March 24, 2015 Council Packet

AGENDA

CITY OF SANTA MONICA

REGULAR CITY COUNCIL MEETING AGENDA

(REGULAR MEETING OF THE REDEVELOPMENT

SUCCESSOR AGENCY CANCELLED)

CITY HALL COUNCIL CHAMBERS - 1685 MAIN STREET

TUESDAY, MARCH 24, 2015

MEETING BEGINS AT 5:30 P.M.

CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL

(Please note that Agenda Items may be reordered during the Council meeting at the discretion of the City Council.)

1. CLOSED SESSIONS:

1-A: Conference with Real Property Negotiator: Property: 3100 Neilson (recorded as 3275 Barnard Way) City Negotiators: Andy Agle, Director of Housing and Economic Dev. Barbara Collins, Housing Manager Under Negotiation: Terms of Affordability Covenant Owner of Record: Neilson Villa

1-B: Conference with Legal Counsel – Anticipated Litigation: Anticipate significant exposure to litigation pursuant to Government Code Section 54956.9 (d)(2) – 1 case: 1) Claim of Dunn and Robhana 1-C: Conference with Legal Counsel – Anticipated Litigation: Anticipate significant exposure to litigation pursuant to Government Code Section 54956.9(d)(2) – 1 case

The following is the order of business for items to be heard no earlier than 6:30 p.m.

3. CONSENT CALENDAR: (All items will be considered and approved in one motion unless removed by a Councilmember for discussion.)

3-A: Verizon Store License Agreement - recommendation to authorize the City Manager to negotiate and execute a limited-term license agreement with Verizon Wireless for a term of 21 years to grant the use of a small portion of the public right-of-way for a façade feature at 1322 Third Street and charge an annual fee of $1,020 with an escalator of 10 percent every five years.

STAFF REPORT 1 March 24, 2015 3-B: Amendments to Downtown Leasing and Licensing Guidelines – recommendation that the City Council approve proposed amendments to the Downtown Santa Monica Leasing and Licensing Guidelines for the purpose of updating and clarifying various sections of the Guidelines due to changes in space programming, tenancy, and proposed preferred-use enhancements.

STAFF REPORT

3-C: Beach Bike Trail Sweeping – recommendation to authorize the City Manager to negotiate and execute a cooperation agreement with LA County for the City to sweep the Beach Bike Trail within Santa Monica, whereby the County would reimburse the City $30,000 annually, adjusted by the Consumer Price Index (CPI), authorize the Purchasing Services Manager to issue a purchase order with Tennant Company for one heavy-duty outdoor sweeper, which would be a sole source purchase in an amount not to exceed $199,540, and appropriate budget changes.

STAFF REPORT

3-D: Amendment to the Strategic Prevention Framework – State Incentive Grant – recommendation to authorize the City Manager to negotiate and execute an amendment to the Strategic Prevention Framework – State Incentive Grant in the amount of $9,600 for a total amount of $57,600, and authorize changes.

STAFF REPORT

3-E: Second Modification to Professional Services Agreement for Web Development and Content Management Services – recommendation to authorize the City Manager to negotiate and execute a second modification to professional services agreement #2221 in the amount of $15,000 with John Oakes, to provide web development and content management services resulting in a four year amended agreement with a new total amount not to exceed $95,000.

STAFF REPORT

3-F: Professional Services Agreement for Transportation and Parking Services (TAPS) Center Tenant Improvement Project at Parking Structure No. 5 – recommendation to award Request for Proposals (RFP) SP#2363 to Studio Jantzen, an architectural design firm, to provide design services for the Transportation and Parking Services Center (TAPS) Tenant Improvement project located on the ground floor of the Parking Structure No. 5, authorize the City Manager to negotiate and execute a professional services agreement with Studio Janzen in an amount not to exceed $252,698, and authorize budget changes.

STAFF REPORT

2 March 24, 2015 3-G: Low Carbon Transit Options Program Resolution – recommendation that the City Council adopt the attached resolution for the Low Carbon Transit Operations Program, which was created to provide assistance for transit agencies to reduce greenhouse gas emissions and improve mobility.

STAFF REPORT

3-H: Resolution Approving the Final Tract Map No. 60419 for a 10-Unit Condominum Project at 1803 16th Street.

STAFF REPORT

REGULAR MEETING OF THE REDEVELOPMENT SUCCESSOR AGENCY

ROLL CALL

3-G: Canceled, if no business to consider.

ADJOURNMENT

7. ORDINANCES: (Public comment is permitted on ordinances for introduction and first reading. No public discussion is permitted on ordinances for second reading and adoption.)

7-A: Second reading and Adoption of an Ordinance adding Section 4.04.162 to the Santa Monica Municipal Code prohibiting certain animals from the Beach, Ocean Front Walk, the Pier and Pier ramp, the Third Street Promenade, the Downtown Transit Mall, and all City parks and adjacent sidewalks.

STAFF REPORT

7-B: Second reading and Adoption of an Ordinance reducing the membership of the Arts Commission from thirteen to eleven members.

STAFF REPORT

7-C: Second reading and Adoption of an Ordinance Adopting Local Modifications to the Requirements of the Property and Business Improvement District Law of 1994 to reinstate a 40-percent-minimum Petition Threshold for Consideration of Establishing a Property or Business Improvement District.

STAFF REPORT

8. STAFF ADMINISTRATIVE ITEMS:

8-A: The Santa Monica Airport And Future Options Regarding Its Operations And The City's Use Of The Land Now Occupied By The Airport - recommendation that the City Council review and comment on future options regarding operation of the Santa Monica Airport ("Airport" or "SMO") and the City's future use of its land currently occupied by the Airport and direct staff to: 1.continue with a full range of planning, environmental and legal work that would enable the City to determine the future use of the City's land, including possible closure of all or part of the Airport; such work to include, but not be limited to, pursuing legal resolution of issues relating to control of the land, undertaking preliminary

3 March 24, 2015 to both the western parcel and the entire Airport, and assessing the possibility of a City- sponsored 2016 ballot measure; 2. continue to implement measures to reduce adverse impacts of Airport operations, through imposing appropriate conditions in leases and any other lawful means; 3. continue to promote Airport self-sufficiency to ensure that the Airport is not a drain on the general fund during this period of possible transition, including by: increasing any rents that may not be at market rate; renegotiating for Council approval expired master leases to address subleasing and thereby provide for the City's receipt of full revenues from the use of City property; and obtaining private assistance with leasing and property management; 4. work to reduce and eliminate aviation uses of the land released from aviation use; 5. negotiate and execute new leases with two current non-aviation subtenants (VW-Audi and Milstein), The Museum of Flying, Atlantic Aviation, and Krueger Aviation with lease terms expiring either three years from execution or by June 30, 2018, whichever date is earlier; and 6. continue to receive, assess and provide recommendations based on community input on all aspects of Airport operations and use of the land now occupied by the Airport.

STAFF REPORT

9. PUBLIC HEARINGS:

9-A: Big Blue Bus/Expo Service Integration Plan Public Hearing and Adoption of Service Plan – recommendation that the City Council hold a public hearing, receive public comment, and approve the revised Big Blue Bus operating plan for new and restructured BBB routes and schedules that will provide seamless integration with Expo Light Rail at the stations in the BBB service area. (Staff will request that the Council hear this item on 4/28.) STAFF REPORT

13. COUNCILMEMBER DISCUSSION ITEMS:

13-A: Recommendation to accept Kevin Daly’s resignation from the Architectural Review Board and authorize the City Clerk to publish the vacancy.

13-B: Recommendation to accept David Fetterman’s resignation from the Clean Beaches & Ocean Parcel Tax Citizens Oversight Committee and authorize the City Clerk to publish the vacancy.

13-C: Appointment to one unscheduled vacancy on the Planning Commission for a term ending on June 30, 2015. (Continued from the March 17, 2015 meeting)

13-D: Appointment to one unscheduled vacancy on the Commission on the Status of Women for a term ending on June 30, 2015. (Continued from the March 17, 2015 meeting)

4 March 24, 2015 14. PUBLIC INPUT: (Public comment is permitted only on items not on the agenda that are within the subject matter jurisdiction of the City. State law prohibits the City Council from taking any action on items not listed on the agenda, including issues raised under this agenda item.)

ADJOURNMENT.

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Parking is available in front of City Hall and on Olympic Drive and in the Civic Center Parking Structure (validation free).

5 March 24, 2015 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 3-A To: Mayor and City Council From: Andy Agle, Director of Housing and Economic Development Subject: Verizon Store License Agreement

Recommended Action Staff recommends that the Council authorize the City Manager to negotiate and execute a limited-term license agreement with Verizon Wireless, a New York-based company, for a term of 21 years to grant the use of a small portion of the public right-of-way for a façade feature at 1322 Third Street and charge an annual fee of $1,020 with an escalator of 10 percent every five years.

Executive Summary

The Architectural Review Board (ARB) has approved a storefront façade and sign plan for a new retail tenant, Verizon Wireless, at 1322 Third Street Promenade. The building is listed on the City's Historic Resources Inventory. The ARB approval includes a minor encroachment of 24 feet into the public right-of-way at 1322 Third Street Promenade in order to allow for a new façade treatment to protectively cover the historic façade. The Public Works Department has approved the encroachment into the public right-of-way. In order to facilitate the encroachment condition, Verizon is required to enter into a limited-term license agreement and pay an annual fee of $1,020 with an escalator. The 21-year period would coincide with Verizon’s lease at 1322 Third Street Promenade.

Discussion Verizon Wireless (Verizon) will be opening a new retail store at 1322 Third Street Promenade (see Attachment A). The building is listed on the City’s Historic Resources Inventory as a contributor to a potential district. Verizon submitted an application before the Architectural Review Board (ARB) for approval of building design, colors, materials, and signs (Attachment B). The ARB approved the application at a public hearing on January 5, 2015, subject to conditions. The staff report's analysis stated, in part, that: "The façade design is intended to provide a contemporary retail identity along the 1 ground floor façade while respecting the integrity of the multi-tenant building listed on the City's Historic Resources Inventory."

Verizon’s approved retail façade will extend into the public right-of-way, encompassing a total area of 24 square feet (each area is one-foot wide by twelve-feet long at the base of the building façade, on either side of the entrance door). The use of the public right- of-way as proposed has been approved by the Public Works Department. If the proposed terms and authorization to enter into the license Agreement are approved, construction of the new façade would begin in late spring 2015.

The license agreement is proposed for the specific purpose of protecting a historic resource. Verizon proposes to retain the original historic façade underneath a new façade treatment that is reflective of the company’s image and branding. A license agreement is required because the new façade treatment would extend one-foot into the public right-of-way. In the event the façade is removed, the license agreement would be terminated. Similarly, if the façade is significantly altered, a new license agreement would need to be considered.

The proposed surface license fee of $1,020 annually would increase by ten percent every five years. Staff recommends a license Agreement term of 21 years to coincide with Verizon’s lease term for the property. In addition to specifying the fee amount and term, the license agreement would contain maintenance and insurance requirements and preserve existing rights of entry for the City. A security deposit would also be required in the event the City needs to remove the improvements.

In determining value for the proposed license agreement, staff reviewed the license terms and appraisal methodology used for valuing the license agreements and use of public right-of-way for two other businesses: King’s Seafood (now “The Water Grill”) at 1401 Ocean Avenue and the Travelodge Hotel (now known as “The Shore Hotel”) located at 1515-1525 Ocean Avenue and 1530 Second Street, respectively. The King’s Seafood agreement, which granted use of 490 square feet on the public right-of-way on

2 Ocean Avenue for purposes of accommodating ADA access and landscaping treatment, was approved by Council on February 26, 2013. The term of the license is ten years with two five-year options. The Travelodge agreement, which granted the use of a subsurface right-of-way for a utility easement and air rights for a pedestrian bridge over First Court Alley, was approved by Council on December 8, 2009 and has a term of seventy-five years due to the extensive subterranean and above-grade construction required of the development.

In both cases, the value of the license area is derived from an appraisal of the public right-of-way value based on the fair market value of the property, with a discount applied due to use restrictions, limitations, and encumbrances associated with the rights-of-way. Staff used an appraisal produced for the City by Buss-Shelger Associates dated February 9, 2015. A discounted land value of $567 per square foot was determined based on recent comparable land values in the area with a twenty-percent discount applied due to development limitations. The appraiser calculated an annual ground lease payment based on the proposed license area.

Environmental Analysis The proposed project is exempt from CEQA pursuant to Section 15061 (b) (3).

3 Financial Impacts & Budget Actions Authorizing the execution of the license Agreement would generate an annual fee of $1,020 with a 10 percent increase every five years. Revenues would be received beginning in FY 2015-16 and deposited into account 01263.409250. The appraisal cost would be reimbursed by Verizon.

Prepared by: Jennifer Taylor, Economic Development Administrator

Approved: Forwarded to Council:

Andy Agle, Director Elaine M. Polachek Housing and Economic Development Interim City Manager

Attachments:

A: 1322 Third Street Promenade Site Plan B: 1322 Third Street Promenade Store Design Plan

City Council Report

City Council Meeting: March 24, 2015

Agenda Item: 3-B

To: Mayor and City Council

From: Andy Agle, Director of Housing and Economic Development

Subject: Amendments to Downtown Leasing and Licensing Guidelines

Recommended Action Staff recommends that the City Council approve the attached proposed amendments to the Downtown Leasing and Licensing Guidelines which update and clarify various sections.

Executive Summary Staff recommends amendments to the Downtown Leasing and Licensing Guidelines for the purpose of updating the inventory of leased spaces, clarifying credits for tenant improvements, and correcting an error in a previous version.

Background The Downtown Leasing and Licensing Guidelines (Guidelines) set forth the objectives, preferred uses, and procedures related to leasing and licensing City-owned properties and public rights-of-way located within the Downtown district, generally bounded by 7th Street to the east, Wilshire Boulevard to the north, Ocean Avenue to the west, and the Santa Monica freeway to the south. In addition, the Guidelines provide an inventory of City-owned spaces that are subject to the Guidelines. Periodically, the Guidelines are amended to reflect changes in the City’s properties, policies, or space programming. The Guidelines were last updated on March 19, 2013.

Discussion There have been changes to City-owned spaces since the Guidelines were last amended, necessitating an update to inventory. In addition, staff recommends that the

1 Guidelines provide clear guidance regarding rent credits for tenant improvements. Finally, a recommended update would correct an inadvertent error from the last time the Guidelines were updated. The recommended amendments are summarized below with reference to the applicable sections in the Guidelines:

Section I. Preferred Uses C. Parking Structure Leased Premises Parking Structure No. 5 (1440 - 1454 Fourth Street): The available space and preferred use for the facility is recommended to be updated to reflect the anticipated construction of a one-stop Transit and Parking Services (TAPS) Center, included in the adopted FY 14/15 capital improvement program. The TAPS project would centralize operations of the Big Blue Bus Transit Store, the City’s parking office and the administrative office of the City’s parking contractor and would include new public restrooms. The amended guidelines will show that approximately 500 square feet would be available to accommodate commercial retail uses, which would be subject to the tenant recruitment process outlined in the Guidelines.

Parking Structure No. 6 (1431 Second Street): An update to the property description is recommended to reflect construction completion in December 2013 and execution of three tenant leases in 2014. In addition, approximately 890 square feet of bicycle storage and service space has been included in the Guidelines as available for tenant recruitment. Staff recommends deleting reference to storage space as it is being used for non-commercial purposes.

Section VIII. Facility Condition Staff recommends that additional language be included in the Guidelines to address when rent credits can be negotiated. Specifically, the proposed Guidelines would allow the City to negotiate rent credits when a tenant is required to invest private funds to convert a City-owned property from a cold-shell condition to code-standard condition.

Section XI. Delegation of Authority The recommended change would correct an inadvertent error associated with Council’s previous approval of the Guidelines. For over a decade, the Guidelines have delegated authority to negotiate leases and licenses to the City Manager, pursuant to a favorable recommendation of the DTSM Board of Directors, as adopted on July 8, 2003. The most recent amendment to the Guidelines on March 9, 2013 inadvertently returned authority to Council. The correction would reinstate the delegation of authority to the DTSM Board and City Manager.

2 Appendix A: Licensees as of February 28, 2015 The appendix provides an inventory of the City-owned properties and public rights-of-way located within the Downtown District that are available for leasing and licensing, as well as associated leases and license agreements. As discussed above, the following two properties have been included in the appendix and would be available to lease or license in 2015:

• 1431 Second Street (890 sq. ft.) – Bicycle Parking and Services • 1440 Fourth Street (500 sq. ft.) – Commercial Retail

The proposed amendments are incorporated in Attachment A. The amendments would supersede the previous Leasing Guidelines and would become effective upon the date of approval by Council. Attachment B provides the existing Guidelines with the proposed changes redlined for reference. Staff worked with DTSM staff on preparing the proposed updates and coordinates with DTSM on the application of the Guidelines.

Financial Impacts & Budget Actions There is no immediate financial impact or budget action necessary as a result of amending the Guidelines.

Prepared by: Nia Tang, Senior Development Analyst

Approved: Forwarded to Council:

Andy Agle, Director Elaine M. Polachek Housing and Economic Development Interim City Manager

ATTACHMENTS: Attachment A: Downtown Santa Monica Leasing and Licensing Guidelines - Clean Attachment B: Downtown Santa Monica Leasing and Licensing Guidelines - Redlined

3 Attachment A

DOWNTOWN SANTA MONICA LEASING AND LICENSING GUIDELINES

Adopted July 8, 2003 Amended April10, 2007 Amended June 24, 2008 Amended March 19, 2013 Proposed Amendments March 24, 2015 TABLE OF CONTENTS

GUIDELINE OBJECTIVES ...... 3 I. PREFERRED USES ...... 3 A. Center Court ...... 3 B. Pavilions ...... 4 C. Parking Structure Leased Premises ...... 4 D. Vending Cart License...... 5 E. Temporary Licenses/Other ...... 6 II. PREFERENCE FOR LOCAL, INDEPENDENT, AND NON-FORMULA BUSINESSES ...... 6 Ill. LEASE TERMS, OPTIONS AND RENEWALS ...... 6 IV. DIVERSITY OF TENANCIES ...... 7 V. LABOR PEACE ...... 7 VI. SUSTAINABLE BUSINESS PRACTICES ...... 7 VII. PERIODIC REVIEW OF RENTAL RATES ...... 8 VIII. FACILITY CONDITION ...... 8 IX. TENANCY RELATIONSHIPS ...... 8 X. EVALUATION CRITERIA ...... 10 XI. DELEGATION OF AUTHORITY ...... 10 APPENDIX A: LICENSEES AS OF FEBRUARY 28, 2015 ...... 11

GUIDELINE OBJECTIVES

The purpose of the Downtown Leasing and Licensing Guidelines is to establish the type and nature of private uses that the City of Santa Monica ("City") and Downtown Santa Monica, Inc. ("DTSM”) seek for the leasing and licensing opportunities that are available within the City's public facilities within the downtown district. Given that the leasing and licensing opportunities are limited, the City and DTSM seek to encourage and support the success of independent, non-formula entrepreneurs who will offer the public quality service and value. The designated uses and processes for selecting lessees and licensees are intended to maintain the compatibility of use of City-owned properties and public right-of-ways located within the downtown district for purposes which contribute to pedestrian orientation, outdoor dining, and neighborhood residential services; establish and implement procedures for managing and preserving the Preferred Uses of City-owned properties and rights-of-way; and assure access and use of these public properties by the general public for the Preferred Uses through a leasing and licensing program that promotes orderly and periodic changes in tenancy at fair market rates.

The DTSM boundaries are 7th Street to the east, Wilshire to the north, Ocean Avenue to the west, and the Santa Monica freeway to the south. The following locations are exempt from the oversight of DTSM: City of Santa Monica’s Big Blue Bus (“BBB”), Ken Edwards Center, Expo Light Rail station (“Expo”) at 4th and Colorado, Santa Monica Main Library, the 4th and Arizona development site, and Samoshel and Shwashlock at 503 and 505 Olympic. Any City-owned properties requiring a Development Agreement are also exempt from the requirements of these Guidelines. From time to time, this list may be amended by the parties.

I. PREFERRED USES

Current uses of City-owned structures and right-of-ways in the downtown district are diverse, and have been intended to enhance the downtown district experience, support purposes that serve broader neighborhood community interests, and provide for the needs of downtown district residents and business owners as well as tourists. Diversity is maintained through commercial activities providing services that are otherwise unavailable to visitors and neighborhood residents in the downtown district, and educational and recreational opportunities for otherwise underserved segments of the community. In addition to the following list of currently available leasing and licensing opportunities, these guidelines are intended to address and include future ground floor retail and community serving spaces that may be developed in the downtown district in the future, but are as yet not conceived, proposed, or built.

City-owned structures and public right-of-ways in the downtown district that are and will become available for lease or license, and associated Preferred Uses, are as follows:

A. Center Court

There are three (3) Center Courts, one court located mid-block on each block of

3 the Third Street Promenade, totaling 1,875 sq. ft. (625 sq. ft. each).

Current Use: Programmed special event space (e.g., holiday decorations), a concierge cart, or other services/facilities for visitors. Street performers are allowed in the Center Court of the 1300 Block only.

Preferred Use: Programmed special event space (e.g., holiday decorations), a concierge cart or other services/facilities for visitors, visitor amenities including security stations, and street performers (in the Center court of the 1300 Block only). Ancillary outdoor dining with table service, if feasible, for existing Promenade restaurants, is encouraged, subject to regulations set forth in the Santa Monica Municipal Code.

B. Pavilions

There are two (2) Pavilions located in the center median of the Third Street Promenade, totaling 1,512.5 square feet. The North Pavilion contains 762.5 leasable sq. ft., and the South Pavilion contains 750 leasable sq. ft.

Current Use: Visitor-serving commercial/retail and food service uses.

South Pavilion 1400-A Third Street Promenade, 250 sq. ft. 1400-B Third Street Promenade, 500 sq. ft.

North Pavilion 1257 Third Street Promenade, 212.5 sq. ft. 1260 Third Street Promenade, 550 sq. ft.

Preferred Use: Restaurant/cafe use with outdoor dining, with or without alcohol service, to appeal to and serve both the residential community and area visitors and cumulatively provide for diverse food and beverage offerings, price points, hours of operation, aesthetic ambiance and any other factor deemed to enhance the character and pedestrian orientation of the Promenade and the downtown district. Informal seating is encouraged in any common area described as part of the leasehold, provided the seating area is not required to be enclosed by a barrier in accordance with the City's Municipal Code or the Alcohol and Beverage Commission. Alternately, retail lease space for specialty items may be considered when vacancies occur and as market demand warrants.

C. Parking Structure Leased Premises

Current Use: Neighborhood and community- oriented commercial, educational, and recreational services.

Parking Structure No. 5 1440 – 1454 Fourth Street, 500 sq. ft.

Parking Structure No. 6 1431 Second Street, 7,000 sq. ft.

Preferred Use: Neighborhood and community oriented commercial, visitor- serving, educational, transit and parking services center with ancillary public restrooms and commercial uses, operated in a manner that activates the pedestrian experience and serves the neighborhood, community, businesses and visitors in the downtown.

Parking Structure No. 5 Parking Structure No. 5 contains a total of approximately 5,282 square feet of retail space, approximately 500 sq. ft. will remain for commercial serving purposes, with the balance of the space repurposed to serve as a Transit and Parking Services center.

Parking Structure No. 6 Parking Structure No. 6 contains a combination of commercial and bicycle parking spaces.

Commercial space is approximately 7,000 square feet divided into three tenant spaces:

1431 Second Street, Suite A, 3,481 sq. ft. 1431 Second Street, Suite B, 1,133 sq. ft. 1431 Second Street, Suite C, 2,253 sq. ft.

Bicycle parking space is approximately 890 square feet improved with bicycle racks and conduits to accommodate a bike operator and bike parking services.

D. Vending Cart License

Operation of a retail and food vending cart program from designated public right- of-way locations on the Third Street Promenade.

Current Use: Master Cart Licensee Program, which provides a minimum of 22 and a maximum of 32 individual carts to operators, subject to sublicense agreements. Vending carts operate solely along Third Street Promenade, and are predominately general merchandise carts. In addition, Master Cart Operator offers three carts for artists and one concierge cart for DTSM.

Preferred Use: Expansion of Vending Cart Program by individual vendors to include designated Transit Mall locations, where feasible, and other locations allowed by the Santa Monica Municipal Code. Vending cart operators are encouraged to offer products and services that enhance the special qualities of

5 the Promenade and/or Santa Monica, and create an experience that is uniquely "Santa Monica."

E. Temporary Licenses/Other

From time to time, temporary licenses or other agreements may be granted for use of the Third Street Promenade or other downtown district locations that are consistent with the Guideline Objectives.

II. PREFERENCE FOR LOCAL, INDEPENDENT, AND NON-FORMULA BUSINESSES

The leasing and licensing of all City-owned properties and rights-of-way within the downtown district will be subject to a preference for local, independent, non-formula businesses and community services that are financially and operationally capable of providing the Preferred Uses. Such preference will be reflected in bonus ratings for responses received from independent businesses as part of a public Tenant Recruitment process. A formula business is defined as a business having three or more sites outside the City of Santa Monica that requires, by contractual or other arrangement, the maintenance of standardized service, decor, uniforms, facility design and format substantially identical to another operation.

Ill. LEASE TERMS, OPTIONS AND RENEWALS

As vacancies arise, either by lease expiration or earlier termination, available space will be offered for Preferred Uses for non-renewable lease terms up to five years if substantial new capital investment in structures, structural improvements or equipment is not warranted. If a tenant is required to make substantial new capital investment in structures, structural improvements or equipment to implement the Preferred Use consistent with intended purposes of the premises, one to three five-year lease options may be offered varying with amortization and financial requirements of the new capital investment.

Lease renewals or options to extend the terms of occupancy will not be automatically offered to existing tenants upon expiration of agreements. As vacancies arise, either by natural expiration or earlier termination, recruitment for each opportunity site will be conducted in accordance with these Leasing Guidelines. It is recognized, that reliability and continuity of quality commercial services are valuable assets to the public experience of the Promenade and the downtown district. In order to support and encourage businesses in the downtown district to operate and maintain their premises in an exemplary manner such businesses will be subject to a renewal preference reflected in bonus ratings for responses received as part of a public Tenant Recruitment process. The term "exemplary manner" refers to those tenants who meet all of the following criteria: (i) consistently provide a high quality product within the business category, with excellent customer service; (ii) maintain their premises in a first class and attractive manner; and (iii) comply with all lease or 6 license provisions, as well as all applicable local, state and federal laws and regulations, and as further described in Section XII.

Consideration of minor physical expansion of existing leasehold occupancies may be approved for tenants who seek to enhance, improve or modify their business operations consistent with the Preferred Uses through the investment of additional capital in structures, structural improvements or equipment in a manner that does not limit or diminish tenant diversity in the downtown district. Such expansion must advance the Preferred Uses for the benefit of the public, the downtown district, and the City. In order to provide access to diverse tenants capable of providing Preferred Use on City- owned properties, the physical expansion of existing and new leasehold occupancies, other than for restaurants, will be considered on a case-by-case basis, subject to existing Zoning and usage guidelines.

IV. DIVERSITY OF TENANCIES

In order to promote operator diversity in the development and use of leasehold opportunity sites, the prospective grant of multiple leasehold areas to an individual tenant, operator, or business entity will be considered on a case-by-case basis.

V. LABOR PEACE

Because the City has a financial or proprietary interest in the businesses operating from its leaseholds, some of which are in industries that have a history of labor/management conflict, the risk of interruption of rental revenue received by the City would be minimized if such businesses were assured of labor peace. An appropriate labor peace provision for businesses engaged in visitor-serving commercial activities minimizes the City's exposure to revenue interruption and disruption of public enjoyment of the Promenade and Downtown District. New or substantially amended agreements for leasehold operation shall provide that the tenant will not engage in practices that impede employees' ability to organize and contract with a labor organization for the purpose of collective bargaining. Such prohibited practices include harassment, intimidation, "captive audience" anti-union meetings or illegal terminations of workers in retaliation for organizing. A substantial amendment is defined as a change of use of the property, an increase in seating or square footage of more than 25%, or an extension of lease duration. Tenant engagement in prohibited practices shall constitute an event of default under the terms of lease. Affected leases are those businesses having five or more full or part-time employees and engaged in restaurant or visitor-serving activities.

VI. SUSTAINABLE BUSINESS PRACTICES

These Guidelines encourage lessees and licensees to adhere to sustainable business practices in all aspects of their operation, in accordance with City, State and Federal regulations and consistent with best practices that seek to "reduce, reuse and recycle” non-renewable resources.

7 VII. PERIODIC REVIEW OF RENTAL RATES

Lease rental rates will be established at independently appraised fair market rates or in accordance with responses received to a public Request for Proposal process. Responses received for lease and license opportunities are encouraged to exceed the minimum and percentage rents set forth in the Requests. The City reserves the right to negotiate lease rates that further the establishment or retention of a Preferred Use, consistent with these guidelines. Annual CPI adjustments based on the Consumer Price Index for Los Angeles – Anaheim – Riverside – Orange County, published by the Bureau of Labor Statistics of the United States Department of Labor, will be made for the term of any new property lease or license.

VIII. FACILITY CONDITION

All City-owned structures are leased “as-is” and each tenant will be required to bring the space to a decent, safe and sanitary condition appropriate for the Preferred Use. If tenants must make improvements to the structure to implement the Preferred Uses as a mutually agreed condition of a lease, the City will first review and approve the proposed scope of work and design of the tenant improvements. All necessary building permits must be obtained at tenant or licensee cost, and the work inspected for compliance with applicable codes. Appropriate rental credits for the approved work performed may be negotiated as part of the lease or license agreement. Tenant improvement credits will not be offered for outdoor dining areas.

In the event a tenant is required to invest its own funds to bring a City owned property in a cold shell condition up to code standards and required to construct substantial base improvements such as leveling floors, restrooms, demising walls, ceilings, fire protection system (sprinklers), HVAC units, electrical subpanel, wiring, install floor drains and connections to sewer line, x-ray, coring, meters and other necessary utilities, and other code related improvements or fees necessary to obtain building permits for the base improvements, the City may provide the tenant with a negotiated rent credit against rents due when the rent commencement phase is initiated. In no event shall rent credits exceed the tenant’s costs to construct and complete the base improvements.

IX. TENANCY RELATIONSHIPS

All City-owned property within the downtown district appropriate and suitable for leasing or licensing by the City to individual occupants for the Preferred Uses will be in accordance with agreements prepared by the City. Each tenant or licensee is responsible at its expense for interior maintenance and repair and utility consumption, and the City retains responsibility for maintenance and repair of roofs and building exteriors. Subletting of space is explicitly prohibited, with the exception of vending cart agreements, to individual cart operators issued by the licensee.

All City-owned property within DTSM that is appropriate and suitable for leasing or

8 licensing will be subject to a public marketing and solicitation process. This process will identify prospective tenants and licensees with financial and experience qualifications for the Preferred Use of the available space. Vacancies will be the subject of public Requests for Qualifications and/or Requests for Proposals publicized utilizing:

Media advertising, including general circulation newspapers or local/limited circulation publications;

Direct mail to a waiting list and/or other targeted individuals having expressed previous interest in leasehold occupancy or license operation for the available Preferred Use;

Posting notices on DTSM’s, and the City's web sites. As appropriate, vacancies may also be publicized utilizing: 1. Direct contact or outreach to prospective tenants; 2. Dissemination by fax, e-mail or telephone to local commercial real estate brokers; 3. Press releases and other direct marketing performed by Downtown Santa Monica, Inc. 4. E-blasts, text-blasts, or other electronic or social media, as deemed appropriate by the City.

The Downtown Santa Monica, Inc. Board of Directors will review and approve Requests for Proposals prior to public dissemination by the City. The Request for Qualifications and/or Request for Proposals will set forth the Preferred Uses of the available space, proposed terms and conditions for the leasehold or license opportunity, and criteria for reviewing and rating responses. All respondents and prospective tenants will file a Lease or License Application. Information contained in the Lease Application will be utilized for evaluation and confirmation that the proposed tenancy is a Preferred Use for the available space, and verification of experience, references and financial capability to perform leasehold obligations. Responses will also state preliminary terms and conditions for the proposed lease or license.

Responses to Request for Qualifications and/or Request for Proposals will be analyzed and rated by a Review Team comprised of City staff and the CEO of DTSM, Inc. or his/her designee. The Review Team will provide its analysis and recommended preferred respondent, inclusive of appropriate bonus ratings for independent, non- formula business respondents and complying tenant renewal proposals to the DTSM District Issues Committee, who will make a recommendation to the DTSM Board of Directors. The recommendation of the District Issues Committee to the DTSM Board of Directors may be to reject all responses, solicit additional information from one or more respondents, or for the City to enter exclusive lease or license negotiations with a preferred respondent. As part of its deliberations prior to making a recommendation, the District Issues Committee and DTSM Board of Directors may request specific information to supplement the Review Team's oral or written presentation, including copies of all proposals received.

In addition, the City may retain a qualified commercial real estate firm or listing agent to market property, negotiate lease or license terms, provide consultation, and coordinate 9 with prospective tenants and other realtors. The City does not currently pay nor receive commissions for leasing of City-owned property, but will consider utilizing such services on a case-by-case basis. Staff will continue to cooperate with commercial real estate brokers who are authorized to negotiate leases and licenses on behalf of prospective tenants.

X. EVALUATION CRITERIA

The Review Team will rank the candidates and make its recommendation based on the strength of the prospective lessee or licensee. Criteria, as defined by the City and/or DTSM. Selection criteria may include any of the following: (i) character, integrity, reputation, judgment, training, and experience of the prospective tenant or licensee; (ii) ability, capacity, and skill of the prospective tenant or licensee; (iii) capacity to perform; (iv) quality of the services or goods to be provided; (v) price of the goods or services; and (vi) financial resources. The selection process shall grant additional points to those existing downtown district tenants and licensees that are deemed to have operated in an Exemplary Manner. The term “Exemplary Manner” shall mean and refer to those tenants or licensees who meet all of the following criteria: (i) provide on a consistent basis a high quality product with excellent customer service; (ii) maintains their premises or cart in a first class and attractive manner; and (iii) complies with all lease or license provisions, as well as all applicable local, state and federal laws and regulations.

All respondents and prospective tenants will file a Lease or License Application. Information contained in the Lease or License Application will be utilized for confirmation that the proposed tenancy is a Preferred Use for the available space, and for verification of experience, references and financial capability to perform leasehold obligations. Responses will also state preliminary terms and conditions for the proposed lease or license.

XI. DELEGATION OF AUTHORITY

The Review Team will provide an oral or written report of its deliberations to the DTSM District Issues Committee. The District Issues Committee will present its recommendation to the DTSM Board of Directors. The Board of Directors may accept the District Issues Committee's recommendation, request additional information, or reject all proposals and request modifications to the RFP and direct that the City conduct another public solicitation process.

Upon recommendation of the DTSM Board of Directors, City staff will negotiate a Lease or License and report to the Board the terms contained in the Lease or License prior to its submittal to the City Manager for execution. The City Manager will execute leases and licenses of City-owned property recommended by the Board of Directors, that are prepared in accordance with these Leasing Guidelines, the objectives set forth in the Request for Proposal, terms and conditions negotiated by the City, and on the basis of written agreements prepared and approved as to form by the City Attorney. Staff will consider the suggestions and/or recommendations of the Board in its negotiations and preparation of documents.

APPENDIX A: LEASEES AND LICENSEES AS OF February 28, 2015

South Pavilion

1400-A Third Street Promenade, 250 sq. ft., occupied by Mudra, Inc. a women's apparel store, whose license expired on August 31, 2014. Currently, this business is on a month-to-month holdover until a Request for Proposals is issued and tenant selection is completed in the third quarter of 2015 for this license opportunity. 1400-B Third Street Promenade, 500 sq. ft., occupied by Bussola, Inc., ·dba Locanda del Lago, a restaurant, whose license expires April 1, 2016.

North Pavilion

1257 Third Street Promenade, 212.5 sq. ft., occupied by Above the Fold, a newsstand, which has exercised its first and second option that extends until July 31, 2010, and that has one additional option that extends it through July 31, 2015. A Request for Proposal will be issued in the third quarter of 2015 to include the opportunity to license this space as the license with the existing business is set to expire on August 1, 2015.

1260 Third Street Promenade, 550 sq. ft., occupied by Strouk Group, doing business as Messr. Marcel Pain, Vin et Fromage, a restaurant with outdoor dining surrounded by railing, whose lease expires July 31, 2017.

Public Rights-of-Way

Provenzano Resources Inc., operator of the Master Cart Licensee Program, provides a minimum of 22 and a maximum of 32 individual carts to operators, subject to sublicense agreements. Vending carts operate solely along Third Street Promenade, and are predominately general merchandise carts. In addition, Master Cart Operator offers three carts for artists and one concierge cart for Downtown Santa Monica, Inc. The original ten-year license agreement expires June 30, 2015, with one five-year option.

Parking Structure No. 5

Currently, the commercial spaces at 1440 and 1454 Fourth

11 Street, occupied by the Dance Doctor and Western Union, respectively, are on a month-to-month holdover until a Request for Proposals (RFP) for the anticipated 500 sq. ft. of commercial space proposed for the TAPS Center is issued and tenant selection is completed in the third quarter of 2015 for lease opportunity.

1444 Fourth Street, 412 sq. ft., occupied by Central Parking, the City's parking operator, is not subject to the Guidelines as this office space is required by contract and the parking operator is not obliged to pay rent to the City.

Parking Structure No. 6

The reconstruction of Parking Structure No. 6 was completed in December 2013. The new facility features approximately 7,000 sq. ft. of leasable ground floor commercial space currently leased by the following tenants:

1431 Second Street, Suite A, 3,481 sq. ft., is occupied by Orangetheory Fitness, whose lease expires on July 18, 2019, with three (3) options of up to five-years each.

1431 Second Street, Suite B, 1,133 sq. ft., is occupied KC Chocolatier, whose lease expires on October 28, 2019, with two (2) options of up to five-years each.

1431 Second Street, Suite C, 2,253 sq. ft., occupied by Espresso Cielo, whose lease expires on October 29, 2019, with two (2) options of up to five-years each.

In addition, Parking Structure 6 contains approximately 887 sq. ft. of bicycle parking complete with bicycle racks and electrical infrastructure to support a bicycle parking and services program. A Request for Proposal will be issued with tenant selection to operate this space to be completed in the third quarter of 2015.

12 Attachment AB

DOWNTOWN SANTA MONICA LEASING AND LICENSING GUIDELINES

Adopted July 8, 2003 Amended April10, 2007 Amended June 24, 2008 Amended March 19, 2013 Proposed Revisions/Comments 2.19.13Amendments March 24, 2015

TABLE OF CONTENTS

GUIDELINE OBJECTIVES ...... 3 I. PREFERRED USES ...... 3 A. Center Court...... 3 B. Pavilions ...... 4 C. Parking Structure Leased Premises ...... 4 D. Vending Cart License ...... 5 E. Temporary Licenses/Other ...... 6 II. PREFERENCE FOR LOCAL, INDEPENDENT, AND NON-FORMULA BUSINESSES ...... 6 Ill. LEASE TERMS, OPTIONS AND RENEWALS ...... 6 IV. DIVERSITY OF TENANCIES ...... 7 V. LABOR PEACE ...... 7 VI. SUSTAINABLE BUSINESS PRACTICES ...... 7 VII. PERIODIC REVIEW OF RENTAL RATES ...... 7 VIII. FACILITY CONDITION ...... 8 IX. TENANCY RELATIONSHIPS ...... 8 X. EVALUATION CRITERIA ...... 9 XI. DELEGATION OF AUTHORITY ...... 10 LICENSEES AS OF DECEMBER 4, 2012 ...... 11

GUIDELINE OBJECTIVES ...... 4 I. PREFERRED USES ...... 4 A. Center Court...... 445 B. Pavilions ...... 5 C. Parking Structure Leased Premises ...... 556 D. Vending Cart License ...... 7 E. Temporary Licenses/Other ...... 7 II. PREFERENCE FOR LOCAL, INDEPENDENT, AND NON-FORMULA BUSINESSES ...... 778 Ill. LEASE TERMS, OPTIONS AND RENEWALS ...... 778 IV. DIVERSITY OF TENANCIES ...... 889 V. LABOR PEACE ...... 889 VI. SUSTAINABLE BUSINESS PRACTICES ...... 9 VII. PERIODIC REVIEW OF RENTAL RATES ...... 9 2

VIII. FACILITY CONDITION ...... 9910 IX. TENANCY RELATIONSHIPS ...... 10 X. EVALUATION CRITERIA ...... 111112 XI. DELEGATION OF AUTHORITY ...... 12 APPENDIX A: LICENSEES AS OF FEBRUARY 28, 2015 ...... 13

GUIDELINE OBJECTIVES

I. PREFERRED USES

City-owned structures and public right-of-ways in the downtown district that are and will become available for lease or license, and associated Preferred Uses, are as follows:

A. Center Court A. There are three (3) Center Courts, one court located mid-block on each block of

the Third Street Promenade, totaling 1,875 st. ft. (625 sq. ft. each).

A.B. Pavilions

Current Use: Visitor-serving commercial/retail and food service uses.

South Pavilion 1400-A Third Street Promenade, 250 sq. ft. 1400-B Third Street Promenade, 500 sq. ft.

North Pavilion 1257 Third Street Promenade, 212.5 sq. ft. 1260 Third Street Promenade, 550 sq. ft.

B.C. Parking Structure Leased Premises

Current Use: Neighborhood and community- oriented commercial, educational, and recreational services.

Parking Structure No. 5 1454 Fourth Street, 841 sq. ft. 5

1450 Fourth Street, 675 sq. ft. 1448 Fourth Street, 276 sq. ft. 1444 Fourth Street, 412 sq. ft. 1440 Fourth Street, 3,078 sq. ft. 1440 – 1454 Fourth Street, 500 sq. ft.

Parking Structure No. 6 1431 Second Street, 7,000 sq. ft.

Preferred Use: Neighborhood and community oriented commercial, visitor- serving, educational, and recreational transit and parking services; retail or restaurant uses center with outdoor dining that operateancillary public restrooms and commercial uses, operated in a manner that animatesactivates the pedestrian experience. and serves the neighborhood, community, businesses and visitors in the downtown.

Parking Structure No. 5 Parking Structure No. 5 contains a total of approximately 5,282 square feet of retail space, currently divided into five leaseholds, all of which are either on month-to-month holdover status, or have leases that expire within the next five years. A master tenancy option will be considered for a master tenant desiring to make a substantial investment in property improvements.approximately 500 sq. ft. will remain for commercial serving purposes, with the balance of the space repurposed to serve as a Transit and Parking Services center.

Parking Structure No. 6 Parking Structure No. 6 has been demolished contains a combination of commercial and bicycle parking spaces.

Commercial space is being rebuilt. It will contain approximately 7,000 square feet of retail and storage space. divided into three tenant spaces:

1431 Second Street, Suite A portion of the storage, 3,481 sq. ft. 1431 Second Street, Suite B, 1,133 sq. ft. 1431 Second Street, Suite C, 2,253 sq. ft.

space will be occupied by DTSM and the City’s Farmers’ Market program. The remaining square footage is divisible, and will be minimally built out, including utility stub-ins. It will be the responsibility of the tenant to build-out the Bicycle parking space. A master tenancy option will be considered for a master tenant desiring is approximately 890 square feet improved with bicycle racks and conduits to makeaccommodate a substantial investment in property improvements.bike operator and bike parking services.

C.D. Vending Cart License

Operation of a retail and food vending cart program from designated public right--of-way locations on the Third Street Promenade.

Current OperationUse: Master Cart Licensee Program, which provides a minimum of 22 and a maximum of 32 individual carts to operators, subject to sublicense agreements. Vending carts operate solely along Third Street Promenade, and are predominately general merchandise carts. In addition, Master Cart Operator offers three carts for artists and one concierge cart for DTSM.

D.E. Temporary Licenses/Other

From time to time, temporary licenses or other agreements may be granted for use of the Third Street Promenade or other downtown district locations that are consistent with the Guideline Objectives.

II. PREFERENCE FOR LOCAL, INDEPENDENT, AND NON-FORMULA BUSINESSES

Ill. LEASE TERMS, OPTIONS AND RENEWALS

consistent with intended purposes of the premises, one to three five-year lease options may be offered varying with amortization and financial requirements of the new capital investment.

Lease renewals or options to extend the terms of occupancy will not be automatically offered to existing tenants upon expiration of agreements. As vacancies arise, either by natural expiration or earlier termination, recruitment for each opportunity site will be conducted in accordance with these Leasing Guidelines. It is recognized, that reliability and continuity of quality commercial services are valuable assets to the public experience of the Promenade and the downtown district. In order to support and encourage businesses i n t h e do w n t o w n d is t r i c t to operate and maintain their premises in an exemplary manner, such businesses will be subject to a renewal preference reflected in bonus ratings for responses received as part of a public Tenant Recruitment process. The term "exemplary manner" refers to those tenants who meet all of the following criteria: (i) consistently provide a high quality product within the business category, with excellent customer service; (ii) maintain their premises in a first class and attractive manner; and (iii) comply with all lease or license provisions, as well as all applicable local, state and federal laws and regulations, and as further described in Section XII.

IV. DIVERSITY OF TENANCIES

V. LABOR PEACE

leasehold operation shall provide that the tenant will not engage in practices that impede employees' ability to organize and contract with a labor organization for the purpose of collective bargaining. Such prohibited practices include harassment, intimidation, "captive audience" anti-union meetings or illegal terminations of workers in retaliation for organizing. A substantial amendment is defined as a change of use of the property, an increase in seating or square footage of more than 25%, or an extension of lease duration. Tenant engagement in prohibited practices shall constitute an event of default under the terms of lease. Affected leases are those businesses having five or more full or part-time employees and engaged in restaurant or visitor-serving activities.

VI. SUSTAINABLE BUSINESS PRACTICES

VII. PERIODIC REVIEW OF RENTAL RATES

VIII. FACILITY CONDITION

rents due when the rent commencement phase is initiated. In no event shall rent credits exceed the tenant’s costs to construct and complete the base improvements.

IX. TENANCY RELATIONSHIPS

All City-owned property within DTSM that is appropriate and suitable for leasing or licensing will be subject to a public marketing and solicitation process. This process will identify prospective tenants and licensees with financial and experience qualifications for the Preferred Use of the available space. Vacancies will be the subject of public Requests for Qualifications and/or Requests for Proposals publicized utilizing:

 Media advertising, including general circulation newspapers or local/limited circulation publications;

 Direct mail to a waiting list and/or other targeted individuals having expressed previous interest in leasehold occupancy or license operation for the available Preferred Use;

 Posting notices on DTSM’s, and the City's web sites. As appropriate, vacancies may also be publicized utilizing:

1. Direct contact or outreach to prospective tenants; 2. Dissemination by fax, e-mail or telephone to local commercial real estate brokers; 3. Press releases and other direct marketing performed by Downtown Santa Monica, Inc. 4. E-blasts, text-blasts, or other electronic or social media, as deemed appropriate by the City. 4. The Downtown Santa Monica, Inc. Board of Directors will review and approve Requests for Proposals prior to public dissemination by the City. The Request for Qualifications and/or Request for Proposals will set forth the Preferred Uses of the available space, proposed terms and conditions for the leasehold or license opportunity, and criteria for reviewing and rating responses. All respondents and prospective tenants will file a Lease or License Application. Information contained in the Lease Application will be utilized for evaluation and confirmation that the proposed tenancy is a Preferred Use for the available space, and verification of experience, references and financial

capability to perform leasehold obligations. Responses will also state preliminary terms and conditions for the proposed lease or license.

Responses to Request for Qualifications and/or Request for Proposals will be analyzed and rated by a Review Team comprised of City staff and the CEO of DTSM, Inc. or his/her designee. The Review Team will provide its analysis and recommended preferred respondent, inclusive of appropriate bonus ratings for independent, non-- formula business respondents and complying tenant renewal proposals to the DTSM District Issues Committee, who will make a recommendation to the DTSM Board of Directors. The recommendation of the District Issues Committee to the DTSM Board of Directors may be to reject all responses, solicit additional information from one or more respondents, or for the City to enter exclusive lease or license negotiations with a preferred respondent. As part of its deliberations prior to making a recommendation, the District Issues Committee and DTSM Board of Directors may request specific information to supplement the Review Team's oral or written presentation, including copies of all proposals received.

In addition, the City may retain a qualified commercial real estate firm or listing agent to market property, negotiate lease or license terms, provide consultation, and coordinate with prospective tenants and other realtors. The City does not currently pay nor receive commissions for leasing of City-owned property, but will consider utilizing such services on a case-by-case basis. Staff will continue to cooperate with commercial real estate brokers who are authorized to negotiate leases and licenses on behalf of prospective tenants.

X. EVALUATION CRITERIA

XI. DELEGATION OF AUTHORITY

Upon recommendation of the DTSM Board of Directors and approval by City Council, City staff will negotiate a Lease or License and report to the Board the terms contained in the Lease or License prior to its submittal to the City Manager for execution. The City Manager will execute leases and licenses of City-owned property recommended by the Board of Directors, t h a t a r e prepared in accordance with these Leasing Guidelines, the objectives set forth in the Request for Proposal, terms and conditions negotiated by the City, and on the basis of written agreements prepared and approved as to form by the City Attorney. Staff will consider the suggestions and/or recommendations of the Board in its negotiations and preparation of documents.

APPENDIX A: LEASEES AND LICENSEES AS OF DECEMBER 4, 2012February 28, 2015

South Pavilion

1400-A Third Street Promenade, 250 sq. ft., occupied by Mudra, Inc. a women's apparel store, whose license expires August 31, 2014.

expired on August 31, 2014. Currently, this business is on a month-to-month holdover until a Request for Proposals is issued and tenant selection is completed in the third quarter of 2015 for this license opportunity. 1400-B Third Street Promenade, 500 sq. ft., occupied by Bussola, Inc., ·dba Locanda del Lago, a restaurant, whose license expires April 1, 2016.

North Pavilion

Public Rights-of-Way

Parking Structure No. 5

1454 Fourth Street, 841 sq. ft. occupied by Western Union, whose lease expires June 30, 2014.

1450 Fourth Street, 675 sq. ft., occupied by Garbo Shoe Repair, whose lease expires June 30, 2014.

1448 Fourth Street, 276 sq. ft., occupied by Peter's Barber Shop, whose lease expired May 1999, and who is on a month-to- month holdover.

1444 Fourth Street, 412 sq. ft., occupied by Central Parking, which is the City's parking operator. By contract, the parking

operator is not obliged to pay rent to the City for this office.

1440 Fourth Street, 3,078 sq. ft., occupied by The Dance Doctor, whose lease expired September 30, 2012, without tenant having exercised the remaining five-year option. Tenant is on a month-to-month holdover.

Parking Structure No. 6

Parking Structure No. 6 has been demolished and is being rebuilt. The new structure will include space for DTSM storage, Farmers’ Market storage, and approximately 7,000 of retail space for lease, which is divisible, and will be built out only minimally, including utility stub-ins.

Other

Current Use: Provenzano Resources Inc., operator of the Master Cart Licensee Program, provides a minimum of 22 and a maximum of 32 individual carts to operators, subject to sublicense agreements. Vending carts operate solely along Third Street Promenade, and are predominately general merchandise carts. In addition, Master Cart Operator offers three carts for artists and one concierge cart for Downtown Santa Monica, Inc. The original ten-year license agreement expires June 30, 2015, with one five-year option.

Parking Structure No. 5

Currently, the commercial spaces at 1440 and 1454 Fourth Street, occupied by the Dance Doctor and Western Union, respectively, are on a month-to-month holdover until a Request for Proposals (RFP) for the anticipated 500 sq. ft. of commercial space proposed for the TAPS Center is issued and tenant selection is completed in the third quarter of 2015 for lease opportunity.

1444 Fourth Street, 412 sq. ft., occupied by Central Parking, which is the City's parking operator, is not subject to the Guidelines as this office space is required by . By contract, and the parking operator is not obliged to pay rent to the City. for this office.

Parking Structure No. 6

1431 Second Street, Suite A, 3,481 sq. ft., is occupied by Orangetheory Fitness, whose lease expires on July 18, 2019, with three (3) options of up to five-years each.

1431 Second Street, Suite B, 1,133 sq. ft., is occupied KC Chocolatier, whose lease expires on October 28, 2019, with two (2) options of up to five-years each.

1431 Second Street, Suite C, 2,253 sq. ft., occupied by Espresso Cielo, whose lease expires on October 29, 2019, with two (2) options of up to five-years each.

16 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 3-C To: Mayor and City Council From: Karen Ginsberg, Community and Cultural Services Director Susan Cline, Interim Director of Public Works

Subject: Beach Bike Trail Sweeping

Recommended Action

Staff recommends that the City Council: 1) Authorize the City Manager to negotiate and execute a cooperation agreement with Los Angeles County for the City to sweep the Beach Bike Trail within Santa Monica, whereby the County would reimburse the City $30,000 annually, adjusted by the Consumer Price Index (CPI). 2) Authorize the Purchasing Services Manager to issue a purchase order with Tennant Company, a Minnesota-based company, for one heavy-duty outdoor sweeper. This is a sole source purchase in an amount not to exceed $199,540. 3) Authorize the budget changes outlined in the Financial Impacts and Budget Actions section of this report.

Executive Summary The City has proposed taking over the sweeping of the Beach Bike Trail from Los Angeles (LA) County to increase frequency from two or three days to five days per week to improve public safety and accessibility. The annual ongoing cost to the Beach Fund is $88,723 for additional staff, which will be offset by an annual $30,000 reimbursement from LA County. The annual ongoing costs and revenues would be included in the FY 2015-17 biennial budget. A one-time appropriation from the Beach Fund to the Vehicle Management Fund in the amount of $226,436 for the purchase of a sweeper and first year of depreciation is recommended now to enable the program to begin on July 1, 2015.

Background

Los Angeles County built the 19 mile continuous bicycle trail, currently known as the Marvin Braude Bike Trail (Bike Trail) in 1972, beginning at California Avenue in Santa Monica and extending southward to Via Rivera in Torrance. The City of Santa Monica 1 extended the bike trail to the northern City limits in 1989. The County has had responsibility for maintaining and repairing the bike trail since it was built.

The County’s schedule for sweeping the bike trail is twice a week during the winter months and three times a week during the summer. Since the County is responsible for sweeping the entire bike trail, and may run into delays along its length due to starting in areas south of Santa Monica, the schedule is not always met, causing sand to build up on the trail. While Beach Maintenance staff does not have the heavy equipment to clear the bike trail, staff use push brooms to remove sand when the County misses a day, or when sand covers the trail between the scheduled days. In addition, the equipment used by the County to clear the trail scrapes the pavement and has damaged the recently installed trail guidance markings. In response to these issues, staff initiated discussions with LA County Department of Public Works to transfer responsibility for sweeping the 2.9 mile portion of the bike trail in Santa Monica to the City.

Discussion

The proposed Cooperation Agreement would enable the City to assume responsibility for sweeping the 2.9 mile portion for a period of ten years, with the option to extend the agreement. The County would reimburse the City $30,000 annually, adjusted by the Consumer Price Index (CPI). The reimbursement amount is based on the amount of Transportation Development Act (TDA) funds from the State that are provided to the County for sweeping the Santa Monica portion of the bike trail.

The Santa Monica section is one of the most heavily traveled parts of the bike trail. Staff has analyzed the County’s sweeping schedule and is recommending a more frequent sweeping program due to the high usage of the bike trail and the large amount of sand that is blown or tracked onto the trail. The proposed schedule is as follows: • Entire Bike Trail: Five times a week (Monday to Friday) • Hot Spots along Bike Trail/Ocean Front Walk: Three times a week (Monday, Wednesday and Thursday) – as needed 2 The hot spots include sections of the bike trail that are most heavily used and often covered in sand, such as the area around the 1550 lot, as well as the pedestrian path north and south of the Pier, and Ocean Front Walk, which are not currently swept by the County.

The City’s takeover of the sweeping function would require additional staff and equipment. Staff proposes to add one small, heavy-duty sweeper to the City’s fleet through the Vehicle Management Fund and to hire an Equipment Operator II for the Beach Maintenance Section to operate the sweeper. There is currently no available staff within the Section to fulfill this function. The shift to a five-day a week schedule with dedicated personnel would provide additional opportunities for improved sweeping of Ocean Front Walk and hard to reach areas of the beach parking lots. Ocean Front Walk is not currently swept by the County. These areas are swept by City staff with push brooms, as time permits.

The additional expense for staff and equipment to increase the sweeping frequency is recommended to improve safety and access. Sand build up reduces lane capacity and may create a slippery surface. Use of the bike trail has grown steadily as a year-round recreation activity and transportation mode. The expansion of year-round activity at Santa Monica State Beach has also increased parking and concession revenues in the Beach Fund, making additional financial resources available to preserve and promote access to the beach including investing in the sweeping of the bike trail as proposed.

The total annual ongoing cost for an Equipment Operator II is $88,723. This would be partially offset each year by the $30,000 reimbursement from the County. The expenditures and revenues for the sweeping would come from and to the Beach Fund. The one-time cost of the sweeper along with the first year of depreciation is $226,436. The funds for the Equipment Operator II and the revenues from the County reimbursement would be included in the proposed FY 2015-17 budget.

Vendor Selection Staff recommends Tennant Company to furnish and deliver one Sentinal heavy-duty sweeper on a sole source basis. The purchase is economically available from a single source because the compatibility of the sweeper is of paramount consideration to this application. The recommended sweeper is a small, heavy-duty, outdoor, dust-free sweeper that is the width of one lane of the bike trail. The full length glass doors and windshield glass provide the operator a clear view to maximize safety. Although there are other types of sweepers available, Beach Maintenance staff has tested the unit for functionality against two other sweeper units and says it is uniquely fitted for this application due to the reasons noted above, which increase safety along the busy bike trail. The other types of sweepers are too large for the application and would cost several thousand dollars more to purchase. There are no other comparable units on the market that match this unit.

Alternatives

The Council could forego authorizing the City Manager to enter into a cooperation agreement with the County and continue to have the County sweep the bike trail on the current limited schedule. The Council could also deny the appropriation of funds for the sweeper, which would prevent the City from taking over the sweeping of the path. Both of these alternatives would maintain the current level of service for sweeping the bike trail.

4 Financial Impacts & Budget Actions

The cooperation agreement will cost $88,723 annually and will generate revenues of $30,000, for a net impact of $58,723 to the Beach Fund. Funding for these ongoing costs will be requested during the FY 2015-17 biennial budget process. Implementation of the program requires the following FY2014-15 budget actions to allow the Beach Fund to purchase the sweeper: 1) Increase the revenue budget in account 54459.405760 (Vehicle Enhancement Purchases) by $199,540; 2) Appropriate $199,540 for the purchase of one sweeper to account C540167.589100, Vehicle Enhancement Purchases; 3) Increase the revenue budget at account 54459.402660 (Future Vehicle Replacement) by $26,896; 4) Appropriate $26,896 to account IS110167.589000. The purchase order for the sweeper will be charged to C540167.589100.

Prepared by: Judith Meister, Beach Administrator

Approved: Forwarded to Council:

Karen Ginsberg Elaine M. Polachek Director, Community and Cultural Interim City Manager Services Department

______Susan Cline Interim Director, Public Works Department

5 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 3-D To: Mayor and City Council From: Jacqueline A. Seabrooks, Chief of Police Subject: Amendment to the Strategic Prevention Framework – State Incentive Grant

Recommended Action Staff recommends that the City Council: 1. Authorize the City Manager to negotiate and execute an amendment to the Strategic Prevention Framework – State Incentive Grant in the amount of $9,600 for a total amount of $57,600; 2. Authorize the budget changes as outlined in the Financial Impacts and Budget Actions section of this report.

Executive Summary On August 12, 2014, Council accepted a grant award in the amount of $48,000 from the Strategic Prevention Framework – State Incentive Grant Program (SPF SIG) to fund operations targeting underage and binge drinking in youth and young adults as part of the Westside Impact Project managed by the Institute for Public Strategies (IPS).

Additional funds became available since that time. IPS offered funds in the amount of $9,600 to the Santa Monica Police Department to fund an additional four operations targeting underage and binge drinking in youth and young adults. These funds must be spent by June 30, 2015.

Background

The SPF SIG program is a federal grant administered by the U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administration (SAMHSA). SAMHSA allocates the grant funds to the California Department of Alcohol and Drug Programs who then allocate a portion of the state funds to the County of Los

1 Angeles Department of Public Health, Substance Abuse Prevention and Control to fund the Westside Impact Project. No local match is required.

The Westside Impact Project is being led by the Institute for Public Strategies (IPS), a non-profit organization based in Los Angeles County. The Westside Impact Project provides grant funding to Santa Monica for operations targeting underage and binge drinking in youth and young adults.

Discussion In September 2010, The California Department of Alcohol and Drug Programs (ADP) was awarded a Strategic Prevention Framework State Incentive Grant (SPF SIG) from the U.S. Department of Health & Human Services’ Substance Abuse and Mental Health Services Administration’s Center for Substance Abuse Prevention (CSAP). The SPF SIG is intended to build prevention capacity and infrastructure at the state and local levels; prevent the onset and reduce the progress of substance abuse including childhood and underage drinking; and reduce substance abuse and substance abuse related problems in communities.

The priority of California’s SPF SIG is to reduce underage and excessive drinking among youth and young adults ages 12 to 25 years old. As required by the SPF SIG, project communities were selected based on a data-driven needs assessment process that compared county and state level indicators of substance abuse, its prevalence and its consequences.

Based on this strategic plan, state funds were allocated to the County of Los Angeles Department of Public Health, Substance Abuse Prevention and Control to fund the Westside Impact Project. The County of Los Angeles identified the Institute for Public Strategies (IPS) to fill that role of community partner who will implement and manage the Westside Impact Project. IPS was awarded $95,000 in annual funding for three

2 federal fiscal years and had originally allocated $48,000 in funding to SMPD for enforcement operations. Santa Monica was identified as one of the project communities to receive grant funding based on criteria including demographic characteristics, alcohol problem indicators, and ability to effectively implement the components of the program. Due to administrative delays, the Westside Impact Project launched late and IPS is currently in the process of rolling over funds in order to spend within the federal grant performance period. As part of this effort, in February 2015 IPS offered the Santa Monica Police Department an additional $9,600 in grant funding. Santa Monica Police Department was selected to receive the additional $9,600 in funding based on the number of operations that could reasonably be completed within the additional two month time frame. Twelve cities with populations between 50,000 and 500,000 are part of the Westside Impact project and were eligible to receive rollover funds with the exact amounts varying based on time available to complete the operations.

The Santa Monica program is being implemented by the Santa Monica Police Department’s Criminal Investigation Divisions (CID) – Vice and School Resource Officer Units. CID is currently using the grant award to conduct 20 operations targeting underage drinking and excessive drinking among youth and young adults ages 12 to 25 years old. CID’s aim is to provide education and enforcement to reduce the illegal purchasing, distribution and consumption of alcoholic beverages by minors. These efforts are consistent with the City’s Cradle to Career initiative. With the added $9,600 in grant funding, CID would be able to fund an additional four operations for a total of 24. The operations would be completed by June 30, 2015.

Financial Impacts & Budget Actions Award of an additional $9,600 from the Strategic Prevention Framework – State Incentive Grant Program (SPF – SIG) requires the following FY 2014-15 budget changes: 1. Increase revenue budget at account 20304.406101 in the amount of $9,600

3 2. Appropriate the following operating expenditures to reflect receipt of the SPF – SIG funds: $9,600 at account 20304.569101

Prepared by: Nicole Dibling-Moore, Senior Administrative Analyst

Approved: Forwarded to Council:

Jacqueline A. Seabrooks Elaine Polachek Chief of Police City Manager

4 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 3-E To: Mayor and City Council From: Dean Kubani, Manager, Office of Sustainability and the Environment Subject: Second Modification to Professional Services Agreement for Web Development and Content Management Services

Recommended Action Staff recommends that the City Council authorize the City Manager to negotiate and execute a second modification to professional services agreement #2221 in the amount of $15,000 with John Oakes, a California-based consultant, to provide web development and content management services. This will result in a four-year amended agreement with a new total amount not to exceed $95,000.

Executive Summary The Office of Sustainability and the Environment (OSE) manages an active outreach and communications effort to promote the City’s environmental and sustainability programs. The OSE website is the cornerstone for these efforts and needs regular maintenance and updating, requiring resources beyond those available in-house. More work than expected is required this year as a result of web updates from the drought response and launching an open data site for Sustainable City Plan data. Therefore, staff recommends Council authorize a second modification of the professional services agreement with Mr. Oakes through June 30, 2015 in an amount not to exceed $95,000.

Background OSE maintains a website, sustainablesm.org, to provide the community and stakeholders valuable, current information about the City’s sustainability programs, including water conservation, energy efficiency, and green building. Ongoing updates and maintenance of the content on the website require a level of effort beyond that available in-house. In order to ensure that OSE could build out and maintain its website, OSE consulted with Information Systems Department (ISD) staff and determined that an outside resource was needed to provide web development and content management services.

1 In 2011, OSE and ISD requested and evaluated bids from local web service vendors. John Oakes provided the best bid as determined by price, ability to meet City specifications and technical skill.

Discussion As a result of the City drought response and the upcoming launch of an open data portal for Sustainable City Plan data, additional web development services are now required beyond maintenance of the existing OSE website. Staff recommends adding $15,000 to the agreement with Mr. Oakes to allow for completion of anticipated additional work through the rest of this fiscal year. OSE plans to formally bid for communication services, including web content services, for future years later this year.

Vendor Selection In March 2011, the City published an informal Request for Quotes to provide web development and content management services as requested by OSE in accordance with City specifications. The bid was emailed to 28 vendors. Four bids were received and publicly opened on March 31, 2011. Bids were evaluated based on the criteria in SMMC 2.24.072, including price, ability to meet City specifications, technical ability, and experience. John Oakes was the lowest bidder, met the City specifications, and had the required technical skills. Based on these criteria, Mr. Oakes was recommended as the best bidder to provide web development and content management services in accordance with the City specification.

The City entered into a professional services agreement with Mr. Oakes in April 2011 for an amount not to exceed $65,000. This contract was amended in May 2014 to extend the contract until June 30, 2015 and to add $15,000 for additional work. Because of the additional work that is needed, the agreement will exceed the purchasing threshold for professional services agreements and, therefore, requires Council authorization for the first time.

Financial Impacts & Budget Actions This agreement modification to be awarded to John Oakes is $15,000 for an amended agreement total not to exceed $95,000. Funds are available in the FY 2014-15 budget in the City Manager's Office Department. The agreement will be charged to account 01226.555060.

Prepared by: Christopher Smith, Principal Administrative Analyst

Approved: Forwarded to Council:

Dean Kubani Elaine Polachek Manager, Office of Interim City Manager Sustainability and the Environment

3 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 3-F To: Mayor and City Council From: Susan Cline, Interim Director of Public Works Subject: Professional Services Agreement for Transportation and Parking Service (TAPS) Center Tenant Improvement Project at Parking Structure No. 5

Recommended Action Staff recommends that the City Council: 1. Award Request for Proposals (RFP) SP#2363 to Studio Jantzen, a California- based architectural design firm, to provide design services for the Transportation and Parking Services Center (TAPS) Tenant Improvement project located on the ground floor of the Parking Structure No. 5. 2. Authorize the City Manager to negotiate and execute a professional services agreement with Studio Jantzen in an amount not to exceed $252,698 (includes an 8.5% contingency). 3. Authorize the budget changes listed in the Financial Impacts and Budget Actions section of this report. 4. Authorize the Director of Public Works to issue any necessary modifications to complete additional work within budget authority.

Executive Summary This agreement would provide design services for Tenant Improvements (TI) at the Transit and Parking Services Center (TAPS) on the ground level of Parking Structure No. 5 at 1440 4th Street. On November 19, 2014, the City published a Request for Proposals (RFP) for design services for the TAPS project. After reviewing proposals, staff recommends Studio Jantzen to provide design services for the TAPS project in an amount not to exceed $252,698.

Discussion The ground floor of Parking Structure No. 5 has been utilized as commercial space and storefronts for many years. In April 2014, the Big Blue Bus (BBB) closed its retail store on Broadway and moved into a 600-square foot space on the site shared with the City’s parking contractor, Central Parking, Inc. This is the only downtown location where BBB customers can obtain bus passes and route information. Central Parking also operates 1 its business from the space such as ticket dispute and payment. The shared space is insufficient to handle the volume of staff and customers which can be as high as 300 daily for both Central Parking and the BBB.

This TI project would combine and convert the existing commercial spaces into the TAPS center, public restrooms and one small retail space for lease. The location of this facility is approximately one block from the Expo terminus which will not have public restrooms. The restrooms would serve light rail and BBB riders, parking patrons and downtown visitors alike. The project would bring the facility up to current accessibility standards, locate the public restrooms along the street frontage for transit service customers, and update the aging storefronts which would enhance the pedestrian experience. The TAPS project would facilitate customer services through co-location of the BBB, the City’s parking office and the City’s parking operator contractor, and provide a one-stop shop for buying bus passes, obtaining bus information, and resolving parking ticket disputes in addition to providing public restroom facilities.

Consultant Selection On November 19, 2014, the City issued a Request for Proposals (RFP) for architectural and engineering design services for the TAPS TI project. The RFP was posted on the City’s online bidding website and notices were advertised in the Santa Monica Daily Press in accordance with the City Charter and Municipal Code provisions. A total of 81 vendors were notified and 61 vendors downloaded the RFP. Eight proposals were received and publicly opened on December 19, 2014.

Staff from Public Works and Housing and Economic Development reviewed all proposals and short-listed four firms for interviews: Gwynn Pugh Urban Studio, Howard Laks Architects, Michael Folonis Architects, and Studio Jantzen. On January 26, 2015, interviews were held by staff from Public Works, Housing and Economic Development, Big Blue Bus and a representative from Downtown Santa Monica, Inc. Proposals were evaluated on relevant experience, project approach, strength of the project team, quality of the design portfolio, and proposed cost. After interviewing the four short-listed firms,

2 staff selected Studio Jantzen as the best qualified firm to design the project.

Based on Studio Jantzen’s recently completed project with the City at Parking Structure No. 6, the strength of the consultant team, references, competitive rates compared to other proposals submitted, as well as their understanding and approach to the design solution, staff recommends Studio Jantzen to provide design services for the TAPS Parking Structure No. 5 Tenant Improvement project at a cost not to exceed $252,698.

Next Steps The schematic design is scheduled to begin in April with the final design work completed by the end of 2015. Staff will return to Council for award of a construction contract. The construction is scheduled to begin in August of 2016 with the completion anticipated in early 2017. Funding for the construction of the additional scope will be requested in the Exception-Based FY 2015-16 CIP budget process for Council’s review and approval.

3 Financial Impacts and Budget Actions The agreement to be awarded to Studio Jantzen is for an amount not to exceed $252,698 (includes an 8.5% contingency). Funds in the amount of $84,000 are available in the FY 2014-15 Capital Improvement Program (CIP) budget in account C010162.589000. Award of the agreement requires the following budget actions in FY 2014-15.

1. Release of $168,698 fund balance from reserve account 4.365901 (FB - Res - Mall Parking Levy). 2. Appropriation of $168,698 to account C040162.589000.

The agreement will be charged to the following accounts: C010162.589000 $ 84,000 C040162.589000 $168,698 TOTAL $252,698

Prepared By: David Wang, Architectural Associate

Approved: Forwarded to Council:

Susan Cline Elaine M. Polachek Interim Director of Public Works Interim City Manager

4 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 3-G To: Mayor and City Council From: Edward F. King, Director of Transit Services Subject: Low Carbon Transit Operations Program Resolution

Recommended Action Staff recommends that the City Council adopt the attached resolution for the Low Carbon Transit Operations Program.

Executive Summary The Low Carbon Transit Operations Program (LCTOP) is one of several programs that are part of the Transit, Affordable Housing, and Sustainable Communities Program established by the California Legislature in 2014 via Senate Bill 862. The LCTOP was created to provide operating and capital assistance for transit agencies to reduce greenhouse gas emissions and improve mobility, with a priority on serving disadvantaged communities. As a requirement for funding, a resolution must be submitted.

Discussion SB 862 (2014) establishes the LCTOP as a new formulaic program instead of a state- level competitive program. The LCTOP uses the existing State Transit Assistance (STA) Fund formula to distribute $25 million statewide. The STA formula has two components, a population share and a revenue share. Metro receives all of the population share while the revenue share is split between the Los Angeles County Municipal Operators and Metro. The California Department of Transportation (Caltrans) is responsible for ensuring that the statutory requirements of the program are met in terms of eligibility, greenhouse gas reduction, disadvantaged community benefit, and other requirements of law.

The LCTOP guidelines describe the process that transit agency recipients must follow to qualify and receive a share of the fund. These funds are available to provide

1 operations, maintenance, and capital assistance for transit agencies with the goals of reducing greenhouse gas emissions, improving mobility for the California public, and include a priority to serve disadvantaged communities. The LCTOP is a new ongoing funding source for the Big Blue Bus.

The new LTCOP funds would bring approximately $131,000 to the Big Blue Bus to be used for operating purposes, such as but not limited to fuel, maintenance and salaries. As a requirement for funding, a resolution, certification and assurances, and a project description and allocation request form must be submitted. The resolution would authorize the City Manager to execute the required documents for funding.

Big Blue Bus (BBB) is seeking to submit the required forms for disbursement by the April 15, 2015 due date.

Financial Impacts & Budget Actions There is no immediate financial impact or budget action necessary as a result of the recommended action. Staff will return to Council if specific budget actions are required in the future. Staff anticipates that BBB will receive approximately $131,000 annually to be used to cover operating expenses.

Prepared by: Enny Chung Graham, Senior Administrative Analyst

Approved: Forwarded to Council:

Edward F. King Elaine M. Polachek Director of Transit Services Interim City Manager

Attachments: 1. Resolution

2 City Council Meeting: March 24, 2015 Santa Monica, California

RESOLUTION NUMBER ______(CCS)

(City Council Series)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA TO AUTHORIZE THE CITY MANAGER FOR THE AUTHORIZATION FOR THE EXECUTION OF THE CERTIFICATIONS AND ASSURANCES FOR THE LOW CARBON TRANSIT OPERATIONS PROGRAM (LCTOP)

WHEREAS, the City of Santa Monica’s Big Blue Bus is an eligible project

sponsor and may receive state funding from the Low Carbon Transit Operations

Program (LCTOP) now or sometime in the future for transit projects; and

WHEREAS, the statues related to state-funded transit projects require a local or regional implementing agency to abide by various regulations; and

WHEREAS, Senate Bill 862 (2014) named the Department of Transportation

(Department) as the administrative agency for the LCTOP; and

WHEREAS, the Department has developed guidelines for the purpose of administering and distributing LCTOP funds to eligible project sponsors (local agencies); and

1 WHEREAS, the City of Santa Monica’s Big Blue Bus wishes to delegate authorization to execute these documents and any amendments thereto the City

Manager of City of Santa Monica.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA

DOES RESOLVE AS FOLLOWS:

SECTION 1. The fund recipient agrees to comply with all conditions and requirements set forth in the Certification and Assurances document and applicable statues, regulations and guidelines for all LCTOP funded transit projects.

SECTION 2. The City Manager is authorized to execute all required documents of the LCTOP program and any amendments thereto with the California Department of

Transportation.

SECTION 3. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect.

APPROVED AS TO FORM:

______MARSHA JONES MOUTRIE City Attorney

2 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 3-H To: Mayor and City Council

From: David Martin, Director, Planning and Community Development

Subject: Resolution Approving Final Tract Map No. 60419 for a 10-Unit Condominium Project at 1803 16th Street.

Recommended Action Staff recommends that the City Council adopt the attached resolution approving Final Tract Map No. 60419.

Executive Summary This report transmits for City Council approval a Final Tract Map for the following condominium project. The Tentative Tract Map was approved by the Planning Commission on March 21, 2012.

TRACT MAP ADDRESS SUBDIVIDER UNITS

No. 60419 1803 16th Street Steven Stapakis 10

Background A Design Compatibility Permit application for the development of a 11-unit condominium project was submitted on September 11, 2003, and the required Tentative Tract Map application was subsequently submitted to the City on February 9, 2004. Through extensive work with the applicant on the project design the proposed number of units was reduced to ten. An Environmental Impact Report (EIR) prepared for the project determined that there would be significant and unavoidable impacts to traffic that could not be mitigated to a less than significant level. As such, a Statement of Overriding Considerations was adopted for the project. All other impacts identified in the EIR were able to be mitigated to a less than significant level with the implementation of mitigation measures and the associated Mitigation Monitoring Program. 1

After a public hearing and careful review of the record and staff recommendations, the Planning Commission approved a Tentative Tract Map for the 10-unit condominium project on March 21, 2012.

Discussion The action of the Planning Commission at its March 21, 2012, public hearing was based on its findings that the proposed subdivision complies with all state and local laws and regulations, and applicable General Plan Elements. The Final Map conforms to the Tentative Map. The developer will be required to show proof of the one-time payment of the condominium tax of $1,000 per unit (i.e. $10,000 total) prior to the issuance of building permit. The Final Map has been approved by the Los Angeles County Engineer’s office and certified by the City Engineer for conformance with the Tentative Map and conditions thereon, the Subdivision Map Act and local ordinances. The City Engineer’s office indicates that the off-site public improvements required include, 1) replacing the existing asphalt alley adjacent to the subject property with concrete, 2) removing an entrance on 16th Street, and 3) replacing the curb and sidewalk in the vicinity. The City Attorney's office has approved the Covenants, Conditions and Restrictions for the Final Map as complying with the conditions of the Tentative Map and applicable laws.

Financial Impacts & Budget Actions The recommendation presented in this report does not have a budget or fiscal impact.

Prepared by: Ariel Socarras, Associate Planner

Approved: Forwarded to Council:

David Martin, Director Elaine Polachek Planning & Community Development Interim City Manager

Attachments: A. Resolution 2 RESOLUTION NO. ______(ccs)

(City Council Series)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA ACCEPTING AND APPROVING THE FINAL SUBDIVISION MAP FOR TRACT NO. 60419 TO SUBDIVIDE A PROPERTY AT 1803 16th STREET

THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS:

SECTION 1. That the Final Map for Tract No. 60419 in the City of Santa Monica is hereby accepted and approved.

SECTION 2. That the City Clerk hereby is authorized and directed to endorse upon the face of said Map this order authenticated by the Seal of the City of Santa Monica.

SECTION 3. That the City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect.

APPROVED AS TO FORM:

______MARSHA JONES MOUTRIE City Attorney

3 RESOLUTION NO. ______(ccs)

(City Council Series)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA ACCEPTING AND APPROVING THE FINAL SUBDIVISION MAP FOR TRACT NO. 60419 TO SUBDIVIDE A PROPERTY AT 1803 16th STREET

THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS:

SECTION 1. That the Final Map for Tract No. 60419 in the City of Santa Monica is hereby accepted and approved.

SECTION 2. That the City Clerk hereby is authorized and directed to endorse upon the face of said Map this order authenticated by the Seal of the City of Santa Monica.

SECTION 3. That the City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect.

APPROVED AS TO FORM:

______MARSHA JONES MOUTRIE City Attorney

1 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 7-A To: Mayor and City Council

From: Marsha Jones Moutrie, City Attorney

Subject: Ordinance Amending Chapter 4.04 of the Santa Monica Municipal Code Prohibiting Certain Animals in Certain Public Places

Recommended Action Staff recommends that the City Council adopt the attached ordinance.

Executive Summary At its meeting on February 24, 2015 the City Council introduced for first reading an ordinance amending Chapter 4.04 of the Santa Monica Municipal Code prohibiting certain animals in certain public places. The ordinance is now presented to the City Council for adoption.

Prepared by: Marsha Jones Moutrie, City Attorney

Approved: Forwarded to Council:

Marsha Jones Moutrie Elaine Polachek City Attorney Interim City Manager

Attachment: Ordinance

1 City Council Meeting: March 24, 2015 Santa Monica, California

ORDINANCE NUMBER ______(CCS)

(City Council Series)

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA AMENDING CHAPTER 4.04 OF THE SANTA MONICA MUNICIPAL CODE PROHIBITING CERTAIN ANIMALS IN CERTAIN PUBLIC PLACES

WHEREAS, the City consists of just eight square miles of coastal land which is

home to 90,000 residents, the job site of 300,000 workers, and a destination for as

many as 500,000 visitors on weekends and holidays; and

WHEREAS, because the City is both densely populated and visitor serving, its

public spaces often become extremely crowded; and

WHEREAS, the City’s park space is limited; and

WHEREAS, public beaches and City parks are congested public recreational

facilities that are heavily used by residents, workers and visitors; and

WHEREAS, the Pier is a long and narrow space, only 35 feet wide at some points, with ingress and egress at only one end; and

WHEREAS, the Third Street Promenade and the Transit Mall are located at the heart of the City’s busy Downtown District; and

WHEREAS, all of these public spaces are heavily patronized by the public year round and congestion in these confined places is a constant norm; and

WHEREAS, because each of these public resources are limited and heavily utilized, special efforts must be undertaken to maintain them and facilitate their shared

1 use and availability to all; and

WHEREAS, the intensity and variety of park and beach uses further necessitates

regulation to avoid safety hazards and conflicts; and

WHEREAS, disruptive activities within the City’s public spaces interfere with the general public’s use and enjoyment of these public facilities and damages the public

welfare; and

WHEREAS, the presence of non-domesticated, and potentially vicious, ferocious

or dangerous animals within these congested public spaces constitutes a serious

danger to public health, safety and welfare; and

WHEREAS, City Staff has witnessed persons having control over monkeys,

birds, snakes or other reptiles toss such animals onto unsuspecting members of the

public, while on public property, as a way of requesting payments from such members

of the public; and

WHEREAS, such animals have assaulted members of the public while on public

property; and

WHEREAS, the City Council finds that it is necessary to prohibit such animals

from the City’s most congested public spaces in order to protect the public’s safety and

to promote the general welfare.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA

DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Section 4.04.162 of the Santa Monica Municipal Code is hereby

added to read as follows:

2 4.04.162 Prohibition of Certain Animals on Public Property.

(a) It shall be unlawful for any person having control, charge or custody of any snake or other reptile, non-human primate (such as chimpanzees and monkeys), or bird to permit such animal to be in or upon any City park, the beach, Ocean Front Walk, the Pier, the Pier ramp, the Third Street Promenade, the Transit Mall, and the public sidewalks and parkways immediately adjacent to any City Park.

(b) The following activities shall be exempt from the prohibitions contained in this Section:

(1) Any person interacting with animals naturally inhabiting the public property; or

(2) Any person transporting animals within a vehicle traveling on the public street; or

(3) Governmental personnel operating on public property to protect public health, safety or welfare; or

(4) Any other activity authorized by federal or California state law.

SECTION 2. Section 4.04.166 of the Santa Monica Municipal Code is hereby amended to read as follows:

Notwithstanding the prohibitions contained in Municipal Code Sections 4.04.150,

4.04.155, 4.04.160, and 4.04.162, animals may be present on public property in accordance with the terms and conditions of a community events permit or film permit issued by the City.

3 SECTION 3. Section 4.04.520 of the Santa Monica Municipal Code is hereby added to read as follows:

4.04.520 Enforcement

(a) Unless otherwise specifically provided, any person violating any provision of this Chapter shall be guilty of a misdemeanor, which shall be punishable by a fine not exceeding five hundred dollars per violation, or imprisonment in the County Jail for a period not exceeding six months, or by both fine and imprisonment, or shall be guilty of an infraction, which shall be punishable by a fine not exceeding two hundred fifty dollars.

(b) Any person violating any provision of this Chapter or any rule or regulation may be subject to administrative citations pursuant to Chapter 1.09 of this Code.

SECTION 4. Any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance.

SECTION 5. If any section, subsection, sentence, clause, or phrase of this

Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause,

4 or phrase not declared invalid or unconstitutional without regard to whether any portion

of the ordinance would be subsequently declared invalid or unconstitutional.

SECTION 6. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall become effective 30 days from its adoption.

APPROVED AS TO FORM:

______MARSHA JONES MOUTRIE City Attorney

5 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 7-B To: Mayor and City Council

From: Marsha Jones Moutrie, City Attorney

Subject: Ordinance Reducing the Membership of the Arts Commission From Thirteen to Eleven Members

Recommended Action Staff recommends that the City Council adopt the attached ordinance.

Executive Summary At its meeting on February 24, 2015 the City Council introduced for first reading an ordinance reducing the membership of the Arts Commission from thirteen to eleven members. The ordinance is now presented to the City Council for adoption.

Prepared by: Marsha Jones Moutrie, City Attorney

Approved: Forwarded to Council:

Marsha Jones Moutrie Elaine Polachek City Attorney Interim City Manager

Attachment: Ordinance

1 City Council Meeting: March 24, 2015 Santa Monica, California

ORDINANCE NUMBER ______(CCS)

(City Council Series)

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA REDUCING THE MEMBERSHIP OF THE ARTS COMMISSION FROM THIRTEEN TO ELEVEN MEMBERS

WHEREAS, the Santa Monica Arts Commission was created to "ensure a regular and ongoing assessment of art programs in the City"; and

WHEREAS, in order to ensure representation of diverse interests within the City, the Commission was created as an unusually large legislative body, numbering thirteen members; and

WHEREAS, experience has indicated that a slightly smaller body could fulfill the

Commission's purpose equally well and much more efficiently; and

WHEREAS, Council has determined that the Commission's size should be reduced, and

WHEREAS, there are currently two vacancies on the Commission, and

1 WHEREAS, the present circumstances provide an unusual opportunity to adjust the size of the Commission without disrupting members' service.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA

DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Santa Monica Municipal Code Section 2.64.020 is hereby amended to read as follows:

2.64.020 Creation of Arts Commission.

(a) Pursuant to Section 1000 of the City Charter, an

Arts Commission is created. The Commission shall consist

of eleven members. A majority of the members in office at

any time shall constitute a quorum. The members shall be

appointed by the City Council. Except as otherwise provided

in this Chapter, the Commission and Commissioners shall

be subject to all the terms of Article X of the City Charter

setting forth procedures for appointment of Commissioners,

terms, and meetings.

(b) Except as otherwise provided in Section

2.64.080, all Commissioners shall reside or work in the City

and shall be actively involved in the arts. From and after

April 10, 1990, any person appointed as a Commissioner

must be a Director of the Santa Monica Arts Foundation. The

Commission shall represent the diversity of the community

2 and shall include minorities and working artists in the

following disciplines:

(1) Performing arts such as drama, music, and

dance.

(2) Visual arts such as painting, sculpture,

photography, graphics, video art, and applied art.

(3) Communications arts such as film, television,

and radio.

(4) Literary arts such as literature, poetry, and

journalism.

Commissioners may represent one or more of the

disciplines indicated above.

SECTION 2. Any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance.

SECTION 3. If any section, subsection, sentence, clause, or phrase of this

3 or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional.

SECTION 4. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall become effective 30 days from its adoption.

APPROVED AS TO FORM:

______MARSHA JONES MOUTRIE City Attorney

4 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 7-C To: Mayor and City Council

From: Marsha Jones Moutrie, City Attorney

Subject: Ordinance Adopting Local Modifications to the Method of Levying Assessments Pursuant to the Property and Business Improvement District Law of 1994

Recommended Action Staff recommends that the City Council adopt the attached ordinance.

Executive Summary At its meeting on March 17, 2015, the City Council introduced for first reading an ordinance adopting local modifications to the method of levying assessments pursuant to the property and business improvement district law of 1994. The ordinance is now presented to the City Council for adoption.

Prepared by: Marsha Jones Moutrie, City Attorney

Approved: Forwarded to Council:

Marsha Jones Moutrie Elaine Polachek City Attorney Interim City Manager

1 City Council Meeting: March 24, 2015 Santa Monica, California

ORDINANCE NUMBER ______(CCS)

(City Council Series)

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA ADOPTING LOCAL MODIFICATIONS TO THE METHOD OF LEVYING ASSESSMENTS PURSUANT TO THE PROPERTY AND BUSINESS IMPROVEMENT DISTRICT LAW OF 1994

WHEREAS, property and business owners have expressed their desire to obtain the benefits of enhanced services and improvements through the mechanism of assessment financing; and

WHEREAS, the Property and the Business Improvement District Law of 1994

(the “State Law”) authorizes the establishment of assessment districts for the purpose of providing the special benefits of enhanced services and improvements to property owners and business owners; and

WHEREAS, the State Law expressly authorizes charter cities to modify the method of establishing a district pursuant to the State Law; and

WHEREAS, authorizing modifications to the provisions of the State Law governing the petition threshold will promote the welfare of the City by increasing the flexibility and utility of the State Law so that petitions may be more readily initiated, thereby facilitating the initiation of the district establishment process and enhancing

1 opportunities for property and business owners to receive additional services and improvements benefitting their area.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA

DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Santa Monica Municipal Code Section 2.38.030 is hereby amended

to read as follows:

2.38.030 Petition threshold.

Notwithstanding Streets and Highways Code Section

36621(a) or any other provision of state law, the City Council

may initiate proceedings to establish a property and

business improvement district upon receipt of a petition

signed by property owners, business owners, or a

combination of property owners and business owners in the

proposed district who will pay at least forty percent of the

assessments proposed to be levied.

SECTION 2. Any provision of the Santa Monica Municipal Code or appendices

thereto inconsistent with the provisions of this Ordinance, to the extent of such

inconsistencies and no further, is hereby repealed or modified to that extent necessary

to effect the provisions of this Ordinance.

SECTION 3. If any section, subsection, sentence, clause, or phrase of this

Ordinance is for any reason held to be invalid or unconstitutional by a decision of any

court of competent jurisdiction, such decision shall not affect the validity of the

2 remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion

of the ordinance would be subsequently declared invalid or unconstitutional.

SECTION 4. The Mayor shall sign and the City Clerk shall attest to the passage

of this Ordinance. The City Clerk shall cause the same to be published once in the

official newspaper within 15 days after its adoption. This Ordinance shall become

effective 30 days from its adoption.

APPROVED AS TO FORM:

______MARSHA JONES MOUTRIE City Attorney

3 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 8-A To: Mayor and City Council From: Marsha Jones Moutrie, City Attorney Susan Cline, Interim Director of Public Works

Subject: The Santa Monica Airport And Future Options Regarding Its Operations And The City's Use Of The Land Now Occupied By The Airport

Recommended Action

Staff recommends that the City Council review and comment on future options regarding operation of the Santa Monica Airport ("Airport" or "SMO") and the City's future use of its land currently occupied by the Airport and direct staff to:

1) Continue with a full range of planning, environmental and legal work that would enable the City to determine the future use of the City's land, including possible closure of all or part of the Airport; such work to include, but not be limited to, pursuing legal resolution of issues relating to control of the land, undertaking preliminary environmental and design work as to both the western parcel and the entire Airport, and assessing the possibility of a City-sponsored 2016 ballot measure;

2) Continue to implement measures to reduce adverse impacts of Airport operations, through imposing appropriate conditions in leases and any other lawful means;

3) Continue to promote Airport self-sufficiency to ensure that the Airport is not a drain on the general fund during this period of possible transition, including by: increasing any rents that may not be at market rate; renegotiating for Council approval expired master leases to address subleasing and thereby provide for the City's receipt of full revenues from the use of City property; and obtaining private assistance with leasing and property management;

4) Work to reduce and eliminate aviation uses of the land released from aviation use;

5) Negotiate and execute new leases with two current non-aviation subtenants (VW- Audi and Milstein), The Museum of Flying, Atlantic Aviation, and Krueger Aviation with lease terms expiring either three years from execution or by June 30, 2018, whichever date is earlier; and

1 6) Continue to receive, assess and provide recommendations based on community input on all aspects of Airport operations and use of the land now occupied by the Airport.

Executive Summary

Staff presented its last comprehensive report on issues related to the Airport on March 25, 2014. After hearing testimony from approximately 100 speakers, Council gave direction on contingency planning for the Airport's future, leasing, and evaluating options regarding fuel sales, among other things.

Much has happened since last March. The voters adopted one ballot measure related to the Airport and rejected another. New lawsuits about the Airport were filed against the City by aviation interests and residents. The Airport Commission adopted recommendations relating to emissions, leases and the Airport's future. But, some things did not change. The City is still fighting in court to establish its control over its own land. Residents remain concerned about safety and adverse environmental impacts. And, the debate continues about how the City land should be used if the Airport is reduced in size or closed.

This report summarizes the law and history that relate to and impact the City's ability to control the land now used for the Airport. It also provides information about the most significant developments of the last year, the Airport's current operations, and input received from the community and the Airport Commission.

The report includes a number of recommendations. Some of them involve continuing the City's current course of preliminary planning, environmental and legal work that would enable the City to determine the future use of the City land now occupied by the Airport, including possible complete or partial closure of the Airport, pursuing resolution of legal issues affecting the City's control of its own land, and maintaining the Airport's financial self-sufficiency.

Other specific recommendations relate to new opportunities that will arise this year with the expiration of the 1984 Settlement Agreement and all of the Airport leases. These include: working to eliminate aviation uses from the non-aviation land; implementing measures to reduce current adverse impacts of the Airport on the environment and residents through conditions in new or extended leases and through any other lawful means; ensuring that any submarket rents are increased; revising master leases to eliminate subleases or otherwise maximize the flow of revenue to the City (rather than to private interests); and assessing the possibilities for a 2016 ballot measure regarding potential future use of the Airport land. Staff also recommends negotiating five particular leases between the City and two aviation master lessors (Atlantic Aviation and Krueger Aviation), two current non-aviation subtenants of Atlantic (Volkswagen Audi and Milstein, Adleman & Kreeger), and The Museum of Flying.

Background The possibilities and options for the Airport's future and the City's future use of the land now occupied by the Airport are significantly impacted by legal constraints and certain aspects of the Airport's history. Both the law and the history were summarized in the March 25, 2014 and April 30, 2013 staff reports. However, the background information is provided again here and in somewhat greater detail because of the importance of the facts and law to the intensifying community debate about Airport issues. This section also provides information about current operations at the Airport and developments occurring during the last year, including an update on litigation, a summary of input received from the community, and the recommendations made by the Airport Commission.

The Legal Constraints: Federal Laws, FAA Regulations, Court and Agency Decisions, and Contracts The City of Santa Monica owns and operates the Santa Monica Airport ("SMO"). However, federal law imposes significant constraints on the City's authority to control Airport operations. A basic understanding of the law is necessary to assess the legal controversies about the Airport and the City's options as proprietor of the Airport and owner of the land now occupied by the Airport. The legal constraints fall into two general categories: laws and contracts.

Laws The United States Congress has adopted various federal statutes that govern aviation. The most important ones are codified in Title 49 of the United States Code. They include the Federal Aviation Act (Section 40103), the Airline Deregulation Act (Section 41713), the Airport and Airway Improvement Act (Section 47101), and the Airport Noise Capacity Act ("ANCA", Section 47523 and following). Among other things, the federal statutes create the Federal Aviation Administration ("FAA") and delegate to that agency broad authority over a wide variety of matters relating to aviation safety and air commerce. The FAA's realm of control includes the use and management of navigable 3 airspace, aviation safety, air traffic control, air navigation facilities and certain aspects of airport development and facilities, among other things.

The FAA exercises its authority under these statutes in several ways, including by promulgating a myriad of administrative regulations that implement the federal statutes and by enforcing those regulations on its own and in response to complaints from airport users. Regulations that have been particularly important to the City in recent years include the agency's Part 16 regulations, which establish a quasi-judicial procedure for challenging compliance with conditions attached to federal grants for Airport improvements, and the Part 161 regulations, which implement ANCA and establish procedures applicable to, among other things, changes in airport operations and noise management. The FAA's quasi-judicial proceedings generate a body of administrative decisions that interpret and apply the agency’s regulations.

In addition to promulgating administrative regulations and interpreting and enforcing them through quasi-judicial proceedings, the FAA also promulgates myriad directives and guidelines, which it treats as laws or binding regulations. One example is the Compliance Manual (FAA Order 5190-66), through which the FAA communicates its views as to how grantees should comply with FAA grant assurances, among other things.

In addition to adopting federal statutes that create the FAA and give it very broad powers, Congress has adopted other laws that constrain the City's authority over operation of the Airport. For instance, The Clean Air Act, 42 USC. Section 7573, provides: "No State or political subdivision thereof may adopt or attempt to enforce any standard respecting emissions of any air pollutant from any aircraft or engine thereof unless such standard is identical to a standard applicable to such aircraft under this part." This is an example of express federal preemption of local regulation: thus, the federal government fully occupies the field of establishing standards for aircraft engine emission.

Also, from time to time, courts issue decisions in cases involving the laws governing aviation and local control over airport operations. Like the federal statutes and regulations, this body of case law defines the rights and responsibilities of airport owners.

Despite establishing basic laws governing air transport and creating the FAA to protect the national aviation transportation system and promote aviation commerce, Congress has recognized that local airport owners have certain proprietary rights. However, Congress has not delineated the extent of those rights, leaving that task to the FAA and to the courts. Generally speaking, the courts have deferred to the agency’s view of proprietor’s rights, which is that such rights were, in the first instance, limited to noise regulation and that the field of noise regulation has been occupied by ANCA.

Contracts In addition to limits imposed on the City by statutes, regulations, court and agency decisions, and FAA directives and guidelines, the City's ability to control the use of the Airport (and the City land it occupies) is also subject to limitation by contractual obligations. Three particular contracts may currently impose such limitations.

The 1948 Instrument of Transfer is the form agreement that the federal government used to transfer its lease of the City's Airport back to the City after World War II. During the war, the City had leased its Airport to the federal government for a nominal sum in order to support the war effort. The leases eventually expired by their own when the war officially ended. But, before the actual expiration, the Instrument of Transfer was executed; and it contains language regarding future use of the land. The federal government claims that this language obligates the City to operate the Airport in perpetuity; and, if the City does not, then the Airport land "reverts" back to the federal government. The City strongly disputes this contention

5 The 1984 Settlement Agreement, which is also a contract between the City and the federal government, states that it resolved all legal disputes that existed between the City and the federal government in 1984. Among other things, the Settlement Agreement requires the City to operate the Airport until July 1st of this year, releases from exclusive aviation use certain land on the south side of the Airport, recognizes some local restrictions on flight operations (e.g., noise limits and prohibitions on two classes of patterned operations) and imposes certain leasing obligations on the City (e.g. maintaining a specified number of tie downs). The 1984 Agreement expires on June 30th of this year.

Additionally, the third contract which the federal government asserts limits the City's control over its land is the 1994 Airport Improvement Program grant agreement between the City and the FAA. Federal grants for airport improvements include standard grant conditions, known as "assurances", which impose restrictions that the grantee (the City) must abide for the useful life of improvements funded by the grant, not to exceed twenty years from the date of the acceptance of the grant. The conditions include the requirements that the City must operate the Airport and do so without unjust discrimination or "the creation of exclusive rights". The assurances are interpreted broadly by the FAA to protect the national air transport system and to restrict local control.

Under the 1994 grant agreement with the City, the FAA funded various improvements to the Airport, including a blast wall at the eastern end of the runway. In 2003, the grant agreement was amended to increase the amount of the grant to cover the actual construction costs of such improvements. Some contend that the 20-year grant assurance period runs from 2003, ends in 2023, and constrains the City's authority over the Airport and the City's land until then.

6 The Airport's History The City has always owned the land used for the Airport. The City purchased the bulk of the land by grant deed in 1926. And, over the next 20 years, the City took title to the balance by grant and quitclaim deeds.

In 1941, with the war raging in Europe, President Roosevelt declared a national emergency. To aid in the war effort, the City executed two leases, conveying possession of the entire eastern portion of the current Airport to the United States for nominal rents for the duration of the emergency. At that time, Douglas Aircraft ("Douglas") operated a huge aircraft factory on the south side of the Airport. At the height of its war-time operations, Douglas employed over 40,000 workers, making Santa Monica a “company town”. Residential neighborhoods grew up immediately adjacent to the Airport to house Douglas workers.

Beginning in 1945, the federal government used City funds to condemn the land that is the current western portion of the Airport so that it could build a new and longer runway. Later, the federal government quitclaimed the land to the City, thus conveying it without restrictions. The following year, the federal government declared its leasehold interests to be "surplus", and the City resumed maintaining and operating the Airport, even though the war-time leases remained in effect (because the federal government had not yet declared the emergency to be officially over). And, in August of 1948, the United States officially surrendered its leasehold interests, along with certain improvements and other assets by executing the Instrument of Transfer – a standard form widely utilized by the War Assets office to convey property interests the federal government possessed but no longer needed.

In 1952, President Truman declared that the national war emergency no longer existed. Consequently, twelve months later, the two Airport leases to the federal government expired by their own terms, ending the federal government's leasehold interests that the United States had transferred back to the City through the Instrument of Transfer.

The post War years brought significant changes. Douglas cut back operations and later left the Airport. And, the fleet mix changed with the advent of jet aircraft and their impacts. These developments radically changed the community’s relationship to the Airport. Neighbors now perceived Airport operations, particularly very noisy jet operations, as highly destructive to their quality of life. They sued the City, and the California Supreme Court held that the City could be liable under legal theories including nuisance. Nestle v. City of Santa Monica, 6 Cal.3d 920 (1972).

The City Council responded to neighbors' complaints and liability risks by adopting local regulations restricting operations to protect neighbors' quality of life. "No jets" signs appeared around the Airport. Aviation interests and the Federal government challenged the restrictions. Litigation followed, most notably Santa Monica Airport Assoc. v. City, 659 F.2d 100 (1981) in which a coalition of Airport users challenged various City ordinances. All but one of the ordinances were upheld based on the City's powers as Airport proprietor. The decisions in that case do not define the full extent of those powers, but the court indicated that the City can regulate other adverse impacts in addition to noise. More litigation was filed, compelling the City to defend cases filed by the federal government, Airport neighbors, and Airport businesses.

Finally, in 1984, the City and the federal government entered into an agreement to settle all of their legal disputes. The 1984 Settlement Agreement allowed the City to make substantial changes in the operation of the Airport. For instance, the Agreement approved a new Airport Layout Plan that shifted a substantial portion of the aviation services from the south side of the Airport to the north side, where the businesses would be further from residences. This reconfiguration made available a substantial amount of land on the south side designated in the new layout plan as "parkland and residual land". Thus, the land was released from exclusive aviation use and identified for non-aviation uses. The City agreed to a new 30-year commitment to improve the

8 Airport's layout as shown in the Layout plan and to operate and maintain the Airport as a "viable functioning facility … until July 1, 2015."

Also during the post War years, the City accepted several grants from the federal government for Airport improvements. The last grant agreement was signed in 1994. The City did not accept additional grant offers after that because it intended that all Airport leases and grant conditions would expire in 2014 or 2015, when the obligation to operate the Airport, established by the 1984 Settlement Agreement, would expire. In 1998, the FAA expressly acknowledged that the 1984 Settlement Agreement "makes clear that the City is obligated to operate the Airport only for the duration of the Agreement (through July 1, 2015)”; and, after that date, the future use of the Airport land would be "a local land use matter ".

The 1990's also brought new changes to the fleet mix with the proliferation of business jets. This sparked new rounds of controversy. Neighbors living at the runway’s eastern end sued the City claiming, among other things, that noise, fumes and jet blasts were destroying their quality of life, imperiling their health and impacting their property values.

In 2001, soon after a fatal crash in which a plane exploded into flames just across 26th Street from single family homes, the City Council commissioned a study to address the safety and liability risks inherent in the relatively short length of the Airport runway, the proximity of homes to the runway ends, and the increase of larger/faster Category C and D aircraft traffic. The study recommended and Council eventually approved an Airport Conformance Program which would restrict Airport usage to Category A and B aircraft, and be better suited to safe use of the runway facilities.

The City's Aircraft Conformance Program was intended to conform Airport usage to the Airport's physical constraints, particularly the relatively short length of its runway. Before implementing that plan, the City attempted to reach an agreement with the FAA about limiting Airport usage. Those attempts failed. And, in 2008, Council adopted an

9 ordinance prohibiting Category C and D Aircraft. The FAA issued an Order to Show Cause ("OSC"), seeking to prohibit City enforcement of the ordinance. In the Order to Show Cause the FAA asserted that the Instrument of Transfer obligates the City to maintain the Airport "in perpetuity" and that the City's Airport land would revert to the United States if the City tried to close the Airport. A federal district court issued an injunction enforcing the OSC. The FAA determined that the Airport is "safe" and concluded that the jet ban violated the grant assurances. And, a federal appellate court upheld the agency determination.

In August of 2011, a student pilot overshot the runway on landing and crashed into the back of a home located about a block west of the runway end. Fortunately, the resident was not home. Workers who were on the property extinguished a fire. The homeowner subsequently sued the City. The crash exacerbated neighbors' concerns about runway safety.

Also in 2011, after a preliminary initial study by the Rand Corporation, the Council directed staff to undertake a three-phase, comprehensive visioning process to identify any and all options for the Airport's future that lay between the extremes of maintaining the status quo and total closure. Phase I, which consisted of a preliminary interview process, concluded with a report to Council on October 4, 2011.

Phase II began in early 2012. It included thirty community discussion groups. Over 300 community members and others participated, making this the largest, in depth public process ever undertaken by the City. The report on that process and the raw data were presented to the Council on May 8, 2012. In summary, the City's consultant distilled the community input into three different views about what the City should do: (1) try to close the Airport unless the FAA agrees to operational limitations sufficient to significantly mitigate adverse impacts on surrounding neighborhoods; (2) maintain the Airport only if operations and the Airport "footprint" are significantly reduced because it has outgrown its residential setting; and

10 (3) keep the Airport as a potential City asset if mitigation measures reduce adverse impacts because litigation results are uncertain, repurposing the land would likely include land development that would exacerbate traffic problems, and if Santa Monica Airport ("SMO") closes, Los Angeles International Airport traffic would potentially overfly the City at lower altitudes, increasing noise.

Phase III of the visioning process included, among other things, continuation of the community dialogue, assessment of possibilities for transforming SMO into a model "Green" airport, making physical improvements at the Airport, evaluating possible design improvements for the non-aviation land, and continuing communications with the FAA about any possibilities for mitigating adverse impacts. Staff's report on Phase III went to Council on April 30, 2013. That report described environmental improvements made at the Airport, re-evaluation of the noise contours, intermittent discussions with FAA personnel, testing of aftermarket exhaust mufflers, analysis of patterned flying and a landing fee study. Staff recommendations included, among other things, adopting a resolution increasing landing fees to make the Airport more self-sustaining, broadening their applicability to include all aircraft, and developing a pilot program for retrofitting with mufflers aircraft used in flight training. Council approved these recommendations and gave various directions including attempting to mitigate impacts through the City's own efforts and contacts with the FAA and obtaining resolution of legal issues, among other things.

In September of 2013, a business jet veered off of the runway on landing, crashed into a storage hangar located near the northwest Airport boundary, and exploded into flames. The pilot and all three passengers were killed. Neighbors living very near the runway and the crash site expressed renewed fears for their safety. The following month, the City filed suit against the FAA to clarify the City's authority, as proprietor, to control the use of the Airport land.

11 On March 25, 2014, staff reported on its work and the developments of the previous year. Staff sought direction on Airport leasing, planning, environmental and legal work that would enable the City to determine the future use of its land now occupied by the Airport, including possible closure of all or part of the Airport, among other things. Council gave staff various directions, including direction on leasing policy. Initially, Council authorized renewing all leases for three years because the legal disputes would take at least that long to resolve and, meanwhile, the Airport should not be a drain on the General Fund and should, instead, be supported by Airport users. However, Council later sought recommendations from the Airport Commission, which opposed three year renewals of all leases because of the adverse impacts on neighbors of aviation operations. Council did not make any decisions about the Airport's future. However, it did, among other things, direct staff to work on contingency plans for the Airport's future, continue its efforts to establish the City's right to control use of the land, and take other actions to enable the City to determine the future use of the land, including possible closure of all or part of the Airport.

Developments During The Last Year Airport Operations Airport staff monitors operations on a calendar year basis. In 2014, total Airport operations declined. However, jet and helicopter operations increased. From January through December of 2014, there were a total of 83,324 operations, a 12% decline from the previous year. The most significant change was the decline in local operations, most of which are patterned operations associated with flight training. In the category of local operations, the decline was 38%. The vast majority of total Airport operations are propeller aircraft operations. In that category, there were almost 14,000 fewer operations in 2014 than in 2013. Last year's decline in operations continues a ten-year trend, which is depicted in the chart below.

However, jet and helicopter operations increased in 2014. Jet operations increased by 7% (940 more operations). Helicopter operations increased significantly from 2561 to 3719, an increase of 45%.

There was one accident in the last year. On March 5, 2015, as this report was being written, the pilot of a single-engine, vintage aircraft apparently experienced engine failure and performed a crash landing just west of the Airport on the Penmar Golf Course about 50 yards from homes. In covering the accident, The Los Angeles Times ("LA Times") reports on the accident included praise for the pilot’s handling of the emergency but noted that Airport neighbors felt that the incident illustrated Airport risks. The LA Times reported that: 42 aircraft accidents have occurred in the vicinity since 1982; 11 of them have involved crashes in residential areas of Santa Monica and West Los Angeles; 25 pilots and passengers have died and 16 more have been hurt, but no one on the ground has been seriously injured and only one of the crashes involved a jet. LA Times March 6 & 7 2015.

Airport Leases At present, there are a total of 207 leases at the Airport and 198 subleases, for a total of 405 tenancies (not including tie-down licenses). As to buildings, there are 122 tenants who lease from the City and 84 subleases. Some of the buildings are owned by the City; some others are owned by tenants but will become the City's property, free and clear, when the leases expire later this year. As to hangars, there are a total of 199 at SMO, most of which (114) are subleased from City tenants. All but one of the hangars are owned by the lessees.

14 There are six master leases at the Airport. They are with Atlantic Aviation and Gunnell Properties, American Flyers, Krueger Aviation, The Santa Monica Air Center (Barker Hangar), and Santa Monica Art Studios. These master lessees, in turn, sublease to and manage over 200 subtenants, mostly hangar subtenants.

Most of the City's tenants (102) are on land currently designated for other than aviation- related used. There are also 74 subtenants on the non-aviation land, twelve of which are hangars at Santa Monica Air Center.

Airport Finances During Fiscal Year 2014-2015, which ends June 30, 2015, the Airport continues to operate self-sufficiently. During the years when the Airport was not self-sustaining, loans were made from the General Fund, which totaled $13.6 million as of June 30, 2014. The Airport Fund continues to make interest payments to the General Fund on the existing loan. Additionally, during this fiscal year, the Airport Fund will pay down the loan principal by making a payment of $500,000. This will be the first repayment of principal.

The 2014 Election Almost immediately after the Council gave staff direction last March, aviation interests prepared and circulated a ballot measure for the November 2014 election. It would have amended the City Charter to require voter approval in order to close all or part of the Airport, to change the use of the Airport Land, or to impose new restrictions on fuel sales or the use of aviation facilities. Thus, among other things, the measure would have taken away the City Council's authority to close the Airport and reduced its power to control aviation-oriented uses of leaseholds. The measure, (denominated “Measure D” for "development"), was touted as necessary to protect the community from over- development of the land now occupied by the Airport. Measure D qualified for the ballot, though many community members questioned the veracity of representations made by the signature gatherers, who were compensated at a flat rate per signature.

15 In response, the City Council placed a competing measure on the ballot, Measure LC (for "local control"). It proposed allowing Council to retain its authority to close the Airport but amending the City Charter to require voter approval of future uses of the Airport land other than park, recreational and educational uses. Many residents campaigned in support of the City measure, and it passed. The conflicting measure failed, despite heavy financial backing from national aviation interests. The Daily Press reported on March 10th that aviation interests expended $872,593 in support of Measure D. Opponents of the measure and supporters of LC spent $155,711.

The Status of Pending Litigation As to the Airport and Airport-related issues, this has been an extremely litigious year.

Litigation About Control Of The Land: In 2013, the City filed City of Santa Monica v. FAA in federal court to establish its right, as property owner, to control future use of the Airport land. The FAA moved to dismiss the case on procedural grounds. The motion was granted based on the court's conclusion that the City's main claim was barred by the statute of limitations and its other claims were not yet "ripe" (ready for adjudication). The City appealed, and the case is pending in the Ninth Circuit Court of Appeals. Briefing is complete. Based on experience in the Ninth Circuit, staff and outside counsel do not expect a decision until sometime in late 2016, after which the case may go back to the federal trial court or the losing party may petition the United States Supreme Court for review. The City is represented in this litigation by Morrison and Foerster, and their work is monitored by the City Attorney's Office.

Election Litigation: City residents filed two lawsuits against the City, City officials and proponents of Ballot Measure D that were apparently intended to keep that measure off the ballot. The complaint in Redden v. Kokotakis, filed last May in state court, claimed that City officials violated state election law by improperly allowing the initiative to qualify for the ballot

16 and by improperly preparing various required ballot materials. The City filed a special motion to strike, partly on the ground that the suit against City officials had no likelihood of success. Later, the initiative's proponents filed their own motion, using the same procedure. On August 19, the trial judge dismissed the lawsuit and later awarded attorney's fees against the plaintiffs and to the Measure D proponents. The plaintiffs appealed. And, in August of 2014, many of the same residents filed a second lawsuit, Hartley v. Logan, against many of the same defendants and the County, seeking to prevent the county from placing Measure D on the ballot. The trial judge refused to issue an injunction and dismissed the suit, and plaintiffs appealed. Both lawsuits recently settled after the City Council waived the City's right to attorney's fees, Council members individually asked the court not to award fees to the aviation interests, and staff did what it could to encourage the aviation interests to settle with the plaintiffs, which they did. The City Attorney's Office represented the City in these proceedings.

Part 16 Proceeding re Expiration of Grant Conditions: Last July, national aviation associations and others initiated an administrative proceeding before the FAA under Part 16 of the agency's regulations. Petitioners assert that the City's grant obligations remain in effect and will not expire until 2023 (20 years after the 2003 amendment to the 1994 grant). The City responded to the petition by moving to dismiss the proceeding, petitioners filed a response, and the FAA did not rule on the motion. So, pursuant to FAA procedural rules, the City filed its answer to the petition, and petitioners replied. On February 23rd, the FAA requested supplemental information and briefing on the useful life of Airport improvements funded by the 2003 amendment to the 1994 grant. The Director's Determination, which was due on March 13th, may be available by the time Council hears this matter. Once issued, it will be subject to further FAA administrative review. A final decision from the FAA would likely be issued in late 2015 or early 2016. The Agency's final decision is reviewable in either the Ninth Circuit or the DC Circuit, a process which would likely take two years. The City Attorney's Office is representing the City in this proceeding.

17 Landing Fee Litigation: In December, an Airport user filed Top Gun v. Vector Airport Solutions/City against the City and the City's contractor that administers the landing fee program. The complaint alleges errors or improprieties in the administration of the program, including imposing charges against aircraft that enter the SMO airspace but do not actually land. Soon after filing the complaint, plaintiff sought an injunction to halt imposition of the landing fees. It was denied. The City Attorney's Office is defending the City.

Airport Litigation Arising From Plane Crashes: The City has also been litigating cases arising from two separate crashes. These cases involve various claims, including that the Airport constitutes a dangerous condition on public property. Twelve lawsuits arose from the fatal crash of September 2013, most of them filed against the estate of the pilot and the owner of the aircraft. These cases have been deemed related with Dupont v. Estate of Mark Benjamin designated as the "lead case", and assigned to a single judge. The City is being defended and indemnified in that litigation by its insurance carrier Phoenix Aviation. Additionally, the City is seeking compensation in the litigation for property damage and expenses arising from the crash. That work is being handled by the City Attorney's Office. And, finally, Blanchard v. Justice Aviation/ City, which was filed in 2012, has very recently settled. It involved a 2011 accident in which a pilot trainee crashed a plane owned by Justice Aviation into property in Sunset Park, damaging a resident's garage/retaining wall. Justice Aviation paid most of the settlement, which also included a small contribution by the City's insurance carrier. Outside counsel paid by the City's insurance carrier represented the City in this case.

The Airport Commission's Recommendations And Work During the past year, the Airport Commission has addressed several important issues, provided a forum for community input and formulated recommendations for minimizing Airport impacts by controlling emissions and recommendations for moving into the

18 future. The Commission's most significant recommendations and a few other aspects of its work are summarized here.

As to aircraft emissions, the Commission considered a detailed presentation by one of its members which conveyed, among other things, a substantial amount of information about the harmful effects of aircraft emissions and the results of studies done on the levels of ultrafine particles and black carbon near SMO. The Commission also heard a presentation by a private attorney who urged that, as airport proprietor, the City has the authority to "enact a reasonable ordinance mandating that aircraft may no longer use [SMO] unless they have engines that are rated to meet newly-set limits related to air pollution emissions." This legal conclusion rested on the distinction between the City's police powers and its proprietary powers and upon the attorney's belief that there is a "proprietary exception to federal preemption" and the Clean Air Act therefore does not preempt the City from regulating aircraft emissions at its Airport. Based on this information, the Commission voted to recommend an ordinance intended to limit emissions by phasing out use of the Airport by the most polluting types of aircraft.

In response to the Commission's recommended ordinance, the National Business Aviation Association ("NBAA") wrote to the Mayor and Council, conveying its opposition to the recommended ordinance. The NBAA letter argues that the measure would be illegal because, among other things, it would be preempted by federal law. Specifically, NBAA noted that the Clean Air Act gives the Environmental Protection Agency, in conjunction with the FAA, exclusive jurisdiction over aircraft emission standards. The NBAA letter also urges that: the grant conditions and Instrument of Transfer prohibit the City from imposing emission restrictions that would limit aircraft operations; ANCA applies and prohibits access restrictions on Stage 2 and 3 aircraft without submitting a study to the FAA in advance; and federal law bars airports that have accepted federal funds from granting exclusive rights and allowing access to some aircraft operators while denying access to others.

19 In addition to recommending an ordinance limiting emissions, the Commission also considered emissions reductions at a workshop conducted by staff on alternative aviation fuels. One of the assistant directors of the South Coast Air Quality Management District presented information about the challenge his agency faces in reducing nitrogen oxide emissions by 2023 and how the use of alternative aviation fuels could assist in reaching that goal. Representatives of two companies described their successes at formulating a "drop in" jet biofuel that will be available later this year. It blends directly with petroleum jet fuel, thereby obviating the need to modify aircraft, engines or fueling infrastructure. And, a representative of a third manufacturer discussed his company's participation in the Piston Alternative Fuels Initiative, which currently involves testing that will facilitate FAA evaluation of an unleaded fuel for propeller aircraft. He estimated that such products will be on the market by 2018.

Last month, the Commission approved and voted to recommend to Council a two part Action Plan for the Airport. Part I of the Commission's proposed plan calls for seeking the FAA's permission to remove the quitclaimed [western] parcel from aviation use, installing runway safety areas at each end of the runway, and [eventually] closing the remainder of the Airport. This recommendation is intended to “ripen” certain claims against the federal government. Part II recommends that Council act now to: (1) recognize that the non-aviation parcel, south of Airport Avenue, was released from aviation use in 1984; (2) renew the 166 leases on the Non-Aviation Parcel for any term at market rate through Council action; and (3) adopt and implement the ordinance proposed by the Commission to limit emissions.

Additionally, Part II recommends actions to be taken after expiration of the 1984 Settlement Agreement: (1) reclaiming the Gunnell and Atlantic buildings;

20 (2) entering into direct leases with ground lease subtenants on a month-to- month basis, at market rate - not a special aviation rate; and (3) renewing leases with existing tenants on a month-to-month basis and at market rates – not lower aviation rates.

Input from the Community Individual officials and community members offered many suggestions and comments during the last year, and staff has considered them all. Many were duplicative, and representative examples of the community input are provided here.

The Chair of the Airport Commission, acting as an individual, offered various suggestions and opinions. These include, among other things, that all leases should become month-to-month after July 1st to maximize planning flexibility, all rents should be at market rate, all fuel sales should be prohibited after July 1, 2015, and that City policy should not be driven by concerns about complaints filed with the FAA because, in his view, "the only penalty is no future airport improvement funds from the FAA."

Other community members continued to steadily express safety concerns. One resident noted that: the current runway was designed and built during World War II by the federal government to accommodate military aircraft built for wartime operations -- a context in which civilian safety was not a major priority; the Airport does not have adequate space for the runway safety areas that the FAA requires at new airports; and the cost of providing runway protection zones would be approximately $750 million (because it would require buying up and destroying hundreds of homes).

The recent crash on the Penmar Golf Course intensified the debate about the Airport's safety and its safety relative to other airports in the region. Since that accident, aviation interests have argued that the Airport is both objectively safe and comparatively safe relative to other airports but could become unsafe if the City were to change the layout by, for instance, removing the western portion of the Airport from aviation use and

21 shortening the runway. Residents have continued to argue that the Airport is unsafe because of the lack of runway safety protections (safety areas or clear zones) and, most important, because of the unusual proximity of the runway ends to homes, a gas station, and other uses.

Community members expressed various views about leasing. One community member noted that the 1984 Agreement imposes certain leasing requirements, but the Instrument of Transfer and grant conditions do not explicitly state that the City must lease space to aviation tenants. So, he suggested simply adopting a leasing policy analogous to the low-density, Light Manufacturing Studio District policies and renewing any leases compliant with that policy at market rate, after July 1st. Alternatively, he suggested renewing leases only on a month-to-month basis.

Another community member presented a list of suggestions with commentary, which focuses on lease administration. It is detailed here partly because it is comprehensive, encompassing many suggestions advanced by others. The suggestions include, among other things: • Separately considering and administering the non-aviation parcel, which was released from aviation use by the 1984 Settlement Agreement;

• Ending all aviation use of that parcel;

• Hiring a private leasing agent to lease property through a competitive bid process and to administer leases on both aviation and non-aviation land;

• Raising rents to market rate;

• Eliminating subleasing;

• Offering two different terms: month-to-month and longer term for tenants that make specified concessions;

• Dedicating all net revenues from leasing to a special fund to prepare for financing future uses approved by the voters through Measure LC.

22 This list of proposals also acknowledged strategies suggested by other community members. Those proposals include: • closing all flight schools as incompatible with surrounding land uses, or at minimum requiring use of mufflers as a condition to any lease;

• prohibiting fuel sales at the Airport; • closing the western parcel; • shortening the runway; • adding buffer zones; • repurposing the land that would be freed up; • limiting emissions; and • repaying the 2003 grant adjustment.

However, the writer did not recommend any of these suggestions because each carries the risk of precipitating a Part 16 complaint.

While many community members focused their efforts on identifying specific actions that might be taken this year, others worked to advance their future goal of someday changing the use of all or part of the City's land now used for an airport to a regional park. Of course, members of the aviation community strove to preserve the Airport in its current form.

Other Developments: the FAA's Work On The Southern California Metroplex and Advances In Alternative Fuels During the last year, the FAA continued its work on the SoCal Metroplex project, which is intended to improve the efficiency of air transportation in Southern California by, among other things, optimizing aircraft arrival and departure procedures throughout the region. The FAA has stated that the project may involve changes in aircraft flight paths and altitudes in some areas but would not result in any "ground disturbance" or increase in the number of aircraft operations.

23 Staff has been monitoring the FAA's progress on this project since the FAA tested a new departure heading (the 250 degree heading), which routed departing aircraft over Ocean Park, rather than directly to the coastline. At the time, the FAA explained that an adjustment in the departure heading was required to avoid an intersection of the LAX and SMO departure paths over the ocean. Many City residents protested against the 250 degree heading, and staff argued against it on the community's behalf. The FAA said, at the time, that it would defer action and address the issue, later, as part of the SoCal Metroplex project.

Staff has met with local FAA representatives several times in the last year. Earlier this year, FAA representatives stated that Metroplex proposals relating to procedures at SMO were not yet fully developed. FAA representatives stated that they anticipate providing details at the start of the FAA's Environmental Assessment and Safety Review (EA) process, which is scheduled to begin in June. There will be a number of community meetings after the draft EA is released on June 10th. Staff requested that at least one of the meetings be held in Santa Monica so that community members will have the opportunity to hear directly from FAA representatives and to voice concerns directly to them.

Elsewhere in the state, San Carlos Airport announced that, this summer, it will begin selling an unleaded fuel for use by aircraft. Also, the nonprofit Center for Environmental Health, based in Oakland, announced a recent legal settlement with aviation fuel companies, which lowers the maximum allowable lead content of airplane gasoline (avgas) sold at the state's largest airports. And, in Washington D.C., the White House is reviewing a plan by the EPA to regulate greenhouse gas emissions from aircraft.

Discussion Community debate and litigation have intensified with the approaching expiration of the 1984 Settlement Agreement and the leases at the Airport. Suggestions about what actions the City should take and when it should act have ranged from simple to highly

24 nuanced. This section responds to the most significant suggestions and summarizes staff's recommendations.

For years, the City officials, the community, and City staff believed that the City could accomplish radical change in Airport operations and use of the land, this year, after the expiration of the 1984 Settlement Agreement. Some community members and neighbors still argue that the City should close all or part of the Airport immediately after July 1st. In support of this argument, some have noted that the former mayor of Chicago bulldozed the runway at Meigs Field and closed that airport and has characterized the FAA as a "paper tiger" with no real authority to stop the City from closing all or part of the Airport. This line of argument is appealing, but it does not withstand legal scrutiny.

If the City Council were to decide to close all or part of the Airport and attempted to do so this year, after July 1st, staff believes that the FAA would take immediate action based on its own views of the City's obligations. Likely, it would issue an administrative order prohibiting the action and seek a federal injunction enforcing that order. This is just what the FAA did in 2008 in its litigation challenging the City's ordinance banning Category C&D aircraft, even though the ordinance was adopted to promote runway safety. And, the federal courts would likely uphold such an order as they did in the prior litigation.

Thus, although the expiration of the 1984 Agreement and the leases are significant events, as a practical matter, they will not free the City to do as it pleases with the Airport. To the contrary, the City will not have full control of the land that is now used for the Airport unless and until the legal disputes about the Instrument of Transfer and the expiration of the grant assurances are resolved in court. That process is underway. It will continue to be hard fought; and it will likely take several more years. But, resolution will eventually come.

25 In the meantime, the City faces the problems of how to keep the Airport as safe as possible while attempting to reduce adverse impacts on residents and neighbors, and maintaining the Airport’s financial self-sufficiency, while minimizing legal risks and costs to the extent possible.

Possible City Actions

The practical reality that the City may not now be in the position to reduce or eliminate the Airport does not mean that the City is powerless to act to protect residents and the environment. Certain possible actions that may be taken for those purposes are discussed in this section.

Leasing While Awaiting Legal Resolution The City’s most substantial opportunity for effectuating change this year is presented by the expiration of all Airport leases that currently remain in effect. (Many of the Airport tenancies are month-to-month.) However, using this opportunity presents challenges. The leases and subleases are numerous. Uses are diverse. The buildings are of varying ages and in varying states of repair. Given these realities, staff has endeavored to formulate recommendations that may be less than ideal but which are appropriate given the City's goals and the circumstances. And, in doing so, staff has considered the proposals made by community members and the recommendations made by the Airport Commission. Staff agrees with and recommends several of them.

First, staff recommends that any submarket rents should be increased to provide appropriate Airport revenues and meet legal requirements. Because of the number of leases, assessing each and effectuating appropriate increases is a large project. It will take time, and require negotiations. There are, and will continue to be, disputes about lease valuation, market rates and proposed increases. This is inevitable, partly because the airport leasing market differs significantly from other commercial markets and particularly from the office market. However, experience at SMO, particularly

26 evidence of the profitability of subleases, indicates that the property is desirable to a range of tenants. Thus, it appears that the SMO market will bear higher rents on many of the Airport leaseholds. Moreover, the FAA generally requires that all non-aviation leases be at market rates; and the Council has committed to keeping the Airport financially self-sufficient and paying down its General Fund loan.

Second, staff recommends re-evaluating and re-negotiating the master leases in order to maximize revenue to the City and ensure accountability. Several of the master lessors are benefitting from historic low rents, which may have been appropriate once, but are no longer; and they are charging their subtenants current market rates, which are significantly higher, thus reaping substantial profits. Staff proposes two approaches to solve this problem: terminating some subleases and taking a share of the profit on the others through the incorporation of a percentage of rent provision into the master leases.

Staff believes this two-pronged approach is preferable to attempting to eliminate all subleases for several reasons. Eliminating all subleases and negotiating separate leases for each current subtenant or space occupied by a subtenant would be an enormous amount of work. The six master lessees currently manage the leases of more than 200 subtenants. If subtenancies were eliminated, wholesale, the City would be managing more than 400 Airport leases (not including over 200 tie-down license agreements). Negotiating all of them would take at least a year.

Moreover, a master lease with subleases to small businesses is the norm in airport leasing throughout the region and beyond. And, it has advantages for airport proprietors. Master tenants administer their own subleases and are responsible for maintaining the property. If subleases are prohibited, the City will have to absorb those costs and risks, which are significant. Some have suggested that the City should simply lease these properties out to office tenants. But, doing so would likely spawn a new Part 16 proceeding in which aviation interests will claim, among other things, that the

27 grant assurances remain in place and that, while they do, the City must maintain basic aviation services and not discriminate against aviation services. And, the City should insist on compliance with all applicable environmental laws and make appropriate arrangements for clean-up of hazardous materials incidents, both past and future.

Staff concurs with the Commission and community that the master leases must be renegotiated. However, staff recommends that Council afford flexibility in the means of addressing the problem of how to maximize City revenues from sub-tenancies. This may include contracting for property management services. As to some properties, that approach may ultimately prove to be the best option. Accordingly, as discussed below, staff recommends a flexible approach to handling all the complex leasing renewals and updates.

Third, staff concurs and recommends that the non-aviation land should be devoted to non-aviation uses, including, perhaps, the recreational uses that have been previously considered for that property. In the short term, the City can begin this transition by replacing the aviation businesses on the non-aviation land with new tenants and, if necessary, relocating the aviation businesses and other aviation uses (tie downs).

Fourth, staff agrees and recommends that private, professional assistance should be secured to assist the City with Airport lease negotiations. This recommendation is based, in part, on the exceptional volume of leasing work occasioned by the expiration of all of the leases in a single year. Later this month, staff intends to issue a Request for Proposals for such services within staff's authority, and intends to work with the selected consultant to negotiate or renegotiate leases. This experience will inform any future recommendations about using private leasing agents for additional services.

As to the leasing of particular aviation parcels, many current tenants and subtenants have requested new leases. Other aviation and non-aviation tenants have advised that

28 the present uncertainty has caused them to consider leaving the Airport. For now, staff is recommending that Council consider five leases in the context of this agenda item.

The Museum of Flying has requested renewal of its lease, noting that uncertainty about its future significantly hinders fundraising and impairs its ability to book future events (for which space is often reserved far in advance). Renewing the museum's lease will not only ensure the viability of the museum as a repository for Airport history, it will also serve the Council's goal of promoting the placement of educational and cultural uses on the south side of the Airport.

Atlantic Aviation (2800 Donald Douglas Loop North) and two of its current subtenants have each requested separate new leases. Granting their requests would serve the City's goal of eliminating subleases that divert revenue to "middlemen". The revenues that have been going to Atlantic Aviation as sublease rent from Volkswagen/Audi and Milstein, Adelman & Kreeger would flow directly to the City, significantly enhancing City revenues.

As to Atlantic's request for a new lease for the remainder of the leasehold, which actually is now used for its present operation, staff believes a new lease with Atlantic is practically prudent. Staff anticipates that, if the City were to deny a lease, the federal government will likely take action against the City, perhaps based on a claim of discrimination in violation of the grant assurances. Such action would likely be based on the FAA's belief that the type of aviation services provided on the leasehold must be provided so long as the Airport remains open or open to business jets, which it unavoidably likely will for the next few years. It probably will take that long to resolve the litigation about the Instrument of Transfer and grant conditions, and meanwhile the FAA would doubtless take the position that denying services for jet aircraft would violate the grant conditions. Moreover, Atlantic is located on the north side of the Airport, which has long been identified as the preferable location for aviation businesses. And, when the Atlantic lease expires, the City will own the building, and ownership will bring

29 significant new maintenance costs and responsibilities. Additionally, Atlantic has indicated its willingness to work with the City on environmental issues such as alternative fuel sales; and specific environmental obligations could be incorporated into any new lease.

Krueger Aviation (2701 Airport Avenue), another of the master lessors, has also requested a new lease. Krueger subleases to three, small non-aviation businesses (a law office, an architect and an interior designer), subleases to an aircraft maintenance facility, and also subleases tie-downs. Airport staff is recommending negotiation of a new lease because the maintenance services provided on this leasehold promote safety and because the operation does not create particularly adverse impacts. And, any issues of revenue diversion can be addressed in negotiations.

As to each of these leases, staff is proposing three year terms with one year extensions at the City’s sole option. This proposal reflects the reality that it will almost certainly take that long to resolve the legal issues, and the revenue from Airport leases must be maintained in the meanwhile to maintain the Airport's financial self-sufficiency. In addition, staff anticipates undertaking negotiations with the other master lessees to, among other things, address issues relating to subleases and adverse impacts on neighbors.

Staff anticipates that, while it focuses on the master leases in order to maximize revenues and ensure accountability, other leases will continue on a month-to-month basis with lease rates increased as appropriate. Further, to adequately maintain the Airport Fund balance, staff requests authorization to re-negotiate individual leases on a case by case basis and then bring them to Council for approval.

Curtailing Emissions Some of the disagreement over the last year about what the City can and should do with regard to emissions relates to a difference of opinion about the extent of the City's

30 legal authority as Airport proprietor. A local attorney made a presentation to the Commission about the City's proprietary rights. Legal staff agrees with him that Congress and the courts have recognized that airport proprietors have rights not shared by non-proprietors. However, neither the Congress nor the courts have defined the scope of proprietors’ rights. And, the FAA vigorously enforces its belief that proprietors' rights were always limited to noise regulation and that Congress has now preempted new local regulation in that field by adopting ANCA, which establishes a federal procedure and requirements for changing local noise restrictions. The City certainly does not concur with the FAA's narrow interpretation of airport proprietors' rights. However, it is important to recognize that this is a complex area, very likely to engender litigation.

Nonetheless, the presentation to the Airport Commission included the argument that proprietor's rights are substantial enough to obviate federal preemption in the area of emissions controls. The presenter cited Engine Manufacturers Ass'n v. South Coast Air Quality Management Dist., 498 F.3d 1031 (9th Cir. 2007). In that case, trade associations and diesel fuel producers challenged fleet rules adopted by the California's Air Quality Management District, which required both public and some private fleet owners to choose vehicles meeting specified emissions standards or containing specified alternative-fuel engines when they expanded their fleets. Plaintiffs claimed that the state's fleet rules were preempted by federal law. The federal trial court ruled in favor of the District, holding that the rules were not preempted by the Clean Air Act. The federal appellate court affirmed, and the Supreme Court remanded the case back to the Ninth Circuit. It held that the fleet rules governing procurement by state and local governments were not preempted because the government entities were acting as market participants in purchasing vehicles, not as regulators.

This case does not stand for the proposition that a local governmental entity that owns an airport can impose emissions restrictions on private purchasers and owners of aircraft in contravention of the express language of the Clean Air Act which specifically

31 prohibits such action. Rather, the case might mean that if City funds were to be expended to purchase aircraft, the City could require that certain performance standards be met, such as that the aircraft be able to operate on alternative fuels. However, as to privately purchased and owned aircraft, the case does not stand for the proposition that the City can ignore the Clean Air Act and regulate aircraft emissions.

Contingency Planning for the Future & And a Possible Ballot Measure As litigation regarding the Instrument of Transfer and grant assurances proceeds, staff recommends that the City continue to devote resources to contingency planning for the future of the Airport and the City's land now used for the Airport. Substantial environmental work, CEQA review and planning actions would be necessary to significantly alter the use of the land. This would include a thorough investigation of the environmental conditions at the Airport to estimate the scope of the full investigational work that would be required in the future. Among other things, this preliminary work should include an initial cost estimate of what would be necessary to investigate potential contamination issues. Preliminary consideration of CEQA requirements for changes in use would help to prepare the City for a decision on the process and alternatives to be considered. Possible changes in the City's General Plan and zoning laws should also be considered.

Staff also recommends devoting City resources to consideration of a potential ballot measure for 2016 regarding possible future uses of the Airport land. The success of the City’s ballot measure in 2014 (and the defeat of the aviation interests’ measure) means that potential future use of all or part of the Airport land for recreational and cultural purposes would not require voter approval. However, it is possible that the City’s interests would be best served by allowing some other future uses at some locations on the land. For instance, it might be beneficial to the community to situate certain City government improvements at the Airport, such as an environmental center. Also, certain community serving uses, such as restaurants, and certain commercial uses,

32 such as office uses on the north side, could continue to generate revenue to fund community amenities.

Alternatives Leases At least theoretically, a wide range of alternatives exist for Council's direction to staff on leasing strategies. For instance, at the extremes, Council could instruct staff to simply maintain all current tenancies on a month-to-month basis during this time of legal uncertainty in order to maintain maximum flexibility. Or, Council could instruct staff to end the tenancies of all current tenants after July 1st and simply rent the leaseholds to the highest bidders. However, the former alternative may jeopardize revenues because uncertainty may induce some tenants to leave and may reduce rents paid by future tenants. Moreover, more litigation will likely ensue if aviation services provided by current tenants are not replaced. So, staff recommends against these extremes.

Council could also direct staff to return with leasing guidelines, so that individual leases conforming to the guidelines would not require Council approval. However, any guidelines that appear to disfavor aviation uses will likely be challenged; and Council approval of leases maximizes transparency.

Another alternative would be to maintain all tenancies, except the master lessees', as month-to-month. This is one of the Airport Commission's recommendations. However, staff recommends against this approach in order to keep the Airport financially sound, so long as the City must operate it. Leases have the potential to generate significantly more rent than month-to-month tenancies because tenants value stability. Also, offering leases gives staff the leverage to negotiate conditions that curtail adverse Airport impacts. Thus, staff recommends against prohibiting all new leases. Moreover, authorizing staff to negotiate individual leases, as appropriate and for Council review, will not impair future flexibility because staff proposes that all leases should end by July

33 1, 2018, at the latest, with any annual extensions beyond that date to be at the City's sole discretion.

The Commission has also recommended eliminating all uses of Airport land that are incompatible with surrounding residential uses and eliminating fuel sales that are not required by contracts. For example, the Commission has recommended eliminating all fuel sales except those which the City is contractually obligated to allow. However, establishing a City policy of eliminating uses that the federal government likely views as essential to Airport operations may trigger yet more litigation. Thus, staff recommends addressing adverse impacts and promoting compatibility mainly through negotiated lease provisions.

Restrictions on Land Uses Also, in 2013, the Commission recommended eliminating aviation use of the western parcel of the Airport. Again, adopting this as City policy would likely provoke more litigation. However, it may be possible to work towards this goal through negotiations with tenants.

Funding Future Uses The suggestion that net revenues from leasing be set aside to fund future, non-aviation, use of the land, such as a park, is an alternative that should be noted because it will likely appeal to many. However, given the federal government's demands about the use of leasing proceeds, staff does not recommend this possibility at this time.

Emission Controls As to reducing aircraft emissions, Council could direct staff to return with an emission control ordinance, such as the one recommended by the Commission. But, as explained above, such an ordinance will likely be challenged immediately as preempted by federal law; and a favorable outcome is doubtful. Addressing emissions through

34 negotiated lease terms or practices that require or encourage the provision of alternative fuels and increase efficiencies in operations is therefore a better alternative.

Future of the Airport As to directions relating to the Airport’s future, the range of alternatives is broad. For instance, the Council could make a decision, now, to close all or part of the Airport as soon as that becomes possible. However, that action would only be symbolic because, as explained above, during the pendency of the litigation about the grant assurances, any radical change undertaken by the City will likely be enjoined.

Many have hoped that offering to repay grant money to the FAA would resolve the dispute over grant assurances or at least better position the City in litigation. However, as a practical and legal matter, the City cannot shorten the duration of that litigation by simply offering to or actually paying back the grant money received in 2003.

Likewise, as recommended by the Airport Commission, the City could ask the FAA's permission to close all or part of the Airport. Based on the FAA's positions to date, such a request would certainly be denied. The Commission recommended the request in order to "ripen" certain issues for litigation. However, there is no immediate need for that action. The current Ninth Circuit appeal in the City's case and the aviation interests' Part 16 case remain pending, and these cases are likely to provide answers to some key legal questions. Second, should circumstances change, such a Council decision could be made at any time in the future. Finally, there is much contingency environmental, CEQA and planning work that needs to be done before such a decision would be meaningful in terms of actually changing use of the land.

Next Steps Depending upon Council’s direction, staff foresees bringing the remainder of the master leases, and perhaps other individual leases, to Council within the next six months. Also,

35 staff will return to Council with a written report on progress with leasing, contingency planning for the future, and further recommendations regarding a possible ballot measure before the end of the year.

Financial Impacts & Budget Actions No budget actions are necessary at this time to effectuate the recommendations made in this report.

If staff’s leasing recommendations are approved, lease revenues will increase. For instance, City leases with two of Atlantic’s current subtenants would significantly increase City revenues from that parcel.

In general, if Council opts for a course or courses of action that spark additional litigation, litigation costs will increase, particularly if it is necessary to hire outside counsel.

Prepared by: Marsha Jones Moutrie, City Attorney

Approved: Forwarded to Council:

Marsha Jones Moutrie Elaine M. Polachek City Attorney Interim City Manager

36 City Council Report

City Council Meeting: March 24, 2015 Agenda Item: 9-A To: Mayor and City Council From: Edward F. King, Director of Transit Services Subject: Big Blue Bus/Expo Service Integration Plan Public Hearing and Adoption of Service Plan

Recommended Action

Staff recommends that the City Council hold a public hearing, receive public comment, and approve the revised Big Blue Bus operating plan for new and restructured BBB routes and schedules that will provide seamless integration with Expo Light Rail at the stations in the BBB service area.

Executive Summary The Expo Integration Plan seeks to capitalize on the opening of seven new rail stations in the Big Blue Bus service area. This is a significant change for a system that has served rail only at the periphery until now. Alterations of bus routes to attract new rail-to- bus transfers have the potential to increase ridership, make more efficient use of transit resources, and reduce overall levels of congestion. The Expo Integration Plan process included extensive public outreach, a survey of existing conditions, a City Council Study Session, and a resulting recommended plan of action.

The primary objectives of the plan are:

• Creating first-and-last mile connectivity • Creating more north-south corridor service to serve the stations • Reducing redundancy with other transit providers • Eliminating inefficient routing; improving speed and reliability; and maximizing resources • Acknowledging that current BBB service must continue to serve local passengers, markets, and customers that do not interface with Expo

A study session was held at the December 16, 2014 Council Meeting to review the Expo Integration Plan and obtain Council direction prior to final adoption. The plan recommended at the time provided the above enhancements to the BBB system and called for a 9% increase in annual revenue service hours to a projected 553,000 from the current 507,000, anticipating a July 1, 2016 fare increase to offset that 9% increase.

1 Based on feedback from the Council, staff adjusted the plan by revising three of the routes presented to Council in the December 2014 presentation. In addition, one other route was adjusted based on stakeholder comments received after the December 16th presentation.

The proposal, described in detail herein and in the attachment, includes an increase of approximately 11% in revenue service hours (507,000 to 563,000) and their associated costs. Implementation would rely on a January 1, 2016 fare increase to offset the associated increase in service.

Staff will return to Council during the FY2015-2017 Biennial Budget process with specific capital and staffing needs to support the projected increases.

Background The area served by Big Blue Bus (BBB) is changing in ways that promise to have significant impact on transportation and BBB services. The opening of Expo Phase II in early 2016 is perhaps the most impactful in the short term as it involves the opening of seven new rail stations at one time in the BBB service area.

BBB currently serves nine rail and bus rapid transit (BRT) lines at five different stations. The nine rail lines are Expo, Purple, Green, Blue, Red, Silver, Gold, Amtrak and Metrolink. The five stations are Culver City Station, Wilshire/Western Station, LAX/Aviation Station, 7th St/Metro Center Station, and downtown Los Angeles’ Union Station.

Further expansion of the Exposition Light Rail Line in 2016 will increase the number of stations served from five to twelve, and bring rail from the fringes of the BBB service area into its center. Out of these seven new rail stations, three are within the City of Santa Monica city limits, including the western terminus for the line at 4th Street. Projected weekday ridership for the Exposition Line is 64,000 boardings per weekday by 2030, and over 5,000 projected daily boardings at the 4th Street Terminus alone.

This is a significant change of conditions for a bus system that has evolved from serving rail only at Union Station in 1980 (BBB Route 10), to adding the Blue Line in 1990 (also Route 10 at 7th St/Metro Center Station), the Red Line in 1993 at Union Station, the

2 Green Line in 1995 at LAX/Aviation Station (BBB Routes 3 and Rapid 3), the Gold Line in 2003 and the Silver Line in 2009, both at Union Station, The Red and Purple Lines at Wilshire and Western Station in 2011 (BBB Rapid 7), and the Expo Line at Culver City Station in 2012 (BBB Routes 5,12 and Rapid12). Service has been continuously updated to reflect the growing prominence of rail at the periphery of the service area, and finally, now, at the center of the service area.

Changes in demographics, zoning, and land use also provide opportunities to increase ridership and make more efficient use of resources in Santa Monica, Venice and Marina del Rey (Silicon Beach), and other areas of the Westside. The City has made a commitment to aggressively reduce single occupant vehicle trips and diversify transportation options with the goal of no net new PM peak-hour vehicle trips by 2030. Two of the three new rail stations within the City of Santa Monica do not have designated parking or park and ride amenities, and the third has very limited parking dedicated exclusively to light rail users. Additionally, of the seven new stations in Phase II, only one (Bundy Station) will provide 200 spaces. The Culver City Station will be reduced to 200 spaces from 600 currently available. Municipalities are dedicating more resources to walking, biking, ridesharing, and transit to optimize the efficiency of the transportation system, and this change is remaking the fabric of the service area by introducing new transit propensities and altering the transit landscape. Big Blue Bus has existing service near or adjacent to all seven new stations, and plans to significantly adjust service to create more bus/rail integration corridors and enhance first-and-last mile connectivity.

Recognizing the unprecedented landscape change in mobility options, on September 24, 2013, the Council awarded a professional services contract to Nelson\Nygaard Consulting Associates to assist BBB in the planning process for integrating Big Blue Bus services with the seven new Expo Stations. The purpose of this study was to assist BBB in developing appropriate responses to these changing conditions. The study provided a review of the existing conditions, created a series of projections and demand

3 estimates expected as a result of the impending changes, and formulated a plan to meet demand with an adjusted and appropriate service model.

The primary objectives of the plan were: • Creating first-and-last mile connectivity • Creating more north-south corridor service to serve the stations • Maximizing the utility gained from available resources • Retaining current BBB service that serves markets and customers that do not interface with Expo

The preliminary BBB Expo service integration proposal was presented to stakeholders and the public at large over a five-month period between June and October 2014, during which time BBB staff invited and received extensive feedback on the route restructure proposal. Informed by over 4,600 survey responses and over 12,300 individual written and verbal comments through email, survey, public meeting, letters and workshops regarding the initial iteration of proposed changes to BBB service, the preliminary plan was significantly revised. This revised plan was presented to Council on December 16, 2014, where Councilmembers offered questions and feedback regarding the plan. The results of that study session informed additional changes to the plan, resulting in the recommended option presented in this report.

Discussion The arrival of the Expo rail line in Santa Monica is an opportunity to increase transit ridership, make a substantive contribution to reduction of greenhouse gas emissions and traffic congestion, and to contribute to overall quality of life for Santa Monica residents, workers and guests. In order to achieve these results, light rail passengers must be able to get to and from multiple destinations that are not within walking distance of the stations. BBB integration of the bus route system with the new rail stations is part of a larger initiative of increasing access to active transportation and alternative modes of travel underway in Santa Monica. This larger initiative is referred to in the City’s Land Use and Circulation Element as improving alternative transportation choices (LUCE, Ch. 4.0-58, p. 482).

In order to better understand the projected demand, BBB staff undertook an extensive study which included the analysis of land use, key origins and destinations, current transit ridership patterns, existing transit service and routes, corridor analysis, industry best practices and transit demand market analysis. A transit demand market analysis is the assessment of conditions that affect demand for transit services, and the types of services that might best match that demand. The overall study goals included maximizing ridership through efficient allocation of resources, minimizing impacts to traffic, stimulating Expo ridership, creating a budget sensitive service plan, and creating new direct links between stations and adjacent areas.

The additional input from stakeholder and public outreach helped guide staff toward a comprehensive plan to integrate BBB service with Expo that will encourage the use of Expo and also retain the usefulness of the current BBB system. Throughout the planning process, BBB staff involved key stakeholders, residents, neighborhood associations, business improvement districts, the Santa Monica Convention and Visitors Bureau, Downtown Santa Monica, Inc., and local businesses in a series of workshops designed to elicit public input about the process. BBB also worked closely with the Los Angeles County Metropolitan Transportation Authority (Metro) and Culver CityBus to eliminate duplication of services where possible.

Framework of the BBB/Expo Service Integration Planning Process Key components of the BBB/Expo Service Integration Study included public involvement, analysis of the current system, update of demographic information based on the 2010 census data, first-and-last mile connectivity analysis (connecting people between station locations and destinations that are beyond walking distance), reduction/elimination of redundancy between BBB, Metro, and Culver CityBus, and seamless intermodal connectivity. In addition, the study will undertake a Title VI 1 Civil

1 The Federal Transportation Authority requires compliance under Title VI of the Civil Rights Act of 1964 which addresses discrimination in most areas of public life in the United States including transportation.

5 Rights evaluation of the proposed changes, and a follow-up study to be conducted one year after BBB service implementation to determine successes and continued challenges.

Staff conducted an extensive public outreach effort to seek input from stakeholders, the details of which were described in the December 16, 2014 staff report and which are summarized in the table below.

Milestones Start Finish

First Expo Online Survey Jun 2013 Sep 2013

Data Collection, Establish Baseline of Existing Conditions Oct 2013 Dec 2013

Create an Anticipated Demand Model Jan 2014 May 2014

First Round of Community Meetings Feb 2014 Apr 2014

Second Expo Online Survey Feb 2014 Jun 2014

Create Dedicated Web Page for Project May 2014 Jul 2014

Route Design & Implementation Plan of BBB Services Mar 2014 Nov 2014

Publish Draft Expo Integration Proposal Jun 2014 Jun 2014

Second Round of Community Meetings Jul 2014 Aug 2014

Third Expo Online Survey Jul 2014 Oct 2014

City Council Study Session on Plan Dec 2014 Dec 2014

Final Service Recommendations and Adoption of Plan by City Council March 2015 March 2015

Public Hearings March 2015 March 2015

Promote Council Decisions May 2015 June 2016

Implement Service Changes Aug 2015 Aug-Sep 2016

Follow Up Study June 2017 Dec 2017

6 December 16, 2014 Proposal Informed by the 12,300 individual written and verbal comments received through email, survey, public meeting, letters and workshops regarding the initial iteration of proposed changes to BBB service, the second iteration of the plan, which incorporates the following nine elements, was presented to Council on December 16, 2014.

1. New Ridership Opportunities and Efficiencies The Expo Service Integration Plan creates most of its new transit opportunities by reducing or eliminating poorly performing services and replacing them with services that are expected to carry more passengers. In some cases, key destinations are serviced by a different route that is designed to be more efficient. While eliminating some routes or trips to create new ones can inconvenience some passengers, there are significant increases in projected systemwide ridership and efficiency as a result. Understanding that while elimination of low-ridership routes and trips creates systemwide efficiency, there may be pockets of rider demand that warrant introduction of a new type of service known as demand response service.

Where demand for transit is light, demand response service may be able to provide a higher level of convenience at a lower cost per passenger than fixed route service. A demand response system is defined by the Federal Transit Administration as any non- fixed route system of transporting individuals that requires advanced scheduling by the customer, including services provided by public entities, nonprofits, and private providers. A demand response service in place would allow passengers to call BBB for the desired service at the desired time during hours of availability, such as weekend nights, where it is conceivable that increased demand may exist. BBB, in response to the trips generated by such calls, would dispatch a vehicle to pick up the passengers and transport them to their desired destinations. BBB is exploring opportunities to introduce demand response service in areas where overall ridership is low, but may have pockets of increased demand during certain time periods such as weekend nights.

7 2. An Engaged and Responsive Public Process Significant analysis was conducted regarding Big Blue Bus’ current ridership base. The initial plan contained elimination of several routes and parts of routes. Big Blue Bus received extensive feedback on some of those proposals from existing riders, specifically in regards to Routes 2, 3, Rapid 3, 8, and 12, and Rapid 12. Additionally, the Council provided feedback on Routes 18, 43 and 44. The revised plan responds to the feedback, in many cases restoring what riders currently have or improving upon what was proposed.

Meetings with UCLA student groups were particularly productive in finding solutions. Currently, Routes 1, 2, 3M, 8, 12, and Rapid 12 serve UCLA. The plan, as revised, seeks not only to attract new riders but endeavors to retain as much of the existing ridership base as possible through the implementation of these plan revisions. It also seeks, through enhancements to Routes 18, 43 and 44, to create new connectivity for Santa Monica residents and local neighborhoods, through additions to the number of days of service, span of service and frequency. Several route proposals for new and existing services were strengthened through the public participation process.

3. New North-South Connectivity to Stations The revised plan creates access to the new Expo Stations from areas to the north and south on six new routes, or new corridors on existing routes as follows: • 4th Street south from Downtown Station to Rose Ave commercial area and Abbott Kinney Blvd via Seventh Ave in Venice • 23rd Street south from Bergamot Station to Walgrove, Costco on Venice Blvd, and Marina del Rey • 26th Street north from Bergamot Station to San Vicente • Stewart to Colorado to Centinela north from Bergamot Station to Wilshire • Barrington Ave north from Bundy Station to Sunset Blvd • Bi-directional service on 14th and 20th between Pico Blvd and Montana Ave serving Memorial Park Station both ways 8 • Continuation of the Main Street corridor southward to Marina del Rey • Extension of Centinela Ave corridor to Playa del Rey from Bundy Station • Sawtelle Blvd connecting UCLA, the Veterans Hospital, and Palms Blvd, also serving Sepulveda Station

4. Increased Access for Key Destinations beyond Walk Distance from Closest Stations: • North end of downtown Santa Monica • Venice east (Abbott Kinney) • Venice west (Main Street and Canal area) • Marina del Rey • Playa Vista • Sony Studios • UCLA • Santa Monica College • Saint John’s Hospital • UCLA Medical Center • Brentwood Village • Several high schools and middle schools

5. Reduction of Duplication and Better Coordination with Other Transit Providers Big Blue Bus held 21 meetings with multiple transit providers to discuss duplication and coordination of service resulting in informal agreements to reduce LA Metro trips to downtown Santa Monica by 15% and eliminating over 42,000 miles of LA Metro bus operation from downtown Santa Monica effective January 2016. Meetings with Culver CityBus were fruitful in successfully analyzing ways to work together to preserve connectivity for UCLA students and create a staged service integration framework.

9 6. Coordination with Santa Monica and Los Angeles Transportation Staff to Ensure Smooth Connections at Stations Big Blue Bus staff coordinated with local staff in both Santa Monica and Los Angeles to ensure that station connections would be seamless and to advocate for a more aggressive approach to providing for “kiss and ride” opportunities, corporate vans and other intermodal needs. This included participation in the Memorial Park neighborhood plan process, the Downtown Specific Plan, and the 4th and Colorado terminus site project design. This work continues in key non-station locations such as Marina del Rey and the Culver City Transit Center. Big Blue Bus met with Culver CityBus to discuss an eventual integration of the two services at Culver City Transit Center and is working on a workshop with LA Metro regarding Marina del Rey overall service.

7. Reorganization of Downtown Santa Monica Routing All downtown Santa Monica bus routes were examined for efficiency and the possibility of lessening the number of buses going west of 4th Street in order to reduce congestion in the heart of the city. The majority of bus-to-bus transfer activity in downtown Santa Monica today takes place between four bus stops – Santa Monica Blvd and Broadway stops at the Promenade, and on both sides of 4th Street at Santa Monica Blvd. The revised plan shifts the preponderance of this transfer activity to areas closer to the Downtown Expo Station and reduces bus traffic west of 4th Street by approximately half. Route 18 in one direction is shifted to 6th Street to help lessen bus congestion on 4th Street.

8. Better Speed and Reliability The revised plan includes careful elimination of poorly performing or too closely spaced bus stops and systemwide on-time performance review to better meet riders’ expectations concerning on-time performance. Combined with the upcoming availability of real-time information, these changes are expected to significantly improve the customer experience.

10 9. Civil Rights Impacts In accordance with the requirements as detailed in the Federal Transit Administration (FTA) Circular C4702.1B, titled TITLE VI REQUIREMENTS AND GUIDELINES FOR FEDERAL TRANSIT ADMINISTRATION RECIPIENTS, chapter IV-10, part 7, Requirement to evaluate service and fare changes, Nelson\Nygaard was engaged to execute a Title VI analysis on the service plan to judge whether or not there are negative disparate impacts on minority populations on the basis of color, race, or national origin and/or disproportionate burdens on low income populations. There were no disparate impacts found on minority populations in the service area and no disproportionate burdens found on low income populations in the service area based on the recommended plan.

In the interim since the plan was presented to Council in December, BBB has conducted further engagement of key stakeholders to discuss remaining questions and issues, including UCLA student groups, Santa Monica College, Culver CityBus, LA Metro and various neighborhood groups and council, and these issues and questions, along with the issues and questions raised by Councilmembers on December 16th, 2014, have resulted in further modifications. The revised plan is outlined below and fully detailed in the attachment.

Proposal The revised Big Blue Bus Expo Service Integration Plan as proposed herein is substantially similar to what was presented to Council in December 2014 and summarized above. The revisions can be summarized as follows: 1. In response to Councilmembers’ feedback, four of the 20 routes have been substantially adjusted from those presented in December; the remaining 16 routes are essentially unchanged from the December 16th presentation a. Route 16 was extended to create a connection to Routes 3 and Rapid 3 on Lincoln Boulevard.

11 b. Route 18 has been revised to add night service until 9:30pm, seven nights per week, as well as weekend day service. Both this new night service and the weekend service are recommended at a frequency of every 30 minutes. This route also was rerouted slightly due to LADOT feedback regarding streets in Venice. c. Route 43 was originally recommended as having a span of service from 6am to 9am and 3pm to 6pm, but now includes service from 6am to 9am and 2pm to 7pm. d. Route 44 had been shown to have a frequency of every 20 minutes at the December Study Session. As a result of feedback offered by Santa Monica College, the recommended frequency is now every 15 minutes all day from September through June, and every 30 minutes all day for the months of July and August. 2. These adjustments have resulted in an additional 2% increase in revenue service hours, or an 11% total increase 3. To offset the additional service hours, the fare increase anticipated for July 2016 would need to be moved up to January 2016 4. To accommodate the increased service levels, the changes would occur over three service changes rather than two.

12 Increase in Fare Increase Plan Description Implementation Revenue Service Hours Date

December 2014 20 Routes 2 phases 9% July 2016 Proposal

Revisions Updated January to 4 of 20 3 phases 11% Proposal 2016 routes

Phasing of New Service The plan includes an increase of approximately 11% in revenue service hours and associated costs. Annual revenue service hours are expected to increase from the current 507,000 to 563,000. Due to the increased hours (11%), the phasing of new service would be implemented over an extended period. In the December 16th proposal service was implemented over 2 service changes. As proposed, the new hours would require implementation over 3 service changes. Therefore, minor service changes would be implemented in September 2015, the second phase would occur in the spring of 2016 concurrent with the opening of rail service, and the third and final phase would take place in late summer (August) of 2016.

Funding of Additional Service The total projected cost associated with the Expo Integration Plan is $4.2 million. This includes $1.8 million of staffing enhancements and $2.4 million in supplies and expenses which will be absorbed in BBB’s MOE budget over the next two years. The $4.2 million does not include capital expenditures for new buses, and new bus stops. Funding would require a combination of budget strategies in tandem with a Council approved fare increase effective January 1, 2016.

13 The department continues to identify solutions for funding ongoing costs associated with the service improvements, including internal efficiencies where appropriate, a proposed cash fare increase of $.25 (senior and disabled fares would remain unchanged) and using reserves from Measure R and MOSIP 2 until passenger revenue aligns with ridership projections over time. BBB projects a 4% increase in passenger revenue with the integration of bus service with Expo. BBB’s new proposed cash fare, $1.25, is still one of the lowest in the County as most Municipal Operators are at $1.35 - $1.50, and much lower than Metro’s cash fare of $1.75. Senior and Disabled fares would be unchanged at $.50 and BBB passes would be increased incrementally. Details of the staffing and capital requirements as well as the fare increase will be addressed in the department’s biennial budget request.

Next Steps Subject to Council approval of the recommended plan, BBB will begin designing and building new bus stops in coordination with City officials in Santa Monica and Los Angeles, as well as County officials in Marina del Rey. BBB plans to advocate for minimal infrastructure investment in bus stops beyond the required ADA improvements for the first year of new service. Pending a post-implementation analysis of the service

2 Municipal Operator Bus Service Improvement Program

14 plan that will judge all new route performance, BBB will then consider what, if any, additional street furniture or other improvements are warranted.

Staff continues to evaluate the phasing of Expo Light Rail Service to optimize transition for customers, staff and operations. As noted above, staff is currently considering transitional service changes for late summer of 2015, spring of 2016 (commensurate with the operation of the Expo Line) and the final phase in late summer of 2016.

These may change due to the actual date for the opening of the light rail line, Council adoption of the proposed BBB FY15-17 Biennial Budget, and final work that needs to be completed for infrastructure improvements in Los Angeles.

Financial Impacts & Budget Actions There is no immediate financial impact or budget action necessary as a result of the recommended action. Staff anticipates approximately $4.2 million in ongoing costs associated with the proposed service level increases and staff will return to Council during the FY2015-2017 Biennial Budget process with specific capital and staffing needs.

Prepared by: Timothy McCormick, Transit Planning Administrator

Approved: Forwarded to Council:

Edward F. King Elaine Polachek Director of Transit Services Interim City Manager

Attachment: Big Blue Bus Expo Integration Study

Big Blue Bus

Expo Integration Study

Proposed Route Changes

March 2015 Council Meeting

Expo Integration Study

Proposed Big Blue Bus Route Changes - March 2015

Contents Introduction ...... 4 Study Timeline...... 5 Draft Plan Presented July 2014 ...... 6 Public Input ...... 6 Recommended Service Plan...... 7 Santa Monica City Council Feedback ...... 8 Plan Revisions Subsequent to the December 16th 2014 Study Session ...... 17 System Changes from Present ...... 18 Frequency Levels ...... 20 New Routes ...... 21 Enhanced Rapid Corridors ...... 22 Changes to Frequency, Span or Route ...... 22 Eliminated Routes ...... 22 Downtown Santa Monica Core Service ...... 23 Station Integration ...... 23 Enhancements to Santa Monica College & UCLA...... 23 LA Metro Changes in Santa Monica ...... 24 Route by Route...... 25 Route 1 – Santa Monica Boulevard ...... 25 Route 2 – Wilshire Boulevard...... 26 Route 3/Rapid 3 – Lincoln Boulevard ...... 27 Route 4 – San Vicente Boulevard & Carlyle Avenue ...... 28 Route 5 – Olympic Boulevard – Revised ...... 29 Route 6 – SMC Commuter ...... 29 Route 7/Rapid 7 – Pico Boulevard ...... 31 Route 8 – Ocean Park Boulevard – Revised ...... 32

Route 9 – Pacific Palisades ...... 33 Rapid 10 – Freeway Express ...... 34 Route 12/Rapid 12 – UCLA/Westwood Boulevard ...... 35 Route 13 – Cheviot Hills ...... 36 Route 14 – Bundy Drive & Centinela Avenue...... 37 Route 15 – Barrington Avenue ...... 38 Route 16 – Bergamot Station/Marina Del Rey ...... 39 Route 17 – Sawtelle Boulevard ...... 40 Route 18 - Abbott Kinney / Montana / UCLA ...... 41 Rapid 20 – Expo Culver City (Delete Route 20) ...... 42 Route 41-42 – Memorial Park Station Loop ...... 43 Route 43 – 26th Street/San Vicente ...... 44 Downtown Santa Monica Routing ...... 47 Late Night Expo Demand Response Service...... 48 Introduction ...... 48 Service Description ...... 48 Fares ...... 50 Estimated Cost of Service ...... 50 Estimated Ridership ...... 50 Next Steps ...... 52

Introduction The arrival of the seven new stations on the Expo Light Rail Line in the Big Blue Bus service area is an opportunity for Big Blue Bus to attract a large number of new riders. With many key destinations in the Big Blue Bus service area beyond walking distance from the new stations, and station parking at a premium, first-and-last mile connections will be crucial to maximizing the benefit of the rail line on traffic congestion and quality of life.

The proposed plan seeks to leverage the strengths of the current Big Blue Bus route system, change or eliminate the weaker services in the system, and create new or redesigned corridors that will serve both our existing riders and attract new riders. The plan as shown here features an 11% increase in vehicle revenue hours of service and is projected to attract a 14.6% increase in riders. The following pages describe the intentions, steps taken, and outcomes of the planning process.

BBB / Expo Integration Proposal March 2015 Page 4

Study Timeline

Milestones Start Finish

First Expo Online Survey Jun 2013 Sep 2013

Data Collection, Establish Baseline of Existing Conditions Oct 2013 Dec 2013

Create an Anticipated Demand Model Jan 2014 May 2014

First Round of Community Meetings Feb 2014 Apr 2014

Second Expo Online Survey Feb 2014 Jun 2014

Create Dedicated Web Page for Project May 2014 Jul 2014

Route Design & Implementation Plan of BBB Services Mar 2014 Nov 2014

Publish Draft Expo Integration Proposal Jun 2014 Jun 2014

Second Round of Community Meetings Jul 2014 Aug 2014

Third Expo Online Survey Jul 2014 Oct 2014

City Council Study Session on Plan Dec 2014 Dec 2014

Final Service Recommendations and Adoption of Plan by City Council March 2015 March 2015

Public Hearings March 2015 March 2015

Promote Council Decisions May 2015 June 2016

Implement Service Changes Aug 2015 Aug-Sep 2016

Follow Up Study June 2017 Dec 2017

BBB / Expo Integration Proposal March 2015 Page 5

Draft Plan Presented July 2014 The draft plan, initially presented in July 2014, featured the following:

• A 9% increase in revenue service hours • A dense grid of north-south services • Removal of service duplication • Stop consolidation to improve speed and reliability for rapid services • Increased service on major ridership corridors • Inclusion of last mile service to all regional destinations • Recommended changes to all routes • Service change recommendation in two phases o Summer-Fall 2015 o Winter-Spring/Summer 2016

Public Input An intensive public engagement program utilizing multiple channels was conducted over the course of more than a year, which included the following outreach:

• An online survey to gauge public desires • The first round of stakeholder and public meetings – Spring 2013 • Second online survey offering trade-off choices • The second round of stakeholder and public meetings – Summer 2014 • 21 coordination meetings conducted with other transit service providers • Third online survey regarding the draft plan • City Council Study Session • Final Stakeholder meetings

This extensive public engagement resulted in 4,600 survey responses and a total of 12,300 written and verbal comments on the plan. Analysis of the public input responses can be summed up as overall supportive of changing BBB service to connect to Expo.

BBB / Expo Integration Proposal March 2015 Page 6

Recommended Service Plan Following is a map of the recommended service plan. Most of the route plan shown here is identical to what was shown during the December 16, 2014 City Council Study Session. Subsequent to the Council Study Session, Routes 5, 14, 16, 18, and 43 were adjusted at the ends of the line to accommodate newly identified turnarounds. Route 18 also received a mid-route adjustment, which now shows the route travelling 7th Avenue between Rose and California Avenues through Venice rather than 6th Avenue. This change was made as a result of feedback received from LADOT regarding use of 6th Avenue.

BBB / Expo Integration Proposal March 2015 Page 7

Santa Monica City Council Feedback Councilmembers offered a number of substantive comments and questions at the December 16, 2014 Study Session. The questions and comments posed by Councilmembers are listed below with responses, information, and recommendations.

Comment: Route 41-42 should go to Carlyle, especially on weekends.

Response: There is not sufficient ridership demand between Montana Avenue and San Vicente Blvd to make additional fixed route service a viable option at this time (see Existing Ridership by Stop Map). Where demand for transit is light, demand response service may be able to provide a higher level of convenience at a lower cost per passenger than fixed route service. Demand response service is defined by the Federal Transit Administration as any non-fixed route system of transporting individuals that requires advanced scheduling by the customer, including services provided by public entities, nonprofits, and private providers. In the case of service between Montana Avenue and San Vicente Blvd, demand response service in place would allow passengers to call BBB for the desired service. BBB, in response to the trips generated by such calls, would dispatch a vehicle to pick up the passengers and transport them to their desired destinations. BBB is exploring opportunities to introduce demand response service in areas where overall ridership is low, but may have pockets of increased demand during certain time periods such as weekend nights.

Recommendation:

Create demand response weekend night service and monitor how demand builds in order to see if ridership grows enough to warrant a higher service level.

BBB / Expo Integration Proposal March 2015 Page 8

Question: Why was the 41-42 shortened from Sunset Park in the plan?

Response: The Routes 41-42 were shortened from travelling as far south as Ocean Park Blvd in response to feedback from the Friends of Sunset Park neighborhood association (FOSP) that there were too many buses on the streets between Pico and Ocean Park Blvd, specifically on 20th Street. However, contrary to first appearances, residents of Sunset Park will have more service to Memorial Park Station, not less. Although Routes 41 and 42 will not go to Ocean Park Blvd, Route 44 and Route 16 will instead connect residents of Ocean Park Blvd to Expo on weekdays. The new service will increase the number of trips from 37 one-way trips per day on weekdays today to 62 trips in each direction. This service level constitutes a 68% INCREASE in service over what the 41-42 offers now.

Recommendation: Proceed with service as described in the Study Session.

Comment: Route 43 should have extended hours, especially in the PM peak.

Response: The plan presented at the City Council Study Session contained service from 6am-9am and 3pm to 6pm on Route 43. A reexamination of ridership patterns in this area showed demand between 2pm and 3pm equal to the demand between 3pm and 6pm, perhaps due to student and domestic help trips. Additionally, as

BBB / Expo Integration Proposal March 2015 Page 9

was pointed out in the study session, it was recognized that shutting the route down too early could sabotage efforts to build a ridership base during the rest of the day.

Recommendation: Extend service hours in the afternoon by two hours - 2pm to 7pm, rather than 3pm to 6pm. Look for ways to strengthen demand on the route in order to help it develop a strong ridership base. Consideration will be given at a later stage to a route extension, possibly to SMC Main Campus to forge a connection between the Academy of Entertainment and Technology (AET) campus and the SMC Main Campus in the Fall of 2016 when the AET campus is scheduled to reopen. This additional ridership base could help sustain and strengthen the route, and build a case for more frequency and span increases. Big Blue Bus will continue to work with Santa Monica College toward our shared goals of reducing single occupant automobile use at all campuses, and finding ways to build sustainable systems to support that goal. Expansion of service may be dependent on the outcomes of further contract negotiations and collaborative identification of funding streams to support continued growth of SMC focused transit.

Question: Why doesn't the 43 go west of 14th Street?

Response: Please see map at the beginning of this section showing current ridership in northern Santa Monica north of Montana Avenue. There is little demand for bus service between the corner of San Vicente Blvd at 14th St and San Vicente Blvd at the corner of 7th Street where Route 9 will be running. These two intersections are slightly over one-half mile away from each other. Due to the low ridership currently realized there, the area is not best suited for a fixed-route service and would be a better candidate for an expansion of demand response service, where customers can call BBB for service on demand

Recommendation: Proceed with service as described in the Study Session.

Comment: Santa Monica College Bundy Campus needs night service.

Response: Big Blue Bus reached out to SMC to understand the nighttime activities conducted on Bundy Campus. As part of that discussion, BBB learned that SMC runs a free shuttle in continuous service between Bundy Campus and Main Campus from 5:30pm to 10:20pm Monday through Thursday when the campus is most active. This shuttle connects transit passengers to the rest of the transit network providing transfers to Routes 7, 8, and Rapid 7. The presence of the free shuttle means that few riders are motivated to take Big Blue Bus to Bundy Campus directly at night. BBB boards an average of 16 riders on Route 14 on Bundy Drive in front of the campus each evening. These riders are spread across 12 trips for an average of approximately 1.3 riders per trip. Due to the presence of the free shuttle, there is little to no demonstrated demand for paid public transit.

Recommendation: Retain Route 44 planned 6pm shutdown time as shown in Study Session and refer passengers to the SMC free night shuttle.

Comment: Look for public private opportunities to create circulators within Santa Monica.

BBB / Expo Integration Proposal March 2015 Page 10

Response: Big Blue Bus is a key stakeholder in the discussion of first-and- mile opportunities, and is reaching out to other stakeholders and the City's Transportation Demand Management (TDM) team to encourage development of non-public transit first-and-last mile solutions. BBB is available to partner with the city's TDM team to encourage these private enterprises in their alternative transportation endeavors.

Comment: We need to create a baseline of ridership to assess the LA Metro San Fernando Valley service impact on BBB Route 2.

Response: Approximately 55 people per day are boarding Route 2 westbound at Wilshire and Veteran headed for Santa Monica, and the same number are alighting Route 2 at Wilshire and Veteran coming from Santa Monica. These trips are indicative of a population using the transfer point to commute from the San Fernando Valley to Santa Monica using a combination of Big Blue Bus and LA Metro services. There is indication that approximately five riders are using the service in the opposite direction to commute from Santa Monica to the San Fernando Valley.

Recommendation: Continue monitoring ridership at Veteran and Wilshire in light of the introduction of the HOV lane on the 405 to judge impacts on ridership.

Question: When is the follow up study?

Response: Ed King responded in the Study Session that the follow up study would occur in the latter half of 2017.

Question: How has duplication of service gotten resolved?

Response: Ed King responded in the Study Session that Big Blue Bus continues to work together with transit partners in the region to avoid duplication of service through focused sector specific meetings on each area. More meetings are scheduled and this effort is expected to be ongoing.

Question: Why didn’t the Rapid 20 work?

Response: Ed King responded in the Study Session that this route was built with very few trips, primarily, to put buses that were already travelling to and from Culver City into revenue service. Without a full and regular schedule, it has been difficult for passengers to make use of this service.

BBB / Expo Integration Proposal March 2015 Page 11

Question: Can the Route 8 go up and over the 4th Street bridge by request?

Response: The Route 8 bus could continue to go up and over the bridge by request, but the stops on this section of the route are not ADA accessible and it is not possible to make them ADA accessible due to the steep slopes. Big Blue Bus would prefer to close these stops for the safety of passengers and encourage use of the stops on Ocean Park Blvd at 5th Street for transferring. Elimination of these hillside stops at 4th Street will increase safety for all passengers and speed travel times.

Recommendation: Operate Route 8 through the tunnel on Ocean Park Blvd under 4th Street. Encourage transfer passengers between Routes 8 and 18 to walk between the stops on Ocean Park Blvd at 5th on Route 8 and the stops on 4th at Ocean Park Blvd on Route 18. Those not able to make that walk due to disability would be advised to transfer at ADA accessible stops in downtown Santa Monica at 4th Street and Santa Monica Blvd.

Question: Did we address Samohi concerns?

Response: Yes, Big Blue Bus management met with parents and administrators at a Santa Monica-Malibu PTSA meeting at Samohi on September 29th, 2014 to address concerns. Several attributes of the plan including the decision to transform Route 3M service to become Route 18, the decision to keep Route 9 terminating in the Civic Center, and the decision to reroute the Routes 7 and Rapid 7 to 4th Street are a direct result of those discussions.

Comment: Adding this service should help traffic.

Response: Big Blue Bus sees this plan as an integral part of the City’s goal to achieve “No Net New Evening Peak Period Vehicle Trips”.

Comment: There are concerns about 4th Street bus traffic.

Response: The plan presented to Council at the Study Session does increase the number of buses using 4th St, by approximately one bus every five minutes during the peak times. Buses will not stop between Civic Center Drive and Colorado Blvd and will continue to use the present stops north of Colorado Blvd. This increase has been vetted with City of Santa Monica Traffic Engineering department, and is not expected to cause a noticeable increase in congestion on 4th Street.

Recommendation: Proceed with service as described in the Study Session.

BBB / Expo Integration Proposal March 2015 Page 12

Comment: Route 18 needs weekend service. Also, encourage sustainability and support downtown Monica by providing night service on Route 18.

Response: Regarding weekend service, Route 3M currently has an average of 600 average daily Saturday boardings north of downtown Santa Monica. Additionally, there are 1,019 Saturday boardings on Lincoln Blvd and 1,431 boardings on Main Street in the areas paralleling the new Route 18 south of downtown Santa Monica implying latent weekend demand in this area.

Regarding evening service, Route 3M carries fewer than eight people on any of its current trips after 7pm. It is possible that the southern end of Route 18 could develop a stronger evening ridership base, as the parallel sections of Lincoln Blvd and Main Street board a total of 345 passengers after 7pm weekdays. The vast majority of those passengers are carried between 7:00 and 9:30pm.

Recommendation: Implement evening service seven days per week every 30 minutes until 9:30pm and adjust the plan to include Saturday and Sunday service on Route 18 every 30 minutes.

Comment: Routes 14 and 16 stop short of where they should

Response: BBB has invited our partner agencies to discuss our plan and look for ways to rationalize the services for the benefit of passengers, and Mr. Henry correctly identifies three missed opportunities.

Regarding rationalizing Marina del Rey services, BBB has engaged a wide constituency of agencies such as the Westside Council of Governments, the City of Los Angeles Planning Department, LA Mayor's Office, Culver City Bus, LA Metro, LADOT and the City Councilmembers from area districts to discuss duplication of service. As a result of this inquiry, Big Blue Bus is currently working with LA City Planning to conduct a Marina del Rey workshop to address the issues noted. Due to the complexity and number of parties involved, this is expected to be a prolonged exercise and may be addressed in follow up recommendations.

Regarding terminating Route 14 at Culver City Transit Center at the Fox Hills (Westfield) Mall, this request was brought to the attention of Culver CityBus. Culver CityBus has committed to work with Big Blue Bus to find solutions to the transfer dilemma. Currently, the Culver City Transit Center does not have any excess capacity and cannot accept any additional routes.

Regarding creating a transfer point between Routes 16, 3 and Rapid 3, Big Blue Bus has found a way to achieve this route and turnaround and has made the appropriate requests to LADOT.

BBB will continue to pursue individual solutions on these points and greater regional cooperation. Additional transfer points may be created in a second phase of implementation in year two.

Comment: Shuttle should be run through public private partnerships. Also, we need private shuttle pick up zones city wide. Lastly, how can GPS technology empower shuttles in Santa Monica?

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Response: Big Blue Bus is a key stakeholder in the discussion of first-and-last mile opportunities, and is reaching out to other stakeholders and the City's Transportation Demand Management team to encourage development of non-public transit first-and-last mile solutions. BBB is available to partner with the city's TDM team to encourage these private enterprises in their alternative transportation endeavors. The GPS technology continues to evolve and new solutions are appearing that may be of help to transportation providers. Given the nature and speed of the transformation of technology, this inquiry should be conducted on a case by case basis as opportunities arise.

Comment: There should be east west service at Memorial Park Station.

Response: Currently Route 5 attracts 189 daily riders between Lincoln Blvd and Bergamot Station, which is enough to indicate a continued demand for transit service. However, it is anticipated that a significant portion of these customers may migrate to Expo and then walk the remainder of the trip for east-west travel. The basis for this assumption may change as land uses change. Therefore, Big Blue Bus has asked the rail construction authority to restore the concrete bus pads on Colorado Blvd between Memorial Park Station and Downtown Station, should service be restored.

The decision to remove the service was made due to fiscal constraints and the desire to reduce duplication. East of Memorial Park Station, there is east-west service between 20th Street and the city line along Olympic Blvd on Routes 5 and 16.

Recommendation: Proceed with service on Route 5 as described in the Study Session and the associated recommendation to remove service west of Bergamot Station on Colorado Blvd. Monitor customer feedback and demand to see if replacement service is warranted on Colorado Blvd once Expo is up and running.

Comment: Should we have shuttles to Memorial Park Station?

Response: Big Blue Bus worked extensively with PCD on the Memorial Park Plan, which is still in development. This plan offers the opportunity to develop space for public/private shuttle accommodation at the station. Big Blue Bus is a key stakeholder in the discussion of first-and-last mile opportunities, and is reaching out to other stakeholders and the City's Transportation Demand Management team to encourage development of non-public transit first-and-last mile solutions.

Question: Weekend crowds are bigger. Why isn't weekend service bigger?

Response: Although downtown Santa Monica can become more congested on weekends than weekdays, bus ridership does not follow that same trend. Weekday ridership is higher than weekend ridership, both systemwide, and specifically in downtown Santa Monica.

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Average weekday ridership last summer (when weekends are most busy) was over 57,000 riders per day systemwide, more than double the average Saturday ridership of 26,700, and almost three times the Sunday average of 19,730 riders. Looking at solely the activity on the transit mall to isolate downtown Santa Monica from the system, the difference between weekday and Saturday is closer but weekday ridership is still higher. There are 1,967 people boarding on average on a weekday at the transit mall, which is 36% higher than the Saturday average of 1,447 riders at the transit mall. Service levels are less on the weekend as a result of bus ridership not following the general traffic trend of higher on the weekend.

Question: Is BBB ready with equipment and manpower to make the plan happen? Can we get small buses?

Response: Big Blue Bus will be prepared to implement the Expo service changes with new buses that have been ordered, and will be ordered over the next several months. There is only one vehicle type at issue for BBB, which is the extra small vehicle needed to run the Route 43. This need for an extra small vehicle is due to the presence of a traffic calming roundabout at 26th Street and Washington Avenue, and the turning movement limitations for a U-turn on San Vicente Blvd. Staff has identified and tested a 29-foot bus that is proposed for this service. Big Blue Bus intends to pursue purchase of four new vehicles that will be less than 32-feet in length to use in neighborhood fixed route service. This will bring the fleet of buses less than forty-feet to a total of 19, representing a 26% increase in small vehicle fleet. Additionally, Big Blue Bus intends to use two small vehicles (cutaway type or low-floor minivan) for late night demand response service. The procurement request will come before Council on the consent calendar sometime in March.

The additional service hours, changes in routes and schedules, and addition of new fleet types over the next 12-18 months will require a significant amount of personnel planning/hiring, training and transition. This process will take place over three service changes starting in August 2015.

Comment: Buses should be cut off in the evening.

Response: Service will be continuously monitored to determine when demand tapers in the evening and when service should either be diminished or eliminated for the evening.

Recommendation: Proceed with service as described in the Study Session.

Comment: Integrated payment (TAP) is good for transit. Fare integration is critical to reduced duplication of service since people will have to transfer more.

Response: Big Blue Bus already serves five busy rail stations. With the addition of seven more, bus to rail transfer is expected to make up a significantly large share of our business. As such, fare integration is crucial to our success. BBB has fully installed all TAP units and went live with TAP on March 1, 2015.

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Comment: Maybe we should be on Sepulveda if Culver City isn't ready to accommodate UCLA riders.

Response: BBB has engaged Culver CityBus in numerous meetings on the topic of service integration and how we accommodate each other in the Palms area, including additional meetings subsequent to the Council Study Session. The recommended plan works in concert with improvements that Culver CityBus has planned, and maintains or improves service levels for students. If possible, BBB would like to avoid direct duplication of service in this area, and because Culver CityBus runs the length of Sepulveda from the airport to UCLA, it seems most logical to support their efforts to fully accommodate the corridor rather than duplicate their service for a limited stretch of route.

Recommendation: Retain removal of service from Sepulveda Blvd in the plan and continue to monitor the output of Culver City’s planning process to ensure that students’ needs are met in the plan.

Question: Where are we on circulators north of Montana and in Sunset Park?

Response: The area north of Montana does not warrant additional service levels beyond a possible demand response service. The overall ridership is low along this segment and as with Carlyle and similar areas losing service, a demand response service in place during times of increased demand, such as weekend nights, would allow customers the option of riding transit. Please see the attached ridership map at the beginning of this section and discussion on other Montana area questions.

Concerning Sunset Park, this area is served in the plan by numerous routes, all of which will go to Expo Stations, including Routes 7 and Rapid 7 on Pico (downtown Station and Sepulveda Station), Route 8 on Ocean Park Blvd (downtown station and Westwood station), Route 41, 42 on Pico Blvd (Memorial Park Station), Route 44 on 14th Street, and Ocean Park Blvd (Memorial Park Station), Route 16 on 20th and 23rd Streets (Bergamot Station), and Route 14 on Centinela-Bundy (Bundy Station).

It is challenging for neighborhood circulators (short routes with small buses that serve a small area) to gain sufficient ridership to be sustainable. The routes noted above that pass through the neighborhood to key destinations are longer and are a more sustainable solution for low and medium density neighborhoods than neighborhood circulators because they have more opportunity to attract riders. There are few residents of Sunset Park who will have more than a 1,000 foot walk to Expo integrated bus service. The longest walk will be for residents near Marine Park, who will have Expo related bus service on Lincoln Blvd and also on 23rd St.

Recommendation: Proceed with service as described in the Study Session.

Comment: We need to help local people, not just do Expo based trips.

Response: Big Blue Bus is retaining much of its existing transit network, building on the strengths and eliminating some of the weaknesses. The enhancements to Routes 3, Rapid 3, 7, Rapid 7, 8, 41, 42, and 44 and

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the introduction of Routes 16, 18, and 43 will create many new transit opportunities for Santa Monica residents to move about within the City of Santa Monica and the greater area.

Plan Revisions Subsequent to the December 16th 2014 Study Session Subsequent to the City Council Study Session on December 16, 2015, Big Blue Bus reviewed Council feedback and other post-Study Session feedback from LADOT, Santa Monica College, and other stakeholder organizations. As a result of that feedback and continued analysis, minor changes were made to 13 routes. These changes involved routing at bus turnarounds and small changes to frequencies and spans of service that will not substantially alter service levels, and did not significantly impact total service hours or budget.

However, four routes in the recommended plan received substantial updates as a result of the recent feedback and this most recent set of revisions. These changes result in budget impacts and raise the total increase in service hours from the current 507,000 vehicle revenue service hours to a new recommendation of 563,250 revenue service hours, an increase of 10,250 vehicle revenue service hours over what was brought to Council during the December 16, 2014 Study Session (553,000 revenue service hours).

The above service level increase is estimated at $4.2 million in ongoing costs and will be addressed in detail in the Department’s biennial budget request.

Route 16 Route 16 has been extended to create a connection to Routes 3 & Rapid 3 on Lincoln Boulevard, adding 450 of the increase of 10,250 vehicle revenue service hours noted above.

Route 18 The recommended plan now calls for adding night service until 9:30pm, seven nights per week, as well as weekend day service. Both this new night service and the weekend service are recommended at a frequency of every 30 minutes. This route also was rerouted slightly due to LADOT feedback regarding streets in Venice. The addition of weekend service and night service accounted for 6,650 (weekend 4,000 and nights 2,650 service hours) of the increase of 10,250 vehicle revenue service hours noted above.

Route 43 This route was originally recommended as having a span of service from 6am to 9am and 3pm to 6pm. The new recommendation now includes service from 6am to 9am and 2pm to 7pm. This route is also being studied for a possible extension; however, the results of that inquiry will be brought back to council at a later date and are not included in the service plan at this time. The increase of the afternoon span of service accounted for 1,020 of the increase of 10,000 vehicle revenue service hours noted above.

Route 44 This route was shown at the Council Study Session as having a frequency of every 20 minutes all day all year. As a result of feedback offered by Santa Monica College, the recommended frequency is now every 15 minutes all day from September through June, and every 30 minutes all day for the months of July and August. This change is in response to SMC’s request to encourage student use of the extensive parking resources at Bundy Campus, entering the main and satellite campus system by using only public transit, and thereby lowering levels of

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student car trips west of Bundy Drive. The increase of frequency from every 20 minutes to every 15 minutes accounted for 2,130 of the increase of 10,000 vehicle revenue service hours noted above.

Summary The four changes above are recommended, and they increase the service plan to 563,250 annual revenue service hours, an increase of 11% over current service levels. The plan without these changes would contain 553,000 annual revenue service hours, an increase of 9% over current service levels.

System Changes from Present The Big Blue Bus Expo Integration Plan that was presented to the Council in December of 2014 is substantially similar to what is presented here. Following is a recapitulation of the core elements of the plan with updates where appropriate.

The plan can be summarized as containing the following eight core elements: new routes, enhanced rapid corridors, changed routes, eliminated routes, downtown Santa Monica core service changes, station integration, Santa Monica College and UCLA service enhancements, and LA Metro service changes in Santa Monica.

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Frequency Levels Both all-day high frequency routes (Route 1, Rapid 3, Rapid 7, and Rapid 12) as well as peak-only high frequency routes (Route 2, Route 8, and Route 14) feature frequency levels of 15 minutes or better under the new proposal.

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New Routes There are six new routes in the Expo Integration Plan and this remains unchanged from what was presented at the Study Session in December of 2014. Each new route is designed to create new opportunities for Expo integrated ridership either through reformatting existing route segments, or travelling on completely new streets that show high probability of attracting strong ridership. Census data, key ridership locations, stakeholder feedback, and public feedback were all taken into consideration in the creation of these route corridors. New routes are described as follows:

Route 15 – Barrington Avenue This route connects Bundy Station with points north along Barrington Avenue terminating at Brentwood Village, filling in the gap in the route network between the existing Bundy Avenue service and Sawtelle Boulevard service. It remains unchanged subsequent to the December 2014 Study Session.

Route 16 – Bergamot Station – Marina del Rey Travelling from Bergamot Station in two directions, this route has numerous key ridership locations along its path including the employment center near Wilshire and Centinela, SMC’s AET Campus, Bergamot Station, SMC Main Campus, Ocean Park neighborhood, Mark Twain Middle School, Venice High School, Costco on Venice Boulevard, and Marina del Rey employment and housing. This route has been adjusted since the December 2014 Study Session to include a transfer point to Routes 3 and Rapid 3.

Route 17 – Sawtelle Boulevard This route has been created from portions of the current Big Blue Bus Routes 4 and 12. Key destinations along this route include UCLA, the Veterans Administration Campus, Sawtelle Boulevard, three Expo Stations including Sepulveda, Palms and Culver City, Hamilton High School, and University Village Apartments (UCLA housing). It remains unchanged subsequent to the December 2014 Study Session.

Route 18 – Montana – Abbott Kinney Boulevard Connecting the Montana Avenue service with the Downtown Expo Station and a new corridor to the south is expected to strengthen this corridor in terms of its ability to attract riders. Key destinations on this route include UCLA, Brentwood Village, Montana shopping area, Lincoln Boulevard north of downtown, Rose Avenue shopping area, Venice Family Clinic, Venice Skills Center, and Abbott Kinney Boulevard shopping. This route was rerouted subsequent to the December 2014 Study Session to include 6th Street through downtown Santa Monica, and in Venice to use 7th Avenue rather than 6th Avenue between Rose Avenue and California Avenue.

Route 42 – 14th Street – 20th Street This new route will complement the current Route 41, which currently runs in a clockwise loop. The new route will run the same loop in the opposite direction, counterclockwise. This route will be the key connector for the first-and-last mile destinations near the 17th Street Memorial Park Station including Santa Monica College, Saint John’s Hospital, UCLA Medical Center, and Montana Avenue. It remains unchanged subsequent to the December 2014 Study Session.

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Route 43 – 26th Street – San Vicente Running during the morning and afternoon/early evening peak times with a small vehicle, this commuter service will connect homes and business in the 26th Street corridor, the San Vicente corridor, Paul Revere Middle School with the Bergamot Expo Station and jobs at the Water Garden. This route was rerouted slightly to include a layover on Stewart Street at Pennsylvania Street subsequent to the December 2014 Study Session.

Enhanced Rapid Corridors The Rapid service enhancements shown to Council in the December 2014 Study Session are still a core element of the plan. Three corridors in the Big Blue Bus System carry an average of 55% of all daily riders. Those corridors are: Pico Boulevard, Lincoln Boulevard, and Westwood Boulevard. Each of the corridors features a local service making all stops, and a rapid service making fewer stops. The rapid service has a faster end-to-end travel time and as such, it has grown in popularity. In the Expo Integration Plan, Big Blue Bus will capitalize on this shift in customer preference from local to rapid service by increasing the frequency on rapid service, and lowering the frequency on the local service. In some instances, where warranted, the total number of stops may be reduced where consolidation makes sense due to ridership patterns. On the Westwood corridor, the Route 12 local service is eliminated altogether, but Route 8 service will operate locally in the corridor. Since rapid service operates end-to-end on the route faster, it is less expensive to run per passenger carried. This change is expected to increase efficiency levels on these corridors and increase passenger satisfaction. These rapid route enhancements were adjusted slightly on the Pico, Lincoln and Westwood corridors subsequent to the December 2014 Study Session based on further study of the ridership patterns.

Changes to Frequency, Span or Route Seven routes other than those mentioned above receive a variety of recommended changes in the Expo Integration Plan as had been noted in the December 2014 Study Session. Routes 1 and 14 are extended to Marina del Rey and Playa Vista, respectively, to provide new connectivity to Expo stations from those areas. Route 5 is shortened on both ends where it duplicates other services. Routes 8, 9, and 44 are rerouted slightly to optimize their performance and in consideration of impacts on neighborhoods. Weekend service is eliminated on Route 10 to help provide needed resources for other routes, and eliminate redundancy with the rail line.

Eliminated Routes As was shown in the December 2014 Study Session, four routes are eliminated, altogether, in the plan as follows:

• Route 4 is routinely one of the poorest performing routes in the Big Blue Bus system. Key ridership destinations along the route are included in the plan along Routes 5, 7, Rapid 7, 14, 15, 17 and 43. • Route 6 is eliminated in an effort to reduce duplication of services. • Route 13 services local neighborhoods south and east of Century City. Parts of this route will be served by Route 5, 7 and Rapid 7, and Big Blue Bus is in discussions with Culver CityBus and LA Metro about how their services could better assist riders in these areas. • Route 20 will be directly duplicated by the new Expo line and is eliminated in the plan as a result.

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Downtown Santa Monica Core Service Subsequent to the December 2014 Study Session, the plan was changed to retain the layover for Routes 3 and Rapid 3 at 5th and Arizona, and layover for Route 10 at 2nd St and Colorado, pending further study of options.

There are a number of other elements of the downtown plan which remain the same as was shown in the December 2014 Study Session as follows:

• Reduce bus traffic on the Transit Mall west of 4th Street by 50% • Facilitate transfers from all routes to the Expo Downtown Station • Reduce duplication of services with LA Metro through a 15% reduction in LA Metro trips to downtown • Reduce total bus miles travelled in the downtown area by 42,000 miles per year through strategic rerouting of buses • Move bus layovers off of Broadway to the corner of 7th Street and Olympic Boulevard

Station Integration Big Blue Bus has been working extensively with City of Santa Monica and City of Los Angeles to ensure that passengers making transfers at all stations will have a seamless experience. Initiatives under discussion include provision of way-finding signage, new bus berths, pedestrian improvements, and provisions for other users such as taxi, kiss-and-ride, corporate vans, and ADA Paratransit, in order to keep these users from parking in bus stops.

Enhancements to Santa Monica College & UCLA As Big Blue Bus’ two largest customers, a more focused review was made of services to Santa Monica College and UCLA campuses in order to look for ways to increase efficiency and provide better service. Subsequent to the City Council Study Session on December 16, 2014, additional meetings were held with Culver CityBus and student representatives from UCLA, as well as with representatives from Santa Monica College.

Currently, Santa Monica College is served by Routes 7 and Rapid 7 on Pico Boulevard, Route 44 connecting to Bundy Campus, and Route 41 connecting northward along 14th and 20th Streets. Working with Santa Monica College and the City of Santa Monica Planning and Community Development Team through the Memorial Park Neighborhood Plan Process, Big Blue Bus developed a plan to enhance service to Santa Monica College. Two new corridors will have direct connections to the campus via Route 16. The corridor to the south will travel via 23rd Street to Walgrove to Marina del Rey. The corridor to the north extends northeast to as far as Saltaire and Wilshire, connecting the main campus with the newly expanded AET Campus at Stewart and Pennsylvania Street and making connections for students transferring from Santa Monica and Wilshire bus routes. Subsequent to the December 2014 Council Study Session, SMC made the request that the frequency on Route 44 be restored in the plan to its current every 15 minute frequency and that change was made in the recommended plan. Additionally, BBB is exploring the possibility of creating an extension to Route 43 once the AET campus opens in late 2016 to serve the dual purposes of creating a strong ridership base for Route 43, and providing increased frequency for students travelling back and forth between campuses.

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UCLA is currently served by six routes, including Routes 1, 2, 3M, 8, 12 and Rapid 12. In the Expo Integration Plan, there are still six routes serving UCLA (1, 2, 8, 12, 17 & 18), but more destinations are available as a one- seat ride from campus. The transformation of Route 3M into Route 18 will mean that students, faculty and staff in eastern sections of Venice will now be able to get to campus without changing buses, and the extension of the Sawtelle Route 17 to UCLA will mean that residents along Sawtelle Blvd will also now be able to ride to campus without transferring.

LA Metro Changes in Santa Monica The Big Blue Bus Expo Integration Plan includes changes for LA Metro that reduce overlap and duplication of service, and reduce overall bus miles in the City of Santa Monica. LA Metro has preliminarily agreed to the recommended changes in routing and is expected to retain their current layover locations in downtown Santa Monica during this transition.

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Route by Route The following is a series of route maps, details of span and frequency and key points of changes.

Route 1 – Santa Monica Boulevard Downtown Santa Monica routing is adjusted to serve the station, the southern extension is eliminated to Venice High School and instead, the route is extended to Marina del Rey. The southern portion of route formerly going to Venice High School is now replaced with Routes 16 and 18.

Proposed Frequency Route 1 Span Peak/Base/Eve Weekday 5:30 – 00:30 10 / 10 / 15 Saturday 6:00 – 00:30 15 - 20 Sunday 6:30 – 00:30 15 - 20

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Route 2 – Wilshire Boulevard Route 2 terminates at the Downtown Santa Monica Expo Station with little change to the frequency and span of service.

Frequency Proposed Route 2 Span Peak/Base/Eve Weekday 6:00 – 22:40 15 / 20 / 30 Saturday 6:00 – 22:40 20 - 30 Sunday 6:30 – 22:40 20 - 30

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Route 3/Rapid 3 – Lincoln Boulevard The proposed plan shifts resources to increase frequency on Rapid 3 and decrease frequency on the local Route 3, with more Rapid 3 service added on weekends and bus stops being consolidated.

Proposed Frequency Proposed Frequency Route 3 Span Peak/Base/Eve Rapid 3 Span Peak/Base/Eve Weekday 5:00 – 00:45 20 / 20 / 30 Weekday 6:00 – 20:00 10 / 12 / 20 Saturday 5:30 – 00:30 20 - 30 Saturday 6:00 – 19:00 20 Sunday 5:30 – 00:30 20 - 30 Sunday 6:30 – 19:00 30

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Route 4 – San Vicente Boulevard & Carlyle Avenue This route is deleted in the plan. High ridership areas are served on other routes as follows: Route 9 on 4th Street between downtown and San Vicente Boulevard, Route 43 on San Vicente between 26th and 14th Streets, Routes 14 and 18 on San Vicente Boulevard in Brentwood, Route 17 on Sawtelle between VA and Sepulveda Expo Station, Route 7 and Rapid 7 on Pico Boulevard, and Route 5 on Olympic Boulevard.

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Route 5 – Olympic Boulevard – Revised This route is shortened on both ends in the plan to reduce duplication with LA Metro and Expo Line. Sections deleted are east of Century City and west of Bergamot Station. There will be peak only service on Motor Avenue to replace part of the service lost on Route 13 until Culver City adds service there, at which point Big Blue Bus will discontinue service on Motor Avenue.

Proposed Frequency Route 5 Span Peak/Base/Eve Weekday 5:30 – 21:00 30 / 30 / 30

Saturday 6:00 – 21:00 60 Sunday 6:30 – 21:00 60

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Route 6 – SMC Commuter This route is deleted in the plan as all sections are served by other routes.

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Route 7/Rapid 7 – Pico Boulevard The primary focus of the change to this route is to shift resources from local Route 7 to Rapid 7, and to add weekend service on Rapid 7. This route is also rerouted in Downtown Santa Monica from Ocean Avenue to 4th Street. Lastly, three trips on this route will be deviated in each direction to accommodate former Route 13 riders in Beverlywood.

Proposed Frequency Route 7 Span Peak/Base/Eve Weekday 5:00 – 00:30 20 / 20 / 30 Saturday 5:30 – 00:30 20 / 30 Sunday 6:00 – 00:30 20 / 30

Proposed Frequency Rapid 7 Span Peak/Base/Eve Weekday 5:30 – 23:00 7 / 8 / 15-20

Saturday 6:00 – 19:00 30

Sunday 6:30 – 19:00 30

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Route 8 – Ocean Park Boulevard – Revised This route has two small reroutes as follows: use Ocean Avenue in Downtown Santa Monica instead of Main Street to 2nd Street, and operate through the 4th Street underpass on Ocean Park Boulevard instead of up and over 4th Street.

Frequency Proposed Route 8 Span Peak/Base/Eve Weekday 6:00 – 23:30 15 / 20 / 30-60

Saturday 6:00 – 23:30 30 Sunday 6:30 – 23:30 30

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Route 9 – Pacific Palisades This route is adjusted to use 4th Street between San Vicente and Downtown Santa Monica instead of 7th and 6th Streets.

Proposed Frequency Route 9 Span Peak/Base/Eve Weekday 6:00 – 22:30 15 / 30 / 60 Saturday 6:00 – 22:30 30 Sunday 6:30 – 22:30 30

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Rapid 10 – Freeway Express This route remains largely the same except for the removal of weekend service and rerouting in the downtown area. This route may see further changes once Expo ridership patterns stabilize.

Proposed Frequency Rapid 10 Span Peak/Base/Eve Weekday 5:30 – 20:50 15 / 30 / 30 Saturday - - Sunday - -

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Route 12/Rapid 12 – UCLA/Westwood Boulevard The plan for these routes is to consolidate them on the current Rapid 12 route and to shift the terminus from Culver City Station to Motor and Washington.

Proposed Frequency Rapid 12 Span Peak/Base/Eve Weekday 5:30 – 23:00 7-8 / 12 / 20-30 Saturday 6:00 – 22:00 30 Sunday 6:30 – 22:00 30

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Route 13 – Cheviot Hills This route is deleted in the plan. Riders can access Route 7 or Rapid 7 on Pico Boulevard and Route 5 between Century City and Palms. Additionally, three trips in each direction on Route 7 will be detoured to the Beverlywood neighborhood for the benefit of workers there.

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Route 14 – Bundy Drive & Centinela Avenue This route is extended to Playa Vista in the plan and also shortened on the highly congested northern segment to improve speed and reliability.

Proposed Frequency Route 14 Span Peak/Base/Eve Weekday 5:30 – 21:30 15 / 30 / 30 Saturday 6:00 – 20:00 20 – 30 Sunday 6:30 – 20:00 30

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Route 15 – Barrington Avenue This new route services Barrington Boulevard and Brentwood Village with connections to Bundy Expo Station.

Proposed Frequency Route 15 Span Peak/Base/Eve Weekday 5:30 – 21:00 30 / 30 / 30 Saturday 6:00 – 20:00 30 Sunday 6:30 – 20:00 30

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Route 16 – Bergamot Station/Marina Del Rey

This new crosstown route travels from Saltaire and Wilshire to Lincoln and Mindanao via Bergamot Station, Santa Monica College, 23rd Street, Walgrove Avenue, Venice High, Costco on Venice Blvd., and Marina del Rey.

Proposed Frequency Route 16 Span Peak/Base/Eve Weekday 6:00 – 19:00 30 / 30 / 30 Saturday - - Sunday - -

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Route 17 – Sawtelle Boulevard This new route connects UCLA to key university housing along Sawtelle Boulevard. It also connects major destinations such as the VA Medical Center, Hamilton High School, Sawtelle Boulevard shops, and Palms Boulevard housing to the Sepulveda, Palms and Culver City Expo Stations.

Proposed Frequency Route 17 Span Peak/Base/Eve Weekday 6:00 – 21:00 30 / 30 / 60 Saturday 6:00 – 20:00 60 Sunday 6:30 – 20:00 60

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Route 18 - Abbott Kinney / Montana / UCLA This new route strengthens the previous Route 3M by connecting the Montana portion of the route to the 4th Street segment to Abbott Kinney, and uses small vehicles to address concerns expressed by 4th Street residents. This route has been adjusted to utilize 7th Avenue between Rose Avenue and California Avenue, and now features service on nights and weekends. This route is shown with two frequency and spans of service in the recommended plan.

12/2014 Proposed Frequency Route 18 Span Peak/Base/Eve Weekday 6:00 – 19:00 30 / 30 / 30 Saturday Sunday

Revised Route Frequency 18 Proposal Span Peak/Base/Eve Weekday 6:00 – 21:30 30 / 30 / 30 Saturday 6:00 – 21:30 30 Sunday 6:30 – 21:30 30

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Rapid 20 – Expo Culver City (Delete Route 20) This route is deleted in the new plan as riders can use Expo Line in place of Rapid 20.

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Route 41-42 – Memorial Park Station Loop This route is adjusted in the plan to become bi-directional, and is rerouted on the 20th Street alignment to service the Memorial Park Station. The route is shortened to Pico Boulevard rather than Ocean Park Boulevard to address neighborhood concerns, and weekend service has been added in response to public feedback.

Proposed Frequency Route 41 Span Peak/Base/Eve Weekday 6:00 – 21:00 15-20 / 30 / 30 Saturday 6:00 – 20:00 30 Sunday 6:30 – 20:00 30

Proposed Frequency Route 42 Span Peak/Base/Eve Weekday 6:00 – 21:00 15-20 / 30 / 30 Saturday 6:00 – 20:00 30 Sunday 6:30 – 20:00 30

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Route 43 – 26th Street/San Vicente This is a new peak-only weekday route with a small vehicle that will connect the San Vicente and 26th Street corridors with Bergamot Station. This route is now recommended with eight hours of service per weekday, rather than the six hours as shown in the December 2014 Study Session. An option to extend this route, possibly to Santa Monica College Main Campus is being examined for after the AET campus reopens, but is not being included in this iteration of the plan.

Revised Frequency Route 43 Span Peak/Base/Eve Weekday 6:00 – 9:00 30 / - / - 14:00 - 19:00 Saturday - - Sunday - - 12/2014 Proposed Frequency Route 43 Span Peak/Base/Eve Weekday 6:00 – 9:00 30 / - / - 15:00 - 18:00 Saturday - -

Sunday - -

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Route 44 – Airport & Bundy to Memorial Park Station

Route 44 is rerouted in the plan to extend to the Expo Station at Memorial Park, and is also rerouted between Pico and Ocean Park to 14th and 17th Streets to lessen bus frequency on 20th Street as a result of community feedback. This route is now recommended with a 15 minute frequency rather than the 20 minute frequency that was shown in the December 2014 Study Session. It is also recommended with a 30 minute summer frequency in both options based on SMC feedback and current ridership observations.

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Summer Revised Frequency Route 44 Span Peak/Base/Eve Weekday 6:30 –18:00 30 /30 / - Saturday - -

Sunday - -

Winter Revised Frequency Route 44 Span Peak/Base/Eve Weekday 6:30 –18:00 15 / 15 / - Saturday - - 12/2014 Winter Proposed Frequency Sunday - - Route 44 Span Peak/Base/Eve Weekday 6:30 –18:00 20 /20/ - Saturday - - Sunday - - 12/2014 Summer Proposed Frequency Route 44 Span Peak/Base/Eve Weekday 6:30 –18:00 30 /30/ - Saturday - - Sunday - -

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Downtown Santa Monica Routing The downtown routing shown reduced bus traffic west of 4th Street by over 50% and removes layovers on Broadway, moving them to new layover areas on 7th Street and Olympic Boulevard. Subsequent to the December 16th Study Session, Route 18 was moved to 6th Street in one direction in order to lessen bus traffic in the core.

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Late Night Expo Demand Response Service Much of the bus network will cease operations earlier than the rail does on weekends. Following, is a BBB proposal to provide Friday and Saturday evening demand response service to Santa Monica residents, workers, and guests.

Introduction The Expo Line is anticipated to operate until approximately 1 a.m. Sunday through Thursday. On Friday and Saturday evenings, Expo service will be extended to approximately 3:00 a.m. Late-weekend service is designed to accommodate the employment and entertainment opportunities found in downtown Los Angeles, including the Staples Center. In Santa Monica, Big Blue Bus services operate until after midnight, and several routes operated by LA Metro provide late-evening, or owl, services. None of the late-evening services, however, are designed to provide last- mile service to/from Expo stations. Public outreach, including public meetings, surveys, stakeholder outreach, and neighborhood meetings, indicates demand from Santa Monica residents to use Expo Line service for entertainment purposes in downtown Los Angeles. The lack of late-evening service from Expo stations to neighborhoods was raised repeatedly. In order to respond to these demands, a new late-night demand-response service is proposed to connect Expo to adjacent Santa Monica neighborhoods.

Service Description To efficiently and effectively meet the new late-night service demand noted above, a pilot program would be initiated by BBB to operate curb-to-curb service from the Memorial Park Station to two zones serving neighborhoods to the north and south. The zones are designed to allow a vehicle to make pickups and drop-offs and be back at the 17th Street Station within approximately 30 minutes. The service is designed to provide first- and-last mile transportation to and from Expo. Accordingly, the origin or destination of every trip must be the 17th Street Station. Downtown Santa Monica is not included in the pickup zone, as connections between the 4th Street Station and Downtown will be available via LA Metro’s late-night service on Santa Monica Boulevard and Wilshire. The following map shows the proposed service area.

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The demand-response service is modeled on making a real-time reservation for service using either a phone call or a mobile app similar to ridesharing services such as Uber or Lyft. A pickup would occur within 20 to 30 minutes of the call. A reservation could also be made to meet specific trains at the 17th Street Station to ensure a seamless transfer. The proposal would recommend utilizing the current Dial-a-Ride vendor, MV. The vehicle used for this service would be wheelchair-accessible vans similar to the ones used for WISE & Healthy Aging/Santa Monica Dial-A- Ride. The vehicle would be wheelchair lift-equipped and be able to handle passengers with mobility impairments. The late-night demand-response service would operate on Friday and Saturday nights only, corresponding with later-evening Expo Service. The service hours would be from 8:00 p.m. to 3:15 a.m., with service to the last train arriving in Santa Monica.

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Fares The evening demand-response service is a premium service as it provides curb-to-curb transportation. Accordingly, the proposed fare is higher than the regular fixed-route fare. A fare of $3 per trip is proposed. The $3 fare would be a flat fee for a ride to a single destination, from a destination, regardless of the number of passengers. If passengers requested more than one destination leaving the 17th Street Station, then passengers would be charged a flat $3 fare for each destination. Consistent with FTA guidelines, no discounts for elderly or disabled passengers are required, due to the demand-response nature of the service. Big Blue Bus may not opt to install fareboxes that take all existing fare media on these vehicles. Accordingly, Big Blue Bus must still fully develop how payments will be accepted. Options that must be considered include payment by credit card (like Uber and Lyft utilize), using prepaid fare media, installing a farebox that accepts passes and/or TAP cards, and cash payment. The proposed $3 fare is competitive with Uber, Lyft, or taxi pricing. An Uber trip within either the proposed North or South zone costs between $4 and $8 depending on distance, and has a minimum charge of $4. The $3 demand response fare would be less expensive, but may take longer based on the fact that passengers may be sharing rides to and from the station with other parties.

Estimated Cost of Service Operating weekend evening service will require approximately $108,000 assuming the cost/hour is similar to that of MV’s existing contract with Big Blue Bus for similar Dial-A-Ride service. It is possible that due to the late- evening nature of this service, the cost per hour would increase to accommodate maintenance and supervisory staff.

Cost and Parameters of Service Number of Service Days (Fri-Sat) 104 Daily Vehicle Hours 14.5 Annual Vehicle Hours 1,664 Estimated Annual Cost (@ approximately $53.00/hour) plus reservation system $108,000 and infrastructure costs

Estimated Ridership Projected ridership on the weekend demand-response service must account for two factors. 1. The Expo line is new, and patronage patterns will evolve over the first two years of operation. As the number of patrons increases, so will demand for late-evening service. 2. General public demand response service by design carries less people than fixed-route service. It is unreasonable to expect a single vehicle to accommodate more than 10 pickups per hour. Typically, 3-6 pickups per hour are expected during daytime hours. Evening demand will likely be lower at first.

A conservative estimate of 2.5 pickups per hour is assumed. This is consistent with typical productivity numbers for demand-response service. Annual ridership is projected to be 4,160 pickups.

With a fare of $3 per pickup, annual revenue is anticipated to be approximately $11,232, which results in an estimated farebox recovery ratio of 11.6%.

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Estimated Ridership and Revenue Number of Service Days (Fri-Sat) 104 Daily Revenue Service Hours 14.5 Pickups per Day (2.5 trips/hour/vehicle) 36 Annual pickups 3,744 Annual Revenue ($3/trip) $11,232 Farebox Recovery Ratio 10.4%

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Next Steps ■ Council Adoption (and Public Hearing) of final plan - March 2015

■ Public outreach program on the new routes – Summer 2015

■ Bus stop installation – Summer 2015 – Summer 2016

■ First set of route changes – August-September 2015

■ Second set of route changes – Spring (March-April-May) 2016

■ Expo Phase II begins operation – Spring-Summer 2016

■ Third set of route changes – Summer 2016

■ Follow up study – June - December 2017

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