Joint Sand City Council and Successor Agency of the Redevelopment Agency

MINUTES JOINT SAND CITY COUNCIL AND SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY Regular Meeting - Tuesday, December 19, 2023 5:30 PM Mayor Carbone called the meeting to order at 5:30 PM . 1. ROLL CALL Present: Staff: Mayor Carbone Vice Mayor Blackwelder Councilmember Diaz Councilmember Hawthorne Councilmember Sofer City Manager Vibeke Norgaard Police Chief David Honda Interim City Planner Zane Mortensen Interim City Attorney Adam Lindgren City Clerk Kerry Lindstrom 2. PLEDGE OF ALLEGIANCE Vice Mayor Blackwelder led the Pledge of Allegiance. 3. INVOCATION No invocation was made. 4. ANNOUNCEMENT BY MAYOR, CITY ATTORNEY, AND CITY MANAGER Mayor Carbone announced copies of the Mayor's Report and various handouts were placed on the table in the Council Chamber for the public. Mayor Carbone stated Item 9C on the agenda will be continued to the January 16, 2024 meeting. City Manager Vibeke Norgaard provided an updated City Manager's Report and made it available to the public. 5. COMMUNICATIONS No public comment was received . 6. CONSENTCALENDAR No public comment was received . Upon motion by Vice Mayor Blackwelder and seconded by Councilmember Hawthorne, Council voted to approve the Consent Calendar. Motion carried by the following vote: AYES: Mayor Carbone, Vice Mayor Blackwelder, Councilmembers Diaz,

NOES: Hawthorne, and Sofer. None. ABSENT: None. ABSTAIN : None. 6A. Approved the proposed calendar of City Council Meetings for 2024. 6B. Approved of City Donation/Contribution to the Monterey County Business Council. 6C . Approved Resolution SC 23-64 to oppose Initiative 21-0042A1 . 60 . Held second reading and adopted Ordinance SC 23-04 granting to the California-American Water Company a determinate franchise to construct, maintain, and use pipes and appurtenances, necessary or proper for transmitting water under, along, across or upon the public streets within the City of Sand City. 6E . He ld second reading and adopt Ordinance SC 23-05 adding Chapter 18.100 to the Zoning Code relating to Wireless Telecommunications Facilities setting new locational requirements and development standards. 7. CONSIDERAT ION OF ITEMS PULLED FROM CONSENT CALENDAR No items were pulled. 8. PRESENTATION BA. Received Salvation Army Impact Report Presentation from Major John Bennett No public comment received. BB. Received Code Enforcement Presentation-Discussion and Direction of Code Enforcement Priorities No public comment received . Council was provided a list of code enforcement priorities to rate from 1 to 7, with 1 being the top priority. Through Council discussion of code enforcement priorities, Council decided code enforcement should prioritize businesses operating without a conditional use permit and keeping sidewalks free of debris and oversized vehicles that block sidewalks, providing for a more safe and walkable community. BC. Received TAMC Bike Trail Presentation. 2

No public comment received. 9. NEW BUSINESS 9A. Consideration and Approval for the Cancellation of the January 2, 2024 Regular City Council Meeting No public comment received . Upon motion by Councilmember Hawthorne and seconded by Vice Mayor Blackwelder, Council voted to approve the cancellation of the January 2, 2024 Regular City Council Meeting. Motion carried 5-0, by the following vote: AYES: NOES: ABSENT: ABSTAIN : Mayor Carbone, Vice Mayor Blackwelder, Councilmembers Diaz, Hawthorne, and Sofer. None. None. None. 9B . Discussion and Direction Regarding MST Surf! Bus Impacts at the Playa Avenue and California Avenue Intersection Public comment received from Carl Sedoryk. Council received an intersection analysis on California and Playa Avenues from Rich Deal, Traffic Engineer. Four scenarios were analyzed in the analysis and Council chose scenario 3 as the best option from the intersection analysis. 9C. Approve a Resolution Approving Conditional Use Permit (CUP 23-006) for the Wonderwall Boutique Hotel at 1714 Contra Costa Street This item was continued to January 16, 2024. 10. COMMENTS BY COUNCILMEMBERS ON ITEMS OF INTEREST TO SAND CITY The Council wished everyone happy holidays. 11. ADJOURNMENT Council adjourned the meeting at approximately 7:20 PM . 3

REGULAR MEETING JOINT SAND CITY COUNCIL AND SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY TUESDAY, DECEMBER 19, 2023 5:30 PM 1

AGENDA JOINT SAND CITY COUNCIL AND SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY Regular Meeting - Tuesday, December 19, 2023 5:30 PM THIS MEETING WILL BE HELD VIRTUALLY AND IN PERSON, IS COMPLIANT WITH ASSEMBLY BILL (“AB”) 2449, SIGNED INTO LAW ON SEPTEMBER 13, 2022, WHICH AMENDS GOVERNMENT CODE SECTION 54953 TO PROVIDE AUTHORITY FOR PUBLIC AGENCIES TO CONTINUE TO HOLD VIRTUAL MEETINGS AND REMAIN IN COMPLIANCE WITH THE BROWN ACT (GOV. CODE §§ 54950 ET SEQ.). TO PARTICIPATE IN THE ZOOM COUNCIL MEETING LIVE: https://us02web.zoom.us/j/4614728829 Meeting ID: 461 472 8829 To participate telephonically by calling the number below: (669) 900-6833 Meeting ID: 461 472 8829# If prompted to enter a participant ID, press # TO PARTICIPATE IN PERSON: City Hall Council Chamber 1 Pendergrass Way Sand City, CA How to submit written Public Comments: If any member of the public would like to provide written comments at the meeting, please do as set forth below. Written: All comments received before 8:00 am the day of the meeting will be posted on the City’s website as “Correspondence” under the relevant agenda item and provided to the City Council members at the meeting. Please email your comments to: cityclerk@sandcityca.org. Read Aloud During the Meeting: Email your comments to cityclerk@sandcityca.org. When the Mayor opens the public comment period for the relevant agenda item; please indicate the agenda item and title in your email subject line. If you want your comment read aloud, prominently write “Read Aloud at Meeting” at the top of the email and your comments will be read into the record (not to exceed three minutes at staff’s cadence). DURING EACH MEETING, members of the public may participate by calling and speaking live during the designated time(s), subject to time limits that may be imposed pursuant to the 2

1. ROLL CALL 2. PLEDGE OF ALLEGIANCE 3. INVOCATION 4. ANNOUNCEMENT BY MAYOR, CITY ATTORNEY, AND CITY MANAGER 5. COMMUNICATIONS Members of the public may address the City Council/Successor Agency on matters not appearing on the City Council/Successor Agency Agenda at this time for up to three minutes. In order that the City Clerk may later identify the speaker in the minutes of the meeting, it is helpful if speakers state their names. Public comments regarding items on the scheduled agenda will be heard at the time the item is being considered by the City Council/Successor Agency. The City Council Chambers podium is equipped with a portable microphone for anyone unable to come to the podium. If you need assistance, please advise the City Clerk as to which item you would like to comment on and the microphone will be brought to you. 6. CONSENT CALENDAR The Consent Agenda consists of routine items for which City Council approval can be taken with a single motion and vote. A Council member may request that any item be placed on the Regular Agenda for separate consideration. 6A. Approve the Proposed Calendar of City Council Meetings for 2024 Staff Report Proposed Meeting Calendar 6B. Approval of City Donation/Contribution - Monterey County Business Council Memo Monterey County Business Council Letter 6C. Approve a Resolution to Oppose Initiative 21-0042A1 Staff Report Resolution Oppose Letter Summary Outline 6D. Hold Second Reading and Adopt an Ordinance Granting to the California- American Water Company a Determinate Franchise to Construct, Maintain, and Use Pipes and Appurtenances, Necessary or Proper For Transmitting Water Under, Along, Across or Upon the Public Streets Within the City of Sand City Staff Report Ordinance 6E. Hold Second Reading and Adopt an Ordinance Adding Chapter 18.100 to the Brown Act at the number provided above. Please use the "raise your hand" option on Zoom, and the City Clerk will call on your name. 3

Zoning Code Relating to Wireless Telecommunications Facilities Setting new Locational Requirements and Development Standards Staff Report Ordinance 7. CONSIDERATION OF ITEMS PULLED FROM CONSENT CALENDAR 8. PRESENTATION 8A. Salvation Army Impact Report Presentation 8B. Code Enforcement Presentation-Discussion and Direction of Code Enforcement Priorities 8C. TAMC Bike Trail Presentation 9. NEW BUSINESS 9A. Consideration and Approval for the Cancellation of the January 2, 2024 Regular City Council Meeting 9B. Discussion and Direction Regarding MST Surf! Bus Impacts at the Playa Avenue and California Avenue Intersection 9C. Approve a Resolution Approving Conditional Use Permit (CUP 23-006) for the Wonderwall Boutique Hotel at 1714 Contra Costa Street Staff Report Resolution CUP 23-006 EXHIBIT A Conditions of Approval (23-006) EXHIBIT B Findings of Approval (23-006) EXHIBIT C Location Map EXHIBIT D Aerial Map EXHIBIT E Site Plan EXHIBIT F Site Photos Exhibit G HazMat Questionnaire Exhibit H Letter of Intent 10. COMMENTS BY COUNCILMEMBERS ON ITEMS OF INTEREST TO SAND CITY 11. ADJOURNMENT The current agenda is available in PDF format on our website at: www.sandcity.org If you have a request for a disability-related modification or accommodation, including auxiliary aids or services, which will allow you to participate in a Sand City public meeting, please call the City Clerk at (831) 394-3054 extension 220, or give your written request to the City Clerk at 1 Pendergrass Way, Sand City, CA 93955 at least 48 hours prior to the scheduled meeting to allow the City Clerk time to arrange for the requested modification or accommodation. 4

REGULAR MEETING JOINT SAND CITY COUNCIL AND SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY TUESDAY, DECEMBER 19, 2023 5:30 PM 1

AGENDA JOINT SAND CITY COUNCIL AND SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY Regular Meeting - Tuesday, December 19, 2023 5:30 PM THIS MEETING WILL BE HELD VIRTUALLY AND IN PERSON, IS COMPLIANT WITH ASSEMBLY BILL (“AB”) 2449, SIGNED INTO LAW ON SEPTEMBER 13, 2022, WHICH AMENDS GOVERNMENT CODE SECTION 54953 TO PROVIDE AUTHORITY FOR PUBLIC AGENCIES TO CONTINUE TO HOLD VIRTUAL MEETINGS AND REMAIN IN COMPLIANCE WITH THE BROWN ACT (GOV. CODE §§ 54950 ET SEQ.). TO PARTICIPATE IN THE ZOOM COUNCIL MEETING LIVE: https://us02web.zoom.us/j/4614728829 Meeting ID: 461 472 8829 To participate telephonically by calling the number below: (669) 900-6833 Meeting ID: 461 472 8829# If prompted to enter a participant ID, press # TO PARTICIPATE IN PERSON: City Hall Council Chamber 1 Pendergrass Way Sand City, CA How to submit written Public Comments: If any member of the public would like to provide written comments at the meeting, please do as set forth below. Written: All comments received before 8:00 am the day of the meeting will be posted on the City’s website as “Correspondence” under the relevant agenda item and provided to the City Council members at the meeting. Please email your comments to: cityclerk@sandcityca.org. Read Aloud During the Meeting: Email your comments to cityclerk@sandcityca.org. When the Mayor opens the public comment period for the relevant agenda item; please indicate the agenda item and title in your email subject line. If you want your comment read aloud, prominently write “Read Aloud at Meeting” at the top of the email and your comments will be read into the record (not to exceed three minutes at staff’s cadence). DURING EACH MEETING, members of the public may participate by calling and speaking live during the designated time(s), subject to time limits that may be imposed pursuant to the 2

1. ROLL CALL 2. PLEDGE OF ALLEGIANCE 3. INVOCATION 4. ANNOUNCEMENT BY MAYOR, CITY ATTORNEY, AND CITY MANAGER 5. COMMUNICATIONS Members of the public may address the City Council/Successor Agency on matters not appearing on the City Council/Successor Agency Agenda at this time for up to three minutes. In order that the City Clerk may later identify the speaker in the minutes of the meeting, it is helpful if speakers state their names. Public comments regarding items on the scheduled agenda will be heard at the time the item is being considered by the City Council/Successor Agency. The City Council Chambers podium is equipped with a portable microphone for anyone unable to come to the podium. If you need assistance, please advise the City Clerk as to which item you would like to comment on and the microphone will be brought to you. 6. CONSENT CALENDAR The Consent Agenda consists of routine items for which City Council approval can be taken with a single motion and vote. A Council member may request that any item be placed on the Regular Agenda for separate consideration. 6A. Approve the Proposed Calendar of City Council Meetings for 2024 Staff Report Proposed Meeting Calendar 6B. Approval of City Donation/Contribution - Monterey County Business Council Memo Monterey County Business Council Letter 6C. Approve a Resolution to Oppose Initiative 21-0042A1 Staff Report Resolution Oppose Letter Summary Outline 6D. Hold Second Reading and Adopt an Ordinance Granting to the California- American Water Company a Determinate Franchise to Construct, Maintain, and Use Pipes and Appurtenances, Necessary or Proper For Transmitting Water Under, Along, Across or Upon the Public Streets Within the City of Sand City Staff Report Ordinance 6E. Hold Second Reading and Adopt an Ordinance Adding Chapter 18.100 to the Brown Act at the number provided above. Please use the "raise your hand" option on Zoom, and the City Clerk will call on your name. 3

Zoning Code Relating to Wireless Telecommunications Facilities Setting new Locational Requirements and Development Standards Staff Report Ordinance 7. CONSIDERATION OF ITEMS PULLED FROM CONSENT CALENDAR 8. PRESENTATION 8A. Salvation Army Impact Report Presentation 8B. Code Enforcement Presentation-Discussion and Direction of Code Enforcement Priorities 8C. TAMC Bike Trail Presentation 9. NEW BUSINESS 9A. Consideration and Approval for the Cancellation of the January 2, 2024 Regular City Council Meeting 9B. Discussion and Direction Regarding MST Surf! Bus Impacts at the Playa Avenue and California Avenue Intersection 9C. Approve a Resolution Approving Conditional Use Permit (CUP 23-006) for the Wonderwall Boutique Hotel at 1714 Contra Costa Street Staff Report Resolution CUP 23-006 EXHIBIT A Conditions of Approval (23-006) EXHIBIT B Findings of Approval (23-006) EXHIBIT C Location Map EXHIBIT D Aerial Map EXHIBIT E Site Plan EXHIBIT F Site Photos Exhibit G HazMat Questionnaire Exhibit H Letter of Intent 10. COMMENTS BY COUNCILMEMBERS ON ITEMS OF INTEREST TO SAND CITY 11. ADJOURNMENT The current agenda is available in PDF format on our website at: www.sandcity.org If you have a request for a disability-related modification or accommodation, including auxiliary aids or services, which will allow you to participate in a Sand City public meeting, please call the City Clerk at (831) 394-3054 extension 220, or give your written request to the City Clerk at 1 Pendergrass Way, Sand City, CA 93955 at least 48 hours prior to the scheduled meeting to allow the City Clerk time to arrange for the requested modification or accommodation. 4

AGENDA ITEM 6A. Approve the Proposed Calendar of City Council Meetings for 2024 5

City of Sand City STAFF REPORT TO: Honorable Mayor and City Council FROM: Kerry Lindstrom, City Clerk SUBJECT: Proposed Calendar of City Council Meetings for 2024 DATE: December 19, 2023 _______________________________________________________________________ BACKGROUND/DISCUSSION: On November 7, 2023, the City Council directed staff to prepare a master calendar of City Council meetings in 2024. Sand City Municipal Code Chapter 2.04 states that the Council and Successor Agency meet regularly on the first and third Tuesdays of every month but that Council has discretion to adjust this schedule by adjourning some of the meetings. (SCMC section 2.04.010). The attached proposed calendar provides for City Council meetings on the first and third Tuesdays of the month with some exceptions. In keeping with past practice due to holidays and the California League of Cities annual conference, several meetings are proposed to be cancelled as indicated on the calendar. Staff will update the calendar in the event of the cancellation of an additional council meeting, approved by Council. If approved, the calendar will be posted on the City’s website. CEQA: This action does not constitute a "project" as defined by the California Environmental Quality Act (CEQA) guidelines section 15378. FISCAL IMPACT: None – while there is a cost savings to the City when a Council meeting is cancelled due to less time spent by outside consultants attending several meetings in a month, the cancellations proposed are in line with the City’s past practice and thus do not reflect a change that has a financial impact. RECOMMENDATION: Adopt the proposed calendar of City Council Meetings for 2024. ATTACHMENTS: 1. 2024 Meeting Calendar 6

Sand City Calendar 2024 January 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 February 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 March 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 April 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 May 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 June 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 July 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 August 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 September 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 October 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 November 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 December 2024 S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 City Council Regular Meetings – First and Third Tuesdays of the Month Public Safety Committee - Second Tuesday of March, June, September, and December City Barbecue – May 18, 2024 West End Celebration – August 24-25, 2024 Tree Lighting Ceremony – December 6, 2024 Canceled City Council Meetings 7

AGENDA ITEM 6B. Approval of City Donation/Contribution - Monterey County Business Council 8

Memo To: Honorable Mayor and City Council From: Vibeke Norgaard, City Manager Date: December 19, 2023 Re: Review of City Donation/Contribution Attached is a request for support and contribution for the fiscal year 2023-24. After reviewing this request, the following donation is recommended:  Monterey County Business Council - $5000.00 If any Councilmember wants to discuss this request or to propose a different contribution, then this item should be pulled from the consent calendar for discussion with the full Council. 9

2 The following finding is specified in the annual City/Successor Agency Budget: “The City council finds that it is a valid public purpose and in the best interest of the small city to support and participate in various community programs and activities of the larger Monterey Peninsula area. This support includes not only the City’s financial contributions outlined in the attached pages but also the active involvement/participation by councilmembers, city staff, Sand City businesses, and citizens. This Sand City’s pledge and commitment of support for the larger regional community in which it is an active and dedicated member.” 10

Overview The Small Business Development Center (SBDC) is a federal, Small Business Administration (SBA) funded program to assist small businesses with resources necessary to be successful. This includes creating business plans, assistance with human resources, access to capital to ensure business owners are creating a solid foundation for their company, and more. Over the last 12 months, SBDC has assisted 839 local businesses in Monterey County. The SBDC is currently hosted by Cal Coastal (a financial institution) through U.C. Merced (UCM), who manages multiple SBDC’s for the Small Business Administration throughout California. Cal Coastal notified U.C. Merced in October that they are opting not to renew their agreement with UCM for the SBDC designation. The Request for Proposals to host the SBDC was released at the end of October, with a tight deadline to apply by December 15th, 2023. The current SBDC and Monterey County Business Council (MCBC) have worked collaboratively for years, referring business owners back and forth to each other based on the needs of the companies. MCBC has been working in partnership with the County of Monterey to assist businesses recover from the pandemic - the entirely bilingual staff at MCBC is active in all areas of the county, both in seminars and on foot, engaging businesses. The opportunity to expand those SBDC services to MCBC is a seamless progression for MCBC. Plan If selected as the host, Monterey County Business Council plans to run the SBDC a little differently than its current setup---requesting partnerships with the City of Soledad and City of Monterey for satellite offices in South County and Monterey Peninsula, in addition to the home base office in Salinas. This allows business owners to have access to the SBDC services in their area without traveling to Salinas, which is currently the only location. There is also a plan to expand outreach to South County and Monterey Peninsula, to ensure the assistance to those areas increases dramatically. MCBC currently has bilingual staff, expertly trained in outreach and assistance to businesses – the progression of working as the SBDC is a natural fit. Funding MCBC is currently the only local agency applying for the designation. MCBC recognizes the need for the SBDC, and understands if no one applies, Monterey County loses the Small Business 11

Development Center entirely. There is a local match requirement of $120,000 for the $400K federal SBA Small Business Development Center (SBDC) program. There is CA GoBiz (Technical Assistance Program) funding available that MCBC plans to apply for in 2024 (the current SBDC has it), but with one month to submit the RFP, MCBC is unable to secure it from the state for the RFP application. The requirement for funding is promissory for the RFP – the local match would only be required if MCBC is awarded the designation. MCBC has secured $10,000 from the City of Monterey and a satellite location in Monterey and is currently asking for financial commitments from multiple cities. We have confirmation of the following: County of Monterey - $64,000 – confirmed Monterey - $10K and satellite office - confirmed Carmel - $5K - confirmed King City - $5K - confirmed Gonzales- $5K – confirmed Marina - $5K – confirmed Seaside - $5K confirmed Soledad - $10K and satellite office (going to council for approval on 12/5) Greenfield - $5K (going to council for approval on 12/12) We are contacting and sending a template staff report with the funding request to: Sand City - $5K (requested to add to next council meeting) Pacific Grove- $5K (requested to add to next meeting) Del Rey Oaks - $5K (requested to add to next council meeting) Request MCBC is respectfully requesting $5,000 from Sand City towards the local match requirement. We also recognize the variance in size of cities and their respective budgets in Monterey County, so we understand if Sand City cannot meet the $5K amount---but would ask for participation at some level to show the commitment from all cities. The match would be contingent upon the SBA grant being awarded to Monterey County Business Council. *** 12

AGENDA ITEM 6C. Approve a Resolution to Oppose Initiative 21-0042A1 13

MEMO TO: City Council FROM: Mayor Carbone SUBJECT: Initiative No. 21-0042A1, The Taxpayer Protection and Government Accountability Act DATE: December 19, 2023 _______________________________________________________________________ BACKGROUND/DISCUSSION: I. SUMMARY The Taxpayer Protection and Government Accountability Act would amend the California Constitution with provisions that limit voters’ authority and input, adopt new and stricter rules for raising taxes and fees, and may make it more difficult to impose fines and penalties for violation of state and local laws. The measure puts billions of local government tax and fee revenues at risk statewide with related core public service impacts. The measure would have significant negative impacts on City of Sand City operations and core service delivery. The proposed constitutional initiative is sponsored by the California Business Roundtable. II. MAJOR PROVISIONS Fees and Charges 1:  Except for licensing and other regulatory fees, fees and charges may not exceed the “actual cost” of providing the product or service for which the fee is charged. “Actual cost” is the “minimum amount necessary.” The burden to prove the fee or charge does not exceed “actual cost” is changed to “clear and convincing” evidence.  Requires fees and charges paid for the use of local and state government property and the amount paid to purchase or rent government property to be “reasonable.” These fees and charges are currently allowed to be market-based. Whether the amount is “reasonable” (introducing a new legal standard aiming to force below market fee and charge amounts) must be proved by “clear and convincing evidence.”2 The standard may significantly reduce the amount large companies 1 Initiative No. 21-0042A1 (pgs.4-6; Section 1 (a)-(j) 2 Initiative No. 21-0042A1 (pg.5; (3)) 14

(e.g., oil, utilities, gas, railroads, garbage/refuse, cable, and other corporations) will pay for the use of local public property.  Prohibits fees on new development based on vehicle miles traveled. Taxes3:  Taxes and fees adopted after Jan. 1, 2022, that do not comply with the new rules, are void unless reenacted 4.  Invalidates Upland decision that allows a majority of local voters to pass special taxes. The measure specifies that taxes proposed by the initiative are subject to the same rules as taxes placed on the ballot by a city council.  Expressly prohibits local advisory measures which allow local voters to express a preference for how local general tax dollars should be spent. 5  Requires voter approval to expand existing taxes (e.g., Utility, Transient Occupancy) to new territory (e.g., annexations) or to expand the tax base (e.g., new utility service)  New taxes can only be imposed for a specific time period.  City charters may not be amended to include a tax or fee.  All state taxes require majority voter approval. Fines and Penalties6:  May require voter approval of fines, penalties, and levies for corporations and property owners that violate state and local laws unless a new, undefined adjudicatory process is used to impose the fines and penalties. III. DISCUSSION/ADDITIONAL BACKGROUND On Jan. 4, 2022, the California Business Roundtable filed the “Taxpayer Protection and Government Accountability Act” or AG# 21-0042A1. On Feb. 1, 2023, the measure qualified for the November 2024 ballot. The League of California Cities, along with a broad coalition of local governments, labor and public safety leaders, infrastructure advocates, and businesses, strongly opposes this initiative. 3 Initiative No. 21-0042A1 (pgs.4-6; Section 1 (a)-(j) 4 Initiative No. 21-0042A1 (pg.7; Section 6 (Sec. 2)(g) 5 Initiative No. 21-0042A1 (pg.6 (3)) 6 Initiative No. 21-0042A1 (pg. 5 (4)) 15

Local government revenue-raising authority is currently substantially restricted by state statute and constitutional provisions, including the voter approved provisions of Proposition 13 of 1978, Proposition 218 of 1996, and Proposition 26 of 2010. The Taxpayer Protection and Government Accountability Act adds and expands restrictions on voters and local government tax and fee authority. Fees and Taxes Local governments levy a variety of fees and other charges to provide core public services. Major examples of affected fees and charges are:  Nuisance abatement charges, such as for weed, rubbish, and general nuisance abatement to fund community safety, code enforcement, and neighborhood cleanup programs.  Commercial franchise fees.  Emergency response fees, such as in connection with DUI.  Advanced Life Support (ALS) transport charges.  Document processing and duplication fees.  Transit fees, tolls, parking fees, and public airport and harbor use fees.  Facility use charges, fees for parks and recreation services, garbage disposal tipping fees. Virtually every city, county, and special district must regularly (e.g., annually) adopt increases to fee rates and charges and revise rate schedules to accommodate new users and activities. Most of these would be subject to new standards and limitations under threat of legal challenge. Based on the current volume of fees and charges imposed by local agencies, including council-adopted increases to simply accommodate inflation, Cal Cities estimates the amount of local government fee and charge revenue at risk is approximately $2 billion per year including those adopted since Jan. 1, 2022. Over ten years, $20 billion of local government fee and charge revenues will be at heightened legal peril. Hundreds of local tax measures were approved in 20227 that likely do not comply with the provisions of the initiative. Nearly $2 billion of annual revenues from these voter-approved measures will cease a year after the effective date of the measure, reducing the local public services funded by these measures, unless the tax is re-submitted for voter approval. Reductions on local government tax revenues have impacts on core services and infrastructure including fire and emergency response, law enforcement, streets and roads, drinking water, sewer sanitation, parks, libraries, public schools, affordable housing, homelessness prevention, and mental health services. Fines and Penalties 7 http://www.californiacityfinance.com/Votes2211final.pdf 16

Under existing law, cities are required to provide due process before imposing a penalty or fine for violation of its municipal code: 1. A local agency must adopt administrative procedures that govern imposing fines and penalties, including providing a reasonable period of time for a person responsible for a continuing violation to correct or remedy the violation [Gov't Code 53069.4]. 2. Notice must be given to the violating party before imposing the penalty; and give the party an opportunity to be heard and present any facts or arguments [Merco Construction Engineers v. Los Angeles Unified School District (1969) 274 CA 2d 154, 166]. 3. The fine may not be "excessive" [U.S. Constitution amendments VIII and XIV]. The initiative converts administratively-imposed fines and penalties into taxes unless a new, undefined, and ambiguous “adjudicatory due process” is followed. This provision may put at risk authority to impose fines and penalties for violations of state and local law. The Taxpayer Protection and Government Accountability Act will take billions of dollars away from local government services statewide. RECOMMENDATION: The Mayor recommends that the Council adopt a Resolution opposing Initiative No. 21- 0042A1, the Taxpayer Protection and Government Accountability Act. ATTACHMENTS: CBRT Resolution CBRT Oppose Letter CBRT Summary Outline 17

CITY OF SAND CITY RESOLUTION SC ___, 2023 RESOLUTION OF THE CITY COUNCIL OF SAND CITY TO OPPOSE INITIATIVE 21- 0042A1 WHEREAS, the “Taxpayer Protection and Government Accountability Act,” (Initiative 21- 0042A) a statewide initiative measure to amend the California Constitution sponsored by the California Business Roundtable (“CBRT”) would limit the ability of the local governments to enact, modify, or expand taxes, assessments, fees, and property-related charges; and WHEREAS, Initiative 21-0042A1 includes provisions that would make it more difficult for local voters to pass measures needed to fund local services and infrastructure, and would limit voter input by prohibiting local advisory measures where voters provide direction on how they want their local tax dollars spent; and WHEREAS, the measure may make it much more difficult for state and local regulators to issue fines and levies on corporations that violate laws intended to protect our environment, public health and safety, and our neighborhoods; and WHEREAS, The initiative includes provisions that would retroactively void all state and local taxes or fees adopted after January 1, 2022 if they did not align with the provisions of the Initiative; and WHEREAS, the measure puts billions of dollars currently dedicated to local services at risk and could force cuts to fire and emergency response, law enforcement, public health, parks, libraries, affordable housing, services to support homeless residents, mental health services. THEREFORE, BE IT RESOLVED that the City of Sand City opposes Initiative 21-0042A1; PASSED AND ADOPTED by the City Council of the City of Sand City this ___, day of _____, 2023 by the following vote: AYES: NOES: ABSENT: ABSTAIN: APPROVED: ___________________________ Mary Ann Carbone, Mayor ATTEST: DATED: ____________________ 18

______________