Airport Commission - Regular Meeting

Following the meeting. Campos? Present. Ortiz?

Present.

Vice Chair Foley? Here. Chair Cohen absent. You have a quorum.

Great, thank you. So we're not reviewing the work plan or consent calendar. We're gonna jump right into the reports, and the chair has kindly asked that we flip the order and that we move the bike plan 2025 to be the first presentation.

So moved. Second.

All in favor? Aye. Thank you. Motion carries to move, make that adjustment.

Afternoon, vice mayor and members committee. John Rissel, director of transportation. We are here to give you the presentation on the city's bike plan and trail network. With me is Jessica Zink, deputy director for Department of Transportation, Ramses Madhu, our division manager for transportation, and soon to join us will be Liz Sewell, parks manager with Parks Recreation Neighborhood Services. So I'm gonna turn it right over to Ramses, and we can get started.

Alright. Good afternoon committee. Ramses Madhu, division manager of planning policy and sustainability for DOT here. We've just texted Liz to note that our item just got pushed forward. So hopefully she's running over to the elevator and luckily my portion of the presentation is first. So hopefully that all works out. So let's get into it. So we're here to talk about both the implementation of the bike plan as well as what's going on with the trail network. This is our annual update. All right.

All right. So as you all know, we passed a new bike plan back in about 2020 called Bike Plan 2025, which really accelerated development and took on the new mode for the city in terms of what a bike plan can do. This is really looking at all ages and all abilities, making sure that we're making the bike system safe and accessible for everybody and really driving that mode shift goal that's embedded in our general plan. The new plan does look for a five fifty mile network that primarily consists of protected bikeways and bike boulevards. The types of infrastructure that we're really looking for in the implementation of the plan are these four here.

Really focusing on creating physical barriers where we can, particularly on larger streets with either higher volumes or faster speeds, whether that be with our first attempts with quick build, which has been a huge success in terms of getting a lot of infrastructure out there quickly. Thank you so much for all the support and getting that done, as well as some great new hardscapes. We're seeing more and more of that, and I'll talk about that a little bit later as we go forward. And then a lot of the bike boulevards and we're starting to implement that as well. And those are on the quieter streets where if we can calm traffic a little bit and give some specific pointers to drivers and bicyclists, we can create a better environment.

So what does our bike network look like today and some of the accomplishments from a very busy year in 2025? Our existing network is about four ninety one miles. And I just want to point out that this has all been done in the last roughly fifteen, eighteen years. This has been really an incredible piece of work by the city. Our new plan network, as we said, is five fifty miles.

Three fifty of those we are hoping to make into protected bikeways and about 100 bike boulevards. The rest is the traditional stripe on the side of the road. 2025 was another huge year for the bike program. We added about seven and a half miles of new bikeway. And importantly, that work of enhancing those bikeways that are currently not up to the plan's expectations are seeing that extra work, getting either those separations with pylons or through concrete and the like.

All right. So some of the notable achievements here is a lane reduction over on Alma Road. This is just going under 87 to the east there. We added six new miles of protected bikeway, like I said, including some of those upgrades. And here are

some of the examples there. Oakland Road being

a pretty interesting one. It's a huge stretch of roadway with a lot of cars and some pretty good speed, so getting that separation is pretty important. And we also succeeded after a few years of going back and forth with VTA and the bay wheel system run by Lyft to get a station at the BART stop there. That was a fun adventure and it's finally come to the right conclusion. Some of the projects that are ongoing right now are pretty exciting.

In particular, the downtown Better Bikeways implementation. You may see the teams are out there in between the big sporting events, making sure we're managing this construction properly. They're getting out there, pouring concrete, building out things like you can see both in the top two pictures there that are basically turning what we have, which has been paint and plastic into those concrete separators creating what we would really expect in a downtown. We're seeing some other great pieces

like

the River Oaks Protected Bikeway being built out and some new wayfinding there on Alma Ave. Yeah, those are there. Some really exciting future projects that are cooking right now and going to be implemented over the next couple of years is that full build out of the Better Bikeways phase two. So that's that downtown plan. We're finally going to be taking San Fernando from its patent plastic design into the concrete.

And I'll say this has been, to us and DOT this has really been kind of one of the bellwethers, was one of the ones where we really first got a lot of attention and money and effort and kind of reformatting how we work in DOT around this project. So it's really cool to see it come into the fruition around truly protected system. We've learned so much through that project and it's kind of helped us understand what else to do. Another really important one is Story Keys. This runs all the way from the 87 under crossing out to, is it Capital? I can't remember. Is it?

King.

King. Thank you. And then we're doing further planning effort on the eastern, more eastern part there. But this one, the construction is supposed to start in the next year on the first part, which is the actual Keys part up to first. And then the construction on the next part starts the following year.

Then, yeah, and then we have a huge Baywheels expansion. We've got some great grant money there expanding the system over to the East Side, bringing in a lot of our equity priority communities into the fold there. Got some great, not only expansion, but also price cost sharing to enable folks to use that system for a cheaper price point. And we have our normal pavement maintenance bikeways kind of that opportunistic use of our programs to get more going. We've got some planning grants that are helping us expand.

As I said, that East Story Road Complete Street. So that's expanding that Story Quays work further east. And then coming to council tomorrow, have the Guadalupe River Trail on street bike connections. That's looking at where flooding happens on Guadalupe River Trail and finding some ways around the places where we think we can take the first action to alleviate that. A lot of people use that as a commute route.

And so when it gets closed off, it's really disruptive to people's ability to get to work. And it's not only during rain, but it's actually after because it takes us a while to get teams out there to clean up when it gets flooded. And then we are looking at getting a new bike plan update. We're looking for money right now to fully fund that, but it's about time to look and see what we can do there. All right, another important topic is maintaining and keeping our bikeways clear and operational.

Every inch of street way is quite contested between the immense amounts of different uses of the street and various, one of the things that we've seen a lot is the interaction between a refuse collection and the bikeways. We've got a very good relationship with ESD around trying how to alleviate some of the problems here. We had a pilot program where we're getting reflective stickers on a lot of the dumpsters, as well as signs out on the residential bins that tell folks don't put these in the bike lanes, put them up against the curb where that's possible. You can see in the right hand picture, we've got a lot of problems with these dumpsters kind of flowing in and you can see it every time you go by 3rd Street right here, drives me nuts. But what we've done in the design of the Better Bikeways concrete plans that are going out there right now is build in places for those dumpsters to sit.

And we're going to be reevaluating after that project is done to see if we need to do more to keep them out because we spend a lot of money and time getting those things out there. And then the refuse spins just sit in the middle of there causing bikes to have to go out on the road anyways. All right. With perfect timing, here's Liz.

Hi, everyone. Thank you, Ramses. I'm Liz Sewell. I am the trail manager for the city of San Jose. And actually, Yi is in the stands. Yi Tong Zheng is our landscape designer for our trail systems. So this first slide is probably familiar to those of you who have been on the Transportation and Environment Committee or sorry, excuse me, Commission for a while. This is the overall network of trails in the city of San Jose. It shows about 100 miles of planned and completed trails. And we wanted to show you this because last year, two miles of trail were completed.

And that's a pretty big number, especially since it includes a couple of retaining walls, under crossing, and a bridge over the Coyote Creek Trail. So if you can go to the next Thank you. I'll remember to do that next time. So this next slide shows the ribbon cutting for those two miles of trail. It happened last year, and it included council member Duan and others from the Parks Department and our Public Works Department.

And it celebrated overall the new connections between Berryessa Bart and Watson Park, as well as between pretty close to the Vietnamese gardens, south of the Vietnamese Gardens at Phelan down to Tully. So separately from the capital department, our parks division has been doing really great work managing encampments and cleaning the trails overall. It has increased. So you can see the no encampment zone sign up in the upper right hand corner. We did a count in 2024 right before the no return zones were established along the Guadalupe.

And then we did some counts after, and we saw the trail use increase by two. So the trail usage numbers are about two times what they were prior to the encampment prior to all of that work being done on the Guadalupe River Trail. So I wanted to highlight some key trail projects on this slide. You can see the top photo shows what will be the 5 Wounds Trail. It's the old Union Pacific Railroad that's now owned by VTA.

It's undergoing master plan and environmental overview. Some environmental documents are being done. We're not sure if that's gonna be a master plan or excuse me, a Sequoia or an EIR or exactly how that will work out yet. Also, initial design of the Coyote Creek Trail between San Jose High School and Watson Park is being done. The

oh,

Thank you. The regulatory feasibility of the Lower Silver Creek Trail between Alum Rock and Mayfair is being completed. That might take a couple of years just because it's going through regulatory overview by the US Army Corps of Engineers. And then finally, design of the Guadalupe River Trail between Branham and Chinua with, which will extend the trail up from Lake Almaden. And then finally, we have begun comprehensive trail assessments, and we do them biannually.

So our last assessment was last year, and the next one will be in 2027. And it's across the entire network of trails, and we evaluate pavement and signage and fencing conditions. The repair are prioritized based on the frequency of trail use and the severity of deterioration. So recently, we've repaired the bike erosion along Los Gatos Creek Trail near Meridian and Lee. We have resurfaced segments of the Guadalupe River Trail within the downtown core, and we have ongoing work to repair the erosion along lower excuse me, the Silver Creek Valley Trail.

So with that, that completes my portion of the presentation, and I think we open for questions.

Thank you, Liz.

There goes again. Alright. Thank you. Thank you, vice mayor, for kicking us off. Glad to be able to join you. I don't know if we have any members of the public here, so let's come back to the committee and start with vice mayor Foley.

Thank you. Thank you for both presentations on the bike lanes and and the trails. I'm really excited to see all the protected bike lanes going in in and and the bike lanes in general going in. Several came were completed in District 9 and I'm I'm thrilled and I know residents say, well, yeah, but we don't ever see anybody riding the bikes, but they do now because they actually have a bike lane. So we've connected Meridian all the way up which is really wonderful.

But I did want to talk about the bike or the trail along the Guadalupe and the generosity of congressman Panetta who was able to get a million dollar earmark to build out that trail once the plan is in place. So we had a press conference with him last week and it's, very exciting that he was thinking about us and and got the money for us. So I just wanted to make that that public announcement, and thank you for all your work. It's really exciting since we have removed the unhoused along the Guadalupe in that area, and now they're in an emergency interim housing right next door. The trail in that area is just so beautiful and the neighbors remember why they bought or why they moved into that area.

So thank you for working on the trails, building it out, and I'm excited about what the future holds for that area. That's it for me. Thank you. Oh, I move approval of the report. Second.

Alright. Now we'll move on to council member Campos.

Thank you, chair, and thank you staff for this report today. Also really great work that I just want to commend because it is so critical as someone who is liaison to the Youth Commission and constantly hearing about the climate concerns that they have and the fact that our city is making real progress on creating opportunities for folks to get out of their cars and writing, you know, walking, biking, making our streets more safe for pedestrians and bicyclists. So I had just one question out of experience for something that happened in my district and wanting to hear how this might be incorporated into lessons learned for the future. We have the Silicon Valley Bike Boulevard, which is has recently seen some changes to incorporate the bike plan and trail network, and the changes were begun because of some construction in the industrial area. It's around the Basking Ridge neighborhood, so for folks who are unfamiliar with District 2, it is a residential neighborhood mostly single family homes.

About half of the students that go to the school live in the area, but about half of them are driving in using Silicon Valley Boulevard. And so the outreach that was done ahead of these changes did not incorporate the voices of the residents, and so once those changes and construction changes started happening sadly around the winter months when there was inclement weather, we heard a lot of concerns about why. Why this road? Why now? And so I'm just curious how that experience is being taken to heart by DOT in in how we can make sure that as these changes are coming into neighborhoods, especially neighborhoods that don't have a lot of roads in and out of their neighborhoods and seeing one lane removed from vehicle traffic to increase bike accessibility, how those concerns of safety are being heard and are being incorporated into not just the plans, but the the construction.

So

It's a a great point. Thank you for raising it. I think, one of the things we've talked about with our colleagues who help us with the development services before the outreach process begins about who the users are and who should be notified and how we should do that. So I think starting from that point, which at this point in this case of this project was many years ago, that's kind of a key lesson learned that if we had looked differently at than just the standard outreach process, we could have incorporated a different set of perspectives into the design of those facilities. So I think that's the kind of leading indicator there.

Although we are also working on how to, make sure that our communication during construction and that the coordination of the actual implementation is, much tighter so that people kind of can see those different facilities, more clearly, have better notification, and understand that the changes are coming, hopefully, with more input at the design point. So thank you for the comment and for helping us connect with the neighborhoods affected.

Yeah. And and I just wanna say thank you. I know DOT and many other departments were out there meeting with the residents in that inclement weather and and demonstrating that we are receptive and that we do truly care about their safety. So I appreciate the acknowledgement that sometimes the bare minimum isn't enough and that some we do have to sometimes look a little broader and making sure that we're capturing those voices. So still looking forward to the day that we can get a walk and roll or like a bike group of of kiddos going to the school so that we can demonstrate that we really do need these bike lanes in our communities and that people do want to ride them.

So thank you again for the great work.

Thank you. And now councilmember Tor Diaz.

Thank you, chair, and thank you staff for the update on all of this work. I'm excited to see the city continuing to invest in improving our bike lanes, I've been particularly excited to see all of the hardscape improvements going in downtown. You know, maybe just because I've been paying more attention, but I certainly feel like I see more people actually using the bike lanes downtown. You know, I walk past three different protected bike lanes on my way to and from work every day, and every day I see at least a dozen people out there. So it's good to see.

One challenge that I do see though, and it's, referenced in the report, is cars continuing to block the entrance, particularly to some of the new bike lanes, which now that there's hardscaping actually makes it a little bit more difficult than the old paint and bollards situations, and sometimes you can't even get into the bike lanes. So I think a good opportunity to continue to work with our state legislature to see if there are opportunities here. I know that there's a bill moving through the legislature now around automated vehicle enforcement and curb management using cameras to issue citations for things like illegal parking or blocking of bike lanes. I also encourage you all to continue to work with IGR to see if there's modifications to the bill that would give us a little bit more authority here or if this is something that the city might want to come out and take a position of support on. And the final thing I just wanted to note is that I'm starting to see even a little bit more positivity from places outside of downtown with some of our bike lanes.

I was at a neighborhood association meeting last night or sorry, last week, and there was a resident who prepared to speak. And he was very angry. And he was like, I want to talk about bike lanes. It was about the Alma Bike Lane, and it turned out that he was upset that it took as long as it did to get it constructed and that there still isn't green paint in a portion of it that he cares about. But he went on to just give a glowing review of how he didn't used to feel safe biking with his kids to the nearby Safeway, and now that's their primary way that they go from their home to get groceries every week. So I feel like the message is starting to get out there to folks. We're seeing more uptake, and people are actually appreciative of the city investing in road safety. So I just want to thank you all for the work that you're doing.

Thank you. And I want to thank you too for the work. A lot of proactive work that you're doing was as paving is getting done across our city, I see proactive bike lane improvements that are not things that we are discussing. So I know that your team is out and looking for opportunities to improve, and you can see, I think we can tell, certainly in the five years that that I've been doing this, I can tell the tremendous change in in the the infrastructure, and I'm really excited about it. You know, I talked to people.

I was talking to somebody in Sunnyvale about what we've doing in San Jose, and I'm I was excited to share some of these photos with them and say, look, this is really this is what's happening downtown. Our lanes really are protected. I'll just point out the one I repeat this frustration every time. When you look at the map that shows the bike bikeways, you see nice North South routes, but in the North, particularly in the north part of the city, go and probably all along East San Jose, it's really hard to get East west. Although the highways are natural barriers, and I know how hard it is, but it's something we continually should just keep elevated that it's something to address.

And I appreciate the the for those of us who bike on the Guadalupe Trail, we know what happens in the rainy season underneath the highways, and you can't go through. And when it happens, how long it is to get all the way around to get back to the trail if you can't go under. So I appreciate that work. While we're talking about that, I'll I'll just highlight the the trail that goes the Penitentiary Creek Trail that goes under 680 East of Jackson has a similar problem in the winter and often doesn't get attention to to dredge it back out and make it usable. So just another area I wanna call your attention to because a lot of people do use that trail and have trouble getting through.

But we have a motion and a second, so let's vote to accept the report. Thank you. Motion carries, five zero. Alright. Thanks. Now we're on to our next item, back to item one, our infrastructure report on the city fleet management program.

Good afternoon. Good afternoon. I am Matt Lesh. I'm the director of public works. And with me is, Walter Lynn, deputy public works director, and Dave Mesa, our fleet manager. We also have our analyst for fleet services, Rajvir Desanj, with us as well to help us with answer any questions. So I'll kick it over to Walter to talk to us about our fleet.

Thank you so much, Matt. And, chair Cohen, vice chair Foley, and members of the Transportation and Environment Committee. As Matt mentioned, I am Walter Lin. I am the deputy director of public works. I'm here with my colleague, David Mesa, who is our fleet manager, and we'll be sharing the presentation with you today.

Earlier this morning, the you had heard the deferred maintenance and infrastructure backlog report, and that's a great lead in into what we're gonna share with you today in regards to an analogy that Matt had mentioned where we need to take care of our assets, including our fleet inventory, which includes our rolling stock, our vehicles, and also our equipment, such as generators, trailers, and things that do not move. We'll be sharing with you today elements of what our current city inventory entails, what the current challenges are, and the future approach is in order for us to get the most efficient, most safe, and most compliant fleets, that we need to have. During this presentation, we'll be talking to you about the fleet services and inventory, regulations, and also the electrification of our fleets. And, Sherry Cohen, we did not forget what you had shared with us in October. We were looking at the procurement of particular fire vehicles and some of the inquiries that you had there.

We'll be addressing that during this presentation as well. The availability of the vehicles and also service of our existing vehicles, the challenges, and also the opportunities that we still feel are out there and available and our continued pursuit of those options. Just an overview of our fleet services. So when we're talking about acquisition and disposal, we need to remember that when we are procuring our fleets, it's not as simple as just going to a dealership, going to a lot. We see vehicles there.

Can we just buy them, build them up, and provide those keys to our operating departments? There is a lot that goes behind what is entailed in the procurement of a fleet, and David will go through that in just a moment here. But it involves more of that protocol process where there is a development of the specifications very similar to when you're buying a personal vehicle. There are various trims. There's various options.

We need to make sure that from a feasibility and a suitability standpoint, the vehicles and equipment that we're procuring meets the needs of the departments and their operations, and we are not we're not getting what we don't need. Otherwise, there could be change orders and much more time and money spent to actually build the vehicles that we need. We also have to follow the city's procurement process as well too. So again, just can't go in with a checkbook, a P Card. We need to follow-up the procurement process.

There's a specific bidding aspect, and there are sometimes where we could use leverage contracts as well for our procurements, which we are, pursuing those particular options. But there is a specific city, procurement protocol, that we have to administer as well. When it comes to disposal, those are either retirements where a vehicle has reached the, end of useful life, either based on wear and tear, age, mileage, deficiencies within the vehicle itself where it may be no longer safe to operate, where we have to retire or redline those vehicles just based on operator safety. Service and repairs, as the DMIB, mentioned earlier today, that is our bread and butter. So within any given fiscal year, we average about 20,000 work orders a year for all of our city fleet, which we are just under 3,100 units.

Of that though, we are still fairly backlogged in terms of what we need to do to get all of the corrective maintenance, preventative maintenance, And obviously, we will prioritize emergency maintenance. But we just don't have enough staff resources or budget to really get all of the maintenance needs as quickly as we'd like to and back into the hands of the department operators. Fuel and parts maintenance, parts management. We have several millions of dollars of fuel budgets, that we, procure and we we expend every year. It It is no secret that over the last three months, fuel has skyrocketed.

And at this point, when we're looking at unleaded and diesel and even renewable diesel that we use, the numbers are really astounding. They are more than double than what we're seeing just in January alone. So the fuel budget is absolutely going to be impacted. We've been in coordination with the budget office to really show what the trends that we're seeing and trying to best manage what we have and looking into the remainder of this fiscal year and into next fiscal year. Mobile services, we provide assistance on the field as well too, whether it's refueling fire vehicles when they are, administering fire protection services on the field or whether we are refueling generators on the field as well too.

We are in our shops, but also out in the city facilities and also assisting other mobile city operations that are out in the field. Rental vehicle coordination, that is a bigger part that's becoming a growing part of our program where, as much as we can do with our existing city inventory of the city owned vehicles, there's solar deficiency where we're not able to get, procurements in time buildup in time, where vehicles are needed in a more quicker fashion, the rental amount that we have per year is $3,000,000 annually. So it is a considerable amount, but that is a supplement to what we need for the the city owned vehicle inventory. Telematics, our fleet program embraces technology. This is an aspect where not only do we have GPS, but these types of software programs that we have within the vehicles allow us to get more of the vehicle diagnostics.

So we can tell when a vehicle is due for service. We can tell when a vehicle is idling. We can tell when the vehicle is outside of a geofence that we have built in particularly. And it helps us find, which is very unfortunate, stolen vehicles. We're able to quickly get that information to the police, and they have recovered some vehicles for us in the past, just based on the telematics we have.

Emergency operations, whether we are inside the EOC or providing support outside of the Our, fleet team is, there and always on a twenty four seven, three sixty five scenario. And electrification, this is the big one where, there are city policies as well as state requirements that we are, in need of compliancy. And I wanna make sure that we all understand as well to you that it's not just about the vehicles. The vehicles are the big portion of it, but the behind the scenes is that we do need, the electric vehicle charging stations, which are very expensive. And depending on the the types that we need, the infrastructure and the construction, as Matt mentioned during the DMIB report today, it is not an easy process.

Along with that, we wanna make sure that our facilities can actually have and provide, the necessary electrical service to those chargers. As we're getting bigger vehicles that require the fast charging level threes, some of our facilities can't quite accommodate those chargers at this point. So we do need an upgraded service from the electric utility. That is something that we, have been already coordinating, and, we'll get into it in a little bit, during this presentation. But it's really the three main phases.

It's the vehicles, the chargers, and the facilities where those chargers live, that we have to look at it from a global a global standpoint. So this is just a quick glimpse of what we have within our city's inventory. Again, we have just under 3,100 units. In the upper right hand corner, yes, we do tame dragons as well. That is Ganon Dragon from Happy Hollow Park and Zoo.

And on the bottom right corner, we have vehicles to put out those fires in case that dragon becomes untamed. We have everything, that you can imagine within a large city operation, and we're very proud to actually have these as city owned assets. And although we do need rentals to supplement, what we do need of of the overall inventory, having this equipment as city owned and city maintained is tremendously helpful. As a world class city that we wanna be, having this readily available for our operations, it is extremely critical. So there's a lot of numbers on this slide.

It is really just a summary of what we have within our current inventory. The three different sets of data here all still equal to the 3,089 assets. They are broken down by the vehicle type, which is light duty, medium duty, heavy duty and other equipments. The other equipment could be, again, generators, trailers, amusement park rides, even some of the off road and specialty equipment that we have at the regional wastewater facility, in particular, the dredges and that type of specialty equipment. The second column or the second chart indicates the public safety versus nonpublic safety.

Public safety is 38% of our vehicle, inventory. And then the last set of data is the fuel based. So it's, unleaded, the alternative fuels, and then the nonfueled equipment. Within the alternative fueled vehicles, we have 53% of our city inventory that is alternative based, which is great. But as you'll notice, the all electric, though, is just under 13%, and that's that's the category that we will be increasing over time, in particular as we have to meet the California Air Resources Board requirements as well, which we have a lot of upcoming deadlines. With that, I'm gonna transition this to David, and he will go over some of the regulatory requirements and some of the availability and electrification, processes.

Thanks, Walter. Dave Mesa, fleet manager, Department of Public Works. Going over this next slide with regulations and electrification, you're going to see that we're talking a couple of different things here, starting with the city's vehicle policy for procurement. So we have what is a standard procurement, which we would go through every step of the process through the municipal code to procure a standard vehicle, whether it's a truck, fire truck, a boat, a dredge, all different types of our city fleet. As Walter highlighted previously, that's the standard method.

Or as of late, we've been able to leverage cooperative agreements to shorten procurement methods, to be able to get equipment and vehicles into the end user in a shorter, quicker fashion so that they can continue to do their job as quickly as possible for our community. Regarding regulations, so as many of you may have heard, over the last several years, California Air Resources Board, they enacted the, ACF, which is the Advanced Clean Feats, Fleets, Electrification of Medium and Heavy Duty Vehicles for Public sector, municipal fleets, state fleets, etcetera, that has certain timelines where we have to procure medium and heavy duty fleet assets beginning 2024 and then phasing all the way to 2027, where those assets have to be one hundred percent zero emission purchases. And then also the other timeline of 2040, which has us having to purchase all assets in a noninternal combustion vehicle classification. Then going down to electric vehicle master plan that was completed last year, I believe, was when it was finalized, highlighting the replacement of over 1,500 vehicles within our fleet at a cost of $110,000,000 And then looking at the cost of the infrastructure, which is additional $65,000,000 And then also that would create a reduction of 123,000,000 metric tons of greenhouse gas emissions by our fleet.

The next slide just shows two main charging hubs that were put in, through the PG and E project several years ago that the city operates and maintains. One is located at Asbury Street and the other one on the right hand side shows the charging hub that's in our Mayberry Courtyard. And I will mention that since I took over as fleet manager in 2019, we've gone from 41 light duty EV vehicles to over two forty light duty EV vehicles. So we're really continuing to move the needle year after year. Availability and talent.

So this slide talks a little bit about what we currently have. As Walter mentioned, we have 53% of our current fleet inventory that is on alternative fuels and continuing to grow year after year. And then staffing limitations and budget limitations. We continue to see that our city fleet inventory grows year over year, but our internal fleet management division staffing has stayed the same with net one to two FTEs since 2008, I believe, again, with our fleet growing year after year to provide services to our community. Manufacturer availability.

So as we continue to look at pushing our fleet forward and electrifying our fleet, we also have to take into account that some manufacturers may or may not make it. So we need to be smart in our decisions as far as electrification, knowing that we don't want to get stuck potentially with vehicles that become challenging to repair and maintain just for the sake of being clean. One instance of that within our current fleet inventory, we have a large shuttle bus fleet at the airport that, that company has gone out of business and is becoming harder and harder to keep those assets providing the services to the patrons of the airport. We're basically robbing Peter to pay Paul at this time, trying to make sure we can keep those assets as available as possible. Again, so using that to kind of be the framework of our decision making for electrification based on the vocation.

And then city operational growth. As mentioned before, we've had since fiscal year twenty twelve, twenty thirteen, we've had over 400 vehicles and equipment added to our fleet and no staff to help manage that backlog of repairs, PMs and inspections. So as I discussed earlier, challenge for procurement can be daunting for our staff. We currently our procurement team has a staff of two people that are in charge of roughly two fifty to 300 procurements annually, whether it's a standard procurement where it's a cookie cutter off the shelf truck, say with minimal build or a deep technical build where you say we're buying a type one fire apparatus for our fire department, which just in developing the specification alone, it takes roughly three hundred hours of staff time to develop that spec before that specification even gets published for bid. So so having a staff of two trying to manage that that portion can be challenging, also trying to meet our customer needs.

And then again, that's just to get the spec out to bid. We haven't gone through the bid process as well as the initial build meeting and then the mid of construction, final inspection to where it takes roughly for that type of vehicle, takes roughly thirty six months to get that vehicle delivered to the city of San Jose into the end user's hands to be able to provide services. And with that, I'll turn it back to Walter.

Great. Thank you so much, Dave. So the challenges that we're facing is a multitude when it comes to the state regulation. Even though the federal administration has really, took a step backwards in regards to some of the electric vehicle requirements, The state has not. We've met with CARB many times in terms of just sharing some of the challenges that we've had, based on vehicle availability, budgets, infrastructure needs for the chargers.

That really doesn't move the needle with them in terms of those conversations. They've indicated that it is something where they will still continue to move forward with these regulations, these compliancy laws. If municipalities can't accommodate based on budget availability, etcetera, that is not their problem necessarily. If we indicate that we cannot find an electric equivalent on the marketplace, they will help find, available suppliers, manufacturers, distributors of that vehicle equipment, so the closely matching type that we can based on our needs. Councilmember Cohen, as mentioned earlier, if we cannot find that particular vehicle through all of our procurement means and we have to go with a nonelectric version, as a one for one match, we will list those conditions inside that council memo, just advising what is available, what is not available, and what doesn't meet the need based on the feasibility and the suitability study for for that department's operations.

With that, though, the exemptions for CARB, we submitted listing. We have not heard back in terms of whether they would accept it or not. We do understand though that the exemptions are really thin and they do scrutinize them quite a bit. The exception the exemptions that they will provide is if there is a replacement need based on vehicle theft or if it doesn't meet the conditions again and it's just not available in the marketplace at this point. Rental vehicles, as we mentioned, we have quite a bit within the city's fleet now even though they're not city owned assets.

Those are still exempt from the card requirements at this point. Processes and timelines. As David mentioned, the specifications and the procurement, that does still take quite a bit of time. So either half a year to upwards of a year to write that specification when we have two FTEs doing that work. It really is a daunting task, and that's why there's so many, backlogged new vehicle requests or replacement vehicles that are trending in the multi hundreds at this point.

We have nearly 200 backlogged vehicles that we can't get to, whether it is based on the timing needed for the spec specifications writing, the procurement, or just not having budget, the general fund budget or even the enterprise budget for those vehicles. Then once it is able to go out to procurement, the vehicle build timeline could be is what you can see here. A year, two years, three years where these manufacturers, especially for the specialty vehicle type and the vocational vehicles, it does still take quite a bit. They are custom builds at times. And much of our staff's time is also going on inspections, viewing the builds, prebuild, during build, and after build.

We don't wanna take possession of those vehicles if they're built incorrectly. If we have them transported here to San Jose, then we find that they're building correctly to send them back. It's just more time and money. Those inspections are critical just to make sure that we are getting what we're paying for and it's built correctly and safely. The staffing though, I just want to mention again in regards to the timelines and the processing.

Dave mentioned the two FTEs for acquisitions. We have 42 mechanic related positions within our fleet staffing. So of the 62 FTEs within the fleet division, 43 are mechanic related, whether those are senior mechanics, mechanics, mechanic apprentices, or equipment maintenance assistance. We have 43 managing almost 3,100 assets. And although we process 20,000 work orders a year, there are still many more preventative maintenance.

We're backlogged by 1,500 preventative maintenance work orders. During the DMIB, we had mentioned how critical preventative maintenance can be to really have an asset last as long as it needs to be before a critical replacement or an emergency replacement may be needed. We're 61% deficient. We have 43. Based on industry standards through the National Association of Fleet Administrators and the calculation that we have based on the ratio of fleet equipments, we need to be at 110, and we have 43.

So to the very best of our abilities as we're trying to push out and repair and service the vehicles back to our partner department's hands, we just can't do it fast enough based on, staffing limitations as well as nonpersonal budget limitations as well. The budget limitations, as we mentioned, so when we have a general fund allocation annually of about a million and a half dollars, that really only gets us between six to 14 vehicles. And, it is all dependent on vehicle type and the associated options that we have for those vehicles to really properly give the departments that infrastructure within the vehicles to make sure that they're doing their job safely and appropriately. The electric equivalents can be 200 to 300% more of what we're seeing for an internal combustion engine vehicle. Just using Beautify SJ's program as an example, the the debris body collection vehicles that they have, a normal unleaded or diesel gas vehicle is about a $108,000.

The electric equivalent is $250,000, and that's not including the charger. And the charging equipment, again, as a level three, that is a much heavier cost, just to get that infrastructure in place also. And as we mentioned, we we need the chargers. We need the facility electrical upgrades. That is an opportunity, though, that, we'll mention in this next slide, where from a funding perspective, we have been pursuing and identifying and applying for grants, and we've won.

Last year, actually, in in 2024, we are working with the the federal department of transportation. They continue to offer a charging and fuel infrastructure grants where, in early twenty twenty five, January 2025, the city was actually granted a $12,000,000 award specifically to help with electrification of our fleet and infrastructure that goes behind it. Unfortunately, two to three weeks later, when the new federal administration had taken over, that grant was frozen and rescinded, and the city did not receive that allocation that would have really helped put several level twos and level threes into our, into our inventory. But that's not stopping us. We're gonna continue to look at very strategic approaches for funding opportunities, including more grants and any other funding assistance and incentives, we can we can find out there.

With our partners like the energy department, there are some internal funding strategies that are currently taking place. As led by the energy department, there

is

a fast charging hub program where it is allocating, enterprise funding from other operations to really put more chargers in community based facilities. And this would be more so in areas whether downtown core or areas within a low income and disadvantaged communities, more for that, public accessibility to those charging, to that charging equipment, whereas City Fleet can also use those, those chargers as well too. Utility programs, as mentioned on the last slide, we are working with PG and E. There's a program called Rule 29, which we understand that certain areas, certain neighborhoods, certain block circuits that they provide that service may not have enough electrical capacity for more of the electric vehicle charging stations than not only what the city needs, but our neighboring entities as well too. And especially in some of these commercial and industrial zone locations, you may have a UPS, a FedEx, an Amazon, Depot where they are also electrifying their fleet.

They're also competing with the electrical service that we need to power our fleet and work with PG and E advising them what is our time frame, what is our needs, and reserving that electrical capacity for those specific facilities and those accounts that we need that electrical service to be in. More so for our corporation yards. So the Mabry Yard, South Yard, West Yard, that's where we have a lot of our heavy DOT operations and a lot of those heavy duty equipment that we just can't continue to not have charges for them and still have daily operations that they would need to do, for for, the residential areas. The other opportunities, so we are looking at rent to own, where these are very similar to other rent to own opportunities, we are renting vehicles until at a point where we can ultimately own them. Granted over that time frame, we would be paying more than a straight out initial purchase, but that allows us to have lesser of a capital cost to begin with and get the vehicles in a bit faster.

Charging as a service, that would be the city not owning the electric vehicle charging stations. It is almost similar to a power purchase agreement that we have for our solar energy systems where another third party, provider will install and operate and maintain these charges for us. We just pay the subscription fee, but they take care of all maintenance and the service out of those chargers. Then charge in the wild, that's what we call it. It's trying to get open purchase orders for those vehicle charging stations that you're seeing at the strip malls, the parking lots, the third party parking lots.

This is another opportunity where if they're available and our city fleet vehicles can charge at there, definitely not convenient. It could be more expensive down the road, and it is subject to availability. But these are more of the creative options where if we can't get the initial capital costs and the chargers installed in our city facilities, these are the op other options that we're looking for the fleet and for the charging equipment. With that, that concludes our presentation, and we are open to any questions.

Thank you. I I as you know, I've been looking forward to seeing this detail for a while, so thank you for the thorough report. I don't think we have any members of the public here, so we'll come back to the committee. Don't see any hands raised, so I'm going to ask some questions. First of all, are options for medium and heavy duty EVs starting to get better? I know that that's been a big limitation, that there's been this requirement to do it, but there's not a lot available. Are things starting to get better?

Yes and no. And I'm going to partially answer the question, Shercoen, and then I'll transition it to David Mesa to completely answer the question. There are manufacturers that continue to evolve their technology, whether it's prototypes or those that really hit the market as a market available vehicle. Similarly to your inquiries back in October, the tractor drawn aerial, so the ladder trucks in the fire department, they don't have an all electric equivalent as yet, but the water pumper trucks do. And that's something that as we're looking at future procurements, that'll be something that we'll be looking at electrified fleet option for those vehicles.

Then you have the other side of the coin where outside of California and the very few states that still have the very stringent EV regulations and compliance, rules, many other states don't. And when it comes to manufacturing, some of the manufacturers are not seeing the market available for them. So just using Ford as an example, as you may have heard in September, Ford stopped making the f one fifty Lightning, the all electric pickup truck. And that was something that we are buying quite a bit of just based on the operations needed here. Because Ford and through many alter all the factors as I'll tell you, one of the main factors was they just weren't getting enough sales maybe outside of California.

They just weren't getting enough. And they've halted that production. That really limited us then to just then the all electric Chevy Silverado. Unfortunately, we can't afford Rivian. The price point is gearing us towards the Silverado.

But then even at that, the competition to get the EV Silverados then across all municipalities within California were all competing for the same set amount of availability. So with that, although we'd like to hope that as more of these regulations are in place, that would prompt more of the manufacturers to build and make available and stay in business versus what we're kind of seeing, yes, that is coming to the forefront and there are emerging technologies. Then for other common technologies and very common vehicle types, those, unfortunately, are being halted in their production.

Okay. On the funding side, you mentioned grants. Are are are these you said mostly DOT, but are there some does the state provide any funding to help achieve the goal that they've set?

We are looking at any available incentive programs, whether it's through the state. We we are still pursuing federal grants as they're made available as well too. But anything that we are seeing, we have been applying, and we're getting consideration. It's helpful also as we're going in a joint effort. So whether it is with other county partners, really showing the bigger need within the region and getting more consideration there.

There is more weight for those that are applying with the LIDAC in mind, the low income disadvantaged communities, where if we're looking at a combined shared charging infrastructure for both municipal fleet and members of the public, and even employees, employees are buying more electric vehicles as well too and providing an opportunity for them. Those are where we're seeing more of the opportunities for those continued grants, and and we are still identifying and applying for those. Yes.

Okay. I would hope that prop four and cap and trade money would be available for this. I'm I'm just curious. You know, the the the state is saying phase out by 2040. Phase out doesn't just mean that's the point at which of all purchases have to be. It's supposed to be that all vehicles that are not EVs are are decommissioned by then. Correct. But clearly, the lifespan of a lot of these vehicles is longer than fifteen years. 2040 seems a long way off, but it isn't for the purchase of a vehicle. So

That's correct. And that's why yes. And that's why we're actually still building a fueling island at the Central Service Yard because we know the vehicles that we're still able to buy now that are unleaded or renewable diesel, they'll still need fuel even beyond that. But to your point, Sheriko, in the next fourteen years, it's not a matter of whether they can still go, it's a matter of is there one available that's equivalent on the regular basis enforcing that change?

Right, right. Did you want I feel like you're stating that like you want say something.

Yeah, well, was just going to mention, as Walter said, so we as fleet management, we look at every single procurement and do an EV suitability analysis. And yes, there are legacy manufacturers and growing manufacturers in the medium and heavy duty space that continue to provide products. We look at the individual vocation to see if the electric vehicle fit for that location will work. For an example, like DOT sewers, when they request a medium duty truck, they need a large crane to be able to move sewer pipes. That isn't available right now at the marketplace because of the amount of battery that we utilized to move those big large pipes.

So that's something where it doesn't fit right now. We will continue to year after year do that suitability. If something comes to market, then we can pivot and make that switch. But then you have like, say, just a debris body truck for PRNS or public works or DOT, where that's available and it's a viable option. So that's where we would look to put them in an electric vehicle at that point. So we do continually update and look at these vocational vehicles to see if there's a good fit.

The requirement in the state is 100% purchased by 2030. So that requirement is not just for light duty, right? It's for all vehicles?

That's just for medium and heavy duty.

For medium and heavy, 100% Yeah, purchased by 2000

duty isn't factored into it. That's just for medium and heavy. So ACF regulatory compliance is for medium and heavy, which is Class III to Class VIII, which is kind of getting into the weeds. So for those vehicles, that's the requirement. That's

But not there's not really any possibility that we can achieve that. There's not enough choice out there of vehicles to do that. Right. Okay. So anyway, just going to be an interesting point at which we're not in compliant with the rules.

Interesting to run up to see if the timeline gets pushed back as we get

closer to 2030. Right. I mean, we we wanna keep it moving, but we also have to be realistic. So right now, our our for light duty vehicles, are we at a 100% on light duty?

We are at 100% of replacement

Replacement, that's what I meant.

In adds, not existing fleet.

Right, right. What percent you said I mean, was impressed by the number of how many how much the fleet has grown light duty fleet has grown. What percentage of our light duty fleet is now electric?

I don't know that number off the top of my head. But we could follow it.

I mean, 20%, 80%?

It is about 20% -ish. Okay. But I will follow-up with the exact number.

Because as we talk about our goals of being carbon neutral by 2030, obviously, we don't want to necessarily buy vehicles before we have to. We don't necessarily have the budget for that. To even think about being carbon neutral by 2030, we should be thinking about having our entire at least what we can electrify be electrified. Otherwise, we haven't really tried to achieve the goal. So I'm just one wondering what it would take for us to be a 100%. What what you know, would there be more invest obviously, more investment needed. What would it take for us to be a 100% of our light duty fleet elect electric by 2030? Maybe that's not something you can answer now, but I wanna think that through.

That's an interesting challenge because whether we to your point, whether we decommission existing assets that still have viable lifespan with just that one goal in mind, and so that's that tricky balance. And then even if Dave and his team can acquire and put in place, then we also have to then decommission all those vehicles at the same time. So there's that push and pull. And then do we have the charging infrastructure at the places in which they dwell so that they can charge in the times that they're needed in place, in time for that whole thing to work.

Right. And just just a question. We've set an Sure. We've set an ambitious goal. When we knew that setting an ambitious goal meant we would have to do some uncomfortable things to get there, so I'm just kind of throwing that out there that this is one of those uncomfortable things. In some sense, it's the one thing that's possible. There's a lot of other things that that are not even possible. So I just, you know, wanna keep that elevated. Okay. I guess that's that's my last last two questions. I'm excited to see the electrified Danny the Dragon. You know, there although I joke about the the old charm of part of the charm being having to breathe in that black plume of smoke that came out of the engine as you were riding in the in the ride. But, actually, it's better that we don't have that anymore.

The real dragon effect as we thought.

Yeah. Exactly. Alright. Do we have a motion to accept the report?

So moved. Do that go?

Alright. We have a motion and a second. I don't see any other hands to ask questions, so we'll vote. And we can hold the vote for one second for our colleague to or we'll let him throw his vote in when he comes out. So it's right now, it's four zero with Ortiz missing. And we will move on to item three. Thank you for the report. Appreciate it. Our last item on the agenda today is our clean energy roadmap status report.

Good afternoon, council members. My name is Lori Mitchell, and I'm the director of the energy department and very pleased today to be joined by Kate Ziemba. She's our deputy director over accounts, marketing and communications. This item is our program's roadmap. And so today, we'll go through a little bit of background on the program roadmap, overview our current programs as well as recommended changes for fiscal year 2627.

And then finally, look at our recommendations for the next five years from 2026 through 2031. Just as background, back in 2021, city council approved the following guiding principles for our program's roadmap, which are to reduce greenhouse gas emissions, promote equity, increase affordability, and support environmental justice communities, benefit our customers and the community, maintain or improve the financial status of San Jose Clean Energy, and then finally, to align with our climate smart city goals. As background, you saw saw this slide with our rate item a few months ago. The PCIA is a fee that is charged to our customers, to account for the resources that were supplied by the investor owned utility before San Jose Clean Energy launched. As we noted in 2026, our customers will pay $132,000,000 in this fee, and we are offsetting that by using a significant portion of our financial reserves.

So in 2026, we anticipate using about a 108,000,000 of our reserves to offset that charge. And in 2027, we think that this charge may remain at almost the same rate as what we're seeing here in 2026. And so this has informed how we are recommending the budget for our customer programs. Over the last year, we have spent about $10,000,000 on our customer programs, which is great progress. And so what we're recommending is to keep that spend the same next year and to overall have a stable program budget over the coming years versus expanding it and then retracting it as our financial condition allows.

And so with that, I'm gonna pass it on to Kate to talk about our recommendations.

Thank you. Kate Zieba, deputy director with the energy department. So we currently offer 12 programs across four main areas, residential

electrification incentives and financing, EV charging and transportation

12 programs, customer support, including bill assistance and education, and then demand flexibility. We also offer three workforce development programs. Last week, we launched an incentive for contractors who are new to heat pumps, $1,000 per installation for the first six installations. We believe this will be an effective tool to help more contractors, including high road contractors, break into the residential heat pump market. We published the high road badge last fall, which recognizes contractors who pay prevailing wage, after offer family health care and benefits, are affiliated with an apprentice program, and ensure their workers have safety certification.

And we develop those criteria with our labor stakeholders and have presented to contractors about the badge in our programs, and we'll continue to conduct outreach. We're committed to helping our local workforce prepare for the air district regulations and doing our part to ensure decarbonization jobs are high quality. Through the 2025, we estimate our programs will save customers 29,400,000.0 in lifetime savings and avoid more than 46,000 metric tons of c o two and save 35,000,000 kilowatt hours of electricity. Through our programs, customers have installed more than 300 chargers, bought 113 EVs, installed more than 1,100 heat pumps and a 107 battery storage systems, and together have created nearly, two megawatts of flexible load to help stabilize the grid on high usage days. And now we'll go into our recommended programs for next fiscal year.

Let's start first with how we arrived at our program recommendations. We wanna create energy programs that our community wants and needs. We have a staff member who's dedicated to community engagement and conducting needs assessments. We also receive input from the climate advisory commission and collaborate with other CCAs and utilities to understand their most impactful programs. And so we put together program ideas through our scoring framework to help prioritize, and we calculate scores for programs using five metrics that map to our program guiding principles.

And so what we're presenting is a recommended recommended programs reflect the highest scores. As Lori mentioned, we recommend spending a maximum of 10,000,000 on programs next year given the PCIA, And we recommend continuing to offer the 12 programs on the previous slide. We continually iterate these programs, learn from what we're seeing, and, from others to improve them. We propose to add two new programs to fill gaps. The first is providing free technical assistance for our commercial customers to help them electrify their buildings and implement energy efficiency with a special track for restaurants and food service, which are typically very high energy users.

The second is a pilot program for renters that offer a low or no cost portable heat pump to help provide cooling to units that don't have it and efficient heating. We estimate that implementing these programs next fiscal year will save customers 16,000,000 in lifetime savings and avoid more than 33,000 metric tons of c o two. This year, we're also excited to produce a five year programs road map. In 2021, energy department first published the program's road map that outlines the types of programs SJCE may pursue over the coming years, and we committed to updating it every five years. And so here we are today to present another recommended update covering 2026 to 2031.

The road map provides the strategic direction and options for programs, and then we continue annually to conduct detailed prioritization and program design and bring those recommendations to the city council. For this road map update, we conducted two residential surveys in multiple languages. The first was to understand energy needs and barriers, and then one at the end of the engagement process to make sure we heard the community right and hear reactions to our proposed programs. We also conducted three residential listening sessions in English, Spanish, and Vietnamese. And then finally, we reached out to more than 80 stakeholders across multiple fields, business, community based organizations, environmental groups, labor, and city departments.

And we value our stakeholders, and their input is reflected here. So a bit about what we heard. It's no surprise that affordability was top of mind for everyone. Customers really want to adopt clean energy technologies to unlock lower bills, but the upfront cost of that technology is often a barrier. Housing constraints are also a barrier, particularly for renters and multifamily customers.

And while we heard that there's broad support for energy programs, customers emphasize a strong desire for bill savings, renter options, and simple participation. And so the program's roadmap contains a list of 23 potential programs to explore over the next five years. The overarching themes are focusing on affordability, accelerating adoption of EVs, heat pumps, solar, expanding access to charging, and using demand flexibility to reduce cost for all and support the grid. So before wrapping up, we wanted to take a moment to thank the stakeholders who informed the road map for their time, expertise, and feedback. So our recommendation today is to accept this update on the program's roadmap and recommend this item for full council consideration at the May 19 meeting.

And with that, we'll take questions and feedback. Thank you.

Alright. Thank you. I think we still don't have public comments, so we will come back to the committee. I have just a few questions. The this past year, we implemented the the incentive for the installer as part that that's rolled under, I assume, the heat pump rebate program that's the line item here on the list.

Thank you, council member. So the incentive for installers, we actually just launched that last week, and we included it as a workforce development program.

Oh, that's under the workforce development. So that what it was at, a thousand dollar for the first five or whatever? So that'll be under that program. And it just started, so we don't have any we'll find out soon whether how many people start taking advantage of it. Okay, great. The ongoing $10,000,000 a year that you're sort of recommending, this year, fact that it's 10,000,000 is partly due to the high PCIA. If if PCIA drops again, and we hope we hope that things will get under control in the PCIA, would we be have more resources available to to increase the programs going forward?

Yeah. That that's a great question. So so yes. You know, if the PCI was lower, we would likely be here today recommending an expansion to our customer programs. But we think it's prudent to to keep it at a stable amount so that we're not going up and down every year. And our customers can count on a certain amount of customer programs for us. I will say it will always be a trade off between rates and what we're putting into customer programs, and those decisions will obviously always come to the city council.

Yeah. I mean, obviously, we've seen that there's some skepticism among some people. But as time goes on, my thinking is that there will be more and more people wanting to adopt this technology and that the potential customer base will grow, especially as people get more more people take start doing it and they start sharing their experience with others, I suspect we might see demand increase for these programs. So that's why I just want to think forward about how we might handle it if that demand grows over time, especially if the air district holds on their policies and we begin requiring they really do phase out the availability of gas appliances, we'll have more people that want to apply for our rebate.

Yeah. I think that's an excellent point. I think already we're seeing a lot of demand for these types of technologies, which is great. And as we can expand our customer programs to help more people access these technologies, that's certainly something we'll always be supportive of. Right now, we are recommending a large portion of our customer programs go to income need in terms of our customers so that we can close those gaps for people. But we know that there's a broad broad array of customers that wanna participate in our programs. And and in general, we'd love to expand them.

Alright. And then my my last question is on well, second to last question. But table five in the report is estimated potential emission reductions and has the numbers growing modestly over the next five years? I'm just curious, so these numbers are the actual one times the incremental addition to the savings, but there's ongoing savings as well. These are not cumulative numbers, are they?

Do you want to take that? Yes.

So in each year, the savings is due to whatever equipment is being installed in that year. So it's the total savings over the lifetime of that equipment. So the total

Oh, so these are lifetime savings counted on the first year of when they're installed?

Correct.

Okay. Alright. Makes sense. Thank you. And then my last kind of question, it's a little bit on the side. It's not necessarily related to this. But over the weekend, I was exposed to this idea of community solar that people who can't necessarily do it on their own roof or their renters and they want to buy into solar can buy into an installation somewhere, kind of like a time share almost. We have have we heard about any demand or interest in that kind of programming here in San Jose?

Yeah. No. There's a lot of interest in that in that. We run a program that's similar to that for income qualified, and I'll let Kate speak to that. So so there's that option where they're essentially taking a portion of a renewable energy project that's located somewhere else. There's also a bill going through the legislature, which is pretty exciting. That's, termed balcony solar where a customer could buy a solar panel from a Home Depot or some type of store like that. And it actually fits over a balcony and you can plug it into your your socket inside. That type of technology is already being used over in Europe. So we're watching that bill and, you know, that'll be interesting particularly for renters and multifamily buildings.

And I'll let Kate just talk a little bit about the community solar, project we have.

Thank you. So our solar access program is actually one of our longest running programs. We launched it in 2021. That's a community solar type program. It's entirely funded by the CPUC. And so, about 950 customers each month get a 20% discount on their whole bill, and then we source 100% solar from them from a small array in Merced County.

Okay. That's great. Yeah. I mean, it's a pretty neat idea that people could say, I wanna buy solar, but I can't put it on my house. And then they can even take it with them when they move from place to place. Right? They don't have to if they're renters, they don't have to have it fixed to the home that they're renting.

Right. Right. Exactly. You know, it's something we're supportive of. And then, of course, I'll plug our total green product, which if people are interested in having a 100% renewable energy, we can source that for them, cost about $5 a month on your bill. So that's always an option for our customers. And importantly, people can opt in and out of that program. So if they can afford it today, they can be in our total green. If in a year or two that doesn't make financial sense for them, they can always go back to GreenSource. That's always a great option for our community as well.

Great. Okay. See councilor Campos, your hand went up.

Thank you, chair. I will move to accept the staff recommendations and just with one quick question. Thank you for providing this update and I'm remembering maybe at last year conversation with council about the I don't know if you call it a reimbursement, but I know right now my we have like San Jose clean energy gift card. Last year the conversation was around are there alternative ways that we when we have a surplus maybe could be reinvesting that in our community and so if council wanted to provide an alternative way of using those surplus credits or dollars is the May 19 City Council meeting the appropriate meeting for that recommendation or what would be the the steps and pathway to start to have that conversation about alternative ways of of using those savings?

Sure. I think in May that would be an appropriate time. Also happy to work with your office in advance of that if there's something specifically you're thinking about. But if I'm understanding you, you would like a bill credit or gift card or something like that for certain types of customers instead of maybe a rate discount or another type of customer program. Is that what you're thinking of?

No. I so I think this was when we had council member Solace with us on council. And I think it was something that he brought up. When we have a surplus, I think the automatic way of redistributing those excess dollars or those savings was to just allocate every ratepayer some kind of card. Like I have a gift card at my house.

It's like a Visa card $30 $50 something like that. Guess I'm bringing it up because I'm thinking about when California had like the stimulus cards that went out statewide and now the state is reporting there's like 4,000,040 million. I don't know some several million dollars that have not been used. I'm just remembering that conversation and thinking about how there was some interest from counsel in if these dollars could have an alternative way of maybe being utilized for the you know whatever it is that council wants to use. I'm just curious about where where that would be where that conversation would be appropriate.

And if it's at that May 18 meeting, then happy to think about some ideas. And like I said, I I was just curious about that.

Yeah. So on May 19, what the council will be considering is this program roadmap. And so the recommendation from staff will be as it is today to, accept and approve the report, which will allow us to launch these programs. Certainly, could consider an additional program. I think what you're talking about for your gift card is one of our programs, demand response program, where if you participate in it, you save energy and some of that is credited back to you, which I'll let Kate talk in a little more detail about.

But in terms of a surplus, typically do not have a surplus. If we do, we'll recommend one of really three things. One is to put more funds into our financial reserve to offset future increases in the PCI. So particularly in our early years, we very much focused on building that financial reserve. The other thing that we would recommend is rate change.

So just lowering our rates if we're collecting essentially too much. And then finally, what we would recommend is an expansion of customer programs. We typically try to do a mix of those things, right, because we think all three are important, having that financial reserve, having competitive rates and having programs that are valuable to our customers. So that's typically what we would do with any type of surplus. But certainly happy to partner with your office on a program such as that demand response program or some other type of program for residents that you're thinking of. And I'll let Kate talk a little bit about that that gift card program that you're referencing.

Thank you. So we have a program called Peak Rewards. It's a demand response program, which basically means that during certain days of the year when the grid where there's a lot of demand on the grid and we call in our customers to reduce their energy usage. And so this can look like it's it's called behavioral demand response where, you know, you just don't use your dishwasher or you turn off your lights, and that's how you save energy. Or it can be automated where you enroll a smart thermostat, and then that is adjusted wirelessly.

And so in order to get customers to, participate in the program, we've given gift cards in the amount of $20 to have them enroll. And then any kind of usage reduction, we pay them for that via a bill credit. And so if you received a gift card from us with our logo, it's it's likely you enrolled in our demand response program.

Okay. Well, thank you again for answering those questions. And, yeah, happy to follow-up in preparation for that May meeting.

We had a motion. Do we have a second?

Second.

Alright. Have a motion and a second, but I'm I'll just follow-up on that. Just keeping in mind that this set of programs also was is in the context of already having taken a vote at the council. Was it December to provide the on bill credit for January and February. So a portion of this year's savings and reserves already has been credited back to the rate payers through an on bill credit, and this is the other portion of all that money being used for our ongoing programs.

And then that other program, Peak Demands, which has the enrollment bonus, I would think that that's kind of a separate conversation from the May 19 discussion. If someone wanted, and it's a reasonable conversation to have about how to structure that program, presumably that that would maybe work on something for like a rules memo to bring forward on a new approach to that program that we could discuss separately from May 19. That'll just be my recommendation. Good. I don't see any other hands, so let's vote.

Alright. That item carries five zero, and we're on to open forum. Looks like no one's here for that either, so we're adjourned at 02:56 p. M.