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HomeMy WebLinkAbout2017-07-26 e-packet@7:00Wednesday, July 26, 2017 7:00 PM City of South San Francisco P.O. Box 711 South San Francisco, CA Municipal Services Building, Council Chambers 33 Arroyo Drive, South San Francisco, CA City Council Regular Meeting Agenda July 26, 2017City Council Regular Meeting Agenda PEOPLE OF SOUTH SAN FRANCISCO You are invited to offer your suggestions. In order that you may know our method of conducting Council business, we proceed as follows: The regular meetings of the City Council are held on the second and fourth Wednesday of each month at 7:00 p.m. in the Municipal Services Building, Council Chambers, 33 Arroyo Drive, South San Francisco, California. The City Clerk will read successively the items of business appearing on the Agenda. As she completes reading an item, it will be ready for Council action. PRADEEP GUPTA, Mayor LIZA NORMANDY, Vice Mayor KARYL MATSUMOTO, Councilwoman RICHARD A. GARBARINO, Councilman MARK ADDIEGO, Councilman FRANK RISSO, City Treasurer KRISTA MARTINELLI, City Clerk MIKE FUTRELL, City Manager JASON ROSENBERG, City Attorney PLEASE SILENCE CELL PHONES AND PAGERS HEARING ASSISTANCE EQUIPMENT AVAILABLE FOR USE BY THE HEARING IMPAIRED AT CITY COUNCIL MEETINGS In accordance with California Government Code Section 54957.5, any writing or document that is a public record, relates to an open session agenda item, and is distributed less than 72 hours prior to a regular meeting will be made available for public inspection in the City Clerk’s Office located at City Hall. If, however, the document or writing is not distributed until the regular meeting to which it relates, then the document or writing will be made available to the public at the location of the meeting, as listed on this agenda. The address of City Hall is 400 Grand Avenue, South San Francisco, California 94080. Page 2 City of South San Francisco Printed on 8/30/2017 July 26, 2017City Council Regular Meeting Agenda CALL TO ORDER ROLL CALL PLEDGE OF ALLEGIANCE AGENDA REVIEW PRESENTATIONS Certificate of Recognition honoring employee Jeri Ward for her years of service and dedication to the Parks and Recreation Department. (Rich Garbarino, Councilmember) 1. Library and Parks and Recreation Departments’ STEM Program. (Laura Armanino, Childcare Assistant Supervisor, Karla Bourdon, Literacy Program Manager, and Katie Levedahl, Director of Education, California Academy of Sciences) 2. Recognition of Natalie Cedeno for being named “2017 Mother of the Year” by Everything South City. (Liza Normandy, Vice Mayor) 3. PUBLIC COMMENTS COUNCIL COMMENTS/REQUESTS ADMINISTRATIVE BUSINESS Study session: cannabis - testing and manufacturing businesses. (Rozalynne Thompson, Associate Planner and Deborah Gill, Special Projects Manager) 4. Report regarding Measure W Community Civic Campus project quarterly update. (Marian Lee, Assistant City Manager and Dolores Montenegro, Kitchell Program Manager) 5. Report regarding a resolution authorizing the City Manager to execute an airspace lease for the South San Francisco Caltrain Station with the State of California Department of Transportation in an amount not to exceed $94,260 per year escalated at 3 percent annually for up to ten years to allow project improvements and use of Caltrans’ property within the US-101 freeway right-of-way. (Marian Lee, Assistant City Manager and Tony Rozzi, Senior Planner) 6. Resolution authorizing the City Manager to execute an airspace lease for the South San Francisco Caltrain Station with the State of California Department of Transportation in an amount not to exceed $94,260 per year escalated at 3 percent annually for up to ten years to allow project improvements and use of Caltrans property within the US-101 freeway right-of-way. 6a. Page 3 City of South San Francisco Printed on 8/30/2017 July 26, 2017City Council Regular Meeting Agenda Report regarding a resolution approving the application for grant funds to the California Natural Resources Agency Environmental Enhancement and Mitigation Program in a total amount of $500,000 for landscape enhancements to the Caltrain Station Improvement Project in Fiscal Year 2017-18. (Tony Rozzi, Senior Planner and Deborah Gill, Special Projects Manager) 7. Resolution approving the application for grant funds to the California Natural Resources Agency Environmental Enhancement and Mitigation Program in a total amount of $500,000 for landscape enhancements to the Caltrain Station Plaza Project in Fiscal Year 2017-18. 7a. Report regarding a resolution authorizing the City Manager to execute the Construction and Maintenance Agreement for the South San Francisco Caltrain Station with the Peninsula Corridor Joint Powers Board. (Marian Lee, Assistant City Manager and Tony Rozzi, Senior Planner) 8. Resolution authorizing the City Manager to execute the Construction and Maintenance Agreement for the South San Francisco Caltrain Station with the Peninsula Corridor Joint Powers Board. 8a. CONSENT CALENDAR Motion to approve the Minutes from the meeting of July 12, 2017.9. Motion confirming payment registers for July 26, 2017. (Richard Lee, Director of Finance) 10. Motion to cancel the Regular City Council meeting on August 23, 2017. (Mike Futrell, City Manager) 11. Report regarding a resolution authorizing the acceptance of $25,536 in grant funding from the San Mateo County Human Services Agency to support the Library and Parks and Recreation Departments’ Science Technology Engineering and Math education component of the After School Education and Safety programs and amending the Library Department’s Fiscal Year 2017-18 operating budget. (Valerie Sommer, Library Director) 12. Resolution authorizing the acceptance of $25,536 in grant funding from the San Mateo County Human Services Agency to support the Library and Parks and Recreation Departments’ Science Technology Engineering and Math education component of the After School Education and Safety programs and amending the Library Department’s Fiscal Year 2017 -18 operating budget. 12a. Page 4 City of South San Francisco Printed on 8/30/2017 July 26, 2017City Council Regular Meeting Agenda Report regarding a resolution authorizing the acceptance of $6,000 from the State of California, California Highway Patrol for the “Every 15 Minutes” Program and amending the Police Department’s Fiscal Year 2017-18 Operating Budget. (Jeff Azzopardi, Police Chief) 13. Resolution authorizing the acceptance of a $6,000 grant from the State of California, California Highway Patrol for the “Every 15 Minutes” Program and amending the Police Department’s Fiscal Year 2017-18 Operating Budget. 13a. A report regarding adoption of an ordinance to establish the Antoinette Lane Underground Utility District, CIP project no. st1702. (Sam Bautista, Principal Engineer) 14. Ordinance establishing the Antoinette Lane Underground Utility District, CIP Project st1702. 14a. Report regarding a resolution authorizing the acceptance of $29,000 in grant funding from the California State Library to support the Community Learning Center’s after-school program and amending the Library Department’s Fiscal Year 2017-18 Operating Budget. (Valerie Sommer, Library Director) 15. Resolution authorizing the acceptance of $29,000 in grant funding from the California State Library to support the Community Learning Center’s after-school program and amending the Library Department’s Fiscal Year 2017-18 Operating Budget. 15a. Report regarding a resolution authorizing the acceptance of $45,000 in grant funding from the Silicon Valley Community Foundation to support Project Read’s Financial Well-being program and amending the Library Department’s Fiscal Year 2017 - 18 operating budget. (Valerie Sommer, Library Director) 16. Resolution authorizing the acceptance of $45,000 in grant funding from the Silicon Valley Community Foundation to support Project Read’s Financial Well-being program and amending the Library Department’s Fiscal Year 2017-18 operating budget. 16a. ITEMS FROM COUNCIL – COMMITTEE REPORTS AND ANNOUNCEMENTS CLOSED SESSION Closed Session: Public Employee Performance Evaluation (Pursuant to Government Code Section 54957) Title: City Manager 17. Page 5 City of South San Francisco Printed on 8/30/2017 July 26, 2017City Council Regular Meeting Agenda Closed Session: Conference with Labor Negotiators (Pursuant to Government Code § 54957.6) Agency designated representatives: Pradeep Gupta, Mayor and Jason Rosenberg, City Attorney Unrepresented employee: City Manager 18. ADJOURNMENT Page 6 City of South San Francisco Printed on 8/30/2017 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-629 Agenda Date:7/26/2017 Version:1 Item #:1. Certificate of Recognition honoring employee Jeri Ward for her years of service and dedication to the Parks and Recreation Department.(Rich Garbarino, Councilmember) City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ CITY OF SOUTH SAN FRANCISCO Certificate of Recognition Jeri Ward The South San Francisco City Council does hereby congratulate Jeri Ward for her 39 years of dedicated, superior, and passionate customer service at Orange Park Pool. Her tireless and selfless actions as well as her boundless energy, friendliness, and kindness she exhibits each and every day are truly appreciated by the City of South San Francisco. Presented on this 26th day of July, 2017, by the City Council of South San Francisco Pradeep Gupta, Mayor Liza Normandy, Vice Mayor Mark Addiego, Councilmember Richard Garbarino, Councilmember Karyl Matsumoto, Councilmember City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-713 Agenda Date:7/26/2017 Version:1 Item #:2. Library and Parks and Recreation Departments’STEM Program.(Laura Armanino,Childcare Assistant Supervisor,Karla Bourdon,Literacy Program Manager,and Katie Levedahl,Director of Education,California Academy of Sciences) City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ ST E M   i n   S o u t h   S a n   F r a n c i s c o Ju l y   2 6 ,   2 0 1 7 A  p r o j e c t   o f   t h e   C i t y   o f   S o u t h   S a n   F r a n c i s c o   L i b r a r y   &   P a r k s   a n d  Re c r e a t i o n   D e p a r t m e n t s .   La u r a   A r m a n i n o Pa r k s   &   R e c r e a t i o n   D e p a r t m e n t ’ s   C h i l d c a r e   S u p e r v i s o r   Ka r l a   B o u r d o n So u t h   S a n   F r a n c i s c o   P u b l i c   L i b r a r y   M a n a g e r   f o r   L i t e r a c y   S e r v i c e s Ka t i e   L e v e d a h l Di r e c t o r   o f   E d u c a t i o n   a t   C a l i f o r n i a   A c a d e m y   o f   S c i e n c e s Co u n t y   G r a n t   • Ju l y   2 0 1 6   – J u n e   2 0 1 7 Co u n t y   G r a n t   • Ju l y   2 0 1 6   – J u n e   2 0 1 7 • Fo u r   c o m p o n e n t s : – Le t ’ s   t a l k   a b o u t   M a t h – Ma k e r S p a c e – Ha n d s ‐ o n   M i n d s ‐ o n – Fa m i l y   S T E M   e v e n t s  Mini Lessons  1‐on‐1 Help  Small Group  Workshops Co u n t y   G r a n t   • Ju l y   2 0 1 6   – J u n e   2 0 1 7 • Fo u r   c o m p o n e n t s : – Le t ’ s   t a l k   a b o u t   M a t h – Ma k e r S p a c e – Ha n d s ‐ o n   M i n d s ‐ o n – Fa m i l y   S T E M   e v e n t s  En g i n e e r i n g   P r o c e s s  Pr o b l e m ‐ S o l v i n g  Te c h n o l o g y   E x p o s u r e Co u n t y   G r a n t • Ju l y   2 0 1 6   – J u n e   2 0 1 7 • Fo u r   c o m p o n e n t s : – Le t ’ s   t a l k   a b o u t   M a t h – Ma k e r S p a c e – Ha n d s ‐ o n   M i n d s ‐ o n – Fa m i l y   S T E M   e v e n t s  Ou t d o o r   E x p l o r a t i o n   an d   C r e a t i v i t y  Sc i e n t i f i c   P r o c e s s Co u n t y   G r a n t   • Ju l y   2 0 1 6   – J u n e   2 0 1 7 • Fo u r   c o m p o n e n t s : – Le t ’ s   t a l k   a b o u t   M a t h – Ma k e r S p a c e – Ha n d s ‐ o n   M i n d s ‐ o n – Fa m i l y   S T E M   e v e n t s Em p o w e r   F a m i l i e s   &   In c r e a s e   A w a r e n e s s :  Cu r r i c u l u m   a n d   t o o l s  ST E M   c a r e e r s St e e r i n g   C o m m i t t e e ST E M ‐ R i c h   I n s t i t u t i o n s   Yo u t h   S e r v i n g   Or g a n i z a t i o n s Co m m u n i t y   P a r t n e r s So u t h   S a n   F r a n c i s c o Ba y A r e a S T E M Ec o s y s t e m Hi g h e r ‐ E d K‐12 Schools Th a n k   y o u ! La u r a   A r m a n i n o Pa r k s   &   R e c r e a t i o n   D e p a r t m e n t ’ s   C h i l d c a r e   S u p e r v i s o r   La u r a . A r m a n i n o @ s s f . n e t Ka r l a   B o u r d o n So u t h   S a n   F r a n c i s c o   P u b l i c   L i b r a r y   M a n a g e r   f o r   L i t e r a c y   S e r v i c e s bo u r d o n @ p l s i n f o . o r g Ka t i e   L e v e d a h l Di r e c t o r   o f   E d u c a t i o n   a t   C a l i f o r n i a   A c a d e m y   o f   S c i e n c e s Kl e v e d a h l @ c a l a c a d e m y . o r g City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-722 Agenda Date:7/26/2017 Version:1 Item #:3. Recognition of Natalie Cedeno for being named “2017 Mother of the Year” by Everything South City.(Liza Normandy, Vice Mayor) City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ CITY OF SOUTH SAN FRANCISCO Certificate of Recognition Natalie Cedeno The South San Francisco City Council does hereby congratulate Natalie Cedeno for being named “2017 Mother of the Year” by Everything South City. Your dedication and commitment as a loving mother of four children is truly valued by the City of South San Francisco. Presented on this 26th day of July, 2017, by the City Council of South San Francisco Pradeep Gupta, Mayor Liza Normandy, Vice Mayor Mark Addiego, Councilmember Richard Garbarino, Councilmember Karyl Matsumoto, Councilmember City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. Study session:cannabis -testing and manufacturing businesses.(Rozalynne Thompson,Associate Planner and Deborah Gill, Special Projects Manager) RECOMMENDATION It is recommended that the City Council hold a study session on potential testing and manufacturing cannabis businesses within the City, and provide direction to staff regarding next steps. BACKGROUND/DISCUSSION On November 8,2016,California voters approved Proposition 64,which is the initiative known as the Adult Use of Marijuana Act (AUMA).Subject to local and state restrictions and regulations,AUMA generally legalizes the nonmedical, recreational use of cannabis by persons 21 years of age and over. AUMA created a comprehensive state regulatory and licensing structure governing commercial nonmedical cannabis activities,including the commercial cultivation,testing,manufacturing,distribution,and retail sale of nonmedical cannabis. On April 4,2017,Governor Brown released a budget trailer bill (“Trailer Bill”)that aimed to reconcile the existing medical marijuana statutory framework under the Medical Marijuana Regulation and Safety Act (MMRSA)and the recreational statutory framework adopted under the AUMA.After some revision,the state Senate and Assembly passed a modified version of the original proposal in the form of AB 110/SB 94 on June 15th and the Governor signed it into law. Some important elements of the Trailer Bill include: •Permits co-location of medical and adult-use commercial facilities-Medical and adult-use commercial facilities may be located on the same premises,so long as licensees obtain separate medical and non- medical licenses for each use. •Preservation of the state Medical ID Card-Many cities were pleased with this element of the Trailer Bill because jurisdictions were concerned that elimination of this requirement would encourage individuals to migrate to medical cannabis to avoid paying sales and use tax, regardless of why they use cannabis •Permits non-storefront retailers-Non-storefront retail operations are permitted.Under this category of use,licensees must have licensed physical locations,but such locations may be closed to the public with all sales conducted exclusively by delivery. •Fire and safety standards-The Trailer Bill includes language clarifying that local fire officials retain authority to carry out fire and life-safety requirements. •Local Control-The Trailer Bill includes language specifying that it shall not be interpreted to supersede or limit the authority of local jurisdictions to adopt and enforce local ordinances to regulate state- City of South San Francisco Printed on 8/30/2017Page 1 of 9 powered by Legistar™ File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. or limit the authority of local jurisdictions to adopt and enforce local ordinances to regulate state- licensed businesses,including,but not limited to,local zoning and land use requirements,business license requirements,and requirements related to reducing exposure to secondhand smoke,or to completely prohibit the establishment or operation of one or more types of state-licensed businesses within local jurisdictions. •Residency Requirements-The Trailer Bill eliminated the California residency requirement for commercial cannabis licensees. •Local verification process-Local jurisdictions are required to provide the Bureau of Cannabis Control with a copy of any local ordinances regulating commercial cannabis and the name of a contact person to serve as liaison between the state licensing entities and the local jurisdiction. On January 25,2017,the City Council adopted an interim urgency ordinance placing a moratorium on all commercial cannabis activity within the City of South San Francisco in order to comprehensively study the issue. On March 8, 2017, the City Council extended the moratorium for an additional ten months and 15 days. On January 11,2017 City Council held a study session on an overview and update on cannabis laws.Retailer dispensary licenses (Type 10)were discussed at the April 12,2017 City Council study session.The focus of this study session is the potential regulation of testing and manufacturing cannabis businesses,state license types 6, 7, and 8. If the City Council determines to regulate rather than prohibit cannabis businesses,the following are some topics staff recommends for City Council consideration regarding cannabis manufacturing and testing: •Would testing and manufacturing be allowed in the city? And if yes, in which zones? •Would businesses be allowed within the biotech core? •Would the city require businesses locate at a minimum distance from each other, or from sensitive uses? •Would the City impose limits to the size of operations? •What ventilation,noise,odor,lighting,electrical,water,security and other operational standards should be imposed to address fire and safety concerns? State Licenses State cannabis manufacturing is defined as to compound,blend,extract,infuse,or otherwise make or prepare a cannabis product. There are two types of licenses: •Type 6 =Manufacturer 1,sites that manufacture cannabis products using nonvolatile solvents,or no solvents, and •Type 7 = Manufacturer 2, sites that manufacture cannabis products using volatile solvents. State testing licenses (Type 8)are independent licensed testing laboratories that acquire batch samples of cannabis and cannabis products from distributors prior to retail sale and tests them for: •Whether the chemical profile of the sample conforms to the labeled content of cannabis compounds, and •The presence of contaminants does not exceed the levels in the most current version of the American Herbal Pharmacopoeia monograph. City of South San Francisco Printed on 8/30/2017Page 2 of 9 powered by Legistar™ File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. Under the Trailer Bill vertical integration,or having more than one license,is generally allowed with the exception of testing and large cultivation.Testing facilities cannot hold any other license under the Trailer Bill. In addition, large cultivation licensees cannot hold distributor or microbusiness licenses Land Use Controls . Based on research of cannabis-related business regulations of several jurisdictions in Colorado,Washington, Oregon,and California,the common land use mechanisms used to regulate cannabis manufacturing and testing businesses are siting limitations (zoning),space and distance requirements,and operational standards.Each land use control is outlined below. Zoning - Manufacturing Section 20.620.005 of the South San Francisco Municipal Code would include cannabis manufacturing with the “General Industry”use classification,which is the “manufacturing of products from extracted or raw materials or recycled or secondary materials,or bulk storage and handling of such products and materials.”Cannabis manufacturers produce a variety of goods that contain cannabis including baked goods,candies,beverages,oil, lotions,and capsules.The manufacturers produce these products by extracting various substances from cannabis plants. Staff recommends that it would be appropriate to allow manufacturing of cannabis and cannabis-infused products in the same zones that other manufacturing is permitted.The only zoning districts that cannabis manufacturing uses could be located is within the Mixed Industrial (MI)zoning district and the Business Professional Office (BPO) zoning district. The Trailer Bill requires that commercial cannabis businesses locate at least 600 feet from K-12 schools,day care centers,or youth centers that are in existence at the time the license is issued.Please see Attachment 1, which shows a map of the city indicating the MI and BPO zoning districts with areas excluded according to the Trailer Bill, and Attachment 2, which shows suggested cannabis manufacturing zones. Zoning - Testing Under the Trailer Bill,cannabis testing facilities would test samples of cannabis grown in California as well as analyze and certify the safety and potency of cannabis.Under the Municipal Code,cannabis testing facilities would be classified under the “Research and Development”use classification,which is “a facility for scientific research and the design,development,and testing of electrical,electronic,magnetic,optical,pharmaceutical, chemical, and biotechnology components and products in advance of product manufacturing.” “Research and Development”uses are currently allowed in the Business Commercial (BC),Business Professional Office (BPO),Business Technology Park (BTP),Bay West Cove Specific Plan District (BWCSPD),Downtown Transit Core (DTC),El Camino Real Mixed Use (ECRMX),El Camino Real/Chestnut Mixed Use,High Density (ECR/C-MXH),El Camino Real/Chestnut Mixed Use,Medium Density (ECR/C-MXM),ECR/C-MXM,Gateway Specific Plan (GSPD),Grand Avenue Core (GAC),Linden Commercial Corridor (LCC),Linden Neighborhood Center (LNC),Mixed Industrial (MI),Oyster Point City of South San Francisco Printed on 8/30/2017Page 3 of 9 powered by Legistar™ File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. Commercial Corridor (LCC),Linden Neighborhood Center (LNC),Mixed Industrial (MI),Oyster Point Specific Plan District (OPSD),Terra Bay Specific Plan District (TSPD),and the Transit Office/R&D Core (TO/RD) zoning districts. Staff suggests allowing cannabis testing facilities in zones that do not contain residential areas:BC,BPO,BTP, BWCSPD,GSPD,MI,and portions of the OPSD zoning districts.Please see Attachment 3,which shows City testing zones excluding BC,BPO,BTP,BWCSPD,GSPD,MI,and portions of the OPSD zoning districts,with areas excluded according to the Trailer Bill.Please also see Attachment 4,which shows a map of the city indicating which zoning areas are suggested,with certain areas excluded in accordance with the restrictions in the Trailer Bill. Space and Distance Requirements - Manufacturing and Testing Staff would recommend that manufacturing facilities could be located in areas indicated in Attachment 2. These zoning districts have historically encompassed similar manufacturing uses. In terms of public safety,staff does not have any concerns for testing facilities as long as they adhere to security standards and have limited product. Size of Operations for Manufacturing and Testing Most of the cities in California,Colorado,Oregon,and Washington surveyed do not have a size limit for cannabis manufacturing and testing facilities.Those that do have size limitations range from 2,000 to 6,400 square feet by right;if a manufacturing or testing facility is allowed to exceed the by right limitation,it is done through a Conditional Use Permit process.It is unclear how much square footage each manufacturing or testing facility will need,because of the wide variety of cannabis products that can be manufactured and the equipment necessary for testing facilities,with each having different space requirements.Rather than set a limit on the square footage,staff recommends that the square footage for each manufacturing and testing facility should be determined through the development standards in the Zoning Ordinance and a discretionary review process.Applicants will be required to submit a business plan as well as a detailed floor plan that outlines their space needs,including manufacturing,storage,kitchen,packaging,shipping,equipment,and office areas. Operational Standards for Manufacturing and Testing Operational standards typically involve specific requirements designed to mitigate impacts of a particular use on surrounding properties.The following operational standards for manufacturing and testing facilities may be considered: •Conducting background checks of the business operators and their employees •Requiring extensive security measures, •Requiring a ventilation system to control and contain odors •Manufacturing must be within a fully enclosed building and must not be visible from the public right-of -way, •The manufacturing must comply with all applicable state and local laws, and •Abide by same requirements that are placed on other manufacturers and testing facilities in the zoning City of South San Francisco Printed on 8/30/2017Page 4 of 9 powered by Legistar™ File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. districts where such uses are permitted. Fire/Building Codes In manufacturing cannabis products,there are two classifications:using nonvolatile solvents or no solvents (Type 6),or manufacturing products using volatile solvents (Type 7).Non-solvent extraction or non-volatile extractions include processes such as: •Mechanical extraction using screens or presses •Non-volatile chemical extraction such as water,vegetable glycerin,vegetable oils,animal fats,or food- grade glycerin Solvent processes used to extract cannabis include: •Chemical extraction using a professional closed loop CO2 gas extraction systems •Chemical extraction using a volatile solvent such as n-butane (hydrocarbons,which includes butane and propane) and ethanol; is volatile and flammable In the Trailer Bill,manufacture of cannabis products is generally permitted if it is done using non-toxic,non- flammable,or solventless processes.If a manufacturing process utilizes volatile solvents,then it is only permitted if it is conducted exclusively within a closed-loop system that meets all of the following requirements: i.The system uses only solvents that are generally recognized as safe pursuant to the federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 301 et seq.). ii.The system is designed to recapture and contain solvents during the manufacturing process,and otherwise prevent the off-gassing of solvents into the ambient atmosphere to mitigate the risks of ignition and explosion during the manufacturing process. iii.A licensed engineer certifies that the system was commercially manufactured,safe for its intended use,and built to codes of recognized and generally accepted good engineering practices, including,but not limited to,the American Society of Mechanical Engineers (ASME),the American National Standards Institute (ANSI),Underwriters Laboratories (UL),the American Society for Testing and Materials (ASTM), or OSHA Nationally Recognized Testing Laboratories (NRTLs). iv.The system has a certification document that contains the signature and stamp of a professional engineer and the serial number of the extraction unit being certified. In Washington,extraction equipment certification requires an engineer peer review (EPR).An EPR is a certification from a licensed engineer who meticulously reviews the equipment in question for safety, functionality and to ensure it meets applicable national safety codes.Other states like Colorado and Nevada also require similar EPR reports,with the city of Denver having the most meticulous compliance requirements in the nation.Staff would recommend additional safety requirements similar to Washington’s be required for all manufacturing equipment if manufacturing were to be permitted in the City. For hydrocarbons,staff would recommend facilities have a separate room for running a light hydrocarbon extractor,with spark-proof ventilation,electrical and fireproofing that conforms with National Fire Protection Association code,as well as a Underwriters’Laboratories (UL)listing classification and the above mentioned City of South San Francisco Printed on 8/30/2017Page 5 of 9 powered by Legistar™ File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. Association code,as well as a Underwriters’Laboratories (UL)listing classification and the above mentioned EPR. The building and fire code requirements for manufacturing cannabis will be based on current codes at the time the application has been filed.A business license application that satisfies the requirements of the City will be reviewed and upon the completion of the review the occupancy classification will be determined by the Chief Building Official.According to the California Building Code,both volatile and non-volatile cannabis manufacturing would likely fall under F1 -moderate hazard factory industrial.It is similar to the use of manufacturing of hemp and tobacco products, where hazardous materials are kept within a closed system. The building and fire code requirements for cannabis testing facilities would be different than manufacturing facilities.The likely quantity of hazardous materials is probably going to be relatively low and similar to that found in laboratory type uses,similar to those found in biotech companies.Therefore,staff would consider this use similar to that of L occupancy (Laboratory use).L occupancies allow slightly higher amounts of hazardous materials than B occupancies,like an office,but much less than that of H occupancy,which allows a far greater amount of hazardous materials.Staff has no building code or safety concerns for testing facilities,as long as the business’building would be suitable for its intended use,e.g.laboratory space,and adheres to building and fire codes. Security The City could require cannabis businesses to submit a security plan for review by the Chief of Police as part of the permitting process. Other security measures that could be considered are the following: •Video cameras •Alarms •Lighting •Safes •Hired on and off-site security, including a minimum number of security officers •Updated window, door, and skylight standards •Limiting amount of product Staff recommends mandating ventilation systems and prohibiting physical and online signage advertising the location of a cannabis manufacturing or testing facility to the general public.Discouraging public facing signage for manufacturing and testing cannabis businesses would be possible through performance standards adopted by ordinance. Examples include: -No on-street signage or other building markings, -No signage on vehicles, and -No physical addresses on websites,business cards,and promotional materials (could say something like “located in South San Francisco, serving South San Francisco…”, or list a P.O Box) State cannabis licenses will be valid for one year.Staff recommends that local approvals also be valid for one year at a time.The City can add performance standards,when if not met would prevent re-issuing of a license. State regulation also requires the implementation of a track and trace program which includes an electronic City of South San Francisco Printed on 8/30/2017Page 6 of 9 powered by Legistar™ File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. State regulation also requires the implementation of a track and trace program which includes an electronic seed to sale software tracking system with data points for the different stages of commercial activity including, but not limited to, cultivation, harvest, processing, distribution, inventory, and sale. Testing Specific Standards Licensed cannabis operators are authorized to have in-house (non-Type 8)testing laboratories to provide testing of cannabis and cannabis products obtained from third party cannabis cultivators and manufacturers before those products are sent to Type 8 testing laboratory for final, presale quality assurance. The Trailer Bill requires product testing by independent testing labs for labeled content of cannabis compounds and contaminants (such as pesticides and mold),a chain of custody protocols,and use of standard operating procedures to confirm or refute bad test results.Remains of the testing samples are required to be destroyed, and a lab is required to notify the Bureau of Cannabis Regulation within 24 hours of any change in the testing lab’s accreditation. Testing laboratories would be able to test both medical and adult-use cannabis. Under the Trailer Bill,the responsibility for testing cannabis or cannabis product falls on the licensee taking the product to market.In terms of food safety issues for the manufactured products,the Trailer Bill states The Department of Public Health will license and oversee manufacturing and testing,ensuring consumers receive a safe product. FUNDING California State Taxes Effective January 1,2018,all retail sales,medical and non-medical,will be subject to a 15 percent California state excise tax. Tax revenues will be allocated to the California Marijuana Tax Fund where proceeds will be directed towards repaying State agencies for regulatory costs not covered by license fees,and providing grants to California public universities to study and evaluate the implementation of the act.Remaining tax revenues will be distributed: ·60 percent to youth programs, substance abuse education, prevention and treatment ·20 percent to environmental cleanup and remediation; and ·20 percent to programs to reduce DUIs and negative health and safety impacts resulting from cannabis legislation State cannabis tax revenue grants will be distributed to those localities where cannabis businesses are permitted, even though effects of legalization may occur in other localities as well. Local Taxes In addition to California state and local sales tax of 9.25 percent,and California state 15 percent excise tax, county and local jurisdictions can choose to enact an additional local tax on cannabis.A local general cannabis tax would require a public hearing of the ordinance and voter approval,requiring 2/3 approval from City Council and 50 percent plus one of a ballot vote.As discussed below,jurisdictions also have the opportunity to City of South San Francisco Printed on 8/30/2017Page 7 of 9 powered by Legistar™ File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. Council and 50 percent plus one of a ballot vote.As discussed below,jurisdictions also have the opportunity to impose fees on cannabis businesses to help alleviate the cost burdens on jurisdictions for regulating these types of businesses,including the costs of audits,inspections,and processing licenses.Fees cannot exceed the reasonable costs to the City of regulating these types of businesses. Local Manufacturing or Testing Tax Many localities impose a cannabis tax on gross receipts for cannabis businesses.A few examples from other localities are: ·Monterey County -5 percent gross-receipts tax on all operations in the business of distributing, manufacturing and testing cannabis ·Sonoma County - 10 percent for all cannabis businesses in unincorporated sections of the county ·Santa Rosa - a maximum rate of 8 percent on all cannabis businesses ·Watsonville - 2.5 percent for manufacture or processing of cannabis, 10 percent for sale ·Santa Cruz - initial rate of 7 percent on cannabis businesses, a maximum rate of 10 percent ·San Leandro - 10 percent on all cannabis businesses ·Hayward - a maximum rate of 15 percent on all cannabis businesses ·Richmond - 10 percent on all cannabis businesses ·Sacramento -subject to the City’s standard 4 percent business tax,not including the licensing fee and conditional use permit described below,as well as a neighborhood impact fee,which will be established by a development impact fee study Colorado,Washington,and Oregon have lowered their cannabis tax rates after their initial rates did not sufficiently reduce the black market.Staff recommends commissioning a study in order to calculate a fair tax rate that would not promote the black market.Council may consider a cannabis impact fee to be more appropriate than a local cannabis tax that would be in addition to the local sales tax;in which case,staff would recommend an impact fee study to determine the fee. Local Manufacturing or Testing Business License Fee The City has the option to create a special business license permit fee for manufacturing and testing cannabis businesses.A local cannabis business license permit fee would require 2/3 approval from City Council,public noticing of the fees,and supportive documentation outlining the City costs justifying imposition of the fee.If the City were to move forward,staff would recommend commissioning a study in order to calculate the total cost burden of providing legal,building inspection,code enforcement,finance,fire,and police support in the City for all potential cannabis businesses before a final cost allocation recommendation per license type. For example,testing facilities will have minimal amounts of cannabis on site.This is estimated to draw less on City administrative and enforcement resources,and consequently will likely result in a lower business license fee compared to manufacturing if a framework is put in place. City of South San Francisco Printed on 8/30/2017Page 8 of 9 powered by Legistar™ File #:17-188 Agenda Date:7/26/2017 Version:2 Item #:4. Other jurisdictions have also imposed a cannabis business license fee, or are planning to: ·Monterey County has assessed a permit fee of $8,200 -$9,000,to be distributed to various agencies according to cost burden (Public Works, Planning, Environmental Services, etc.) ·Sacramento -$30,900 for non-volatile manufacturing,$15,870 for testing,as well as a conditional use permit, the cost of which ranges from $16,640 to $33,610 ·San Francisco -has established an Office of Cannabis and is planning to have an ordinance set in place by September 1, 2017, with fees set in place by December 1,2017. ·Denver - $7,500 for new manufacturing license fee, $5,500 for testing ·Las Vegas -$25,000 manufacturing permit,$10,000 testing permit plus an additional $5,000 compliance permit and $1,280 special use permit for both usage types Attachments ·Attachment 1 - Map, manufacturing zones with Trailer Bill areas excluded ·Attachment 2 - Map, suggested cannabis manufacturing zones ·Attachment 3 - Map, testing zones that do not contain residential, with Trailer Bill areas excluded ·Attachment 4 - Map, suggested cannabis testing zones ·Attachment 5 - Powerpoint presentation City of South San Francisco Printed on 8/30/2017Page 9 of 9 powered by Legistar™ S H A W UTAH CANAL SISTER C I T I E S DNA E GRAND S M A P L E GAT E W A Y S A I R P O R T GRAN D V I E W S L I N D E N ALL E R T O N ECCL E S FORBE S ARRO Y O GRAND S SP R U C E MI S S I O N ORA N G E LITTLEFI E L D MITCHELL AIR P O R T RAILROA D HILLSIDE MILLER OYSTER POINT MA P L E Manufacturing Zones ELCA MIN O R E A L Areas within MI/BPO zones more than 600 feet from Schools, Day Cares, and Youth CentersSchools, Day Cares, and Youth Centers HIG H W A Y 101 I N T E R S T A TE 380 Areas within GMP zone more than 600 feet from Schools, Day Cares, and Youth Centers S H A W U T A H CANAL SISTER CITIES DNA E GRAND S MAPLE GATEWAY S A I R P O R T G R A N D VIE W S LINDEN ALLERTON E C C LE S F O R B E S A R R O Y O GRAND S SPRUCE MISSIO N ORANGE L I T T L E F I E L D MITCHELL AIRPORT RAILROAD H I L L S I D E MILLER OYSTE R PO IN T MAPLE Suggested Cannabis Manufacturing Zones ELCA MIN O R E A L Areas within Manufacturing Zones more than 600 feet from Schools, Day Cares, and Youth CentersSchools, Day Cares, and Youth Centers HIG H W A Y 101 I N T E R S T A TE 380 WESTBO R O U G H S H A W UTAH CANAL SISTER C I T I E S DNA E GRAND S M A P L E GAT E W A Y S A I R P O R T GRAN D V I E W S L I N D E N ALL E R T O N ECCL E S FORBE S ARRO Y O GRAND S SP R U C E MI S S I O N ORA N G E LITTLEFI E L D MITCHELL AIR P O R T RAILROA D HILLSIDE MILLER OYSTER POINT MA P L E Testing Zones ELCA MIN O R E A L Areas within BC/BPO/BTP/BWCSPD/GSPD/MI/OPSD/TO RD zones more than 600 feet from Schools, Day Cares, and Youth CentersSchools, Day Cares, and Youth Centers HIG H W A Y 101 I N T E R S T A TE 380 Areas within GMP zone more than 600 feet from Schools, Day Cares, and Youth Centers WESTBOROUG H S H A W U T A H CANAL SISTER CITIES DNA E GRAND S MAPLE GATEWAY S A I R P O R T G R A N D VIE W S LINDEN ALLERTON E C C LE S F O R B E S A R R O Y O GRAND S SPRUCE MISSIO N ORANGE L I T T L E F I E L D MITCHELL AIRPORT RAILROAD H I L L S I D E MILLER OY ST ER POI NT MAPLE Suggested Cannabis Testing Zones ELCA MIN O R E A L Areas within Testing Zones more than 600 feet from Schools, Day Cares, and Youth CentersSchools, Day Cares, and Youth Centers HIG H W A Y 101 I N T E R S T A TE 380 Study Session: Regulating Manufacturing and Testing Cannabis Businesses Citywide Rozalynne Thompson, Planning Division Deborah Gill, Office of the City Manager Timeline 2017 •January – General Overview •March – Moratorium •April – Retail Study Session •July – Manufacturing and Testing Study Session •September – Cultivation and Distribution Study Session •October – Consider ordinances Cannabis Manufacturing To compound, blend, extract, infuse, or otherwise make or prepare a cannabis product Cannabis Testing Independent licensed testing laboratories test cannabis samples and products for cannabis compounds and contaminants Local Cannabis Regulation Topics to consider in City manufacturing and testing regulation: •Land Use Controls •Fire/Building codes •Security •Taxation and Fees Land Use Controls Land Use Controls Zoning •Allows Manufacturing and Testing •Remote from residential Distance •At least 600 feet from schools, day care centers, youth centers Size •Can regulate through Conditional Use Permit Map showing manufacturing zones excluding AUMA exluded areas Map showing testing areas excluding AUMA excluded areas Map showing testing areas excluding AUMA excluded areas Map showing testing areas excluding AUMA excluded areas Land Use Controls - Operational Standards •Background checks •Ventilation systems •Manufacturing fully enclosed and not visible from public right-of-way Fire & Building Codes Operational Standards Fire/Building Codes •Manufacturing •State law •Engineer Peer Review •Specific standards for hydrocarbons •Moderate hazard - factory & industrial codes •Testing – laboratory buildings codes Security Operational Standards Security •Alarms •Safes •Lighting •Video cameras •On-site security •Limited amount of product •Updated window, door and skylight standards •No public facing signage Financial Impact: Licensing and Taxation California Taxation In addition to: •State and local sales tax of 9.25% •State 15% excise tax Local jurisdictions can impose taxes and fees City Taxes and Fees Cannabis taxes – range from 0% to 15% Fees - to cover City’s cost burden of administration and enforcement •Business permit – varies by type, ranges from $5,500 to $30,900 •Impact fee •Conditional Use Permit Questions for Discussion •Do we allow manufacturing and testing? •If yes, in which zones? •Any distance requirements between businesses? •What controls should be in place (operations, fire and safety, signage, size, ventilation, noise, odor, lighting electrical, water)? City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-567 Agenda Date:7/26/2017 Version:1 Item #:5. Report regarding Measure W Community Civic Campus project quarterly update.(Marian Lee,Assistant City Manager and Dolores Montenegro, Kitchell Program Manager) RECOMMENDATION It is recommended that the City Council review the information in this staff report.This is an information item. There are no actions for consideration at this time. BACKGROUND/DISCUSSION This is an information item providing an update on the Community Civic Campus project between April 2017 and June 2017, Quarter 4 of Fiscal Year 2016-17. Master Architect Procurement Kitchell spent considerable time preparing Request for Qualifications (RFQ)materials for a Master Campus Architect firm/team. The scope of services for the firm/team to be selected includes: ·Completing the campus master plan; ·Final programming of the buildings; ·Preparing design documents; ·Preparing basis of design and/or criteria documents (if needed); ·Preparing a circulation/access plan; and ·Community/stakeholder outreach including conducting public design charrettes. The RFQ was issued June 12,2017 and proposals received July 14,2017.Review of all submittals is currently underway.A shortlist of qualified firms/teams will be identified and to those firms,a Request for Proposal (RFP)will be issued.Recommendations on the selected firm/team will brought back to the full council for consideration and approval in October/November 2017. California Environmental Quality Act (CEQA) The Draft Supplemental Environmental Impact Report (DSEIR)was released for public review July 12,2017. The DSEIR is posted on the state registrar and was distributed to appropriate state and local government agencies as required by CEQA. Within the City, the DSEIR was distributed to: ·City Council ·Measure W Citizen’s Oversight Committee ·Planning Commission ·Park and Recreation Commission ·Library Commission City of South San Francisco Printed on 8/30/2017Page 1 of 3 powered by Legistar™ File #:17-567 Agenda Date:7/26/2017 Version:1 Item #:5. ·Bike and Pedestrian Committee The DSEIR was also posted on the City’s website and sent to the Measure W mailing distribution list.Hard copies are also available at the Annex as well as the Library. Comments on the DSEIR are due August 28,2017 and should be sent in writing via mail or email to Tony Rozzi (315 Maple Avenue,SSF CA.94080 or [email protected]).Comments will be evaluated and addressed in the Final Supplemental Environmental Report (FSEIR)which is scheduled to be completed by October 2017. City Council will be asked to certify the document in November 2017, based on current schedule. Additional Updates City Council,at the June 14,2017 meeting,approved the offer to the Oversight Board for three key parcels needed for the project.At the July 18,2017 Oversight Board meeting,the Oversight Board ratified the offer by adopting a resolution approving the sale.Agreements related to obtaining the remaining properties (Kaiser and Bay Area Rapid Transit) will be the project team’s focus over the next six months. The Citizen’s Oversight Committee did not meet in June 2017.As a result,the project team will present both the Quarter 3 and Quarter 4 updates at their next regularly scheduled meeting on August 2, 2017. The project procedures manual,as well as the conceptual master project schedule is complete.These deliverables serve as program management tools for the project team to guide day-to-day activities and processes, and manage the project budget and key milestones. Upcoming Milestones During the upcoming quarter, the project team will focus on: ·Shortlisting the master architect firms/teams, issuing the RFP and conducting interviews ·Conducting additional environmental and geotechnical due diligence ·Advancing the Antoinette Underground Utility District ·Preparing the Final Supplemental Environmental Impact Report (FSEIR) ·Preparing key terms/draft agreements related to the Kaiser and BART properties Attachment 1 is a power point presentation that summarizing milestones achieved and target milestones anticipated over the next several months. Budget / Service Agreements The total Fiscal Year 2016-17 budget approved by City Council is $2.5 million.For Fiscal Year 2016-17, $680,000 was committed for project specific tasks.In Quarter 4,$181,648 was expended.Remaining funds will be carried over in Fiscal Year 2017 -18 and with additional funds approved by City Council as part of the Fiscal Year 2017-18 budget; there is sufficient funding for the anticipated project tasks to come. City of South San Francisco Printed on 8/30/2017Page 2 of 3 powered by Legistar™ File #:17-567 Agenda Date:7/26/2017 Version:1 Item #:5. See Attachment 2 for the budget summary and listing of active service agreements. FUNDING There is no funding impact. CONCLUSION The next quarterly update for City Council will be in October 2017. Attachments: 1.Presentation on Community Civic Campus Project Update (Quarter 4, 2017) 2.Community Civic Campus Budget, Expense and Contract Report (Quarter 4, 2017) City of South San Francisco Printed on 8/30/2017Page 3 of 3 powered by Legistar™ MEASURE W –COMMUNITY CIVIC CAMPUS City Council Meeting –July 26, 2017 Prepared by Kitchell CEM MASTER ARCHITECT PROCUREMENT •Finalized and issued RFQ Architectural Services •Scope:–Campus Master Plan –100% design for joint Library and Recreation building –Schematic/criteria documents for Police and Fire buildings –Circulation and access plan –Community stakeholder outreach including public charrettes MEASURE W –COMMUNITY CIVIC CAMPUS CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) •Notice of Preparation (NOP) released -March 3, 107 •Draft Supplemental Environmental Impact Report (DSEIR) -released July 12, 2017 •DSEIR comments due -August 28, 2017 •Final Supplemental Environmental Impact Report to be released –October, 2017 •City Council Certification –November, 2017 MEASURE W –COMMUNITY CIVIC CAMPUS ADDITIONAL UPDATES •Purchase key project parcels from Oversight Board •Completed Project Procedures Manual and Master Schedule MEASURE W –COMMUNITY CIVIC CAMPUS $324,651.74 $501,895.18 $633,385.18 $680,001.18 $43,324.42 $108,033.91 $147,825.91 $329,473.62 $- $500,000.00 $1,000,000.00 $1,500,000.00 $2,000,000.00 $2,500,000.00 $3,000,000.00 2017-Q1 2017-Q2 2017-Q3 2017-Q4 Measure W -Budget Vs. Commitment Vs. Expended Up to 06/30/17 Approved Budget Committed Expended MEASURE W –COMMUNITY CIVIC CAMPUS Project Budget MEASURE W –COMMUNITY CIVIC CAMPUS Q1-2017/2018 TARGET MILESTONES •August 2,2017 Meeting with Citizen’s Oversight Committee •Shortlist master architect firms/teams, issue RFP and conducting interviews •Additional environmental and geotechnical due diligence •Advance Antoinette underground utility project •Preparing the FSEIR •Preparing key terms/draft agreements related to the Kaiser andBARTproperties Attachment 2 Measure W – Community Civic Campus Quarter 4 2017 Report The total FY 2016-2017 budget approved by City Council is $2.5 million. For FY 2016-2017, $680,001 has been committed for project specific tasks. For Quarter 4, $181,648 was expended. See Table 1 below for more detailed information. Numbers are rounded to the nearest dollar and explains minor discrepancies in totals. TABLE 1 2016/2017 Budget 2016/2017 Committed Q4 Expended Q1, Q2, Q3 Expended Committed minus Expended Financial - Bond Management 100,000 81,724 81,724 Subtotal 100,000 81,724 81,724 Pre-Design - Traffic 70,000 71,484 34,968 36,517 - Environmental 200,000 115,788 88,861 26,927 - Appraisals / Offers 200,000 6,800 700 6,100 - Site Survey 100,000 22,072 10,582 11,490 - Site Planning 200,000 197,395 7,471 61,755 128,168 - Not Programmed 330,000 Subtotal 1,100,000 413,540 97,033 107,305 209,202 Program Management - PM Contract 750,000 184,008 84,615 39,792 59,601 - Outreach 200,000 - Office Supplies 5,000 729 729 - Not Programmed 345,000 Subtotal 1,300,000 184,737 84,615 40,521 59,601 TOTAL $2,500,000 $680,001 $181,648 $147,826 $350,527 Figure 1 provides a visual of the summary information in Table 1 - funding committed to work tasks and expended amounts to date relative to the budget approved for FY16-17. The committed and expended are below the approved budget. This graph (over time) will show at-a-glance the pace of spending and confirm commitments remaining within the approved budget. Figure 1 $324,651.74 $501,895.18 $633,385.18 $680,001.18 $43,324.42 $108,033.91 $147,825.91 $329,473.62 $- $500,000.00 $1,000,000.00 $1,500,000.00 $2,000,000.00 $2,500,000.00 $3,000,000.00 2017-Q1 2017-Q2 2017-Q3 2017-Q4 Measure W -Budget Vs. Commitment Vs. Expended Up to 06/30/17 Approved Budget Committed Expended There are several consultant contracts in place to support the project work. Table 2 provides a list of the contractors that have and are providing a range of specialty services for this project. Highlighted in blue are active contracts. Table 2 Firm / Consultant Service Type Amount Approved Public Financial Management Financial $81,724 Nelson and Nygaard Traffic $3,804 Kimley Horn Traffic $67,680 Michael Baker CEQA $115,788 CSS Environmental Environmental $6,100 Schaaf & Wheeler Engineering $6,260 Sandis Engineering $8,750 Wilsey Ham Engineering $4,202 Exaro Engineering $2,860 Group 4 Planning $195,100 Mack 5 Cost Estimating $2,295 Kitchell Program Management $184,008 Watts, Cohn & Partners Inc. Appraisals $7000 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-549 Agenda Date:7/26/2017 Version:1 Item #:6. Report regarding a resolution authorizing the City Manager to execute an airspace lease for the South San Francisco Caltrain Station with the State of California Department of Transportation in an amount not to exceed $94,260 per year escalated at 3 percent annually for up to ten years to allow project improvements and use of Caltrans’property within the US-101 freeway right-of-way.(Marian Lee,Assistant City Manager and Tony Rozzi, Senior Planner) RECOMMENDATION It is recommended that the City Council adopt a resolution authorizing the City Manager to execute an airspace lease with the State of California Department of Transportation in an amount not to exceed $94,260 per year escalated at three percent annually for up to ten years to allow project improvements, and use of Caltrans’ property within the US-101 freeway right-of-way. BACKGROUND The City of South San Francisco and the Peninsula Corridor Joint Powers Board (PCJPB)secured funding to upgrade the South San Francisco Caltrain Station (“Project”)in December 2015.The Project was estimated to cost up to $59 million.As outlined in the existing agreement,the City committed to contributing 10 percent ($5.9 million)of the Project cost.Two amendments were made to the funding agreement related to enhancing the station beyond the standards provided by the PCJPB: ·On January 25,2017,City Council approved an additional $1.3 million to incorporate structural design changes that maximize the pedestrian experience and encourage Caltrain Station use. ·On May 10,2017,City Council approved an additional $1.5 million to install high quality finish and paving materials and landscaping to the Project. Based on these modifications,at this time the City’s contribution to the Project totals $8.7 million.The PCJPB received bids for Project construction and has informed the City that the Capital funding for the Project is sufficient.The bid includes the City-requested changes to the design and finish materials.PCJPB staff has scheduled bid award for the August 3,2017 PCJPB meeting.Prior to award,PCJPB requests an executed airspace lease agreement between the City and Caltrans.This required airspace lease agreement is the subject of this staff report. See Exhibit A to the associated resolution for the draft airspace lease agreement. DISCUSSION A portion of the western plaza approach to the pedestrian underpass is located within the Caltrans’airspace right-of-way.This airspace right-of-way area is directly below the US-101 freeway,which is elevated over the Project area. See Attachment 1 for Airspace Lease Area Map. City of South San Francisco Printed on 8/30/2017Page 1 of 3 powered by Legistar™ File #:17-549 Agenda Date:7/26/2017 Version:1 Item #:6. It is necessary for PCJPB to obtain Caltrans approval for the proposed improvements.In order for Caltrain to construct the entire project,an airspace lease agreement between the City and Caltrans must be executed. Caltrans has a mandate to require fair market rate for leases of property beneath their freeway facilities.The proposed terms of the Airspace Lease are as follows: 1.Ten year lease, with up to three extended terms of ten years; 2.Monthly rent of $7,855 with a three percent increase annually (rent would be $9,945 by year ten); and 3.Periodic reevaluation of the fair market rate by Caltrans. 4.At the conclusion of the lease, all improvements on the premises vest with Caltrans. 5.At termination of lease, Caltrans may require removal of the improvements. 6.Caltrans may require City to temporarily or permanently relocate the improvements in the event that the improvements interfere with the construction of a Caltrans approved and funded transportation project. 7.Upon commencement of the lease,the City is responsible for removing any hazardous material that City knows is on the premises or that it has identified during any pre-lease environmental assessments and for removing any hazardous material later introduced during the lease term. The lease provisions summarized in Section 3-7 above are standard Caltrans lease requirements.Staff intends to continue negotiating with Caltrans to relax and/or refine these terms in light of the public benefits provided by the improvements.The associated resolution has been drafted to provide the City Manager sufficient authority to modify the airspace lease agreement after City Council approval to reflect the modified terms in the event that Caltrans agrees to the modifications.See Exhibit A in the associated resolution for the draft airspace lease agreement. Staff will be seeking a discount on the rent under the airspace lease from the California Transportation Commission (CTC).CTC Resolution G-03-03,attached here as Attachment 2,permits a 20 percent reduction in the Caltrans’calculated fair market rate for public mass transportation agencies to promote transit use.Caltrans staff has reviewed the City’s application and believes that the joint City/PCJPB Project qualifies for this discount.Given that the Project is constructing a permanent,high-quality transit improvement,staff will be requesting CTC consideration of up to a 50 percent reduction,which would result in a lease rate consistent with a peer review appraisal analysis evaluated by staff. Staff is preparing to present at the CTC October 2017 meeting.Short of closure on this outstanding request, staff is asking City Council for authorization to execute the airspace lease agreement now in order for the Project to break ground in November 2017.The agreement reflects the highest potential monthly rent of $7,855 with a three percent annual increase.If a reduction is approved by the CTC,the agreement will be amended to reflect the approved reduced amount.The best-case monthly rent could be $3,928 with a three percent annual increase. FUNDING Rent for Fiscal Year 2017-18 will be drawn from the already City allocated funding for the Project.For the following years,the rent will be included in the City’s budget request to City Council.Possibly budget sources include Infrastructure Reserves,Transit Impact Fee assessments to future developments,or Parking District City of South San Francisco Printed on 8/30/2017Page 2 of 3 powered by Legistar™ File #:17-549 Agenda Date:7/26/2017 Version:1 Item #:6. include Infrastructure Reserves,Transit Impact Fee assessments to future developments,or Parking District maintenance funds. CONCLUSION Staff recommends City Council approval of the airspace lease agreement.Approval of the resolution will allow the City Manager to execute the agreement, a necessary step for project construction. Attachments: 1.Airspace Lease Area Map 2.CTC Resolution G-03-03 with Discount Explanation City of South San Francisco Printed on 8/30/2017Page 3 of 3 powered by Legistar™ Airspace Lease Area Map – Area indicated in Red Outline City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-734 Agenda Date:7/26/2017 Version:1 Item #:6a. Resolution authorizing the City Manager to execute an airspace lease for the South San Francisco Caltrain Station with the State of California Department of Transportation in an amount not to exceed $94,260 per year escalated at 3 percent annually for up to ten years to allow project improvements and use of Caltrans property within the US-101 freeway right-of-way. WHEREAS,on December 9,2015,Peninsula Corridor Joint Powers Board (“PCJPB”)and the City of South San Francisco (“City”)entered into a Cooperative Agreement,pursuant to which City contracted with PCJPB to perform or contract for the performance of all design,project management,construction management, construction engineering and reconstruction related to the South San Francisco Caltrain Station (“Project”); and WHEREAS,PCJPB requires the execution of a construction and maintenance agreement (“C&M Agreement”) and evidence of a State of California Department of Transportation (“Caltrans”)airspace lease (“Airspace Lease”) between Caltrans and City before awarding a contract to qualified lowest bidder for the Project; and WHEREAS,the Airspace Lease between Caltrans and City is required in order to permit Project improvements within the Caltrans right-of-way; and WHEREAS,Caltrans has a mandate to require fair market rate for leases of property beneath their freeway facilities and therefore the City lease terms reflect the Caltrans standard agreement; and WHEREAS,the proposed lease terms include a ten (10)year lease,with up to three (3)extended terms of ten years,monthly rent of $7,855.00 with a fixed minimum 3 percent increase on the first day of the third year and every year thereafter so that monthly rent beginning July 1,2026 would be $9,945,and periodic reevaluation of the fair market rate by Caltrans; and WHEREAS,the Airspace Lease cost obligation by the City would be as high as $120,000 per year at the conclusion of the ten year, renewable lease; and WHEREAS,the Airspace Lease contains a provision and reference to California Transportation Commission (“CTC”)Resolution G-03-03 that permits a 20 percent reduction in the fair market rate for public mass transportation agencies to promote transit use; and WHEREAS,Caltrans staff has reviewed the City application and believes the Project is justified in requesting City of South San Francisco Printed on 8/30/2017Page 1 of 2 powered by Legistar™ File #:17-734 Agenda Date:7/26/2017 Version:1 Item #:6a. WHEREAS,Caltrans staff has reviewed the City application and believes the Project is justified in requesting the CTC 20 percent reduction; and WHEREAS,the City has requested an opportunity to attend an upcoming CTC public meeting to request a greater than 20 percent reduction since the Project includes high quality site improvements,a nearly $10 million contribution to the Project by the City for hard costs and land acquisition,and a Project location within a Priority Development Area adjacent to high density residential and employment centers that will have a significant reduction in greenhouse gas emissions consistent with the State of California’s AB 32 and SB 375 statewide climate goals; and WHEREAS,the City will need to execute the Airspace Lease with Caltrans prior to PCJPB award of contract scheduled for August 3,2017 and then amend and revise the Airspace Lease if CTC awards a 20 percent reduction or higher as desired by City; and WHEREAS,the funding for the initial first year of the Airspace Lease will be drawn from existing project allocated funding but year two and each year thereafter will require operating budget allocation by the City. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council hereby approves an Airspace Lease for the South San Francisco Caltrain Station with the State of California Department of Transportation in an amount not to exceed $94,260 per year escalated at three percent annually for up to ten years, attached hereto as Exhibit A. BE IT FURTHER RESOLVED that the City Council of the City of South San Francisco authorizes the Finance Department to establish an ongoing project budget to include the estimated costs consistent with the information contained in the staff report and Exhibit A. BE IT FURTHER RESOLVED that the City Council hereby authorizes the City Manager to execute this Airspace Lease for the South San Francisco Caltrain Station with the State of California Department of Transportation on behalf of the City in substantially the same form as attached hereto as Exhibit A;to make any revisions,amendments,corrections and modifications,subject to the approval of the City Attorney,deemed necessary to carry out the intent of this Resolution and which do not materially alter or increase the City’s obligations thereunder;and to take any related action reasonably necessary to carry out the intent of this Resolution. ***** City of South San Francisco Printed on 8/30/2017Page 2 of 2 powered by Legistar™ 1 (Lease Area No. 04-SM-101-01) (Account No. 04-SMX-101-0001-02) STATE OF CALIFORNIA DEPARTMENT OF TRANSPORTATION AIRSPACE LEASE THIS LEASE, dated May 4, 2017 is by and between the STATE OF CALIFORNIA, acting by and through its Department of Transportation, hereinafter called "Landlord," and City of South San Francisco, hereinafter called "Tenant." W I T N E S S E T H For and in consideration of the rental and of the covenants and agreements hereinafter set forth to be kept and performed by the Tenant, Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the Premises herein described for the term, at the rental and subject to and upon all of the terms, covenants and agreements hereinafter set forth. ARTICLE 1. SUMMARY OF LEASE PROVISIONS Landlord: California Department of Transportation Tenant: City of South San Francisco Premises: State Freeway Lease Area (FLA) SM-101-01 located in the City of South San Francisco County of San Mateo , State of California, and more particularly described in Article 2. Lease Term Ten (10) years plus three 10-year options, initial term commencing October 1, 2017 and expiring on September 30, 2027. Monthly Rent: $ 7855.00 (Article 4) Security Deposit: $ -0- (Article 18) Use: Build and maintain Pedestrian undercrossing (Article 5) Comprehensive General Liability Insurance: $5,000,000. (Article 10) Insurance provider: . Policy number: . Business Automobile Liability Insurance: $1,000,000. (Article 10) Insurance provider: . Policy number: . Garage Keeper's Legal Liability Insurance: $1,000,000. (Article 10) Insurance provider: . Policy number: . Workers' Compensation Insurance: $1,000,000. (Article 10) Insurance provider: . Policy number: . 2 Addresses for Notices: (Article 19) To Landlord: Department of Transportation Right of Way Airspace Development MS 11 US Mail: PO Box 23440, Oakland, CA 94623-0440 Street Address: 111 Grand Avenue, 13th floor Oakland, CA 94612-3771 To Tenant: City of South San Francisco 315 Maple Avenue South San Francisco, CA 94080 Richard Lee, Finance Director Email: [email protected] Phone: (650) 877-8505 References in this Article 1 to the other Articles are for convenience and designate other Articles where references to the particular item contained in the Summary of Lease Provisions appear. Each reference in this Lease to the Summary of Lease Provisions contained in this Article 1 shall be construed to incorporate all of the terms provided under the Summary of Lease Provisions. In the event of any conflict between the Summary of Lease Provisions and the balance of the Lease, the latter shall control. ARTICLE 2. PREMISES Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, for the term, at the rent, and upon the covenants and conditions hereinafter set forth, that certain Premises known as Freeway Lease Area No. SM-101-01, situated in the City of South San Francisco and County of San Mateo, said land or interest therein being shown on the map or plat marked "Exhibit A," attached hereto and by this reference made a part hereof. EXCEPTING THEREFROM all those portions of the above-described Premises occupied by the supports and foundations of the existing structure. ALSO EXCEPTING THEREFROM all that portion of the Premises above a horizontal plane 5 feet below the underside of the superstructure of the existing structure, which plane extends to a line 10 feet, measured horizontally, beyond the outermost protrusion of the superstructure of the structure. California Civil Code Section 1938 requires commercial landlords to disclose to tenants whether the property being leased has undergone inspection by a Certified Access Specialist ("CASp") to determine whether the property meets all applicable construction-related accessibility requirements. Tenant is hereby advised that the Premises have NOT been inspected by a CASp. ARTICLE 3. TERM The term of this Lease shall be for Ten (10) Years, commencing October 1, 2017, and expiring on September 30, 2027. Tenant shall have the option to exercise three (3) extended terms of ten (10) years, which extended term is to begin on the expiration of the initial term. The Tenant’s option of renewing this lease shall be exercised in writing by mailing by certified or registered mail notice to the Landlord at least one-hundred eighty (180) days prior to the commencement of this renewal period. In the event 3 Tenant does not exercise his option of renewal, Landlord shall have the right to post the lease premises with “For Lease” signs and show prospective tenants during any terminal six (6) month term of the lease. The minimum monthly rent for the option term shall be determined via Article 4. ARTICLE 4. RENT 4.1 Minimum Monthly Rent Tenant shall pay to Landlord as minimum monthly rent, without deduction, setoff, prior notice, or demand, the sum of $ 7855.00 per month, in advance on the first day of each month, commencing on the Term commencement date and continuing during the term. Minimum monthly rent for the second rent year and beyond shall be adjusted pursuant to section 4.2 below, and shall be subject to reevaluation as provided for within this Article. Minimum monthly rent for the first month or portion of it shall be paid on the Term commencement date. Minimum monthly rent for any partial month shall be prorated at the rate of 1/30th of the minimum monthly rent per day. All rent checks shall have printed on their face the following tenancy reference number 04-SMX-101-0001-02 and shall be paid to Landlord at the following address: State of California, Department of Transportation, Attention: Cashier, P. O. Box 168019, Sacramento, CA 95816-8019. 4.2 Discount to Rent In the case that the California Transportation Commission (CTC) approves a transportation discount pursuant to CTC Resolution G-03-03 Section 2.2, rent shall be discounted by 20% (or greater if so determined by CTC) of the fair market value lease rate of $ 7855.00 and adjustments made accordingly as per Section 4.3 of this lease less the 20% discount. If approved, such discount shall be memorialized via a written amendment to this Lease. 4.3 Adjustment to Rent The minimum monthly rent provided for in Section 4.1 shall be subject to adjustment as of the first day of the third year of the lease term and every year thereafter, either via a fixed minimum 3% increase (rounded to closest $5) or via an amount derived from a reevaluation which may occur at Landlord’s option per Section 4.4. Table 4.2.1 below provides the Tenant’s minimum rent obligation for the 10 years of the term, unless a new fair market rent is derived via reevaluation per Section 4.4 which will supersede the pre-calculated amounts within Table 4.2.1. If a new rent determined via a reevaluation does not take effect on the 6th, 11th and/or 16th year of the term, then the rent will continue to adjust annually at the set 3% fixed amount until a reevaluation, if any, takes place. Landlord shall not be required to provide any further notice to Tenant regarding annual rent adjustments during the Lease term. Table 4.3.1 Lease Year Period Rent July 1, 2017 $ 7,855.00 July 1, 2019 $ 8,090.00 July 1, 2020 $ 8,330.00 July 1, 2021 $ 8,580.00 4 July 1, 2022 $ 8,835.00 July 1, 2023 $ 9,100.00 July 1, 2024 $ 9,375.00 July 1, 2025 $ 9,655.00 July 1, 2026 $ 9,945.00 4.4 Landlord's Compensation upon Assignment, Transfer or Sublease of Tenant's Leasehold (a) In the event that Tenant voluntarily assigns, transfers or subleases any of Tenant's rights in the Premises, Tenant shall pay to Landlord compensation in connection with the transaction in an amount equal to fifty percent (50%) of any and all consideration, whether in present payments or in future payments, which Tenant receives from an assignee, transferee or subtenant in excess of the amount of rent Tenant is obligated to pay to Landlord under this Lease. (b) Payment by Tenant of the amount of compensation required under this Section 4.3 is a condition to Landlord's giving its consent to any assignment, transfer or sublease under Section 16.1, and Landlord may withhold its consent to any such assignment, transfer or sublease until this compensation has been paid. In addition, before Landlord gives its consent to any such transaction, Tenant shall deliver to the assignee, transferee or subtenant a written summary of all sums due and owing to Landlord under this section and shall deliver to Landlord a written acknowledgement by the assignee, transferee or subtenant that said person affirms that the sums are due and owing to Landlord and that said person accepts responsibility for ensuring that such sums are paid directly to Landlord. 4.5 Reevaluation of Minimum Monthly Rent Landlord, at its sole discretion, expressly reserves the right to reevaluate the minimum monthly rent three times during the term of this Lease. During the fifth, tenth, and fifteenth years from the date of the commencement of the initial term, or as soon thereafter as Landlord desires, a fair market lease rate may be determined in the manner set forth below and shall be established as the minimum monthly rent commencing on the start of the 6th, 11th, 16th years of the term or as soon thereafter upon the running of the notice period as provided for below. Notwithstanding anything contained herein to the contrary, any reevaluation of rent conducted pursuant to this Section 4.5 shall be discounted by the percentage approved by the CTC pursuant to Section 4.2 above. The minimum monthly rent established by this section shall continue to be subject to the 3% annual adjustment beginning in the third year established in Section 4.2. Table 4.2.1 shall be amended to reflect the new minimum monthly rent for the remaining Lease term pursuant to the reevaluation. The term "fair market lease rate" means the highest lease rate estimated in terms of money which the leased premises, excluding improvements constructed by Tenant thereon, would bring if exposed for lease in the open market, with a reasonable time allowed to find a tenant, leasing with full knowledge of the purpose and uses to which the leased premises is being put and the restrictions on use contained in Article 5 of this lease. The parties intend to establish the fair market lease rate through negotiation. At least 90 days prior to implementation of a new reevaluated lease rate, Landlord shall notice Tenant of its intent to reevaluate the rent, and shall propose to Tenant a new fair market lease rate. In an effort to encourage productive negotiations, if Landlord and Tenant have not mutually agreed upon the fair market lease rate for the Premises 60 days after the notice, then Landlord shall unilaterally set the fair market lease rate based on data collected from a rent survey of reasonably comparable Caltrans and non-Caltrans owned properties and shall use the highest per square foot rate paid by a tenant for a comparable property with a comparable use within approximately a one mile radius of the subject Premises. 5 If Landlord unilaterally sets the fair market lease rate, Tenant shall have the option to accept the new lease rate or Tenant may object to the new lease rate and elect to terminate the Lease with no penalty by providing to Landlord a 30 Day Notice of its intent to Quit. Such termination notice must be provided by Tenant to Landlord in writing. Tenant’s election to Quit shall place the Tenant in the same legal position as if the entire term of this Lease had run its course and expired. Tenant shall have no further rights other than those expressed within this Lease relevant to the natural expiration of the term of the Lease. In the case that Tenant does not provide notice of intent to terminate, the new fair market lease rate established by Landlord shall become effective on the first day of the month following Landlord’s 90 day notice of its intent to implement the new reevaluated lease rate. For example, if Landlord provides notice to Tenant of its proposed new rent on February 1, 2021, the new rent would take effect on May 1, 2021. If Tenant fails to pay the new fair market lease rate, Landlord shall treat Tenant’s failure to pay the new lease rate as a material breach. 4.6 Reevaluation on Change in Use Landlord expressly reserves the right to establish a new minimum monthly rent as a condition to Landlord’s approval of any use of the Premises not specifically permitted by Section 5.1 and as a condition to any amendment to or changes in the uses permitted by that section. 4.7 Reevaluation on Transfer Landlord expressly reserves the right to establish a new minimum monthly rent as a condition to Landlord’s specific approval of any transfer, or assignment of this Lease or any subletting of all or any portion of the Premises; provided, however, that Tenant shall have the right from time to time, upon notice to, but without the consent of Landlord, to transfer this Lease or use and occupancy of all or any of the Premises to any person or entity that directly or indirectly controls, is controlled by or is under common control with Tenant for any or all of the uses permitted under this Lease without any such new minimum monthly rent and without obtaining Landlord’s consent. ARTICLE 5. USE 5.1 Specified Use The Premises shall be used and occupied by Tenant only and exclusively for the purpose of open public plaza and pedestrian undercrossing and for no other purpose whatsoever without obtaining prior written consent of Landlord and the concurrence of the Federal Highway Administration. Landlord expressly reserves the right to establish a new minimum monthly rent as a condition to Landlord’s approval of any use of the leased premises not specifically permitted by this section. 5.2 Condition of Premises Tenant hereby accepts the Premises in the AS-IS condition existing as of the date of the execution hereof, subject to all applicable zoning, municipal, county, state and federal laws, ordinances and regulations governing and regulating the use of the Premises, and accepts this Lease subject thereto and to all matters disclosed thereby and by any exhibits attached hereto. Tenant acknowledges that neither Landlord nor any agent of Landlord has made any representation or warranty with respect to the condition of the Premises or the suitability thereof for the conduct of Tenant’s business, nor has Landlord agreed to undertake any modification, alteration or improvement to the Premises except as provided in this Lease. 6 Except as may be otherwise expressly provided in this Lease, the taking of possession of the Premises by Tenant shall in itself constitute acknowledgement that the Premises are in good and Tenantable condition, and Tenant agrees to accept the Premises in its presently existing condition "as is", and that the Landlord shall not be obligated to make any improvements or modifications thereto except to the extent that may otherwise be expressly provided in this Lease. Tenant represents and acknowledges that it has made a sufficient investigation of the conditions of the Premises existing immediately prior to the execution of this Lease (including investigation of the surface, subsurface and groundwater for contamination and hazardous materials) and is satisfied that the Premises will safely support the type of improvements, if any, to be constructed and maintained by Tenant upon the Premises, that the Premises is otherwise fully fit physically and lawfully for the uses required and permitted by this Lease and that Tenant accepts all risks associated therewith. Tenant acknowledges that (1) Landlord has informed Tenant prior to the commencement of the term of this Lease that the Landlord does not know nor has reasonable cause to believe that any release of any hazardous material has come to be located on or beneath the Premises; (2) prior to the commencement of the term of this Lease, the Landlord has made available to Tenant, for review and inspection, records in the possession or control of the Landlord which might reflect the potential existence of hazardous materials on or beneath the Premises; (3) Landlord has provided Tenant access to the Premises for a reasonable time and upon reasonable terms and conditions for purposes of providing to Tenant the opportunity to investigate, sample and analyze the soil and groundwater on the Premises for the presence of hazardous materials; (4) by signing this Lease Tenant represents to Landlord that, except as otherwise may be stated on “Exhibit C” attached hereto and by this reference incorporated herein, Tenant does not know nor has reasonable cause to believe that any release of hazardous material has come to be located on or beneath the Premises and (5) with respect to any hazardous material which Tenant knows or has reasonable cause to believe has come or will come to be located on or beneath the Premises, Tenant has listed the hazardous material on attached “Exhibit C” and agrees promptly to commence and complete the removal of or other appropriate remedial action regarding the hazardous material at no cost or expense to Landlord and in full compliance with all applicable laws, regulations, permits, approvals and authorizations. The phrase “hazardous material,” as used herein, has the same meaning as that phrase has in Section 5.7 of this Lease. Tenant agrees that, except as otherwise expressly provided in this Lease, Tenant is solely responsible without any cost or expense to the Landlord to take all actions necessary, off as well as on the Premises to improve and continuously use the Premises as required by this Lease and in compliance with all applicable laws and regulations. 5.3 Compliance with Law Tenant shall not use the Premises or permit anything to be done in or about the Premises which will in any way conflict with any law, statute, zoning restriction, ordinance or governmental rule or regulation or requirements of duly constituted public authorities now in force or which may hereafter be in force, or with the requirements of the State Fire Marshal or other similar body now or hereafter constituted, relating to or affecting the condition, use or occupancy of the Premises. The judgment of any court of competent jurisdiction or the admission of Tenant in any action against Tenant, whether Landlord be a party thereto or not, that Tenant has violated any law, statute, ordinance or governmental rule, regulation or requirement, shall be conclusive of that fact as between Landlord and Tenant. Tenant shall not allow the Premises to be used for any unlawful purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about the Premises. Tenant shall not commit or suffer to be committed any waste in or upon the Premises. 5.4 Compliance with Requirements of Lease Application 7 By executing this Lease, Tenant certifies that all the statements made in the Lease Application for this Lease are true and correct. If at any time during the term of this Lease Landlord discovers that any statement Tenant made in the Airspace Lease Application is false, this Lease may be terminated immediately by Landlord and be of no further force or effect. 5.5 Petroleum Products Tenant shall not install facilities for, nor operate on the Premises, a gasoline or petroleum supply station. Tenant shall not permit on the Premises any vehicles used or designed for the transportation or storage of gasoline or petroleum products. Tenant shall also not permit on the Premises any bulk storage of gasoline or petroleum products. 5.6 Explosives and Flammable Materials The Premises shall not be used for the manufacture of flammable materials or explosives, or for any storage of flammable materials, explosives or other materials or other purposes deemed by Landlord to be a potential fire or other hazard to the transportation facility. The operation and maintenance of the Premises shall be subject to regulations of Landlord so as to protect against fire or other hazard impairing the use, safety and appearance of the transportation facility. The occupancy and use of the Premises shall not be such as will permit hazardous or unreasonably objectionable smoke, fumes, vapors or odors to rise above the surface of the traveled way of the transportation facility. 5.7 Hazardous Materials Tenant shall at all times and in all respects comply with all federal, state and local laws, ordinances and regulations, including, but not limited to, the Federal Water Pollution Control Act (33 U.S.C. section 1251, et seq.), Resource Conservation and Recovery Act (42 U.S.C. section 6901, et seq.), Safe Drinking Water Act (42 U.S.C. section 300f, et seq.), Toxic Substances Control Act (15 U.S.C. section 2601, et seq.), Clean Air Act (42 U.S.C. section 7401, et seq.), Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. section 9601, et seq.), Safe Drinking Water and Toxic Enforcement Act (California Health and Safety Code section 25249.5, et seq.), other applicable provisions of the California Health and Safety Code (section 25100, et seq., and section 39000, et seq.), California Water Code (section 13000, et seq.), and other comparable state laws, regulations and local ordinances relating to industrial hygiene, environmental protection or the use, analysis, generation, manufacture, storage, disposal or transportation of any oil, flammable explosives, asbestos, urea formaldehyde, radioactive materials or waste, or other hazardous, toxic, contaminated or polluting materials, substances or wastes, including, without limitation, any “hazardous substances” under any such laws, ordinances or regulations (collectively “Hazardous Materials Laws”). As used in the provisions of this Lease, “hazardous materials” include any “hazardous substance” as that term is defined in section 25316 of the California Health and Safety Code and any other material or substance listed or regulated by any Hazardous Materials Law or posing a hazard to health or the environment. Except as otherwise expressly permitted in this Lease, Tenant shall not use, create, store or allow any hazardous materials on the premises. Fuel stored in a motor vehicle for the exclusive use in such vehicle is excepted. In no case shall Tenant cause or allow the deposit or disposal of any hazardous materials on the Premises. Landlord, or its agents or contractors, shall at all times have the right to go upon and inspect the Premises and the operations thereon to assure compliance with the requirements herein stated. This 8 inspection may include taking samples of substances and materials present for testing, and/or the testing of soils or underground tanks on the Premises. In the event Tenant breaches any of the provisions of this Section, this Lease may be terminated immediately by Landlord and be of no further force or effect. It is the intent of the parties hereto that Tenant shall be responsible for and bear the entire cost of removal and disposal of hazardous materials introduced to the Premises during Tenant’s period of use and possession as owner, operator or Tenant of the Premises. Tenant shall also be responsible for any clean-up and decontamination on or off the Premises necessitated by the introduction of such hazardous materials on the Premises. Tenant shall not be responsible for or bear the cost of removal or disposal of hazardous materials introduced to the Premises by any party other than Tenant during any period prior to commencement of Tenant’s period of use and possession of the Premises as owner, operator or Tenant. Tenant shall further hold Landlord, and its officers and employees, harmless from all responsibility, liability and claim for damages resulting from the presence or use of hazardous materials on the Premises during Tenant's period of use and possession of the Premises. 5.8 Signs Not more than four (4) advertising signs of a size not greater than thirty (30) square feet of surface area may be erected on the Premises. The wording on these signs shall be limited to Tenant's name or trade name, the words "Parking," or "Auto Parking," a statement of rates, and a directional arrow. The location of all these signs shall be subject to Landlord's prior approval. None of these signs shall be attached to or painted on any bridge structure or building without the express written consent of Landlord. All of these signs shall also comply with all applicable requirements of local governmental entitles, including governmental approval and payment of any fees. Except as set forth in the previous paragraph of this Section, Tenant shall not construct, erect, maintain or permit any sign, banner or flag upon the Premises without the prior written approval of Landlord. Tenant shall not place, construct or maintain upon the Premises any advertising media that include moving or rotating parts, searchlights, flashing lights, loudspeakers, phonographs or other similar visual or audio media. The term "sign" means any card, cloth, paper, metal, painted or wooden sign of any character placed for any purpose on or to the ground or any tree, wall, bush, rock, fence, building, structure, trailer or thing. Landlord may remove any unapproved sign, banner or flag existing on the Premises, and Tenant shall be liable to and shall reimburse Landlord for the cost of such removal plus interest as provided in Section 19.11 from the date of completion of such removal. 5.9 Landlord's Rules and Regulations Tenant shall faithfully observe and comply with the rules and regulations that Landlord shall from time to time promulgate for the protection of the transportation facility and the safety of the traveling public. Landlord reserves the right from time to time to make reasonable modifications to said rules and regulations. The additions and modifications to those rules and regulations shall be binding upon Tenant upon delivery of a copy of them to Tenant. 5.10 Wrecked Vehicles Tenant shall not park or store wrecked or inoperable vehicles of any kind on the Premises. 5.11 Vending 9 No third party vending of any kind or character shall be conducted, permitted or allowed upon the Premises without the prior express written consent of Landlord. 5.12 Water Pollution Control Tenant shall comply with all applicable State and Federal water pollution control requirements regarding storm water and non-storm water discharges from the tenant’s leasehold area and will be responsible for all applicable permits including but not limited to the National Pollutant Discharge Elimination System (NPDES) General Permit and Waste Discharge Requirements for Discharges of Stormwater Associated with Industrial Activities (Excluding Construction), the NPDES General Permit for Stormwater Discharges Associated with Construction and Land Disturbance Activities, and the Caltrans Municipal Separate Storm Sewer System NPDES Permit, and permits and ordinances issued to and promulgated by municipalities, counties, drainage districts, and other local agencies regarding discharges of storm water and non-storm water to sewer systems, storm drain systems, or any watercourses under the jurisdiction of the above agencies. Copies of the current storm water related NPDES permits are available on the State Water Resources Control Board’s website at http://www.swrcb.ca.gov/water_issues/programs/stormwater/. Tenant understands the discharge of non-storm water into the storm sewer system is prohibited unless specifically authorized by one of the permits or ordinances listed above. In order to prevent the discharge of non-storm water into the storm sewer system, vehicle or equipment washing, fueling, maintenance and repair on the Premises is prohibited. In order to prevent the discharge of pollutants to storm water resulting from contact with hazardous material, the storage or stockpile of hazardous material on Premises is strictly prohibited. Tenant shall implement and maintain the Best Management Practices (BMPs) shown in the attached Stormwater Pollution Prevention Fact Sheet(s) for: General Land Use and Parks and Recreation marked “Exhibit B.” Tenant shall identify any other potential sources of storm water and non-storm water pollution resulting from Tenant’s activities on the premises, which are not addressed by the BMPs, contained in the attached Fact Sheet(s), and shall implement additional BMPs to prevent pollution from those sources. Additional BMPs may be obtained from 2 other manuals: (1) Right of Way Property Management and Airspace Storm Water Guidance Manual available for review online at: www.dot.ca.gov/hq/row/rwstormwater, and (2) Construction Site Best Management Practices Manual, available for review online at: www.dot.ca.gov/hq/construc/stormwater/manuals.htm. In the event of conflict between the attached fact sheet(s), the above-referenced manuals, and this Lease, this Lease shall control. Tenant shall provide Landlord with the Standard Industrial Classification (SIC) code applicable to Lessee’s facilities and activities on the lease premises. A list of SIC codes regulated under the General Industrial Permit SIC codes may be found at the State Water Resources Control Board website: http://www.waterboards.ca.gov/water_issues/programs/stormwater/gen_indus.shtml. Other SIC codes may be found at www.osha.gov/pls/imis/sicsearch.html. Landlord, or its agents or contractors, shall at all times have the right to enter and inspect the Premises and the operations thereon to assure compliance with the applicable permits, and ordinances listed above. Inspection may include taking samples of substances and materials present for testing, and/or the testing of storm sewer systems or watercourses on the Premises. ARTICLE 6. IMPROVEMENTS 6.1 No Improvements Without Prior Written Consent of Landlord 10 No improvements of any kind shall be placed in, on, or upon the Premises, and no alterations shall be made in, on, or upon the Premises without the prior written consent of Landlord and the concurrence of the Federal Highway Administration. Tenant may, at its sole expense, install and maintain any additional fencing and entrances that may be required by its use of the Premises, subject to the approval of the location by Landlord, the Federal Highway Administration and the City of South San Francisco and County of San Mateo ; provided that Tenant shall at its sole expense construct and maintain sidewalks and driveways at the locations where the additional entrances are installed. In the event Tenant violates any of the provisions of this Article, this Lease may be terminated immediately by Landlord and be of no further force or effect. 6.2 Encroachment Permit Tenant, prior to construction or alteration of any improvements on or of the leased premises, shall obtain an executed Encroachment Permit from Landlord. Issuance by Landlord of an Encroachment Permit shall be contingent upon Tenant's providing, at Landlord’s sole discretion, all or a combination of, the following, to the extent applicable: (a) Final construction plans and detailed specifications. All such plans and specifications submitted by Tenant to Landlord shall be subject to the review and approval of Landlord, the State Fire Marshal and if on an interstate freeway the Federal Highway Administration. (b) Evidence of coverage that assures Landlord that sufficient monies will be available to complete the proposed construction or alteration. The amount of coverage shall be at least equal to the total estimated construction cost. Such coverage shall take one of the following forms: (1) Completion bond issued to Landlord as obligee. (2) Performance bond and labor and material bond or performance bond containing the provisions of the labor and material bond supplied by Tenant's contractor or contractors, provided said bonds are issued jointly to Tenant and Landlord as obligees. (3) Satisfactory evidence of availability of funds necessary for completion of the proposed construction or alteration. (4) Any combination of the above. All bonds shall be issued by a company qualified to do business in the State of California and acceptable to Landlord. All bonds be in a form acceptable to Landlord and shall ensure faithful and full observance and performance by Tenant of all terms, conditions, covenants and agreements relating to the construction of improvements within the leased premises. (c) Liability insurance as provided in Article 10. (d) A copy of a building permit issued by the appropriate local jurisdiction. (e) A copy of Tenant's contract with the general contractor actually performing construction. (f) Note and Deed of Trust, if any. (g) Loan escrow instructions, if any. (h) Final landscaping and irrigation plans and detailed specifications including a maintenance plan for litter removal, watering, fertilization and replacement of landscaping. (i) Evidence of compliance with the applicable provisions of all federal, state and local environmental statutes, laws, regulations and ordinances. Tenant agrees to diligently apply for and meet all requirements for issuance of the Encroachment Permit and Landlord agrees to not unreasonably withhold issuance of said Encroachment Permit. Tenant is obligated to deliver to Landlord the documents described in subdivisions (a) through (i) of this section regardless of whether an Encroachment Permit may have been issued inadvertently before these documents have been provided to Landlord. 11 6.3 Planning and Zoning Tenant’s use and proposed improvements shall be subject to all applicable zoning, municipal, county, state and federal laws, ordinances and regulations governing and regulating the use of the Premises. 6.4 Standard of Construction Tenant agrees that any improvements or construction upon the premises shall: (a) be consistent with all fire safety requirements including State Fire Marshall approval, (b) be subject to the approval of Landlord, and (c) in every respect comply with the laws, ordinances and regulations, federal, state, municipal or otherwise, that may govern construction of the same. Tenant shall not construct or place on the leased premises any improvements which impair Landlord's ability to maintain, operate, use, repair or improve any part of the transportation facility situated on the leased premises or on adjoining real property. Tenant shall save Landlord harmless of and from any loss or damage caused by reason of the construction of said improvements. 6.5 Soil Testing At Tenant's sole cost and expense, Tenant shall secure soil compaction tests and other tests as necessary for construction of Tenant's improvements and for the support of the improvements on the underlying land or structures thereon. Tenant shall notify Landlord of the location of all test borings, which shall not interfere in any manner with the operation of the facility by Landlord. Tenant hereby agrees that Landlord is making no representation regarding existing soil compaction or structural capability of the land or any existing structure thereon. Responsibility for any loss or damage caused by inadequate soil compaction or other structural capacity for Tenant's proposed improvements shall be subject to the indemnification provisions of Section 10.1 6.6 Commencement of Construction Tenant shall commence construction of the improvements described in Tenant's final construction plans and detailed specifications within 365 calendar days of the date of execution of this Lease. For the purposes of this Article, construction shall be deemed to have commenced upon the issuance by Landlord of an encroachment permit under Section 7.1. In the event construction is not commenced within the time set forth herein, this Lease may be terminated by Landlord and thereafter be of no further force and effect. 6.7 Completion of Construction and Occupancy of Improvements Construction of the improvements shall be completed consistent with the approved construction plans within 1,095___ calendar days after the commencement of construction. Tenant shall not occupy or use any of the improvements until Tenant has received final building approval and a Certificate of Occupancy from the appropriate local agency and Landlord has issued to Tenant an executed Encroachment Permit Completion Notice. In the event Tenant violates any of the provisions of this section, this Lease may be terminated by Landlord and be of no further force and effect. 6.8 “As-Built" Plans Within ninety (90) days after completion of construction of improvements or alterations, 12 Tenant shall furnish Landlord, at Tenant's expense, one set of "As-Built" plans, according to a scale and size designated by Landlord, showing said improvements as constructed in detail, including the location of underground and aboveground utility lines. 6.9 Termination If Required Construction Proves Economically Infeasible This Lease requires Tenant to submit plans for any proposed improvements and construction activities conducted on the premises and to obtain an Encroachment Permit prior to beginning any construction related activities on the premises. If Landlord’s Encroachment Permits office reviews Tenant’s plans, and thereafter requires Tenant to construct certain improvements or to employ certain construction methods as a condition of the Encroachment Permit, Tenant shall have the option to elect not to proceed with the construction or to terminate this lease agreement if the required improvements or construction methods prove economically infeasible to Tenant. ARTICLE 7. SURRENDER OF PREMISES AT EXPIRATION OR TERMINATION OF LEASE At the expiration or earlier termination of this Lease, Tenant shall peaceably and quietly leave, surrender, and yield up to Landlord the Premises together with all appurtenances and fixtures in good order, condition and repair, reasonable wear and tear excepted. ARTICLE 8. OWNERSHIP AND REMOVAL OF IMPROVEMENTS AND PERSONAL PROPERTY 8.1 Ownership of Improvements During Term All improvements constructed on the premises by Tenant as permitted or required by this Lease shall, during the term of this Lease, be and remain the property of Tenant; provided, however, that Tenant's rights and powers with respect to the improvements are subject to the terms and limitations of this Lease and Tenant's interest in such improvements shall terminate upon the expiration or earlier termination of this Lease. Following completion of construction, Tenant shall not remove any improvements from the premises nor waste, destroy or modify any improvements on the premises, except as specifically permitted by this Lease. At the expiration or termination of this lease, all improvements constructed on the premises by Tenant shall vest in Landlord. Tenant shall deliver said improvements to Landlord in good condition and repair, reasonable wear and tear excepted, without compensation to Tenant, any subtenant or third party, free and clear of all claims to or against them by Tenant, any subtenant or third party, and Tenant shall defend and hold Landlord harmless from all liability arising from such claims or from the exercise by Landlord of its rights under this section. In the event said improvements are not delivered to Landlord in good condition and repair, reasonable wear and tear excepted, Landlord shall make the necessary maintenance and repairs and Tenant shall be liable to and shall reimburse Landlord for any such expenditures made, plus interest as provided in Section 22.11 from the date of completion of work. Landlord and Tenant covenant for themselves and all persons claiming under or through them that the improvements are real property. 8.2 Removal of Personal Property and Ownership at Termination At the expiration or earlier termination of this Lease, Landlord may, at Landlord's sole election, require the removal from the premises, at Tenant's sole cost and expense, of all personal property (other than fixtures), or of certain personal property (other than fixtures), as specified in the notice provided for below. A demand to take effect at the normal expiration of the term shall be effected by 13 notice given at least thirty (30) days before the expiration date. A demand to take effect on any other termination of the term of this Lease shall be effectuated by notice given concurrently with notice of such termination or within ten (10) days after such termination. Tenant shall be liable to Landlord for costs incurred by Landlord in effecting the removal of personal property which Tenant has failed to remove after demand pursuant to this Section 8.2. Tenant may remove any personal property from time to time within forty-five (45) days of the expiration of the term. Tenant shall repair all damage (structural or otherwise) caused by any such removal. Any personal property not removed by Tenant within forty-five (45) days following expiration of the term shall be deemed to be abandoned by Tenant and shall, without compensation to Tenant, become the Landlord's property, free and clear of all claims to or against them by Tenant or any other person. 8.3 Removal of Improvements at Termination Upon the expiration or earlier termination of this Lease, Landlord may, upon written notice, require Tenant to remove, at the sole cost and expense of Tenant, and not later than ninety (90) days after the expiration or earlier termination of this Lease, all structures, buildings and improvements of any kind whatsoever placed or maintained on the premises, whether below, on or above the ground by Tenant or others, including, but not limited to, foundations, structures, buildings, utility lines, switchboards, transformer vaults and all other service facilities constructed or installed upon the premises; and Tenant shall, upon the expiration or earlier termination of this Lease, immediately restore, and quit and peacefully surrender possession of the premises to Landlord in at least as good and usable condition, acceptable to Landlord, as the same was in at the time of first occupation thereof by Tenant or others, ordinary wear and tear excepted, and shall, in any event, leave the surface of the ground in a level, graded condition, with no excavations, holes, hollows, hills or humps. Should Tenant fail to so remove said structures, buildings and improvements and restore the premises, Landlord may sell, remove or demolish the same, and in the event of said sale, removal or demolition, Tenant shall reimburse Landlord for any cost or expense thereof in excess of any consideration received by Landlord as a result of such sale, removal or demolition. 8.4 Liens (a) Exemption of Landlord from Liability Tenant shall at all times indemnify and save Landlord harmless from all claims for labor or materials in connection with construction, repair, alteration, or installation of structures, improvements, equipment or facilities by Tenant or Tenant’s agents within the premises, and from the cost of defending against such claims, including attorney fees. (b) Tenant's Obligations In the event a lien is imposed upon the premises as a result of such construction, repair, alteration or installation by Tenant or Tenant’s agents, Tenant shall either: (1) Record a valid Release of Lien, or (2) Deposit sufficient cash with Landlord to cover the amount of the claim on the lien in question and authorize payment to the extent of said deposit to any subsequent judgment holder that may arise as a matter of public record from litigation with regard to a lienholder claim, or (3) Procure and record a bond in accordance with Section 3143 of the California Civil Code, which frees the premises from the claim of the lien and from any action brought to foreclose the 14 lien. Should Tenant fail to accomplish one of the three optional actions within 15 days after the filing of such a lien, the Lease shall be in default and shall be subject to immediate termination. ARTICLE 9. MAINTENANCE AND REPAIRS 9.1 Tenant's Obligations Tenant, at its own cost and expense, shall maintain the Premises, and keep it free of all grass, weeds, debris, and flammable materials of every description. Tenant shall ensure that the Premises is at all times in an orderly, clean, safe, and sanitary condition. Landlord requires a high standard of cleanliness, consistent with the location of the Premises as an adjunct of the California State Highway System. Tenant hereby expressly waives the right to make repairs at the expense of Landlord and waives the benefit of the provisions of Sections 1941 and 1942 of the California Civil Code or any successor thereto. Tenant shall take all steps necessary to protect effectively the fences, guardrails, and the piers and columns, if any, of the all structures from damage incident to Tenant's use of the Premises and any improvements, all without expense to Landlord. Tenant shall, at its own cost and expense, repair in accordance with Landlord's standards any damage to any property owned by Landlord, including, but not limited to, all fences, guardrails, piers and columns, caused by Tenant, subtenants, invitees or other third parties. At Tenant's request, Landlord will repair the damage to its property, and Tenant agrees to reimburse Landlord promptly after demand for the amount Landlord has reasonably expended to complete the repair work. Tenant shall be responsible for the care, maintenance, and any required pruning of trees, shrubs, or any other landscaping on the Premises. Tenant assumes the liability for any damage or injury caused by any falling branches or other such materials from any tree or shrub whether the branches fall due to lack of maintenance or act of god or any other natural or unnatural causes. Tenant’s liability insurance required within Article 10 shall cover any damage caused by any falling tree or shrub branches or other materials; and, furthermore, per the same Article 10, Tenant covenants and agrees to indemnify and save harmless Landlord from all liability, loss, cost, and obligation on account of any injuries or losses caused by any falling branches or material from any tree or shrub. Tenant shall designate in writing to Landlord a representative who shall be responsible for the day-to-day operation and level of maintenance, cleanliness and general order. 9.2 Landlord's Rights In the event Tenant fails to perform Tenant's obligations under this Article, Landlord shall give Tenant notice to do such acts as are reasonably required to so maintain the Premises. If within ten (10) days after Landlord sends written notice to repair, Tenant fails to do the work and diligently proceed in good faith to prosecute it to completion, Landlord shall have the right, but not the obligation, to do such acts and expend such funds at the expense of Tenant as are reasonably required to perform such work. Any amount so expended by Landlord shall be paid by Tenant promptly after demand plus interest as provided in Section 19.11 from the date of completion of such work to date of payment. Landlord shall have no liability to Tenant for any damage, inconvenience or interference with the use of the Premises by Tenant as a result of performing any such work. 9.3 Retention of Existing Improvements 15 Landlord may at its option retain existing State improvements including fencing, lighting and irrigation facilities. If Landlord elects to retain any improvements, Tenant shall remove same and deliver same to Landlord's nearest maintenance station at no cost to Landlord. ARTICLE 10. INSURANCE 10.1 Exemption of Landlord from Liability This Lease is made upon the express condition that Landlord is to be free from all liability and claims for damages by reason of any injury to any person or persons, including Tenant, or property of any kind whatsoever and to whomsoever belonging, including Tenant, from any cause or causes resulting from the operation or use of the Premises by Tenant, its agents, customers or business invitees. Tenant hereby covenants and agrees to indemnify and save harmless Landlord from all liability, loss, cost and obligation on account of any such injuries or losses. 10.2 Commercial General Liability Insurance Tenant shall at its own cost and expense procure and keep in force during the term of this Lease comprehensive bodily injury liability and property damage liability insurance adequate to protect Landlord, its officers, agents and employees, against any liability to the public resulting from injury or death of any person or damage to property in connection with the area, operation or condition of the Premises, including any and all liability of Landlord for damage to vehicles parked on the Premises. Such insurance shall be in an amount of not less than $5,000,000 combined single limit for bodily injury and property damage. The limits of such insurance shall not limit the liability of Tenant. All insurance required hereunder shall be with companies to be approved by Landlord. All such policies shall be written as primary policies, not contributing with and not in excess of coverage which Landlord may carry. Said policies shall name the State as an additional insured and shall insure against the contingent liabilities, if any, of Landlord and the officers, agents, and employees of Landlord and shall obligate the insurance carriers to notify Landlord, in writing, not less than thirty (30) days prior to the cancellation thereof, or any other change affecting the coverage of the policies. If said policies contain any exclusion concerning property in the care, custody or control of the insured, an endorsement shall be attached thereto stating that such exclusion shall not apply with regard to any liability of the State of California, its officers, agents, or employees. Tenant shall furnish to Landlord a Certificate of Insurance acceptable to Landlord within not more than ten (10) days after execution thereof. Landlord shall retain the right at any time to review the coverage, form, and amount of the insurance required hereby. If, in the opinion of Landlord, the insurance provisions in this Lease do not provide adequate protection for Landlord and for members of the public using the Premises, Landlord may require Tenant to obtain insurance sufficient in coverage, form and amount to provide adequate protection. Landlord's requirements shall be reasonable but shall be designed to assure protection from and against the kind and extent of the risks which exist at the time a change in insurance is required. Landlord shall notify Tenant in writing of changes in the insurance requirements; and if Tenant does not deposit copies of acceptable insurance policies with Landlord incorporating such changes within sixty (60) days of receipt of such notice, this Lease may be terminated, at Landlord's option, without further notice to Tenant, and be of no further force and effect. 10.3 Business Automobile Liability Insurance Tenant shall obtain and keep in effect at all times during the term of this Lease business automobile liability insurance in an amount not less than $1,000,000 for each occurrence combined 16 single limit for bodily injury and property damage, including coverage for owned, non-owned and hired automobiles, as applicable. Any deductible under such policy shall not exceed $10,000 each occurrence. 10.4 Garage Keeper's Legal Liability Insurance If Tenant’s use involves any auto repair or storage of customer vehicles, Tenant shall obtain and keep in effect at all times during the term of this Lease garage keeper's legal liability insurance in an amount not less than $1,000,000 for each occurrence combined single limit for loss and damage to vehicles in Tenant's care, custody or control caused by fire, explosion, theft, riot, civil commotion, malicious mischief, vandalism or collision, with any deductible not exceeding $1,000 for each occurrence, and coverage for non-automobile property customarily left in the custody of a garage with a limit of $5,000. 10.5 Workers' Compensation Insurance Tenant shall obtain and keep in effect at all times during the term of this lease workers' compensation insurance, including employers' liability, in an amount not less than $1,000,000 for each accident, covering all employees employed in or about the Premises to provide statutory benefits as required by the laws of the State of California. Said policy shall be endorsed to provide that the insurer waives all rights of subrogation against Landlord. 10.6 Failure to Procure and Maintain Insurance If Tenant fails to procure or maintain the insurance required by this Article in full force and effect, this Lease may be terminated immediately by Landlord and be of no further force or effect. In addition, if Tenant fails to procure or maintain the insurance required by this Article, Tenant shall cease and desist from operating any business on the Premises and the improvements erected thereon and shall prevent members of the public from gaining access to the Premises during any period in which such insurance policies are not in full force and effect. 10.7 Waiver of Subrogation Tenant hereby waives any and all rights of recovery against Landlord, or against the officers, employees, agents and representatives of Landlord, for loss of or damage to Tenant or its property or the property of others under its control to the extent that such loss or damage is insured against under any insurance policy in force at the time of such loss or damages. Tenant shall give notice to its insurance carrier or carriers that the foregoing waiver of subrogation is contained in the Lease. 10.8 Self-Insurance Coverage Notwithstanding any other provision of this Agreement, the insurance required under Article 10 may include a self-insurance program, subject to Landlord’s prior express written consent and approval. No such self-insurance program shall diminish the rights and privileges to which Landlord would otherwise have been entitled to under the terms of this Agreement had there been a third-party insurer. Tenant’s self insurance shall include such coverage as would have been covered by Commercial General Liability Insurance with respect to the Premises with limits of liability not less than Five Million Dollars ($5,000,000) per occurrence with no aggregate limit. Tenant shall provide 17 Landlord with a certificate of self-insurance specifying the extent of self-insurance coverage hereunder and containing a waiver of subrogation provision reasonably satisfactory to Landlord. Tenant shall notify Landlord in writing not less than thirty (30) days prior to the effective date of the termination of its self-insurance coverage and shall obtain the insurance coverage required by this Article effective on that termination date. Execution of this Lease Agreement shall be Tenant’s acknowledgment that Tenant will be bound by all laws as if the Tenant were an insurer as defined under California Insurance Code Section 22 (7-1.12B(5)). ARTICLE 11. PAYMENT OF TAXES Tenant agrees to pay and discharge, or cause to be paid and discharged when due, before the same become delinquent, all taxes, assessments, impositions, levies and charges of every kind, nature and description, whether general or special, ordinary or extraordinary, which may at any time or from time to time during the term of this Lease, by or according to any law or governmental, legal, political, or other authority whatsoever, directly or indirectly, be taxed, levied, charged, assessed or imposed upon or against, or which shall be or may be or become a lien upon the Premises or any buildings, improvements or structures at any time located thereon, or any estate, right, title or interest of Tenant in and to the Premises, buildings, improvements or structures. Specifically, and without placing any limitation on Tenant's obligations under the immediately preceding sentence, Tenant shall pay when due, before delinquency, any and all possessory interest taxes, parking taxes, workers' compensation, taxes payable to the California Franchise Tax Board, personal property taxes on fixtures, equipment and facilities owned by Tenant, whether or not the same have become so fixed to the land as to comprise a part of the real estate. Tenant understands that any possessory interest of Tenant created in the Premises by this Lease may be subject to property taxation and that Tenant may be liable for payment of any such tax levied on such interest. Any obligation of Tenant under this Article, including possessory interest tax that the city or county may impose upon Tenant's interest herein, shall not reduce any rent due Landlord hereunder and any such obligation shall become the liability of and be paid by Tenant. In the event Tenant defaults in the payment of any of the obligations set forth in this Article, this Lease may be terminated immediately by Landlord and be of no further force or effect. ARTICLE 12. RIGHT OF ENTRY 12.1 Inspection, Maintenance, Construction and Operation of Freeway Structures Landlord, through its agents or representatives, and other city, county, state and federal agencies, through their agents or representatives, shall have full right and authority to enter in and upon the Premises and any building or improvements situated thereon at any and all reasonable times during the term of this Lease for the purpose of inspecting the same without interference or hindrance by Tenant, its agents or representatives. Landlord further reserves the right of entry for the purpose of inspecting the Premises, or the doing of any and all acts necessary or proper on said Premises in connection with the protection, maintenance, reconstruction, and operation of the freeway structures and its appurtenances; provided, further, that Landlord reserves the further right, at its discretion, to immediate possession of the same in case of any national or other emergency, or for the purpose of preventing sabotage, and for the protection of said freeway structures, in which event the term of this Lease shall be extended for a period equal to the emergency occupancy by Landlord, and during said period Tenant shall be relieved, to the degree of interference, from the performance of conditions or covenants specified herein. 18 Landlord further reserves the right of entry by any authorized officer, engineer, employee, contractor or agent of the Landlord for the purpose of performing any maintenance activities upon the property which Tenant has failed to perform after the expiration of the applicable cure period specified in Article 9. 12.2 Future Transportation Projects (a) Landlord's Right to Possession of Premises. Tenant understands and acknowledges that Landlord may, during the Term of this Lease, construct an "Approved and Funded Transportation Project", which may require the temporary or permanent use of all or a portion of the premises. An "Approved and Funded Transportation Project" is defined as a proposed transportation facility to be constructed by Landlord where the funds necessary to construct the facility are available to Landlord (regardless of the source of the funds) and where the transportation facility can reasonable be expected to be constructed within a reasonable period of time following termination of this Lease as provided in this Article. In the event Landlord determines that the premises or any portion thereof will be affected by an "Approved and Funded Transportation Project", Landlord shall immediately notify Tenant of its intent to take possession of all or a portion of the premises and shall provide Tenant with at least ninety (90) days written notice within which to vacate the required area. Landlord's notice to Tenant shall indicate the area of the premises to be taken. If possession is to be a temporary use of all or part of the premises, Landlord shall additionally state in such notice to Tenant Landlord's reasonable estimate of the period of time of such temporary use by Landlord. If possession is to be permanent, Landlord shall have the right to terminate the Lease. Upon the date Landlord is entitled to possession of the premises, or portion thereof, Tenant shall peaceably surrender possession of the premises, or portion thereof, and comply with the restriction as stated in the notice. The failure of Tenant to vacate the required area of the premises shall constitute a material default and breach of this Lease entitling Landlord to exercise its rights and remedies. (b) Reduction of Monthly Rent if Lease Remains Effective For the period during which Landlord has taken possession of the premises under this section, and if this Lease remains effective, Tenant shall be entitled to receive a reduction in Monthly Rent for the term of Landlord's use of the area of the premises used by Landlord. The rent will be reduced by the same percentage as the useable square footage reduction as required by State’s project. (c) Tenant's Sole Rights; Tenant's Waiver. Landlord's taking of possession of the premises under this Section 12.2 does not constitute a taking or damaging entitling Tenant to compensation under any Condemnation provisions. The reduction in Monthly Rent as provided herein shall be Tenant's sole remedy against Landlord for Tenant's inability to possess or use part or all of the area of the premises as a result of an "Approved and Funded Transportation Project", and Tenant expressly agrees to hold Landlord harmless from any and all liability for, and expressly waives any right it may have to recover against Landlord, damages to the Premises, any improvements constructed on the premises or improvements thereon, and damages to any other property, project or operations including any claim for loss of business goodwill or resulting from Tenant's inability to use or possess all or any portion of the premises as a result of an "Approved and Funded Transportation Project". In addition, Tenant expressly recognizes that it is not entitled to receive benefits under the federal or state Uniform Relocation Assistance Act (United States 19 Code, Section 7260, et seq.) as a result of Landlord's use or possession of any portion of the premises an "Approved and Funded Transportation Project". Landlord agrees to instruct its authorized representatives to minimize the effect of any required construction on Tenant's use of the premises, both in the construction phase and in the permanent effect on the premises in connection with an "Approved and Funded Transportation Project". 12.3 Maintenance Work and Retrofitting of Freeway Structures Tenant understands and agrees that Landlord may be required to perform maintenance or retrofit work on all or a part of the freeway structures that are situated on and above the premises. Landlord shall have the right to impose such restrictions on Tenant's right to enter, occupy, and use the premises and to maintain the existing improvements or construct improvements thereon as Landlord deems are necessary to enable it to complete construction of all freeway maintenance or structural retrofit work without interference from Tenant. In the event Landlord determines that it needs to obtain possession of all or a portion of the premises, or needs to place restrictions on Tenant's use of the premises, Landlord shall, if possible, at least thirty (30) days prior to the effective date of the commencement of such possession or restrictions notify Tenant in writing describing the extent of the possession or restrictions and the effective date of their commencement. Upon the effective date of said notice, Tenant shall peaceably surrender possession of the premises and comply with the restrictions as stated therein. The minimum monthly rent stated in Section 4.1, as adjusted in Section 4.2, shall be reduced by an amount equal to the proportion which the area of the portion of the premises which Tenant is restricted from using or which has been surrendered to Landlord bears to the total area of the leased premises. This reduction in rent shall be Tenant's sole remedy against Landlord for Tenant's inability to possess or use the entire area of the premises, and Tenant expressly agrees to hold Landlord harmless from any and all liability for, and expressly waives any right it may have to recover against Landlord, damages to the premises, any improvements constructed on the premises, and waives its right to use or possess any portion of the premises or improvements thereon, and damages to any other property, project or operation caused by Landlord's possession, imposition of restrictions or Tenant's inability to use or possess all or any portion of the premises. In addition, Tenant expressly recognizes that it is not entitled to receive benefits under the federal or state Uniform Relocation Assistance Acts (United States Code, title 42, Section 4601, et seq.; California Government Code, Section 7260, et seq.) as a result of Landlord's use or possession of any portion of the premises. Tenant shall conduct its operations on the premises in such a manner so as not to interfere with Landlord's or its contractor's performance of any structural retrofit work done on or above the premises. Tenant acknowledges that the performance of the structural retrofit work may cause damage to paving or other improvements constructed by Tenant on the premises. Tenant expressly agrees to hold Landlord harmless from all such damage to its improvements, except that at the conclusion of the retrofit work, Landlord shall restore the premises to their preexisting condition at no cost to Tenant. 12.4 Reinstitution of Lease. If Landlord takes possession of all or a portion of the Premises in accordance with the preceding provisions of this Article 12, Landlord shall notify Tenant that Landlord has completed the use or work requiring such repossession within thirty days after Landlord completes such use or work, and if requested by Tenant in writing within ninety days thereafter, either (i) in the case of a partial repossession by Landlord, Tenant shall be entitled to lease the entire Premises (i.e., the initial Premises leased before Landlord’s repossession) and pay the corresponding minimum monthly rent for the remainder of the Lease term and (ii) in the case of a total repossession by Landlord and termination of 20 the Lease, Landlord shall enter into a new lease with Tenant with respect to the entire Premises with substantially the same terms and conditions as set forth in this Lease (except that the expiration date of the new lease shall be extended one day for each day between the date of Landlord’s repossession and the commencement date of the new lease, which shall be Landlord’s only obligation to Tenant in the case it repossesses all of the Premises). ARTICLE 13. CONDEMNATION BY PUBLIC ENTITIES OTHER THAN LANDLORD 13.1 Definitions (a) "Condemnation" means (1) the exercise of the power of eminent domain, whether by legal proceedings or otherwise, by a public entity having that power, that is, a condemnor, and (2) a voluntary sale or transfer to any condemnor, either under the threat of condemnation or while legal proceedings in condemnation are pending. (b) "Award" means all compensation, sums, or anything of value awarded, paid or received upon a total or partial condemnation of the leased premises. (c) "Substantial taking" means a taking of a portion of the leased premises by condemnation which, assuming a reasonable amount of reconstruction on the remainder, substantially impairs Tenant's ability to use the remainder for the purposes permitted under this Lease. 13.2 Termination of Lease as to Part Condemned In the event the whole or any part of the premises is taken by condemnation by a public entity, other than Landlord, in the lawful exercise of its power of eminent domain, this Lease shall cease as to the whole or the part condemned upon the date possession of the whole or that part is taken by the public entity. 13.3 Partial Taking If a part of the leased premises is taken by condemnation but there is no substantial taking of the premises, Tenant shall continue to be bound by the terms, covenants, and conditions of this Lease. However, if the fair rental value of the remainder will be less than the rent required by this Lease, the minimum monthly rent and adjusted minimum monthly rent shall be reduced to an amount equal to the fair rental value as of the date possession of the part is taken by the public entity. If the part taken by condemnation constitutes a substantial taking of the leased premises, Tenant may elect to: (a) Terminate this Lease and be absolved of obligations hereunder which have not accrued at the date possession is taken by the public entity; or (b) Continue to occupy the remainder of the premises and remain bound by the terms, covenants and conditions of this Lease. If Tenant elects to continue to occupy the remainder, and if the fair rental value of the remainder will be less than the rent required by this Lease, the minimum monthly rent and adjusted minimum monthly rent shall be reduced to the fair rental value as of the date possession of the part is taken by the public entity. Tenant shall give notice in writing of its election to terminate this Lease hereunder within thirty (30) days of the date possession of the part is taken by the public entity. If Tenant fails to give Landlord its written notice of termination within the time specified, this Lease shall remain in full force and effect except that the minimum monthly rental shall be reduced as provided in this section. If it continues to occupy the remainder, Tenant, whether or not the award upon the taking by condemnation is sufficient for the purpose, shall, at its expense, within a reasonable period of time, 21 commence and complete restoration of the remainder of the leased premises as nearly as possible to its value, condition and character immediately prior to such taking; provided, however, that in the case of a taking for temporary use, Tenant shall not be required to effect restoration until such taking is terminated. Tenant shall submit to Landlord its plans for the restoration of the remainder within ninety (90) days of the date possession of the part is taken by the public entity. 13.4 Adjustment of Rent Should a portion of the premises be condemned and the rent be reduced as provided above, the reduced rent shall continue to be subject to adjustment and reevaluation in accordance with Article 4. 13.5 Compensation Landlord shall be entitled to receive and shall receive all compensation for the condemnation of all or any portion of the premises by exercise of eminent domain except as hereinafter provided. Tenant shall be entitled to that portion of said compensation which represents the present worth as of the date possession is taken by the public entity of the remaining use under the Lease of all improvements constructed by Tenant on the leased premises located within the part taken by the public entity. Tenant may also assert a claim for loss of business goodwill under the provisions of Section 1263.510 of the California Code of Civil Procedure. Tenant shall assert no claim for loss of bonus value. For the purposes of this Article, "condemnation bonus value" means that value attributable to the fact that the rental rate Tenant is obligated to pay under this Lease is less than the fair market lease rate of the premises as defined in Article 4 above. If all or a portion of the leased premises is condemned at a time when Tenant possesses an interest in real property located outside the leased premises (hereinafter called "outside property"), Tenant may claim entitlement to an award of damages accruing to the outside property by reason of the severance therefrom of the condemned portion of the leased premises as provided in the Eminent Domain Law (California Code of Civil Procedure Sections 1230.010 through 1273.050). ARTICLE 14. UTILITIES Tenant shall pay when due, and shall hold Landlord harmless from any liability for, all charges for water, gas, heat, light, power, telephone, sewage, air conditioning and ventilating, scavenger, janitorial and landscaping services and all other materials and utilities supplied to the Premises. Landlord shall not be liable in damages or otherwise for any failure or interruption of any utility service furnished to the Premises, and no such failure or interruption shall entitle Tenant to terminate this Lease. ARTICLE 15. DEFAULT 15.1 Default The occurrence of any of the following shall constitute a material breach and default of this Lease by Tenant. (a) Any failure by Tenant to pay rent or any other monetary sums required to be paid hereunder, where such failure continues for ten (10) days after written notice thereof has been given by Landlord to Tenant. 22 (b) The abandonment or vacation of the Premises by Tenant. Failure to occupy and operate the Premises for thirty (30) consecutive days following the mailing of written notice from Landlord to Tenant calling attention to the abandonment shall be deemed an abandonment or vacation. (c) The making by Tenant of any general assignment or general arrangement for the benefit of creditors; the filing by or against Tenant of a petition to have Tenant adjudged bankrupt or of a petition for reorganization or arrangement under any law relating to bankruptcy (unless, in the case of a petition filed against Tenant the same is dismissed within sixty (60) days); the appointment of a trustee or receiver to take possession of substantially all of Tenant's assets, where possession is not restored to Tenant within forty-five (45) days; or the attachment, execution or other judicial seizure of substantially all of Tenant's assets, where such seizure is not discharged within thirty (30) days. (d) The failure by Tenant to comply with any provision of any law, statute, zoning restriction, ordinance or governmental rule, regulation or requirement as set forth in Section 5.3 of this Lease. (e) The failure by Tenant to comply with the requirements of the Lease Application. (f) The failure by Tenant to comply with the requirements regarding hazardous materials as set forth in Article 5 of this Lease. (g) The construction by Tenant of any improvements on the Premises contrary to the provisions of Article 6 of this Lease. (h) The failure by Tenant to pay any tax, assessment, imposition, levy or charge of any kind as set forth in Article 11 of this Lease. (i) The failure by Tenant to observe and perform any other provision of this Lease to be observed or performed by Tenant, where such failure continues for thirty (30) days after written notice thereof by Landlord to Tenant; provided, however, that if the nature of such default is such that it cannot be reasonably cured within such thirty (30) day period, Tenant shall not be deemed to be in default if Tenant shall within such period commence such cure and thereafter diligently prosecute the same to completion. 15.2 Landlord's Remedies In the event of any material default or breach by Tenant, Landlord may at any time thereafter, without limiting Landlord in the exercise of any right of remedy at law or in equity which Landlord may have by reason of such default or breach, terminate Tenant's right to possession by any lawful means, in which case this Lease shall immediately terminate and Tenant shall immediately surrender possession of the Premises to Landlord. In such event Landlord shall be entitled to recover from Tenant all damages incurred by Landlord by reason of Tenant's default including, but not limited to, the following: (a) the worth at the time of award of any unpaid rent which had been earned at the time of such termination; plus (b) the worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that is proved could have been reasonably avoided; plus (c) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss that is proved could be reasonably avoided; plus (d) any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant's failure to perform its obligations under this Lease or which in the ordinary course of events would be likely to result therefrom; plus 23 (e) at Landlord's election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by applicable State law. Upon any such re-entry Landlord shall have the right to make any reasonable repairs, alterations or modifications to the premises, which Landlord in its sole discretion deems reasonable and necessary. As used in subparagraphs (a) and (b), above, the "worth at the time of award" is computed by including interest on the principal sum at a rate one percent (1%) above the discount rate of the Federal Reserve Bank of San Francisco from the date of default. As used in subparagraph (c), above, the "worth at the time of award" is computed by discounting such amount at a rate one percent (1%) above the discount rate of the Federal Reserve Bank of San Francisco at the time of award. The term "rent" as used in this Article shall be deemed to be and to mean rent to be paid pursuant to Article 4 and all other monetary sums required to be paid by Tenant pursuant to the terms of this Lease. 15.3 Late Charges Tenant hereby acknowledges that late payment by Tenant to Landlord of rent and other sums due hereunder will cause Landlord to incur costs not contemplated by this Lease, the exact amount of which will be extremely difficult to ascertain. Such costs include, but are not limited to, processing and accounting charges. Accordingly, if any installment of rent or any other sum due from Tenant shall not be received by Landlord or Landlord's designee within ten (10) days after such amount shall be due, a late charge equal to one and one-half percent (1.5%) of the payment due and unpaid plus $100.00 shall be added to the payment, and the total sum shall become immediately due and payable to Landlord. An additional charge of one and one-half percent (1.5%) of such payment, excluding late charges, shall be added for each additional month that such payment remains unpaid. Landlord shall apply any monies received from Tenant first to any accrued delinquency charges and then to any other payments due under the Lease. The parties hereby agree that such late charges represent a fair and reasonable estimate of the costs Landlord will incur by reason of late payment by Tenant. Acceptance of such late charges by Landlord shall in no event constitute a waiver of Tenant's default with respect to such overdue amount, nor prevent Landlord from exercising any of the other rights and remedies granted hereunder. 15.4 Landlord's Right to Cure Tenant's Default At any time after Tenant is in default or material breach of this Lease, Landlord may cure such default or breach at Tenant's cost. If Landlord at any time, by reason of such default or breach, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be due immediately from Tenant to Landlord at the time the sum is paid, and if paid at a later date shall bear interest as provided in Section 19.11 from the date the sum is paid by Landlord until Landlord is reimbursed by Tenant. The sum, together with interest on it, shall be additional rent. ARTICLE 16. ASSIGNMENTS, TRANSFERS, SUBLEASES AND ENCUMBRANCES 16.1 Prohibition on Assignments, Transfers and Subleases Tenant shall not assign, transfer or sublease all or any part of its interest in this Lease or in the Premises, and Landlord reserves the right to deny its consent to any assignment, transfer or sublease of all or any part of this Lease or the Premises. 16.2 Voluntary Assignments and Subleases 24 In addition, with respect to transactions not expressly prohibited under Section 16.1, Tenant shall not voluntarily assign or transfer all or any part of its interest in this Lease or in the Premises, or sublet all or any part of the Premises, or allow any other person or entity (except Tenant's authorized representatives) to occupy or use all or any part of the Premises without first obtaining Landlord's written consent and the concurrence of the Federal Highway Administration. Landlord may, at its sole discretion, elect to consent to any such assignment, transfer or sublease if all of the following express conditions are satisfied: (a) Landlord receives compensation from Tenant upon the assignment, transfer, sale or sublease of any of Tenant's rights in the Premises per the provisions of Article 4.3. (b) The prospective assignee, transferee or subtenant completes a Lease Application and meets all of the requirements for eligibility to lease from the State of California. Tenant's failure to obtain Landlord's required written approval prior to any assignment, transfer or sublease shall render such assignment, transfer or sublease void. Occupancy of the Premises by a prospective transferee, subtenant or assignee before approval of the transfer, sublease or assignment by Landlord shall constitute a breach of this Lease. Landlord's consent to any assignment, transfer or sublease shall not constitute a waiver of any of the terms, covenants or conditions of this Lease. Such terms, covenants and conditions shall apply to each and every assignment, sublease and transfer of rights under this Lease and shall be severally binding upon each and every party thereto. Any document to transfer, sublet, or assign the Premises or any part thereof shall incorporate directly or by reference all the provisions of this Lease. 16.3 Change in Partnership or Limited Liability Partnership If Tenant is a partnership or limited liability partnership, a withdrawal or change, voluntary, involuntary or by operation of law, or the dissolution of the partnership, shall be deemed a voluntary assignment subject to the provisions of Section 16.2. 16.4 Change in Tenants If Tenant consists of more than one person, a purported assignment, voluntary, involuntary or by operation of law, from one tenant to another shall be deemed a voluntary assignment subject to the provisions of Section 16.2. 16.5 Change in Corporation or Limited Liability Company If Tenant is a corporation or limited liability company, any dissolution, merger, consolidation, or other reorganization of Tenant, or the sale or other transfer of a controlling percentage of the capital stock of Tenant, or the sale of 51% of the value of the assets of Tenant, shall be deemed a voluntary assignment subject to the provisions of Section 16.2. The phrase "controlling percentage" means the ownership of, and the right to vote, stock possessing at least 51% of the total combined voting power of all classes of Tenant's capital stock issued, outstanding, and entitled to vote for the election of directors or a controlling interest in the LLC. 16.6 Assignment of Rent from Subtenants 25 Tenant immediately and irrevocably assigns to Landlord, as security for Tenant's obligations under this Lease, all rent from any subletting of all or a part of the Premises as permitted by this Lease, and Landlord, as assignee and attorney-in-fact for Tenant, or a receiver for Tenant appointed on Landlord's application, may collect such rent and apply it toward Tenant's obligations under this Lease; except that, until the occurrence of an act of default by Tenant, Tenant shall have the right to collect such rent. 16.7 Information to be Supplied to Landlord Tenant shall supply Landlord with all information Landlord determines to be necessary on all persons or firms to which Tenant proposes to sublet, transfer or assign any of its interest in the Premises, or which might establish rights to enter, control, or otherwise encumber the Premises by reason of any agreement made by Tenant. In addition, with respect to any proposed sublease, transfer or assignment, Tenant shall provide Landlord with: (a) a copy of all documents relating thereto, (b) a statement of all terms and conditions of said transaction, including the consideration therefor, and (c) a copy of the financial statement of the prospective subtenant, transferee or assignee. (d) a copy of all documents showing compliance by the prospective subtenant, transferee or assignee with all of the bid eligibility requirements contained in the bid package. 16.8 Processing Fees for Assignments, Transfers and Subleases (a) In addition to the sum specified in Section 4.3, a fee of one thousand five hundred dollars ($1,500) shall be paid to Landlord for processing each consent to assignment, transfer, or sublease to Landlord as required by this Lease. This processing fee shall be deemed earned by Landlord when paid and shall not be refundable. (b) If a processing fee has been paid by Tenant for another phase of the same transaction, a second fee will not be charged. (c) The amounts specified above for processing fees shall be automatically adjusted at the end of the first year of this Lease and every year thereafter in accordance with an annual fee schedule adopted by Landlord. Landlord shall make said fee schedule available to Tenant upon receiving a request therefor. 16.9 Encumbrances Tenant shall not encumber the Premises in any manner whatsoever. ARTICLE 17. NONDISCRIMINATION Tenant, for itself, its personal representatives, successors in interest, and assigns, as a part of the consideration hereof, does hereby covenant and agree as a covenant running with the land that: (1) no person, on the ground of race, color, or national origin shall be excluded from participation in, be denied the benefits of, or otherwise subjected to discrimination in the use of said facilities, (2) in connection with the construction of any improvements on said land and the furnishing of services thereon, no discrimination shall be practiced in the selection of employees and contractors, by contractors in the selection and retention of first-tier subcontractors, and by first-tier subcontractors in the selection and retention of second-tier subcontractors, (3) such discrimination shall not be practiced against the public in its access to and use of the facilities and services provided for public 26 accommodations (such as eating, sleeping, rest, recreation, and vehicle servicing) constructed or operated on, over, or under the premises, and (4) Tenant shall use the land in compliance with all other requirements imposed pursuant to Title 49, Code of Federal Regulations, Part 21 (49 C.F.R., Part 21) and as said regulations may be amended. In the event of breach of any of the above nondiscrimination covenants, the Landlord shall have the right to terminate this Lease, and to re-enter and repossess said land and the facilities thereon, and hold the same as if said Lease had never been made or issued. ARTICLE 18. SECURITY DEPOSIT Concurrently with Tenant's execution of this Lease, Tenant shall deposit with Landlord the sum of $ -0- as a Security Deposit. Said sum shall be held by Landlord as a Security Deposit for the faithful performance by Tenant of all of the terms, covenants and conditions of this Lease to be kept and performed by Tenant during the term hereof. If Tenant defaults with respect to any provision of this Lease, including but not limited to the provisions relating to the payment of rent and any of the monetary sums due herewith, Landlord may use, apply or retain all or any part of this Security Deposit for the payment of any other amount which Landlord may spend by reason of Tenant's default or use it to compensate Landlord for any other loss or damage which Landlord may suffer by reason of Tenant's default. If any portion of said Deposit is so used or applied, Tenant shall within ten (10) days after written demand therefor, deposit cash with Landlord in an amount sufficient to restore the Security Deposit to its original amount; Tenant's failure to do so shall be a material breach of this Lease. Landlord shall not be required to keep this Security Deposit separate from its general funds, and Tenant shall not be entitled to interest on such deposit. If Tenant shall fully and faithfully perform every provision of this Lease to be performed by it, the Security Deposit or any balance thereof shall be returned to Tenant at the expiration of the Lease term and after Tenant has vacated the premises. ARTICLE 19. ADDITIONAL PROVISIONS 19.1 Quiet Enjoyment Landlord covenants and agrees with Tenant that upon Tenant paying rent and other monetary sums due under the Lease and performing its covenants and conditions, Tenant shall and may peaceably and quietly have, hold and enjoy the Premises for the term. 19.2 Captions, Attachments, Defined Terms The captions of the Articles of this Lease are for convenience only and shall not be deemed to be relevant in resolving any question of interpretation or construction of any section of this Lease. Exhibits attached hereto, and addenda and schedules initiated by the parties, are deemed by attachment to constitute part of this Lease and are incorporated herein. The words "Landlord" and "Tenant," as used herein, shall include the plural as well as the singular. Words used in neuter gender include the masculine and feminine and words in the masculine or feminine gender include the neuter. If there be more than one Landlord or Tenant, the obligations hereunder imposed upon Landlord or Tenant shall 27 be joint and several. If the Tenants are husband and wife, the obligations shall extend individually to their sole and separate property as well as to their community property. 19.3 Entire Agreement This instrument along with any exhibits and attachments hereto constitutes the entire agreement between Landlord and Tenant relative to the premises and this agreement and the exhibits and attachments may be altered, amended or revoked only by an instrument in writing signed by both Landlord and Tenant. Landlord and Tenant agree hereby that all prior or contemporaneous oral agreements between and among themselves and their agents and representatives relative to the leasing of the premises are merged in or revoked by this agreement. 19.4 Severability If any terms or provision of this Lease shall, to any extent, be determined by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Lease shall not be affected thereby, and each term and provision of this Lease shall be valid and be enforceable to the fullest extent permitted by law. 19.5 Costs of Suit If Tenant or Landlord shall bring any action for any relief against the other, declaratory or otherwise, arising out of this Lease, including any suit by Landlord for the recovery of rent or possession of the premises, the losing party shall pay the successful party a reasonable sum for attorney's fees which shall be deemed to have accrued on the commencement of such action and shall be paid whether or not such action is prosecuted to judgment. Should Landlord, without fault on Landlord's part, be made a party to any litigation instituted by Tenant or by any third party against Tenant, or by or against any person holding under or using the premises by license of Tenant, or for the foreclosure of any lien for labor or materials furnished to or for Tenant or any such other person or otherwise arising out of or resulting from any act or transaction of Tenant or of any such other person, Tenant shall save and hold Landlord harmless from any judgment rendered against Landlord or the premises or any part thereof, and all costs and expenses, including reasonable attorney's fees, incurred by Landlord in connection with such litigation. 19.6 Time, Joint and Several Liability Time is of the essence of this Lease and each and every provision hereof, except as to the conditions relating to the delivery of possession of the premises to Tenant. All the terms, covenants and conditions contained in this Lease to be performed by either party if such party shall consist of more than one person or organization, shall be deemed to be joint and several, and all rights and remedies of the parties shall be cumulative and non-exclusive of any other remedy at law or in equity. 19.7 Binding Effect; Choice of Law The parties hereto agree that all the provisions hereof are to be construed as both covenants and conditions as though the words importing such covenants and conditions were used in each separate section hereof; and all of the provisions hereof shall bind and inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors and assigns. This Lease shall be governed by the laws of the State of California. 28 19.8 Waiver No covenant, term or condition or the breach thereof shall be deemed waived, except by written consent of the party against whom the waiver is claimed and any waiver or the breach of any covenant, term or condition shall not be deemed to be a waiver of any preceding or succeeding breach of the same or any other covenant, term or condition. Acceptance by Landlord of any performance by Tenant after the time the same shall have become due shall not constitute a waiver by Landlord of the breach or default of any covenant, term or condition. Acceptance by Landlord of any performance by Tenant after the time the same shall have become due shall not constitute a waiver by Landlord of the breach or default of any covenant, term or condition unless otherwise expressly agreed to by Landlord in writing. 19.9 Surrender of Premises The voluntary or other surrender of this Lease by Tenant, or a mutual cancellation thereof, shall not work a merger and shall, at the option of the Landlord, terminate all or any existing subleases or subtenancies, or may, at the option of Landlord, operate as an assignment to it of any or all such subleases or subtenancies. 19.10 Holding Over If Tenant remains in possession of all or any part of the premises after the expiration of the term hereof, with or without the express or implied consent of Landlord, such tenancy shall be from month to month only and not a renewal hereof or an extension for any further term, and in such case, rent and other monetary sums due hereunder shall be payable at the time specified in this Lease and such month-to-month tenancy shall be subject to every other term, covenant, condition and agreement contained herein, except that the monthly rental rate set forth in Section 4.1 may be increased by Landlord effective the first month of the holdover period, or upon 30 days notice any time thereafter. 19.11 Interest on Past Due Obligations Except as expressly herein provided, any amount due to Landlord not paid when due shall bear interest at a rate one percent (1%) above the discount rate of the Federal Reserve Bank of San Francisco from the due date. Payment of such interest together with the amount due shall excuse or cure any default by Tenant under this Lease. 19.12 Recording Neither Landlord nor Tenant shall record this Lease. 19.13 Notices All notices or demands of any kind required or desired to be given by Landlord or Tenant hereunder shall be in writing and shall be deemed delivered forty-eight (48) hours after depositing the notice or demand in the United States mail, certified or registered, postage prepaid, addressed to the Landlord or Tenant respectively at the addresses set forth in Article 1. 29 19.14 No Reservation Submission of this instrument for examination or signature by Tenant does not constitute a reservation of or option for lease; it is not effective as a lease or otherwise until execution and delivery by both Landlord and Tenant. 19.15 Corporate Authority If Tenant is a corporation, each individual executing this Lease on behalf of said corporation represents and warrants that he/she is duly authorized to execute and deliver this Lease on behalf of said corporation in accordance with a duly adopted resolution of the Board of Directors of said corporation or in accordance with the Bylaws of said corporation, and that this Lease is binding upon said corporation in accordance with its terms. If Tenant is a corporation, Tenant shall, within thirty (30) days after execution of this Lease, deliver to Landlord a certified copy of resolution of the Board of Directors of said corporation authorizing or ratifying the execution of this Lease. 19.16 Force Majeure If either Landlord or Tenant shall be delayed or prevented from the performance of any act required hereunder by reason of acts of God, governmental restrictions, regulations or controls (except those reasonably foreseeable in connection with the uses contemplated by this Lease) or other cause without fault and beyond the control of the party obligated (except financial inability), performance of such act shall be excused for the period of the delay and the period for the performance of any such act shall be extended for a period equivalent to the period of such delay. Nothing in this clause shall excuse Tenant from prompt payment of any rent, taxes, insurance or any other charge required of Tenant, except as may be expressly provided in this Lease. In Witness Whereof Landlord and Tenant have executed this Lease as of the date first written above. LANDLORD: STATE OF CALIFORNIA DEPARTMENT OF TRANSPORTATION Dated: ________________ By: ____________________________________ LINDA EMADZADEH, Chief R/W Airspace, LPA, and Excess Lands TENANT: CITY OF SOUTH SAN FRANCISCO 30 Dated: ________________ By: ____________________________________ MIKE FUTRELL, City Manager EXHIBIT “A” 31 [Grab your reader’s attention with a great quote from the document or use this space to emphasize a key point. To place this text box anywhere on the page, just drag it.] FLA-SM-101-01 32 33 34 EXHIBIT “B” 35 36 37 38 2838262.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-565 Agenda Date:7/26/2017 Version:1 Item #:7. Report regarding a resolution approving the application for grant funds to the California Natural Resources Agency Environmental Enhancement and Mitigation Program in a total amount of $500,000 for landscape enhancements to the Caltrain Station Improvement Project in Fiscal Year 2017-18.(Tony Rozzi,Senior Planner and Deborah Gill, Special Projects Manager) RECOMMENDATION It is recommended that the City Council adopt a resolution approving the application of grant funds to the California Natural Resources Agency Environmental Enhancement and Mitigation Program in a total amount of $500,000 for landscape enhancements to the Caltrain Station Improvement Project in Fiscal Year (FY) 2017-18. BACKGROUND/DISCUSSION The California state legislature and Governor of the State of California have enacted section 164.56 of the California Streets and Highways Code,which is intended to provide grant funds to local,state and federal agencies and nonprofit entities for projects to enhance and mitigate the environmental impacts of modified or new public transportation facilities. The California Natural Resources Agency has been delegated the responsibility for the administration of this grant program.Due to the grant deadline,staff submitted an application on June 21,2017.However,in order for the application to be considered,the California Natural Resources Agency requires a resolution certifying the approval of an application by the applicant’s governing board. The South San Francisco Caltrain Station Improvement project is a joint effort between the City of South San Francisco and the Peninsula Corridor Joint Powers Board (PCJPB).This project will focus on placemaking enhancements to connect residents and employees to the critical Caltrain transit system. The project will: ·Extend the passenger platform approximately 700 feet and modernize the platform for Caltrain electrification; ·Create anchoring plazas for both the eastern and western sides of the train corridor with high quality lighting, furnishings, landscaping; ·Construct a pedestrian/bicyclist tunnel to link the downtown area and major employers that are currently divided by the US-101 freeway; and ·Increase safety of the station and ridership of the Caltrain system as well as modernize the platform in preparation for Caltrain electrification. The project is located 2,000’from Colma Creek,which feeds stormwater runoff into the San Francisco Bay and is located 5,000’from the San Francisco Bay.The station will add substantial hardscape to the project area, City of South San Francisco Printed on 8/30/2017Page 1 of 2 powered by Legistar™ File #:17-565 Agenda Date:7/26/2017 Version:1 Item #:7. is located 5,000’from the San Francisco Bay.The station will add substantial hardscape to the project area, preventing storm water capture and groundwater refill.The required mitigation is to provide minimum storm water retention per state water quality standards.The environmental enhancement and mitigation incorporated into the project by the City will expand the storm water retention opportunities for the project and benefit Colma Creek and the San Francisco Bay. See Attachment 1 for landscape site plans. The project is designed with biofiltration and rain gardens that will absorb storm water runoff and limit flooding at the low point of the project close to the pedestrian underpass.These storm water features refill the local aquifer,the landscaping palette will collect carbon and limit air pollution,and the reduced hardscaping will provide heat island cooling for both the eastern and western plazas of the project. FUNDING Of the total estimated cost of $1,289,816 for environmental enhancements and mitigation included in the project,$764,816 is budgeted in the City’s FY 2017-18 Capital Improvement Project budget,$25,000 is provided as in-kind support through staff time,and the remaining $500,000 is requested in this grant proposal. Any grant funding secured from the California Natural Resources Agency Environmental Enhancement and Mitigation Program grant application would help to defray the amount the City has allocated to the project. CONCLUSION It is recommended that the City Council adopt a resolution approving the application for grant funds to the California Natural Resources Agency Environmental Enhancement and Mitigation Program in a total amount of $500,000 for landscape enhancements to the Caltrain Station Improvement Project in FY 2017-18. Attachments 1.Site Plans City of South San Francisco Printed on 8/30/2017Page 2 of 2 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-566 Agenda Date:7/26/2017 Version:1 Item #:7a. Resolution approving the application for grant funds to the California Natural Resources Agency Environmental Enhancement and Mitigation Program in a total amount of $500,000 for landscape enhancements to the Caltrain Station Plaza Project in Fiscal Year 2017-18. WHEREAS,the Legislature and Governor of the State of California have enacted Section 164.56 of the California Streets And Highways Code,which is intended to provide grant funds to local,state and federal agencies and nonprofit entities for projects to enhance and mitigate the environmental impacts of modified or new public transportation facilities; and WHEREAS,the California Natural Resources Agency has been delegated the responsibility for the administration of this grant program,establishing necessary procedures and criteria,and is required to submit to the California Transportation Commission a list of recommended projects from which the grant recipients will be selected; and WHEREAS,said procedures established by the California Natural Resources Agency require a resolution certifying the approval of an application by the Applicants governing board before submission of said application to the State; and WHEREAS,the Applicant,if selected,will enter into an agreement with the State of California to carry out the Project. NOW, THEREFORE, BE IT RESOLVED that the CITY OF SOUTH SAN FRANCISCO: 1.Approves the filing of an application for the Caltrain Station Improvement Project in a total amount of $500,000; and 2.Certifies that Applicant understands the requirements in the Program Guidelines; and 3.Certifies that Applicant or title holder will have sufficient funds to operate and maintain the project consistent with the land tenure requirements; or will secure the resources to do so; and 4.Certifies that Applicant will record a document against the real property that defines the State’s interest in the property whether the Grantee owns the property or not; and 5.Certifies that Applicant will comply with the provisions of Section 1771.5 of the State Labor Code regarding payment of prevailing wages on Projects awarded EEM Program Funds; and 6.If applicable,certifies that the project will comply with any laws and regulations including,but not City of South San Francisco Printed on 8/30/2017Page 1 of 2 powered by Legistar™ File #:17-566 Agenda Date:7/26/2017 Version:1 Item #:7a. 6.If applicable,certifies that the project will comply with any laws and regulations including,but not limited to,legal requirements for building codes,health and safety codes,disabled access laws, environmental laws and,that prior to commencement of construction,all applicable licenses and permits will have been obtained; and 7.Certifies that Applicant will work towards the Governor’s State Planning Priorities intended to promote equity,strengthen the economy,protect the environment,and promote public health and safety as included in Government Code Section 65041.1; and 8.Appoints the City Manager,or designee,as agent to conduct all negotiations,execute and submit all documents including,but not limited to applications,agreements,payment requests etc.,which may be necessary for the completion of the aforementioned project. ***** City of South San Francisco Printed on 8/30/2017Page 2 of 2 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-760 Agenda Date:7/26/2017 Version:1 Item #:8. Report regarding a resolution authorizing the City Manager to execute the Construction and Maintenance Agreement for the South San Francisco Caltrain Station with the Peninsula Corridor Joint Powers Board. (Marian Lee, Assistant City Manager and Tony Rozzi, Senior Planner) RECOMMENDATION It is recommended that City Council adopt a resolution authorizing the City Manager to execute the Construction and Maintenance Agreement for the South San Francisco Caltrain Station with the Peninsula Corridor Joint Powers Board (PCJPB). BACKGROUND The City of South San Francisco and the Peninsula Corridor Joint Powers Board (PCJPB)secured funding to upgrade the South San Francisco Caltrain Station (“Project”)in December 2015.The Project was estimated to cost up to $59 million.As outlined in the existing agreement,the City committed to contributing 10 percent ($5.9 million)of the Project cost.Two amendments were made to the funding agreement related to enhancing the station beyond the standards provided by the PCJPB: ·On January 25,2017,City Council approved an additional $1.3 million to incorporate structural design changes that maximize the pedestrian experience and encourage Caltrain Station use. ·On May 10,2017,City Council approved an additional $1.5 million to install high quality finish and paving materials and landscaping to the Project. The City’s contribution to the Project totals $8.7 million. The PCJPB received bids for Project construction and has informed the City that the Capital funding for the Project is sufficient.The bid includes the City-requested changes to the design and finish materials.PCJPB staff has scheduled bid award for the August 3,2017 PCJPB meeting.Prior to award,PCJPB requests an executed construction and maintenance agreement (C&M Agreement)with the City.This C&M Agreement is the subject of this staff report. See Exhibit A attached to the associated resolution for the draft C&M Agreement. DISCUSSION The C&M Agreement is a typical template used by PCJPB with their respective agency partners for station improvement projects.The construction section of the agreement is typical and states that the PCJPB is responsible for the implementation of the station improvements with appropriate level of coordination and support from the City. The maintenance section clarifies roles and responsibilities for both PCJPB and the City. PCJPB will maintain all typical station areas:station platform,parking lot,pedestrian underpass,railroad right- City of South San Francisco Printed on 8/30/2017Page 1 of 2 powered by Legistar™ File #:17-760 Agenda Date:7/26/2017 Version:1 Item #:8. PCJPB will maintain all typical station areas:station platform,parking lot,pedestrian underpass,railroad right- of-way,and pump station.PCJPB standard maintenance of the station includes maintenance of CCTV,ticket vending machines,public address/communication system,pedestrian shelters,trash/debris/graffiti management, any necessary repairs, and regular sweeping and power wash cleaning of surfaces. City maintenance will focus on the east plaza,west plaza and Poletti way,which are the public areas providing access to the station.City maintenance efforts will include trash/debris/graffiti management,landscaping, lighting repair,and regular sweeping and power wash cleaning as needed.A particular note -PCJPB will be responsible for all regular maintenance in the pedestrian underpass but the City will be responsible for any specialty light programming and repair,maintenance of all specialty wall finishes,and any “hot spot”graffiti or trash/debris management.The City’s role will ensure prompt action if there is periodic debris or homeless challenges within the pedestrian underpass. FUNDING City maintenance expenses will not be incurred until construction is completed in fall 2019.The related maintenance efforts will be included in the upcoming budget requests to City Council by the Public Works and Parks and Recreation departments. The current estimate for yearly maintenance by the City is approximately $50,000/year: ·Parks and Recreation: $12,000 in staff costs and $3,000 in materials ($15,000/year) ·Public Works: $30,000 in staff costs and $3,500 in equipment rentals ($33,500/year) The City is being asked to cover these costs as they are beyond what the PCJPB typically apply to their stations and is generally the result of City-requested enhancements and the City’s desire for a higher level of maintenance than what is typically provided by the PCJPB. CONCLUSION Staff recommends City Council approval of the C&M Agreement.Approval of the resolution will allow the City Manager to execute the agreement, a necessary step for project construction. City of South San Francisco Printed on 8/30/2017Page 2 of 2 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-728 Agenda Date:7/26/2017 Version:1 Item #:8a. Resolution authorizing the City Manager to execute the Construction and Maintenance Agreement for the South San Francisco Caltrain Station with the Peninsula Corridor Joint Powers Board. WHEREAS,on December 9,2015,Peninsula Corridor Joint Powers Board (“PCJPB”)and the City of South San Francisco (“City”)entered into a Cooperative Agreement,pursuant to which City contracted with PCJPB to perform or contract for the performance of all design,project management,construction management, construction engineering and reconstruction related to the South San Francisco Caltrain Station (“Project”); and WHEREAS,PCJPB requires the execution of a construction and maintenance agreement (“C&M Agreement”) and evidence of a State of California Department of Transportation (“Caltrans”)Airspace Lease between Caltrans and City before awarding a contract to the qualified lowest bidder for the Project; and WHEREAS,a C&M Agreement will set forth the roles and responsibilities of PCJPB and City for construction and maintenance obligations moving forward; and WHEREAS,this C&M Agreement will provide clarity and accountability for all ongoing maintenance related to PCJPB right-of-way and City right-of-way,and any shared responsibilities to ensure a high quality and safe, functional Project; and WHEREAS,the City will need to execute a C&M Agreement with PCJPB prior to PCJPB award of contract scheduled for August 3, 2017; and WHEREAS,the costs for construction management and maintenance are accounted for in the Cooperative Agreement and/or will be accounted for in future operating budgets for affected City Departments. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council hereby approves a Construction and Maintenance Agreement for the South San Francisco Caltrain Station with the Peninsula Corridor Joint Powers Board, attached hereto as Exhibit A. BE IT FURTHER RESOLVED that the City Council of the City of South San Francisco authorizes the Finance Department to establish an ongoing maintenance budget to include the estimated costs consistent with the information contained in the staff report. BE IT FURTHER RESOLVED that the City Council hereby authorizes the City Manager to execute this City of South San Francisco Printed on 8/30/2017Page 1 of 2 powered by Legistar™ File #:17-728 Agenda Date:7/26/2017 Version:1 Item #:8a. BE IT FURTHER RESOLVED that the City Council hereby authorizes the City Manager to execute this Construction and Management Agreement for the South San Francisco Caltrain Station with the Peninsula Corridor Joint Powers Board on behalf of the City in substantially the same form as attached hereto as Exhibit A;to make any revisions,amendments,corrections and modifications,subject to the approval of the City Attorney,deemed necessary to carry out the intent of this Resolution and which do not materially alter or increase the City’s obligations thereunder;and to take any related action reasonably necessary to carry out the intent of this Resolution. ***** City of South San Francisco Printed on 8/30/2017Page 2 of 2 powered by Legistar™ 13526858.4 RAILROAD CONSTRUCTION AND MAINTENANCE AGREEMENT SOUTH SAN FRANCISCO STATION IMPROVEMENTS PROJECT This Railroad Construction and Maintenance Agreement (“Agreement”) is entered into this _______ day of __________________, 2017, by and between the Peninsula Corridor Joint Powers Board, a public agency (“JPB”), and the City of South San Francisco, a municipal corporation (“City”). The JPB and City are collectively referred to herein as "Parties." RECITALS A. City is a duly established municipal corporation organized and existing under the laws of the State of California; B. JPB is a public agency organized and existing under the laws of the State of California; C. JPB, in conjunction with the San Mateo County Transit District, is the owner of the Peninsula Corridor railroad right-of-way, and specifically that certain real property and fixtures located in the City of South San Francisco between MP 8.9 and MP 9.6 (“Right of Way”). JPB also is the owner of the Caltrain South San Francisco Station property located west of the Right of Way. City is the owner of the property to the east of the Right of Way, known as the East Plaza/Ramp Area (“East Plaza Area”), the Bus Shuttle Drop-Off Area ("Shuttle Area"), and the property to the south of the Station property and west of the Right of Way (“West Plaza Area”), all as depicted on Exhibit A, which is attached hereto and incorporated herein by this reference. The areas depicted on Exhibit A are collectively referred to as the Project area ("Project Area"); D. The City wishes to cooperate with JPB in the JPB’s design, construction and maintenance of certain improvements to JPB’s South San Francisco Caltrain Station (the “Project”) and will be constructed pursuant to JPB’s Contract No. 17-J-C-063 South San Francisco Station Improvements ("Construction Contract”); E. The City desires that the Project include the construction of a pedestrian access underpass, at the south end of JPB’s new station platforms, that connects Airport Boulevard and Poletti Drive with a connection to the JPB platform, and City will provide the property rights necessary to construct that underpass ("Underpass"); F. On December 9, 2015, the JPB and the City entered into a Cooperative Agreement for the Project ("Coop Agreement"), pursuant to which the JPB will perform or contract for the performance of all design, project management, construction management, construction engineering and reconstruction related to the Project; G. Pursuant to the Coop Agreement, City agreed to pay JPB a sum not to exceed Five Million, Nine Hundred Thousand Dollars ($5,900,000) towards the Project, including all planning, design, construction/project management, inspection and administration necessary for reconstruction of the South San Francisco Caltrain Station; H. In October 2016, the City requested revisions to the original 2008 Project design to optimize the safety and pedestrian experience at the South San Francisco Caltrain Station, by altering the Project’s ramp and retaining wall geometry and profiles, plaza architectural theme, and drainage and lighting system (“Design Changes”); JPB-CSSF SSF Station Project C&M Agreement 2 13526858.4 I. As of August 3, 2017 the Parties amended the Coop Agreement twice to incorporate the Design Changes which increased the overall costs of the Project and the City’s contribution by up to Two Million, Eight Hundred Thousand Dollars ($2,800,000) for a total City contribution of Eight Million, Seven Hundred Thousand Dollars ($8,700,000) for the Project; and J. Whereas, the Project is exempt from review under the California Environmental Quality Act ("CEQA"); and K. The Parties now desire to set forth herein their understandings and agreements relating to construction and maintenance of the Project. AGREEMENT NOW, THEREFORE, in consideration of the foregoing, the Parties agree as follows: 1. Project Improvements. The Project includes the following improvements: a. Demolition, hazardous material abatement, off hauling and site grading throughout the Project Area. b. Relocation of utilities from the existing location, which are in conflict with the Underpass, to an alignment crossing the West Plaza Area. c. Construction of the Underpass. d. Relocation and reconstruction of various tracks at the South San Francisco Station. e. Construction of new medians, traffic islands, curb and gutter, paving and sidewalk at the Shuttle Area. f. Construction of a new loading area for shuttle buses at Shuttle Area. g. Striping and curve markings at the intersection of 101 northbound Grand Avenue Off-Ramp, Grand Avenue, and Poletti Drive. h. Construction of a new center platform ("Center Platform") which includes a center ramp which connects the Center Platform to the Underpass ("Center Ramp") and stairs from the Center Platform to the Underpass, all as shown in Exhibit A, with all corresponding furniture, electronics, shelters at the South San Francisco Station. i. Other minor track work to upgrade access and facilitate use of the new track. j. Replacing the current signal cantilever at the north side of the South San Francisco Station with a new signal bridge. k. Fencing and pedestrian access control measures, as required. JPB-CSSF SSF Station Project C&M Agreement 3 13526858.4 l. All other necessary construction activities required to build the above, including all necessary changes to telephone, telegraph, signal, electrical lines and appurtenances, relocation of all utilities and pipelines of any kind, all temporary and permanent track work (if necessary), grading, drainage, access roadways to the Right of Way, preliminary and construction engineering, and any and/or all other work of every kind and character necessary to build the above and complete the Project in accordance with the Construction Contract. 2. Project Costs. The JPB and City will bear the costs of the Project as described in the Coop Amendment and any amendments thereto. In addition, the City will be responsible for its own costs related to the Project, including costs for time that its staff or consultants spend on review of design or inspections and any costs associated with the design, selection and installation of Art, as that term is defined below. City will waive all City permit fees or other fees with regard to the Project and all work associated with the Project. The City and JPB will be responsible for maintaining and providing security for the Underpass in accordance with the maintenance responsibilities outlined in Section 12 below. 3. Additional Work. The City may request in writing that the JPB add additional improvements to the Project. The JPB will retain the authority at its sole discretion to either add or not to add additional items requested by the City and will not be required to accept any additional improvements requested by the City. The City will be responsible for costs incurred by the JPB for the additional work requested by the City including labor, materials, tools, equipment, design, construction, construction management, indirect Project costs, the JPB's cost to consider the City's requested change, and costs of delay or time extensions. Such work must be memorialized in a change order. If the City requests the substitution of any material, or product described in the Project with a material or product having greater cost associated with it than the corresponding material described in the Project, and the JPB agrees to such substitution, then the City will pay for additional costs incurred by the JPB for all labor, materials, tools, equipment, design, construction, construction management and indirect Project costs incurred by the JPB above and beyond that which the original material or product would have cost the JPB under the Construction Contract. 4. Construction Standards/Design. JPB will oversee the Contractor’s daily activities and confirm the materials and work conform to the Project requirements. For work constructed outside the Right of Way or for upgrades from JPB’s typical station features specifically requested by City, JPB will furnish Contractor submittals such as product data information and shop drawings, to City and provide fourteen (14) calendar days for City to complete review of submittals. If the City does not provide the JPB with written comments within the aforementioned period of time, City will be deemed to have accepted the submittals. 5. Schedule. The Construction Contract is expected to be awarded by JPB in August of 2017, and the work completed within approximately 22 months from the issuance to the contractor of a notice to proceed. It is understood, however, that the JPB’s Construction Contract will contain its standard provisions providing contractors with time extensions for excusable delays. JPB-CSSF SSF Station Project C&M Agreement 4 13526858.4 6. Real Property Conveyances. Prior to the award of the Construction Contract, the City must: a. Obtain a permanent easement described in Exhibit A for work within the Comfort Suite Inn parking lot (the "Comfort Suite Easement"). The City is solely responsible for obtaining the Comfort Suite Easement and for all coordination with the Comfort Suite Inn; b. Obtain a lease for Caltrans' airspace located above the West Plaza Area, as described in Exhibit A, for work within Caltrans' Airspace (the "Caltrans Airspace Lease") prior to the issuance of the Construction Contract. The City is solely responsible for obtaining the Caltrans Airspace Lease, for fulfilling the obligations contained therein, and for all coordination with Caltrans; and c. Make available to the JPB all City property, including the Comfort Suite Easement and West Plaza, shown in Exhibit A through issuance of a temporary encroachment permit ("Encroachment Permit") in the form attached to this Agreement as Exhibit B incorporated herein by this reference, as more fully described in Sections 7 and 11 below. 7. Prerequisites to Construction: Before JPB awards the Construction Contract, City must complete items a, b, and c below. If these items have not been completed, in a form satisfactory to JPB, by July 31, 2017, JPB will have no further obligation to construct the Underpass and will build the remainder of the Project without constructing the Underpass: a. Provide JPB an executed copy of the Encroachment Permit for all City property as described in Exhibit A and grant or caused to be granted the Comfort Suite Easement. City also will provide pre-approval, upon due review and comment, of the Encroachment Permit, defined below, for the Project prior to the JPB advertising for bids for the Construction Contract; b. Provide JPB an executed copy of the Caltrans Airspace Lease c. Provide JPB an executed copy of this Agreement. 8. City Underpass/Access to Right of Way. For the purpose of maintaining the Underpass located in the Right of Way, no later than 90 days following its final acceptance of the Project, JPB will grant to City a license in a form agreeable to both parties. 9. Utility Relocations. The JPB is solely responsible, subject to payment of costs as addressed in Sections 2 and 3, for identifying the location of all pipelines (including, without limit, high pressure petrol pipelines, gas and water pipelines), fiber optic lines and all other utilities of whatever nature (“Facilities”) to accommodate construction of the Project, and for relocating or arranging for the relocation of all such Facilities that would interfere with construction of the Project. JPB is responsible for contacting and working with the owners of these Facilities to identify their exact location and arrange for relocation as needed. Nothing herein precludes the JPB from seeking reimbursement for Facilities relocation costs and liabilities from third parties such as the Facilities owners themselves. Notwithstanding the above, to the extent that Facilities are owned by City, City will accomplish their relocation at its JPB-CSSF SSF Station Project C&M Agreement 5 13526858.4 own cost. City and JPB will work cooperatively to minimize the cost of utility relocations, which costs will be borne by the Project. 10. Public Art/Murals. If City wishes to install or erect art, including a mural, in the Project Area ("Art"), it must follow the process set forth above in Section 3. In addition, it must first obtain from the artist designing the art a waiver of the Visual Artists Rights Act, 17 U.S.C §§106A and 113(d) (“VARA”), the California Art Preservation Act, Cal. Civil Code §§ 987 and 989 (“CAPA”), and any rights arising under United States federal or state law or under the laws of another country that convey rights of the same nature as those conveyed under VARA and CAPA, as against the JPB, it directors officers, employees and agents. The JPB has the absolute right in its sole discretion to change, modify, destroy, remove, relocate, move, replace, transport, repair or restore the Art. The City must coordinate with the JPB on the design, selection and installation of any Art. The City will pay for all costs associated with the Art. 11. Permitting, Approvals and Construction Contract Requirements. a. Environmental Review. JPB will be the lead agency under CEQA and will obtain any required environmental clearance for the Project. JPB’s contractor will be subject to all applicable Storm Water Pollution Prevention Plan requirements, including current standard best management practices, including, but not limited to, control of run-off, dust, and mud. b. Inspections and Reporting. JPB or its contractor will provide all flagging and engineering inspection required in connection with construction of the Project. For work associated with Construction submittals City reviewed, JPB will request City inspection seventy-two (72) hours prior to the installation of the work. Corrections to work so it is in conformance with the Project requirements will be made upon results of City’s inspection. Once the work is installed, JPB will request written concurrence from City that work conforms to Project requirements. JPB will keep City informed of progress of construction upon request and will coordinate public outreach with City. City will designate point of contact for construction coordination. JPB will consult with City on any changes to the Construction Contract plans that affect work on the Underpass, Shuttle Area, Poletti Drive street improvements, East Plaza Area and West Plaza Area. c. City Permits and Approvals. To facilitate the construction of the improvements, City will grant to the JPB all Encroachment Permits. The City confirms that to the best of its knowledge, it has the ability to issue and enforce the Encroachment Permit over all City properties as required to effect reconstruction of the streets as contemplated in the project design, including the East Plaza Area, Shuttle Area, West Plaza Area, and Comfort Suite Easement. The Caltrans Airspace Lease with the City does not constitute an encroachment permit, and the JPB will acquire a Caltrans encroachment permit for entry into any Caltrans right of way. City will provide pre-approval, upon due review and comment, of the Encroachment Permit for the Project prior to the JPB awarding the Construction Contract. City will issue a Haul Route Permit, if required, for routes along City streets between work areas and State highways. 12. Maintenance. Upon completion of construction, JPB-CSSF SSF Station Project C&M Agreement 6 13526858.4 a. JPB shall maintain the following improvements at their own expense: i. All improvements associated with railroad, including improvements to track structures and signals; ii. All fencing installed along Right of Way; iii. Drainage improvements located within Right of Way up to the point of discharge to the City owned drainage system as applicable; iv. Low impact development (LID) features such as bioswales, storm water retention strips/basins, storm water treatment strips/basins, and fabricated storm water filtration devices installed within the Right of Way; v. Station parking lot ("Station Parking Lot") as depicted in Exhibit A; vi. Center Platform, including stairs connecting Underpass to platform, closed circuit television, ticket vending machines, public address system, communication system, and shelters; vii. Center Ramp that provides ADA access from the Underpass to the Center Platform; viii. Underpass structure, including fire safety system, drainage system, pump station at base of the east ramp in the East Plaza Area, and closed circuit television. Underpass lighting and finishes installed per City’s request are excluded from JPB’s maintenance responsibilities; ix. Lighting and water utilities for the Station Parking Lot, Center Platform, and Center Ramp; and x. Frequency of maintenance activities, such as emptying of trash receptacles, washing and cleaning of parking lot surfaces, Center Platform and Center Ramp concrete surfaces, Underpass floors and walls, and abatement of graffiti, shall be performed based on JPB’s typical schedule. b. City shall maintain the following improvements at its own expense: i. All street improvements along Poletti Drive, including the Shuttle Area, street section and paving, sidewalks, curbs, gutters, striping, median landscaping, fences, lighting, power for lighting, and new drainage elements/system. JPB-CSSF SSF Station Project C&M Agreement 7 13526858.4 ii. Low impact development (LID) features such as bioswales, storm water retention strips/basins, storm water treatment strips/basins, and fabricated storm water filtration devices installed along Poletti Drive and in the East Plaza Area and West Plaza Area; iii. Landscaping, including water utilities, for the East Plaza Area and West Plaza Area; iv. Lighting and power for lighting for the East Plaza Area and West Plaza Area; v. Art; vi. DMX Lighting controller and wall finishes within Underpass. DMX lighting controller shall be programmed so it conforms to JPB’s standard lighting criteria. vii. City may supplement JPB’s typical station maintenance activities at the City's sole cost on an as-needed basis as follows: (1) Abatement of graffiti observed on Underpass, Ramps, or Plaza walls not abated within two (2) days of first observation; (2) Removal of trash or debris dumped within the Underpass; (3) Repair and cleaning of damage or disruption to general tidiness caused by homeless transients within the Underpass; and (4) Removal of homeless transients and their belongings occupying the Underpass, East Plaza Area, or West Plaza Area. viii. City will notify and obtain approval from the JPB at least eight (8) hours in advance of any supplemental maintenance activity they wish to conduct within the Underpass. 13. Indemnity. a. City’s Indemnity. City will fully release, indemnify, hold harmless and defend the JPB, SamTrans, the City and County of San Francisco, the Santa Clara Valley Transportation Authority, the operator of the JPB's commuter rail service, currently TransitAmerica Services, the operator of the JPB's freight services, currently Union Pacific Railroad Company, and/or their respective officers, directors, employees, contractors and agents (collectively, “JPB Indemnitees”) from and against all liability, claims, suits, sanctions, costs or expenses for injuries to or death of any person (including, but not limited to, the passengers, employees and contractors of JPB), and damage to or loss of property arising out of or resulting JPB-CSSF SSF Station Project C&M Agreement 8 13526858.4 from any negligent act or omission by City, its agents, employees, contractors or subcontractors in the maintenance of the items for which it is responsible or in the performance of any other obligation in this Agreement. City’s obligation to defend includes the payment of all reasonable attorney’s fees and all other costs and expenses of suit, and if any judgment is rendered against any JPB Indemnitee, City will, at its expense, satisfy and discharge the same. b. City’s Hazardous Material Indemnity: i. For purposes of this Agreement, “Hazardous Material” means material that, because of its quantity, concentration or physical or chemical characteristics, is at any time now or hereafter deemed by any federal, state or local governmental authority to pose a present or potential hazard to public health, welfare or the environment. Hazardous Material includes, without limitation, any material or substance defined as a “hazardous substance, pollutant or contaminant” pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections 9601 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. 6901 et seq.) or pursuant to Section 25316 of the California Health and Safety Code, a “hazardous waste” listed pursuant to Section 25140 of the California Health and Safety Code, any asbestos and asbestos containing materials whether or not such materials are part of the property or are naturally occurring substances on the property, and any petroleum, including, without limitation, crude oil or any fraction thereof, natural gas or natural gas liquids. ii. The City will defend, indemnify and hold JPB Indemnitees harmless from any and all costs, claims and liability associated with Hazardous Materials present on or released from City property, including the East Plaza Area, West Plaza Area, Shuttle Area, Comfort Suite Easement and Caltrans Airspace Lease, regardless of whether such liability arises during or after the term of this Agreement. In the event that Hazardous Materials are present, the City will, without cost to the JPB and in accordance with all laws and regulations, pay any additional costs incurred by the JPB's contractor and take all action necessary to mitigate the release or minimize the spread of contamination, remove all contamination, and provide notice in compliance with applicable laws. The City must afford the JPB a full opportunity to participate in any discussion with governmental agencies regarding any settlement agreement, cleanup or abatement agreement, consent decree or other compromise proceeding involving Hazardous Materials. c. JPB’s Indemnity. JPB will fully release, indemnify, hold harmless and defend the City and its respective officers, directors, employees, contractors and agents (collectively, “City Indemnitees”) from and against all liability, claims, suits, sanctions, costs or expenses for injuries to or death of any person (including, but not limited to, passengers, employees and contractors of JPB) and damage to or loss of property arising out of or resulting from any negligent act or omission by the JPB, its agents, employees, contractors or subcontractors in performance of its obligations under this Agreement. JPB’s obligation to defend will include the payment of all reasonable attorney’s fees and all other costs and expenses of suit, and if any judgment is rendered against City Indemnitee’s or any one of them, JPB will, at its expense, satisfy and discharge the same, so long as said claim has been timely tendered to the JPB without prejudice to JPB’s rights and/or abilities to undertake a defense of said claim. JPB-CSSF SSF Station Project C&M Agreement 9 13526858.4 d. JPB's Hazardous Materials Indemnity. The JPB will be responsible for the removal of any Hazardous Materials on its Right of Way. e. Severability. It is the intention of the Parties that should any term of this indemnity provision, Section 13, be found to be void or unenforceable, the remainder of the provision will remain in full force and effect. f. Survival. This indemnity provision, Section 13, will survive the expiration or termination of this Agreement. 14. Insurance. JPB will include in its Construction Contract a requirement that the City be named an additional insured on all policies of insurance required of its contractors. 15. Performance Bond. JPB will require its contractor to provide performance and payment bonds in the full amount of the Construction Contract and will require a one-year warranty period. City agrees to not require additional bonds of JPB’s contractor. The bond will be maintained in full force and effect during the entire period that work is performed by the contractor until such work is accepted by City or JPB. With respect to Underpass, Shuttle Area, East Plaza Area, and West Plaza Area, JPB will not accept the work related to such facilities for purposes of this Section until it has received notice from City that such work is acceptable. 16. Notices. All notices, payments, requests, demands and other communications to be made or given under this Agreement must be in writing and will be deemed to have been duly given on the date of service if served personally or on the second day after mailing if mailed to the party to whom notice is to be given by first class mail, registered or certified, postage prepaid and properly addressed as follows: CITY: City of South San Francisco 400 Grand Avenue South San Francisco, CA 94080 Attn: City Manager JPB: Peninsula Corridor Joint Powers Board 1250 San Carlos Avenue San Carlos, CA 94070 Attn: JPB Secretary 17. Governing Law. This Agreement will be interpreted, construed and enforced in accordance with the laws of the State of California as applied to contracts that are made and performed entirely in California. 18. Successors. This Agreement is binding upon and inures to the benefit of the respective successors and assigns of the Parties hereto. 19. No Third Party Beneficiaries. Nothing herein may be considered as creating any rights and/or obligations by any of the Parties to this Agreement to any third parties. JPB-CSSF SSF Station Project C&M Agreement 10 13526858.4 Specifically, none of the duties to inspect or maintain will in any way be construed as creating or expanding any additional obligations to any third party beyond those required and established under the applicable statutes, regulations, ordinances or law. 20. Amendments. This Agreement may be amended only in a writing that is executed by all the Parties hereto. 21. Entire Agreement. This Agreement constitutes the entire agreement of the Parties with respect to its subject matter and supersedes any prior or contemporaneous oral or written understandings on the same subject. The Parties intend this Agreement to be an integrated agreement. 22. Counterparts. This Agreement may be executed in counterparts, each of which is deemed an original but all of which together constitute a single agreement. 23. Attorneys’ Fees. In any action at law or in equity, arbitration or other proceeding arising in connection with this Agreement, the prevailing party will recover reasonable attorney’s fees and other costs, including but not limited to court costs and expert and consultants’ fees incurred in connection with such action, in addition to any other relief awarded. 24. Severability. If any term, provision, or condition of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Agreement will continue in full force and effect unless the rights and obligations of the Parties have been materially altered or abridged thereby. 25. Waiver. A waiver by either party of the performance of any covenant or condition herein will not invalidate this Agreement nor will the delay or forbearance by either party in exercising any remedy or right be considered a waiver of, or an estoppel against, the later exercise of such remedy or right. JPB-CSSF SSF Station Project C&M Agreement 11 13526858.4 IN WITNESS WHEREOF, the Parties have entered into this Agreement on the date first written above with the intent to be intentionally bound. PENINSULA CORRIDOR JOINT POWERS BOARD Signed: ___________________________________ Jim Hartnett Executive Director Attest: ____________________________________ Martha Martinez JPB Secretary Approved as to Form: ___________________________________ Attorney CITY OF SOUTH SAN FRANCISCO Signed: _____________________________________ Mike Futrell City Manager Approved as to Form: _____________________________________ City Attorney 2838081.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-780 Agenda Date:7/26/2017 Version:1 Item #:9. Motion to approve the Minutes from the meeting of July 12, 2017. City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-758 Agenda Date:7/26/2017 Version:1 Item #:10. Motion confirming payment registers for July 26, 2017.(Richard Lee, Director of Finance) The payments shown in the attached payment register are accurate and sufficient funds were available for payment (payroll items excluded). Attachment: Payment Register City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-719 Agenda Date:7/26/2017 Version:2 Item #:11. Motion to cancel the Regular City Council meeting on August 23, 2017.(Mike Futrell, City Manager) RECOMMENDATION It is recommended that the City Council,by motion,cancel the Regular City Council meeting of August 23, 2017. CONCLUSION Cancellation of the August 23,2017 Regular City Council meeting will not result in an adverse effect on City business. City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-730 Agenda Date:7/26/2017 Version:1 Item #:12. Report regarding a resolution authorizing the acceptance of $25,536 in grant funding from the San Mateo County Human Services Agency to support the Library and Parks and Recreation Departments’Science Technology Engineering and Math education component of the After School Education and Safety programs and amending the Library Department’s Fiscal Year 2017-18 operating budget.(Valerie Sommer,Library Director) RECOMMENDATION It is recommended that the City Council adopt a resolution authorizing the acceptance of $25,536 in grant funding from the San Mateo County Human Services Agency to support the Parks and Recreation and Library Departments’After School Education and Safety (ASES)programs and amending the Library Department’s Fiscal Year (FY) 2017-18 operating budget. BACKGROUND/DISCUSSION In June 2017,the Library and Parks and Recreation Departments applied for grant funding from the San Mateo County Human Services Agency to support STEM education for the ASES programs at the Community Learning Center and Los Cerritos and Martin Elementary Schools.In July 2017,a grant in the amount of $25,536 was awarded to engage low-income students and their families in STEM learning through hands-on science and MakerSpace activities,raise participant awareness of skills needed for a role in a STEM workforce through project-based learning, and support the coordination of the Bay Area STEM Ecosystem. FUNDING Grant funds will be used to amend the Library Department’s current FY2017-18 operating budget.Receipt of these funds does not commit the City to ongoing funding. CONCLUSION Receipt of these funds will support the Library and Parks and Parks and Recreation ASES programs STEM education for low-income students and their families.It is recommended that the City Council adopt a resolution accepting $25,536 in grant funding and amending the Library Department’s FY2017-18 operating budget. City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-731 Agenda Date:7/26/2017 Version:1 Item #:12a. Resolution authorizing the acceptance of $25,536 in grant funding from the San Mateo County Human Services Agency to support the Library and Parks and Recreation Departments’Science Technology Engineering and Math education component of the After School Education and Safety programs and amending the Library Department’s Fiscal Year 2017 -18 operating budget. WHEREAS,the City of South San Francisco (“City”)Library and Parks and Recreation Departments operate After School Education and Safety Program (ASES)sites at the Community Learning Center,Martin Elementary School and Los Cerritos Elementary School; and WHEREAS,in July 2017,the San Mateo County Human Services Agency awarded a grant to the City in the amount of $25,536 to fund Science,Technology,Engineering and Math (STEM)programming as part of the ASES after-school homework programs; and WHEREAS,programming will engage children and families in STEM learning through hands-on science and MakerSpace activities; and WHEREAS,staff recommends the acceptance of grant funding in the amount of $25,536 from the San Mateo County Human Services Agency to support Library and Parks and Recreation after-school homework programs; and WHEREAS,the foregoing grant funds will be used to amend this year’s operating budget of the Library Department. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council hereby accepts $25,536 in grant funding from the San Mateo County Human Services Agency and amends the Library Department’s Fiscal Year 2017-18 operating budget in order to reflect an increase of $25,536. ***** City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-664 Agenda Date:7/26/2017 Version:1 Item #:13. Report regarding a resolution authorizing the acceptance of $6,000 from the State of California,California Highway Patrol for the “Every 15 Minutes”Program and amending the Police Department’s Fiscal Year 2017- 18 Operating Budget.(Jeff Azzopardi, Police Chief) RECOMMENDATION It is recommended that the City Council adopt a resolution accepting a grant in the amount of $6,000 from the State of California,California Highway Patrol (CHP)for the “Every 15 Minutes”Program and amending the Police Department’s Fiscal Year (FY) 2017-18 Operating Budget. BACKGROUND/DISCUSSION The South San Francisco Police Department has implemented the “Every 15 Minutes”Program for approximately the last 12 years.As the Council may recall,every year the Police Department implements the “Every 15 Minutes”Program for the entire junior and senior student body at one of the City’s two public high schools,then the alternate school the following year to ensure every junior and senior high school student in the City of South San Francisco will experience the benefits of the program. In September of 2016,the South San Francisco Police Department submitted a grant application to the State of California,CHP for funding in an attempt to seek partial reimbursement costs associated with the “Every 15 Minutes”Program.The availability of the grants being offered by the State of California,CHP were limited and the maximum amount an agency could qualify for was $6,000.The grant application was reviewed and approved in November of 2016 by the CHP and the Police Department was awarded a grant for $6,000.This amount will be used as reimbursement for the filming and production costs associated with this year’s program. The goal of the grant is to assist law enforcement agencies with partial reimbursement of production costs associated with funding the “Every 15 Minutes” Program. Filming and production costs for the FY 2016-17 “Every 15 Minutes” Program consisted of the following: Kingston Media $8,750.00 (Complete video production & 50 DVD copies of short film @ El Camino Real) CV Creations $2,531.50 (Sound/audio/video equipment for the 2016 “Every 15 Minutes” Program Assembly @ City of South San Francisco Printed on 8/30/2017Page 1 of 2 powered by Legistar™ File #:17-664 Agenda Date:7/26/2017 Version:1 Item #:13. El Camino High School ___________________ Total $11,281.50 FUNDING The $6,000 grant will be used offset production costs and will be included in the Police Department’s FY2017- 18 Operating Budget. CONCLUSION It is recommended that the City Council adopt a resolution accepting a grant in the amount of $6,000 from the State of California,California Highway Patrol (CHP)for the “Every 15 Minutes”Program and amending the Police Department’s Fiscal Year 2017-18 Operating Budget. City of South San Francisco Printed on 8/30/2017Page 2 of 2 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-665 Agenda Date:7/26/2017 Version:1 Item #:13a. Resolution authorizing the acceptance of a $6,000 grant from the State of California,California Highway Patrol for the “Every 15 Minutes”Program and amending the Police Department’s Fiscal Year 2017-18 Operating Budget. WHEREAS,staff recommends the acceptance of a grant in the amount of $6,000 from the State of California, California Highway Patrol (CHP); and WHEREAS,the grant will be used to assist with reimbursement for the “Every 15 Minutes”program and the filming and production costs associated with the program; and WHEREAS,the foregoing grant funds will be used to amend the Fiscal Year 2017-18 Operating Budget of the Police Department. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council hereby accepts the $6,000 grant from the State of California,California Highway Patrol (CHP)and amends the Police Department’s Fiscal Year 2017-18 Operating Budget to reflect this increase of $6,000. ***** City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-694 Agenda Date:7/26/2017 Version:1 Item #:14. A report regarding adoption of an ordinance to establish the Antoinette Lane Underground Utility District,CIP project no. st1702. (Sam Bautista, Principal Engineer) RECOMMENDATION It is recommended that the City Council adopt an ordinance establishing an underground utility district along Antoinette Lane and waive further reading. BACKGROUND/DISCUSSION On July 12,2017,the City Council held a public hearing,then by a 5-0 vote introduced the following ordinance and waived further reading: AN ORDINANCE ESTABLISHING THE ANTOINETTE LANE UNDERGROUND UTILITY DISTRICT CONCLUSION Staff recommends that the City Council adopt the ordinance establishing the Antoinette Lane underground utility district and waive further reading. City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-695 Agenda Date:7/26/2017 Version:1 Item #:14a. Ordinance establishing the Antoinette Lane Underground Utility District, CIP Project st1702. WHEREAS,the California Public Utilities Commission (CPUC)has authorized electric and telecommunication utilities to convert overhead utility lines and facilities to underground pursuant to Electric Rule 20 and Telecommunication Rule 32; and WHEREAS,pursuant to certain criteria,CPUC rules allow participating cities and counties to adopt legislation establishing underground utility districts within which existing overhead electric distribution and telecommunication distribution and service facilities will be converted to underground facilities; and WHEREAS,the City of South San Francisco (“City’)Municipal Code Chapter 13.16 authorizes the City Council,after holding a public hearing,to designate districts within which all existing overhead poles,overhead wires and overhead equipment associated with the distribution of electric power,telecommunication services, and cable television, will be removed and replaced with underground wires and facilities; and WHEREAS,the City’s Fiscal Year 2017-18 Capital Improvement Program project st1704 calls for converting the overhead utility lines and facilities on Antoinette Lane to underground; and WHEREAS,to effect this undergrounding,the City desires to establish an Antoinette Lane Underground Utility District,extending approximately 1,300 feet from one block south to one block north of Chestnut Avenue,as more particularly described in Exhibit A attached hereto and incorporated herein by reference; and WHEREAS,upon finding that undergrounding the overhead utilities along Antoinette Lane is in the public interest,the City may establish an underground utility district containing all of the parcels within the district,as identified on the Exhibit A district boundary map,thereby allowing the City to expend a portion of its accumulated Rule 20A work credits to fund the utility conversion; and WHEREAS,the City has accumulated $6,578,321 of Rule 20A work credits as of March 31,2017,and may borrow at least $203,189 of future work credits,yielding $7,594,266 in work credits that may be used for qualified underground utility conversion projects pursuant to CPUC Rule 20A; and WHEREAS,the City has committed approximately $3,000,000 of its Rule 20A work credit balance to the previously established Spruce Avenue Underground Utility District,leaving an uncommitted balance of approximately $4,575,000; and WHEREAS,the estimated draw of Rule 20A work credits to complete the Antoinette Lane utility City of South San Francisco Printed on 8/30/2017Page 1 of 4 powered by Legistar™ File #:17-695 Agenda Date:7/26/2017 Version:1 Item #:14a. WHEREAS,the estimated draw of Rule 20A work credits to complete the Antoinette Lane utility undergrounding is $1,537,000, an amount that may be funded from the City’s available balance; and WHEREAS,the City and the affected utilities have consulted and agreed that each utility shall complete the engineering design of its respective portion of the Antoinette Lane Underground Utility District project; and WHEREAS,the City and the affected utilities have consulted and agreed that the City shall be designated as “lead agent”also known as “trenching agent,”responsible for preparing the trench profile and composite joint trench drawings,and managing trenching,installation of substructures,pavement restoration,and such other trench-related work; and WHEREAS,the City and the affected utilities have agreed to a work schedule which meets their respective capabilities and have further agreed to waive any administrative fees,costs,or special street restoration requirements for the purposes of this project; and WHEREAS,the City desires to expedite this project by all means feasible to minimize impact on construction of the adjacent Community Civic Center project and so requests that Pacific Gas &Electric (PG&E)substitute this project for the Spruce Avenue Underground Utility District placed in the PG&E queue in Fall 2016 such that utility design may begin in Fall 2017 and construction may begin in Spring 2018; and WHEREAS,the City notified all affected property owners within the proposed Antoinette Lane Underground Utility District and invited same to attend a public hearing to discuss formation of the proposed district; and WHEREAS,the City Council has received the staff report recommending that the area identified in Exhibit A should be designated as an underground utility district within which all existing overhead poles,overhead wires,and overhead equipment associated with the distribution of electric power,telecommunication services, and cable television should be removed and replaced with underground wires and facilities; and WHEREAS,a public hearing was duly held on July 12,2017 in the Council Chambers of the City of South San Francisco,at which time all interested persons were given an opportunity to be heard,and the City Council did consider any and all objections or protests that were raised by the owners of property within the proposed district, pertaining to designating this area an underground utility district; and WHEREAS,the City Council has determined that,pursuant to Section 13.16.020 of the South San Francisco Municipal Code,the public necessity,health,safety,and welfare requires the removal of overhead wires and overhead structures along Antoinette Lane, with underground re-installation of said wires and facilities; and WHEREAS,the City has consulted with the affected utilities and such utilities have agreed that the proposed underground conversion district,designated the Antoinette Lane Underground Utility District,as described in Exhibit A,adjoins or passes through a civic area or public recreation area or an area of unusual scenic interest to the general public, thereby qualifying as a Rule 20A District in accordance with CPUC rules; and City of South San Francisco Printed on 8/30/2017Page 2 of 4 powered by Legistar™ File #:17-695 Agenda Date:7/26/2017 Version:1 Item #:14a. WHEREAS,after establishing the Antoinette Lane Underground Utility District,the City will need to enter into standard agreements with PG&E and complete other standard forms and documentation,including,but not limited to,the “Agreement to Perform Tariff Scheduled Related Work,Rule 20A -General Conditions,”the “Agreement to Perform Tariff Schedule Related Work,Rule 20A -Electric Panel Service Conversion,”the “Letter of Streetlight Agreement,” and the “Rule 20A Wheelchair Access Consideration,”; and WHEREAS,upon the recommendation of staff,the City Council has determined that the proposed Antoinette Lane Underground Utility District is categorically exempt from environmental review pursuant to the California Environmental Quality Act. NOW, THEREFORE, the City Council of the City of South San Francisco does hereby ORDAIN as follows: SECTION 1.Findings The City Council of the City of South San Francisco (“City”)finds that the public interest requires the removal of all existing utility poles,(excepting those poles supporting streetlights and traffic signals),overhead utility wires,and associated overhead structures,and the installation of underground wires and facilities for supplying electric power,communication,or similar associated services within the areas as shown in Exhibit A,attached hereto,along Antoinette Lane,with such area being designated as the Antoinette Lane Underground Utility District. SECTION 2.Authorization to Execute Agreements Upon establishment of the District,the City Council authorizes the City Manager to complete,execute,and transmit on behalf of the City all agreements,acknowledgements,and forms necessarily to complete the Antoinette Lane Underground Utility District project,subject to approval as to form by the City Attorney and to provide PG&E direction to implement the City’s desires for an expedited schedule. SECTION 3.Severability If any provision of this Ordinance or the application thereof to any person or circumstance is held invalid or unconstitutional,the remainder of this Ordinance,including the application of such part or provision to other persons or circumstances,shall not be affected thereby and shall continue in full force and effect.To this end, provisions of this Ordinance are severable.The City Council of the City of South San Francisco hereby declares that it would have passed each section,subsection,subdivision,paragraph,sentence,clause,or phrase hereof irrespective of the fact that any one or more sections,subsections,subdivisions,paragraphs,sentences, clauses, or phrases be held unconstitutional, invalid, or unenforceable. SECTION 4.Publication and Effective Date Pursuant to the provisions of Government Code Section 36933,a summary of this Ordinance shall be prepared by the City Attorney.At least five (5)days prior to the Council meeting at which this Ordinance is scheduled to City of South San Francisco Printed on 8/30/2017Page 3 of 4 powered by Legistar™ File #:17-695 Agenda Date:7/26/2017 Version:1 Item #:14a. by the City Attorney.At least five (5)days prior to the Council meeting at which this Ordinance is scheduled to be adopted,the City Clerk shall (1)publish the Summary,and (2)post in the City Clerk’s Office a certified copy of this Ordinance.Within fifteen (15)days after the adoption of this Ordinance,the City Clerk shall (1) publish the summary,and (2)post in the City Clerk’s Office a certified copy of the full text of this Ordinance along with the names of those City Council members voting for and against this Ordinance or otherwise voting. This Ordinance shall become effective thirty (30) days from and after its adoption. ***** Introduced at a regular meeting of the City Council of the City of South San Francisco, held the 12th day of July, 2017. City of South San Francisco Printed on 8/30/2017Page 4 of 4 powered by Legistar™ 0933300 4 0 922 920 918 942 950 AN T O I N E T T E L N MISSION RD ANTOINETTE LN EL CAMINO REAL CH E S T N U T A V E A ST O A K A V E ANT O I N E T T E L N Exhibit A City of South San FranciscoProposed Antoinette LaneUtility Underground District 0 250 500125 Feet Legend Utility District Boundary Properties in Utility District City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-725 Agenda Date:7/26/2017 Version:1 Item #:15. Report regarding a resolution authorizing the acceptance of $29,000 in grant funding from the California State Library to support the Community Learning Center’s after-school program and amending the Library Department’s Fiscal Year 2017-18 Operating Budget. (Valerie Sommer, Library Director) RECOMMENDATION It is recommended that the City Council adopt a resolution authorizing the acceptance of $29,000 in grant funding from the California State Library to support the Community Learning Center’s (CLC) after-school program and amending the Library Department’s Fiscal Year (FY)2017-18 Operating Budget. BACKGROUND/DISCUSSION In February 2017,the Library Department applied for a federal Library Services and Technology Act (LSTA) grant administered by the California State Library.In July 2017,the Library Department was awarded $29,000 in federal LSTA funds to support the CLC’s community engagement project for immigrant families and families with limited literacy skills.The project will increase understanding of community issues and feelings of inclusion in families through celebration of diversity and community.This grant funding will be used by the CLC to plan and present interactive community building workshops to residents of South San Francisco. FUNDING Grant funds will be used to amend the Library Department’s current FY2017-18 Operating Budget.Receipt of these funds does not commit the City to ongoing funding. CONCLUSION Receipt of these funds will support the CLC’s after-school program for low-income students and their families. It is recommended that the City Council adopt a resolution authorizing acceptance of $29,000 in grant funding and amending the Library Department’s FY2017-18 Operating Budget. City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-726 Agenda Date:7/26/2017 Version:1 Item #:15a. Resolution authorizing the acceptance of $29,000 in grant funding from the California State Library to support the Community Learning Center’s after-school program and amending the Library Department’s Fiscal Year 2017-18 Operating Budget. WHEREAS,the City of South San Francisco (“City”)Library Department established the Community Learning Center (CLC) to assist adults and their families in reaching educational goals; and WHEREAS,in July 2017 the Library Department was awarded federal Library Services and Technology Act funding,administered by the California State Library,in the amount of $29,000 to support a community engagement project at the Community Learning Center; and WHEREAS,the project will focus on engaging immigrant families as well as low-literacy and low-income residents through community building workshops; and WHEREAS,staff recommends the acceptance of the grant funding in the amount of $29,000 to support CLC after-school programming; and WHEREAS, receipt of these grant funds does not commit the City to ongoing funding; and WHEREAS,the foregoing grant funds will be used to amend the Library Department’s Fiscal Year (FY)2017- 18 Operating Budget. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council hereby accepts $29,000 in grant funding from the California State Library and amends the Library Department’s FY2017-18 Operating Budget in order to reflect an increase of $29,000. ***** City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-727 Agenda Date:7/26/2017 Version:1 Item #:16. Report regarding a resolution authorizing the acceptance of $45,000 in grant funding from the Silicon Valley Community Foundation to support Project Read’s Financial Well-being program and amending the Library Department’s Fiscal Year 2017 - 18 operating budget. (Valerie Sommer, Library Director) RECOMMENDATION It is recommended that the City Council adopt a resolution authorizing the acceptance of $45,000 in grant funding from the Silicon Valley Community Foundation (SVCF)to support Project Read’s Financial Well-being program and amending the Library Department’s Fiscal Year (FY)2017-18 operating budget. BACKGROUND/DISCUSSION In April 2017,the Library Department applied for a grant from SVCF to support Project Read financial literacy services.In July 2017,Project Read was awarded grant funding in the amount of $45,000 to provide financial education and asset building strategies to adult literacy students and low-income immigrants living in South San Francisco and surrounding cities.In the past year,Project Read’s current Financial Well-being program presented over 100 people with financial education classes,provided 30 clients with one-on-one financial coaching,and opened ten asset-building accounts.Funding from SVCF allows Project Read to continue providing vital financial education services to residents of South San Francisco and its surrounding cities. FUNDING Grant funds will be used to amend the Library Department’s current FY2017-18 Operating Budget.Receipt of these funds does not commit the City to ongoing funding. CONCLUSION Receipt of these funds will support Project Read’s Financial Well-being program for adult literacy students and low-income immigrants.It is recommended that the City Council adopt resolution accepting $45,000 in grant funding and amending the Library Department’s FY17-18 operating budget. City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-729 Agenda Date:7/26/2017 Version:1 Item #:16a. Resolution authorizing the acceptance of $45,000 in grant funding from the Silicon Valley Community Foundation to support Project Read’s Financial Well-being program and amending the Library Department’s Fiscal Year 2017-18 operating budget. WHEREAS,the City of South San Francisco (“City”)Library Department established Project Read to assist adults and their families in reaching literacy goals; and WHEREAS,in July 2017,the Silicon Valley Community Foundation awarded a grant to the City in the amount of $45,000 to fund Project Read’s Financial Well-being programming; and WHEREAS,funds will be used to promote financial education and asset-building strategies in adult literacy students and low-income immigrant families; and WHEREAS,staff recommends the acceptance of grant funding in the amount of $45,000 from the Silicon Valley Community Foundation to support services by Project Read; and WHEREAS,the foregoing grant funds will be used to amend the FY 2017-18 operating budget of the Library Department. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council hereby accepts $45,000 in grant funding from the Silicon Valley Community Foundation and amends the Library Department’s Fiscal Year 2017-18 operating budget in order to reflect an increase of $45,000. ***** City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-782 Agenda Date:7/26/2017 Version:1 Item #:17. Closed Session: Public Employee Performance Evaluation (Pursuant to Government Code Section 54957) Title: City Manager City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-783 Agenda Date:7/26/2017 Version:1 Item #:18. Closed Session: Conference with Labor Negotiators (Pursuant to Government Code § 54957.6) Agency designated representatives: Pradeep Gupta, Mayor and Jason Rosenberg, City Attorney Unrepresented employee: City Manager City of South San Francisco Printed on 8/30/2017Page 1 of 1 powered by Legistar™