The following transcript is provided for your convenience, but does not represent the official record of this meeting. The transcript is provided by the firm that provides closed captioning services to the City. Because this service is created in real-time as the meeting progresses, it may contain errors and gaps, but is nevertheless very helpful in determining the gist of what occurred during this meeting.

>> Mayor Liccardo: Good afternoon, the meeting for June 2nd, 2015, is called to order. I'd like to introduce our invocator Ken Henry, from district 6. Councilmember Oliverio.

>> Councilmember Oliverio: You did it. He will be doing the invocation tonight as well. Reverend Henry.

>> In the midst of old homes new homes, traffic filled streets and brown lawns, business people pursuing their dreams, God of urban places we meet here, in the area of possibility and possibility, sacred commission the care and intention of making our lives better. They are here to keep a watchful eye on justice. They are here to piece together decisions on our behalf. Be with them. Open channels of communication and conversation. Remind all present that you created individuals with two ears so we can listen twice as hard and speak less. Keep your leaders strong many strong in wisdom strong in compassion and strong in forging purposeful agreements. Help us then help them to see down the road and in their seeing, inspire us all to serve and honor one another. Amen.

>> Mayor Liccardo: Thank you, reverend. Please rise for the pledge of allegiance. [ pledge of allegiance ]

>> Mayor Liccardo: On orders of the take, I know there's a staff ask for continuance on 6.2. Can we do that as part of the orders?

>> City Attorney Doyle: You can can do that as part of the orders of the day.

>> City Attorney Doyle: For 6.2 and 6.3.

>> Mayor Liccardo: No I believe it's just 6.2, that staff is requesting, is that right Dave? That's correct.

>> Councilmember Herrera: Motion to approve orders of the day with deferral of 6.2.

>> Mayor Liccardo: Is there a second? I understand there's some problems with the electronic displays is that right Maggie, we're going to vote verbally going back to the old days. That passes unanimously, I think. We'll verify it later. Closed session report Rick.

>> City Attorney Doyle: We have no report.

! 1! >> I'll ask Vice Mayor Herrera to join me at the podium. For Alzheimer's month. I just got my bracelet.

>> Councilmember Herrera: Thank you mayor. You have purple bracelets and shirts courtesy of the Alzheimer's association, we Hope some of you will put them on. So I'm honored today to proclaim the month of June to join with the mayor and city council to declare the month of June as Alzheimer's and brain awareness in the City of San José. We wear the purple in response to the purple pledge to support those facing Alzheimer's and other dementias and to commit to raising awareness. This disease as many of you know affects an enormous amount of people worldwide in our country, incredible cost, horrible cost to patients, to families, physically, emotionally and financially. Worldwide, 47 million people are living with this disease. $604 billion is the annual global cost of dementia. Every 67 seconds someone in the United States develops Alzheimer's or other dementias. Alzheimer's is the sixth leading cause of debt in the United States, unfortunately there is no cure, it can't be prevented cured or even slowed down although there are drugs that deal with symptoms. Almost two-thirds of Americans who live with Alzheimer's are women. When you donate money to the Alzheimer's association there's research going on. And I think one of the impactful things to me is how much money we spend and how much we could save if we could just find treatment for Alzheimer's, that could just delay it. The U.S. could save $220 billion within the first five years of a treatment for Alzheimer's disease. And this is according to Alzheimer's association report called changing the trajectory of Alzheimer's disease. How treatment by 2025 saves lives and dollars. This treatment if we could get it by 2025, would delay the onset of Alzheimer's cut the number of people who have the disease from 42%, from a projected 13.5 million to 7.8 million in 2025. Threechg 2025 goal would save 360 billion in 2015 aloan. Save $54 billion over the first five years out of their out of pocket cost if the 2025 goal is met. So this reinforces the goal set by the national plan set by the Alzheimer's disease, and if the federal government were to invest $2 billion a year as recommended by the scientific community then it would recoup its investment within the first three years after treatment became available. Donating money to Alzheimer's association, supporting them supports us trying to reach those kinds of goals. Not only important for people that are stricken with Alzheimer's and their family but it is important to the entire country, in terms of where we want to put our dollars and other things we would like to treat. Today Alzheimer's association of Northern California, northern Nevada chapter are here to accept a proclamation declaring the month of June, as we said, Alzheimer's and brain awareness month. I welcome Eddy yew, and Eric Shay, I knew Lilyana when she was in another capacity. My mother had Alzheimer's and she was involved in that care-giving. The Alzheimer's association was formed in 1980 and aims to advance the research to end Alzheimer's and dementia while enhancing care for those living with the disease. There's another event coming up that Alzheimer's association is celebrating. An annual event to raise awareness of the Alzheimer's association. This sunrise to sunset event symbolizes the challenging journey of those living with the disease and their caregivers. In fact there is a book called the 36 hour day, good for everyone but especially those who live with this disease. It is

! 2! enormously hard on families and caregivers as well as those who two through this. Someone who is living with or lost to the disease selecting his or her favorite hobby. As I just kind of hinted at, I was personally affected, my mother passed away from Alzheimer's in may six years ago, the year I took office. I understand the struggle. I feel emotional even talking about it now. It's a tremendous loss to a dpeax losing someone a bit at a time over many years. By the time the person -- the time my mom died it was no longer her and she didn't know me or anybody in my family. So it's just a horrible, horrible progression, and I'm so grateful that we have the Alzheimer's association, that is working to find cures to find ways to support families and caregivers who must endure this. So while we proclaim the month of June as Alzheimer's and brain awareness month let's continue to keep those suffering in our thoughts and prayers and remember those who have passed there this disease. I would like to thank the Alzheimer's association again for their efforts to find a cure. I would ask Mayor Liccardo to present Eddie Lau with a proclamation and I invite Eddie to say a few words. [applause]

>> Thank you very much, Vice Mayor Herrera. 5 million Americans in the United States have Alzheimer's and 5 million families like yours have been dealing with this. We do need to find cure. I should mention Alzheimer's association is the third largest funder of Alzheimer's research in the world. The first is the be Chinese government and the second is the Alzheimer's association and the third is the United States government. I want to share a little something. Cynthia Guzman, on our national level, she was disked with Alzheimer's on her 63rd birthday. She was a registered nurse, she suddenly got herself lost not knowing which side of the road to be on. From her diagnosis she has been just very active telling her story. So that more people would see what this is. She says I'm running a race and it's a race I'm not going to finish. I tell my story because I need other people to help finish the race for me. This isn't a race where we get a gold medal. It's one that ends Alzheimer's. Thank you very much. Fest [applause]

>> Mayor Liccardo: Next I'd like to ask Rudy Guivara to join us. Vice Mayor Herrera has more.

>> Councilmember Herrera: So today I'm really again proud and honored to present a commendation on behalf of the American and city council to Rudy Guivara. Rudy is an Evergreen resident San José resident long time. He was just recently in May, inducted into national wrestling hall of fame. We're honoring him not just for that but for the work he's done in San José. He didn't start in San José but he has contributed a lot to this city. He was a coach. He was raised in Monterey county after losing his father in Vietnam. He is responsible for taking care of a seriously ill mother. Every time he left to attend school he wasn't sure his mother would be okay when he got back. Yet through adversity that would crush many of us, Rudy was able to persevere. Extracurricular opportunities helped to give himself strength. He eventually made his way to San José State university where our city was happy to welcome him. Rudy's experiences helped him to quickly become a leader at the university. When his

! 3! degree was finished we loved him too much and wouldn't let him leave as San José State university offered him a job as an assistant coach. From there he went on to coach the U.S.A. team in the Olympics. Fourth coach in U.S.A. history to coach four separate Olympic festivals. With so so much under his belt, he has taught people with disabilities, children with incredible talent adolescents and adults alike. Through all of his coaching he assures he does not squander the chance to teach about responsibility equity hard work and cooperation. Now in events spanning everything from cities to the nation, we could probably look back to everything that Rudy has given back, saying we are lucky to adopt him and him us. And with that I would like to ask Mayor Liccardo to present Rudy Guivara with this commendation. Congratulations Rudy. [applause]

>> Where did you get all this information on me? I'd like to thank City of San José for this acknowledgment. Mike, Jude owes player, Mr. and Mrs. Cano, Ted was my mentor out of college. Working at Santa Teresa he has taught me a lot. Mr. Hernandez, thank you. Matt Cano he's one of your employees here. Matt I remember bringing Matt to San José State when he was probably five years old, come and watch me wrestle. And now he has a five-year-old. Very happy for that. I did -- I came up here my freshman year aged 17 years old from Monterey county, Gonzales, population 3,000, and I remember coming to San José and just such a big, our school was 800 kids, remember coming up here to San José State and was overwhelmed with everything. And you know athletics kept me going, kept me part of what I wanted to do in my career and I always work with other children and youth. Team San José, San José is my home town, like I said everywhere I travel throughout my competitions I've always been very proud to be a part of this community and the people in it. It's a great town. I've seen a lot of places, Oklahoma to Istanbul. We have it all here. Again if I could leave a message upon leaving to invest in our youth. I was a kid that could have went both ways and I had some great coaches that steered me over the other way. The results are this. And I've seen the other results. I'm sure we read it in the papers every day. So my message is put money into our youth, prevention instead of correction. I'm involved with extreme martial arts, keeping kids out of the street, keep them busy, out of trouble. It's well worth time and investment in money, keeping our community safe. So that's once again, I thank you all. This is wonderful. Thank you all.

>> Mayor Liccardo: Now I'd like to invite several folks up to the podium. Silicon Valley organizer for full.S, I'm going to get your last name wrong manzini. I'm close, getting there. And lots of folks from SEIU and sigh rental and many organizations that are supporting everything we want to do. I want to invite several colleagues, councilmember Ash Kalra, immigrant from Canada, and Johnny Khamis, having spent time in Canada, that's not true. And councilmember Magdalena Carrasco. We are proud to be in the City of San José, a city of immigrants. Almost 40% of our population hailed from other countries. The immigrant heritage month honors the way our country has shared a very productive history. We are striving to better serve our population. Like Silicon Valley law foundation and siren and

! 4! Asian law alliance and million others who are helping us certainly great partners at the county, the council strongly supported the creation just a few weeks ago of the office of immigrant affairs and we are going to be working hard through that office to ensure we are doing better to reach out to the many immigrants in our country, as we hope Daca and DAPA offer opportunities for our immigrants to establish their category in the country. I'd like to vied Kay Aragon to speak. Okay. Wonderful if they could just come forward.. Thank you.FTC.

>> It is our honor. It's you're honor, on behalf about of national heritage month with the number of immigrants and children of immigrants in San José with members from community organizations like SWD.us, SEIU and with honored members of the city council and mayor Liccardo, to recognize our immigrant heritage.

>> With more than 200 partners nationwide including the White House, immigrant heritage month is off to a great start, thanks to you all. If you have a story to share please visit welcome.us and put it there. Thank you.

>> Hi everyone. My name is Shaza, you have heard my story before. My husband works for Microsoft. We came here in 2013, immigrant heritage month means a lot to me. It welcomes diversity and shuts doors on negativity. It promotes a sense of community across faces. Reflect on the positive roles that immigrants have had in shaping our technology our community and our delicious cuisines. We know that you -- we know that as you remember these instances you honor all those who come here seeking for one reason or another a better life. Thank you for your support and happy immigrant heritage month. [applause]

>> Mayor Liccardo: Let's all get in here for a photo if possible.

>> Mayor Liccardo: We're on to the consent calendar. Are there any items that council would like to pull at this time? Councilmember Khamis.

>> Councilmember Khamis: Item 2.8.

>> Mayor Liccardo: Item 2.8.

>> Councilmember Oliverio: 2.2E.

>> Mayor Liccardo: 2.2E from Councilmember Oliverio. Any other items? We'll entertain a motion on the other items.

! 5!

>> Motion to approve the remainder.

>> Mayor Liccardo: Motion and second, all in favor, any opposed? The remainder passed. We have, forgive me. We have items which members of the public would like to speak and I neglected to pull them as well. I'm going to ask David Wall to speak at this time on item 2.7 and 2.13. We'll ask for a motion for reconsideration at that time.

>> Thank you Your Honor, I'll be brief. 2.7 there should be a few questions with the sublease agreement on the county and household hazardous waste program. This is a sweet deal, with reference to the albatross of the regional water facility. Maintenance of which should be made to you with reference to the City Manager. Actions 20142015 sidewalk repairs I would encourage sidewalk repairs also start to include mandatory percolation materials to start capturing what water we will receive, instead of having it run off to the storm drains. So this should be done citywide considering the vast square miles of surface area covered by concrete and asphalt and what have you. Thank you.

>> Mayor Liccardo: Thank you sir, at this time if any of my colleagues would like to pull 2.7 or 2.13 for reconsideration we can do so. Seeing no requests, we'll move on. Councilmember Oliverio.

>> Councilmember Oliverio: Thank you mayor. This started as a kind of wild meeting but ended up coalescing into a fairly good project. The developer did offer radar speed signs. I didn't include that in my motion, I'll make a motion to approve 2.2 E.

>> Second.

>> Mayor Liccardo: With an amended, that is to include the additional condition.

>> Councilmember Oliverio: Yes, the offer by the developer to put two of them. Thank you.

>> Mayor Liccardo: Motion and second, any comment? All in favor, any opposed that passes unanimously. On to item 2.8. Councilmember Khamis.

>> Councilmember Khamis: So this is an item that's actually circumvented a lot of our priority decision making criterias. And it's called a butt out of our bars ordinance which will not allow bars to have coupon distribution for cigarettes. While I am not a smoker, and don't encourage smoking to anyone, I wish that this ordinance would not be in place. I'd rather see government butt out of our lives, quite frankly, especially butting out of lives.consenting adults who choose to be in bars. And I just -- this is --

! 6! there's a lot of assumptions being made here. I've heard things on the radio, I've heard things from my colleagues about youth being concerned about, this will not address that issue in its entirety. Unless you call individuals 21 and above youth, it won't address that. These coupons are only being distributed in bars. And of course if you are in a bar you're already conducting yourself in a manner that may cause more harm to you than receiving a coupon. Once more, giving somebody a coupon doesn't necessarily mean that they are going to go out and buy something. I just looked through my mailbox yesterday, and I have received dozens of coupons, dollar off of chocolate, I have $2 off of Sutter home wine, and this is -- this, I saw my children with this coupon here. The back of the Hsueh flyer. $2 of oof Tagqueray, these are not going to make me or my children go out and buy alcohol nor will a coupon being handed out at a bar force people into going outside the bar, purchasing cigarettes and coming back -- come back and smoke. I think people at the age of 21 and older have the right to determine what goes into their bodies and I don't want government telling us what consenting adults can put into their bodies. And I have real issue with some of the points that had been brought up as reasons to pass this. Also, passing this ordinance may open you us up to litigation, litigation that the corporations could have. Because coupons are public -- it's constitutionally protected free speech. And I think it could open us up to a lawsuit. I know that it's unlikely but it could. So I'm urging my colleagues, you know I'm not here to advocate for cigarettes, far from it. I'm only here to advocate for your rights as an adult, to choose whether or not you want to smoke or you want to do anything to your body because you are -- because quite frankly, at the age of 21, I hope that you have the mental capacity to know what's right and wrong for you and your own health. So I'm urging my colleagues to vote no against this new ordinance.

>> Mayor Liccardo: Councilmember Nguyen.

>> Councilmember Nguyen: Thank you, Mr. Mayor. I appreciate the in depth analysis and visible comments of my colleague. Only one of our city employees who stood up and made that point very clear, I really appreciate it, I admire his courage for that. I am a victim of tobacco, also, I smoked when I was very young, 18 years old and then confess, it took about a lifetime to clear it, I did. Not on my own. When I took this new job five months ago, coming into this building, it took all my courage to stop due to respect for these people. It is extremely difficult. I still have nightmares, I sometimes wake up, I curse myself for smoking, and I didn't. It is terrible but I think Johnny makes a very, very good point. If we forbid handing out samples, that would be a lot of sense. But to forbid someone distributing a piece of communication, I don't think -- not only it will, but it will very likely open the city to litigation. Being an attorney, I have seen both sides of litigation and for the past six months, I have seen the city on the receiving end of litigation. And the downsize is, as long as the litigants can win one minor, very minor cause of action against the city, that will cause 20 others therefore, on the one hand I respectfully agree, I support this idea a lot of doing whatever it is we can tobacco-smoking. But just reading the language of the is proposed ordinance, forbid being communication of a product by itself, I sphere the city will

! 7! open itself to litigation. With a very, very heavy heart on the one hand I support any effort to limit the tobacco but I don't think this is a proper way. Therefore I urge council, even though you may agree with it, that the form of this ordinance will later on six months or a year later will be the consequence of litigation. This mere language itself will not protect us. We promote the cause that we want to do.

>> Mayor Liccardo: Raul, I'm sorry, Councilmember Peralez.

>> Councilmember Peralez: I will take it. Influenced by my outfit as well. So I will respectfully disagree with my previous two colleagues. And certainly, and for those of you who haven't seen these marketing tools, it's a very, very intelligent marketing scheme put on by big tobacco. The fliers are enticing, ten times more than sorry Johnny these paper ones. They are very enticing. Great imagery. And they're offering something that traditionally is much more expensive, at 50% off or $1 for a pack of cigarettes. And they are not sending it to our mailbox where I imagine most of us toss out most of these advertisements that come to our mailbox. They are standing in front of bars and they are targeting bars that are for you know your first comers to bars, 21 to early 30s. And 50 the United Nations in fact they still define youth as to 24 years old, 15 to 24. As much as we would like to think that 21 we are all weld minded adults, that can make some good decisions, I can tell you I'm 33 and I can still make bad decisions. I don't think that allows us the ability to just turn a blind eye. So -- and these advertisements, this is exactly what big tobacco as done throughout the years throughout the years, big tobacco did not have to put the disclaimer that told you these were cancer-causing cigarettes and now that's changed. They continue to be very smart and have highly paid marketing and marketers. And this is one of those tools where they found a legal ally to be able to -- legal afternoon consume to be able to market to and entice new users of cigarettes. Knowing very well that inhibitions are diminished when alcohol is in one system -- in one's system. And tweeting a coupon for a $1 pack of cigarettes as you enter a bar or as you step outside of a bar with your friends, is a lot more enticing than getting a $1 off coupon for a can of tuna at your house. These are tools I have actually experienced firsthand. I have been out in our downtown core in the evening and seen these coupons handed out and seen the interest that it really brings to those that are out and those that are intoxicated. It introduced brand-new smokers, it introduces them to a cheap affordable cigarette that they may give a try to. As we all very well know, it is a fact these are addictive. This isn't something that a lollipop that you get at the dentist, this is a cigarette that's cancer-causing and doesn't just affect the user, it affects the rest of us. There was a time there was a smoking section in airplanes, I recall that, I'm not that young. And there was a time when that was completely legal and as we know that's absurd. So we put these rules and I ask agree with Councilmember Khamis in a point that sometimes government can get in a way. But without government there would thought have been any of these restrictions in place in regards to the disclaimers. In regards to removing the allowable cigarettes inside our bars here. We have to step in a way when we know that this is something that is harmful and especially something that a big tobacco

! 8! company has really taken advantage of. And what this is doing, this is not outlawing smoke being a cigarette outside of a bar. We're not saying don't smoke in San José. By all means, you know there that's still possible. You can still go into a liquor store and purchase cigarettes. What this is simply saying you found an avenue, Mr. Big tobacco company, to be able to entice and find smokers with a gimmick. We're going to put a stop that to that. Councilmember Nguyen, this has been done in a number of other cities, I apologize, I can't tell you how many. The language we developed was --

>> Mayor Liccardo: 45.

>> Councilmember Peralez: 45, thank you mayor. To my knowledge not one has been sued by big tobacco. It's highly unlikely, we are going to be sued by big tobacco.

>> Mayor Liccardo: It is my understanding there is a problem with the monitors. Hail me if I do not call on you. Vice Mayor Herrera. Then Councilmember Kalra.

>> Councilmember Herrera: Thank you mayor. We were approached in continuing his line of thinking there, we were approached by community groups asking for our help here because they felt they were being targeted 50 tobacco industry. We know as was said that 45 other municipalities in California have adopted these ordinances that extend provisions beyond California state law. This is going to cover electronic cigarettes not just traditional cigarettes and that's important because the tobacco industry is not just staying passive in their desire to get people addicted to tobacco. That is the whole goal. If you use this substance and become addicted then you're going to be a long term customer. And you know approaching folks in bars and approaching students, approaching the younger side, whether you know doesn't have to be under 21, but just in that younger category, we've already identified that younger adults ages 20 to 24 have the highest smoking prevalence of any age group. At 14.6% that was in 2011. We know that was a time more vulnerable and the tobacco industry knows it too. They're out to not only get short term customers, they're really out to get long term customers. We have an obligation as a community as a country as a society to fight back. Because as is already said it doesn't just affect the person smoking the cigarettes. There's secondhand smoke that goes everywhere. It affects the community, increases health care for everybody. It used to be advertised on television, all of that is restricted because of the recognition of the great arm and the social consequences that the tobacco industry in getting people to use this product, what it has on our society. And so I think -- I think it's important, we passed seat belt requirements, we passed seats that children have to be in, in a car, our government does take action to protect the public good. And this is just another example of that. And California leads the way in being concerned about health and trying to work towards fighting back against tobacco companies and other kinds of things that affect our health. San José is the leader in California. I'm proud that we take positions that advance that, advance our health. I would strongly

! 9! suggest that we move forward on this. I haven't heard the City Attorney particularly warning us not to pass this in terms of legal risk. I mean I think there's probably some legal risk but we haven't seen that really affecting other cities that have adopted this. So I would support moving forward on this.

>> Mayor Liccardo: Rick.

>> City Attorney Doyle: There are scores of cities adopted it, there have been not one challenge to any of the cities in California or anywhere else that I'm aware of. This -- what it prohibits is nonsale distribution, which prohibits giving a tobacco coupon, costs are nominal costs to any person so it's very limited. And again it's modeled after what's been adopted in other cities.

>> Councilmember Herrera: And I'd like to make a motion to approve this.

>> Councilmember Carrasco: Second.

>> Mayor Liccardo: Okay there's a motion and second. Be Councilmember Kalra.

>> Councilmember Kalra: Thank you, mayor. It's kind of mind boggling we're spending so much time in the City of San José, protecting our youth, yes 18 to 24 do have the highest rates of smoking of any age group where we seem to have such a grave concern to allow tobacco companies to be able to market aggressively to our youth. Clearly they're targeting bars, they target gay bars more than any with about a quarter of the bars they target and we know the LGBT community has a high rate of smoking. And so that's why there's a greater sense of concern within the LGBT community but we all should be concerned about this. They are doing this because it works, how tobacco companies can advertise and market their deathly products. They are willing to lie, to fake studies, to hide studies and that's to protect all of us, children and adults. Around as others have mentioned, we have plenty of rules that regulate use of tobacco products for adults, children, anyone. I certainly don't think they're going to want to go back on those laws that protect people. I agree, yes, consenting adults, this is not about consenting adults doing what they want, but about corporations being able to access all residents in situations in which they know they're most vulnerable and that's why they want to do this. They're not just handing out coupons. They have constantily clad men and women that go into these establishments that have trinkets and all sorts of tree give aways and they give coupon and encourage them to use it. So if we're going to -- I'm glad that Councilmember Khamis believes in consenting adults doing what they wish, that's why I'm in favor of marriage equality and pro-choice and these great social issues, we do need to be respectful of consenting adults ability to do what they want. They can still buy a cigarette if they choose to but California has one of the lowest smoke rates for a reason. Because we've gotten aggressive over the decades on laws and marketing as well. This continues in I think a positive trend.

! 10! We are not leading, 45 other communities have done it, we are simply joining the very loud chorus of other cities, finally, downtown is really coming along nicely. I think there is one thing we just don't need in our bars to help our establishments continue to thrive. And I certainly think it doesn't add to our downtown or any of our establishments throughout this city so I certainly urge my colleagues to support the motion on the table and as to legal risk we can be sued for anything but there's very legal risk that's going forward on this.

>> Mayor Liccardo: All right. Before we go back in for a second round of comments, I just want to point out we have many members of the public who would like to speak on this item. I'd also point out I had opposed this moving forward ahead of the prioritization process. I thought it was important to identify what our priorities are in this city. I certainly am not opposed to it. I'm not certain it's going to actually accomplish much but certainly regulation of health is something that's within the purview of the city and the county. And we do it frequently. I do however believe that in the future I hope as a council we're going to hold to the idea that we are going to prioritize our highest most urgent priorities because there are items on the prioritization list right now, rent control among others, that we're spending time now, we are not considering those items either. A couple more members want to speak. Councilmember Khamis.

>> Councilmember Khamis: I want to address some of the items my colleagues have brought up. Number 1, I know this was brought by the public and some members of the public do feel that members of the gay lesbian community are being targeted. I respect the right of their doing what they want, they are at a bar. They are not at a video game place, they are not at you know a grocery store. And item frankly there's plenty of advertising, who last not seen the most interesting man in the world, who has not seen the beautifully constantily clad women on most beer commercials? I mean, there's tons of marketing and my children see it every day. And so it's up to our parents, to determine how much, you know, what kids can see and whatnot. But again we're not talking about parents. We're thought talking about youth. We're talking about 21 years or older. And we're talking about the rights of the -- the constitutional roots of corporations to advertise. I understand that 45 cities have passioned this. But if it becomes a much larger trend they might decide to do something about it. I don't know. And the fact that I don't want to have the city opened up for lawsuits, especially when really, it doesn't help much of anybody. Most people decide by age 21 whether they're going to become smokers or not. Quite frankly, I tried my first cigarette at 16. I didn't wait until I was able to get into a bar legally. So I wanted to make sure that I am not for smoking. I have never talked to a smoking lobby, I have never accepted a single dollar from a -- it's not about the conglomerates who do business like this. But there's plenty of -- there's plenty of advertising that is much more egregious, and the fact that people are in a bar, drinking something that as soon as they get out of that bar, they could get into a car accident, is more important to me than picking a coupon and throwing it away or deciding whether or not to try a new pack

! 11! of whatever it is that they're offering. It's about getting out of people's lives and I don't want government in your life. I don't want government in gay and lesbian lives determining what they should do. And that's key. I want government to butt out of our lives. And again, I can't not support the underlying motion. I'd like to do a substitute motion to deny this ordinance.

>> Mayor Liccardo: All right, there's a substitute motion to deny. Is there a second?

>> Councilmember Oliverio: For the purpose of debate.

>> Mayor Liccardo: There's a second to the motion. Councilmember Nguyen.

>> Councilmember Nguyen: Thank you, Mr. City Attorney, the language of your memo, additionally the proposed ordinance would extend the sampling prohibition to anyplace in the city. Is that not any bars right?

>> City Attorney Doyle: That's right, bars, restaurants, stadiums, be beyond what state law allows.

>> Councilmember Nguyen: I have a question to you. If we disagree that if we were to decide for the sake of the community that we proposed a law to ban all smoking, would that be facing a legal challenge very soon?

>> City Attorney Doyle: Not in public places. And we do have bans in public buildings and various other public venues. We have limitations as to areas, you know, certain foot requirements, 25 feet from buildings. So we do have that already. There are a number of -- we have regulated have cigarettes primarily over the last few years. We added e-cigarettes a couple of years ago, this is sort of another step.

>> Councilmember Nguyen: This is the way that -- we do not ban completely, we limited to some places?

>> City Attorney Doyle: Yes.

>> Councilmember Nguyen: I see your point, I appreciate it.

>> Mayor Liccardo: Okay. We have -- unless there are others that would like to speak? Vice Mayor Herrera.

! 12! >> Councilmember Herrera: Just that I remember when smoking was allowed in bars and it's not anymore. People drink they often smoke but drinkers constant be smoking in bars because it's outlawed. We have a tradition in this city as well as the whole country in moving forward to regulate tobacco. It's all been said before but I don't support the substitute motion.

>> Mayor Liccardo: We have many members who would like to speak. Come down to the front as I call your name. You have two midges to speak at the microphone. I'll ask others to come on down to save some time. Carol Baker, followed by Donovan Seymour and Brad Davis.

>> Hi, I'm a resident of district 1, I'm a grad student. I had to leave school to be here, so this is very important to me. I had grandparents who smoked heavily. I saw their health deteriorate. And my friends in high school became smokers, they have become heavy smokers over time. It's not hard to become a heavy smoker. A smart incentive like a coupon would definitely push someone along that road so I think that it's very important for us to oppose this because if tobacco companies didn't think that this works, then why would they do this? So theats why we need to put in an effort to stop it. And the butt out of our bars campaign funding is ending soon which is why this is really urgent and it's an important issue for us and we have to finish this now so I urge you to support this.

>> Mayor Liccardo: All right, Carol Baker.

>> Good afternoon, my name is Carol Baker, I'm co-chair of the tobacco free coalition of is Santa Clara County and ambassador of the American cancer society cancer action network. I'm urging you to start this ordinance as soon as possible, flex week if you can. Because the fund about this ordinance runds out at the end of June. If the law is finalized within a week or two at the very most, funds will be there to partner with the city to ensure that the bar owners and staff are aware of the law. If the law is finalized next Tuesday a nearly full page advertisement will run in the special metro Silicon Valley newspapers bars, printon June 10th. This is the largest issue of every year and the one we understand will reach a lot of customers. Why do you think the tobacco companies have targeted the City of San José, especially the downtown area? It's because it's a fun place, happening place and they want to connect cigarettes with fun. I can tell you this. It is not any fun at all to watch a loved one weighing 93 pounds trying to breathe, not able to breathe because their lungs have quit on them. Please pass this ordinance. I appreciate your letting me speak. Thank you.

>> Mayor Liccardo: Thank you, Donna Seymour, followed by Brian Davis.

>> I'm Donovan Seymour, I'm your neighbor, live right next door. Thank you very much, mayor and council. As some of you mentioned, Santa Clara County health department survey in 2013 found LGBT

! 13! people smoke three times more than the general population. So it's no wonder how tobacco, big tobacco has targeted the LGBT population. So they are using essentially tobacco to get into the community, because of its smoking rate. And they're using popular safe replies. I call bar safe places for LGBT community because it's a place they can go for freedom, the place they can get away from say they are not out, they struggle in life, it is something that they need help with. And it's simply that big tobacco is taking advantage of these people. My experience is I went into a bar in Downtown San José, I found that there is a guy who went around he had a mention engineer bag, he was signing people up essentially for these coupons and I find this sad. It is sad that they are taking advantage of our community and it's not right. To wrap this up I would like to ask you a simple question. Isn't the health and well-being of not only the LGBT community but the well-being of all the residents and visitors of San José more important than a profit of big tobacco? I sincerely hope that in the innovative and progressive place that it is. Please approve the ordinance for amendment of title 9. Thank you.

>> Mayor Liccardo: Thank you. Mr. Davis.

>> Good afternoon Mr. Mayor, members of the council. Being tobacco is the number one preventible cause of death in this country. Every year in the U.S. tobacco cims more people than aids, alcohol, illegal drugs, suicide murder, and all the soldiers that died in World War II combined. When anyone hangs out to meet someone new, we don't want them offered a coupon for $1 off cigarettes, tonight only, can be taken just a few feet away to the bar in exchange for cigarettes. A coupon that lowers the blood alcohol to almost nothing Young people up to age 25 are much more likely to smoke if prices are lower. A coupon much more likely to smoke when higher -- no lower, got it right the first time. A product as addictive as heroin and much more deadly. On the issue of court cases, yes, 45 cities and counties in California have laws like this and the vast majority of them they do carry all of these other areas of the city.no lawsuits have been brought against any of these cities or counties. Where there have been lawsuits at the federal and state level, what has been decided by the courts in both cases they ruled against big tobacco. What they said, the court said was that the big tobacco companies have a ride to educate to talk to the public, but cities and counties and communities have be the right to pass laws to help the community by restricting tobacco. Thank you.

>> Mayor Liccardo: Mr. Ferrar.

>> It's the worse of two evils by allowing the aggressive policies of big tobacco to come out to bars surreptitiously, getting people at a moment of weakness and saying oh, you ought to try there and they just grab onto it and the idea that afternoon ordinance like this would help mitigate issues where we have end-of-life issues that we're all dealing with with our families. As I've told you when I last spoke I lost all my family members, because of smoke. I'm one of the family members, who haven't smoked, my

! 14! father pushed one in my mouth, when I was curious, my mother showed me how to smoke it, for the next ten minutes I turned green and coughed my head off. It was really quick for me to realize I didn't get myself involved. 21-year-olds who haven't goes their minds fully developed, if government is what it takes I'm all for that and I ask for your support. Thank you for your time.

>> Mayor Liccardo: Thank you sir. Following Jim Measure 70 will be Ray Perez, Devon Wakefield, Gabrielle antolovich. Ray Brown.

>> Good afternoon, almost, I'm a alleviate ambassador and I'm here to request your support of the but out of -- I'm a legislative ambassador and I'm here to request your support of the butt out of bars ordinance. Causative risk factors not only include tobacco request alcohol together create a much higher probability or percentage of risk of acquiring cancer. The fact of the matter is this is a leading issue in terms of cause and we very much would like to see San José come in line with the rest of California so today we ask for your support, thank you.

>> Mayor Liccardo: Thank you, Mr. Perez, Ray Perez, if not Devon, go ahead and while Ray is coming down he can come next. If you could line up with the others Ray that would be great. Thank you.

>> Good afternoon, councilmembers. You've all heard me talk before. My name is Devon Wakefield, I'm gay, I have a genetic condition known as cystic fibrosis. This bill will show that San José cares for its population. Multifaceted problem as Councilmember Khamis noted. It does help address one issue and that's very complicated problem. It will reduce the availability of cigarettes to a community that already has a lot to zeal with. Please help simplify our lives, please help make San José healthier. The butt out of our town coalition only has so much time left. We fled refunding by the end of June, and with that we hope to educate bar owners and staff. We'll do our part if you do yours. Thank you very much, have a good day.

>> Mayor Liccardo: Thank you, Mr. Perez.

>> Good afternoon, Mr. Mayor, Vice Mayor, councilmembers. 53 years of smoking when I was 14, 15 years. Smoking like everything else is not healthy. Have but when I became a father, I made a promise myself to quit. It took me quite a while, I think for 12 years. I only went back later, back and forth. But the little thing is not what I did. It's what I was, and to all this time, is parenting is very important. Don't let them watch what you're smoking in front of you. And also, the liquor. But also very important, is a corporations less with tobacco. Tobacco is very I would say is comfortable for many people because when it releases stress because many people who smoke it is because it's under stress. Wee release water, if we want to release a little bit of the smoking habit, personally I do. Like I say, smoking is is a

! 15! prevention against the children in elementary school, middle school and high school. That's what I want to say.

>> Mayor Liccardo: Thank you sir. Ms. Antolovich.

>> Hello, I'm Gabrielle antolovich, the new president of the Billy de Frank LGBT community center. This really affects us a lot because the LGBTQ community really does smoke more they come to our center and often are unaware of the fact they can't smoke near doors and windows. And I have to say I'm really appreciative that we have this ordinance that you can't do that. So I made sure that we got the signs and I can in a friendly way say you can't smoke near here. Because the city has you know passed this ordinance, so that it keeps other people safe. And that's how I see this ordinance too. I don't see it as government interfering in people's lives, I see it as a help for leaders like ourselves, to talk to bar owners which of course I know, the city supports this, work with us. Because let's face it, the brain doesn't fully develop until you're 25. That means 21-year-olds are still vulnerable to any kind of substance use. The tobacco industry understand he this, they are not targeting renegades where the older gay men go. So they do want the young people. And trust me they want all of us young or old, except me, I'm old.

>> Mayor Liccardo: Thank you, Ms. Antol offeringsvich.

>> Mayor Liccardo: (saying names).

>> Good afternoon, thank you for listening to us today. My name is Patricia Brown and I want to tell you I lost my late husband just prior to our 30th wedding anniversary. At the time we had three young grandchildren. One was almost two. One was seven. And one was nine. He never got to see those grandchildren grow up to become the young men they are today. They're 28 now, 25 and 21. The oldest, he watched his grand father suffer. He remembers him gasping for breath. He will not touch a cigarette or any type of tobacco. Unfortunately, the two younger ones barely remember their grandfather at all. Unfortunately at the age of 16, the middle grandson started smoking Hooka. The youngest grandson at age 20 started with e-cigarettes because he believed that would keep him from ever smoking. Today they both smoke over two packs a day. Now I've heard a lot today about how we don't want government in our business. And that's probably true. But I also don't want tobacco companies and all their money pushing cigarette products on our youth. Getting them looked to things that mean a long, miserable death. We need to put this in place, and we need to put this in place as quickly as possible so we can partner with the city. We can do the education and the training that we need to do. So thank you very much.

! 16! >> Mayor Liccardo: Thank you ma'am. Mr. Wall.

>> Thank you Your Honor. I think maybe there should be a friendly amendment from the floor to include not just tobacco products sampling but marijuana products sampling. Councilmember Kalra can you imagine your kids seeing a coupon with the picture of the lord Jesus doing a bong-hit? That might persuade them to doing purple haze. I don't want to dissuade from the conversation, we all know tobacco kills. But with your comment with respect to the run away aspect of the medical marijuana places, if you are suffering from cancer and marijuana might help you out, quite the antithesis, these young people going in there saying I got a sore spot on my rump, I got to get a cannabis card so I can get a reefer. I see the calm before the storm because big tobacco is going to be surpassed by big marijuana. I'd like to compliment you Mr. Mayor, Mayor Reed opened the door for them, and some of you sat by your sidelines, not exercising your fiduciary due care, concerning the evils of tobacco. Of course I grew up it was the evils of marijuana that would make you turn into a horse or something if you smoked it. And now it's open game in San José for even little kids. Little kids, 16-year-old kids or 17- year-olds. Going in there and getting all the marijuana they want. But thank you, Mr. Mayor, you have done a good job on this.

>> Mayor Liccardo: Mr. Cartwright, followed by reverend Moore. Followed by Ross Signorino.

>> That's a hard act to follow. I smoked for 31 years and I quit five, six years ago. But I'm not here to say that like tobacco is bad or anything like that. But I do think that what helps me become a smoker for a long long time, particularly as a teenager was, there were many places that you could go to and they handed out free cigarettes. There was a lot of clubs. I grew up on the sunset strip. Maybe when I shouldn't have been there but hey, I was tall. And so you could go to these clubs and they handed out free cigarettes all the time or you could get them from your friends who went to the clubs. I became a smoker for 31 years, go ahead try to do the math. It's going to happen to the kids now, or to people who are younger, it's the same thing. I'm kind of like a little bit of a worst case scenario, I get a cold and next day it's pneumonia and breathing treatments in the ER, that's.what happens. Going back to the whole maybe you guys should do bong hits, I'm sorry Councilmember Khamis is not here, the twists and turns he puts himself through, maybe it's the bong hits, he gets really stressed doing that. Earlier we were at, last week Councilmember Kalra brought up citizens United, and right now, it seems really appropriate because it seems like the underlying argument so that some of you are really doing trying to fight this so incredibly unnecessarily and ridiculously, is needing campaign contributions so that seems to be it might be behind this. I hope you guys do when citizens United comes before you that you support Councilmember Kalra's actions and you work to overturn that because really seems like maybe campaign contribution he are behind these ridiculous arguments, try bong hits.

! 17! >> Mayor Liccardo: Reverend Moore.

>> Good afternoon, councilmembers. I just would like to first say, just last week, we have my brother's keeper program, you all for, look out to the best interest, people returning to our society. Yet we are today trying to debate how we are going to take care of their health and allow e-cigarettes in. Also later be on this afternoon, we'll be celebrating the raising of the LGBT flag, you are saying you support them, if you truly support these efforts and these things you would not allow e-cigarettes, the greatest allow to these e-cigarettes will to be to my high school students this summer, how under my brother's keeper program will you keep these e-cigarettes off of our campuses? And how will you keep the schools from suspending or expelling them. You need to stand up please stand up for these communities that you said you wanted to protect. For these communities that you said you wanted to work with, and for the community that you are saying I support you I love you I'm allowing you to be here but on the next hand you let them have the cigarettes come in. These types of cigarettes with menthol is the most addictive form it has. This menthol is directed at people so they will be addicted for the rest of their lives. Stop the poison. This menthol is directed at African American youth, this menthol is directed to young gay people, getting them addicted for the rest of their lives. The city has time to take care of people with cancer, it's miserable, it's time to have somebody step up and say, enough of this, stop them from going to the bars, stop them from going to the bars.

>> Mayor Liccardo: Thank you, Mr. Signorino.

>> I'm here to say one thing not in criticism, but total respect for Mr. Khamis. When he says he wants government to butt out of our lives. I wish Mr. Khamis who is an American citizen to understand the processes of our government. Without government I just don't know where we would be. I wish Mr. Khamis would specify what he means when he says, I want government to butt out of our lives. I know you mean well, maybe you put it in such a way, that's how I take it. How can that be? Thank you for your comments, I hope you take this to your heart, I have no offense meant to you in any way, I have a great deal of respect for you. See you later, thank you.

>> Mayor Liccardo: Thank you, Mr. Signorino, any other members of the public to speak? We're not yet done with our consent agenda. There is a motion from Councilmember Khamis I believe. To deny this motion. We'll vote verbally on this. Unless there's anyone who would like to speak. Councilmember Khamis.

>> Councilmember Khamis: Yes, so just -- I heard a lot of vigorous testimony from the audience. I do care about high school kids. These coupons will not be distributed in high schools. They are not in the high schools hand being out cue pongs. If they were, I'd be one of the council voting against them. I

! 18! have kids at home I don't want to smoke. I have two kids. I'm death against them trying marijuana. On the streets of Santa Clara, believe me if I could do more I would. But we do have ordinances that limit where you can smoke already. We have ordinances you can't buy cigarettes in bars, you have to go outside the bar to buy them. You cannot smoke within 25 feet of any building. You can't smoke in any public places including parks. I agree with all of that because it could cause harm to other people. What I don't agree with is when a government tries to weighs in to moral issues. If I'm going to take a coupon and use it for whatever happens to be, alcohol, cheese, you know, McDonald's sandwiches, some people may disagree that I like to eat McDonald's food, I don't want government interfering in that, that's where I'm coming from. And so when I come from a -- I come from a position saying, get government -- get government out of our personal lives, okay? Out of the decisions that we make every day. That's where I'm coming from. I just wanted the audience to know, I agree with the end results that you guys are trying to advocate for, I really do because I do feel, I do feel that it is a danger to kids. I just believe that people who turn 21 have a right to do whatever they want to do with their bodies and wherever they decide to spend their money and whether it's in a bar or buying a cigarette or buying alcohol or marijuana, for that matter, that is a choice that they're making as an adult and that's where I'm coming from. If it was an ordinance targeting children, then I would be on your side. I just -- I just -- you have to understand that I just believe people who are 21 have a right to make their own decisions and that's where my decision bases came from. So thank you all for coming to participate today.

>> Mayor Liccardo: Okay. Also like to thank all the members of the public who came to offer their testimony. We have a motion on the floor. Councilmember Khamis. All in favor say aye. All nos say no. Okay. That motion -- is there --

>> The Clerk: Can you keep your hands up so I can write down the nos.

>> Mayor Liccardo: So that motion fails 2-9. There's an underlying motion by Vice Mayor Herrera. All in favor? Vote aye. All opposed, say no. Okay, there are two nos that's 9 to 2.

>> The Clerk: Who's the second no.

>> Councilmember Oliverio: That would be Councilmember Oliverio being consistent with the prior vote, I would spare the audience the entire argument I made last time. Thank you.

>> Mayor Liccardo: We're all grateful. All right. We are now done with the consent calendar. The wheels of progress. On to 3.1, report of the City Manager.

>> Norberto Duenas: Player and council, in light of the time, I will hold on until next week.

! 19!

>> Mayor Liccardo: Moving right along, 4.1, progression report on homeless housing initiatives. Jacky and Ray are joining us.

>> Jacky Morales-Ferrand: Good afternoon, councilmembers, I'm Jacky Morales-Ferrand, the interim housing director and Ray bramson. The first piece of the memo really tried to outline some of the challenges that the department faces in producing affordable housing to house homeless individuals. 90% of our funding is very specific what we can use it and the part that can be used for permanent supportive housing or affordable housing, long term we'll be challenged in finding more funds in order to support our be initiative pickup we have very limited or no funding available for some of the shorter pilot programs that are discussed in the memo. So while we have identified funding for the park program we are challenged in finding funding for transitional communities. Location, location, location, is critical when we're trying to site affordable housing. We would like it near transit and services but community support in order to site the development and the pilot programs. We often hear no instead of yes. We need to hear more yeses in actually implementing these ideas. Capacity, we have a very small staff. Ray has four people who work on the homeless team and we have a small development team. Developers while we have award winning developers who have produced phenomenal affordable housing they don't have as much experience with be 100% are supportive housing. And we have wonderful nonprofits who provide supportive services but we really need to implement a system that coordinates their services and makes our developers comfortable with the expectations and standards that they will be receiving for supportive services. For access, one of our strategies to fund coupons. And through the General Fund and through our home program and this does require a willing landlord to accept the vouchers or the coupons. And with the vacancy rate of 3.3% and long waiting lists in our affordable housing, again we're very challenged in terms of getting people housed quickly and we still have people who have our coupons who are searching desperately for housing. And lastly, time. We understand and we acknowledge that it's been frustrating that we haven't been able to develop supportive housing very quickly. It takes a developer time to find a site to work with the neighborhood to develop a financing plan and to complete and design and to go through our permitting and the actual construction. And for pilot programs it takes time because these are new and innovative ideas and our partners sometimes aren't prepared to implement them and we're not prepared to take them through process. Anden so that is taking us time to get up to speed. But we do have some opportunities in the upcoming years. Road map for us in terms of implementing affordable housing for homeless people and families. We're finding increased coordination and cooperation between the city, the county and the housing authority. I really do want to acknowledge our partnership with the county and the housing authority. We've made great strides. We need each one of those people to actually -- or entities in order to create supportive housing to be successful. The housing authority has just announced that it's going to be releasing a thousand project based vouchers of which they are committing 300 to be used

! 20! for supportive housing. That's a huge step for us because that will help us leverage our funding. We are working with the county and destination home who's been a great partner in helping us to convene key stakeholders in developing training and technical support to both our development community and support services partners so we can be successful in implementing our housing plans. We are looking at maximizing the city portfolio which includes 17,000 affordable units and ownership $600 million in loans that we have invested in our affordable housing and our ability to actually maximize the loan payments will help us to continue to fund affordable housing in the future until a longer term funding source can be identified. And then what we're looking at funding for the next year are 778 housing opportunities, of which 408 will be supportive housing for chronically homeless people, 200 housing coupons which are funded through home and the General Fund that will be used to help people who just need short term housing assistance. Because again we know there's a tremendous need now in our community to house people today. We are looking at piloting 170 traditional housing hotel-motel, safe parking and transitional communities. That's our work plan for the next year which we believe will give us significant steps in terms of moving forward to address this issue. And with that I'll open it up to questions.

>> Mayor Liccardo: Thank you, Jacky, thanks oyou and ray and your entire team. I know you've been working very hard with a very small staff to try to accomplish great things and we know we need great things because it's a very big challenge we've got ahead. I had a few questions based on what we saw in the report. Start in first with the motel conversions. I've been told on a couple occasions that there's an issue with permitting with the city with the motels. And I just want to understand if it's an issue we can fix then we can fix that. Is there something that can be brought back to council so that we can look at it and say, we either want to go forward or not? And if so, why wouldn't that happen?

>> Ray Bramson, supportive housing manager. Title 20 which limits it to 49% of the master-leased units.

>> Mayor Liccardo: Right.

>> I do think this causes some challenge but even if we had, we could lease 100% of the units we have a very, very small stock of these hotel-motels that we have been able to identify. We have been able to direct abode services to study this, conversion or acquisition would make sense we're betting all of this but we want to get a sense of the stock.

>> Mayor Liccardo: We're not precluding the possibility of actually purchase being the motel?

>> No we're not. We're considering that as well.

! 21!

>> Mayor Liccardo: We know that rents are incredibly high and $2200 a month it just doesn't make a lot of sense for us. And a lot of these motels are very marginal. And at present value their future stream of revenues, whatever valuation you use I'm guessing you buy the motel for cheaper than it would cost for a long term lease. And we would obviously love to have the asset for housing. As we look at the challenges with the TBRA, recognizing the big gaps between the market rate of rents and the HUD rate, do we have the freedom, if this council decides we want to spend money, helping to close that gap between the -- I guess the question is, do the HUD restrictions apply if we use local money to supplement the rent that's paid with the vouchers?

>> Jacky Morales-Ferrand: So we have two sources for the TBA program. We are not restricted with how much we can pay for that. We can start inching up the rents to see if we can get people housed more quickly. The more we pay for rent the less likely that the client is going to be able to remain in the house and we ohave to transition them again. While there is some flexibility and we are going to HUD to increase those in the short term, we're really grappling with the issue long term does that make sense if the person constant transition in place. So short term yes we'll couldn't to look at inching those up but long term we really need to figure out how we get people into lower cost housing.

>> Mayor Liccardo: Okay. I know that as we've grappled with the big gaps between the voucher value and market rents, we've been looking a lot it showed housing and have we had any success at this point in matching up multiple vouchers and getting them into multiple units?

>> Jacky Morales-Ferrand: Abode has been shared housing homes. So certainly they have been looking at putting people into shared places. And the case managers also look at it. That's the only place that somebody can afford then because our coupons, the city-funded ones are flexible. Putting someone in shared housing is an option as well.

>> Mayor Liccardo: So have -- I'm sorry forgive me Jacky --

>> We do have clients in shared housing. We are looking at any options possible. More than likely as Jacky mentioned, we would like to have transition in place for individuals finding 30% AMI, but once our coupon graduates, graduate from at a and live on their own economically independent in that unit.

>> Mayor Liccardo: Okay, great. And then with regard to the veterans bond, that passed last year I know we were all hopeful that there would be some funding so we could house homeless vets here in San José. And I was troubled to read that looks like we don't have a project that's like to be

! 22! comparative. Like second street, what are the problems, is it because of our higher average incomes in the area, because of the values of property, why aren't we able to be competitive in that grant process?

>> Jacky Morales-Ferrand: It was because of the way the grant was structured in the first round, it was really structured in the first round to before programs that had vouchers. Our development didn't score high enough because they didn't have those commitments. It could be in subsequent rounds we would be competitive, if we were able to -- either they change how they score after this first round or were able to obtain Vash vouchers for our development.

>> Mayor Liccardo: That is a decision made locally by the VA regional office or the allocation of Vash vouchers.

>> Jacky Morales-Ferrand: I think the organization is here.

>> Katherine Harris, I'm deputy executive director for the housing authority. We actually included VAsh vouchers in the last go round and didn't get many takers. We intend to include them in the fall with the thousand effort that project based voucher effort that your director of housing indicated. We have to do a solicitation and the VA has to approve signing a letter saying we approve of this. We can do it.

>> Mayor Liccardo: Just to understand, we are interacting with nonprofit developers, they need to reach out to you the housing authority, is that right?

>> Yes, we are going to have a solicitation effort. They can include in their proposals the VAsh vouchers. I think that may have been one of the barriers for the last round having the VA more actively involved.

>> Mayor Liccardo: I'd like to be involved, I know supervisor Cortese would like to also. What we thought was a significant commitment by the Veterans Administration to do something proactively. We have not yet seen the response and all of us together would love to push for that so please reach out to us.

>> We just got an award of 113 more VAsh vouchers. HUD is monitoring it very closely. We are having a monthly call with the VA on the issue.

>> Mayor Liccardo: And can you fast-track those vouchers?

>> Yes, we can, with the VA's permission.

! 23!

>> Mayor Liccardo: Thank you. There's a reference to inclusionary fees that were paid $7 million and I'm trying to understand, you know, we've been in litigation with inclusionary ordinance for many years now. We don't yet have a blessing from the California Supreme Court, we hope we will soon. Is that $7 million anticipatory?

>> Jacky Morales-Ferrand: They already had signed agreements that required they pay the fees. Once the requirements were moving forward which they did, the fees were paid.

>> Mayor Liccardo: Okay, these are back in the old days from redevelopment or recent projects in RDA projects areas?

>> Jacky Morales-Ferrand: They were projects RDA areas. We are still implementing the ordinance in the RDA areas.

>> City Attorney Doyle: That ordinance is still in effect.

>> Jacky Morales-Ferrand: For rental it is not allowed, for ownership we are moving forward enforcing that.

>> Mayor Liccardo: That's a very small universe of housing. Understood. Thank you for all my quis. Thank you, Councilmember Peralez.

>> Councilmember Peralez: I'm really impressed by the comprehensiveness of the report. The previous report did not do it justice. I appreciate getting that ahead of time as well. It's clear this is our foremost issue that we're dealing with in the city, as you know in your office I've been very appreciative of the work that my office and yours have been doing together. The problem is literally at our door step which I welcome it is here because it brings it loud and clear that we have something here that we must work on diligently Day Desai, there is approximately 3700 homeless individuals in our city and, 778 housing opportunities, so nearly enough for what the need is in our city -- so not nearly enough of what the need is to. Our city. I hope we continue to work together to find what the solution is. In the downtown core knowing we have the most encampments throughout the city and more than likely the Moss population of homeless individuals I'm committed to taking ownership of that here in my district and working with those involved and I'm hoping that my colleagues as well are interested in taking ownership, and being able to do something as well in their district. I did have a few questions and I think we might have been able to give you a heads up beforehand. But and this is in line with the motel-hotel conversion the mayor had brought up as well. We have I believe abode services looking at these

! 24! conversions. Can you let me know when that research, will that be available as far as the rehabilitates of some of the sites, identification of them, when will that be available and what are we going to do once that information is there?

>> Jacky Morales-Ferrand: Sure, they are actively looking now. And so I think we said something in the next couple of months we would have a full report back from them. But we are anticipating submitting a request to look at a current moment in the downtown and hopefully we'll be submitting that this month.

>> Councilmember Peralez: Okay, so maybe before the July break then we can --

>> Jacky Morales-Ferrand: Correct, at least for one.

>> Councilmember Peralez: Okay I appreciate that. And then one of the challenges you mentioned on page 7 of the report was the vacancy rate. Obviously we know the supply and demand, huge issue here, 3.3%. I think that you know, that's a horrible trend to have. It's good I guess if you are a landlord but what we're trying to have if you're a tenant, it really allows, and I think what we've seen is the landlords to be discriminatory in regards to who it is that they can -- that they rent to. And I know I had proposed this and this came in April. If we did adopt a source of income antidiscrimination policy how do you think the that would impact our situation and would our existing rental rights and referral program have the capacity to support this or these cases and if not would we need some additional resources?

>> Jacky Morales-Ferrand: So the city attorney's office has notified me that there is state law that does prohibit income discrimination. However, it doesn't require that somebody accept coupons and vouchers from the city. So nobody, a landlord isn't required to sign a contract for a voucher program. And so that would be the challenge there, is that there isn't any existing law that requires a landlord to accept vouchers. So we haven't looked at that issue. That is something we would need to explore to see if that's allowed.

>> City Attorney Doyle: Councilmember, some information that there are four cities in the state that do have such a prohibition. So I think this is something we need to work with staff to get back to council on. We.have not looked at those ordinances but I know Los Angeles, San Francisco, I believe Santa Monica and East Palo Alto have something in place and we'd like to take a look at it.

>> Councilmember Peralez: I know the mayor pointed out the butt out of our bars issue, it's significant, this is definitely a priority of mine, I think of our entire city. The second part of the question was, do you

! 25! think considering say we could include that with the discrimination vouchers, do you think that could be supported by our hotel motel program?

>> Jacky Morales-Ferrand: It could not be supported, the current staff is already maxed out in the amount of work they Dom any time we rework an ordinance we would come back with an assessment of the staffing level. I'm not guessing but I an hoping we could come back with that.

>> Councilmember Peralez: We heard a lot of testimony in this regard when we came up in the Rules Committee. Given the concerns expressed by some landlords, in expanding rent control, and just cause ordinance, could you potentially speak to the realistic outcomes and I know you noted it in the record, that we might expect from engaging landlords with just education or maybe incentives? Do you think we would see a significant increase in our landlords participating or willing to you know participate in maybe even accepting housing vouchers or in a rent-control model?

>> Jacky Morales-Ferrand: Sure, destination home in partnership with the housing authority is looking at the question of how do we engage more landlords in accepting both coupons and the voucher program. And so there certainly have been initiatives across the country, working with landlords, to try to get them engaged an more supportive. Because oftentimes they don't understand the process so they have perceived concerns about why they wouldn't want to participate. But with additional information and knowledge, they are able to get more. Certainly it's challenging here because as you noted our vacancy rate at 3.3% means this there is a lot of competitiveness. But it is something that the housing authority and destination home is looking at and we expect to see a report this summer.

>> Councilmember Peralez: And do you know, is that at work, has one of the companies been working with tricounty apartment association?

>> Jacky Morales-Ferrand: My understanding is yes they have met with the association. I will let Katherine answer.

>> Thank you, with the community plan to end homelessness, the housing association has made a promise to find a home for our voucher-holders. I've immediate the various executive directors, we have been conducting landlord surveys. There is a certain bureaucracy that's associated with the voucher process that's absolutely a barrier. Perceptioned regarding the population we want to serve, to get the return on investment they will just have a wholesale policy that says we don't take section 8. That's just their policy, the investors don't question it. Their screening criteria is often a barrier. So we're working on a set of incentives in connection with Joshua Howard with the housing industry foundation. We want to look at some kind of landlord recognition program which is something we would certainly look to the

! 26! city to partner in. Other incentives such as offering representer's insurance, master leasing is another option. But I think really what we have come to in terms of just the sheer economics of residential rentals in this community is projects-facing vouchers is the most amenable option, it is in the distance but it's the way to ensures you have a landlord in the future.

>> Councilmember Peralez: I heard too foo of laltsdz that maybe were already incorporating to rent, feel safe to rent to section 8 voucher holders or he weren't so apt to raise their rents year after year. There were few of those voices. So I don't know how much engagement or education we pay be able to do but I did -- there was certainly a number of landlords that were here to present and the tricounties could be the way we could get more participation.

>> We're reaching out now, our group will go for the focused of smaller mom and pops we call them, to engage information and streamline our process. We're taking that information in and seeing if there's any way to streamline our process. There is always a balance between what will make the landlords happy and what will make the tenants happy. The manager is in the position of having to walk that very fine line.

>> Councilmember Peralez: Thank you for your work. Thought you had a question for me. One of the things that was alarming was on page 17 of the report and this was on -- under the homeless prevention program. Excuse me, in there. The 30, 60, 90 day notices has doubled from a low of 162 to 325 and then you're saying here housing department has received 345 notices with three months left of the fiscal year and this year will exceed last year's total. That's certainly alarming. I don't think it's the path we want to head. Arguments against implementing the stronger just cause policy could be rated on racism or classism, and those two pieces of really facts and data highlight that. That it doesn't seem, I would beg to make the argument that we vice president hb that many of increase of individuals warrant an eviction as to a reason you might argue against just cause. Because the individual is the criminal or doing drugs. I really beg to differ, and extra 150 individuals were doing such a thing that warranted an eviction. Seeing that increase in the economic we have right now and the rental market we have right now would lead me to the conclusion that this is our rental market and the ability to earn more on a parcel is there and certainly taking more advantage to it. A stronger just cause eviction, is something as I had broad up previously as well, that needs to be looked at. Those numbers are there and it's sad that it's going to continue to go up and as I said I find it hard to believe that those would be up for a valid reason. This is the biggest issue we have in our city with housing and homelessness. I know we have the process coming forward with regards to prioritizing our work. I urge my colleagues here that we make this a priority. This is -- you know it's not just about those on the street that are homeless, when we talk about those that are in rentals right now not homeless, when we talk about preventing homelessness and make sure these people can stay housed, that can continue to afford their property

! 27! or their apartment and that they don't get evicted for wrong reasons. I know that Jacky you have already started some preliminary research on some of the tenant protections. And again this may be you know off the top of your head here but given the daunting workload you have, we have the mobile home conversion ordinance up, would six months allow enough time to research the impact and effectiveness of our current rental dispute mediation and arbitration ordinance and be able to report back to council on your findings?

>> Jacky Morales-Ferrand: Yes. The department had already identified the rental ordinance, the rental dispute mediation arbitration ordinance as one of the work items under the housing element it had been identified and so we have been making staff changes in order to accommodate a study.

>> Councilmember Peralez: Okay so six months would allow enough time for that?

>> Jacky Morales-Ferrand: Yes, it would.

>> Councilmember Peralez: Appreciate that, thank you. And I am excited about the last item I will speak to which is our fully supported housing project, housing impacts this is the project that had been completed successfully in the heart of San Diego their downtown, we're excited that we're looking at that we have had a number of downtown supporters and boosters, how homelessness is affecting them here in downtown and all of us really which is why again, I raise the point that I want to be able to take advantage of this project and have it be right here, in the heart of our downtown core and I hope to look to have supporters of that and allies. And I'm hoping as well that my colleagues will support these as we move forward and as well as looking at opportunities throughout the rest of the city. Thank you.

>> Mayor Liccardo: Councilmember Jones.

>> Councilmember Jones: Dealing or addressing the homeless issues, sometimes I feel like I've been playing whack-a-mole, where we clear up one homeless encampment and they move to another part of the city. The concept came to my notice, having an ordinary encampment that had rules, regulations, sanitary facilities, support services, because one of the challenges obviously is, if you have a dispersed homeless community, and you have caseworkers be assigned to individuals, they don't even have a way of contacting those individuals. I'd like to get your thoughts on having a well regulated organized coordinated encampment.

>> Thank you, councilmember. I think be we're in San José having one of the largest unsheltered homeless population in the U.S., it is clearly a problem, thousands of people sleeping in the streets, in our creek beds, in our waterways along our creek beds every night. We do discuss the concept of

! 28! looking at different types of transitional communities and it's a wide range, we've been working with the communities and the mayor's office, one is the regulatory environment and the laws, building code issues. Secondly we have the problems, the space and land, how can we find space where we can adequately serve a reasonable number of people to have impact often scope and then the funding as Jacky mentioned earlier. Our funds are restricted very tightly to specific items and housing development paying for ongoing services to support and sustain large communities that could be costly and time consuming. We are looking at everything from legislative fixes to pieces of land that we can use for traditional housing opportunities, to building the permanent supportive housing that is used to support them long term.

>> Councilmember Jones: Is that something you have the bandwidth to come back to us with, the barriers solutions some type of road pap in terms of how to make that happen and how it can be done?

>> Absolutely, councilmember. If you look under the transitional community section of the memo that will give a sense of what we're looking at now but we can come back with a much fuller report of how we can accomplish that in the next couple of months.

>> Councilmember Jones: Particularly I got an eye opener on reply side of the town, the west side, there are residents in $2 million homes that are using support services the for food and other items. Because they're house-rich and cash-poor. I imagine there are probably individuals like that throughout the city. And so it kind of shifted my way of viewing things in terms of a shortage of housing units to where there could potentially be a surplus of rooms. And what I mean by that is people who actually own homes, have plummet rooms are house-rich and cash-poor where we can potentially place you know -- I'm not talking about homeless that have mental issues or drug issues. But people who are in transitional homelessness, that we can find a place with them, and match them with people who need that income and would be able to provide them with shelter. That's something I just wanted to throw out because it came to my attention pretty recently. I think that might be a solution to at least part of the issues that we're having with people who are in traditional homelessness.

>> Jacky Morales-Ferrand: We layered during our budget hearings a desire for us to look at this category especially as it relates to seniors who you are exactly right, who own a home yet need more support as well in order to maintain and to remain in their house. And so we are putting thatten oour work plan to explore further.

>> Councilmember Jones: Great, thank you.

>> Mayor Liccardo: Councilmember Nguyen.

! 29!

>> Councilmember Nguyen: Thank you, mayor. I have some questions for staff. I think last week the county came out with a report. And it was astonishing. I don't know if I should believe it or not. It costs about $20 million a year for the homeless. My question to you, do you attend to agree with this or do you think it's an explain to those numbers?

>> Councilmember so the report you asked -- the cost study on homelessness which has a figure of $520 million per year.

>> Councilmember Nguyen: Right.

>> It is without question one of those comprehensive data sets that has been assembled in the United States looking at homelessness and there are 104,000 unique homeless participants in that study. The data is unquestionable and the costs are extensive. I don't -- we definitely are very appreciative of both destination home and the county for putting in the time and effort to reveal the results of this study. And it's only looking at county systems, keep in mind. It's not looking at any of the other systems that are paying into this study. So it's certainly expensive. And we saw that a group of persistently almost individually, about 2500, 2800 individuals are make up the majority of the cost. Over a six year period, cost the county $850,000 per year. Makes the clear argument that there is a way to get the city into a much better living environment.

>> Councilmember Nguyen: From our comprehensive reporter and this is is correct me if I'm wrong, but most of our city homeless are local, or are they dumped in from out of state or out of town?

>> The vast number of homeless in San José and Santa Clara County became homeless while living in this area. The 2000 homeless survey will be out later on this month and I brief the results will be similar.

>> Councilmember Nguyen: The next issue is, do we need more help in terms of, the issue is too big and it is overstressing our resource and staff. Do you think we may need a dedicated section of staff or persons who will be just focused on this including effort to seek for more help in terms of resources, county, state and federal level? Because apparently we are not scratching the surface of the resources that are necessary.

>> Jacky Morales-Ferrand: If we had an abundant amount of money that would be great. We did put in the last budget a request for an additional staff person in order to work specifically on the development process and to help us get our development funded and moved forward. And so we believe that will

! 30! really help and that's one of the reasons we'll be able to move forward on a 408 supportive apartments, because we have more resources to move those solutions forward.

>> Councilmember Nguyen: That's why I really appreciate the report. Each report is alarming, talk about reading it, I'm exhausted, to imagine how much tremendous impact it has on your staff. So therefore if you need any supportive staff I will support it. Because I think this matter like Councilmember Jones, this is like whack-a-mole. Like right now, look at the proposed solution up, five or 600 spaces, that's only 1-10th the actual population. Let me try to summarize, a global solution, but that may take a lock time. It takes a lot of effort, a lot of new resources and while we're getting there, it is going to take longer and people are still on the street. So for example, one of the things I appreciate, I like a lot, is the safe parking example, just one of the things, the options that we may consider, for the final solution, but looking through report we have only like 30 spaces, one of the options we should expafned more finding spaces that can -- one of the solutions, include the space for the safe parking program.

>> Councilmember, the safe parking program and the 30 vehicle spots you're referring to the hope is we'll be able to bring more people through than 30 individuals over the course of the year. Because we believe people living in vehicles have access to income, are higher functioning, may have the ability to possess a driver's license and may be more easily integrated into the income stream. We'll be cycling through. The 30 slots that we proposed is for two parking lots and siting is a challenge. We are producing an RFP, to make sure we have a provider that can service that initial capacity and getting people off the streets and into permanent housing then we can increase the program over time.

>> Councilmember Nguyen: I understand, that's why we refer to the last resort, I understand that, do you think in the future when you come back, you'll have a better report, a better opportunity to increase or you don't think that's a good option to put an effort into it?

>> We do believe that the program has a good deal of potential. We want a provider that can offer the services and then make sure we can locate the first two park lots that we can use. As additional parking lots come up we might be able to increase the program councilmember.

>> Councilmember Nguyen: The option, give me your thought on the are location of sanctioned encampments?

>> We're trying to I'm sorry to keep repeating myself, being able to find land where we can place people and secondly how we can get through the legislative barriers and the regulatory barriers to make it so

! 31! we can provide safe stable suitable housing for individuals and transition them into long term permanent housing.

>> Councilmember Nguyen: I understand the frustration. Go back to my first question, I think it may be overwhelming on you on staff but if we were to help provide more staff and that portion dedicated to the focus on some break through get some empty land I think I may not be totally informed but I think there's got to be some land out there either private or public that we can hire, lease or make use and allow some people in the meantime to gather there at one clean, bright spot, that they can be service and help, while waiting for the permanent solution. For example, one of my esteemed colleagues, what would the county use part of the county fair ground, for example. So I mean, I understand it's not easy but do you think we can at least put some effort, have somebody dedicate just for the pinch of looking for an empty parking lot or land somewhere that we can have some sort of focus, controlled encampment? Do you think that may happen?

>> Jacky Morales-Ferrand: Councilmember, we have not been working alone on trying to locate a site. We have been working with the office of economic development, PBCE, and where do we have city owned sites that could be potential for us to site a transitional community? We are hoping to come back to you with some ideas. We will complete that work by the end of June regarding fully vetting here all the sites that the city controls where we might potentially be able to site a transitional community. So we believe we have sufficient staff to do that piece of the work. We have approached the county regarding the fairgrounds and again we all have to have some sort of will or desire. And the county is looking to site their transitional community as well. They are doing the same type of work. We hope to come back to you with some ideas of where we could do a pilot site.

>> Councilmember Nguyen: I would appreciate very much. Again, I want to support you. I know this is an overwhelming big subject not only you but the entire city. So what I'm trying to say is as a council we would like to could whatever we can to support you. Because this is a big problem, a long term problem, and I think it would take a long time. But while waiting for that, we still have people on the street. So I mean again, what that number will have shocked me, $520 million a year for the homeless, not the county, the city, therefore again I really thank you for your report. I can't wait until we meet again, with some programs, and aid that we can get our hands on. Thank you very much.

>> Mayor Liccardo: Thank you. Councilmember Matthews.

>> Councilmember Matthews: Yes, certainly a complex set of solutions for a very complex problem. I only have one question. I didn't quite get the transition in place housing, it sort of sounds like an

! 32! oxymoron. If they are in place already they're not really homeless. Could you just explain that a little bit?

>> Yes, councilmember. The concept of transition in place is essentially rapid rehousing. The homeless individual you place them into a housing unit with a time limited subsidy. Our subsidies typically last two years and after the conclusion of that subsidy they are able to stay in the apartment that they're living in and pay the rent on their own. That's why we need 30% AMI units, so people have the opportunity to afford them. If we place them into a market rate unit, likelihood that they will be able to stay in the unit after the voucher expires is almost zero.

>> Councilmember Matthews: They're homeless to begin with and they're subsidized.

>> Uh-huh.

>> Councilmember Matthews: Okay, thank you.

>> Mayor Liccardo: I just wanted to follow up on one question and perhaps I didn't quay it clearly enough about the permitting issues often the hotels or motels. What it says in the report is that we had dilt leasing up or getting a felon -- difficulty leasing up or getting a nonprofit interested. One of the concerns was the difficulty of getting a C.U.P. That is where I was going with the permit question. If that's something that the council can change then let's change it. But maybe you can help us understand is there something we can change there?

>> Jacky Morales-Ferrand: I think we're not ready yet. Upon further discussions, whether three can recommend anything, we can come back with a recommendation, but at this point we haven't found anything.

>> Mayor Liccardo: We'll keep plugging away. Many members of the public have been patient and would like to speak. If you could come down to the base of the stairs, Ellen hunter, may be Eileen hunter. Forgive me if I mispronounce your name. Bare Chans followed by Gwen Meyers, followed by Ezekiel Lopez.

>> My name is Eileen Hunter. In 2011 during my commute from San José to Palo Alto I met a 60-year- old woman on the 22 bus. She had severe osteoporosis and carried all of her possessions with her. She rested and I would like to introduce you to the women's gathering place. We have one of the only safe environments for unaccompanied hoaxless women in downtown San José, they come inside at noon on Monday and Wednesday to share a hot meal connect with each other and women from our

! 33! community. They rest and recharge and leave we hope better prepared to face the challenges of homelessness. Average age is over 50. The study found more women are persistently homeless, just be, with your help the next step is providing them with a home instead of the streets. Thank you for the opportunity to speak today and come on over and visit us, we're right nearby on 4th Street.

>> Mayor Liccardo: Thank you, Ms. Hunter, thank you for your work. Suzanne.

>> Women's gathering gives me a chance to gathering there are several of us women who have been been helping each other. The women's gathering is one of the only places in Downtown San José for homeless people like me. We ask you to find housing, we really do want a place to live. Thank you to your support, God bless you. I'm the one that's out on the street and I'm 50 years old. I've been like sober, the women's support group helps me to stay clean and sober. Thank you.

>> Mayor Liccardo: Thank you Suzanne good luck. Is Gwen Meyers.

>> I'm housed right now but as offully time I will be unhoused. I was in a shelter last year. I found a place. And in April of last year so I've been housed for like 18 -- 13 months. I will be homeless as soon as I leave this place. So I need a place to live. I am 60 years old. I've had two strokes and two heart attacks. I need housing. I need housing with a bathtub is what I really want. I attend the women's gathering place and I attend the recovery center also. And I just need housing quick. Thank you.

>> Mayor Liccardo: Thank you. Mr. Sanchez.

>> Mayor, Vice Mayor, councilmembers, my name is Ezekiel Sanchez. I've proud to be part of the group that gave me inspiration to get out of the street. Downtown street teams, I at first did not even have a need for wanting, you know to get myself out. But I fell into this group that gave me everything that the city has offered. I've been a citizen in this country, from Texas, I've lived here in San José for 28 years. And I would take probably half of Texas to take me out of San José because I really love this city. It's given me great opportunities and I think you know it's an opportunity for a lot of my fellow members that have been in the street to be able to have these groups, these wonderful opportunities that have been given to succeed and get yourself out of the streets. I lived in the street for about a year and a half. And I lived in the jungle. I lived in the streets for the last six months of my life and I can honestly say that I'm very thankful that the City of San José has given us these tools to be able to get ourselves moving in life again. It's not something that's given to us. We're working for it. We have to go look for a job. We have to get these places moving, to be able to have a phone, to be able to have a bus pass, to be able to have a place to actually shower and be presentable now, that I actually feel, to

! 34! be employed I'm thankful to be back in the society and paying taxes for the City of San José that I'm very proud to live in. Folks I thank you for your time.

>> Mayor Liccardo: Thank you, Mr. Sanchez, good luck. Arcadia.

>> I'm Arcadia campa. A former homeless woman facing multiple barriers in life. Drug addiction keeping me from a job, and being homeless. Scared for asking for help, being rejected, from the solutions to overcome these barriers, visiting the encampment known as the jungle. They have taken measures helping others be defended against and with all their hard work and dedication they put for all of us, has been a great accomplishment in life. Homelessness, having a stable job and supplying us in everything from the basic necessities to carry on our daily lives truly, has a positive imract in life, that tbris me hope and I know San José loves and cares for us. Thank you.

>> Mayor Liccardo: Ricardo Lopez, Roberto Aguirre.

>> I'd like to come and say thank you and continued support the DST program which I'm currently involved in. I'm currently housed.

>> Mayor Liccardo: Thank you, Mr. Lopez, thank you all for coming. Benjamin Victor de Soto.

>> Hello, my name is Benjamin Victor de Soto IV. I am a formerly homeless person, downtown streets team, I'm now in school I'm trying to get my education going, I don't have the burden, I have a place to lay my head I can shower, prepare my own meals and have a place to store everything. I don't have to worry about stressing out where I'm going to go from day to day. I feel comfortable. And I'm aiming for success with this program. I now attend San José conservation corps, I'm trying to get my diploma. I have signed up for americorps. I'm trying to be a leader and make an example for not only myself but for the streets team for city and I volunteer and I give back to the community now. So I try to be very active and very positive in what my goals are. So thank you very much.

>> Mayor Liccardo: Thank you, Benjamin, Pat Serra. Pat's not here. Robert, come on up.

>> She's allowing me to come up. My name is Robert Aguirre. First thing I want to do is indicate appreciation for work that's gone into the report, also all the possible solutions that have been proposed. Would I have to say, though, that there's some steps that are missing in that there's no plan to address the immediate need. And as Councilmember Nguyen pointed out, we have all these people that are living outdoors, every day, that are trying to survive, trying to duet their lives together. And they're constantly being chased around by the police, they're being moved from place to place and they have

! 35! little or no security. I have here a stack of notices that were from just one location. One location of a site where people had been moved over and over again, since the closing of the homeless encampment known as the jungle. I also have here these are from other locations that have been moved since the closing of the jungle. I've been a part of some of these encampments in helping people in getting somewhat settled in their lives, trying to bring some normalcy for them, bringing food clothing tents in some cases blankets, different things they need to get organized, every time they get swept, they lose everything in their homes. It is difficult when they get swept when their case managers can't find them, they treat them one time they come back a week later they're gone they have no idea where they are. I get phone calls from these groups asking me have I seen such and such a person. I try to help out as much as I can. It's not just a group is, one thing I would like to point out is we need to stop the chasing of encampments.

>> Mayor Liccardo: Thank you, Mr. Aguirre. Pat Serra.

>> Good afternoon. Thank you for taking up this issue and thank housing department for a great report. As Robert said we do need to take quick action. As the people living in our waterways and sidewalks, it's not good, it's not moral to me. That's why I'm here. Faith communities, temples, try to feed people, we try to feed them, we try to clothe them. And we've been stopped from feeding them. It's a moral issue to me. My God told me, I know not everyone believes in God. My God told me in Matthew 25, I was hungry and you gave me food. I was thirsty and you gave me drink. I was a stranger and you welcomed me. This is humanity. This is being a human being. And we have ignored that a long time in San José which is very sad to me because I was born here and I grew up here. Now I live in senior affordable housing. You know? It's too expensive and really, something has to be done. For renters, for the homeless. For all of us who are just trying to survive every day. And especially the older people. Thank you.

>> Mayor Liccardo: Phil Olm Sted, and after, (saying names).

>> I'm Phil Olmstead as you already announced. I represent pastor Nate Jennings. It is obvious they are dedicated and trying to do the absolutely best they can for the city and the community. All right? The council unlike previous councils all right is obviously dedicated to solving problems not setting obstacles. From your comments we can tell that, all right? Your plan is excellent for steps 3, 4 and 5, what it misses is steps 1 and 2. Because there are 4,000 people plus who are going to sleep on the streets of San José tonight. Not in two years, not in 18 months. Not in five years like the plan for ending homelessness. But the city council in its wisdom has signed onto. Those are exceptional solutions for down the road. Those thousands who are sleeping on the streets tonight, I declare myself on that. We need to needle declare a norm on sweeps, sow the city can decide what sites they can afford not to

! 36! sweep. The second step is to set up sanctioned encampments. You are going to have to do studies on that. Ignoring certain locations so we can provide the services and set them there. This will cost the city nothing. It will cost them virtually no labor. The proposals are going to be wonderful over four years.

>> Mayor Liccardo: Thank you sir.

>> But they're going to cost time and labor. Thank you for tolerating me going over my time.

>> Mayor Liccardo: Bill buck.mr. Buck.

>> Good afternoon, mayor and council. My name is Bill Black. I'm a resident of the San José Seven Trees neighborhood. I'm also a member of the Catholic workers of San José particularly the casa de Clara Catholic worker. The San José Catholic worker endorses the letter written to this council calling for the immediate creation of sanctioned camps. California has a rich history of sanctioned camps. These are places where people suffering from economic displacement like today, found shelter found fear support and were able to rebuild their lives. We have that tradition, we just have to revive it. When that happens, there is the safety and the stability to rebuild a life, to access social services that are necessary. And to return to find a civic voice, to actually contribute to our community. California has that legacy and I would not forget it and I would think this is a time to reach back to the history book back in our bags of things that worked and do it again. Thank you.

>> Mayor Liccardo: Thank you. Sandy perry.

>> Good afternoon, mayor and councilmembers. I'm Sandy Perry. I'm speaking representing CHAM dlirches ministry this afternoon. We support the housing department's memo and the programs that are advocated in there. We also support the letter addressed to the city council addressed homeless and CHAM deliverance ministry and many others. We support a moratorium on encampment sweeps and the enforcement of sanctioned encampments, trash disposable and access to clean water and we appreciate the supportive remarks by some of the councilmembers here today. We also want to make slur that in our efforts to help those that are homeless we don't take away from our efforts to prevent people from becoming homeless in the first place and we especially support the review of San José's rent stabilization ordinance, which was suggested in this report, in this memo and also in memos in recent weeks by Councilmember Peralez, and other councilmembers, as well as brought up in Councilmember Peralez's comments today. We think that potentially we can avoid thousands of people from becoming homeless by reducing the lownl rent increases by implementing a just cause eviction protection, and by expanding rent control to cover more units and end discrimination against people holding housing vouchers. CHAM has been serving the homeless in Downtown San José for 25 years,

! 37! despite our efforts we've seen the number of homeless not decline but grow alongside the spectacular wealth of Santa Clara Valley. It is a sign of a broken society, what will we do about this situation?

>> Mayor Liccardo: Thank you reverend.

>> Thank you very much.

>> Mayor Liccardo: Joe lien.

>> My name is Joe lien Jones, I'm a member of homeless shack, as of now, nine pharmacists, homeless the advocacy group the housing network, CHAM, sacred heart, Debug, San José Catholic worker and the national association of social worker South Bay chapter and there's going to be more endorsements coming. Gilroy's compassion center endorsement, three were not able to be present here. Shortage of permanent affordable housing and permanent supportive housing. In the meantime, I.T. does not make sense to leave thousands of individuals without proper sanitation. As an alternative, we know that it works boast in helping homeless families and individuals too stabilize their lives and in protecting the environment. It costs far less than the current cycle of ticketing cleanup educational and courts. Thank you for considering this proposal.

>> Mayor Liccardo: Thank you, Mr. Lochin.

>> Good afternoon, mayor and San José city council. My name is Victor Locha III. I'm the social justice chair of South Bay chapter national association of social workers. The homelessness crisis that we have right now, I wanted to actually maybe read a couple of lines from an article that I feel really kind of sums up what we're facing. This is from Forbes article I'm slur many of you read, April 16, 2015, it says San Francisco and Silicon Valley aren't just turning out jobs these days, America's tech center is also producing what is arguably the nation's worst housing shortage. It goes on to say as Councilmember Peralez had said about our average rent at $2291 a month with 3.5 vacancy rate but I think also what is of interest is that the rent has gone up over the last year skyrocketing as this article says 11.3%. I think what's implicit in that article is how does San José want to be viewed how does Santa Clara County want to be viewed, working in cooperation with the community. I also was an intern at the Department of Family and children's services and I worked with a client who was homeless, simply her hours got cut by ten hours, she's a babysitter working very hard, was actually renting at a very, very affordable place. This landlord had been working with her. We were able to access some funds. The point I would like to say here is I feel the council needs to look at a moratorium on these people who are trying to actually live in the city and get the job right now they would be able to afford a rental unit. Thank you.

! 38! >> Mayor Liccardo: Mr. Johnson. I.

>> I'm Ron Johnson representing the affordable housing network of are Santa Clara County. We would like to add our name to the list of people who are thanking staff or the the great work of this memo. And their effort over the past many years to solve the homeless crisis. We support and help to generate the countermemo, Jolene called it. There's got to be a place that homeless can live in the county without being swept by the police. They're going to take years to come together in numbers large enough to support the 4,000 people who need them. Our proposal in the letters that I think you received yesterday, cost the city nothing. And allows the city to control and put some order into the chaos of living in the streets. And the second is to have disarranged camp -- sanctioned campgrounds, with porta potties and clean water, when you are able to add social services, that would be great too but they can be set up in the next couple of months without doing all that. We need to ask you to review hopefully be coming to you soon from the May 8th Rules Committee the ranchers rights initiatives which is very important to reduce the amount of homelessness. Thank you very much.

>> Mayor Liccardo: Thank you sir. Reverend Jeff Moore and I'm sorry did I call your name? I called your name already? Okay if you could just wait. Reverend Jeff moor followed by Tim Limberger. (saying names).

>> When you've done this for the least of them you've done it for all of them. This has currently become a tale of two cities. City of haves and have notes. I stand in front of you asking you to establish a sanctioned encampment. Fresh water and regular trash pickup. Give the hoaxless enough stability until a place can be created. We are preparing grants to help take care of these facilities. We don't have no place to give them. I'm a founding member of the downtown lions club, we are setting up facilities and opportunities to help serve the homeless but we're looking for a place where we can serve it. We're asking for the city council to think of the less fortunate, some of us feel they are just hopeless cases, reach out and understand some of these are veterans. Again I'm going to point down to our schools. Our McKenny Vento, as I close I had to help a high school friend who is currently working, can no longer afford this city lose his home, take several of his boxes stacked up in my house as he tries to find transitional housing in some place on the streets. He is currently homeless and there is no place for the working class citizen to go. We need to set up this transitional villages now, thank you for your time sir. [applause]

>> Mayor Liccardo: Symptom lineberg.

>> Thank you mayor can I have three minutes if I don't mention cigarettes? I concur with the report but I do think it needs those two steps before it happens. And that's because this is on the long term. And

! 39! homeless is on the short term. Of the 8 million foreclosures that happened in '08 a quarter of them were in California and that's besides the I.T., it is another reason why the price of rentals are so high. We have another 6 million people who are renters. I'd like you to do what the affordable housing network called or the, a moratorium on encampment sweeps. This is really inhuman what happens to people when they are swept up this way. And if we had encampments that were established and had sanitation, had drinking water and were located in a good place it would avoid a lot of the problems we're having. And if things continue going the way they're going we will end one a larger and larger homeless population. And the problem is economics and I'm grad this council addressed some of those problems. Getting a higher minimum wage is one way to address it but also to make sure that there's just cause evictions that foreclosures are slowed by the banks and Services are provided to people. You may think this will attract homeless people if we make things -- make a good place for them. It will. It will get them out of the neighborhood. It will get them into safe living conditions. It will make it easier to provide services since they will be located in a place where people know they are located. It will cost the city money but far less than the over $80,000 a year that is spent for each homeless person and that's what was reported in the Mercury News in a recent article. The mayor said we need creative solutions for the homeless crisis. That means taking action for homeless people now before they get interim housing because that is too far off.

>> Mayor Liccardo: Thank you very much.

>> Thank you very much for your time.

>> Mayor Liccardo: James Lee. After James it will be David Carr, Sean Cartwright.

>> My name is James Lee, I'm here as someone who has family in Redwood City as someone who has a friend in San José who volunteers to clean up Coyote creek and the first cleanup after the mayor-led eviction of the homeless encampment known as the jungle my friend was approached by more than a few homeless people suffering from what could basically be called PTSD. Asking if her boyfriend and her were there to evict her, asking if they were city services, asking if they had had housing, they had heard something about housing after the eviction at the jungle. I bring this up to kind of urge to realize how urgent the situation is. I also support the letter that you received. That was included in the agenda packet. People need solutions now and staff did talk about needing -- there's a lot of regulations that set up barriers to creating sanctioned encampment but providing porta potties, providing wash stations doesn't require regulations, with people who work with the city stopping encampment sweeps require a conversation with your police chief. This is not something that needs a lot of regulatory bureaucratic action for actual progress for these people to occur. People need to see a change now and as the mercury article which I'm sure most of you have probably seen stated yes, housing is expensive,

! 40! housing people in motels is expensive but for people who are homeless, once they got housing the amount of cost to the public decreased from the mercury stat was around $63,000 a year for a typical person down to around $20,000. The if you are a fiscal conservative who doesn't care about people living on the streets, whatever you spend now is going to be anet benefits --

>> Mayor Liccardo: Thank you sir.

>> -- to the city coffers. It is a notion the city should get behind.

>> Mayor Liccardo: Thank you sir.

>> Mayor and everybody else on the council, the men and women from the city I just want to thank you guys for work that you're doing. I got a housing voucher and though it's been a little tough finding a place that would accept them because of the inches in the amount the rents is and in the voucher. But through the outreach program, I was able to find housing, get a job, so it does work, you know. There are those individuals that we do benefit from the programs. So it's not wasted money from you guys. It's actually helping people get their lives back, get their families back, and giving us some dignity that we are human beings, and it shouldn't be a crime to be homeless. None of us want to be homeless, trust and believe in that. Be able to wash your face go to the bathroom and eat some cereal. It's horrible when you wake up outdoors. Dangerous. It's not safe. Once again thank you for taking up this issue Mr. Mayor and the council and for the city for providing these services. We really appreciate it. Thank you.

>> Mayor Liccardo: Thank you sir. Moya merryweather.

>> The plans and ideas in the report are wonderful and they are fabulous progress and at the same time they are woefully inadequate. They are inadequate including the plans for transitional communities. These plans do not serve enough people. These plans might serve if all of them are enacted they might serve 500 people out of the thousands of people who are homeless in San José. For the others, for these other thousands of people please enact a moratorium on sweeps. You can figure out how to do this. It might be a moratorium everywhere in San José. It might be in some areas. It might be only on city and county land and park lands. It might be the land behind City Hall where I have seen homeless people. Please provide port apotties and washing stations. They do not have to overcome regulatory issues. I know that the letter that you received from a number of organizations asked for sanctioned campgrounds. I am asking you just to enact a moratorium on sweeps in some way and to in some way give people sanitation and trash collection. This again does not make you jump over as many regulatory hurdles as it would if you tried to sanction campgrounds and make a plan for them. It is faster

! 41! and easier. It is something that can be done. And it would provide much more safety. It would give people somewhere to go. It would reduce suffering and improve the health and sanitation for the many people who will remain homeless. Thank you so much.

>> Mayor Liccardo: Thank you. Sean cartright.

>> I think we need to treat this as the emergency it is And treating it anything other than it is is unacceptable. We have nearly 5,000 people on our streets by a conservative estimate and we are talking about accepting a progress report. We don't need progress, we need action now. We need action to start today and the kind of progress that we're doing is 778 housing opportunities. Opportunities for almost 5,000 people. And I know that there's work being done and it's good work but it's not enough work. You guys need to be more creative, you need to find something and starting with the sweeps and I totally approve of the homeless network plan totally think that's a good way to go, at least that's a broader start. I came here today as a court appointed special advocate for foster kids because we're the fourth largest number of unaccompanied youth right here in San José. We're also a hotbed for child sex trafficking and those two things go hand in hand. Because 70% of the children that are trafficked inside the United States come from foster homes. The kids are being trafficked right in front of those motels, we know those motels, if we take stronger action against sex trafficking shut down those motels and convert those into housing for the homeless. Two birds, one stone. Get really serious on those things and that's something we can take action on really quickly. D-3 under some great new leadership we have 240 encampments in San José, D-3 have 88 of them. I want to make sure because some of the new housing going for D-3 some of the new homeless housing is in D-3. I don't want all the housing in D-3. You need to treat it as the emergency it is and take much broader action much quicker action.

>> Mayor Liccardo: Thank you, Richard Loke. After Richard is Bruce Roberts, Jennifer loving, Anthony King, David Wall and Yolanda Gutierrez.

>> Thank you, I appreciate the opportunity to address you today. I've met most of you in one form or oop. A member of the Willow Glen lions club, thank you all for the support of the lions club. I do endorse the program from the homeless coalition, I'm not sure how to name that. Absolutely. The system is very, very fragile as you know and a little adjustment here makes something else break. I think the report is fabulous and I invite you to go ahead and step outside of the box that you've been looking in and living inside of. Well, some people are living inside of boxes, right? Literal. And you have 4,000 homeless people. Just imagine if you incorporated just one-25th of those people, that is one example of stepping outside of your box. On Mother's Day I went to find my brother. He has a place to take a shower and a place to eat. One thing, how do you create urgency, imagine if you will being

! 42! stranded at an airport. You have everything you need, food, lodging that all important restroom. Now imagine if you are stranded in a different way, you're stranded right here inside the confines of the City of San José. This time you don't have a restroom. What would you do? How would you feel? Would you feel safe? I invite you to consider creating urgency as if it's you who is living on the streets of San José. And it's not game of whack-a-mole, we do need to stop that by the way, that is a good call. Thank you for your time.

>> Mayor Liccardo: Thank you. (saying names).

>> First I want to commend the housing department and the council for their interest in this problem. I'm going to speak for myself. Five years ago I faced homelessness myself and I can tell you that the first thing on my mind was security and safety for myself. As I mentioned before, I have sleep apnea and I was scared to death that I would wake up not being able to breathe because I wouldn't have my machine on me and basically die. I think if I were homeless I would not be alive today. So I urge the council to really work to addressing this need immediately. Not for the future. Because I speak for myself, from my own heart. Thank you.

>> Mayor Liccardo: Anthony King.

>> Hi, are we taking heart for the sacred heart housing action committee. Directly connected with affordable housing issues, the sacred heart housing agency, would like to acknowledge the home not found research study. That being said, Shacq would like to thank, unsheltered homeless community in the city, Shaq, emergency solutions grant funds to develop a temporary sanction id camp site or sites that would be away from our City's waterways, complete with hygienic and sanitary infrastructure and with place based housing subsidy included and weigh this option against the cost of continually conducting sweeps. While this is unorthodox, it would allow other groups such as the county's backpack medicine program and others, the opportunity to work on the barriers clients may have to housing while they prepare for affordable housing opportunities to present themselves in our region, thank you.

>> Mayor Liccardo: Thank you. David Wall.

>> This is not really a complex problem at all. But it does require the president of the United States to come forward to the nation to realize and communicate to the nation that our country has been in a managed depression for 40 to 50 years and has managed to break down since. The works project administration that was out of the depression years, which everybody was employed, that is your first step. Your second step is to create work projects that benefit the nation as a whole. Specifically you could create a water project from your Minnesota states or what have you, to bring water to your arid

! 43! states. But without addressing it as an entire nation because the city model concept of the United States has surpassed its breaking point. It can no longer support the growing populations that you have today. Left alone as it is today, there is no amount of housing, there is no amount of jobs that will take care of the vast numbers who not only sit behind me but of our on the streets in our communities throughout our state and throughout our nation. Failure to address this on a national level, you will not be able to address it on a local level. Primarily because you simply do not have the resources, you will never have the resources and therefore Mr. Mayor it is incumbent upon you to put forth this case in chief to the governor of the state of California to put this forward to the president of the United States. Thank you.

>> Mayor Liccardo: Thank you, Yolanda Gutierrez.

>> I as member of the homeless community feel unwanted and feel like you guys are trying to push us out of the city. I hope you guys are willing to offer us civility, as of now I don't believe anything you guys have to say. I honestly don't. I want to be able to believe you guys. That's honestly my point, thank you.

>> Mayor Liccardo: Thank you, Phil massacola.

>> Plem, thank you for letting me speak, I just lost all my notes. Thank you very much, Karen. You do do great services, I love it. I want to thank Jacky but I want to thank Jacky for something different than the others have thanked her for. That is two things actually, one is that you called this a crisis in your report. And I think that makes it official enough for all of you to consider this. And I've heard in conversations with all of your staffs, varying degrees of that same statement because of the constant calls that we are getting here from residents and from businesses everywhere, that this is a crisis. I also want to thank Jackie because she challenged the advocates, which you now have -- know that by Jolene's account who we are together that we should stop whining and go work. And that's what we have committed ourselves to do. And in going to work it looks like a partnership going together. So housing department supports the clients and we support the housing department, also supporting you. By doing that we can acknowledge the following thaings we heard already, things that we -- things that we layered. Legislative and funding, these are things that we're ready to do, ready to work together on so that we can solve this problem. If it is a crisis, if we can acknowledge that hopefully today we know the crisis creates uncertainty and fear, responding hopefully today and that DST guys that came in here and talked about this, talked about how they changed their lives with the hope that they got from support. Let's get create hope today.

>> Mayor Liccardo: Thank you, sir. Karen addato.

! 44!

>> Thank you for having me today. My name is Karen addato from break through outreach, we are a local nonprofit agency. Over the last couple of months we have been doing an awareness program for our microhousing program for homeless. We have been reaching out to churches big and small as well as businesses. It has been well received thus far. As a matter of fact just last week we were invited to do a presentation in front of 80 church leaders here in San José. The innovative concept is designed to service more people more effectively. We would appreciate the opportunity to give a meeting and give more information in regards to this program. We are ready to present. We have 75 year business plan from a Stanford business graduate. We have plans, a pro forma, a construction estimate and much more. As far as our shorter term solutions we have a our sponsorship program which we are is supporting under our SVC123.org Website, we give a presentation and drive them to the site. We use constant contact to reach out, as new sponsorship opportunities come online, drive them to the site in hopes that they will potentially sponsor to help the meet the needs of those that are being featured. This program we've had some pretty good success in a short amount of time. As a matter of fact we just recently helped a family of six that were living in a van relocate through sponsorship through our site. They are now housed they have a job and they are off and running. In two weeks alone why received calls from seven families, with 22 children under the age of 13. Thank you for your consideration.

>> Mayor Liccardo: Thank you. Mossam.

>> Hello, reply name is Mas rvetiona, I'm a recent San José State graduate and I really hope that you support the sanctioned encampments, it will reduce complaints from residents and businesses because many of the campers will be away from residents, waterways, schools and businesses, complaints by constituents would be significantly lessened and also, San José has 4700 unsheltered residents. At the best, at best, the City's proposal would help 500 hopefully in a number of years. What happens to the other 4200 residents? Our plan would help many more people. So I really hope you support it. Thank you have a nice day.

>> Mayor Liccardo: Mr. Arias followed by.

>> Ross Signorino: s.

>> Good afternoon, Mayor Liccardo, good afternoon, councilmembers. My name is Jamie Arias. Structured homeless, thank you for staying late for us and doing something about a sentence, it is a sentence to live in the streets. Waste, every day every night, still working like we should. So my request for you is to, even though you don't have the details among might row housing strategy, just let me tell you that it will save millions of dollars every year. And instead of that, you will have a person that

! 45! is housed, primarily, and secondarily, we're going to train him to get a job. And there's going to be tenant union to control themselves. And this is something that we can start doing today, tonight, so please, consider this in your deliberation. Thank you.

>> Mayor Liccardo: Thank you, Mr. Signorino.

>> Brief side bar. I was glad district 5 stepped over here in this side into the light. Mr. Mayor, there's nothing I can add to what these people said, they were eloquent, these people are good people and the emphasis is on a word that's not misplaced, the word frivolously. Probably a lot that -- probably they will never meet in their lives but here they are working at it. It's a shame. I'm not going to say the richest country and all this stuff. We've gone through that. But it's a shame that we have close to 5,000 people out here homeless, at least as we can count and we should do what we can. We must not forgot medical, medical is important to people. That is your security in life, you feel good. Mr. Mayor, members of the council, I'm sure you're doing your best and you will continue on this problem because it is a problem of conscience, we have to do it. Thank you.

>> Mayor Liccardo: Thank you, that completes all of the testimony from the public on this item. Councilmember Khamis did you have your --

>> Councilmember Khamis: Yes, I want to thank everybody who came out to testify and waited for a while. I am too interested in learning more from staff what can be done as far as providing a more structured area that we can hold folks until they get permanent housing. I mean I thank you for the wonderful plan. To me it looks like you're doing a lot more than housing 500 people, looks a little bit more than that to me but the point is clear. There is still a much bigger problem. I'm hoping if you can come back with solutions, I know that people are talking about doing these encampments and allowing people to stay in them. And I know actually that sounds like a good idea to me as well. However, finding a place might be a little bit laborious. Have you looked at that?

>> Jacky Morales-Ferrand: They are also looking at tent communities to see how they could implement. The city has looked at we're calling it transitional communities, mini, tiny homes, those are challenges for us to implement. The first question is where would we put an encampment or even the mini house community? That's our first challenge, we hope to come back with potential ideas. A tent community is even more challenging because of our mini house community because of our building and habitability requirements that we have. We haven't looked at it in the same level as we have looked at the mini tiny homes potential but I'm certain that as we continue to explore, we will have more regulatory be issues that we would have to overcome.

! 46! >> Councilmember Khamis: I'm willing to hear whatever suggestions you might have. What time frame sms Jacksonville given the time frame that we're running out of time before your break, at least early August after your break.

>> Councilmember Khamis: Regarding how much less expensive it is, rather than having to go through the medical process or jails or what have you yet they are actually currently withholding millions of dollars in the redevelopment funds from us that we had promised to use for low income housing and I want to be clear that we are spending many millions of dollars, thanks othis mayor and his initiative, to providing more low income housing. Our previous mayor despite the fiscal situation that the City's been in had poured $4 million, in the year that he was here that I was also a city council member, and I wanted to let the public know that we are dedicated to making sure that we are solving this problem. It is a difficult, very difficult problem to solve. And we did have a large homeless encampment at the jungle and that wasn't working out. We had one near the airport, that was becoming problematic as well. So having these large encampments is not always -- they can run into problems as well. So I'm looking forward to hearing more of your report and I'm looking forward to seeing what other solutions are being provided by the county because, quite frankly, I feel a lot more can be done by the county, especially in light of the fact that millions of dollars are being withheld from the redevelopment agency which was tasked for low-income housing. So I'm looking for answers not just from you but the county and I'm hoping you're in discussions with them on that issue at well. Are you?

>> Jacky Morales-Ferrand: Yes we are.

>> Councilmember Khamis: Okay, thank you for all the work you are doing. I did really take the letter to heart from the public. I do feel that more needs to be done. And sites do need to be looked at. Because it's tough to keep track of some of these folks. And you kick out one encampment, they just relocate someplace else and then you lose track of them. I do sympathize with the social workers who keep track of the people they try to help. I'm looking forward to seeing what more can be done from you and some more suggestions in that arena. Thank you Jackie for your work and your staff's work.

>> Mayor Liccardo: I'm going to direct my colleagues attention to the clock, we have a dozen more items on the clock. We're going to have to concentrate on the issue and limit public comment to one minute.

>> Councilmember Rocha: Thank you. I didn't notice the commercial linkage fee that was by the council, did I miss it or is that not something you included in this category?

! 47! >> Jacky Morales-Ferrand: We did not include that in this category. We are hoping to get an updated report in June very soon to let you know what we're doing with the commercial impact fee. I don't think we're going to be able to come back into the fall because we're still trying to figure out what strategy we would use and are evaluating the options that we have. But we are definitely -- we did not forget it, it is on our look and we hope to bring back a suggestion on how to move that forward in the fall.

>> Councilmember Rocha: Okay. So as important as what's presented on the housing impact fee, I kind of view this opportunity as one that would be just as important, too, as a funding source. Which is why I'm continuing to pose the question and nudge the issue as to a sense of urgency on it, and it would be great that we could get to a decision point, to determine whether it is something we want to pursue. I think it's another facet or component, whether we're in any stages of development or not I'd appreciate seeing it in here if possible, thank you.

>> Mayor Liccardo: Vice Mayor Herrera.

>> Councilmember Herrera: Thank you mayor. Appreciate the report and I'll try to -- I'll keep my comments brief. So I'm not going to repeat what everybody else has said. In temps of the safe parking program which I supported in the previous council, too, have we analyzed how many folks would benefit from it? I see that we're looking at it as -- because we have limited money to implement it. I understand that, we're looking at a 30 vehicle capacity but if we just looked at the number of homeless out there how many could avail themselves if we had the money, how many individuals could we take care of with that number?

>> Councilmember, 2013 I enumerated 477 individuals living in their vehicles in Santa Clara County. We have learned this is an undercount so there are hundreds living in their vehicles in the community.

>> Councilmember Herrera: So there is a sizable amount that we could help with that solution. I do appreciate everybody coming out and I'm constantly thinking, I'm supporting a lot of different solutions that we are looking at including mid range and longer term. But it is troubling that we don't have veriful things we can do in terms of an urgency, being able to do things quickly. I think everyone up here would be able to do something quicker. But we have got to do things that will work and work through the process. So I'm very interested in anything you guys come back with that helps us address urgency and any things that we can do including try to find funding for them, I think that's a really big issue. Even in terms of parking, I'm just wondering, I'm thinking out loud here, if we found a location are there other kinds of vehicles that could be used on a temporary basis besides cars? Are there buses? Are there other kinds of things that could be converted into temporary housing?

! 48! >> Jacky Morales-Ferrand: I think the issue of anything else is the habitability issue which is we are required to follow building and fire codes and safety codes. And so our ability to waive from that, the staff doesn't have the ability to do that. We are looking at how that can be done through legislation but even that we have found will take time. There was a question in a previous item that we brought forward by Councilmember Peralez, regarding shelter beds. And we do know that there are less than 100 available shelter beds that are not fully funded today. And so we have our end discussions with the county to see if they can provide the funding for those shelter beds and that is something we are looking to resolve within that next month. So they are looking to determine how many shelter beds they can fund and come back to you to say, these beds remain unfunded. Anything else like the tent community people living in buses, those again are all solutions that, from a staff perspective are challenging because they don't meet health and safety code regulations.

>> Councilmember Herrera: And I don't think we want to set up a situation where we are putting people in danger, doing things that create environmental issues. I'm with you there. I was just thinking if we get the parking situation are there other vehicles that could be utilized too? And we are just trying to think out of the box a little bit. And I also supported with the mayor the tiny houses initiative which again is a small part but it's a piece of a solution that requires a lot of different things. So I appreciate staff's work. I appreciate everything you guys are doing and look forward to continuing to work with you in creating solutions for there.

>> Mayor Liccardo: Councilmember Oliverio.

>> Councilmember Oliverio: Thank you mayor. For all those who just spoke on this issue could you raise your hand? Real key here. City Attorney, City Manager we have a pass-through conflict with the county on the former Redevelopment Agency. We have a proposal sitting before the county to split that and give $10 million a year, $10 million a year towards homelessness. And from what I understand the county has been nonresponsive to that request.

>> City Attorney Doyle: The discussions have taken place. The prior City Manager had some preliminary discussions. We're hoping to revive those discussions in the next couple of weeks.

>> Councilmember Oliverio: The prior mayor made that proposal.

>> Mayor Liccardo: And I made it.

>> Councilmember Oliverio: Mayor Liccardo made it again. Can we have that come back to the council on that conversation? Obviously the solution has come up, there is a quick remedy $10 million,

! 49! we have a conflict of governments, I don't know whether it's personalities or what is the conflict. I think there's a solution.

>> City Attorney Doyle: Before the July break we'll come back with the status.

>> Norberto Duenas: I want to emphasize the critical situation, and we'll be setting up those meetings in the very near future.

>> Councilmember Oliverio: For those who raised your hand, you can speak to the Board of Supervisors, the idea that was put forward by two players now, to put together some of the solutions that you've asked for, and we need the support from you as well, thank you.

>> Mayor Liccardo: Councilmember Carrasco.

>> Councilmember Carrasco: Thank you so much. I want to thank everybody for coming out and speaking on this issue. I think it is a critical issue, I think we are in a crisis mode and I think this does deserve an urgent response. And I think -- I don't know if you recall Jacky when we first sat down, I said to you of all the issues that we've been dealing with, this seems to me like the most pressing and almost the most difficult issue for me to wrap my brain around because of all the folks that we need to serve. And I don't -- I don't quite understand how to find the resources to address such a growing issue. So a couple of things. Thank you so much for all your work, I think you did a fabulous job. I want to commend everyone who has done so much work. I know we have had issues in district 5, and I know it's happening all around the City of San José. My personal issues that we've been dealing with specifically in district 5. So I have a couple of questions. Because the memo that was introduced or the letter that was introduced by the network, are any of those suggestions feasible just to deal with the immediate concerns? And to be able to address some of the safety and hygiene issues of our folks that are on the streets currently? And I know that there's a lot of regulatory issues that need to be addressed. I understand that. But given the fact that they are already in the streets, they're using barrels as bathrooms, they are using makeshift you know whatever they can find as their bathroom. So is there anything there in that letter, any suggestions that we could implement in the immediate future, so that we wouldn't have to wait for the immediate solutions?

>> Jacky Morales-Ferrand: Yes, the immediate need to try to house people as quickly and to bring services to them, I'm going to let Ray take the majority of this question. But our response has been the issuing of the RFP, to think of alternative ways that we could bring services directly to people instead of creating a larger encampment. So that was one strategy that we're exploring, whether it be something

! 50! like the Lava-may idea, a mobile shower going to encampment to encampment, seeing if we could find a provider. I'm going to let Ray answer that question.

>> Thank you, council. The two steps or phases identified in the letter from the public, step 1 the moratorium on encampment with groups there would be a number of different issues from [applause]

>> Some environmental, some environmental and neighborhood groups that would be considerations. But it is a staff policy decision. With regards to step 2 step 2, the numbers of places where we could site encampments, and it's fraught with many more challenges of the two.

>> Councilmember Carrasco: And point number 2, I'm thinking of number 2 using it as a temporary, did you call it a tent community?

>> Tent community is one. Yes.

>> Councilmember Carrasco: I was thinking, my nephews did the week long burning plan, saw pictures of it, I doubt that they were under code enforcement. But you know, I was just thinking of some of those events that they go to where they're spending seven to ten days, it's a very interesting experience for them. But my question is, are you beholden to those kind of strict regulations? I know you have to secure safety and everything. But these individuals are already out here on the street. They're already dealing with a lot of issues that are --

>> Applause.

>> Councilmember Carrasco: That are putting them at risk. They don't have, you know, anywhere to wash up, they don't have a bathroom. They don't have any sort of safety whatsoever. If we could put any sort of measures it would be an improvement. Where could we have some flevment to secure their safety and their hygiene? That's all I'm asking. I'm jug asking where could we be flexible and be able to provide that for them?

>> Jacky Morales-Ferrand: That's the challenge. Where can we be flexible, where we have regulations that doesn't allow us to be flexible. Certainly on a seven day camping adventure you can have some flexibility. But the magnitude of the encampments we would need to have sanctioned here, it would be more than seven days more than a year more than two years where you would have people living in long term conditions. So that's the biggest challenge, where do we find -- that would be the first challenge. Where would you find a site in San José that we could put tents up for 5,000 people would be issue number 1. And then secondly how could we overcome the regulatory requirements regarding

! 51! health and safety? And I'm going to turn it over to the City Attorney regarding the health and saves issues. Because that is a regulation that we cannot overcome easily.

>> City Attorney Doyle: And there are a number of options. I think they've been brought up in the public discussion. Everything from tiny homes to something like RV, temporary housing. Those are all being looked at. One of the biggest constraints are state law building codes and we are looking at legislation to try to give the legislature greater flexibility, quite frankly, there are certain requirements that need to be met. Everything from ADA which is a federal law, which we think we can meet, to building code and prior code and those issues, habitability has been mentioned. Whatever we do out there we want to make sure one, it's safe and it's legal. We really want to get to a point what is transitional? If it's less than 30 days you have greater flexibility but the problem is we are looking at something that's longer and while not permanent, it's transitional but more than just the short term. So I expect that in the next few weeks we will have something, Jacky alluded to that if we don't get back to you before the July break it will be early August. We're really trying to shoot for something by the end of the month though.

>> Councilmember Carrasco: I'd be concerned in terms of waiting. I know you have a lot on your plate and I don't want to overburden you. I would be concerned to wait until August. But you know your workload better than I do. But I do think that it's a concern. I'll tell you again. The only experience I have very directly was with the situation that we had over where you were very, very helpful and we had to bring a lot of individuals to the table, the county, the state, the city, a lot of folks, because it was a situation that was potentially dangerous, not just to the residents that were there but also to the individuals that were, you know, living in that encampment and we needed to act with some wisdom in terms of what we could do with folks there. Again, I have the benefit and the curse, I'm still a newbie, maybe after the vacation I can't, but I understand we are beholden and sometimes handcuffed to the regulations and the inflexibility of those regulation is and that's why I turn to you as the experts in hope that you can I know there can be flexibility, I know you are looking, looking. We know as an issue, we can't take it on by ourselves and so we have individuals who have direct work experience with other residents in our community who need our help. And I just want to make sure that we take advantage of this opportunity that is coming right in front of us. But I want to really thank you for all much your work -- all of your work because you have been so helpful to District 5.

>> Mayor Liccardo: Okay, I think everyone's had a chance to speak. I just want to remind folks that the regulations we are handcuffed by are thought our own. They are the state's. We can always use help at the state level. It was the state who threatened to fine us if we allowed people to stay in Coyote creek. And it would be a fine from our General Fund, our seed corn to pay the state, rather than use the money to house people. We need to understand that we've got a big challenge in getting through particularly in Sacramento. We hope Sacramento will help us if this Atkins hotting bill goes through. But

! 52! in the meantime, our small but mighty staff is pushing through and we hope that we'll keep pushing for solutions. Everybody has had a chance to speak, there is no action to be taken other than accepting the report. I'll entertain a motion.

>> Councilmember Peralez: Motion to accept the report.

>> Second.

>> Mayor Liccardo: All in favor, opposed, all right that's unanimous. We'll move on now to item 4.2. Again I'm going to remind council and staff, we are now at 5:15. We've got a dozen items to go. The rezoning real property located at the southwest corner of Saratoga and Williams.

>> Harry Freitas: Thank you mayor members of the city council, Harry Freitas, director of Planning, Building, and Code Enforcement. Considering the time, I will make this brief, you heard from staff on May 12th, I recommended the council continue this item so we could give you more information about what it is rewe are recommending -- we are recommending on this. This is what we are asking you to do today, we are asking you to approve a zoning a permit and findings of public convenience and necessity. Those are necessary when five findings cannot be made on the sale of alcohol, beer and wine, at gas stations. In this case four findings were made. This is not in an SNI or special planning area. This is not consisting of four alcohol locations grouped within a thousand foot radius. The alcoholic use in this area, in this building is going to be less than 10% of the shelf space. And this census tract is oddly shaped and the finding that we could not make, the census tract is not overconcentrated. The finding at a we could not make is it is less than 150 feet from residential. In that case can Planning Commission cannot approve it and must refer it to council. We are making the findings, the beer and wine is less than 10%, it is in not in a high crime issue. In June of 1985, I learned the from Councilmember Matthews, the City of San José, it's on the record but in my conversations with her, she and Susan Hammer were -- it's a -- that sorry. That in 1985, San José prohibited the sale of food an alcohol at service station. In 1990, San José created policy for the offsale of alcohol, gas purchases, state of California amended the state policy that it requires these findings if there are areas ever undue concentrations. More alcohol sales than the average. In 2006, San José modified title 20 and title 6 that created a local process for what we are talking about today which is the determination of public convenience and necessity. In 2012 we also modified the rules to allow -- to eliminate the rules around what's called mandatory denial. Next slide. So the way we approve alcohol sales in San José is, there's two routes. The applicant either files for a planned development permit or conditional use permit. It goes to a director's hearing which is staffed by the planning staff or to Planning Commission. If it immediacy all the findings of title 20 and is not in undue concentration area it can be approved at the director's hearing or Planning Commission. If there's an undue concentration area in terms of crime,

! 53! greater crime, or greater concentration of alcohol establishments, than a PCN must be made and that means it has to go to the city council. Then city council has the ability then to approve the PCN and approve the gas station to sell beer and wine. So San José's approval history we researched that since 2006 we have approved 23 outlets both for convenience stores and at gas stations. Those 23 are listed in the back of my supplemental memorandum. Including in that, those 23 were generally approved 50 Planning Commission at the director's hearing. A few cases a while ago, two gas stations and three convenience stores were approved by the council. Make the findings of convenience and necessity. Going back to what we are asking you to do today, with all that information, what we have here, I'm going to go to the census tract, it is not an SNI, it's not grouped greater than four, it's not a majority of the sale, 10% of the shelf space and it's in an oddly shaped census tract. It is the issue, it's within 100 feet of residential. The recommendation is to approve this with these findings. I just wanted to show you the census tract. I know the resolution on these are not great. The property is at the corner of a census tract. The first 150 feet of this die grabs the back of this house, the second radius is 500 feet and the next is 100,000, Slavic shop and Los Palmas Mercado. This project was approved by the Planning Commission, Mr. Robinson, here, he'll probably want to speak on his item, this is a before and after on white road, here is another before and after on de Anza road. I know that was a lot of information, in a short period of time. I'll be glad to take questions.

>> City Attorney Doyle: There are three items, CEQA which is the neg dec, there is the ordinance which is a rezoning ordinance and the PD permit. If you approve the neg dec and the rezoning ordinance, the PD permit would have to come back, when we come back with the final reading of the ordinance, because that's the approval of the ordinance. You can give us tentative decision on the permit but both the rezoning and the PD permit would come back in two week.

>> Mayor Liccardo: Thank you for the supplemental memorandum, it's helpful. I looked at I guess it would be the addendum at the end listing all the approvals and it appears that the city council hasn't approved one of these in eight years.

>> Harry Freitas: Yes, that's correct.

>> Mayor Liccardo: How many times has city council denied one of these applications?

>> Harry Freitas: That I didn't get the research. For a time we were doing mandatory denials. I didn't check that.

>> Mayor Liccardo: We don't know how many times the council denied it?

! 54! >> Harry Freitas: I didn't look at that, poimgz, didn't even think of it.

>> Mayor Liccardo: The reason why I'm not disappointed, what I said before, I think it's important to understand the rationale, it is not about promoting supermarkets, it's the fact that as we see in national studies there's ample data that connects the ubiquity of offer sale of liquor to a host of maladies in the community, low level crime, assault, domestic voyages, et cetera. The correlations are very strong. For that reason the city made it difficulty in those areas of overconcentrated census tracks, the law requires us to make a finding of overriding significant benefit, it seems to me that's a difficult hurdle to overcome. We overcome it routinely whether we're faced with the opportunity to fill what would be a food desert with fresh food and produce and so forth that's offered through a grocery store. That has been typically how we have overcome and met that requirement. For the most part, I haven't seen that overcome. Outside of that context in the eight years. And for that reason I've been routinely voting against these and has nothing to do with just promoting grocery stores, but the point is grocery stores provide an exception for us. With that, Councilmember Jones. Mr. Robinson, would you like to speak?

>> Vice Mayor, councilmembers, when I spoke to you last month about this project I didn't realize the significant controversial part the beer and wine license. The old ordinance from the 1980s 30 years ago banned all food and fuel. If you sold gasoline could you not sell milk coffee or fruit. No groceries including alcoholic beverages with gas. That old ordinance was changed about ten years ago. It was changed because, one, mechanical work, oil changes tire sales were happening less and less at gas stations. New fuel facilities were not being built in San José, number two. Number three, existing facilities were not allowed to be upgraded and were looking more and more tired. Lastly the new retail entrance, retailers like Costco and sam's wanted to sell gas. This would be our fifth San José project. Two of the previous four have ABC licenses, the one on de Anza boulevard went through the public convenience and necessity process. Both were major improvements to the property and to their neighborhoods, I appreciate those prior approvals. I hope the direction the council is not changing again. The Saratoga project should be approved for a number of reasons. One, it's a very attractive project. The existing rotten Robbie was built if 1960, and the Taco Bell is old. All overground facilities will be replaced. Three, the project is supported by the planning staff and Planning Commission voted unanimously for it. It conforms with the urban village and grand boulevard projects. Five, the council has approved two of these projects like this, this project meets the current ordinance requirements regarding alcohol sales and lastly, the project is consistent with the City's desire to increase investment, add employment, and add taxes. From the state ABC standpoint we need the City's permission under the public convenience or necessity requirement. The ABC must have permission from the city to issue an ABC license as an individual census track if crime is high in the track or there's an overconcentration of licenses. It is barely overlicensed. Joining with others we would not be overconcentrated. It is important to remember that the P C orN, the city council gets to weigh in up and down on the approval.

! 55! This should be, I disagree supermarkets should have an ABC license, in fact theirs typically include hard liquor. What doesn't make sense to encourage some retail development but discourage other retail development. Jim Collins and his great company wrote about avoiding the tyranny of the or and embracing the genius of the and. I strongly encourage the city council to embrace the and and reject the or, more investment and development the whole street the whole area can be improved. In closing I again want to say I appreciate the planning staff and the Planning Commission's willingness to get to an attractive necessary yum grade of one of our olds -- upgrade of one of our oldest facilities, something our city would be happy and proud of. Thank you.

>> Mayor Liccardo: Thank you, Councilmember Jones.

>> Councilmember Jones: First of all I want to thank Harry for your presentation. I mean you captured a lot of the essence of the argument in support of this project. I want to first of all shamelessly steal one of my colleague Councilmember Rocha's analogies, three legged stool. I told him in advance I was going osteal it. The three legged stool is is the project supported by planning? Is it -- has it been approved by the Planning Commission? And is there any neighborhood opposition? For this project, it meets all the requirements of that three-legged stool. There is not an overconcentration of alcohol in the adjacent census tracts. It is not a food desert. In fact within a mile and a half, there are seven grocery stores that sell fruits and vegetables, including a sprout. There's so many fruits and vegetables in that area that I have dreamed sometimes of being chased by a giant cabbage. So it's not an issue. It conforms with the concept of urban village.

>> Councilmember Rocha: That was not mine. That was all you.

>> Councilmember Jones: No, that was not part of the three legged stoolt. It conforms to the concept and the vision of an urban village. The economic model for being able to afford to do those kind of upgrades includes alcohol. So without that we're not going to see the benefits of being able to have those kind of upgrades on that corner. And I also want to just go back to the fact that the police department raises as a neutral. And I understand you know the desire to make sure that there's not an over concentration of alcohol in the area. I understand that we want to avoid issues of crime. But we should not have a one size fits all strategy for this. And that -- and I'm very familiar with that corner. I'm very familiar with the neighborhood that is around that area. I'm very familiar with all the shops, stores and establishments that are along Saratoga. And so I am very confident that having your gas station with the ability to sell alcohol, is going to have a positive impact on that street and in that community. So that's why I'm supporting the recommendations of staff and I want to make a motion to approve rezoning that property with -- including staff's recommendation for you to include enhancements on the street facing Saratoga that will be more in line with the urban village vision.

! 56!

>> Second.

>> Mayor Liccardo: There's a motion and second. Councilmember Peralez.

>> Councilmember Peralez: Thank you very much. I'm just excited Councilmember Jones mentioned a cabbage and not a twinkie this time, if anybody remembers that one. I signed on to the memo with Councilmember Jones. I'll keep it real brief. I shared the same thoughts that I had shared in our last meeting. I think this does meet Councilmember Rocha's three legged stool model which I like as well. And I see no issues in this regard. I strongly support it and this isn't the -- not always will it meet this regard, as Mr. Robinson knows, there's an issue of a high concentration of a rotten Robbie I would love to see redone in our district, I don't think that falls into line, that one I may not be in support of but this one I'm in support of and I appreciate the work done by staff, by planning, by Mr. Jones, I look forward to this rotten Robbie being redone.

>> Mayor Liccardo: Councilmember Khamis.

>> Councilmember Khamis: I too am supportive of this project going forward. For everything that Councilmember Jones said and Harry. Quite frankly you know, a lot of the grocery stores are getting into the gasoline business. We're not restricting them from entering the market segment and competing against the classic role. We're only tying the hands of the classical gas station in this matter. So we're unduly tying the hands of gas station owners because we are allowing Hsueh for example and Costco to sell gasoline. So it -- in fact I hate to say it but Costco sometimes is a little cheaper than rotten Robbie, I'm a dedicated customer for rotten Robbie. We are allowing them to eat a lot of their market segment but we're not helping them compete. So that's one of the main reasons I want to make sure that these guys are on at least somewhat equal footing and quite frankly this is not going to be the entire store. I looked at the square footage and it's a smaller -- the alcohol section is not going to be the entire store. It's a fairly large store, is it not? How many square feet?

>> 3200.

>> Councilmember Khamis: 3200. That is a fairly large establishment. How much of it is going to be devoted to alcohol sales?

>> Harry Freitas: We calculated it to 9%. We didn't use shelf space, we have used square footage. The way they have designed the store she have a room they can lock, one door, so that is actually exaggerated.

! 57!

>> Councilmember Khamis: I have been in some of these facilities that do have -- like -- like -- larger selections of different things that you can purchase. More like a 7-eleven convenience store. I am supportive of it. If we will not allow gas stations to compete with grocery stores, we shouldn't allow grocery stores to compete with gas stations. Thank you.

>> If any members of the public would look -- would like to speak?

>> I voted against this last time. I was planning to vote against it this time. But I am, I am going to vote for it. And it is because I don't think they're all equal. I did drive by this. I went into, in, when I went across town. Took a look where this is located. I am convinced that this meets the test of -- of being able to -- to support it. That the planning commission supported it. The staff supported it. And -- that it is -- it is, four of the five findings are within, within, the parameters i supported. If it was not. If it was in a different neighborhood. I voted no on almost all of these. I did have the list of the ones I turned down. That would be handy to see if an of those were similar to this project. But I do think -- you know, i am, I am not, wildly excited. It says public necessity. Don't think there is aness ses -- is a necessity. If you look at the word necessity. It is hard to turn this down when you look at the things it does meet. I will support it this time.

>> We have several members of the public who would look to speak. Erin Robinson graciosi, forgive me if I mispronounce your name.

>> Hi. I'm esmerelda de campos. I am the store manager. I want to tell you about the response, after the reopening of the remodeled store. The old facility had a small store, fueling was rebuilt. 3,200 square foot store was built on the back of the property. Our store is similar to the pro posed store at Saratoga and Williams. Sorry. We completed construction and opened in January. Some of the comments we received from the neighbors were "it's about time." The Eastside need more upgrade like this. It is nice and big. Now it is a one stop store. They did a great job. We are a neighborhood store and the response of the community and our customers has, has been overwhelming positive. They're concerned about, concerned about vandalism in the city. They want me to keep it as well maintained as my crew and I have done. I have worked at five, I started as cashier, promoted to assistant manager on tenth and Julian. My first manager on story and Jackson. On the Eastside. And then willow Glen, Lincoln avenue.

>> Thank you very much.

>> I'm sorry.

! 58!

>> Thank you very much.

>> Thank you.

>> Ms. Robinson. Erin Robinson.

>> You did well on graciosis.

>> Thank you.

>> I have been involved in a strategic initiative. Our goal was to look at our entire offers and improve it across the board. It has three parts. First improve all aspects of our design. This involved going to an outfitted design firm to look everything from logos, colors, graphics we want to look better and more consistent. Second, expanding and improving our store sales. We want to provide a convenient place for customers to get the products they want. In order to do this, we need to be able to build a large enough store and sell products in all of the key categories. Third, to rebuild existing, existing sites and new facilities. Rebuilt sites need to be designed well and look good to provide value to customers. If we simply put up new paint, our logos on old facilities. It doesn't cover --

>> Thank you, ma'am.

>> That minute goes fast.

>> It does, doesn't it.

>> All right.

>> My name is riley Robinson. Part of the fourth generation. I help oversee the store merchandising and marketing. A key core product. Kidded a core product. Consumers expect, a planned product. Consumers come to the story knowing they're going to make their beer purchase. In the past couple years, craft beers have become extremely popular among consumers. Drink better beer not necessarily more be expanneding our craft beer offer to stay current and fresh. We have added products, speakeasy and 21st amendment. We believe that focusing on offerings, microbrews, brings in great customers. We stock a wider, offy -- of yogurts, coffees, teas, we offer more variety and increases our brand of market. Having more variety and options is an important part of a strategic sales initiative.

! 59! >> Thank you.

>> Little historical perspective. One of the greatest mistakes the hammer administration ever made, allowing beer and alcohol sales at little gas stations. If I wore you, you would be well advised to allow the rezoeng for the store to rehabilitate itself. But for all of the new gas station type little markets, forbid alcohol sales. Let's face it not everybody, just comes in there and buys a couple six-packs to take home. A lot of people coming into the cheap gas places, soon as they leave the place or while they're gassing up, pop a little brewski. When I see all the family members coming done here makes me think I should run a public record chance on the form 460 to see what other influence is there. Thank you.

>> Okay. Councilman?

>> Yes, thank you. Well, I was able to talk to, the planning director about this. I think I am pretty sure I wrote the darn thing when it was first -- proposed to the council that was, absolutely ban the sale of alcohol at gas stations. It was a believe probably sweeping the nation. Had to do with mothers against drunk drivers. Just the right thing to do. That was then. This is now. So, I am going to support this this time. Because -- our planning director did extra work. Mr. Robinson did a whole lot of extra policy work on this. I think it is appropriate in this case. Note to the council we have a brand new one in district four. It is gorgeous. I went in there Saturday. I only fill my gas there t it does not sell beer and wine. And I asked the -- the clerk how was business. She said it's good. So I, I'm just wondering why that doesn't have beer and wine? And it is doing very well. You don't have to answer the question. My colleague. This doesn't mean that every one, every gas station has to allow alcohol sales. Because it is done depending on its location, without, without beer and wine and so I am, grateful it is not there. As to Mr. Wall, I believe you referred to me on the day I was appointed, as not just antiquity, the withered remains of political antiquity. You have lightened up on me today, thank you.

>> Touche as they say.

>> I think I still remember there is a motion on the floor. Unless some one else would look to speak.

>> Oh, yes.

>> I just want to clarify. The motion -- council member Jones, it is the item a is the clearance, negative declaration included in the motion, approval, and, or adopting the rezoning. Both, both final ordinance and the pd permit will come back on consent in two weeks if it Is approved.

>> The other reason I Am supporting this.

! 60!

>> We have 17 minutes until the flag raising. We are going to do what we can to maintain a quorum. We have a lot of matters going forward. We will vote on this item. All in favor. Aye. Any opposed. Two opposed. All right. That passes. 9-2. Or -- 8-2. Something like that.

>> Who is the second now?

>> Myself.

>> Okay.

>> Councilman and myself. Item 4.3. the 101 oakland-mayberry. Yeah, we have a brief presentation. This item is recommended for approval by the staff and also, recommended for approval for you tonight by the planning commission. By way of background. The next slide. Developers of the flea market site received approval for August 2007. This allows for the construction of over 2,800 housing units and square feet of industrial uses. The U.S. 101, Oakland/mayberry transportation development policy adopted in September of the same year provided for improvement of U.S. 101 Oakland road interchange and construction of new interchange at mayberry road. Transportation development policy was amended in 2009 to bring the flea market lands into the policy, into the policy area. The original approval of the flea market zoeng requires the developers to construct improvements at the Oakland road interchange, estimated to cost $16 million. The '09 amendment to the transportation development policy allowed city to use flea market mitigation funds to construct either of the improvements at u U.S. 101 or new interchange at 101/mayberry. Both have been in the regional transportation plan for ten years. Original psr in 1990 for the mayberry interchange. I will turn it over to Paul Smith who is the -- the assistant, excuse me, deputy director of Department of Transportation. And like to point out, joined by the deputy director of public works and, our transportation director, and turn it over to Paul to explain the changes proposed are. The slide shows the two interchanges. Interchange to the right. And the interchange to the left is the existing 101 Oakland interchange. And it would be improved. So the policy effects -- the improvement, the construction and, improvement of those two interchanges. The next slide shows the same system. You can see 101 at the bottom. And the, highlighted area in blue. The flea market site. And just to the right of it, the B.A.R.T. station. We are before you today with the amendment to the poicy which was approved and modified to include the flea market. We are simply here to realign the flea market schedule of mitigation payments with the schedule for the U.S. 101 mayberry interchange. And also the development phases of the flea market site itself. Harry mentioned in the original approval of city council in 2007. And also in 2009. That the flea market was -- was required to -- contribute $16 million in traffic mitigation to help fund these improvements. That is unchanged. And that number of $16 million is inflated. According to the engineering news record

! 61! construction costs index for San Francisco. For whatever time period that this project evolves in. Other very minor changes to the policy update, the amendment, are that the cost of the interchange improvements have been updated according to, with our source being the valley transportation plan 2040. In 2014 dollars the cost of both interchange, improvements. $80 million. The finance plan has been updated by source. Based on original approval by city council. So there is, $36 million of the $80 million is from the traffic impasse and mitigation payments. $35 million would come regionally and $9 million from city. The city share of $9 million is covered in mba, number 1, which is prepared and before you, part of the package. That $9 million would come from -- $4.5 million. Half would come from the building and structures, construction tax. Collected from the interchange area. As it develops. And the other half would come from the North San José development reserve. And I would simply mention, the North San José develop. Plan, as many of you should know, has various transportation projects that are needed To mitigate the development of North San José. Traffic from North San José, actually would use these so the contribution of $4.5 million is consistent with that, that document. That concludes our presentation. We are available for questions.

>> Thank you, Carl. Thank you, Harry. I have submitted memorandum recently. We had conversations with -- with representation, developer, here now. That memorandum, so everyone had a chance to see it. Dated June 2nd. Recommend approapproving, staff recommendation, stages, 2 a, c, and 495 units. Subsequent. I know they're under construction. To come back to council. And will be taking a closer look at this, if this is approved. There are two members that would look -- like to speak.

>> Good evening, mayor, members of the council. My name is eric shaynauer, representing flea market land owners. And thank you to staff bringing this to council today. And wanted to distill it to the simplest statement what it is the we are really adjusting the payment schedule. Thought we are doing here. We are comfortable with the staff recommendation. And future considerations the may your put in his memo. We worked for 15 years, cooperatively with city, vta and the community to design and now implement the transit village that will support the areas of B.A.R.T. station. Community is a key part of your consideration tonight. I want to make it clear in approving this it does not change any of the project whatsoever in terms of of what the community expects. So, the project development that we are doing on the, on the flea market property. Remains -- design, in the early phases, as, as the community has the seen. Ltd transportation projects. Freeway interchanges are ones shared with the community multiple times. I have been in front of the council so many times sharing the project with them. Many think I am a member of the group. I want to make it clear tonight is just about -- shifting how our $16 million gets paid to city. That's it. It changes nothing on the ground, or in the community, or, or on the project. So, we hope that you will support that so that we Can advance the project, seamlessly forward. Thank you.

! 62! >> Thank you, sir. With reference to where mayberry turns into East Taylor street, i would like to see a tasteful art project over, arcing over the road, that in three languages, would say -- abandon hope all ye who enter here. Because this traffic issue. From district four yesterday. The interchange and how it will affect it. I for one know this will go forward. Just another reason for me New move to a rural area and just say, well, I used to live in san José. But go forward and think of this sign. Because the -- it's going to, it would relieve some tension just to warn them. Thank you. All right. Questions from colleagues, council member? Mayor you may recall. I heard from what he was stating and concerns from the community in district three. That will -- that will be affected by this. I did want to ask -- reaching out to you to schedule a briefing to understand a little better and then as well, maybe from, city staff. To get in line with this, I'm in favor of, of what it is, that our mayor proposed in his memo and understanding the money and how it will be Al located. I definitely want to stay on top of this. Concern and regards to, To myself being caught up to speed. On all of the work that has gone in, and then continue to be an advocate for the community there. I will keep it brief. I know we are short on time. So I will make a motion to approve -- the memorandum put forward by the mayor.

>> I think the councilman may have a word to say.

>> I am fine with this. I need to be brought up to speed with the flea market issue. Which I have not been so far. I support the plan.

>> Okay.

>> All right. There is a motion and a second. Any other comments? All in favor? Any opposed? All right. Of those present. We still have a quorum. That is approved. It is now 5:54. We have a flag raising scheduled at 6:00. We are going to lose a quorum. I propose we return after a very, very brief recess. We are going to return at 7:15. I'm sorry, 6:15. Forgive me. Boy, did I say 7:00 it? Is getting late. I meant to say. We are going to return at 6:15. Which gives us enough time To raise the flag and say a few words. Councilman.

>> Mayor, just wondering if any body was here? We have an item, but I have a feeling we may have lost them. Is anyone still here?

>> Okay.

>> My regrets. We are recessed until 6:15.

>> Our meeting is resumed. On item 4.3, I believe. No. Got the funny look from Sharon.

! 63!

>> Hoping it is 5.1.

>> I sure hope so too.

>> 5.1. parks recreation cost recovery fee programs audit. Sharon. Take it away.

>> Sharon from the city auditor's office. We have audited the prs active tee program. I am going to keep this very brief. We believe there could be clearer accounting for the fee activities. We are recommending improving the fee setting process and tracking cost recovery for individual recreation classes. And we're recommending that prns continue to improve efforts to, to, improve -- continuous efforts to improve afford bulk access.

>> Mayor, council, director of parks, recreation services. Sharon mentioned we do concur with the findings. We are well under way in terms of actually implementing some of these especially, in the area of -- really enhancing our scholarship program making it robust and making sure we are ensuring affordability and accessibility for all San José residents. So -- if there is any questions we could take those now.

>> Okay. Questions from the council.

>> I know, you want to speak at this time?

>> First of all. I want to thank Sharon for the audit. I'm sorry. Discombobulated. I want to thank Sharon. Some one here. Maybe a lot of people have commented on the audits how they love the audits. Until, until -- I started serving on the council. I didn't like audits. I didn't like your audit. So I especially want to thank you for this audit because it just happens to be, the area that I am, particularly interested in. I think that the programs that prnf provide and the services they provide add to quality of life for all residents. But especially for the residents in district five. This adds to the quality of, of the everyday life. I appreciate the work that you have done. And you have some very interesting findings that I just wanted to, talk about. And, I addressed it in the memo. So, thank you so much, Sharon. So, Susan, angel, I wanted to talk about briefly -- briefly, i don't know briefly. That's a -- too late for briefly. Okay. A couple of things. I wanted to just address the scholarship program. They are starting to revamp that. Recommendations in the audit. I wanted to make sure at some point we come back and we are looking at hopefully coming back. My recommendation that's we come back in the fall. To take a look at how you are going to revamp that. How one you are going to make sure that, more folks are, are made aware of the program. I am concerned that -- it was underutilized. I don't know if because,

! 64! not many knew about the program. Not many understood the program. I know that there was some findings in the audit that i just want to really make sure -- it is accessible. Especially, as you know. Some families in the community, benefit from this. Now let me tell you, why for me especially this is of concern. I am going to start sounding like a broken record. I am going to repeat myself. This is the first generation. That we know. That is expected to not -- to not -- outlive their parents. And it is due to chronic conditions such as diabetes, high blood pressure, and high cholesterol. And obesity. This is the first generation -- that is expected not to outlive their parents. We need to make sure for families who have scarce resources, limited resources. We need to have a way of supporting them. Getting them active. And instilling the value of an active lifestyle. And we have within our power, the ability to do so. And we are really excited about. Opening up the field. Partnership. And exciting things that for me, really provide an opportunity we can maximize. We are looking to see how we can extend our program and access to it. I wanted to talk about that. Want to mention something before I go on to the next bullet point.

>> Councilwoman. Thank you for the feedback. Actually we concur. Part of why we exist as a department. To provide those opportunities. I think you will be pleased to know. We didn't wait until after this meeting to start implementing changes. As of April, we made significant changes to our scholarship program. For one we increased the ceiling on our scholarship. Giving more authority at the site level to make decisions before these were all centralized. Here through City Hall. That is no longer the case. People are making, in real time situation, a decision around expanding the all. Money to subsidize our scholarship programs. Work with family foundations. Last year we are pleased to report that we, we have, we al located close to $400,000 in scholarships. Scholarships tied to fees, on the low side. The amount of money tied to frankly, you know, bureaucracy. That is mixed. And right off the top. Take $150,000 and provide summer camps to kids in hot spot areas. Zero cost. The mayor was in strew mental in -- instrumental in getting the money funded. We are on our way. We will continue to work hard in this area. We are in receipt of your memo. We concur with this as well and feel coming back in the fall would be a good time line to report out on our progress. Thank you. From the conversation with your staff. Suzanne. Yourself. You are very committed to the children in San José. You really have a very thorough, solid understanding of the need of those areas where, our children are really, really lacking and where the families are really challenged. I really appreciate that. Trying to access the families. Get them in. Get them excited. And get them involved in the activities. So, I am really glad you are moving forward. You are not waiting for any direction. And for the community swimming pool. My staff brought it for me. Which is great. I like the hours. But something that I am just going to recommend in the future. You have programming. I want to make a recommendation. Some of the things that you do start thinking about. You have rec hours which to me, I just want, I want to be able to partner with you. Because I, i-i want you to use me and my staff who liven the community and who, who, work in the community. We are there constantly in the community. If you were to have

! 65! moves the hours of the swimming classes a little earlier. Moms, stay at home moms, have ability to take the kids to swimming classes you could have extended the rec hours a little more so for the kids who are at home. So that kind of stuff is what i am hoping to partner up for next year. Next year. And, help the kids get into the -- I know that I went and had a swim at the community center. Spent, six seven hours. At a time in the pool. Learning how to swim. And then in the rec hours. So it's -- the community center pools are so important for our community and especially. We need to make sure we get those kids in there. And we teach them how to swim. I just wanted to bring tight your attention. I don't want to get into a programming. Because you know better than i do. I just want to be able to help you. Some of the need the community and kids have sitting in the summer. They're not active in the camps. How to get them so they can use the resources we have in the community. Then lastly. I think it is point number three. Is there a a way of determining how to further reduce the fees. Thank you for that question. And we are -- do have ability tie right now to do further reductions with the new proposal going up to $400 per person per year. We are clab rating. And those worth $400 scholarships you were talking about?

>> Correct. Goes up to $100 per person, per year. Its now up to $400 per person, per year. The last question, actually. On page number -- sorry. I don't know where it is. But in the audit. I know that you had mentioned it to me. If you can just, briefly -- go into your -- your explay nation. Explanation. As to - - as to why the -- enrollment of preschool declined in the mesa area? So the area for example. That is a good example. An example of a community center that really requires. There is really high need need for subsidized scholarship programming. And what we have been able to do, we have been able to work with different family foundations and funding sources to actually fund those programs. So what we have, what we have, what we didn't have, well, let me back up here. Look at our registrations. You will find reduction prin school participants -- preschool participants in the program. We serve them through partnerships. We had $500,000 grant through first five. They fully subsidized preschool. Weregister in our rec system. We provided service. In the books. It looks like a reduction. How we book the transacts. What we plan on doing going forward. Tell the whole story. Not just the fee activity story. But the overall impact that we are having with all fund. Not just the activity fund.

>> So for our kids in the mesa area, still being served in the preschool classes.

>> Absolutely.

>> We do need to be able to capture that information and that data. And again, I, and again, I said this before. Again, a broken record. But we know that in the unified school district. Kids entering kinder, that means by the time they go into kinder they're already on the treadmill. Where they're on the treadmill trying to catch up. And when they jump off the treadmill, they're standing in the exact same

! 66! place. Whereas their counterparts have moved. You know, miles and miles ahead of them. And so, if we don't have that data to capture that information, I think it is just -- does us a disservice. A way to capture that info and know that we have been serving the kids and have been helping to, to, to, build those, those, connectors and those synapses, i think we need to be able to show that we are providing the services.

>> Okay. All right.

>> Would you like to move your memorandum.

>> I would.

>> We'll entertain motions.

>> I would like to move my memorandum.

>> Second.

>> This motion is second. I will support the memorandum. I enjoy, we talked about this, and, seems like every year, i wondered about the same thing. About the scholarships. I know you guys are doing great things. Sure you are streamlining them. Sure the changes you are making are going to improve the situation. I just thing it's -- really difficult task. And I think ultimately, we are going to get to the point where we are going to say, let's just reduce the fees. And, low income communities. And make, reduce the barriers. I think no matter what you, do it is going to take us a lot of time and energy to get the word out about scholarships. Do so in multiple languages. Requiring documentation of a lot of families a lot to ask. If the government is asking For documentation. I think our time is better spent serving our residents. I absolutely support the councilman's memo. Look forward to learning more as we go. See if the changes have an impact. But I suspect we might be back here again next year. And I hope, if, if, things aren't measurably improved. We'll be thinking about let's scrap it. Let's just reduce the fees. And those communities, where we know those are our barrier. Because -- you know, the most expensive community center. Most expensive pool to operate is the one that is empty. The one that is undersubscribed. The program not being utilized. And -- you know, when we can get the community centers full. We can think of revenue opportunities. I am sure. Right? We can be selling food. Doing all kind of things. But -- when folks aren't showing up because, because they just hear there is a fee. And they're not going to take that additional step of checking in with mom to see if mom knows if there is a scholarship. I think we would be much better off. Reducing the barrier. I understand the council imposed this restraint on you with the fee recovery model. At some point you should come back to us

! 67! and say uncle. Let's get rid of it. Move forward. Different approach. I want to thank you for your work. I think more can be done as well. I want to thank you for -- taking on a pilot on -- on doing kiosks. I think that could potentially lead to, cost recovery model. I want to thank you for what you have done reducing the cost for organizations that, that, actually volunteer at parks. So, I know -- when I was on the neighborhood services commission. You guys -- did that. I really appreciate that. Because -- further. I wanted to make sure that we all keep looking into ways to streamline. Especially the booking of -- of park benches or what, what, you know, picnic areas if you will. I'd like to see an online system. People put their credit card on. Tell the ranger. Ranger gets it on their pda. Hey, this is -- X, y, Z. Park -- park reserved for, for, such and such birthday party. Takes a lot of mistakes offline. And also, reduce, reduce cost for us. In the long run as well. But it, I want to thank you for all the work that you have already done. Thank you, Sharon. Also for her report.

>> Councilwoman?

>> I want to thank the staff. Being part of the council that put the burden on you because of great recession. I think you guys did an incredible job of trying to keep the wheels on. When you look at exhibit 6. And look at some of the costs. The lou Cunningham skate park had a goal of 100% cost recovery. Projected estimates were 100%. And the costs recover estimates for 100%. So, there is a lot of success in, in the model. And I just want to highlight some of that too. In, I don't want this moment To go by without at least -- acknowledging some of great work that's been done. It helps subsidize the program. I think collecting fees. And having cost recovery. Very important. That was your goal. That's incredible number. Parking. Gefgt parking. Receiving that revenue is, is making Cunningham sustainable. So, rentals,reservations. 100%. What you projected. What you are achieving. So there is just a lot of a goodness. And, happy, hollow park. Just want to highlight this. Really good stuff. In terms of greater access. I seconded the motion on the memo. I think looking at the auditor's report. And classes. I do think we should look at what we are supporting. And more participation. The best thing. Looking how people had to qualify for the scholarships. It's pretty significant. And, most of it, most of the young people going there on the lunch program. A lot of the schools are. Qualify you without much else. So, without having the forms, i think we know, schools identify. They know what -- I think we could greatly simplify the process. Illuminate the scholarship aspect for a lot of the things.

>> We'll support other at risk youth that can use Cunningham in other ways. I want to see day camping, maybe overnight camping for at risk youth at Lake Cunningham. The way to pay is to get funding from other sources. Last time I checked. We were not rolling in dough here. We need to keep the cost recovery going. And support the motion.

>> Council member.

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>> Thank you, just a couple things that I forgot to mention and forgot to ask you. Ones I wanted to ask you, How are you doing your outreach to get the word out about the scholarship? We have a strategy. Working with our other partners. And the neighborhood. And really is a real grassroots type of approach we use. When you think about it. And the marketing team. That really speaks to the, to the work -- of the staff at the center level. Kudos to them. Heck of a job connecting with community. The feedback we received. Excellent feedback. Retrospectively. A strategy that helped us, really -- keep valuable services. Keep from losing valuable services. Keep community services open at a time. Everything on the verge of closing. A strategy that helped us get through what I call the dark years. Now that the economy is changing. So should this model. We will continue the model. How do we figure the balance, between, effective cost recovery that work. That we can offset the general fund contribution and make sure no residents get left out. Make it easier to serve our community.

>> Okay. You have a -- an income graph or eligibility graph we can use when we are talking to families ourselves.

>> The easiest one we use. Basically, if you are on free or reduced lunch. I mean, basically the criteria is flexible. Basically, quite frankly. In some cases. A situation where somebody says, yeah, I'm low income. We'll take them on their word. Don't want to give them the impression. A long, bureaucratic application process either. Nonetheless. It does take the extra step. There is also sensitive tee off plague for scholarship too. There is also sensitivity of playing for scholarship too. It's, I would look to enroll my kid in camp. Our staff does a good job of trying to facilitate that transaction. I think the feedback we are receiving to day. We will go back and push the envelope on this issue and make it even easier than that.

>> Then on page 4 of the other audit report. Exhibit 5. I am really curious, it's -- it is enrollment recreation classes by site. Why do you think mayfair is second to the lowest enrollment. Of all the sites. This is representative of the active team of the classes. There are partnerships, nonprofit throughout sites. Only represents a sliver of the activities. And there are many more partnership organizations we work with throughout the community that offer esl classes, programs, services, many are free. So again, this is representative of just the sliver of the active -- activity component.

>> Children's activities are free.

>> I have a list.

! 69! >> At mayfield, organized sports. Organized team. We have soccer. We have, basketball leagues. That we also, we actually use, the center. Take kids over there. All those are basically offered free. You are not going to see those offered through the fee activity. So when you look at, when you run the data on the graphs, what that is going to generate is a fee activity report. At mayfair we subsidize and provide the fee programming.

>> Of also doing their activities at mayfair.

>> Great. Thank you.

>> I actually did look at that same chart. There 'tis an inverse between income of and the surrounding neighborhood. And mainfair toward bottom. It's gone on, apparent what has gone on the we have work to do. I know they're doing an enormous amount of work trying to outreach. But we, we have barriers to overcome. Okay. Any other questions?

>> Yeah, to follow up on what councilman said. In the first paragraph, right above looking at the graph. I was looking at that too, in terms of, how it is utilized. I guess, in the intro, it says, recreation classes. And it describes offerings are diverse. Include areas, preschool, dance, music, health. Fitness, gymnastic. Thelters. Is preschool one of the areas where the partners provide it. I guess I am getting back to the exhibit. It still isn't right. It's done here further.

>> Preschool is offered at each of our hubs.

>> It is a fee activity. What we have done in some communities, mayfair, seven trees, hank Lopez. We would run a preschool program there. We would subsidize those via these other partners. We would provide it. Not as a fee activity.

>>-up are saying at mayfair. Though preschool is a fee activity. It is subsidized at mayfair.

>> Subsidy for all preschool. For some one on ssi, or, any of the, any of the simple ways they can show that they have, a need. They pay $42 a week. Need a deeper subsidy, a way to do an extreme hardship case.

>> Still one of the fee programs at the preschool. You guys want to take a look at to expand it. I think preschool is within of those things where we really need to make sure that whatever program we have we, have as much access as we can. And as few barriers. So I really strongly -- support my colleague on that. And especially, you know, in, in the district where we are seeing this, not as much participation.

! 70! Because the it does sound like they're, there may not be a big barrier, but we need to do more than, just need to open it wide open and increase enrollment.

>> Okay.

>> Thank you, I would look to thank our auditors, as I usually do. We need another rose garden to shower them when they walk before us with rose petals for all the analytical work. I am not going to analyze the parks department. From a procedural standpoint. Departments blow the audits off and don't complete them and do what the auditor tells them to do. Though they agree to follow through. This should be looked as a performance marker on their tenure on their high paid positions. If they fail to perform within a certain amount of time they're not to be chastised they're to be fired with prejudice. I will speak without charitable, about a department, about a previous audit yesterday. Think abut this. This has to change. These auditors are highly paid, dutiful, exceptionally intelligent. When they turn over their findings. The morons that don't produce, the morons have to be fired. Thank you.

>> There is a motion on the floor. All in favor.

>> Aye.

>> Any opposed. That's unanimous. We move on then to item 5.2. actions related to communication, master plan. And thank you. Yes. Council member, recusing himself. Sharon. Thank you for a great report. Thank you to your team, I should say. Thank you, angel. For all of your help. All right. All right. Well, hello again. Angel Wilson. Director of parks, recreation, services, joined by the interim deputy director. We are here recommending your approval of phase one. Communication, two, part master plan, turnkey park land agreement with K.B. homes South bay and mt properties. This project truly has been a collaborative effort. Thank the homeowners association there is at the property. K.B. homes and their staff. Consultants as well. And city staff. In addition to our own staff, did great work on this project. Department of Public works. Department of Transportation. And the parks and recreation commission as well that played key roles. This proposed project. Exemplifies the place making efforts. In a nutshell. Phase one will consist of a new 1.7-acre park. A third mile of new trail that will, regional transit. And really, signature fitness staircase that should help draw people from the other staircase. We do have a detailed presentation. If you would look us to get into. If not. We could truncate it there and open for questions. Really your call.

>> Let me ask members of the council, not familiar with this if they would like to see the presentation. Thank you very much. Angel. Councilmember winn. There is a motion and a second. Any, comments? Looks, looks like a fantastic plan. And congratulations, council member winn, and thank

! 71! you to our developers. We're grateful for your, your great work. Okay. Unless there is any other question, I'm sorry. One member of the public would look to speak.

>> This is a great plan. But the problem that always consists with, with the communication held properties, the lack of enforcement by city to keep this nice place, this nice development, properly policed from a whole host of vandals and miscreants who invaded for a variety of reason. I would like some sort of financial instrument be created out of a portion of the money to funding ongoing permanent stationary security people, either be it park rangers or what have you. The main issue is to create a financial instrument, such as an annuity that would preserve this great development and, and, keep people's peace at mind. This whole, neck of the woods, is rife for problems. The city has been a little derelict of keeping the peace and quiet of people who invested their life savings to live there. Thank you.

>> Thank you, Mr. Wall.

>> A motion on the floor. All in favor. Aye. Any opposed? That's unanimous. Thank you all. We have more parks however. That's a good thing. Item 5.3. alvisio parks, improvements. Any presentation from staff? Okay. Council member Matthews?

>> Yes, because I'm hoping that we will come back in one week on June 9 in the evening. When the, the staff reports back on to just ask you if you are able to do that, June 9?

>> Yes, we are working with the Department of Public works on our work plan. We will be able to do that.

>> I will save a presentation for that. I do want to say this is an opportunity for us to -- match resources that are there as a result of my memo explaining everything. And it's team to rehab the mark. Neglected for many years. There are two parcels adjacent to the park. That were promised to the park. Never developed. Of what I am recommending a master plan. Quick master plan to incorporate the two parcels and, really, create hopefully, a sort of commons for the town that will face the town and instead of face away the town. And connect all of our civic facilities there. Thank you, mayor, for cosigning the memo with me. And I would -- move approval to ask staff to come back on items, one, two, three so we can have a fuller discussion next week.

>> Second.

! 72! >> Motion and second. Want to commend council members Matthews. Jumping in. I love the vision of a town commons. I think the community will embrace it. I have seen many have. I just wanted to add in terms of what we are looking at as we come back. I know there is an enormous sucking sound. It would be helpful to understand how long we expect that to continue so that resources might be freed up for concepts like this one. I think which are really important for residents in district four. What is on everyone's mind is how long it will take to get the money to make it happen. We will see that again in a week. Vice mayor. I just wanted to thank, council member Matthews for leaving a legacy. She left a legacy. Another important piece. I hope the council member who comes in after you Is appreciative of the work you have done. You laid it out all here. And I will commit. As long as I am on here to move that forward.

>> Thank you, that's what I am looking for. This council to commit publicly to carry this on. There is a good chance to raise money from outside the city. I know we can't do it if we don't have a master plan. This the foundation for future fund-raising hopefully and development of the park. Thank you.

>> Agreed.

>> Two members of the public. May have outlasted. Dick santos. Don't think he is here any longer. The weather is going to change. If you haven't noticed already. Torrential rains could put this park under water if you do not take prudent steps now for flood control. By putting the appropriate pressure on the Army corps of engineers, and the water district, to make sure the silt is removed so the creek and the river can discharge easily into the bay. A lot of develop. Since the last torrential rain. Importantly the housing. And more importantly, ninepar, recycling, and the residual management area from all that B.A.R.T. dirt you put out there, create aid de facto levee and water has nowhere else to go. It is foreseeable it could be an underwater, artificial reef if you are not careful. Pay attention to the flooding issue. Take the necessary steps. There's a motion on the floor. Any other questions. All in favor? Any opposed? That's unanimous. We are going to skip 7.1 momentarily. Go to 7.2.

>> Welcome. Good evening. We wait for the presentation to come up. In the meantime. Let's get started. And our assistant director of esc. Joining me for the presentation -- Jay witherspoon from ch 2. Our technical expert. Bruce petric of nwh, our expert on biosolids. And Kay Romeno, director of esp, and we are going to talk about the biosolids strategy today. In November of 2014, presented recommendations to the council. Council had approved two of the recommendations and directed staff to perform additional analysis. Requested by tpac. We are coming back to you with that additional information today. So we are providing you with an overview of the current operations, prior recommendations, as well as, the additional analysis performed since late last year. So I am going to hand it off to Bruce to walk-up through an overview on biosolids.

! 73!

>> Biosolids. Biosolids are sludge residuals from treating waste water. Governed by the, since 1993, by U.S. 503 regulations, define level of pathogen reduction, level of treatment and final disposition. The rate, created different classes of biosolids. Heard about class a, class b, class a essentially level of treatment that is required. The amount of pathogens required. The metals content. And final disposition and record keeping. The current biosolid, current waste water facility. Split into the liquid treatment and solid treatment. And focus on the solid blocks of those. I'll go into the background. The, the, overview was built mainly in the 50s. Upgraded in the 60s and 70s. And so, a lot of facilities need a lot of infrastructure rehab. This figure shows, a site map of the overall facilities. Very large site. You can see regional waste water facility. South side. Also, active sludge drying bed. In the central portion of, 2750 acres. And the island land fill. Currently go to on the North side. You will notice on there, they were used back in the 60s and 70s for sludge storage. And since then hatch not -- have not been used. Lagoons delineated as wet land. Use of lagoons would require significant mitigation. Current biosolid facilities, the backbone of the process, the existing digestion process. Digestion essentially its an enclosed process, that state licenses of biosolids, reduces pathogen and odors. And it produces a methane product that is used to produce power and heat. Very environmentally sound process. After the digestion process. The sludge is pumped to the sludge lagoons. Showing the picture. After three four years they're dredged from a lagoon after further stabilization to the drying bed, solar, wind drying to produce a dry product that is, periodically hauled off to the adjacent land fill for alternative cover.

>> Thank you, Bruce. Between 2008 and 2013. There was extensive work done on master plan comprehensive planning document to guide infrastructure improvements and land use decisions at the waste water facility. The plan, master plan took into consideration and direction of council in 2010, the guiding principle. One of the most significant recommendations was biosolid management plan which include a transitioning out of the open air biosolids in lagoons and drying bed as Bruce talked about. And so the key drivers for this reducing the footprint And enabling other land users given the potential of the island, looking at options, positioning, diversity options, and, future changes in markets And regulation. Our staff report include, details about the different discussions and policies of action. Which is outlined in attachment A. This shows what was envisioned in, in the planned master plan. The key elements included the sludge digestion, that Bruce talked about. Mechanical dewatering. And then basically different method of drying out the solids with a variety of disposition options. A mix of class a, class b solid. Thermal drying. Green house drying. The rest envisioned going offsite for composting and other applications.

>> Instead of the type of digestion we have right now. We recommended moving forward with of a different type of digestion which would give us flexibility to go to class a biosolids, cost effectively. With addition of those which are shown with the dashed line. It would give us all of class a, biosolids. In the

! 74! meantime. Class b biosolids. Would go offsite to be disposed of. So back in November. In front of this is because we had done a market survey which really didn't show any imminent drivers to move forward with what is pretty expensive capital investment in the dryers. You asked us to come back with some additional evaluations related to order, and other alternative options which is what they're doing today. So analysis that we perform, basically to determine the offside order and, current operations. And started out with 30 options down to 14 different ones for preliminary evaluation. And then a more detailed analysis, three options. And also looked at other considerations such as the timing of the land fill, whether that would impact, sort of the recommendations, and, as well as implement station time line. And then -- alternate sites. And I would hand it off to walk you through the impacts. The study is based on odor sampling and, modeling since 2010 and include consideration for city council's selected acceptable community based order threshold levels set last year. This site has the two main points. The first is the solid orange line, is what we are defining as, as the the -- the plants' odor fence line border. It will typically follow the property line in the Southern section where the council has deemed that area For development, we moved it up from the property line to match with the solid orange line is. Spotted orange lines are bun bun -- are boundaries the council would accept. And if they want to allow further development or type of activities to occur in the areas. The second point is -- the council's fine dilution threshold met at the solid yellow lean. Anything. Trying to keep the odor within the solid orange lines site. To make sure that we meet the, the council's threshold for -- for, 99% time of the year. That means about 88 hours a year, go across the line and be above the threshold level. The fine dilution of threshold member. Industry best standard. Set by waste water treatment plants in the bay area community. Currently the plant is in compliance with all bay area, air quality management district. Nuisance odors. Threshold levels. Have not received any confirmed, bay area, inspector odor violations. And this threshold community based standard set by the council should ensure that the community will enjoy outdoor life once we implemented odor control. The next slide, shows odor sampling results. This is all odor sources on waste water treatment plant emitting into the atmosphere. The yellow line is fine dilution threshold contour. Anything within the line is lower than, fine dilution threshold. Anything outside that, that 88 line up there. Is lower than the fine dilution of threshold. Anything inside that line is a buff the, the community based standard. You will notice there is a small area of noncompliance in the community between the orange solid line and the, the yellow line. We were asked to look at the drying bed. The line again is offsite odor impact. If you notice the direction. The direction of the wind is showing that there is, the odors are created during low odor events. So it won't follow the high wind patterns you will see going up and down. North and South. But that -- demonstrates that you are out of compliance from the solid orange line, by the, yellow lines. What would we do if we retained lagoons and drying bed. The first line, you see right there. The contribution of both sources. Have to be operated in tandem. That's the base line. We reduce the amount of area from the lagoons. 25%. You see the odor, contour line outside the orange line. And we reduced it by -- by 50%. And you can see that the, contour, the Green line is still outside the solid orange line. And

! 75! then we reduced the, area by 75%. And they see that, the blue line, resides within -- within the -- the orange -- boundary line. This means that 75% of the solid, the plant would have to be mechanically watered. The other 25% would be on those ponds. So, in lieu of that. We looked at what would be, if all, 100% of the sludge, would be watereden the dewatering facility recommend by staff, the solid yellow lean again are the offsite contours without odor control. Going through the dewatering facility. The red dot in the middle. The dewatering building with odor control. You can see the area is significantly decreased from what we saw when we had the lagoons and the drying bed. The red dot within the orange contours. Number of potential options were looked at to retain the use of lagoons and drying bed and reach odor reduction goal. That's the current operations, with lagoons and drying beds. And the operation with the 100% mechanical dewatering. As we said it over 30 options were, evaluated. And identified and evaluated in workshops. City staff. And the three were boiled down to three feasible options. Those are identified, as a, b, C. Option a is essentially existing lagoon operations. Adding high doses of chemicals. Typically, some kind of -- iron salt. Prior to, to the sledge going to the lagoons. That reduces the odor. Potential. Odor mission rates. From the lagoons and drying beds to bring, hopefully, in the boundary. Option b is -- 75%. That would go -- the sledge going to the lagoons. With 25% have to be dealt with, the watering. But this, action also include a water cap on the upper levels of current lagoons to try to meet the odor boundaries. Option c the one that Jay showed is removing. 75% mechanical facility. Bring the yellow line within the orange. This option, you are operating. Essentially two processes, the current process, also mechanical dewatering process.

>> From the five options, a life cycle cost analysis was performed. And those are lists in the base case. A, b, c, recommended option. We did a listing of the cost. With and without landfills. Annual costs. Midyear, design. And that present value. All costs are in 2015 dollars except for the annual costs. A point of a design period. It represented class five estimate. Plus 100%. Minus 50%. For planning levels. Recommended option. Capital cost. Construction cost of. 100% facility. Plus the decommissioning of the current sledge lagoons and drying beds. The sledge will have to be take in to a land fill or land application sites. It is higher. The net present value takes into account, all of these o & M cOsts, the capital costs. Repair, placement costs. Salvaging costs for the 30 year design period with a 5% discount rate. And you can see, it is a good, good comparison. Between options. Kind of normalizes all the cost factors. And range from $85 million to $290 million. The -- the breakdown of the, net present value, by cycle, I want to show you, the -- the what makes up that -- that majority of the, net present value for each of the options. You can see the disposition cost, labor, chemicals, makes up a large percentage of all of the options. You can see in the, the, purple there, the capital cost. Various options, b, c, recommended.

>> Thank you, Bruce. This summarizes the different options that Bruce talks about. The base case has the present value of course. It does not meet the goals. The other goals, as well as the the master plan

! 76! goals, option a which is the chemical pretreatment. Its the second lowest. Again, highly unlikely to meet the goals. And also requires a full year of piloting to confirm expected odor reductions. It also has a high on going o & M cost. Option b and c, a significant operational disadvantage. Also option b will require extensive. So a lot of capital investment as the well as three year piloting period. So both of these options due to operational complexity also option energy intensive. These are not recommended by staff. So as you see, recommended option does have the highest cost. But there are a lot of advantages to it. And again, we are going based on prior policy direction. And different goals that have been set by the council. So the recommended options, you can see, 100%, the decommissioning the lagoon drying beds. This presents the highest level of certainty in terms of meeting the older goals as well as the the other master plan goals and incorporates proven technology to improve goals and in alignment with how waste water facilities are processing and provide flexibility for multiple diversified disposition options and positions to respond to future changes in the market. Though this is the most expensive option. Such as the the deferral of the dryers and elimination of the large covered storage which is quite expensive. Done through the project validation process. So we have already reduced the cost of the total biosolid transition by $100 million. And then, we were asked to bring back considerations. Related to the closure of that. As the you are, right now. We have a contract. It requires, class b solids. The land fill has a permit. However there are provisions that would allow us to extend the term of the contract. Based on markets surveyed. 300,000, 600,000, depending on what we wanted to do. In terms of disposition. To go to different land fills. There are several land fills we could go to. So, given that, we don't feel that -- that the island land fill, either the closure or, whether it stays open is really that material. This slide shows anticipated time line for the dewatering facility as well as decommissioning of the lagoons and drying bed. And the schedule is longer than the one you have seen previously. However, for the previous schedule, the community looked at options to shorten the schedule. There was a forced sort of directed time line. And this schedule is, based on the design build delivery method. And time lines for a project of this size and complexity. After the facility is -- completed it will take five years to decommission the drying bed. And it did envision decommissioning by 2025. There were some question as but access. Formation, based on the distance. And we looked at our other all -- alternative sites. We are reconforming our recommendation to locate the dewatering facility on site A. And so these are the near term and long term recommendations that we are bringing forward to you to proceed with the watering facility, decommission, the drying bed and then also.

>> I just want to ask a quick question. I asked for information to come back about funding alternatives, including, community, district. Recognizing there are certain benefits that are, incurred by nearby property owners that are, not shared widely by all rate payers. I was hoping that information scan be shared with council, whatever is shared, I assume that would be the case. Is that right?

>> Yes, correct.

! 77!

>> Councilman Matthews.

>> Yes, I urge the council. Accept staff recommendation. I think it is time. After 50 years to come into the 21st century. I moon,000 -- I mean this plant is old, obnoxious, and, san José, seems to be drifting Southward. Time to do this. I think it is well worth the investment.

>> I think it was old when Congressman Matthews was on the council. So -- all right. Other, other, other -- other comments. Yes, council member?

>> I feel I need to make a comment. I was there -- just, you know, sorry, everything is kind of blurring right now. I was there a few days ago. And I, I urge -- anyone that hasn't been up there -- especially my -- fellow colleague whose have just been elected to the council -- it is -- by far -- most sophisticated, complex, system that I have ever -- seen and witnessed. And truly I think, oh, now i remember. It was right before the weekend. All I could do was talk about it during the weekend. And, any one that was tired of hearing me talk about the treatment plant. This was not the most exciting conversation to be had at parties, and, dinner. But, because I was so fascinated by it. And it was such a complicated system. And -- and, so I agree with council member Matthews. I, I agree with, the fact that -- that a population is, is growing, and, it is expected to -- explode over the next 20 years. And it, it seems like an antiquated system. Even though it's doing the job that it is supposed to be doing. And -- and I know that all of you are very accustomed to the, to the, the fragrance that it emits. But it was difficult to Be there. For the rest of us. But it, so it's nice to -- to explore the new technology and consider that weed into -- that we need to be good neighbors if you are dealing with what we are dealing with.

>> Councilmember?

>> Thank you, mayor. Want to start with hopefully an easy softball question. Biosolids, management team, a coveted team to be on and resume builder. Why does the council need to be involved in approving that? Is it just the budgetary come poen -- component?

>> We are not ready to make a proposal. I mean the timing was such that we didn't bring that forward as part of this budget process. So there will be positions and sort of what the skill sets of the positions and what they need to be, we'll work through that because there is the technical aspect of it and a lot of contract management, as well.

>> So these are new positions that are going to be shifted? Okay. But new employees or current employees that might shift over?

! 78!

>> New positions it could be going into those positions.

>> Okay, thank you.

>> Then the larger most difficult question and I kick myself for asking it because it could prolong this discussion. Out of all these reports that have come to the council and where we started and approved this from the beginning, the difference between the scope of the project then and the difference between the scope of the project now. And then the second part, and again, I'm looking for lehman's term, very simple whether it's the timeline impact, whether it's the capital investment, whether it's all of the above and then also the participating agencies and the process and the next steps with them. And is there some value in us holding off our approval pending those agencies buy in because we may want to either take input or adjust the scope a little bit. But again, I'm sitting over here on this side of the desk. If you could help me out a little bit, those two questions.

>> So I'll start. In regards to other agencies, the San José city council is the deciding agency for the facility. With our co-owner Santa Clara, we do make joint decisions on some issues. The t pack agencies did unanimously approve it. Sorry, there was one dissenting vote. They did approve it to move forward. In regards to the scope, a little bit more detail but the team spent a lot of time refining the scope and the result is a different scope with not as many parts and less cost.

>> Okay.

>> Okay, so I'll try to be concise because it's gone through a lot of evolution, but the grand master plan, and there was a slide that basically -- oh, sorry. I always do this. There was a slide that showed what was envisioned in the prime master plan, and the big deviation from the plan master plan is really the type so you know, we had the di-investigation that was in the plan master plan. What we were proposing is one that would operate at a higher temperature and give us the ability to get the class a solids. So basically more cost effective way of responding to the regulatory changes and market changes. So that was one big change. The other change was based on sort of a survey of the market and what we were seeing in terms of the regulatory landscape. We didn't see any imminent rivals that would require us to build an expensive terminal drying authority which even in the master authority wasn't going to dry 100% of the biosolids, only a portion of it and you would still have to do something else with the other. That's a very expensetive capital investment. So we did not see the need for the terminal drying or greenhouse drying knit in the near term. That's the other change from the plan master plan. And then the third big component was there was a large like a six-month covered storage area that was also very expensive. And again, based on sort of industry standards, we did a lot of kind of

! 79! looking into it during program validation and felt like we could do away with it with a different operational those were kind of the three changes which is why we dropped the capital cost down by over $100 million from what was in the plan master plan.

>> I have two follow-up questions. And again, you probably don't need to answer this. Somebody can do this offline. From the initial approval to now and these large significant changes, there wasn't, I don't know what changed significantly enough that got us to change significantly enough. That's the part that's missing. We can doing that not here at this late hour. And then the other was a participating agency. But I'm also thinking of one that's not a participant or at least milpitas might have the thoughts on the scope. I've read through some of the public outreach here. We are going to have some difficulties and disagreements on this but should we do more outreach on this on trying to get more buy- in than we have in the past? Not that we haven't done that.

>> I'm sorry for misunderstanding the request he.

>> The I wasn't clear.

>> Milpitas is very supportive of of this project.

>> Really.

>> Reporter: Milpitas is very supportive? I haven't heard that sentence. That's fantastic. Quote them on that.

>> They're pretty supportive. So the change in scope changed things inside the fence line so how we're going to get to the same odor result. So the impact on the community is unchanged. So that's still exactly as the master plan envisioned.

>> Even in some of those cases, milpitas still would find an issue with what we're doing and changing at a later date. I'm trying to get a sense of level of engagement with them knowing what the future might look like. Thank you very much. I'll ask for a meeting offline to get a better understanding of between then and now and what changed enough for us to shift gears.

>> I made friends with them at the meetings.

>> We can attribute this to you, as well. The legacy grows.

! 80! >> Someone had to compensate for me. Counselor.

>> Actually, that was one of my questions going from type c to type a, sorry, going from type c to the 100% mechanical drawing, I'm trying to remember all the words you guys used, the type of material that comes out of the type a, the mechanical drying stuff, is that more marketable or something? I know the landfill will be off-limits in ten years. After that, what are we going to do with itting? Are we going to be able to sell it to farmers or something or. ?

>> I'm going to start and Bruce can add if he would like. Actually, the landfill contract right now does not even require class A. It requires class B. It's just that our process produces class a because of the way we dry.

>> I understand.

>> So we did as I mentioned we did an extensive market survey and didn't see any need for class a but at some point, We believe that that will come down the road which is kind of why we're building in that flexibility. And there are a lot of different other sides where we did the survey and that other wastewater facilities take their biosolids to. So there are a lot of options right now for us to go to besides a landfill. Obviously it's the most cost effective option for us at this point. It's the closest to us so it makes sense for us to do it. But there are many other options. We have a list of all of those.

>> What I'm saying is we're not going to earn any money off of it from going to class b to class A. There's no marketable difference in it?

>> Not right now but could be in the future.

>> That was my question. The other question, I'm assuming that if we go to this 100% mechanical drying that we will get away from all the lawsuit threats and what not with milpitas? Is that -- because -- and because I've heard a lot of stuff about who is responsible for what odor. So --

>> Yes, and I think Bruce showed you a slide, what slide was that? Where we -- so you can see the dewatering facility kind of The odor profile of that, the yellow and then with odor control, you can see the tiny red dot. And so really that's kind of what happened for our odors with the dewatering facility and some odor control mitigation measure.

>> So what would be left would be whatever comes off an knew have I island then?

! 81! >> Other odor.

>> There are other odors in facility that we'll continue to work on.

>> And that's something else that I've been hearing a lot about is who is responsible for what odor. In your study, did you narrow what odor is coming from what entity in this map that you drew with all the yellow lines and the Green lines and orange lines?

>> Yes, so we -- the study just focuses on the facility itself. Just all of the odor sources from the facility. And then you have Jay's team looked at every source and sort of sampled it and modeled it. I'll let Jay add to that.

>> So it reflected the plan's contribution to the ambient odor. We looked at all the odor complaints received unofficially and noticed trends with other sources but didn't investigate those or model any of those. The air district has not issued -- the inspector has not issued from the step any odor complaints or violations. We believe the contours reflect the contribution confident ambient air from the plant as it is today.

>> So this is it -- what you modeled is just the odors from this facility and.

>> Yeah.

>> You were able to tie them directly to this where it emanated from?

>> Yeah, we just looked at the individual odor sources currently existing at the plant. We went out and measured those sowers. That's where the strongest concentration and we used air dispersion model to see how that odor concentration is did diluted as it moves off site. We focused on the wastewater treatment plant only.

>> I'm inclined to support it because I think it's probably the most stringent way if we can eliminate the odors. I'm just hoping that we can solve our odor issues in the area or our potential liabilities there.

>> This has happened at many other locations where in tacoma I did a project where the pulp and paper mills put that ammonia nasty smell out in the center of them was a wastewater treatment plant. The plant had no odor whatsoever. The wastewater treatment's plant odors shined. They had to go through an odor reduction process. By taking track of your odors and keeping them within the council's boundary, you have a strong foot to say it's not us.

! 82!

>> Okay. Thank you very much.

>> And it should be noted that we're all very interested in the sources of odor regionally. That's why we invited milpitas to join us in the study. And they declined. We'll continue to keep that invitation open. In the meantime is, we're studying our sources. David wau.

>> There's been testimony tendered to the council that Is a material misrepresentation on many levels.

>> Since I only have a minute i want to warn this kg there is not one of you or a combination of you including district 4 that has a greater knowledge than i do as I sit here before you. This is the greatest mistake the city of San José will ever make now and in the future. These people and these presentations are orchestrated for a reason. The plant master plan, first of all is materially flawed, the rest of which is just a series of appointments from the appointing authority or grotesquely incompetent, do not note what they're doing, have an unlimited consulting budget. Therefore, the engineering consulting firms it prey bon this with a vengeance. The Montgomery Watson issue should be an indicator. As the seconds tick down none of you that sit before me know as much as I do and you have been warned.

>> Yeah, I just wanted to say i support these recommendations. We had taken a look at there in the past and we definitely need to move forward on this to reduce -- I appreciate the fact we've been able to isolate this and look at this new option. We have the capital budget i guess, how are we paying for this again? Because it is higher cost. It's the highest cost, and of these options although it's going to deal with the odor more efficiently as I'm reading this.

>> We do have a plan for the funding which will be our next time and then the Cost associated with this and other ip problemments are a part of the proposed budget.

>> The changes that you made, so the old plan that you brought to us before which was higher cost I think, the changes that you had to make in the plant master plan, would they have reduced the odors any more than this solution?

>> Probably not. They also included a dewatering facility. I'm not sure about the covered storage and what that would have required. That may have actually been higher. But otherwise, yeah, it would be pretty comparable. But I would say this is the better option in terms of water related to the covered storage.

! 83! >> Great. I'm glad we found a solution and that it costs us $100 million less. That's good news. Thank you.

>> All right. There's a motion on the floor. Is that right? Okay. All in favor of that motion? Any opposed? It's unanimous. Thank very much. We're moving on to item 7.1, report on the San José santa Clara regional water facility ten-year funding strategy. Sweeney.

>> Hello. Thank you for your patience during the previous presentation which was a little long for this time of day. We'll try to keep this one brief.

>> I'd encourage that. Thank you. We are going to lose a quorum otherwise.

>> Joining me is Julia Cooper, director of finance and director of esd. As you're all well aware, we're planning for a $1.4 billion capital improvement program over the next ten years and it will be really difficult to fund this with just ratepayer increases. We've multiple times as well as to the committee and t pac about a long-term funding strategy which would use a combination of cash, short-term tools like state resolving loans and long-term revenue bonds through the clean water financing authority which is already a jpa in place set up between San José and Santa Clara for this facility. So at the March meeting, we actually presented some recommendations on the funding strategy. long-term bonds required a large level of reserves which created some concerns for the agencies and they wanted a little bit of extra time to look at some of their other options and so in response to that discussion, we're bringing forward some modified recommendations to you that will allow us a few months to kind of a few months of additional time to finalize the funding plan. And the recommendations now that we're bringing forward have been accepted by tpac. So again, we've had multiple discussions over the last year and a half with Santa Clara as well as the other tribute butry agency. It's clear the key outcome everybody was looking for was predictability and stability to the maximum extent possible with respect to the annual contributions. In order to develop a long-term funding plan, we first had to look at a funding forecast which was comprehensive and included both cip as well as o & M costs and look at how we would meet this need through a combination of different funding tools. And through our discussions we developed some guiding principles which again have received support from tpac as well as tme. The first was to look at a long-term funding strategy, predictability in terms of the cash funded capital investments and it would also allow agencies time to plan for their future revenue needs. We'd look at e & M and cip costs, look at external financing to the extent possible to mitigate impact on ratepayers and then also what was important was to minimize borrowing costs which ironically has the other policy consideration which requires larger reserves. And that presents some challenges. I'm going to hand you off to Julia to walk you through the rest of it.

! 84! >> Good evening. It's past the afternoon. So in terms of there's two kind of key financial metrics used in terms of looking at lowering borrowing costs. One is debt coverage ratio. You look at all the revenue you have available to fund your operating and debt service obligations. There's usually a multiplier factor on that. So the target for this plan will be between 1.5 and times coverage. As she mentioned this reserve and liquidity and cash on hand is important that the rating agencies look at to determine how resilient is the treatment plant with respect to meeting its operating needs and debt service needs in the event of a decline in revenue or unexpected costs. So the proposed funding plan includes about 365 days of operating expenses as the liquidity target and building up this level of reserve has caused some concern for some of the tributary agencies. So they are looking at other alternatives. In terms of the assumptions that were in the posed budget, at the March tpac meeting it, the santa Clara and other tributary agencies expressed concerns about the large level of reserves. They're all out there exploring different financing options. We've been using public resources advisory group to help us with that but can't seen to get over this issue of meeting these large operating reserves to help bring down borrowing costs. So at that time, we were assuming that all of the agencies would be participating in a financing plan with the clean water financing authority. Though at this point, it does seem to be somewhat uncertain and people were trying to finalize their capital budgets in early April. So we incorporated some assumptions about the participation in the external financing in terms of five-year contributions in the proposed budget. So there was an information moom that was released and it assumed that the reserves would be start to be contributed in fiscal year 1617 instead of earlierions which were '15-'16. So the assumptions in the propose the budget include that all agencies start contributing to a 60-day o & M reserve in 16-17. They'll contribute their proportionate share of the program through the issuance of commercial paper starting in 15-16 and address their own looking at their own individual long-term financing needs, as well. So the revised recommendation allows each agency some additional time till August look at funding forecasts And evaluate our alternatives. So this matrix here kind of outlines key differences between three major external financing options. Commercial paper, revenue bonds and state revolving fund loans. Ultimately whatever financing package comes together, it will likely be some kind of can combination of those three tools. The commercial paper we're recommending participation by all the agencies because it really does help with the timing mek hadnism and it allows the agencies to evaluate and plan for other financing options while the master plan can continue to move forward. Additionally, the master agreement calls for agencies to contribute their proportional share on a four quarter basis and that's been done kind of an equal installments but as we move forward with the large capital improvement program, they're going to need to revert to what the master agreement calls for which is basically what cash needs hatch over each quarter so that's going to create some funding challenges for them, as well. We're in the early evaluation stage of revenue bonds so the clean water financing authority. Some agencies may find it more beneficial to finance on their own top help mit game some reserves they may need to present. That will cause some timing challenges that we'll need to work through. And we'll also need to think how to use the clean water financing authority at different

! 85! agencies opt out to finance on their own. Finally state revolving fund loans are the most cost effective option and staff Is already working through an application was process for an $86 million for the dijester and thickener facilities project. So with that, I'll turn it back.

>> Thank you, Julia. These are the next steps. Basically between now and August we'll be working with each agency to help them understand the funding forecast to provide support as needed so that they can make their decisions about external financing. We've already had one follow-up meeting with each of the agencies to discuss their specific concerns and issues. In August, all agencies will need to confirm their participation in external financing and then any draft terms through the master agreement, any amendments as well as the improvement agreements that relate to financing and reserve contributions will be brought forward in December and this will allow us to move forward with commercial paper or a similar short-term financing tool. And then of course, we are actively pursuing srs loans. We have not specifically incorporated any recommendations related to the loans because it is a limited part of funding and there's no 100% certainty of getting that funding but if we do and we're hopeful we will we will continue to update the funding plan accordingly. With that, we are available for questions with our recommendations up there.

>> Thank you. Two members of the public would like to speak. Claire beakman and David wall. Why don't you proceed.

>> Once again, a stern warning is hereby issues. The tributary agencies are not pleased at all with this plan. Specifically Santa Clara and West valley just to mention a couple. Let's put things in perspective of tpac. There are only two people in the history of humankind that have greater seniority than I do attending these meetings. One is curtis Harrison from cupertino sanitary district, 52 plus years, other is Bob livengood from milpitas, 26 plus years. Outside of that, there is nobody on the planet that has nor knowledge what I'm talking about. And what I'm telling you is that your continued reliance on the an buttonments made by the appointing authority over the most valuable asset the city has is atrocious, reckless, and Just incompetent.

>> Thank you, Mr. Beakman? Ing.

>> Other about that, thank you. I just had a few questions. I'm not too familiar with this issue but with the money being appropriated towards wastewater facility, is it possible to work on the smell and the problem that's affecting the area of milpitas and district 4 of san José? I've been told there are construction problems created by the arm corps of engineers out in the area. Does this have something to do with the continuous smell? Milpitas? Has this problem been corrected? Another Dale I heard markey Matthews it council woman say, there's a very good wastewater treatment facility I think in the

! 86! pleasanton area. We should looking into that i think. I hope you can fix the smell problem soon. Let's learn to end the smell and try to end the problems there, and the smell creates kind of a health hazard that we should all be worried about and work hard to try to end. Thank you.

>> Thank you. All right. We'll entertain comments or motions at this time. Motionings from councilmember Matthews and skd from the advice mayor. Any comments or questions? All in favor?

>> Aye.

>> Any opposed? Thank you very much for the presentation. We just committed ourselves to financing about $140 million over the next ten years. With a unanimous vote. All right. Moving on to item 9.1. actions related to investment of monies from local agency investment fund. Is that Julius? No presentation. We'll entertain a motion.

>> There's a motion. Second? Any questions or comments? All right. All in favor. Aye.

>> Any opposed? That passes unanimously. 9.2 approval of the July December administrative budget. And schedule.

>> Motion to approve.

>> There's a motion and a second. No members of the public would like to speak. All in favor?

>> Acye.

>> Any opposed? That's unanimous. On top 6.1, actions related to airport airfield improvements 2015 project. Staff presentation could focus on whatever is not in the reports, that would be helpful. I think we should assume that the council's read the reports.

>> Absolutely, Mr. Mayor. Barry ingram, director of public works. Nina grayson from our office of e quality assurance, Kim Becker, director of aviation and Kim hawk, deputy director of aviation. Looking for our presentation. So let me first acknowledge than on behalf of the team that you've received some information from the minority business consortium recently that raised some concerns. So on behalf of the team I just want to say we're committed to working with the FAA to resolve any discrepancies raised by that information. And in addition, with the recent memo from councilmembers it Carla Jones and Matthews, the team is committed to working on a city-wide dbe policy and it's in our work plan upcoming and it will be prioritized at the upcoming June 23rd policy setting session. Priority setting session. So

! 87! with respect to our slides being succinct, let's just talk about the project for a moment. There is some urgency to award the project today. This project is designed to do basically three things. There is some pavement settling at the intersection of runway 30 right and taxi way Julia that settled about 2 inches producing a noticeable bump for planes taking off and landing. We need to rectify that quickly. We need to meet new FAA airport design standards and airfield directional assigned standards. For these three reasons, it's imperative we get working on this project quickly. It's a $3.26 million project. Construction needs to be completed by mid October although the slide says September mid October so we don't push it out to the next year. Grant funds are also involved and need to be committed by September 30th or those may be lost. So the bids were opened on April 30th, we had two bids for their project. The low bidder $2.7 million and granite construction significantly higher. The project involves three basic teeps of -- types of work. Nina is going to allude to how these have caused some issues with dbe opportunities and dbe participation. Paving is about 50% of the work. Electrical 34% of the work and striping about 5, but those three taken together is the major components of the project and there aren't a lot of dbe contractors and nina will explain that for those these components. Reminding you there is some urgency to get this done all summer. I'll turn it over to nina who will quickly go through a couple of slides.

>> Thank you, Barry. In terms of speeding this up here, I will not address the race issue, the race conscious race neutral issue since Rick's memo addresses that. So I'll just skip to our outreach everts. And results for this project. As Barry mentioned, our outreach everts included identifying potential and possible subcontracting disciplinaries to be prognosised on the project and this 15 such subcontracting disciplines were identified. Based on this information, staff then searched unified certified programs dbe be directory for certified dbes in each of these 15 categories and that search identified a total of 81 firms. Each of these 81 firms were mailed letters on April the 8th, the letters included information about the project, the subcontracting disciplines, the bid date and time and a list of the potential time contractors who had viewed the plans and specifications. Letters were also mailed to potential prime contractors. Those letters included similar information that the dbes received but the letters stressed the city's commitment to attracting and enhancing diverse business participation and that the city encourages And expects contractors to do the same. Additionally, the contractors were provided with the names and the mailing dress addresses of the 81 dbe certified subcontractors. We also mailed letters to the local ethnic chambers of commerce, excuse me, the silicon valley chamber and other interested organizations. Airport staff held a prebid meeting on April 8th. Three prime contractors attended the nonmandatory meeting. Project details were discussed including prevailing wage requirements and the airport's dbe program and contractors were strongly encouraged to include dbe participation in their bid. And lastly, airport staff posted the bid opportunity on the airport's Website. So what did our outreach everts yield.

! 88! >> Both of the two bidders included dbe subcontractors. Granite rock who is the low bidder committed to 1.5%, $41,000. With two dbe certified subcontractors to perform erosion control and concrete grooving. We were pleased with the current commitments since granite rock in previous years they had been awarded the taxiway w extension and reconstruction projects and they had no dbe participation. And granite construction committed to $1.8 million. While this dbe participation is less than what we desired, it's not unexpected due to the type and nature of the project. As Barry mentioned earlier, this project is essentially a paving contract where the prime contractor will self-perform the paving elements which are also the highest dollar values. Paving contractors are typically well established companies due to the nature of the business requiring large capital investment and an outlay for equipment. There are a small number of dbe certified paving contractors. The dbe directory includes 50 certified dbes paving and Earth work contractors and less than five are located in Northern California. Ffo and bta have had similar dbe participation rates on paving contracts. So the other two large dollar subcontracting disciplines on this project are striping And electrical. Unfortunately, there are few dbe certified stripers And electrical subcontractors in the airport's market area. As a result, what remained are the small dollar value subcontracting opportunities For dbe certified contractors. And that's how we attained the -- how we got to the 1.5%. I'm hopeful that the remaining construction contracts that the airport is planning to advertise and bid which coming up is a perimeter fencing and then next year will be an airport perimeter technology project. And two consulting contracts provide for more opportunities for increased dbe participation and getting to our goal of 14.5% dbe participation. So as we -- as we approach the third and final year of this dbe plan, we will continue to develop individual lists for each of project based on the subcontracting areas. We will communicate directly with dbes, prime contractors, are, the chambers and interested organizations regarding airport contracting opportunities. We'll follow up with interested parties providing any as needed assistance and we will ensure bid notices are available to dbes in a timely manner and all airport contracting opportunities will be posted on the airport's Website. And this concludes the presentation and we're here to answer questions. Thank you.

>> Thank you. Councilmember Jones.

>> Thank you. First of all, is there a representative from granite rock here tonight? From the company?

>> No, I don't believe so, councilmember Jones.

>> Okay. First of all, I want to of address the minority business consortium letter with the particularly the were you contacted by Patricia Wright from the FAA about the dpe goal.

>> Yes, Patricia Wright contacted me yesterday.

! 89! >> And what did she inform you in that when you talked to her?

>> I had a couple of conversations with her. I provided her with information she had requested some information about the bidding. And I he forwarded her the link to the bids, to the city's bid sync that shows that I also explained to her the participation that we received on the contract. And the elements just as i explained earlier here, the elements, the subcontracting elements. Later in the day, she called me back and which was about 4:30 yesterday. And mentioned that even though we had -- she had givenf aa verbal approval to us of our program, she was changing that and saying that it needed to be a race conscious program.

>> Effective June 1st or --

>> I don't know. She didn't say. I mean we had a brief conversation, and you know, i don't have anything in writing. It was a verbal conversation.

>> Okay. As far as the timeline on this project, I know you said that we need to have it completed right away. Are there any safety after he issues that are -- impacting the two-inch I guess bump or --

>> The -- I'm not going to classify it as a safety issue on the bump or dip. We call it a bump dip. It right now, we sense that it's settled as much as it we think it will settle. Certainly whether over another winter season if we have rain, could it settle more, that's a possibility. It is part of our 139 certification inspection. So it was noted as a requirement tore fix the signage, the taxiway, no taxi area and the bump dip. As part of our certification program, and that's why the FAA funded it because it did appear on the 139 certification inspection.

>> Barry, I guess this probably is a question directed to you. So if we sent this out for a rebid with trying to achieve that 14.5% goal, what would Be the timeline on that?

>> I'm going to say that typically our bid taking something through a bidding process can last as little as ten days because that's what's required by the muni code. However, this is grant funded. So there's a grant funding advertisement period and it goes longer. So if I had to try to answer your question rebidding this project to trial to increase dbe participation would be probably a six-week total process.

>> Okay. So that would still put us well within the window to do this project? Well, no. I should tell you that the -- there are leads times after you award a contract so the contract needs to be executed. If you were to award today, the contract, the contractor could start working and we have it planned out to start working mid-July so that they can finish in 66 days by mid-October. But we are on a very tight window.

! 90! I keep telling that to you on different projects. We get ourselves into these situations sometimes and that is what we're faced with. We have a 66-working day that we've given the contractor to perform and we're right up against that by working today.

>> So if we moved it out six weeks, that would put us in mid-September?

>> In theory, we would not want this contract to the proceed because there's only so much you can do in 66 working days. We would push to next calendar year and be in that grant situation where the grant funding would be lost for this calendar year or this Federal Fiscal year.

>> I have to be honest with you, and Barry, I know it's like groundhog day in terms of having the conversation about we have to make the decision now because you know, we hit the wall. But I would have -- I'm having a very difficult time supporting there because I know based on my experience and looking at other airports and other programs dbe programs, that even with the large contracts, that they're able to figure out ways to hit their goals and exceed their goals. And so I would be very resistant to support this. I'd like to actually have it go out to either a rebid or go back to the contractors and have them modify their proposals. To reach that goal. I don't know what that looks like look process wise. But as it stands now, I would -- my preference would be to be have it go out for rebid.

>> So let me emphasize --

>> I wanted to jump in at this point.

>> Staff, one part of the construction piece and the delay, can you please be very specific on the funding regarding this project and whether we lose it, do we have a possibility to ask for an extension? Could you just elaborate on that, please?

>> Yeah. We would lose it for this Federal Fiscal year but it could roll over until next Federal Fiscal year and be available for next year to the airport. They're considered entitlement funds. They can roll over. Discretionary funds are lost.

>> Could you describe what could means? Can you rely on the money being there or not? That's really what I think we all want to know.

>> I think we can rely on the money being there next year.

>> Okay, that's the important thing.

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>> I actually have and sill Larry question, too. The difference in the bids, the two bids that came in was about a million dollars. Was there, a misunderstanding or were they looking at different scopes or work or did you get a clarification of why there there was such a discrepancy in the bids.

>> Well, the actual apparent low bidder granite rock, has done a lot of work at the airport. They're out there. They were out there recently completing the taxiway wa series of projects that wrapped up last year. And so they are considered to be very competitive at the airport so that other major paving contractors kind of will just throw a wild number out there to see if granite rock didn't indeed get the job and didn't bid carefully enough. You're seeing exactly that. You're seeing $277 million for granite rock and 3.9 million for granite.

>> Yeah, a substantially higher bid just to see if they get lucky and get the job and get a lot of money out this. It's a competitive market between the top two of paving companies. That's what I wanted to emphasize to you when you consider a rebid, the outcome may very likely be the same in terms of dbe participation because what we were trying 0 to explain is for the character of the work that you're seeing, paving, electrical and striping as nina was trying to portray, the field of dbe certified dbe contractors that would participate in this bidding process is very slim and limited in those categories. In other contracts for our airport or for other airports regionally, the mix of the work is different. And it really are depends on the mix and the character of the work where you get those increased dbe opportunities and therefore, the participation with our outreach would likely go up.

>> If I can add to that, in the past, where the airport in the i guess late '90s early towels, had a number of Federally Funded projects that were specifically what are termed the act projects, acoustical treatment projects that were mainly -- they were all residential installation. New windows, insulation to buffer noise from the takeoff.

>> I remember.

>> And we had under that program and under that dbe program that we did have a race conscious program. And we achieved 5% over a number of years over that. And we had in the act programs in those act projects we did have higher participation because of the types of you had windows, you had insulation that were residential type contractors where there are more dbe certified. But when you get into and it really does depend on the project and what types of elements are in that project whether or not you have ability for high dbe participation. And I think I've said this before. Is that one of the impediments to higher dbe participation is the actual dbe certification process. Which is strenuous, rigorous and a real pain. And you know, it takes, it's very difficult. And the FAA only counts dbe

! 92! participation of those that are actually certified dbe contractors. And there are very some of them in certain fields are very, very limited.

>> I totally hear what you're saying. But then I go to sfo's Website and look at their numbers and i know that we hate to compare ourselves to our, you know, neighbor to the North. But when you look at their numbers, it's pretty significant. And so then you have to ask your question, ask the question, why are we having challenges in terms of identifying dbes, getting them certified and bringing them in on these contracts when other airports are not.

>> And to answer that question, San Francisco has a local business enterprise program as well as a small business enterprise program. And when you look at their numbers it, their participation in those lbes and spes are high. And their dbe participation is not that high. Especially they did last year, they did a -- it was a runway, a safety improvement, it was a huge contract. $87 million. They had one dbe certified contractor on that project. But they had -- but they had sbes and lbes. And we don't have any of those -- we don't have that type of a program. However, with that direction, we're going to be looking at doing something like that.

>> Jump in at this time. We're going to be losing a quorum soon. We have some options here. It seems to me there's information we may need to get that we could get in a week presumably. Both in terms of making sure we've got money from FAA and understanding exactly what was conveyed verbally by phone. And confirming that in writing. I think that's probably an important thing for us to do. We could take a continuance on this item, come back in a week with better information or if you believe we're close To making a decision, we can certainly do that, but I sense that there's a considerable amount of concern. Yes. Okay. We do have two members of the public who have been patiently waiting. I'm going to ask them if they'd like to speak at this time and we'll consider a motion to defer. Walter Wilson is here. Mr. Wilson?

>> Mayor, council members, staff, thank you for hearing me today and thanks for receiving my letter. This is very concerning to me. I was going to read our letter but you already saw it. The thing is when we voted you voted for 14.5% floor and in three weeks, nina grayson's leather came out. There are no goals. She didn't say that in this whole conversation. She said there are no goals. I called her and asked her what that meant "she said it means these contractors do not have to the hire a single woman or minority or dbe business for this contract. That was problematic. Because we were excited about working with you, but then we hear this. I was like you know, it sounded like somebody was playing games with us, quite frankly. I don't know if you were part of it. Apparently you're not because the people who I talked to here about it figured this is mot not what we understood we voted on. And you know, I was sort of disillusioned this process. When I had a conversation with the city manager and his

! 93! staff, they encouraged us to keep moving forward because we're about to wash our hands and say we're not going to play this political game. I'm glad we did move forward. Let me say this to you.

>> Thank you, Mr. Wilsome.

>> Patricia Wright did write a letter.

>> Mr. Wilson.

>> She said she sent her an e-mail. I'll share that with you.

>> We're out of time.

>> Reverend?

>> Well, I have some notes but the conversation that we had, listen, we will never end up being any better than this unless we do something different. There is dbes and small businesses that would love to be in this pool. If we continue to do this, there will never be any available. We know San Francisco and Oakland is doing better and san José could do better. If you guys decide to pull this back for a moment and do the right thing and let's get started on a good foot because if you want to have a an invigorated workforce here that can work on these projects, that income contribute to this community, it's going to take you guys of being brave enough to say let's do the best job we can because if we do this, this 14% will never be reached. And zero is hard to beat. That you almost have to be deliberate to get to zero. So I think we can do the right thing and it will be better for all of us. Thank you.

>> Thank you. Mr. Wall?

>> Comments are directed to -- as a good civil engineer, my concerns are with the surface areas beneath the runways. Groundwater has been an issue ever since the airport was the around. I mean the groundwater's been there for years or decades. Who knows, eones. Is that an issue? Are we seeing subsidence out there.

>> Has there been any consulting geological surveys been done on the runway areas with reference to the effects of groundwater and subsidence issues? Thank you.

>> Okay. If there are any -- if there Is a desire to defer this matter, we can consider that motion at this time. We can also --

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>> I'd like to make that motion. I'd like to make it the motion to defer this item for a week to get our answers, questions answered.

>> Okay. With that motion in play, so there are additional questions, anyone wants to pose for folks to come back in a week, I'm sorry, Ken, did you need to say something? Okay. Any other additional questions that need to be posed that they should be coming back with? Councilman.

>> Well, I just wanted to ask our speakers who came from the public that you know, our airport staff says that there's no dbes capable of or worth companies or certified dbes that are capable of doing the pavement work on the runway. If we're coming back in another week, I'd like to have an example of one that or at least a couple examples of one that fit the description in a week. In a week I'd like to get the examples.

>> Gentlemen, I'm sorry. You can't be heard unless you're in front of the mic. I'm taking from your response that you will have additional information for us. Is that fair to say? Okay. Unless you'd like to come down. I think we get the point that there are other companies out there.

>> Again, I just want to be -- i want to make sure that there are opportunities that -- I just want to make sure that we are -- if we end up making our staff do the work again, that there are reasons for it. And so that they're not coming back to do the work over again. And I am concerned about this going over to next year because you know, we are trying to make our airport look and feel like a better airport than san Francisco and having a runway that's smooth is really important attracting new airlines. I personal liam, I think I felt a couple of those bumps since I've taken off. So I understand the necessity of it, but I'm willing to support the motion to come back and get those questions answered. I just want to make sure that there are -- that the words that they used and I'm sure I'm screwing it up somehow, the certified dbes that can do the jobs that potentially didn't bid on the process, to be contacted.

>> Councilmember?

>> Thank you. Thank you for asking about additional questions. Can you clarify the ones that we're actually asking for.

>> I think we can't want a clarification about the conversation nina grayson had with regard to whether or not we are able to use use race conscious basis for --

! 95! >> We need to get the clarification from the FAA because the information we've been receiving up until nina's call yesterday from the FAA was they approved our program and our reading of the law is different. So we need to just have that conversation and get back to you with the answer.

>> So that's your number one. Issue number two is a lockdown that we can count on this grant known going over.

>> Right.

>> And I would also request and I know you spoke a lot of this verbally but if it's possible as the city manager, can we get a supplemental staff report that talks about what a rebid would look like and the timing Annan certainty around all these issues? Forgive me saying this bluntly, but not just all the obstacles and what all the harm would be but just a standard practice of what the timing would be and whether it's possible, truly possible or not and what would mean to the city of San José and the airport.

>> I want to thank my colleagues for doing this work and their leadership on this issue, especially councilmember Jones. Thank you very much.

>> Okay.

>> And I want clarification to on the urgency of this project and relative to safety, et cetera. Can we will postpone it or is there a significant need to get this thing done in the next 66 or whatever days that you were talking about. Also, in terms of the -- of the program and the FAA's administration of it, it sounds like we don't -- we need toef have, there needs to be a better process in terms of encouraging folks to sign up for it. Sounds like we, that's part of it. Maybe is there you know, is there a need beyond that to that goes outside the airport that just encourages women and minorities to get involved in these type of businesses. So I think there's things the airport can do and I this i there's bigger issues that go i don't want the airport. And so I'll look forward to hearing all this next week. Thank you.

>> Okay. There's a motion to defer from councilmember Jones. Is that right? All right. All in favor. Any opposed? That's unanimous. Thank you for staying on councilmember Rocha. We have one item left because 6.2 has been deferred. That's item 6.3 management operating plan for transportation network company. Okay. We have one, two, three, four, five, six. Weigh barely have a quorum. Okay, thank you. It's like an agatha Christie novel. Six of us left now. That's right. Nobody can go to the bathroom. That will keep all comments very short. Part of the strategy. All right. So this this is item 6.3. I'd ask my counsel colleagues to note there is a memorandum from myself suggesting a deferral asking specific questions that might be asked when we come back at that time, there are many

! 96! members of the public who would like to speak, perhaps we'll take public comment first. Would that be appropriate? All right. I have Michele guto. Come on down when I call your name, come on down to the base of the stairs. Michele orzaga, Angela Mooring or angie Mooring and Mike musselman. Good evening.

>> Good evening, this is nerve-racking. There's the timer. So I may -- I'm 45 years here in California in San José with all the great schools here, Mr. Glen high with councilmember Olivaro, my family members all are betterman alumni like the mayor. Throw that in. But I'm a single parent. And there's no way that I could afford rent here in the silicon valley without doing a second job. My primary job is in hi-tech. I work at cisco. Still don't make enough to cover my rent and lift has helped me out in that way. So times are changing here in Silicon Valley. And we know that our customers want options. And I've had many of my passengers say to me they wished that lift was at the airport. That they want us to there. And they love lift. And they love the service we provide. And they would like to see us out there. So thank you very much for your time.

>> Thank you.

>> Michele?

>> Welcome.

>> Hi.

>> Thank you for your patience.

>> Hi. I'm Michele. I'm born and raised here in California. So we all know the cost of living has gone up. I work for a non-profit. And then I also work for lift and honestly, it's been great. It's been wonderful. It's enabled me to pay a lot of my bills and live comfortably in Silicon Valley and there are times where I have traveled and I would rather take a ride with a lift. It's because I feel that I make it the other rides important to other people. It's like if you're coming in from out of town because we are an international airport, And you come in, you want to get the home scope of like what's to visit, what's to do, where To go. And that's how we give the feel of I'm your friend with a car. And being able to go over there, it's like any type of competition. Everybody has an option. If they have a choice to choose lift, it would be wonderful and be a benefit for everything because the more money staying within Silicon Valley, as well. I just think you guys should go out there and take a lift. If you haven't done so already, you need to go out there.

! 97! >> Thank you, miss orzaga.

>> Thank you.

>> Angie Mooring. Effective marketing. Angie, going to be followed by Mike and Rick porter. Nathan yap, and yes.

>> Hello, my name is angie. I'm with dog pound lift. Dog pound lift is my own creation and when people come and take a ride with me, I have my car decorated with dogs and I talk to people about the importance of animal rescue, rescuing dogs and cats from the shelter or animal rescue organizations. People love to ride in themed lifts. And this is something that some of us drivers like to do. Another thing that I I do is it called lift angel. Have I organized events where different people from different parts of the nation go to bars wearing the moustache on their back like angel wings and we talk about the importance of knowing what their options are when they're drinking. Because many of us have known people who have died because of drunk driving or have you know possibly killed other people. Solicit is important. We should be in the airports. People love us. They love lift. We are a friend with a car. Thank you.

>> Thank you. Plaintiff.

>> I'm a director of government relations at lift. Appreciate you all staying late and appreciate you, mayor, the council members for the willingness to meet with us tols learn about lift and think critically about ride sharing at the airport. Appreciate the collaboration with the airport administration and their staff answering tough questions around curbside congestion, consumer safety, and cost recovery questions that have come up in airports across the country and we agree that while this -- is it perfect? It addresses these concerns that folks have. But the good news is we're not starting from scratch. We have permits at John Wayne, places like Denver and in Tennessee where we have permits that we can learn from those. Safety is our absolute top priority. It's the foundation which the industry is built. We have rigorous background checks, driving records checks, criminal checks, inperson screenings, vehicle inspections. That's why we have insurance that exceeds or meets requirements for the state. Two last things snoopgs I'm sorry. I appreciate it, but I'm sorry.

>> We appreciate your collaboration on this and look forward to working with you on it.

>> Rick porter.

! 98! >> Good evening, everyone. My name is Rick porter. I'm a driver with lift. I've been driving with lift since day one here in the South bay. October 2013. I use it as a primary source of income to take care of my four wonderful children, my wife. As I build my business to launch a retail shop here in the South bay focusing on a reptile hobby, lift from day one did wonderful job picking up people at the airport. At first we were allowed to go in there sort of. But our customers got the feeling that it was a great option. And now that it wasn't available suddenly, they're asking us when are you going to be back? When can I get a ride? We can drop off but we will to tell them I'm sorry I can't pick you up. That's something they want to be able to do. I really encourage you to vote yes, get this ordinance under wraps and let us allow our customers to get the choices that they need for their safe fun, friendly and affordable rides to and from the airport. Thank you.

>> Thank you.

>> Nathan?

>> Mr. Mayor, councilmembers, my name is Nathan yap. Thank you for your time. I've been a lift driver for just as long as Rick since 2013, and I have five kids myself. This is my main way to support my family and it's been an awesome blessing for us. With five kids, it's hard to work just a regular job. So it's been awesome. Been great to be part of it. And I feel that not only the citizens of San José, silicon valley as well as visitors should have the option when they come into San José at the airport to have a safe alternative that's going to be affordable. I think you guys should move forward with this.

>> Thank you, sir.

>> All right. Thank you to all the members of the public who have been so very, very patient in waiting through perhaps suffering through this meeting. I just wanted to say there was a memorandum I submitted after conversations with my colleagues really I point out quite simply I'm quite inclined to support moving forward but there has been a lot of concern whether or not there is an even playing field. We love the pink mustaches but questions about whether or not the regulations and fees are really fairly borne by all is an important question I think for all of us. There were some questions that are simply not fully answered in those reports. So I wanted to ask if you might be willing to make that motion and if there might it be other questions, as well. Certainly we can air them at this time. Advice mayor?

>> I'd like to make a motion To move the mayor's memo forward. That would ask for defer the and answering several questions that he has thoughtfully posed on the subject if I can get a second. And I also just wanted to say i appreciate folks hanging around and sharing the input from lift and I appreciate

! 99! that lift did respect the fact that we told you not to service the airport during this time and you did do that. You didn't pick up there. So we appreciate that. And look forward to discussion.

>> Agreed. Any other comments or questions for staff? Before this comes back, this would be for June 23rd I believe. Okay. The motion is to defer. All in favor. Any opposed? All right. We have two members of the public who would like to speak. Mr. Beakman and Mr. Wall. . Beak man, why don't you come on down.

>> Mr. City manager, this deals with the issue AT&T e yesterday with the environmental services with reference to the audit of the sushside recycling program. It's obvious from the auditor's report that e subpoena tp ran this program into the ditch. The principles that were there represented about $400,000 plus in salaries and benefits. It's my contention Sir That they're not being held Ed accountable. In addition, how can you explain to this council that they are awarded a $200,000 consulting contract to better curbside recycling when that is their job to do in the first place. In my opinion, the entire command staff at esd should be removed and that whole department should be reorganized dispatch. I am not satisfied whatsoever with t & E's little smirking of the issue, the advice mayor's noncompliance with baying attention to what's going on and this needs to change.

>> Mr. Beakman?

>> Thank you. I hope you're working on the two items I have asked about since the beginning of may. The first is asking the police to speak a different language when talking about the surveillance drone in public. I'm beginning to see since early may there are several ways of variations on how to do this. More ways than I like to be fair to you or to the Democratic process. On the second item, hopefully, we are out of the fog of war and the money and pressure from big Super Bowl corporations when this drone program was first introduced in 2012. Hopefully here in 2015, with a clear knowledge and understanding of ourselves and a clear vision of our community's future, I think it is time to show the proper adult responsibility for this drone project. Thank you.

>> Thank you. This meeting is adjourned.

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