City Council - Regular Meeting

We are live.

Good evening, ladies and gentlemen. It's my pleasure to welcome you tonight. Good evening, ladies and gentlemen. Welcome tonight to the council meeting, June 23rd, 2026. Am I here or am I back there?

Mayor, we are testing.

Just give us one second. Is anyone in the room is on Zoom? Testing. Testing. I think we are good now.

Roll call.

Council member Catanzio? Vice Mayor Jorgens.

Present.

Council Member Greendell.

Here.

Mayor Hannon.

Here. Councillor Little is on vacation and will not be attending tonight's meeting. Let's please stand for the Pledge of Allegiance. flag of the United States of America, and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. It's always so great in our community when we can introduce new employees. And there's no greater responsibility, as you've heard me say in the past, than we government to provide a community that is safe for all of our residents and for our residents to feel safe in our community. And the way we do that is we hire outstanding people to become police officers in our community. So the first person I'd like to introduce is Miranda Heckman. Ms. Heckman, would you come forward, please? Miranda Heckman was hired as a police officer with the New York Police Department on April 29, 2026, following her graduation from the Alameda County Sheriff's Office Regional Training Academy. Officer Heckman began her career with New York Police Department on July 6, 2023, as a part-time vehicle abatement officer. Her dedication to the community quickly earned her a Blue Award for Outstanding Community Service. In February 2024, she transitioned into a department's full-time vehicle abatement officer position. Before pursuing a career in law enforcement, Officer Heckman attended the University of Texas at Austin and North Carolina State University, where she competed as a Division I swimmer. She also represented Team USA in international competition, participating in swimming World Cup events and competing in the 2016 and 2021 U.S. Olympic team trials. She is currently completing her bachelor's degree in interpersonal communications. Officer Heckman is proud to be following her father's footsteps by serving as a police officer, continuing a family tradition of public service and dedication to the community. Her father serves currently in the city of Newark as well. A Livermore native, Officer Heckman continues to reside there with her girlfriend, Brooklyn, and their two dogs. In her free time, she enjoys visiting national parks, hiking, drawing, and refurbishing thrifted furniture. I just want to say off the record, I had the opportunity to meet Officer Heckman when she was a part-time vehicle abatement officer, and I clearly saw in her a real capacity to want to serve the community of Newark. She went out of her way to make sure that issues that were brought to her attention as a vehicle abandonment officer were addressed in a timely manner. I have nothing but high regard for the Heckman family, and I have high hopes for Miranda Heckman as she begins her career as a Newark police officer. Let's welcome her. Congratulations. Let me also welcome police officer Maria Gonzalez-Alvarez. And of course, she's here with her proud husband and her proud son. How old is your son? Three. Three years old. And his name is? Andre. Andre. I asked Andre, are you proud of your mom becoming a police officer? He said yes, almost immediately. Now, when he gets to be about 12 or 13, that perspective may change a little bit. Maria Gonzalez Alvarez was hired as a police officer with the New York Police Department on April 29th, 2026, following her graduation from the Alameda County Sheriff's Office Regional Training Academy. Officer Gonzalez Alvarez grew up in Rio de Janeiro, Brazil. Boy, that's a conversation. Team's doing well.

Team's doing well.

I'm a Newcastle fan, by the way. And one of my Newcastle players is a star player for Brazil. So I root for them. After graduating from high school, she earned a Bachelor of Law degree and later completed an undergraduate specialization in tax law and taxation. Prior to moving to the United States, Officer Gonzalez-Alvarez worked in the legal field in Brazil for approximately eight years. During that time, she spent two years as a trainee with the Public Defender's Office, worked directly under a public defender. after becoming a licensed attorney. See, we don't just hire folks just off the street. We hire folks that are Olympic swimmers at some point. We hire folks that are attorneys that then realize there's really a more noble way of making a living. Isn't that true, Mr. City Manager? After becoming a licensed attorney and member of the Brazilian Bar Association, she practiced law for six years, civil law. After relocating to the United States in 2018, Officer Gonzalez-Alvarez worked as a professional dog groomer and successfully operated her own grooming business. While pursuing a career in law enforcement, she became a United States citizen. Congratulations. Officer Gonzalez-Alvarez is trilingual and speaks Portuguese, English, and Spanish, allowing her to connect with and serve a diverse community. And that's going to come in very helpful here in our community. In her free time, Officer Gonzalez-Alvarez enjoys CrossFit, traveling, and other outdoor activities. She especially values spending time with her husband and her son. Her favorite hobby is cooking for family and friends, and she enjoys bringing people together through food and shared experiences. Officer Gonzalez-Alvarez, welcome to the City of Newark. City Manager, these new officers that come on board, they know that the Mayor drives a white Tesla. Ladies and gentlemen, I'm pleased to introduce Ms. Liz Ames, who will give a presentation regarding BART. Liz represents District C6, rather, which includes the City of Newark. Ms. Ames, welcome.

Thank you, Mayor and Council Members. Liz Ames, I'd like to start with Bradley Dunn. He's our manager of Community rela- no.

Local government.

Local government and community relations. I always say public affairs. I always get this wrong. But go ahead, Bradley. We're going to split this up 50-50.

So thank you so-

Thank you Mayor and members of the City Council. My name is Bradley Dunn and we're here to talk to you about a defining year for BART and we think the whole Bay Area. But we're going to start by talking about what we're doing to bring a new BART, a safer and cleaner BART. Our fare gates have been installed in all 50 stations across the Bay Area. And they've been an absolute game changer for us. They've reduced fare evasion, helping to deter unwanted behavior. We've seen hours spent on maintenance within the paid area plummet. And early indications show revenue growing by about $10 million a year annually through fare evasion reduction. We've also paired that infrastructure investment with a focus on police presence with our police officers and our crisis intervention specialists. Together, these have led to an overall crime rate decline of 41% in 2025. That boosted visibility and the new gates are changing the station environment. You can feel the difference when you're on our trains or in our stations. We're also focusing on something that our riders have told us is very important to them, cleanliness. We have doubled the rate of deep cleaning. We're running our all-new Fleet of the Future trains. And we're really proud that our customers have given us the highest customer satisfaction ratings in decades. We also are making changes to our station environment to make it more friendly to our riders. We have a tap and ride system that was brought online last December, which is great. You can use a contactless bank card like a debit card or a credit card to pay your fare. You don't have to buy a clipper card. It's great for occasional riders or family or friends that are coming from the airport. you just tap that credit card and go. We've installed LED lights, which are not only great for the environment, but light up our stations and increase the sense of safety and security and deter unwanted behavior, making our stations much more welcoming. We're also working very hard to replace our oldest and most used escalators throughout the system because we know that it's a lot more pleasant when you don't have to climb up stairs to access BART. We're also really embracing our role in the community and our connection to the community. So we have been doing arts and culture activations and events. We just had our BART prom a couple of weeks ago, which we called Under the Sea Line. It was an 80s-themed prom that brought 1,200 people to the Rockridge Station. And it was a great family event. We've got our anime festival coming up. this fall at Warm Springs Station, along with a bunch of other amazing events like our Sweater Fest, our Maker's Markets, our Trick or Treat Trains, all to really help, you know, kind of galvanize that community support for BART and really bring, you know, have people say, I'm going to bring a friend to this kind of event, see that BART is a really EASY AND ACCESSIBLE WAY TO GET AROUND THE BAY AREA AND DECIDE, HEY, MAYBE I'LL TAKE THAT TO WORK OR MAYBE I'LL TAKE THAT TO A NIGHT OUT AT A LOCAL RESTAURANT. WE ARE ALSO EMBRACING FORWARD THINKING FAIR PRODUCTS THAT HELP THE CORNUCOPIA OF OUR COMMUNITY ACCESS BART. SO WE HAVE OUR CLIPPER START WHICH IS OUR NEW LOW INCOME DISCOUNT PROGRAM WHICH PROVIDES 50% DISCOUNT FOR FOLKS THAT MAKE UP TO 200% OF THE FEDERAL POVERTY LIMIT. And we also have plans like Bay Pass, which is a universal Bay Area transit pass that your employer can purchase for all of its employees, kind of like a gym membership or another kind of employee benefit that allows you to access all 27 Bay Area transit systems and has been one of the fastest growing categories of our ridership. WE'RE ALSO WORKING WITH OTHER OPERATORS TO MAKE OUR SERVICE MUCH EASIER TO USE, WHETHER THAT'S, YOU KNOW, WORKING WITH MTC ON OUR NEW WAYFINDING WORK OR WHAT WE'VE HIGHLIGHTED UP IN THE SLIDE DECK, WHICH IS OUR ALL ABOARD BIG SINK, WHICH IS keeping all of the Bay Area transit agencies moving together. So, previously, we would change our schedule. AC Transit would change their schedule. It wouldn't happen at the same time. So, a lot of those connections would break, leaving people, you know, transferring from a bus and then missing a train. And so, we've worked together so that they're all changing at the same time, eliminating some of those friction points that really cause people to have a tough time taking transit. So, we think altogether these improvements are really making the rider experience much, much better than it was even a couple of years ago. And we're really proud that our riders seem to think so as well with those decades high rider satisfaction numbers. WE'RE ALSO WORKING TO MAINTAIN OUR COSTS IN THIS PROCESS. SO PRIOR TO THE PANDEMIC, BART RAN ON OUR RIDERS FAIRS AND IT REALLY FUNDED OUR SYSTEM. 71% OF OUR PRE-COVID COSTS WERE PAID FOR WITH RIDERS FAIRS WHICH WAS SEEN AS THE HEIGHT OF FISCAL RESPONSIBILITY. WE DIDN'T RELY VERY MUCH ON LOCAL TAXES OR STATE HELP. So, today, when we, as the Bay Area, trail most major cities in return to office rates and remote work has really changed how the Bay Area lives, works, travels, our total ridership is down a lot. But... The number of human beings that we're serving is about the same based on the number of unique clipper cards that tap into our system every month. Those riders are just taking about 1.2 less trips per week. And so when we relied on those fare revenues to fund our system, that made us really uniquely vulnerable to this pandemic. So our operating budget is about $1.2 billion, and we have about a $370 million structural deficit, which tracks very closely to that fair revenue being down $300 to $400 million. There's a lot of different approaches that we need to take, and we're taking an all-of-the-above kind of approach to this solution, whether that's ridership increases, fair revenue growth, cost controls. But really, at the end of the day, You know, those things are not enough on their own and we need, you know, more revenue in order to keep the system running the way it is now. When people say you've got a really large deficit, often they ask, well, are you running efficiently? Can you tighten your belt? And so as we're running our service and we seek new funding, we are really focusing on those cost controls. But the reality is that BART has one of the lowest costs per passenger mile of any pure transit agency. That's the cost to move one person one mile. And it's a really good metric that compares similar systems across different areas. So as you see in the chart, BART, it costs $1.12 to move one person one mile. The systems that are most similar to us in that chart, MARTA, And Atlanta is $1.18. And WMATA, the system that was built immediately after us that most of or is most similar to BART in terms of the engineering, that cost $2.52 to move one person one mile in Washington, D.C. So the reality is our operating costs are not only growing below inflation, it's also growing at the slowest rate of our peer agencies in this high inflation environment. All heavy rail has high fixed costs, which means that only about 40% of BART's costs change depending on our service level. Turning on the system for heavy rail is just very expensive. So really, there isn't a way to cut operating expenses without disproportionate service reductions. And we know that if there are really significant service reductions, that also puts our revenue at risk, that thing that we depend on for most of our funding. As people say, this system is no longer easy, convenient, safe, and reliable. So we really have to avoid those kinds of situations, which is why there's no real service-only way of closing our financial deficit. So I'm going to turn it over to Director Ames to talk about accountability and our current financial situation.

Thank you, Bradley. Yeah, so we've done a lot of great work so far, but there's more to be done. You know, our customer satisfaction rating was, I think in 2018, it was like 56%, and now it's over 90%. But with that, we have this accountability task because, you know, we have to reduce our expenses significantly. We do have a fiscal deficit. So we do have an Office of Inspector General, as you know. Well, you may not know, but we have an Inspector General that looks at our operations, our performance. They can do investigations. They can do performance evaluations. So in that way, we can try to trigger efficiency measures could be put in place, or we can also address waste, fraud, and abuse. that's through investigations. Also through SB 63, we were trying to show like what have we done from 2019 to 2025. So what we did is we did about $500 million in savings, we did a retirement program, We tried to reduce our FTEs, our full-time equivalent, our full-time employees. But then we slowly, gradually added more employees because we're ramping up service. Now every 20 minutes, you see a train. You see more people out there in the stations. The police officers are out there. So I think people feel a lot safer taking BART now, and it's cleaner. So I think we're seeing the results that people like to take transit. And then phase two of SB 63 will show there's recommendations on efficiency measures, and then we're going to implement those in more detail after the revenue measure. So the revenue measure here in 2026 is a five-county sales tax. They're all 0.5% except for San Francisco. We've got five counties here, Alameda, Contra Costa, Santa Clara, San Mateo, San Francisco. San Francisco's got a 1%. BART is looking at $310 million with this tax measure if it passes. And there's other transit agencies that are in trouble as well, but they're getting additional funds beyond the 310. I think overall it's roughly a billion dollars for the five counties. And so with that, with the 310 million that we're gonna receive potentially, we have $375 million deficit So we still have to right-size the agency. We still need to do efficiency measures. And I'm pushing very hard for this, trying to reduce the overall organizational size from 4,600 down maybe. We have 300 vacancies. We're going to look at that. But it is a challenge to try to—you can't really cut your way out of this problem, you know, by reducing staff. Maybe we could reduce our service levels. We do have a loan that was offered by the state. So the loan that we got from the state would cover the time period, you know, after the tax measure. Then, you know, the taxes might—if it passes— The money would be flowing in, but not enough to sustain this gap that we're facing for this fiscal year. So it was kind of filling the gap until we get the funding, which really would probably come in around next summer, next July. OK, with that, so the near-term action. So yeah, so right now, we've done a lot. We did focus on the customer tremendously over the last eight years. You could even look at the Clipper 2.0. Sometimes we have problems with Clipper 2.0. Sometimes it doesn't work. We have to use our credit cards. But now you can tap and go. You can use your credit card. I used my credit card today. I went to the Levi's Stadium, saw the Australians out there cheering for their team. That's happening at 7 o'clock right now. I think Australia and Paraguay is out there. at the Levi's Stadium. It's very exciting. So we've got the new fare gates. It's clean. It's safe. It's just a tremendous experience to take transit now. The event is happening right now, but they went down to Milpitas, and then they took light rail to the Levi's Stadium in Santa Clara. So you can see how we're working together to try to get the rider experience and basically circle the bay with our transit partners. And then... The clean and safe, I would say we implemented steam cleaning. You can see the people out there cleaning the stations tremendously. It's a huge difference. And I think I'm really proud to see the police officers. We always want to see the police officers out there. I would call that like a beat cop. You know your officer. You want to have a relationship. They're not just out there patrolling and not talking to anyone. We want to have that kind of connection. And so I think with all of these measures, we're seeing the difference. So right now we've got the best case, the measure passes, the worst case, the measure fails. And we're gonna start cutting this coming November if it doesn't pass. So this is the worst case scenario. So I don't really believe this is gonna happen, but I think what would really happen is we have a new governor and we would go to Sacramento and we would ask for some funding. But this is the worst case that we got no funding and we're on our own. This is, you know, the extreme. So we would cut 70% of our service. We would stop service at 9 p.m. We did that during COVID crisis. We stopped service at 9 p.m. at that time. A three-line service. So you've got Dublin. You've got our line over here. It's the orange line. And then you've got the yellow line, which is really coming out from Antioch all the way out to Daly City. Then we would look at increasing our parking by 50% and these tremendous layoffs. Again, this is the worst-case scenario. I don't even think this would really happen, but it depends on if we received aid from the state, if it didn't pass. But we don't know what's going to happen with that. That's really uncertain. Okay. Oh, World Cup. Here we go. The World Cup. This is really exciting. We're doing late-night express trains, so... I think the trains were going like past midnight and only at certain stations. So people are really coming from all over. I mean, when I got on the train today, they were coming from San Francisco. It was packed. And mainly Australians were in there. But it's just a great feeling to have... The international community recognized the Bay Area. I don't know if you've seen the World Cup on TV, but it says San Francisco Bay Area on the Levi Stadium. And I'm just like, oh, my God, this is worldwide. It's so exciting. So these kind of events and having—and we're basically addressing these events with longer trains, express trains. And I think people weren't even asking questions. People are just following the crowd. They're easily going in and out. They don't really look at the maps. I think they kind of know intuitively how to get from A to B. So it's really exciting. And that's it. So if you have any questions, we'd be happy to take them. Sure.

Colleagues, questions? Council Member Contaccio?

Hi, actually, thank you so much for your presentation. I just wanted to also add that as a teacher, we recently brought 120 kids with us last month on a BART ride from Alameda County into San Francisco to see the Exploratorium. It was very clean. We were able to get there safely. And we did see a lot of police officers there. They were really friendly with the kids. They gave out stickers to the children. The students were really happy and the parents were happy. So I just wanna say that. That's great feedback. Thank you. Yeah, it's a really great job. It was very clean too and the kids were able to find seats. Thank you. Thank you.

Council Member Gundahl.

Thank you. Thank you for the excellent presentation. It's very interesting. I'm particularly struck by the tap and go system. So I really think that's great. And I hope that there's data that, in terms of trips, of where the origin comes, that obviously you can't attach it to an individual, but I hope that we'll be able to, down the road, be able to tell how many BART trips start from households that are in Newark's. Because we right now don't, we only know sort of station boarding, so I hope at some point we have that information. That's just a wonky...

Yeah, I'm not sure how to look into that.

So we don't have the ability to track Clipper to like an individual person back to like an individual address. And I think that that's true both with the tap and ride system and a credit card as well as like where that, you know, Clipper Card is registered. That's for people's personal information privacy. But we do have the numbers of where they go in terms of stations that they're tapping on. It's very popular at SFO, the number one station. And it's about 10% of our rides overall.

I UNDERSTAND AND THE FRUSTRATION HAS BEEN NEVER KNOWING OF THOSE FREEMONT OR UNION CITY STATIONS HOW MANY FOLKS ACTUALLY COME FROM NEWARK. AS YOU KNOW WE DON'T HAVE A STATION IN NEWARK.

WE DO HAVE SOME STATION PROFILE DATA THAT WE WOULD BE HAPPY TO SEND TO YOU ABOUT YOUR SURROUNDING STATIONS THAT SHOW WHERE PEOPLE TRAVEL FROM BASED ON SURVEYS. SO WE WOULD BE HAPPY TO SEND THAT TO YOU.

I APPRECIATE THAT. And otherwise, just really appreciate the changes you're making. And again, thank you for coming and making this presentation. Thank you.

Thank you, Council Member. And thank you, Mayor. This is an exciting time for BART, and I hope that you see the difference. And thank you for your feedback. So please email us and contact us if you have any questions about that.

Great. I have a couple comments. One, I rode BART the first day it opened back in October of 1971 and was fearful when it first went under the bay, but I'm here to still talk about it, so that's good. I share Council Member Grindahl's comment because we don't have a BART station here in Newark, and I certainly was... a barrier resident when I saw Bart build the extension from Hagenberger to the airport. And I know that costs quite a bit of money. I would certainly like Bart to consider in the future running a similar line from either Fremont or Union City to Newark because it's one of those communities where we're located and you have folks that live in Palo Alto, Menlo Park and those areas that would undoubtedly WELCOME A BART STATION CLOSER TO THEIR HOMES BECAUSE I THINK THE CLOSEST ONE ON THAT SIDE OF THE PENINSULA IS UP IN MILBRE. IS THERE ONE CLOSER TO MILBRE?

NOT FOR THOSE FOLKS. YEAH.

SO I KNOW THAT BART IS CERTAINLY DEALING WITH SOME FINANCIAL CHALLENGES. AND THESE ARE NOT TWO-YEAR PROJECTS. THESE ARE 5, 10, 20-YEAR PROJECTS. SO I WOULD CERTAINLY LIKE THE BART BOARD TO CONSIDER LOOKING AT A STATION HERE IN NEWARK IN THE FUTURE. And this on a messaging standpoint, everybody recognizes the importance of transportation and the value that transportation brings to a community. I don't think anybody up here would disagree with that. My only concern with BART is the messaging. I think it doesn't sell the product. when you talk about these are the things that are gonna happen unless this measure is passed by the voters. I think your discussion early on about the benefits, clean stations, you know, fares that are stations where you can't just simply walk on through, I think you've made a number of improvements over the last few years that make BART more of an attractive mode of transportation than it was earlier. So my suggestion to you as you go out and message communities, talk about all the positive things that BART does and all the positive things they bring to community, all of the housing and retail that's been built around BART stations to accommodate convenience for those folks that live in and around those neighborhoods. I think you're going to go a long way further in terms of talking about the positives versus the negatives in terms of closures and this and that. Most voters don't want to hear the negative. They want to hear the positive. Just a suggestion. Other questions or comments? This is a presentation. Do we open it up for the audience to comment, Mr. Bennu? Anybody in the audience who would like to comment on the presentation from Bart, please feel free to raise your hand and come forward. Yes, former council member Lily May. Yes. So, real...

Good evening, I was just gonna say, as you know, Fremont is home. Mayor May, I apologize. It's okay. But you were a council member one time. Yes, I was.

Thank you.

No, I just wanna say thank you for making this presentation. I hope that I would echo some of the comments just as a constituent and a community member for the past 30 some years. I think that people wanna be able to take the transit, having it reliable, having it affordable, having it dependable is a big piece of it. But it's also from our side. I see they're having discussion tonight about budgets. And if we're building things like transit-oriented development, which I've shared with all of you many times, it's hard for us to build 5,000 units of housing, a new school, a new hospital, and all these other things, and then be told that we might shut down the BART station. And so I've said this, and I've canned it, probably not very... popular, but as a TOD without the T is just OD. And so I'm worried that, you know, we're overdeveloping. And if you don't help us in terms of we've made commitment as a city, as a community, as a region, to bring jobs, to bring people and to bring opportunities, and it'd be very bad faith, I think, to pull that from the road. It's like the rug under for people. So that's all I was gonna say. Thank you so much.

Other comments from the audience? Board Director Ames, I want to thank you for coming to Newark. Certainly your representation of our community is greatly appreciated. And again, I speak for many here in the audience. We appreciate efficient, attractive, clean transportation, and BART has certainly moved in that direction. So thank you.

Thank you. Thank you. We welcome your comments. Thank you, Mayor.

Thank you. Ladies and gentlemen, I'm gonna now return to the public comments section on the agenda. This is an opportunity for anyone to speak on items that are not currently on the agenda. Colleagues, I'm gonna ask for a little bit of leeway in this area here. We have a number of folks that may wanna speak as a result. of the discussion tonight we're gonna have on the business tax license. And of course, that's really at the end of the agenda. With your approval, I'd like to give those folks an opportunity to speak to this item under public comment, if I can get your approval.

If you need a motion, I can make a motion to support that.

I appreciate that.

I'll second that.

Okay, let's vote on that opportunity. Thank you, colleagues. So this is public comment section. Those that are here to speak on items that are not on the agenda are certainly entitled to come up and speak. Anybody that would like to speak on the business tax license who have taken time out of their day to speak on that item are also invited to do so as well. Public speakers. Yes, Lupe, come on forward.

Hello, how you doing? Good evening. Good evening. I'd like to speak on the business license. So good evening again. My name is Guadalupe Lopez, owner of Artiega's Food Center. Thank you for the opportunity to speak here. I understand the city is facing budget challenges, and I appreciate the difficult decision before you. However, I especially ask you reconsider the proposed business license tax increase. Businesses in New York are struggling with rising labor costs, higher insurance premiums, increased utility bills, credit card processing fees, and growing regulatory compliance expenses. In addition, permits to new businesses are too long, creative, and uncertain for those trying to invest in our community. Under the current business license structure, a business like mine pays approximately $2,461. Under the proposed 043 gross receipts tax, it will increase to $4,730. a 92% increase. Grocery stores operate on very thin margins, often less than 1%. This proposal taxes on gross sales, not net profits. I also ask the council to consider newer competitors. Neighboring cities generally have much lower business license. Higher fees make newer less attractive for businesses to invest, expand, and create jobs. We are asking businesses to pay nearly double. I will respectfully ask. What additional services will businesses and residents receive? Will City Hall restore pre-COVID operated hours and service levels? Will more employees return to work in person so businesses receive better access and faster service? How will this new revenue improve permitting public safety and economic development? Local businesses more than taxpayers. We create jobs, support schools, non-profits, and sponsor community events, making Newark great. Every additional cost reduces our ability to invest in employees, improve our businesses, and keep prices affordable for local families. I also ask you to consider grocery stores and similar essential businesses to be placed in their own category. recognizing the unique challenges and thin margins we operate under. I respectfully ask you to reject this proposal or pursue a better solution that meets the city financial needs while approving businesses that invest in Newark for decades. I also would like to quickly touch on the new business that was being approved, TNT. That definitely is going to impact every grocery store that is here. We have approximately 16 to 18 grocery stores. We have 48,000 people living in the city. given an average of maybe three people per household. So that brings you about 16,000 families. If you multiply by expenditure, that every family does between $9,000 to $10,000 per year on food, that only gives $140 to $160 in budget. So if you divide between those stores, that only reduces the amount that each person can spend per store, but it also reduces the items that they're going to buy. It reduces the people that visit those businesses. So I project that it will reduce the existing businesses revenue by 10 to 12% per store. Can they afford to survive on that? Absolutely not. Like my business already lost 5% to Chavez Supermarket. So if you add an additional 10 to 15% Can I survive? I don't know. So please reconsider to bring businesses that are required in the city as opposed to providing and creating a lot of stores of the same category on one city.

Thank you. Thank you very much. Other folks under public comment? Please come forward. Yes. Do you want to be organizing this one first? No, no. No particular order.

Hello, everyone. My name is Yoyo Ye. And as many of you know, I'm the Newark project lead for Urban Forest Friends. And many of you have come to our tree planting events to plant trees in Newark. Of course, I'm here tonight to talk about trees. The opposite of planting trees, though, which is cutting down trees, which is happening in our Civic Center parking lot. And I understand that the trees in our parking lot are going to get cut down to put in a solar array. And as an environmentalist, I definitely support solar. I think my problem here is that The investment for those trees in this parking lot was made only five years ago. And while I understand maybe five years ago we didn't know there was going to also be a solar project, I just want to express to you how much was potentially invested. You know the full quote of how much we paid for those trees and how much we're going to lose. So I had just an estimate. But my estimate is like... So it's like, why did we invest? My estimate was about $100,000 to put in those trees and those bioswales that are going to get cut down. And why did we invest that money five years ago without planning ahead to know that they were just going to be cut down in five years? Because if you had come to me in 2021 with $100,000 for trees, we could have done so much. But you put the $100,000 into this beautiful forest in the parking lot. They got to grow for five years and now we're just going to cut them down. That just feels like bad planning. So I have three requests tonight from the city council. The first one is just please plan further ahead if you can. Please don't put in investments. if you're just going to pull them out five years later. And please account for the value of nature. The trees are not valueless. Buying those trees costs money. Installing those trees and the irrigation costs money. We also have four bioswales in that parking lot that were designed to filter water, like specially designed plants and soil. to filter water before it goes into storm drain, and those will also be destroyed when the irrigation is cut by the solar panels. So it's not just trees, it's also the bio soils. So first request, please, please plan further ahead. Please account for the cost to nature of new projects. My second request is that in the municipal code, before a tree is cut down in the city, the city is supposed to put a notice on the tree at least 10 days in advance to let people know that's gonna get cut down so anybody who is against the cutting down of that tree can contact the city. And that was not done at Silliman and that has not been done here. We already have one tree cut down here. There was no signs. Please follow the municipal code when it comes to cutting down trees. And my last request, there's been about 40 trees already cut down at Silliman to make way for those solar panels there. These were full-grown mature trees and here there's gonna be 30 trees cut down, full-grown healthy mature trees. The city code also says that for private owners who cut down trees, they must replace them. So I request city, please replace trees, the trees, the 70 trees that are gonna be cut down with 70 additional trees. And it's hard to replace a full grown 20 foot tall tree with just, it's not a one-to-one replacement if you just put in a small one. So if, I know we have a budget crisis, but like, please replace the trees that are being cut down. Thank you.

Thank you for your comments. Mr. Bennu, just for clarification, if I may, the requirement for a tree to be posted and a permit to be issued, is there a certain size tree that would necessitate that type of notification? And I would imagine the city being a municipality, we may be exempt from our own code in that respect. I don't know if you want to comment on that.

I'd have to look that up. There is a general diameter minimum to meet that threshold in order to post. I don't recall it at the top of my head. I'd have to look that up.

I know in San Jose, we required a permit if the tree was three feet in circumference, two or three feet above the ground, and none of these trees in the parking lot meet that standard. I would imagine Newark is probably similar. Mr. Gandoglia, recollection on that item?

I HAVE AN INITIAL COMMENT.

GREAT.

OR MORE LIKE A QUESTION. I DON'T EXPECT YOU TO HAVE THIS OFF THE TOP OF YOUR HEAD BUT IT WOULD BE NICE TO KNOW WHAT THE PLANS ARE FOR THOSE BIO SWALES AND WHETHER OR NOT THERE ARE SOME LOWER AND SHADE TOLERANT VEGETATION THAT WILL BE GOING IN OR BASICALLY WHAT THAT PLAN IS. AGAIN, NOT EXPECTING ANYTHING You didn't know that on the top of your head, but I would appreciate, I think the council would like to know sort of what that plan is. So if that's okay, I appreciate it. We can follow up.

Great. Other folks on public comment? And again, as I mentioned at the beginning, this includes folks that want to make public comment regarding the business tax license item that's coming later in the agenda. Former Mayor Lily May. All right.

So I'm going to make a comment on the agenda item that you mentioned, the business licensing ordinance. So good evening, mayors and council members. I'm proud to be partnering and talking to the Newark Chamber of Commerce, as I'm genuinely excited to be part of the community during what I believe will be a really pivotal moment in our region. I come to this with two lenses, years I've spent in corporate world as well as time serving as a mayor. And when I look at a proposal like this, I ask questions which are, what does this mean for the businesses that are already here? And also betting on Newark and what does it signal to the businesses you want to attract? And tonight, the answer to both those questions, I think, are the same for me, at least, looking at this. This is a step forward, and I think Newark may want to take this, be ready to take this. Let's talk about where we are regionally, as context does matter. The East Bay is seriously experiencing some momentum, which is a great thing to see. Companies are looking to the South Bay Corridor, and site selectors are paying attention to cities who act COHESIVELY AND CITIES WITH MODERN INFRASTRUCTURE AND CLEAR PROCESSES AND A BUSINESS CLIMATE THAT SAYS WE WELCOME AND WANT YOU HERE. NEW YORK HAS EVERY REASON TO BE ON THE TOP OF THAT LIST AND I KNOW THIS HAS BEEN SOMETHING THAT'S OVERDUE THAT HASN'T BEEN SEEN I THINK SINCE 1970, IS THAT CORRECT? And so I think you have a great location, the workforce, the access, the land, and also a terrific community. And what this modernization does, it will make sure that the administrative framework matches the opportunity that's in front of us. The data and the attachment A that showed the spreadsheet backs up that information. I know under recommended or option two ordinance, the rates remain still some of the most competitive in the entire region, meaningfully lower than Fremont and San Leandro, Union City, and proposed rates that are being evaluated for Hayward. For example, a restaurant doing 625,000 in gross receipts pays $251 here in this proposal versus 962, and I just did analysis in Fremont. A small home-based business is still $25 and we're not talking about burdening our businesses, we're talking about building an infrastructure that's fair. I will take into account that we just heard the comment from one of your businesses that's a long time and that's something that you may wanna consider when it comes to the categories and how those are being evaluated and the impact because I know they've also faced increases in terms of the employment wages that they've been given depending on different legislative bills. But with that, I think that building a structure that is fair, transparent, and positioned in Newark as a place for business where business of all sizes can take roots. And from someone, again, who's managed corporate, city, and agency budgets, I can tell you plainly that I think that cities that invest in themselves have a good return. So when your streets are better maintained, when the services are responsive, And when the city feels alive and well-run, I feel that people, businesses notice, employers notice, developers notice, families notice. And this revenue modernization generates something that isn't just an expense on the business community, but it's hopefully a fuel for this kind of city that makes businesses wanna choose Newark. And so I feel that while you're asking for money, I think it's also very important to be accountable to report out. And I know there were a lot of questions about what does that mean in terms of permitting and other services that would then also help support your businesses to ensure that there's a balance to see with the return. So in closing, I just want to say that what gives me confidence is how this was done. I know the staff went out and talked to the businesses and listened. I saw that also in the handout. It was multilingual, which I think is very important. We talked about that earlier and having accessibility to the community. And that reflects a genuine balance. But I think that collaborative spirit is exactly what you need at this moment. So I hope that you'll continue this and you'll reach out to the other businesses that have not had the opportunity to speak. And I hope that you're not waiting on this moment. And I hope that the moment's right for you now. And that make sure that you have the right tools and resources and the business climate to hopefully fully embrace it. So I just want to share that. Thanks.

Thank you very much. If you would like to speak to the business tax license, you can either do it now or you can do it when the item comes up and staff makes their presentation. Please come forward. Welcome, Ms. Montes, the president of our chamber.

Hello. I'm going to be commenting on the New Works Business Act license. So my name is Debbie Montes. I'm the president of the New York Chamber of Commerce. And during my day job, I'm the area director with Hilton and Marriott overseeing hotel operations here in the region. Tonight, I'm really here in both of these roles. Honestly, from either angle, I arrive at the same place. We are happy that the city is updating Newark's business license tax. Here's what I hear from our chamber members. The current system is confusing, it's hard to figure out, and it hasn't really been touched in a while. In 1970, Newark's business community today looks completely different than it did back then. We have businesses operating in ways that didn't even exist 50 years ago, and we're still asking them to fit into a structure that was never designed for them. What I want people to understand that this is not just about raising taxes for businesses. This is about cleaning up a system that is overdue for a refresh. Making it simpler, fairer, and easier for everyone to understand. We are delighted to see that the city staff came out, talked to businesses, sat down and listened, and our members noticed this. From my side of things in hospitality, I can tell you that the health of the city directly affects how we do business. When Newark is well maintained, services are funded, when people feel good about the community, guests notice, visitors come back, and businesses want to relocate here, and it all connects together. The survey results show that voters are open to this when it is explained clearly and honestly, and I think the business community has a role to play in that conversation. We can speak to our neighbors about our well-run city that affects us in our lives and work here. So on behalf of the Chamber, I want to say we support moving this forward to the November ballot. We are committed to staying engaged. We are grateful to this council for approaching this the right way and as a partner with this business community, not just as a transaction. Thank you so much for listening to me tonight.

Thank you for coming tonight, Ms. Montes. Thank you. Appreciate you. Other speakers under public comment? Again, if you wanted to speak to the business tax license, you'll have an opportunity again later on in the agenda. So I'm gonna go ahead and close the public comment section and go to the consent calendar. Now the consent calendar is considered to be routine and may be approved by one motion. There will be no separate discussion on these items unless there is a request by a council member, staff member, or member of the public to speak to an item separate discussion and action. Is there anybody in the audience that would like to speak to any of the items that are on the consent calendar? I'm gonna read the consent calendar, and if you would like to subsequently speak on any one of these items, feel free to let me know at that time, because there are 10 of them. One is the approval of audited demands. Two is the approval of the June 11, 2026 City Council minutes. Three is adopt a resolution authorizing the city manager to execute two master funding agreements with the Alameda County Transportation Commission. Four, adopt a resolution authorizing the city manager to execute a multi-year software as a service agreement with ClearGov Inc. for cloud-based budget development, capital improvement planning, performance management, reporting and transparency tools in the amount not to exceed $292,000. Five, adopt a resolution to accept bid number 2026-518 and award a contract to PC Solutions and Integration Incorporated for the CORA network equipment replacement project in the amount not to exceed $350,476.11 and approve a budget amendment. Six, adopt a resolution authorizing the city manager to execute a three-year cooperation agreement for fiscal years 27 through 29 with Alameda County for participation in the Alameda County Urban County for the Community Development Block Grant CDBG program. Seven, approval of the plans and specifications and adoption of a resolution for acceptance of bid and award of a contract for the base bid and additive alternate bids number eight and number nine. to G. Bartolo and Company Inc. for fiscal year 2026, annual asphalt concrete street overlay program project number CIPA10005-FY2026 phase two in the amount of $1,042,000. Eight adopt the resolution approving the Second Amendment to the Memorandum of Understanding with the Alameda County Environmental Health Department, ACEHD, for the inspections of tier one and tier two commercial edible food generators and nine approval resolution authorizing the city manager to execute a second amendment to an agreement with the Alameda County Fire Department for fire trucks and service in an additional amount not to exceed $400,000. in amending the budget, and finally adopt a resolution approving a third amendment to the Contractual Services Agreement with Kachina Landscape Management Inc. to provide landscaping services in an additional amount not to exceed 120,000 through October 31 of 2026. Folks, is there anybody that wanted to pull any one of those items for comment, clarification, discussion? City Manager, did you want to pull any of those items?

Not this evening, Your Honor.

Colleagues, any item that you would like pulled from the consent calendar? Council Member Grindahl.

No, I was going to make a motion when you were ready.

Thank you, I'm ready.

Also, I think you have to drink water after all that. So I'd like to make a motion to approve the consent calendar.

I'll second. A motion from Council Member Grindahl, seconded by Vice Mayor Jorgens. Please vote. The consent calendar passes unanimously with four ayes, with Council Member Eve Marie Little absent tonight. Ladies and gentlemen, we're now gonna go to public hearings. The first public hearing is to conduct a public hearing and adopt a resolution approving the 2026-2031 Capital Improvement Plan. Mr. Bennoon?

Yes, good evening, Your Honor and members of the Council. I am pleased to report that staff has crafted a five-year capital improvement plan for Council's adoption this evening. Transitioning from a two-year CIP to a five-year CIP, while also transitioning to a new platform, was by no means an easy task. Multiple staff members from various departments participated in this demanding process, so I would just like to take a moment and publicly acknowledge them and thank them for their extraordinary efforts and work. For tonight's presentation, our city engineer, Mr. Miki Sabota, will briefly describe the changes that have been made in response to feedback we received from the council at the previous CIP work session. Similar to the past, we have one main presentation, which is this particular agenda item. That's item E1. And then we have three separate agenda items containing projects that involve conflicts of interest. Under this main presentation, staff will recommend that the Council approve the five-year CIP document with the conflicted projects being omitted. With that in mind, I'll pass it over to City Engineer Sabota. Mr. Sabota, you have the floor.

Great. Thank you, City Manager. Good evening, Honorable Mayor, Vice Mayor, and Council members. We've made it. This is the finish line. I know you've seen me multiple times up here presenting introduction of the five-year CIP draft projects, the draft CIP itself, and we finally made it to this item tonight, which is a presentation of the final capital improvement plan. Like City Manager had mentioned, I do want to take time to acknowledge we have several staff members in the audience as well. This was a truly collaborative effort over the past eight months. I do really want to thank and acknowledge staff for their tremendous effort putting together this new document. This is our first ever five-year CIP. I want to acknowledge and recognize the executive team for providing leadership. through this great process and of course City Council for providing policy direction and guidance to get us to where we are today. I have no formal presentation slides. The staff report does cover the changes that were made since the last presentation back in May where we presented the draft CIP. I did want to highlight a couple of big-ticket items. The first, and this is per direction from City Council, we did update a lot of the narrative or project narratives. We included information like estimated start times or completion times for some of the projects. We added narrative on the status of several active projects. One thing to note in the staff report is that we did take the CIP to the Planning Commission earlier this month per state requirements, and Planning Commission did find that the capital improvement plan is in conformance with our general plan. Some of the other changes, the Bayside TOD pedestrian bridge per council direction. We did adjust or clarify that the $2.8 million for this project will be coming out of the TOD development fees, not necessarily the traffic impact fees for this particular project. And we did clarify that we would do an analysis or feasibility analysis for this bridge before we go into full design. We also had a police pursuit intervention technology program, CIP, that staff has moved over from CIP into the police operating budget. We felt that it's more appropriate as a operating project as opposed to a CIP. That pretty much concludes my presentation. I'd be happy to answer any questions.

Go ahead and open up the public hearing. Is there anybody in the audience that has questions, comments, suggestions regarding the CIP? As mentioned, we've seen this item now several times. I wanna thank Mr. Mnuchin and city staff for all the hard work that they've done. And I also wanna commend city staff for putting us on a five-year CIP. A two-year CIP made no sense when you consider how long it takes to design, develop, fund projects. I think a five-year CIP is more in line with what the residents can expect in terms of completion on some of these projects. So real credit to city staff for bringing that forward to us for consideration. Anybody in the audience who would like to speak to this item? If not, I'm going to go ahead and close the public hearing and return to my colleagues for questions, comments. Council Member Contoncio.

I just wanted to thank you and everyone else too in putting together the five-year CIP. It does encompass many things for not only our younger citizens of Newark, but also everyone in the community, like the Cultural Arts Center, the parks, what are we gonna do with the monster? In fact, I just visited him a few days ago when we were taking some photos. But I do appreciate the the financial responsibility and layout so that everyone here in Newark knows what to look forward to. Thank you.

Thank you.

Vice Mayor. Yeah, I just want to commend staff as well. I think it's obviously been a long process and we've ended up at a pretty remarkable place with this document. So there's a lot of credit to go around and it should be taken because this is a very good place that we've put the city in.

Council Member Goodell.

THANK YOU, MAYOR. FIRST I HAVE SOME QUESTIONS, THEN I HAVE SOME COMMENTS. SO FIRST OF ALL, THE WRITTEN STAFF REPORT MAKES NO REFERENCE TO MY REQUEST TO FUND AN EDUCATION ELEMENT TO THE GENERAL PLAN. THERE'S JUST SIMPLY NO DISCUSSION ABOUT IT WHATSOEVER. We need to be taking formal votes to get that included or whatever, but to simply have it, to have something that's, in my opinion, the most critical element of our community and in line with one of our goals and missions is to have it just completely ignored, I think is inappropriate. So can you tell me how it is that that discussion isn't mentioned at all?

Go ahead. It's my recollection that council did not direct staff to specifically include that as part of the CIP. Now, the update to the general plan is going to be an extensive, long, drawn-out process that will involve multiple presentations and involvement with city council. So I think it is probably more appropriate that when that general plan update kickoff starts that that discussion happens in terms of what should or shouldn't be included as part of that process.

And when would you anticipate that to come to council for initial discussion on the general plan, if we can kind of get a sense on that?

Approximately three years. Three years? 2028? 2028?

TWO YEARS-ISH. SO SECONDLY, THIS IDEA OF THE OVERCROSSING THAT CONNECTS TWO SECTIONS OF THE BAY TRAIL THAT IS GOING TO HAVE A FEASIBILITY STUDY GO FORWARD, THAT'S TRUE OF MOST PROJECTS, PARTICULARLY LARGE PROJECTS, ISN'T THAT TRUE? FOR EXAMPLE, THE COMMUNITY CENTER PROJECT HASN'T REALLY BEEN DETAILED. EXACTLY WHAT WOULD HAPPEN? ISN'T IT A TYPICAL PART OF THE PROCESS THAT FOR A PROJECT THERE BE SOME SORT OF FEASIBILITY ANALYSIS? SO FIRST OF ALL, CAN YOU ANSWER THAT QUESTION?

YES, FOR LARGE PROJECTS, USUALLY THERE'S SOME SORT OF FEASIBILITY ANALYSIS TO JUSTIFY ITS NEED.

SO HOW IS IT DIFFERENT IN THIS CASE? WHY IS IT SPELLED OUT SPECIFICALLY?

Many of the projects that are in the CIP, if you look at the parks projects, the facilities projects, those had feasibility studies in terms of the master planning that was put together many years prior to today that analyzed the need for those types of projects. The TOD pedestrian bridge, it's my understanding there hasn't really been a study particularly for that one project.

It was included in the Bay Trail realignment study that was approved by the City Council. It was also included in the specific plan, which was approved by the Council. So I don't think it's accurate to say it hasn't been studied and analyzed. So I just wanted to correct that. SECOND OF ALL, THERE WAS DISCUSSION ABOUT WHETHER OR NOT IT WAS APPROPRIATE TO MOVE FORWARD ON A $10 MILLION SIGNAL INTERCONNECT PROJECT. THE COUNCIL DISCUSSED THAT. THAT'S THE ITEM. I'M SORRY. I APOLOGIZE. Now to my comments. I think given how important the education system is to our community, how it was indicated as part of our goals and objectives, I think it's unconscionable that we don't throw a few dollars, less than a tenth of a percent, or an eighth of a percent to help analyze and get us started on working together with the school district to improve things. So I think it's, based on that, I believe this capital improvement plan, although a laudable effort, does not really align with the vision of our community, in my opinion, and I won't be supporting it.

I absolutely will be supporting the CIP. It's a roadmap in terms of the priorities that this council has set forth in terms of improvements that we want to make to our community, including parks and other infrastructure throughout the city. I thought we did take, Mr. Bennu, correct me if I'm wrong, I thought we did take a vote on Council Member Grindahl's proposal to include I think you had estimated, Council Member, about a $200,000 commitment from the CIP to go towards the idea of putting forth an educational component in the general plan. Did the Council not weigh in on that?

Yeah, a few things. First, I just want to make it clear, staff's understanding was that direction was provided from the Council to staff to not include that educational element in the CIP that would be approved in the public hearing, and that's what we've done tonight. And then in terms of the qualifiers with respect to that pedestrian bridge, again, that was the direction that we had received collectively from the council. I'm going to pass it over to Ms. Zaworka. I believe she had the opportunity to review the video and also, well, she took a part in the preparation of the minutes. So perhaps Ms. Zaworka can speak to that.

Sure. Thank you, City Manager Benun. With regard to your question, Mayor, of the discussion on the education element as being part of included in the CIP, it is in the minutes, the City Council meeting minutes in both April 23rd and May 28th. WE DID NOT TAKE A FORMAL VOTE BECAUSE IT WAS NOT REQUESTED. HOWEVER, DURING THE MEETING YOU HAD ASKED EACH COUNCIL MEMBER IF THEY WERE TO SUPPORT OR NOT AND EACH TIME THAT WAS FOR WHO INDICATED NOT SUPPORTING INCLUDING THE EDUCATION GENERAL PLAN ELEMENT IN THE CAP. one showing support and so how we captured that in both the April 23rd and May 28th minutes was just collective as a council we stated that there was not support for adding it into the CIP and therefore we did not include it in the staff report ABOUT WHAT CHANGED IN THE CIP.

CORRECT ME IF I'M WRONG, THE CORRECT ME IF I'M WRONG, THE TOTAL VALUATION OF THE CIP FOR TOTAL VALUATION OF THE CIP FOR THE NEXT FIVE YEARS IS? THE NEXT FIVE YEARS IS?

APPROXIMATELY $279 MILLION. APPROXIMATELY $279 MILLION. $280 MILLION.

And so this council has weighed in on not only the educational component to the general plan as Councilman Grindahl had requested, I think it's reasonable to defer that discussion until the actual general plan comes back to the council for further consideration. That's reasonable. Secondly, the Bay Bridge that we've discussed, again, the council took a position on that. I find it alarming, in all honesty, ladies and gentlemen, when we're talking about really the capital improvements to our community that are at $279 million that a council member's gonna vote no on the entire CIP. And I'm happy Council Member Grendel to take a specific vote tonight on your request for setting aside funds for an educational component to be attached to the general plan. I think the vote will be what it has been in the past, but I find it unconscionable that as we're looking at really significant improvements to our community, we're talking two fire stations, that are critical in terms of preserving and protecting our citizen when it comes to public safety. We're talking about a community center, arts center that our constituents highly or anticipation of seeing in the near future. We're talking about significant road and infrastructure improvements throughout our entire city. To vote no on such minor issues that at some point in the future we'll come back to this council for consideration, in my mind is not representative of the view of the community moving forward. So do we need to take a vote on this item here before we get to the separate items, Mr. Bennone?

Correct, Mayor. There is a resolution that was prepared and attached to the staff report that would approve the vast majority of the capital improvement plan.

I'm going to move staff recommendation on this.

Thank you, Vice Mayor Jorgens. Second. By Council Member Cantancio, please vote. And the CIP for the next five years at $279 million was approved by the council on a three to one vote with council member Eve Marie Little absent this evening. Thank you for the hard work. Mr. Mnuchin, thank you to all the staff because I know that it was mentioned that this has been an eight month project and I'm really pleased to know that we're gonna see annual updates to the CIP as to projects that we approved tonight that are have been completed, in the process of being completed, or in the feasibility stage. And so I'm excited that we're gonna continually see updates in that regard. And again, thank you to all the hard work that folks did on this item. The next item is E2, and I understand Vice Mayor, let me read the item first. It's a public hearing and adopt a resolution approving the Thornton Avenue overlay phase one, Interstate 880 to Olive Street, 4,070,000. traffic signal interconnect construction, 10 million, projects in the 2026-2031 capital improvement plan. And I understand, Vice Mayor Jorgens, you need to recuse yourself on this item.

Yeah, as I have done each time that we've discussed this item, I will be recusing myself. I have a real property leasehold interest within the proximity of Thornton Avenue and the traffic signal interconnect project. That real property leasehold interest is my residence.

City Manager, I have a question as Vice Mayor has left the room, because there's really two items on here. One is the Thornton Avenue overlays phase one, and the other is the traffic signal interconnect construction. Did the Vice Mayor need to recuse himself on both those items or just the Thornton Avenue overlay?

Our understanding is that it's for both items.

For both items. Okay. Thank you.

Yes, good evening, Your Honor, members of the Council. This item is for two conflicted projects, namely the Thornton Avenue overlay project phase one, and secondly, the traffic signal interconnected project. City Engineer Mickey Sabota will give a very brief update, as my recollection is that we have very few changes to this from the last work session. Mr. Sabota?

Great, thank you, city manager. Again, still excited to be here. One minor change, and it has to do with the traffic signal interconnect project, and this is, again, direction per direction from city council. We did add narrative that staff will be exploring, hopefully, a much cheaper wireless version to accommodate the same task as opposed to a hardwire system before we go out and expend the $10 million for a hardwire system. And so that narrative was added in the project NARRATIVE AND THAT WAS THE ONLY SIGNIFICANT CHANGE IN THE TWO PROJECTS. THIS CONCLUDES MY PRESENTATION. I'D BE HAPPY TO TAKE ANY QUESTIONS.

AND AGAIN LADIES AND GENTLEMEN THIS IS A PUBLIC HEARING ON THIS SPECIFIC ITEM SO I'M GOING TO GO AHEAD AND OPEN UP THE PUBLIC HEARING ON THIS ITEM. IS THERE ANYONE THAT WOULD LIKE TO SPEAK TO ITEM E2 AND YOU HEARD WHAT THAT ITEM WAS DESCRIBED AS? SEEING NOBODY I'M GOING TO GO IN CLOSE THE PUBLIC PORTION OF THIS AND ASK MY COLLEAGUES FOR COMMENTS.

Why wouldn't, excuse me, why wouldn't the Signal and Interconnect project simply be removed, given that it's so out of scale, it's a $10 million project, as opposed to, SOME SORT OF LANGUAGE THAT WILL BE LOOKED AT IN ANOTHER WAY. SO WHY WOULDN'T, I MEAN, WE'RE GOING TO BE LOOKING AT THIS CAPITAL IMPROVEMENT PLAN EVERY YEAR, MAYBE CERTAINLY EVERY TWO YEARS WHEN WE DO OUR BANNED BUDGET AND EVEN MAYBE SOME MID CYCLES IN THERE. SO WHY WOULDN'T WE SIMPLY REMOVE THAT?

This was an existing project that had gone back at least a couple years, so the design was actually already completed. Certainly at the pleasure of council, if they want to remove this particular item from the CIP so that staff can still do the research, we can certainly entertain that.

Thank you. That's all I have.

I'm going to support this project, and I won't ask the audience for a show of hands. How many of you are tired of driving down Cherry Street or Newark Boulevard and you sit at that signal trying to figure out why is there no traffic coming in the other direction, yet I continue to sit here? Now, the police department knows I drive a white Tesla. They know I'm not running that light, irrespective of how long I'm going to wait. AT THAT INTERSECTION FOR THAT SIGNAL TO TURN GREEN. BUT IF I UNDERSTAND THIS ITEM CORRECTLY, MR. BANNOON, WE'RE NOT MAKING REALLY ANY DECISION TONIGHT. IN OTHER WORDS, STAFF IS GOING TO EXAMINE THE BEST AND THE MOST EFFICIENT AND THE LEAST EXPENSIVE METHOD TO IMPROVE OUR INTERCONNECTIVE SYSTEM AND ALL WE'RE DOING TONIGHT IS TELLING STAFF WE'RE SETTING ASIDE $10 MILLION. This is not $10 million of city money. This is $10 million that's coming from Alameda County Transportation Commission. Isn't that correct? So it's not even our money that we're setting aside $10 million. We're setting aside $10 million and telling staff, move forward, design a project that's going to be least expensive. and gonna provide the connectivity that our residents expect to see. Because I hear this on a regular basis about people waiting at signals and we need to demonstrate to the community that this is an important issue to us and we're ready to move forward. HOW SOON WOULD YOU ANTICIPATE COMING BACK TO THE COUNCIL WITH ONE PROPOSAL OR ANOTHER PROPOSAL AS IT RELATES TO THE BEST SYSTEM TO INTERCONNECT OUR SIGNALS? WHEN WOULD YOU ANTICIPATE COMING BACK?

IT WOULD TAKE AT LEAST A COUPLE MONTHS.

And at that time, would you have an idea as to the actual cost of that project at that point as well? Yes. Okay, so we're looking at two months to really understand what's gonna be the best connectivity and what's the cost gonna be, and at that point, we can weigh in as to whether or not we think that's a good bargain for the money that we're spending. All we're doing today, we're not making any real financial decision, we're simply setting aside the money for that project.

That is correct.

Okay, any other comments? Okay, yes, Council Member Grindahl.

Just as a point of clarification, my understanding, the key, and in fact, as you had indicated in the previous meeting, the high cost item to this interconnection is not so much the signal timing, which I concur with the Mayor's statements that to the extent that the signal timing can be tuned up with better equipment or something like that, that certainly helps at the each individual's, INDIVIDUAL SIGNAL AND FULLY SUPPORT THAT, THE BIG TICKET ITEM IN THIS COST IS THE PHYSICAL INTERCONNECTION BETWEEN THE DIFFERENT SIGNALS SO THEY SINK UP. SO AS LONG AS YOU FOLLOW THE SPEED LIMIT WHICH I KNOW YOU ALWAYS DO, AS LONG AS YOU FOLLOW THE SPEED LIMIT, YOU BASICALLY GET ALL THE GRAINS THROUGH AND IT MOVES MORE EFFICIENTLY. I JUST WANT TO SAY, I JUST WANT TO SEE IF I UNDERSTOOD PROPERLY, THAT'S REALLY THE BIG TICKET ITEM HERE IS THAT PHYSICAL INTERCONNECTION. THAT IS CORRECT. THANK YOU.

WE'RE DOWN TO THREE COUNCIL MEMBERS SO I GET A MOTION AND A SECOND. CAN I GET A MOTION? I'LL SECOND IT. PLEASE VOTE. LET'S START THAT AGAIN. I'M NOT PRESSING MY BUTTON.

POINT OF CLARIFICATION IS A MOTION FOR BOTH PROJECTS OR JUST ONE OF THE TWO?

Well, they came as a ticket item.

Right. I believe the motion was to accept staff's recommendation for both items.

And that failed on a two to one vote because we need to have a majority three voting in favor of any item. And so I imagine, Mr. Badoon, that'll come back to us. What?

Well, per the city's municipal code, you would need three council members to take any action, so that's true. This item fails under the vote as tallied on the screen. The enabling resolution contains two projects, so we would recommend that a motion be made to approve the resolution minus the references to the traffic signal interconnect project. That would effectively put in the Thornton Avenue overlay project into the capital improvement plan. If that vote were to occur, that item becomes part of the plan, and then we would come back in the fall, in September, October, with the analysis on the traffic signal interconnect plan, and the council at that time can make a decision whether or not to vote on this project and add it into the CIP.

Yes, Council Member Randolph.

Given that difficulty, I can hold my nose and if you want to do a re-vote, I can support this.

On the Thornton Avenue?

On both.

On both? Okay. Can we do that? City Attorney?

Yeah. I'll make a motion to reconsider. Thank you.

Okay.

This is just on the motion to reconsider or on the item itself? It doesn't matter.

YOU OKAY WITH THE COMBINE?

YES. OKAY.

AND THAT PASSES THREE. YES, COUNCILMEMBER JORGENS, VICE MAYOR JORGENS HAD TO RECUSE HIMSELF AND VICE MAYOR, EVEN VERY LITTLE COUNCILMEMBER IS NOT HERE THIS EVENING. Ladies and gentlemen, item E3 is a public hearing to adopt a resolution approving the Thornton Avenue Complete Streets Hickory to Gateway, a $12 million project. I love that project. In the 2026-2031 Capital Improvement Plan, and I understand, Council Member Grindahl, you have to recuse yourself.

Yes. At this time, I need to recuse myself from this item because I have real property interest within the proximity of the Thornton Avenue Complete Streets Hickory to Gateway project, and that is my residence. Thank you. I'll be back.

I WANT TO APOLOGIZE TO YOU I WANT TO APOLOGIZE TO YOU ON BEHALF OF THE COUNCIL. ON BEHALF OF THE COUNCIL. WHEN THE CITY MANAGER CONTINUES WHEN THE CITY MANAGER CONTINUES TO DESCRIBE YOUR PRESENTATIONS TO DESCRIBE YOUR PRESENTATIONS AS BEING BRIEF, I DON'T WANT YOU AS BEING BRIEF, I DON'T WANT YOU TO COME AWAY THINKING WE DON'T TO COME AWAY THINKING WE DON'T APPRECIATE YOUR PRESENTATIONS. APPRECIATE YOUR PRESENTATIONS.

GOOD EVENING, YOUR HONOR, GOOD EVENING, YOUR HONOR, MEMBERS OF THE COUNCIL. MEMBERS OF THE COUNCIL. WE HAVE NO PRESENTATION ASKED THIS ITEM WAS DISCUSSED EXTENSIVELY AT PREVIOUS WORK SESSIONS. NO CHANGES WERE REQUESTED BY THE COUNCIL AT THE LAST WORK SESSION. AS SUCH, STAFF RECOMMENDS THAT THE COUNCIL APPROVE THE RESOLUTION AS PRESENTED.

LADIES AND GENTLEMEN, THIS IS ALSO A PUBLIC HEARING, SO I'M GOING TO GO AHEAD AND OPEN UP THE PUBLIC HEARING ON THIS ITEM. IS THERE ANYBODY WHO WOULD LIKE TO COMMENT, DISCUSS THIS ITEM? I'M GOING TO CLOSE THE PUBLIC HEARING, TALK TO MY COLLEAGUES. ANY COMMENTS ON THIS ITEM?

No, I'd like to echo your comments. I think it's a great project. I'm excited to see it as part of the CIP and would like to move staff's recommendation.

And I'm going to second that. Motion by the Vice Mayor, second by the Mayor. Please vote. That passes with three ayes, with Council Member Gondal having to recuse himself and Council Member Emery Little not here this evening. Thank you. I just find it interesting that the only person that does not have to recuse themself tonight is the mayor, which is no reflection on, by the way, the neighborhood the mayor lives in. You'll have your turn. So ladies and gentlemen, E-4 is a public hearing to adopt a resolution approving the Lakeshore Park new interim restroom, $80,000, and the Lakeshore Park new pathway lighting, $200,000 project for inclusion in the 2026-2031 capital improvement plan. And my understanding is Council Member Contoncio, you need to, and Mr. City Manager Bannone, need to recuse yourselves. Council Member Contoncio?

Yes, Your Honor, thank you. I am recusing myself because I have a real property interest within proximity of the Lakeshore Park projects, which is my residence.

Yes, good evening, Your Honor, members of the Council. I, too, have a conflict of interest as I own real property within proximity of Lakeshore Park. I took no participation in the preparation of the staff report.

Assistant City Manager Havorka. Thank you, Mayor and City Council members. We do have a couple of changes on this item. So City Engineer Sabota is going to talk us through those.

Last but not least, one minor change to note, again, per direction from City Council, the Lakeshore Park Pathway Lighting Project, we advanced that a couple of years. That was the only significant change among the two projects. And that concludes my presentations.

I'm going to go ahead and open up the public hearing on this item. Is there anybody in the audience who would like to speak to this item? I'll close the public hearing and come back to council for comments or a motion.

I'd like to move staff's recommendation to include these projects in the CIP.

I'll second that.

We have a motion and a second and before I take the vote, I want to commend staff for moving up the timeline on this. I also want to commend staff because we have heard forever the need for restroom facilities out at the Lakeshore Park and we recognize that this is kind of an interim solution and depending upon the level of activity, It could result in a more permanent restroom facility out at that location. So I appreciate city staff and this council listening to the community and recognizing this is a priority and delivering on it. So let's vote. That passes unanimously. Council Member Contoncio had to recuse herself. Council Member Emery Little is absent this evening, so it passes 3-0. Thank you. There was discussion, Mr. Mnune, to sell your property, but I held firm. Ladies and gentlemen, we're gonna go to other business. And these are some new items that we've not seen before, so it'll be interesting for the council discussion on these items. F1 is to conduct a study session to receive information and provide feedback on a development concept proposal for 5311 Central Avenue. Mr. Mnune?

Yes, good evening, your honor, members of the council. As your mayor so indicated, this is a relatively new process for us to wade through, so I'm going to take a moment to explain the process and how we got here. Robson Homes approached city staff to seek preliminary feedback on proposing a project to redevelop an approximate four-acre site on Central Avenue. The site currently houses Holbert Lumber. The site is zoned limited industrial and has a general plan designation of limited industrial. modifying the zoning and general plan or legislative acts and completely discretionary by the council. The focus tonight is to receive preliminary feedback from the council on whether the zoning and general plan should be modified to allow residential development on this site. To be clear, no application has been received by the city. As such, no formal reports or studies have been prepared. Should the developer turn this concept into a project, It would go through the typical entitlement process, and that includes community meetings, environmental review, and appropriate studies would have to be performed. This would take approximately 18 to 24 months. The council will not be asked to take any action this evening. This is a study session. It's an opportunity to provide preliminary feedback on a development concept before an application is submitted. The presentations are intended to be brief and provide high level summaries. Before I pass it over to staff, I'd like to highlight that there are some due process considerations at play. The city council should not make any definitive statements regarding the proposal itself or state whether the city council would support or not support the proposal. Instead, staff will receive feedback from the council regarding the concepts presented and then work with the applicant on their proposal should they wish to proceed with a formal entitlement application. With that in mind, I'll pass it over to Senior Planner Carmelissa Lopez. Ms. Lopez.

Thank you, City Manager. Good evening, Mayor, Vice Mayor, and City Council members. My name is Carmelissa Lopez, Senior Planner with the Community Development Department. The item before you this evening, as City Manager has stated, is a development concept study session for a development concept proposal located at 5311 Central Avenue. I would also like to note that the next agenda item is another study session for a separate proposal. Both study sessions will have the same format, but with different proposals. So for the study sessions, they do provide city council with an opportunity to receive information, ask questions, and discuss the topic at a public meeting setting. No action will be taken by the council this evening. And as this is the first development concept study session, staff's presentation will include some guidance as to the feedback that would be helpful to the applicant. This is the agenda for tonight's presentation. We'll begin by introducing the city team and the applicant. Next, I'll provide some general information about the project site and proposal, including applicable general plan and zoning considerations, as well as any potential legislative actions. The applicant will then provide a more detailed presentation. And following that, I will conclude with staff's recommendations and outline the next steps for the study session. For the city team, I have myself, Community Development Director Steven Turner, Deputy Community Development Director Art Interiano, and representing the applicant, we have Mark Robeson with Robeson Homes LLC. The council members may be familiar with Robeson Homes. They do have a development currently under construction at Cedar Boulevard and Smith Avenue. So for what is a development concept study session, it is a new process that provides applicants with an opportunity to receive preliminary City Council feedback. Developers frequently contact our department seeking early input on their proposals. These proposals are typically high level in nature and may include conceptual site plans and other preliminary info intended to assist with project planning. In some cases, proposals may involve potential general plan amendments, rezoning requests, or other land use considerations that would benefit from early feedback. Because these legislative actions are not undertaken frequently and may involve broader policy considerations, the early feedback is helpful, and it allows applicants to evaluate whether and how to proceed with a formal entitlement application. The purpose of these study sessions is to provide the City Council with opportunity to discuss the concepts, provide high-level feedback, especially regarding policy considerations, potential entitlement pathways, and other aspects of a proposal that may benefit from further refinement. It is important to note that this study session is not a public hearing, and it does not constitute a project approval, so there's no formal action that will be taken. And this slide summarizes the very high level on the study session process. It begins with the developer submitting an application to the Planning and Housing Division. Staff will then conduct a preliminary review to identify the applicable general plan and zoning designations as well as any potential discretionary actions. After that, there's no further analysis of consistency that is conducted. Following staff's review, a study session is scheduled with the City Council. And during the study session, staff provides an overview of the proposal, such as I am doing at this current moment, and then the presentation will be provided by the applicant of what they intend to do. The City Council will then be able to ask questions and provide conceptual feedback. And then following the study session, the applicant may decide whether and how to proceed. Should the applicant choose to move forward, staff will work with them to identify the appropriate next steps in the review process. As for the proposal for this study session, the applicant is proposing a 36 unit residential development located at 5311 Central Avenue. It is located at the intersection of Central Avenue and Cedar Boulevard. The property is designated as limited industrial in the general plan and zoned limited industrial. The site is currently occupied by Holbert Lumber Company, which is a building material sales use. It is adjacent to industrial uses, commercial uses, and residential neighborhoods. The proposal would have a density of approximately 10 units per acre, which is generally consistent with the city's low density residential designation. Because residential uses are not currently permitted on this site, a general plan amendment and a rezoning would be required. Additionally, other anticipated entitlements would include a design review, as well as a tentative track map if the units would be for sale. To satisfy the city's inclusionary housing requirement, the applicant is proposing to provide affordable housing offsite. So with our most recently adopted inclusionary ordinance, that would be considered an alternative means of compliance, which would require city council approval. As discussed earlier, amendments to the general plan and the zoning code are not made frequently, so it should be carefully considered, and if the project does move forward. And that concludes this portion of the presentation. I will now turn it over to the applicant, Mark Robeson with Robeson Homes.

Good evening.

Good evening, Mayor Hannon, members of the City Council. I want to thank—my name is Mark Ropeson. I'm the president and owner of Ropes and Homes. I want to thank the council for allowing us to bring this item before you this evening and thank city staff for the efforts that they put into the presentation tonight. I'm not sure how to operate this, but— Okay, yes, these are photographs of prior projects that we've done, and we're a family-owned business. None of the photographs include the project that we have up the street. The project's still under construction, not complete yet. Please go to the next slide. I don't know how to do that. Thank you. It's not? Okay, thank you. It's the discussion tonight is the reason why we're here is to focus on what happened to that. Let me hit this. There it is. It's to focus on land use and converting the property from industrial use to residential use. The site is, I think, a transitional location. You've got low density across the street or lower density across the street at six to the acre and down the street where the timber project is, one of our projects, and another townhouse project are being built at densities closer to 20 units to the acre. And what we're proposing here, as staff said, is 36 units to the acre and a product that is different than what is currently being offered and I think will fit in nicely in this location. And it's... Go to the next slide. This is a preliminary site plan. These are traditional homes that we're planning and what the concept is is to build something that's two and a half stories that is more compatible with the homes across the street and it's a different type of housing than what's currently being offered. These would be on 3,000 square foot lots. The homes would back up to both Cedar and Central Avenue. They would have the front doors would be on the on the interior street side with the garage, and they would all include small backyards, which is very desirable. In the next slide, It shows you that the house on the corner is similar in scale, but not the same as what we want to do. It gives you some feel for it. You can see on the roof line that there would be the half story is we tuck a loft under the roof line above the second story. But the first floor and the second floor are traditional ground floor living and your bedrooms and your family areas on the second floor. And there's a loft on the third floor. And these homes would be about 2,600 square feet. Sorry, I'll just pass through. The slide I missed, I don't know how to go back, but it's a Spanish-style, nice detailing, I think would be a nice addition to the streetscape out on Cedar and Central Avenue. There it is. Thank you, whoever's doing that. Thank you, city manager. Thank you. assistant city manager and and so you can see the the detailing and I think it would be an attractive addition and improvement to what's on the property now from an aesthetic standpoint And these are images of what is in the neighborhood now. It's a lumber yard. And I think by code, I think your code identifies it, the lumber yards as blight. And so what we're planning would be an improvement to this. And these are images, I know you all know the area very well, but gives you... A couple of things I want to point out, though. This property is surrounded by streets, which is extremely unique. And one of the things that I want to point out in the next slide is that It creates some kind of interesting constraints, you know, trying to, you know, how do you front the existing streets? What's the best way to do that? There are some, there's an active gas line along Timber, and there's an abandoned gas line in the same street that, and trying to weave your, your utilities through those is a challenge and expensive. But one of the other things I want to point out about this property that is unique is that although it's only 3.9 acres, there's almost 2,000 square feet, lineal feet of frontage. As comparison to the seven acre site that has a lot of frontage down the street that we're currently building on There's about 1,200 lineal feet of improvement of improved frontage So you've got extremely high amount of improvements that will go into developing this property And so it does make it, you know, it is a considerable constraint you know given the the size versus the amount of improvements along the frontages that will need to be made Next slide is, you know, is along Cedar and gives you some idea of what we're thinking about relative to what the frontage would look like. It would be similar to the neighborhood across the street. There'd be a parkway, a sidewalk, a wall, and then the homes would back up to Cedar. And same along Central, very similar. as as as the as you go down cedar and the key the competent road project on the other side of cedar has the same you know there's a sidewalk a wall in the back and the homes back up to the uh you know to the to that street you get some flavor for the how the interface of these homes is adjacent that we're thinking about is would be along that street and uh and the scale so it's really different than what is down sear that we're currently building in terms of scale of the homes. This is a long timber. It's the other frontage. It's the third frontage that we would be, you know, fronting homes onto. In this concept, it does show the site plan that we're showing. Assumes the front doors would be out to timber. I don't know that we're actually going to wind up doing that just because of development constraints that the homes we may wind up citing these. These homes to that to that fridge, I kind of went through it quickly, but there's a, you know, there's a, there's a gas line monitoring. equipment along this frontage that you don't want in your front yard. So we're thinking that we would either back up to this frontage or side onto it. And the yellow pipeline there shows you where the gas line is relative to these homes. And it's the same gas line that runs through the other properties down Cedar 1 that we're currently building and then the ones that are the other that's being started and the timber project that was built several years ago. So in terms of inclusionary housing, the proposal that we're making would be offsite BMRs, and we would have the same number of BMR homes. It would allow us to deliver those homes faster than we could if we built them. They would be deed restricted like any other home that we would have. that you would have in a BMR situation. And we'd be purchasing off-site townhomes or condominiums to make that conversion. And they would be homes within Newark and with all the same resale controls that you typically have on a BMR. So in conclusion, the benefits that we see that this project could bring is it would beautify the city corridors, cleaning up the existing condition. It does provide a different type of housing. There have been a lot of town homes that have been built in Newark in the last few years, and this is a different type of housing. It would be... I think it'd be super compatible with the homes across the street and it transitions nicely within the neighborhood. It does provide below market rate units and a type of housing that homeowners are looking for. It's a more traditional home on a 3,000 square foot lot that from a pricing standpoint fits in nicely given the price point of the townhomes and the single-family homes across Cedar. And that concludes my presentation.

Thank you, Mr. Robeson, for your presentation. Now we'll move on to staff's recommendation. So to assist with the discussion portion of the study session, staff would like to provide some guidance to the council regarding the type of feedback that could be helpful to the applicant. Staff recommends that the city council focus on identifying aspects of the proposal that appear appropriate for this location and consistent with the city's goals, as well as any aspects that may warrant further consideration. Key aspects could include the proposed general plan and zoning amendments. As I mentioned earlier, it would require some of those legislative actions. Other key aspects include site design and layout, as well as residential characteristics, which can include the proposed density, housing type, unit size, and potentially the target population. And as a reminder, again, the study session is intended to obtain conceptual feedback to ensure that the applicant receives due process on their potential formal entitlement application. Staff is seeking that there are no definitive statements regarding the proposal itself and what the council would or would not do to support or would not support related to the entirety of the proposal. So we just ask for the high level conceptual feedback. And as for the next steps, now we'll go on to the discussion portion of the study session where council can ask clarifying questions to both staff and the applicant and then also provide conceptual feedback. No formal action will be taken. And after the study session concludes, the feedback will be provided back to the applicant and we'll discuss next steps from there. Thank you. I'LL ALSO PUT THE KEY ASPECTS AND THE STAFF RECOMMENDED GUIDANCE AS THE SLIDE FOR THE DISCUSSION.

THANK YOU FOR THE REPORT. COLLEAGUES, QUESTIONS? COUNCILMAN GUNDAL.

YES. A COUPLE QUESTIONS I THINK FOR STAFF FIRST. It's my understanding that we're in the process, or we will soon be in the process, of updating our in-lieu fee for housing. I assume that that would be, that update, because I think when we last discussed this, it was understood that our existing fee is, at least in my opinion, THE PROCESS OF UPDATING THE FEE BE COMPLETED BEFORE THE PROCESS OF UPDATING THE FEE BE COMPLETED BEFORE THE PROJECT WERE BROUGHT FORWARD?

Thank you for the question. Steven Turner, Community Development Director. The City is going through an impact fee study to assess the current fees and how the fees could change based upon more current conditions. That study is ongoing. The applicant is not provided, has not submitted an application, so they're not locked into a particular fee at this point. I think the impact fee study is looking to be completed a little bit later on this year. WE'LL HAVE TO SEE EXACTLY WHAT FEES WOULD APPLY WHEN THE APPLICANT SUBMITS THE APPLICATION.

THANK YOU. WHAT IS ENVISIONED IN THE OTHER PROPERTIES, THE OTHER COMMERCIAL INDUSTRIAL PROPERTIES, LET'S CALL THEM LIGHT INDUSTRIAL PROPERTIES THAT ARE BETWEEN THIS SITE AND 880? THIS MAY BE THE APPLICANT OR MAYBE YOU, STEVEN.

YES. CAN WE PULL UP THAT SITE PLAN? to show that?

If you don't mind me adding to your question. Also, if you can clarify going the other direction between the end of the project site and the railroad tracks.

Sure. Let's see if there's a... Yes, thank you. At this point, the property owner and the project proponent is, of course, focusing on the Holbert Lumber site. From time to time, we do get inquiries about a similar type of conversion for the light industrial to the, I guess, to the north or the top immediately adjacent to that. We've just had initial discussions and answered questions from property owners and developers that are interested in that site. But there's been no coordinated plan for developing both sites together that the city has seen. Of course, if we can coordinate a much larger set of parcels together, we think we could DO A BETTER SITE PLAN AND HAVE EFFICIENCIES AND BRING EFFICIENCIES AND BRING DIFFERENT HOUSING TYPES TO THAT DIFFERENT HOUSING TYPES TO THAT LARGER SITE. LARGER SITE. HOWEVER THERE'S NO COORDINATED HOWEVER THERE'S NO COORDINATED EFFORT TO BRING BOTH SITES EFFORT TO BRING BOTH SITES TOGETHER AS ONE PROJECT.

TOGETHER AS ONE PROJECT. OF COURSE. OF COURSE. TO COUNCILMEMBER GRANDAL'S TO COUNCILMEMBER GRANDAL'S QUESTION THE PARCEL AS YOU QUESTION THE PARCEL AS YOU DESCRIBED JUST NORTH THAT DESCRIBED JUST NORTH THAT INDUSTRIAL IS THAT THE SAME INDUSTRIAL IS THAT THE SAME OWNERSHIP OR DIFFERENT

it's typical when you're looking at zoning in general plan to not stick to a particular parcel and a particular owner so as part of that planning process if this were to move forward staff would look at even if the property wasn't being proposed for development at this point, the staff would probably look at, I think that you'd be looking at what the appropriate zoning would be on that property and then the existing use become a non-conforming use. Is that an accurate description of the process?

We might look at that as a study. However, we would really take that direction from city council. City council, of course, adopted the general plan and the zoning. Ideally, zone changes, general plan changes don't happen often. The city has light industrial areas throughout the community. However, removing more light industrial uses could be seen as removing a type of business type that the community values and appreciates. So we want to be very careful whenever we talk to developers about changes of land use, particularly because The City Council has set that vision through the general plan. So we wouldn't be necessarily looking at this in a comprehensive way with both projects unless directed to by the City Council.

Okay, yeah, it just seems to sort of stand out by itself. I'd be concerned about the urban design elements of doing this piece by piece. Yep, that's a very helpful comment. And it's my understanding that the area to the south OF CENTRAL IS ALREADY A HOUSING OF CENTRAL IS ALREADY A HOUSING ELEMENT SITE. ELEMENT SITE. IS THAT YOUR RECOLLECTION? IS THAT YOUR RECOLLECTION?

WHICH SITE IS THAT?

WHICH SITE IS THAT? ACROSS CENTRAL, WHAT IS NOW, ACROSS CENTRAL, WHAT IS NOW, THERE ACTUALLY IS AN AUTO CENTER THERE ACTUALLY IS AN AUTO CENTER AND A DESIGN CENTER. AND A DESIGN CENTER. I WISH I COULD POINT TO IT. So on the right side on this map, because we're not, the North Arrow isn't quite right, so no, further down. THERE YOU GO. THIS WHOLE AREA, THE VACANT PROPERTY THAT YOU'RE LOOKING AT IS NOW A SENIOR HOUSING PROJECT, CORRECT? CORRECT. AND THE AREA TO THE BOTTOM OF THAT, LOWER DOWN THAT AREA IS A HOUSING ELEMENT. I'LL HAVE TO TAKE A LOOK AT THAT.

I WILL HAVE TO CHECK THE MAPS TO CONFIRM.

I see that. So, um, the, the frontage on central and cedar that was indicated by the developer, um, we have certain standards in terms of trees and, um, landscaping and, um, and back a wall that creates a pleasant look, it's your understanding that those standards would be met in what he's proposing? I know you've just seen roughly.

We haven't assessed the project for conformance with those standards, however we would expect to apply those standards to this project.

So one would expect trees and an attractive look, like we have down Cherry, we have down other major intersections. Yes. Fantastic. So I want to talk about inclusionary housing a little bit. And this may be a question for the developer, but what exactly would it mean to buy and make affordable another product? And also... WOULD THERE BE ANY CONCERN WITH CLOSELY TYING THE PROPOSED PROJECT TO ACTUALLY DELIVERING THOSE UNITS AS AFFORDABLE? I DON'T LIKE IT WHEN THERE'S A BIG TIME GAP BETWEEN WHEN THE MARKET RATE GETS BUILT BEFORE THE AFFORDABLE COMES ALONG. Could you describe a little more of what you're doing with that and also just your sense of the timing of both elements of the project?

Sure. And one of the points in the presentation that I made is that because when you buy a residence, you save all the time in construction. This would allow us to deliver an affordable home much earlier in the process. And there's plenty of ways the project could be conditioned so that those homes are... You know, are delivered at, you know, honestly, whatever stage you guys wanted to. We'd need to go buy those and put a deed restriction on them and convert those. So it's, I think it's a much easier way to do that. We did that and have done that on past projects in other municipalities.

Thank you. JUST TO BE CLEAR, THIS MEANS WE WOULDN'T ACTUALLY BE ADDING UNITS TO OUR COMMUNITY. YOU WOULD BE DEED RESTRICTING AN EXISTING UNIT THAT WAS PROBABLY ALREADY OCCUPIED.

YES, YOU WOULD. THAT IS CORRECT. BUT YOU WOULD BE BUILDING 36 NEW HOMES POTENTIALLY. GOOD.

THANK YOU. I APPRECIATE THE ANSWERS. I MIGHT HAVE FURTHER QUESTIONS AS THE DISCUSSION DEVELOPS.

Yes, thank you. Thank you, Your Honor. I was thinking about in the top left corner on the corner of Timber Street, is that a pocket park that was being proposed or is that just greenery? What is that?

It is, you're required when you develop to, you know, that you can't discharge water into the bay without treating it first. So it would be biotreatment that's required for the project. But, and I don't have a, thank you very much. I really appreciate it. But I didn't bring any photographs, but those are typically areas that we can beautify with landscaping that does well in wet conditions. And if you'd like, I can forward some pictures of what those areas can look like. It actually would be a landscape feature when we're finished with it. But its point would be to do two things. It'd be attractive, but also it would treat stormwater.

Okay, I understand. I was just thinking though, because we have about 36 houses, assuming that there would be children or students here, is there an idea of a small park or something like that for this community?

There isn't. We do have backyards and those are very desirable, but the backyards would be small. The lots are... based on this concept 42 feet wide and there'd be the yard would be in the in the wider portion would be 15 feet wide so it'd be you know for outdoor dining lounging barbecue pets but not really for play not these yards wouldn't service that but you know the project down the street you have a deck and you don't have a yard so they would not we are not planning a pocket park in this project

Okay.

At this point.

Okay. Perhaps it could be further discussion in the future. We don't know.

Of course.

I did also have a curiosity regarding parking. I mean, I realize these are single-family homes. I'm assuming it's a two-car garage, but is there going to be visitor parking?

There would be visitor parking. And then we also did restrict all of our... when we when we write ccnrs because these would be private streets we have a requirement that people park in their garages and we typically or we always stay on our homeowner boards you know for the first several years so that you know we can make the transition and one of the things we make sure of is that people are parking in their garages and using their gar their their garages for for cars and not and not stuff, and we sit on the board with the other board members and make sure that that happens. And at the point of sale, we require our buyers to sign an acknowledgment that they plan to, and it requires them to park in their garages, usually a chartreuse or a big, long, pink piece of paper so they can't miss it, that, hey, you really are supposed to park in your garage, and it has worked out really well for us.

All right, thank you.

You're welcome. Vice Mayor Jorgensen. Hey, just a couple questions for you while you're up here. Looking at the projects I hear, it looks like the driveways are open onto Timber Road. I think, especially if Timber Road, you know, on the, I guess, eastern end of that, if that light industrial area does get developed, you know, I would worry about approving a project that has, you know, is in walled on all four sides. I think that makes it hard for the people who live there to feel like they're a part of the community. So I think as it is right now, where it is open onto timber. Right now it wouldn't make sense to open it up to Cedar or Central. So I think keeping it open up to timber, where it is, this potential new community can feel like it's a part of the broader community. I think that is important. I'm so happy to see that. Just a question about the off-site. You mentioned you've done that in other municipalities. I do worry about that becoming a speed bump a little bit for the project so talk about your experience a little bit in those other communities where you know you've accomplished this you know was it the speed that you thought it was going to be talking about timing of entitlement talking about the timing of getting the off-site um deed restricted homes no purchase converted it's pretty straightforward that's a not a complicated process and we uh we did that in fremont

Oh my gosh, probably back in 2012 or so, and we bought several homes and it turned out to be a terrific process. We worked with the housing department at the city and the city typically controls all that, but it was pretty straightforward. We would buy the homes and the city, like you typically do, provides, finds the customers

Well, I'm glad to hear that you have experience in doing that. You know, with our, you know, inclusionary housing, you know, ordinance, it is something that we do want to see, you know, within the community. But, you know, there are exceptions to that. So, you know, if that's a route that we choose to go as a council, you know, I'm glad that is something you have experience with and that has been successful in the past. All right.

Thank you.

And then just a question for staff on that, the off-site portion. Yeah. Obviously, there would be a Newark requirement. Would we be able to put some kind of mileage requirement that has to be a certain distance from the project site? I would not want to say, do this a couple times, and then all of our off-site units end up in one neighborhood. So would we be able to put in place something to say, it needs to be within a certain distance of the project site? I think we can be very generous with that. Curious about that.

Yes, we don't have standards like that currently. It's interesting to think about having the off-site affordable component within a certain proximity of the project site. I think one of the things that we would look at is the opportunity to get as many affordable units as possible. And perhaps that's more bang for your buck perhaps in other areas of the city. So wouldn't want to necessarily limit it artificially if we can get more units.

And that would be my primary goal, too. It would just be I wouldn't want to, you know, the next time a project comes before us and then we make that same calculation of, well, we can get a little bit more bang for our buck in this neighborhood by doing this. Then we do it a third time. Then we do it a fourth time. And now all of a sudden we've kind of, you know, we've worked against ourselves, the spirit of our inclusionary ordinance. And we have these, you know, market rate developments. Then we have the affordable development. IT'S A VERY INTERESTING WAY TO APPROACH THAT. APPROACH THAT. I THINK STAFF CAN CERTAINLY LOOK I THINK STAFF CAN CERTAINLY LOOK INTO THAT FOR SURE. INTO THAT FOR SURE. I WAS GLAD TO SEE SIDEWALKS I WAS GLAD TO SEE SIDEWALKS ON THE OTHER SIDE OF THE ON THE OTHER SIDE OF Cedar Boulevard does have sidewalks. I'm glad to see that that's going to continue through to Timber Road. I would also, if possible, I don't know the dimensions of the road, would like to see us continue the bike lane that is on the other side of Central Avenue as well on Cedar, continue that bike lane up through Timber and see maybe spot by spot if we can connect it in with the bicycle infrastructure further down on Cedar.

COUNCILMEMBER GUNDAL.

I WANTED TO MAKE ONE POINT IN LIGHT OF COUNCILMEMBER CONTANZO'S COMMENT ABOUT A TOT LOT. IN THE GLASS BAY PROJECT THEY ACTUALLY TURNED THAT, WAS ABLE TO TURN MOST OF THAT bioretention area into an underground system and then pumped it pumped it on so they were able to they were able to substantially increase the amount of area available for a tot lot so back of envelope that may be something here where you could create a tot lot and so if you so staff should sort of take a look at what was done there as a way of making that park more usable and you know, a relatively small lawn area that was bioretention. So just wanted to, because I just wanted to bring that forward. Hadn't thought of that until I heard Council Member Cantincio's question. That's all I have, Mayor.

Thank you. Before I make my comments, Mr. Robson, I want to make sure I thank you for the outstanding projects that you have brought to the city of Newark. When I look at the different projects around our community and I look at the quality of housing that's been provided, you certainly are at the top of that threshold in terms of not just providing housing, but really quality housing. So I want to make sure you are thanked for that. I appreciate your efforts throughout our community. I'll be honest with you, I'm not a big fan of the alternative method for providing affordable housing. I don't want to see a hodgepodge of this housing throughout the community. I would much prefer that the... housing impact fee be paid to the city, which then gives us, Mr. Mnuna, an opportunity to cobble those monies together to really look at an affordable project that makes sense in our community rather than simply buy homes throughout the community and convert those into affordable units. I would prefer and ask the applicant to consider paying the housing impact fee instead of the alternative that's been suggested. That would be one of my suggestions moving forward. Did I hear you, Mr. Representative, indicate that the housing that's facing onto Central, those would be back facing to Central Avenue?

Yes.

That's contrary to your development down the street, isn't it? Down the street, do they face Central?

They face Cedar, yes. Or Cedar, I mean. But that's an alley-loaded product where the front door is opposite the garage side, and the front door and the garage would be on the same side, and it would create an opportunity for a backyard, which the other product doesn't have. Let me bring this up really quick. And this is in scale similar. And this, for example, is an example of an alley-loaded product where the front door is on one side and the garage is on the other. But this home does not have a backyard. And so by doing what we're doing, we're able to get a backyard because you can't back out to Cedar or Central because those streets are just too busy.

Thank you. The number of units that are being proposed, and I'm not sure if this is a city staff question or not, there's such a critical need for housing in the Bay Area. Can I get staff's thoughts on increasing the density that would allow for more units to be built on this property? Have you given that some thought?

Thank you, Mayor. Thank you for the question. As Mark Robson knows, staff is looking for greater opportunities for housing for a wide variety of households at a wide variety of income units. Staff is currently looking into investigating our missing middle housing type, particularly to provide housing types that are perhaps on the smaller end of size, which could therefore be more affordable to a larger variety of homeowners and households. As you might recall, the City Council approved a program for a first-time homebuyer program where we're setting aside monies for households to assist with that down payment assistance. One of the challenges is that we don't have a lot of homes that are affordable where the down payment isn't so large that they can afford that or even that our down payment assistance would make a dent in that. If you have a more affordable or a lower cost market rate home, the dollars that are spent through the first time home buyer program can make a lot of sense. So I think this overall, the city needs to have a mix of housing and the missing middle housing type is something that we are trying to promote. We would like to see more density on the site if we can. We think that provides some benefits for more households within the community.

Great. Yes, Vice Mayor. Yeah, just on that. You know, I think as we look, at least from my perspective when we're looking at trying to find You know, variety of housing types. I think that more dense unit that we're seeing, we're going to run into challenges finding good spaces for it. And, you know, backing up to two major streets within Newark is going to be a good spot for this. We're not going to have to worry about it, you know, towering, you know, if it's a little bit taller. over somebody's existing backyard. I think with some of those, some of those more, you know, Newark's more traditional housing options, you know, your duplexes, your quadplexes, I think we can find opportunities for that in time in kind of infill spaces, kind of within our existing lower density residential. Whereas I would say that this isn't, from a location perspective, AN OPPORTUNITY THAT I THINK WE MIGHT REGRET IF WE DIDN'T GO A LITTLE BIT DENSER BECAUSE I THINK IT'S GOING TO BE HARD FOR US

Yes, first of all I want to indicate I agree with the Mayor that aiming towards an inclusionary fee with the caveat that the fee is properly updated because as it is now it's ridiculously low in comparison to what it actually cost to develop housing. So with that caveat I agree with the Mayor it may be a better fit here. IN ADDITION IN TERMS OF ADDING MORE DENSITY AND AFFORDABILITY IN TERMS OF ADDING MORE DENSITY AND AFFORDABILITY IF THEY WERE INCORPORATED INTO in-law units, what we call ADUs now, if they incorporated ADUs into these projects, not only does that relieve some of the financial costs for the home buyer who now can rent out the space and help with their mortgage, but it adds another unit and another type of sort of missing middle. So I would hope that that at least would be investigated as a part of this process.

I THINK THAT'S A GOOD COMMENT AS WELL. I'M SORRY, MR. TURNER, I THINK STAFF MENTIONED, WHAT'S THE LOT SIZE FOR THESE HOMES?

APPROXIMATELY 3,000 SQUARE FEET.

OKAY. SO I DO AGREE WITH COUNCILMEMBER GRINDALE AS WELL THAT IF THERE'S AN OPPORTUNITY If we're not going to increase the density for any reason, which I support, I agree we should have more of a mixture of housing at this location. And we certainly look to Mr. Robeson, who's been very creative when it comes to housing throughout our community, to see if there's more of a mix that would meet our needs in terms of creating affordability for our residents, that would be great. But secondarily to that, look at each one of these parcels and see if there's an opportunity to establish an ADU on each one of these parcels, which then in and of itself brings affordability to the project. Any other last comments? Yes, Council Member Cattaccio.

Thank you, Your Honor. I was just thinking as you were speaking regarding possibility of perhaps a junior ADUs. I think those are attached in the home, but allows an additional resident to be able to access things like a small kitchenette or something like that. So that could be a possibility. So we could have mixed use there within the home structure.

And Mr. Turner, I would imagine, or Mr. Benun, that would help us meet our RHNA numbers for this current cycle. The more affordable and the more units we build in our city, the more likely we're going to meet our RHNA numbers that are mandated, by the way, by the state.

That is correct. And we are able to count a portion of ADUs as part of that calculation as well.

Great. And so thank you, Ms. Lopez, for the report. I hope that the directions and the comments have been helpful. Council Member Grandal.

I'm sorry. I just wanted to clarify that when I was talking about ADUs, I was talking about junior ADUs. I should have been more clear. So Council Member Contaccio's point made that clear. I think that's what we're talking about is in building ADU. Thank you.

But I'm willing to give staff the opportunity to be flexible in that regard because I think the lot sizes are large enough that you can put a 400 square foot ADU in the backyard as well. So I give, again, this is simply comments to staff to provide to the developer. So we give latitude in that regard.

Great, thank you. Mayor, I do have an answer for Council Member Grindahl's question about the sites between Cedar and Timber. Those sites are housing element opportunity sites, and they are zoned medium density residential.

Okay.

Great quick work, thank you.

Thanks. This is not an action item by the Council, so thank you, Mr. Robson, for being here tonight. Ms. Lopez, thank you for the presentation. Mr. Robson, whatever project you bring forward, I think it'll be outstanding, so thank you. The next item, ladies and gentlemen, is another study session to receive information and provide feedback on a development concept proposal for 8,000 and 8100 Jarvis Avenue. Mr. Mnoon?

Yes, good evening, your honor, members of the council. As the mayor indicated, this is another work session to solicit feedback from the council on whether modifying the zoning and general plan designation to accommodate residential housing would be beneficial to our community. In this agenda item, we have a concept proposal to redevelop a six acre site into a housing development containing 74 for sale units and 85 affordable rental units. Similar to the previous item, no application has been received by the city. Should the developer wish to turn this concept into a project, it would go through the typical entitlement process, which again includes community meetings, environmental review, and appropriate studies would have to be performed. This would take approximately 18 to 24 months. A friendly reminder, again, that we do have some due process considerations at play. The council should not make any definitive statements regarding the proposal itself or state whether the council would support or not support the proposal. Instead, staff will solicit feedback from the Council regarding the concepts presented and work with the applicant on their proposal should they wish to proceed with a formal entitlement application. With that in mind, I'll pass it over again to Senior Planner, Ms. Carmelissa Lopez. Ms. Lopez?

Thank you, City Manager Mnuchin. I hope that the Council appreciated the discussion in the last study session. I hope to have the same breadth of discussion in the next. So for this study session, the same format, but it is a different proposal. The applicant is Jason Lobb with Lobb Ventures LLC. The applicant is proposing a 159-unit residential development located at 8100 Jarvis Avenue, which is near the intersection of Jarvis Avenue and Gateway Boulevard. The proposal would include 74 townhomes and an 85-unit affordable apartment building. The property is designated as special industrial in the general plan and zoned Business Technology Park. Some may be familiar with the site, of course. The site is developed with two commercial buildings. From what the applicant has informed staff, there appears to be some vacancy issues. The buildings are adjacent to the Alof by Marriott Hotel, the Pacific Research Center campus, as well as a residential neighborhood. The proposed density of the townhome, so what staff typically does is we separate the densities when evaluating the project. So for the townhouse development, that would be approximately 17 units per acre, which would be generally consistent with the medium density residential land use designation. And as for the apartment building, that would be approximately 96 units per acre, which is consistent with the residential high density designation. I did note in the staff report that density is higher than what is allowed in the residential high density zoning district. So some form of density bonus or similar incentive would be required for that proposed density. And because these residential uses are not currently permitted on this site, a general plan amendment and rezoning would be required. Additionally, similar to the other project, both a design review and a tentative track map would likely be required as well. As for the affordable housing component, the project would fulfill the city's inclusionary housing requirement with the proposal of the onsite affordable apartment units. So that concludes this portion of the presentation. So I'll now turn it over to the applicant, Jason Lopp. Thank you.

Thank you, good evening, Mayor Hannon, council members, staff. First, I'd like to thank staff for all of the hard work getting us to this point this evening. We're excited to be here to share our thoughts on our proposal. Okay. So as staff mentioned, we're here to talk about 8081 Jarvis Ave at the corner of Jarvis Ave and Coyote Drive on the western edge of the city. My name again is Jason Lobb with Lobb Ventures. I've been developing and delivering housing to the Bay Area and throughout California for over two decades. I'm here in an advisory capacity this evening to the ownership of the property, who is Buchanan Street Partners. And here this evening with me is Mark Otto, of Buchanan Street Partners who can answer any questions you may have about property ownership type issues. And also with us this evening is Jessica Musick of KTGY, the architect that has been working with us to develop the initial concept. Jessica will be presenting a little bit about the design this evening, and then of course here to answer any questions you may have. So why are we here this evening? As staff mentioned, the property has been struggling with vacancies at the site. Ever since COVID, the office market in the greater Bay Area, California and beyond, has really struggled to attract tenants. So you can see here, 8000 Jarvis Avenue is at 38% occupied. That's a traditional office building, and that occupancy rate has been on the decline. A few years back, Buchanan Street, seeing the challenges with the office market, made a significant capital investment on the 8100 Jarvis Avenue property to convert it to a life sciences use. They injected significant capital, tried to attract a life science tenant, and despite all those efforts, haven't been successful. The greater Bay Area has struggled with life sciences with that use in the past several years. We've gone from sub-5% vacancy to over 25% in the past two years. So it's been really tough. So we're here this evening to talk about two commercial buildings with near zero occupancy, produces no housing, very little jobs, and a declining tax base, and what we can do with that site. So what we are proposing for the site Our 159 housing units, as staff mentioned, 74 of those would be market rate for sale townhomes. Those townhome units, Mr. Turner mentioned the missing middle earlier. We agree and these townhome units kind of fill that gap between a single family home that requires large down payment and hefty mortgage payments with interest rates higher than they have been, and rental housing. That's a missing middle product type. And then the other housing that we're proposing is our 85 affordable units. And the affordability levels we haven't honed in on yet. We would talk with the affordable housing developers and work with staff, but I think we could probably address a few of the different affordability buckets. At this time, I'm gonna invite Jessica to talk a little bit about the design.

Good evening council members and mayor and vice mayor. My name is Jessica Musick and I'm with the KTGY group. We are architects and planners with office here in the Bay Area and also across the country. We have the unique privilege of working with a lot of the nation's top home builders as well as a majority of my time is actually focused working with apartment developers. and some of those in the nonprofit and for-profit space. So the site plan that you're seeing on the screen is very early in the process. A couple of things that I do want to point out, everything in the light yellow is that three-story townhome typology that Jason described. What you're seeing are just the first floor of those units, and so they are all two-car parking townhomes. There's some space at the ground floor for bedroom or home office. There's an entryway and space for bathroom. Most of the living space for those units will be up on the second floor and then with bedrooms at the third level. Again, each of those has a two-car garage and then there's also some surface parking for guests provided at about 0.5 spaces per unit. The layout of those townhomes is really trying to do a couple of things. We're trying to front existing streets, so Coyote and Jarvis. Across Coyote is an existing single family development. And so it's a bit of a kind of transition of scale. And then internal to the project, you'll see different internal drives called Entry Drive, Lane C, we are trying to put front doors on those areas as well. The orange and gray footprint that you see fronting onto Jarvis is actually the affordable housing project that Jason described. So this is the 85 apartment, future apartment buildings. Parking for those units will be at the ground floor in a structured parking garage. And then fronting Jarvis will be basically the amenities and a leasing office for that building. We are utilizing two existing curb cuts on the project. And so there is an existing curb cut on Coyote that will really primarily serve the townhomes. And then we are going to be leveraging the shared access drive just to the, I'll call it the west side, the apartment building it's the top of the page and then you'll be able to come into the parking garage for that building in that location. Most of the townhome units will have private open space associated with them in the form of decks or patios and then the apartment buildings will have a shared courtyard that will occur at level two of that project. I'll try and advance the slide. So this is just some conceptual imagery. It's not meant to represent really the architecture, but it's more meant to represent the scale and the building heights that we're proposing. So the image in the upper left top is actually an affordable housing project that our firm did in the city of Alameda. That project is called the Starling. It is with Eden Housing, and that is an example of the scale of affordable project that we would be providing. So that project is actually at four stories. What we are proposing is five, but very similar with how it would work with a front door, again, facing Jarvis and then residential units above. The three story images that you're seeing on the remainder of this slide are examples of townhome projects that our firm has designed in and around the Bay Area. A lot of those examples are actually in the city of Fremont, so a neighboring city. And some things to point out, just how the individual units are expressed. a combination of both flat and pitched roofs. These slides start to give a little bit of a sense of scale of the space between buildings and some of the functions that we can plan for and activities we can plan for within the landscape and throughout the community. With that, let me go ahead and hand it back to Jason.

Thank you, Jessica. So I wanted to run through a few of the community benefits that we see for this project. First is a fiscal benefit, adding 159 occupied residential units to the property tax base. With the vacancies of the current office buildings, we see that tax base dropping down. And we don't know when that may come back. So another community benefit, housing production. Obviously, we have a statewide and, some may argue, countrywide housing shortage. So delivering 159 new units, 85 deed-restricted affordable units. we see as a community benefit. RHNA compliance, I think, you know, supporting the city's RHNA needs and reducing exposure for noncompliance with the state, mitigating blight risk, you know, At the risk of sounding a little bit dramatic, this property is distressed at this point. And so that's why we're here and looking at a different path and breathing new life into this property. Design quality, KTGY is an award-winning firm. They do fantastic design. So we see that as them being able to bring a real community asset, especially to the neighbors across Coyote. And then a collaborative process. Mark and I, Jessica, we're all looking forward to being very collaborative, not only with you and staff, but also the community at large. So again, just to wrap up, we're proposing a very significant affordable percentage here. 53.5% of the total units are proposed as affordable units, 159 total units. I put the RHNA numbers up on this slide. Sorry to remind you. I hope there's a right staff can correct me if they're not right. But we think this project can make a significant dent in those numbers. And we would be really thrilled to bring this to the community. So we thank you for the opportunity this evening and are very much looking forward to hearing your thoughts. Thank you.

Yeah, I'm really excited to see a rental housing component here. I think that's a type of housing that we don't have enough of here in the city of Newark. So I think with any project where we're looking at this kind of density and scale, you know, it would be tough for me to support it without a rental housing component. So happy to see it here. I do wonder on the, if you can go back to the site map, if the rental housing component might feel a little more integrated with the community, if it was kind of on the, I guess, left-hand corner where the parking lot was kind of in the back rather than its On one side, you've got a major street. On the other side, you've got a big parking lot. Well, it's got the same community streets, which is really good. I wonder if it was kind of on the other end and the parking lot was kind of in its own back corner, if that housing might feel a bit more kind of included in that neighborhood.

So this is really prime R&D space in terms of the location. I understand you have vacancies now, but I'm concerned about, so if we don't put jobs here, where do we put them? So I'm a little, I have some concern. I wouldn't, again, we're not making decisions here, but in general, I'm concerned about vacancies losing what could be prime space and frankly if I believe another hotel would be allowed would be allowed in this existing zoning district too which would be which would be a great fit for what we hope to do in our community I did, but barring that, I am concerned that this, it is kind of tight and I don't see any real green space. And particularly with the large apartment units, you really have to have a dog park. I mean, otherwise the residents turn whatever areas that exist into dog parks. But there needs to be a place for kids and for people with pets to experience that. Just wanted to bring that forward. Yeah. Like I said, it does seem a bit tight, and I am concerned about the interaction. As Vice Mayor Jorgens indicated, the direct fronting on Jarvis does seem a little odd from an urban design perspective.

I WANT TO ADD A QUICK COMMENT I WANT TO ADD A QUICK COMMENT I BELIEVE THE ARCHITECT CAN I BELIEVE THE ARCHITECT CAN CONFIRM BUT IT'S A PODIUM STYLE CONFIRM BUT IT'S A PODIUM STYLE RIGHT SO HOW IT LOOKS LIKE A RIGHT SO HOW IT LOOKS LIKE A PARKING LOT THAT'S ESSENTIALLY THE PARKING LOT THAT'S ESSENTIALLY THE GROUND FLOOR THE UNITS WOULD GROUND FLOOR THE UNITS WOULD ACTUALLY BE STACKED ON TOP OF THE ACTUALLY BE STACKED ON TOP OF THE PARKING SO YOU WOULD HAVE THAT PARKING SO YOU WOULD HAVE THAT BUILDING MASS THAT KIND OF BUILDING MASS THAT KIND OF OCCUPIES THAT THAT CORNER I OCCUPIES THAT THAT CORNER I UNDERSTAND BUT IT IS THE LARGEST UNDER

Yes, I remember. So what's the relationship between the market rate townhomes and this project? It sounds like you'd be looking for or the housing developer would be looking for competing for tax credit financing districts and so on and so forth. So the concern is that these things become decoupled. The reason why the community, why I might support a project like this is because of the affordable housing, but not if it means we take, we're robbing Peter to pay Paul, we have other projects we're looking for funding for. So if you can sort of talk about how those are gonna be related.

Yeah, absolutely. Yes, the affordable component, we would be talking to all of the affordable housing developers, and most of them do use tax credits, as you mentioned. Some also use bond financing as a mechanism. But that capital stack is difficult to achieve. But the builder for the market rate and the affordable housing developer would be two separate entities. But I totally understand and I think I heard it on the last project too about the timing issue. So what we often do is there's often a condition that says that the market rate won't receive occupancy until the affordable housing is developed. and built and brought to market as well. So we're totally open and used to doing that. It is tricky kind of threading that needle with the tax credits and the timing very often, but we have a lot of relationships with the affordable housing groups and the market rate builders, all the public builders. And oftentimes there's kind of symbiotic relationships between the builder and the affordable housing developer that work together very closely. So that's what we would be bringing to this project.

Thank you, and that's heartening to know that you wouldn't be necessarily resistant to linking the occupancy of one to the delivery of the other.

Yeah, it's a very common concern, and we totally understand, so we're open to that.

I have some uncommon concerns, too, so I'm just kidding. That's all I have right now.

Thank you, Your Honor, and thank you for the presentation. I do understand the idea of the courtyard to be occupied regarding the affordable housing units. I am, though, still concerned of having potentially 159 families because then we would have technically maybe about double that amount or so for kids and something like 300 kids we have a small courtyard in one area i haven't seen as i mentioned previously with a different developer the idea yet of a pocket park or different parks or some place for these children that i'm assuming are going to be there where they're going to be able to play and i'm worried about them playing in the street that's not where i would love them to play And I'm seeing that you do have different complexes, like three plexes there. So I would hope that maybe in a future design that we could also consider the children that are going to be part of these families and to be part of the community. I do like how we have the building that's close to Jarvis. Jarvis does have our grocery stores, and I'm assuming that they'll also have more foot traffic with affordable housing unit. I'm assuming that's perhaps why to put that unit there as opposed to the town homes. But I'm not sure if that was the logical thinking of it or not. But that's just something that I was noticing. I did have a question regarding the HOAs, the homeowners associations, because I noticed that in other locations, not necessarily Newark, but some people have mentioned that their HOAs have gone up like astronomically and the affordability component seems to be lost as opposed to having a single family home. So I guess my question would be is this more of a co-op style where the people would be able to also control their HOAs or are they going to be paying it ongoingly to a company that could raise it at any time?

Yeah, good question. The HOA would be similar to the prior applicant, right, where the builder would create the HOA and then stay on board for some time. Many of the HOAs have members of the community that make up the board, but oftentimes a community of this size will use a third party board property management group to help them be compliant with laws and regulations and that sort of thing so that would be my guess here is that there would be a third party company that would administer it but that you know setting the budgets and reviewing the budgets would be driven by the hua members and the board members

Okay, thank you. And I think my last question would be for additional parking. I see the parking structure that's there at the bottom unit for affordable housing. I'm not quite sure if we look at the top if those are additional parking spaces that are being proposed or in front of the units in addition to whatever's gonna happen with the complex.

Yes. So the other parking that you see, and just to kind of touch on the pocket park and kind of a lack of greenery, you're right. This is not a landscaped plan. It's just kind of a very conceptual plan at this point. Totally agree that this is a community of size that it would... probably makes sense for some sort of pocket park or community amenity separate from the affordable housing building. So we can look at that as we go forward. What you're pointing out are additional parking spaces for guest parking for the townhomes. So that's, you know, we've got two parking spots for each townhome in the garages, but those are additional guest parking spaces that you're seeing.

Okay, I understand. Thank you.

You're welcome.

And then just to staff quickly, I know we've done a project in the past where there was an apartment building and then homes for sale that were a part of an HOA. If my memory serves correct, the people who are living in the below market rate apartment building would be able to take advantage of any community amenities from the HOA but would not be paying HOA fees. Is memory serving correctly there?

on the... Yes, thank you for the question. It depends on how it's structured, but when we are doing a community such as this, we would want to see shared amenities between the affordable and the market rate. It just doesn't make any sense to kind of wall off the...

I would wanna make sure that the folks living in the apartment building are able to access whatever HOA amenities are gonna exist there. And I would also be very concerned that any HOA fees would eliminate any benefits we're gaining from having these units below market rate if the HOA fees are at such a level to do that. So I would say as we go forward, if we go forward in working on this project, that kind of structure to make sure that we can preserve both of those things is going to be important to me.

So as we look at the 85 affordable units, is there an income qualification for those particular units? Are we looking at low income, very low income? What kind of income level are we looking at for folks to be able to access that apartment building?

That hasn't been decided yet. So that's in development, but that would be bringing forward with the formal project.

Thank you. To the developer, help me understand from a practical standpoint the cost differential between a five-story building and a six-story building. I'm a big advocate of on-site retail if we can afford to do that. What differentiates a five-story from a six-story in terms of THE COST TO THE DEVELOPER, THE RATE OF RETURN, BECAUSE IT SEEMS LIKE FIVE STORY SEEMS TO BE THE

Yeah, I mean, with each level you go higher, the structure gets taller. And because we're in a seismically active zone, the structural members need to get a little bit larger the taller you get. So there is some added cost. Five stories, there's not as much magic today as there was prior before code amendments. We want to stay in what's called type five construction. It's combustible wood frame construction. As soon as you get out of that into type one construction, that's when it really starts getting more expensive. But here we're proposing four levels of stick frame over one level of type one, which is non-combustible. So if we needed to go another story here, the code allows us to do so still in wood frame construction. So it's not, there's some incremental cost increase, but it's not super significant.

Great. And I certainly wouldn't be opposed to looking at more units, possibly. Again, we're looking at a housing crisis around the Bay Area. The more units and certainly more affordable units we can provide to our community, the better we are in not only meeting our arena numbers, but meeting kind of the aspirations of our residents who live in the community. I love the proximity near the Pacific Research Center. My hope is that a lot of the folks that are working there will either be homeowners or renters here, and their transportation is just walk across the street. Yeah. That's something I would like to see have happen. I do agree with my colleagues regarding the need for some type of recreational amenity on the site, just to let you know. But I also have some concerns because we have a fairly established neighborhood on the other side of Coyote, and these are all single-family homes, not townhouses. I would really want to make sure you do a lot of outreach to that community to make sure that they're not – They don't have significant concerns regarding this type of housing. Even though Kyoto is kind of a wide street, they don't have any significant concerns about that development. I do want to thank the property owner for all the work you've done in the past. I walk my dogs down this area. See, what you don't realize, if you walk down Fortin Avenue and you take that little vacant street that goes nowhere, you walk right into this area here. And I've walked down this area many, many times. And I want to thank you. I've seen that you've put substantial amount of monies into this property. to try to encourage folks to come in and rent the properties. So I've seen that effort. And you have quality buildings there. So it's certainly not a lack on your part. So thank you for your efforts there.

Any other comments or questions?

Staff, any thoughts or clarification we need to provide? Thank you for coming tonight, and we certainly wish you the best of luck. Oh, I'm sorry. I did have one more question. I apologize. The apartments, have we made a determination? One bedroom, two bedroom, three bedroom mixture? Have we had a conversation about that?

One, two, three. Thank you.

Your Honor, public comment?

Oh, I didn't think we took public comment on this item.

I believe we... I DON'T THINK WE DID. WE DIDN'T ON THE LAST ONE. YES, ON THE LAST ONE WE DID. ON THIS ONE WE DID NOT.

OKAY. PUBLIC COMMENT ON THIS ITEM? YES. YOU PROBABLY HAD COMMENTS ON THE LAST ONE. I APOLOGIZE. NO, I DIDN'T. OKAY. NO, IN FACT, WE GOT YOUR COMMENT. I APOLOGIZE FOR OVERLOOKING YOU, ERIC. NO, IT'S ALL RIGHT.

Full disclosure, I'm a resident right across the street from this. I would like you to ask staff to go back and look at some of the records about... At one time, Jarvis was the frontier of Newport. Nothing on it besides open space. And as it was developed, there were lots of restrictions put on the property, properties that were developed there. And I'd like you to go back and revisit some of those things. Those concerns are still there. Traffic is a big one. Coyote is not designed for a lot of traffic that little gate on the professional park that blocks traffic when weather was a result of the owners wanting to have no traffic coming in at 6 or business opening and business closing. So they put a little temporary gate there that won't be accessed during an emergency. And if you're having all those townhouses dump onto Coyote, that's going to kind of go back against that condition that was put in place many years ago. But just go back and look at some of the restrictions that were put on there a long time ago and remind yourselves why they were put there. And they're bringing up an interesting development there. The conditions haven't changed from what was put in place many years ago. It was open space converted into industrial or commercial. We still need to watch that. Just be mindful. I know you will be. Your staff is really good about that kind of stuff. Oh yeah. Cows and horses out there. We did.

if this does come to council, maybe in an executive summary, kind of touch on those points and maybe address those at that time.

Thank you.

Thank you.

Any other public comments on this item?

Okay. We're going to close the public item on that. And thank you again for coming in. We wish you the best of luck. We look forward to seeing this project down the road. Okay? Appreciate it. Thank you. Ladies and gentlemen, the next item on the agenda is the adopted resolution approving the 2026-2028 biannual budget. Mr. Mnune?

Yes, good evening, Your Honor, members of the Council. I am pleased to report that staff has prepared a final 2026 through 2028 biannual budget for Council adoption this evening. The budget attached to the staff report is a culmination of several internal staff meetings, City Council work sessions, and a considerable amount of work produced by our fabulous and award-winning finance team. I thank the Council for your fiscal leadership, and I would like to publicly acknowledge the many staff members who spent countless hours, both during and after work hours, to prepare this document, so thank you. We have a brief presentation from Finance Director Lee that summarizes the changes that have been made to the document since the last work session last month. Ms. Lee, you have the floor.

Mayor, city council members, I'm Kristen Lee, finance director. I'm also very pleased that tonight we will be presenting the final 2026-2028 biannual budget for city council consideration and adoption. Before I begin, I want to note that staff did provide a few updated pages for this item, and these updates are administrative. They do not create any new positions. There are no changes to the fiscal recommendations and no required additional appropriations. So the final budget provides the appropriation framework for the city operations and services over the next two fiscal year. It aligns available resources with City Council priorities while maintaining a focus on fiscal responsibility, transparency, and long-term financial planning. Tonight, staff recommends that the City Council adopt the 2026-2028 biennial budget by resolution as presented. And following adoption, staff will finalize the budget document, publish a searchable version on the City's website. And staff also plans to provide the City Council with a demonstration of the ClearGov transparency tool in fall. The final budget reflects several months of review, discussion, and refinement. Staff presented the city's budget process, economic trends, financial updates, five-year forecast, and departmental priorities on March 26. And on May 28, staff presented the draft 2026 biannual budget for, oh, apologies, 2026-2028 biannual budget for council feedback and public input. Tonight's staff is presenting the final biennial budget for council consideration and adoption. The final budget incorporates updated financial information, refined assumptions, and council feedback.

And thank you mayor and the city council members for your questions and feedback as well as direction.

Since the May 28th work session, staff has made several updates to move the document from a draft budget to an adoption ready budget for council consideration tonight. The transmittal language, budget highlights, and narratives were updated to reflect final budget assumptions, current projections, and appropriation amounts. The five-year forecast was also updated to reflect current actuals, revised revenue estimates, updated fund balance projections, and refined personnel as well as non-personal expenditure assumptions. Overall, the near-term forecast reflects stronger revenue projections across several general fund revenue sources. On this slide, staff is highlighting the operating results before transfers and because it provides a clearer view of the general fund's underlying operation position. The before transfer measure is important because it isolates the city's core operation performance. It shows whether ongoing general fund revenues are sufficient to support ongoing general fund expenditures. Transfers and designations remain important, but they do reflect separate funding decisions such as reserve strategies, capital funding, or other planned allocations. The general fund budget updates includes refined fiscal year 2026 projected expenditures of approximately 97.5 million, and this is reflecting updated year end estimates. The fiscal year 2026-27, The general fund is projected to have a positive operating result of approximately 1.76 million before transfers, and in fiscal year 2027-28, the operating result is projected to remain slightly positive at approximately 20,000 before transfers. This is an improvement from the May forecast, but continued monitoring remains important because operating pressure is still projected beyond the biennial budget period. Staff also refined the vacancy factor methodology. So rather than applying a uniform vacancy reduction across all departments, personal expenditures were refined to apply vacancy assumptions to only where vacancies are budgeted or reasonably anticipated. This improves the departmental budget accuracy and it avoids reducing budgets in departments where vacancies are not expected. The department budget tables were also updated to align with the final budget model and city council department budget was updated to include the proposed 7.5% compensation increase. As a result, the city council department budget was increased approximately 21,000 from the May version. So staff also added information on the Energy Conservation Assistance Act LED project to improve transparency around the project's financing cost and projected savings. This project will replace existing lighting with more efficient LED lighting to reduce electricity and utility costs. It is projected to generate more than 240,000 in annual energy savings compared with annual debt service of approximately 105,000, resulting in a net annual benefit of approximately 135,000. So this slide summarizes the key changes from the May draft budget to the June final version you see tonight. And because the biennial budget was prepared in ClearGov rather than a traditional Word document, there was not a standard red line format. To support transparency, staff did prepare a separate summary of budget changes attachment to the staff report. And that identifies the updates by budget section as well as with page numbers. Overall, the final updates reflect refined assumptions, improved fund balance projections, and incorporation of council feedback from May 28th. And this slide shows the updated five-year financial forecast. For the two-year budget period, the forecast shows near-term improvement with operating results before transfers and designations of approximately 1.76 million in fiscal year 2026-27 and 20,000 in fiscal year 2027-28. The biannual budget remains balanced, but the forecast does show operating deficits beginning in the out years. This reinforces the need to continue long-term financial planning, careful monitoring of ongoing costs as well as ongoing revenues. This slide focuses on projected unallocated fund balance after transfers and designations. And the amounts are improved from the May forecast, but again, the out-year forecast still shows pressure on available fund balance beginning after the biennial budget period. The adopted budget will be available through Cleargov as a searchable, accessible format on the city's website. Staff will continue to implement the Cleargov transparency platform to improve public access to budget information. This platform will also include the capital improvement project tracking, allowing users to monitor capital projects, funding sources, as well as project status. The capital improvement plan and any other appropriations outside of the operating budget are being addressed through separate council actions. So following council adoption, staff will finalize the adopted budget document and publish it on the city's website. Staff will also load the adopted appropriations into the city's financial system so that the budget is ready for our new fiscal year, which starts July 1st. In summary, the final budget incorporates council feedback, reflects the most current financial assumptions available, maintains core city services, supports council priorities, and strengthens the transparency for both council as well as the public. Tonight's staff recommends that the city council adopt the resolution approving the 2026-2028 biennial budget. And that concludes my presentation. I am happy to answer any questions.

Thank you for the report. Is there anybody in the audience that has questions, comments regarding the city's biannual budget? I'll come to my colleagues for questions, comments. Council Member Grendel.

First of all, incredible work, really appreciated. I particularly love the transparency that you've built into this for the community. Just very happy with the efforts you brought forward. So thank you and your entire award-winning team. I do have a question which I think is probably for the city manager. Since this item includes the city council pay increase that I don't support, can that be voted on separately in this situation?

Sure. The council is free to take any motion, of course, to review this item. Possible motions would be to include the budget as presented minus the budgetary authority for the pay increases, the approximate, was it $20,000? $21,000. $21,000. That could certainly be a motion. I'd also point out, though, that in order for the pay increase to take effect, the council would have to take action at a future council meeting. And we would schedule that for September. So at that September council meeting, there would be the necessary ordinance change to reflect the pay increases for council members to take effect the following January. So that would be a separate action item that we would bring before the council.

Right, but it wouldn't take effect until January in any case? Correct, that's correct. Pursuant to state law, that's correct.

So refresh my memory. Thank you for your question, Mr. Grendel, Council Member Grendel. I think Council Member Grendel has already weighed in on his opposition to the council increase. In fact, if I recall correctly, and I'll certainly look to staff to correct me if I'm wrong, I think he voted no on the council increase previously. So I think if I'm not mistaken, his viewpoint is well known on that point. Clarification on that?

We'd have to go back and take a look at the minutes to see what was captured. That's my recollection. There was some discussion, of course.

Yeah, I would just... I don't want to vote for a budget that includes the pay increase. So that's my sense. So...

We have two options, I would imagine, Mr. Mnuchin, correct me if I'm wrong, we can vote on this and Council Member Grindahl can vote no on the budget because it includes the council increase, or if I understand correctly, we can pull that item out separately, vote on the budget, and then have a separate vote on the council increase, is that what I'm hearing?

Let me ask Ms. Lee. Ms. Lee, would it be permissible or would it be editorially possible, I guess it would be editorial possible for the council to go ahead and make a motion to approve the budget as presented with the excise of the additional $20,000, $21,000 for council increased salary. And then we would go ahead and take that vote. Should the council decide to take that action tonight, we would go ahead and amend the budget accordingly. And that would be the final version that would be posted on the website. That's correct, Ms. Lee. Correct.

That is correct with the caveat. Are we voting for that in September or are we voting for that separately tonight?

This would be something that should the council decide to take action, that particular action, we would editorially amend the document and then post that document online if that's the council's direction this evening.

I generally don't think it's a good idea for us to vote on the budget line item by line item. I think that would create, put the council in a role that we're not really best suited for. So I'd be looking for a motion to accept the budget as staff recommended.

And unless there's further comments, Council Member Contaccio, I'm going to second that motion.

I don't have further comments regarding that specifically. I also do agree that we don't want to get into the slippery slope of line iteming each of the budgetary items. I do want to say thank you for the presentation and also for your ability to provide additional documentation for transparency. And I am ready to vote.

And I will also, Ms. Lee, if you go back to slide, I think it was slide 10. And what I'm seeing here is that we're actually ending the year with a surplus.

That is correct, Mayor.

Of $1.76 million. Am I reading that correctly?

That is correct.

Before the transfers.

Before the transfers, yes.

But that's actually an increase of where you had anticipated we would be previously.

That is. It is an improvement from our previous, our May version of the forecast.

As I said to Mr. Banoone, to your folks working on the CIP project, I recognize, as Mr. Gondal and others do, having worked in government, how difficult the task is to bring a budget forward to any council member. And when I'm hearing my colleagues around the Bay Area and the Alameda County talk about the struggles that they're going to be dealing with as a result of deficits, significant deficits, year in and year out, our finance department continues to come back with awards demonstrating fiscal scrutiny when it comes to how we allocate our revenues and how we expend our funds. And I think that's why we are entrusted by our residents year after year because we've demonstrated that fiscal responsibility. So to the finance team, outstanding work as always. Thank you, Mayor. MY GOAL IN 2930 IS TO SEE THOSE LITTLE REDS TURNED INTO OTHER COLORS. SO OTHER COMMENTS? COUNCILMAN GUNDAL?

JUST UNFORTUNATELY I'M NOT GOING TO BE ABLE TO SUPPORT THIS MOTION, NOT BECAUSE OF ANY COMMENTARY ON THE WORK THAT'S DONE, JUST THAT I HAVE OPPOSITION TO VOTING FOR A PAY INCREASE FOR THE CITY COUNCIL. THANK YOU.

And as we prepare the minutes for this, I want to make sure that we're clear that Council Member Grindahl was voting in favor of the budget. His only concern and apprehension was voting in support of the pay increases for the council. I want to make sure we separate that so that at the end of the day, our residents know that Council Member Grindahl supported the budget.

I think, just to clarify, I do support the budget, but I'm not voting for it.

No, I get that.

No, go ahead. I get that.

You're going to vote no. I get that. But I want to make sure that folks know that you supported the budget. And the only reason you're voting no is because of the council competition.

That's what I was hoping to make clear. So thank you, sir.

I just want to make sure it's reflected in the minutes.

Yep.

Other questions or comments? We have a motion from Vice Mayor Jorgens, a second by the mayor. Please vote. It was me. And that passes with three ayes, Council Member Grindle voting no, and Eve Marie Little, Council Member absent. Thank you for the presentation. Thank you. We'll see you soon. See, because the budget's not just to see you in two years. It's back to the drawing board tomorrow.

Tomorrow, yes. Tomorrow morning.

Ladies and gentlemen, we're going to take a five-minute break before we get into the business tax license. So it is 10.06. We're going to reconvene at 10.15. Potential placement of a proposed ballot measure updating the business tax license and receiving an overview of business stakeholder engagement and feedback regarding proposed ballot measure. Mr. Benun?

Yes, good evening your honor members of the council. This is a presentation from city staff to discuss a potential simplification and modernization of the city's existing business license tax. Before I begin, I'd like to acknowledge that we have TWO STAFF MEMBERS WHO ARE HERE WHO ARE MORE THAN COMPETENT TO ANSWER ANY QUESTIONS THAT THE COUNCIL MAY HAVE. THAT INCLUDES OUR FINANCE DIRECTOR, MS. KRISTEN LEE, AS WELL AS OUR DEPUTY FINANCE DIRECTOR, MS. GLORIA DEL ROSARIO. I ALSO NOTE THAT MR. ERIC MEYERS OF HDL, WHICH IS THE CITY'S TAX CONSULTANT, HE'S AVAILABLE ONLINE SHOULD WE GET INTO TECHNICAL QUESTIONS.

NEXT SLIDE.

LET'S SEE HOW WELL I CAN... AH, THERE WE GO. HERE IS AN OVERVIEW OF THE... OH, I CAN GO AHEAD AND DO IT. IT'S NO BIG DEAL. Here is an overview of the agenda for our presentation this evening. First, we will provide some background as to how we got here. Secondly, we will go over the current, the existing business license tax structure. Third, we'll go over the proposed revenue structure options. Fourth, we will discuss estimated business impacts. Fifth, we have one slide that compares the proposed ordinance with neighboring and peer jurisdictions. Sixth, we will give an overview of our business and community stakeholder outreach efforts. And to round out the presentation, we will go over next steps. Ultimately, staff's recommendation is for the council to receive the presentation and provide feedback to us and direct us as to whether or not we should proceed with the necessary resolution and related documents to place a measure before Newark voters this November that would give the opportunity for voters to decide whether or not to modernize and simplify the city's business license tax. And that discussion should of course occur at the conclusion of tonight's presentation. to provide some background as to how we got here. If the council may recall on April 9th of this year, The city's tax consultant, HDL, Mr. Eric Myers, presented the council with an overview of the existing tax structure as well as offering some options to modernize and simplify that tax structure. If the council may recall, we had some discussion about modifying the various categories and mechanisms in which we tax business activities occurring in the city to a variable gross receipts model. Following that, the city retained Godby Research, an independent public opinion polling company, to conduct such a survey for our Newark voters to assess whether or not there's voter feasibility for this proposed measure. The results of that survey were presented to the council at the city council meeting on May 28th. Mr. Godby provided data and information to indicate that there was support amongst Newark voters for such a measure. The gold dot there in the middle represents today. This is the presentation from staff that refines the proposed tax measure that staff is recommending, as well as provide an overview of the business impacts and that will be done later in the portion of this presentation by our Deputy Economic Development Director, Ms. Angela Sway. Should the Council desire to place this item for Newark voters to consider this November, we would come back with the necessary formal actions at a Council meeting in July, and then the voters would, of course, consider this item on November 3rd. THE EXISTING STRUCTURE, JUST WANT TO PROVIDE AN OVERVIEW OF WHAT THAT LOOKS LIKE AS WELL AS SUMMARIZE LIMITATIONS. SOME OF THESE LIMITATIONS WERE DISCUSSED AT THE APRIL 10TH CITY COUNCIL MEETING SO I WON'T GO INTO TOO MUCH DETAIL HERE THIS EVENING. BUT IF THE COUNCIL MAY RECALL THE EXISTING BLT WAS INITIALLY ADOPTED IN 1970. IT HAS RECEIVED SOME LIMITED STRUCTURAL UPDATES SINCE THEN BUT FOR THE MOST PART IT'S BEEN LARGELY UNTOUCHED. If the council may recall, we have approximately 3,100 approximate businesses who have filed for a business license tax, excuse me, a business license here in Newark. Collectively, those businesses report $5 billion in gross receipts. And currently, those businesses collectively remit the sum of $1.5 million to the city of Newark on an annual basis. The existing structure contains 30 legacy classification subcategories. We believe it's around 10 or 11 or 12, something like that, main categories. And the remaining balance are all those subcategories. As I will show in a moment, there are some significant limitations with respect to that ordinance. First is that the annual revenue has remained relatively flat. The next slide will highlight that. Secondly, there's multiple calculation methods that creates administrative complexity, which we will cover in subsequent slides. The third and fourth point, legacy classifications do not consistently align with modern business models or economic activity, and the current structure does not consistently align with business skill or activity. I just wanted to pause here for a moment and talk about the latter two. If the council may recall, back at that April 10th city council meeting, excuse me, Mr. Myers provided information to the council that certainly spoke to this. In his report, he indicated that currently the top 100 businesses generating 75% excuse me, the top 100 businesses here in Newark generate 75% of gross receipts, yet they contribute 47% of business license tax. And that speaks to the inequity in proportionality. Additionally, Mr. Myers indicated in the report, if the council may recall, that the proposed models that we looked at at the time changed the rate structure so that businesses with larger gross receipts contribute greater share of total business license tax revenue, while small businesses contribute a smaller share. And this would shift the distribution of tax responsibility within the business community and align contributions more closely with the scale of business activity while maintaining the city's overall revenue objectives. As you can see from this chart, the revenue that the city has received from business license tax has remained relatively flat the past six or seven years. IT HAS REMAINED BETWEEN 1.3 MILLION AND 1.5 MILLION ANNUALLY. FOR FISCAL YEAR 2026, AS YOU CAN SEE THERE, IT'S ESTIMATED TO GENERATE $1.49 MILLION IN REVENUE FOR THE CITY. I NEED NOT POINT OUT THAT THE EXISTING STRUCTURE, YOU KNOW, While it has its limitations in terms of being flatlined over these years, the city continues to see increase in expenditures. I also, as the council, of course, is aware, typical generating, typical revenue streams, such as property tax, sales tax, EUT, those increase year over year. The current structure, I just wanted to give a brief overview of what that looks like. On the left are the rate types. Those are the classifications I indicated earlier. There's 10 or so categories and then about 20 or so subcategories. We listed the number of businesses for each category and as well as the tax model for each category. As you can see, some categories are based on gross receipts and other categories use payroll, vehicle-based fees, project valuation, or other methods. And again, as I indicated earlier, this is administratively complex. And we have the question of why modernize the existing ordinance. As indicated on the screen, the recommended approach would simplify the current structure by consolidating classifications, improve consistency across business types, better align the structure with today's business environment, provide a higher threshold for smaller businesses, and support long-term general fund stability. In reviewing the, Reviewing the situation and making a determination as to what type of tax structure staff recommends, we did take a look at three options. We will go over each one briefly. The first one is what we have called the high revenue option. The second one is the option that is being recommended by city staff, and the third option is revenue neutral. The first option is essentially the starting point when HDL does their analysis in terms of what our potential tax ordinance updates look like on business license tax. Essentially it's what big cities take a look at that they have in place. The last city I believe that has a model that's similar to option one is the city of Sausalito. Option two is the balanced approach that takes into account all the trade-offs, including simplification, the impacts to our business community, balancing that with general fund impact and the need for long-term fiscal stability for the city. Option three is essentially staff. We took a look at the existing revenue we receive right now and tried to simplify it and streamline it into those categories. and that would not result in any additional revenue to the city. Actually, it would result in a slight increase of additional revenue to the city. I'm going to talk about each one in turn. The high revenue option, we have labeled it as option one. Again, it simplifies the existing tax structure so that business activity is categorized into seven categories plus the exempt. This is not being recommended by city staff. It would generate $7.5 million in additional revenue to the city. This option would generate more revenue but has a lower small business threshold. So instead of $100,000 in gross receipts for the $25 base flat rate, it would be up to businesses reporting gross receipts of $25,000. The table there on the right, that is all the various tax rates for the business activities there on the left. Another alternative that we evaluated is what we are calling option three, the revenue neutral option. Again, we took the existing businesses here in the city of Newark, categorized them into those seven classifications there on the left. We applied the base rate of $25 up to the gross receipts of $100,000. And those are the tax rates there on the right. This would increase revenue by approximately $29,000. It's as close as we could get in terms of calculating and coming up with some sort of tax structure without increasing significant revenue to the city. And that's how we got to the $29,000 increase. THIS SLIDE CAPTURES WHAT IS THE RECOMMENDED ORDINANCE FOR COUNCIL'S CONSIDERATION THIS EVENING. THIS IS WHAT WE CALL OPTION TWO. AS YOU CAN SEE, THE CLASSIFICATIONS ARE THERE ON THE LEFT. THE RECOMMENDED TAX RATES ARE THERE ON THE RIGHT. THIS WOULD KEEP THE BASE RATE OF $25 AS A FLAT ANNUAL RATE FOR BUSINESSES WITH UP TO $100,000 IN ANNUAL GROCERY SEATS. THE RECOMMENDED STRUCTURE MAKES SEVERAL KEY CHANGES. FIRST, IT CONSOLIDATES BUSINESS CLASSIFICATIONS INTO SEVEN CATEGORIES, AS I INDICATED EARLIER. SECONDLY, IT MOVES BUSINESS CLASSIFICATIONS TO A GROSS RECEIPTS-BASED STRUCTURE. THIRD, IT APPLIES RATES BASED ON BUSINESS CATEGORY AND ECONOMIC ACTIVITY. FOUR, IT ALSO INCREASES THE SMALL BUSINESS FLAT RATE THRESHOLD FROM $25,000 TO $100,000 AND PROVIDES A $25 ANNUAL BASE RATE FOR BUSINESSES WITH $100,000 OR LESS IN GROSS RECEIPTS. I WANT TO TAKE A MOMENT AND TALK ABOUT BUSINESSES THAT REPORT REVENUE, EXCUSE ME, GROSS RECEIPTS OF $100,000 OR LESS. THIS SLIDE IS INTENDED TO CAPTURE THE IMPACT OF THE AMENDED ORDINANCE ON THOSE BUSINESSES. So right currently we have out of the 3,100 or so business license issued here in the city of Newark, half of those are businesses reporting $100,000 or less in gross receipts. Collectively, they remit to the city of Newark $90,000 out of the $1.4 million that the city currently receives, $90,000 comes from one half of the businesses. Under the proposed ordinance that staff is recommending, under option two, that would be reduced to $39,000. This table compares the current structure with the three options that were evaluated. The current structure, as you can see, generates $1.47 million annually. Option one would generate a total of approximately $9 million. with about $7.5 million in additional annual revenue. Option two is the staff recommended structure. That would generate approximately $6.85 million in total, which would be about $5.4 million in additional annual revenue. Option three is the revenue neutral option, and that would generate approximately $29,000 in additional annual revenue. WANTED TO CAPTURE THE PERCENTAGE OF BUSINESS ACTIVITY AS IT RELATES TO THE TOTAL AMOUNT OF BUSINESS LICENSE TAX REVENUE THAT THE CITY CURRENTLY RECEIVES. PIE CHART THERE ON THE LEFT. AND THEN ON THE RIGHT WE HAVE THAT IF SHOULD OPTION TO BE APPROVED BY THE NEWARK CITY COUNCIL AND APPROVED, OF COURSE, BY NEWARK VOTERS. THAT IS WHAT IT WOULD LOOK LIKE BASED OFF THE INFORMATION DONE TO US AS OF THIS DAY. SO UNDER THE CURRENT STRUCTURE REVENUE IS MORE HEAVILY IN GENERAL RETAIL, THAT'S RIGHT THERE ON THE BOTTOM RIGHT, REFLECTING 27% OF OUR BUSINESS LICENSE TAX. THE SERVICE INDUSTRY IS IN THE TOP LEFT, 19%, CONTRACTOR TOP RIGHT AT 18%, AND PROFESSIONAL BOTTOM LEFT AT 14%. UNDER OPTION 2, THE ESTIMATED SHARE OF TOTAL REVENUE SHIFTS BASED OFF THE UPDATED RATE STRUCTURE IN BUSINESS CATEGORIES. SO YOU SEE PROFESSIONAL INCREASING DISTRIBUTION AND LOGISTICS, WHICH IS ESSENTIALLY WAREHOUSING, That increasing, service industry increasing as well, and general retail shrinking from 27% to 8%. We took a moment to put these numbers in a table so you can see in a different format. We did maintain the business count there as the second column, the percentage of their relative share of business license tax. The current share is the next line, or next column, excuse me. And to the right of that, we have option two, which again is the recommended ordinance from city staff. Again, as you can see, the contractor classification, that business activity would reflect 10% instead of 19 under the new ordinance as it relates to the existing ordinance. And the rest of the changes are listed right there. Noteworthy that general retail, instead of reflecting 27% of existing BLT, that would drop down to 8% of the BLT under the proposed ordinance. WE DID TAKE A MOMENT TO CALCULATE SOME ILLUSTRATIVE EXAMPLES. THESE ARE NOT ANY BUSINESSES IN PARTICULAR. WE WANTED TO COME UP WITH HYPOTHETICAL SCENARIOS SO THAT WE CAN GIVE A SENSE TO THE COUNCIL AND TO THE PUBLIC HOW BUSINESS ACTIVITIES WOULD BE TAXED UNDER THE NEW STRUCTURE AS OPPOSED TO THE OLD STRUCTURE. SO I'M JUST GOING TO GO LINE BY LINE. OUTSIDE SUBCONTRACTORS. SO IF YOU'RE A SUBCONTRACTOR IN THE CITY OF NEW YORK WORKING FOR A and report gross receipts of $12,000. The existing payment to the city is $96. That would be reduced to 25. Home-based retail, receipts of $25,000 instead of paying 39 would be reduced to 25. Small professional firms, so this would be, for example, a one-person law firm or a one-person tax preparation office, gross receipts of $100,000, currently pay 130. That would be reduced to 25. SHOE STORE, WE JUST PICKED A GENERAL RETAIL TYPE OF BUSINESS AND WE LANDED ON SHOE STORE. IF THEY HAVE GROCERY SEATS OF $200,000, THE EXISTING PAYMENT TO THE CITY IS 137. THAT WOULD BE REDUCED TO 68. SALON REPORTING GROCERY SEATS OF $450,000 CURRENTLY PAYS 300. That would be increased to $725,000. A professional firm with higher gross receipts than the one that was indicated earlier, this would be, for example, a law firm with multiple attorneys or a tax preparation service with five employees, something to that effect. If they have gross receipts of approximately $500,000, the existing fee is $650. Under the proposed ordinance, it would be $1,025,000. Restaurants, if a restaurant has $625,000 in gross receipts, they currently pay $431,000. They would see a reduction to $251,000. Apartment complexes, if an apartment complex has gross receipts of $2.5 million, they currently pay $1,186. That would be increased to $5,425. Product manufacturing business, so if there's a business in town that generates $15 million in gross receipts, for example, sheet metal, something to that effect, They currently pay $5,311. That would be increased to $6,730. Large service businesses. So this would be, for example, an auto repair shop, janitorial service. If they have gross receipts of $30 million, they currently remit to the city $5,311. that'd be increased to 59,825. Large scale distribution of logistics, these would be warehouses essentially, if they have gross receipts of $40 million instead of paying 2,800, it'd be $119,725. The changes in the tax rates and the amounts indicated here, they were modified to reflect that some of these business activities are already contributing to city's general fund revenue in the form of other payments such as sales tax. We took a moment to compare the existing tax structure and all as well as the proposed and recommended tax structure to neighboring and peer jurisdictions. We took those exact same categories of businesses and those exact examples and illustrative hypotheticals, placed them there on the left. listed again the gross receipts, the current rate, the new rate, and we also looked at other jurisdictions, Fremont, San Leandro, Union City, Hayward. Hayward City Council has placed a business license tax measure for a Hayward voters consideration this fall. Should that be enacted by Hayward voters, those rates are referenced there at the most right column. My understanding is that the City of San Leandro is also considering an update and simplification to their business license tax measure. The Council has not taken any action on it at this time, and so as a result, we did not create a column with their proposed BLT update. I'm going to leave that on the screen for a moment so the Council can take it in. and also get a sip of water. Fiscal impact and use of reserves. As I indicated earlier, the city currently receives approximately $1.5 million annually. The additional revenue would support general fund services and infrastructure. This would be a general fund revenue source, so it could be used for any legitimate government purpose. That would include streets, pothole repair, parks, public safety, emergency response, reserves. It would also contribute to the city's long-term financial resilience. I covered a considerable amount of information. That's the first part of the presentation. The second part of the presentation is an overview of our business engagement efforts with our business community. Ms. Angela Sway will provide that portion of the presentation. Before I pass it over to Ms. Sway, would the council like to entertain some questions at this time, or would the council like to defer them until after Ms. Sway's presentation? Ms. Sway, I turn it over to you.

Thank you for this opportunity to discuss our outreach efforts. So as mentioned, city staff proactively engaged with Newark businesses to discuss the proposed updates to the business license tax structure. Our outreach efforts included hosting in-person public meetings. And to date, we've held four convenings on four different days of the week at different times of the day to be as accessible as possible to business owners and their representatives to be able to stop by and ask questions. We had a very robust conversation with the Old Town Business Association earlier this week on Monday, and with participants voicing their support, especially since many would benefit from that $100,000 exemption. And then as you heard earlier from Newark Chamber Board President Debbie Montes, we engaged with the Chamber Board asking for their feedback on the proposed structure. Staff will host one more convening tomorrow morning from 9 to 10.30 at the Newark Library Community Room. Again, for the opportunity for businesses to stop by, ask questions, and to learn more about what's being proposed. Other ways in which we reached out to engage the business community included a feature article in the June edition of the Business Buzz newsletter that was sent out on June 12th. Staff canvassed shopping centers and other commercial areas throughout the city to distribute informational handouts in English, Spanish, Chinese and Vietnamese, which are known to be the top four languages of our business community members. And then also a dedicated webpage was created that includes all of the information that was distributed. And all businesses have been encouraged to provide feedback on or direct their questions to a dedicated email address, businesslicensetaxatnewarkca.gov. And at this time, no messages pertaining to the proposed ordinance has been received. Thank you, and I'm available to answer questions.

Just a couple comments for you. One, I did attend the Old Town Business Association meeting and this was supported by those folks because they did recognize there was significant reductions in their business tax license if their revenues were under $100,000. But we also got the support of the former council member, Susie Collazo. Susie Collazo, who's a big advocate of Shopping Newark and recognizes the value of the revenue that allows us to do many things across our community, was very supportive of the business tax license proposal. But I want to thank you for the outreach that you did. It's never comfortable going to any community to talk about possible increases in taxes, but you did that, and I appreciate those efforts. I was also pleased to hear the Chamber's overwhelming support. These are our business leaders around our community, so thank you for that. Any other questions on the outreach efforts? Okay, thank you.

That concludes staff's presentation. The recommendation tonight is to receive feedback from the council on whether we should proceed in putting together the necessary paperwork for a ballot measure for voter consideration this fall. If that were the council's direction, then that item would come to the council next month.

Before I turn to my colleagues, I just want to make sure I simplify this issue. You know, I love democracy. You know, at the end of the day, democracy is what it's about, where you give the voters an opportunity to weigh in on whether or not they want to support a tax measure. You know, we saw both sides of this equation a number of years ago when the utility tax went to the voters and the voters said, no, we don't want to tax ourselves. But then again we came back to the voters recently on both the development of the Civic Center project and we asked them to increase the sales tax to themselves by a half percent and they voted in favor overwhelmingly and then of course the TOT which doesn't impact residents directly was passed at 80%. So I'm a big believer in democracy. We do the best we can to get the information out to our community in terms of not only the services that we provide the quality of life that they've come accustomed to living and recreating in our community, those come at a cost. It's amazing to me that we have not significantly raised this tax since 1970. The taxes that really affect our residents most directly, the utility tax, where homeowners are specifically paying for that. Property taxes, but this is a business tax. So in most cases it's one that's not gonna directly impact most residents. They may see a modest increase as we heard from Mr. Lopez tonight in terms of increased cost of goods because undoubtedly these costs will be passed on to the consumer. But I think it's a tax that just gives us, again, greater leverage to be able to provide the services that our community has come to grow and expect. So those are my initial thoughts. I'll look for additional comments. Council Member Contaccio?

Thank you for the presentation. I did have a question regarding, I believe it was slide 18 of the large service business tax. I just wasn't sure with that change whether or not it would possibly discourage businesses from being here, but then I was also looking at number 19, slide 19, and it seems that it would be similar to what Union City has. And so just reconciling both of those numbers, it would actually make Union City still slightly more than doing business here. I'm just trying to figure out what the magic number would be, I suppose, to keep businesses here, but also have businesses contributing to the general fund. but thank you so much for providing this. And I also believe in democracy, so the idea is to present this.

Correct. And what would it be under the option number two? The $119,725 tax relative to a $40 million gross receipts.

That would be .002975.

.002975. Okay. I think that helps to kind of put it in context.

Yes, it does. Thank you.

You're welcome. Other questions, comments? Council Member Grindahl?

I'VE ALREADY EXPRESSED MY I'VE ALREADY EXPRESSED MY OPINION THAT INCREASING TAXES OPINION THAT INCREASING TAXES WILL HURT OUR BUSINESS WILL HURT OUR BUSINESS COMMUNITY AND REDUCE THE AMOUNT COMMUNITY AND REDUCE THE AMOUNT OF INVESTMENT AND MAKE IT HARDER TO OF INVESTMENT AND MAKE IT HARDER TO ATTRACT BUSINESSES AND REDUCE ATTRACT BUSINESSES AND REDUCE EMPLOYMENT GAINS. I DO STRONGLY SUPPORT THE SIMPLIFICATION PROCESS BUT I BELIEVE THAT WE SHOULD USE THE REVENUE NEUTRAL APPROACH AND I DO WANT TO COMPLIMENT STAFF ON THIS CAREFUL CONSIDERATION OF THESE ISSUES TO REALLY to make the rates and the structure as envisioned much more in line with what's sort of good for our community. So I do support the restructuring, but I'm not supportive of using that to increase revenue because it will hurt our business environment.

Vice Mayor Jorgens.

Yeah, thanks. I appreciate all the work from staff. I would like to see the recommendation of option two go forward. It's the option that You know, we've seen our chamber support that, you know, and we're thinking about making, you know, making sure we're protecting and growing the business environment in Newark. You know, I'm trusting that the chamber, you know, as an advocate there is going to be, you know, a strong voice and make sure we're continuing to do that. So I'm glad to see that this is the option that. you know, has been presented to them that they're in support of. I'll also say that, you know, it's good that these things go out to the voters, and at the end of the day, it's going to be Newark residents that decide, you know, what they want to see. It's not going to be us voting on this increase other than our capacity as, you know, one of the 50,000 Newark residents, you know, voting.

So... Mr. Mnuchin, we need four council members to vote yes at some point to move this to the voters.

Correct, Mayor.

So tonight, if we wanted to send this to the voters to make an informed decision as to whether or not they want to see the business tax, which hasn't been raised in 56 years, raised, we wouldn't be able to send this to the voters tonight because Council Member Grindahl has indicated his objection to raising the tax as proposed by staff. we would not be able to, because we're not going to go with a revenue neutral proposal because it doesn't put us in a better favorable financial situation. In essence, I think you indicated the differential between now and a revenue neutral is 10 or $20,000, it would make no sense to go to the voters at the cost to put this on the ballot and ask them to raise that revenue by that such small amount. We heard from Mr. Godby, who did a research and analysis with our voters, and if I recall correctly, it came in between 63 and 65% in that neighborhood that supported the business tax license increase. The cost to provide services, and again, I'm gonna express my disappointment, Council Member Grendel, the cost to provide services to our residents have not remained stagnant since 1970. We're competing with other municipalities to attract talented employees to this organization. We're trying to attract quality police officers to come to this organization, and we're paying a premium to get police officers here because we're not just hiring any person off the street to do police work. We're hiring the best to become police officers here in Newark, and that comes at a cost. We're seeing the cost for employees, the cost for pensions, the cost for parks, the cost for streets improvements. All these costs are going up. and you either define a revenue source to pay for these or you stop providing services to your community. We already heard from Ms. Lee that in 28, 29, I'm sorry, 29, 30, we're looking at a deficit because we're already anticipating that we have to go back to the voters on the utility tax. It's amazing to me. Our residents pay today more on the utility tax then businesses pay for their business tax by three times. We get three times the revenue on our utility tax than we do from our business tax. And the utility tax are people that live and work in our community. The business tax are folks that may come in, live in our community, they may not. It just amazes me that when it comes to a proposal that we are asking the voters to weigh in on, and at the end of the day, I respect democracy. November 3rd, the voters may say, you know what, no. and I would respect that decision and we would make adjustments accordingly to either figure out where we're gonna get that additional revenue or we'd start to cut back services in anticipation of not receiving what we thought would be anticipated revenue down the road. So those are my comments to Councilmember Gondola and I'll move on. I do have a couple questions regarding the presentation. I wanna thank Eric Myers for being here and for providing any input that he has. I wanna thank Debbie Montes for being here. I wanna thank Lupe Lopez for being here. and taking a different viewpoint. But it's nice to hear overwhelmingly that the Chamber has considered this and has supported it. My only question, Mr. Benune, on the actual taxes itself. Oh, by the way, our original discussion on freezing the $25 minimum, I think my initial request was to raise that threshold to $50,000. Staff came back and said, you know what, we can do better than that. We can raise it to $100,000. Half of our businesses in Newark, I think your slide reflected 1,500 plus businesses in Newark have gross receipts under $100,000. Those businesses are gonna save money. I was concerned about the tax on manufacturing businesses. I honestly felt it was too low. I'd actually like to see the tax on manufacturing businesses be increased over and above what's being proposed by staff. Can you give me some thoughts on the tax for manufacturing businesses and whether or not, assuming this comes back to the council in the future and gets its support, would there be a separate model that you would consider on manufacturing businesses in terms of raising that tax so that we receive additional revenue? If that's an opportunity, then I would ask that we maybe then look at conversely at property rental. And it's not that I'm trying to save the property rental owners, money but I know that that's gonna be passed through to tenants and we're looking at the possibility of a housing inspection program here in New York and I think with that may come housing impact or housing occupancy fee again which we passed on to the renters and most of the renters in our community unfortunately are lower income residents. So if there's an opportunity to weigh the property rental proposal lower and increase the manufacturing higher, I certainly wouldn't be opposed to that analysis being done if and when this comes back to council. Thoughts on that?

We'd be happy to do that analysis and make that a part of the July council meeting.

back in two weeks and have that discussion i don't want to overburden staff it would be a i think it would for my sake it would be good to have a conversation about those two items individually and then be able to come back on the 23rd and discuss the okay here's what we're looking at placing on the ballot yes or no

It would be a relatively straightforward staff report. It wouldn't be an exhaustive type of staff report, but it shouldn't be too hard to put together some numbers and have that for a council review in two weeks.

Yeah, I think we can do both. That would be my preference. Okay. So can I get a motion and a second on this item? I'm putting forth staff's recommendation. We need to take a formal, I want to take a formal vote because I already know it's not going to pass, but I want it to be on the record that Council Member Grindahl voted against passing the staff's recommendation as presented.

I'll move forward staff's recommendation as presented with the understanding that staff will come back and present a couple of options that we, the two options that we just discussed.

I would second that.

All right, please vote. And that fails on a three to one, because as mentioned, we need four council members to- My motion, to clarify my motion,

Oh, that's correct. Bring that forward back on July 23rd. Putting it on the order. That should just need to be a simple majority for that to come down to us. That's correct.

Correct. The super majority of four votes would need to be achieved at the July 23rd council meeting.

Okay. All right. Excellent. The last item on the agenda tonight, folks, is the, did I, I don't think I got public comment on that item.

I don't believe you did, Mayor. I do. I did, thank you.

Ladies and gentlemen, the last item is to adopt a resolution approving the amendments to the City Council of Newark salary schedule effective July 1, 2026. Mr. Copratello is gonna go ahead and make the presentation.

Thank you. Good evening, Mayor Hannon, members of the City Council. I'll be providing a brief presentation this evening. There is no PowerPoint accompanying this. This item is a proposal for the City Council to adopt a resolution to approve amendments to the salary schedule to take effect July 1st of 2026. This largely just reflects approvals that the Council has already provided as part of the labor negotiation process and as well as part of the approval of the compensation and benefit plans. that took effect on July 1st of 2025. As the council's aware, the city has three bargaining units named, NPA and MPMA, as well as the confidential group and the management, supervisory, and professional group. Those are nonrepresented groups. July 1st, 2025, the City Council approved a MOUs with the bargaining units and compensation and benefit plans that run for three years. And we are entering year two of those agreements. The proposed revisions to the salary schedule reflect what the council has already approved, and I'm going to highlight at a very high level what those include for this year. They are a 3.5% salary increase for all classifications as negotiated and previously adopted. They are a 1.5% salary increase for sworn employees in 2 of 6.8%. senior management analyst of 5.28%, senior IT analyst of 5.23%, principal civil engineer 5.06%, information technology analyst 4.8%, maintenance supervisor 4.21%, facility supervisor 4.21%, management analyst 1, 4.1%, city clerk 3.63%, and assistant engineer civil 3.43%. And so with that, I'm certainly glad to answer any questions, staff recommendations to adopt the resolution amending the salary schedule.

Thank you City Attorney. Are there any questions or comments from folks in the audience? I want to thank Mr. Bennu, and I would imagine the work relative to looking at salary adjustments across the board probably fell upon our HR department, if I would be correct, and that's important. You know, we're competing with other municipalities for this talent in this organization, and as much as folks love working for the City of Newark, which we all do, We still have families to support, bills to pay, and it's easy to be attracted to another community where they're providing a larger salary. And then, of course, regret it later on and want to come back to the city of Newark. That happens occasionally. So I want to thank HR for all the hard work you folks do in this regard. You know, we need to remain competitive when we seek the best and the brightest. That's what we need to do. Questions or comments from the colleagues? If I can get a motion.

I'm not sure. I did.

I asked for public comment. I'll move staff's recommendation.

I'll second.

Okay. Moved by Vice Mayor Jorgen, seconded by Council Member Cantancio. Please vote. And that passes unanimously with Council Member Little not being here this evening. Thank you for the presentation. And we are now at Mr. Benun. Any city manager updates?

This lineup includes Latin Remix, Cisco Kid, ZBOP, and Tortilla Soup. And Latin Remix is tomorrow. Number two, the deadline for our urban forest survey has been extended. We are creating an urban forest management plan to help better manage and grow the city's trees over the next 20 years, and we want to hear from you. Share your thoughts on trees, tree protection ordinances, and tree maintenance priorities in your neighborhood by taking the community survey. It's open now through June 30th. The link to the survey is listed on the screen and it's available in multiple languages. The third announcement is we're encouraging our public to celebrate the 4th of July this year safely. As the 4th of July approaches the city of Newark, we just want to remind everyone to celebrate safely and responsibly. Please use state fire marshal approved safe and sane fireworks. They're only permitted on June 30th through July 4th. Fireworks are not allowed outside of those dates. And all fireworks of any kind are prohibited in city parks at all times. And that includes July 4, which our parks will close at 7 PM that evening. Also, we have a zero tolerance for illegal fireworks. Police will be out in full force throughout that period. $1,000 social host fines will be issued to people each time for any unlawful ignition, use, discharge, or display of dangerous fireworks occurring either at their property or their gathering. Fourth announcement is that our Alameda County Fire Department is hosting their annual 4th of July Pancake Breakfast. Start your Independence Day with a fun and family-friendly community tradition. In addition to a delicious pancake breakfast, attendees can enjoy a lively morning filled with activities including appearances by the Classic Cruisers Car Club, fire department demonstrations, Newark community's emergency response team, and more. This festive event promises to be colorful, energetic, and enjoyable for all ages. All funds received from this pancake breakfast go to a local charity fund. The event is on Saturday, July 4th from 8 to 11 a.m. at Fire Station 27, which is the fire station located on Cherry Street. Our fifth announcement, oops, our fifth announcement this evening Yeah, I don't know if it's a battery issue.

If you wouldn't mind going to the next slide, please.

Typically, these things are user errors. Our fifth announcement, July CERT training. This is hands-only CPR and abdominal thrust maneuver. Public is invited to learn essential life-saving skills to use before emergency responders arrive. Receive hands-on instruction in hands-only CPR and abdominal thrust maneuver for choking emergencies. Watch live demonstrations and practice CPR techniques on training mannequins. Build the knowledge and confidence to respond during cardiac arrest and choking emergencies. This is on Wednesday, July 8th from 6.30 p.m. to 8 p.m. at the Newark Senior Center. Thank you. The sixth announcement, we have a public review open for a proposed Cherry Street housing development. This is what we were calling Harvest at Newark. We are seeking input from our community on a proposed 274-unit rental housing development located on Ohlone College Newark Center campus. As part of the environmental review process required by CEQA, the city has issued a notice of preparation for environmental impact report. The notice of preparation is available for public review through July 13th. Community members are encouraged to review the document and provide comments by 5 p.m. on July 13th. A virtual public meeting will be held on July 7th at 6.30 p.m. to gather input and more information can be found on the city's website listed right there on the screen. And last but not least, starting at the next council meeting, we will be hosting hybrid council meetings. This format will allow the public to attend in person or participate remotely. The first hybrid meeting will take place on July 9th. This change is in compliance with Senate Bill 707, which requires a two-way audiovisual platform for remote public participation. And more information can be found on the city's website about how to participate virtually. And last but not least, on behalf of all city staff, we like to celebrate the Fourth of July with our community and wish everybody a joyous Fourth of July Independence Day celebration. Thank you, Mayor.

Thank you, Mr. Mnoon. Your reports get longer and longer every month. Thank you for the report. Council comments? I'll start with Councillor Grendel.

Just happy Independence Day to everyone. Thanks.

Councillor Contoncio.

Yes, thank you, Your Honor. Tomorrow I'm going to be representing Newark at FBank, which is a Filipino bar association in Northern California, which is an attorney organization. Also, I totally agree regarding having a happy Independence Day on July 4th, but also make sure to buy the fireworks because that is a huge, that's one of our huge fundraisers for our community and our nonprofits. Additionally, on July 8th, I'm going to be a guest speaker for youth, representing Newark on a panel put together by our assembly member, Alex Lee. I'll also be walking with him during a parade on Independence Day as well. And remember to shop Newark.

Vice Mayor Jorgens. So we spent some time this evening talking about the importance of businesses in our community. So I thought it would be good to talk about one of the first businesses in Newark and talking, of course, about salt harvesting. So salt harvesting predates Newark as a town by centuries. The Ohlone people would have harvested salt out of the bay. But during the Gold Rush, entrepreneurs and Californians worked to create many additional evaporation ponds. And by the 1850s, you start to see salt being exported out of Newark. In the 1860s, the salt operations have been taken over by a man by the name of John Plummer. So Plummer's operations... really improved things. He built wooden plank floors on the bottom of his ponds, which increased the purity of the salt so it could be table-ready. Now, not table-ready by modern standards, but for the 1860s, it was pretty good. But at the time, a bag of salt left on the household shelf would be like concrete after a few weeks because they couldn't quite get all the water out of it at the operation. But he did have grinding machines that were powered by giant windmills and So it was something that was starting to put Newark on the map. And it gave him access to both local and statewide markets. So before the name Newark is even there, you start to see the businesses coming along. And I'm proud that Newark businesses have continued that legacy to continue to innovate, to continue to bring jobs, continue to bring money and a good reputation for our city.

Excellent, it's late. I'm gonna close by wishing my wife, Kathleen, a happy 48th wedding anniversary today. I asked her today as we were going out to dinner, the time just goes by so fast. You know, 48 years we've been married. And she actually told me, I think all 48 have been pleasant years. At least that's my recollection of that conversation. But I wish Kathleen a happy anniversary. And it's been a real partnership over these last 48 years. And I look forward to many, many more years with her. So with that comment being said, we are closed for tonight.