Alright.

Good afternoon, everyone.

Welcome.

I'd like to call in order this meeting of the San Jose City Council for the afternoon of September 9th.

Welcome everybody.

Tony, would you please call the role?

Kameh.

Campos.

Present.

Tortillas?

Here.

Cohen.

Ortiz.

Present.

Juan.

Here.

Kendallas.

Here.

Casey.

Fully.

Here.

Mayhand.

Here.

You have a quorum.

Great.

Thank you.

Now, if you're able, please stand and join us for the Pledge of Allegiance.

If you just apply.

Thank you.

Today's invocation will be provided by the Art of Living, and Councilmember Condelis will tell us more.

Thank you, Mayor.

September is Council District 8's turn for invocations, and I am excited to introduce today's guests for all of us to hopefully find a moment of peace and clarity as we welcome the Art of Living, a global secular non-profit organization committed to uplifting and empowering individuals and communities with a focus on stress reduction and mental well being.

While they have a global reach across 150 countries, I'm grateful to have Art of Living Evergreen in my district and in fact my neighborhood.

They have provided a welcoming and accessible space for residents of all ages and backgrounds to gather through their regular events entitled Yoga in the Square.

I'm lucky to have stopped by one of their events earlier this year, fully able to experience firsthand how simple tools like breath work and short meditation practices can be a powerful method to find a moment of peace and improved mental clarity.

I'm grateful that they're able to be here, and now I'll invite JP, Shivani, Kanchana, Jayanth, and Samya to lead us in today's invocation.

They will share two chants called Shlakas in Sanskrit to wish well being upon everybody.

And we'll start with the chant.

Oh shante shante.

So the chants mean, the first one, plus chant means take us from phenomenal world of unreality, and make me go lead me towards the reality of the eternal self.

Take me from the darkness of ignorance to towards the light of spiritual knowledge.

Take me from mortality of material attachment towards the world of immortality of self-realization.

And the second chant means.

May there be peace in everybody.

May there be fulfillment in everybody.

May there be auspicieness, auspiciousness in everybody.

And let there be peace within me.

Let there be peace in my community, and let there be peace everywhere.

See, peace starts at the level of individual, right?

And then the summum bonum of that piece is what becomes collective peace.

It does not start top-down, it really starts bottom up, right?

When every individual feels peace, that is when everybody feels peace, isn't it?

Yeah.

That's one thing.

And you know, the Art of Living Foundation is poses this principle called Vasudhaiva Kutumbaukam.

In Sanskrit it says Vasudhaiva Kutumbakam.

What it means is whole world is one family.

We all belong to each other.

That brotherhood belongs in the whole world.

Not just, you know, boundaries are very artificial.

Right?

We draw the boundaries, but earth does not have boundaries really, isn't it?

So one world family, when we believe in that, there is brotherhood.

And that's what you know, art of living is been spreading for the more than 45 years.

And thank you for giving us this opportunity.

Thank you, Mayor.

Thank you.

Thank you.

Alright, and again, that was Art of Living.

Thank you for the chance to start off for a meeting.

Thank you, Councilmember Condelas.

We're on to ceremonial items.

Uh, Councilmember Campos, if you would join me at the podium, we will recognize September as transit month.

I believe Vice Mayor Foley is also joining us.

Thank you.

I apologize.

I did not have that on my script, but please, whoever is joining us, let's do it.

Good afternoon, everybody.

My name is Pamela Campos, and I am so excited to proclaim and designate September as transit month.

It is critical that our city and our county provide equitable and accessible public transit to all communities.

For some families, we know that owning a car is very expensive, and public transit is their main mode of transportation.

This is why we have to commit ourselves to long-range transportation plans.

And when I was elected to city council, one of the things I was most excited about was getting to ride BTA into downtown to go to work.

Today we are joined by Kaleo Mark from Bay Area Seamless Seamless Bay Area, an organization that advocates for an equitable and seamless transportation system that serves people across our entire nine Bay Area County regional transit system.

And so I will turn it over to him for some remarks.

And then Mayor and vice Mayor will join me in presenting the proclamation.

Hello, everyone, my name is Kaleo Mark.

And I just want to start by thanking the council member for.

I just want to thank the council member and Vice Mayor Foley for bringing forward this proclamation to honor September as Transit Month in the city of San Jose.

Transit Month is a regionwide celebration of the central role that public transportation plays in bringing our communities together and also our region's economic, cultural, and social vibrancy.

Every September for the last five years, Transit Month has brought together Bay Area community members, advocacy organizations, public agencies, and businesses who all recognize the value of public transit and are working together to increase awareness of its importance.

Transit Month continues to grow bigger and better every year.

This month there are more than 70 events happening across our region.

And these include a wide range of activities like transit themed art pop-ups, socials, educational sessions, such as highlighting how we can protect our immigrant neighbors and friends who rely on transit, group outings to sporting events, museums, transaccessible hikes, and dozens of other events.

In San Jose specifically, there are some exciting events still coming up on the calendar if you guys are interested.

So on Sunday, September 21st, folks will have the chance to ride on a historic South Bay Electric Trolley at History Park, which is operated by History San Jose.

Then on Monday, September 22nd, San Jose State University's Transportation Solutions will host a panel discussion, which will center the voices of students and leaders shaping the future of South Bay Public Transit.

And then VTA will be hosting their strategic plan open house at the Roosevelt Community Center on Thursday, September 25th to talk about the future vision of South Bay Transit.

The open house highlights current and future efforts for transit ordered development sites, bike and pedestrian projects, and transit service planning.

And all month-long VTA will be promoting their smart commute program where people can earn rewards by walking, rolling, and riding VTA to work.

And this past weekend, we're grateful for Council Member Campos and her team for organizing a transit accessible group bike ride to VivaCay.

So as we celebrate Transit Month this September, we recognize that the future of Bay Area depends on our communities having access to high quality public transportation options.

It's key to achieving our most pressing goals such as building more housing, reducing the cost of living, combating the climate emergency, improving mobility options, especially for older adults, people with disabilities, young people, and our low-income neighbors, and reducing socioeconomic equality.

So thank you again for recognizing Transit Month and uplifting the importance of public transit.

So also we have a problem with Council to proclaim September's Transit Board.

Well, why don't we get a photo over here?

Go ahead.

Today I'm proud to recognize Paths Santa Clara County and the incredible impact they've made.

Welcome in San Jose over the past 10 years.

Path began serving our community in 2015, starting with outreach to unsheltered individuals downtown.

In just a decade, their work has grown to include rapid rehousing, housing navigation, employment assistance, supportive services, and several interim and permanent housing communities.

Through their development arm, Path Ventures, they continue to expand affordable housing options in our city.

Their interim housing sites, such as Evans Lane and the Pacific Motor Inn provide stability and hope, with Evans Lane alone helping more than seventy-five percent of families move into permanent housing.

What makes Path so special is not just the scope of their work, but how they do it using trauma-informed person-centered approaches, and even ensuring their sites are pet friendly.

They meet people where they are with compassion and dignity.

Path's success is also powered by partnerships with companies like Apple, Google, and Cisco, with cultural institutions like City Lights Theater, and with local churches, neighborhood associations, and even our local sports teams.

Thanks to their efforts, Path has served thousands of residents in Santa Clara County.

Please join me in thanking Path Santa Clara County for 10 years of transformative service to our community.

So let's do that.

Thank you.

And now I would like to invite Tamra Chavez, Path Silicon uh Santa Clara County's Regional Director to say a few words.

Tamra, thank you.

As the regional director for PATH, I want to thank the mayor and council for this wonderful recognition.

We feel fortunate to have worked over the last decade with many great partners here at the city of San Jose.

In addition to the various elected leaders here, I want to shout out the housing department team for their commitment to serving the most vulnerable among us.

There's much more work to be done, but we are exceptionally proud to have helped over a thousand individuals into housing over the last decade.

On behalf of myself and all of 65 of my team members, thank you so much for this honor.

We are fully committed to continuing this important work for all of you.

Thank you.

Awesome.

We all appreciate it.

This is signed by the entire council.

Yeah, you guys think you guys said good to see you.

Appreciate you.

Alright, we're keeping the ceremonials efficient today.

We are on to orders of the day.

I understand that the administration would like to defer item 3.4 report on request for proposal for general banking, lockbox, merchant card, and investment custodial services to next week's uh 916 agenda to do further research.

So I'd ask my colleagues to incorporate that into the motion.

Does anyone on the council have any other changes to the printed agenda?

Not seeing any.

Did you Jennifer want to share anything?

Or did I cover it?

I think you covered it.

We just want to we had received some news about a previous JP Morgan banking relationship that we'd like to review and discuss with the bank in advance and bringing it forward.

So September 16th would give us plenty of time to do that.

So thank you for your consideration.

Okay, great.

Could I have a motion to defer?

Move approval of orders of the day with the deferral.

Second.

Thank you.

Perfect.

Alright, I don't see any other items, and we do not have an adjournment today.

Tony, do we have public comment?

No, we do not.

Okay, let's come back to the council and vote.

Motion passes unanimously.

Great.

Thank you, Tony.

Let's come back for the closed session report.

Nora, do we have anything to report out of closed session?

Thank you.

Okay.

Great.

Thank you, Nora.

Next is the consent calendar.

I've got a couple of items flagged here.

Um I understand Councilmember Ortiz would like to pull item 2.11.

And I see a head nodding, and then Councilmember Kameh would like to pull item 2.16.

Are there any other items?

I don't see any other hands up.

Why don't we just go in order of the agendized items if that's okay?

So I'll go to Councilmember Ortiz first.

Thank you, Mayor.

I brought forward this recommendation because I believe our city's investments should reflect the values we hold as a community, and not just the bottom financial line.

San Jose is home to a thriving, diverse population, and immigrants are a vital part of our workforce, our neighborhoods, and our small business community.

We know that when federal policies threaten our residents, whether through raids, deportation, or aggressive enforcement, it's not an abstract problem.

Families live in fear.

Children's miss school, people avoid seeking health care or reporting crimes.

Our communities suffer.

So that's why it matters that our city is thoughtful about where our money goes.

If we invest in corporations that profit from ICE enforcement or detention, we risk sending the wrong message to the very people who are part of the fabric of our city.

It undermines trust and erodes the safety and dignity of our residents.

At the same time, I'm committed to ensuring we balance our principles with fiscal responsibility.

I understand our responsibility to manage city funds carefully.

That's why I've asked city staff to return in March 2026 where they thorough analysis of the trade-offs.

I want to see the financial implications laid out clearly so we can make decisions that honor both our fiscal responsibilities and our moral obligations.

This is about leadership.

San Jose has a long history of standing up for its immigrant communities.

From creating the rapid response systems to joining lawsuits, protecting families from harmful federal policies.

Divesting from ICE, linked corporations is a continuation of that legacy.

It's a step that says to our residents, you are valued, you are safe, and your city stands with you.

So I believe we have a responsibility to ensure our investment reflects the San Jose we want to be.

A city that is inclusive, safe, and equitable for everyone.

Supporting this recommendation is a concrete way to do just that.

With that, I respectfully make a motion to approve my memo along with the staff's memo.

Thank you, Councilmember.

So everyone should have a blue memo that came in from Councilmember Ortiz just now that has I think the recommendation and background.

Councilmember Ortiz put forward a motion.

We can also continue on with more discussion.

I've not heard a second yet.

Why don't we continue?

Let's just stay on this item for now, please, and we'll uh go to vice mayor.

Just a uh point of order, Mayor, without a second.

Do we continue on with the motion that is made?

We um I think we're still just discussing this item and see if there is a motion, or we can go back to the full consent calendar.

I I would recommend uh personally, if if anyone I mean, thus far there's not a second, so I think somebody would be able to make an alternative motion at this point, um, as I understand the uh rules of order.

Um, then I might suggest that we look at uh deferral for some more staff analysis to come back to rules, but I'm open to go.

Yes, in fact, that's exactly uh yeah.

Uh this is um the process for something like this, particularly of this scope, is for it to come to rules and then for rules to ask for a workload analysis, because during the workload analysis, we'll hear at rules what the give and take is, how much time staff feels it will take to analyze this, when they might be able to bring it back, whether it's red light, yellow light, or green lit.

So I would move a well, since it's not sex sec seconded, I guess I'll move a substitute motion.

I don't even think it's the same.

It's not even appropriate.

I'll just move that we refer item uh 2.11 to and the memo to rules for further for workload analysis.

Okay, do we have a sec?

We don't have a second on that either.

No second.

Okay.

That's second.

I'm okay with second it, but I would who seconded.

I'm sorry, Councilmember Casey.

Okay.

So there's a motion on the floor with a second.

Let me go to Councilmember Tordillos next.

Thank you.

I just wanted to note uh my recollection from KISFiz was that we already had a direction to return to city council with an investment analysis for some unrelated divestment investigations.

Uh so my only recommendation would be to potentially combine those work streams.

Okay, thank you.

Uh council member, and that may make sense.

I I don't think it would preclude staff from maybe combining the analysis, at least the current motion as I understand it.

Let me go to Councilmember Condelis next.

Yeah, no, um I I appreciate Councilmember Ortiz bringing bringing this item forward.

I I guess my question would be to to staff on on the investment analysis.

Yeah, I I I'm supportive of the underlying or of the underlying motion because or the motion on the floor now, because you know, I think it's important for us to have this conversation in public uh at rules with a thorough analysis based on what staff has to say on their impacts or workloads.

I I I I the the decision on on where we're investing is uh is a values-based decision that I think is important for us to consider.

Uh but I you know, I I want to be able to to have a more in-depth analysis um uh on this because of the sensitivities around this and how important it is to our community and and look forward to seeing that agenda is on the rules committee.

Is there a date that we're looking to have this agenda is, but uh I would rather have it sooner than later.

That's my recommendation to staff.

So Tony, given that this item has already been agendized and now is an accompanying memo, would this when would this be able to go to rules?

The next week's rules.

Next Wednesday could be on the agenda.

Yeah, great.

Thank you.

Thanks, Councilmember.

Let's go to council member Cohen.

Just a quick question.

The the motion is to refer item two eleven to rules, but I think I mean I think it makes sense for us to accept the financial report today.

So I was just gonna ask for friendly amendment that the motion be we accept yes the underlying report.

Is that acceptable?

Yes, okay.

And the seconder okay.

Got it.

And just to be clear, what comes to rules next week will be the workload analysis.

Maria?

No.

No.

The item to then refer it to.

It's referred to rules for rules to uh to request a workload analysis.

I think technically rules would still need to have a majority vote to direct that staff forward.

Yeah, okay.

Okay, thank you.

But that is the intent of the referral.

Okay.

I think everybody's clear on the motion.

Tony, do we have any public comment on this?

I have no um cards for consent calendar.

For 2.11 only.

None for that.

Great.

All right.

Um, since that's a very particular motion, why don't we vote on that?

Motion passes unanimously.

Okay, great.

Thank you, Councilmember Ortiz, for bringing that forward.

We also had Councilmember Kamei poll item 2.16.

Councilmember Kamei, go ahead.

Thank you very much.

Um I want to thank Vice Mayor Foley and Councilmember Cohen for bringing forth uh the update to uh the limits on gifts.

Uh I just wanted to add a friendly amendment that would uh maintain the $50 gift limit for registered lobbyists.

Um obviously lobbyists are a different category, and so I'm um would like to move my uh memo that I added, which uh uh would recommend the changes as um the memo from Vice Mayor Foley and Councilmember Cohen suggested in terms of bringing it up to 200 uh but maintain the $50 limit on gifts from registered lobbyists.

So I move that.

Okay, motion a second.

Do we have any other hands up?

I don't see any.

Councilmember Ortiz, your your mic's on, but you're not okay, great.

Uh Tony, let's vote on item two.

I'm sorry, do we have public comment on item two point six two?

I have no cards with this item.

Okay, let's vote.

I'm sorry.

I'm sorry, Nora wanted to add something.

I apologize.

Go ahead, Orn.

Should council uh choose to proceed that way, we will need to bring the ordinance back so for a first reading.

So I just want to make sure we'll make that change and bring it back.

Thank you.

Okay.

And then there'd be a second reading after that.

Yeah.

Okay.

All right.

Tony, let's vote.

Motion passes eight to two.

Give me a second.

I'm waiting for the display so I can announce who voted no.

It's not coming up though.

I don't know who voted no, but I have a the vote is eight to two.

I did for the record.

Okay.

As did I.

Okay.

Ortiz and mayhand voted no.

Thank you.

Thank you.

All right.

We're still on consent.

We have the remainder of the consent calendar.

Do we have a motion?

Motion to approve.

Any other screen is now changed to vote total.

There we go.

Okay, we have a motion, a second.

I don't see any other hands.

Tony, do we have any public comment on consent as a whole?

I have no cards.

Okay.

Great.

Let's vote.

I have one vote.

Sorry.

One vote didn't register, so I'm going to hit continue voting.

There we go.

There we go.

Motion passes unanimously.

Okay.

Thank you.

Right.

We're on to item 3.1, report of our city manager.

Thank you very much, Mayor and City Council.

I do have a 3.1 today.

Today I'd like to shine a light on one of our exceptional employees, Tara Watt Siresak, who is an electrical electrical traffic maintenance project supervisor.

So certainly a title with our transportation department.

So Tara Watt, would you please stand?

Thank you.

He's also joined by his supervisor Ron Harrison, electrical maintenance superintendent, and Jennifer Segwin, our transportation department's deputy director of infrastructure maintenance, and our transportation director, John Rista, who's a couple of rows back from them.

In March of this year, the Transportation Department's electrical maintenance team was challenged to keep up with the hundreds of street light outages caused by vandalism and copper wire theft, adding to the challenge two electrical maintenance supervisors retired.

Tarawatt was at tasked with taking over the street lights section in addition to his existing responsibilities, which included working with the public works department to activate new signals, installing new signal control cabinets, keeping our traffic signals current with the latest technology, and running the electrician training program for the department.

And yet he took on the street light maintenance program with focus and enthusiasm, working with colleagues in the information technology department to improve the tracking of customer requests and performance metrics.

Additionally, he developed a plan to effectively use contractors to fix a current backlog of over 1,000 interoperable street lights this fiscal year.

Colleagues call him irreplaceable.

His commitment to working collaborative with other city departments as exemplified by our one-team ethos, demonstrates his strong leadership and unwavering dedication to serving the public.

Thank you, Tarawat, for being a city of San Jose unsung hero and stepping up to bring light to the places thieves have left dark in our city.

We certainly appreciate you.

Thank you.

Let's give him a round of applause.

And that concludes my report.

Thank you, Jennifer.

Really appreciate you highlighting TerraWatt's awesome work in public service.

Thank you on behalf of the council and the whole city.

We appreciate it.

Okay, we will continue on then to item 3.3.

This is the procurement audit report, and I know we do have a staff uh presentation.

Good afternoon, City Council.

I'm Joe Royce City Auditor.

I'm here with Alison Paulie and Hoada Hyder from my office to present auto report procurement.

The city should review its risk strategy, performance measurement, and guidance to improve procurement process.

Also in the box, Maria Oberk from the Finance Department.

I'm going to turn it over to Allie to walk through the findings.

Hello, Alison Polly from the Office of the City Auditor.

I'm going to start with a short background.

As you all know, procurement is a critical city function for obtaining goods and services.

The finance department's purchasing division oversees many different types of procurements, with the exception of procurements for consulting services and public works projects.

While there have been some changes implemented in recent years, timeliness of procurements remains a concern citywide.

The objective of our audit was to assess the efficiency of the city's procurement processes for goods and services, excluding public works projects.

Oop, there's the background.

Our audit had three findings.

The first finding is that reassessing risk strategies in key areas could improve procurement timeliness.

Every procurement comes with risks.

Policies and oversight help protect the city from these risks, but a system that is too risk averse can lead to overly long and untimely procurements.

The city administration is responsible for balancing the risks of procurement with the business needs of departments.

Forty-five percent of surveyed city fiscal officers and contract managers reported that their procurements were not completed in time to meet their department's business needs.

For example, purchasing's expectation is that requests for proposals or RFPs take six to nine months to complete.

However, three-quarters of RFPs handled by purchasing between 2019 and 2024 took longer than that.

Nearly half took more than one year.

Across all procurement types, RFPs as well as the others, the administration should review five key areas to examine and reassess whether the current policies align with its desired risk strategy.

Staff have raised concerns that the requirements in these areas have impacted the timeliness of procurements.

For any of these, changing requirements or allowing more flexibility could speed up procurements, but it would also expose the city to more risk.

The first adjustment is to raise the competitive procurement threshold, which would eliminate the need for small procurements to go through a competitive process at all.

In addition, waiving certain insurance based on contract risk and creating an expedited approval process for small dollar software subscriptions would streamline the negotiation process.

Delegating more authority to department heads to handle low-risk contracts would free up time for finance to focus on more complex procurements.

And lastly, reexamining the standard terms and conditions will ensure that they're in line with what the city administration wants to require during negotiations.

There are also two processes that we recommend should be defined and documented.

The first is for pilot program procurements.

Procedures are not well defined and can present challenges for approval.

The second is the escalation process for management review of contracts that are stalled during negotiations, which can be informal and lengthy.

Our second finding was that better tracking of strategic procurements would help measure progress and performance.

We found that purchasing's current tool for tracking strategic procurements does not consistently capture key milestones.

This limits insight into project timelines and also areas for improvement.

We also noted that there are no formal performance measures for strategic procurements, primarily for RFPs.

Tracking milestones and reporting on performance measures can help finance identify how long each part of the procurement process takes.

This would allow for targeted training and identification of where more guidance is needed.

Other jurisdictions use dashboards, cycle time metrics, and workload tracking to manage procurements.

To strengthen procurement operations and improve oversight, finance should implement a workflow system to track procurement progress and develop performance measures for strategic procurement cycle times.

Our third finding was that purchasing should consolidate and update procurement guidance for departments.

Procurement related resources for city staff are spread out across over 100 separate links and documents.

This leaves city staff without an easy, simple to navigate reference for policies and procedures.

More than half of city staff surveyed said they needed more guidance.

In particular, scope development has been a persistent challenge for departments.

Purchasing staff report that the quality of scopes sent into purchasing directly impacts how much time the procurement will take.

To improve support to city departments, finance should develop a consolidated procurement handbook, guidance, and templates for scope development.

Lastly, the city policy manual is outdated in some procurement sections.

We recommend that finance review and update the city policy manual to align with current procurement practices.

Overall, our audit had eight recommendations.

That concludes our presentation, and we ask that you accept the report.

We'll turn it over to Maria Oberg for the administration's response, and then we're available to answer any questions.

Mr.

Mayor, members of the council, city manager staff, and members of the public.

I am Maria Oberg.

I'm the director of finance.

I want to start by thanking Allie, Joe, and Uwad and their team for a very professionally run audit.

It was a pure joy to work through them.

They heard us, they heard the stakeholders, and yes, we are all in agreement.

Um we hear everyone's frustration, we share in that frustration.

I also want to thank my procurement team as well as the city manager's office and the city attorney's office for helping us work through the responses to the audit and helping us in the upcoming implementation.

We know we have things to do, and we are committed to implementing all of these recommendations in the coming fiscal year.

Great.

Thanks for the response, Maria and thank you to the audit team.

Nice presentation, Alison.

Appreciate it.

Uh why don't we go to public comment first?

I have no cards for this item.

Okay.

Then coming back to the council.

See if we have hands, we'll go to council member commit.

Thank you so much.

I want to thank the audit team and Joe for always having a very thorough uh audit and uh and always being available for my many, many questions, uh, even though this went through PISPIS and all of that.

So I want to appreciate that.

I want to appreciate the finance department for working collaboratively.

Uh we know we got a ways to go, but uh the fact that you agree with uh with the recommendations is terrific.

So I would uh uh go ahead and and move staff recommendation and acceptance of the report.

And I want to say, you know, that we are getting better together, and uh it is uh gonna take a little time, but uh hopefully we'll get to a better place.

So thank you.

Thank you.

Yeah, we've been a little slow with the seconds today, but appreciate that.

Um just one question.

So the the audit, what I love about it is it's very concrete and actionable, and it seems to accord very much with where the administration wants to go, and so that's all good.

I am curious, often these audits are narrow enough to be concrete and practical and to not take a tremendous amount of resources.

But how much time did the audit team spend thinking outside the box about innovation potential, the opportunity to bring in new tools like AI or or just very radically different workflows or maybe advocate through IGR for changes to state law?

I'm just curious if we got outside the box of improving the current processes.

Obviously, some of the software uh tools will help us do that, but I'm just curious uh on scope, how much you think about.

What if we just did this very differently?

Thanks for the question.

So that is we did look at it from the beginning, looking at it.

You know, what does it look like from beginning to end?

We talk with folks.

Um, the purchasing folks were looking at AI from scope development.

We noted that we didn't we didn't have a specific recommendation in that area.

Scope development uh is one of the biggest challenges, and that's an area where innovation and AI could be really helpful.

We didn't, they were already kind of exploring that, so we didn't really go we didn't say you know, recommend you know, continue exploring your AI pilot ideas.

So that was one we we we did look at that area.

Some of the things that when talking with staff, there were some some very specific areas that really were log jams.

One of them was in scope development, as I mentioned.

The other one was in the negotiation process, so that was where again you might need to read between the lines, but rethinking those standard terms and conditions or you know, delegating authority down, these are pretty different, pretty drastic changes to the what what has historically been the case for we're not necessarily, for example, delegation of authority, not necessarily saying weaken your controls, it's really just a matter of accountability in terms of putting it more accountable onto the department heads to shoulder the the that accountability for some of these pieces, and then going further with what you're kind of going, you know, just looking at it completely differently.

We did really take a hard look at how other folks are looking at things, and uh to be completely honest, a lot of the controls in place are in place for a very good reason, so we're spending somebody else's money.

Uh we we really are need to be looking at best value for the for the residents of the community who are actually for paying this.

So trying to balance that risk of spending some other people's money, but how do we meet those needs in a timely manner?

And it was really where we were focused our attention and and scrapping it, starting it over completely from the beginning.

We started looking at some areas there, but we decided, you know, what we're gonna look at these five really risk risk areas, which seem to be h holding things up in different areas, and then we really wanted to focus a bit more on that scope development and training because ultimately department staff are the ones who are procuring this information.

They're the ones who are defining the need, they're the ones that put it that are understanding the operational need, and so that was kind of the way we looked at it.

Um so we didn't, you know, pull it out by the roots and and say start over, but we really tried to focus on those things that really popped up to us based on our conversations with fiscal staff across the city in conversations with other jurisdictions and how they're trying to address these things.

Um and then some of it's just an evolving uh process.

For example, the software subscriptions, no one seems to have a really good handle on that yet.

So we need to kind of really really really rethink that.

Uh San Francisco and Santa Clara County have some ideas.

Uh the attorney's office uh cautioned us in that regard that some of their ideas have not been tested in court yet, so uh there's there's some challenges there.

So hopefully that's helpful in kind of our approach to looking at the process.

Yeah, it's good context.

I appreciate it.

Um I don't know if this question's for you or maybe more appropriately for Maria.

If if fully implemented this set, if you fully implement this set of recommendations, do we have a sense of I know there's probably no such thing as the average procurement, but is there any way of quantifying potential time savings?

I I think what I'm what I'm getting at is whether it's through training, process improvements, use of technology, whatever levers we have, I would argue that both for permitting, I'm sorry, procurement and permitting, two of our longest, most complicated processes were absolutely we need to be transparent, we need accountability, we have to adhere to the law, which is pretty complicated and best value.

I mean, all these principles, of course, have to be protected, and yet the thing that isn't working in today's world is really the time issue, is that we're not our cycles often are just not fast enough to meet the needs of a faster world with a lot of rapid change, and I I think that's what I'm trying to get at is how do we shorten the cycles.

And I'm just curious, do we know how much this actually is likely to save time?

Or is it just gonna be a clearer, smoother process for everyone?

I think it's gonna be a clearer, smoother process for everyone.

Uh no, I don't know that's good.

I don't think we would see anything that would rise to the level of RFP.

I don't know that we would see a dramatic decrease because they tend to be the most complicated ones.

And each one is, of course, unique and meets with unique circumstances.

Where you would see it is we would have fewer RFPs that would meet that, you know, that threshold if we were, for example, to increase the thresholds, what constitutes an RFP or what the departments can handle internally, however, we decentralize it.

You would see fewer items of purchasing go to that RFP level.

So I think overall it would probably speed it up, but it's hard to really quantify.

Right.

So those could be areas for further exploration.

Yeah, I would like to add a couple things.

So some examples might be helpful.

So again, the two areas where we really kind of identified where there's some log jams were the scope development and negotiations at the end.

Now, I'll give you an example when one on the scope development, there was one that Hallie just pointed out, reminded me earlier, there was uh uh an incomplete scope made into purchasing from a department.

Purchasing sent it back with some ideas.

It sat with departments for six months before, and I'm not sure exactly what happened there.

So that's six months right now in scope development where that with better tools, better uh better uh guidance around scope development could have been shortened.

Negotiations, we have a couple of examples where negotiations went on for quite a bit of time before it was ever elevated to uh the city manager's office or to council to waive certain terms of conditions.

And this is like I said, uh eight, you know, 12 months that a procurement.

So these are just some examples of where some uh streamlined processes, uh, a reassessment of what are the risks uh risks is where there's a you know an escalation process that makes sense so we can get things expedited to to you all or the city manager's office to to step in.

So those are some examples of where time savings can be had.

Yeah.

That's great.

I appreciate it.

And look, I'll just say for myself, I'm not asking to add this to the motion, but I just think as this comes back to our council committees as we continue these conversations about moving faster, being more efficient as a city.

I just hope we'll look for these opportunities.

It's not a monolithic set.

I mean, my best analogy is permitting where there are some reforms that the council has supported recently, such as ministerial expanding the scope of where ministerial approval is allowed, where we're literally shaving 50% of the time off of getting a permit.

Now we're still abiding by all the same laws, we're still doing community input, we're still you know, we're still doing all the things we want to do, protecting the values we care about, but we've managed to get to a yes 50% faster.

And I just I hope when it comes to procurement, which for me is much more of a black box, frankly.

I don't know nearly as much about it, but I hope we're looking for those opportunities, even just in certain categories where we can just move faster without putting fundamental values at risk.

I know that's a little beyond the scope of this audit, but I just thought I'd take since we don't talk about procurement very often.

I thought I'd take the opportunity to make that point in a public forum.

Okay, uh appreciate the audit and everybody's time on this.

And uh with that, I don't see any other hands up.

Tony, do we uh did I ask for public comment already?

I think we did.

I have no cards on this item.

You don't have any cards, okay.

Apologies if I didn't earlier.

So then we're back to the council for a vote.

Sorry, I was expecting a discussion.

I think we just had it.

Thank you.

Okay.

That passed unanimously.

Uh, just a reminder item 3.4 was deferred.

We are on to item 4.1.

I believe we have a verbal report from Chief Sapian when he gets down here.

Um, good afternoon, Mayor and Council, Robert Sapian, fire chief.

In 2016, the city council adopted the fire department's strategic business plan and concurrently a comprehensive fire department organizational review.

The strategic business plan included within its sustainable workforce focus area the goal to actively recruit, train, and support a talented and diverse workforce.

Initial strategic steps towards achieving this goal included implementation of a new women's boot camp to introduce firefighting as a challenging and rewarding career opportunity available to everyone in the community, enhanced employee health and safety programs with focus on cancer prevention and behavioral health.

Assembled a recruit firefighter recruitment stakeholder group to guide upcoming firefighter recruitments, conducted a fire ops 101 event to broaden city leaders and influences, influencers' understanding of fire services, achieved measured employee engagement improvements, initiated recurring employee recognition events, and established a video and multimedia resources to expand the department's reach through social media.

Subsequently, in 2020, the Santa Clara County Civil Grand Jury released its report titled Why Aren't There More Female Firefighters in Santa Clara County, which offered findings and recommendations related to recruitment and working conditions to agencies in Santa Clara County, including the Santa Clara County Central Fire Protection District, the City of Mountain View, the City of Palo Alto, and the City of San Jose.

Six report recommendations offered to the City of San Jose were related to recruitment efforts, mentoring, advancement opportunities, accommodations, or fire station living conditions, gender inclusive work culture, and uniforms and personal protective equipment.

Building on its strategic plan goals and adding accepted recommendations from the civil grand jury report, and later adopted racial equity action plan objectives, the department has continued to make progress in expanding its recruitment efforts, offering open door mentoring availability, offering career development courses and trainings, modernizing improving and improving fire station conditions, pursuing fit options for uniforms and protective gear, and reinforcing the department's values that, in my view, are the underpinning of this great fire department.

In the area of recruitment, the department continues to support initiatives like the women's boot camp, creating video series such as Path to Service that inspires interest from throughout the community, increased and robust outreach through multiple channels, including more in-person engagement with firefighters, establishing a racial equity action plan recruitment and outreach committee to mobilize intentional efforts to build awareness and reduce barriers to entry, including more and including more employees in key steps of the recruitment process.

In the area of mentoring, employees may participate in the citywide mentorship program, and each department senior staff member offers appointments upon request where employees can ask questions and or engage in dialogue and receive guidance on career development and advancement.

In the area of advancement itself, the department primarily through its state-of-the-art training facility maintains its status as an accredited local academy to provide career development training courses.

Many of the state fire marshal certification courses that are offered help employees meet minimum qualifications for promotion.

Additionally, employees are provided with all information necessary to navigate the promotional testing process towards placement on eligibility lists.

In the area of fire station conditions, the fire department continues toward a new baseline for privacy accommodations in all fire stations through the installation of semi-permanent walls which define individual sleeping areas.

Additionally, the department continues to evaluate fire station privacy policies to identify opportunities for improvement.

Uniform and protective gear.

The department endeavors to provide uniform and personal protective equipment that performs effectively and meets employee fit needs.

Where offered by vendors, gear is custom fitted to the employee.

The department solicits employee feedback on an ongoing basis to understand opportunities for continued improvement.

In the area of gender inclusive work culture, the department welcomes opportunity for third-party review of department gender inclusivity and workplace culture, and will receive recommendations in good faith toward continued refinement of our values, which includes the value of continuous improvement.

With that, I am happy to respond to any questions.

Thank you, Chief.

Appreciate it.

Tony, do we have public comment?

I have no cards for this item.

Okay.

Thank you.

I'll just say, Chief, I appreciate the report and the work your team's done since the 2020 grand jury report, as you mentioned, the women's boot camp, which has expanded to high school participants and now reached up to uh 100 women interested in first responder careers.

I think is really exciting.

Flexible scheduling to allow people to request a 24-hour shift instead of the standard 48 to help better balance family and caregiver needs, and then the work we're doing around retrofitting the stations, all really important outcomes from that report.

I do think that uh recruitment and retention of women in the department continues to be an area where we need to do better.

Uh I think we of the large departments I've seen, at least in California, have one of the lower percentages of female firefighters.

One thing I just wanted to highlight uh drawing on finding three, was um, you know, I really think we get many of our best ideas from the folks on the front lines who are uh, you know, I've recently joined our departments or doing the frontline work, and um I the language was a little vague to me.

It said sort of like department employees can provide input on ideas for how we improve recruitment and attract a more diverse pool of applicants.

And I wanted to ask if you've thought about how to solicit it in a more structured, ongoing way.

Because I don't think it's enough to say, because everybody's busy and people are shy, and there are all kinds of barriers.

You know, if we really want to draw out the best ideas from our employees, particularly women in the department who frankly probably have the best insights on how we might attract and retain more women to be firefighters.

Is there a mechanism you have for that?

I mean, how how will you ensure that we actually get those ideas?

Thank you, Mayor.

Um, yeah, and that that effort is already afoot uh uh in a formal way uh by way of our uh racial equity action plan committee.

Uh they are preparing a survey for the field to gather just that that uh type of information.

Um and the wording in the memo was a little bit loose because information is accepted very freely in the organization.

Anyone at any time can provide feedback and we capture it.

Uh but in terms of a formal quantifiable results method, we do have a survey uh in progress as well.

Okay.

One just recommendation.

I don't know if this is part of your practice, but one thing I've learned with surveys is that there's value and it builds trust and reporting back out a synthesis of what is learned.

Is that something you will do?

Yeah, generally when we do a department-wide survey like that, we do do the feedback loop of you know saying what the survey is heard.

Yeah, yeah.

Okay, I appreciate that.

Okay, that's good.

Thank you.

Um, let me turn to colleagues.

Let's start with former firefighter.

Councilman Duan.

Thank you, Mayor.

Thank you, Chief, for uh the report.

I just got a couple of questions.

Um, on the recommendation number three, has our fire department created a committee to address some of these issues, particularly in the women.

Uh the answer to that is is yes in a couple of iterations.

The the most permanent uh right now is uh within the Bureau of Administrative Services, which is uh where our HR unit uh exists, uh and that is that uh racial extra equity action plan committee that is that is uh narrowly focused on uh these issues that are that are contained in this memo.

Thank you.

And then on recommendation number four, it's um it stated that uh you know it had been five years since the first civil grand jury report, and there are still many station that is still considered dorm dormitory, and some of these cubicle divider, if you will, is really low, whereas a tall firefighter can walk by, can look down on onto the privacy of a female firefighter.

I wonder, do you have a plan of retrofitting a lot of these older stations for their privacy?

Uh yes, that effort is in progress now, um, and the the new baseline standard um as you are aware uh essentially the department had scrambled to to obtain what were just old office dividers, which were uh I I believe five feet or less in in height, not not suitable.

Um and uh we have uh at this time adopted a baseline standard of a semi-permanent wall, so a framed wall that is uh you you can create blind around the entire sleeping area, um has to meet code.

Of course, we can't interfere with sprinkler function and that sort of thing, but uh it is the the maximum uh divider that we can place in those living areas.

And do we have a a particular um spreadsheet to say particular station at a at a particular time where we can accomplish this?

Uh we're steadily making progress.

Uh well uh on our way to um to getting to completion.

I think it's it it could be about a year or two before we get it done.

We do have uh two stations or one station, excuse me, that is going to be replaced, so that knocks one off, but uh I think we're we're getting closer and closer to finishing up.

All right, thank you, and um thank you for um the good work that uh our department is uh taking care of our citizen.

And count a council murderwan, in the response from the fire chief, he put a uh a table on page eight.

You can also have that for your records of where we are and what the sleeping quarters look like, because uh we've been building this into our capital improvement program over the years, and we again I think we're down to these kind of last two that we're working on, so appreciate the question.

Thank you.

Thank you.

Thanks, Jennifer.

Thank you, Councilmember.

Let's go to council member campus.

Thank you, Mayor, and thank you, Chief, for the information for um, you know, bring bringing this item to us.

I think the findings are um uh they're they're right in line with what I've been hearing from um our fire uh departments and when I did a tour of our fire station in South San Jose um I looked at the wall of years past firefighters, and you know, I asked the question why don't I see women um on these pictures?

And so this report really aligns with what I heard um from firefighters in the field in San Jose about what changes are needed to really help um make the firefighter profession in San Jose a desirable one for women.

Um and so uh just a couple of questions um to follow up on on the findings.

Are you familiar with the term invisible load that women carry?

Um I would not call myself an expert, but I'm familiar with the term, yeah.

Okay.

So for those of you who are not, the invisible load is essentially um a lot of the responsibilities that are put on the shoulders of women as it relates to household duties, whether it's child rearing, cooking, cleaning, you name it, it.

It has to get done.

Somebody's gonna do it, and many times it's women.

And so when we're thinking about women and their careers and how we are making it feasible for women to step up into these professions, um I'm curious about how something like that is incorporated into this audit, these findings, or I'm sorry, not the audit, the civil grand jury report, but the recommendations and the findings.

How are we thinking about that in this context?

Thank you, Councilmember.

Yes, not directly uh related uh or not clearly identified in the recommendations uh or in the response.

However, uh we have implemented some changes uh in the most recent negotiations with the International Association of Firefighters, for example.

Uh we did uh implement uh a schedule option, for example, for someone who maybe is taking care of a child and can't be away from home for more than 24 hours at a time, and so we now have uh we now offer the option to sort of self-select a schedule so that the individual can put in their hours, but they don't have to be away for uh extended periods of time.

Uh also uh we do uh manage case by case um exceptions to mandatory overtime, for example.

So if someone has a need at home that that really precludes them from being able to be mandatorily ordered to work 24 hours after 24 hours, that that's also uh programmed into our processes now.

Um we do have uh in the works, I think uh with with a lot of feedback from employees, um, really explicit um direction on existing policies in the city, but also um some opportunities to support lactation and that sort of thing to to make sure that that we are taking care of the whole person and and all of their needs.

Thank you for that.

Um I know that um the women who graduate from the academy are already limited in numbers, and then the next hurdle that we have is the many departments across the county and across the region who are also trying to get their diversity up and um are really um you know that's who we're competing against in terms of uh top talent, and so where other cities are maybe able to provide higher starting bonuses.

Um I I think flexible scheduling is a great place to start, but to me it feels like you know the bare minimum that we can be doing because we do have to compete with other cities, and so I know it's not just our fire department, it's many departments across the city where we could be doing a better job of making sure that we're not just providing opportunities for women to enter the workforce but remain and advance in their career and their profession.

Um, and so it's it's no surprise that again I I'm going to make the pitch that we need to consider how we can um think about child care and think about the strong retention and recruitment tool that it is that is innovative because not a lot of cities are talking about how they can include child care as a benefit to make sure that we are truly providing an opportunity for women to not just participate in the workforce but remain in the workforce.

Um I think that this findings are are critical places to you know continue to to look at the floor of what we're doing and think about how we can improve and elevate because this has been an issue for some time.

And until we really think about truly innovative ways to advance and bolster this profession for women, um it's gonna be hard to compete against those other cities that have more financial resources to do so.

So a lot of opportunity for us to think creatively about the workforce of today and the workforce of tomorrow, because of course we know that when young children have access to quality early care and education, we are preparing our workforce for tomorrow.

So thank you again for the presentation or for the information.

And Councilmember Duan, did you make the motion to approve?

No, yeah.

So a move for exceptance.

Second.

Thank you.

Thank you, Councilmember.

All right, great.

We've got a motion, a second.

Let me go to Councilor Kame next.

Uh thank you so much for the responses.

You know, I was looking at your chart on page seven, and I I noticed that in 2024 and 2025, you had a tremendous amount of applications, which then led to a really big increase in the number of uh female applicants.

And obviously, if you have a bigger pool, you have more.

Uh you're at least as you uh go down the line, the chances of you recruiting and having someone uh join the department are greater.

What happened in 2425 that uh did not happen in uh 2526?

Is it because we're only halfway there this year?

Uh yes, we have one um recruitment in play right now.

Why the number dropped, I could not tell you other than that the frequency of recruitments has been increased a little bit.

Um I don't have a solid um recommendation on uh or uh uh explanation for why the the number dropped this cycle.

Yeah, I just I just thought that perhaps it was because we're only sort of like not fully into 25 26, uh that we still have the rest of the it represents just one recruitment um and other years did have some overlap, so there's some of that, and then that year that that is very low was a very limited recruitment of just paramedics only, so that that's why that one is that way.

I see, I see because I think that um it it uh um hopefully by the time we see that full 25-26 year it'll be a bigger number.

Is that correct?

Um well we we do we will likely initiate our next recruitment within the fiscal year, so I think that's probably a good a good hope.

Yeah.

Well, you know, I I know that a lot more has been done, and uh I want to thank you for that.

And I know there's still yet more to go, uh, but at least we're going in that direction, and and this is something that you know I uh I have been looking at, and you know, I definitely have attended the boot camp.

Uh I I have not been able to participate, but you know, I know that it is very popular, and each time there are more and more uh women who are interested in this, so it is a very challenging uh uh profession, and and I know that uh that it is uh it is it is um uh quite a a big a big hurdle.

Um I I was just wondering, I know it took a little while to be able to get the uh consultant matrix consulting group on board, and I'm just wondering uh they helped with the development of the strategic plan, but I'm wondering is there going to be more uh down the line?

Are they doing more to assist the department in terms of looking at uh uh other ways that can be um that we can you know sort of explore better uh recruitment and retention?

There is a second study that we're we're hoping uh comes through quickly, which is uh a uh closer look at uh department culture um to uh understand living conditions in the department and culture and to maybe get down to some of those um those finer issues that that maybe we don't quite have a sense of in terms of of what might be keeping people out of the workforce.

Is that coming by the end of this year or is that you know, that's being administered by I believe the department of employee relations, and so I think they're on their time, their own timeline.

I'm not sure what it is yet.

I do believe it's this year, yeah.

We're having that run out of the city manager's office just to just to keep it close here and not have any conflict uh with the fire, so we're keeping that that little bit of a oh that's right.

I forgot a little bit of a wall up there, but um, yeah, so we're looking forward to it.

Just took a long time to execute that contract because we initially didn't get bidders, but we we got that all executed, I believe, in June.

And we're I think they're they're uh starting to work.

So um hopefully uh we will we should have something this year, that's our time frame because we need that all the information to improve our recruitment and retention as soon as possible.

But we want it to uh be um, you know, in-depth enough to have some actionable uh things that we can take to actually make a difference.

Excellent.

Excellent.

Well will that come to PISFIS then or will it come to council?

Oh, I think that will come to the administration.

It's not it's not scheduled to go to council, but any findings out of that that we may want to implement, we may need to bring some ideas through the budget process.

We can also brief you on it separately, but it's not something that it's it's more for internal operational consideration, but um we can certainly uh keep you up to speed as we get findings on that.

Excellent.

Excellent.

Thank you so much.

And then my my last question is um uh in response to recommendation five.

The department refers to department wide training conducted uh last year.

And I'm just wondering, do you will you be doing like refreshers on an annual basis?

We the intent is to uh refresh the professional standards training.

Um I don't know, I don't have a plan exactly for how we're gonna deliver it, whether it will be in the form of of how we generally deliver refreshers or or whether we'll want to do more in-person direct um training, but it it will happen either way.

I just haven't determined uh exactly how it's and that's gonna be uh on an annual basis.

Annualized, yeah.

Okay.

Thank you very much.

And thank you for your work.

Thank you.

Great thanks to my colleagues for all of their questions and comments.

We have a motion on the floor, Tony.

Let's vote.

Are you seeing it?

Yeah, I'm starting to get votes.

It said timed out, so I wasn't sure if it popped up for you guys.

Is everyone present voted, Tony?

Um, I can't.

I'm gonna hit end vote because I can't see it until I hit end.

I just see the numbers.

Um, so Cohen is marked as absent.

So I have nine to nine zero with Cohen absent.

Okay, uh Councilman Cohen stepped back.

He may want to try to add his vote there.

He may have thought he did before he left.

Um, yeah, there was it definitely had an issue.

Some kind of lag, yeah.

Okay.

Uh we are gonna be moving on though.

We are on to item 5.1.

This is the fourth amendment to the funding agreement with Santa Clara Valley Transportation Authority for US 101's anchor road project.

There's no staff presentation.

Do we have public comment?

Yes, for item five point one, I have a man Gormley and Jordan Maldau.

Come on down.

Heyman Gormley, San Jose resident, district three.

I'm calling on the city council to reject this recommendation.

This is a fundamentally flawed proposal.

This bridge is nine lanes wide at its widest point.

Why does it need to be so wide?

Either this is a preparation to use it as a third runway for San Jose Airport, or there's a future plan to widen Zenker even more.

This is Caltrans clinging to the long ago debunked idea that more roads mean less traffic, and if it were true, it would mean LA would be the least congested city in the world instead of being consistently the most congested.

This design is absolutely preposterous.

It's got a few bike lanes nailed on to the side just to greenwash it.

But any bicyclist or any pedestrian who ventures into that area after this is approved or after it's built, will be taking their lives on their hands.

If you can't vote no on this proceedings, I recommend at least deferring your vote until you've had more time to study this proposal and just see for yourself how bad it is.

Opposition to this proposal is growing.

We sent a lot of feedback to the uh at the early stages of the proposal, but they seem to have been disregarded.

Please vote against this proposal, Jordan Moldow, District 3.

So this is the rendering of the interchange that you're voting on today.

As Immin said, it's a nine-lane interchange.

It's gonna cost over 350 million dollars to construct this.

This is the overhead rendering of the interchange.

Um the colors represent different types of bike lanes.

Honestly, the stuff south of the highway, it's pretty decent infrastructure.

I think the bike lanes should be wider.

I think they're sort of minimum width and they should be wider, but it's okay.

But north of the highway, uh, this project is pretty gnarly, it is not hospitable to cyclists or pedestrians at all.

You're gonna have to cross an interchange ramp here at grade with no intersection protections, and then one here, and there isn't even any bike lanes along this road.

It doesn't show in the full rendering, but we're acquiring about a hundred million dollars worth of land to build this project.

We're widening bearing to six lanes, it's currently four, and we're not even building bike lanes on all that extra land that we're acquiring.

This is vehicle miles traveled in the city of San Jose.

It's supposed to go down.

You can see it's going up.

The staff report says that VMT will decrease for this project, but that calculation was done with the induced demand of this project already baked in.

So our EIR for the general plan says that projects like this are gonna increase the per capita VMT over time.

Um, some of the bad things in this design might be baked in if this moves out of environmental.

So I'm asking for it to stay in environmental for now and go through BPAC so we can make changes before it's too late.

Thank you.

Back to council.

Thank you for the public comment.

The mayor had to step out, so I will move on to comments from my colleagues, Council Member Campos.

Thank you, Vice Mayor.

I um do have some questions for staff, so thank you, John, for making your way down.

Um I know that in District 2 we recently had um an interchange project along Blossom Hill and the 101 interchange.

And you know, even though South San Jose is a uh pretty car-centered um uh, you know, suburb.

Um we did a really good job of ensuring pedestrian and bike safety on that project.

So can we please get a little bit more information about the design process for this project and if there's a reason why the bicycle facilities or amenities are not more robust?

Thank you, Councilmember John Russo, Director of Transportation.

Yes, the project you're talking about one-on-one Blossom Hill was uh one of one sponsored by the city to improve that interchange and actually did do quite a bit of improvement for pedestrian bike by building its own flyover structure to uh separate bike and ped travel from the roadway.

Uh so that was actually won a number of awards, so it's a very good project.

In this project, what council's voting on is the next step of this one-on-one Zanker project, which it just completed environmental, so environmental phase is done.

That was about three years worth of work for that.

This would move it into a final design phase.

So we're uh what's in front of the council is the uh contribution from the city to VTA, who's a lead project on uh lead agency project to sponsor for this to continue into final design.

So this I'll try to summarize how complicated this project is and what the difference is between 101 Blossom Hill, which is a pretty simple just overcrossing.

This is a pretty complicated project that accomplishes a number of pretty important things.

One of them, this is actually um included in the North San Jose environmental uh project that was done, I don't know, some 20 plus years ago that established North San Jose development of some 32,000 housing units and 25 million square feet of office and commercial.

So, in that in full environmental approval, the council did way back then, and it identified a number of transportation projects were needed to support that much development.

Pretty significant amount of development.

This is one of those projects, another one we just completed, which was one-on-one uh Trimble de la Cruz, which was another project on one-on-one there.

So this this project is actually called out in that plan as one of those supporting infrastructure to support all that development.

This one is different than um Blossom Hill 101 because this is actually doing a number of really important things.

One of them is building a brand new connection from uh San Jose into North San Jose on Fourth Street Sankor.

It makes a new connection to the airport.

So Skyport gets uh extended to this interchange.

So there's a new connection to the airport off of 101.

It uh provides for a whole bunch of fixes of really substandard on and off ramps in that area along excuse me, 101 that's uh just west of the 880 interchange, so it cleans up a whole bunch of mainline and on and off ramps, which then makes it very complicated.

We looked at the ability of whether or not we could actually build a separate similar to 101 Blossom Hill, a separate structure, and it just wouldn't work because it would have cut off that uh bike pet access to all those other roads that are in the area that we're trying to make whole on both sides of 101 there.

So it's very much more complicated to be able to do that.

Um it is a very big and complicated and expensive project for sure.

What also was in the environmental document that was supporting that 32,000 housing units was Zanker Road was anticipated in that plan to be six lanes.

So when we did the environmental for this project, we had to use that as a baseline.

That was the environmental document for the North San Jose plan, so we had to use that same thing.

We're now in process of trying to redo that transportation plan for North San Jose.

I would uh probably guess that we're gonna when we return to council uh when we're completing with that that plan for North San Jose that we're probably gonna recommend that it not be six lanes, but we had to design and environmentally clear this project as a six-lanes anchor project because of that environmental document.

We have fully intend to actually go back now that we'll get into final design and see if we can refine that, and hopefully, if the when we bring forward the transportation plan for North San Jose, if it brings anchor down to a four-lane facility, that we would try to revise and refine our design.

There is really good and safe uh pedestrian and bike uh facilities that we're building into this, even though it is a fairly large project.

We're actually building in uh 17-foot bike lane pedestrian protected bike system across the the structure there.

It'll be raised up level with the sidewalk, so it'll have two-way bike, two-way ped, and a protected hard protected edge against the traffic.

So it's actually a very safe functional facility that we're building for PEDs and bikes there.

But right now we couldn't we couldn't find a design that would work that would have a separate one and still be functional.

I hope that answered probably went too far, but that was that's why this is so complicated, it goes all the way back 20 years ago when North San Jose first came through as a huge development for the city.

That was a great answer.

I know that it's projects like this are years if not decades in the making.

So thank you for for that robust uh information.

And so you mentioned that there is still a final design where there's opportunity to refine uh before then, and so has this project been reviewed by um our city's VPAC, the bicycle pedestrian advisory committee.

I yeah, I believe so.

It's it went through about three years of environmental with many different meetings, and we always bring these kind of projects through the BPAC.

So it's had that review already, and again, it is the environmental is complete on this, and now we're moving into design.

Well, I think we just heard from some BPAC members' concerns.

So is is there an opportunity for BPAC to hear it one more time before it goes to final design?

I think probably when when we actually get started with the design with BTA.

BTA is the lead agency on this, so they would be more than happy to come back when we start to think about um how that could be refined.

We also want to complete the North San Jose new transportation plan, which would then give us that guidance of what Zanker would look like.

Right now, the environmental document says it's six lanes.

If that changes and the council approves that new plan, maybe that can change too.

Okay.

Well, thank you for those responses.

Thank you.

Councilmember Collin.

Yeah, thanks.

First, I'm going to start by saying I pushed a yes vote on the last item and then walked out, and I guess it didn't register, so I voted yes on item 4.2.

Thank you.

Um and thanks, John, for the overview of what is a very complicated project.

There are three key interchange projects in North San Jose that have been anticipated as part of all the growth in North San Jose.

101 Trimble was the first in an amazing project with uh the best, I I think the best bike separated bike lane in the city.

Um, one six awards, one a whole bunch of awards, yes.

The the eight eighty Montague project to me is r is really important as well, and the plan there is to have this a similar kind of separated bike lane.

Many of those traditional interchange connectivity could uh connections have the room and have the space to be able to do this kind of work.

101 Zanker is the third route, and for those of you who aren't familiar with with this, if you drive down Zanker Road from south of Brokaw, it kind of aims to the highway and then veers off to the side because I guess it's been a long time, it's been anticipated that it would eventually connect across to 4th Street.

If you come up from downtown on 4th Street, you hit 101 and then you have to kind of jog around and go to Brokaw.

There's a lot of, in my opinion, unsafe driving merges and all kinds of things happening as a result of those jogs, plus a lot of unsafe biking.

For example, on old Bay Shore with that interesting on-ramp onto 101 where you can't really come down Bay Shore, cars are coming left to get onto 101, that will go away.

A lot of these other unsafe interchanges will go away as part of this project.

Getting that connection directly across 101, while it it'll be it because of land constraints, isn't ideal in terms of being able to create that separated bike lane we're used to on other interchanges, will also do a lot to change and improve the area around it.

But I so I I just think it's important to understand this is a this is a much more complicated thing because of all the different on and off ramps.

If you come up to Broca and you get off at BroCon now, some of those ramps will go away.

Um new ramps will be created, um, the connection to the airport will be more direct off of 101.

Um, there will be, you know, a number of things, but it is complicated and it's not ideal.

When I saw the design early too, I was like, this is kind of wonky, but it's it's due to a lot of constraints that we have on this area.

But in order to get that last connection in from San Jose to um North San Jose, I I do believe it's an important piece of the overall plan in North San Jose.

It may even be an obligation of the city through the um all the settlements we have with the county about how we get traffic in and out of North San Jose.

Um, and so I'm you know I we have to move forward.

What I heard from you, John, just from I was gonna ask the clarifying question.

This is not the final design.

We're at a stage where more design work, more input will occur.

Yeah, thanks, Councilmember.

Um, we're very aware that this is a project that's it big and complicated, and the design needed to follow what was already on the books, the six-lane Zanker Road.

We actually debated that but determined that we had to abide by that baseline until that was going to be changed.

We're as you know, we are in process of revising all the transportation considerations up in North San Jose, and uh likely we may come to a different conclusion when we bring that back to council.

It's likely could be a four-lane Zanker, which then will give us some flexibility to rethink some of the size of the interchange.

And we don't want to overbuild anything either.

We really want to make all of our facilities very, very head bike friendly.

I you've seen us do that before.

This is just a really tough one.

And I imagine this will improve the ability to bike on old Bay Shore and on Brookhoff.

It's gonna make a number of improvements.

Everything you see in the that illustration that was shown is upgrading all of the bike facility within the scope and footprint of this project.

This project has a much bigger scope and footprint than just anchor and and fourth street.

Um, the timeline, of course, we all know those of us who've been doing these things for a while know that these things are years and years out.

I mean this is not we're not approving a design we're not starting construction we're approving money today to help continue the design process this is beyond 2030 for a completion date at this point right yes so uh I would expect it's probably gonna be at least a two year design maybe longer because it is so complicated and it may have to be phased and then it makes it even more complicated and I also should just mention I'm not sure that we that I said it before but the funding that the council would be approving is actually from that traffic impact fee that used to be in place in North San Jose that developers have already paid.

So they've already been paying a transportation impact fee for these projects so that's where this funds are coming from great okay so I'm gonna move approval of this uh funding agreement uh between the city and San Jose and uh VTA.

Sir a second second don't be shy council members uh so we have a motion and a second uh are you finished with your comments council member collin council member cometh um thank you for the information on this um I wanted to know in terms of timing uh why is it essential that we do this now if if is it to get the sort of the second iteration of the uh more design and input within that two year period or I'm just curious as to to if you think that we're gonna kind of shift from the sixth lane to the four lane why are we making the decision today to put in the 10 million this the decision before the council is actually to uh amend the agreement with VTA that's actually managing this project and our share of that work is the 10 million so that would be what we need to do for us to do anything we've got to move forward with VTA to design the project either as is or if there is a refinement that comes forward.

So the more you wait the more expensive these get yes I I understand that but I mean in terms of I'm just trying to understand uh sort of our action is needed today because it is important that what that we can move the project forward.

No but I mean if we want to do anything you got to move the project into design to actually do the design that's outlined there or any kind of refinements.

I guess I guess I see the money going first and not having the security that design will go to a uh four lane.

Well we don't know that yet yeah we don't know that yet first the but the money has to come first before the design.

VTA is moving for we're ready to move forward with this again remember they're the they're the agency that's leading it our share of that final design cost is that 10 million amending the contract allows them to start moving forward.

Okay so this is this is um uh let me explain my concern so um I I'm not familiar with uh the um the um the work that was done over at the 101 that um council member campus talked about I'm familiar with what happened at the crop at the at the crossing of 87 and 85 where a bicyclist has to go down in the sort of like in the middle of two highways and um you know sort of like risk their life to get on to the trail and then you get off capital expressway and then for capital expressway you have to cross all those lanes and then you have to fight the traffic going into um uh back into the the uh the trail right so I don't know um in terms of how you uh keep emphasis on uh better safety for cyclists but you know that design uh was terrible.

It is frightening to go across Capital expressway.

But that is the only way you can ride your bike more directly into San Jose.

And so, you know, I think that while, you know, the idea is, oh, yes, you know, it was six lanes because that's what we had previously da da da da um I you know, as this moves forward with the 10 million, I want some assurances that yes, in fact, we will have better design because you know it's um I understand that it's VTA that's working on it, and of course, I will make that known at VTA, but I also think that you know clarity going in and saying this was authorized by the city of San Jose, but this is what we're thinking, and this is what we'd like, and that sort of thing.

Thank you.

Um I think the area you might be referring to is down uh Capital Expressway 87.

Is that where it is?

And we've got a 85, it's right in the cross of 85 and 87.

You have cars that are going onto the ramp in either directions, and the entrance is right smack in the middle of that intersection.

Yeah, I think I'm familiar with that area, right.

There we don't have a project down there right now.

No, I understand that, but I'm I'm saying I'd like to avoid anything that would even have those types of things.

We try to design all of these projects to be as safe as overly safe as possible for ped bike, as you can see that what we've done for many other projects that have been um gone through our review with Caltrans and VJ.

So it's a very, very high point in what we try to do.

I understand that.

I understand that.

But what I'm saying is that a lot of these projects have the old uh sort of like idea of what it was supposed to be, right, versus today, and what changes need to be made to make it safer.

I know we're going towards making it uh safer, but you know, if you're a cyclist and you're faced with that type of uh situation, it is not safe at all.

It really is not.

And so I don't want the old sort of design or thought or whatever whatever it is to carry over into what is needed today.

That's my point.

Thank you.

That that's that's our goal also.

It always is like that.

That's why we win awards on all the projects we do.

Thank you.

Thank you.

Before I turn over to my colleague again, Councilmember Cohen, I will just comment that last week at the VTA Board of Directors meeting, we approved this very item unanimously.

I just wanted to put that on the record that the directors did have a discussion around this or it came before us.

Councilmember Collin.

Yeah, I just want to kind of praise first of all the process that we have on many of our interchanges.

We we do as a city, I know and VTA right now put a lot of focus on trying to do our best on bike and ped safety.

Not every interchange is ideal, but some are better than others.

Now, right now, if you want to go from Zanker to downtown San Jose on a bike, you either have to go to Brokaw and First Street Interchange, which is not the best place to be, and go down First Street and then have all those cross streets crossing each other just past the uh 101 overcrossing, or you have to go down to the end of Zanker and take Bay Shore and go past that awkward on ramp that cuts across traffic.

So right now there's we're trying to we're trying part of this project will be to try to add an additional option and another way that will reduce traffic in those other uh reduce cross traffic in some of those other locations and provide an additional route.

And I just to clarify, John, you asked the question about or you commented on this has a separated lane with um a raised curb.

Right.

So it's not you know you're still gonna have to cross a ramp, but I also you can confirm this for me too.

The old way of highway on ramps was keep cars moving and have a ramp.

This is one of the newer interchanges that will have stoplights at the top of the ramp so that cars aren't coming on and cutting in front of bikes.

Is that correct?

That's correct.

Um as you as you were describing the area.

Right now, there is no bike lanes crossing 101 on First Street.

There's no room underneath there, and then on 10th Street, which isn't very ideal because it doesn't get you anywhere there are none either.

This will provide a class four, which means fully protected, physically protected from travel lane, 17 feet wide, so it'll have two-way head and bike and a hard uh landscape and a hard uh barrier to protect the bicyclists while up there.

They will still have to go through an intersection that is signalized, however, but it is raised up, so it's gonna be level the sidewalk and the bike are gonna be raised out of the travel way with a full protection on it.

So we're making the best of what is a bad situation in that area.

I mean, it's we'd like to have better, but can't I can't emphasize enough how bad the Brokaw corridor is for biking right now?

We are this project should make it better, but I and I appreciate the fact that we are um that we are um flexible that there's some flexibility still and that there may be some design changes, but that we can't at this time commit to the number of lane changes without the environmental work that has to be done.

The entire North San Jose area had an had an overlay environmental plan for transportation that we're kind of bound by at this point.

So that's just kind of the the reality, but John is suggesting that that may be changing.

We are I'm very engaged in in all of our discussions about our updating our North San Jose transportation plan, and that may be an outcome.

But we can't commit at this point that that we can change it, and we also can't direct VTA to change it until we go through that process.

That's all I just wanted to say.

Thanks.

Thank you.

Council Member Duan.

Thank you, Vice Mayor.

This has been how many years has this been going on?

As we all know, they take too long and cost too much, uh, especially complex ones like this.

So environmental was three years, but before that we were doing some preliminary engineering and what's called a scoping document for Caltrans process, it was at least another year.

So we've been at this four to five years, probably.

You still got a number of years to get through design and then to construct this in the many phases that it's gonna have to be done.

So you're a number of years away from seeing the improvements out there.

Yeah, on page number two in the report, and in October 20th, 2015, um the VTA to provide the initial 1.5 million dollars, and then in October 31st, 2017.

Um the city contribute was 2.6 million dollars.

This is a the fourth amendment that we've gone through, and yet we we have no solid cost estimate of how much this cost, and then we're going from six-lane to four lanes, and so many changes.

I I have a concern because there time is money, and then we have to have a serious timeline to construct.

Because we keep going from 2015 and on and on till now when we haven't seen, and you said that the next process would, you know, the it'll cost well, it'll take about two years for the drawing and everything else, and then maybe something changes, but then it'll extend even more.

Well, I just wonder when are we gonna stop and we're gonna have a concrete time date, at least an approximate cost that costs the taxpayer to make this happen.

We have preliminary costs, but if you we could certainly provide what that preliminary cost estimate is today, but the more time we take, those tend to go up.

So moving what we did just complete was a really a fundamental milestone getting through environmental, which is Caltrans, and it's uh a significant step on the project to get that done, and now we can really start moving into a quicker pace, I think.

Yeah, and then how do we hold the VTA to their responsibility to cut you know get this done?

Uh we do that.

Uh they're a pretty good agency when it comes to this work that they do on the freeway system with Caltrans.

They've got a uh a very well experienced team, and they use private engineering companies in the area that know what they're doing, and they've got a real good relationship with Caltrans and us being there with them along in the driver's seat to push it along, really is the kind of the magic mix, I think.

Thank you all.

You'll want a time.

Thank you.

Seeing no the no other hands raised, let's vote.

Motion passes nine to one with Duan voting against.

All right.

Thank you all.

We are on to item.

Thank you, Vice Mayor.

One to item five point two.

This is the Transportation Development Fund Agreement and resource with resources for community development for affordable housing and sustainable communities grant funding.

There's no staff presentation as I understand it.

Tony, do we have public comment?

Not for this item.

Okay, can we back to the council?

Motion from Condela, second from Foley.

Let's vote.

Motion passes unanimously.

Great.

Thank you.

Let's go on to item 6.1 electrification workforce development programs.

And we do have a staff presentation.

We'll wait for Lori and the team to come down.

Lori and Kate.

Welcome.

Good afternoon, Mayor and Council.

I'm Lori Mitchell.

I'm the director of the energy department and very excited today to be joined by Kate Ziemba.

She's our senior environmental program manager and also Julia Benabente, who's our deputy director for Climate Smart.

This item is electrification of our workforce development program.

So we have several recommendations today to invest in workforce development.

And with that, I will turn it over to Kate.

Thank you.

So there are regulations and market conditions that are propelling residents towards electrifying their homes and transportation.

And we know that electrification will impact the workforce.

Our consultant estimates that 424 more building electrification workers will be needed by 2030 to meet demand.

And in many instances, workers will need to be retrained.

San Jose Clean Energy has received 970,000 in one-time limited funding from its long-term power purchase agreements with energy developers for community and workforce development.

And so we interviewed 30 labor and workforce stakeholes stakeholders to understand first the electrification labor market, how we can support workers in the transition, and what programs are already out there.

This engagement helped inform staff recommendations and provide staff with background as we look to scale our electrification work.

We heard that SJCE should invest in local training programs and help address their needs for up-to-date training equipment.

And we also heard that the city has a role in increasing demand for workers and shaping that demand towards high-quality high road jobs.

High Road Workforce Development is focused on improving job quality and equitable access to jobs that have career growth potential.

High road employers pay family supporting wages, compete based on the quality of their services, and engage workers in building their skills.

And based on what we heard from stakeholders, we recommend establishing two programs.

The first creates a 400,000 dollar grant fund for electrification training equipment and curriculum development for local training institutions.

We heard from local community colleges interest in purchasing equipment like heat pumps and creating new EV certificate programs.

The second provides 100,000 towards stipends for trades orientation program students at San Jose City College.

This is a pre-apprentip program focused on underrepresented students to help them prepare for a career in the construction and building trades.

We also recognize our role in increasing demand for workers.

This year, fiscal year SJCE is investing 10 million to incentivize building and transportation electrification.

We will explore new program models like direct install and neighborhood aggregation to scale electrification and attract high road contractors to the single family space.

Based on the stakeholder engagement, we will also make changes to our eco-home rebate program to improve installation quality and safety.

This includes requiring final permits and offering incentives to contractors to install heat pump at their own home or business to improve their familiarity with the technology.

We also have an online contractor directory where we display contractors who have participated in our eco-home rebate program.

We will have new criteria in order to be displayed there, which includes having no more than one OSHA violation and having no unpaid wage theft judgments.

And then finally, we will also create a new voluntary badge in the eco-home directory for contractors who meet our proposed high road qualifications related to health care, wages, and training and safety.

Qualifying contractors will have a yellow high road label next to their name, and the page will explain the criteria.

We hope this will be appealing to consumers and contractors, and that consumers who value these qualities will seek out bids from those contractors.

This high road badge is the first of its kind in the Bay Area, so we expect iteration and will continue to work and collaborate with stakeholders to improve it.

And so our recommendation is to adopt a resolution approving the proposed electrification workforce development programs.

And with that, we'll take questions.

Thank you.

Great, thank you very much.

Tony, do we have public comments?

Yes, Louise Auerhan, Vince Sugru, and Linda Hutchins Knowles come on down.

Great, thank you.

And you all are welcome to speak in any order.

Whoever gets down here first can get started.

Thank you.

Good afternoon, Mayor and Council members.

Louise Arahan with Working Partnerships.

And I want to thank San Jose Clean Energy staff for their diligent work on this topic and for really taking the time to listen to both the contractor and worker communities.

Today's item makes modest steps in the right direction, and hopefully we can start with these, learn from them, and come back with ideas on how to do more.

There's no shortage of workers for electrification and building decarb.

In fact, just the opposite.

There are many more people available and ready to work in these fields, and I should know because a lot of them come to us looking for work.

But there is a need to make sure both the workers and the contractors are trained and incentivized to actually use these new approaches and install them correctly so that the appliances actually work as described and that the workers are making an above poverty level wage and are able to support their families.

The badging proposal gives contractors a way to show that they're doing that.

It's voluntary, but it creates a framework to build on and it sends a market signal.

So I urge council to support this and commit to come back at some point to evaluate the progress.

I also wanted to express my thankfulness for the proposed student scholarships.

These would provide direct financial support to pre-apprentice students, enabling them to focus on their training and career search so that more of our underserved local residents can go into the electricians' apprenticeship, sheet metal apprenticeship, hype trade apprenticeship, and others, and start their careers as skilled trades workers learning green construction and energy efficient building.

I want to strongly support the mention of potential future plans to explore aggregation and direct install programs.

These are much more effective at both energy efficiency and job creation and serving low-income residents than rebates, and I would love to see more of that as a future direction.

Thank you very much.

Thank you, next speaker.

Good afternoon, honorable mayor and council members.

My name is Vince Grew, and I'm a state legislative director with Sheet Metal Workers Local 104.

We're the heat pump in HVAC union locally in San Jose, and really proud to be here today.

You know, I think really this is a testament to good governance.

We had a great experience working with staff from San Jose Clean Energy, fellow council members here who really wanted to see and put more San Jose residents to work doing building decarbonization, and I think that this is a great entry point for creating a high road contractor badge that recognizes everything that our membership stands for and what we fight for every day in our union in San Jose to grow our workforce.

In particular, I really want to thank staff for taking the time.

They actually came out and visited our training center off of Lundy Place up in Northern San Jose and really to understand what our members do day in and day out.

I would ask that it would be helpful to figure out how we continue to build on this program.

I mean, this is a voluntary incentive right now, and one of the things we're trying to do is create more high road contractors as a result of this because we have over 2,000 people on our applicant list right now up in San Jose who want to be union sheet metal workers doing HVAC install.

And in order to get those people into the program, we need more high road contractors.

So I think it would be great to come back in the future and do an analysis of this and think how can we further incentivize folks to actually you know change their business model or create more owner members from our membership to become contractors and doing this work.

Thank you so much.

We urge you to support this.

Thank you, next speaker.

Good afternoon, Mayor, Vice Mayor, and Council members.

My name is Linda Hutchins Knowles, and I'm the co-founder and team coordinator of Mothers Outfront Silicon Valley.

We're a group of 2,500 supporters, all volunteers that care deeply about preserving livable climate today or a healthy climate today livable environment tomorrow for all children.

We are in support of electrification workforce development program.

We believe this is good for workers, it's good for our environment, it's good for our climate.

Please also direct a review after one year as requested by the CCA workforce and EJ allies.

We believe that we definitely need a strong alliance, blue-green alliance if we're gonna conquer the climate crisis.

We have to make sure workers have good opportunities for jobs that are in clean energy and not polluting industries, and this would be a way to help that as well as clean up our community with cleaner air and a safer climate.

So thank you.

Back to council.

Thank you.

Let's come back to colleagues.

Apologies.

Let me just switch my screen and we'll start with Councilmember Ortiz.

Thank you, Mayor.

First off, I just want to really thank staff and let you guys know how much I appreciate your efforts on this topic.

I know that we've talked quite a bit in the past in regards to the importance of supporting our workforce partners.

And I think that today presents a major milestone in your work.

And so I really want to elevate you for that, and thank you.

I think that this program is extremely important to the working families, especially of our city, and it's crucial that you know, as our country moves in the direction of climate-friendly infrastructure, which I support, that we don't leave our workers behind, but we take them with us as we go along that journey, and we also take the time to cultivate a new healthy pipeline in preparation for the electrification of these jobs.

Apprenticeships have historically been a trusted pathway to the middle class, and I think that nobody does apprenticeships better than labor.

And I think if we want to get, if we want to create policy that is effective, and that actually is implementable and works, it's important that we consult with the experts uh in the field.

Um I also want to thank uh you for the badge mechanism that we're going to be utilizing in order to elevate um I guess uh high road contractors in the field.

You know, as we continue to see, you know, issues of bad employers across across this country, especially those who take advantage of the immigrant community, it's gonna be extremely important that you know we we elevate those who are doing right by our workforce.

I I did want to, you know, get staff's opinion on one thing.

Um would it be possible in probably a year for us to review or come back to council for review of just how effective these badges have been in order to distinguish or identify these high road contractors?

Yes, of course.

We imagine that we'll learn quite a bit um through launching this program and and at a minimum we would come back through our programs roadmap and report out on how it's going.

Great.

Then I I would uh motion to adopt a resolution in support of the program and also include uh just that language about in within a year to come back uh to review the uh the outcome and performance of the the badges.

Thank you.

Great, and just to clarify, we would be adopting the uh the staff, the latest staff memo, which is the most up to date.

Supplemental memo from staff, and then you're okay with the update being incorporated into one of the climate smart reports, right?

Absolutely.

Okay, great.

Perfect.

Second from Kamei.

Let's go.

Thank you both.

Let's go to Councilmore Condelas.

Thank you, Mayor.

Um, no, I just um, you know, I'm really supportive of providing our workforce's skills to adopt uh to this transition and a more sustainable future here here in our city.

And you know, I think as we continue to pursue our climate goals, I think we need to continue to foster um a skilled labor force in order to drive these innovations forward uh working with not just our our local uh community colleges but also our our labor unions and trades.

Um it's it's a great way for us to strengthen these existing programs and reach a more diverse group of people uh that can continue that can contribute to making San Jose uh carbon neutral.

And that in fact, you know, last week I was at Everen College's 50th anniversary and and mentioned it to uh to the president of how we can partner with um Evergreen College and different different community colleges here in our city to see how we can um you know create some synergies there and and open up that pool of students that you know walks takes the bus to to our local colleges and and hopefully gets them a job that's well paying and and um and and can contribute to to our society knowing how expensive it is to live here.

Um so uh thank you, Lori, Kate, Julie, um, as well as our our clean energy staff uh for your work on this and for bringing this forward.

Thank you.

Thanks, Councilman.

Let's go to Councilman Cohn.

Yeah, I'll just be brief and just thank staff and thank all the partners on this one.

I think we've been talking for a few years about how we're going to achieve our our climate friendly goals, and one of the clear things that was always there for me was how we're going to build a workforce that's going to go out and and assist all the residents who are you know are going to take advantage of all the opportunities that they now have to do the right thing, but also to make their house more energy efficient, reduce costs um on their electric bills, and um, you know, upgrade their panels and be ready for what's coming in the future.

And so um I I'm appreciative that we've had we had conversations early on about how we involve um our labor partners, and I'm really glad that uh the sheet metal workers, IEEE, and all of them have been great partners in figuring out how we move this forward.

So I want to just thank both of you, and I'm I'm glad that we're we're um at this stage and and we're gonna see and I appreciate the uh the idea of coming back and making sure that you know the program is working and and get some feedback from people as it as it becomes more uh robust.

Thanks, Councilmember.

Let's go to Councilmember Duan.

Thank you, Mayor.

Thank you for the report.

I appreciate the fact that there's 100,000 go toward the scholarship.

But I do have a question on regarding the grant.

Who would be qualified for those grants and who are you guys reaching out to in order for them to apply for it?

Thank you for your question, Councilmember.

For the training equipment grant program, um, it could be local community colleges, but it could also be other trading institutions locally.

Um we plan to take kind of a broad lens.

So it could be for example, um, local union apprenticeships, or it could be um, you know, Goodwill has a training program, for example, for the trade.

So we plan to be pretty broad.

And and how much can they apply for?

Um we will set limits within that 400,000.

We have, you know, some initial estimates based on need, but um we do hope that that funding will be enough to fund training of equipment both for building electrification and transportation, and um, should you know more funding be needed since we have more available, we would come back to the city council with a recommendation.

Yes, because I know there's there's a lot of not only the the union trade, but there's private training ground as well, and I I want to make sure they they can apply for the grant and spread the wealth.

Thank you very much.

Great.

Thanks, Councilmember.

Thank you to staff.

I think we're ready to vote.

Motion passes unanimously.

Okay.

Great.

Thank you all.

We are continuing on with energy issues.

We're on to item 6.2 existing single family building reach code.

We have a staff presentation so I'll hand things back to Lori.

Yeah thank you very much.

Happy to be joined again by Julie and Kate.

Julie's our deputy director over at Climate Smart and she'll be leading us on this item.

As you know the city has had building reach code since 2019 and we are recommending an additional reach code that's focused on single family buildings focusing on helping them electrify through heat pumps.

And with that I will pass it over to Julie.

Thank you, Lori.

Okay, I'm going to start with just a little bit of background on building standards and reach codes.

The California Energy Commission sets these California building standards and the city also adopts those standards typically every three years.

And in every code cycle since 2019 the city as Lori has mentioned that we adopted building reach codes typically in the past they've been around new construction.

And those REACH codes go beyond state standards to further city climate goals reach codes can typically be adopted at any time although they do have to be shown to be cost effective.

But new state law AB 130, I think as many of you are familiar with that does limit the city's adoption of the residential REACH codes from October 1st 2025 through June 1st 2031 unless exceptions apply so as Lori mentioned we're proposing a building reach code with two components that would apply only to existing single family buildings the California building standards now have for new construction have basically reached a level where our reach code previously was so there um one is that they're not really needed so much in that area anymore.

But because of our climate goals we've um you know consistently said that we would want to look at how we can help existing buildings both take advantage of the financial advantages to building electrification as well as um help our climate goals so uh the first component of the proposed reach code is what we refer to as an AC to heat pump component and the second is an electric ready component and I'll talk about those in detail in the next slides.

So for the AC to heat pump reach code component if someone is replacing or adding an AC in an existing single family home then they can choose one of two pathways the first pathway would be to install a heat pump HVAC system and that those do provide both cooling and heating or the um homeowner can install a standard AC as was um originally planned and and go ahead and make energy efficiency improvements above the state standards those are spelled out in the reach code language.

Some of the exceptions to this component are around um older homes with the the old knob into borrowing as well as um if a if this requirement triggers a panel upgrade then that would be they would be exempt and a couple of other um items that are listed on here around asbestos and accessibility and we also have added um an exception for households with incomes up to the 100% of the American American area median income.

And then I'll pass over to Kate to talk a little bit about some of the financial assistance here.

Sorry actually I'll talk a little bit about cost estimates and then Kate will talk about the financial assistance available so um some of the estimates for the incremental up cost um the upfront cost for the pathway uh one for the heat pump to HVAC installation is approximately 650 to 1700 dollars that's the incremental cost difference the um pathway two, which I talked about was is just the standard AC with additional energy efficiency measures.

Those measures can include things like fan efficacy, air sealing, and attic insulation, and the estimate staff estimates that the associate cost for compliance for that portion would be 600 to 7500.

It's a a fiery wide range just because it's based on the exact project that's there, the existing configuration at the home, as well as the scope of the planned upgrade.

And now I will pass it on to Kate to talk a little bit about some of the financial support that's available for this work.

Thank you.

So single family residents can access incentives for installing high efficiency heat pump HVAC systems.

Through San Jose Clean Energy's eco-home rebate program, we offer 2,500 to $3,500 towards a heat pump HVAC installation, with the higher amount being for income qualified households.

We may lower the incentive in the fall just to be more in line with the industry and what other community choice aggregators are offering in their incentive programs.

This fiscal year we have a budget of 2.675 million, which could fund an estimated 590 heat pump HVAC systems at this funding level.

Right now residents can also access the state's rebate through the Tech Clean California program, and that offers up to $4,000 in additional incentives that can be stacked on top of San Jose Clean Energy.

And then finally, we offer an eco-home payment plan program, and that this provides zero interest loans for installations that are repaid on bill, and loan terms are two, three or five years and up to $5,000.

And sharing here a study from Peninsula Clean Energy and Silicon Valley Clean Energy that shows that installing a heat pump has first-year bill savings ranging from $300 to $500, with the higher amount being for high efficiency equipment.

And so within a few years, that incremental cost can be paid off just through bill savings.

Pass it back to Julie.

So the electric ready component of the proposed REACH code would only apply to customers who were already doing alterations in our additions within a specific proximity to an existing gas appliance or including a new gas appliance.

It would require some electrical infrastructure, things like circuits, conduits, reserve breakers, and covers stovetop cooktops, dryers, as well as water heaters.

And therefore this component would not apply to those projects.

Costs for electric ready may range from approximately $150 to $1,000 per appliance, and we also have exceptions for this component, which are listed here.

One that I want to point out is if the reach code triggers an electrical service or panel upgrade, and also we have the same exception for households that have an income up to 100% of area median income.

So this slide provides some detail around the community outreach and engagement that we conducted.

We had five city webinars which were promoted through a variety of means that are listed here.

We also presented at the city developers roundtable.

We had there was a regional virtual and in-person event where contractors were invited, and there was also we also released a frequently asked questions document on our website based on all the input and questions that we had through all that throughout that outreach.

So in response, staff has updated the proposal to include the exception for the households earning up to 100% of area median income, and we also will be seeking approval for fiscal year 2026-27 to have the eco-home rebate funding, you know, for the eco-home rebate funding to continue in order to help community and workers prepare for the air district rules that are coming starting in 2027.

And just going on into a couple of reasons why we're looking at this, these this reach code and proposing this REACH code.

As I mentioned, the air district rules will be starting in 2027 with in 2029.

It will be applying to gas furnaces.

We buildings in San Jose are about a third of the San Jose's greenhouse gas emissions, and a significant portion of those are residential buildings, and which is over 185,000 single family homes in San Jose.

And heat pumps represent a significant reduction that we can have over the gas options.

But there is also cost effectiveness for residents in terms of both a day one utility bill savings as well as life cycle savings.

We have this available financial assistance that we talked about, and as uh Kate and Lori presented a little bit earlier on the workforce preparedness.

This is part of that effort, and for AB 130, which limits the reach codes starting October 1st.

As I mentioned, we want to make sure that we're positioned to be able to continue our great work to promote to reach our carbon neutrality goals.

And also just in terms of timing for this REACH code and it coming forward right now.

We do typically try to align the REACH codes with the regular building code cycle, which would start January 1st, 2026, and this allows some time for the administrative process to be able to submit the reach codes for final approval by the CEC and proceed be able to proceed with those.

I won't go into detail on this slide, but just to say that you know San Jose has consistently been an environmental leader on REACH codes, and also that we are not alone in this endeavor.

There's quite a few Bay Area cities, and probably more on than on this list that are already working on or have adopted REACH codes, and actually right along in the same timings similar to San Jose.

So we are recommending that there's approval of the proposed REACH code ordinance and authorization of the city manager to submit the REACH Code package to the Building Standards Commission and the California Energy Commission for approval as required by law.

We'll go on to questions.

Thank you.

Thank you for the presentation.

Tony, do we have any members of the public who wish to speak?

Yes, I have several cards.

When I call your name, come on down.

First person of the microphone gets to speak, so it's no particular order.

Colleen Kerrigan, come on down, Jocelyn Anaya.

I can't read the last name, but Jocelyn come on down, Dash Leeds, and Wendy Cho.

And then I'll call a few more names in a minute.

Go ahead.

Good afternoon, Mayor and City Council members.

My name is Jocelyn Anaya Galvan, and I am a district one resident and also here representing the environmental nonprofit Menlo Spark.

I urge the city council to approve both REACH codes, but at minimum approve AC to heat pump reach code.

Just because San Jose's leadership is really crucial to having these climate change policies spread statewide and beyond.

This is also our last chance for the next six years to update our building code in this way, so we can't let this window of opportunity get away from us.

Right now, the Bay Area District, like was like it was said in the presentation before, is leading the way to the planned phase out of gas appliances, starting in 2027 and 2029.

These REACH codes will help future-proof homes right now in order to get ahead of the new rule, the new rules.

I'd also like to touch on some important considerations for adopting at least AC to heat pump.

The first is cost to residents, and the second is public health implications.

2025 studies show that the average resident and renter save at least 20 to 30 dollars a month on their utility bill.

It's shown by several studies, SVCE, PCE, the Rocky Mountain Institute, but they also take the recent electricity transmission rate increases by beat by PGE and still show monthly cost savings.

These savings are even larger for folks enrolled in the care and FARO programs, which offer deeper discounts on electric bills and on gas bills.

The second implication here is public health benefits.

We know that gas combustion in building appliances releases nitrogen oxide and other carcinogens pollutants, both inside and outside buildings.

Children, seniors, and low-income residents of color who already live in communities with higher air pollution are at more risk from these negative health impacts.

I'll cut my thank you, next speaker.

I'd also like to call an anonymous card and then Kim and Grace come on down.

Go ahead.

Good afternoon, Honorable Mayor Mahan and distinguished city council members.

My name is Wendy Cho.

I'm here on behalf of ACTERA Action for a Healthy Planet, a nonprofit based in Santa Clara County that educates and advocates for communities to take action on the climate.

I am fully supportive of both building reach codes being discussed today.

I'll just pause and let us think about the moment that we're in right now.

Our climate now is unprecedented.

Think about it.

Our current climate differs from what all past Californians have witnessed.

Wildfires are becoming a year-round concern and fighting them is eating up our state budget.

Summer heat waves and winter floods are deadlier than ever before.

Families in San Jose are hurting from breathing wildfire smoke or being unable to buy home insurance because of climate risk.

So we have to take action now.

We need to scale solutions fast.

Thankfully, electrification of our existing buildings is a solution with big impact.

Electric appliances like heat pumps reduce pollution indoors and outdoors, since you aren't setting anything on fire as you do with gas appliances.

And because they're so energy efficient, residents will save on energy bills as has been discussed already.

Electric readiness is about being proactive and prepared for the future.

The AC to heat pump and electric readiness reach codes will encourage win-win decisions as people renovate and improve their homes.

It's been shown that nearly all homes can fully electrify on a 100 amp electrical panel, and there are a lot of incentives available for income qualified households.

I urge you to approve both building reach codes today, and I commend San Jose for taking a leadership role in joining other communities around the Bay Area to show how electrification is working today on the ground.

Recently, in Benlo Park passed its suite of REACH codes, including AC to heat pump and electric readiness and Sunnyvale as well.

This is the right time to join them.

Thank you so much.

Thank you.

Next speaker.

Jordan, come on down too.

Good afternoon.

I want to thank the City Council, Honorable Mayor, and San Jose Environment for championing this issue and prioritizing the health, safety, and sustainability of San Jose for future generations.

My name is Colleen Corrigan, and I work with the Civic Policy Research and Advocacy Organization SPUR.

Our sustainability and resilience team is prioritizing decarbonizing our building stock and making sure that the Bay Area is resilient in the face of climate-related natural disasters and earthquakes.

Moving away from natural gas as this REACH code enables and empowers San Jose to do will eventually decrease the need for planned safety power outages and increase the grid's capacity and resiliency in the face of emergencies, power shutoffs, or rolling blackouts.

You'll hear people in industry opposition say it can't be done, that is too complicated or difficult, but the evidence is pointing in the opposite direction.

Increasingly, it appears that we're in an inflection point in the market for heat pumps and the electrification workforce.

While the 2026 National Electric Code will that will eventually be adopted in California, unlocks panel capacity and will save homeowners money on an unnecessary panel upgrades.

Technical experts are also busy solving key issues.

In particular, we've worked on avoiding the need for panel and service upgrades.

With smart design decisions, such as choosing power-efficient equipment and use of smart controllers, many building owners can avoid this step in electrification journey.

A Spur analysis of Tech Clean California program data showed that of the 1,764 homes with 100 amp panels, 96% could add a heat pump, water heater, heat pump, HVAC, or both without upsizing the panel.

By taking watt dieting approaches and utilizing power efficiency and new tools, owners of single family homes can easily electrify all common end uses.

For example, by switching from a central AC to a heat pump system, households can save 300 to 400 years on operational costs and utility bills.

Planned and well-time electrification is crucial, and this legislation makes sure that more buildings undergo cost-effective planned electrification when equipment burns out.

Thank you for everyone who's worked on this and spearheaded this important work at a time where state and local action is more important.

Thank you, next speaker.

I'm a resident of District 9.

And I'm fully supportive of both REACH codes.

There is no pathway for San Jose to meet its carbon neutrality goals without aggressive building electrification.

I myself replaced an old gas furnace and AC unit with an HVAC heat pump, and I'm very satisfied with the performance of the heat pump.

Especially I'm happy that we don't have to breathe in toxic components of methane, which leaks everywhere, and the byproducts of gas combustion, including life threatening carbon monoxide from faulty appliances.

And we also have to consider the market dynamics since 2020.

Heat pump sales have outpaced that of gas furnaces every year.

Last year, heat pump sales exceeded gas furnace sales by 34%.

The city is not doing homeowners or the climate any service by not incentivizing the switch out of gas furnaces.

If home owners install a new gas furnace now, in replacing uh an old gas furnace, that new gas furnace will be in service for 20 years at least.

And as the building decarbonization proceeds, PDE will have less incentive to upkeep their infrastructure that will be soon retired.

Homeowners will have trouble finding technicians to service gas furnaces as the market will switch to uh electric um appliances.

Thank you.

Thank you, next speaker.

Also, Ruth and Linda come on down.

Hello, my name is Dasha Leeds.

I'm the conservation coordinator for this year at Club Loma Prieta chapter and a district six residents.

Our chapter fully supports the adoption of the full reach codes before you today, including the AC to heat pump language and the electric ready components.

I bring you good tidings that last night, Palo Alto City Council unanimously adopted the first reading of their REACH code, which also includes ACD heat pump language.

This adds to the list of cities that have adopted AC to heat pump language to include Mountain View, Memo Park, and Sunnyvale.

Electric heat pumps provide a number of benefits, including emissions reductions and critically improved air quality.

And since heat pumps provide space heating, this saves residents from the need to operate or replace their gas furnaces.

And these heat pumps are extremely energy efficient.

As noted in the supplemental memo, the analysis conducted by PCE and SBCE found that operating a standard efficiency HVAC instead of a gas furnace and AC can save residents $311 per year on energy bills.

Furthermore, as noted in the supplemental memorandum, home electrification can often be achieved without the need for panel or service upgrades.

And these upgrades are often cited by those who have concerns.

I invite those interested to read the case study of whole home electrification of nine low-income homes in San Mateo County, which was linked in the supplemental memo.

In the study, on average, customers saved 20% on their energy bills.

No service upgrades were required in any of the homes participating in the study, and customers left the study highly satisfied with an average satisfaction rating of 4.6 out of 5.

So as the October 1st deadline approaches, council's leadership is urgently urgently needed.

So let's take action while we still can and send a signal to other jurisdictions that climate policies are, while they're still under attack, that they're highly important and that we do still care to take action.

Thanks for your time and consideration.

Thank you, next speaker.

Good afternoon.

My name is Kim Trong, and I'm a student from District 7 and a member of the Silicon Valley Youth Climate Action Team for San Jose.

I strongly support the existing single building REACH Code and urge you to approve the full staff recommendation or at least alternative one.

As a student, I worry about how air pollution and the climate impacts harm my health and the health of my peers, especially in neighborhoods like mine where heat and asthma are already major issues.

I've seen firsthand how elders, children, and low income families are the most vulnerable.

This ordinance will make homes healthier, safer, and more resilient.

San Jose has pledged to reach carbon neutral by 2030.

Passing this ordinance is a vital step to protect our community, especially youth like me, from the growing threats of climate change.

Thank you for your time.

Thank you, next speaker.

I'm a student at Archbishop Middy High School and a member of SVYCA.

Climate change is the biggest threat facing all of us today.

We're looking at a clear solution that would bring San Jose much closer to reaching our net zero goals, which is this reach code, which has been projected to prevent thousands of emissions from being released each year.

Heat pumps are three times more efficient than AC and gas furnaces.

And they also save money $300 to $500 in electrical bills every year.

There are some concerns about the higher upfront costs of heat pumps, but we have to look back at the long-term costs to truly understand the financial picture.

Right now, we can see that the upfront incremental cost of a heat pump is 700 more than an AC.

However, that is compared to the lifetime utility bill savings of up to $10,000 with a heat pump.

It becomes very clear with this that heat pumps are actually what saves homeowners money.

Additionally, San Jose Clean Energy and several other agencies offer financial assistance to those who may not be able to afford the switch.

Let's move on to the electric readiness requirement.

This requires homeowners who are making certain renovations to their homes to install additional electric infrastructure.

This saves homeowners a lot of grief later on when they want to install these electrical appliances, saving them thousands of dollars and hours of time from another renovation.

This reach code is what makes sense.

It's for the betterment of homeowners, the San Jose community, and the environment.

It is what San Jose wants with 95% of letters on this reach code being supportive ones.

Please pass this reach code.

Thank you.

Thank you, next speaker.

Jordan Moldow, District 3.

I want to thank staff for the report and for the months and probably years that they spent working on this.

Climate change is an incredibly tough problem to solve, and at its core, it's also an equity problem, which makes it even harder to solve.

And the gnarly thing there is that if you don't solve it, your equity priority communities suffer.

If you do solve it, there's still a lot of financial pain and lifestyle pain as you go and you try to make that transition.

But at least if we do the work to make that transition, we can do things to try and reduce that pain.

And that's why the city offers rebates in order to make the cost lower.

And we have exceptions in cases where it doesn't make sense to force someone to make that change.

But by making this change that the staff is proposing today, everyone will upgrade when it's the cheapest and most convenient to do so rather than needing to make a more expensive and harder to make change at some future date.

So I encourage you to support the staff recommendations on all of the ordinances and the additional uh direction to staff that is in the memo from Councilmember Cohen, the mayor, Candelas and Tordillos.

Um I personally I advocate for transit improvements a lot.

Transit is 50% of our emissions, but we're never gonna get to zero on our transit emissions.

So we need to tackle this from other angles.

The team here, they're not gonna go out and build bike lanes for me or build buses, but what they can do is make our electricity much cleaner, and that's the proposal that is in front of you today.

So please take it, and just as a final reminder, this isn't gonna impact new housing construction at all because it's a reach code for existing households.

Uh so again, please support the staff recommendation and make our energy cleaner.

Thank you.

Thank you, next speaker.

Hi, my name is Um Ruth Marino, and I'm with San Jose Community Energy Advocates.

This morning we uh sent a letter to you uh outlining pretty much everything that's been said here today.

Uh, we are we did um our letter um is in support of the full proposal um by the staff.

Um, but in absence of that, um, we would also support alternative uh number one.

Um I'd like to thank Lori Mitchell and her staff for um setting up this reach code to make it as easy as possible for our residents by uh putting in exceptions.

For example, if you need a panel upgrade, you don't have to do that.

Um demonstrating how um the rebates will cover the difference in cost because this is for people who are already remodeling their homes.

And the other important thing is this is to address the climate crisis, which is affecting all of us right now, but even more so all the students who submitted letters to you, and another big problem is the fact that the federal government is backtracking on everything, so it's really up to you to address the climate crisis on social media.

The federal government is saying that uh is not addressing the fact that uh renewable energy um has um uh renewable energy such as wind and solar, um, it can be used at night with batteries, they're not addressed they're not um showing that that's there.

So it's really up to you.

So please uh support today's reach code.

Thank you.

Thank you, next speaker.

Hello again, Linda Hutchins Knowles.

I'm wearing three hats as I speak to you today.

As a mother, as a resident, and as the founder of Mothers Outfront Silicon Valley, and I'm asking you what hats are you wearing today?

Are you wearing the hat of a parent who has a child or grandchildren who face the climate crisis?

Are you wearing the hat of a person grounded in evidence that listens to the arguments and sees misinformation and calls it out for what it is, or are you beholden to other interests, perhaps?

The Realtors Association that sent misinformation, our letter this morning debunked all of their false claims, all eleven.

Are you gonna repeat their falsehoods and betray all of the residents who are depending on you for protecting our climate, protecting our community?

There is no acceptable reason to not support this reach code.

It will not affect low-income residents.

They are exempted.

If you earn a hundred and eighty-four thousand dollars, family of four, you do not it's not apply to you.

And it will save residents money, and there are rebates.

And if you think that the rebates aren't enough, then that's your responsibility.

You control the budget, you made cutbacks to the San Jose Clean Energy budget and the new organization, and you can restore them.

This doesn't have to be so hard.

And I am actually appalled.

We have seen our city lead on every issue.

You adopted the existing building framework, unanimous vote except for Deb Davis.

Everybody else, Pam Foley included, supported it.

Everybody here supported it who was on the council then.

And now you say it doesn't apply to existing buildings.

We cannot reach our climate goals without addressing existing buildings.

So if you decide not to support this, you are betraying your community.

You are betraying the residents.

Every commenter here today is in favor.

30 out of the 40 letters sent were in favor.

And those that were not were based on misinformation, spread by special interests.

I am really thank you.

Back to council.

All right.

Thank you, Tony.

Coming back to the council.

Thank you all for your public comment.

We'll start with Council Mr.

McCollen.

Thank you, Mayor, and thanks to everyone who came out to speak today.

You know, I've been I've been bragging about our city's um leadership on climate and being the first big city in the United States to commit to being carbon neutral by 2030.

But a commitment on paper is not action.

A commitment is is a vision.

But the but we knew from the beginning that the vision would take some uh actions along the way.

The two biggest um drivers of carbon emissions are transportation and existing buildings.

Unless we address both of those, unless we make start to move the needle on both of those, we have no chance of achieving our objectives.

We're only five years away from 2030.

So today we're talking primarily about the uh HVAC to heat pump uh transition.

I'll talk a little bit about the other things on the on as well, but I want to talk more about that.

You know, it was very interesting.

I want, you know, I read all the emails that came in over the weekend, and I remember I saw one where someone said, I um when I replace my HVAC system, I want to get exactly the same system I had before.

Now I don't know anyone who owns a car who 20 years later says I want the same exact car I had before, anyone who knows a TV who says I want the same TV I had before.

I certainly wouldn't buy an iPhone 4 today.

Um I'd buy an iPhone 16, maybe even the 17 that was announced today.

But I don't understand the idea that we don't want embedded technology in our home.

So I just, you know, that was kind of surprising to me.

Um and we've seen a lot of um, we heard a lot of good comments today, but I want to read, I you know, we had a lot of emails, and I know most people didn't have a chance to read a lot of the background letters that came in today.

So I want to read four paragraphs from the U.S.

Green Building Council discussion about that came in today about heat pumps.

It says the best time for households to switch to heat pump is when they need to replace their air conditioner.

This is because existing APC system has the necessary electric wiring capacity to place in place to allow for a drop-in replacement with a heat pump.

But when air conditioners break down, HVAC contractors often recommend like-for-like replacements, depriving customers of the opportunity to instead install a heat pump and displace polluting gas heating and the need for expensive furnace replacement down the road.

While the upfront cost of installing heat pumps is about $2,000 higher than one-way air conditioning, the 2500 rebate available from San Jose Clean Power plus state rebates layered on top of that actually make these appliances more affordable for San Jose residents.

Furthermore, eliminating the need to replace a gas furnace later will avoid thousands of dollars in future costs.

In addition to being all electric, heat pumps are also extremely efficient, generally three to four times more so than conventional gas furnaces.

This means that when households make the switch to heat pumps, they can reduce their monthly energy consumption and utility bills.

So what we're encouraging here is a transition from AC to heat pumps to help us achieve our goals and to help our residents.

And so I just want to uh discuss a little bit about the memo.

I want to thank colleagues, Councilmember Tordillos, Councilmember Candelas, the mayor, also Councilmember Mulcahi was in there.

We because he was traveling last week, we couldn't get him to sign on to the revised memo on Friday, but all four offices were definitely instrumental in helping us reach this compromise proposal that we're bringing forward.

There's been some concerns, and I think our memo addresses the concerns by asking staff to continue to study the levels of our rebate program.

It asks them to continue to do more outreach to make sure that as this program gets rolled out that that we understand if there's any uh unanticipated financial hardship.

And annually they do bring forward to T and E and the council their San Jose Clean Energy Roadmap.

So we're asking them as part of that to also look at whether or not there's any ways to facilitate electric panel upgrades for those who are exempt under the electric panel upgrade um exemption and connect residents with resources to to meet the REACH code requirements.

One thing that's important is that our contractors and residents know that when they make these changes, there are rebates available.

And in most cases, with a responsible contractor, it's actually the contractor who fills out the rebate forms, submits it, helps people get financing, and it often isn't even the resident who has to do that.

I know from work that I've done that the contractors are very interested in making sure this works, but our department should help the contractors fully understand the process.

We also want to ensure, and that's so that's a third item.

Um, and then two items that we want to come back in the future.

One is this policy at this point exempts household those house homeowners below 100% AMI from this requirement because there was some concern about whether or not that will be a hardship.

Uh some of us, and I particularly believe that this is actually um sends the wrong message.

Uh given the rebates and the and the benefits, I would think that all of our residents should benefit from this transition.

Um we know that people low-income homeowners are most likely to live in in air in communities of high air qual low air quality impact.

Many of them already have low air quality, and having NOx ignitions in one's house only contributes to low air quality.

We're saying that you can get a heat pump and eliminate some of those NOx emissions from having a furnace running in your garage, you know, throughout the day throughout the year, and actually make air healthier in your community.

And I think all residents, including low-income residents, should benefit from that.

Not to mention the fact that once that given that it's a break-even because of the rebates, that saving $330 on average per month or per year on your uh energy bill is something that everyone should be uh at least encouraged to take advantage of.

So I'm at we're asking for staff to come back in a year to reevaluate whether this exemption remains necessary for low-income homeowners.

The second one is we are not we're asking not to implement the pre-wiring requirement at this time, simply because there's a lot of misunderstanding about who it would apply to and what the income cutoffs and what the project cutoff should be, what projects should trigger it, and asking staff to come back also within a year with a more um detailed proposal as to what projects it would apply to and which ones it wouldn't.

So the pre-wiring was causing people a lot of angst.

I believe prewiring would be a great thing, especially as we're trying to encourage the adoption of electric appliances, but I also understand that we probably need a little more detail before we approve it.

I will point out that as was mentioned, other cities are doing this.

Uh, Mountain View has included pre-wiring in their reach codes.

Um I believe um uh I know I think San Francisco has as well.

I know other cities certainly have been adding these these um these reach codes.

Just last night Palo Alto approved their reach code by a unanimous vote on their council, which includes the AC to heat pump conversion.

It's not I don't I would really be disappointed if our city falls behind our neighboring cities in making progress on our climate goals.

And then the final thing I just want to do is kind of dispense with the red herring of AB 130 for a moment.

And that's a question for Lori, Kate, and Julie.

My understanding is this this proposal for reach code for existing homes was in the works long before we knew about AB 130 and was planning to come to council this fall.

Is that correct?

That's correct.

Right.

So we we're not doing anything uh special or hurried as a result.

In addition, I'll ask Nora for confirmation, but the exemptions included in AB 130 included cities that already have in their um general plan a path forward on electrification.

Therefore, we meet the exemptions so that we're not actually bound by that.

Is that correct?

Or we believe so.

We believe so.

That's my understanding.

You know, we there's always legal uh ambiguity on some of these things, but we believe based on our interpretation.

So AB 130, people might want to use it as an argument, but it really isn't an argument.

Now, I you might know I wrote an op-ed opposing those provisions in AB 130 that originally was AB 360 was published in June before the legislature passed it.

A B 130 was intended specifically to make sure that we didn't get in the way of new construction, and really wasn't about existing construction anyway, about existing homes.

So this shouldn't have any impact on the ability to build new housing.

And we already have a reach code for electrification of our of new homes in the city, and we also know that new homes are uh that electric homes are actually cheaper to build than um homes would have to have gas lines in them.

So there's really no economic incentive to continue to include gas in new construction.

It was interesting at a conversation I had at the state level on this issue back in uh May, I think it was, I heard from contractors and developers who said we don't think that building code should be paused for five years.

We think that it's important that new construction always includes the very best and latest of technology and and and um construction methods.

So it's not clear to me the rationale behind AB 130, but given that it's there, some cities are going to be limited in what they can do, but not San Jose in terms of this kind of reach code because of our um very thoughtful general plan and and things that we put in in the first place.

So with that, I want to move um the memo, the joint memo between with those signed by Councilmember Tradillos, Councilmember Candelas, and the mayor.

Thanks, counselor.

Appreciate it.

Let me turn now to Councilmember Casey.

Thank you, Mayor.

Sort of feel like I'm stuck in an Orwell novel with all these buzzwords thrown around.

The climate and smart it's not clear to me that this actually impacts our climate and whether or not it's smart species best.

The original memo you guys put out the numbers in terms of the estimation and costs were woefully inadequate.

You guys use state averages no one talked to anyone in San Jose about the cost of doing the work here in San Jose.

When we're going to inflict an financial hardship on our residents, I would assume that we're going to do some sort of rigorous or exhaustive research or analysis into the numbers that we're going to put forth in terms of the ultimate impact on our constituents we live in arguably the most expensive city in the most expensive country in the world I don't think we did enough work.

I'm not confident that any of the numbers here make sense for example you say existing building energy is one third of San Jose's greenhouse gas is that just single family homes or is that commercial buildings as well.

Yes so the one third is for building energy usage in our community wide emissions.

So it's not just single family homes and I think we sent some updated information about um the portion which is the majority of it is from residential we're not able to parcel out the single family versus multifamily but it the majority of those emissions are from residential buildings.

Majority you mean single family versus even commercial not just multifamily homes uh industrial buildings.

Correct so the way that the data is grouped is commercial industrial versus residential and so residential represents the largest portion of our building emissions.

What percentage was that?

So 46% of the building greenhouse gas emissions are from residential and 59% of our natural gas emissions are from residential so the majority for both of those are from residential and the 46 is not the majority I'm sorry what?

You said 46.

It's the largest portion I'm sorry that's uh because the commercial um portion for is uh 30 is 27% so commercial industrial represents 27% of building greenhouse gas emissions.

And then you say in your updated uh memo that folks at 100% AMI won't be required to pay and so how are we going to verify that folks are at our 100% AMI or not?

Yeah thank you council member that's something that we're working on in the implementation phase of this we want to align with how other city departments are verifying that so that's something we'll be continuing to coordinate with the planning department on.

So we don't have a plan we're not going to ask folks for their IRS forms.

Ultimately probably what we're gonna do is ask them to self-certify so anybody can basically say they're at a hundred percent AMI and there's no way for us to enforce that or to go back and ensure that they actually are at a hundred percent or not.

I I don't know that that is correct it's it is an implementation detail that that we are still working through the city does um administer a number of low income um programs and so what we're trying to do is to align with how other departments do this like the finance department and and parks and other departments so that's a detail that we're working on in in the implementation phase.

Can I Eric Sullivan do you mind coming down for a quick question?

Sorry to put you on the spot in the housing department how do you guys verify whether someone's at an AMI level?

So thank you.

Eric Sullivan, Housing Director.

So in the housing department, our programs and financing are set up differently because we're required to, by either state, federal or city code require verification of household income, which is checking sort of the totality of the household income and going through that analysis on an individual with digital basis.

So it's just set up differently than other programs.

I know Parks of RAC and other programs do or light touches.

Ours is far more intensive because of the subsidies and the requirements of our different program finance.

So would folks be giving you private information like tax returns and things of that nature.

Okay.

Thank you.

Appreciate it.

So I'm again I'm I'm not clear.

I know you guys aren't going to go to that extent and ask for IRS numbers.

So anything short of actually getting somebody's IRS information, tax information, how are you going to verify that anyone's at a hundred percent AMI?

Yeah, I'm sorry, Councilmember, it's it's a detail that we're still working through, so I can't give you a specific answer.

So I mean, what what are we voting on here?

Then we're not we don't have a fully baked plan here on how we're going to implement this.

And so I I again I'm for being climate smart, but just throwing a bunch of buzzwords and virtue signaling that we're doing something for the climate when there's no actual results that we can verify, and then inflicting this financial hardship on folks just again to virtue signal.

I think it's it's the wrong path.

And when I was campaigning, the number of people, this is the type of stuff why people are moving out of California.

This type of policy blindly because we're under the banner of climate change, just following any policy that you put under that banner.

We need, and the lady up uh mentioned grounded in evidence.

I don't see the evidence.

And what is the actual result here if we do pass the heat pump?

What is the climate impact that it'll have on us?

Uh so in the memo we talked about um a percentage of community-wide greenhouse gas emissions, and um I think that was the 0.1%.

Um I think I would just want to point out, I guess, a couple of things.

One is, yeah, that's seems very small.

Um, but you know, uh I think as even one of the speakers mentioned, um, there's a lot of different measures that need to go into place um in order to progress towards our climate goals.

So this is certainly only one um out of the number that are already going on, and um, you know, probably planned in the future.

Um so um that's one piece, and I think also just because of the size of our green our community-wide greenhouse gas emissions, which are very substantial because we're a large city, of course, so um that that one point one percent does uh as we noted in the memo represent about fifteen hundred cars off the road for a year.

So that is kind of the scale that we're looking at from this type of policy.

So that point one percent was specifically to heat pump to AC conversion?

Yes, would it represent 1,500 cars off so I thought the original memo had a point one when it was all of the items included in it.

So now if we move specifically just to heat pump conversion, you're saying it's still is the same exact climate impact?

So there's actually not a direct greenhouse gas emissions reduction from the electric ready portion because it is preparing for future, you know.

So it's not it's not the actual equipment change out, so we don't include a um uh emissions reduction for that portion, so it doesn't change.

So it'd be clear the number was 0.01 or 0.00.

What was it exactly?

Uh I think it was 0.01, right?

Yeah, percent.

And that's not even clear that that's the actual number.

And then when you talk about the savings, it's up to 300 and 350 dollars, but we say as if it's just a given, it's gonna be 300 and 350 dollars.

So again, we're impacting folks' budget and their finances, and we're being willy-nilly about the numbers just because we want a virtue signal and say we're a climate smart city.

So for those reasons, I will not be supporting the nudge.

Thank you.

Sorry, just a correction, it's actually 0.1% for the uh community-wide missions.

Thank you.

Thank you.

Thanks, Councilmember.

Let's go to Councilmember Ortiz.

Thank you, Mayor.

Uh I want to thank my colleagues for their memo and everyone who's spoken already.

I also want to thank staff for their hard work and diligence uh in pursuit of uh making sure that we can pass on a healthier world to our youth.

Uh addressing climate change is an important endeavor and one that I support.

Uh we need to make sure that the decisions we make today put the wills in motion to create a better and healthier world for our children.

Uh that being said, I think it's important as policymakers that we hold the correct populations accountable who are responsible for climate change.

I want to make sure we're thinking very carefully about the real costs here.

Because if we don't, those costs will end up being passed down from homeowners to renters.

So I do have just uh some questions for clar clarity.

How many households in San Jose would be directly impacted by this change?

So at maximum, because we have 185,000 approximately single family um buildings, that's the kind of at maximum.

But of course, there's only you know, there's a life to equipment, and so um I think we uh someone mentioned a 20 year life.

We typically look at it like around a 13-year life for um the AC, so if you kind of you know build that out, that's how we look at the greenhouse gas emissions reduction.

But at the same time, I guess looking at reality of what permits come through.

I mean, um the planning department has um told us that the there's around 1,200 AC permits that come in through through their or at least came in in the last couple years through their office so per year.

So that's you know, so it's a range.

So like it could be twelve, you know, twelve hundred, it could be, you know, it depends on who how many come in and so only 1200 houses in the city of Santa Cruz.

That's how many permits have come in for AC replacements from according to the planning department.

So that's you know, that would probably be like the low range of it, and then it could go up to the um, you know, the port the total number that could be changing out in a year, but it would apply to all single family residences, and that's 185,000.

That's what I okay.

That was more the number I was looking for, which is a lot of a lot of family residents.

And I know that there was a comment that mentioned um that if you make less than 180,000 dollars, that this doesn't apply to you in theory, but what if you're a renter, like I am, and your property owner uh may be wealthy, but you're not.

And as we know, in many cases, you know, landlords have pushed the cost of things like this to their tenants.

Um, so how do we how could this not be an unintended rent increase for a lot of our renters?

Yeah, I think that's a good uh comment.

Um, you know, as anticipated, we anticipated that the the low income exemption would apply to the property owner, not the tenant.

And so you're right, there could be unanticipated consequences.

Okay.

So I just want to make sure that we're talking facts here, and so to say that this doesn't impact low-income people is just not true.

I I represent District 5 where there's a lot of renters.

I'm a renter, right?

And so I just think people by categorizing people who may be skeptical about this pop uh policy as being in the pocket of some sort of landlord lobby is very offensive to me.

If any if anything, I've been enemy number one to the landlord lobby, just to be to honest with you.

And so I just take offense to to comments uh uh like that, because at the end of the day, uh I have lived paycheck to paycheck all my life.

I've had lived in a home that was foreclosed, and it's not just black and white like that.

Not saying that people are bad for wanting to do this.

I understand why people want to do this.

I just want to make sure we're getting real answers and talking about real facts.

Um, and so just for the record, how much would it roughly cost for single family for a single family home to comply with the recommendation?

So it's important to note that this is triggered when you're replacing your existing AC or you're adding a new AC, and our staff analysis is that the incremental cost on that is somewhere between $750 to $3,500.

$750, just a one-time fee $750.

That's the incremental cost of an ACE of a heat pump versus just a normal AC.

Okay.

And do the rebates that are available, does it fully cover the cost or what what are we looking at to be the overall cost out of pocket?

Do you want to answer that question?

So the in order to receive an incentive from the rebate programs we listed, ours and the state's program, you need to install a high efficiency heat pump.

So that's a higher incremental cost.

So it's not even available for every every sort of replaced unit.

It's only for a specific type of unit.

Well, it's a yeah, a higher efficiency system, which costs a little bit more, but you're able to stack rebates right now to fully cover that cost, and um also you have higher bill savings as well.

Okay, and so there's potentially 180,000 homes roughly of that that would be essentially held accountable for this.

How many rebates are available?

Is there an idea?

Under our current rebate budget in eco-home rebate, we have a budget of 2.675 million.

It could fund 590 heat pump installations.

Um, 590 out of 180,000.

Okay.

All right.

All right.

It's important to note that that that's in any given one year.

And so as Julia's pointed out, um, typically what planning is seeing is about 1,200 permits pulled for AC.

We have funding in our program for about 600.

We are recommending some program changes to allow that funding to go a little bit further, and we could come back to council if we're seeing um an increased uptick, and and obviously that would be your decision to um approve those funds.

And then I would say that the other rebates that are available are through the state, and and I'll pass it to Kate to talk about that program as well.

So the tech clean California program has been around for several years now.

Um, it um starts and then kind of stops funding periodically, so it's not available continuously, but they have multimillion dollar budgets, and um, you know, several thousand homeowners in California have utilized that program or funding right now.

The incentive amount is up to $4,000 for an HVAC system.

Thank thank you.

I don't want I want to make sure you know you understand that my I don't want my com comments to sound condescending.

I understand you guys were directed to do this report.

I'm just doing my job as a council member who represents a very working poor community to make sure I'm doing my due diligence.

I just want to, you know, end that say, like, you know, if our council is serious about climate goals, I think we're putting the the burden on our our residents instead of looking at industries that are bigger drivers of emission.

You know, we we're we're doing the city of San Jose is doing incentives for AI and data centers that consume enormous amounts of energy for the record.

I support work in those businesses, I support jobs, but it's just it's to me it's a little disingenuous to come after our residents when the real cause of climate change has been industry over years and years.

And so I want to support climate action, and I I you know I I support my colleagues, you know, who vote for this.

I just I can't in um good conscious uh vote for this because I know that families will be displaced when this passes.

Thank you.

Thanks, Councilmember.

I appreciate the good questions from you and Council Member Casey.

I think they're very very valid.

I do want to clarify though, if staff could just confirm the data we have for San Jose, is that it is not data centers, it is specifically buildings, and I think Councilmember Casey has some helpful questions about the breakdown, but buildings and transportation are the two.

Can you just restate for everybody here and then we'll get on to other people's comments and questions?

But I just want to note to Councilmember Ortiz's point for San Jose for our own plan for trying to reduce the carbon intensivity of our use, what are the main contributors?

Just so we have the facts on that.

Yeah, so buildings represent about a third of our community-wide greenhouse gas emissions, and you're right, the other the other the largest portion is transportation, which is around 50%.

So about 50% of emissions in the city are from the transportation sector, and then about a third are from the built environment.

San Jose is very residential heavy.

So it would probably be good.

It's been a while since we've done a deep dive on.

I just want to respond to that, Mayor, since you did mention my comments.

I think you're right.

Absolutely, in San Jose, but in other areas and in other regions, AI and these and these data centers are causing a lot.

And I'm not saying let's ban them.

I support working in there.

I just want to make sure that we're looking at the total picture, and I just don't think it's fair to come after, you know, those single mom in my district when there's people who are making profits off of things that impact.

Understood.

I'm just noting our in a that'd be outside of our jurisdiction, not you know, can't regulate the Texas uh oil industry, but I hear I hear your point.

Okay.

Um let's go to council member Campos.

Thank you, Mayor, and thank you, staff, for the report and for all your work on uh bringing this um before us today.

I uh did have just some questions about um the proposed income-based exemption.

Um, so in the supplemental memo, um indicates that staff updated the proposed REACH code to include an exemption for homeowners whose household income is up to 100% of AMI, can staff please clarify if that exemption will be based on the income of those that are listed on the deed only, or if it will be based on the income of all individuals that live on the property, so I think typically when you have these cyber programs that are looking at um an income-based limitation will um it'll be based on the homeowner, so yeah, whoever's coming in to get a permit for the AC replacement.

Okay.

I mean the AMI is based on a number of people in a household, too, so that does come into play.

So thank you.

I'll I'll clarify um on that question.

If the legal property owner, um, as council member Ortiz mentioned, right, because sometimes homes have renters in them, or um, you know, we have multi-generational uh families living in homes, so if the legal property owner meets the income exemption, but the total household income exceeds a hundred percent AMI, would that property still be exempt from the REACH code?

So this is the example where the homeowner maybe is on social security income, and so they might uh reach AMI, but the household capacity has capacity to you know make the investment and they will qualify for an exemption.

How how have you thought about addressing that?

Yeah, it's a it's a good question.

Um, you know, as I stated before, we'll we'll continue to work on these implementation um details, but you know, I would say we would more than likely rely on who the homeowner is and make the determination on that versus all of the the residents in the family, but it it's a good question, and and we'll continue to work on that.

Thank you.

Um is staff aware of any other jurisdictions in California that has an income-based exemption from building code requirements.

Yeah, it's it's not common, but there are a few.

Um, you know, for example, San Francisco in their electric ready, they did exempt affordable housing, and and we know of at least one other city that had an income, but it is not common.

Okay, and my um just a couple more questions.

So is the building division appropriately resourced and equipped to implement and enforce the income-based exemption that's proposed?

I'll defer to Chris Burton, our director of planning.

Thank you.

Thank you, Councilmember.

Uh Chris Burton, director of planning building code enforcement.

I think uh certainly as Lori mentioned, there are some additional details that we'll need to figure out as far as uh how we're applying these standards for exemptions, and then that would fall onto the fee program.

So we'd have to figure out sort of whether or not that uh indicates additional time allotted to individual permits, um, and then the cost of that would be passed through the permit cost to the homeowner.

Okay, thank you for that.

My my last question um is if staff could please help clarify how broad the exemption would be.

So, for example, if a property owner who does qualify for an income-based exemption, demolishes their home, builds an entirely new home, would they still be exempt from the REACH code requirements?

So I think the question was how broad would we apply the low income exemption?

And the example is if they demolish their entire home, would they still qualify?

Right, because the spirit of that question is if someone can afford to demolish and then rebuild an entire new home, but yet they qualify for this income-based exemption, how are we thinking about that?

If somebody's demolishing the entire home, then it would fall under different provisions because it would be new construction at that point.

So we know that so and I think it's an interesting point that you're raising.

Typically, as people sort of remodel within their home, there may be different sort of levels of work that they're doing or different scopes of project.

Uh typically, as we look at AC replacement, it's a relatively simple permit that's issued online.

Um, you know, if this was wrapped into a bigger project, it would likely be coming through plan review.

So we we'd have to assess at what point you know it qualifies and which requirements actually uh would be applicable to the project.

Thank you.

I know um this is uh iterative process, and I look forward to hearing comments from my other colleagues.

Thank you.

Thanks, Councilmember.

Let's go to Councilmember Condelas.

Uh thank you.

Thank you, Mayor.

Uh, I you know, uh first of all, thank you to staff for bringing this item forward, and um also want to thank the the folks in our in our Brown Act uh for the collaboration in in trying to work through through something that we we all everybody here should have a vested interest in, and you know, um, you know, I I too, you know, uh am mindful of the economic impact any potential city action has on our families.

Uh you know, it's it's an important part of this dialogue, and and I guess I have a question for for staff is you know, can you talk a little bit about what action the city uh is proposing to take with regards to the the AC to heat pump conversion uh to ease that burden for for our lower income residents, if you will.

Yeah, so first of all, um in the supplemental, um there's the exemption, as we talked about.

Um, but I think you know, we'd also first and foremost really want to work with our residents and and make sure that they're aware of all of the rebates that we have available.

So through San Jose Clean Energy, as Kate mentioned, we offer rebates 2,500 to 3,500.

We also offer 0% on bill financing up to $5,000.

So those are two programs that residents can take advantage of through San Jose Clean Energy, and then in addition to that, there's additional statewide rebates that low that all customers and in particular low-income customers can take advantage through the state tech program, and so that's up to an additional $4,000.

But for everybody, I believe that's a thousand dollars.

Correct me if I'm that's correct.

Um so through San Jose Clean Energy at a very minimum, um $2,500.

The state gives you another thousand.

You can also access $5,000 zero interest on bill financing for that additional incremental cost to make things more affordable, and then if you're a lower income, you would qualify for additional rebates and incentives.

Got it.

No, thank you thank you, Lori.

So it's so we we we have uh grants, if you will, re uh in the form of you know the the program structure.

We also have zero financing loans, if you will, to cover the delta between traditional AC and what we're proposing and the with the incentivizing of heat pumps.

Look, I also represent Eastside San Jose.

I have uh I know for a fact that we have a good amount of homes in our in our in our overall housing portfolio uh that don't have AC.

Historical trends, they don't have air conditioning.

A good amount of our our rental housing portfolio is in East San Jose.

I recognize that.

Um, you know, the action today is specifically for for folks uh when when your ACU, look, first of all, for everybody out, my dad does heating and air conditioning.

I actually have installed with my dad uh uh a heat pump.

I have installed the traditional AC.

And and you know, don't let the suit fool you.

I get underneath the house and I run and I run uh the the the the the things needed, right?

And so what we're doing specifically today is when you have your AC unit that goes out, and we know that um in 2029, you're not even gonna be allowed to have a traditional AC unit because you're gonna be forced to update your your AC system to a to either a heat pump or or uh or or well if your furnace goes out you're you're stuck that's what you have to convert to but what we're what we're doing is we're thinking ahead so folks don't have to invest two times in their to update their air conditioner now to something like a heat pump and then if their furnace goes out in two three years they have to replace their their furnace again and so you know I think it's important to think about the fiscal implic implications that any unexpected expense has on folks but that's why the rebate is important and that's and that's why the conversation on the fiscal piece is important and um and and I think you know it's it's it's a moral imperative that we're talking about here.

But we're also putting dollars in our programming to make sure folks can cover that delta because you know if you have to replace your AC you have to replace your AC.

And and and I think there's there's no way no no way around it if we can make that that conversion to something that's more environmentally friendly more efficient and quite quite frankly better for for your home by by incentivizing that through the programs that we have in our in our in our in our city I I I think this is one of those those those common sense things that we can do and and you know it's I don't think it's creating an overcumbersome mandate we have exceptions.

Staff has worked hard on those exemptions to think about you know if you can't afford it you're on a fixed income then then you we have exemptions in in in what's being proposed now the self-certification piece and the nuance on the on the administrative piece the you know that's that's something you know I I'm gonna be tracking and we'll see how the the decision comes comes out with the rest of my colleagues I'm interested to hear but you know to say that we need a stricter or we're we're we need to see somebody's IRS forms you know if somebody you know if somebody if you are accessing our PRNS programs and you need a scholarship for your kids we don't mandate you prove that you're low income.

We don't mandate you prove through whatever form that that you you need that assistance and so I think it's it's you know it's important for us to to think about those things um and and you know I think we can if we can shield to the cost to those who don't have the luxury to for to afford those changes um with with our program I I think I think it that there's there I think having those AMI exemptions and those exemptions that we have codified are are important enough and I and I hope my my colleagues can consider the importance of of this um of the the time uh to be able to take action now and not just say oh you know uh we we don't need that or it's or it's too cumbersome or it's too now's not the time everybody I I I don't I don't buy that and so um I appreciate staff's work and and I appreciate the the comments from my colleagues and and posing those serious questions on like what's this going to actually cost and and so um yeah uh I'll I'll done I'm done talking for this round but I may say a couple more points that I I have lined up thank you.

Thanks Councilmember let's go to council member Tordillos.

Thank you mayor and thank you staff for all the work to get to this point and to all the members of the public who came out to unanimously support the proposed reach codes today.

There's been talk about you know making sure that we are governing based on evidence.

So I wanted to just start by reinforcing the necessity of actually electrifying our existing building stock staff has already pointed out the fact that one third of our greenhouse gas emissions comes from our existing buildings and the UC Berkeley memo or uh study that was cited in our joint memo uh points to the fact that heating electrification is the single biggest non-transportation related uh policy uh item that we can use to reduce greenhouse gas home gas emissions in San Jose specifically uh and I'll also just read briefly from the United Nations intergovernment intergovernmental panel on climate change uh from the recent sixth assessment report uh where they say with high confidence that electrification of most buildings is expected in net zero energy systems uh that space cooling and water heating are expected to be largely electrified, and that building electrification is expected to rely substantially on heat pumps, which will help to reduce uh lower emissions and both through reduced thermal requirements and higher energy efficiencies.

So I think it's very clear that we need to move over time towards electrification of these end uses, including heating.

And this will also have the add-on benefit of improving local air quality by no longer burning fossil fuels at the local level, something that I hope we can all get behind here.

Again, just on the impacts of this policy.

And this policy will result in a community-wide reduction of over 6,600 metric tons of greenhouse gas emissions.

That's a difficult number to reason about.

So I put it through one of DOE's converters just to kind of better contextualize.

And it's equivalent to the greenhouse gas emissions of burning about 7.3 million pounds of coal or driving 16.8 million miles in an average gas-powered vehicle.

Also equivalent to the carbon sequestration potential of planting about 110,000 tree saplings over the course of 10 years.

I think hopefully we could agree that we if we had a policy available to prevent burning 7.3 million pounds of coal in San Jose, that we would take that option in order to invest in our climate future.

You know, we have 185,000 single-family homes in San Jose, 78% of them have AC.

These are buildings that over time we need to plan for how we're going to electrify these buildings, and I think that this policy really presents an opportunity to take a step in that direction.

That said, I'm sensitive to the economic concerns here.

I think we need to take them seriously.

But I believe that this memo that we've already uh come to does strike that balance.

We focused solely on the AC to heat pump conversion mandate.

We've removed directives around pre-wiring and preparing for electrification in response to concerns about ambiguity and costs.

We've included exceptions for lower income families, and we've included exceptions for conversions that would necessitate necessitate electrical panel upgrades.

So I think we are being very mindful in how we approach this.

At the end of the day, we have a climate goal, our carbon neutrality goal that we are trying to move towards.

And we are trying to do that thoughtfully, and I think that this memo strikes this balance.

Finally, just want to point out that I think that this proposal shows that there's actually potential to save residents money.

You know, the staff report notes the potential for thousands of dollars of full lifetime savings with these systems, opting for a heat pump over an alternative system.

And we can also look at direct experience from cities that have had programs like this in the past, like Seattle, which actually looked at this and showed thousands of dollars of savings from utility costs from families that converted to heat pumps.

And the Rocky Mountain Institute looked specifically at utility costs in Santa Clara County and showed an expected savings of $360 a year on utility bills for folks who upgrade to a heat pump.

So, final component here is just the I think elephant in the room, which is the 2029 date of which the Bay Area Air Quality District regulations will kick in, preventing folks from even purchasing new uh natural gas furnaces.

And I think we have to be mindful of the other outside of San Jose regulatory environment here.

And I think that this proposal has the potential to again save folks money by allowing them to be more proactive and preparing for that ban on gas furnaces, preventing people from making investments in a traditional air conditioning system tomorrow, only to see their gas furnace go out in 2030 and have to invest in a heat pump anyway.

I think that this is a thoughtfully designed policy that can save residents money, that can make real progress in advancing our climate goals.

And I think that we've been very careful in terms of how we look at the economic costs here to prevent things like displacement.

I think that that is an important consideration to make, but I don't think that a relatively small incremental cost to move to a heat pump over a traditional AC unit when we have rebates available to cover the entirety of that incremental cost and 0% financing, I don't see that as an overly burdensome mandate here.

And I think that this memo really is something that can make strike that balance between making progress on our climate goals and taking seriously economic concerns for our residents.

So I hope that my colleagues will support this.

Thank you.

Thanks, Councilmember.

Just before I come back around to folks who've already spoken, let me make sure I've gotten everybody else.

Councilor Kamehameha, have you spoken yet on this item?

I don't think so.

Go ahead, you're next.

Thank you.

Um and thank you for for the report and information.

I know that we want to uh achieve our climate goals, and and this is a way that we can try and do that.

Um, you know, I want to pick up on something that council member today has just said.

Um our rebates will pick up the entirety of the incremental costs.

Is that correct?

I think it depends on the type of heat pump that they install.

So our rebates are available for higher efficiency heat pumps, which are typically more expensive, they're gonna be in that 3,500, and so our rebate for all residents is 2500 for lower income, it's it's 3500, and then we have an additional $5,000 on bill financing, 0% interest program as well that's available to everyone.

Yeah, so you know, I I just googled um uh you know heat pump costs and you know uh installation and all of that, and the range is huge.

It goes from 6,000 to 25,000, and I don't know what kind of information uh they're spitting out there, but but um, you know, uh in some cases maybe it could be a higher cost.

I don't know if it costs more for the uh the um um, you know, the labor and whatever is needed, and whether or not if it's single family or if it's a duplex or you know, whatever it is.

Um, and so you know, I I was just wondering, um there are there are uh economic impacts, um, and uh I'm just wondering why it was thought that a mandate was better than making it voluntary.

Yeah, no, thank you, council member, for your comments.

And I just wanted to clarify um there's numbers that I'm saying that 2500, um, you know, what what we're talking about there is the incremental cost.

So, you know, this code applies to if you're switching out your AC and installing a normal AC typically is gonna cost you, you know, probably 10, 12,000.

And so when we're talking about the additional cost, we're talking about those incremental above that, and and and then comparing that to what the rebates are.

But to your question around, you know, why are we not just letting the market uh decide this and just offer um rebates and and why are we doing a reach code?

And so, you know, certainly we think we need multiple strategies to meet our climate goals.

We we have had our heat pump program for for almost a year now, and so um obviously that's one strategy that that we're hoping to to do more of, but the reach code can help us go beyond that to meet our climate goals, and it has traditionally been a policy that uh council has supported and um you know has been effective in terms of reaching our climate goals.

Okay, thank you.

Thanks, Councilmember.

Let's uh now go to Vice Mayor.

Thank you.

I'm not really sure that answered why mandatory or and why not voluntary, and and I know there's been a lot of information about the rebate covering the cost or not covering the cost, and and the factor that over time it will be cheaper for someone to swap out their AC for a heat pump, and there'll be cost savings over the long haul, but the number used is 30 years.

I wonder if our senior, you're you're shaking your head, but that's what the report said, and that was what the briefing was that you gave to me was 30 years recovery.

And and when I look at that, let me just finish my point.

If I could, senior citizens aren't gonna look at a 30-year recovery.

I'm 66, I'm not gonna look at a 30-year recovery.

I'm gonna look at maybe five years or or whatever.

The I see a lot of concerns.

I I appreciate my colleagues' discussion around this, their support and their opposition for various reasons, and I'm sitting here still being thoughtful about the position.

I'm concerned about the mandatory nature about it.

I'm concerned about the cost of the permits that will be required and the whole cost of the uh putting in a heat pump.

Chris, can you okay?

I'll give you an opportunity to respond about the 30 years since that's what was originally stated, and are you saying that's not accurate?

Yeah, no, I and my apologies if um you know I missated or you misheard me, but I I think you're referring to page five of the menu of the memo, which says that life cycle cost savings represents various assumptions in gas price escalation rates over 30 years.

So what the analysis did is looked at the lifetime savings of a heat pump, which is typically 15 years, but they looked at what gas prices may be over the next 30 years, as they did with electricity prices.

So that's where the 30 year came from, and you know, my apologies if there was confusion around that.

And so in the memo, the cost savings are over that lifetime of the equipment.

That's what the consultant study did.

And I believe they're here today if you had additional questions on the consulting study.

Okay, so you're saying the equipment has a life cycle of 15 years.

Okay, well, even that.

I'll use you again use my senior citizen as a reference point.

Someone who's 80, who meets doesn't meet the income threshold, so they're they're lucky enough that their pension pays there, the retirement pays them more than 200,000 or whatever the 180, they have to swap out the heat pump, and over 15 years theoretically, they would recover the cost.

Is that right?

Yeah, recovery.

And have additional savings.

So in the report, depending on the efficiency, the the lower efficiency one has an incremental upfront cost of $700, but can save up to $10,800 over that total life cycle, which is that 15 years.

Um, and then the higher efficiency um, you know, can cost anywhere from $1,700 to that $3,500, but has um similar lifetime savings.

Okay, great, thank you.

I would also note that uh comment was made about the amount of rebate is available and how many homeowners might be able to benefit from that.

And I wrote down the number 509, there's enough for 590 homeowners yet.

The need is much greater than that.

So I'm really concerned about the the economic impact, but I do want to say that no one should really credit uh question my um support of Climate Smart.

I was on this council when we adopted the climate spark policy.

I brought forward the transit first policy.

I was involved in the vehicle miles traveled policy and the carbon neutrality policy in 2030, also uh supported standards for restricting natural gas in new construction.

So the fact that I may or may not support this should not indicate to anyone that I don't believe climate support climate smart or climate is in jeopardy and climate smart is not the direction we should go.

I absolutely do.

I'm concerned about a lot of the questions I have and we haven't really even talked about the workforce and the availability of the equipment.

Now we did just prior, just prior to this, we passed a memo approving a workforce policy, which is great, but it's gonna take us some time to get the workforce trained to be able to install all of those units.

So that's one issue I'm grappling with.

And then Chris, maybe you could talk me through.

I'm getting uh air condition I have an air conditioning unit, and I need to replace it now with a heat pump.

You said that I get the permit online.

How are you going to know if I have an income exemption?

Um that's an excellent question.

Um as Laurie mentioned, part of the uh implementation is what would need to be worked out relative to this.

So you're absolutely right that currently uh either the AC or you know a a heat pump would be pulled as an online permit.

That's something that we've done to streamline that process so that homeowners can get the work underway, and really our first interaction with that homeowner is when the inspector's on site, once they've already begun the work.

Um so in this instance we'd have to look at either sort of really clear notification up front that somebody pulls that permit so they're aware of their requirement, or we would have to uh consider sort of pushing them into more of a traditional permit process.

Which takes more time and more, and if someone needs to swap out their air conditioner because it's gone down, it's broken and it's 90 degrees outside, they don't want to wait that longer time.

Okay, so uh what about the um electrical panel exemption that exists too, or is part of this, right?

That if I need to uh upgrade my electrical panel, there's another exemption, isn't there?

Yeah, yes.

Uh both the AC to heat pump as well as electric ready components of the reach code have an exemption if um meeting the reach code would trigger an electrical panel upgrade.

Okay, so how how does that work then?

So I have an AC equipment, went out, um, I'm going online, I have the income, I don't have the income exemption.

Well, it doesn't matter.

Uh well, yeah, it does actually, because if I had the income exemption, then I don't have to install the heat pump.

But I say I don't have the income exemption, but I need to upgrade the electrical panel.

Another exemption exists, correct?

And how does that work?

How am I notified of that?

So I think it's the same issue as any of the exemptions.

You know, there's a process to be worked out uh through the permitting process to figure out how we would do that.

Um I don't know if Chris, you have any.

There's been uh from what I understand, there are other um codes that perhaps there's you know exceptions to, and so it I'm imagining would be similar to that process.

I guess my point is in trying to get down to the nitty-gritty of this a little bit, is figuring out how the individual homeowner is going to navigate all this, and the difficulty in the process, and and you're asking us or this this proposal is to adopt something that doesn't have all the details worked out yet.

So are the details coming back to us to be worked out later?

How when will we see how they're actually going to be implemented?

I think that's part of that's part of my um concern on this is the lack of detail on how it's actually going to be implemented.

Yeah, so maybe one suggestion is that we could come back to council as part of our climate smart updates on this and and report out how we're implementing this reach code and um another possible solution is we could do an informational memo as these details get worked out so that you would be informed of it before January when they go into effect.

Okay, didn't we just have a climate smart update at T and E?

We have one coming in October.

Oh, we do, yeah.

So is it possible to include that at TNE in October?

Uh we can try.

Um, that's coming up very quickly, but but we can certainly try.

Okay.

Um I really appreciate that.

And I see that my time is up because my light is flashing, so I will turn over the microphone to someone else.

Thank you.

We can always come back to you.

Thanks for noticing.

Let's um, so I think we still have not heard from Councilman Dewan on this issue, as I recall.

We we do have some folks who want to speak second time, which is great.

It's been a really robust conversation, I think productive.

Let me go to Councilmore DeWan next.

Thank you, Mayor.

Thank you, staff according to Forbes um replacement of a heat pump could run on the average in a nation around $10,000.

Now there's a difference between a single unit and a multiple units that could run up to 20 or 30 thousand dollars.

Now I stay with my parents and well my dad now and his house doesn't have air conditioning and his water heater is is actually the older style and we don't have no electrical near there if I were to upgrade to a heat pump meaning I have to run or hire somebody running from the panels over to the new heat pump that costs a lot of money.

And you know I I could technically I pay thousands of dollars to to have an income and an in-home care to take care of my father I don't have the extra funding to have a air conditioning unit or heating unit in there or you know I've always wanted a Lamborghini but I drive a lamborola if you will because I own a Corolla because I can't afford a Tesla if you will and if I own a Tesla then I got to upgrade my panel in order to have the electricity and perhaps even the you know um the uh solar panel to to supplement so I think it's it's important that we we our biggest population or right now is the baby boomers and I there is more baby boomers out there whom barely support themselves at their own homes or even an apartment on SSI and any type of upgrades or even permitting is cuts into their daily living meaning food shelter and I think we have to look at this in a different way.

And I'll make it clear I support really do support undoubtedly the cleaner environment you know the future for future generation but we we shouldn't you know mandating someone into doing it versus encouraging them to because technology eventually forced people to change just like years ago I I didn't want an iPhone and or a smartphone I I stuck with the flip top phone and the flip phone until eventually I you know I got my I6 and then now I only got I 11 of course now we're up to what I six seventeen oh my god I'm behind time.

But I think it's important even with the rebate it is and the rebate doesn't guarantee you know you you get up to 3500 and the in the state up to four thousand it doesn't it doesn't give you the full amount and therefore you know you're not going to be able to recover the cost and again every single burden that's come with out of the pocket of residents and I care tremendously about our elderly and I understand our younger generation want to be environment environmentally friendly but they don't bear the burden of taking paying the rent which is on average now is 50% of their income on top of the taxes and and everything else on the rise including when PG needs gonna upgrade their their electrical lines and and it's forces the resident to upgrade their the electrical panel that costs $15,000 to $20 thousand dollars.

So I, you know I I'm looking for solution that we we encourage people versus mandating our our citizen, especially our underserved citizen whom doesn't have the funding to do this.

Thank you.

Thanks, Councilmember.

A little staff felt uh for an desire to respond to those comments.

We keep moving.

Okay.

Let me come back around to Councilmember Cohen.

I'm gonna start by apologizing because I have some passion on this issue and I might say some things that bother some people, but I have to say it.

Our younger generation bears the environmental burden of the choices we're making.

So to say that the younger folks want a clean environment, but it's just too much for us to give it to them frustrates me.

We all say we support a cleaner environment until we have to do something about it.

But that's why we're in the situation we're in.

All furnaces have power next to them.

They run on electricity and gas combined.

You can't run a furnace just on electricity, you have gas.

They're powered by both.

So this is not about the uh in putting in a heat pump, which should also, by the way, be put in where your air conditioning unit is, not where your furnace is.

It has not there's no electrical wiring requirement.

I know many people who have experience getting heat pumps.

I don't want to name names, but their experience is that even in 50-year-old homes, they're not upgrading their panels.

The wiring is great, they're saving money, they're using less electricity, which actually reduces the burden on their panel.

It's good for them.

The idea that somebody might lie to prevent having to put in better technology, okay.

You know, I I'm oh I'm okay if that happens.

I would be disappointed.

But first of all, I trust the majority of our residents to do the right thing and not to lie.

And I don't want to think that the default posture of our residents is that they're gonna lie because they don't want to spend the slightly higher incremental cost.

Secondly, even if some folks do fall through the cracks by lying, that shouldn't stop us from implementing good policy.

If this encourages more people to convert to heat pumps, it is good for our environment, it is good for our climate mitigation plans, it is good for our carbon neutrality goals.

And finally, I would hope that people who are thoughtful on this topic wouldn't say, I prefer not to save money on my electricity bill, so I'm gonna lie about my income so I can spend more on my electricity bill.

And I want to go back to what the numbers that that Lori was talking about.

Over 15 years you save $10,000 on your electricity bill.

And the numbers, thank you, Anthony, for finding the numbers on this county, average of $360 a year savings.

15 years you save about $10,000 on your electricity bill.

If in fact you end up spending $3,000 extra or $4,000 or $5,000 extra on a good heat pump, and you get a rebate between the state and the count and the city of $3,500, your $1,500 in the hole, that's a five-year payoff.

That's not a $15-year payoff.

There's a savings then beyond that point.

It's not a 15-year payoff.

It's a five-year payoff.

So I hope people we can educate people to understand that.

180,000 homes are not replacing their air conditioner next year.

What I heard from also from Lori is that there were 1,200 permits over three years.

That's 400.

Was that number?

Was that correct?

Maybe Chris is looking at me, I'm not sure, but over it wasn't 1,200 per year, right?

So uh I'm I'm not sure.

So what we have in the Pembroke system is roughly $1,500 a year.

$1,500 a year, okay.

So $1,500 a year.

We can cover, you know, we'll we'll, you know, many of those folks are probably doing it regardless of, you know, rebates, but some will ask for rebates.

We can cover half of them.

We also have other sources plus the five-year financing plan.

If the homeowner of a rent, so but let me just go back to the basics here.

The reason this is triggered is because you're replacing or installing a new air conditioner, not because you are being forced to do something otherwise.

If you are, if you're if you are a renter and your air conditioning unit dies, you expect your landlord to come in and replace it, or, you know, or not.

I mean, that's up, you know, you can make that decision.

If the air conditioning dies, that'll be about a ten thousand dollar cost for the replacement of the air conditioner without doing a heat pump.

The incremental difference is about three thousand dollars.

But the question here is whether or not the home, the the property owner will then pass on the $10,000 cost of the of any replacement air conditioner to their renters.

Um the three thousand dollar cost has potential for rebate and with and with financing, the ability to spread that out over five years, the cost of that.

So you again, I just want to make sure people understand the baseline here.

The baseline here is that somebody is going to be spending $10,000 on a new air conditioner, whether it's a new installation or a replacement installation.

And the question here is about when they do that, is the incremental cost for our environment.

The point here is the collective impact.

So $500 a year, $1,000 a year, the collective impact of us getting another hundred that wouldn't have happened before, along with Palo Alto and Sunnyvale and Menlo Park and San Francisco and other cities that do this, is the way we deal with climate change.

And we have to make a decision.

We're at an inflection point.

Actually, we're at an inflection point 10 years ago in climate change, but we're we're sort of always at this inflection point where we have to make the decision about whether or not this incent this requirement will help us move that needle.

90% of the buildings in San Jose are homes, is that about right?

I mean it's a it's a it single family homes are the bulk of the buildings in the city of San Jose.

So it's important to me to um, you know, it's important to all of us to focus on the bulk of our housing stock, and that's what this item does.

Now we can talk in future about whether or not we need to also figure out ways to improve incentivize other types of buildings as well.

Data centers, by the way, and that are being solved in our city are using 100% clean energy.

They're not, and and this issue about climate change is about burning fossil fuels.

So the question of the burning the burning of fossil fuels is a separate question from large energy users, obviously, in our community.

And we have we should be very we should hold our um companies coming in to build data centers to a high standard on how they use do energy efficient design.

So I I while I in the last few minutes that I have, I did want to ask our consultant uh who's here um far head to come up and just give a little bit of context on um, you know, on this the incremental cost question and what you learned about about this based on the work that you've done.

Uh thank you, council member.

Yes, uh that's correct.

Um so the trigger is when you are installing an air conditioner or replacing an air conditioner, which is in itself uh 10.

Sometimes if you have a larger home at $20,000 cost, uh heat pump would have an incremental cost on top of that, roughly between what we've seen, uh, you know, staff analysis pointed out was $700 to $3,500.

Uh your neighboring uh uh CCA Silicon Valley Clean Energy actually sees lower costs for heat pumps than AC plus versus because it's at one compressor that goes two ways versus a separate furnace plus that compressor combined.

And so if you have a uh workforce that's well trained in these, they actually see lower costs they're less doing doing less training on the job and actually are able to perform that work more efficiently.

Um I do want to provide a small correction.

There are two cost of uh cost studies that were done.

One was by Peninsula Clean Energy and Silicon Valley Clean Energy, and that's where the bill savings came from of around the $300 to $400 there was pretty close to RMIs.

Um but uh there's a second statewide study, the IOU study that um has a 30-year cost effect in this time uh horizon.

And so there was one the PC SVC study was 15 years, and that does show bill savings.

And um I believe uh that is correct that you actually do pay back uh in advance of 15 years as was a concern.

Um, the 30-year payback is also it's it's you know over a 30-year time perhaps you're also paying back ahead of 30 years.

But there are two different studies, one with a 15 year and one with the 30 year.

I just want to clarify that.

Great.

Thank you so much for the clarification.

All right, thank you.

Thanks, Councilmember.

We're gonna council member McCasey.

Thank you, Mayor.

Uh, what's been grading on my ear in this conversation is how fast and loose you guys are with other people's money, and a complete lack of understanding of time value of money.

You chose to say $700 and a $10,000 savings when discussing with Mayor, uh, I mean Vice Mayor, you're gonna say that we're guaranteed a $10,000 saving if we get a heat pump.

Is that a guarantee?

No, I'm not saying that's a guarantee.

That's what the cost effectiveness study showed.

Okay.

So the idea that we're saving money is a is a complete lack of understanding of what money is.

If I'm putting $3,500 up front I can invest that in a fund I can get some sort of returns.

You're not saving me any money.

You're losing me money.

That money opportunity cost of me putting that money into into work for me is going to return much more than that $10,000 or whatever the speculative amount is.

Secondarily timing wise if we were to say yes today how soon would this be implemented?

January 2026.

January 22.

And you're telling me between now and January 2026 suddenly you guys are going to figure out how to assess whether or not someone is AMI at 100% and we haven't even heard even a a menu of options that you guys have available to yourselves now.

Yes I think that's an implementation detail we can definitely answer before the before it would go into effect.

And in terms of staff costs I did ask you that in our briefing and you guys did give me an estimate but we really don't know what the staff cost is going to be to implement this as well right.

We do have an estimate which we provide you this morning and um if I recall about eighty five thousand um which the majority of that was to develop the reach code which has already been spent but Julie can you talk a little bit more about that yeah were you interested in um solely the implementation portion of it or the just the staffing cost of yeah implementing the staffing cost for implementation okay yeah so I think um if the reach if the proposed reach code is um approved then we would anticipate and this is pretty standard with just even building code and we've done this previously with reach codes where we would want to do city staff training we certainly would want to do that before January.

I know there's also a typical planning um training that happens for the community and and probably for staff too following that which we would also participate in so that's part of the implementation costs there's a couple of our hours around that.

We've also already met with with planning staff to start talking about some of the implementation ways that we can implement it what we would need to address and just a recognition that nobody in you know staff community I don't think you guys nobody wants to go back in terms of ease or speed of the permits because there's been such great progress by PBC to to streamline and such a great push on that that you know that that would certainly be the goal that we would want to work with in the existing system and figure out ways that we can streamline this.

Some of the things that we've done with other programs where we're trying to do income verification is we'll utilize um existing so you don't have to get a a tax you know record or anything like that is it you can use existing programs that people qualify for and some of that ac data we have access to right away because San Jose Clean Energy has access to the care and fair customers which are they're definitely much lower than AMI but that's a quick way to be able to verify.

So there's other programs like that that may be able to be utilized and we'd certainly look at that and figure out you know how that could be done.

So that's part of the process I think there's you know just some web updates and things like that that we've included in here and so that portion though that is just on the implementation side I think the biggest portion and again PBCE would need to vet these um figures a lot more to figure out but if there is additional um you know we assume there would be additional inspection costs potentially uh or inspection time that's um you know we again we'd have to verify that but that um would probably be the biggest portion so that looks like about say 4300 total um the fo most of that is for the inspection for the inspectors to do the additional time which um as Chris mentioned that's that um would typically be um it's cost recovery for for for permitting so thank you and then just to also be clear when we're throwing out phrases like zero percent financing that's a loan you got to pay that back just because of zero interest doesn't mean you're not paying money back you're not getting free money.

The interest rate may be lower, but you're still paying that money back.

Again, opportunity costs for that monthly payment.

You could be putting it to something else that yields you a higher return.

And also to be clear, I think Chris updated the amount of applications or permits a year is 1500, and we have less than six hundred money for less for six.

Yeah, the funding in terms of incentives for less than six hundred folks, right, or permits a year.

That's nowhere near half.

That's a third, maybe just slightly more than a third.

That is the current funding level.

We could always come back to council if we saw additional uptake on those rebates to um allocate additional funds to it.

The other part that really galls me is this paternalistic view that we're going to tell our constituents what's best for them, what they should be doing and not be doing.

They have the information we have, they can choose to do this if they want to do it or not.

Why does this have to be a mandatory thing if it's going to be mandatory at some point in the state level?

I I just it it again.

This is the type of stuff that we do here in California that force folks to want to leave.

And I would be supportive of the mayor and his brown acts memo if they were to make it no longer mandatory.

I think that's oh, and also to Cohen, I mean, if you trust them not to lie, then you should trust them based on the information they have available to them to make the right decision.

If they want a heat pump, they'll pick a heat pump.

They don't, then they don't.

Those are my comments.

Thank you.

Thanks, Councilmember.

Okay, let's go back around.

Uh Councilmember Tordias.

Thank you, Mayor, and thank you, all my colleagues for the robust discussion.

Uh, like Council Member Cohen, I will apologize if any of my remarks feel pointed.

I'm also very passionate about this issue.

Uh I want to start by just addressing the very real concern about impacts to seniors living, particularly those living on fixed incomes.

Uh to that I would say that I believe that the majority of those seniors living on fixed incomes, paycheck-to-paycheck will qualify for the existing uh income-based exemption that we've outlined in the memo.

Uh on the notion of mandates first incentives.

Why can't we just trust people to make better decisions here?

Why does it have to be a mandate?

I will note that the city has opted for a mandate here because the evidence shows that it is critical that we electrify our heating end uses uh across our existing building stock.

And I will also just note that mandates are nothing new to government.

Uh we have many examples of mandates related to climate and environment over the years.

Uh, as a society, we banned ozone depleting chemicals to fix the whole the hole in the ozone layer.

We didn't just ask people to make better choices when they were buying refrigerators.

Uh, we mandated vehicle efficiency standards.

We didn't just ask people to make better choices when they were buying cars, and those previous mandates had real positive impacts to our environment.

And I think that this policy will have those same benefits to our environment.

Uh I really resonated with what was said uh about the fact that our younger generation is the one that will be bearing the brunt of the cost of our failure to address climate change.

Uh, and I will hope that we are able to act on that today.

Uh, you know.

With all due respect, I really appreciate the fact that this council previously voted to uh opt in to our 2030 carbon neutrality goals.

But I think that those goals are somewhat meaningless if we're not willing to actually take the action to bring those goals into reality and actually hit the targets that we're setting as a city.

Uh so I hope we're able to come together and support this policy today.

Thank you.

Thank council member.

Council More Casey.

I just wanted to emphasize that this is a half-baked idea, and to the false equivalency of those other mandates.

They seem to be more fleshed out than this one.

We don't have as it stands a plan to implement this as far as the the cohort that we're supposedly so concerned about, the folks at the 100% AMI.

We don't have a cogent plan right now on how we're going to implement that.

So the idea that we're just going to move forward and hope, jump out of the airplane and make a parachute on the way down, doesn't make sense to me.

Thanks, Councilmember.

Let's um go back to Council Tordias quickly.

Yeah, I would just quickly note that it is not uncommon for us to pass policy directives that then have an implementation phase where final details are sorted out.

That is the sort of thing that we do all the time, and staff has already expressed confidence that they're able to sort out these issues and these final implementation details before this policy would go into effect.

Uh Vice Mayor.

Well, I thought Councilmember Casey might, but he does have his mic on.

I'm coming to you.

I also have not weighed in at all.

I don't have a whole lot to say, but go ahead.

I was going to ask the maker of the motion if they would uh modify the mayor your memo, uh council member Collins, and make it uh remove the mandatory component of it.

No, I mean that do we have that now?

Yes, I would change.

Do you want to just use your mic?

Sorry.

Uh no, I mean, we that's what the policy is now.

We have the rebate program in place.

We have a voluntary program, and this policy is is uh is an improvement on that.

And I think that's not a that's not in the spirit of the reach code.

The reach code is um something different, and um I don't know.

Fair enough.

Thank you.

Yeah, so I'll let me just try to offer a few reflections, and I I really appreciate the dialogue.

I know it sometimes gets charged and can feel a little personal, and but I actually really appreciate everybody's questions and perspective because they were all substantive, and I think coming from a genuine desire to make good decisions, and we're not all gonna agree on everything.

Um so I I appreciate the dialogue, and I'll be honest, I myself have been fairly torn on this one.

I think council member Cohen would tell you that as we've discussed this over the last couple of weeks, my team and I have been uh kind of going back and forth.

In fact, I'll just say I I would not have signed on.

I was a late signer on the memo, would not have signed on had we required the pre-wiring component, for example, because that felt to me very much like a mandate that would impose cost without an immediate benefit.

I do think part of part of my uh, you know, I appreciate Councilmember Tordios' point about we regularly mandate things that are in the social or public good when we have a collective action problem or we have a um we have a time duration issue.

And I was I think my ultimately getting comfortable with the notion of the heat pump specifically just comes from personal experience.

About six weeks ago, our AC unit started leaking, it caused a whole mess, we needed to replace it.

Uh in the process of replacing it, I learned quite a bit.

And I was very interested to find that first of all, the contractors for the ease of showing a lower sticker price and sticking with what they're comfortable with, often will simply push you the existing standard old model because it's sticker price is a bit cheaper.

It was that 10,000 versus like 11,500.

So there was there was that I forget I don't have the exact quotes in front of me.

There was a delta.

And until I started asking questions, I was just being offered the same old the old model because it's just what they're used to, it's faster and it's a bit cheaper, and they don't really bother, they're not going to talk you through all the pros and cons.

Um, so we install the thing, and I'll and I'll acknowledge I'm not at 100%.

My wife and I are higher than 100% of AMI income.

So, you know, I think council member Casey's and Councilmember Tease's points are exactly the very questions my team and I have been asking the last couple of weeks and trying to grapple with, and I'll come back to the rebates in a moment here.

But we installed the thing, and not only did we get the new AC unit, but it's a heat pump, so it covers the heater, which by the way, I'm pretty sure is going was gonna go out in the next five years because it's about the same age as the AC unit.

It just doesn't, they don't tend to go out at exactly the same moment.

So imagine being the person who has to replace the AC unit for 10 grand and then come back in two, three, four, five years and spend almost as much to now separately replace the heater.

But we didn't, we just did the heat pump because I asked a bunch of questions, probably prompted by this item coming to council, and we install the thing.

So I have this app that shows me all of our energy use.

I can see exactly when it when a unit comes on, when it doesn't, and you know, in accordance with what we're hearing from staff, the impact on energy use when the uh AC unitslash heater comes on, is literally about a third of what it was before six weeks ago.

It's way lower.

So I haven't done the math yet, but I'm pretty sure I'm gonna be paid back within four or five years.

Now, again, not everybody, this is a challenge with public policy making.

They're always edge cases.

I mean, Councilmember Foley's right, there's some people whose expected value will not be the same window, and that's an issue.

And there is always a risk of pass-on cost to council member Ortiz's point.

So, I mean, we have to acknowledge that these things are imperfect.

I'll also say Councilmember Casey's questions about implementation are valid, and the more that staff can come in with a more fully baked plan around how will we implement uh when it seems to be a core component of a program is helpful, but I also think it's true that we often give direction at a policy level, and staff figures out implementation and reports back.

Which gets to a point I wanted to make or a question really on rebates, which is to me, for those of you who were not in the mindset that this is merely black and white.

I'm gonna be I'm definitely for it or I'm against it, but you had the more nuanced questions.

There is an opportunity here in this meeting through our memo process to bring adjustments around different components.

Like maybe the maybe somebody today should argue for the AMI being 150%, not 100%, or the rebate being a little bit larger.

Or the question I have is if we find uptake and we do education, I have a question about how do we educate about the rebates, and if uptake is what it I think ought to be, what kind of net revenues are we projecting for our energy program to be able to fund those if suddenly half of people installing heat pumps are not exempt and want to rebate, and we find that out with your updates three years from now.

So I guess I'd like to understand how this may play out and when the council's gonna be able to maybe give guidance to expand a program or pause what we're doing here.

Because I think we have to acknowledge these things do come with trade-offs, and they're never perfect in implementation.

Yeah, so I think um, in terms of rebates and uptick, I think we would bring that to council as part of our program's roadmap every year, and if we saw that there was a lot of uptake in the heat pump, we would bring forward recommendations for council consideration.

Um, you know, one of the questions we received was you know we have a certain amount of funding um for heat pumps now, and if if we needed to expand that for all, we you know, we estimate that we need about another million dollars, a little bit over that in terms of the heat pump program to be able to cover that.

So that's something that council could consider.

Obviously, there'd be trade-offs to other programs, and so um, you know, we could bring that forward.

Okay.

Do you have any further thought, or could we perhaps at a future date try to better understand or come back on this?

I think insightful question council member Ortiz raised around the larger multifamily property properties.

Because I will tell you, my experience was I think we just saved a ton of money by doing a heat pump.

I'm not gonna have to replace a heater for 15, maybe 20 years, and we're using one-third of the energy we were six weeks ago.

I think I'm gonna be in a great position a few years from now just looking at the value of this, but not everybody and not every user is in the same position.

So, uh, is there a risk here of these larger multifamily users making big capital upgrades and then passing that on to renters?

And how would we know and could we mitigate that?

And is the state gonna force that regardless in a few years?

To which point Councilmember Casey has a good point.

But anyway, are you are you just talking generally or for this reach go?

Because I'm saying for this use, because it's it's all residential, right?

So this is so the reach code is only for single.

Yes, it's only single family.

Okay.

So it is not the multifamily passing to most of our, okay, but there are still plenty of renters and single-family homes to council member Ortiz's point.

Okay.

Yeah, and I think um just to again point out this is um triggered off of an AC replacement or installation.

So, I guess, personally, I would have the same question about those and those being passed on, which I know is an issue that you know we probably have looked at before too.

Okay, um, and sorry, just again, when would be the next point at which we would get an update on implementation and some initial data.

We can try to get to that data at the climate smart update in October, but definitely get to you before it it is implemented at the first of the year through an informational menu memo as well.

Okay, thank you.

All right, um, well, I think it is uh there are trade-offs, it's imperfect.

This memo is a compromise in the sense that it does not go as far as the staff memo wanted to go.

Uh staff memo wanted to go farther.

This memo, in my view, pulls back rightly.

Um, and again, I'm probably a little biased by my own experience, but there is this time duration issue where if we don't nudge people to make the decision, I think they may very well have the experience I was about to have, which is a contractor saying, here's the thing that's 10% cheaper, just do it, I'll get it installed today.

And unless we use our regulatory power to nudge the market where we want to go, I do fear that we're gonna be sub-optimized over time, but that's not to say it doesn't come without potential risk raised.

I think very thoughtfully by council members Casey and Ortiz.

So I appreciate the the uh the critiques and the tough questions and think this is gonna be an ongoing conversation.

I think Councilmember Casey's right.

A lot of regulation leads to a state that's got a higher cost of living, and there are costs to that.

So it's a personal decision we each have to make on which costs are worthwhile and which ones aren't.

This one for me, I think will save money over time, so I can live with it, but it's it's it's certainly not perfect.

Uh so I'll be voting uh in support, but it was not an easy decision for me to get here either.

Um let me go.

We do have a couple more hands.

We'll take those and then hopefully we can get to a vote.

Council Cohen.

Just three quick things that were triggered by your comments.

Number one, it's important that the default position for our contractors be this, this is the op.

This is a a better could be a better option for you rather than what so that's a great anecdote that you gave because that's the purpose of this is to make that a default position.

Number two, just want to make it clear.

You said a million dollars could add and it would trade off, but it's all a trade-off within the enterprise program of clean energy.

I just want to make sure it's clear to everybody.

We're not talking about general fund impact.

We're talking about adjusting where we spend what was about 13 million last year on clean energy programs, and how whether we need to take a million that we're spending on another incentive and move it here to make sure this incentive is covered.

Is that correct?

Correct, correct, all within our fund.

And then number three, we're implementing in January.

The current programs expire at the end of the fiscal year.

So it's a half year implementation with an energy roadmap discussion in the spring to determine the amounts we need for the 26-27 fiscal year.

Correct?

That's correct.

All right, thank you.

Okay, thanks, counselor.

Counselor Tordios.

Thank you.

One final comment spurred again by the mayor's anecdote.

Uh, and this is again on economic impacts.

Just pointing out that to the extent that contractors out in the field, as people have air conditioners that are coming to end of life, if they're just getting prompted to replace them with like-for-like units now in a couple years, once the air quality management district mandate comes into effect, banning uh, you know, natural gas furnaces.

A lot of those folks are gonna be in the be very unenviable position of then having a furnace die a couple years from now, having to purchase a heat pump anyway, when they could have saved that cost by consolidating exactly as the mayor has.

So thank you for bringing that up.

That's a great note.

Uh Councilmember Condelas.

Mayor, for the record, uh you know, my company probably would have been able to do your furnace change out cheaper.

You would have uh your dad would have given me a discount.

I don't think I'm allowed to accept that.

Um, thanks.

Uh, did you want to get in a PSA on the company name or anything while we're at it?

Uh thanks, Councilmember.

All right, just kidding.

I'm kidding.

All right, so I think we have actually exhausted everyone's comments and questions.

Let's vote.

It's a tie with uh mayhan Cohen, Candela's Tordillos and Campos voting yes, and Kamei Ortiz Duan fully and and Casey voting no.

Alright, so that fails.

Fails.

All right.

So we're gonna thank you, staff for all your work on this.

We're gonna move on to the next item.

Okay, we are on to our last agendized item, which is item 6.3, San Jose Municipal Water System 2025, public health goals report on water quality.

We have a staff presentation.

As I understand it.

Is Jeff's still here?

Oh, there he is.

He was just there you go.

Jeff, did you have a verbal report?

Or did I misunderstand that?

I did not have a verbal report, but I am here to answer any questions.

Got it.

Thank you.

Okay, wonderful.

Uh well, everybody's got the staff memo.

Tony, do we have public comment?

Yes, Dashial, come on down.

All right.

Dash will you said?

Yeah, Dash.

Okay, here he comes.

All right.

Hi, um, Dasha Leeds, District 6 resident here.

Just speaking as my for myself here, um, just saw the results of the water quality study.

Saw that there was uranium and other contaminants in their water quality that were above or our public health goals.

I saw that there wasn't any action recommended in the report.

Uh I just wanted to say that I'm concerned about these contaminants.

I'm concerned for my health, my loved ones, uh fellow San Jose residents, and I don't know what um ability the city has to influence this.

I know some parts of water quality are outside of our purview here, but uh just whatever you can do to make our water quality cleaner, uh, we would much appreciate that.

Thanks for your time.

Back to council.

Okay, thanks.

Coming back to the council.

Council of Kamehameha.

I just wanted to move approval of uh staff's recommendation.

Second.

Great.

Thank you.

I don't see any other hands.

Tony, let's vote.

Motion passes unanimously.

Great, thank you.

Alright, we are on to open forum, which is an opportunity for members of the public to comment on any city business not on today's agenda.

Do we have any comments?

Yes, Jordan and Acos.

Come on down.

I also have um Amon, but I think he's already left.

So it goes and Jordan.

Come on down.

Whoever reaches the podium first can get started.

Uh I wanted to thank the council for the transit month proclamation earlier this morning.

Uh I wanted to add two things to that.

One, Kalea forgot to mention there's also gonna be a party at Diridaan on Saturday the 20th, celebrating uh the relationship between San Jose and Los Angeles and the high speed rail project.

Uh so come on down, and I'm hoping to possibly have some demonstrations for folks of how to bring your bike onto the train and onto the VTA buses.

Uh so it'll be a fun time.

Um, second, I also wanted to call out that Transit Month at the very end, there's also the week without driving, which is an opportunity to understand um the experiences of the one third of Americans who can't drive or don't have a car.

Um that includes older adults, kids under the age of 18, folks with disabilities, um, and folks who just can't afford a car and can't afford someone else to drive them around.

And so the idea behind week without driving is you try and see how many of your car trips that you can uh replace.

And uh as you're doing that, reflect and say, like, um, okay, this is what it's like to live without the ability to drive or be driven around.

And it's okay, it's okay to fail.

Um, many will, and that's okay.

And just the idea is to reflect on that.

Um, okay, I had to get in my car and get to this appointment.

What would I have done if I didn't have that luxury available to me?

Um, and just reflect on that um, and then keep those reflections in mind, uh, when we're working on the future of transportation in San Jose, that not everyone can drive.

Um, and it can be really, really difficult if you're in that position.

So thank you, and I hope you'll take the pledge.

What's the week?

It's the partial week of September into October.

Um I forget if it's a Monday to a Sunday or if it's a Sunday to Saturday.

Thank you.

My name is Aquush Soboslay.

I was president of the modern transit society, which was the organization behind bringing light rail and bar to the county and the tax for transit in 1976 that funds the VTA.

Please repeal ordinance 113270 that prohibits pedestrians and transit patrons from expressways, with no exception for sidewalks, paths, and bus stops.

The BPAC unanimously requested City Council to repeal.

One of our members lived two blocks from the Capitol Light Rail Station.

You prohibit you prohibited him from using light rail because you only allow car owners driving into the parking lot to use the station.

The photo shows sidewalks and also light rail down the road are prohibited.

If that sounds absurd, repeal the ordinance.

All bus lines crossing expressways stop at expressways so transit patrons can use expressways.

You also prohibit them.

State law gave no authority to prohibit pedestrians from expressways, so I forced removal of your pedestrians prohibited signs.

I won all votes of the County Board of Supervisors requiring pedestrian facilities on expressways.

See the list and details which I emailed the clerk.

Despite these votes, counties highway staff refused to comply because quote, that would encourage pedestrians to violate the city ordinance, unquote.

Your ordinance resulted in many pedestrian fatalities.

It is discriminatory, unjust, and dangerous.

Please repeal it.

Thank you.

Back to council.

Okay, thank you all very much.

Have a great evening.

We are adjourned.