Policy Watch: Week of 7/10

City of Santa Clara

Raising minimum wage to reach $15 by 2019; Mayor recommends one week deferral

NOTE: Mayor Gillmor has released a memo recommending this item be continued one week to July 18 due to the length of the July 11 agenda.

Staff are recommending that the Council pass to print an amended ordinance establishing the City’s local minimum wage to reach $15 per hour by 2019 with the following provisions:

  • Increase to $13.00 on January 1,2018, and increase to $15.00 on January 1, 2019;
  • Add economic triggers that would provide an option to delay implementation of the minimum wage increases if a severe recession occurs during the ramp-up period;
  • Change the CPI index used for annual increases beginning January 1, 2020 to the regional CMSA CPI-W, with a maximum annual increase of five percent.

The City’s current minimum wage ordinance was approved in 2015 and was modeled after the cities of San Jose and Sunnyvale, two of the first cities in Santa Clara County to adopt local minimum wage ordinances. Santa Clara’s local minimum wage went into effect on January 1, 2016, with an initial hourly wage rate of $11.00 per hour, and was increased to $11.10 on January 1,2017.

Per Council’s direction, staff has implemented and completed community outreach and made significant efforts to obtain feedback from stakeholders. Based on feedback provided during community outreach, for ease of implementation and regional consistency, staff recommends an amendment to the City’s minimum wage ordinance. The proposed amendment is based on the regional model ordinance adopted by neighboring cities and includes the following provisions:

  • An increase to $15.00 per hour by 2019 starting with an increase to $13.00 on January 1,2018, and an increase to $15,00 on January 1, 2019.
  • For regional consistency (e.g. Cupertino, Milpitas, San Jose, State of California) add two economic triggers that would provide an option to delay implementation of the minimum wage increases during the ramp-up period if two triggers are met:
    • Decline in California’s seasonally adjusted nonfarm employment for either the three-month period ending in June or the six-month period ending in June, and
    • Decline in the state portion of the sales and use tax receipts measured by the 12-month period ending in June compared to the prior year.

If both of the above economic conditions are met during the ramp-up to $15.00, the City Manager would have the option to suspend the increase in the minimum wage for the upcoming year by September 1.

  • Change the CPI index used for annual increases from the U.S. All Cities CPI-W to the San Francisco-Oakland-San Jose Consolidated Metropolitan Statistical Area (CMSA) CPI-W to more accurately account for the cost of living adjustments in this area, with a maximum annual increase at of five percent.

To administer and enforce the current minimum wage ordinance citywide, the City of Santa Clara contracts with the City of San Jose’s Office of Equality Assurance for up to $20,000 per year. The enforcement model is complaint-driven with fees only paid when a complaint is filed, investigated, or resolved. Like other cities that have adopted minimum wage ordinances, the City of Santa Clara does not have the staff expertise or resources to handle enforcement of the ordinance. The cities of Sunnyvale, Mountain View, and other cities have similar contracts with the City of San Jose to handle these services. For FY 2016-17, approximately $1,800 of fees has been invoiced to the City of Santa Clara for the enforcement of its current minimum wage ordinance. This contract has been renewed for FY 2018-19 and will not change in cost to the City.

Where: Santa Clara City Council

When: July 11, 2017, 7:00pm

Link to item: http://sireweb.santaclaraca.gov/sirepub/agdocs.aspx?doctype=agenda&itemid=60290

Link to agenda: http://sireweb.santaclaraca.gov/sirepub/mtgviewer.aspx?meetid=1983&doctype=AGENDA


Reviewing recommendations of Affordable Housing Working Group and directing staff on preparation of Affordable Housing Impact Fee Ordinance

Staff are recommending that Council review and comment on the Ad Hoc Affordable Housing Working Group’s recommendations and proposed fee levels, provide feedback regarding the desired fee levels, and direct the City Manager to prepare a draft ordinance for the Council’s consideration.

The Ad Hoc Affordable Housing Working Group (Working Group), chaired by Vice Mayor Caserta, consisted of a range of interested parties and stakeholders including Councilmember Mahan and Councilmember Kolstad, Affordable Housing advocates, local residential and commercial developers, representatives from local workers unions, the League of Women Voters, the Building Industry Association and other interest groups and stakeholders (a full list of Working Group Members can be found in the Meeting Minutes from 5.31.2017 attached to this report). The working group met on four occasions from March-May, 2017 and discussed in detail preferred options for Affordable Housing requirements, inclusionary requirements for new residential development, in-lieu fees for residential development, impact fees for non-residential development and other considerations such as provisions for pipeline projects, a grace period, activities exempt from the fees and timing for fee payment. All working group meetings were open to the public and included time for public comments. The last meeting was held in the evening to better accommodate participation from the community.

At their final meeting on May 31, 2017, the Working Group reached a consensus for recommendations on a majority of the key components of the proposed Affordable Housing Impact Ordinance. In two instances (rental residential requirements and ordinance effective date), the Working Group decided to forward options or a range for the Council to consider as outlined below:

Rental Residential

  • For projects that proposed to meet the requirement through the provision of inclusionary units, a minimum of 10% – 15% of the units must be designated as affordable to TBD (e.g., moderate income/mix of low, etc. as determined by the City Council)
  • The Rental Residential impact fee is initially established as TBD (Working Group recommendation is a fee between $17-20 psf).


  • When a project has been deemed complete, it will be subject to the fee within the effective dates:
    • 0-6 Months: No Fee
    • 6-12 Months: 1/3 of total fee applicable
    • 12-18 Months: 2/3 of total fee applicable [OR] full fee applicable after 12 months (TBD by City Council).

Where: Santa Clara City Council

When: July 11, 2017, 7:00pm

Link to item: http://sireweb.santaclaraca.gov/sirepub/agdocs.aspx?doctype=agenda&itemid=60314

Link to agenda: http://sireweb.santaclaraca.gov/sirepub/mtgviewer.aspx?meetid=1983&doctype=AGENDA


Closed session discussion of City Manager employment

Council will be holding a closed session meeting regarding employment of the City Manager.

Where: Santa Clara City Council

When: July 11, 2017, 6:00pm

Link to item: http://sireweb.santaclaraca.gov/sirepub/agdocs.aspx?doctype=agenda&itemid=60305

Link to agenda: http://sireweb.santaclaraca.gov/sirepub/mtgviewer.aspx?meetid=1983&doctype=AGENDA



City of Gilroy

Revising Economic Incentive Policy to make more large development projects eligible & avoid prevailing wage requirement

Staff are recommending that Council consider a proposed economic incentive payment plan policy for large scale economic development projects. Adopting an economic incentive policy allows the City of Gilroy to be competitive with other cities in attracting large development that would bring jobs, tax and other revenue to the City of Gilroy.

In 1999, the City Council first adopted an Economic Incentive Policy to promote economic development activity throughout Gilroy. There have been numerous revisions to this policy, with the latest in 2006. This current policy allows a waiver of impact fees for development projects with significant sales tax, transit occupancy tax and jobs that met the salary threshold in the policy. For the waived fees, the City uses General Fund (taxpayers) monies as a credit to the developer impact fees to make the impact funds ‘whole’.

Since 2002, the State of California stipulates that use of General Fund money for any portion of a development, whether on site or off, must pay the State prevailing wages. Typically, the prevailing wage requirement increases project costs by roughly 30%. Projects that qualify for the 2006 Economic Incentive policy are typically very large multi-million dollar projects, and prevailing wage would add significantly to the project cost, thus no company has been interested in this policy for several years. The current policy includes a Development Fee Deferral program. In addition to the Economic Incentive Policy, Section 21.127 of the Gilroy City Code (Subdivision and Land Development Chapter) addresses timing of payment of traffic, library, and public facilities impact fees. For nonresidential projects, these impact fees are due “at the earlier of the time specified by an agreement with the city or prior to issuance of a building permit.” As written, the current Economic Incentive Policy is limited only to industrial park developments where full street improvements exist.

Staff are proposing to revise the Economic Incentive Policy in order to apply to more development projects with the potential to substantially support the local economy – by providing at least 100 new jobs, or at least 75 new rooms in the case of a hotel. Eligible projects would consist of new construction, as the program is not intended for tenant improvement projects or existing businesses relocating within the city. Additionally, the City Attorney has clarified that if fees are deferred rather than waived, prevailing wage rates would not be required.

The intent of the payment plan is to provide flexibility for the developer, while not creating any burden to Gilroy taxpayers or negatively affecting the city’s budget. As such, full payment of development impact fees, with interest, would be anticipated in three equivalent increments. The first 1/3 payment would be due at Certificate of Occupancy (CofO) issuance. A second 1/3 payment would be due no later than one year after CofO issuance, and the final 1/3 payment would be due no later than two years after CofO issuance. Interest calculations would be based on the LAIF rates, as established by the California State Treasurer’s Office.

If Council decides to consider this new policy, staff are requesting direction in developing program details and would return to Council with a draft resolution to adopt the Economic Incentive Payment Plan Policy.

Where: Gilroy City Council

When: July 10, 2017, 6:00pm

Link to item: http://www.cityofgilroy.org/AgendaCenter/ViewFile/Item/2607?fileID=6383

Link to agenda: http://www.cityofgilroy.org/AgendaCenter/ViewFile/Item/2608?fileID=6384



San Jose Evergreen Community College District

Issuing formal letter to Trustee Mann regarding Brown Act and other ethical violations

District staff and members of the Ethics Committee are recommending that the Board issue Trustee Mann a formal letter notifying him that:

  • continued violations of BP 2715, as outlined in the letter provided to him by the ethics committee, will not be tolerated;
  • continued violations may result in further sanctions as authorized by BP 2715, including but not limited to formal censure or other action deemed necessary, which may include removal from his position as President of the Board;

In addition, the Ethics Committee is recommending that the Board members and executive staff not read or respond to text and/or email communications from Trustee Mann, unless he is speaking on behalf of and with the authorization of the Board.

This item is placed on the agenda at the direction of Vice President of the Board, Mayra Cruz, pursuant to BP 2715. BP 2715 provides, in part, that the Board President (or Vice President if the concerning conduct relates to the President) is required to convene an ad-hoc ethics committee when concerns of possible ethical violations are brought to his/her attention. Trustee Cruz, through concerns brought to her attention by fellow trustees and executive staff, was placed on notice that Trustee Mann’s text and email communications, and use of social media could be violating the Brown Act, confidentiality of closed session, and Standard IV of the ACCJC accreditation standards–all violations of BP 2715. As required, she convened an ad-hoc ethics committee, comprised of herself and Trustee Nasol, who conducted the investigation required by BP 2715. This investigation uncovered multiple Brown Act violations and other BP 2715 violations. Trustees Cruz and Nasol provided Trustee Mann with a letter, communicating their deep respect for him as a trustee, detailing their concerns, and requesting to meet with him to discuss and resolve these issues before the ethics committee made its required report to the Board. Trustee Mann responded by communicating his refusal to meet.

Prior to Board considering this action, Trustee Cruz shall provide a report regarding the ethics committee investigation and findings, as required by BP 2715.

Where: San Jose-Evergreen Community College District Board of Trustees

When: July 11, 2017, 4:30pm

Link to item: http://www.boarddocs.com/ca/sjeccd/Board.nsf/goto?open&id=ANZU5W7A7269

Link to agenda: http://www.boarddocs.com/ca/sjeccd/Board.nsf/Public#tab-meetings


Cupertino Unified School District

Approving Co-Interim Superintendent Employment Agreements with Chris Jew and Stacy McAfee

District staff are recommending that the Board approve the Interim Superintendent Employment Agreements for Chris Jew and Stacy McAfee.

The Board of Education at its April 19, 2017 Special Board Meeting, took action to appoint Chris Jew, Chief Business Officer, and Stacy McAfee, Associate Superintendent Human Resources, to co-manage the District through June 30, 2017. This arrangement was to allow the Board to focus its efforts on the search for a new Superintendent. As the Board has established its process and identified a proposed timeline to hire a new Superintendent, the Board understands the importance of making sure the operations of the District are being managed until such time. As of July 1, 2017 the Board of Education desires to continue having Chris Jew and Stacy McAfee manage the District as co-interim superintendents and continue serving in their regular capacities as Chief Business Officer and Associate Superintendent Human Resources until the new Superintendent has been hired.

The Board desires to enter into a temporary employment agreement with both Chris Jew and Stacy McAfee to secure their additional services from July 1, 2017 to August 31, 2017. As compensation, the agreement will be indexed to the per diem rate associated with Step A on the current 2016-2017 Superintendent Salary Schedule. Both Chris Jew and Stacy McAfee will share evenly the per diem rate until a new Superintendent commences employment, whichever is sooner, unless otherwise agreed by the partners of this Agreement. In the event a Superintendent does not commence work by September 1, 2017, the Interim Superintendent and Board may review all provisions of this agreement in anticipation of extending this term.

The cost for each agreement is $10,571.67 per month, plus statutory benefit costs.

Where: Cupertino Union School District Board of Education

When: July 11, 2017, 6:00pm

Link to agenda: https://drive.google.com/file/d/0B4gKJD9AIgr6N21Fa21aZktXRTA/view


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