REPORT TO COUNCIL
SUBJECT
Title
Action on a Resolution of Intention for Parking Maintenance District No. 122 - Franklin Square
Report
BACKGROUND
Parking Maintenance District No. 122 (PMD 122) was formed in 1965 for the parking lots, arcades, fountains, sidewalks, landscaping, irrigation, lights, and utilities within Franklin Square, which is bounded by Benton Street, Homestead Road (formerly known as Liberty Street), Monroe Street, and Jackson Street. There have been several changes in how maintenance and operation costs have been collected over the years. In 2002, the City Council passed a motion at a public hearing in which the City assumed all future costs for operation and maintenance, and in May 2003 adopted Resolution 7026. Under the collection method contained in Resolution 7026, the property owners contribute annually to pay for capital repairs of the parking lot and associated walkways. The fixed annual contribution from the property owners totals $14,200, less the earned interest on the accumulating balance. The City, through the General Fund, is responsible for covering the costs for annual maintenance and operations of PMD 122 and that has continued to be the arrangement through the present day. The City Council approved a Resolution Approving the Levy of Benefit Assessment upon the City of Santa Clara Parking Maintenance District No. 122 - Franklin Square in FY 2025/26, so contributions from the property owners were collected.
DISCUSSION
Adoption of the proposed resolution is the initial step necessary to set the annual budget for PMD 122. The approval process requires the preparation of a Director’s Report (Attachment 1) explaining the preparation and basis of assessments; publication and posting of a Notice of Public Hearing (Attachment 2); and holding a public hearing on the annual assessments. Following approval of the subject Resolution of Intention (Attachment 3), each property owner will be sent a letter containing the proposed FY 2026/27 assessment and details on a June 9, 2026 public hearing to approve the assessments.
Per prior communications and direction from the City Council during the 2025 Priority Setting session, staff from the Department of Public Works (DPW), City Attorney’s Office, and City Manager’s Office have coordinated logistical items associated with initiating a paid parking program at Franklin Square. DPW staff held two meetings with the public, property owners, and tenants about the potential for paid parking. Based on that feedback, staff developed a Request for Proposals (RFP) to perform a Study, however, City Council did not approve funding for the Franklin Square Paid Parking Study at the April 7, 2026 meeting, and elected to stop any further efforts related to paid parking at Franklin Square.
Since PMD 122 is still active and has not been dissolved, the assessments will continue to be brought forward to the City Council annually. The proposed FY 2026/27 assessment to property owners totals $7,329. Accrued interest earned in FY 2024/25 in the amount of $6,871 will be used to reach the $14,200 annual requirement. These funds are placed into an account that generates interest income and are used to pay for capital repair projects as needed. At the close of FY 2024/25, the interest-bearing account contained $178,181.
The proposed FY 2026/27 expenditure budget for PMD 122 routine maintenance and operation is $143,012, which is $3,022 above the FY 2025/26 expenditure budget of $139,990. The full-time equivalent (FTE) position allocated to PMD remains unchanged at 0.50 FTE. The 2.2% increase in the expenditure budget in FY 2026/27 is due to small cost of living adjustments for labor, contractual services, and operating supplies, as well as adjustments to the City’s Cost Allocation Plan (CAP).
The operating budget includes funding for routine maintenance and operation performed by DPW, as well as contractors. This includes regular maintenance for landscaping, trees, public litter cans, and parking lot/walkway sweeping. Routine maintenance and operation of PMD 122 is funded by the General Fund. In FY 2025/26 staff made repairs to several lighting fixtures that were out of service within the parking lots and associated walkways.
In FY 2026/27, staff will be updating parking lot and associated walkway lighting to LED. The final FY 2026/27 expenditure budget includes $87,000 for exceptional maintenance and improvements. The total PMD 122 FY 2026/27 budget of $230,012 includes both routine maintenance, and exceptional maintenance and improvement costs. These capital repairs will be funded by property owner contributions, which will be transferred from the interest-bearing account. Concurrently, DPW is exploring SVP rebates and loan opportunities that could help reduce costs if the project meets eligibility requirements.
Pursuant to the 2002 City Council action, staff is recommending the adoption of the subject Resolution of Intention; setting a public hearing date of June 9, 2026, to approve the Director’s Report for FY 2026/27; and the authorization of the publication and posting of the public hearing. The assessments to the property owners cannot be sent out until the Director’s Report is approved at a public hearing. A conference call with the property owners to discuss these requirements has been scheduled for May 13, 2026. Notices for the public hearing will be sent out following adoption of the subject Resolution of Intention.
Staff has previously provided responses to Council questions about the procedures for modifying and dissolving PMD 122 as well as paid parking. Those reports are included as Attachments 4 and 5.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(b)(4) in that it is a fiscal activity that does not involve any commitment to any specific project which may result in a potential significant impact on the environment.
FISCAL IMPACT
Approval of the proposed assessment maintains the funding source for future capital repairs to parking lots and walkways located within Franklin Square. The City’s General Fund remains as the funding source for routine maintenance and operating costs for the Downtown Parking Maintenance District. The preliminary proposed FY 2026/27 expenditure budget for Parking Maintenance District No. 122 is $230,012, which is inclusive of the $87,000 of capital repairs funded by property owner assessments and subject to appropriation of funds. If the City Council does not approve charging property owners their portion of the proposed FY 2026/27 assessment of $7,329 as per PMD 122, the property owners will be relieved of this requirement for the fiscal year and will not make any contributions towards future capital repairs.
COORDINATION
This report has been coordinated with the Finance Department and the City Attorney’s Office.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
1. Adopt a Resolution of Intention to order that the alternative method for the levy of benefit assessment be made applicable to the City of Santa Clara Parking Maintenance District No. 122;
2. Set a hearing date of June 9, 2026, to approve the Director’s Report FY 2026/27; and
3. Authorize the publication, mailing, and posting of the Notice of Public Hearing as stated in the Resolution of Intention.
Staff
Reviewed by: Craig Mobeck, Director of Public Works
Approved by: Jovan Grogan, City Manager
ATTACHMENTS
1. Director’s Report FY 2026/27
2. Notice of Public Hearing
3. Resolution of Intention
4. Agenda Report 22-1672 from January 25, 2022
5. Agenda Report 22-713 from June 21, 2022