Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
CC_2022_04_26_AgendaPacket
CITY OF ATASCADERO CITY COUNCIL AGENDA HYBRID MEETING INFORMATION: In accordance with City Council Resolution No. 2022-006 and the requirements of AB 361, the City Council Meeting will be available via teleconference for those who wish to participate remotely. The City Council meeting will also be held in the City Council Chambers and in-person attendance will be available at that location. HOW TO OBSERVE THE MEETING REMOTELY: To participate remotely, residents can livestream the meeting on Zoom, SLO-SPAN.org, on Spectrum cable Channel 20 in Atascadero, and listen live on KPRL Radio 1230AM and 99.3FM. The video recording of the meeting will repeat daily on Channel 20 at 1:00 am, 9:00 am, and 6:00 pm and will be available through the City’s website and on the City’s YouTube Channel. To participate remotely using the Zoom platform please visit https://us02web.zoom.us/webinar/register/WN_ZwJ7a031S3KXauEym9ehaA. HOW TO SUBMIT PUBLIC COMMENT: Individuals who wish to provide public comment in-person may attend the meeting in the City Council Chambers. Individuals who wish to provide public comment remotely may participate in live public comment through the Zoom platform using the link above. If you wish to comment but not via a live platform, please email public comments to cityclerk@atascadero.org. Such email comments must identify the Agenda Item Number in the subject line of the email. The comments will be forwarded to the City Council and made a part of the administrative record. To ensure distribution to the City Council prior to consideration of the agenda, the public is encouraged to submit comments no later than 12:00 p.m. the day of the meeting. Those comments, as well as any comments received after that time, but before the close of the item, will be distributed to the City Council, posted on the City’s website, and will be made part of the official public record of the meeting. Please note, email comments will not be read into the record. AMERICAN DISABILITY ACT ACCOMMODATIONS: Any member of the public who needs accommodations should contact the City Clerk’s Office at cityclerk@atascadero.org or by calling 805-470-3400 at least 48 hours prior to the meeting or time when services are needed. The City will use their best efforts to provide reasonable accommodations to afford as much accessibility as possible while also maintaining public safety in accordance with the City procedure for resolving reasonable accommodation requests. City Council agendas and minutes may be viewed on the City's website: www.atascadero.org. Copies of the staff reports or other documentation relating to each item of business referred to on the Agenda are on file in the office of the City Clerk and are available for public inspection on our website, www.atascadero.org. Contracts, Resolutions and Ordinances will be allocated a number once they are approved by the City Council. The Minutes of this meeting will reflect these numbers. All documents submitted by the public during Council meetings that are made a part of the record or referred to in their statement will be noted in the Minutes and available for review by contacting the City Clerk's office. All documents will be available for public inspection by appointment during City Hall business hours. Page 1 of 114 CITY OF ATASCADERO CITY COUNCIL AGENDA Tuesday, April 26, 2022 City Hall Council Chambers, 4th floor 6500 Palma Avenue, Atascadero, California COUNCIL CLOSED SESSION – CALL TO ORDER: 5:00 P.M. 1. ROLL CALL 2. CLOSED SESSION -- PUBLIC COMMENT 3. COUNCIL RECESS INTO CLOSED SESSION 4. CLOSED SESSION a. Conference with Legal – Anticipated Litigation Significant exposure to litigation pursuant to Government Code Section 54956.9(d)(2): 1 potential case – California Voting Rights Act b. Conference with Legal Counsel – Existing Litigation Government Code Sec. 54956.9(d)(1) Name of Case: Newton v. City of Atascadero San Luis Obispo Superior Court Case No. 21CVP-0168 5. CLOSED SESSION – ADJOURNMENT 6. COUNCIL RETURNS REGULAR SESSION – CALL TO ORDER: 6:00 P.M. PLEDGE OF ALLEGIANCE: Council Member Dariz City Council Closed Session: 5:00 P.M. City Council Regular Session: 6:00 P.M. Page 2 of 114 ROLL CALL: Mayor Moreno Mayor Pro Tem Newsom Council Member Bourbeau Council Member Dariz Council Member Funk APPROVAL OF AGENDA: Roll Call Recommendation: Council: 1. Approve this agenda; and 2. Waive the reading in full of all ordinances appearing on this agenda, and the titles of the ordinances will be read aloud by the City Clerk at the first reading, after the motion and before the City Council votes. CLOSED SESSION – REPORT (IF ANY) Announcement(s) of any reportable action(s) taken in Closed Session that occur(s) after the adjournment of Regular Session will be made at the beginning of the next Regular City Council meeting as Closed Session is not recorded or videotaped. PRESENTATIONS: 1. Proclamation declaring April as Sexual Assault Action Month A. CONSENT CALENDAR: (All items on the consent calendar are considered to be routine and non-controversial by City staff and will be approved by one motion if no member of the Council or public wishes to comment or ask questions. If comment or discussion is desired by anyone, the item will be removed from the Consent Calendar and will be considered in the listed sequence with an opportunity for any member of the public to address the Council concerning the item before action is taken.) 1. City Council Draft Action Minutes – April 12, 2022 ▪ Recommendation: Council approve the April 12, 2022 Draft City Council Regular Meeting Minutes and the Draft Special Closed Session Meeting Minutes. [City Clerk] 2. March 2022 Accounts Payable and Payroll ▪ Fiscal Impact: $4,666,915.54 ▪ Recommendation: Council approve certified City accounts payable, payroll and payroll vendor checks for March 2022. [Administrative Services] 3. Radio Repeater Replacement ▪ Fiscal Impact: $332,500.00 ▪ Recommendation: 1. Authorize the City Manager to execute a contract with Applied Technology Group, Inc. in the amount of $287,529 for the purchase and installation of radio repeater equipment and related hardware for the City’s radio communication system. 2. Authorize the Director of Administrative Services to appropriate up to $12,500 in Dial-a-Ride funds for the local match. [Information Technology] Page 3 of 114 4. Revision (or Update) to Deed Restriction Requirements on Affordable Housing Moderate-Income Unit Resale ▪ Fiscal Impact: No immediate fiscal impact; however, this change in policy could reduce the total number of moderate-income units available within the City’s Affordable Housing Program. ▪ Recommendation: Council adopt Draft Resolution giving the City Manager or designee the authority to waive the requirement to record an affordable housing deed restriction on moderate-income units upon sale to a qualified buyer when the sales price and appraised value are within 2% or below the maximum applicable moderate-income sales price, consistent with the current San Luis Obispo County’s Affordable Housing Standard. [Administrative Services] UPDATES FROM THE CITY MANAGER: (The City Manager will give an oral report on any current issues of concern to the City Council.) COMMUNITY FORUM: (This portion of the meeting is reserved for persons wanting to address the Council on any matter not on this agenda and over which the Council has jurisdiction. Speakers are limited to three minutes. Please state your name for the record before making your presentation. Comments made during Community Forum will not be a subject of discussion. A maximum of 30 minutes will be allowed for Community Forum, unless changed by the Council. Comments will be allowed for the entire 30-minute period so if the final speaker has finished before the 30 minute period has ended and a member of the public wishes to make a comment after the Council has commenced another item, the member should alert the Clerk within the 30 minute period of their desire to make a comment and the Council will take up that comment upon completion of the item which was commenced. Any members of the public who have questions or need information may contact the City Clerk’s Office, between the hours of 8:30 a.m. and 5:00 p.m. at (805) 470-3400, or cityclerk@atascadero.org.) B. PUBLIC HEARINGS: 1. Centennial Plaza Planned Development - Zone Change (ZCH) 22-0022 - 5901 East Mall ▪ Fiscal Impact: None. ▪ Recommendation: Council introduce for first reading, by title only, a Draft Ordinance, amending the Atascadero Municipal Code, Title 9 Planning & Zoning, Section 9-3, Article 26, adding Section 9-3.682 to add a new Planned Development Overlay Zone 37 for the five vacant lots surrounding Centennial Plaza and including Centennial Plaza (lots 12-17), based on findings and subject to the future approval of a Master Plan of Development. [Community Development] C. MANAGEMENT REPORTS: 1. Fiscal Update ▪ Fiscal Impact: None. ▪ Recommendations: Council receive and file fiscal update. [Administrative Services] Page 4 of 114 2. AB 481 – Military Equipment Policy ▪ Fiscal Impact: None. ▪ Recommendations: Council review and receive the proposed 2022-2023 Military Equipment Policy in accordance with AB 481. [Police Department] D. COUNCIL ANNOUNCEMENTS AND COMMITTEE REPORTS: (On their own initiative, Council Members may make a brief announcement or a brief report on their own activities. The following represent standing committees. Informative status reports will be given, as felt necessary): Mayor Moreno 1. City Selection Committee 2. County Mayors Round Table 3. Regional Economic Action Coalition (REACH) 4. SLO Council of Governments (SLOCOG) 5. SLO Regional Transit Authority (RTA) Mayor Pro Tem Newsom 1. City / Schools Committee 2. Design Review Committee 3. League of California Cities – Council Liaison 4. Visit SLO CAL Advisory Committee Council Member Bourbeau 1. City of Atascadero Finance Committee 2. City / Schools Committee 3. Integrated Waste Management Authority (IWMA) 4. SLO County Water Resources Advisory Committee (WRAC) Council Member Dariz 1. Air Pollution Control District 2. California Joint Powers Insurance Authority (CJPIA) Board 3. City of Atascadero Finance Committee Council Member Funk 1. Atascadero Basin Ground Water Sustainability Agency (GSA) 2. Design Review Committee 3. Homeless Services Oversight Council E. INDIVIDUAL DETERMINATION AND / OR ACTION: (Council Members may ask a question for clarification, make a referral to staff or take action to have staff place a matter of business on a future agenda. The Council may take action on items listed on the Agenda.) 1. City Council a) Council Member Funk will present information regarding the work of the HSOC Steering Committee developing the Countywide Strategic Plan to Address Homelessness. Council will discuss, receive public comment and provide input/feedback to Councilmember Funk on the San Luis Obispo County Strategic Plan to Address Homelessness for her to share with the Steering Committee. Page 5 of 114 2. City Clerk 3. City Treasurer 4. City Attorney 5. City Manager ADJOURN Please note: Should anyone challenge any proposed development entitlement listed on this Agenda in court, that person may be limited to raising those issues addressed at the public hearing described in this notice, or in written correspondence delivered to the City Council at or prior to this public hearing. Correspondence submitted at this public hearing will be distributed to the Council and available for review in the City Clerk's office. Page 6 of 114 ITEM NUMBER: A-1 DATE: 04/26/22 Atascadero City Council April 12, 2022 Page 1 of 5 CITY OF ATASCADERO CITY COUNCIL DRAFT MINUTES Tuesday, April 12, 2022 City Hall Council Chambers, 4th floor 6500 Palma Avenue, Atascadero, California REGULAR SESSION – CALL TO ORDER: 6:00 P.M. Mayor Moreno called the meeting to order at 6:02 p.m. and Council Member Bourbeau led the Pledge of Allegiance. ROLL CALL: Present: Council Members Bourbeau, Dariz, and Funk and Mayor Moreno Absent: Mayor Pro Tem Newsom Others Present: None Staff Present: City Manager Rachelle Rickard, Administrative Services Director Jeri Rangel, Community Development Director Phil Dunsmore, Police Chief Bob Masterson, Public Works Director Nick DeBar, City Attorney Brian Pierik, Deputy City Manager/City Clerk Lara Christensen, Battalion Chief Matt Miranda, Deputy Community Development Director Loreli Cappel, and IT Manager Luke Knight APPROVAL OF AGENDA: MOTION: By Council Member Funk and seconded by Council Member Bourbeau to: 1. Approve this agenda; and, 2. Waive the reading in full of all ordinances appearing on this agenda, and the titles of the ordinances will be read aloud by the City Clerk at the first reading, after the motion and before the City Council votes. Motion passed 4:0 by a roll-call vote. Newsom absent. City Council Regular Session: 6:00 P.M. Page 7 of 114 ITEM NUMBER: A-1 DATE: 04/26/22 Atascadero City Council April 12, 2022 Page 2 of 5 CLOSED SESSION – REPORT (IF ANY) City Attorney Pierik reported there was no reportable action from March 22, 2022. PRESENTATIONS: 1. Proclamation proclaiming the last week of April as World War II Commemoration Week Council presented the Proclamation to Lieutenant Colonel Erik Brun from the Educational Outreach Committee of the History Center of San Luis Obispo County. A. CONSENT CALENDAR: 1. City Council Draft Action Minutes – March 22, 2022 ▪ Recommendation: Council approve the March 22, 2022 Draft City Council Regular Meeting Minutes. [City Clerk] 2. Weed/Refuse Abatement Program ▪ Fiscal Impact: The City recovers costs for administering this program. Parcels not abated are charged the contractor fee for abatement, plus a flat fee of $260 plus a charge equal to 166% of the contractor’s fee to abate. The total charge is placed on the San Luis Obispo County Special Tax Assessment for the fiscal year 2022-2023 Tax Roll. ▪ Recommendation: Council adopt Draft Resolution, declaring vegetative growth and/or refuse a public nuisance, commencing proceedings for the abatement of said nuisances, and placing all abatement fees on the San Luis Obispo County Special Tax Assessment for the fiscal year 2022-2023 Tax Roll. [Fire Department] 3. Virtual Meetings – AB 361 Requirements ▪ Fiscal Impact: None. ▪ Recommendation: Council adopt Draft Resolution making findings consistent with the requirements of AB 361 to continue to allow for the conduct of virtual meetings. [City Manager] 4. 2021 Measure F-14 Pavement Resurfacing and Street and Storm Drain Maintenance District No. 2 (Las Lomas) Resurfacing Construction Award ▪ Fiscal Impact: $505,297.00 ▪ Recommendation: Council award a construction contract for $505,297.00 to Souza Construction, Inc. for the 2021 Measure F-14 Pavement Resurfacing and Street and Storm Drain Maintenance District No. 2 (Las Lomas) Pavement Management Project (Project No. C2020R03). [Public Works] MOTION: By Council Member Dariz and seconded by Council Member Funk to approve the Consent Calendar. (#A-2: Resolution No. 2022-009) (#A-3: Resolution No. 2022-010)(#A-4: Contract No. 2022-004) Motion passed 4:0 by a roll-call vote. Newsom absent. Page 8 of 114 ITEM NUMBER: A-1 DATE: 04/26/22 Atascadero City Council April 12, 2022 Page 3 of 5 UPDATES FROM THE CITY MANAGER: City Manager Rickard gave an update on projects and events within the City. COMMUNITY FORUM: The following persons spoke in-person, by telephone, or through the webinar: Debbie Arnold and Geoff Auslen Mayor Moreno closed the COMMUNITY FORUM period. B. PUBLIC HEARINGS: 1. Centennial Plaza Planned Development - Zone Change (ZCH) 22-0022 - 5901 East Mall ▪ Fiscal Impact: None. ▪ Recommendation: Council introduce for first reading, by title only, a Draft Ordinance, amending the Atascadero Municipal Code, Title 9 Planning & Zoning, Section 9-3, Article 26, adding Section 9-3.682 to add a new Planned Development Overlay Zone 37 for the five vacant lots surrounding Centennial Plaza and including Centennial Plaza (lots 12-17), based on findings and subject to the future approval of a Master Plan of Development. [Community Development] Mayor Moreno reported that this item would be continued to the next meeting. PUBLIC COMMENT: The following persons spoke on this item: None Mayor Moreno did not close the Public Comment period. Mayor Moreno noted that the Public Hearing would be continued to April 26, 2022. C. MANAGEMENT REPORTS: 1. Approval of North San Luis Obispo County Broadband Strategic Plan Memorandum of Understanding ▪ Fiscal Impact: The action would formally appropriate $388,110 in SB 1090 funds previously identified, but not formally appropriated, for broadband projects. Signing the MOU has no fiscal impact since the MOU is non-binding in all respects. ▪ Recommendations: Council: 1. Authorize the Mayor to execute a Memorandum of Understanding with the City of Paso Robles to memorialize and express the intent of the City of El Paso de Robles and the City of Atascadero to explore an operational relationship developing a northern San Luis Obispo County Broadband Strategic Plan. Page 9 of 114 ITEM NUMBER: A-1 DATE: 04/26/22 Atascadero City Council April 12, 2022 Page 4 of 5 2. Authorize the Director of Administrative Services to appropriate $388,110 of SB 1090 funds (previously recognized as revenue when received) for the Broadband Enhancement Project. [City Manager] Deputy Community Development Director Loreli Cappel gave the presentation and answered questions from the Council. PUBLIC COMMENT: The following persons spoke on this item: Geoff Auslen and Paul Sloan Mayor Moreno closed the Public Comment period. MOTION: By Council Member Bourbeau and seconded by Council Member Funk to: 1. Authorize the Mayor to execute a Memorandum of Understanding (Contract No. 2022-005) with the City of Paso Robles to memorialize and express the intent of the City of El Paso de Robles and the City of Atascadero to explore an operational relationship developing a northern San Luis Obispo County Broadband Strategic Plan. 2. Authorize the Director of Administrative Services to appropriate $388,110 of SB 1090 funds (previously recognized as revenue when received) for the Broadband Enhancement Project. Motion passed 4:0 by a roll-call vote. Newsom absent. Mayor Moreno recessed the meeting at 7:34 p.m. Mayor Moreno reconvened the meeting with all present at 7:42 p.m. D. STUDY SESSION: 1. Update on Council Goals and Action Plan ▪ Fiscal Impact: None. ▪ Recommendations: Council: 1. Discuss and provide additional direction regarding performance measures; and 2. Receive oral report on the progress being made relative to the City Council’s goals. [City Manager] City Manager Rickard introduced the item and provided a brief background on the 2021-2023 Action Plan and all staff present gave updates on the progress being made relative to the City Council goals and answered questions from the Council. PUBLIC COMMENT: The following persons spoke on this item: None The City Council received the oral report on the 2021-2023 Action Plan progress and provided direction to staff regarding performance measures. Page 10 of 114 ITEM NUMBER: A-1 DATE: 04/26/22 Atascadero City Council April 12, 2022 Page 5 of 5 E. COUNCIL ANNOUNCEMENTS AND COMMITTEE REPORTS: The following Council Members gave brief update reports on their committees since their last Council meeting: Mayor Moreno 1. County Mayors Round Table 2. SLO Council of Governments (SLOCOG) Council Member Bourbeau 1. City / Schools Committee 2. Integrated Waste Management Authority (IWMA) Council Member Dariz 1. Community Action Partnership SLO (CAPSLO) Council Member Funk 1. Design Review Committee 2. Homeless Services Oversight Council F. INDIVIDUAL DETERMINATION AND / OR ACTION: None G. ADJOURN Mayor Moreno adjourned the Regular Meeting at 8:52 p.m. to the Special Closed Session. MINUTES PREPARED BY: ______________________________________ Lara K. Christensen City Clerk APPROVED: Page 11 of 114 ITEM NUMBER: A-1 DATE: 04/26/22 Atascadero City Council Special Meeting April 12, 2022 Page 1 of 2 SPECIAL MEETING ATASCADERO CITY COUNCIL CLOSED SESSION Tuesday, April 12, 2022 Immediately following the City Council Regular Session Atascadero City Hall Council Chambers, 4th Floor 6500 Palma Avenue, Atascadero, California MINUTES COUNCIL CLOSED SESSION: Immediately following City Council Regular Session Mayor Moreno called the meeting to order at 9:28 p.m. ROLL CALL: Present: Council Members Bourbeau, Dariz, Funk, and Mayor Moreno Absent: Mayor Pro Tem Newsom Others Present: None Staff Present: City Manager Rachelle Rickard, City Attorney Brian Pierik, Community Development Director Phil Dunsmore, Deputy City Manager/City Clerk Lara Christensen, Deputy Community Development Director Loreli Cappel, and IT Manager Luke Knight 1. CLOSED SESSION -- PUBLIC COMMENT – None 2. COUNCIL LEAVES TO BEGIN CLOSED SESSION IT Manager Luke Knight did not attend this portion of the meeting. 3. CLOSED SESSION -- CALL TO ORDER a. Conference with Real Property Negotiators (Govt. Code 54956.8) Real Property: 5970 El Camino Real (APN 030181031) Agency Negotiator: Rachelle Rickard, City Manager Negotiating Parties: Fred C. Pflum Revocable Trust Subject of Negotiations: Purchase price and/or terms of payment. Page 12 of 114 ITEM NUMBER: A-1 DATE: 04/26/22 Atascadero City Council Special Meeting April 12, 2022 Page 2 of 2 4. CLOSED SESSION – ADJOURNMENT 5. COUNCIL RETURNS 6. CLOSED SESSION – REPORT The City Attorney will announce any reportable action(s) taken in Closed Session at the next Regular City Council meeting on April 26, 2022, as Closed Session is not recorded or videotaped. ADJOURNMENT: Mayor Moreno adjourned the Special Meeting at 10:11p.m. to the next Regular Session on April 26, 2022. MINUTES PREPARED BY: ______________________________________ Lara K. Christensen Deputy City Manager / City Clerk APPROVED: Page 13 of 114 ITEM NUMBER: A-2DATE: 04/26/22Page 14 of 114 Check Number Check Date Vendor Description Amount City of Atascadero Disbursement Listing For the Month of March 2022 170328 03/01/2022 ANTHEM BLUE CROSS HEALTH 216,299.57Payroll Vendor Payment 170329 03/01/2022 LINCOLN NATIONAL LIFE INS CO 2,058.55Payroll Vendor Payment 170330 03/01/2022 MEDICAL EYE SERVICES 1,841.31Payroll Vendor Payment 170331 03/01/2022 VOID 0.00Payroll Vendor Payment 170332 03/01/2022 SELF INSURED SERVICE COMP BENEFIT COORDINATORS CORP 9,350.80Payroll Vendor Payment 4330 03/03/2022 ANTHEM BLUE CROSS HSA 10,610.29Payroll Vendor Payment 170333 03/03/2022 ATASCADERO MID MGRS ORG UNION 60.00Payroll Vendor Payment 170334 03/03/2022 ATASCADERO POLICE OFFICERS 1,799.75Payroll Vendor Payment 170335 03/03/2022 ATASCADERO PROF. FIREFIGHTERS 1,096.80Payroll Vendor Payment 170336 03/03/2022 MASS MUTUAL WORKPLACE SOLUTION 7,133.13Payroll Vendor Payment 170337 03/03/2022 NATIONWIDE RETIREMENT SOLUTION 681.67Payroll Vendor Payment 170338 03/03/2022 NAVIA BENEFIT SOLUTIONS 1,674.10Payroll Vendor Payment 170339 03/03/2022 SEIU LOCAL 620 815.54Payroll Vendor Payment 170340 03/03/2022 VANTAGEPOINT TRNSFR AGT 106099 416.88Payroll Vendor Payment 170341 03/03/2022 VANTAGEPOINT TRNSFR AGT 304633 7,138.15Payroll Vendor Payment 170342 03/03/2022 VANTAGEPOINT TRNSFR AGT 706276 585.00Payroll Vendor Payment 4331 03/04/2022 STATE DISBURSEMENT UNIT 467.07Payroll Vendor Payment 4332 03/04/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 21,932.50Payroll Vendor Payment 4333 03/04/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 32,754.77Payroll Vendor Payment 4334 03/04/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 2,145.94Payroll Vendor Payment 4335 03/04/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 2,650.48Payroll Vendor Payment 4336 03/04/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 6,709.33Payroll Vendor Payment 4337 03/04/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 8,341.11Payroll Vendor Payment 4338 03/04/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 9,537.26Payroll Vendor Payment 4339 03/04/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 16,579.03Payroll Vendor Payment 4340 03/08/2022 RABOBANK, N.A. 54,452.82Payroll Vendor Payment 4341 03/08/2022 EMPLOYMENT DEV DEPARTMENT 16,862.57Payroll Vendor Payment 4342 03/08/2022 EMPLOYMENT DEV. DEPARTMENT 2,742.57Payroll Vendor Payment 170343 03/08/2022 WEX BANK - 76 UNIVERSL 11,996.87Accounts Payable Check 170344 03/08/2022 WEX BANK - WEX FLEET UNIVERSAL 8,198.81Accounts Payable Check 170345 03/11/2022 13 STARS MEDIA 541.08Accounts Payable Check 170346 03/11/2022 2 MEXICANS, LLC 6,495.50Accounts Payable Check 170347 03/11/2022 ADAMSKI,MOROSKI,MADDEN, 1,019.50Accounts Payable Check 170348 03/11/2022 AIRGAS USA, LLC 380.70Accounts Payable Check 170349 03/11/2022 ALLIANT INSURANCE SERVICES INC 296.00Accounts Payable Check 170350 03/11/2022 ALTHOUSE & MEADE, INC. 1,536.25Accounts Payable Check 170351 03/11/2022 AMERICAN WEST TIRE & AUTO INC 57.50Accounts Payable Check 170352 03/11/2022 DREW T. ARDOUIN 90.00Accounts Payable Check 170353 03/11/2022 AT&T 253.98Accounts Payable Check 170354 03/11/2022 AT&T 33.98Accounts Payable Check 170356 03/11/2022 ATASCADERO MUTUAL WATER CO. 8,814.14Accounts Payable Check 170357 03/11/2022 AURORA WORLD, INC. 2,107.48Accounts Payable Check 170358 03/11/2022 BAUER COMPRESSORS 490.46Accounts Payable Check ITEM NUMBER: A-2 DATE: 04/26/22 ATTACHMENT: 1 Page 15 of 114 Check Number Check Date Vendor Description Amount City of Atascadero Disbursement Listing For the Month of March 2022 170359 03/11/2022 BAY AREA DRIVING SCHOOL, INC. 55.99Accounts Payable Check 170360 03/11/2022 KEITH R. BERGHER 168.75Accounts Payable Check 170361 03/11/2022 BERRY MAN, INC. 406.35Accounts Payable Check 170362 03/11/2022 ETHAN T. BLAIS 48.00Accounts Payable Check 170363 03/11/2022 KABELO E. BLAIS 96.00Accounts Payable Check 170364 03/11/2022 BOUND TREE MEDICAL, LLC 2,965.16Accounts Payable Check 170365 03/11/2022 BRANCH SMITH PROPERTIES 374.00Accounts Payable Check 170366 03/11/2022 BREZDEN PEST CONTROL, INC. 170.00Accounts Payable Check 170367 03/11/2022 BURKE,WILLIAMS, & SORENSON LLP 30,147.16Accounts Payable Check 170368 03/11/2022 CARQUEST OF ATASCADERO 257.46Accounts Payable Check 170369 03/11/2022 CENTRAL COAST BREWERS GUILD 5,000.00Accounts Payable Check 170370 03/11/2022 CHARTER COMMUNICATIONS 3,139.47Accounts Payable Check 170371 03/11/2022 KAREN A. CLANIN 399.00Accounts Payable Check 170372 03/11/2022 CLEVER CONCEPTS, INC. 47.95Accounts Payable Check 170373 03/11/2022 CO OF SAN LUIS OBISPO SART PRG 3,810.00Accounts Payable Check 170374 03/11/2022 COASTAL COPY, INC. 275.19Accounts Payable Check 170375 03/11/2022 BETHANY D. COLLINS 350.00Accounts Payable Check 170376 03/11/2022 COUNTY OF SAN LUIS OBISPO 63.00Accounts Payable Check 170377 03/11/2022 CRYSTAL CREAMERY, INC. 1,180.40Accounts Payable Check 170378 03/11/2022 CRYSTAL SPRINGS WATER 20.00Accounts Payable Check 170379 03/11/2022 CULLIGAN/CENTRAL COAST WTR TRT 70.00Accounts Payable Check 170380 03/11/2022 JAROM M. DAMERY 136.00Accounts Payable Check 170381 03/11/2022 SHARON J. DAVIS 409.50Accounts Payable Check 170382 03/11/2022 NICHOLAS DEBAR 300.00Accounts Payable Check 170383 03/11/2022 JOE DEBRUIN, PH.D. 360.00Accounts Payable Check 170384 03/11/2022 DELTA LIQUID ENERGY 1,287.88Accounts Payable Check 170385 03/11/2022 DESTINATION TRAVEL NETWORK 75.00Accounts Payable Check 170386 03/11/2022 PHILIP DUNSMORE 300.00Accounts Payable Check 170387 03/11/2022 EARTH SYSTEMS PACIFIC 3,167.50Accounts Payable Check 170388 03/11/2022 EIKHOF DESIGN GROUP, INC. 2,987.00Accounts Payable Check 170389 03/11/2022 ALI ELMASRI 119.00Accounts Payable Check 170390 03/11/2022 EN FUEGO EVENTS 10,000.00Accounts Payable Check 170391 03/11/2022 ENTENMANN-ROVIN CO. 540.20Accounts Payable Check 170392 03/11/2022 STEVEN J. ERNST 96.00Accounts Payable Check 170393 03/11/2022 ETHAN J. FANNING 144.00Accounts Payable Check 170394 03/11/2022 FGL ENVIRONMENTAL 243.00Accounts Payable Check 170395 03/11/2022 FIESTA MAHAR MANUFACTURNG CORP 856.86Accounts Payable Check 170396 03/11/2022 FILIPPIN ENGINEERING, INC. 42,498.38Accounts Payable Check 170397 03/11/2022 FIRE CHIEFS ASSC OF SLO CO 3,022.00Accounts Payable Check 170398 03/11/2022 GAS COMPANY 1,606.45Accounts Payable Check 170399 03/11/2022 ELIAS E. GONZALES 255.00Accounts Payable Check 170400 03/11/2022 DANIEL J. GRASSESCHI 450.00Accounts Payable Check 170401 03/11/2022 TRISTAN M. GUILLORY 170.00Accounts Payable Check ITEM NUMBER: A-2 DATE: 04/26/22 ATTACHMENT: 1 Page 16 of 114 Check Number Check Date Vendor Description Amount City of Atascadero Disbursement Listing For the Month of March 2022 170402 03/11/2022 HANSEN BRO'S CUSTOM FARMING 3,740.00Accounts Payable Check 170403 03/11/2022 HART IMPRESSIONS PRINTING 1,485.23Accounts Payable Check 170405 03/11/2022 HOME DEPOT CREDIT SERVICES 3,483.30Accounts Payable Check 170406 03/11/2022 SETH W HUGHES 249.02Accounts Payable Check 170407 03/11/2022 IRON MOUNTAIN RECORDS MGMNT 125.53Accounts Payable Check 170408 03/11/2022 JK'S UNLIMITED, INC. 1,079.35Accounts Payable Check 170409 03/11/2022 JOE A. GONSALVES & SON 3,000.00Accounts Payable Check 170410 03/11/2022 KID TEES 498.60Accounts Payable Check 170411 03/11/2022 LAKE TECH, INC. 10,593.69Accounts Payable Check 170412 03/11/2022 LIFE ASSIST, INC. 1,154.54Accounts Payable Check 170413 03/11/2022 REBECCA N. LILLEY 27.00Accounts Payable Check 170414 03/11/2022 LINDE GAS & EQUIPMENT INC. 63.04Accounts Payable Check 170415 03/11/2022 MADRONE LANDSCAPES, INC. 413.00Accounts Payable Check 170416 03/11/2022 MAILSTREAM, INC. 2,131.71Accounts Payable Check 170417 03/11/2022 MANZANITA NURSERY 274.19Accounts Payable Check 170418 03/11/2022 LINDA K. MARTIN 350.00Accounts Payable Check 170419 03/11/2022 CRAIG MARTINEAU 1,600.00Accounts Payable Check 170420 03/11/2022 MCCLATCHY SHARED SERVICES, LLC 107.00Accounts Payable Check 170421 03/11/2022 WADE MCKINNEY 486.51Accounts Payable Check 170422 03/11/2022 MEYER TREE CONSULTING 1,125.00Accounts Payable Check 170423 03/11/2022 MICHAEL K. NUNLEY & ASSC, INC. 16,118.73Accounts Payable Check 170424 03/11/2022 MID-COAST MOWER & SAW, INC. 131.54Accounts Payable Check 170425 03/11/2022 MIG 14,116.14Accounts Payable Check 170426 03/11/2022 MINER'S ACE HARDWARE 305.50Accounts Payable Check 170427 03/11/2022 MISSION UNIFORM SERVICE 313.96Accounts Payable Check 170428 03/11/2022 MP ANNEX, LLC 49,160.62Accounts Payable Check 170429 03/11/2022 DAVE MUEHLHAUSEN 85.00Accounts Payable Check 170430 03/11/2022 MV TRANSPORTATION, INC. 15,463.66Accounts Payable Check 170431 03/11/2022 KELLYE R. NETZ 510.00Accounts Payable Check 170432 03/11/2022 NIELSEN,MERKSAMER,PARRINELLO, 3,365.50Accounts Payable Check 170433 03/11/2022 NORTH COUNTY CARPET CLEANERS 400.00Accounts Payable Check 170434 03/11/2022 OFFICE DEPOT INC. 1,575.40Accounts Payable Check 170437 03/11/2022 PACIFIC GAS AND ELECTRIC 38,685.37Accounts Payable Check 170438 03/11/2022 PASO ROBLES ICE COMPANY 824.75Accounts Payable Check 170439 03/11/2022 PEAKWIFI, LLC 650.00Accounts Payable Check 170440 03/11/2022 PENGUIN RANDOM HOUSE, LLC 659.22Accounts Payable Check 170441 03/11/2022 PERRY'S PARCEL & GIFT 50.00Accounts Payable Check 170442 03/11/2022 PETERSON U-CART 190.93Accounts Payable Check 170443 03/11/2022 PIERRE RADEMAKER DESIGN 3,327.29Accounts Payable Check 170444 03/11/2022 PORTER CONSTRUCTION, INC. 25,540.00Accounts Payable Check 170445 03/11/2022 PROCARE JANITORIAL SUPPLY,INC. 165.58Accounts Payable Check 170446 03/11/2022 GERALD D. PURIFY JR. 600.00Accounts Payable Check 170447 03/11/2022 QUINCY ENGINEERING, INC. 15,822.80Accounts Payable Check ITEM NUMBER: A-2 DATE: 04/26/22 ATTACHMENT: 1 Page 17 of 114 Check Number Check Date Vendor Description Amount City of Atascadero Disbursement Listing For the Month of March 2022 170448 03/11/2022 RADAR SHOP, INC. 796.00Accounts Payable Check 170449 03/11/2022 RAINSCAPE, A LANDSCAPE SVC CO. 27,043.04Accounts Payable Check 170450 03/11/2022 RAMINHA CONSTRUCTION, INC. 6,056.25Accounts Payable Check 170451 03/11/2022 JERI RANGEL 300.00Accounts Payable Check 170452 03/11/2022 READYREFRESH BY NESTLE 172.20Accounts Payable Check 170453 03/11/2022 RECOGNITION WORKS 16.69Accounts Payable Check 170454 03/11/2022 RHODE ISLAND NOVELTY 1,840.08Accounts Payable Check 170455 03/11/2022 RACHELLE RICKARD 300.00Accounts Payable Check 170456 03/11/2022 BRIAN S. RICKS 96.00Accounts Payable Check 170457 03/11/2022 ISAIAH D. RODRIGUEZ 336.00Accounts Payable Check 170458 03/11/2022 MARCELES RODRIGUEZ 600.00Accounts Payable Check 170459 03/11/2022 ROLSON MUSIC & SOUND 3,550.00Accounts Payable Check 170460 03/11/2022 THE SHERWIN-WILLIAMS COMPANY 56.02Accounts Payable Check 170461 03/11/2022 SITEONE LANDSCAPE SUPPLY, LLC 516.88Accounts Payable Check 170462 03/11/2022 SOUZA CONSTRUCTION, INC. 68,889.54Accounts Payable Check 170463 03/11/2022 SPEAKWRITE, LLC. 722.22Accounts Payable Check 170464 03/11/2022 SPECIALIZED EQUIPMENT REPAIR 1,800.07Accounts Payable Check 170465 03/11/2022 STAPLES CREDIT PLAN 34.02Accounts Payable Check 170466 03/11/2022 SUNLIGHT JANITORIAL, INC. 2,661.00Accounts Payable Check 170467 03/11/2022 RONALD R. TARICA 108.00Accounts Payable Check 170468 03/11/2022 TERRA VERDE ENVIRONMENTAL CONS 387.39Accounts Payable Check 170469 03/11/2022 TESCO CONTROLS, INC. 5,808.00Accounts Payable Check 170470 03/11/2022 THOMSON REUTERS - WEST 175.10Accounts Payable Check 170471 03/11/2022 KARL O. TOERGE 123.00Accounts Payable Check 170472 03/11/2022 TRIMOTION MEDIA 600.00Accounts Payable Check 170473 03/11/2022 U.S. POSTAL SERVICE 3,000.00Accounts Payable Check 170474 03/11/2022 RENE VASQUEZ 67.00Accounts Payable Check 170475 03/11/2022 MICHAEL I. VENIA 500.00Accounts Payable Check 170476 03/11/2022 VERIZON WIRELESS 2,237.56Accounts Payable Check 170477 03/11/2022 VILLAGE ORIGINALS, INC. 652.62Accounts Payable Check 170478 03/11/2022 VINO VICE, INC. 527.25Accounts Payable Check 170479 03/11/2022 WCJ PROPERTY SERVICES 1,928.19Accounts Payable Check 170480 03/11/2022 WECK LABRATORIES, INC. 930.00Accounts Payable Check 170481 03/11/2022 WHITLOCK & WEINBERGER TRANS. 2,021.25Accounts Payable Check 170482 03/11/2022 WILKINS ACTION GRAPHICS 320.70Accounts Payable Check 170483 03/11/2022 KAREN B. WYKE 343.80Accounts Payable Check 170484 03/11/2022 YOUTH EVOLUTION SOCCER 3,330.00Accounts Payable Check 170485 03/11/2022 ZEE MEDICAL SERVICES CO. 707.92Accounts Payable Check 4343 03/14/2022 BANK OF NEW YORK MELLON 348,306.25Accounts Payable Check 4344 03/17/2022 ANTHEM BLUE CROSS HSA 9,235.29Payroll Vendor Payment 170486 03/17/2022 ATASCADERO MID MGRS ORG UNION 60.00Payroll Vendor Payment 170487 03/17/2022 ATASCADERO POLICE OFFICERS 1,799.75Payroll Vendor Payment 170488 03/17/2022 ATASCADERO PROF. FIREFIGHTERS 1,096.80Payroll Vendor Payment ITEM NUMBER: A-2 DATE: 04/26/22 ATTACHMENT: 1 Page 18 of 114 Check Number Check Date Vendor Description Amount City of Atascadero Disbursement Listing For the Month of March 2022 170489 03/17/2022 MASS MUTUAL WORKPLACE SOLUTION 7,146.96Payroll Vendor Payment 170490 03/17/2022 NATIONWIDE RETIREMENT SOLUTION 647.16Payroll Vendor Payment 170491 03/17/2022 NAVIA BENEFIT SOLUTIONS 1,674.10Payroll Vendor Payment 170492 03/17/2022 SEIU LOCAL 620 816.62Payroll Vendor Payment 170493 03/17/2022 VANTAGEPOINT TRNSFR AGT 106099 416.88Payroll Vendor Payment 170494 03/17/2022 VANTAGEPOINT TRNSFR AGT 304633 7,261.29Payroll Vendor Payment 170495 03/17/2022 VANTAGEPOINT TRNSFR AGT 706276 285.00Payroll Vendor Payment 4345 03/18/2022 STATE DISBURSEMENT UNIT 467.07Payroll Vendor Payment 4346 03/18/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 21,932.50Payroll Vendor Payment 4347 03/18/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 33,643.80Payroll Vendor Payment 4348 03/18/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 2,184.23Payroll Vendor Payment 4349 03/18/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 2,650.48Payroll Vendor Payment 4350 03/18/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 6,709.33Payroll Vendor Payment 4351 03/18/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 8,354.72Payroll Vendor Payment 4352 03/18/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 9,764.85Payroll Vendor Payment 4353 03/18/2022 CALIF PUBLIC EMPLOYEES RETIREMENT SYSTEM 16,962.74Payroll Vendor Payment 4354 03/22/2022 RABOBANK, N.A. 57,014.32Payroll Vendor Payment 4355 03/22/2022 EMPLOYMENT DEV DEPARTMENT 17,662.60Payroll Vendor Payment 4356 03/22/2022 EMPLOYMENT DEV. DEPARTMENT 2,775.03Payroll Vendor Payment 170496 03/25/2022 13 STARS MEDIA 409.03Accounts Payable Check 170497 03/25/2022 2 MEXICANS, LLC 2,817.50Accounts Payable Check 170498 03/25/2022 A.M. SUN SOLAR 149.14Accounts Payable Check 170499 03/25/2022 ACCESS PUBLISHING 200.00Accounts Payable Check 170500 03/25/2022 ADDICTION MEDICINE CONSULTANTS 600.00Accounts Payable Check 170501 03/25/2022 AGP VIDEO, INC. 2,610.00Accounts Payable Check 170502 03/25/2022 AIR-RITE HEATING & COOLING 416.40Accounts Payable Check 170503 03/25/2022 AK & COMPANY 1,750.00Accounts Payable Check 170504 03/25/2022 ALLIANT INSURANCE SERVICES INC 330.00Accounts Payable Check 170505 03/25/2022 ALTHOUSE & MEADE, INC. 1,002.50Accounts Payable Check 170506 03/25/2022 AMERICAN WEST TIRE & AUTO INC 2,330.40Accounts Payable Check 170507 03/25/2022 ANTECH DIAGNOSTICS 557.02Accounts Payable Check 170508 03/25/2022 KELLY AREBALO 97.00Accounts Payable Check 170510 03/25/2022 AT&T 1,256.38Accounts Payable Check 170511 03/25/2022 AT&T 1,194.71Accounts Payable Check 170512 03/25/2022 ATASCADERO HAY & FEED 2,421.46Accounts Payable Check 170513 03/25/2022 TERRIE BANISH 63.18Accounts Payable Check 170514 03/25/2022 BASSETT'S CRICKET RANCH,INC. 881.38Accounts Payable Check 170515 03/25/2022 BERRY MAN, INC. 1,515.30Accounts Payable Check 170516 03/25/2022 ETHAN T. BLAIS 80.00Accounts Payable Check 170517 03/25/2022 BURT INDUSTRIAL SUPPLY 395.31Accounts Payable Check 170518 03/25/2022 CALIFORNIA BUILDING OFFICIALS 70.00Accounts Payable Check 170519 03/25/2022 CALPORTLAND COMPANY 427.19Accounts Payable Check 170520 03/25/2022 CAPITAL ONE TRADE CREDIT 342.55Accounts Payable Check ITEM NUMBER: A-2 DATE: 04/26/22 ATTACHMENT: 1 Page 19 of 114 Check Number Check Date Vendor Description Amount City of Atascadero Disbursement Listing For the Month of March 2022 170521 03/25/2022 CARQUEST OF ATASCADERO 182.29Accounts Payable Check 170522 03/25/2022 CASEY PRINTING, INC. 1,905.30Accounts Payable Check 170523 03/25/2022 CHARTER COMMUNICATIONS 4,586.69Accounts Payable Check 170524 03/25/2022 CIRCLE GRAPHICS, INC. 452.66Accounts Payable Check 170525 03/25/2022 CRYSTAL CREAMERY, INC. 356.28Accounts Payable Check 170526 03/25/2022 DESTINY CUELLAR 600.00Accounts Payable Check 170527 03/25/2022 JAROM M. DAMERY 85.00Accounts Payable Check 170528 03/25/2022 DEPARTMENT OF JUSTICE 154.00Accounts Payable Check 170529 03/25/2022 DEPT. OF INDUSTRIAL RELATIONS 225.00Accounts Payable Check 170530 03/25/2022 DOGGIE WALK BAGS COMPANY 295.14Accounts Payable Check 170531 03/25/2022 ECONOMIC & PLANNING SYSTEM INC 2,500.00Accounts Payable Check 170532 03/25/2022 ALI ELMASRI 85.00Accounts Payable Check 170533 03/25/2022 STEVEN J. ERNST 48.00Accounts Payable Check 170534 03/25/2022 ESCUELA DEL RIO 660.00Accounts Payable Check 170535 03/25/2022 JENNIFER FANNING 138.00Accounts Payable Check 170536 03/25/2022 FENCE FACTORY ATASCADERO 250.00Accounts Payable Check 170537 03/25/2022 FGL ENVIRONMENTAL 162.00Accounts Payable Check 170538 03/25/2022 FIRE CHIEFS ASSC OF SLO CO 60.00Accounts Payable Check 170539 03/25/2022 FORT WAYNE CHILDRENS ZOO 399.04Accounts Payable Check 170540 03/25/2022 GAS COMPANY 2,355.79Accounts Payable Check 170541 03/25/2022 ALEX GENTILLY 180.00Accounts Payable Check 170542 03/25/2022 ELIAS E. GONZALES 119.00Accounts Payable Check 170543 03/25/2022 TRISTAN M. GUILLORY 85.00Accounts Payable Check 170544 03/25/2022 HAMNER, JEWELL & ASSOCIATES 551.37Accounts Payable Check 170545 03/25/2022 HANSEN BRO'S CUSTOM FARMING 13,090.00Accounts Payable Check 170546 03/25/2022 REBECCA HEREDIA 115.94Accounts Payable Check 170547 03/25/2022 HINDERLITER, DE LLAMAS 2,274.88Accounts Payable Check 170548 03/25/2022 RACHEL HUNTER 1,600.00Accounts Payable Check 170549 03/25/2022 INFINITY CABLE PRODUCTS 302.98Accounts Payable Check 170550 03/25/2022 J. CARROLL CORPORATION 273.43Accounts Payable Check 170551 03/25/2022 EMILY F. JENNINGS 30.00Accounts Payable Check 170552 03/25/2022 JK'S UNLIMITED, INC. 1,644.45Accounts Payable Check 170553 03/25/2022 JOE A. GONSALVES & SON 3,000.00Accounts Payable Check 170554 03/25/2022 DAREN KENNETT 250.00Accounts Payable Check 170555 03/25/2022 DUSTIN KING 250.00Accounts Payable Check 170556 03/25/2022 KNECHT'S PLUMBING & HEATING 2,344.03Accounts Payable Check 170557 03/25/2022 KPRL 1230 AM 320.00Accounts Payable Check 170558 03/25/2022 KTU+A 131.00Accounts Payable Check 170559 03/25/2022 L.N. CURTIS & SONS 83,876.70Accounts Payable Check 170560 03/25/2022 LEE WILSON ELECTRIC CO. INC 2,365.56Accounts Payable Check 170561 03/25/2022 LIFE ASSIST, INC. 734.52Accounts Payable Check 170562 03/25/2022 JACKSON LIGHT 180.00Accounts Payable Check 170563 03/25/2022 LARISSE LOPEZ 138.00Accounts Payable Check ITEM NUMBER: A-2 DATE: 04/26/22 ATTACHMENT: 1 Page 20 of 114 Check Number Check Date Vendor Description Amount City of Atascadero Disbursement Listing For the Month of March 2022 170564 03/25/2022 MAINLINE UTILITY CO. 1,000.00Accounts Payable Check 170565 03/25/2022 MARBORG INDUSTRIES 62.28Accounts Payable Check 170566 03/25/2022 MARK'S TIRE SERVICE 123.70Accounts Payable Check 170567 03/25/2022 MBS LAND SURVEYS 3,500.00Accounts Payable Check 170568 03/25/2022 MCMASTER-CARR SUPPLY CO. 202.68Accounts Payable Check 170569 03/25/2022 MEYER TREE CONSULTING 225.00Accounts Payable Check 170570 03/25/2022 MIG 507.50Accounts Payable Check 170571 03/25/2022 MINER'S ACE HARDWARE 649.56Accounts Payable Check 170572 03/25/2022 MATTHEW J. MIRANDA 206.00Accounts Payable Check 170573 03/25/2022 MISSION UNIFORM SERVICE 428.91Accounts Payable Check 170574 03/25/2022 MOBILE SMALL ENGINE REPAIR 400.00Accounts Payable Check 170575 03/25/2022 KENNA R. MONTGOMERY 30.00Accounts Payable Check 170576 03/25/2022 MORRO BAY BUG COMPANY 547.64Accounts Payable Check 170577 03/25/2022 NIELSEN,MERKSAMER,PARRINELLO, 2,015.50Accounts Payable Check 170578 03/25/2022 NORTH COAST ENGINEERING INC. 802.00Accounts Payable Check 170579 03/25/2022 O.C. TANNER 659.39Accounts Payable Check 170580 03/25/2022 OFFICE DEPOT INC. 238.59Accounts Payable Check 170581 03/25/2022 PACIFIC GAS AND ELECTRIC 31,547.60Accounts Payable Check 170582 03/25/2022 PAPICH CONSTRUCTION CO., INC. 971,088.86Accounts Payable Check 170583 03/25/2022 DEAN PERICIC 816.00Accounts Payable Check 170584 03/25/2022 PERRY'S PARCEL & GIFT 125.00Accounts Payable Check 170585 03/25/2022 PHILADELPHIA ZOO 375.36Accounts Payable Check 170586 03/25/2022 GEOFFREY PHILLIPS 32.00Accounts Payable Check 170587 03/25/2022 PROCARE JANITORIAL SUPPLY,INC. 1,506.26Accounts Payable Check 170588 03/25/2022 PWS, INC. 930.32Accounts Payable Check 170589 03/25/2022 READYREFRESH BY NESTLE 737.15Accounts Payable Check 170590 03/25/2022 SHANENE M. REEVES 30.00Accounts Payable Check 170591 03/25/2022 RICK ENGINEERING COMPANY 15,325.00Accounts Payable Check 170592 03/25/2022 BRIAN S. RICKS 80.00Accounts Payable Check 170593 03/25/2022 BRANDON ROBERTS 180.00Accounts Payable Check 170594 03/25/2022 ISAIAH D. RODRIGUEZ 96.00Accounts Payable Check 170595 03/25/2022 SAN DIEGO POLICE EQUIPMENT CO 6,006.27Accounts Payable Check 170596 03/25/2022 SAN LUIS POWERHOUSE, INC. 2,025.47Accounts Payable Check 170597 03/25/2022 JAMES SCOOLIS 750.00Accounts Payable Check 170598 03/25/2022 SERVICE SYSTEMS ASSC, INC. 5,000.00Accounts Payable Check 170599 03/25/2022 SIGTRONICS CORP. 186.94Accounts Payable Check 170600 03/25/2022 TRINITY J. SILVA 30.00Accounts Payable Check 170601 03/25/2022 SITEONE LANDSCAPE SUPPLY, LLC 534.31Accounts Payable Check 170602 03/25/2022 SLO COUNTY HEALTH AGENCY 150,945.00Accounts Payable Check 170603 03/25/2022 SLO COUNTY HEALTH AGENCY 89,260.00Accounts Payable Check 170604 03/25/2022 SLO COUNTY SHERIFF'S OFFICE 1,510.29Accounts Payable Check 170605 03/25/2022 SPEAKWRITE, LLC. 35.72Accounts Payable Check 170606 03/25/2022 SPECIALTY CONSTRUCTION, INC. 549,967.46Accounts Payable Check ITEM NUMBER: A-2 DATE: 04/26/22 ATTACHMENT: 1 Page 21 of 114 Check Number Check Date Vendor Description Amount City of Atascadero Disbursement Listing For the Month of March 2022 170607 03/25/2022 TARGET SOLUTIONS LEARNING, LLC 93.36Accounts Payable Check 170608 03/25/2022 THOMSON REUTERS - WEST 175.10Accounts Payable Check 170609 03/25/2022 TRI-COUNTY OFFICE FURNITURE 650.02Accounts Payable Check 170610 03/25/2022 TUOLUMNE COUNTY SHERIFF OFFICE 25.25Accounts Payable Check 170611 03/25/2022 TURF STAR, INC. 75,107.61Accounts Payable Check 170615 03/25/2022 U.S. BANK 31,496.22Accounts Payable Check 170616 03/25/2022 ULTREX BUSINESS PRODUCTS 33.23Accounts Payable Check 170617 03/25/2022 UNIVAR SOLUTIONS USA, INC. 5,361.60Accounts Payable Check 170618 03/25/2022 MEGAN L. VAN ALLEN 30.00Accounts Payable Check 170619 03/25/2022 VICTORIA R. VENABLE 30.00Accounts Payable Check 170620 03/25/2022 VERDIN 17,635.72Accounts Payable Check 170621 03/25/2022 VERIZON WIRELESS 746.44Accounts Payable Check 170622 03/25/2022 VINO VICE, INC. 490.25Accounts Payable Check 170623 03/25/2022 VITAL RECORDS CONTROL 184.09Accounts Payable Check 170624 03/25/2022 WILKINS ACTION GRAPHICS 320.25Accounts Payable Check 170625 03/25/2022 WOODLAND PARK ZOOLOGICAL SOCIE 204.06Accounts Payable Check 4357 03/31/2022 ANTHEM BLUE CROSS HSA 9,235.29Payroll Vendor Payment 170626 03/31/2022 ATASCADERO PROF. FIREFIGHTERS 1,096.80Payroll Vendor Payment 170627 03/31/2022 MASS MUTUAL WORKPLACE SOLUTION 7,152.28Payroll Vendor Payment 170628 03/31/2022 NATIONWIDE RETIREMENT SOLUTION 659.28Payroll Vendor Payment 170629 03/31/2022 SEIU LOCAL 620 818.28Payroll Vendor Payment 170630 03/31/2022 VANTAGEPOINT TRNSFR AGT 106099 416.88Payroll Vendor Payment 170631 03/31/2022 VANTAGEPOINT TRNSFR AGT 304633 6,683.49Payroll Vendor Payment 170632 03/31/2022 VANTAGEPOINT TRNSFR AGT 706276 285.00Payroll Vendor Payment $3,666,510.91 ITEM NUMBER: A-2 DATE: 04/26/22 ATTACHMENT: 1 Page 22 of 114 ITEM NUMBER: A-3 DATE: 04/26/22 Atascadero City Council Staff Report – Information Technology Division Radio Repeater Replacement RECOMMENDATIONS: Council: 1. Authorize the City Manager to execute a contract with Applied Technology Group, Inc. in the amount of $287,529 for the purchase and installation of radio repeater equipment and related hardware for the City’s radio communication system. 2. Authorize the Director of Administrative Services to appropriate up to $12,500 in Dial-a-Ride funds for the local match. DISCUSSION: The City’s radio system provides a platform for City staff to communicate daily. During an emergency, radio communications become more critical as other communication methods may become unreliable or unavailable. The regular maintenance and lifecycle replacement of radio equipment will increase the reliability of these systems. The City’s radio repeaters are past end-of-life and in need of replacement. As part of the radio system, radio repeaters receive and retransmit radio signals in order to extend the range of mobile and handheld radios to allow them to communicate with other radios past their limited range. The current Kenwood radio repeaters are no longer available for purchase and therefore ongoing maintenance and replacement of these repeaters is not sustainable. Replacement of the Police repeaters with new Tait repeaters has already taken place due to equipment failure as a result of age and lightning damage. Radio repeaters for Fire, Public Works and Dial-a-Ride now need to be replaced as well. This proposal would replace the remaining aging repeaters with new Tait repeaters while also installing new repeaters to expand radio coverage for enhanced communication abilities. Repeaters for Fire and Public Works will be replaced at the Pine Mountain, Castlerock and Atascadero State Hospital (ASH) communication sites. New repeaters will be installed for Fire and Public Works at the new Templeton communication site to expand coverage on the north side of town. The single repeater for Dial-a-Ride will be replaced at Castlerock and new repeaters will be installed at Pine Mountain and ASH, which will dramatically increase radio coverage Page 23 of 114 ITEM NUMBER: A-3 DATE: 04/26/22 of all transit operations. The San Luis Obispo Council of Governments (SLOCOG) has authorized $50,000 in Federal Transportation Act 5307 funds for this project, with a required local match of $12,500. Other available Transit funding may be used for the match including funding such as Transportation Development Act (TDA) or American Rescue Plan Act allocated for Transit. Authorizing the expenditure of these budgeted funds will help meet the Fiscal and Infrastructure Efficiency & Sustainability strategic priority set by Council. The additional funds not represented in the expenditures to Applied Technology will be spent on professional services for system design and programming as well as a contingency for additional hardware and installation. FISCAL IMPACT: Adoption of staff recommendations will result in the expenditure of $332,500 on equipment, installation and professional services to replace the radio systems for Atascadero Fire and Emergency Services, the Public Works Department and Atascadero Transit. Hardware Fire 67,106$ Public Works 30,270 Dial-a-Ride 23,002 Expansion Fire 93,477 Public Works 41,690 Dial-a-Ride 31,984 Total Expenditures for Applied Technology Group Other Contracted Services Project Contingency (12%) Total Estimated Funding Uses Budgeted D-20 Funds: Fire Radio Repeater Replacement 180,000$ Budgeted D-20 Funds: Public Works Radio Repeater Replacement 90,000 Dial-a-Ride Funds ($50,000 SLOCOG and $12,500 local match) 62,500 Total Funding Sources ESTIMATED FUNDING USES ESTIMATED FUNDING SOURCES PROJECT FUNDING SURPLUS/(SHORTFALL) 287,529$ 10,000 34,971 332,500$ 332,500$ -$ ATTACHMENTS: None. Page 24 of 114 ITEM NUMBER: A-4 DATE: 04/26/22 Atascadero City Council Management Report – Administrative Services Revision (or Update) to Deed Restriction Requirements on Affordable Housing Moderate-Income Unit Resale RECOMMENDATION: Council adopt Draft Resolution giving the City Manager or designee the authority to waive the requirement to record an affordable housing deed restriction on moderate-income units upon sale to a qualified buyer when the sales price and appraised value are within 2% or below the maximum applicable moderate-income sales price, consistent with the current San Luis Obispo County’s Affordable Housing Standard. DISCUSSION: In 2010 the City Council approved Resolution 2010-017 authorizing the City Manager to waive the requirement to record deed restriction documents for moderate-income units upon sale to a qualified buyer when the sales price and appraised value are within 2% or below the maximum applicable moderate-income sales price. The policy change was targeted at moderate-income units that were unbuilt or unsold at the time the resolution was adopted. Staff is recommending that the policy change be expanded to include existing moderate- income units. In situations where the sales price and appraisal are within 2% or below the maximum moderate-income sales price, the deed restriction and resale requirement can create a disincentive for buyers. Assuming a buyer could purchase a market rate unit for the same cost as a deed restricted affordable unit, there appears to be a disincentive to purchase the affordable unit with a number of deed restrictions and resale requirements recorded on the property. There are a number of ownership housing units that have been deed restricted over the years as part of the City’s inclusionary housing program. The moderate-income deed restrictions call for the home to be sold to moderate-income qualified homebuyers at a price not to exceed the moderate-income price point set by the County. Some of the units with these deed restrictions are coming on the market and are being valued at a market price that is close to the moderate-income restricted price. Similar to new units, the sellers are at a disadvantage as there are the deed restrictions, resale requirements and paperwork associated with the moderate-income unit compared to a similar home at that price point. This could cause the original moderate-income household to have to sell their home at a lower price point (below both market value and the moderate-income restricted price) in order to attract a buyer willing to accept the deed restrictions, resale requirements Page 25 of 114 ITEM NUMBER: A-4 DATE: 04/26/22 and additional paperwork/costs. One of the original goals of the inclusionary program was to provide moderate-income households some of the benefits of home ownership including building equity in their home up to the deed restricted moderate price. The current market conditions, deed restrictions, and City policy are, however, a barrier to allowing the current homeowners to realize the full potential equity allowed under the program. Because of the disincentive to purchase and because the City has been successfully exceeding its RHNA targets in the moderate-income housing category, staff is recommending that the Council expand the policy adopted in resolution 2010-017 to existing moderate-income units. The attached resolution that authorizes the City Manager or designee to waive the moderate-income affordable housing deed restriction at the close of escrow, when the sales price/appraised value of a unit is within 2% or below the County’s Affordable Housing Standard sale price for a moderate-income unit and the unit is sold to an income qualified buyer. The policy would maintain the requirement that the unit must be sold at an affordable moderate-income price and guarantee the buyer had a qualifying income, which is the intent of the affordable housing policy. This update would allow the waiver to apply to new and existing moderate-income units in the Atascadero Affordable Housing Program. This update would not impact low or very low-income units. CONCLUSION: The proposed change would be consistent with the intent of the affordable housing program while removing unnecessary barriers to the sale and purchase of affordable housing units. The proposed policy refinements would: 1. Meet the intent of City’s affordable housing policy by requiring the unit to be sold to a moderate-income certified buyer. 2. Eliminate the disincentive to potential purchaser by removing any future restrictions or cloud on the deed once it is sold to a qualified buyer. 3. Protect the City’s future interest in affordable housing by not removing the restrictions until the unit is sold to a qualified buyer FISCAL IMPACT: No immediate fiscal impact, however this change in policy could reduce the total number of moderate-income units available within the City’s Affordable Housing Program. ATTACHMENT: Draft Resolution Page 26 of 114 ITEM NUMBER: A-4 DATE: ATTACHMENT: 04/26/22 1 DRAFT RESOLUTION RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ATASCADERO, CALIFORNIA, REVISING THE REQUIREMENTS FOR THE SALE OF DEED RESTRICTED, MODERATE-INCOME UNITS WHEN THE SALES PRICE AND APPRAISED VALUE ARE WITHIN 2% OR BELOW THE MAXIMUM APPLICABLE MODERATE-INCOME SALES PRICE WHEREAS, the Atascadero General Plan and Housing Element recognize the importance of providing a range of affordable housing units for the residents and employees of Atascadero; and WHEREAS, the City of Atascadero has adopted an inclusionary housing policy that requires certain development projects to provide 20% of the dwelling units as deed restricted affordable units; and WHEREAS, the City created an equity sharing program for moderate-income inclusionary housing units that permit the units to be converted to market rate units; and WHEREAS, the City’s standard deed restrictions and resale restriction for moderate-income units are nonessential when the appraised value of market rate housing units is within 2% or below the maximum sales prices of moderate-income units; and NOW, THEREFORE BE IT RESOLVED, by the City Council of the City of Atascadero: SECTION 1. The City Council hereby finds and determines that all of the recitals are true and correct. SECTION 2. The City Council does hereby authorize the City Manager or designee to waive the requirement to record the following documents all for moderate-income units upon sale to a qualified buyer when the sales price and appraised value are within 2% or below the maximum applicable moderate-income sales price, as determined by San Luis Obispo County: 1. Deed of trust in favor of City of Atascadero 2. Promissory note (secured by deed of trust) 3. Resale and refinancing restriction agreement 4. Request for Notice of Default for 1st trust deed SECTION 3. This Resolution shall be effective immediately upon passage and adoption. PASSED AND ADOPTED at a regular meeting of the City Council held on the ______ day of _______________, 2022. On motion by Council Member ____ and seconded by Council Member ____, the foregoing Resolution is hereby adopted in its entirety on the following roll call vote: Page 27 of 114 ITEM NUMBER: A-4 DATE: ATTACHMENT: 04/26/22 1 AYES: NOES: ABSENT: ABSTAIN: CITY OF ATASCADERO ______________________________ Heather Moreno, Mayor ATTEST: ______________________________________ Lara K. Christensen, City Clerk APPROVED AS TO FORM: ______________________________________ Brian A. Pierik, City Attorney Page 28 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 Atascadero City Council Staff Report - Community Development Department Centennial Plaza Planned Development Zone Change (ZCH) 22-0022 5901 East Mall RECOMMENDATION: Council introduce for first reading, by title only, a Draft Ordinance, amending the Atascadero Municipal Code, Title 9 Planning & Zoning, Section 9-3, Article 26, adding Section 9-3.682 to add a new Planned Development Overlay Zone 37 for the five vacant lots surrounding Centennial Plaza and including Centennial Plaza (lots 12-17), based on findings and subject to the future approval of a Master Plan of Development. DISCUSSION: Background On September 14, 2021, the City Council held a study session to consider the future use and disposition of the vacant lots on each side of Centennial Plaza. At the hearing, the City Council provided direction to staff to prepare a Planned Development Overlay Zone for the parcels to help guide future development with an emphasis on enriching the downtown and providing for quality aesthetics and economic development. At the same time, the City Council determined that the lots should eventually be utilized for private development that supports desired retail, restaurant and related active uses around Sunken Gardens Park. The following process was outlined at the City Council hearing: 1. Remove the abandoned structure from the site (completed December 2021) 2. Proceed with a Planned Development (PD) Overlay Zone for the sites 3. Prepare a declaration of surplus land, consistent with the Surplus Land Act (SLA) 4. Develop an RFP/RFQ to invite development proposals for the sites, consistent with the PD Overlay Zone The City is now ready to move forward with item 2, proceeding with a PD Overlay Zone for the sites. On March 15, 2022, the Planning Commission reviewed the proposed Planned Development Zone and recommended the City Council adopt the PD Zone as proposed. As a result of questions that have arisen over the past few weeks, several clarifications have been made to the PD Zone text. These clarifications do not change the intent of the PD Zone and remain consistent with the Planning Commission approval. Page 29 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 The PD Zone focuses the list of allowed land uses while providing objective design standards for site planning and building architecture. Incentives to guide development may also be added. The PD Zone will apply to all of the vacant parcels between Dr. Pambrum’s office and the City public parking lot, including the lot that is privately owned and Centennial Plaza itself. The vacant lots around Centennial Plaza are extremely important sites that can provide synergy for the future of downtown. The sites are within the Downtown Commercial Zone, and in accordance with the General Plan, are designated for land uses such as retail, food and beverage services, with offices and residential uses on upper floors. Each lot is only 25 feet wide and approximately 100 feet deep. Alone, the lots might be too small to support development; however, when combined, two or more lots could create a logical development site to accommodate active uses. At least one 50-foot wide development site on each side of the Plaza could accommodate restaurant or retail uses with a multi-story development, accommodating offices, housing, or lodging opportunities, or all of the sites could be combined to create a single, cohesive development site that includes, but preserves, the Plaza. With the appropriate design, the City may wish to allow a development proposal to bridge or encroach onto a portion of Centennial Plaza so long as a public access easement is maintained on the Plaza. The proposed Planned Development property standards allow for a structure that may bridge the Plaza area. Such a design should maintain natural light, pedestrian access, and good visibility. Such an option could create a viable outdoor dining space, or an active storefront location for restaurant and retail uses. The proposed PD includes design parameters that dictate appropriate setbacks for each story and appropriate building height that will not dominate the location. An important factor to consider with any development proposal on these sites is the primary intent of the bridge and Centennial Plaza. These features were built as a visual and activity Page 30 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 connection between Sunken Gardens/City Hall and Colony Square. Keeping a sense of connectivity and some sense of a visual connection between these areas is critical. The appropriate scale and design of a new development could either enhance or reduce this connection. The proposed PD takes this into consideration by maintaining a 20-foot wide clear space on the plaza, reduced building mass with height, and a front setback of ten feet. Additionally, an existing undeveloped alley space at the rear of these sites will help maintain the visual corridor. New development will also help bridge the gap by introducing new active uses, and hopefully new nightlife and activity that will enhance the feeling of safety and security across a wider part of the day and night. Any new development on these sites would be subject to design review for consideration of these factors and to ensure the goal of preserving these features remains in place. Trees on Site The site includes several native and non-native trees. There are five coast live oak trees that appear to be “volunteers” that previously surrounded the vacant building on the site. There is also a large deodar cedar that is near the rear of the site, but is actually not within the parcel. At least two of the native coast live oaks would need to be removed in order to create a logical building pad. The cedar is off-site and would need to be protected and preserved during any site construction. There are no heritage trees on the site; however, the removal of any native tree on this site would require City review and approval as part of a development plan. Parking The site is too small to include on-site parking. As many as 2-3 parking spaces and an access driveway would eliminate a large portion of any ground floor building site. Therefore, the PD provides flexibility on parking while restricting any on-site parking. The proposed PD exempts parking for any restaurant or retail use that is consistent with the PD. Also exempt are land uses upstairs, including transient lodging uses or office uses. However, parking is still required for any non-transient residential uses such as an apartment or other permanent dwelling on the second floor. Such parking would need to be arranged off-site. Land Use Under the existing Downtown Commercial Zoning District (DC), the following land uses are allowed: ✓ Amusement Services ✓ Artisan Foods and Products5 ✓ ATM ✓ Bar/Tavern ✓ Business Support Services ✓ Eating and Drinking Places ✓ Farmers’ Market ✓ General Retail ✓ Libraries, Museums ✓ Microbrewery – Brewpub ✓ Mobile Eating and Drinking Vendors6 ✓ Parks and Playgrounds ✓ Personal Services ✓ Residential Care: 6 Residents or Less4 ✓ Small Family Day Care8 ✓ Tasting Room ✓ Temporary Events ✓ Temporary or Seasonal Sales ✓ Winery – Boutique2 Live work units or any other dwelling units may be allowed above the ground floor. Page 31 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 The following other uses may be allowed with a conditional use permit: ✓ Age Restricted Housing ✓ Financial Services and Banks ✓ Government Offices and Facilities8 ✓ Health Care Services8 ✓ Hotels, Motels ✓ Indoor Recreation Services ✓ Membership Organizations ✓ Public Assembly and Entertainment ✓ Research and Development ✓ Schools ✓ Schools – Business and Vocational ✓ Telecommunications Facility ✓ Temporary Events3 ✓ Transit Stations ✓ Utility Facilities ✓ Utility Infrastructure ✓ Offices9 The allowed land uses in the zoning ordinance permit a fairly wide variety of retail and visitor serving uses on the ground floor while office and residential may be developed above. However, the zoning by itself is somewhat flexible and does not refine land use, building design, and other factors in great detail. Some of these land uses are clearly not appropriate in the Plaza vicinity. Therefore, the City Council directed staff to proceed with the adoption of a Planned Development Overlay Zone (PD) on these properties in order to dictate building and site design to refine the list of land uses in a fashion that more specifically speaks to General Plan policy, along with current desired development goals for these sites. The underlying zoning district would remain, while the Overlay Zone would be adopted with additional requirements and standards. The PD would dictate building height, building design and articulation, incorporation of outdoor dining spaces in addition to patios, decks, rooftop features and even signs and lighting, regardless of owner. The PD would also refine the list of allowed land uses to ensure that the ground floor is only utilized for food and beverage services, active retail uses, or related similar land uses. In addition, the PD would also refine what land uses are on upper floors and specify size and design of spaces. However, the PD may not restrict or reduce the allowed residential density for upper floors in a fashion that is inconsistent with City Housing Goals or with the intent of the Surplus Land Act. Proposed land uses for the ground floor of the new PD include: ✓ Artisan Foods and Products ✓ Bar/Tavern ✓ Eating and Drinking Places ✓ General Retail* (with additional parameters- see below) ✓ Microbrewery – Brewpub ✓ Tasting Room ✓ Winery – Boutique ✓ Open space areas for passive outdoor use including walking, gathering, public entertainment, seating, and related, dedicated for use to the public. The PD would further refine the type of General Retail uses. The following parameters are suggested: • Minimum operating hours (4 days per week, 6 hours per day, and open until at least 7 PM) Page 32 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 • The following retail uses shall not be allowed: Building materials and hardware, medical supplies, office supplies, or other items that do not contribute to the synergy, pedestrian orientation and general plan consistency for the downtown. Proposed land uses for upper floors (to include all uses allowed on ground floor): ✓ All uses as allowed on ground floor list ✓ Business Support Services ✓ Live/Work Unit ✓ Lodging/hotel/motel/vacation rental ✓ Multifamily Dwelling ✓ Personal Services ✓ Offices It will be important to retain residential uses as an allowed use above the ground floor just like other locations in the downtown. This is because AB 1486 (Surplus Land Act) requires that any property owned by the City that is transferred to private ownership must first be declared as surplus land and offered to affordable housing developers, subject to existing zoning, prior to offering the land to the general public. If a developer of affordable housing signals an interest in the sites, then the City would need to enter into a good faith negotiation with that developer. (Given the small site area, low number of units, and requirement to build commercial on the ground floor, these sites may not be conducive to affordable housing development.) A discussion on the Surplus Land Act will be brought to the Council at a later date should the Council direct staff to continue to proceed with the surplus land disposition. Property Development Standards The PD overlay will govern site and building design in addition to land use. Currently, the downtown commercial zone prescribes the following development standards: • Front yard setback: None allowed, except for building insets designed for outdoor dining. • Side and rear setback: None required • Height: 45 feet • Parking: Only required for lodging, residential and office • Density: 20 dwellings per acre The intent of the proposed Planned Development is to incentivize and streamline commercial development that can contribute to the synergy of downtown. Staff is proposing the following change to the development standards for this site: • Front yard setback: 10-foot building setback shall be required for ground floor portions of the building; setback may be utilized for outdoor dining, awnings, second or third story building projections such as decks, patios or other floor area, signs and other features designed to enhance the public space. • Parking: No on-site parking shall be allowed. Parking required for residential uses shall be required at the rate of one space per two bedrooms (minimum one space per unit), to be located off-site within 1,000 feet of the property boundary and provided in perpetuity through an off-site parking agreement. No parking required for transient lodging, office uses, and allowed ground floor uses. • Height: 45 feet, maximum of three stories. Each floor above the ground floor is required to have 10% less floor area than the floor below—therefore, upper floors Page 33 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 will be set back from lower floors. Use of roof area permitted for occupancy and outdoor uses. Non-habitable roof projections such as elevator enclosures, parapet walls, roof forms, and other architectural features may extend above the maximum height up to 8 feet. • Rear setback: Although no rear setback is required by the new PD, there is already a built-in setback due to the easement space between the rear of each lot and the existing concrete pathway. This gap is approximately 15-20 feet wide, creating a large view corridor and use area behind any future development. Site and Building Design Planned Development Overlay Zones can include specific site and building design parameters. Staff is suggesting the following design standards for future development: a) A single development project shall be completed on the north east side of the Plaza (adjacent to City Hall parking lot), or as one cohesive project on all of the lots. The PD requires that these lots be merged prior to conveyance to a private owner. Existing “Alley” Easement Page 34 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 b) Building designs may bridge the Plaza space when a minimum vertical clearance of 16 feet is maintained and a minimum Plaza width of 20 feet is maintained. When portions of buildings cover the Plaza, provisions for natural light, ample visibility, and unrestricted public/pedestrian access, shall be maintained. c) Building architecture shall complement, but not duplicate, City Hall. Designs that incorporate brick, extensive glazing, tile roofs, balconies, and opportunities to utilize outdoor spaces shall be strongly encouraged. d) Recessed building entries with a depth of at least six feet, transom windows, and glazing along East Mall that allows 60% visibility into the ground floor space shall be required. Glazing shall not be blocked by interior walls or panels. e) Encroachments that provide for outdoor dining shall be encouraged at Centennial Plaza and the public sidewalk while maintaining a minimum path of travel of 8 feet on the Plaza and 6 feet on public sidewalks. However, the width of the plaza shall remain at 20 feet, to be free from building encroachments, other than temporary outdoor dining installations, awnings, signs, lighting and related features. f) Fire Backflow Devices: Fire backflow devices are required to be integrated into the site or building design, are prohibited in any public right-of-way, and must be accessible to Fire Department and Water Company personnel at all times. g) Building Coverage: No limit. Each successive floor shall reduce interior floor space by 10%. h) Stormwater: No above ground stormwater retention may be allowed on-site in excess of 400 square feet over the entire Planned Development. i) Native Trees: Native trees that contribute to the tree canopy of Centennial Plaza, the parking lot, and the creek pathway should be preserved in place and protected during construction. Some native trees may need to be pruned or removed to accommodate appropriate site development. j) Public Restrooms: Public restrooms shall be provided to the public during open business hours in a location that is accessible from the ground floor Conclusion The purpose of this City-led effort to record a PD Overlay Zone on these sites is to guide and incentivize development that will help activate the Downtown Zoning District, close to the creek, the park and City Hall. The City intends to sell these sites to allow for private development. Following adoption and second reading of the PD ordinance, the City will commence the Surplus Land Act process, then enter a phase to advertise the sites and allow for applicants to submit proposals for purchase and development. Staff will provide an update to the City Council following the completion of the Surplus Land Act process. Findings to Support Approval To recommend approval of the proposed project, the City Council must make the following findings. These findings and the facts to support these findings are included in the attached Draft Ordinance. Planned Development Overlay Zone (AMC Section 9-3.644) A. Modification of development standards or processing requirements is warranted to promote orderly and harmonious development; Page 35 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 B. Modification of development standards or processing requirements will enhance the opportunity to best utilize special characteristics of an area and will have a beneficial effect on the area; C. Benefits derived from the Overlay Zone cannot be reasonably achieved through existing development standards or processing requirements; D. Proposed plans, if any, offer certain redeeming features to compensate for requested modifications. Standard Zoning Text Amendment Findings: 1. The proposed project or use is consistent with the General Plan; 2. The establishment, and subsequent operation or conduct of the use will not, because of the circumstances and conditions applied in the particular case, be detrimental to the health, safety, or welfare of the general public or persons residing or working in the neighborhood of the use, or be detrimental or injurious to property or improvements in the vicinity of the use; 3. The proposed project or use will not be inconsistent with the character of the immediate neighborhood or contrary to its orderly development; 4. The proposed zone change will not create any new significant and unavoidable impacts to traffic, infrastructure, or public service impacts; 5. The proposed zone change is consistent with the CEQA findings. ENVIRONMENTAL DETERMINATION: The California Environmental Quality Act (CEQA), Section 15061(3)(b), exempts activities which are covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. The proposed text amendment will not have any significant adverse environmental impacts. Any future development of the site would be exempt as infill development. The Overlay Zone change is not creating any added development potential other than what exists today and is anticipated by the 2002 General Plan. FISCAL IMPACT: None. Page 36 of 114 ITEM NUMBER: B-1 DATE: 04/26/22 ALTERNATIVES: 1. The City Council may modify the Planned Development language and/or any of the conditions of approval for a future project. Any proposed modifications of the PD language, should be clearly re-stated in any vote on any of the attached resolutions. 2. The City Council may determine that more information is needed on some aspect of the project and may refer the item back to Staff to develop the additional information. The Council should clearly state the type of information that is required. A motion, and approval of that motion, is required to continue the item to a future date. 3. The Council may deny the PD zoning amendment. The Council must specify what findings cannot be made, and provide a brief oral statement, based on the Staff Report, oral testimony, site visit, correspondence, or any other rationale introduced and deliberated by the City Council. ATTACHMENT: Draft Ordinance Page 37 of 114 ITEM NUMBER: B-1 DATE: ATTACHMENT: 04/26/22 1 DRAFT ORDINANCE AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ATASCADERO, CALIFORNIA, AMENDING TITLE 9 PLANNING & ZONING, SECTION 9-3, ARTICLE 26, ADDING SECTION 9-3.682 TO ADD A NEW PLANNED DEVELOPMENT OVERLAY ZONE NO. 37 FOR THE FIVE VACANT LOTS SURROUNDING CENTENNIAL PLAZA (LOTS 12- 17), AND DETERMINING THIS ORDINANCE IS EXEMPT FROM REVIEW UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (ZCH 22-0022) WHEREAS, the City of Atascadero is the applicant pursuing a zone change text amendment to Title 9 Zoning Ordinance, (ZCH22-0022) to add a new Planned Development Overlay Zone 37 for the five vacant lots surrounding Centennial Plaza and including Centennial Plaza (lots 12-17), based on findings and subject to the future approval of a Master Plan of Development; and WHEREAS, the Planning Commission has determined that it is in the best interest of the City to enact the planned development zoning amendments to Title 9 Planning and Zoning of the Atascadero Municipal Code for consistency with the General Plan and to maintain a clear and reasonable guidance for future downtown development that is easily interpreted by the public and staff; and WHEREAS, a timely and properly noticed Public Hearing upon the subject Planning and Zoning text change application was held by the Planning Commission of the City of Atascadero at which hearing evidence, oral and documentary, was admitted on behalf of said Planning and Zoning Text amendments; and WHEREAS, the Planning Commission of the City of Atascadero, at a Public Hearing held on March 15, 2022, studied and considered said amendments; and WHEREAS, the Planning Commission of the City of Atascadero has recommended approval of proposed amendments to Title 9 Zoning Ordinance, of the Atascadero Municipal Code as presented to them on March 1, 2022 and March 15, 2022; and WHEREAS, the laws and regulations relating to the preparation and public notice of environmental documents, as set forth in the State and local guidelines for implementation of the California Environmental Quality Act (CEQA) have been adhered to; and WHEREAS, a timely and properly noticed Public Hearing upon the subject Zoning Text Change application was held by the City Council of the City of Atascadero at which hearing evidence, oral and documentary, was admitted on behalf of said Zoning Text Amendments; and Page 38 of 114 ITEM NUMBER: B-1 DATE: ATTACHMENT: 04/26/22 1 WHEREAS, the City Council of the City of Atascadero, at a Public Hearing held on April 26, 2022, studied the Planning Commission’s recommendation and considered the proposed zoning text amendments. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF ATASCADERO HEREBY ORDAINS AS FOLLOWS: SECTION 1. Recitals: The above recitals are true and correct. SECTION 2. Public Hearing. The City Council of the City of Atascadero, in a regular session assembled on April 26, 2022, resolved to introduce for first reading, by title only, an Ordinance that would amend the City Zoning Code Text as shown in Exhibit A, attached hereto and incorporated herein by this reference. SECTION 3. Facts and Findings. The City Council makes the following findings, determinations and approvals with respect to the Zone Text Amendment: A. Findings for Approval of a Zone Text Change FINDING: (i) The Planning and Zoning Text Change is consistent with General Plan policies and all other applicable ordinances and policies of the City. FACT: The proposed zone text amendments align the code requirements with the vision, intent, and policies of the adopted General Plan. FINDING: (ii) This Amendment of the Zoning Ordinance will provide for the orderly and efficient use of lands where such development standards are applicable. FACT: The proposed text amendment provides for orderly development within the Downtown Commercial zoning district on lots 12 through 17 (APN 029-347-020) in accordance with the adopted General Plan for the compatible use of the properties based on neighborhood characteristics. FINDING: (iii) The Text Change will not, in itself, result in significant environmental impacts. FACT: The proposed text changes are minor and do not trigger any environmental impacts. SECTION 4. Approval. Atascadero Municipal Code Title 9 Planning & Zoning is amended, establishing Planned Development Overlay Zone No. 37, as detailed in Exhibit A, attached hereto and incorporated herein by this reference. SECTION 5. CEQA. This Ordinance is exempt from the California Environmental Quality Act (CEQA), Public resources Code Section 21000 et seq., because it can be seen with certainty that there is no possibility that the enactment of this Ordinance would have a significant effect on the environment (Pub. Resources Code § 21065; CEQA Guidelines §§ 15378(b)(4), 15061(b)(3). Page 39 of 114 ITEM NUMBER: B-1 DATE: ATTACHMENT: 04/26/22 1 SECTION 6. Interpretation. This Ordinance must be broadly construed in order to achieve the purposes stated in this Ordinance. It is the City Council’s intent that the provisions of this Ordinance be interpreted or implemented by the City and others in a manner that facilitates the purposes set forth in this Ordinance. SECTION 7. Preservation. Repeal of any provision of the AMC or of any previous Code Sections, does not affect any penalty, forfeiture, or liability incurred before, or preclude prosecution and imposition of penalties for any violation occurring before this Ordinance’s effective date. Any such repealed part will remain in full force and effect for sustaining action or prosecuting violations occurring before the effective date of this Ordinance. SECTION 8. Effect of Invalidation. If this entire Ordinance or its application is deemed invalid by a court of competent jurisdiction, any repeal or amendment of the AMC or other City Ordinance by this Ordinance will be rendered void and cause such previous AMC provision or other City Ordinance to remain in full force and effect for all purposes. SECTION 9. Severability. If any part of this Ordinance or its application is deemed invalid by a court of competent jurisdiction, the City Council intends that such invalidity will not affect the effectiveness of the remaining provisions or applications and, to this end, the provisions of this Ordinance are severable. SECTION 10. Certification. The City Clerk is directed to certify the passage and adoption of this Ordinance, cause it to be entered into the City of Atascadero’s book of original ordinances, make a note of the passage and adoption in the records of this meeting and within fifteen (15) days after the passage and adoption of this Ordinance, cause it to be published or posted in accordance with California law. SECTION 11. Effective Date. This Ordinance will take effect on the 30th day following its final passage and adoption. INTRODUCED at a regular meeting of the City Council held on _____, 2022 and PASSED, APPROVED and ADOPTED by the City Council of the City of Atascadero, State of California, on _____, 2022. CITY OF ATASCADERO, CA ______________________________ Heather Moreno, Mayor ATTEST: ______________________________ Lara K. Christensen, City Clerk APPROVED AS TO FORM: ______________________________ Brian A. Pierik, City Attorney Page 40 of 114 ITEM NUMBER: B-1 DATE: ATTACHMENT: 04/26/22 1A EXHIBIT A Zone Text Change – Planned Development Overlay No.3637 Text ZCH22-0022 9-3.681 Establishment of Planned Development Overlay No. 3637 Planned Development Overlay Zone No. 3637 is established as shown on the official zoning maps (Section 9-1.102 of this title). A Planned Development Overlay Zone No. 3637 is established on parcels APN’s 049-063-003, 004, 049-071-029, 030 (Parcels 1-4 of AT02-278). (A) All site development ormust be consistent with a City approved Master Plan of Development. A Master Plan of Development approved by the City shall be required prior to completion of conveyance of any site from the City to private ownership. All new development shall be consistent with a Master Plan of Development. The Master Plan of Development shall be reviewed by the DRC and shall consider the views and connectivity between City Hall, Sunken Gardens, the Centennial Plaza and bridge and Colony Square. Building and site designs shall preserve a view corridor to the pedestrian bridge as viewed from West Mall. Any significant building modifications, beyond following approval, including ADA or code required changes, to the site or exterior changes of any building, shall require Design Review Committee review. (B) The following uses are allowed within the PD-3637 overlay zone on the ground floor: 1. Artisan Foods and Products 2. Bar/Tavern 3. Eating and Drinking Places 4. General Retail* (with additional parameters - see below) 5. Microbrewery – Brewpub 6. Tasting Room 7. Winery – Boutique 8. Open space areas for passive outdoor use including walking, gathering, public entertainment, seating, and related, dedicated for use to the public *Additional Parameters for General Retail: * 1. Minimum operating hours (open to the public) shall be 4 days per week, 6 hours per day, and open until at least 7PM. 2. The following retail uses shall not be allowed: Building materials and hardware, medical supplies, office supplies, or other items that do not contribute to the synergy, pedestrian orientation and general plan consistency for the downtown. Page 41 of 114 ITEM NUMBER: B-1 DATE: ATTACHMENT: 04/26/22 1A (C) The following uses are allowed within the PD-3637 overlay zone above the ground floor: 1. All uses as allowed on ground floor list 2. Business Support Services 3. Live/Work Unit 4. Lodging/hotel/motel/vacation rental 5. Multifamily Dwelling 6. Personal Services 7. Offices (D) Property Development Standards 1. Front yard setback: at East Mall: 10-foot building setback shall be required for ground floor portions of the building, setback may be utilized for outdoor dining, awnings, second or third story building projections such as decks, patios or other floor area, signs, and other features designed to enhance the public space. No building setback shall be required at the rear side, facing Atascadero Creek. 2. Parking: No on-site parking shall be allowed. Parking required for residential uses shall be required at the rate of one space per two bedrooms (minimum one space per unit), to be located off-site within 1,000 feet of the property boundary and provided in perpetuity through an off-site parking agreement. No parking shall be required for retail and restaurant uses on the ground floor consistent with this PD. No parking shall be required for office, or transient lodging uses. 3. Height: 45 Feet, maximum of three stories, with each successive story a minimum of 10% reduced floor area from story below. Use of roof area permitted for outdoor uses/occupancy. Non-habitable roof projections such as elevator enclosures, parapet walls, roof forms, and other architectural features may extend above the maximum height up to 8 feet. (E) Site and Building Design 1. A single development project shall be completed on the north east side of the plaza, or as one cohesive project on all of the lots. North east side lots shall be merged prior to conveyance to private ownership. 2. Building designs may bridge the plaza space when a minimum vertical clearance of 16 feet is maintained and a minimum plaza width of 20 feet is maintained. When portions of buildings cover the plaza, provisions for natural light, ample visibility, and unrestricted public/pedestrian access, shall be maintained. Page 42 of 114 ITEM NUMBER: B-1 DATE: ATTACHMENT: 04/26/22 1A 3. Building architecture shall complement, but not duplicate, City Hall. Designs that incorporate brick, extensive glazing, tile roofs, balconies, and opportunities to utilize outdoor spaces shall be strongly encouraged. 4. Recessed building entries with a depth of at least six feet, transom windows, and glazing along East Mall that allows 60% visibility into the ground floor space shall be required. Glazing shall not be blocked by interior walls or panels. 5. Encroachments that provide for outdoor dining shall be encouraged at Centennial Plaza and the public sidewalk while maintaining a minimum path of travel of 8 feet on the plaza and 6 feet on public sidewalks. 6. Fire Backflow Devices. Fire backflow devices are required to be integrated into the site or building design, are prohibited in any public right-of-way, and must be accessible to Fire Department and Water Company personnel at all times. 7. Building coverage: No limit. Each successive floor shall reduce interior floor space by 10% to enhance building articulation and reduce building massing. 8. Stormwater: No above ground stormwater retention may be allowed on-site in excess of 400 square feet over the entire Planned Development. 9. Native Trees: No Heritage trees shall be impacted or removed by proposed development. Native trees that contribute to the tree canopy of Centennial plaza, the parking lot, and the creek pathway should be preserved in place and protected during construction as feasible. Some native trees may need to be pruned or removed to accommodate appropriate site development. The existing off-site Deodar Cedar shall be preserved and protected. Any tree removals shall be subject to the City’s Native Tree ordinance. 10. Public Restrooms: Public restrooms shall be provided to customersin one or more of the ground floor buildings within the PD. Restrooms shall be open to the public during open business hours in a location that is accessible from the ground floor. Page 43 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 Atascadero City Council Staff Report – Administrative Services Department Fiscal Update RECOMMENDATION: Council receive and file fiscal update. DISCUSSION: Background The City of Atascadero has worked hard to maintain fiscal stability through the ups and downs in the economy that have occurred over the years. It is the City’s goal to continue to be responsible and accountable stewards of the City’s resources now and into the future by efficiently and effectively investing in modern and reliable infrastructure and equipment and maintaining financial stability regardless of economic conditions. Analysis Following is a discussion of key data points that impact the City’s bottom line. The City is currently in the middle of a two-year budget cycle. The assumption developed and used for the current budget cycle were derived during the midst of the COVID-19 pandemic. The pandemic shut down the economy in ways that had never been experienced before, and there is no certainty that the forecasts in the budget and Seven-Year Projection are wholly accurate. Monitoring progress is more important than ever. Staff continues to analyze City revenues and expenditures and compare them with the budgeted assumptions to monitor performance and bring to Council any necessary adjustments. Through this analysis, staff believes the City’s finances are currently stable as economic recovery from COVID-19 continues. In addition, the City now has the new Sales Tax Measure D-20 Essential Service Tax revenue programmed in the current budget which is providing for many urgently-needed expenditures. Property Tax Revenue Property Tax revenue is the City’s largest single revenue source. The City’s 2021-2023 budget estimates that property tax revenue makes up about 39% of total General Fund Revenue (excluding Measure F-14 Funds). The tax is based on the underlying assessed value of the property, rather than on a fixed amount or benefit to the property or person. Page 44 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 The Council’s focus on economic development is helping over time to expand the taxable property base. For every $1 million that is added in new construction, $10,000 a year is paid to the County in property tax, and about $1,600-$1,800 of that comes back to Atascadero’s General Fund. The property taxes that are due in fiscal year 2021-22 were calculated based on valuations determined in January 2021. Because property tax revenue is based on the assessed value of property as of the beginning of each calendar year, it is a very stable revenue source and typically doesn’t lend itself to the more drastic fluctuations in the economy as other revenues sources. In December 2021, the State Board of Equalization announced that the California Consumer Price Index (CCPI) used by Counties to determine the increase in the assessment role was 5.561%. Accordingly, county assessors used the maximum inflation rate of 2% to increase the base valuation. In addition to inflation increases in the existing property value, construction of new properties add value to the tax roll and thus increase revenues as well. The County Assessor’s projections for fiscal year 2021-22 are fairly consistent with City budgeted revenue projections, as are the Assessor’s projected fiscal year 2022-23 increases of 4% in the Countywide Secured roll. City property tax revenues are projected to increase around 3% - 4% through fiscal year 2027-28. Property Taxes & RPTTF 39% Sales Tax 34%Other Taxes 10% Permits, Fees & Development 4% Charges for Services 5% Other Revenues 7% Intergovernmental 1% Average Major Revenue Sources 2021-2023 Page 45 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 Beacon Economics’ California Outlook Spring 22 forecasts that housing prices in the state will continue to rise throughout the end of the calendar year. The UCLA Anderson Forecast (March 9, 2022) predicts relatively rapid growth in home building in the state. The expectation for California is for 123,000 net new units to be granted permits in 2022, climbing to 151,000 by 2024. However, in their United States Outlook, Beacon Economics suggests that the economy is unsustainably overstimulated and will course-correct at some point. What that looks like is unknown at this time. Fortunately, the amenities of the California Central Coast that are appreciated by local residents are expected to help maintain value in the assessed roll in Atascadero. Additionally, the City is seeing the development of many of the economic “hot spots” that will not only increase the assessed roll, but also bring much needed head-of-household jobs to the community. This in turn is expected to help support the housing market. Sales Tax Revenue Historically, sales tax revenue averaged about 18% of General Fund revenue. This has changed due to the generosity of Atascadero voters who approved Sales Tax Measure D-20 in November of 2020. Fiscal year 2020-21 was the first year to reflect Sales Tax Measure D-20 revenue. The City’s 2021-23 budget estimates sales tax revenue, including Measure D-20, will average about 34% of total General Fund revenue. Sales tax is arguably the most volatile of the major revenues and is highly reactive to the local, state and national economies. The City has projected Bradley Burns Sales Tax revenue of about $4.5 million in 2021- 22 and about $5.2 million of Sales Tax Measure D-20 revenue in the same period. Based on current trends, HdL Companies (HdL), the City’s Sales Tax consultant, is projecting an additional 10% increase in revenue over the City’s seven-year forecasted revenue. $- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 $8,000,000 $9,000,000 $10,000,000 1997-19981998-19991999-20002000-20012001-20022002-20032003-20042004-20052005-20062006-20072007-20082008-20092009-20102010-20112011-20122012-20132013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-20232023-20242024-20252025-20262026-20272027-2028Property Taxes (Current Secured) Page 46 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 The following graph illustrates sales tax revenue projections as included in the 2021-2023 budget. This graph includes both Bradley Burns Sales Tax revenues, as well as Sales Tax Measure D-20 revenue. HdL analyzed state-wide sales tax trends and is projecting common economic influences across the difference tax generating groups including ongoing COVID pandemic impacts such as supply chain disruptions, manufacturing slowdowns and employment shortages. Further, their forecast incorporates higher labor and raw material costs, along with higher fuel prices and inflationary pressures that are expected drive taxable goods prices upward now and through the next fiscal year. Supply chain bottlenecks and labor shortages along with strong demand put downward pressure on supply, which in turn puts upward pressure on prices, and eventually, upward pressure on spending and sales tax revenue. $- $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 2021-2023 Budget Sales Tax Revenue Projections Page 47 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 Despite the higher interest rates, inflation and prices, HdL projects statewide trends of above average growth in sales tax revenue in 21/22, with a deceleration in 22/23 and 23/24, before returning to a more typical growth rate beginning in 24/25. Atascadero’s sales tax revenue will not necessarily follow the statewide trend, but it does provide useful information on general trends. Of Atascadero’s sales tax revenue, around 17% is due to sales from fuel and service stations. Strong, short-term gains are projected for fiscal year 21/22, followed by long- term annual projected growth of 2%. Page 48 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 For the period July – September 2021, the Building and Construction Industry made up about 16% of the City’s sales tax revenue. HdL projected this sector would continue relatively strong growth through March 2022, and will then flatten through March 2023, before it resumes a modest growth rate between 2%-5% out though fiscal year 26/27. Transient Occupancy Tax (TOT) Revenue Transient Occupancy Tax (TOT) are revenues collected from guests staying at lodging facilities within the City. This is a local revenue, with which the City has significantly more influence. Prior to COVID-19, the City had seen a sizable increase in TOT revenues with the Council’s emphasis on promotion and economic growth and the efforts of the Atascadero Tourism Business Improvement District. The increase in additional lodging facilities provides the potential for additional TOT revenue. During the 2021-2023 budget cycle, staff estimated that TOT revenues for fiscal year 2020-2021 would increase by 11% from fiscal year 2019-2020. Actual TOT revenues exceeded estimates for fiscal year 2020-2021 and saw an increase of 23.3% over the previous fiscal year. TOT is now the third largest source of General Fund revenue. Revenue for the first two quarters of fiscal year 21-22 is already at 77% of budgeted revenue for the year. TOT is expected to exceed revenue projections in fiscal year 2022. Cities across the state are seeing similar trends. For example, the City of Santa Barbara collected 86% of the budgeted revenue in the first 8 months of the fiscal year. City of Los Angeles is projecting a TOT revenue increase of 97%, and the City of San Diego, 26%. $- $500,000 $1,000,000 $1,500,000 $2,000,000 2021-2023 Budget Transient Occupancy Tax (TOT) Page 49 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 Expenses The City is a service organization and employee services are the backbone of the community. The largest portion of General Fund expenditures is dedicated to employee services. An average of 65% of General Fund expenditures for the two-year budget cycle were allocated directly toward the cost of employee services. Employee services includes not just salaries, wages and overtime, but also health insurance, retirement costs, and other expenses such as Medicare, unemployment insurance, workers’ compensation, and increases to minimum wage for part-time employees. The City has been able to stay within its limited financial constraints with the cooperation of its employees. While there are some differences in benefits packages between jurisdictions, the City has consistently been amongst the lowest total compensation for most positions at the City. While compensation is often not the only reason an employee chooses to work for an employer, when there are significant differences in pay, it is an important consideration. Because the cost of living is high in the area, and neighboring jurisdictions were able to pay more, the City’s low wages were often a barrier to attracting, hiring and most importantly, retaining professional employees. The has had a large effect on City operations as vacancies lead to even lower staffing levels, inefficiencies and additional incurred costs as new employees are trained. The Police Department, in particular, was experiencing exceptional difficulty in recruiting Police Officers and Public Safety Dispatchers. The nationwide negative attitude toward law enforcement in combination with Atascadero’s salary schedule being one of the lowest in the County made it difficult to recruit and retain Police Department personnel. The passage of Measure D-20 has provided much needed funding to support not only public safety, but citywide staff as well. New Memorandums of Understanding (MOUs) reflecting the updated salary schedule were negotiated with all labor groups and approved by Council. These MOUs were effective starting July 1, 2021. The portion of Measure D-20 funds allocated in this budget cycle to salary changes has been in an effort to bring those salaries more in line with other comparable agencies. The intention of this citywide salary change is to increase staff efficiencies, provide improved services to the public, and to reduce long-term costs by attracting and retaining qualified professional employees. Employee Services 65% Operations 25% Capital and Special Projects 10% Average Expenditures by Category 2021-2023 Page 50 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 In addition to the salary schedule changes, the 2021-23 budget allocated funds for new positions: • Five new police officers • One new public safety dispatcher • One Website/Social Media Technician • Confirmation of Battalion Chief from temporary two-year position to permanent, and permanent position for SAFER grant firefighter As a result of all the changes, the Police department has been able to fill most of their original eight officer vacancies and public safety dispatch positions. About 57% of the City’s General fund expenditures is devoted specifically to the Police and Fire departments. This includes the costs of each officer and fire fighter, their equipment, supplies, training and other costs. Along with increases in Employee Services, Measure D-20 funds allowed for increases in the operating budgets and Special and Capital Projects. Of the total Measure D-20 allocated in the 2021-23 budget, 79% went toward public safety (police, fire, and public works) in categories of employee services, operating budgets, equipment and vehicle purchases, and reserves for future equipment and vehicle purchases. General Government 13% Public Safety 57% Community Development10% Community Services 9%Public Works 11% Average Expenditures by Function 2021-2023 $- $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 Public Safety Infrastructure Other Focus Area Priorities 79% 8%13% Measure D-20 Funds 4/1/21 -6/30/23 Page 51 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 Council approved a balanced strategy for the use of Measure D-20 funds that balanced operational expenditures with one-time expenditures in order to accommodate future growth for Measure D-20 funds. CalPERS CalPERS retirement costs are another area staff has been closely monitoring. The ongoing “normal” costs of retirement and the CalPERS projected payments for the Unfunded Accrued Liabilities (UAL) are included in the City’s existing Seven-Year Projection, as found on Page B-11 in the 2021-2023 Budget Document. CalPERS reported a 21.3% return on investments for fiscal year ended June 30, 2021. This prompted a 0.2% reduction of the discount rate to 6.8% (which will affect Atascadero’s rates starting in fiscal year 2023-2024). This is due to Cal PERS’ Funding Risk Mitigation Policy, which states that a double-digit return will trigger a reduction in the discount rate used to calculate employer and PEPRA member contributions. 66% 34% Measure D-20 Expenditures by Category for Fiscal Year 2021-2023 One-time costs Ongoing costs Page 52 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 CalPERS reported the market value of the total fund was $477.3 billion as of 06/30/21. The funded status of the overall PERF was estimated to be 80% under the new discount rate of 6.8%, as of June 30, 2021. CalPERS has taken steps over the last few years to put the fund in a position to better weather a downturn, expecting that a downturn would eventually occur. CalPERS has implemented a plan to take advantage of downturns in the market as investment opportunities. City staff will continue to monitor CalPERS, the expected investment returns, and other factors that may have an impact on the City’s current and future budgets. Reserves The City’s overall financial strategy has consistently been to maintain a conservative outlook by putting aside reserves in good times and then using those reserves during down periods to achieve stable operations. By employing this conservative strategy, the City can avoid the undesirable peaks and valleys in services due to revenue fluctuations and can better maintain its long- term financial vitality. The Council’s Financial Strategy has been effective at building a General Fund Reserve. As of June 30, 2021, the General Fund (excluding Sales Tax Measure F-14 funds) had an available fund balance of $12.8 million, or 48% of the General Fund Page 53 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 Expenses. The 2021-2023 budget cycle includes the use of just over $2.6 million in reserves for the two-year period in order to maintain a consistent level of City services. The Seven-Year Projection in the 2021-2023 budget shows projects that starting in fiscal year 2023-2024, those reserves will begin to rebuild. Conclusion COVID-19 and the resulting Great Shutdown upset the economy both locally and throughout the world. The good news is that the City Council Financial Strategy put the City in a good position to be able to maintain consistent services throughout this downturn, and provided a financial cushion to buy some time before making any decisions that could really impact the City. Some sectors of the economy continue to be impacted by COVID- 19, as others have improved or even exceeded pre-pandemic levels. The length of time that the economy will be impacted by COVID-19 is unknown, but the City’s Financial Strategy is designed to insulate the City from such economic instability. The bigger financial picture is the state of the City’s ongoing operations. The City runs a tight budget and does the best possible with the limited resources. Measure D-20 revenue is providing for many critical expenditures that are needed to continue to provide first rate service to the community. Staff continues to look for opportunities for grants and efficiencies, and is monitoring the economic trends and local impacts in order to maintain the upmost financial health for the City. $(500,000) $500,000 $1,500,000 $2,500,000 $3,500,000 $4,500,000 $5,500,000 $6,500,000 $7,500,000 $8,500,000 $9,500,000 $10,500,000 $11,500,000 $12,500,000 $13,500,000 General Fund Available Balance in Dollars Page 54 of 114 ITEM NUMBER: C-1 DATE: 04/26/22 FISCAL IMPACT: None. ATTACHMENTS: 1. The Beacon Outlook- California, Spring 2022 2. The Beacon Outlook- United States, Spring 2022 3. HdL Companies- California Forecast, Sales Tax Trends and Economic Drivers, December 2021 4. UCLA Anderson Forecast- The California Report: Delta, Migration and Relative Affordability, December 2021 Page 55 of 114 1 | THE BEACON OUTLOOK - CALIFORNIASpring 2022 Taner Osman PhD, Research Manager HIGHLIGHTS INLAND RENT SPIKE In coastal California, rent has increased by approximately 3% since the first quarter of 2021. At the same time, rent in inland communities has surged by 16%. This is likely being driven by the ability of workers to work remotely during the pandemic and, therefore, move to more affordable markets, increasing demand significantly. As people return to their places of work, it will place upward pressure on coastal rents in 2022. STATE GDP RETURNS TO PRE-PANDEMIC TREND California’s GDP has effectively returned to its pre-pandemic trend, marking a complete recovery in that metric. In 2022, GDP could push even higher than trend but only in the short term. The state’s output should return to its long-run average as the wealth buildup that occurred throughout the pandemic diminishes. CALIFORNIA JOBS RECOVERY STILL TRAILS Having regained just 72% of the jobs lost at the onset of the pandemic, California continues to lag the nation in its employment recovery. As of December of last year, there were still 768,600 fewer people employed in the state compared to February 2020. However, in 2021, California added jobs at a faster rate, and because the state has more room to grow, that better performance should continue in 2022 and converge to the national trend. CALIFORNIATHE BEACON OUTLOOK ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 56 of 114 2 | THE BEACON OUTLOOK - CALIFORNIAKEY INDICATORS California Median Home Price Housing scarcity has pushed median home prices in the state above $650,000, double the national figure. The specter of higher interest rates will weigh on price appreciation in 2022. Share of California Residents Who Are Vaccinated With high vaccination rates and in the absence of another variant or resurgence, the state’s health mandates are beginning to disappear quickly. This, hopefully, is the beginning of the end of a tumultuous two-year period in California’s history. Nominal Wage Increase (well, sort of) As labor shortages persist, wages have risen in California. Nominal wages grew by 5% in 2021… but there’s a twist. Real wages in the state barely increased during the year, offset by record inflation. 5% 70% $650,000+ ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 57 of 114 3 | THE BEACON OUTLOOK - CALIFORNIACALIFORNIA FORECAST - KEY INDICATORS Home Prices ($, SA) Real GDP (Millions 2012$, SAAR) Nonfarm Payrolls (000s, SA) Unemployment Rate(%, SA) Home Prices ($, SA) Real GDP (Millions 2012$, SAAR) Nonfarm Payrolls (000s, SA) Unemployment Rate(%, SA) 657,460 2,916,993 16,841 6.9 Current Q4-21 665,778 2,931,586 17,112 7 695,575 3,052,746 17,761 6 681,091 3,000,130 17,497 6 709,575 3,100,486 17,898 6 673,545 2,969,461 17,326 7 702,617 3,076,074 17,841 6 688,411 3,024,683 17,654 6 716,473 3,124,987 17,934 6 723,336 3,149,161 17,960 6 Forecast Q2-22F Q2-23F Q1-22F Q1-23F Q3-22F Q3-23F Q4-22F Q4-23F Q1-24F Source: U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics, CoreLogic; Forecast by Beacon Economics CALIFORNIA FORECAST THE BEGINNING OF THE END With more than 70% of the state’s residents fully vaccinated, and with COVID-19 hospitalizations having fallen precipitously, on February 16th, California announced plans to lift mask mandates in many indoor venues. In the absence of a resurgence, the public health mandates put in place to halt the spread of the virus are beginning to disappear quickly. This, hopefully, is the beginning of the end of a tumultuous two-year period in California’s history, marked by tens of thousands of virus-related deaths, great strain on the state’s healthcare infrastructure, as well as transformations in venues ranging across education, leisure, and work. Amidst this turmoil, California’s economy has, in many areas, fully recovered from the sudden and dramatic fallout of the pandemic, and some parts of the economy have even exceeded their pre-pandemic trend. This growth has been fueled in part by unprecedented fiscal and monetary stimulus, as well as the unique attributes of the recession (discussed further in the United States outlook). Today, the challenges facing California’s economy are very much the same as they were prior to the pandemic. In fact, the pandemic has acted as an accelerant to these long-standing issues. Housing scarcity has pushed median home prices in the state above $650,000, double the national figure, and the contraction of California’s labor force during the pandemic has exacerbated ongoing labor shortages. Interesting questions also surround the extent to which responses to the pandemic – such as the greater tendency for workers to work from home and spikes in non-coastal rental markets – will endure. ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 58 of 114 4 | THE BEACON OUTLOOK - CALIFORNIARECOVERED: CALIFORNIA’S OUTPUT While California’s output dropped 9% at the outset of the pandemic, as mandates restricting business activity and fear of catching the virus curtailed consumer activity, output in the state was 3% higher in the third quarter of 2021 compared to the first quarter of 2020. California’s GDP has effectively returned to its pre-pandemic trend, marking a complete recovery in that metric. In 2022, the state’s GDP could push slightly above its pre-pandemic trend, but will soon return to its longer-term average as the excess in savings induced by the pandemic is depleted. CALIFORNIA GROSS DOMESTIC PRODUCT, 2010-2021 3500 1500 2500 500 3000 1000 2000 0 Q1-10Q1-14Q1-12Q1-16Q1-18Q1-20Q1-11Q1-15Q1-13Q1-17Q1-19Q1-21Q3-10Q3-14Q3-12Q3-16Q3-18Q3-20Q3-11Q3-15Q3-13Q3-17Q3-19Q3-21Source: U.S. Bureau of Economic Analsyis; Analysis by Beacon Economics Real Gross Domestic Product: All Industry Total in California Pre-Pandemic Trend ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 59 of 114 5 | THE BEACON OUTLOOK - CALIFORNIALAGGING: EMPLOYMENT AND UNEMPLOYMENT California’s recovery in total jobs as well as its unemployment rate continue to lag the nation. As of December 2021, the state had recovered just 72% of the jobs lost in March and April 2020, and there were still 768,600 fewer people employed in California compared to February 2020, the onset of the pandemic. Overall, total nonfarm employment in the state has contracted 4.4% since that time compared to a 2.3% drop nationally. However, during 2021, California added jobs at a faster rate than the national economy. Payrolls in the state expanded 6% from December 2020 to December 2021, well above the 4.5% increase in the nation over the same period. California’s outperformance last year should continue in 2022. Quite simply, there is more room to grow in the state than there is nationally, so employment in California should continue to converge to the national trend. Remarkably, since February 2020, only two sectors have gained jobs in the state: Transportation, Warehousing, and Utilities and Professional, Scientific, and Technical Services. Two of the biggest laggards, Leisure and Hospitality and Other Services, which includes hair and nail salons, should drive employment growth throughout the remainder of this year, as in-person activity continues its return to normalcy. INDUSTRY EMPLOYMENT CHANGE, FEBRUARY 2020 – DECEMBER 2021 Industry Dec-21 Change Since Feb-20 (#) Change Since Feb-20 (%) Total Nonfarm Transportation,Warehousing & Utilities Professional,Scientific & Technical Services Educational & Health Services Finance & Insurance Construction Information Administrative & Support & Waste Services Manufacturing Retail Trade Management of Companies & Enterprises Wholesale Trade Government Real Estate & Rental & Leasing Other Services Leisure & Hospitality Mining and Logging 16,892,300 798,400 1,410,400 2,823,600 531,200 891,000 563,600 1,123,100 1,274,700 1,574,400 242,400 651,500 2,454,200 283,300 508,800 1,742,900 18,800 -768,600 66,200 52,300 -38,900 -11,600 -22,300 -17,500 -35,700 -53,100 -74,100 -12,000 -34,800 -161,100 -22,700 -84,500 -315,300 -3,500 -4.4 9.0 3.9 -1.4 -2.1 -2.4 -3.0 -3.1 -4.0 -4.5 -4.7 -5.1 -6.2 -7.4 -14.2 -15.3 -15.7 Source: California Employment Development Department; Analysis by Beacon Economics ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 60 of 114 6 | THE BEACON OUTLOOK - CALIFORNIACalifornia’s unemployment rate fell to 6.5% in December, elevated relative to the 3.9% rate in the United States overall. The state’s higher unemployment rate is primarily due to the underperformance of California’s labor market, relative to the national picture. Since February 2020, the state’s labor force has contracted by 358,100 workers, a 1.8% decline. However, higher wages should draw workers back into the labor force, and there is already some evidence of this. Nominal wages in California were up 5% in 2021 as employers paid more in their search for relatively scarce workers. However, real wages in the state barely rose during the year due to inflation. Source: California Employment Development Department; Analysis by Beacon Economics CALIFORNIA UNEMPLOYMENT RATE, 2012-2021 16 8 12 4 14 6 10 2 0 Q1-14Q1-12Q1-16Q1-18Q1-20Q1-15Q1-13Q1-17Q1-19Q1-21Q3-14Q3-12Q3-16Q3-18Q3-20Q3-15Q3-13Q3-17Q3-19Q3-21ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 61 of 114 7 | THE BEACON OUTLOOK - CALIFORNIACALIFORNIA AVERAGE WAGE, ANNUAL CHANGE Industry Q2-21 Year Over Year Change (%) Total Nonfarm Finance & Insurance Leisure & Hospitality Information Manufacturing Transportation,Warehousing & Utilities Professional,Scientific & Technical Services Management of Companies & Enterprises Real Estate & Rental & Leasing Retail Trade Wholesale Trade Health Care & Social Assistance Construction Administrative & Support & Waste Services Government Mining and Logging Other Services Educational Services 85,265 183,470 39,147 246,387 121,299 77,633 149,740 163,136 83,543 45,838 92,384 59,151 78,684 54,504 80,244 42,714 48,723 64,035 7.2 27.8 19.4 13.9 12.5 11.3 10.6 10.5 10.3 9.0 8.5 7.2 6.5 5.4 2.3 2.3 -0.8 -1.5 Source: Quarterly Census of Employment and Wages, U.S. Bureau of Labor Statistics ; Analysis by Beacon Economics ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 62 of 114 8 | THE BEACON OUTLOOK - CALIFORNIAHOUSING MARKETS STILL ON FIRE California’s housing market continued to see considerable strength in 2021, with median home prices growing 20% over the year, fueled by healthy consumers, low inventory, and low mortgage rates. This rate of price growth was double the already lofty 9% growth rate in 2020. While housing supply remains constrained in the state, the specter of higher interest rates will weigh on price appreciation in 2022. Source: CoreLogic; Analysis by Beacon Economics Source: California Association of Realtors; Analysis by Beacon Economics CALIFORNIA HOME PRICES, 2011-2021 HOUSING INVENTORY IN CALIFORNIA, 2017-2021 700,000 5.0 1.0 4.0 3.0 2.0 300,000 500,000 100,000 600,000 4.5 0.5 0.0 3.5 2.5 1.5 200,000 400,000 0 Q4-11Jan-17Jan-19Jan-18Jan-20Jan-21Sep-17Sep-19Sep-18Sep-20Sep-21Mar-17Mar-19Mar-18Mar-20Mar-21Nov-17Nov-19Nov-18Nov-20Nov-21May-17May-19May-18May-20May-21Jul-17Jul-19Jul-18Jul-20Jul-21Q4-19Q4-15Q4-13Q4-21Q4-17Q4-12Q4-20Q4-16Q4-14Q4-18Q2-12Q2-20Q2-16Q2-14Q2-18Q2-13Q2-21Q2-17Q2-15Q2-19Dollars (SA)ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 63 of 114 9 | THE BEACON OUTLOOK - CALIFORNIA In rental markets, an interesting dichotomhy has emerged between coastal and inland apartment rents. While rents in coastal communities fell at the outset of the pandemic, inland rents increased. Coastal rents have fully recovered since the pandemic lows, and have increased by around 3% since the first quarter of 2021. Over the same period, apartment rents in inland communities have increased by 16%. The spike in inland rents is likely being driven by the ability of workers to work remotely during the pandemic and therefore move to more affordable markets. Limited inventory in these markets has led to significant price increases. As workers return to offices, this should place upward pressure on coastal rents in 2022. Overall, 2022 should represent a continued return to normality along many social and economic dimensions in California, from housing to labor markets to business and consumer behavior. Source: REIS; Analysis by Beacon Economics CALIFORNIA APARTMENT RENTS, COASTAL VS. INLAND, 2020-2021 120 95 110 115 100 105 90 Q1-20 Q1-21Q3-20 Q3-21Q2-20 Q2-21Q4-20 Q4-21Indexed (Index = 100 in Q1-20)Coastal Inland ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 1 Page 64 of 114 1 | THE BEACON OUTLOOK - UNITED STATESSpring 2022 Christopher Thornberg PhD, Founding Partner HIGHLIGHTS SHOCKING FEDERAL DEBT The nation’s Federal debt is piling up at a shocking pace—growing to over $8.4 trillion in the last five years, $5.5 trillion in just the last two. This represents a 60% increase. At the same time, the debt-to-GDP ratio has increased from 94% to almost 120%, a rate of expansion that would lead to credit downgrades if it were a private company. And with even more spending increases in pending Federal budget acts, and no move to increase taxes, the nation’s structural deficit is likely to approach or exceed $1.2 trillion next year. The so-called twin deficits come to 4% of GDP, which is a big warning sign for an economy. The only other time the United States ran deficits at this level or higher was during the runup to the Great Recession. UNSUSTAINABLY OVERSTIMULATED Monetary and fiscal stimulus certainly played a role in the U.S. economy’s strong recovery from the pandemic-driven recession, but the scale of the intervention was vastly more than what was needed. Much of the excess stimulus passed straight through to the financial sector partly because consumers were unable to spend as much under COVID related restrictions on activity. Checking account balances have soared, as have cash reserves in the business sector. The desire to earn returns on this excess cash is driving a bubble – from the stock market to real estate to venture capital to cryptocurrencies. The fundamentals, ranging from cap-rates to P/E ratios to the sheer quantity of VC funding, are unsustainable. At some point, there will have to be an adjustment—how painful depends on how warped the fundamentals become in the months, and possibly years, ahead. CONSUMER DEMAND DRIVING RECORD INFLATION Pent-up consumer demand is at the core of the highest pace of inflation in the United States in 40 years, currently 7% and likely to climb even higher in the coming months. While there are certainly families and individuals being hurt by today’s inflation, the average American household is clearly on a spending binge. Overall consumer spending has been growing faster than U.S. GDP for 5 years running—with no slowing in sight. This may feel good in the short term, but consumption will have to fall back in line with output. Historically, periods where consumer spending exceeds output have always had ugly endings. UNITED STATESTHE BEACON OUTLOOK ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 65 of 114 2 | THE BEACON OUTLOOK - UNITED STATESKEY INDICATORS U.S. Real Economic Growth Real economic growth in the United States measured 3.1% from the 4th quarter of 2019 to the 4th quarter of 2021. This doesn’t stand out globally despite the massive amount of stimulus the Federal government injected into the economy. Other developed nations followed similar trajectories. Build Up In U.S. Wealth According to data from the Federal Reserve’s Flow of Funds, U.S. households were $30 trillion richer at the end of 2021 than they were just two short years earlier. This surge in wealth would typically drive even greater increases in spending, but that’s being stymied by supply chain problems and labor shortages. Energy Price Surge While global gas and other energy prices have soared, the degree of concern over how prices will affect U.S. consumers is misplaced in the aggregate. Once we account for overall inflation, a real price index of gasoline through January 2022 shows prices were still 30% lower than they were throughout all of 2012. GDP Final Demand GDP Trend $16,000B $17,500B $19,000B $20,500B $22,000B Q1-21Q1-20Q1-19Q1-18Q1-17Q1-16Q1-15Q1-14Final Demand Trend US REAL GDP AND FINAL DEMAND Source: U.S. Bureau of Economic Analysis; Analysis by Beacon EconomicsBillions of Chained 2012 Dollars (SAAR)ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 66 of 114 3 | THE BEACON OUTLOOK - UNITED STATES3% 6% 9% 12% 15%Q1-22Q1-17Q1-12Q1-07Q1-02Q1-97Q1-92Q1-87Q1-82U.S. UNEMPLOYMENT RATE Source: US Bureau of Labor Statistics; Analysis by Beacon EconomicsUnemployment Rate-3% 0% 3% 6% 9% 12% 15%Q1-21Q1-16Q1-11Q1-06Q1-01Q1-96Q1-91Q1-86Q1-81Q1-76Q1-71Q1-66$-10,000B $-5,000B $0B $5,000B $10,000B $15,000B $20,000B $25,000B $30,000B $35,000B Inflation 2 Year Change Household Net Worth CHANGE IN U.S. HOUSEHOLD NET WORTH VS INFLATION, 1965–2021 Source: Board of Governors of the Federal Reserve System, U.S. Bureau of Labor Statistics; Analysis by Beacon Economics Inflation PercentBillions of DollarsITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 67 of 114 4 | THE BEACON OUTLOOK - UNITED STATESInflation 10 Year Yield 1 Year Yield -2% 0% 2% 4% 6% 8% 10% 12%Q1-22Q1-17Q1-12Q1-07Q1-02Q1-97Q1-92Q1-87Percent YeildU.S. INFLATION AND TREASURY YIELDS, 1965–2021 Source: Board of Governors of the Federal Reserve System, U.S. Bureau of Labor Statistics; Analysis by Beacon Economics ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 68 of 114 5 | THE BEACON OUTLOOK - UNITED STATESUNITED STATES FORECAST U.S. FORECAST - OUTPUT Real GDP (Billions, 2012$) Real GDP (% Change from Preceding Period, SAAR) Consumer Spending (Billions, 2012$) Consumer Spending (% Change from Preceding Period, SAAR) Nonresidential Investment Structures (Billions, 2012$) Structures (% Change from Preceding Period, SAAR) Equipment (Billions, 2012$) Equipment (% Change from Preceding Period, SAAR) Intellectual Property Products (Billions, 2012$) Intellectual Property Products (% Change from Preceding Period, SAAR) Residential Investment (Billions, 2012$) Residential Investment (% Change from Preceding Period, SAAR) Inventory Accumulation (Billions, 2012$) Exports (Billions, 2012$) Exports (% Change from Preceding Period, SAAR) Imports (Billions, 2012$) Imports (% Change from Preceding Period, SAAR) Government Spending (Billions, 2012$) Government Spending (% Change from Preceding Period, SAAR) 5,042.1 6.4% 3,540.2 7.2% 172.9 -1.2% 346.9 10.4% 306.6 10.8% 172.9 -1.2% 25.1 623.5 13.6% 958.1 8.0% 846.5 2.0% 4,964.9 1.1% 3,479.2 2.2% 173.4 0.5% 338.4 13.9% 298.8 5.9% 173.4 0.5% 27.4 603.9 2.5% 939.8 2.2% 842.2 1.5% 4,951.5 6.9% 3,460.7 3.3% 173.2 -0.8% 327.6 0.8% 294.6 10.6% 173.2 -0.8% 43.4 600.2 24.5% 934.7 17.7% 839.2 -2.9% 5,173.7 10.9% 3,651.4 13.2% 172.7 -0.5% 359.9 15.9% 319.3 17.5% 172.7 -0.5% 26.6 638.2 9.8% 985.8 12.1% 850.5 1.9% 5,233.7 4.7% 3,691.6 4.5% 172.2 -1.2% 372.3 14.5% 329.6 13.6% 172.2 -1.2% 35.6 646.9 5.6% 1,012.7 11.4% 854.1 1.7% ForecastCurrent Q2-22FQ1-22FQ4-21 Q3-22F Q4-22F Source: U.S. Bureau of Economic Analysis; Forecast by Beacon Economics ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 69 of 114 6 | THE BEACON OUTLOOK - UNITED STATESU.S. FORECAST - KEY INDICATORS U.S. FORECAST - INFLATION Nonfarm Payrolls (Quarterly Change, 000s) Civilian Unemployment Rate (%) Industrial Production (Index) PCE Price Index (% Change, Year-Over-Year) Consumer Price Index (% Change, Year-Over-Year) 1,952 4.2 101.7 7.0 6.7 1,183 3.8 105.2 7.8 7.8 1,390 4.0 103.7 8.1 8.1 1,414 3.3 107.3 7.3 7.3 1,197 2.9 109.0 6.8 6.8 ForecastCurrent Current Q4-21 Q4-21 Source: U.S. Bureau of Economic Analysis, California Employment Development Department, U.S. Census Bureau; Forecast by Beacon Economics Source: U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics; Forecast by Beacon Economics Q2-22FQ1-22F Q3-22F Q4-22F Forecast Q2-22FQ1-22F Q3-22F Q4-22F ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 70 of 114 7 | THE BEACON OUTLOOK - UNITED STATESTHE ECONOMIC IMPACT OF RUSSIA’S INVASION OF UKRAINE As if all this uncertainty wasn’t enough, Russia’s decision to invade Ukraine has sent shock waves through global markets. From an economic perspective, it’s hard to see how Russia will come out ahead from this unprovoked attack on a sovereign nation and the horrors being inflicted on a civilian population. But then the actions of political leaders—particularly autocrats—are driven by any number of considerations, only one of which is economic. As such we’ll leave the geopolitical analysis to the Henry Kissinger’s of the world. What does this invasion mean for the U.S. economy? The short answer is not that much. While home to over 44 million residents, Ukraine is a small economy still trying to emerge from the shadow of communism. Its exports flow mainly to other European nations and are largely low tech manufactures that can easily be purchased from other countries. Russia is, of course, more formidable with the sixth largest economy in the world on a PPP basis, but it is not a highly developed economy. Its per capita output is just half of Germany’s, and it plays little role in global supply chains. Its exports are dominated by resource exports, oil and gas being the largest, and again, the United States is not a major buyer. To date, the biggest economic impact of the invasion has been on global energy markets where oil prices have shot up to close to $100 per barrel. This may be one reason why Vladimir Putin feels his nation can weather being an international pariah— after all Russia stands to gain at some level from the surge in energy prices that his actions have caused. Moreover, Europe’s dependence on natural gas has led to the bizarre situation where heavy sanctions are being leveled on most parts of the Russian economy, except this critical export. It remains to be seen if the West will eventually cut off this vital source of foreign currency despite the impact it could have on the energy dependent EU states. The increase in global energy prices, and the potential inflationary impact that could have on U.S. consumers, is the primary economic concern within the United States with regard to the attack. But such concerns are largely misplaced in the aggregate. First, the price of gasoline, the most direct impact on consumers, is not that high today once we account for overall inflation. A real price index of gasoline through January 2022 shows prices were still 30% lower than they were throughout all of 2012. ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 71 of 114 8 | THE BEACON OUTLOOK - UNITED STATESSecond, and more importantly, many consumers in the United States are far less sensitive to the price of gasoline than they used to be due to the broad range of fuel-efficient vehicles, the ability to easily have products delivered, and the current trend among many workers of working from home, which has reduced the costs of commuting. Energy prices are not the real issue. Inflation is affecting a wide variety of consumer spending categories. Unfortunately, blaming inflation on commodity markets is an effective way to distract consumers from the real sources of the problem – excessive demand driven largely by too much stimulus. 0 50 100 150 200 Q1-22Q1-12Q1-02Q1-92Q1-82Q1-72U.S. GASOLINE – INDEXED REAL PRICE Source: FRED; Analysis by Beacon EconomicsIndexed Real PriceITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 72 of 114 9 | THE BEACON OUTLOOK - UNITED STATES PRICE INDEXES, U.S. PERSONAL CONSUMPTION EXPENDITURES BY PRODUCT TYPE (SA) Q4-18 : Q4-19 Q4-20 : Q4-21 Personal consumption expenditures (PCE)1.7%5.5% Gasoline and other energy goods 2.7%48.6% Motor vehicles and parts 0.2%20.3% Furnishings and durable household equipment -0.7%7.6% Transportation services 0.8%7.2% Food services and accommodations 2.2%5.8% Food and beverages purchased for off-premises consumption 1.0%5.3% Clothing and footwear -1.7%4.8% Recreation services 2.2%4.4% Housing and utilities 3.0%4.0% Financial services and insurance 3.9%3.6% Other durable goods -1.1%3.2% Recreational goods and vehicles -5.3%2.9% Other services 1.6%2.7% Health care 2.0%2.5% Other nondurable goods 1.4%1.6% Source: U.S Bureau of Economic Analysis; Analysis by Beacon Economics Copyright ©2021 by Beacon Economics, LLCwww.BeaconEcon.com ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 2 Page 73 of 114 Delivering Revenue, Insight and Efficiency to Local Government Since 1983 HdL provides relevant information and analyses on the economic forces affecting California’s local government agencies. In addition, HdL’s Revenue Enhancement and Economic Development Services help clients to maximize revenues. 888.861.0220 | solutions@hdlcompanies.com | hdlcompanies.com CALIFORNIA FORECASTSALES TAX TRENDS & ECONOMIC DRIVERS DECEMBER 2021 ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 3 Page 74 of 114 STATEWIDESALES TAX TRENDS 2021/22 | 2022/232021/22 | 2022/23 Overview: Common economic influences across the following tax generating groups include ongoing COVID pandemic impacts such as supply chain disruptions, manufacturing slowdowns and employment shortages. Further, our forecast incorporates higher labor and raw material costs along with inflationary pressures that drive taxable goods prices upward now and through the next fiscal year. Fuel/Service Stations 30.3% | 2.0% Demand for all fuels is much higher than one year ago. The average price of a gallon of gas reached a record level of $4.75 per gallon as of November 2021. Diesel and jet fuel rates are reaching peak levels. More people are hitting the road to work, shop and take vacations. HdL is not anticipating a significant negative impact on the future consumption of fuel. As a result of these positive factors, strong, short-term gains are projected over the next three quarters, specifically, 50% in 4Q21, 20% in 1Q22, and 7% in 2Q22 followed by long-term annual escalations of 2%. General Consumer Goods 11.5% | 1.8% Retailers throughout California are reporting strong sales figures into the second half of 2021. Concerns related to COVID case rates do not seem to be impacting consumer’s ability and willingness to spend at retail establishments. Short-term expectations remain elevated, driven by higher customer charges and solid household fundamentals. The outlook for place-of-sale transactions should be subdued as behavior and technology shift more to e-commerce. Merchandise price points begin to affect demand in 2022. The cost of taxable goods is expected to rise faster than sales. Tax receipts could revert to the conventional growth rates of 1-2%. Restaurants/Hotels 32.9% | 5.2% When measured against 2019’s same period, 2021 third quarter overall collections rose 0.5%. Increased menu prices, the resumption of inbound international tourists and an uptick in business travel will keep the growth rate high for 2021/22. Recent results from hotels and entertainment venues demonstrate consumer desire to travel and spend more. Quick-service and casual dining establishments are the dominant tax-producing segments, and this won’t change anytime soon. Looking ahead, rates of growth will likely vary significantly by region. State and County Pools 4.6% | 6.5% 2021 year-to-date collections reflected that 42% came from marketplace facilitators and general retailers, another third from business-industry companies and 11% from vehicle acquisitions (primarily private-party sales processed through the DMV). These ratios should not alter much going forward and are inclusive of taxes reallocated to fulfillment centers. Aligned with recent national trends, the rate of e-commerce growth has slowed. Sellers of all kinds have boosted prices to address economic challenges. Forecasts going forward will capture percentage gains that pattern historical trends. Proposition 172 projections vary from statewide Bradley-Burns calculations due to the state’s utilization of differing collection periods in its allocations to counties. HdL forecasts a statewide increase of 12.3% for Fiscal Year 2021/22 and 3.1% for 2022/2023. Autos/Transportation 7.7% | 4.1% A strong demand dynamic boosted the cost of new cars by 10% and used cars by 26%. Consumers with money traded up, buying more expensive luxury brands. The higher per vehicle amounts more than offset the reported 13% third quarter drop in U.S. manufacturer new vehicle volumes. It is quite a contrast to a 15.6% jump in overall taxable receipts. Available inventory, while still expected to be constrained through 2022, is loosening slightly. Tax revenue from this category should exceed its long- term trend rate of growth in the year ahead. Building/Construction 5.4% | 0.5% Lumber prices slumped between late May and August but shot up again in September due to commodity availability issues. Retailers are trying to absorb these costs as contractors are already passing along these surges to project owners. Prices should remain high through mid-2022. Third quarter construction values reported a 14% drop. Fourth quarter permit activity shows office development is picking up while Bay Area construction starts are growing. Prior wildfire damage is being addressed by short-term repairs and recent heavy rains should intensify demand for needed materials. This forecast retains a 2022 flattening of tax generation followed by moderate growth thereafter. Business/Industry 10.9% | 3.5% Fulfillment centers heavily influenced third quarter growth through online sales and the continued shift of taxes from countywide pools to agencies with these in-state facilities. Medical/biotech increased by purchases of medical equipment, pharmaceuticals and investment in research and development. Business-to-business witnessed big gains as companies adapted to new ways of doing work. The state still struggles with pandemic-related challenges such as raw material and qualified worker shortages, but new orders and increased production pushed industrial-related receipts higher by 12%. In totality, this group is hitting pre-pandemic tax levels. Food/Drugs 1.7% | 2.0% Results from the third quarter noted a modest 1% improvement. Cannabis firms declined slightly. Consumers are increasingly savvier about how to shop for groceries and medicine as many turned to app-based solutions. This trend should continue for the foreseeable future. Investment in digitized solutions, low-cost delivery options and inventory optimization could help merchants try to hold the bottom line, offsetting price pressures brought about by greater employee compensation outlays and markedly greater cost of goods. TOTAL 10.8% | 3.5%2021/22 | 2022/23 HdL Companies Consensus Forecast December 2021 ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 3 Page 75 of 114 NATIONAL AND STATEWIDEECONOMIC DRIVERS U.S. Real GDP Growth 3.0% | 2.0% The real U.S. GDP growth rate in the 3rd quarter came in at 2.1% (seasonally adjusted annualized). In a normal year, this would be applauded as a solid growth trend. In the wake of the pandemic recession, these metrics have disappointed some economists and analysts – and set off calls to continue, or at least slow the reduction of, various Federal government stimulus programs. These reactions are based on a simplistic vision of what an economic “recovery” is. When considered more fully, it’s clear that not only has the U.S. economy recovered from the effects of the pandemic but looks like it’s becoming dangerously overheated. Beacon believes it is time to withdraw public stimulative efforts to prevent more harm than good to the next economic expansion. After the snap back from the depths of the recession, GDP growth will normalize over the next two years. CA Residential Building Permits 120,665 | 125,170 As of October 2021, there was 1.8 months’ worth of housing inventory available on the market in California. Inventory refers to the number of months it would take for all the current homes for sale on the market to sell. A healthy housing market usually has approximately six months of inventory. In the year prior to the pandemic, there was more than 3.5 months of housing inventory in the state. The pandemic has exposed and accelerated pre-existing housing supply constraints which can only be solved by more supply or a weaker consumer. CA Median Existing Home Price $662,170 | $680,881 In the third quarter of 2021, the median home price in California was up 17% compared to one year earlier. With mortgage rates at historic lows, coupled with healthy consumers, limited housing inventories have led to a surge in prices. In the short-term, the only relief from higher home prices could come from higher interest rates. In the longer-term, more supply is the key to relieving upward pressure on prices in the state. U.S. Unemployment Rate 4.3% | 3.9% The nation added 210,000 jobs in November as the unemployment rate fell to 4.2%. This figure is elevated compared to pre-pandemic levels but is low by historical standards. The real problem in today’s labor market is the 3-million-person decrease in the U.S. labor force, which has occurred over the last eighteen months. While unemployment typically rises in a downturn, the labor force does not typically decline. The current contraction has been driven primarily by retiring baby boomers. Record job openings indicate that there are ample opportunities for workers, and that labor shortages are the fundamental constraint on employment expansion. CA Unemployment Rate 6.0% | 5.2% The elevated unemployment rate is one of the most striking features of California’s recovery. In October 2021, the state’s unemployment rate stood at 7.3%, compared to 4.6% nationally. Prior to the pandemic, the state’s unemployment rate was 4.1%. The difference between the state and the nation is chiefly due to the jobs recovery that has occurred since the depths of the pandemic fallout. Early in the pandemic, some speculated that California’s safeguards against the pandemic, such as constraints on business activity, which were stricter than in other states, accounted for the state’s relatively severe job losses. However, capacity limits and distancing requirements have been removed for months. Currently, labor supply issues are the biggest constraint on employment expansion. CA Total Nonfarm Employment Growth -2.1% | -0.5% While California added jobs at a healthy rate in 2021, as of November 2021, there were 825,800 fewer people employed in the state than in pre-pandemic February 2020. Total nonfarm employment in California has contracted 4.7% since that time compared to a 2.6% drop nationally. The state’s labor force, defined as the population of workers who hold a job plus those looking for work, is still 414,700 workers lower than the pre-pandemic peak. While rising wages should draw workers back into the labor force, challenges including slow housing supply growth and recent constraints on international migration, pose difficulties to labor force expansion in the state. 2021/22 | 2022/23 2021/22 | 2022/23 HdL Companies Consensus Forecast December 2021 Scan to view the HdL Consenus Forecast 3Q21 webinar recording. ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 3 Page 76 of 114 Beacon Economics LLC 310.571.3399 | BeaconEcon.com Beacon Economics has proven to be one of the most thorough and accurate economic research/analytical forecasting firms in the country. Their evaluation of the key drivers impacting local economies and tax revenues provides additional perspective to HdL’s quarterly consensus updates. The collaboration and sharing of information between Beacon and HdL helps both companies enhance the accuracy of the work that they perform for their respective clients. HdL Companies 714.879.5000 | solutions@hdlcompanies.com | hdlcompanies.com California’s allocation data trails actual sales activity by three to six months. HdL compensates for the lack of current information by reviewing the latest reports, statistics and perspectives from fifty or more economists, analysts and trade associations to reach a consensus on probable trends for coming quarters. The forecast is used to help project revenues based on statewide formulas and for reference in tailoring sales tax estimates appropriate to each client’s specific demographics, tax base and regional trends. 888.861.0220 | solutions@hdlcompanies.com | hdlcompanies.com ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 3 Page 77 of 114 UCLA Anderson Forecast, December 2021 California–43 INEQUALITY, DELTA, AND A SLOWER RECOVERY The California Report: Delta, Migration and Relative Affordability Jerry Nickelsburg Director, UCLA Anderson Forecast December 2021 Introduction The Delta Surge of 2021 is waning but a new winter surge, Delta 2.0 is beginning to appear. Though economic activity continues to pick up, Delta 2.0, not assumed in our previ- ous forecast, will have a dampening effect on the rate of growth and time to recovery. As with our forecast for the U.S. the outlook for California is for continued, but slightly slower growth. In and among the discussion of Delta has been a narrative about people fleeing the Golden State. To be sure some have, but the net has been relatively small as evidenced by home prices at record levels and rental rates rapidly pushing upwards. But that is not the entire story of migration. There are also those that might have moved to California but for high housing costs. The 2020 census is in, and those domestic migrants (including some Californians) ended up in Texas, Arizona, Utah, Nevada and elsewhere. In this California report we investigate the impact of this diversion of domestic migration from the state on the rela- tive cost of housing and find that the equilibration process predicted by economic theory is at work. California hous- ing is not becoming more “affordable” but it is becoming relatively more affordable. The California report begins with a sectoral retrospective as the basis for the forecast for the next two years. This is followed by an analysis of relative affordability of homes in the state and find that over the past four years, relative af- fordability has in fact improved. We conclude with a section on the California forecast co-authored with my colleague Dr. Leila Bengali. Sectoral employment retrospective Job loss in California attributable to the pandemic has been concentrated in sectors where a high degree of human con- tact is an important part of the production of the services provided. Although most health care restrictions have been eliminated, it is still the case that the job deficit relative to February 2020 remains in three sectors; leisure and hospital- ity, education and other services (Chart 1). As of October, the reduction in payroll employment in these sectors was equal to 90% of the total net job deficit. The remaining job loss is spread widely over a number of sectors and is offset somewhat by the 70K net new payroll jobs in logistics and professional, scientific and technical services. As was dis- cussed in the section on non-pharmaceutical interventions and economic performance in a recent California report,1 the opening of the economy does not necessarily mean a return to normalcy. Even when there are few, if any, restrictions on businesses and individuals, elevated risk and a continued fear of infection dampens consumer demand and labor sup- ply. This has been true during the Delta surge and with what now appears to be a new winter wave of infections, ought to dampen the rate of recovery from what we expected in our September 2021 forecast. While the easing of restrictions did not result in a complete return to pre-pandemic employment, leisure and hospitality and education added by far the greatest number of jobs in the three months ending last October (Chart 2). After these two sectors the largest job gains were in administrative services where temps and consultants live, professional, scientific, Jerry Nickelsburg, ”Non-pharmaceutical interventions and economic performance revisited.” UCLA Anderson Forecast. June 2021. ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 78 of 114 44–California UCLA Anderson Forecast, December 2021 INEQUALITY, DELTA, AND A SLOWER RECOVERY and technical services and information. As the California economy expands it is increasingly clear that tech will once again drive growth. On a regional basis, payroll employment in most of the state grew faster than the nation for the three months ending October 2021 (Chart 3). Some of this rebound was fueled by strength in the tech, housing, and logistics sectors, but it was also due to the easing of pandemic restrictions and the beginning of a return to the workplace. Many of these counties experienced a greater decline in employment rela- tive to the U.S. in the previous year and they are now play- ing catch-up (Chart 4). The more lackluster growth in the North Bay and East Bay is a statistical anomaly. In fact, both gained jobs as their economy expanded. However, autumn is a time for increased tourism and the slower return of travel induced by the Delta surge resulted in slower hiring than in previous years. Because past seasonal patterns had a much larger increase in employment than experienced this year, the seasonally adjusted data result in a decline. The opposite will be true in coming months and the seasonally adjusted numbers will be higher than expected. As we move through the balance of the season of Delta, how this plays out remains an open question. As with any economic forecast today, an assumption about the pandemic is required. This is purely an assumption and not a forecast. Ours’ is that the current surge will abate through the Fall and a new winter surge, smaller than before, will take its place. This, along with news reports on break throughs and the large number of Californians not vaccinated will likely push a full recovery into the early part of 2023. The implication of this assumption about the pandemic is that leisure and hospitality and retail employment will lag due to a slower return of domestic consumers and international tourists and the failure of a significant number of small businesses in these few sectors. Source: California EDD Chart 1 -450 -400 -350 -300 -250 -200 -150 -100 -50 0 50 100 Tsp. Whs. & Util.Prof. Sci. & Tech.Federal Gov't.Mining & LoggingMgmt of CompaniesConstructionInformationHealth Care & Soc. Svc.Non-Durable GoodsDurable GoodsFinanceState & Local (excl Ed.)Wholesale TradeAdminist. SvcRetail TradeOther Svc.Leisure & HospitalityEducation (pvt + public)ThousandsCHANGE IN NO. OF JOBS BY SECTOR(February 2020 to Sept. 2021) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 79 of 114 UCLA Anderson Forecast, December 2021 California–45 INEQUALITY, DELTA, AND A SLOWER RECOVERY Source: EDD.ca.gov Chart 2 -20 0 20 40 60 80 100 120 Education (pvt + public)Leisure & HospitalityAdministrative SvsProf. Sci. & Tech.InformationConstructionRetail TradeState & Local (excl Ed.)Tsp. Whs. & Util.Other Svc.Durable GoodsFinanceNon-Durable GoodsMining & LoggingWholesale TradeMgmt of CompaniesHealth Care & Soc. Svc.Federal Gov't.ThousandsCHANGE IN NO. OF JOBS BY SECTORJune to Sept. 2021 Source: California EDD Chart 3 -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0%San DiegoSJ ValleySilicon ValleyCentral CoastSan FranciscoLos AngelesSac. DeltaInland EmpireOrange CountyU.S.East BayNorth BayCalifornia Regional Job Gain(July 2021 to Oct. 2021, SAAR) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 80 of 114 46–California UCLA Anderson Forecast, December 2021 INEQUALITY, DELTA, AND A SLOWER RECOVERY to amenities such as beaches, hiking trails, and museums. So, is California’s 44% metric bad? It is hard to say. But California’s climate and topography is viewed as valuable and therefore identical homes in Los Angeles and Houston ought to be priced differently with the LA homes incorpo- rating a climate and topography premium. When the price differential is exactly the premium according to household tastes and preferences, then we would expect net domestic migration due to home affordability to be zero, all other things equal. But all other things are not equal. California used to be the manufacturing powerhouse of the U.S. with ample middle- class jobs for high-school graduate factory workers. That is no longer the case. Thus, the changing composition of job offerings has led to migration, but it is that rather than hous- ing that is the proximate cause of the migration. Unravelling whether or not the California house price premium is too high, or whether or not migration is due to the changing composition of the California economy is tricky. The analy- sis below is suggestive of the home price premium being an important, but not exclusive driver of migration. To understand the dynamics, consider where Californians are moving. According to local reports the receiving cities are; Austin, Dallas and Houston Texas2, Las Vegas Nevada3, Seattle Washington4, Phoenix Arizona5, Boise Idaho 6,and Atlanta Georgia7. Despite the stream of anecdotes, the num- bers are small compared to the 40 million Californians who did not move out of state. However, the dynamics induced by the high cost of housing in California do not require a large number of Californians to move out of state. For ex- ample, a household considering Los Angeles or Houston and choosing Houston based on the cost of housing has the same qualitative impact on the relative price of housing in the two cities as the household moving from LA to the Gulf Coast. Instead of the arbitrary percentage of income, we examine the relative price of housing by city pair beginning in 1990. The year 1990 was chosen because the average net domestic migration between 1985 and 1994 was approximately zero.8 For each of the city pairs discussed below, the 1990 median 2. https://austin.culturemap.com/news/city-life/10-21-21-austin-among-the-top-texas-cities-californians-are-relocating-to-aus/ 3. https://www.reviewjournal.com/news/news-columns/road-warrior/most-new-nevada-residents-migrating-from-california-data-shows-2332843/ 4. https://www.seattlepi.com/realestate/article/What-to-know-when-moving-to-Seattle-from-15919477.php 5. https://azbigmedia.com/lifestyle/new-yorkers-californians-flee-to-move-to-arizona/ 6. https://boisedev.com/news/2021/05/06/boise-migration/ 7. https://www.ajc.com/business/for-fleeing-californias-atlanta-top-destination/uGx08Y3VNiQqhshTGcx6AP/ 8. https://dof.ca.gov/Reports/Demographic_Reports/documents/DOMMIG.pdf Relative Affordability and Migration California home prices continue to climb, and a lack of affordability has become increasingly important in both the policy sphere and for forecasting the Golden State’s economic growth. Over the past two years median home prices as reported by the California Association of Realtors have increased 33.6% to a record high $800K. The S&P Case Shiller Home Price Index which measures price changes on same-home sales for San Diego, Los Angeles and San Francisco increased by 34.9%, 26.1% and 25.9% over the same period. Soaring home prices and a lack of affordability are often cited as reasons for net domestic migration out of California. The open question for the forecast is whether or not this will accelerate, stabilize or reverse. In this sec- tion we examine relative affordability measured through a comparison of California cities and some selected competi- tive cities outside the state. Recent data indicate increased relative affordability even while California becomes more expensive, but also point to other factors which can reverse those trends such as the boom in the Bay Area tech sector from 2012 to 2017. The implication for the forecast is that net out-migration ought to continue to slow and become less of a drag on aggregate economic growth. However, the data are silent on when net out-migration becomes zero or positive. Before turning to data to answer these questions, it is use- ful to consider what we mean by affordability. Standard measures compare the median home price with the median household’s income. Typically, cities for which these metrics imply mortgage payments at or below 30% of income are considered “affordable” and higher than that “unaffordable.” For households at the median income level in California purchasing a median home with 20% down ($160K) and a 3.125% 30-year fixed mortgage, the percentage is 44%. But this threshold is an arbitrary artifact of late 19th Century housing markets. A house is more than just a structure; it is also the land on which that structure sits. Realtors will recite the mantra “location, location, location,” when referring to the value of a home because location implies greater or lesser access ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 81 of 114 UCLA Anderson Forecast, December 2021 California–47 INEQUALITY, DELTA, AND A SLOWER RECOVERY home price in the California city was divided by the 1990 median home price in the paired city to create measures of the California premium. Home price appreciation over the 31 years between 1990 and 2021 in each city were used to adjust the premia over time. This then allows us to observe the relative cost of housing, and infer demand shifts due to migration. For example, if the median home price in Orange County were 3 times that of the median home price in Miami in 1990, and home prices in the two increased by 10% and 20% respectively, then the home price premium for Orange County would have shrunk with the faster rise in housing costs in Miami. Chart 4 plots the Los Angeles premium for each of Phoenix, Las Vegas and Austin relative to the 1990 premium. For Austin the premium was inflated during the speculative hous- ing boom of 2004 to 2008, but not for the other two cities. Texas did not have the same housing bubble as California, Nevada, and Arizona. Subsequent to the 2008/2009 reces- sion, Las Vegas, struggling with an oversupply of housing, experienced a greater decline in home prices and this resulted in a higher L.A. premium. From 2012 forward the premium declined for each of the cities with it falling from 60% above the 1990 premium to 25% for Las Vegas; 4% above to 23 percent below the 1990 premium for Phoenix; and 32% below to 45% below the 1990 premium for Austin. Thus, Los Angeles has become relatively more affordable over the last decade as compared to these three competitive cities. There can be a multitude of explanations for this. Austin could have become more attractive with additional cultural amenities and Los Angeles less so, migration due to high housing costs could have pushed down the premium, and differential job opportunities that were not present in 1990 would be a few of the explanations. Source: US Census, FHFA, UCLA Anderson Forecast Chart 4 -60% -40% -20% 0% 20% 40% 60% 80% 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021PERCENTLOS ANGELES HOUSING PREMIUM(PERCENT CHANGE RELATIVE TO 1990 PREMIUM) AUSTIN PHOENIX LAS VEGAS ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 82 of 114 48–California UCLA Anderson Forecast, December 2021 INEQUALITY, DELTA, AND A SLOWER RECOVERY Chart 5 is a plot of the home price premium between San Francisco, and Seattle, Austin and Boise. As with Los An- geles, the premia fluctuate with the fortunes of the cities. Nevertheless, over the past six years the premium for each of the paired cities has declined to be less than the 1990 premium. The greatest declines were for Austin and Boise. Even though homes are still more affordable there than in the Bay Area, in each the local political establishment and news media are highlighting the city’s new housing afford- ability crisis.9 As with Los Angeles, Bay Area housing is becoming less “affordable” in absolute terms but relatively more affordable. Chart 6 is a plot of the home price premium between Silicon Valley, and Seattle, Austin, Nashville, and Boise. As with Los Angeles and San Francisco, the premia have declined over the past six years and are now less than in 1990. And, even though home prices continue to soar in Santa Clara County, they are not going up as rapidly as in these competitive cities. These six cities are properly characterized as up-and-coming cities; ones that were relatively small until migration over the last decade created larger, more mature cities. For ex- ample, Austin’s population grew by nearly 30% over the last decade and Phoenix’s population grew by 18%. Charts 7 to 9 show the evolution of California city premia relative to the more mature cities of Houston, Dallas and Atlanta. For Dallas and Atlanta the premium over the last decade has been relatively flat. Though there was an influx of new residents, home prices were neither increasing faster nor slower than in California. Houston, a city more heavily dependent on the vagaries of oil prices on the local economy, is the exception with a premium in 2021 that is higher than that of a decade ago. Though this analysis is on a limited number of cities, it extends to a much greater set of cities. Smaller cities that have become attractors for migration have experienced a more rapid increase in home prices than California cities and are therefore becoming relatively less affordable and larger more mature cities are experiencing similar housing price appreciation to their California counterparts. The relative premium analysis above is suggestive of the equilibration process predicted by economic theory. Cities that are much more affordable will become relatively less 9. https://www.texaspolicy.com/multimedia/article/priced-out-austins-growing-affordability-crisis https://www.ktvb.com/article/news/local/growing-idaho/boise-home-values-go-from-affordable-unattainable-housing-crisis-costs/277-9e81ede2-e567-4371-b240-189927e13433 https://www.tennessean.com/story/money/real-estate/2021/06/07/nashville-affordable-housing-task-force-recommendations-costs/7584374002/https://www.seattletimes.com/opinion/the-magnitude-of-our-housing-shortage-requires-more-action/ Source: US Census, FHFA, UCLA Anderson Forecast Chart 5 -50% -40% -30% -20% -10% 0% 10% 20% 30% 40% 50% 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021PERCENATSAN FRANCISCO HOUSING PREMIUM(PERCENT CHANGE RELATIVE TO 1990 PREMIUM) AUSTIN SEATTLE BOISE ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 83 of 114 UCLA Anderson Forecast, December 2021 California–49 INEQUALITY, DELTA, AND A SLOWER RECOVERY Source: US Census, FHFA, UCLA Anderson Forecast Chart 6 -40% -30% -20% -10% 0% 10% 20% 30% 40% 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021PERCENTSILICON VALLEY HOUSING PREMIUM(PERCENT CHANGE RELATIVE TO 1990 PREMIUM AUSTIN NASHVILLE SEATTLE BOISE Source: US Census, FHFA, UCLA Anderson Forecast Chart 7 -60% -40% -20% 0% 20% 40% 60% 80% 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021PERCENTLOS ANGELES HOUSING PREMIUM(PERCENTAGE CHANGE RELATIVE TO 1990 PREMIUM) ATLANTA DALLAS HOUSTON ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 84 of 114 50–California UCLA Anderson Forecast, December 2021 INEQUALITY, DELTA, AND A SLOWER RECOVERY Source: US Census, FHFA, UCLA Anderson Forecast Chart 8 -40% -20% 0% 20% 40% 60% 80% 100% 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 SAN FRANCISCO HOUSING PREMIUM(PERCENTAGE CHANGE RELATIVE TO 1990 PREMIUM) ATLANTA DALLAS HOUSTON Source: US Census, FHFA, UCLA Anderson Forecast Chart 9 -40% -20% 0% 20% 40% 60% 80% 100% 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021PERCENTSILICON VALLEY HOUSING PREMIUM(PERCENTAGE CHANGE RELATIVE TO 1990) ATLANTA DALLAS HOUSTON ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 85 of 114 UCLA Anderson Forecast, December 2021 California–51 INEQUALITY, DELTA, AND A SLOWER RECOVERY so up until the point where the differential cost of housing just compensates for the differential lifestyle offered by the competing municipalities. Charts 10 and 11 illustrate this point. Chart 10 is a plot of net domestic migration from Los Angeles to anywhere else in the US and the Los Angeles home price premium over Phoenix. Though the chart does not show the migration to Phoenix, it is striking that out migration from LA and the decline in the premium are cor- related. Chart 11 is a plot of the same two variables for San Francisco and Seattle. When net domestic migration was inbound to San Francisco, the premium increased. When it was outbound, it decreased. There are two main conclusions from this analysis. First, while California housing may be becoming less affordable, it is becoming relatively more affordable due to a shift in Source: US Census, FHFA, CA Department of Finance, UCLA Anderson Forecast Chart 10 0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2% -25% -20% -15% -10% -5% 0% 5% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Migration % of PopulationPremium relative to 1990Net Domestic Migration from Los Angeles& LA Home Price Premium Over Phoenix LA Premium LA Migration Source: US Census, FHFA, CA Department of Finance, UCLA Anderson Forecast Chart 11 -0.6% -0.4% -0.2% 0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 0% 5% 10% 15% 20% 25% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Migration % of PopulationPercentage relative to 1990Net Domestic Migration from San Francisco& SF Home Price Premium Over Seattle SF Premium SF Migration ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 86 of 114 52–California UCLA Anderson Forecast, December 2021 INEQUALITY, DELTA, AND A SLOWER RECOVERY the demand for housing to more affordable competing cit- ies. Second, the dynamics are complicated by the type of opportunities available. When San Francisco was booming and this was an important center of innovation and wealth generation, the premium increased. As Seattle and Austin began to catch up, it decreased. For more mature cities, the premium seems to have stabilized. Since 1990 was a time of zero net migration, but stabilization of the premium has not occurred for many competing cities, we infer that net domestic migration out of California due to the high cost of housing will continue for the next few years, the premia will decline further, and net domestic out-migration is therefore expected to diminish. The California Forecast Jerry Nickelsburg, Director, UCLA Anderson Forecast Leila Bengali, Economist, UCLA Anderson Forecast Our discussion of the forecast begins with a new assumption (not a prediction) about the timing of the pandemic: that there will be an increase in covid-19 cases this winter in the state but no new measures to restrict people or businesses. With this assumption, we expect some labor market head- winds in the state for the end of this year and early into next. We expect, based on past patterns, that a rise in cases will curtail economic activity in some sectors due to consumers pulling back from (or being more wary about returning to) in-person activities and travel. Job growth will be slower in sectors with high levels of personal contact and in sectors that cater to tourists, as we expect few tourists from Asian countries and for European tourists to hold off on travel to the U.S. as cases rise. Another implication of a pullback from in-person activities is a slower decline in goods purchases. This will contribute to the high demand in the logistics industry, and we expect solid growth in this sector as ports continue to work through backlogs. We have already seen high demand for goods: taxable sales in the state were much stronger over the summer than we expected, a trend that we anticipate will continue. The timing of our forecast for California is slightly different from last time, weaker late this year and early next with the economy picking up in mid-2022. The potential economic effects arising from the emergence of the omicron variant are a downside risk to our forecast. The unemployment rate is expected to reach 7.0% in the fourth quarter of this year, falling to an annual average of 5.6% in 2022 and 4.4% in 2023. We expect nonfarm payroll job growth for 2021, 2022, and 2023 to be 1.9%, 4.7%, and 2.5%. Inflation is expected to be higher than in the past, but largely below inflation in the U.S.: 4.0%, 4.1%, and 2.9% year-over-year in 2021, 2022, and 2023. Inflation will reduce real personal income to some degree, though we expect real personal income to grow faster in California than in the U.S.: 2.6%, -2.2%, and 2.9% in 2021, 2022, and 2023, with the negative number in 2022 a result of government stimulus programs ending. With the high demand for housing signaled by the rise in house prices, we expect more construction as supply rises to meet demand. Permits are expected to be 119.5, 123.7, and 139.7 thousand per year in 2021, 2022, and 2023. ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 87 of 114 THE UCLA ANDERSON FORECAST FOR CALIFORNIA DECEMBER 2021 REPORT Tables ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 88 of 114 FORECAST TABLES - SUMMARY UCLA Anderson Forecast, December 2021 California–55 Summary of the UCLA Anderson Forecast for California by Calendar Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Personal Income and Taxable Sales Personal Income (Bil. $) 1857.2 1980.7 2125.4 2218.5 2318.6 2431.8 2544.2 2763.3 2948.5 3003.9 3179.4 (% Ch.) 1.6 6.7 7.3 4.4 4.5 4.9 4.6 8.6 6.7 1.9 5.8 Real Personal Income (Bil. 2012 $) 1829.3 1917.1 2028.3 2069.4 2100.7 2124.3 2160.1 2303.9 2364.8 2312.4 2378.7 (% Ch.) 0.1 4.8 5.8 2.0 1.5 1.1 1.7 6.7 2.6 -2.2 2.9 Taxable Sales (Bil. $) 586.4 615.4 638.1 653.4 678.1 708.2 734.5 708.5 777.9 808.3 835.3 (% Ch.) 5.1 4.9 3.7 2.4 3.8 4.4 3.7 -3.5 9.8 3.9 3.3 Real Taxable Sales (Bil. 2012 $) 577.6 595.6 608.9 609.6 614.3 618.6 623.5 590.5 623.6 622.2 625.0 (% Ch.) 3.5 3.1 2.2 0.1 0.8 0.7 0.8 -5.3 5.6 -0.2 0.4 Price Inflation (% Change) Consumer Prices 1.5 1.8 1.4 2.3 3.0 3.7 2.9 1.8 4.0 4.1 2.9 Employment and Labor Force (Household Survey) Employment (% Ch.) 2.1 2.2 2.2 1.8 1.6 1.1 0.6 -8.9 3.4 3.8 2.9 Labor Force (% Ch.) 0.4 0.6 0.8 1.0 0.8 0.5 0.5 -2.8 0.6 1.4 1.6 Unemployment Rate (%) 9.0 7.6 6.2 5.5 4.8 4.3 4.2 10.2 7.7 5.6 4.4 Nonfarm Employment (Payroll Survey, % Change) Total Nonfarm 2.6 2.8 3.0 2.7 2.1 2.1 1.5 -7.4 1.9 4.7 2.5 Natural Resources & Min. -0.1 3.3 -9.6 -15.6 -1.9 2.5 0.2 -11.9 -3.8 3.6 4.0 Construction 8.0 5.8 8.5 5.9 4.5 6.2 2.9 -3.5 3.0 1.9 2.1 Manufacturing 0.2 1.4 1.8 0.5 0.2 0.9 0.2 -4.9 -0.1 2.1 1.3 Nondurable Goods 0.5 1.2 1.3 0.9 -0.6 -1.1 -0.4 -6.9 -0.2 3.0 1.5 Durable Goods -0.0 1.6 2.1 0.3 0.7 2.0 0.6 -3.9 -0.1 1.7 1.3 Tran., Warehousing & Utility. 3.2 4.1 6.2 6.7 6.3 5.2 5.9 3.4 5.7 2.7 1.5 Trade 1.8 2.1 1.7 0.9 0.5 -0.1 -1.4 -7.8 2.6 0.8 -1.5 Information 3.1 2.9 5.3 7.8 0.7 2.6 3.5 -6.1 2.8 8.2 5.0 Financial Activities 1.2 -0.0 2.5 2.6 1.2 0.7 0.4 -3.0 -0.5 2.2 1.7 Professional & Bus. Servs. 4.4 3.4 2.6 1.6 2.0 3.4 2.0 -4.6 3.5 5.4 3.6 Educational & Health Servs. 3.4 3.0 3.6 3.6 3.9 2.7 3.1 -2.7 1.7 3.3 1.8 Leisure & Hospitality 4.9 4.9 4.1 4.1 2.7 2.0 2.2 -27.5 5.8 16.9 5.4 Other Services 2.4 3.7 1.6 1.8 1.9 1.4 0.8 -18.0 1.6 9.6 8.0 Federal Government -1.9 -1.3 0.8 1.3 0.2 -0.7 0.8 5.1 -3.0 -0.2 0.6 State and Local Government 0.1 2.0 2.2 2.3 1.7 1.3 0.6 -5.2 -2.2 3.4 3.4 Nonfarm Employment (Payroll Survey, Thousands) Total Nonfarm 15151.1 15575.2 16048.8 16479.0 16827.2 17174.4 17432.3 16138.9 16445.1 17210.5 17639.1 Natural Resources & Min. 28.3 29.2 26.4 22.3 21.9 22.4 22.5 19.8 19.0 19.7 20.5 Construction 637.7 674.6 731.8 775.1 810.1 860.6 885.7 854.3 879.8 896.9 915.4 Manufacturing 1262.3 1280.2 1303.3 1310.1 1312.7 1324.1 1326.9 1261.4 1259.7 1286.4 1303.6 Nondurable Goods 470.7 476.2 482.6 487.0 484.2 478.7 476.8 444.0 443.2 456.4 463.1 Durable Goods 791.6 804.0 820.7 823.1 828.5 845.4 850.1 817.3 816.5 830.0 840.5 Tran., Warehousing & Utility 503.7 524.5 557.2 594.4 631.9 664.4 703.9 728.2 769.5 789.9 801.5 Trade 2264.1 2310.6 2350.5 2372.4 2383.7 2381.9 2349.1 2166.6 2222.9 2241.7 2207.4 Information 450.2 463.5 488.2 526.4 530.1 543.9 562.7 528.2 543.1 587.4 616.9 Financial Activities 783.1 782.8 802.4 822.9 832.7 838.2 841.4 815.9 811.4 829.0 842.8 Professional & Bus. Servs. 2348.0 2427.2 2490.4 2531.4 2582.0 2669.5 2722.0 2596.6 2687.8 2833.3 2934.0 Educational & Health Servs. 2308.7 2378.1 2464.4 2552.0 2650.4 2722.6 2808.2 2731.5 2778.8 2869.4 2921.4 Leisure & Hospitality 1675.3 1756.7 1828.6 1902.8 1953.9 1993.5 2036.4 1476.7 1562.7 1827.4 1926.1 Other Services 515.7 534.8 543.4 553.5 563.8 571.9 576.5 473.0 480.4 526.4 568.7 Federal Government 245.6 242.5 244.4 247.5 248.0 246.2 248.1 260.7 252.9 252.5 254.1 State and Local Government 2128.4 2170.4 2217.9 2268.2 2305.9 2335.3 2348.8 2226.1 2177.1 2250.4 2326.7 Construction Activity, Auto Registrations, and Population Residential Building Permits (Thous. Units) 85.4 85.2 98.2 98.9 112.8 114.3 111.0 100.4 119.5 123.7 139.7 Nonresidential Construction Value (Mil. 2012 $) 21368.4 21296.7 23982.2 23836.1 24795.7 27921.8 26389.8 18363.6 13978.7 15216.3 17710.6 Value (Mil. $) 21687.5 22833.9 26240.0 26135.2 27911.6 31940.8 31406.8 22194.2 17535.7 20369.4 24645.8 Auto Registrations (Mil.) 1.7 1.8 2.0 2.0 1.9 1.9 1.8 1.4 1.6 1.5 1.6 Net Immigration (Thous., Past Year) 61.1 59.1 54.0 24.9 15.6 -8.6 -79.8 -128.3 -154.2 -95.6 -12.9 Population (Thous.) 38352.4 38665.4 38966.0 39222.3 39455.5 39641.6 39745.3 39776.7 39765.2 39783.6 39876.7 (% Ch.) 0.8 0.8 0.8 0.7 0.6 0.5 0.3 0.1 -0.0 0.0 0.2 Source for residential and nonresidential permit and construction data: Construction Industry Research Board (CIRB), a service provided by the California Homebuilding Foundation (CHF). http://www.cirbreport.org/ ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 89 of 114 FORECAST TABLES - QUARTERLY SUMMARY 56–California UCLA Anderson Forecast, December 2021 Summary of the UCLA Anderson Forecast for California by Quarter 2021Q3 2021Q4 2022Q1 2022Q2 2022Q3 2022Q4 2023Q1 2023Q2 2023Q3 2023Q4 Personal Income and Taxable Sales Personal Income (Bil. $, S.A. Annualized) 2904.0 2917.6 2944.6 2976.9 3022.2 3072.0 3114.7 3157.1 3201.1 3244.5 (% Ch. A. R.) -2.1 1.9 3.8 4.5 6.2 6.8 5.7 5.6 5.7 5.5 Real Personal Income (Bil. 2012 $, S.A. Annualized) 2306.3 2293.7 2294.3 2300.3 2317.2 2337.8 2353.8 2369.9 2387.2 2404.0 (% Ch. A. R.) -7.2 -2.2 0.1 1.1 3.0 3.6 2.8 2.8 3.0 2.8 Taxable Sales (Bil. $, S.A. Annualized) 779.7 788.9 793.5 805.8 813.2 820.6 826.0 832.8 838.9 843.6 (% Ch. A. R.) -1.7 4.8 2.4 6.3 3.8 3.7 2.6 3.4 2.9 2.3 Real Taxable Sales (Bil. 2012 $, S.A. Annualized) 619.2 620.2 618.3 622.7 623.5 624.5 624.2 625.2 625.6 625.1 (% Ch. A. R.) -6.8 0.6 -1.2 2.9 0.6 0.6 -0.2 0.6 0.3 -0.3 Price Inflation (% Change Annualized Rate) Consumer Prices 5.5 4.1 3.7 3.4 3.2 3.1 2.8 2.7 2.6 2.6 Employment and Labor Force (Household Survey) Employment (% Ch. A. R.) 3.2 3.9 2.4 5.8 4.0 3.1 2.0 3.0 2.7 1.7 Labor Force (% Ch. A. R.) 2.2 1.7 0.6 1.8 1.7 1.6 1.8 1.6 1.4 1.2 Unemployment Rate (%, S.A.) 7.5 7.0 6.6 5.7 5.2 4.8 4.8 4.5 4.2 4.1 Nonfarm Employment (Payroll Survey, % Change Annualized Rate) Total Nonfarm 6.9 5.4 2.6 5.7 3.0 2.9 1.5 2.4 2.3 1.5 Natural Resources & Min. 0.7 17.2 -1.8 3.4 3.6 3.7 4.1 3.9 5.9 1.9 Construction 0.1 -1.6 4.5 2.9 3.5 2.8 0.6 2.2 2.1 1.9 Manufacturing 1.5 4.3 0.9 2.6 1.2 1.0 1.9 1.3 0.9 -0.0 Nondurable Goods 4.6 6.7 1.0 3.0 0.7 2.1 1.6 1.6 1.5 -1.2 Durable Goods -0.1 3.0 0.9 2.5 1.4 0.4 2.1 1.2 0.6 0.6 Tran., Warehousing & Utility 2.0 6.1 2.2 1.7 -0.3 2.0 0.3 2.6 2.5 2.4 Trade 1.0 2.7 1.0 0.1 -0.2 -2.3 -2.8 -1.3 -0.7 -0.7 Information 12.1 8.7 3.5 11.3 8.8 7.2 2.2 4.2 2.9 3.4 Financial Activities -1.0 4.7 1.6 3.1 2.3 1.9 1.3 1.7 1.2 0.9 Professional & Bus. Servs. 3.9 10.9 2.0 7.2 2.9 5.2 2.1 3.2 4.5 1.7 Educational & Health Servs. 3.1 2.7 3.4 4.4 1.7 2.6 0.9 2.0 1.2 1.8 Leisure & Hospitality 39.3 14.2 5.7 20.3 8.8 5.7 2.8 4.7 2.5 3.2 Other Services 21.2 4.6 4.0 17.2 3.2 6.0 10.5 8.4 8.1 4.1 Federal Government -2.3 -0.6 0.8 0.4 0.8 0.6 0.6 0.6 0.6 0.6 State and Local Government 8.7 2.3 2.0 2.7 4.3 3.8 3.5 3.2 3.2 1.4 Nonfarm Employment (Payroll Survey, Thousands, S.A.) Total Nonfarm 16609.4 16829.6 16937.9 17175.8 17301.7 17426.7 17493.6 17599.5 17698.0 17765.3 Natural Resources & Min. 18.8 19.6 19.5 19.6 19.8 20.0 20.2 20.4 20.7 20.8 Construction 880.5 876.9 886.7 893.1 900.8 907.1 908.3 913.2 917.9 922.2 Manufacturing 1261.0 1274.5 1277.4 1285.8 1289.5 1292.7 1298.9 1303.2 1306.2 1306.1 Nondurable Goods 444.5 451.8 452.9 456.2 457.1 459.4 461.2 463.0 464.8 463.4 Durable Goods 816.5 822.7 824.6 829.6 832.5 833.2 837.6 840.2 841.5 842.7 Tran., Warehousing & Utility 770.9 782.4 786.8 790.1 789.4 793.3 794.0 799.1 804.1 808.9 Trade 2224.7 2239.3 2245.1 2245.7 2244.4 2231.6 2215.6 2208.5 2204.7 2201.0 Information 550.6 562.2 567.1 582.5 594.8 605.3 608.6 615.0 619.4 624.6 Financial Activities 808.5 817.8 821.0 827.3 832.0 835.8 838.5 842.0 844.5 846.4 Professional & Bus.Servs. 2693.8 2764.4 2777.8 2826.2 2846.4 2882.8 2897.7 2920.3 2952.9 2965.1 Educational & Health Servs. 2793.9 2812.3 2835.6 2866.5 2878.6 2896.8 2903.4 2917.5 2925.9 2938.7 Leisure & Hospitality 1659.9 1715.8 1739.9 1822.2 1860.9 1886.7 1899.9 1921.7 1933.5 1949.0 Other Services 496.5 502.1 507.0 527.5 531.7 539.5 553.2 564.5 575.6 581.5 Federal Government 251.9 251.5 252.0 252.2 252.7 253.1 253.5 253.9 254.3 254.6 State and Local Government 2198.5 2210.9 2222.1 2237.0 2260.7 2282.0 2301.8 2320.2 2338.3 2346.4 Construction Activity, Auto Registrations, and Population Residential Building Permits (Thous. Units, S.A. Annualized) 104.1 110.7 118.3 120.1 125.9 130.7 136.3 138.3 141.7 142.3 Nonresidential Construction Value (Mil. 2012 $, S.A. Annualized) 11426.9 14271.9 14177.7 14937.7 15573.7 16176.2 16765.1 17329.5 18044.0 18703.7 Value (Mil. $, S.A. Annualized) 14630.6 18229.7 18376.4 19819.4 21094.8 22186.9 23129.2 24010.6 25154.6 26288.7 Auto Registrations (Mil., S.A. Annualized) 1.5 1.4 1.4 1.5 1.5 1.5 1.6 1.6 1.6 1.6 Net Immigration (Thous., Past 4 Qtrs.) -167.6 -141.8 -132.9 -100.1 -83.2 -66.2 -33.4 -16.5 -3.5 1.5 Population (Thous.) 39761.0 39762.0 39764.6 39774.8 39788.7 39806.2 39831.3 39860.1 39891.6 39923.7 (% Ch. A. R.) -0.1 0.0 0.0 0.1 0.1 0.2 0.3 0.3 0.3 0.3 Source for residential and nonresidential permit and construction data: Construction Industry Research Board (CIRB), a service provided by the California Homebuilding Foundation (CHF). http://www.cirbreport.org/ ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 90 of 114 DECEMBER 2021 REPORT THE UCLA ANDERSON FORECAST FOR CALIFORNIA Charts ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 91 of 114 CHARTS – RECENT EVIDENCE UCLA Anderson Forecast, December 2021 California–59 14,000 15,000 16,000 17,000 18,000 19,000 2012 2014 2016 2018 2020 2022 Payroll Survey Emp. Household Survey Emp. California Employment (Thous., S.A.) 2 4 6 8 10 12 14 16 2012 2014 2016 2018 2020 2022 California Unemployment Rate (Percent, S.A.) 500 550 600 650 700 750 800 850 2012 2014 2016 2018 2020 2022 California Taxable Sales (Bil. $, S.A. Annualized) 0.8 1.0 1.2 1.4 1.6 1.8 2.0 2.2 2012 2014 2016 2018 2020 2022 California New Car Registrations (Mil., S.A. Annualized) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 92 of 114 CHARTS – RECENT EVIDENCE 60–California UCLA Anderson Forecast, December 2021 0 20 40 60 80 100 120 140 160 2012 2014 2016 2018 2020 2022 Single-Family Multi-Family California New Residential Units Authorized By Building Permits (Thous., S.A. Annualized) Source for residential and nonresidential permit and construction data: Construction Industry Research Board (CIRB), a service provided by the California Homebuilding Foundation (CHF). http://www.cirbreport.org/ 10,000 15,000 20,000 25,000 30,000 35,000 2012 2014 2016 2018 2020 2022 California Nonresidential Construction Authorized By Building Permits, Value (3-qtr. moving avg.) (Mil. $, S.A. Annualized) Source for residential and nonresidential permit and construction data: Construction Industry Research Board (CIRB), a service provided by the California Homebuilding Foundation (CHF). http://www.cirbreport.org/ 550 600 650 700 750 800 850 900 950 2012 2014 2016 2018 2020 2022 California Construction Employment (Thous., S.A.) 1,800 1,900 2,000 2,100 2,200 2,300 12,000 13,000 14,000 15,000 16,000 2012 2014 2016 2018 2020 2022 Goods Producing (Left) Services (Right) California Employment by Sector (Thous., S.A.) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 93 of 114 CHARTS – RECENT EVIDENCE UCLA Anderson Forecast, December 2021 California–61 -10 -5 0 5 10 15 2012 2014 2016 2018 2020 2022 California U.S. Real Personal Income California versus U.S. (% Ch. Year Ago) -16 -12 -8 -4 0 4 8 12 2012 2014 2016 2018 2020 2022 California U.S. Nonfarm Employment California versus U.S. (% Ch. Year Ago) 2 4 6 8 10 12 14 16 2012 2014 2016 2018 2020 2022 California U.S. Unemployment Rate California versus U.S. (Percent, S.A.) -15 -10 -5 0 5 10 15 2012 2014 2016 2018 2020 2022 Nonfarm Emp. Real Personal Income California Employment and Real Personal Income (% Ch. Year Ago) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 94 of 114 CHARTS – FORECAST 62–California UCLA Anderson Forecast, December 2021 -20 -10 0 10 20 30 2012 2014 2016 2018 2020 2022 California Real Taxable Sales (% Ch. Year Ago) -1 0 1 2 3 4 5 6 2012 2014 2016 2018 2020 2022 California U.S. Consumer Price Index California versus U.S. (% Ch. Year Ago) 10.8 11.0 11.2 11.4 11.6 11.8 12.0 12.2 2012 2014 2016 2018 2020 2022 Employment Population California Share of U.S. Employment and Population (Percent) 14,000 14,500 15,000 15,500 16,000 16,500 17,000 17,500 18,000 2012 2014 2016 2018 2020 2022 History & Forecast Trend California Nonfarm Employment History & Forecast versus Trend (Thous., S.A.) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 95 of 114 CHARTS – FORECAST UCLA Anderson Forecast, December 2021 California–63 -0.4 0.0 0.4 0.8 1.2 1.6 2.0 2000 2005 2010 2015 2020 California Population Growth (% Ch. A. R.) -200 -100 0 100 200 300 2012 2014 2016 2018 2020 2022 Net Migration Natural Increase California Net Natural Population Increase and Net Migration (Thous., Over Past 4 Qtrs.) 31 32 33 34 35 36 37 38 39 40 2012 2014 2016 2018 2020 2022 California U.S. Population of California versus U.S. (CA. Mil.; U.S. 10 Mil.) 46.5 47.0 47.5 48.0 48.5 49.0 49.5 50.0 2012 2014 2016 2018 2020 2022 California U.S. Gross Labor Force Participation Rate (Labor Force/Total Population) California versus U.S. (Percent, S.A.) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 96 of 114 CHARTS – FORECAST 64–California UCLA Anderson Forecast, December 2021 8 12 16 20 24 28 32 2012 2014 2016 2018 2020 2022 California Nonresidential Construction Authorized By Building Permits, Real Value (Bil. 2012 $, S.A. Annualized) Source for residential and nonresidential permit and construction data: Construction Industry Research Board (CIRB), a service provided by the California Homebuilding Foundation (CHF). http://www.cirbreport.org/ 160 200 240 280 320 360 400 2012 2014 2016 2018 2020 2022 U.S. Median Price of Existing Single-Family Homes (Thous. $, S.A.) 0 20 40 60 80 100 120 140 160 2012 2014 2016 2018 2020 2022 Single-Family Multi-Family California New Residential Units Authorized By Building Permits (Thous., S.A. Annualized) Source for residential and nonresidential permit and construction data: Construction Industry Research Board (CIRB), a service provided by the California Homebuilding Foundation (CHF). http://www.cirbreport.org/ 550 600 650 700 750 800 850 900 950 2012 2014 2016 2018 2020 2022 California Construction Employment (Thous., S.A.) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 97 of 114 CHARTS – FORECAST UCLA Anderson Forecast, December 2021 California–65 2,100 2,200 2,300 2,400 2,500 2,600 2,700 2,800 2,900 3,000 2012 2014 2016 2018 2020 2022 California Employment in Education and Health Services (Thous., S.A.) 1,220 1,240 1,260 1,280 1,300 1,320 1,340 2012 2014 2016 2018 2020 2022 California Employment in Manufacturing (Thous., S.A.) 400 440 480 520 560 600 640 2012 2014 2016 2018 2020 2022 California Employment in Information (Thous., S.A.) 2,000 2,100 2,200 2,300 2,400 2012 2014 2016 2018 2020 2022 California Employment in Trade (Thous., S.A.) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 98 of 114 CHARTS – FORECAST 66–California UCLA Anderson Forecast, December 2021 740 760 780 800 820 840 860 2012 2014 2016 2018 2020 2022 California Employment in Financial Activities (Thous., S.A.) 2,100 2,150 2,200 2,250 2,300 2,350 2,400 2012 2014 2016 2018 2020 2022 California Employment in State and Local Government (Thous., S.A.) 2,100 2,200 2,300 2,400 2,500 2,600 2,700 2,800 2,900 3,000 2012 2014 2016 2018 2020 2022 California Employment in Professional & Business Services (Thous., S.A.) 240 245 250 255 260 265 270 275 280 2012 2014 2016 2018 2020 2022 California Employment in Federal Government (Thous., S.A.) ITEM NUMBER: C-1 DATE: 04/26/22 ATTACHMENT: 4 Page 99 of 114 ITEM NUMBER: C-2 DATE: 04/26/22 Atascadero City Council Staff Report – Police Department AB 481 – Military Equipment Policy RECOMMENDATION: Council review and receive the proposed 2022-2023 Military Equipment Policy in accordance with AB 481. DISCUSSION: On September 30, 2021, California Assembly Bill 481 (AB 481) was signed into law, which codified California Government Code Sections 7070 to 7075. The text of AB 481 is attached to this staff report for reference. AB 481 requires a law enforcement agency to obtain approval of, by ordinance at a regular meeting, a military equipment policy related to any funding, acquisition, or use of military equipment. The items considered to be “military equipment” are defined under Government Code Section 7070(c), and include such things as weapons using .50 caliber rounds or greater and flashbang grenades. AB 481 also requires the City Council to annually review and approve any military equipment policy adopted by ordinance. Any proposed policy must be posted on the City’s website at least 30 days before that annual review and approval. Pursuant to Government Code Section 7071(a)(2), no later than May 1, 2022, the Atascadero Police Department shall commence a City Council approval process of a proposed military equipment policy in order for the City to continue to use its existing equipment that may be considered “military equipment” under the statute. To commence the process, attached for the City Council’s review is a 2022-2023 Military Equipment Policy that covers military equipment already in use by the City and satisfies the requirement of AB 481. At the May 10, 2022 City Council Meeting, a draft ordinance for the adoption and approval of the Military Equipment Policy will be brought before the City Council for review and introduction. If the City Council does not approve the continuing use of military equipment, and adopt the ordinance, the Police Department shall cease its use of the military equipment within 180 days (or no later than October 26, 2022) until it receives the approval of the City Council in accordance with AB 481. Page 100 of 114 ITEM NUMBER: C-2 DATE: 04/26/22 FISCAL IMPACT: There is no direct fiscal impact from the approval of this policy or subsequent adoption of an ordinance. ATTACHMENTS: 1. Draft 2022-2023 Military Equipment Policy 2. Assembly Bill 481 Page 101 of 114 708 Military Equipment 708.1 PURPOSE AND SCOPE The purpose of this policy is to provide guidelines for the approval, acquisition, and reporting requirements of military equipment (Government Code § 7070; Government Code § 7071; Government Code § 7072). 708.1.1 DEFINITIONS Definitions related to this policy include (Government Code § 7070): Governing body – The elected or appointed body that oversees the Department, in this case the Atascadero City Council. Military equipment – Includes but is not limited to the following: 1. Unmanned, remotely piloted, powered aerial or ground vehicles. 2. Mine-resistant ambush-protected (MRAP) vehicles or armored personnel carriers. 3. High mobility multipurpose wheeled vehicles (HMMWV), two-and-one-half-ton trucks, five-ton trucks, or wheeled vehicles that have a breaching or entry apparatus attached. 4. Tracked armored vehicles that provide ballistic protection to their occupants. 5. Command and control vehicles that are either built or modified to facilitate the operational control and direction of public safety units. 6. Weaponized aircraft, vessels, or vehicles of any kind. 7. Battering rams, slugs, and breaching apparatuses that are explosive in nature. This does not include a handheld, one-person ram. 8. Firearms and ammunition of_.50 caliber or greater, excluding standard-issue shotguns and standard-issue shotgun ammunition. 9. Specialized firearms and ammunition of less than_.50 caliber, including firearms and accessories identified as assault weapons in Penal Code § 30510 and Penal Code § 30515, with the exception of standard-issue handguns. 10. Any firearm or firearm accessory that is designed to launch explosive projectiles. 11. Noise-flash diversionary devices and explosive breaching tools. 12. Munitions containing tear gas or OC, excluding standard, service-issued handheld pepper spray. 13. TASER® Shockwave, microwave weapons, water cannons, and long-range acoustic devices (LRADs). 14. Kinetic energy weapons and munitions. 15. Any other equipment as determined by a governing body or a state agency to require additional oversight. 708.2 POLICY It is the policy of the Atascadero Police Department that its members comply with the provisions of Government Code § 7071 with respect to military equipment. 708.3 MILITARY EQUIPMENT COORDINATOR The Chief of Police will designate a member of the Department to act as the military equipment coordinator. The responsibilities of the military equipment coordinator include but are not limited to: (a) Acting as liaison to the governing body for matters related to the requirements of this policy. ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 1 Page 102 of 114 (b) Identifying Department equipment that qualifies as military equipment in the current possession of the Department, or the equipment the Department intends to acquire that requires approval by the governing body. (c) Conducting an inventory of all military equipment at least annually. (d) Collaborating with any allied agency that may use military equipment within the jurisdiction of Atascadero Police Department (Government Code § 7071). (e) Preparing for, scheduling, and coordinating the annual community engagement meeting to include: 1. Publicizing the details of the meeting. 2. Preparing for public questions regarding the department’s funding, acquisition, and use of equipment. (f) Preparing the annual military equipment report for submission to the Chief of Police and ensuring that the report is made available on the Department’s website (Government Code § 7072). (g) Establishing the procedure for a person to register a complaint or concern, or how that person may submit a question about the use of a type of military equipment, and how the Department will respond in a timely manner. 708.4 MILITARY EQUIPMENT INVENTORY The attachment to this policy section constitutes a list of qualifying “military equipment” for the Department. SEE ATTACHMENT: MILITARY EQUIPMENT INVENTORY.PDF 708.5 APPROVAL The Chief of Police or his/her authorized designee shall obtain approval from the governing body, by way of an ordinance, adopting the military equipment policy. As part of the approval process, the Chief of Police or his/her authorized designee shall ensure the proposed military equipment policy is submitted to the governing body, and is available on the Department’s website at least thirty (30) days prior to any public hearing concerning the military equipment at issue (Government Code § 7071). The military equipment policy must be approved by the governing body prior to engaging in any of the following (Government Code § 7071): (a) Requesting military equipment made available pursuant to 10 USC § 2576a. (b) Seeking funds for military equipment, including but not limited to applying for a grant, soliciting or accepting private, local, state, or federal funds, in-kind donations, or other donations or transfers. (c) Acquiring military equipment either permanently or temporarily, including by borrowing or leasing. (d) Collaborating with another law enforcement agency in the deployment or other use of military equipment within the jurisdiction of this department. (e) Using any new or existing military equipment for a purpose, in a manner, or by a person not previously approved by the governing body. (f) Soliciting or responding to a proposal for, or entering into an agreement with, any other person or entity to seek funds for, apply to receive, acquire, use, or collaborate in the use of military equipment. ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 1 Page 103 of 114 (g) Acquiring military equipment through any means not provided above. 708.6 COORDINATION WITH OTHER JURISDICTIONS This policy recognizes the need for agencies to provide assistance to each other, whether in ongoing combined or regional operations, occasional planned operations, or in exigent circumstances. Where applicable to the provisions of Government Code § 7070 through § 7075, such assisting agencies must comply with their respective military equipment use policies when rendering assistance. 708.7 ANNUAL REPORT Upon approval of a military equipment policy, the Chief of Police or his/her authorized designee will submit a military equipment report to the governing body for each type of military equipment approved within one year of approval, and annually thereafter for as long as the military equipment is available for use (Government Code § 7072). The annual military equipment report shall, at a minimum, include the following information for the immediately preceding calendar year for each type of military equipment: a. A summary of how the military equipment was used and the purpose of its use. b. A summary of any complaints or concerns received concerning the military equipment. c. The results of any internal audits, any information about violations of the military equipment use policy, and any actions taken in response. d. The total annual cost for each type of military equipment, including acquisition, personnel, training, transportation, maintenance, storage, upgrade, and other ongoing costs, and from what source funds will be provided for the military equipment in the calendar year following submission of the annual military equipment report. e. The quantity possessed for each type of military equipment. f. If the law enforcement agency intends to acquire additional military equipment in the next year, the quantity sought for each type of military equipment. The Chief of Police or his/her authorized designee shall also make each annual military equipment report publicly available on the Department’s website for as long as the military equipment is available for use. The report shall include all information required by Government Code § 7072 for the preceding calendar year for each type of military equipment in department inventory. 708.8 COMMUNITY ENGAGEMENT Within 30 days of submitting and publicly releasing the annual report, the Department shall hold at least one well-publicized and conveniently located community engagement meeting, at which the Department should discuss the report and respond to public questions regarding the funding, acquisition, or use of military equipment. ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 1 Page 104 of 114 ATASCADERO POLICE DEPARTMENT POLICY MANUAL ATTACHMENT TO POLICY MANUAL SECTION 708 INVENTORY LIST OF AB 481 DEFINED MILITARY EQUIPMENT Equipment Name: 5.56mm Semi-Automatic Rifles and Ammunition - CA Govt. Code §7070(c)(10) Quantity Owned/Sought: 7 owned Lifespan: Approximately 15 years Equipment Capabilities: Semi-automatic rifles that fire a 5.56mm projectile. Manufacturer Product Description: The Colt Enhanced Patrol Rifle (EPR) M-4is the next evolution in the world's most dependable, thoroughly field-tested patrol rifle. Purpose/Authorized Uses: Officers may deploy the patrol rifle in any circumstance where the officer can articulate a reasonable expectation that the rifle may be needed. Examples of some general guidelines for deploying the patrol rifle may include but are not limited to: ● Situations where the officer reasonably anticipates an armed encounter. ● When an officer is faced with a situation that may require accurate and effective fire at long range. ● Situations where an officer reasonably expects the need to meet or exceed a suspect's firepower. ● When an officer reasonably believes that there may be a need to fire on a barricaded person or a person with a hostage. ● When an officer reasonably believes that a suspect may be wearing body armor. ● When authorized or requested by a supervisor. Fiscal Impacts: The initial cost of equipment is approximately $1,100 per rifle. The ongoing costs for ammunition vary, and maintenance is performed by Department staff. Legal/Procedural Rules Governing Use: All applicable State, Federal and Local laws governing police use of force. Various Atascadero Police Department Policies on Use of Force and Firearms including Atascadero Police Department Policy Manual sections: 300, 305, 310, 312, 314.7.3, 433. Training Required: Officers must successfully complete a CA POST certified 24-hour patrol rifle course as well as regular department firearms training and qualifications as required by law and policy. Equipment Name: 5.56mm Semi-automatic Rifles and Ammunition - CA Govt. Code §7070(c)(10) Quantity Owned/Sought: 17 owned Lifespan: Approximately 15 years Equipment Capabilities: Semi-automatic rifle capable of firing a 5.56mm projectile. Manufacturer Product Description: Bushmaster XM15-E2S Patrolman Rifle. Short barreled carbine for patrol operations Purpose/Authorized Uses: Officers may deploy the patrol rifle in any circumstance where the officer can articulate a reasonable expectation that the rifle may be needed. Examples of some general guidelines for deploying the patrol rifle may include but are not limited to: ● Situations where the officer reasonably anticipates an armed encounter. ● When an officer is faced with a situation that may require accurate and effective fire at long range. ● Situations where an officer reasonably expects the need to meet or exceed a suspect's firepower. ● When an officer reasonably believes that there may be a need to fire on a barricaded person or a person with a hostage. ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 1A Page 105 of 114 ATASCADERO POLICE DEPARTMENT POLICY MANUAL ATTACHMENT TO POLICY MANUAL SECTION 708 INVENTORY LIST OF AB 481 DEFINED MILITARY EQUIPMENT ● When an officer reasonably believes that a suspect may be wearing body armor. ● When authorized or requested by a supervisor. Fiscal Impacts: The initial cost of equipment is approximately $1,100 per rifle. The ongoing costs for ammunition vary, and maintenance is performed by Department staff. Legal/Procedural Rules Governing Use: All applicable State, Federal and Local laws governing police use of force. Various Atascadero Police Department Policies on Use of Force and Firearms including Atascadero Police Department Policy Manual sections: 300, 305, 310, 312, 314.7.3, 433. Training Required: Officers must successfully complete a CA POST certified 24-hour patrol rifle course as well as regular department firearms training and qualifications as required by law and policy. Equipment Name: 5.56mm Semi-Automatic Rifles and Ammunition - CA Govt. Code §7070(c)(10) Quantity Owned/Sought: 3 owned Lifespan: Approximately 15 years Equipment Capabilities: Semi-automatic rifles that fire a 5.56mm projectile. Manufacturer Product Description: Heckler and Koch G36C is a compact deployable patrol rifle ideal for compact carry locations such as motor vehicles and motorcycles. Purpose/Authorized Uses: Officers may deploy the patrol rifle in any circumstance where the officer can articulate a reasonable expectation that the rifle may be needed. Examples of some general guidelines for deploying the patrol rifle may include but are not limited to: ● Situations where the officer reasonably anticipates an armed encounter. ● When an officer is faced with a situation that may require accurate and effective fire at long range. ● Situations where an officer reasonably expects the need to meet or exceed a suspect's firepower. ● When an officer reasonably believes that there may be a need to fire on a barricaded person or a person with a hostage. ● When an officer reasonably believes that a suspect may be wearing body armor. ● When authorized or requested by a supervisor. Fiscal Impacts: The initial cost of equipment is approximately $1,100 per rifle. The ongoing costs for ammunition vary, and maintenance is performed by Department staff. Legal/Procedural Rules Governing Use: All applicable State, Federal and Local laws governing police use of force. Various Atascadero Police Department Policies on Use of Force and Firearms including Atascadero Police Department Policy Manual sections: 300, 305, 310, 312, 314.7.3, 433. Training Required: Officers must successfully complete a CA POST certified 24-hour patrol rifle course as well as regular department firearms training and qualifications as required by law and policy. Equipment Name: 40 caliber and 9mm Semi-Automatic Rifles and Ammunition - CA Govt. Code §7070(c)(10) Quantity Owned/Sought: 2 owned Lifespan: Approximately 15 years Equipment Capabilities: Semi-automatic rifles that fire a 40 caliber and 9mm projectile. Product Description: Heckler and Koch MP5 sub machine gun made to cover a wide variety of different tactical requirements for specialized teams. ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 1A Page 106 of 114 ATASCADERO POLICE DEPARTMENT POLICY MANUAL ATTACHMENT TO POLICY MANUAL SECTION 708 INVENTORY LIST OF AB 481 DEFINED MILITARY EQUIPMENT Purpose/Authorized Uses: Officers may deploy the patrol rifle in any circumstance where the officer can articulate a reasonable expectation that the rifle may be needed. Examples of some general guidelines for deploying the patrol rifle may include but are not limited to: ● Situations where the officer reasonably anticipates an armed encounter. ● When an officer is faced with a situation that may require accurate and effective fire at long range. ● Situations where an officer reasonably expects the need to meet or exceed a suspect's firepower. ● When an officer reasonably believes that there may be a need to fire on a barricaded person or a person with a hostage. ● When an officer reasonably believes that a suspect may be wearing body armor. ● When authorized or requested by a supervisor. Fiscal Impacts: The initial cost of equipment is approximately $1,100 per rifle. The ongoing costs for ammunition vary, and maintenance is performed by Department staff. Legal/Procedural Rules Governing Use: All applicable State, Federal and Local laws governing police use of force. Various Atascadero Police Department Policies on Use of Force and Firearms including Atascadero Police Department Policy Manual sections: 300, 305, 310, 312, 314.7.3, 433. Training Required: Officers must successfully complete a CA POST certified 24-hour patrol rifle course as well as regular department firearms training and qualifications as required by law and policy. Equipment Name: .308 caliber bolt-action Rifle and Ammunition - CA Govt. Code §7070(c)(10) Quantity Owned/Sought: 1 owned Lifespan: Approximately 15 years Equipment Capabilities: The Remington 700 Sniper Rifle fires a .308 caliber projectile at extended distances. Manufacturer Product Description: The Remington 700 is the number one bolt-action of all time, proudly made in the U.S.A. For over 50 years, more Model 700s have been sold than any other bolt- action rifle before or since. The legendary strength of its 3-rings-of-steel receiver paired with a hammer- forged barrel, combine to yield the most popular bolt-action rifle in history. Purpose/Authorized Uses: This rifle is exclusively authorized for use by a sniper-trained SWAT officer, and may be deployed in circumstances where the officer can articulate a reasonable expectation that the rifle may be necessary. Examples of some general guidelines for deploying the rifle may include but are not limited to: ● Situations where the officer reasonably anticipates an armed encounter. ● When the officer is faced with a situation that may require accurate and effective fire at long range. ● Situations where an officer reasonably expects the need to meet or exceed a suspect's firepower. ● When an officer reasonably believes that there may be a need to fire on a barricaded person or a person with a hostage. ● When an officer reasonably believes that a suspect may be wearing body armor. ● When authorized or requested by a supervisor. ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 1A Page 107 of 114 ATASCADERO POLICE DEPARTMENT POLICY MANUAL ATTACHMENT TO POLICY MANUAL SECTION 708 INVENTORY LIST OF AB 481 DEFINED MILITARY EQUIPMENT Fiscal Impacts: $1,604.12 per rifle. The ongoing costs for ammunition vary, and maintenance is performed by Department staff. Legal/Procedural Rules Governing Use: All applicable State, Federal and Local laws governing police use of force. Various Atascadero Police Department Policies on Use of Force including Atascadero Police Department Policy Manual sections 300, 305, 310, 312, 314.7.3. Training Required: In addition to patrol rifle and standard SWAT Operator training, SWAT Snipers must successfully complete a CA POST certified sniper course as well as regular SWAT Sniper training and qualifications as required by law and policy. Equipment Name: 40mm Less Lethal Launchers and Kinetic Energy Munitions - CA Govt. Code §7070(c)(14) Quantity Owned/Sought: 9 owned Lifespan: Approximately 15 years Equipment Capabilities: The 40mm Less Lethal Launcher is capable of firing 40mm Kinetic Energy Munitions. Manufacturer Product Description: Purpose/Authorized Uses: To compel an individual to cease his/her actions when such munitions present a reasonable option. A verbal warning of the intended use of the device should precede its application. The 40mm Less Lethal Launchers and Kinetic Energy Munitions are intended for use as a “less lethal” use of force option, which serves as an additional option to mitigate the possibility of using lethal force. Fiscal Impacts: $3,400 initial purchase per launcher, $2,500 initial purchase of 40mm projectiles. The ongoing cost for munitions will vary. Legal/Procedural Rules Governing Use: All applicable State, Federal and Local laws governing police use of force. Various Atascadero Police Department Policies on Use of Force, primarily Atascadero Police Department Policy Manual sections 300 and 308. Training Required: Initial orientation course including qualifications are provided by Department members who have attended a POST-certified instructor’s course; annual recertification, including qualifications by demonstrated use in a training environment are required of all operators. Equipment Name: Less lethal shotgun - CA Govt. Code §7070(c)(14) Quantity Owned/Sought: 25 owned Lifespan: Approximately 20 years Equipment Capabilities: The Model 2581 Super-sock is a less-lethal impact munition fired from a standard 12 gauge shotgun. The super-sock projectile is a fabric bag filled with lead shot. The effective range is 75 feet. Manufacturer Product Description: The Super-Sock is first in its class providing the point control accuracy and consistent energy to momentarily incapacitate violent, non-compliant subjects. The effective range is 75 feet. Purpose/Authorized Uses: To compel an individual to cease his/her actions when such munitions present a reasonable option. A verbal warning of the intended use of the device should precede its ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 1A Page 108 of 114 ATASCADERO POLICE DEPARTMENT POLICY MANUAL ATTACHMENT TO POLICY MANUAL SECTION 708 INVENTORY LIST OF AB 481 DEFINED MILITARY EQUIPMENT application. The pepperball is a “less lethal” device that affords officers with force options that are intended to mitigate the likelihood of having to use lethal force. Fiscal Impacts: The 12 gauge shotguns used to deploy the Super-Sock impact munition are re-purposed Remington 870 shotguns, taken from the Oxnard Police Department inventory. Approximately $35.50 for a box of 5 Super-Sock projectiles. The ongoing costs for ammunition will vary and maintenance is conducted by Department staff. Legal/Procedural Rules Governing Use: All applicable State, Federal and Local laws governing police use of force. Various Oxnard Police Department Policies on Use of Force including sections 300 and 308. Training Required: Initial orientation course including qualifications are provided by Department members who have attended a POST-certified instructor’s course; annual recertification including qualifications are required by all operators. ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 1A Page 109 of 114 ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 2 Page 110 of 114 ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 2 Page 111 of 114 ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 2 Page 112 of 114 ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 2 Page 113 of 114 ITEM NUMBER: C-2 DATE: 04/26/22 ATTACHMENT: 2 Page 114 of 114