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HomeMy WebLinkAbout03-02-2021 FORMAL SESSION AGENDA CITY OF VIRGINIA BEACH "COMMUNITY FOR A LIFETIME" CITY COUNCIL Cies111'BEAc MAYOR ROBERT M. "BOBBY"DYER,At Large 41-, �`}'., L VICE MAYOR JAMES L. WOOD,Lynnhaven-District 5 p�c' JESSICA P.ABBOTT,Kempsville-District 2 % C' MICHAEL F.BERLUCCHI,Rose Hall-District 3 BARBARA M.HENLEY,Princess Anne-District 7 �' LOUIS R.JONES,Bayside-District 4 ;, r' - s JOHND.MOSS,At Large '*r AARONR.ROUSE,At Large °F OUR MOSOYS GUYK.TOWER,Beach-District 6 ROSEMARY WILSON,At Large SABRINA D. WOOTEN,Centerville-District I CITY HALL BUILDING CITY COUNCIL APPOINTEES 2401 COURTHOUSE DRIVE CITY MANAGER—PATRICKA.DUHANEY CITY COUNCIL AGENDA VIRGINIA BEACH, VIRGINIA 23456-9005 CITY ATTORNEY-MARK D.STILES PHONE:(757)385-4303 CITY ASSESSOR-RONALD D.AGNOR March 2,2021 FAX(757)385-5669 CITY AUDITOR-LYNDON S.REMIAS E-MAIL:CITYCOUNCIL@vbgov.com CITY CLERK-AMANDA BARNES MAYOR ROBERT M. "BOBBY"DYER PRESIDING I. INFORMAL SESSION - Virginia Beach Convention Center- 2:00 PM A. CALL TO ORDER—Mayor Robert M. "Bobby" Dyer B. CITY COUNCIL ROLL CALL C. RECESS TO CLOSED SESSION II. RECONVENE INFORMAL SESSION - Virginia Beach Convention Center- 5:00 PM III. COUNCIL LIAISON REPORTS IV. CITY COUNCIL COMMENTS V. CITY COUNCIL AGENDA REVIEW VI. FORMAL SESSION - Virginia Beach Convention Center- 6:00 PM A. CALL TO ORDER—Mayor Robert M. "Bobby"Dyer B. INVOCATION C. PLEDGE OF ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA D. ELECTRONIC ROLL CALL OF CITY COUNCIL E. CERTIFICATION OF CLOSED SESSION F. MINUTES 1. SPECIAL SESSION February 9, 2021 2. SPECIAL SESSION February 16, 2021 G. FORMAL SESSION AGENDA 1. CONSENT AGENDA H. ORDINANCES/RESOLUTIONS 1. Resolution to ADOPT a Revised Policy re investment of City Funds 2. Resolution to APPROVE a contract extension between the Virginia Beach Community Services Board and the Commonwealth of Virginia re mental health, developmental and substance use disorder services 3. Ordinance to SUPPORT the 2021 Ignite Seminar Series and Disparity Forum and APPROPRIATE $2,325 from General Fund Balance to Municipal Council re offset expenses (Requested by Council Member Wooten) 4. Ordinance to RESCIND the previous award of franchises to Bird Rides, Inc.,Neutron Holdings, Inc., Skinny Labs, Inc., and VeoRide, Inc., and DIRECT the City Manager to resolicit proposals for such franchises 5. Ordinance to EXTEND the provisions of the Ordinance previously adopted on March 31, 2020 re ensure continuity of government during the COVID-19 Disaster 6. Ordinance to EXTEND the Sunset Date to April 5, 2022, re residential permit parking in the Historic Cavalier Shores Neighborhood 7. Ordinance to AUTHORIZE a grant of up to $150,000 from the City Council Special Pandemic and Vaccine Support Reserve to the Oceana Volunteer Fire Department, Inc., re the purchases of a fire support vehicle, and AUTHORIZE donation of a truck(Requested by City Council) 8. Ordinance to APPROPRIATE $6,948.10 to the FY2020-21 Emergency Medical Services (EMS) Operating Budget re reimburse auction proceeds to the Plaza Volunteer Rescue Squad, Inc. I. PLANNING 1. QUAN LE for a Conditional Use Permit re short term rental at 1612 Tallwood Manor Court DISTRICT 1 - CENTERVILLE RECOMMENDATION: APPROVAL 2. JONATHAN WEST for a Conditional Use Permit re short term rental at 4814 Lake Drive DISTRICT 4—BAYSIDE RECOMMENDATION: APPROVAL 3. ALFRED NICOLL for a Conditional Use Permit re short term rental at 113 55th Street, Unit A DISTRICT 5 —LYNNHAVEN RECOMMENDATION: APPROVAL 4. KAREN AND JOE ALLEN/OLD HICKORY INVESTMENTS, LLC for a Conditional Use Permit re short term rental at 1361 Goose Landing DISTRICT 6—BEACH RECOMMENDATION: APPROVAL 5. BAO LO for a Conditional Use Permit re short term rental at 619 25th Street DISTRICT 6— BEACH RECOMMENDATION: STAFF—APPROVAL PLANNING COMMISSION—DENIAL 6. WILLIAM JOSEPH WRIGHT,JR. for a Conditional Use Permit re short term rental at 911 Pacific Avenue, Unit B DISTRICT 6—BEACH RECOMMENDATION: APPROVAL 7. D AND D CREATIONS, LLC/DANIEL AND KELLIE JO DAVID REVOCABLE TRUST for a Conditional Use Permit re short term rental at 2621 Highland Meadows Way DISTRICT 7—PRINCESS ANNE RECOMMENDATION: APPROVAL J. APPOINTMENTS 2040 VISION TO ACTION COMMUNITY COALITION ARTS AND HUMANITIES COMMISSION BAYFRONT ADVISORY COMMISSION BIKEWAYS AND TRAILS ADVISORY COMMITTEE CLEAN COMMUNITY COMMISSION COMMUNITY POLICY AND MANAGEMENT TEAM COMMUNITY SERVICES BOARD DEFERRED COMPENSATION BOARD GREEN RIBBON COMMITTEE HAMPTON ROADS PLANNING COMMISSION HEALTH SERVICES ADVISORY BOARD HISTORIC PRESERVATION COMMISSION HOUSING ADVISORY BOARD HUMAN RIGHTS COMMISSION INVESTIGATION REVIEW PANEL MEDAC OLD BEACH DESIGN REVIEW COMMITTEE OPEN SPACE ADVISORY COMMITTEE PERSONNEL BOARD PLANNING COUNCIL PROCESS IMPROVEMENT STEERING COMMITTEE PUBLIC LIBRARY BOARD RESORT ADVISORY COMMISSION SENIOR SERVICES OF SOUTHEASTERN VIRGINIA SOUTHEASTERN PUBLIC SERVICE AUTHORITY TRANSITION AREA/INTERFACILITY TRAFFIC AREA CITIZENS ADVISORY COMMITTEE VIRGINIA BEACH COMMUNITY DEVELOPMENT CORPORATION K. UNFINISHED BUSINESS L. NEW BUSINESS M. ADJOURNMENT *********************** OPEN DIALOGUE Non-Agenda Items Each Speaker will be allowed 3 minutes and each subject is limited to 3 Speakers ********************************** If you are physically disabled or visually impaired and need assistance at this meeting, please call the CITY CLERK'S OFFICE at 385-4303 *****.***************.**..*** The Agenda(including all backup documents) is available at https://www.vbgov.com/government/departments/city-clerk/city-council under the eDocs Document Archive. If you would like to receive by email a list of the agenda items for each Council meeting, please submit your request to pmcgraw@vbgov.com or call 385-4303. If you wish to make comments during the meeting,please follow the two-step process provided below: 1. Register for the WebEx at: https://vbgov.webex.com/vbgov/onstage/g.php?MTID=e 1 aba56b760743d7822e70c49e93 a5a3d 2. Register with the City Clerk's Office by calling 757-385-4303 or via email at prior to 5:00 p.m. on March 2, 2021. MAYOR ROBERT M. "BOBBY"DYER PRESIDING I. INFORMAL SESSION -Virginia Beach Convention Center- 2:00 PM A. CALL TO ORDER—Mayor Robert M. "Bobby"Dyer B. CITY COUNCIL ROLL CALL C. RECESS TO CLOSED SESSION II. RECONVENE INFORMAL SESSION - Virginia Beach Convention Center- 5:00 PM III. COUNCIL LIAISON REPORTS IV. CITY COUNCIL COMMENTS V. CITY COUNCIL AGENDA REVIEW VI. FORMAL SESSION - Virginia Beach Convention Center- 6:00 PM A. CALL TO ORDER—Mayor Robert M. "Bobby" Dyer B. INVOCATION C. PLEDGE OF ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA D. ELECTRONIC ROLL CALL OF CITY COUNCIL E. CERTIFICATION OF CLOSED SESSION F. MINUTES 1. SPECIAL SESSION February 9, 2021 2. SPECIAL SESSION February 16, 2021 G. FORMAL SESSION AGENDA 1. CONSENT AGENDA H. ORDINANCES/RESOLUTIONS 1. Resolution to ADOPT a Revised Policy re investment of City Funds 2. Resolution to APPROVE a contract extension between the Virginia Beach Community Services Board and the Commonwealth of Virginia re mental health, developmental and substance use disorder services 3. Ordinance to SUPPORT the 2021 Ignite Seminar Series and Disparity Forum and APPROPRIATE $2,325 from General Fund Balance to Municipal Council re offset expenses (Requested by Council Member Wooten) 4. Ordinance to RESCIND the previous award of franchises to Bird Rides, Inc.,Neutron Holdings, Inc., Skinny Labs, Inc., and VeoRide, Inc., and DIRECT the City Manager to resolicit proposals for such franchises 5. Ordinance to EXTEND the provisions of the Ordinance previously adopted on March 31, 2020 re ensure continuity of government during the COVID-19 Disaster 6. Ordinance to EXTEND the Sunset Date to April 5, 2022, re residential permit parking in the Historic Cavalier Shores Neighborhood 7. Ordinance to AUTHORIZE a grant of up to $150,000 from the City Council Special Pandemic and Vaccine Support Reserve to the Oceana Volunteer Fire Department, Inc., re the purchases of a fire support vehicle, and AUTHORIZE donation of a truck(Requested by City Council) 8. Ordinance to APPROPRIATE $6,948.10 to the FY2020-21 Emergency Medical Services (EMS) Operating Budget re reimburse auction proceeds to the Plaza Volunteer Rescue Squad, Inc. • • CITY OF VIRGINIA BEACH AGENDA ITEM i ITEM: A Resolution Adopting a Revised Policy for the Investment of City Funds MEETING DATE: March 2, 2021 ■ Background: The City Council first adopted a policy (the "Investment Policy")for the investment of City funds in 1986. The most recent update to the Investment Policy was adopted by the City Council in 2014. The purpose of the Investment Policy is to provide for the prudent investment of City funds. The City Treasurer, as custodian of City funds pursuant to Section 8.03 of the City Charter, is responsible for the investment of City funds. Many requirements for the investment of public funds are set forth in the Virginia Code. Additionally, the Government Finance Officer Association (GFOA) promulgates best practices to assist officers that manage the investment of public funds. IN Considerations: The City Treasurer, in coordination with the Department of Finance, has provided an update to the Investment Policy. The revisions reflect changes in state law and align the Investment Policy with current GFOA best practices. • Public Information: Public information will be provided through the normal Council agenda process. ■ Recommendations: Adopt the attached resolution. • Attachments: Resolution, Investment Policy; List of Substantive Changes Recommended Action: Approval Submitting Department/Agency: City Treasurer's Office City Manager: '• 7 1 A RESOLUTION ADOPTING A REVISED POLICY 2 FOR THE INVESTMENT OF CITY FUNDS 3 4 WHEREAS, the City Council adopted a policy for the investment of City funds on 5 May 28, 1996, and this policy was most recently updated by the City Council in 2014; 6 7 WHEREAS, the purpose of the policy is to provide for the prudent investment of 8 City funds; 9 10 WHEREAS, the City Treasurer, as custodian of City funds pursuant to Section 8.03 11 of the City Charter, is responsible for the investment of City funds; 12 13 WHEREAS, it is important that the City funds be invested in accordance,with the 14 Code of Virginia and prudent fiduciary standards; and 15 16 WHEREAS, the City Treasurer.has recommended the adoption of the attached 17 revised Investment Policy. 18 19 NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF 20 VIRGINIA BEACH, VIRGINIA: 21 22 That the attached City of Virginia Beach Investment Policy is hereby adopted, and 23 the Treasurer is hereby directed to use the Investment Policy for the investment of the 24 City's funds. Adopted by the Council of the City of Virginia Beach, Virginia, on the day of —__ , 2021. APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY City Treasurer r ey's Office CA15330 R-1 February 17, 2021 CITY OF VIRGINIA BEACH,VIRGINIA INVESTMENT POLICY PREAMBLE The City Council,elected officials,appointed officers,and employees of the City of Virginia Beach recognize their fmancial stewardship responsibilities to the citizens of Virginia Beach. A critical area of this fmancial stewardship is the investment of the city's cash balances,for with the City Treasurer bears primary responsibility. Recognizing the advantages of a safe and effective investment program for the city's funds,the City Council and City Treasurer jointly acknowledge the need for and hereafter accept this investment policy as it may be amended from time to time. City of Virginia Beach,Virginia Investment Policy (Revised February 2021) CITY OF VIRGINIA BEACH,VIRGINIA INVESTMENT POLICY TABLE OF CONTENTS Page Purpose 3 II. Scope 3 III. Objective 3 1. Safety 3 A. Credit Risk 4 B. Interest Rate Risk 4 2. Liquidity 4 3. Yield 4 IV. Standards of Care 4 1. Prudence 4 2. Ethics and Conflicts of Interest 5 3. Delegation of Authority 5 V. Safekeeping,Custody,and Program Integrity 5 1. Authorized Financial Dealers and Institutions 5 2. Internal Controls 6 3. Delivery vs.Payment(DVP) 6 4. Independent Review 6 VI. Suitable and Authorized Investments 6 1. Investment Types 6 2. Collateralization 7 3. Repurchase Agreements 7 VII. Investment Parameters 8 1. Diversification 8 2. Maximum Maturities 8 3. Competitive Bids 8 VIII. Reporting. 8 1. Methods 8 2. Performance Standards 9 3. Mark to Market 9 IX. Policy 9 1. Exemption 9 2. Amendments 9 X. GFOA Recommended Practices 9 XI. Glossary of Terms 10 Appendices: A. Virginia Security for Public Deposits Act 15 B. Broker/Dealer Questionnaire and Certification 20 C. Investment Guidelines for Bankers'Acceptances 23 D. Investment Guidelines for Commercial Paper 25 E. Government Finance Officers'Association Recommended Practices Pertaining to Cash Management and Investing Activities 27 F. Various Code of Virginia Provisions Pertaining to Investment of Local Government Funds 55 2 I. PURPOSE The purpose of this policy is to provide a guide for the actions of individuals responsible for the investment of city funds. In general,it is the policy of the city that its funds be invested in a manner which will provide the highest investment returns only after the goals of maximum security/safety,meeting daily cash flow demands,and conformance with all state and local statutes governing the investment of public funds have been met. In pursuing this objective,individuals investing city funds are to be guided by the"prudent person rule." The prudent person rule provides that, 'Investments shall be made with judgment and care—under circumstances then prevailing—which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of capital as well as the probable income to be derived.' II. SCOPE This investment policy applies to the investment activities of all cash financial assets of the government of the City of Virginia Beach,except for assets of the employee retirement system,the employee deferred compensation plan,funds separately invested in accordance with bond resolutions for indentures(e.g.,debt service funds,irrevocable escrow funds established by a refunding bond issue,etc.),and funds required to be separately invested in accordance with an escrow agreement,trust agreement,or other legally adopted contractual arrangement. Funds subject to this policy are accounted for in the city's Comprehensive Annual Financial Report and include: • General Fund • Special Revenue Funds • Capital Project Funds • Proprietary Funds • Trust and Agency Funds • Any other fund created,unless specifically exempted by this policy or by separate action of the City Council. Except as may be specifically noted herein,this investment policy applies to all transactions involving the financial assets and related activities of all the foregoing funds. Except for cash in certain restricted and special funds,the City of Virginia Beach will consolidate cash and reserve balances from all funds to maximize investment earnings and to increase efficiencies with regard to investment pricing,safekeeping and administration. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles. III. OBJECTIVE The primary objectives,in priority order,of the city's investment activities shall be: 1. Safety Safety of principal is the foremost objective of the city's investment program. Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. The goal is to mitigate credit risk and interest rate risk. 3 A. Credit Risk Credit risk is the risk of loss due to the fmancial failure of the security issuer or backer. Credit risk may be mitigated by: • Limiting investments to the safest types of securities; • Pre-qualifying the financial institutions,brokers/dealers,intermediaries,and advisors with which the city will do business;and • Diversifying the investment portfolio so that potential losses on individual securities will be minimized. B. Interest Rate Risk Interest rate risk is the risk that the market value of securities in the portfolio will fall due to changes in general interest rates. Interest rate risk may be mitigated by: • Structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations,thereby avoiding the need to sell securities on the open market prior to maturity;and • By investing operating funds primarily in shorter-term securities. 2. Liquidity The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrent with cash needs to meet anticipated demands(static liquidity). Furthermore, since all possible cash demands cannot be anticipated,the portfolio should consist largely of securities with active secondary or resale markets(dynamic liquidity). Alternatively,a portion of the portfolio may be placed in money market mutual funds provided that the funds are registered under the Securities Act of the Commonwealth or the Federal Investment Co.Act of 1940,and that the investments by such funds are restricted to investments otherwise permitted by law for political subdivisions as set forth in the Investment of Public Funds Act,or investments in other such funds whose portfolios are so registered,or local government investment pools which offer same-day liquidity for short-term funds. 3. Yield The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles,taking into account the investment risk constraints and liquidity needs. Return on investment is of least importance compared to the safety and liquidity objectives described above. The core of investments is to be limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed. Securities shall not be sold prior to maturity,with the following exceptions: • A declining credit security could be sold early to minimize loss of principal; • A security swap which would improve the quality,yield,or target duration in the portfolio;or • Liquidity needs of the portfolio require that an appropriately selected security be sold. IV. STANDARDS OF CARE 1. Prudence The standard of prudence to be used by the city's investment officials shall be the"prudent person"standard and shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and this investment policy and exercising due diligence shall be relieved of personal responsibility for a specific security's credit risk or market price changes,provided negative deviations from expectations are reported in a timely 4 fashion and the liquidation or sale of such securities is carried out in accordance with the terms of this policy. As stated previously,the prudent person standard provides that, `Investments shall be made with judgment and care,under circumstances then prevailing,which persons of prudence,discretion, and intelligence exercise in the management of their own affairs,not for speculation,but for investment,considering the probable safety of capital as well as the probable income to be derived.' 2. Ethics and Conflicts of Interest Officers and employees,including those involved in the City's investment process,are governed by the State and Local Government Conflict of Interests Act. Specifically,Code of Virginia§2.2- 3103 (5)and(6)of the Act provide that no officer or employee shall: (a) accept any money,loan,gift,favor,service,or business or professional opportunity that reasonably tends to influence him in the performance of his official duties;or (b) accept any business or professional opportunity when he knows that there is a reasonable likelihood that the opportunity is being afforded him to influence him in the performance of his official duties. To ensure that personal investment or business transactions do not violate these provisions or any other provision of the State and Local Government Conflict of Interests Act,officers and employees must(1)familiarize themselves with this Act and(2)carefully scrutinize how their personal interest may affect or be affected by the transactions that are part of the City's investment process. 3. Delegation of Authority The City Treasurer,who is the custodian of the City's monies pursuant to§8.03 of the Charter of the City of Virginia Beach,shall have responsibility for the operation of the investment program. The City Treasurer shall follow established written procedures and maintain internal controls for the operation of the investment program in a manner consistent with this investment policy. Procedures should include references to: safekeeping,delivery vs.payment,investment accounting,repurchase agreements,wire transfer agreements,collateral/depository agreements, and banking service contracts. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the City Treasurer. The City Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials. V. SAFEKEEPING,CUSTODY,AND PROGRAM INTEGRITY 1. Authorized Financial Institutions and Dealers The City Treasurer will maintain a list of financial institutions and dealers authorized to provide investment services. Financial institutions shall be"qualified public depositories"in accordance with provisions of the Virginia Security For Public Deposits Act(Code of Virginia§2.2-4400),as amended(copy attached as Appendix A),and must be designated a city depository in accordance with§ 2-226 of the City Code. In addition,the City Treasurer will also maintain a list of approved security broker/dealers selected by creditworthiness(minimum capital requirement$10,000,000 and at least five years of operation). These may include"primary"dealers or regional dealers that qualify under the Securities and Exchange Commission Rule 15C3-1 (uniform net capital rule). All financial institutions and broker/dealers who desire to become qualified bidders for investment transactions must supply the following as appropriate: 5 • Audited fmancial statements • Proof of Financial Industry Regulatory Authority membership • Proof of State registration • Completed City of Virginia Beach Broker/Dealer Questionnaire(not applicable to Certificate of Deposit counterparties) • Certification of having read,understood,and agreed to comply with the City of Virginia Beach's investment policy. • Evidence of adequate insurance coverage. An annual review of the fmancial condition and registration of qualified bidders will be conducted by the City Treasurer. 2. Internal Controls The City Treasurer is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the city are protected from loss,theft,or misuse. The internal control structure shall be designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that(a)the cost of a control should not exceed the benefits likely to be derived;and(b)the valuation of costs and benefits requires estimates and judgments by management. The internal controls shall include,but are not limited to the following: A.Control of collusion. B. Separation of reconciliation from accounting/record keeping. C. Custodial safekeeping. D. Avoidance of physical possession and/or delivery of securities. E. Clear delegation of authority to subordinate staff. F. Written confirmation of telephone transactions for investments. G. Maintenance of current contracts/agreements with the lead bank and third-party custodian. 3. Delivery vs.Payment All security transactions,including collateral for repurchase agreements,will be executed by delivery vs.payment(DVP). This ensures that securities are deposited in the appropriate safekeeping institution prior to the release of funds. Securities will be held by a third-party custodian as evidenced by safekeeping receipts with a written custodial agreement. The safekeeping institution shall annually provide a copy of their most recent report on internal controls(Statement on Standards for Attestation Engagements(SSAE)No. 16). 4. Independent Review To help maintain the integrity of the investment program,the City Treasurer shall establish a process for annual independent review by an external auditor to assure compliance with this policy. VI. SUITABLE AND AUTHORIZED INVESTMENTS 1. Investment Types Consistent with the Government Finance Officers'Association(GFOA)Recommended Practice on State Statutes Concerning Investment Practices,and as defined by state law where applicable, the following investments will be permitted by this policy: 6 • U.S.Government obligations,U.S. Government agency obligations,and U.S. Government instrumentality obligations,in accordance with§2.2-4501 of the Code of Virginia • Repurchase agreements,in accordance with§2.2-4507 of the Code of Virginia • Certificates of deposit,in accordance with§2.2-4509 of the Code of Virginia • Savings and loan association deposits,in accordance with§2.2-4500 of the Code of Virginia • Prime bankers'acceptances,in accordance with§2.2-4504 of the Code of Virginia and Appendix C(Investment Guidelines for Bankers'Acceptances)of this policy • Prime commercial paper,in accordance with§2.2-4502 of the Code of Virginia except as further restricted by Appendix D(Investment Guidelines for Commercial Paper)of this policy • Investment-grade obligations of state and local governments and public authorities, in accordance with§2.2-4501 of the Code of Virginia • Money market mutual funds whose portfolios consist only of domestic securities, regulated by the Securities and Exchange Commission and as provided for in§2.2- 4508 of the Code of Virginia • Virginia Local Government Investment Pool as provided for in§2.2-4600 et seq.of the Code of Virginia • Virginia Investment Pool established as a governmental trust under Section 115 of the Internal Revenue code and by the Joint Powers Act Consistent with the Government Finance Officers' Association(GFOA)Recommended Practice on the Use of Derivatives by State and Local Governments,extreme caution should be exercised in the use of derivative instruments. The City Treasurer should carefully consider the factors outlined in the GFOA recommended practice when contemplating any derivative-type investment. (See GFOA Recommended Practices,Appendix E). 2. Collateralization In accordance with Virginia law(Virginia Security for Public Deposits Act, §2.2-4400 et seq.of the Code of Virginia)and the GFOA Recommended Practice on the Collateralization of Public Deposits,collateralization is required on all demand deposit accounts,including checking accounts and non-negotiable certificates of deposit,and repurchase agreements. The Virginia Security for Deposits Act adopted the concept of mutuality of responsibility,involving a cross guarantee among all banks holding public deposits. In the event of default by one financial institution,an assessment levied against all participating institutions will cover all uncollateralized public deposits. Collateral may be held by an independent third party with whom the City of Virginia Beach has a current written custodial agreement. (See GFOA Recommended Practices,Appendix E) 3. Repurchase Agreements Use and collateralization of repurchase agreements should be consistent with GFOA Recommended Practices on Repurchase Agreements. (See GFOA Recommended Practices,Appendix E) 7 VII. INVESTMENT PARAMETERS 1. Diversification Investments are to be diversified in accordance with the provisions of this policy by: • limiting investments to avoid over-concentration in securities from a specific issuer or business sector(excluding U.S.Treasury securities), • investing in securities with varying maturities,and • continuously investing a portion of the portfolio in readily available funds such as local government investment pools(LGIPs),money market funds or overnight repurchase agreements to ensure that appropriate liquidity is maintained in order to meet ongoing obligations. (See the GFOA Recommended Practice on"Diversification of Investments in a Portfolio"in Appendix E. 2. Maximum Maturities Generally,the City Treasurer shall limit maximum final stated maturities of investments covered by this policy to five years. To the extent possible,the Treasurer will attempt to match investments with anticipated cash flow requirements. Unless matched to a specific cash flow,the Treasurer will not directly invest in securities maturing more than five(5)years from the date of purchase. The Treasurer shall determine the appropriate average weighted maturity of the portfolio consistent with the investment objectives. Reverse and escrow funds may be invested in securities exceeding five(5)years to maturity if the maturities of such investments are made to coincide as nearly as practicable with the expected use of funds. The investment of these types of funds shall be disclosed to the City Council including the disclosure of appropriate time restrictions,if applicable. 3. Competitive Bids The City Treasurer shall request competitive bids from at least(3)brokers or financial institutions for purchases of investments,except in circumstances when the Treasurer,or his/her designee, deem it necessary to do otherwise in order to meet certain investment goals,or when market conditions or circumstances dictate otherwise. Competitive bids are not required for funds invested in the state's investment pool. VIII. REPORTING 1. Methods The City Treasurer shall prepare an investment report at least quarterly,including a succinct management summary that provides a clear picture of the status of the current investment portfolio and transactions made over the last quarter. This management summary will be prepared in a manner which will indicate whether investment activities during the reporting period have conformed to the investment policy. The report shall be provided to the Finance Department. The reports will be provided to the City Manager and City Council upon request. The City Council may require additional information or clarification from the City Treasurer either orally or in writing. The report will include the following: • A listing of the amount and type of individual securities held at the end of the reporting period. 8 • Unrealized gains or losses resulting from market price appreciation or depreciation by listing the cost and market value of those securities over one-year duration that are not intended to be held until maturity(available at fiscal year-end). • Average weighted yield to maturity of the investment portfolio. • Listing of investment by maturity date,to include interest rate • The percentage of the total portfolio which each type of investment represents. • Year-end reporting by Level input in accordance with GASB 72 2. Performance Standards The investment portfolio will be managed in accordance with the parameters specified within this policy. The portfolio should obtain a market average rate of return during a market/economic environment of stable interest rates. Portfolio performance should be compared to appropriate benchmarks on a regular basis and at least annually in one of the quarterly reports due to City Council. 3. Mark-to Market A statement of the market value(obtained from a reputable and independent source)of the portfolio shall be prepared and reported to the Finance Department at least quarterly. This statement will be provided to the City Manager and the City Council upon request. This statement should include the market value,book value,and unrealized gain or loss on each investment in the portfolio. This will ensure that the minimal amount of review has been performed on the investment portfolio in terms of value and subsequent price volatility. Review should be consistent with the GFOA Recommended Practice on Mark-to Market Practices for State and Local Government Investment Portfolios and Investment Pools. (See GFOA Recommended Practices,Appendix E) IX. POLICY 1. Exemption Any investment held at the time of adoption of this policy that does not meet the guidelines and requirements of this policy shall be exempted from such guidelines and requirements. At maturity or liquidation,such monies shall be reinvested only as provided by this policy. 2. Amendments This policy shall be reviewed by the City Treasurer on an annual basis or more frequently as necessary. Any changes must be approved by the City Council. X. GFOA RECOMMENDED PRACTICES The Government Finance Officers' Association(GFOA)develops and approves policy statements and recommended practices pertaining to cash management and investment activities(see Appendix E). These policy statements and recommended practices are intended to serve as guidelines for state and local governments and other public bodies in the safe investment of public funds. To the extent that GFOA's policy statements and recommended practices,as they may be amended and/or adopted from time to time, do not conflict with applicable law,the provisions of this investment policy,or the safe,orderly,and efficient investment of the city's funds,the City Treasurer shall incorporate them into the city's investment program. 9 XI. GLOSSARY OF TERMS AGENCIES: Federal agency securities. ARBITRAGE: A technique employed to take advantage of price differences in separate markets. This may be accomplished by purchasing a security in one market and immediately selling in another market at a better price. As used in the context of investing public funds,arbitrage means borrowing at low tax- exempt rates and investing in taxable instruments at higher rates. The arbitrage rebate provisions of the 1986 tax reform act govern this type of activity. ASKED: The price at which securities are offered. BANKERS'ACCEPTANCES(BAs): Negotiable time drafts drawn on commercial banks to fmance the import,export,shipment and storage of goods. Bankers'acceptances are backed by the credit of the bank, which assumes primary liability. The acceptance is further collateralized by the goods in shipment or storage. BASIS POINT: One-one hundredth of one percent. For example,one quarter of one percent would be expressed as"twenty-five basis points." BID: The price offered by a buyer of securities. (When you are selling securities,you ask for a bid.) See Offer. BOND: A written,interest bearing certificate of debt with a promise to pay on a specific date. BROKER: A broker brings buyers and sellers together for a commission. CERTIFICATE OF DEPOSIT(CD): A time deposit with a specific maturity evidenced by a certificate. Large denomination CDs are typically negotiable. COLLATERAL: Securities,evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies. COMMERCIAL PAPER: Business promissory notes,with a stated date of payment,which are usually sold at a discount and are backed by the general credit of the company. The credit of commercial paper may be enhanced by letters of credit from one or more banks. Commercial paper is generally for terms of less than 270 days;longer corporate obligations are referred to as notes or bonds and are subject to a greater degree of regulation. COMPREHENSIVE ANNUAL FINANCIAL REPORT(CAFR): The official annual report for the City of Virginia Beach. It includes combined statements for each individual fund and account group prepared in conformity with GAAP. It also includes supporting schedules necessary to demonstrate compliance with fmance-related legal and contractual provisions,extensive introductory material,and a detailed Statistical Section. COMPENSATING BALANCE: A minimum level of deposits maintained in one or more non-interest bearing accounts at a bank to defray the costs of the banking services. COUPON: (a)The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value. (b)A certificate attached to a bond evidencing interest due on a payment date. DEALER: A dealer,as opposed to a broker,acts as a principal in all transactions,buying and selling for his own account. DEBENTURE: A bond secured only by the general credit of the issuer. 10 DELIVERY VERSUS PAYMENT(DVP): There are two methods of delivery of securities: delivery versus payment and delivery versus receipt. Delivery versus payment,or DVP,is delivery of securities coincident with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities. Delivering securities DVP means that funds are not released by the trustee until the security is delivered either in physical form or through DTC. DERIVATIVE: A fmancial instrument created from or whose value depends on(is derived from)the value of one or more underlying assets or indexes of asset values. The term"derivative products"refers to instruments or features such as collateralized mortgage obligations(CMOs),interest-only(IOs)and principal only(POs),forwards,futures,currency and interest rate swaps,options,floaters/inverse floaters, and caps/floors/collars. DISCOUNT: The amount or percentage at which a security sells below par value. For example,if a bond with a$1,000 par value sells for$900,the discount is$100 or 10%. DISCOUNT SECURITIES: Non-interest bearing money market instruments that are issued at a discount and redeemed at maturity for full face value;e.g.,U.S.Treasury Bills. DIVERSIFICATION: Dividing investment funds among a variety of securities offering independent returns. Diversification is a means of reducing risk in an investment portfolio. D.K.: "Don't know." If the delivery of a security fails because the trustee was not informed to take delivery or because the security is delivered for a different amount than agreed upon,the trade is"DK'ed," meaning refused. D.T.C.: The Depository Trust Company(DTC)of New York acts as the repository for all securities which are electronic,as opposed to physical delivery. These include all U.S.Treasury and agency issues and certain issues of commercial paper. FEDERAL CREDIT AGENCIES: Agencies of the Federal Government set up to supply credit to various classes of institutions and individuals;e.g.,S&Ls,small business firms,students,farmers,farm cooperatives,and exporters. FEDERAL DEPOSIT INSURANCE CORPORATION(FDIC): A federal agency that insures bank deposits,currently up to$100,000 per deposit. FEDERAL FUNDS RATE: The rate of interest at which Fed funds are traded. This rate is currently pegged by the Federal Reserve through open-market operations. FEDERAL HOME LOAN BANKS(FHLB): The institutions that regulate and lend to savings and loan associations. The Federal Home Loan Banks play a role analogous to that played by the Federal Reserve Banks vis-à-vis member commercial banks. FEDERAL NATIONAL MORTGAGE ASSOCIATION(FNMA): FNMA,like GNMA,was chartered under the Federal National Mortgage Association Act in 1938. FNMA is a federal corporation working under the auspices of the Department of Housing and Urban Development(HUD). It is the largest single provider of residential mortgage funds in the United States. Fannie Mae,as the corporation is called,is a private stockholder-owned corporation. The corporation's purchases include a variety of adjustable mortgagees and second loans,in addition to fixed-rate mortgages. FNMA's securities are highly liquid and are widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest. 11 FEDERAL OPEN MARKET COMMITTEE(FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member,while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money. FEDERAL RESERVE SYSTEM: The central bank of the United States created by Congress and consisting of a seven member Board of Governors in Washington,D.C., 12 regional banks,and about 5,700 commercial banks that are members of the system. FINANCIAL INDUSTRY REGULATORY AUTHORITY(FINRA): A self-regulatory organization. FINRA is the largest non-governmental regulator for all securities firms doing business with the United States public. It was created in 2007 by the consolidation of the regulatory operations of the National Association for Securities Dealers(NASD)and New York Stock Exchange(NYSE). GOVERNMENT NATIONAL MORTGAGE ASSOCIATION(GNMA OR GINNIE MAE): Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks,savings and loan associations,and other institutions. Security holder is protected by full faith and credit of the U.S. Government. Ginnie Mae securities are backed by the FHA,or FMHM mortgages. The term"passthroughs"is often used to describe Ginnie Maes. JUMBO CD: A certificate of deposit of at least one hundred thousand dollars. LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market,a security is said to be liquid if the spread between bid and asked prices is narrol,-;and abler a transactions can be done at those quotes LOCAL GOVERNMENT INVESTMENT POOL(LGIP): The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment and reinvestment. MARKET VALUE: The price at which a security is trading and could presumably be purchased or sold. MASTER REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase—reverse repurchase agreements that establishes each party's rights in the transactions. A master agreement will often specify,among other things,the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller-borrower. MATURITY: The date upon which the principal or stated value of an investment becomes due and payable. MONEY MARKET: The market in which short-term debt instruments(bills,commercial paper,bankers' acceptances,etc.)are issued and traded. MUNICIPAL OBLIGATION: A security issued by a state or local government,public authority,or similar entity. These obligations are generally exempt from federal income tax. Taxable municipal obligations are issued by localities or authorities for non-public purpose projects. OFFER: The price asked by a seller of securities. (When you are buying securities,you ask for an offer.) See Asked and Bid. OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank as directed by the FOMC in order to influence the volume of money and credit in the economy. Purchases inject reserves into the banking system and stimulate growth of money and credit;sales have the opposite effect. Open market operations are an important and flexible Federal Reserve monetary policy tool. 12 PAR VALUE: The value of a security as expressed on its face without consideration of any premium, discount,or accrued interest. Par value is also known as"face amount"or"face value." PREMIUM: The amount by which the price paid for a security exceeds the par value. PORTFOLIO: Collection of securities held by an investor. PRIMARY DEALERS: Government securities dealers which submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to the Fed's informal oversight. Primary dealers include Securities and Exchange Commission(SEC)— registered securities broker-dealers,banks,and a few unregulated firms. PRINCIPAL: The amount paid for a security exclusive of accrued interest. RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price. REPURCHASE AGREEMENT(REPO): In a repo,a holder of securities sells the securities to an investor with an agreement to repurchase them at a fixed price on a certain date. The security"buyer"in effect lends the"seller"money for the period of the agreement,and the terms of the agreement are structured to compensate him for this. Dealers use repos extensively to finance their positions. REVERSE REPO: In a reverse repo,an investor owns securities,such as a Treasury note,U.S. government agency bond or other security,that a bank or dealer purchases under an agreement to sell back to the investor on a specified date,at an agreed-upon interest rate. A reverse repo is the opposite or complement to a repurchase agreement transaction—i.e.,every repo involves a reverse repo by the other party to the transaction. SAFEKEEPING: A service to customers rendered by third party banks for a fee whereby securities and collateral of all types and descriptions are held by the bank for protection. SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following their initial sale and distribution. SECURITIES&EXCHANGE COMMISSION(SEC): Agency created by Congress to protect investors in securities transactions by administering securities legislation. SEC RULE 15C3-1: See Uniform Net Capital Rule. TIME DEPOSIT: A bank deposit drawing interest at intervals and having a restrictive level of withdrawals;e.g.,a savings account. TREASURY BILLS: A discount security issued by the U.S.Treasury to fmance the national debt. Most bills are issued to mature in three months,six months,or one year. TREASURY BOND: Long-term U.S.Treasury securities having initial maturities of more than 10 years. TREASURY NOTES: A medium-term interest-bearing security issued by the U.S.Treasury to finance the national debt. TREASURY OBLIGATIONS: Securities representing obligations backed by the full faith and credit of the United States. Treasury bills are short-term obligations(3 months to 1 year),treasury notes are medium-term obligations(1 to 10 years),and treasury bonds are long-term obligations(10 to 30 years). 13 UNIFORM NET CAPITAL RULE: Securities and Exchange Commission requirement that member firms as well as non-member broker-dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1;also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm including margin loans and commitments to purchase securities,one reason new public debt issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash. U.S.AGENCY SECURITIES: Obligations issued by agencies established by the United States government. These obligations are regarded as being almost as risk free as direct treasury issues because the federal government supervises and regulates the issuers and is regarded as having a moral obligation to ensure repayment. YIELD: The rate of annual income return on an investment,expressed as a percentage. ZERO BALANCE ACCOUNT: A demand deposit account in which no cash balance is maintained overnight. As checks drawn on the account are presented,the funds necessary to pay them are transferred from a master account at the same bank. Zero balance accounts are used to control float or provide account separation for specialized purposes. 14 APPENDIX A Virginia Security For Public Deposits Act 15 §2.2-4400.Short title;declaration of intent;applicability. A.This chapter may be cited as the"Virginia Security for Public Deposits Act." B.The General Assembly intends by this chapter to establish a single body of law applicable to the pledge of collateral for public deposits in fmancial institutions so that the procedure for securing public deposits may be uniform throughout the Commonwealth. C.All public deposits in qualified public depositories that are required to be secured by other provisions of law or by a public depositor shall be secured pursuant to this chapter.Public depositors are required to secure their deposits pursuant to several applicable provisions of law,including but not limited to§§2.2- 1813,2.2-1815,8.01-582,8.01-600, 15.2-1512.1, 15.2-1615, 15.2-2625, 15.2-6611, 15.2-6637,58.1-3149, 58.1-3150,58.1-3154,and 58.1-3158. D.This chapter,however,shall not apply to deposits made by the State Treasurer in out-of-state fmancial institutions related to master custody and tri-party repurchase agreements,provided that(i)such deposits do not exceed 10 percent of average monthly investment balances and(ii)the out-of-state fmancial institutions used for this purpose have received at least one of the following short-term deposit ratings:(a)not less than A-1 by Standard&Poor's;(b)not less than P-1 by Moody's Investors Service,Inc.;or(c)not less than F 1 by Fitch Ratings,Inc. 1973,c. 172,§§2.1-359,2.1-361; 1984,c. 135;2000,cc.335,352;2001,c. 844;2010,cc.640,674;2020, c.333. §2.2-4401.Definitions. As used in this chapter,unless the context requires a different meaning: "Dedicated method"or"opt-out method"means the securing of public deposits without accepting the contingent liability for the losses of public deposits of other qualified public depositories,pursuant to§2.2- 4404 and regulations and guidelines promulgated by the Treasury Board. "Defaulting depository"means any qualified public depository determined to be in default or insolvent. "Default or insolvency"includes,but shall not be limited to,the failure or refusal of any qualified public depository to return any public deposit upon demand or at maturity and the issuance of an order of supervisory authority restraining such depository from making payments of deposit liabilities or the appointment of a receiver for such depository. "Eligible collateral"means securities or instruments authorized as legal investments under the laws of the Commonwealth for public sinking funds or other public funds as well as Federal Home Loan Bank letters of credit issued in accordance with guidelines promulgated by the Treasury Board. "Located in Virginia"means having a main office or branch office in the Commonwealth where deposits are accepted,checks are paid,and money is lent. "Pooled method"means securing public deposits by accepting the contingent liability for the losses of public deposits of other qualified public depositories choosing this method,pursuant to§2.2-4403 and regulations and guidelines promulgated by the Treasury Board. "Public deposit"means moneys held by a public depositor who is charged with the duty to receive or dminister such moneys and is acting in an official capacity,such moneys being deposited in any of the following types of accounts:nonnegotiable time deposits,demand deposits,savings deposits,or any other transaction accounts. "Public depositor"means the Commonwealth or any county,city,town or other political subdivision thereof,including any commission,institution,committee,board,or officer of the foregoing and any state court. "Qualified escrow agent"means the State Treasurer or any bank or trust company approved by the Treasury Board to hold collateral pledged to secure public deposits. "Qualified public depository"means any national banking association,federal savings and loan association or federal savings bank located in Virginia,any bank,trust company or savings institution organized under Virginia law,or any state bank or savings institution organized under the laws of another state located in Virginia authorized by the Treasury Board to hold public deposits according to this chapter. "Required collateral"of a qualified public depository means the amount of eligible collateral required to secure public deposits set by regulations or an action of the Treasury Board. "Treasury Board"means the Treasury Board of the Commonwealth created by§2.2-2415. 16 1973,c. 172, § 2.1-360; 1984,c. 135; 1987,c.718; 1996,c.77; 1998,cc.20,21;2001,c.844;2008,c. 7; 2010,cc. 640,674. §2.2-4402.Collateral for public deposits. Qualified public depositories shall elect to secure deposits by either the pooled method or the dedicated method.Every qualified public depository shall deposit with a qualified escrow agent eligible collateral equal to or in excess of the required collateral.Eligible collateral shall be valued as determined by the Treasury Board.Substitutions and withdrawals of eligible collateral may be made as determined by the Treasury Board. Notwithstanding any other provisions of law,no qualified public depository shall be required to give bond or pledge securities or instruments in the manner herein provided for the purpose of securing deposits received or held in the trust department of the depository and that are secured as required by§6.2-1005 of the Code of Virginia or that are secured pursuant to Title 12,§92a of the United States Code by securities of the classes prescribed by§ 6.2-1005 of the Code of Virginia. No qualified public depository shall accept or retain any public deposit that is required to be secured unless it has deposited eligible collateral equal to its required collateral with a qualified escrow agent pursuant to this chapter. 1973,c. 172,§ 2.1-362;2001,c. 844;2010,cc.640,674. §2.2-4403.Procedure for payment of losses by pooled method. When the Treasury Board determines that a qualified public depository securing public deposits in accordance with this section is a defaulting depository,it shall as promptly as practicable take steps to reimburse public depositors for uninsured public deposits using the following procedures: 1.The Treasury Board shall ascertain the amount of uninsured public deposits held by the defaulting depository,either with the cooperation of the Commissioner of Financial Institutions,the receiver appointed for such depository,or by any other means available. 2.The amount of such uninsured public deposits ascertained as provided in subdivision 1,plus any costs associated with liquidation,shall be assessed by the Treasury Board first against the defaulting depository to the extent of the full realizable market value of the collateral pledged to secure its public deposits. 3.In the event the realized value of the pledged collateral in subdivision 2 is insufficient to satisfy the liability of the defaulting depository to its public depositors and the Treasury Board,the Treasury Board shall assess the remaining liability against all other qualified public depositories securing public deposits according to the following ratio:total average public deposit balance for each qualified public depository held during the immediately preceding twelve months divided by the total average public deposit balance for the same period held by all qualified public depositories under this section other than the defaulting depository. 4.Assessments made by the Treasury Board in accordance with subdivision 3 shall be payable by the close of business on the second business day following demand.Upon the failure of any qualified public depository to pay such assessment when due,the State Treasurer shall promptly take possession of the eligible collateral deposited with the non-paying depository's escrow agent and liquidate the same to the extent necessary to pay the original assessment plus any additional costs necessary to liquidate the collateral. 5.Upon receipt of such assessments and the net proceeds of the eligible collateral liquidated from the State Treasurer,the Treasury Board shall reimburse the public depositors to the extent of the defaulting depository's liability to them,net of any applicable deposit insurance. 1973,c. 172,§ 2.1-363; 1978,c. 14; 1984,c. 135;2001,c. 844;2009,c.64;2010,cc.640,674. 17 §2.2-4404.Procedure for payment of losses by dedicated method. When the Treasury Board determines that a qualified public depository securing public deposits in accordance with this section is a defaulting depository,it shall as promptly as practicable take steps to reimburse public depositors of all uninsured public deposits using the following procedures: 1.The Treasury Board shall ascertain the amount of uninsured public deposits held by the defaulting depository with the cooperation of the Commissioner of Financial Institutions,the receiver appointed for such depository or by any other means available. 2.The amount of such uninsured public deposits ascertained as provided in subdivision 1,plus any costs associated with liquidation of the eligible collateral of the defaulting depository,shall be assessed by the Treasury Board against the defaulting depository.The State Treasurer shall promptly take possession of the eligible collateral deposited by such depository with the depository's escrow agent,as is necessary to satisfy the assessment of the Treasury Board and shall liquidate the same and turn over the net proceeds to the Treasury Board. 3.Upon receipt from the State Treasurer of the eligible collateral liquidated,the Treasury Board shall reimburse the public depositors from the proceeds of the collateral up to the extent of the depository's deposit liability to them,net of any applicable deposit insurance. 1984,c. 135, §2.1-363.1;2001,c. 844;2009,c. 64;2010,cc. 640,674. §2.2-4405.Powers of Treasury Board relating to the administration of this chapter. The Treasury Board shall have power to: 1.Make and enforce regulations and guidelines necessary and proper to the full and complete performance of its functions under this chapter; 2.Prescribe and enforce regulations and guidelines fixing terms and conditions consistent with this chapter under which public deposits must be secured; 3.Require additional collateral,in excess of the required collateral of any or all qualified public depositories as it may determine prudent under the circumstances; 4.Determine what securities or instruments shall be acceptable as eligible collateral,and fix the percentage of face value or market value of such securities or instruments that can be used to secure public deposits; 5.Establish guidelines to permit banks to withdraw from the procedures for the payment of losses under§ 2.2-4403 and instead be governed by the procedures for the payment of losses under§2.2-4404,consistent with the primary purpose of protecting public deposits; 6.Require any qualified public depository to provide information concerning its public deposits as requested by the Treasury Board;and 7.Determine when a default or insolvency has occurred and to take such action as it may deem advisable for the protection,collection,compromise or settlement of any claim arising in case of default or insolvency. 1973,c. 172,§2.1-364;2001,c. 844;2009,c.64;2010,cc.640,674. §2.2-4407.Mandatory deposit of public funds in qualified public depositories. Public deposits required to be secured pursuant to this chapter shall be deposited in a qualified public depository. 1973,c. 172,§2.1-366;2001,c.844;2010,cc. 640,674. 18 §2.2-4408.Authority to make public deposits. A.All public depositors are hereby authorized to make public deposits under their control in qualified public depositories,securing such public deposits pursuant to this chapter. B.Local officials handling public deposits in the Commonwealth may not require from a qualified public depository any pledge of collateral for their deposits in excess of the requirements of this chapter. 1973,c. 172, § 2.1-367; 1980,c. 538,§2.1-234.5; 1998,cc.20,21;2001,c. 844;2010,cc.640,674. §2.2-4409.Authority to secure public deposits; acceptance of liabilities and duties by public depositories. All qualified public depositories are hereby authorized to secure public deposits in accordance with this chapter and shall be deemed to have accepted the liabilities and duties imposed upon it pursuant to this chapter. 1973,c. 172,§ 2.1-368;2001,c.844;2010,cc.640,674. §2.2-4410.Liability of public depositors. When deposits are made in accordance with this chapter no official of a public depositor shall be personally liable for any loss resulting from the default or insolvency of any qualified public depository in the absence of negligence,malfeasance,misfeasance,or nonfeasance on his part or on the part of his agents. 1973,c. 172, § 2.1-370;2001,c. 844;2010,cc.640,674. §2.2-4411.Reports of qualified public depositories. By the tenth day after the end of each calendar reporting month or when requested by the Treasury Board each qualified public depository shall submit to the Treasury Board an electronic report of such data required by the Treasury Board to demonstrate that the current market value of its pledged collateral was equal to or greater than the amount of required collateral for the previous month,certified as to its accuracy by an authorized official of the qualified public depository. Upon request by a public depositor,a qualified public depository shall provide a schedule detailing the public deposit accounts reported to the Treasury Board for that depositor,as well as the amount of total public deposits held by that depository at the close of the applicable month and the total market value of the collateral securing such public deposits. 1973,c. 172,§ 2.1-369; 1979,c. 154;2001,c. 844;2010,cc. 640,674. 19 APPENDIX B BROKER/DEALER QUESTIONNAIRE AND CERTIFICATION 20 Broker/Dealer Questionnaire Section I: The City of Virginia Beach(hereinafter referred to as the"City")is a government operating under the laws of the Commonwealth of Virginia. The City has adopted a written investment policy which regulates the standards and procedures used in its cash management activities. A copy of the Investment Policy is attached to this document. The City maintains relationships with qualified members of the broker/dealer community who,in its opinion,understand the needs,constraints,and goals of the City. Section II: 1.Name of Firm: 2. Address: 3. Telephone Number(s): 4. Contact Personnel: Name: Title: Name: Title: Name: Title: 5. Is your firm a member of FINRA? 6. Place an'x' by each regulatory agency that your firm is examined by and/or subject to its rules and regulations. FDIC SEC NYSE Comptroller of Currency Federal Reserve System 7. Have you obtained all required licenses to operate as a broker/dealer in the Commonwealth of Virginia? 8. To the best of your knowledge,have there been any`material' litigation,arbitration or regulatory proceedings,adjudicated or settled,that your firm has been subject to within the last five years that involved issues concerning the suitability of the sale or purchase of securities to intuitional clients or fraudulent or unfair practices related to the sale of securities to an institutional client? If so,please describe each such matter briefly. 9. Please provide certified audited financial statements for the past fiscal year. 21 Section III: I hereby certify that the above information is true and correct to the best of my knowledge,that I have read the referenced Investment Policy,that I agree to comply with the Investment Policy,and that I am authorized to execute this request for information on behalf of my firm. Name of Firm: By: Title: Date: 22 APPENDIX C Investment Guidelines for Bankers' Acceptances 23 City of Virginia Beach Investment Guidelines for Bankers'Acceptances The following terms and conditions shall apply to investment in bankers' acceptances: 1. Prime bankers' acceptances must be issued by domestic banks with a minimum long-term debt rating of"AA"or foreign banks with a"AAA"long term debt rating by a majority of the rating services that have rated the issuer. The short-term debt rating must be at least"Al"or equivalent by all the rating services that rate the issuer(minimum of two ratings must be available). 2. Prime bankers' acceptances shall not exceed fifty percent(50%)of the total investment portfolio's book value on the date of acquisition. The amount invested in any one commercial bank pursuant to this paragraph cannot exceed fifteen percent(15%)of the book value of the portfolio on the date of acquisition or$15,000,000.00,whichever is less. 3. Prime bankers' acceptances must be eligible for purchase by the Federal Reserve System as required by TCA 9-4-602(a)(1). A prime bankers' acceptance must have an original maturity of not more than two hundred seventy(270)days to be eligible for purchase and it must: a. Arise out of the current shipment of goods between countries or within the United States,or b. Arise out of storage within the United States of goods under contract of sale or expected to move into the channel of trade within a reasonable time and that are secured throughout their life by a warehouse receipt or similar document conveying title to the underlying goods. 24 APPENDIX D Investment Guidelines for Commercial Paper 25 City of Virginia Beach Investment Guidelines for Commercial Paper The following terms and conditions shall apply to investment in commercial paper: 1. Prime commercial paper must have a maturity that does not exceed two hundred seventy(270) days. 2. Acquisition will be monitored to assure that no more than five percent(5%)of the portfolio book value at the date of acquisition,or$15,000,000,whichever is less,shall be invested in prime commercial paper of a single issuing corporation. The total holdings of an issuer's paper should not represent more than 5%of the issuing corporation's total outstanding commercial paper. 3. Purchases of prime commercial paper shall not exceed thirty-five percent(35%)of the portfolio book value at the date of acquisition. 4. Purchases must be limited to corporations that meet the following criteria: a. "Prime quality"is commercial paper that shall be rated by at least two of the following: Moody's Investors Services,Inc.,within its NCO/Moody's rating of prime 1; Standard and Poor's Inc.,within its rating of A-1;Fitch Investors Services,Inc.,within its rating of F-1,or by their corporate successors. If the corporation has senior long-term debt,it must have a minimum rating of"A"or the equivalent rating by at least two of the above listed rating services. b. The commercial paper rating must be based on the merits of the issuer or guarantee/agreement of a non-bank corporation,and not be backed by a letter of credit or insurance from a third party. c. Financial information should be obtained for reference on all corporations issuing commercial paper owned by the City of Virginia Beach. 5. Issues may be acquired from authorized broker/dealers or directly from an eligible issuer. 6. Prime commercial paper of depository institutions or of a holding company thereof shall not be held as part of the city's investment portfolio. Investments in banks should be as a depositor rather than as a creditor. Other fmance company commercial paper is eligible for investment pursuant to the credit guidelines previously described. 26 APPENDIX E Government Finance Officers' Association Recommended Practices Pertaining to Cash Management and Investment Activities 27 GOVERNMENT FINANCE OFFICERS ASSOCIATION RECOMMENDED PRACTICES • Investment Policy • Investment Program for Public Funds • Governmental Relationships with Securities Dealers • Establishing a Policy for Repurchase Agreements • Monitoring the Value of Securities in Repurchase Agreements • Collateralizing Public Deposits • Selection and Review of Investment Advisors • Use of Derivatives and Structured Investments by State and Local Governments for Non-Pension Fund Investment Portfolios • Mark-to-Market Reporting for Public Investment Portfolios • Securities Lending Programs for Non-Pension Fund Portfolios • Using Commercial Paper in Investment Portfolios • Diversifying the Investment Portfolio • Managing Market Risk in Investment Portfolios • Local Government Investment Pools • Using Safekeeping and Third-Party Custodian Services • Ensuring the Safety of Reverse Repurchase Agreements • Investment and Management of Bond Proceeds • Using Benchmarks to Assess Portfolio Risk and Return 28 Government Finance Officers Association Recommended Practice Investment Policy GFOA recommends that all governments establish a comprehensive written investment policy,which should be adopted by the governing body. An investment policy describes the parameters for investing government funds and identifies the investment objectives,preferences or tolerance for risk,constraints on the investment portfolio,and how the investment program will be managed and monitored.The document itself serves as a communication tool for the staff,elected officials,the public,rating agencies,bondholders,and any other stakeholders on investment guidelines and priorities.An investment policy enhances the quality of decision making and demonstrates a commitment to the fiduciary care of public funds,making it the most important element in a public funds investment program. GFOA recommends that all governments establish a comprehensive written investment policy,which should be adopted by the governing body. The investment policy should be reviewed and updated annually and should include statements on the following: Scope and investment objectives:Tailor the scope and investment objectives to the type of investment to which the policy applies(e.g.,excess operating funds,bond proceeds,pension fund assets). • Roles,responsibilities,and standards of care:Identify the roles of all persons involved in the investment program by title and responsibility. Standards of care should include language on prudence(i.e.,the prudent person rule),due diligence,ethics and conflicts of interest,delegation and authority,and knowledge and qualifications. • Suitable and authorized investments: Include guidelines on selecting investment types, investment advisors,interest rate risk,maturities,and credit quality,along with any collateralization requirements. • Investment diversification: State the government's approach to investment diversification, identifying the method that will be used to create a mix of assets that will achieve and maintain the government's investment objectives. • Safekeeping,custody,and internal controls:Develop guidelines to enhance the separation of duties and reduce the risk of fraud. • Authorized fmancial institutions,depositories,and broker/dealers:Establish a process for creating a list of financial institutions,depositories,and broker/dealers that will provide the primary services necessary for executing the investment program. • Risk and performance standards: Establish one or more appropriate benchmarks against which the portfolio should be measured and compared. • Reporting and disclosure standards:Define the frequency of reporting to the governing body and the government's management team. Notes: See the GFOA Resource Fixed Income Diversification Resource For Public Investing References: GFOA Sample Investment Policy See the GFOA Resource Selecting and Managing Securities Broker-Dealers for Investing See the GFOA Resource Fixed Income Diversification Resource For Public Investing 29 Government Finance Officers Association Recommended Practice Investment Program for Public Funds Governments have a fiduciary responsibility in managing their funds,including the ongoing management and monitoring of investment activity.A government's investment program should derive from the entity's Investment Policy. Developing a public funds investment program is essential to effective fmancial management,and it sets the foundation for creating protocols and internal controls,constructing and managing the portfolio, navigating changing economic conditions,and communicating information to stakeholders.While different types and sizes of governments require differing levels of complexity in their investment programs,all governments need to recognize their fiduciary responsibility.Having an established public funds investment program provides the structure to effectively set policy,make decisions,and safeguard a government's financial assets. GFOA recommends that all governments establish a public funds investment program by completing the following steps: 1. Review all applicable laws and regulations—Research all applicable federal,state/provincial,and local laws and regulations to become familiar with required parameters that may have been established by an overlapping entity. 2. Establish an investment leadership team—The investment leadership team should provide oversight,set policy and strategy,and identify appropriate individuals to administer the program. Typically,this investment leadership team may include senior-level representatives from finance, administration,risk,legal,and representatives of the governing body.This team will participate in establishing the public funds investment program. 3. Create an investment policy—Create a written investment policy,which will be adopted by the governing body.The investment policy documents key guidelines and expected outcomes during the process of establishing the public funds investment program,as well as other criteria,such as NACHA. 4. Determine the portfolio management team—Decide if the investment portfolio will be managed using internal staff and/or if the government will engage an external investment consultant. Governments should carefully consider if internal staff has the knowledge and ongoing training opportunities to perform portfolio management tasks in house. When using investment consultants(including registered investment advisors),governments should ensure that these professionals have significant experience and expertise in public funds investing and have gone through an appropriate vetting and selection process. 5. Establish risk and return objectives—Establish a risk profile that is consistent with the government's risk tolerance and a process for evaluating portfolio risk and a return objective in accord with the entity's risk tolerance,and subject to investment constraints. 6. Identify the funds being invested and develop a cash flow forecast for each—Determine which funds will be invested and whether they are excess operating funds,bond proceeds,pension fund assets,or some other type of funds.To establish the proper investment parameters for each classification of funds,estimate how frequently they will be used;this will require an understanding of cash flow requirements and preparation of an appropriate forecast. 30 Government Finance Officers Association Recommended Practice Governmental Relationships with Securities Dealers Government investors should follow GFOA recommendations pertaining to selecting securities dealers for their approved vendor list,managing the relationships with the broker/dealers,and conducting investment transactions with them. Finance officers,treasurers and investment officers(hereafter referred to as government investors)who manage and invest public funds place billions of dollars in the fixed-income and money markets on a daily basis.They have a fiduciary responsibility to protect public funds,to always act in the best interest of their entity,to maintain safety and an appropriate level of liquidity and to attain a competitive return on their portfolio. Generally,access to the securities markets is made through securities dealers who are registered broker/dealers and through fmancial institutions(banks)with broker/dealer subsidiaries.The fiduciary responsibilities of a government investor include ensuring that: • reasonable comparisons are made to judge the appropriateness of all investments; • securities meet the criteria established in the investment policy,including liquidity,diversity and risk of investments; • security transactions are made on a best execution basis through a competitive process; • the counterparty to the transaction will fulfill all of its obligations;and, • the securities are properly safe kept at a qualified custodial agent in a segregated account. It is important to note that brokers/firms may have unique strengths that may provide exceptional value within a specific category of investments,provided that you understand the security that you are purchasing,it dovetails with your investment policy,and you are aware of the risks associated with the transaction. A unique strength may compliment the skills and abilities of other approved brokers/firms. Communication with broker/dealers for the purposes of discussing market conditions,reviewing investment strategies and transacting a trade often occurs by phone,e-mail,or fax. Regardless of the method of communicating with a broker,a government investor needs to perform due diligence on all securities dealers prior to adding them to their list of approved brokers/dealers for transacting trades. GFOA makes the following specific recommendations to government investors in selecting securities dealers for their approved vendor list,managing the relationships with the broker/dealers,and conducting investment transactions with them: 1. All securities are held in a third-party bank separate from the broker/dealer that is transacting business. 2. Use a defined internal process to select,qualify,renew,or terminate brokers and dealers: • Use a questionnaire,conduct an interview,and/or conduct peer references to help determine that the broker understands the public entity's needs/objectives. • Determine that the broker is actively involved in the market sectors utilized by the government entity. • Select a number of brokers suitable to the entity,allowing for appropriate competition/service on all transactions,while limiting it to a manageable number. • Require security brokers and dealers to comply with the Federal Reserve Bank of New York's capital adequacy guidelines or SEC Net Capital Rule as a condition of doing business. Obtain annual fmancial reports of the securities firm. • Require that brokers provide written acknowledgement or certification of their review and understanding of the government entity's investment policy to assure compliance with its objectives,portfolio risk constraints,and investment trading requirements. 31 • Record and retain pertinent information on the firm and the individual broker including an annual review of the Central Registration Depository(CRD®)information for both maintained by the Financial Industry Regulation Authority(FINRA). Violations or sanctions imposed by a regulatory agency or government should be carefully reviewed for termination of relationship. • Establish parameters that guide periodic review and potential termination of a broker dealer relationship. • Do not select or approve more broker/dealers than will be reasonably used.It is better to develop good relationships with a small number of approved dealers than to have a long list of firms who transact little or no business with the investing entity. 3. Due diligence on broker/dealers should include obtaining information on: • a security dealer's experience and knowledge of public funds investing; • all contact information for the primary contact,backup and operations staff; • a broker's manager and supervisor; • the financial strength of the firm; • areas of expertise and trading activity; • registration with FINRA and any citations; • the names and contact information for references similar to the entity;and • potential conflicts of interest. 4. Establish a competitive procedure for attaining reasonable market rates on investment transactions: • Require that all security sales be made through a competitive bid process.If possible,use a competitive offer process on purchases as well. • Securities sold through a selling group at a set price(usually par)or available for specific bidding should be compared to comparable maturity securities as part of the competitive process to determine the best relative value. 5. Require that all security transactions be settled on a delivery versus payment basis at the entity's custodian bank to perfect ownership under a written custodial agreement. 6. Retain complete transaction documentation for audit trail purposes including trade tickets, confirmations and safekeeping receipts. 7. Electronic trading platforms,such as Bloomberg and Tradeweb,are becoming another alternative to competitive pricing. These platforms can provide improved transparency over competitive bids and should be considered if cost effective for the government. It is still important to have a broker assigned to the account on the electronic platforms so that contact can be made if necessary. The same due diligence should be completed with all broker dealers on the electronic platforms. 8. Follow all state and entity ethics policies when dealing with all broker/dealers and investment vendors. References: • Introduction to Broker-Dealers for State and Local Governments,Second Edition,Sofia Anastopoulos,GFOA,2008. • Investing Public Funds,Second Edition,Girard Miller with M. Corinne Larson and W.Paul Zorn, GFOA, 1998. • Federal Reserve Bank of New York,www.frb.ny.gov,http://www.newyorkfed.org/markets/pridealers_listing.html. • WWW.FINRA.GOV;http://www.nasd.com/web/idcplg?IdcService=SS_GET_PAGE&nodeld=37 0. • Securities and Exchange Commission,www.sec.gov,VI.Financial Responsibility of Broker Dealers,A.Net Capital Rule 15c3-1 (17 CFR 240.15c3- 1)http://www.sec.gov/divisions/marketreg/bdguide.htm#VI. 32 Government Finance Officers Association Recommended Practice Establishing a Policy for Repurchase Agreements Where permitted by statute and investment policy,governmental entities often enter into Repurchase Agreements(repos)to invest funds on a short-term basis primarily to fund liquidity needs.Repos are contractual financial transactions in which an investor(e.g.governmental entity)purchases securities from a bank or dealer with a simultaneous contractual agreement by both parties to reverse the transaction at the same price(plus interest)at some mutually agreed-upon future date.The parties to the agreement (governmental entity and bank/dealer)are commonly referred to as counterparties.Repos are an integral part of an investment program of state and local governments and provide an alternative or supplement to local government investment pools,money market mutual funds and other money market instruments. However,like all investments,there are associated risks with repos,one in particular is the counterparty's credit risk. Such risk can be mitigated by the utilizing proper securitization practices. Common Types of Repos: • Overnight Repo: refers to a repo that goes from one business day to the next business day.These repos have a negotiated fixed interest rate. • Term Repo:refers to a repo agreement with a specified maturity of several days to several weeks. Term repos can be established for up to several years when the investment policy permits.The interest rate for the period is usually fixed. • Open Repo:typically,has no maturity date,and renews daily until terminated by either one of the counterparties.The interest rate adjusts daily to the overnight rate and is averaged for the period of the repo. • Flex Repo(flexible repurchase agreements):are often used for the reinvestment of bond proceeds used for capital projects.These repos are often for multi-year periods associated with a specific capital program.The flexible portion of the agreement permits multiple cash drawdowns to fund the expenditure requirement.Governments should ensure that these investments meet the liquidity requirements of the project and adhere to any bond covenants. • Tri-Party Repo: occurs when a custodian(a.k.a.the tri-party agent)participates as an intermediary between the two parties(investor and lender)of the repo.The custodian administers and ensures the transaction occurs simultaneously and that necessary safeguards are in place to protect the underlying securities during term of the repo. Benefits of Repos: • Repos are safe when properly established and monitored; • At times,provide higher yields than other money market alternatives; • Provide diversification to other money market investments;and • Provides flexibility. Risks Associated with Repos: • The repurchase agreement with an entity's counterparty is not properly established; • The financial strength of the counterparties and value of the collateral are not properly monitored; • The bank or dealer cannot buy securities back when repo is closed by governmental entity. • The collateral for the repo is not liquid or easily marketable;and • The value of the repo is not sufficient to cover the funds invested and interest earned. 33 Mitigating the Risk: • Execute a SIFMA Master Repurchase Agreement including additional provisions specific to the governmental agency that is signed by a duly authorized officer with each counterparty; • Establish financial strength criteria for counterparties and review financial statements at inception of relationship and at least annually. Some entities will limit counterparties to primary dealers; • Allow only highly marketable,easily priced collateral priced at a minimum of 102%and monitoring their value at least weekly;and • Have collateral settled delivery-versus-payment(DVP)at the entity's custodian or trustee for third- party safekeeping. Master Repurchase Agreement.A Master Repurchase Agreement is the contractual agreement a governmental entity enters into with a bank or counterparty.A form of the agreement,also known as a blanket agreement may be obtained from the website of the Securities Industry and Financial Markets Association(SIFMA)formerly known as The Bond Market Association(TBMA).However,governmental entities may wish to amend SIFMA's form of the Master Repurchase Agreement to suit the specificities of their respective transactions. A master repurchase agreement governs the repurchase transaction.An agreement should reflect the following characteristics: • Defines and provides detail as to the nature of the transaction; • Identifies the relationship of the parties to the agreement; • Establishes the parameters concerning the ownership and custody of the collateral securities for the term of the agreement; • May include right to substitute collateral during the term of the agreement;and • Provides for remedies in the event of default by either party. SIFMA has also published an optional substitution/termination provision to its Master Repurchase Agreement that allows the repo seller(bank or dealer)to retain effective control over the purchased securities,or the repo seller could elect to terminate the transaction prior to maturity on short notice to the repo buyer(government entity). Securitization Provisions. Safekeeping:In order to protect public funds,governmental entities should ensure proper securitization practices when utilizing repurchase agreements for investments. Safekeeping should be performed by an independent or third-party custodian.Duties of the custodian(direct or tri-party)should be outlined in a written safekeeping agreement. Collateral:The underlying security of a repurchase agreement is collateral. Collateral arrangements for repurchase agreements are short-term and liquid in nature.Typical collateral instruments are U.S. Treasuries(e.g.U.S.Treasury bills)and governmental agency securities(e.g.Farm Credit Banks,Home Loan Banks bonds).Governmental entities should be aware of the risk factors of the underlying collateral instrument for the repo and refer to their respective investment policies to verify if such collateral instruments are permissible to utilize for the repurchase transaction.The purchased securities(collateral)to collateralize the repurchase agreement should maintain a market value in excess of the value of the repurchase agreement(called margin,"haircut,"or over securitization). Although governmental entities are not bound by the Financial Accounting Standards Board(FASB), FASB Statement No.140 affects the counterparties to repurchase transactions with governments.FASB Statement No. 140,"Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities,"generally provides that if the repo buyer(i.e.,government entity)has the right to sell or 34 substitute the securities,then the repo seller(i.e.,bank or dealer)does not have the right to substitute the securities or terminate the contract on short notice.The repo buyer will be obligated to record both the securities,together with any obligation to return the securities.The repo seller will be required to reclassify the securities from a securities inventory or investment account to a securities collateral account on its balance sheet.Accordingly,the nature of the underlying repurchase agreement may change from a buy-sell transaction to a collateralized loan.This change of treating repurchase agreements as collateralized loans would make them illegal for local governments in many states. GFOA recommends that state and local government fmance officers develop policies and procedures to ensure the safety of repos. The following actions are recommended: 1. Government entities and investment officers should exercise special caution in selecting and evaluating the creditworthiness of counterparties with whom they will conduct repurchase transactions and be able to identify the parties acting as principals to the transaction. 2. Master repurchase agreements should be employed, subject to appropriate legal and technical review.Governments using the prototype agreement developed by SIFMA should include appropriate supplemental provisions regarding the types of securities,delivery,substitution, margin maintenance,margin amounts,seller representations,and governing law as contained in the GFOA-developed Considerations for Governments in Developing a Master Repurchase Agreement. 3. Government entities'legal department should review SIFMA's optional substitution/termination provision in its master agreement to assure no loss has incurred(e.g. in event of a default).In jurisdictions where substitution of securities is permitted,a loss provision is provided that is intended to place the repo buyer in the same position it would have been had the repo seller not exercised the substitution/termination right.However,in jurisdictions where substitution is restricted,the effect of FASB Statement No.140 may be troublesome depending on the relationship established with the bank or dealer;the jurisdiction's position with respect to the change in accounting treatment of the transaction;and whether the government has the ability to avoid the restriction on substitution of purchased securities. 4. Proper securitization practices are necessary to protect the public funds invested in repurchase agreements. Safekeeping duties should be performed by a third-party custodian in accordance with an executed agreement.The purchased securities(collateral)to collateralize the repurchase agreement should maintain a market value in excess of the value of the repurchase agreement (called margin,"haircut,"or over securitization).Routine market valuing of the purchased securities during the term of the repurchase agreement should be a mandatory practice in order to ensure the purchased securities maintain sufficient market value to cover any default.A typical margin requirement for a short-term repo using US Treasuries or US agency securities as collateral is at least 102%and higher(typically 105%)for other securities. 5. Consideration should be given to restricting the allowable securities that are used for collateral. Entities may prefer to only allow for security maturity and security types that are allowable for direct investment under their policy.If there is a default of the counterparty,the securities held as collateral of the repo will be owned by the entity,supporting the need to restrict the maturity and type of security to what is allowable under policy. 35 Government Finance Officers Association Recommended Practice Monitoring the Value of Securities in Repurchase Agreements A repurchase agreement(repo)is a transaction between a buyer/investor(e.g.government entity)and a seller/counterparty(e.g.bank or securities dealer)in which the counterparty sells securities to the investor with a simultaneous agreement to buy the securities back from the investor on a future date.The securities are repurchased,or bought back,at the same price plus the interest earned at the repo rate for the period of the repo.U.S.Treasury Securities(Bills,Notes,Bonds)and Government Sponsored Enterprise(GSE)(e.g. Fannie Mae,Freddie Mac)securities are the most common securities sold for repos involving government entities.Terms for repos can be overnight(from one business day to the next business day),for a specified number of days(term repo)or as a continuing open contract(open repo)to be closed at the request of either ply Public funds have used repos since the 1970s.In September 1996,the Securities Industry and Financial Markets Association(SIFMA)formerly,The Bond Market Association,published a revised version of its Master Repurchase Agreement,which previously had been amended in 1987.The revised agreement includes modifications designed to reflect the expansion of the repo market,changes in the law and "'market participants'experience in exercising liquidation and similar closeout rights in the context of counterparty insolvency." (SIFMA Guidance Notes and Supplemental Guidance Notes). In March of 2003,the Governmental Accounting Standards Board(GASB)published Statement No. 40,Deposit and Investment Risk Disclosures,an amendment to GASB Statement No.3,Deposits with Financial Institutions, Investments(including Repurchase Agreements),and Reverse Repurchase Agreements which states that government entities should briefly describe policies regarding securitization and safekeeping for deposits and investments,including repos,that are related to the risks that must be disclosed under this Statement No.40. An important factor in managing the risk of default in repurchase transactions is the valuation of the purchased securities.For the term of the repo agreement,it is common practice for the counterparty to deliver purchased securities to the investor in a total value amount(market value plus accrued interest)that is equal to the investor's investment plus a margin percentage. The margin percentage,typically 102%for Treasury and GSE securities,protects the investor from a decline in the price of the purchased securities during the time the repo transaction is in effect.The value of the securities must be monitored frequently to ensure the market value remains at least equal to the invested amount plus margin percentage in case of default of the counterparty.If the value of the purchased securities falls below the invested amount plus margin percentage,then the counterparty is required to deliver additional securities to the investor upon their request. The frequency of the valuation depends on several factors: • The maturity of the purchased securities,since longer maturities have greater price volatility; • The security types,since certain securities have greater price volatility; • Market volatility; and, • The margin percentage that is required by the investor;the lower the margin percentage,the more frequent the valuation of the purchased securities. Because the investor may need to liquidate the purchased securities in the secondary market in the event the counterparty defaults on the repurchase agreement transaction,GFOA recommends that government entities establish a policy and procedure for monitoring the value of the purchased securities in a repo transaction to insure that it does not drop below the value of the repo investment plus any required margin percentage.For maximum protection,government entities should value the purchased securities in their repo transactions to their current market price on a daily basis.At a minimum,the purchased securities should be valued: 36 • Weekly; • Whenever there is a major increase in rates or market volatility is high;or, • Whenever a coupon and/or principal payment on the purchased securities is wired back to the counterparty. In order to facilitate the determination of market value,government entities should specify the acceptable securities for a repo transaction.Acceptable securities are those that have readily available pricing information from a reputable,independent pricing source.The independent source of pricing should not be a counterparty to the repo transaction and could include: • a broker or other financial institution that was not a counterparty to the transaction, • the custodial bank if the bank was not a counterparty to the transaction, • publicly available publications such as the Wall Street Journal,or • other pricing services for which a separate fee would be paid. When valuing securities,the purchased securities are valued using their current market price plus accrued interest to compute their total value.The total value is then compared to the repo value multiplied by any margin percentage.If the total value of the purchased securities is less than the repo value plus the margin percentage,then the investor/buyer should request sufficient additional securities on a same-day or next- day basis from the counterparty to bring the total value up to the proper level. Further discussion of repos and recommended safeguards is provided in the references listed below.Public investors should consult their investment policy as well as state law and local ordinances for any further restrictions or guidance on repurchase agreements and valuation of purchased securities. References: • GFOA Best Practice,"Establishing a Policy for Repurchase Agreements,"(2003,2006,2008 and 2010),GFOA Committee on Treasury and Investment Management • GFOA Advisory,"Ensuring the Safety of Reverse Repurchase Agreements," (2003,2006,2008 and 2010),GFOA Committee on Treasury and Investment Management • "Do You Know Your Repurchase Agreements as Well as You Think?"GFOA's Treasury Management Newsletter,October 3,2009,Volume 27,Number 10. • Introduction to Broker-Dealers for State and Local Governments, Second Edition,Sofia Anastopoulos,GFOA,2008. • An Introduction to Collateralizing Public Deposits for State and Local Governments,Second Edition,M.Corinne Larson,GFOA,2006. • Considerations for Governments in Developing a Master Repurchase Agreement, Second Edition, GFOA Committee on Cash Management,2001. • Investing Public Funds,Second Edition, Girard Miller with M.Corinne Larson and W.Paul Zorn, GFOA, 1998. • Master Repurchase Agreement,September 1996 The Securities Industry and Financial Markets Association(SIFMA),http://www.sifma.org • Governmental Accounting Standards Board(GASB),http://www.gasb.org 37 Government Finance Officers Association Recommended Practice Collateralizing Public Deposits Depending on applicable state or federal law,public unit deposits may be secured by collateral or assets of a bank or fmancial institution. In the event of the failure of the bank,the FDIC will honor the collateralization agreement if the agreement is valid and enforceable under applicable law. The FDIC does not guarantee,however,that the collateral will be sufficient to cover the amount of uninsured funds.As such,although it does not increase the Insurance coverage of the public unit deposits,collateralization provides an avenue of recovery in the unlikely event of the failure of an insured bank. FDIC insurance covers deposits up to$250,000 for each entity. Deposits above this FDIC limit must be collateralized to ensure the safety of public funds. Collateralization of public deposits through the pledging of appropriate securities or other instruments(i.e. surety bonds or letters of credit)by depositories is an important safeguard for such deposits.The amount of pledged collateral is determined by a governmental entity's deposit level and the policy or legally required collateral margin. Some states have established programs for the pooling of collateral for deposit of public funds. All collateralization agreements between financial institutions and public entities must adhere to state and federal laws,including FDIC regulations. GFOA recommends the use of a written agreement with pledging requirements as protection for state or local government's deposits.GFOA further recommends that governmental entities establish adequate and efficient administrative systems to monitor such pledged collateral,including state or locally administered collateral pledging or collateral pools.To accomplish these goals,GFOA recommends the following: 1. Governmental entities should review applicable federal,state statutes and confirm compliance. The governmental entity should establish and follow procedures for on-going review of collateral. In addition,a periodic report of collateral holdings and compliance with state statute and local policy should be provided to the governing body or investment committee(or other committees as applicable). 2. In the absence of a state program for pooling collateral,public entities should establish and implement collateralization procedures,including procedures to monitor their collateral positions. Monitoring informs a public entity of under collateralization,which may threaten the safety of an entity's deposits,and overcollateralization,which may increase the cost of banking services. Governmental entities,however,should not accept the liability for maintaining collateral levels which is the responsibility of the financial institution. 3. Governmental entities/depositors should take all possible actions to ensure that their security interests in collateral pledged to secure deposits are enforceable against the receiver of a failed financial institution. 4. Governmental entities should have all pledged collateral held at an independent third-party institution(custodian)outside the holding company of their bank and evidenced by a written agreement between the custodian and the government. Governmental entities should know and understand securities pledged as collateral. 5. Governments should seek a margin level of at least 100%,or as dictated by state statute. The government should also indicate its desired margin level in its investment policy.The value of the pledged collateral should be marked to market and reported monthly,or more frequently depending on the volatility of the collateral pledged. Some state statutes dictate a minimum margin level for collateral based on deposit levels. 6. Margin levels and bank balances should be monitored daily as there may be a large influx of deposits for a short amount of time(e.g.,semi-annual/annual tax payments within the span of a day or two). 38 7. Substitutions of collateral should meet the requirements of the collateral agreement,be approved by the governmental entity in writing prior to release,and the collateral should not be released until the replacement collateral has been received. 8. The public entity should require,at a minimum,monthly reporting directly from the custodian. The custodian should warrant and be signatory to the agreement. 9. Letters of credit may be pledged in lieu of securities. The governmental entity should perform a legal review of the terms and conditions of any letters of credit. Such letters of credit must be issued by a federal agency or government sponsored enterprise(e.g.,Federal Home Loan Bank, etc.)and be irrevocable. 39 Government Finance Officers Association Recommended Practice Selection and Review of Investment Advisors Many governments engage investment advisers for assistance in managing their non-pension fund investment portfolios. State and local government treasury and investment managers augment their investment programs by retaining investment advisers to perform various portfolio services,ranging from advice-only consultation to full discretionary management.In engaging an investment adviser,a government may benefit from professional portfolio management,risk management,potential audit savings,and continuity in the investment function,among other benefits.Most of these engagements have been positive.However,there have been some instances of inappropriate investment activities.The problems and reported losses have often resulted from governments hiring an adviser before they have clearly defined their needs,performed sufficient due diligence,and established proper controls and ongoing oversight. It is important for governments to take a careful and informed approach in the selection and use of investment advisers.When hiring an investment adviser,the government must determine the level of authority to grant the adviser.Advisory services will differ in the level of authority the government grants the adviser and the corresponding level of involvement the government retains in the investment process. Under a non-discretionary agreement,the adviser must obtain approval before executing any trade.All activity must comply with the guidelines of a government's investment policy,investment objectives, governing laws,and written or oral instructions.With a non-discretionary agreement,the government is directly involved in investment transactions,whether to establish a comfort level with external management or the adviser,to learn from the adviser,or for some other reason. Under a discretionary agreement,the adviser can execute trades for the government without prior approval on each transaction.The adviser follows the same guidelines and restrictions as a non-discretionary adviser. With a discretionary agreement the government is less involved in the investment transactions,thus enabling staff resources to be directed to other duties,giving the adviser the ability to execute investment strategies more quickly,and allowing the government to hold the adviser totally responsible for the performance in the portfolio. Under either agreement type,the government maintains control of its investment program by establishing the guidelines and policies to which the adviser must adhere. GFOA recommends that state and local governments exercise caution and prudence in their selection of investment advisers.Because fiduciary responsibility for the safety and liquidity of government funds cannot be delegated to an investment adviser,the implementation of a safe and effective investment program must be carefully coordinated with the adviser. The GFOA urges state and local governments that are considering retaining an investment adviser to define and control the procurement process and assure periodic reviews of investment advisory services.Adhering to defined due diligence in selecting a qualified investment adviser and establishing proper controls will help a government achieve its objectives for hiring an adviser while protecting its funds and reducing risk to its reputation. Within the scope of Securities and Exchange Commission(SEC)regulations,state and local laws,and any other requirements,relationships with investment advisers should address the following: • Identification of adviser responsibilities.Responsibilities of the investment adviser should be identified before the selection process.During the process these should be clearly defined and communicated. 40 • Impartial procurement.The responsible government official or the governing board should appoint a consultant and/or internal review committee to conduct the search process. Such staff, consultant,and/or review committee members should be independent of any interest in or relationship with any investment advisory firm.The procurement process should be competitive and merit based. • On-going review.Investment advisory services should be reviewed on an on-going basis.The on- going review,monitoring and evaluation of the investment adviser are as important as the due diligence undertaken during the initial selection process.The responsible government official or the governing board and/or review committee should determine the scope and frequency of such review process. Criteria-The responsible government official or the governing board and/or review committee should determine the criteria to be used in the selection process.Identifying relevant criteria upfront promotes transparency in the selection process.Assigning weightings to these criteria can create a workable method to rank or quantify the importance of each. Criteria should include: • the investment adviser's understanding of the government's investment program,objectives and constraints • the investment adviser's background,including the experience,resources,and qualifications of the firm in general,that of the individuals assigned to handle the government's account,and the firm's experience in managing state and local government operating funds • the investment adviser's recommended approach to management of the portfolio: Is this approach • appropriate for the government? • fees and fee basis Risk Control-As part of the procurement process and prior to a final decision on the investment adviser, the government entity should have made decisions regarding its risk tolerance and developed corresponding risk control requirements,including: • the level of discretion afforded the investment adviser • prohibitions against self-dealing for trade execution • competitive trade execution • trade confirmations • delivery versus payment trade settlement • independent third-party custody of securities(no investment adviser custody) • timely reconciliations of trade confirmations and custodial statements • monthly reporting that complies with industry standards and local requirements • ongoing compliance reviews • allowance for independent audits Selection Process-Once the government defines the services it seeks to obtain and the criteria it will use to make its selection,a Request for Proposal(RFP)is useful to gather information for the decision-making process. Information that might be part of the RFP include: • SEC licenses • quantitative information(e.g.,fmancial stability and performance review) • organizational structure of firm including any business affiliations • experience and depth of personnel in firm,including turnover and single versus team management • reporting standards(Global Investment Performance Standards or GIPS) • firm-specific investment philosophy and portfolio management strategies • trading process 41 • interviews with fmalists • understanding of current or historic regulatory censure or litigation The sources for potential candidates may include: • references from other governments • consultants'database(s)on investment advisory firms • association databases • industry reports and articles • marketing materials Final decisions will require an objective compilation and analysis of the results of the RFP.Most importantly,the investment adviser and the services offered must match the needs of the particular government entity. Advisory Agreement-A well-constructed agreement containing specific instructions concerning objectives and risk parameters,allowable investment instruments and strategies,and required reporting procedures is critical to a successful outcome.After a recommendation regarding the selection of an investment adviser has been made,the contractual agreement should include: • scope of services • appointment of the investment adviser and fiduciary responsibilities • establishment of account responsibilities • definition of accounts and custody • defmition of discretionary or non-discretionary services with appropriate limitations • defmition of standards(Prudent Expert) • establishment of objectives,restrictions and benchmarks • defmition and processing of transaction procedures in accordance with policy including brokerage limitations • representations by entity and investment adviser • determination of reasonable liability insurance for errors and omissions • establishment of invoicing and payment • procedure for termination by either party • specifications related to nondiscrimination in contracting and ethics rules • certification of the government's policy by the investment adviser • all provisions of the RFP as part of the contract References: • Investing Public Funds,Second Edition,Girard Miller with M.Corrine Larson and W.Paul Zorn, GFOA, 1998. • An Introduction to Investment Advisers for State and Local Governments,Sofia Anastopoulos, GFOA 2007.This publication includes a sample Request for Proposal(RFP)for investment advisory services and a sample investment advisory agreement. • An Elected Official's Guide:Investing,second edition,Sofia Anastopoulos,GFOA,2007. • GFOA Sample Request for Proposal for Investment Advisory Services,GFOA,2007. 42 Government Finance Officers Association Recommended Practice Use of Derivatives and Structured Investments by State and Local Governments for Non- Pension Fund Investment Portfolios GFOA Advisories identify specific policies and procedures necessary to minimize a government's exposure to potential loss in connection with its financial management activities.It is not to be interpreted as GFOA sanctioning the underlying activity that gives rise to the exposure. A derivative product is a financial instrument created from,or the value of which depends on(is derived from),the value of one or more underlying assets or indices of asset values.Derivatives may include forwards,futures,options,swaps(currency and interest rate),caps,floors,collars and rate locks. Structured investments are fmancial instruments that are created(structured)through pooling or redistributing assets,tranching liabilities(backed by pools of assets)and/or separating the credit risk of the collateral assets from the originating entity.Examples of such instruments commonly used by governmental entities may include asset backed securities,mortgage backed securities,various collateralized obligations and credit derivatives among others. GFOA advises state and local government fmance officers to exercise extreme caution in the use of derivatives and structured fmance products.Governmental entities must learn about and understand the potential risks and rewards of derivative and structured products,before deciding if they should be used. Governments must understand fully the characteristics of these instruments and have the ability(internal staff and expertise)to determine the fair market price and be aware of the legal,accounting,credit and disclosure risks involved. Governments should consider the following factors in determining whether to use derivatives and structured investment products: 1. Legality.Governmental entities should understand that state and local laws may not specifically address use of these products.Factors to consider include: • the constitutional and statutory authority of the governmental entity to execute derivative contracts or to buy structured fmance products, • the potential for violating constitutional or statutory provisions limiting the governmental entity's authority to incur debt resulting from the transaction,and • the application of the governmental entity's procurement statutes specifically to derivative transactions. 2.Appropriateness.Governmental entities must observe the objectives of principal preservation,liquidity, and return within legally allowable investments.Judicious asset and liability management policies help achieve these objectives while managing risk.Characteristics of some derivatives and structured investment products that may preclude their use and make them inappropriate include high price volatility,illiquid markets,valuation difficulties,insufficient market history,high degree of leverage,keen monitoring and modeling system requirements,and the need for a high degree of sophistication to manage risk. Governmental entities should be aware of all the risks associated with the use of derivatives and structured investment products,including credit,counterparty,market,prepayment,liquidity,settlement,custodial and operating risk. Regarding the difficulty in valuing derivatives and structured investment products,governmental entities should understand that there may be little or no pricing information or standardization for some derivatives and structured investment products.Competitive price comparisons are recommended before entering into a transaction.Even in cases of competitive pricing,because valuations of such products are based on highly 43 sensitive models and not on actual markets,changes in the underlying assumptions may severely impact asset values. In addition to determining legality and appropriateness,governmental entities should analyze the materiality of a transaction to determine if it might affect a bond or other credit-related rating of such entity.Rating agencies should be notified if required. 3.Procedures and Internal Controls.Governmental entities should establish internal controls for use of derivatives and structured investment products to ensure that risks involved with these are adequately managed. Such procedures should include: • Creating an oversight board and establishing upfront criteria for use of derivatives and/or structured securities; • Comprehensive derivatives and structured securities policy(evidencing legal authority,listing authorized and prohibited types of derivatives and structured investments,identifying guidelines for counterparty selection,limiting maximum permissible amounts and specifying means of determining such maximums); • Review with ratings agency(ies)impact of derivatives use on governmental entity; • Written statement of purpose and objectives for derivative use, • Written procedures for monitoring of derivative instruments and structured investment products, including how often they will be priced and what pricing services will be used: • Periodic training for managers and access to technical resources to oversee derivative and structured investments: • Sufficiently detailed recordkeeping to allow governing bodies,auditors,and examiners to determine if the program is functioning in accordance with established objectives.Managers should report regularly on the use of derivatives to their governing body and appropriate disclosure should be made in official statements and other disclosure documents: • Reporting on derivative use in accordance with generally accepted accounting principles.Because of the complexity of these instruments,governments should consult with public accountants at an early point to determine if specialized reporting may be required: • Required documentation of stress testing and scenario analysis of derivatives and structured investment products.Every possible effort should be made to determine worst case scenarios when using derivatives or structured products,as well as likelihood or probability of these outcomes and the government's ability to weather them;and • Procedures for evaluation and review on a periodic basis. 4.Role of External Parties.Governmental entities should know if their broker-dealers are merely acting as an intermediaries or are taking a proprietary positions in derivatives or structured investment product transactions.Possible conflicts of interest should be taken into consideration before entering into a transaction. Governmental entities should exercise caution in the selection of broker-dealers or investment advisers. They should confirm that these vendors are knowledgeable about,understand and provide disclosure regarding the use of derivatives and structured investment products,including benefits and risks. Governmental entities are responsible for ensuring appropriate safeguards are in place when derivative or structured investment product transactions are conducted by a third party acting on behalf of the governmental entities. The GFOA reiterates the need for governments to exercise extreme caution when considering derivative products for their investment portfolio.It is important to emphasize that these instruments should not be used for speculation. 44 Governmental entities must learn about and understand the risks and rewards of derivative and structured investment products in order to properly evaluate and manage. Governmental entities should consider the use of derivatives and structured investment products only when they have attained a sufficient understanding of the products and the expertise to manage them.Certain derivative products and structured investment products may not be appropriate for all governmental entities. Ultimately,it is the responsibility of each governmental entity to determine what constitutes a derivative and/or a structured investment,and what is allowable by statute and policy. References: • A Public Investor's Guide to Money Market Instruments, Second Edition,edited by M.Corinne Larson,GFOA, 1994. • GFOA Best Practice:Use of Debt-Related Derivatives and Development of Derivatives Policy, 2010,GFOA's Committee on Governmental Debt Management. • GFOA Derivatives Checklist,2010,GFOA's Committee on Governmental Debt Management. 45 Government Finance Officers Association Recommended Practice Mark-to-Market Reporting for Public Investment Portfolios GFOA recommends that state and local government officials responsible for investment portfolio reporting determine the market value of all securities in the portfolio on at least a quarterly basis. These values should be obtained from a reputable and independent source and disclosed to the governing body or other oversight body at least quarterly in a written report. Market risk is significant in public investment portfolios.Due to price volatility,valuing investments at their current price is necessary to provide a realistic measure of a portfolio's true liquidation value.Over time,reporting standards for state and local government investment portfolios have been enhanced so that investors,governing bodies,and the public remain informed of the current market value of the portfolio. Regular disclosure of the value of a governmental entity's investments is an important step to furthering taxpayer and market confidence in state and local government investment practices.The Governmental Accounting Standards Board(GASB)has also recognized the need to report investments at fair value at fiscal year-end.Government officials should be aware of state,local,accounting,and rating agency requirements regarding mark-to-market practices. GFOA recommends that state and local government officials responsible for investment portfolio reporting determine the market value of all securities in the portfolio on at least a quarterly basis. These values should be obtained from a reputable and independent source and disclosed to the governing body or other oversight body at least quarterly in a written report.The independent source of pricing should not be one of the parties to the transaction being valued and could include: 1. a broker or other fmancial institution who was not a counterparty to the transaction, 2. the custodial bank if the bank was not a counterparty to the transaction, 3. publicly available publications such as the Wall Street Journal,or 4. other pricing services for which a separate fee would be paid. It is recommended that the written report include the market value,book value,and unrealized gain or loss of the securities in the portfolio. If there is a significant event in the local or national economy that might affect the value of the portfolio, then a mid-term valuation of the portfolio should be conducted.Governments that employ a more active portfolio management style should consider more frequent marking to market and reporting. References: • GASB Statement 31 and Implementation Guide,Accounting and Financial Reporting for Certain Investment and for External Investment Pools,March, 1997. • Investing Public Funds,Second Edition,Girard Miller with M.Corinne Larson and W.Paul Zorn, GFOA, 1998. • Investment Procedures and Internal Controls Guideline,GFOA,May 2003. • Elected Official's Guide Investing, Second Edition,Sofia Anastopoulos,GFOA,2007. 46 Government Finance Officers Association Recommended Practice Securities Lending Programs for Non-Pension Fund Portfolios GFOA Advisories identify specific policies and procedures necessary to minimize a government's exposure to potential loss in connection with its financial management activities.It is not to be interpreted as GFOA sanctioning the underlying activity that gives rise to the exposure. Only governmental entities that have the necessary expertise and resources should engage in securities lending programs. Where permitted by state statutes,governmental entities participate in securities lending programs as a way of earning incremental investment income on non-pension fund assets.In securities lending programs,a governmental entity(directly as principal or through an intermediary)lends securities such as U.S. Treasury,agency,or government sponsored enterprise(GSE)securities,from its investment portfolio in return for cash or non-cash collateral.If the collateral is cash it is then reinvested.The participants include the governmental entity,the borrower and the contracted lending agent,if lending is performed through an intermediary. There are several counterparties to this type of transaction(govt entity,lending party,tri party,etc.).A securities lending transaction has many of the same characteristics as a reverse repurchase transaction.In both,securities are lent to a counter party with the governmental entity receiving collateral to be reinvested. A major difference is that securities lending programs through an intermediary are contractual and ongoing whereas reverse repurchase transactions are typically one-time or non-recurring. Broker-dealers typically are the borrowers in securities lending programs.They use the borrowed securities primarily to cover fails(the non-delivery of securities expected to be delivered on a date certain)and short sales(the sale of securities not presently owned by the seller in order to take advantage of an expected lower market price)and to execute arbitrage transactions.Accordingly,securities lending programs play an important role in maintaining orderly markets. The securities loaned are collateralized for the term of the loan and marked-to-market daily.Minimum collateral is usually set at 102%or more.This margin reduces the lender's exposure to the borrower.The governmental entity retains ownership of the securities including the coupons paid during the period the securities are loaned. Cash collateral usually has a borrowing rate less than the overnight money market funds rate.The difference between the borrowing rate and the reinvestment rate produces a net gain in interest income and determines the value of the trade.The resulting income is subsequently split between the participants in the securities lending program.There are many options on reinvestment of cash collateral which should be carefully reviewed and adopted by the government. Because securities lending programs are not primary activities for most governmental entities and market access may be limited,they may contract with a lending agent.l Typically,a master trust,custodial or safekeeping bank or asset manager will act as lending agent facilitating the securities lending programs. Typical Steps The typical steps in establishing and operating a securities lending program are: 1. Governmental entity solicits proposals for lending agent to establish contractual limits and requirements(collateral requirements,authorized collateral,fees). 2. Governmental entity designates portion of the portfolio to be lent through lending agent. 3. Lending agent presents portfolio to broker-dealers as available for lending. 4. Designated securities are lent through agent to approved borrower. 47 5. Collateral(for securities loan)is delivered at predetermined level to approved custodian. 6. Simultaneous to receipt of the collateral,securities are delivered to the borrower. 7. Cash collateral is reinvested in a segregated liquid transaction until the security is returned.In the case of cash collateral,the lending agent negotiates the interest rate on the collateral paid to the borrower of the securities,which is called the rebate rate.In the case of non-cash or securities collateral,the lending agent negotiates a fee paid by the borrower.The governmental entity should specify reinvestment options. 8. At the end of the loan term,borrower returns securities to governmental entity via lending agent and simultaneously the lending agent returns collateral to borrower. 9. The difference between what is earned on the cash collateral investment and the rebate rate is the gross spread.The lending agent retains a portion of the gross spread as its fee and credits the remainder to the owner of the securities as negotiated between the governmental entity as the lender and the lending agent.Payment is normally made monthly. 10. The governmental entity keeps the remaining reinvestment income. 11. The value of the collateral is marked to market daily to ensure full collateralization. 12. At the end,borrower returns securities to governmental entity via lending agent and simultaneously the lending agent returns collateral to borrower. Risks While securities lending programs historically have been considered relatively low risk,there are risks and some governmental entities have suffered significant securities lending losses.Most of these losses were related to either default risk or maturity risk,which are discussed in more detail below. Securities Lending Risks • Borrower Risk.The risk that the borrower will not be able to return the borrowed funds at the end of the loan term.Borrowers must have high credit ratings from-the rating agencies,and,more importantly,must meet certain other fmancial criteria as specified by the lending agent and the governmental entity in the securities lending agreement.A second aspect of counterparty risk is that the borrower fails to provide additional collateral as required • Concentration Risk.The lack of diversification by borrower amplifies borrower risk. • Collateral Risk.The lender(governmental entity)does not receive sufficient or authorized collateral to cover the market value of borrowed securities. Reinvestment Risk • Credit/Default Risk.The risk that the collateral investment made by the securities lending agent either defaults or suffers a ratings downgrade putting it out of compliance with a governmental entity's policies or results in a reduced market value or a loss to the entity. • Interest Rate Risk.The risk that the yield on the invested collateral is less than the rebate paid to the borrower. (The lending agent must verify the daily spread before any lending is committed.) • Maturity Risk.The risk that the maturity of the collateral re-investment exceeds the maturity of the loan. Inaccessibility to the cash would require the governmental entity to provide other funds not necessarily available. Operational Risks These risks generally involve problems with contractual or administrative issues of the program. Clear guidelines and requirements must be set.These may include problems with margin maintenance, settlement,corporate actions,dividends or interest,marking to market,monitoring,billings and reporting. Typically,a lending agreement provides that borrower's credit risk,broker-dealer default risk,and collateral maintenance are risks undertaken by the lending agent.However,indemnification provisions vary.The governmental entity,as lender,can demand fmal approval of acceptable counter-parties and the 48 assets available for lending.These decisions generally affect the split of the investment proceeds.Risks typically borne by the governmental entity involve reinvestment risk. Liquidity requirements are often accepted and guaranteed by the lending agent upon one day's notice,as substitution by the borrower in large lending programs is easily accomplished and essentially risk-less. Normally,the governmental entity provides one day's notice if it wishes to sell a security that is on loan. Programs that require the governmental entity to undertake responsibility for managing the liquidity present greater risks and require that the governmental entity place limits on the amount of the portfolio which may be put on loan.The conditions for the term of the securities on loan and the reinvestment of the proceeds must be carefully established by contract and strictly managed. While investment strategies that include securities lending programs are not inherently risky when employed judiciously with appropriate precautions and controls,GFOA urges state and local government officials to exercise caution in their use of securities lending programs. Only governmental entities that have the necessary expertise and resources should engage in securities lending programs.Prior to participating in a securities lending program,government finance officers should: • Determine whether the entity's portfolio and ongoing strategy are appropriate to securities lending; • Determine whether securities lending is permissible under state statute and the governmental entity's written investment policy; • Prepare a written securities lending cash reinvestment policy,which may be attached to or incorporated into the entity's investment policy or exist as a stand-alone policy.The investment restrictions in this cash reinvestment policy should be consistent with the entity's own investment guidelines and strategy.Furthermore,the policy should include an explicit statement that the entity may set restrictions on the reinvestment of cash collateral as market conditions change. Such restrictions may include authorized commercial paper programs by program name,rating and/or term and asset-liability matching requirements.This policy should be incorporated into the contract with the securities lending agent. • Exercise special caution in selecting and evaluating the creditworthiness of lending agents and counterparties to the securities lending program • Consider the lending agent's experience,technological resources,assets,borrowers base,and fee basis • Establish a monitoring process for reviewing the lending agent's reports for compliance and performance,which should be done no less frequently than on a monthly basis • Ensure independence of the audit process. • Avoid possible counter-party risk by having all parties involved(government,lending agent,and custodian)sign a tri-party contract. • Require proper reporting procedures at all levels including: • Margin compliance • Counterparty participation • Payment information • Reinvestment detail • Consider the resources and required training of staff to adequately monitor compliance with the agreement by all parties. Notes: 1 This advisory discusses risks and practices associated with a third-party agent securities lending program, the most common type of securities lending program,versus a principal program. In a principal program,a single broker-dealer or bank enters into a contract with the governmental entity and usually quotes a guaranteed income stream to the entity or the governmental entity manages its own internal program which 49 requires considerable staff time and expertise.Principal programs thus provide the borrower with the exclusive right to borrow from a portfolio. References: • Investing Public Funds,Second Edition,Girard Miller with M. Corinne Larson and W.Paul Zom, GFOA, 1998. • GFOA Best Practice, "Presenting Securities Lending Transactions in Financial Statements," 1998. • GFOA Best Practice, "Repurchase Agreements&Reverse Repurchase Agreements,"2010 50 Government Finance Officers Association Recommended Practice Using Commercial Paper in Investment Portfolios GFOA Advisories identify specific policies and procedures necessary to minimize a government's exposure to potential loss in connection with its fmancial management activities.It is not to be interpreted as GFOA sanctioning the underlying activity that gives rise to the exposure. Commercial paper(CP)is a short-term,unsecured promissory note issued by corporations typically used as a source of working capital,receivables fmancing,and other short-term fmancing needs.CP has maturities ranging anywhere from 1 to 270 days.Because of the short maturity,federal law exempts CP from registration with the Securities and Exchange Commission. As an unsecured debt issued by companies,commercial paper carries default risk for investors as compared to U.S.Treasury or U.S.government agency or instrumentality debt. Originally the CP market was available as a funding source to only the highest credit quality entities. However,innovations such as liquidity programs,credit enhancements,and various special legal structures have made CP a viable financing alternative for entities with lower credit ratings.Accordingly,while investors traditionally relied on the financial strength of the issuing entity,increasingly investors must also evaluate the credit support backing an issue as well as the legal structure of the issuer. Different Structures of Commercial Paper In addition to traditional corporate issued commercial paper,there are other types of commercial paper as follows: Asset backed commercial paper-Asset backed commercial paper(ABCP)programs gained popularity partly as a response to the unsecured status of traditional commercial paper but also as a way for fmancial institutions to more efficiently finance their receivables through off-balance sheet vehicles.With ABCP, certain assets such as credit card receivables or auto loans and their cash flows,support a specific CP issue. ABCP is usually sold through a conduit,a special purpose vehicle(SPV)established to facilitate the fmancing.There are different structures for such conduits. Some SPVs pool the assets of many entities from various industries.These multiseller ABCP programs issue CP backed by the cash flows from all the underlying assets.The goal of such multiseller Programs is to enjoy the diversification from multiple sellers of various industries. Single seller ABCP programs are backed by the assets of one entity,for example a corporation.Consequently,they lack the diversification of multi-seller programs.Historically, such ABCP may have had higher credit ratings than the seller company itself.However,such homogenous assets may pose concentration risk. Most ABCP programs are partially supported programs,in which the program sponsor or guarantor may legally be obligated to cover only a certain percentage of defaults of the underlying assets or cover limited liquidity requirements related to delinquencies of these underlying assets.There are several programs still in existence that are fully supported,in which the program sponsor is obligated to reimburse CP investors regardless of delinquencies or defaults except in the case of a bankruptcy of the program. Structured investment vehicles(SIVs)-A relatively newer structure that issues CP is the structured investment vehicle(SIV).SIV programs have evolved away from the traditional funding purpose of CP. Some SIVs take advantage of spread differentials in fixed income securities,earning interest rate arbitrage profits. SIVs may invest in various asset categories,some of which are difficult to value because they do not trade on any active market.Lacking such a market,their value is based on models that are sensitive to a number of assumptions. 51 Liquidity Notes-In addition,other variations of CP have been introduced in the market in recent years, including extended liquidity notes(also called extendible or structured notes)in which the maturity of the notes may extend beyond their original maturity date in the case of a default. Other Features of Commercial Paper Nationally recognized statistical rating organizations(NRSROs)routinely rate commercial paper issues and regularly review the strength of the credit quality of the issue.In some instances,CP programs have been downgraded rapidly by the NRSROs. CP may be sold directly to investors by the issuing company(direct issued)or by the underwriting brokerage firm(dealer placed). Many governments invest in CP as a short-term investment for funds not immediately required,and to provide diversification and competitive rates of return.Typically,governments purchase CP with a buy and hold approach until maturity strategy.While a secondary market exists that can be utilized for sales prior to maturity,there have been periods of disruption due to either issuer-specific events or as a result of a broader market wide disruption.Changes affecting individual issues as well as the overall market conditions can take place so quickly that investors do not have the opportunity to sell the security.For these reasons,CP is generally less liquid than U.S.Treasury or U.S.government agency or instrumentality obligations. During market disruptions,investors face the scenario where issuers will be unable to issue new CP to refinance the maturing commercial paper and the secondary market disappears.To mitigate this risk,CP is usually backed by bank lines of credit. State statutes vary as to the ability and limits of governments to purchase CP. GFOA recommends that if a government chooses to use CP in its investment portfolio,it cautions government investors to: 1)verify whether commercial paper is allowed under state statute and their investment policy and 2)determine whether they have the expertise to understand,evaluate and monitor commercial paper before deciding to include commercial paper as part of a diversified investment portfolio. Government investors should regularly evaluate whether the incremental yield associated with commercial paper justifies the additional credit and liquidity risk associated with this type of security.Governments choosing to use CP should develop policies and procedures to manage the associated risks.Government investors should consider: • conducting their own ongoing financial reviews of commercial paper issuers,including periodically reviewing balance sheet information for issuers of traditional CP as well as reviewing monthly or quarterly pool reports for ABCP. • diversifying by issuer,industry sector or commercial paper type • placing limits on percentage of portfolio comprised of commercial paper • placing limits on percentage of commercial paper issued by any one issuer,industry,or type • restricting investments to shorter maturities that reflect the most active part of the commercial paper market and provide the least opportunity for credit quality changes • restricting investments in sectors or industries experiencing turmoil,volatility or changes such as major • regulatory or technological changes • recognizing different types of commercial paper,such as corporate promissory notes,asset-backed commercial paper(both multi-issuer and single-issuer programs),SIV issued ABCP(funding paper,or extendible paper)and determining the appropriateness of each for the government's portfolio • limiting to first tier short-term credit ratings by two NRSROs(for example,A-1,P-1,F-1 or better) 52 • evaluating underlying liquidity support and credit enhancements such as bank lines of credit or insurance • maintaining information on each commercial paper issue in the portfolio • monitoring ratings and ratings outlook on a frequent basis • establishing a short pre-approved list of CP programs that investment staff is limited to purchasing,which is monitored frequently References: • Investing Public Funds,Second Edition,Girard Miller with M. Corinne Larson and W.Paul Zorn, GFOA, 1998. • Sample Investment Policy,GFOA,2003. • An Elected Official's Guide:Investing, Second Edition,Sofia Anastopoulos,GFOA,2007. • "Commercial Paper in Today's Credit Markets,"Treasury Management,GFOA,December 2007. 53 Government Finance Officers Association Recommended Practice Diversifying the Investment Portfolio GFOA recommends that state and local governments properly manage the risk in their portfolios to achieve their investment objectives and comply with their investment constraints. Government investors have a fiduciary responsibility to protect public funds and to prudently manage their investments in order to achieve the investment objectives of safety,liquidity,and return.Generally,greater risk in a portfolio increases the opportunity for higher returns.However,greater risk also increases the volatility of the returns,which is another defmition of risk.The effective management of risk in a portfolio is critical for achieving an entity's investment objectives. A useful strategy for managing risk in a portfolio is through diversification.To this end,a government should establish a target risk profile.In establishing a risk profile,an entity considers its investment objectives and constraints,risk tolerances,liquidity requirements and the current risk/reward characteristics of the market.The profile should be adjusted as needed to changes in any of those considerations. Such a profile provides a framework and discipline for making individual investment decisions that manage the risk and create the structure of a portfolio. The government entity's risk profile,in turn,helps it determine appropriate levels of diversification. Diversification of investments in a portfolio is based on the different types of risk-primarily interest rate or market risk,liquidity risk and credit risk.Diversification is achieved by investing in a variety of securities with dissimilar risk characteristics that respond differently to changes in the market.Areas where diversification can be achieved include the maturity distribution in a portfolio(market and liquidity risk), sector allocation(credit risk),issuer allocation(credit risk),and the structures(noncallable vs. callable)of securities(market and liquidity risk). GFOA recommends that state and local governments properly manage the risk in their portfolios to achieve their investment objectives and comply with their investment constraints.GFOA further recommends the use of diversification in a portfolio as an important strategy for managing risk.Diversification strategies can be implemented through the following steps: • carefully and clearly defining what the objectives safety,liquidity and return mean to the government entity • preparing a cash flow projection to determine liquidity needs and the level and distribution of risk that is appropriate for the portfolio • considering political climate,stakeholders'view toward risk,and risk tolerances • ensuring liquidity to meet ongoing obligations by investing a portion of the portfolio in readily available funds,such as Local Government Investment Pools(LGIPs),money market funds,or overnight repurchase agreements • establishing limits on positions in specific securities to protect against default risk • establishing limits on specific business sectors • developing strategies and guidelines for investments in single class of securities(such as commercial paper or bankers acceptances) • limiting investments in securities that have higher credit and/or market risks(such as derivatives) • limiting particular structures(i.e.optionality,amortizing components,coupons,issue sizes) • defining parameters for maturity/duration ranges • establishing a targeted risk profile for the portfolio based on investment objectives and constraints, risk tolerances,liquidity requirements and the current risk/reward characteristics of the market. 54 References: • Elected Official's Guide Investing, Second Edition,Sofia Anastopoulos,GFOA,2007. • Investing Public Funds,Second Edition,Girard Miller with M.Corinne Larson and W.Paul Zorn, GFOA, 1998. 55 Government Finance Officers Association Recommended Practice Managing Market Risk in Investment Portfolios Government investors should follow GFOA recommendations with respect to managing market risk. Fixed-income securities are investment instruments that provide a stream of cash flows in the form of coupon and principal payments.Typically,they are issued with maturities ranging from one year to 30 years.A security's stated maturity is the date on which its final interest and principal payments are due. There are several general structures for fixed-income securities: • Bullet securities-the principal amount will be paid in one payment at maturity.They are issued without any option that could cause redemption prior to the stated maturity; • Securities with options-issued with either a call or put option that could change the stream of cash flows.Call options give the issuer the right to redeem bonds prior to maturity in accordance with the call schedule. Securities with call options have greater volatility than bullet securities. Issuers of callable securities typically call these when interest rates have fallen,causing investors to lose the higher interest rate in periods when such rates are hard to replace.Put options give the investor the right to submit a bond for redemption prior to maturity in accordance with the rules of the put.Buyers pay a premium for the put option.Typically,investors of putable securities"put" these when interest rates have risen,gaining the opportunity to reinvest their principal at the then prevailing higher market rates;and • Amortizing securities-pay a portion of the principal with each interest payment throughout the life of the bond(e.g.:mortgage securities,asset-backed securities).They have a stated fmal maturity and an average maturity and can also have early redemption options. Market risk refers to the effect that changing interest rates have on the present value of a fixed income security and can also be referred to as interest rate risk.There is an inverse relationship between interest rates and price.As interest rates rise,the value of a security falls.The reverse is true as interest rates fall. The extent of price change is a function of the length of term to maturity,the structure of the security(type of embedded options),the level of interest rates,and the size of the coupon. Of these factors,the most important are the length of term to maturity and the structure.Generally,the longer the maturity of a security,the greater its market risk as measured by price volatility.Longer maturities have greater volatility because as the time to maturity increases,each change in interest rates has a greater impact on the present value of a security. The size of a security's coupon also affects price volatility.When analyzing securities with the same maturity,securities with low coupons will have greater price volatility than securities with high coupons. The security with the greatest price volatility for any given maturity is a zero coupon security. Many government investors employ a buy-and-hold approach,so that changes in a security's market value are never realized and the full face value of the security is received upon maturity.Despite this,market value must be managed for three reasons: 1. The total return of the portfolio is computed and compared to the total return of the portfolio's benchmark to evaluate portfolio performance. 2. The market value of an entity's investments must be disclosed in its annual financial report.Often an entity will include it in more frequent reports to the governing body and public.Accordingly, an entity must be able to understand and explain changes in the market value of its portfolio. 3. Circumstances may arise in which an entity is forced to sell a security before its maturity.In such instances,a government entity may have to accept a loss on a security that it had never planned to sell.Market risk is a critical risk for a government investor.Therefore,it is necessary to 56 understand fully the maturity structure of securities before investing.To ensure appropriate liquidity and to reduce interest rate risk in operating portfolios,most state and local governments: • Limit the maximum maturity for securities they purchase; • Ensure that funds are available for scheduled disbursement by developing cash flow projections and properly structuring the maturities in a portfolio according to the expected cash flows; • Ensure that a reasonable liquidity buffer is maintained to meet unexpected disbursements; and • Ensure that a security can be sold with ease and minimal cost(price disruption)to the investor by investing in high grade,actively traded fixed-income securities Maximum maturity and weighted average maturity limits relate directly to an entity's statute and policy constraints,investment objectives and cash flow projections.Although setting maximum maturity constraints may help limit the market risk in a portfolio,it is not generally considered to be the most effective way for managing market risk and understanding the potential price volatility of either an individual security or an entire portfolio.Maximum maturities allow the portfolio to take advantage of longer securities and the weighted average maturity protects against over-extension of the portfolio in those longer maturities. A widely used measure of market risk in the investment industry is modified duration.Durations can be obtained from professional market resources such as Bloomberg.For governments without access to these resources,broker-dealers may send documentation of the durations.Duration is more comprehensive and accurate in measuring market risk than the maturity of a security for two important reasons.First,duration takes into consideration all cash flows(interest and principal payments)of a fixed-income security using their present values.Maturity as a market risk measure only considers the principal payment of a security using its future value. Second,modified duration is a multiplier that measures the approximate percentage change in the value of a security or portfolio given a 1%(100 basis points)move in interest rates.For example,if a security has a modified duration of 1.74 and interest rates rose by 50 basis points,the security would experience approximately a-0.87%change in value. With this type of price volatility analysis,a government investor can determine more accurately the amount of market risk in a security or portfolio. Weighted average maturity and weighted average duration in a portfolio are calculated using the maturity and duration values of all the securities in a portfolio.Weighted average maturity allows a government to verify compliance with investment constraints since most investment policies and state statutes have maximum weighted average maturity limitations.Weighted average duration is considered industry wide as an acceptable measure of market risk in a portfolio.As such,it can provide the government investor with valuable information for managing the market risk in a portfolio. The Governmental Accounting Standards Board(GASB)in GASB Statement No.40 requires a disclosure of all risks associated with a government entity's portfolio,including market risk,including market rate or interest rate risk.Weighted average maturity and weighted average duration are two of five accepted methods for disclosing a portfolio's market risk.(A description of the other three is beyond the scope of this Best Practice.)In accordance with the GASB fair market value reporting requirements in GASB Statement No. 31,a government entity's portfolio could show unrealized losses or gains for any reporting period. State and local governments should comply with state statutes pertaining to investing public funds along with all investment policy parameters.Fixed income investing involves a certain level of market risk. Investors should be aware of their risk tolerance and confirm that the market risk they assume is within this tolerance level. 57 GFOA makes the following recommendations to government investors with respect to managing market risk: 1. Develop and update cash flow projections to determine: a)the dollar amount of the portfolio that needs to remain liquid(liquidity buffer)to meet disbursement obligations within a six-month period(short term),b)what dollar amount is required within the next 6- 12 month period,and c) whether there is a'core'of funds available for longer-term investing. 2. Structure the portfolio to provide sufficient liquidity for anticipated cash flow requirements by continuously investing a portion of the portfolio in money market type investments such as local government investment pools,money market mutual funds,overnight repurchase agreements and money market securities. • 3. Understand fully the maturity structure of a security.Prior to purchase,the government should confirm compliance with its investment constraints and overall investment strategy.If a security has options associated with it such as call options,the structure of the option should be analyzed to determine its potential impact on market risk through an analysis such as option adjusted spread (OAS)analysis.The stated maturity date should always be used to determine compliance with maximum maturity constraints,not any potential call dates unless an official announcement of a call has been released. 4. Adopt weighted average maturity limitations and/or weighted average duration targets,consistent with the government's investment objectives,constraints,cash flow needs and risk tolerances.The weighted average maturity limitations is used to limit the liquidity and market risk in a portfolio consistent with the constraints in the governing state statutes and the investment policy.The weighted average duration targets can be used to manage market risk in a portfolio. 5. Do not directly invest in securities with maturities greater than the limits imposed by investment policy.In general,the maturities in a portfolio should coincide as nearly as practicable with the expected use of funds. Securities with maturities greater than five years should be matched to a specific cash requirement.The government should include in its investment policy a process for authorizing longer-term investments and for providing disclosures. References: • Investing Public Funds,Second Edition,Girard Miller with M. Corinne Larson and W.Paul Zorn, GFOA, 1998. • GFOA Sample Investment Policy,2003. • GASB Statement No.31 and Statement No.40,www.GASB.org 58 Government Finance Officers Association Recommended Practice Local Government Investment Pools In many states,the state treasurer or the authorized governing board of another governmental entity(such as a county)oversees a pooled investment fund that operates like a money market mutual fund for the exclusive benefit of governments within the entity's jurisdiction. Unlike mutual funds,however,local government investment pools(LGIPs)are not registered with the Securities and Exchange Commission(SEC)and are exempt from SEC regulatory requirements because they fall under a governmental exclusion clause.While this exemption allows pools greater flexibility,it also reduces investor protection.Investments in these pools are not insured or guaranteed and substantial losses have occurred in the past. These pools typically combine the cash of participating jurisdictions and invest the cash in securities allowed under the state's laws regarding government investments.By pooling funds,participating governments benefit from economies of scale,full-time portfolio management,diversification,and liquidity(especially in the case of pools that seek a constant net asset value of$1.00).Interest is normally allocated to the participants on a daily basis,proportionate to the size of the investment.Most pools offer a check writing or wire transfer feature that adds value as a cash management tool. Government Sponsored versus Joint Powers Agreement Pools Local government investment pools(LGIPs)may be authorized under state statutes and sponsored by the state or local governments or may be set up through intergovernmental agreements known as"joint powers"agreements.In several states,local governments have joined together through joint powers agreements to sponsor the creation of LGIPs that operate independent of the state government.The investment authorization to pool funds is generally derived from state statutes that allow governments to perform collectively any service or administrative function that they may undertake individually.A board of trustees,normally made up of public officials,oversees these pools and typically selects a fmancial services firm to provide services such as the following:investment management,custodial services, participant record keeping,independent audits,and legal services.These pools may invest only in securities otherwise allowed to individual governments. Whether the LGIP is state-sponsored or created through a joint powers agreement,it is important to be aware that the authorizing entity typically does not guarantee investments in the LGIP. Not All Pools Are the Same Although there are many similarities between the various LGIPs,there are also differences.One significant difference among pools that must be understood before placing money in them is their investment objectives.When LGIPs were first created,most emulated money market mutual funds with the objective of maintaining a"constant"Net Asset Value(NAV)of$1.00 and providing excellent liquidity for the investor. Such LGIPs invest in short-term securities with average maturities sufficiently short to avoid market price risk.The"constant"NAV pools are appropriate investments for funds that must be liquid and have virtually no price volatility. There are also government investment pools that have an investment objective of maximizing return.These pools are variable Net Asset Value(NAV)pools and introduce market risk to the investor through a fluctuating NAV.They invest in longer-term securities,thus subjecting their portfolios and their participants to greater market price volatility.The principal invested in the pool may not be the same principal returned to the investor,depending on the movement of interest rates.While they may be appropriate for longer-term strategies,these pools would not be appropriate for funds that must be liquid and stable. 59 Other differences among pools include legal structure,authorized investments,procedures for depositing and withdrawing money,and services provided to participants.Each pool has a process that a participant must complete,including documents to be signed and banking information to be provided,in order to establish an account. Sources of information for evaluating pools may include a pool offering statement, investment policy or audited fmancial statements. Rated LGIPs1 Rating agencies rate constant dollar LGIPs using the same criteria that they use for rating money market mutual funds.These ratings are based on safety of principal and ability to maintain a NAV of$1. Fluctuating NAV pool ratings include a volatility factor.Pool ratings can provide an additional method of due diligence. GFOA makes the following recommendations to governments that invest in or are considering investing in Local Government Investment Pools(LGIPs). Government investors should: 1. Confirm LGIPs are eligible investments under governing law and the government's investment policy. 2. Fully understand the investment objectives,legal structure and operating procedures of the investment pool before they place any money in the pool.When evaluating an LGIP,investors should read the pool's offering statement,investment policy,and audited fmancial statements carefully. 3. Pay particular attention to the investment objectives of a pool to determine whether the pool seeks to maintain a constant NAV of$1.00 or could have a fluctuating NAV.This information is essential in order to determine which pools are appropriate for liquidity strategies(constant NAV) and which ones are only appropriate for longer-term strategies(fluctuating NAV). 4. Review the pool's list of eligible securities to determine compliance with the participating government's investment policy.Portfolio maturity restrictions and diversification policies should be evaluated to determine potential market and credit risks. 5. Evaluate portfolio pricing practices. 6. Review custodial policies(e.g.,delivery versus payment). 7. Evaluate the qualifications and experience of the portfolio manager,management team and/or investment adviser. 8. Review the earnings performance history relative to other investment alternatives. On constant NAV LGIP funds,the current yield of the portfolio can be compared with competitive institutional money market funds,or overnight repurchase agreement rates. Standard&Poor's releases an index of LGIPs on a weekly basis that reports the average 7-and 30-day yields and average maturities of LGIPs holding its highest ratings(AAAm and AAm).Any pool with above-average yields or longer maturities should be further evaluated for risk. 9. Evaluate variable NAV LGIPs in relation to appropriate benchmarks. 10. Although ratings are not mandatory,seek LGIPs with the highest ratings,where possible. 11. Fully understand procedures for establishing an account,making deposits and withdrawals,and allocating interest earnings.There may be limits to the number of deposits and withdrawals in a month.There may also be dollar limits for deposits,withdrawals and balances.Deposits or withdrawals may require advanced notification,especially if they are large. If so,investors should be aware of the deadlines. 12. When selecting an LGIP,consider any additional services offered by an LGIP,such as:check writing,wire transfers,issuing paying agent services,setting up multiple accounts for an entity, and arbitrage accounting for bond funds. 13. Confirm that an LGIP provides regular,detailed reporting to pool participants and follows accepted reporting standards.GFOA recommends that pool administrators,on a daily basis, determine the market value of all securities in the pool and report this information to all pool participants on at least a monthly basis.These values should be obtained from a reputable and 60 independent source.This information should be included in the report to the governing body prepared on at least a quarterly basis. 14. Be aware that an LGIP may be a part of a diversified portfolio but that a portfolio comprised solely of an LGIP may not provide the government entity with appropriate diversification. 61 Government Finance Officers Association Recommended Practice Using Safekeeping and Third-Party Custodian Services The safety of public funds should be the primary investment objective of all governments. One of the most important protections and a control against fraud is the separation of the safekeeping function from the investment function. Investment policies should include a section regarding safekeeping and custody that defines how the government should have its securities held by an independent third-party for safekeeping to minimize the risk of a fraudulent transaction. An independent third-party in a safekeeping arrangement may be a fmancial institution completely separate from where the depository cash assets are being held,or it may be a separate division of that same named institution. Governments should ensure that if they are using the same institution for both trading their assets and engaging in safekeeping services,that there are proper firewalls and protections in place to safeguard your entity's money. Governments should also be aware of and incorporate state and local laws related to custody and safekeeping. It is also important to be aware that banks and financial institutions may use the terms of custody and safekeeping interchangeably. However,as discussed below and in the Procurement of Safekeeping and Custodial Services Resource,these agreements have different protections and offerings,and the government needs to determine what is the best service level. UNDERSTANDING SAFEKEEPING SERVICES In a typical safekeeping agreement,the government arranges for a firm other than the party that is selling the investment to provide for the transfer and safekeeping of securities. This allows for investment transactions to be settled on a delivery-versus-payment(DVP)basis,wherein a secure delivery and payment occur simultaneously.A safekeeping account does not protect the government from making a bad investment choice or acquiring a defaulted or improper security. There are generally two types of safekeeping services(arrangements)that a government will encounter: • Basic Safekeeping Provider,a brokerage firm or banking institution • Custodial Safekeeping Provider,usually a banking institution Basic Safekeeping Provider Under this arrangement,many times the fees are nominal,or the service is provided at no direct cost as part of a broader relationship.Governments need to understand what services are being provided and how the investment assets are being held. General elements of a basic safekeeping arrangement are as follows: • The investment assets are held in the safekeeping firm's name for the benefit of the government. • The assets are considered general assets of the firm and may not be protected from being used to help pay the safekeeping frm's creditors. • Broker/Dealer accounts may be covered by SIPC Insurance,which is limited to$500,000 and does not cover any changes in the market value of securities. • May allow the ability to use any broker-dealer,depending on the contract arrangement. • May have limited capability related to the sweep of funds to other accounts,such as only allowing accounts held at the same financial institution. • Most operate on an actual receipt of funds basis,subject to delayed credit. • Reporting is provided for account on a basic level,generally with limited detail and no roll-up capabilities. • Basic safekeeping arrangements may affect the government's ability to access its assets timely. 62 Custodial Safekeeping Provider A Custodial Safekeeping Provider has a fiduciary responsibility to its clients and usually charges a set fee based on asset volume. Custodial arrangements with these providers are often referred to as a special type of safekeeping service that is held within a Trust Department of the custodial bank,thus creating and independence from the regular commercial or retail bank.The elements of a Custodial Safekeeping Provider arrangement are as follows: • Investment assets are protected from the claims of creditors,as the assets are considered legally separate from the bank or fmancial institution. • Investment assets are held directly in the government's account • Usually includes an automated overnight cash sweep system to the investment vehicle of the government's choice. • Ability to use any broker/dealer for trades that settle into account. • Comprehensive reporting,including roll-ups and customizable reporting options. • Income is generally posted to account on payable date GFOA recommends that governments use an independent third-party custodial service for safekeeping of investments. Governments need to weigh the risks versus the costs of the services and understand exactly how the failure of a safekeeping provider would impact the government's ability to access its investment assets. Recommended for GFOA Executive Board approval by the Committee on Treasury and Investments, February 2020. 63 Government Finance Officers Association Recommended Practice Ensuring the Safety of Reverse Repurchase Agreements GFOA Advisories identify specific policies and procedures necessary to minimize a government's exposure to potential loss in connection with its financial management activities.It is not to be interpreted as GFOA sanctioning the underlying activity that gives rise to the exposure. Reverse repurchase agreements(reverse repos)are the mirror image of a repo.In a reverse repo,an investor (governmental entity)owns securities,such as a Treasury note,U.S.government agency bond or other security,that a bank or dealer purchases under an agreement and sells back to an investor on a specified date,at an agreed-upon interest rate. Reverse repos generally have two basic uses: • Reverse repos may be one way to avoid liquidating a portfolio to meet unexpected or immediate cash flow requirements.Most public fmance officers accept this straightforward use of the instrument as a legitimate cash management practice. • A potentially more controversial use of the reverse repo is to enhance portfolio returns through the purchase of securities financed through repurchase transactions.The cash obtained can be invested in another higher-yielding instrument. Benefits of Reverse Repos: • Provides an alternative to liquidating a portfolio; • Provides incremental income with use of ce ?in techniques by expert investment officers; Risks Associated with Reverse Repos: • The reverse repurchase agreement with an entity's counterparty is not properly established; • The financial strength of the counterparties and value of the collateral are not properly monitored; • The governmental entity does not possess proper authority to enter into such a transaction; • A counterparty may default on its obligations; • Underlying securities are subject to and may erode due to volatile changes in market conditions; and • The government entity uses the dollars from the reverse repo to leverage the investments in the portfolio. Mitigating the Risk: • Execute a Securities Industry and Financial Markets Association(SIFMA)Master Repurchase Agreement including additional provisions specific to the governmental agency that is signed by a duly authorized officer with each counterparty; • Establish financial strength criteria for counterparties and for reviewing financial statements at the inception of relationship and at least annually. Some entities will limit counterparties to primary dealers; • Use the proceeds from the reverse repo only to invest in securities whose maturity matches or is no longer than the term of the repo;and • Settle the transaction on a delivery-versus-payment(DVP)basis at the entity's custodian or trustee for third party safekeeping. 64 Reverse repo agreements require the same essential basic components as a repo.A Master Repurchase Agreement should be entered into with a bank or counterparty.A form of the agreement may be obtained from the website of the Securities Industry and Financial Markets Association(SIFMA)formerly known as The Bond Market Association(TBMA).The agreement should detail the nature of the deal and conform to suit the specifics of the governmental entity's transaction.Proper securitization practices should be utilized to protect the securities in reverse repo transaction as well as safekeeping duties should be performed by a third-party custodian in accordance with an executed agreement. The conservative and prudent approach to the use of reverse repos involves short-term contracts in which the term of the reverse repo is matched with the maturity of the reinvestment.Losses of state and local government funds(e.g.,losses amounted in the billions in the 1980s and 1990s when governmental entities were borrowing short to lend long in adverse markets)have occurred as the result of unsound investment practices and the inappropriate use of reverse repos in leveraging portfolios to increase investment returns. GFOA recommends that state and local government fmance officers develop policies and procedures to ensure the safety of reverse repos. The following actions are recommended: 1. Government entities and investment officers should exercise special caution in selecting and evaluating the creditworthiness of counterparties with whom they will conduct repurchase transactions and be able to identify the parties acting as principals to the transaction. 2. Reverse repo proceeds generally should be invested in securities whose maturity matches or is no longer than the term of the reverse repo.For example,borrowing short to lend long can produce losses in adverse markets.Further,the possibility exists that other factors can go wrong,such as default by the dealer or adverse market changes that erode the value of the underlying securities. 3. Master repurchase agreements for reverse repos should be employed,subject to appropriate legal and technical review.Governments using the prototype agreement developed by SIFMA should include appropriate supplemental provisions regarding the types of securities,delivery, substitution,margin maintenance,margin amounts,seller representations,and governing law as contained in the GFOA-developed Considerations for Governments in Developing a Master Repurchase Agreement. 4. Governmental entities should only engage in reverse repos if they possess the necessary expertise and resources required to enter into this type of investment.Government officials should verify whether the use of such fmancial instrument is legal in their respective jurisdictions. Governmental officials should not engage in any investment practices for speculative purposes. References: • An Introduction to Broker-Dealers for State and Local Governments, Second Edition,Sofia Anastopoulos,GFOA,2008. • An Introduction to Collateralizing Public Deposits for State and Local Governments,Second Edition,M. Corinne Larson,GFOA,2006. • Investing Public Funds, Second Edition,Girard Miller with M. Corinne Larson and W.Paul Zorn, GFOA, 1998. • GFOA Best Practice,Frequency of Purchased Securities Valuation in Repurchase Agreements (1999,2003,2006,2008). • Considerations for Governments in Developing a Master Repurchase Agreement, Third Edition, 2001. • "Do You Know Your Repurchase Agreements as Well as You Think?" GFOA's Treasury Management Newsletter,October 3,2009,Volume 27,Number 10. • Sample Custodial Trust Agreement,GFOA. • The Securities Industry and Financial Markets Association(SIFMA)http://www.sifina.org 65 Government Finance Officers Association Recommended Practice Investment and Management of Bond Proceeds When governments issue bonds,additional considerations are likely to apply to bond proceeds.Investment policies,legal requirements such as the arbitrage yield permitted under federal tax rules,requirements from bond covenants and/or credit enhancement providers,and the anticipated timing of drawdown of bond proceeds should be taken into account when determining what investments to purchase.Multiple accounts with varied investment horizons are often involved. Cash flow analyses are critical components of the process and are useful in reducing the possibility of "negative arbitrage"that may occur when the rate of interest paid on the bonds that are issued exceeds the interest received from reinvestment opportunities.The manner in which bond proceeds are invested may have a material impact on the size and cost of a bond issue,and on the cash flow available to make debt service payments and needs to be understood and analyzed by governmental issuers in that context. The Government Finance Officers Association(GFOA)recommends the following: Issuers should have an Investment Policy that addresses a bond indenture's permitted investments and other investment requirements related to bond proceeds with that policy. Issuers should be aware of unique considerations related to investing bond proceeds such as multiple accounts that may be required for a bond issue,the Municipal Advisor Rule as it relates to investment advice on bond proceeds,and tax compliance issues related to tax-exempt bond proceeds. Issuers should coordinate the management of bond proceeds with the necessary staff in their government to ensure funds are spent properly and cash flows are matched with investment maturities. GFOA recommends that governments have an Investment Policy which takes into consideration all inherent risks and which also includes specific policies for the investment of bond proceeds to ensure that legal and regulatory requirements are met,fair market value bids are received,and issuer objectives for various uses of proceeds are attained.Governments should be aware that different types of bond proceeds may have different investment goals. Often the bond indenture will contain a list of permitted investments as well as any other investment requirements related to credit enhancement providers.Different types of debt issuances may have unique investment requirements related to various Federal,State and other programs. These requirements need to be coordinated with the Investment Policy.In addition,governments should discuss with bond counsel any required disclosures related to investments. Establishment of Multiple Funds and Accounts Governments typically must establish various funds and accounts as required in the bond indentures and must be knowledgeable of different types of investment that each fund may require. Some common funds and accounts and associated investment horizons include the following: • Construction Fund(investment horizon is short-term,typically ranges from 12-36 months) • Capitalized Interest Fund(investment horizon is short-term,typically ranges from 6-18 months) • Interest Account(investment horizon is usually 6 months) • Sinking Fund/Principal Account(investment horizon is usually 12 months) • Escrow Fund/Redemption Account(investment horizon depends on a redemption date) 66 • Debt Service Reserve Fund(investment horizon is long-term,maximum duration investment allowed under governments' Investment Policy may be used) While these are typical investment horizons for each of the funds/accounts described above,expectations and requirements can vary across governments and each issuer should consult with their advisory team and Investment Policy to determine optional timeframes and security options. The MA Rule and Broker-Dealers Advice Due to the Securities and Exchange Commission's(SEC)Municipal Advisor(MA)Rule,brokers may be considered municipal advisors if they provide advice on investments of bond proceeds to governments, which limits the ability to directly solicit information from broker-dealers on reinvestment choices. Governments should understand their interactions with broker-dealers under the existing regulatory environment at the time of a bond sale and how they will engage specific professionals to formulate an ultimate decision on the efficiency of reinvestment options that will be selected. Governments may obtain advice from a broker-dealer through a Request for Proposals(RFP)process or when they have retained an independent registered municipal advisor(IRMA)whose duties include advice on investments. The GFOA Alert on the MA Rule can serve as a resource for issuers on understating the MA roles,their fiduciary duties,and the RFP or IRMA exemption.Issuers may also choose to retain a registered investment adviser if they want more than de minimis investment advice. Tax Compliance Municipal issuers should be knowledgeable and consult with tax and legal counsel on various Federal tax rules and post-issuance tax compliance requirements for tax-exempt bond proceeds in order to maintain their tax-exempt status. In the broadest terms,the tax requirements can be grouped into two categories: (1) arbitrage and rebate;and(2)use of bond proceeds and of bond-fmanced facilities.Each of these categories involve rules that make it advisable for an issuer to adopt practices that track how bond proceeds are invested and how and when bond proceeds are spent.Further,issuers should maintain proper records for the required time period,which is typically the life of the bonds plus three years. Management of Bond Proceeds Spending When an issuer sells new money bonds and expects to take a considerable period of time to spend bond proceeds on capital projects,this may result in an interest cost that exceeds interest earnings during that time period("negative arbitrage"). It is critical to develop consistent and reliable spend-down estimates for the associated capital projects and periodically update those estimates to compare against investment income projections based upon prevailing and expected market conditions. Issuers will need to identify and ensure coordination between the persons responsible for monitoring and managing spending,cash flow projections,and investment performance and compliance. This is especially true if these areas involve different offices and staff and can typically include debt management staff, treasury staff,public works or engineering staff,etc. This coordination is critical and GFOA recommends that governments do the following: • Monitor how and when bond proceeds will be invested and spent with respect to federal tax law requirements,especially when there are changes in timing or spending plans from what was planned at the time of bond issuance. • Make certain that the drawdown of proceeds is planned and recorded and that the investment duration is shorter than the expected drawdown schedule. Since the draw schedule may change over time,it should be periodically revisited. 67 • Borrow only as much as needed to fund capital projects or expected expenses,after consideration of cash funding,grants,or other funding sources. • Explore options to stage bond issues over the capital construction period to minimize potential arbitrage liability and/or negative arbitrage. Consider not issuing bonds significantly earlier than proceeds are expected to begin being spent on capital expenditures. References: • GFOA Investment Policy BP and Sample Investment Policy; • GFOA Investment Program for Public Fund BP; • GFOA Primary Market Disclosure BP; • GFOA Alert:The MA Rule and Issuers; • GFOA Selection and Review of Investment Advisors BP; • GFOA Government Relationships with Securities Dealers BP; • GFOA Post-Issuance Compliance BP; • GFOA Developing and Implementing Procedures for Post-Issuance Tax Compliance for Issuers of Governmental Bonds Alert; • NABL Considerations for Developing Post-Issuance Tax Compliance Procedures. 68 Government Finance Officers Association Recommended Practice Using Benchmarks to Assess Portfolio Risk and Return Measuring portfolio risk and return results against appropriate market benchmarks) is a technique to verify that all the investment objectives are being met and that portfolio investment returns are appropriate for the risk incurred. Comparing total return to a proper benchmark or index is the preferred means for assessing performance relative to risk and investment objectives. Investment yield alone is not sufficient for assessing risk and performance. Investment yield measures the percentage increase or decrease that a portfolio generates during a given period and is useful for budgeting purposes but overall,is unreliable for decision making and assessing the risk and return characteristics of the portfolio. 1. There are many defmitions of yield such as: yield to maturity,yield to call,book yield,and market yield. 2. Yield results can be distorted by the timing of investing relative to the current level of interest rates and by the presence of call options. For example,it is possible to sell a bond at a loss and buy another bond with a higher yield leaving an increase in the investment portfolio yield but a decrease in the portfolio size. 3. Yield can be manipulated to generate more income or show higher yield in one particular period as opposed to others. The Government Finance Officers Association recommends that government investors assess their investment portfolio for performance and risk by comparing the total return of the portfolio to carefully selected benchmarks. Total return provides a complete snapshot of the outcomes resulting from investment decisions since it measures the percent change in the value of a portfolio over a defmed historical period. 1. Total return comparisons should be completed as least quarterly and more often for portfolios managed by external provides and those containing large investments. Any total return measurement that is much greater or much less than that of the benchmark should be analyzed since significant deviations between the total return measurement and the benchmark often correlates to the portfolio risk profile. Based on total return analysis,investment managers can make adjustments to the portfolio's risk profile when it is determined to be outside the acceptable variance with the benchmark. To provide a valid reference for comparison of an entity's investment portfolio,it is important to select a benchmark that closely resembles policy constraints and management practice in terms of duration, maturity range,average duration,security types,sector allocations and credit quality. Selected benchmark should: 1. Be unambiguous and transparent—The names and weights of securities that constitute a benchmark should be clearly defmed; 2. Be investable—The benchmark should contain securities that an investor can purchase in the market or easily replicate; 3. Be priced on a regular basis—The benchmark's return should be calculated regularly; 4. Be supported by historical data—Past returns of the benchmark should be available in order to gauge historical returns; 5. Be specified in advance—The benchmark should be adopted prior to the start of evaluation; 6. Be consistent—Consistently keep the same benchmark for comparison purposes; 7. Have published risk characteristics—The benchmark provider should regularly publish detailed risk metrics of the benchmark so an investor can compare his/her portfolio risks against the benchmark risks;and 8. Have a composition that is similar to the portfolio holdings. 69 Notes: 1 A benchmark(or index)is an unmanaged basket of securities that provides a reference for understanding performance and risk characteristics of an investment strategy given investment policy parameters. 70 APPENDIX F Various Code of Virginia Provisions Pertaining to Investment of Local Government Funds 71 §2.2-4500.Legal investments for public sinking funds. The Commonwealth,all public officers,municipal corporations,other political subdivisions and all other public bodies of the Commonwealth may invest any sinking funds belonging to them or within their control in the following securities: 1.Bonds,notes and other evidences of indebtedness of the Commonwealth,and securities unconditionally guaranteed as to the payment of principal and interest by the Commonwealth. 2.Bonds,notes and other obligations of the United States,and securities unconditionally guaranteed as to the payment of principal and interest by the United States,or any agency thereof.The evidences of indebtedness enumerated by this subdivision may be held directly,or in the form of repurchase agreements collateralized by such debt securities,or in the form of securities of any open-end or closed-end management type investment company or investment trust registered under the Investment Company Act of 1940,provided that the portfolio of such investment company or investment trust is limited to such evidences of indebtedness,or repurchase agreements collateralized by such debt securities,or securities of other such investment companies or investment trusts whose portfolios are so restricted. 3.Bonds,notes and other evidences of indebtedness of any county,city,town,district,authority or other public body of the Commonwealth upon which there is no default;provided,that such bonds,notes and other evidences of indebtedness of any county,city,town,district,authority or other public body are either direct legal obligations of,or those unconditionally guaranteed as to the payment of principal and interest by the county,city,town,district,authority or other public body in question;and revenue bonds issued by agencies or authorities of the Commonwealth or its political subdivisions upon which there is no default. 4.Bonds and other obligations issued,guaranteed or assumed by the International Bank for Reconstruction and Development,bonds and other obligations issued,guaranteed or assumed by the Asian Development Bank and bonds and other obligations issued,guaranteed or assumed by the African Development Bank. 5. Savings accounts or time deposits in any bank or savings institution within the Commonwealth provided the bank or savings institution is approved for the deposit of other funds of the Commonwealth or other political subdivision of the Commonwealth. (1956,c. 184, §2-297; 1958,c. 102; 1966,c. 677, § 2.1-327; 1970,c. 75; 1974,c.288; 1986,c.270; 1988, cc. 526,834; 1996,cc. 77,508;2001,c.844.) §2.2-4501.Legal investments for other public funds. A.The Commonwealth,all public officers,municipal corporations,other political subdivisions and all other public bodies of the Commonwealth may invest any and all moneys belonging to them or within their control,other than sinking funds,in the following: 1. Stocks,bonds,notes,and other evidences of indebtedness of the Commonwealth and those unconditionally guaranteed as to the payment of principal and interest by the Commonwealth. 2.Bonds,notes and other obligations of the United States,and securities unconditionally guaranteed as to the payment of principal and interest by the United States,or any agency thereof.The evidences of indebtedness enumerated by this subdivision may be held directly,or in the form of repurchase agreements collateralized by such debt securities,or in the form of securities of any open-end or closed-end management type investment company or investment trust registered under the Investment Company Act of 1940,provided that the portfolio of such investment company or investment trust is limited to such evidences of indebtedness,or repurchase agreements collateralized by such debt securities,or securities of other such investment companies or investment trusts whose portfolios are so restricted. 3. Stocks,bonds,notes and other evidences of indebtedness of any state of the United States upon which there is no default and upon which there has been no default for more than 90 days,provided that within the 20 fiscal years next preceding the making of such investment,such state has not been in default for more than 90 days in the payment of any part of principal or interest of any debt authorized by the legislature of such state to be contracted. 4. Stocks,bonds,notes and other evidences of indebtedness of any county,city,town,district,authority or other public body in the Commonwealth upon which there is no default,provided that if the principal and interest be payable from revenues or tolls and the project has not been completed,or if completed,has not established an operating record of net earnings available for payment of principal and interest equal to estimated requirements for that purpose according to the terms of the issue,the standards of judgment and 72 care required in Article 9(§ 64.2-780 et seq.)of Chapter 7 of Title 64.2,without reference to this section, shall apply. In any case in which an authority,having an established record of net earnings available for payment of principal and interest equal to estimated requirements for that purpose according to the terms of the issue, issues additional evidences of indebtedness for the purposes of acquiring or constructing additional facilities of the same general character that it is then operating,such additional evidences of indebtedness shall be governed by the provisions of this section without limitation. 5. Legally authorized stocks,bonds,notes and other evidences of indebtedness of any city,county,town,or district situated in any one of the states of the United States upon which there is no default and upon which there has been no default for more than 90 days,provided that(i)within the 20 fiscal years next preceding the making of such investment,such city,county,town,or district has not been in default for more than 90 days in the payment of any part of principal or interest of any stock,bond,note or other evidence of indebtedness issued by it;(ii)such city,county,town,or district shall have been in continuous existence for at least 20 years;(iii)such city,county,town,or district has a population,as shown by the federal census next preceding the making of such investment,of not less than 25,000 inhabitants;(iv)the stocks,bonds, notes or other evidences of indebtedness in which such investment is made are the direct legal obligations of the city,county,town,or district issuing the same; (v)the city,county,town,or district has power to levy taxes on the taxable real property therein for the payment of such obligations without limitation of rate or amount;and(vi)the net indebtedness of such city,county,town,or district(including the issue in which such investment is made),after deducting the amount of its bonds issued for self-sustaining public utilities, does not exceed 10 percent of the value of the taxable property in such city,county,town,or district,to be ascertained by the valuation of such property therein for the assessment of taxes next preceding the making of such investment. 6.Bonds and other obligations issued,guaranteed or assumed by the International Bank for Reconstruction and Development,by the Asian Development Bank or by the African Development Bank. B. This section shall not apply to funds authorized by law to be invested by the Virginia Retirement System or to deferred compensation plan funds to be invested pursuant to§51.1-601 or to funds contributed by a locality to a pension program for the benefit of any volunteer fire department or volunteer emergency medical services agency established pursuant to§ 15.2-955. C.Investments made prior to July 1, 1991,pursuant to§ 51.1-601 are ratified and deemed valid to the extent that such investments were made in conformity with the standards set forth in Chapter 6(§ 51.1-600 et seq.)of Title 51.1. 1956,c. 184,§ 2-298; 1966,c. 677,§2.1-328; 1980,c. 596; 1988,c. 834; 1991,c.379; 1992,c.810; 1996, c. 508; 1999,c. 772;2001,c. 844;2007,c. 67;2008,c.295;2015,cc.502,503. §2.2-4502.Investment of funds of Commonwealth,political subdivisions,and public bodies in "prime quality"commercial paper. A.The Commonwealth,all public officers,municipal corporations,other political subdivisions and all other public bodies of the Commonwealth may invest any and all moneys belonging to them or within their control other than sinking funds in"prime quality"commercial paper,with a maturity of 270 days or less, of issuing corporations organized under the laws of the United States,or of any state thereof including paper issued by banks and bank holding companies. "Prime quality"means that the paper has received at least two of the following ratings:(i)at least prime 1 by Moody's Investors Service,Inc.;(ii)at least Al by Standard&Poor's;or(iii)at least Fl by Fitch Ratings,Inc.,provided that at the time of any such investment: 1.The issuing corporation,or its guarantor,has a net worth of at least$50 million;and 2.The net income of the issuing corporation,or its guarantor,has averaged$3 million per year for the previous five years;and 3.All existing senior bonded indebtedness of the issuer,or its guarantor,has received at least two of the following ratings: (i)at least A by Moody's Investors Service,Inc.;(ii)at least A by Standard&Poor's;or (iii)at least A by Fitch Ratings,Inc. Not more than 35 percent of the total funds available for investment may be invested in commercial paper, and not more than five percent of the total funds available for investment may be invested in commercial paper of any one issuing corporation. 73 B.Notwithstanding subsection A,the Commonwealth,municipal corporations,and other political subdivisions and public bodies of the Commonwealth may invest any and all moneys belonging to them or within their control,except for sinking funds,in commercial paper other than"prime quality"commercial paper as defined in this section,provided that: 1.Prior written approval is obtained from the governing board,committee,or other entity that determines investment policy.The Treasury Board shall be the governing body for the Commonwealth;and 2.A written internal credit review justifying the creditworthiness of the issuing corporation is prepared in advance and made part of the purchase file. 1973,c.232,§ 2.1-328.1; 1974,c.295; 1976,c.665; 1986,c. 170; 1987,c.73; 1988,c. 834; 1992,c.769; 2001,c. 844;2020,c.333. §2.2-4503. Not applicable §2.2-4504.Investment of funds by the Commonwealth and political subdivisions in bankers' acceptances. Notwithstanding any provisions of law to the contrary,all public officers,municipal corporations,other political subdivisions and all other public bodies of the Commonwealth may invest any and all moneys belonging to them or within their control other than sinking funds in bankers'acceptances. (1981,c. 18, §2.1-328.3; 1988,c. 834;2001,c. 844.) §2.2-4505.Investment in certificates representing ownership of treasury bond principal at maturity or its coupons for accrued periods. Notwithstanding any provision of law to the contrary,the Commonwealth,all public officers,municipal corporations,other political subdivisions and all other public bodies of the Commonwealth may invest any and all moneys belonging to them or within their control,in certificates representing ownership of either treasury bond principal at maturity or its coupons for accrued periods.The underlying United States Treasury bonds or coupons shall be held by a third-party independent of the seller of such certificates. (1983,c. 117,§2.1-328.5; 1985,c.352; 1988,c. 834;2001,c. 844.) §2.2-4506.Securities lending. Notwithstanding any provision of law to the contrary,the Commonwealth,all public officers,municipal corporations,political subdivisions and all public bodies of the Commonwealth may engage in securities lending from the portfolio of investments of which they have custody and control,other than sinking funds. The Treasury Board shall develop guidelines with which such securities lending shall fully comply. Such guidelines shall ensure that the state treasury is at all times fully collateralized by the borrowing institution. (1983,c.268, §2.1-328.6;2001,c. 844.) §2.2-4507.Investment of funds in overnight,term and open repurchase agreements. Notwithstanding any provision of law to the contrary,the Commonwealth,all public officers,municipal corporations,other political subdivisions and all other public bodies of the Commonwealth,may invest any and all moneys belonging to them or within their control in overnight,term and open repurchase agreements that are collateralized with securities that are approved for direct investment. (1985,c. 352, §2.1-328.8; 1988,c. 834;2001,c. 844.) §2.2-4508.Investment of certain public moneys in certain mutual funds. Notwithstanding any provision of law to the contrary,the Commonwealth,all public officers,municipal corporations,other political subdivisions and all other public bodies of the Commonwealth may invest any and all moneys belonging to them or within their control,other than sinking funds that are governed by the provisions of§ 2.2-4500,in one or more open-end investment funds,provided that the funds are registered under the Securities Act(§ 13.1-501 et seq.)of the Commonwealth or the Federal Investment Co.Act of 74 1940,and that the investments by such funds are restricted to investments otherwise permitted by law for political subdivisions as set forth in this chapter,or investments in other such funds whose portfolios are so restricted. (1986,c. 170,§2.1-328.9; 1988,c. 834; 1996,c.508;2001,c. 844.) §2.2-4509.Investment of funds in negotiable certificates of deposit and negotiable bank deposit notes. Notwithstanding any provision of law to the contrary,the Commonwealth and all public officers,municipal corporations,and other political subdivisions and all other public bodies of the Commonwealth may invest any or all of the moneys belonging to them or within their control,other than sinking funds,in negotiable certificates of deposit and negotiable bank deposit notes of domestic banks and domestic offices of foreign banks: 1.With maturities not exceeding one year,that have received at least two of the following ratings: (i)at least A-1 by Standard&Poor's;(ii)at least P-1 by Moody's Investors Service,Inc.;or(iii)at least Fl by Fitch Ratings,Inc.;and 2.With maturities exceeding one year and not exceeding five years,that have received at least two of the following ratings: (i)at least AA by Standard&Poor's;(ii)at least Aa by Moody's Investors Service,Inc.; or(iii)at least AA by Fitch Ratings,Inc. 1998,cc.20,21,§2.1-328.15;2001,c. 844;2020,c. 333. §2.2-4510.Investment of funds in corporate notes. A.Notwithstanding any provision of law to the contrary,the Commonwealth,all public officers,municipal corporations,other political subdivisions and all other public bodies of the Commonwealth may invest any and all moneys belonging to them or within their control,other than sinking funds,in high quality corporate notes with maturities of no more than five years that have received at least two of the following ratings: (i) at least Aa by Moody's Investors Service,Inc.;(ii)at least AA by Standard and Poor's;or(iii)at least AA by Fitch Ratings,Inc. B.Notwithstanding any provision of law to the contrary,any qualified public entity of the Commonwealth may invest any and all moneys belonging to it or within its control,other than sinking funds,in high quality corporate notes that have received at least two of the following ratings: (i)at least A by Moody's Investors Service,Inc.; (ii)at least A by Standard and Poor's;or(iii)at least A by Fitch Ratings,Inc. As used in this section,"qualified public entity"means any state agency or institution of the Commonwealth,having an internal or external public funds manager with professional investment management capabilities. C.Notwithstanding any provision of law to the contrary,the Department of the Treasury may invest any and all moneys belonging to it or within its control,other than sinking funds,in high quality corporate notes with a rating of at least BBB or Baa2 by two rating agencies.One of the two qualifying ratings shall be(i)at least Baal by Moody's Investors Service,Inc.;(ii)at least BBB by Standard and Poor's;or(iii)at least BBB by Fitch Ratings,Inc.With regard to investment securities rated below A,the Commonwealth Treasury Board shall establish strict investment guidelines concerning the investment in such securities and monitor the performance of the securities for compliance with the investment guidelines. 1987,c. 187, § 2.1-328.10; 1988,c. 834; 1994,c. 145;2001,c. 844;2002,cc. 18,438;2005,c.30;2020,c. 333. §2.2-4511.Investment of funds in asset-backed securities. Notwithstanding any provision of law to the contrary,any qualified public entity of the Commonwealth may invest any and all moneys belonging to it or within its control,other than sinking funds,in asset- backed securities with a duration of no more than five years with a rating of at least AAA or Aaa by two rating agencies.One of the two qualifying ratings shall be(i)at least Aaa by Moody's Investors Service, Inc.; (ii)at least AAA by Standard and Poor's;or(iii)at least AAA by Fitch Ratings,Inc. 75 As used in this section, "qualified public entity"means any state agency,institution of the Commonwealth or statewide authority created under the laws of the Commonwealth having an internal or external public funds manager with professional investment management capabilities. 1994,c. 145, §2.1-328.13; 1997,c.29;2001,c. 844;2020,c. 333. §2.2-4512.Investment of funds by State Treasurer in obligations of foreign sovereign governments. Notwithstanding any provision of law to the contrary,the State Treasurer may invest unexpended or excess moneys in any fund or account over which he has custody and control,other than sinking funds,in fully hedged debt obligations of sovereign governments and companies that are fully guaranteed by such sovereign governments with a maturity of no more than five years that have received at least two of the following ratings: (i)at least Aaa by Moody's Investors Service,Inc.;(ii)at least AAA by Standard and Poor's;or(iii)at least AAA by Fitch Ratings,Inc. Not more than 10 percent of the total funds of the Commonwealth available for investment may be invested in the manner described in this section. 1988,c.461, § 2.1-328.11;2001,c.844;2020,c.333. §2.2-4513.1.Investment of funds in qualified investment pools. A.Notwithstanding the provisions of Article 1 (§ 15.2-1300 et seq.)of Chapter 13 of Title 15.2,in any locality in which the authority to invest moneys belonging to or within the control of the locality has been granted to its elected treasurer,the treasurer may act on behalf of his locality to become a participating political subdivision in qualified investment pools without an ordinance adopted by the locality approving a joint exercise of power agreement.For purposes of this section,"qualified investment pool"means a jointly administered investment pool organized as a trust fund pursuant to Article 1 of Chapter 13 of Title 15.2 that has a professional investment manager. B.Investments in qualified investment pools described in this section shall comply with the requirements of this chapter applicable to municipal corporations and other political subdivisions. C.The provisions of this section shall not apply to local trusts established pursuant to Article 8 (§ 15.2- 1544 et seq.)of Chapter 15 of Title 15.2 to fund postemployment benefits other than pensions. 2017,cc. 792,819. §2.2-4514.Commonwealth and its political subdivisions as trustee of public funds; standard of care in investing such funds. Public funds held by the Commonwealth,public officers,municipal corporations,political subdivisions, and any other public body of the Commonwealth shall be held in trust for the citizens of the Commonwealth.Any investment of such funds pursuant to the provisions of this chapter shall be made solely in the interest of the citizens of the Commonwealth and with the care,skill,prudence,and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. (1996,c.437,§ 2.1-328.14;2001,c.844.) §2.2-4515.Collateral and safekeeping arrangements. Securities purchased pursuant to the provisions of this chapter shall be held by the public official, municipal corporation or other political subdivision or public body or its custodial agent who may not otherwise be a counterparty to the investment transaction. Securities held on the books of the custodial agent by a custodial agent shall be held in the name of the municipal corporation,political subdivision or other public body subject to the public body's order of withdrawal.The responsibilities of the public official,municipal corporation,political subdivision or other public body shall be evidenced by a written agreement that shall provide for delivery of the securities by the custodial agent in the event of default by a counterparty to the investment transaction. 76 As used in this section, "counterparty"means the issuer or seller of a security,an agent purchasing a security on behalf of a public official,municipal corporation,political subdivision or other public body or the party responsible for repurchasing securities underlying a repurchase agreement. The provisions of this section shall not apply to(i)investments with a maturity of less than 31 calendar days or(ii)the State Treasurer,who shall comply with safekeeping guidelines issued by the Treasury Board or to endowment funds invested in accordance with the provisions of the Uniform Prudent Management of Institutional Funds Act,Chapter 11 (§ 64.2-1100 et seq.)of Title 64.2. 1988,c. 834, §2.1-329.01;2001,c. 844;2008,c. 184. §2.2-4516.Liability of treasurers or public depositors. When investments are made in accordance with this chapter,no treasurer or public depositor shall be liable for any loss therefrom in the absence of negligence,malfeasance,misfeasance,or nonfeasance on his part or on the part of his assistants or employees. (1979,c. 135,§ 2.1-329.1;2001,c.844.) § 2.2-4517.Contracts on interest rates,currency,cash flow or on other basis. A.Any state entity may enter into any contract or other arrangement that is determined to be necessary or appropriate to place the obligation or investment of the state entity,as represented by bonds or investments, in whole or in part,on the interest rate cash flow or other basis desired by the state entity. Such contract or other arrangement may include contracts providing for payments based on levels of,or changes in,interest rates. These contracts or arrangements may be entered into by the state entity in connection with,or incidental to,entering into,or maintaining any(i)agreement that secures bonds or(ii)investment,or contract providing for investment,otherwise authorized by law.These contracts and arrangements may contain such payment,security,default,remedy,and other terms and conditions as determined by the state entity,after giving due consideration to the creditworthiness of the counterparty or other obligated party, including any rating by a nationally recognized rating agency,and any other criteria as may be appropriate. The determinations referred to in this subsection may be made by the Treasury Board,the governing body of the state entity or any public funds manager with professional investment capabilities duly authorized by the Treasury Board or the governing body of any state entity authorized to issue such obligations to make such determinations. As used in this section,"state entity"means the Commonwealth and all agencies,authorities,boards and institutions of the Commonwealth. B.Any money set aside and pledged to secure payments of bonds or any of the contracts entered into pursuant to this section may be invested in accordance with this chapter and may be pledged to and used to service any of the contracts or other arrangements entered into pursuant to this section. (2002,c.407.) §2.2-4518.Investment of funds in deposits. A.Notwithstanding any provision of law to the contrary,the Commonwealth and all public officers, municipal corporations,other political subdivisions,and all other public bodies of the Commonwealth, each referred to in this section as a"public entity,"may invest any or all of the moneys belonging to them or within their control in accordance with the following conditions: 1.The moneys are initially invested through any federally insured bank or savings institution selected by the public entity that is qualified by the Virginia Treasury Board to accept public deposits; 2. The selected bank or savings institution arranges for the deposit of the moneys in one or more federally insured banks or savings institutions wherever located,for the account of the public entity; 3. The full amount of principal and any accrued interest of each such deposit is covered by federal deposit insurance; 4.The selected bank or savings institution acts as custodian for the public entity with respect to each deposit issued for the public entity's account; and 5.At the same time that the public entity's moneys are deposited,the selected bank or savings institution receives an amount of deposits from customers of other financial institutions wherever located equal to or greater than the amount of moneys invested by the public entity through the selected bank or savings institution. 77 B.After deposits are made in accordance with the conditions prescribed in subsection A,such deposits shall not be subject to the provisions of Chapter 44(§2.2-4400 et seq.),§2.2-4515,or any security or collateral requirements that may otherwise be applicable to the investment or deposit of public moneys by government investors. 2008,c. 103;2010,c.33. §2.2-4519.Investment of funds by the Virginia Housing Development Authority and the Virginia Resources Authority. A.For purposes of§§36-55.44 and 62.1-221 only,the following investments shall be considered lawful investments and shall be conclusively presumed to have been prudent: 1.Obligations of the Commonwealth.Stocks,bonds,notes,and other evidences of indebtedness of the Commonwealth,and those unconditionally guaranteed as to the payment of principal and interest by the Commonwealth. 2.Obligations of the United States. Stocks,bonds,treasury notes,and other evidences of indebtedness of the United States,including the guaranteed portion of any loan guaranteed by the Small Business Administration,an agency of the United States government,and those unconditionally guaranteed as to the payment of principal and interest by the United States;bonds of the District of Columbia;bonds and notes of the Federal National Mortgage Association and the Federal Home Loan Banks;bonds,debentures,or other similar obligations of federal land banks,federal intermediate credit banks,or banks of cooperatives, issued pursuant to acts of Congress;and obligations issued by the United States Postal Service when the principal and interest thereon is guaranteed by the government of the United States.The evidences of indebtedness enumerated by this subdivision may be held directly,in the form of repurchase agreements collateralized by such debt securities,or in the form of securities of any open-end or closed-end management type investment company or investment trust registered under the federal Investment Company Act of 1940,provided that the portfolio of such investment company or investment trust is limited to such evidences of indebtedness or repurchase agreements collateralized by such debt securities, or securities of other such investment companies or investment trusts whose portfolios are so restricted. 3.Obligations of other states. Stocks,bonds,notes,and other evidences of indebtedness of any state of the United States upon which there is no default and upon which there has been no default for more than 90- days,provided that within the 20 fiscal years next preceding the making of such investment,such state has not been in default for more than 90 days in the payment of any part of principal or interest of any debt authorized by the legislature of such state to be contracted. 4.Obligations of Virginia counties,cities,or other public bodies. Stocks,bonds,notes,and other evidences of indebtedness of any county,city,town,district,authority,or other public body in the Commonwealth upon which there is no default,provided that if the principal and interest is payable from revenues or tolls and the project has not been completed,or if completed,has not established an operating record of net earnings available for payment of principal and interest equal to estimated requirements for that purpose according to the terms of the issue,the standards of judgment and care required in the Uniform Prudent Investor Act(§64.2-780 et seq.),without reference to this section,shall apply. In any case in which an authority,having an established record of net earnings available for payment of principal and interest equal to estimated requirements for that purpose according to the terms of the issue, issues additional evidences of indebtedness for the purposes of acquiring or constructing additional facilities of the same general character that it is then operating,such additional evidences of indebtedness shall be governed fully by the provisions of this section without limitation. 5.Obligations of cities,counties,towns,or districts of other states.Legally authorized stocks,bonds,notes, and other evidences of indebtedness of any city,county,town,or district situated in any one of the states of the United States upon which there is no default and upon which there has been no default for more than 90 days,provided that(i)within the 20 fiscal years next preceding the making of such investment,the city, county,town,or district has not been in default for more than 90 days in the payment of any part of principal or interest of any stock,bond,note,or other evidence of indebtedness issued by it;(ii)the city, county,town,or district shall have been in continuous existence for at least 20 years;(iii)the city,county, town,or district has a population,as shown by the federal census next preceding the making of such investment,of not less than 25,000 inhabitants;(iv)the stocks,bonds,notes,or other evidences of indebtedness in which such investment is made are the direct legal obligations of the city,county,town,or district issuing the same;(v)the city,county,town,or district has power to levy taxes on the taxable real property therein for the payment of such obligations without limitation of rate or amount;and(vi)the net 78 indebtedness of the city,county,town,or district,including the issue in which such investment is made, after deducting the amount of its bonds issued for self-sustaining public utilities,does not exceed 10 percent of the value of the taxable property in the city,county,town,or district,to be ascertained by the valuation of such property therein for the assessment of taxes next preceding the making of such investment. 6.Obligations subject to repurchase.Investments set forth in subdivisions 1 through 5 may also be made subject to the obligation or right of the seller to repurchase these on a specific date. 7.Bonds secured on real estate.Bonds and negotiable notes directly secured by a first lien on improved real estate or farm property in the Commonwealth,or in any state contiguous to the Commonwealth within a 50-mile area from the borders of the Commonwealth,not to exceed 80 percent of the fair market value of such real estate,including any improvements thereon at the time of making such investment,as ascertained by an appraisal thereof made by two reputable persons who are not interested in whether or not such investment is made. 8.Bonds secured on city property in Fifth Federal Reserve District.Bonds and negotiable notes directly secured by a first lien on improved real estate situated in any incorporated city in any of the states of the United States which lie wholly or in part within the Fifth Federal Reserve District of the United States as constituted on June 18, 1928,pursuant to the act of Congress of December 23, 1913,known as the Federal Reserve Act,as amended,not to exceed 60 percent of the fair market value of such real estate,with the improvements thereon,at the time of making such investment,as ascertained by an appraisal thereof made by two reputable persons who are not interested in whether or not such investment is made,provided that such city has a population,as shown by the federal census next preceding the making of such investments, of not less than 5,000 inhabitants. 9.Bonds of Virginia educational institutions.Bonds of any of the educational institutions of the Commonwealth that have been or may be authorized to be issued by the General Assembly. 10. Securities of the Richmond,Fredericksburg and Potomac Railroad Company. Stocks,bonds,and other securities of the Richmond,Fredericksburg and Potomac Railroad Company,including bonds or other securities guaranteed by the Richmond,Fredericksburg and Potomac Railroad Company. 11.Obligations of railroads.Bonds,notes,and other evidences of indebtedness,including equipment trust obligations,which are direct legal obligations of or which have been unconditionally assumed or guaranteed as to the payment of principal and interest by,any railroad corporation operating within the United States that meets the following conditions and requirements: a.The gross operating revenue of such corporation for the fiscal year preceding the making of such investment,or the average of the gross operating revenue for the five fiscal years next preceding the making of such investment,whichever of these two is the larger,shall have not been less than$10 million; b.The total fixed charges of such corporation,as reported for the fiscal year next preceding the making of the investment,shall have been earned an average of at least two times annually during the seven fiscal years preceding the making of the investment and at least one and one-half times during the fiscal year immediately preceding the making of the investment.The term"total fixed charges"as used in this subdivision and subdivision c shall be deemed to refer to the term used in the accounting reports of common carriers as prescribed by the regulations of the Interstate Commerce Commission;and c.The aggregate of the average market prices of the total amounts of each of the individual securities of such corporation junior to its bonded debt and outstanding at the time of the making of such investment shall be equal to at least two-thirds of the total fixed charges for such railroad corporation for the fiscal year next preceding the making of such investment capitalized at an annual interest rate of five percent. Such average market price of any one of such individual securities shall be determined by the average of the highest quotation and the lowest quotation of the individual security for a period immediately preceding the making of such investment,which period shall be the full preceding calendar year plus the then-expired portion of the calendar year in which such investment is made,provided that if more than six months of the calendar year in which such investment is made shall have expired,then such period shall be only the then- expired portion of the calendar year in which such investment is made,and provided further that if such individual security shall not have been outstanding during the full extent of such period,such period shall be deemed to be the length of time such individual security shall have been outstanding. 12.Obligations of leased railroads. Stocks,bonds,notes,other evidences of indebtedness,and any other securities of any railroad corporation operating within the United States,the railroad lines of which have been leased by a railroad corporation,either alone or jointly with other railroad corporations,whose bonds, notes,and other evidences of indebtedness shall,at the time of the making of such investment,qualify as 79 lawful investments for fiduciaries under the terms of subdivision 11,provided that the terms of such lease shall provide for the payment by such lessee railroad corporation individually,irrespective of the liability of other joint lessee railroad corporations,if any,in this respect,of an annual rental of an amount sufficient to defray the total operating expenses and maintenance charges of the lessor railroad corporation plus its total fixed charges,plus,in the event of the purchase of such a stock,a fixed dividend upon any issue of such stock in which such investment is made,and provided that if such investment so purchased shall consist of an obligation of definite maturity,such lease shall be one which shall,according to its terms, provide for the payment of the obligation at maturity or extend for a period of not less than 20 years beyond the maturity of such obligations so purchased,or if such investment so purchased shall be a stock or other form of investment having no definite date of maturity,such lease shall be one which shall,according to its terms,extend for a period of at least 50 years beyond the date of the making of such investment. 13.Equipment trust obligations.Equipment trust obligations issued under the"Philadelphia Plan"in connection with the purchase for use on railroads of new standard gauge rolling stock,provided that the owner,purchaser,or lessee of such equipment,or one or more of such owners,purchasers,or lessees,shall be a railroad corporation whose bonds,notes,and other evidences of indebtedness shall,at the time of the making of such investment,qualify as lawful investments for fiduciaries under the terms of subdivision 11, and provided that all of such owners,purchasers,or lessees shall be both jointly and severally liable under the terms of such contract of purchase or lease,or both,for the fulfillment thereof. 14.Preferred stock of railroads.Any preference stock of any railroad corporation operating within the United States,provided such stock and such railroad corporation meet the following conditions and requirements: a. Such stock shall be preferred as to dividends,such dividends shall be cumulative,and such stock shall be preferred as to assets in the event of liquidation or dissolution; b.The gross operating revenue of such corporation for the fiscal year preceding the making of such investment,or the average of the gross operating revenue for the five fiscal years next preceding the making of such investment,whichever of these two is the larger,shall have been not less than$10 million; c.The total fixed charges,as defined in subdivision 11 b,of such corporation,as reported for the fiscal year next preceding the making of such investment,plus the amount,at the time of making such investment,of the annual dividend requirements on such preference stock and any preference stock having the same or senior rank,such fixed charges and dividend requirements being considered the same for every year,shall have been earned an average of at least two and one-half times annually for the seven fiscal years preceding the making of such investment and at least two times for the fiscal year immediately preceding the making of such investment;and d.The aggregate of the average market prices of the total amount of each of the individual securities of such corporation,junior to such preference stock and outstanding at the time of the making of such investment,shall be at least equal to the par value of the total issue of the preference stock in question plus the total par value of all other issues of its preference stock having either the same rank as,or a senior rank to,the issue of such preference stock plus total fixed charges,as defined in subdivision 11 b,for such railroad corporation for the fiscal year next preceding the making of such investment capitalized at an annual interest rate of five percent. Such average market price of any one of such individual securities shall be determined in the same manner as prescribed in subdivision 11 c. 15.Obligations of public utilities.Bonds,notes,and other evidences of indebtedness of any public utility operating company operating within the United States,provided such company meets the following conditions and requirements: a.The gross operating revenue of such public utility operating company for the fiscal year preceding the making of such investment,or the average of the gross operating revenue for the five fiscal years next preceding the making of such investment,whichever of these two is the larger,shall have been not less than $5 million; b.The total fixed charges of such corporation,as reported for the fiscal year next preceding the making of the investment,shall have been earned,after deducting operating expenses,depreciation,and taxes,other than income taxes,an average of at least one and three-quarters times annually during the seven fiscal years preceding the making of the investment and at least one and one-half times during the fiscal year immediately preceding the making of the investment; c.In the fiscal year next preceding the making of such investment,the ratio of the total par value of the bonded debt of such public utility operating company,including the total bonded indebtedness of all its 80 subsidiary companies,whether assumed by the public utility operating company in question or not,to its gross operating revenue shall not be greater than four to one;and d. Such public utility operating company shall be subject to permanent regulation by a state commission or other duly authorized and recognized regulatory body. The term"public utility operating company"as used in this subdivision and subdivision 16 means a public utility or public service corporation(i)of whose total income available for fixed charges for the fiscal year next preceding the making of such investment at least 55 percent thereof shall have been derived from direct payments by customers for service rendered them;(ii)of whose total operating revenue for the fiscal year next preceding the making of such investment at least 60 percent thereof shall have been derived from the sale of electric power,gas,water,or telephone service and not more than 10 percent thereof shall have been derived from traction operations;and(iii)whose gas properties are all within the limits of one state,if more than 20 percent of its total operating revenues are derived from gas. 16.Preferred stock of public utilities.Any preference stock of any public utility operating company operating within the United States,provided such stock and such company meet the following conditions and requirements: a. Such stock shall be preferred as to dividends,such dividends shall be cumulative,and such stock shall be preferred as to assets in the event of liquidation or dissolution; b. The gross operating revenue of such public utility operating company for the fiscal year preceding the making of such investment,or the average of the gross operating revenue for the five fiscal years next preceding the making of such investment,whichever of these two is the larger,shall have been not less than $5 million; c. The total fixed charges of such public utility operating company,as reported for the fiscal year next preceding the making of such investment,plus the amount,at the time of making such investment,of the annual dividend requirements on such preference stock and any preference stock having the same or senior rank,such fixed charges and dividend requirements being considered the same for every year,shall have been earned,after deducting operating expenses,depreciation,and taxes,including income taxes,an average of at least two times annually for the seven fiscal years preceding the making of such investment and at least two times for the fiscal year immediately preceding the making of such investment; d. In the fiscal year next preceding the making of such investment,the ratio of the sum of the total par value of the bonded debt of such public utility operating company,the total par value of the issue of such preference stock,and the total par value of all other issues of its preference stock having the same or senior rank to its gross operating revenue shall not be greater than four to one;and e. Such public utility operating company shall be subject to permanent regulation by a state commission or other duly authorized and recognized regulatory body. 17. Obligations of the following telephone companies.Bonds,notes,and other evidences of indebtedness of American Telephone and Telegraph,Bell Atlantic,Bell South,Southwestern Bell,Pacific Telesis, Nynex,American Information Technologies,or U.S.West,and bonds,notes,and other evidences of indebtedness unconditionally assumed or guaranteed as to the payment of principal and interest by any such company,provided that the total fixed charges,as reported for the fiscal year next preceding the making of the investment,of such company and all of its subsidiary corporations on a consolidated basis shall have been earned,after deducting operating expenses,depreciation,and taxes,other than income taxes,an average of at least one and three-fourths times annually during the seven fiscal years preceding the making of the investment and at least one and one-half times during the fiscal year immediately preceding the making of the investment. 18.Obligations of municipally owned utilities.The stocks,bonds,notes,and other evidences of indebtedness of any electric,gas,or water department of any state,county,city,town,or district whose obligations would qualify as legal for purchase under subdivision 3,4,or 5,the interest and principal of which are payable solely out of the revenues from the operations of the facility for which the obligations were issued,provided that the department issuing such obligations meets the requirements applying to public utility operating companies as set out in subdivisions 15 a through c. 19.Obligations of industrial corporations.Bonds,notes,and other evidences of indebtedness of any industrial corporation incorporated under the laws of the United States or of any state thereof,provided such corporation meets the following conditions and requirements: a.The gross operating revenue of such corporation for the fiscal year preceding the making of such investment,or the average of the gross operating revenue for the five fiscal years next preceding the making of such investment,whichever of these two is the larger,shall have been not less than$10 million; 81 b.The total fixed charges of such corporation,as reported for the fiscal year next preceding the making of the investment,shall have been earned,after deducting operating expenses,depreciation,and taxes,other than income taxes,and depletion in the case of companies commonly considered as depleting their natural resources in the course of business,an average of at least three times annually during the seven fiscal years preceding the making of the investment and at least two and one-half times during the fiscal year immediately preceding the making of the investment; c.The net working capital of such industrial corporation,as shown by its last published fiscal year-end statement prior to the making of such investment,or in the case of a new issue,as shown by the fmancial statement of such corporation giving effect to the issuance of any new security,shall be at least equal to the total par value of its bonded debt as shown by such statement;and d.The aggregate of the average market prices of the total amounts of each of the individual securities of such industrial corporation,junior to its bonded debt and outstanding at the time of the making of such investment,shall be at least equal to the total par value of the bonded debt of such industrial corporation at the time of the making of such investment,such average market price of any one of such individual securities being determined in the same manner as prescribed in subdivision 11 c. 20.Preferred stock of industrial corporations.Any preference stock of any industrial corporation incorporated under the laws of the United States or of any state thereof,provided such stock and such industrial corporation meet the following conditions and requirements: a. Such stock shall be preferred as to dividends,such dividends shall be cumulative,and such stock shall be preferred as to assets in the event of liquidation or dissolution; b.The gross operating revenue of such corporation for the fiscal year preceding the making of such investment,or the average of the gross operating revenue for the five fiscal years next preceding the making of such investment,whichever of these two is the larger,shall have been not less than$10 million; c.The total fixed charges of such corporation,as reported for the fiscal year next preceding the making of such investment,plus the amount,at the time of making such investment,of the annual dividend requirements on such preference stock and any preference stock having the same or senior rank,such fixed charges and dividend requirements being considered the same for every year,shall have been earned,after deducting operating expenses,depreciation,and taxes,including income taxes,and depletion in the case of companies commonly considered as depleting their natural resources in the course of business,an average of at least four times annually for the seven fiscal years preceding the making of such investment and at least three times for the fiscal year immediately preceding the making of such investment; d.The net working capital of such industrial corporation,as shown by its last published fiscal year-end statement prior to the making of such investment,or,in the case of a new issue,as shown by the financial statement of such corporation giving effect to the issuance of any new security,shall be at least equal to the total par value of its bonded debt plus the total par value of the issue of such preference stock plus the total par value of all other issues of its preference stock having the same or senior rank;and e.The aggregate of the lowest market prices of the total amounts of each of the individual securities of such industrial corporation junior to such preference stock and outstanding at the time of the making of such investment shall be at least two and one-half times the par value of the total issue of such preference stock plus the total par value of all other issues of its preference stock having the same or senior rank plus the par value of the total bonded debt of such industrial corporation.Such lowest market price of any one of such individual securities shall be determined by the lowest single quotation of the individual security for a period immediately preceding the making of such investment,which period shall be the full preceding calendar year plus the then-expired portion of the calendar year in which such investment is made,and if such individual security shall not have been outstanding during the full extent of such period,such period shall be deemed to be the length of time such individual security shall have been outstanding. 21.Obligations of finance corporations.Bonds,notes,and other evidences of indebtedness of any finance corporation incorporated under the laws of the United States or of any state thereof,provided such corporation meets the following conditions and requirements: a.The gross operating income of such corporation for the fiscal year preceding the making of such investment,or the average of the gross operating income for the five fiscal years next preceding the making of such investment,whichever of these two is the larger,shall have been not less than$5 million; b.The total fixed charges of such corporation,as reported for the fiscal year next preceding the making of the investment,shall have been earned,after deducting operating expenses,depreciation,and taxes,other than income taxes,an average of at least two and one-half times annually during the seven fiscal years 82 preceding the making of the investment and at least two times during the fiscal year immediately preceding the making of the investment; c. The aggregate indebtedness of such finance corporation as shown by its last fiscal year-end statement,or, in the case of a new issue,as shown by the financial statement giving effect to the issuance of any new securities,shall be no greater than three times the aggregate net worth,as represented by preferred and common stocks and surplus of such corporation;and d.The aggregate of the average market prices of the total amounts of each of the individual securities of such fmance corporation,junior to its bonded debt and outstanding at the time of the making of such investment,shall be at least equal to one-third of the sum of the par value of the bonded debt plus all other indebtedness of such fmance corporation as shown by the last published fiscal year-end statement,such average market price of any one of such individual securities being determined in the same manner as prescribed in subdivision 11 c. 22.Preferred stock of fmance corporations.Any preference stock of any fmance corporation incorporated under the laws of the United States or of any state thereof,provided such stock and such corporation meet the following conditions and requirements: a. Such stock shall be preferred as to dividends,such dividends shall be cumulative,and such stock shall be preferred as to assets in the event of liquidation or dissolution; b.The gross operating income of such corporation for the fiscal year preceding the making of such investment,or the average of the gross operating income for the five fiscal years next preceding the making of such investment,whichever of these two is the larger,shall have been not less than$5 million; c.The total fixed charges of such fmance corporation,as reported for the fiscal year next preceding the making of such investment,plus the amount,at the time of making such investment,of the annual dividend requirements on such preference stock and any preference stock having the same or senior rank,such fixed charges and dividend requirements being considered the same for every year,shall have been earned,after deducting operating expenses,depreciation,and taxes,including income taxes,an average of at least three and one-half times annually for the seven fiscal years preceding the making of such investment and at least three times for the fiscal year immediately preceding the making of such investment; d.The aggregate indebtedness and par value of the purchased stock,both the issue in question and any issues equal or senior thereto,of such finance corporation as shown by its last published fiscal year-end statement,or,in the case of a new issue,as shown by the financial statement giving effect to the issuance of any new securities,shall be no greater than three times the aggregate par value of the junior securities and surplus of such corporation;and e.The aggregate of the lowest market prices of the total amounts of each of the individual securities of such fmance corporation junior to such preference stock and outstanding at the time of the making of such investment shall be at least equal to one-third of the sum of the par value of such preference stock plus the total par value of all other issues of preference stock having the same or senior rank plus the par value of the total bonded debt plus all other indebtedness of such fmance corporation as shown by the last published fiscal year-end statement,such lowest market price of any one of such individual securities being determined in the same manner as prescribed in subdivision 20 e. 23.Federal housing loans.First mortgage real estate loans insured by the Federal Housing Administrator under Title II of the National Housing Act. 24.Certificates of deposit and savings accounts.Certificates of deposit of,and savings accounts in,any bank,banking institution,or trust company,whose deposits are insured by the Federal Deposit Insurance Corporation at the prevailing rate of interest on such certificates or savings accounts;however,no such fiduciary shall invest in such certificates of,or deposits in,any one bank,banking institution,or trust company an amount from any one fund in his or its care which shall be in excess of such amount as shall be fully insured as a deposit in such bank,banking institution,or trust company by the Federal Deposit Insurance Corporation.A corporate fiduciary shall not,however,be prohibited by the terms of this subdivision from depositing in its own banking department,in the form of demand deposits,savings accounts,time deposits,or certificates of deposit,funds in any amount awaiting investments or distribution, provided that it shall have complied with the provisions of§§ 6.2-1005 and 6.2-1007,with reference to the securing of such deposits. 25.Obligations of International Bank,Asian Development Bank,and African Development Bank.Bonds and other obligations issued,guaranteed,or assumed by the International Bank for Reconstruction and Development,the Asian Development Bank,or the African Development Bank. 83 26.Deposits in savings institutions.Certificates of deposit of,and savings accounts in,any state or federal savings institution or savings bank lawfully authorized to do business in the Commonwealth whose accounts are insured by the Federal Deposit Insurance Corporation or other federal insurance agency; however,no such fiduciary shall invest in such shares of any one such association an amount from any one fund in his or its care which shall be in excess of such amount as shall be fully insured as an account in such association by the Federal Deposit Insurance Corporation or other federal insurance agency. 27.Certificates evidencing ownership of undivided interests in pools of mortgages.Certificates evidencing ownership of undivided interests in pools of bonds or negotiable notes directly secured by first lien deeds of trust or mortgages on real property located in the Commonwealth improved by single-family residential housing units or multi-family dwelling units,provided that(i)such certificates are rated AA or better by a nationally recognized independent rating agency;(ii)the loans evidenced by such bonds or negotiable notes do not exceed 80 percent of the fair market value,as determined by an independent appraisal thereof,of the real property and the improvements thereon securing such loans;and(iii)such bonds or negotiable notes are assigned to a corporate trustee for the benefit of the holders of such certificates. 28.Shares in credit unions.Shares and share certificates in any credit union lawfully authorized to do business in the Commonwealth whose accounts are insured by the National Credit Union Share Insurance Fund or the Virginia Credit Union Share Insurance Corporation,provided no such fiduciary shall invest in such shares an amount from any one fund in his or its care which shall be in excess of such amount as shall be fully insured as an account in such credit union by the National Credit Union Share Insurance Fund or the Virginia Credit Union Share Insurance Corporation. B.Whenever under the terms of this section the par value of a preference stock is required to be used in a computation,there shall be used instead of such par value the liquidating value of such preference stock in the case of involuntary liquidation,as prescribed by the terms of its issue,in the event that such liquidating value shall be greater than the par value of such preference stock;or in the event that the preference stock in question has no par value,then such liquidating value shall be used instead;or when such preference stock shall be one of no par value and one for which no such liquidating value shall have been so prescribed,then for the purposes of such computation the preference stock in question shall be deemed to have a value of$100 per share. C.When any security provided for in this section is purchased by a fiduciary and at the time of such purchase the statement for the preceding fiscal year of the corporation issuing the security so being purchased has not been published and is therefore not available,the statement of such corporation for the fiscal year immediately prior to such preceding fiscal year shall be considered the statement for such preceding fiscal year and shall have the same force and effect as the statement for the fiscal year preceding such purchase,provided the date of such purchase is not more than four months after the end of the last fiscal year of the corporation. D.In testing a new issue of securities under the provisions of this section,it shall be permissible,in determining the number of times that fixed charges or preferred dividend requirements have been earned,to use pro forma fixed charges or dividend requirements,provided the corporation or its corporate predecessor has been in existence for a period of not less than seven years. E.Investments made under the provisions of this section,if in conformity with the requirements of this section at the time such investments were made,may be retained even though they cease to be eligible for purchase under the provisions of this section,but shall be subject to the provisions of the Uniform Prudent Investor Act(§64.2-780 et seq.). 2012,c.614. §2.2-4600.Short title;definitions. This chapter may be cited as the"Local Government Investment Pool Act." (1980,c.538,§§2.1-234.1,2.1-234.3; 1996,c.77;2001,c.844.) §2.2-4601.Findings and purpose. A.The General Assembly finds that the public interest is served by maximum and prudent investment of public funds so that the need for taxes and other public revenues is decreased commensurately with the earnings on such investments.In selecting among avenues of investment,the highest rate of return, consistent with safety and liquidity,shall be the objective. 84 B.The purpose of this chapter is to secure the maximum public benefit from the investment of public funds,and,in furtherance of such purposes to: 1.Establish and maintain a continuing statewide policy for the deposit and investment of public funds; 2.Establish a state-administered pool for the investment of local government funds;and 3.Authorize treasurers or any other person collecting,disbursing,or otherwise handling public funds to invest such public funds either in accordance with Chapter 45 (§2.2-4500 et seq.)of this title or through the local government investment pool created by the chapter. C.The General Assembly fmds that the objectives of this chapter will best be obtained through improved money management,emphasizing the primary requirements of safety and liquidity and recognizing the different investment objectives of operating and permanent funds. (1980,c.538, § 2.1-234.2; 2001,c. 844.) §2.2-4602.Local government investment pool created. A.A local government investment pool is created,consisting of the aggregate of all funds from local officials handling public funds that are placed in the custody of the State Treasurer for investment and reinvestment as provided in this chapter. B.The Treasury Board or its designee shall administer the local government investment pool on behalf of the participating local officials subject to regulations and guidelines adopted by the Treasury Board. C.The Treasury Board or its designee shall invest moneys in the local government investment pool with the degree of judgment and care,under circumstances then prevailing,which persons of prudence, discretion,and intelligence exercise in the management of their own affairs,not for speculation,but for investment,considering the probable safety of their capital as well as the probable income to be derived. Specifically,the types of authorized investments for local government investment pool assets shall be limited to those set forth for local officials in Chapter 45(§2.2-4500 et seq.)of this title. D.A separate account for each participant in the fund shall be kept to record individual transactions and totals of all investments belonging to each participant.A monthly report showing the changes in investments made during the preceding month shall be furnished to each participant having a beneficial interest in the local government investment pool.Details of any investment transaction shall be furnished to any participant upon request. E.The Treasury Board or its designee shall administer and handle the accounts in the same manner as bond and sinking fund trust accounts. F.The principal and accrued income,and any part thereof,of each and every account maintained for a participant in the local government investment pool shall be subject to payment at any time from the local government investment pool upon request,subject to applicable regulations and guidelines.Accumulated income shall be remitted or credited to each participant at least quarterly. G.Except as provided in this section,all instruments of title of all investments of the local government investment pool shall remain in the custody of the State Treasurer.The State Treasurer may deposit with one or more fiscal agents or banks,those instruments of title he considers advisable,to be held in safekeeping by the agents or banks for collection of the principal and interest or other income,or of the proceeds of sale.The State Treasurer shall collect the principal and interest or other income from investments of the investment pool,the instruments of title to which are in his custody,when due and payable. (1980,c. 538, § 2.1-234.8; 1984,c.320; 1988,c. 834;2001,c. 844.) §2.2-4603.Investment authority. Subject to the procedures set forth in this chapter,any local official handling public funds may invest and reinvest any money subject to his control and jurisdiction in the local government investment pool established by§2.2-4602. (1980,c.538, § 2.1-234.4; 1988,c. 834;2001,c. 844.) §2.2-4604.Interfund pooling for investment purposes. Local officials handling public funds may effect temporary transfers among separate funds for the purpose of pooling amounts available for investment.This pooling may be accomplished through interfund 85 advances and other appropriate means consistent with recognized principles of governmental accounting provided that(i)moneys are available for the investment period required;(ii)the investment fund can repay the advance by the time needed; (iii)the transactions are fully and promptly recorded;and(iv)the interest earned is credited to the loaning or advancing jurisdiction. (1980,c.538, §2.1-234.6; 1981,c.583;2001,c. 844.) §2.2-4605.Powers of Treasury Board relating to the administration of local government investment pool. A.The Treasury Board shall have power to: 1.Make and adopt regulations necessary and proper for the efficient administration of the local government investment pool hereinafter created,including but not limited to: a. Specification of minimum amounts that may be deposited in the local government investment pool and minimum periods of time for which deposits shall be retained in such pool; b. Creation of a reserve for losses; c.Payment of administrative expenses from the earnings of such pool; d.Distribution of the earnings in excess of such expenses,or allocation of losses,to the several participants in a manner that equitably reflects the differing amounts of their respective investments and the differing periods of time for which such amounts were in the custody of the pool;and e.Procedures for the deposit and withdrawal of funds. 2.Develop guidelines for the protection of the local government investment pool in the event of default in the payment of principal or interest or other income of any investment of such pool,such guidelines to include the following procedures: a.Instituting the proper proceedings to collect the matured principal or interest or other income; b.Accepting for exchange purposes refunding bonds or other evidences of indebtedness at appropriate interest rates; c.Making compromises,adjustments,or disposition of matured principal or interest or other income as considered advisable for the purpose of protecting the moneys invested; d.Making compromises or adjustments as to future payments of principal or interest or other income considered advisable for the purpose of protecting the moneys invested. 3.Formulate policies for the investment and reinvestment of funds in the local government investment pool and the acquisition,retention,management,and disposition of investments of the investment pool. B. The Treasury Board may delegate the administrative aspects of operating under this chapter to the State Treasurer,subject to the regulations and guidelines adopted by the Treasury Board. C. Such regulations and guidelines may be adopted without complying with the Administrative Process Act (§2.2-4000 et seq.)provided that input is solicited from local officials handling public funds. Such input requires only that notice and an opportunity to submit written comments be given. (1980,c. 538,§ 2.1-234.7;2001,c. 844.) §2.2-4606.Chapter controlling over inconsistent laws;powers supplemental. Insofar as the provisions of this chapter are inconsistent with the provisions of any other law,the provisions of this chapter shall be controlling and the powers conferred by this chapter shall be in addition and supplemental to the powers conferred by any other law. (1980,c. 538,§2.1-234.9;2001,c. 844.) 86 List of Substantive Changes to Investment Policy Section VIII. 1 Reporting - New bullet 6: "Year-end reporting by Level input in accordance with GASB 72" Appendix A: - Statutory updates to Virginia Code §§ 2.2-4400, et seq. Appendix D: - Remove references to Duff& Phelps ratings Appendix D: - Wholesale updates to GFOA Best Practices. These updates are current through GFOA actions in 2020. Appendix E: - Statutory updates to Virginia Code §§ 2.2-4500, et seq. and §§ 2.2-4600, et seq. roS .�y� a r :t si t, - T 0 CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: A Resolution Approving a Contract Extension with the Commonwealth of Virginia MEETING DATE: March 2, 2021 • Background: The Commonwealth of Virginia, through its Department of Behavioral Health and Developmental Services (DBHDS), provides funding for Mental Health, Developmental, and Substance Use Disorder services through a performance contract with local community services boards (CSBs) and Behavioral Health Authorities. This contract specifies the services to be provided by a CSB, the costs of those services, and all revenues used to support the services, and it lists all state and federal statutory and regulatory requirements applicable to the CSB and contains outcome and performance measures for the CSB. Under the provisions § 37.2-509(A)(5) of the Code of Virginia, DBHDS requires localities to match a minimum of 10% of the total amount of state and local funds. The City of Virginia Beach exceeds this minimum. • Considerations: Pursuant to § 37.2-508 of the Code of Virginia, the contract provides a substantial amount of funding needed to maintain important CSB services. Due to the uncertainty of the impacts of COVID-19, DBHDS opted to extend the existing FY 2020 Performance Contract for the first six months of FY 2021, through December 31, 2020. This action was accepted and approved by the Council on September 1, 2020. DBHDS has since notified CSBs of its intent to extend the FY 2020 Performance Contract through the rest of FY 2021 (June 30, 2021). Thus, further Council action is required. This extension continues the previous six-month extension through the end of the fiscal year, and since the previous six-month extension annualized the requirements, the numbers herein are identical to the September 1, 2020, City Council item. The funding sources that support the $64,926,993 contract consist of: o $25,975,894 in total fee revenue; o $21,371,566 in local matching funds from the City; o $12,565,288 in revenue from the Commonwealth; o $2,045,532 in federal revenue; o $2,458,104 in revenue from other sources; and o $510,609 of regional funding from the Commonwealth paid directly to vendors on behalf of the Virginia Beach CSB. This contract extension was approved by the Virginia Beach CSB at a board meeting on February 26, 2021. • Public Information: This item will be advertised as part of the regular Council Agenda process. As required by law, the performance contract extension was made available for public comment for a period of 30 days. The 30-day window expired on February 22, 2021. • Attachments: Resolution; Exhibit A (Performance Contract Summary) Recommended Action: Approval Submitting Department/Agency: Human Services City Manager: /r0 1 A RESOLUTION APPROVING A CONTRACT EXTENSION 2 WITH THE COMMONWEALTH OF VIRGINIA 3 4 WHEREAS, the Virginia Department of Behavioral Health and Developmental 5 Services (VBHDS) provides funding for mental health, developmental, and substance 6 use disorder services through a performance contract with local community services 7 boards; 8 9 WHEREAS, the Virginia Beach Community Service Board exceeds the Code of 10 Virginia mandated minimum local match share for these services; 11 12 WHEREAS, due to the ongoing uncertainties and impacts of the COVID-19 13 pandemic, VBHDS opted to extend the terms of the FY 2019-20 Performance Contract 14 first for the first six months of FY 2020-21 and now again for the second six months of 15 FY 2020-21; and 16 17 WHEREAS, the Virginia Beach Community Service Board, at its February 26, 2021 18 meeting, approved the second six-month extension of the FY 2019-20 performance 19 contract between the Virginia Beach Community Service Board and Commonwealth of 20 Virginia; 21 22 NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF 23 VIRGINIA BEACH, VIRGINIA, THAT: 24 25 The City Council of Virginia Beach hereby approves the extension of the Fiscal 26 Year 2019-20 performance contract with the Commonwealth of Virginia, a summary of 27 which is attached as Exhibit A, for a period concluding June 30, 2021. Adopted by the Council of the City of Virginia Beach, Virginia on the day of , 2021. APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: Budget and Managem nt Services ey's Office CA15327 R-1 February 16, 2021 FY2021 And FY2022 Community Services Performance Contract FY 2021 Exhibit A: Resources and Services Virginia Beach Community Services Board Consolidated Budget(Pages AF-3 through AF-12) Funding Sources Mental Health Developmental Substance TOTAL (MH) Services (DV) Services Use Disorder (SUD) Services State Funds 9,321,400 837,953 2,405,935 12,565,288 Local Matching Funds 11,666,901 9,257,621 447,044 21,371,566 Total Fees 4,961,361 20,403,221 611,312 25,975,894 Transfer Fees In/(Out) 0 0 0 0 Federal Funds 315,522 0 1,730,010 2,045,532 Other Funds 1,337,959 323,300 796,845 2,458,104 State Retained Earnings 0 0 0 0 Federal Retained Earnings 0 0 0 Other Retained Earnings 0 0 0 0 Subtotal Ongoing Funds 27,603,143 30,822,095 5,991,146 64,416,384 State Funds One-Time 0 0 0 0 Federal Funds One-Time 0 0 0 Subtotal One-Time Funds 0 0 0 0 TOTAL ALL FUNDS 27,603,143 30,822,095 5,991,146 64,416,384 Cost for MH/DV/SUD Services 26,974,547 30,579,128 3,859,151 61,412,826 Cost for Emergency Services(AP-4) 2,855,188 Cost for Ancillary Services (AP-4) 658,979 Total Cost for Services, 64,926,993 Local Match Computation CSB Administrative Percentage Total State Funds 12,565,288 Administrative Expenses 7,482,897 Total Local Matching Funds 21,371,566 Total Cost for Services 64,926,993 Total State and Local Funds 33,936,854 Admin/Total Expenses 11.53% Total Local Match % 62.97% (Local/Total State+ Local) Report Date 7/2/2020 AF-1 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A:Resources and Services Virginia Beach Community Services Board Financial Comments Comment! MH Other Federal-CSB=$47,405 USDA Comment2 MH Total Regional=$12,500 Clinical Supervision Comment3 MH Other Funds$1,337,959=$24,860 Probation&Parole,$9,640 Records, Comment4 $26,692 Miscellaneous revenue,$10,200 Beach House Comment5 Snack Bar Receipts, $100,501 Anticipated PATH additional award, Comntent6 $916,066 Sheriffs Jail Initiative,$250,000 Retained for Complex Care Comment? DV Other Funds=$323,000 DARS,$300 Miscellaneous revenue Comment8 SA Other Federal-CSB=$12,791 Health Department HIV Comment9 SA Other Funds$796,845=$22,328 Miscellaneous revenue,$694,677 Anticipated Comment!° SOR award$25,200 Medically Monitored Services to Other Boards, Commend l $54,640 School Prevention Contract Comment12 Some capacities have been reduced due to COVID-19 impact Comment13 Commentl4 Comment15 Comment16 Commend l Comment18 Comment19 Comment20 Commentll Comment22 Comment23 Comment24 Comment25 Report Date 7/2/2020 AF-2 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A:Resources and Services Mental Health(MH)Services Virginia Beach Community Services Board Funding Sources Funds FEES MH Medicaid Fees 4,541,854 MH Fees:Other 419,507 Total MH Fees 4,961,361 MH Transfer Fees In/(Out) 0 MH Net Fees 4,961,361 FEDERAL FUNDS MH FBG SED Child&Adolescent(93.958) 225,019 MH FBG Young Adult SMI(93.958) 0 MH FBG SMI(93.958) 16,650 MH FBG SMI PACT(93.958) 0 MH FBG SMI SWVBH Board (93.958) 0 Total MH FBG SMI Funds 16,650 MH FBG Geriatrics(93.958) 0 MH FBG Peer Services (93.958) 0 Total MH FBG Adult Funds 16,650 MH Federal PATH(93.150) 26,448 MH Federal COVID Emergency Grant(93.665) MH Other Federal-DBHDS 0 MH Other Federal-COVID Support MH Other Federal-CSB 47,405 Total MH Federal Funds 315,522 STATE FUNDS Regional Funds MH Acute Care(Fiscal Agent) 0 MH Acute Care Transfer In/(Out) 0 Total MH Net Acute Care-Restricted 0 MH Regional DAP(Fiscal Agent) 0 MH Regional DAP Transfer In/(Out) 2,895 Total MH Net Regional DAP-Restricted 2,895 MH Regional Residential DAP-Restricted 0 MH Crisis Stabilization(Fiscal Agent) 0 MH Crisis Stabilization-Transfer In/(Out) 794,934 Total Net MH Crisis Stabilization-Restricted 794,934 MH Transfers from DBHDS Facilities(Fiscal Agent) 0 MH Transfers from DBHDS Facilities-Transfer In/(Out) 0 Total Net MH Transfers from DBHDS Facilities 0 MH Expanded Community Capacity(Fiscal Agent) 0 MH Expanded Community Capacity Transfer In/(Out) 302,709 Total MH Net Expanded Community Capacity 302,709 AF-3 Report Date 7/2/2020 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A:Resources and Services Mental Health(MH)Services Virginia Beach Community Services Board Funding Sources Funds MH First Aid and Suicide Prevention(Fiscal Agent) 0 MH First Aid and Suicide Prevention Transfer In/(Out) 0 Total MH Net First Aid and Suicide Prevention 0 MH STEP-VA Outpatient(Fiscal Agent) 347,895 MH STEP-VA Outpatient Transfer In/Out 12,500 Total Net MH STEP-VA Outpatient 360,395 MH STEP-VA Crisis(Fiscal Agent) 0 MH STEP-VA Crisis Transfer In/Out 0 Total Net MH STEP-VA Crisis 0 MH Forensic Discharge Planning(Fiscal Agent) 0 MH Forensic Discharge Planning Transfer In/(Out) 0 Total Net MH Forensic Discharge Planning 0 MH Permanent Supportive Housing(Fiscal Agent) 917,168 MH Permanent Supportive Housing Transfer In/(Out) 0 Total Net MH Permanent Supportive Housing 917,168 MH Recovery(Fiscal Agent) 0 MH Other Merged Regional Funds(Fiscal Agent) 1,468,833 MH State Regional Deaf Services(Fiscal Agent) 0 MH Total Regional Transfer In/(Out) 455,478 Total MH Net Unrestricted Regional State Funds 1,924,311 Total MH Net Regional State Funds 4,302,412 Children State Funds MH Child&Adolescent Services Initiative 338,661 MH Children's Outpatient Services 75,000 MH Juvenile Detention 111,724 Total MH Restricted Children's Funds 525,385 MH State Children's Services 25,000 MH Demo Proj-System of Care(Child) 0 Total MH Unrestricted Children's Funds 25,000 MH Crisis Response&Child Psychiatry(Fiscal Agent) 0 MH Crisis Response&Child Psychiatry Transfer In/(Out) 119,369 Total MH Net Restricted Crisis Response&Child Psychiatry 119,369 Total State MH Children's Funds'Restricted for Children) 669,754 Other State Funds MH Law Reform 397,790 MH Pharmacy-Medication Supports 29,949 MH Jail Diversion Services 241,670 MH Rural Jail Diversion 0 AF-4 Report Date 7/2/2020 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services Mental Health(MH)Services Virginia Beach Community Services Board Funding Sources Funds MH Docket Pilot JMHCP Match 0 MH Adult Outpatient Competency Restoration Services 0 MH CIT-Assessment Sites 348,668 MH Expand Telepsychiatry Capacity 0 MH PACT 850,000 MH PACT-Forensic Enhancement 200,000 MH Gero-Psychiatric Services 0 MH STEP-VA-SDA,Primary Care Screening,Ancillary Services,and 467,129 Clinicians Crisis MH Young Adult SMI 0 Total MH Restricted Other State Funds 2,535,206 MH State Funds 1,814,028 MH State NGRI Funds 0 MH Geriatrics Services 0 Total MH Unrestricted Other State Funds 1,814,028 Total MH Other State Funds 4,349,234 TOTAL MH STATE FUNDS 9,321,400 MH Other Funds 1,337,959 MH Federal Retained Earnings 0 MH State Retained Earnings 0 MH State Retained Earnings-Regional Programs 0 MH Other Retained Earnings 0 Total MH Other Funds 1,337,959 LOCAL MATCHING FUNDS MH Local Government Appropriations 11,666,901 MH Philanthropic Cash Contributions 0 MH In-Kind Contributions 0 MH Local Interest Revenue 0 Total MH Local Matching Funds 11,666,901 Total MH Funds 27,603,143 MH ONE TIME FUNDS MH FBG SMI(93.958) 0 MH FBG SED Child&Adolescent(93.958) 0 MH FBG Peer Services (93.958) 0 MH State Funds 0 MH One-Time Restricted State Funds 0 Total One Time MH Funds 0 Total MH All Funds 27,603,143 AF-5 Report Date 7/2/2020 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services Developmental Services(DV) Virginia Beach Community Services Board Funding Sources Funds FEES DV Medicaid DD Waiver Fees 7,290,354 DV Other Medicaid Fees 0 DV Medicaid ICF/IDD Fees 12,579,030 DV Fees:Other 533,837 Total DV Fees 20,403,221 DV Transfer Fees In/(Out) 0 DV NET FEES 20,403,221 FEDERAL FUNDS DV Other Federal-DBHDS 0 DV Other Federal-CSB 0 DV Other Federal-COVID Support 0 Total DV Federal Funds 0 STATE FUNDS DV State Funds 837,953 DV OBRA Funds 0 Total DV Unrestricted State Funds 837,953 DV Trust Fund(Restricted) 0 DV Rental Subsidies 0 DV Guardianship Funding 0 DV Crisis Stabilization(Fiscal Agent) 0 DV Crisis Stabilization Transfer In(Out) 0 DV Net Crisis Stabilization 0 DV Crisis Stabilization-Children(Fiscal Agent) 0 DV Crisis Stabilization-Children Transfer In(Out) 0 DV Net Crisis Stabilization-Children 0 DV Transfers from DBHDS Facilities(Fiscal Agent) 0 DV Transfers from DBHDS Facilities-Transfer In/(Out 0 Total Net DV Transfers from DBHDS Facilities 0 Total DV Restricted State Funds 0 Total DV State Funds 837,953 AF-6 Report Date 7/2/2020 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services Developmental Services(DV) Virginia Beach Community Services Board Funding Sources Funds OTHER FUNDS DV Workshop Sales 0 DV Other Funds 323,300 DV State Retained Earnings 0 DV State Retained Earnings-Regional Programs 0 DV Other Retained Earnings 0 Total DV Other Funds 323,300 LOCAL MATCHING FUNDS DV Local Government Appropriations 9,255,377 DV Philanthropic Cash Contributions 2,244 DV In-Kind Contributions 0 DV Local Interest Revenue 0 Total DV Local Matching Funds 9,257,621 Total DV Funds 30,822,095 DV ONE TIME FUNDS DV One-Time Restricted State Funds 0 Total One Time DV Funds 0 Total DV All Funds 30,822,095 AF-7 Report Date 7/2/2020 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibl;o-,: Resources and Services Substance Use Disorder(SUD)Services Virginia Beach Community Services Board Funding Sources Funds FEES SUD Medicaid Fees 609,855 SUD Fees:Other 1,457 Total SUD Fees 611,312 SUD Transfer Fees In/(Out) 0 SUD NET FEES 611,312 FEDERAL FUNDS SUD FBG Alcohol/Drug Treatment(93.959) 985,968 SUD FBG SARPOS(93.959) 65,231 SUD FBG Jail Services (93.959) 165,147 SUD FBG Co-Occurring(93.959) 34,574 SUD FBG New Directions(93.959) 0 SUD FBG Recovery(93.959) 0 SUD FBG MAT-Medically Assisted Treatment(93.959) 0 Tota SUD FBG Alcohol/Drug Treatment Funds 1,250,920 SUD FBG Women(includes LINK at 6 CSBs)(93.959) 187,279 Total SUD FBG Women Funds 187,279 SUD FBG Prevention(93.959) 279,020 SUD FBG Prey-Family Wellness(93.959) 0 Total SUD FBG Prevention Funds 279,020 SUD Federal VA Project LINK/PPW(93.243) 0 SUD Federal Strategic Prevention(93.243) 0 SUD Federal COVID Emergency Grant(93.665) 0 SUD Federal YSAT—Implementation(93.243) 0 SUD Federal OPT-R-Prevention(93.788) 0 SOD Federal OPT-R-Treatment(93.788) 0 SUD Federal OPT-R-Recovery(93.788) 0 Total SUD Federal OPT-R Funds(93.788) 0 SUD Federal Opioid Response—Recovery(93.788) 0 SUD Federal Opioid Response—Treatment(93.788) 0 SUD Federal Opioid Response—Prevention(93.788) 0 Total SUD Federal Opioid Response Funds(93.788) 0 SOD Other Federal-DBHDS 0 SUD Other Federal-CSB 12,791 SUD Other Federal-COVID Support 0 TOTAL SUD FEDERAL FUNDS 1,730,010 AF-8 Report Date 7/2/2020 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services Substance Use Disorder(SUD)Services Virginia Beach Community Services Board Funding Sources Funds STATE FUNDS Regional Funds SUD Facility Reinvestment(Fiscal Agent) 0 SUD Facility Reinvestment Transfer In/(Out) 476,036 Total SUD Net Facility Reinvestment 476,036 SUD Transfers from DBHDS Facilities(Fiscal Agent) 0 SUD Transfers from DBHDS Facilities-Transfer In/(Out) 0 Total Net SUD Transfers from DBHDS Facilities 0 SUD Community Detoxification(Fiscal Agent) 0 SUD Community Detoxification—Transfer In/(Out) 0 Total Net SUD Community Detoxification 0 SUD STEP-VA(Fiscal Agent) 0 SUD STEP-VA -Transfer In/(Out) 0 Total SUD Net STEP-VA-Restricted 0 Total SUD Net Regional State Funds 476,036 Other State Funds SUD Women(includes LINK at 4 CSBs)(Restricted) 1,800 SUD Recovery Employment 0 SUD MAT-Medically Assisted Treatment 130,000 SUD Peer Support Recovery 0 SUD Permanent Supportive Housing Women 0 SUD SARPOS 76,097 SUD Recovery 0 Total SUD Restricted Other State Funds 207,897 SUD State Funds 1,460,999 SUD Region V Residential 131,215 SUD Jail Services/Juvenile Detention 27,216 SUD HIV/AIDS 102,572 Total SUD Unrestricted Other State Funds 1,722,002 Total SUD Other State Funds 1,929,899 TOTAL SUD STATE FUNDS 2,405,935 OTHER FUNDS SUD Other Funds 796,845 SUD Federal Retained Earnings 0 SUD State Retained Earnings 0 SUD State Retained Earnings-Regional Programs 0 SUD Other Retained Earnings 0 Total SUD Other Funds 796,845 LOCAL MATCHING FUNDS SUD Local Government Appropriations 447,044 SUD Philanthropic Cash Contributions 0 AF-9 Report Date 7/2/2020 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services Substance Use Disorder(SUD)Services Virginia Beach Community Services Board Funding Sources Funds SUD In-Kind Contributions 0 SUD Local Interest Revenue 0 Total SUD Local Matching Funds 447,044 Total SUD Funds 5,991,146 SUD ONE-TIME FUNDS SUD FBG Alcohol/Drug Treatment (93.959) 0 SUD FBG Women(includes LINK-6 CSBs)(93.959) 0 SUD FBG Prevention(93.959) 0 SUD FBG Recovery(93.959) 0 SUD State Funds 0 Total SUD One-Time Funds 0 Total All SUD Funds 5,991,146 AF-10 Report Date 7/2/2020 FY2021 And FY2022 Community Services Performance Contract FY 2021 Exhibit A: Resources and Services Local Government Tax Appropriations Virginia Beach Community Services Board City/County Tax Appropriation Virginia Beach City 21,369,322 Total Local Government Tax Funds: 21,369,322 Report Date 7/2/2020 AF-11 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services Supplemental Information Reconciliation of Projected Resources and Core Services Costs by Program Area Virginia Beach Community Services Board MH DV SUD Emergency Ancillary Services Services Services Services Services Total Total All Funds(Page AF-1) 27,603,143 30,822,095 5,991,146 1111.11.1111111111 64,416,384 Cost for MH,DV,SUD, 26,974,547 30,579,128 3,859,151 2,855,188 658,979 64,926,993 Emergency,and Ancillary Services Difference 628,596 242,967 2,131,995 -2,855,188 -658,979 -510,609 Difference results from Other: 510,609 Explanation of Other in Table Above: DAP to be paid on behalf of VBCSB by WTCSB Report Date 7/2/2020 AF-12 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services CSB 100 Mental Health Services Virginia Beach Community Services Board Report for Form 11 Projected Numbers of Projected Projected Individuals Total Core Services Service Receiving Service Capacity Services Costs 310 Outpatient Services 30.17 FTEs 1721 $4,508,307 312 Medical Services 23.08 FTEs 2400 $4,011,098 350 Assertive Community Treatment 11.1 FTEs 109 $1,897,705 320 Case Management Services 56.31 FTEs 1400 $6,634,974 410 Day Treatment or Partial Hospitalization 12 Slots 100 $523,626 420 Ambulatory Crisis Stabilization Services 5 Slots 40 $268,156 425 Mental Health Rehabilitation 41 Slots 175 $1,729,775 460 Individual Supported Employment 3.95 FTEs 50 $435,768 510 Residential Crisis Stabilization Services 12 Beds 320 $2,858,390 551 Supervised Residential Services 32 Beds 40 $961,158 581 Supportive Residential Services 13.68 FTEs 149 $3,116,294 610 Prevention Services 0.2 FTEs $29,296 Totals 6,504 $26,974,547 Report Date 7/2/2020 AP-1 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services CSB 200 Developmental Services Virginia Beach Community Services Board Report for Form 21 Projected Numbers of Projected Projected Individuals Total Core Services Service Receiving Service Capacity Services Costs 312 Medical Services 0.5 FTEs 14 $85,861 320 Case Management Services 30.8 FTEs 931 $3,924,774 425 Developmental Habilitation 69 Slots 156 $4,197,250 465 Group Supported Employment 16 Slots 36 $717,536 460 Individual Supported Employment 10.7 FTEs 150 $966,958 501 Highly Intensive Residential Services(Community-Based ICF/ID Services) 47 Beds 47 $13,934,414 521 Intensive Residential Services 25 Beds 25 $3,406,449 551 Supervised Residential Services 7 Beds 7 $654,647 581 Supportive Residential Services 35.56 FTEs 62 $2,691,239 Totals 1,428 $30,579,128 Report Date 7/2/2020 AP-2 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services CSB 300 Substance Use Disorder Services Virginia Beach Community Services Board Report for Form 31 Projected Numbers of Projected Projected Individuals Total Core Services Service Receiving Service Capacity Services Costs 310 Outpatient Services 5.6 FTES 300 $776,235 335 Medication Assisted Treatment Services 0 FTEs 170 $864,243 320 Case Management Services 1.98 FTEs 65 $222,538 410 Day Treatment or Partial Hospitalization 9 Slots 85 $372,686 501 Highly Intensive Residential Services(Medically Managed Withdrawal Services) 4 Beds 150 $739,934 521 Intensive Residential Services 2 Beds 16 $65,231 610 Prevention Services 5.68 FTEs 1 $818,284 Totals 786 $3,859,151 Report Date 7/2/2020 AP-3 FY2021 And FY2022 Community Services Performance Contract FY2021 Exhibit A: Resources and Services CSB 400 Emergency and Ancillary Services Virginia Beach Community Services Board Report for Form 01 Projected Numbers of Projected Projected Individuals Total Core Services Service Receiving Service Capacity Services Costs 100 Emergency Services 23.23 FTEs 2825 $2,855,188 318 Motivational Treatment Services 0.25 FTEs 280 $43,776 390 Consumer Monitoring Services 2.88 FTEs 370 $382,621 720 Assessment and Evaluation Services 2.2 FTEs 1000 $232,582 Totals 4,475 $3,514,167 Report Date 7/2/2020 AP-4 FY2021 And FY2022 Community Services Performance Contract Table 2: Board Management Salary Costs Name of CSB: Virginia Beach Community Services Board FY2021 Table 2a: FY 2021 Salary Range Budgeted Tot. Tenure Management Position Title Beginning Ending Salary Cost (yrs) Executive Director $199,503.00 $199,503.00 $199,503.00 1.00 Table 2: Integrated Behavioral and Primary Health Care Questions 1. Is the CSB participating in a partnership with a federally qualified health center,free clinic, or local health department to integrate the provision of behavioral health and primary health care? No 2. If yes,who is the partner? 0 a federally qualified health center Name: O a free clinic Name: O a local health department, or Name: • another organization Name: 3.Where is primary health (medical)care provided? • on-site in a CSB program, E on-site at the primary health care provider,or • another site--specify: 4.Where is behavioral health care provided? • on-site in a CSB program, • on-site at the primary health care provider,or • another site--specify: Report Date 7/2/2020 AP-5 .. yl �VYN� CITY OF VIRGINIA BEACH AGENDA ITEM J ITEM: An Ordinance to Express City Council Support for the 2021 Ignite Seminar Series and the Disparity Forum and to Appropriate Funds in Furtherance of Same MEETING DATE: March 2, 2021 • Background: The City Council received the Disparity Study written report in January of 2019, and this report was followed by an oral presentation from the consultant, BBC Research on February 5, 2019. Based on the results of the Disparity Study, the City Council increased its aspirational goal for minority participation in City contracts to 12% in April. Councilmember Wooten initiated the Ignite Seminar Series that offered three public meetings in 2019. Councilmember Wooten continued the Ignite Seminar Series through 2020 and desires to further such efforts in 2021 . The Ignite Seminar Series in 2021 will include February events (Disparity Forum and Ignite Series), utilizing a previously appropriated donation from Cox, and Ignite Series events tentatively scheduled for June and November. • Considerations: The attached ordinance supports the 2021 Ignite Seminar Series and Disparity Forum. In furtherance of its support, the ordinance appropriates funds that were provided for the 2020 Ignite Seminar Series that lapsed at end of Fiscal Year 2019-20. To avoid a similar lapse issue at the end of Fiscal Year 2020-21 , the ordinance includes direction to the City Manager to include unspent amounts that were previously appropriated by the City Council for the 2019 and 2020 Ignite Seminar Series in the proposed FY 2021-22 Operating Budget to support events occurring after June 30, 2021 . • Public Information: Normal City Council agenda process. • Attachments: Ordinance Requested by Councilmember Wooten REQUESTED BY COUNCILMEMBER WOOTEN 1 AN ORDINANCE TO EXPRESS CITY COUNCIL SUPPORT 2 FOR THE 2021 IGNITE SEMINAR SERIES AND THE 3 DISPARITY FORUM AND TO APPROPRIATE FUNDS IN 4 FURTHERANCE OF SAME 5 6 WHEREAS, Councilmember Wooten initiated the Ignite Seminar Series in 2019 7 and continued this series in 2020, and such events encourage small business 8 participation in City contracts and efforts to address the disparities in City contracting that 9 were shown in the City's Disparity Study; 10 11 WHEREAS, of the amounts provided by City Council for Ignite Series 2020, an 12 amount of$2,325 was unspent at the close of Fiscal Year 2019-20, and the appropriation 13 for such funds lapsed; and 14 15 WHEREAS, Councilmember Wooten desires to continue the Ignite Seminar Series 16 in 2021 to include February events (Disparity Forum and Ignite Series) utilizing a 17 previously appropriated donation and Ignite Series events tentatively scheduled for June 18 and November; 19 20 NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY 21 OF VIRGINIA BEACH, VIRGINIA, THAT: 22 23 The City Council expresses its continued support for the Ignite Seminar Series and 24 Disparity Forum in 2021 because these events are vehicles and tools to address the 25 disparity identified by the Disparity Study. 26 27 The City Council hereby appropriates $2,325 from the fund balance of the General 28 Fund to Municipal Council for expenses associated with the Ignite Seminar Series and 29 Disparity Forum, and such funds are to offset expenses related to the Ignite Seminar 30 Series and Disparity Forum. 31 32 To allow the payment of costs associated with the 2021 Ignite Seminar Series that 33 occur after June 30, 2021, the City Manager is hereby directed to include unspent 34 amounts from previous appropriations in support of the 2019 and 2020 Ignite Seminar 35 Series in the proposed FY 2021-22 Operating Budget. Adopted by the Council of the City of Virginia Beach, Virginia, on the day of , 2021. Requires an affirmative vote by a majority of all of the members of City Council. APPROVED AS TO LEGAL SUFFICIENCY: City orney's Office CA15306 / R-1 / February 18, 2021 4c4,- :., ,..: --;...f, 'i , p, "W f :,,, .,.....,, ........ CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: An Ordinance Rescinding the Previous Award of Franchises to Bird Rides, Inc., Neutron Holdings, Inc., Skinny Labs, Inc., and VeoRide, Inc. and Directing the City Manager to Resolicit Proposals MEETING DATE: March 2, 2021 • Background: After an influx of scooters, the City Council tasked staff with the development of a stakeholder group to review shared mobility services. The staff conducted extensive outreach among various interested groups and provided periodic briefings to the Council. Based on this input, the City issued a request for proposals (RFP) on January 14, 2020. The RFP included the form of the franchise agreement, and each scooter company responding to the RFP acknowledged the agreement without taking issue with the terms and conditions thereof. The City staff recommended award of franchises to the four scooter companies that responded to the RFP. At its May 19, 2020 meeting, the City Council adopted ordinances to award four franchises. Subsequent to the City Council approval, the four scooter companies collectively objected to certain terms and conditions in the proposed franchise agreement. The City staff reviewed these objections and polled other Virginia localities with scooter franchises and permits. The City staff presented its findings to the City Council, and the City Council informally directed the cancellation of the awards and issuance of a new RFP using the same proposed franchise agreement in the January 2020 RFP. • Considerations: The attached ordinance formalizes the direction provided to City staff at the February 16, 2021 informal session briefing. The ordinance rescinds the previous approval of the franchises and directs the City Manager to resolicit proposals. Upon the completion of the solicitation process, the City Council will receive an update regarding the new solicitation. is Public Information: Normal City Council agenda process. • Recommendations: Adopt the attached ordinance. • Attachments: Ordinance Recommended Action: Approval Submitting Departure • Office of the City Manager,,Ve-2 ---------- City Manager: rto 1 AN ORDINANCE RESCINDING THE PREVIOUS AWARD 2 OF FRANCHISES TO BIRD RIDES, INC., NEUTRON 3 HOLDINGS, INC., SKINNY LABS, INC., AND VEORIDE, INC. 4 AND DIRECTING THE CITY MANAGER TO RESOLICIT 5 PROPOSALS 6 7 WHEREAS, the City Council adopted ordinances to award four franchises for the 8 non-exclusive use of public streets and rights-of-way at its May 19, 2020 meeting; 9 10 WHEREAS, the awards were made based upon representations in the proposals 11 of the four scooter companies that the scooter companies would enter into a franchise 12 agreement with the City based upon the proposed franchise agreement included in the 13 request for proposals; 14 15 WHEREAS, subsequent to the City Council approvals, the four scooter companies 16 collectively objected to certain terms and conditions in the proposed franchise agreement; 17 and 18 19 WHEREAS, after briefings from the City staff, the City Council has informally 20 provided direction to resolicit proposals. 21 22 NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF 23 VIRGINIA BEACH, VIRGINIA: 24 25 That the City Council hereby rescinds its previous award of franchises to Bird 26 Rides, Inc., Neutron Holdings, Inc., Skinny Labs, Inc., and VeoRide, Inc., and the City 27 Manager is directed to resolicit proposals for such franchises. Adopted by the Council of the City of Virginia Beach, Virginia, on this . day of , 2021. APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: City Manager's Office City A ney's Office CA15333 R-1 February 22, 2021 (' �1 CITY OF VIRGINIA BEACH AGENDA ITEM f ITEM: An Ordinance to Extend the Provisions of the Previously Adopted Ordinance to Ensure Continuity of Government During the COVID-19 Disaster MEETING DATE: March 2, 2021 • Background: On March 12, 2020, Governor Northam declared a state of emergency and disaster due to the COVID-19 Pandemic (the "Pandemic"). The next day, the City Manager declared a local emergency due to the Pandemic. In accordance with state law, the City Council on March 31 , 2020 adopted an ordinance to provide for the continuity of government during the Pandemic ("ORD-36141"). The ordinance includes authorization for electronic or virtual meetings of the City Council and its boards and commissions, as well as for other meetings of the City, including public bid openings. On April 7, 2020, the City Council amended ORD-36141 to provide for the holding of public hearings as required to enact the City's FY 2021 Operating Budget and CIP. ORD-36141 would have expired on September 30, 2020, or upon the Governor's declaration that the emergency had ended, whichever had occurred earlier. Because the Governor had not declared that the emergency has ended and because the Pandemic continued to threaten public health, the City Council on September 15, 2020 adopted an ordinance to extend the provisions of ORD-36141 for six additional months or upon declaration of the Governor that the emergency is ended, whichever occurred earlier. • Considerations: Although some public meetings of the City have been held in person since the emergency was declared by employing the use of masks and social distancing and by facilitating citizen participation in those meetings in person or via electronic means, the need continues for certain meetings to be held virtually, as the Pandemic continues to adversely impact the City and its residents. The attached ordinance extends the provisions of the previously adopted ordinance to ensure the continuity of government during the disaster and to authorize the required hearings for the City's FY2022 Operating Budget and CIP. This ordinance extends the provisions of ORD-36141 until the earlier of either a declaration by the Governor that the emergency is ended or six months from the date of the adoption of the ordinance. • Public Information: Normal agenda process. • Recommendations: Adopt the attached ordinance. • Attachments: Ordinance and ORD-36141 Recommended Action: Approval Submitting Department/Agency: Office of the City Manager VWCity Manager: 1 AN ORDINANCE TO EXTEND THE PROVISIONS OF THE 2 PREVIOUSLY ADOPTED ORDINANCE TO ENSURE 3 CONTINUITY OF GOVERNMENT DURING THE COVID-19 4 DISASTER 5 6 WHEREAS, on March 12, 2020, the Governor of the Commonwealth of Virginia, 7 in Executive Order Number Fifty-One, declared a state of emergency and disaster within 8 the Commonwealth of Virginia pursuant to Code of Virginia Section 44-146.16 of the Code 9 of Virginia; 10 11 WHEREAS, on March 13, 2020, the City Manager, as Director of Emergency 12 Management, declared a local emergency; 13 14 WHEREAS, Section 15.2-1413 of the Code of Virginia provides that 15 "notwithstanding any contrary provision of law, general or special, any locality, may, by 16 ordinance, provide a method to assure continuity in its government, in the event of an 17 enemy attack or other disaster. Such ordinance shall be limited in its effect to a period not 18 exceeding six months after any such enemy attack or disaster and shall provide for a 19 method of resumption of normal governmental authority by the end of the six-month 20 period (emphasis added)"; 21 22 WHEREAS, because of the emergency, the City Council on March 31, 2020 23 adopted an Ordinance to Ensure Continuity of Government During the COVID-19 24 Disaster ("ORD-36141"); 25 26 WHEREAS, ORD-36141 includes a finding by the City Council that the COVID-19 27 Pandemic is a disaster for purposes of Virginia Code § 15.2-1413 and authorization for 28 electronic or virtual meetings of the City Council and its boards and commissions, as well 29 as for other meetings, including public bid openings; 30 31 WHEREAS, on April 7, 2020, the City Council adopted an ordinance to amend 32 ORD-36141 to provide for the holding of public hearings as required to enact the City's FY 33 2021 Operating Budget and CIP; 34 35 WHEREAS, ORD-36141 included a sunset date of either September 30, 2020 or 36 upon declaration of the Governor that the emergency is ended, whichever occurs earlier; 37 38 WHEREAS, because the Governor had not declared that the emergency has 39 ended, and because the COVID-19 Pandemic continued to threaten public health, the 40 City Council on September 15, 2020 adopted an ordinance to extend the provisions of 41 ORD-36141 for six additional months or upon declaration of the Governor that the 42 emergency is ended, whichever occurs earlier; and 43 44 WHEREAS, since the adoption of ORD-36141, some public meetings of the City 45 have been held in person by employing the use of masks and social distancing and by 46 facilitating citizen participation in those meetings in person or via electronic means, but 47 the need continues for certain meetings and public hearings to be held virtually, as the 48 COVID-19 Pandemic continues to adversely impact the City and its residents; 49 50 NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY 51 OF VIRGINIA BEACH, VIRGINIA, THAT: 52 53 1. The City Council hereby extends the provisions of ORD-36141 until the earlier 54 of either a declaration by the Governor that the emergency in the Commonwealth is ended 55 or six months from the date of the adoption of this ordinance. 56 57 2. The following shall apply to the public hearings required to enact the City's 58 FY2022 Operating Budget and CIP: 59 60 a. The required hearings for the City's FY2022 Operating Budget and CIP shall 61 be held virtually and without a quorum of the Council assembled at a given place; 62 63 b. Public comment may be solicited by electronic means in advance and shall 64 also be solicited through telephonic or other electronic means during the course of each 65 hearing. All such public comments will be provided to members of the Council before or 66 during the virtual meeting and made part of the record for such meeting; and 67 68 c. The City Clerk shall cause notice of such hearings to be posted prominently 69 on the City's website, in addition to the notifications that will be published in the 70 newspaper in accordance with statutory requirements. Adopted by the Council of the City of Virginia Beach, Virginia, on the day of , 2021. APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: e f Office of the City Manager City Attorney's Office CA15332 R-2 February 22, 2021 (I R D .R . 36141 1 AN ORDINANCE TO ENSURE CONTINUITY OF 2 GOVERNMENT DURING THE COVID-19 DISASTER 3 4 WHEREAS, on March 12, 2020, the Governor of the Commonwealth of Virginia, 5 in Executive Order Number Fifty-One, declared in response to the COVID-19 public 6 health emergency a state of emergency and disaster within the Commonwealth of 7 Virginia, in accordance with Virginia Code § 44-146.16; 8 9 WHEREAS, on March 13, 2020, the City Manager, as Director of Emergency 10 Management, declared a local emergency; 11 12 WHEREAS, the impacts to public health, the City's economy, and the operation of 13 the City government are likely to be protracted and could last several months; 14 15 WHEREAS, there are actions which must be taken by the City in the next several 16 months which will, by law, require the action of the City Council but may not be conducted 17 in a physical setting because of the COVID-19 Pandemic; and 18 19 WHEREAS, Virginia Code§ 15.2-1413 provides that"notwithstanding any contrary 20 provision of law, general or special, any locality, may, by ordinance, provide a method to 21 assure continuity in its government, in the event of an enemy attack or other disaster. 22 Such ordinance shall be limited in its effect to a period not exceeding six months after any 23 such enemy attack or disaster and shall provide for a method of resumption of normal 24 governmental authority by the end of the six-month period"; 25 26 NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY 27 OF VIRGINIA BEACH, VIRGINIA, THAT: 28 29 1. The City Council finds the impacts of the COVID-19 Pandemic is a disaster for 30 purposes of§ 15.2-1413 of the Code of Virginia. 31 32 2. The City Council will meet in person when practicable, but because of the 33 possible exposure of meeting participants to the COVID-19 virus, the Council 34 may meet electronically, subject to the following restrictions. Such electronic 35 meetings must be conducted in accordance with Virginia Code § 2.2- 36 3708.2(A)(3), and the subject of such meetings may be only matters related to 37 the emergency or where a failure to act by the Council would result in 38 irrevocable public harm. Whether any particular action by the Council fits within 39 the description in the preceding sentence and the Virginia Code requirements 40 is a fact-specific determination to be made in consultation with the City 41 Attorney. Notices for such meetings shall be made on the City's website. 42 Meetings shall be conducted in a format that enables citizens to both observe 43 and, if practicable, participate in such meetings electronically. 44 45 3. Other City boards and commissions may meet electronically as necessary, but 46 any such meeting shall be subject to the restrictions set forth in Virginia Code 47 § 2.2-3708.2(A)(3) and in Section 2, supra. 48 49 4. The Council directs that any City meeting—other than meetings of public 50 bodies, which are addressed above—be held electronically in lieu of physical 51 gatherings if feasible. Public bid openings required by the Virginia Public 52 Procurement Act shall be held telephonically or electronically. Instructions on 53 how to participate shall be distributed prior to the start of any such meeting or 54 bid opening. 55 56 5. The provisions of this ordinance shall expire upon declaration by the Governor 57 that the emergency in the Commonwealth is ended,or on September 30, 2020, 58 whichever is earlier. 59 Adopted ted by the Council of the City of Virginia Beach, Virginia, on the day of CYlar c , 2020. APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: j/Aa44441 ill ,---Z7,--ofe-t-rgo‘‘ k---- Office of the City Manager City Attorney's Office CA15043 R-1 March 24, 2020 / ., 1 M, III mil v � CITY OF VIRGINIA BEACH AGENDA ITEM / ITEM: An Ordinance to Extend the Sunset Date of Article III, Division 5 of Chapter 21 of the City Code Pertaining to Residential Permit Parking in the Historic Cavalier Shores Neighborhood MEETING DATE: March 2, 2021 a Background: In 2019, the City Council approved a one-year temporary residential parking program in the Historic Cavalier Shores Neighborhood in response to concerns raised by the Cavalier Shores Civic League and its residents regarding on- street public parking on the 200 blocks of 43rd, 44th, and 45th streets. The civic league was concerned about extended periods of high parking occupancy on these streets during both daytime and nighttime hours as a result of a nearby multi-year hotel construction project. This area is also used for parking by residents and beachgoers. The pilot program has been successful, and because construction of the hotel project continued, the City Council last year approved a one-year extension of the program to April 5, 2021. a Considerations: Construction of the hotel project has not been completed, so the residents have requested an additional extension of the program. This ordinance would extend the program to April 5, 2022. • Public Information: Information regarding this ordinance will be provided through the normal agenda process. • Attachments: Ordinance and Civic League Request Letter. Submitting Department/Agency: Strategic Growth Area Office/Planning Department City Manager: (tv2 1 AN ORDINANCE TO EXTEND THE SUNSET DATE OF 2 ARTICLE III, DIVISION 5 OF CHAPTER 21 OF THE CITY 3 CODE PERTAINING TO RESIDENTIAL PERMIT PARKING 4 IN THE HISTORIC CAVALIER SHORES NEIGHBORHOOD 5 6 WHEREAS, the Virginia Department of Historic Resources added the Cavalier 7 Shores Historic District, which is comprised of the Cavalier Shores neighborhood, to the 8 Virginia Landmarks Register, noting: 9 10 The Cavalier Shores Historic District in Virginia Beach began in 1927 as a 11 housing development sponsored by the city's now-iconic Cavalier Hotel, 12 which opened that same year. While the neighborhood's direct link to the 13 hotel has since faded, a brick promenade leading to a gate to the hotel 14 grounds recalls the earlier connection. Cavalier Shores is an example of 15 coastal suburban development during the first half of the 20th century. Its 16 dense housing dating to the era indicates the neighborhood's early 17 popularity and subsequent growth. Its seven blocks of houses are 18 predominated by Colonial Revival style designs, with Tudor Revival and 19 Minimal Traditional. Lining the neighborhood's alleyways are a complement 20 of rear garages and guesthouses, the latter a common feature of coastal 21 developments of the era. The district also conveys a sense of beautification 22 and landscaping, a defining aspect of the neighborhood since the 1920s. 23 Most of the district's lots were developed by the late 1960s. Today, Cavalier 24 Shores is a rare collection of early-20th century residential architecture in 25 Virginia Beach. 26 27 WHEREAS, the Cavalier Shores Historic District also is listed in the National 28 Register of Historic Places; 29 30 WHEREAS, as noted by the Virginia Department of Historic Resources, Cavalier 31 Shores is a unique area that consists of"dense housing" dating to an era when driveways 32 were less common, and current residents of Cavalier Shores require on-street parking for 33 their vehicles; 34 35 WHEREAS, the ability of the residents to park their vehicles on the street adjacent 36 to or near their homes has been severely impacted as a result of the multi-year 37 construction associated with the Cavalier Hotel project; 38 39 WHEREAS, the City Council desires to address the unique needs of this historic 40 neighborhood during the time of construction by extending for another year the one-year 41 temporary pilot program it previously established—separate and apart from the current 42 Residential Parking Permit Program—to continue to address the parking needs of 43 Cavalier Shores residents. 44 45 NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY 46 OF VIRGINIA BEACH, VIRGINIA: 85 Sec. 21-384. - Permits generally. 86 87 The City Treasurer or the city's parking management office shall issue residential parking 88 permits pursuant to this division in accordance with the procedures set forth in section 89 21-354. However, no permit shall be issued pursuant to this section for employee parking 90 in the Cavalier Shores Neighborhood. 91 92 BE IT FURTHER ORDAINED BY THE CITY COUNCIL OF THE CITY OF 93 VIRGINIA BEACH, VIRGINIA: 94 95 That the effective date of this ordinance shall be April 5, 2021, and that, absent 96 additional action by the City Council to the contrary, this ordinance shall automatically 97 sunset and expire on April 5, 2022. Adopted by the City Council of the City of Virginia Beach, Virginia, on this day of _, 2021. APPROVED AS TO CONTENT. APPROVED AS TO LEGAL SUFFICIENCY: Strategic Growth Area Office City Attomey's Office CA15326 R-2 February 18, 2021 The Historic Cavalier Shores Civi. League 214 44°" Street Virginia Beach,Virginia 23451 February 11, 2021 Patrick Duheney Municipal Center - Building 1 2401 Courthouse Drive City of Virginia Beach Virginia Beach, Virginia 23456 Dear Patrick, Or. March 15, 2019, the City Council approved a temporary parking program for the Cavalier Shores neighborhood, one of the few neighborhoods in Virginia Beach c=assified as "Historic" on the Virginia Historical Registry, This program limited parking by non-residents to three (3) hours per clay. The program was crr icalty needed because of the excessive parking demand created by the construction and hotel workers involved In the restoration and operation of the Historic Cavalier_ Given the 1920's road and neighborhood design In Cavalie- Shores, on street parking is required by a significant number of the residents. The neighborhood has always welcomed beach goers and other guests, but the commercial parking in the neighborhood brought on by the Cavalier project was overpowering the lim led on street parking. Tne parking program created by the City has worked wet to limit the duration ni erne that non•resiaents car,, park in Cavalier Shores, enabling residents to more often access parking in front of their own homes. Due to the ongoing construction at the Marriott, the condos and 'elated road work, in early 2020, the parking program was extended for another year. Currently, the construction of the new hotels,the condos and street alignment continues. creating the same, ff not increased, parking demands, Aod,tionally, the employees, the grounds w0'kers and guests of the two Motels seek daily para:.ng in Cavalier Shores. Fne&y., guests of the Cavalier Residences also park or the streets of Cavalier Shores due to the insufficient parking built into the oeveiopment of the Residences Due to the success of me parking program, we respectfully ask that it be continued for another year or indefinitely to address the continued parking shortfall caused by the hotels, Cavalier Residences, and the road realignment described above. Sincerely yours, • fe Bernice Pope, Pre±srient, Historic Cavalier Shores Civic League s4 �� CITY OF VIRGINIA BEACH AGENDA ITEM j ITEM: An Ordinance to Authorize a Grant of up to $150,000 to the Oceana Volunteer Fire Department, Inc. (OVFD) for a Fire Support Vehicle and the Outfitting Thereof and to Donate a Truck to the OVFD MEETING DATE: March 2, 2021 • Background: The Oceana Volunteer Fire Department, Inc. was incorporated in 1948 and is the only remaining active volunteer fire organization within the City. The members of OVFD provide a variety of services to the Virginia Beach Fire Department and ultimately the citizens of the City. The OVFD volunteers provide an average of 16,000 man hours per year as volunteer support technicians and response to an average of 230 fires and other hazardous emergencies each year. OVFD needs a new fire support vehicle. The exact cost of the vehicle is not known at this time, but the OFVD has requested a grant from the City to assist in the costs of acquisition of this vehicle and the equipment and accessories required to outfit the vehicle. The City is statutorily authorized to provide grants to nonprofit rescue squads and fire departments that serve the residents of the City. In addition to the grant, the Virginia Beach Fire Department has a Ford F550 that was originally acquired in 2001. This truck is due to be replaced with a newer vehicle. The OVFD would use the truck in its Support Tech Program. This program is a group of volunteers that respond to emergency scenes including air refills, scene lighting, and rehab support for emergency responders. • Considerations: The attached ordinance authorizes a grant of up to $150,000 to assist in the purchase of the fire support vehicle, equipment, and accessories. The actual amount of the grant will be based on the specific total required for such purchases based as certified by the Fire Chief or designee. The source of funding for this grant is the City Council Special Pandemic and Vaccine Support Reserve, and if approved the Reserve will have a balance of $8.75 million. The ordinance also authorizes the donation of the Ford F550 to the OVFD Support Tech Program. • Public Information: Advertisement will be as part of the City Council agenda. • Recommendations: Adopt the attached ordinance. • Attachments: Ordinance; Disclosure Form REQUESTED BY THE CITY COUNCIL REQUESTED BY THE CITY COUNCIL 1 AN ORDINANCE TO AUTHORIZE A GRANT OF UP TO 2 $150,000 TO THE OCEANA VOLUNTEER FIRE 3 DEPARTMENT, INC. (OVFD) FOR A FIRE SUPPORT 4 VEHICLE AND THE OUTFITTING THEREOF AND TO 5 DONATE A TRUCK TO THE OVFD 6 7 WHEREAS, pursuant to Virginia Code § 15.2-953, the City may authorize grants 8 to a nonprofit rescue squad or fire department that serve to the residents of the City; 9 10 WHEREAS, the OVFD has a need to acquire a fire support vehicle and a grant 11 would be of assistance in this acquisition; 12 13 WHEREAS, the Virginia Beach Fire Department has a Ford F550 that was 14 originally acquired in 2001 and is due to be replaced; and 15 16 WHEREAS, the OVFD would like to use the Ford F550 in its Support Tech 17 Program; 18 19 NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF 20 VIRGINIA BEACH, VIRGINIA: 21 22 That the grant in an amount not to exceed $150,000 is hereby authorized for the 23 OVFD for the purchase of a fire support vehicle and the equipment and accessories 24 necessary to outfit the vehicle. The source of funds is the City Council Special Pandemic 25 and Vaccine Support Reserve. The actual amount of the grant shall be based on the 26 specific total required for the purchases of the vehicle, equipment, and accessories as 27 certified by the Fire Chief or designee. 28 29 BE IT FURTHER ORDAINED, THAT: 30 31 The Ford F550, which is due to be replaced, is hereby donated to OVFD for use in 32 the Support Tech Program. Adopted by the Council of the City of Virginia Beach, Virginia on the _ day of , 2021. APPROVED AS TO LEGAL SUFFICIENCY: it rney's Office CA 15329 R-4 February 22, 2021 DISCLOSURE STATEMENT FORM The completion and submission of this form is required for all applications wherein such applicant may utilize certain service providers or financial institutions, and the City seeks to know of the existence of such relationships in advance of any vote upon such application. SECTION 1 / APPLICANT DISCLOSURE OCEANA VOLUNTEER FIRE DEPARTMENT Organization name: 1201 BAYNEDR VIRGINIA BEACH,VA 23454-281)1 SECTION 2. SERVICES DISCLOSURE Are any of the following services being provided in connection with the applicant? If the answer to any item is YES, please identify the firm or individual providing the service: YES NO SERVICE PROVIDER (use additional sheets if needed) Accounting and/or preparer of Richard H. Green CPA. PC 4856 Ifaguad Rd.. #103 your tax return Virginia Bea.:h. VA 23455 Financial Services (include Trw,t 6s s 121 lending/banking institutions and FKABrnch Banking&Trust Company current mortgage holders as 251n Woo=Boulevard SW applicable) Wi1,oc.NC 27893-4 26 ® Legal Services NONE LE Broker/Contractor/Engineer/Other NONE Service Providers CERTIFICATION: I certify that all of the information contained in this Disclosure Statement Form is complete, true, and accurate. I understand I am responsible for updating the information provided herein if it changes prior to the Council action upon this Application. J 1 (�_ ( ( Josh P. Swindell 2/18/2021 APPLICANT'S SIGNATURE PRINT NAME DATE 1-11 B'''• 2 4 hi r�-�,.... CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: An Ordinance to Appropriate Funds from the Auction of Surplus Equipment to the Plaza Volunteer Rescue Squad, Inc. MEETING DATE: March 2, 2021 • Background: The City, through the Department of Emergency Medical Services, facilitates the sale of surplus or end-of-life vehicles on behalf of the ten partner volunteer rescue squads. The City recently auctioned two vehicles on behalf of the Plaza Volunteer Rescue Squad, Inc., totaling $6,948.10. • Considerations: After the auction of surplus equipment on behalf of one or more rescue squads, the City has traditionally returned the proceeds to the rescue squad that owned the equipment. Accordingly, this request will appropriate funds from the auction to the Plaza Volunteer Rescue Squad, Inc., in the amount of $6,948.10. • Public Information: Normal Council Agenda process. • Attachment: Ordinance; Disclosure Form Recommended Action: Approval Submitting Department/Agency: Department of Emergency Medical Services City Manager: riv 1 AN ORDINANCE TO APPROPRIATE FUNDS FROM THE 2 AUCTION OF SURPLUS EQUIPMENT TO THE PLAZA 3 VOLUNTEER RESCUE SQUAD, INC. 4 5 WHEREAS, at the request of the Plaza Volunteer Fire Company and Rescue Squad, 6 Inc., which operates as the Plaza Volunteer Rescue Squad, Inc. (PVRS), the City recently 7 auctioned two vehicles formerly owned by PVRS; and 8 9 WHEREAS, the proceeds of the auction total $6,948.10; 10 11 NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF 12 VIRGINIA BEACH, VIRGINIA, THAT: 13 14 $6,948.10 is hereby appropriated, with miscellaneous revenue increased 15 accordingly, to the FY 2020-21 Operating Budget of the Department of Emergency Medical 16 Services for the purposes of providing such funds to PVRS. Adopted by the Council of the City of Virginia Beach, Virginia on the day of , 2021. Requires an affirmative vote by a majority of all of the members of City Council. APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: Budget and Management Services ey's Office CA15328 R-1 February 16, 2021 DISCLOSURE STATEMENT FORM The completion and submission of this form is required for all applications wherein such applicant may utilize certain service providers or financial institutions, and the City seeks to know of the existence of such relationships in advance of any vote upon such application. SECTION 1 / APPLICANT DISCLOSURE Organization name: PL. Z4 I0L 2EScues- 5(?(-46-0 SECTION 2. SERVICES DISCLOSURE Are any of the following services being provided in connection with the applicant? If the answer to any item is YES, please identify the firm or individual providing the service: YES NO SERVICE PROVIDER (use additional sheets if needed) n Accounting and/or preparer of 041 nS C Ar— your tax return Financial Services (include (I- - 0 lending/banking institutions and current mortgage holders as � �GI applicable) Legal Services in la I ❑ u Broker/Contractor/Engineer/Other n 1 a Service Providers CERTIFICATION; I certify that all of the information contained in this Disclosure Statement Form is complete, true, and accurate. I understand I am responsible for updating the information provided herein if it changes prior to the Council action upon this Application. c , Ka„,-i-r,(A,at," ' -a.A.P4z,tr- 407a PPLICANT'S I URE PRINT NAME DATE t I. PLANNING 1. QUAN LE for a Conditional Use Permit re short term rental at 1612 Tallwood Manor Court DISTRICT 1 - CENTERVILLE RECOMMENDATION: APPROVAL 2. JONATHAN WEST for a Conditional Use Permit re short term rental at 4814 Lake Drive DISTRICT 4—BAYSIDE RECOMMENDATION: APPROVAL 3. ALFRED NICOLL for a Conditional Use Permit re short term rental at 113 55th Street, Unit A DISTRICT 5 —LYNNHAVEN RECOMMENDATION: APPROVAL 4. KAREN AND JOE ALLEN / OLD HICKORY INVESTMENTS, LLC for a Conditional Use Permit re short term rental at 1361 Goose Landing DISTRICT 6—BEACH RECOMMENDATION: APPROVAL 5. BAO LO for a Conditional Use Permit re short term rental at 619 25th Street DISTRICT 6— BEACH RECOMMENDATION: STAFF—APPROVAL PLANNING COMMISSION—DENIAL 6. WILLIAM JOSEPH WRIGHT,JR. for a Conditional Use Permit re short term rental at 911 Pacific Avenue, Unit B DISTRICT 6—BEACH RECOMMENDATION: APPROVAL 7. D AND D CREATIONS, LLC /DANIEL AND KELLIE JO DAVID REVOCABLE TRUST for a Conditional Use Permit re short term rental at 2621 Highland Meadows Way DISTRICT 7—PRINCESS ANNE RECOMMENDATION: APPROVAL tea" °8. .4$: uli Z NOTICE OF PUBLIC HEARING In accordance with Virginia Code§2.2-3708.2,Virginia Code§15.2- 1413 and the City's Continuity of Government Ordinance adopted on September 15, 2020, and Chapter 1289 of the 2020 Acts of Assembly as amended,a Public Hearing of the Virginia Beach City Council will be held on Tuesday,March 2,2021 at 6:00 p.m.The City Council and required staff members will meet in person at the Convention Center,but at this time it is impractical and unsafe to allow other persons to attend the Council Meeting due to physical distancing and safety precautions related to the pandemic.Members of the public will be able to observe the Council Meeting through livestreaming on www.vbgov.com broadcast on VBTV Channel 47, and via WebEx through the link below.Citizens who wish to speak can sign up to speak either in person or electronically. Persons signed up to speak in person may wait in Suite 4 of the Convention Center until called into the meeting room to speak. In-person speakers will be required to follow physical distancing and safety protocols,including wearing a face covering while in the Convention Center. Citizens requiring accommodations to these requirements are encouraged to participate through electronic means or to contact the City Clerk to discuss accommodations. All interested parties are invited to participate by following the two-step process provided below.Due to the ongoing Covid-19 Pandemic, please check our website at www.vbgov.com/government/departments/city-clerk/city-council for the most updated meeting Information. Public comment is always welcome by the Council through their group e-mail account at citvcouncil@vbgov.com. The following requests are scheduled to be heard: Jonathan West(Applicant&Property Owner)Conditional Use Permit (Short Term Rental) Address: 4814 Lake Drive GPIN: 15704190144814 Council District Bays(de Alfred Nicoll (Applicant& Property Owner) Conditional Use Permit (Short Term Rental) Address: 113 55th Street Unit A GPIN: 24198034800001 Council District Lynnhaven Karen&Joe Allen(Applicant)Old Hickory Investments,LLC(Property Owner)Conditional Use Permit(Short Term Rental)Address:1361 Goose Landing GPIN:2417622261 Council District Beach Bao Lo(Applicant&Property Owner)Conditional Use Permit(Short Term Rental)Address:619 25th Street GPIN:2417898644 Council District Beach Quan Le(Applicant&Property Owner)Conditional Use Permit(Short Term Rental) Address: 1612 Tallwood Manor Court GPIN: 1465130874 Council District Centerville William Joseph Wright,Jr.(Applicant&Property Owner)Conditional Use Permit(Short Term Rental)Address:911 Pacific Avenue Unit B GPIN:24272444111030 Council District Beach D & D Creations, LLC (Applicant) Daniel David and Kellie David Revocable Trust(Property Owner)Conditional Use Permit(Short Term Rental)Address:2621 Highland Meadows Way GPIN:1484138836 Council District Princess Anne If you wish to make comments virtually during the public hearing, please follow the two-step process provided below: 1. Register for the WebEx at: rttos://vbgov.webex.com/vbgov/onstage/g.oh o?MTI D=e1a ba56b760743d7822e70c49e93a5a3d 2. Register with the City Clerk's Office by calling 757-385-4303 prior to 5:00 p.m.on March 2,2021. Copies of the proposed plans, ordinances, amendments and/or resolutions are on file and may be examined by appointment in the Planning Department at 2875 Sabre St,Suite 500,Virginia Beach,VA 23452 or online at www.vbgov.com/pc.For information call 757-385- 4621. If you require a reasonable accommodation for this meeting due to a disability,please call the City Clerk's Office at 757-385-4303.If you are hearing Impaired,you can contact Virginia Relay at 711 for TDD service.The meeting will be broadcast on cable TV,www.vbgov.com and Facebook Live. All interested parties are invited to participate. Amanda Barnes City Clerk BEACON-FEBRUARY 14&21,2021-1 TIME EACH Ny / t k / � . R5D R5D �. /411111111 / .4 /4''' / .f, , lit sAthe,, I I P 464t/;/ /// S /r "I( 741.1/4 ill <-9 ,,�� J R i 75 �R7� �ii\s , `� ���' 4 ......v, i c\) ( ) 01/ 4te. N lir i7N: N %///, Site Quan Le WA'aE Property_Polygons 1612 Tallwood Manor Court Zoning s Building imm.• imism Feet PLAN_TRANS_SURFACES 0 1530 60 90 120 150 180 / u \ - 449y- CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: QUAN LE [Applicant& Property Owner] Conditional Use Permit(Short Term Rental) for the property located at 1612 Tallwood Manor(GPIN 1465130874). COUNCIL DISTRICT — CENTERVILLE MEETING DATE: February 2, 2021 ■ Background: The applicant is requesting a Conditional Use Permit for Short Term Rental on a 10,114 square-foot parcel zoned R-7.5 Residential District. The lot consists of one single-family dwelling built in 2005 and contains six bedrooms. The minimum number of parking spaces required for the Short Term Rental is one per bedroom, or six spaces in this instance. The maximum occupancy for guests on-site after 11:00 p.m. for a six-bedroom Short Term Rental is 18; however, at the time of this writing, the applicant accepts City Council's recent Short Term Rental condition revisions reducing the number of overnight guests permitted to two per bedroom and limiting the number of bookings in a seven day period from two to one. These changes are reflected in the conditions below. • Considerations: This site is located within the Tallwood Manor subdivision, which consists of ten developed single-family residential building lots abutting Tallwood High School and Kempsville Road. Because this home contains six bedrooms, six off-street parking spaces are required. The applicant's parking plan depicts two of the required spaces within an existing garage and the remaining spaces within an existing driveway. As permitted by Section 241.2(1) of the City Zoning Ordinance, the Zoning Administrator deemed this plan as acceptable. All other requirements of Section 241.2 of the Zoning Ordinance pertaining to Short Term Rentals can reasonably be met by the applicant. Further details pertaining to this application are provided in the attached Staff Report. There is no known opposition to this request. The applicant submitted a petition of support signed by six residents of Tallwood Manor Court. • Recommendation: On January 13, 2021, the Planning Commission passed a motion to recommend this item on the Consent Agenda, passing a motion by a recorded vote of 10-0, to recommend approval of this request. Quan Lee Page 2 of 3 1 . The following conditions shall only apply to the dwelling unit addressed as 1612 Tallwood Court, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. The garage space within the unit must remain a minimum of 18-feet by 18-feet, contain a minimum 16-foot wide vehicle entryway opening, and shall remain free of materials to ensure vehicular accessibility to the Short Term Rental tenants. 4. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 5. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 6. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 7. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. Quan Lee Page 3 of 3 8. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 9. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 10.All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 11 .Accessory structures shall not be used or occupied as Short Term Rentals. 12.No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 13.The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 14.The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1 ,000,000) underwritten by insurers acceptable to the City. 15.There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 16.The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 17.To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. • Attachments: Staff Report and Disclosure Statements Location Map STR Vicinity Map Minutes of Planning Commission Hearing Petition of Support (1 - containing 6 signatures) Recommended Action: Staff recommends Approval. Planning Commission recommends Approval. Submitting Department/Agency: Planning Department City Manager: 0 Applicant & Property Owner Quan Le Agenda Item Planning Commission Public Hearing January 13, 2021 all\ City Council Election District Centerville 25 Virginia Beach Request Conditional Use Permit (Short Term Rental) Staff Recommendation 4,4 `r Approval a. a�a F s Staff Planner 4. e'ar` ,•°° % Summer Peebles �0�5 `4,, / � d. , s,� Mi bo �,o o e°o ' Location 1612 Tallwood Manor Court f • \Q T S'n GPIN 4 `' 1465130874 t, �°. Site Size `� ,� C ° 10,114 square feet , g °, f1 o "I " 4- = �. isc JJ\ / \ N. -I Existing Land Use and Zoning District Single-family dwelling/ R-7.5 Residential Surrounding Land Uses and Zoning Districts North • Tallwood Manor Court 4 Single-family dwellings/ R-7.5 Residential ` k° South e y!i 26th Y2 Street (alley) �`�` ° c Tallwood High School/ R-7.5 Residential _ - East Tallwood High School/R-7.5 Residential - ,. West .„ i Single-family dwellings/ R-7.5 Residential 0 z4 N. 410 `, .0 ♦ , 4 Quan Le Agenda Item 25 Page 1 Background & Summary of Proposal Site Conditions and History • This is a 10,114 square foot parcel zoned R-7.5 Residential District. • The subject dwelling was constructed in 2005. • Staff inspected the site on November 17, 2020 to observe site conditions and take photographs for this report. • On-street parking is permitted 24-hours per day,therefore any overflow parking beyond the minimum parking spaces required could occur within the public street. • The applicant accepts City Council's recently imposed conditions reducing the number of bookings in a seven- day period to one and limiting the overnight guest calculation to two per bedroom. Short Term Rentals in the Vicinity 4104#11111W gite 4 it ' ,# AN- 4 .44.,-_ -- .. --._=,.--4/.,* 4,44 to* . A.7._ 4044,u,..11,111 ,.,,,40_,„_,16,....,At T,40-et, . irveitil , • 7$4764".-74r4 it,4#40-1 A-F,A 444-44. .,,E.,,, , , 4,ft v 2\40,* .,, 0 . - , *a.4-, %. :144 46r.V1* 44.-41. 4t•• • #.114t* 14141.4441% ***4-ew **it ---4,e,,#4, v-**# 44fe 0 '***/4.el* '' Viliyar t • 4. ley V A'A‘ ' 1"S t . 4. VP. • - /* ;' 4! --41/11e4 avo STATUS 4• 46 �,.` $O 4 • 0 Denied ���o � 1041 00-&; 4 ill Map current as of 01.27.2021 Summary of Proposal The applicant submitted a Conditional Use Permit request to operate a Short Term Rental on the subject site.The regulations for Short Term Rental use are identified in Section 241.2 of the City Zoning Ordinance.Specific details pertaining to this application are listed below. • Number of bedrooms in the Short Term Rental:6 • Maximum number of guests permitted on the property after 11:00 pm: 12-As recommended in condition 16 • Number of parking spaces required (1 space per bedroom required): 6 Quan Le Agenda Item 25 Page 2 • Number of parking spaces provided on-site:6, however, 1 parking space is located partially in the right of way /r / R-50 • Zoning History # Request / j4,•• 1 SVR(Creation of 11-lot subdivision)Approved 10/29/2002 R — � 2 CRZ(R-7.5 Residential to Conditional R-5D Residential) MI Approved 05/27/2014 Application Types CUP—Conditional Use Permit MOD—Modification of Conditions or Proffers FVR—Floodplain Variance LUP—Land Use Plan REZ—Rezoning NON—Nonconforming Use ALT—Alternative Compliance STR—Short Term Rental CRZ—Conditional Rezoning STC—Street Closure SVR—Subdivision Variance Evaluation & Recommendation The site is located in the Tallwood Manor subdivision,which consists of single-family dwellings and is immediately adjacent to Tallwood High School. Short Term Rentals have not proven to be a common use in this area of the City. Six off-street parking spaces are required for this six-bedroom home.The applicant has submitted an alternative parking plan that shows two parking spaces in the garage with the remaining parking being accommodated in the driveway,with one stacked parking space encroaching two feet into the right-of-way.As the one space that encroach into the right-of- way does not block vehicular or pedestrian traffic,the Zoning Administrator has deemed this plan acceptable. Staff believes that all other requirements of Section 241.2 of the Zoning Ordinance pertaining to Short Term Rentals can reasonably be met.The applicant met with 7 out of 9 of the surrounding property owners in the subdivision.The applicant provided Staff with a petition from surrounding property owners containing 6 signatures. Based on the considerations above,Staff recommends approval of this request with the conditions listed below.The recommended conditions do reflect City Council's Short Term Rental revisions by reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Recommended Conditions 1. The following conditions shall only apply to the dwelling unit addressed as 1612 Tallwood Court, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. Quan Le Agenda Item 25 Page 3 3. The garage space within the unit must remain a minimum of 18-feet by 18-feet,contain a minimum 16-foot wide vehicle entryway opening,and shall remain free of materials to ensure vehicular accessibility to the Short Term Rental tenants. 4. This Conditional Use Permit shall expire five (5)years from the date of approval.The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however,the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints,violations of its conditions or violations of any building, housing,zoning,fire or other similar codes. 5. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two(2))on the property where the Short Term Rental is located.This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 6. The owner or operator must provide the name and telephone number of a responsible person,who may be the owner, operator or an agent of the owner or operator,who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 7. If, or when,the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a'through 'c' below.This information must be submitted to the Planning Department for review and approval.This shall be done within six(6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration;and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 8. To the extent permitted by state law,each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 9. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23-71 (noise),31-26,31-27 and 31-28 (solid waste collection), 12-5(fires on the beach), 12-43.2 (fireworks),and a copy of any approved parking plan. 10. All refuse shall be placed in automated refuse receptacles,where provided,and comply with the requirements of City Code sections 31-26, 31-27 and 31-28. 11. Accessory structures shall not be used or occupied as Short Term Rentals. 12. No signage shall be on-site,except one(1),four(4)square foot sign, may be posted on the building which identifies the Short Term Rental. 13. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7)day period. 14. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 15. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 16. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers")shall be two (2) individuals per bedroom. Quan Le Agenda Item 25 Page 4 17. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and,where natural gas or propane is present, carbon monoxide detectors,shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design(CPTED)concepts and strategies as they pertain to this site. Public Outreach Information Planning Commission • The applicant met with the neighbors on December 17, 2020 to discuss the details of the request. According to the applicant,they met with 7 of the 9 surrounding property owners in the subdivision.A petition of support was provided to Staff by the applicant as a result of this meeting,containing 6 signatures. • As required by the Zoning Ordinance,the public notice signs were placed on the property on or before December 14, 2020. • As required by State Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, December 27, 2020,and January 3, 2021. • As required by City Code,the adjacent property owners were notified regarding the request and the date of the Planning Commission public hearing on December 28, 2020. • This Staff report, as well as all reports for this Planning Commission's meeting,was posted on the Commission's webpage of www.vbgov.com/pc on January 7, 2021. City Council • As required by City Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, February 14,2021 and February 21, 2021. • As required by City Code,the adjacent property owners were notified regarding both the request and the date of the City Council's public hearing on February 15,2021 • The City Clerk's Office posted the materials associated with the application on the City Council website of https://www.vbgov.com/government/departments/city-clerk/city-council/Documents/BookmarkedAgenda.pdf on February 26, 2021. Quan Le Agenda Item 25 Page 5 Site Layout & Parking Plan 1$( 20 9' ' W ` 475.00' ii u-' -- 20D4 lw a0 , I Y 1221:"-ppRT _ s, 1N000 i FRAMEDFENCE I I SHED ` 5' PRIVATE l DRAINAGE ESN'T i I I l w2aci sT. 0033i 0050903 M 1LOT 4 I c i tI I pl LOT 3 N: J 'i1 I , M K u I I Ix i II I r . . Encroaches 0 ax 1. - . 1 2 feet into co* right-of- .. ri ht-of- CA • . - - - - • •3 4 5 I way 6. p. 8 feet fromiri - • -• 6 .11 COLUMN_ ipf property line f ' N _ _ .*06" s' OUT to street pavement Tallwood Manor Court Quan Le Agenda Item 25 Page 6 Site Photos 1 • f Fr I g ""!' • M aaaamuaalzii i���� ,41041111e alt" tt!!!!!! -s > /� slit` t7 qH ....r......4.----L__. , _ . . _. .... . . ,.. . . . ..._ ... .. �t 1 Quan Le Agenda Item 25 Page 7 Site Photos JT x�7ste�Tr inilliT - n :,:i.,•.110 if �-,s-.� , hal . l ,:,4f+^T' 1.t } ,' ,.. _. � y S 4 �� "ter'^3"�b. !k s *46 r srk E ,. • :p _ _ . s < / it' N.. - '� E s N Quan Le Agenda Item 25 Page 8 Disclosure Statement Disclosure Statement Cer iiA Mad �...,. Planning&Community ^, .. Development The disclosures contained in this form are necessary to inform public officials who may vote on the application as to whether they have a conflict of interest under Virginia law. The completion arid submission of this form is required for all applications that pertain to City real estate matters or to the development and/or use of property in the City of Virginia Beach requiring action by the City Council or a City board,commission or other body. Applicant Disclosure Applicant Name Does the applicant have a representative? ❑Yes wt No • if yes,list the name of the representative. Is the applicant a corporation,partnership,firm,business,trust or an unincorporated business?❑Yes No • If yes,list the names of all officers,directors,members,trustees,etc below. (Attach a fist it necessary) • If yes,list the businesses that have a parent-subsidiary'or affiliated business entity'relationship with the applicant. (Attach a list if necessary) '"Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation_" See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. '"Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(iii)there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a dose working relationship between the entities." See State and Local Government Conflict of Interests Act,Va. Code§2.2-3101. 11 Quan Le Agenda Item 25 Page 9 Disclosure Statement Disclosure Statement \143 ...-r• •.► [Tanning&Community Beve[opment Known Interest by Public Official or Employee Does an official or employee of the city of Virginia Beach have an interest in the subject land or any proposed development contingent on the subject public action?0 Yes czq No • If yes,what is the name of the official or employee and what is the nature of the interest? Applicant Services Disclosure 1. Does the applicant have any existing financing(mortgage,deeds of trust,cross-collaterafiration,etc)or are they considering any financing in connection with the subject of the application or any business operating or to be operated on the property? lq Yes ❑No • If yes,identify the financial institutions. 2. Does the applicant have a real estate broker/agent/realtor for current and anticipated future sales of the subject property? O Yes �,1 No • If yes,identify the real estate broker/reahor. 3. Does the applicant have services for accounting and/or preparation of tax returns provided in connection with the subject of the application or any business operating or to be operated on the property?0 Yes J No • If yes,identify the firm or individual providing the service. 4. Does the applicant have services from an architect/landscape architect/land planner provided in connection with the subject of the application or any business operating or to be operated on the property?0 Yes No • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?0 Yes „A No • If yes,identify the purchaser and purchaser's service providers. 2 � Quan Le Agenda Item 25 Page 10 Disclosure Statement Disclosure Statement Planning&Community Development 6. Does the applicant have a construction contractor in connection with the subject of the application or any business operating or to be operated on the property?❑Yes ®No • If yes,identify the construction contractor- 7. Does the applicant have an engineer/surveyor/agent in connection with the subject of the application or any business operating or to be operated on the property?❑Yes ®No • If yes,identify the engineer/surveyor/agent- 8. Is the applicant receiving legal services in connection with the subject of the application or any business operating or to be operated on the property?0 Yes l No • If yes,identify the name of the attorney or firm providing legal services. Applicant Signature 1 certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate- I understand that, upon receipt of notification that the application has been scheduled for public hearing,I am responsible for updating the information provided herein two weeks prior to the meeting of Nanning Commission,City Council,VBDA,CBPA,Wetlands Board or any public body or committee in connection with this application. L ill Applicant Signature Print Name and Title Date Is the applicant also the owner of the subject property? gl Yes 0 No • It yes,you do not need to fill out the owner disclosure statement. FOR CITY USE ONLY/All disclosures must be updated two(2)weeks prior to any Planning Commission and City Council meeting that pertains to the application No changes as of tie Q ' ertnttttae I SLAwvu,— /-e 31 Quan Le Agenda Item 25 Page 11 Next Steps • Upon receiving a recommendation from Planning Commission,this request will be scheduled for a City Council public hearing. Staff will inform the applicant and/or their representative of the date of the hearing in the upcoming days. • Following City Council's decision,the applicant will receive a decision letter from Staff. • Once the conditions of approval are in place and/or completed,the applicant must contact the Zoning Division of the Planning Department to obtain verification that the conditions have been met. Contact the Zoning Division at 757-385-8074. • If the request requires land disturbance and/or a subdivision of property, please contact the Development Services Center(DSC)to discuss next steps for site plan/plat review. Contact the DSC at 757-385-4621 or the Development Liaison Team at 757-385-8610. • Please note that further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/ Permits and Inspections Division,and the issuance of a Certificate of Occupancy,are required before any approvals allowed by this application are valid. • The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED)concepts and strategies as they pertain to this site. Quan Le Agenda Item 25 Page 12 STR VI CI ITY MAP QUAN LE - 1612 TALLWOOD MANOR CT -4 #4\ --i I 74N / ill , i4 - ' ''S# C(*# VW 7 4111111 ilk it :44„..4&40, Jij ;Aga i► . ;0 in Nis . _&cV4I4/ N ww:\. 4, - / 04Troip /11r4 .--, ,i -vir6..w. . ..,444".#40# /4 ..t. * 4,i, z -,: ', sf, -0-4 ,-;4 *- dp - "f•,.4, .4%441e, i *4 ,-. N4:44* . - , . . 0 44p#N ,,,,N-_. 4?- k,.. , 1 .44040, ,,,,'' A '4 . --. /4\* , 4.. '4:11460' IVO (‘ -v /N /4Ci 0*jelt, 40.4441\#4.1". , Ai ,(1r4. l'„40,40_,Allr .)771 sity V, 41)'''' Plitt°iT45,14 I 11-' - NeSt '"N:,k 406 : ,. tr PA tve %or crst*,-Asco, , r 44'..*qr ' * *ft ' , 1 , 's?-4 .741 rt',4 - " - /4" 4vo If0 ). . , I!, ,01040, V N /,. A Ap . # STATUS ♦♦� , .�--401k ',70,Wili. 1, r • Denied .,♦./ � litowlf• ♦; Under Review �. •• %� . ' ? �} Registered •�e�^ ♦ ,, .-- ��:r\ �� Items # 25 Quan Le [Applicant& Property Owner] Conditional Use Permit (Short Term Rental) 1612 Tallwood Manor Court January 13, 2021 RECOMMENDED FOR APPROVAL - CONSENT Mr. Weiner: Thank you. Our next order of business is the Consent Agenda, which the Vice Chair will take over. Mr. Wall: Okay, thank you Mr. Chair. These are applications that are recommended for approval by Staff and the Planning Commission concurred, and there are no speakers signed up in opposition. The Planning Commission places the following applications on the Consent Agenda. Application number 1, 4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20 with an amended condition or with an added condition concerning forested buffer. The Planning Commission also places the following applications for Conditional Use Permit for Short- Term Rental on the Consent Agenda as they meet the applicable requirements for Section 241 .2 of the Zoning Ordinance. Staff and the Planning Commission supports the applications, and there are no speakers signed up to comment. These include agenda items number 21, 23, 25, 26, and 27. Mr. Weiner: Thank you Commissioner Wall. Can I get a motion to approve the items on consent, please. Mr. Wall: I make a motion that these items be approved by consent. Ms. Klein: Second. Mr. Weiner: Okay. I got a approval by Commissioner Wall and a second by Ms. Klein, ready for vote. 1 Ms. Coleman: If you are in favor of the motion say, yes. And, if you are opposed say, no. Ms. Coleman: Mr. Alcaraz. Mr. Alcaraz: Yes. Ms. Coleman: Mr. Barnes is absent. Mr. Coston. Mr. Coston: Yes. Ms. Coleman: Mr. Graham. Mr. Graham: Yes. Ms. Coleman: Mr. Horsley. Mr. Horsley: Yes. Ms. Coleman: Mr. Inman. Mr. Inman: Yes. Ms. Coleman: Ms. Klein. Ms. Klein: Yes. Ms. Coleman: Mr. Redmond. Mr. Redmond: Yes. Ms. Coleman: Ms. Oliver. Ms. Oliver: Yes. Ms. Coleman: Vice Chair Wall. Mr. Wall: Yes. Ms. Coleman: And, Chairman Weiner. Mr. Weiner: Yes. Ms. Coleman: By record vote of 10 for and zero against, agenda items 1,4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20, with the added condition for the 20- 2 foot buffer, and 21, 23, 25, 26, and 27 have been approved on the Consent Agenda. AYE 10 NAY 0 ABS 0 ABSENT 1 Alcaraz AYE Barnes ABSENT Coston AYE Graham AYE Horsley AYE Inman AYE Klein AYE Oliver AYE Redmond AYE Wall AYE Weiner AYE CONDITIONS: 1. The following conditions shall only apply to the dwelling unit addressed as 1612 Tallwood Court, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241 .2 of the City Zoning Ordinance or as approved by City Council. 3. The garage space within the unit must remain a minimum of 18-feet by 18- feet, contain a minimum 16-foot wide vehicle entryway opening, and shall remain free of materials to ensure vehicular accessibility to the Short Term Rental tenants. 4. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 5. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is 3 located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 6. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty (30) minutes. Physical response to the site of the Short Term Rental is not required. 7. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 8. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 9. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 10. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 11. Accessory structures shall not be used or occupied as Short Term Rentals. 12. No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 13. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 14. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 4 15. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 16. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 17. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards. All applicable permits required by the City Code, including those administered by the Department of Planning / Development Services Center and Department of Planning / Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED) concepts and strategies as they pertain to this site. 5 f , , _. _ , Petition for supporting Short Term Rental4 , Owner of the property at 1612 Tallwood Manor Ct, VA Beach 23464 is proposing to use this respective Petition summary property as a short term rental. The purpose is to provide families and guests an alternate and different and background staying experience than the hotels/motels. The main focus is to serve the military families who come to this area for visiting service members and other families who want to explore the great area of Hampton Roads Action petitioned We, the undersigned acknowledge and support the proposed short term rental for , Print Name Signature Address Date ,+L L/ s- - ,C1/7 74-LL1 .i 14 .' C7. / /i&124' -/ /a(/1/Veve7e-i C/C'2,10 1,-i C(-- --- /4 t6//t m5-0 l'7 / r /1 t e if -t-kee 4,66Pai fre?,ee,-62 c c 7-7— \(-1 e_t4 1‘A ' ,.> 1:e6 7..."---'62: def4. 7:-.-C--, /6 57 24 h r /,_ /6,,tc„ ill-tt woo ct $44 a fI Ot Cockr--(' th z r I) 1 abe ctc k I, /16 ' • Vim. YN E,s( Wr4i.im , r`aNG /&Zv 1"4u-WUD flcwo, . C f 144- lemcz, ✓+ Z/Y6 y / /6-ZU i, R7.5 C] ee/A it / y ci bane �' // //-1 R5 R i , Z R5 R 1- rakii CVO i 7D I. __ _______ _ _, / , si. ______ dr - / R 4.z mileilli /' Ow/ Iliimommo. p AI -R— 5 mift 't 111) ��` o 007 C:3 ' ti I ------ - art /' IV Fir* ''' 401111110 "` a11 . "I 11/ i i g / II irs -. ► � t Lk* 8, ai? I 744. ** — 1 14011 pftfive i ce , 42, 1401.i. 4 "Cake or. _ o k , RSR /ye it• as Lake L m i� _ et R%5�R i �r��e 1 gl --------4,„___ 1 7_ / ii----, r----------, I I 1 B2 - -,Q,, 'w1 i = Site Jonathan West w 4 Property_Polygons 4814 Lake Drive Zoning Building Feet PLAN TRANS SURFACES 0 15 30 60 90 120 150 180 r4Q{+NtA�ICy. �4S �.+E'1 i7) 1 < ---- Fs; CITY OF VIRGINIA BEACH AGENDA ITEM 1 ITEM: JONATHAN WEST [Applicant & Property Owner] Conditional Use Permit (Short Term Rental) for the property located at 4814 Lake Drive (GPIN 15704190144814). COUNCIL DISTRICT — BAYSIDE MEETING DATE: March 2, 2021 • Background: The applicant is requesting a Conditional Use Permit for Short Term Rental on a 5,000 square-foot parcel zoned R-5R (SD) Residential District in the Shore Drive Overlay. The lot consists of one duplex and the applicant owns both units. The proposed Short Term Rental unit contains two bedrooms and the abutting unit, which is where the applicant resides, also contains two bedrooms. The minimum number of parking spaces required for the Short Term Rental is one per bedroom, or two spaces in this instance. The maximum occupancy for guests on-site after 11 :00 p.m. for a two-bedroom Short Term Rental is six; however, at the time of this writing, the applicant accepts City Council's recent Short Term Rental condition revisions reducing the number of overnight guests permitted to two per bedroom and limiting the number of bookings in a seven day period from two to one. These changes are reflected in the conditions below. • Considerations: This site is located within the Chesapeake Beach subdivision, which is home to a myriad of dwelling types. The subject lot is zoned R-5R and falls in the Shore Drive Overlay. In addition, the site lies approximately 2,100 feet from the public beach of the Chesapeake Bay. The applicant owns both dwelling units in this duplex building; however, the request is limited to the subject address. The applicant's parking plan depicts two required off-street parking spaces within the existing driveway, which meets Section 241 .2(1) of the City Zoning Ordinance. Furthermore, the requirements of Section 241.2 of the Zoning Ordinance pertaining to Short Term Rentals can be reasonably met by the applicant. Additional details pertaining to the application, as well as Staff's evaluation, are provided in the attached Staff Report. There are three letters of opposition associated with this request. The submitted letters focus on concerns relating to increased noise, on-street parking shortage, increased trash, the possibility of large gatherings, decreased neighbor privacy, and child safety as related to a rise in neighborhood traffic. Jonathan West Page 2 of 3 • Recommendation: On January 13, 2021 , the Planning Commission passed a motion to recommend this item on the Consent Agenda, passing a motion by a recorded vote of 10-0, to recommend approval of this request. 1. The following conditions shall only apply to the dwelling unit addressed as 4814 Lake Drive and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through `c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. Jonathan West Page 3 of 3 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10.Accessory structures shall not be used or occupied as Short Term Rentals. 11.No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12.The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13.The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14.There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15.The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16.To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. • Attachments: Staff Report and Disclosure Statements Location Map STR Vicinity Map Minutes of Planning Commission Hearing Letters of Opposition (3) Recommended Action: Staff recommends Approval. Planning Commission recommends Approval. Submitting Department/Agency: Planning Department *--/ City Manager: /V Applicant and Property Owner Jonathan West Agenda Item Planning Commission Public Hearing January 13, 2021 City Council Election District: Bayside 21 Virginia Beach Request Conditional Use Permit (Short Term Rental) Staff Recommendation \ o su�e' Approval Staff Planner c4 ej William Miller J Li ay eup/p'd pa'r /,, °4oQn4e��e4"," Z. Location Lo+ N 4814 Lake Drive (.727..„ j "� No.wyk Dries _rama. 4101ftyalilli ' ... GPIN v 15704190144814 CO Site Size '1'Sdde/ # . s 5,000 square feet = 411 °- (-('- 6 ad Hi A-._, 1 Existing Land Use and Zoning District `" Duplex dwelling/R-5R Residential (Shore Drive Overlay) Surrounding Land Uses and Zoning Districts . North - ,Pg ry . - 4' Zivo Court rid „-' ?.4,, ,. "3 Single-family dwellings/ R-5R Residential (Shore 14 Drive Overlay) South t Lake Drive � � '� / ,: -t r. . Duplex dwellings/ R-5R Residential (Shore Drive , • Overlay) 416 re, 4 f \ !� East : . Duplex dwelling/ R-5R Residential (Shore Drive s```111116 1 ti` `- , Overlay) -� � West i ' 1* •. ` &, `. t9' ,. N '1' a Semi-detached dwellings/ R-5R Residential x. `t 6E�r r (Shore Drive Overlay) .0 -4.` - ` -- or' ,� ck -c en' U - a Jonathan West Agenda Item 21 Page 1 Background & Summary of Proposal Site Conditions and History • This 5,000 square foot lot is located within the R-5R(SD) Residential District and contains one duplex building. Both units are owned by the applicant; however, he is only requesting the Conditional Use Permit for 4814 lake Drive. • According to City records,this home was constructed in 1993. • As per City records,the subject dwelling contains two bedrooms. • Staff inspected the site on November 17, 2020 to observe site conditions and take photographs for this report. • On-street parking is not permitted on this portion of Lake Drive. • No records of zoning violations relating to Short Term Rental use were found associated with the subject address. • The applicant accepts City Council's recently imposed conditions reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Short Term Rentals in the Vicinity 1� J a „.--;- 4 ° Va/ C **--.6,iiir \.i,---_-41-,_- f #41, •iirj2 b aIV ' G*. it, � 14 =a , �A ;• .4,,, 1111 1111 �L • M. ,.444 Yee_ �,Ii-�' rkir1/ At% STATUSir:t • ,t?is 0 Approved • .i •��r 7 Map updated on 01.27.2021 Summary of Proposal The applicant submitted a Conditional Use Permit request to operate a Short Term Rental on the subject site.The regulations for Short Term Rental use are identified in Section 241.2 of the City Zoning Ordinance. Specific details pertaining to this application are listed below. Jonathan West Agenda Item 21 Page 2 • Number of bedrooms in the Short Term Rental:2 • Maximum number of guests permitted on the property after 11:00 pm: 4-As recommended in condition#15 • Number of parking spaces required (1 space per bedroom required):2 • Number of parking spaces provided on-site:2 ---- y ---� 1.___..,....„.,___------------ �/ Zoning History 0 # Request .c}tie 2.e 1 REZ(B-2 to R-5R(PD-H2))Approved 11/23/1999 / 71111/ ; Cile* �' . . . f"---1 b.* 1 CUP—Conditional Use Permit MOD—Modification of Conditions or Proffers FVR—Floodplain Variance LUP—Land Use Plan REZ—Rezoning NON—Nonconforming Use ALT—Alternative Compliance STR—Short Term Rental CRZ—Conditional Rezoning STC—Street Closure SVR—Subdivision Variance Evaluation & Recommendation This site is located within the Chesapeake Beach subdivision,which is home to a myriad of dwelling types, including, but not limited to,single-family,duplex,and multi-family.The subject lot is zoned R-5R duplex district and falls in the Shore Drive Overlay. In addition,the site lies approximately 2,100 feet,or 0.39 miles,from the public beach of the Chesapeake Bay. For clarity,the applicant owns both dwelling units in this duplex building; however,the request is limited to this one unit. The applicant's parking plan depicts two required off-street parking spaces within the existing driveway,which meets Section 241.2(1)of the City Zoning Ordinance. Furthermore,the requirements of Section 241.2 of the Zoning Ordinance pertaining to Short Term Rentals can be reasonably met by the applicant. Based on the considerations above, Staff recommends approval of this request with the conditions listed below; however,the recommended conditions do reflect City Council's Short Term Rental revisions by reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Jonathan West Agenda Item 21 Page 3 Recommended Conditions 1. The following conditions shall only apply to the dwelling unit addressed as 4814 Lake Drive and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5)years from the date of approval.The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however,the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints,violations of its conditions or violations of any building, housing,zoning,fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two(2))on the property where the Short Term Rental is located.This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1(8a). 5. The owner or operator must provide the name and telephone number of a responsible person,who may be the owner,operator or an agent of the owner or operator,who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when,the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a'through 'c' below.This information must be submitted to the Planning Department for review and approval.This shall be done within six(6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration;and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law,each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23-71 (noise), 31-26,31-27 and 31-28 (solid waste collection), 12-5(fires on the beach), 12-43.2 (fireworks),and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles,where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31-28. 10. Accessory structures shall not be used or occupied as Short Term Rentals. 11. No signage shall be on-site,except one(1),four(4)square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7)day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars($1,000,000) underwritten by insurers acceptable to the City. Jonathan West Agenda Item 21 Page 4 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers")shall be two(2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and,where natural gas or propane is present, carbon monoxide detectors,shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design(CPTED)concepts and strategies as they pertain to this site. Public Outreach Information Planning Commission • As required by the Zoning Ordinance,the public notice sign(s)was placed on the property on December 14, 2020. • As required by State Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, December 27, 2020,and January 3, 2021. • As required by City Code,the adjacent property owners were notified regarding the request and the date of the Planning Commission public hearing on December 28, 2020. • This Staff report, as well as all reports for this Planning Commission's meeting,was posted on the Commission's webpage of www.vbgov.com/pc on January 7, 2021. City Council • As required by City Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, February 14, 2021 and February 21, 2021. • As required by City Code,the adjacent property owners were notified regarding both the request and the date of the City Council's public hearing on February 15,2021 • The City Clerk's Office posted the materials associated with the application on the City Council website of https://www.vbgov.com/government/departments/city-clerk/city-cou nci I/Documents/BookmarkedAgenda.pdf on February 26, 2021. Jonathan West Agenda Item 21 Page 5 Site Layout & Parking Plan L7f WOOD rfrcr O,'s`DE E 9' x 18' w000 parking space FE14Cf OUTSIDE o o R o r A Duplex o ?-SKJRYT 8P.z-,.Wi N coivonto vrui c i48!4 ,l48'1 t'°''�'` • .4 161 ' • • • :. • 101 • • • LAKE DRIVE (.50• k/w) Jonathan West Agenda Item 21 Page 6 Site Photos • ,. 4ue/ty( 1111 a r is - } y. - i' - - . _.. • ` - r a „e 4x _„: e 1 a • "........, .cL - _� M f� e a �i.. _14-1 . � '. . . '' ie It } :;u. ? Jonathan West Agenda Item 21 Page 7 Site Photos z e -,40.411:14 , ps,..'**:„,,,....,‘ . ., _ ...,r.,r,. ,,,,- g: z r ii - K Y P 3 !!" �j II ..--':All --. t3FF jj�� . j}' i�I_ -..- Jonathan West Agenda Item 21 Page 8 Floor Plan 28.00' ... i . - , BEDROOM BEDROOM r .�.�� lir V t I CLO$EI' a IHyA/" PAivr czosE7111 4 • "1 _ Il7Nl k`PTCHE"N - ,\r FL 4414.1 :_IP :`, a ri .,..........r -, r----- ri FIRST FLOOR PLAN Jonathan West Agenda Item 21 Page 9 Disclosure Statement r r :N 5 "'.�'�'ql�°-�•iil "?�� h iq • Planning&Community. Development The disclosures contained in this form are necessary to inform public officials who may vote on the application as to whether they have a conflict of interest under Virginia law. The completion and submission of this form is required for all applications that pertain to City real estate matters or to the development and/or use of property in the City of Virginia Beach requiring action by the City Council or a City board,commission or other body. Applicant Disclosure ��// �����ri� Applicant Name J I) dtJ'u t/` lcto �J- ra Does the applicant have a representative? ❑ Yes ra.fi • If yes,list the name of the representative. Is the applicant a corporation,partnership,firm,business,trust or an unincorporated business?❑Yes Ef No • If yes,list the names of all officers,directors,members,trustees,etc.below. (Attach a list if necessary) • If yes,list the businesses that have a parent-subsidiary'or affiliated business entity`relationship with the applicant. (Attach a list if necessary) "Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,VA.Code§2.2-310I. "Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(iii)there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a close working relationship between the entities." See State and Local Government Conflict of Interests Act,Va. Code§2.2-3101. 1 Jonathan West Agenda Item 21 Page 10 Disclosure Statement sdo• .,4*tement c,rr,rirAh•a Brea& Planning&Community Development Known Interest by Public Official or Employee Does an official or employee of the City of Virginia Beach ave an interest in the subject land or any proposed development contingent on the subject public action?❑Yes er'No • If yes,what is the name of the official or employee and what is the nature of the interest? Applicant Services Disclosure Does the applicant have any existing financing(mortgage,deeds of trust,cross-collateralization,etc)or are they considering any financingin connection with the subject of the application or any business operating or to be operated on the property? I51Yes ❑ No • If yes,identify the financial institutions. y 2. Does the apppllican ve a real estate broker/agent/realtor for current and anticipated future sales of the subject property? ❑Yes le,40 • If yes,identify the real estate broker/realtor. 3. Does the applicant have services for accounting and/or preparation of tax retums provided in connection with the subject of the application or any business operating or to be operated on the property?.L_�3."Yles 0 No • If yes,identify the firm or individual providing the service. Fran/ 5/z.ti/ /l- 4. Does the applicant have services from an architect/landscape architect/land planner provid n connection with the subject of the application or any business operating or to be operated on the property?❑Yes No • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?ElYes Lt!'NO • If yes,identify the purchaser and purchaser's service providers. 2 ) Jonathan West Agenda Item 21 Page 11 Disclosure Statement ' ` Disclosure Statement - ti -'-• .-- ` ,: ,- .' ` ' ie3 Planning&Community '` . Development 6. Does the applicant have a construction contractor in connection with the subject of the application or any business operating or to be operated on the property?0 Yes ©-IVO • If yes,identify the construction contractor. 7. Does the applicant have an engineer/surveyor/agent in connecti n with the subject of the application or any business operating or to be operated on the property?❑Yes Orlqo • If yes,identify the engineer/surveyor/agent. S. Is the applicant receiving legal services in coo pection with the subject of the application or any business operating or to be operated on the property?❑Yes Olio • If yes,identify the name of the attorney or firm providing legal services. Applicant Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing,I am responsible for updating the information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board or any public body or committee in connection with this application.ec 6 Applicant'Srna e [ii \/o iA/-how r A'S - E"-- Print Name and Title Io -- "I - ac' Date Is the applicant also the owner of the subject property? 12<eS 0 No • If yes,you do not need to fill out the owner disclosure statement. FOR CITY USE ONLY/All disclosures must be updated two(2)weeks prior to any Planning Commission and City Council meeting that pertains to the applications p No changes as of Date 02-01-2021 Signature W W2a wv M C,ller _ As per the applicant,there are no Print Name William Miller anticipated changes before the March 2, 2021 CC public hearing. Date:02-01-2020 31Pv. - Jonathan West Agenda Item 21 Page 12 Disclosure Statement ct Disclosure Statement '' }` ' ,� ` °' • Planning&Community tky-elo}intent Owner Disclosure - Owner Name Applicant Name V&riA-tit k t ZAS1- Is the Owner a corporation,partnership,firm,business,trust or an unincorporated business?❑Yes ❑-NO • If yes,list the names of all officers,directors,members,trustees,etc.below. (Attach a list if necessary) • If yes,list the businesses that have a parent-subsidiary3 or affiliated business entity'relationship with the Owner. (Attach a list if necessary) Known Interest by Public Official or Employee Does an official or employee of the City of Virginia Beach hp ve an interest in the subject land or any proposed development contingent on the subject public action?❑Yes iff4 o • If yes,what is the name of the official or employee and what is the nature of the interest? 3"Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. "Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(ili)there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a close working relationship between the entities." See State and Local Government Conflict of Interests Act,Va. Code§2.2-3101. 5I - Jonathan West Agenda Item 21 Page 13 Disclosure Statement • t�.w • ,�iyq Y ..a,ti� -� Disclosure Statement rxr rr N Planning R Community • DeVelaTaMerit Owner Services Disclosure 1. Does the Owner have any existing financing(mortgage,deeds of trust,cross-collateralization,etc)or are they considering any finpoing in connection with the subject of the application or any business operating or to be operated on the property? rEf Yes ❑ No • if yes,identify the financial institutions. p-Gn"t y rti14 c_ prime } Y?o 7/ 1 2. Does the Owner ha2,....,re a real estate broker/agent/realtor for current and anticipated future sales of the subject property? ❑Yes • If yes,identify the real estate broker/realtor. 3. Does the Owner have services for accounting and/or preparation of tax returns—rn/provided in connection with the subject of the application or any business operating or to be operated on the property?2'Yes ❑ No • If yes,identify the firmmr or individual providing the service. C,f 4 - 4. Does the Owner have services from an architect/landscape architect/land planner provided in connection with the subject of the application or any business operating or to be operated on the property?0 Yes No • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?❑Yes 1J41 • If yes,identify the purchaser and purchaser's service providers. 6. Does the Owner have a construction contractor i onnection with the subject of the application or any business operating or to be operated on the property?0 Yes No • If yes,identify the construction contractor. 7. Does the Owner have an engineer/surveyor/agent in nnection with the subject of the application or any business operating or to be operated on the property?0 Yes olalco • If yes,identify the engineer/surveyor/agent. 61 - Jonathan West Agenda Item 21 Page 14 Disclosure Statement Disclosure Statement Nt13 t+ve(9iyp a«� Planning&Community ...os,,.._ •a ..,�...,.a Development 8. Is the Owner receiving legal services in connVion with the subject of the application or any business operating or to be operated on the property?❑Yes o • If yes,identify the name of the attorney or firm providing legal services. Owner Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing,I am responsible for updating the information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board or any public body or committee In connection with this application.on Owner Signature% Print Name and Title -�-aa Date 71 Jonathan West Agenda Item 21 Page 15 Next Steps • Upon receiving a recommendation from Planning Commission,this request will be scheduled for a City Council public hearing. Staff will inform the applicant and/or their representative of the date of the hearing in the upcoming days. • Following City Council's decision,the applicant will receive a decision letter from Staff. • Once the conditions of approval are in place and/or completed,the applicant must contact the Zoning Division of the Planning Department to obtain verification that the conditions have been met. Contact the Zoning Division at 757-385-8074. • If the request requires land disturbance and/or a subdivision of property, please contact the Development Services Center(DSC)to discuss next steps for site plan/plat review. Contact the DSC at 757-385-4621 or the Development Liaison Team at 757-385-8610. • Please note that further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/ Permits and Inspections Division,and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. • The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED)concepts and strategies as they pertain to this site. Jonathan West Agenda Item 21 Page 16 tJa - - tl 4 is r tI H: i.11f.ft.ia0l-4 iilirir,l, • it fe + 0 �i Al or -b'�_ , e k. 4:04pAe _ /--_--/ strolir .,1_,amer a la ,. .. irr i ..7 r.`' 4��- 1 / .141014- -___., I I --71 _ .4:1- - „,..,.._41111,18* / C. .;;:•I i) 14i 0,1 /71 / 1 ifiii .,-.: I .; !/ 111,:amo. g eiiiii;_ar *Mir ' ,. Q :4!li t ' r .) if . Q fii 4ram ,, z r • ca ro- ' *1.' • , cu_ P b * 111".. 7, T5 ..,'1,,') c. 0 En Q a) 1" tri # 15- 0000[ "Er I- Items # 21 Jonathan West [Applicant & Property Owner] Conditional Use Permit(Short Term Rental) 4814 Lake Drive January 13, 2021 RECOMMENDED FOR APPROVAL - CONSENT Mr. Weiner: Thank you. Our next order of business is the Consent Agenda, which the Vice Chair will take over. Mr. Wall: Okay, thank you Mr. Chair. These are applications that are recommended for approval by Staff and the Planning Commission concurred, and there are no speakers signed up in opposition. The Planning Commission places the following applications on the Consent Agenda. Application numbers 1, 4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20 with an amended condition or with an added condition concerning forested buffer. The Planning Commission also places the following applications for Conditional Use Permit for Short- Term Rental on the Consent Agenda as they meet the applicable requirements for Section 241.2 of the Zoning Ordinance. Staff and the Planning Commission supports the applications, and there are no speakers signed up to comment. These include agenda items number 21, 23, 25, 26, and 27. Mr. Weiner: Thank you Commissioner Wall. Can I get a motion to approve the items on consent, please. Mr. Wall: I make a motion that these items be approved by consent. Ms. Klein: Second. 1 Mr. Weiner: Okay. I got a approval by Commissioner Wall and a second by Ms. Klein, ready for vote. Ms. Coleman: If you are in favor of the motion say, yes. And, if you are opposed say, no. Ms. Coleman: Mr. Alcaraz. Mr. Alcaraz: Yes. Ms. Coleman: Mr. Barnes is absent. Mr. Coston. Mr. Coston: Yes. Ms. Coleman: Mr. Graham. Mr. Graham: Yes. Ms. Coleman: Mr. Horsley. Mr. Horsley: Yes. Ms. Coleman: Mr. Inman. Mr. Inman: Yes. Ms. Coleman: Ms. Klein. Ms. Klein: Yes. Ms. Coleman: Mr. Redmond. Mr. Redmond: Yes. Ms. Coleman: Ms. Oliver. Ms. Oliver: Yes. Ms. Coleman: Vice Chair Wall. Mr. Wall: Yes. Ms. Coleman: And, Chairman Weiner. Mr. Weiner: Yes. 2 Ms. Coleman: By record vote of 10 for and zero against, agenda items 1,4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20, with the added condition for the 20- foot buffer, and 21, 23, 25, 26, and 27 have been approved on the Consent Agenda. AYE 10 NAY 0 ABS 0 ABSENT 1 Alcaraz AYE Barnes ABSENT Coston AYE Graham AYE Horsley AYE Inman AYE Klein AYE Oliver AYE Redmond AYE Wall AYE Weiner AYE CONDITIONS: 1. The following conditions shall only apply to the dwelling unit addressed as 4814 Lake Drive and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 3 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty (30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements `a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10. Accessory structures shall not be used or occupied as Short Term Rentals. 11. No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 4 15. The maximum number of persons on the property after 11 :00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards. All applicable permits required by the City Code, including those administered by the Department of Planning / Development Services Center and Department of Planning / Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED) concepts and strategies as they pertain to this site. 5 From: J-loa N.Dao To: William N.Miller Subject: FW:4812 Lake Dr.rezoning Date: Thursday,January 7,2021 11:09:35 AM Attachments: 1rnaae002.ong Will, See letter of opposition below for Item 21. Sincerely, Hoa N. Dao, Planner Ill hDao@VBGov.com 757.385.4298 11/4ABPlanning& Community From:Carol Gallagher<carolgallagher0l@gmail.com> Sent:Thursday,January 7, 2021 10:12 AM To: Hoa N. Dao<HDao@vbgov.com> Subject:4812 Lake Dr. rezoning CAUTION:This email originated from outside of the City of Virginia Beach.Do not click links or open attachments unless you recognize the sender and know the content is safe. To:Virginia Beach Zoning Board From: Carol and Todd Gallagher We oppose the rezoning of this property or any property located in Chesapeake Beach.This property, in particular, is on a narrow street with only driveway parking.There is barely enough driveway space for 2 cars per unit.There is no street parking. A short term rental will result in nothing more than a "Party"house. Most of the homes in this area are owner occupied. Can you imagine living next door to a unit with lots of different people coming and going all summer long? This is not the neighborhood for that and for those reasons we oppose the rezoning! Sincerely, Carol and Todd Gallagher 4959 Athens Blvd. Virginia Beach,VA 23455 757-761-8866 From: Susan Connors To: William N.Miller Subject: Re:Opposition to Use Exemption for 4812&4814 Lake Drive Date: Monday,January 11,2021 9:56:51 AM CAUTION:This email originated from outside of the City of Virginia Beach.Do not click links or open attachments unless you recognize the sender and know the content is safe. Wow! I'm really surprised that VB gov shared my letter with my neighbor. He just called me, apologizing for not letting me know that he is turning the lower unit into an Airbnb rental. He told me the person in my driveway was not connected to him. That's exactly what I would expect- he took no responsibility for the people on his property. I wasn't planning to speak at the hearing,but I will make every effort to do so. By the way,he said he wouldn't tell me what to do on my property. I'm not the one asking for a change in the zoning law. On Mon, Jan 11, 2021 at 7:24 AM William N. Miller<WNMiller@vbgov.com>wrote: Good morning, Thank you for your letter. It was saved and will be provided to the Planning Commissioners for their review. While the written word is good, citizen participation via virtual presence and vocal support/opposition at public hearings typically carry the most weight. If you would like to register to speak, please call 757-385-4621 AND register at https://www.vbgov.com/government/departments/planning/boards- commissions-committees/pages/pc.aspx Please let me know if I can be of further assistance. Will Miller Zoning Inspector III Short-Term Rental Team Planning Department Zoning Administration 2875 Sabre St. Suite 500 Virginia Beach,VA. 23452 757-385-5066(voicemail) From: Susan Connors<susanhconnors@gmail.com> Sent: Friday,January 8,2021 3:56:49 PM To: Hoa N. Dao<HDao@vbgov.com> Subject: Opposition to Use Exemption for 4812 & 4814 Lake Drive CAUTION:This email originated from outside of the City of Virginia Beach.Do not click links or open attachments unless you recognize the sender and know the content is safe. Dear Hoa N. Dao, My name is Susan Connors. I live at 4810 Lake Drive,Virginia Beach,VA 23455. I understand my nextdoor neighbor has requested a zoning exemption to allow for short term rentals. Since my neighbor did not bother to discuss his plans with me or ask my opinion about the situation, I feel I have no option but to STRENUOUSLY OBJECT to the request. On New Year's Eve, a visitor to the property parked in my driveway and continuously honked his horn for about 30 minutes. Upon departure,the visitor squealed out of the driveway,leaving tire ruts in the grassy strip shared between the two properties. Earlier this fall,the owner cut down all of the trees in the backyard,which provided a noise bather between the units and my bedroom window. Several times I have had to adjust the trash can so that it faced the street in the right direction and also wheel it back onto the owner's property when it was left abandoned in the middle of street. None of us will ever forget the trash left all over the beach by short term renters last Memorial Day! Lake Drive is a quiet street and Chic's Beach is a family neighborhood. Please don't let the new owner reduce our property values with his short term rentals. I tried to register for the hearing on January 13. I would be happy to repeat what is written above if I have an opportunity to comment. You can reach me at 757-962-0197 if you have any questions. Thank you. Susan H. Connors susanhconnors@gmail.com Susan H. Connors susanhconnors@gmail.c omn From: }ioa N.Dao To: William N.Miller Subject: FW:Opposition to CUP GPIN: 15704190144814 Date: Thursday,January 14,2021 11:16:03 AM Attachments: jmaoe002.onq For Item 18. To include with the ARF. Sincerely, Hoa N. Dao, Planner III hDao@VBGov.com 757.385.4298 Planning& Community From:Amanda Edwards<amanda.renee.2144@gmail.com> Sent:Wednesday,January 13, 2021 1:33 PM To: Hoa N. Dao<HDao@vbgov.com> Subject:Opposition to CUP GPIN: 15704190144814 CAUTION:This email originated from outside of the City of Virginia Beach.Do not click links or open attachments unless you recognize the sender and know the content is safe. Dear Mr. Dao, My name is Amanda Edwards and I am writing you today to express my concerns regarding an application for a Short Term Rental Permit at 4814 Lake Dr, in the Bayside council district. I attended today's call and was unable to speak as I misread the flyer I received and did not register to comment during the live public hearing. I hope my comments today will be considered. My home at 4812 Zivo Ct faces directly at the back side of this property.There are no homes that face us on the street. I have several concerns regarding the allowance of this permit and request that the owner NOT be issued a permit allowing for short term rental. 1. Our small culdasac on the backside of this property has only 7 homes which house 10 children. 5 of those children are under the age of 6. I personally have a 1 and 3 year old. Additionally there are several children on adjacent streets that regularly play with friends from Zivo Ct. I am concerned that allowing for a short term rental would increase parked cars and traffic on our very small culdasac endangering our children who rides bikes, scooters, play basketball, play with toys, etc on our culdasac. Unfamiliar drivers to this street are not conditioned to watch for these small children when moving cars in and out, or using our street as a turn around. 2.There is a large fenced in yard in the back of that property that invites large groups to gather and party while they"vacation" in a family oriented, residential neighborhood.This past summer the owner of this property cut down all trees inside this fence completely opening the space up without privacy. My concern is the noise we will hear from these groups as this home would surely attract young party goers to AirBnB in our quaint bay-front neighborhood.The brewery across the street will certainly be a selling point. My bedroom window faces this backyard and I am gravely concerned with the disruption noise will cause to our quiet neighborhood. 3. Our neighborhood is already inundated with traffic during summer months as local beach goers line our streets to go to the bay.While I understand this, as we have 3 public beach access points in our neighborhood, during these months we endure increased trash, drunk drivers, excessive traffic, and private property lined with cars from non residents. Allowing for short term rental sets the precedent in this neighborhood for more and more to pop up only creating additional traffic,trash, and danger to homeowners and property owners. We are a family friendly, quiet residential neighborhood and I do not think it is in the best interest of the homeowners to allow for this type of property use. Please vote no on a short term rental permit. Thank you for taking the time to hear my comments. Regards, Amanda Edwards o % H.1� _`� 4\ '1 1 iI o R5R(N_E) % ----________ - _ 1 .11, R5\** R(i41E) \‘,... * c �� ow st. vos , w,'-' t ��\v =R5R(NE,) 0 cc 0n L f'Stree _Nays"1"......: o ,, 1 R-5R(N E) \\_ � i R�5 R(N E) V �-_._ - ' _ -- \1- - \ \ ?.. \ 0 1M elA , , , 01.10W is w00111101.1 - -\ A \ IP CS lk-irfe* _ -'1 \ „ __ \ ei ` '' * Ok -111110011, jo-fr oto o\,,5,,,51I0\ A T-- tc*/; •C ,,,. \ \,°,.I _•"_..c.. R5 R -NEE street i53(NE) ; ii/ ),_, __. 0 5R(N-E) \V , R5'RN�E� N OM Site Alfred Nicoll W .!2 E Property_Polygons 113 55th Street, Unit A s Zoning Building Nii===micmpFeet PLAN TRANS SURFACES 0 15 30 60 90 120 150 180 p` CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: ALFRED NICOLL [Applicant & Property Owner] Conditional Use Permit (Short Term Rental) for the property located at 113 55th Street, Unit A (GPIN 24198034800001). COUNCIL DISTRICT — LYNNHAVEN MEETING DATE: March 2, 2021 • Background: The applicant is requesting a Conditional Use Permit for Short Term Rental on a 6,625 square-foot parcel zoned R-5R (NE) Residential District in the North End. The lot consists of one duplex and the applicant only owns the subject unit, which contains three bedrooms. The minimum number of parking spaces required for the Short Term Rental is one per bedroom, or three spaces in this instance. The maximum occupancy for guests on-site after 11:00 p.m. for a three-bedroom Short Term Rental is nine; however, at the time of this writing, the applicant agreed with City Council's recent Short Term Rental condition revisions reducing the number of overnight guests permitted to two per bedroom and limiting the number of bookings in a seven day period from two to one. These changes are reflected in the conditions below. ■ Considerations: This site is located within the North End community, which is primarily home to single-family and duplex style dwellings. The subject property is approximately 350 feet from the public beach of the Atlantic Ocean and is within easy biking distance to the oceanfront boardwalk and other resort venues. The applicant's parking plan depicts all three required off-street parking spaces within the existing driveway, which meets the requirements of Section 241.2(1) of the City Zoning Ordinance. In addition, the remaining requirements of Section 241.2 of the Zoning Ordinance pertaining to Short Term Rentals can be reasonably met by the applicant. Further details pertaining to the application are provided in the attached Staff report. There was one letter of opposition received relating to this request. This primary focus of the letter details the author's opposition to STRs in the North End community; however, the letter does relay concerns regarding the placement of the applicant's public hearing sign on the subject property. The applicant was made aware of this issue and assured Staff that the sign matter would be corrected. The sign was visible from the right of way during a recent site visit. Alfred Nicholl Page 2 of 3 • Recommendation: On January 13, 2021 , the Planning Commission passed a motion to recommend approval of this request by a vote of 9 to 0. 1. The following conditions shall only apply to the dwelling unit addressed as 113 55th Street, Unit A, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. Alfred Nicholl Page 3of3 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10.Accessory structures shall not be used or occupied as Short Term Rentals. 11.No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12.The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13.The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14.There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15.The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16.To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. • Attachments: Staff Report and Disclosure Statements Location Map STR Vicinity Map Minutes of Planning Commission Hearing Letter of Opposition (1) Recommended Action: Staff recommends Approval. Planning Commission recommends Approval. Submitting Department/Agency: Planning Department - City Manager: (4-0 Applicant and Property Owner Alfred Nicoll Agenda Item Planning Commission Public Hearing January 13, 2021 City Council Election District: Lynnhaven 22 City of Virginia Beach Request Conditional Use Permit (Short Term Rental) Staff Recommendation 6,,sit. `` Approval Off 65,65 t 7 aro c� c'ce Staff Planner ,\ 6,s`s"eel afroir -11 William Miller 6u�nso Location g�hs1,.•` 113 55th Street, Unit A 561tis" r sup+s''''a�,aro �, GPIN ms�et ; 24198034800001 S° 9,es4 Site Size svos"-,A s 6,625 square feet e1s1s:::: ��„see< `- a \ - say Si,eet pN.Y'1 Existing Land Use and Zoning District Duplex dwelling/ R-5R Residential (North End) Surrounding Land Uses and Zoning Districts North 55th 1/22Street (alley) - � ti ° • • I -. o, Duplex dwellings/R-5R Residential (North End) South ;., i . u 55th Street ; ,.1 4 �� Duplex dwellings/ R-5R Residential (North End) ;; tti51,e 1 East 511. .� Duplex dwellings/ R-5R Residential (North End) West `� . ,� ° D '' Duplex dwellings/ R-5R Residential (North End) 1.• +1._ 1, ' a _E_ t K .. ppvs ,° �, '-- .. cam €,1+ F 5vec1Mr - : Kr. 07 _41.1::- 2 .i. 1: . .„,„ ...,01 . , , , ..„, .• , •t, ., ,...„. , • • .‘t - -' it% *IA ,1§7- ‘ Alfred Nicoll Agenda Item 22 Page 1 Background & Summary of Proposal Site Conditions and History • This 6,625 square foot lot is zoned R-5R(NE) Residential District and contains one duplex building built in 1989. • According to City records,this application is for a three-bedroom unit in the duplex. • Staff inspected the site on November 17, 2020 to observe site conditions and take photographs for this report. • Parallel parking in the City right-of-way is permitted 24-hours per day; therefore, any overflow parking beyond the minimum parking spaces required could occur within the public right-of-way. • No records of zoning violations relating to Short Term Rental use were found associated with the subject address. • The applicant accepts City Council's recently imposed conditions reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Short Term Rentals in the Vicinity en t n'111 __ '04, . cjt ree 52, 1 �'e1� et '� / G ,,--------36 -4 --- . ° ;0 ' 4 W. f , .:*-....ik ,... ai\looi ----r ittir_... -*: Iii • ���.0 STATUS'. 0 gm Y wits. i i -\ 'PI ill: - Q Approved � -� � � • \. "lt -et ,���,AL • Denied • i� a 0 Under Review ••p. Ili sl il',� 1 Q r Reg- red �,'���\\ /,,�`� • Map updated on 01.27.2021 Summary of Proposal The applicant submitted a Conditional Use Permit request to operate a Short Term Rental on the subject site. The regulations for Short Term Rental use are identified in Section 241.2 of the City Zoning Ordinance. Specific details pertaining to this application are listed below. • Number of bedrooms in the Short Term Rental: 3 • Maximum number of guests permitted on the property after 11:00 pm: 6-As recommended in condition#15 Alfred Nicoll Agenda Item 22 Page 2 • Number of parking spaces required (1 space per bedroom required): 3 • Number of parking spaces provided on-site: 3 0 F 5R;NE 5RINE Zoning History `' �' ale # Request 0 f� 1 SVR(Lots 1A and 113 created/reduced width for Lot 1A) aRliiel' ,.; Approved 03/20/2018 2 NON(Enlargement/Room addition)Approved 08/15/2017 $ n � 3 NON(Enlargement/Room A roved 05 16 2017 ,fi' ,'� ��f,� // addition) pp / / SSO tr 1 ' R4R(NE) Application Types CUP—Conditional Use Permit MOD—Modification of Conditions or Proffers FVR—Floodplain Variance LUP—Land Use Plan REZ—Rezoning NON—Nonconforming Use ALT—Alternative Compliance STR Short Term Rental CRZ—ConditionalRezoning STC—Street Closure SVR—Subdivision Variance Evaluation & Recommendation This site is located within the North End community,which is primarily home to single-family and duplex style dwellings. The subject property is approximately 350 feet from the public beach of the Atlantic Ocean and is within easy biking distance to the oceanfront boardwalk and other resort venues. The applicant's parking plan depicts all three required off-street parking spaces within the existing driveway, which meets the requirements of Section 241.2(1) of the City Zoning Ordinance. In addition,the requirements of Section 241.2 of the Zoning Ordinance pertaining to Short Term Rentals can be reasonably met by the applicant. Based on the considerations above, Staff recommends approval of this request with the conditions listed below.The recommended conditions do reflect City Council's Short Term Rental revisions by reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Recommended Conditions 1. The following conditions shall only apply to the dwelling unit addressed as 113 55th Street, Unit A, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Alfred Nicoll Agenda Item 22 Page 3 Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints,violations of its conditions or violations of any building, housing, zoning,fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2))on the property where the Short Term Rental is located.This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person,who may be the owner, operator or an agent of the owner or operator,who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when,the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements'a'through 'c' below.This information must be submitted to the Planning Department for review and approval.This shall be done within six(6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration;and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law,each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23-71 (noise),31-26,31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks),and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles,where provided,and comply with the requirements of City Code sections 31-26, 31-27 and 31-28. 10. Accessory structures shall not be used or occupied as Short Term Rentals. 11. No signage shall be on-site,except one(1),four(4)square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7)day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers")shall be two (2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and,where natural gas or propane is present, carbon monoxide detectors,shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes Alfred Nicoll Agenda Item 22 Page 4 and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design(CPTED)concepts and strategies as they pertain to this site. Public Outreach Information Planning Commission • As required by the Zoning Ordinance,the public notice sign(s)was placed on the property on December 14, 2020. • As required by State Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, December 27, 2020,and January 3, 2021. • As required by City Code,the adjacent property owners were notified regarding the request and the date of the Planning Commission public hearing on December 28, 2020. • This Staff report, as well as all reports for this Planning Commission's meeting,was posted on the Commission's webpage of www.vbgov.com/pc on January 7, 2021. City Council • As required by City Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, February 14, 2021 and February 21, 2021. • As required by City Code,the adjacent property owners were notified regarding both the request and the date of the City Council's public hearing on February 15, 2021 • The City Clerk's Office posted the materials associated with the application on the City Council website of https://www.vbgov.com/government/departments/city-clerk/city-council/Documents/BookmarkedAgenda.pdf on February 26, 2021. Alfred Nicoll Agenda Item 22 Page 5 Site Layout & Parking Plan 55th '/2 Street 101.._ 24 a • f r 9' x 18' iltik, // III parking space \\ J • chi ` CD � \h.' i • •` _ N\\ I •• • •• -� --I 11r6oN I "'' Condo line 1 V ` illikk separation _1 PVA ///i •4401 . :. 4 O��4 •rG / !- 81' a .0.0. / '.3 20' BUILDING ` SETBACK LIKE 0 s !Aline V sp." 10 55th Street Alfred Nicoll Agenda Item 22 Page 6 Site Photos ..,.. . • _ ,,....; v- ... I vim' 1• , .0. ,,_... ... 4.,• "IV, I _„-- , _-- • .1 r t'. ' ••' '" :• .„, : 1 ' NL .-- • f A '-f. , • ......, ,-1 a ..' ' ,friA.— .. ..e.... -- ' ;,i • -...'- .'i' f ...0:" '••• _. wit— F:-...rr;. . 7:-7.. ;... ' • . ..s.3. - ,... . '''". . ..- —..... •••' ' ' - ''' .*_.... .-- ........a"''. — -:--. •.._- - - . . ..- , - ...., •••• ' ••' it..'--"<:''.',.e.., .-1- .....,... ... _ - ... -- . . ... '. '.,, , .;!...• , ..,, •1 11tr- :-.A".,'. ''' -. ts.'-v-Itt.4.'%!•- .,‘, =--- --------- . . . . . . ... - ,. „.I.., ..i _. .. \A ..: -- , • - .1.1. . - . • . _--,;:- .: -,_- i . ... . • t, ..-"..."... ..- .., Z1,t-'. '. P. -..—............* -----,. . --:- ....„,--,—....- ':•,•'' .:nr.ThiteZ -,„.. -.: ....., Alfred Nicoll Agenda Item 22 Page 7 Site Photos \ t. r • p 1 i< to € , .-'_� I! ,. s 7_u a sue "r r.q..:. Alfred Nicoll Agenda Item 22 Page 8 Disclosure Statement APPLICANT'S NAME Alfred Nicholl DISCLOSURE STATEMENT FORM The completion and submission of this form is required for all applications that pertain to City real estate matters or to the development and/or use of property in the City of Virginia Beach requiring action by the City Council or a board, commission, or other body appointed by the City Council. Such applications and matters include, but are not limited to, the following: Acquisition of Property E Disposition of City Modification of by City Property Conditions or Proffers Alternative Economic Development Nonconforming Use Compliance,Special Investment Program Changes _Exception for (EDIP) Board of Zoning Encroachment Request Rezoning Appeals Certificate of Floodplain Variance Appropriateness Street Closure (Historic Review Board) ' Franchise Agreement Chesapeake Bay 1 Preservation Area Lease of City Property Subdivision Variance Board Conditional Use Permit License Agreement i Wetlands Board • The disclosures contained in this form are necessary to inform public officials who may vote on the application as to whether they have a conflict of interest under Virginia law. SECTION 1 / APPLICANT DISCLOSURE - Page 1 of 7 r._._ _ _ 01-1-2021 ❑ 02-01-2021 As per the applicant,there are no anticipated changes before the March 2, 2021 CC public hearing. W%ILM(,Ller/ Date: 02-01-2020 Alfred Nicoll Agenda Item 22 Page 9 Disclosure Statement Virginia Beach Check here if the APPLICANT IS NOT a corporation, partnership, firm, business,or other unincorporated organization. nCheck here if the APPLICANT IS a corporation, partnership, firm, business, or other unincorporated organization. (A) List the Applicant's name:_p A ►J t cow- If an LLC, list all member's names: If a CORPORATION, list the the names of all officers, directors, members, trustees, etc. below: (Attach list if necessary) (B) List the businesses that have a parent-subsidiary 1 or affiliated business entity 2 relationship with the Applicant: (Attach list if necessary) See next page for information pertaining to footnotes and 2 SECTION 2 / PROPERTY OWNER DISCLOSURE Complete Section 2 only If property owner is different from Applicant. E Check here if the PROPERTY OWNER IS NOT a corporation, partnership,firm, business, or other unincorporated organization. Check here if the PROPERTY OWNER IS a corporation, partnership,firm, — business, or other unincorporated organization, AND THEN,complete the following. (A) List the Property Owner's name: If an LLC, list the member's names: Page 2 of 7 Alfred Nicoll Agenda Item 22 Page 10 Disclosure Statement \13 Virginia Beach If a Corporation, list the names ofall officers, directors, members, trustees, etc. below: (Attach list if necessary) (B) List the businesses that have a parent-subsidiary i or affiliated business entity 2 relationship with the Property Owner: (Attach list if necessary) "Parent-subsidiary relationship' means "a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,Va. Code 4 2.2-3101. 2 "Affiliated business entity relationship" means "a relationship, other than parent-subsidiary relationship,that exists when (i)one business entity has a controlling ownership Interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity, or (iii) there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person awn or manage the two entities;there are common or commingled funds or assets; the business entities share the use of the same offices or employees or otherwise share activities, resources or personnel on a regular basis; or there is otherwise a close working relationship between the entities.' See State and Local Government Conflict of interests Act, Va.Code§ 2.2-3101. SECTION 3. SERVICES DISCLOSURE Are any of the following services being provided in connection with the subject of the application or any business operating or to be operated on the Property. If the answer to any item is YES, please identify the firm or individual providing the service: IF THE OWNER AND APPLICANT ARE DIFFERENT, EACH MUST COMPLETE THE SECTION SEPERATELY • Page 3 of 7 Alfred Nicoll Agenda Item 22 Page 11 Disclosure Statement laB APPLICANT v►tginia searx, YES NO SERVICE PROVIDER(use additional sheets If needed) Accounting and/or preparer of your tax return n E Architect/Landscape Architect/ Land Planner Contract Purchaser(if other than 0 ❑✓ the Anoiicant)-identify purchaser and purchaser's service providers Any other pending or proposed El uu purchaser of the subject property (identify purchaser(s)and purchaser's service providers) A Er Construction Contractors Engineers/Surveyors/Agents Financing(include current CM-OWL tia4E Lcs.6 Q ❑ mortgage holders and lenders selected or being considered to provide financing for acquisition or construction of the property) 0 a Legal Services Real Estate Brokers/ 0 a Agents/Realtors for current and anticipated future sales of the subject property • • SECTION 4. KNOWN INTEREST BY PUBLIC OFFICIAL OR EMPLOYEE YES NO Does an official or employee of the City of Virginia Beach have ❑ {r an interest in the subject land or any proposed development Lj contingent on the subject public action? If yes,what is the name of the official or employee and what is the nature of the interest? Page 4 of 7 Alfred Nicoll Agenda Item 22 Page 12 Disclosure Statement VB Virginia Beach CERTIFICATION: I certify that all of the information contained in this Disclosure Statement Form is complete,true, and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing, I am responsible for updating the information provided herein two weeks prior to the Planning Commission, Council, VBDA 1 meeting, or meeting of any public body or committee in connection with this Application. 1 ta..FzlE� P- tCO 411C/21%a rAPPUCANT'S SIGNATURE PRINT NAME DATE -- - - — - Page 5 of 7 Alfred Nicoll Agenda Item 22 Page 13 Next Steps • Upon receiving a recommendation from Planning Commission,this request will be scheduled for a City Council public hearing. Staff will inform the applicant and/or their representative of the date of the hearing in the upcoming days. • Following City Council's decision,the applicant will receive a decision letter from Staff. • Once the conditions of approval are in place and/or completed,the applicant must contact the Zoning Division of the Planning Department to obtain verification that the conditions have been met. Contact the Zoning Division at 757-385-8074. • If the request requires land disturbance and/or a subdivision of property, please contact the Development Services Center(DSC)to discuss next steps for site plan/plat review. Contact the DSC at 757-385-4621 or the Development Liaison Team at 757-385-8610. • Please note that further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/ Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. • The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED)concepts and strategies as they pertain to this site. Alfred Nicoll Agenda Item 22 Page 14 STR VICI L— ITY _.—AP ALFRED NICHOLL - 113 A 55TH STREET '':.,:\ IA. \—::::\ ,______,60tbri‘tclitt 1 \,ti• WI f�� tree*` - c9 \ \ et � �� t ^�_ -9t _. fit t. 7 ?' \\ \V \_:—: .:...3 .,: ,_:s._:>. . .� 1 •�J Wes- __ 1. f ref 1 11,,,„_...0 0 y, 6tr 00111 yr • t -ram atil f`1 tit r- �, -_ram- -) ' till G I------,:5 �,1p pUev S --\11.- ----7 4--- TATUS• Approved f - p 1: ��`' p\1 e I 110 .1 l Denied __ 2':. ..- Under Review • ,....\ li Registered !+ AttV, �',' Items # 22 Alfred Nicoll [Applicant& Property Owner] Conditional Use Permit(Short Term Rental) 113 55th Sheet Unit A January 13, 2021 RECOMMENDED FOR APPROVAL - HEARD Mr. Dao: That is correct. Item 22, the application of Alfred Nicoll for a Conditional Use Permit for Short-Term Rental located at 113 55th Street, Unit-A in the Lynnhaven District, the applicant is Gus Nicoll. Mr. Nicoll, you have 10 minutes, please start by saying your name for the record and begin your comments. Mr. Nicoll: Hi, good afternoon everybody and thank you to the Planning Commission for giving me an opportunity to discuss my intentions. I applied for a short-term rental application. I have lived in Virginia Beach for 30 years, I am a retired naval officer, the last decade I have lived in the North End of Virginia Beach. I have raised my family here, I only mentioned that so that you all know I have the same intent of ensuring that Virginia Beach remains a wonderful place to live and raise a family. My intention is to, on a very limited basis, have the ability to rent my home. This is my primary home, it is my only home and occasionally over the last year or two, I have had occasion to travel for work and for pleasure, and we would like to have the opportunity on a very limited basis to be able to execute short-term rentals in my property. So, I will be brief in my comments, but happy to answer any questions from the Commission or anybody else. Thank you. Mr. Weiner: Thank you, sir. Are there any questions. No questions. 1 Mr. Dao: We have one speaker registered for this item, however, Staff is [inaudible] the individual on the list at this time. So, no more speakers. Mr. Weiner: We have no more speakers, this would be Lynnhaven, Mr. Graham is he back online. Mr. Graham is not back online. Mr. Dao: Mr. Graham is back online. Mr. Weiner: Does anybody have any comments about this short-term rental they would like to share before Mr. Graham comes on. Mr. Wall: I have got one thing, and it is actually for Staff and I am not opposed to this application just brings up a point. At this point, and there is Mr. Graham, but for Staff, for Conditional Use Permits, they run with the land. So, this gentleman's interested in part time or occasionally using his property as a short-term rental. But, there are changes in the future, possibly. But, at this point if this is in perpetuity. So, Staff if you can chime in on this, yes or no, is that the conditioning is permanent, which is, he could go and sell the house, and it is still there for short- term rental at this point. Can somebody answer that. Mr. Miller: Yeah, the Conditional Use Permit under the current ordinance would allow it to continue for five years and then can be administratively renewed. If during that time there is an issue or problem, it can be revoked. So, if he were to sell the house and whoever the new owner is has some issues, then it could be revoked and this is all under the current ordinance, not even discussing the one that is going forth. Mr. Wall: Okay, thanks. Mr. Weiner: Okay, we have Mr. Graham with us. Mr. Graham, this is your neck of the woods. Item 22. Mr. Graham: Yeah. And, I apologize, I missed a good deal of the presentation. I am not quite prepared. I was off, I lost internet. 2 Mr. Weiner: Let us let George takeover. George's good with us, he is pro at short- term rentals. Ms. Smith: So, Mr. Graham, I will say, this is Carolyn Smith, that there was no speaker in opposition. One had signed up but they did not, they were not still on the line, so you did not miss any conversation about any opposition, just wanted you to be aware of that. Mr. Graham: It sounds like I missed some of the conversation and most of the Commissioners, if I can be updated it would be helpful. Mr. Weiner: Mr. Graham, we really have not talked about anything, we are waiting for you. So, we did hear that this is his primary residence and he rented out when he is not in town, which personally I tend to like, he has met all the requirements. So, I am going to support it, since there is no opposition. Mr. Graham: Yeah. Okay, I thought I had missed more, I was scrambling to try to get back, I apologize. Correct me if I am wrong, if we move forward with the Overlay Districts, this will be in an Overlay District as designed today. Mr. Weiner: That is correct. Mr. Graham: I do not have any opposition to this. If there is not any opposition, I would like to go ahead and recommend approval. Mr. Weiner: We have a motion for approval. Do we have a second. Mr. Redmond: Second. Mr. Weiner: We have a motion by Mr. Graham for approval and second by Mr. Redmond. We are ready to vote. Ms. Coleman: If you are in favor of the motion say, yes. And, if you are opposed please say, no. Ms. Coleman: Mr. Alcaraz. 3 Mr. Alcaraz: Yes. Ms. Coleman: Mr. Barnes is absent. Mr. Coston. Mr. Coston: Yes. Ms. Coleman: Mr. Graham. Mr. Graham: Yes. Ms. Coleman: Mr. Horsley. Mr. Horsley: Yes. Ms. Coleman: Mr. Inman. Mr. Tajan: Mr. Inman is currently not in the meeting Marchelle. Ms. Coleman: Okay, I will mark him as absent. Ms. Klein. Ms. Klein: Yes. Ms. Coleman: Mr. Redmond. Mr. Redmond: Yes. Ms. Coleman: Ms. Oliver. Ms. Oliver: Yes. Ms. Coleman: Vice Chair Wall. Mr. Wall: Yes. Ms. Coleman: And, Chairman Weiner. Mr. Weiner: Yes. Ms. Coleman: By recorded vote of nine for and zero against, agenda item 22 has been recommended for approval. AYE 9 NAY 0 ABS ABSENT 2 4 Alcaraz AYE Barnes ABSENT Coston AYE Graham AYE Horsley AYE Inman ABSENT Klein AYE Oliver AYE Redmond AYE Wall AYE Weiner AYE CONDITIONS: 1. The following conditions shall only apply to the dwelling unit addressed as 113 55th Street, Unit A, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241 .2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty (30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for 5 review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10. Accessory structures shall not be used or occupied as Short Term Rentals. 11. No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. 6 Further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards. All applicable permits required by the City Code, including those administered by the Department of Planning / Development Services Center and Department of Planning / Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED) concepts and strategies as they pertain to this site. 7 From: David Mueller To: William N.Miller Subject: Re: 115 55th Street,unit A-STR CUP request Date: Friday,January 8,2021 12:02:15 PM CAUTION:This email originated from outside of the City of Virginia Beach.Do not click links or open attachments unless you recognize the sender and know the content is safe. Yes, you may use it as an objection. I live at 204 60th street. Thank you. Dr. Da td.Mtteller Virginia Facial Surgery 1157 First Colonial Road, Suite 101 Virginia Beach, Virginia 23454 757-496-8066 www.vafacialsurgery.com This transmission and document may contain confidential information, which is privileged. The conversation contained herein may not be construed as medical advice, a consultation or a guarantee of results for any medical treatment or procedure. The information is intended only for the individual or entity named above. If you are not the intended recipient, or the person responsible for delivering it to the intended recipient, you are hereby notified that any disclosure, copying, distribution or use of any of the information contained in this transmission is strictly prohibited. If you have received this transmission in error, please notify us by phone. From:William N. Miller<WNMiller@vbgov.com> Sent: Friday,January 8, 2021 11:11 AM To: drdpmueller@hotmail.com <drdpmueller@hotmail.com> Cc:Summer J. Peebles<sjpeeble@vbgov.com> Subject: 115 55th Street, unit A-STR CUP request Good morning, I received the email below from my coworker, Summer Peebles. Since there is content within the body of the email relating to a currently requested STR Conditional Use permit, I must ask if you wish me to also use your letter as an official objection to the STR request at 113 55th Street, Unit A (Alfred Nicoll), which is scheduled for the January 13, 2021 Planning Commission public hearing. If you would like for me to include your letter as opposition to Mr. Nicoll's request, please let me know and I will do so. The only addition needed is your address so we can add your property to the standard support/opposition map requested by the Planning Commissioners and added to their Powerpoint presentation. Which is shown at the public hearing. Thank you. Will Miller Zoning Inspector III Short-Term Rental Team Planning Department Zoning Administration 2875 Sabre St.Suite 500 Virginia Beach,VA. 23452 757-385-5066 (voicemail) Original Message From: David Mueller <drdpmuellerPhotmail.com> Sent: Thursday, January 7, 2021 5:56 PM To: Zoning Short Term Rental <STR@vbgov.com> Subject: North end short term rental program CAUTION: This email originated from outside of the City of Virginia Beach. Do not click links or open attachments unless you recognize the sender and know the content is safe. To whom it may concern, I am opposed to the short term rental zoning overlay and allowing up to 52 rentals of unspecified length in a year in the north and Virginia Beach zone. Furthermore, I would like the conditional use permit (CUP) a process to remain in place as it presently is, meaning that rentals are limited to one per week. There is already a very large influx of automobiles and short-term visitors to the north end. Parking is already at a premium and owners cannot even park in front of their own homes most of the time. As such, a certain individual on ocean side of 55th St. has applied for one of these zoning changes. The notice was placed in his front yard, and as he does not wish to play fair, he has parked his pick up truck less than 1 foot from his sign ever since the city put the notice of hearing sign in his front yard. He has been notified multiple times that he is required to have the sign visible to the public and yet he has never once moved his pick up truck. Moreover, prior to setting the sign in front of the house, his pick up truck is never parked in front of the house. I am opposed to this change in a short term rental rezoning because it will cause undue stress as well as all other inconveniences and annoyances that daily and weekly rentals exhibit in residential areas. The north end of Virginia Beach should be kept a residential area and not an extended resort area. Thank you. Sincerely, David Mueller Sent from my iPhone . s J • 1 ---1 pirjrr.vipLir -• I L -,- -Al2 —L - -u� Al2— 1 , P1 J —I_ ) —i___ _,J I Goose Landing = Goose Landing 1 \ i k = rola ) , = A_12 Al2 R5D7 _ Al2 1 I p NEM -r < I ._ M P1 P1 P1 N WA Site Karen & Joe Allen w 4 vok Property_Polygons 1361 Goose Landing Zoning Building - so 1.1 Feet PLAN TRANS SURFACES 012.T5 50 75 100 125 150 / U.", f0 eri'� (V l�" E•1 CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: KAREN AND JOE ALLEN [Applicants] OLD HICKORY INVESTMENTS, LLC [Property Owner] Conditional Use Permit (Short Term Rental) for the property located at 1361 Goose Landing (GPIN 2417622261). COUNCIL DISTRICT — BEACH MEETING DATE: March 2, 2021 • Background: The applicant is requesting a Conditional Use Permit for a Short Term Rental on a 2,433 square-foot parcel zoned A-12 Apartment District. The lot consists of one townhome dwelling containing two bedrooms. The minimum number of parking spaces required for the Short Term Rental is one per bedroom, or two spaces in this instance. The maximum occupancy for guests on-site after 11:00 p.m. for a two-bedroom Short Term Rental is six; however, at the time of this writing, the applicant accepts City Council's recent Short Term Rental condition revisions reducing the number of overnight guests permitted to two per bedroom and limiting the number of bookings in a seven day period from two to one. These changes are reflected in the conditions below. • Considerations: This property is located in the Salt Marsh Point subdivision and contains one townhome style dwelling sitting within a row of seven units. The subject address contains two bedrooms and requires two off-street parking spaces. The proposed parking plan shows both required spaces within the driveway in front of the unit, which meets the requirements of Section 241 .2(1) of the City Zoning Ordinance (CZO). In addition, the remaining stipulations found in Section 241 .2 of the City Zoning Ordinance pertaining to Short Term Rentals can be reasonably met by the applicant. Further details pertaining to the application are provided in the attached Staff report. There is no known opposition to this request. • Recommendation: On January 13, 2021, the Planning Commission passed a motion to recommend this item on the Consent Agenda, passing a motion by a recorded vote of 10-0, to recommend approval of this request. Karen & Joe Allen Page 2 of 3 1 . The following conditions shall only apply to the dwelling unit addressed as 1361 Goose Landing, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- Karen & Joe Allen Page 3 of 3 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10.Accessory structures shall not be used or occupied as Short Term Rentals. 11 .No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12.The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13.The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14.There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15.The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16.To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. • Attachments: Staff Report and Disclosure Statements Location Map STR Vicinity Map Minutes of Planning Commission Hearing Recommended Action: Staff recommends Approval. Planning Commission recommends Approval.Submitting Department/Agency: Planning Department 6�. 0�j-� City Manager: 1 Applicant Karen & Joe Allen Agenda Item Property Owner Old Hickory Investments, LLC /' Planning Commission Public Hearing January 13, 2021 23 1 City Council Election District Beach Virginia Beach Request Conditional Use Permit (Short Term Rental) Staff Recommendation Maier Lane i ► Approval Southern Boulevard Jackson Sir e Staff Planner i`� °� s,hst,.0, Summer Peebles Jensen Dove Location Seautdul Serest- _ ll- 1361 Goose Landing �,�••► + ; GPIN ; 2417622261 Site Size ��°'"`c'••k 2,433 square feet _,L • Existing Land Use and Zoning District Townhouse/A-12 Apartment Surrounding Land Uses and Zoning Districts North Goose Landing t• Townhouses/A-12 Apartment 4 '• • �*_ South Marshview Park/ P-1 Preservation 't. Goose Lending East Townhouses/A-12 Apartment ' = n West - *• "`' , . - m. .`a,' ,` ', Townhouses/A-12 Apartment _ c' — 1 T r X- [ rr r z .f� �'�f 14. was r•� '-� X_ Karen &Joe Allen Agenda Item 23 Page 1 Background & Summary of Proposal Site Conditions and History • This is a 2,433 square foot parcel is located within the A-12 Apartment District. • The subject dwelling was constructed in 1984. • Staff inspected the site on November 17, 2020 to observe site conditions and take photographs for this report. • On-street parking is permitted 24-hours per day;therefore, any overflow parking beyond the minimum parking spaces required could occur within the public street. • The applicant accepts City Council's recently imposed conditions reducing the number of bookings in a seven- day period to one and limiting the overnight guest calculation to two per bedroom. Short Term Rentals in the Vicinity ilk IP° Vs tit:, , 440 _ , \' . . lum i111 {N1106. ` T 111MINI� , m ,�Q `�IINM1 t t •rye11411.01 ! 111 L l ' l { SUTU • Approved • Denied p Under Review Q Registered Map current as of 01.27.2021 Summary of Proposal The applicant submitted a Conditional Use Permit request to operate a Short Term Rental on the subject site.The regulations for Short Term Rental use are identified in Section 241.2 of the City Zoning Ordinance. Specific details pertaining to this application are listed below. • Number of bedrooms in the Short Term Rental: 2 • Maximum number of guests permitted on the property after 11:00 pm: 4-As recommended in condition 15 • Number of parking spaces required (1 space per bedroom required): 2 Karen &Joe Allen Agenda Item 23 Page 2 • Number of parking spaces provided on-site: 2 r1111 Goose Loading PIM UIII Zoning History ' 0%;i It # Request 1 NON(Enclose a front patio)Approved 06 23 2009 114 1111111111 . 44 P•1 P-1 Application Types CUP—Conditional Use Permit MOD—Modification of Conditions or Proffers FVR—Floodplain Variance LUP—Land Use Plan REZ—Rezoning NON—Nonconforming Use ALT—Alternative Compliance STR—Short Term Rental CRZ—Conditional Rezoning STC—Street Closure SVR—Subdivision Variance Evaluation & Recommendation This property is located within the Salt Marsh Point subdivision.This townhouse contains two bedrooms and requires two off-street parking spaces.The proposed parking plan shows both parking spaces within the driveway in front of the unit,which meet the requirements of Section 241.2(1)of the City Zoning Ordinance (CZO). Furthermore,the remaining requirements of Section 241.2 of the City Zoning Ordinance pertaining to Short Term Rentals can be reasonably met by the applicant. Based on the considerations above,Staff recommends approval of this request with the conditions listed below.The recommended conditions do reflect City Council's Short Term Rental revisions by reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Recommended Conditions 1. The following conditions shall only apply to the dwelling unit addressed as 1361 Goose Landing, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5)years from the date of approval.The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however,the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints,violations of its conditions or violations of any building, housing, zoning,fire or other similar codes. Karen &Joe Allen Agenda Item 23 Page 3 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two(2))on the property where the Short Term Rental is located.This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1(8a). 5. The owner or operator must provide the name and telephone number of a responsible person,who may be the owner,operator or an agent of the owner or operator,who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when,the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a'through 'c' below.This information must be submitted to the Planning Department for review and approval.This shall be done within six(6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration;and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law,each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23-71 (noise),31-26, 31-27 and 31-28 (solid waste collection), 12-5(fires on the beach), 12-43.2 (fireworks),and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles,where provided,and comply with the requirements of City Code sections 31-26, 31-27 and 31-28. 10. Accessory structures shall not be used or occupied as Short Term Rentals. 11. No signage shall be on-site,except one (1),four(4)square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7)day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15. The maximum number of persons on the property after 11:00 p.m.and before 7:00 a.m. ("Overnight Lodgers")shall be two(2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors (which may be wireless),a fire extinguisher and,where natural gas or propane is present, carbon monoxide detectors,shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. Karen &Joe Allen Agenda Item 23 Page 4 The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design(CPTED)concepts and strategies as they pertain to this site. Public Outreach Information Planning Commission • As required by the Zoning Ordinance,the public notice signs were placed on the property on or before December 14,2020. • As required by State Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, December 27, 2020,and January 3, 2021. • As required by City Code,the adjacent property owners were notified regarding the request and the date of the Planning Commission public hearing on December 28, 2020. • This Staff report, as well as all reports for this Planning Commission's meeting,was posted on the Commission's webpage of www.vbgov.com/pc on January 7, 2021. City Council • As required by City Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, February 14, 2021 and February 21, 2021. • As required by City Code,the adjacent property owners were notified regarding both the request and the date of the City Council's public hearing on February 15, 2021 • The City Clerk's Office posted the materials associated with the application on the City Council website of https://www.vbgov.com/government/departments/city-clerk/city-council/Documents/BookmarkedAgenda.pdf on February 26, 2021. Karen &Joe Allen Agenda Item 23 Page 5 Site Layout & Parking Plan 25 Tv PED. N 83'24'21" w F 0 COR. 25.00' PIN (F) '�'— 5' UTILITY & DRAINAGE EASEMENT jet_X - 6.0' 0.35' B / ON LINE DECK ALL FENCES o I rj. ARE 6' WOOD 0 8.2' h o C o 5.65' o 2 STORY o < FRAME A TOWNHOUSE o # 1361 m 4.40' o o N M "-`` 1.2'w am tit' CONC. cin 'cMo 9.3 10.3' Po is In o N i ! FR. SHED �' x p z x e.mip,. 2 parking spaces pri "' on-site PIN (F)1 PIN (F) GOOSE LANDING FORMERLY EIGHTH ST. 50' Karen &Joe Allen Agenda Item 23 Page 6 Site Photos ^y. � .. -x j pi sy� w + ;j ;.$ T jepy40, • IF d . a. . 4 -401 • • Karen &Joe Allen Agenda Item 23 Page 7 Site Photos L x � f,_ a*. * -, : , ,.. ., ';'';?.''‘‘' ;;"'-:'1;*'::1111'a',.' is _ 'x_ x rye' Karen &Joe Allen Agenda Item 23 Page 8 Disclosure Statement Disclosure Statement \43 y.of5 Planning&Community Development The disclosures contained in this form are necessary to inform public officials who may vote on the application as to whether they have a conflict of interest under Virginia law. The completion and submission of this form is required for all applications that pertain to City real estate matters or to the development and/or use of property in the City of Virginia Beach requiring action by the City Council or a City board,commission or other body. Applicant Disclosure Applicant Name e—e✓e-k, & k)e A-1 ti Does the applicant have a representative? 0 Yes Da< • if yes,list the name of the representative. Is the applicant a corporation,partnership,firm,business,trust or an unincorporated business? ❑ Yes tit No • If yes,list the names of all officers,directors,members,trustees,etc.below. (Attach a list if necessary) • If yes,list the businesses that have a parent-subsidiary'or affiliated business entity'relationship with the applicant. (Attach a list if necessary) '"Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. 2"Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(iii)there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a close working relationship between the entities." See State and Local Government Conflict of Interests Act,Va. Code§2.2-3101. 3IPa Karen &Joe Allen Agenda Item 23 Page 9 Disclosure Statement Disclosure Statement 'tanning&Comment Development Known Interest by Public Official or Employee Does an official or employee of the City of Virginia Beach havean interest in the subject land or any proposed development contingent on the subject public action?❑Yes Lid 1 • If yes,what is the name of the official or employee and what is the nature of the interest? Applicant Services Disclosure 1. Does the applicant have any existing financing(mortgage,deeds of trust,cross-collateralization,etc)or are they considering any financing in ceection with the subject of the application or any business operating or to be operated on the property? ❑Yes 101 o • If yes,identify the financial institutions. 2. Does the applicantpl� have a real estate broker/agent/realtor for current and anticipated future sales of the subject property? ❑Yes G No • If yes,identify the real estate broker/realtor. 3. Does the applicant have services for accounting and/or preparation of tax returns provided in connectionwith the subject of the application or any business operating or to be operated on the property?El Yes l3'N6 • If yes,identify the firm or individual providing the service. 4. Does the applicant have services from an architect/landscape architect/land planner provided inconnection with the subject of the application or any business operating or to be operated on the property?❑Yes lld'IVO • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?0 Yes 1111V0 • If yes,identify the purchaser and purchaser's service providers. 2I d Karen &Joe Allen Agenda Item 23 Page 10 Disclosure Statement Disclosure Statement Planning&Com u Development 6. Does the applicant have a construction contractor, connection with the subject of the application or any business operating or to be operated on the property?❑Yes [ fiCIa • If yes,identify the construction contractor. 7. Does the applicant have an engineer/surveyor/agent in connection with the subject of the application or any business operating or to be operated on the property?0 Yes Rd'iV0 • If yes,identify the engineer/surveyor/agent. 8. Is the applicant receiving legal services in con ection with the subject of the application or any business operating or to be operated on the property?0 Yes • if yes,identify the name of the attorney or firm providing legal services. Applicant Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing,I am responsible for updating the information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board or any public body or committee in connection with this application. Applicant Signature J')( l'cn 14-11 en :toe P i IC- , Print Name and Title / Date Is the applicant also the owner of the subject property? ❑Yes LSkIYO • If yes,you do not need to fill out the owner disclosure statement. FOR CITY USE ONLY/All disclosures must be updated two(2)weeks prior to any Planning Commission and City Council meeting that pertains to the applications No dwnees as of i Drte / slpnhvei, � '�'"' 3IPage Karen &Joe Allen Agenda Item 23 Page 11 Disclosure Statement Disclosure Statement Planning&Community Development - - Owner Disclosure � // /� // 1 Owner Name (;�nn r-'f�ic/ 0L41) SttrieKIC Applicant Name 1) ler) Is the Owner a corporation,partnership,firm,business,trust or an unincorporated business?ale--; ❑No • If yes,list the names of all officers,directors,members,trustees,etc.below. (Attach a list if necessary) 1/-)a4(6,1-. a ,_.)re H 1)ny,• If yes,list the businesses that have a parent-subsidiary3 or affiliated business entity"relationship with the Owner. (Attach a list if necessary) Known Interest by Public Official or Employee Does an official or employee of the City of Virginia Beach,3ave an interest in the subject land or any proposed development contingent on the subject public action?❑Yes L1—d`N/o • If yes,what is the name of the official or employee and what is the nature of the interest? 3"Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. 6"Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(iii)there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a close working relationship between the entities." See State and Local Government Conflict of Interests Act,Va. Code§2.2-3101. 5 ) Page Karen &Joe Allen Agenda Item 23 Page 12 Disclosure Statement Disclosure Statement Planning Community Development Owner Services Disclosure 1. Does the Owner have any existing financing(mortgage,deeds of trust,cross-collaterallzation,etc)or are they considering any financing in conyection with the subject of the application or any business operating or to be operated on the property? ❑Yes No • if yes,identify the financial institutions. 2. Does the Owner_ have a real estate broker/agent/realtor for current and anticipated future sales of the subject property? El Yes ENO • If yes,identify the real estate broker/realtor. 3. Does the Owner have services for accounting and/or preparation of tax returns provideonnection with the subject of the application or any business operating or to be operated on the property?0 Yes o • If yes,identify the firm or individual providing the service. 4. Does the Owner have services from an architect/landscape architect/land planner provided inconnection with the subject of tEG N the application or any business operating or to be operated on the property?0 Yes o • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?0 Yes LW No • If yes,identify the purchaser and purchaser's service providers. 6. Does the Owner have a construction contract_orr i connection with the subject of the application or any business operating or to be operated on the property?0 Yes 11d No • If yes,identify the construction contractor. 7. Does the Owner have an engineer/surveyor/agent i nnection with the subject of the application or any business operating or to be operated on the property?0 Yes MeNo • If yes,identify the engineer/surveyor/agent. 6IPage Karen &Joe Allen Agenda Item 23 Page 13 Disclosure Statement Disclosure Statement Planning&Ccmtmunit- e Development 8. Is the Owner receiving legal services in connection with the subject of the application or any business operating or to be L11'N operated on the property?0 Yes O' • If yes,identify the name of the attorney or firm providing legal services. Owner Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing,lam responsible for updating the information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board or any public body or committee in connection with this application. /1"th191Le Owner Signature IAa(Pn A i Q.Yn c Ai& 1 --DLOIP)eir Print Name and Title /0/ i s/av Date 7 '. Karen &Joe Allen Agenda Item 23 Page 14 Next Steps • Upon receiving a recommendation from Planning Commission,this request will be scheduled for a City Council public hearing. Staff will inform the applicant and/or their representative of the date of the hearing in the upcoming days. • Following City Council's decision,the applicant will receive a decision letter from Staff. • Once the conditions of approval are in place and/or completed,the applicant must contact the Zoning Division of the Planning Department to obtain verification that the conditions have been met. Contact the Zoning Division at 757-385-8074. • If the request requires land disturbance and/or a subdivision of property, please contact the Development Services Center(DSC)to discuss next steps for site plan/plat review. Contact the DSC at 757-385-4621 or the Development Liaison Team at 757-385-8610. • Please note that further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/ Permits and Inspections Division,and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. • The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED)concepts and strategies as they pertain to this site. Karen &Joe Allen Agenda Item 23 Page 15 STR VICINITY MAP KAREN & JOE ALLEN-1361 GOOSE LANDING 1,3/"E s\,4 --i__ 1 *47' - --.. , 1 ck �I Alikiltill1111 It ,_.,,,, 4.- - A\ 1 , „ , . .d t,) 'i"sA,/ N.x .�INIII III 1111ri ` erv�- ` r'iva i . _L0. �ar�'net I I_i .II1MIU - _ ' ` 1 +�IJI :' onna . . - -e.._-.r -•ice'�\ -------- qe .ri�N� -r -1_5-- ,MI L o. \\c\ l STATUS 1 --imp! i I O Approved V�'�— ;� Denied , I ti� Q Under Review / I,t Ea- Q Registered Mill-`� _�_ Items # 23 Karen & Joe Allen [Applicant] and Old Hickory Investments, LLC [Property Owner] Conditional Use Permit(Short Term Rental) 1361 Goose Landing January 13, 2021 RECOMMENDED FOR APPROVAL - CONSENT Mr. Weiner: Thank you. Our next order of business is the Consent Agenda, which the Vice Chair will take over. Mr. Wall: Okay, thank you Mr. Chair. These are applications that are recommended for approval by Staff and the Planning Commission concurred, and there are no speakers signed up in opposition. The Planning Commission places the following applications on the Consent Agenda. Application number 1, 4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20 with an amended condition or with an added condition concerning forested buffer. The Planning Commission also places the following applications for Conditional Use Permit for Short- Term Rental on the Consent Agenda as they meet the applicable requirements for Section 241.2 of the Zoning Ordinance. Staff and the Planning Commission supports the applications, and there are no speakers signed up to comment. These include agenda items number 21, 23, 25, 26, and 27. Mr. Weiner: Thank you Commissioner Wall. Can I get a motion to approve the items on consent, please. Mr. Wall: I make a motion that these items be approved by consent. Ms. Klein: Second. 1 Mr. Weiner: Okay. I got a approval by Commissioner Wall and a second by Ms. Klein, ready for vote. Ms. Coleman: If you are in favor of the motion say, yes. And, if you are opposed say, no. Ms. Coleman: Mr. Alcaraz. Mr. Alcaraz: Yes. Ms. Coleman: Mr. Barnes is absent. Mr. Coston. Mr. Coston: Yes. Ms. Coleman: Mr. Graham. Mr. Graham: Yes. Ms. Coleman: Mr. Horsley. Mr. Horsley: Yes. Ms. Coleman: Mr. Inman. Mr. Inman: Yes. Ms. Coleman: Ms. Klein. Ms. Klein: Yes. Ms. Coleman: Mr. Redmond. Mr. Redmond: Yes. Ms. Coleman: Ms. Oliver. Ms. Oliver: Yes. Ms. Coleman: Vice Chair Wall. Mr. Wall: Yes. Ms. Coleman: And, Chairman Weiner. Mr. Weiner: Yes. 2 Ms. Coleman: By record vote of 10 for and zero against, agenda items 1,4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20, with the added condition for the 20- foot buffer, and 21, 23, 25, 26, and 27 have been approved on the Consent Agenda. AYE 10 NAY 0 ABS 0 ABSENT 1 Alcaraz AYE Barnes ABSENT Coston AYE Graham AYE Horsley AYE Inman AYE Klein AYE Oliver AYE Redmond AYE Wall AYE Weiner AYE CONDITIONS: 1. The following conditions shall only apply to the dwelling unit addressed as 1361 Goose Landing, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241 .2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 3 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty (30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10. Accessory structures shall not be used or occupied as Short Term Rentals. 11. No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 4 15. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards. All applicable permits required by the City Code, including those administered by the Department of Planning / Development Services Center and Department of Planning / Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED) concepts and strategies as they pertain to this site. 5 \ _ _ ii., Isla, 11111.111011WIlla 1 , , , R5S N to � o r �,, I i c Oa iii\ei YO ��� r ire CI CD :::'" c::\ 1110111 , ' . R5S C� R-5S R5S `� r'' �-- a\ .,,,,4,, / 11/4 ar 0 ,,,s,,\, .__ __..,r.„.-i low 011 6—-- --P-.°1-11-.11r.- I li•••.•....•.•.•°111111.11111111111 ii II t \ ' .4,:irgrair01111111111111111 1.1;410 z.\ IIIIIIIIIIIIII1y ,..,c.\)-..-_.. .. o "1. .•. ./► tre .!�/� 25th S -. et eet Q� Street _/ 25th tt 25th -- R5S N r A Site Bao Lo W,A1'N �lliE Property_Polygons 619 25th Street /� QZoning S Building in •=1.• m.o. iim...Feet PLAN_TRANS_SURFACES 012.55 50 75 100 125 150 , .....,,,,, -, r'?‘"1 48....4i, f? it CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: BAO LO [Applicant & Property Owner] Conditional Use Permit (Short Term Rental) for the property located at 619 25th Street (GPIN 2417895644). COUNCIL DISTRICT — BEACH MEETING DATE: March 2, 2021 • Background: The applicant is requesting a Conditional Use Permit for Short Term Rental on an 8,400 square-foot parcel zoned R-5S (OB) Residential District in the Old Beach Overlay. The lot consists of one single-family dwelling built in 2007 and contains four bedrooms. The minimum number of parking spaces required for the Short Term Rental is one per bedroom, or four spaces in this instance. The maximum occupancy for guests on-site after 11:00 p.m. for a four-bedroom Short Term Rental is 12; however, at the time of this writing, the applicant accepts with City Council's recent Short Term Rental condition revisions reducing the number of overnight guests permitted to two per bedroom and limiting the number of bookings in a seven day period from two to one. These changes are reflected in the conditions below. • Considerations: This property is located within the Old Beach Overlay, which includes an assortment of development types and uses. Within this overlay area, Baltic Avenue acts as an undefined boundary between higher and lower density zoning districts. In fact, a large number of properties east of Baltic Avenue fall within a higher density apartment zoning district, while many properties west of Baltic Avenue fall within a lower density residential zoning district. The subject property lies west of Baltic Avenue, was developed in 2007, and contains a four bedroom single-family dwelling. Because the home includes four bedrooms, four off-street parking spaces are required. To satisfy this requirement, the applicant submitted a parking plan noting the location of all four spaces within an existing driveway. Such configuration meets the requirements of Section 241 .2(1) of the City Zoning Ordinance and the remaining conditions listed in Section 241 .2 can be reasonably met by the applicant. Additionally, the subject site lies within the boundaries of the Residential Parking Permit Program (RPPP). Therefore, a condition is recommended that limits the number of Residential Parking Permit Program passes to two and prohibits the issuance of temporary guest passes through the program while the Conditional Use Permit is active. Further details pertaining to the application, as well as Staff's evaluation, are provided in the attached Staff Report. Boa Lo Page 2 of 4 There were four letters of opposition received relating to this request and one speaker was virtually present at the public hearing. The letters and the speaker focused on concerns relating to the number of STRs in the neighborhood, additional parking needs, added noise, overcrowding of the subject property, perceived incompatibility of STRs as they relate to the preservation of the historic nature of the Old Beach community, and the possibility of excess trash and litter. ■ Recommendation: On January 13, 2021 , the Planning Commission passed a motion to recommend denial of this request by a vote of 6 to 4. If City Council chooses to approve the request, Staff recommends the following conditions: 1 . The following conditions shall only apply to the dwelling unit addressed as 619 25th Street, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. While this Conditional Use Permit is active, parking passes issued for the subject dwelling unit(s) through the Residential Parking Permit Program (RPPP) shall be limited to two resident passes only. Guest and temporary passes through the RPPP shall not be permitted. 4. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 5. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 6. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 7. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' Boa Lo Page 3 of 4 below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 8. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 9. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 10.A11 refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 11.Accessory structures shall not be used or occupied as Short Term Rentals. 12.No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 13.The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 14.The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 15.There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 16.The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 17.To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. Boa Lo Page 4 of 4 ■ Attachments: Staff Report and Disclosure Statements Location Map STR Vicinity Map Minutes of Planning Commission Hearing Letters of Opposition (4) Recommended Action: Staff recommends Approval. Planning Commission recommends Denial. /'- Submitting Department/Agency: Planning Department City Manager: fk 'NIB Applicant& Property Owner Bao Lo Agenda Item Planning Commission Public Hearing January 13, 2021 City Council Election District Beach 24 Virginia Beach Request Conditional Use Permit (Short Term Rental) Staff Recommendation N3� - Approval , ► l.a'J'"'Road ",t 30,str eel lh sues Staff Planner i. oeY, i ', 281h Slred 1 Summer Peebles t,eel 27th 5 4; 2nh sy6e al,sued Location Gha WaPin lane t y.`stoat 1...._ 619 25th Street 1 'G P I N th keel Creek 3rd H229 d Saeel 2417898644 T ,1k 1*ids "s"eet • Site Size " `— �hd Shed 8,400 square feet ,.,,tstreai 264 ,11h Street Existing Land Use and Zoning District ' Single-family dwelling/ R-5S Residential(Old Beach Overlay) Surrounding Land Uses and Zoning Districts North Unimproved Alley Duplexes/R-5S Residential , South 25th Street Virginia Beach Middle School/ R-SS Residential East Single-family dwellings/ R-5S Residential ' ' West Single-family dwellings/ R-5S Residential y _ Mt itile 3 ,..� h o ry y 1 , Bao Lo Agenda Item 24 Page 1 Background & Summary of Proposal Site Conditions and History • This 8,400 square foot parcel is zoned R-5S Residential and Old Beach Overlay Districts. • The subject dwelling was constructed in 2007. • Staff inspected the site on November 17, 2020 to observe site conditions and take photographs for this report. • The property lies within the RPPP boundary, where parking during the evening and overnight hours is limited. Based on this, a condition is recommended that would prohibit the occupants of the STR from parking in the street during the restricted hours. • The applicant accepts City Council's recently imposed conditions reducing the number of bookings in a seven- day period to one and limiting the overnight guest calculation to two per bedroom. Short Term Rentals in the Vicinity A \ .ic IPS1;-I1111 ta ,4 ilk• t,g�t ys iIetIPA"�i�1►J�.:..,.0 +1t� �. - 14 Ise 0000 STATUS rd iiee �� I Q Approved • Denied Tree Q Under Review Atilt S-*SakQ Registered - - -- --__ Map updated on 01.27.2021 Summary of Proposal The applicant submitted a Conditional Use Permit request to operate a Short Term Rental on the subject site. The regulations for Short Term Rental use are identified in Section 241.2 of the City Zoning Ordinance. Specific details pertaining to this application are listed below. • Number of bedrooms in the Short Term Rental: 4 • Maximum number of guests permitted on the property after 11:00 pm: 8-As recommended in condition 16 • Number of parking spaces required (1 space per bedroom required):4 Bao Lo Agenda Item 24 Page 2 • Number of parking spaces provided on-site:4 D RSS D a Cj Zoning History DP i # Request y p 1 STC(Close unimproved portion of right-of-way)Approved 06/26/2001 v �A o `• \ R��` �`Z 2 STC(Closing,vacating and discontinuing portions of right- R ` J of-way)Approved 09/11/2007 &P' 3 STR(Short Term Rental)Approved 02/04/2020 �6b SIrM� R-55 2 Application Types CUP—Conditional Use Permit MOD—Modification of Conditions or Proffers FVR—Floodplain Variance LUP—Land Use Plan REZ—Rezoning NON—Nonconforming Use ALT—Alternative Compliance STR—Short Term Rental CRZ—ConditionalRezoning STC—Street Closure SVR—Subdivision Variance Evaluation & Recommendation This single-family dwelling is located within the Old Beach Overlay.The Old Beach community includes an assortment of development types and uses with Baltic Avenue acting as a separation line between higher and lower density zoning districts.Typically, much of the property east of Baltic Avenue falls within a higher density apartment zoning district, while much of the property west of Baltic Avenue falls within a lower density residential zoning district. Admittedly, exceptions to this statement can be found both east and west of Baltic Avenue.The subject property lies west of Baltic Avenue and was constructed in 2007. City records note the subject address as containing four bedrooms;thus,four off-street parking spaces are required and are provided in the driveway.Since the property is within the boundary of the Residential Parking Permit Program (RPPP), parking passes issued for the subject dwelling unit(s)will be limited to two resident passes;guest and temporary passes will not be permitted while the Conditional Use Permit is active. Based on the considerations above,Staff recommends approval of this request with the conditions listed below.The recommended conditions do reflect City Council's Short Term Rental revisions by reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Recommended Conditions 1. The following conditions shall only apply to the dwelling unit addressed as 619 25th Street,and the Short Term Rental use shall only occur in the principal structure. Bao Lo Agenda Item 24 Page 3 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. While this Conditional Use Permit is active, parking passes issued for the subject dwelling unit(s)through the Residential Parking Permit Program (RPPP)shall be limited to two resident passes only. Guest and temporary passes through the RPPP shall not be permitted. 4. This Conditional Use Permit shall expire five (5)years from the date of approval.The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however,the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints,violations of its conditions or violations of any building, housing, zoning,fire or other similar codes. 5. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two(2))on the property where the Short Term Rental is located.This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1(8a). 6. The owner or operator must provide the name and telephone number of a responsible person,who may be the owner, operator or an agent of the owner or operator,who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 7. If, or when,the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements'a'through 'c' below.This information must be submitted to the Planning Department for review and approval.This shall be done within six(6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration;and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 8. To the extent permitted by state law,each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 9. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23-71 (noise), 31-26,31-27 and 31-28 (solid waste collection), 12-5(fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 10. All refuse shall be placed in automated refuse receptacles,where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31-28. 11. Accessory structures shall not be used or occupied as Short Term Rentals. 12. No signage shall be on-site,except one(1),four(4)square foot sign, may be posted on the building which identifies the Short Term Rental. 13. The Short Term Rental shall have no more than one(1) rental contract during any consecutive seven (7) day period. 14. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 15. There shall be no outdoor amplified sound after 10:00 p.m.or before 10:00 a.m. Bao Lo Agenda Item 24 Page 4 16. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers")shall be two(2) individuals per bedroom. 17. To the extent permissible under state law, interconnected smoke detectors (which may be wireless),a fire extinguisher and,where natural gas or propane is present, carbon monoxide detectors,shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design(CPTED)concepts and strategies as they pertain to this site. Public Outreach Information Planning Commission • 4 letters of opposition have been received by Staff noting concerns about the overall nature of Short Term Rentals in the Old Beach Overlay. • As required by the Zoning Ordinance,the public notice signs were placed on the property on or before December 14,2020. • As required by State Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, December 27, 2020,and January 3, 2021. • As required by City Code,the adjacent property owners were notified regarding the request and the date of the Planning Commission public hearing on December 28, 2020. • This Staff report, as well as all reports for this Planning Commission's meeting,was posted on the Commission's webpage of www.vbgov.com/pc on January 7, 2021. City Council • As required by City Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, February 14,2021 and February 21, 2021. • As required by City Code,the adjacent property owners were notified regarding both the request and the date of the City Council's public hearing on February 15, 2021 • The City Clerk's Office posted the materials associated with the application on the City Council website of https://www.vbgov.com/govern ment/departments/city-clerk/city-council/Documents/BookmarkedAgenda.pdf on February 26,2021. Bao Lo Agenda Item 24 Page 5 Site Layout & Parking Plan , , : ", 133E/1 S Z/1 isalit C.- 8 IS „. k k.2----, .- - s,--- -..-' -!..,.;• i ii i / _ c , 1 t .i • ...4 ti.li 1 :.gt --i 4 tz. -I r mig It k ngle-famL-' • - ; Dwelling-- ., ;k.'711:: . .•V . . ,...._ t ... 1 .. . 1 , . t , -, . q . -:-. .0009 - — r--- M..04..1.9i S id al.0i r --i.1.---, 25th Street Bao La Agenda Item 24 Page 6 Site Photos • '- -zi .'s 4tf. _ ..„ ..: . ,,. ,4 ,-r-410;4-• ' ... . . . ' -'.. ...• '. ,.-,,,,..4,-rt. ,i....."';..'- ' ..°'.,rs."9'oe. .• ( . . - ,i 1 •. , -'-' -• ''V-:- • -7, - 'r--TO, •• ?.-.. -- ":-•17-4 - 1 .. „., ,,,- ,•.1,• --;`-lir- .., i,,• - . - •''- -7-'.,,,,,-•--...ie-71Atiw.1"• - --=• '.-- .4i- -4-,-' : -: ,-*--'S'• - ..'' .• ..!";0:••••*#-#,.,-• .,•-i. , . '•'-: ''"4".. - . - i., .- #. • •. . . .-#.„... . # , - . 1 I \1 • •`• " C;" ' .4.1111111111.1 , • - " -' • •-".-----'l-.1•:"Zt?'"-".•k. —- •-- ,, -, _,-,...• ...,- .-,. ,,.. _ ,..._,_.....,_ . . _„ , , • . . - . .- -.4 . , v..- ' ' ' .• 4. . ,..„ . , „ , , _ .,.. . . •.• = . . , ,,,,„ .....•,, ..,.. •I.),ii,::- ',,.fileTiorp., „ ."'•j .'•.'•'•""*.f'''•-•-4-4-•••-,"•"'•',i- ••'-,'" "-4., "'•- :"",11 ..0:5.3'''',,,, ',, •?• ' . • .,"."'..------•.".."1404, a a•, f•---,.._ ''''''' -.T.,-,... :_ ,....7....,.., 111 • - -ii-V - i'l II \ ._... ..,_ - \ - - - - ..._ .-•_ _ ,‘,., , ......_..„, ....„, , ---- - • . ,. ,. ,,_-„,,, . -1,--fi-• __ -. --:._ - ... _r .. - ,„...._.. --„Ii-:- Bao Lo Agenda Item 24 Page 7 Site Photos tc '� .�.— Via. F 'Y -A:t•, 1,7./A. • 7A--.. ,: • t`4 A. ] f a_{l .....ram..-`�+� . 3• V AEE s, ..is r L;404 .j 5 �. �y Bao Lo Agenda Item 24 Page 8 Disclosure Statement Disclosure Statement \la City ofYirtginto Bms6- Planning&Community Development Owner Disclosure Owner Name Bao Lo Applicant Name Bao Lo Is the Owner a corporation,partnership,firm,business,trust or an unincorporated business?0 Yes No • If yes,list the names of all officers,directors,members,trustees,etc.below. (Attach a list if necessary) • If yes,list the businesses that have a parent-subsidiary'or affiliated business entity4 relationship with the Owner. (Attach a list if necessary) Known Interest by Public Official or Employee Does an official or employee of the City of Virginia Beach have an interest in the subject land or any proposed development contingent on the subject public action?❑Yes II No • If yes,what is the name of the official or employee and what is the nature of the interest? 3"Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. "Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(iii)there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a close working relationship between the entities." See State and Local Government Conflict of Interests Act,Va. Code§2.2-3101. 5I Bao Lo Agenda Item 24 Page 9 Disclosure Statement Disclosure Statement 11/4B.t. Planning&Commun ,Development Owner Services Disclosure 1. Does the Owner have any existing financing(mortgage,deeds of trust,cross-collateralization,etc)or are they considering any financing in connection with the subject of the application or any business operating or to be operated on the property? ❑Yes ■ No • If yes,identify the financial institutions. 2. Does the Owner have a real estate broker/agent/realtor for current and anticipated future sales of the subject property? ❑Yes ■No • If yes,identify the real estate broker/realtor. 3. Does the Owner have services for accounting and/or preparation of tax returns provided in connection with the subject of the application or any business operating or to be operated on the property?❑Yes • No • If yes,identify the firm or individual providing the service. 4. Does the Owner have services from an architect/landscape architect/land planner provided in connection with the subject of the application or any business operating or to be operated on the property?❑Yes ® No • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?❑Yes • No • If yes,identify the purchaser and purchaser's service providers. 6. Does the Owner have a construction contractor in connection with the subject of the application or any business operating or to be operated on the property?❑Yes ® No • If yes,identify the construction contractor. 7. Does the Owner have an engineer/surveyor/agent in connection with the subject of the application or any business operating or to be operated on the property?0 Yes ■ No • If yes,identify the engineer/surveyor/agent. 6I Bao Lo Agenda Item 24 Page 10 Disclosure Statement Disclosure Statement City ofYi noo&,,th Planning&Community Development 8. Is the Owner receiving legal services in connection with the subject of the application or any business operating or to be operated on the property?®Yes ❑ No • If yes,identify the name of the attorney or firm providing legal services. Pierce McCoy,PLLC Owner Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing,I am responsible for updating the information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board or any public body or committee in connection with this application. Feb 10,2021 Owner Signature Bao Lo- Owner Print Name and Title Bao Lo Feb 10,2021 Date FOR CITY USE ONLY/All disclosures must be updated two(2)weeks prior to any Planning Commission and City Council meeting that pertains to the applications ® No changes as of Dite 02/16/2021 signature Print Name Summer Peebles 71 Bao Lo Agenda Item 24 Page 11 Next Steps • Upon receiving a recommendation from Planning Commission,this request will be scheduled for a City Council public hearing. Staff will inform the applicant and/or their representative of the date of the hearing in the upcoming days. • Following City Council's decision,the applicant will receive a decision letter from Staff. • Once the conditions of approval are in place and/or completed,the applicant must contact the Zoning Division of the Planning Department to obtain verification that the conditions have been met. Contact the Zoning Division at 757-385-8074. • If the request requires land disturbance and/or a subdivision of property, please contact the Development Services Center(DSC)to discuss next steps for site plan/plat review. Contact the DSC at 757-385-4621 or the Development Liaison Team at 757-385-8610. • Please note that further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/ Permits and Inspections Division,and the issuance of a Certificate of Occupancy,are required before any approvals allowed by this application are valid. • The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED)concepts and strategies as they pertain to this site. Bao Lo Agenda Item 24 Page 12 .,r .., .... ,, liar. t \ \ \._____ _ -_-`-7----sis . on, \ - le0 y6 ci 6\ _,t .v -0 --,-;\ 1. ' ,, ___._ vo iti .►* �t = �,, ley to t10110.\ ,,. got . * __,..(;) \ '.,, _A.. .1,-,, 0 LU I- toi. -mi.VA '''', II1L- -P°I \ lij‘x WI* \ VOAaNg .0 \ 111.111.--\, Ili -.lot) ilk" ,V,e,L. \ .00 i- 131 U Vo '��'• ;:, a t \' •''' e0100\\ y � 'a V\1.1 c cry o �� �,,,� sl m � �, 1. ./ . _. CI) 0 • 0Q Item # 24 Bao Lo [Applicant & Property Owner] Conditional Use Permit(Short Term Rental) 619 25th Street January 13, 2021 RECOMMENDED FOR DENIAL - HEARD Mr. Dao: The last item on the agenda is the application of Bao Lo for a Conditional Use Permit for Short-Term Rental located at 619 25th in the Beach District. The applicant is Bao Lo. Mr. Bao Lo, please state your name for the record and make your comment. Mr. Bao Lo, please make your comments. Mr. Bao Lo, please make your comments. Mr. Lo: Can you hear me. Mr. Dao: Yes, sir. Please state your name and start your comments. Mr. Lo: I am sorry, I have my representative Scott on the line, he wants to speak for me. Mr. Dao: Mr. Chair, is that permitted. Mr. Weiner: Yes sir. Just please state your name for the record, before you start your comments please. Mr. Dao: Mr. Westfall, please state your name for record and begin your comments. Mr. Westfall we can hear you. So, if you would like to start the comments. Mr. Westfall: So, sorry. Can you hear me now. All right, I apologize, very much. Thank you guys, Planning Commission for your time today. I have to say you guys are marathon endurance runners, so, thank you. I know we are last, I will keep this brief. My name is Scott Westfall, I am an 1 Associate Broker with Broadsight Realty and have been professionally managing short-term rentals and realty vacation rentals in Virginia Beach. I am at the Oceanfront since 2010. I am here today representing Bao Lo owner of 619 25th Street. And, before I get into the details of his application, I would love to just give you a little bit of background of Mr. Lo. Mr. Lo and his family live in Northern Virginia with his wife and his children. They also have family here in Virginia Beach. For the last 25 years, Mr. Lo and his family have visited Virginia Beach four to five times a year to visit family and to vacation. Every time that they have come, they have stayed in short-term rentals and vacation rentals for a week at a time. And, it is been their dream to own their own second home so that they can one-day retire down at the Oceanfront. That dream came to fruition last October when they purchased this property. I had the pleasure of meeting Mr. Lo after he purchased the property, but I do know that he was aware of the short-term rental conditions and made sure that the property met all of these conditions before he purchased the property. When he purchased the property, he also inherited a long-term lease, so the property is currently being rented long-term through the month of May and Bao is honoring that. If granted the permit, Mr. Lo's intentions, and that is really what I want to convey to you guys today, with the property is not to profit from it or to necessarily run a business out of it. In fact, their goal is to have a second home that they can visit and to use themselves when they visit family. And, then secondly, on kind of a secondary goal, would be to offer the home to other families to allow them to have the same experience, to introduce them to Virginia Beach, the same way that they were introduced to Virginia Beach through a vacation home. And, ultimately their goal is in the next 10 years to retire here and to move here. So, Mr. Lo's thoughts of that, it is definitely in his best interest not to make enemies 2 with his neighbors. And in order to comply with City regulations and to really minimize the impact on the neighborhood, Mr. Lo has agreed to no events, the new conditions for seven nights, so only one contract in seven nights and really Mr. Lo's goal would be to only allow seven night minimum rentals in the summer, and his plan would be to, if any rentals are allowed in the winter, to be monthly because that is the time his family likes to enjoy the property. He also, in addition to having family members nearby, will employ professional onsite management. So, they do plan to market the property on VRBO, not Airbnb, but only VRBO. They are going to be in communication with guests pre and post stay and are able to provide a professional onsite management company with a number for both neighbors and tenants, 24/7 emergency onsite maintenance, as well as response to any kind of issues that may arise. With that said, Mr. Lo wishes to honor the neighborhood and to respect the neighborhood, like I said they come down here often and will be a part of this community, although they do not live here permanently. They are here often as I said to visit many family members in the area. And, with that, I would love to answer any questions. I do personally feel that this property meets the requirements and kind of what vacation rentals have been in Virginia Beach for a long time, the goal is not to be a nightly rental or three night rental or to really be a profit center, but to be a second home and to be able to offset some of the costs that are associated with that. Mr. Weiner: Thank you, sir. Any questions or questions. No questions. Hoa, next speaker. 3 Mr. Dao: The last speaker is Carrie Chick. Ms. Chick, please start by stating your name for a record before beginning your comments. Ms. Chick, you may begin your comments. Mr. Weiner: Does it show that she is online? Mr. Dao: That was the last speaker. Mr. Weiner: Let us give her one minute. Ms. Smith: Can you hear us Ms. Chick. Ms. Chick: Can you hear me now. Mr. Dao: Yes, ma'am. Yes, please start your comments. Ms. Chick, please start your comments. Ms. Chick: Hello, can you hear me now. Mr. Dao: Yes, we can hear you. Ms. Chick: Awesome, thank you so much. One, I do not want to be the last person holding everyone up from getting home today and I appreciate the well-thought out discussion about the new neighbors and I appreciate some of the obvious responses to many of our neighbors and my considerations and concerns. So, my name is Carrie Chick, I live on 625 25th Street, the direct neighbor of this house, and, I have submitted a letter as well as more detailed information in there, but I also just wanted to make sure that I was getting a little more contextual information in case any of that came up and provide a voice to a name as well. So, my main concern is at the end of the day this application has a different feel than a lot of the other short-term rentals that are in this area, and some of the concerns have been addressed, but I still have some other ones. One, being if you have ever driven by this house, this house is very different than the small cottages that generally make up a majority of the homes in Old Beach. So, I am questioning whether or not 4 setting precedence for tearing down these cottages and building up these larger houses that look very similar to Oceanfront houses and creating rental properties from them. And, generally speaking, the Old Beach neighborhood is a historic neighborhood, that is based around preserving the historic status of Old Beach, and it is the first residential area of the Oceanfront Resort Areas and it provides new opportunities for new and redeveloped resort residential areas. So, while it is near the Oceanfront, it is nestled back far enough that it is a neighborhood, and it does not have a lot of tourists that do come back there. So, the recent purchase of the house allowed for the current long-term renters stay there for a period of time before switching over to this new short-term rental application. And, at no point, the current owners have ever lived there, despite the fact they have come and visited the area before. I know the neighbors have said that they tried to reach out to the owners and they have yet to reach back out to us and that was a little bit of concern, but some of that has been addressed. But, one of the areas that we are still concerned about is some of the short-term rental requests that are in the area. So, for example, it says that it is four bedroom house, this is actually a five bedroom house and four bedroom house there is apartment below, so, is that being rented separately or is that part of the overall rental. If that the case, than the actual occupancy needs to be adjusted as well as parking. Parking is also a concern because we have had previous problems and there has been more restrictions put in the area. But, people parking in the streets and blocking houses and just walking in the road in general. And, then the other area of concern is around how is that going to be enforced. While there are other short-term rentals in this area, they are small, they are one to three bedrooms, they fit a family. And, generally speaking, it is not going to be a loud party. This house has four very large balconies, 5 where people can party outside within neighboring vicinities of the houses, and because this is a neighborhood it echoes, you can hear everything. So, everyone in the area is genuine very respectful of the fact that people work the next day, that they have young children in bedrooms that are nearby, and the concern is that if you are going to be renting this out in general vacation mentality, those documents are amazing, however Mr. Dao: Ms. Chick that is all the time you are allowed, thank you for your comments. Mr. Chair. Mr. Weiner: Are there any questions to the speaker, Ms. Oliver. Ms. Oliver: I am sorry, I do not have one for the speaker, I have one for the Staff. Mr. Weiner: All right, any questions for the speaker, Mr. Inman, Mr. Alcaraz. Mr. Alcaraz: Okay. Are you still there? Ms. Chick: How is there going to be regulations on the individuals that are going to be there. Mr. Weiner: Ma'am. Your time is up and we have questions for you from the Commission, please. Hello, can you hear me? Ma'am can you hear me. Hello, ma'am are you there? Mr. Dao: She is on Mr. Chair. But I believe she cannot hear us. Mr. Weiner: Mr. Alcaraz, would you like to make a comment or do you have a question? Mr. Alcaraz: I just wanted to know where she lived, I think she said she lived next door and she live in a duplex or single family. I was just going to see where she lives. Ms. Chick: I apologize I could not hear the question. 6 Mr. Alcaraz: Yes, ma'am. Ms. Chick you said you live next door is that you facing the house, are you on the left and right, are you in a single family house, are you in a duplex? Ms. Chick: I am in a single family house on the left. Mr. Alcaraz: Okay. Mr. Weiner: Mr. Inman, do you have a question. Mr. Inman: Yes, I'd like the speaker to go back to the comment about you tried to reach out to the owner and was not successful. Can you elaborate on that. Ms. Chick: I apologize. Is that a question for me? Mr. Inman : Can you hear me. Mr. Weiner: Yes, Ms. Chick that was a question for you. Ms. Chick: Okay. I did not reach out because there was no contact information. That was in reference towards other neighbors stating that they reached out to them and did not get a response. Mr. Inman: Okay, thank you. Mr. Weiner: Any other questions for Ms. Chick. Okay, thank you ma'am. Did the applicant's speaker want to make any more comments or rebuttal? Mr. Westfall: Yes, I would like to address a few of her concerns, if possible. We fully understand your concerns and really do want to address that the property is in the tax records a four bedroom and I do not know the fifth room you are talking about. We addressed this with the Planning Department and the Staff when we were going through the application and it needed to meet what the tax record said. We had agreed to keeping it to two people per bedroom, so, the max occupancy of adults would be eight total. So, it is a four bedroom and to just address the concern of what will be used in that space, it 7 will not be used for additional guests, we are not looking to pack the house. And, Mr. Lo is truly looking for a family. Also, on the parking, if you can look at the survey, we only added four spots but there is an additional space for another spot in the driveway as well as two spots in the garage and I cannot remember the specifics on the garage right now or where that actually is at, but we do address that we do not plan on using any kind of street parking or permits from the City to give to guests, only the parking in the driveway. And, finally, on just addressing tenant impact and we cannot control guests, but I firmly believe that communication is key and that is why the Lo's want to be a part of the process and communicating with the guests on the front end of what their expectations are with the house, how the house is supposed to be handled, and also letting them be aware that this is a neighborhood that they also will be a part of. So, to address that I think The Lo's just want to make sure that they are communicating to their guests and it will be clear to them, the expectations that are set. Mr. Weiner: Okay, thank you sir. Any questions for the speaker? No questions. Okay, that was our last speaker. Hoa, Correct. Mr. Dao: That is correct. Mr. Weiner: Thank you, we will close this to the public and open it up amongst ourselves. I think Ms. Oliver, did you have a question you wanted to ask Staff? Ms. Oliver: Well, I guess I can, I am not sure I understand the fifth bedroom. Is that a separate apartment or is it a fifth bedroom. Ms. Peebles: I can answer, that is actually according to the Assessor's Office is not considered a bedroom, so, it is a study-den and essentially it is not actually a fifth bedroom. So, we were able to work out when he submitted his application, according to the City Assessor's record, it 8 does not meet the definition of a bedroom, which is why we have this as four bedroom and so it is a den-study. Ms. Oliver: Thank you. Mr. Weiner: All right, Mr. Alcaraz. Mr. Alcaraz: I am having trouble too, so just bear with me. I have received some opposition, my concern is that it is not in our future plans or where we want to have the short-term rentals and because of that, I have got some reservations about it. I wanted to hear from the other Commissioners their thoughts, but other than the next door Ms. Chick, I have gotten a couple emails, but I guess my concern is voting on this with knowing what is coming down the pipe for this area, and more or less a residential R5-S Residential District, but I would like to hear from the other Commissioners. Mr. Weiner: Mr. Inman. Mr. Inman: Thank you, first the question for Staff. lit looks like the little map and material shows a number of other existing short-term rentals in the immediate area or applications pending in that market. Am I interpreting that right? Ms. Peebles: Correct. Mr. Inman: I have got a lot of concern about this particular one, and as soon as I saw it,when especially when I saw the parking plan,which of course does meet requirements. But, immediately envisioned how many people could be there, not just the visitors and I know the restrictions on staying there overnight could only be eight. But, even so, I just do not see this fitting into this neighborhood. I see potential problems and the fact that it does have that extra parking on site makes it frankly more concerning to me that it gives the opportunity for more 9 cars to be there, and more people to be there. I am just thinking this is not a good fit for the neighborhood. That is it. Mr. Weiner: Any other comments, Mr. Graham you had a hand up. Mr. Graham: Obliviously, it is west of Baltic Avenue, it is actually as far west as you can go in the Old Beach Area. I share the concern that a couple of the other Commissioners have expressed. Unless, I hear something different will not be supporting it. Mr. Weiner: Any other comments. Mr. Coston: Yeah. I do not know, you just deny a person who meets all the conditions, except for his house is a little bit bigger or he can fit a few more cars on this parking program. So, I will be voting in favor of it, it looks like the ideal situation. Someone who cares enough and wants to move here eventually and looks like what you would rather see less rentals, as in he visits often with family and friends, so, I will support it. Mr. Weiner: Mr. Redmond. Mr. Redmond: Yeah, I am not sure how anybody could come away with any sort of confidence in the consistency of what we do, if we criticize them for having not enough parking and then criticize them for having too much parking. So, is it too hot or is it too cold, is it to somewhere in there. I guess the porridge is supposed to be the right temperature, but I thought having adequate parking was supposed to be a good thing and like Mr. Coston, I think when you check all the boxes and we have ample parking, probably you have done, you got something that you ought to be rewarded for. So I am going to support it as well. Mr. Weiner: Mr. Inman. 10 Mr. Inman: My last ditch effort will be to say, what if we were to have reduced the occupancy to two bedrooms. That way, it can be used for that purpose to short-term rental purpose when the family is not staying there themselves or having friends visit. Does anybody, care to support that? Mr. Weiner: Ms. Oliver, has her hand up, let us see what she has to say. Ms. Oliver: A s much as I would like to support that Mike, I do not even know how we begin to monitor anything like that. And, my problem with this is that everything that we have discussed, this is not going to be part of the Beach District Overlay. So, I am not quite sure what we wanted to do with this, because of that and everything that we have got going forward, I just am not going to be able to support this one. So, that is where I am with that;just so everybody knows, Mr. Weiner: Anybody else? I would like to add something, if I could. I know we have been talking about the North Beach North End Overlay, we do not even know if we are going that direction. So, I am not even keeping that in the back of my mind right in the second. I personally do not like it and I am probably not going to support it. So, I am not going to go that direction, but I am going to go back to what Whitney said, as a Commission being consistent, we about a year ago, we sent it to Council anything less than Baltic in this area that we did not want short-term rentals and we sent that and we have not approved one since we sent that and I think that is consistent. If we stay with that this is a historic area and if you remember we did that, we sent it to Council like that so I am going to stick with that and I am not going to be able to support this one either. In saying that, no other comments. Anybody want to make a motion? Mr. Alcaraz, is it your area. 11 Mr. Alcaraz: Yeah. As I stated, because of the opposition and I think because where we are going for that area, just east of it and this being in our R5-S district, I am going to go ahead and recommend denial for the application. Mr. Weiner: Do we have a second? Mr. Graham: Second. Mr. Weiner: So, we have a motion for denial by Mr. Alcaraz and a second by Mr. Graham. We are ready for the vote. Ms. Coleman: If you are in favor of the motion please say, yes. And, if you are opposed say, no. The motion is to deny the application. Ms. Coleman: Mr. Alcaraz. Mr. Alcaraz: Yes. Ms. Coleman: Mr. Barnes is absent. Mr. Coston. Mr. Coston: No. Ms. Coleman: Mr. Graham. Mr. Graham: Yes. Ms. Coleman: Mr. Horsley. Mr. Horsley: No. Ms. Coleman: Mr. Inman. Mr. Inman: Yes. Ms. Coleman: Ms. Klein. Ms. Klein: No. Ms. Coleman: Mr. Redmond. Mr. Weiner: I think he said no. Ms. Coleman: Okay, thank you. Ms. Oliver. 12 Ms. Oliver: Yes. Ms. Coleman: Vice Chairman Wall. Mr. Wall: Yes. Ms. Coleman: And, Commissioner Weiner. Mr. Weiner: Yes. Ms. Coleman: By recorded vote of six for and four against Agenda Item Number 24 has been recommended for denial. AYE 6 NAY 4 ABS ABSENT 1 Alcaraz AYE Barnes ABSENT Coston NAY Graham AYE Horsley NAY Inman AYE Klein NAY Oliver AYE Redmond NAY Wall AYE Weiner AYE CONDITIONS: 1. The following conditions shall only apply to the dwelling unit addressed as 619 25th Street, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241 .2 of the City Zoning Ordinance or as approved by City Council. 3. While this Conditional Use Permit is active, parking passes issued for the subject dwelling unit(s) through the Residential Parking Permit Program (RPPP) shall be limited to two resident passes only. Guest and temporary passes through the RPPP shall not be permitted. 4. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the 13 Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 5. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 6. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty (30) minutes. Physical response to the site of the Short Term Rental is not required. 7. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 8. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 9. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 10. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 11. Accessory structures shall not be used or occupied as Short Term Rentals. 14 12. No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 13. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 14. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 15. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 16. The maximum number of persons on the property after 11 :00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 17. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards. All applicable permits required by the City Code, including those administered by the Department of Planning / Development Services Center and Department of Planning / Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED) concepts and strategies as they pertain to this site. 15 Robert Bryant January 6, 2021 609 25th St Virginia Beach, VA 23451 The Planning Dept e-mailed niGarrido@vbgov.com 2875 Sabre St Suite 600 Virginia Beach, VA 23452 reference Bao Lo Va Beach, VA 23451 applicant: Dear Sirs, Do not want weekly rental next door: at Lo Bao's property, for one there is not enough parking for the very large lovely home. Do not see where it would help anyone to have so many people in one large home in a resident location. Sure things will change as we grow but with correct things in place. We are across the Street from a school (in a residential area) which would not need a good party home for their viewing either. It has been a yearly rental. We have had a few problems with parking and we are able to speak with them and make it better for all parties not counting the seller of the home. (he did not help). Appreciate your response and not allowing a group of people in a small area to party not in a good way. Regards, (411.1"A Robert Brya t Kerri C Chik Jesse Wilson 625 25th Street Virginia Beach, VA 23451 January 1st, 2021 TO: Virginia Beach Planning Commission SUBJECT: Conditional Use Permit (Short Term Rental Request 619 25th Street) REF: Item#24 Dear Chairwoman Oliver and Members of the Virginia Beach Planning Commission Committee— Our community and others state and nationwide are grappling with the issue of private residential areas for short-term accommodations.This practice, referred to as vacation rentals (or short-term rentals), has recently elicited significant controversy over the proper use of private residential stock within residential areas.Although vacation rentals have historically been part of our oceanfront community for decades, the more recent introduction of online booking sites has resulted in a surge of vacation rentals closely bordering private residents and an increased concern on how to ensure that private residents rights are being respected and heard as full-time members of the Old Beach community. As a full-time Old Beach resident as well as a previous short-term rental host,the purpose of this letter is to address the conditional use permit for 619 25th street (GPIN 2417898644, Acccela Record(s) 2020-PCCC-00302). While this neighborhood is in close vicinity to the boardwalk and oceanfront that many out of town guest enjoy,the Old Beach neighborhood is mainly compiled of full-time residents that have jobs and children who generally adhere to respectful neighborhood behaviors(e.g., no loud music, nighttime partying, littering, excessive cars parking/blocking the street) as well as invested in the neighborhood based upon the premise of preserving the historic status of first residential areas within the oceanfront region. Based upon the vacation mindset to relax and take a break from the everyday responsibilities, there is a concern that a short-term rental will bring in clientele that will provide a positive impact on the local economy but potentially have excessive noise, littering, and unruly behavior and drive our full-time residents. As the neighboring house, our specific concern is that the large balconies in the house are in direct vicinity to neighboring properties and can be extremely susceptible to loud and late-night noises (e.g., bedroom windows). It is also our understanding that the owners do not live nearby to closely monitor the property in comparison to many of the other short-term rentals in the area. Specifically, we have outlined the following questions for the committee below: 1 1. Accuracy of Short-Term Rental Request o The residence is a four-bedroom/four-bathroom house but also contains a one- bedroom/one-bathroom apartment making it a 5 bedroom/five-bathroom home.The accuracy of this request would impact the amount of required parking and maximum occupancy. 2. Parking o Does the house have enough parking spots to accommodate the number of rooms? 25th Street has historically had problems with oceanfront visitors parking on the side of the streets and blocking driveways and inhibiting traffic. o In addition,the house is registered as only have two parking spots (see Zillow link: 619 25th St, Virginia Beach,VA 23451 I Zillow). 3. Maximum Rental Occupancy o See note in 1 Accuracy of Short-Term Rental Request o How will this be enforced? 4. Events o Based upon current event restrictions, how will this be monitored? Based upon the current house side, 5. Physical Location of STR Owners o STR owner must physically respond to the property within 30 minutes if an emergency arises. o With the owners not living nearby, how does the STR owner plan to address any potential issues? While we want to continue to see our city benefit from the hospitality industry, we are looking forward to having our concerns addressed so that we can continue to stay as private full-time residents and watch the Old Beach community continue to thrive for years to come.Thank you for taking our comments into consideration and please do not hesitate to reach out if you have any questions or need additional information. Kind Regards, ` bf,„„: Kerri Chik and Jesse Wilson 625 25th Street Virginia Beach,VA 23451 Kmec730@gmail.com 2 Nancy K. Parker 513 23rd St. Virginia Beach, VA 23451 Planning Commission Meeting January 13, 2021 REF: Item #24 Short Term Rental Request 619 25th Street Dear Chairwoman Oliver Members of the Virginia Beach Planning Commission: I have been a resident of the Beach District for over 50+ years and seen many changes as the Old Beach neighborhood has evolved into a primarily year-round stable residential community. I love my neighborhood. I am opposed to the request for a Short-Term Rental at 619 25th Street for the following reasons: The City Council on December 20, 2005, established the Old Beach Overlay District (Article 19) with the specific following legislative intent (Section 1900). "The purpose of the Old Beach Overlay District is to preserve the historic status of the Old Beah neighborhood as one of the first residential areas within the Oceanfront Resort Areas by providing opportunities for new and redeveloped resort residential development, characterized by single-family cottage-style homes and compatible multiple-family residential dwelling." The reoccurring word and theme is residential. The property at 619 25th Street was bought October 2020 for approximately $660,000. It is surrounded by quintessential beach cottage homes and is six blocks from the ocean with some grandfathered STRs in the immediate area. Now the new owner/investor wants to flip it into a Short-Term Rental. This request is NOT in the commercial Oceanfront Resort District which is from 17th to 22nd Street as is being proposed by the guidelines in the Jones-Wood Short Term Rental Ordinances. This is in an area classified as residential neighborhood. Short Term Rentals are a business entity and not compatible with residential neighborhoods. These business entities are not neutral nor are they benign in nature. They have a profound and compounding impact on the neighborhood quality-of-life as you are finding throughout the city. While my home is not next door, given the nature of this neighborhood, we are close and all within walking distance of a few blocks. We are a small compact primarily year-round residential neighborhood community. It is very easy for an investor/owner that lives outside of the neighborhood on their golden pond and will not have their quality of life impacted to throw my neighborhood under the bus. This is not a stand-alone, one-time vote with no repercussions for the rest of this area. How many more are you ready to approve? I respectfully request you deny this Short-Term Rental. Thank you for your time and consideration. Respectfully, Nancy K. Parker From: Marchelle L.Coleman To: Marchelle L.Coleman Subject: FW:Attn:January 13,2021 Meeting-Virginia Beach Planning Commission Date: Wednesday,January 13,2021 7:32:41 AM From:Tim H.Thomas<timhthomas10( icloud.corrl> Sent:Tuesday,January 12, 2021 9:24 PM To: branch.oliverPgmail.com Subject:Attn:January 13, 2021 Meeting-Virginia Beach Planning Commission CAUTION:This email originated from outside of the City of Virginia Beach.Do not click links or open attachments unless you recognize the sender and know the content is safe. Attn: January i 5, 2021 Virginia beach Planning Commission IV eeting Dee Oliver, Chairwoman & Members Maryben and i and have keen residents of the Old beach borough District for over+7 years. We moved into our first residence on 241 2 Mediterranean Avenue in the 500 block of 2.5th Street during 1974,At that time we had our 2 young sons at home with us. During 2008 we renovated our residence and relocated to our current residence located at 528 25th Street. This residence has keen my family home since the late i 950's. We love our Virginia beach neighborhood as this is a very family oriented community that appeals to us. We are opposed to another Short Term Rental located at 6 i 9 25th Street. Our main concerns are for the lack of parking for suck a large hone that was originally constructed as a single family dwelling. Parking and traffic have keen an age old problem for our area. Now we are being faced with an explosion of Short Term Rentals that further confuses our situation. We would appreciate your consideration of the impact of these developing interests. Thank you very much. Sincerely, Tim 6, Mar9ben Thomas 528 25thjtreet Virginia beach, VA 2545 I-4042 757-428-0744 TPPIPIIrCLlr, " i riposigir_______„... \ . \\ , \ , k \ 0 \ , . , ... ii, 1 III o , R5S OR - - \ OR k \co OR /70J) , "P..4w li ill Norf -- ,> = gth Set •--- o"I Avenue ,. o IP ilk r \_, 1 co11 OR 1 co N V A Site William Joseph Wright,. Jr. W.,0 ,, Property_Polygons 911 Pacific Avenue, Unit B _- s Zoning Building mmt=i Feet PLAN TRANS SURFACES 0 15 30 60 90 120 150 180 c ,...707,44,.. f� 1,, 4 'J L '/ 4, ♦,./ CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: WILLIAM JOSEPH WRIGHT, JR. [Applicant & Property Owner] Conditional Use Permit (Short Term Rental) for the property located at 911 Pacific Avenue, Unit B (GPIN 24272444111030). COUNCIL DISTRICT — BEACH MEETING DATE: March 2, 2021 • Background: The applicant is requesting a Conditional Use Permit for Short Term Rental on a 35,000 square foot lot zoned OR Oceanfront Resort District. The lot consists of two multi-family building types constructed in 1969. The subject unit is located within the southernmost building and contains two bedrooms. The minimum number of parking spaces required for the Short Term Rental is one per bedroom, or two spaces in this instance. The maximum occupancy for guests on-site after 11 :00 p.m. for a two-bedroom Short Term Rental is 6; however, at the time of this writing, the applicant accepts with City Council's recent Short Term Rental condition revisions reducing the number of overnight guests permitted to two per bedroom and limiting the number of bookings in a seven day period from two to one. These changes are reflected in the conditions below. • Considerations: The site is located within the resort area of the oceanfront and sits approximately two blocks from the public beach of the Atlantic Ocean. The surrounding community is a mixture of commercial uses, hotels, and other multi-family developments. The subject unit has one dedicated parking space on-site; however, because two are required, the second space will be located off-site. This off-site space will be leased annually and is situated within the 9th Street Municipal Parking Garage. As permitted by Section 241.2(1) of the City Zoning Ordinance, the Zoning Administrator found this parking arrangement to be acceptable. In addition, the remaining requirements of Section 241 .2 of the Zoning Ordinance pertaining to Short Term Rentals can be reasonably met by the applicant. Staff received one letter of concern relating to this request. The letter was sent by the owner of the unit above the subject address. While not specifically opposed to the applicant's request, the neighbor explained in their letter that they feel the Short Term Rental applicants should be made to provide a set of the association's rules and regulations to all who rent the unit. The letter continues by describing a need for the applicant to obtain proper identification from the renters and to ensure that smokers do not engage in the act of smoking inside the home. William Joseph Wright, Jr. Page 2 of 4 • Recommendations: On January 13, 2021, the Planning Commission placed this item on the Consent Agenda, passing a motion by a recorded vote of 10-0, to recommend approval of this request. 1. The following conditions shall only apply to the dwelling unit addressed as 911 Pacific Avenue, Unit B, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. Proof of ability to use at least one off-street parking space at a location acceptable to the Zoning Administrator shall be provided to the Planning Department on an annual basis as long as the Conditional Use Permit is active. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements `a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and William Joseph Wright, Jr. Page 3 of 4 c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10.Accessory structures shall not be used or occupied as Short Term Rental. 11.No signage shall be on site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12.The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13.The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14.There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15.The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16.To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors shall be installed in each Short Term Rental. ■ Attachments: Staff Report and Disclosure Statements Location Map STR Vicinity Map Minutes of Planning Commission Hearing Letter of Concern (1) William Joseph Wright, Jr. Page 4 of 4 Recommended Action: Staff recommends Approval. Planning Commission recommends Approval. Submitting Department/Agency: Planning Department 0 ,7i-V City Manager: Applicant & Property Owner William J. Wright, Jr. Agenda Item Planning Commision Public Hearing January 13, 2021 �' City Council Election District Beach City of 26 Virginia Beach Request Conditional Use Permit (Short Term Rental) Staff Recommendation i:S7 ,_.v. _4\ -----1" ,n„st•�' 1'. Approval Wc9'^"Beach two.' Lacd Stitt'Wee Staff Planner A m 061i, Jenizza Badua 650st'•et a ` sat s Location s 911 Pacific Avenue, Unit B 12t„stt a <0 4 p0 e 'I Ac NoddkA - I+ GPIN � to% met 24272444111030 ytt 5tt va,�e AttcY Macit•^da Pve^ae Q,„,, re ,c o on s"eet Site Size p V c9` Ala 'vas ' S et A St, tce 34,996 square feet ' °Ga° H+4hC u► nth street a p R — vd suot • o • y — Existing Land Use and Zoning District V. - _" / ,'J �=`= Multi-family dwellings/OR Oceanfront Resort Surrounding Land Uses and Zoning Districts North 4. a Duplex dwellings, commercial parking lot/OR ` Oceanfront Resort n is South r ' 9th Street II1. Municiapl parking garage/OR Oceanfront b ,,; •'t Resort - ;� East ; :�,.. s Retail shops/OR Oceanfront Resort A' West ..:F - Pacific Avenue ���-' „ , v, n -vi Off-site parking lot/OR Oceanfront Resort Norfolk AYM,iei � s = r,-- _, i l t William J. Wright,Jr. Agenda Item 26 Page 1 Background & Summary of Proposal Site Conditions and History • The 35,000 square foot parcel is zoned OR Oceanfront Resort District. • City records indicate that the multi-family condominium complex was constructed in 1969. • Staff inspected the site on November 12, 2020 to observe site conditions and take photographs for this report. • One on-site parking space in the parking lot is designated for the 2-bedroom unit. There is no on-street parking on this portion of Pacific Avenue. • Five Short Term Rental application requests have been approved within the condominium complex, Retreat by the Sea,thus far. All five approved applications have leased their second required parking space off-site at the 9th Street Municipal Garage, which is located immediately across the street south of the complex. • One of these approved five Short Term Rental properties, 909 Pacific Avenue, Unit A, is also owned by the applicant and was approved by City Council in August 25, 2020. • No records of zoning violations relating to Short Term Rental use were found associated with the subject address. Short Term Rentals in the Vicinity 3i Ol\c`V____:,.. ►I �4,4ia� \ \ 40% •\ iii „, I r il r1• 1 .� O . Vcae r ' -- f��l c-.. A \ a: WA 1WILI � II sth `` \\ vt Ilk ila,liar et 'STATUS 9t ', ® Approved 0 \ \ .. \ • Denied ..lir OUnder Review r �� t`v`'>�� 6�$�e Registered ,,*,is e 1 •, Map updated on 01.27.2021 William J. Wright,Jr. Agenda Item 26 Page 2 Summary of Proposal The applicant submitted a Conditional Use Permit request to operate a two-bedroom Short Term Rental on the subject property. The regulations for Short Term Rental use are identified in Section 241.2 of the City Zoning Ordinance. Specific details pertaining to this application are listed below. • Number of bedrooms in the Short Term Rental: 2 • Maximum number of guests permitted on the property after 11:00 p.m. (maximum 2 per bedroom):4 • Number of parking spaces required (1 space per bedroom required): 2 • Number of parking spaces provided on-site: 1* *A second parking space will be leased at the 9'Street Municipal Garage located across the street. \ e J� f?,c. C- -1- R-5s Lakairiv j \1 \_._ 00,gUeet r' \OR /' Zoning History ass Rss `�. \:r --";:', \V 1 � `,, I3 � 2 STR Approved 02/4/2020 � STR Approved 06/9/2020 Norfolk A Stole _ �n� STR Approved 08/25/2020 { STR Approved 08/25/2020 - 8 \re `', STR Approved 10/20/2020 �� x P'\--, R$5 ' OR B�Sty"' __ OR Application Types CUP—Conditional Use Permit MOD—Modification of Conditions or Proffers FVR—Floodplain Variance LUP—Land Use Plan REZ—Rezoning NON—Nonconforming Use ALT—Alternative Compliance STR—Short Term Rental CRZ—ConditionalRezoning STC—Street Closure SVR—Subdivision Variance Evaluation & Recommendation The applicant is requesting to operate a two-bedroom Short Term Rental unit within the Retreat by the Sea condominium development located at 911 Pacific Avenue, Unit B. Two parking spaces are required for the two-bedroom unit. One designated parking space on-site will be available for the renters and the second space will be met off-site. The applicant has signed and submitted a letter of intent to lease the second parking space at the 9th Street Municipal Parking Garage,which is conveniently located across the street just south of the condominium complex. The Zoning Administrator has approved the applicant's parking plan. As recommended below in Condition 2,the applicant will be required to submit receipts or proof of availability of a second off-street parking space annually to the Zoning Administrator while the Conditional Use Permit remains active. William J. Wright,Jr. Agenda Item 26 Page 3 All requirements of Section 241.2 of the Zoning Ordinance regulating Short Term Rentals can be reasonably met with this application. Based on the considerations above,Staff recommends approval of this request with the conditions listed below. Recommended Conditions 1. The following conditions shall only apply to the dwelling unit addressed as 911 Pacific Avenue, Unit B, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. Proof of ability to use at least one off-street parking space at a location acceptable to the Zoning Administrator shall be provided to the Planning Department on an annual basis as long as the Conditional Use Permit is active. 3. This Conditional Use Permit shall expire five (5)years from the date of approval.The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however,the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints,violations of its conditions or violations of any building, housing,zoning,fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight(number of bedrooms times two (2))on the property where the Short Term Rental is located.This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person,who may be the owner, operator or an agent of the owner or operator,who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30)minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when,the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements'a'through 'c' below.This information must be submitted to the Planning Department for review and approval.This shall be done within six(6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration;and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law,each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23-71 (noise), 31-26, 31-27 and 31-28(solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks),and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles,where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31-28. 10. Accessory structures shall not be used or occupied as Short Term Rental. William J.Wright,Jr. Agenda Item 26 Page 4 11. No signage shall be on site,except one(1),four(4)square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7)day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers")shall be two(2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors(which may be wireless), a fire extinguisher and,where natural gas or propane is present, carbon monoxide detectors shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED)concepts and strategies as they pertain to this site. Public Outreach Information Planning Commission • As required by the Zoning Ordinance,the public notice signs were placed on the property on or before December 14,2020. • As required by State Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, December 27, 2020,and January 3,2021. • As required by City Code,the adjacent property owners were notified regarding the request and the date of the Planning Commission public hearing on December 28, 2020. • This Staff report, as well as all reports for this Planning Commission's meeting,was posted on the Commission's webpage of www.vbgov.com/pc on January 7, 2021. City Council • As required by State Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, February 14, 2021, and February 21, 2021. • As required by City Code,the adjacent property owners were notified regarding both the request and the date of the City Council's public hearing on February 15, 2021. William J.Wright,Jr. Agenda Item 26 Page 5 • The City Clerk's Office posted the materials associated with the application on the City Council website of https://www.vbgov.com/government/departments/city-clerk/city-council/Documents/BookmarkedAgenda.pdf on February 26, 2021. William J.Wright,Jr. Agenda Item 26 Page 6 Site Layout & Parking Plan k� / , �„ `�. ... ... ___ i _ ...e. _ .-• he Sea Retreat by t •-717ff .i} • • 1 . r0 Al 1 1 ParKing Spaoe ill, ��0 i, 0,0 \\\ \ \ \ ` \a 4 T '. t 911 UNIS A tiv., ems+' ,.�.. _. _ ii , . __ s Mt A .. ,., ,. 9th Street . 6 _ � ' th Street Garage 9 #2 O“.Site . A ': �,,., ,. Par Pa King space 1 • • • t • • i 4 , f • ,c. aim¢: � i , William J. Wright,Jr. Agenda Item 26 Page 7 Site Photos ry 4 6-4 fl1011 !hi 11 • William J. Wright,Jr. Agenda Item 26 Page 8 Site Photos kic I ,„ ,,s,, H ,j.,...;i,... ,, iv.,, — -- . ,,. ,,i-,tt —A— liIMO r--- , ,:,,,. • .. , . . M. I . ! — - 11-. .. .....-. 11 , 1 ..-.•,in• ___!"-_. to•• -Ilk,..i,.....7- ••' 111 .'' - • ii. , . -• . . _LL * --____ •- . - -- - T,1, ., \ :' ') - •t'k IA A‘Cf9: . -v-" 11 ki 1 .,' ••:':. / - ' .‘'•• ' -.If 1..'''' ,L, ••L'i ,l'L. •' ' .---/:_ ,:•,. \-..' l't r • 4011- I -,, ;_):' _,. ,., ri 1 _ .... . 11..;ir77:1 ill' r ---1----'--7- . , ' • i "1- • ., 0= •=, ' ' " -. ' ''-=2• ! 4 , -- - - .,..._— ,--- --.; / -."..; \ .: ' I':•:'1' , \\- . i o ., • • o.. . , - Is , '•' , • 20-, • .:=.:.,,,:-,-:; -„, . ....,;;- •fs's-- - _\„, ---__ - . , • William J. Wright,Jr. Agenda Item 26 Page 9 Disclosure Statement Disclosure Statement AIM: Planning&Community Development 1 he disclosures contained in this form are necessary to inform public officials who may vote on the application as to whether they have a conflict of interest under Virginia law. The completion and submission of this form is required for all applications that pertain to City real estate matters or to the development and/or use of property in the City of Virginia Beach requiring action by the City Council or a City board,commission or other body. Applicant Disclosure Applicant Name William J.Wright, Jr. Does the applicant have a representative? 0 Yes No • If yes,list the name of the representative. Is the applicant a corporation,partnership,firm,business,trust or an unincorporated business?❑Yes IN No • If yes,list the names of all officers,directors,members,trustees,etc.below. (Attach a list if necessary) • If yes,list the businesses that have a parent-subsidiary'or affiliated business entity'relationship with the applicant. (Attach a list if necessary) '"Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or Indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. "Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(ill)there is shared management or control between theOgsirksisanities. Factsgs that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a close working relationship between the entities." See State and Local Government Conflict of Interests Act,Va. Code§2.2-3101. 1I William J. Wright,Jr. Agenda Item 26 Page 10 Disclosure Statement Disclosure Statement City ci*yaw h % Planning&Community Development Known Interest by Public Official or Employee Does an official or employee of the City of Virginia Beach have an interest in the subject land or any proposed development contingent on the subject public action?❑Yes r No • If yes,what is the name of the official or employee and what is the nature of the interest? Applicant Services Disclosure 1. Does the applicant have any existing financing(mortgage,deeds of trust,cross-collateralization,etc)or are they considering any financing in connection with the subject of the application or any business operating or to be operated on the property? ■Yes ❑No • If yes,identify the financial institutions. Tidewater Mortgage 2. Does the applicant have a real estate broker/agent/realtor for current and anticipated future sales of the subject property? ❑Yes ■No • If yes,identify the real estate broker/realtor. 3. Does the applicant have services for accounting and/or preparation of tax returns provided in connection with the subject of the application or any business operating or to be operated on the property?III Yes ❑No • If yes,identify the firm or individual providing the service. Mathews and Saunders 4. Does the applicant have services from an architect/landscape architect/land planner provided in connection with the subject of the application or any business operating or to be operated on the property?❑Yes Ili No • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?❑Yes U No • If yes,identify the purchaser and purchaser's service providers. 2lPage William J. Wright,Jr. Agenda Item 26 Page 11 Disclosure Statement Disclosure Statement Iiii Planning&Community Development '.4*.fr..4tv 6. Does the applicant have a construction contractor in connection with the subject of the application or any business operating or to be operated on the property?❑Yes It No • If yes,identify the construction contractor. 7. Does the applicant have an engineer/surveyor/agent in connection with the subject of the application or any business operating or to be operated on the property?❑Yes I No • If yes,identify the engineer/surveyor/agent. 8. Is the applicant receiving legal services in connection with the subject of the application or any business operating or to be operated on the property?0 Yes le No • If yes,identify the name of the attorney or firm providing legal services. Applicant Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing,I am responsible for updating the information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board or ny public bqd r committee i connection with this application. V C pit nt Signature i I LL, A t\ S , Q J--, k-\rt Print Name and Title i0 . K77027v - — Date Is the applicant also the owner of the subject property? 0 Yes 0 No • If yes,you do not need to fill out the owner disclosure statement. FOR CITY USE ONLY/All disclosures must be updated two(2)weeks prior to any Planning Commission and City Council meeting that pertains to the applications IN No changes as of Nil 02/09/2021 SIRnatw e Print Name I J.N A ADB UA As per the applicant,there are no anticipated changes before the March 2, 2021 City Council Public Hearing Date:02/03/2021 Wage William J. Wright,Jr. Agenda Item 26 Page 12 Disclosure Statement Disclosure Statement \43 . Planning&Community Development Owner Disclosure Owner Name William J.Wright,Jr. Applicant Name William J.Wright,Jr. Is the Owner a corporation,partnership,firm,business,trust or an unincorporated business?0 Yes U No • If yes,list the names of all officers,directors,members,trustees,etc.below. (Attach a list if necessary) • If yes,list the businesses that have a parent-subsidiary3 or affiliated business entity4 relationship with the Owner. (Attach a list if necessary) Known Interest by Public Official or Employee Does an official or employee of the City of Virginia Beach have an interest in the subject land or any proposed development contingent on the subject public action?0 Yes No • If yes,what is the name of the official or employee and what is the nature of the interest? "Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. °"Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(iii)there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a close working relationship between the entities." See State and Local Government Conflict of Interests Act,Va. Code§2.2-3101. SIPage William J. Wright,Jr. Agenda Item 26 Page 13 Disclosure Statement Disclosure StatementNid Planning&Community Development Owner Services Disclosure 1. Does the Owner have any existing financing(mortgage,deeds of trust,cross-collateralixation,etc)or are they considering any financing in connection with the subject of the application or any business operating or to be operated on the property? ■Yes ❑No • If yes,identify the financial institutions. dewater Mortgage 2. Does the Owner have a real estate broker/agent/realtor for current and anticipated future sales of the subject property? ❑Yes No • If yes,identify the real estate broker/realtor 3. Does the Owner have services for accounting and/or preparation of tax returns provided in connection with the subject of the application or any business operating or to be operated on the property?I Yes 0 No • If yes,identify the firm or individual providing the service. Mathews and Saunders 4. Does the Owner have services from an architect/landscape architect/land planner provided in connection with the subject of the application or any business operating or to be operated on the property?0 Yes O No • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?0 Yes II No • If yes,identify the purchaser and purchaser's service providers. 6. Does the Owner have a construction contractor Ir connection with the subject of the application or any business operating or to be operated on the property?❑Yes III No • If yes,identify the construction contractor. 7. Does the Owner have an engineer/surveyor/agent in connection with the subject of the application or any business operating or to be operated on the property?❑Yes I No • If yes,identify the engineer/surveyor/agent Wage William J. Wright,Jr. Agenda Item 26 Page 14 Disclosure Statement Disclosure Statement NB ,' of Planning&Community , . Development 8. Is the Owner receiving legal services in connection with the subject of the application or any business operating or to be operated on the property?0 Yes in No • If yes,identify the name of the attorney or firm providing legal services. Owner Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that. upon receipt of notification that the application has been scheduled for public hearing,I am responsible for updating the information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board ct\ onany public body or mit' e in connection with this application. Owner\\1,,\.\\x store Wit '—L-/nM J. VI(2(C., In si c Print Name Title tuI6JZU2o Date 7 I P a i, William J. Wright,Jr. Agenda Item 26 Page 15 Next Steps • Upon receiving a recommendation from Planning Commission,this request will be scheduled for a City Council public hearing. Staff will inform the applicant and/or their representative of the date of the hearing in the upcoming days. • Following City Council's decision,the applicant will receive a decision letter from Staff. • Once the conditions of approval are in place and/or completed,the applicant must contact the Zoning Division of the Planning Department to obtain verification that the conditions have been met. Contact the Zoning Division at 757-385-8074. • If the request requires land disturbance and/or a subdivision of property, please contact the Development Services Center(DSC)to discuss next steps for site plan/plat review. Contact the DSC at 757-385-4621 or the Development Liaison Team at 757-385-8610. • Please note that further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/ Permits and Inspections Division,and the issuance of a Certificate of Occupancy,are required before any approvals allowed by this application are valid. • The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED)concepts and strategies as they pertain to this site. William J.Wright,Jr. Agenda Item 26 Page 16 STR VICI : ITY SLAP WILLIAM J. WRIGHT JR. - 911 PACIFIC AVENUE, UNIT B .,giti L— ,,,, ,_,__ -T.:. '`,,,tA '.\\V \ 0ALA____\ ------ -, ''.;---\--A.. ...:::: - r 4111r0i J. �1 �, \ Ilaic -..;cv--1-- 1/*/*/..._. y \\ I ii 11L-\'':.-/-4 0- ' 'ff":7 . tc\ \ rP ram— --r Ala a 4 el . lit \ \ P' .., BeCl.it lhl► woo°.', ' \ \IC- \ !*$ 4b°j‘t,wii0ASItir Wok'', --, 7 STATUS ` • Approved am'." lwriii . � ._ • Denied , _ � lQ Under Review ` 1 � y �:e;�� '� s {� Registered iii �.+' �� i'72?'' 11�1 Items # 26 William Joseph Wright, Jr. [Applicant & Property Owner] Conditional Use Permit(Short Term Rental) 911 Pacific Avenue, Unit B January 13, 2021 RECOMMENDED FOR APPROVAL - CONSENT Mr. Weiner: Thank you. Our next order of business is the Consent Agenda, which the Vice Chair will take over. Mr. Wall: Okay, thank you Mr. Chair. These are applications that are recommended for approval by Staff and the Planning Commission concurred, and there are no speakers signed up in opposition. The Planning Commission places the following applications on the Consent Agenda. Application number 1, 4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20 with an amended condition or with an added condition concerning forested buffer. The Planning Commission also places the following applications for Conditional Use Permit for Short- Term Rental on the Consent Agenda as they meet the applicable requirements for Section 241.2 of the Zoning Ordinance. Staff and the Planning Commission supports the applications, and there are no speakers signed up to comment. These include agenda items number 21, 23, 25, 26, and 27. Mr. Weiner: Thank you Commissioner Wall. Can I get a motion to approve the items on consent, please. Mr. Wall: I make a motion that these items be approved by consent. Ms. Klein: Second. 1 Mr. Weiner: Okay. I got a approval by Commissioner Wall and a second by Ms. Klein, ready for vote. Ms. Coleman: If you are in favour of the motion say, yes. And, if you are opposed say, no. Ms. Coleman: Mr. Alcaraz. Mr. Alcaraz: Yes. Ms. Coleman: Mr. Barnes is absent. Mr. Coston. Mr. Coston: Yes. Ms. Coleman: Mr. Graham. Mr. Graham: Yes. Ms. Coleman: Mr. Horsley. Mr. Horsley: Yes. Ms. Coleman: Mr. Inman. Mr. Inman: Yes. Ms. Coleman: Ms. Klein. Ms. Klein: Yes. Ms. Coleman: Mr. Redmond. Mr. Redmond: Yes. Ms. Coleman: Ms. Oliver. Ms. Oliver: Yes. Ms. Coleman: Vice Chair Wall. Mr. Wall: Yes. Ms. Coleman: And, Chairman Weiner. Mr. Weiner: Yes. 2 Ms. Coleman: By record vote of 10 for and zero against, agenda items 1,4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20, with the added condition for the 20- foot buffer, and 21, 23, 25, 26, and 27 have been approved on the Consent Agenda. AYE 10 NAY 0 ABS 0 ABSENT 1 Alcaraz AYE Barnes ABSENT Coston AYE Graham AYE Horsley AYE Inman AYE Klein AYE Oliver AYE Redmond AYE Wall AYE Weiner AYE CONDITIONS: 1. The following conditions shall only apply to the dwelling unit addressed as 911 Pacific Avenue, Unit B, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. Proof of ability to use at least one off-street parking space at a location acceptable to the Zoning Administrator shall be provided to the Planning Department on an annual basis as long as the Conditional Use Permit is active. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of 3 bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty (30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10. Accessory structures shall not be used or occupied as Short Term Rental. 11. No signage shall be on site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 4 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards. All applicable permits required by the City Code, including those administered by the Department of Planning I Development Services Center and Department of Planning / Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED) concepts and strategies as they pertain to this site. 5 January 6,2021 Dear City of Virginia Beach Planning Commission: I am responding to the request(attached)for the Conditional Use Permit. I am directly above this unit in 911C, so I will be affected by this decision. I am not opposed to this request, but feel it should be carried out in the best interests of all home owners in this HOA who have vested interests.All short-term renters should be provided a set of the, "900 Pacific Place Condominium Association Rules and Regulations" and these rules need to be agreed upon by both parties.The applicant should also confirm that our association's insurance coverage provides for these tenants adequately.Too many police reports have been filed at this property...usually involving tenants.These are on file.The applicant should be responsible for gathering proper identification on these short-term renters and have it available if requested...this includes the license, make and model of their vehicle.This summer one vehicle was stolen and damage to a parked car was witnessed in the parking lot. Please take this seriously. My husband and I (owners)were at our unit for one week this summer. During that week there was one stolen vehicle (caught on security camera),one parking lot incident witnessed (mentioned above),the police came 2 times for other incidents as witnessed by my husband and myself,and homeless people nightly slept in our utility alcove. Previously, there has been an incident with a party being held at gunpoint which was covered by the local television station.One unit was set on fire from a smoking tenant...which affected other units and caused an insurance claim. I would prefer that cigarette smoking not be encouraged,and this unit be rented as a non-smoking unit. If the short-term renter smokes,it should be done using the outside exterior receptacles that are provided by the HOA...which comes from our HOA dues. Your attention to these concerns is appreciated. Sincerely, Janet&Thomas Bowman 911C Pacific Place R 15 1Alri&i....„: Sal ems, AG2 /2 aAr /0, , _lk ... ,,,,,,\ ® o __ o R 15 11.Nt -.0) ' a ...4111 , R_115 3 - AG2 c:i , Z d to o R ❑ a _ LJ �i w jar- ©L art "ty _______ -------------1„_ i‘U :he!) __,/ p oft AG N /i site D & D Creations, LLC W A& t Property_Polygons 2621 Highland Meadows Way �J s ® Zoning Building E =win imil Feet PLAN TRANS SURFACES 0 25 50 100 150 200 250 300 r SQy�N � (Z Sj f-, CITY OF VIRGINIA BEACH AGENDA ITEM ITEM: D AND D CREATIONS, LLC [Applicant] DANIEL AND KELLIE JO DAVID REVOCABLE TRUST [Property Owners] Conditional Use Permit(Short Term Rental) for the property located at 2621 Highland Meadows Way (GPIN 1484138836). COUNCIL DISTRICT — PRINCESS ANNE MEETING DATE: March 2, 2021 • Background: The applicant is requesting a Conditional Use Permit for Short Term Rental on a 15,094 square-foot parcel zoned R-15 Residential District. The lot consists of one single-family dwelling built in 2003 and contains four bedrooms. The minimum number of parking spaces required for the Short Term Rental is one per bedroom, or four spaces in this instance. The maximum occupancy for guests on-site after 11 :00 p.m. for a four-bedroom Short Term Rental is 12; however, at the time of this writing, the applicant accepts City Council's recent Short Term Rental condition revisions reducing the number of overnight guests permitted to two per bedroom and limiting the number of bookings in a seven day period from two to one. These changes are reflected in the conditions below. • Considerations: This site is located within the Highland Meadows subdivision, which consists of 24 developed single-family residential building lots situated in an extended cul-de-sac layout. Because this home contains four bedrooms, four off-street parking spaces are required. The applicant's parking plan depicts all four spaces within an existing driveway. Because two of the four spaces slightly encroach into the city right of way, but remain within the driveway apron, the plan was reviewed by the Zoning Administrator. As permitted by Section 241 .2(1) of the City Zoning Ordinance, the Zoning Administrator deemed this plan as acceptable. In addition, all other requirements of Section 241.2 of the Zoning Ordinance pertaining to Short Term Rentals can reasonably be met by the applicant. Further details pertaining to the application are provided in the attached Staff Report. One letter of opposition and eight letters of support were received relating to this request. The letter of opposition is from the homeowner of an abutting property. The content of the letter focuses on concerns relating to excess parking needs, increased noise, and a general opposition to the proposed use. D and D Creations, LLC Page 2 of 4 • Recommendation: On January 13, 2021, the Planning Commission passed a motion to recommend this item on the Consent Agenda, passing a motion by a recorded vote of 10-0, to recommend approval of this request. 1 . The following conditions shall only apply to the dwelling unit addressed as 2621 Highland Meadows Way, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through `c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. D and D Creations, LLC Page 3of4 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10.Accessory structures shall not be used or occupied as Short Term Rentals. 11 .No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12.The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13.The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14.There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15.The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16.To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. • Attachments: Staff Report and Disclosure Statements Location Map STR Vicinity Map Minutes of Planning Commission Hearing Letter of Opposition (1) Letters of Support (8) D and D Creations, LLC Page 4 of 4 Recommended Action: Staff recommends Approval. Planning Commission recommends Approval. Submitting Department/Agency: Planning Department City Manager: r) I Applicant D and D Creations, LLC.Property Owner Daniel & Kellie Jo David Revocable Trust Agenda Item gill Planning Commission Public Hearing January 13, 2021 City of City Council Election District: Princess Anne 27 Virginia Beach Request Conditional Use Permit(Short Term Rental) Staff Recommendation %-- \--. I:1 ---7 Approval Staff Planner Antionette Fowlkes Location 2621 Highland Meadows Way GPIN - f 14841388360000 Site Size .._.>5 � ` 15,094 square feet '40:6„ , p Nv' / T '. Existing Land Use and Zoning District Single-family dwelling/R-15 Residential Surrounding Land Uses and Zoning Districts North Salem Road i Single-family dwellings/R-15 Residential South Highland Drive -. 4 Single-family dwellings/R-15 Residential S 1 East Salem Road - Single-family dwellings/R-15 Residential West ' , Highland Drive17i OF -, 061,4 Single-family dwellings/R-15 Residential D and D Creations, LLC. Agenda Item 27 Page 1 Background & Summary of Proposal Site Conditions and History • The approximately 15,094 square foot property is zoned R-15 Residential District. • City records indicate that the single-family dwelling was constructed in 2003. • Staff inspected the site on November 9, 2020 to observe site conditions and take photographs for this report. • On-street parking is permitted 24-hours per day;therefore, any overflow parking beyond the minimum parking spaces required could occur within the public street. • The applicant accepts City Council's recently imposed conditions reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Short Term Rentals in the Vicinity gr r i 411( --/Z .• 1rowo �. �11 s,p,7us �` e Amp Approved ®' • Denied ,,` ' Q Under Review O Registered ' T r i Map current as of 01.27.2021 Summary of Proposal The applicant submitted a Conditional Use Permit request to operate a Short Term Rental on the subject site.The regulations for Short Term Rental use are identified in Section 241.2 of the City Zoning Ordinance.Specific details pertaining to this application are listed below. • Number of bedrooms in the Short Term Rental:4 • Maximum number of guests permitted on the property after 11:00 pm: 8-As recommended in condition#15 • Number of parking spaces required (1 space per bedroom required):4 D and D Creations, LLC. Agenda Item 27 Page 2 • Number of parking spaces provided on-site:4 AG-2 4r� 0zi 0 No Zoning History to Report R-15 `�� AG-2 b 'aQ 7 ci ' c AG- Application Types CUP—Conditional Use Permit MOD—Modification of Conditions or Proffers FVR—Floodplain Variance LUP—Land Use Plan REZ—Rezoning NON—Nonconforming Use ALT—Alternative Compliance STR—Short Term Rental CRZ—Conditional Rezoning STC—Street Closure SVR—Subdivision Variance Evaluation & Recommendation The applicant is requesting to operate a four-bedroom Short Term Rental.The property is located in the Princess Anne District, along Highland Meadows Way,where short term rentals are not a typical use. Four off-street parking spaces are required for the proposed four-bedroom Short Term Rental.The applicant is planning to meet this requirement by parking four vehicles in the driveway as shown on page six of this report.While two of the four spaces slightly encroach into the right-of-way,the flow of pedestrian or vehicular movements will not be impacted. Based on this,the Zoning Administrator reviewed the parking plan and deemed it acceptable. All other requirements of Section 241.2 of the Zoning Ordinance pertaining to Short Term Rentals can be reasonably met by the applicant.There is no known opposition to this request,and Staff has received eight letters of support from surrounding property owners. Based on the considerations above,Staff recommends approval of this request with the conditions listed below, including City Council's revisions, reducing the number of bookings in a seven day period to one and limiting the overnight guest calculation to two per bedroom. Recommended Conditions 1. The following conditions shall only apply to the dwelling unit addressed as 2621 Highland Meadows Way,and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241.2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5)years from the date of approval.The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however,the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short D and D Creations, LLC. Agenda Item 27 Page 3 Term Rental where the Short Term Rental has been the subject of neighborhood complaints,violations of its conditions or violations of any building, housing,zoning,fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight(number of bedrooms times two (2))on the property where the Short Term Rental is located.This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 5. The owner or operator must provide the name and telephone number of a responsible person,who may be the owner,operator or an agent of the owner or operator,who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty(30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when,the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a'through 'c' below.This information must be submitted to the Planning Department for review and approval.This shall be done within six(6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration;and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law,each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23-71 (noise),31-26,31-27 and 31-28 (solid waste collection), 12-5(fires on the beach), 12-43.2 (fireworks),and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles,where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31-28. 10. Accessory structures shall not be used or occupied as Short Term Rentals. 11. No signage shall be on-site,except one(1),four(4)square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7)day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 15. The maximum number of persons on the property after 11:00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors(which may be wireless),a fire extinguisher and,where natural gas or propane is present, carbon monoxide detectors,shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards.Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of D and D Creations, LLC. Agenda Item 27 Page 4 Planning/Development Services Center and Department of Planning/Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED)concepts and strategies as they pertain to this site. Public Outreach Information Planning Commission • The applicant reported that they met with the surrounding property owners,and no objections were raised. Eight letters of support have been received by Staff. • As required by the Zoning Ordinance,the public notice sign(s)was placed on the property on December 14, 2020. • As required by State Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, December 27, 2020,and January 3, 2021. • As required by City Code,the adjacent property owners were notified regarding the request and the date of the Planning Commission public hearing on December 28, 2020. • This Staff report, as well as all reports for this Planning Commission's meeting,was posted on the Commission's webpage of www.vbgov.com/pc on January 7, 2021. City Council • One letter of opposition and eight letters of support were received relating to this request. • As required by City Code,this item was advertised in the Virginian-Pilot Beacon on Sundays, February 14,2021 and February 21, 2021. • As required by City Code,the adjacent property owners were notified regarding both the request and the date of the City Council's public hearing on February 15,2021 • The City Clerk's Office posted the materials associated with the application on the City Council website of https://www.vbgov.com/government/departments/city-clerk/city-council/Documents/BookmarkedAgenda.pdf on February 26, 2021. D and D Creations, LLC. Agenda Item 27 Page 5 Site Layout & Parking Plan 7 PIN (F) N 12'54'50" E 100.00' `° PIN (F) 0.6'...-"12.2' 5' PRIVATE DRAINAGE EASEMENT 0.51 0.51/ /1--- X — — C 12.25' mai— x _ I 6' WOOD FENCE K smED NO FOUNOA110N x 1 II 23 K 4I N k ! I E......,__ x '7.0' ••1 6.9' 1; 1/9 3 I oN 4 2 STORY I a FRAME HOUSE 2621 ( r N f Z ! V. in Mr el 21 I r • I I • .. 36.5' I T.V. L. POWER g # p .V:®0 (E) PED ..-TRANS. I 4ED _ PIN (F) = PIN (F) _ ii • .• �150.00 66s 10 S 12'54'50" W 54.59' • . . . • R q5, M R0�4 10' SPA HIGHLAND MEADO WAY 50' D and D Creations, LLC. Agenda Item 27 Page 6 Site Photos ' 'y`N,y� NSF4 - -9 Y,-• •'•A a .� iri i � ,,,,,A� - .e i +r a vi, O, [[� rn r r f I Ell F YYi- �. . - —ve �- . V r D and D Creations, LLC. Agenda Item 27 Page 7 Disclosure Statement Disclosure StatementNA3 Planning&Conuminity Development The disclosures contained in this form are necessary to inform public officials who may vote on the application as to whether they have a conflict of interest under Virginia law. The completion and submission of this form is required for all applications that pertain to City real estate matters or to the development and/or use of property in the City of Virginia Beach requiring action by the City Council or a City board,commission or other body. Applicant Disclosure Applicant Name D and D Creations , �-�- `-- Does the applicant have a representative? ■Yes ❑No • If yes,lot the name of the representative. Keilie Jo David is the applicant a corporation,partnership,firm,business,trust or an unincorporated business a �'No• If yes,list the names of all officers,directors,members,trustees,etc.below. jAttach a list if necessary) Qa tit DnxjdottrAvA itllit cJt Oci)14,.AtrKbstS • If yes,list the businesses that have a parent-subsidiary'or affiliated business entity'relationship with the applicant. (Attach a list if necessary) Rant "Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation.` See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. '"Affiliated business entity relationship"means"a relationship,other than parent-subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other business entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(iii)there is shared management or control between the business entities. Factors that should be considered in determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entities share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there is otherwise a close working relationship between the entities."See State and Local Government Conflict of Interests Act,Va. Code§2.2.3101. 1)Page D and D Creations, LLC. Agenda Item 27 Page 8 Disclosure Statement Disclosure Statement 1A3 City of Virginia Beach Planning&Community Development Known Interest by Public Official or Employee Does an official or employee of the City of Virginia Beach have an interest in the subject land or any proposed development contingent on the subject public action?IF Yes 0 No • If yes,what is the name of the official or employee and what is the nature of the interest? Daniel David Building Maintanence department Applicant Services Disclosure 1. Does the applicant have any existing financing(mortgage,deeds of trust,cross-collateralization,etc)or are they considering any financing in connection with the subject of the application or any business operating or to be operated on the property? E Yes ❑ No • If yes,identify the financial institutions. Cross Country Mortgage 2. Does the applicant have a real estate broker/agent/realtor for current and anticipated future sales of the subject property? ❑Yes ® No • If yes,identify the real estate broker/realtor. 3. Does the applicant have services for accounting and/or preparation of tax returns provided in connection with the subject of the application or any business operating or to be operated on the property?it Yes 0 No • If yes,identify the firm or individual providing the service. Jackson Hewitt Taxes Melinda Wittenholf 4. Does the applicant have services from an architect/landscape architect/land planner provided in connection with the subject of the application or any business operating or to be operated on the property?❑Yes ® No • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?0 Yes llllt No • ff yes,identify the purchaser and purchaser's service providers. 21 D and D Creations, LLC. Agenda Item 27 Page 9 Disclosure Statement Disclosure Statement 1A3 City of tiryirar,ikre Planning&Community Development 6. Does the applicant have a construction contractor in connection with the subject of the application or any business operating or to be operated on the property?❑Yes III No • If yes,identify the construction contractor. 7. Does the applicant have an engineer/surveyor/agent in connection with the subject of the application or any business operating or to be operated on the property?0 Yes I No • If yes,identify the engineer/surveyor/agent. 8. Is the applicant receiving legal services in connection with the subject of the application or any business operating or to be operated on the property?❑Yes II No • If yes,identify the name of the attorney or firm providing legal services. Applicant Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing,1 am responsible for updating the information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board or any public body or committee in connection with this application. Applicant Signature - 11-Heila Gi ��3U�(.. I`.'/�//t L// Print Name and Title Daniel and Kellie Jo David Owners Date Is the applicant also the owner of the subject property? I Yes ❑No • If yes,you do not need to fill out the owner disclosure statement. FOR CITY USE ONLY/All disclosures must be updated two(2)weeks prior to any Planning Commission and City Council meeting that pertains to the applications p No changes•sof Date 02-01-2021 s'`""h" Wai ami.,Mfiller Print Name William Miller As per the applicant,there are no anticipated changes before the March 2, 2021 CC public hearing. Date:02-01-2020 3 D and D Creations, LLC. Agenda Item 27 Page 10 Disclosure Statement Disclosure Statement Planning&Community Development Owner Disclosure Owner Name �- r '1_i,� y cr i f F-Q�IIt . I14 c R ucy' it�ha �YkSr Applicant Name D and D Creations, LLC Is the Owner a corporation,partnership,firm,business,trust or an unincorporated business?I2 Yes NO • It yes,list the names of all officers,directors,members,trustees,etc.below. (Attach a list if necessary) 1.Y Ylit� ( ;,IL,. (jr,.� �itie x G, ok)(& Alto 1),eV5 • If yes,list the businesses that have a parent-subsidiary'or affiliated business entity"relationship with the Owner. (Attach a list if necessary) • Known Interest by Public Offlclal or Employer' Does an official or employee of the City of Virginia Beach have an interest in the subject land or any proposed development contingent on the subject public action?14'Yes No ▪ If yes,whattI Is the name of the officials or employee and what Is the nature of the interest? ,)g �+nie l 1 V1 - Ci o-i" V q t` v a L,1 mi)lore i i11 1---)►�4.u'giM 1Nykkx "Parent-subsidiary relationship"means"a relationship that exists when one corporation directly or indirectly owns shares possessing more than 50 percent of the voting power of another corporation." See State and Local Government Conflict of Interests Act,VA.Code§2.2-3101. `•Affiliated business entity relationship"means"a relationship,other than parent•subsidiary relationship,that exists when(i)one business entity has a controlling ownership interest in the other buainass entity,(ii)a controlling owner in one entity is also a controlling owner in the other entity,or(iii)there is shared management or control between the business entities. Factors that should be considered In determining the existence of an affiliated business entity relationship include that the same person or substantially the same person own or manage the two entities;there are common or commingled funds or assets;the business entitles share the use of the same offices or employees or otherwise share activities,resources or personnel on a regular basis;or there Is otherwise a close working relationship between the entities." Sec State and Local Government Conflict of interests Act,Va. Code§2.2 3101. 5 l P a D and D Creations, LLC. Agenda Item 27 Page 11 Disclosure Statement Disclosure Statement VB City ;Imam Planning&Comm 'o Development`- Owner Services Disclosure 1. Does the Owner have any existing financing(mortgage,deeds of trust,cross-collaterallzatlon,etc)or are they considering any financing in connection with the subject of the application or any business operating or to be operated on the property? Yes ❑No • If yes,identify the financial institutions. Cross Country Mortgage 2. Does the Owner have a real estate broker/agent/realtor for current and anticipated future sales of the subject property? ❑Yes No • If yes,identify the real estate broker/realtor. 3. Does the Owner have services for accounting and/or preparation of tax returns provided in connection with the subject of the application or any business operating or to be operated on the property?❑Yes III No • If yes,identify the firm or individual providing the service. 4. Does the Owner have services from an architect/landscape architect/land planner provided in connection with the subject of the application or any business operating or to be operated on the property?0 Yes ® No • If yes,identify the firm or individual providing the service. 5. Is there any other pending or proposed purchaser of the subject property?0 Yes III No • If yes,identify the purchaser and purchaser's service providers. 6. Does the Owner have a construction contractor in connection with the subject of the application or any business operating or to be operated on the property?❑Yes No • If yes,identify the construction contractor. 7. Does the Owner have an engineer/surveyor/agent in connection with the subject of the application or any business operating or to be operated on the property?0 Yes it No • If yes,identify the engineer/surveyor/agent. 6I D and D Creations, LLC. Agenda Item 27 Page 12 Disclosure Statement Disclosure Statement cuy fYugnwBox* Planning&Community Development 8. Is the Owner receiving legal services in connection with the subject of the application or any business operating or to be operated on the property?❑Yes ® No • If yes,identify the name of the attorney or firm providing legal services. Owner Signature I certify that all of the information contained in this Disclosure Statement Form is complete,true,and accurate. I understand that, upon receipt of notification that the application has been scheduled for public hearing,I am responsible for updating the Information provided herein two weeks prior to the meeting of Planning Commission,City Council,VBDA,CBPA,Wetlands Board or any public body or committee in connection with this application. ,d11:)LOIL14 Owner Signature Print Name and Title Daniel and Kellie Jo David Date to I et l 2024) 7I D and D Creations, LLC. Agenda Item 27 Page 13 Next Steps • Upon receiving a recommendation from Planning Commission,this request will be scheduled for a City Council public hearing. Staff will inform the applicant and/or their representative of the date of the hearing in the upcoming days. • Following City Council's decision,the applicant will receive a decision letter from Staff. • Once the conditions of approval are in place and/or completed,the applicant must contact the Zoning Division of the Planning Department to obtain verification that the conditions have been met. Contact the Zoning Division at 757-385-8074. • If the request requires land disturbance and/or a subdivision of property, please contact the Development Services Center(DSC)to discuss next steps for site plan/plat review. Contact the DSC at 757-385-4621 or the Development Liaison Team at 757-385-8610. • Please note that further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards.All applicable permits required by the City Code, including those administered by the Department of Planning/Development Services Center and Department of Planning/ Permits and Inspections Division,and the issuance of a Certificate of Occupancy,are required before any approvals allowed by this application are valid. • The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED) concepts and strategies as they pertain to this site. D and D Creations, LLC. Agenda Item 27 Page 14 STR VICINITY MAP D AND D CREATIONS, LLC - 2621 HIGHLAND MEADOWS WAY ,, 7' V\ / ....00°, 16`V VI rip+ o 4to--- vo. ./... _ .444..., , i.:11 ,,74-VAH,10 / N... ,. . tii'.:' 9Zi WO ' = .. ,N. 410 - - f f Ilit .\\ ,,g $ : s' 1 ,z,t Nis Y 1 le zi r. .- !.imirftm, -- „ .\„ STATUS plitoZ Aiii Approvede , ,, • Denied S ,I .., 0 Under Review .0441,11\ 0 Registered ' Items # 27 D&D Creations, LLC [Applicant] and Daniel David and Kellie David Revocable Trust [Property Owner] Conditional Use Permit (Short Term Rental) 2621 Highland Meadows Way January 13, 2021 RECOMMENDED FOR APPROVAL - CONSENT RECOMMENDED FOR APPROVAL - CONSENT Mr. Weiner: Thank you. Our next order of business is the Consent Agenda, which the Vice Chair will take over. Mr. Wall: Okay, thank you Mr. Chair. These are applications that are recommended for approval by Staff and the Planning Commission concurred, and there are no speakers signed up in opposition. The Planning Commission places the following applications on the Consent Agenda. Application number 1, 4, 5, 7, 9, 10, 11 , 12, 14, 15, 16, 19, and 20 with an amended condition or with an added condition concerning forested buffer. The Planning Commission also places the following applications for Conditional Use Permit for Short- Term Rental on the Consent Agenda as they meet the applicable requirements for Section 241 .2 of the Zoning Ordinance. Staff and the Planning Commission supports the applications, and there are no speakers signed up to comment. These include agenda items number 21 , 23, 25, 26, and 27. Mr. Weiner: Thank you Commissioner Wall. Can I get a motion to approve the items on consent, please. Mr. Wall: I make a motion that these items be approved by consent. Ms. Klein: Second. 1 Mr. Weiner: Okay. I got a approval by Commissioner Wall and a second by Ms. Klein, ready for vote. Ms. Coleman: If you are in favor of the motion say, yes. And, if you are opposed say, no. Ms. Coleman: Mr. Alcaraz. Mr. Alcaraz: Yes. Ms. Coleman: Mr. Barnes is absent. Mr. Coston. Mr. Coston: Yes. Ms. Coleman: Mr. Graham. Mr. Graham: Yes. Ms. Coleman: Mr. Horsley. Mr. Horsley: Yes. Ms. Coleman: Mr. Inman. Mr. Inman: Yes. Ms. Coleman: Ms. Klein. Ms. Klein: Yes. Ms. Coleman: Mr. Redmond. Mr. Redmond: Yes. Ms. Coleman: Ms. Oliver. Ms. Oliver: Yes. Ms. Coleman: Vice Chair Wall. Mr. Wall: Yes. Ms. Coleman: And, Chairman Weiner. Mr. Weiner: Yes. 2 Ms. Coleman: By record vote of 10 for and zero against, agenda items 1,4, 5, 7, 9, 10, 11, 12, 14, 15, 16, 19, and 20 with the added condition for the 20- foot buffer. 21, 23, 25, 26, and 27 have been approved on the Consent Agenda. AYE 10 NAY 0 ABS 0 ABSENT 1 Alcaraz AYE Barnes ABSENT Coston AYE Graham AYE Horsley AYE Inman AYE Klein AYE Oliver AYE Redmond AYE Wall AYE Weiner AYE CONDITIONS: 1. The following conditions shall only apply to the dwelling unit addressed as 2621 Highland Meadows Way, and the Short Term Rental use shall only occur in the principal structure. 2. Off-street parking shall be provided as required by Section 241 .2 of the City Zoning Ordinance or as approved by City Council. 3. This Conditional Use Permit shall expire five (5) years from the date of approval. The renewal process of this Conditional Use Permit may be administrative and performed by the Planning Department; however, the Planning Department shall notify the City Council in writing prior to the renewal of any Conditional Use Permit for a Short Term Rental where the Short Term Rental has been the subject of neighborhood complaints, violations of its conditions or violations of any building, housing, zoning, fire or other similar codes. 4. No events associated with the Short Term Rental shall be permitted with more than the allowed number of people who may stay overnight (number of bedrooms times two (2)) on the property where the Short Term Rental is located. This Short Term Rental may not request or obtain a Special Event Permit under City Code Section 4-1 (8a). 3 5. The owner or operator must provide the name and telephone number of a responsible person, who may be the owner, operator or an agent of the owner or operator, who is available to be contacted and to address conditions occurring at the Short Term Rental within thirty (30) minutes. Physical response to the site of the Short Term Rental is not required. 6. If, or when, the ownership of the property changes, it is the seller's responsibility to notify the new property owner of requirements 'a' through 'c' below. This information must be submitted to the Planning Department for review and approval. This shall be done within six (6) months of the property real estate transaction closing date. a) A completed Department of Planning and Community Development Short Term Rental Zoning registration form; and b) Copies of the Commissioner of Revenue's Office receipt of registration; and c) Proof of liability insurance applicable to the rental activity of at least one million dollars. 7. To the extent permitted by state law, each Short Term Rental must maintain registration with the Commissioner of Revenue's Office and pay all applicable taxes. 8. There shall be posted in a conspicuous place within the dwelling a summary provided by the Zoning Administrator of City Code Sections 23-69 through 23- 71 (noise), 31-26, 31-27 and 31-28 (solid waste collection), 12-5 (fires on the beach), 12-43.2 (fireworks), and a copy of any approved parking plan. 9. All refuse shall be placed in automated refuse receptacles, where provided, and comply with the requirements of City Code sections 31-26, 31-27 and 31- 28. 10. Accessory structures shall not be used or occupied as Short Term Rentals. 11. No signage shall be on-site, except one (1), four (4) square foot sign, may be posted on the building which identifies the Short Term Rental. 12. The Short Term Rental shall have no more than one (1) rental contract during any consecutive seven (7) day period. 13. The owner or operator shall provide proof of liability insurance applicable to the rental activity at registration and renewal of at least one million dollars ($1,000,000) underwritten by insurers acceptable to the City. 14. There shall be no outdoor amplified sound after 10:00 p.m. or before 10:00 a.m. 4 15. The maximum number of persons on the property after 11 :00 p.m. and before 7:00 a.m. ("Overnight Lodgers") shall be two (2) individuals per bedroom. 16. To the extent permissible under state law, interconnected smoke detectors (which may be wireless), a fire extinguisher and, where natural gas or propane is present, carbon monoxide detectors, shall be installed in each Short Term Rental. Further conditions may be required during the administration of applicable City Ordinances and Standards. Any site plan submitted with this application may require revision during detailed site plan review to meet all applicable City Codes and Standards. All applicable permits required by the City Code, including those administered by the Department of Planning / Development Services Center and Department of Planning / Permits and Inspections Division, and the issuance of a Certificate of Occupancy, are required before any approvals allowed by this application are valid. The applicant is encouraged to contact and work with the Crime Prevention Office within the Police Department for crime prevention techniques and Crime Prevention Through Environmental Design (CPTED) concepts and strategies as they pertain to this site. 5 2625 Highland Meadows Way Virginia Beach, VA. 23456 January 8, 2021 City of Virginia Beach Planning Commission 2875 Sabre Street, Suite 500 Virginia Beach, VA. 23452 RE: Agenda Item 27, Conditional Use Permit (Short-Term Rental), D&D Creations, LLC (Applicant) Address 2621 Highland Meadows Way Dear City of Virginia Beach Planning Commission: As a next-door neighbor and property owner to the "applicant" requesting your approval of a 4-bedroom short term rental, I am opposed to the use of this property as a short term rental. I purchased and built my single-family home, almost 18 years ago, because of the quiet, secluded nature of this small, 24-home family neighborhood. My home is the nearest residential structure to the proposed rental and will be most impacted by the proposed use. Regarding the staff report for this proposed item, please know the following: • I was neither invited to any meeting of surrounding property owners nor did the applicant meet with me to discuss the proposed use. I received a letter placed on my door that informed me of the proposed use with a request of a 3-day turnaround of support. • November 9th, 2020, the day of the staff inspection/visit, was on a Monday. A more appropriate day to observe current use of on-street parking would be a Saturday or a Sunday (weekend). Currently on- street parking at 2621 and along the court is utilized much more. • According to the letter placed on door by the applicants, "Danny and I will either be staying in the room over the garage or 10 minutes away at my daughter's house." As neighbors, the Davids and I work to be considerate of each other's use of our properties; however, I feel strongly that approval of this application will place added burden on me to monitor events at 2621 particularly during the summer months of high pool usage. Please consider what allowing such a neighborhood to be tainted by visiting sports teams could do to the quality of this family neighborhood. The "applicant" provided a letter to neighbors in this community informing us of the following: "We would like to mostly cater to the sports teams that are in the Landstown area that are having events at the Sportsplex, soccer fields, Field House, Field Hockey and Softball fields." I purposely did not have a house built next to a "hotel" but in a secluded, quiet section of this great city. I am proud of the recreational opportunity our city offers at the Sportsplex and surrounding fields; however, I am opposed to our quiet neighborhood being used as a tourism/hospitality center for sports teams. I strongly encourage the Planning Commission and the Planning Department consider hospitality and "stay over" uses and facilities in Landstown Commons and surrounding areas much better suited for sports teams and patrons of the Virginia Beach Sportsplex, Princess Anne Athletic Complex, and surrounding entertainment area. Thank you for your consideration of my views related to this very important matter that can impact the quality of life for my family and others. Sincerely, Elsie L. Harold Lans Concerned Property Owner Dear Highland Meadows Neighbor, Danny and I live at 2621 Highland Meadows Way and have submitted our application to the City to allow for Short Term rentals. Through the years and currently, we have rented out rooms in our home, however starting in February 2021, we would like to have the option of Airbnb our entire house occasionally through the year. In order to Airbnb our entire house, we have to get permission from the City. As a neighbor, we would also like to have your condolences for our Airbnb. We would like to mostly cater to the sports teams that are in the Landstown area that are having events at the Sportsplex, soccer fields, Field House, Field Hockey and Softball fields. We have done our research and the closest hotels are off Bonnie Road or Lynnhaven Parkway. Sports teams normally just need a place to shower and lay there head down before the next competitive day. When we do start to advertise, we will specifically say that we are a family friendly neighborhood and therefore no parties, no pets and no smoking. We will only rent to 4 star rated families and Danny and I will either be staying in the room over the garage or 10 minutes away at my daughters house. We will also advise all renters that we will be spot checking the property during their stay to make sure the pool is clean and the Airbnb house rules are being followed. Please give us your blessing with the Airbnb by signing this form to acknowledge that we have advised you of our intent for short term rental in 2021. Please save my cell number 757-406-4510 Kellie Jo David in case you ever need to get in contact with us. Neighbors name: ,y 577,0 i24116\01(Povi }1v,JsfP- Address: 2(L'7 ri I tb t LA NO 'h( D a s '."J Phone mber: '7 S7 `il i /4i:7 I:. 'o Sign: Rkt V- Thank It u for your support Dear Highland Meadows Neighbor, Danny and I live at 2621 Highland Meadows Way and have submitted our application to the City to allow for Short Term rentals. Through the years and currently, we have rented out rooms in our home, however starting in February 2021, we would like to have the option of Airbnb our entire house occasionally through the year. In order to Airbnb our entire house,we have to get permission from the City. As a neighbor,we would also like to have your condolences for our Airbnb. We would like to mostly cater to the sports teams that are in the Landstown area that are having events at the Sportsplex, soccer fields, Field House, Field Hockey and Softball fields. We have done our research and the closest hotels are off Bonnie Road or Lynnhaven Parkway. Sports teams normally just need a place to shower and lay there head down before the next competitive day. When we do start to advertise, we will specifically say that we are a family friendly neighborhood and therefore no parties, no pets and no smoking. We will only rent to 4 star rated families and Danny and I will either be staying in the room over the garage or 10 minutes away at my daughters house. We will also advise all renters that we will be spot checking the property during their stay to make sure the pool is clean and the Airbnb house rules are being followed. Please give us your blessing with the Airbnb by signing this form to acknowledge that we have advised you of our intent for short term rental in 2021. Please save my cell number 757-406-4510 Kellie Jo David in case you ever need to get in contact with us. Neighbors name: .1.)r\RZA 41114E E(,(,137T Address: alo a`•S H J('H L A Nip M G A D3" W Ay Phone nu ber: (—►5,4 4i9 S - (S . Sign: , r / --- Thank ou for your support ` Dear Highland Meadows Neighbor, Danny and I live at 2621 Highland Meadows Way and have submitted our application to the City to allow for Short Term rentals. Through the years, we have rented out rooms in our home, however starting in February 2021, we would like to have the option of Airbnb our entire house occasionally through the year. In order to Airbnb our entire house, we have to get permission from the City. As a neighbor, we would also like to have your condolences for our Airbnb. We would like to mostly cater to the sports teams that are in the Landstown area that maybe having events at the Sportsplex, soccer fields, Field House, Field Hockey and Softball fields. We have done our research and the closest hotels are off Bonnie Road or Lynnhaven Parkway. Sports teams normally just need a place to shower and lay there head down before the next competitive day. When we do start to advertise, we will specifically say that we are a family friendly neighborhood and therefore no parties, no pets and no smoking. We will only rent to 4 star rated families and Danny and I will either be staying in the room over the garage or 10 minutes away at my daughters house. We will also advise all renters that we will be spot checking the property during their stay to make sure the pool is clean and the Airbnb house rules are being followed. Please give us your blessing with the Airbnb by signing this form to acknowledge that we have advised you of our intent for short term rental in 2021. Please save our cell number 757-406-4510 in case you ever need to get in contact with us. Neighbors name: K000 tit 11 U 1 Address: ?c,12 IC44LM.►t2 h Tbo,wS t6 f7 Phone number: 75 - SSZ(—SC 't Dear Highland Meadows Neighbor, Danny and I live at 2621 Highland Meadows Way and have submitted our application to the City to allow for Short Term rentals. Through the years and currently, we have rented out rooms in our home, however starting in February 2021, we would like to have the option of Airbnb our entire house occasionally through the year. In order to Airbnb our entire house, we have to get permission from the City. As a neighbor, we would also like to have your condolences for our Airbnb. We would like to mostly cater to the sports teams that are in the Landstown area that are having events at the Sportsplex, soccer fields, Field House, Field Hockey and Softball fields. We have done our research and the closest hotels are off Bonnie Road or Lynnhaven Parkway. Sports teams normally just need a place to shower and lay there head down before the next competitive day. When we do start to advertise, we will specifically say that we are a family friendly neighborhood and therefore no parties, no pets and no smoking. We will only rent to 4 star rated families and Danny and I will either be staying in the room over the garage or 10 minutes away at my daughters house. We will also advise all renters that we will be spot checking the property during their stay to make sure the pool is clean and the Airbnb house rules are being followed. Please give us your blessing with the Airbnb by signing this form to acknowledge that we have advised you of our intent for short term rental in 2021. Please save my cell number 757-406-4510 Kellie Jo David in case you ever need to get in contact with us. Neighbors name: )e ,�,� ►c ko�� Address: 26 2_ H!�kulct.lr_l filectclow.� i&)c Phone number: 75 7 - &&S , 9/ I Sign: Thank youdiall r , 'pport L.Wdr id Scadav'i +e rr. ., 1.1-iui :ug.I !rseedr;:fpsi FAR.phlnrd,1a[tiowa *,t and aviiiini .; =,t ritpl ;rtnin ni,ihe t %tr to g kw t,t31 Te it Ir'ttk..gi% 'fl tt i i the vesrt,tr>.d Jii`re�tiy,%kg"fix.r re:°'Jed 64i r rfii6 f i t it fAg riv.t°ilrt4ce dr%1afl jtitt in I bns ,. 2,02 .,vdo It-z.4,1 [Ike 14 hrt c the...option of A5timim our enitfe i +u td Qc 1Ln 1J"'sr 11it ii.,;dh the yrtt hi E 110;L.it, idly 0.11 vitir.e hiriase, v e kith too get i'trentrAgo ixorri thn fifty.. <lit,s niti :h r. a,t arc till rise,llite 6 hit;te ril rrrs iolt# 1,for el 0 iaJeS We IA timid like to rYs)ttl ci er 10 the sar11 to u n y>—i Or in the L1t 5i"4.ii erei thAt ke lip inn tt°eita at am.% rtaFser,ime..Cr l alls4 Fieid i i,ire:l'itid 1# kf:, .Arai$Nelit,o11 tirldN We hint done nur reSealeal gild the >1,i9rg.k th are uf'l1,:itinie lino QC 1,. 1rrr.''t*irin Parkes y Spain teem narinalh Ji..tt deed.p1a. 'ii-I thmaer and tdr there K.entl down before the rird competitive ihei,. Wb %c.d do 1.a;;p9 Adi r tile.. ata a will SfrsZit teallr thy Matt vis re*Cuiaitr fe,c.igt114 tieiOittittitetotlatuf therefort c.3 p.,:nif3..110 pets ur.4 iigt wash* .'W'e.will only rrut ttv 4 .tar Wate4 f'arsiiii>gs and pain) end 1 will either be n ynn in the tea mar the game ar I si rthiti awl at my dsiatyhi s h iu e. Vita Win atr;i edviYe All tv14er that We Will be TA Khriktet the int/petty during their i ).,to met Sire the pail is dean raid the AirMrb home I'allIS Art being t:rt:i$tio ed. Pkikie sive Ili your Mailing wily the Airbitb b signing.this fermi ii rcl*utestiI.Le that 0.e trues tli#eic:+d y ..._ yoti of ottt mini for that tem rxittAl ru 20,11 Plea r,my tell n imb'et 751-1015-4 1ib h elhe is David in rss,a w0u 'die d in VI al :rlii"-iK'f With iti. - �. ' t$dree 1)httne,d _ i TliuA'yols for you/ ii .,.: .::...- ,..., :.._. .. ^s.--. ,..:..... a n.._.-....sue. `.. _• .• .. " � i f . r e• Dear Highland Meadows Neighbor, Danny and I live at 2621 Highland Meadows Way and have submitted our application to the City to allow for Short Term rentals. Through the years and currently,we have rented out rooms in our home, however starting in February 2021,we would like to have the option of Airbnb our entire house occasionally through the year. In order to Airbnb our entire house. we have to get permission from the City. As a neighbor,we would also like to have your condolences for our Airbnb. We would like to mostly cater to the sports teams that are in the Landstown area that are having events at the Sportsplex, soccer fields, Field House.Field Hockey and Softball fields. We have done our research and the closest hotels are off Bonnie Road or Lynnhaven Parkway. Sports teams normally just need a place to shower and lay there head down before the next competitive day. When we do start to advertise, we will specifically say that we are a family friendly neighborhood and therefore no parties, no pets and no smoking. We will only rent to 4 star rated families and Danny and I will either be staying in the room over the garage or 10 minutes away at my daughters house. We will also advise all renters that we will be spot checking the property during their stay to make sure the pool is clean and the Airbnb house rules are being followed. Please give us your blessing with the Airbnb by signing this form to acknowledge that we have advised you of our intent for short term rental in 2021. Please save my cell number 757-406-4510 Kellie Jo David in case you ever need to get in contact with us. Neighbors name: GL_ 1Z12 Ji5 f Address: 2 ti(,�Y_,iG /1, De S 1s1A)•' Phone : 7 G Sign: / Thank you for your support /// • G`, D ,�l r :V Dear Highland Meadows Neighbor. Danny and I live at 2621 Highland Meadows Way and have submitted our application to the City to allow for Short Term rentals. Through the years and currently,we have rented out rooms in our home,however starting in February 2021,we would like to have the option of Airbnb our entire house occasionally through the year. In order to Airbnb our entire house,we have to get permission from the City. As a neighbor,we would also like to have your condolences for our Airbnb. We would like to mostly cater to the sports teams that are in the Landstown area that are having events at the Sportsplex,soccer fields. Field House, Field Hockey and Softball fields. We have done our research and the closest hotels are off Bonnie Road or Lynnhaven Parkway. Sports teams normally just need a place to shower and lay there head down before the next competitive day. When we do start to advertise,we will specifically say that we are a family friendly neighborhood and therefore no parties,no pets and no smoking. We will only rent to 4 star rated families and Danny and I will either be staying in the room over the garage or 10 minutes away at my daughters house. We will also advise all renters that we will be spot checking the property during their stay to make sure the pool is clean and the Airbnb house rules are being followed. Please give us your blessing with the Airbnb by signing this form to acknowledge that we have advised you of our intent for short term rental in 2021. Please save my cell number 757-406-4510 Kellie Jo David in case you ever need to get in contact with as. Neighbors name: NhAvutfi, COO peC _ Address: (a3t4 'tiltltahr MeddowS V�el, Vel.. Ddal \/A r23g5c. Phone nber: C'7 ?'� S-34 5G Sign: Thank you for r pport Dear Highland Meadows Neighbor, Danny and I live at 2621 Highland Meadows Way and have submitted our application to the City to allow for Short Term rentals. Through the years and currently,we have rented out rooms in our home,however starting in February 2021,we would like to have the option of Airbnb our entire house occasionally through the year. In order to Airbnb our entire house,we have to get permission from the City. As a neighbor,we would also like to have your condolences for our Airbnb. We would like to mostly cater to the sports teams that are in the Landstown area that are having events at the Sportsplex,soccer fields,Field House, Field Hockey and Softball fields, We have done our research and the closest hotels are off Bonnie Road or Lynnhaven Parkway. Sports teams normally just need a place to shower and lay there head down before the next competitive day. When we do start to advertise,we will specifically say that we are a family friendly neighborhood and therefore no parties,no pets and no smoking. We will only rent to 4 star rated families and Danny and I will either be staying in the room over the garage or 10 minutes away at my daughters house. We will also advise all renters that we will be spot checking the property during their stay to make sure the pool is clean and the Airbnb house rules are being followed. Please give us your blessing with the Airbnb by signing this form to acknowledge that we have advised you of our intent for short term rental in 2021. Please save my cell number 757-406-4510 Kellie Jo David in case you ever need to get in contact with us. ) Neighbors name: "2. '�' ,1¢-vt'.4.-- ; f / Address: Phone number a �, cT / p _ s` Q Sign: :y a Thank you f r your pport J. APPOINTMENTS 2040 VISION TO ACTION COMMUNITY COALITION ARTS AND HUMANITIES COMMISSION BAYFRONT ADVISORY COMMISSION BIKEWAYS AND TRAILS ADVISORY COMMITTEE CLEAN COMMUNITY COMMISSION COMMUNITY POLICY AND MANAGEMENT TEAM COMMUNITY SERVICES BOARD DEFERRED COMPENSATION BOARD GREEN RIBBON COMMITTEE HAMPTON ROADS PLANNING COMMISSION HEALTH SERVICES ADVISORY BOARD HISTORIC PRESERVATION COMMISSION HOUSING ADVISORY BOARD HUMAN RIGHTS COMMISSION INVESTIGATION REVIEW PANEL MEDAC OLD BEACH DESIGN REVIEW COMMITTEE OPEN SPACE ADVISORY COMMITTEE PERSONNEL BOARD PLANNING COUNCIL PROCESS IMPROVEMENT STEERING COMMITTEE PUBLIC LIBRARY BOARD RESORT ADVISORY COMMISSION SENIOR SERVICES OF SOUTHEASTERN VIRGINIA SOUTHEASTERN PUBLIC SERVICE AUTHORITY TRANSITION AREA/INTERFACILITY TRAFFIC AREA CITIZENS ADVISORY COMMITTEE VIRGINIA BEACH COMMUNITY DEVELOPMENT CORPORATION K. UNFINISHED BUSINESS L. NEW BUSINESS M. ADJOURNMENT *********************** OPEN DIALOGUE Non-Agenda Items Each Speaker will be allowed 3 minutes and each subject is limited to 3 Speakers ********************************** If you are physically disabled or visually impaired and need assistance at this meeting, please call the CITY CLERK'S OFFICE at 3854303 ***************************** The Agenda (including all backup documents) is available at https://www.vbgov.com/government/departments/city-clerk/city-council under the eDocs Document Archive. If you would like to receive by email a list of the agenda items for each Council meeting, please submit your request to pmcgrawAvbgov.com or call 385-4303. If you wish to make comments during the meeting, please follow the two-step process provided below: 1. Register for the WebEx at: https://vbgov.webex.com/vbgov/onstage/g.php?MTID=e1 aba56b760743d7822e70c49e93 a5a3d 2. Register with the City Clerk's Office by calling 757-385-4303 or via email at prior to 5:00 p.m. on March 2, 2021. CITY OF VIRGINIA BEACH SUMMARY OF COUNCIL ACTIONS DATE:02/16/2021 PAGE: 1 B E AGENDA R ITEM# SUBJECT MOTION VOTE A L H W W B U E J R T I 0 B C D N OM 0 0 L W O 0 C Y L NO U W S 0 T T HE E E S S E O O E T I R Y S S E R NDN II. CITY COUNCIL'S BRIEFINGS A. MAYOR'S AFRICAN AMERICAN Dr.Veronica Coleman ROUNDTABLE-POLICE CIVILIAN OVERSIGHT B. SMALL BUSINESS INITIATIVES Taylor Adams,Director UPDATE -Economic Development III. CITY MANAGER'S BRIEFINGS Ray Amoruso,Chief A. MICROTRANSIT DEMONSTRATION Planning& PROJECT AND GRANT FOLLOW-UP Development Officer- Hampton Roads Transit (HRT) Brian Solis,Special Projects Manager-City Manager's Office B. MOTORIZED SCOOTER FRANCHISE Brian Solis,Special LICENSE AGREEMENTS UPDATE Projects Manager-City Manager's Office C. INTERIM FINANCIAL UPDATE Wendy Hu,Acting Co- Director-Finance C. MINUTES APPROVED 10-0 Y Y Y Y Y Y Y Y Y A Y 1. SPECIAL SESSION December 15,2020 T A N E D MINUTES APPROVED 10-0 Y Y Y Y Y Y Y Y Y A Y 2. SPECIAL SESSION January 26,2021 T A N E D 3. MINUTES APPROVED 10-0 Y Y Y Y Y Y Y Y Y A Y SPECIAL SESSION February 2,2021 T A N E D D. MAYOR'S PRESENTATION RESCHEDULED APPRECIATION OF ROBERT PRESTON MIDGETT II E. PUBLIC HEARING 1. APPROPRIATION OF PANDEMIC NO SPEAKERS RELIEF RESERVE FUNDING CITY OF VIRGINIA BEACH SUMMARY OF COUNCIL ACTIONS DATE:02/16/2021 PAGE: 2 B AGENDA ITEM# SUBJECT MOTION VOTE R A L H W W B U E J R T I 0 B C DNOMO 0 L W 0 O C Y L NOUWS 0 T THEE E S S E O O E T I R Y S S ER NDN G.1. Ordinance to APPROPRIATE from the ADOPTED 11-0 Y Y Y Y Y Y Y Y Y Y Y Fund Balance of the General Fund: $12.4-Million to United Way of South Hampton Roads re small business grants; $350,000 to Parks&Recreation Department re Summer Youth Employee Program; $309,000 to Police Department re body worn camera program;and $3,518,767 to City Council Special Pandemic and Vaccine Support Reserve re future unforeseen pandemic expenses G.2. Ordinance to DECLARE 2.361+/-acres at ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y 5694 Wesleyan Drive in EXCESS of the CONSENT City's needs and AUTHORIZE the City Manager to sell same to Ebenezer Baptist Church re overflow parking needs G.3. Resolution to DIRECT the City Manager ADOPTED,AS 8-3 Y Y N Y Y NY Y Y N Y to create a Virginia Beach Small Business AMENDED,BY Initiative division within the Virginia CONSENT Beach Website re outreach and support for small businesses(Requested by Council Member Wooten) G.4. Ordinance to AUTHORIZE a$5,000 ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y micro-grant to Am I My Brother's Keeper CONSENT re essential life services and assistance to homeless individuals(Requested by Mayor Dyer) G.5. Ordinance to CONVERT a part-time ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y position(0.61 FTE)to a full-time position CONSENT (1.0 FTE)in the Office of the City Attorney and AUTHORIZE a transfer of funds from available appropriations re telecommunication legal services G.6. Ordinances to ACCEPT and APPROPRIATE: a. S72,500 from VB Home Now,Inc.to ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y FY2020-21 Housing and Neighborhood CONSENT Preservation Operating Budget re housing assistance programs b. $450,000 from Virginia Department of ADOPTED 11-0 Y Y Y Y Y Y Y Y Y Y Y Criminal Justice Services to FY2020-21 Police Department Operating Budget re purchase of software,and training and development services to assist with the recruitment and retention of sworn personnel and support criminal justice reform CITY OF VIRGINIA BEACH SUMMARY OF COUNCIL ACTIONS DATE:02/16/2021 PAGE: 3 B E AGENDA R ITEM# SUBJECT MOTION VOTE A L H W W B U E J R T I 0 B C D N OMO 0 L W 0 O C Y L NOUWS O T T HEE E S S E O O E T I R Y S S ERNDN c. $20,000 from Virginia Department of ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y Criminal Justice Services to FY2020-2I CONSENT Police Department Operating Budget re Southern Virginia Internet Crime Against Children(ICAC)investigations d. $26,379.68 from Virginia Department of ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y Health to FY2020-21 Emergency Medical CONSENT Services(EMS)Operating Budget re support rescue squad operations and training e. $150,000 from What Works Cities to ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y FY2020-21 Economic Development CONSENT Operating Budget re early childhood language development program £ $74,804 from Virginia Department of ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y Emergency Management to FY2020-21 CONSENT Emergency Management Operating Budget and AUTHORIZE a local match from existing resources re support of COVID- 19 vaccinations and health equity initiatives for vulnerable populations G.7. Ordinance to TRANSFER$800,000 from ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y Debt Service in the General Fund to CONSENT FY2020-21 Voter Registration and Elections Operating Budget re June 2021 Primary Election expenses H.1. WOODHOUSE LIMITED APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y PARTNERSHIP for a Variance to Section CONDITIONED,BY 4.4(b)of the Subdivision Regulations re CONSENT minimum lot width and street line frontage requirements at 1805 Estates Court DISTRICT 5—LYNNHAVEN H.2. BOAZ BENJAMIN BROTHERS fora APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y Variance to Section 4.4(b)of the CONDITIONED,BY Subdivision Regulations re combine three CONSENT (3)existing parcels into one(1)lot at 1944 Pleasant Ridge Road DISTRICT 7— PRINCESS ANNE H.3. THOMAS A.BROWN fora Variance to DEFERRED 11-0 Y Y Y Y Y Y Y Y Y Y Y Section 4.4(b&d)of the Subdivision INDEFINITELY Regulations re direct access to a public street and street line frontage requirements at 2888 Indian River Road DISTRICT 7—PRINCESS ANNE H.4. MICHAEL&FELICIA JULIANO for a APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y Street Closure re 7.5 foot by 50-foot CONDITIONED,BY portion of an unimproved alley adjacent CONSENT to 804 Vanderbilt Avenue DISTRICT 6— BEACH CITY OF VIRGINIA BEACH SUMMARY OF COUNCIL ACTIONS DATE:02/16/2021 PAGE: 4 B AGENDA ITEM# SUBJECT MOTION VOTE A L B U E J R T I 0 B C D N OMO 0 L W 0 O C YLNOUWS 0 T T HEE E S S E O O E T I R Y S S ERNDN H.5. FIVE POINTS,LLC for a Modification APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y of Proffers re install drive-through aisle MODIFIED,BY and small retaining wall at 2005 CONSENT Lynnhaven Parkway DISTRICT 3—ROSE HALL(Approved February 27,1996) H.6. ST.JOHN THE APOSTLE APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y CATHOLIC CHURCH&SCHOOL/ MODIFIED,BY THE ROMAN CATHOLIC DIOCESE CONSENT OF RICHMOND for a Modification of Conditions re religious use and private school at 1968 Sandbridge Road DISTRICT 7—PRINCESS ANNE (Approved August 24,1993) 1L7. WILSON R.BALLANCE,JR.,fora APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y Conditional Change of Zoning from AG-2 PROFFERED Agricultural District to Conditional R-5D Residential District re create two(2) single family building lots at 621 Dam Neck Road DISTRICT 7—PRINCESS ANNE H.8. OLD DAM NECK,LLC/FRANCES G. APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y WILLIS,WILLIAM E.GILBERT, PROFFERED/ BONNIE J.GARRETT,CATHERINE CONDITIONED D.MEREDITH,AND JOHN J. WEINBRECHT,JR., for a Conditional Change of Zoning from AG-2 Agricultural District to Conditional B-2 Community Business District and a Conditional Use Permit re mini warehouse at 1081,1087, 1089 Old Dam Neck Road and an adjacent parcel West of 1089 Old Dam Neck Road DISTRICT 7—PRINCESS ANNE H.9. WILLIAM T.&CAROLYN DALE APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y WEEMS for a Conditional Use Permit re CONDITIONED outdoor recreation facility at 1420 Claudia Drive DISTRICT 4—BAYSIDE H.10. ASIA MITCHELL/TOUZOS FAMILY, APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y LP for a Conditional Use Permit re beauty CONDITIONED,BY salon at 4654 Haygood Road,Suite D CONSENT DISTRICT 4—BAYSIDE H.11. XPERT SERVICES,LLC/VB DEFERRED TO 11-0 Y Y Y Y Y Y Y Y Y Y Y INVESTMENTS,LLC for a Conditional MARCH 16,2021 Use Permit re car wash facility at 4937 Broad Street DISTRICT 4—BAYSIDE H.12. VERDAD REAL ESTATE& APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y CONSTRUCTION/SRGS,LLC, CONDITIONED PENNY R.PITTS REVOCABLE LIVING TRUST,&ADAMS OUTDOOR LIMITED PARTNERSHIP for a Conditional Use Permit re automobile service station at 4493 Shore Drive DISTRICT 4—BAYSIDE CITY OF VIRGINIA BEACH SUMMARY OF COUNCIL ACTIONS DATE:02/16/2021 PAGE: 5 B AGENDA ITEM# SUBJECT MOTION VOTE R A L B U E J R T I 0 B C D N OMO 0 L W 0 O C YLNOUWS O T T HEE E S S E O O E T I R Y S S ERNDN H.13. BRANT FELDMAN fora Conditional APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y Use Permit re outdoor recreation facility CONDITIONED,BY (skateboard ramp)at 1708 River Court CONSENT DISTRICT 5—LYNNHAVEN H.14. JANICE HART fora Conditional Use APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y Permit re home-based wildlife CONDITIONED,BY rehabilitation facility at 1203 Gunn Hall CONSENT Drive DISTRICT 7—PRINCESS ANNE H.15. HOME DEPOT,U.S.A.,INC.for APPROVED/ 11-0 Y Y Y Y Y Y Y Y Y Y Y Conditional Use Permits re bulk storage CONDITIONED,BY yard,and truck&trailer rentals at 2324 CONSENT Elson Green Avenue DISTRICT 7— PRINCESS H.16. CITY OF VIRGINIA BEACH— ADOPTED,BY 11-0 Y Y Y Y Y Y Y Y Y Y Y Ordinance to ADOPT and CONSENT INCORPORATE into the Virginia Beach Comprehensive Plan the Virginia Beach Active Transportation Plan 2021 to supersede the Virginia Beach Bikeways and Trails Plan 2011 and AMEND Section 2.1 re active transportation UJ/K ADJOURNMENT 7:56 P.M.