|| Santa Clara County ||
VTA: Approve Exclusive Negotiation Agreement with Lincoln Property Group for redevelopment of Cerone site, incl. hotel, office & adv. manufacturing
Issue summary: The committee will consider approving a staff recommendation allowing the General Manager to enter into exclusive negotiations with LPC West to redevelop a VTA-owned site at VTA Cerone Maintenance Yard.
VTA received proposals from Trammell Crow Company (TCC), Lincoln Property Company (LPC West), TMG Partners (TMG). TCC’s proposal was rejected as non-responsive to the RFP. The other two proposals were found to be in compliance of the RFP requirements.
A review panel was convened consisting of three VTA Real Estate staff members, one VTA Operations staff member, and a representative from the City of San Jose’s Office of Economic Development. The panel determined that both the LPC West and TMG proposals have the potential for successful negotiation of a Lease Option Agreement that accomplishes TOD Policy goals. The panel’s consensus finding is that the LPC West proposal is overall superior for the following reasons:
Greater Proceeds to VTA. The LPC West proposal is projected to generate greater proceeds to VTA over the term of the ground lease than TMG’s proposal.
Maximizes Development. The LPC West proposal identifies two potential development programs: one that maximizes density on the site through a mix of uses including office, hotel, advanced manufacturing, and community spaces and totals approximately 2.5 million square feet; and a more conservative program that increases advanced manufacturing uses and totals approximately 1.08 million square feet.
By comparison, the TMG proposal includes three development options: Option A which focuses on low-density advanced manufacturing uses and totals approximately 575,000 square feet; Option B which includes research & redevelopment space and totals approximately 898,000 square feet; and Option C which incorporates office uses and totals approximately 1.4 million square feet.
The North San Jose submarket is rapidly evolving and the LPC West proposal provides a more flexible approach that provides for more development to accommodate potential future demand.
Job Creation. The LPC West proposal has the potential to create between 7,031 and 9,114 jobs, which supports the City’s job creation goals for the North San José Employment Land Area as stated in the General Plan. By comparison, the TMG proposal has the potential to create between 1,437 and 5,384 jobs.
Transit Center and Public Benefits. The LPC West proposal includes the construction of a transit center along the Zanker Road frontage designed to serve the project and community. The proposed concept also includes 8.5 acres of public park space comprised of a 3-acre public park with flexible commercial and retail spaces, a bike path connection through the site to the Coyote Creek Regional Path, and a centralized pavilion designed to host both community and tenant events. By comparison, the TMG proposal includes the creation of a bus stop along the Zanker Road frontage as required under the RFP, and includes an active main entry flanked by restaurants and outdoor gathering spaces usable by both tenants and the public.
Participation in Revenues. The LPC West proposal includes a percentage rent structure and LPC West has expressed willingness to negotiate additional capital event or other incentive-based participation. This aligns the interests of both VTA and LPC West to optimize the development and potential subsequent redevelopment of the property over the lease term. By comparison, TMG offered a one-time cash payment for any future development program square footage that is in excess of the initial entitlements. Additionally, TMG has offered a one-time capital event participation based on the development program use and gross sales price.
Budget for Transit Operations Relocation. Both the LPC West and TMG proposals call for transit operations relocations, but LPC West provides a larger budget for VTA’s relocation needs than TMG’s proposal. The higher budget is consistent with the projected cost anticipated by VTA’s architect/designer. The lower cost estimate by TMG presents a greater potential risk to VTA since increasing the budget to match VTA’s expenditures would be expected to result in an offsetting reduction in the upfront ground lease payment that would be paid to VTA.
The evaluation panel identified recommendations for how either the LPC West or TMG proposals could be improved that could serve as a basis for VTA’s negotiation objectives during the ENA period.
|| City of San Jose ||
Draft framework for nonprofit affordable housing developers under Measure E transfer tax
Issue summary: Council will discuss a draft framework for handling property transfers to nonprofits under the proposed real property transfer tax on the March 3, 2020 ballot. If Measure E passes, council will direct the Administration to return to with a report on how it would implement the framework approved by the council.
Staff recommends focusing on property transferred to nonprofits to construct, preserve, or expand affordability in housing that is affordable to individuals and families earning 80 percent or less of the area median income. An outright donation or gift of real property to a nonprofit (or to a for-profit for that matter) would not be subject to the proposed real property transfer tax where the value of the consideration of the property donated or gifted is zero. Further, Measure E, if approved by the voters, exempts all transfers of real property where the value of the consideration of the property transferred is less than $2 million.
The Housing Department analyzed the eleven affordable housing developments selected for funding in the City’s recent $100 million Notice of Funding Availability to determine estimated transfer tax costs scenarios had these transfers been subject to Measure E. All of these properties sites were acquired to develop and construct affordable housing and would not be impacted by Measure E. Developers include both nonprofit and for-profit developers. The total estimated tax amount is $596,792.
Staff recommends that when a property is transferred to a nonprofit for the purpose of constructing affordable housing, the nonprofit would be eligible for predevelopment assistance from the San Jose Housing Department, which could include covering the amount of the transfer tax among other predevelopment costs. This would require the nonprofit to enter into a predevelopment agreement with the City, which would include how many units are intended to be built, the depth of affordability restrictions, and the term of affordability. This option would apply only to sites where 100 percent of the units would have minimum affordability for those at or below 80 percent of AMI for at least 55 years.
To encourage nonprofits to acquire developments with expiring affordability restrictions and preserve the existing affordability restrictions, staff recommends that nonprofits be eligible for assistance from the Housing Department equal to the amount of the real property transfer tax if the property is being transferred for the purpose of preserving affordability. Staff recommend the same assistance for nonprofits that acquire existing apartment complexes and convert them into affordable housing.
Update on Wage Theft Prevention Policy
Issue summary: Staff recommend council provide direction to continue developing updates to the Wage Theft Prevention Policy and return to council in spring 2020 with recommendations, policy options, and resource requirements. This item was deferred from February 4, 2020.
The current policy applies to all solicitations conducted by the Finance Department’s Purchasing Division, which has delegated authority to procure supplies, materials, equipment, services, and information technology for the City. Staff’s research indicates there are significant underlying issues with the measurability, verification, and enforcement of the current policy.
According to a June 2018 report by Good Jobs First, many Fortune 500 companies have experienced more than one wage theft violation. Staff compared the list of the City’s vendors procured through the City’s Purchasing Division against the 491 parent companies deemed by Good Jobs First to have $1 million or more in wage theft penalties. This analysis found 91 matches (19%) across dozens of industries, including technology software companies, telecommunications, energy, healthcare, insurance, retail, food service, courier, airlines, rental cars, hospitality, facility management and maintenance services and operations, amongst others. None of the City’s vendors disclosed previous wage theft violations or existing final judgments.
A major policy recommendation of the Wage Theft Memo prioritized by council was the proposal to remove the existing Wage Theft Prevention Policy’s exclusion of City public works construction contracts. Public works contracts were explicitly exempted as there is already a proactive and rigorous system in place to ensure workers are paid a prevailing wage on existing public works contracts through the department’s Office of Equality Assurance (OEA). However, the program does not include a review of a contractor’s history of wage compliance performance within other jurisdictions. Expansion of the City’s wage theft policy to include Public Works projects would allow for wage compliance within other jurisdictions to be considered.
To simultaneously ensure Public Works projects are included in the wage theft policy and that they can continue to move forward without significant delays during the procurement process, the definition of wage theft should be measurable, verifiable, and enforceable. The current Policy’s definition, while well-intended, is not measurable or verifiable and therefore extremely difficult to enforce.
Recommended changes:
- Measurable: wage theft should be defined as an unpaid final judgment from the State of California’s Division of Labor Standards Enforcement. Unpaid final judgments should not be time-limited, therefore the existing five-year threshold for unpaid final judgments should be removed.
- Verifiable: the City must be able to receive ongoing access to DLSE’s database. Staff is exploring legislative solutions at the state level to address access to information between the State and the City, as well as between DLSE and other State agencies, such as the State Contractor’s Licensing Board for action against licensees.
- Enforceable: With a measurable and verifiable definition of wage theft, staff can enforce policy by excluding parties from doing business with the City upon verification that they do not meet the City’s clear wage theft standards. A more robust enforcement paradigm should also include better coordination with the State. The State Labor Commissioner (who oversees DLSE) holds extraordinary police powers to prevent wage theft and ensure the payment of final judgments. Council should also consider if it wishes to shift towards a more proactive enforcement model that, at a minimum, verifies vendor self-disclosure forms in a randomized manner.
- Private Construction – staff reviewed the proposed “Responsible Construction Ordinance,” which would apply to private construction projects, and specifically to any applicant for a building permit for any construction, alteration, and/or demolition work of greater than 5,000 square feet of floor area within the City. Additionally, permit applicants would be responsible for requiring every contractor or subcontractor with a contract-value of $50,000 or more to provide a wage theft disclosure form. Staff raise concerns with administrative, policy and legal issues related to implementation lens requiring further time and coordination with PBCE, the City Attorney’s Office, DPW, and stakeholders from South Bay Labor Council, Working Partnerships USA, Santa Clara and San Benito County Building Trades Council, Santa Clara County MEPs, and the Santa Clara County Wage Theft Coalition to address issues and changes before coming back to Council with recommendations.
Apply to provide electric distribution to Downtown West Mixed-Use Plan area and Diridon Station area
Issue summary: Staff recommend council direct the City Manager to submit an application for Wholesale Transmission Service Interconnection to Pacific Gas and Electric for the City of San José to provide electric distribution service to the Downtown West Mixed-Use Plan area and potentially the broader Diridon Station Area. No staff memo was available.
Establish San Jose Education Policy
Issue summary: Staff recommend council approve establishing the San Jose Education Initiative as Council Policy 0-30; change the name of the Library and Early Education Commission to the Library and Education Commission; and change the subject matter expertise of the Early Education-specific seats to Education subject matter expertise.
The approval of the Education Policy will guide the ongoing implementation of the Education and Digital Literacy strategy, which was approved by City Council in May 2018. A fundamental aspect of the EDL is the development and adherence to quality standards for all City-funded, operated, or endorsed programs that are educational or focus on skill development for school-aged children and youth.
To reflect the role of the Library and Early Education Commission in advising the City Council on the Education Initiative, staff recommends changing the name to the Library and Education Commission. Also, expanding the subject matter background for the four Early Education seats to a background in Education is intended to allow a broader cross section of the education community to be appointed to the commission.
Approve spending allocations for Measure E Property Transfer Tax revenues – DROP
Staff recommended council approve revisions to City Council Policy 1-18, Operating Budget and Capital Improvement Program Policy, to set forth a spending plan related to the revenues from a new real property transfer tax if approved by a majority of voters on March 3, 2020. This item was dropped from the agenda.
Appointing 2 tech industry applicants to Council Appointment Advisory Commission
Issue summary: Staff recommend council approve the appointments of Arthur Kulakow and Lee Space to the Council Appointment Advisory Commission for terms ending December 31, 2023.
Lee Space is a director of business development for Palo Alto Networks. Arthur Kulakow is an engineer for Automation Anywhere.
Approving ending Household Hazardous Waste program and granting Recology rate increase
Issue summary: Staff recommends council approve ending the curbside Household Hazardous Waste program and approve Recology’s request for a rate increase of an additional $2.24 per month for customers in single-family homes and a rate increase of 3.93% for all other categories of Service Recipients to cover the increased cost of mixed recycling processing as a result of disruption and volatility of overseas recycling commodity markets.
The HHW program entails administering door-to-door collection, transportation, and disposal of HHW from single-family and multi-family residential properties. The program was funded with a monthly fee of $0.56 per single-family residence and $0.42 per multi-family residence unit. In late 2018, Recology/WM stopped providing curbside HHW service, although ratepayers continued to be charged for the service. This action would remove the fee and credit residents back fees billed since January 1, 2019.
Without the curbside HHW program, residents can safely dispose of HHW through the Santa Clara County Household Hazardous Waste Program.
Under the Franchise Agreement, Recology is the exclusive hauler of garbage, organic, and recyclable materials from all commercial and residential properties in the City. Due to the increased processing costs of recyclables, Recology requested a Special Maximum Rate Adjustment on October 15, 2019. Local agencies throughout California have faced similar waste management challenges due to China’s National Sword policy, and their responses have varied. Some jurisdictions have rejected hauler proposals to shift the burden of costs or market risks. For example, in mid-2018, IMS Recycling, Inc. and Allen Company approached the City of San Diego about transitioning to a fee-based pricing model through the end of their franchise agreement. While the City agreed to suspend the franchisees’ per-ton, flat-rate payment to the City, the City refused to pay the franchisees for recycling services. Other jurisdictions, however, have agreed to alter payment structures with their franchise haulers and processors. These increased costs are generally passed on to residential customers.
Approve $22M in consultant contracts for Vallco Town Center SB 35 project
Issue summary: Staff recommend council award a three-year contract to 4LEAF, Inc. for construction and public works inspection of the Vallco SB 35 project in the amount of $7,407,710. In addition, council would award a three-year contract of $1,150,000 to CSG Consultants, Inc. and another contract of $13,500,000 to Independent Code Consulting, Inc. for plan review services for the project.
The Vallco SB35 project has a magnitude and scale that is beyond the City’s traditional in-house plan review and inspection services. The building permit applications will be divided into a number of smaller packages, some design‐build and some through traditional application packages. The construction inspection services include ensuring that all work complies with the approved construction documents. Plan review services includes the review of Architectural, Structural, and Civil drawings submitted by the applicant for compliance with the approved project and provisions of all State and local laws and regulations which include, Fire and Life‐Safety, Accessibility, Structural, Plumbing, Mechanical, Electrical, and Energy codes associated with all proposed on-site and off-site construction associated with the Vallco SB35 project.
|| City of Sunnyvale ||
Approve issuing single-source RFP to BCWS for solid waste & recycling collection
Issue summary: Staff recommend council approve issuing an RFP package to Bay Counties Waste Services for solid waste and recycling collection services.
BCWS currently holds an exclusive franchise for the city’s solid waste and recycling services, which expires on June 30, 2021. Council previously directed staff to develop a “single-source” RFP package for solid waste and recycling collection services for release to BCWS. The RFP is simpler than would be typical for a competitive process, with a requested scope of services, submittal requirements, and process and schedule details. With a single-source process, there is no need to request information regarding experience or qualifications.
BCWS will submit the written proposal, draft agreement with any comments, and pricing information on April 3, 2020. Staff will then review the proposal and anticipates conducting three negotiation sessions with BCWS. Staff will return to Council to recommend award by ordinance of the new agreement and a new franchise if negotiations are successful, or pursue a competitive process if negotiations are unsuccessful.
Strategic planning session; incl. focus on Moffett Park, El Camino Real, business license tax, and other Council priorities
Issue summary: City Council will hold a daylong strategic planning session, including budget& fiscal report, staffing review, and discussion on Council priorities.
Strategic Discussion Topics include:
- Moffett Park
- Service Level Set Aside
- El Camino Real Corridor Specific Plan
- Business License Tax
|| Water District ||
Closed session – Hearing Stakeholders concerning CEO recruitment
Issue summary: In November 2019, current Santa Clara Valley Water District (Valley Water) Chief Executive Officer, Norma Camacho, announced her retirement, effective July 11, 2020.
The Valley Water Board of Directors has launched a formal executive search for the next Chief Executive Officer/General Manager. To manage the search process, the board has retained Avery and Associates, an Executive Search and Labor Relations consulting firm.
The Board welcome input on the selection process. The Board will hear comments on this subject at 11:00 a.m.
Closed session – Appointing Chief Executive Officer
Issue summary: Closed session for Public employee appointment of Chief Executive Officer.
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