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sr-060909-1h~J ~;,YO, City Council Report Santa Monica City Council Meeting: June 9, 2009 Agenda Item:. d '- To:_ Mayor and City Council From: Eileen Fogarty, Director, Planning and Community Development Department Subject: Contract Amendment for Services Related to the .Economic Analysis and Forecasting for the Land Use & Circulation Element (LUCE) and EIR Recommended Action Staff recommends that City Council authorize the City Manager to execute a contract amendment with Whitney & Whitney, Inc. (Contract #8868) for $80,000 to a total amount not-to-exceed $225,000, for economic analysis services in conjunction with the Land Use and Circulation Element (LUCE) Update. Executive Summary An intensive effort is underway to refine the Land Use and Circulation Element (LUCE) Strategy Framework resulting in a Final LUCE. The LUCE will reflect the direction from Council, transportation modeling, fiscal analysis, investigation of implementation strategies, and continued community outreach. To this end, the City has also initiated aspects of the environmental review process in compliance with the California Environmental Quality Act (CEQA). To ensure that the community vision as expressed through the LUCE can become a reality, the land use planning effort considers economic and market trends affecting Santa Monica. The .economic analysis performed by Whitney & Whitney will provide additional dimensions to inform the City Council's decision-making on the Final LUCE, including assistance with forecasting, updated market information, comparative economic analysis of alternatives, peer review of strategies for implementation and refinement of economic strategies to achieve community goals. These studies will assist the City Council in the consideration of alternatives, and confirmation of policy directions in the LUCE and implementing actions. The firm of Whitney & Whitney has expertise in the Westside market, and Santa Monica in particular, and was an important resource in development of the Strategy Framework, including drafting the economic sustainability chapter, and the plans, programs and policies to ensure fiscal sustainability. The contract amendment for Whitney & Whitney is necessary to continue to benefit from the firm's expertise as the LUCE is refined. The amount of $80,000 is available in the 1 current year (FY 08-09) budget, and brings the total not-to-exceed contract amount to $225,000. Background The LUCE Update has been a high priority for the City Council. The City Council approved the LUCE Strategy Framework with revisions in July 2008. The Framework identifies an integrated land use and transportation strategy for Santa Monica that conserves residential areas. The Strategy Framework is being refined based on City Council direction, transportation modeling, fiscal analysis, investigation of potential implementation strategies, and continued community outreach. This multi-pronged effort incorporates the environmental assessment, in compliance with CEQA requirements, including evaluation of alternatives and assessment of outcomes. Effective land use planning demands consideration of economic and market trends affecting Santa Monica to ensure that the community vision as expressed through the Final LUCE can become a reality. For example, it is critical to understand where the market would lead without intervention, or where public effort is necessary to achieve specific goals. These efforts are best done simultaneously and revisited periodically as markets are fluid and change over time. Economic analysis will inform the Council as to how it is possible to achieve the LUCE goals and objectives for a sustainable economy, benefit neighborhoods adjacent to commercial and transit corridors, and create affordable and workforce housing. As part of this stage in the LUCE process, the City is performing comparative analysis at the macro-scale through acity-wide fiscal analysis and at the micro-scale through testing of implementation alternatives. These analyses can be used in the consideration of alternatives and to confirm the rationality of policy directions in the LUCE and implementing actions.. The professional services provided by Whitney & Whitney are assisting in these analyses. 2 Discussion Whitney & Whitney has been a valuable resource for the City through the development of the LUCE Strategy Framework chapter on economic sustainability, including the plans, programs and policies to ensure fiscal sustainability. The proposed contract amendment will allow continued involvement and assistance in economic refinement of the land use planning effort, and will set the stage for the future implementation strategies. such as the Zoning Ordinance update. Specifically, the primary tasks to ground the refinements of the LUCE in market conditions include: • Continued assessment of existing and future market conditions, including retail and commercial trends, and continued assessment of market opportunities, • Comparative analysis of implementation alternatives to ensure they are realistic and economically feasible, and consideration of phasing strategies, • Continued assistance in forecasting for the LUCE horizon year of 2020 and technical resolution of State and County data sources, • Assistance and peer review for comparative analysis of pro-forma testing, and assist in the formulation of economic strategies to ensure positive effects on the community are provided as part of changes in activity centers and along commercial transit corridors, • Assistance and peer review of fiscal analysis to facilitate a meaningful comparison between the LUCE policies and EIR alternatives, including incorporation of the potential efficiencies of concentrating new development in specific locations associated with transit and other public services, • Provide detailed market knowledge of West Los Angeles and Santa Monica subareas as a foundation for economic analysis, • Prepare presentation materials to summarize key economic findings, strategies and recommendations. Contractor/Consultant Selection City Council approved the original contract with Whitney & Whitney, Inc. for professional services on December 11, 2007. An RFO was distributed to five firms to procure additional economic and financial expertise in order to develop a list of qualified consultants. Whitney & Whitney has extensive public and private sector experience, and a detailed knowledge of market and financial conditions in the Westside of Los Angeles, 3 particularly in the areas of financial analysis and market forecasting. Mr. Whitney has established both a national and international presence, and participated as a panelist in the LUCE Industrial Lands workshop prior to being retained as a consultant. Budget/Financial Impact. Funds of $80,000 are available in account 01265.555060 after aone-time transfer of $80,000 from Salaries and Wages in account 01265.511680 due to vacancies. Prepared by: Francie Stefan, Community & Strategic Planning Manager Approved: Director, Pta~fiing Development Dep Forwarded to Council: ,,~~'''''-- .'w. ~ r ~, P. ont Ewell City Manager 4 State of the Utility System in Santa Monica Southern California Edison Mark Olson Local Public Affairs June 2009 C Environmental Energy Policies AB 32 CA Global Warming Solutions Act of 2006 33% renewable portfolio standard by 2020 SB 1368 SB 1078 and AB 380 20% renewable generation by 2010 Greenhouse Gases Emission Performance Standard SCE: Investing in the Future • 45,000 - 50,000 new customers annually, historically • 12,000 new customers this year due to economic downturn • Will invest $20 billion during next 5 years to help reduce the nation's dependency on foreign oil • SCE grid enhancement to include: - Installing new poles, wires and substations, as needed - Installing more than five million new technologically advanced meters fry Investing in Cleaner, Smarter Energy for the Future • Electric Plug-in Hybrid Vehicles • Technology for Electrifying the Port of Long Beach • Smart Circuits • Edison SmartConnectT"' Advanced-metering program • Smart Transmission Initiative SCE Investment in i • 2009-2010 In the City of Santa Monica, SCE is investing or planning to invest, build, construct.... • 5 High Voltage Underground Switches to Replace • 4 High Voltage Underground Cable Replacements • 7 Replace Overhead Equipment • Replace Poles - As Determined • Continued Inspection and Maintenance Upgrades • Utility Underground Project - 18t" Street/20t" Street/Ashland Place Leader in Procuring Clean, Renewable Energy SCE has the largest portfolio of renewable generation in the nation SCE's Diverse Portfolio: Power Mix Comparison 0 ,~~,___ 100% 100% Nature SCE 2007' California 20072 US 20073 Total 42% 39% 27% Tehachapi Renewable Transmission Project TI"1T1'1 . _ ._11 _I _1 w r~~ w e~ n i ~ 2009 SCE Rate Forecast • Electric rates are increasing nation-wide • Rate changes will help SCE maintain reliability while building a cleaner, smarter more efficient electric grid for the future • Increases will vary according to customer type and usage • SCE always looks to reduce its operational costs before seeking rate increases • SCE offers many money-saving, energy-efficiency and conservation programs and services SCE Energy-Efficiency Programs and Services Award-winning, energy saving customer programs for homes and businesses Energy-efficiency rebates for pool equipment, heating and air conditioning, lighting and appliances CARE and FERA Programs to provide financial relief for income-qualified households Local government energy partnerships Summary ^ SCE is streamlining its operations and enhancing its electric grid to make it cleaner and smarter to meet the regions' ever increasing demand for power ^ We will continue to be a leader in procuring power from renewable generation sources to protect the environment and reduce the state and the nation's dependency on foreign oil ^ To help our customers use energy wisely and lower their electric bills, SCE offers a variety of conservation tips and energy-efficiency programs and services ^ We are committed to partnering with city leaders, civic and community-based organizations, business owners and residents to reduce or eliminate the impact of project operations on local communities For more information: Please visit www.sce.com or call me: 310-315-3201 CA's Investor-Owned Electric Utilities PaWt]~c bas and Eta[Krds. tavn,pany ~ Sal~ram~M~muntEtp1111d01(IlyDtshitt 5an61agcGaxarud£@actrte SautlWaxn Ca11FamIp 8dlson '~ SaUth~errrGB~lfmttlgl'o~t,Ctianper6y Reference Amendment to Contract No. 8868 (CCS).