Present Ortiz.

Present.

Vice Chair Foley.

Here.

Chair Cohen, absent.

You have a quorum.

Great.

Thank you.

So we don't have we're not reviewing the work plan or consent calendar.

We're gonna jump right into the reports.

And the chair has kindly asked that we flip the order and that we move the bike plan 2025 to be the first presentation.

So move.

Second.

All in favor.

Aye.

Thank you.

Motion carries to move, make that adjustment.

Good afternoon, Vice Mayor and members committee.

John Rissell, Director of Transportation.

We are here to give you the presentation on the city's bike plan and trail network.

With me is Jessica Zenck, Deputy Director for Department of Transportation, Ramses Madoo, our Division Manager for Transportation.

And soon to join us will be Liz Sewell, Parks Manager with Parks Recreation Neighborhood Services.

So I'm going to turn it right over to Ramses and we can get started.

All right.

Good afternoon, committee.

Ramses Medou, Division Manager of Planning Policy and Sustainability for DOT here.

We've just texted Liz to note that our item just got uh pushed forward.

So hopefully she's running over to the elevator.

And uh luckily my portion of the presentation is first, so hopefully that will work out.

So let's get into it.

Um so we're here to talk about both uh the implementation of the bike plan um as well as what's going on with the trail network.

This is our annual update.

Um as you all know, uh we passed a new bike plan back in about 2020 um called bike plan 2025, uh, which really accelerated development and took on um uh the kind of the new mode for the city in terms of what a bike plan can do, right?

This is really looking at all ages and all abilities, making sure that we're making uh the bike system safe and accessible uh for everybody and really driving that mode shift goal that's embedded in our uh general plan.

Uh the new uh plan does look for a 550 mile network um uh that primarily consists of protected bikeways um and bike boulevards.

The types of infrastructure that we're really looking for in the uh implementation of the plan are these four here.

Um really focusing on creating physical barriers um uh where we can, particularly on larger streets with either higher volumes or faster speeds, um, whether that be uh with our first attempts with Quick Build, uh which has been a huge success in terms of getting a lot of infrastructure out there quickly.

Uh thank you so much for all the support and getting that done, um, as well as some great new heartscapes.

We're seeing more and more of that.

And I'll talk about that a little bit later as we go forward.

Um, and then a lot of the bike boulevards, and we're starting to implement that as well.

And those are on the quieter streets where if we can calm traffic a little bit um and give some specific pointers to drivers and bicyclists, we can create a better environment.

Um so what is our bike work uh network look like today and some of the accomplishments from a very busy year in 2025.

Our existing network um is about 491 miles.

Uh and I just want to point out uh this this has all been done in the last roughly 15, 18 years.

Um this has been really an incredible piece of work uh by the city.

Our new plan network, as we said, is 550 miles, 350 of those we are hoping to make uh enter protected bikeways and about a hundred and uh bike boulevards.

The rest is the traditional uh stripe on the side of the road.

2025 was another huge year for the bike program.

Uh we added uh about seven and a half miles of new bikeway, and importantly, uh that work of enhancing uh those uh bikeways that are currently uh not up to the plans expectations, um, are seeing that extra work, getting either those uh separations with pylons or through concrete and the like.

All right, so some of the uh notable achievements here is uh uh a lane reduction over on Alma Road.

Uh this is uh just past eight or just going under 87 to the east.

Um there.

Um we added six new miles of protected bikeway, uh like I said, including some of those upgrades.

Um and you hear some of the examples uh there.

Oakland Road being a pretty interesting one.

It's a huge stretch of roadway with a lot of a lot of cars and some pretty good speed, so getting that separation is pretty important.

And we also succeeded after a few years of going back and forth with VTA and the new wheel, the Bay Wheel system run by Lyft to get a station at the BART stop there.

That was a fun adventure, and it's finally come to the right conclusion.

Some of the projects that are ongoing right now are pretty exciting.

In particular, the downtown better bikeways implementation.

You may see the teams are out there in between the in between the big sporting events, making sure we're managing this construction properly.

They're getting out there, pouring concrete, building out things like you can see both in the top two pictures there that are basically turning what we have, which has been paint and plastic into those concrete separators, creating what we would really expect in a downtown.

We're seeing some other great pieces like the River Oaks protected bikeway being built out and some new wayfinding there on Alma Av.

Yeah, those are there.

Some really exciting future projects that are cooking right now and going to be implemented over the next couple of years.

Is that full build out of the Better Bikeways phase two?

So that's that downtown plan.

We're finally going to be taking San Fernando from its paint and plastic design into the concrete.

And I'll say this has been to us in DOT, this has really been kind of one of the bellwethers.

It was one of the ones where we really first got a lot of attention and money and effort and kind of reformatting how we work in DOT around this project.

So it's really cool to see it come into the fruition around a truly protected system.

We've learned so much through that project and has kind of helped us understand what else to do.

Another really important one is story keys.

King King, thank you.

And then we're doing uh a further planning effort on the eastern, more eastern part there.

Um but this one uh the construction is supposed to start in the next year on the first part, uh, which is the actual keys part up to first, um, and then the construction on the next part starts the following year.

Um yeah, and then we have a huge uh Bay Wheels expansion.

Uh we got some great grant uh money there, expanding the system over to the east side, uh, bringing in a lot of our equity priority communities into the uh fold there.

Um got some great not only expansion but also um uh price uh cost sharing to enable folks to use that system for a cheaper price point.

And we have our normal pavement maintenance bikeways, uh kind of that opportunistic use of of our programs to get more going.

Um we've got some uh planning grants that are helping us uh expand.

As I said, that east uh east story road complete street, so that's expanding that story keys work further east.

Um, and then uh coming to council tomorrow.

We have the Guadalupe River Trail on street bike connections.

That's looking at where flooding happens on Guadalupe River Trail and finding some ways around the places where we think we can take the first action to alleviate that.

A lot of people use that as a commute route, um, and so when it gets closed off, it's really disruptive to people's uh ability to get to work.

And it's not only during rain, but it's actually after because it takes us a while to get teams out there to clean up when it gets flooded.

Um, and then we are looking at uh getting a new bike plan update.

We're looking for money right now to fully fund that, um, but it's about time to look and see what we can we can do there.

All right, um, another important topic is maintaining and keeping our uh bikeways clear and operational.

Um every inch of streetway is quite contested between the immense amounts of different uses of the street and various uh one of the things that we've seen a lot is the interaction between a refuse uh collection and the bikeways.

We've got a very good relationship with ESD around uh uh trying uh how to alleviate some of the problems here.

Um we had a uh pilot program where we're getting reflective stickers and uh uh on a lot of the dumpsters as well as signs out on the um the residential bins that tell folks don't put these in the bike lanes, put them up against the curb where that's possible.

You can see in the right-hand uh picture, we've got a lot of problems with these dumpsters kind of flowing in, and you can see it every time you go by Third Street right here.

Drives me nuts.

Um, but what we've done in the uh design of the Better Bikeways concrete uh plans that are going out there right now is build in places for those dumpsters to sit, and we're uh we're gonna be re-evaluating after that project is done to see if we need to do more uh to keep them out because we spend a lot of money and time getting those things out there, um, and then the refuse spins just sit in the middle of there, causing bikes to have to go out on the road anyways.

All right.

Um with perfect timing.

Here's Liz.

Hi everyone, thank you, Ramses.

I'm Liz Sewell.

I am the trail manager for the city of San Jose, and actually Yitong is in the stands.

She is my Yi Tong Zeng, is my uh is our landscape designer for our trail systems.

So this first slide is probably familiar to those of you who have been on the Transportation and Environment Committee or sorry, excuse me, commission for a while.

Um, this is the overall network of trails in the city of San Jose.

It shows about a hundred miles of planned and completed trails.

Uh, and we wanted to show you this because last year two miles of trail were completed, and that's actually that's a pretty big number, um, especially since it includes uh a couple of retaining walls, uh undercrossing and a bridge over the Coyote Creek Trail.

So if you can go to the next slide, thank you.

I'll remember to do that next time.

Um so this next slide shows the ribbon cutting for those two miles of trail.

Um it was it happened last year, and um it included Councilmember Duan and uh others from the parks department and our public works department, um and it celebrated overall the the new connections between Barriessa Bart and Watson Park, as well as between pretty close to the Vietnamese gardens south of the Vietnamese gardens at Phelan down to Tully.

So separately from the the Capitol Department, our parks division has been doing really great work managing encampments and um cleaning the trails overall.

Uh it has increased, so you can see the no encampment zone sign up in the upper right hand corner.

Um we did a count in 2024, right before the no return zones were established along the Guadalupe, and then we did some counts after, and we saw the trail use increase by two.

So it the trail usage numbers are about two times what they were prior to the encampment, prior to all of that work being done on the Guadalupe River Trail.

So I wanted to highlight some key trail projects on this slide.

You can see uh the um the top photo shows the what will be the five wounds trail.

Um it's the old Union Pacific Railroad that's now owned by VTA.

It's undergoing master plan and environmental overview.

Some environmental documents are being done.

We're not sure if that's gonna be a master plan.

Excuse me, a sequire and EIR or exactly how that will work out yet.

Um also the initial design of the Coyote Creek Trail between San Jose High School and Watson Park is being done.

The thank you.

Um the regulatory feasibility of the Lower Silver Creek Trail between Alum Rock and Mayfair is being completed.

That might take a couple of years just because it's going through regulatory overview by the US Army Corps of Engineers.

Um and then finally, design of the Guadalupe River Trail between Branham and Chinawith, which will extend the trail up through Lake up from Lake Almadan.

Um then we have begun comprehensive trail assessments, and we do them by annually.

So our last assessment was last year, and the next one will be in 2027.

And it's across the entire network of trails, and we evaluate pavement and signage and fencing conditions.

Um the repair are prioritized based on the frequency of trail use and the severity of deterioration.

So recently we've repaired the bike erosion along Las Gattus Creek Trail near Meridian and Lee.

We have resurfaced segments of the Guadalupe River Trail within the downtown core, and we have ongoing work to repair the erosion along lower, excuse me, the Silver Creek Valley Trail.

So with that, that completes my portion of the presentation.

And I think we open for questions.

Thank you, Liz.

All right, thank you.

Uh thank you, Vice Mayor, for kicking us off.

Um glad to be able to join you.

Um I don't know if we have any members of the public here, so let's come back to the committee and start with uh Vice Mayor Foley.

Thank you.

Thank you for both presentations on the bike lanes and and the trails.

I'm really excited to see all the protected bike lanes going in and the bike lanes in general going in.

I several came were completed in District 9, and I'm I'm thrilled.

And I know residents say, well, yeah, but we don't ever see anybody riding the bikes, but they do now because they actually have a bike lane.

So we've connected meridian all the way up, which is really wonderful.

But I did want to talk about the bike trail or the trail along the Guadalupe and the generosity of Congressman Panetta, who was able to get a million dollar earmark to build out that trail once the plan is in place.

So we had a press conference with him last week, and it's uh very exciting that he was thinking about us and and got the money for us.

So I just wanted to make that that public announcement and thank you for all your work.

It's really exciting since we have removed the unhoused along the Guadalupe in that area, and now they're in an emergency interim housing right next door.

The trail and that area is just so beautiful, and the neighbors remember why they bought or why they moved into that area.

So thank you for working on the trails, building it out, and I'm excited about what the future holds for that area.

That's it for me, thank you.

Oh, uh move approval of the report.

Second.

All right, uh, now we'll move on to Councilmember Campos.

Thank you, Chair, and thank you, staff for this report today.

Also uh really great work that I just want to commend because it is so critical as uh someone who um is liaison to the youth commission and constantly hearing about the climate concerns that they have and the fact that our city is uh making real progress on creating um opportunities for folks to get out of their cars and uh writing uh you know walking, biking, um making our streets more safe for pedestrians and bicyclists.

So um I have just one question out of experience for something that happened in my district and wanting to hear how this might be uh incorporated into lessons learned for the future.

We um have the Silicon Valley Bike Boulevard, which is um has recently seen some changes to incorporate the uh bike plan and trail network, and the changes uh were begun because of some construction in the industrial area.

Um it's around the Basking Ridge neighborhood.

So for folks who are unfamiliar with district two, it is a uh residential neighborhood, mostly single-family homes.

Uh about half of the students that go to the school live in the area, but about half of them are driving in uh using Silicon Valley Boulevard.

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

So it's a great point.

Thank you for raising it.

I think um one of the things we've talked about with our colleagues who help us with the development services process is how do we think more holistically before the outreach process begins about who the users are and who should be notified and how we should do that.

So I think starting from that point, which at this point in this case of this project was many years ago, that's kind of a key lesson learned that if we had um looked differently at than just the standard outreach process, we could have incorporated uh different set of perspectives into the design of those facilities.

So I think that's the kind of leading indicator there, um, although we are also working on how to um make sure that our communication during construction and that the coordination of the actual implementation is uh much tighter so that people kind of can see those facilities more clearly, have better notification and understand that the changes are coming, hopefully with more input at the design point.

So thank you for the comment and for um helping us connect with the neighborhoods affected.

Yeah.

And and I just want to say thank you.

I know DOT and many other um departments were out there meeting with the residents in that inclement weather and and demonstrating that we are receptive and and that we do truly care about their safety.

So I appreciate the acknowledgement that sometimes the bare minimum isn't enough, and that some we do have to um sometimes look a little broader and making sure that we're capturing those voices.

So still looking forward to the day that we can get a um walk and roll or like a bike um group of of kiddos going to the school so that we can demonstrate that uh we really do need these bike lanes in our communities and that people do want to ride them.

So thank you again for the great work.

Thank you.

Uh now council member Tredia's.

Thank you, Chair, and thank you, staff, for the update on all of this work.

Uh, I'm excited to see the city continuing to invest in our improving our bike lanes, and I've been particularly excited to see all of the hardscape improvements going in downtown.

Uh, you know, maybe just because I've been paying more attention, but I certainly feel like I see more people actually using the bike lanes downtown.

Uh you know, I walk past three different protected bike lanes on my way to and from work every day, and every day I see at least a dozen people out there.

So it's good to see.

Uh one challenge that I do see though, uh, and it's you know referenced in the report is you know, cars continuing to block the entrance, particularly to some of the new uh bike lanes, which now that there's hardscaping actually makes it a little bit more difficult than the old uh you know, paint and bollards uh situation, since sometimes you can't even get into the bike lanes.

Uh so I think a good opportunity to continue to work with you know our state legislature uh to see if there are opportunities uh here.

I know that there's a bill moving through the legislature now around automated vehicle enforcement and curb management using cameras to potentially issue citations for things like illegal parking or blocking of bike lanes.

I also encourage you all to continue to work with IGR to see if there's modifications to the bill that would uh give us a little bit more authority here, or if this is something the city might want to, you know, come out and take a position of support on.

Uh and the final thing I just wanted to note is that I'm starting to see even a little bit more positivity from places outside of downtown with some of our bike lanes.

Uh I was at a neighborhood association meeting last night, or sorry, last week, um, and there was a resident who prepared to speak and he was very angry and he was like, I want to talk about bike lanes.

It was about the Alma bike lane.

And it turned out that he was upset that it took as long as it did to get it constructed, and that there still isn't green paint in uh you know a portion of it that he cares about.

Uh but he went on to just give a glowing review of how he didn't used to feel safe uh biking with his kids to the nearby safe way, and now that's their primary way that they go from their home to get groceries uh every week.

Uh so I feel like the message is starting to get out there to folks.

We're seeing more uptake uh and people are actually appreciative of the city investing in road safety.

So just want to thank you all for the work that you're doing.

Thank you.

Uh and I want to thank you too for the work, a lot of proactive work that you're doing was as the paving is getting done across our city.

I see proactive bike lane improvements that are not things that we are discussing.

So I know that your team is out and looking for opportunities to improve, and you can see I I think we can tell, and certainly in the five years that I've been doing this, uh I can tell the tremendous change in in the the infrastructure, and I'm really excited about it.

You know, I talked to people, I was talking to somebody in Sunnyvale about what we've been doing in San Jose, and I'm I was excited to share some of these photos with them and say, look, this is really this is what's happening downtown.

Our lanes really are protected.

I'll just point out the one I repeat this frustration every time.

Um when you look at the map that shows the bike bikeways, you see nice north-south routes, but in the north, particularly in the north part of the city, go and probably f all along East San Jose, it's really hard to get east-west.

All those the highways are natural barriers, and I know how hard it is, but it's something we continually should just keep elevated that it's something uh to address.

Um and I appreciate the the for those of us who bike on the Guadalupe Trail, we know what happens in the rainy season underneath the highways and you can't go through.

Um, and I appreciate the the for those of us who bike on the Guadalupe Trail, we know what happens in the rainy season underneath the highways and you can't go through, and when it happens, how long it is to get all the way around to get back to the trail if you can't go under.

So I appreciate that work.

While we're talking about that, um, I'll I'll just highlight the the trail that goes the penitentiary creek trail that goes under 680 east of uh Jackson uh has a similar problem in the winter um and often doesn't get the attention to to dredge it back out and make it usable.

So just another area I want to call your attention to because a lot of people do use that trail and have trouble getting through.

Um but we have a motion and a second, so let's vote to accept the report.

Thank you.

Motion carries five zero.

All right, thanks.

Now we're on to our next item back to item one, our infrastructure report on the city fleet management program.

Good afternoon.

Good afternoon.

I am Matt Lesh, I'm the director of public works.

And with me is uh Walter Lynn, Deputy Public Works Director and Dave Mesa, our fleet manager.

We also have our analyst for fleet services, Rajvir Desange with us as well to help us with answer any questions.

So I'll kick it over to Walter to talk to us about our fleet.

Thank you so much, Matt, and um Chair Cohen, Vice Chair Foley, and members of the Transportation and Environment Committee.

As Matt mentioned, I am Walter Lynn.

I'm the deputy director of public works.

I'm here with my colleague uh David Mesa, who is our fleet manager, and we'll be sharing the presentation with you today.

Um earlier this morning, uh the you had heard the deferred maintenance and infrastructure backlog report, and that was a great lead-in into what we're gonna share with you today in regards to an analogy that Matt had mentioned where we need to take care of our assets, including our fleet inventory, which includes our rolling stock, our vehicles, and also our equipment, such as generators and trailers and things that do not move.

Uh, we'll be sharing with you today elements of what our current city inventory entails, uh, what the current challenges are and the future approaches in order for us to get the most efficient, most safe, and the most compliant fleets uh that we need to have.

Uh during this presentation, we'll be talking to you about the fleet services and inventory, uh, regulations and also the electrification of our fleets.

And Sherry Cohen, uh, we did not forget what you had shared with us in October.

We were looking at the procurement of particular fire vehicles and some of the inquiries that you had there.

We'll be addressing that uh during this uh presentation as well.

Uh the availability of the vehicles and also service of our existing vehicles, uh, the challenges and also the opportunities uh that we still feel are uh out there and available, and our continued pursuit of those options.

Uh just an overview of our fleet services.

So when we're talking about acquisition and disposal, um, we need to remember that when we are procuring our fleets, it's not as simple as just going to a dealership, going to a lot.

We see vehicles there, can't we just buy them, build them up, and provide those keys to our operating departments.

There is a lot that goes behind what uh is entailed in the procurement of a fleet.

And David will go through that in just a moment here.

Uh but it involves more of that protocol process where there is a um a development of the specifications, very similar to when you're buying a personal vehicle.

There are various trims, there's various options.

We need to make sure that from a feasibility and a suitability standpoint.

The vehicles and equipment that we're procuring meets the needs of the departments and their operations, and we are not we're not getting what we don't need.

Uh otherwise, there could be change orders and much more time and money spent to actually uh build the vehicles that we need.

Um we also have to follow the city's procurement process as well too.

So again, we just can't go in with a checkbook, a P card.

We need to follow up the procurement process.

There's a specific bidding aspect, and there are some times where we could use leverage contracts as well for our procurements, uh, which we are uh pursuing those particular options, but there is a specific city uh procurement protocol uh that we have to administer as well.

When it comes to disposal, those are either retirements where a vehicle has reached the uh end of useful life, either based on wear and tear, age, mileage, uh deficiencies within the vehicle itself where it may be no longer safe to operate, or we have to retire or redline those vehicles just based on operator safety.

Service and repairs, as the DMIB uh mentioned earlier today.

Service and repairs, as the DMIB mentioned earlier today, that is our bread and butter.

So within any given fiscal year, we average about 20,000 work orders a year for all of our city fleet, which we are just under 3100 units.

Of that, though, we are still fairly backlogged in terms of what we need to do to get all of the corrective maintenance, preventative maintenance, and obviously we will prioritize emergency maintenance, but we just don't have enough staff resources or budget to really get all of the maintenance needs as quickly as we'd like to, and back into the hands of the department operators.

Fuel and parts maintenance, uh parts uh management.

Um we have several millions of dollars of fuel budget uh that we uh procure and we sp we expend every year.

It is no secret that over the last three months, fuel has skyrocketed.

And at this point, when we're looking at unleaded and diesel and even renewable diesel that we use, uh the numbers are really outstanding astounding.

They are more than double than what we were seeing just in January alone.

So the fuel budget is absolutely going to be impacted.

Uh we've been in coordination with the budget office to really show what the trends that we're seeing and trying to best manage what we have and looking into the remainder of this fiscal year and its next fiscal year.

Mobile services, so we provide um uh assistance on the field as well too.

Uh whether it is refueling fire vehicles when they're um administering fire protection services on the field, uh, or whether we are refueling generators on the field as well.

Uh we are in our shops, but also out in the city facilities and also assisting other mobile city operations that are out in the field.

Rental vehicle coordination, that is a bigger part, that's becoming a growing part of our uh program, where uh as much as we can do with our existing city inventory of the city owned vehicles, there's still a deficiency where we're not able to get uh procurements in time, build up in time, where vehicles are needed in a more quicker fashion.

The rental amount that we have per year is three million dollars annually.

So it is a considerable amount, but that is a supplement to what we need for the um the city owned uh vehicle inventory.

Telematics, um, our fleet program embraces technology.

This is an aspect where not only do we have GPS, but these types of um uh software programs that we have within the vehicles, allow us to get more of the vehicle diagnostics.

So we can tell when a vehicle is due for service, we can sell when a vehicle is idling, we can sell when the vehicle is outside of a geofence that we have built in, particularly.

And it helps us find uh, which is very unfortunate, stolen vehicles.

Uh, we're able to quickly get that information to the police, and they have recovered some vehicles for us in the past, uh, just based on the telematics we have.

Emergency operations, whether we are inside the EOC or providing support outside of the EOC.

Our fleet team is uh there and always on a 24-7 365 scenario.

And electrification, this is the big one where there are city policies as well as state requirements that we are in need of compliance.

Um I want to make sure that we all understand as well to you that it's not just about the vehicles.

The vehicles are the big portion of it, but the behind the scenes is that we do need the electric vehicle charging stations, which are very expensive, and depending on the types that we need, uh, the infrastructure and the construction, as Matt mentioned during the DMIB report today, um, it is not an easy process.

Along with that, we want to make sure that our facilities can actually have and provide uh the necessary electrical service to those chargers.

As we're getting bigger vehicles that require the fast charging level threes, some of our facilities can't quite accommodate those chargers at this point.

So we do need an upgraded service from the electric utility.

That is something that we uh have been already coordinating, and uh we'll get into it in a little bit uh during this presentation.

But it's really the three main phases it's the vehicles, the chargers, and the facilities where those chargers live, uh, that we have to look at it from a global global standpoint.

So this is just a quick glimpse of what we have within our city's inventory.

Again, we have just under 3100 units.

In the upper right-hand corner, yes, we do tame dragons as well.

That is Dan and the Dragon from Happy Hollow Park and Zoo.

And on the bottom right corner, we have vehicles to put out those fires in case that dragon becomes untamed.

We have everything that you can imagine within a large city operation, and we're very proud to actually have these as city-owned assets.

And although we do need rentals to supplement uh what we do need of the overall inventory, having this equipment as city owned and city maintained is tremendously helpful as a world-class city that we want to be.

Um, having this readily available for our operations, it is extremely critical.

So there's a lot of numbers on this slide.

They are broken down by the vehicle type, which is light duty, medium duty, heavy duty, and other equipments.

The other equipment could be again generators, trailers, amusement park rides, and even some of the off-road and specialty equipment that we have at the regional wastewater facility, in particular the dredges, and that type of specialty equipment.

The second column or the second uh chart indicates the public safety versus non-public safety.

Public safety is 38% of our vehicle uh inventory.

And then the last set of data is the fuel base.

So it's uh unleaded, the alternative fuels, and then the non-fueled equipment.

Within the alternative fueled vehicles, uh, we have 53% of our city inventory that is alternative based, which is great.

But as you'll notice, the all electric though is just under 13%, and that's that's the category that we will be increasing over time, in particular as we have to meet the California Air Resources Board requirements as well, which we have a lot of upcoming uh deadlines.

With that, I'm gonna transition this to David, and he will go over some of the regulatory requirements and some of the availability and electrification uh processes.

Thanks, Walter.

Dave Mesa, uh fleet manager, Department of Public Works.

Um this next slide with uh regulations and electrification.

Uh, you're gonna see that we talk hitting a couple different things here, starting with the city's vehicle uh policy for procurement.

So we have what is a standard procurement, which we would go through, you know, every step of the process through the municipal code to procure a standard vehicle, whether it's a truck, fire truck, a boat, uh dredge, uh, all the different types of our of our city fleet, as Walter highlighted previously.

That's the standard method, or as of late, we've been able to leverage cooperative agreements to shorten uh procurement methods, timing to be able to get uh equipment and vehicles into the end user in a in a shorter, quicker fashion so that they can so that they can continue to do their job as quickly as possible for our community.

Um regarding regulations.

So, as many of you may have heard over the last several years, California Air Resources Board, they enacted the uh ACF, which is a advanced clean feats uh fleets, uh electrification of medium and heavy duty vehicles for public sector uh municipal fleets, uh state fleets, etc.

That has certain timelines where we have to procure medium and heavy duty fleet assets beginning 2024 and then phasing all the way to 2027, where those assets have to be 100% zero emission purchases, and then also the other uh timeline of 2040, which has us having to purchase all assets in a uh in a non-intern combustion uh vehicle classification.

Um going down to uh electric vehicle master plan that was uh completed last last year, I believe was when it was finalized, um highlighting the replacement of over 1,500 vehicles within our fleet at a cost of 110 million dollars, and then uh looking at the cost of the infrastructure, which is additional 65 million dollars, and then uh also that would create a reduction of 123 million metric tons of greenhouse gas emissions by our fleet.

The next slide just shows two main charging hubs that were put in through the PG ⁇ E project several years ago that the city operates and maintains.

One is located at Asbury Street, and the other one on the right hand side shows the the charging hub that's in our Mayberry Corp Yard.

And I will mention that since I took over as fleet manager in 2019, we've gone from 41 light duty EV vehicles to over 240 light duty EV vehicles.

So we're really continuing to move the needle year after year.

Availability and talent.

Uh so this this slide talks a little bit about what we currently have, as Walter mentioned.

We have 53% of our of our current fleet inventory that is on alternative fuels and continuing to grow year after year, and then staffing limitations and budget limitations.

We continue to see that our city fleet inventory grows year over year, but our our internal fleet management division staffing has stayed the same with net one to two FTEs since since 2008, I believe.

Again, with the with our fleet growing year after year to provide services to our community.

Manufacturer availability.

So as we continue to look at pushing our our fleet forward and electrifying our fleet, we also have to take into account that some manufacturers may or may not make it.

So we need to be smart in our decisions as far as electrification, knowing that we don't want to get stuck potentially with vehicles that become challenging to repair and maintain just for the sake of being clean.

One instance of that within our current fleet inventory, we have a large shuttle bus fleet at the airport that that company has gone out of business and it's becoming harder and harder to keep those assets, providing the services to the to the patrons of the airport.

Trying to make sure we can keep those assets as available as possible.

Again, so using that to kind of be the framework of our decision making for electrification based on the vocation.

And then city operational growth, as mentioned before, we've had since fiscal year 2012-13, we've had over 400 vehicles and equipment added to our fleet, and no staff to help manage that backlog of repairs, PMs, and inspections.

So as we as I discussed earlier, the the challenge for procurement can be daunting for our staff.

We currently our procurement team has a staff of two people that are in charge of roughly 250 to 300 uh procurements annually, whether it's a standard procurement, where it's a cookie cutter off-the-shelf truck, say with minimal build, or a deep technical build where you say we're buying a type one fire apparatus for our fire department, which just in developing the specification alone, it takes roughly 300 hours of staff time to develop that spec before that specification even gets published for bid.

So having a staff of two trying to manage that that portion could be challenging, also trying to meet our customer needs.

Um then again, that's just to get the spec out to bid.

We haven't gone through the bid process as well as the initial build meeting and then the middle construction final inspection to where it takes roughly you know, for that that type of vehicle takes roughly 36 months to get that vehicle delivered to the city of San J into the end user's hands to be able to provide services.

And with that, I'll turn it back to Walter.

Great.

Thank you so much, Dave.

Um, so the challenges that we're facing is uh a multitude when it comes to the state regulation, even though the federal administration has really um took a step backwards in regards to some of the electric vehicle requirements.

The state has not.

We've met with carb many times in terms of just sharing some of the challenges that we've had uh based on vehicle availability, budgets, infrastructure needs for the chargers.

That really doesn't move the needle with them in terms of those conversations.

They've indicated that it is something where they will still continue to move forward with these regulations, these compliance laws.

If municipalities can't accommodate based on budget availability, et cetera, that is not their problem necessarily.

If we indicate that we cannot find an electric equivalent on the marketplace, uh they will help find uh available suppliers, manufacturers, distributors of that vehicle equipment.

So the closely matching type that we can based on our needs.

Uh council member Cohen, as mentioned earlier.

If we cannot find that particular vehicle through all of our procurement means, and we have to go with a non-electric version uh as a one-for-one match, uh, we will list those conditions inside that council memo, uh just advising uh what is available, what is not available, and what doesn't meet the need based on the feasibility and the suitability uh study for for that department's operations.

With that though, the exemptions for carb, we submitted a listing.

We have not heard back in terms of whether they would accept it or not.

We do understand though that the exemptions are really thin and they do scrutinize them quite a bit.

The exception, the exemptions that they will provide is if there is a replacement need based on vehicle theft, or if it doesn't meet the conditions again and it's just not available in the marketplace at this point.

Rental vehicles, as we mentioned, we have quite a bit within the city's um fleet now, even though they're not city owned assets, those are still exempt uh from the car requirements at this point.

Processes and timelines, as David mentioned, uh the specifications on the procurement, that does still take quite a bit of time.

So either half a year to upwards of a year to write that specification when we have two FTEs doing that work.

It really is a daunting task, and that's why there's so many backlogged new vehicle requests or replacement vehicles that are trending in the multi-hundreds at this point.

We have nearly 200 backlog vehicles that we can't get to, whether it is based on the timing needed for the spec specifications writing the procurement, or just not having the budget, the general fund budget, or even the enterprise budget for those vehicles.

Um then once it is able to go out to procurement, um, the vehicle build timeline could be as what you can see here, uh a year, two years, three years, where these manufacturers, especially for the specialty vehicle type and the vocational vehicles, uh, it does still take quite a bit.

They are custom builds at times, and much of our staff's time is also going on inspections, viewing the builds, uh, pre-build, during build, and after build.

We don't want to take possession of those vehicles if they're built incorrectly.

If we have them transported here to San Jose, then we find that they're building correctly to send them back, it's just more time and money.

Those inspections are critical just to make sure that we are getting what we're paying for, and it's built correctly and safely.

The um the staffing though, I just want to mention again in regards to uh the timelines and the processing.

Dave mentioned the two FTEs for acquisitions.

We have 42 mechanic related positions within our fleet uh staffing.

So of the 62 uh FTEs within the fleet division, 43 are mechanic related, whether those are senior mechanics, mechanics, mechanic apprentices, or equipment uh maintenance assistance.

We have 43 managing almost 3100 assets.

And although we process 20,000 work orders a year, there are still many more prevented maintenance.

We're backlogged by 1,500 prevented and maintenance work orders.

During the DMIB, we had mentioned how critical preventative maintenance can be to really have an asset last as long as it needs to be before a critical replacement or an emergency replacement may be needed.

Um we're 61% deficient.

Uh we have 43 based on industry standards through the National Association of Fleet Administrators, and the calculation that we have based on the ratio of fleet equipment, we need to be at 110.

And we have 43.

So to the very best of our abilities as we're trying to push out and repair and service the vehicles back to our partner department's hands.

Uh, we just can't do it fast enough based on uh staffing limitations as well as non-personal budget limitations as well.

The budget limitations, as we had mentioned, so when we have a general fund allocation annually of about a million and a half dollars, that really only gets us between six to fourteen vehicles.

And again, it is all dependent on vehicle type and the uh associated options that we can have for those vehicles to really properly give the departments uh the that infrastructure within the vehicles to make sure that they're doing um their job safely and appropriately.

The electric equivalents can be 200 to 300% more of what we're seeing for an internal combustion engine vehicle.

Uh just using beautify SJ's program as an example, the um the debris body collection vehicles that they have, a normal unleaded or diesel gas vehicle, it's about 108,000.

The electric equivalent is 250,000, and that's not including the charger.

And the charging equipment again as a level three, that is a much heavier cost uh just to get that infrastructure in place also.

And as we mentioned, we we need the chargers, we need the facility electrical upgrades.

Um that is an opportunity though that uh we'll mention in this next slide.

Where from a funding perspective, we have been pursuing and identifying and applying for grants.

Uh, and we've won.

Uh last year, actually in 2024, we are working with the um the federal department of transportation.

They continue to offer a charging and fuel infrastructure grant where in early 2025, January 2025, the city was actually granted a 12 million dollar award specifically to help with electrification of our fleet and the infrastructure that goes behind it.

Unfortunately, two to three weeks later, when the new federal administration had taken over, that grant was frozen and rescinded, and the city did not receive that allocation that would have really helped put several level twos and level threes into our into our inventory.

But that's not stopping us.

We're gonna continue to look at very strategic approaches for funding opportunities, including more grants and any other funding assistance and incentives we can we can uh find out there.

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

Uh as led by the energy department, there is a um a fast charging hub program where it is allocating um enterprise funding from uh their operations to really put more chargers in community-based facilities.

And this would be more so in areas whether it's a downtown core or areas within a low income and disadvantaged communities, more for that uh public accessibility to those charging uh to that charging equipment, whereas city fleet can also use those uh those chargers as well too.

Utility programs, as mentioned in the last slide, uh we are working with PG ⁇ E.

There's a program called Rule 29, which we understand that certain areas, certain neighborhoods, certain block circuits that they provide that service may not have enough electrical capacity for more of the electric vehicle charging stations than not only what the city needs, but our neighboring entities as well too, and especially in some of these commercial and industrial zone locations, you may have a UPS, a FedEx, an Amazon depot, where they are also electrifying their fleet.

They're also competing with the electrical service that we need to power our fleet and working with PG ⁇ E, advising them what is our time frame, what is our needs, and reserving that electrical capacity for those specific facilities and those accounts that we need that electrical service to be in.

More so for our corporation yards.

So the Mabrier Yard, South Yard, West Yard, that's where we have a lot of our heavy DOT operations and a lot of those heavy duty equipment that we just can't continue to uh not have charges for them and still have daily operations that they we need to do for for uh the residential areas.

The other opportunities, so we are looking at rent to own, uh, where these are very similar to other rent to own uh opportunities.

We are renting vehicles until at a point where we can ultimately own them.

Granted, over that time frame, we would be paying more than a straight out initial purchase, but that allows us to have lesser of a capital cost to begin with and get the vehicles in a bit faster.

Charging as a service, that would be the city not owning the electric vehicle charging stations.

It is almost similar to a power purchase agreement that we have for our solar energy systems, where another third-party um provider will install and operate and maintain these charges for us.

We just pay the subscription fee, but they take care of all maintenance and the service out of those chargers.

Then charge in the wild, that's what we call it.

It's trying to get open purchase orders for those vehicle charging stations that you're seeing at the strip malls, at the parking lots, the third-party parking lots.

It's just another opportunity where if they're available and our city fleet vehicles can charge there, definitely not convenient.

It could be more expensive down the road, and it is subject to availability.

But these are more the creative options where if we can't get the initial capital costs and the chargers installed in our city facilities, these are the other options that we're looking for.

The fleet and for the charging equipment.

With that, that concludes our presentation, and we are open to any questions.

Thank you.

Uh I I, as you know, I've been looking forward to seeing this detail for a while, so thank you for the thorough report.

I don't think we have any members of the public here, so we'll come back to the committee.

Don't see any hands raised, so I'm gonna ask some questions.

Um, are our options for medium and and um uh heavy-duty EVs starting to get better?

I'm I know that that's been a big limitation that there's been this requirement to do it, but there's not a lot available.

Are things starting to get better?

Yes and no, and I'm gonna partially answer the question, Sherry Cohen, and then I'll um transition it to David Mesa uh to um um to completely answer the question.

There are manufacturers that continue to evolve their technology, whether it's prototypes or those that have really hit the market as a market available vehicle.

Uh similarly to your inquiries back in October, the um tractor drawn aerial, so the ladder trucks in the fire department, uh, they don't have an all electric equivalent as yet, but the water pumper trucks do, and that's something that as we're looking at future procurements, that'll be something that we'll be looking at an electrified fleet option for those vehicles.

Then you have the other side of the coin where outside of California and the very few states that still have a very stringent EV regulations and compliance uh rules.

Um many other states don't.

And when it comes to manufacturing, some of the manufacturers are not seeing the market available for them.

So just using Ford as an example, as you may have heard in September of last year, Ford stopped making the F 150 Lightning, the all-electric uh pickup truck.

And that was something that we are buying quite a bit of just based on the operations needed here.

Because Ford and through many ultra all the factors of all to you, one of the main factors was they just weren't getting enough sales, maybe outside of California.

Uh they just weren't getting enough.

And they've halted that production.

Uh that really limited us then to just then the all-electric sh uh Chevy Silverado.

Unfortunately, we can't afford Rubian.

The price point is gearing us towards uh the Silverado.

But then even at that, the competition to get the EV Silverados than across all municipalities within California, we're all competing for the same set amount of availability.

So with that, um, although we'd like to hope that as uh more of these regulations are in place, uh that would prompt more of the manufacturers to build and make available and stay in business.

Uh versus well, we're kind of seeing yes, that is coming to the forefront and there are emerging technologies.

Then for other common technologies and very common vehicle types, those unfortunately are being halted in their production.

Okay.

Um on the funding side, you mentioned grants.

Are the are most are these you said mostly DOT, but are there some st does the state provide any funding to help achieve the goal that they've set?

Uh we are looking at any available um incentive programs, uh, whether it's through the state.

We we are still pursuing federal grants as they're made available as well to you.

Uh but anything that we are seeing, we have been applying um and we're getting consideration.

It's helpful also as we're going in a joint effort.

So whether it is with other county partners, really showing the bigger need uh within the region and getting more consideration there.

There is more weight for those that are applying with the LIDAC in mind, the low-income disadvantaged communities, where if we're looking at a combined shared charging infrastructure for both municipal fleet and members of the public, uh, and even employees.

Employees are buying more uh electric vehicles as well too, and providing an opportunity for them.

Uh those are where we're seeing more of the opportunities for those continued grants, and we are still identifying and applying for those.

Yes.

I would hope that Prop 4 and Cap and Trade money would be available for this.

I'm not just curious.

Um, the the state is saying phase out by 2040.

Phase out doesn't just mean that's the point at which of all purchases have to be.

It's supposed to be that all vehicles that are not EVs are f are decommissioned by then, correct?

But clearly the lifestyle lifespan of a lot of these vehicles is longer than 15 years.

2040 seems a long way off, but it isn't for the purchase of a vehicle.

So that's correct.

And that's why yes.

And that's why we're actually still building a fueling island at the Central Service Yard, because we know the vehicles that were still able to buy now that are unleaded or renewable diesel, they'll still need fuel, even beyond that.

But to your point, um, Chaircoin, within the next 14 years, it's not a matter of whether they can still go, it's a matter of is there one available that's equivalent on the marketplace and forcing that change.

Right, right.

Um did you want I I feel like you're you're stating that like you want to say something.

Yeah, well, I was just gonna mention as Walter said, so we we as fleet management, we we look at every single procurement and do an EV suitable uh uh suitability analysis.

And yes, there are legacy manufacturers and growing manufacturers in the uh medium and heavy duty space that continue to provide products.

We look at the individual vocation to see if the electric vehicle um fit for that location will work.

For an example, like DOT sewers, when they request a a medium-duty truck, they need a large crane to be able to move uh sewer pipes.

That isn't available right now at the marketplace because of the amount of battery would be utilized to move the those big large pipes, so that's something where it doesn't fit right now.

We will continue to, you know, year after year do that suitability as something comes to market, then we can pivot and make that switch.

But then you have like say a just a debris body truck for PRNS or or or public works or DOT where that's available and it's a viable option.

So that's that's where we would look to put them in an electric vehicle at that point.

So we we do continually update and look at these vocational vehicles to see if there's a good fit.

Um the the requirement in the state is 100% purchase by 2030.

So that but that requirement is not just for light duty, right?

It's for all vehicles.

That's just for medium and heavy duty.

For medium and heavy, 100% purchase by 2030.

Yeah, light duty isn't factored into it.

That's just for medium and heavy.

So ACF uh regulatory compliance is for medium and heavy, which is class three to class eight, which is kind of getting into the weeds, but so for those vehicles, that's the requirement.

But there's not really any possibility that we can achieve that.

There's not enough silk choice out there of vehicles to do that.

Right.

Okay.

So it's anyway, just gonna be an interesting point at which we're not in compliant with the rules.

Um interesting run-up to see if the timeline gets pushed back as we get closer to 2030.

Right.

I mean, we we want to keep it moving, but we also have to be realistic.

Um so right now, our are for light duty vehicles.

Are we at 100% on light duty?

Um we are at 100% of replacement.

Of replacement, that's what I mean.

And ads, not the existing fleet.

Right, right.

Uh, what percenta I you said, I mean, I was I was impressed by the number of how many the how much the fleet has grown, light duty fleet has grown.

What percentage of our light duty fleet is now electric?

I don't know that number off the top of my head.

Well, we can fall we could follow.

I mean, is it is it 20 percent, 80 percent?

What is it?

It is about 20 percent ish.

Okay.

But I will follow up with the exact number.

Because as we talk about our goals of being carbon neutral by 2030, you know, obviously we we don't want to necessarily buy vehicles before we have to, and we don't necessarily have the budget for that, but to even think about being carbon neutral by 2030, we should be thinking about having our entire at least what we can electrify be electrified, otherwise we haven't really tried to achieve the goal.

So I'm just one wondering what it would take for us to be a hundred percent, what what you know would there be more invest obviously, more investment needed.

What would it take for us to be a hundred percent of our light duty fleet elect um electric by 2030?

Maybe that's not something you can answer now, but I want to think that through.

That's an interesting challenge because uh whether we to your point, whether we decommission existing assets that still have viable lifespan with just that one goal in mind, and so that's that tricky balance.

And then even if uh Dave and his team can acquire and put in place, then we also have to then decommission all those vehicles at the same time.

So there's that push and pull.

And then do we have the charging infrastructure at the places in which they dwell so that they can charge in the times that they're needed um in place in time for that whole thing to work?

Right.

And just a question that we've set an we've set an ambitious agenda uh goal when we knew that setting an ambitious goal met we would have to do some uncomfortable things to get there.

So I'm just kind of throwing that out there that this is one of those uncomfortable things.

In some sense, it's the one thing that's possible.

There's a lot of other things that that are not even possible.

Um so I just you know want to keep that elevated.

Um, I guess that's that's my last questions.

I'm excited to see the electrified Danny the Dragon.

You know, there were the although I joke about the the old charm of part of the charm being having to breathe in that black plume of smoke that came out of the engine as you were riding in the in the ride, but actually it's better that we don't have that anymore.

The real dragon effect as we call it.

Yeah, exactly.

All right, do we have a motion to accept the report?

So moved.

All right, we have a motion, a second.

I don't see any other hands to ask questions, so we'll vote.

And we can hold the vote for one second for our colleague to uh or we'll let him throw his vote in when he comes out.

So it's right now it's four zero with um Ortiz missing.

And we will move on to item three.

Thank you for the report.

Appreciate it.

Our last item on the agenda today is our clean energy roadmap status report.

Good afternoon, council members.

My name is Lori Mitchell, and I'm the director of the energy department and very pleased today to be joined by Kate Ziemba.

She's our deputy director over accounts, marketing, and communications.

This item is our program's roadmap.

And so today we'll go through a little bit of background on the program roadmap, overview our current programs, as well as recommended changes for fiscal year 206-27.

And then finally, look at our recommendations for the next five years from 2026 through 2031.

Just as background, back in 2021, City Council approved the following guiding principles for our programs roadmap, which are to reduce greenhouse gas emissions, promote equity, increase affordability, and support environmental justice communities, benefit our customers and the community, maintain or improve the financial status of San Jose Clean Energy, and then finally to align with our climate smart city goals.

As background, you saw saw the slide with our rate item a few months ago.

The PCIA is a fee that is charged to our customers to account for the resources that were supplied by the investor owned utility before San Jose Clean Energy launch.

As we noted in 2026, our customers will pay 132 million dollars in this fee.

And we are offsetting that by using a significant portion of our financial reserves.

So in 2026, we anticipate using about 108 million of our reserves to offset that charge.

And in 2027, we think that this charge may remain at almost the same rate as what we're seeing here in 2026.

And so this has informed how we are recommending the budget for our customer programs.

Over the last year, we have spent about 10 million dollars on our customer programs, which is great progress.

And so what we're recommending is to keep that spend the same next year and to overall have a stable program budget over the coming years versus expanding it and then retracting it as our financial condition allows.

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

Thank you.

Kate Cebett, Deputy Director with the Energy Department.

So we currently offer 12 programs across four main areas residential electrification incentives and financing, EV charging and transportation programs, customer support, including bill assistance and education, and then demand flexibility.

We also offer three workforce development programs.

Last week we launched an incentive for contractors who are new to heat pumps, 1,000 per installation for the first six installations.

We believe this will be an effective tool to help more contractors, including high road contractors, break into the residential heat pump market.

We published the high road badge last fall, which recognizes contractors who pay prevailing wage, offer family health care and benefits, are affiliated with an apprentice program, and ensure their workers have safety certification.

And we developed those criteria with our labor stakeholders and have presented to contractors about the badge in our programs, and we'll continue to conduct outreach.

We're committed to helping our local workforce prepare for the air district regulations and doing our part to ensure decarbonization jobs are high quality.

Through the end of 2025, we estimate our programs will save customers 29.4 million in lifetime savings and avoid more than 46,000 metric tons of CO2 and save 35 million kilowatt hours of electricity.

Through our programs, customers have installed more than 300 chargers, bought 113 EVs, installed more than 1,100 heat pumps, and 107 battery storage systems, and together have created nearly uh two megawatts of flexible load to help stabilize the grid on high usage days.

And now we'll go into our recommended programs for next fiscal year.

Let's start first with how we arrived at our program recommendations.

We want to create energy programs that our community wants and needs.

We have a staff member who's dedicated to community engagement and conducting needs assessments.

We also receive input from the climate advisory commission and collaborate with other CCAs and utilities to understand their most impactful programs.

And so we put together program ideas through our scoring framework to help prioritize, and we calculate scores for programs using five metrics that map to our program guiding principles.

And so what we're presenting is a recommended recommended programs reflect the highest scores.

As Lori mentioned, we recommend spending a maximum of 10 million on programs next year given the PCIA.

And we recommend continuing to offer the 12 programs on the previous slide.

We continually iterate these programs, learn from what we're seeing and from others to improve them.

We propose to add two new programs to fill gaps.

The first is providing free technical assistance for our commercial customers to help them electrify their buildings and implement energy efficiency with a special track for restaurants and food service, which are typically very high energy users.

The second is a pilot program for renters that offer a low or no cost portable heat pump to help provide cooling to units that don't have it and efficient heating.

We estimate that implementing these programs the next fiscal year will save customers 16 million in lifetime savings and avoid more than 33,000 metric tons of CO2.

This year we're also excited to produce a five-year programs roadmap.

In 2021, Energy Department first published the programs roadmap that outlines the types of programs SJCE may pursue over the coming years.

And we committed to updating it every five years.

And so here we are today to present another recommended update covering 2026 to 2031.

The roadmap provides the strategic direction and options for programs, and then we continue annually to conduct detailed prioritization and program design and bring those recommendations to the city council.

For this roadmap update, we conducted two residential surveys in multiple languages.

The first was to understand energy needs and barriers, and then one at the end of the engagement process to make sure we heard the community right and hear reactions to our proposed programs.

We also conducted three residential listening sessions in English, Spanish, and Vietnamese, and then finally we reached out to more than 80 stakeholders across multiple fields, business, community-based organizations, environmental groups, labor, and city departments.

And we value our stakeholders and their input is reflected here.

So a bit about what we heard.

Customers really want to adopt clean energy technologies to unlock lower bills, but the upfront cost of that technology is often a barrier.

Housing constraints are also a barrier, particularly for renters and multifamily customers.

And while we heard that there's broad support for energy programs, customers emphasize a strong desire for bill savings, renter options, and simple participation.

And so the programs roadmap contains a list of 23 potential programs to explore over the next five years.

The overarching themes are focusing on affordability, accelerating adoption of EVs, heat pumps, solar, expanding access to charging, and using demand flexibility to reduce costs for all and support the grid.

So before wrapping up, we wanted to take a moment to thank the stakeholders who informed the roadmap for their time, expertise, and feedback.

So our recommendation today is to accept this update on the program's roadmap and recommend this item for full council consideration at the May 19th meeting.

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

Thank you.

All right, thank you.

I think we still don't have public comments, so we will come back to the committee.

I have just a few questions.

This past year we implemented the um the incentive for the installer as part that that's rolled under, I assume the heat pump rebate program that's the line item here on the list.

Thank you, Councilmember.

Um the incentive for installers, we actually just launched that last week and we include it as a workforce development program.

Oh, that's under the workforce development.

So that what was it, a thousand dollar for the first five or whatever, so that'll be under that program.

Yes, correct.

And it just started, so we don't have any, we'll find out soon whether how many people start taking advantage of it.

Yes.

Okay, great.

Um the ongoing um $10 million a year that you're sort of recommending this year.

The fact that it's 10 million is partly due to the high PCIA.

If if PCIA drops again, and we hope we hope that things will get under control in the PCIA, would we be have more resources available to increase the programs going forward?

Yeah, that's a great question.

So, yes, um, you know, if the PCIA was lower, we would likely be here today recommending an expansion to our customer programs.

Um, but we think it's prudent to keep it at a stable amount so that we're not going up and down every year.

And and you know, our customers can count on uh a certain amount of customer programs for us.

I I will say it will always be a trade-off between rates and what we're putting into to customer programs, and those decisions will, you know, obviously always come to the city council.

Yeah, I mean, obviously we've we've seen that there's a there's some skepticism among some people, but as time goes on, my thinking is that there will be more and more people wanting to adopt this technology and that the potential customer base will grow, especially as people get more people take start doing it and they start sharing their experience with others.

I I suspect we might see demand increase for these programs.

So that's why I just want to think forward about how we might handle it if that demand grows over time, especially if if the um air district holds on their policies and we begin requiring they be they really do phase out the availability of gas appliances.

Um we'll have more people that want to apply for our rebate.

Yeah, I I think that's an excellent point.

Um I think already we're seeing a lot of demand for these types of technologies, which is great.

And you know, as we can expand our customer programs to um help more people access these technologies, that's certainly something we'll always be supportive of.

You know, right now we are um recommending uh a large uh portion of our customer programs go to um income need um in terms of our our customers so that we can close those gaps for people, but we know that there's a broad broad array of customers that want to participate in our programs and and in general we'd love to expand them.

All right, and my my last question is on well, second to last question, but table five in the report is estimated potential emission reductions and has the numbers growing modestly over the next five years.

Um I'm just curious, so these numbers are the actual one times the the the incremental addition to the savings, but there's ongoing savings as well.

These are not cumulative numbers, are they doing a take that?

Yes, so in each um year, the savings is due to um whatever equipment is being installed in that year.

So it's um the total savings over the lifetime of that equipment, so the total so these are lifetime savings counted on the first year of when they're installed.

Correct.

Okay, all right, makes sense.

Thank you.

And then my last kind of question, it's a little bit on the side, it's not necessarily related to this, but over the weekend I was exposed to this idea of community solar.

Um that people who can't necessarily do it on their own roof or their renters and they want to buy into solar can buy into an installation somewhere, kind of like a timeshare almost.

Uh are do we have have we heard about any demand or interest in that kind of programming here in San Jose?

Yeah, no, there's a a lot of interest in that in that.

We run a program that's similar to that for income qualified, um, and I'll let Kate speak to that.

So there's that option where they're you know essentially taking a portion of a renewable energy project that's located somewhere else.

There's also a bill going through the legislature, which is pretty exciting that's uh termed balcony solar where a customer could buy a solar panel from a Home Depot or some type of store like that, and it actually fits over a balcony and you can plug it into your your socket inside.

Um that type of technology is already being used over in Europe, so we're watching that bill, and you know, that'll be interesting, particularly for renters and multi-family buildings.

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

Thank you.

So our solar access program is actually one of our longest running programs.

We launched it in 2021.

Um that's a community solar type program.

It's entirely funded by the CPU C.

And so about 950 customers each month get a 20% discount on their whole bill.

Um, and then we source 100% solar from them from a small array in Merced County.

Okay, that's great.

Yeah, I mean it's a pretty neat idea that people could say, I want to buy solar, but I can't put it on my house.

Um, and then they can even take it with them when they move from place to place, right?

They don't have to if they're renters, they don't have to have it fixed to the home that they're renting.

Right, right, exactly.

You know, it's something we're supportive of, and then of course I'll plug our total green product, which if people are interested in having a hundred percent renewable energy, we can source that for them.

Cost about five dollars a month on your bill.

So um, you know, that's always an option for customers and importantly, um, people can opt in and out of that program.

So if they can afford it today, they can be in our total green.

And if you know, in a a year or two, that doesn't make financial sense for them, they can always go back to green source.

So that's always a great option for a community as well.

Great, great.

Okay, I see uh Council Mr.

Compost, your hand went up.

Thank you, Chair.

I will move to accept the staff recommendations.

And just with one quick question, thank you for providing this update.

And I'm remembering maybe at last year conversation with council about the I don't know if you call it a reimbursement, but I know right now my we have like San Jose Clean Energy gift card.

Last year the conversation was around are there alternative ways that we when we have a surplus maybe could be reinvesting that in our community.

And so if council wanted to provide an alternative way of using those surplus credits or dollars, is the May 19th city council meeting the appropriate meeting for that recommendation, or what would be the steps and pathway to start to have that conversation about alternative ways of um of using those savings.

Sure, I I think in May that would be an appropriate time.

Also happy to work with your office in advance of that if there's something specifically you're thinking about.

But if I'm understanding you, you would like a bill credit or a or a gift card or something like that for certain types of customers instead of maybe a rate discount or another type of customer program.

Is that what you're thinking of?

No, I so I think this was when we had councilmember Solace uh with us on council, and I think it was something that he brought up.

We are when we have a surplus, I think the um automatic way of redistributing those excess dollars or those savings was to just allocate every ratepayer some kind of card.

Like I have a gift card at my house.

It's like a VSA card, $30, $50, something like that.

It c it I I guess I'm bringing it up because I'm thinking about when California had like the stimulus cards that went out statewide, and now the state is reporting there's like four million, 40 million, I don't know, some several million dollars that have not been used.

I'm just remembering that conversation and thinking about how there was some interest from council in if these dollars could have an alternative way of maybe um being utilized for the you know, whatever it is that council wants to use.

I'm just curious about um where that would be appropriate, where that conversation would be appropriate.

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

Yeah, um, so on May 19th, what the council will be considering is this program roads map.

And so the recommendation from staff will be as it is today to um accept and approve the report, which will allow us to launch these programs.

Certainly um we could consider an additional program.

I I think what you're talking about for your gift card is one of our um programs, our demand response program, where if you participate in it, you save energy and and some of that is credited back to you, which I'll let Kate talk in a little more detail about.

But in terms of a surplus, we we typically do not have have a surplus.

If we do um, you know, we'll recommend a uh one of really three things.

One is to put more funds into our financial reserve to offset future increases in the PCI.

So particularly in our early years, we very much focused on building that financial reserve.

The other thing that we would recommend is a is a rate change, so just lowering our rates if um you know we're we're collecting essentially too much, and then finally what we would recommend is an expansion of customer programs.

We typically try to do a mix of those things, right?

Because we think all three are important, having that financial reserve, having competitive rates, and having programs that are valuable to our customers.

So that's typically what we would do with any type of surplus, um, but certainly happy to partner with your office on on a program such as that demand response program or or some other type of program for residents that you're thinking of.

And I'll let Kate talk a little bit about that that gift card program that you're referencing.

Thank you.

Um so we have a program called Peak Rewards, it's a demand response program, which basically means that um during certain days of the year when the grid where there's a lot of demand on the grid, and um we call on our customers to reduce their energy usage.

And so um this can look like it's called behavioral demand response where you know you just don't use your dishwasher or you turn off your lights, and that's how you save energy, or it can be automated where you enroll a smart thermostat, and then that is adjusted wirelessly.

Or it can be automated where you enroll a smart thermostat, and then that is adjusted wirelessly.

But um but good.

I don't see any other hands, so let's vote.