HomeMy WebLinkAbout26-145 Willdan Financial Services for BMR Inclusionary Housing Study and In Lieu Fee UpdateCITY OF
a PROFESSIONAL/CONSUL TING SERVICES AGREEMENT
CUPERT INO
1. PARTIES
This Agreement is made by and between the City of Cupertino, a municipal corporation ("City"),
andWilldan Financial Services ("Contractor"), a....;C=-o=rpc.c...=o..ccra=t=io:c:n;:..._ ____ _
for BMR Inclusionary Housing Study and In Lieu Fee Update
and is effective on the last date signed below ("Effective Date").
2. SERVICES
2.1 Contractor agrees to provide the services and perfonn the tasks ("Services") set forth in
detail in Scope of Services, attached here and incorporated as Exhibit A. Contractor further agrees
to carry out its work in compliance with any applicable local, State, or Federal order regarding
COVID-19.
2.2 Contractor's duties and services under this agreement shall not include preparing or
assisting the City with any portion of the City's preparation of a request for proposals, request for
qualifications, or any other solicitation regarding a subsequent or additional contract with the City.
The City shall at all times retain responsibility for public contracting , including with respect to
any subsequent phase of this project. Contractor's participation in the planning, discussions, or
drawing of project plans or specifications shall be limited to conceptual, preliminary, or initial
plans or specifications. Contractor shall cooperate with the City to ensure that all bidders for a
subsequent contract on any subsequent phase of this project have access to the same information,
including all conceptual, preliminary, or initial plans or specifications prepared by contractor
pursuant to this agreement.
3. TIME OF PERFORMANCE
3.1 This Agreement begins on the Effective Date and ends on-=J-=u~n.,,_e-"'3-"-0"-'2::.c0,.,,2"-'7'------
("Contract Time"), unless terminated earlier as provided herein. The City's appropriate department
head or the City Manager may extend the Contract Time through a written amendment to this
Agreement, provided such extension does not include additional contract funds. Extensions
requiring additional contract funds are subject to the City's purchasing policy.
3.2 Schedule of Performance. Contractor must deliver the Services in accordance with the
Schedule of Performance, attached and incorporated here Exhibit B.
3 .3 Time is of the essence for the performance of all the Services. Contractor must have
sufficient time, resources, and qualified staff to deliver the Services on time .
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4. COMPENSATION
4.1 Maximum Compensation. City will pay Contractor for satisfactory performance of the
Services an amount that will based on actual costs but that will be capped so as not to exceed
$ 61 920 ("Contract Price"), based upon the scope of services in Exhibit A and
the budget and rates included in Exhibit C, Compensation attached and incorporated here. The
maximum compensation includes all expenses and reimbursements and will remain in place even
if Contractor's actual costs exceed the capped amount. No extra work or payment is permitted
without prior written approval of City.
4.2 Invoices and Payments. Monthly invoices must state a description of the deliverable
completed and the amount due for the preceding month. W ithin thirty (30) days of completion of
Services, Contractor must submit a requisition for final and complete payment of costs and pending
claims for City approval. Failure to timely submit a complete and accurate payment re quisition
relieves City of any further payment or other obligations under the Agreement.
5. INDEPENDENTCQNJRACJQB
5.1 Status. Contractor is an independent contractor and not an employee, partner, or joint
venture of City. Contractor is solely responsible for the means and methods of performing the
Services and for the persons hired to work under this Agreement. Contractor is not entitled to
health benefits, worker's compensation, or other benefits from the City.
5.2 Contractor's Qualifications. Contractor warrants on behalf of itself and its subcontractors
that they have the qualifications and skills to perform the Services in a competent and professional
manner and according to the highest standards and best practices in the industry.
53 Permits and Licenses. Contractor warrants on behalf of itself and its subcontractors that
they are properly licensed, registered, and/or certified to perform the Services as required by law
and have procured a City Business License, if required by the Cupertino Municipal Code .
SA Subcontractors. Only Contractor's employees are authorized to work under this
Agreement. Prior written approval from City is required for any subcontractor, and the terms and
conditions of this Agreement will apply to any approved subcontractor.
5.5 Tools, Materi als, and Equipment. Contractor will supply all tools, materials and
equipment required to perform the Services under this Agreement.
5.6 Payment of Benefits and Taxes. Contractor is solely respons ible for the payment of
employment taxes incurred under this Agreement and any similar federal or state taxes. Contractor and
any of its employees, agents, and subcontractors shall not have any claim under this Agreement or
otherwise against City for seniority, vacation ti me, vacation pay, sick leave, personal time off,
overtime, health insurance, medical care, hospital care, insurance benefits, social security, disability,
unemployment, workers compensation or emp loyee benefits of any kind. Contractor shall be solely
liable for and obligated to pay directly all applicable taxes, fees , contributions, or charges applicable
to Contractor's business including, but not limited to, federal and state income taxes . City shall have
no obligation whatsoever to pay or withhold any taxes or benefits on behalf of Contractor. ln the eYent
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that Contractor or any employee, agent, or subcontrac tor of Contractor providing services under this
Agreement is determined by a court of competent jurisdiction, arbitrator, or administrative authority,
including but not limited to the California Public Employees Retirement System (PERS) to be eligible
for enrollment in PERS as an employee of City, Contractor shall indemnify, defend, and hold harmless
City for the payment of any employee and/or employer contributions for PERS benefits on behalf of
Contractor or its employees, agents, or subcontractors, as well as for the payment of any penalties and
interest on such contributions, which would otherwise be the responsibility of City, and actual
attorney's fees incurred by City in connection with the above.
6. PROPRIETARY/CONFIDENTIAL INFORMATION
In performing this Agreement, Contractor may have access to private or confidential information
owned or controlled by the City, which may contain proprietary or confidential details the
disclosure of which to third parties may be damaging to City. Contractor shall hold in confidence
all City information provided by City to Contractor and use it only to perform this Agreement.
Contractor shall exercise the same standard of care to protect City information as a reasonably
prudent contractor would use to protect its own proprietary data.
7. OWNERSHIP OF MATERIALS
7.l Property Rights. Any interest (including copyright interests) of Contractor in any product,
memoranda, study, report, map, plan, drawing, specification, data, record, document, or other
information or work, in any medium (collectively, "Work Product"), prepared by Contractor in
connection with this Agreement will be the exclusive property of the City upon completion of the
work to be performed hereunder or upon termination of this Agreement, to the extent requested by
City. In any case, no Work Product shall be shown to any third-party without prior written approval
of City.
72 Copyright. To the extent permitted by Title 17 of the U.S. Code, all Work Product arising
out of this Agreement is considered ''works for hire" and all copyrights to the Work Product will
be the property of City. Alternatively, Contractor assigns to City all Work Product copyrights.
Contractor may use copies of the Work Product for promotion only with City's written approval.
73 Patents and Licenses. Contractor must pay royalties or license fees required for authorized
use of any third party intellectual property, including but not limited to patented, trademarked, or
copyrighted intellectual property if incorporated into the Services or Work Product of this
Agreement.
7.4 Re-Use of Work Product. Unless prohibited by law and without waiving any rights , City
may use or modify the Work Product of Contractor or its sub-contractors prepared or created under
this Agreement, to execute or implement any of the following:
(a) The original Services for which Contractor was hired;
(b) Completion of the original Services by others;
(c) Subsequent additions to the original Services; and/or
(d) Other City projects.
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7.5 D eliver ables and Format. Contractor must provide electronic and hard copies of the Work
Product, on recycled paper and copied on both sides, except for one single-sided original.
8. RECORDS
Contractor must maintain complete and accurate accounting records relating to its performance in
accordance with generally accepted accounting principles. The records must include detailed
information of Contractor's performance, benchmarks and deliverables , which must be available
to City for review and audit. The records and supporting documents must be kept separate from
other records and must be maintained for four (4) years from the date of City's final payment.
Contractor acknowledges that certain documents gen erated or received by Contractor in
connection with the performance of this Agreement, including but not limited to correspondence
between Contractor and any third party, are public records under the California P ub lic Records
Act, California Government Code section 6250 et seq. Contractor shall com ply with all laws
regarding the retention of public records and shall make such records available to the City upon
request by the City, or in such manner as the City reasonably directs that such records be provided.
9. ASSIGNMENT
Contractor shall not assign, sublease, hypothecate, or transfer this Agreement, or any interest
therein, d irectly or indirectly, by operation of law or otherwise, without prior written consent of
City. Any attempt to do so will be null and void. Any changes related to the financial control or
business nature of Contractor as a legal entity is considered an assignment of the Agreement and
subject to City approval, which shall not be unreasonably w ithheld. Control means fifty percent
(50%) or more of the voting power of the business entity.
10. PUBLICITY t SIGNS
Any publicity generated by Contractor for the project under this Agreement, during the term of
this Agreement and for one year thereafter, will reference the City's contributions in making the
project possible. The words "City of Cupertino" will be displayed in all pieces o f public ity,
including flyers, press releases, posters , brochures, public service announcements, interviews and
newspaper articles. No s igns may be posted, exhi bited or d isplayed on or about City property,
except signage required by law or this Contract, without prior written approval from the City.
INDEMNIFIC ATION
11.1 To the fullest extent allowed by law, and except for losses caused by the sole and active
negligence or willful misconduct of City personnel, Contractor shall indemnify, defend and hold
harmless City, its City Council, boards and commissions, officers , officials, employees, agents,
servants, volunteers, and consultants ("Indemnitees"), through legal counsel acceptable to City,
from and against any and all liability, damages, claims, actions, causes of action, demands,
charges, losses, costs, and expenses (including attorney fees, legal costs, and expenses related to
litigation and dispute resolution proceedings) of every nature, arising directly or indirectly from
this Agreement or in any manner relating to any of the following :
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(a) Breach of contract, obligations, representations, or warranties;
(b) Negligent or willful acts or omissions committed during performance of the Services;
(c) Personal injury, property damage, or economic loss resulting from the work or performance
of Contractor or its subcontractors or sub-subcontractors;
(d) Unauthorized use or disclosure of City's confidential and propr ietary Information ;
(e) Claim of infringement or violation of a U.S. patent or copyright, trade secret, trademark,
or service mark or other proprietary or intellectual property rights of any third party.
11.2 Contractor must pay the costs City incurs in enforcing this provision. Contractor must
accept a tender of defense upon receiving notice from City of a third-party claim. At City's request,
Contractor will assist City in the defense of a claim, dispute, or lawsuit arising out of this
Agreement.
11.3 Contractor's duties under this section are not limited to the Contract Price, workers'
compensation payments, or the insurance or bond amounts required in the Agreement. Nothing in
the Agreement shall be construed to give rise to an implied right of indemnity in favor of
Contractor against City or any Indernnitee.
11.4. Contractor's payments may be deducted or offset to cover any money the City lost due to a
claim or counterclaim arising out of this Agreement, a purchase order, or other transaction.
11.5. Contractor agrees to obtain executed indemnity agreements with provisions identical to
those set forth here in this Section 11 from each and every subcontractor, or any other person or
entity involved by, for, with, or on behalf of Contractor in the performance of this Agreement.
Failure of City to monitor compliance with these requirements imposes no additional
obligations on City and will in no way act as a waiver of any rights hereunder. Notwithstanding
the foregoing, Contractor's total liability for claims or losses arising out of the performance of
Services, whether arising out of contract, tort, or otherwise, shall be limited to the amount paid to
Contractor for the services.
11.6. This Section 11 shall survive termination of the Agreement.
12. INSURANCE
Contractor shall comply with the Insurance Requirements, attached and incorporated here
as Exhibit D , and must maintain the insurance for the duration of the Agreement, or longer
as required by City. City will not execute the Agreement until City approves receipt
of satisfactory certificates of insurance and endorsements evidencing the type, amount,
class of operations covered , and the effective and expiration dates of coverage. Failure to
comply with this provision may result in City, at its sole discretion and without notice,
purchasing insurance for Contractor and deducting the costs from Contractor's compensation or
terminating the Agreement.
13. COMPLIANCE WITH LAWS
13.1 General Laws. Contractor shall comply with all local, state, and federal laws
and regulations applicable to this Agreement. Contractor w ill promptly notify City of changes
in the law or other conditions that may affect the Project or Contractor's ability to
~c~ffif~H~1~ffie.@e.trt81InVf,Ii\f&1p& tpcfmePloyment authonzatLOn of employees
performing the Services, as required by the lmmigrat10n Reform and Control Act.
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13.2 Labor Laws. Contractor shall comply with all labor laws applicable to this Agreement. If
the Scope of Services includes a "public works" component, Contractor is required to comply with
prevailing wage laws under Labor Code Section 1 720 and other labor laws.
13.3 Discrimination L aws. Contractor shall not discriminate on the basis of race, religious
creed, color, ancestry, national origin, ethnicity, handicap, disability, marital status, pregnancy,
age, sex, gender, sexual orientation, gender identity, Acquired-Immune Deficiency Syndrome
(AIDS), or any other protected classification. Contractor shall comply with all anti-discrimination
laws, including Government Code Sections 12900 and 11135, and Labor Code Sections 1735,
1777, and 3077 .5. Consistent with City policy prohibiting harassment and discrimination,
Contractor understands that harassment and discrimination directed toward a job applicant, an
employee, a City employee, or any other person, by Contractor or its employees or sub-contractors
will not be tolerated. Contractor agrees to provide records and documentation to the C ity on
re quest necessary to monitor compliance with thi s provision.
13.4 Conflicts of Interes t. Contractor shall comply w ith all conflict of interest laws applicable
to this Agreement and m u st avoid any conflict of interest. Contractor warrants that no public
official, employee, or member of a City board or commission who might have been involved in
the making of this Agreement, has or will receive a direct or indirect financial interest in th is
Agreement, in violation of California Government Code Section 1090 et seq. Contractor may be
required to file a conflict of interest form if Contractor mak es certain governmental decisions or
serves in a staff capacity, as defined in Section I 8700 of T itle 2 of the California Code of
Regulations. Contractor agrees to abide by the City's rules governing gifts to public officials and
employees.
13.5 Remedies. Any violation of Section 13 constitutes a material breach and may result in C ity
suspending payments, requiring reimbursements or terminating this Agreement. City reserves all
other rights and r emedies available under the law and this Agreement, including the right to seek
indemnification under Section 1 1 of this Agreement.
14. PROJECT COORDINATION
City Project Manager . The City ass igns _F_lo_y_A_n_dr_e_w_s _____________ _
as the City's representative for all purposes under this Agreement, with authority to oversee the
progress and performance of the Scope of Services. City reserves the right to substitute another
Project manager at any time, and without prior notice to Contractor.
Contractor Proj ect Ma nage r. Subject to City approval , Contractor assigns James Edison
____________ as its single Representative for all purposes under this
Agreement, with authority to oversee the progress and performance of the Scope of Services.
Contractor's Project manager is responsible for coordinating and scheduling the Services in
accordance with the Scope of Services and the Schedule of Performance. Contractor must regu larly
update the City's Project Manager about the progress with the work or any delays, as required under
the Scope of Services. City written approval is required prior to substituting a new Representative.
15. ABANDONMENT Of PROJECT
City may abandon or postpone the Project or parts therefor at any time . Contractor will be
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compensated for satisfactory Services performed through the date of abandonment, and will be
given reasonable time to assemble the work and close out the Services. With City's pre-approval
in writing, the time spent in closing out the Services will be compensated up to a maximum of ten
percent (10%) of the total time expended to date in the performance of the Services.
16. TERMINATION
City may terminate this Agreement for cause or without cause at any time. Contractor will be paid
for satisfacto1y Services rendered through the date of termination, but final payment will not be
made until Contractor closes out the Services and delivers the Work Product.
17. GOVERNING LAW, VENUE, AND DISPUTE RESOLUTION
This Agreement is governed by the laws of the State of California. Any lawsuits filed related to
this Agreement must be filed with the Superior Court for the County of Santa Clara, State of
California. Contractor must comply with the claims filing req uirements under the Government
Code prior to filing a civil action in court. If a dispute arises, Contractor must continue to provide
the Ser vices pending resolution of the dispute. If the Parties elect arbitration, the arbitrator's award
must be supported by law and substantial evidence and include detailed written findings of law
and fact.
18. ATTORNEY FEES
ff City initiates legal action, files a complaint or cross-complaint, or pursues arbitration, appeal, or
other proceedings to enforce its rights or a judgment in connection with this Agreement, the
prevailing party will be entitled to reasonable attorney fees and costs.
19. THIRD PARTY BENEFICIARIES
There are no intended third party beneficiaries of this Agreement.
20. WAIVER
Neither acceptance of th e Services nor payment thereof shall constitute a waiver of any contract
provision. City's waiver of a breach shall not constitute waiver of another provision or breach.
21. ENTIRE AGREEMENT
This Agreement represents the full and complete understanding of every kind or nature between
the Parties, and supersedes any other agreement(s) and understanding(s), either oral or written,
between the Parties. Any modification of this Agreement will be effective only if in writing and
signed by each Party's authorized representative. No verbal agreement or implied covenant will
be valid to amend or abridge this Agreement. If there is any inconsistency between any term,
clause, or provision of the main Agreement and any term, clause, or provision of the attachments
or exhibits thereto, the terms of the main Agreement shall prevail and be controlling.
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22. INSERTED PROVISIONS
Each provision and clause required by law for this Agreement is deemed to be included and will
be inferred herein. Either party may request an amendment to cure mistaken insertions or
omissions of required provi sions. The Parties will collaborate to implement this Section, as
appropriate.
23. HEADINGS
The headings in this Agreement are for convenience only, are not a part of the Agreement and in
no way affect, limit, or amplify the terms or provi sions of this Agreement.
24. SEVERABILITY/PARTIAL INVALIDITY
If any term or provision of this Agreement, or their application to a particular situation, is found
by the court to be void, invalid, illegal, or unenforceable, such term or provision shall remai n in
force and effect to the extent allowed by such ruling. All other terms and provisions of this
Agreement or their application to specific situations shall remain in full force and effect. The
Parties agree to work in good faith to amend this Agreement to carry out its intent.
25. SURVIVAL
All provisions which by their nature must continue after the Agreement expires or is terminated,
including the Indemnification, Ownership of Materials/Work Product, Records, Governing Law,
and Attorney Fees, shall survive the Agreement and remain in full force and effect.
26. NOTICES
All notices, requests and approvals must be sent in writing to the persons below, which will be
considered effective on the date of personal delivery or the date confirmed by a reputable overnight
delivery service, on the fifth calendar day after deposit in the United States Mail, postage prepaid,
registered or certified, or the next business day following electron ic subm ission:
To City of Cupertino
10300 Torre Ave
Cupertino, CA 950 14
Attention: Floy Andrews
Email: FioyA@cupertino.gov
27. EXECUTION
To Contractor: Willdan Financial Services
66 Franklin Street, Suite 300
Oakland, California 94607
Attention: James Edison
Email: JEdison@willdan.com
The person executing this Agreement on behalf of Contractor represents and warrants that
Contractor has full right, power, and authority to enter into and carry out all actions contemplated
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by this Agreement and that he or she is authorized to execute this Agreement, which constitutes a
legally binding obligation of Contractor. This Agreement may be executed in counterparts, each
one of which is deemed an original and all of which, taken together, constitute a single binding
instrument.
IN WITNESS WHEREOF, the parties have caused the Agreement to be executed.
CITY OF CUPERTINO
A Municipal Corporation
By dft2u&:=----
Name Floy Andrews
Title Interim City Attorney
Date 9/1 0/26
AiTE T:
#.-----
iJA N SAPUDAR
City Clerk
DA TE: qb 1/ z l.
CONTRACTOR
By ~~
Name Chris Fisher
Title Vice President/Director
Date September 1 O. 2026
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Exhibit A -SCOPE OF WORK AND SERVICES
The Consultant will perform under the general direction of the Community Development
Department and consult with other City personnel throughout the course of the work.
PROJECT DESCRIPTION
Cupertino Community Vision 2015-2040: Cupertino General Plan and Municipal Code Chapter
19.172 regulates and imposes an affordable housing mitigation requirement for all new
development within the City. The BMR program includes the provision of affordable units for
rental and ownership housing, and a Housing Mitigation In-Lieu Fee on all non-residential
development which results in a net increase of gross floor area to support the provision of
affordable housing in Cupertino, with certain exemptions identified in the BMR Housing
Mitigation Program Procedural Manual. In addition, the City's BMR program allows residential
rental developments where calculation of BMR units requirements result in "fractional" units
less than 0.5 units, to pay an in-lieu of fee for the fractional unit less than 0.5 unit.
The purpose is to review and update (if necessary) the City's existing Housing Mitigation
Program and related in-lieu fees, including preparation of any necessary nexus analysis,
economic feasibility analysis, fee study, and supporting documentation to ensure the program
is legally defensible and economically feasible. The Consultant shall ensure it is current with
constitutional standards governing land use exactions and development-related fees, state law
and local ordinances, equitable to produce commensurate affordable housing to non-affordable
development, and legally defensible. The nexus study shall be prepared in compliance with (i)
Local Ordinance Authority Law (Cal.Gov. Code §65850), (ii) Density Bonus Law (Cal.Gov. Code
§65915-65918), (iii) the Mitigation Fees Act (Cal. Gov. Code §66000 et. seq.), (iv) relevant
provisions of the City's General Plan, (v) City ordinances, and (vi) applicable constitutional and
statutory standards governing development-related fees, inclusionary housing programs, and
exactions, each as applicable.
The City of Cupertino is committed to studying the Housing Mitigation Program and its current
fee schedule to update development fees to ensure that they remain legally defensible. These
items are enumerated in the Housing Element as HE -2.3.3 (Residential Housing Mitigation
Program) and HE -2.3.9 (Review Impact Fees). The study will provide the technical and legal
basis for any updates to the City's BMR Housing Mitigation Program and in-lieu fee
requirements for all developments which results in a net increase of gross floor area or new
residential units.
PROTECT DELIVERABLES
The City seeks the services of a qualified consultant to prepare all analyses necessary to support
the City's consideration of updates to its inclusionary hous ing program and associated in-lieu
fees, including an evaluation of the existing program, economic feasibility analysis, inclusionary
housing nexus and fee analysis, policy recommendations, stakeholder outreach, public meeting
support, and final technical reports suitable for consideration by the Planning Commis sion and
City Council. At a minimum, the consultant's analyses, recommendations, and deliverables
shall provide the following:
• A current, transparent, and legally defensible Housing Mitigation In-Lieu Fee program that
aligns with City policy, state law, and applicable constitutional standards governing
development-related fees, inclusionary housing programs, and exactions.
• A methodology and fee model the City can maintain and update annually.
• Recommended City Municipal Code or City policy revisions to ensure long-term
compliance and defensibility.
SCOPE OF SERVICES
Basic service will consist of review and update of the City's existing BMR Program and related
in-lieu fees, including preparation of any necessary nexus analysis, economic feasibility
analysis, fee study, and supporting documentation to ensure the program is legall y defensible
and economically feasible. The Consultant shall ensure the BMR Program is current with
constitutional standards governing land use exactions and development-related fees, s tate law
and local ordinances, and is equitable to produce commensurate affordable housing to non
affordable development, and legally defensible w1der direction of the City. The Consultant
scope of services may include, but is not limited to:
Task 1: Project Initiation and Background Review
• Conduct a project kickoff meeting with City staff to confirm objectives, scope, methodology,
and schedule.
• Review relevant documents, including:
o Existing Housing Mitigation program and ordinance.
o City General Plan, particularly the H ousing Element and policies related to BMR
Hou sing
o Current and historical fee schedules, prior nexus studies (including those from other
Santa Clara County cities if available), and other relevant housing project data.
• Confirm compliance requirements under the City's Municipal Code, Local Ordinance
Authority Law, Density Bonus Law, Mitigation Fees Act, and identify any additional
applicable state, local, or constitutional standards relevant to the preparation of a legally
defensible nexus study for development-related fees, indusionary housing programs, and
exactions.
Task 2: Data Collection and Baseline Conditions
• Review the City's current development patterns, demographic forecasts, and progress
towards meeting the City's Regional Housing Needs Allocation {RHNA).
• Verifying whether the City's current BMR Housing requirements (15% very-low and low
for rental projects, 20% median and moderate for ownership projects) is financially feasible
and/or could be amended to increase affordable housing inventory for the lower-income
ranges.
• Evaluate the most recent Hou sing Mitigation Residential and Non-Residential In-Lieu Fees
(as described in 2025 Fee schedule) for task three.
Task 3: Methodology and Fee Calculation
• Develop an updated fee calculation (if applicable) consistent with all applicable federal, state,
and local laws and City policy.
• The current Housing Mitigation In-Lieu Fee is for fractional units less than 0.5 that result
from the BMR Inclusionary Requirement Calculation and is based on the formula:
[(Gross Floor Area x Fee Amount per SF by Development Type) / Below
Market Rate Inclusionary Requirement (15% or 20% of total units provided)]
x Remaining Fraction of BMR Requirement
• Propose a new fee schedule inclusive of all current Fee Amounts Per Square Foot (SF) by
Development Type and adds any additional categories for commonly used categories in
other California jurisdictions not currently covered by the fee schedule.
• Evaluate calculation methods, such as:
o Updated population projections or household composition factors.
o Fluctuations and projections in the housing market for ownership and rental options.
o Comparison with other California jurisdictions.
• Propose a new fee option for a total "fee-out" for rental projects as an alternative to providing
inclusionary BMR units and other necessary alternatives for meeting BMR requirements, in
compliance with applicable law.
• Recommend an economically feasible inclusionary housing requirement that can boost the
City's production of very-low and low income housing within private development for both
rental and ownership housing without impeding development.
• Consider alternative inclusionary housing requirements for housing development projects
that can encourage the development of lower and/or moderate income housing, with
alternatives to include moderate income units.
• Ensure the selected methodology clearly demonstrates proportionality and nexus between
new development and the need for affordable housing.
Task 4: Legal and Policy Review
• Evaluate the City's existing municipal code provisions governing inclusionary affordable
housing and in-lieu fees.
• Recommend ordinance or policy amendments as necessary to align with the updated fee
methodology and legal standards.
• Ensure the final study provides sufficient documentation to be legally defensible,
considering current case law and all applicable federal, state, and local laws.
• Coordinate with City staff and the City Attorney's Office (or designated legal counsel) to
review draft findings.
Task 5: Re porting and Deli verables
• Administrative Draft Report detailing:
o Methodology, data sources, assumptions, and findings.
o Recommended fee schedule by dwelling unit type.
o Supporting technical appendices and legal justification.
• Final Report incorporating City staff review comments.
• Fee Calculation Model (Excel) allowing the City to update values in future years,
particularly to adjust for land costs (with proportional Consumer Price Index (CPI)
increases).
• Presentation to City Council summarizing study findings, methodology, and
recommendations.
In all cases, Consultants will be contracted using the City's standard Professional/Specialized
Services Agreement will be negotiated and executed for the specific duties and/or projects
that require work.
Cover Transmittal Letter
July 28, 2026
Ms. Nicky Vu
Senior Housing Coordinator
City of Cupertino
10300 Torre Avenue
Cupertino, CA 95014
submitted via online to the City of Cupertino
Re: Proposal to Conduct a Nexus Study for Below Market Rate lnclu sionary Housing and In-Lieu Fees for the
City of Cupertino
Dear Ms. Vu:
W illdan Financial Services ("Willdan") is pleased to present this proposal to the City of Cupertino ("City") to conduct a
Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees. Willdan's project approach helps to ensure
the preparation of an impact fee study that will withstand technical challenges and public scrutiny. Given Willdan 's
unmatched impact fee experience, we are particularly well positioned to serve the City and help ach ieve established l ong
term goals. Outlined below are the advantages and benefits that Willdan will provide to the City.
Direct Recent Experience with the City of Cupertino -Willdan is currently partnering with the City on the Park Impact
Fee Study. Mr. James Edison and Carlos Villarreal are conducting the study and are the proposed Project Team for this
engagement. Their direct experience and our ongoing collaboration has deepened our understanding of the City, including
its structures, processes, and policies, whil e fostering relationships with key staff members. We can approach this Study
with insight and perspective that enables us to complete it at a much lower cost than other firms could, while
providing even greater insight and depth of analysis.
Successful project completion. Willdan has successfully completed many impact fee studies, including most recently in
the Cities of East Palo Alto, Mountain View, Santa Clara , Morgan Hill, Alameda, Pacifica, Fremont, Riverbank,
Bakersfield, Pismo Beach, Rocklin, Pomona, Fountain Valley, McFarland, Hollister, and Pismo Beach, as well as
the County of Riverside. These fee programs were approved by their respective Councils. Willdan is also currently
assisting the cities of Grover Beach, Newport Beach, and Ch ino Hills with their fee programs.
Unmatched experience implementing and defending fee programs. Willdan's impact fee staff has assisted more than
100 California government agencies with the development and/or update of all fee types and is fortunate to be in a position
that will provide a tremendous benefit to the City. Each project has required defensible documentation and thorough
coordination of fee program changes for different agency departments and stakehol ders w ithin the business community.
In some cases, Willdan has been required to negotiate fees with stakeholders and, on occasion , defend them in meetings
and public forums.
We are particul arly strong in advising our clients on the advantages and disadvantages of different fe e schedule structures
(citywide versus multiple-fee districts/zones; more versus fewer land-use categories; etc.) and methods of fee calculation
that are based on the City's and stakeholder priorities ..
Willdan would also like to affirm our understanding of the recent Sheetz v. County of El Dorado Supreme Court decision
and subsequent state court decision. The current status of Sheetz is that the state court has uphel d the El Dorado County
fee program as compl iant with federal takings l aw. The upshot of Sheetz is an increase focus on nexus and proportionality,
which have always been our watchwords.
Innovative Methodologies. As Willdan operates nationally, we possess unique experiences in numerous jurisdictions
dealing with multiple challenges. Our abil ity to produce studies that accommodate various options and viewpoints ensures
fair-minded and sensible projects.
T 800.755.6864 I 66 Franklin Street, Suite 300, Oakland, California 94607 I www.willdan.com
Ms. Nicky Vu
City of Cupertino
Proposal to Conduct a Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees
July 28, 2026 I Page ii
Our methodology and approach to impact fees has proven to be effective for Cities and Counties, the development
community, and the public. Utilizing focus groups, with established guidelines, during the study, fully informs the
development community and the public of the justification of the impact fees, and their positive effect on community growth.
Best-in-class impact fee team that can work immediately to prepare an impact fee program. The Willdan team begins
a project by evaluating the agency's current capital planning policies and funding programs. Not all capital projects are
amenable to funding from impact fee programs, and we identify sources that complement fee revenues to fully fund the
capital improvement program. The team's Principal-in-Charge James Edison and Project Manager Carlos Villarreal are
well respected by our clients for their skill in proactively organizing a clear, consensus-based project approach.
The scope and fee included in this proposal will remain valid for a period of 120 days.
We are excited about this opportunity to use our skills and expertise to serve the City of Cupertino. To discuss any aspect
of this submittal, please contact me directly , my information is provided in the table below.
Sincerely,
Contact Information
Proposal[Contact
James Edison , JD , MPP
Managing Principal
66 Franklin Street, Suite 300, Oakland, California 94607
Tel#: (510) 912-4687 I Email: JEdison@willdan.com
WILLDAN FINANCIAL SERVICES
~9.____
James Edison, JD, MPP
Managing Principal
Chris Fisher
Vice PresidenUDirector (Authorized Signer)
COMPREHENSIVE. INNOVATIVE. TRUSTED. ,,w:
City of Cupertino, California
Title Page and Table of Contents
Title Pag e
W W ILLDAN
Nexu s St u dy for Below Market Rate l nclusionary
Housing and In -Lieu Fees
WILLDAN
FINAN CIAL SERV I CES
66 Frankl in Street, Suite 300
Oakland , Cal ifornia 94607
Tel : (800) 755-6864 1 Fax: (951) 587-3510
Contact Person:
James Edison , JD, MPP
Managing Principal
Email : JEdison@Willdan.com I Tel#: (800) 755-6864
July 28 , 2026
Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees iii
City of Cupertino, California
Table of Contents
Cover Transmittal Letter ................................................................................................................................................................... i
Title Page and Table of Contents ............................................................................................................................................... iii
Title Page ................................................................................................................................................................ iii
Table of Contents ................................................................................................................................................... iv
Consultant Qua l ifications and Experience ............................................................................................................................. s
Firm Profile .............................................................................................................................................................. 5
Exper ience and Expertise ...................................................................................................................................... 6
Staff Qualifications and Experience .......................................................................................................................................... 7
Project T eam ............................................................................................................................................................ 7
Staff Continu ity ....................................................................................................................................................... 7
Resumes .................................................................................................................................................................. 7
James Edison, JD, MPP, MA .................................................................................................................................... 8
Carlos Villarreal, MPP ............................................................................................................................................... 9
Similar Projects .................................................................................................................................................................................. 10
Refer ences ............................................................................................................................................................. 1 0
Recent Studies ...................................................................................................................................................... 11
Project Understanding and Approach .................................................................................................................................... 13
Work Plan ............................................................................................................................................................... 17
C ity Staff Suppo rt .................................................................................................................................................. 18
Project Disclaimer ................................................................................................................................................. 18
Cost Proposa l ...................................................................................................................................................................................... 20
Housing and In-Lieu Fees .................................................................................................................................... 20
Hourl y Rates .......................................................................................................................................................... 20
Contract Acceptance ....................................................................................................................................................................... 21
Project Schedule ................................................................................................................................................................................ 21
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees iv
City of Cupertino, California
Consultant Qualifications and Experience
The requested information is noted in the table below.
Legal Name &
Headquarters Address
Type of Entity
Project Location
DUNS
Willdan Financial Services
27368 Via lndustria, Suite 200 I Temecula, California 92590
(951) 587-3500 I Fax (951) 587-3510
Willdan Financial Services is a California "C" Corporation.
66 Franklin Street, Suite 300, Oakland, Cal ifornia 94607
620658823
Michael Bieber
Chief Executive Officer/WGI
Mark J. Risco
President and CEO
Creighton K. Early
Chief Financial Officer/WGI
Chris Fisher
Organization
Structure and
Company Officers
Vice President/Director
Gladys Medina-Ceballos
Vice President/Director
Firm Profile
Jason Gray
Vice President/
Managing Principal
Daryl! Parker
Vice President/
Managing Principal
Willdan Financial Services is an operating division within
Willdan Group, I nc. (WGI), which was founded in 1964 as an
engineering firm working with local governments. Today, WGI
is a publicly traded company (WLDN). WGI, through its
divisions, provides professional technical and consulting
services that ensure the quality, value and security of our
nation's infrastructure, systems, facilities, and environment.
The firm has pursued two primary service objectives since its
inception-ensuring the success of its clients and enhancing
its surrounding communities.
A financially stable company, Willdan has approximately
1,800 employees working in more than a dozen states across
the U.S. Our employees include a number of nationally
recognized Subject Matter Experts for all areas re lated to the
broadest definition of connected communi ties-including a
team who will be committed to contributing their
expertise throughout the duration of the City of
Cupertino's Nexus Study for Below Market Rate
lnclusionary Housing and In-Lieu Fees engagement.
Willdan has solved economic, engineering and energy
Jeff McGarvey
Vice President/
Managing Principal
Michael Vasquez
Vice President/Director
Josephine Moses
Vice President/
Assistant Director
Rebekah Smith
Assistant Secretary/
Director of Operations
I ;•------------~---~
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challenges for local communities and delivered industry-leading solutions that have transformed government and
commerce. Today, we are leading our clients into a future accelerated by a change in resources, infrastructure, technology,
regul ations, and industry trends.
W W ILLDAN Nexus Study for Below Market Rate l nclusionary Housing and I n-Lieu Fees s
City of Cupertino, California
Willdan Financial Services
Established on June 24, 1988, Willdan Financial Services, is a national firm and is one of the largest public sector econom ic
and financial analysis consu lting firms in the United States. Since that time, we have helped over 800 public agencies
successfully address a broad range of infrastructure challenges.
Our team is focused on actively supporting our clients by ensuring they stay informed about the latest advancements in
our areas of expertise. We believe that by sharing this knowledge, we can empower our clients to make informed decisions
and achieve their objectives . Willdan assists local public agencies by providing the following services:
• User fee studies; • Development impact fee establishment and analysis;
• Cost allocation studies; • District Administration Services;
• Utility rate and cost of service studies;
• Real estate economic analysis;
• Property tax audits;
• Feasibility studies; • Tax increment finance district formation and amendment;
• Municipal Advisory; • Housing development and implementation strategies;
• Arbitrage and Continuing Disclosure Services; • Debt issuance support; and
• Economic development strategic plans; • Long-term financial plans and cash flow modeling.
Experience and Expertise
Willdan has been preparing impact fee nexus studies since the
passage of the Mitigation Fee Act. Our commitment to publ ic agencies
and public solutions has helped us develop the broad finance expertise
that will be utilized to support the City's Nexus Study. Wi lldan has
worked on virtually every aspect of municipal finance, including fiscal
and economic impact studies related to development and re
organization, the financ ing of infrastructure and services through
special district or supplemental taxes, and even working under
contract as a department head of an entire municipality. This
experience has provided W illdan team members with deep insight into
the sources of municipal revenue and the costs of services.
Managing Principal James A. Edison and his team have worked with
public agencies on many community devel opment projects, including
the full range of analysis related to feasib ility, economic and fiscal
impacts, infrastructu re finance, and negotiations with private
developers. Willdan is thoroughly familiar with both the Act and with
the technical and pol icy issues surround ing impact fees.
Unique Qualifications
Willdan is uniquely qualified to assist the City of Cupertino with the
In the past five years Wil!dan has
conducted over 125 Impact Fee Studies
~ ... -:_... 80 + , ~·fl u■--.. ,i --· 0
l.: ~ Mun icipalfGovernment Cl ient
Experience
across
proposed Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees. The following are specific
advantages that we will provide for the proposed engagement.
Project Dedication
Willdan has assembled a project team of subject matter experts within the Financial Consulting Services group, to conduct
the City of Cupertino engagement. This team has coordinated or participated in numerous public stakeholder and staff
workshops regarding fees and cost of service-based charges.
Community Investment
Much of our success in developing impactful programs and studies is due to our experiences in meeting with citizen /
stakehol der groups and elected officials. Our ability to explain technical information in a concise, understandable manner
is a fundamental reason for our high degree of success. Willdan staff takes the time to include and inform
the Community.
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees 6
City of Cupertino, Californ i a
Staff Qualifications and Experience
Project Team
Our management and supervision philosophy for the project team is very simple: staff every position in sufficient numbers
with experienced personnel to deliver a superior product and convey results to decision makers in meetings, on time and
on budget. With that philosophy in mind, we have selected experienced professionals for the City's engagement. We are
confident that our team possesses the depth of experience that will successfully fulfill the desired work performance.
James Edison, JD, MPP, MA
Managing Principal
Carlos Villarreal, MPP
Principal Consultant
Staff Continuity
Principal-in-Charge
Project Manager
• Ensure client satisfaction, flow of communication, and
management of the project
• Technica l gu idance
• Project oversight
• Qual ity assurance & control, and
• Meeting and presentation attendance
• Collect, interpret, and disseminate key data
• Day to day contact
• Production of key elements of the analyses
• Model development
• Report preparation, and
• Meeting and presentation attendance
Mr. Edison has been assigned to serve as the City's principal-in-charge; he has been selected for this role due to his
extensive experience, which includes the preparation and supervision of numerous fee studies, as well as his experience
presenting to governing bodies, stakeholders, and industry groups.
We do not anticipate staffing changes during the course of the project, however, should the situation arise, any change in
team members will be discussed and approved in concert with the City of Cupertino prior to the change being made.
The Financial Consulting Services group is composed of a team of over 30 professionals. Through continuous internal
training within the firm, as well as recent additions of qualified analysts, we are able to reassign analysts should it become
necessary; this will occur with no strain on the projected timeline. Wh ile each member of the project team currently has
work in progress with other clients, the workl oad is at a manageabl e level with sufficient capacity to meet the needs of the
City specific to the schedule and budget for this engagement.
Proven Professionals
The Team's quality is often as important as the consulting firm 's
reputation. Willdan is known for its personal, customized service.
Our team will work with the C ity's professional staff to provide the
long-term service, that is our prime goal.
Re su mes
The team presented within this proposal has
worked collectively on numerous projects, such
as the one requested by the City of Cupertino;
an established work practice between the team
members has been forged , this proven long
standing system has benefited our clients.
Resumes for Willdan's project team are presented on the following pages , wh ich includes ed ucation, certifications , and
relevant experience.
WWILLDAN Nexus Study for Below Market Rate l nclusionary Housing and In-Lieu Fees 7
City of Cupertino, California
£ducation
Juris Doctorate,
University of
California, Berkeley,
School of Law
Master of Public
Policy, Goldman
School of Public
Policy, University of
California, Berkeley
Bachelor of Arts,
magna cum laude,
Harvard University
Professional
Registrations
Member of State Bar,
California
Affiliations
Council of
Development Finance
Agencies
CFA Society of
San Francisco
Congress for the
New Urbanism
Urban Land Institute
Seaside Institute
International Economic
Development Council
28 Years' Experience
WWILLDA
James Edison, JD, MPP, MA
Principal-in-Charge
Mr. James Edison specializes in the nexus between public and private, with expertise in public-private
partnerships, and the benefits of economic development to municipalities and state, provincial,
regional , and national governments. He possesses deep expertise in land use economics, with a
specialty in finance and implementation , including fiscal impact and the public and private financing of
infrastructure and development projects, both in the U.S. and internationally. Mr. Edison's public
sector experience includes local and regional economic impact studies ; fiscal impact evaluations: new
government formation strategies : and the creation of impact fees, assessments , and special taxes to
fund infrastructure and public facilities. He has conducted numerous evaluations of the economic and
fiscal impact of specific plans and consulted on a wide variety of l and use planning topics related to
community revitalization and the economic and fiscal i mpacts of development.
As a former bond attorney, Mr. Edison understands the l egal underpinnings and technical
requirements of public financing instruments and has advised both publ ic and private clients on the
use of individual instruments, and the interaction between those instruments and the needs of
developers and project finance.
Re lated Experience
City of Morgan Hill, CA -Development Impact Fee Update: Mr. Edison was the principal-in-charge
of the update of the City's existing nexus study, which included general government, fire, police, parks
and recreation, l ibrary, and storm drain fee categories. The project scope included stakeholder
outreach. The City has once again engaged Willdan to update their impact fees.
City of Pacifica, CA -Park Fee Update: Mr. Edison served as the City's project manager to update
their park fee to include new costs and to impose fees for home expansion/remodels, in addition to
new devel opment
City of Alameda, CA -Comprehensive Impact Fee Update: Mr. Edison led the Willdan team
updating the impact fee programs of the City of Alameda and creating a separate impact fee program
for Alameda Point, the former Alameda Naval Air Station.
City of Santa Clara, CA -Parks Fee Update: Mr. Edison served as principal-in-charge of the City's
park impact fee update. This project included a demographic analysis and estimation of the cost of
acqu iring and improving public park l and.
County of Tulare, CA -Countywide Impact Fees: Mr. Edison served as project manager for a study
that involved the creation of an impact fee program for the County. The study includes a range of
facilities including public protection , library, and parks, as well as a transportation facilities impact fee,
with different fees calculated for two zones in the County.
City of Pismo Beach , CA -Development Impact Fee Update: Mr. Edison was the principal-in
charge of an update to the City's impact fee program. The program included the following facil ities:
police, fire protection, park and recreation improvements, water system improvements, wastewater,
traffic, and general government/administrative facilities. Prior to fee program adoption , a stakeholder
meeting was held to inform the public about the project, and to solicit feedback from the development
community.
City of Fremont, CA-Comprehensive Impact Fee Upd ate: Mr. Edison led the Willdan team in the
successful update of the impact fee programs for the City of Fremont. The effort included an update
of the City's transportation impact fee program and capital improvement program.
County of Riverside, CA -Comprehensive Impact Fee Update: Mr. Edison led the effort to
establish a comprehensive fee program for the County, including facilities fees for fire, police, parks,
criminal justice, libraries , and traffic. He prepared the technical and analytical documents necessary
to calculate the fee and establish the necessary nexus to collect it, as well as presented the fees during
public hearings to the County Board of Supervisors.
City of Indian Wells, CA -Development Impact Fee Study: Mr. Edison served as the principal-in
charge for the City Indian Wells' update to their development impact fees. The fee program was
comprised of a variety of fee categories including transportation , public facilities , recreation , park , and
storm drain.
Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees 8
City of Cupertino, California
Education
Master of Public
Policy, Goldman
School of Public
Policy, University of
California, Berkeley
Bachelor of Arts,
Geography, University
of California, Los
Angeles; Minor in
Public Policy and
Urban Planning
Areas of Expertise
Fiscal Impact Analyses
Development Impact
Fees
Public Facilities
Financing Plans
GIS Analysis
79 Years' Experience
#WILLDAN
Carlos Villarreal, MPP
Project Manager
Mr. Carl os Villarreal , a Financial Consulting Group Principal Consultant, is proposed to serve in the
role of project manager due to his experience documenting nexus findings for development impact
fees, preparing capital imp rovement plans , faci litating sta keholder involvement, and analyz ing the
economic impacts of fee programs. He has supported adoption of fee programs funding a variety of
facility types.
Related Experience
City of Santa Clara , CA -Parks Fee Update: As assistant project manager to Mr. Edison, Mr.
Villarreal collected the necessary data to update the City's park impact fee . This project included a
demographic ana lysis and estimation of the cost of acquiring and improving public park land.
City of Carpinteria, CA-Development Impact Fee Update: Mr. Villarreal served in the rol e of lead
analyst to update the city's impact fees, which included the following facilities: highways and bridges,
streets and thoroughfares, traffic control , parking, storm drain, general government, aquatic, park and
recreation, and open space. The City has engaged Willdan again to update their im pact fees and Mr.
Villarreal is serving in the role of project manager.
City of Long Beach, CA -Park Impact Fee Update: Willdan assisted with an update to the City's
existing park impact fees , with Mr. Villarreal serving in the role of project manager. The project included
updating demographic data and facility planning to properly update park facility standards. He used
this information to then calculate impact fees for single fami ly and multi-fam ily residential dwelling units
and prepare a nexus study documenting the revised fees and the required legal findings under the
Mitigation Fee Act.
City of Orov ille -Impact Fee Study Update: Mr. Villarreal served as project manager for a study
updating the City's development impact fee program, including parks, l aw enforcement, general
government, fire suppression, and traffic facilit ies. The fee program was adopted by the City Council
in 2015. The City engaged Willdan again to update the 2015 study , and Mr. Villarreal served in the
role of project manager.
City of Pismo Beach, CA -Developme nt Impact Fee Update: Mr. Villarreal served in the ro le of
project manager for the City's impact fee project. The program included: police, fire protection, park
and recreation improvements, water system improvements, wastewater, traffic, and general
governme nt/administrative faci l ities. Prior to fee program adoption, a stakeholder meeting was held to
inform the public about the project, and to solicit feedback from the development community.
County of Stanislaus, CA -Impact Fee Study Update: Mr. Villarreal served in the ro le of project
manager for a study updating the County's existing impact fee program. The program includes a range
of facil ities, li ke public protection, l ibrary, and parks. The study al so included a transportation facilit ies
impact fee, with different fees calcul ated for two zones in the County. Considerable stakeholder
outreach was an integral component of th is project.
County of San Benito, CA -Comprehensive Impact Fee Study : As project manager, Mr. Villarreal
assisted the County of San Benito with the preparation of an updated and expanded impact fee
program. The fee programs included: Capital Improvements Impact Fee ; Road Equipment Impact Fee;
Fire Mitigation Impact Fee; and Park and Recreation Impact Fee.
City of Morgan Hill, CA -Dev elopment Impact Fee Update: Mr. Villarreal served as project
manager for a study to update the City's existing nexus study, including general government, fi re ,
police , parks and recreation , l ibrary, and storm drain fee categories. The project scope included
stakeholder outreach. The City has once again engaged Willdan , and Mr. Villarreal served as the
project manager.
City of McFarland, CA -Development Impact Fee Study Update: Mr. Villarreal served as project
manager updating the City's development impact fee program. The study comprehensively updated
the City's fee program, incorporating new facility master planning and infrastructure costs necessary
to facilitate expected development in the City through 2040. The study included the following facility
fee categories; general government, law enforcement, park and recreation , fire protection, water,
sewer, storm drain , and traffic. The fees were adopted by the City Council in 2020.
Nexus Study for Below Market Rate lnclusionary Housing and I n-Lieu Fees 9
City of Cupertino, California
Similar Projects
References
Provided below are cl ient references for projects completed by Willdan and the project team members proposed herein ,
which demonstrates our ab ility to provide the requested services. We are proud of our reputation for customer service and
encourage you to contact our past clients regarding our commitment to excellence. Willdan has served as the prime of all
of these engagements.
City of East Palo Alto, CA
Development Impact Fee Nexus Study and F inancial Feasibility Analysis
Through competitive bid Willdan was retained 2023 to conduct a financial feasibil ity analysis and a comprehensive
update to the City's impact fees. The following fees were included in the study: Water Capacity, Parks and Trails, Public
Facilities, Transportation Infrastructure , Storm Drainage.
Willdan developed a technically defensible fee justification based on the reasonable relationship and deferential review
standards; provided a schedule of maximum-justified fees by land use category; engaged stakeholders to facilitate public
support for the impact fee; and provided comprehensive documentation of all assumptions , methodologies, and results,
including findings required by the Mitigation Fee Act.
Client Contact: Mr. Hanson Hom, FAICP, Deputy Manager, Special Projects
1960 Tate Street, East Pal o Alto, CA 94303
Tel#: (650) 519-5121 I Email: hhom@cityofepa.org
City of Indian Wells, CA
Development Impact Fee N exus Study
Willdan was retained to perform a comprehensive update to the City's impact fee program in 2022. The fee program
was comprised of a variety of fee categories incl uding Transportation , Public Facilities , Recreation, Park and Storm
Drain. The analysis also included a development impact fee comparison of six other neighboring municipalities within
the Coachella Valley.
Client Contact: Mr. Kevin McCarthy, Finance Director
44950 Eldorado Drive, Indian Wells, CA 92210
Tel#: (760) 346-2489 I Email: kmccarthv@indianwells.com
City of Santa Clara, CA
Parks & Recreation Development Impact Fee Study
Willdan was contracted to update the City's existing Park Impact Fee. The City faced a unique challenge as their park
fee dated back many years and was not al igned with the City's newly adopted General Plan. Willdan util ized the
information specific to parks contained within the City's current Capital Improvement Plan , as well as demographic
information within the City's General Plan. Willdan prepared a nexus study establishing the fee that could be charged to
new development, which was adopted by the City Council , and is currently in effect.
Willdan was reta ined by the C ity in August of 20 18 to prepare a nexus study to update the I n-lieu Parkland Dedication
Fee under the Quimby Act, and the Park and Recreation Facilities Fee under the Mitigation Fee Act.
Client Contact:
W W ILLDAN
Mr. Jim Teixeira , Director of Parks and Recreation
1500 Warburton Avenue , Santa Clara , CA 95050
Tel#: (408) 615-2260 I Ema il : jteixeira@santaclaraca.gov
Nexus Study for Below Market Rate lnclusionary Housing and In -Lieu Fees 10
City of Cupertino, California
Recent Stud ies
The following table lists Willdan's impact fee clientele that have utilized our services in the past ten years.
City of Alameda , CA
City of Antioch, CA
City of Arcadia, CA
City of Artesia, CA
City of Bakersfield , CA
City of Banning, CA
City of Bell Gardens, CA
C ity of Bellflower, CA
City of Brea, CA
City of Calexico, CA
City of Calimesa, CA
City of Carpinteria, CA
City of Chino Hills, CA
City of Clovis , CA
City of Coachel la, CA
City of Commerce, CA
City of Compton, CA
City of Corona, CA
City of Covina, CA
City of Cudahy, CA
City of Cupertino, CA
City of Dublin, CA
City of East Palo Alto, CA
City of El Segundo, CA
City of Emeryville, CA
City of Fillmore, CA
City of Fountain Valley, CA
City of Fremont, CA
City of Garden Grove, CA
C ity of Gilroy, CA
City of Gonzales, CA
City of Goose Creek, SC
City of Guadalupe, CA
City of Greenfield , CA
City of Grover Beach, CA
City of Hawthorne, CA
City of Healdsburg , CA
City of Hercules, CA
City of Hollister, CA
City of Parkland , FL
City of Petaluma , CA
City of Pismo Beach, CA
City of Pittsburg, CA
City of Pleasant Hill , CA
City of Pomona. CA
City of Rancho Mirage, CA
City of Redwood City, CA
City of Rialto, CA
City of Richmond, CA
City of Rio Rancho, NM
City of Riverbank, CA
City of Rolling Hills Estates, CA
City of Rosemead , CA
City of San Carlos, CA
City of San Fernando, CA
City of San Jacinto, CA
City of San Marcos, CA
City of San Ramon, CA
City of Santa Clara, CA
City of Sebastopol, CA
City of Sel ma, CA
City of Sierra Madre, CA
City of Soledad, CA
City of South Gate, CA
City of South San Francisco, CA
City of St. Helena, CA
City ofTehachapi, CA
City of Thousand Oaks, CA
City of Tracy, CA
City of Upland, CA
City of Visalia, CA
City of Wasco, CA
Coachella Valley Association of Governments , CA
Contra Costa Fire Protection District, CA
County of Clay, FL
County of Kern, CA
County of Kings, CA
County of Los Angeles , CA
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees 11
City of Cupertino, California
C ity of Huntington Beach, CA
City of Huntington Park, CA
City of Indian Wells, CA
City of Irwi ndale, CA
City of Kingsburg, CA
City of La Mesa, CA
City of La Verne, CA
City of Las Cruces, NM
City of Lake Elsinore, CA
City of Lake Forest, CA
City of Lancaster, CA
C ity of Lawndale, CA
City of Livermore , CA
City of Long Beach, CA
City of McFarland, CA
City of Madera, CA
City of Manteca, CA
City of Men ifee , CA
City of Moreno Valley, CA
City of Morgan Hill, CA
City of Cupertino, CA
City of Murrieta, CA
City of Newport Beach , CA
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W W I LLDAN Nexus St u dy for Bel ow Ma r ket Rate l nclusio nary Housi ng and I n-Lie u Fees 12
City of Cupertino, California
Project Understanding and Approach
This section outlines Willdan Financial Services' ("Willdan") understanding of the City of Cupertino's ("City") desire to
conduct a Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees, as well as identify the project
objectives and discusses the background regarding public facil it ies financing in Ca lifornia. Also outlined is an overview of
our impact fee project approach.
Project Understanding
As part of the larger financial planning effort for the C ity's future development, the City seeks to understand what the
financial impacts of foreseeable future development will have on the City's public services and infrastructure, and to identify
potential gaps in funding for those necessary improvements. The City desires to update its current impact fees to ensure
a fair and reasonab le fee structure, while meeting the requirements of the California Mitigation Fee Act (California
Government Code 66000 et seq), including the new requirements enacted by Assembly Bill (AB) 602. The resulting fees
will fund new development's share of planned facilities , while not overburdening development with unnecessary costs. In
response to these objectives, the City has issued an RFP to prepare a Development Impact Study to update existing fees.
Project Objectives and Approach
The objective of this project is to update development impact fees pursuant to State law, and to assist the City in
understanding additional infrastructure needs necessitated by future development. To accomplish this objective, this study
will:
• Develop a l ist of impact fee categories that will meet the City's needs;
• Develop a technically defensible fee justification, based on the reasonable relationship and deferential review
standards;
• Review and facility standards, capital facilities plans and costs, and development and growth assumptions and
facilities master plans);
• Identify potential additional fees to address unmet future capital facilities needs;
• Provide a schedule of maximum-justified fees by land use category; and
• Provide comprehensive documentation of assumptions, methodologies, and results , including findings required by
the Mitigation Fee Act.
Public Facilities Financing in California
The changing fiscal landscape in Cal ifornia during the past 40 years has steadily undercut the financial capacity of local
governments to fund infrastructure. Four dominant trends stand out:
1. The passage of a string of tax limitation measures starting with Proposition 13 in 1978 and continuing through the
passage of Proposition 218 in 1996;
2. Declining popular support for bond measures to finance infrastructure for the next generation of residents and
businesses ;
3. Steep reduct ions in Federal and State assistance; and
4. Permanent shifting by the State of l ocal tax resources to the State General Fund to offset deficit spending brought
on by recessions.
Faced with these trends, many cities and counties have had to adopt a policy of "growth pays its own way." This policy
shifts the burden of funding infrastructure expansion from existing rate and taxpayers onto new development. This fund ing
shift has been accomplished primarily through the imposition of assessments, special taxes, and development impact fees ,
also known as public facilities fees.
Assessments and special taxes require approval of property owners or registered voters and are appropriate when the
funded facilities are directly related to the developing property.
Development impact fees, on the other hand , are an appropriate funding source for facil i ties that benefit development
jurisdiction-wide. Development fees need only a majority vote of the legislative body for adoption.
Approach and Methodology
Willdan's methodology for cal culating public facilities fees is both simple and flexible. Simpl icity is important so that the
development community and the public can easily understand the justification for the fee program. At the same time, we
use our expertise to reasonably ensure that the program is technically defensible.
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees 13
City of Cupertino, California
Flexibility is important, so we can tailor our approach to the available data, and the agency's policy objectives. Our
understanding of the technical standards establ ished by statutes and case law suggests that a range of approaches are
technically defensible.
Consequently, we can address policy objectives related to the fee program, such as economic development and affordable
housing. Flexibil ity also enables us to avoid excessive engineering costs associated with detailed facil ity planning. We
calculate the maximum justifiable impact fee and provide flexibility for t he agency to adopt fees up to that amount.
Development impact fees are cal cu lated to fund the cost of faci l ities required to accommodate growth. The four steps
followed in an impact fee study include:
• Estimate ex isting development and futu re growth: Identify a base year for existing development and a growth
forecast that reflects increased demand for publ ic facil ities;
• Identify facility standards: Determine the facil ity standards used to plan for new and expanded faci lities;
• Determine fac ilities required to s erve new development and their costs : Estimate the total amount and cost
of pl anned facilit ies, and identify the share required to accommodate new development; and
• Calculate fee schedule: Allocate facilities costs per unit of new development to calcul ate the public fac ilities fee
schedul e.
We discuss key aspects of our approach to each of these steps in the subsections that follow.
Growth Projections
I n most cases, we recommend use of long-range market-based projections of new devel opment. By "long-range" we
suggest 20 to 30 years to: capture the total demand often associated with major publ ic facility investments; and support
analysis of debt financing, if needed. In contrast to bui ld out projections, market-based projections provide a more realist ic
estimate of development across all l and uses. Build out projections typically overestimate commercial and industrial
development because of the oversupply of these land uses relative to residential development.
Facility Standards
The key publ ic policy issue in development impact fee studies is the identification of faci l ity standards (second bullet above).
Facility standards document a reasonable relationship between new development and the need for new facilities.
Standards ensure that new development does not fund deficiencies associated with existing development.
Our approach recognizes three separate components of facility standards:
1. Demand sta ndards determine the amount of facil ities required to accommodate growth . Examples include park
acres per thousand residents, square feet of l ibrary space per capita, or gall ons of water per day. Demand standards
may also reflect a level of service such as the vehicles-to-capacity (V/C) rat io used i n traffic planning;
2. Design standards determine how a facility should be designed to meet expected demand, for exampl e park
improvement requi rements and technology infrastructure for office space. Design standards are typically not
expli citly eval uated as part of an i mpact fee analysis but can have a significant impact on the cost of facilities. Our
approach incorporates current fac il ity design standards into the fee program to reflect the increasing construction
cost of public facilities; and
3. Cost standards are an alternate method for determining the amount of faci lities required to accommodate growth
based on facility costs per unit of demand. Cost standards are useful when demand standards were not expl icitly
developed for the facility planning process. Cost standards also enable different types of facilities to be analyzed
based on a single measure (cost or value), useful when disparate facilities are funded by a single fee program.
Examples include facility costs per capita, per vehicle trip , or cost per gallon of water per day.
Identifying New Development Facility Needs and Costs
We can take several different approaches to identify facility needs and costs to serve new development. Typically, this is
a two-step process: 1) identify total facility needs; and 2) allocate to new development its fair share of those needs. Total
facility needs are often identified through a master facility planning process that typically takes place concurrent with or
prior to conducting the fee study. Engineered facility plans are particularly important in the areas of traffic, water, sewer,
and storm drain due to the specialized technical analysis required to identify facility needs.
There are three common methods for determining new development's fair share of planned facilities costs: 1) the existing
inventory method ; 2) the planned faci lities method; and 3) the system plan method. Often the method selected depends
on the degree to which the community has engaged in comprehensive fac ility master planning to identify facility needs.
WWILLDAN Nexus Study for Below Market Rate lndusionary Housing and In -Lieu Fees 14
City of Cupertino, California
The formula used by each approach and the advantages and disadvantages of each method is summarized as follows:
Existing Inventory Method
The existing inventory method allocates costs based on the ratio of existing facilities to demand from existing development
as follows:
Current Value of Existing Facilities
Existing Development Demand = $/unit of demand
Under this method new development funds the expansion of facil ities at the same standard currently serving existing
development. By definition, the existing inventory method results in no faci lity deficiencies attributabl e to existing
development. This method is often used when a long-range plan for new facil ities is not available. Only the initial facilities
to be funded with fees are identified in the fee study. Future faci l ities to serve growth are identified through an annual
Capital Improvement Plan (CIP) and budget process, possibly after completion of a new facility master plan.
Planned Facilities Method
The planned facilities method allocates costs based on the ratio of planned facil ity costs to demand from new devel opment
as follows:
Cost of Planned Facil ities
New Development Demand
= $/unit of demand
This method is appropriate when specific planned faci lities can be identified that only benefit new development. Examples
include street improvements to avoid deficient levels of service or a sewer trunk line extension to a previously undeveloped
area. This method is appropriate when planned faci l ities would not serve existing development. Under this method new
devel opment funds the expansion of faci l ities at the standards used for the master faci l ity plan.
System Plan Method
This method calculates the fee based on the ratio of the value of existing facilities plus the cost of planned facilities divided
by demand from existing plus new development:
Value of Existing Facilities + Cost of Planned Facilities
Existing + New Development Demand = $/unit of demand
This method is useful when planned facilities need to be analyzed as part of a system that benefits both existing and new
development. It is difficult, for example, to allocate a new fire station solely to new development when that station will
operate as part of an integrated system of fire stations that work together to achieve the desired level of service. Police
substations, civic centers, and regiona l parks are examples of similar faci l ities.
The system plan method ensures that new development does not pay for existing deficiencies. Often, faci l ity standards
based on policies such as those found in General Plans are higher than existing facility standards. This method enables
the calculation of the existing deficiency required to bring existing development up to the policy-based standard. The local
agency must secure non-fee funding for that portion of planned faci l ities, required to correct the deficiency, to ensure that
new development receives the level of service funded by the impact fee.
Calculating the Fee Schedule
At its simplest, the fee schedule uses the cost per unit of demand discussed in the last subsection to generate the fee
schedule. This un it cost is multiplied by the demand associated with a new development project to calculate the fee for
that project. The fee schedu le uses different demand measures by land use category to provide a reasonable relationship
between the type of development and the amount of the fee. We are familiar with a wide range of methods for identifying
appropriate land use categories and demand measures depending on the study.
Related Approach Issues
Funding and Financing Strategies
In our experience, one of the most common problems w ith impact fee programs and with many CIPs is that the program
or plan is not financ ially constrained to anticipated revenues. The result is a "wish list" of projects that generate community
expectations that often cannot be fulfilled. Our approach is to integrate the impact fee program into the local agency's
existing CIPs while encouraging those plans to be financially constrained to available resources. We clearly state the cost
of correcting existing deficiencies, if any, to document the relationship between the fee program and the need for additional
non-fee funding.
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees 15
City of Cupertino, California
We can also address one of the most significant drawbacks of an impact fee program -the inability to support conventional
public debt financing, so projects can be built before all fee revenues have been received. In collaboration with financial
advisors and underwriters, we have developed specific underwriting criteria so that fees can be used to pay back borrowing
if another source of credit exists. Typically, this approach involves the use of Certificates of Participation or revenue bonds
that are calibrated so that they can be fully repaid using impact fee revenues.
Economic Development Concerns
The development community often is concerned that fees and other exactions will become too high for development to be
financially feasible under current market conditions. Local agencies have several strategies to address this concern,
incl uding:
• Conducting an analysis of the total burden placed on development, by exactions, to see if feasibility may be
compromised by the proposed fees;
• Gathering similar data on the total fee burden imposed by neighboring or competing jurisdictions;
• Developing a plan for phasing in the fees over several years to enable the real estate market to adjust;
• Providing options for developers to finance impact fees through assessments and other types of financing districts;
and
• Imposing less than the maximum justified fee.
If less than the maximum justified fee is imposed, we will work with staff to identify alternative revenues sources for the
CIP. The CIP should remain financially feasible to maintain realistic expectations among developers, policymakers, and
the public.
Stakeholder Participation
Stakeholder participation throughout the study supports a successful adoption process. Our approach is to create
consensus first, around the need for facilities based on agreed upon facility standards. Second, we seek consensus around
a feasible funding strategy for these needs, leading to an appropriate role for impact fees.
Gaining consensus among various groups requires a balanced discussion of both economic development and community
service objectives. Often, our approach includes formation of an advisory committee to promote outreach to and input from
the development community and other stakeholders. We have extensive experience facilitating meetings to explain the
program and gain input.
Program Implementation
Fee programs require a certain level of administrative support for successful implementation. Our final report will include
recommendations for appropriate procedures, such as:
• Regularly updating development forecasts;
• Regularly updating fees for capital project cost inflation;
• Regularly updating capital facility needs based on changing demands;
• Developing procedures for developer credits and reimbursements; and
• Including an administrative charge in the fee program.
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees 16
City of Cupertino, California
Work Plan
Willdan will work with the City to update its impact fees consistent with the Mitigation Fee Act and other relevant laws. We
want to ensure that our scopes of services are responsive to the City's needs and specific local circumstances. We will
work with the City to revise our proposed scopes based on input prior to approval of a contract, and as needed during the
course of the studies.
Task 1: Identify and Resolve Policy Issu es
Objective: Define project goals and objectives; outline project and management approach; identify roles and
responsibilities; and confirm scope and schedule.
Description: Review agency documents related to affordable housing, housing supply, and commercial development,
including the City's prog ress toward its RHNA requirements. Bring policy issues to City staff's attention,
as appropriate , during the project and seek guidance prior to proceed ing. Potential policy issues include.
Meeting: One meeting to initiate the project, discuss data needs, and begin d iscussion of applicable policy issues.
Deliverables: Information requests, revised project scope and schedule (if needed), brief summary of policy decisions
(if needed), and description of any legal/language issues identified in review of City documents and
policies ..
Task 2: Commercial Linkage Fee Analysis
Objective: Prepare recommended amounts and classifications specific to a housing linkage fee, a fee charged to
non-residential development to offset impacts to affordable housing in the City.
Description: Using data from the California Employment Development Department (EDD) and US Census LEHO data,
identify employment levels and types by major sector within Cupertino. Prepare wage estimates on a
sector-by-sector basis using Bureau of Labor Statistics (BLS). Sectors will be summarized by occupational
classifications using Standard Occupation Codes (SOC).
Using employment densities for each job type, estimate the number of workers that would be
accommodated on a per square foot basis, the percentage of those workers who would form households,
and the number of new households that would be formed by income category.
Based on the housing market data in collected as a part of the affordable housing impact fee analyses
(Task 3), and the labor market analys is prepared in this task, develop proforma and determine affordab ility
gap per unit for each income level by industry and occupation . This will be used to determine the per-unit
affordability gap by number of households in each job type, by income level to determine linkage fee on a
per square foot basis by category of nonresidential development.
Deliverables: Recommended linkage fee schedule.
Task 3 Affordable Housing Fee Analysis
Objective: Conduct an analysis related to the affordable housing in-lieu fee, charged to residential development.
Description: The goal fo r the affordable housing in-lieu fees collected from market rate development is to help offset
the cost of affordable housing needed as a result of new residentia l development in the City.
Willdan will prepare a calculation of the maximum justifiable affordable housing fee for residential
development in the City. The calculation will be based on the estimated income of new households and
the employment generated by expenditures by new residents in the City.
Combined with labor market and wage data Willdan will estimate the number of new employees in the City
generated by new housing and the degree to which they will require a subsidy to afford housing in the
City. Willdan will also evaluate the current City incentives or structures for affordable housing provision,
which will include the consideration of incentives or a fee structure that incentivizes the inclus ion of
affordable housing in a residential or mixed-use development.
The final report (Task 4) will contain an analysis specific to affordable housing fees , current income and
housing pricing, and the cost of ownership to establish the effect of the proposed fees on housing
affordability.
Deliverables: Analysis will be documented in the Final Report.
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees 17
City of Cupertino, California
Task 4: Prepare Economic Feasibility Analysis
Objective: Evaluate the financial feasibility of the City's existing and potential BMR requirements and in-lieu fees.
Description: Prepare proforma analyses for up to six representative rental and ownership development prototypes, to
be identified in consultation with City staff. The analysis will consider development costs, revenues,
financing assumptions, City fees, BMR obligations, and expected developer returns.
Evaluate the financial impact of the City's existing requirements and selected alternatives, including
changes to inclusionary percentages, affordability levels, and fee-out options. Summarize the findings and
provide recommendations for economically feasible program requ irements.
Deliverables: Administrative draft, public draft, and final economic feasibi lity analysis ..
Task 5: Conduct Fee and Program Comparison
Objective: Compare the City's BMR requirements and in-lieu fees with those of comparable California jurisdictions.
Description: Review inclusionary housing programs from selected Santa Clara County and Bay Area jurisdictions. The
comparison will consider inclusionary percentages, affordability levels, fee amounts , calculation methods,
exemptions, alternative compliance options, and annual adjustment provisions.
Summarize the results in a comparison table and identify relevant practices for the City's consideration.
Deliverables: Fee and program comparison table and summary of findings incorporated into the study report.
Task 6 Calcu late Fees and Prepare Report
Objective: Provide technically defensible fee report that comprehensively documents project assumptions ,
methodologies, and results.
Description: Generate fee schedule to apportion facility costs to individual development projects.
Prepare draft report tables for City staff to review that document each step of the analysis , including
schedule of maximum justified fees by facility type land use category.
Following one round of comments from City staff on the quantitative analysis and fee schedules, prepare
administrative draft report. Following one round of comments on the administrative draft, prepare public
draft for presentation to interested parties, the public and elected officials.
Prepare final report, if necessary, based on one round of comments received on the public draft report. If
requested , post report on our website for public access.
Deliverabl es: Draft report tables, administrative draft report, public draft report, final report (if needed), and slide
presentation (if needed). Fee model and feasibility model will be provided after final approval.
Task 7 Meetings
Objective: The project manager or other necessary Willdan staff will attend project meetings. A project team will
attend up to three (3) meetings: one meeting to review the initial project results; one City Council meeting
to present the public draft report for review and comment; and one public hearing to present the report for
adoption.
Optional: Optional stakeholder and Council meetings may be requested by the City.
City Staff Support
To complete our tasks , we will need the cooperation of City staff. We suggest that the City of Cupertino assign a key
individual to represent the City as the project manager who can function as our primary contact. We anticipate that the
City's project manager will: 1) Coordinate responses to requests for information ; 2) Coordinate review of work products;
and 3) Help resolve policy issues.
Willdan will endeavor to minimize the impact on City staff in the completion of this project. We will ask for responses to
initial information requests in a timely manner. If there are delays on the part of the City, we will contact the City's project
manager to steer the project back on track. We will keep the City's project manager informed of data or feedback we need
to keep the project on schedule.
Project Disclaimer
Willdan is a registered municipal advisory firm with the U.S. Securities and Exchange Commission ("SEC"), as such the
City of Cupertino represents, acknowledges, and agrees that Willdan is not acting as a "municipal advisor" (as defined by
the SEC), to the City, in any capacity as it relates to the project proposed in this Nexus Study RFP.
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and I n-Lieu Fees 18
City of Cupertino, California
(i.) The City uses, or may use, the services of one or more municipal advisors registered with the SEC to advise it in
connection with municipal financial products and the issuance of municipal securities;
(ii) The City is not looking to Willdan to provide , and the City shall not otherwise request or require Willdan to provide any
advice or recommendations with respect to municipal financial products or the issuance of municipal securities
(including any advice or recommendations with respect to the structure, timing, terms, and other similar matters
concerning such financial products or issues);
(iii) The provisions of this proposal and the services to be provided hereunder as outlined in the scope of services are not
intended (and shall not be construed) to constitute or include any municipal advisory services within the meaning of
Section 158 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and
regulations adopted thereunder;
(iv) For the avoidance of doubt and without limiting the foregoing, in connection with any revenue projections, cash-flow
analyses, feasibility studies and/or other analyses Willdan may provide the City with respect to financia l , economic o r
other matters relating to a prospective, new or existing issuance of municipal securities of the City, (A) any such
projections, studies and analyses shall be based upon assumptions, opinions or views (including, without limitation,
any assumptions related to revenue growth) established by the City, in conjunction with such of its municipal, financial ,
legal and other advisers as it deems appropriate; and (8) under no circumstances shall Willdan be asked to provide,
nor shall it provide, any advice or recommendations or subjective assumptions, opinions or views with respect to the
actual or proposed structure, terms, timing, pricing or other similar matters with respect to any municipal financial
products or municipal securities issuances, including any revisions or amendments thereto; and
(v) Notwithstanding all of the foregoing, the City recognizes that interpretive guidance regarding municipal advisory
activities is currently quite limited and is likely to evolve and develop during the term of the potential engagement and,
to that end, the City will work with Willdan throughout the term of the potential Agreement to ensure that the Agreement
and the services to be provided by Willdan hereunder, is interpreted by the parties, and if necessary amended, in a
manner intended to ensure that the City is not asking Willdan to provide, and Willdan is not in fact providing or required
to provide , any municipal advisory services.
WWILLDAN Nexus Study for Bel ow Market Rate lnclusionary Housing and In-Lieu Fees 19
Exhibit B & C Schedule of Delivery/Cost Proposal
City of Cupertino, CA
Technical Proposal
Nexus Study for Below Market
Rate Inclusionary Housing and In
Lieu Fee
City of Cupertino, California
Cost Proposal
Housing and In-Lieu Fees
Based on the corresponding work plan identified within the scope of services, we propose a fixed fee of $61,920 to conduct
the Nexus Study.
City of Cupertino
Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees
F.ee QroRosal
J. Edison c . Villarreal
Principal-in-Project
Charge Manager Total
$ 300 $ 270 Hours Cost
Scope of Services
Task 1: Identify and Resolve Policy Issues 22.0 20.0 42.0 $ 12,000
Task 2: Commercial Linkage Fee Analysis 24.0 22.0 46.0 13,140
Task 3: Affordable Housing Fee Analysis 16.0 18.0 34.0 9 ,660
Task 4: Prepare Economic Feasibility Analysis 18.0 20.0 38.0 10,800
Task 5: Conduct Fee and Program Compari son 8.0 14 .0 22.0 6 ,180
Task 6: Calculate Fees and Prepare Report 6.0 12.0 18.0 5,040
Task 7: Meetings 8.0 10 .0 18.0 5 ,100
Total -Affordable Housing In Lieu Fees 102.0 116.0 218.0 $ 61,920
Notes
Please note the following:
• The fee denoted above includes attendance at up to three in-person meetings with City staff, stakehold ers, and City
Council.
Attendance at more than three meetings wi ll be billed at our current hourly rates, provided below, and actual expenses.
• Comprehensive written responses to resolve conflicts or preparation of more than one set of major revisions to the
draft report , will be classified as Additional Services, and may requ ire additional billing at hourly rates stated in the
hourly rate schedule listed below. These additional fees shall only take effect once the fixed fee stated above has been
exceeded.
• Our fixed fee includes all direct expenses associated with the project.
• We will invoice the City monthly based on percentage of project compl eted.
• City shall reimburse Willdan for any costs Willdan incurs, including without limitation, copying costs , digitizing costs ,
travel expenses , employee time and attorneys' fees, to respond to the legal process of any agency re lating to City or
relating to the project. Reimbursement shall be at Willdan 's rates in effect at the time of such response.
• Optional/Additional Services beyond the listed Scope of Services may be authorized by the City and will be billed at
our then-current hourly overhead consulting rates.
Hourly Rates
Provided below is Willdan's hourly rate table identi fy ing current hourly rates for additional or optional services.
Hourly Rate Schedule
Position iTeam Memoer Hourly Rate Position ifeam Memcer Hourly Rate
Vice President / Director $310 Managing Principal James Edison $300
Principal Consultant Carlos Villarreal $270 Senior Project Manager $250
Project Manager $210 Senior Project Analyst $150
Senior Analyst $135 Analyst II $120
Analyst I $110
WWILLDAN Nexus Study for Below Market Rate lnclusiona ry Housing and I n-Lieu Fees 20
City of Cupertino, California
Contract Acceptance
Willdan has reviewed the City's sample agreement and has no changes to the document as presented in the RFP.
Project Schedule
Willdan anticipates time is of the essence for the City to begin this engagement. The proposed schedule can only be met
with the cooperation of City staff. Delays in responding to our requests for data and review will result in corresponding
delays to the project schedule. If that is the case, we will notify the City immediately of the possible impact on the schedule.
Scope of Services
Task 1: Identify and Resolve Polley Issues
Task 2: Cormiercial Linkage Fee Analysis
Task 3: Aff0<dable Housing Fee Anatysis
Task 4: Calculate Fees and Prepare Report
Task 5: Meeti s
Deliverables:
.......,
X1: Information Request, Agenda. Rellised Schedule. Summary of Policy Decisions
X2: Linkage Fee Schedule
Meetings:
M -City Staff Meetings
C -City Counc~ Meeting (Study Session/Public Hearing)
X3 • -------••••·--x4
X 3: Affordable Housing Fee Analysis
X4: Adrrinistrati'-'!/Public Draft Report, Final Report, Presentation
WWILLDAN Nexus Study for Below Market Rate lnclusionary Housing and In-Lieu Fees 21
31
J 2
EXHIBITD
Insurance Requirements
Professional Consultant Contracts
Consultant shall procure prior to commencement of Services and maintain for the duration of the contract, at its
own cost and expense, the following insurance policies and coverage with companies doing business in California
and acceptable to City.
INSURANCE POLICIES AND MINIMUMS REQUIRED
l. Commercial General Liability (CGL) with coverage at least as broad as Insurance Services Office
(ISO) Form CG 00 0 l , with limits no less than $2,000,000 per occurrence and $2,000,000 general
aggregate. The policy shall include a per project or per location general aggregate endorsement as
broad as CG 25 03 or CG 24 04. If a per project/location endorsement is not available, the limit of
the general aggregate shall be doubled.
a It shall be a requirement that any availa ble insurance proceeds broader than or in excess of the
specified minimum insurance coverage requirements and/or limits shall be made available to the
Additional Insured and shall be (i) the minimum coverage/limits specified in this agreement; or (ii) the
broader coverage and maximum limits of coverage of any insurance policy, whichever is greater.
h Additional Insured coverage under Consultant's policy shall allow and be endorsed "primary and
non-contributory," will not seek contribution from City's insurance/se lf-insurance, and shall be at least
as broad as the most recent edition of ISO Form CG 20 0 l.
c The limits of insurance required may be satisfied by a combination o f primary and umbrella or excess
liability insurance, provided each policy follows form of the underlying policy and complies with the
requirements set forth in this Contract. Any umbrella or excess insurance shall contain or be endorsed to
contain a provision that such coverage shall also apply on a primary basis for the benefit of City. The
City's own insurance or self-insurance shall not be called up on.
2 Automobile Liability: Coverage shall be provided using ISO CA 00 01 covering any auto (including
owned, hired, and non-owned autos) with limits no less than $1,000,000 each accident for bodily injury
and property damage.
:J Not required. Consultant shall be fully remote and not use automobiles to provide the service.
In the event Consultant uses an automobile or automobiles in the operation of its business to provide
services under this Agreement, the Consultant shall,prior to such use, provide the City with evidence
of Business Automobile Liability insurance coverage in the amount required under this Section 2 for
owned, non-owned and hired autos (any auto-Symbol 1), or if Consultant does not own autos (hired
autos-Symbol 8 and non-owned autos-Symbol 9). Evidence shall be provided with a Certificate of
Insurance, along with an additional insured endorsement in favor of the City, primary and non
contributory coverage and endorsement, and waiver of subrogation coverage and endorsement under
the policy prior to the use of any automobile.
:J Consultant has provided written confirmation that it does not own any autos. Consultant shall provide
coverage for hired autos-Symbol 8 and non-owned autos-Symbol 9. Primary and Non-Contributo1y
coverage and Waiver of Subrogation coverage is waived under the Automobi le Liability hired and
non-owned only coverage. In the event Consultant uses an owned automobile or automobiles in the
operation of its business to provide services under this Agreement, the Consultant shall, prior to such
use, provide the City with evidence of Business Automobile Liability insurance coverage in the
amount required under this Section 2 for owned. non-owned and hired autos (any auto-Symbol I).
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=:J In lieu of Business Automobile Liability , Consultant shall maintain throughout the tenn of this
Agreement and provide the City with evidence (including the policy Declarations Page) of personal
automobile insurance coverage in accordance with the laws of the State of California. As available
under the policy, evidence shall be provided with the Certificate oflnsurance, along with an additional
insured endorsement in favor of the City, primary and non-contributory coverage and endorsement,
and waiver of subrogation coverage and endorsement. City approval of coverage is required prior to
commencement of services.
3. Workers' Compensation: As required by the State of California, with Statutory Limits and Employer's
Liabi lity Insurance of no less than $1,000,000 each accident/ disease.
D Not required. Consultant has provided written verification of no employees.
4. Professional Liability for professional acts, errors and omissions, if applicable and as appropriate to
Consultant's profession, with limits no less than $2,000,000 per occurrence or claim, $2,000,000
aggregate. If written on a claims-made basis form:
a The Retroactive D ate must be shown and must be before the Effective Date of the Contract.
b. Insurance must be maintained for at least five (5) years after completion of the Services.
c. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a
Retroactive Date prior to the Contract Effective Date, the Consultant must purchase "extended
reporting" coverage for a minimum of five (5) years after completion of the Services.
OTHER I NSURANCE PROVISIONS
The aforementioned insurance policies shall contain, be endorsed and have all the following conditions and
prov1s1ons:
A dditional In sured Status
The City of Cupertino, its C ity Council, officers, officials, employees, agents, and volunteers ("Additional
Insureds") are to be covered and endorsed as additional insureds on Consultant's CGL and automobile liability
policies. General Liability coverage can be provided in the form of an endorsement to Consultant's insurance
(at least as broad as ISO Form CG 20 10 (11/ 85) or ifnot available, through the addition of both CG 20 10 and
CG 20 37 fonns, if later editions are used).
Primary and No n-Contributory Coverage
Except Workers Compensation, coverage afforded to City/Additional Insureds shall allow and be end orsed
primary insurance. Any insurance or self-i nsurance maintained by City, its officers, officials, employees, or
volunteers shall be excess of Consultant's insurance and shall not contribute to it.
N otice of Cancellation
Each insurance policy shall state that coverage shall not be canceled or allowed to expire, except with written
notice to City 30 days in advance or 10 days in advance if due to non-payment of premiums. If a carrier w il l
not provide the required notice of cancellation or policy modification, the Consultant shall provide written
notice to the City of a cancellation or policy modification no later than 30 days in advance or 1 O days in
advance if due to non-payment of premiums.
Waiver of Subrogation
Consultant waives any right to subrogation against City/Additional Insureds for recovery of damages to the
extent said losses are covered by the insurance policies required herein. Specifically, the General Liability.
Automobile Liability and Workers' Compensation policies shall allow and be endorsed with a waiver of
subrogation in favor of City, its employees, agents and volunteers. This provision applies regardless of whether
or not the City has rece ived a waiver of subrogation endorsement from the insurer.
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Deductibles and Self-Insured Retentions
Any deductible or self-insured retention must be declared to and approved by the City (Insert on the Certificate
oflnsurance, if zero, insert "$0"). At City's option, either: the insurer must reduce or e liminate the deductible
or self-insured retentions as respects the City/ Additional Insureds; or Consultant must show proof of ability to
pay losses and costs related investigations, claim administration and defense expenses. The policy shall provide,
or be endorsed to provide, that the self-insured retention may be satisfied by either the insured or the City.
Acceptability of Insurers
Insurance shall be placed with insurers admitted in the State of California and with an AM Best rating of A
VII or higher.
Verification of Coverage
Consultant must furnish acceptable insurance certificates and amendatory endorsements ( or copies of the policies
effecting the coverage required by this Contract), including a copy of the Declarations and Endorsement Page
of the CGL policy list ing all policy endorsements prior to commencement of the Contract. City retains the right
to demand verification of compliance at a ny time during the Contract term.
Subconsultants
Consultant shall require and verify that all subconsultants maintain insurance that meet the requirements of this
Contract, including indemnification, defense, and naming the City as an additional insured on subconsultant's
insurance policies.
Higher Insurance Limits
If Consultant maintains broader coverage and/or higher limits than the minimums shown above, City shall be
entitled to coverage for the higher insurance limits maintained by Consultant.
Adequacy of Cover"ge
City reserves the right to modify these insurance requirements/coverage based on the nature of the risk , prior
experience, insurer or other special circumstances, with not less than ninety (90) days prior written notice.
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