and other amounts to the parties in accordance with the invoices attached hereto. Page 311 of 512 L-2 Sources and Uses of Funds: Principal Amount of Lease $749,102.20 TOTAL SOURCES $749,102.20 Total Equipment Cost: $746,102.20 Issuance Costs: $3,000.00 TOTAL LEASE PROCEEDS $749,102.20 LESSEE: CITY OF ARROYO GRANDE By: _____________________________ Name: Whitney McDonald Title: City Manager Page 312 of 512 ATTACHMENT 2 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING FOURTEEN VEHICLES AS SURPLUS AND AUTHORIZING THEIR SALE OR DISPOSAL WHEREAS, the City of Arroyo Grande (“City”) owns eight (8) Ford Explorers, one (1) Dodge Ram truck, one (1) Ford F550 truck, two (2) Dodge Chargers, and two (2) Honda motorcycles which are being replaced; WHEREAS, these items can be classified as surplus property and made available for sale to private parties or disposed of pursuant to State law. NOW THEREFORE BE IT RESOLVED that the City Council of the City of Arroyo Grande does declare as surplus the vehicles and equipment described in Exhibit A attached hereto and incorporated herein by this reference, and authorizes staff to sell/dispose of said vehicles and equipment in compliance with authorized disposition procedures. On motion by Council Member , seconded by Council Member , and on the following roll call vote, to wit: AYES: NOES: ABSENT: the foregoing Resolution was passed and adopted this 27th day of September, 2022. Page 313 of 512 RESOLUTION NO. PAGE 2 CAREN RAY RUSSOM, MAYOR ATTEST: ______________________________________ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: WHITNEY MCDONALD, CITY MANAGER APPROVED AS TO FORM: TIMOTHY J. CARMEL, CITY ATTORNEY Page 314 of 512 RESOLUTION NO. PAGE 3 EXHIBIT A SURPLUS VEHICLES AVAILABLE FOR SALE AND/OR AUCTION 1. Unit 4602: 2017 Ford Explorer VIN: 1FM5K8AT7HGD59206 2. Unit 4603: 2017 Ford Explorer VIN: 1FM5K8AT9HGD59207 3. Unit 4604: 2017 Ford Explorer VIN: 1FM5K8AT0HGD59208 4. Unit 4605: 2017 Ford Explorer VIN: 1FM5K8AT2HGD59209 5. Unit 4606: 2017 Ford Explorer VIN: 1FM5K8AT9HGD59210 6. Unit 4607: 2017 Ford Explorer VIN: 1FM5K8AT0HGD59211 7. Unit 4608: 2017 Ford Explorer VIN: 1FM5K8AT2HGD592012 8. Unit 4609: 2017 Ford Explorer VIN: 1FM5K8AT4HGD59213 9. Unit 4613: 2015 Dodge Ram 1500 VIN: 1C6RR7XT8GS188505 10. Unit 4623: 2001 Ford F550 VIN: 1FDAF56F61EC51231 11. Unit 4612: 2016 Dodge Charger VIN: 2C3CDXAG3GH118558 12. Unit 4611: 2016 Dodge Charger VIN: 2C3CDXAG3GH122271 13. Unit 4620: 2005 Honda Motorcycle VIN: JH2SC51709K600129 14. Unit 4621: 2005 Honda Motorcycle VIN: JH2SC517X9K600123 Page 315 of 512 Item 8.h. MEMORANDUM TO: City Council FROM: Bill Robeson, Assistant City Manager/Public Works Director BY: Jill McPeek, Capital Improvement Project Manager SUBJECT: Consideration to Award Construction Contract to G. Sosa Construction, Inc. for 2022 Pedestrian Crossing Improvement Project, PW 2021-08, and Authorization of Budget Adjustment for $90,618 from Unexpended FY 2021-22 CIP Budget Funds DATE: September 27, 2022 SUMMARY OF ACTION: Awarding a construction contract to G. Sosa Construction, Inc., and allocating an additional $90,618 of unexpended FY 2021-22 Capital Improvement Program budget funds to the project will allow for sidewalk infill and pedestrian improvements at three intersections within the City. Work is anticipated to begin in October 2022 and be completed in January 2023. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The FY 2021-22 and FY 2022-23 Capital Improvement Program (CIP) budget included $250,000 of Highway Safety Improvement Program (HSIP) and $100,000 of Regional State Highway Account (RSHA) funds for the subject project, for a total project cost of $350,000. Upon receipt of construction bids, it is now estimated that the total project costs will be $440,618. The remaining balance of the project is $90,618 and it is proposed to fund this amount with unexpended American Rescue Plan Act (ARPA) and Sales Tax funds from the FY 2021-22 Capital Improvement Program budget. Staff time will be necessary to coordinate construction activities with the design consultant, engineering inspector, and construction contractor. Construction $ 321,202.75 Construction Contingencies 32,120.25 Contract Admin, Ads, Copies 11,910.00 Design & Survey 75,385.00 Total $ 440,618.00 Page 316 of 512 Item 8.h. City Council Consideration to Award Construction Contract to G. Sosa Construction, Inc. for 2022 Pedestrian Crossing Improvement Project, PW 2021-08, and Authorization of Budget Adjustment for $90,618 from Unexpended FY 2021-22 CIP Budget Funds September 27, 2022 Page 2 RECOMMENDATION: 1) Award a construction contract to G. Sosa Construction, Inc. in the amount of $321,202.75 and authorize the City Manager to approve change orders for up to 10% of the contract amount, $32,120.25, for unanticipated costs during the construction phase of the project (construction contract costs = $321,202.75 + $32,120.25 = $353,323); and 2) Approve a budget adjustment to appropriate $90,618 from unexpended FY 2021-22 Capital Improvement Program budget funds to cover the subject project expenditures. BACKGROUND: In 2018, the City was successful in securing $150,000 of RSHA funds through the San Luis Obispo Council of Government’s (SLOCOG’s) Safe Routes to School (SRTS) program for pedestrian improvements in the vicinity of Harloe Elementary School. As part of the 2018 Concrete Repairs project, $50,000 of these funds were used to install sidewalks along Farroll Avenue between Gaynfair Terrace and Alder Street. The remaining $100,000 was earmarked for sidewalk gap closures on South Halcyon Road and pedestrian crossing improvements at Sandalwood Avenue. In 2020, the City was successful in securing $250,000 of State HSIP funds to install pedestrian crossing improvements at three intersections:  South Halcyon Road at Sandalwood Avenue  Farroll Avenue at South Halcyon Road  East Grand Avenue at Alder Street The two grants, totaling $350,000, were combined into one project, and at its July 26, 2022 meeting, the City Council approved the construction plans and specifications for the project (see Attachment 2). Also at this meeting, Council accepted two Public Pedestrian Access Easements and a Grant of Temporary Construction License acquired for the curb ramps at East Grand Avenue at Alder Street in order to meet current American with Disabilities (ADA) standards, and authorized staff to advertise for construction bids pending State approval of the allocation of construction funds. The State funds were allocated on August 4, 2022, and the project was advertised on August 8, 2022. ANALYSIS OF ISSUES: On September 8, 2022, eight bids were received for the 2022 Pedestrian Crossing Improvement Project (Attachment 1). The project specifications state that the lowest bidder will be determined using the Base Bid. There were no Bid Alternates. Following review, it has been determined that the lowest Base Bid was received from G. Sosa Construction, Inc., that G. Sosa Construction, Inc.’s bid is responsive, and that G. Sosa Construction, Inc. is a responsible bidder. Page 317 of 512 Item 8.h. City Council Consideration to Award Construction Contract to G. Sosa Construction, Inc. for 2022 Pedestrian Crossing Improvement Project, PW 2021-08, and Authorization of Budget Adjustment for $90,618 from Unexpended FY 2021-22 CIP Budget Funds September 27, 2022 Page 3 Based on the lowest base bid received, it is estimated that the total project costs will be $440,618, as shown in the table below, which is $90,618 more than what is currently budgeted for the Project. Staff recommends allocating unexpended funds from Fiscal Year 2021-22 Capital Improvement Projects to the Project, as follows:  $24,958.42 of remaining FY 2021-22 ARPA funds from the Chevron Storm Drain project, which has been completed as follows: $ 525,800.00 Budgeted 486,110.87 Expended 14,730.71 To be Used for Project Related Fencing Repairs $ 24,958.42 Remaining / Allocate to Pedestrian Crossings  $10,659.58 of remaining FY 2021-22 Sales Tax funds from the Castillo Del Mar project, which has been completed as follows: $ 694,061.53 Budgeted 683,401.95 Expended $ 10,659.58 Sales Tax Remaining / Allocate to Pedestrian Crossings  $55,000 of FY 2021-22 Sales Tax funding allocated to the Guardrails project that was not completed in FY 2021-22. The following table depicts the current Project costs in light of received bids and the recommending funding sources for the new total project cost of $440,617: Revenue Available Budget Current Estimate Shortfall State HSIP $ 250,000.00 $ 250,000.00 $ 0.00 Regional SHA 100,000.00 100,000.00 0.00 ARPA (251 E Grand Storm Drain) 0.00 24,958.42 24,958.42 Sales Tax (Castillo Del Mar Extension) 0.00 10,659.58 10,659.58 Sales Tax (Guardrail Replacement) 0.00 55,000.00 55,000.00 Total Revenue $ 350,000.00 $ 440,618.00 $ 90,618.00 Page 318 of 512 Item 8.h. City Council Consideration to Award Construction Contract to G. Sosa Construction, Inc. for 2022 Pedestrian Crossing Improvement Project, PW 2021-08, and Authorization of Budget Adjustment for $90,618 from Unexpended FY 2021-22 CIP Budget Funds September 27, 2022 Page 4 Expenditures Construction $ 262,705.00 $ 321,202.75 $ 58,497.75 Construction Contingencies 0.00 32,120.25 32,120.25 Contract Admin, Ads, Copies 11,910.00 11,910.00 0.00 Design & Survey 75,385.00 75,385.00 0.00 Total Expenditures $ 350,000.00 $ 440,618.00 $ 90,618.00 The contract time is 60 working days and it is anticipated work will be performed October 2022 to January 2023. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Award a construction contract to G. Sosa Construction, Inc. in the amount of $321,202.75 and authorize the City Manager to approve change orders for up to 10% of the contract amount, $32,120.25, for unanticipated costs during the construction phase of the project (construction contract costs = $321,202.75 + $32,120.25 = $353,323.00); and approve a budget adjustment to appropriate $90,618.00 from unexpended FY 2021-22 Capital Improvement Program budget funds to cover the subject project expenditures; 2. Award a construction contract to G. Sosa Construction, Inc. in the recommended amounts but approve a budget adjustment to appropriate $90,618 from excess available General Fund balance; 3. Do not approve a construction contract to G. Sosa Construction, Inc.; or 4. Provide other direction to staff. ADVANTAGES: Installation of improvements at uncontrolled pedestrian crossings will address one of the main safety issues in the City (where fatal and severe injury pedestrian to vehicle collisions occur) as identified in the Local Road Safety Plan (LRSP). Installation of sidewalks where none currently exists will provide safe and continuous access for pedestrians in the vicinity of Harloe Elementary School. DISADVANTAGES: There will be intermittent sidewalk closures during the project. These closures will be minimized as much as possible and the project specifications require the contractor to notify affected residents and businesses in advance. In addition, staff will work with Lucia Mar School District and Harloe Elementary School personnel to coordinate disruptions to parents and students accessing the school from Farroll Avenue. Page 319 of 512 Item 8.h. City Council Consideration to Award Construction Contract to G. Sosa Construction, Inc. for 2022 Pedestrian Crossing Improvement Project, PW 2021-08, and Authorization of Budget Adjustment for $90,618 from Unexpended FY 2021-22 CIP Budget Funds September 27, 2022 Page 5 ENVIRONMENTAL REVIEW: The project is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to Guideline Section 15301(c) for repairs and maintenance of existing streets, sidewalks, gutters and similar facilities. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Bid Opening Log Sheet 2. July 26, 2022 Staff Report and Attachments Page 320 of 512 CITY OF ARROYO GRANDE BID OPENING LOG SHEET DEADLINE: THURSDAY, SEPTEMBER 8, 2022 - 2:00 PM PROJECT NAME: 2022 PEDESTRIAN CROSSING IMPROVEMENTS PROJECT NO.: PW 2021-08 ESTIMATED CONSTRUCTION COST: $270,100 ADDENDUM: 2 SUBMITTED BY: TOTAL 1.G. Sosa Construction, Inc.$ 321,202.75 Nipomo, CA 2.DOD Construction LTD $ 358,856.50 Bakersfield, CA 3.Spiess Construction Co., Inc.$ 465,377.00 Santa Maria, CA 4.J.J. Fisher Construction, Inc.$ 376,628.65 Nipomo, CA 5.The J.F. Will Company, Inc.$ 376,226.30 Santa Maria, CA 6.Souza Construction $ 374,758.50 San Luis Obispo, CA 7.Brough Construction, Inc.$ 397,192.00 Arroyo Grande, CA 8.R. Burke Corporation $ 488,906.00 San Luis Obispo, CA ______________________________ Jill McPeek Capital Improvement Project Manager ATTACHMENT 1 Page 321 of 512 Item 8.j. MEMORANDUM TO: City Council FROM: Bill Robeson, Assistant City Manager/Public Works Director BY: Jill McPeek, Capital Improvement Project Manager SUBJECT: Consideration of Confirming the Environmental Determination, Acceptance of Grant of Temporary Construction License, Public Pedestrian Access Easement Deeds, and Approval of Construction Plans and Specifications for the 2022 Pedestrian Crossing Improvement DATE: July 26, 2022 SUMMARY OF ACTION: Confirming the environmental determination and acceptance of the right of way documents will allow the City to obtain allocated grant funding for the construction phase of the project and to advertise for construction bids for the 2022 Pedestrian Crossing Improvements Project. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: An allocation of $205,000 of Highway Safety Improvement Program (HSIP) funds is included for the project in the FY 2022-23 Capital Improvement Program budget. It is estimated that approximately $80,774 ($45,000 HSIP funds and $35,774 Regional State Highway Account (RSHA) funds) will be carried over from FY 2021-22 for a total available budget of approximately $285,774 available for the bidding and construction phases of the project. Staff time will be necessary to provide direction and answer questions to prospective bidders. RECOMMENDATION: 1) Find that the project is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to Guidelines Section 15301(c) and direct staff to file a Notice of Exemption; 2) Accept the Grant of Temporary Construction License and Public Pedestrian Access Easement Deeds and direct staff to file the License and Deeds; and 3) Approve the construction plans and specifications for the 2022 Pedestrian Crossing Improvements Project, PW 2021-08, and authorize staff to advertise for construction bids pending approval of a funding allocation from the State. ATTACHMENT 2 Page 322 of 512 Item 8.j. City Council Consideration of Confirming the Environmental Determination, Acceptance of Grant of Temporary Construction License, Public Pedestrian Access Easement Deeds, and Approval of Construction Plans and Specifications for the 2022 Pedestrian Crossing Improvement July 26, 2022 Page 2 BACKGROUND: In 2018, the City was successful in securing $150,000 of RSHA funds through the San Luis Obispo Council of Government’s (SLOCOG’s) Safe Routes to School (SRTS) program for pedestrian improvements in the vicinity of Harloe Elementary School. As part of the 2018 Concrete Repairs project, $50,000 of these funds were used to install sidewalks along Farroll Avenue between Gaynfair Terrace and Alder Street. The remaining $100,000 was earmarked for sidewalk gap closures on South Halcyon Road and pedestrian crossing improvements at Sandalwood Avenue. During refinement of the preliminary design, it was estimated that $100,000 would not be enough to fully construct the improvements as proposed in the grant application and staff pursued further grant funding opportunities. In 2020, the City was successful in securing $250,000 of State HSIP funds to install pedestrian crossing improvements at three intersections:  South Halcyon Road at Sandalwood Avenue  Farroll Avenue at South Halcyon Road  East Grand Avenue at Alder Street With both grant funding sources in place, staff began working with its design consultant in preparing construction documents for public bid. During design it was revealed that in order to make grades to meet current American with Disabilities (ADA) standards for the curb ramps at East Grand Avenue at Alder Street, additional right of way would be required. Staff has coordinated with the two property owners, who have executed Public Pedestrian Access Easement Deeds for the additional property needed for the project, as well as a Grant of Temporary Construction License to allow for some additional area needed to accommodate construction activities. In order to bid the project and provide immunity to the City, the City Council is requested to approve the plans and specifications prior to the construction bidding process. In addition, the scope of work is proposed to be evaluated pursuant to CEQA prior to bidding. Before the City can bid the project, the City must request an allocation of State funds from the HSIP program for the construction phase of the project. Both the environmental determination and right of way documents need to be complete d before the City can request the allocation. Council’s action of confirming the environmental determination and acceptance of the right of way documents will allow staff to submit the allocation request. Once the State approves the allocation, staff can advertise for construction bids. Page 323 of 512 Item 8.j. City Council Consideration of Confirming the Environmental Determination, Acceptance of Grant of Temporary Construction License, Public Pedestrian Access Easement Deeds, and Approval of Construction Plans and Specifications for the 2022 Pedestrian Crossing Improvement July 26, 2022 Page 3 ANALYSIS OF ISSUES: The general scope of work includes: South Halcyon Road Pedestrian Crossing at Sandalwood Avenue  Installation of bulbouts and replacement of the existing rectangular rapid flashing beacons (RRFBs) on each side of South Halcyon Road  Installation of yield to pedestrian signs and yield lines on South Halcyon Road  Installation of ADA curb ramps and yellow continental school crosswalks on South Halcyon Road and on Sandalwood Avenue Farroll Avenue Pedestrian Crossing at South Halcyon Road  Installation of ADA curb ramps and yellow continental school crosswalk on Farroll Avenue South Halcyon Road Sidewalk Gap Closure  Installation of sidewalk, curb and gutter and ADA curb ramps on the east side of South Halcyon Road between Cameron Court and Virginia Drive East Grand Avenue Pedestrian Crossing at Alder Street  Installation of rectangular rapid flashing beacons (RRFBs) on each side of East Grand Avenue  Installation of yield to pedestrian signs, yield lines, and continental crosswalk on East Grand Avenue  Installation of ADA curb ramps and continental crosswalk on Alder Street The estimated construction cost of the project is $270,100 and the proposed contract time is 60 working days. Pending approval of a funding allocation from the State and if successful bids are received and a construction contract is awarded, work is expected to be performed between October 2022 and January 2023. Plans and specifications are available for review at the Public Works Department. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Approve staff’s recommendations as proposed; 2. Do not approve staff’s recommendations as proposed; 3. Modify staff’s recommendation and approve; or 4. Provide other direction to staff. Page 324 of 512 Item 8.j. City Council Consideration of Confirming the Environmental Determination, Acceptance of Grant of Temporary Construction License, Public Pedestrian Access Easement Deeds, and Approval of Construction Plans and Specifications for the 2022 Pedestrian Crossing Improvement July 26, 2022 Page 4 ADVANTAGES: Installation of improvements at uncontrolled pedestrian crossings will address one of the main safety issues in the City (where fatal and severe injury pedestrian to vehicle collisions occur) as identified in the Local Road Safety Plan (LRSP). Installation of sidewalk where none currently exists will provide safe and continuous access for pedestrians in the vicinity of Harloe Elementary School. Confirming the environmental determination and acceptance of the right of way documents will allow the City to request funding for the construction phase of the project. DISADVANTAGES: There will be intermittent sidewalk closures during the project. These closures will be minimized as much as possible and the project specifications require the contractor to notify affected residents and businesses in advance. In addition, staff will work with Lucia Mar School District and Harloe Elementary School personnel to coordinate disruptions to parents and students accessing the school from Farroll Avenue. ENVIRONMENTAL REVIEW: The project is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to Guideline Section 15301(c) for repairs and maintenance of existing streets, sidewalks, gutters and similar facilities. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachment: 1. Notice of Exemption 2. Public Pedestrian Access Easement Deed (077-221-030) 3. Public Pedestrian Access Easement Deed (077-223-061) 4. Grant of Temporary Construction License (077-223-061) Page 325 of 512 ATTACHMENT 1 Page 326 of 512 ATTACHMENT 2 Page 327 of 512 Page 328 of 512 Page 329 of 512 Page 330 of 512 ATTACHMENT 3 Page 331 of 512 Page 332 of 512 Page 333 of 512 Page 334 of 512 Page 335 of 512 ATTACHMENT 4 Page 336 of 512 Page 337 of 512 Page 338 of 512 Page 339 of 512 Item 8.i. MEMORANDUM TO: City Council FROM: Bill Robeson, Assistant City Manager/Public Works Director BY: Shane Taylor, Utilities Manager SUBJECT: Monthly Water Supply and Demand Update DATE: September 27, 2022 SUMMARY OF ACTION: The update reports the City’s total water supply and demand for August, 2022. Current Lopez Reservoir level and projected levels are provided in the attachments. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: Approximately two (2) hours of staff time is required to prepare the report. RECOMMENDATION: Receive and file the monthly Water Supply and Demand Report. BACKGROUND: On October 12, 2021, the City Council adopted a Resolution declaring a Stage 1 Water Shortage Emergency, and implementing emergency water conservation measures and restrictions as a result of the extreme drought conditions. In August, the City’s water use was 196.4 acre-feet with a per capita use of 115 gallons per day/per person. There was a total of 0 inches of rainfall in the City in August, 2022. ANALYSIS OF ISSUES: The United States Drought Monitor, as of September 8, 2022, shows San Luis Obispo County in a severe drought. Rainfall to date for the period July 1, 202 2, through August 31, 2022, is 0 inches at the Corporation Yard rain gauge. Lopez Lake, as of September 12, 2022, is at 24.2% capacity (11,942). The new water year began on April 1, 2022, and the City’s annual Lopez Lake contract supply had been reduced to 10% on August 24, 2021, by the enactment of the Low Reservoir Response Plan (LRRP). On July 21, 2022, the Zone 3 Advisory Board approved the Technical Advisory Committee’s recommendations to reduce contract Page 340 of 512 Item 8.i. City Council Monthly Water Supply and Demand Update September 27, 2022 Page 2 deliveries by 20% prior to the lake reaching 10,000 acre feet. As a result, the City began reducing the flow of deliveries on July 26, 2022, to 1.7 million gallons per day compared to the normal flow of 2.2. million gallons per day. In addition to Lopez Lake deliveries, the City has 1323 acre-feet of groundwater entitlement from the Santa Maria basin and wells within the Pismo formation that can produce 160 acre-feet per year. The third quarter monitoring for the Santa Maria Basin sentry wells was completed on July 11th. The deep well index was 5.34 feet above sea level, which is 2.16 feet below the deep well index threshold value of 7.5 feet and 1.91 feet lower than the index value one year ago. This is the first quarter that the level has been below the 7.5 threshold value. If the index level stays below the 7.5 level for six consecutive quarters, or if indication of sea water intrusion occurs, this could trigger additional water restrictions for Arroyo Grande. The predicted use for water year 2022/23 is 2,213 acre -feet based on average rainfall. The August 2022 water use was 10% lower that the August 2021 water use. This reduction met the City’s goal of an overall 10% reduction from the same month in 2021. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Receive and file the report; or 2. Provide other direction to staff. ADVANTAGES: This report provides the City Council and the public with the current and projected conditions of the City’s water supply and demand. DISADVANTAGES: No disadvantages noted at this time. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Lopez Monthly Operations Report for August, 2022 2. Lopez Reservoir Storage Projection 3. Monthly Water Use Comparison 4. Monthly Monitoring Report for August, 2022 Page 341 of 512 San Luis Obispo County Flood Control and Water DistrictZone 3 - Lopez Project - Monthly Operations ReportAugust, 20220.00Note: Deliveries are in acre-feet. One acre foot = 325, 850 gallons or 43, 560 cubic feet. Safe yield is 8,730 acre-feet"Year to Date" is January to present for State water, April to present for Lopez deliveries, and July to present for rainfall.824.80April to Present0.00Arroyo Grande1832Lopez Dam OperationsLake Elevation (full at 522.37 feet)461.01Storage (full at 49200 acre feet)12100Rainfall0Downstream Release (4200 acre feet/year)185.36Spillage (acre feet)0This MonthYear to Date915.450.00742.00161.70Entl.Surplus Water DeclaredUsage2574Total Available WaterLopez Water Deliveries0.00Oceano CSD242.4375.000.00617330.86Grover Beach640204.0067.0284498.96Pismo Beach713.61048.0025.85176239.83CSA 12196230.008.82426953.911240130.0063.33969.50307.7875044.50State Water Deliveries1294.4536242599.00263.3962231383.542206189.59Total ContractorDifference (feet)-61.36% Full24.6%Comments:1) Oceano supplied water to Canyon Crest via Arroyo Grande's Edna turn out. A total of 2.37 AF delivered to Canyon Crest was added to Oceano'swater usage this month and 2.37 AF was subtracted from Arroyo Grande's usage this month.2) Lopez Water Deliveries are now operated under the Low Reservoir Response Plan (LRRP). On July 21, 2022 AC endorsed a 20% entitlement reduction (retroactive to April 2022) in anticipation of reaching the 10,000 AF trigger of the LRRP. Entitlements shown represent a 20% reduction. 3)Surplus water shown is actually "Carry Over" water as designated in the LRRP.4) On April 2022, the County presented the Stored State Water minus evaporation losses dating back to the January 1, 2015 water recharacterization.On December 31, 2021 the calculated Stored State Water minus evaporation losses was 659.82 AF. Evaporation losses will be presented annually.April to Present Lopez Entitlement+Surplus Water Usage050100150200Jan '22 Feb '22 Mar '22 Apr '22 May '22 Jun '22 Jul '22 Aug '22Acre FeetAGGBOCSDPBCSA12January to Present State Water Usage050100150Jan '22 Feb '22 Mar '22 Apr '22 May '22 Jun '22 Jul '22 Aug '22Acre FeetOCSDPBCSA12SanMigSan Miguelito58.521205.59This Month%TotalJanuary to PresentUsageThis Month% of Annual RequestUsage% of Annual Request161.7Total Water Deliveries This Month44.567.02155.8518.325.59452.98Annual Request0.00Usage0.000.000.000.00%0.000.000.000.000.00824.800.00330.8698.9639.831294.450.001593.00SWP DeliveriesSWP DeliveriesChange in Storage24959.41869.28This Month Stored State Water0.0%8.8%32.0%0.0%0.0%10.5%39.2%3.6%5.6%4.5%9.3%10.5%76.9%9.9%66.0%5.9%41.0%7.3%20.8%8.6%62.7%4.7%48.8%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%45.0%0.0%51.7%13.9%20.3%35.7%0.0%EntitlementSurplusUsage%Usage%EntitlementSurplusUsage%809.87Last Month Stored State WaterSurplus Requested742.00375.00204.001048.00230.002599.00Monday, September 12, 2022Page 1 of 1Report printed by:AdminData entered by:D. BravoATTACHMENT 1Page 342 of 512 5.440.54 4.70 2.14 0.24 0.52 1.42 5.16 0.22 0.94 2.38 0.30 7.33 0.430.34 2.873.10 2.77 0.900.33 0.060.030.02 0.320.62 1.34 2.03 3.02 3.25 2.91 1.13 0.410.070.030.02 0.320.62 1.70 2.24 3.12 2.982.84 0.98 0.360.070.030.02 0.350.67 1.842.24 2.762.98 3.01 0.98 0.41 12/8/2022 0.00 2.00 4.00 6.00 8.00 10.00 12.00 14.00 0 5000 10000 15000 20000 25000 30000 35000 40000 1/1/20202/1/20203/1/20204/1/20205/1/20206/1/20207/1/20208/1/20209/1/202010/1/202011/1/202012/1/20201/1/20212/1/20213/1/20214/1/20215/1/20216/1/20217/1/20218/1/20219/1/202110/1/202111/1/202112/1/20211/1/20222/1/20223/1/20224/1/20225/1/20226/1/20227/1/20228/1/20229/1/202210/1/202211/1/202212/1/20221/1/20232/1/20233/1/20234/1/20235/1/20236/1/2023Storage (AF)Date LOPEZ RESERVOIR STORAGE PROJECTION Actual Precipitation Predicted Precipitation Actual Storage 20,000 AF Storage Projection Storage Projection (No Rain) 10,000 AF ATTACHMENT 2 Page 343 of 512 NOTE: There was a 10% reduction in August 2022 compared to August 2021217.5196.4130115050100150200250Aug‐21 Aug‐22Monthly Water Use ComparisonAcre FeetUsage (gpcd)ATTACHMENT 3Page 344 of 512 ATTACHMENT 4 Below is the information you have submitted for the month of August 2022. We use your most recently submitted monthly report in our calculations. Reporter Shane Taylor Report Type Full Urban Water Supplier(Number) Arroyo Grande City of (608) Public Water System ID(s) CA4010001 Reporting Month 0822 County/Counties San Luis Obispo County Under Drought Declaration Yes Water Shortage Contingency Plan 1 Water Shortage Level 2 Population 17963 Total Potable Water Production 196.4 AF Commercial Agricultural Water 0 AF Residential Use Percentage 80 % CII Water 21.6 AF Recycled Water 0 AF Non-revenue Water AF Estimated R-GPCD 91.94 Qualification Emergency Response Section Revealed? Yes State Water Resources Control Board Office of Research, Planning & Performance Page 345 of 512 Item 8.j. MEMORANDUM TO: City Council FROM: Bill Robeson, Assistant City Manager/Public Works Director BY: Jill McPeek, Capital Improvement Project Manager SUBJECT: Consideration to Adopt a Resolution Pursuant to Public Contract Code Section 22050 Determining to Continue Work Under Emergency Contracts for the FCFA Station 1 Emergency Generator Replacement Project, PW 2021-09 DATE: September 27, 2022 SUMMARY OF ACTION: Adoption of the Resolution by the required four-fifths vote will allow for the accelerated replacement of the emergency generator at the Five Cities Fire Authority (FCFA) Station 1. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: There are no additional fiscal impacts from adoption of this Resolution. The FY 2021-22 and FY 2022-23 Capital Improvement Program (CIP) budgets included $680,018 ($46,780 General Fund, $318,738 Sales Tax Funds, and $314,500 of California Nuclear Power Preparedness (NPP) Program funding) for the subject project. The engineer’s construction cost estimate for the project is currently $646,453. FCFA staff will seek to secure the NPP funding upon completion of the construction documents and associated engineer’s construction cost estimate. It is anticipated that NPP funding will cover approximately 50% or $323,277. Staff time will be necessary to coordinate construction activities with the contractor and special inspectors. RECOMMENDATION: 1) Receive and file an update of the emergency generator replacement project at the FCFA Station 1; and 2) Adopt a Resolution determining that there is a need to continue the emergency action for the replacement of the emergency generator in accordance with Public Contract Code Section 22050. Page 346 of 512 Item 8.j. City Council Consideration to Adopt a Resolution Pursuant to Public Contract Code Section 22050 Determining to Continue Work Under Emergency Contracts for t he FCFA Station 1 Emergency Generator Replacement Project, PW 2021-09 September 27, 2022 Page 2 BACKGROUND: At its regular meeting on September 13, 2022, the City Council adopted Resolution No. 5219 declaring an emergency and authorizing the accelerated replacement of the emergency generator at the FCFA Station 1 by elimina ting the formal bid process. Public Contract Code (PCC) Section 22050 allows a public agency, in the case of an emergency, to repair or replace a public facility, take any directly related and immediate action required by that emergency, and procure the necessary equipment, services, and supplies for those purposes without going through a formal bid process. PCC Section 22050 requires that after proceeding with an emergency project, the City Council shall review the emergency action at its next regularly scheduled meeting and at every regularly scheduled meeting thereafter until the emergency action is terminated, and if it is determined that there is a need to continue the action, authorize continuation of the emergency action by a four-fifths vote. This item seeks such authorization. ANALYSIS OF ISSUES: As of September 20, 2022, the status of the project is as follows:  The Council adopted a Resolution declaring an emergency and authorized the accelerated replacement of the emergency generator at the FCFA Station 1 without the competitive solicitation of bids.  Comments on the 95% construction documents were forwarded to the design consultant to finalize the construction documents. While a portable generator has been brought on site that allows for the opening of the apparatus bay doors and some lighting at the fire station, it does not provide power to the server room or the station alerting system, which are critical needs. Therefore, there remains an imminent danger to public health and safety as this situation may cause delay of emergency 9-1-1 services during the event of a power outage . Because of this, staff recommends that the emergency action be continued. As required by statute, staff will continue to bring a similar item to the Council on subsequent agendas until the necessary emergency work has been completed or until the emergency action is terminated. Until this future item, staff will continue to work with the design consultant and selected contractor to complete the improvements on an accelerated basis. Page 347 of 512 Item 8.j. City Council Consideration to Adopt a Resolution Pursuant to Public Contract Code Section 22050 Determining to Continue Work Under Emergency Contracts for t he FCFA Station 1 Emergency Generator Replacement Project, PW 2021-09 September 27, 2022 Page 3 ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Receive and file an update of the emergency generator replacement project at the FCFA Station 1; and adopt the proposed Resolution finding that there is a need to continue the emergency action for the replacement of the emergency generator in accordance with Public Contract Code Section 22050; 2. Receive and file an update of the emergency generator replacement project at the FCFA Station 1; do not adopt the proposed Resolution; and direct staff to prepare a Resolution to terminate the need to continue work under emergency action; or 3. Provide other direction to staff. ADVANTAGES: Adoption of the Resolution will allow for the accelerated replacement of the emergency generator at the FCFA Station 1 which will ensure power during the event of a power outage thereby providing rapid response time in the event of an emergency situation. DISADVANTAGES: No disadvantages are identified at this time. ENVIRONMENTAL REVIEW: No environmental review is needed to authorize the continuation of the emergency action. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed Resolution 2. September 13, 2022 Staff Report and Attachment Page 348 of 512 ATTACHMENT 1 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DETERMINING A NEED TO CONTINUE WORK UNDER EMERGENCY CONTRACTS FOR THE FIVE CITIES FIRE AUTHORITY STATION 1 EMERGENCY GENERATOR REPLACEMENT PROJECT WHEREAS, on September 13, 2022, pursuant to Public Contract Code (PCC) Section 22050, the City Council deemed it was is in the public interest to immediately authorize the expenditure of City funds needed to safeguard the health, safety and welfare and to proceed immediately with the replacement of the emergency generator at the Five Cities Fire Authority (FCFA) Station 1; and WHEREAS, On September 13, 2022, the City Council deemed the immediate replacement of the emergency generator was necessary in order to protect the public health, safety and welfare and would not permit a delay resulting from a competitive solicitation for bids and that prompt action, including authorization to expend all funds required for such replacement without competitive bidd ing, was necessary to respond to the emergency; and WHEREAS, on September 13, 2022, the City Council adopted Resolution No. 5219 declaring an emergency and authorizing the City Manager to enter into any contract or agreement in order to immediately replace the emergency generator; and WHEREAS, PCC Section 22050 requires that after proceeding with an emergency project, the City Council shall review the emergency action at its next regularly scheduled meeting and at every regularly scheduled meeting thereafter until the emergency action is terminated; and WHEREAS, if it is determined that there is a need to continue the emergency action, PCC Section 22050 requires a four-fifths vote to authorize the continuation of the emergency action. NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Arroyo Grande that the emergency declared by the City Council on September 13, 2022 regarding replacement of the generator at FCFA Station 1 shall be deemed to continue. BE IT FURTHER RESOLVED, that the local emergency shall be deemed to continue to exist until its termination is proclaimed by the City Council. On motion by Council Member _________, seconded by Council Member _______, and on the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was passed and adopted this 27th day of September, 2022. Page 349 of 512 RESOLUTION NO. PAGE 2 ___________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: ___ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: _________________________________ WHITNEY MCDONALD, CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 350 of 512 ATTACHMENT 2 Attachment 2 - September 13, 2022 Staff Report and Attachment Attachment 2 is available as links: https://pub-arroyogrande.escribemeetings.com/filestream.ashx?DocumentId=3899 https://pub-arroyogrande.escribemeetings.com/filestream.ashx?DocumentId=3900 Page 351 of 512 Item 8.k. MEMORANDUM TO: City Council FROM: Brian Pedrotti, Community Development Director BY: Andrew Perez, Planning Manager SUBJECT: Consideration of Adoption of an Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Accessory Dwelling Units and Adoption of a Resolution Approving an Accessory Dwelling Unit Fee Waiver Program DATE: September 27, 2022 SUMMARY OF ACTION: Adopting the Ordinance will amend regulations for the development of accessory dwelling units (ADU). Adopting the Resolution will establish a Fee Waiver Program for ADUs that are 500 square feet or less. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: SB 2 grant funding in the amount of $20,000 was obtained to offset costs associated with the amendments to the Accessory Dwelling Unit (ADU) regulations, including staffing hours, website development, and marketing materials. The implementation of the fee waiver program is anticipated to decrease revenue for the Community Development Department by as much as $18,000 annually. However, the lost revenue as a result of waiver building permit fees can be recouped through the use of funds fr om the City’s Inclusionary Housing Trust Fund. RECOMMENDATION: Adopt the Ordinance amending development regulations for ADUs and adopt a Resolution establishing the ADU Fee Waiver Program. BACKGROUND: The process to update the Ordinance began with a s tudy session at the August 3, 2021 Planning Commission (PC) meeting. At the following PC meeting, staff presented amendments to the Ordinance developed in accordance with feedback obtained from the study session, and the PC recommended that Council adopt amendments to the Title 16 provisions regulating ADU development. The amendments were introduced to the City Council at its meeting on February 8, 2022 (Attachment 3). At that time, Council directed Page 352 of 512 Item 8.k. City Council Consideration of Adoption of an Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Accessory Dwelling Units and Adoption of a Resolution Approving an Accessory Dwelling Unit Fee Waiver Program September 27, 2022 Page 2 staff to modify the draft Ordinance with regard to several aspects of the Ordinance. Staff modified the Ordinance accordingly and presented the changes to Council at a study session on July 26, 2022 (Attachment 4). Positive feedback from Council at the study session allowed staff to proceed to a recommendation he aring with the PC on August 16, 2022, at which PC recommended Council adopt the Ordinance amendments (Attachment 5). Staff introduced amendments to the ADU Ordinance and parameters of the proposed ADU Fee Waiver Program to Council on September 13, 2022 (Attachment 6). Council spoke in support of the draft Ordinance and Fee Waiver Program and introduced the Ordinance as proposed. ANALYSIS OF ISSUES: The Ordinance is now ready for adoption. The new regulations for the development of ADUs and JADUs will become effective thirty (30) days after adoption. The ADU Fee Waiver Program will become effective immediately upon adoption. The adopted Ordinance will be sent to the Department of Housing and Community Development for review and confirmation that it is in compliance with State law. Staff performed additional research regarding the issue of whether the payment of prevailing wages was required on ADU projects for persons participating in the ADU Fee Waiver Program and confirmed that payment of prevailing wages is not required. This included discussions with the Santa Cruz City Attorney’s Office and additional research through the Department of Industrial Relations. The exemption from the prevailing wage requirement found in Labor Code Section 1720(c)(1) is applicable. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Adopt the Ordinance and ADU Fee Waiver Resolution as proposed; 2. Adopt the Ordinance and modify and adopt the ADU Fee Waiver Resolution; 3. Modify and reintroduce the Ordinance and direct that adoption of the Ordinance occur at a future meeting; 4. Provide other direction to staff. ADVANTAGES: Adoption of the Ordinance will regulate development of ADUs in a manner that is consistent with State law. An update to the Ordinance will also satisfy Housing Element Program A.2-1. The ADU Fee W aiver Program will incentivize development of affordable housing units, which is consistent with Housing Element Programs A.3-1 and A.3-3. DISADVANTAGES: None identified. Page 353 of 512 Item 8.k. City Council Consideration of Adoption of an Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Accessory Dwelling Units and Adoption of a Resolution Approving an Accessory Dwelling Unit Fee Waiver Program September 27, 2022 Page 3 ENVIRONMENTAL REVIEW: In compliance with the California Environmental Quality Act (CEQA), the Community Development Department has determined that the project is statutorily exempt per Section 15282(h) of the Guidelines regarding projects involving the ado ption of an ordinance regarding second units in a single-family or multifamily residential zone by a city to implement provisions of Government Code Section 65852.2. PUBLIC NOTIFICATION AND COMMENTS: A summary of the Ordinance was published in The Tribune on September 16, 2022, pursuant to State law. The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed Ordinance 2. Proposed Resolution - ADU Fee Waiver Program 3. Staff Report and Minutes from the February 8, 2022 City Council Meeting 4. Staff Report and Minutes from the July 26, 2022 City Council Meeting 5. Staff Report and Minutes from the August 16, 2022 Planning Commission Meet ing 6. Staff Report from the September 13, 2022 City Council Meeting 7. Draft Minutes from the September 13, 2022 City Council Meeting Page 354 of 512 ATTACHMENT 1 ORDINANCE NO. AN ORDINANCE OF THE CITY COUNCIL ADOPTING AMENDMENTS TO TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE (AGMC) REGARDING ACCESSORY DWELLING UNITS; LOCATION- CITYWIDE WHEREAS, Section 16.52.150 of the Arroyo Grande Munici pal Code (AGMC) contains the City’s existing regulations for Accessory Dwelling Units (ADUs); and WHEREAS, AGMC Section 16.52.150 of the Arroyo Grande Municipal was last amended in 2017, after the State legislature had amended Government Code §65852.2 and also added Government Code §65852.22 to provide an option for Junior Accessory Dwelling Units (JADUs), however, the 2017 amendment to AGMC 16.52.150 did n ot include an option for JADUs at that time; and WHEREAS, in 2019, the California Legislature approved, and the Governor s igned into law a number of bills ("New ADU Laws") that, among other things, amended Government Code Section 65852.2 and 65852.22 to impose new limits on local authority to regulate ADUs and JADUs; and WHEREAS, the New ADU Laws mandate that cities with accessory dwelling unit ordinances that are inconsistent with the State laws apply the State standards for ADU and JADU approval; and WHEREAS, according to the State Department of Housing and Community Development website the New ADU Laws were adopted to promote the development of ADUs and JADUs, and include allowing ADUs and JADUs to be built concurrently with a single-family dwelling, opening areas where ADUs can be created to include all zoning districts that allow single-family and multifamily uses, modifying fees from utilities such as special districts and water corporations, limited exemptions or reductions in impact fees, and reduced parking requirements; and WHEREAS, the New ADU Laws took effect January 1, 2020, and because the City's ADU ordinance did not comply with the New ADU Laws, the City's ordinance bec ame null and void on that date as a matter of law; and WHEREAS, the City desires to amend its local regulatory scheme for the construction of ADUs and provide for JADUs to comply with the amended provisions of Government Code sections 65852.2 and 65852.22; and WHEREAS, the approval of ADUs and JADUs based solely on the default statutory standards, without local regulations governing height, setback, landscape, architect ural review, among other things, would threaten the character of existing neighborhoods, and negatively impact property values and personal privacy; and Page 355 of 512 ORDINANCE NO. PAGE 2 WHEREAS, on August 16, 2022, the Planning Commission of the Arroyo Grande recommended to the City Council amending Section 16.52.150 of the Arroyo Grande Municipal Code; and WHEREAS, the City Council of the City of Arroyo Grande has, after giving notice thereof as required by law, held a public hearing on September 13, 2022, concerning proposed amendments to AGMC Section 16.52.15 0; and WHEREAS, the City Council of the City of Arroyo Grande, at its regularly scheduled public meeting on September 13 , 2022 introduced this Ordinance to amend Section 16.52.150 of the Arroyo Grande Municipal Code; and WHEREAS, the City Council has carefully considered all pertinent testimony and the staff report, its attachments and all supporting materials referenced therein or offered in the matter as presented at the public hearing. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DOES ORDAIN AS FOLLOWS: SECTION 1. The above recitals and findings are true and correct and are incorporated herein by this reference. SECTION 2. Section 16.52.150 of the Arroyo Grande Municipal Code is hereby amended in its entirety to read as follows: A. Definitions/Prohibited Units. 1. Accessory Dwelling Unit (ADU): An attached or detached residential dwelling unit which provides complete independent living facilities for one or more persons. It shall include permanent provisions for living, sleeping, eating , cooking, and sanitation and shall be located on the same parcel as the primary dwelling or multi-family development. An ADU also includes an efficiency unit and manufactured home as provided in Government Code Section 65852.2(j). An ADU may serve as a rental unit for more than 30 days or be occupied by a person or persons including, but not limited to family members, guests, or caretakers. 2. Junior Accessory Dwelling Unit (JADU): A residential dwelling unit, as defined in Government Code Section 65852.22, that is no more than 500 square feet in size and contained entirely within an existing or proposed single-family structure. A JADU shall include an efficiency kitchen, and may include separate sanitation facilities or share sanitation facilities with the existing dwelling. A JADU may serve as a rental unit for more than 30 days. Owner-occupancy of either primary dwelling or JADU is required by state law. Page 356 of 512 ORDINANCE NO. PAGE 3 3. Mobile homes, as defined in Section 18008 of the Health and Safety Code, recreational vehicles, trailers, or similar units, shall not be allowed as ADUs. 4. Factory-built housing as defined by California Health and Safety Code Section 19971 shall be allowed as ADUs. B. Where Permitted/Establishment. 1. ADUs are permitted in all zoning districts allowing single -family or multifamily use on lots developed with existing or proposed dwellings. 2. An ADU may be established by the following methods: a. Attached to, or located within, an existing or proposed primary dwelling. b. A new detached structure, or located within or attached to an accessory structure, including detached garages or similar structures. c. Conversion of permitted existing attached or detached accessory structures, including garages, storage areas, or similar structures. d. Reconstruction of a permitted existing structure or living area that is proposed to be converted to an ADU, or a portion thereof, in the same location and to the same dimensions and setbacks as the existing structure. 3. A Junior Accessory Dwelling Unit (JADU) may be established within the space of the primary dwelling, including an attached garage or attached accessory structure. 4. A JADU may be established within the space of the primary dwelling in combination with the construction of one detached, new construction ADU not exceeding 850 square-feet and a height of 16 feet with four-foot side and rear setbacks. 5. An existing unit may be converted to an ADU, in conjunction with the construction of a new primary dwelling unit built, if all applicable zoning requirements are met. 6. ADUs shall be permitted on lots developed with existing multi-family dwellings subject to the following provisions: a. The property shall be developed with an existing multi-family structure(s). Page 357 of 512 ORDINANCE NO. PAGE 4 b. A minimum of one ADU may be constructed, or up to 25 percent of the existing unit count, within non-livable space, including, but not limited to, storage rooms, passageways, attics, basements, or closets. c. The construction of two detached ADUs with a maximum size of 850 square feet, or 1,000 square feet with more than one bedroom, sha ll be permitted in addition to ADUs created within non -livable space, subject to a maximum height of 16 feet, and four -foot side and rear setbacks. These ADUs may be attached to each other, but must be detached from the existing multi-family dwelling units. d. Existing livable space of multi-family dwelling units shall not be converted to ADUs. C. Permit Requirements: 1. The City shall ministerially review and act on a building permit application for an ADU or JADU within 60 days after receiving the application. An ADU or JADU proposed with a permit application for a new primary dwelling shall not be approved until the primary dwelling receives approval. Occupancy for an ADU or JADU shall not be issued before occupancy is granted for the primary dwelling. 2. Unless otherwise preempted by state law, the design and construction of all newly constructed ADUs and JADUs shall comply with all applicable building, housing, zoning and site development standards of the Arroyo Grande Development Code, including but not limited to standards regarding setbacks, floor area ratio standards, height, lot coverage, and in the surrounding neighborhood that are listed in the California Register of Historic Places. Applicants shall also comply with all applicable fee and charge requirements, and other applicable zoning requirements. 3. Pursuant to Government Code Section 65852.2(e) (2), the City shall not require the correction of nonconforming zoning conditions as a condition for ministerial approval. D. Development Standards. 1. ADU Type, Location & Size. a. Attached Unit: An ADU attached to an existing primary dwelling shall have a minimum size of 150 square feet and shall not exceed 50 percent of the total existing or proposed living area of the primary dwelling, except as provided by the By-Right Provision below. Page 358 of 512 ORDINANCE NO. PAGE 5 b. Detached Unit: An ADU structurally independent and detached from the existing primary dwelling shall have a minimum size of 150 square feet and shall not exceed 1,200 square feet. c. Conversion of Existing Structure: An ADU constructed within the footprint of an existing dwelling or attached or detached structure shall not be subject to a maximum square-footage of living area. Expansion of an existing structure proposed to be converted to an ADU is limited to 150 square feet for purposes of accommodating ingress and egress. d. By-Right Provision: An attached or detached ADU with a maximum size of 850 square-feet or 1,000 square-foot with more than one bedroom shall be permitted in any circumstance subject to a maximum height of 16 feet, four-foot side and rear setbacks, and compliance with the front setback requirement of the underlying zoning district, and all building codes. No minimum lot size or lot coverage requirement shall apply. e. ADUs shall have independent exterior access from the primary dwelling. f. Maximum Slope. The building site upon which the accessory dwelling unit will be constructed shall not have an average slope in excess of twenty (20) percent. A topographic map and slope analysis, as recommended by the community develop ment director, shall be stamped and signed by either a registered civil engineer, registered architect, or registered landscape architect. Average slope is defined as follows: S = I x L x 100 A x 43,560 Where S = average natural slope, in percent. I = interval, in feet, of the contour lines. L = the sum, in feet, of the length of the contour lines, at selected contour interval "I". A = the total area, in acres, of the site. g. ADUs shall not be required to provide fire sprinklers if they are not required for the primary residence. Page 359 of 512 ORDINANCE NO. PAGE 6 2. JADU Location and Size. a. A JADU shall be constructed entirely within an existing or proposed primary dwelling and shall not exceed 500 square -feet. b. JADUs shall have an independent exterior entrance from the primary dwelling, but may also include shared access between the two units. 3. Required Setbacks. a. An attached or detached ADU not exceeding 850 square feet or 1,000 square feet with more than one bedroom, and a height no greater than 16 feet shall provide a minimum setback of four feet from the side and rear property lines and comply with the front setback for the zoning district. ADUs exceeding the maximum square footage or height specified in this provision shall be subject to compliance with setbacks of the underlying zoning district. b. Cornices and eaves may project into the required yards by no more than one foot. c. ADUs shall comply with the front yard setback and be located on the rear portion of a parcel unless no feasible alternative exists. Feasibility is determined whether a by-right ADU can physically be constructed behind the primary dwelling due to the presence of maximum slope, other structures, existing easements, or drainage features. d. When an ADU is created within an existing structure, the side and rear setbacks must be sufficient for fire safety as determined by the Building Official and Fire Department. e. No setback shall be required for an existing garage or accessory structure converted, or portion thereof, to an ADU and no setback shall be required for a new structure constructed in the same location and same dimensions as an existing structure. f. An ADU constructed above an existing garage or dwelling unit, exceeding 16-feet in height, shall meet the side and rear setbacks of the underlying zoning district. g. Roof top decks shall not be permitted on any detached ADU. Page 360 of 512 ORDINANCE NO. PAGE 7 h. Staircases serving an ADU shall provide a minimum setback of four feet from the side and rear property lines subject to approval by the Building Official and Fire Department. 4. Height and Maximum Lot Coverage. ADUs exceeding 850 square feet or 1,000 square feet with more than one bedroom, and/or a height of 16 feet shall comply with the height, floor -area ratio, and maximum lot coverage of the underlying zoning district. 5. Parking. a. One additional off -street parking space shall be required per unit; with exceptions per subsection g, below. b. No parking space shall be required for an ADU or JADU established within an existing structure. c. Parking spaces shall be a minimum dimension of 9 foot by 18 foo t except as specified below. d. Parking spaces may be located in any configuration on the same lot as the ADU, including, but not limited to, as covered spaces, uncovered spaces, tandem spaces, or by the use of mechanical automobile parking lifts. e. Required off-street parking shall be permitted in front, side, and rear setback areas subject to the following: i. Parking may be located on an existing driveway but shall not block sidewalk access or encroach into the public right-of-way. ii. Parking spaces location wholly or partially within a side yard must have a minimum clear space width of 10-feet. Vehicles shall not block exterior windows or doors of a dwelling or access to utility boxes or meters. iii. Vehicles must be parked on an acceptable surface of concrete, asphalt, gravel, brick, permeable paver or other stable, dust -free surface. iv. No more than 50% of a front yard shall be dedicated to vehicle parking. v. No parking shall be allowed in front yard landscaping areas. Page 361 of 512 ORDINANCE NO. PAGE 8 vi. Access to on-site parking spaces shall be provided via an approved driveway location only. f. When a garage, carport, or covered parking structure that provides the required spaces for the primary dwelling is demolished or converted in conjunction with the construction of an ADU, no replacement parking shall be required. g. Parking Exemption: As required by Government Code Section 65852.2(d), parking space for an ADU shall not be required in any of the following instances: i. The ADU is located within one-half mile walking distance of public transit. ii. The ADU is located within an architecturally and historically significant historic district. iii. The ADU is located within an existing or proposed primary residence or an existing accessory structure. iv. When on-street parking permits are required but not offered to the occupant of the ADU. v. When there is a car share vehicle located within one block of the ADU. 6. Objective Design Standards a. The colors of the exterior walls, roof, eaves, and windows and doors of a new, detached ADUs must match the appearance and architectural design of those of the primary dwelling. b. If a garage is converted to an ADU, the garage door opening shall be replaced with exterior wall coverings, or residential windows and doors, to match the existing exterior garage wall covering and detailing. c. ADUs created under the By-Right Provisions of this Section are exempt from the Objective Design Standards, as are ADUs created through the use of pre-approved plans and factory-built housing that meet the standards of a By-Right unit. d. Where ADUs are to be located within the front yard setback in accordance with Section D.3.c, the Objective Design Standards shall apply. Page 362 of 512 ORDINANCE NO. PAGE 9 e. ADUs located in the D-2.4 Historic Character Overlay District shall comply with the Objective Design Standards. a. Second floor living area shall be setback 5 feet from the ground floor footprint. b. Window sashes and doorframes shall be made of wood or vinyl simulating the appearance of wood. Unfinished aluminum is not allowed. c. New or replacement doors shall be wood or an approved substitute material that simulates the appearance of original materials. d. The use of fluorescent “neon”, “day-glo”, or bright primary colors as the predominant shade on building facades is not permitted. 7. Impact Fees & Utilities. a. An ADU under 750 square feet shall not be charged development impact fees. An ADU equal to or greater than 750 square feet may be charged development impact fees. These development impact fees shall be proportional to the square footage of the main dwelling and calculated using the ADU square footage. b. ADUs and JADUs shall comply with water and sewer requirements as determined by the Public Works Department. c. The City shall not require a new or separate utility connection or impose a related connection fee or capacity charge for ADUs or JADUs that are contained within an existing residence or accessory structure. Pursuant to Government Code Section 65852.2(f)(5) an ADU not built within the existing space of a single family house or accessory structure may be required to obtain a new or separate utility conne ction as determined by the Public Works Department and may be subject to connection fee s and capacity charges based on either its square footage as a proportion to the square footage of the primary unit, or the number of its drainage fixtures unit values, as determined by the Public Works Department. E. Conditions. 1. An ADU/JADU shall not be sold or otherwise conveyed separate from the primary residence. Page 363 of 512 ORDINANCE NO. PAGE 10 2. An ADU/JADU may serve as a rental unit or be occupied by family members, guests, or in-home health care providers, and others at no cost. 3. Neither the ADU/JADU nor the primary dwelling unit shall be rented for a term of less than 31 days. ADUs on multi-family properties shall be subject to this provision, except the restriction shall not apply to existing multi- family units 4. Owner-occupancy shall be required for a property developed with a JADU. The owner may reside in either the primary dwelling or the JADU. The property owner shall record a covenant, approved as to form by the City Attorney, declaring compliance with each and every condition referenced in this section. SECTION 3. This Ordinance is exempt from the California Environmental Quality Act in accordance State CEQA Guidelines, Article 18: Statutory Exemptions, Section 15282(h).This section of CEQA provides a statutory exemption for “the adoption of an ordinance regarding second units [accessory dwelling units] in a single -family or multifamily residential zone by a city or county to implement the provisions of Sections 65852.1 and 65852.2 of Government Code as set forth in Section 21080.17 of the Public Resources Code.” The City Clerk shall file a Notice of Exemption from CEQA review in accordance with CEQA Guidelines. SECTION 4. A summary of this Ordinance shall be published in a newspaper publis hed and circulated in the City of Arroyo Grande at least five (5) days prior to the City Council meeting at which the proposed Ordinance is to be adopted. A certified copy of the full text of the proposed Ordinance shall be posted in the office of the City Clerk. Within fifteen (15) days after adoption of the Ordinance, the summary with the names of those City Council members voting for and against the Ordinance shall be published again, and the City Clerk shall post a certified copy of the full text of such adopted Ordinance. SECTION 5. This Ordinance shall take effect and be in full force and effect thir ty (30) days after its passage. SECTION 6. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional. On motion by Council Member ______, seconded by Council Member _______, and by the following roll call vote to wit: Page 364 of 512 ORDINANCE NO. PAGE 11 AYES: NOES: ABSENT: the foregoing Ordinance was adopted this 27th day of September, 2022. Page 365 of 512 ORDINANCE NO. PAGE 12 ___________________________________ CARON RAY RUSSOM, MAYOR ATTEST: ___________________________________ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: ________________________________ WHITNEY McDONALD, CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 366 of 512 ATTACHMENT 2 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE PROVIDING FOR AN ACCESSORY DWELLING UNIT FEE WAIVER PROGRAM WHEREAS, Section 16.52.150 of the Arroyo Grande Municipal Code (AGMC) contains the City’s regulations for Accessory Dwelling Units and Junior Accessory Dwelling Units (collectively, “ADUs”) consistent with the requirements of Government Code Sections 65852.2 and 65852.22, and ADUs present an opportunity to develop more affordable housing in the City; and WHEREAS, the City Council of the City of Arroyo Grande wishes to further the policies, goals and programs of the Housing Element of the City's General Plan and to help facilitate the development of affordable housing within the City by creating an ADU Fee Waiver Program under which building permit fees and utility connection fees can be waived for ADUs that are 500 square feet o r less and the property owners agree to rent the ADU to either low income or very low income households; and WHEREAS, the City Council finds that providing a variety of housing options to workers of all income levels is socially and economically beneficial to the City and its residents; and WHEREAS, to the extent that building permit fees and utility connection fees present a barrier to the development of affordable ADUs, the ADU Fee W aiver Program will provide an incentive to their construction and making them available to low-income or very low- income households. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Arroyo Grande as follows: SECTION 1. The City Council hereby finds and determines that the foregoing recitals are true and correct and are incorporated herein by this reference. SECTION 2. ADU FEE WAIVER PROGRAM. City Staff is hereby authorized to implement an ADU Fee Waiver Program. Building permit fees and utility connection fees for Accessory Dwelling Units of 500 square feet or less shall be waived when: A. The property owner agrees to rent the ADU to either a low-income household for a period of ten (10) years, or a very low-income household for a period of seven (7) years. Prior to receiving a building permit, the ADU owners shall execute and record an “Accessory Dwelling Unit Affordable Housing Declaration of Covenants and Land Use Restrictions - Fee Waivers” in a form approved by the City Attorney. B. In implementing this ADU Fee W aiver program, the City shall rely on affordable Page 367 of 512 RESOLUTION NO. PAGE 2 rental limits established by San Luis Obispo County and published each month. C. The Accessory Dwelling Unit Affordable Housing Declaration of Covenants and Land Use Restrictions - Fee Waivers, shall provide that the property owner shall annually provide the City with evidence that rents collected comply with affordable limits. D. Money from the City or Arroyo Grande Inclusionary Housing Affordable Housing Trust Fund shall be used to offset and recoup the revenue that otherwise would have been due to the City for building and connection fees as a result of the ADU Fee Waiver Program. Staff shall provide an annual update to the Council on the status of the Program and impacts to the Trust Fund. SECTION 3. If any section, subsection, sentence, clause, phrase or provision of this Resolution or the application thereof to any person or circumstances is held invalid or unconstitutional by any court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity of any other provision or applications, and to this end the provisions of this Resolution are declared to be severable. The City Council hereby declares that it would have passed this Resolution and each section, subsection, sentence, clause, phrase or provision thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases or provisions thereof be declared invalid or unconstitutional. SECTION 4. This Resolution shall be effective immediately upon its adoption. On motion by Council Member _________, seconded by Council Member _______, and on the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was passed and adopted this 27th day of September, 2022. Page 368 of 512 RESOLUTION NO. PAGE 3 __________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: _________________________________ WHITNEY MCDONALD, CITY MANAGER APPROVED AS TO FORM: _________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 369 of 512 ATTACHMENT 3 Attachment 3 – Staff Report and Minutes from the February 8, 2022 City Council Meeting are available as links: ADU Introduction Staff Report Minutes from the February 8, 2022 City Council Meeting Page 370 of 512 ATTACHMENT 4 Attachment 4 – Staff Report and Minutes from the July 26, 2022 City Council Meeting are available as links: ADU Study Session Staff Report Minutes from the July 26, 2022 City Council Meeting Page 371 of 512 ATTACHMENT 5 Attachment 5 – Staff Report and Minutes from the August 16, 2022 Planning Commission Meeting are available as links: ADU Ordinance Update Staff Report Minutes from the August 16, 2022 PC Meeting Page 372 of 512 ATTACHMENT 6 Attachment 6 – Staff Report from the September 13, 2022 City Council Meeting is available as a link: Introduction of ADU Ordinance Staff Report Page 373 of 512 ATTACHMENT 7 1 ACTION MINUTES REGULAR MEETING OF THE CITY COUNCIL/SUCCESSOR AGENCY TO THE DISSOLVED ARROYO GRANDE REDEVELOPMENT AGENCY September 13, 2022, 6:00 p.m. Hybrid City Council Chamber/Virtual Zoom Meeting 215 East Branch Street, Arroyo Grande Council/Board Members Present: Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, Council/Board Member Storton Council/Board Members Absent: Council/Board Member Barneich Staff Present: City Clerk Jessica Matson, City Attorney Timothy Carmel, City Manager Whitney McDonald, Assistant City Manager/Public Works Director Bill Robeson, Administrative Services Director Nicole Valentine, Community Development Director Brian Pedrotti, Chief of Police Michael Martinez, Planning Manager Andrew Perez, Associate Planner Patrick Holub, Contract Building Official Mark Meyers Given the recent increase in COVID-19 cases in San Luis Obispo County, and in compliance with Assembly Bill (AB) 361, which allows for a deviation of teleconference rules required by the Ralph M. Brown Act, this meeting was held by teleconference. _____________________________________________________________________ 1. CALL TO ORDER Mayor/Chair Ray Russom called the Regular City Council/Successor Agency to the Dissolved Arroyo Grande Redevelopment Agency Meeting to order at 6:00 p.m. 2. ROLL CALL City Clerk Matson took roll call. 3. MOMENT OF REFLECTION Page 374 of 512 ATTACHMENT 7 2 4. FLAG SALUTE Felix Esparza, Latino Outreach Council, led the flag salute. 5. AGENDA REVIEW Mayor/Chair Ray Russom noted that Item 9.b. will be heard before 9.a. and 11.a., and Council Communications will be heard before the Public Hearing items. 5.a Closed Session Announcements None. 5.b Ordinances read in title only Moved by Mayor/Chair Ray Russom Seconded by Council/Board Member Storton AYES (4): Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (1): Council/Board Member Barneich Passed (4 to 0) 6. SPECIAL PRESENTATIONS 6.a Update Regarding Countywide COVID-19 Efforts City Manager McDonald provided a brief update on COVID-19 including available booster vaccines and testing sites. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.b City Manager Communications City Manager McDonald provided information regarding the City's summer concert series, the Elm Street Inclusive Playground groundbreaking event; and the first Joint City Council meeting regarding the Central Coast Blue Project. Assistant City Manager/Public Works Director Robeson provided information regarding awards received for the Bridge Street Bridge Rehabilitation Project. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. Receive correspondence/comments as presented by the City Manager and Provide direction, as necessary. 6.c Honorary Proclamation Recognizing September 15-October 15, 2022 as "National Hispanic Heritage Month" Page 375 of 512 ATTACHMENT 7 3 Mayor/Chair Ray Russom read the Honorary Proclamation recognizing September 15 - October 15, 2022 as "National Hispanic Heritage Month." Felix Esparza, Latino Outreach Council, accepted the proclamation. The Latino Outreach Council and Mexican Consulate presented a Certificate of Recognition to the Council for highlighting the contributions made by the Latino and Mexican community in the City of Arroyo Grande and enhancing and connecting the diverse and multi-racial and multi-cultural mosaic of cultures during Hispanic Heritage Month. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.d Introduction of Police Commander Culver Police Chief Martinez introduced Police Commander Culver, and highlighted his educational and professional background. 6.e Update on Active Shooter Drill Police Commander Culver provided information regarding the recent multi-jurisdictional Active Shooter Drill and responded to questions from Council/Board. Mayor/Chair Ray Russom invited public comment. Speaking from the public was Ben Franco and Rachelle Krelle. No further public comments were received. No action was taken on this item. 7. COMMUNITY COMMENTS AND SUGGESTIONS Mayor/Chair Ray Russom invited public comment. Speaking from the public was Jeff Edwards. No further public comments were received. 8. CONSENT AGENDA Mayor/Chair Ray Russom asked the Council/Board if there were any questions or any items to be pulled from the consent agenda for further discussion. Staff responded to Council questions regarding Item 8.j. Mayor/Chair Ray Russom invited public comment. No public comments were received. Moved by Council/Board Member Storton Seconded by Council/Board Member Paulding Approve Consent Agenda Items 8.a. through 8.m., with the recommended courses of action. AYES (4): Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (1): Council/Board Member Barneich Passed (4 to 0) 8.a Consideration of Cash Disbursement Ratification Page 376 of 512 ATTACHMENT 7 4 Ratified the listing of cash disbursements for the period of August 1 through August 15, 2022. 8.b Consideration of Statement of Investment Deposits Received and filed the attached report listing investment deposits of the City of Arroyo Grande as of July 31, 2022, as required by Government Code Section 53646(b). 8.c Consideration of Adoption of Resolution Approving the Last and Final Recognized Obligation Payment Schedule for the Successor Agency to the Arroyo Grande Redevelopment Agency Adopted a Resolution entitled: "A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY TO THE DISSOLVED ARROYO GRANDE REDEVELOPMENT AGENCY APPROVING THE LAST & FINAL RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR FISCAL YEARS 2023-38 AND APPROVING CERTAIN RELATED ACTIVITIES". 8.d Consideration of Approval of Minutes Approved the minutes of the Regular City Council Meeting of August 23, 2022, as submitted. 8.e Consideration of Adoption of a Resolution Declaring a Continued Local Emergency Related to the Coronavirus (COVID-19) Pandemic Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING A CONTINUED LOCAL EMERGENCY RELATED TO THE CORONAVIRUS (COVID-19) PANDEMIC". 8.f Consideration of Cancellation of November 8, 2022 City Council Meeting Cancelled the regularly scheduled Council meeting of November 8, 2022. 8.g Consideration of Authorizing the City Attorney to Amend the Affordable Housing Agreement for 252 S. Courtland Street Authorized the City Attorney to amend the Agreement allowing the property owner to sell the subject property to an eligible, moderate income household. 8.h Consideration of a Resolution Approving a Grant Agreement from the Office of Traffic Safety for Traffic Records Improvement and Approval of the Purchase of the Crossroads Traffic Collision Reporting and Electronic Citation Systems 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AND AUTHORIZING THE CHIEF OF POLICE TO EXECUTE AN AGREEMENT WITH THE CALIFORNIA OFFICE OF TRAFFIC SAFETY TO ACCEPT GRANT FUNDING FOR TRAFFIC RECORDS IMPROVEMENT PROJECT AND TO APPROPRIATE THE FUNDING FOR THE PROGRAM ACTIVITIES"; 2) Approved a Budget Amendment Request for FY 2022-23 in the amount of $109,000 to account for the OTS grant revenue and the expenditures for the new reporting and citation systems, and 3) Approved the sole source purchase of the Crossroads traffic collision reporting and electronic citation software programs. Page 377 of 512 ATTACHMENT 7 5 8.i Consideration of a Resolution Approving a Grant Agreement with the Office of Traffic Safety for Traffic/DUI Enforcement 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AND AUTHORIZING THE CHIEF OF POLICE TO EXECUTE AN AGREEMENT WITH THE CALIFORNIA OFFICE OF TRAFFIC SAFETY TO ACCEPT GRANT FUNDING FOR TRAFFIC SAFETY PROGRAMS AND TO APPROPRIATE THE FUNDING FOR THE PROGRAM ACTIVITIES"; and 2) Approved a Budget Amendment Request for FY 2022-23 in the amount of $58,000 to account for the additional revenue and expenditures related to the grant. 8.j Consider Adoption of a Resolution Pursuant to Public Contract Code (PCC) Section 20168 and Authorizing Contracting Without a Competitive Solicitation for Bids Pursuant to PCC Section 22050 for FCFA Station 1 Emergency Generator Replacement 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING AN EMERGENCY AND AUTHORIZING THE IMMEDIATE EXPENDITURE OF FUNDS TO REPLACE THE EMERGENCY GENERATOR AT THE FIVE CITIES FIRE AUTHORITY STATION 1"; and 2) Authorized the City Manager, or designee, to execute a contract with a qualified contractor for construction of the project. 8.k Consideration of Acceptance of the 2021 Street Repairs Project, PW 2021-01 1) Accepted the project improvements as constructed by Ferravanti Grading & Paving in accordance with the plans and specifications for the 2021 Street Repairs Project, PW 2021-01; 2) Directed staff to file a Notice of Completion; and 3) Authorized release of retention, thirty-five (35) days after the Notice of Completion has been recorded, if no liens have been filed. 8.l Consideration of Resolution Authorizing Refund of Planning Commission Appeal Fees to the Appellants of Vacation Rental Permits Approved for 263-D Spruce Street and 1170 Linda Drive Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AUTHORIZING THE REFUND OF APPEAL FEES FOR THE APPEALS OF THE SHORT-TERM RENTALS AT 263-D SPRUCE STREET AND 1170 LINDA DRIVE". 8.m Consideration of a Grant Agreement with Smart Share Housing Solutions for Public Outreach, Education, and Project Management to Facilitate Development of Accessory Dwelling Units in Arroyo Grande Reviewed the proposal from SSHS and authorize the City Manager to execute an Agreement between the City and SSHS for public outreach, education, and project management and demonstration to facilitate the development of ADUs in the City. 9. PUBLIC HEARINGS Mayor/Chair Ray Russom noted that due to conflicts of interest, Council previously drew straws to see who would hear each item. Page 378 of 512 ATTACHMENT 7 6 9.a Discuss and Consider Introduction of Ordinance Amending Title 16 of Arroyo Grande Municipal Code Regarding Accessory Dwelling Units; Development Code Amendment 20-001 and Consideration of a Fee Waiver Program for Certain Accessory Dwelling Units Mayor Ray Russom called for a brief break at 8:54 p.m. The Council reconvened at 9:04 p.m. This item was heard after Item 9.b. Mayor Ray Russom declared a conflict of interest due to owning an ADU and left the meeting. Mayor Pro Tem George presided over the meeting. Planning Manager Perez presented the staff report and recommended that Council introduce the Ordinance amending the regulations for accessory dwelling units and provide feedback about the details of the proposed fee waiver program. Staff responded to questions. Mayor Pro Tem George opened the public hearing. Speaking from the public was Ben Franco. Upon hearing no further public comments, Mayor Pro Tem George closed the public hearing and directed staff to follow-up with the commenter. Moved by Mayor Pro Tem/Vice Chair George Seconded by Council/Board Member Paulding Introduce an Ordinance entitled: "AN ORDINANCE OF THE CITY COUNCIL ADOPTING AMENDMENTS TO TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE (AGMC) REGARDING ACCESSORY DWELLING UNITS; LOCATION- CITYWIDE". City Attorney Carmel read the full title of the Ordinance into the record. AYES (3): Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor/Chair Ray Russom, and Council/Board Member Barneich Passed (3 to 0) 9.b Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 This item was heard out of order. Mayor Pro Tem George declared a conflict of interest due to owning a short-term rental and left the meeting. Community Development Director Pedrotti introduced the item. Associate Planner Holub presented the item and recommended that the Council introduce an Ordinance amending Title 16 of the AGMC regarding short-term rentals and responded to questions. Mayor Ray Russom opened the public hearing. Speaking from the public were John Hagler, Sharon Valienzi, Ben Franco, Jim Guthrie, Jami Fordyce, Corina Garsa, Francine Errico, Ken Steitz. Upon hearing no further public comments, Mayor Ray Russom closed the public Page 379 of 512 ATTACHMENT 7 7 hearing. Mayor Ray Russom responded to questions from the public. City Attorney Carmel provided clarification regarding references to properties being "grandfathered in." Staff responded to questions from Council. Moved by Mayor/Chair Ray Russom Seconded by Council/Board Member Paulding To modify the Ordinance as follows: a cap of 90 vacation rentals with a 6-month lookback; a short term rental buffer of 500 feet as recommended by the Planning Commission; language for revocation triggers; "unresponsive emergency contact" defined as a contact who does not respond 3 times in a 12-month rolling period and would initiate a revocation hearing; language that 2 citations or arrests in a 12-month rolling period would initiate a revocation hearing; language in outreach letters regarding voluntary relinquishment of permits for existing permit holders; language that TOT must be paid every 6 months; modify language that states the 2- space parking requirement only applies to vacation rentals; the wording "revocation proceeding" be changed to "revocation hearing;" definitions are approved as presented by staff; and to continue the introduction of an Ordinance amending Title 16 of the AGMC regarding short term rentals to a date certain of September 27, 2022. AYES (3): Mayor/Chair Ray Russom, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor Pro Tem/Vice Chair George, and Council/Board Member Barneich Passed (3 to 0) 10. OLD BUSINESS None. 11. NEW BUSINESS 11.a Discussion of Draft Ordinance Addressing Tiny Homes on Wheels This item was heard after item 9.a. Mayor Ray Russom previously declared a conflict of interest due to owning an ADU and left the meeting. Planning Manager Perez presented the report and staff responded to questions from Council. Mayor Pro Tem George invited public comment. Speaking from the public was Joe Pollon. No further public comments were received. Building Official Meyers provided more information regarding tiny home accreditation organizations permitted. Mayor Pro Tem George directed staff to research accreditation options. Moved by Council/Board Member Paulding Seconded by Council/Board Member Storton Approve staff's recommendation with the modification to add language to paragraph B3 to state "in addition to the RVIA any other HCD approved association", and to ban roof top decks. Page 380 of 512 ATTACHMENT 7 8 AYES (3): Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor/Chair Ray Russom, and Council/Board Member Barneich Passed (3 to 0) 12. COUNCIL COMMUNICATIONS This item was heard out of order. Mayor/Chair Ray Russom stated that she will be unable to attend the Mayor's meeting and asked if any other Council Member would be available to attend. Council members Storton, Paulding and George stated they would not be able to attend. 13. CLOSED SESSION None. 14. ADJOURNMENT There being no further business to come before the City Council/Board of Directors, Mayor Pro Tem George adjourned the meeting at 9:47 p.m. _________________________ Caren Ray Russom, Mayor/Chair _________________________ Jessica Matson, City Clerk/Secretary Page 381 of 512 Item 8.l. MEMORANDUM TO: City Council FROM: Brian Pedrotti, Community Development Director BY: Andrew Perez, Planning Manager SUBJECT: Consideration of Temporary Use Permit 22-011 Authorizing the Temporary Closure of Branch Street for Halloween in the Village on Monday, October 31, 2022; Applicant – Krista Bandy DATE: September 27, 2022 SUMMARY OF ACTION: Approval of the Temporary Use Permit will authorize use of Branch Street for Halloween in the Village and will direct staff to implement safety measures, including closure of East and West Branch Streets between Traffic Way and Mason Street, establish no parking zones, and detour automobile traffic on Monday, October 31, 2022. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: Direct equipment and staffing costs to facilitate the safety measures are estimated at $5,000. This includes $2,735 from the Public Works Department estimated as follows:  $1,500 for Public Works staff time and materials;  $850 for water barricade rentals; and  $385 for contractor to fill water barricades. The remaining $2,265 includes Police Department time and material costs as follows: (2) Officers on foot patrol / at Police Booth (2) Officers as a Reaction Team (1) Motor Officer for traffic enforcement Although the City will incur these costs initially, the proposed Resolution includes a condition requiring the applicant to reimburse the City for all costs associated with closing and securing Branch Street for the event. RECOMMENDATION: Adopt a Resolution approving Temporary Use Permit 22-011, authorizing the closure of East and West Branch Streets to accommodate Halloween in the Village. Page 382 of 512 Item 8.l. City Council Consideration of Temporary Use Permit 22-011 Authorizing the Temporary Closure of Branch Street for Halloween in the Village on Monday, October 31, 2022; Applicant – Krista Bandy September 27, 2022 Page 2 BACKGROUND: Halloween in the Village started informally as an event, but grew in popularity until 2007, when the City required the organizer to formally permit the event and implement measures to protect the large crowds, such as closing West Branch to traffic to enable families to safely cross the street. Changes occurring within the event sponsor and the COVID pandemic resulted in no formal Halloween in the Village event occurring in 2020 and 2021. New event organizers have now applied for a permit to resume the annual Halloween in the Village celebration. The event will provide children a safe daytime environment to trick or treat and to highlight the businesses in the Village through the opportunity for merchants to pass out treats. ANALYSIS OF ISSUES: The purpose of the Temporary Use Permit, which authorizes street closures and imposes safety measures and conditions, is to increase pedestrian safety by reducing pedestrian and vehicle interaction related to the crowds of children and parents who congrega te and circulate on both sides of the four-block core of the Village during the event. Prior to implementing the street closure, large numbers of participants filled the sidewalks at many points and crossed at uncontrolled intersections with the help of cr ossing guards. Full street closure and safety measures were successfully implemented over the previous nine (9) events, between 2011 and 2019, with no incidents observed or reported. The closure of West and East Branch Street from Traffic Way to Mason St reet will be implemented through the following measures:  The placement of “No Parking” signs mounted on delineators 48 hours in advance of the event on West and East Branch Streets;  No parking for a small section at the corner of Mason Street and Nelson S treet (to allow turning movement for commercial trucks);  Closure of intersections or major driveways onto East and West Branch Street, including Bridge Street, the Car Corral, and Nevada Street;  Implementation of a detour which routes automobile and truck traffic onto Traffic Way, Nelson Street and Mason Street; and  Delineating a widened turning lane on East Branch Street at Mason Street for commercial trucks Staff Advisory Committee (SAC) The SAC discussed the project at its meeting on August 25, 2022. The primary topic of discussion was the method by which to secure Branch Street from vehicles at Bridge, and Nevada Streets, as well as the driveways throughout the event area. Water barricades will be installed at each of these intersections to prevent motorists from entering the event area. The SAC recommends approval of the application with conditions of approval included in the draft Resolution. Page 383 of 512 Item 8.l. City Council Consideration of Temporary Use Permit 22-011 Authorizing the Temporary Closure of Branch Street for Halloween in the Village on Monday, October 31, 2022; Applicant – Krista Bandy September 27, 2022 Page 3 ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Adopt the Resolution approving Temporary Use Permit 22-011 2. Modify and adopt the Resolution approving Temporary Use Permit 22-011; 3. Do not adopt the Resolution, or 4. Provide other direction to staff. ADVANTAGES: Full street closure provides a safer environment for participating c hildren and allows children to safely cross the street at any location, thus helping the event to operate more efficiently. DISADVANTAGES: “No Parking” restrictions and the closure of sections of Branch Street will have an impact on traffic congestion and parking. Motorists not familiar with the event will have to use detours to get to their destinations, which may increase travel time. ENVIRONMENTAL REVIEW: In accordance with the California Environmental Quality Act (CEQA), it has been determined that this project is categorically exempt per Section 15304(e) of the CEQA Guidelines regarding minor temporary uses of land. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed Resolution 2. Event Map Page 384 of 512 ATTACHMENT 1 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING TEMPORARY USE PERMIT CASE NO. 22-011 AUTHORIZING “HALLOWEEN IN THE VILLAGE” ON MONDAY, OCTOBER 31, 2022 AND DIRECTING STAFF TO IMPLEMENT RELATED SAFETY MEASURES INCLUDING NO PARKING ZONES AND STREET CLOSURES; APPLIED FOR BY KRISTA BANDY WHEREAS, the applicant applied for a Temporary Use Permit for the Halloween in the Village event (Event) which, amongst other things, helped establish conditions to ensure the safety of the event; and WHEREAS, the implementation of safety measures including no parking zones and street closures will help to facilitate a safe Halloween for all individuals participating in the event and traveling through the Village area; and WHEREAS, the Arroyo Grande Municipal Code (AGMC) provides for the issuance of Temporary Use Permits for events such as “Halloween in the Village,” specifically AGMC Section 10.16.050 authorizes the City Council to restrict parking on any street, and California Vehicle Code Section 21101(e) authorizes the closure of streets for parades and local special events. WHEREAS, the City Council finds, after due study, the following circumstances exist: FINDINGS FOR APPROVAL – TEMPORARY USE PERMIT 1. The operation of the requested use at the locations proposed and within the time period specified will not jeopardize, endanger, or otherwise constitute a menace to the public health, safety or general welfare due to the use of traffic safety equipment and dedicated local law enforcement personnel. 2. The City streets to be used are adequate in size and shape to accommodate the trick-or-treat event without material detriment to the use and enjoyment of other properties located adjacent to and in the vicinity of the Event. 3. The proposed site is adequately served by streets or highways having sufficient width and improvements to accommodate the kind and quantity of traffic that the Event will or could reasonably be expected to generate. 4. Adequate temporary parking to accommodate vehicular traffic to be generated by the Event is available throughout the City. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Arroyo Grande does hereby approve Temporary Use Permit 22-011 authorizing the following actions, with the above Page 385 of 512 RESOLUTION NO. PAGE 2 findings and subject to the conditions as set forth in Exhibit "A", attached hereto and incorporated herein by this reference: 1. The establishment of a “No Parking” zone on East and West Branch Streets between Traffic Way and Mason Street between the hours of 2:00PM and 6:00PM; 2. “No Parking” at the corner of Mason Street and Nelson Street (to allow turning movement for commercial trucks) between the hours of 2:00PM and 6:00PM; 3. The closure of West and East Branch Street from Traffic Way to Mason Street between the hours of 2:00PM and 6:00PM; 4. The closure of intersections or major driveways onto East and West Branch Street including Bridge Street, the Car Corral, and Nevada Street between the hours of 2:00PM and 6:00PM; 5. The implementation of a detour which routes automobile and truck traffic onto Traffic Way, Nelson Street and Mason Street and delineating a widened turning lane on East Branch Street at Mason Street for commercial trucks between the hours of 2:00PM and 6:00PM. NOW, THEREFORE, BE IT FURTHER RESOLVED that the City Council of the City of Arroyo Grande does hereby approve Temporary Use Permit 22-011 authorizing the following actions for the Halloween in the Village: On motion of Council Member , seconded by Council Member , and on the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was passed and adopted this 27th day of September, 2022. Page 386 of 512 RESOLUTION NO. PAGE 3 ______________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: ______________________________________ WHITNEY McDONALD, CITY MANAGER APPROVED AS TO FORM: ______________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 387 of 512 RESOLUTION NO. PAGE 4 EXHIBIT "A" CONDITIONS OF APPROVAL FOR TEMPORARY USE PERMIT NO. 22-011 GENERAL CONDITIONS: 1. This Temporary Use Permit authorizes “Halloween in the Village” and directs staff to implement related safety measures including no parking zones and street closures on Monday, October 31, 2022. 2. The applicant shall ascertain and comply with all State, County and City requirements as are applicable to this project. 3. The event shall occur in substantial conformance with the application and plans on file in the Community Development Department. 4. The applicant shall comply with all of the Conditions of Approval for Temporary Use Permit 22-011. 5. The applicant shall agree to indemnify and defend at his/her sole expense any action brought against the City, its agents, officers, or employees because of the issuance of said approval. The applicant shall reimburse the City, its agents, officers, or employees, for any court costs and attorney’s fees which the City, its agents, officers or employees may be required by a court to pay as a result of such action. The City may, at its sole discretion, participate at its own expense in the defense of any such action but such participation shall not relieve applicant of his/her obligations under this condition. 6. The applicant shall notify all affected businesses and residents of street closures and parking restrictions at least 48 hours prior to the event. 7. The applicant shall clean up all debris associated with the event to the satisfaction of the Public Works Director. 8. Traffic detouring shall be coordinated with the Police Department. 9. The Public Works Department shall be responsible for ordering and directing the setup of all traffic control equipment through a private purveyor. 10. The applicant shall provide a $1,000,000 commercial general liability insurance policy naming the City as additional insured, subject to approval by the City Attorney. Proof of the insurance shall be submitted to the Director of Legislative and Information Services ten (10) days before the event. 11. The applicant shall reimburse the City for all costs incurred for closure of Branch Street and security provided by the Police Department. Page 388 of 512 ATTACHMENT 2 Page 389 of 512 Item 8.m. MEMORANDUM TO: City Council FROM: Bill Robeson, Assistant City Manager/Public Works Director Nicole Valentine, Administrative Services Director Tashina Ureno, Human Resources Officer SUBJECT: Consideration of Adoption of a Resolution Amending the Citywide Combined Salary Schedule to Establish a Pay Schedule for a Temporary Part-Time Acting Capital Improvement Project Manager DATE: September 27, 2022 SUMMARY OF ACTION: Adoption of the Resolution amending the Citywide Combined Salary Schedule to establish a pay schedule for the position of a Temporary Part-Time Acting Capital Improvement Project Manager will provide continuity of technical support for critical functions within the Public Works Department during a leave of absence of the permanent Capital Improvement Project Manager. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: Approval of the Amended Citywide Combined Salary Schedule will result in a new temporary part time position to help fulfill some of the duties of the permanent Capital Improvement Project Manager while on a leave of absence. Total costs will depend on the length of service of the Temporary Part-Time Acting Capital Improvement Project Manager; however, the length of service will not exceed 960 hours, for a total cost of approximately $63,028.80. During the permanent Capital Improvement Project Manager leave of absence, it is anticipated that 66.6% of the employee ’s pay will be paid through third-party benefit payments and should result in a neutral cost to the City to use the Temporary Part-Time Acting Capital Improvement Project Manager. RECOMMENDATION: Adopt the Resolution amending the Citywide Combined Salary Schedule to include a new position for a Temporary Part-Time Acting Capital Improvement Project Manager. BACKGROUND: The Public Works Department is responsible for executing the City’s capital improvement projects. The Capital Improvement Project Manager’s role is to plan, direct, coordinate and supervise the planning, development and administration of the City's capital Page 390 of 512 Item 8.m. City Council Consideration of Adoption of a Resolution Amending the Citywide Combined Salary Schedule to Establish a Pay Schedule for a Temporary Part-Time Acting Capital Improvement Project Manager September 27, 2022 Page 2 improvement program including budgeting, design, management, and inspection of construction of the capital projects. The City’s Capital Improvement Project Manager will be taking a leave of absence and the City is in need of temporary assistance to address critical project management needs during this time. ANALYSIS OF ISSUES: After communication with several individuals and consulting firms, the City has not been able to find a qualified full-time Acting Capital Improvement Project Manager; however, with the availability and qualifications of Mr. Steven Kahn, the City is confident that a significant portion of the City’s capital improvement projects wi ll be managed and completed efficiently and effectively. Mr. Kahn is a retired CalPERS annuitant. Employment of a retired CalPERS annuitant is subject to certain criteria and regulations. These rules are intended to protect the public’s interest by enabling CalPERS contracting agencies the ability to re-employ retirees, and protect the retirement system from inappropriate use or abuse. CalPERS recognizes that retirees can play an important role in keeping city business running, particularly in short term or emergency situations, but also provides limitations on their service. The Government Code provides specific guidance on employing a CalPERS retiree without reinstatement from retirement or loss or interruption of retirement benefits. Key terms of hiring a retired annuitant are: 1. Limited duration work: The appointment needs to be clearly of limited duration. 2. 960 hour limit: Retirees can work a maximum of 960 hours each fiscal year, regardless of the number of CalPERS contracting employers they work for. 3. Rate of Pay requirement: The compensation paid to any retiree must be within the monthly rate of pay range (not more or less than the CIP Manager pay range) and no other benefit, incentive, compensation in lieu of benefits, or other form of compensation can be paid in addition to this hourly pay rate. 4. Enrollment in the my|CalPERS system: The City must report the pay rate and hours worked to CalPERS through the system currently used to report payroll. With the creation of this position, the City will employ Mr. Kahn, who has recently consulted with CalPERS on multiple occasions on the retired annuitant issue and will ensure that CalPERS regulations related to retirees are followed. Mr. Kahn retired from the City of Santa Maria as the Public Works Director in 2018. He is a registered Civil Engineer and licensed Land Surveyor and has over 36 years of Page 391 of 512 Item 8.m. City Council Consideration of Adoption of a Resolution Amending the Citywide Combined Salary Schedule to Establish a Pay Schedule for a Temporary Part-Time Acting Capital Improvement Project Manager September 27, 2022 Page 3 experience in the public works field in both the public and private sector. He is currently employed at a local engineering firm working with cities, counties, and community services districts on the management, operations, and capital projects of the organizations. He has extensive experience with all aspects of public works operations and is exceptionally well qualified to fill the Temporary Part-Time Acting Capital Improvement Project Manager position for the City of Arroyo Grande. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Adopt the Proposed Resolution; 2. Modify and Adopt the Proposed Resolution; 3. Do not adopt the Proposed Resolution; or 4. Provide other direction to staff. ADVANTAGES: Hiring a Temporary Part-Time Acting Capital Improvement Project Manager will provide the leadership for the Public Works Department to continue managing the City’s capital improvement program during the Permanent Capital Improvement Project Manager’s leave of absence. Mr. Kahn’s familiarity with the administration and operation of all aspects of public works will enable him to step into this role quickly and continue moving the City’s capital improvement projects forward during this time. DISADVANTAGES: There are no disadvantages since the cost is already incorporated in the approved Public Works Department budget. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed Resolution Page 392 of 512 ATTACHMENT 1 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING THE CITYWIDE COMBINED SALARY SCHEDULE AND ESTABLISHING A PAY SCHEDULE FOR THE POSITION OF TEMPORARY PART-TIME ACTING CAPITAL IMPROVEMENT PROJECT MANAGER WHEREAS, the City Council desires to amend the Citywide Combined Salary Schedule and establish a pay schedule for the position of Temporary Part-Time Acting Capital Improvement Project Manager; and WHEREAS, publicly available pay schedules are required to comply with California Code of Regulations (CCR) Section 570.5. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Arroyo Grande as follows: 1. The revised Citywide Combined Salary Schedule, attached hereto as Exhibit A and incorporated herein by reference, is hereby approved. 2. This Resolution and the salaries contained in Exhibit A shall constitute a publicly available pay schedule as required by Government Code Section 20480. Pursuant to CCR 570.5, it shall be immediately accessible and available for public review during the City’s normal business hours. 3. This salary schedule shall be effective immediately on the date of the adoption of this Resolution. This Resolution and the salary schedule contained herein shall be retained by the City in its official records on a permanent basis. On motion by Council Member _________, seconded by Council Member _______, and on the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was passed and adopted this 27th day of September, 2022. Page 393 of 512 ATTACHMENT 1 RESOLUTION NO. PAGE 3 ___________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: ___ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: _________________________________ WHITNEY MCDONALD, CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 394 of 512 GROUP: SEIU Position ABC D E Office Assistant I Biweekly 1,528.48 1,604.90 1,685.15 1,769.41 1,857.88 Monthly 3,311.70 3,477.29 3,651.15 3,833.71 4,025.40 Annual 39,740.45 41,727.47 43,813.85 46,004.54 48,304.77 Accounting Clerk I Biweekly 1,566.69        1,645.03      1,727.28        1,813.64        1,904.32         Monthly 3,394.50        3,564.22      3,742.43        3,929.55        4,126.03         Annual 40,733.96      42,770.66    44,909.19      47,154.65      49,512.39       Maintenance Worker I Biweekly 1,646.00        1,728.30      1,814.72        1,905.46        2,000.73         Monthly 3,566.34        3,744.66      3,931.89        4,128.49        4,334.91         Annual 42,796.12      44,935.93    47,182.72      49,541.86      52,018.95       Office Assistant II Biweekly 1,687.15        1,771.51      1,860.09        1,953.09        2,050.75         Monthly 3,655.50        3,838.28      4,030.19        4,231.70        4,443.29         Annual 43,866.02      46,059.32    48,362.29      50,780.41      53,319.43       Accounting Clerk II Biweekly 1,816.88        1,907.73      2,003.11        2,103.27        2,208.43         Maintenance Worker II Monthly 3,936.58        4,133.40      4,340.07        4,557.08        4,784.93         Annual 47,238.91      49,600.86    52,080.90      54,684.94      57,419.19       Administrative Secretary Biweekly 2,005.50        2,105.77      2,211.06        2,321.61        2,437.69         Monthly 4,345.24        4,562.51      4,790.63        5,030.16        5,281.67         Annual 52,142.92      54,750.06    57,487.57      60,361.94      63,380.04       Senior Accounting Clerk Biweekly 2,055.63        2,158.42      2,266.34        2,379.65        2,498.64         Building Permit Tech.Monthly 4,453.87        4,676.57      4,910.40        5,155.92        5,413.71         Plan/Engineer Permit Tech Annual 53,446.49      56,118.81    58,924.76      61,870.99      64,964.54       Sports Facility Coord. Recreation Coordinator Maintenance Worker III Water Services Worker Biweekly 2,159.70        2,267.69      2,381.07        2,500.12        2,625.13         Monthly 4,679.35        4,913.32      5,158.99        5,416.93        5,687.78         Annual 56,152.22      58,959.83    61,907.82      65,003.21      68,253.37       Fleet Maint. Coordinator Biweekly 2,269.04        2,382.49      2,501.61        2,626.69        2,758.03         Community Services Specialist Monthly 4,916.24        5,162.06      5,420.16        5,691.17        5,975.72         Annual 58,994.92      61,944.67    65,041.90      68,294.00      71,708.70       Public Works Lead Worker Biweekly 2,325.76        2,442.05      2,564.15        2,692.36        2,826.98         Parks Lead Worker Monthly 5,039.15        5,291.11      5,555.66        5,833.45        6,125.12         Annual 60,469.80      63,493.29    66,667.95      70,001.35      73,501.42       CITY OF ARROYO GRANDE COMBINED SALARY SCHEDULE EFFECTIVE 09/27/2022 Exhibit A Page 395 of 512 CITY OF ARROYO GRANDE COMBINED SALARY SCHEDULE EFFECTIVE 09/27/2022 Position ABC D E GIS Technician Biweekly 2,504.59        2,629.82      2,761.31        2,899.38        3,044.35         Monthly 5,426.61        5,697.94      5,982.84        6,281.98        6,596.08         Annual 65,119.36      68,375.33    71,794.09      75,383.80      79,152.99       Recreation Supervisor Biweekly 2,567.21        2,695.57      2,830.34        2,971.86        3,120.45         Streets Maintenance Supervisor Monthly 5,562.28        5,840.39      6,132.41        6,439.03        6,760.98         Parks, Tree & Landscape Supervisor Annual 66,747.34      70,084.71    73,588.95      77,268.39      81,131.81       Utilities/Water & Sewer System Supervisor Soto Sports Complex Maint. & Coord. Supervisor Citywide Fleet Coordinator Biweekly 2,631.39        2,762.95      2,901.10        3,046.16        3,198.47         Monthly 5,701.34        5,986.40      6,285.72        6,600.01        6,930.01         Annual 68,416.03      71,836.83    75,428.67      79,200.10      83,160.11       IT Specialist Biweekly 2,764.60        2,902.83      3,047.97        3,200.37        3,360.39         Assistant Engineer Monthly 5,989.97        6,289.46      6,603.94        6,934.13        7,280.84         Engineering Inspector Annual 71,879.59      75,473.57    79,247.25      83,209.61      87,370.09       Program Analyst Associate Engineer Biweekly 3,127.89        3,284.29      3,448.50        3,620.92        3,801.97         Monthly 6,777.10        7,115.95      7,471.75        7,845.34        8,237.60         Annual 81,325.16      85,391.41    89,660.98      94,144.03      98,851.23       Senior Engineer Biweekly 3,368.40        3,536.82      3,713.66        3,899.34        4,094.31         Monthly 7,298.19        7,663.10      8,046.26        8,448.57        8,871.00         Annual 87,578.30      91,957.21    96,555.07      101,382.83    106,451.97     Page 396 of 512 CITY OF ARROYO GRANDE COMBINED SALARY SCHEDULE EFFECTIVE 09/27/2022 GROUP: POA Position ABC D E Police Officer Biweekly 2,823.27        2,964.43      3,112.65        3,268.29        3,431.70         Monthly 6,117.08        6,422.93      6,744.08        7,081.29        7,435.35         Annual 73,404.97      77,075.22    80,928.98      84,975.43      89,224.20       Sr. Police Officer Biweekly 3,117.61        3,273.49      3,437.16        3,609.02        3,789.47         Monthly 6,754.82        7,092.56      7,447.19        7,819.55        8,210.53         Annual 81,057.86      85,110.75    89,366.29      93,834.60      98,526.33       Police Sergeant Biweekly 3,613.43        3,794.10      3,983.80        4,182.99        4,392.14         Monthly 7,829.09        8,220.54      8,631.57        9,063.15        9,516.31         Annual 93,949.08      98,646.54    103,578.86   108,757.81    114,195.70     Records Clerk Biweekly 1,967.53        2,065.90      2,169.20        2,277.66        2,391.54         Monthly 4,262.97        4,476.12      4,699.93        4,934.92        5,181.67         Annual 51,155.66      53,713.45    56,399.12      59,219.08      62,180.03       Records/Property Evidence Tech.Biweekly 2,173.72        2,282.41      2,396.53        2,516.36        2,642.17         Monthly 4,709.73        4,945.22      5,192.48        5,452.10        5,724.71         Annual 56,516.78      59,342.62    62,309.75      65,425.24      68,696.50       Police Trainee Biweekly 2,459.14        2,582.10      2,711.21        2,846.77        2,989.11         Monthly 5,328.15        5,594.55      5,874.28        6,168.00        6,476.40         Annual 63,937.76      67,134.65    70,491.38      74,015.95      77,716.75       Page 397 of 512 CITY OF ARROYO GRANDE COMBINED SALARY SCHEDULE EFFECTIVE 09/27/2022 GROUP: FCFA IAFF Position ABC D E Fire Fighter Biweekly 2,252 2,365 2,483 2,607 2,738 Monthly 4,880 5,124 5,380 5,649 5,932 Annual 58,560 61,488 64,562 67,791 71,180 Fire Engineer Biweekly 2,612 2,742 2,880 3,024 3,175 Monthly 5,659 5,942 6,239 6,551 6,879 Annual 67,908 71,303 74,869 78,612 82,543 Fire Captain Biweekly 3,105 3,260 3,423 3,594 3,774 Monthly 6,727 7,063 7,417 7,787 8,177 Annual 80,724 84,760 88,998 93,448 98,121 GROUP: FCFA MANAGEMENT Position LOW MID HIGH Administrative Operations Manager/Biweekly 3,162 3,504 3,845 Clerk to the Board Monthly 6,851 7,591 8,331 Annual 82,212 91,092 99,972 Battalion Chief Biweekly 4,679 5,184 5,688 Monthly 10,138 11,232 12,325 Annual 121,659 134,780 147,900 Fire Chief Biweekly 5,428 6,014 6,600 Monthly 11,761 13,031 14,301 Annual 141,126 156,366 171,606 Page 398 of 512 CITY OF ARROYO GRANDE COMBINED SALARY SCHEDULE EFFECTIVE 09/27/2022 GROUP: MANAGEMENT Position LOW MID HIGH Office Assistant I Biweekly 1,560.00        1,728.46        1,896.92         Monthly 3,380.00        3,745.00        4,110.00         Annual 40,560.00      44,940.00      49,320.00       Office Assistant II Biweekly 1,721.54        1,908.00        2,094.46         Monthly 3,730.00        4,134.00        4,538.00         Annual 44,760.00      49,608.00      54,456.00       Administrative Secretary Biweekly 1,997.08        2,212.38        2,427.69         Monthly 4,327.00        4,793.50        5,260.00         Annual 51,924.00      57,522.00      63,120.00       Executive Secretary Biweekly 2,259.69        2,503.85        2,748.00         Monthly 4,896.00        5,425.00        5,954.00         Annual 58,752.00      65,100.00      71,448.00       Assistant Planner Biweekly 2,494.62        2,763.92        3,033.23         Monthly 5,405.00        5,988.50        6,572.00         Annual 64,860.00      71,862.00      78,864.00       Associate Planner Biweekly 2,753.08        3,050.54        3,348.00         Deputy City Clerk/ Monthly 5,965.00        6,609.50        7,254.00         Communications Coordinator Annual 71,580.00      79,314.00      87,048.00       Planning Manager Biweekly 3,272.77        3,626.31        3,979.85         Accounting Manager Monthly 7,091.00        7,857.00        8,623.00         Management Analyst Annual 85,092.00      94,284.00      103,476.00     Public Works Manager Biweekly 3,525.23        3,905.31        4,285.38         Utilities Manager Monthly 7,638.00        8,461.50        9,285.00         Annual 91,656.00      101,538.00   111,420.00     Information Technology Mgr Biweekly 3,612.00        4,001.77        4,391.54         Monthly 7,826.00        8,670.50        9,515.00         Annual 93,912.00      104,046.00   114,180.00     Page 399 of 512 CITY OF ARROYO GRANDE COMBINED SALARY SCHEDULE EFFECTIVE 09/27/2022 Position LOW MID HIGH Capital Improvement Projects Biweekly 3,702.46        4,102.15        4,501.85         Manager Monthly 8,022.00        8,888.00        9,754.00         Annual 96,264.00      106,656.00   117,048.00     Human Resources Officer Biweekly 3,795.69        4,205.08        4,614.46         Dir of Legis and Info Services Monthly 8,224.00        9,111.00        9,998.00         Dir of Recreation Services Annual 98,688.00      109,332.00   119,976.00     Building Official Biweekly 3,889.85        4,310.31        4,730.77         Monthly 8,428.00        9,339.00        10,250.00       Annual 101,136.00   112,068.00   123,000.00     Police Commander Biweekly 4,423.85        4,901.31        5,378.77         Monthly 9,585.00        10,619.50      11,654.00       Annual 115,020.00   127,434.00   139,848.00     City Engineer Biweekly 4,738.62        5,251.15        5,763.69         Monthly 10,267.00      11,377.50      12,488.00       Annual 123,204.00   136,530.00   149,856.00     Director of Public Works Biweekly 5,230.62        5,795.54        6,360.46         Dir of Administrative Services Monthly 11,333.00      12,557.00      13,781.00       Dir of Community Develop Annual 135,996.00   150,684.00   165,372.00     Police Chief Biweekly 5,661.23        6,272.54        6,883.85         Monthly 12,266.00      13,590.50      14,915.00       Annual 147,192.00   163,086.00   178,980.00     Assistant City Manager/Public Biweekly 6,303.69        6,983.77        7,663.85         Works Director Monthly 13,658.00      15,131.50      16,605.00       Annual 163,896.00   181,578.00   199,260.00     City Manager Biweekly 7,825.85         Monthly 16,956.00       Annual 203,472.00     Page 400 of 512 CITY OF ARROYO GRANDE COMBINED SALARY SCHEDULE EFFECTIVE 09/27/2022 GROUP: PART‐TIME POSITIONS POLICE DEPARTMENT Step A Step B Step C Step D Administrative Intern (Cadet)$16.30 $17.12 $17.97 $18.87 Records Clerk $20.91 $21.95 $23.05 $24.20 Fleet & Equipment Technician $25.26 $26.53 $27.85 $29.25 Neighborhood Services Technician $22.54 $23.67 $24.85 $26.10 Training Technician $25.26 $26.53 $27.85 $29.25 Police Reserve Officer Trainee $24.11 $25.31 $26.58 $27.90 Police Reserve Officer $27.68 $29.06 $30.51 $32.04 Designated Level I Reserve Officer $34.60 $36.33 $38.15 $40.05 RECREATION SERVICES DEPARTMENT AM/PM Assistant I $15.53 $16.30 $17.12 $17.97 AM/PM Assistant II $16.50 $17.32 $18.19 $19.10 AM/PM Assistant Teacher $18.14 $19.05 $20.00 $21.00 AM/PM Teacher $19.95 $20.95 $22.00 $23.10 Pre School Teacher $19.95 $20.95 $22.00 $23.10 Facility Attendant $15.53 $16.30 $17.12 $17.97 Senior Facility Attendant $16.50 $17.32 $18.19 $19.10 Sports Facility Attendant $15.53 $16.30 $17.12 $17.97 Volunteer and Program Coordinator $25.48 $26.76 $28.09 $29.50 MISCELLANEOUS Capital Improvement Projects Manager $46.28 $49.40 $52.74 $56.27 Administrative Intern $16.30 $17.12 $17.97 $18.87 Office Assistant I $16.99 $17.84 $18.74 $19.67 Office Assistant II $19.86 $20.85 $21.90 $22.99 Sr. Office Assistant $20.91 $21.95 $23.05 $24.20 Administrative Secretary $23.89 $25.08 $26.34 $27.65 Executive Secretary $28.25 $29.66 $31.14 $32.70 Building Permit Technician $25.64 $26.92 $28.26 $29.68 Assistant Engineer $31.29 $32.85 $34.50 $36.22 Associate Engineer $34.41 $36.13 $37.94 $39.84 Planning Technician $25.64 $26.92 $28.26 $29.68 Assistant Planner $29.83 $31.32 $32.89 $34.53 Associate Planner $32.27 $33.88 $35.58 $37.36 Custodian $17.34 $18.20 $19.11 $20.07 Maintenance Worker $17.34 $18.20 $19.11 $20.07 Student Intern (seasonal)$15.53 FIVE CITIES FIRE AUTHORITY Office Assistant II $18.17 $18.71 $20.02 $21.03 Reserve Firefighter $15.00 $16.00 $17.00 HOURLY RATE Page 401 of 512 Item 9.a. MEMORANDUM TO: City Council FROM: Brian Pedrotti, Community Development Director BY: Patrick Holub, Associate Planner SUBJECT: Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 DATE: September 27, 2022 SUMMARY OF ACTION: Introduction of the proposed Ordinance regulating Short Term Rentals. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: In accordance with Chapter 3.24 of the Arroyo Grande Municipal Code (AGMC), Short Term Rentals are required to pay the City’s transient occupancy tax (TOT) in the amount of 13.5% of the rent charged by the operator, 10% of which is retained by the City, 2% is provided to the Arroyo Grande Tourism Business Improvement District (AGTBID), and 1.5% is provided to the San Luis Obispo County Tourism Marketing District (SLO TMD) (Visit SLO Cal). The City received an estimated $150,000 in FY 2021 -22 in TOT from Short Term Rentals. RECOMMENDATION: Introduce an Ordinance amending Title 16 of the AGMC regarding Short Term Rentals. BACKGROUND: On June 10, 2014, the City Council adopted Ordinance No. 663, establishing vacation rentals and homestays (Short Term Rentals or STRs) as permitted land uses in the City’s residential zoning districts, subject to the approval of a Minor Use Permit -Plot Plan Review (Attachment 2). A vacation rental is defined as a structure being rented for less than thirty (30) days without concurrently being occupied by the owner/operator, while a homestay is defined as an owner-occupied dwelling unit where a maximum of two short- term lodging rooms are provided for compensation. These two uses are collectively known as Short Term Rentals or STRs. Page 402 of 512 Item 9.a. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 September 27, 2022 Page 2 On October 12, 2021, the City Council directed staff to bring back a discussion item at a future meeting to evaluate Ordinance 663 after receiving public comment expressing concerns regarding the recent proliferation of STRs, the application and app eal process associated with STRs, and other related issues such as the same street buffer. On March 22, 2022, the City Council conducted a study session regarding the existing short-term rental ordinance. The Council made a number of recommendations, incl uding:  Establishing a cap on the overall number of vacation rental approvals that can be granted;  Contracting with an enforcement company to identify unpermitted rentals;  Altering the methodology for how the buffer distance between rentals is calculated;  Establishing objective revocation triggers;  Requiring that all mailing labels for vacation rentals be provided by the City and paid for by the applicant;  Improving performance standards to ensure greater compatibility with the neighborhood;  Consider an expiration clause; and  Considering whether to impose a parking requirement. A Resolution containing a draft Ordinance was developed from these discussion points for the Planning Commission’s consideration. On August 2, 2022, the Planning Commission conducted a noticed public hearing to consider the proposed revisions to AGMC Sections 16.52.230 and 16.52.240 and adopted a Resolution recommending the City Council adopt an ordinance amending the regulations regarding Short Term Rentals. Their recommendations included the following amendments: 1. Establish a cap on vacation rentals of 120. 2. Increase the buffer between Short Term Rentals of all kinds to 500 feet and provide a buffer from all schools of 500 feet. 3. Initiate revocation procedures if a designated emergency contact is unresponsive three consecutive times or if a citation is issued to a short-term rental tenant by the Police Department. 4. Require that Short Term Rental permits expire at the point of sale of the property. 5. Require that any unit previously occupied by a long-term renter within the past year be ineligible to become a short-term rental. 6. Incorporate the same proposed performance standards for homestays as vacation rentals. 7. Provide two parking spaces off -street for all short-term rentals. The parking spaces can be covered or uncovered. Page 403 of 512 Item 9.a. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 September 27, 2022 Page 3 On September 13, 2022, the City Council considered introduction of a draft Ordinance to incorporate changes to the short-term rental regulations consistent with feedback received from the Planning Commission and City Council. During that meeting, the City Council provided feedback on each recommended amendment to the Ordinance and directed staff to make additional changes to the proposed Ordinance. The hearing to introduce the proposed Ordinance was continued to September 27, 2022. ANALYSIS OF ISSUES At its September 13, 2022 hearing, the City Council provided the following direction to staff regarding the proposed STR Ordinance: 1. Cap the total number of vacation rental approvals at ninety (90); 2. Concur with Planning Commission’s recommendations to increase the buffer distance to five-hundred feet (500’) between STRs of all types and to create a buffer distance of five-hundred feet (500’) from any school; 3. Clarify that an emergency contact shall be deemed unresponsive if no answer is received to a complaint call and that if the emergency contact is unresponsive three times in a rolling twelve (12) month period , in which case revocation proceedings shall be initiated. Furthermore, if two arrests are made or citations issued to STR guests within a rolling twelve (12) month period, revocation proceedings shall be initiated; 4. Clarify the language in the draft Ordinance to indicate that violations of the performance standards will allow staff to initiate revocation proceedings; 5. Clarify that revocation proceedings will include a public hearing; 6. Include information in the City’s host compliance consultant’s forthcoming outreach letters informing STR permit holders of their option to voluntarily relinquish their approval; 7. Require that all STR hosts remit TOT every six months, otherwise revocation proceedings can be initiated; 8. Remove the Planning Commission’s recommended parking requirement for homestays; and 9. Concur with staff’s recommended changes to the definitions of homestays and vacation rentals. Each of the City Council’s recommended changes to the draft Ordinance have been incorporated and are included in the attachments to this staff report. Following the September 13, 2022 hearing, staff considered whether a minimum amount of TOT should be required of STRs during each 6-month period of TOT payment. Should Council wish to incorporate such a requirement, the Ordinance may be modified prior to reintroduction during the hearing. Following introduction, the Ordinance will be presented for adoption at the next regular City Council meeting. Page 404 of 512 Item 9.a. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 September 27, 2022 Page 4 ALTERNATIVES: 1. Introduce the proposed Ordinance amending the Short-Term Rental regulations within the City; 2. Revise and introduce an Ordinance amending the Short-Term Rental regulations within the City; or 3. Provide other direction to staff. ADVANTAGES: Introduction of the proposed Ordinance will allow the City to further regulate Short Term Rentals in a manner that is harmonious with the existing character of the neighborhoods in which the rentals exist. DISADVANTAGES: If the proposed Ordinance is ultimately adopted, it will establish a cap on Short Term Rentals that will reduce potential TOT revenue from new STRs. Furthermore, adoption of the Ordinance will render all existing STRs legally nonconforming. ENVIRONMENTAL REVIEW: In compliance with the California Environmental Quality Act (CEQA), the Community Development Department has determined that the adoption of an ordinance to implement amendments to the short-term rental regulations is categorically exempt from CEQA pursuant to Section 15305 – Minor Alterations in Land Use Limitations. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Proposed Ordinance 2. Proposed Ordinance with redlines showing changes from September 13, 2022 introduction 3. Minutes from the September 3, 2019 Planning Commission meeting 4. Minutes from the October 12, 2021 City Council meeting 5. Staff Report and Minutes from the March 22, 2022 City Council meeting 6. Staff Report and Minutes from the August 2, 2022 Planning Commission meeting 7. Staff report and attachments from the September 13, 2022 City Council meeting 8. Draft Minutes from the September 13, 2022 City Council meeting Page 405 of 512 ATTACHMENT 1 ORDINANCE NO. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE REGARDING VACATION RENTALS AND HOMESTAYS WHEREAS, the City of Arroyo Grande (“City”) currently regulates vacation rentals and homestays as established by Ordinance No. 663; and WHEREAS, due to the increasing popularity of vacation rentals and homestays, the City Council held a study session on March 22, 2022 to discuss impacts and complaints associated with short term rentals; and WHEREAS, Council directed staff to amend existing regulations to ensure that impacts are addressed and mitigated and that the character of existing neighborhoods is maintained, while providing an expanded type of lodging facility available within the City; and WHEREAS, it is the purpose of this Ordinance to protect the public health, safety, and welfare within the City by establishing rules and requirements for vacation rentals and homestays; and WHEREAS, the City of Arroyo Grande has duly initiated amendments to the Arroyo Grande Municipal Code (“AGMC”); and WHEREAS, the Planning Commission of the City of Arroyo Grande, after giving notices thereof as required by law, held a public hearing on August 2, 2022 concerning this code amendment and carefully considered all pertinent testimony and the staff report offered in the matter as presented; and WHEREAS, on August 2, 2022, the Planning Commission of the Arroyo Grande recommended to the City Council amending Sections 16.52.230 and 16.52.240 of the Arroyo Grande Municipal Code; and WHEREAS, the City Council has, after giving notice thereof as required by law, held a public hearing on September 13, 2022, concerning the proposed amendments to AGMC Sections 16.52.230 and 16.52.240; and WHEREAS, the City Council has carefully considered all pertinent testimony and the staff report, its attachments and all supporting materials referenced therein or offered in the matter as presented at the public hearing. NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Arroyo Grande as follows: SECTION 1: The above recitals and findings are true and correct and incorporated herein by this reference. Page 406 of 512 ORDINANCE NO. PAGE 2 SECTION 2: Arroyo Grande Municipal Code Section 16.52.230 is hereby amended as follows: SECTION 16.52.230 – VACATION RENTALS A. Purpose and intent. The purpose of these regulations is to ensure that vacation rentals located in the city conform to the existing character of the neighborhood in which they are located and do not create an adverse impact on adjacent properties. B. Applicability. Vacation rentals may be permitted only with approval of a minor use permit. Vacation rentals shall comply with the property development standards of the underlying district and the performance standards and special conditions listed in Section 16.52.230.C. Any revocation proceedings for a vacation rental will include a public hearing. C. Performance standards and conditions for vacation rentals. 1. Operators of vacation rentals are required to obtain a minor use permit-plot plan review (Section 16.16.080) and a business license. 2. Any proposed vacation rental shall be compatible with the neighborhood in which it is located in terms of landscaping, scale and architectural character. The use shall be harmonious and compatible with the existing uses with the neighborhood 3. All Building Code and Fire Code requirements for the level of occupancy of the vacation rental shall be met. 4. All environmental health regulations shall be met. 5. The operator of the vacation rental shall, at all times while the property is being used as a vacation rental, maintain a contact person/entity within a fifteen (15) minute drive of the property. The contact person or entity must be available via telephone twenty-four (24) hours a day, seven (7) days a week, to respond to complaints regarding the use of the vacation rental. The contact person or entity shall respond, either in person or by return telephone call, with a proposed resolution to the complaint within three (3) hours between 7:00 am and 9:00 pm, and within thirty (30) minutes between 9:00 pm and 7:00 am . Vacation rental applicants shall be required to pay the City’s fee at the time of application to generate mailing labels for all property owners within 300 feet. An emergency contact shall be deemed unresponsive if no response is provided to a call for assistance. Three instances of unresponsiveness within a twelve (12) month period shall be grounds to initiate revocation proceedings. 6. The operator of the vacation rental shall annually, at the time of renewal of the business license, notify the Community Development Department of the name, address and telephone number of the contact person required in subsection 16.52.230.C.5. 7. A written notice shall be conspicuously posted inside each vacation rental unit setting forth the name, address and telephone number of the contact person Page 407 of 512 ORDINANCE NO. PAGE 3 required in subsection 16.52.230.C.5. The notice shall also set forth the address of the vacation rental, the maximum number of occupants pe rmitted to stay overnight in the unit, the maximum number of vehicles allowed to be parked on - site, and the day(s) established for garbage collection. The notice shall also provide the non-emergency number of the Arroyo Grande Police Department. 8. On-site advertising of the vacation rental is prohibited. 9. The number of overnight occupants shall be limited to two persons per bedroom and two additional persons. A bedroom shall meet the minimum size requirements as defined in the Building Code. 10. All refuse shall be stored in appropriate containers and timely placed at the curb for collection every week. 11. The operator of the vacation rental shall pay Transient Occupancy Tax (“TOT”) as required by Arroyo Grande Municipal Code Section 3.24.030. 12. Establishment of a vacation rental within five-hundred feet (500’) of an existing short term rental or school shall not be permitted. 13. Violations – violation of these requirements shall constitute grounds for revocation of the minor use permit pursuant to Section 16.16.220. 14. Vacation rentals shall not be approved within Planned Unit Developments (PUDs). 15. The total number of approved vacation rentals within the City shall not exceed ninety (90). Once the cap is reached, complete applications will be added to a waiting list that will be processed on a first-come-first-serve basis if new approvals become available. 16. Vacation rentals must remit TOT to the City at least once every six (6) months, otherwise revocation proceedings shall be initiated. 17. The listed emergency contact for a vacation rental shall not be un-responsive to neighborhood complaints three (3) times within a twelve (12) month period, otherwise revocation proceedings shall be initiated. An emergency contact shall be deemed unresponsive if no response is provided to a call for assistance. 18. Revocation proceedings shall be initiated if two (2) citations are issued by a City official or two (2) arrests are made within a twelve (12) month period due to rental guest behavior. 19. Vacation rentals shall be required to provide two (2) off-street parking spaces for use by rental guests. These spaces shall be kept free and clear and the rental guest shall be made aware of their location for preferred use during the duration of the stay. SECTION 3: Arroyo Grande Municipal Code Section 16.52.240 is hereby amended as follows: SECTION 16.52.240 – HOMESTAYS A. Purpose and Intent. The purpose of these regulations is to ensure that homestays located in the city conform to the existing character of the neighborhood in which they are located and do not create an adverse impact on adjacent properties. Page 408 of 512 ORDINANCE NO. PAGE 4 B. Applicability. Homestays may be permitted only with approval of a minor use permit. Homestays shall comply with the property development standards of the underlying district and the performance standards and special conditions listed in subsection C. Any revocation proceedings for a homestay will include a public hearing. C. Performance Standards and Conditions for Homestays. 1. Operators of homestays are required to obtain a minor use permit-plot plan review (Section 16.16.080) and a business license. 2. Any proposed homestay shall be compatible with the neighborhood in which it is located in terms of landscaping, scale and architectural character. The use shall be harmonious and compatible with the existing uses with the neighborhood. 3. All Building Code and Fire Code requirements for the level of occupancy of the homestay shall be met. 4. All environmental health regulations shall be met. 5. The operator shall reside on the premises during the entire duration of the rental stay. 6. Individual guest stays shall be limited to fourteen (14) days, with a seven -day period between stays. 7. On-site advertising of the homestay is prohibited. 8. A bedroom shall meet the minimum size requirements as defined in the Building Code. 9. The operator of the homestay shall pay Transient Occupancy Tax (“TOT”) as required by Arroyo Grande Municipal Code Section 3.24.030. 10. Establishment of a homestay within five-hundred (500) feet of an existing short term rental or school shall not be permitted. 11. Violations. Violation of these requirements shall constitute grounds for revocation of the minor use permit pursuant to Section 16.16.220. 12. Homestays must remit TOT to the City at least once every six (6) months, otherwise revocation proceedings shall be initiated. 13. Revocation proceedings shall be initiated if two (2) citations are issued by a City official or two (2) arrests are made within a twelve (12) month period due to rental guest behavior. SECTION 4: Arroyo Grande Municipal Code Section 16.04.070 is hereby amended as follows: 16.04.070.C. Definitions “Homestay” means a structure on an owner-occupied parcel where a maximum of two (2) short-term lodging rooms are provided for compensation while the property owner is present on-site. “Short term rental” means a homestay or vacation rental. Page 409 of 512 ORDINANCE NO. PAGE 5 “Vacation rental” means a structure or structures on a property being rented for less than thirty (30) days without concurrently being occupied by the owner/operator where the short-term lodging is provided for compensation. SECTION 5: Upon adoption of this Ordinance, the City Clerk shall file a Notice of Exemption pursuant to 14 CCR § 15062. SECTION 6: A summary of this Ordinance shall be published in a newspaper published and circulated in the City of Arroyo Grande at least five (5) days prior to the City Council meeting at which the proposed Ordinance is to be adopted. A certified copy of the full text of the proposed Ordinance shall be posted in the office of the City Clerk. Within fifteen (15) days after adoption of the Ordinance, the summary with the names of those City Council Members voting for and against the Ordinance shall be published again, and the City Clerk shall post a certified copy of the full text of such adopted Ordinance. SECTION 7: If any provision of this Ordinance or the application thereof to any person or circumstance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional. SECTION 8: This Ordinance shall take effect thirty (30) days from the date of adoption. On motion of Council Member , seconded by Council Member , and on the following roll call vote to wit: AYES: NOES: ABSENT: The foregoing Ordinance was adopted this ___ day of _________, 2022. Page 410 of 512 ORDINANCE NO. PAGE 6 ___________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: ___________________________________ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: ___________________________________ WHITNEY McDONALD, CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 411 of 512 ATTACHMENT 2 ORDINANCE NO. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE REGARDING VACATION RENTALS AND HOMESTAYS WHEREAS, the City of Arroyo Grande (“City”) currently regulates vacation rentals and homestays as established by Ordinance No. 663; and WHEREAS, due to the increasing popularity of vacation rentals and homestays, the City Council held a study session on March 22, 2022 to discuss impacts and complaints associated with short term rentals; and WHEREAS, Council directed staff to amend existing regulations to ensure that impacts are addressed and mitigated and that the character of existing neighborhoods is maintained, while providing an expanded type of lodging facility available within the City; and WHEREAS, it is the purpose of this Ordinance to protect the public health, safety, and welfare within the City by establishing rules and requirements for vacation rentals and homestays; and WHEREAS, the City of Arroyo Grande has duly initiated amendments to the Arroyo Grande Municipal Code (“AGMC”); and WHEREAS, the Planning Commission of the City of Arroyo Grande, after giving notices thereof as required by law, held a public hearing on August 2, 2022 concerning this code amendment and carefully considered all pertinent testimony and the staff report offered in the matter as presented; and WHEREAS, on August 2, 2022, the Planning Commission of the Arroyo Grande recommended to the City Council amending Sections 16.52.230 and 16.52.240 of the Arroyo Grande Municipal Code; and WHEREAS, the City Council has, after giving notice thereof as required by law, held a public hearing on September 13, 2022, concerning the proposed amendments to AGMC Sections 16.52.230 and 16.52.240; and WHEREAS, the City Council has carefully considered all pertinent testimony and the staff report, its attachments and all supporting materials referenced therein or offered in the matter as presented at the public hearing. NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Arroyo Grande as follows: Page 412 of 512 ORDINANCE NO. PAGE 2 SECTION 1: The above recitals and findings are true and correct and incorporated herein by this reference. SECTION 2: Arroyo Grande Municipal Code Section 16.52.230 is hereby amended as follows: SECTION 16.52.230 – VACATION RENTALS A. Purpose and intent. The purpose of these regulations is to ensure that vacation rentals located in the city conform to the existing character of the neighborhood in which they are located and do not create an adverse impact on adjacent properties. B. Applicability. Vacation rentals may be permitted only with approval of a minor use permit. Vacation rentals shall comply with the property development standards of the underlying district and the performance standards and special conditions listed in Section 16.52.230.C. Any revocation proceedings for a vacation rental will include a public hearing. C. Performance standards and conditions for vacation rentals. 1. Operators of vacation rentals are required to obtain a minor use permit-plot plan review (Section 16.16.080) and a business license. 2. Any proposed vacation rental shall be compatible with the neighborhood in which it is located in terms of landscaping, scale and architectural character. The use shall be harmonious and compatible with the existing uses with the neighborhood 3. All Building Code and Fire Code requirements for the level of occupancy of the vacation rental shall be met. 4. All environmental health regulations shall be met. 5. The operator of the vacation rental shall, at all times while the property is being used as a vacation rental, maintain a contact person/entity within a fifteen (15) minute drive of the property. The contact person or entity must be available via telephone twenty-four (24) hours a day, seven (7) days a week, to respond to complaints regarding the use of the vacation rental. The contact person or entity shall respond, either in person or by return telephone call, with a proposed resolution to the complaint within three (3) hours between 7:00 am and 9:00 pm, and within thirty (30) minutes between 9:00 pm and 7:00 am . Vacation rental applicants shall be required to pay the City’s fee at the time of application to generate mailing labels for all property owners within 300 feet. 6. The operator of the vacation rental shall annually, at the time of renewal of the business license, notify the Community Development Department of the name, address and telephone number of the contact person required in subsection 16.52.230.C.5. 7. A written notice shall be conspicuously posted inside each vacatio n rental unit setting forth the name, address and telephone number of the contact person required in subsection 16.52.230.C.5. The notice shall also set forth the address Page 413 of 512 ORDINANCE NO. PAGE 3 of the vacation rental, the maximum number of occupants permitted to stay overnight in the unit, the maximum number of vehicles allowed to be parked on - site, and the day(s) established for garbage collection. The notice shall also provide the non-emergency number of the Arroyo Grande Police Department. 8. On-site advertising of the vacation rental is prohibited. 9. The number of overnight occupants shall be limited to two persons per bedroom and two additional persons. A bedroom shall meet the minimum size requirements as defined in the Building Code. 10. All refuse shall be stored in appropriate co ntainers and timely placed at the curb for collection every week. 11. The operator of the vacation rental shall pay Transient Occupancy Tax (“TOT”) as required by Arroyo Grande Municipal Code Section 3.24.030. 12. Establishment of a vacation rental within five-hundred feet (500’) of an existing short term rental or school shall not be permitted. 13. Violations – violation of these requirements shall constitute grounds for revocation of the minor use permit pursuant to Section 16.16.220. 14. Vacation rentals shall not be approved within Planned Unit Developments (PUDs). 15. The total number of approved vacation rentals within the City shall not exceed ninety (90). Once the cap is reached, complete applications will be added to a waiting list that will be processed on a first-come-first-served basis if new approvals become available. 16. Vacation rentals must remit TOT to the City at least once every six (6) months, otherwise revocation proceedings shall be initiated. 17. The listed emergency contact for a vacation rental shall not be un-responsive to neighborhood complaints three (3) times within a twelve (12) month period, otherwise revocation proceedings shall be initiated. An emergency contact shall be deemed unresponsive if no response is provided to a call for assistance. 18. Revocation proceedings shall be initiated if two (2) citations are issued by a City official or two (2) arrests are made within a twelve (12) month period d ue to rental guest behavior. 19. Vacation rentals shall be required to provide two (2) off-street parking spaces for use by rental guests. These spaces shall be kept free and clear and the rental guest shall be made aware of their location for preferred use during the duration of the stay. SECTION 3: Arroyo Grande Municipal Code Section 16.52.240 is hereby amended as follows: SECTION 16.52.240 – HOMESTAYS A. Purpose and Intent. The purpose of these regulations is to ensure that homestays located in the city conform to the existing character of the neighborhood in which they are located and do not create an adverse impact on adjacent properties. B. Applicability. Homestays may be permitted only with approval of a minor use permit. Homestays shall comply with the property development standards of the Page 414 of 512 ORDINANCE NO. PAGE 4 underlying district and the performance standards and special conditions listed in subsection (C). Any revocation proceedings for a vacation rental will include a public hearing. C. Performance Standards and Conditions for Homestays. 20. Operators of homestays are required to obtain a minor use permit-plot plan review (Section 16.16.080) and a business license. 21. Any proposed homestay shall be compatible with the neighborhood in which it is located in terms of landscaping, scale and architectural character. The use shall be harmonious and compatible with the existing uses with the neighborhood. 22. All Building Code and Fire Code requirements for the level of occupancy of the homestay shall be met. 23. All environmental health regulations shall be met. 24. The operator shall reside on the premises during the entire duration of the rental stay. 25. Individual guest stays shall be limited to fourteen (14) days, with a seven -day period between stays. 26. On-site advertising of the homestay is prohibited. 27. A bedroom shall meet the minimum size requirements as defined in the Building Code. 28. The operator of the homestay shall pay Transient Occupancy Tax (“TOT”) as required by Arroyo Grande Municipal Code Section 3.24.030. 29. Establishment of a homestay within five-hundred (500) feet of an existing short term rental or school shall not be permitted. 30. Violations. Violation of these requirements shall constitute grounds for revocation of the minor use permit pursuant to Section 16.16.220. 31. Homestays must remit TOT to the City at least once every six (6) months, otherwise revocation proceedings shall be initiated. 32. Revocation proceedings shall be initiated if two (2) citations are issued by a City official or two (2) arrests are made within a twelve (12) month period due to rental guest behavior. SECTION 4: Arroyo Grande Municipal Code Section 16.04.070 is hereby amended as follows: 16.04.070.C. Definitions “Homestay” means a structure on an owner-occupied parcel where a maximum of two (2) short-term lodging rooms are provided for compensation while the property owner is present on-site. “Vacation rental” means a structure or structures on a property being rented for less than thirty (30) days without concurrently being occupied by the owner/operator where the short-term lodging is provided for compensation. Page 415 of 512 ORDINANCE NO. PAGE 5 “Short term rental” means a homestay or vacation rental. SECTION 5: Upon adoption of this Ordinance, the City Clerk shall file a Notice of Exemption pursuant to 14 CCR § 15062. SECTION 6: A summary of this Ordinance shall be published in a newspaper published and circulated in the City of Arroyo Grande at least five (5) days prior to the City Council meeting at which the proposed Ordinance is to be adopted. A certified copy of the full text of the proposed Ordinance shall be posted in the office of the City Clerk. Within fifteen (15) days after adoption of the Ordinance, the summary with the names of those City Council Members voting for and against the Ordinance shall be published again, and the City Clerk shall post a certified copy of the full text of such adopted Ordinance. SECTION 7: If any provision of this Ordinance or the application thereof to any person or circumstance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional. SECTION 8: This Ordinance shall take effect thirty (30) days from the date of adoption. On motion of Council Member , seconded by Council Member , and on the following roll call vote to wit: AYES: NOES: ABSENT: The foregoing Ordinance was adopted this ___th day of _________, 2022. Page 416 of 512 ORDINANCE NO. PAGE 6 ___________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: ___________________________________ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: ___________________________________ WHITNEY McDONALD, CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 417 of 512 ACTION MINUTES MEETING OF THE PLANNING COMMISSION TUESDAY, SEPTEMBER 3, 2019 ARROYO GRANDE COUNCIL CHAMBERS 215 EAST BRANCH STREET ARROYO GRANDE, CALIFORNIA 1.CALL TO ORDER Chair Martin called the Planning Commission meeting to order at 6:00 p.m. 2. ROLL CALL Planning Commission: Commissioners Jamie Maraviglia,Andrea Montes,Ken Sage,Vice Chair Frank Schiro and Chair Glenn Martin were present. Staff Present:Community Development Director Teresa McClish,Planning Manager Matt Downing,Assistant Planner Andrew Perez,and Permit Technician Patrick Holub were present. 3. FLAG SALUTE Commissioner Maraviglia led the flag salute. 4. AGENDA REVIEW None. 5. COMMUNITY COMMENTS AND SUGGESTIONS None. 6. WRITTEN COMMUNICATIONS The Commission received the following material after preparation of the agenda: 1.One memo dated September 3,2019 from Community Development Director McClish related to Agenda Item 9.a. 7. CONSENT AGENDA 7.a.CONSIDERATION OF APPROVAL OF MINUTES Recommended Action:Approve the minutes of the August 20,2019 Regular Planning Commission Meeting. 7.b.CONSIDERATION OF CERTIFICATE OF COMPLIANCE 19-001;LOCATION –460 COACH ROAD; APPLICANT – MARTIN DELEON, MBS LAND SURVEYS Recommended Action:It is recommended that the Planning Commission adopt a Resolution approving Certificate of Compliance 19-001. Action:Vice Chair Schiro moved to approve the consent agenda as submitted.Commissioner Maraviglia seconded and the motion passed on the following voice vote: AYES:Schiro, Maraviglia, Montes, Sage, and Martin NOES:None ABSENT:None 8. PUBLIC HEARINGS None. ATTACHMENT 3 Page 418 of 512 PLANNING COMMISSION PAGE 2 MINUTES SEPTEMBER 3, 2019 9. NON-PUBLIC HEARINGS 9.a.CONSIDERATION OF A STATUS REPORT ON THE CITY’S SHORT TERM RENTAL ORDINANCE (Downing) Recommended Action:It is recommended that the Planning Commission discuss the short term rental ordinance,provide feedback to staff,and make a recommendation to the City Council, if necessary. Planning Manager Downing presented the staff report and responded to Commissioner questions regarding enforcement, parking, and the permitting process. Chair Martin opened the public comment period. Jimmy Lehey asked whether the number of vacation rentals impacts the price of rental housing in the City. Chair Martin closed the public comment period. It was the consensus of the Commission that the following items be discussed by the City Council: 1.Implementation of parking requirements; 2.Administrative fines for non-permitted short term rentals; 3.Utilization of compliance technology to address non-permitted short term rentals; and 4.Reconsideration of current buffer distances or methods. 10. ADMINISTRATIVE DECISIONS SINCE AUGUST 20, 2019 Case No.Applicant Address Description Action Planner PPR 19-019 Tom & Karen Franck 626 Cerro Vista Circle Establishment of a vacation rental in an existing single family residence. A A. Perez PPR 19-023 Figueroa Mountain Brewery 1462 E. Grand Ave. Establishment of a new outdoor dining area in an existing parking lot for an existing restaurant. A A. Perez TUP 19-007 St. Patrick School 900 W. Branch Street 57th Annual Saint Patrick BBQ and Auction A A. Perez PPR 18-030 Aaron & Mallory Scribner 408 Bakeman Street Establishment of a vacation rental in an existing single family residence A A. Perez ARCH 19- 002 Arroyo Grande Comercial, LLC 1570 W. Branch Street Commercial façade approval for entitled drive-thru A M. Downing 11. COMMISSION COMMUNICATIONS Vice Chair Schiro reminded the public that the Arroyo Grande Beer Feast event,which will raise funds for Meals on Wheels, will be held on October 12, 2019. Page 419 of 512 PLANNING COMMISSION PAGE 3 MINUTES SEPTEMBER 3, 2019 12. STAFF COMMUNICATIONS Community Development Director McClish informed the Commission that the September 17th meeting would be cancelled due to a lack of a quorum,while staff and some Commissioners attend the American Planning Associate Conference in Santa Barbara. 13. ADJOURNMENT The meeting adjourned at 7:48 p.m. ATTEST: /s/ Patrick Holub, Permit Technician (Approved at PC Mtg 10-01-2019) Page 420 of 512 ACTION MINUTES REGULAR MEETING OF THE CITY COUNCIL TUESDAY, OCTOBER 12, 2021 COUNCIL CHAMBERS, 215 E. BRANCH STREET ARROYO GRANDE, CALIFORNIA Given the recent increase in COVID-19 cases in San Luis Obispo County, and in compliance with Assembly Bill (AB) 361, which allows for a deviation of teleconference rules required by the Ralph M. Brown Act, this meeting was held by teleconference. 1.CALL TO ORDER Mayor Ray Russom called the Regular City Council Meeting to order at 6:00 p.m. 2. ROLL CALL City Council: Council Members Lan George, Kristen Barneich, Keith Storton, Mayor Pro Tem Jimmy Paulding, and Mayor Caren Ray Russom were all present via teleconference. Staff Present: City Manager Whitney McDonald, Assistant City Manager/Public Works Director Bill Robeson, City Attorney Timothy Carmel, City Clerk Jessica Matson, Administrative Services Director Nicole Valentine, Utilities Manager Shane Taylor. 3. MOMENT OF REFLECTION 4. FLAG SALUTE Mayor Ray Russom led the flag salute. 5. AGENDA REVIEW 5.a. Closed Session Announcements. None. 5.b. Ordinances read in title only. None. 6.SPECIAL PRESENTATIONS 6.a. Update Regarding Countywide COVID-19 Efforts. Recommended Action: Receive update, accept public comments, discuss, and provide direction, as necessary. City Manager McDonald provided a brief update on COVID-19 efforts and responded to questions from Council. Mayor Ray Russom invited public comment. No public comments were received. No action was taken on this item. ATTACHMENT 4 Page 421 of 512 Minutes: City Council Page 2 Tuesday, October 12, 2021 6.b. City Manager Communications. Recommended Action: Receive correspondence/comments as presented by the City Manager and provide direction, as necessary. City Manager McDonald provided an update on Halloween events and stated that the Recreation Services Department will be hosting a Halloween Carnival and Haunted Maze and that the Halloween in the Village event will not take place this year. Mayor Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.c. Honorary Proclamation Declaring October 2021 as “Domestic Violence Action Month”. Mayor Ray Russom read the Honorary Proclamation Declaring October 2021 as “Domestic Violence Action Month”. Mayor Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.d. Mayor’s Commendation Recognizing the Southwest Regional Council of Carpenters Local Union 805. Mayor Ray Russom read the Mayor’s Commendation Recognizing the Southwest Regional Council of Carpenters Local Union. Autumn Brown, and Manley McNinch, accepted the Commendation. Mayor Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.e. Presentation from San Luis Obispo Council of Governments – Commute with Confidence. Catalina Hubbard, Rideshare Outreach Coordinator, provided a presentation on the San Luis Obispo Council of Governments campaign, Commute with Confidence. Mayor Ray Russom invited public comment. No public comments were received. No action was taken on this item. 7. COMMUNITY COMMENTS AND SUGGESTIONS Mayor Ray Russom invited public comment. Speaking from the public were Jeff Edwards, Kris Roudebush, Jim Guthrie, Stewart Errico, Francine Errico, Manley McNinch, and Linda Busek. No further public comments were received. Staff responded to questions from Council. Page 422 of 512 Minutes: City Council Page 3 Tuesday, October 12, 2021 8. CONSENT AGENDA Mayor Ray Russom asked the Council if there were any questions or any items to be pulled from the consent agenda for further discussion. Council commented on Item 8.f. and staff responded to questions from Council on Item 8.g. City Manager McDonald acknowledged the Supplemental Information regarding Item 8.h. and requested that the Council continue the item to a date uncertain. Mayor Ray Russom invited public comment. No public comments were received. Action: Council Member Storton moved to approve Consent Agenda Items 8.a. through 8.g., with the recommended courses of action. Council Member George seconded, and the motion passed on the following roll-call vote: AYES: Storton, George, Barneich, Paulding, Ray Russom NOES: None ABSENT: None 8.a. Consideration of Cash Disbursement Ratification. Action: Ratified the listing of cash disbursements for the period September 16, 2021 through September 30, 2021. 8.b. Consideration of Approval of Minutes. Action: Approved the minutes of the Special and Regular City Council Meetings of September 28, 2021, as submitted. 8.c. Adoption of a Resolution Declaring a Continued Local Emergency Related to the Coronavirus (COVID-19) Pandemic. Action: Adopted a Resolution entitled: “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING A CONTINUED LOCAL EMERGENCY RELATED TO THE CORONAVIRUS (COVID-19) PANDEMIC”. 8.d. Cancellation of the December 28, 2021 City Council Meeting. Action: Cancelled the regularly scheduled Council meeting of December 28, 2021 due to the holidays. 8.e. Consideration to Approve an Agreement for Consultant Services with Salas O’Brien for the Five Cities Fire Authority Station 1 Emergency Generator Replacement Project, PW 2021-09. Action: 1) Approved an Agreement for Consultant Services with Salas O'Brien in the amount of $46,780 for design and construction support services of the FCFA Station 1 Emergency Generator Replacement Project; and 2) Approved an amendment to the Fiscal Year 2021-22 Capital Improvement Program budget to transfer $4,280 of General Fund from fund balance to the subject project. 8.f. Consideration of a Resolution Amending the Public Art Guidelines and Public Art Donation Program. Action: Adopted a Resolution entitled: “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING THE PUBLIC ART GUIDELINES AND PUBLIC ART DONATION PROGRAM”. 8.g. Approve and Authorize the Mayor on Behalf of the City Council to Sign a Letter of Support for the Sustainable Transportation Planning Grant Application for an Active Transportation Plan. Action: Approved and authorized the Mayor to sign the letter of support for the STPG Page 423 of 512 Minutes: City Council Page 4 Tuesday, October 12, 2021 grant application. 8. ITEMS PULLED FROM THE CONSENT AGENDA 8.h. Authorize a Resolution to Reduce Penalties for Past Due Water Bills Related to the COVID-19 Pandemic (ROBESON/VALENTINE) Recommended Action: Adopt a Resolution to allow the City’s Administrative Services Director to reduce penalties to 10% of customers’ original water bill from May 2020 through November 2021. Action: Mayor Ray Russom moved to continue the item to a date uncertain. Council Member George seconded, and the motion passed on the following roll-call vote: AYES: Ray Russom, George, Barneich, Storton, Paulding NOES: None ABSENT: None 9. PUBLIC HEARINGS 9.a. Continued Consideration of Approval of a Resolution Declaring a Stage 1 Water Shortage Emergency. Utilities Manager Shane Taylor presented the item and recommended that the Council: 1) Conduct a Public Hearing in accordance with Water Code Section 350, et seq.; 2) Adopt a Resolution declaring a Stage 1 Water Shortage Emergency and implementing Emergency Water Shortage Restrictions and Regulations in accordance with California Water Code Section 350, et seq., and Arroyo Grande Municipal Code Section 13.07.030(A); and 3) Appropriate $2,800 from water fund balance and $1,200 from sewer fund balance for the cost to mail out baseline letters. Staff responded to questions from Council. Mayor Ray Russom opened the public hearing. Speaking from the public were Jim Guthrie, and Francine Errico. City Clerk Matson read into the record written correspondence received from Patty Welsh. Upon hearing no further comments, Mayor Ray Russom closed the public hearing. Action: Council Member Storton moved to adopt a Resolution entitled: “A Resolution of the City Council of the City of Arroyo Grande Declaring a Stage 1 Water Shortage Emergency in Accordance with California Water Code Section 350 and Arroyo Grande Municipal Code Section 13.07.030”; and Appropriate $2,800 from water fund balance and $1,200 from sewer fund balance for the cost to mail out baseline letters. Mayor Pro Tem Paulding seconded, and the motion passed on the following roll-call vote: AYES: Storton, Paulding, Barneich, George, Ray Russom NOES: None ABSENT: None Page 424 of 512 Minutes: City Council Page 5 Tuesday, October 12, 2021 Mayor Ray Russom called for a brief break at 8:05 p.m. The Council reconvened at 8:11 p.m. 10. OLD BUSINESS: 10.a. Discuss and Consider Allocations of Anticipated American Rescue Plan Act Funding Not Previously Allocated by Council. City Manager McDonald presented the item and recommended that the Council: 1) Appropriate $1,254,275 of ARPA Funds to additional Water, Sewer, and Stormwater Infrastructure projects and qualified anticipated City expenditures related to the COVID-19 pandemic as recommended by the Ad Hoc Committee; and 2) Consider and provide direction regarding allocation of the remaining $552,016 of anticipated ARPA Funds to other qualified uses consistent with US Treasury guidance. Council discussed the recommended allocations and applications for funding received. Council expressed support for providing an opportunity for non-profit organizations to apply for funding. Mayor Ray Russom invited public comment. Speaking from the public were Wendy Wendt, Anne Wyatt, Shana Paulson, Ken Dalebout, Jamie Sanbonmatsu, and Marcia Alter. No further comments were received. Action: Mayor Pro Tem Paulding moved to appropriate $1,254,275 of ARPA Funds to additional Water, Sewer, and Stormwater Infrastructure projects and qualified anticipated City expenditures related to the COVID-19 pandemic as recommended by the Ad Hoc Committee; allocate $300,000 to the 5Cities Homeless Coalition and direct staff to bring back specific scope for the project; allocate $114,129 for non-profit assistance/community service grant program to be split between the next two fiscal years; allocate $100,000 for child care assistance and direct staff to bring back specific scope for the project; and allocate $37,887 to SmartShare ADU SLO to be used for Arroyo Grande residents and require that the ADU not be converted to a vacation rental. Council Member Barneich seconded, and the motion passed on the following roll-call vote: AYES: Paulding, Barneich, Storton, George, Ray Russom NOES: None ABSENT: None 11. NEW BUSINESS None. 12. COUNCIL COMMUNICATIONS Mayor Pro Tem Paulding requested that an item regarding vacation rental policies be placed on a future agenda for consideration. Council Member George concurred. Council Member Barneich requested the item include an update on enforcement and for more information to be included on the City website. Page 425 of 512 Minutes: City Council Page 6 Tuesday, October 12, 2021 Mayor Ray Russom announced that the Mayor's Challenge: Halloween House Decorating Contest will be taking place and urged residents to participate; that those wanting to help fund Arroyo Grande Public Art can join in “Dining with a Purpose” at Rooster Creek on Tuesday, November 16th; and that she will be meeting with Vanessa Carr from Governor Newsom’s office and will report back on that meeting. 13. CLOSED SESSION None. 14. ADJOURNMENT There being no further business to come before the City Council, Mayor Ray Russom adjourned the meeting at 10:44 p.m. /s/Caren Ray Russom, Mayor ATTEST: /s/Jessica Matson, City Clerk (Approved at CC Mtg 10-26-2021) Page 426 of 512 Attachment 5 – Staff Report and Minutes from the March 22, 2022 City Council Meeting STR Study Session Staff Report Minutes from the March 22, 2022 City Council Meeting ATTACHMENT 5 Page 427 of 512 Attachment 6 – Staff Report and Minutes from the August 2, 2022 Planning Commission Meeting August 2nd, 2022 Planning Commission STR Staff Report Minutes from the August 2, 2022 Planning Commission Meeting Page 428 of 512 Attachment 7 – Staff Report and Minutes from the September 13, 2022 City Council Meeting September 13th, 2022 City Council STR Staff Report Minutes from the September 13, 2022 City Council Meeting can be found attached on the following pages. Page 429 of 512 1 ACTION MINUTES REGULAR MEETING OF THE CITY COUNCIL/SUCCESSOR AGENCY TO THE DISSOLVED ARROYO GRANDE REDEVELOPMENT AGENCY September 13, 2022, 6:00 p.m. Hybrid City Council Chamber/Virtual Zoom Meeting 215 East Branch Street, Arroyo Grande Council/Board Members Present: Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, Council/Board Member Storton Council/Board Members Absent: Council/Board Member Barneich Staff Present: City Clerk Jessica Matson, City Attorney Timothy Carmel, City Manager Whitney McDonald, Assistant City Manager/Public Works Director Bill Robeson, Administrative Services Director Nicole Valentine, Community Development Director Brian Pedrotti, Chief of Police Michael Martinez, Planning Manager Andrew Perez, Associate Planner Patrick Holub, Contract Building Official Mark Meyers Given the recent increase in COVID-19 cases in San Luis Obispo County, and in compliance with Assembly Bill (AB) 361, which allows for a deviation of teleconference rules required by the Ralph M. Brown Act, this meeting was held by teleconference. _____________________________________________________________________ 1. CALL TO ORDER Mayor/Chair Ray Russom called the Regular City Council/Successor Agency to the Dissolved Arroyo Grande Redevelopment Agency Meeting to order at 6:00 p.m. 2. ROLL CALL City Clerk Matson took roll call. 3. MOMENT OF REFLECTION 4. FLAG SALUTE Page 430 of 512 2 Felix Esparza, Latino Outreach Council, led the flag salute. 5. AGENDA REVIEW Mayor/Chair Ray Russom noted that Item 9.b. will be heard before 9.a. and 11.a., and Council Communications will be heard before the Public Hearing items. 5.a Closed Session Announcements None. 5.b Ordinances read in title only Moved by Mayor/Chair Ray Russom Seconded by Council/Board Member Storton AYES (4): Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (1): Council/Board Member Barneich Passed (4 to 0) 6. SPECIAL PRESENTATIONS 6.a Update Regarding Countywide COVID-19 Efforts City Manager McDonald provided a brief update on COVID-19 including available booster vaccines and testing sites. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.b City Manager Communications City Manager McDonald provided information regarding the City's summer concert series, the Elm Street Inclusive Playground groundbreaking event; and the first Joint City Council meeting regarding the Central Coast Blue Project. Assistant City Manager/Public Works Director Robeson provided information regarding awards received for the Bridge Street Bridge Rehabilitation Project. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. Receive correspondence/comments as presented by the City Manager and Provide direction, as necessary. 6.c Honorary Proclamation Recognizing September 15-October 15, 2022 as "National Hispanic Heritage Month" Mayor/Chair Ray Russom read the Honorary Proclamation recognizing September 15 - October 15, 2022 as "National Hispanic Heritage Month". Felix Esparza, Latino Outreach Council, Page 431 of 512 3 accepted the proclamation. The Latino Outreach Council and Mexican Consulate presented a Certificate of Recognition to the Council for highlighting the contributions made by the Latino and Mexican community in the city of Arroyo Grande and enhancing and connecting the diverse and multi-racial and multi-cultural mosaic of cultures during Hispanic Heritage Month. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.d Introduction of Police Commander Culver Police Chief Martinez introduced Police Commander Culver, and highlighted his educational and professional background. 6.e Update on Active Shooter Drill Police Commander Culver provided information regarding the recent multi-jurisdictional Active Shooter Drill and responded to questions from Council. Mayor/Chair Ray Russom invited public comment. Speaking from the public was Ben Franco and Rachelle Krelle. No further public comments were received. No Action was taken on this item. 7. COMMUNITY COMMENTS AND SUGGESTIONS Mayor/Chair Ray Russom invited public comment. Speaking from the public was Jeff Edwards. No further public comments were received. 8. CONSENT AGENDA Mayor/Chair Ray Russom asked the Council/Board if there were any questions or any items to be pulled from the consent agenda for further discussion. Staff responded to Council questions regarding Item 8.j. Mayor/Chair Ray Russom invited public comment. No public comments were received. Moved by Council/Board Member Storton Seconded by Council/Board Member Paulding Approve Consent Agenda Items 8.a. through 8.m., with the recommended courses of action. AYES (4): Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (1): Council/Board Member Barneich Passed (4 to 0) 8.a Consideration of Cash Disbursement Ratification Ratified the listing of cash disbursements for the period of August 1 through August 15, 2022. 8.b Consideration of Statement of Investment Deposits Page 432 of 512 4 Received and filed the attached report listing investment deposits of the City of Arroyo Grande as of July 31, 2022, as required by Government Code Section 53646(b). 8.c Consideration of Adoption of Resolution Approving the Last and Final Recognized Obligation Payment Schedule for the Successor Agency to the Arroyo Grande Redevelopment Agency Adopted a Resolution entitled: "A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY TO THE DISSOLVED ARROYO GRANDE REDEVELOPMENT AGENCY APPROVING THE LAST & FINAL RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR FISCAL YEARS 2023-38 AND APPROVING CERTAIN RELATED ACTIVITIES". 8.d Consideration of Approval of Minutes Approved the minutes of the Regular City Council Meeting of August 23, 2022, as submitted. 8.e Consideration of Adoption of a Resolution Declaring a Continued Local Emergency Related to the Coronavirus (COVID-19) Pandemic Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING A CONTINUED LOCAL EMERGENCY RELATED TO THE CORONAVIRUS (COVID-19) PANDEMIC". 8.f Consideration of Cancellation of November 8, 2022 City Council Meeting Cancelled the regularly scheduled Council meeting of November 8, 2022. 8.g Consideration of Authorizing the City Attorney to Amend the Affordable Housing Agreement for 252 S. Courtland Street Authorized the City Attorney to amend the Agreement allowing the property owner to sell the subject property to an eligible, moderate income household. 8.h Consideration of a Resolution Approving a Grant Agreement from the Office of Traffic Safety for Traffic Records Improvement and Approval of the Purchase of the Crossroads Traffic Collision Reporting and Electronic Citation Systems 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AND AUTHORIZING THE CHIEF OF POLICE TO EXECUTE AN AGREEMENT WITH THE CALIFORNIA OFFICE OF TRAFFIC SAFETY TO ACCEPT GRANT FUNDING FOR TRAFFIC RECORDS IMPROVEMENT PROJECT AND TO APPROPRIATE THE FUNDING FOR THE PROGRAM ACTIVITIES"; 2) Approved a Budget Amendment Request for FY 2022-23 in the amount of $109,000 to account for the OTS grant revenue and the expenditures for the new reporting and citation systems, and 3) Approved the sole source purchase of the Crossroads traffic collision reporting and electronic citation software programs. 8.i Consideration of a Resolution Approving a Grant Agreement with the Office of Traffic Safety for Traffic/DUI Enforcement Page 433 of 512 5 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AND AUTHORIZING THE CHIEF OF POLICE TO EXECUTE AN AGREEMENT WITH THE CALIFORNIA OFFICE OF TRAFFIC SAFETY TO ACCEPT GRANT FUNDING FOR TRAFFIC SAFETY PROGRAMS AND TO APPROPRIATE THE FUNDING FOR THE PROGRAM ACTIVITIES"; and 2) Approved a Budget Amendment Request for FY 2022-23 in the amount of $58,000 to account for the additional revenue and expenditures related to the grant. 8.j Consider Adoption of a Resolution Pursuant to Public Contract Code (PCC) Section 20168 and Authorizing Contracting Without a Competitive Solicitation for Bids Pursuant to PCC Section 22050 for FCFA Station 1 Emergency Generator Replacement 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING AN EMERGENCY AND AUTHORIZING THE IMMEDIATE EXPENDITURE OF FUNDS TO REPLACE THE EMERGENCY GENERATOR AT THE FIVE CITIES FIRE AUTHORITY STATION 1"; and 2) Authorized the City Manager, or designee, to execute a contract with a qualified contractor for construction of the project. 8.k Consideration of Acceptance of the 2021 Street Repairs Project, PW 2021-01 1) Accepted the project improvements as constructed by Ferravanti Grading & Paving in accordance with the plans and specifications for the 2021 Street Repairs Project, PW 2021-01; 2) Directed staff to file a Notice of Completion; and 3) Authorized release of retention, thirty-five (35) days after the Notice of Completion has been recorded, if no liens have been filed. 8.l Consideration of Resolution Authorizing Refund of Planning Commission Appeal Fees to the Appellants of Vacation Rental Permits Approved for 263-D Spruce Street and 1170 Linda Drive Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AUTHORIZING THE REFUND OF APPEAL FEES FOR THE APPEALS OF THE SHORT-TERM RENTALS AT 263-D SPRUCE STREET AND 1170 LINDA DRIVE". 8.m Consideration of a Grant Agreement with Smart Share Housing Solutions for Public Outreach, Education, and Project Management to Facilitate Development of Accessory Dwelling Units in Arroyo Grande Reviewed the proposal from SSHS and authorize the City Manager to execute an Agreement between the City and SSHS for public outreach, education, and project management and demonstration to facilitate the development of ADUs in the City. 9. PUBLIC HEARINGS Mayor/Chair Ray Russom noted that due to a conflict of interest, Council drew straws to see who would hear each item. 9.a Discuss and Consider Introduction of Ordinance Amending Title 16 of Arroyo Grande Municipal Code Regarding Accessory Dwelling Units; Development Code Amendment 20-001 and Consideration of a Fee Waiver Program for Certain Accessory Dwelling Units Mayor Ray Russom called for a brief break at 8:54 p.m. The Council reconvened at 9:04 p.m. Page 434 of 512 6 This item was heard after Item 9.b. Mayor Ray Russom declared a conflict of interest due to owning an ADU and left the meeting. Mayor Pro Tem George returned and presided over the meeting. Planning Manager Perez presented the staff report and recommended that Council introduce the Ordinance amending the regulations for accessory dwelling units and provide feedback about the details of the proposed fee waiver program. Staff responded to questions. Mayor Pro Tem George opened the public hearing. Speaking from the public was Ben Franco. Upon hearing no further public comments, Mayor Pro Tem George closed the public hearing and directed staff to follow-up with the commenter. Moved by Mayor Pro Tem/Vice Chair George Seconded by Council/Board Member Paulding Introduce an Ordinance entitled: "AN ORDINANCE OF THE CITY COUNCIL ADOPTING AMENDMENTS TO TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE (AGMC) REGARDING ACCESSORY DWELLING UNITS; LOCATION- CITYWIDE". City Attorney Carmel read the full title of the Ordinance into the record. AYES (3): Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor/Chair Ray Russom, and Council/Board Member Barneich Passed (3 to 0) 9.b Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 This item was heard out of order. Mayor Pro Tem George declared a conflict of interest due to owning a short-term rental and left the meeting. Community Development Director Pedrotti introduced the item. Associate Planner Holub presented the item and recommended that the Council introduce an Ordinance amending Title 16 of the AGMC regarding short-term rentals and responded to questions. Mayor Ray Russom opened the public hearing. Speaking from the public were John Hagler, Sharon Valienzi, Ben Franco, Jim Guthrie, Jami Fordyce, Corina Garsa, Francine Errico, Ken Steitz. Upon hearing no further public comments, Mayor Ray Russom closed the public hearing. Mayor Ray Russom responded to questions from the public. City Attorney Carmel provided clarification regarding references to properties being "grandfathered in." Staff responded to questions from Council. Moved by Mayor/Chair Ray Russom Seconded by Council/Board Member Paulding Page 435 of 512 7 To modify the Ordinance as follows: a cap of 90 vacation rentals with a 6-month lookback; a short-term rental buffer of 500 feet as recommended by the Planning Commission; language for revocation triggers; "unresponsive emergency contact" defined as a contact who does not answer 3 times in a 12-month rolling period and would initiate a revocation hearing; language that 2 citations or arrests in a 12-month rolling period would initiate a revocation hearing; language in outreach letters regarding voluntary relinquishment of permits for existing permit holders; language that TOT is be paid every 6 months; modify language the state the 2-space parking requirement only applies to short-term rentals; the wording "revocation proceeding" be changed to "revocation hearing;" definitions are approved as presented by staff; and to continue the introduction of an Ordinance amending Title 16 of the AGMC regarding short term rentals to a date certain of September 27, 2022. AYES (3): Mayor/Chair Ray Russom, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor Pro Tem/Vice Chair George, and Council/Board Member Barneich Passed (3 to 0) 10. OLD BUSINESS None. 11. NEW BUSINESS 11.a Discussion of Draft Ordinance Addressing Tiny Homes on Wheels This item was heard after item 9.a. Mayor Ray Russom previously declared a conflict of interest due to owning an ADU and left the meeting. Planning Manager Perez presented the report and staff responded to questions from Council. Mayor Pro Tem George invited public comment. Speaking from the public was Joe Pollon. No further public comments were received. Contract Building Official Meyers provided more information regarding tiny home accreditation organizations permitted. Mayor Pro Tem George directed staff to research accreditation options. Moved by Council/Board Member Paulding Seconded by Council/Board Member Storton Approve staff's recommendation with the modification to add language to paragraph B3 to state "in addition to the RVIA any other HCD approved association", and to ban roof top decks. AYES (3): Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor/Chair Ray Russom, and Council/Board Member Barneich Passed (3 to 0) 12. COUNCIL COMMUNICATIONS Page 436 of 512 8 This item was heard out of order. Mayor/Chair Ray Russom stated that she will be unable to attend the Mayor's meeting and asked if any other Council Member would be available to attend. Council members Storton, Paulding and George stated they would not be able to attend. 13. CLOSED SESSION None. 14. ADJOURNMENT There being no further business to come before the City Council, Mayor Pro Tem George adjourned the meeting at 9:47 p.m. _________________________ Caren Ray Russom, Mayor/Chair _________________________ Jessica Matson, City Clerk/Secretary Page 437 of 512 ATTACHMENT 8 1 ACTION MINUTES REGULAR MEETING OF THE CITY COUNCIL/SUCCESSOR AGENCY TO THE DISSOLVED ARROYO GRANDE REDEVELOPMENT AGENCY September 13, 2022, 6:00 p.m. Hybrid City Council Chamber/Virtual Zoom Meeting 215 East Branch Street, Arroyo Grande Council/Board Members Present: Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, Council/Board Member Storton Council/Board Members Absent: Council/Board Member Barneich Staff Present: City Clerk Jessica Matson, City Attorney Timothy Carmel, City Manager Whitney McDonald, Assistant City Manager/Public Works Director Bill Robeson, Administrative Services Director Nicole Valentine, Community Development Director Brian Pedrotti, Chief of Police Michael Martinez, Planning Manager Andrew Perez, Associate Planner Patrick Holub, Contract Building Official Mark Meyers Given the recent increase in COVID-19 cases in San Luis Obispo County, and in compliance with Assembly Bill (AB) 361, which allows for a deviation of teleconference rules required by the Ralph M. Brown Act, this meeting was held by teleconference. _____________________________________________________________________ 1. CALL TO ORDER Mayor/Chair Ray Russom called the Regular City Council/Successor Agency to the Dissolved Arroyo Grande Redevelopment Agency Meeting to order at 6:00 p.m. 2. ROLL CALL City Clerk Matson took roll call. 3. MOMENT OF REFLECTION Page 438 of 512 ATTACHMENT 8 2 4. FLAG SALUTE Felix Esparza, Latino Outreach Council, led the flag salute. 5. AGENDA REVIEW Mayor/Chair Ray Russom noted that Item 9.b. will be heard before 9.a. and 11.a., and Council Communications will be heard before the Public Hearing items. 5.a Closed Session Announcements None. 5.b Ordinances read in title only Moved by Mayor/Chair Ray Russom Seconded by Council/Board Member Storton AYES (4): Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (1): Council/Board Member Barneich Passed (4 to 0) 6. SPECIAL PRESENTATIONS 6.a Update Regarding Countywide COVID-19 Efforts City Manager McDonald provided a brief update on COVID-19 including available booster vaccines and testing sites. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.b City Manager Communications City Manager McDonald provided information regarding the City's summer concert series, the Elm Street Inclusive Playground groundbreaking event; and the first Joint City Council meeting regarding the Central Coast Blue Project. Assistant City Manager/Public Works Director Robeson provided information regarding awards received for the Bridge Street Bridge Rehabilitation Project. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. Receive correspondence/comments as presented by the City Manager and Provide direction, as necessary. 6.c Honorary Proclamation Recognizing September 15-October 15, 2022 as "National Hispanic Heritage Month" Page 439 of 512 ATTACHMENT 8 3 Mayor/Chair Ray Russom read the Honorary Proclamation recognizing September 15 - October 15, 2022 as "National Hispanic Heritage Month." Felix Esparza, Latino Outreach Council, accepted the proclamation. The Latino Outreach Council and Mexican Consulate presented a Certificate of Recognition to the Council for highlighting the contributions made by the Latino and Mexican community in the City of Arroyo Grande and enhancing and connecting the diverse and multi-racial and multi-cultural mosaic of cultures during Hispanic Heritage Month. Mayor/Chair Ray Russom invited public comment. No public comments were received. No action was taken on this item. 6.d Introduction of Police Commander Culver Police Chief Martinez introduced Police Commander Culver, and highlighted his educational and professional background. 6.e Update on Active Shooter Drill Police Commander Culver provided information regarding the recent multi-jurisdictional Active Shooter Drill and responded to questions from Council/Board. Mayor/Chair Ray Russom invited public comment. Speaking from the public was Ben Franco and Rachelle Krelle. No further public comments were received. No action was taken on this item. 7. COMMUNITY COMMENTS AND SUGGESTIONS Mayor/Chair Ray Russom invited public comment. Speaking from the public was Jeff Edwards. No further public comments were received. 8. CONSENT AGENDA Mayor/Chair Ray Russom asked the Council/Board if there were any questions or any items to be pulled from the consent agenda for further discussion. Staff responded to Council questions regarding Item 8.j. Mayor/Chair Ray Russom invited public comment. No public comments were received. Moved by Council/Board Member Storton Seconded by Council/Board Member Paulding Approve Consent Agenda Items 8.a. through 8.m., with the recommended courses of action. AYES (4): Mayor/Chair Ray Russom, Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (1): Council/Board Member Barneich Passed (4 to 0) 8.a Consideration of Cash Disbursement Ratification Page 440 of 512 ATTACHMENT 8 4 Ratified the listing of cash disbursements for the period of August 1 through August 15, 2022. 8.b Consideration of Statement of Investment Deposits Received and filed the attached report listing investment deposits of the City of Arroyo Grande as of July 31, 2022, as required by Government Code Section 53646(b). 8.c Consideration of Adoption of Resolution Approving the Last and Final Recognized Obligation Payment Schedule for the Successor Agency to the Arroyo Grande Redevelopment Agency Adopted a Resolution entitled: "A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY TO THE DISSOLVED ARROYO GRANDE REDEVELOPMENT AGENCY APPROVING THE LAST & FINAL RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR FISCAL YEARS 2023-38 AND APPROVING CERTAIN RELATED ACTIVITIES". 8.d Consideration of Approval of Minutes Approved the minutes of the Regular City Council Meeting of August 23, 2022, as submitted. 8.e Consideration of Adoption of a Resolution Declaring a Continued Local Emergency Related to the Coronavirus (COVID-19) Pandemic Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING A CONTINUED LOCAL EMERGENCY RELATED TO THE CORONAVIRUS (COVID-19) PANDEMIC". 8.f Consideration of Cancellation of November 8, 2022 City Council Meeting Cancelled the regularly scheduled Council meeting of November 8, 2022. 8.g Consideration of Authorizing the City Attorney to Amend the Affordable Housing Agreement for 252 S. Courtland Street Authorized the City Attorney to amend the Agreement allowing the property owner to sell the subject property to an eligible, moderate income household. 8.h Consideration of a Resolution Approving a Grant Agreement from the Office of Traffic Safety for Traffic Records Improvement and Approval of the Purchase of the Crossroads Traffic Collision Reporting and Electronic Citation Systems 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AND AUTHORIZING THE CHIEF OF POLICE TO EXECUTE AN AGREEMENT WITH THE CALIFORNIA OFFICE OF TRAFFIC SAFETY TO ACCEPT GRANT FUNDING FOR TRAFFIC RECORDS IMPROVEMENT PROJECT AND TO APPROPRIATE THE FUNDING FOR THE PROGRAM ACTIVITIES"; 2) Approved a Budget Amendment Request for FY 2022-23 in the amount of $109,000 to account for the OTS grant revenue and the expenditures for the new reporting and citation systems, and 3) Approved the sole source purchase of the Crossroads traffic collision reporting and electronic citation software programs. Page 441 of 512 ATTACHMENT 8 5 8.i Consideration of a Resolution Approving a Grant Agreement with the Office of Traffic Safety for Traffic/DUI Enforcement 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE APPROVING AND AUTHORIZING THE CHIEF OF POLICE TO EXECUTE AN AGREEMENT WITH THE CALIFORNIA OFFICE OF TRAFFIC SAFETY TO ACCEPT GRANT FUNDING FOR TRAFFIC SAFETY PROGRAMS AND TO APPROPRIATE THE FUNDING FOR THE PROGRAM ACTIVITIES"; and 2) Approved a Budget Amendment Request for FY 2022-23 in the amount of $58,000 to account for the additional revenue and expenditures related to the grant. 8.j Consider Adoption of a Resolution Pursuant to Public Contract Code (PCC) Section 20168 and Authorizing Contracting Without a Competitive Solicitation for Bids Pursuant to PCC Section 22050 for FCFA Station 1 Emergency Generator Replacement 1) Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING AN EMERGENCY AND AUTHORIZING THE IMMEDIATE EXPENDITURE OF FUNDS TO REPLACE THE EMERGENCY GENERATOR AT THE FIVE CITIES FIRE AUTHORITY STATION 1"; and 2) Authorized the City Manager, or designee, to execute a contract with a qualified contractor for construction of the project. 8.k Consideration of Acceptance of the 2021 Street Repairs Project, PW 2021-01 1) Accepted the project improvements as constructed by Ferravanti Grading & Paving in accordance with the plans and specifications for the 2021 Street Repairs Project, PW 2021-01; 2) Directed staff to file a Notice of Completion; and 3) Authorized release of retention, thirty-five (35) days after the Notice of Completion has been recorded, if no liens have been filed. 8.l Consideration of Resolution Authorizing Refund of Planning Commission Appeal Fees to the Appellants of Vacation Rental Permits Approved for 263-D Spruce Street and 1170 Linda Drive Adopted a Resolution entitled: "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AUTHORIZING THE REFUND OF APPEAL FEES FOR THE APPEALS OF THE SHORT-TERM RENTALS AT 263-D SPRUCE STREET AND 1170 LINDA DRIVE". 8.m Consideration of a Grant Agreement with Smart Share Housing Solutions for Public Outreach, Education, and Project Management to Facilitate Development of Accessory Dwelling Units in Arroyo Grande Reviewed the proposal from SSHS and authorize the City Manager to execute an Agreement between the City and SSHS for public outreach, education, and project management and demonstration to facilitate the development of ADUs in the City. 9. PUBLIC HEARINGS Mayor/Chair Ray Russom noted that due to conflicts of interest, Council previously drew straws to see who would hear each item. Page 442 of 512 ATTACHMENT 8 6 9.a Discuss and Consider Introduction of Ordinance Amending Title 16 of Arroyo Grande Municipal Code Regarding Accessory Dwelling Units; Development Code Amendment 20-001 and Consideration of a Fee Waiver Program for Certain Accessory Dwelling Units Mayor Ray Russom called for a brief break at 8:54 p.m. The Council reconvened at 9:04 p.m. This item was heard after Item 9.b. Mayor Ray Russom declared a conflict of interest due to owning an ADU and left the meeting. Mayor Pro Tem George presided over the meeting. Planning Manager Perez presented the staff report and recommended that Council introduce the Ordinance amending the regulations for accessory dwelling units and provide feedback about the details of the proposed fee waiver program. Staff responded to questions. Mayor Pro Tem George opened the public hearing. Speaking from the public was Ben Franco. Upon hearing no further public comments, Mayor Pro Tem George closed the public hearing and directed staff to follow-up with the commenter. Moved by Mayor Pro Tem/Vice Chair George Seconded by Council/Board Member Paulding Introduce an Ordinance entitled: "AN ORDINANCE OF THE CITY COUNCIL ADOPTING AMENDMENTS TO TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE (AGMC) REGARDING ACCESSORY DWELLING UNITS; LOCATION- CITYWIDE". City Attorney Carmel read the full title of the Ordinance into the record. AYES (3): Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor/Chair Ray Russom, and Council/Board Member Barneich Passed (3 to 0) 9.b Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code Regarding Short Term Rentals (Vacation Rentals and Homestays); Development Code Amendment 22-002 This item was heard out of order. Mayor Pro Tem George declared a conflict of interest due to owning a short-term rental and left the meeting. Community Development Director Pedrotti introduced the item. Associate Planner Holub presented the item and recommended that the Council introduce an Ordinance amending Title 16 of the AGMC regarding short-term rentals and responded to questions. Mayor Ray Russom opened the public hearing. Speaking from the public were John Hagler, Sharon Valienzi, Ben Franco, Jim Guthrie, Jami Fordyce, Corina Garsa, Francine Errico, Ken Steitz. Upon hearing no further public comments, Mayor Ray Russom closed the public Page 443 of 512 ATTACHMENT 8 7 hearing. Mayor Ray Russom responded to questions from the public. City Attorney Carmel provided clarification regarding references to properties being "grandfathered in." Staff responded to questions from Council. Moved by Mayor/Chair Ray Russom Seconded by Council/Board Member Paulding To modify the Ordinance as follows: a cap of 90 vacation rentals with a 6-month lookback; a short term rental buffer of 500 feet as recommended by the Planning Commission; language for revocation triggers; "unresponsive emergency contact" defined as a contact who does not respond 3 times in a 12-month rolling period and would initiate a revocation hearing; language that 2 citations or arrests in a 12-month rolling period would initiate a revocation hearing; language in outreach letters regarding voluntary relinquishment of permits for existing permit holders; language that TOT must be paid every 6 months; modify language that states the 2- space parking requirement only applies to vacation rentals; the wording "revocation proceeding" be changed to "revocation hearing;" definitions are approved as presented by staff; and to continue the introduction of an Ordinance amending Title 16 of the AGMC regarding short term rentals to a date certain of September 27, 2022. AYES (3): Mayor/Chair Ray Russom, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor Pro Tem/Vice Chair George, and Council/Board Member Barneich Passed (3 to 0) 10. OLD BUSINESS None. 11. NEW BUSINESS 11.a Discussion of Draft Ordinance Addressing Tiny Homes on Wheels This item was heard after item 9.a. Mayor Ray Russom previously declared a conflict of interest due to owning an ADU and left the meeting. Planning Manager Perez presented the report and staff responded to questions from Council. Mayor Pro Tem George invited public comment. Speaking from the public was Joe Pollon. No further public comments were received. Building Official Meyers provided more information regarding tiny home accreditation organizations permitted. Mayor Pro Tem George directed staff to research accreditation options. Moved by Council/Board Member Paulding Seconded by Council/Board Member Storton Approve staff's recommendation with the modification to add language to paragraph B3 to state "in addition to the RVIA any other HCD approved association", and to ban roof top decks. Page 444 of 512 ATTACHMENT 8 8 AYES (3): Mayor Pro Tem/Vice Chair George, Council/Board Member Paulding, and Council/Board Member Storton ABSENT (2): Mayor/Chair Ray Russom, and Council/Board Member Barneich Passed (3 to 0) 12. COUNCIL COMMUNICATIONS This item was heard out of order. Mayor/Chair Ray Russom stated that she will be unable to attend the Mayor's meeting and asked if any other Council Member would be available to attend. Council members Storton, Paulding and George stated they would not be able to attend. 13. CLOSED SESSION None. 14. ADJOURNMENT There being no further business to come before the City Council/Board of Directors, Mayor Pro Tem George adjourned the meeting at 9:47 p.m. _________________________ Caren Ray Russom, Mayor/Chair _________________________ Jessica Matson, City Clerk/Secretary Page 445 of 512 Item 9.b. MEMORANDUM TO: City Council FROM: Brian Pedrotti, Community Development Director BY: Patrick Holub, Associate Planner SUBJECT: Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide DATE: September 27, 2022 SUMMARY OF ACTION: Introduction of the proposed Ordinance to establish a permanent parklet program. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: Costs to support a permanent parklet program include in-house and/or contractual services for manual street sweeping, barrier adjustments, inspection and maintenance, and general program administration. Currently, there are a total of fourteen existing parking spaces displaced by existing temporary parklets. It is recommended that permanent parklet applicants fully cover the costs of the permanent parklets. These costs are listed under “Analysis of Issues,” and may be offset through permitting fees, rental costs associated with the loss of City property, and rental fees for physical barriers. RECOMMENDATION: Introduce an Ordinance establishing a permanent parklet program. BACKGROUND: The COVID-19 pandemic that began in 2020 created a public health crisis and unprecedented economic impacts throughout the country, State, and at the local level. In the City of Arroyo Grande (City), local businesses have been economically impacted by this public health emergency, especially restaurants, hotels, and retail establishments. This created both a significant challenge for the City - with an urgent need to support both public health and economic recovery of local businesses - as well as a unique opportunity to re-imagine how the City’s public right-of-way can be utilized to improve long-term community vibrancy and economic vitality. In response to the initial COVID -19 reopening process, the City adopted Resolution 5007 on June 23, 2020, authorizing the Community Development Director to waive application fees for encroachment permits and Minor Use Page 446 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 2 Permits/Temporary Use Permits for restaurants that were seeking additional outdoor dining space (Attachment 2). Starting in July of 2020, the City facilitated the installation of five temporary parklets for eight individual restaurant businesses in the Village. All of these parklets remain in use today. Eight other businesses, both in the Village and in other City commercial areas, took advantage of the opportunity to expand outdoor dining within private parking lots, including restaurants that utilized temporary barricades (concrete K-rail) provided by the City and installed at the City’s expense, in order to remain in business outdoors. All of the temporary barriers used to provide outdoor dining space in parking lots outside of the Village area have been removed. The only temporary street closure that remains in effect is the closure of Short Street between Branch Street and Olohan Alley. Council authorized the continued temporary closure of Short Street at its meeting on May 10, 2022 to provide time to evaluate options for a permanent closure and redevelopment of the area as a pedestrian plaza and park. Existing parklets within the Village displace a total of fourteen (14) parking spaces, which include partial spaces that can only support smaller vehicles. There are a total of sixty- one (61) on-street parking spaces along East and West Branch Streets in the Village. The parking spaces lost to parklets currently account for approximately twenty -three percent (23%) of the on-street parking in the Village. Attachment 3 includes a map of the locations and photos of the existing parklets. In late 2021 the City published a survey requesting feedback from the community regarding the existing parklets. In total, more than 600 comments were received, with the vast majority of responses indicating support for parklets. Respondents also indicated that if an outdoor dining establishment included a parklet, they were more likely to visit such an establishment by a margin of 68% to 26%, with about 6% unsure. On November 23, 2021, the City Council held a study session on the status of the temporary parklet program and discussed the potential for a permanent parklet program. Council expressed concerns with various aspects of parklets, including the number, their proximity to each other, the safety of users, the amount of staff time dedicated to a permanent program, their consistency with the historic downtown, design of the parklets, and costs. Council directed staff to return with the framework of a program that evaluated and provided recommendations on the following issues: 1. Associated costs for application, rent, encroachment, and in-lieu parking; 2. Safety considerations; 3. Suggested design standards; 4. A cap on the number of parklets; Page 447 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 3 5. A proposed proximity between parklets; 6. Eligibility; and 7. Application and notification procedures On April 12, 2022, the City Council conducted an additional study session to consider a proposed permanent parklet program. During the study session, the City Council provided comments regarding each point and asked that the Architectural Review Committee (ARC) help develop the objective design standards for the parklets. On August 1, 2022, the ARC reviewed proposed objective design standards developed by staff and made a number of recommendations, which were incorporated into the proposed Ordinance. On September 6, 2022, a proposed Ordinance implementing the permanent parklet program was presented to the Planning Commission (PC), which provided further recommendations and forwarded it to the City Council for introduction and adoption. The recommendations from the Planning Commission included: 1. Exclude the five (5) space buffer required between parklets and remove the maximum of fifteen (15) parking spaces occupied by parklets. 2. Keep the two (2) space maximum for each individual parklet. Minutes for each of these meetings are included as Attachments 4-7 to the staff report. ANALYSIS OF ISSUES: The proposed Ordinance is necessary to implement the permanent parklet program previously discussed by the City Council. In particular, the Ordinance implements performance standards, including parklet location, density, ADA compliance and design standards. These regulations are intended to ensure that parklets located in the City conform to the existing character of the area in which they are located and do not create an adverse impact on adjacent properties. Safety concerns are at the forefront of the consideration of a permanent parklet program. The program will utilize a consistent looking physical security barrier. The dimensions of the security barriers should all be uniform throughout the City. Each of the security barriers will be purchased and owned by the City to ensure a uniform design, and leased to future applicants of permanent parklets. Furthermore, staff recommends that no visual obstructions be placed on or above these barriers to ensur e a consistent appearance as well as to facilitate traffic and pedestrian safety by removing visual distractions and obstructions. Each of these recommendations is incorporated into the proposed Ordinance to implement the parklet program. In addition to the size and location of the barriers, materials chosen for the interior of the parklets (e.g. decking, shade structures, etc.) will be consistent throughout the parklet Page 448 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 4 program and consistent with the character of the Village. The Village Design Guidelines specify that “all new projects shall use materials that fit within the character of the Village. Using similar materials or replicating these materials on all projects and restorations will extend the existing character extended throughout the Village” (Attachment 8). Parklet Location and Density Performance standards for parklet location have been developed through meetings with the City Council, ARC, and PC. The standards in the proposed Ordinance include requirements that parklets be located only within existing on-street parking spaces, do not obstruct pedestrian or vehicular traffic, and be located a minimum distance from street intersections and driveways to facilitate safety for all roadway users. Furthermore, parklets are prohibited in no parking and disabled parking areas, as well as any parking zone that is time-limited to less than thirty (30) minutes. Lastly, parklets shall be located in a manner that does not prevent access to any utility equipment, such as fire hydrants, or other public infrastructure. Wherever possible, the parklet shall not extend beyond the building frontage of the business utilizing the parklet. The current placement of the parklets allows for adequate on-street parking between each of the parklets, which leaves available parking spaces for customers who wish to park on Branch Street or for those who are patronizing businesses that do not have a parklet. The proposed Ordinance includes standards that address the density of parklets and ensure that there remains space between them for continued off -street parking. Per the City Council’s direction, there is an overall cap of 25% of available on -street (Branch Street) parking for parklets, which equates to fifteen (15) parking spaces, to ensure availability of parking for all Village users. Council also directed staff to include a minimum of five (5) parking spaces, or ninety (90) feet total, between parklets, as measured on the same side of the street. The PC, at its meeting on September 6, 2022 hearing, recommended eliminating both the overall cap on parking spaces for parklets and the minimum distance between parklets. Since the PC recommendations on density are significant deviations from the City Council’s prior direction, they have been included in an alternate PC-recommended Ordinance presented in Attachment 9. Parklet Design and Maintenance Objective design standards have been developed to regulate design of the permanent parklets. Included in the proposed Ordinance are regulations that have been developed from meetings with the City Council, ARC, and PC. The proposed regulations include provisions that parklets not occupy more than two parking spaces to promote equity among businesses. Required safety barriers may not exceed forty-two inches (42”) in height and at least eight feet (8’) of vertical clearance to ensure accessibility and functionality of the parklet for users. Architectural elements associated with the parklet shall not exceed the height of the first floor of the adjacent building so views of Village Page 449 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 5 buildings are maintained to the greatest extent possible so as to not diminish the feel of the historic district. Parklets shall be located and designed to facilitate ADA access and compliance, which includes a requirement that parklets incorporate a flush transition between the deck of the parklet and the sidewalk. Reflective delineators are required to be provided to signify the parklet envelope and increase its visibility for motorists. Parklets must be designed to comply with the Village Design Guidelines with regards to materials and colors to be consistent with the existing built environment. Trash storage areas must be screened from the public right of way, with trash receptacles emptied regularly by the associated business owner, and kept in a generally neat and sanitary order to ensure cleanliness. Trash around and inside each parklet will be monitored and picked up each day by the business owner. Since the use of the sidewalk area will be more intensely used as part of the parklet system, including the transfer of food and drinks to the parklet dining area, the associated business owner will steam clean the frontage section at least once a year and on an as needed basis. The City will observe the conditions of each parklet throughout the year, and if staining and/or a general uncleanliness is found, a request for the business to perform steam cleaning will be made. However, self-monitoring of cleanliness and sidewalk conditions by busines s owners is preferred. Lastly, the gutter/drainage way at each parklet will be kept open and free of trash and other debris to allow for normal storm water drainage to occur unimpeded. Definition The proposed Ordinance states that permanent parklets are limited strictly to food service uses. The economic benefits of parklets noted in the study session and survey were generally identified as creating a vibrant and pedestrian-friendly atmosphere, making Branch Street more active and inviting. The proposed Ordinance includes a definition of a parklet as follows: “Parklet” means a small seating area created as a public amenity in a former roadside parking space utilized by a food service business for outdoor dining”. The term “food service business” is intended to include such businesses as restaurants, coffee houses, and wine tasting rooms. The proposed Ordinance does not include non- dining establishments in this definition, which would potentially create a cluttered appearance and the proliferation of obstructions in the sidewalk area, would be inconsistent with the intent of the Village Historic Overlay District, and would not achieve the benefits identified by the Council and the public. Application and Approval The proposed Ordinance includes a requirement that applicants for permanent parklets obtain a Minor Use Permit – Plot Plan Review, which is a permit process consistent with Page 450 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 6 other similar uses in the Municipal Code, to ensure that the parklet’s placement will not have unintended consequences on neighboring businesses and property owners and will not contribute to a loss of parking that could have negative effects on the rest of the Village. There is a one-time fee of $756 to apply for a Plot Plan Review and this permit type is an administrative approval reviewed by the Community Development Director. In addition to the need for the approval of a Minor Use Permit, parklet owners will also need to obtain an encroachment permit to ensure liability within the parklet is transferred from the City to the business owner. City staff developed a new encroachment permit category (Encroachment Permit – Small Size) that will be applied in situations that do not require as much staff time and resources for processing as Standard projects but require more resources than Minor projects, such as installation of concrete sidewalk panels, drive approaches, and replacement of existing curb and gutters at single family residences. This fee for the Small Size Encroachment Permit totals $180 per month and became effective as of June 13, 2022. These costs would account for the staff time required to inspect the parklets and ensure that they are not creating life safety concerns, as well as the administrative time required to process each application. The City will require that the business owners provide the City with a Certificate of Liability that covers the City in the event of any damage to City property or injury occurring within the parklet area. The liability coverage shall be in an amount no less than one million dolla rs ($1,000,000) and include a CG 2012 (or approved equivalent) additional insured endorsement attached to it. As a comparison, the cost of a standard encroachment permit is $718 for each month that the encroachment occurs. Alternatively, the City offers a minor encroachment permit, which costs $59 monthly. This minor encroachment permit type is generally reserved for items such as storage containers or dumpsters parked temporarily within the right of way. These minor permits are typically used in situations where little to no staff time is required to oversee the encroachment. One additional consideration with the approval process is to recognize the previous investment and establishment of temporary parklets by some business owners. The proposed Ordinance provides for a grace period of six months from the effective date of the proposed Ordinance, if approved, for existing temporary parklets to obtain approval of a permanent parklet and/or remove the temporary parklet. The proposed Ordinance also includes a provision that these same businesses will receive initial permit priority, with the assumption that the approved Ordinance will have a cap on the number of on - street parking spaces allowed to be removed. Page 451 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 7 Notification and Appeal Minor Use Permits require notification of administrative approval to the Planning Commission per AGMC 16.12.155. As part of this notification process, any decision made by the Community Development Director is appealable to the Planning Commission by any member of the public. Additionally, the Planning Commission may also choose to appeal such a decision with a simple consensus among them. Decisions of the Planning Commission are then appealable to the City Council pursuant to AGMC 16.12.150. Expiration/Termination The economic and social benefits of a permanent parklet program such as increased downtown vibrancy and activity, which were expressed in the community survey conducted in 2021, rely on the continuous use and maintenance of parklets. Further, having underutilized structures in the Village could have the potential to create a cluttered atmosphere. To ensure that parklet structures are not sitting vacant for long periods of time, the approval of parklets run with the approved business operator, with the use permit terminating when such business operator vacates the premises adjoining the parklet. In addition, in the Municipal Code includes revocation procedures for Minor Use Permits in the case of non-compliance with performance standards or lack of use of the parklet. These expiration provisions are included in the proposed Ordinance provided in Attachments 1 and 9. Costs and Safety Considerations Based on City Council direction and public input, parklet applicants will fully cover the costs of the permanent parklets, which utilize public space to support private business operations. Costs involved include: permitting fees; rental costs associated with the loss of City property; and the rental costs associated with the physical barriers situated between the parklet and the roadway that ensure safety of all parklet users. In determining the rental costs to the City for the loss of on -street parking spaces, staff reviewed information created by nearby jurisdictions. The Cities of Paso Robles and San Luis Obispo both have completed research for the purpose of determining rental costs for the lost parking spaces from parklets. The City of Paso Robles indicated in a September 7, 2021 staff report that each of its downtown park ing spaces generated $1,500-$1,600 in revenue based upon the total tax generation of the downtown businesses divided by the number of lost parking spaces. The City of San Luis Obispo , in a fiscal analysis as part of their parklet ordinance hearings on July 5th and July 19th, identified an expected a cost of $6,760, or $42.25 per square foot annually. Of this figure, $4,000 was identified as the expected lost revenue from San Luis Obispo’s paid parking areas and the remaining expected cost included costs for manual street sweeping; inspection and maintenance; and general program administration. Although different conditions exist Page 452 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 8 within Arroyo Grande, City staff believes that rental costs for the use of parking spaces in the Village should be relatively consistent with these figures. As an alternative means to calculate the rental cost per parking space lost, the City’s onetime Downtown Parking In-Lieu Fee could be referenced. Established by Resolution 3994, the City’s current parking in-lieu fee in the Village is $24,000 per space and is a cost paid by applicants unable to provide the required parking for their proposed use of a property. With no other reference point for parking revenue such as parking meter collection, staff has proposed a rate of five percent (5%) annually as commensurate with the tax generation cited in other nearby cities, resulting in a per-space cost of $1,200 per year. Based on the information collected and described above, staff has identified a potential rental fee amount in Table 1 below of $100 per month ($1,200/year). This amount was selected for discussion purposes and represents the monthly cost for the City to collect five percent (5%) of the parking in-lieu fee for each space annually. The safety of parklet users and vehicles on Branch Street (there are portions of East and West Branch Street in the Village) is a primary concern for City staff, and was highlighted in the meetings with the City Council, ARC, and PC. In contrast with other local cities streets that contain parklets, Branch Street was designated as State Highway 227 until 2008 and remains a truck route with a fairly narrow travel way with heavy truck and agricultural equipment traffic. The narrow road way width places patrons in close proximity to traffic. Public Safety and Public Works staff have seen traffic incidents with vehicles hitting the k-rail barriers, along with evidence of tire marks at two locations that are a result of side swipes. Considering these factors, if a permanent parklet program is established, proper barriers and their location/design will be critical to increase the safety of outdoor diners, moving vehicles, bicycles, and pedestrians. City staff have conducted a preliminary investigation regarding permanent safety barriers that could replace the existing rented k-rails that provide a vehicle barrier between the travel lanes and the parklet. One company, Bertleson Precast, manufactures a concrete safety barrier that measures ninety-six inches (96”) in length, twenty-four inches (24”) wide and thirty-five inches (35”) in height. In order to replace the existing rented k-rails, staff has determined the need to purchase approximately twenty (20) or thirty (30) of these barriers. The manufacturer indicated a cost of approximately three thousand dollars ($3,000) per barrier for this quantity of barriers. Staff recommends that the City purchase the necessary safety barriers dedicated for the entire permanent parklet program. This would amount to a total initial cost to the City of at least $60,000-$90,000 to purchase the barriers. Additional costs would be incurred for transportation and installation of the barriers, which have not been calculated by staff at this time. Page 453 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 9 With an average parklet encompassing two parking spaces, a total of six (6) barriers would be needed to provide adequate protection for patrons of the parklet, amounting to at least $18,000 per parklet. Because of the large up -front cost associated with purchasing the barriers, and because the City would own and retain the barriers following purchase, staff would recommend renting the barriers to parklet owners in an amount that would enable the City to recoup its costs over a reasonable period of time. The per-barrier rental fee, if set at an annual percentage rate of ten percent (10%) of the overall cost to purchase, would be three hundred dollars ($300) per barrier per year. This would bring the total annual cost to rent the necessary number of safety barriers for an average parklet to one thousand eight hundred dollars ($1,800) per year. While there are other solutions to ensure the safety of the public, these barriers provide a more decorative appearance than the existing k-rails and can be customized if desired while also providing as much safety as possible to the parklet patrons. Table 1 shows the estimated costs associated with operation of a parklet within the City’s right of way. Table 1 – Estimated Costs ITEM COST FREQUENCY ANNUAL TOTAL Annual Cost Encroachment Permit $180 Per Month $2,160 Parking Space Rent* $100 Per Month (Per Space) $2,400 Safety Barrier Rent* $25 Per Month (Per Barrier) $1,800 Total – Monthly Costs $530 Total – Annual Costs $6,360 One-Time Costs Minor Use Permit – Plot Plan Review $735 One-Time $735 Total – One-Time Costs $735 *Annual costs are reflective of a two-space permanent parklet. All of the fees proposed for the permanent parklet program identified above have been included in a Resolution amending the fee schedule provided for review in Attachment 10. The Resolution is proposed to be adopted with the Ordinance at a future City Council Meeting. The proposed Ordinance includes language requiring applicants to pay all applicable fees for permanent parklets as shown in the City’s fee schedule. Page 454 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 10 Next Steps If the City Council introduces the proposed Ordinance, it will be considered for adoption by the City Council at the next meeting. If adopted, the Ordinance will take effect thirty (30) days from the date of adoption. Additionally, the proposed Resolution establishing the fee schedule associated with the parklet program will be considered for with the Ordinance. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1. Introduce the attached Ordinance approving Development Code Amendment 22- 003; 2. Modify as appropriate and introduce the attached Ordinance approving Development Code Amendment 22-003; 3. Do not introduce the attached Ordinance, and provide direction to staff on specific revisions to the Ordinance; or 4. Provide other direction to staff. ADVANTAGES: Introduction of the proposed Ordinance will allow the City to create a permanent parklet program to ensure that parklets located in the Village are safe and conform to the existing character of the area in which they are located and do not create an adverse impact on adjacent properties. DISADVANTAGES: If the proposed Ordinance is adopted, businesses with existing temporary parklets will need to come into compliance with the adopted Ordinance or remove the temporary parklets. The proposed Ordinance would result in a permanent loss of some on -street parking on Branch Street in the Village. ENVIRONMENTAL REVIEW: The proposed Ordinance for a permanent parklet program is categorically exempt under CEQA Guidelines Section 15301 (Existing Facilities) because the actions are limited to permitting, leasing, and minor alteration of existing public facilities . PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Page 455 of 512 Item 9.b. City Council Discussion and Consideration of Introduction of Ordinance Amending Title 16 of the Arroyo Grande Municipal Code (AGMC) Regarding a Permanent Parklet Program; Development Code Amendment 22-003; Location – Citywide September 27, 2022 Page 11 Attachments: 1. Proposed Ordinance 2. Resolution 5007 3. Location Map and Photos 4. Minutes and staff report from the November 23, 2021 City Council Study Session 5. Minutes and staff report from the April 12, 2022 City Council meeting 6. Minutes and staff report from the August 1, 2022 Architectural Review Committee 7. Minutes and staff report from the September 6, 2022 Planning Commission Meeting 8. Village Design Guidelines 9. Planning Commission-Recommended Alternative Proposed Ordinance 10. Draft Resolution to Amend Fee Schedule Page 456 of 512 ATTACHMENT 1 ORDINANCE NO. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE REGARDING THE ESTABLISHMENT OF A PERMANENT PARKLET PROGRAM WHEREAS, the City of Arroyo Grande (“City”) currently does not allow the placement of permanent parklets within the right of way; and WHEREAS, the purpose of these regulations is to ensure that parklets within the right of way conform to the existing character of the area in which they are located and do not create an adverse impact on adjacent properties; and WHEREAS, the Planning Commission finds that, unless properly regulated, parklets can result in similar adverse impacts to adjacent properties; and WHEREAS, the Planning Commission has considered the proposed Ordinance approving Development Code Amendment 22-003 at a duly noticed public hearing on September 6, 2022; and WHEREAS, it is the purpose of the proposed Ordinance to protect the public health, safety, and welfare of residents within the City by establishing regulations for a permanent parklet program; and NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Arroyo Grande as follows: SECTION 1: The above recitals and findings are true and correct and incorporated herein by this reference. SECTION 2: Arroyo Grande Municipal Code Section 16.52.250 is hereby added as follows: SECTION 16.52.250 – PARKLETS A. Purpose and Intent. The purpose and intent of these regulations is to ensure that parklets located in the City conform to the existing character of the area in which they are located and do not create an adverse impact on adjacent properties. B. Application and Approval. 1. Operators of parklets within the right of way are required to obtain a Minor Use Permit – Plot Plan Review pursuant to AGMC 16.16.080, and an Encroachment Permit pursuant to AGMC Section 13.26. 2. Operators of parklets shall pay a parking space rental fee of 5% of the parking in-lieu fee for each space annually. 3. Operators of parklets shall pay a rental fee for City-owned safety barriers. Page 457 of 512 RESOLUTION NO. PAGE 2 4. Upon vacation by a parklet operator of the premises adjoining the parklet, the Minor Use Permit – Plot Plan will terminate. 5. Existing operators of temporary parklets shall have 90 days from the date of ordinance adoption (______) to submit an application for a permanent parklet and removal of an existing temporary parklet. All temporary parklets shall be removed within six months of the ordinance adoption date of ______. C. Performance Standards and Conditions. Location 1. A parklet shall only be located in designated on-street parking areas. 2. A parklet shall not block sight distance at intersections or driveways. Accordingly, a parklet shall not be located less than twenty-five feet (25’) from a roadway intersection, adjacent driveway, or other points of off-street access which require line of sight standards as required by the City’s Engineering Standards. The final location of a parklet will vary based on the proposed parklet design, and shall be subject to review and approval by the Community Development Director. 3. A parklet shall not be located closer than five (5) parking spaces or ninety (90) feet from any other parklet. 4. Parklets are prohibited in disabled parking zones, parking areas of thirty minutes or less, and no-parking zones. 5. A parklet may not cover or impede access to any utility equipment, utility pole, fire hydrant, parking permit kiosk, or utility access such as manhole covers, drainage inlets, stormwater drainage flow lines and equipment shelters, subject to review by the City Public Works Director and Fire Chief. 6. The parklet shall not extend beyond the building frontage of the business utilizing the parklet without written consent from the adjacent business. Parklet Design 7. Parklets shall consist of no more than two adjoining parking spaces, or forty- feet (40’) in length. When a parklet is shared by two or more businesses, the parklet length may be extended up to eighty (80) feet in length and no more than four adjoining parking spaces. 8. A parklet’s walls or railing shall not have a continuous height that exceeds forty- two inches (42”) and shall not block views in or out of the parklet. Columns or other vertical framing for overhead elements are permitted. All elements of a parklet shall have a maximum height limit no higher than the first floor of the adjacent building. All parklets shall maintain a vertical walkway clearance height of at least eight feet (8’). 9. The depth (dimension measured perpendicular to curb) of a parklet shall be no less than the minimum dimension required to meet ADA accessibility requirements. Portions of the required parklet depth may be located within an existing sidewalk area as long as the sidewalk encroachment does not reduce the pedestrian path of travel to a width of less than four and a half feet (4.5’) in the public right of way. Page 458 of 512 RESOLUTION NO. PAGE 3 10. A parklet shall include an element that ensures public safety by providing a barrier or fortified railing between moving vehicles and parklet users. These barriers shall either be well articulated or allow for plants or vegetation for screening. 11. Parklets shall have a flush transition at the sidewalk and curb to permit easy access and avoid tripping hazards. 12. A parklet shall comply with applicable Americans with Disabilities Act (ADA) accessibility standards. Compliance with ADA standards is required with respect to design elements of the parklet, as well as for adjacent areas that may be impacted by the parklet. Parklets shall use a slip-resistant flooring material to minimize hazards and shall be accessible to wheel-chair users. 13. The four corners of a parklet shall have a reflective element or other clearly visible design feature, such as a soft-hit post, bollard, or raised pavement marker, to illuminate the parklet at night and signify the parklet envelope. 14. Parklets shall be consistent with the Village Design Guidelines 15. The primary materials shall be stone, brick, wood, decorative concrete or composite wood. Wood materials such as lattice and T1-11 plywood siding, are prohibited. 16. Color schemes shall consist of one primary color and one secondary color unless natural wood is used. 17. Areas for the storage of trash, recycling, and green waste receptacles shall not be visible from the public right of way and all waste receptacles shall be emptied and maintained by the applicant in a neat and sanitary order. SECTION 3: Arroyo Grande Municipal Code Section 16.04.070 is hereby amended as follows: 16.04.070 Definitions “Parklet” means a small seating area created as a public amenity in a former roadside parking space utilized by a food service business for outdoor dining. SECTION 4: If any section, subsection, subdivision, paragraph, sentence, or clause of this Ordinance or any part thereof is for any reason held to be unlawful, such decision shall not affect the validity of the remaining portion of this Ordinance or any part thereof . The City Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, or clause thereof, irrespective of the fact that any one or more section, subsection, subdivision, paragraph, sentence, or clause be d eclared unconstitutional. SECTION 5: Upon adoption of this Ordinance, the City Clerk shall file a Notice of Exemption pursuant to 14 CCR § 15062. SECTION 6: A summary of this Ordinance shall be published in a newspaper published and circulated in the City of Arroyo Grande at least five (5) days prior to the City Council meeting at which the proposed Ordinance is to be adopted. A certified copy of the full text of the proposed Ordinance shall be posted in the office of the City Clerk. Within Page 459 of 512 RESOLUTION NO. PAGE 4 fifteen (15) days after adoption of the Ordinance, the summary with the names of those City Council Members voting for and against the Ordinance shall be published again, and the City Clerk shall post a certified copy of the full text of such adopted Ordinance. SECTION 7: This Ordinance shall take effect thirty (30) days from the date of adoption. On motion of Council Member , seconded by Council Member , and on the following roll call vote to wit: AYES: NOES: ABSENT: The foregoing Ordinance was adopted this 27th day of September 2022. Page 460 of 512 RESOLUTION NO. PAGE 5 ___________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: ___________________________________ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: ___________________________________ WHITNEY McDONALD, CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 461 of 512 RESOLUTION NO. 5007 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AUTHORIZING THE COMMUNITY DEVELOPMENT DIRECTOR TO WAIVE APPLICATION FEES FOR ENCROACHMENT PERMITS AND MINOR USE PERMITS-TEMPORARY USE PERMITS SUBMITTED BY RESTAURANTS SEEKING ADDITIONAL OUTDOOR DINING SPACE DURING THE COVID-19 REOPENING PROCESS WHEREAS, local restaurants have suffered during the shelter-at-home orders issued by the State and County of San Luis Obispo in response to the COVID-19 pandemic, and, although the State has allowed restaurants to reopen, they are required to ensure adequate physical distancing or protective measures installed between tables, resulting in many restaurants being forced to significantly reduce the number of tables and seats available in their existing spaces; and WHEREAS, restaurants seeking additional outdoor dining area not already included in the restaurant's existing land use entitlement are required to obtain a Minor Use Permit- Temporary Use Permit in order to comply with the City of Arroyo Grande's Development Code, and any proposed outdoor dining use of City right of way or other City-owned property will also require an encroachment permit; and WHEREAS, the current application fee for an encroachment permit is $57 and the application fee for a Minor Use Permit-Temporary Use Permit is $294; and WHEREAS, the City does not have an adopted procedure for requests for waivers of application fees in this situation; and WHEREAS, the City wishes to support local restaurants in their efforts to recover and reopen following the COVID-19 shelter-in-place orders and to comply with the State and local physical distancing and other operational limitations by facilitating additional outdoor dining space where otherwise appropriate under existing laws and regulations. NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Arroyo Grande as follows: 1. The Community Development Director is authorized to waive application fees for encroachment permits and Minor Use Permits-Temporary Use Permits for restaurants seeking additional outdoor dining space during the COVID-10 reopening process. 2. The City Clerk shall certify to the adoption of this Resolution and shall cause a certified copy to be filed in the Office of the City Clerk. On motion of Council Member Paulding, seconded by Council Member Storton, and by the following roll call vote, to wit: AYES: Council Members Paulding, Storton, George, Barneich, and Mayor Ray Russom NOES: None ABSENT: None The foregoing Resolution was approved this 23rd day of June, 2020. ATTACHMENT 2 Page 462 of 512 RESOLUTION NO.50O7 PAGE 2 rr i_ KEITH STORTON, MAYOR PRO TEM ATTEST: i o4eo/L KELLY ET RE, CITY CLERK APPROVED AS TO CONTENT: aede BILL ROBESfrelfi- etINI CTING CITY MANAGER APPROVED AS TO FORM: 4,7 TIMOTHY J. CARMEL, CITY ATTORNEY Page 463 of 512 OFFICIAL CERTIFICATION I, KELLY WETMORE, City Clerk of the City of Arroyo Grande, County of San Luis Obispo, State of California, do hereby certify under penalty of perjury, that the attached Resolution No. 5007 was passed and adopted at a regular meeting of the City Council of the City of Arroyo Grande on the 23rd day of June, 2020. WITNESS my hand and the Seal of the City of Arroyo Grande affixed this 25th day of June, 2020. KELLY W M RE, CITY CLERK Page 464 of 512 ATTACHMENT 3Page 465 of 512 Parklet Photos Rooster Creek Café Andreini Page 466 of 512 Villa Cantina Humdinger/Village Café/Doc Bernstein Page 467 of 512 Mule Bakery Page 468 of 512 Attachment 4 – Staff Report and Minutes from the November 23, 2021 City Council study session. Parklets Study Session Staff Report Minutes from the November 23, 2022 City Council Meeting Page 469 of 512 Attachment 5 – Staff Report and Minutes from the April 12, 2022 City Council meeting. April 12, 2022 City Council Staff Report Minutes from the April 12, 2022 City Council Meeting Page 470 of 512 Attachment 6 – Staff Report and Minutes from the August 1, 2022 Architectural Review Committee meeting. August 1, 2022 Architectural Review Committee staff report Minutes from the August 1, 2022 Architectural Review Committee meeting Page 471 of 512 Attachment 7 – Staff Report and Minutes from the September 6, 2022 Planning Commission meeting. September 6, 2022 Planning Commission staff report Minutes from the September 6, 2022 Planning Commission meeting can be found on the following pages. Page 472 of 512 1 ACTION MINUTES MEETING OF THE PLANNING COMMISSION September 6, 2022, 6:00 p.m. Hybrid City Council Chamber/Virtual Zoom Meeting 215 East Branch Street, Arroyo Grande Commission Members Present: Chair Glenn Martin, Vice Chair Jamie Maraviglia, Commissioner Jim Guthrie, Kevin Buchanan Commission Members Absent: Commissioner Frank Schiro Staff Present: Associate Planner Andrew Perez, Assistant Planner Patrick Holub Given the recent increase in COVID-19 cases in San Luis Obispo County, and in compliance with Assembly Bill (AB) 361, which allows for a deviation of teleconference rules required by the Ralph M. Brown Act, this meeting was held by teleconference. _____________________________________________________________________ 1. CALL TO ORDER Chair Martin called the Planning Commission meeting to order at 6:00pm. 2. ROLL CALL Commissioner Schiro was absent. 3. FLAG SALUTE Commissioner Guthrie 4. AGENDA REVIEW None. 5. COMMUNITY COMMENTS AND SUGGESTIONS None. 6. WRITTEN COMMUNICATIONS The Commission received one supplemental memorandum regarding item 10. 7. CONSENT AGENDA 7.a Approval of Minutes Page 473 of 512 2 (HOLUB) Moved by Chair Martin Seconded by Vice Chair Maraviglia Approve the Minutes of the August 16, 2022 Regular Meeting. Passed 8. PUBLIC HEARINGS 8.a Consideration of Development Code Amendment 22-003 Regarding a Permanent Parklet Program (HOLUB) Associate Planner Holub presented the staff report and responded to Commissioner questions regarding existing parklets, liability insurance, parking limits and other forms of outdoor dining. Chair Martin opened the public hearing. Andrea Scott, 391 Garden Street, asked a question regarding Short Street that was answered by Commissioner Guthrie. Hearing no further public comment, Chair Martin closed the public hearing. Commissioner Buchanan moved and Vice Chair Maraviglia seconded a motion to adopt a Resolution recommending the City Council adopt an Ordinance approving a permanent parklet program with the following changes: 1) Exclude the five (5) space buffer between parklets and 2) Remove the cap on the maximum number of spaces encumbered by parklets. Moved by Kevin Buchanan Seconded by Vice Chair Maraviglia Passed 9. NON-PUBLIC HEARING ITEMS None. 10. NOTICE OF ADMINISTRATIVE ITEMS SINCE AUGUST 16, 2022 Received. Chair Martin opened the public comment period. Andrea Scott, 391 Garden Street, spoke about concerns related to a short term rental on Garden Street. Hearing no further public comment, Chair Martin closed the public comment period. 11. COMMISSION COMMUNICATIONS Commissioner Guthrie asked a question about the public comment process. Page 474 of 512 3 Chair Martin mentioned that he will be attending the American Planning Association conference in Anaheim in October. 12. STAFF COMMUNICATIONS None. 13. ADJOURNMENT The Meeting adjourned at 7:24pm. _________________________ Glen Martin, Chair _________________________ Patrick Holub, Associate Planner Page 475 of 512 C ITY OF A RROYO G RANDE GUIDELINES & S TANDARDS FOR H ISTORIC D ISTRICTS CONSTRUCTION MATERIALS This section provides examples of the most commonly found building materials used in the Village area of Arroyo Grande. There are also examples of construction materials under the Village Core and the Residential sections specific to those areas. All new projects shall use materials that fit within the character of the Village (see following examples). Using similar materials or replicating these materials on all projects and restorations will extend the existing character extended throughout the Village. All restorations shall use materials that match or complement the original structure facilitating compatibility and preservation of its character. WEATHERBOARD OR CLAPBOARD WOOD SIDING Most of the original housing and a few of the commercial buildings used horizontal wood siding or vertical board and batten for the exterior walls and trim of the buildings. Wood siding gives the buildings a sense of historic character, adding detail and texture. CEMENT PLASTER Cement plaster (including stucco) is not as common as wood or brick, however some of the commercial and residential buildings within the Village have plaster exteriors. Cement plaster buildings require detailing that gives them a historic “Village” feel. Buildings with plain plaster walls and no ornamentation are not appropriate for The Village. YELLOW INDIGENOUS SANDSTONE This type of stone is used on the old I.O.O.F. Hall on Bridge Street and the Old Brisco Hotel on East Branch Street. It is a golden stone that is shaped in large irregular chunks. The color of this natural stone adds a warm variety and individuality to the area. 20 ATTACHMENT 8 Page 476 of 512 C ITY OF A RROYO G RANDE GUIDELINES & S TANDARDS FOR H ISTORIC D ISTRICTS BRICK AND STONE BLOCK Brick and stone blocks are most common on commercial buildings in the Village. Brick is an old construction material that was used in the late 1800s and early 1900s when the bulk of the historic commercial buildings in Arroyo Grande Village were built. The use of exposed plain concrete block is not permitted in the Historic Village Core District. WINDOW SASHES AND DOOR FRAMES Doors should be made of wood or a material that resembles an older style wooden door. For commercial areas, large industrial style glass doors and windows with metal frames are not appropriate. Doors with wood trim and windows with wood framing should be used. Aluminum and other frames that have a modern metal look are not appropriate for the Village. 21 Page 477 of 512 C ITY OF A RROYO G RANDE GUIDELINES & S TANDARDS FOR H ISTORIC D ISTRICTS VILLAGE CORE DOWNTOWN (VCD) This section of the Guidelines and Standards applies to all parcels in the Village Core Downtown area and may also be applicable within Community Facilities (including Public Facilities and Parks), and Mixed Use districts as shown on the Design Overlay District Map. An objective of the Village Core Downtown area is to enhance and maintain a compact, active street frontage with commercial uses that attract pedestrians. A visual continuity should be maintained through site design and compatibility of scale and materials. MIXED USES WITHIN THE DISTRICT There are properties within the Village Core, Mixed Use and Community Facilities overlay districts that have residential architectural styles, and are currently being used as stores, shops, residences, or offices. In order to preserve and enhance mixed use, the character of any new building or renovation shall be consistent with the surrounding area. EXISTING CHARACTER Many of the Downtown district historic commercial buildings were erected in the period from 1885 to 1910, and represent a variety of architectural styles. Although building material and detail differ, there are definite patterns that should be respected and incorporated into new development and renovation. Common elements of design include façade height and structure, strong pedestrian orientation, and attention to ornamentation. Similarity in Height, Mass and Scale Most buildings are one or two stories high and range from about eighteen to thirty feet in height. The majority of the buildings in the Village on Branch Street between Traffic Way and Mason Street are also narrow as well, which emphasizes their vertical character. The most common façade design is two stories high, although some buildings use a “false front” to achieve the impression of height. This façade treatment, when used on a relatively narrow building, stresses the strong vertical elements in the structure and creates an impressive image. Buildings are also made to appear larger by creating a series of attached facades, linking several smaller structures to create the appearance of one large building. These techniques lead to a more impressive appearance without losing pedestrian scale or blocking views and light. 28 Page 478 of 512 C ITY OF A RROYO G RANDE GUIDELINES & S TANDARDS FOR H ISTORIC D ISTRICTS Similarity of Material Brick and stone masonry construction is common, especially along Branch and Bridge Streets. Although some exteriors have been painted, such as the Olohan Building, the buildings retain many architectural details of “brick front” construction. This was one of the most popular storefront types of vernacular design, and incorporated commercial establishments on the ground floor with storage, offices or living quarters on the second level. An unusual vernacular style that uses locally quarried yellow stone is also found in the Village Downtown district. The unifying element is the stone itself, which calls for simplicity of construction and ornamentation, but the buildings using this material vary significantly in design. Another common material is wood siding, especially clapboard or weatherboard. Sense of Experimentation Although similar architectural styles are evident, and many elements are common, there is no one predominant architectural style, and elements are often combined in creative ways. The historic character, however, is maintained. Pedestrian Orientation Most commercial buildings have large display windows and a main entrance that faces the street, oriented to pedestrian traffic. There is no setback from the sidewalk, and buildings are generally designed and detailed to human scale, contributing to an atmosphere where pedestrians feel comfortable. Variety in Building Form There is sufficient variety in height, mass, scale and proportion to create visual interest in the Village Core Downtown Area. There is also a mixture of uses that includes retail establishments, cafes, restaurants and offices, often within the same block. DESIGN GUIDELINES AND STANDARDS Mixed Use Projects Within the Village Core Downtown Mixed use projects within the Village Core Downtown shall be predominantly commercial in character. Upper story residential and office uses designed to be compatible with ground floor retail uses are appropriate. Design of mixed use projects shall not impede pedestrian flow or disrupt concentration of retail, cultural and entertainment uses. The following building elements shall NEITHER overpower the project or detract from the visual continuity of the streetscape or neighborhood NOR produce redundancy in feature or pattern that is discordant with the historic character of the district: • Building scale • Building form • Building façade • Building entrance • Roofline • Fencing, rails or trellis • Archways, columns or towers • Doors and windows • Signage or feature designed for sign placement • Colors 29 Page 479 of 512 C ITY OF A RROYO G RANDE GUIDELINES & S TANDARDS FOR H ISTORIC D ISTRICTS Site Design 1. All new projects or renovations shall adhere to the site development standards of the Development Code. 2. The existing front setbacks of zero to fifteen feet (0’ to 15’) shall be required with main entries facing the street. A majority of the building frontage shall face the street and incorporate design features oriented to the pedestrian. 3. Streetscape improvements shall complement the existing design sidewalk paving, lighting schemes and street furniture within the district. 4. All enclosures for service areas, trash or recycling containers shall be designed as part of the overall project or building. Materials, textures and colors should be consistent with those of the proposed project and compatible with adjacent buildings. 5. Landscaping shall retain existing trees and plants as much as possible. Street trees and sidewalk planters shall be incorporated where feasible and pedestrian circulation will not be obstructed. (Streetscape elements within the public right-of-way, require an Encroachment Permit from the Public Works Department.) Landscaping in parking areas shall conform to the requirements of Title 16 of the Municipal Code (Development Code). Building Design 1. The height of new buildings shall not exceed development standards allowed in Title 16 of the Municipal Code. Scale and massing of any building within this area shall be consistent with that of the neighboring buildings, as described above in “Similarity in Height, Scale and Massing”. 2. The existing pattern of building façades shall be incorporated into new development projects. Dominant façade designs incorporate either brick front elements or parapet features. Roof patterns generally associated with residential buildings such as gable, hip or gambrel are generally not appropriate for commercial building frontages in the Village Core Downtown District. 3. For retail commercial buildings, display windows should complement the design of surrounding historic buildings and shall be oriented to pedestrian traffic. 4. Transoms are common over display windows, and were used for light and ventilation. When possible, transoms should be incorporated into new building design, and existing transoms should be used in building renovations. 5. New construction should include elements such as cladding, roof structure and ornamentation common to the district. All new projects shall use materials – including roof materials – that fit within the character of the Village Core Downtown district. By using similar materials or replicating these materials on all projects and restorations, the existing character will be reinforced and extended. 6. Decorative fixtures, including awnings, signs, and lighting, shall be integrated with other design elements of the structures. Construction Materials 1. Brick and stone masonry are the most common façade materials used on historic character structures in the Village Core Downtown district, and are acceptable façade materials. Some brickwork has been painted, and this is consistent with design style of the 1870- 1939 period. 30 Page 480 of 512 C ITY OF A RROYO G RANDE GUIDELINES & S TANDARDS FOR H ISTORIC D ISTRICTS Other acceptable façade materials include yellow sandstone (such as that on the I.O.O.F. building), and wood cladding. Wood cladding shall be of painted clapboard, painted weatherboard, or board and batten styles. Materials of similar design, color and texture may be considered. Smooth plywood panels are not appropriate unless detailed for the historic period. 2. Window sashes shall be of wood or painted steel, and consistent with the historic period. Materials that approximate the appearance of original materials may be substituted subject to the approval of the Architectural Review Committee, but unfinished aluminum is not allowed. 3. Door materials were traditionally wood panel and glass, either single or double. New or replacement doors shall be wood or an approved substitute material that approximates the appearance of original materials. Aluminum entry doors with large glass panels are inappropriate for the Village Core Downtown District. 4. Original decorative details should be retained during renovation. If the original materials have deteriorated and must be removed, they shall be replaced with materials that match as closely as possible the original in design, color, and texture. 5. Reflective glass is not appropriate in the Village Core Downtown District. Stained glass may be used as an accent material if it is consistent with the historic period of the building. Building colors 1. The number of colors used on a building should be kept to a minimum. 2. While bright colors may be used for limited accent, their use is subject to review by the Architectural Review Committee (ARC). 3. Color samples shall be submitted as part of Plot Plan Review or Conditional Use Permit process. 4. The use of fluorescent, “neon” or “day- glo” colors on building facades is not appropriate, historic base colors should be used instead. 5. Accent colors used for ornamentation, awnings, dentils, friezes or other details shall harmonize with the predominant building color. 6. Color palettes shall complement the majority of the neighboring buildings and be consistent with the historic period. 31 Page 481 of 512 ATTACHMENT 9 Planning Commission-Recommended Alternative Ordinance ORDINANCE NO. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE REGARDING THE ESTABLISHMENT OF A PERMANENT PARKLET PROGRAM WHEREAS, the City of Arroyo Grande (“City”) currently does not allow the placement of permanent parklets within the right of way; and WHEREAS, the purpose of these regulations is to ensure that parklets within the right of way conform to the existing character of the area in which they are located and do not create an adverse impact on adjacent properties; and WHEREAS, the Planning Commission finds that, unless properly regulated, parklets can result in similar adverse impacts to adjacent properties; and WHEREAS, the Planning Commission has considered the proposed Ordinance approving Development Code Amendment 22-003 at a duly noticed public hearing on September 6, 2022; and WHEREAS, it is the purpose of the proposed Ordinance to protect the public health, safety, and welfare of residents within the City by establishing regulations for a permanent parklet program; and NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Arroyo Grande as follows: SECTION 1: The above recitals and findings are true and correct and incorporated herein by this reference. SECTION 2: Arroyo Grande Municipal Code Section 16.52.250 is hereby added as follows: SECTION 16.52.250 – PARKLETS A. Purpose and Intent. The purpose and intent of these regulations is to ensure that parklets located in the City conform to the existing character of the area in which they are located and do not create an adverse impact on adjacent properties. B. Application and Approval. 1. Operators of parklets within the right of way are required to obtain a Minor Use Permit - Plot Plan Review pursuant to AGMC 16.16.080, and an Encroachment Permit pursuant to AGMC Section 13.26. 2. Operators of parklets shall pay a parking space rental fee of 5% of the parking in-lieu fee for each space annually. 3. Operators of parklets shall pay a rental fee for City-owned safety barriers. 4. Upon vacation by a parklet operator of the premises adjoining the parklet, the Minor Use Permit - Plot Plan will terminate. Page 482 of 512 ORDINANCE NO. PAGE 2 5. Existing operators of temporary parklets shall have 90 days from the date of ordinance adoption (______) to submit an application for a permanent parklet and removal of an existing temporary parklet. All temporary parklets shall be removed within six months of the ordinance adoption date of ______. C. Performance Standards and Conditions. Location 1. A parklet shall only be located in designated on-street parking areas. 2. A parklet shall not block sight distance at intersections or driveways. Accordingly, a parklet shall not be located less than twenty-five feet (25’) from a roadway intersection, adjacent driveway, or other points of off-street access which require line of sight standards as required by the City’s Engineering Standards. The final location of a parklet will vary based on the proposed parklet design, and shall be subject to review and approval by the Community Development Director. 3. Parklets are prohibited in disabled parking zones, parking areas of thirty minutes or less, and no-parking zones. 4. A parklet may not cover or impede access to any utility equipm ent, utility pole, fire hydrant, parking permit kiosk, or utility access such as manhole covers, drainage inlets, stormwater drainage flow lines and equipment shelters, subject to review by the City Public Works Director and Fire Chief. 5. The parklet shall not extend beyond the building frontage of the business utilizing the parklet without written consent from the adjacent business. Parklet Design 6. Parklets shall consist of no more than two adjoining parking spaces, or forty- feet (40’) in length. When a parklet is shared by two or more businesses, the parklet length may be extended up to eighty (80) feet in length and no more than four adjoining parking spaces. 7. A parklet’s walls or railing shall not have a continuous height that exceeds forty- two inches (42”) and shall not block views in or out of the parklet. Columns or other vertical framing for overhead elements are permitted. All elements of a parklet shall have a maximum height limit no higher than the first floor of the adjacent building. All parklets shall maintain a vertical walkway clearance height of at least eight feet (8’). 8. The depth (dimension measured perpendicular to curb) of a parklet shall be no less than the minimum dimension required to meet ADA accessibility requirements. Portions of the required parklet depth may be located within an existing sidewalk area as long as the sidewalk encroachment does not reduce the pedestrian path of travel to a width of less than four and a half feet (4.5’) in the public right of way. 9. A parklet shall include an element that ensures public safety by providing a barrier or fortified railing between moving vehicles and parklet users. These barriers shall either be well articulated or allow for plants or vegetation for screening. Page 483 of 512 ORDINANCE NO. PAGE 3 10. Parklets shall have a flush transition at the sidewalk and curb to permit easy access and avoid tripping hazards. 11. A parklet shall comply with applicable Americans with Disabilities Act (ADA) accessibility standards. Compliance with ADA standards is required with respect to design elements of the parklet, as well as for adjacent areas that may be impacted by the parklet. Parklets shall use a slip -resistant flooring material to minimize hazards and shall be accessible to wheel-chair users. 12. The four corners of a parklet shall have a reflective element or other clearly visible design feature, such as a soft-hit post, bollard, or raised pavement marker, to illuminate the parklet at night and signify the parklet envelope. 13. Parklets shall be consistent with the Village Design Guidelines 14. The primary materials shall be stone, brick, wood, decorative concrete or composite wood. Wood materials such as lattice and T1-11 plywood siding, are prohibited. 15. Color schemes shall consist of one primary color and one secondary color unless natural wood is used. 16. Areas for the storage of trash, recycling, and green waste receptacles shall not be visible from the public right of way and all waste receptacles shall be emptied and maintained by the applicant in a neat and sanitary order. SECTION 3: Arroyo Grande Municipal Code Section 16.04.070 is hereby amended as follows: 16.04.070 Definitions “Parklet” means a small seating area created as a public amenity in a former roadside parking space utilized by a food service business for outdoor dining. SECTION 4: If any section, subsection, subdivision, paragraph, sentence, or clause of this Ordinance or any part thereof is for any reason held to be unlawful, such decision shall not affect the validity of the remaining portion of this Ordinance or any part thereof. The City Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, or clause thereof, irrespective of the fact that any one or more section, subsection, subdivision, paragraph, sentence, o r clause be declared unconstitutional. SECTION 5: Upon adoption of this Ordinance, the City Clerk shall file a Notice of Exemption pursuant to 14 CCR § 15062. SECTION 6: A summary of this Ordinance shall be published in a newspaper published and circulated in the City of Arroyo Grande at least five (5) days prior to the City Council meeting at which the proposed Ordinance is to be adopted. A certified copy of the full text of the proposed Ordinance shall be posted in the office of the City Clerk. Within fifteen (15) days after adoption of the Ordinance, the summary with the names of those City Council Members voting for and against the Ordinance shall be published again, and the City Clerk shall post a certified copy of the full text of such adopted Ordinance. Page 484 of 512 ORDINANCE NO. PAGE 4 SECTION 7: This Ordinance shall take effect thirty (30) days from the date of adoption. On motion of Council Member , seconded by Council Member , and on the following roll call vote to wit: AYES: NOES: ABSENT: The foregoing Ordinance was adopted this 6th day of September 2022. Page 485 of 512 ORDINANCE NO. PAGE 5 ___________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: ___________________________________ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: ___________________________________ WHITNEY McDONALD, CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 486 of 512 ATTACHMENT 10 DRAFT RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING THE MASTER FEE SCHEDULE FOR THE COMMUNITY DEVELOPMENT DEPARTMENT BY ESTABLISHING A NEW FEE FOR PARKLETS WHEREAS, on December 7, 2007 the City Council adopted Resolution No. 4060 approving a Citywide Master Fee Schedule; and WHEREAS, on October , 2022 the City Council adopted an Ordinance to establish a permanent parklet program; and WHEREAS, the purpose of these regulations is to ensure that parklets within the right of way conform to the existing character of the area and are secured by protective barriers to provide safety for its users; and WHEREAS, the ordinance requires parklets to be located within the City right of way in off-street parking stalls and rental of City-owned barriers to secure the parklet; and WHEREAS, the costs of utilizing City right of way to establish a parklet and renting City owned protective barriers are to be offset by the operators of the parklet; and WHEREAS, the Master Fee Schedule does not include fees for use of City right-of-way or rental of City-owned barriers that are required by adopted permanent parklet program; and WHEREAS, the City Council has considered the proposed fee structure for the permanent parklet program; and WHEREAS, at a duly noted public meeting, the City Council considered all oral and written presentations that were made regarding the fees associated with permanent parklet program. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Arroyo Grande does hereby amend the Master Fee Schedule to update the fees and fee structure for the Community Development Department by adding fees related to the Permanent Parklet Program for Parking Space Rental and Protective Barrier Rental, as set forth in Exhibit “A” attached hereto and incorporated herein by this reference as though set forth in full. On motion by Council Member _________, seconded by Council Member _______, and on the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was passed and adopted this day of October, 2022. Page 487 of 512 RESOLUTION NO. PAGE 2 __________________________________ CAREN RAY RUSSOM, MAYOR ATTEST: JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: _________________________________ WHITNEY MCDONALD, CITY MANAGER APPROVED AS TO FORM: _________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Page 488 of 512 RESOLUTION NO. PAGE 3 EXHIBIT ‘A’ City of Arroyo Grande MASTER FEE SCHEDULE COMMUNITY DEVELOPMENT DEPARTMENT Fee Description Parking Space Rental for Parklets (per space) per month $ 100.00 Protective Barrier Rental for Parklets (per barrier) per month $ 25.00 Page 489 of 512 Item 11.a. MEMORANDUM TO: City Council FROM: Whitney McDonald, City Manager Timothy J. Carmel, City Attorney SUBJECT: Discussion and Consideration of Approval of a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority and Appointment of a Representative to the Authority Board of Directors DATE: September 27, 2022 SUMMARY OF ACTION: Approval of the proposed Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority (CCB JPA Agreement) (Attachment 1) with the cities of Grover Beach and Pismo Beach for the Central Coast Blue Project (Project). Appointment of a Council representative to the CCB JPA Board of Directors will enable the JPA Board to meet before the City Council ordinarily makes committee appointments in December if necessary to address needs of granting or loaning agencies. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The City’s Biennial Budget for Fiscal Years 2021-23 includes a total of $1,420,000 in the Water Availability Fund for the Central Coast Blue Project, $720,000 for Fiscal Year 2021 - 22 and $700,000 for Fiscal Year 2022-23. The CCB JPA Agreement obligates the City to pay for 25% of the total costs of the Project consistent with the Cost Sharing Agreement approved by the City Council on January 25, 2022. The City of Pismo Beach will pay 39% of the costs and the City of Grover Beach will pay 36% of the costs. Total costs for the Project are currently estimated to be $92,595,000. To date, $17,120,000 in federal and State grants have been awarded to fund the Project. It is anticipated that the Project could receive an estimated $29,178,000 of additional federal and State grants, which would reduce these costs. The City’s portion of the estimated remaining $46,297,000 in Project costs is $11,574,250. It is anticipated that this amount would be financed through low interest loans provided by federal or State programs such as the Water Infrastructure Finance and Innovation Act (WIFIA) and/or the State Revolving Fund. In addition to the pre-construction and construction costs of the project, the three Cities will also support their share of operating and maintenance costs of the Central Coast Blue facility, which is currently projected to begin in 2026. The Water and Sewer Rate Study approved by Page 490 of 512 Item 11.a. City Council Discussion and Consideration of Approval of a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority and Appointment of a Representative to the Authority Board of Directors September 27, 2022 Page 2 Council on January 11, 2022 (Attachment 3), provides recommended water rates necessary to fund the City’s share of costs for the Proje ct. RECOMMENDATION: 1) Authorize the Mayor to execute a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority (Authority); and 2) appoint a member of the City Council to the Authority Board of Directors BACKGROUND: The City of Pismo Beach has been the lead agency for the Central Coast Blue Project. The Project has been a multi-agency effort between three of the four Northern Cities Management Area agencies (the Cities of Arroyo Grande, Grover Beach, and Pismo Beach) and the South San Luis Obispo County Sanitation District1 to construct a regional recycled water project that will enhance supply reliability by injecting advanced purified water into the Santa Maria Groundwater Basin. The Project will reduce vulnerability to drought and seawater intrusion by creating a seawater intrusion barrier and supplementing the naturally occurring groundwater. At its January 25, 2022 meeting, the City Council authorized entering into a Cost Sharing Agreement with the cities of Grover Beach and Pismo Beach for the Project, as well as a Resolution that authorized the City Manager to apply for financial assistance from Clean Water State Revolving Fund administered by the State Water Resources Control Board for the City’s share of anticipated construction costs for the Project. A copy of the January 25, 2022 staff report related to the Cost Sharing Agreement is attached for reference (Attachment 2) and contains additional information regarding the process leading up to approval of that agreement, as well as information related to the financing for the Project. The Cost Sharing Agreement also contained provisions related to the contemplated creation of a joint powers authority, which will be a separate legal public entity, pursuant to Government Code section 6500 et seq., that will own and operate the Project and have the power to issue debt and enter into loans or finan cing agreements to finance the construction costs for Phase 1 of the Project. As set forth in the Cost Sharin g Agreement, the Joint Powers Agreement is to contain provisions addressing acquisition of the f acility site from Pismo Beach by the Authority, ownership of the facility, and financing of construction costs, including repayment obligations of the parties consistent with the Water Purveyor Contribution percentages identified in the Cost Sharing Agreement. The CCB JPA Agreement has been negotiated by staff for the cities of Arroyo Grande, Pismo 1 Although it has contributed to the overall Project effort, the South San Luis Obispo County Sanitation District is not a party to the JPA during Phase I and will not be involved in the construction or initial operation of the Project. Page 491 of 512 Item 11.a. City Council Discussion and Consideration of Approval of a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority and Appointment of a Representative to the Authority Board of Directors September 27, 2022 Page 3 Beach and Grover Beach and is now being presented to the City Cou ncil for its consideration and approval. On September 14, 2022, the first joint City Council meeting called for in the Cost Sharing Agreement was held with the City Councils of the cities of Arroyo Grande, Grover Beach, and Pismo Beach. At that meeting, the City Councils and the public received an update from the Project’s design and engineering consultant, Water Systems Consulting (WSC), regarding the Project components and purpose, preliminary design of the Advanced Treatment Facility, updated cost estim ates, grant funding opportunities and awards, and permitting requirements. The City Manager for Arroyo Grande also provided information regarding the Cost Sharing Agreement and the anticipated CCB JPA. Total costs to construct the Project are now estimated to reach approximately $93 million. With anticipated federal and state grants, the City’s share of the remaining, non-grant funded costs is anticipated to be approximately $11.6 million. The City’s current water rates will be sufficient to cover these anticipated construction costs. ANALYSIS OF ISSUES: As previously explained in the January 25, 2022 staff report, the Project will help address the threat of seawater intrusion by injecting recycled wate r into the basin at key locations near the seawater interface. Phase 1 of the Project proposes to treat wastewater from the City of Pismo Beach to an advanced purification level to create approximately 900 acre- feet of additional water per year. This new developed water will be injected into the basin at key locations to help to ensure that a sufficient barrier exists within the basin to keep seawater from flooding into the aquifer and contaminating the wells used by the NCMA parties. As a result, the Project will support the City’s ability to rely on groundwater to supply water to its residents and businesses into the future. Approval of the CCB JPA Agreement and completion of the Project will secure an estimated 225 acre -feet per year of reliable groundwater for the City. Proposed CCB JPA Agreement The CCB JPA Agreement contains provisions to provide for the ongoing operation of the Project. It provides that the new Central Cost Blue Regional Recycled Water Authority will have the responsibility for the operation and maintenance of the Project and will own the Facility Sites, Facilities, Ancillary Facility Sites and Ancillary Facilities, which are defined in the Agreement. It references and incorporates the Cost Sharing Agreement, and contains provisions to be consistent with it. It has also been reviewed and revised by bond counsel, to address and facilitate anticipated future financing for the Project. The Agreement contains provisions relating to: Page 492 of 512 Item 11.a. City Council Discussion and Consideration of Approval of a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority and Appointment of a Representative to the Authority Board of Directors September 27, 2022 Page 4 o The powers of the Authority (e.g., to make contracts, employ staff and consultants, acquire and dispose of property, issue bonds and incur debts and liabilities, apply for grants, etc.). o The governance of the Authority. There will be a Board of Directors, which will have a Chair and Vice Chair, will meet at least quarterly, and which will consist of one representative of each city, as well as one alternate. Except for reimbursement for actual costs and expenses, the Board will serve without compensation from the Authority. o An annual budget process. In March of each year, the Board is to adopt a preliminary budget and an allocation of contributions from the Member Agencies for presentation to each Member Agencies' governing body. The governing body of each Member Agency is to then review and comment on the preliminary budget and allocation of contributions. The Board is to adopt a final budget prior to July 1 of each year and adopt an allocation of contributions from the Member Agencies to be consistent with the percentages agreed to for Pre-Construction and Construction costs for Phase 1 of the Project (i.e., Arroyo Grande 25%, Grover Beach 36%, and Pismo Beach 39%). Each annual budget is to be adopted by an affirmative unanimous vote of the Directors, except that the first annual budget may be adopted by a majority vote. o Construction financing, operations and maintenance costs, capital improvement costs, and debt service. In connection with the issuance of debt, each party will enter into a Financing Agreement with the Authority securing the obligation of such party to make payments on its share of debt service. The Financing Agreements will stipulate that p ayment to the Authority is a special limited obligation payable solely from system net revenues of each party’s Enterprise Fund. Termination, withdrawal of Member Agencies and the effect of withdrawal, including continuing liability (the Agreement makes it clear that the debts, liabilities, and obligations of the Authority are not the debts, liabilities and obligations of any of the Member Agencies) and indemnification. Appointment to the Authority Board of Directors In addition to consideration and approval of the CCB JPA, it is recommended that the City Council appoint a representative to the Authority Board of Directors. While appointments to regional and local boards and committees are typically considered by Council in December of each year, selection of a representative to the Authority Board at this time will enable the Board to meet sooner, if necessary for purposes of applying for funding or financing. Page 493 of 512 Item 11.a. City Council Discussion and Consideration of Approval of a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority and Appointment of a Representative to the Authority Board of Directors September 27, 2022 Page 5 ALTERNATIVES: 1. Approve staff’s recommendation to authorize the Mayor to execute the proposed Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority with the cities of Grover Beach and Pismo Beach for the Central Coast Blue Project; and appoint a member of the City Council to the Authority Board of Directors; 2. Do not approve staff’s recommendation to authorize the Mayor to execute the proposed Joint Exercise of Powers Agreement and provide direction to staff related to any changes that the City Council wants the City Manager to negotiate with the other parties; and/or do not appoint a member of the City Council to the Authority Board of Directors at this time; 3. Provide other direction to staff. ADVANTAGES: The City Council has already approved the City’s participation in the Project and the City has executed the Cost Sharing Agreement, which contemplates that the parties will create a Joint Powers Authority to own and operate the Project. Approval of the CCB JPA Agreement will provide a framework for operating, managing and administering the Project. The Project is important for the ongoing resiliency of groundwater resources relied upon by the City, as well as all residents, businesses, agricultural operations, and visitors to the Five Cities area. DISADVANTAGES: Since the City has already approved participation in the Project and entered into the Cost Sharing Agreement, no disadvantages to entering into the CCB JPA Agreement have been identified, as it will provide the needed framework for operating, managing and administering the Project. ENVIRONMENTAL REVIEW: The City of Pismo Beach is the Lead Agency under the California Environmental Quality Act (CEQA) for the Project and previously prepared, circulated, and approved an Environmental Impact Report (EIR), and adopted findings and a Statement of Overriding Considerations on February 16, 2021. The City of Arroyo Grande is a Responsible Agency for the Project under CEQA. On March 23, 2021, the City Council adopted findings and a Statement of Overriding Considerations for the Project relying on the EIR in compliance with CEQA. No additional CEQA findings are required at this time. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Page 494 of 512 Item 11.a. City Council Discussion and Consideration of Approval of a Joint Exercise of Powers Agreement Creating the Central Coast Blue Regional Recycled Water Authority and Appointment of a Representative to the Authority Board of Directors September 27, 2022 Page 6 Attachments: 1. Proposed Joint Exercise of Powers Agreement Creating the Central Cost Blue Regional Recycled Water Authority 2. January 25, 2022 Staff Report relating to Cost Sharing Agreement 3. January 11, 2022 Staff Report and attachments Page 495 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY THIS JOINT EXERCISE OF POWERS AGREEMENT ("Agreement") is made and entered into by and between the City of Arroyo Grande, a California municipal corporation (“Arroyo Grande”), the City of Grover Beach, a California municipal corporation (“Grover Beach”), and the City of Pismo Beach, a California municipal corporation (“Pismo Beach”). The cities may be individually referred to herein as a “Party” or collectively as the “Parties.” RECITALS WHEREAS, each Party to this Agreement is a public agency authorized and empowered to contract for the joint exercise of powers under Articles 1 through 4, Chapter 5, Division 7, Title 1 (commencing with Section 6500) of the Government Code of the State of California; and WHEREAS, in 1983, the Parties hereto entered into a voluntary groundwater management plan to manage the safe yield of the Arroyo Grande Groundwater Basin, which agreement was updated by the Parties through approval of the 2002 Agreement Regarding Management of the Arroyo Grande Groundwater Basin (the “Management Agreement”); and WHEREAS, on April 30, 2002, the Parties hereto, among others, entered into a settlement agreement (the “Settlement Agreement”) related to a 1997 groundwater adjudication litigation filed by the Santa Maria Valley Water Conservation District, which reaffirmed the Management Agreement, established separate water management areas (the “Original Management Areas”) to be independently managed by the Parties and others, and requiring the Parties and others to develop an equitable cost sharing agreement for any newly constructed water resource and water production facilities within the Original Management Areas; and WHEREAS, on June 30, 2005, the Parties hereto entered into a stipulation imposing a physical solution for ensuring the Arroyo Grande Groundwater Basin’s long-term stability (the “Stipulation”). The Stipulation adopted a local management approach, establishing three management areas (the “Current Management Areas”) and requiring a monitoring program to be established in each of the Current Management Areas; and WHEREAS, on January 25, 2008, the Santa Clara Superior Court entered Judgment in the Santa Maria Groundwater Adjudication litigation approving the Stipulation, without qualification (the “Adjudication Decree”); and WHEREAS, the Parties are participating in the Central Coast Blue Project to construct a regional recycled water project that will enhance supply reliability by injecting advanced purified water into the Northern Cities Management Area of the Santa Maria Groundwater Basin (“Project”). The Project will reduce vulnerability to drought and seawater intrusion by creating a seawater intrusion barrier and supplementing the naturally occurring groundwater; and WHEREAS, Phase 1 of the Project includes construction of an Advanced Treatment Facility (“ATF”), treatment of secondary treated flows from Pismo Beach’s Wastewater Treatment Plant (“WWTP”), construction of approximately five injection wells and associated transmission lines, and injection of flows from the WWTP (“Phase 1”). Phase 1 proposes to treat wastewater from Pismo Beach to an advanced purification level to create between nine hundred (900) and one thousand (1,000) acre-feet of additional water per year; and Page 496 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 2 WHEREAS, Phase 2 of the Project will include upgrades to the ATF to increase capacity, construction of approximately two additional injection wells and associated transmission lines, and injection of flows from the South San Luis Obispo County Sanitation District Wastewater Treatment Plant (“Phase 2”); and WHEREAS, Arroyo Grande, Grover Beach and Pismo Beach believe that the best way to achieve their joint goals in a way that is mutually beneficial is to form a joint powers agency under Articles 1 through 4, Chapter 5, Division 7, Title 1 (commencing with Section 6500) of the Government Code of the State of California ("Joint Exercise of Powers Act"); and WHEREAS, by forming a joint powers agency ("JPA") under the Joint Exercise of Powers Act, the Parties believe they will be better able to, through a separate JPA, oversee and manage the planning and implementation, including but not limited to construction, operation and administration of, the Project. NOW THEREFORE, in consideration of the above Recitals and of the mutual promises and agreements contained herein, the Parties agree as follows: ARTICLE 1 GENERAL PROVISIONS 1.1 Definitions. Unless the context otherwise requires, the words and terms defined in this Section 1.1 shall, for the purposes of this Agreement, have the meanings herein specified. 1.1.1. Act means Articles 1 through 4, Chapter 5, Division 7, Title 1 of the Government Code of the State of California (commencing with Section 6500) relating to the joint exercise of powers common to public agencies. 1.1.2. Agreement means this Joint Exercise of Powers Agreement. 1.1.3. Ancillary Facilities means injection wells, storage tanks, pump stations, associated piping, and any other equipment located on an Ancillary Facilities Site. 1.1.4. Ancillary Facilities Sites means any real property or real property interest held by the Authority for purposes of the Project, excluding the Facility Site. 1.1.5. Annual Budget means the budget adopted pursuant to Section 6.2.2 of this Agreement. 1.1.6. Authority means the Central Coast Blue Regional Recycled Water Authority, which is created by this Agreement. 1.1.7. Board or Board of Directors means the Board of Directors referred to in Article 2 of this Agreement, which is the governing body of the Authority. 1.1.8. Bonds means bonds, notes, commercial paper, and any other evidence of indebtedness of the Authority authorized and issued pursuant to the Act, any indebtedness issued or incurred by the Authority pursuant to any act supplementary to the Act, including, but not limited to, refunding bonds authorized and issued pursuant to Article 11 of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code of the State of California. 1.1.9. Cost Sharing Agreement means the Cost Sharing Agreement for the Parties’ Participation in the Central Coast Blue Project dated March 14, 2022, a copy of which is attached hereto as Exhibit A and incorporated herein. Page 497 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 3 1.1.10. Director means a member of the Board appointed to the Board pursuant to Section 2.2 of this Agreement. 1.1.11. Effective Date means the last date on which all Parties to this Agreement have executed the Agreement. 1.1.12. Facility or Facilities means the advanced water treatment facility that will receive and further treat wastewater influent from Pismo Beach’s WWTP, in Phase 1, which as of the date of this Agreement is proposed to be constructed on Assessor’s Parcel Number 060- 543-016 in the City of Grover Beach, including the Facility’s equalization basin, injection wells, storage tanks, pump station and associated piping and equipment from the Pismo Beach.WWTP, but excluding the joint outfall shared by the South San Luis Obispo County Sanitation District and the City of Pismo Beach which both agencies use to discharge their municipal waste. 1.1.13. Facility Site means Assessor’s Parcel Number 060-543-016 in the City of Grover Beach, California. 1.1.14. Financing Agreement means any agreement between the Authority and a Member Agency securing the obligation of the Member Agency to make payments relating to Bonds or other obligations issued or incurred by the Authority in connection with the financing of the Facilities or the improvement, use or acquisition of real or personal property that is or will be owned or operated by the Authority, or to refinancing of such previously issued or incurred Bonds or other obligations. 1.1.15. Manager means the manager of the Authority. 1.1.16. Member Agency(ies) means Arroyo Grande, Grover Beach and Pismo Beach and any other entity added to this Agreement by a subsequent amendment. 1.1.17. Member of the Board or Board Member means and includes any duly appointed Director, Chair and/or Vice-Chair of the Board. 1.1.18. Party(ies) means those entities who have executed this Agreement or any Amendment to this Agreement and who have not withdrawn from the Authority. 1.2 Purpose. This Agreement is made pursuant to the Act by Arroyo Grande, Grover Beach and Pismo Beach, each of which is authorized to contract with the other pursuant hereto. The purposes of this Agreement are to create the Authority, provide for the administration of the Authority and to enable the Authority to: (1) take all actions necessary to operate, and maintain Phases 1 and 2 of the Project. Phase 1 includes construction of an ATF, treatment of all secondary treated flows from Pismo Beach’s WWTP, construction of approximately five injection wells and associated transmission lines, and injection of flows from the WWTP; and (2) pursue grant funding and financing options for the Project and future projects; and (3) collectively interact with regulatory agencies with oversight over the Parties and the Project. 1.3 Creation of Authority. Pursuant to the Act, there is hereby created a public entity known as the “Central Coast Blue Regional Recycled Water Authority." The Authority shall be a public entity separate and apart from the Member Agencies and shall administer this Agreement. Page 498 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 4 1.4 Term. The term of this Agreement shall commence on the Effective Date and shall continue until terminated by the Parties as provided in Article 7 of this Agreement. 1.5 Phase 1, Project Facility Site Ownership, Construction Financing, and Operation 1.5.1. Phase 1 of Project. As set forth in Article III, Section 1 – Lead Agency Duties of the Cost Sharing Agreement, Pismo Beach will be Lead Agency and act as project developer through final completion of Phase 1 of the Project. As the Lead Agency, Pismo Beach will act as the construction manager for Phase 1 and will provide administration of construction and start-up of Phase 1 on behalf of the Member Agencies. The Parties shall pay their pro rata shares of Pre-Construction costs for any professional service expenses incurred by Pismo Beach in connection with obtaining such Phase 1 approvals, in accordance with Section 6.3.2 below. 1.5.2. Ownership of Facility Sites and Facilities. Pismo Beach has previously purchased the Facility Site, which is located in Grover Beach and identified as Assessor’s Parcel Number 060-543-016 (“Facility Site”). Within sixty (60) days of the Effective Date of this Agreement, Pismo Beach shall transfer the Facility Site to the Authority. The Authority shall own all Facilities located at the Facility Sites, including, but not limited to, the real property, buildings, water and treatment facilities, and support infrastructure and assets, injection wells and related transmission lines. 1.5.3. Ownership of Ancillary Facilities Sites and Ancillary Facilities. The Authority shall own all Ancillary Facilities Sites and Ancillary Facilities located thereon. 1.5.4. Financing of Construction Costs. To finance Construction Costs, as defined in the Cost Sharing Agreement, the Authority shall apply for and obtain financing for such costs through the issuance of Bonds, entering into loans or Financing Agreements or any other financing mechanisms not otherwise covered by grant funding awarded to the Project. Any loans entered into and secured for construction of the Project may consist of separate installment sale agreements based on the respective share of each Member Agency, and any prepayment may be paid either directly to the Authority by each Party consistent with the Water Purveyor Contribution percentages identified in Section 6.3.2 hereof or directly to the grant funding agency or bond trustee, depending on the funding mechanism. In the event that the Authority is not able to finance the Construction Costs as described in this Section 1.5.4, the Parties will seek financing consistent with the financing plan described in Article III, Section 1.c of the Cost Sharing Agreement for its respective share of Construction Costs. 1.5.5. Operation and Maintenance of the Facilities. The Authority will have total responsibility for the operation and maintenance of the Facilities. 1.5.6. Procurement Methods. The Board may adopt such policies relating to procurement of services, equipment, supplies and other materials needed to accomplish the purposes of this Agreement. 1.6 Powers of Authority Page 499 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 5 1.6.1. General Powers. The Authority shall exercise, in the manner herein provided, the powers which are common to each of the Member Agencies, powers otherwise permitted under the Act, and powers necessary to accomplish the purposes of this Agreement. 1.6.2. Specific Powers. Subject to the limitations set out in Section 1.6.1, the Authority is hereby authorized, in its own name, to do all acts necessary, convenient and appropriate for the exercise of the foregoing powers for the purposes set forth in this Agreement and to do any or all of the following: i. To make and enter contracts, including contracts with its Member Agencies; ii. To employ agents, attorneys, consultants and employees or to contract for personnel to fulfill its mission and purpose. The Authority shall not contact employees of the Member Agencies at their current places of employment about employment opportunities with the Authority; iii. To lease, acquire, construct, manage, maintain or operate any building, works or improvements; iv. To lease, acquire, hold or dispose of real or personal property; v. To acquire and hold property, including funds, Project agreements and other obligations of any kind, and pledge, encumber or assign the same, or the revenues therefrom or any portion of such revenues, or other rights, whether then owned or possessed, or thereafter acquired, for the benefit of the bondholders, and as security or additional security for any bonds or the performance of obligations under an indenture; vi. To provide for the advance of bond proceeds and other funds pursuant to Project agreements as necessary to pay or reimburse for Project costs; vii. To borrow money and issue Bonds and incur debts, liabilities or obligations for the purpose of paying all or any part of the costs of the Project or for any other authorized purpose, which do not constitute a debt, liability or obligation of any Member Agency; viii. To receive gifts, contributions and donations of property, funds, services and other forms of assistance from persons, firms, corporations, and governmental entities, provided that the Authority consents to such gifts, contributions and donations; ix. To fix the compensation, if any, paid to the Board of Directors, Secretary, Treasurer, Controller and Attorney, in compliance with all applicable laws; x. To prescribe the duties, compensation and other terms and conditions of employment of other agents, officers and employees; xi. To adopt reasonable rules and regulations for the conduct of the day-to-day operations of the Authority; Page 500 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 6 xii. To apply for, accept, receive and disburse grants, loans and other aid from any agency of the United States of America or of the State of California; xiii. To sue and be sued in its own name; xiv. To enter into Financing Agreements, state funding agreements and federal funding agreements relating to the Project, and assume rights and obligations pursuant to these agreements; xv. To invest money in the treasury, pursuant to Government Code Section 6505.5, that is not required for the immediate necessities of the Authority, as the Authority determines advisable, in the same manner and on the same conditions as local agencies, pursuant to Section 53601 of the Government Code; xvi. To contract and pay compensation for professional, financial, and other services; xvii. To carry out and enforce all provisions of this Agreement; xviii. To exercise any and all powers which are provided for in the Act and in Government Code section 6584 et seq., including, without limitation, Government Code section 6588, as they exist on the Effective Date of this Agreement or may hereafter be amended; xix. To exercise any power necessary or incidental to the foregoing powers. ARTICLE 2 BOARD OF DIRECTORS 2.1. Creation. The Authority shall be governed by a board of three (3) members, which is hereby established and which shall be composed of one (1) representative appointed from each Member Agency. The governing board shall be known as the "Board of Directors of the Central Coast Blue Regional Recycled Water Authority." All voting power shall reside in the Board. 2.2. Members of the Board of Directors. 2.2.1. Directors Appointed. Upon the Effective Date of this Agreement, each Member Agency which has not already done so shall designate and appoint, by resolution or minute order of its governing body, one (1) member of its governing body to act as its representative on the Board of Directors, and one individual to act as an alternate to each Director so appointed. The alternate appointed by each Member Agency shall have the authority to attend, participate in and vote at any meeting of the Board when the regular member is absent. 2.2.2. Membership. Each Director and alternate of the Board of Directors shall serve until a successor is appointed; provided, however, each Director and alternate serves at the pleasure of the appointing Member Agency's governing body and may be removed at any time, with or without cause, at the sole discretion of the appointing Member Agency governing body. If a Director or alternate's membership on the appointing Member Agency's governing body ceases, his or her membership on the Board shall also cease. Page 501 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 7 2.2.3. Chair. The Board of Directors shall elect one of its members as Chair of the Board. The term of office for the Chair of the Board shall be one (1) year. The Chair of the Board shall preside at all meetings and shall perform such other duties as are specified by the Board of Directors. 2.2.4. Vice-Chair. The Board of Directors shall elect one of its members as Vice-Chair. The term of office for the Vice-Chair shall be one (1) year. The Vice-Chair shall perform all the duties of the Chair of the Board in the absence of the Chair of the Board or in the event the Chair of the Board is unable to perform such duties, and shall perform such other duties as are specified by the Board of Directors. 2.2.5. Board Compensation. Except for reimbursement for actual costs and expenses, the Board shall serve without compensation from the Authority. Compensation may be provided as approved by the Member Agencies appointing each Director and alternate, and any such compensation will be the responsibility of the Member Agency. 2.2.6. Reimbursement of Costs. Each Board Member is entitled to reimbursement for their travel, meals, lodging and other actual and necessary expenses incurred in the performance of the duties required or authorized by the Board pursuant to Government Code Section 53232.2. 2.3. Powers of the Board. All the power and authority of the Authority shall be exercised by the Board of Directors. 2.4. Provision for Bylaws. The Board may cause to be developed and may adopt, from time to time, such bylaws for the Authority to govern its day-to-day operations. Each Member Agency shall receive a copy of any bylaws developed and adopted under this Section. ARTICLE 3 MEETINGS OF THE BOARD 3.1 Meetings. The Board shall provide for its regular meetings by resolution; provided, however, that at least one regular meeting shall be held each fiscal quarter. The date, hour and place of the regular meetings shall be fixed by resolution of the Board and filed with the governing body of each of the Member Agencies. The Board may meet in joint session with other public agencies and advisory bodies in accordance with State law. 3.2 Ralph M. Brown Act. All meetings of the Board, including, without limitation, regular, adjourned regular, special, adjourned special, and emergency meetings, shall be called, noticed, held, and conducted in accordance with the provisions of the Ralph M. Brown Act, commencing with section 54950 of the Government Code. 3.3 Voting. Each Board Member shall have one vote. Except as otherwise provided by law or by this Agreement, all actions of the Board shall be approved on the affirmative vote of a majority of the Members of the Board. 3.4 Quorum. A majority of the Members of the Board shall constitute a quorum for the transaction of business, except that less than a quorum may adjourn from time to time. 3.5 Minutes. The Secretary of the Authority shall cause minutes of regular, adjourned regular, special, adjourned special, and emergency meetings to be kept and shall, as soon as possible after each Page 502 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 8 meeting, cause a copy of the minutes to be forwarded to each Member of the Board and to each Member Agency. 3.6 Rules. The Board may adopt from time to time such rules and regulations for the conduct of its affairs as may be required. ARTICLE 4 OFFICERS AND EMPLOYEES OF THE AUTHORITY 4.1 Secretary. The Board of Directors shall appoint a Secretary who shall serve at the pleasure of the Board. The Secretary may, but need not, be a member of the Board of Directors. The Secretary shall be responsible for the minutes and other records of the proceedings of the Board of Directors and shall perform such other duties as the Board of Directors specifies. 4.2 Treasurer and Auditor Controller. Pursuant to Government Code Sections 6505.5 and 6505.6, the Authority's Treasurer and Auditor/Controller shall be the Manager's senior financial officer (such as its chief financial officer, director of finance, or finance manager as designated by the Manager. The Treasurer shall be the depository and have custody of all money of the Authority, from whatever source, and shall have all of the duties and obligations set forth in Sections 6505 and 6505.5 of the Government Code. The offices of Treasurer and Auditor/Controller may be held by separate individuals, or combined and held by one individual as the Board may elect. The Treasurer and Auditor/Controller shall serve at the pleasure of the Manager and may be removed at any time, with or without cause, in the sole discretion of the Manager. 4.3 Authority Attorney. The Attorney for the Authority, who may not be counsel to one of the Member Agencies, shall be engaged by the Board of Directors. The Attorney for the Authority or a designated deputy shall attend or participate in meetings of the Board of Directors; provided, however, that the absence of the Authority Attorney shall not affect the validity of any meeting. The Attorney shall perform such other duties the Board of Directors specifies. 4.4 Official Bond. Pursuant to Government Code section 6505.1, the public officer, officers or persons who have charge of, handle or have access to any property of the Authority shall file an official bond in an amount to be fixed by the Parties to this Agreement. 4.5 Additional Officers and Employees. The Board shall have the power to appoint such additional officers and to employ such employees, assistants, contractors, consultants and others as may be appropriate. Such power shall include, but not be limited to, the power to appoint a Manager for the purposes of managing and administering the Authority, and an Operator for the purposes of providing operations, maintenance, and similar services to the Authority. A Member Agency may be appointed as the Authority's Manager and/or Operator pursuant to a written agreement with the Authority. ARTICLE 5 COMMITTEES 5.1 Committees. The Board of Directors, by a majority vote, may form committees for any purpose. Such vote shall designate the method for appointing committee members, the scope of the duties and responsibility of the committee, whether the committee is a standing or ad hoc committee, and such other matters as the Board may deem appropriate. Page 503 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 9 ARTICLE 6 FINANCES Fiscal year. The Fiscal Year of the Authority shall be the period commencing on July 1 of each year and ending on and including the following June 30. 6.2 Annual Budget. 6.2.1 Interim Budget. The Board shall, within one hundred and twenty days (120) days of the Effective Date of this Agreement, approve an interim budget, which shall constitute the operating budget until the Annual Budget is adopted. 6.2.2 Annual Budget. Except for costs related to construction of Phase I, which shall be subject to the Cost Sharing Agreement, annually, in March of each year, the Board shall adopt a preliminary budget and an allocation of contributions from Member Agencies for presentation to each Member Agencies' governing body. The governing body of each Member Agency shall, no later than May 31 of each year, review and comment on the preliminary budget and allocation of contributions. Thereafter, annually, prior to July 1 of each year, the Board shall adopt a final budget for all expenses to be made by the Authority during the ensuing Fiscal Year and adopt an allocation of contributions from Member Agencies consistent with Section 6.3.2. Each annual budget shall be adopted and shall be effective on the affirmative unanimous vote of the Directors, except that the first Annual Budget may be adopted by an affirmative vote of a majority of the Directors. Contributions for each Member Agency shall be due and payable to the Authority on a monthly basis with the first payment being made within thirty (30) days of approval of the budget. 6.2.3 Failure to Obtain Budget Approval. In the event the Board does not adopt a budget prior to the beginning of a fiscal year, the budgeted amounts of all expenses and allocation of contributions from Member Agencies shall remain the same as the amounts last approved by the Board in its most recently adopted budget; provided, however, that the amounts shall be increased by the Consumer Price Index ("CPI") with a minimum increase of no less than two percent (2%). The CPI shall mean the Consumer Price Index, Bureau of Labor Statistics, U.S. Department of Labor Consumer Price Index-All Urban Consumers, All Items, Los Angeles-Long Beach-Anaheim CA for the twelve (12) month period ending the February prior to the beginning of the fiscal year, or if this index no longer exists, an index approved by a majority of the Board. This factor shall be applied to the budget until such time as a new budget is adopted by the Board. Any shortfall in revenues shall be made up from available reserves dedicated by the Board for such purpose and, if insufficient to cover the shortfall, any available reserve funds which have not been designated by the Board for a particular purpose or otherwise legally restricted for other purposes. Reserves shall mean any available cash or investments. 6.3 Funds, Accounts and Reports. There shall be strict accountability of all funds and reporting of all receipts and disbursements. 6.3.1 Sources of Funds. The sources of funds available to the Authority may include, but are not limited to, the following: Page 504 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 10 i. Grants, donations, and loans received by the Authority from local, State, or Federal agencies or from individuals or businesses. ii. Funds collected as user charges or user fees by Member Agencies. iii. Funds collected from Members pursuant to this Agreement. iv. Funds received from State and Federal disaster relief agencies. v. Funds obtained by issuing Bonds. vi. Funds collected pursuant to a Financing Agreement. vii. "In kind" contributions from Member Agencies. viii. Funds from any other source derived. The Authority shall arrange for the receipt of such funds from the above sources as ar e available to the Authority and as are necessary for the conduct of the Authority's activities. Member Agencies may, in the appropriate circumstances: (a) make contributions from their treasuries for the purposes set forth in this Agreement; (b) make payments of public funds to defray the cost of such purposes; and (c) make advances of public funds for such purposes. The provisions of Government Code section 6513 are incorporated into this Agreement. 6.3.2 Water Purveyor Contributions. The Parties shall pay their pro rata share of all Pre- Construction and Construction Costs incurred by Pismo Beach in connection with Phase 1 of the Project. The Parties agree to the following cost allocation of the total Pre-Construction and Construction costs for Phase 1 for each Party: i. Arroyo Grande shall contribute 25%. ii. Grover Beach shall contribute 36%. iii. Pismo Beach shall contribute 39%. . As provided in Section 6.2.2, annual contributions by Member Agencies for ongoing operations shall be consistent with the above percentages. 6.3.3 Accounts. Revenues or funds received or made available to the Authority from any source whatsoever, shall be deposited into accounts that may be established by the Authority and may be expended by the Authority in any legal manner, subject to such reservations as may be imposed by the Authority from time to time. 6.3.4 Reports. The Treasurer shall, within one hundred and eighty days (180) days after the close of each Fiscal Year, give a complete written report of all financial activities for such fiscal year to the Board of Directors and to each Member Agency. The Authority's books and records shall be open to inspection at all reasonable times by representatives of each Member Agency. Page 505 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 11 6.4 Payments and Advances. No expenditures in excess of those budgeted shall be made without approval of a revised or amended budget, which may from time to time be submitted to and approved by the Board of Directors. 6.5 Audit. The Treasurer and Auditor/Controller shall cause an annual audit of the accounts and records of the Authority to be made and reported in accordance with Sections 6505 through 6505.6 of the Government Code. The audit shall be conducted by an independent certified public accountant. The audit shall conform to generally accepted auditing standards. Such report shall be filed within twelve (12) months of the end of the Fiscal Year under examination. ARTICLE 7 COST ALLOCATION 7.1 Operations and Maintenance Costs. Each Party shall pay its allocated share of all expenses incurred by the Authority for administration, operation, and maintenance of its Facilities and Ancillary Facilities based on the Water Purveyor Contribution percentages. 7.2. Capital Improvement Costs. Capital improvement costs to acquire, construct, or improve Facilities and Ancillary Facilities shall be subject to allocation between the Parties based on the Water Purveyor Contribution percentages. 7.3 Debt Service. In connection with the issuance of Bonds or the incurrence of other obligations by the Authority to finance or refinance Construction Costs or capital improvement costs to acquire, construct or improve Facilities and Ancillary Facilities, each Party shall negotiate a Financing Agreement with the Authority that includes provisions by which each Party shall make payments with respect to such Party’s share of debt service on the Bonds or other obligations incurred by the Authority, consistent with any pre-existing contractual obligations of each Party. Each Financing Agreement will stipulate that the debt service payments made by a Party to the Authority will be subject to the payment limitations set forth in Article IV, Section 5 of the Cost Sharing Agreement. For purposes of this Section 7.3, the provisions of Article IV, Section 5 of the Cost Sharing Agreement shall continue in full force and effect in the event that the Cost Sharing Agreement shall terminate. At the time of a Bond issuance or the entering into of any other obligation by the Authority, if a Party elects to pay its share of the capital improvement costs in full with cash, it will not be allocated any share of the debt service on such Bonds or other obligations incurred by the Authority, and will not be required to enter into a Financing Agreement with the Authority, for that Bond issuance or obligation. ARTICLE 8 TERMINATION/WITHDRAWAL/AMENDMENT 8.1 Duration and Termination. This Agreement shall become effective as of the Effective Date and shall continue in full force and effect until terminated by the mutual written agreement of all Member Agencies, which agreement shall meet the requirements imposed by the terms and conditions of all outstanding bonds, notes, warrants, indentures and other evidences of indebtedness; provided, however, that this Agreement and the Authority shall continue to exist for the purpose of disposing of all claims, distribution of assets, and all other functions necessary to conclude the affairs of the Authority. Page 506 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 12 8.2 Withdrawal. Notwithstanding any other provision of this Agreement, any Member Agency may withdraw from the Authority by providing the Authority with one hundred eighty (180) days written notice of its intent to withdraw. A withdrawal from the Authority constitutes a withdrawal of that Member Agency's representatives from the Board of Directors. 8.3 Effect of Withdrawal. The withdrawal of a Member Agency shall not terminate its responsibility to contribute its share of any obligation incurred by the Authority, including amounts determined by the Board for (1) liabilities and claims accrued during the time the agency was a Member Agency or (2) budgeted expenses for the Fiscal Year in which notice of intent to withdraw is given. Except as the withdrawing Member Agency may agree, in writing, with the Board, the withdrawing Member Agency shall automatically relinquish all rights as a Member Agency under this Agreement, on the effective date of the withdrawal. Upon termination of this Agreement, a Member Agency that has withdrawn will be treated like all other Member Agencies for purposes of disbursement of Authority assets, unless otherwise agreed in writing. 8.4 Disbursement. Upon termination of this Agreement and after payment of all liabilities, costs, expenses and charges validly incurred under this Agreement, all remaining assets of the Authority shall be disbursed among Member Agencies, including any Member Agencies which previously withdrew from the Authority. All assets shall be divided among the Member Agencies in accordance with and proportionate to the Water Purveyor Contribution amounts stated in Section 6.3.2, if it is feasible to do so. 8.5 Amendment. This Agreement may be amended at any time by the written approval of the governing body of each Member Agency upon recommendation of a majority of the Board of Directors of the Authority. ARTICLE 9 SPECIAL PROVISIONS 9.1 Insurance. The Authority shall maintain types and levels of insurance coverage for the Authority as the Board of Directors determines to be reasonably adequate, provided, however, that each Member Agency shall be named as an additional insured on such policy of and/or agreement for insurance coverage. 9.2 Liability of Authority, Board, Officers, Employees. Pursuant to Government Code section 6508.1, the debts, liabilities, and obligations of the Authority shall not be the debts, liabilities and obligations of any of the Member Agencies or any of their respective members, officers, directors, employees or agents. The Authority, its Directors, officers, employees, staff and agents shall use ordinary care and reasonable diligence in the exercise of their powers and in the performance of their duties pursuant to this Agreement. No Member Agency, its officer, director or employee shall be responsible for any action taken or omitted by any other Member Agency, or its officers, or employees or the Authority, its officers, or employees. 9.3 Indemnity. The Authority shall indemnify, defend and hold harmless the Board of Directors, the individual Member Agencies, and their elected officials, members, officers, directors, employees and agents from and against any and all liability, loss, damages, expenses, costs (including, without limitations, costs and fees of litigation or arbitration) of every nature, arising out of any act or omission related to this Agreement, including, but not limited to those related to the use of any property and/or facility of any Member Agency, The Authority shall indemnify, defend and hold harmless the individual Member Agencies, and their elected officials, members, officers, directors, employees and agents from and against any and all liability, loss, damages, expenses, costs (including, without limitations, costs and Page 507 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 13 fees of litigation or arbitration) of every nature, arising out of any willful misconduct of the Authority Board of Directors or its Board Members, officers or employees. Further, the duty of the Authority to indemnify, defend and hold harmless shall not extend to the activities of the individual Member Agencies, and their members, officers, directors, employees and agents that are outside the scope of this Agreement. The Authority's duty to indemnify each Member Agency pursuant to this Agreement shall survive that Member Agency's withdrawal from the Agency. This section shall not be deemed to supersede, extinguish, or modify the indemnification provisions in the Cost Sharing Agreement. 9.4 Conflict of Interest Code. The Authority shall, by resolution, adopt a conflict of interest code as required by law. ARTICLE 10 MISCELLANEOUS PROVISIONS 10.1 Severability. If any section, clause or phrase of this Agreement or the application thereof to any Party or any other person or circumstance is for any reason held to be invalid by a court of competent jurisdiction, it shall be deemed severable, and the remainder of the Agreement or the application of such provisions to the other Party or to other persons or circumstances shall not be affected thereby. Each Party hereby declares that it would have entered into this Agreement, and each subsection, sentence, clause and phrase thereof, irrespective that one or more sections, subsections sentences, clauses or phrases or the application thereof might be held invalid. 10.2 Notices. Notices required or permitted hereunder shall be sufficiently given if made in writing and delivered either personally or by registered or certified mail, postage prepaid to the respective Parties, as follows: City of Arroyo Grande Attention: City Manager 300 E Branch Street Arroyo Grande, CA 93420 City of Pismo Beach Attention: City Manager 760 Mattie Road Pismo Beach, CA 93449 City of Grover Beach Attention: City Manager 154 S. Eighth Street Grover Beach, CA 93433 10.3 Other Obligations. The responsibilities and obligations of each Party to this Agreement shall be solely as provided in this Agreement, or as may be provided for in other agreements to be executed by the Parties, including but not limited to the Cost Sharing Agreement. In the event there is any conflict between this Agreement and the Cost Sharing Agreement, the provisions of this Agreement shall be controlling. 10.4 Consent. Whenever in this Agreement or in any amendment thereto consent or approval is required, the same shall not be unreasonably withheld. 10.5 Other Agreements Not Prohibited. Other agreements by and between the Parties of this Agreement or any other entity are neither prohibited nor modified in any manner by execution of this Agreement. Page 508 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 14 10.6 Assignment. The rights, titles and interests of any Party to this Agreement shall not be assignable or transferable without the consent of the governing body of each Party hereto and the Board of Directors. Any assignment of a membership in the Authority made under this Section 10.6 by the governing body of any Party hereto will not result in the novation of the assignor Member Agency’s obligations with respect to this Agreement, a Financing Agreement or any other agreement which may obligate the assignor Member Agency, unless such novation is agreed to in writing by such consenting Member Agency, the assignee and the assignor Member Agency. 10.7 Section Headings. The section headings herein are for convenience of the Parties only, and shall not be deemed to govern, limit, modify or in any manner affect the scope, meaning or intent of the provisions or language of this Agreement. 10.8 Laws of California. This Agreement is made in the State of California, under the Constitution and laws of such State, and shall be construed and enforced in accordance with the laws of such State. 10.9 Construction of Language. It is the intention of the Parties hereto that if any provision of this Agreement is capable of two constructions, one of which would render the provision void and the other of which would render the provision valid, then the provision shall have the meaning which renders it valid. 10.10 Cooperation. The Parties recognize the necessity and hereby agree to cooperate with each other in carrying out the purposes of this Agreement. 10.11 Successors. This Agreement shall be binding upon and shall inure to the benefit of the successors of the Parties hereto. 10.12 Enforcement. The Authority is hereby authorized to take any and all legal or equitable actions, including, but not limited to, an injunction and specific performance, necessary or permitted by law to enforce this Agreement. 10.13 Integration. This Agreement constitutes the full and complete Agreement of the Parties. 10.14 Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original and all of which together shall constitute one and the same agreement. [Signatures on following page.] Page 509 of 512 ATTACHMENT 1 A JOINT EXERCISE OF POWERS AGREEMENT CREATING THE CENTRAL COAST BLUE REGIONAL RECYCLED WATER AUTHORITY 15 IN WITNESS WHEREOF, the Parties have caused this Joint Exercise of Powers Agreement to be executed and attested by their proper officers thereunto duly authorized on the day and year set forth below, making the same effective on the date signed by the last of all Parties hereto. CITY OF ARROYO GRANDE: CITY OF PISMO BEACH: By: Caren Ray Russom, Mayor Date: By: Ed Waage, Mayor Date: ATTEST: By: Jessica Matson, City Clerk Date: ATTEST: By: Erica Inderlied, City Clerk Date: APPROVED AS TO FORM: By: Timothy J. Carmel, City Attorney Date: APPROVED AS TO FORM: By: David M. Fleishman, City Attorney Date: CITY OF GROVER BEACH: By: Jeff Lee, Mayor Date: ATTEST: By: Wendi Sims, City Clerk Date: APPROVED AS TO FORM: By: David P. Hale, City Attorney Date: Page 510 of 512 ATTACHMENT 2 Attachment 2 - January 25, 2022 Staff Report relating to Cost Sharing Agreement is available as a link: https://pub-arroyogrande.escribemeetings.com/Meeting.aspx?Id=1d8cd654- ed8d-45c4-bfc0-95d7b21fc210&Agenda=Merged&lang=English&Item=68&Tab=attachments Page 511 of 512 ATTACHMENT 3 Attachment 3 - January 11, 2022 Staff Report and attachments is available as a link: https://pub-arroyogrande.escribemeetings.com/Meeting.aspx?Id=42d4e825-1f91-451a-af31- 6e17dfa546e0&Agenda=Agenda&lang=English&Item=41&Tab=attachments Page 512 of 512