07 Staff Report
PREPARED BY: Matt Morley
Director of Parks and Public Works
Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, and Finance Director
110 E. Main Street Los Gatos, CA 95030 ● (408) 354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 02/02/2021 ITEM NO: 7
DATE: January 25, 2021
TO: Mayor and Town Council
FROM: Laurel Prevetti, Town Manager
SUBJECT: Approve a First Amendment to a Parking Agreement with Tesla, Inc. for the
Installation of Eight Additional Charging Stations in the North Parking Lot,
Resetting the Term, Establishing Lease Payments to the Town of $8,000 per
Month, and Approve a Revenue Budget Adjustment in the Amount of
$48,000 to Reserve the Lease Proceeds in the General Fund Appropriated
Reserve that will be Transferred to the Future Downtown Parking Fund to
Collect Parking Revenue for Infrastructure Improvements in Downtown
RECOMMENDATION:
Approve a first amendment (Attachment 1) to a Charging Station Agreement with Tesla, Inc.
(Attachment 2) for the installation of eight additional charging stations in the North Parking Lot,
resetting the term, establishing lease payments to the Town of $8,000 per month, and approve
a revenue budget adjustment in the amount of $48,000 to reserve the lease proceeds in the
General Fund Appropriated Reserve that will be transferred to the future Downtown Parking
Fund to collect parking revenue for infrastructure improvements in downtown.
BACKGROUND:
On December 19, 2017, the Town Council approved an agreement with Tesla, Inc. for the
installation of electric vehicle charging stations in the North Parking Lot. This agreement
resulted in the installation of 12 quick charge spots for Tesla vehicles and four level two
charging spots for non-Tesla users with no fee for charging. The contract established the term
as five years with a five-year option for renewal.
During construction, Tesla installed the underground infrastructure for a future addition of
another eight charging stations. In early 2020, Tesla approached Town staff on the opportunity
for implementing that expansion. Staff told Tesla that it was open to the expanded use, and
PAGE 2 OF 3 SUBJECT: Approve a First Amendment to a Parking Agreement with Tesla, Inc. DATE: January 25, 2021
BACKGROUND (continued):
that the expansion would require a lease agreement at market rate. Some negotiations on the
rate occurred and Tesla determined that they were not interested at that time.
Tesla reached out again to Town staff later in the year having changed their position and
offering to accept the market rate Town staff had identified.
DISCUSSION:
The addition of charging stations in the North Parking Lot provides a number of benefits to the
Town. Electric vehicles aid in greenhouse gas (GHG) emission reductions. The Tesla stations
complement the Town’s 14 Chargepoint stations and the recent installation of Charge America
stations installed at the Bank of America parking lot on North Santa Cruz Ave. Combined, these
demonstrate the Town’s commitment to GHG emission reductions. Additionally, the
convenience of the charging stations is expected to draw drivers to the downtown, providing
increased opportunity for shopping and dining.
The proposed amendment would reset the term of the agreement, restarting the first five-year
period, while retaining the five-year option to renew. This is beneficial to the Town for the
significant revenue the project is expected to bring in.
The agreement would commit Tesla to payments of $8,000 per month to the Town. Staff
recommends holding the revenue in a newly established Downtown Parking Fund where use of
the funds is restricted to downtown parking improvements. Any future parking revenue could
also contribute to this fund.
CONCLUSION:
Staff recommends approval of the amendment to the agreement with Tesla, Inc. and the
establishment of a Downtown Parking Fund for parking revenue.
COORDINATION:
This item has been coordinated with the Police and Finance Departments.
FISCAL IMPACT:
Approval of the recommendation would establish a new revenue source for the Town of
$96,000 annually and would establish a Downtown Parking Fund for the revenue to fund future
downtown infrastructure improvements.
PAGE 3 OF 3 SUBJECT: Approve a First Amendment to a Parking Agreement with Tesla, Inc. DATE: January 25, 2021
ENVIRONMENTAL ASSESSMENT:
This is not a project defined under CEQA, and no further action is required.
Attachments:
1. First Amendment to a Charging Station Agreement with Tesla, Inc.
2. Charging Station Agreement