REGULAR CITY COUNCIL MEETING AGENDA
City Hall - Council Chambers
4381 Broadway St., Suite 201, American Canyon
October 15, 2024
6:30 PM
Tonight's mee'ng is a limited public forum. American Canyon promotes respec0ul and responsible behavior among its mee'ng par'cipants, whether they are present in person or remotely. Using offensive language or remarks that promote, foster, or perpetuate discrimina'on based on race, creed, color, age, religion, gender marital status, status regarding public assistance, na'onal origin, physical or mental disability or sexual orienta'on/gender iden'fica'on, as well as any other category protected by federal, state or local laws will not be tolerated. In the case of an occurrence, the speaker will be immediately disconnected from the microphone.
PUBLIC PARTICIPATION
City Council and other public mee"ngs will be conducted in person. This mee"ng is also available via Zoom, is broadcast live to residents on Napa Valley TV, on our website and on YouTube.
Zoom Link: Click here. Webinar ID: 849 9699 3806; Passcode: 12345. Phone in to Zoom: 408-638- 0968
Oral comments, during the mee'ng: Oral comments can be made in person during Open and Closed Session or through Zoom in Open Session only. On Zoom use the "raise your hand" tool during any public comment period. To avoid confusion, hands raised outside of Public Comment periods will be lowered.
Wri;en comments: Submit wri4en comments by the eComments link, located on the Mee"ngs & Agendas page of our website. eComments are available to council members in real "me. To allow for Council review of comments, eComments will close at 3:00 pm on the day of the meeting.
The above iden"fied measures exceed all legal requirements for par"cipa"on in public comment, including those imposed by the Ralph M. Brown Act. For more informa"on, please call the Office of the City Clerk at (707) 647-4369 or email [email protected].
AGENDA MATERIALS: City Council agenda materials are published 72 hours prior to the mee"ng and are available to the public via the City’s website at www.americancanyon.gov.
AMERICANS WITH DISABILITIES ACT: The City Council will provide materials in appropriate alterna"ve formats to comply with the Americans with Disabili"es Act. Please send a wri4en request to City Clerk at 4381 Broadway, Suite 201, American Canyon, CA 94503 or by email to [email protected]. Include your name, address, phone number and brief descrip"on of the requested materials, as well as your preferred alterna"ve format or auxiliary aid, at least three calendar days before the meeting.
Mayor: Leon Garcia
Vice Mayor: David Oro
Councilmembers: Mariam Aboudamous, Mark Joseph, Pierre Washington CITY COUNCIL MEETING AGENDA OCTOBER 15, 2024
1 5:30 P.M. – CLOSED SESSION
The mayor will call the meeng to order and conduct roll call. Council will immediately convene into Closed Session aer hearing any public comment on Closed Session items. At 6:30 p.m. the Council will reconvene into Open Session and then resume Closed Session at the end of the meeting to address outstanding items, if necessary.
CALL TO ORDER - CLOSED SESSION
ROLL CALL - CLOSED SESSION
PUBLIC COMMENTS - CLOSED SESSION ITEMS
This me is reserved for members of the public to address the City Council on Closed Session Items only. Comments must be made in person and are limited to 3 minutes. Comments for items on the Open Session agenda will be taken when the item is called in Open Session. Comments for Items not on the Closed Session or Open Session agenda will be heard during the Open Session Public Comment period.
MEETING RECESS - COUNCIL TO CONVENE IN CLOSED SESSION
5:30 P.M. CLOSED SESSION ITEMS
1. Conference with Legal Counsel – An'cipated Li'ga'on. Authorized pursuant to Government Code Section 54956.9 (d)(2). Three (3) Matters.
Recommendation:
2. Conference with Legal Counsel - Exis'ng Li'ga'on. Authorized pursuant to Government Code Section 54956.9(d)(1):
a. City of American Canyon v. City of Vallejo, et al. (Sacramento Superior Court Case No. 34-2022-00327471).
b. City of Vallejo v. City of American Canyon et al . (Third District Court of Appeal Case No. C102070; formerly Sacramento County Superior Court Case No. 23WM000055). c. City of Vallejo v. City of American Canyon et al . (Sacramento County Superior Court Case No. 24WM000078).
d. City of Vallejo v. City of American Canyon et al. (Marin County Superior Court Case No. CV0003752).
6:30 P.M. OPEN SESSION - REGULAR MEETING
CALL TO ORDER - COUNCIL TO RECONVENE IN OPEN SESSION
PLEDGE OF ALLEGIANCE
ROLL CALL - OPEN SESSION
REPORT ON CLOSED SESSION/CONFIRMATION OF REPORTABLE ACTION
PROCLAMATIONS AND PRESENTATIONS
CITY COUNCIL MEETING AGENDA OCTOBER 15, 2024
2 3. Proclamation - Domestic Violence Awareness Month
4. Proclamation - Veterans Day 2024
5. Oath of Office for Assistant Public Works Director Norman Woods
6. Appointment of Youth Commissioners
Recommendation: Appoint by minute order Youth Commissioners: Ramandeep Kaur Jawanda to the Planning Commission, Heather Mora to the Parks and Community Services Commission, and Calix Joel Delos Santos Mintalar to the Open Space, Ac"ve Transporta"on, and Sustainability Commission; and direct the City Clerk to administer an Oath of Office to the Youth Commissioners.
PUBLIC COMMENTS - ITEMS NOT ON CLOSED SESSION OR OPEN SESSION AGENDA This me is reserved for members of the public to address the City Council on items that are not on the Closed Session or Open Session agenda and are within the subject ma(er jurisdicon of the City Council. Comments are limited to 3 minutes. Comments for items on the Open Session agenda will be taken when the item is called in Open Session.The City Council is prohibited by law from taking any acon on ma(ers discussed that are not on the agenda, and no adverse conclusions should be drawn if the City Council does not respond to public comment at this time.
AGENDA CHANGES
The Mayor and Council may change the order of the Agenda or request discussion of a Consent Item. A member of the Public may request discussion of a Consent Item by making that request during Public Comment.
CONSENT CALENDAR
7. Minutes of October 1, 2024
Recommendation: Approve the minutes of the Regular City Council Mee"ng of October 1, 2024.
8. Report Upon Return from Closed Session
Recommendation: Approve the Report Upon Return from Closed Session for the Regular City Council meeting of October 1, 2024.
9. Oat Hill Final Map
Recommendation: Adopt a Resolu"on taking the following ac"ons in conjunc"on with the Oat Hill Multi Family Residential Project:
1. Amend the two Final Maps approved under Resolution 2022-32; and
2. Approve the revised Final Maps to subdivide the Property for development of 291 residen"al condominium units and associated ameni"es on Parcels 1 & 2 and to accept the referenced dedications offered thereon.
10. Adop'on of Caltrans Local Assistance Procedures Manual Chapter 10: Consultant Selection
Recommendation: Adopt Caltrans Local Assistance Procedures Manual Chapter 10:
Consultant Selection
CITY COUNCIL MEETING AGENDA OCTOBER 15, 2024
3 11. Renegotiated Administrative Service Agreement with MissionSquare Retirement Recommendation: Adopt a Resolu"on approving a renego"ated Administra"ve Service Agreement with MissionSquare Retirement.
12. Water Reclamation Facility Membrane Replacement
Recommendation: Adopt a Resolu"on authorizing the City Manager to execute a purchase agreement with Veolia Water Technologies and Solu"ons for the procurement of eight hundred ninety-six (896) "ZW500D RX12 430 O²” membrane modules, twelve (12) ZW500D LEAPmbr 16M casse4e frames, and associated materials for exis"ng casse4e refurbishment and LEAPmbr upgrade, for use at the Water Reclama"on Facility for a total cost of $3,121,330 and amending the Fiscal Year 2024/25 budget to increase Wastewater Opera"ons Fund 540 by $422,087 and Wastewater Capacity Fee Fund 550 by $202,179 to account for the current Year 1 membrane cost of $624,266.
PUBLIC HEARINGS
13. City Council Code of Conduct and Governance Protocols Recommendation: Waive first reading and introduce by "tle only an ordinance modifying American Canyon Municipal Code Chapter 2.04.050 "Adop"on of procedures." to establish a City Council Code of Conduct and Governance Protocols.
BUSINESS
14. Newell Drive Extension
Recommendation: Receive and file and update on the extension of Newell Drive.
MANAGEMENT AND STAFF ORAL REPORTS
15. Q2 FY24/25 Capital Project Schedule Update
Recommendation: Informational item with City Council feedback
MAYOR/COUNCIL COMMENTS AND COMMITTEE REPORTS
The Mayor and Council may comment on ma(ers of public concern and announce ma(ers of public interest; no collective council action will be taken.
FUTURE AGENDA ITEMS
16. Future Agenda Items of Note
ADJOURNMENT
CERTIFICATION
I, Taresa Geilfuss, City Clerk for the City of American Canyon, do hereby declare that the foregoing agenda of the City Council was posted in compliance with the Brown Act prior to the meeting date. ______________________________________
Taresa Geilfuss, CMC, City Clerk
CITY COUNCIL MEETING AGENDA OCTOBER 15, 2024
4 CIT
YCOUNCILMEETINGAGENDAOCTOBER15,2024
5 CITY OF AMERICAN CANYON
PROCLAMATION
Domestic Violence Awareness Month – October 2024
WHEREAS, NEWS, Domestic Violence and Sexual Abuse Services is commemorating 43 years of service to survivors of domestic violence (DV) in Napa County, having opened the first confidential safe house on October 5th, 1981, and began providing safety to those escaping abuse; and WHEREAS, every year since 1989, the United States Congress has proclaimed October as Domestic Violence Awareness Month (DVAM), renewing our Country’s commitment to standing against domestic violence and meeting the needs of survivors; and
WHEREAS, DVAM is about raising awareness and uplifting the needs, voices and experiences of survivors.
This year’s national campaign of “Heal, Hold & Center” calls on us to ponder how our community is helping to heal, holding space for, and centering the voices of marginalized survivors; and WHEREAS, DV is a public health concern that impacts the well-being and success of individual community members, as well as the community as a whole. Data shows that nearly 1 in 3 women and 1 in 4 men in the U.S. report experiencing severe physical violence from an intimate partner in their lifetime while nearly half of U.S. adults have experienced psychological aggression such as humiliating or controlling behaviors from their partner. DV can cause severe physical and emotional distress for survivors who are more likely to become suicidal and lose economic opportunities from the abuse. Children who witness abuse are likely to experience abuse themselves and are often used to control other family members which can have lifelong impacts on their mental health. Aside from the obvious physical and emotional trauma inflicted, DV contributes to over 10% of all intentional violent deaths (not including suicide) and costs America over 8 billion dollars a year; and
WHEREAS, by observing October as DVAM we show that our community is committed to supporting survivors and working toward the prevention of DV among future generations; and WHEREAS, in Fiscal Year 2023/2024 NEWS provided services to over 1,700 of our Napa County community members, including 24-hour response, assistance with protective orders, safety and shelter, permanent housing, financial aid, support groups and children’s services, for issues related to violence in the home; and
NOW, THEREFORE LET IT BE RESOLVED THAT I, Leon Garcia, Mayor, on behalf of the City Council of the City of American Canyon, do hereby proclaim October 2024 as “Domestic Violence Awareness Month”, and encourage all residents of American Canyon to honor domestic violence survivors and those who serve them during this month and throughout the year.
Dated: September 17, 2024
__________________________
Leon Garcia, Mayor
6 CITY OF AMERICAN CANYON
PROCLAMATION
Veterans Day, 2024
WHEREAS, November 11th is the anniversary of the armistice signed by the Allies and the Germans in 1918, which ended World War I after four years of conflict. President Woodrow Wilson issued the first Armistice Day proclamation in November of 1919, and set the tone for further observances; and WHEREAS, the name changed from Armistice Day to Veterans Day by an act of Congress in 1954, when President Eisenhower called on citizens to observe the day in honor of all who had served in America’s wars through the years; and
WHEREAS, the City of American Canyon recognizes the significant and lasting contributions made by our veterans, who have dedicated their lives to the service of our great nation; and WHEREAS, the history of the United States is rich with the deeds of those American Canyon residents who have served in our Armed Forces with honor and distinction; and WHEREAS, today we recognize these courageous men and women who represent the best our nation and community have to offer and, with their service, these veterans have proven that America’s freedoms are worth protecting; and
WHEREAS, our community is deeply grateful for the sacrifices made by our veterans and their families, and we will continue to work tirelessly to ensure that they receive the care, support, and respect they deserve; and
WHEREAS, we invite the American Canyon community to join us in honoring the brave men and women who have served our country at the Veterans Day Ceremony on November 11, 2024. The ceremony will take place at 11:00 a.m. in the American Canyon Middle School Gymnasium. Together, we proudly recognize and pay tribute to the veterans of the past, present, and future.
NOW, THEREFORE, BE IT RESOLVED that I, Leon Garcia, Mayor of the City of American Canyon, on behalf of the City Council, do proclaim November 11, 2024, as Veterans Day in American Canyon.
Dated: October 15, 2024 ____________________________________ Mayor Leon Garcia
7 Name Commission You are
Applying For:
1. Tell us about yourself and why you want
to be a Youth Commissioner:
2. Why should we select you over the other candidates? 3. What would you like to accomplish while serving as a Youth Commissioner?
4. What is your vision for the future of American Canyon? 5. Is there anything else you would like to us to consider when reviewing your appilcation?
Heather Mora Parks & Community
Services Commission
I am an enthusiastic and committed
individual currently serving as a leader for
freshmen, where I focus on helping new
students acclimate to high school life. In
addition to this role, I hold leadership
positions in two clubs, which have provided
me with valuable experience in teamwork,
organization, and event planning. I have a
strong passion for creating engaging activities
that foster community and connection among
my peers.
I want to be a Youth Commissioner for the
city because I believe in the power of youth
voices in shaping our community. I am eager
to advocate for the needs and interests of
young people. My love for planning and
organizing events will enable me to develop
initiatives that address the issues facing our
youth, from mental health support to
educational opportunities. I am excited about
the opportunity to collaborate with city
leaders and fellow youth to create a positive
impact and make our city a better place for
all residents.
I am excited to apply for a position on The Parks and Community Services Commission, as I am deeply passionate about enhancing our community's recreational spaces and programs. My experience as a leader for freshmen has instilled in me the importance of fostering a welcoming and inclusive environment, which I believe is essential for the effective use and development of our parks and recreational facilities.
In my leadership roles within two clubs, I have successfully organized activities that promote community engagement and encourage students to be part of the community that we have here in American Canyon. I am particularly interested in advocating for programs that not only enhance recreational opportunities but also emphasize the importance of confronting issues within the community.
I understand that the Commission plays a vital role in advising the City Council on park development and recreation programming. I am eager to contribute my insights and ideas to ensure that our parks are accessible, well-maintained, and equipped to meet the diverse needs of our community. My passion for planning and organizing events will enable me to help create engaging recreational programs that bring people together and promote a healthy, active lifestyle.
By serving on The Parks and Community Services Commission, I hope to work collaboratively with fellow members and the City Council to enhance our community's parks and recreational offerings, ensuring they are vibrant spaces that foster connection, well-being, and enjoyment for all residents. Thank you for considering my application.
As a candidate for The Parks and Community Services
Commission, I am eager to enhance our community's parks and recreational facilities by advocating for improved
accessibility and inclusive programming that caters to all residents. My goal is to promote community engagement
through events that encourage the use of our parks, while also supporting sustainable development practices that
protect our natural resources. I believe in the importance of involving youth in the planning process to ensure that their interests are represented, fostering a sense of ownership and responsibility among the younger generation. By addressing gaps in recreation programming and gathering community
feedback, I aim to develop initiatives that reflect the diverse needs of our residents, ultimately contributing to a vibrant and connected community. Thank you for considering my
application.
My vision for the future of American Canyon is to create a vibrant, inclusive, and sustainable community that prioritizes the wellbeing of its residents while preserving the natural beauty of the area. I envision a city where parks and recreational facilities are accessible to all, providing diverse programming that encourages active lifestyles, community engagement, and social connection.
I see American Canyon as a place where youth voices are valued and integrated into decision-making processes, fostering a sense of ownership and responsibility among the younger generation.
Additionally, I envision enhanced green spaces and
environmentally sustainable practices that promote conservation and protect our local ecosystems.
Furthermore, I aspire to see a strong sense of community pride, where residents actively participate in local events and initiatives, strengthening relationships and collaboration among neighbors. By focusing on these key areas, I believe we can build a thriving American Canyon that meets the needs of all its residents while ensuring a bright and sustainable future In addition to my qualifications and vision for the role, I would like you to consider my deep commitment to
community service and my proactive approach to problemsolving. I have consistently sought opportunities to engage with my peers and the broader community, through
organizing events that promote kindness and inclusivity. My ability to listen to diverse perspectives and collaborate effectively with others will enable me to represent the interests of our community thoughtfully and effectively. I am passionate about making a positive impact and am
eager to bring my energy, creativity, and dedication to The Parks and Community Services Commission. Thank you for
considering my application; I look forward to the
opportunity to contribute to the future of American Canyon.
Ramandeep Kaur Jawanda Any Available Commission
My name is Ramandeep Kaur Jawanda. I have
been living in American Canyon through out
my high school years. I am a senior at ACHS. I
have seen the potential for this city to have a
value for its residents and its population. As
of this time this city has been the most
underserved 21,432 residents. As growing
city there’s a potential economic opportunity
for the residents of American Canyon. I want
to help grow this city into a thriving
community of diverse people.
The reason why you should select me over the other candidates because I want to improve on youth engagement and infrastructure. What I mean by that is providing youth with positive activities including sports, arts, tutoring and other educational programs to keep them engaged and away from potentially harmful effects on our community because a growing community comes with a lot of responsibilities and with that comes growth in aspects such as crime.
I would like to accomplish a growing community with
activities for youth development for their learning abilities because of the troubles they see and struggles they face with My vision for the future of American Canyon is having open sources for works, education programs for those who need them.
Providing fundraiser for sheriff department, firefighters advocate a positive and safe environment.
I want you to consider when reviewing my application that people with different disabilities can have a chance to improve on themselves with different programs that we will provide for the community.
Calix Joel Delos Santos Mintalar Any Available Commission My name is Calix Joel Delos Santos Mintalar,
but my nickname is CJ. I attend American
Canyon High School, and I want to broaden
my help from school-wide to communitywide matters. Volunteering for numerous community events, like the Tree Lighting,
Reindeer Run, Wetlands Beautification, etc. I
came to realize how beautiful this community
is. Everyone is so very close and loving, it
makes American Canyon the safe and
comfortable environment it is today. Taking
further initiative, I want to apply my thoughts
and be able to voice out possible ways to help
this community even more!
Working hard at American Canyon High School, I integrate my abilities through Leadership helping plan out school-wide and community-wide events like Homecoming, AC's Night Out, and Trunk or Treat, I spend a lot of my time after school volunteering and making these events come to life. In addition, I also had experience working with younger ages through Link Crew, an organization in American Canyon High that helps make incoming Freshmen comfortable with their new environment. That includes creating events, playing games, and simply helping them around campus. These qualities and skills that I have acquired can help me as a Youth Commissioner, providing me with the appropriate skills and knowledge to further ensue a greater community in American Canyon.
I would like to make a difference, somehow. More specifically I want to make our community thrive. The open spaces, the wetlands trails, the various food trucks; I want to make sure everyone is content and happy where they are. Maintaining peace and maybe acquiring more environmentally friendly opportunities, I want our community to be beautiful in it's own way. One idea may be the revitalization of our community garden across from Gladwell Park.
In the future, I envision a community where everyone is heard and has an opportunity. In AC, everyone should be able to jumpstart a business, or be able to show off what they love. Even more specific, we could put more emphasis on those who work hard every day, like an appreciation day for anyone who deserves it. In summary, the future of American Canyon is full of kindness and possibility. Moreover, with beautiful trees and flowers, I believe that American Canyon greenery could bring out more people to walk and bike. There are numerous trails and sidewalks that people can use every day! Seeing people walking their pets, riding bikes, or simply walking is another vision of mine for American Canyon.
Living in American Canyon as a citizen for almost my entire life, I found it a very comfortable and amazing place.
Attending American Canyon High School, or simply walking around town with my friends, I can visually see this
community's safety and prettiness. Attending various
social events, I have taken in the comforting environment American Canyon creates with all its citizens. Small
businesses are being promoted, and there are attractions for everyone and countless ways for everyone to love and have fun with each other in this environment.
Becoming a Youth Commissioner would be an amazing
opportunity, putting my foot forward to help this lovely community I strive for the goodness of this town and my input on the amazing things yet to come!
8 CITY OF AMERICAN CANYON
REGULAR CITY COUNCIL MEETING
ACTION MINUTES
October 1, 2024
5:30 P.M. – CLOSED SESSION
CALL TO ORDER - CLOSED SESSION
The City Council meeting was called to order at 5:32 p.m.
ROLL CALL - CLOSED SESSION
Present: Councilmember Pierre Washington, Vice Mayor David Oro, Mayor Leon Garcia
Absent: None
Excused: Councilmember Mariam Aboudamous, Councilmember Mark Joseph
PUBLIC COMMENTS - CLOSED SESSION ITEMS
Mayor Garcia called for public comments. Written comments: none. Oral comments: none. The public comment period was closed.
MEETING RECESS - COUNCIL TO CONVENE IN CLOSED SESSION
5:30 P.M. CLOSED SESSION ITEMS
1. Conference with Legal Counsel – Anticipated Litigation. Authorized pursuant to Government Code Section 54956.9 (d)(2). Three (3) Matters.
Action:
2. Conference with Legal Counsel - Existing Litigation. Authorized pursuant to Government Code Section 54956.9(d)(1):
a) City of American Canyon v. City of Vallejo, et al. (Sacramento Superior Court Case No. 34- 2022-00327471).
b) City of Vallejo v. City of American Canyon et al. (Sacramento County Superior Court Case No. 23WM000055).
c) City of Vallejo v. City of American Canyon et al. (Sacramento County Superior Court Case No. 24WM000078).
d) City of Vallejo v. City of American Canyon et al. (Marin County Superior Court Case No.
CV0003752).
9 6:30 P.M. OPEN SESSION - REGULAR MEETING
CALL TO ORDER - COUNCIL TO RECONVENE IN OPEN SESSION
The City Council meeting was called to order at 6:33 p.m.
PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was recited.
ROLL CALL - OPEN SESSION
Present: Councilmember Pierre Washington, Vice Mayor David Oro, Mayor Leon Garcia
Absent: None
Excused: Councilmember Mariam Aboudamous, Councilmember Mark Joseph
REPORT ON CLOSED SESSION/CONFIRMATION OF REPORTABLE ACTION A report on Closed Session and confirmation of a written report on reportable action was given by City Attorney William Ross.
PROCLAMATIONS AND PRESENTATIONS
3. Proclamation - Filipino Heritage Month
Mayor Garcia announced the Filipino Heritage Month proclamation. It was received by President Jodl Cruz and other members of Fil-am American Canyon.
4. Proclamation - October 2024 National Code Compliance Appreciation Month Mayor Garcia announced the proclamation. It was received by Community Development Director Brent Cooper and Code Enforcement Officer Tiffany Ford.
5. Proclamation - National Community Planning Month 2024 Mayor Garcia announced the proclamation. It was received by Planning Commissioner Brando Cruz, Planning Commissioner Davet Mohammed, Community Development Director Brent Cooper, Senior Planner William He, Deputy City Clerk Nicolle Hall, Code Enforcement Officer Tiffany Ford and Permit Technician Laura Welch.
PUBLIC COMMENTS - ITEMS NOT ON CLOSED SESSION OR OPEN SESSION AGENDA Mayor Garcia called for public comments. Written comments: none. Oral comments: Melissa Lamattina was called to speak; Justin Hamilton Hole was called to speak. The public comment period was closed.
AGENDA CHANGES
There were no changes to the agenda.
10 CONSENT CALENDAR
Action: Motion to adopt CONSENT CALENDAR made by Councilmember Pierre Washington, seconded by Vice Mayor David Oro, and CARRIED by roll call vote.
Ayes: Councilmember Pierre Washington, Vice Mayor David Oro, Mayor Leon Garcia Nays: None
Abstain: None
Excused: Councilmember Mariam Aboudamous, Councilmember Mark Joseph
6. Minutes of September 17, 2024
Action: Approved the minutes of the Regular City Council meeting of September 17, 2024.
7. Report Upon Return from Closed Session
Action: Approved the Report Upon Return from Closed Session for the City Council meeting of September 17, 2024.
8. Contract Amendment #3 with Robert Half International Inc. for Temporary Staffing Services Action: Adopted Resolution 2024-73 authorizing the City Manager to execute Amendment #3 (Agreement 2024-A145) to Agreement No. 2022-A148 with Robert Half International Inc.
PUBLIC HEARINGS
9. Oat Hill Multifamily Residential Major Modification
Council received an Oat Hill Multifamily Residential Major Modification staff report from Community Development Director Brent Cooper. Mayor Garcia opened the public hearing and called for public comments. Written comments: none. Oral comments: none. Public comments and the public hearing were closed.
Action: Motion to adopt Resolution 2024-74 approving a Major Modification to the Oat Hill Multifamily Residential Project Parcel A and B Design Permits located on the east side of Oat Hill south of Napa Junction Road (PL24-0009) made by Vice Mayor David Oro, seconded by Councilmember Pierre Washington, and FAILED by roll call vote.
Ayes: Councilmember Pierre Washington, Vice Mayor David Oro Nays: Mayor Leon Garcia
Abstain: None
Excused: Councilmember Mariam Aboudamous, Councilmember Mark Joseph Council recessed at 7:47 p.m.
Council reconvened at 7:50 p.m.
11 Action: Motion to adopt Resolution 2024-74 approving a Major Modification to the Oat Hill Multifamily Residential Project Parcel A and B Design Permits located on the east side of Oat Hill south of Napa Junction Road (PL24-0009) made by Vice Mayor David Oro, seconded by Councilmember Pierre Washington, and CARRIED by roll call vote.
Ayes: Councilmember Pierre Washington, Vice Mayor David Oro, Mayor Leon Garcia Nays: None
Abstain: None
Absent: Councilmember Mariam Aboudamous, Councilmember Mark Joseph Excused: None
BUSINESS
10. City Council Code of Conduct and Governance Protocols Council received a City Council Code of Conduct and Governance Protocols staff report from City Manager Jason Holley. Mayor Garcia called for public comments. Written comments: none. Oral comments: none. The public comment period was closed. No action was taken on this item.
MANAGEMENT AND STAFF ORAL REPORTS
11. Wastewater Enterprise Update
Council received a Wastewater Enterprise Update presentation from Public Works Director Erica Ahman Smithies.
Council received oral updates from Parks & Recreation Director Alexandra Ikeda and Community Development Director Brent Cooper.
MAYOR/COUNCIL COMMENTS AND COMMITTEE REPORTS
The mayor and council members provided oral reports and announced items of community interest.
FUTURE AGENDA ITEMS
12. Future Agenda Items of Note
ADJOURNMENT
The meeting was adjourned at 8:50 p.m.
CERTIFICATION
Respectfully Submitted,
_____________________________________
Taresa Geilfuss, City Clerk
12 13
William D. Ross
David P. Schwarz
Kypros G. Hostetter
Christina M. Bellardo
Law Offices of
William D. Ross
400 Lambert Avenue
Palo Alto, California 94306
Telephone: (650) 843-8080
www.lawross.com
Los Angeles Office:
11420 Santa Monica Blvd
#25532
Los Angeles, CA 90025
File No: 199/6
October 3, 2024
VIA E-MAIL
The Honorable Leon Garcia, Mayor
and Members of the City Council
City of American Canyon
4381 Broadway, Suite 201
American Canyon, CA 94503
Re: Report Upon Return from Closed Session; Regular City Council Closed Session Meeting of the American Canyon City Council of October 1, 2024 Dear Mayor Garcia and Members of the City Council:
This communication sets forth reportable action, if any, of the City Council (“Council”) of the City of American Canyon (“City”), consistent with provisions of the Ralph M. Brown Opening Meeting Act (Government Code Section 54950, et seq.) resulting from the Closed Session of the Regular City Council Closed Session Meeting of October 1, 2024, consistent with Government Code Section 54957.1.
Mayor Garcia convened the Council1 in Open Session at 5:32 p.m. and after ascertained that there were no public comments on the matters agendized for Closed Session consideration and adjourned to Closed Session at 5:32 p.m.
There were two matters agendized for City Closed Session consideration:
1. Conference with Legal Counsel – Anticipated Litigation Authorized Pursuant to Government Code Section 54956.9(d)(2) Three (3) Matters
2. Conference with Legal Counsel – Existing Litigation
Authorized Pursuant to Government Code Section 54956.9(d)(1) a. City of American Canyon v. City of Vallejo, et al.
(Sacramento Superior Court Case No. 34-2022-00327471);
1 Mayor Garcia, Vice Mayor Oro and Council Member Washington being present. Council Members Joesph and Aboudamous were excused.
14 The Honorable Leon Garcia, Mayor
and Members of the City Council
October 3, 2024
b. City of Vallejo v. City of American Canyon et al. (Napa County Superior Court Case No. 23WM000055)
[Giovannoni Project];
c. City of Vallejo v. City of American Canyon et al.
(Sacramento County Superior Court Case No.
24WM000078) [Paoli/Watson Lane Annexation].
d. City of Vallejo v. City of American Canyon et al. (Marin County Superior Court Case No. CV0003752) [Measure K].
With respect to the three (3) matter considered under Closed Session Agenda Item No. 1., there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(2).
Closed Session Agenda Item No. 2.a., there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(1).
With respect to Closed Session Agenda Item No. 2.b., there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(1).
With respect to Closed Session Agenda Item No. 2.c., there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(1).
With respect to Closed Session Agenda Item No. 2.d., there was no reportable action under the common law attorney-client privilege and that provided by Government Code Section 54956.9(d)(1).
Your Council concluded the Closed Session at 6:11 p.m.
In Open Session, it was indicated that a written report upon return from Closed Session consistent with Government Code Section 54957.1, would be prepared concerning the matters agendized for Closed Session.
This communication should be reviewed under the Consent portion of the Agenda of your next Regular or Special City Council Meeting.
15 The Honorable Leon Garcia, Mayor
and Members of the City Council
October 3, 2024
Should you have questions concerning this Report, it may be taken off the Consent calendar when agendized in the future, or our office may be contacted in the interim.
Very truly yours,
William D. Ross
City Attorney
WDR:jf
cc: Jason B. Holley, City Manager
Maria Ojeda, Assistant City Manager
Taresa Geilfuss, City Clerk
16 CITY COUNCIL AGENDA
OCTOBER 15, 2024
STAFF REPORT
CONSENT
ITEM NUMBER: 9.
TITLE
Oat Hill Final Map
RECOMMENDATION
Adopt a Resolu&on taking the following ac&ons in conjunc&on with the Oat Hill Mul& Family Residential Project:
1. Amend the two Final Maps approved under Resolution 2022-32; and
2. Approve the revised Final Maps to subdivide the Property for development of 291 residen&al condominium units and associated ameni&es on Parcels 1 & 2 and to accept the referenced dedications offered thereon.
CONTACT
Erica Ahmann Smithies, P.E., Public Works Director
Edison Bisnar, P.E., Senior Civil Engineer
BACKGROUND & ANALYSIS
Developer is the owner of certain real property comprised of approximately 20.8 acres on two parcels (Parcel 1 and parcel 2) and located southwest of the Napa Junc&on Road and Hess Road intersection in the City of American Canyon, California (APNs 058-380-008 and 058-320-001).
On May 3, 2022, the City Council of the City of American Canyon approved City Council Resolu&on 2022-32. The Resolu&on approved: 1) two Final Maps to subdivide Oat Hill Property into two parcels; 2) a subdivision improvement agreement; and 3) a reimbursement agreement (See Exhibit A.) The approved Final Maps were preliminary and were never recorded.
On September 9, 2024, the applicant submi@ed two revised Final Maps for Parcel 1 and Parcel 2.
The revised Final Maps differ from the approved Final Maps, showing more public u&lity easements, an emergency vehicle easement, a public access easement and change of ownership (See Exhibit B.) Staff recommends the City Council to 1) amend the two Final Maps approved under Resolu&on 2022-32; and 2) approve the revised Final Maps to subdivide the Property for development of 291 residen&al condominium units and associated ameni&es on Parcels 1 & 2 and to accept the referenced dedications offered thereon.
17 COUNCIL PRIORITY PROGRAMS AND PROJECTS
Not applicable.
FISCAL IMPACT
There is no fiscal impact associated with the proposed action.
ENVIRONMENTAL REVIEW
Consistent with the California Environmental Quality Act, the Oat Hill Mul&family Residen&al Project en&tlements were evaluated in the Oat Hill Mi&gated Nega&ve Declara&on (SCH #2021020107) ("MND") and Mi&ga&on Monitoring Report ("MMRP") approved September 7, 2021 (Resolu&on 2021-61). There have not been any substan&al changes with respect to the circumstances under which implementa&on of the Project would be undertaken that would require major revisions to the previously adopted MND and MMRP. In addi&on, there is no new informa&on of substan&al importance, which was not known and could not have been known at the &me that the MND and MMRP was approved showing that there are new or more severe environmental impacts not addressed in MND and MMRP. Therefore, no further environmental review is required.
ATTACHMENTS:
1. Resolution - Oat Hill Final Map
2. Exhibit A
3. Exhibit B
18 RESOLUTION NO. 2024-
ADOPT A RESOLUTION TAKING THE FOLLOWING ACTIONS IN CONJUNCTION WITH THE OAT HILL MULTIFAMILY RESIDENTIAL PROJECT: 1) AMEND THE TWO FINAL MAPS APPROVED UNDER RESOLUTION 2022-32; AND 2) APPROVE THE REVISED FINAL MAPS TO SUBDIVIDE THE PROPERTY FOR DEVELOPMENT OF 291 RESIDENTIAL CONDOMINIUM UNITS AND ASSOCIATED AMENITIES ON PARCELS 1 & 2 AND TO ACCEPT THE REFERENCED DEDICATIONS OFFERED THEREON.
WHEREAS, Developer is the owner of certain real property comprised of approximately 20.8 acres on two parcels (Parcel 1 and parcel 2) and located southwest of the Napa Junction Road and Hess Road intersection in the City of American Canyon, California (APNs 058-380-008 and 058-320-001); and WHEREAS, on May 3, 2022, the City Council of the City of American Canyon passed CC Resolution 2022-
32. The Resolution approved: 1) two Final Maps to subdivide Oat Hill Property into two parcels; 2) subdivision improvement agreement; and 3) reimbursement agreement. The approved Final Maps were preliminary and was never recorded; and
WHEREAS, on September 9, 2024, the applicant submitted the revised Final Maps for Oat Hill Multifamily project Parcel 1 and Parcel 2. The revised Final Maps differ from the approved Final Maps, in showing more public utility easements, an emergency vehicle easement, a public access easement and change of ownership.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of American Canyon hereby 1) amend the two Final Maps approved under Resolution 2022-32; and 2) approve the revised Final Maps to subdivide the Property for development of 291 residential condominium units and associated amenities on Parcels 1 & 2 and to accept the referenced dedications offered thereon.
PASSED, APPROVED and ADOPTED at a regularly scheduled meeting of the City Council of the City of American Canyon held on the 15th day of October 2024, by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
____________________________
Leon Garcia, Mayor
ATTEST: APPROVE AS TO FORM:
____________________________ _____________________________ Taresa Geilfuss, CMC, City Clerk William D. Ross, City Attorney 19 DocuSign Envelope ID: A930BCC2- FF8D- 4F64-83B6-BBB91D42AE1D 20 DocuSign Envelope ID: A930BCC2- FF8D- 4F64-83B6-BBB91D42AE1D 21 DocuSign Envelope ID: A930BCC2- FF8D- 4F64-83B6-BBB91D42AE1D 22 JOB NO. 1305-050 SHEET
FOR CONDOMINIUM PURPOSES
CONSISTING OF 3 SHEETS
BEING A SUBDIVISION OF PARCEL 1 AS DESCRIBED IN THAT
CERTIFICATE OF COMPLIANCE FOR LOT ADJUSTMENT RECORDED AS
DOCUMENT NUMBER , NAPA COUNTY RECORDS
APN: 058-380-008-000, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW. CBANDG. COM
ROSEVILLE
925) 866-0322
916)788-4456
FINAL MAP OF PARCEL 1
APRIL 2022
1 OF 3
OWNER'S ACKNOWLEDGMENT RECORDER' S STATEMENT
OWNER'S STATEMENT OWNER'S ACKNOWLEDGMENT
23 FOR CONDOMINIUM PURPOSES
CONSISTING OF 3 SHEETS
BEING A SUBDIVISION OF PARCEL 1 AS DESCRIBED IN THAT
CERTIFICATE OF COMPLIANCE FOR LOT ADJUSTMENT RECORDED AS
DOCUMENT NUMBER , NAPA COUNTY RECORDS
APN: 058-380-008-000, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW. CBANDG. COM
ROSEVILLE
925) 866-0322
916)788-4456
FINAL MAP OF PARCEL 1
APRIL 2022
JOB NO. 1305-050 SHEET 2 OF 3
OMISSIONSCITY CLERK'S CERTIFICATE SIGNATURE
VICINITY MAP
SITE
CITY ENGINEER'S STATEMENT
COUNTY TAX COLLECTOR AND
REDEMPTION OFFICER'S CERTIFICATE
SURVEYOR' S STATEMENT
24 PARCEL 1
NAPA JUNCTION ROAD
HESS
ROADLLA 3 OF
3GRAPHIC
50' 400'100' 100' 200' 0' SCALE
0'FORCONDOMINIUM
PURPOSES SCALE:
1" = CONSISTING OF 3
SHEETS BEING ASUBDIVISION OF PARCEL 1AS DESCRIBED IN
THAT CERTIFICATE OF COMPLIANCE FOR LOT ADJUSTMENT RECORDED
AS DOCUMENT NUMBER , NAPA COUNTY
RECORDS APN: 058-380-008- 000, 1 PARCEL, 13.60
AC +/- CITY OF AMERICAN CANYON, NAPA COUNTY
CALIFORNIA APRIL
2022 CIVIL ENGINEERS SURVEYORS
PLANNERS SAN
RAMON WWW. CBANDG.
COM
ROSEVILLE 925) 866-
0322 916)788-
4456 FINAL MAP OF PARCEL
1JOB NO. 1305- 050
SHEET HESS
ROAD BASIS OF
BEARINGS:
REFERENCES:
NOTE:
LEGEND
25 JOB NO. 1305-050 SHEET 1 OF 3
OWNER'S STATEMENT OWNER'S ACKNOWLEDGMENT
RECORDER' S STATEMENT
FOR CONDOMINIUM PURPOSES
CONSISTING OF 3 SHEETS
BEING A SUBDIVISION OF PARCEL 2 AS DESCRIBED IN THAT
CERTIFICATE OF COMPLIANCE FOR LOT ADJUSTMENT RECORDED AS
DOCUMENT NUMBER , NAPA COUNTY RECORDS
APN: 058-320- 001- 000, 1 PARCEL, 7.22 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW. CBANDG. COM
ROSEVILLE
925) 866-0322
916)788-4456
FINAL MAP OF PARCEL 2
APRIL 2022
OWNER'S ACKNOWLEDGMENT
26 JOB NO. 1305-050 SHEET 2 OF 3
CITY CLERK'S CERTIFICATE
VICINITY MAP
SITE
FOR CONDOMINIUM PURPOSES
CONSISTING OF 3 SHEETS
BEING A SUBDIVISION OF PARCEL 2 AS DESCRIBED IN THAT
CERTIFICATE OF COMPLIANCE FOR LOT ADJUSTMENT RECORDED AS
DOCUMENT NUMBER , NAPA COUNTY RECORDS
APN: 058-320-001-000, 1 PARCEL, 7.22 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW. CBANDG. COM
ROSEVILLE
925) 866-0322
916)788-4456
FINAL MAP OF PARCEL 2
APRIL 2022
CITY ENGINEER' S STATEMENT
COUNTY TAX COLLECTOR AND
REDEMPTION OFFICER'S CERTIFICATE SURVEYOR' S STATEMENT
27 NAPA JUNCTION ROAD
HESS ROADPARCEL
2 LLA NAPA JUNCTION
ROAD 3 OF
3GRAPHIC
50' 400'100' 100' 200' 0' SCALE
0'JOB NO. 1305- 050
SHEET BASIS OF
BEARINGS:
REFERENCES:
NOTE:
LEGEND FORCONDOMINIUM
PURPOSES SCALE:
1" = CONSISTING OF 3
SHEETS BEING ASUBDIVISION OF PARCEL 2AS DESCRIBED IN
THAT CERTIFICATE OF COMPLIANCE FOR LOT ADJUSTMENT RECORDED
AS DOCUMENT NUMBER , NAPA COUNTY
RECORDS APN: 058-320-001- 000, 1 PARCEL, 7.22
AC +/- CITY OF AMERICAN CANYON, NAPA COUNTY
CALIFORNIA APRIL
2022 CIVIL ENGINEERS SURVEYORS
PLANNERS SAN
RAMON WWW. CBANDG.
COM
ROSEVILLE 925) 866-
0322 916)788-
4456 FINAL MAP OF PARCEL
2 100'HESS
28 RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City OF AMERICAN CANYON
4381 Broadway, Suite 201
American Canyon, California 94503
EXEMPT from recording fee pursuant to Government Code Section 27383
SUBDIVISION IMPROVEMENT AGREEMENT
This Subdivision Improvement Agreement ( this " Agreement"), is made by and between the CITY OF AMERICAN CANYON ( hereinafter " City") and R.H. HESS DEVELOPMENT COMPANY, INC. ( hereinafter " Developer"), and is effective this 3rd day of May, 2022 ( the Effective Date").
RECITALS
WHEREAS, Developer is the owner of certain real property comprised of approximately 20.8 acres on two parcels ( Parcel A and Parcel 8) and located southwest of the Napa Junction Road and Hess Road intersection in the City of American Canyon, California ( APNs 058- 380- 008 and 058-320-001), as more particularly depicted on Exhibit A attached hereto ( hereinafter the "Property"); and
WHEREAS, on September 21, 2021, the City Council approved General Plan Amendments and Rezones to re-designate Parcel A as Residential High Density, 16 dwelling units per acre ( RH-1), rezone Parcel A to Residential High Density ( RH), redesignate Parcel 8 as Residential Medium Density, 12 dwelling units per acre ( RM), and rezone Parcel 8 to Residential Medium Density ( RM), as well as approved Tentative Maps and Design Permits and certified an Initial Study/ Mitigated Negative Declaration, among other approvals ( collectively, the " Project Approvals") pursuant to Ordinance Nos. 2021- 05 and - 06 and Resolution Nos. 2021- 61, - 62, - 63, - 64, - 76, - 77, - 78, and - 79; and WHEREAS, Developer intends to construct 291 multi-family residential units and associated improvements and infrastructure ( the " Project") on the Property pursuant to the Project Approvals; and
WHEREAS, certain of the Project Approvals include several conditions of approval, including conditions related to certain required public and private improvements the " Conditions"); and
WHEREAS, City and Developer, by this Agreement, each desire to document and secure the other' s improvement and performance obligations related to the 084120\14769262v2
29 Conditions. The improvements that are the subject of this Agreement are set forth on Schedule A attached hereto ( the "Improvements").
NOW, THEREFORE, in consideration of the mutual promises contained herein, the City and Developer ( the "Parties" or each a "Party") hereby agree as follows:
AGREEMENT
1. Improvement Agreement. The following subsections of this Section 1 apply to the construction of the Improvements and constitute the requisite " Improvement Agreement" for such Improvements as contemplated by the Project Approvals:
a. Improvements. Subject to the terms and conditions of this Agreement, Developer hereby acknowledges and agrees that prior to the issuance of the first certificate of occupancy for the Project, all the Improvements described in Schedule A must be constructed in accordance with the plans and specifications accepted by City staff and in accordance with the Conditions. However, no certificate of occupancy shall be withheld if Developer is unable to complete certain of the Improvements due to the inability to obtain any required property rights ( the "Rights," as defined below) from third parties as described in subsection b. below or due to any delays due to approvals or consents by third-party agencies or for othe reasons outside of the reasonable control of Developer.
b. Right- of Way Acquisition. Developer, at its sole cost and expense, shall secure all necessary property rights, including but not limited to rights-of-way and public and private easements, for the Improvements ( collectively, the "Rights") and such Rights shall either be set forth on the Project' s final map or be granted by separate instrument.
Notwithstanding the foregoing, should Developer, after exercising its good faith efforts to acquire any such Rights, be unable to do so, then at the request of Developer, City shall exercise its power of eminent domain to acquire such Rights; provided that Developer enters first into an agreement with the City to pay for all costs incurred by the City to acquire such Rights. If the City does not acquire the Rights necessary to allow the Improvements to be completed by Developer within the statutory timeline provided by law, then Developer shall be relieved of the obligation to construct those Improvements only to the extent they require property not currently owned by Developer or the City. All necessary Rights for the Improvements to be dedicated to City shall be granted to City concurrently with the inspection and acceptance by the City of the applicable Improvement.
c. Performance of Work. Developer, at its sole expense, may engage one or more licensed general contractors and/or subcontractors ( hereinafter " Contractors") to install the Improvements and shall cause all of the Improvements to be constructed in a good and workmanlike manner. Developer shall cause all of the Improvements to be performed at the places, with the materials, in the manner, and at the grades in accordance with the plans and specifications accepted by City staff. 084120\ 14769262v2
30 d. Work: Milestone for Completion of Improvements. Except as otherwise provided in Section 1 (a) above, prior to the issuance of a certificate of occupancy, the Improvements shall be completed to the satisfaction of the City as evidenced by a notice of completion filed with the Napa County Recorder' s Office; provided, however, that the City agrees to issue certificates of occupancy for any building if the only Improvements that remain incomplete are those that are ( i) subject to an eminent domain action necessary to require the Rights, ( ii) delayed by inaction or delays caused by third- party reviewing agencies or other delays outside of the reasonable control of Developer.
Furthermore, in the event that any Improvements are not completed prior to the time that the Developer seeks City approval for a certificate of occupancy, the City shall not unreasonably withhold issuance of a certificate of occupancy. e. Time is of Essence - Extension. Time is of the essence for the completion of the Improvements provided, however, that in the event " good cause" is shown therefore, City may extend the time for commencement or completion of the Improvements so as to not unreasonably withhold a certificate of occupancy for any building in the Project.
f. Repairs and Replacements. Developer shall cause the replacement or have replaced, repair or have repaired, as the case may be, or pay to the City, the entire cost of replacements or repairs, of any and all property damaged or destroyed by reason of any work done hereunder, whether such property be owned by the United States or any agency thereof, or the State of California, or any agency or political subdivision thereof, or by the City or by any public or private corporation, partnership or association, or by any person . Any such repair or replacement shall be to the satisfaction and subject to the approval of the said City' s Engineer.
g. Permits; Compliance with Law. Developer shall cause, at its sole expense, all permits and licenses necessary for the approval and construction of the Improvements to be obtained and shall cause all necessary notices to be issued and all required fees and taxes to be paid. Such permits shall include but not be limited to City Encroachment Permit( s) if necessary. Developer shall cause the furnishment of proof of the required workers' compensation insurance coverage prior to the Contractors commencement of activities in conjunction with the Improvements. h.. Inspection by City. Developer shall at all times maintain proper facilities and provide safe access for inspection by City to all parts of the work of the Improvements, to assure that the work done shall be done in accordance with the plans and specifications accepted by City staff. Inspections by City are solely for the benefit of City. City shall not be responsible for any defective work or materials which could have been discovered by Developer through independent inspection regardless of whether or not the City undertook such inspections.
i. Securities. Prior to issuance of the first building permit for the Project, and in accordance with Government Code section 66499 et seq., Developer shall provide, or cause its Contractor to provide, improvement security for the Improvements based on the 084120\14769262v2
31 estimated costs thereof in favor of the City in an amount and form reasonably acceptable to the City.
Said security shall be prepared on the standard forms provided by City and available from City's Engineer. Also, the security may be provided separately for each Improvement as shown on Schedule A.
Irrevocable letters of credit or cash deposits or savings account( s) or certificate( s) payable to City in form reasonably satisfactory to City and equivalent to said surety bonds may be accepted by City in place ofthe bonds with all legal expenses incurred by City in reviewing and approving said bond equivalents to be paid by Developer.
Developer agrees to maintain such surety bonds and/or approved and applicable irrevocable letter(s) of credit, or cash deposit( s), or savings account( s) or other acceptable certificate( s) payable to the City in full force and effect consistent with the terms of this Agreement, including any extensions of time as may be granted by the City.
As and when various discrete components of the Improvements have been constructed and completed and have been accepted by the City pursuant to the terms and conditions of this Agreement, City agrees to issue a notice of completion and acceptance of such components of the Improvements ( individually, a "Notice of Completion") and cooperate with Developer to reduce the outstanding amount of the security to reflect the then remaining unpaid costs of the Improvements.
j. Title to Improvements. Title to, and ownership of, all Improvements constructed hereunder by Developer which are to be delivered to City or for which there is an irrevocable offer of dedication as set forth on the Project Approvals shall vest absolutely in City upon completion and acceptance of such Improvements by the City.
For the avoidance of any doubt, the City shall be deemed to have accepted any irrevocable offers of dedication upon its issuance of a certificate or notice of completion with respect to any Improvements constructed therein and thereon. k. Repair or Reconstruction of Defective Work. If, within a period of one 1) year after the notice of completion evidencing final acceptance of any work of an Improvement performed under this Agreement, any structure or part of any structure furnished and/or installed or constructed, or caused to be installed or constructed by Developer, or any of the work done under this Agreement, fails to fulfill any of the requirements of this Agreement or the specifications referred to herein, Developer shall, without delay and without any cost to City, repair or replace or reconstruct any defective or otherwise unsatisfactory part of parts of the work or structure. Should Developer fail to make, or undertake with due diligence, the aforesaid repairs within twenty ( 20) calendar days after City has given written notice of such failure or should the exigencies of the case require repairs or replacements to be made before Developer can be notified or act, City may, at its option, make the necessary repairs or replacements or perform the necessary work, and Developer shall pay to City the actual cost of such repairs. The security described in subsection i. shall be released upon expiration of such one-year period if no claim is made within such period.
084120\14769262v2
32 I. Developer Not Agent of City. Notwithstanding any other provision of this Agreement, neither Developer nor any of Developer' s agents, contractors and/or subcontractors are or shall be considered to be agents of City in connection with the performance of Developer' s obligations under this Agreement. m. Cost of Engineering and Inspection. Developer shall be responsible to pay 100% of the costs incurred by City for plan check and inspection services. Should the City elect to utilize the services of a consultant, Developer shall pay the actual and reasonable cost of the consultant' s time.
n. Notice of Breach and Default. After commencement of work of the Improvements, if Developer refuses or fails to obtain prosecution of the work, or any several parts thereof, with such diligence as will insure its completion within the time specified, or any extensions thereof, or fails to obtain completion of said work within such time, subject to extension, or if Developer should be adjudged as bankrupt, or Developer should make a general assignment for the benefit of Developer' s creditors, or if a receiver should be appointed in the event of Developer' s insolvency, or if Developer or any of Developer' s contractors, subcontractors, supplier, agents or employees, should violate any of the provisions of this Agreement, City's City Manager or City Council may serve written notice upon Developer and the applicable surety of breach of this Agreement, or any portion thereof, and default of Developer; provided, however, that Developer shall be provided a reasonable period of time within which to cure such defaults.
In the event any such notice of breach is given and surety is present, Developer' s surety shall have the duty to take over and complete the work of the Improvements after the expiration of any applicable cure period; provided, however, that if the surety, within ten ( 10) days after serving upon it such notice of breach, does not give City written notice of its intention to take over and complete the performance of the contract, and does not commence performance thereof within five ( 5) days after notice to City of such election, City may take over the work and prosecute the same to completion by contract or any other method City may deem advisable, for the account and at the expense of Developer, and Developer' s surety shall be liable to City for any costs or damages occasioned City thereby, and, in such event, City without liability for so doing, may take possession of, and utilize in completing the work, such materials, appliances, plant and other property belonging to Developer as may be on the site of the work and necessary therefor. o. Insurance. During the work of the Improvements, Developer agrees to have and require its Contractors to maintain the policies set forth in Exhibit B entitled INSURANCE REQUIREMENTS," which Exhibit is attached and incorporated by this reference. All policies, endorsements, certificates, and/or binders shall be subject to approval by the City as to form and content. These requirements are subject to amendment or waiver only if so approved in writing by the parties. A lapse in any required insurance coverage during the work of the Improvements shall be a breach of this Agreement.
Developer shall procure and maintain insurance as set forth in Exhibit B, attached and incorporated by this reference. Developer' s obligation to maintain such insurance shall 084120\14769262v2
33 commence upon the commencement of the work of any of the Improvements and shall expire upon the issuance of the last notice of completion with respect to the Improvements subject to any so-called " tail" requirements in Exhibit B).
Developer agrees to cause and maintain in force at all times during this Agreement, the provision of workers' compensation insurance as required by law.
Developer agrees to include with all subcontractors in their subcontract the same requirements and provisions of this Agreement including the indemnity and insurance requirements to the extent they apply to the scope of the subcontractor' s work.
Subcontractors hired by Developer agree to be bound to Developer and City in the same manner and to the same extent as Developer is bound to City under this Agreement and any other applicable contract documents. Subcontractor further agrees to include these same provisions with any sub- subcontractor. A copy of the indemnity and insurance provisions in this Agreement will be furnished to the subcontractor upon request.
Developer shall require all subcontractors to provide a valid certificate of insurance and the required endorsements included in the Agreement prior to commencement of any work and will provide proof of compliance to the City.
The policy or policies required by this Agreement shall be issued by an insurer admitted in the State of California.
Developer agrees that if the aforesaid insurance is not kept in full force and effect, City may terminate this Agreement upon ten ( 10) days prior notice to Developer, unless Developer delivers evidence of insurance to City within such ten ( 10) day period.
At all times during the term of this Agreement, Developer shall be required to maintain on file with the City a certificate or certificates of the required insurance as set forth in Exhibit B showing that the required insurance policies are in effect in the required amounts.
It shall be a requirement under this Agreement that any available insurance proceeds broader than or in excess of the specified minimum insurance coverage requirements and/or limits shall be available to the additional insured. Furthermore, the requirements for coverage and limits shall be the greater of (1) the minimum coverage and limits specified in this Agreement, or (2) the broader coverage and maximum limits of coverage of an insurance policy or proceeds available to the named insured.
Developer shall name the City as an additional insured as required in Exhibit B. p. Notice of Condition of Property. Developer will at all times from the effective date of this Agreement to the completion and acceptance of said work of Improvement by the City, give good and adequate warning of each and every dangerous condition caused by the construction of said Improvement and will protect the traveling public therefrom.
084120\ 14769262v2
34 q. Right of Entry. The City, its officers, agents and employees and the surety of any bond shall have the right from and after date hereof to enter upon the Property and any Rights where the Improvements are located for purposes of inspection and investigation of same at any and all reasonable times.
r. Expiration of this Section 1. Upon expiration of the one ( 1) year period described in subsection k. above ( or if a warranty claim has been made within such period, upon full and final resolution of such claim), City at Developer' s request shall confirm the termination of this Agreement as it relates to this Section 1 and execute such recordable instruments as may be reasonably requested by Developer to evidence such termination.
2. Reimbursement Agreement. Developer and City have entered into a that certain Fee Credit/ Fee Reimbursement Agreement, dated as of even date herewith. The provisions of the Fee Credit/ Fee Reimbursement Agreement shall continue to apply to the Creditable Improvements ( as defined therein), as indicated in Schedule A to this Agreement.
3. Indemnification of City. Subject to the final sentence of this Section 3, Developer, by execution of this Agreement, specifically agrees to assume the defense of, indemnify and hold harmless City and its elected representatives, officers, employees, agents, consultants, and volunteers ( the " Indemnitees"), from and against all liabilities, actions, damages, claims, losses, or expenses of every type and description, including attorneys' and consultants' fees and expenses ( collectively, " Liabilities"), to which they may be subjected or put, by reason of or resulting from the design, construction, or installation of the Improvements, except to the extent the Liabilities arise from the sole negligence, active negligence, or willful misconduct of City and/or the Indemnitees. This indemnification shall extend to Liabilities occurring after this Agreement is terminated as well as while it is in force. Notwithstanding the foregoing, following the acceptance of the Improvements by City , or if there is an applicable warranty, following the end of any applicable warranty period, the Developer shall not be obligated to indemnify the Indemnitees for Liabilities to the extent that such Liabilities arise from Indemnitees' active or passive negligence .
4. Transfer and Assignments. Developer shall have the full right to assign this Agreement, in connection with any sale, transfer or conveyance of the Property or portion thereof. Upon the express written assumption by the assignee of such assignment and the conveyances of Developer' s interest in the Property related thereto, Developer shall be released from any further liability or obligation hereunder related to the portion of the Property so conveyed. If the transferred Property consists of a less than the entire Property, or less than Developer' s entire title to or interest in the Property, Developer shall have the right to transfer, sell and/or assign to the transferee only those of Developer' s rights and obligations under this Agreement that are allocable or attributable to the transferred Property. Any transferee shall assume in writing the obligations of Developer under this Agreement arising or accruing from and after the effective date of such transfer, sale, or assignment. Developer shall provide City with written notice of any assignment 084120\14769262v2
35 or transfer of this Agreement no later than thirty ( 30) days after such assignment or transfer.
5. Attorneys' Fees. In case suit is brought on this Agreement, each Party agrees to pay its own costs and expenses and fees incurred in enforcing any obligations or rights created by this Agreement, including attorneys' fees.
6. Notices. Any notice, payment, or instrument required or permitted by this Agreement to either party shall be deemed to have been received when personally delivered to that party or seventy- two ( 72) hours following deposit of the same in any United States Post Office, first class, postage prepaid , addressed as follows.
City of American Canyon
Attention: City Manager
4381 Broadway, Suite 201
American Canyon, California 94503
And with copies to:
William D. Ross, Esq.
address]
Notices required to be given to Developer shall be addressed as follows:
R.H. Hess Development Company, Inc .
3423 Broadway Street, Suite 0-5
American Canyon, CA 94503
Attn: Richard Hess
And with copies to:
Clark Morrison, Esq.
Cox, Castle & Nicholson LLP
50 California Street, Suite 3200
San Francisco, CA 94111
Notices required to be given any surety shall be addressed to its address shown on its bond; provided, that any party or the surety may change such address by notice in writing to the other party, and thereafter notices shall be addressed and transmitted to the new address.
7. Ordinances. Rules and Regulations. Developer shall at all times be bound by and abide by all of City's ordinances, rules and regulations now in effect or hereinafter amended or enacted as applicable to the Improvements. This Agreement shall prevail over the terms and conditions of any such ordinances, rules and regulations if there is any conflict between such ordinances, rules and regulations and this Agreement.
084120\ 14769262v2
36 8. Binding Form of Agreement. It is agreed by and between the Parties to this Agreement that the Agreement firmly binds the Parties, their heirs, executors, administrators, successors or assignees, jointly and severally. Upon expiration of the one (1) year period described in Section 1.k. (or if a warranty claim has been made within such period, upon full and final resolution of such claim), City at Developer' s request shall confirm the termination of this Agreement as it relates to Section 1 and execute such recordable instruments as may be reasonably requested by Developer to evidence such termination.
9. Governing Law and Venue. This Agreement and the rights and obligations of the Parties hereto shall be construed and enforced in accordance with and governed by the laws of the State of California. The venue for any legal action in state court filed by a Party to this Agreement for the purpose of interpreting or enforcing any provision of this Agreement shall be in the Superior Court of California, County of Napa.
The venue for any legal action in federal court filed by a Party to this Agreement for the purpose of interpreting or enforcing any provision of this Agreement within the jurisdiction of the Federal courts shall be the Northern District of California. The appropriate venue for arbitration, mediation or similar legal proceeding under this Agreement shall be in Napa County, California; however, nothing in this Agreement section shall obligate a Party to submit to arbitration any dispute arising under this Agreement.
10. No Waiver. Any waiver at any time by any Party hereto of its rights with respect to a default or any other matter arising in connection with this Agreement shall not be deemed to be a waiver with respect to any other default or matter.
11. Severabilitv. In the event anyone or more of the provisions of this Agreement shall for any reason be held to be invalid, illegal or unenforceable, in whole or in part or in any other respect, then such provision or provisions only shall be deemed null and void and shall not affect the validity of this Agreement, and the remaining provisions of this Agreement shall remain operative and in full force and effect and shall in no way be affected, prejudiced or disturbed thereby.
12. Counterparts. This Agreement may be executed in any number of counterparts, each of which so executed shall be deemed an original, but all of which when taken together shall constitute but one Agreement.
Agreement continued on next page]
084120\)4769262v2
37 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.
City"
City of American Canyon
By:
City Manager
ATTEST:
By:
Deputy City Clerk
APPROVED AS TO FORM:
By :
William D. Ross
City Attorney
084120\1 4769262v2
Developer"
R.H. Hess Development Company, Inc.
By: ____________ _
Name : ___________ _
Title: ___________ _
38 EXHIBIT A
LEGAL DESCRIPTION OF PROPERY
084120\14769262v2
39 EXHIBIT B
INSURANCE REQUIREMENTS
Please refer to the insurance requirements listed below. Those that have an " X" indicated in the space before the requirement apply.
Developer shall procure and maintain for the duration of the Agreement as it relates to the construction of the Improvements insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder and the results of that work by the Developer, its agents, representatives, employees or subcontractors.
Developer shall provide its insurance broker( s)/agent( s) with a copy of these requirements and request that they provide Certificates of Insurance complete with copies of all required endorsements.
Developer shall furnish City with copies of original endorsements affecting coverage required by this Exhibit B. The endorsements are to be Signed by a person authorized by that insurer to bind coverage on its behalf. All endorsements and certificates are to be received and approved by City before work commences. City has the right to require Developer' s insurer to provide complete, certified copies of all required insurance policies, including endorsements affecting the coverage required by these specifications.
Commercial General Liability ( CGL):
Coverage at least as broad as Insurance Services Office (" ISO") Form CG 00 01 covering CGL on an " occurrence" basis, including products and completed operations, property damage, bodily injury and personal and advertising injury with limits no less than $ 2,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/ location or the general aggregate limit shall be twice the required occurrence limit.
Coverage at least as broad as ISO Form CG 00 01 covering CGL on an " occurrence" basis, including products and completed operations, property damage, bodily injury and personal and advertising injury with limits no less than $ 1,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/ location or the general aggregate limit shall be twice the required occurrence limit.
Coverage at least as broad as ISO Form CG 00 01 covering CGL on an " occurrence" basis, including products and completed operations, property damage, bodily injury and personal and advertising injury with limits no less than $ 5,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/ location or the general aggregate limit shall be twice the required occurrence limit.
084120\ 14769262v2
40 Automobile Liability:
Coverage at least as broad as ISO Form Number CA 0001 covering, Code 1 (any auto), or if Developer has no owned autos, Code 8 (hired) and 9 (non-owned), with limits no less than $ 1,000,000 per accident for bodily injury and property damage.
Coverage at least as broad as ISO Form Number CA 0001 covering, Code 1 (any auto), with limits no less than $ 5,000,000 per accident for bodily injury and property damage.
Garage keepers' extra liability endorsement to extend coverage to all vehicles in the care, custody and control of the Developer, regardless of where the vehicles are kept or driven.
Professional Liability (Errors and Omissions):
The Employer' s Liability policy shall be endorsed to waive any right of subrogation as respects the City, its elected and appointed officials, officers, attorneys, agents, and employees.
Insurance appropriate to the Developer or Developer' s Consultant profession, with limit no less than $ 1,000,000 per occurrence or claim, $ 2,000,000 aggregate If Design/ Build), with limits no less than $ 1,000,000 per occurrence or claim, and 2,000,000 policy aggregate.
Insurance appropriate to the Developer or Developer' s Consultant profession, with limit no less than per occurrence or claim, aggregate
Workers' Compensation Insurance:
Insurance as required by the State of California, with Statutory Limits, and Employer' s Liability Insurance with limit of no less than $ 1,000,000 per accident for bodily injury or disease. ( Not required ifDeveloper provides written verification it has no employees)
084120\14769262v2
41 The Developer ( or its Contractors) makes the following certification, required by Section 1861 of the California Labor Code:
I am aware of the provisions of Section 3700 of the Labor Code which require every employer to be insured against liability for workers' compensation or to undertake selfinsurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of this contract.
Developer ( or Contractor) Signature
Builder' s Risk ( Course of Construction):
Insurance utilizing an " All Risk" ( Special Perils) coverage form, with limits equal to the completed value of the project and no coinsurance penalty provisions.
Surety Bonds:
Contractor shall provide the following Surety Bonds or Irrevocable letters of credit or cash deposits or savings account( s) or certificate( s) payable to City:
1. Performance Bond
2. Payment Bond
3. Maintenance Bond
The Payment Bond and Performance Bond shall be in a sum equal to the contract price.
If the Performance Bond provides for a one- year warranty a separate Maintenance Bond is not necessary. If the warranty period specified in the contracts is for longer than one 1) year a Maintenance Bond equal to ten percent ( 10%) of the contract price is required.
Bonds shall be duly executed by a responsible corporate surety, authorized to issue such bonds in the State of California and secured through an authorized agent with an office in California.
Developer' s Pollution Legal Liability:
Developer' s pollution legal liability and/or Asbestos Legal Liability and/or Errors and Omissions ( if project involves environmental hazards) with limits no less than 1,000,000 per occurrence or claim and $ 2,000,000 policy aggregate.
If the Developer maintains higher limits than the minimums shown above, the City requires and shall be entitled to coverage for the higher limits maintained by the Developer. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to City.
Other Insurance Provisions:
084120\ 14769262v2
42 The insurance policies are to contain, or be endorsed to contain the following provisions:
Additional Insured Status:
The insurance policies are to contain, or be endorsed to contain the following provision:
The City, its elected and appointed officials, officers, attorneys, agents, and employees are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of the Developer or Consultant or any Subcontractors including materials, parts, or equipment furnished in connection with such work or operations, including completed operations. General liability coverage can be provided in the form of an endorsement to the Developer' s or Consultant' s insurance ( at least as broad as ISO Form CG 20 10 11 85 or if not available, through the addition of both CG 20 10 and CG 20 37 if a later edition is used).
The Additional Insured coverage under the Contractor' s policy shall be " primary and noncontributory" and will not seek contribution from the City' s insurance or self-insurance and shall be at least as broad as CG 20 01 04 13.
The limits of insurance required in this Agreement may be satisfied by a combination of primary and umbrella or excess insurance. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and non- contributory basis for the benefit of City ( if agreed to in a written contract or agreement) before the City' s own insurance or self-insurance shall be called upon to protect it as a named insured.
Primary Coverage:
The insurance policies are to contain, or be endorsed to contain the following provision:
For any claims related to this contract, the Developer' s insurance coverage shall be primary insurance as respects the City, its elected and appointed officials, officers, attorneys, agents, and employees. Any insurance or self-insurance maintained by the City its elected and appointed officials, officers, attorneys, agents, and employees shall be in excess of the Developer' s insurance and shall not contribute with it.
Notice ofCancellation, Suspension or Otherwise Voiding Policies:
Each insurance policy required above shall contain, or be endorsed to contain that 084120114769262v2
43 coverage shall not be suspended, voided, canceled or reduced in coverage or in limits except with thirty ( 30) days' prior written notice by certified mail, return receip t requested to the City.
Waiver of Subrogation:
Developer hereby grants to City a waiver of any right to subrogation which any insurer of said Developer may acquire against the City by virtue of the payment of any loss under such insurance. Developer agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of sub(ogation endorsement from the insurer. The Workers' Compensation Policy shall be endorsed with a waiver of subrogation in favor of the City for all work performed by Developer or Contractor, its employees, agents and subcontractors.
Deductibles and Self-Insured Retentions ( IlSIR'?:
Any deductibles or self-insured retentions must be declared to an approved by City. The City may require the Developer to purchase coverage with a lower deductible or retention or provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention. At the option of the City, either (1) the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its elected and appointed officials, officers, attorneys, agents, and employees; or (2) the Developer shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses.
All SIRs must be disclosed to Risk Management for approval and shall not reduce the limits of liability.
Policies containing any SIR provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named insured or the City.
City reserves the right to obtain a full-certified copy of any insurance policy and endorsements. Failure to exercise this right shall not constitute a waiver of right to exercise later.
Completed Operations
For Construction Agreements, Contractor shall maintain insurance as required by this Agreement to the fullest amount allowed by law and shall maintain insurance for a minimum of five (5) years following the completion of this project. In the event Contractor fails to obtain or maintain completed operations coverage as required by this Agreement, the City at its sole discretion may purchase the coverage required and the cost will be paid by Contractor.
Acceptability of Insurers:
084120\ 147 69262v2
44 Insurance is to be placed with insurers with a current A.M. Best' s rating of no less than A: VII , unless otherwise acceptable to City.
Claims Made Policies: ( note - should be applicable only to professional liability, see below)
1. The Retroactive Date must be shown, and must be before the date of the contract or the beginning of contract work .
2. Insurance must be maintained and evidence of insurance must be provided for at least five ( 5) years after completion of contract of work.
3. If coverage is canceled or non-renewed, and not replaced with another claims- made policy form with a Retroactive Date prior to the contract effective date, the Developer must purchase " extended reporting" coverage for a minimum of five ( 5) years after completion of work.
4. A copy of the claims reporting requirements must be submitted to the City for review.
5. If the services involve lead- based paint or asbestos identificationlremediation, the Contractor' s Pollution Liability Policy shall not contain lead- based paint or asbestos exclusions. If the services involve mold identification/ remediation, the Contractors Pollution Liability Policy shall not contain a mold exclusion, and the definition of Pollution shall include microbial matter, including mold.
Subcontractors:
Contractor shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein, and Contractor shall ensure that City is an additional insured on insurance required from subcontractors.
Subcontractor agrees to be bound to Contractor and City in the same manner and to the same extent as Contractor is bound to City under this Agreement and any other contract documents. Subcontractor further agrees to include the same requirements and provisions of this Agreement, including the indemnity and insurance requirements, with any sub- subcontractor to the extent they apply to the scope of the sub- subcontractor' s work. A copy of the City indemnity and insurance provisions will be furnished to the subcontractor upon request.
Verification of Coverage:
Developer shall furnish the City with original certificates and amendatory endorsements or copies of the applicable policy language effecting coverage required by this clause. All 084120\14769262v2
45 certificates and endorsements are to be received and approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive the Developer' s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.
Special Risks or Circumstances
City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage or other special circumstances.
Failure to Comply:
Each insurance policy required above shall contain or be endorsed to contain that any failure to comply with reporting provisions of the policies shall not affect coverage provided to the City, its elected and appointed officials, officers, attorneys, agents, and employees.
Applicability of Coverage:
Each insurance policy required above shall contain or be endorsed to contain that the Developer' s insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer' s liability. 084120\ 14769262v2
46 Oat Hill Multi-Family Residential Project
City ofAmerican Canyon
Schedule A: Improvements
IMPROVEMENT REIMBURSEMENT
NaI! a Junction Road ImI! rovements:
Subject to Fee CreditlFee •
Construct an approximately 300-foot segment of Reimbursement Agreement Napa Junction Road between the Hess RoadlNapa
Junction Road intersection and the existing
roadway fronting Napa Junction Magnet
Elementary School. The preliminary roadway
shall have a curb -to-curb with of 40- feet with 5-
foot wide ( includes curb width) attached sidewalks
on both sides. The final roadway section shall be
as determined by the City Engineer. The extent of
the roadway construction may be extended as
necessary to meet City roadway geometric
standards.
Construct a new 5-foot wide ( includes curb width)
attached sidewalk along the south side ofNapa
Junction Road between the east end of the new
road segment described above to the existing
sidewalk approximately 100- feet west of Theresa
Avenue.
Construct a new 5-foot wide attached sidewalk
along the south side ofNapa Junction Road
between the Hess Road intersection and the
western limit of Parcel A.
Water Main ReI!lacement in NaI!a Junction Road : Subject to Fee Credit/Fee Replace approximately 590 linear feet of the
Reimbursement Agreement
existing 6-inch water main in Napa Junction Road
with a new 12-inch water main between the
intersection with Theresa Avenue to the
intersection with Hess Road, connecting to the
existing water mains in those intersections.
Sanitru: y Sewer Main ReI! lacement in NaI! a Junction Road Subject to Fee Credit/ Fee and Theresa Avenue: Reimbursement Agreement
Replace approximately 1,800 linear feet ofthe
existing 6-inch sanitary sewer mains in Napa
Junction Road between Hess Road and Theresa
Avenue and in Theresa Avenue from Napa
08412011 4769262v2
47 IMPROVEMENT REIMBURSEMENT
Junction Road to a point approximately 1,200
linear feet south thereof with new 8-inch and 10-
inch sanitary sewer mains. The Engineer of
Record shall conduct a capacity analysis for the
new sanitary sewers to determine where it should
upsize from 8-inch to 10-inch.
Recycled Water Main in Lombard Road and Hess Road: Subject to Fee Credit/Fee Install approximately 1,300 linear feet ofa new 8-
Reimbursement Agreement
inch recycled water main in Lombard Road
between the cul-de-sac at its northern terminus
and Hess Drive and in Hess Drive between
Lombard Road and the Little League fields.
Water Main in NaQa Junction Road Subject to Fee Credit/Fee Install approximately 1,310 linear feet of 12-inch
Reimbursement Agreement
water main in Napa Junction Road from the
intersection ofHess Road to the Oat Hill Tank #2,
connecting to the existing 12-inch water mains.
Fire Flow Demand:
Install public water system improvements
sufficient to meet the domestic and fire flow
demands ofthe project by upgrading the City's
existing Oat Hill Pump Station that feeds Oat Hill
Tank #2 from Oat Hill Tank #1.
Storm Drain Facilities:
Construct private on-site drainage facilities,
detention facilities, and other appurtenances to
collect and convey all surface drainage to an
approved private storm drain facility or outfall.
Onsite drainage facilities shall provide for the
positive drainage ofall adjacent upstream or
upgrade properties to prevent ponding. Existing
run-on from adjacent properties shall not be
obstructed and shall be conveyed onsite. Off-site
peak storm water discharge shall not exceed 90%
ofthe undeveloped peak flow from the 24-hour,
100-year event. The storm drains and detention
facilities shall be substantially consistent with the
Preliminary Plans. However, the sizing ofall
084120\14769262v2
48 IMPROVEMENT REIMBURSEMENT
stonn drains and detention facilities shall be
determined by the approved final drainage report.
Stonnwater Quality Facilities:
Pennanent on-site private post-construction
stonnwater treatment BMPs shall be designed and
constructed in accordance with the approved final
Stonnwater Control Plan (SWCP). Runoff from
all roofdrains shall be conveyed to the onsite
stonnwater treatment facilities.
Emergency Vehicle Access Road
Construct a 20-foot wide paved vehicle road on
Oat Hill Parcel A and across Oat Hill Parcel B
connecting to Napa Junction Road .
084120\14769262v2
49 CITY OF AMERICAN CANYON
FEE CREDI T / FEE REIMBURSEMENT AGREEMENT
FOR WATER, SEWER, AND ROAD INFRASTRUCTURE
IMPROVEMENTS
R.H. HESS DEVELOPMENT COMPANY
OAT HILL MULTI-FAMILY PROJECT
This Fee Credit / Fee Reimbursement Agreement (the " Agreement") is entered into as of the 3rd day ofMay, 2022, by and between the City ofAmerican Canyon, a municipal corporation (the " City"), and R.H. Hess Development Company, Inc. (" Developer").
RECITALS
WHEREAS, Developer is the owner ofcertain real property comprised ofapproximately
20.8 acres on two parcels (Parcel A and Parcel B) and located southwest ofthe Napa Junction Road and Hess Road intersection in the City ofAmerican Canyon, California (APNs 058-380- 008 and 058-320-001), as shown in Exhibit A;
WHEREAS, on August 17, 2020, Developer submitted entitlement applications for the development of291 residential units and associated amenities on Parcels A and B (the Project");
WHEREAS, on September 21,2021, the City adopted Ordinance Nos. 2021-05 and -06, approving a General Plan Amendment and Rezone to re-designate Parcel A as Residential High Density, 16 dwelling units per acre ( RH-l), rezone Parcel A to Residential High Density (RH), re-designate Parcel B as Residential Medium Density, 12 dwelling units per acre (RM), and rezone Parcel B to Residential Medium Density (RM). On that date , the City also adopted Resolution Nos. 2021-61, -62, -63 , -64, -76, -77, -78, and -79, approving Tentative Maps and Design Permits for the Project and certifying an Initial Study/Mitigated Negative Declaration for the Project, among other approvals;
WHEREAS, City Municipal Code section 13.06.110 authorizes the City to enter into fee credit and fee reimbursement agreements for the construction ofoff-site or oversized improvements to the City 's water or sewer system;
WHEREAS, Resolution Nos. 2021-76, -77 , -78 , and -79 , approving Tentative Maps and Design Permits for the Project, provide that certain other water and road infrastructure improvements constructed by Developer qualify for fee credits and fee reimbursement for the costs ofsuch improvements ;
WHEREAS, Developer proposes to construct certain eligible water, sewer, recycled water, and road improvements as part ofthe Project that would otherwise be financed by City fees and rates and built by the City; and
WHEREAS, this Agreement provides for the allocation ofcertain fee credits and fee reimbursement for the costs ofsuch improvements.
1 0841 20\ 12321709vS
50 NOW, THEREFORE, in consideration ofthe mutual promises contained herein, the City and Developer hereby agree as follows:
AGREEMENT
Section 1 Construction ofFacilities
1.1 Prior to the issuance ofthe first certificate ofoccupancy for the Project, subject to the requirements ofthe Subdivision Improvement Agreement and except as provided therein, Developer will construct the improvement projects depicted in Exhibit B and listed in Exhibit C and identified in Conditions ofApproval (" COA") provided in Resolution Nos. 2021-76 (COA No. 76), - 77 (COA No. 73), - 78 ( COA No. 75), and -79 (COA No. 74), approving Tentative Maps and Design Permits for the Project (the " Creditable Improvements").
1.2 Developer shall cause the construction ofthe Creditable Improvements in accordance with the Subdivision Improvement Agreement.
1.3. In consideration ofDeveloper constructing the Creditable Improvements, the City agrees to provide fee credits and fee reimbursement to Developer subject to the terms ofthis Agreement.
Section 2 Permits, Process, and Procedures
2.1 Developer shall be responsible for obtaining all necessary permits for construction ofthe Creditable Improvements, provided the City shall use its best efforts to expedite plan and permitting review associated with the Creditable Improvements and the Project.
2.2 The Developer shall be responsible for complying with all applicable laws, codes, and regulations relating to contracting and construction procedures for publicly-funded public works projects, including, but not limited to, competitively bidding the construction work and paying prevailing wages , to the extent such requirements apply.
Section 3 Fee Credits for the Costs ofthe Creditable Improvements
3.1 In consideration ofDeveloper' s construction ofthe Creditable Improvements , the City shall credit the Developer for all amounts spent, or authorized to be spent, in connection with the planning, financing , acquisition, and development ofthe Creditable Improvements, based upon the Actual Costs thereof, as approved by the City Engineer (the " Fee Credits").
Actual Costs" means all ofthe costs incurred by the Developer to construct the Creditable Improvements. Actual Costs shall consist ofthe costs of (i) construction ofthe Creditable Improvements, based on the price included in any construction contract or reasonable change orders for the construction ofthe Creditable Improvements and ( ii) traffic control, staging and storm water pollution prevention implementation measures ( i.e., structural BMPs) related to such construction, plus (iii) an allowance for Soft Costs associated with construction. " Soft Costs" shall include, without limitation, costs associated with storm water pollution prevention monitoring and management (i.e., non-structural BMPs) and engineering, design, environmental , permitting, inspection, testing , surveying, and bonding related to the construction ofthe 2 084120\ 12321709v5
51 Creditable Improvements. In no event shall Soft Costs exceed the amount of25 percent ofthe Actual Costs. Developer must provide contracts, invoices and any other form ofdocumentation to substantiate the Actual Costs. However, in consideration ofthe foregoing 25 percent allowance for Soft Costs based on the Actual Costs, Developer shall not be obligated to provide contracts, invoices or any other form ofdocumentation to substantiate the actual amount ofSoft Costs incurred, nor shall Developer be allowed to request a greater amount due to actual Soft Costs exceeding this fixed-percentage allowance.
For construction change orders to be given consideration for Fee Credit or Fee Reimbursement, the Developer must:
Present the change order request to the extent the change order is in excess of5% ofthe aggregate Estimated Costs and estimated cost along with supporting information to the City; and
Fully document any work performed under a change order to verify all associated costs.
Failure to comply with any ofthese procedures may result in the ineligibility ofthe requested change order for Fee CreditIFee Reimbursement.
3.2 The Fee Credits shall be available upon full execution ofthis Agreement. City and Developer acknowledge that the Actual Costs are unknown at the time ofexecution ofthis Agreement. Accordingly, the Fee Credits or Fee Reimbursements available shall be based on the Estimated Costs ofthe planning, financing, and development ofthe Creditable Improvements, which will be determined by the City Engineer and Developer prior to the issuance ofbuilding permits (the " Estimated Costs"). The City Engineer and Developer will reasonably determine the Estimated Costs for the following improvements:
Napa Junction Road Improvements;
Water Main Replacement in Napa Junction Road;
Sanitary Sewer Main Replacement in Napa Junction Road and Theresa Avenue; Recycled Water Main in Lombard Road and Hess Road; and
Water Main Extension.
3.3 The Fee Credits shall apply to the following City fees charged by the City. When and as fees are imposed for each building permit, the Developer may use a portion ofthe Fee Credit, on a dollar for dollar basis, against the fees charged. Usage ofFee Credits by Developer for each building permit shall serve to reduce the total Fee Credit in an equivalent amount to the amount ofcredit used.
Napa Junction Road Improvements shall apply to the City's Traffic Impact Fee; Water Main Replacement in Napa Junction Road shall apply to the City's Water Capacity Fee;
Sanitary Sewer Main Replacement in Napa Junction Road and Theresa Avenue shall apply to the City's Wastewater Capacity Fee;
3 084120\12321709v5
52 Recycled Water Main in Lombard Road and Hess Road shall be assumed to provide a sufficient potable water demand offset to comply with the City's Zero Water Footprint policy such that the Project shall not be required to pay any Zero Water Footprint fees; and
Water Main Extension shall apply to the City's Water Capacity Fee.
3.4 City and Developer acknowledge that the Actual Costs may vary from the Estimated Costs. Any variation in costs shall be agreed to and/or resolved by the parties as provided in Section 6 below.
Section 4 Fee Reimbursements
4.1 Notwithstanding Section 3, above, the amount ofFee Credits granted to Developer pursuant to this Agreement shall not exceed the amount ofCity fees due from the Developer as a result ofthe Project. Ifthe amount ofthe Fee Credit from Section 3 exceeds the fee obligation ofthe Developer for the Project, the remaining balance shall be paid as a reimbursement to Developer pursuant to the procedures set forth herein (the " Fee Reimbursement").
4.2 The Fee Reimbursement, ifany, shall be paid by the City as fee and rate revenues are collected within the City. After completion ofthe Creditable Improvements, such payments shall be made by the City at least quarterly throughout the year as funds become available.
Developer shall have first priority for reimbursement over any reimbursement obligations promised, agreed to, and/or approved by the City after the Effective Date ofthis Agreement.
4.3 The Fee Reimbursement shall accrue interest thereon at the rate offour percent 4%) per annum, commencing as ofthe Effective Date ofthis Agreement and continuing until the Fee Reimbursement is paid in full or until the Fee Reimbursement reverts to a Fee Credit as described in Section 4.4, below.
4.4 If, after five (5) years, the City has not paid the full amount ofthe Fee Reimbursement due to Developer, the balance shall revert to a Fee Credit, which Developer may use on any property in the City or transfer to other owners, builders, or developers, as set forth in Section 8, below.
4.5 This Section 4 shall not apply to the Recycled Water Main in Lombard Road and Hess Road Creditable Improvement project which, upon completion, shall be assumed to provide a sufficient potable water demand offset to comply with the City's Zero Water Footprint policy such that the Project shall not be required to pay any Zero Water Footprint fees.
Section 5 Annual Adjustments to Fee Credits and Fee Reimbursements
5.1 On each annual anniversary date ofthe Effective Date, the amount ofthe Fee Credit granted to Developer hereunder, and the amount ofthe Fee Reimbursement owed to Developer hereunder, ifany, shall be adjusted, up or down, by the annual change in the Engineering News Record Construction Cost Index or comparable index (the " CCI"), provided 4 084120\12321709v5
53 any such downward adjustment shall not go below the Actual Cost ofthe Creditable Improvements, as approved by the City.
5.2 This Section 5 shall not apply to the Recycled Water Main in Lombard Road and Hess Road Creditable Improvement project which, upon completion, shall be assumed to provide a sufficient potable water demand offset to comply with the City's Zero Water Footprint policy such that the Project shall not be required to pay any Zero Water Footprint fees.
Section 6 " True Up" ofFee Credits
6.1 Upon completion ofthe Creditable Improvements , the final determination ofthe Actual Costs upon with the Fee Credit/Fee Reimbursement amounts are based shall be determined by the City Engineer, based on documentation thereof provided by Developer.
6.2 In order to secure final Fee Credit and/or commitment for Fee Reimbursement, Developer shall provide the following items to the City Engineer upon completion ofthe Creditable Improvements in order for the City to determine the Actual Costs incurred by Developer for the Creditable Improvements:
a) Copies ofthe original construction contracts and any change orders that have been agreed to by the Developer, contractor, and the City. The portion ofeach change order associated with the Creditable Improvements must be itemized separately; b) Copies ofall invoices and certified payroll records, with unconditional lien releases, submitted by the contractor;
c) Copies ofall checks issued by the Developer with related invoices indicated; and d) A summary tabulation ofall contractor invoices and Developer payments.
6.3 Ifthe Actual Costs for the Creditable Improvements exceeds the Estimated Costs on which the Fee Credits are based, the difference will be treated as additional Fee Reimbursement amounts, due and payable as described in Section 4, above.
6.4 Ifthe Actual Costs ofthe Creditable Improvements are less than the Estimated Costs on which the Fee Credits are based, the difference will first be used to reduce the amount ofany Fee Reimbursement and then to relinquish the amount ofany unused Fee Credits. Ifand to the extent any Fee Credits have been used in excess ofthe Actual Costs, Developer, or Developer's assigns, shall repay such excess in cash, within thirty (30) calendar days ofreceipt ofnotice from the City ofthe amount to be repaid.
6.5 This Section 6 shall not apply to the Recycled Water Main in Lombard Road and Hess Road Creditable Improvement project which, upon completion, shall be assumed to provide a sufficient potable water demand offset to comply with the City's Zero Water Footprint policy such that the Project shall not be required to pay any Zero Water Footprint fees.
Section 7 Application ofFee Credits
7.1 Fee Credits provided pursuant to this Agreement are personal to the owner ofthe Project but are not limited to the Project. Fee Credits may be applied by the owner ofthe Project to any property located in the City, upon notice from the Developer, in accordance with the form 5 084120\12321709v5
54 attached hereto as Exhibit D. Such Fee Credits shall apply to the same type ofCity fees identified in Section 3.3.
7.2 This Section 7 shall not apply to the Recycled Water Main in Lombard Road and Hess Road Creditable Improvement project which , upon completion, shall be assumed to provide a sufficient potable water demand offset to comply with the City'S Zero Water Footprint policy such that the Project shall not be required to pay any Zero Water Footprint fees. The Recycled Water Main in Lombard Road and Hess Road Creditable Improvement project is limited to the Project.
Section 8 Transfer ofFee Credits and Fee Reimbursements
8.1 Fee Credits and Fee Reimbursements granted to Developer pursuant to this Agreement may be transferred to other owners, builders, or developers. To effect such a transfer, Developer shall submit a completed form to the City Engineer in substantially the same format as set forth in Exhibit E that will (i) reference this Agreement; ( ii) identify the Developer and assignee ifFee Credits or Fee Reimbursements are being assigned to a builder or other party; and iii) identify the Fee Credit or Fee Reimbursement balance before and after the transfer. The form must be signed by the Developer, its Assignee, and the City Engineer, and an executed copy ofthe form shall be kept on file. Section 4.4, above, shall apply to any Fee Reimbursements transferred pursuant to this section.
Section 9 Inspection and Completion
9.1 City shall, at all times, upon reasonable advance notice, have reasonable access to the construction site during construction ofthe Creditable Improvements, and Developer shall furnish City with all reasonable information necessary for ascertaining full knowledge ofthe Creditable Improvements with respect to the progress, workmanship, and character ofmaterials and equipment used and employed in the work.
9.2 Whenever the contractors retained by Developer vary the normal period during which work or any portion ofit is carried out on each day, Developer shall give timely notice to the City so that the City's representative may , ifhe or she wishes, be present to observe the work in progress. Developer shall give timely notice to the City in advance ofbackfilling or otherwise covering any part ofthe work so that the City's representative may, ifhe or she wishes, observe the work before it is concealed.
9.3 Observation ofthe work by the City shall not relieve Developer ofany ofits obligations to complete construction in accordance with the plans and specifications approved by the City Engineer.
9.4 At such time as the Developer believes a Creditable Improvement is complete, the Developer shall provide written notice ofcompletion to the City, requesting an inspection.
Within ten (10) business days following the date ofreceipt ofthe Developer's written notice of completion, the City shall conduct a final inspection ofthe Creditable Improvements. If, during the final inspection, the City determines that the Creditable Improvements have not been completed in accordance with all applicable codes, regulations, permits and approved plans, the 6 084120 \12321709v5
55 City shall prepare a punch list ofall items to be completed by the Developer and shall provide such punch list to the Developer within five (5) business days following the final inspection, or as soon as practical thereafter. Ifthe City delivers such punch list to the Developer, then the Developer shall undertake to repair such punch list items in a diligent manner within sixty (60) calendar days. Upon completion ofthe punch list work, the Developer shall request another final inspection from the City and within five (5) business days following such written notice from the Developer, the City shall conduct another final inspection. Ifthe City determines that the punch list work is complete and no other deficiencies are identified, the Developer will be deemed to have successfully completed the final inspection. Ifthe City determines that the punch list work is not complete, then City and Developer shall repeat the inspection/punch list procedures specified in this Section 9.4 until the successful completion ofthe punch list work and a final inspection. At such time as Developer has successfully completed the final inspection, City shall take all actions necessary to accept the completed Creditable Improvements within thirty (30) calendar days, or as soon as practical, thereafter.
Section 10 Improvement Security
10.1 Prior to issuance ofthe first building permit for the Project, and in accordance with Government Code section 66499 et seq., Developer shall provide, or cause its contractor to provide, improvement security for the Creditable Improvements based on the Estimated Costs thereof in favor ofthe City in an amount and form acceptable to the City.
Section 11 Limited City Obligation
11.1 The obligations arising from this Agreement are not a debt ofthe City, nor a legal or equitable pledge, charge, lien, or encumbrance, upon any ofits property, or upon any ofits income, receipts, or revenues, and are payable only from water and sewer capacity fees and rates and traffic impact fees paid to the City.
Section 12 Conveyance ofCreditable Improvements
12.1 Once Developer has completed construction ofthe Creditable Improvements and the Creditable Improvements are accepted and deemed satisfactory by the City, the Creditable Improvements automatically become the property ofthe City. Developer and City shall take any and all actions necessary to convey and vest full, complete and clear title in said facilities to the City.
Section 13 Delivery ofAs-Built Plans and Specifications
13.1 Prior to acceptance ofthe Creditable Improvements by City, Developer shall deliver to City copies ofall as-built plans ( ifany), specifications, operating manuals, service manuals, warranties and other documents relating to the design, construction, and operation of the Creditable Improvements described in this Agreement.
Section 14 Liens. Claims. and Encumbrances
14.1 Notwithstanding any other provision or term ofthis Agreement, the City shall have no obligation to apply Fee Credits or pay Fee Reimbursements after final acceptances for 7 084120\12321709v5
56 the Creditable Improvements until Developer has cleared any and all liens, claims and encumbrances from said facility, and provided the required guarantee documentation, guarantee, and assurance in writing, to the satisfaction ofthe City. Nothing herein shall prevent the application of Fee Credits prior to final acceptance of the Creditable Improvements, so long as Developer is not otherwise in breach of this Agreement.
Section 15 Intentionally Deleted. [ NOTE TO CITY. THIS IS COVERED IN THE SUBDIVISION IMPROVEMENT AGREEMENT]
Section 16 Third Party Liability
16.1 City does not assume any liability, duty or obligation to Developer' s contractors, subcontractors or agents by execution or performance of this Agreement and no contractors, subcontractors, agents or any parties are third party beneficiaries of this Agreement.
Section 17 Intentionally Deleted. [ NOTE TO CITY. TIDS IS COVERED IN THE SUBDIVISION IMPROVEMENT AGREEMENT]
17.1 Section 18 Binding on Successors and Assigns
18.1 Each and every provision of this Agreement shall be binding upon and shall inure to the benefit of the respective successors and assigns of the parties hereto, in the same manner as if such parties had been expressly named herein.
18.2 Developer shall have the right to assign or transfer this Agreement to any person, firm, or corporation at any time during the term of the Agreement. Developer shall provide City with written notice of any assignment or transfer of this Agreement no later than thirty ( 30) days after such assignment or transfer. Express written assumption by such assignee or transferee of the burdens and obligations of the Agreement shall release and relieve Developer of such burdens and obligations.
Section 19 Authority to Enter into Agreement
19.1 Developer and City certify that they are legally empowered to enter into this Agreement.
Section 20 Notice
20.1 Any notice, payment, or instrument required or permitted by this Agreement to either party shall be deemed to have been received when personally delivered to that party or seventy-two (72) hours following deposit of the same in any United States Post Office, first class, postage prepaid, addressed as follows:
City: City of American Canyon
Public Works Department
084120\12321709v5
4381 Broadway Street, Suite 201
American Canyon, CA 94503
Attn: ----------------
8 57
Developer: R.H. Hess Development Company, Inc.
3423 Broadway Street, Suite D-5
American Canyon, CA 94503
Attn: Richard Hess
20.2 Either party hereto may, by notice given hereunder, designate a different address to which subsequent notices, payments, and instruments shall be delivered to it.
Section 21
21.1 The term ofthis Agreement shall start on the day and year duly executed by all parties and shall remain in effect for a period often (10) years or until all the terms and conditions contained in this Agreement have been satisfied, whichever comes first.
21.2 Notwithstanding Section 21.1, any outstanding Fee Credits or Fee Reimbursements due to Developer or its transfers, successors, or assigns shall survive termination ofthis Agreement.
Section 22 Captions
22.1 Captions to Sections ofthis Agreement are for convenience purposes only, and are not part ofthis Agreement.
Section 23 Severability
23.1 Ifany portion ofthis Agreement is declared by a court ofcompetent jurisdiction to be invalid or unenforceable, such portion shall be deemed severed from this Agreement and the remaining parts shall remain in full effect as though such invalid or unenforceable provision had not been a part ofthis Agreement.
Section 24 Governing Law; Venue
24.1 This Agreement is made under, and shall in all respects be interpreted, enforced, and governed by, the laws ofthe State ofCalifornia. In the event ofa dispute concerning the terms ofthis Agreement, the venue for any legal action shall be with the appropriate court in the County ofNapa, State ofCalifornia.
Section 25 Exhibits
25.1 The Exhibits attached hereto are hereby incorporated herein by this reference. In the event ofany conflict between this Agreement and its Exhibits, the provisions ofthis Agreement shall govern.
Section 26 Entire Agreement
26.1 This Agreement contains the entire agreement between the parties with respect to the matters contained herein and may be amended only by subsequent written agreement signed by both parties.
9 084120\12321709v5
58 26.2 Notwithstanding the above, Developer and City have entered into a that certain Subdivision Improvement Agreement, dated ofeven date herewith ("Subdivision Improvement Agreement"). The provisions ofthe Subdivision Improvement Agreement shall continue to apply to the Improvements ( as defined therein).
Section 27 Counterparts
27.1 This Agreement may be executed in counterparts, each ofwhich shall be deemed an original, but both ofwhich together shall constitute one instrument.
Section 28 Construction and Interpretation
28.1 Developer and City agree and acknowledge that the provisions ofthis Agreement have been arrived at through negotiation and that each party has had a full and fair opportunity to revise the provisions ofthis Agreement and to have such provisions reviewed by legal counsel.
Therefore, any ambiguities in construing or interpreting this Agreement shall not be resolved against the drafting party.
Section 29 AppealslDispute Resolution
29.1 Developer may appeal any final determination by the City Engineer to the City Manager and thereafter to the City Council. Prior to submitting the matter to the City Council, the City Manager may, in hislher discretion, elect to engage the services ofa mediator to attempt to mediate the dispute in a non-binding fashion, not to exceed a total ofthirty (30) calendar days.
Any decision ofthe City Council shall be final with no right offurther appeal or action thereafter.
Section 30 Effective Date
30.1 The date ofapproval by the City Council ofthis Agreement shall be deemed to be the " Effective Date" ofthis Agreement. Upon execution ofthis Agreement by the City, the City shall insert the Effective Date in the Preamble to this Agreement and provide a copy ofthis fully executed and dated Agreement to Developer.
IN WITNESS WHEREOF, the City ofAmerican Canyon, a municipal corporation, has authorized the execution ofthis Agreement in duplicate by its City Manager and attestation by its City Clerk under authority ofResolution No. ---' adopted by the Council ofthe City of American Canyon on the 3rd day ofMay, 2022, and Developer has caused this Agreement to be executed.
SIGNATURES ON FOLLOWING PAGE(S)]
10 084120\12321709v5
59 CITY:
CITY OF AMERICAN CANYON,
a municipal corporation
By: ____________________ __
Its: City Manager
ATTEST:
By: ____________________ __
Its: City Clerk
APPROVED AS TO FORM:
By: ____________________ __
Its: City Attorney
APPROVED AS TO SUBSTANCE:
By: ____________________ __
Its: Public Works Director
084120\ 12321709v5
11 DEVELOPER:
R.H. HESS DEVELOPMENT COMPANY,
INC.
By: Richard Hess
Title: ---------------------
60 084120\12321709v5
EXHIBIT A
Project Location Map]
12 61
084120\ 12321709v5
EXHIBITB
Figures ofImprovements]
13 62
EXHmITC
ListlDescription ofImprovements]
1. Napa Junction Road Improvements:
a. Construct an approximately 300-foot segment ofNapa Junction Road between the Hess RoadlNapa Junction Road intersection and the existing roadway fronting Napa Junction Magnet Elementary School. The preliminary roadway shall have a curb-to-curb with of40-feet with 5-foot wide (includes curb width) attached sidewalks on both sides. The final roadway section shall be as determined by the City Engineer. The extent ofthe roadway construction may be extended as necessary to meet City roadway geometric standards. b. Construct a new 5-foot wide (includes curb width) attached sidewalk along the south side ofNapa Junction Road between the east end ofthe new road segment described above to the existing sidewalk approximately 100-feet west ofTheresa Avenue.
c. Construct a new 5-foot wide attached sidewalk along the south side ofNapa Junction Road between its intersection with Hess Road and the west end of Parcel A 's frontage.
2. Water Main Replacement in Napa Junction Road: Replace approximately 590 linear feet ofthe existing 6-inch water main in Napa Junction Road with a new 12-inch water main between the intersection with Theresa Avenue to the intersection with Hess Road, connecting to the existing water mains in those intersections.
3. Sanitary Sewer Main Replacement in Napa Junction Road and Theresa Avenue:
Replace approximately 1,800 linear feet ofthe existing 6-inch sanitary sewer mains in Napa Junction Road between Hess Road and Theresa Avenue and in Theresa Avenue from Napa Junction Road to a point approximately 1,200 linear feet south thereof with new 8- inch and IO-inch sanitary sewer mains. The Engineer ofRecord shall conduct a capacity analysis for the new sanitary sewers to determine where it should upsize from 8-inch to 10-inch.
4. Recycled Water Main in Lombard Road and Hess Road: Install approximately 1,300 linear feet ofa new 8-inch recycled water main in Lombard Road between the cul-desac at its northern terminus and Hess Drive and in Hess Drive between Lombard Road and the Little League fields.
5. Water Main Extension: Install approximately 1,310 linear feet of 12-inch water main in Napa Junction Road from the intersection ofHess Road to the Oat Hill Tank #2 , connecting to the existing 12-inch water mains.
14 084120\ 12321709v5
63 EXHIBITD
Form ofCertificate ofApplication ofFee Credits
The undersigned Developer, as the holder ofcertain Fee Credits related to the Fee Credit / Fee Reimbursement Agreement between Developer and the City ofAmerican Canyon, dated the "Agreement"), hereby elects to apply the amount ofFee Credits indicated below as a credit against the fees otherwise payable in connection with the issuance of building permit(s) for development ofthe property within the City described below:
Developer's Legal Name: _____________________ _
Pr~ectName: _________________________ _
Amount ofApplied Fee Credits: $ ______ _
Fee Credit Balance Available under Agreement Before Application: $ ____ _ Fee Credit Balance Available under Agreement After Application: $ ____ _ APPROVED: City Engineer: ____________________ _
DEVELOPER:
By: _____________ _
Name: ------------
Title: -------------
Date: --------------
15 084120\ 12321709v5
64 EXHIBITE
Form of Certificate of Assignment and Transfer of Fee Credit / Fee Reimbursement The undersigned Developer, as the holder ofcertain Fee Credits or Fee Reimbursements related to the Fee Credit / Fee Reimbursement Agreement between Developer and the City ofAmerican Canyon, dated ( the "Agreement"), hereby assigns, transfers and conveys to the undersigned Assignee the amount ofFee Credits or Fee Reimbursements as indicated below:
Developer' s Legal Name: ______________________ _
Assignee' s Name: _________________________ _
Amount ofAssigned Fee Credits/ Reimbursements: $ _____ _ Fee Credit/Reimbursement Balance Available under Agreement Before Transfer: $ ____ _ Fee Credit/Reimbursement Balance Available under Agreement After Transfer: $ ____ _ APPROVED: City Engineer: ___________ _
DEVELOPER:
By: ___________ __
Name: ____________ _
Title: -------------
Date: ----------------
ASSIGNEE:
By: ____________ __
Name: ---------------------
Title: _____________ _
Date: -------------
Contact Information: ---------
16 084120112321709v5
65 JOB NO. 1305-065 SHEET 1 OF 7
RECORDER'S STATEMENT
OWNER'S STATEMENT
BENEFICIARY'S ACKNOWLEDGMENT
CONSISTING OF 7 SHEETS
BEING A SUBDIVISION OF PARCEL ONE AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-0010758, NAPA COUNTY RECORDS.
APN: 058-380-008 AND PORTION OF 058-320-001, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
SEPTEMBER 2024
FINAL MAP OF PARCEL ONE
FOR CONDOMINIUM PURPOSES
OWNER'S ACKNOWLEDGMENT BENEFICIARY'S STATEMENT
DRAFT 2024.09.06
66 CONSISTING OF 7 SHEETS
BEING A SUBDIVISION OF PARCEL ONE AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-0010758, NAPA COUNTY RECORDS.
APN: 058-380-008 AND PORTION OF 058-320-001, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
SEPTEMBER 2024
FINAL MAP OF PARCEL ONE
FOR CONDOMINIUM PURPOSES
JOB NO. 1305-065 SHEET 2 OF 7
CITY CLERK'S CERTIFICATE SIGNATURE OMISSIONS
VICINITY MAP
SITE
CITY ENGINEER'S STATEMENT
COUNTY TAX COLLECTOR AND
REDEMPTION OFFICER'S CERTIFICATE
SURVEYOR'S STATEMENT
DRAFT 2024.09.06
67 NAPA JUNCTION ROAD
HESS DRIVE
NAPA JUNCTION ROAD
LEGEND
3 OF 7
GRAPHIC SCALE
100' 0' 50' 100' 200' 400'
SCALE: 1" =
CONSISTING OF 7 SHEETS
BEING A SUBDIVISION OF PARCEL ONE AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-0010758, NAPA COUNTY RECORDS.
APN: 058-380-008 AND PORTION OF 058-320-001, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
SEPTEMBER 2024
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
FINAL MAP OF PARCEL ONE
FOR CONDOMINIUM PURPOSES
JOB NO. 1305-065 SHEET
HESS DRIVE
BASIS OF BEARINGS:
REFERENCES:
NOTE:
100'
SHEET INDEX
SHEET NO. DESCRIPTION
DRAFT 2024.09.06
68 NAPA JUNCTION ROAD
4 OF 7
SCALE: 1" =
CONSISTING OF 7 SHEETS
BEING A SUBDIVISION OF PARCEL ONE AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-0010758, NAPA COUNTY RECORDS.
APN: 058-380-008 AND PORTION OF 058-320-001, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
SEPTEMBER 2024
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
FINAL MAP OF PARCEL ONE
FOR CONDOMINIUM PURPOSES
JOB NO. 1305-065 SHEET
40'
SEE SHEET 5
DETAIL A
GRAPHIC SCALE
40' 0' 20' 40' 80' 160' SEE SHEET 3
DETAIL B
PUE AND EVAE DETAIL SHEET
LEGEND
BASIS OF BEARINGS:
REFERENCES:
NOTE:
DRAFT 2024.09.06
69 5 OF 7
SCALE: 1" =
CONSISTING OF 7 SHEETS
BEING A SUBDIVISION OF PARCEL ONE AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-0010758, NAPA COUNTY RECORDS.
APN: 058-380-008 AND PORTION OF 058-320-001, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
SEPTEMBER 2024
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
FINAL MAP OF PARCEL ONE
FOR CONDOMINIUM PURPOSES
JOB NO. 1305-065 SHEET
40'
SEE SHEET 4 SEE BELOW SEE ABOVE
GRAPHIC SCALE
40' 0' 20' 40' 80' 160'
PUE AND EVAE DETAIL SHEET
LEGEND
BASIS OF BEARINGS:
REFERENCES:
NOTE:
DRAFT 2024.09.06
70 NAPA JUNCTION ROAD
6 OF 7
SCALE: 1" =
CONSISTING OF 7 SHEETS
BEING A SUBDIVISION OF PARCEL ONE AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-0010758, NAPA COUNTY RECORDS.
APN: 058-380-008 AND PORTION OF 058-320-001, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
SEPTEMBER 2024
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
FINAL MAP OF PARCEL ONE
FOR CONDOMINIUM PURPOSES
JOB NO. 1305-065 SHEET
40'
DETAIL A
SEE SHEET 7
GRAPHIC SCALE
40' 0' 20' 40' 80' 160'
WLE AND TE DETAIL SHEET SEE SHEET 3 LEGEND
BASIS OF BEARINGS:
REFERENCES:
NOTE:
DRAFT 2024.09.06
71 7 OF 7
SCALE: 1" =
CONSISTING OF 7 SHEETS
BEING A SUBDIVISION OF PARCEL ONE AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-0010758, NAPA COUNTY RECORDS.
APN: 058-380-008 AND PORTION OF 058-320-001, 1 PARCEL, 13.60 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
SEPTEMBER 2024
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
FINAL MAP OF PARCEL ONE
FOR CONDOMINIUM PURPOSES
JOB NO. 1305-065 SHEET
40'
SEE SHEET 6 SEE SHEET 3
GRAPHIC SCALE
40' 0' 20' 40' 80' 160'
WLE AND TE DETAIL SHEET
LEGEND
BASIS OF BEARINGS:
REFERENCES:
NOTE:
DRAFT 2024.09.06
72 JOB NO. 1305-065 SHEET 1 OF 5
OWNER'S STATEMENT
RECORDER'S STATEMENT
CONSISTING OF 5 SHEETS
BEING A SUBDIVISION OF PARCEL TWO AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-001759, NAPA COUNTY RECORDS.
APN: PORTION OF 058-320-001, 1 PARCEL, 7.12 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
SEPTEMBER 2024
FINAL MAP OF PARCEL TWO
FOR CONDOMINIUM PURPOSES
OWNER'S ACKNOWLEDGMENT
BENEFICIARY'S ACKNOWLEDGMENT
BENEFICIARY'S STATEMENT
DRAFT 2024.09.06
73 JOB NO. 1305-065 SHEET 2 OF 5
CITY CLERK'S CERTIFICATE
VICINITY MAP
SITE
CONSISTING OF 5 SHEETS
BEING A SUBDIVISION OF PARCEL TWO AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-001759, NAPA COUNTY RECORDS.
APN: PORTION OF 058-320-001, 1 PARCEL, 7.12 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
SEPTEMBER 2024
FINAL MAP OF PARCEL TWO
FOR CONDOMINIUM PURPOSES
CITY ENGINEER'S STATEMENT
COUNTY TAX COLLECTOR AND
REDEMPTION OFFICER'S CERTIFICATE SURVEYOR'S STATEMENT
DRAFT 2024.09.06
74 NAPA JUNCTION ROAD
HESS DRIVE
NAPA JUNCTION ROAD
3 OF 5
GRAPHIC SCALE
100' 0' 50' 100' 200' 400'
JOB NO. 1305-065 SHEET
BASIS OF BEARINGS:
REFERENCES:
NOTE:
SCALE: 1" =
CONSISTING OF 5 SHEETS
BEING A SUBDIVISION OF PARCEL TWO AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-001759, NAPA COUNTY RECORDS.
APN: PORTION OF 058-320-001, 1 PARCEL, 7.12 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
SEPTEMBER 2024
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
FINAL MAP OF PARCEL TWO
FOR CONDOMINIUM PURPOSES
100'
HESS DRIVE LEGEND
DRAFT 2024.09.06
75 NAPA JUNCTION ROAD
HESS DRIVE
PARCEL X
RIGHT OF WAY DEDICATION
4,208 SF±
4 OF 5
GRAPHIC SCALE
40' 0' 20' 40' 80' 160'
JOB NO. 1305-065 SHEET
BASIS OF BEARINGS:
REFERENCES:
NOTE:
LEGEND
SCALE: 1" =
CONSISTING OF 5 SHEETS
BEING A SUBDIVISION OF PARCEL TWO AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-001759, NAPA COUNTY RECORDS.
APN: PORTION OF 058-320-001, 1 PARCEL, 7.12 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
SEPTEMBER 2024
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
FINAL MAP OF PARCEL TWO
FOR CONDOMINIUM PURPOSES
40' SEE SHEET 5
DETAIL A
DRAFT 2024.09.06
76 JOB NO. 1305-065 SHEET
SCALE: 1" =
CONSISTING OF 5 SHEETS
BEING A SUBDIVISION OF PARCEL TWO AS DESCRIBED IN THAT
CONFIRMATORY DEED RECORDED AS DOCUMENT NUMBER 2023-001759, NAPA COUNTY RECORDS.
APN: PORTION OF 058-320-001, 1 PARCEL, 7.12 AC +/-
CITY OF AMERICAN CANYON, NAPA COUNTY CALIFORNIA
SEPTEMBER 2024
CIVIL ENGINEERS SURVEYORS PLANNERS
SAN RAMON
WWW.CBANDG.COM
ROSEVILLE
(925) 866-0322
(916)788-4456
FINAL MAP OF PARCEL TWO
FOR CONDOMINIUM PURPOSES
SEE SHEET 4
GRAPHIC SCALE
40' 0' 20' 40' 80' 160'
BASIS OF BEARINGS:
REFERENCES:
NOTE:
LEGEND
4 OF 5
40'
DRAFT 2024.09.06
SHEET 5 OF 5
77 CITY COUNCIL AGENDA
OCTOBER 15, 2024
STAFF REPORT
CONSENT
ITEM NUMBER: 10.
TITLE
Adoption of Caltrans Local Assistance Procedures Manual Chapter 10: Consultant Selection
RECOMMENDATION
Adopt Caltrans Local Assistance Procedures Manual Chapter 10: Consultant Selection
CONTACT
Erica Ahmann Smithies, PE, Public Works Director
BACKGROUND & ANALYSIS
The City's Public Works Department is responsible for construc0ng transporta0on projects that are state and federally funded. Occasionally, due to limited staffing and exper0se, certain services including Architectural and Engineering (A&E) are contracted out to qualified firms.
The Federal regula0ons set forth standards for procuring and administering A&E contracts. The provisions of the Brooks Act (40 United States Code, Sec0on 1104) requires local agencies to award federally funded engineering and design-related contracts, otherwise known as A&E contracts, on the basis of fair and open compe00ve nego0a0ons, demonstrated competence, and professional qualifications.
Title 23 Code of Federal Regula0ons Part 172 (23 CFR 172) allows Caltrans Division of Local Assistance (DLA) to prescribe the policies and procedures for engineering and design related services, also known as Architectural and Engineering (A&E). Local Public Agencies (LPAs) are responsible for adop0ng the wri?en policies and procedures prescribed by the awarding State Transportation Agency (STA).
Past process review findings by DLA showed a significant lack of, or incomplete A&E procurement policies and procedures as one of the most common findings. A non-compliance of this ma?er can result in a loss of funds and jeopardizing future opportunities to receive federal and state funds.
The State of California Department of Transporta0on (Caltrans) has developed the Local Assistance Procedures Manual (LAPM) Chapter 10, Consultant Selec0on which sets forth the forth policies and procedures to be u0lized by local agencies in the procurement and management of A&E contracts on state and federal funded transporta0on projects to ensure compliance with applicable Federal 78 and State laws and regula0ons and to maintain eligibility for federal-aid reimbursement. LPAs accept this responsibility when receiving federal funds from DLA, and by signing the Master Agreement for Federal-Aid Projects. DLA requires that local agencies adopt LAPM Chapter 10.
Staff recommends the City Council adopt Caltrans Local Assistance Procedures Manual Chapter 10:
Consultant Selec0on to demonstrate compliance and maintain eligibility to receive federal and state funds for future City projects.
COUNCIL PRIORITY PROGRAMS AND PROJECTS
Not applicable.
FISCAL IMPACT
Failure to adopt Caltrans Local Assistance Procedures Manual Chapter 10: Consultant Selec0on can significantly impact the City's access to federal- and state-aid funds for A&E expenditures, which would otherwise offset the need to use local funds. Hence, it is in the City's financial interest to pursue and utilize such funds in its delivery of projects, when possible.
ENVIRONMENTAL REVIEW
15378(b) - The ac0on is not a "Project" subject to the California Environmental Quality Act ("CEQA") because it does not qualify as a "Project" under Public Resources Code Sec0ons 21065 and 21080 and in Section 15378(b) of Title 14 of the California Code of Regulations.
ATTACHMENTS:
1. Resolution - Adoption of Caltrans LAPM Chapter 10
79 RESOLUTION NO. 2024-______
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AMERICAN CANYON ADOPTING CALTRANS LOCAL ASSISTANCE PROCEDURES MANUAL CHAPTER 10: CONSULTANT SELECTION WHEREAS, the City's Public Works Department is responsible for constructing transportation projects that are state and federally funded. Occasionally, due to limited staffing and expertise, certain services including Architectural and Engineering (A&E) are contracted out to qualified firms; and WHEREAS, Title 23 Code of Federal Regulations Part 172 (23 CFR 172) allows Caltrans Division of Local Assistance (DLA) to prescribe the policies and procedures for engineering and design related services; and WHEREAS, Local Public Agencies (LPAs) are responsible for adopting the written policies and procedures prescribed by the awarding State Transportation Agency (STA); and WHEREAS, Caltrans has developed the Local Assistance Procedures Manual (LAPM) Chapter 10:
Consultant Selection which sets forth the policies and procedures to be utilized by local agencies in the procurement and management of A&E contracts on state and federal funded transportation projects to ensure compliance with applicable Federal and State laws and regulations and to maintain eligibility for federal-aid reimbursement; and
WHEREAS, the City desires to adopt Caltrans’ LAPM Chapter 10 to demonstrate compliance and maintain eligibility to receive federal and state funds for future City projects.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of American Canyon hereby adopts the Local Assistance Procedures Manual Chapter 10: Consultant Selection dated January 2024 or as amended in future updates.
PASSED, APPROVED and ADOPTED at a regularly scheduled meeting of the City Council of the City of American Canyon held on the 15
th day of October, 2024, by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
____________________________
Leon Garcia, Mayor
ATTEST: APPROVE AS TO FORM:
____________________________ _____________________________ Taresa Geilfuss, CMC, City Clerk William D. Ross, City Attorney 80 CITY COUNCIL AGENDA
OCTOBER 15, 2024
STAFF REPORT
CONSENT
ITEM NUMBER: 11.
TITLE
Renegotiated Administrative Service Agreement with MissionSquare Retirement
RECOMMENDATION
Adopt a Resolu-on approving a renego-ated Administra-ve Service Agreement with MissionSquare Retirement.
CONTACT
Maria Ojeda, Assistant City Manager
Juan Gomez, Finance Director
BACKGROUND & ANALYSIS
The City of American Canyon sponsors a Governmental 457(b) Deferred Compensa-on Plan under Sec-on 457(b) of the Internal Revenue Code (IRC); and a 401(a) Money Purchase Plan under Sec-on 401(a) of the IRC. Two op-ons are available to full -me employees, Core Bridge and MissionSquare.
Staff conducted an evalua-on of the administra-ve fees of the MissionSquare Plan (Plan) in comparison to other jurisdic-ons and worked with MissionSquare directly to renego-ate an agreement with lower fees that will benefit Plan par-cipants. The renego-ated fees will result in an es-mated 1.25% combined savings to employees at the plan and fund level. The renego-ated agreement provides for a 7-year term and access to in person appointments provided by Cer-fied Financial Planners.
Staff also con-nues to work with Core Bridge to renego-ate plan administra-ve fees. A similar report will be presented for consideration once those negotiations are complete.
COUNCIL PRIORITY PROGRAMS AND PROJECTS
Organizational Effectiveness: "Deliver exemplary government services."
FISCAL IMPACT
None.
ENVIRONMENTAL REVIEW
81 15378(b) - The ac-on is not a "Project" subject to the California Environmental Quality Act ("CEQA") because it does not qualify as a "Project" under Public Resources Code Sec-ons 21065 and 21080 and in Section 15378(b) of Title 14 of the California Code of Regulations.
ATTACHMENTS:
1. Resolution - Mission Square
2. Mission Square Agreement
82 RESOLUTION NO. 2024-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AMERICAN CANYON
APPROVING A RENEGOTIATED ADMINISTRATIVE SERIVCE AGREEMENT
WITH MISSIONSQUARE RETIREMENT
WHEREAS, the City of American Canyon sponsors Governmental 457(b) Deferred Compensation Plan (Plan)under Section 457(b) of the Internal Revenue Code (IRC); and 401(a) Money Purchase Plan (Plan) under Section 401(a) of the IRC; and
WHEREAS, under the California State Constitution, Article XVI Section 17, government entities that sponsor a 457(b) and /or 401(a) plans, have fiduciary responsibilities as Plan Sponsors to ensure the operation and investment of their respective public retirement plans are for the exclusive purpose of providing benefits to participants and beneficiaries; and WHEREAS, a comparison of administrative fees including base fee and services fees was completed by staff; and
WHEREAS, after evaluations were completed, staff is recommending the City Council approve a renegotiated agreement with the MissionSquare. Under the renegotiated Administrative Services Agreement, plan participants will receive lower plan fees and enhanced services from certified financial planners; and
WHEREAS, City Council delegates the administration and fiduciary oversight duties, authority and responsibilities of the 457(b) and 401(a) plan to the Finance Director.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of American Canyon authorizes the City Manager to sign the Administrative Services Agreement for 457(b) and 401(a) with MissionSquare.
The assets of the Plan shall be held in trust, with the City serving as trustee, for the exclusive benefit of the Plan participants and their beneficiaries, and the assets shall not be diverted to any other purpose.
The Trustee’s beneficial ownership of Plan assets held in MissionSquare’s Retirement Trust shall be held for the further exclusive benefit of the Plan participants and their beneficiaries. The City will serve as the trustee under the plan.
PASSED, APPROVED and ADOPTED at a regularly scheduled meeting of the City Council of the City of American Canyon held on the 15th day of October 2024, by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
Leon Garcia, Mayor
ATTEST: APPROVED AS TO FORM:
Taresa Geilfuss, CMC, City Clerk William D. Ross, City Attorney 83 ADMINISTRATIVE SERVICES AGREEMENT
for
City of American Canyon
Type: 457
Account #: 303799
Type: 401
Account #: 107400
84 MissionSquare Retirement Agreement 1 of 12
ADMINISTRATIVE SERVICES AGREEMENT
This Administrative Services Agreement (“Agreement”), made as of this day, (please enter date) ____________________________________, (herein referred to as the "Inception Date"), between the International City Management Association Retirement Corporation doing business as MissionSquare Retirement (“MissionSquare”), a nonprofit corporation organized and existing under the laws of the State of Delaware, and the City of American Canyon (“Employer”), an Entity organized and existing under the laws of the State of California with an office at 4381 Broadway Street, Suite 201, American Canyon, California 94503.
RECITALS
Employer acts as public plan sponsor of a retirement plan (“Plan”), and in that capacity, has responsibility to obtain administrative services and investment alternatives for the Plan;
VantageTrust is a group trust established and maintained in accordance with New Hampshire Revised Statutes Annotated section 391:1 and Internal Revenue Service Revenue Ruling 81-100, 1981-1 C.B. 326, which provides for the commingled investment of retirement funds;
MissionSquare, or its wholly owned subsidiary, acts as investment adviser to VantageTrust Company, LLC, the Trustee of VantageTrust; MissionSquare has designed, and VantageTrust Company offers, a series of separate funds (the “Funds”) for the investment of plan assets as referenced in the Funds’ principal disclosure documents, the Disclosure Memorandum and the Fact Sheets (together, “MissionSquare Disclosures”); and MissionSquare provides a range of services to public employers for the operation of employee retirement plans including, but not limited to, communications concerning investment alternatives, account maintenance, account recordkeeping, investment and tax reporting, transaction processing, and benefit disbursement.
85 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 2 of 12
AGREEMENTS
1. Appointment of MissionSquare
Employer hereby appoints MissionSquare as administrator of the Plan to perform all nondiscretionary functions necessary for the administration of the Plan. The functions to be performed by MissionSquare shall be those set forth in Exhibit A to this Agreement.
2. Adoption of VantageTrust
Employer has adopted the Declaration of Trust of VantageTrust Company and agrees to the commingled investment of assets of the Plan within VantageTrust.
Employer agrees that the investment, management, and distribution of amounts deposited in VantageTrust shall be subject to the Declaration of Trust, as it may be amended from time to time and shall also be subject to terms and conditions set forth in disclosure documents (such as the MissionSquare Disclosures or Employer Bulletins) as those terms and conditions may be adjusted from time to time.
3. Employer Duty to Furnish Information
Employer agrees to furnish to MissionSquare on a timely basis such information as is necessary for MissionSquare to carry out its responsibilities as Administrator of the Plan, including information needed to allocate individual participant accounts to Funds in the Plan, and information as to the employment status of participants, and participant ages, addresses, and other identifying information (including tax identification numbers). Employer also agrees that it will notify MissionSquare in a timely manner regarding changes in staff as it relates to various roles. Such notification is to be completed through the plan sponsor website. MissionSquare shall be entitled to rely upon the accuracy of any information that is furnished to it by a responsible official of the Employer or any information relating to an individual participant or beneficiary that is furnished by such participant or beneficiary, and MissionSquare shall not be responsible for any error arising from its reliance on such information. MissionSquare will provide reports and account information to the Employer through the plan sponsor website.
Employer is required to send in contributions through the plan sponsor website.
Alternative electronic methods may be allowed but must be approved by MissionSquare for use. Contributions may not be sent through paper submittal documents.
To the extent Employer selects third-party investment options that do not have profile information provided to MissionSquare through MissionSquare’s 86 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 3 of 12
electronic data feeds from external sources (such as Morningstar) or the thirdparty investment option providers, the Employer is responsible for providing to MissionSquare timely investment option updates for disclosure to Plan participants. Such updates may be provided to MissionSquare through the Employer’s investment consultant or other designated representative.
4. MissionSquare Representations and Warranties
MissionSquare represents and warrants to Employer that:
(a) MissionSquare is a non-profit corporation with full power and authority to enter into this Agreement and to perform its obligations under this Agreement. The ability of MissionSquare, or its wholly owned subsidiary, to serve as investment adviser to VantageTrust Company is dependent upon the continued
willingness of VantageTrust Company for MissionSquare, or its wholly owned subsidiary, to serve in that capacity.
(b) MissionSquare is an investment adviser registered as such with the U.S. Securities and Exchange Commission under the Investment Advisers Act of 1940, as amended.
(c)(i) MissionSquare shall maintain and administer the 457(b) Plan in accordance with the requirements for eligible deferred
compensation plans under Section 457 of the Internal Revenue Code and other applicable federal law; provided, however, that MissionSquare shall not be responsible for the eligible status of the 457(b) Plan in the event that the Employer directs MissionSquare to administer the 457(b) Plan or disburse assets in a manner inconsistent with the requirements of Section 457 or otherwise causes the 457(b) Plan not to be carried out in accordance with its terms. Further, in the event that the Employer uses its own customized plan document, MissionSquare shall not be
responsible for the eligible status of the 457(b) Plan to the extent affected by terms in the Employer’s plan document that differ from those in MissionSquare’s model plan document. MissionSquare shall not be responsible for monitoring state or local law applicable to retirement plans or for administering the 457(b) Plan in compliance with local or state requirements regarding plan administration unless Employer notifies MissionSquare of any such local or state requirements.
(c)(ii) MissionSquare shall maintain and administer the 401(a) Plan in accordance with the requirements for plans which satisfy the qualification requirements of Section 401 of the Internal Revenue 87 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 4 of 12
Code and other applicable federal law; provided, however, MissionSquare shall not be responsible for the qualified status of the 401(a) Plan in the event that the Employer directs
MissionSquare to administer the 401(a) Plan or disburse assets in a manner inconsistent with the requirements of Section 401 or otherwise causes the 401(a) Plan not to be carried out in accordance with its terms; provided, further, that if the plan document used by the Employer contains terms that differ from the terms of MissionSquare's model plan document, MissionSquare shall not be responsible for the qualified status of the 401(a) Plan to the extent affected by the differing terms in the Employer's plan document. MissionSquare shall not be responsible for monitoring state or local law applicable to retirement plans or for administering the 401(a) Plan in compliance with local or state requirements regarding plan administration unless Employer notifies MissionSquare of any such local or state requirements.
5. Employer Representations and Warranties
Employer represents and warrants to MissionSquare that:
(a) Employer is organized in the form and manner recited in the opening paragraph of this Agreement with full power and authority to enter into and perform its obligations under this Agreement and to act for the Plan and participants in the manner contemplated in this Agreement. Execution, delivery, and performance of this Agreement will not conflict with any law, rule, regulation or contract by which the Employer is bound or to which it is a party.
(b) Employer understands and agrees that MissionSquare’s sole function under this Agreement is to act as recordkeeper and to provide administrative, investment or other services at the direction of Plan participants, the Employer, its agents or designees in accordance with the terms of this Agreement. Under the terms of this Agreement, MissionSquare does not render investment advice, is neither the “Plan Administrator” nor “Plan Sponsor” as those terms are defined under applicable federal, state, or local law, and does not provide legal, tax or accounting advice with respect to the creation, adoption or operation of the Plan and its related trust. MissionSquare does not perform any service under this Agreement that might cause MissionSquare to be treated as a “fiduciary” of the Plan under applicable law, except, and only, to the extent that MissionSquare provides investment 88 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 5 of 12
advisory services to individual participants enrolled in Guided Pathways Advisory Services.
(c) Employer acknowledges and agrees that MissionSquare does not assume any responsibility with respect to the selection or retention of the Plan’s investment options. Employer shall have exclusive responsibility for the Plan’s investment options, including the selection of the applicable share class.
(d) Employer acknowledges that certain such services to be performed by MissionSquare under this Agreement may be
performed by an affiliate or agent of MissionSquare pursuant to one or more other contractual arrangements or relationships, and that MissionSquare reserves the right to change vendors with which it has contracted to provide services in connection with this Agreement without prior notice to Employer.
(e) Employer approves the use of its Plan in MissionSquare external media, publications and materials. Examples include press releases announcements and inclusion of the general plan information in request for proposal responses.
6. Participation in Certain Proceedings
The Employer hereby authorizes MissionSquare to act as agent, to appear on its behalf, and to join the Employer as a necessary party in all legal proceedings involving the garnishment of benefits or the transfer of benefits pursuant to the divorce or separation of participants in the Plan. Unless Employer notifies MissionSquare otherwise, Employer consents to the disbursement by MissionSquare of benefits that have been garnished or transferred to a former spouse, current spouse, or child pursuant to a domestic relations order or child support order.
7. Compensation and Payment
(a) MissionSquare’s compensation under this Agreement shall be as set forth in subsection (b) below.
(b) Compensation for Management Services to VantageTrust Company, Compensation for Advisory and other Services to the MissionSquare Funds Class M and Payments from ThirdParty Investment Options. Employer acknowledges that MissionSquare, or its wholly owned subsidiary, receives fees from VantageTrust Company for investment advisory services and plan and participant services furnished to VantageTrust Company. 89 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 6 of 12
Employer further acknowledges that MissionSquare, including certain of its wholly owned subsidiaries, receives compensation for advisory and other services furnished to the MissionSquare Funds Class M, which serve as the underlying portfolios of a number of Funds offered through VantageTrust. For a MissionSquare Fund Class R that invests substantially all of its assets in a third-party mutual fund not affiliated with MissionSquare, MissionSquare or its wholly owned subsidiary receives payments from the third-party mutual fund families or their service providers in the form of 12b-1 fees, service fees, compensation for sub-accounting and other services provided based on assets in the underlying third-party mutual fund. These fees are described in the MissionSquare Disclosures and MissionSquare’s fee disclosure statement. In addition, to the extent that third party options are included in the investment line-up for the Plan, MissionSquare receives administrative fees from its third-party settlement and clearing agent for providing administrative and other services based on assets invested in third-party investment options; such administrative fees come from payments made by third-party investment options to the settlement and clearing agent. (c) Redemption Fees. Redemption fees imposed by outside investment options in which Plan assets are invested are collected and paid to the investment option by MissionSquare.
MissionSquare remits 100% of redemption fees back to the specific investment option to which redemption fees apply. These redemption fees and the individual investment option’s policy with respect to redemption fees are specified in the prospectus for the individual mutual fund and referenced in the MissionSquare Disclosures.
(d) Payment Procedures. All payments to MissionSquare pursuant to this Section 7 shall be made from Plan assets held by VantageTrust or received from third-party investment options or their service providers in connection with Plan assets invested in such thirdparty investment options, to the extent not paid by the Employer.
The amount of Plan assets administered by MissionSquare shall be adjusted as required to reflect any such payments as are made from the Plan. In the event that the Employer agrees to pay amounts owed pursuant to this Section 7 directly, any amounts unpaid and outstanding after 30 days of invoice to the Employer shall be withdrawn from Plan assets.
The compensation and payment set forth in this Section 7 are contingent upon the Employer’s using MissionSquare’s plan sponsor website for contribution 90 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 7 of 12
processing and submitting contribution funds by ACH or wire transfer on a consistent basis over the term of this Agreement. The compensation in this Section 7 is also based on the assets of the Plan being invested in R5 shares of MissionSquare PLUS Fund and the Employer offering the MissionSquare PLUS Fund as the sole stable value option.
The compensation and payment in this Section 7 will take effect in the calendar quarter following receipt at a Delivery Address (defined below the signature line) of one fully executed copy of this Administrative Services Agreement based upon the following schedule:
• Agreement received by February 20 – Effective April
• Agreement received by May 20 – Effective July
• Agreement received by August 20 – Effective October
• Agreement received by November 20 – Effective January Employer further acknowledges and agrees that compensation and payment under this Agreement shall be subject to re-negotiation in the event that the Employer (a) chooses to implement additional mutual funds that neither (i) trade via NSCC nor (ii) meet MissionSquare’s daily trading operational guidelines or (b) chooses to implement investment options that are not mutual funds.
8. Indemnification
MissionSquare shall not be responsible for any acts or omissions of any person with respect to the Plan or its related trust, other than MissionSquare in connection with the administration or operation of the Plan. Employer shall indemnify MissionSquare against, and hold MissionSquare harmless from, any and all loss, damage, penalty, liability, cost, and expense, including without limitation, reasonable attorney’s fees, that may be incurred by, imposed upon, or asserted against MissionSquare by reason of any claim, regulatory proceeding, or litigation arising from any act done or omitted to be done by any individual or person with respect to the Plan or its related trust, excepting only any and all loss, damage, penalty, liability, cost or expense resulting from MissionSquare’s negligence, bad faith, or willful misconduct.
9. Term
This Agreement shall be in effect and commence on the date all parties have signed and executed this Agreement (“Inception Date”). The term of this Agreement will commence on the Inception Date and extend seven (7) years from that date. This Agreement will be renewed automatically for each succeeding year unless written notice of termination is provided by either party to the other no less than 60 days before the end of such Agreement year. The Employer understands and acknowledges that, in the event the Employer 91 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 8 of 12
terminates this Agreement (or replaces the MissionSquare PLUS Fund of VantageTrust as an investment option in its investment line-up), MissionSquare retains full discretion to release Plan assets invested in the MissionSquare PLUS Fund in an orderly manner over a period of up to 12 months from the date MissionSquare receives written notification from the Employer that it has made a final and binding selection of a replacement for MissionSquare as administrator of the Plan (or a replacement investment option for the MissionSquare PLUS Fund).
10. Amendments and Adjustments
(a) This Agreement may be amended by written instrument signed by the parties.
(b) MissionSquare may modify this Agreement by providing 60 days’ advance written notice to the Employer prior to the effective date of such proposed modification. Such modification shall become effective unless, within the 60-day notice period, the Employer notifies MissionSquare in writing that it objects to such modification.
(c) The parties agree that enhancements may be made to administrative services under this Agreement. The Employer will be notified of enhancements or reduction in fees through electronic messages or special mailings.
11. Notices
Unless otherwise provided in this Agreement, all notices required to be delivered under this Agreement shall be in writing and shall be delivered, mailed, e-mailed or faxed to the location of the relevant party set forth below or to such other address or to the attention of such other persons as such party may hereafter specify by notice to the other party.
MissionSquare: Legal Department, MissionSquare, 777 North Capitol Street, N.E., Suite 600, Washington, D.C., 20002-4240 Facsimile; (202) 962-4601
Employer: at the office set forth in the first paragraph hereof, or to any other address, facsimile number or e-mail address designated by the Employer to receive the same by written notice similarly given.
Each such notice, request or other communication shall be effective: (i) if given by facsimile, when transmitted to the applicable facsimile number and there is appropriate confirmation of receipt; (ii) if given by mail or e-mail, upon 92 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 9 of 12
transmission to the designated address with no indication that such address is invalid or incorrect; or (iii) if given by any other means, when actually delivered at the aforesaid address.
12. Complete Agreement
This Agreement shall constitute the complete and full understanding and sole agreement between MissionSquare and Employer relating to the object of this Agreement and correctly sets forth the complete rights, duties and obligations of each party to the other as of its date. This Agreement supersedes all written and oral agreements, communications or negotiations among the parties. Any prior agreements, promises, negotiations or representations, verbal or otherwise, not expressly set forth in this Agreement are of no force and effect.
13. Titles
The headings of Sections of this Agreement and the headings for each of the attached Exhibits are for convenience only and do not define or limit the contents thereof.
14. Incorporation of Exhibits
All Exhibits (and any subsequent amendments thereto), attached hereto, and referenced herein, are hereby incorporated within this Agreement as if set forth fully herein.
15. Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of California, applicable to contracts made in that jurisdiction without reference to its conflicts of laws provisions.
93 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 10 of 12
In Witness Whereof, the parties hereto certify that they have read and understand this Agreement and all Exhibits attached hereto and have caused this Agreement to be executed by their duly authorized officers as of the Inception Date first above written.
APPROVED AS TO FORM CITY OF AMERICAN CANYON
By ___________________________ By _______________________________ William D. Ross, City Attorney Signature/Date
By _________________________________
Name and Title (Please Print)
THE INTERNATIONAL CITY MANAGEMENT
ASSOCIATION RETIREMENT CORPORATION
doing business as MISSIONSQUARE
RETIREMENT
By ___________________________________________
Erica McFarquhar
Assistant Secretary
[An execution copy will be provided via DocuSign]
Deleted: ¶
Formatted: Indent: Left: 0", Tab stops: Not at 1.32" + 2" Deleted: _______
Deleted: ___________
Formatted: Indent: Left: 0", First line: 0"
Deleted: ___________
94 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 11 of 12
Exhibit A
Administrative Services
The administrative services to be performed by MissionSquare under this Agreement shall be as follows:
(a) Participant enrollment services are provided online. Employees will enroll online through a secure site or the Employer will enroll employees through the plan sponsor website.
(b) Establishment of participant accounts for each employee participating in the Plan for whom MissionSquare receives appropriate enrollment instructions. MissionSquare is not responsible for determining if such Plan participants are eligible under the terms of the Plan.
(c) Allocation in accordance with participant directions received in good order of individual participant accounts to investment options offered under the Plan.
(d) Maintenance of individual accounts for participants reflecting amounts deferred, income, gain or loss credited, and amounts distributed as benefits.
(e) Maintenance of records for all participants for whom participant accounts have been established. These files shall include enrollment instructions (provided to MissionSquare through the participant website or the plan sponsor website), beneficiary designation instructions and all other documents concerning each participant's account.
(f) Provision of periodic reports to the Employer through the plan sponsor website. Participants will have access to account information through Participant Services, Voice Response System, the participant website, and text access, and through quarterly statements that can be delivered electronically through the participant website or by postal service. (g) Communication to participants of information regarding their rights and elections under the Plan.
(h) Making available Participant Services Representatives through a toll-free telephone number from 8:30 a.m. to 9:00 p.m. Eastern Time, Monday through Friday (excluding holidays and days on which the securities markets or MissionSquare are closed for business (including emergency closings)), to assist participants.
(i) Making available access to MissionSquare’s website, to allow participants to access certain account information and initiate certain plan transactions at any time. The participant website is normally 95 Plan numbers 303799, 107400
MissionSquare Retirement Agreement 12 of 12
available 24 hours a day, seven days a week except during scheduled maintenance periods designed to ensure high-quality performance. (j) Maintaining the security and confidentiality of client information through a system of controls including but not limited to, as appropriate:
restricting plan and participant information only to those who need it to provide services, software and hardware security, access controls, data back-up and storage procedures, non-disclosure agreements, security incident response procedures, and audit reviews.
(k) Making available access to MissionSquare’s plan sponsor web site to allow plan sponsors to access certain plan information and initiate plan transactions such as enrolling participants and managing contributions at any time. The plan sponsor web site is normally available 24 hours a day, seven days a week except during scheduled maintenance periods designed to ensure high-quality performance.
(l) Distribution of benefits as agent for the Employer in accordance with terms of the Plan. Participants who have separated from service can request distributions through the participant website or via form. (m)MissionSquare is authorized by the Employer to (a) determine whether a domestic relations order is an acceptable qualified domestic relations order under the terms of the Plan and (b) establish a separate account record for the alternate payee and provide for the investment and distribution of assets held thereunder.
(n) Loans may be made available on the terms specified in the Loan Guidelines, if loans are adopted by the Employer. Participants can request loans through the participant website.
(o) Guided Pathways Advisory Services – MissionSquare’s participant advice service, “Fund Advice”, may be made available through a third-party vendor on the terms specified on MissionSquare’s website. (p) MissionSquare is authorized by the Employer to establish an unallocated plan level expense account to function as the Administrative Allowance account, to be invested as Employer directs.
(q) MissionSquare will determine appropriate delivery method (electronic and/or print) for plan sponsor/participant communications and education based on a number of factors (audience, effectiveness, etc.) 96 CITY COUNCIL AGENDA
OCTOBER 15, 2024
STAFF REPORT
CONSENT
ITEM NUMBER: 12.
TITLE
Water Reclamation Facility Membrane Replacement
RECOMMENDATION
Adopt a Resolu+on authorizing the City Manager to execute a purchase agreement with Veolia Water Technologies and Solu+ons for the procurement of eight hundred ninety-six (896) "ZW500D RX12 430 =²” membrane modules, twelve (12) ZW500D LEAPmbr 16M casseAe frames, and associated materials for exis+ng casseAe refurbishment and LEAPmbr upgrade, for use at the Water Reclama+on Facility for a total cost of $3,121,330 and amending the Fiscal Year 2024/25 budget to increase Wastewater Opera+ons Fund 540 by $422,087 and Wastewater Capacity Fee Fund 550 by $202,179 to account for the current Year 1 membrane cost of $624,266.
CONTACT
Erica Ahmann Smithies, P.E., Public Works Director
Brian Anderson, Interim Wastewater Systems Manager
BACKGROUND & ANALYSIS
Background
The wastewater treatment process at the City’s Water Reclama+on Facility (WRF), also known as the Wastewater Treatment Plant, involves two primary methods: biochemical treatment and physical screening. Wastewater inflows fluctuate significantly in volume and composi+on throughout the day, month, and year. Despite this variability, the City is mandated to maintain consistently high effluent quality at all +mes. Therefore, it is essen+al to ensure that the WRF has sufficient hydraulic and biochemical treatment capacity to protect the environment and supply a reliable, con+nuous source of recycled water to customers.
The WRF is currently equipped with 704 membrane modules (Model ZW 500D), organized into 11 casseAes across four treatment trains. However, as these membranes age, their hydraulic capacity diminishes. A=er eight years of service, the current membranes have reached the end of their expected lifespan. This capacity decline restricts the facility’s ability to manage increased inflows during winter storms, when wastewater volumes can surge to three to four +mes the normal dryweather flow. This limita+on became par+cularly evident during the storm events of 2023 and 2024.
97 The WRF was ini+ally designed to handle normal dry-weather flows of 2.5 MGD (million gallons per day), with a peak wet-weather capacity of 5.0 MGD over a 48-hour period. However, during the 2024 storms, the facility could only reach a maximum flow of 4.2 MGD. In recent years, staff has presented the Council with four key improvements to enhance both the quan+ty and quality of effluent processed at the facility. First, the Energy Retrofit Project (ERP) was completed in 2013, which increased biochemical treatment capacity and significantly reduced energy consump+on.
Second, in 2015, the Council approved the purchase of new membranes. Third, in 2016, the Council authorized the design and installa+on of new screening equipment, including the addi+on of a third screen in 2016 and the replacement of 3mm screens with 2mm drum screens in 2019. These improvements have op+mized the balance of influent quan+ty and quality. Finally, in 2016, modifica+ons were made to the chlorine contact basins to improve chlorine contact +me, a key metric for recycled water quality compliance. Despite these upgrades, the aging membranes are limiting the facility’s ability to process influent efficiently, especially during high inflow periods.
There are financial risks associated with maintaining a plant at less than the needed capacity. If we cannot produce a reliable stream of recycled water, we would have to acquire potable or raw water at a much higher cost. Addi+onally, in a high storm event, we risk spilling stored influent into the wetlands and associated fines. Finally, we risk being unable to keep up with the requirements of future growth in the community.
The proposed installa+on of new membranes will restore the WRF’s hydraulic capacity to 5 MGD for extended periods. Addi+onally, the replacement of current membrane modules and the installa+on of new casseAes will increase the facility’s maximum hydraulic flow to 7.2 MGD. Although daily flow cannot exceed 5 MGD, the ability to operate at maximum capacity without degrading membrane integrity will allow the facility to handle higher volumes of wastewater efficiently.
Proposal
The City has received a proposal from Veolia Water Technologies and Solu+ons to replace one complete membrane train a year over a four-year period. The total cost for this project is $3,121,330, payable over five annual installments of $624,266.
Veolia's proposal includes replacing all exis+ng membrane modules, installing new casseAes and modules in the vacant spaces across all four trains, and upgrading the scour aera+on system to LEAPmbr, further enhancing energy efficiency. In addition, the proposal includes using the newer ZW 500D RX12 model membranes, which have a higher hydraulic capacity than the current ZW 500D model.
By increasing the number of casseAes from 44 to 56, the facility will not only improve its ability to treat peak flows for sustained periods, but also extend the lifespan of the membranes due to reduced stress on individual modules.
COUNCIL PRIORITY PROGRAMS AND PROJECTS
98 Infrastructure: "Develop and maintain infrastructure resources to support sustainable growth."
FISCAL IMPACT
The cost of purchasing new membranes ($3,121,330) is proposed to be paid over a period of five years. The exis+ng membrane replacements were included in the recently adopted wastewater user fee structure and will u+lize opera+ng budget ($2,110,433), the cost for membranes that increase the plant's hydraulic capacity will utilize wastewater capacity fee budget ($1,010,897).
The annual cost of the replacements ($624,266) will be included in the Wastewater Opera+ons Fund 540 ($422,087) and Wastewater Capacity Fee Fund 550 ($202,179) FY2024-2025 Budget and each successive year thereafter for five years.
ENVIRONMENTAL REVIEW
15301 - The Project is exempt from review under the California Environmental Quality Act ("CEQA") under the Class 1 exemp+on of exis+ng facili+es of Sec+on 15301 of Title 14 of the California Code of Regula+ons and said exemp+on is not negated by any excep+on under Sec+on 15300.2 of said Regulations.
ATTACHMENTS:
1. Resolution Veolia Water Technologies
2. Veolia Proposal
99 RESOLUTION NO. 2024-
AUTHORIZING THE CITY MANAGER TO EXECUTE A PURCHASE AGREEMENT WITH VEOLIA WATER TECHNOLOGIES AND SOLUTIONS FOR THE PROCUREMENT OF EIGHT HUNDRED NINETY-SIX (896) "ZW500D RX12 430 FT²” MEMBRANE MODULES, TWELVE (12) ZW500D LEAPMBR 16M CASSETTE
FRAMES, AND ASSOCIATED MATERIALS FOR EXISTING CASSETTE REFURBISHMENT AND LEAPMBR UPGRADE, FOR USE AT THE WATER RECLAMATION FACILITY FOR A TOTAL COST OF $3,121,330 AND AMENDING THE FISCAL YEAR 2024/25 BUDGET TO INCREASE WASTEWATER OPERATIONS FUND 540 BY $422,087 AND WASTEWATER CAPACITY FEE FUND 550 BY $202,179 TO ACCOUNT FOR THE CURRENT YEAR 1 MEMBRANE COST OF $624,266
WHEREAS, the City’s Water reclamation facility (WRF) utilizes a micro-membrane filtration process; and WHEREAS, the current membranes were commissioned in 2015 and have reached their life expectancy; and
WHEREAS, a membrane’s hydraulic capacity reduces as it ages and during the last several storm events they experienced difficulty treating the increased volumes of influent in a timely manner; and WHEREAS, the WRF currently utilizes a total of forty four (44) Veolia Water Technologies and solutions “ZW 500D” membrane cassettes which are proposed to be replaced with fifty-six (56) newer, higher hydraulic capacity “ZW 500D RX12” membrane cassettes.
WHEREAS, the cost of the existing full membrane replacement including additional capacity membranes is $3,121,330 and was included in the adopted wastewater user structure fee; and WHEREAS, Veolia will replace one complete membrane train a year for four years; and WHEREAS, the cost of purchasing the new membranes is proposed to be paid over 5 years; and WHEREAS, the annual cost of $624,266 will be provided for in Wastewater Operations Fund 540 ($422,087) and Wastewater Capacity Fee Fund 550 ($202,179) in Fiscal Year 2024-2025 and every year thereafter.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of American Canyon hereby authorizes the City Manager to enter into a purchase agreement with Veolia Water Technologies and Solutions for the purchase of eight hundred ninety-six (896) “ZW 500D RX12” membrane modules, twelve (12) ZW 500D LEAPmbr cassettes and associated materials for existing cassette refurbishment and LEAPmbr upgrade for the Water Reclamation Facility for a total cost of $3,131,300; and NOW, THEREFORE, BE IT FURTHER RESOLVED thatthe City Council of the City of American Canyon, hereby amends the Fiscal Year 2024/25 Budget to increase Wastewater Operations Fund 540 by $422,087 and Wastewater Capacity Fee Fund 550 by $202,179 to account for the current Year 1 Membrane cost of $624,266.
100
2 PASSED, APPROVED and ADOPTED at a regularly scheduled meeting of the City Council of the City of American Canyon held on the 15th day of October, 2024 by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
____________________________
Leon Garcia, Mayor
ATTEST: APPROVE AS TO FORM:
____________________________ _____________________________ Taresa Geilfuss, CMC, City Clerk William D. Ross, City Attorney 101
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 1 of 28 Membrane Replacement Agreement
To: City of American Canyon, referred to
here as American Canyon or Buyer
Date: September 24, 2024
No. of Pages: 28 including cover
Attention: Nolan Garcia Email: NGarcia@cityofamericanca nyon.org
Plant
Address:
151 Mezzetta Court
American Canyon, CA 94503 Telephone: 707 647 4527
From:
Jason Diamond
Regional Lifecycle Manager
Western USA
Email:
Cell No.:
[email protected]
905 399 7055
CC: Brian Anderson, Brad Leidecker (CHC)
Subject: Membrane Replacement Agreement (MRA):
materials, off-site and on-site support
Proposal No.: 615771-2
Original Project No.: 500054
Plant
Data:
Please provide corrections if inaccurate
American Canyon WWTP – Municipal Sanitary Wastewater Treatment. 4 trains, each train with 11 x 16M cassettes with ZW500D 370ft2 membranes.
Initial Substantial Completion date: August 2002.
102
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 2 of 28 Proposal Provisos
This proposal has been issued based on the information provided by the customer and on information currently available to Veolia Water Technologies & Solutions at the time of proposal issuance. Any changes or discrepancies in site conditions, including but not limited to changes in system influent water characteristics, changes in environmental health and safety (EH&S) conditions, changes in the reissued state/provincial disposal system permit, changes in buyer financial standing, buyer requirements, or any other relevant change or discrepancy in the factual basis upon which this proposal was created may lead to changes in the offering, including but not limited to changes in pricing, guarantees, quoted specifications, or terms and conditions.
Confidential and Proprietary Information
The enclosed materials are considered proprietary property of Veolia Water Technologies & Solutions (Veolia). No assignments, either implied or expressed, of intellectual property rights, data, know how, trade secrets or licenses of use thereof are given. All information is provided exclusively to the addressee and agents of the addressee for the purposes of evaluation and is not to be reproduced or divulged to other parties, nor used for manufacture or other means, without the express written consent of Veolia. The acceptance of this document will be construed as an acceptance of the foregoing.
Trademarks
The following are trademarks of Veolia Water Technologies & Solutions and may be registered in one or more countries:
+100, ABMet, Absolute.Z, Absolute.Za, AccuSensor, AccuTrak, AccuTrak PLUS, ActNow, Acufeed, ALGAECAP, AmmCycle, Apogee, APPLICATIONS ATLAS, AquaFloc, AquaMax, Aquamite, Aquaplex, AquaSel, Aquatrex, Argo Analyzer, AutoSDI, BENCHMARK, Betz, BetzDearborn, BEV Rite, BioHealth, BioMate, BioPlus, BIOSCAN, Bio-Trol, Butaclean, Certified Plus, CheckPoint, ChemFeed, ChemSensor, ChemSure, CHEX, CleanBlade, CLOROMAT, CoalPlus, COMP-METER, COMP-RATE, COMS (Crude Overhead Monitoring System), Continuum, CopperTrol, CorrShield, CorTrol, Custom Clean, Custom Flo, Cyto3, DataGuard, DataPlus, DataPro, De:Odor, DELTAFLOW, DEOX, DeposiTrol, Desal, Dianodic, Dimetallic, Dispatch Restore, Durasan, DuraSlick, Durasolv, Duratherm, DusTreat, E-Cell, E-Cellerator, ELECTROMAT, Embreak, EndCor, EXACT, FACT-FINDER, Feedwater First, Ferrameen, Ferroquest, FilterMate, Fleet View, FloGard, Flotrex, Flotronics, FoamTrol, FoodPro, Fore4Sight, ForeSight, FRONTIER, FS CLEAN FLOW, FuelSolv, Full-Fit, G.T.M., GenGard, GEWaterSource, Glegg, Heat-Rate Pro, High Flow Z, HPC, HPD Process, HyperSperse, Hypure, Hytrex, InfoCalc, InfoScan, InfoTrac, InnovOx, InSight, IONICS, IONICS EDR 2020, IPER (Integrated Pump & Energy Recovery), iService, ISR (Integrated Solutions for Refining), JelCleer, KlarAid, Kleen, LayUp, Leak Trac, Leakwise, LEAPmbr, LEAPprimary, Learning Source, LOGIX, LoSALT, M-PAK, MACarrier, Mace, Max-Amine, MegaFlo, Membrex, MemChem, Memtrex, MerCURxE, MetClear, MiniWizard, MK-3, MOBILEFLOW, MobileRO, Modular Pro, ModuleTrac, MonitAll, Monitor, Monitor Plus, Monsal, MP-MBR, MULTIFLOW, Muni.Z, NEWater, NGC (Next Generation Cassette), Novus, NTBC (Non Thermal Brine Concentrator), OptiGuard, OptiSperse, OptiTherm, Osmo, Osmo PRO, Osmo Titan, Osmonics, Pacesetter, PaceSetter, Petroflo, Petromeen, pHlimPLUS, PICOPORE, PlantGuard, PolyFloc, PowerTreat, Predator, PRO E-Cell, Pro Elite, ProCare, Procera, ProChem, Proof Not Promises, ProPAK, ProShield, ProSolv, ProSweet, Purtrex, QSO (Quality System Optimization), QuickShip, RCC, RE:Sep, Rec-Oil, Recurrent, RediFeed, ReNEW, Renewell, Return on Environment, RMS (Rackless Modular System), ROSave.Z, SalesEdge, ScaleTrol, SeaPAK, SeaPRO, SeaSMART, Seasoft, SeaTECH, Selex, Sensicore, Sentinel, Sepa, Sevenbore, Shield, SIDTECH, SIEVERS, SmartScan, SoliSep, SolSet, Solus, Spec-Aid, Spectrus, SPLASH, Steamate, SteriSafe, Styrex, SUCROSOFT, SUCROTEST, Super Westchar, SuperStar, TFM (Thin Film Membrane), Therminator, Thermoflo, Titan RO, TLC, Tonkaflo, TraveLab, Trend, TruAir, TrueSense, TurboFlo, Turboline, Ultrafilic, UsedtoUseful, Vape-Sorber, VeriFeed, VersaFlo, Versamate, VICI (Virtual Intelligent Communication Interface), V-Star, WasteWizard, WATER FOR THE WORLD, Water Island, Water-Energy Nexus Game, WaterGenie, WaterNODE, WaterNOW, WaterPOINT, WellPro.Z, XPleat, YieldUp, Z-BOX, Z-MOD, Z-PAK, Z-POD, ZCore, ZeeBlok, ZeeLung, ZeeWeed, ZENON, and Z.Plex.
103
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 3 of 28 Table of Contents
1 Introduction...................................................................................................................4 2 Membrane Replacement Agreement ...........................................................................5 3 Veolia Scope & Price ....................................................................................................6 4 Material Description......................................................................................................8
4.1 Membrane Modules & Cassettes ..............................................................................8
4.2 Hardware ..................................................................................................................8
4.3 Cassette Refurbishment............................................................................................8
4.4 LEAPmbr Aeration Upgrade......................................................................................9 5 Veolia Support ..............................................................................................................9
5.1 Off-Site Support ........................................................................................................9
5.2 On-Site Technical Services.....................................................................................10 6 Delivery .......................................................................................................................11 7 ZeeWeed Configuration..............................................................................................13 8 Scope - American Canyon..........................................................................................13
8.1 Installation Preparation ...........................................................................................13
8.2 Installation...............................................................................................................14
8.3 Empty Shipping Frame Preparation ........................................................................15 9 Solution Design Notes................................................................................................16
9.1 Permits ...................................................................................................................16
9.2 Maintenance Notes for Replacement Membranes...................................................16
9.3 Technical ................................................................................................................17 10 Health & Safety ...........................................................................................................18 11 ZeeWeed Membrane Module Standard Warranty .....................................................20 12 Terms and Conditions of Sale ...................................................................................24 13 Signed Agreement......................................................................................................26 Attachment A ZW500D RX12 Fact Sheet ..............................................................................27 Attachment B LEAPmbr 16M Cassette .................................................................................28 104
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 4 of 28 1 Introduction
Veolia Water Technologies & Solutions is pleased to present this proposal to the City of American Canyon for a Membrane Replacement Agreement (MRA) for replacement and additional wastewater membranes at the American Canyon Wastewater Treatment Plant.
It is expected that American Canyon will require replacement and additional membranes within the next 5 years and that membrane replacement will be staggered, with one train replaced per replacement event.
Veolia will provide our latest wastewater membrane, the ZW500D RX12, with 430ft2 of surface area per membrane. See Attachment A for further product information.
The scope of this agreement will include the following:
ZW500D RX12 430ft2replacement and additional membranes; ZW500D 16M LEAPmbr cassettes;
ZW500D cassette refurbishment components – 16M;
Components and off-site support to upgrade existing cassettes to LEAPmbr aeration;
On-site membrane installation, cassette refurbishment and LEAPmbr upgrade assistance.
Details of the scope are set out in the sections below.
Veolia is a proven leader in delivering tangible value to our clients over the life of the plant.
Our measure of success is how well we deliver solutions that help our clients meet their critical business objectives. Benefits of this agreement include:
Timely lifecycle costs over the period of the agreement Planned membrane replacement
Through long-acquired membrane experience, Veolia has clearly distinguished itself from other membrane manufacturers. A mature service culture and deep technical expertise are at the ready to serve and support American Canyon through this next membrane lifecycle.
Veolia would like to note that under the current exceptional circumstances across global supply chains and logistics networks, Veolia may not be in a position to guarantee and comply with the planned schedule for product / project delivery or performance. Veolia reserves the right to modify the schedule / contract accordingly. Veolia will promptly inform you of any changes which may impact the contract.
105
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 5 of 28 2 Membrane Replacement Agreement
Through the term of this agreement, Veolia will provide a quantity of membranes to replace the existing full plant of ZW500D 370ft2 membranes, and additional membranes and cassettes to populate all existing cassette spaces at the American Canyon WWTP.
Based on the projected life of the current membranes and the planned start date of this agreement, Veolia anticipates the following replacement schedule*:
Agreement Year: 1 2 3 4 5 Total
370f2 membranes replaced 176 176 176 176 --- 704
430ft2 membranes provided 224 224 224 224 --- 896
*Through the term of this agreement, Veolia will work with American Canyon to determine the actual timing of replacement events based on plant performance and membrane condition, with the ultimate goal to maximize membrane life.
It is possible that, through virtue of good membrane management and plant operation, American Canyon may extend membrane life of the current membranes beyond the end date of this agreement. To avoid unnecessary premature replacement, American Canyon may choose to defer delivery of membranes into a future year provided that all membranes are received and accepted within a 3-year period following final billing for the agreement.
This membrane replacement agreement provides assurance to the City of American Canyon that over the course of the agreement, Veolia will provide the membrane modules specified or equivalent for use at the American Canyon WWTP.
For optimal economics and to follow best membrane replacement practices, pricing is based on replacing multiples of at least 1 train worth of membranes at a time. Should American Canyon request quantities other than a minimum of 1 full train per installation event over the term of this agreement, an adjustment to the annual invoice may be made to account for additional costs.
*Pricing is based on the proposed replacement schedule provided in the table above. If the actual shipment schedule is accelerated, additional cost/payments may be required. 106
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 6 of 28 3 Veolia Scope & Price
Veolia’s scope includes the material and services outlined in the table below. The sections that follow provide additional detail regarding each scope item.
Item Description Part # Quantity Price
ZW500D RX12 430ft2 membrane modules, section 4.1 3178087 3184788
3184265*
896
2,414,230
ZW500D LEAPmbr 16M cassette frames, section 4.1 12
2-year full replacement membrane warranty, section 11 Incl.
Cassette refurbishment and LEAPmbr upgrade,
sections 4.3 and 4.4 Incl.
Hardware, section 4.2 Lot
Estimated applicable tax on materials only (7.75%)** Incl. 186,793 Materials, including estimated applicable tax Sub-total 2,597,023 Off-site support, project management, section 5.1 Incl. 76,810 International shipment, fees, and duties, section 6 Incl. 260,937
Freight, DDP project site, section 6 3095534 Incl.
Off-site labor, delivery Sub-total 337,747
Materials, off-site labor, delivery Sub-total 2,934,770 On-site support – 2 x FSRs, each on site for a total of 36 x 10-hour days over 4 visits to site, plus travel &
living, section 5.2
135491 4 visits 186,560
On-site support Sub-total 186,560
All figures are in USD. Please make purchase order to ZENON Environmental Corporation.
Estimated taxes have been included, but tax rates applicable at time of invoicing will be used.
Total
Price 3,121,330
Annual payment 624,266
*Part numbers provided above represent modules shipping in 16M LEAPmbr cassette frames (3178087), 30M shipping frames (3184788), and loose bag & box (3184265). **Sales tax estimated at current rate of 7.75% for American Canyon, CA on materials as per http://www.cdtfa.ca.gov/taxes-and-fees/rates.aspx. Actual tax rate at time of invoicing will be added on all invoices.
Prices provided above for the total and annual fee are prior to annual inflation adjustments.
The annual fee is based on a proposed 5-year agreement duration starting in 2024, and will be subject to annual adjustments for inflation increases through the term of the agreement 107
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 7 of 28 based on changes in the US Consumer Price Index, all items in US city average, all urban consumers, not seasonally adjusted – series I.D. CUUR0000SA0.
Annual Adjustments:
Where Index-1A is the current month/year and Index-1B is the month/year 12 months prior. The index used will be the latest available at the time of each calculation – which will typically occur just prior to the start of each agreement year. Each adjustment will be applied to the annual fee in place at the time of each calculation.
In any instance of a reduction in the year-over-year inflation indexes, the annual invoice value will be held the same as the previous year.
The annual fee will be invoiced each year at the beginning of the period. Should the agreement be terminated for any reason, please see section 12 item 8.
Proposal Notes:
Price Review. Notwithstanding the terms set forth herein or of any agreement or acceptance of Seller’s quotation, Seller reserves the right at any time and from time to time by notice in writing to the Buyer to (a) determine periodic price reviews based on Goods’ raw material increase arising from currency devaluations (b) increase Prices (or impose temporary price adjustments) based on increases in the cost of base components for the Goods or Services provided, where the increase is due to increased global demand, limited supply, temporary product shortages, allocation of supply, or such other similar inflationary pressures; and (c) impose a surcharge equal to any increase in the cost of the Goods or Services as a result of a modification of exchange rates, duties, taxes or other levies imposed by public authorities.
Shipment/Collection Delays: The membrane sale will be subject to price adjustment if not collected within 1 month of Readiness for Shipment. After the one month of Readiness for Shipment if Purchaser does not send his agreement to receive or collect the membranes (depending on Incoterms), Seller is entitled to reallocate the membranes to another customer.
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Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 8 of 28 4 Material Description
The following materials are provided within Veolia’s scope of supply.
4.1 Membrane Modules & Cassettes
Veolia will provide 896 x ZeeWeed 500D 430ft² wastewater membrane modules Veolia will provide 12 x ZW500D 16M LEAPmbr cassettes. See Attachment B for further product information.
4.2 Hardware
160 x #118 EPDM permeate spigot o-rings;
40 x ZW500D element end cap keys;
12 x ZW500D blank header sets;
Hanging arms and leveling pins for 12 x new LEAPmbr cassettes; Permeate and aeration connections for 12 x new LEAPmbr cassettes; Safety hoist ring for new 16M LEAPmbr cassettes (1 set); Tees and CPVC elbows for combining cassette air line connections into one; 16 x o-ring lubricant (food grade);
8 x anti-seize lubricant (food grade).
4.3 Cassette Refurbishment
Veolia will supply components for refurbishment of 44 x existing 500D 16/16M cassettes, including spares.
Cassette refurbishment service allows you to fully recondition your cassettes at less cost than purchasing new cassettes. Cassettes will be refurbished at the American Canyon facility. Cassette refurbishment includes the following:
Removal of all existing plastic parts and associated hardware,; If slack adjustment has been completed on cassettes, return the cassette to the initial factory membrane slack position;
Installation of all new, current design parts (module mountings, securing mechanisms), and all associated hardware;
On-site cassette refurbishment service by trained Veolia field service representatives – details provided in sections 5.2 and 8.2. 109
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 9 of 28
4.4 LEAPmbr Aeration Upgrade
The 12 x new 16M cassettes provided will be configured with LEAPmbr aeration. Veolia will supply components to upgrade the existing 44 x ZW500D 16M cassettes to LEAPmbr aeration.
5 Veolia Support
5.1 Off-Site Support
Controls
Provide system controls programming adjustments as required for the new membranes including adjustment of set points for air flow and LEAPmbr aeration.
If there is a requirement for the EEPROM (Electrically Erasable Programmable Read-Only Memory) to be stored, a period of plant shutdown must be arranged by American Canyon.
Documentation
The base level of documentation updates will include field/hand markups of relevant electrical and P&ID drawings. These updates should be filed in the O&M manual as interim documentation. Following installation, Veolia will provide:
P&IDs - Update the process (piping) & instrumentation drawings and reissue electronically;
Controls documents – Update control narrative (CN), controls logic sequence chart (CLSC, also known as CSC) and the operation sequence chart (OSC).
Due to the very high cost of comprehensive updating of plant documentation with each system upgrade, Veolia recommends planning a complete documentation update every 1-4 years to coincide with a selected system upgrade.
Veolia will be pleased to develop a documentation update price quotation on request which may include some or all of the following scope according to its relevance:
O&M manual - Provide a fully updated version of the operation & maintenance manual that indicates the changes made with this membrane replacement upgrade; Electrical drawings – Update the electrical drawings and reissue electronically.
Project Management
Provide planning and off-site assistance during the membrane replacement project. 110
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 10 of 28
5.2 On-Site Technical Services
The proposal includes a provision for technical services during installation and commissioning process to support American Canyon’s staff as outlined in section 3. Please see section 8.2 for recommendations on the plant staff necessary to perform the work.
Installation and commissioning of membranes will be executed in a manner that minimizes down-time and returns the system to beneficial use in a timely manner.
The following activities will be completed jointly by plant staff and Veolia:
Remove existing membranes/cassettes;
Install cassette refurbishment and LEAPmbr aeration upgrade components; Install the new membrane modules/cassettes;
Upload required revisions to the PLC program with adjusted set-points; Perform bubble test where applicable to test membrane integrity and review trans membrane pressure (TMP) on the installed membranes and compare to expected values for new membranes; complete repairs/adjustments necessary to provide new membrane performance.
Operating Responsibility - American Canyon retains control of the work site and retains final responsibility for the installation and commissioning process.
Veolia will perform the services specified in the scope section of this document, but Veolia will not operate the system. For the purposes of this agreement, the term “operate the system” shall mean to run or control the functioning of the equipment or to otherwise conduct or manage the affairs of any aspect of water or wastewater treatment or other functions at American Canyon’s site, and shall include functions such as providing operators or laborers to adjust or control water treatment (“WT”) equipment, wastewater treatment (“WWT”) equipment or sludge management facilities (“SMF”), providing program oversight or directing on-site or contract operators/laborers to adjust or control WWT or SMF, providing personnel responsible for or providing oversight of water treatment residual quality, wastewater effluent quality, sludge quality, waste characterization, or waste disposal activities, or providing personnel with continual or daily operational responsibilities with respect to water or wastewater treatment, influent or effluent compliance monitoring, process monitoring, government reporting or notification, or permit compliance.
Waiting Time - Any overtime or waiting times required due to unforeseen site events outside the control of Veolia will be invoiced according to the prevailing Veolia service labor rates sheet, available on request.
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Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 11 of 28 Reporting - Before leaving site, Veolia will record observations and discuss with operators concerning the condition of the equipment, tasks accomplished during the visit, and key operating and maintenance issues requiring further attention. Veolia will provide a copy of a written report before leaving site and/or provide a service visit report to the plant operator within a reasonable timeframe of the Veolia service representative’s return to the office. In any case, American Canyon will be asked to sign a work order that describes the hours on site and tasks accomplished.
Veolia Duties for On-Site Services
Veolia will coordinate its work under this agreement in a reasonable manner with the operating staff of the facility.
Veolia will maintain public liability and property damage insurance covering all operations undertaken by Veolia and its sub-contractors with a limit of $5,000,000 inclusive for any one accident or occurrence. If for any reason additional insurance coverage (e.g. general construction/erection all risk, general liability) is required above and beyond Veolia’s standard insurance terms for on-site commissioning supervision, American Canyon must inform Veolia in writing 60 days prior to work commencement at site. American Canyon will be billed for all additional insurance costs and processing fees.
Veolia will maintain workers compensation and employers’ liability coverage as per statutory requirements.
6 Delivery
Freight
DDP - Delivery will be by standard ocean/ground on the basis of DDP American Canyon WWTP, or other named place of destination; Incoterms 2020. DDP = delivery duty paid. Partial shipments will be acceptable unless otherwise specified. Where delivery cannot be accepted at this destination, American Canyon shall specify an alternate, equivalent destination without delay.
Due to varying origins and availability, non-membrane items included in this proposal may be shipped separately from the membranes. Should separate shipments be required, where possible, Veolia will strive to provide these items on or before the delivery of the membranes.
Title & Risk - Title and risk of loss or damage to membrane modules, cassette frames, shipping frames, hardware and crating shall pass to American Canyon upon delivery at the named place of destination.
International Shipment, Fees, and Duties
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Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 12 of 28 Origin - Delivery of ZeeWeed membranes originates from the Veolia Water Hungary Kft, Bláthy Ottó u 4, Oroszlány, 2840 Hungary facility. Costs to transport membranes into North America are included in Veolia’s quoted price. Export Documents - All ZeeWeed membrane module shipments into the USA require clearance documentation from the EPA. Veolia will prepare and provide the required EPA documentation to the Carrier.
MPF - Merchandise processing fee is a fee assessed for formal custom entries based on 0.35% of the invoice value, with a minimum of USD $25 per formal entry and a maximum of USD $485. On the basis of DDP terms, this fee will be paid by Veolia within the quoted price.
Duty - A US Customs duty of 3.9% applies to all ZeeWeed membranes shipped individually or in shipping frames; not in operational cassette frames. On the basis of DDP terms, this duty will be paid by Veolia within the quoted price. Any new duty imposed after the date of this proposal is the responsibility of American Canyon.
Taxes - All applicable local, state, or federal taxes are the responsibility of American Canyon.
Temperature - UF membranes cannot be allowed to freeze or overheat and may require temperature-controlled freight and handling according to the season and the planned routing. If required, the price of temperature control will be included within the firm quote on freight by Veolia.
Packaging – Membranes will be delivered in a combination of operational cassette frames and shipping frames (factory installed), and individually bagged, boxed and crated.
Unloading - may require one of or a combination of a loading dock, extended forks and an experienced forklift driver at delivery destination. Please consult with Veolia at the time of purchase order (PO) preparation on this.
Shipping crate information (estimated) – per train
Qty Description Dimensions (in) Weight (lb)
3 ZW500D 16M cassettes L=107 x W=35 x H=80 1,421
4 ZW500D 30M shipping frames L=37 x W=89 x H=94 2,286
1 ZW500D 14M crate L=94 x W=74 x H=46 1,325
3 ZW500D 4M crate L=38 x W=93 x H=28 477
Notes:
● Only crates for membrane/cassette transport have been shown above to identify the largest and heaviest items that will need to be unloaded;
● Smaller crates/skids will be used for hardware items (hanger arms, spool connection components, etc.). 113
Veolia Confidential and Proprietary Information
Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 13 of 28 Handling – ZW500D 16M membrane cassette frames are shipped and will arrive on-site on their sides. An eye bolt kit, included in this proposal, should be used to safely turn the cassette(s) upright. Adequate work area and height and equipment will also be needed to be available to safely turn the cassettes upright for installation.
Availability – With current global logistics and freight delays we are experiencing significant increases in lead times. Definitive availability will be confirmed upon each request for membranes from American Canyon. Longer lead times should be taken into consideration in the course of membrane replacement planning. 7 ZeeWeed Configuration
Configuration Data Units Existing Plant
Configuration
Configuration After
Replacement &
Addition
Number of trains, plant 4 4
Type of ZeeWeed membrane 500D 500D
Module surface area ft² 370 430
Total number of cassette spaces per train 14 14
Maximum number of modules per cassette 16 16
Fully populated cassettes installed per train 11 14
Flex cassettes installed per train --- ---
Installed number of modules / flex cassette --- ---
Total module count, train 176 224
Total surface area in operation, train ft² 65,120 96,320 Total module count, plant 704 896
Total surface area in operation, plant ft² 260,450 385,580 % surface area change from existing, plant % --- 47.9%
8 Scope - American Canyon
8.1 Installation Preparation
Receive, off-load, handle and provide temperature-controlled storage of the equipment and materials required for Seller to perform the duties outlined in the Seller’s scope of supply. Prior to off-loading, Buyer to confirm temperature indicators have not been tripped.
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 14 of 28 Membranes must be stored in a sheltered area, protected from freezing, direct sunlight or extreme heat, and sealed as shipped until ready for use. Storage should be in a dark, dry, level area at a temperature of 5-30°C (41-86°F). Membranes have a shelf life of 1 year before requiring re-preservation and should not be stored longer than necessary prior to installation. American Canyon is responsible for risk of loss of Seller’s parts while in storage at the customer’s plant. Inspect, evaluate and make repairs as required for the membrane tanks, mounting brackets, hoses and all connections prior to Veolia arriving at site. Provide all access structures (such as scaffolding) and mechanical lifting equipment including cranes, forklifts and scissor lifts.
Assure availability of a copy of the operating manual, all process and instrumentation drawings, and all electrical drawings on site and accessible for reference.
Maintain adequate insurance coverage for the risks of fire, theft, vandalism, floods and personal injury to authorized or unauthorized visitors.
8.2 Installation
Provide at least 2 plant personnel to work continuously for the full duration of the Veolia site visit during installation and commissioning of the modules. Veolia recommends that the personnel be experienced with the ZeeWeed system. American Canyon will afford Seller’s personnel free access and egress of the facility for all authorized work. American Canyon will provide reasonable access to workshop facilities with standard workshop tools and equipment as is necessary to meet any repair and maintenance requirements of the system during installation.
American Canyon will provide Seller’s personnel reasonable access to the facility amenities, including washrooms and break rooms.
Provide adequate illumination and emergency lighting for all areas in which the Seller will be executing the scope of supply. Provide all site utilities such as raw water, instrument quality air, potable water and power required for operation of the proposed equipment included in this scope of supply. Assure that adequate quantities of membrane cleaning and neutralizing chemicals are on hand for wash procedures including sodium hypochlorite, sodium bisulphite, citric acid and sodium hydroxide. Supply telephone/fax/modem access while Seller’s staff members are on-site.
American Canyon will provide assistance to:
Remove cassettes from the system as required;
Clean each cassette as it is removed from the system; 115
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 15 of 28 Install cassette refurbishment and LEAPmbr upgrade components; Place new modules into each refurbished cassette;
Return the refurbished cassettes to the system;
Install new additional cassettes with hanging arms and permeate & aeration connections.
American Canyon will:
Dispose of all retired membrane modules and cassette components; Dispose of shipping and packaging materials unless specifically requested not to do so by Veolia;
Prepare shipping frames for return to Veolia, see section 8.3; Load shipping frames onto the truck for return to Veolia – Veolia will be responsible for organizing the logistics of delivery back to Veolia.
8.3 Empty Shipping Frame Preparation
All shipping frames returning to Veolia must be well cleaned and packaged appropriately for trans-oceanic transport in shipping containers. Shipping frames should be cleaned using high pressure washers and mounted on wood skids to facilitate moving them in and out of the freight containers. Veolia will provide American Canyon offsite assistance to facilitate the return of shipping frames.
All wooden packaging material used for international shipments must conform to current phytosanitary standards to reduce the risk of introduction and spread of quarantine pest species associated with the movement in international trade of wood packaging material made from raw wood.
All wood packaging material used to transport shipping frames internationally, must comply with ISPM15 which is the standard for phytosanitary measures and be properly stamped indicating compliance with the standard. Failure to comply with the standard may lead to shipment refusal and subsequent project delays. For detailed information on ISPM15 please visit the ISPM15 website.
Whenever possible, save and re-use the wooden skids that the shipping frames arrived on for return freight purposes.
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 16 of 28 9 Solution Design Notes
9.1 Permits
Regulatory Requirements
American Canyon is responsible to review and report to the permit granting agency on the impact of any of the proposed changes on the regulatory permit. Veolia will provide the necessary manufacturer’s technical support on regulatory issues.
Please speak with your regional lifecycle manager (RLM) if there are any regulatory requirements or concerns.
Utilization
Veolia understands that these modules are required as replacements for currently installed modules, and additional modules to fill existing spaces.
These modules are offered on the basis that the membrane modules will not be used to provide expanded flow beyond the current plant flow rating.
Replacing the current 704 x 370ft2 membranes with 704 x 430ft2 membranes provides a
16.2% surface area increase. Adding an additional 3 x 16M cassettes per train of ZW500D 430ft² modules brings the total surface area increase of the plant to 47.9%.
It is Veolia’s understanding that the cassette support system (beams and brackets) is already installed in the spare space. If this is not so, please advise Veolia and request that this be added to the proposal.
Production Interruption
During installation of the ZeeWeed cassettes, trains will be shut down which will affect American Canyon treatment capacity. After the purchase order is acknowledged, Veolia’s project manager for the installation will consult with American Canyon to jointly develop the installation plan and work schedule with due regard for membrane delivery to the plant and plant preparation.
9.2 Maintenance Notes for Replacement Membranes
At the time of any full plant or full train membrane replacement, it is recommended to evaluate whether it is the right time to address any tank coating repairs which may be required.
Preferential Flow
Mixing a small proportion of new modules in trains with large amounts of older modules is not recommended as it creates a risk of over-fluxing of new modules, which can shorten their lives. For ZW500D membranes, the mixing of old and new modules in the same cassette makes slack adjustment more difficult. Veolia recommends that American Canyon plan membrane module replacement on a complete cassette and complete train basis wherever possible to achieve both optimal performance and best value from the new 117
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 17 of 28 membrane modules. In this case, by replacing all membrane modules in the plant on a per train basis, this risk has been neutralized.
Membrane Slack
Veolia’s membranes are supplied and shipped with an initial factory fiber slack designed to optimize membrane air scouring during operation as well as accommodate a degree of shrinkage. Membranes shrink in length early in their lifecycle when exposed to higher temperature water. The pace of shrinkage slows with age. With the installation of new membranes, the requirements for slack adjustment start a new cycle.
Due to the wide variety of operating environments in which our products can be utilized, it is difficult to generally predict the rate of shrinkage. If membranes operate in a condition of insufficient slack for an extended period of time, irreversible damage to the fiber-urethane bond may occur. Please refer below to the recommended inspection frequencies based on your plant’s membrane tank operating temperature. Visual inspections should begin during the membrane installation and be repeated over time on the same cassette. Digital pictures will allow for comparative analysis of the fiber slack over time.
Maximum Operating Temperature Recommended Slack Inspection Frequency 0-24 °C / 32-76 °F every 2 years
25-30 °C / 77-86 °F once per year
>30 °C / > 86 °F twice per year
Bubble Test Pressure
The bubble test pressure for the purchased membranes is 2 psi horizontally and 3 psi vertically.
9.3 Technical
Module Upgrade – 370ft² vs 430ft²
Upgrading from the ZeeWeed 500D 370ft² module to ZeeWeed 500D 430ft² module offers the following advantages:
16.2% increase in membrane module surface area;
Increased membrane module surface area without any changes to the overall dimensions of the module;
No increase in chemicals for maintenance or recovery cleans due to increased surface area;
Improved membrane chemistry that allows for greater permeate productivity per square foot of membrane area without impacting water quality. 118
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 18 of 28 Other Considerations
Hoses & Fittings
Veolia has assumed for this proposal that the aeration and permeate cassette connections for the ZW500D cassettes currently in operation do not need replacing at this time. If this is not so, please advise Veolia and request that they be added to this proposal.
Blowers
For the purposes of this proposal, the range of blower capacity has been assumed to be adequate for this upgrade.
Should resheaving parts be required they can be supplied by Veolia at additional cost to American Canyon or alternatively Veolia will assist in specifying the needed components.
Mechanical and electrical adjustments required to meet new air flow will be completed by American Canyon or their 3rd party designate. Veolia will provide American Canyon correct air flow requirements for the new plant configuration.
Pre-Screen
Trash and non-biodegradable solids, such as hair, lint, grit and plastics may foul or damage the membranes if allowed to pass into the membrane chamber. Veolia recommends that an internally-fed screen with mesh or punched-hole openings less than or equal to 2 mm with no possibility of bypass or carryover be operated upstream of the new membranes to ensure effective operation and to maximize membrane life. 10 Health & Safety
American Canyon
American Canyon will provide orientation to Seller’s personnel to ensure sitespecific safety protocols are known. American Canyon will identify and inform Seller’s personnel of any site-specific hazards present in the workplace that could impact the delivery of Seller’s scope of supply and agrees to work with Seller to remove, monitor, and control the hazards to a practical level. American Canyon will provide any site-specific or standard company operating procedures and practices for Seller’s personnel to perform work on site, if required by American Canyon’s policies. Such programs may include, but are not limited to, general environmental health & safety (EHS), HAZOP, fire protection, drug testing, incident notice, site conduct, standard first aid, chemical receiving, electrical safety, etc. American Canyon will provide a certificate of program completion for Seller’s personnel. This program will be fully documented, training materials will be provided, and attendance list will be kept.
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 19 of 28 If any type of lifting devices will be used on site, American Canyon will provide proof of its maintenance, inspection and certification documentation upon request and will assist the Veolia service representative to complete a safety inspection checklist. Where confined space entry may be required, American Canyon will provide early notice and will collaborate with Veolia in planning adequate staffing and in advising the local fire/rescue department as required.
No time or cost provision has been made for preparations such as safety record clearances, drug testing, insurance confirmations or pre-job-training in excess of 1 hour. Prior to finalizing the Purchase Order and the work schedule, American Canyon will advise Veolia of any pre-job or pre-mobilization requirements. Where these requirements exceed 1 hour, this time will be charged to American Canyon at rates set out in the prevailing Veolia labor rate sheet. Where certain short duration activities require two people for safety and the Veolia Service representative is alone at site, American Canyon will cooperate as required to assure that correct safety precautions are taken.
American Canyon is responsible for the following environmental provisions:
Environmental use and discharge permits for all chemicals at American Canyon’s facility either listed in this document or proposed for use at a later date;
Any special permits required for Seller’s or American Canyon’s employees to perform work related to the water treatment system at the facility; All site testing, including soil, ground and surface water, air emissions, etc.; Disposal of all solid and liquid waste from the Seller’s system including waste materials generated during construction, start up and operation. American Canyon is responsible for provision of health and safety facilities to Seller’s field service representatives to the same extent that they are provided to American Canyon’s own employees, including provision of:
Eyewash and safety showers in the water treatment area; Chemical spill response;
Security and fire protection systems per local codes.
Veolia
All work on site will be performed in accordance with applicable law and will be performed reasonably, in a clean and safe manner. The Veolia service representative will abide by the more stringent of the applicable health, safety and environmental policies and procedures of either American Canyon or Veolia. 120
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 20 of 28 Veolia will provide all applicable safety training required by Veolia policies or by state or national health and safety regulations. The Veolia service representative will have undergone workplace hazardous material information system (WHMIS) training and will come equipped with necessary personal protective equipment (PPE).
Emergencies - In emergencies affecting the safety of persons, work or property at the site and adjacent thereto, Veolia will act, without previous instructions from American Canyon, as the situation warrants. Veolia will notify American Canyon immediately thereafter.
11 ZeeWeed Membrane Module Standard
Warranty
This schedule sets out the warranty with respect to ZeeWeed membrane modules (“membrane modules”). No other warranties, expressed or implied are made in connection with the sale of these products, including, without limitation, warranties as to fitness for any purpose or use or merchantability of these products. The warranty provided herein will be the exclusive and sole remedy of Buyer. This warranty is not transferable.
Definitions
The follow terms shall have the meaning set forth below when used in the warranty document:
a. “Buyer” means the party purchasing the ZeeWeed Modules from the Seller b. “Seller” means a business component of, or legal entity within the Veolia Water Technologies & Solutions business which is selling the ZeeWeed membranes.
2. Warranty Product
This warranty applies to only the membrane modules supplied under the contract of sale.
Membrane module means the hollow fiber ultrafiltration membranes and the potted plastic headers. This warranty does not cover air piping to the membrane module, permeate piping from the membrane module, piping connection fittings, connecting hardware and cassette frames with their associated components including but not limited to spacers, aerator tubes, aerator assemblies, screen, module dummies or module blanks.
3. Scope of Warranty
The Seller warrants that its membrane module(s) will be free of defects due to faulty materials or errors in manufacturing workmanship.
Regular membrane module inspection and normal fiber repair shall be the responsibility of Buyer.
All replacement membrane modules will be shipped on the basis of INCOTERMS 2020 FCA Veolia manufacturing facility.
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 21 of 28 All ancillary costs including but not limited to bagging, boxing, crating, freight, freight insurance, applicable taxes, import duties, certifications, brokerage, receiving, forklift services, storage at site, reattachment hardware, hose/clamp/camlock replacement, crane services, installation, fiber repair materials, glycerin flushing, commissioning and waste disposal are the responsibility of Buyer.
4. Warranty Start Date
Membrane warranty will start on the earlier of:
a. The date that installation of the original membrane module(s) has been substantially completed, or
b. Three (3) months from the date of delivery of the original membrane module(s) to Buyer.
5. Warranty Duration
Total Warranty Duration: a total of 24 months of full replacement warranty coverage.
6. Notification Of Claim
All claims filed under this warranty shall be made in writing by Buyer within 30 days of identifying a defect.
Buyer shall provide the following information:
a. A description of the defect giving rise to the claim; b. Photographs showing the manufacturing defect;
c. The serial number(s) of the membrane module(s) which is (are) the subject of the warranty claim; and
d. Operating data and repair history for the life of membrane modules which are the subject of a warranty claim.
7. Verification of Claim
After receipt of written notification of a defect, the Seller will promptly undertake such investigations as, in the Seller's opinion, are necessary to verify whether a defect exists. The Seller reserves the right to require additional data as necessary to validate claims. Buyer may, in the course of these investigations, be requested to return membrane module(s) to the Seller for examination (see item 11). The Seller may also conduct reasonable tests and inspections at Buyer’s plant or premises. If the results of the investigation do not validate the defect claimed, Buyer will reimburse the Seller for all reasonable expenses associated with said investigation, including expenses for all tests, inspections, and associated travel.
8. Satisfaction of Claims
The Seller will have the right to satisfy claims under this warranty in a flexible manner. Such flexibility may include the repair of existing membrane modules or changes in operating protocols or membrane module replacement or by upgrading failed membrane modules with newer membrane module(s) that may embody design and efficiency improvements. Buyer consents to the supply of replacement membrane modules which may be of a different design than original membrane modules.
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 22 of 28
9. Operating Information
To maintain the membrane module warranty, membrane system operation records from initial startup date until claim must be maintained by Buyer and made available to the Seller upon request.
Records must be provided in sufficient detail as applicable to verify the subject of a warranty claim and can include but is not limited to, operation data including information on feed water quality, temperatures, flows, trans-membrane pressures, aeration rates, permeate quality, cleaning intervals, cleaning chemical concentrations, elapsed time since start-up, relevant analytical data and reporting of any screen bypass events.
Buyer shall maintain and share access to a single reference copy in electronic form of a membrane module map containing the history of activity by membrane module and the serial number for each module. Buyer shall log its procedures performed related to a membrane module including relocation of membrane modules, repairs, replacements and any other noteworthy events.
Buyer authorizes the Seller to conduct any reasonable review of operation and maintenance records or to inspect facilities where membrane modules are installed, upon reasonable notice to Buyer. Such reviews and/or inspections are intended to also assist the Seller and Buyer in detection of membrane system faults and to optimize the care and operation of the membrane modules.
10.Limitation of Warranties
Occurrence of any of the following as reasonably determined by the Seller will void this warranty:
a. A material failure to operate the membrane system in accordance with Seller’s operations and maintenance manual supplied to Buyer as part of the contract, including material failure to adhere to the Seller’s specified membrane module cleaning procedures and the use of anything other than Seller-approved membrane module cleaning agents. b. Failure to adhere to the preventive maintenance program as presented in the Seller’s operations and maintenance manual, in published product manuals and in specifications. c. Failure to adhere to all transportation and storage requirements. ZeeWeed membrane modules may be stored up to 12 months from date of receipt and must be transported and stored in original intact packaging out of direct sunlight in ambient temperatures between 5- 35 Degrees Celsius. Storage beyond 12 months from date of receipt requires a written request to Veolia to maintain membrane module warranties. d. Introduction of destructive foreign materials and chemical agents into the membrane module.
e. Failure to maintain and provide system operating data and repair history for the life of membrane modules which are the subject of a warranty claim. f. Physical abuse or misuse, incorrect removal or installation of membrane modules by nonSeller personnel including fiber damage caused by operator error in handling of membrane modules or cassettes.
g. Unauthorized alteration of any components or parts originally supplied by the Seller. h. Intentional damage.
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 23 of 28
11.Return Procedure
In the event that the return of a membrane module is required pursuant to this warranty, Buyer will first obtain a Return Goods Authorization (RGA) number from the Seller. Membrane module(s) shipped to the Seller for warranty examination must be shipped freight prepaid in environmentally controlled freight and storage with ambient air temperature between 5-35 degree Celsius. If Buyer desires temporary replacement membrane module(s) to replace those alleged to be defective and returned to the Seller for warranty examination, Buyer shall be responsible for the cost associated with any such replacements until examination of the returned membrane modules pursuant to this warranty is complete. Any membrane module examined by Seller as part of a warranty claim where the membrane module is subsequently found to be performing as warranted or where a membrane module failure is not covered under the warranty will be returned to Buyer, freight collect or disposed of by Seller and the cost associated with any membrane analysis and diagnostic work will be levied against the Buyer based on Veolia standard labor rates.
12.Disclaimer and Limitation on Liability
To the maximum extent permitted by law, in no event shall Seller be liable for any loss of profit or revenues, loss of production, loss of use of equipment or services or any associated equipment, interruption of business, cost of capital, cost of replacement water or power, downtime costs, increased operating costs, claims of Buyer’s customers for such damages, or for any special, consequential, incidental, indirect, punitive or exemplary damages arising out of or relating to the performance or actual or alleged breach of the agreement, regardless of whether a claim is based in contract (including warranty or indemnity), extra-contractual liability, tort (including negligence or strict liability), statute, equity or any other legal theory. 124
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 24 of 28 12 Terms and Conditions of Sale
A - Specific Terms and Conditions of Sale
These terms take precedence over the general terms and conditions of sale. 1 Legal Entity for Contracting
ZENON Environmental Corporation is the name of the Seller, and means a business component of, or legal entity within the Veolia Water Technologies & Solutions business (Veolia).
Please advise us if this Veolia entity is not set up in your purchasing system as a vendor and you do have another Veolia entity set up. We are keen to make the purchase process as convenient as possible for American Canyon. short form: Where a short reference is required in this document, for convenience, we are called simply Veolia. 2 Payment
Veolia prefers to receive payment by wire transfer and will also accept payment by courier check.
Wire transfer information for ZENON Environmental Corporation send details to: SHD WATS REMIT-NAM [email protected] Bank of America Merrill Lynch
C/O ZENON Environmental Corporation
901 Main Street Dallas, TX 75202
ACCT# 4426318136
ABA# 026009593
SWIFT# BOFAUS3N
ACH# 111000012
3 Payment Terms
On approved credit, payment terms are net 30 days from customer receipt of invoice. Please see the invoicing schedule in the price section. In the event an invoice is issued on shipment of goods from a Veolia Hungarian production facility, payment terms will be extended by an additional 45 days to account for the additional transit time to the delivery location. 4 Proposal Validity
Prices quoted and proposal terms are valid up to thirty (30) days after the date of issue of this proposal unless confirmed with a purchase order.
5 Bonds
Performance or payment bonds are not included in the price. These can be purchased on request but will be at an additional cost. 6 Assignment of Membrane Warranty
The Buyer will be entitled to assign to a subsequent owner of the membranes the warranties of the Seller under this Agreement, provided that a prior written notification is sent to the Seller and the assignment agreement contains terms and conditions which provide the Seller with the protections of the warranties and limitations on liability contained in the Agreement. Subject to Buyer’s compliance with the foregoing requirement, such warranty rights are expressly assignable by the Buyer to a subsequent owner of the membranes. Except as provided herein, Buyer is not entitled to extend or transfer this warranty to any other party. 7 Flight Booking
Prices quoted for installation which include airfare are either based on timely confirmation of a visit schedule or based on receipt of a purchase order in time to book any flights seven days in advance. Additional airfare charges related to late arrival of a purchase order will be extra and billed through to American Canyon without mark-up. 125
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 25 of 28 8 Early Termination
In the event of contract termination other than as defined in attachment a.15 of this agreement the following will apply:
Veolia will initiate delivery of all materials and services for which payment has been received in excess of the value of materials and services provided by Veolia at the time of cancelation. Buyer will, within 30 days, make a payment to Veolia equal to the value of materials and services provided to the point of termination, less the cumulative sum of payments paid by Buyer. Once terminated, there is no option to restart the agreement. No penalties or reimbursements, other than those outlined in this agreement, shall be paid by either party 9 Warranty on Programming
Veolia warrants that the PLC program will conform to the specifications in the relevant sections of the CLSC and OSC (revised for the project) and will be free from defects in workmanship when operated at all times in accordance with Veolia’s written instructions.
If any defects are found and reported by American Canyon within a period not exceeding twelve (12) months beyond the completion of the site acceptance test, Veolia will make modifications to the PLC code as deemed necessary. Any changes requested by American Canyon after this period will be at the customer’s expense. 10 Purchase Order Guidelines
Please confirm that your purchase order has covered the following points. This will ensure accurate and prompt order entry, product delivery, invoicing and accounts receivables processing and will prevent administrative delays for all parties. Documentation – Our strong preference is to receive a hard or digital copy of your purchase order (PO) rather than a PO number alone. Your PO can be sent by email to [email protected]. If you are not able to provide a PO, please contact us for alternatives.
Veolia legal entity – Please be sure your purchase order is issued in the name of the specific Veolia legal entity outlined in the quote. We will be glad to work with your purchasing department to set this entity up as an approved supplier/vendor. Please advise us if this Veolia entity is not set up in your purchasing system as a vendor and you do have another Veolia entity set up.
Quotation Number – Please reference the quotation number in your PO. Product – Please note which product(s) you wish to purchase along with the quoted price, particularly if quantities or scope differ from the quotation.
Taxes – Please provide any required tax exemption certificates. Please indicate if taxes have been added in your PO. Payment Terms – Please acknowledge the payment terms included with the quotation. Bill-to Address – Please include contact information for your accounts payable. Ship-to Address – Please clearly define the delivery location and the receiver’s email & telephone. Please specify receiving hours and any special off-loading requirements. Delivery Date – Please include your requested delivery date.
B – General Terms and Conditions of Sale
The purchase of materials and service support included with this offer will be governed by the prevailing CITY OF AMERICAN CANYON AGREEMENT NO. 2024-59 – STANDARD AGREEMENT FOR INDEPENDENT CONTRACTOR SERVICES, executed between American Canyon and ZENON Environmental Corporation on May 8, 2024.
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 26 of 28 13 Signed Agreement
Through the issue of this proposal, Veolia signals their intent to enter into an agreement with American Canyon. American Canyon and Veolia acknowledge that they have read and understood this agreement and agree to be bound by the terms and conditions specified in it.
Offered by
Legal Entity:
ZENON Environmental
Corporation, also known as
Veolia or Seller
3600 Horizon Blvd.,
Trevose, PA, 19053
Accepted
by Legal
Entity:
The City of American Canyon, also
known as American Canyon or
Buyer
Authorized
Signature
by:
Title:
Signature
Date:
Signature: x
Purchase Order No:
If options were available,
which options selected
Upon acceptance of this proposal, please forward the following either
• by email with .pdf attachments or • by postal mail.
1) this signature page completed
to:
2) a hard copy of your purchase order, and
3) any required tax exemption certificates
[email protected]
or
Veolia Water Technologies &
Solutions
attention: Contracts Administrator
Please contact
[email protected]
for correct address
This agreement comes into force when Veolia has issued a formal acceptance of American Canyon’s Purchase order or formal acceptance of this American Canyon signed agreement.
Doc. control: Author: JE Filename: American Canyon WWTP 615771-2 MRA Sep-24 2024 Last modified: 9/26/2024 3:31 PM Commercial review: JD DOA: Blkt 127
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 27 of 28 Attachment A ZW500D RX12 Fact Sheet
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Membrane Replacement Agreement for the American Canyon WWTP Proposal number 615771 – revision #2 – September 24, 2024 Page 28 of 28 Attachment B LEAPmbr 16M Cassette
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CITY COUNCIL AGENDA
OCTOBER 15, 2024
STAFF REPORT
PUBLIC HEARING
ITEM NUMBER: 13.
TITLE
City Council Code of Conduct and Governance Protocols
RECOMMENDATION
Waive first reading and introduce by -tle only an ordinance modifying American Canyon Municipal Code Chapter 2.04.050 "Adop-on of procedures." to establish a City Council Code of Conduct and Governance Protocols.
CONTACT
Jason Holley, City Manager
Taresa Geilfuss, City Clerk
Mark Joseph, Governance Ad-Hoc Subcommittee Member
David Oro, Governance Ad-Hoc Subcommittee Member
BACKGROUND & ANALYSIS
The City Council Code of Conduct and Governance Protocol was first established in 2007 and most recently updated in 2021.
The City Council appointed an Ad-Hoc Commi9ee (Oro/Joseph) to prepare a new version of the document. The Council reviewed dra= versions of the document at your September 3 and October 1 meetings. Based on Council input, an updated version is included as Attachment 1, Ex. A.
The Code and Protocol is designed to establish standards of behavior and operational procedures for council members, ensuring transparency, accountability, and ethical governance. Its primary purpose is to foster a professional and respec@ul environment, guiding council members in their interactions with each other, city staff, and the public.
The Code and Protocol outlines expectations for ethical conduct, including integrity, impartiality, and adherence to legal and procedural norms. Governance protocols cover mee-ng procedures, decision-making processes, and public engagement strategies, aiming to enhance the efficiency and effec-veness of municipal opera-ons. By seCng clear standards and procedures, it helps maintain public trust and promotes a collaborative and responsible approach to local government.
The main document provides a summary of issues, while several lengthy and substan-ve appendices 130
issue by 3rd parties such as the FPPC, CalCities, etc. provide more detailed information.
Staff recommends adop-on of the Ordinance shown in A9achment 1. Future changes to the Code and Protocol may occur by minute order, resolu-on or ordinance, depending upon the nature of the change.
Lastly, although Members will consider ma9ers related to the former American Canyon County Water District (“Water District”) from -me to -me, they will cease to receive addi-onal compensa-on. The City Manager and City A9orney will bring a separate Ordinance for City Council review to implement this policy decision.
COUNCIL PRIORITY PROGRAMS AND PROJECTS
Organizational Effectiveness: "Deliver exemplary government services."
FISCAL IMPACT
Not applicable
ENVIRONMENTAL REVIEW
15378(b) - The ac-on is not a "Project" subject to the California Environmental Quality Act ("CEQA") because it does not qualify as a "Project" under Public Resources Code Sec-ons 21065 and 21080 and in Section 15378(b) of Title 14 of the California Code of Regulations.
ATTACHMENTS:
1. Ordinance
2. Exhibit A - Code and Protocols with Appendices
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ORDINANCE NO. 2024 -____
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF AMERICAN CANYON REPEALING AND REPLACING AMERICAN CANYON MUNICIPAL CODE CHAPTER 2.04.050 AND ESTABLISHING A CITY
COUNCIL CODE OF CONDUCT AND GOVERNANCE PROTOCOL
WHEREAS, the City Council Code of Conduct and Governance Protocol (Code and Protocol) was first established in 2007 and most recently updated in 2021; and WHEREAS, the Code and Protocol is designed to establish standards of behavior and operational procedures for council members, ensuring transparency, accountability, and ethical governance. Its primary purpose is to foster a professional and respectful environment, guiding council members in their interactions with each other, city staff, and the public; and WHEREAS, the Code and Protocol outlines expectations for ethical conduct, including integrity, impartiality, and adherence to legal and procedural norms; and WHEREAS, the Code and Protocol outlines meeting procedures, decision-making processes, and public engagement strategies, aiming to enhance the efficiency and effectiveness of municipal operations WHEREAS, the Code and Protocol maintains the public trust and promotes a collaborative and responsible approach to local government.
NOW, THEREFORE THE CITY COUNCIL OF THE CITY OF AMERICAN CANYON DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1: All prior versions of the City Council Code of Conduct and Governance Protocols are hereby rescinded and replaced with that certain City Council Code of Conduct and Governance Protocols - including Appendices A - H - attached hereto as Exhibit A.
SECTION 2: The City Council Code of Conduct and Governance Protocols may only be revised by ordinance, however any of the Appendices A – H may be revised by future City Council Minute Order or Resolution.
SECTION 3: The City Clerk, City Manager and City Attorney shall keep an updated copies of Council Code of Conduct and Governance Protocols - including Appendices A - H, and copies shall be distributed to new Council Members upon their election or appointment to City Council.
SECTION 4: All City Council Members shall acknowledge receipt of the Council Code of Conduct and Governance Protocols and agree to follow the Code of Conduct.
SECTION 5: American Canyon Municipal Code Chapter 2.04.050 shall be repealed and replaced by the following:
2.04.050 Adoption of procedures.
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The council shall follow the most current version of City Council Code of Conduct and Governance Protocols on file with the City Clerk to establish rules of procedure to govern the conduct of its meetings, any of its other functions and activities, and regulations pertaining thereto.
The City Council Code of Conduct and Governance Protocols may only be revised by ordinance, however any of the appendices created by 3rd parties may be updated with the latest information upon approval of a City Council Minute Order.
SECTION 6: The Ordinance shall become effective 30 days after its adoption.
The foregoing Ordinance was introduced at a regular meeting of the City Council of the City of American Canyon, State of California, held on the 15th day of October, 2024 by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
The foregoing Ordinance was adopted at a regular meeting of the City Council of the City of American Canyon, State of California, held on the _________ day of ____________, ______, by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
_____________________________
Leon Garcia, Mayor
ATTEST: APPROVED AS TO FORM:
_______________________________ ___________________________ Taresa Geilfuss, CMC, City Clerk William D. Ross, City Attorney 133
CITY COUNCIL
CODE OF CONDUCT
AND
GOVERNANCE
PROTOCOLS
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Code of Conduct and Governance Protocols Page 2 Rev 11/19/24 Contents
PREFACE................................................................................................................................ 3 INTRODUCTION..................................................................................................................... 4 Purpose ....................................................................................................................................... 4 Relationship between “Code and Protocols” and City Council “Policies”.................................. 4 Future Changes........................................................................................................................... 4 SECTION ONE: AMERICAN CANYON’S VISION, MISSION, AND VALUES.................................... 5 Our Vision.................................................................................................................................... 5 Our Mission................................................................................................................................. 5 Our Core Values – How We Do Business.................................................................................... 6 Our Strategic Values – How We Get Things Done...................................................................... 6 SECTION TWO: CODE OF CONDUCT........................................................................................ 7 Code of Conduct ......................................................................................................................... 7 Implementation, Compliance and Enforcement ...................................................................... 10 Statement Of Commitment ...................................................................................................... 10 SECTION THREE: ROLES, RESPONSIBILITIES AND RELATIONSHIPS.......................................... 11 City Council Roles and Responsibilities..................................................................................... 11 City Council Relationships......................................................................................................... 12 SECTION FOUR: GOVERNANCE............................................................................................ 15 Goals, Strategies and Key Initiatives......................................................................................... 15 Budgeting with Limited Resources ........................................................................................... 16 Ensure Accountability and Tracking Progress........................................................................... 16 Council Committees.................................................................................................................. 17 SECTION FIVE: MEETINGS .................................................................................................... 19 What is a “Public Meeting” (aka the “Brown Act”)?................................................................. 19 City Council Meetings............................................................................................................... 20 Closed Session........................................................................................................................... 23 Open Session............................................................................................................................. 24 SECTION SIX: COMPENSATION............................................................................................. 27 SECTION SEVEN: ADMINISTRATIVE SUPPORT ....................................................................... 28 135
Code of Conduct and Governance Protocols Page 3 Rev 11/19/24
PREFACE
As this Code of Conduct and Governance Protocols (Code and Protocols) is read, it is hoped that a general philosophy of governance emerges: the public good is best served when the City Council and staff work together as a team; when they understand their roles and responsibilities; and when all sides understand that there is rarely a single right answer—often there is a continuum of options, from one extreme to the other. The City Council’s job, with input from staff, stakeholders and the public, is to decide where to land on that continuum.
This Code and Protocols is intended to apply to elected officials (i.e. City Council Members) as well as all City Council-appointees to boards, commissions and committees. The term “Council Member” or “Member” as used herein shall be construed to apply individually to Council Members and City Council-appointees. The term “City Council” as used herein shall be construed to apply collectively to the City Council and City boards, commissions and committees, as appropriate.
As the American Canyon Fire Protection District Board is a separate and distinct legal entity, this governance protocol does not apply to the Fire District Board. 136
Code of Conduct and Governance Protocols Page 4 Rev 11/19/24
INTRODUCTION
Purpose
This Code of Conduct and Governance Protocols (Code and Protocols) serves four specific and important goals:
Reflect Governance Philosophy. Articulate the City Council’s philosophy on governance, including its code of conduct, roles, responsibilities, and relationships, and how it conducts its business.
Commitment to Transparency. Ensure that the public can easily review and compare the City Council’s actions with its stated protocols and policies, demonstrating a commitment to transparency.
Training and Guidance. Serve as a training tool and guidance for new Council Members and serve as a reference document for the entire City Council when deliberating on current issues.
Basis for Review and Revision. Provide for future review and revisions, allowing future City Councils to examine these protocols and adapt them to evolving conditions.
Relationship between “Code and Protocols” and City Council “Policies”.
The Code and Protocols detail how the City Council governs and performs its duties as elected officials – essentially, “how the City Council collectively conducts business” and “how Council Members individually conduct themselves.”
In contrast, City Council “Policies” outline the entire City Council’s positions on various issues, from finance to customer service to economic development. An example list of common Policies is shown in the Appendix.
While the Code and Protocols are expected to remain consistent over time, they can be amended as necessary. City Council Policies, however, are expected to evolve more regularly in response to changing circumstances.
City Council Policies are further distinguished from Administrative Policies and Procedures which are proffered by the City Manager and not subject to City Council approval, provided they are consistent with the City Council’s protocols and policies.
Future Changes
The Code and Protocols are adopted by Ordinance and incorporated into the American Canyon Municipal Code (ACMC). They may be modified according to the process established by the Ordinance.
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Code of Conduct and Governance Protocols Page 5 Rev 11/19/24 SECTION ONE: AMERICAN CANYON’S VISION, MISSION, AND VALUES American Canyon’s Vision, Mission and Values listed below were adopted by the City Council in 2013, after two years of community engagement. The City Council reconfirmed the Mission, Vision and Values in 2022 and 2023. The Community will change as it grows, and every 5-10 years, the City Council should re-examine the Vision, Mission and Values.
Our Vision.
The Vision Statement expresses future desire. It reflects what the Community wants to become. This Vision drives the work the City of American Canyon does, guides how business is done, and informs the priorities pursued.
Our Mission.
The Mission Statement expresses the purpose of the primary organization supporting the Community’s Vision, namely the City of American Canyon. It fundamentally defines what the organization stands for and what we do.
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Code of Conduct and Governance Protocols Page 6 Rev 11/19/24 The following core and strategic values express how the Community expects to be served by the City of American Canyon.
Our Core Values – How We Do Business
Fiscal Responsibility. We manage our resources wisely to ensure long-term financial stability and sustainability. Our decisions are driven by careful planning and prudent management to achieve optimal outcomes for our stakeholders.
Professional Excellence. We strive for the highest standards in our work, continuously improving our skills and knowledge. Our commitment to excellence ensures that we deliver superior results in every endeavor.
Transparency & Accountability. We operate with openness, providing clear and honest communication. We hold ourselves accountable for our actions, ensuring that our stakeholders can trust our processes and outcomes.
Customer Focus. Our customers are at the heart of everything we do. We are dedicated to understanding their needs and exceeding their expectations through exceptional service and innovative solutions.
Integrity. We conduct our business with the utmost honesty and ethical standards. Integrity guides our decisions and actions, fostering trust and respect with our clients, partners, and community.
Our Strategic Values – How We Get Things Done
Creativity and Innovation. We encourage creative thinking and embrace innovative solutions to stay ahead in a dynamic environment. Our culture of innovation drives us to explore new possibilities and improve our services continually.
Collaboration and Teamwork. We believe in the power of working together. By fostering a collaborative environment, we leverage diverse perspectives and talents to achieve our goals and deliver exceptional results.
Leadership. We lead by example, inspiring others through our actions and decisions. Our leadership is characterized by vision, courage, and a commitment to doing what is right.
Community Engagement. We actively engage with our community, building strong relationships and contributing positively to society. Our community involvement reflects our dedication to social responsibility and collective progress.
Results Oriented. We focus on delivering tangible results that drive success. Our approach is disciplined and goal-driven, ensuring that we achieve our objectives efficiently and effectively. 139
Code of Conduct and Governance Protocols Page 7 Rev 11/19/24 SECTION TWO: CODE OF CONDUCT
Code of Conduct
To promote equitable, principled, and responsible governance at the local level, the City of American Canyon adopts the following Code of Conduct for Council Members:
1) Comply with the Law – City Council Members shall adhere to the legal requirements of the United States of America, the State of California, and the City of American Canyon while carrying out their official responsibilities. These requirements encompass, among other things, the United States and California Constitutions, laws and regulations pertaining to conflicts of interest, election campaigns, financial disclosures, employer obligations, and transparent government processes as well as city ordinances and policies. Members shall comply with both the explicit rules and the underlying principles of governmental operations. 2) Act in the Public Interest - The foremost responsibility of individuals representing American Canyon is the public interest. City Council Members shall prioritize the collective welfare of the community over any personal or private concerns. They will ensure equitable and impartial treatment for all individuals, claims, and matters presented to the City Council. 3) Personal Conduct – City Council Members must maintain the highest standards of professional and personal conduct, steering clear of any actions that might be seen as improper. They should abstain from engaging in abusive behavior, making personal accusations, or launching verbal assaults on the character or intentions of fellow Members, staff, or the public. As esteemed community representatives, Members are expected to exhibit a personal and professional demeanor that enhances the reputation of the legislative body and reflects positively on the entire City. Public office shall be used for the betterment of the community, rather than personal enrichment.
4) Respect for Process – City Council Members will perform their duties in accordance with the processes and rules of order established by the City Council governing the deliberation of public policy issues, meaningful involvement of the public, and implementation of policy decisions by City staff. The City Council acts as a collaborative decision-making body. Once the City Council, acting as a body, has reached a decision, individual Members will respect and support the collective decision, regardless of their individual vote on the matter. 5) Conduct During Public Meetings – City Council Members are prepared, listen courteously and attentively to all public discussions before the body, and focus on the business at hand.
Members shall refrain from interrupting other speakers, making personal comments not germane to the business of the body, or otherwise interfering with the orderly conduct of meetings. Public discussions and procedures shall be conducted transparently in an atmosphere of respect and courtesy. Members shall keep an open mind and consider all written and public testimony first, before making a decision. 140
Code of Conduct and Governance Protocols Page 8 Rev 11/19/24 6) Ethics Training – City Council Members shall participate in ethics training promptly after assuming office and periodic thereafter as prescribed by law. Members shall provide the certificate of completion to the City Clerk.
7) Policy Role of City Council – City Council Members will respect and adhere to the CouncilManager form of government. The City Council determines City policies with the advice, information, and analysis provided by the public, boards, commissions, committees and staff.
Members provide direction to the City Manager. The City Manager then determines the administrative functions of the City or the professional duties of City staff. 8) Independence of Boards, Commissions and Committees - City Council members will preserve the essential autonomy of boards, commissions, and committees in providing unbiased advice during the public decision-making process. City Council Members shall refrain from using their positions to inappropriately sway the deliberations or outcomes of board, commission, and committee proceedings and shall exhibit independence, impartiality, and fairness in their decisions and behaviors.
9) Positive Work-Place Environment – City Council Members will support the maintenance of a positive and constructive work-place environment for City employees and for members of the public and businesses dealing with the City.
10) Staff Relations - All requests of City staff should be directed to the City Manager. All concerns or complaints regarding staff should be directed to the City Manager, unless the complaint relates to the City Manager. In this instance, the concern should be directed to the City Attorney for review.
11) Religious Invocations, Displays, and Attire. – The City Council acknowledges the City’s diverse religious and ethnic backgrounds and the importance of citizen’s rights to freedom of religion, while also recognizing constitutional limitations imposed by Federal and State laws on such expression in governmental settings.
a) Invocations, not in the form of prayer, are allowed at the beginning of Council Meetings to emphasize the seriousness of the occasion. An invocation cannot advance or disparage one religious faith over another, nor invoke one religious deity over another.
Invocations must remain non-sectarian in content and may not proselytize or use language that may be interpreted as an attempt to convert. Prayer by a Council Member or the City Council during a Council Meeting is prohibited. b) Religious displays are permitted on City property provided they are educational in nature and do not advance, nor disparage one religion over another. c) City officials may wear religious attire associated with their beliefs but should be mindful of when such displays may trigger or encourage conduct that distracts from the purpose of governmental conduct.
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Code of Conduct and Governance Protocols Page 9 Rev 11/19/24 12) Conflict of Interest – City Council Members shall refrain from acting upon conflicts of interest and in a manner prescribed by law, which generally requires Members:
a) Disclose their financial investments, real property holdings, income sources, and gifts. b) Refrain from leveraging their official positions to influence decisions involving financial interests or personal relationships.
c) Not accept any gift, grant or contract contingent upon a specific action by the City Council. d) Refrain from any investment or monetary interest in any contract with the City. e) Seek advice from the City Attorney prior to any conduct that may be inconsistent with this provision.
13) Incompatible Employment – City Council Members are prohibited from any private employment, or rendering services for private interest, when such employment or service is incompatible with proper discharge of their official duties or would tend to impair their independence of judgment or action in the performance of those duties. 14) Disclosure of Confidential Information – City Council Members are prohibited from disclosing confidential information nor shall they use such information to advance their financial interests.
15) Ex-Parte Communications – Ex-parte communications are direct or indirect communications between a Member and a party/person regarding a matter before the Council, without giving all parties notice or the opportunity to participate. City Council Members are expected to openly disclose substantive and pertinent information - including all ex-parte communications - they may have acquired from external sources unrelated to the public decision-making process.
16) Political Participation and Advocacy – City Council Members may engage in political activities.
However, if a Member chooses to adopt a stance on a political matter, they must proactively ensure the public is aware of the clear differentiation between their personal opinions and the City Council's positions. While Members may use their title while engaging in political activities, they must explicitly state that they are not representing the City nor the City Council. Moreover, Members will publicly respect collective City Council decisions, regardless of their individual vote or individual political stance on the matter. Members shall represent the official policies or positions of the City Council to the best of their ability when designated as delegates for this purpose.
17) Use of Public Resources - Members are prohibited from utilizing public resources, such as City staff time, equipment, supplies, or facilities, for personal or political gain, or to support campaign activities for candidates or ballot measures, unless those resources are available to the public. Moreover, they are not permitted to use the City's name or logo to endorse any political candidate or business.
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Code of Conduct and Governance Protocols Page 10 Rev 11/19/24 Implementation, Compliance and Enforcement
The Code of Conduct outlines standards of ethical conduct expected for City Council Members and is intended to be self-enforcing. Members are expected to have a thorough understanding of it and adhere to its provisions. Members bear the primary responsibility for ensuring these ethical standards are understood and upheld. The Code of Conduct will be integrated into the standard orientations for City Council candidates, applicants seeking positions on boards, commissions, and committees, as well as newly elected and appointed officials.
The Mayor, in consultation with the City Manager and City Attorney, will be responsible for addressing a City Council Member who violates the Code of Conduct. The Vice Mayor will be responsible for addressing the Mayor in the event of a violation of any of the above provisions.
If an informal discussion does not resolve the issue, a more formal approach may be considered.
Any City Council Member may seek to have another Member censured at a regular City Council meeting. The City Council may impose sanctions on a Member(s) whose conduct does not comply with the Code and Protocols, such as reprimand, formal censure, loss of seniority, or committee assignment. Prior to the imposition of any sanctions the City Council shall follow applicable due process procedures with respect to the affected Member.
Statement of Commitment
Members of the American Canyon City Council and the Council’s appointees to various commissioners and boards shall sign a Statement of Commitment, agreeing to uphold the Code of Conduct.
________________________________________________________________________ Name, Position Date
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Code of Conduct and Governance Protocols Page 11 Rev 11/19/24 SECTION THREE: ROLES, RESPONSIBILITIES AND RELATIONSHIPS City Council Roles and Responsibilities
Vision and Strategy. Effective organizations are proactive and anticipate issues before they escalate into crises. Organizational leaders must be able to see "the Big Picture." The City Council's primary role is to create a vision for the future and develop strategies to achieve it. In this capacity, City Council should rely on the technical expertise of staff and the input of the community. The City's General Plan is the appropriate document for articulating this vision and strategy.
Leadership and Service. Leadership and service are traditional roles of any elected body.
Community service and staying engaged with the public are critical elements. Symbolic gestures, such as proclamations or attendance at annual events, are important parts of the job. Equally important is leading by example. The public's perception of city government is often a reflection of its elected officials; City Council Members need to reflect this in their actions and statements.
Policies and Priorities. The City Council’s primary role is to establish policies and set priorities for city services and functions. This is often challenging due to limited funding, which makes it difficult to meet all goals.
In making decisions, the City Council relies on having various options to consider. Staff provide analysis and alternatives for deliberation, while input from the community and stakeholders ensures that decisions reflect community values. It’s also essential to weigh opportunity costs, as allocating resources to one priority limits funding for others.
Accountability and Oversight. The goal of accountability is to ensure success, rather than punish failure. The City Council needs to set standards and deadlines, define what success looks like, and hold staff accountable for achieving those standards and deadlines. Regular status reports are critical to track progress and develop strategies to correct any shortcomings.
Effective oversight requires a strong understanding of city services and the issues surrounding their delivery. City Council Members are expected to learn as much as they can about city programs and receive at least an annual report from the various City Departments.
The use of outside experts is encouraged. These technical experts can serve as a "second set of eyes" and may be effective in evaluating large or complex projects, potential legal conflicts, and other circumstances as warranted.
Ethical and Fiduciary Responsibilities. Ethical standards go beyond mere compliance with the law. The City Council needs to conduct itself in a manner that is above reproach. Additionally, the City Council must recognize its financial responsibility to the community. Residents, visitors, and businesses pay taxes and fees, often without the right to decline; therefore, ensuring that these funds are spent in the most efficient, productive, and equitable manner possible is one of the City Council's main responsibilities.
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Code of Conduct and Governance Protocols Page 12 Rev 11/19/24 Mayor’s Role. The Mayor is directly elected by the voters to serve as the head of the City Council.
The Mayor chairs the City Council meetings, is involved in setting the agenda with the City Manager, and often acts as the ceremonial leader of the community. Additionally, the Mayor may take on a leadership role beyond ceremonial duties, such as delivering an annual State of the City address or outlining the city's priorities for the upcoming year. In this capacity, the Mayor should collaborate with the rest of the City Council to set these priorities.
Vice-Mayor’s Role. The Vice-Mayor is selected by the rest of the City Council and generally serves for a 12-month period. The Vice-Mayor's primary role is to fulfill the duties of the Mayor in their absence. The Vice-Mayor is responsible for scheduling regular performance reviews of the City Manager and other officials reporting directly to the Council.
City Council Relationships
City Council and the City Manager. The relationship between the City Council and the City Manager is the most critical, insofar as the City Council's direction is achieved primarily through the City Manager. While the City Council sets policy and staff administer it, the distinction can often blur. For example, the City Council relies on staff for policy analysis and alternatives; the quality of this analysis influences the City Council deliberation and action. Similarly, the City Council needs a basic understanding of how city services and programs are implemented to provide proper oversight and ensure successful policy implementation.
The City Manager is the Chief Executive Officer of the City, responsible for overseeing the dayto-day operations and implementing the policies set by the City Council. The City Manager acts as a bridge between the City Council and staff, ensuring City Council directives are effectively executed and that City services run smoothly. Key responsibilities include:
Administration of City Departments: The City Manager supervises all city departments and staff, aside from the City Attorney’s office, ensuring that they operate efficiently and deliver services effectively. This involves managing budgets, overseeing personnel, and coordinating activities across different departments.
Policy Implementation: The City Manager translates the policies and goals established by the City Council into actionable plans. This includes preparing detailed reports, recommending policy initiatives, and ensuring that City Council decisions are executed in accordance with legal and procedural requirements.
Budget Preparation and Management: The City Manager is responsible for preparing the City’s budget, working with finance staff to develop a financial plan that reflects the priorities of the City Council. This includes monitoring revenue and expenditures, ensuring fiscal responsibility, and making recommendations for budget adjustments as needed.
Advisory Role: The City Manager provides the City Council with expert advice and information to aid in decision-making. This involves conducting research, analyzing data, and offering recommendations on a wide range of issues affecting the City. 145
Code of Conduct and Governance Protocols Page 13 Rev 11/19/24 Community Relations: Acting as a representative of the City, the City Manager engages with residents, businesses, and other stakeholders to address concerns, provide information, and foster positive relationships within the community.
Crisis Management: In times of emergency or crisis, the City Manager plays a key role in coordinating response efforts, managing resources, and communicating with the public and other agencies to ensure effective and timely resolution.
City Council and the City Attorney. The City Attorney is directly supervised by the City Council and provides legal counsel and representation for the City government. This position is essential for ensuring that the City’s operations and policies comply with legal standards and that the City is protected from legal risks. Key responsibilities include:
Legal Advice and Counsel: The City Attorney provides legal guidance to the City Council, City Manager, and various city departments on a wide range of issues such as municipal regulations, contracts, land use, and employment matters, ensuring that the City’s actions and decisions adhere to the law.
Drafting and Reviewing Legal Documents: The City Attorney is responsible for drafting and reviewing legal documents, including ordinances, resolutions, contracts, and agreements. This ensures that these documents are legally sound and protect the City’s interests.
Representation in Legal Matters: The City Attorney represents the City in legal proceedings, including lawsuits and administrative hearings. This involves preparing legal arguments, presenting cases, and negotiating settlements to safeguard the City’s legal and financial interests.
Compliance and Risk Management: The City Attorney helps the City comply with federal, state, and local laws, regulations, and ordinances. They also identify and mitigate potential legal risks, providing advice on how to avoid or address legal issues that may arise.
Training and Education: The City Attorney provides training and educational sessions to City officials and staff on legal issues relevant to their roles. This helps ensure that City employees are aware of legal requirements and best practices.
Public Records and Transparency: The City Attorney works with the City Clerk to ensure compliance with public records laws and transparency requirements, helping the City manage requests for public records and maintain open communication with the public.
Ethics and Conduct: The City Attorney provides guidance on ethical issues and conduct standards, helping to maintain integrity within City operations and addressing any allegations of misconduct.
City Council and Commissions. Commissions exist to help distribute the workload that would otherwise fall to the City Council. They are advisory to the City Council, which should rely on Commissions to study matters within their purview and make recommendations. Staff provide administrative and technical support to the Commissions as needed. 146
Code of Conduct and Governance Protocols Page 14 Rev 11/19/24 At least one joint meeting between the City Council and each Commission should be scheduled annually, focusing on broad policy issues and working relationships rather than specific action items. Other joint meetings can be convened to address specific topics.
The City Council shall follow solicit candidates for Boards and Commissions in a manner consistent with State law (“Maddie Act”). Candidates who have participated in the leadership programs such as Citizen’s Academy and Leadership Napa Valley are preferred. Candidates will be screened by the City Council through a process that may be established and modified as appropriate. Individuals selected will serve at the City Council's pleasure, with the possibility of reappointment at the end of their terms.
City Council and the General Public. The City Council represents the best interests of the public, requiring active and engaged participation in the community. This also means that City Council actions may sometimes be unpopular, particularly regarding fiscal matters or land use decisions.
The City Council must provide a clear and consistent rationale for its decisions, ensure transparency in its actions and the data relied upon, and offer ample opportunity for public debate.
City Council and Outside Jurisdictions/Agencies. City Council Members serve on several outside agencies, generally commissions or committees that are countywide in nature. In these cases, City Council Members are expected to represent the best interests of the community, not their own self-interests. Members are responsible for reporting on the actions of the outside bodies on which they serve. Depending on the issue, a Member may request that a topic be scheduled for the full City Council to consider.
The City Council's goal is to establish positive and cooperative relationships with other jurisdictions. Either individually or collectively, the City Council should be involved in regional bodies such as the Association of Bay Area Governments (ABAG) and the League of California Cities (CalCities).
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Code of Conduct and Governance Protocols Page 15 Rev 11/19/24 SECTION FOUR: GOVERNANCE
Ensuring that the City is well run and addresses issues before they become problems is the essential responsibility of the City Council and staff. This is best accomplished by setting goals, strategies and key initiatives; efficiently allocating scarce resources; and tracking progress towards accomplishing those goals. In addition, City Council can delegate its responsibilities to committees and commissions.
Goals, Strategies and Key Initiatives
Setting Goals and Strategies is a primary City Council function. Goals represent actionable expressions in support of Community’s Vision, Mission and Values, while Strategies are concrete ideas to support the City Council’s Goals.
The image below expresses the hierarchy between the Community’s Vision, Mission, Values, the City Council’s Goals and Strategies, and the Key Initiatives and day-to-day tasks undertaken by staff.
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Code of Conduct and Governance Protocols Page 16 Rev 11/19/24 Goals. The City Council has the following goals, which are given equal weight and priority:
• Public Safety: Ensure that American Canyon remains a safe community. • Community and Sense of Place: Build on the strength of our local community to develop a clear sense of place and establish our unique identity. • Economic Development and Vitality: Attract and expand diverse business and employment opportunities.
• Outdoors and Recreation: Expand opportunities for use of outdoor recreation and an active lifestyle.
• Transportation: Improve the City’s transportation network to mitigate traffic and enhance the quality of life for the community.
• Infrastructure: Develop and upgrade infrastructure resources to support sustainable growth.
• Quality Services & Organizational Effectiveness: Deliver exemplary government. • Environmental Sustainability: Demonstrate leadership in environmental sustainability.
Strategies. Strategies are not measurable and do not have a finite conclusion but should have a 3 to 5-year horizon. Each goal should have between 2 and 5 strategies. Strategy development is coordinated between the City Council and staff.
Key Initiatives. Key Initiatives are specific actions achievable within a 12-to-24-month timeframe.
They have an identifiable start and finish, and in some instances, may be led by 3rd parties. Staff proposes a set of initiatives as part of a recurring process each year, and then tracks their implementation throughout the year, reporting back to City Council as necessary.
Although not expressly identified in the Protocols, the Strategies and Key Initiatives can be found in the “Strategic Work Plan” which is updated every 12 to 24 months.
Budgeting with Limited Resources
City resources will always be limited, so setting priorities is essential. The City Council should solicit input from the public, staff and other stakeholders in determining these priorities. Once priorities are set, the City Council should adopt a budget with sufficient staffing and resources.
Lower priorities can be deferred until later or when additional resources become available. This process ensures that priorities are more likely to be accomplished and helps avoid overloading staff with too many priorities. If a more critical issue arises, the City Council can adjust its priorities and timelines accordingly.
Ensure Accountability and Tracking Progress
As the Chief Executive Officer, the City Manager’s effectiveness is central to achieving Council goals and priorities. As such, evaluating the Manager’s performance (along with any other City Officials reporting directly to the City Council) is perhaps the single most important task of the City Council.
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Code of Conduct and Governance Protocols Page 17 Rev 11/19/24 Annual Performance Reviews. The City Council reviews the performance of all City Officials reporting to the Council (City Manager and City Attorney) annually. Regular "check-ins" should also be scheduled to ensure ongoing performance and alignment with goals. The review process should evolve over time, reflecting the incumbent's experience in their position. Initial reviews aim to confirm that the employee possesses the necessary skills, knowledge, and abilities.
Subsequent reviews should focus on the accomplishment of projects and priorities set during the previous review. The performance review process begins with a written review which is presented to the employee, followed by a general discussion between the City Council and the City Official.
A review document that ranks specific attributes based on general categories should be used.
This document will include an overall ranking and space for comments, allowing Members to provide examples supporting their rankings. Each Member will complete their own review, which will then be consolidated and presented to the employee.
The annual review should serve as the basis for determining the employee's compensation.
Salary increases will be based on the employees’ success in achieving their goals. Employees covered by an employment contract will follow these guidelines. However, if a conflict arises between the employment contract and these guidelines, the terms of the contract will prevail.
Monitoring Progress. The City Council should meet at least annually with staff to review the previous year's progress, adjust priorities as needed, and improve working relationships between City Council Members and between the City Council and staff. Part of this strategic planning should involve identifying the milestones of key initiatives in the upcoming year and a schedule to review their progress more frequently.
In addition, regular reports on key initiatives and capital projects should be added to the City Council Agenda, to provide both the City Council and the general public updates on progress made and issues that may need to be addressed by City Council action.
Council Committees
City Council Standing Committees. Standing Committees are comprised of two (2) City Council Members who make specific recommendations to the full City Council. Committee Members are responsible for reporting their ongoing activities during City Council meetings. Standing Committee meetings are coordinated by the City Manager and may be called by either Member assigned to the committee. The City Manager assigns staff to support Standing Committees.
Standing Committees are subject to public meeting requirements.
City Council Ad Hoc Committees. Ad Hoc Committees are comprised of two (2) City Council Members who make specific recommendations to the full City Council. Ad Hoc Committees are formed by the City Council on an “as needed” basis with a clearly defined purpose and term. Ad Hoc Committees are single-purpose, and meetings are held as needed. Once the Ad Hoc Committee has completed its work, it is disbanded. Committee Members are responsible for 150
Code of Conduct and Governance Protocols Page 18 Rev 11/19/24 reporting their activities during City Council meetings. Ad Hoc Committee meetings are coordinated by the City Manager and may be called by either Member assigned to the committee. The City Manager assigns staff to support Ad Hoc Committees. Ad-Hoc Committees are not subject to public meeting requirements.
City Council and Citizen Advisory Bodies. The City Council may appoint one or more “citizen advisory bodies”. These boards, commissions and committees exist to help distribute the workload that would otherwise fall to the Council. They are advisory to the City Council, which should rely on these bodies to study matters within their purview and make recommendations.
Staff provide administrative and technical support to these bodies as needed. The City Manager will schedule regular “joint meetings” between the City Council and these bodies to focus on broad policy issues, work plans, and working relationships. The City Clerk will solicit candidates for these bodies, who will be screened by the City Council. Individuals selected on these bodies serve at the City Council's pleasure and may be removed at any time for any reason – including but not limited to - violations of the Code and Protocols. 151
Code of Conduct and Governance Protocols Page 19 Rev 11/19/24 SECTION FIVE: MEETINGS
State law requires the City Council to conduct business and make decisions together as a group, rather than as individuals. Generally, the group is required to meet in a manner that is “open to the public” instead of “behind closed doors”. These “Public Meeting” requirements generally apply to citizen advisory bodies too, regardless of whether they are decision-making or advisory in nature.
What is a “Public Meeting” (aka the “Brown Act”)?
When a majority of the City Council gathers to hear, discuss or deliberate topics, a “meeting” occurs – regardless of whether the Members intended upon having a meeting. The City Council may only conduct lawful meetings and to be lawful, a meeting must be noticed, have an agenda, include public participation, and follow other procedural rules.
Importantly, meetings need not occur at the same time or place. For example, a private email from one City Council Member to the entire Council might (inadvertently) become a “meeting” if two other Members respond at a later time and date. However, since the procedural rules about notice and participation cannot be followed, this (email) meeting would not be lawful. This standard applies for all scenarios by which a majority of Members uses any communication technology (telephone, text message, e-mail, blog, social media, etc.) to hear, discuss or deliberate topics within the City Council’s purview.
In addition, interaction between individual City Council Members can (inadvertently) become meetings too. For example, a private email exchange from one Member to another could later become a meeting if one of the Members then forwards the email exchange to a 3rd Council Member, who then initiates a response and exchange back with that Council Member. In this case, a “serial meeting” can occur. Serial meetings are unlawful because there is no way to notice such meetings or to provide for public participation.
Something as simple as pressing "Reply All" to an email sent by City staff to all Members can inadvertently trigger such a serial meeting violation. For example, if your "Reply All" message tries to convince other Members to join your point of view on an issue could become unlawful because Members are considering an issue outside of the public's view.
State law also prohibits Members from using social media platforms to hold meetings. You may not respond to another Member’s social media posts regarding items in Council, this prohibition includes a thumbs up response or emoji indicating agreement or disagreement.
Although Members may attend a purely social gathering or attend conferences or seminars, they must take care not to discuss City business among themselves.
Persons with matters pending before City Council may approach individual Members to discuss matters in private. It is up to that Members’ sole discretion whether to honor the request, but Members must remember they are acting in an official capacity if they do and must disclose the 152
Code of Conduct and Governance Protocols Page 20 Rev 11/19/24 occurrence of all private discussions to ensure the City Council has access to all resulting information.
There are civil remedies and criminal misdemeanor penalties for violations of the Brown Act. The civil remedies include injunctions against further violations, orders nullifying any unlawful action and orders determining the validity of any rule to penalize or discourage the expression of a Member. Criminal penalties may result if a person is found guilty of a wrongful or deliberate intent to deprive the public of information to which it is entitled under the Brown Act.
The most effective approach to prevent these penalties is to hold the City Council’s meetings in a public forum, stick to the agenda items, and consult the City Attorney, City Manager or City Clerk if you have any uncertainties regarding whether an action might violate the Brown Act.
City Council Meetings
The purpose of City Council Meetings is to conduct City business. Matters not on the Agenda are not discussed. City Council Members prepare for City Council Meetings by reviewing the entire Agenda Packet and informing the City Manager of any questions, comments or concerns prior to the City Council Meeting. While City Council Meetings follow parliamentary procedures, they also maintain a natural, respectful flow, allowing for public input and reasonable deliberations.
Regular City Council Meetings. Regular meetings are held on the first (1st) and third (3rd) Tuesdays of the month. Closed Session starts at 5:30 PM, with Open Session beginning at 6:30 PM.
Meetings are adjourned by 10:00 PM unless extended by a majority vote.
Special City Council Meetings. Special meetings may be held at any date or time following a 24- hour notice by the Mayor or a majority of City Council Members. Only the matters in the notice may be considered.
Meeting Calendar. A calendar of next year’s Regular City Council Meetings is adopted by the City Council at the end of each calendar year. Additional Special City Council Meetings may be scheduled as needed throughout the year.
Attendance. City Council Members are expected to attend all Regular and Special City Council Meetings. Attendance is defined as being marked “present” during Roll Call and remaining present until the meeting is adjourned. Members who do not attend a City Council Meeting are deemed “absent”. The City Clerk is responsible for tracking Member attendance.
Excused Absences. To be eligible for an “Excused Absence” from a Regular City Council Meeting, the requesting City Council Member must notify the Mayor and City Manager at least 24 hours prior to Roll Call. To be eligible for an “Excused Absence” from a Special City Council Meeting, the requesting Member must notify the Mayor and City Manager prior to Roll Call. Assuming requisite prior notification occurs, the Mayor shall grant an Excused Absence without further inquiry. However, the Mayor may not grant more than four (4) Excused Absences per calendar year (per Member). After the fourth Excused Absence, the City Council must determine whether 153
Code of Conduct and Governance Protocols Page 21 Rev 11/19/24 reasonable circumstances exist to grant any Member a fifth (5th) (or more) Excused Absence.
Upon being granted an Excused Absence, the requesting Member will be compensated in the usual manner provided they have been briefed by the Mayor or City Manager on the matters discussed during the Excused Absence.
Unexcused Absences. City Council Members who do not attend a City Council Meeting or fail to provide the required notice are deemed to be “Unexcused”. City Council Members are ineligible for compensation after three (3) or more Unexcused Absences in any calendar year.
Compensation will be withheld on a pro-rata basis each month the Council Member is deemed to have four (4) or more Unexcused Absences in a Calendar Year. In addition to withholding compensation after three (3) or more Unexcused Absences, the Member may also be sanctioned by the City Council for violation of the Code and Protocols.
Teleconferencing. City Council Members are expected to attend all Regular and Special City Council Meetings in person. Notwithstanding this expectation, there may be instances where a Member chooses to attend a City Council Meeting remotely by phone or video conference (ie. “teleconferencing”). Attending a City Council Meeting remotely can impose a burden on staff and the City Council. Instances of teleconferencing are expected to be limited and a Member’s desire to attend planned out well in advance of the meeting. Procedures for remote City Council Meeting attendance are prescribed by State law and it is the remote-attending Member’s responsibility to ensure compliance with State law.
Quorum and Voting. A minimum of three (3) affirmative votes is required for the City Council to act, there are exceptions where disqualifications may occur, in which case the City Attorney would advise as to how the Council can achieve the required number of Council members necessary to consider, advance, or approve a matter.
Participation and Voting Required. A Member in attendance at a City Council meeting is required to participate in each agenda item and then vote when called upon by the City Clerk. If the Member believes they have a disqualifying conflict of interest, they must publicly explain the nature of their conflict and then remove themselves from the City Council Chambers prior to the item being considered so they will be considered to have abstained from voting. A detailed list of disqualifying conflicts of interest is shown in the Appendix. Importantly, having to make a difficult or unpopular decision is not a disqualifying conflict of interest or basis for abstention.
Rule of Necessity (“Legally Required Participation”). If a majority of the City Council shall be disqualified to vote on a matter by reason of actual or apparent conflict of interest, the City Council shall select by lot or other means of random selection, or by such other impartial and equitable means as the City Council shall determine, that number of its disqualified Members which, when added to the Members eligible to vote, shall constitute a quorum.
Those Members may vote but not discuss.
Minutes. “Action minutes” prepared by the City Clerk’s Office represent the official summary of the City Council’s actions. Video recordings supplement the minutes. However, when City 154
Code of Conduct and Governance Protocols Page 22 Rev 11/19/24 Council action is not taken but direction to staff is provided, the specific direction is included in the minutes to avoid misunderstandings and ensure the direction is implemented.
Agenda-Setting Process. The City Clerk maintains a twelve-month rolling calendar of future agenda items for which the City Manager is generally responsible for coordinating and assigning the respective dates for those items. This calendar is available for review by City Council Members by request to the City Manager. Each City Council Meeting Agenda also includes a list of notable future items.
City Council-Requested Items. Members may request future agenda items. This first should be requested informally through consultation with the City Manager and then, if necessary, based on formal consensus of the Council.
Agenda Packet Preparation & Delivery. The agenda contains topics for consideration. The City Clerk, in consultation with staff, prepares a “packet” of information containing all the supporting documents for each agenda item (Agenda Packet). The Agenda Packet is delivered electronically to Members no later than 5:00 p.m. on Friday preceding the Tuesday meeting to which it pertains. The Agenda Packet is only provided in an electronic format. The Agenda Packet is distributed to the Members at the same time it is made available to the public.
Agenda Posting. The City Clerk is responsible for posting regular meeting agendas at least 72 hours prior to the meeting. Agendas shall be physically posted on the bulletin board outside of City Hall and electronically posted at the Virtual City Hall. Agendas are also electronically delivered to those who have registered to receive them.
Agenda Order. The Mayor conducts the meeting in the order shown on the agenda or as otherwise modified by the City Council.
Meeting Decorum. To ensure proper decorum, the City Council enforces measures to minimize interruptions, such as requiring cellular phones and pagers to be turned off or set to vibrate.
Public input is time-limited and should occur prior to Council Member comment or deliberation.
Council Members are encouraged to be concise in their remarks. While at a City Council meeting, be mindful of electronic devices, such as smart phones, laptops and tablets. Do not use such devices to communicate with other Members, commissioners, Members of the public, or undertake ad hoc research while the City Council is considering a matter. Doing so results in parts of the decision-making process occurring outside of the public's view (and implicates due process concerns for some City Council decisions).
Parliamentary Procedure. The City Council follows Rosenberg’s Rules of Order. The purpose of the rules of parliamentary procedure is to establish a framework for the orderly conduct of meetings. The Rules should be clear and user-friendly. Simple rules lead to wider understanding and participation. Complex rules create two classes: those who understand and participate; and those who do not fully understand and do not fully participate. So, the rules must be simple enough that the public is invited into the body and feels that it has participated in the process. 155
Code of Conduct and Governance Protocols Page 23 Rev 11/19/24 Also, the Rules should enforce the will of the majority while protecting the rights of the minority.
The ultimate purpose of rules of procedure is to encourage discussion and to facilitate decision making by the body. In a democracy, the majority rules. The rules must enable the majority to express itself and fashion a result, while permitting the minority to also express itself, but not dominate, while fully participating in the process.
Closed Session
All City Council Meetings are open to the public. However, the City Council may hold “closed sessions”, from which the public may be excluded. Topics that may be discussed are limited to the following: personnel matters, property negotiations, labor negotiations, existing litigation, anticipated litigation and other topics allowed by law.
Closed Session attendees consist of the City Manager, City Attorney, City Council and any other person deemed necessary by the participants to further the discussion of the items for consideration. Each Closed Session participant must independently determine for themselves whether their participation in Closed Session is appropriate or lawful, and reliance upon the advice of others can be insufficient justification for inappropriate participation.
Call to Order. The Mayor (or Vice-Mayor) calls the Closed Session to order at the appointed time.
In the absence of both, the meeting shall be called to order by the City Manager and those Council Members present shall proceed to select a “temporary presiding officer”.
Roll Call. Immediately after Call to Order, the City Clerk conducts a “roll call” of the Members present whose names that are recorded as “present” (i.e. in attendance.).
Public Comments. This time is reserved for the public to address the City Council on Closed Session items only. Comments are time-limited, typically 3 minutes.
Personnel Matters. The City Council may consider the appointment, employment, or dismissal of a public employee or to hear complaints or charges brought against such a person or employee.
The Council may also review the performance of City Officials reporting directly to the City Council.
Property Negotiations. The City Council may discuss the terms and conditions under which real property may be acquired or sold but the actual purchase agreement or contract must be approved in an open session.
Labor Negotiations. The City Council may discuss the terms and conditions for meeting the City’s obligations of negotiating in good faith with represented employees regarding wages, benefits, and working conditions.
Existing Litigation. The City Council may discuss existing legal matters to which the City is an actual party.
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Code of Conduct and Governance Protocols Page 24 Rev 11/19/24 Anticipated Litigation. The City Council may discuss legal matters in which the City could become a party; however, this exception must be narrowly construed to apply only to matters with existing specific facts or circumstances, and not those based on future or hypothetical facts or circumstances.
Threats Against the City. The City Council may discuss threats to the security of public buildings, essential public services - including water, drinking water, wastewater treatment, natural gas service, and electric service - or a threat to the public's right of access to public services or facilities.
Confidentiality. Matters discussed in Closed Session shall not be discussed outside of the Closed Session by any City Council Member or City Official attending the meeting. Members who violate this policy are subject to sanctions by the City Council. Sanctions may include, but are not limited to, removal of the City Council Member from other boards and commissions where the Member represents the City. This policy ensures that the City Council conducts sensitive discussions appropriately while maintaining transparency and accountability to the public where required.
Open Session
Call to Order. The Mayor (or Vice-Mayor) calls the meeting to order at the appointed time. In the absence of both, the meeting shall be called to order by the City Manager and those City Council Members present shall proceed to select a “temporary presiding officer”.
Pledge of Allegiance. The Mayor leads the Pledge of Allegiance.
Open Session Roll Call. Immediately after the Pledge, the City Clerk conducts a “roll call” of the Members present whose names are recorded as “present” (i.e. in attendance.) Report on Closed Session/Confirmation of Reportable Action. The City Attorney announces any reportable action taken by City Council during Closed Session.
Proclamations. The City Council issues proclamations to recognize, honor and/or celebrate various community interests. The City Council generally takes a photo with recipients immediately after presenting the proclamation. A calendar of next year’s Proclamations is adopted by the City Council at the end of each calendar year. Additional Proclamations may be scheduled as needed throughout the year.
Presentations. The City Council receives pertinent information from 3rd parties generally related to an area of interest.
Public Comments. City Council meetings are a limited public forum. Any person may address the City Council on any subject pertaining to City business, and which is not listed on the regular or closed session agendas. Generally, each person will be allowed up to three (3) minutes of time to address the City Council. One two-minute extension may be granted by the mayor at their discretion.
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Code of Conduct and Governance Protocols Page 25 Rev 11/19/24 American Canyon promotes respectful and responsible behavior among its meeting participants, whether they are present in person or remotely. Using offensive language or remarks that promote, foster, or perpetuate discrimination based on race, creed, color, age, religion, gender marital status, status regarding public assistance, national origin, physical or mental disability or sexual orientation/gender identification, as well as any other category protected by federal, state or local laws is discouraged. In the event that offensive language or remarks cause a disturbance of the meeting, a warning to the disrupter will be given and if the disruption continues, all meeting attendees may be required to vacate the Council Chambers with the meeting proceeding after a recess without in-person public attendance.
Agenda Review and Changes. The City Council may vote to modify the order of the agenda, to expedite the business of the City or to accommodate Members of the audience.
Consent Calendar. Items of a routine or non-controversial nature shall be placed on the Consent Calendar. A brief description of the item and/or the action to be taken shall be included to provide a better understanding of the issue. Item on the Consent Calendar are approved as a group, with single motion, second and vote. Typical items include:
• Prior meeting minutes.
• Monthly or informational reports.
• Routine purchases or awards of contracts of an item already budgeted. • Actions approved in concept at a prior meeting.
Public Hearings. Generally, for legal purposes, certain items are heard as a public hearing, rather than as a Business Item. Public hearings will follow the noticing requirements as stipulated by applicable law. Public hearings are conducted in the following order:
1. Council Member Ex Parte disclosure
2. Staff review
3. Questions of staff by Council
4. Hearing opened by the mayor
5. Testimony from the applicant (if appropriate)
6. Testimony from the public
7. If desired, hearing closed.
8. Discussion by Council
9. Council action
Quasi-judicial hearings (such as when the Council is considering an appeal of a land use decision by the Planning Commission) shall be conducted in accordance with the principles of due process, and the City Attorney shall advise the City Council in this regard.
At any public hearing before the City Council, testimony of witnesses under oath may be requested by the City Council.
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Code of Conduct and Governance Protocols Page 26 Rev 11/19/24 Business Items. Business Items are less formal than Public Hearings and will be introduced and summarized by the City staff. The appropriate departmental representative will be available to answer questions that may be asked by Members or the public. Business items are conducted in the following order:
1. Staff review
2. Questions of Staff by Council
3. Testimony from the Applicant (if appropriate)
4. Public comment period is opened.
5. When finished, public comment period is closed.
6. Discussion by Council
7. Action by Council by roll call vote
Management and Staff Oral Reports. Staff present Informational reports not requiring formal action.
Mayor/City Council Comments and Committee Reports. Members are encouraged to submit a written report to the City Clerk for inclusion in the meeting packet. Alternatively, an oral update can be provided at this time.
Future Agenda Items. Future agenda items are reviewed and considered. New “Councilrequested” items are proposed by Member(s) through a motion and affirmative vote by the City Council majority. A log of future items will be maintained by the City Clerk and displayed on the agenda. The dates and prioritization of future agenda items is proposed by the City Manager subject to modification by direction of the City Council majority. 159
Code of Conduct and Governance Protocols Page 27 Rev 11/19/24 SECTION SIX: COMPENSATION
City Council Members receive a variety of forms of compensation more particularly described in the appendix.
Salary. City Council Members receive a salary as stipulated by State law which may be adjusted from time to time by the Legislature.
Cost of Living Increase. Beginning January 2026 and annually thereafter, City Council Members will receive a cost-of-living increase equivalent to the California Consumer Price Index of the prior 12 months up to maximum of 10%, provided however this increase shall not exceed the amount of cost-of-living increase received by City employees in the General Bargaining Unit. Any cost-ofliving increase must be approved by the City Council, with this typically occurring the prior June of each year in conjunction with the annual budget process.
Payment Schedule. City Council Members are paid on the same schedule as employees.
Additional Payment. City Council Members sit defacto as the American Canyon Fire Protection District Board of Directors (Fire District) and receive compensation separately and directly from the Fire District. Although Members will consider matters related to the former American Canyon County Water District ("Water District") from time to time, they will receive no additional compensation.
Retirement Benefit. City Council Members are eligible for retirement benefits.
Medical Benefit. City Council Members are eligible for medical benefits. If a Member is vested in the City’s retirement program, they will be eligible for retiree medical insurance benefits.
Dental and Vision. City Council Members are eligible for dental and vision care benefits.
Deferred Compensation. City Council Members are eligible to participate in the City’s Section 457 Deferred Compensation program.
No “Cash in Lieu” of Benefits. City Council Members are not eligible for "cash-in lieu of" any benefits they have declined.
Stipends. City Council Members are eligible to receive various stipends available to employees. 160
Code of Conduct and Governance Protocols Page 28 Rev 11/19/24 SECTION SEVEN: ADMINISTRATIVE SUPPORT
General. The City Manager will ensure that routine matters, such as distributing City Council mail and providing clerical support, are handled as needed. Customized stationery will be provided for each City Council Member, recognizing that individual Members do not represent the full City Council. City resources, including funds, equipment (e.g., cell phone, laptop personal computer, small file storage), supplies (including letterhead), and staff time must only be used for authorized City of American Canyon activities and purposes. When in doubt, Membersshould contact the City Manager for advice before making any commitments.
Master Calendar. A calendar of events, functions, and meetings will be maintained and kept current by the City Clerk. This calendar will include functions, events, and regularly scheduled meetings attended by individual Council Members and will be distributed to the full City Council.
Request for Information. City Council Members may request information or research from the City Manager if the request can be completed in less than an hour. Often, the City Manager will delegate this request to staff. Requests anticipated to take more than one hour should be directed to the City Council during a City Council meeting under "Future Council Item." Requests for new information or policy direction will be brought to the full City Council at a Regular Meeting for consideration. All written reports will be copied to the full City Council. This subsection does not apply to requests for information made to the City Attorney’s office.
Tickets to City Events. One ticket for each City Council Member will be provided for events hosted by the City or in which the City is a Member. Departments hosting City events will coordinate ticket distribution with the City Manager’s Office. The availability of tickets for events hosted by other organizations will be at the discretion of the organizing agency. When the City is a major sponsor of an event, staff will endeavor to include ticket availability in the sponsorship agreement or contract.
City Council Notification of Significant Incidents. The City Manager’s Office, in conjunction with the City’s public safety departments, will coordinate notifications to the City Council in conjunction with the City Communication Policy. Notifications will occur in the event of a natural disaster, riots, large-scale evacuation, gang activity involving murder, injury and hospitalization of a city employee while on the job, an officer-involved shooting, or a financial issue that could result in controversy or disgrace for the City of American Canyon. This will be done via email and/or telephone.
Business Cards and Name Tags. Members will be issued business cards to be used in the duties and functions of the office. Name tags will be issued to wear during meetings, events, or at any function where Members are representing the City in their role as a City Council Member. At the conclusion of a term, name tags and unused business cards shall be returned to the City Clerk.
Travel and Training. City Council Members follow the same policies as staff for travel for official business or for training and educational purposes. Members are responsible for making their own 161
Code of Conduct and Governance Protocols Page 29 Rev 11/19/24 travel arrangements and accommodation and avoid unnecessary expenditures and negative public perception.
Technology. Each City Council Member is provided with a City-issued electronic tablet to facilitate their City Council work. The tablet is a valuable tool that will assist Members in staying connected and contribute to the success of their role, and the organization's goals. The tablet will be returned to the City Clerk upon the end of the Member’s service on the City Council. 162
APPENDIX A CONFLICT OF INTEREST (FORM 700)
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An Overview of Conflicts of Interest
Under the Political Reform Act
May 2022
Contents
I. The Basic Prohibition................................................................................................ 2 II. Making, Participating in Making, or Attempting to Influence a Decision.................... 2 A. General Definitions................................................................................................ 2 B. Exceptions............................................................................................................. 3 III. Financial Interests ................................................................................................. 4 IV. Foreseeability of Financial Effect........................................................................... 5 A. Explicitly Involved .................................................................................................. 5 B. Not Explicitly Involved............................................................................................ 5 V. Materiality Standards ................................................................................................ 6 A. Business Entity Interests ....................................................................................... 6 B. Real Property Interests.......................................................................................... 7 C. Source of Income Interests.................................................................................... 9 D. Source of Gift Interests........................................................................................ 11 E. Interest in Personal Finances .............................................................................. 12 VI. The Public Generally Exception .......................................................................... 13 VII. Legally Required Participation............................................................................. 16 VIII. Segmentation ...................................................................................................... 17 IX. Disqualification Requirements ............................................................................. 18 Fair Political Practices Commission 1 Conflicts Overview May 2022
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I. The Basic Prohibition
Government Code Section 87100 of the Political Reform Act (the “Act”)1 prohibits a public official at any level of state or local government from making, participating in making, or attempting to use the official’s position to influence a governmental decision in which the official knows or has reason to know the official has a financial interest.
Government Code Section 87103 provides that an official has a “financial interest” within the meaning of Section 87100 if it is reasonably foreseeable that the decision will have a material financial effect on one or more of the official’s interests as identified and distinguishable from the decision’s effect on the public generally.
Taken together, these provisions of the Act prohibit an official from taking part in a decision if it is reasonably foreseeable that the decision would have a material financial effect on one or more of the official’s financial interests identified in Section 87103 distinguishable from the decision’s effect on the public generally.
II. Making, Participating in Making, or
Attempting to Influence a Decision
Regulation 18704 defines “making a decision,” “participating in a decision,” and “using official position to attempt to influence a decision” for purposes of the Act’s conflict of interest provisions. If an official has a disqualifying conflict of interest under Section 87100, the official is prohibited from making, participating in making, or attempting in any way to use the official’s official position to influence the decision.
A. General Definitions
Making a Decision: An official makes a decision if the official authorizes or directs any action, votes, appoints a person, obligates or commits the official’s agency to any course of action, or enters into any contractual agreement on behalf of the agency. (Regulation 18704(a).)
Participating in a Decision: An official participates in a decision if the official provides information, an opinion, or a recommendation for the purpose of affecting the decision without significant intervening substantive review. (Regulation 18704(b).) Using Official Position to Attempt to Influence a Decision: An official uses an official position to influence a decision if the official contacts or appears before: (1) any official in the official’s agency, or in an agency subject to the authority or budgetary control of the official’s agency, for the purpose of affecting a decision; or (2) any official in any other government agency for the purpose of affecting a decision, and the official purports to act within the official’s authority or on behalf of the official’s agency in making the contact. (Regulation 18704(c).)
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B. Exceptions
Regulation 18704(d) provides that “making, participating in, or using official position to influence a decision” do not include any of the following:
Ministerial: Actions that are solely ministerial, secretarial, or clerical. (Regulation 18704(d)(1).)
Appearances as a Member of the General Public: An appearance by an official as a member of the general public before an agency in the course of its prescribed governmental function if the official is appearing on matters related solely to the official’s personal interests, including interests in:
• Real property owned entirely by the official, members of the official’s immediate family, or the official and members of the official’s immediate family; • A business owned entirely by the official, members of the official’s immediate family, or the official and members of the official’s immediate family; or • A business over which the official, members of the official’s immediate family, or the official and members of the official’s immediate family solely or jointly exercise full direction and control. (Regulation 18704(d)(2).) Terms of Employment: Actions by an official relating to the official’s compensation or the terms or conditions of the official’s employment or consulting contract. However, an official may not make a decision to appoint, hire, fire, promote, demote, or suspend without pay or take disciplinary action with financial sanction against the official or the official’s immediate family, or set a salary for the official or the official’s immediate family different from salaries paid to other employees of the agency in the same job classification or position. (Regulation 18704(d)(3).)
Public Speaking: Communications by an official to the general public or media. (Regulation 18704(d)(4).)
Academic Decisions: Teaching decisions, including an instructor’s selection of books or other educational materials at the official’s own school or institution, or other similar decisions incidental to teaching; or decisions by an official who has teaching or research responsibilities at an institution of higher education relating to the official’s professional responsibilities, including applying for funds, allocating resources, and all decisions relating to the manner or methodology with which the official’s academic study or research will be conducted. (Regulation 18704(d)(5).) However, this exception does not apply to an official who has institution-wide administrative responsibilities as to the approval or review of academic study or research at the institution unrelated to the official’s own work. (Ibid.)
Architectural and Engineering Documents: Drawings or submissions of an architectural, engineering, or similar nature prepared by an official for a client to submit in a proceeding before the official’s agency if: (i) the work is performed pursuant to the official’s profession; and (ii) the official does not make any contact with the agency other Fair Political Practices Commission 3 Conflicts Overview May 2022
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than contact with agency staff concerning the process or evaluation of the documents prepared by the official. (Regulation 18704(d)(6)(A).)
Also, an official’s appearance before a design or architectural review committee or similar body of which the official is a member to present drawings or submissions of an architectural, engineering, or similar nature prepared for a client if: (i) the committee’s sole function is to review architectural designs or engineering plans and to make recommendations to a planning commission or other agency; (ii) the committee is required by law to include architects, engineers, or persons in related professions, and the official was appointed to the body to fulfill this requirement; and (iii) the official is a sole practitioner. (Regulation 18704(d)(6)(B).)
Additional Consulting Services: Recommendations by a consultant regarding additional services for which the consultant or consultant’s employer would receive additional income if the agency has already contracted with the consultant, for an agreed upon price, to make recommendations concerning services of the type offered by the consultant or the consultant’s employer, and the consultant does not have any other economic interest, other than in the firm, that would be foreseeably and materially affected by the decision. (Regulation 18704(d)(7).)
III. Financial Interests
The first step in determining whether an official has a disqualifying conflict of interest under the Act is identifying the official’s financial interests with respect to the decision at issue. Section 87103 identifies the following financial interests which may give rise to an official’s disqualifying conflict of interest under the Act:
• A business entity in which the official has a direct or indirect investment worth $2,000 or more (Section 87103(a)); or in which the official is a director, officer, partner, trustee, employee, or holds any position of management (Section 87103(d)).
• Real property in which the official has an interest worth $2,000 or more. (Section 87103(b).)
• A source of income totaling $500 or more in value provided or promised to, or received by, the official within the 12 months prior to the time when the decision is made. (Section 87103(c).)
• A giver of a gift or gifts totaling $5002 or more in value provided or promised to, or received by, the official within the 12 months prior to the time when the decision is made. (Section 87103(e).)
• The official’s personal finances and those of “immediate family,” defined in Section 82029 as the spouse and dependent children. (Section 87103.) Fair Political Practices Commission 4 Conflicts Overview May 2022
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IV. Foreseeability of Financial Effect
A. Explicitly Involved
A financial effect on a financial interest is presumed to be reasonably foreseeable if the financial interest is explicitly involved in the decision. (Regulation (18701(a).) An official’s financial interest is “explicitly involved” in a decision if the interest is a “named party in, or the subject of,” the decision, and an interest is the “subject of a proceeding” if the decision involves the issuance, renewal, denial, or revocation of any license, permit, other entitlement to, or contract with, the interest.3 Additionally, an official’s real property interest is explicitly involved in any decision affecting the real property as described in Regulation 18702.2(a)(1) through (6), discussed further below. (Ibid.) B. Not Explicitly Involved
When an official’s financial interest is not explicitly involved in a decision, the financial effect of the decision is reasonably foreseeable if the effect can be recognized as a realistic possibility and more than hypothetical or theoretical. The effect need not be likely to be reasonably foreseeable. (Regulation 18701(b).) Factors to be considered when determining if a decision’s effect on an official’s not explicitly involved interest is reasonably foreseeable include, but are not limited to, the following:
• The extent to which the occurrence of the effect is contingent upon intervening events (other than future governmental decisions by the official’s agency or an agency subject to the budgetary control of the official’s agency). (Regulation 18701(b)(1).)
• Whether the official should anticipate a financial effect on the financial interests at issue as a potential outcome under normal circumstances when using appropriate due diligence and care. (Regulation 18701(b)(2).) • Whether the official has an interest of the type that would typically be affected by the terms of the decision. (Regulation 18701(b)(3).)
• Whether the decision is of the type that would be expected to have a financial effect on businesses and individuals similarly situated to those businesses and individuals in which the official has a financial interest. (Ibid.) • Whether a reasonable inference can be made that the financial effects of the decision on the official’s financial interest might compromise an official’s ability to fulfill their duty to act in the best interests of the public. (Regulation 18701(b)(4).) • Whether the decision will provide or deny an opportunity, or create an advantage for one of the official’s financial interests. (Regulation 18701(b)(5).) Fair Political Practices Commission 5 Conflicts Overview May 2022
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• Whether the official has the type of financial interest that would cause a similarly situated person to weigh the advantages and disadvantages of the decision on the official’s financial interest in formulating a position. (Regulation 18701(b)(6).) V. Materiality Standards
Regulation 18702(a) provides that the next step in the analysis is to determine if the decision’s reasonably foreseeable financial effect on the official’s financial interest is material. If the official’s interest is in:
• A business entity, then apply the materiality standards of Regulation 18702.1. (Regulation 18702(a)(1).)
• A real property, then apply the materiality standards of Regulation 18702.2. (Regulation 18702(a)(2).)
• A source of income, then apply the materiality standards of Regulation 18702.3. (Regulation 18702(a)(3).)
• A source of a gift or gifts, then apply the materiality standards of 18702.4. (Regulation 18702(a)(4).)
• Their personal finances or those of immediate family, then apply materiality standard of 18702.5. (Regulation 18702(a)(5).)
A. Business Entity Interests
Regulation 18702.1 sets forth the materiality standards applicable to a decision’s reasonably foreseeable financial effect on a business in which an official has an interest, and provides that the effect is material if any of the following standards is met:
• The business is explicitly involved in the decision, meaning that the business is “a named party in, or the subject of, the decision, including any decision in which the business:
Initiates the proceeding by filing an application, claim, appeal, or other request for action concerning the business with the official’s agency. (Regulation 18702.1(a)(1)(A).)
Offers to sell a product or service to the official’s agency. (Regulation 18702.1(a)(1)(B).)
Bids on, or enters into, a contract with the official’s agency, or is identified as a subcontractor on a bid or contract with the agency. (Regulation 18702.1(a)(1)(C).)
Is the named or intended manufacturer or vendor of any products to be purchased by the official’s agency with an aggregate cost of $1,000 in any 12- month period. (Regulation 18702.1(a)(1)(D).)
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Applies for a permit, license, grant, tax credit, exception, variance, or other entitlement from the official’s agency. (Regulation 18702.1(a)(1)(E).) Is the subject of any inspection, action, or proceeding under the regulatory authority of the official’s agency. (Regulation 18702.1(a)(1)(F).) Is subject to an action taken by the official’s agency that is directed at the entity. (Regulation 18702.1(a)(1)(G).)
• The decision may result in an increase or decrease of the business’s annual gross revenues, or the value of its assets and liabilities, in an amount equal to or more than:
$1,000,000; or
Five percent of the business’s annual gross revenues, and the increase or decrease is $10,000 or more. (Regulation 18702.1(a)(2).) • The decision may cause the business to incur or avoid additional expenses or to reduce or eliminate expenses in amount equal to or more than:
$250,000; or
One percent of the business’s annual gross revenues, and the increase or decrease is at least $2,500. (Regulation 18702.1(a)(3).) • The official knows or has reason to know that business has an interest in real property and:
The property is a named party in, or the subject of, the decision under Regulations 18701(a) and 18702.2(a)(1) through (6); or
There is clear and convincing evidence the decision would have a substantial effect on the property. (Regulation 18702.1(a)(4).)
Thus, if the decision’s reasonably foreseeable financial effect on an official’s business interest meets any of the four standards above, that effect is material, and the official is disqualified from taking part in the decision.
Small Shareholder Exception: Regulation 18702.1(b) sets forth the “Small Shareholder Exception,” which provides that a decision’s reasonably foreseeable financial effect on an official’s financial interest in a business is not material under Regulation 18702.1(a)(1) or (a)(4)(A) if both:
• The official’s only financial interest in the business is an “investment interest” under Section 87103(a) valued at $25,000 or less; and
• The official’s interest in the business is less than one percent of the business’s shares.
If the Small Shareholder Exception applies, the official is not disqualified.
B. Real Property Interests
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Regulation 18702.2 provides the materiality standards applicable to a decision’s reasonably foreseeable financial effect on real property in which an official has an interest as either an owner or lessee.
Explicitly Involved Real Property Interest: It is reasonably foreseeable a decision will have a material financial effect on an official’s interest in real property any time the interest is explicitly involved in the decision. Therefore, the decision’s reasonably foreseeable effect is material in any of the types of decisions described in Regulation 18702.2(a)(1) to (6), including a decision that:
• Involves the adoption of or amendment to a development plan or criteria applying to the property. (Regulation 18702.2(a)(1).)
• Determines the property’s zoning or rezoning, other than a zoning decision applicable to all properties designated in that category; annexation or deannexation; inclusion in or exclusion from any city, county, district, or local government subdivision or other boundaries, other than elective district boundaries. (Regulation 18702.2(a)(2).)
• Would impose, repeal, or modify any taxes, fees, or assessments that apply to the property. (Regulation 18702.2(a)(3).)
• Authorizes the sale, purchase, or lease of the property. (Regulation 18702.2(a)(4).)
• Involves the issuance, denial or revocation of a license, permit or other land use entitlement authorizing a specific use of or improvement to the property or any variance that changes the permitted use of, or restrictions placed on, the property. (Regulation 18702.2(a)(5).)
• Involves construction of, or improvements to, streets, water, sewer, storm drainage or similar facilities, and the property will receive new or improved services that provide a benefit or detriment disproportionate to other properties receiving the services. (Regulation 18702.2(a)(6).)
Not Explicitly Involved Real Property Interest: A decision’s reasonably foreseeable financial effect on an official’s interest in real property is material if it is of a type described in Regulation 18702.2(a)(7) through (8), (b) or (c), including a decision that:
• Involves property located 500 feet or less from the official’s property unless there is clear and convincing evidence that the decision will not have any measurable impact on the official’s property. (Regulation 18702.2(a)(7).) • Involves property located more than 500 feet but less than 1,000 feet from the official’s property, and the decision would change the official’s property’s:
development potential; income producing potential; highest and best use; character by substantially altering traffic levels, intensity of use, parking, view, privacy, noise levels, or air quality; or market value (Regulation 18702.2(a)(8)(A) through (E).)
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• Involves property located 1,000 feet or more from the property line of the official’s property if there is clear and convincing evidence the decision would have a substantial effect on the official’s property. (Regulation 18702.2(b).) • Involves property leased by the official and the decision will:
Change the termination date of the lease;
Increase or decrease the potential rental value of the property; Change the official’s actual or legally allowable use of the property; or Change the official’s use and enjoyment of the property. (Regulation 18702.2(c)(1) through (4).)
Real Property Interest 1,000 Feet or More from Property Involved in Decision: As mentioned above, Regulation 18702.2(b) sets forth a presumption that the financial effect of a decision involving property located 1,000 feet or more from the property line of the official’s property is not material. That presumption, however, may be rebutted with clear and convincing evidence the decision would have a substantial effect on the official’s real property interest.
Exceptions for Planning Objectives or Policy: A decision’s reasonably foreseeable financial effect on an official’s real property interest is not material, and therefore the official is not disqualified from the decision, if the decision solely concerns:
• Repairs, replacement or maintenance of existing streets, water, sewer, storm drainage or similar facilities. (Regulation 18702.2(d)(1).) • Adoption or amendment of a general plan, as defined in Regulation 18702.2(e)(2), if certain specified conditions are met. (See Regulation 18702.2(d)(2).)
Common Area Exception to the Definition of Interest in Real Property: Regulation 18702.2(e)(4) provides that an “interest in real property,” as defined in Section 82033, does not include “any common area as part of the official’s ownership interest in a common interest development as defined in the Davis-Stirling Common Interest Development Act (Civil Code Sections 4000 et seq.)”
C. Source of Income Interests
Regulation 18702.3 sets forth the materiality standards applicable to a decision’s reasonably foreseeable financial effect on a source of income to an official, and provides that the effect is material if any of the following criteria is met:
• The source is explicitly involved in the decision because it is “a named party in, or the subject of, the decision,” including a claimant, applicant, respondent, or contracting party. (Regulation 18702.3(a)(1).)
• The source is an individual and any of the following applies:
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The decision may affect the individual’s income, investments, or other assets or liabilities by $1,000 or more (excluding an interest in a business entity or real property). (Regulation 18702.3(a)(2)(A).)
The official knows or has reason to know that the individual has an interest in a business entity that will be financially affected under the materiality standards applicable to a business set forth in Regulation 18702.1. (Regulation 18702.3(a)(2)(B).)
The official knows or has reason to know that the individual: (i) has a real property interest and the property is explicitly involved in the decision; or (ii) there is clear and convincing evidence the decision would have a substantial effect on the property. (Regulation 18702.3(a)(2)(C).)
• The source is a nonprofit organization and any of the following applies:
The decision may result in an increase or decrease of the organization’s annual gross receipts, or the value of the organization’s assets or liabilities, in an amount equal to or more than: (i) $1,000,000; or (ii) five percent of the organization’s annual gross receipts and the increase or decrease is equal to or greater than $10,000. (Regulation 18702.3(a)(3)(A).) The decision may cause the organization to incur or avoid additional expenses or to reduce or eliminate expenses in an amount equal to or more than: (i) $250,000; or (ii) one percent of the organization’s annual gross receipts and the change in expenses is equal to or greater than $2,500. (Regulation 18702.3(a)(3)(B).)
The official knows or has reason to know that the organization has a real property interest and: (i) the property is explicitly involved in the decision; (ii) there is clear and convincing evidence the decision would have a substantial effect on the property. (Regulation 18702.3(a)(3)(C).)
• The source is a business that will be financially affected under the materiality standards applicable to a business set forth in Regulation 18702.1 (Regulation 18702.3(a)(4).)
• If there is a nexus between the decision and income received by the official or official’s spouse. Otherwise referred to as the nexus test, any reasonably foreseeable financial effect on an official’s source of income interest is material if the decision “will achieve, defeat, aid, or hinder a purpose or goal of the source and the official or the official’s spouse receive or is promised the income for achieving the purpose or goal. (Regulation 18702.3(b).) Exception for Retail Sales: Section 87103.5(a) provides that a retail customer of a business engaged in retail sales of good or services to the public generally is not a source of income to an official who owns a 10-percent or greater interest in the business if: the retail customers of the business constitute a significant segment of the public generally, and the amount of income received from an individual customer is not distinguishable from the amount of income received from its other customers.
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Section 87103.5(b) sets forth a similar retail sales exception for a jurisdiction with a population of 10,000 or less that is located within a county with 350 or fewer retail businesses.
For purposes of applying Section 87103.5, Regulation 18702.3(c) provides that the retail customers of a business entity constitute a significant segment of the public generally if the business is open to the public and provides goods or services to customers that comprise a broad base of persons representative of the jurisdiction. (Regulation 18702.3(c)(1).)
Income from an individual customer is not distinguishable from the amount of income received from other customers when the official is unable to recognize a significant monetary difference between the business provided by the individual customer and the other customers of the business. (Regulation 18702.3(c)(2).) An official is unable to recognize a significant monetary difference when the business:
• Is of the type that sales to any one customer will not have a significant impact on the business’s annual net sales; or
• Has no records that distinguish customers by amount of sales, and the official has no other information that the customer provides significantly more income to the business than an average customer. (Ibid.)
Income from a Government Entity: The materiality standards of Regulation 18702.3 do not apply where a government entity qualifies as a source of income as defined in Section 82030, including where an official is paid by the entity as a consultant or contractor. (Regulation 18702.3(d).) Under Regulation 18703(e)(7), an official with an interest in such an entity is disqualified from taking part in a decision only if there is a unique effect on the official. (Ibid.)
D. Source of Gift Interests
Regulation 18702.4 provides the materiality standards applicable to a decision’s reasonably foreseeable financial effect on the source of a gift to an official, and provides that the decision’s effect is material if:
• The source is explicitly involved in the decision because the source “is named or otherwise identified as the subject of the proceeding,” including a claimant, applicant, respondent, or contracting party. (Regulation 18702.4(a).) • The source is an individual that will be financially affected under the materiality standard applicable to a decision’s reasonably foreseeable financial effect on an official’s personal finances set forth in Regulation 18702.5 or the official knows or has reason to know that the individual has an interest in a business or real property that will be financially affected under the materiality standards provided in Regulation 18702.1 or 18702.2, respectively. (Regulation 18702.4(b)) Fair Political Practices Commission 11 Conflicts Overview May 2022
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• The source is a nonprofit organization that will receive a measurable financial benefit or loss as a result of the decision or the official knows or has reason to know that the nonprofit has an interest in real property that will be financially affected under the materiality standards in Regulation 18702.2. (Regulation 18702.4(c).)
• The source is a business that will be financially affected under the materiality standards in Regulation 18702.1. (Regulation 18702.4(d).) E. Interest in Personal Finances
Regulation 18702.5(a) provides the materiality standard applicable to a decision’s reasonably foreseeable financial effect on an official’s personal finances, including those of immediate family. Also known as the personal financial effect rule, a reasonably foreseeable effect on the official’ personal finances is material if the decision may result in the official or the official’s immediate family receiving a financial benefit or loss of $500 or more in any 12-month period due to the decision.
Exceptions: Under Regulation 18702.5(b), however, a decision’s effect on an official’s personal finances and those of immediate family is not material if the decision would:
• Affect only the salary, per diem, or reimbursement for expenses the official or their immediate family member receives from a federal, state, or local government agency, unless the decision is:
To appoint (except as specified), hire, fire, promote, demote, suspend without pay or otherwise take disciplinary action with financial sanction against the official or their immediate family; or
To set a salary for the official or a member of their immediate family which is different from salaries paid to other employees of the government agency in the same job classification or position, or when the member of the official’s immediate family is the only person in the job classification or position. (Regulation 18702.5(b)(1).)
• Appoint the official to be a member of any group or body created by law or formed by the official’s agency for a special purpose. However, if the official will receive a stipend for attending meeting of the group or body aggregating $500 or more in any 12-month period, the effect is material unless the appointing body posts all of the following on its website:
A list of each appointed position and its term. (Regulation 18702.5(b)(2)(A).) The amount of the stipend for each appointed position. (Regulation 18702.5(b)(2)(B).)
The name of the official who has been appointed to the position. (Regulation 18702.5(b)(2)(C).)
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The name of any official who has been appointed to be an alternate for the position. (Regulation 18702.5(b)(2)(D).)
• Appoint the official to be an officer of the governing body of which the official is already a member (such as a decision to appoint a city councilmember to be the city’s mayor.) (Regulation 18702.5(b)(3).)
• Establish or change the benefits or retirement plan of the official or the official’s immediate family member, and the decision applies equally to all employees or retirees in the same bargaining unit or other representative group. (Regulation 18702.5(b)(4).)
• Result in the payment of any travel expenses incurred by the official or their immediate family while attending a meeting as an authorized representative of an agency. (Regulation 18702.5(b)(5).)
• Permit the official’s use of any government property, including automobiles or other modes of transportation, mobile communication devices, or other agencyprovided equipment for carrying out the official’s duties, including any nominal, incidental, negligible, or inconsequential personal use while on duty. (Regulation 18702.5(b)(6).)
• Result in the official’s receipt of any personal reward from their use of a personal charge card or participation in any other membership rewards program, so long as the reward is associated with the official’s approved travel expenses and is no different from the reward offered to the public. (Regulation 18702.5(b)(7).) Effect on Personal Finances and a Business or Real Property Interest: If a decision would have a reasonably foreseeable financial effect on a business or real property interest of an official, any related effect on the official’s personal finances is not considered separately, and the effect is only analyzed under the respective materiality standards for business and real property interests, i.e. Regulations 18702.1 and 18702.2. (Regulation 18702.5(c).)
VI. The Public Generally Exception
Under Section 87103, if a decision’s financial effect on an official’s financial interest is indistinguishable from the decision’s effect on the public generally, the official is not disqualified from taking part in the decision. Regulation 18703 sets forth the “Public Generally Exception.”
The General Rule: A decision’s financial effect on an official’s financial interest is indistinguishable from its effect on the public generally if the official establishes that a “significant segment” of the public is affected and the “effect on the official’s interest is not unique” compared to the effect on the significant segment. (Regulation 18703(a).) A “significant segment” of the public is defined as:
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• At least 25 percent of:
All businesses or nonprofit entities within the official’s jurisdiction; All real property, commercial real property, or residential real property within the official’s jurisdiction; or
All individuals within the official’s jurisdiction. (Regulation 18703(b)(1).) • At least 15 percent of residential real property within the official’s jurisdiction if the only interest the official has in the decision is the official’s primary residence. (Regulation 18703(b)(2).)
A unique effect on an official’s financial interest includes a disproportionate effect on:
• The development potential or use of the official’s real property, or the income producing potential of the official’s real property or business; • An official’s business or real property resulting from the proximity of a project that is the subject of a decision;
• An official’s interests in business entities or real properties resulting from the cumulative effect of the official’s multiple interests in similar entities or properties that is substantially greater than the effect on a single interest; • An official’s interest in a business or real property resulting from the official’s substantially greater business volume or larger real property size when a decision affects all interests by the same or similar rate or percentage; • A person’s income, investments, assets or liabilities, or real property if the person is a source of income or gifts to the official; and
• An official’s personal finances or those of immediate family. (Regulation 18703(c)(1)-(6).)
“Jurisdiction” means:
• The jurisdiction of the state or local government agency as defined in Section 82035;
• The designated geographical area the official was elected to represent; or • The area to which the official’s authority and duties are limited if not elected. (Regulation 18703(d).)
Specific Rules for Special Circumstances: Regulation 18703(e) also provides seven Specific Rules for Special Circumstances which govern the Public Generally Exception’s applicability in those special circumstances. Under these rules, a decision’s financial effect is deemed indistinguishable from its effect on the public generally if there is no unique effect on the official’s interest and the official establishes:
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• Public Services and Utilities: The decision sets or adjusts the amount of an assessment, tax, fee, or rate for water, utility, or other similar public services that is applied equally, proportionally, or by the same percentage to the official’s interest and other businesses, properties, or individuals subject to the assessment, tax, fee, or rate. However, an official is not permitted to take part in a decision that would impose the assessment, tax, or fee, or determine the boundaries of a property or who is subject to the assessment, tax, or fee. An official is only permitted to take part in setting or adjusting the assessment, tax, or fee amount, once other related decisions have already been made. (Regulation 18703(e)(1).)
• General Use or Licensing Fees: The decision affects the official’s personal finances as a result of an increase or decrease to a general fee or charge, such as parking rates, permits, license fees, application fees, or any general fee that applies to the entire jurisdiction. (Regulation 18703(e)(2).) • Limited Neighborhood Effects: The decision affects residential real property limited to a specific location, encompassing more than 50, or five percent, of the residential real properties in the official’s jurisdiction, and the decision establishes, amends, or eliminates ordinances that restrict on-street parking, impose traffic controls, deter vagrancy, reduce nuisance or improve public safety, provided the body making the decision gathers sufficient evidence to support the need for the action at a specific location. (Regulation 18703(e)(3).) • Rental Properties: The decision is limited to establishing, eliminating, amending, or otherwise affecting the respective rights or liabilities of tenants and owners of residential rental property, including a decision regarding a rent control ordinance or tenant protection measures, provided all of the following criteria are met:
The decision applies to all residential rental properties within the official’s jurisdiction other than those excepted by the Costa-Hawkins Rental Housing Act (Civil Code Sections 1954.50, et seq.). (Regulation 18703(e)(4)(A).) The official owns three or fewer residential rental units. (Regulation 18703(e)(4)(B).)
Only interests resulting from the official’s leasehold interest as a lessor of residential real property and the lessee or owner of the official’s primary residence are affected by the decision. (Regulation 18703(e)(4)(C).) • Required Representative Interest: The decision is made by a board or commission and the law that establishes the board or commission requires certain appointees have a representative interest in a particular industry, trade, or profession or other identified interest, and the public official is an appointed member representing that interest. This provision applies only if the effect is on the industry, trade, or profession or other identified interest represented. (Regulation 18703(e)(5).)
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• State of Emergency: The decision is made pursuant to an official proclamation of a state of emergency when required to mitigate against the effects directly arising out of the emergency. (Regulation 18703(e)(6).) • Governmental Entities: The decision affects a federal, state, or local government entity in which the official has an interest. (Regulation 18703(e)(7).) VII. Legally Required Participation
Section 87101 provides that the prohibition of Section 87100 does not prevent an official from making or participating in the making of a decision to the extent the official’s participation is legally required for the action or decision to be made. However, the existence of a tied vote does not make the disqualified official’s participation legally required.
No Alternative Source of Decision: Regulation 18705(a) provides that an official who is financially interested in a decision may establish that the official is legally required to make or to participate in the making of a decision within the meaning of Section 87101 only if there exists no alternative source of decision consistent with the purposes and terms of the statute authorizing the decision.
“Quorum” Defined: Regulation 18705(d) provides that a “quorum” is the minimum number of members required to conduct business. When the vote of a supermajority is required to adopt an item, a “quorum” is the minimum number of members needed to adopt the item.
Narrowly Construed: Regulation 18705(c) requires the regulation be narrowly construed, and specifically provides that the regulation shall not to be construed:
• To permit an official who is otherwise disqualified under Section 87100 to vote to break a tie. (Regulation 18705(c)(1).)
• To allow a member of any agency who is otherwise disqualified under Section 87100 to vote if a quorum can be convened of other members of the agency who are not disqualified, whether or not those other members are actually present at the time of the disqualification. (Regulation 18705(c)(2).) Random Means of Selection: Regulation 18705(c)(3) requires participation by the smallest number of officials with a conflict that are “legally required” for the decision to be made under Section 87101 and permits a “random means of selection” (e.g. drawing straws) to be used to select only the number of officials necessary to make the decision.
When an official is selected, that official is selected for the duration of the proceedings in all related matters until their participation is no longer legally required, or the need for invoking the exception no longer exists. (Regulation 18705(c)(3).) Fair Political Practices Commission 16 Conflicts Overview May 2022
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Public Identification of an Otherwise Disqualified Official’s Financial Interests in a Decision: Regulation 18705(b) provides that when an official who has a financial interest in a decision is legally required to make or participate in making that decision, the official must state the existence of the potential conflict as follows:
• The official must disclose the existence of the conflict of interest and describe with particularity the nature of the official’s disqualifying financial interest or interests. This requirement is satisfied if the official discloses:
The type of financial interest or interests involved in the decision, and; Other specified information identifying the interest depending on the type of interest at issue.
• The official or another officer or employee of the agency must summarize the circumstances under which the conflict may arise.
• The official or another officer or employee of the agency must disclose the legal basis for the determination that there is no alternative source of decision.
Manner of Disclosure: The disclosures required by Regulation 18705(b) must be disclosed as follows:
• If the decision is made during an open session of a public meeting, the disclosures must be made orally before the decision is made; • If the decision is made during a closed session of a public meeting, the disclosures must be made orally during open session either before the body goes into closed session or immediately thereafter;
• If the decision takes place outside of a public meeting, the disclosures must be made in writing; and
• In all three circumstances immediately above, the disclosures must be made part of the public record, as specified. (Regulation 18705(b)(4).) VIII. Segmentation
Under the Act’s conflict of interest provisions, each governmental decision must be analyzed independently to determine if the decision will have a disqualifying effect on an official’s financial interest. (In re Owen (1976) 2 FPPC Ops. 77.) Accordingly, an agency may segment a decision in which an official has a disqualifying conflict of interest to allow the official to participate in associated decisions which would not have a disqualifying effect on the official’s interests under Regulation 18706.
Required Conditions for Segmentation: Regulation 18706(a) provides that an agency may segment a decision in which an official is financially interested, to allow the official Fair Political Practices Commission 17 Conflicts Overview May 2022
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to participate in associated decisions in which the official is not financially interested, provided all the following conditions are met:
• The decision in which the official is financially interested can be broken down into separate decisions that are not inextricably interrelated to the decision in which the official has a disqualifying financial interest;
• The decision in which the official is financially interested is segmented from the other decisions;
• The decision in which the official is financially interested is considered first and a final decision is reached by the agency without the disqualified official’s participation in any way; and
• Once the decision in which the official is financially interested has been made, the official’s participation in associated decisions does not result in a reopening of, or otherwise financially affect, the decision from which the official was disqualified.
“Inextricably Interrelated”: Regulation 18706(b) provides that decisions are “inextricably interrelated” when the result of one decision will effectively determine, affirm, nullify, or alter the result of another decision.
Budget and General Plan Decisions Affecting Entire Jurisdiction: Regulation 18706(c) provides that once all separate decisions related to a budget or general plan affecting the entire jurisdiction have been finalized, the official may participate in the final vote to adopt or reject the agency’s budget or general plan.
IX. Disqualification Requirements
Section 87105 governs the recusal of a public official specified in Section 87200 from a decision from which the official has been disqualified. Subdivisions (a)(1)-(3) of that section require the disqualified official to: identify the potential conflict of interest to publicly identify the official’s financial interest or interests at issue; recuse from voting, discussing or attempting to influence the matter; and leave the room until after the matter is concluded. Subdivision (a)(4) excludes members of the Legislature from these recusal requirements.
Regulation 18707 provides further direction and guidance on the recusal requirements applicable to a public official specified in Section 87200 who is disqualified from a decision relating to an agenda item noticed for consideration at a public meeting subject to open meeting laws (i.e. the Bagley-Keene Act (Section 11120 et seq.) or the Brown Act (Section 54950 et seq.)).
Form and Content of Public Identification: The disqualified official must publicly identify each type of financial interest, identified in Section 87103, held by the official Fair Political Practices Commission 18 Conflicts Overview May 2022
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that gives rise to the disqualifying conflict of interest. (Regulation 18707(a)(1).) The identification must be oral and part of the public record (Regulation 18707(a)(1)(B)), and provide the following information, as applicable:
• For a business interest: the name of the business, a general description of its activities, and any position held by the official. (Regulation 18707(a)(1)(A)(i).) • For a real property interest: the property’s address, assessor’s number, or identification that the property is the official’s personal residence. (Regulation 18707(a)(1)(A)(ii).)
• For a source of income interest: the name of the source of income. (Regulation 18707(a)(1)(A)(iii).)
• For a source of gift interest: the name of the source of gift. (Regulation 18707(a)(1)(A)(iv).)
• For all interests: the nature of the expense, liability, asset, or income affected. (Regulation 18707(a)(1)(A)(v).)
Timing: The public identification required by Regulation 18707(a)(1) must be made immediately prior to consideration of the agenda item. (Regulation 18707(a)(2).) • Partial absence from a meeting does not excuse the disqualified official’s public identification requirement. (Ibid.)
• If the official leaves a meeting in advance of an agenda item from which the official is disqualified, the official must provide the public identification required by Regulation 18707(a)(1) prior to leaving the meeting. (Regulation 18707(a)(2).) • If the official first joins a meeting after consideration of the agenda item, the official must provide the public identification immediately upon joining the meeting. (Ibid.)
Recusal and Leaving the Room: The disqualified official must recuse, leave the room after the public identification required by Regulation 18707(a)(1), and refrain from participation in the decision. (Regulation 18707(a)(3).) The disqualified official does not count toward achieving a quorum while the item is discussed. (Ibid.) • For an agenda item on a consent calendar (uncontested items), the official may remain in the room during the consent calendar. (Regulation 18707(a)(3)(A).) • If the official has a “personal interest” in the agenda item, as defined in Regulation 18704(d)(2) and wishes to speak or appear as a member of the general public, the official may leave the dais and speak or observe from the area reserved for members of the public after making the public identification required by Regulation 18707(a)(1) and recusing. (Regulation 18707(a)(3)(B).) Special Rules for Closed Session: The public identification required by Regulation 18707(a)(1) must be made orally during the open session before the body goes into Fair Political Practices Commission 19 Conflicts Overview May 2022
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closed session and may be limited to a declaration that the official’s recusal is because of a conflict of interest under Section 87100. (Regulation 18707(a)(4).) The declaration must be made part of the official public record. (Ibid.) The official must not be present when the decision is considered in closed session or knowingly obtain or review a recording or any other non-public information regarding the decision. (Ibid.) Other Decisions: For a decision other than an agenda item involving a public official specified in Section 87200 (governed by Regulation 18707(a)), Regulation 18707(b) provides the following:
• If the official determines not to act because of a financial interest, the official’s determination may be accompanied by an oral or written disclosure of the interest.
• The official’s presence will not be counted toward achieving a quorum. • During a closed meeting of the agency, a disqualified official must not be present when the decision is considered, or knowingly obtain or review a recording or any other nonpublic information regarding the decision.
• An agency may adopt a local rule requiring the official to step down from the dais or leave the chambers.
Confidential Information: Regulation 18707(c) expressly provides that nothing in Regulation 18707 is intended to cause any disclosure that would reveal the confidences of a closed session or any other privileged information contemplated by law, including privileged information under Regulation 18740.
1 The Political Reform Act is contained in Government Code Sections 81000 through 91014. All statutory references are to the Government Code, unless otherwise indicated. The regulations of the Fair Political Practices Commission (the “Commission”) are contained in Sections 18110 through 18997 of Title 2 of the California Code of Regulations. All regulatory references are to Title 2, Division 6 of the California Code of Regulations, unless otherwise indicated.
2 We note that the annual gift limit is adjusted biennially. The current gift limit is prescribed in Regulation 18940.2. The adjusted annual gift limit amount in effect for the period January 1, 2021, to December 31, 2022, is $520.
3 For an official’s interest in a business entity or real property, Regulation 18702.1(a) and Regulation 18702.2(a)(1)-(6), provide additional guidance for determining if the interest is explicitly involved.
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Fair Political Practices Commission
Contribution Limits: City and County Candidates1
Introduction
Pursuant to Assembly Bill 571 (Stats. 2019, Ch. 556, AB 571 Mullin), beginning January 1, 2021 a state campaign contribution limit will by default apply to city and county candidates when the city or county has not already enacted a contribution limit on such candidates. Along with the new campaign contribution limit, there are also other related provisions that formerly applied only to state level candidates that will now apply to city and county candidates. Please note that none of the provisions of AB 571 discussed in this fact sheet apply to candidates in cities or counties for which the city or county has enacted campaign contribution limits.
Current State Contribution Limit
The contribution limit that will now apply to city and county candidates pursuant to AB 571 is updated biennially for inflation. Contribution limits can be found in Regulation 18545(a)2 and on the FPPC website’s FPPC Regulations page. The default limit for contributions to city and county candidates subject to AB 571 for 2023-2024 is set at $5,500 per election.
Other Provisions Affecting City and County Candidates
Several other provisions will now apply to city and county candidates in jurisdictions that have not enacted campaign contribution limits, including the following:
· A candidate may not make a contribution over the AB 571 limit to another candidate in jurisdictions subject to the AB 571 limit with limited exceptions related to recall elections, legal defense funds and candidatecontrolled ballot measure committees. (See Regulation 18535 for more information.)
· A candidate that has qualified as a committee must establish a separate controlled committee and campaign bank account for each specific office. Candidates may not redesignate a committee for one election for another election.
· Candidates may transfer non-surplus campaign funds from one candidatecontrolled committee to another committee controlled by the same candidate for a different office if the committee receiving the transfer is for an elective state, county or city office. However, contributions transferred must be attributed and transferred using the “last in, first out” or “first in, first out” accounting method and 184
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shall not exceed the applicable contribution limit per contributor. If a candidate is seeking to transfer campaign funds from one controlled committee to another for the same office a candidate may carry over non-surplus campaign funds raised in connection with one election to pay for campaign expenditures incurred in connection with a subsequent election for the same office without attributing or using the “last in, first out” or “first in, first out” accounting method. (See Regulation 18536 for more information on the transfer and attribution of contributions and See Regulation 18537.1 for more information on carryover of contributions.)1
· Candidates may not personally loan to a candidate’s campaign an amount for which the outstanding balance exceeds $100,000. “Campaign” includes both the primary and general, or special and special runoff, elections. However, a candidate may loan each committee for a different office or term of office up to $100,000. A candidate may not charge interest on any such loan the candidate made to the candidate’s campaign. (See Regulation 18530.8 for more information.)
· Candidates may establish a committee to oppose the qualification of a recall measure and the recall election when the candidate receives a notice of intent to recall. Campaign funds raised to oppose the qualification of a recall measure and/or the recall election would not be subject to any campaign contribution limit under the Act. (See Regulation 18531.5 for more information.) · A candidate for local office may open a candidate-controlled general purpose ballot measure committee to oppose or support a measure being voted on. The committee must identify on its campaign statements and reports each measure for which an expenditure of $100 or more is made. (See Regulations 18421.8 and 18521.5 for more information.)
· Contributions after the date of the election may be accepted to the extent contributions do not exceed net debts outstanding from the election, and contributions do not otherwise exceed applicable contribution limits for that election. (See Regulation 18531.64 for more information.) 1 This fact sheet is informational only and contains only highlights of selected provisions of the law. It does not carry the weight of the law. For further information, consult the Political Reform Act and its corresponding regulations, advice letters, and opinions. 2 The Political Reform Act is contained in Government Code Sections 81000 through 91014. All statutory references are to the Government Code, unless otherwise indicated. The regulations of the Fair Political Practices Commission are contained in Sections 18110 through 18997 of Title 2 of the California Code of Regulations. All regulatory references are to Title 2, Division 6 of the California Code of Regulations, unless otherwise indicated.1
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· Candidates are permitted to raise contributions for a general election before the primary election and may establish separate campaign contribution accounts for the primary and general so long as candidates set aside contributions and use them for the general or special general election as raised. If the candidate is defeated in the primary election or otherwise withdraws from the generalelection, the general election funds must be refunded to contributors on a pro rata basis less any expenses associated with the raising and administration of the general election contributions. (See Regulation 18531.2 for more information.) · Candidates that are currently in office that are running for reelection to the same seat in an election after January 1, 2021 may carry over campaign funds without attribution as mentioned above. Candidates running for a different office also do not need to do LIFO FIFO or attribution for the election immediately subsequent to the election prior to 2021 for which the money was raised. · Candidates must disclose cumulative totals of contributions received or made for each election on campaign statements. (See Regulation 18421.4 for more information.)
FAQs
A. If a city or county does not currently have contribution limits set within their ordinance would the state contribution limit be the default? Yes. The state contribution limit stated above would be the default contribution limit if the city or county ordinance is silent on whether there are contribution limits within that jurisdiction or if there is no city or county ordinance in place.
B. Is there a way for a city or county to adopt “no” contribution limits for city or county elective city and county offices?
Yes. A city or county may elect to have “no” contribution limits. To do so, it must explicitly state in the city or county ordinance that there are no limits on contributions. If it is explicit that the city or county has implemented “no” contribution limits, the state contribution limit will not apply as a default for that jurisdiction.
C. Can a city or county ordinance be less restrictive than the AB 571 limit (e.g., the city or county limit is set higher than the state limit)? Yes. A city or county can set contribution limits higher than the default state limit. 186
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D. If a city or county imposes contribution limits, is the Commissionresponsible for enforcing those limits?
No. The Commission will not regulate the administration or enforcement of the penalties. Cities or counties with existing limits or that adopt their own limits are not subject to the state limit and may impose their own penalties for violations.
E. If a city or county has voluntary contribution limits, but no mandatory contribution limits will the state limit be applicable? Yes. A city or county must enact mandatory contribution limits to avoid the state limit applying to elective city and county offices.
F. Does the default contribution limit also include judicial candidates? No. Elective city and county offices do not include judicial offices.
G. If a city or county has imposed contribution limits for particular city or county offices (e.g., Board of Supervisors), do those limits also apply to other positions such as the District Attorney or would the default state limit apply if a particular position is not specifically addressed by the city or county? The default state limit would apply to other positions for which the city or county has not set contribution limits. A city or county ordinance must explicitly state the city or county contribution limits and for which elective offices those limits will apply. A city or county may adopt a general provision implementing a contribution limit for all elective city and county offices in that jurisdiction. As noted above, a city or county may also adopt an ordinance that states the city or county is adopting no contribution limits for any offices to avoid the default state limit applying.
H. Does AB 571 apply to special district or school district elections? No. AB 571 applies only to city and county elections for offices that a city or county has not implemented its own contribution limit.
I. Does AB 571 apply to the office of County Superintendent of Schools or the office of County Board of Education?
AB 571 does apply to the office of County Superintendent of Schools because it is considered a “county” office. However, the office of County Board of Education is not subject to AB 571 because it’s not considered a “county” position.
J. Can candidates that are subject to the AB 571 contribution limit open an officeholder committee?
No. Officeholder committees are not permitted for candidates subject to the AB 187
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571 contribution limit. However, a candidate may use a committee for the officeholder’s future election for officeholder expenses. A candidate may also use existing funds in the election committee for current office for officeholder expenses.
K. Does the AB 571 contribution limit apply to debt retirement for the 2020 election?
No. For purposes of retiring debt, the contribution limit is the one that was applicable to that election. The Act did not impose a contribution limit on city and county candidates in 2020.
L. If a contribution was received for an election occurring after January 1, 2021, PRIOR to January 1, 2021, does this contribution count towards the new AB 571 contribution limit after January 1, 2021?
No. The Commission adopted a formal opinion on April 15, 2021 that states contributions made prior to the effective date of AB 571 are not aggregated with contributions made on or after the effective date of AB 571 for purposes of the new contribution limit. Therefore, if someone contributed up to or above the current limit to an AB 571 committee prior to January 1, 2021 the same person can give additional contributions to the same committee up to the AB 571 contribution limit on or after January 1, 2021.
M. If a contributor gave $10,000 in 2020 (prior to the AB 571 limit going into effect) to a committee for a 2022 primary election, what happens? The AB 571 contribution limit does not apply to contributions made prior to January 1, 2021 so a contribution of this amount is permissible.
N. Does the AB 571 contribution limit apply to political party committees and small contributor committees making contributions to candidates subject to the AB 571 limit?
Yes. Political parties and small contributor committees are only permitted to give contributions to candidates subject to the AB 571 in amounts up to the applicable AB 571 contribution limit for that candidate.
O. Does the AB 571 limit apply to county central committee candidates? No. AB 571 imposes a contribution limit on city and county elective offices when a local jurisdiction has not already done so. Local jurisdictions are prohibited from placing contribution limits on county central committee candidates; therefore, AB 571 is not applicable to those offices.
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P. If an election was held in November 2023, but resulted in the need for a run-off election to be held in February 2024, how would the contributions be treated under AB 571?
The run-off election is considered a new election. If a contributor gave any amount to an AB 571 candidate for the November 2023 election, the same contributor would still be permitted to contribute up to $5,500 (the AB 571 limit) to the same candidate for the February 2024 run-off election.
Q. An AB 571 candidate for city council would like to send out a request for contributions to their constituents. Do they need to include anything specific in the request?
Yes. A candidate that is subject to AB 571 must have the following information in the solicitation: the name of the controlled committee soliciting contributions, and the specific office for which those contributions will be used.
R. If an AB 571 candidate is the subject of a recall, is their committee to oppose the recall subject to contribution limits?
No. There are no contribution limits for a committee controlled by a candidate that is the subject of a recall that is formed to oppose the recall.
S. An AB 571 candidate has debts for an election held after January 1, 2021, may the candidate terminate their committee?
No. If a candidate-controlled committee has outstanding debts for an election held after January 1, 2021, they may not terminate without resolving or paying off the debt. When the committee has no net debts outstanding, the committee must be terminated within 24 months after the earliest of the date the candidate is defeated, leaves office, or the term of office for which the committee was formed ends, or, for withdrawn candidates no later than 24 months after the election from which the candidate withdrew. Please see Regulation 18404.1 for more on termination requirements for committees subject to AB 571.
T. If a local jurisdiction, which is subject to AB 571, passes a local campaign contribution ordinance, are the candidates still subject to AB 571? No. They would no longer be subject to AB 571.
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Index of Regulations and Government Codes:
FPPC Regulations:
18404.1
18421.4
18421.8
18521
18521.5
18523.1
18530.2
18530.8
18531.2
18531.5
18531.61
18531.63
18531.64
18535
18536
18537.1
18545
18951
Government Code(s):
85301
85303
85304.5
85305
85306
85307
85315
85316
85317
85318
85702.5
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2023/2024 Form
700 Statement of
Economic Interests
Reference
Pamphlet
California Fair Political Practices Commission
1102 Q Street, Suite 3050 • Sacramento, CA 95811
Email advice: [email protected]
Toll-free advice line: 1 (866) ASK-FPPC • (866) 275-3772 Telephone: (916) 322-5660 • Website: www.fppc.ca.gov
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• Who Must File ............................................................................................ Page 3 • Types of Form 700 Filings.......................................................................... Page 4 • Where to File .............................................................................................. Page 5 • When to File ............................................................................................... Page 6 • Terms & Definitions .................................................................................... Page 8 Contents
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Who Must File
1. Officials and Candidates Specified in Gov. Code
Section 87200 and Members of Boards and
Commissions of Newly Created Agencies
The Act requires the following individuals to fully disclose their personal assets and income described in Form 700, Statement of Economic Interests:
State Offices
• Governor
• Lieutenant Governor
• Attorney General
• Controller
• Insurance Commissioner
• Secretary of State
• Treasurer
• Members of the State Legislature
• Superintendent of Public Instruction
• State Board of Equalization Members
• Public Utilities Commissioners
• State Energy Resources Conservation and
Development Commissioners
• State Coastal Commissioners
• Fair Political Practices Commissioners
• State public officials (including employees and
consultants) who manage public investments
• Elected members of and candidates for the Board of
Administration of the California Public Employees’
Retirement System
• Elected members of and candidates for the Teachers’
Retirement Board
• Members of the High Speed Rail Authority
Other officials and employees of state boards,
commissions, agencies, and departments file Form 700 as described in Part 2 on this page.
Judicial Offices
• Supreme, Appellate, and Superior Court Judges
• Court Commissioners
• Retired Judges, Pro-Tem Judges, and part-time Court
Commissioners who serve or expect to serve 30 days
or more in a calendar year
County and City Offices
• Members of Boards of Supervisors
• Mayors and Members of City Councils
• Chief Administrative Officers
• District Attorneys
• County Counsels
• City Attorneys
• City Managers
• Planning Commissioners
• County and City Treasurers
• County and city public officials (including employees and consultants) who manage public investments
Members of Newly Created Boards and Commissions
Generally, such a member must file an assuming office
statement within 30 days as well as subsequent statements until the member’s position is designated in a conflict of interest code. See Regulation 18754.
2. State and Local Officials, Employees, Candidates,
and Consultants Designated in a Conflict of Interest
Code (“Code Filers”)
The Act requires every state and local government agency to adopt a unique conflict of interest code. The code lists each position within the agency filled by individuals who make or participate in making governmental decisions that could affect their personal economic interests.
The code requires individuals holding those positions
to periodically file Form 700 disclosing certain personal economic interests as determined by the code’s “disclosure categories.” These individuals are called “designated
employees” or “code filers.”
Obtain your disclosure categories from your agency – they are not contained in the Form 700. Persons with broad
decisionmaking authority must disclose more interests than those in positions with limited discretion. For example, you may be required to disclose only investments and business positions in or income (including loans, gifts, and travel payments) from businesses of the type that contract with your agency, or you may not be required to disclose real property interests.
In addition, certain consultants to public agencies may qualify as public officials because they make, participate in making, or act in a staff capacity for governmental decisions.
Agencies determine who is a consultant and the level of disclosure and may use Form 805.
Note: An official who holds a position specified in Gov. Code Section 87200 is not required to file statements under the conflict of interest code of any agency that has the same or a smaller jurisdiction (for example, a state legislator who also sits on a state or local board or commission).
Employees in Newly Created Positions of Existing Agencies An individual hired for a position not yet covered under an agency’s conflict of interest code must file Form 700 if the individual serves in a position that makes or participates in making governmental decisions. These individuals must
file under the agency’s broadest disclosure category until the code is amended to include the new position unless
the agency has provided in writing a limited disclosure requirement. The Form 804 may be used to satisfy this
requirement.
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Types of Form 700 Filings
Assuming Office Statement:
If you are a newly appointed official or are newly employed in a position designated, or that will be designated, in a state or local agency’s conflict of interest code, your assuming office date is the date you were sworn in or
otherwise authorized to serve in the position. If you are a newly elected official, your assuming office date is the date you were sworn in.
• Report: Investments, interests in real property, and
business positions held on the date you assumed the
office or position must be reported. In addition, income (including loans, gifts, and travel payments) received
during the 12 months prior to the date you assumed the
office or position.
For positions subject to confirmation by the State Senate or the Commission on Judicial Appointments, your
assuming office date is the date you were appointed or
nominated to the position.
• Example: Maria Lopez was nominated by the Governor
to serve on a state agency board that is subject to state Senate confirmation. The assuming office date is the
date Maria’s nomination is submitted to the Senate.
Maria must report investments, interests in real
property, and business positions she holds on that date, and income (including loans, gifts, and travel payments) received during the 12 months prior to that date.
If your office or position has been added to a newly
adopted or newly amended conflict of interest code, use the effective date of the code or amendment, whichever is applicable.
• Report: Investments, interests in real property, and
business positions held on the effective date of the
code or amendment must be reported. In addition,
income (including loans, gifts, and travel payments)
received during the 12 months prior to the effective date of the code or amendment.
Annual Statement:
Generally, the period covered is January 1, 2023,
through December 31, 2023. If the period covered by
the statement is different than January 1, 2023, through December 31, 2023, (for example, you assumed office
between October 1, 2022, and December 31, 2022 or
you are combining statements), you must specify the
period covered.
• Investments, interests in real property, business
positions held, and income (including loans, gifts, and travel payments) received during the period covered by
the statement must be reported. Do not change the
preprinted dates on Schedules A-1, A-2, and B unless
you are required to report the acquisition or disposition of an interest that did not occur in 2023.
• If your disclosure category changes during a
reporting period, disclose under the old category
until the effective date of the conflict of interest code amendment and disclose under the new disclosure
category through the end of the reporting period.
Leaving Office Statement:
Generally, the period covered is January 1, 2023,
through the date you stopped performing the duties of
your position. If the period covered differs from January 1, 2023, through the date you stopped performing the
duties of your position (for example, you assumed office between October 1, 2022, and December 31, 2022, or
you are combining statements), the period covered must
be specified. The reporting period can cover parts of two calendar years.
• Report: Investments, interests in real property, business positions held, and income (including loans, gifts, and travel payments) received during the period covered by
the statement. Do not change the preprinted dates on
Schedules A-1, A-2, and B unless you are required to
report the acquisition or disposition of an interest that did not occur in 2023.
Candidate Statement:
If you are filing a statement in connection with your
candidacy for state or local office, investments, interests in real property, and business positions held on the date of filing your declaration of candidacy must be reported.
In addition, income (including loans, gifts, and travel payments) received during the 12 months prior to the date of filing your declaration of candidacy is reportable. Do not change the preprinted dates on Schedules A-1, A-2, and B.
Candidates running for local elective offices (e.g., county sheriffs, city clerks, school board trustees, or water
district board members) must file candidate statements, as required by the conflict of interest code for the elected position. The code may be obtained from the agency of
the elected position.
Amendments:
If you discover errors or omissions on any statement,
file an amendment as soon as possible. You are only
required to amend the schedule that needs to be revised; it is not necessary to refile the entire form. The amended schedule(s) is attached to your original filed statement.
Obtain amendment schedules from the FPPC website at
www.fppc.ca.gov.
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Where to File
1. Officials Specified in Gov. Code Section 87200
(See Reference Pamphlet, page 3):
In most cases, the filing officials listed below will retain a copy of your statement and forward the original to the FPPC.
Filers Where to File
87200 Filers
State offices
Judicial offices
Retired Judges
County offices
City offices
Multi-County offices
Your agency
The clerk of your court
Directly with FPPC
Your county filing official
Your city clerk
Your agency
87200 Candidates
State offices
Judicial offices
Multi-County offices
County offices
City offices
Public Employees’
Retirement System
(CalPERS)
State Teachers’
Retirement Board
(CalSTRS)
County elections official with
whom you file your declaration
of candidacy
County elections official
City Clerk
CalPERS
CalSTRS
Note: Individuals that invest public funds for a city or county agency must file Form 700 with the agency. Unlike most other 87200 filers, the original statement will not be forwarded to the FPPC pursuant to Regulation 18753.
2. Code Filers — State and Local Officials,
Employees, Candidates, and Consultants
Designated in a Conflict of interest Code:
File with your agency, board, or commission unless
otherwise specified in your agency’s conflict of interest code. In most cases, the agency, board, or commission
will retain the statements.
Candidates for local elective offices designated in a conflict of interest code file with the elections office where the declaration of candidacy or other nomination documents
are filed.
3. Members of Newly Created Boards and
Commissions:
File with your agency or with your agency’s code reviewing body. See Regulation 18754.
State Senate and Assembly staff members file statements directly with the FPPC.
Exceptions:
• Elected state officers are not required to file statements under any agency’s conflict of interest code.
• Filers listed in Section 87200 are not required to file statements under any agency’s conflict of interest
code in the same jurisdiction. For example, a county
supervisor who is appointed to serve in an agency with
jurisdiction in the same county has no additional filing obligations.
4. Positions Not Yet Covered Under a Conflict of
interest Code
An individual hired for a position not yet covered under an agency’s conflict of interest code must file Form 700 if the individual serves in a position that makes or participates in making governmental decisions. These individuals must
file under the broadest disclosure category until the code is amended to include the new position unless the agency has provided in writing a limited disclosure requirement.
Agencies may use FPPC Form 804 for this disclosure.
Such individuals are referred to as “code filers.” See Regulation 18734.
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When to File
Assuming Office Statements:
Filer Deadline
Elected officials 30 days after assuming office
Appointed positions specified
in Gov. Code Section 87200
or
Members of newly created
boards and commissions
not covered by a conflict of
interest code
30 days after assuming office
or
10 days after appointment
or nomination if subject
to Senate or judicial
confirmation
Other appointed positions
(including those held by newlyhired employees) that are or will be designated in a conflict
of interest code
30 days after assuming office
(30 days after appointment or
nomination if subject to Senate
confirmation)
Positions newly added to a
new or amended conflict of
interest code
30 days after the effective
date of the code or code
amendment
Exceptions:
• Elected state officers who assume office in December
or January are not required to file an assuming office
statement, but will file the next annual statement due. • If you complete a term of office and, within 30 days, begin a new term of the same office (for example, you
are reelected or reappointed), you are not required to
file an assuming office statement. Instead, you will
simply file the next annual statement due.
• If you leave an office specified in Gov. Code Section 87200 and, within 45 days, you assume another
office or position specified in Section 87200 that has
the same jurisdiction (for example, a city planning
commissioner elected as mayor), you are not required
to file an assuming office statement. Instead, you will simply file the next annual statement due.
• If you transfer from one designated position to another designated position within the same agency, contact
your filing officer or the FPPC to determine your filing obligations.
• If a due date falls on a weekend or an official state holiday, the due date is the next regular business day.
Annual Statements:
1. 2.
Elected state officers (including members of the
state legislature, members elected to the Board of
Administration of the California Public Employees’
Retirement System and members elected to the
Teachers’ Retirement Board);
Judges and court commissioners; and
Members of state boards and commissions specified in
Gov. Code Section 87200:
File no later than Friday, March 1, 2024.
County and city officials specified in Gov. Code
Section 87200:
File no later than Tuesday, April 2, 2024.
3. Multi-County officials:
File no later than Tuesday, April 2, 2024.
4. State and local officials and employees designated in a conflict of interest code:
File on the date prescribed in the code (April 2 for most filers).
Exception:
If you assumed office between October 1, 2023, and
December 31, 2023, and filed an assuming office
statement, you are not required to file an annual statement until March 1, 2025, or April 1, 2025, whichever is
applicable. The annual statement will cover the day you assumed office through December 31, 2024.
Incumbent officeholders who file candidate statements
also must file annual statements by the specified
deadlines.
Late statements are subject to a late fine of
$10 per day per position up to $100 for each
day the statement is late.
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When to File - (continued)
Leaving Office Statements:
Leaving office statements must be filed no later than 30 days after leaving the office or position.
Exceptions:
• If you complete a term of office and, within 30 days, begin a new term of the same office (for example, you
are reelected or reappointed), you are not required to
file a leaving office statement. Instead, you will simply file the next annual statement due.
• If you leave an office specified in Gov. Code Section 87200 and, within 45 days, you assume another office
or position specified in Section 87200 that has the same jurisdiction (for example, a city planning commissioner elected as mayor), you are not required to file a leaving office statement. Instead, you will simply file the next annual statement due.
• If you transfer from one designated position to another designated position within the same agency, contact
your filing officer or the FPPC to determine your filing obligations.
Candidate Statements:
All candidates (including incumbents) for offices specified in Gov. Code Section 87200 must file statements no later than the final filing date for their declaration of candidacy.
Candidates seeking a position designated in a conflict of interest code must file no later than the final filing date for the declaration of candidacy or other nomination
documents.
Exception:
A candidate statement is not required if you filed an
assuming office or annual statement for the same
jurisdiction within 60 days before filing a declaration of candidacy or other nomination documents.
Late Statements:
Late statements should be submitted as soon as possible after the filing deadline, in the same manner and place as a timely filed statement.
The filing officer who retains originally-signed or
electronically filed statements of economic interests may impose on an individual a fine for any statement that is filed late. The fine is $10 per day up to a maximum of
$100. Late filing penalties may be reduced or waived under certain circumstances.
Persons who fail to timely file their Form 700 may be
referred to the FPPC’s Enforcement Division (and, in
some cases, to the Attorney General or District Attorney) for investigation and possible prosecution. In addition to the late filing penalties from the filing officer, a fine of up to $5,000 per violation may be imposed.
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Terms & Definitions
The instructions located on the back of each schedule
describe the types of interests that must be reported. The purpose of this section is to explain other terms used in Form 700 that are not defined in the instructions to the schedules or elsewhere.
Blind Trust: See Trusts, Reference Pamphlet, page 16.
Business Entity: Any organization or enterprise operated for profit, including a proprietorship, partnership, firm, business trust, joint venture, syndicate, corporation, or association. This would include a business for which you take business deductions for tax purposes (for example, a small business operated in your home). When reporting a business entity on the Form 700, do not use acronyms for the name of entity, unless it is one that is commonly
understood by the public.
Code Filer: An individual who has been designated in
a state or local agency’s conflict of interest code to file statements of economic interests.
An individual hired on or after January 1, 2023 for a
position not yet covered under an agency’s conflict of
interest code must file Form 700 if the individual serves in a position that makes or participates in making
governmental decisions. These individuals must file under the broadest disclosure category until the code is
amended to include the new position unless the agency
has provided in writing a limited disclosure requirement.
Agencies may use FPPC Form 804 for such disclosure.
See Regulation 18734.
Commission Income: “Commission income” means gross
payments of $500 or more received during the period
covered by the statement as a broker, agent, or
salesperson, including insurance brokers or agents, real estate brokers or agents, travel agents or salespersons, stockbrokers, and retail or wholesale salespersons, among others.
In addition, you may be required to disclose the names of sources of commission income if your pro rata share of the gross income was $10,000 or more from a single source
during the reporting period. If your spouse or registered domestic partner received commission income, you would
disclose your community property share (50%) of that
income (that is, the names of sources of $20,000 or more in gross commission income received by your spouse or
registered domestic partner).
Report commission income as follows:
• If the income was received through a business entity in which you and your spouse or registered domestic
partner had a 10% or greater ownership interest (or if
you receive commission income on a regular basis as
an independent contractor or agent), use Schedule A-2.
The “source” of commission income generally includes all parties to a transaction, and each is attributed the full value of the commission.
Examples:
• You are a partner in Jameson and Mulligan Insurance
Company and have a 50% ownership interest in the
company. You sold two American Insurance Company
policies to XYZ Company during the reporting period.
You received commission income of $5,000 from the
first transaction and $6,000 from the second. On
Schedule A-2, report your partnership interest in and
income received from Jameson and Mulligan Insurance
Company in Parts 1 and 2. In Part 3, list both American Insurance Company and XYZ Company as sources of
$10,000 or more in commission income.
• You are a stockbroker for Prince Investments, but you have no ownership interest in the firm. You receive
commission income on a regular basis through the
sale of stock to clients. Your total gross income from your employment with Prince Investments was over
$100,000 during the reporting period. On Schedule
A-2, report your name as the name of the business
entity in Part 1 and the gross income you have
received in Part 2. (Because you are an employee of
Prince Investments, you do not need to complete the
information in the box in Part 1 indicating the general description of business activity, fair market value, or nature of investment.) In Part 3, list Prince Investments and the names of any clients who were sources of
$10,000 or more in commission income to you.
• You are a real estate agent and an independent
contractor under Super Realty. On Schedule A-2,
Part 1, in addition to your name or business name,
complete the business entity description box. In
Part 2, identify your gross income. In Part 3, for each transaction that resulted in commission income to you
of $10,000 or more, you must identify the brokerage
entity, each person you represented, and any person
who received a finder’s or other referral fee for
referring a party to the transaction to the broker.
Note: If your pro rata share of commission income from
a single source is $500 or more, you may be required to disqualify yourself from decisions affecting that source of income, even though you are not required to report the
income. (See Reference Pamphlet, page 12.)
• If the income was received through a business entity in which you or your spouse or registered domestic
partner did not receive commission income on a
regular basis or you had a less than 10% ownership
interest, use Schedule C.
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Terms & Definitions - (continued)
Conflict of Interest: A public official or employee has a conflict of interest under the Act when all of the following occur:
• The official makes, participates in making, or uses their official position to influence a governmental decision; • It is reasonably foreseeable that the decision will affect the official’s economic interest;
• The effect of the decision on the official’s economic interest will be material; and
• The effect of the decision on the official’s economic interest will be different than its effect on the public generally.
Conflict of Interest Code: The Act requires every state and local government agency to adopt a conflict of interest code. The code may be contained in a regulation, policy statement, or a city or county ordinance, resolution, or other document.
An agency’s conflict of interest code must designate all officials and employees of, and consultants to, the agency who make or participate in making governmental decisions that could cause conflicts of interest. These individuals are required by the code to file statements of economic interests and to disqualify themselves when conflicts of interest occur.
The disclosure required under a conflict of interest code for a particular designated official or employee should include only the kinds of personal economic interests
they could significantly affect through the exercise of their official duties. For example, an employee whose duties are limited to reviewing contracts for supplies, equipment, materials, or services provided to the agency should be required to report only those interests they hold that are likely to be affected by the agency’s contracts for supplies, equipment, materials, or services.
Consultant: An individual who contracts with or whose
employer contracts with state or local government
agencies and who makes, participates in making, or acts in a staff capacity for making governmental decisions. The agency determines who is a consultant. Consultants may
be required to file Form 700. Such consultants would file under full disclosure unless the agency provides in writing a limited disclosure requirement. Agencies may use FPPC Form 805 to assign such disclosure. The obligation to
file Form 700 is always imposed on the individual who is providing services to the agency, not on the business or firm that employs the individual.
FPPC Regulation 18700.3 defines “consultant” as an
individual who makes a governmental decision whether to:
• Approve a rate, rule, or regulation
• Adopt or enforce a law
• Issue, deny, suspend, or revoke any permit, license,
application, certificate, approval, order, or similar
authorization or entitlement
• Authorize the agency to enter into, modify, or renew a contract provided it is the type of contract that requires agency approval
• Grant agency approval to a contract that requires
agency approval and to which the agency is a party, or
to the specifications for such a contract
• Grant agency approval to a plan, design, report, study, or similar item
• Adopt, or grant agency approval of, policies,
standards, or guidelines for the agency or for any of its subdivisions
A consultant also is an individual who serves in a staff capacity with the agency and:
• participates in making a governmental decision; or
• performs the same or substantially all the same duties for the agency that would otherwise be performed by an
individual holding a position specified in the agency’s conflict of interest code.
Designated Employee: An official or employee of a state or local government agency whose position has been
designated in the agency’s conflict of interest code to file statements of economic interests or whose position has
not yet been listed in the code but makes or participates in making governmental decisions. Individuals who contract with government agencies (consultants) may also be
designated in a conflict of interest code.
A federal officer or employee serving in an official federal capacity on a state or local government agency is not a designated employee.
Digital Signature: Under the Act and Commission
regulations, the Form 700s may be filed with a “digital signature,” which may be used to sign documents
electronically, if permitted by the filing officer. A digital signature is a type of certificate-based electronic signature that offers increased security to ensure the identity of the signer and prevent the alteration of documents after signing. For more information on how to use a digital
signature, please refer to the Filing with a Digital Signature Fact Sheet on the FPPC’s website.
For filing officers required to forward original statements filed via digital signature to the FPPC, the filing officer must verify the signature on the statement, and forward the
statement via email to the FPPC at [email protected].
Do not mail the FPPC a copy of a Form 700 with a digital signature affixed.
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Terms & Definitions - (continued)
Disclosure Categories: The section of an agency’s
conflict of interest code that specifies the types of personal economic interests officials and employees of the agency must disclose on their statements of economic interests.
Disclosure categories are usually contained in an appendix or attachment to the conflict of interest code. Contact your agency to obtain a copy of your disclosure categories.
Diversified Mutual Fund: Diversified portfolios of stocks, bonds, or money market instruments that are managed
by investment companies whose business is pooling
the money of many individuals and investing it to seek
a common investment goal. Mutual funds are managed
by trained professionals who buy and sell securities. A typical mutual fund will own between 75 to 100 separate securities at any given time so they also provide instant diversification. Only diversified mutual funds registered with the Securities and Exchange Commission under
the Investment Company Act of 1940 are exempt from
disclosure. In addition, Regulation 18237 provides an
exception from reporting other funds that are similar to diversified mutual funds. (See Reference Pamphlet, page
13.)
Elected State Officer: Elected state officers include
the Governor, Lieutenant Governor, Attorney General,
Insurance Commissioner, State Controller, Secretary
of State, State Treasurer, Superintendent of Public
Instruction, members of the State Legislature, members of the State Board of Equalization, elected members of the Board of Administration of the California Public Employees’ Retirement System and members elected to the Teachers’
Retirement Board.
Enforcement: The FPPC investigates suspected violations of the Act. Other law enforcement agencies (the Attorney General or district attorney) also may initiate investigations under certain circumstances. If violations are found,
the Commission may initiate administrative enforcement
proceedings that could result in fines of up to $5,000 per violation.
Instead of administrative prosecution, a civil action may be brought for negligent or intentional violations by the appropriate civil prosecutor (the Commission, Attorney
General, or district attorney), or a private party residing within the jurisdiction. In civil actions, the measure
of damages is up to the amount or value not properly
reported.
Persons who violate the conflict of interest disclosure provisions of the Act also may be subject to agency
discipline, including dismissal.
Finally, a knowing or willful violation of any provision of the Act is a misdemeanor. Persons convicted of a
misdemeanor may be disqualified for four years from the date of the conviction from serving as a lobbyist or running for elective office, in addition to other penalties that may be imposed. The Act also provides for numerous civil
penalties, including monetary penalties and damages, and injunctive relief from the courts.
Expanded Statement: In some circumstances, an official
or an employee who holds multiple positions subject to
filing obligations (for example, a city council member who also holds a designated position with a county agency,
board, or commission) may complete one expanded
statement for all those positions. The expanded statement must disclose all reportable interests for all jurisdictions and list all positions for which it is filed. The rules and processes governing the filing of an expanded statement are set forth in Regulation 18723.1.
Fair Market Value: When reporting the value of an
investment, interest in real property, or gift, you must disclose the fair market value – the price at which the item would sell for on the open market. This is particularly important when valuing gifts, because the fair market value of a gift may be different from the amount it cost the donor to provide the gift. For example, the wholesale cost of a bouquet of flowers may be $10, but the fair market value may be $25 or more. In addition, there are special rules for valuing free tickets and passes. Call or email the FPPC for assistance.
Gift and Honoraria Prohibitions
Gifts:
State and local officials who are listed in Gov. Code
Section 87200 (except judges – see below), candidates
for these elective offices (including judicial candidates), and officials and employees of state and local government agencies who are designated in a conflict of interest code were prohibited from accepting a gift or gifts totaling more than $590 in a calendar year from a single source in
2023-2024.
In addition, elected state officers, candidates for elective state offices, and officials and employees of state agencies are subject to a $10 per calendar month limit on gifts from lobbyists and lobbying firms registered with the Secretary of State.
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Terms & Definitions - (continued)
Honoraria:
State and local officials who are listed in Gov. Code
Section 87200 (except judges – see below), candidates
for these elective offices (including judicial candidates), and employees of state and local government agencies
who are designated in a conflict of interest code are
prohibited from accepting honoraria for any speech given, article published, or attendance at any public or private conference, convention, meeting, social event, meal, or like gathering.
Exceptions:
• Some gifts are not reportable or subject to the gift
and honoraria prohibitions, and other gifts may not
be subject to the prohibitions, but are reportable. For detailed information, see the FPPC fact sheet entitled
“Limitations and Restrictions on Gifts, Honoraria,
Travel, and Loans,” which can be obtained from your
filing officer or the FPPC website (www.fppc.ca.gov).
• The gift limit and the honorarium prohibitions do not apply to a part-time member of the governing board
of a public institution of higher education, unless the member is also an elected official.
• If you are designated in a state or local government
agency’s conflict of interest code, the gift limit and
honorarium prohibition are applicable only to sources
you would otherwise be required to report on your
statement of economic interests. However, this
exception is not applicable if you also hold a position listed in Gov. Code Section 87200 (See Reference
Pamphlet, page 3.)
• For state agency officials and employees, the $10
lobbyist/lobbying firm gift limit is applicable only to lobbyists and lobbying firms registered to lobby your
agency. This exception is not applicable if you are an
elected state officer or a member or employee of the
State Legislature.
• Payments for articles published as part of the practice of a bona fide business, trade, or profession, such as
teaching, are not considered honoraria. A payment for
an “article published” that is customarily provided in
connection with teaching includes text book royalties
and payments for academic tenure review letters. An
official is presumed to be engaged in the bona fide
profession of teaching if they are employed to teach at an accredited university.
Judges:
Section 170.9 of the Code of Civil Procedure imposes gift limits on judges and prohibits judges from accepting any honorarium. Section 170.9 is enforced by the Commission on Judicial Performance. The FPPC has no authority to
interpret or enforce the Code of Civil Procedure. Court commissioners are subject to the gift limit under the
Political Reform Act.
Income Reporting: Reporting income under the Act is
different than reporting income for tax purposes. The
Act requires gross income (the amount received before
deducting losses, expenses, or taxes, as well as income reinvested in a business entity) to be reported.
Pro Rata Share: The instructions for reporting income
refer to your pro rata share of the income received. Your pro rata share is normally based on your ownership
interest in the entity or property. For example, if you are a sole proprietor, you must disclose 100% of the gross
income to the business entity on Schedule A-2. If you own 25% of a piece of rental property, you must report 25% of the gross rental income received. When reporting your
community property interest in your spouse’s or registered domestic partner’s income, your pro rata share is 50%
of their income. You must also report the name of your spouse’s or registered domestic partner’s employer as the source of income, not the name of spouse or registered
domestic partner.
Separate Property Agreement: Generally, a public official is required to disclose their community property share of their spouse’s income. But, when a public official and their spouse have a legally separate property agreement (e.g., prenuptial agreement), the official is not required to report the spouse’s community property share of income, unless the funds are commingled with community funds or used to pay for community expenses or to produce or enhance the separate income of the official.
Note: This reporting exception does not apply to
investments and interests in real property. Even if a
public official and their spouse have a separate property agreement, the spouse’s investments and interests in real property must still be disclosed because the definitions of reportable investments and interests in real property include those held by the official’s immediate family
(spouse, registered domestic partner, and dependent
children). These definitions are not dependent on
community property law.
Income to a Business Entity: When you are required to
report sources of income to a business entity, sources
of rental income, or sources of commission income, you
are only required to disclose individual sources of income of $10,000 or more. However, you may be required to
disqualify yourself from decisions affecting sources of $500 or more in income, even though you are not required to report them.
Examples:
• Alice Ruiz is a partner in a business entity. Alice has a 25% interest. On Schedule A-2, Alice must disclose
25% of the fair market value of the business entity;
25% of the gross income to the business entity (even
though all of the income received was reinvested in
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Terms & Definitions - (continued)
the business and Alice did not personally receive any
income from the business); and the name of each
source of $40,000 or more to the business.
• Pat and Mark Johnson, a married couple, own Classic
Autos. Income to this business was $200,000. In
determining the amount to report for income on
Schedule A-2, Part 2, Mark must include Mark’s 50%
share ($100,000) and 50% of Mark’s spouse’s share
($50,000). Thus, Mark’s reportable income would
be $150,000 and Mark will check the box indicating
$100,001-$1,000,000. (See Reference Pamphlet, page
13, for an example of how to calculate the value of this investment and interest in real property.)
• Renee Smith is an employee of a private company.
Renee’s employer offers the option of receiving a
stipend in lieu of healthcare insurance provided by the employer. Since Renee Smith receives payments from
their employer instead of healthcare insurance, Renee
is required to report the gross income from the stipend payments. Renee would aggregate and report the total
gross income received from both their stipend and
salary on Schedule C.
You are not required to report:
• Salary, reimbursement for expenses or per diem, social security, disability, or other similar benefit payments received by you or your spouse or registered domestic
partner from a federal, state, or local government
agency
• A travel payment that was received from a nonprofit
entity exempt from taxation under Internal Revenue
Code Section 501(c)(3) for which you provided equal or
greater consideration, such as reimbursement for travel on business for a 501(c)(3) organization for which you
are a board member.
• Campaign contributions
• A cash bequest or cash inheritance
• Returns on a security registered with the Securities and Exchange Commission, including dividends, interest,
or proceeds from a sale of stocks or bonds unless the
purchaser can be identified.
• Redemption of a mutual fund
• Payments received under an insurance policy, such as
life insurance policy payments, including an annuity
• Interest, dividends, or premiums on a time or demand
deposit in a financial institution, shares in a credit union, an insurance policy, or a bond or other debt instrument issued by a government agency
• Your spouse’s or registered domestic partner’s income that is legally “separate” income so long as the funds
are not commingled with community funds or used to
pay community expenses
• Income of dependent children
• Automobile trade-in allowances from dealers
• Loans and loan repayments received from your
spouse or registered domestic partner, child, parent,
grandparent, grandchild, brother, sister, parent-inlaw, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, or first cousin unless they were acting as an
intermediary or agent for any person not covered by
this provision
• Alimony or child support payments
• Payments received under a defined benefit pension
plan qualified under Internal Revenue Code Section
401(a)
• Any loan from a commercial lending institution made
in the lender’s regular course of business on terms
available to the public without regard to your official status
• Any retail installment or credit card debts incurred in the creditor’s regular course of business on terms available to the public without regard to your official status
• Loans made to others. However, repayments may be
reportable on Schedule C
• A loan you co-signed for another person unless you
made payments on the loan during the reporting period
Incentive Compensation: “Incentive compensation”
means income over and above salary that is either
ongoing or cumulative, or both, as sales or purchases of goods or services accumulate. Incentive compensation is calculated by a predetermined formula set by the official’s employer which correlates to the conduct of the purchaser in direct response to the effort of the official.
Incentive compensation does not include:
• Salary
• Commission income (For information regarding
disclosure of “commission income,” see Reference
Pamphlet, page 8.)
• Bonuses for activity not related to sales or marketing, the amount of which is based solely on merit or hours
worked over and above a predetermined minimum
• Executive incentive plans based on company
performance, provided that the formula for determining
the amount of the executive’s incentive income does
not include a correlation between that amount and
increased profits derived from increased business with
specific and identifiable clients or customers of the
company
• Payments for personal services which are not
marketing or sales
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Terms & Definitions - (continued)
The purchaser is a source of income to the official if all three of the following apply:
• the official’s employment responsibilities include
directing sales or marketing activity toward the
purchaser; and
• there is direct personal contact between the official and the purchaser intended by the official to generate sales or business; and
• there is a direct relationship between the purchasing activity of the purchaser and the amount of the incentive compensation received by the official.
Report incentive compensation as follows:
• In addition to salary, reimbursement of expenses, and other income received from your employer, separately
report on Schedule C the name of each person
who purchased products or services sold, marketed
or represented by you if you received incentive
compensation of $500 or more attributable to the
purchaser during the period covered by the statement.
• If incentive compensation is paid by your employer in a lump sum, without allocation of amounts to specific
customers, you must determine the amount of incentive
compensation attributable to each of your customers.
This may be based on the volume of sales to those
customers.
(See Regulations 18700.1 and 18728.5 for more
information.)
Investment Funds: The term “investment” no longer
includes certain exchange traded funds, closed-end funds, or funds held in an Internal Revenue Code qualified plan.
These non-reportable investment funds (1) must be bona
fide investment funds that pool money from more than 100 investors, (2) must hold securities of more than 15 issuers, and (3) cannot have a stated policy of concentrating
their holdings in the same industry or business (“sector funds”). In addition, the filer may not influence or control the decision to purchase or sell the specific fund on behalf of their agency during the reporting period or influence or control the selection of any specific investment purchased or sold by the fund. (See Regulation 18237.)
Investments and Interests in Real Property: When
disclosing investments on Schedules A-1 or A-2 and
interests in real property on Schedules A-2 or B, you must include investments and interests in real property held by your spouse or registered domestic partner, and those held by your dependent children, as if you held them directly.
Examples:
• Julia Pearson, spouse, and two dependent children
each own $600 in stock in General Motors. Because
the total value of their holdings is $2,400, Julia must disclose the stock as an investment on Schedule A-1.
• Pat and Mark Johnson, a married couple, jointly own
Classic Autos. Mark must disclose Classic Autos as
an investment on Schedule A-2. To determine the
reportable value of the investment, Mark will aggregate the value of each of their 50% interest. Thus, if the
total value of the business entity is $150,000, Mark
will check the box $100,001 - $1,000,000 in Part 1 of
Schedule A-2. (Also see Reference Pamphlet, page
12, for an example of how to calculate reportable
income.)
The Johnsons also own the property where Classic
Autos is located. To determine the reportable value of
the real property, Mark will again aggregate the value of each of their 50% interest to determine the amount to
report in Part 4 of Schedule A-2.
• Katie Lee rents out a room in their home. Katie
receives $6,000 a year in rental income. Katie will
report the fair market value of the rental portion of the residence and the income received on Schedule B.
Jurisdiction: Report disclosable investments and sources of income (including loans, gifts, and travel payments) that are either located in or doing business in your agency’s jurisdiction, are planning to do business in your agency’s jurisdiction, or have done business during the previous two years in your agency’s jurisdiction, and interests in real property located in your agency’s jurisdiction.
A business entity is doing business in your agency’s
jurisdiction if the entity has business contacts on a regular or substantial basis with a person who maintains a physical presence in your jurisdiction.
Business contacts include, but are not limited to,
manufacturing, distributing, selling, purchasing, or
providing services or goods. Business contacts do not
include marketing via the Internet, telephone, television, radio, or printed media.
The same criteria are used to determine whether an
individual, organization, or other entity is doing business in your jurisdiction.
Exception:
Gifts are reportable regardless of the location of the donor.
For example, a state agency official with full disclosure must report gifts from sources located outside of California. (Designated employees/code filers should consult their
disclosure categories to determine if the donor of a gift is of the type that must be disclosed.)
When reporting interests in real property, if your jurisdiction is the state, you must disclose real property located within the state of California unless your agency’s conflict of interest code specifies otherwise.
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Terms & Definitions - (continued)
For local agencies, an interest in real property is located in your jurisdiction if any part of the property is located in, or within two miles of, the region, city, county, district, or other geographical area in which the agency has jurisdiction, or if the property is located within two miles of any land owned or used by the agency.
See the following explanations to determine what your
jurisdiction is:
State Offices and All Courts: Your jurisdiction is the state if you are an elected state officer, a state legislator, or a candidate for one of these offices. Judges, judicial candidates, and court commissioners also have statewide jurisdiction. (In re Baty (1979) 5 FPPC Ops. 10) If you are an official or employee of, or a consultant to, a state board, commission, or agency, or of any court or the State Legislature, your jurisdiction is the state.
County Offices: Your jurisdiction is the county if you are an elected county officer, a candidate for county office, or if you are an official or employee of, or a consultant to, a county agency or any agency with jurisdiction solely within a single county.
City Offices: Your jurisdiction is the city if you are an elected city officer, a candidate for city office, or you are an official or employee of, or a consultant to, a city agency or any agency with jurisdiction solely within a single city.
Multi-County Offices: If you are an elected officer,
candidate, official or employee of, or a consultant to
a multi-county agency, your jurisdiction is the region, district, or other geographical area in which the agency has jurisdiction. (Example: A water district has jurisdiction in a portion of two counties. Members of the board are
only required to report interests located or doing business in that portion of each county in which the agency has
jurisdiction.)
Other (for example, school districts, special districts and JPAs): If you are an elected officer, candidate, official or employee of, or a consultant to an agency not covered
above, your jurisdiction is the region, district, or other geographical area in which the agency has jurisdiction.
See the multi-county example above.
Leasehold Interest: The term “interest in real property” includes leasehold interests. An interest in a lease on real property is reportable if the value of the leasehold interest is $2,000 or more. The value of the interest is the total amount of rent owed by you during the reporting period or, for a candidate or assuming office statement, during the prior 12 months.
You are not required to disclose a leasehold interest with a value of less than $2,000 or a month-to-month tenancy.
Loan Reporting: Filers are not required to report loans from commercial lending institutions or any indebtedness created as part of retail installment or credit card
transactions that are made in the lender’s regular course of business, without regard to official status, on terms available to members of the public.
Loan Restrictions: State and local elected and appointed public officials are prohibited from receiving any personal loan totaling more than $250 from an official, employee, or consultant of their government agencies or any government agency over which the official or the official’s agency has direction or control. In addition, loans of more than $250 from any person who has a contract with the official’s agency or an agency under the official’s control are prohibited unless the loan is from a commercial lending institution or part of a retail installment or credit card transaction made in the regular course of business on terms available to members of the public.
State and local elected officials are also prohibited from receiving any personal loan of $500 or more unless the
loan agreement is in writing and clearly states the terms of the loan, including the parties to the loan agreement, the date, amount, and term of the loan, the date or dates when payments are due, the amount of the payments, and the
interest rate on the loan.
Campaign loans and loans from family members are not
subject to the $250 and $500 loan prohibitions.
A personal loan made to a public official that is not being repaid or is being repaid below certain amounts will
become a gift to the official under certain circumstances.
Contact the FPPC for further information, or see the FPPC fact sheet entitled “Limitations and Restrictions on Gifts, Honoraria, Travel, and Loans,” which can be obtained from your filing officer or the FPPC website (www.fppc.ca.gov).
Original Statement: A statement containing either
a handwritten “wet” signature or a “secure electronic
signature” signed under the penalty of perjury and verified by the filer pursuant to Gov. Code Section 81004. A “secure electronic signature” means either (1) a signature submitted using an approved electronic filing system or (2) if permitted by the filing officer, a digital signature submitted via the filer’s agency email address. (See Regulations 18104 and 18757.)
Privileged Information: FPPC Regulation 18740 sets
out specific procedures that must be followed in order
to withhold the name of a source of income. Under this
regulation, you are not required to disclose on Schedule A-2, Part 3, the name of a person who paid fees or made payments to a business entity if disclosure of the name would violate a legally recognized privilege under California 204
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Terms & Definitions - (continued)
or Federal law. However, you must provide an explanation for nondisclosure, separately stating for each undisclosed person: the legal basis for the assertion of the privilege, facts demonstrating why the privilege is applicable, and that to the best of your knowledge you have not and
will not make, participate in making, or use your official position to influence a governmental decision affecting the undisclosed person in violation of Government Code
Section 87100. This explanation may be included with, or attached to, the public official’s Form 700.
We note that the name of a source of income is privileged only to a limited extent under California law. For example, a name is protected by attorney-client privilege only
when facts concerning an attorney’s representation of
an anonymous client are not publicly known and those
facts, when coupled with disclosure of the client’s identity, might expose the client to an official investigation or to civil or criminal liability. A patient’s name is protected by physician-patient privilege only when disclosure of
the patient’s name would also reveal the nature of the
treatment received by the patient. A patient’s name is
also protected if the disclosure of the patient’s name
would constitute a violation by an entity covered under the Federal Health Insurance Portability and Accountability Act (also known as HIPAA).
Public Officials Who Manage Public Investments:
Individuals who invest public funds in revenue-producing programs must file Form 700. This includes individuals who direct or approve investment transactions, formulate or approve investment policies, and establish guidelines for asset allocations. FPPC Regulation 18700.3 defines “public officials who manage public investments” to include the following:
• Members of boards and commissions, including
pension and retirement boards or commissions, and
committees thereof, who exercise responsibility for the management of public investments;
• High-level officers and employees of public agencies
who exercise primary responsibility for the management
of public investments (for example, chief or principal
investment officers or chief financial managers); and
• Individuals who, pursuant to a contract with a state
or local government agency, perform the same or
substantially all the same functions described above.
Registered Domestic Partners: Filers must report
investments and interests in real property held by, and sources of income to, registered domestic partners. (See Regulation 18229.)
Retirement Accounts (for example, deferred
compensation and individual retirement accounts
(IRAs)): Assets held in retirement accounts must be
disclosed if the assets are reportable items, such as
common stock (investments) or real estate (interests
in real property). For help in determining whether your investments and real property are reportable, see the
instructions to Schedules A-1, A-2, and B.
If your retirement account holds reportable assets, disclose only the assets held in the account, not the account
itself. You may have to contact your account manager to determine the assets contained in your account.
Schedule A-1: Report any business entity in which the
value of your investment interest was $2,000 or more
during the reporting period. (Use Schedule A-2 if you have a 10% or greater ownership interest in the business entity.) Schedule B: Report any piece of real property in which
the value of your interest was $2,000 or more during the reporting period.
Examples:
• Anaya Tiwari deposits $500 per month into the
employer’s deferred compensation program. Anaya
has chosen to purchase shares in two diversified
mutual funds registered with the Securities and
Exchange Commission. Because Anaya’s funds are
invested solely in non-reportable mutual funds (see
Schedule A-1 instructions), Anaya has no disclosure
requirements with regard to the deferred compensation
program.
• Earl James Jones has $6,000 in an individual
retirement account with an investment firm. The
account contains stock in several companies doing
business in his jurisdiction. One of the stock holdings, Misac Computers, reached a value of $2,500 during the
reporting period. The value of the investment in each of the other companies was less than $2,000. Earl must
report Misac Computers as an investment on Schedule
A-1 because the value of the stock in that company was
$2,000 or more.
• Adriane Fisher has $5,000 in a retirement fund that
invests in real property located in Adriane’s jurisdiction.
The value of Adriane’s interest in each piece of
real property held in the fund was less than $2,000
during the reporting period. Although this retirement
fund holds reportable assets, there is no disclosure
requirement because it did not have a $2,000 or
greater interest in any single piece of real property. If, in the future, the value of Adriane’s interest in a single piece of real property reaches or exceeds $2,000, it
will be required to be disclosed on Schedule B for that reporting period.
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Terms & Definitions - (continued)
Trusts: Investments and interests in real property held and income received by a trust (including a living trust) are reported on Schedule A-2 if you, your spouse or registered domestic partner, and your dependent children together
had a 10% or greater interest in the trust and your pro rata share of a single investment or interest in real property was $2,000 or more.
You have an interest in a trust if you are a trustor and:
• Can revoke or terminate the trust;
• Have retained or reserved any rights to the income or principal of the trust or retained any reversionary or
remainder interest; or
• Have retained any power of appointment, including the power to change the trustee or the beneficiaries.
Or you are a beneficiary and:
• Presently receive income (see Gov. Code Section
82030); or
• Have an irrevocable future right to receive income
or principal. (See FPPC Regulation 18234 for more
information.)
Examples:
• Sarah Murphy has set up a living trust that holds
Sarah’s principal residence, stock in several companies that do business in the jurisdiction, and a rental home in the agency’s jurisdiction. Since Sarah is the trustor and can revoke or terminate the trust, Sarah must disclose
any stock worth $2,000 or more and the rental home
on Schedule A-2. Sarah’s residence is not reportable
because it is used exclusively as a personal residence. • Chao Yee is listed as a beneficiary in a family’s trust.
However, Chao does not presently receive income
from the trust, nor an irrevocable future right to receive income or principal. Therefore, Chao is not required to disclose any assets contained in the family trust.
Blind Trusts:
A blind trust is a trust managed by a disinterested trustee who has complete discretion to purchase and sell assets held by the trust. If you have a direct, indirect, or beneficial interest in a blind trust, you may not be required to disclose your pro rata share of the trust’s assets or income.
However, the trust must meet the standards set out in
FPPC Regulation 18235, and you must disclose reportable assets originally transferred into the blind trust and income from those original assets on Schedule A-2 until they have been disposed of by the trustee.
Trustees:
If you are only a trustee, you do not have a reportable interest in the trust. However, you may be required
to report the income you received from the trust for
performing trustee services.
Wedding Gifts: Wedding gifts must be disclosed if they
were received from a reportable source during the period covered by the statement. Gifts valued at $50 or more are reportable; however, a wedding gift is considered a gift to both spouses equally. Therefore, you would count one-half of the value of a wedding gift to determine if it is reportable and need only report individual gifts with a total value of $100 or more.
For example, you receive a place setting of china valued at $150 from a reportable source as a wedding gift. Because the value to you is $50 or more, you must report the gift on Schedule D, but may state its value as $75.
Wedding gifts are not subject to the $590 gift limit ($590 in 2023-2024), but they are subject to the $10 lobbyist/
lobbying firm gift limit for state officials.
Privacy Information Notice
Information requested on all FPPC forms is used by the
FPPC to administer and enforce the Political Reform Act (Gov. Code Sections 81000-91014 and California Code of
Regulations Sections 18110-18997). All information
required by these forms is mandated by the Political
Reform Act. Failure to provide all of the information
required by the Act is a violation subject to administrative, criminal, or civil prosecution. All reports and statements provided are public records open for public inspection and reproduction.
If you have any questions regarding this Privacy Notice or how to access your personal information, please contact the FPPC at:
General Counsel
Fair Political Practices Commission
1102 Q Street, Suite 3050
Sacramento, CA 95811
(916) 322-5660
(866) 275-3772
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APPENDIX B - ETHICS (AB 1234)
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AB 1234 Self-Study Materials
Part I: Financial Interests and Perks
AB 1234 requires elected and appointed officials to take two hours of ethics training if they receive compensation for their service or are reimbursed for their expenses.1 The ethics training requirement may also apply to agency employees designated by the agency’s legislative body.2 There are many ways to satisfy this requirement, including in-person training and self-study activities.
Moreover, like all ethics laws, AB 1234 is a floor, not a ceiling. Local officials can demonstrate their commitment to ethics in public service by going beyond AB 1234’s minimum requirements.
This self-study exercise is eligible for one hour of AB 1234 self-study credit (or half of the minimum requirement). To claim self-study credit, log on to www.ca-ilg.org/AB1234selfstudy, print out and take the test, mail it to the address indicated with the $37.50 processing fee. This fee covers grading the test, providing the correct answers (and explanations) and your proof of participation certificate.
Scope of This Self-Study Exercise
These materials cover the first two areas of ethics training required by AB 1234:
▪ Laws relating to personal financial gain by public officials (including bribery and conflict of interest laws); and
▪ Laws relating to office-holder perks, including gifts and travel restrictions, personal and political use of public resources and prohibitions against gifts of public funds. 3 It also covers ethics principles related to these laws and ethics in public service in general.
Self-study materials that cover governmental transparency and fair process laws may be found here: www.cailg.org/post/ab-1234-self-study.
Note that public service ethics laws are extraordinarily complex. The learning objective of both self-study and in-person AB 1234 training courses is to familiarize local officials with when they need to consult agency counsel, the Attorney General or the Fair Political Practices Commission about a given situation or course of action.
Moreover, the ethics laws and training requirements of AB 1234 are both minimum standards. Just because a course of action is legal doesn’t mean that it is ethical or that the public or media will perceive it to be so. Local officials are strongly encouraged to go beyond the minimum standards set forth in the law and participate in additional educational activities relating to their legal and ethical obligations as public servants.
Financial Gain
Key Concepts
The principle underlying the financial gain laws is that the possibility of personal financial gain or loss cannot be a factor in your decisions as a public official. The laws in this area are designed to promote the general 208
AB 1234 TEST 1 SELF-STUDY MATERIALS
ethical values of responsibility and trustworthiness. Public servants have a responsibility to act always in the public’s interest, and the public needs to be able to trust that they will.
Key Laws
The following laws are designed to avoid both the reality and the appearance of personal financial gain influencing public servants’ actions.
▪ Bribery. Requesting, receiving or agreeing to receive money in exchange for an official action is a crime.
Under the state’s criminal laws, a “bribe” includes anything of value; it also includes receiving “advantages.” 4The advantage can be a future one and need not involve the payment of money.5 ▪ Disqualification Based on Financial Interests. A public official may not make, participate in or influence a governmental decision that will have a foreseeable and material financial effect on the official, the official’s immediate family or any of the official’s economic interests.6 Note the breadth of the prohibition: it does not just apply to voting, but the entire process leading up to voting. ▪ Interests in Contracts Prohibited. A public official may not have a financial interest in any contract made by the board or body of which the official is a member.7 The law is very strict on this point. Such contracts are void—meaning that the public agency will not have to pay the official for the benefits provided to the agency under the contract.8 Under most circumstances, the prohibition cannot be avoided by disqualifying oneself from participating in the decision on the contract. ▪ Helping Prospective Employers. A public official may not influence agency decisions when the interests of a prospective employer are at stake.
9 This situation arises when someone is negotiating or has “any arrangement” concerning prospective employment with someone with business before the agency. ▪ Revolving Door. Elected officials and top-level managers cannot represent individuals or entities before their agencies for one-year after leaving office.
10 Note that some local agencies have adopted even more restrictive prohibitions. 209
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The “Leave the Room” Requirement
If you are disqualified from participating on a specific agenda item under the conflict of interest rules established by the Political Reform Act, you must:11
▪ At the meeting, publicly identify the financial interest or potential conflict of interest in sufficient detail to be understood by the public.
▪ Not attempt to influence the decision in any way (this includes pre-meeting discussions with staff or colleagues).
▪ Refrain from discussing or voting on the matter (you should ask the item to be considered separately if it is on the consent calendar).
▪ Leave the room until after the discussion, vote and any other disposition of the matter, unless the matter is on the consent calendar.
There are limited exceptions that allow a disqualified official to remain in the room and participate in the discussion as a member of the public when one’s “personal interests” are at stake. Consult with your agency attorney about what kinds of personal interests qualify.
Consequences of Missteps
The consequences of violating these requirements can be severe. They include criminal felony or misdemeanor prosecutions. Conviction can involve substantial fines, jail time and loss of office. Civil fines can also add up. For example, the administrative penalty for violation of the Political Reform Act is a fine of up to $5,000 per violation. In most instances, officials targeted for civil enforcement actions will pay tens of thousands of dollars in defense costs, significantly more in criminal cases.
There can also be other kinds of negative consequences. For example, if an official violates proscriptions against self-dealing relating to contracts, the official may have to refund amounts paid under the contract. If a decision is tainted by the participation of someone who should have disqualified him or herself, the decision is subject to invalidation.
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Financial Interests Affected by an Agency Decision:
When to Seek an Attorney’s Advice
Talk with your agency attorney when 1) an action by your public agency 2) may affect (positively or negatively 3) any of the following:
Income. Any source of income of $500 or more (including promised income) during the prior 12 months for you or spouse/domestic partner.
Real Property. A direct or indirect interest in real property of $2,000 or more that you or your immediate family (spouse/domestic partner and dependent children) have, including such interests as ownership, leaseholds (but not month-to-month tenancies) and options to purchase, especially when any of these are located within 500 feet of the subject of your decision.
Personal Finances. Your or your immediate family’s (spouse/domestic partner and dependent children) personal expenses, income, assets, or liabilities.
Gift Giver. A giver of a gift of $520 (for 2021-22) or more to you in the prior 12 months, including promised gifts.
Lender/Guarantor. A source of a loan (including a loan guarantor) to you.
Contract. You or a member of your family would have an interest (direct or indirect) in a contract with the agency.
Business Management or Employment. An entity for which you serve as a director, officer, partner, trustee, employee, or manager.
Business Investment. An interest in a business in which you or your immediate family (spouse/ domestic partner and dependent children) have a direct or indirect investment worth $2,000 or more.
Related Business Entity. An interest a business that is the parent, subsidiary or is otherwise related to a business if you:
▪ Have a direct or indirect investment worth $2,000 or more; or ▪ Are a director, officer, partner, trustee, employee, or manager.
Business Entity Owning Property. A direct or indirect ownership interest in a business entity or trust of yours that owns real property.
Campaign Contributor. A campaign contributor of yours (if you are sitting on an appointed decisionmaking body).
Other Personal Interests and Biases. You have important, but non-financial, personal interests or biases (positive or negative) about the facts or the parties that could prevent you from making a fair decision.
What Will Happen Next? Agency counsel will advise you whether 1) you can participate in the decision and, 2) if a contract is involved, whether the agency can enter into the contract at all. Counsel may suggest asking either the Fair Political Practices Commission or the State Attorney General to weigh in. Keep in mind the attorney’s duty is to promote compliance with the ethics laws, not try to find ways around them.
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Personal Advantages and Perks
Key Concepts
The principle underlying the “no perks” laws is that one’s status as a public servant and one’s access to public resources should not afford special privileges. There are two categories of “no perk” laws. One relates to perks that others provide public officials (for example, gifts). The other involves advantages that officeholders provide themselves (for example, use of public resources).
The laws in this area are designed to promote the general ethical values of fairness, responsibility and trustworthiness. For example, receipt of perks from others undermines the public’s trust that decision-makers are treating everyone who comes before them fairly and making decisions solely in the public’s interests.
When officeholders give themselves perks, the public’s trust that these officeholders are being careful and public-minded stewards of taxpayer resources is undermined. To the extent that some of these perks involve political advantages, they undermine the fairness of campaigns and elections.
Key Laws
Generally speaking, the “no perks” laws bar some transactions and require disclosure of others. The laws are complex and the following will help you “spot” the issue so you can consult agency counsel for further information about the rules in a given instance.
▪ Loans. Officials cannot receive loans from those within the agency12 or with whom the agency contracts (except for bank or credit card indebtedness made in the regular course of the company’s business).13 Personal loans over $500 from others must meet certain requirements (for example, be in writing, clearly state the date, amounts and interest payable).14
▪ Gifts. With certain exceptions, a public official must disclose most gifts of $50 or more on his or her Statement of Economic Interests and may not receive gifts from any one source that totals over $520 in a single year (for 2021-22).15 Gifts include meals, certain kinds of travel payments, and rebates or discounts to public officials not offered to others in the usual course of business.16 ▪ Travel Expenses from Non-Transportation Companies. Gifts of travel expenses (for example, airfare, lodging, meals and entertainment) from non-transportation companies are generally subject to the gift rules and must be reported on one’s Statement of Economic Interests as such. ▪ Travel Passes from Transportation Companies. State law strictly forbids elected and appointed public officials from accepting free or discounted travel from transportation companies.17 The penalty for violating the prohibition against accepting travel passes from transportation companies is severe--an immediate forfeiture of office.18
▪ Receiving Gratuities or Rewards. It is a crime to receive any kind of gratuity or reward for performing one’s duties.19
▪ Honoraria. State law regulates the degree to which public officials may receive payments for giving a speech, writing an article or attending a public or private conference, convention, meeting, social event, meal or similar gathering.20 Generally such payments—which are known as honoraria--are prohibited.
The notion is such communications are part of a public official’s service. 212
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▪ Personal Use of Public Resources. State law forbids public officials from using public resources for personal purposes.21 “Public resources” include such things as 1) staff time, 2) office equipment (telephones, fax machines, photocopiers, and computers), and 3) office supplies (stationery, stamps, and other items). “Personal” use of public resources includes activities that are for personal enjoyment, private gain or advantage.22 For example, asking a staff member to pick up your laundry or kids from daycare would be a violation. “Use” means the use of public resources that is substantial enough to result in a gain or advantage for the user and a loss to the local agency that can be estimated as a monetary value.23
▪ Expense Reimbursement. The general rule is that local agency officials may only be reimbursed for actual and necessary expenses.24 Cities, counties, and special districts that reimburse their elected and appointed officials must adopt expense reimbursement policies that specify the kinds of activities that will be reimbursable.25 Local agencies must use expense report forms and all expenses must be documented with receipts.26 These documents are public records subject to disclosure.27 ▪ Limits on Public Official Compensation. Typically, there is a legal limit on elected public official compensation levels, either in state or local law public officials, particularly elected ones, may only collect and retain such compensation that the law allows.
28 As protectors of the public purse, courts generally
take a strict approach to public official compensation limits.29 City and county officials typically receive a monthly salary for their service. Special district directors tend to be compensated by a daily stipend. With certain exceptions, this stipend compensates such directors for:
▪ A meeting of any “legislative body” as defined by the Brown Act ▪ A meeting of an advisory body
▪ Conference attendance or educational activities, including ethics training30 Agencies may compensate officials for attendance at other events as specified in a written policy adopted in a public meeting.31
▪ Use of Public Resources for Political Purposes. The same statutes that prohibit the use of public resources for personal benefit also prohibit the use of such resources for campaign purposes.32 The prohibition applies to campaigns to elect candidates and campaigns in support of or opposition to ballot measures.
▪ Mass Mailings at Public Expense. State law forbids sending mass mailings at public expense.33 State law defines “mass mailings” as including mailings that “feature an elected officer” by including their photograph or signature, or by singling out the officer by a manner in which their name appears in the document.34
▪ Gifts of Public Resources or Funds. California’s constitution forbids gifts of public funds. This prohibits, for example, paying for spouses, partners or family members to accompany public officials.35 It can also be an issue when a public agency contemplates charitable contributions.36 213
AB 1234 TEST 1 SELF-STUDY MATERIALS
▪ Soliciting Political Support from Agency Employees. Soliciting campaign funds from agency officers or employees is also unlawful,37 as is conditioning employment decisions on support of a person’s candidacy.38 Compensation decisions may not be tied to political support.39 ▪ Speak with your agency counsel about the specifics of these requirements as they may apply to your situation.
Consequences of Missteps
The consequences of violating the “no-perk” laws can also be severe. For example, the prohibitions against the personal use of public resources are punishable by a $1,000 per day fine plus three times the value of the resource used.40 Criminal penalties include a two to four year prison term and disqualification from office.41 Prosecution under the federal income tax evasion laws is also a possibility.42 Again, this does not include the costs of hiring defense lawyers, which can add up to tens of thousands of dollars, if not more.
Beyond the Minimum in Understanding Public Service Ethics Like all ethics laws, AB 1234 sets minimum standards. The enforcement mechanism for complying with AB 1234’s requirements relies on public scrutiny and media attention.
Records of officials’ compliance with AB 1234 (proof of participation certificates) are public records and must be maintained for at least five years.43 In addition to maintaining records on compliance with the minimum standards imposed by AB 1234, local agencies may also want to maintain records of any training and study local agency officials engaged in above and beyond AB 1234’s minimum requirements. This will enable those inquiring to ascertain the agency’s and individual’s full scope of commitment to understanding the ethical and legal obligations associated with public service.
Beyond the Law
Understanding and complying with public service ethics laws is a challenge. But the public expects even more of its public servants. Rather than making decisions purely on the fly, how can public officials maximize the likelihood that they will meet or exceed the public’s expectations for ethical conduct? To be considered successful as a public servant, one is encouraged to think in terms of ethical values not minimum standards. Some key values relating to public service include responsibility, trustworthiness, respect and fairness. Assess decisions you have to make against these standards.
In addition, you can ask yourself these kinds of questions:
▪ What decision, behavior or course of action will best promote the public’s trust in my leadership and that of my agency?
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▪ Would I want to read about a certain course of action on the front page of my local newspaper? ▪ How do I want to be remembered as a public official? What would make my family and parents proud as a legacy?
For example, even if you are not legally required to disqualify yourself from participating in a decision, you may want to voluntarily abstain from participating if you believe the public could reasonably question whether you could put personal relationships and interests aside in making a given decision.
Conclusion
Former British Prime Minister Benjamin Disraeli once observed “...that all power is a trust; that we are accountable for its exercise.” As extensive and complicated as they are, the above rules relating to public service ethics are a reflection of that overarching quest for accountability and trust.
For more information on these rules, go to www.ca-ilg.org/ethicslaws. For more information on ethics principles, please visit www.ca-ilg.org/ethicsprinciples.
References
1 Cal. Gov’t Code § 53235(a), (b).
2 Cal. Gov’t Code § 53234(c).
3 Cal. Gov’t Code § 53235(a), (b).
4 Cal. Penal Code § 7
5 Id. See also People v. Anderson, 75 Cal. App. 365 (1925). 6 See Cal. Gov’t Code §§ 87100 and following.
7 Cal. Gov’t Code § 1090.
8 Cal. Gov’t Code § 1092. Thomson v. Call, 38 Cal. 3d 633, 646 (1985) 9 Cal. Gov’t Code § 87407.
10 See Cal. Gov't Code §87406.3.
11 See Cal. Gov’t Code § 87105.
12 See Cal. Gov’t Code § 87460(a), (b).
13 See Cal. Gov’t Code § 87460(c), (d).
14 See Cal. Gov’t Code § 87461.
15 Cal. Gov’t Code §§ 87200, 87207, 89503; 2 Cal. Code Regs. § 18940.2 (The gift limit is modified every two years to reflect changes in the Consumer Price Index; the $520 (2021-22)
16 Cal. Gov’t Code § 82028(a).
17 See Cal. Const. art. XII, § 7 (“A transportation company may not grant free passes or discounts to anyone holding an office in this State . . .”). 18 See Cal. Const. art. XII, § 7 (“. . .acceptance of a pass or discount by a public officer . . . shall work a forfeiture of that office . . .”). 19 Cal. Penal Code § 70.
20 See Cal. Gov’t Code § 89501 (definition of honoraria). 21 See Cal. Penal Code § 424; Cal. Gov’t Code § 8314.
22 Cal. Gov’t Code § 8314(b)(1).
23 Cal. Gov’t Code § 8314(b)(4).
Disclaimer: Open meeting practices continue to evolve as the COVID-19 crisis continues and agencies use a wide range of technology to meet their needs. The information provided in this document is for general informational purposes only and is not intended to provide legal advice to any individual or entity. ILG urges you to consult with your own legal advisor before taking any action based on this information.
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24 Cal. Gov’t Code § 36514.5.
25 Cal. Gov’t Code § 53232.2(b).
26 Cal. Gov’t Code § 53232.3.
27 Cal. Gov’t Code § 53232.3(e).
28 For example, the salary of council members of general law cities is controlled by Government Code section 36516(a), which permits a city council to establish by ordinance a salary up to a ceiling determined by the city’s population. The electorate may approve a higher salary. Cal. Gov’t Code § 36516(b). A council member appointed or elected to fill a vacancy is compensated in the same amount as his or her predecessor. A directlyelected mayor may receive additional compensation with the consent of the electorate or by ordinance of the city council. Cal. Gov’t Code § 36516.1. See also Cal. Educ. Code §§ 1090 (county board of education compensation), 35120 (school board member compensation), 72425 (community college board member compensation).
29 Id.
30 Cal. Gov’t Code § 53232.1(a).
31 Cal. Gov’t Code § 53232.1(b).
32 Cal. Penal Code § 424; People v. Battin, 77 Cal. App. 3d 635 (1978) (successful criminal prosecution of county supervisor for misusing public funds for improper political purposes), superseded on other grounds by People v. Conner, 34 Cal. 3d 141 (1983). See also Cal. Gov’t Code § 8314 (“‘Campaign activity’ means an activity constituting a contribution as defined in Section 82015 or an expenditure as defined in Section 82025. ‘Campaign activity’ does not include the incidental and minimal use of public resources, such as equipment or office space, for campaign purposes, including the referral of unsolicited political mail, telephone calls and visitors to private political entities.”). 33 See Cal. Gov’t Code § 89001.
34 See Cal. Gov’t Code 89002
35 75 Cal. Op. Att’y Gen. 20 (1992) (finding paying a spouse’s expenses to a conference violates both Government Code section 1090 and constitutional prohibitions against gifts of public funds). See also 65 Cal. Op. Att’y Gen. 517, 521 (1982) (finding Government Code section 36514.5 does not authorize reimbursement of the expenses of any person other than a member of the city council). See also Albright v. City of South San Francisco, 44 Cal. App. 3d 866, 869-870 (1975). (unauthorized reimbursement is illegal gift). 36 See generally McQuillin, Municipal Corporations, § 39.25 (3d rev. ed. 1988) (“Appropriations to charitable or nonprofit associations, without consideration [something in return], cannot be made.”)
37 See Cal. Gov’t Code § 3205 (except for those communications to a significant segment of the public that happens to include fellow public officials and employees).
38 See Cal. Gov’t Code § 3204, which reads as follows: No one who holds, or who is seeking election or appointment to, any office or employment in a state or local agency shall, directly or indirectly, use, promise, threaten or attempt to use, any office, authority, or influence, whether then possessed or merely anticipated, to confer upon or secure for any individual person, or to aid or obstruct any individual person in securing, or to prevent any individual person from securing, any position, nomination, confirmation, promotion, or change in compensation or position, within the state or local agency, upon consideration or condition that the vote or political influence or action of such person or another shall be given or used in behalf of, or withheld from, any candidate, officer, or party, or upon any other corrupt condition or consideration. This prohibition shall apply to urging or discouraging the individual employee’s action. 39 ??
40 Cal. Gov’t Code § 8314(c)(1).
41 Cal. Penal Code § 424.
42 See 26 U.S.C. §§ 7201, 7203.
43 Cal. Gov’t Code § 53235.2.
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AB 1234 Self-Study Materials
Part II: Governmental Transparency and Fair Processes
AB 1234 requires elected and appointed officials to take two hours of ethics training if they receive compensation for their service or are reimbursed for their expenses.1 The ethics training requirement may also apply to agency employees designated by the agency’s legislative body.2 There are many ways to satisfy this requirement, including in-person training and self-study activities.
Moreover, like all ethics laws, AB 1234 is a floor, not a ceiling. Local officials can demonstrate their commitment to ethics in public service by going beyond AB 1234’s minimum requirements.
As a special service, the Institute for Local Government is offering this article for one hour of AB 1234 selfstudy credit (or half of the minimum requirement). To claim self-study credit, log on to www.cailg.org/AB1234selfstudy, print out and take the test, mail it to the address indicated with the $37.50 processing fee. This fee covers grading the test, providing the correct answers (and explanations) and your proof of participation certificate; it also supports the Institute’s work in the public service ethics area.
Scope of This Self-Study Exercise
This article covers half of the required areas of ethics, including:3 ▪ Governmental transparency laws, including financial disclosure laws and laws protecting the public’s right to participate in meetings and access public records (the Brown Act and Public Records Act); and ▪ Laws relating to fair processes, including common law bias, due process, incompatible offices, competitive bidding requirements for public contracts and disqualification from participation in decisions involving family members.
The self-study materials covering the other half of the areas of ethics training required by AB 1234 may be found here: www.ca-ilg.org/post/ab-1234-self-study.
Note that public service ethics laws are extraordinarily complex. The learning objective of both self-study and in-person AB 1234 training courses is to familiarize local officials with when they need to consult agency counsel, the attorney general or the Fair Political Practices Commission about a given situation or course of action.
Transparency Laws
The principle underlying governmental transparency laws is that the public trusts what it can observe.
Transparency law is intended to promote participatory democracy, moreover, the prospect that actions will be publicly known can be a deterrent against actions that might undermine public trust. Thus, the laws in this area are designed to promote the general ethical values of trustworthiness and responsibility.
There are two basic categories of transparency laws. One relates to activities of the individual official. For example, these laws require specified officials to periodically disclose their personal financial interests (so the public can assess whether those interests played a role in the official’s decisions). They also require officials to disclose campaign and charitable fundraising activities. 217
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The other kind of transparency laws requires governmental processes to be transparent to the public. These laws require that governmental decisions be made in public and that the public have the opportunity to weigh in on those decisions. They also require that most public records be open to public inspection.
This self-study exercise discusses both kinds of transparency laws.
Financial Disclosure Laws
There is an adage about one’s life being an open book. Nowhere is this truer than for public officials and their finances. The bottom line is that when you become a public official, the public gets to learn a great deal about your financial life. The voters created these disclosure requirements when they approved the Political Reform Act in 1974.4
The disclosure requirements apply to nearly every local elected official and department head. Members of commissions, boards, committees and other local agency bodies with significant decision-making authority are also subject to disclosure requirements. An agency may require additional staff positions to disclose their economic interests under the agency’s local conflict of interest code. Such employees are known as “designated employees.”
The following kinds of economic interests must be disclosed if they meet certain minimum thresholds:5 ▪ Sources of income;
▪ Interests in real property;
▪ Investments;
▪ Business positions; and
▪ Gifts
This disclosure is made on forms called both “Statements of Economic Interests” and “Form 700s.” Copies of these forms are generally provided by one’s agency. Interactive versions of the forms are available from the Fair Political Practices Commission website: www.fppc.ca.gov.
These forms must be completed 1) upon assuming office 2) on an annual basis while in office and 3) upon leaving office.
Charitable Fundraising
The disclosure laws are not limited to an official’s personal financial interests. There are extensive disclosure requirements relating to an official’s campaign fundraising activities.6 However, a sometimes-overlooked disclosure obligation relates to an official’s charitable fundraising activities. The theory is that the public has a right to know who is contributing to an elected official’s favorite charities and other causes.
The trigger occurs when an elected official gets someone to contribute $5,000 or more to a legislative, governmental or charitable cause during a calendar year, known as a behested payment.7 Within 30 days of reaching the $5,000 threshold, the elected official must file a report with the official’s agency (typically with the filing officer).
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Conducting the Public’s Business in Public
California’s open meeting laws8 provide legal minimums for local governmental transparency in decisionmaking. Decision-making bodies--which include the governing board as well as many committees and advisory bodies--must conduct their business in an open and public meeting to assure the public is fully informed about local decisions.9
The following are some key things to keep in mind:
▪ Meetings. A “meeting” is any situation involving a majority of the governing body in which business is transacted or discussed.
10 In other words, a majority of the governing body cannot talk privately about an issue before the body no matter how the conversation occurs, whether by telephone or e-mail or at a local coffee shop.11
▪ Serial Meetings. One thing to watch for is unintentionally creating a “serial” meeting—a series of communications that result in a majority of governing body members having conferred on an issue. For example, if two members of a five-member governing body consult outside of a public meeting (which is not in and of itself a violation) and then one of those individuals consults with a third member on the same issue, a majority of the body has consulted on the same issue. Note the communication does not need to be in person and can occur through a third party. For example, sending or forwarding e-mail can be sufficient to create a serial meeting, as can a staff member polling governing body members in a way that reveals the members’ positions to one another.12
▪ Permissible Gatherings. Not every gathering of governing body members is a problem. For example, a majority of the governing body may attend the same educational conference or a community meeting not organized by the local agency.13 Nor is attendance at a social or ceremonial event in and of itself a violation.14 The key rule to keep in mind is a majority of the governing body members cannot meet and discuss agency business except at an open and fully noticed public meeting. ▪ Closed Sessions. The open meeting laws include provisions for closed discussions under very limited circumstances.15 Because of the complexity of the open meeting laws, close consultation with an agency’s legal advisor is necessary to ensure that the requirements relating to and the limitations on closed sessions are observed.
The Public’s Right to Participate in Meetings
Another element of open meeting laws is the public’s right to address the governing body. A public official’s role is to both hear and evaluate these concerns. There are a number of basic rules that govern this right. ▪ Posting and Following the Agenda. The open meeting laws require that the public be informed of the time of and location and the issues to be addressed at each meeting.16 ▪ Agenda Descriptions. Each agenda item shall provide a description of the item sufficient enough to inform the community as to whether they should want to participate and/or be heard on the item. ▪ The Public’s Right to be Heard. Generally, every agenda must provide an opportunity for the public to address the governing body on any item of interest to the public within the body’s jurisdiction.17 If the 219
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issue of concern is one pending before the legislative body, the opportunity must be provided before or during the body’s consideration of that issue.18
▪ Reasonable Time Limits May Be Imposed. Local agencies may adopt reasonable regulations to ensure everyone has an opportunity to be heard in an orderly manner.19 The Public’s Right to Access Records
Copies of the agenda materials and other documents distributed to the governing body must also be available to the public.20 The public has the right to see any materials that are created as part of the conduct of the people’s business.21 These materials include any writing that was prepared, owned, used or retained by a public agency.22 They include documents, computer data, e-mails, facsimiles and photographs.23 The public may even have a right to access records such as texts and email messages on private devices and accounts used by a public official.24
Although there are exceptions to a public agency’s duty to disclose records, the safe assumption is virtually all materials involved in one’s service on the governing body--including e-mails--are public records subject to disclosure.
Fair Process Laws
Not surprisingly, fair process laws promote the ethical value of fairness. This is the notion that everyone has a right to be treated fairly by governmental processes, irrespective of who they are or whom they know. The public’s perception that decisions are made fairly is a key element of the public’s confidence and trust in government and individual public officials.
The Obligation to be a Fair and Unbiased Decision-Maker Although California statutes largely determine when public officials must disqualify themselves from participating in decisions, common law (judge-made) and some constitutional principles still require a public official to exercise his or her powers free from personal bias-including biases that have nothing to do with financial gain or losses.
In addition, constitutional due process principles require a decision-maker to be fair and impartial when the decision-making body is sitting in what is known as a “quasi-judicial” capacity. Quasi-judicial matters include variances, use permits, annexation protests, personnel disciplinary actions and licenses. Quasi-judicial proceedings tend to involve the application of generally adopted standards to specific situations, much as a judge applies the law to a particular set of facts.
For example, a court overturned a planning commission’s decision on due process grounds, concluding that a planning commissioner’s authorship of an article hostile to a project before the commission gave rise to an unacceptable probability of bias against the project, and that the commissioner should have disqualified himself from participating in the decision.25
Typically, having the official who may have exhibited bias disqualify himself or herself solves the problem.26 If the problem is not addressed though, the agency’s decision will be at risk of being overturned by the courts.27 The agency will have to conduct new proceedings free of the influence of the biased decision-maker.28 If the 220
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violation rises to the level of a denial of due process under constitutional law, the affected individual(s) may seek damages, costs and attorney fees.29
Finally, community relations—and the public’s views of an official’s responsiveness—are seriously undermined when it appears an official is not listening to the input being provided by the public. Even if you disagree with the views being offered, treat the speaker with the same respect you would like to be treated with if the roles were reversed. Moreover, at least one court has ruled that officials’ perceived inattentiveness during a hearing violated due process principles.30
Campaign Contributions and Bias
Generally, the ethics laws with respect to campaign contributions emphasize disclosure rather than disqualification. The emphasis on disclosure enables the public to assess for itself the degree an official could be influenced by campaign contributors who appear before the agency. Both financial and in-kind support must be disclosed.
However, under limited (and sometimes counterintuitive) circumstances, certain local agency officials must disqualify themselves from participating in proceedings regarding licenses, permits and other entitlements for use if the official has received campaign contributions of more than $250 during the previous twelve months from any party or participant.31 The restrictions apply if the official is sitting on an appointed (as opposed to elected) body.32
In addition, these officials are prohibited from receiving, soliciting or directing a campaign contribution of more than $250 from any party or participant in a license, permit or entitlement proceeding while the proceeding is pending and for three months after the contribution.33
Holding Multiple Public Offices
There is such a thing as too much public service; the law limits the degree to which public officials can hold multiple public offices. The reason is that, when one assumes a public office, one takes on responsibility to the constituents of that agency to put their interests first. When one occupies multiple offices in multiple agencies (for example, membership on the city council and serving on the board of another local agency), that job becomes more complicated, both legally and ethically, because of the possibility of conflicting loyalties.34 Offices are incompatible if there is a potential for any significant clash of duties or loyalties between the offices, or either officer exercises a supervisory, auditory or removal power over the other. The prohibition against the simultaneous holding of incompatible offices does not require the existence of an actual conflict between the offices. A potential for a significant clash between the two offices is sufficient to trigger the prohibition.35 Note there can be specific legislative exceptions to incompatible office rules.
Competitive Bidding Processes for Public Contracts
Public contracting laws—including those adopted at the local level—are designed to give all interested parties the opportunity to do business with the government on an equal basis. This keeps contracts from being steered to businesses or individuals because of political connections, friendship, favoritism, corruption or other factors. 221
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It also assures that the public receives the best value for its money by promoting competition among businesses so the public can receive the best deal.36
Many competitive bidding requirements are locally imposed, for example, by charter cities as part of their municipal affairs authority.37 State law also authorizes local agencies to adopt procedures for acquisition of supplies and equipment.38 Most of these purchasing ordinances require competitive bids for contracts in excess of designated dollar amounts.
For public works projects, state law defines when general law cities and counties must use competitive bidding.
For general law cities, public works projects over $5,000 are subject to the state’s competitive bidding requirements.39 For county projects, the threshold is based on population: $6,500 (counties with populations of 500,000 or over), $50,000 (counties with populations of 2 million or over) and $4,000 (all other counties).40 Note that it is a misdemeanor to split projects to avoid competitive bidding requirements.41 In order to give all interested parties an opportunity to do business with the agency and get the best price for the public, the agency has to publicize the opportunity. This is typically accomplished by publishing a notice inviting bids in a newspaper of general circulation that is printed or published in the jurisdiction, or if there is none, posting the notice in at least three public places in the jurisdiction.42 Trade publications can also be a helpful way to reach a wide segment of the contracting industry.
Decisions Involving Family Members
The Political Reform Act requires public officials to disqualify themselves from participating in decisions that will increase or decrease their immediate family’s expenses, income, assets or liabilities.43 “Immediate family” includes one’s spouse or domestic partner and dependent children.44 The notion is that it is very difficult for any person to be fair and unbiased when one’s family’s interests are concerned; it is, of course, also difficult for the public to perceive the official to be fair and unbiased about close family members.
Because of this, some jurisdictions have adopted additional restrictions on the hiring or appointing of relatives of public officials. These are known as anti-nepotism policies. It can be wise to avoid questions about family relationship by voluntarily not participating in decisions that affect family members, even if the law or local agency regulations allow you to participate.
Beyond the Law
At some point in your service as a public official, you will likely face two common types of ethical dilemmas:
▪ Personal Cost Ethical Dilemmas. This involves situations in which doing the right thing may or will come at a significant personal cost to you or your public agency. These also can be known as “moral courage” ethical dilemmas.45
▪ Right-versus-Right Ethical Dilemmas. This type of ethical dilemma involves those situations in which there are two conflicting sets of “right” values.46
Of course, some dilemmas are a combination of both: a conflict between competing sets of “right” values (rightversus-right) and a situation in which doing the right thing involves personal or political costs. 222
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Personal Cost Ethical Dilemmas
With these kinds of dilemmas, the costs can be political - such as the loss of political support or perhaps even one’s prospects for reelection. Or, the cost can be financial, for example a missed opportunity for financial gain or material benefits. Issues relating to the proper use of public resources fall into the “personal cost” type of ethical dilemma, in as much as these dilemmas typically involve whether one is going to forgo a tempting political or personal benefit. Finally, the cost can be more directly personal, as when one fears a particular course of action may jeopardize a friendship. In these situations, the answer is relatively simple. The bottom line is that being ethical means doing the right thing regardless of personal costs.
Right-versus-Right Ethical Dilemmas
Right-versus-right ethical dilemmas can be more difficult to resolve. An easy example, however, is when a political supporter urges you to do something that conflicts with your own best sense of what will serve your community’s interests. In this dilemma, there is a conflict between your responsibility to do what is in the public’s best interest and your loyalty to your political supporter. Responsibility and loyalty are both bona fide ethical values.
The key is, as a public servant, the ethical value of responsibility (and the responsibility to do what is in the public’s best interest) trumps the ethical value of loyalty. This is when thinking about the public’s perception of the right thing to do can be a useful dilemma-resolution strategy.
Conclusion
In politics, there is a great temptation to engage in ends/means thinking in which one is tempted to conclude that good or desirable ends justify the means. As both Dr. Martin Luther King, Jr. and Gandhi have observed, the means are the end in a democracy and good ends cannot come from questionable means.
Public officials are stewards of the public’s trust in both their institutions and their leaders. Central to that trust is a fair and open process. Conscientious attention to laws and principles of fair and open government will help you as a leader pursue both good means and good ends.
Resources for Further Information
For more information about ethics laws and principles, check out the following resources:
▪ California Attorney General Publications: www.caag.state.ca.us/publications/index.htm (click on ‘‘ethics’’) ▪ Fair Political Practices Commission Publications: http://www.fppc.ca.gov/index.php?id=226 ▪ Institute for Local Government Ethics Resource Center: www.ca-ilg.org/trust Disclaimer: Open meeting practices continue to evolve as the COVID-19 crisis continues and agencies use a wide range of technology to meet their needs. The information provided in this document is for general informational purposes only and is not intended to provide legal advice to any individual or entity. ILG urges you to consult with your own legal advisor before taking any action based on this information.
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References
1 Cal. Gov’t Code § 53235(a), (b).
2 Cal. Gov’t Code § 53234(c).
3 Cal. Gov’t Code § 53234(d)(3), (4).
4 This is a requirement of the Political Reform Act. See generally Cal. Gov’t Code §§ 87200 and following. 5 See Cal. Gov’t Code §§ 87200-87210; 2 Cal. Code Regs. §§ 18723-18740. 6 See generally Cal. Gov’t Code §§ 84100 and following; 2 Cal. Code Regs. §§ 18401 and following. 7 See Cal. Gov’t Code § 82015(b)(2)(B)(iii).
8 See generally Cal. Gov’t Code §§ 54950 and following (for cities, counties, special districts and school districts); Cal. Educ. Code §§ 72121 and following (for community college district governing boards). 9 See Cal. Gov’t Code 54952.2(a); Cal. Gov’t Code § 54954.2(a). 10 Cal. Gov’t Code § 54952.2(a).
11 Cal. Gov’t Code § 54952.2(b); Cal. Educ. Code § 72121. 12 Cal. Gov’t Code § 54952.2.
13 Cal. Gov’t Code § 54952.2(c)(2).
14 Cal. Gov’t Code § 54952.2(c)(5).
15 See Cal. Gov’t Code § 54954.5; Cal. Educ. Code § 71122. 16 Cal. Gov’t Code § 54954.2(a): Cal. Educ. Code § 72121. 17 Cal. Gov’t Code § 54954.3(a); Cal. Educ. Code § 72121.5. 18 Cal. Gov’t Code § 54954.3(a).
19 Cal. Gov’t Code § 54954.3(b); White v. City of Norwalk, 900 F.2d 1421, 1425 (9th Cir. 1990). 20 Cal. Gov’t Code § 54957.5.
21 See generally Cal. Gov’t Code §§ 6250 and following. 22 Cal. Gov’t Code § 6252(d).
23 Cal. Gov’t Code § 6252(e).
24 City of San Jose vs. Superior Court of the County of Santa Clara, 2 Cal. 5th 608 (2017) 25 Nasha v. City of Los Angeles, 125 Cal. App. 4th 471 (2004). 26 See Fairfield v. Superior Court, 14 Cal. 3d 768 (1975); Mennig v. City Council, 86 Cal. App. 3d 341 (1978). 27 See generally Cal. Civ. Proc. Code § 1094.5.
28 See Clark v. City of Hermosa Beach, 48 Cal. App. 4th 1152 (1996) (requiring council to rehear an appeal from the planning commission’s decision and provide a fair hearing).
29 See 42 U.S.C. §§ 1983, 1988.
30 See Lacy Street Hospitality Service v. City of Los Angeles, 22 Cal. Rptr. 3d 805 (2004) (depublished 2005 Daily Journal D.A.R. 84). This case may not be cited as precedent and is provided here only as an illustration. 31 Cal. Gov’t Code § 84308.
32 See Cal. Gov’t Code § 84308(a)(3); 2 Cal. Code Regs. § 18438.1. 33 See Cal. Gov’t Code § 84308(b).
34 See Cal. Gov’t Code § 1126.
35 People ex rel. Chapman v. Rapsey, 16 Cal. 2d 636, 641-642 (1940) 36 See Cal. Pub. Cont. Code § 100.
37 Smith v. City of Riverside, 34 Cal. App. 3d 529 (1973). 38 Cal. Gov’t Code §§ 54201 and following.
39 Cal. Pub. Cont. Code §§ 20160-20162.
40 Cal. Pub. Cont. Code §§ 20120-20123.
41 Cal. Pub. Cont. Code § 20163.
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42 See, e.g., Cal. Pub. Cont. Code § 20164.
43 See 2 Cal. Code Regs. § 18703.5.
44 Cal. Gov’t Code § 82029; 2 Cal. Code Regs. § 18229.
45 See Rushworth M. Kidder, Moral Courage: Taking Action When Your Values Are Put to the Test (William Morrow, 2005). 46 See Rushworth M. Kidder, How Good People Make Tough Choices: Resolving the Dilemmas of Ethical Living (Simon and Schuster, 1995) 13-49. 225
APPENDIX C- BROWN ACT AND TELECONFERENCE MEETING REQUIREMENTS 226
Open & Public VI
A GUIDE TO THE RALPH M. BROWN ACT
REVISED JANUARY 2024
Photo credit: Courtesy of the City of West
Hollywood. Photo by Jon Viscott.
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ii OPEN & PUBLIC VI: A GUIDE TO THE RALPH M. BROWN ACT
ACKNOWLEDGEMENTS
ACKNOWLEDGMENTS
Cal Cities thanks the following individuals for their work on this publication:
Brown Act Committee
Tracy M. Noonan, Committee Chair
City Attorney, Thousand Oaks
Amy Ackerman
Town Attorney, Corte Madera; Renne Public Law Group
Sheri Damon
City Attorney, Seaside
Christopher Diaz
City Attorney, Colma and Hillsborough
Best Best & Krieger LLP
Megan J. Marevich
Assistant City Attorney, Mountain View
Javan N. Rad
Chief Assistant City Attorney, Pasadena
Prasanna W. Rasiah
City Attorney, San Mateo
Sujata Reuter
Chief Assistant City Attorney, Santa Clara
Robert Schultz
Attorney
Frank A. Splendorio
City Attorney, Atwater and Plymouth
Best Best & Krieger LLP
Osa Wolff
City Attorney, Orinda
Shute, Mihaly & Weinberger LLP
Cal Cities Staff
Sheri Chapman, General Counsel
Alison Leary, Senior Deputy General Counsel
Janet Leonard, Executive Assistant, Legal Services
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REVISED JANUARY 2024
Open & Public VI
A GUIDE TO THE RALPH M. BROWN ACT
CHAPTER 1: IT IS THE PEOPLE’S BUSINESS.................................................5 CHAPTER 2: LEGISLATIVE BODIES............................................................11 CHAPTER 3: MEETINGS............................................................................17 CHAPTER 4: AGENDAS, NOTICES, AND PUBLIC PARTICIPATION ..............29 CHAPTER 5: CLOSED SESSIONS ...............................................................41 CHAPTER 6: REMEDIES ............................................................................55 229
2 OPEN & PUBLIC VI: A GUIDE TO THE RALPH M. BROWN ACT
TABLE OF CONTENTS
TABLE OF CONTENTS
CHAPTER 1: IT IS THE PEOPLE’S BUSINESS............................................... 5 The right of access ...................................................................................................................6 Broad coverage ........................................................................................................................6 Narrow exemptions .................................................................................................................7 Public participation in meetings ..............................................................................................7 Controversy..............................................................................................................................8 Beyond the law — good business practices............................................................................8 Achieving balance ....................................................................................................................9 Historical note ..........................................................................................................................9 CHAPTER 2: LEGISLATIVE BODIES ........................................................... 11 What is a “legislative body” of a local agency? .....................................................................12 What is not a “legislative body” for purposes of the Brown Act? .........................................14 CHAPTER 3: MEETINGS ...........................................................................17 Brown Act meetings...............................................................................................................18 Six exceptions to the meeting definition...............................................................................18 Collective briefings.................................................................................................................21 Retreats, trainings, and workshops of legislative bodies.......................................................21 Serial meetings.......................................................................................................................22 Informal gatherings ................................................................................................................24 Technological conferencing ...................................................................................................25 Location of meetings..............................................................................................................26 CHAPTER 4: AGENDAS, NOTICES, AND PUBLIC PARTICIPATION.............. 29 Agendas for regular meetings................................................................................................30 Mailed agenda upon written request.....................................................................................31 Notice requirements for special meetings ............................................................................32 Notices and agendas for adjourned and continued meetings and hearings ........................32 Notice requirements for emergency meetings .....................................................................33 Notice of compensation for simultaneous or serial meetings ..............................................33 Educational agency meetings ................................................................................................33 Notice requirements for tax or assessment meetings and hearings....................................33 230
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Non-agenda items..................................................................................................................34 Responding to the public .......................................................................................................35 The right to attend and observe meetings ............................................................................36 Records and recordings .........................................................................................................37 The public’s right to speak during a meeting ........................................................................38 CHAPTER 5: CLOSED SESSIONS ..............................................................41 Agendas and reports..............................................................................................................42 Litigation.................................................................................................................................43 Real estate negotiations ........................................................................................................45 Public employment ................................................................................................................46 Labor negotiations .................................................................................................................47 Labor negotiations — school and community college districts ............................................48 Other Education Code exceptions .........................................................................................48 Joint powers authorities.........................................................................................................48 License applicants with criminal records ..............................................................................49 Public security........................................................................................................................49 Multijurisdictional law enforcement agency .........................................................................49 Hospital peer review and trade secrets.................................................................................49 Other legislative bases for closed session.............................................................................50 Who may attend closed sessions ..........................................................................................50 The confidentiality of closed session discussions .................................................................51 CHAPTER 6: REMEDIES .......................................................................... 55 Invalidation of action taken....................................................................................................56 Declaratory relief to determine whether past action violated the act..................................57 Civil action to prevent future violations.................................................................................57 Costs and attorney’s fees ......................................................................................................58 Misdemeanor penalties..........................................................................................................58 Voluntary resolution...............................................................................................................59 231
4 OPEN & PUBLIC VI: A GUIDE TO THE RALPH M. BROWN ACT 232 OPEN & PUBLIC VI: A GUIDE TO THE RALPH M. BROWN ACT 5 5 Chapter 1
IT IS THE PEOPLE’S BUSINESS
The right of access.............................................................................................................. 6 Broad coverage ................................................................................................................... 6 Narrow exemptions ............................................................................................................ 7 Public participation in meetings ......................................................................................... 7 Controversy......................................................................................................................... 8 Beyond the law — good business practices ...................................................................... 8 Achieving balance............................................................................................................... 9 Historical note..................................................................................................................... 9 OPEN & PUBLIC VI: A GUIDE TO THE RALPH M. BROWN ACT 233 6 OPEN & PUBLIC VI: A GUIDE TO THE RALPH M. BROWN ACT
CHAPTER 1: IT IS THE PEOPLE’S BUSINESS
The right of access
Two key parts of the Brown Act have not changed since its adoption in 1953. One is the act’s initial section, declaring the Legislature’s intent:
“In enacting this chapter, the Legislature finds and declares that the public commissions, boards and councils and the other public agencies in this State exist to aid in the conduct of the people’s business. It is the intent of the law that their actions be taken openly and that their deliberations be conducted openly.
“The people of this State do not yield their sovereignty to the agencies which serve them. The people, in delegating authority, do not give their public servants the right to decide what is good for the people to know and what is not good for them to know. The people insist on remaining informed so that they may retain control over the instruments they have created.”1
The people reconfirmed that intent 50 years later in the November 2004 election by adopting Proposition 59, amending the California Constitution to include a public right of access to government information:
“The people have the right of access to information concerning the conduct of the people’s business, and, therefore, the meetings of public bodies and the writings of public officials and agencies shall be open to public scrutiny.”2 The Brown Act’s other unchanged provision is a single sentence:
“All meetings of the legislative body of a local agency shall be open and public, and all persons shall be permitted to attend any meeting of the legislative body of a local agency, except as otherwise provided in this chapter.”3 That one sentence is by far the most important of the entire Brown Act. If the opening is the soul, that sentence is the heart of the Brown Act.
Broad coverage
The Brown Act covers members of virtually every type of local government body, elected or appointed, decision-making or advisory. Some types of private organizations are covered, as are newly elected members of a legislative body, even before they take office.
Similarly, meetings subject to the Brown Act are not limited to face-to-face gatherings. They also include any communication medium or device through which a majority of a legislative body discusses, deliberates, or takes action on an item of business outside of a noticed meeting. They include meetings held from remote locations by teleconference or videoconference.
Chapter 1
IT IS THE PEOPLE’S BUSINESS
PRACTICE TIP: The key to the
Brown Act is a single sentence.
In summary, all meetings shall
be open and public except
when the Brown Act authorizes
otherwise.
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New communication technologies present new Brown Act challenges. For example, common email practices of forwarding or replying to messages can easily lead to a serial meeting prohibited by the Brown Act, as can participation by members of a legislative body in an internet chatroom or blog dialogue. Social Media posts, comments, and “likes” can result in a Brown Act violation.
Communicating during meetings using electronic technology (such as laptop computers, tablets, or smart phones) may create the perception that private communications are influencing the outcome of decisions, and some state legislatures have banned the practice. On the other hand, widespread video streaming and videoconferencing of meetings has greatly expanded public access to the decision-making process.
Narrow exemptions
The express purpose of the Brown Act is to ensure that local government agencies conduct the public’s business openly and publicly. Courts and the California Attorney General usually broadly construe the Brown Act in favor of greater public access and narrowly construe exemptions to its general rules.4
Generally, public officials should think of themselves as living in glass houses, and that they may only draw the curtains when it is in the public interest to preserve confidentiality. Closed sessions may be held only as specifically authorized by the provisions of the Brown Act itself.
The Brown Act, however, is limited to meetings among a majority of the members of multimember government bodies when the subject relates to local agency business. It does not apply to independent conduct of individual decision-makers. It does not apply to social, ceremonial, educational, and other gatherings as long as a majority of the members of a body do not discuss issues related to their local agency’s business. Meetings of temporary advisory committees — as distinguished from standing committees — made up solely of less than a quorum of a legislative body are not subject to the Brown Act.
The law does not apply to local agency staff or employees, but they may facilitate a violation by acting as a conduit for discussion, deliberation, or action by the legislative body. 5 The law, on the one hand, recognizes the need of individual local officials to meet and discuss matters with their constituents and staff. On the other hand, it requires — with certain specific exceptions to protect the community and preserve individual rights — that the decision-making process be public. Sometimes the boundary between the two is not easy to draw.
Public participation in meetings
In addition to requiring the public’s business to be conducted in open, noticed meetings, the Brown Act also extends to the public the right to participate in meetings. Individuals, lobbyists, and members of the news media possess the right to attend, record, broadcast, and participate in public meetings. The public’s participation is further enhanced by the Brown Act’s requirement that a meaningful agenda be posted in advance of meetings, by limiting discussion and action to matters listed on the agenda, and by requiring that meeting materials be made available.
Legislative bodies may, however, adopt reasonable regulations on public testimony and the conduct of public meetings, including measures to address disruptive conduct and limits on the time allotted to each speaker. For more information, see chapter 4.
PRACTICE TIP: Think of the
government’s house as being
made of glass. The curtains may
be drawn only to further the
public’s interest. A local policy
on the use of laptop computers,
tablets, and smart phones during
Brown Act meetings may help
avoid problems.
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Controversy
Not surprisingly, the Brown Act has been a source of confusion and controversy since its inception.
News media and government watchdogs often argue the law is toothless, pointing out that there has never been a single criminal conviction for a violation. They often suspect that closed sessions are being misused.
Some public officials complain that the Brown Act makes it difficult to respond to constituents and requires public discussions of items better discussed privately, such as why a particular person should not be appointed to a board or commission. Many elected officials find the Brown Act inconsistent with their private business experiences. Closed meetings can be more efficient; they eliminate grandstanding and promote candor. The techniques that serve well in business — the working lunch, the sharing of information through a series of phone calls or emails, the backroom conversations and compromises — are often not possible under the Brown Act.
As a matter of public policy, California (along with many other states) has concluded that there is more to be gained than lost by conducting public business in the open. Government behind closed doors may well be efficient and businesslike, but it may be perceived as unresponsive and untrustworthy.
Beyond the law — good business practices
Violations of the Brown Act can lead to invalidation of an agency’s action, payment of a challenger’s attorney fees, public embarrassment, even criminal prosecution. But the Brown Act is a floor, not a ceiling, for conduct of public officials. This guide is focused not only on the Brown Act as a minimum standard, but also on meeting practices or activities that, legal or not, are likely to create controversy. Problems may crop up, for example, when agenda descriptions are too brief or vague, when an informal gettogether takes on the appearance of a meeting, when an agency conducts too much of its business in closed session or discusses matters in closed session that are beyond the authorized scope, or when controversial issues arise that are not on the agenda.
The Brown Act allows a legislative body to adopt practices and requirements for greater access to meetings for itself and its subordinate committees and bodies that are more stringent than the law itself requires.6 Rather than simply restate the basic requirements of the Brown Act, local open meeting policies should strive to anticipate and prevent problems in areas where the Brown Act does not provide full guidance. As with the adoption of any other significant policy, public comment should be solicited.
A local policy could build on these basic Brown Act goals:
A legislative body’s need to get its business done smoothly. The public’s right to participate meaningfully in meetings, and to review documents used in decision-making at a relevant point in time.
PRACTICE TIP: Transparency
is a foundational value for
ethical government practices.
The Brown Act is a floor, not a
ceiling, for conduct.
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A local agency’s right to confidentially address certain negotiations, personnel matters, claims, and litigation.
The right of the press to fully understand and communicate public agency decision-making.
A detailed and comprehensive public meeting and information policy, especially if reviewed periodically, can be an important element in maintaining or improving public relations. Such a policy exceeds the absolute requirements of the law — but if the law were enough, this guide would be unnecessary. A narrow legalistic approach will not avoid or resolve potential controversies. An agency should consider going beyond the law and look at its unique circumstances to determine if there is a better way to prevent potential problems and promote public trust. At the very least, local agencies need to think about how their agendas are structured in order to make Brown Act compliance easier. They need to plan carefully to make sure public participation fits smoothly into the process.
Achieving balance
The Brown Act should be neither an excuse for hiding the ball nor a mechanism for hindering efficient and orderly meetings. The Brown Act represents a balance among the interests of constituencies whose interests do not always coincide. It calls for openness in local government, yet should allow government to function responsively and productively.
There must be both adequate notice of what discussion and action are to occur during a meeting as well as a normal degree of spontaneity in the dialogue between elected officials and their constituents.
The ability of an elected official to confer with constituents or colleagues must be balanced against the important public policy prohibiting decision-making outside of public meetings.
In the end, implementation of the Brown Act must ensure full participation of the public and preserve the integrity of the decision-making process, yet not stifle government officials and impede the effective and natural operation of government.
Historical note
In late 1951, San Francisco Chronicle reporter Mike Harris spent six weeks looking into the way local agencies conducted meetings. State law had long required that business be done in public, but Harris discovered secret meetings or caucuses were common. He wrote a 10-part series titled “Your Secret Government” that ran in May and June 1952.
Out of the series came a decision to push for a new state open-meeting law. Harris and Richard (Bud) Carpenter, legal counsel for the League of California Cities, drafted such a bill and Assembly Member Ralph M. Brown agreed to carry it. The Legislature passed the bill, and Governor Earl Warren signed it into law in 1953.
The Ralph M. Brown Act, known as the Brown Act, has evolved under a series of amendments and court decisions, and has been the model for other open-meeting laws, such as the Bagley-Keene Act, enacted in 1967 to cover state agencies.
Assembly Member Brown is best known for the open-meeting law that carries his name. He was elected to the Assembly in 1942 and served 19 years, including the last three years as Speaker. He then became an appellate court justice.
PRACTICE TIP: The Brown Act
should be viewed as a tool
to facilitate the business of
local government agencies.
Local policies that go beyond
the minimum requirements
of law may help instill public
confidence and avoid problems.
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Updates to this publication responding to changes in the Brown Act or new court interpretations are available at https://www.calcities.org/home/resources/open-government2. A current version of the Brown Act may be found at https://leginfor.legislature.ca.gov.
ENDNOTES
1 Cal. Gov. Code, § 54950.
2 Cal. Const., Art. 1, § 3, subd. (b)(1).
3 Cal. Gov. Code, § 54953, subd. (a).
4 This principle of broad construction when it furthers public access and narrow construction if a provision limits public access is also stated in the amendment to the State’s Constitution adopted by Proposition 59 in 2004. California Const., Art. 1, § 3, subd. (b)(2). 5 Cal. Gov. Code, § 54952.2, subds. (b)(2) and (c)(1); Wolfe v. City of Fremont (2006) 144 Cal.App.4th 533.
6 Cal. Gov. Code, § 54953.7.
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LEGISLATIVE BODIES
What is a “legislative body” of a local agency? ................................................................ 12 What is not a “legislative body” for purposes of the Brown Act? .................................... 14 239
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The Brown Act applies to the legislative bodies of local agencies. It defines “legislative body” broadly to include just about every type of decision-making body of a local agency.1 What is a “legislative body” of a local agency?
A “legislative body” includes the following:
The “governing body of a local agency” and certain of its subsidiary bodies; “or any other local body created by state or federal statute.”2 This includes city councils, boards of supervisors, school boards, and boards of trustees of special districts. A “local agency” is any city, county, city and county, school district, municipal corporation, successor agency to a redevelopment agency, district, political subdivision, or other local public agency.3 A housing authority is a local agency under the Brown Act even though it is created by and is an agent of the state.4 The California Attorney General has opined that air pollution control districts and regional open space districts are also covered.5 Entities created pursuant to joint powers agreements are also local agencies within the meaning of the Brown Act.6
Newly elected members of a legislative body who have not yet assumed office must conform to the requirements of the Brown Act as if already in office.7 Thus, meetings between incumbents and newly elected members of a legislative body, such as a meeting between two outgoing members and a member-elect of a five-member body, could violate the Brown Act.
Q. On the morning following the election to a five-member legislative body of a local agency, two successful candidates, neither an incumbent, meet with an incumbent member of the legislative body for a celebratory breakfast. Does this violate the Brown Act?
A. It might, and absolutely would if the conversation turns to agency business. Even though the candidates-elect have not officially been sworn in, the Brown Act applies.
If purely a social event, there is no violation, but it would be preferable if others were invited to attend to avoid the appearance of impropriety.
Chapter 2
LEGISLATIVE BODIES
PRACTICE TIP: The prudent
presumption is that an advisory
committee or task force is
subject to the Brown Act. Even
if one clearly is not, it may want
to comply with the Brown Act.
Public meetings may reduce the
possibility of misunderstandings
and controversy.
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Appointed bodies — whether permanent or temporary, decision-making or advisory — including planning commissions, civil service commissions, and other subsidiary committees, boards, and bodies. Volunteer groups, executive search committees, task forces, and blue ribbon committees created by formal action of the governing body are legislative bodies. When the members of two or more legislative bodies are appointed to serve on an entirely separate advisory group, the resulting body may be subject to the Brown Act. In one reported case, a city council created a committee of two members of the city council and two members of the city planning commission to review qualifications of prospective planning commissioners and make recommendations to the council. The court held that their joint mission made them a legislative body subject to the Brown Act.
Had the two committees remained separate and met only to exchange information and report back to their respective boards, they would have been exempt from the Brown Act.8 Standing committees of a legislative body, irrespective of their composition, which have either (1) a continuing subject matter jurisdiction or (2) a meeting schedule fixed by charter, ordinance, resolution, or formal action of a legislative body.9 Even if it comprises less than a quorum of the governing body, a standing committee is subject to the Brown Act.
For example, if a governing body creates committees on budget and finance or on public safety that are not limited in duration or scope, those are standing committees subject to the Brown Act. Further, according to the California Attorney General, function over form controls. For example, a statement by the legislative body that the advisory committee “shall not exercise continuing subject matter jurisdiction” or the fact that the committee does not have a fixed meeting schedule is not determinative.10 “Formal action” by a legislative body includes authorization given to the agency’s executive officer to appoint an advisory committee pursuant to agency-adopted policy.11 A majority of the members of a legislative body may attend an open and public meeting of a standing committee of that body, provided the members who are not part of the standing committee only observe.12 For more information, see chapter 3.
The governing body of any private organization either (1) created by the legislative body in order to exercise authority that may lawfully be delegated by such body to a private corporation, limited liability company, or other entity or (2) that receives agency funding and whose governing board includes a member of the legislative body of the local agency appointed by the legislative body as a full voting member of the private entity’s governing board.13 These include some nonprofit corporations created by local agencies.14 If a local agency contracts with a private firm for a service (for example, payroll, janitorial, or food services), the private firm is not covered by the Brown Act.15 When a member of a legislative body sits on a board of a private organization as a private person and is not appointed by the legislative body, the board will not be subject to the Brown Act. Similarly, when the legislative body appoints someone other than one of its own members to such boards, the Brown Act does not apply. Nor does it apply when a private organization merely receives agency funding.16
PRACTICE TIP: It can be difficult
to determine whether a
subcommittee of a body falls
into the category of a standing
committee or an exempt
temporary committee. Suppose a
committee is created to explore
the renewal of a franchise or a
topic of similarly limited scope
and duration. Is it an exempt
temporary committee or a
nonexempt standing committee?
The answer may depend on
factors such as how meeting
schedules are determined, the
scope of the committee’s charge,
or whether the committee exists
long enough to have “continuing
jurisdiction.”
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Q. The local chamber of commerce is funded in part by the city. The mayor sits on the chamber’s board of directors. Is the chamber board a legislative body subject to the Brown Act?
A. Maybe. If the chamber’s governing documents require the mayor to be on the board and the city council appoints the mayor to that position, the board is a legislative body. If, however, the chamber board independently appoints the mayor to its board, or the mayor attends chamber board meetings in a purely advisory capacity, it is not.
Q. If a community college district board creates an auxiliary organization to operate a campus bookstore or cafeteria, is the board of the organization a legislative body? A. Yes. But if the district instead contracts with a private firm to operate the bookstore or cafeteria, the Brown Act would not apply to the private firm. Certain types of hospital operators. A lessee of a hospital (or portion of a hospital) first leased under Health and Safety Code subsection 32121(p) after Jan. 1, 1994, which exercises “material authority” delegated to it by a local agency, whether or not such lessee is organized and operated by the agency or by a delegated authority.17 What is not a “legislative body” for purposes of the Brown Act? A temporary advisory committee composed solely of less than a quorum of the legislative body that serves a limited or single purpose, that is not perpetual, and that will be dissolved once its specific task is completed is not subject to the Brown Act.18 Temporary committees are sometimes called ad hoc committees, a term not used in the Brown Act. Examples include an advisory committee composed of less than a quorum created to interview candidates for a vacant position or to meet with representatives of other entities to exchange information on a matter of concern to the agency, such as traffic congestion.19
Groups advisory to a single decision-maker or appointed by staff are not covered. The Brown Act applies only to committees created by formal action of the legislative body and not to committees created by others. A committee advising a superintendent of schools would not be covered by the Brown Act. However, the same committee, if created by formal action of the school board, would be covered.20
Q. A member of the legislative body of a local agency informally establishes an advisory committee of five residents to advise her on issues as they arise. Does the Brown Act apply to this committee?
A. No, because the committee has not been established by formal action of the legislative body.
Q. During a meeting of the city council, the council directs the city manager to form an advisory committee of residents to develop recommendations for a new ordinance. The city manager forms the committee and appoints its members; the committee is instructed to direct its recommendations to the city manager. Does the Brown Act apply to this committee?
A. Possibly, because the direction from the city council might be regarded as a formal action of the body, notwithstanding that the city manager controls the committee. 242
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Individual decision-makers who are not elected or appointed members of a legislative body are not covered by the Brown Act. For example, a disciplinary hearing presided over by a department head or a meeting of agency department heads is not subject to the Brown Act since such assemblies are not those of a legislative body.21 Public employees, each acting individually and not engaging in collective deliberation on a specific issue, such as the drafting and review of an agreement, do not constitute a legislative body under the Brown Act, even if the drafting and review process was established by a legislative body.22
County central committees of political parties are also not Brown Act bodies.23 Legal counsel for a governing body is not a member of the governing body, therefore, the Brown Act does not apply to them. But counsel should take care not to facilitate Brown Act violations by members of the governing body.24
ENDNOTES
1 Taxpayers for Livable Communities v. City of Malibu (2005) 126 Cal.App.4th 1123, 1127. 2 Cal. Gov. Code, § 54952, subds. (a) and (b).
3 Cal. Gov. Code, § 54951; Cal. Health & Saf. Code, § 34173, subd. (g) (successor agencies to former redevelopment agencies subject to the Brown Act). But see Cal. Ed. Code § 35147, which exempts certain school councils and school site advisory committees from the Brown Act and imposes upon them a separate set of rules.
4 Torres v. Board of Commissioners of Housing Authority of Tulare County (1979) 89 Cal.App.3d 545, 549- 550.
5 71 Ops.Cal.Atty.Gen. 96 (1988); 73 Ops.Cal.Atty.Gen. 1 (1990). 6 McKee v. Los Angeles Interagency Metropolitan Police Apprehension Crime Task Force (2005) 134 Cal.
App.4th 354, 362.
7 Cal. Gov. Code, § 54952.1.
8 Joiner v. City of Sebastopol (1981) 125 Cal.App.3d 799, 804-805. 9 Cal. Gov. Code, § 54952, subd. (b)
10 79 Ops.Cal.Atty.Gen. 69 (1996).
11 Frazer v. Dixon Unified School District (1993) 18 Cal.App.4th 781, 793. 12 Cal. Gov. Code § 54952, subd. (c)(6).
13 Cal. Gov. Code, § 54952, subd. (c)(1). Regarding private organizations that receive local agency funding, the same rule applies to a full voting member appointed prior to February 9, 1996, who, after that date, is made a nonvoting board member by the legislative body. Cal. Gov. Code § 54952, subd. (c)(2).
14 Cal. Gov. Code, § 54952(c)(1)(A); International Longshoremen’s and Warehousemen’s Union v. Los Angeles Export Terminal, Inc. (1999) 69 Cal.App.4th 287, 300; Epstein v. Hollywood Entertainment Dist. II Business Improvement District (2001) 87 Cal.App.4th 862, 876; see also 85 Ops.Cal.Atty.Gen. 55 (2002).
15 International Longshoremen’s and Warehousemen’s Union v. Los Angeles Export Terminal, Inc. (1999) 69 Cal.App.4th 287, 300 fn. 5.
16 “The Brown Act, Open Meetings for Local Legislative Bodies,” California Attorney General’s Office (2003), p. 7.
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17 Cal. Gov. Code, § 54952, subd. (d).
18 Cal. Gov. Code, § 54952, subd. (b); see also Freedom Newspapers, Inc. v. Orange County Employees Retirement System Board of Directors (1993) 6 Cal.4th 821, 832. 19 Taxpayers for Livable Communities v. City of Malibu (2005) 126 Cal.App.4th 1123, 1129. 20 56 Ops.Cal.Atty.Gen. 14, 16-17 (1973).
21 Wilson v. San Francisco Municipal Railway (1973) 29 Cal.App.3d 870, 878-879. 22 Golightly v. Molina (2014) 229 Cal.App.4th 1501, 1513. 23 59 Ops.Cal.Atty.Gen. 162, 164 (1976).
24 GFRCO, Inc. v. Superior Court of Riverside County (2023) 89 Cal.App.5th 1295, 1323; Stockton Newspapers, Inc. v. Redevelopment Agency of the City of Stockton (1985) 171 Cal.App.3d 95, 105 (a series of individual telephone calls between the agency attorney and the members of the body constituted a meeting).
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MEETINGS
Brown Act meetings ......................................................................................................... 18 Six exceptions to the meeting definition.......................................................................... 18 Collective briefings............................................................................................................ 21 Retreats, trainings, and workshops of legislative bodies ................................................. 21 Serial meetings ................................................................................................................. 22 Informal gatherings........................................................................................................... 24 Technological conferencing .............................................................................................. 25 Location of meetings ........................................................................................................ 26 245
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CHAPTER 3: MEETINGS
The Brown Act only applies to meetings of local legislative bodies. It defines a meeting as “any congregation of a majority of the members of a legislative body at the same time and location, including teleconference location as permitted by Section 54953, to hear, discuss, deliberate, or take any action on any item that is within the subject matter jurisdiction of the legislative body.”1 The term meeting is not limited to gatherings at which action is taken but includes deliberative gatherings as well. A hearing before an individual hearing officer is not a meeting under the Brown Act because it is not a hearing before a legislative body.2
Brown Act meetings
Brown Act meetings include a legislative body’s regular meetings, special meetings, emergency meetings, and adjourned meetings.
“Regular meetings” are meetings occurring at the dates, times, and location set by resolution, ordinance, or other formal action by the legislative body and are subject to 72- hour posting requirements.3
“Special meetings” are meetings called by the presiding officer or majority of the legislative body to discuss only discrete items on the agenda under the Brown Act’s notice requirements for special meetings and are subject to 24-hour posting requirements.4 “Emergency meetings” are a limited class of meetings held when prompt action is needed due to actual or threatened disruption of public facilities and are held on little notice.5 “Adjourned meetings” are regular or special meetings that have been adjourned or re-adjourned to a time and place specified in the order of adjournment, with no agenda required for regular meetings adjourned for less than five calendar days as long as no additional business is transacted.6
Six exceptions to the meeting definition
The Brown Act creates six exceptions to the meeting definition:7 Individual contacts
The first exception involves individual contacts between a member of the legislative body and any other person. The Brown Act does not limit a legislative body member acting on their own. This exception recognizes the right to confer with constituents, advocates, consultants, news reporters, local agency staff, or a colleague.
Individual contacts, however, cannot be used to do in stages what would be prohibited in one step. For example, a series of individual contacts that leads to discussion, deliberation, or action among a majority of the members of a legislative body is prohibited. Such serial meetings are discussed below.
Chapter 3
MEETINGS
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Conferences
The second exception allows a legislative body majority to attend a conference or similar gathering open to the public that addresses issues of general interest to the public or to public agencies of the type represented by the legislative body.
Among other things, this exception permits legislative body members to attend annual association conferences of city, county, school, community college, and other local agency officials, as long as those meetings are open to the public. However, a majority of members cannot discuss among themselves, other than as part of the scheduled program, business of a specific nature that is within their local agency’s subject matter jurisdiction.
Community meetings
The third exception allows a legislative body majority to attend an open and publicized meeting held by another organization to address a topic of local community concern. A majority cannot discuss among themselves, other than as part of the scheduled program, business of a specific nature that is within the legislative body’s subject matter jurisdiction. Under this exception, a legislative body majority may attend a local service club meeting or a local candidates’ night if the meetings are open to the public.
“I see we have four distinguished members of the city council at our meeting tonight,” said the chair of the Environmental Action Coalition. “I wonder if they have anything to say about the controversy over enacting a slow growth ordinance?”
The Brown Act permits a majority of a legislative body to attend and speak at an open and publicized meeting conducted by another organization. The Brown Act may nevertheless be violated if a majority discusses, deliberates, or takes action on an item during the meeting of the other organization. There is a fine line between what is permitted and what is not; hence, members should exercise caution when participating in these types of events.
Q. The local chamber of commerce sponsors an open and public candidate debate during an election campaign. Three of the five agency members are up for reelection and all three participate. All of the candidates are asked their views on a controversial project scheduled for a meeting to occur just after the election. May the three incumbents answer the question?
A. Yes, because the chamber of commerce, not the city, is organizing the debate. The city should not sponsor the event or assign city staff to help organize or run the event. Also, the Brown Act does not constrain the incumbents from expressing their views regarding important matters facing the local agency as part of the political process the same as any other candidates. Finally, incumbents participating in the event should take care to limit their remarks to the program set by the chamber and safeguard due process by indicating they will keep an open mind regarding specific applications that might come before the council.
Q. May the three incumbents accept an invitation from the editorial board of a local paper to all candidates to meet as a group and answer questions about and/or debate city issues?
A. No, unlike the chamber of commerce event, this would not be allowed under the Brown Act because it is not an open and publicized meeting. 247
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Other legislative bodies
The fourth exception allows a majority of a legislative body to attend an open and publicized meeting of (1) another body of the local agency and (2) a legislative body of another local agency.8 Again, the majority cannot discuss among themselves, other than as part of the scheduled meeting, business of a specific nature that is within their subject matter jurisdiction. This exception allows, for example, a city council or a majority of a board of supervisors to attend a controversial meeting of the planning commission.
Nothing in the Brown Act prevents the majority of a legislative body from sitting together at such a meeting. They may choose not to, however, to preclude any possibility of improperly discussing local agency business and to avoid the appearance of a Brown Act violation. Further, aside from the Brown Act, there may be other reasons, such as due process considerations, why the members should avoid giving public testimony, trying to influence the outcome of proceedings before a subordinate body, or discussing the merits with interested parties.
Q. The entire legislative body intends to testify against a bill before the Senate Local Government Committee in Sacramento. Must this activity be noticed as a meeting of the body?
A. No, because the members are attending and participating in an open meeting of another governmental body that the public may attend.
Q. The members then proceed upstairs to the office of their local assembly member to discuss issues of local interest. Must this session be noticed as a meeting and be open to the public?
A. Yes, because the entire body may not meet behind closed doors except for proper closed sessions. The same answer applies to a private lunch or dinner with the assembly member.
Standing committees
The fifth exception authorizes the attendance of a majority at an open and noticed meeting of a standing committee of the legislative body, provided that the legislative body members who are not members of the standing committee attend only as observers (meaning that they cannot speak or otherwise participate in the meeting, and they must sit where members of the public sit).9 Q. The legislative body establishes a standing committee of two of its five members that meets monthly. A third member of the legislative body wants to attend these meetings and participate. May she?
A. She may attend, but only as an observer; she may not participate.
Q. Can the legislative body establish multiple standing committees with partially overlapping jurisdiction?
A. Yes. One result of this overlap in jurisdiction may be that three or more of the members of the legislative body ultimately end up discussing an issue as part of a standing committee meeting. This is allowed under the Brown Act provided each standing committee meeting is publicly noticed and no more than two of the five members discuss the issue at any given standing committee meeting.
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Social or ceremonial events
The final exception permits a majority of a legislative body to attend a purely social or ceremonial occasion. Once again, a majority cannot discuss business among themselves of a specific nature that is within the subject matter jurisdiction of the legislative body.
Nothing in the Brown Act prevents a majority of members from attending the same football game, party, wedding, funeral, reception, or farewell. The test is not whether a majority of a legislative body attend the function, but whether business of a specific nature within the subject matter jurisdiction of the body is discussed. As long as no such business is discussed, there is no violation of the Brown Act.
Grand Jury Testimony
In addition, members of a legislative body, either individually or collectively, may give testimony in private before a grand jury.10 This is the equivalent of a seventh exception to the Brown Act’s definition of a “meeting.”
Collective briefings
None of these exceptions permits a majority of a legislative body to meet together with staff in advance of a meeting for a collective briefing. Any such briefings that involve a majority of the body in the same place and time must be open to the public and satisfy Brown Act meeting notice and agenda requirements. Staff may provide written briefings (e.g., staff updates, emails from the city manager, confidential memos from the city attorney) to the full legislative body, but apart from privileged memos, the written materials may be subject to disclosure as public records as discussed in chapter 4.
Retreats, trainings, and workshops of legislative bodies Gatherings by a majority of legislative body members at the legislative body’s retreats, study sessions, trainings, or workshops are subject to the requirements of the Brown Act. This is the case whether the gathering focuses on long-range agency planning, discussion of critical local issues, satisfying state-mandated ethics training requirements, or team building and group dynamics.11
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Q. The legislative body wants to hold a team-building session to improve relations among its members. May such a session be conducted behind closed doors? A. No, this is not a proper subject for a closed session, and there is no other basis to exclude the public. Council relations are a matter of public business.
Serial meetings
One of the most frequently asked questions about the Brown Act involves serial meetings. At any one time, such meetings include only a portion of a legislative body, but eventually they comprise a majority. The Brown Act provides that “[a] majority of the members of a legislative body shall not, outside a meeting … use a series of communications of any kind, directly or through intermediaries, to discuss, deliberate, or take action on any item of business that is within the subject matter jurisdiction of the legislative body.”12 The problem with serial meetings is the process, which deprives the public of an opportunity for meaningful observation of and participation in legislative body decision-making.
The serial meeting may occur by either a “daisy chain” or a “hub and spoke” sequence. In the daisy chain scenario, Member A contacts Member B, Member B contacts Member
C, Member C contacts Member D, and so on until a quorum has discussed, deliberated, or taken action on an item within the legislative body’s subject matter jurisdiction. The hub and spoke process involves at least two scenarios. In the first scenario, Member A (the hub) sequentially contacts Members B, C, D, and so on (the spokes) until a quorum has been contacted. In the second scenario, a staff member (the hub), functioning as an intermediary for the legislative body or one of its members, communicates with a majority of members (the spokes) one by one for discussion, deliberation, or a decision on a proposed action.13 Another example of a serial meeting is when a chief executive officer (the hub) briefs a majority of members (the spokes) prior to a formal meeting and, in the process, information about the members’ respective views is revealed.
Each of these scenarios violates the Brown Act.
A legislative body member has the right, if not the duty, to meet with constituents to address their concerns. That member also has the right to confer with a colleague (but not with a majority of the body, counting the member) or appropriate staff about local agency business. An employee or official of a local agency may engage in separate conversations or communications outside of an open and noticed meeting “with members of a legislative body in order to answer questions or provide information regarding a matter that is within the subject matter jurisdiction of the local agency if that person does not communicate to members of the legislative body the comments or position of any other member or members of the legislative body.”14 The Brown Act is violated, however, if several one-on-one meetings or conferences lead to a discussion, deliberation, or action by a majority. In one case, a violation occurred when a quorum Photo credit: Courtesy of the City of West
Hollywood. Photo by Jon Viscott.
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of a city council, by a letter that had been circulated among members outside of a formal meeting, directed staff to take action in an eminent domain proceeding.15 A unilateral written communication to the legislative body, such as an informational or advisory memorandum, does not violate the Brown Act.16 Such a memo, however, may be a public record.17 The phone call was from a lobbyist. “Say, I need your vote for that project in the south area. How about it?”
“Well, I don’t know,” replied Board Member Aletto. “That’s kind of a sticky proposition. You sure you need my vote?”
“Well, I’ve got Bradley and Cohen lined up and another vote leaning. With you, I’d be over the top.”
Moments later, the phone rings again. “Hey, I’ve been hearing some rumbles on that south area project,” said the newspaper reporter. “I’m counting noses.
How are you voting on it?”
The lobbyist and the reporter are facilitating a violation of the Brown Act. The board member may have violated the Brown Act by hearing about the positions of other board members and indeed coaxing the lobbyist to reveal the other board members’ positions by asking, “You sure you need my vote?” The prudent course is to avoid such leading conversations and to caution lobbyists, staff, and news media against revealing such positions of others.
The mayor sat down across from the city manager. “From now on,” he declared, “I want you to provide individual briefings on upcoming agenda items. Some of this material is very technical, and the council members don’t want to sound like idiots asking about it in public. Besides that, briefings will speed up the meeting.”
Agency employees or officials may have separate conversations or communications outside of an open and noticed meeting “with members of a legislative body in order to answer questions or provide information regarding a matter that is within the subject matter jurisdiction of the local agency if that person does not communicate to members of the legislative body the comments or position of any other member or members of the legislative body.”18 Members should always be vigilant when discussing local agency business with anyone to avoid conversations that could lead to a discussion, deliberation, or action taken among the majority of the legislative body. “Thanks for the information,” said Council Member Kim. “These zoning changes can be tricky, and now I think I’m better equipped to make the right decision.” “Glad to be of assistance,” replied the planning director. “I’m sure Council Member Jones is OK with these changes. How are you leaning?” “Well,” said Council Member Kim, “I’m leaning toward approval. I know that two of my colleagues definitely favor approval.”
PRACTICE TIP: When briefing
legislative body members,
staff must exercise care not to
disclose other members’ views
and positions.
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The planning director should not disclose Jones’ prospective vote, and Kim should not disclose the prospective votes of two colleagues. Under these facts, there likely has been a serial meeting in violation of the Brown Act.
Q. Various social media platforms and websites include forums where agency employees and officials can discuss issues of local agency business. Members of the legislative body participate regularly. Does this scenario present a potential for violation of the Brown Act?
A. Yes, because it is a technological device that may serve to allow for a majority of members to discuss, deliberate, or take action on matters of agency business.
Q. A member of a legislative body contacts two other members on a five-member body relative to scheduling a special meeting. Is this an illegal serial meeting? A. No, the Brown Act expressly allows a majority of a body to call a special meeting, though the members should avoid discussing the merits of what is to be taken up at the meeting.
Particular care should be exercised when staff briefings of legislative body members occur by email because of the ease of using the “reply all” option that may inadvertently result in a Brown Act violation. Staff should consider using the “bcc” (blind carbon copy) option when addressing an email to multiple members of the legislative body and remind recipients not to “reply all.” Social media should also be used with care. A member of the legislative body cannot respond directly to any communication on an internet-based social media platform that is made, posted, or shared by any other member of the legislative body. This applies to matters within the subject matter jurisdiction of the legislative body. For example, if one member of a legislative body “likes” a social media post of one other member of the same body, that could violate the Brown Act, depending on the nature of the post.19
Finally, electronic communications (such as text messaging) among members of a legislative body during a public meeting should be discouraged. If such communications are sent to a majority of members of the body, either directly or through an intermediary, on a matter on the meeting agenda, that could violate the Brown Act. Electronic communications sent to less than a majority of members of the body during a quasi-judicial proceeding could potentially raise due process concerns, even if not per se prohibited by the Brown Act. Additionally, some legislative bodies have rules governing electronic communications during meetings of the legislative body and how their members should proceed if they receive a communication on an agenda item that is not part of the record or not part of an agenda packet.
Informal gatherings
Members of legislative bodies are often tempted to mix business with pleasure — for example, by holding a post-meeting gathering. Informal gatherings at which local agency business is discussed or transacted violate the law if they are not conducted in conformance with the Brown Act.20 A gathering at which a quorum of the legislative body discusses matters within their jurisdiction violates the Brown Act even if that gathering occurs in a public place. The Brown Act is not satisfied by public visibility alone. It also requires public notice and an opportunity to attend, hear, and participate.
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Thursday at 11:30 a.m., as they did every week, the board of directors of the Dry Gulch Irrigation District trooped into Pop’s Donut Shoppe for an hour of talk and fellowship. They sat at the corner window, fronting on Main and Broadway, to show they had nothing to hide. Whenever he could, the managing editor of the weekly newspaper down the street hurried over to join the board.
A gathering like this would not violate the Brown Act if board members scrupulously avoided talking about irrigation district issues — which might be difficult. This kind of situation should be avoided. The public is unlikely to believe the board members could meet regularly without discussing public business. A newspaper executive’s presence does not lessen the potential for a violation of the Brown Act.
Technological conferencing
Except for certain non-substantive purposes, such as scheduling a special meeting, a conference call including a majority of the members of a legislative body is an unlawful meeting. But in an effort to keep up with modern technologies, the Brown Act specifically allows a legislative body to use any type of teleconferencing to meet, receive public comment and testimony, deliberate, or conduct a closed session.21 While the Brown Act contains specific requirements for conducting a teleconference, the decision to use teleconferencing is entirely discretionary with the body. No person has a right under the Brown Act to have a meeting by teleconference.
Teleconference is defined as “a meeting of a legislative body, the members of which are in different locations, connected by electronic means, through either audio or video, or both.”22 In addition to the specific requirements relating to teleconferencing, the meeting must comply with all provisions of the Brown Act otherwise applicable.
The Brown Act contains the following teleconferencing requirements:23 Teleconferencing may be used for all purposes during any meeting. At least a quorum of the legislative body must participate from locations within the local agency’s jurisdiction.
Additional teleconference locations may be made available for the public. Each teleconference location must be specifically identified in the notice and agenda of the meeting, including a full address and room number, as may be applicable. Agendas must be posted at each teleconference location, even if a hotel room or a residence. Each teleconference location, including a hotel room or residence, must be accessible to the public and have technology, such as a speakerphone, to enable the public to participate The agenda must provide the opportunity for the public to address the legislative body directly at each teleconference location.
All votes must be by roll call.
Photo credit: Courtesy of the City of West
Hollywood. Photo by Jon Viscott.
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Q. A member on vacation wants to participate in a meeting of the legislative body and vote by cellular phone from her car while driving from Washington, D.C., to New York. May she? A. She may not participate or vote because she is not in an open, noticed, and posted teleconference location.
Until Jan. 1, 2026, teleconferencing may also be used on a limited basis where a member indicates their need to participate remotely for “just cause” (e.g., childcare or a contagious illness) or due to “emergency circumstances” (e.g., a physical or family medical emergency).
This teleconferencing option has extremely detailed requirements, and careful review is needed. If the City experiences a technical issue that prevents members of the public from viewing the meeting and/or offering comments virtually, then no further action can be taken until the technical issue is resolved.24
The use of teleconferencing to conduct a legislative body meeting presents a variety of issues beyond the scope of this guide to discuss in detail.
Therefore, before teleconferencing a meeting, legal counsel for the local agency should be consulted.
Location of meetings
The Brown Act generally requires all regular and special meetings of a legislative body, including retreats and workshops, to be held within the boundaries of the territory over which the local agency exercises jurisdiction.25
An open and publicized meeting of a legislative body may be held outside of agency boundaries if the purpose of the meeting is one of the following:26
Comply with state or federal law or a court order, or attend a judicial conference or administrative proceeding in which the local agency is a party. Inspect real or personal property that cannot be conveniently brought into the local agency’s territory, provided the meeting is limited to items relating to that real or personal property.
Q. The agency is considering approving a major retail mall. The developer has built other similar malls and invites the entire legislative body to visit a mall outside the jurisdiction. May the entire body go?
A. Yes, the Brown Act permits meetings outside the boundaries of the agency for specified reasons and inspection of property is one such reason. The field trip must be treated as a meeting and the public must be allowed to attend. Participate in multiagency meetings or discussions; however, such meetings must be held within the boundaries of one of the participating agencies, and all of those agencies must give proper notice.
Meet in the closest meeting facility if the local agency has no meeting facility within its boundaries, or meet at its principal office if that office is located outside the territory over which the agency has jurisdiction.
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Meet with elected or appointed federal or California officials when a local meeting would be impractical, solely to discuss a legislative or regulatory issue affecting the local agency and over which the federal or state officials have jurisdiction. Meet in or nearby a facility owned by the agency, provided that the topic of the meeting is limited to items directly related to the facility.
Visit the office of its legal counsel for a closed session on pending litigation when to do so would reduce legal fees or costs.27
In addition, the governing board of a school or community college district may hold meetings outside of its boundaries to attend a conference on nonadversarial collective bargaining techniques, interview candidates for school district superintendent, or interview a potential employee from another district.28 A school board may also interview members of the public residing in another district if the board is considering employing that district’s superintendent.
Similarly, meetings of a joint powers authority can occur within the territory of at least one of its member agencies, and a joint powers authority with members throughout the state may meet anywhere in the state.29
Finally, if a fire, flood, earthquake, or other emergency makes the usual meeting place unsafe, the presiding officer can designate another meeting place for the duration of the emergency. News media that have requested notice of meetings must be notified of the designation by the most rapid means of communication available.30 State law has also allowed for virtual meetings under certain emergency situations.31
ENDNOTES
1 Cal. Gov. Code, § 54952.2, subd. (a).
2 Wilson v. San Francisco Municipal Railway (1973) 29 Cal.App.3d 870. 3 Cal. Gov. Code, § 54954, subd. (a).
4 Cal. Gov. Code, § 54956.
5 Cal. Gov. Code, § 54956.5.
6 Cal. Gov. Code, § 54955.
7 Cal. Gov. Code, § 54952.2, subd. (c).
8 Cal. Gov. Code, § 54952.2, subd. (c)(4).
9 Cal. Gov. Code, § 54952.2, subd. (c)(6). See 81 Ops.Cal.Atty.Gen. 156 (1998). 10 Cal. Gov. Code, § 54953.1.
11 “The Brown Act,” California Attorney General (2003), p. 10. 12 Cal. Gov. Code, § 54952.2, subd. (b)(1).
13 Stockton Newspapers, Inc. v. Redevelopment Agency of the City of Stockton (1985) 171 Cal.App.3d 95. 14 Cal. Gov. Code, § 54952.2, subd. (b)(2).
15 Common Cause v. Stirling (1983) 147 Cal.App.3d 518.
16 Roberts v. City of Palmdale (1993) 5 Cal.4th 363.
17 Cal. Gov. Code, § 54957.5, subd. (a).
18 Cal. Gov. Code, § 54952.2, subd. (b)(2).
19 Cal. Gov. Code, § 54952.2, subd. (b)(3).
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20 Cal. Gov. Code, § 54952.2; 43 Ops.Cal.Atty.Gen. 36 (1964). 21 Cal. Gov. Code, § 54953, subd. (b)(1).
22 Cal. Gov. Code, § 54953, subd. (b)(4).
23 Cal. Gov. Code, § 54953. Until Jan. 1, 2024, the legislative body could use teleconferencing “during a proclaimed state of emergency” by the Governor in specified circumstances, and teleconference locations were exempt from certain requirements, such as identification in and posting of the agenda. 24 Cal Gov. Code, § 54953, subd. (f) (which will become Govt. §54953(e) as of Jan. 1, 2024). 25 Cal. Gov. Code, § 54954, subd. (b).
26 Cal. Gov. Code, § 54954, subd. (b)(1)-(7).
27 94 Ops.Cal.Atty.Gen. 15 (2011).
28 Cal. Gov. Code, § 54954, subd. (c).
29 Cal. Gov. Code, § 54954, subd. (d).
30 Cal. Gov. Code, § 54954, subd. (e).
31 Cal. Gov. Code, § 54953, subd. (e) (exp. January 1, 2026). 256
OPEN & PUBLIC VI: A GUIDE TO THE RALPH M. BROWN ACT OPEN & PUBLIC VI: A GUIDE TO THE RALPH M. BROWN ACT29 29 Chapter 4
AGENDAS, NOTICES, AND PUBLIC PARTICIPATION
Agendas for regular meetings .......................................................................................... 30 Mailed agenda upon written request ............................................................................... 31 Notice requirements for special meetings ....................................................................... 32 Notices and agendas for adjourned and continued meetings and hearings ................... 32 Notice requirements for emergency meetings ................................................................ 33 Notice of compensation for simultaneous or serial meetings ......................................... 33 Educational agency meetings........................................................................................... 33 Notice requirements for tax or assessment meetings and hearings............................... 33 Non-agenda items............................................................................................................. 34 Responding to the public .................................................................................................. 35 The right to attend and observe meetings ....................................................................... 36 Records and recordings .................................................................................................... 37 The public’s right to speak during a meeting ................................................................... 38 257
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Chapter 4
AGENDAS, NOTICES, AND PUBLIC PARTICIPATION
Effective notice is essential for an open and public meeting.
Whether a meeting is open or how the public may participate in that meeting is academic if nobody knows about the meeting.
Agendas for regular meetings
Every regular meeting of a legislative body of a local agency — including advisory committees, commissions, or boards, as well as standing committees of legislative bodies — must be preceded by a posted agenda that advises the public of the meeting and the matters to be transacted or discussed.
The agenda must be posted at least 72 hours before the regular meeting in a location “freely accessible to members of the public.”1 The courts have not definitively interpreted the “freely accessible” requirement. The California Attorney General has interpreted this provision to require posting in a location open and accessible to the public 24 hours a day during the 72-hour period, but any of the 72 hours may fall on a weekend.2 This provision may be satisfied by posting on a touch screen electronic kiosk accessible without charge to the public 24 hours a day during the 72-hour period.3 While posting an agenda on an agency’s internet website will not, by itself, satisfy the “freely accessible” requirement since there is no universal access to the internet, an agency has a supplemental obligation to post the agenda on its website if (1) the local agency has a website and (2) the legislative body whose meeting is the subject of the agenda is either (a) a governing body or (b) has members that are compensated, with one or more members that are also members of a governing body.4
Q. May the meeting of a governing body go forward if its agenda was either inadvertently not posted on the city’s website or if the website was not operational during part or all of the 72-hour period preceding the meeting?
A. At a minimum, the Brown Act calls for “substantial compliance” with all agenda posting requirements, including posting to the agency website.5 Should website technical difficulties arise, seek a legal opinion from your agency attorney. The California Attorney General has opined that technical difficulties that cause the website agenda to become inaccessible for a portion of the 72 hours preceding a meeting do not automatically or inevitably lead to a Brown Act violation, provided the agency can demonstrate substantial compliance.6 This inquiry requires a fact-specific examination of whether the agency or its legislative body made “reasonably effective efforts to notify interested persons of a public meeting” through online posting and other available means.7 The Attorney General’s opinion suggests that this examination would include an evaluation of how long a technical problem persisted, the efforts made to correct the problem or otherwise ensure that the public was informed, and the actual effect the problem had on public 258
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awareness, among other factors.8 For these reasons, obvious website technical difficulties might not require cancellation of a meeting, provided that the agency meets all other Brown Act posting requirements and the agenda is available on the website once the technical difficulties are resolved.
The agenda must state the meeting time and place and must contain “a brief general description of each item of business to be transacted or discussed at the meeting, including items to be discussed in closed session.”9 For a discussion of descriptions for open and closed-session agenda items, see chapter 5. Special care should be made to describe on the agenda each distinct action to be taken by the legislative body, while an overbroad description of a “project” must be avoided if the “project” is actually a set of distinct actions, in which case each action must be listed separately on the agenda.10 For example, the listing of an "initiative measure” alone on an agenda was found insufficient where the agency was also deciding whether to accept a gift from the measure proponent to pay for the election.11 Q. The agenda for a regular meeting contains the following items of business:
• Consideration of a report regarding traffic on Eighth Street. • Consideration of a contract with ABC Consulting.
Are these descriptions adequate?
A. If the first is, it is barely adequate. A better description would provide the reader with some idea of what the report is about and what is being recommended. The second is not adequate. A better description might read, “Consideration of a contract with ABC Consulting in the amount of $50,000 for traffic engineering services regarding traffic on Eighth Street.”
Q. The agenda includes an item entitled City Manager’s Report, during which time the city manager provides a brief report on notable topics of interest, none of which is listed on the agenda.
Is this permissible?
A. Yes, as long as it does not result in extended discussion or action by the body.
A brief general description may not be sufficient for closed-session agenda items. The Brown Act provides safe harbor language for the various types of permissible closed sessions.12 Substantial compliance with the safe harbor language is recommended to protect legislative bodies and elected officials from legal challenges.
Mailed agenda upon written request
The legislative body, or its designee, must mail a copy of the agenda or, if requested, the entire agenda packet, to any person who has filed a written request for such materials. These copies shall be mailed at the time the agenda is posted or upon distribution to all, or a majority of all, of the members of the legislative body, whichever occurs first. If the local agency has an internet website, this requirement can be satisfied by emailing a copy of, or website link to, the agenda or agenda packet if the person making the request asks for it to be emailed. Further, if requested, these materials must be made available in appropriate alternative formats to persons with disabilities.
PRACTICE TIP: Putting together a
meeting agenda requires careful
thought.
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A request for notice is valid for one calendar year and renewal requests must be filed following January 1 of each year. The legislative body may establish a fee to recover the cost of providing the service. Failure of the requesting person to receive the agenda does not constitute grounds for invalidation of actions taken at the meeting.13
Notice requirements for special meetings
There is no express agenda requirement for special meetings, but the notice of the special meeting effectively serves as the agenda and limits the business that may be transacted or discussed. Written notice must be sent to each member of the legislative body (unless waived in writing by that member) and to each local newspaper of general circulation and each radio and television station that has requested such notice in writing. This notice must be delivered at least 24 hours before the time of the meeting by personal delivery or any other means that ensures receipt.
The notice must state the time and place of the meeting as well as all business to be transacted or discussed. It is recommended that the business to be transacted or discussed be described in the same manner that an item for a regular meeting would be described on the agenda, that is, with a brief general description. Some items must appear on a regular, not special, meeting agenda (e.g., general law city adoption of an ordinance or consideration of local agency executive compensation).14 As noted above, closed session items should be described in accordance with the Brown Act’s safe harbor provisions to protect legislative bodies and elected officials from challenges of noncompliance with notice requirements.
The special meeting notice must also be posted at least 24 hours prior to the special meeting using the same methods as posting an agenda for a regular meeting: at a site that is freely accessible to the public, and on the agency’s website if (1) the local agency has a website and (2) the legislative body whose meeting is the subject of the agenda is either (a) a governing body or (b) has members that are compensated, with one or more members that are also members of a governing body.15
Notices and agendas for adjourned and continued meetings and hearings A regular or special meeting can be adjourned and re-adjourned to a time and place specified in the order of adjournment.16 If no time is stated, the meeting is continued to the hour for regular meetings. Whoever is present (even if they are less than a quorum) may so adjourn a meeting; if no member of the legislative body is present, the clerk or secretary may adjourn the meeting.
If a meeting is adjourned for less than five calendar days, no new agenda need be posted so long as a new item of business is not introduced.17 A copy of the order of adjournment must be posted within 24 hours after the adjournment, at or near the door of the place where the meeting was held.
A hearing can be continued to a subsequent meeting. The process is the same as for continuing adjourned meetings, except that if the hearing is continued to a time less than 24 hours away, a copy of the order or notice of continuance must be posted immediately following the meeting.18 260
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Notice requirements for emergency meetings
The special meeting notice provisions apply to emergency meetings, except for the 24-hour notice.19 News media that have requested written notice of special meetings must be notified by telephone at least one hour in advance of an emergency meeting, and all telephone numbers provided in that written request must be tried. If telephones are not working, the notice requirements are deemed waived. However, the news media must be notified as soon as possible of the meeting and any action taken.
News media may make a practice of having written requests on file for notification of special or emergency meetings. Absent such a request, a local agency has no legal obligation to notify news media of special or emergency meetings — although notification may be advisable in any event to avoid controversy.
Notice of compensation for simultaneous or serial meetings A legislative body that has convened a meeting and whose membership constitutes a quorum of another legislative body, may convene a simultaneous or serial meeting of the other legislative body only after a clerk or member of the convened legislative body orally announces (1) the amount of compensation or stipend, if any, that each member will be entitled to receive as a result of convening the meeting of the other legislative body; and (2) that the compensation or stipend is provided as a result of convening the meeting of that body.20 No oral disclosure of the amount of the compensation is required if the entire amount of such compensation is prescribed by statute and no additional compensation has been authorized by the local agency. Further, no disclosure is required with respect to reimbursements for actual and necessary expenses incurred in the performance of the member’s official duties, such as for travel, meals, and lodging.
Educational agency meetings
The Education Code contains some special agenda and special meeting provisions.21 However, they are generally consistent with the Brown Act. An item is probably void if not posted.22 A school district board must also adopt regulations to make sure the public can place matters affecting the district’s business on meeting agendas and can address the board on those items.23
Notice requirements for tax or assessment meetings and hearings The Brown Act prescribes specific procedures for adoption by a city, county, special district, or joint powers authority of any new or increased tax or assessment imposed on businesses.24 Although written broadly, these Brown Act provisions do not apply to new or increased real property taxes or assessments, as those are governed by the California Constitution, Article XIIIC or XIIID, enacted by Proposition 218. At least one public meeting must be held to allow public testimony on the tax or assessment. In addition, there must also be at least 45 days notice of a public hearing at which the legislative body proposes to enact or increase the tax or assessment. Notice of the public meeting and public hearing must be provided at the same time and in the same document. The public notice relating to general taxes must be provided by newspaper publication.