Arroyo Grande City Council
June 13, 2023

127
Project Number: 350-5794 Department: Public Works
Total Capital Cost: $400,000 Type: Drainage
Request description:

Capital Costs FY2025 FY2026 FY2027 FY2028 Total
7001 - Construction $100,000 $100,000 $100,000 $100,000 $400,000 7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $100,000 $100,000 $100,000 $100,000 $400,000
Funding Source FY2025 FY2026 FY2027 FY2028 Total
4924 - Drainage Fund $0
4950 - Sales Tax $100,000 $100,000 $100,000 $100,000 $400,000 4965 - ARPA $0
Total $100,000 $100,000 $100,000 $100,000 $400,000
Type of Project
Corrugated Metal Pipe (CMP) Investigation and Repair
Annual project to repair deteriorating corrugated metal pipes (CMP) throughout the City.

Additional Information
Renovation

128
Project Number: 350-5798 Department: Public Works
Total Capital Cost: $214,000 Type: Drainage
Request description:

Capital Costs FY2026 Total
7001 - Construction $214,000 $214,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $214,000 $214,000
Funding Source FY2026 Total
4924 - Drainage Fund $0
4950 - Sales Tax $214,000 $214,000
4965 - ARPA $0
Total $214,000 $214,000
Type of Project
Trash Capture Devices
Implementing trash capture devices as mandated by the MS4 Stormwater Permit required by the State.

Additional Information
New Construction

129
Project Number: 612-5817 Department: Public Works
Total Capital Cost: $282,000 Type: Sewer
Request description:

Capital Costs FY2024 Total
7001 - Construction $215,700 $215,700
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $19,000 $19,000
7301 - Contract Admin $19,000 $19,000
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $28,300 $28,300
7701 - Studies $0
Total $282,000 $282,000
Funding Source FY2024 Total
4825 - Developer $0.00
4930 - Sewer Fund $0.00
4931 - Sewer Facility $0.00
4965 - ARPA $282,000.00 $282,000.00
4499 - Other Gov Agencies $0.00
44XX - FEMA Reimbursement $0.00
44XX - CalOES Reimbursement $0.00
4950 - Sales Tax $0.00
Total $282,000.00 $282,000.00
Type of Project
Trenchless Sewer Rehabilitation - El Camino Real to West Branch Street Cured-in-place pipe rehabilitation along the entire length of the sections mentioned below to reduce infiltration, root intrusion, and maintenance requirements, as well as probability of failure.

Location
El Camino Real to West Branch Street (under Highway 101) Additional Information
Rehabilitation

130
Project Number: 612-58XX Department: Public Works
Total Capital Cost: $850,000 Type: Sewer
Request description:

Capital Costs FY2024 Total
7001 - Construction $850,000 $850,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $850,000 $850,000
Funding Source FY2024 Total
4825 - Developer $0
4930 - Sewer Fund $0
4931 - Sewer Facility $0
4965 - ARPA $0
4499 - Other Gov Agencies $0
44XX - FEMA Reimbursement $637,500 $637,500
44XX - CalOES Reimbursement $157,250 $157,250
4950 - Sales Tax $55,250 $55,250
Total $850,000 $850,000
Type of Project
Lift Station 3
The heavy rains in the Winter of 22/23 have caused erosion at the top of the bank of Arroyo Grande Creek at Lift Station # 3. There is concerns the heavy flow of storm water in the Creek may have eroded the bottom of the creek bank and exposed an existing sewer force main located in the flowline of the Creek. Repair the erosion at the top of the Creek Bank and make improvements to reduce the storm water flow over the creek bank. Investigate the condition of the bottom of the creek bank and the sewer force main to see if they are vulnerable to damage caused by future storm events.

Additional Information
Rehabilitation

131
Project Number: 612-58XX Department: Public Works
Total Capital Cost: $282,000 Type: Sewer
Request description:

Capital Costs FY2025 Total
7001 - Construction $208,900 $208,900
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $20,900 $20,900
7301 - Contract Admin $20,900 $20,900
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $31,300 $31,300
7701 - Studies $0
Total $282,000 $282,000
Funding Source FY2025 Total
4825 - Developer $0
4930 - Sewer Fund $282,000 $282,000
4931 - Sewer Facility $0
4965 - ARPA $0
4499 - Other Gov Agencies $0
44XX - FEMA Reimbursement $0
44XX - CalOES Reimbursement $0
4950 - Sales Tax $0
Total $282,000 $282,000
Type of Project
Trenchless Sewer Rehabilitation - Pilgrim Way, Orchard Avenue, West Cherry Avenue and California Street Cured-in-place pipe rehabilitation along the entire length of the sections mentioned below to reduce infiltration, root intrusion, and maintenance requirements, as well as probability of failure.

Location
Pilgrim Way and Orchard Avenue
West Cherry Avenue to US-101
California Street and West Cherry Avenue
Additional Information
Rehabilitation

132
Project Number: 612-5854 Department: Public Works
Total Capital Cost: $100,000 Type: Sewer
Request description:

Capital Costs FY2026 Total
7001 - Construction $0
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $100,000 $100,000
Total $100,000 $100,000
Funding Source FY2026 Total
4825 - Developer $0
4930 - Sewer Fund $100,000 $100,000
4931 - Sewer Facility $0
4965 - ARPA $0
4499 - Other Gov Agencies $0
44XX - FEMA Reimbursement $0
44XX - CalOES Reimbursement $0
4950 - Sales Tax $0
Total $100,000 $100,000
Type of Project
Wastewater Master Plan Update
Ten year update to the 2012 Wastewater System Master Plan and computer model to reflect subsequent growth/changes in the City’s General Plan, subsequent wastewater system improvements, and changes in wastewater flow patterns.

Additional Information
Study

133
Project Number: 612-5849 Department: Public Works
Total Capital Cost: $300,000 Type: Sewer
Request description:

Capital Costs FY2026 FY2027 FY2028 Total
7001 - Construction $100,000 $100,000 $100,000 $300,000 7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $100,000 $100,000 $100,000 $300,000
Funding Source FY2026 FY2027 FY2028 Total
4825 - Developer $0
4930 - Sewer Fund $100,000 $100,000 $100,000 $300,000
4931 - Sewer Facility $0
4965 - ARPA $0
4499 - Other Gov Agencies $0
44XX - FEMA Reimbursement $0
44XX - CalOES Reimbursement $0
4950 - Sales Tax $0
Total $100,000 $100,000 $100,000 $300,000
Type of Project
Maintenance Hole Rehabilitation
Rehabilitate existing sanitary sewer manholes with an epoxy liner Additional Information
Replacement

134
Project Number: 612-58XX Department: Public Works
Total Capital Cost: $175,000 Type: Sewer
Request description:

Capital Costs FY2026 Total
7001 - Construction $175,000 $175,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $175,000 $175,000
Funding Source FY2026 Total
4825 - Developer $0
4930 - Sewer Fund $175,000 $175,000
4931 - Sewer Facility $0
4965 - ARPA $0
4499 - Other Gov Agencies $0
44XX - FEMA Reimbursement $0
44XX - CalOES Reimbursement $0
4950 - Sales Tax $0
Total $175,000 $175,000
Type of Project
Trenchless Sewer Rehabilitation - South Alpine and Ash St Cured-in-place pipe rehabilitation along the entire length of the sections mentioned below to reduce infiltration, root intrusion, and maintenance requirements, as well as probability of failure.

Location
South Alpine Street
Ash Street
Additional Information
Replacement

135
Project Number: 612-58XX Department: Public Works
Total Capital Cost: $300,000 Type: Sewer
Request description:

Capital Costs FY2027 Total
7001 - Construction $300,000 $300,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $300,000 $300,000
Funding Source FY2027 Total
4825 - Developer $0
4930 - Sewer Fund $300,000 $300,000
4931 - Sewer Facility $0
4965 - ARPA $0
4499 - Other Gov Agencies $0
44XX - FEMA Reimbursement $0
44XX - CalOES Reimbursement $0
4950 - Sales Tax $0
Total $300,000 $300,000
Type of Project
Trenchless Sewer Rehabilitation - Alder and Cameron Court to Victorian Way Cured-in-place pipe rehabilitation along the entire length of the sections mentioned below to reduce infiltration, root intrusion, and maintenance requirements, as well as probability of failure.

Location
Alder and Cameron Court to Victorian Way
Additional Information
Rehabilitation

136
Project Number: 612-5826 Department: Public Works
Total Capital Cost: $132,200 Type: Sewer
Request description:

Capital Costs FY2028 Total
7001 - Construction $132,200 $132,200
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $132,200 $132,200
Funding Source FY2028 Total
4825 - Developer $0
4930 - Sewer Fund $132,200 $132,200
4931 - Sewer Facility $0
4965 - ARPA $0
4499 - Other Gov Agencies $0
44XX - FEMA Reimbursement $0
44XX - CalOES Reimbursement $0
4950 - Sales Tax $0
Total $132,200 $132,200
Type of Project
Trenchless Sewer Rehabilitation - Woodland Drive
Cured-in-place pipe rehabilitation along the entire length of the sections mentioned below to reduce infiltration, root intrusion, and maintenance requirements, as well as probability of failure.

Location
Woodland Drive

Additional Information
Rehabilitation

137
Project Number: 640-5973 Department: Public Works
Total Capital Cost: $43,800 Type: Water
Request description:

Capital Costs FY2024 Total
7001 - Construction $43,800 $43,800
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $43,800 $43,800
Funding Source FY2024 Total
4816 - Other Financing $0
4940 - Water Fund $43,800 $43,800
4942 - Water Facility $0
4943 - Water Availability $0
4965 - ARPA $0
Total $43,800 $43,800
Type of Project
Phased Main Replacement - Highway 101 Crossing Upgrade, El Camino Real to West Branch Street Upgrade the existing 8-inch cast iron pipe to an 8-inch high density polyethylene (HDPE) pipe under Highway 101 from El Camino Real to West Branch Street.

Location
Highway 101-El Camino Real to West Branch Street

Additional Information
Replacement

138
Project Number: 640-5953 Department: Public Works
Total Capital Cost: $330,000 Type: Water
Request description:

Capital Costs FY2025 Total
7001 - Construction $330,000 $330,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $330,000 $330,000
Funding Source FY2025 Total
4816 - Other Financing $0
4940 - Water Fund $330,000 $330,000
4942 - Water Facility $0
4943 - Water Availability $0
4965 - ARPA $0
Total $330,000 $330,000
Type of Project
SCADA Software/Electronics Design and Upgrade
Provide two new redundant workstations, to run a new Windows?based SCADA software package to replace the existing SCADA desktop computer to increase the reliability of the City’s SCADA system. Water System Master Plan Project B-3.

Additional Information
Equipment

139
Project Number: 640-59XX Department: Public Works
Total Capital Cost: $100,000 Type: Water
Request description:

Capital Costs FY2025 Total
7001 - Construction $100,000 $100,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $100,000 $100,000
Funding Source FY2025 Total
4816 - Other Financing $0
4940 - Water Fund $100,000 $100,000
4942 - Water Facility $0
4943 - Water Availability $0
4965 - ARPA $0
Total $100,000 $100,000
Type of Project
Reservoir No. 5 Redundancy Interconnect
The water distribution system for Reservoir No. 5 pressure zone has only one watermain that can provide water to the pressure zone. This project will provide a redundant interconnect to assure the zone has water delivery from Reservoir No. 5 with the watermain off. The project will interconnect the watermain from Los Ciervos to Andre Drive.

Additional Information
New Construction

140
Project Number: 640-59XX Department: Public Works
Total Capital Cost: $100,000 Type: Water
Request description:

Capital Costs FY2026 Total
7001 - Construction $0
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $100,000 $100,000
Total $100,000 $100,000
Funding Source FY2026 Total
4816 - Other Financing $0
4940 - Water Fund $100,000 $100,000
4942 - Water Facility $0
4943 - Water Availability $0
4965 - ARPA $0
Total $100,000 $100,000
Type of Project
Water Master Plan Update
Ten year update to the 2012 Water System Master Plan and computer model to reflect subsequent growth/changes in the City’s General Plan, subsequent water system improvements, and changes in water demand.

Additional Information
Study

141
Project Number: 640-59XX Department: Public Works
Total Capital Cost: $1,000,000 Type: Water
Request description:

Capital Costs FY2026 FY2027 Total
7001 - Construction $125,000 $875,000 $1,000,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $125,000 $875,000 $1,000,000
Funding Source FY2026 FY2027 Total
4816 - Other Financing $0
4940 - Water Fund $125,000 $875,000 $1,000,000
4942 - Water Facility $0
4943 - Water Availability $0
4965 - ARPA $0
Total $125,000 $875,000 $1,000,000
Type of Project
Phased Main Replacement – Cornwall Street
This project will replace the existing 8-inch cast iron pipes with new 8-inch PVC pipes in Cornwall Street between North Halcyon Road to just west of El Camino Real.

Location
Cornwall St from Barnett St to Halcyon Rd
Additional Information
Replacement

142
Project Number: 640-5911 Department: Public Works
Total Capital Cost: $773,500 Type: Water
Request description:

Capital Costs FY2027 Total
7001 - Construction $572,900 $572,900
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $57,300 $57,300
7301 - Contract Admin $57,300 $57,300
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $86,000 $86,000
7701 - Studies $0
Total $773,500 $773,500
Funding Source FY2027 Total
4816 - Other Financing $0
4940 - Water Fund $673,500 $673,500
4942 - Water Facility $100,000 $100,000
4943 - Water Availability $0
4965 - ARPA $0
Total $773,500 $773,500
Type of Project
Phased Mains Replacement - North Halcyon to El Camino
This project will replace the existing 8-inch cast iron water main with new 8-inch PVC pipe along North Halcyon Road to El Camino.

Location
North Halcyon Road to El Camino
Additional Information
Replacement

143
Project Number: 640-5948 Department: Public Works
Total Capital Cost: $500,000 Type: Water
Request description:

Capital Costs FY2027 Total
7001 - Construction $500,000 $500,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $500,000 $500,000
Funding Source FY2027 Total
4816 - Other Financing $0
4940 - Water Fund $500,000 $500,000
4942 - Water Facility $0
4943 - Water Availability $0
4965 - ARPA $0
Total $500,000 $500,000
Type of Project
Reservoir No. 4 Exterior Coating
Sand blast, prime and re-coat Reservoir No. 4 exterior. The tank was built in 1983 and has never been painted since it was originally built.

Additional Information
Renovation

144
Project Number: 640-59XX Department: Public Works
Total Capital Cost: $300,000 Type: Water
Request description:

Capital Costs FY2028 Total
7001 - Construction $300,000 $300,000
7002 - PW Construction $0
7005 - PW Construction - Concrete $0
7006 - PW Construction - Asphalt $0
7201 - Construction Contingencies $0
7301 - Contract Admin $0
7302 - Appraisals $0
7303 - Land Acquisition $0
7501 - Design & Survey $0
7701 - Studies $0
Total $300,000 $300,000
Funding Source FY2028 Total
4816 - Other Financing $0
4940 - Water Fund $300,000 $300,000
4942 - Water Facility $0
4943 - Water Availability $0
4965 - ARPA $0
Total $300,000 $300,000
Type of Project
Miller Way Booster Zone Upgrade
Complete upgrade on the Miller Way Booster Station, including a new pump building (or enclosed package pump station), new pumps and motors (2 x 5-HP), and new bladder tanks. The upgraded booster station will have a design capacity of 75-gpm. This will increase the reliability of the water supply to the Miller Way zone and will improve water service pressure. In addition, this is expected to decrease maintenance costs and increase efficiency.

Additional Information
Replacement

145
Appendix A

146

CITY OF ARROYO GRANDE

ORGANIZATIONAL CHART

147
Community Profile

INTRODUCTION
The City of Arroyo Grande is located five miles inland from the central California coastline.

Incorporated in 1911, the City contains acres of agriculturally productive land in a valley created by the Arroyo Grande Creek. The fertile soil produces several crop harvests annually, including celery, lettuce, and strawberries. There are several wineries in the vicinity, designating the area as the Arroyo Grande wine region.

The City, locally known as one of the “Five Cities”, adjoins Pismo Beach and Grover Beach, and is neighbor to Avila Beach and Shell Beach. The economy of the five cities depends heavily on tourists and retail sales.

Many of the residents of Arroyo Grande commute to work in neighboring communities. Others are employed in the service industries of Arroyo Grande, such as retail, education, and health care. Pacific Gas & Electric and its Diablo Canyon Nuclear Power Plant is a significant employer in the region. A small quantity of manufacturing is located within the City.

The heart of the City is the Village of Arroyo
Grande, a unique section of the community
from which the modern City derived its roots.

Antique shops, an ice cream parlor, and turn
of the century architecture are reminiscent
of an earlier age.

Within the Village is a swinging bridge that was originally constructed in 1875 to connect land divided by the Arroyo Grande Creek. The 171-foot bridge is the only one of its kind in California. When the bridge was donated to the City of Arroyo Grande in 1911, the City assumed responsibility for maintenance and care.

148
Community Profile
City Recreation Areas & Programs
The City has several parks with picnic, barbecue, and
playground areas. Strother Community Park, located along the bank of the Arroyo Grande Creek, is ideal for reunions, picnics, and barbecues. Elm Street Park has volleyball
standards and playground equipment for all ages. The
Heritage Square Park, connected to the Village area by the historical Swinging Bridge, is a favorite place for tourists and locals to enjoy lunchtime.

The Hart-Collett Memorial Park, the Terra De Oro Park, and the Kiwanis Park are small parks with picnic tables and benches only. Rancho Grande Park is also ideal for family gatherings or special celebrations.

The twenty-six acre Soto Sports Complex serves the Five Cities region by providing four lighted tennis courts, a Little League field, a lighted Babe Ruth field, four lighted softball fields, and two unlit ball fields. The fields are converted to soccer and football use in the fall.

The James Way Oak Habitat and Wildlife Preserve
has equestrian and jogging/walking trails for public
use. The habitat, winding along a hillside in an oak
preserve, has an abundant array of wildlife.

The City offers a wide variety of recreational
opportunities for local residents and visitors. From
youth and adult sports leagues, child care
programs, and special events to classes for seniors
and summer youth camps, there are programs
available for nearly every age.

149
Population Overview

TOTAL POPULATION
18,441 2.3%
vs. 2019

GROWTH RANK
185 out of 493
Municipalities in California

DAYTIME POPULATION
17,545
Daytime population represents the effect of persons coming into or leaving a community for work, entertainment, shopping, etc. during the typical workday. An increased daytime population puts greater demand on host community services which directly impacts operational costs. * Data Source: American Community Survey 5-year estimates

POPULATION BY AGE GROUP
Aging affects the needs and lifestyle choices of residents. Municipalities must adjust and plan services accordingly. * Data Source: American Community Survey 5-year estimates * Data Source: U.S. Census Bureau American Community Survey 5-year Data and the 2020, 2010, 2000, and 1990 Decennial Censuses 1990
1991
19921993
1994
1995
1996
1997
19981999
2000
2001
2002
2003
2004
2005
2006
2007
20082009
2010
2011
20122013
2014
2015
2016
2017
20182019
2020
14k
15k
16k
17k
18k
19k
<5 5-9 10-14 15-19 20-24 25-34 35-44 45-54 55-59 60-64 65-74 75-84 >85

150
Household Analysis

TOTAL HOUSEHOLDS
7,026
Municipalities must consider the dynamics of household types to plan for and provide services effectively. Household type also has a general correlation to income levels which affect the municipal tax base.
* Data Source: American Community Survey 5-year estimates 8%
higher than state average
Family Households
54%
14%
higher than state average
Married Couples
57%
12%
higher than state average
Singles
27%
73%
higher than state average
Senior Living Alone
23%

151
Economic Analysis
Household income is a key data point in evaluating a community’s wealth and spending power. Pay levels and earnings typically vary by geographic regions and should be looked at in context of the overall cost of living.

HOUSEHOLD INCOME
Above $200,000
9%
34%
lower than state average
Median Income
$88,068
12%
higher than state average
Below $25,000
12%
19%
lower than state average
* Data Source: American Community Survey 5-year estimates Over $200,000
$150,000 to $200,000
$125,000 to $150,000
$100,000 to $125,000
$75,000 to $100,000
$50,000 to $75,000
$25,000 to $50,000
B elow $25,000

152
Housing Overview
2020 MEDIAN HOME VALUE
$610,000
* Data Source: 2020 US Census Bureau
(http://www.census.gov/data/developers/data-sets.html), American Community Survey. Home value data includes all types of owner-occupied housing.

HOME VALUE DISTRIBUTION
* Data Source: 2020 US Census Bureau
(http://www.census.gov/data/developers/data-sets.html), American Community Survey. Home value data includes all types of owner-occupied housing.

HOME OWNERS VS RENTERS
Arroyo Grande
34%
Rent
66%
Own
State Avg.
45%
Rent
55%
Own
* Data Source: 2020 US Census Bureau
(http://www.census.gov/data/developers/datasets.html), American Community Survey. Home value data includes all types of owner-occupied housing.
2009
2010
2011
20122013
2014
201520162017
2018
2019
2020
400k
450k
500k
550k
600k
650k
> $1,000,000
$750,000 to $999,999
$500,000 to $749,999
$400,000 to $499,999
$300,000 to $399,999
$250,000 to $299,999
$200,000 to $249,999
$150,000 to $199,999
$100,000 to $149,999
$50,000 to $99,999
< $49,999

153
Fiscal Policy
Adopted by the City Council: September 5, 1995
Revised: June 28, 2011
The budget document is a policy statement and financial plan that allocates City resources such as personnel, materials, and equipment in tangible ways to achieve the general goal of a balanced community. It is, therefore, prudent for the City Council to have adopted a Fiscal Policy to guide staff through the budget-development process. The Fiscal Policy is a guideline, not an absolute. The Policy describes goals the Council seeks to achieve to secure fiscal solvency, superior levels of customer service, and maximum cost efficiency. The Policy components are as follows:

RESERVES
• Establish and maintain a Fund Balance reserve goal of 20% of expenditures with a minimum of 15% in the General Fund.
• Maintain a minimum of 5% of the General Fund budget as a Contingency Reserve. • Contribute 10% of annual appropriations to the improvement of Infrastructure.

FISCAL MANAGEMENT
• Maintain safety and liquidity while maximizing investment revenue. • Utilize grants and subsidies from other sources when possible and cost-effective. • Charge fees for services that reflect the cost of providing such services. • Review fees annually, establish actual costs, adjust existing fees and establish new fees as needed.
• Recover costs when possible for facility use, planning and building services, code enforcement, community events and administrative costs.
• Develop short and long-term financial plans.
• Develop fiscal models to reflect development and planning policies to ensure resources are adequate to provide service needs.
• Maintain a PERS Retirement Fund in which the City funds retirement costs on an annual basis at no lower than the projected long-term average rates in order to eliminate the fluctuations in PERS costs and provide long-term stability.

NEW SERVICES
Add new services only when a need has been identified and when adequate staffing and funding sources have been provided.

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PUBLIC SAFETY
Provide funding to maintain the safety of the citizens of Arroyo Grande at a level that ensures that Arroyo Grande maintains its position as one of the safest cities in San Luis Obispo County.

WATER, LOPEZ AND SEWER FUNDS
Maintain reserve funds equal to 90 days of operating expenses plus $500,000 and one year of debt service.

FACILITIES
• Plan for new facilities only if operations and maintenance costs for those new facilities will not negatively impact the operating budget.
• Provide adequate routine maintenance each year to avoid the cost of deferred maintenance.

OPERATIONAL EFFICIENCIES
• Provide City services in the most cost-effective manner. • Provide staffing levels that allow employees to respond promptly to service requests from the public.
• Utilize consultants and temporary help for special projects or peak workload periods. • Utilize community expertise on a voluntary basis as appropriate. • Ensure that fee-supported services are staffed appropriately to render the services for which customers have paid.
• Work through regional agencies to share costs for local and mandated programs whenever possible.

EMPLOYEE DEVELOPMENT
Attract and retain competent employees for the City work force by compensating employees fairly, providing adequate training opportunities, ensuring safe working conditions, and maintaining a professional work environment.

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Fiscal Policy

ECONOMIC DEVELOPMENT
• Promote a mix of businesses that contributes to a balanced community, develop programs to enhance and retain existing businesses, and pursue new developments and businesses that add to but do not detract from the City’s economic base.
• Maximize opportunities for the existing business community, thereby increasing existing sources of revenue to meet the increasing demands for service.

RETIREE MEDICAL
Pre-fund retiree medical benefit costs.

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Significant Accounting Policies

REPORTING ENTITY
The City of Arroyo Grande was incorporated on July 10, 1911 under the laws of the State of California and enjoys all the rights and privileges applicable to a General Law City. An elected five-member board governs the City. The City operates under a Council-Manager form of government, and currently provides a wide variety of services to its citizens, including police, public services, community development, general administrative and other services.

Description of Funds
Fund Accounting Systems
The City uses funds and account groups to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain City functions or activities.

A fund is an accounting entity with a self-balancing set of accounts established to record the financial position and results of operations of a specific governmental activity. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect net expendable available resources. The City maintains the following fund types and account groups:

Types of Funds
Governmental Fund Types
General Fund – is the general operating fund of the City and accounts for all unrestricted financial resources except those required to be accounted for in another fund.

Special Revenue Funds – to account for the proceeds of specific revenue sources (other than special assessments, expendable trusts, or capital projects) that are restricted by law or administrative action to expenditures for specific purposes.

Debt Service Funds – to account for the accumulation of resources for and the payment of, interest and principal on general long-term debt and related costs. The City currently does not have general long term debt that would be obligated to use a debt service fund.

Capital Project Funds – to account for financial resources segregated for the acquisition of major capital projects or facilities (other than those financed by proprietary fund types).

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Significant Accounting Policies
Proprietary Fund Types
Enterprise Funds – to account for operations in a manner similar to private business enterprises where the intent is to have the costs (expenses, including depreciation) of providing goods or services to the general public to be financed or recovered primarily through user charges.

Fiduciary Fund Types
Agency Funds – to account for assets held by the City as trustee or agent for individuals, private organizations, or other governmental units, and/or other funds. These funds are custodial in nature (assets correspond with liabilities) and do not involve measurement of results of operations.

Basis of Accounting
Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Specifically, it relates to the timing of the measurements made, regardless of the nature of the measurement. All governmental funds and Agency funds are accounted for using the modified accrual basis of accounting. Revenues are recognized when they become measurable and available as net current assets. In those funds where revenue is recognized on a modified accrual basis the following revenues may be accrued: property and sales taxes, revenue from the use of money and property, interfund transfers, unbilled service receivables and intergovernmental revenue. Licenses, permits, fines and forfeitures and similar items are, for the most part, not accrued and consequently are not recorded until received. Agency funds are purely custodial (assets equal liabilities) and thus do not involve measurement of results of operations. The assets and liabilities are accounted for on a modified accrual basis with the exception of the City’s Deferred Compensation Plan, which is accounted for on a market value basis in accordance with Statement No. 2 of the Governmental Accounting Standards Board (GASB).

Property tax revenue is recognized in the fiscal year for which the taxes have been levied providing they become available, in accordance with National Council of Governmental Accounting GASB 33. In this context, available means when receivable and due, when payment is expected within the current period, or within sixty (60) days of year end, and thus available to pay debts of the current period.

Grants, entitlements, or shared revenues recorded in governmental funds are recognized as revenue in the accounting period when they become susceptible to accrual, i.e. both measurable and available (modified accrual basis).

Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. Principal and interest on general long-term debt is recognized when due.

All proprietary funds are accounted for using the accrual basis of accounting. Their revenues are recognized when they are earned and become measurable, expenses are recognized when they are incurred if measurable.

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Significant Accounting Policies
The City reports deferred revenue on its combined balance sheet. Deferred revenues arise when potential revenue does not meet both the “measurable” and “available” criteria for recognition in the current period. Deferred revenues also arise when the City receives resources before it has a legal claim to them, as when grant monies are received prior to the incurrence of qualifying expenditures. In subsequent periods, when both revenue recognition criteria are met, or when the City has a legal claim to the resources, the liability for deferred revenue is removed from the combined balance sheet and revenue is recognized.

Budgetary Process
The City uses the following procedures in establishing the budgetary data reflected in the financial statements: after January 1, Department Directors prepare estimates for required appropriations for the fiscal year commencing the following July 1. The departmental estimates are presented to the City Manager for review. A Preliminary Budget is prepared that includes estimated expenditures and forecasted revenues for the fiscal year. Prior to July 1, the City Manager submits a Preliminary Budget for the upcoming fiscal year to the City Council. The Preliminary Budget includes a summary of the proposed expenditures and financial resources of the City, as well as historical data for preceding fiscal periods. Public meetings are conducted to obtain citizens’ comments. The City Council adopts the budget by June 30. Budgets are legally adopted for the general, special revenue, enterprise funds, agency funds and all capital projects programs during the fiscal year ended June 30. The appropriated budget covers substantially all City expenditures. All appropriated amounts shown are as originally adopted or as amended by the City Council. During the year, supplementary appropriations may be approved. Unexpended appropriations lapse at the year-end, unless approved for carryover by the City Manager to address multi-year projects or initiatives.

Department Directors are authorized to transfer budgeted amounts within their departments, within the same fund, with the approval of the City Manager. The City Manager has authority to make transfers of appropriations between departments, provided those changes do not impact budgeted year-end fund balances. Only the City Council may authorize transfers of appropriations between funds. Formal budgetary integration is employed as a management control device during the fiscal year for all governmental funds.

Encumbrances
Encumbrances represent commitments related to unperformed contracts for goods or services.

Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of resources are recorded to reserve that portion of the applicable appropriation, is utilized in all funds. Encumbrances outstanding at year-end are reported as reservations of fund balances and do not constitute expenditures or liabilities because the commitments will be honored during the subsequent year. Amounts encumbered at year-end are reappropriated in the following year.

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Significant Accounting Policies
Budget Basis of Accounting
Budgets for governmental funds are adopted on a basis consistent with generally accepted accounting principles (GAAP).

Cash and Investments
Cash includes amounts in demand deposits. Investments, including accrued interest, are stated at fair market value.

Interfund Transactions
During the course of operations, numerous transactions occur between individual funds for goods provided or services rendered. These receivables and payables are classified as “due from other funds” or “due to other funds” on the balance sheet.

Inventories
Inventories of materials and supplies are carried at cost on a first-in, first-out basis. The City uses the consumption method for accounting for inventories.

Fixed Assets
All purchased fixed assets are valued at cost where historical records are available, and at an estimated historical cost where no historical records exist. Donated fixed assets are valued at their estimated fair market value on the date received.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Improvements are capitalized and depreciated, as applicable, over the remaining useful lives of the related fixed assets.

In accordance with GASB 34, all Public domain (“infrastructure”) fixed assets are now capitalized.

Examples of infrastructure assets are: roads, bridges, curbs and gutters, streets and sidewalks, drainage and lighting systems.

Depreciation of fixed assets is computed using the straight-line method. The estimated useful lives are as follow:

Buildings and structures 40 – 55 years
Machinery 3 – 10 years
Equipment 5 – 20 years
Compensated Absences
Vested or accumulated personal leave of employees, that is expected to be liquidated with expendable available financial resources, is reported as an expenditure and a fund liability of the governmental fund

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Significant Accounting Policies
that will pay it. Amounts of vested or accumulated personal leave not expected to be liquidated with expendable available financial resources are reported in the City’s financial statements as long-term debt. No expenditure is reported for those amounts. Vested or accumulated personal leave of proprietary funds is recorded as an expense and liability of those funds as the benefits accrue to employees.

Property Taxes
The San Luis Obispo County Assessor and Tax Collector perform the duties of assessing and collecting property tax, respectively. Tax levies cover the period from July 1 to June 30 of each year. All tax liens attach annually on the first day in March proceeding the fiscal year for which the taxes are levied. Taxes are levied on both real and personal property as of March 1.

Secured property taxes are levied against real property and are due and payable in two equal installments. The first installment is due on November 1 and becomes delinquent if not paid by December 10. The second installment is due on February 1 and becomes delinquent if not paid by April

10. Unsecured personal property taxes are due on July 1 each year. These taxes become delinquent if not paid by August 31.

Grants
Federal and state grant revenues are accrued to the extent expenditures are incurred. All such grants are subject to audit and adjustment by the grantor.

Long-term Obligations
Long-term debt is recognized as a liability of a governmental fund when due or when resources have been accumulated in the debt service fund for payment early in the following year. Other long-term obligations to be financed from expendable available financial resources are reported as a fund liability of a governmental fund. The remaining portion of such obligations is reported in the financial statements. Long-term liabilities to be financed from proprietary fund operations are accounted for in those funds.

Fund Equity
Contributed capital is recorded in proprietary funds that have received capital grants or contributions from developers, customers or other funds. These reserves represent those portions of fund equity not available for expenditure or that are legally segregated for a specific future use of financial resources.

Fund designations are established to indicate tentative plans for the use of current financial resources in the future.

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Guide to Funds by Number
010 General Fund –The primary operating fund of the City, which accounts for resources and services traditionally associated with government. The General Fund provides administrative, financial, police and fire protection, community development, parks and recreation, and public works services to the community and other funds. The General Fund accounts for revenues that have unrestricted uses and are not required legally or by contractual agreement to be accounted for in another fund. 210 Fire Protection Impact –This fund accounts for impact fees collected from developers for the expansion of the existing fire station in order to serve future development. 211 Public Access Television – This fund accounts for fees collected from Charter Communications that are restricted for support of public, education and government access programming and equipment.
212 Police Protection Impact –This fund accounts for impact fees collected from developers for the expansion of the existing police facility in order to serve future development. 213 Park Development – This fund accounts for the receipts of park-in-lieu fees (Quimby) and grant revenues that are used for construction, park acquisition, and development of park facilities. 214 Park Improvement – Impact fees that are collected for park improvements will be used to maintain the adopted level of service for neighborhood and community parks of 4.0 acres per thousand population. This fund accounts for the receipt of these monies. 215 Recreation Community Center – This fund accounts for impact fees collected for recreation facilities in order to maintain the adopted level of service of recreation/community center facilities of 542 square feet.
216 Gracelane Assessment District – Fund to account for revenues derived from annual assessments of properties within the District, which are used to pay the cost incurred by the City for landscape maintenance.
217 Landscape Maintenance District – This fund accounts for the landscape maintenance of parkways within two housing tracts. A special benefit assessment is levied on property owners to pay for landscape maintenance expenditures.
218 Local Use Tax Fund – Fund to account for the ½% local sales tax increase approved by the voters in November of 2006.
219 Parkside Assessment District –Fund to account for revenues derived from annual assessments of properties, which are used to pay the cost incurred by the City for landscape maintenance.

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Guide to Funds by Number
220 Street (Gas Tax) Fund – The fund that accounts for receipts and expenditures of money apportioned by the State under Streets and Highway Code sections. Gas tax revenues can only be used to construct and maintain streets and highways.
221 Traffic Congestion Relief Fund – This fund accounts for receipts and expenditures of money apportioned by the State under AB 2928 for street or road maintenance or reconstruction. 222 Traffic Signalization – This fund accounts for traffic signalization assessments levied against developments for the future cost of traffic signals. 223 Traffic Circulation – This fund accounts for developer traffic mitigation measure fees charged as a result of an environmental review.
224 Transportation Facility Impact – This fund accounts for developer impact fees (AB1600 fees) paid to protect the public health, safety, and welfare by maintaining the existing level of public services for existing and future residents within the City of Arroyo Grande. 225 Transportation Fund – The fund accounts for revenues from the Local Transportation Fund (LTF), the South County Transit (SCT), and a senior taxi program administered by SCT.

Expenditures are restricted to public transportation.
226 Water Neutralization Impact Fund – This fund accounts for mitigation fees collected from developers to neutralize projected water demand, of development projects, above historical usage amounts.
230 Construction Tax – The fund that accounts for the accumulation of tax revenues levied on construction of residential dwelling units, mobile home lots, and commercial buildings. Expenditures are restricted to public improvements, including but not limited to, facilities, fire stations, fire-fighting equipment, parks, street improvements, and equipment.
231 Drainage Facility – This fund accounts for development drainage fees restricted to improving drainage within the City.
232 In-lieu Affordable Housing – The fund accounts for monies paid by developers in meeting the City’s mandatory affordable housing requirements. 233 In-lieu Underground Utilities – The fund accounts for monies paid by developers in meeting the City’s underground utility requirements.
240 Arroyo Grande Tourism Marketing Improvement District Fund – The fund that accounts for assessments collected from lodging establishments, which are restricted for programs, projects and activities that benefit lodging businesses in the City.

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Guide to Funds by Number
241 Water Availability Fund – The fund that accounts for impact fees collected to mitigate future water requirements.
250 CDBG Grant Fund – The fund accounts for revenues and expenditures related to Community Development Block Grant Funds.
271 State COPS Block Grant Fund – The fund that accounts for the receipt of revenues from the State of California restricted to the purchase of police equipment and technology for crime prevention.
286 Successor Agency to the Former Redevelopment Agency Administration – Fund used to account for tax increment revenues to be used for Successor Agency administration and payment of the former Redevelopment Agency enforceable obligations. 287 Successor Agency to the Former Redevelopment Agency Housing Function – The fund accounting for tax increment revenues of the former Redevelopment Agency to be used for low and moderate housing within the City.
350 Capital Improvement Program – Fund established to account for transfers from other City funds and grant revenues to be used for infrastructure improvements within the City. The Program is divided into six project types – Miscellaneous Projects, Park Projects, Street Projects, Drainage Projects, Sewer Projects, and Water Projects.
612 Sewer Fund – Fund used to account for maintenance of sewer lines connecting City residents to the San Luis Obispo County Sanitation District sewer plant. Maintenance costs are funded by user charges.
634 Sewer Facility Fund – This fund accounts for the accumulation of sewer facility revenues to be used in capital improvement projects in the City. 640 Water Fund – Fund used to account for the operation of water utility service to the community. Revenues are received from fees for service. 641 Lopez Fund – The Lopez Fund is responsible for the purchase of water, debt servicing, and the maintenance and operation of Lopez Dam. User Fee charges for water availability and utility billing are the major revenue sources of this fund.
642 Water Facility Fund –Fund used to account for the accumulation of revenues from charges for current services to be used for future water infrastructure improvements. 751 Downtown Parking –Agency Fund collecting assessments from Village merchants for the maintenance of Village parking for the Downtown Village Merchants Association.

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Fund Structure
Governmental Fund Types
General Fund – is the general operating fund of the City and accounts for all unrestricted financial resources except those required to be accounted for in another fund.

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Fund Structure
Special Revenue Funds – to account for the proceeds of specific revenue sources (other than special assessments, expendable trusts, or capital projects) that are restricted by law or administrative action to expenditures for specific purposes.

Debt Service Funds – to account for the accumulation of resources for and the payment of, interest and principal on general long-term debt and related costs. The City currently does not have general long term debt that would be obligated to use a debt service fund.

Capital Project Funds – to account for financial resources segregated for the acquisition of major capital projects or facilities (other than those financed by proprietary fund types).

Proprietary Fund Types
Enterprise Funds – to account for operations in a manner similar to private business enterprises where the intent is to have the costs (expenses, including depreciation) of providing goods or services to the general public to be financed or recovered primarily through user charges.

Fiduciary Fund Types
Agency Funds – to account for assets held by the City as trustee or agent for individuals, private organizations, or other governmental units, and/or other funds. These funds are custodial in nature (assets correspond with liabilities) and do not involve measurement of results of operations.

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Budget Glossary
Account: A subdivision within a fund for the purpose of classifying transactions.

Account Number: A numeric identification of the account. Typically, a unique number or series of numbers. The City of Arroyo Grande’s number structure is comprised of three (3) fields of characters.

The first field is three (3) characters wide and identifies the various FUNDS within the account system.

The next field contains four (4) characters and identifies the PROGRAMS and/or DIVISIONS within the City. The final field contains four (4) characters and identifies the OBJECT CODE of the account number.

The combination of the three fields makes up the account number.

Accrual Basis or Accrual Method: Accounting method whereby income and expense items are recognized as they are earned or incurred, even though they may not have been received or actually paid in cash. The alternative is Cash Basis. The City of Arroyo Grande uses the method of “Modified Accrual” basis of accounting for governmental and agency funds. All proprietary funds are accounted for using the accrual basis of accounting.

ACFR: Annual Comprehensive Financial Report which is an audited and printed copy of the City’s financial statement at the end of a given fiscal year.

Actual: The recorded revenue or expenditure for a specific account number. The actual columns, referenced in this document, report the revenues or expenditures as audited by an independent auditor.

Adopted Budget: A budget which typically has been reviewed by the public and “Adopted” (approved) by the City Council prior to the start of the fiscal year. The adopted budget is the legal authority to expend money for specified purposes in the fiscal year time period.

AGPOA: Arroyo Grande Police Officers Association. This union represents sworn and non-sworn police employees working for the City.

AGTBID: Arroyo Grande Tourism Business Improvement District. Established in May 2013 by Ordinance, the district exists to provide projects, programs and activities that benefit lodging businesses located and operating with the boundaries of the City. Assessments are levied on all lodging businesses and are subject to annual review by the City Council in accordance with the requirements contained in the Parking and Business Improvement Area Law of 1989 (Streets and Highways Code Sections 36500 et seq.).

Appropriate: Set apart for, or assign to, a particular purpose or use.

Appropriated Expenditure: A budget amount set-aside for a specific acquisition or purpose.

Appropriation: An authorization by the City Council to make expenditures and to incur obligation for specific amounts and purposes. For most local governments, the adopted budget document is the source for all or most appropriations.

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Budget Glossary
Assessed Valuation: An official value established for real estate or other property as a basis for levying property taxes.

Assessments: Charges made to parties for actual services or benefits received.

Assets: Property owned by the City which has book or appraised monetary value.

Audit: A review of the accounting system and financial records to verify that government funds were spent and received in accordance with Generally Accepted Accounting Principles (GAAP) and in compliance with the legislative body’s appropriations.

Authorized Positions: Employee positions, which are authorized in the adopted budget, to be filled during the year.

Available (Undesignated) Fund Balance: Funds remaining from prior years, which are available for appropriation and expenditure in the current year.

Balance Sheet: A statement presenting the financial position of an entity or fund by disclosing the value of its assets, liabilities, and equities as of a specified date.

Balanced Budget: Budgeted resources, including revenue, transfers from other funds, and unallocated fund balance from previous years meet or exceed the budgeted use of resources, including expenditures and transfers to other funds.

Base Budget: The ongoing expense level necessary to maintain service levels previously authorized by the City Council.

Beginning Balance: Unencumbered resources available in a fund from the prior fiscal year after payment of prior fiscal year expenditures.

Bond: A written promise from a local government to repay a sum of money on a specific date at a specified interest rate. Bonds are most frequently used to finance capital improvement projects such as buildings, streets, and bridges.

Budget: A plan of financial operation, for a set time period, which identifies specific types and levels of services to be provided, proposed appropriations or expenses, and the recommended means of financing them.

Budget Amendments: The City Council has the sole responsibility for adopting the City’s budget, and may amend or supplement the budget at any time after adoption by majority vote. The City Manager and Administrative Services Director have joint authority to approve line item budgetary

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Budget Glossary
transfers between expenditure objects of the budget, as long as transfers do not affect ending fund balances.

Budgetary Basis: The basis of accounting used to estimate financing sources and uses in the budget.

Budget Message: The opening section of the budget, which provides the City Council and the public with a general summary of the most important aspects of the budget, changes from previous years, and presents recommendations made by the City Manager.

Budget Year: Is the FISCAL YEAR for which the budget is being considered.

Budgetary Unit: An organizational component budgeted separately, usually a department or a division.

Capital Expenditures: An acquisition or an improvement (as distinguished from a repair) that will have a life of more than one year.

Capital Improvement Budget: A financial plan or authorized expenditures for tangible, longterm construction of, or improvement to, public physical facilities.

Capital Improvement Program (CIP): A long-term plan for multi-year projects such as street or park improvements, building construction, and various kinds of major facility maintenance. The projects set out in the plan usually require funding beyond the one-year period of the annual budget and the plan details funding sources and expenditure amounts.

Capital Outlay: Expenditures that result in the acquisition of or addition to, fixed assets. A capital item is tangible, durable, and non-consumable, and has a useful life of more than one year.

Carryover: Unspent funds, either encumbered, reserved, or unobligated, brought forward from prior fiscal years.

Cash Basis: A basis of accounting in which transactions are recognized only when cash is increased or decreased.

Consumer Price Index (CPI): Measure of change in consumer prices as determined by a monthly survey of the U.S. Bureau of Labor Statistics. Many pension and employment contracts are tied to changes in consumer prices as protection against inflation and reduced purchasing power. Among the CPI components are the costs of housing, transportation, and electricity. Also known as the Cost-ofLiving Index.

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Budget Glossary
Contingency: A budgetary reserve set aside for emergencies or unforeseen expenditures not otherwise budgeted.

Contractual Services: Services rendered to a government by private firms, individuals, or other governmental agencies. Examples include maintenance agreements, professional contracts, and tree trimming agreements.

Debt Service: The City’s obligation to pay the principal and interest of all bonds and other debt instruments according to a pre-determined payment schedule.

Deficit: The excess of an entity’s liabilities over its assets or the excess of expenditures or expenses over revenues during a single accounting period.

Department: A basic organizational unit of government that is functionally unique in its delivery of services. The components are hierarchically arranged as follows: Department (such as Public Works):
and Division (such as Sewer Maintenance).

Depreciation: The loss in value of an asset, due to physical changes, obsolescence, or factors outside of the asset.

Development-related Fees: Fees and charges generated by building, development, and growth in a community. Included in development-related fees are building permits, development review fees, and zoning and subdivision fees.

Disbursement: The expenditure of monies from an account.

Division: An organizational component of a department.

Encumbrance: The commitment of appropriated funds to purchase goods or services. An encumbrance is not an expenditure. An encumbrance reserves funds to be expended on a specific item or service.

Enterprise Fund: A proprietary fund used to account for operations that are financed and operated in a manner similar to private business enterprises. The intent of enterprise funds is to have the costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. The rate schedule for these services is established to ensure that revenues are adequate to meet all necessary expenditures.

Expenditure/Expense: The outflow of funds paid or to be paid for an asset obtained or goods and services obtained regardless of when the expenditure is actually paid. The term expenditure applies to Governmental Funds, while the term expense is used for Enterprise and Internal Service Funds.

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Budget Glossary
Expenditure Object Code: Unique identification number and title for a minor expenditure category. Represents the most detailed level of budgeting and recording of expenditures, also referred to as a “line item.”
Fiscal Policy: A government’s policies with respect to revenues, spending, and debt management as these relate to government services, programs and capital investment. Fiscal policy provides an agreedupon set of principles for the planning and programming of government budgets and their funding.

Fiscal Year (FY): The 12-month period for recording financial transactions. The City of Arroyo Grande has specified the fiscal year to begin July 1st and end June 30th.

Fixed Assets: Assets of long-term character such as land, buildings, machinery, equipment, and furniture.

Franchise Fee: A franchise fee is charged for the privilege of using public rights-of way and property within the City for public or private purposes. The City currently assesses franchise fees on utilities such as electricity, gas and solid waste collection.

Full-time Equivalent Position (FTE): Positions or fractions thereof based on full-time definition of forty hours of work per week.

Fund: A separate accounting entity with a self-balancing set of accounts to record all financial transactions (revenues and expenditures) for specific activities or government functions. Funds are classified into three categories: governmental, proprietary, and fiduciary. Commonly used funds in governmental accounting are General Fund, Special Revenue Funds, Debt Service Funds, Capital Project Funds, Enterprise Funds, Internal Service Funds, Agency Funds, and Special Assessment Funds.

Fund Accounting: The basis of accounting used particularly by governments. Since there is no profit motive, accountability is measured instead of profitability. The main purpose is stewardship of financial resources received and expended in compliance with legal requirements. Financial reporting is directed at the public rather than investors.

Fund Balance: The excess of assets over liabilities of a fund.

GANN Limit: State of California legislation that limits a City’s total appropriations from tax revenues.

Gas Tax Fund: A fund to account for receipts and expenditures of money apportioned under Street and Highway Code section 2105, 2106, 2107, and 2107.5 of the State of California.

General Fund: The primary operating fund of the City, which accounts for resources and services traditionally associated with government. The General Fund provides administrative, financial, police protection, community development, public works, and recreation services to the community and other

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Budget Glossary
funds. The General Fund accounts for revenues that have unrestricted uses and are not required legally or by contractual agreement to be accounted for in another fund.

Generally Accepted Accounting Principles (GAAP): Uniform minimum standards for financial accounting and recording, encompassing the conventions, rules, and procedures that define accepted accounting principles.

General Obligation Bond: Bonds that are usually limited by state law as to the amount as well as the length of indebtedness that a government can have. These “Full Faith and Credit” bonds are secured by all of the financial assets of the local government, including property taxes.

Goal: A general statement of broad direction, purpose, or intent that describes the essential reason for existence and which is not limited to a one-year time frame. Generally, a goal does not change from year to year.

Grant: Contributions of gifts or cash or other assets from another governmental entity to be used or expended for a specific purpose, activity, or facility. An example is the Community Development Block Grant awarded by the federal government.

Indirect Cost: Costs that cannot be easily seen in the product or service. Electricity, insurance, and data processing costs are examples of indirect costs.

Infrastructure: The physical assets of the City, i.e. streets, water, sewer, public buildings, and parks, and the support structures within a development.

Interfund Transfers: The movement of monies between funds to assist in financing the services for the recipient fund.

Intergovernmental Revenue: Funds received from federal, state, and other local government sources in the form of grants, shared revenues, and payments in lieu of taxes.

JPA: Joint Powers Agreement. An entity created by two or more public authorities to jointly exercise any power common to all of them. The City of Arroyo Grande joined in a JPA, California Joint Powers Insurance Association, for the purpose of jointly managing liability and workers compensation issues.

The City is also a member of the Five Cities Fire Authority, a JPA for fire services with the City of Grover Beach and Oceano Community Services District.

Jurisdiction: Geographic or political entity governed by a particular legal system or body of laws.

Liability: Debt or other legal obligations arising out of transactions in the past which must be liquidated, renewed or refunded at some future date.

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Budget Glossary
Local Use Tax Fund: Fund to account for the ½% local sales tax increase approved by the voters in November of 2006.

Long-term Debt: Debt with a maturity of more than one year after the date of issuance.

Modified Accrual Basis or Modified Accrual Method: Accounting method whereby income and expense items are recognized, as they are available and measurable.

Objective: Measurable statement of the intended beneficial and tangible effects of a program’s activities. An objective is a specific target toward which a manager can plan, schedule work activities, and make staff assignments. An objective is stated in quantifiable terms such that it is possible to know when it has been achieved. Examples are increase an activity by a specific amount by a certain date; maintain a service level; reduce the incidence of something by a specific amount by a given date, or eliminate a problem by a set date. The emphasis is on performance and its measurability.

Operating Expense: A series of object codes, which include expenditures for items, which primarily benefit the current period and not defined as personnel services, contractual services, or capital outlays.

Operating Revenues: Funds that the government receives as income to pay for ongoing operations. It includes such items as taxes, fees from specific services, interest earnings, and grant revenues. Operating revenues are used to pay for day-to-day services.

Organization Chart: A chart showing the interrelationships of positions within an organization in terms of authority and responsibilities. There are basically three patterns of organization: line organization, functional organization, and line and staff organization.

Performance Measures: Specific quantitative measures of work performed with a program (i.e. miles of streets cleaned). Also, specific quantitative measures of results obtained through a program (i.e. percent reduction in response time compared to previous year).

PERS: Public Employees Retirement System, which is the state retirement system for public employees that provides its members with benefits at retirement or upon disability or death.

Program: A group of related activities performed by one or more organizational units for the purpose of accomplishing a function for which the government is responsible.

Proprietary Funds: These funds account for records of operations similar to those found in a business, such as Enterprise funds and Internal Service funds.

Redevelopment Agency (RDA): A separate legal entity governed by the California Community Redevelopment Law. RDAs were officially dissolved by the California Legislature as of February 1, 2012.

To facilitate the dissolution process, Successor Agencies were established to manage redevelopment

173
Budget Glossary
projects underway, make payments on enforceable obligations, and dispose of redevelopment assets and properties.

Redevelopment Fund: A fund to account for transactions related to proceeds from bonds and other resources and their use to perform redevelopment activities within specific project areas.

Resolution: A special or temporary order of a legislative body; an order of a legislative body requiring less legal formality than an ordinance or statute.

Restricted Fund Balance: The portion of a fund’s balance legally restricted for a specific purpose and, therefore, not available for general appropriations.

Revenues: Funds received from various sources and treated as income to the City that are used to finance expenditures. Examples are tax payments, fees for services, receipts from other governments, fines, grants, licenses, permits, shared revenue, and interest income.

SEIU: Service Employees International Union, Local 620. This union represents all full time employees other than police and management employees.

Special Assessment Fund: Contain moneys received from special charges levied on property owners who benefit from a particular capital improvement or service.

Special Revenue Fund: A governmental fund type used to account for specific revenues that are legally restricted to expenditures for particular purposes.

Subvention: That portion of revenues collected by other government agencies on the City’s behalf.

Taxes: Compulsory charges levied by a government for the purpose of financing services performed for the common benefit of the people. This term does not include specific charges made against particular persons or property for current or permanent benefit, such as special assessments.

Transient Occupancy Tax: A tax imposed on travelers who stay in temporary lodging establishments in the City. The tax is collected by the operators of lodging establishments located within the City, on behalf of the City. This tax is then remitted to the City.

User Charges/Fees: The payment of a fee for the direct receipt of a public service by the party benefitting from the service.

174
Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

MISCELLANEOUS PROJECTS
350-5453 Financial Management Software 4930 - Sewer Fund 95,000 47,500 - - - - 4940 - Water Fund 95,000 47,500 - - - -
4950 - Sales Tax 223,000 93,000 - - - - 188,000
350-5468 Community Safety Camera Network 4929 - COPS 244,300 119,300 - - - - 4965 - ARPA 880,700 880,700 - - - - 1,000,000
350-54XX City Hall Second Story Patio Repair 4950 - Sales Tax - - 40,000 - - - 40,000 350-54XX Public Works Office Space Remodel 4950 - Sales Tax 100,000 100,000 - - - - 100,000 350-5475 ADA Transition Plan 4463 - CDBG 12,391 - 12,391 - - - 4499 - Other Gov Agencies 23,500 - 23,500 - - -
4950 - Sales Tax 75,834 - 75,834 - - - 111,725
350-54XX
Police Department Building Roof
Repair 4950 - Sales Tax 20,000 - 20,000 - - - 20,000
350-5422 Le Point Street Parking Lot Expansion 4950 - Sales Tax 91,000 - 85,000 6,000 - - 49XX - In-Lieu Parking Fee 144,000 - - 144,000 - - 235,000 350-5430 Short Street Plaza 4950 - Sales Tax 30,000 - - - 30,000 - 30,000 350-54XX Arroyo Grande Creek Remediation 4950 - Sales Tax 26,000 26,000 - - - - 44XX - FEMA Reimbursement 300,000 300,000 - - - -
44XX - CalOES Reimbursement 74,000 74,000 - - - - 400,000 350-54XX Fire Station Apparatus Bay Doors 4950 - Sales Tax 115,000 115,000 - - - - 115,000 350-5470
Report Management System (RMS)
Upgrade at PD 4929 - COPS 150,000 - - - - 150,000 150,000 350-54XX
Property and Evidence Storage
System Upgrade 4950 - Sales Tax 25,000 - - - - 25,000 25,000 350-54XX Generator for City Hall 4950 - Sales Tax 200,000 - - - - 200,000 200,000 Total Miscellaneous Projects 2,924,725 1,803,000 256,725 150,000 30,000 375,000 2,614,725 Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

PARKS PROJECTS
350-5556
Recreation Services / Community
Center Building 4950 - Sales Tax 1,696,195 - 150,000 - 1,500,000 - 4499 - Other Gov Agencies 4,500,000 - - - 4,500,000 - 6,150,000 350-55XX New Play Structure - Parkside Park 4915 - Parkside Assessment District 250,000 - 250,000 - - - 250,000 350-55XX
Ash Street Restroom Roof
Replacement 4914 - Park Improvement 65,000 - - 65,000 - - 65,000 Total Parks Projects 6,511,195 - 400,000 65,000 6,000,000 - 6,465,000 ATTACHMENT 2

Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

STREETS PROJECTS
350-5601
Fair Oaks Ave Active Transportation
Improvements, Valley Road to Traffic
Way 4825 - Developer 50,000 - - - - -
4499 - Other Gov Agencies 6,472,500 - - 236,250 236,250 6,000,000 4950 - Sales Tax 772,500 75,000 225,000 236,250 236,250 - 7,245,000 350-5606 Halcyon Road Complete Streets 4479 - HSIP 252,000 252,000 - - - - 4482 - RSHA 749,000 - 749,000 - - -
4486 - USHA 267,530 - - - - -
44XX - Safe Routes to School 100,000 - - - - -
4910 - General Fund 8,014 - - - - -
4950 - Sales Tax 11,602 - - - - -
44XX - ATP 8,169,000 1,052,000 3,684,500 3,432,500 - - 9,170,000 350-5614 Bridge Street Bridge Habitat Mitigation 4487 - HBP 243,140 48,628 48,628 48,628 145,884 350-5638 Pavement Management Program 4486 - USHA 68,900 - - - - - 4910 - General Fund 3,128,685 - 2,360,000 - - -
4920 - SB1 2,560,500 453,300 450,000 450,000 450,000 450,000 4950 - Sales Tax 10,414,713 1,210,080 2,062,870 1,250,000 1,000,000 1,250,000 11,386,250 350-5658 Sidewalk Repairs and Improvements 4950 - Sales Tax 480,000 - 240,000 - 240,000 - 480,000 350-5679 Traffic Way Bridge Replacement 4487 - HBP 11,407,543 635,645 4,817,626 4,817,626 - - 4950 - Sales Tax 1,583,960 82,355 624,175 624,175 - - 11,601,600 350-56XX Active Transportation Plan (ATP) 44XX - ATP 221,325 110,663 - - - - 4950 - Sales Tax 28,675 14,337 - - - - 125,000
350-56XX
Virginia Drive and S. Halcyon Road
Curb Ramp and Sidewalk
Improvement 4463 - CDBG 56,749 56,749 - - - - 56,749
350-56XX 191 Tally Ho 4950 - Sales Tax 110,000 110,000 - - - - 110,000 350-5621 Arroyo Grande Creek Stabilization 4950 - Sales Tax 40,000 - - 40,000 - - 40,000 Total Streets Projects 48,272,605 4,100,757 15,261,798 11,095,428 2,162,500 7,700,000 40,360,483 Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

DRAINAGE PROJECTS
350-5794
Corrugated Metal Pipe (CMP)
Investigation and Repair 4950 - Sales Tax 400,000 - 100,000 100,000 100,000 100,000 400,000 350-5798 Trash Capture Devices 4950 - Sales Tax 214,000 - - 214,000 - - 214,000 Total Drainage Projects 614,000 - 100,000 314,000 100,000 100,000 614,000

Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

SEWER PROJECTS
612-5817
Trenchless Sewer Rehabilitation - El
Camino Read to West Branch Street 4965 - ARPA 282,000 282,000 - - - - 282,000 612-58XX Lift Station 3 4950 - Sales Tax 55,250 55,250 - - - - 44XX - FEMA Reimbursement 637,500 637,500 - - - -
44XX - CalOES Reimbursement 157,250 157,250 - - - - 850,000 612-58XX
Trenchless Sewer Rehabilitation -
Pilgrim Way, Orchard Avenue, West
Cherry Avenue and California Street 4930 - Sewer Fund 282,000 - 282,000 - - - 282,000 612- 5854 Wastewater Master Plan Update 4930 - Sewer Fund 100,000 - - 100,000 - - 100,000 612-5849 Maintenance Hole Rehabilitation 4930 - Sewer Fund 300,000 - - 100,000 100,000 100,000 300,000 612-58XX
Trenchless Sewer Rehabilitation -
South Alpine and Ash Street 4930 - Sewer Fund 175,000 - - 175,000 - - 175,000 612-58XX
Trenchless Sewer Rehabilitation -
Alder and Cameron Court to Victorian
Way 4930 - Sewer Fund 300,000 - - - 300,000 - 300,000
612-5826
Trenchless Sewer Rehabilitation -
Woodland Drive 4930 - Sewer Fund 132,200 - - - - 132,200 132,200 Total Sewer Projects 875,000 - - 375,000 400,000 100,000 2,421,200 Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

WATER PROJECTS
640-5973
Phased Main Replacement - Highway
101 Crossing Upgrade, El Camino
Real to West Branch Street 4940 - Water Fund 43,800 43,800 - - - - 4965 - ARPA 291,200 - - - - - 43,800
640-5953
SCADA Software/Electronics Design
and Upgrade 4940 - Water Fund 330,000 - 330,000 - - - 330,000 640-59XX
Reservoir No. 5 Redundancy
Interconnect 4940 - Water Fund 100,000 - 100,000 - - - 100,000 640-59XX Water Master Plan Update 4940 - Water Fund 100,000 - - 100,000 - - 100,000 640-59XX
Phased Main Replacement – Cornwall
Street 4940 - Water Fund 1,000,000 - - 125,000 875,000 - 1,000,000 640-5911
Phased Mains Replacement - North
Halcyon to El Camino 4940 - Water Fund 673,500 - - - 673,500 - 4942 - Water Facility 100,000 - - - 100,000 - 773,500
640-5948 Reservoir No. 4 Exterior Coating 4940 - Water Fund 500,000 - - - 500,000 - 500,000 640-59XX Miller Way Booster Zone Upgrade 4940 - Water Fund 300,000 - - - - 300,000 300,000 Total Water Projects 3,438,500 43,800 430,000 225,000 2,148,500 300,000 3,147,300 Grand Total, All Capital Projects 64,222,225 7,079,557 16,730,523 12,264,428 10,841,000 8,707,200 55,622,708

Item 2023-24 2024-25 2025-26 2026-27 2027-28 5-Year Total Fair Oaks/Orchard Rd Intersection Imp 75,000 225,000 236,250 236,250 - 772,500 Swinging Bridge Reinf orcement - - - - - -
Traf f ic Way Bridge Improv ements 82,355 624,175 624,175 - 1,330,705 - Subtotal Transportation 157,355 849,175 860,425 236,250 - 2,103,205 Pav ement Management Program 2,062,870 1,210,080 1,250,000 - 1,250,000 5,772,950 Striping and Sidewalk Improv ements - 240,000 - 200,000 - 440,000 Short Street Plaza - - - 30,000 - 30,000
Harloe Elem Ped Access Enhancements - - - - - -
191 Tally Ho 110,000 - - - 110,000 -
Guardrail Replacement - - - - - -
Activ e Transportation Plan 14,337 - - - - 14,337
Arroy o Grande Creek Remediation 26,000 - - - - 26,000
Arroy o Grande Creek Stabilization - - 40,000 - - 40,000 Subtotal Street/Park Improv ements 2,302,870 1,360,417 1,290,000 230,000 1,250,000 6,433,287 CMP Replacements - 100,000 100,000 100,000 100,000 400,000 Trash Capture Dev ices - - 214,000 - 214,000 -
Subtotal Drainage Improv ements - 100,000 314,000 100,000 100,000 614,000 Fire JPA 949,000 994,500 1,024,335 1,044,822 1,065,718 5,078,375 Police Senior Of f icer Position 183,700 190,100 196,800 203,700 210,800 985,100 Narcotics Task Force 24,600 24,600 24,600 24,600 24,600 123,000 Animal Serv ices Building Debt Serv ice 60,000 60,000 60,000 60,000 60,000 300,000 Subtotal Public Saf ety 1,269,200 1,217,300 1,305,735 1,333,122 1,361,118 6,486,475 City Hall Debt Serv ice 20,000 20,000 20,000 20,000 20,000 100,000 Corporation Yard Renov ations - - - - - -
Recreation Serv ices / Community Center Buildi - 150,000 - 1,500,000 - 1,650,000 Elm St. Park Play ground Structure - - - - - -
Fire Station 1 Generator Replacement - - - - - -
Lif t Station 3 55,200 - - - - 55,200
Various Open Space Fire/Fuel Management - - - - - -
ADA Transition Plan - 75,834 - - - 75,834
Public Works Of f ice Space Remodel 100,000 - - - 100,000 - Police Department Building Roof Repair - 20,000 - - - 20,000 Property and Ev idence Storage Sy stem Upgrad - - - - 25,000 25,000 Generator f or City Hall - - - 200,000 - 200,000
Fire Station Apparatus Bay Doors 115,000 - - - 115,000 - City Hall Second Story Patio Repair - 40,000 - - - 40,000 Woman's Club Improv ements - - - - - -
Le Point Street Parking Lot Expansion - 85,000 6,000 - - 91,000 Financial Management Sy stem 93,000 - - - - 93,000
Network Switch Replacement - - - - - -
Fuel Management Sy stem/Dispenser Replcmnt - - - - - -
Subtotal City Facilities 383,200 390,834 26,000 1,520,000 245,000 2,565,034 Annual Audit and Sales Tax Report 7,500 7,500 7,500 7,500 7,500 37,500 Contingency 25,000 25,000 25,000 25,000 25,000 125,000
Subtotal Other 32,500 32,500 32,500 32,500 32,500 162,500 Total Expenses 4,944,579 3,150,772 3,828,660 3,451,872 2,988,618 18,364,501 Rev enue 3,033,000 2,962,000 3,124,000 3,217,700 3,314,200 15,650,900 Rev enue Ov er/(Under) Expenses (1,911,579) (188,772) (704,660) (234,172) 325,582 Beginning Fund Balance 2,903,848 3,092,620 992,269 287,609 53,438 Estimated Ending Fund Balance 992,269 2,903,848 287,609 53,438 379,019 % Fund Balance of Estimated Rev enues 98% 33% 9% 2% 11%

CITY OF ARROYO GRANDE
5-Year Rev enue and Expenditure Plan
ATTACHMENT 3

MEMORANDUM
TO: City Council
FROM: Nicole Valentine, Administrative Services Director SUBJECT: Supplemental Information
Agenda Item 10.a. – June 13, 2023 City Council Meeting
Public Hearing to Consider the FY 2023-25 Biennial Budget and 5-Year Capital Improvement Program Budget
DATE: June 13, 2023
The staff report for Item 10.a. includes a Table 3– 5-Year PMP Plan, which summarizes funding for the City’s Pavement Management Program (PMP) through Fiscal Year (FY) 2027-28. Table 3 includes the $3 million in reserves that Council directed be allocated to the PMP when the preliminary budget was discussed on May 23, 2023. However, Table 3 did not reflect adjustments to funding for the PMP in FY 2026-27 that were necessary to ensure that sufficient funding exists for the other identified projects that year. Local Sales Tax funding for sidewalks was also reduced in FY 2026-27 for the same reason.

Attachment 3 to the staff report reflects the correct recommended allocations for the PMP and sidewalks projects, which are:

Attachment 2 has been revised to reflect these allocations, and Attachment 1 will be revised when presented for adoption on June 27, 2023. Table 3 in the staff report should read as follows:

Table 3 – 5-Year PMP Plan
cc: City Manager
City Attorney
City Clerk
City Website and Public Review Binder
Item 2023-24 2024-25 2025-26 2026-27 2027-28 5-Year Total Pavement Management Program 1,210,080 2,062,870 1,250,000 - 1,250,000 5,772,950 Striping and Sidewalk Improvements - 240,000 - 200,000 - 440,000 5-Year Revenue and Expenditure Plan
Funding Source FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year
Total
4486 - USHA - - - - -
4910 - General Fund - 2,360,000 - - -
4920 - SB1 453,300 450,000 450,000 450,000 450,000
4950 - Sales Tax 1,210,080 2,062,870 1,250,000 - 1,250,000 10,386,250

Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

MISCELLANEOUS PROJECTS
350-5453 Financial Management Software 4930 - Sewer Fund 95,000 47,500 - - - - 4940 - Water Fund 95,000 47,500 - - - -
4950 - Sales Tax 223,000 93,000 - - - - 188,000
350-5468 Community Safety Camera Network 4929 - COPS 244,300 119,300 - - - - 4965 - ARPA 880,700 880,700 - - - - 1,000,000
350-54XX City Hall Second Story Patio Repair 4950 - Sales Tax 40,000 - 40,000 - - - 40,000 350-54XX Public Works Office Space Remodel 4950 - Sales Tax 100,000 100,000 - - - - 100,000 350-5475 ADA Transition Plan 4463 - CDBG 12,391 - 12,391 - - - 4499 - Other Gov Agencies 23,500 - 23,500 - - -
4950 - Sales Tax 75,834 - 75,834 - - - 111,725
350-54XX
Police Department Building Roof
Repair 4950 - Sales Tax 20,000 - 20,000 - - - 20,000
350-5422 Le Point Street Parking Lot Expansion 4950 - Sales Tax 91,000 - 85,000 6,000 - - 49XX - In-Lieu Parking Fee 144,000 - - 144,000 - - 235,000 350-5430 Short Street Plaza 4950 - Sales Tax 30,000 - - - 30,000 - 30,000 350-54XX Arroyo Grande Creek Remediation 4950 - Sales Tax 26,000 26,000 - - - - 44XX - FEMA Reimbursement 300,000 300,000 - - - -
44XX - CalOES Reimbursement 74,000 74,000 - - - - 400,000 350-54XX Fire Station Apparatus Bay Doors 4950 - Sales Tax 115,000 115,000 - - - - 115,000 350-5470
Report Management System (RMS)
Upgrade at PD 4929 - COPS 150,000 - - - - 150,000 150,000 350-54XX
Property and Evidence Storage System
Upgrade 4950 - Sales Tax 25,000 - - - - 25,000 25,000
350-54XX Generator for City Hall 4950 - Sales Tax 200,000 - - - - 200,000 200,000 Total Miscellaneous Projects 2,964,725 1,803,000 256,725 150,000 30,000 375,000 2,614,725 Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

PARKS PROJECTS
350-5556
Recreation Services / Community
Center Building 4950 - Sales Tax 1,696,195 - 150,000 - 1,500,000 - 4499 - Other Gov Agencies 4,500,000 - - - 4,500,000 - 6,150,000 350-55XX New Play Structure - Parkside Park 4915 - Parkside Assessment District 250,000 - 250,000 - - - 250,000 350-55XX
Ash Street Restroom Roof
Replacement 4914 - Park Improvement 65,000 - - 65,000 - - 65,000 Total Parks Projects 6,511,195 - 400,000 65,000 6,000,000 - 6,465,000 ATTACHMENT 3

Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

STREETS PROJECTS
350-5601
Fair Oaks Ave Active Transportation
Improvements, Valley Road to Traffic
Way 4825 - Developer 50,000 - - - - -
4499 - Other Gov Agencies 6,472,500 - - 236,250 236,250 6,000,000 4950 - Sales Tax 772,500 75,000 225,000 236,250 236,250 - 7,245,000 350-5606 Halcyon Road Complete Streets 4479 - HSIP 252,000 252,000 - - - - 4482 - RSHA 749,000 - 749,000 - - -
4486 - USHA 267,530 - - - - -
44XX - Safe Routes to School 100,000 - - - - -
4910 - General Fund 8,014 - - - - -
4950 - Sales Tax 11,602 - - - - -
44XX - ATP 8,169,000 1,052,000 3,684,500 3,432,500 - - 9,170,000 350-5614 Bridge Street Bridge Habitat Mitigation 4487 - HBP 243,140 48,628 48,628 48,628 145,884 350-5638 Pavement Management Program 4486 - USHA 68,900 - - - - - 4910 - General Fund 3,128,685 - 2,360,000 - - -
4920 - SB1 2,560,500 453,300 450,000 450,000 450,000 450,000 4950 - Sales Tax 9,414,713 1,210,080 2,062,870 1,250,000 - 1,250,000 10,386,250 350-5658 Sidewalk Repairs and Improvements 4950 - Sales Tax 440,000 - 240,000 - 200,000 - 440,000 350-5679 Traffic Way Bridge Replacement 4487 - HBP 11,407,543 635,645 4,817,626 4,817,626 - - 4950 - Sales Tax 1,583,960 82,355 624,175 624,175 - - 11,601,600 350-56XX Active Transportation Plan (ATP) 44XX - ATP 221,325 110,663 - - - - 4950 - Sales Tax 28,675 14,337 - - - - 125,000
350-56XX
Virginia Drive and S. Halcyon Road
Curb Ramp and Sidewalk Improvement 4463 - CDBG 56,749 56,749 - - - - 56,749 350-56XX 191 Tally Ho 4950 - Sales Tax 110,000 110,000 - - - - 110,000 350-5621 Arroyo Grande Creek Stabilization 4950 - Sales Tax 40,000 - - 40,000 - - 40,000 Total Streets Projects 47,232,605 4,100,757 15,261,798 11,095,428 1,122,500 7,700,000 39,320,483 Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

DRAINAGE PROJECTS
350-5794
Corrugated Metal Pipe (CMP)
Investigation and Repair 4950 - Sales Tax 400,000 - 100,000 100,000 100,000 100,000 400,000 350-5798 Trash Capture Devices 4950 - Sales Tax 214,000 - - 214,000 - - 214,000 Total Drainage Projects 614,000 - 100,000 314,000 100,000 100,000 614,000

Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

SEWER PROJECTS
612-5817
Trenchless Sewer Rehabilitation - El
Camino Read to West Branch Street 4965 - ARPA 282,000 282,000 - - - - 282,000 612-58XX Lift Station 3 4950 - Sales Tax 55,200 55,200 - - - - 44XX - FEMA Reimbursement 637,500 637,500 - - - -
44XX - CalOES Reimbursement 157,300 157,300 - - - - 850,000 612-58XX
Trenchless Sewer Rehabilitation -
Pilgrim Way, Orchard Avenue, West
Cherry Avenue and California Street 4930 - Sewer Fund 282,000 - 282,000 - - - 282,000 612- 5854 Wastewater Master Plan Update 4930 - Sewer Fund 100,000 - - 100,000 - - 100,000 612-5849 Maintenance Hole Rehabilitation 4930 - Sewer Fund 300,000 - - 100,000 100,000 100,000 300,000 612-58XX
Trenchless Sewer Rehabilitation -
South Alpine and Ash Street 4930 - Sewer Fund 175,000 - - 175,000 - - 175,000 612-58XX
Trenchless Sewer Rehabilitation -
Alder and Cameron Court to Victorian
Way 4930 - Sewer Fund 300,000 - - - 300,000 - 300,000
612-5826
Trenchless Sewer Rehabilitation -
Woodland Drive 4930 - Sewer Fund 132,200 - - - - 132,200 132,200 Total Sewer Projects 2,421,200 1,132,000 282,000 375,000 400,000 232,200 2,421,200 Project Number Request Title Funding Source
Total Project
Budget FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 5-Year Total

WATER PROJECTS
640-5973
Phased Main Replacement - Highway
101 Crossing Upgrade, El Camino
Real to West Branch Street 4940 - Water Fund 43,800 43,800 - - - - 4965 - ARPA 291,200 - - - - - 43,800
640-5953
SCADA Software/Electronics Design
and Upgrade 4940 - Water Fund 330,000 - 330,000 - - - 330,000 640-59XX
Reservoir No. 5 Redundancy
Interconnect 4940 - Water Fund 100,000 - 100,000 - - - 100,000 640-59XX Water Master Plan Update 4940 - Water Fund 100,000 - - 100,000 - - 100,000 640-59XX
Phased Main Replacement – Cornwall
Street 4940 - Water Fund 1,000,000 - - 125,000 875,000 - 1,000,000 640-5911
Phased Mains Replacement - North
Halcyon to El Camino 4940 - Water Fund 673,500 - - - 673,500 - 4942 - Water Facility 100,000 - - - 100,000 - 773,500
640-5948 Reservoir No. 4 Exterior Coating 4940 - Water Fund 500,000 - - - 500,000 - 500,000 640-59XX Miller Way Booster Zone Upgrade 4940 - Water Fund 300,000 - - - - 300,000 300,000 Total Water Projects 3,438,500 43,800 430,000 225,000 2,148,500 300,000 3,147,300 Grand Total, All Capital Projects 63,222,225 7,079,557 16,730,523 12,264,428 9,801,000 8,707,200 54,582,708

Item 11.a.

MEMORANDUM
TO: City Council
FROM: Whitney McDonald, City Manager
Nicole Valentine, Administrative Services Director/FCFA Treasurer Isaac Rosen, City Attorney
SUBJECT: Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
DATE: June 13, 2023
SUMMARY OF ACTION:

Approve the Amended and Restated Joint Exercise of Powers Agreement for the FCFA (with direction to transmit the approved Joint Exercise of Powers Agreement consistent with State law) with a formal execution date of June 22, 2023, and appoint two members of the City Council to the FCFA Board of Directors. Consider the two proposed agreements between the FCFA and the Oceano Community Services District (OCSD) regarding short-term fire and emergency response services and ongoing postemployment liabilities of the OCSD to the FCFA, which will be proposed for approval by the FCFA Board of Directors. Review the draft Fiscal Year (FY) 2023-24 budget of the FCFA and provide direction to the City’s representatives on the FCFA Board of Directors regarding the proposed budget.

IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:

It is estimated that the City’s costs for fire and emergency services will increase significantly as a result of the OCSD’s exit from the FCFA and the effects of static funding amounts from the three current parties to the FCFA since FY 2019-20. The City’s financial contributions to the FCFA will increase from $2,580,955 in FY 2022-23 to $3,796,000 in FY 2023-24. This amount assumes that a contract for fire and emergency response service is approved between the FCFA and the OCSD, which would require a payment of $1,150,000 from the OCSD for service through June 30, 2024.

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

RECOMMENDATION:
1) Approve the Amended and Restated Joint Exercise of Powers Agreement for the FCFA (with direction to transmit the approved Joint Exercise of Powers Agreement consistent with State law) with a formal execution date of June 22, 2023; 2) Appoint two members of the City Council to the FCFA Board of Directors; 3) Consider the two proposed agreements between the FCFA and the OCSD regarding short-term fire and emergency response services and ongoing post-employment liabilities of the OCSD to the FCFA, which will be proposed for approval by the FCFA Board of Directors; and 4) Review and provide direction to the City’s representatives on the FCFA Board of Directors regarding the draft FCFA FY 2023-24 Budget.

BACKGROUND:

Several updates and discussion items have been presented to the City Council since June 2022 regarding the FCFA and a number of changes anticipated for the organization.

As discussed previously, the OCSD is exiting the FCFA pursuant to the terms of the Third Amendment to the current Joint Exercise of Powers Agreement (Third Amendment) following the failed parcel tax measure proposed by the OCSD in June 2022 that aimed to raise revenue for continued fire and emergency service to the Oceano community.

The Third Amendment calls for a “wind down” process that has been occurring since July 1, 2022, in anticipation of the OCSD’s exit. A summary of the wind down process was shared with the FCFA Board of Directors on July 15, 2022, and with the City Council on August 9, 2022. The work program elements identified in the Third Amendment have been completed as follows:
 A determination as to the distribution of equipment and physical assets by October 1, 2022 (effective June 30, 2023).
o A physical asset list has been completed and the OCSD’s share of the remaining assets has been determined. This list is provided in Attachment

4.  An estimate as to the distribution of debt, employment liability, pension/PERS and other post-employment obligations by February 1, 2023 (effective June 30, 2023). o An actuary, Foster & Foster, has been retained and has completed a draft actuarial report identifying the post-employment liabilities of the FCFA through June 30, 2021 (see Exhibit A to Attachment 3). This is the most recent data available from CalPERS and will be updated to include 2022 liabilities by the fall. 2023 liabilities will not be known until the fall of 2024 and will be included in a revised actuarial report that will be used to calculate OCSD’s total share of outstanding liabilities associated with their departure from FCFA.

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

o A contract addressing OCSD’s ongoing liabilities to the FCFA has been prepared and provided in Attachment 3 for review. This agreement is discussed in more detail below.
 An estimate as to the distribution of all other assets by March 1, 2023 (effective June 30, 2023).
o The OCSD will be entitled to a 19.6% share of the FCFA’s general fund balance remaining on June 30, 2023, according to the FCFA’s audited financials. It is estimated that this amount will be approximately $280,000.

A number of additional efforts have also been underway in anticipation of the OCSD’s exit from the FCFA. The OCSD has submitted an application to the Local Area Formation Commission (LAFCo) to divest itself of its fire and emergency service powers effective June 30, 2023. Through the LAFCo process, OCSD is requesting that the County of San Luis Obispo (County) take over fire and emergency service responsibilities to the Oceano community, which will require all of the parties to the divestiture application (the County, OCSD, and LAFCo) to approve a plan of service. Due to the shortness of time before OCSD is required to leave the FCFA, it is anticipated that the cities of Arroyo Grande and Grover Beach will be requested to consider terms for a potential agreement for the FCFA to continue providing services to Oceano during the completion of the LAFCo process.

Additionally, the Cities of Arroyo Grande and Grover Beach, with the assistance of FCFA staff, have prepared a number of evaluations and agreements that will govern operations of the FCFA as a two-member organization. In October 2022, the cities engaged the services of a consultant, Baker Tilly, to conduct an organizational assessment of the FCFA and to assist in the evaluation of service delivery needs and options, including financial analyses of these options. On February 28, 2023, the City Council received a presentation from Baker Tilly summarizing its recommendations for sustainable and responsive fire and emergency medical services, as well as the anticipated costs of service for both Grover Beach and Arroyo Grande. Baker Tilly provided a similar presentation to the Grover Beach City Council on February 27, 2023. In light of the likelihood that the OCSD’s LAFCo divestiture application would take another 6-12 months to complete after the OCSD’s exit from the FCFA on July 1, 2023, Baker Tilly recommended that the FCFA consider providing ongoing service to Oceano for one year pursuant to a service agreement. The Arroyo Grande and Grover Beach City Councils agreed, and provided direction to Baker Tilly to complete its final report evaluating staffing and funding options with this in mind.

Following the presentation on February 28, 2023, Baker Tilly completed a full written report that was presented to the City Council on April 25, 2023. The financial analyses completed by Baker Tilly are being used by both Arroyo Grande and Grover Beach to prepare their biennial budgets for Fiscal Years 2023-25. The findings and

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

recommendations of the report were also used to develop a new proposed Joint Powers Agreement between the cities of Arroyo Grande and Grover Beach that will govern the FCFA following the OCSD’s exit on June 30, 2023.

A draft Amended and Restated Joint Exercise of Powers Agreement for the FCFA (Amended and Restated JPA) was presented to the City Council on April 25, 2023, along with the final Baker Tilly report and a discussion of potential terms for a short-term service contract between the FCFA and the OCSD. The City Council expressed support for the Amended and Restated JPA as drafted and received and filed the final Baker Tilly report.

Additionally, Council directed that a short-term service agreement be offered to the OCSD at a cost of $1,211,000 for a nine-month term, with a month-to-month extension available at an equivalent monthly cost.

A proposed contract for service was developed incorporating these proposed terms and provided to the OCSD’s General Manager for consideration. On May 10, 2023, the OCSD Board of Directors discussed the proposed terms and provided direction to its General Manager to seek a contract for service with the following terms:
 One-year term at a cost of $1,150,000 to the OCSD; or  Nine-month term at a cost of $862,500; and
 Flexible options for an extension to the term with costs per service commensurate with the yearly cost of $1,150,000.

The City Council considered these requested terms at its May 23, 2023 meeting and provided direction to accept the revised agreement negotiated among legal counsel for the two cities and the OCSD, including the one-year term at a cost of $1,150,000, with further direction that the agreement be modified to require that the cost of any extension of beyond one-year would be the amount that the FCFA would require the County to pay for service to Oceano. The agreement was modified as directed and the OCSD Board of Directors considered and approved the terms contained in the revised agreement at its meeting on May 24, 2023.

During this time frame, the City has also developed preliminary budget recommendations for its Fiscal Years 2023-25 Biennial Budget, presented initially on May 23, 2023. The City’s draft budget presumes that the FCFA’s FY 2023-24 Budget will reflect the projected costs included in the final Baker Tilly report, shown in Table 13 of that report and reproduced below:

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

The City’s draft budget presumes that the FCFA’s FY 2024-25 Budget will reflect the projected costs included in the final Baker Tilly report, shown in Table 19 of that report and reproduced below:

The FCFA FY 2024-25 Budget will continue to be refined as the LAFCo process is completed and will be brought back for review with the Mid-Cycle Budget Update in Spring of 2024.

Pursuant to provisions of the City Council Handbook (discussed in more detail later in this report), prior annual budgets of the FCFA have been presented to the City Council for

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

review and to allow direction to be provided to the City’s appointed representative on the FCFA Board regarding the proposed budget. Because the Second and Third Amendments to the JPA have kept the City’s contribution amount static at $2,580,955 per year since FY 2019-20, the City Council has not considered the FCFA’s annual budget since 2019.

ANALYSIS OF ISSUES:

Amended and Restated JPA
In light of the required exit of the OCSD from the FCFA and the recommendations of Baker Tilly, the City Managers of Arroyo Grande and Grover Beach conducted research regarding other potential two-member fire agencies and their respective governing models. After speaking with representatives from certain example agencies, specifically, the Central Marin Fire Authority, operating in the City of Larkspur and the Town of Corte Madera (Central Marin), and the Central County Fire Department, operating in the cities of Burlingame and Hillsborough (Central County) and providing contract service to the City of Millbrae, the City Managers for Arroyo Grande and Grover Beach determined that the models employed by these two agencies provided an appropriate starting point for a new JPA for the FCFA given their similar sizes and services. A draft amended and restated JPA was prepared by the Arroyo Grande and Grover Beach City Attorneys and staff using the models described above and incorporating the feedback received from the City Councils on February 27 and 28, 2023, with input by the Fire Chief and legal counsel to the FCFA.

As discussed on April 25, 2023, the Amended and Restated JPA for the FCFA provided in Attachment 1 includes the following key terms:
 Governing Board
o Two representatives from each city council, which may include the mayors; o Chair and Vice Chair positions will be held by one representative of each City for a term of one year;
o A rotational schedule for the Chair and Vice Chair will be established by Board bylaws or other FCFA policy;
o At least quarterly meetings of the Board;
o Any action of the Board requires the affirmative vote of at least one member of the Board from each City.
 Executive Management
o A Management Committee made up of the City Manager of each City will be responsible for the executive management of the FCFA; o The Fire Chief will report to the Management Committee, which will be responsible for hiring the Chief;
o A Chief Executive Officer (CEO) will be responsible for carrying out the direction of the Management Committee and act as signatory on items

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

requiring approval of the Committee, such as contracts. The CEO will be the City Manager who is from the city holding the position of Board Chair and will rotate on the same schedule as the Board Chair.  Dispute resolution - New dispute resolution provisions have been added requiring mediation and, if mediation is not successful, arbitration of any disputes that cannot be resolved informally.
 Legal Counsel – The revised JPA includes a provision stating that the FCFA Board may retain legal counsel to represent the FCFA. It is anticipated that the FCFA will retain independent legal counsel in the near future.
 Retention of Existing Terms – A number of existing terms from the current FCFA JPA have been carried forward, including:
o Personnel and Administration – All FCFA employees will continue to be deemed employees of Arroyo Grande, utilizing the City’s current CalPERS contract. Arroyo Grande will continue to provide administrative services to the FCFA, the cost of which will continue to be reimbursed by the FCFA. o Ownership and Maintenance of the Fire Stations – The cities will continue own and maintain the fire stations within their respective jurisdictions.  Exhibits – The current exhibits to the JPA have been updated and revised as follows:
o Exhibit A, Administrative Services – This exhibit has been updated to add a description of IT services, which have been and will continue to be provided by Arroyo Grande, and to remove the previous description of legal services to the FCFA, which are intended to be provided by an independent attorney that will be appointed by the Board, rather than by either City Attorney as discussed in the current agreement.
o Exhibit B, Funding Formula – This exhibit has been updated to include a revised cost sharing structure that excludes the OCSD. Under the new proposed formula, all costs are proposed to be split 58/42, with Arroyo Grande responsible for 58% and Grover Beach responsible for 42%. o Exhibit C, Inventory of Equipment – This exhibit has been revised to include the current list of equipment and apparatus that are owned separately by either Arroyo Grande or Grover Beach.
o Exhibit D, Map of FCFA Service Area – The map of the FCFA’s service area has been revised to include the city boundaries of Arroyo Grande and Grover Beach only.

The agreement is now ready for approval by the City Council. It is recommended that the City Council direct that the Amended and Restated JPA be formally executed on June 22, 2023, when it is anticipated that the new FCFA Board will be convened for its first meeting and will approve the service agreement with the OCSD. The Grover Beach City Council

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

is scheduled to consider approving the proposed Amended and Restated JPA on June 12, 2023.

Appointment of Representatives to the New FCFA Board of Directors In addition to approval of the Amended and Restated JPA, it is recommended that the City Council appoint two members to the FCFA Board of Directors, as required under the Amended and Restated JPA. If desired, Council may also appoint an alternate to serve in the event that one or more appointed City representatives to the FCFA Board are unavailable to attend a meeting. It is anticipated that the City Council Handbook will be revised in the coming months to address changes to the FCFA Board as well as other revisions related to changes to the Arroyo Grande Tourism Business Improvement District Advisory Board.

In order for the new FCFA Board to review and approve the FCFA’s FY 2023-24 Budget and to approve the agreements with the OCSD described in more detail below prior to the beginning of the fiscal year on July 1, it is recommended that the Board be convened on June 22, 2023. Additional agenda items during this meeting will likely include appointment of Chair and Vice-Chair and completion of the weed abatement lien process for 2023.

FCFA Agreements with the OCSD
Two agreements between the FCFA and the OCSD have been prepared and are provided in Attachments 2 and 3 for review by the City Council.

The first agreement in Attachment 2 is a short-term fire and emergency service agreement that will enable the FCFA to continue to serve the community of Oceanothrough June 30, 2024. Key terms of this agreement include:
 OCSD shall pay $1,150,000 for service for the one-year term, paid quarterly;  The agreement may be extended beyond the one-year term subject to the following requirements:
o The cost of service during any extension will be no less than the actual cost of service in the amount or formula determined by FCFA that is presented to the County of San Luis Obispo for purposes of evidencing Oceano’s proportionate share of the actual cost of service;
o Any extension will be negotiated by the parties beginning three months prior to the conclusion of the initial term of the agreement;  Termination:
o Either party may terminate during the initial term by providing 120 days’ written notice;
o If the OCSD is delinquent on any payments, the FCFA may terminate the agreement immediately;

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

o The Agreement will terminate if LAFCo makes a final decision on the OCSD’s divestiture application within the initial term and if that decision would legally preclude the OCSD from participating in the agreement;  Use of OCSD property:
o The FCFA will serve Oceano from Stations 1 and 2 in Arroyo Grande and Grover Beach beginning in July 1, 2023;
o The FCFA will retain the ability to use the apparatus bay at Station 3 in Oceano for storage, as well as OCSD’s well site no. 8 for training purposes, at no cost to the FCFA.

The second agreement provided in Attachment 3 addresses the OCSD’s ongoing obligations for its share of the FCFA’s post-retirement (CalPERS) liabilities. Under the terms of the Third Amendment, the OCSD is subject to ongoing obligations to pay its share of CalPERS liabilities incurred by the FCFA while the OCSD has been a member of the FCFA (from June 7, 2010, through June 30, 2023). Staff for the two cities and the OCSD have prepared an agreement that will address these ongoing liabilities following the OCSD’s exit from the FCFA. Key terms of the agreement include:
 The FCFA will prepare an actuarial analysis each year identifying the estimated liabilities of the FCFA, from which the OCSD’s obligation will be calculated until the obligations are fully paid. A draft actuarial report is attached to the agreement as an example.
 The OCSD may pay its share of the FCFA’s CalPERS obligations on a yearly basis, based on the yearly actuarial analysis, or as a lump sum.  The OCSD’s share of the FCFA’s CalPERS obligations will be offset by its share of the FCFA’s assets as of June 30, 2023. The assets include:
o The OCSD’s proportionate share of the FCFA fund balance as of June 30, 2023, as determined by the FCFA Treasurer based on the audited financial report for FY 2022-23; and
o The OCSD’s proportionate ownership share of the FCFA’s physical assets as of June 30, 2023, which equals $278,109.

These two agreements are provided for review by the City Council. As the agreements are proposed between the FCFA and the OCSD, the Board of Directors of the FCFA and the OCSD will need to approve each agreement in order for them to become effective. It is anticipated that the OCSD Board of Directors will consider approval of the two agreements at its regular meeting scheduled for June 14, 2023. The new FCFA Board of Directors would consider approval of the two agreements at its meeting to be scheduled during the week of June 19th.

Draft FCFA FY 2023-24 Budget

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

Section 5.6 of the City Council Handbook addresses the “Criteria and Process for Council Representatives Seeking Council Direction or Input on Items Being Considered by Regional or Local Boards and Committees.” This section explains that City appointees to various regional or local boards and committees represent the City on these boards and committees “and are granted authority to make decisions in the best interest of the City of Arroyo Grande, as well as the general public and interests served by the specific agency. However, it is appropriate to seek City Council input and/or direction on items meeting criteria that has been established by the City Council.” Additional guidelines are provided regarding the criteria and process for seeking input from the City Council as follows:
“a. When time permits prior to an item scheduled to be voted on by a board or committee that a member of the City Council has been appointed to by the City Council, City Council Members are advised to place items on the City Council agenda for direction and/or input if they meet any of the following criteria:
i. Items that will result in a one-time or annual direct financial impact to the City of over $10,000.
ii. Items that involve new regulations, requirements or other impacts that will result in a significant impact to staff workload or adversely impact Arroyo Grande businesses or citizens.
iii. Items that will create or increase a fee, tax or other charge to Arroyo Grande residents.
iv. Items of a controversial nature that have been frequently reported in the media and have resulted in vocal opposition from the public and/or diverse vocal opinions from interest groups and the public.
v. Items involving issues that the City Council has received a significant number of comments or correspondence from members of the community.” As the draft FCFA FY 2023-24 Budget is anticipated to increase the City’s contributions to the FCFA by more than $10,000, it is recommended that the City Council review and consider providing direction to the City’s representatives on the FCFA Board regarding the budget. Unlike presentations of the FCFA’s proposed budgets in prior years, this year’s discussion is being held with the City Council before the FCFA Board has reviewed and provided preliminary direction regarding the FY 2023-24 budget due to the anticipated adoption of the Amended and Restated JPA and creation of a new FCFA Board.

The FCFA’s Treasurer has prepared a draft FY 2023-24 Budget (Attachment 5) for the FCFA in consultation with the Fire Chief, as well as the City Managers of Arroyo Grande and Grover Beach. The proposed FY 2023-24 Budget recommends approximately $8.7 million in expenditures, including operating costs such as salaries, benefits, services,

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

supplies, maintenance, debt service, and capital related items as shown in the consolidated fund summary table 1 shown below:

Table 1 – FY 2023-24 FCFA Budget Summary
The FY 2023-24 expenditures total $8,746,036 and reflects the recommendations of Baker Tilly’s A-4 staffing plan as well as changes to individual line-item budgets based on staff’s review of the ongoing operational needs of the department and foreseeable onetime expenditures. Key assumptions included in the budget are as follows:
 Two 3-person companies, one 2-person company, and 1 additional battalion chief  OCSD contribution totaling $1,150,000
 Estimated Salary Assumptions
 Contract for a Standards of Cover and Community Risk Assessment study  Upgrades to the Station Alerting system at Stations 1 & 2  Replacement Extrication Equipment
 Replacement Fleet Vehicle
 Reduction in the Debt Service budget in FY 2023-24 compared to estimates provided by Baker Tilly based on financing that will be secured closer to the completion date of equipment
Approved
Budget
Adjusted
Budget
Baker Tilly A-4
Estimate
Proposed
Budget
2020-21 2021-22 2022-23 2022-23 2023-24 2023-24
Beginning Fund Balance $ 1,005,267 $ 1,387,744 $ 1,324,318 $ 1,324,318 $ 1,143,000 $ 1,124,939 $ (18,061) Revenues 6,789,777 6,572,902 5,849,718 7,010,580 8,475,000 8,413,610 (61,390) Expenditures:

Salaries & Benefits 5,254,729 5,546,681 5,522,800 5,645,100 6,801,000 6,801,000 - Services & Supplies 905,228 975,437 1,089,075 1,183,775 1,272,000 1,527,143 255,143 Equipment Replacement 146,147 13,013 100,000 227,187 204,000 264,000 60,000 Debt Service 101,197 101,197 153,897 153,897 464,000 153,893 (310,107) Total Expenditures 6,407,300 6,636,328 6,865,772 7,209,959 8,741,000 8,746,036 5,036 Change in Fund Balance 382,477 (63,426) (1,016,054) (199,379) (266,000) (332,426) Ending Fund Balance $ 1,387,744 $ 1,324,318 $ 308,264 $ 1,124,939 $ 877,000 $ 792,513

10.03% 9.06%
Variance Baker
Tilly vs
Proposed
Better/(Worse)

ACTUALS

FIVE CITIES FIRE AUTHORITY
For the Fiscal Year Ending June 30, 2024

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

The estimated fund balance at the end of FY 2023-24 is $792,513 or 9.06%. The Baker Tilly study suggested that the new Board establish a fund balance policy of 10%.

The Amended and Restated JPA requires the FCFA to adopt a budget by April 30th in order to provide sufficient time for the two cities to include their respective contribution amounts in their own budgets. This timing provision is new to the Amended and Restated JPA and will be followed in future budget years. The Amended and Restated JPA does require the FCFA Board, once the Amended and Restated JPA is approved, to meet within 30 days of that approval to consider the agency’s initial budget.

ALTERNATIVES:

The following alternatives are provided for the Council’s consideration:

1. 1) Approve the Amended and Restated Joint Exercise of Powers Agreement for the FCFA (with direction to transmit the approved Joint Exercise of Powers Agreement consistent with State law) with a formal execution date of June 22, 2023; 2) Appoint two members of the City Council to the FCFA Board of Directors; 3) Consider the two proposed agreements between the FCFA and the OCSD regarding short-term fire and emergency response services and ongoing postemployment liabilities of the OCSD to the FCFA, which will be proposed for approval by the FCFA Board of Directors; and 4) Review and provide direction to the City’s representatives on the FCFA Board of Directors regarding the draft FCFA Fiscal Year 2023-24 Budget; or

2. Appoint two members of the City Council, and one alternate, to the FCFA Board of Directors; or

3. Consider the two proposed agreements between the FCFA and the OCSD regarding short-term fire and emergency response services and ongoing postemployment liabilities of the OCSD to the FCFA, and provide direction to the City’s appointed representatives to the FCFA Board regarding the agreements; or

4. Direct that modifications be made to the Amended and Restated Joint Exercise of Powers Agreement and approve the agreement (which will have the effect of requiring the City of Grover Beach to consider re-approving the agreement with the directed modifications); or

5. Provide other direction to staff.

ADVANTAGES:

Approval of the Amended and Restated JPA, appointment of City representatives to the new FCFA Board, approval by the FCFA Board of the two agreements with the OCSD, and review and direction regarding the draft Fiscal Year 2023-24 FCFA Budget will ensure that the City continues to receive effective fire and emergency response services from the FCFA following the OCSD’s exit as a member agency of the FCFA.

Item 11.a.

City Council
Consideration of Approval of Amended and Restated Joint Exercise of Powers Agreement for FCFA; Appointment of Representatives to the Board of Directors; Agreements Between FCFA and OCSD Regarding Short-Term Fire and Emergency Services and Ongoing CalPERS
June 13, 2023

DISADVANTAGES:

In order to ensure the ongoing delivery of effective fire and emergency response services to the community, the City’s costs will increase by approximately $1.2 million in the upcoming fiscal year.

ENVIRONMENTAL REVIEW:

No environmental review is required for this item.

PUBLIC NOTIFICATION AND COMMENTS:

The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2.

Attachments:

1. Amended and Restated JPA

2. Agreement to Provide Fire Services Between the FCFA and the OCSD

3. Agreement between FCFA and OCSD Regarding OCSD’s Ongoing CalPERS Liabilities and Responsibilities Following Withdrawal From the Five Cities Fire Authority Joint Exercise of Powers Agreement

4. FCFA physical asset list

5. Draft FCFA FY 2023-24 Budget
Enter Recommendation Here

65501.00001\41161259.18
ATTACHMENT 1

AMENDED AND RESTATED

JOINT EXERCISE OF POWERS AGREEMENT
OF

THE FIVE CITIES FIRE AUTHORITY
This JOINT EXERCISE OF POWERS AGREEMENT (the “Agreement” or “JPA”) is dated this __ day of ____, 2023, for reference purposes only, and is entered into by and between the undersigned Member Agencies. The undersigned Member Agencies, the Cities of Arroyo Grande and Grover Beach, may be referred to herein individually as “Member Agency” and collectively as “Member Agencies” or “Members.”

RECITALS
A. The City of Arroyo Grande (“Arroyo Grande”) and the City of Grover Beach (“Grover Beach”), (collectively, “Member Agencies”) have the authority under California law to provide fire protection, emergency medical and related services within their respective jurisdictions.

B. Each Member Agency is a public agency authorized and empowered to contract with the other Member Agency for the joint exercise of powers under the Joint Exercise of Powers Act, Sections 6500, et seq., of the California Government Code (the “Act”).

C. Each Member Agency is a local public entity, and are municipalities in contiguous geographical proximity, having similar fire protection needs, and a history of coordination and cooperation between each other.

D. By jointly exercising fire protection, emergency medical and related services, each Member Agency is able to achieve cost savings and operational efficiencies for the benefit of the persons residing in the Member Agencies’ respective service areas.

E. On June 7, 2010, the Member Agencies, desirous of improving the quality and level of fire suppression and emergency medical service delivery within their communities through the sharing of resources and expertise, entered into a Joint Powers Authority Agreement (the “JPA”) and have operated as Five Cities Fire Authority pursuant to the terms and conditions in that agreement since that time. Under that agreement, the Member Agencies have shared fire services, allowing for cost savings and operational efficiencies in providing fire services to the public.

Consolidation of such fire services into a single public entity has allowed for an efficient fire protection organization significant command and administrative benefits, and a net-decrease in operational costs with a concurrent increase in operational efficiency.

F. The Oceano Community Services District was previously a member of the JPA, but voluntarily exited the JPA in June 2023 due to an inability to meet its contribution obligations under the JPA.

G. The Member Agencies have now determined the specific terms of the 2010 agreement should be amended so that this Amended and Restated Joint Powers Agreement accurately reflects the Authority's current structure and operations.

65501.00001\41161259.18
NOW, THEREFORE, for and in consideration of the mutual covenants and conditions hereinafter stated the Member Agencies agree as follows:

1. Recitals. The recitals above are true and correct, and are hereby incorporated into the terms of this Agreement as though fully set forth herein.

2. Term. The term of this Agreement shall commence as of the date the Member Agencies have fully executed this Agreement and continue until terminated pursuant to the terms of this Agreement.

3. Definitions. Except where the context otherwise clearly requires, the following words and phrases shall have the meanings specified below:
“Act” shall mean the Joint Exercise of Powers Act of the State of California, commencing with California Government Code Section 6500, as now existing or as may hereinafter be amended or supplemented.
“Agreement” shall mean this Joint Exercise of Powers Agreement by and between the Member Agencies, as supplemented, amended and/or restated from time to time. “Authority” shall mean the Five Cities Fire Authority, a joint powers authority created by this Agreement in accordance with the Act, made up of the Member Agencies, the Cities of Arroyo Grande and Grover Beach.
“Authority Area” means that geographic area encompassing the total combined jurisdictional boundaries of the Member Agencies, as lawfully changed from time to time. “Board” or “Board of Directors” means the governing body of the Authority as established by this Agreement.
“Board member” or “Director” means a member of the governing body of the Authority. “Fiscal Year” means July 1 of one year through June 30 of the following year. “Formation Date” means the date when the Authority was originally created, June 7, 2010.

4. Creation of Authority.

4.1 Authority Created. The Authority was created as a public entity on June 7, 2010 as the “Five Cities Fire Authority” by operation of the prior Joint Powers Authority agreements.

The Authority was and is formed pursuant to the provisions of Article 1, Chapter 5, Division 7, Title 1 (commencing with Section 6500) of the Government Code of the State of California, which authorizes two or more public agencies, by a joint powers agreement entered into respectively by them and authorized by their legislative or governing bodies, to exercise jointly any power or powers common to the member agencies. The Authority shall be a public entity separate from the Member Agencies and is responsible for the administration of this agreement.

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The debts, liabilities and obligations of the Authority shall be the debts, liabilities and obligations of the Authority alone and not of one or more of the Member Agencies. (a) Confirmation of Authority Name. The Authority is known as the “Five Cities Fire Authority.”

4.2 Notices. Within thirty (30) days after execution of this Amended and Restated Agreement, the Authority shall cause a notice of such amendment to be prepared and filed with the office of the California Secretary of State containing the information required by California Government Code § 6503.5. Within ten (10) days after execution of this Amended and Restated Agreement, the Authority shall cause an amended statement of information concerning the Authority, as required by California Government Code § 53051, to be filed with the office of the California Secretary of State and with the County Clerk, of any change in facts as required by Government Code § 53051(a).

4.3 Authority Area. The geographic boundaries of the Authority (“Authority Area”) shall be coextensive with those of the Member Agencies, as lawfully changed from time to time.

4.4 Other Joint Powers Agreements Superseded. As of the Effective Date of this Agreement, any prior JPA agreements and/or amendments of the Five Cities Fire Authority shall have no further force and effect. Notwithstanding the foregoing, nothing in this Agreement supersedes the obligations, or otherwise absolves the former member agency of the Authority, Oceano Community Services District, of its ongoing share of unfunded CalPERS liabilities, including but not limited pension/CalPERS, accrued fringe benefits, and other liabilities incurred from Oceano’s participation in the Five Cities Fire Authority, prior to June 30, 2023 (“Liabilities”). The Authority shall enter into a standalone agreement with Oceano Community Services District with respect to those ongoing Liabilities.

4.5 Bylaws. The Board may adopt bylaws and any other regulations, policies, or procedures for the operation of the Authority not inconsistent with State constitutional, statutory, or decisional case law or the California Code of Regulations.

4.6 Purpose. The purpose of this Agreement is to jointly exercise fire protection, emergency medical, and related services. The purpose shall be accomplished, in the manner set forth in this Agreement. The Member Agencies each possess the powers necessary or convenient for the accomplishment of such purposes.
(a) Through the Authority and its governing body, the Member Agencies shall collaborate, cooperate and seek to determine ways in which the Member Agencies and the citizens residing within the Authority Area can benefit from joint services. (b) The Authority shall provide fire protection, emergency medical, and related services within the Member Agencies.
(c) The Member Agencies shall jointly benefit through the sharing of resources, which may include but is not limited to the sharing of executive and/or administrative staff. Among other public benefits, the Member Agencies shall receive reduced costs and more efficient services through the sharing of such resources.

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(d) The purposes of this Agreement shall not be construed as limiting, and the Authority, and the Board shall be authorized to further define the means by which the joint exercise of services may be accomplished.
(e) The Authority may, if approved by the Member Agencies, accept new Parties to this Agreement, and the purposes of this Agreement shall include the provision of fire protection, emergency medical, and related services within the territorial jurisdiction of any new Parties. The purposes of this Agreement shall apply to any new Parties.

5. Powers of Authority.

5.1 The Authority shall exercise the powers common to the Member Agencies, powers otherwise permitted under the Act, and powers necessary to accomplish the purposes of this Agreement.

5.2 The Authority is hereby authorized, in its own name, to do all acts necessary, convenient and appropriate for the exercise of the foregoing powers for the purposes set forth in this Agreement and to do any or all of the following:
(a) Setting and adopting policies, including the scope of the Management Committee’s authority under Section 7.1.
(b) Adopting an annual budget.
(c) Employing personnel, consultants, advisors and independent contractors, setting parameters for labor negotiations, and ratifying labor agreements. (d) Entering into contracts, leases and other agreements, which may include, but are not limited to, a contract for administrative and fiscal services and a contract with a Certified Public Accountant for annual audit services or mutual aid or automatic response agreements or contracts for service to other jurisdictions. (e) Applying for; receiving and disbursing grants, loans or other aids from any private or public agency.
(f) Setting fees for service where permitted by law.
(g) Receiving, disbursing and investing funds.
(h) Purchasing and holding title to property, and obtaining leaseholds, licenses, and other interests in property, including the authority to acquire, dispose of, construct, manage, maintain or operate any building, works or improvements. (i) Issuing revenue bonds pursuant to California Government Code Section 6540, et seq.
(j) Obtaining in its own name all necessary permits, licenses, opinions and rulings.

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(k) Expending funds of the Authority only for the purpose of carrying out the provisions of this Agreement as they now exist or may hereafter be amended. Such powers shall be exercised in the manner provided in the Act subject only to such restrictions as set forth in this Agreement or other applicable law.
(l) Suing and being sued in its own name.
(m) Carrying out and enforcing all of the provisions of this Agreement. (n) To incur debts, liabilities or obligations, which do not constitute a debt, liability or obligation of any Member Agency.
(o) To receive gifts, contributions and donations of property, funds, services and other forms of assistance from persons, firms, corporations, and governmental entities, provided that the Authority consents to such gifts, contributions and donations. (p) To fix the compensation, if any, paid to the Board of Directors, Secretary, Treasurer, Controller and Attorney, in compliance with all applicable laws. (q) To prescribe the duties, compensation and other terms and conditions of employment of other agents, officers and employees.
(r) To adopt reasonable rules and regulations for the conduct of the day-today operations of the Authority. (s) To apply for, accept, receive and disburse grants, loans and other aid. (t) To invest money in the treasury, pursuant to Government Code section 6505.5, that is not required for the immediate necessities of the Authority, as the Authority determines advisable, in the same manner and on the same conditions as local agencies, pursuant to Section 53601 of the Government Code.
(u) To exercise any and all powers which are provided for in the Act and in Government Code section 6584 et. seq. including, without limitation Government Code section 6588, as they exist on the Effective Date of this Agreement or may hereafter be amended. (v) Other powers and duties incidental to those enumerated herein.

5.3 Manner of Exercise of Powers. The powers of the Authority shall be limited only by the terms of this Agreement, the Act, and applicable law, as amended from time to time. The laws of the State of California applicable and common to general law cities shall govern the Authority in the manner of exercising its powers common between the cities, subject to such restrictions as are applicable to the City of Arroyo Grande in the manner of exercising such powers, as required by Government Code section 6509.

6. Governance.

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6.1 Board of Directors. The Authority shall be governed by a four-member Board of Directors (collectively “Board,” individually “Board member” or “Director”). Each Member Agency may appoint Board members, as follows: two (2) elected city councilmembers, which may but is not required to include the Mayor from each Member Agency. Each of the four (4) Authority Board members, and any alternates, shall be appointed as determined by the respective Member Agencies’ City Councils and any applicable local policies. All the power and rights of the Authority shall be exercised by the Board, subject to the rights reserved by the Member Agencies as set forth in this Agreement; provided, however, that the Board may delegate such powers and authority to committees, sub-committees, the Management Committee, and others as the Board deems appropriate.

6.2 Compensation. Directors may receive such compensation from the Authority for services as may from time to time be established by the Board, subject to the limits of applicable law. Directors shall be reimbursed for necessary and actual expenses incurred in the conduct of the Authority’s official business as permitted by law and by policies adopted by the Board.

6.3 Board Officers, Alternating Member Agency Term. In the interest of full representation between the two Member Agencies, the role of Board Chair and Vice Chair shall alternate between the two Member Agencies as follows:
(a) A Board member from one of the two Member Agencies shall serve as Board Chair over a one-year term (“Chair Term”). During each Chair Term, the Vice Chair shall be selected from a different Member Agency than that of the Board Chair, ensuring the Vice Chair serves a city council that is not part of the City organization on which the Board Chair serves.
(b) Following each one-year Chair Term, the Chair and Vice Chair shall alternate between the two Member Agencies, so at all times the Board Chair and Vice Chair shall be from the separate Member Agencies.
(c) The Chair, or in the Chair’s absence the Vice Chair, shall preside at and conduct all meetings of the Board and execute agreements and other official instruments on behalf of the Authority. In the absence or inability of the Chair to act, the Vice Chair shall act as Chair. In the absence of the Chair and the Vice Chair, the absent members may appoint a different member of the Board to serve as an alternate. (d) The procedure for selecting the Board Chair and Vice Chair shall be set forth within the Authority’s adopted by-laws or other adopted Authority policy as soon as practical.

6.4 Meetings of the Board.
(a) Annual Meeting. The Board shall hold an annual meeting to review the services provided by the Authority and to consider approval of a budget, which shall be a regular meeting conducted in accordance with the provisions of the Ralph M. Brown Act, Sections 54950 et seq. of the California Government Code. The Board shall also hold regular meetings at least quarterly, on a schedule adopted pursuant to subsection 6.4(d) below. The Board may hold additional regular meetings as determined by the Board and may adopt such procedures and

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resolutions for conducting such meetings and other business as the Board deems appropriate.

Alternatively the Board may establish an executive or other committee to hold regular meetings. (b) Conduct of Meetings. All meetings of the Board including, without limitation, regular, adjourned regular, and special meetings shall be called, noticed and conducted in accordance with the provisions of the Ralph M. Brown Act, Sections 54950 et seq. of the California Government Code.
(c) Quorum. A simple majority of the Board shall constitute a quorum for the purpose of transacting business. The affirmative vote of a majority of the quorum shall be required for the Authority to take any action and must include at least one affirmative vote from one Board member from each Member Agency, except: (i) where different voting requirements are provided for by applicable law or local Authority policies; and (ii) approval of budgets, issuance of any bonds, exercise of eminent domain, and incurrence of any debts, liabilities, obligations, certificates of participation or other evidence of indebtedness shall require an affirmative vote of the majority of the membership of the Board subject to any specific, adopted or applicable Authority purchasing policy. This section shall not prohibit the Board from delegating the authority to purchase goods and services, including goods and services consistent with any adopted or applicable Authority purchasing policy, specified herein. (i) In the absence of a quorum at any meeting of the Board, a majority of the directors present, or the Chair in the absence of all directors, or the secretary may adjourn the meeting from time to time without further notice, but no other business may be transacted. (d) Location and Date. The Board shall meet at the Principal Governance and Business Office as set forth in Section 9 of this Agreement, or at such other place as may be designated by the Board for its regular, adjourned regular, and special meetings consistent with this Agreement. The dates upon which, and the hour and place at which, any regular meeting shall be held shall be fixed by resolution of the Board and a copy of such resolution shall be provided to each Member Agency.
(e) Agendas and Minutes. The Board may select, appoint, or employ a secretary to keep or cause to be kept, at the principal business office, the principal governance office, or such other place as the Board may order, a book or electronic copy of minutes of all meetings of the Board and its committees as required by law, with the time and place of holding, whether regular or special, the notice thereof given, the names of those present at the meetings, and the proceedings thereof. As soon as practicable after each meeting, the secretary shall cause a copy of the minutes to be forwarded to each director of the Board, and to the Member Agencies. The secretary need not be a director and shall serve at the pleasure of the Board.

6.5 Board Committees
(a) Committees. The Board may create any standing or ad hoc committees as it sees fit. The Board may delegate to any committee the authority to approve any action or transact any business of the Board, except for business that is required by this Agreement to be approved by the full Board.

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(b) Actions of Full Board. Approval of budgets, issuance of any bonds, exercise of eminent domain, and incurrence of any debts, liabilities, obligations, certificates of participation or other evidence of indebtedness as may be set forth in the Authority’s effective purchasing policy and any legislative actions as defined by State law shall require an action of the full Board and shall not be delegated to any Board committees. (c) Procedures. Except for exempt ad hoc committees, all meetings of committees including, without limitation, regular, adjourned regular, and special meetings shall be called, noticed and conducted in accordance with the provisions of the Ralph M. Brown Act, Sections 54950 et seq. of the California Government Code. Committees shall maintain minutes of their proceedings.

6.6 Bylaws. The Board may adopt bylaws and any other regulations, policies, or procedures for the operation of the Authority.

7. Executive Officers and Personnel

7.1 Management Committee. The management of the Authority shall vest in a Management Committee made up of the current City Manager for both Member Agencies or the City Managers of any Member Agencies added to this Agreement. The Management Committee shall be participants in, and oversee all non-Management Committee Executive Officers, and any Executive Officers’ responsibilities as set forth in this Agreement. The Management Committee shall have the power, subject to any Board direction or Board-adopted policies:
(a) To execute any contract up to an amount consistent with any ordinance or rules adopted by the Board establishing the Authority’s purchasing policies and procedures, and/or policies for capital costs of special services, equipment, materials, supplies, maintenance, or repair that involves an expenditure by the Authority within budgetary limits approved by the Board (“Board purchasing policies”);
(b) To hire, terminate, and oversee the performance of the Fire Chief; (c) To expend funds of the Authority subject to any Board purchasing policies and enter into contracts, whenever required for the immediate preservation of the public protection, health, or safety;
(d) To sell any personal property of the Authority up to a value consistent with the Board’s purchasing policies;
(e) To support the Board as determined by the Board in labor negotiations and management;
(f) To administer the priorities and policies established by the Board for fire services of the Authority;
(g) To perform such other duties as may be assigned by the Board, and to report at such times and concerning such matters as the Board may require.

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7.2 Executive Officers. The executive officers of the Authority shall include the Management Committee, the Chief Executive Officer, the Fire Chief, the Treasurer, the Auditor/Controller, and such other executive offices as created by the Board. All executive officers shall report to the Management Committee, and the acting Chief Executive Officer. (a) Chief Executive Officer. The Chief Executive Officer will be the City Manager from the Management Committee that is employed by the same Member Agency from which the current Board Chair serves as a city councilmember or Mayor. The Chief Executive Officer shall alternate automatically, serving during the same Chair Term that the Board Chair serves on the Chief Executive Officer’s Member Agency city council. The Chief Executive Officer shall carry out the decisions of the Management Committee and act as the signatory for the Authority on all actions requiring approval of the Management Committee. (b) Fire Chief. The Fire Chief shall be responsible for the proper and efficient operation of the Authority as is or hereafter may be placed in his or her charge, or under his or her jurisdiction or control, pursuant to the provisions of this Agreement, or of any ordinance, resolution, bylaw or minute order of the Board. The Management Committee shall appoint and oversee the performance of the Fire Chief. The Fire Chief, as an at will employee of the Authority, shall report to the Management Committee and Chief Executive Officer, and by extension the Board, on all of the following, in a manner prescribed by the Board in consultation with the Management Committee:
(i) Plan, coordinate, supervise, and evaluate the Authority’s operations, and conduct day-to-day operations of the Authority; (ii) Supervise and manage Authority fire personnel;
(iii) Coordinate and supervise training of fire personnel; (iv) Make recommendations to the Management Committee and Board on Authority operations;
(v) Establish policies and procedures of the Authority to implement directives from the Board and the Management Committee; (vi) In conjunction with the Treasurer, prepare an annual budget for submission to the Management Committee and the Board;
(c) Treasurer. The Director of Administrative Services of Arroyo Grande shall be the Authority Treasurer. The Authority Treasurer shall perform such duties as are set forth in this Agreement and any other duties specified by the Board or as required by the Act, and shall perform the duties specified in Government Code sections 6505 and 6505.5, as amended from time to time. The Authority Treasurer shall be the depositary of funds and shall have custody of all money of the Authority, from whatever source. (i) The Board may at any time select, employ, or appoint a new or different Authority Treasurer who shall be: (1) the Treasurer or Finance Director of one of the Member Agencies; (2) a certified public accountant; or (3) such other officer or employee of one

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of the Member Agencies as the Board shall deem qualified to act as the Authority Treasurer, so long as permitted by law.
(d) Auditor/Controller. The Authority Auditor or Authority Controller shall be the same officer or employee of the City serving as the Authority Treasurer. The Authority Auditor or Authority Controller shall perform such duties as are set forth in this Agreement and any other duties specified by the Board or as required by the Act. (i) The Board may at any time select, employ, or appoint a new or different Authority Auditor or Authority Controller who shall be: (1) the auditor or controller of one of the Member Agencies; or (2) such other officer or employee of one of the Member Agencies as the Authority shall deem qualified to act as Authority Auditor or Authority Controller, so long as permitted by law.
(e) Secretary. The Board shall appoint, or designate to the Management Committee in consultation with the Fire Chief to appoint a Secretary who shall serve at the pleasure of the Board. The Secretary shall be the official custodian of records for the Authority, make all filings requested by the Board and legally required, and be responsible for agendas and meeting minutes as provided in Section 6.4(f) of this Agreement.

7.3 Official Bond. Pursuant to Government Code section 6505.1, the public officer, officers or persons who have charge of, handle or have access to any property of the Authority shall file an official bond in an amount of $25,000, unless fixed by the Parties to this Agreement in a different amount by unanimous decision of the Board.

7.4 Other Officers and Staff
(a) Attorney for Authority. The Attorney for the Authority shall be appointed by the Board of Directors. The Attorney for the Authority or a designated deputy shall attend all meetings of the Board of Directors; provided, however, that the absence of the Authority Attorney shall not affect the validity of any meeting. The Attorney shall perform such other duties the Board of Directors specifies.
(b) Officers and Professional Services. The Board may select, appoint, or employ any other officers, or professional and expert services as may be necessary or appropriate to accomplish the purposes of this Agreement, including but not limited to, legal counsel, financial consultants, accountants, engineers, architects, contractors, appraisers and any other consultants and advisors, which may be a corporation, partnership, firm or individual. The Board may delegate to the Fire Chief or to a committee the authority to hire officers and professional services.
(c) Employees of Authority. Employees of the Authority are (i) those individuals employed by Arroyo Grande, but assigned to the Authority between the Authority and Arroyo Grande referenced in Exhibit A of this Agreement; and (ii) those individuals employed directly by the Authority. The Parties’ governing bodies may meet in closed sessions for the purpose of providing input to the Board regarding the terms of compensation for Authority employees.

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(d) Shared Resources. The Board may contract with a Member Agency, or its officers, to provide necessary administrative services to the Authority as appropriate. All personnel employed by the individual Member Agencies shall remain employees of their respective Member Agency unless and until the Authority affirmatively employs such personnel pursuant to its powers. No express or implied employment contract between any Member Agency employee and the Authority exists as a result of this Agreement.

7.5 Interference Prohibited. The Board and the Member Agencies shall deal with the administrative services of the Authority (which includes the Authority’s Treasurer, Auditor/Controller and Secretary) only through the Management Committee who may delegate to the Fire Chief and their responsibility set forth herein, except for the purpose of inquiry.

Neither the Board, the governing body of any Member Agency, nor any individual members of either shall give orders to any subordinate of the Fire Chief.

7.6 Rules and Regulations. The Board shall forthwith adopt rules and regulations and perform all other acts necessary so that the Authority may hire personnel. Existing personnel operations remain in effect and control at the time this Agreement takes effect, until such time that the Board adopts rules and regulations that augment those existing personnel operations.

8. Equipment and Facilities.

8.1 Fire Stations and Other Real Property
(a) Member Agency Buildings and Structures. Buildings and structures owned by Member Agencies may be utilized for the Authority’s use, but shall remain the property of the respective Member Agency. Each Member Agency shall be responsible for the maintenance and insurance of Member Agency buildings. The Authority shall not directly own, maintain, or insure any existing building or structure, unless the Authority and a Member Agency expressly agree in writing that the Authority accepts ownership, responsibility for maintenance, or responsibility to insure a particular building or structure. Any building constructed or owned by the Authority after the Formation Date shall be the property of the Authority, and in the event of dissolution of the Authority, shall be disposed of as provided in this Agreement. (i) Maintenance By Members. The respective Members owning a fire station shall be responsible for the maintenance, repair, replacement, and improvements to the building structure, mechanical systems, electrical, plumbing, and exterior infrastructure (i.e., roof coverings, driveway, etc.). The Members are not responsible for (i) the maintenance or repair of any systems that have been installed by the Authority and are unique to fire service operations (e.g., dispatch/radio systems, computer networks, etc.), and (ii) the cost of performing any such maintenance or repairs caused by the negligence of the Authority or its employees, agents, servants, licensees, contractors, or invitees.
(ii) Maintenance By Authority. The Authority shall be responsible for routine maintenance of fire stations, interior decorating, landscaping, and fire alarm systems. The Authority is also responsible for the maintenance, repair, replacement, and improvements of the dispatch telecommunication systems and all systems that have been installed by the Authority

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which are unique to fire service operations (e.g., dispatch/radio systems, computer networks, etc.).
(b) Contributions of Real Property. Either Member Agency may contribute real property to the Authority for the Authority’s use. The Member Agency owning the interest in the real property shall continue to own said interest, unless the Member Agencies and Authority agree otherwise. The Board and the Member Agency owning the interest shall agree on the terms of the contribution.
(c) Lease or Purchase of Additional Stations. The Authority shall be authorized to lease, purchase, or obtain any other interest in real property for the Authority’s uses.

8.2 Equipment and Other Personal Property
(a) Equipment Provided by Member Agencies. As soon as reasonably practicable, the Authority shall inventory all equipment owned by the Member Agencies that is available for the Authority’s use. All Member Agency equipment shall remain the property of that Member Agency, unless the Member Agencies otherwise agree. The Member Agency may contribute additional equipment for the Authority’s use upon terms agreed between the Member Agencies and the Authority. The Authority may rent or borrow equipment from the Member Agencies for temporary use. All equipment owned by the Authority or subject to an equipment lease for financing purposes, shall remain the property of the Authority. (b) Acquisition of Equipment. The Authority may acquire any equipment or other personal property for the Authority’s use.

8.3 Separate Property of the Parties. Exhibit C, attached and incorporated by reference, establishes the property which is owned by a Member Agency and not the Authority, notwithstanding that the Authority may use that property.

9. Principal Offices.

9.1 Principal Governance and Business Office. The principal business office and governance office of the Authority at the date this Agreement is effective shall be Authority’s Station 1, at 140 Traffic Way, Arroyo Grande, California, 93420, (“Principal Governance and Business Office” or “Principal Office”) or as otherwise determined by the Board. The Board may change the Principal Office, from time to time, and from one location to another, within the Authority Area. Any change shall be noted by the Authority Secretary and reflected in Authority document, but shall not be considered an amendment to this Agreement.

10. Financial Provisions.

10.1 Administrative services shall be provided by, and allocated between the Member Agencies as shown on Exhibit A, attached and incorporated by reference to this Agreement.

10.2 Operation and capital improvements costs shall be allocated among the jurisdictions in accordance with the cost-sharing formula in Exhibit B, adopted by the Board and

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the governing bodies of the Member Agencies, and attached and incorporated by reference into this Agreement.

10.3 Member Agencies will be billed quarterly by the Authority Treasurer, in accordance with the provisions of Exhibit A and B. Member Agencies agree to pay the invoices on a quarterly basis.

10.4 Capital Purchases. Capital purchases that solely benefit a Member Agency shall be funded by that Member Agency. All other capital purchases shall be funded on terms established by the Board. The funding of capital purchases that are not budgeted shall be separately approved by each Local Sub-Committee.

10.5 Budget.
(a) The Board shall initially adopt a budget within 30 days of execution of this Amended and Restated JPA. The Board shall adopt a budget for maintenance and operation costs, and costs of special services in time to allow review by the Member Agencies prior to April 30th of each fiscal year. The Authority’s fiscal year shall be July 1 to June 30. Each Member Agency shall prepare its own annual budget for capital costs related to Authority services. Subject to the exception provided below in Section 10.5(b), no expenditures may be made by or on behalf of the Authority unless authorized by a budget or budget amendment approved by the Board.

10.6 Invoicing. Upon completion of the initial budget, and thereafter at such other intervals as determined appropriate by the Board, the Authority shall determine the amount of the budget expenses payable during the ensuing period pursuant to each Member Agency’s share of expenses required by this Agreement, and the budget approved by the Board. The Authority shall submit to each Member Agency an invoice showing the Member Agency’s share for the applicable period together with a calculation of the Member Agency’s share. Each Member Agency shall pay to the Authority the amount invoiced within 30 days after the date of the invoice. Any amount not paid within 60 days of the date of an invoice shall be delinquent.

10.7 Default and Delinquency. Any Member Agency which defaults in its obligation to pay or advance any amounts due pursuant to this Agreement after such amounts have become delinquent shall be deemed to have waived and relinquished any rights and benefits it may have under this Agreement. Any defaulting Member Agency shall be liable to the Authority for interest on the unpaid amount at the rate of 10% per annum, or the maximum rate allowed by law if it is less than 10% per annum, until the overdue invoice amount is paid in full. If the Agreement is terminated, then the defaulting Member Agency shall remain liable for payment of its share of debts, liabilities and obligations under this Agreement incurred prior to the date of termination, plus interest.

10.8 Accounting. The Authority shall maintain strict accountability of all funds, receipts and expenses, and shall keep and maintain appropriate records and accounts of all funds, receipts and expenses under this Agreement in accordance with generally accepted accounting practices for California public agencies and the requirements of the Act. The Authority shall

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allow any Member Agency, or any of its employees, accountants, attorneys or agents to review, inspect, copy and audit any such records and accounts.

10.9 Record of Contributions. The Authority shall maintain records of all fire prevention and suppression equipment, medical equipment, and associated property and assets contributed by each Member Agency and by the Authority, including any staff resources contributed to the Authority.

10.10 Audit. The records and accounts of the Authority shall be audited annually by an independent certified public accountant and copies of such audit reports shall be filed with the State and each Member Agency pursuant to the requirements of Section 6505 through 6505.6 of the Government Code. The audit shall conform to generally accepted auditing standards. Such report shall be filed within 12 months after the end of the fiscal year or years under examination, and no later than fifteen (15) days after receipt of such audit reports by the Authority.

10.11 Expenditures. The Board shall establish and comply with a system and procedure for the review and approval of Authority expenditures and claims and the drawing and signing of Authority warrants or checks. All expenditures shall be consistent with the approved budget, except as otherwise determined by the Board.

11. Debts, Liabilities, Obligations. Subject to all applicable laws, including but not limited to Government Code section 6508.1, all debts, liabilities, and obligations of the Authority shall be those of the Authority, and do not constitute debts, liabilities, or obligations of any one or more of the Member Agencies. The responsibilities and obligations of each Member Agency to this Agreement shall be solely as provided in this Agreement, or as provided in supplemental agreements or amendments as shall be executed by the Member Agencies. As required by law, the Member Agencies are liable for CalPERS liability of the Authority as follows:

11.1 The Authority shall use the City of Arroyo Grande’s CalPERS contract for Employees of the Authority.

11.2 If a Member Agency withdraws from the Authority, the withdrawing Member Agency shall be liable for, and upon demand shall promptly pay, its share of the existing and/or contingent liabilities of the Agency as of the effective date of the withdrawal. The withdrawing Member Agency’s share of liabilities shall bear the same relationship to the whole as its annual contribution for the operation of the Authority bears to the whole of all annual contributions.

11.3 If a Member Agency withdraws from the Authority, but the Authority does not dissolve or terminate, and the Authority has established a plan of periodically paying down part of its unfunded accrued pension liability (“UAPL”) debt to CalPERS, the withdrawing Member Agency shall continue to be liable, and to promptly pay thereafter to Authority upon being billed, its share of the Authority’s UAPL based upon its prior years of membership. The withdrawn Member Agency’s share of such UAPL expense shall be the determined according to the same formula used by the Authority to allocate such costs during the final year of the withdrawing Member Agency’s membership.

11.4 The withdrawing Member Agency shall also be liable for any additional Authority expenses as of the effective date of the withdrawal that exclusively benefit the

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withdrawing Member Agency as well as 100% of any early termination fees that accrue due to the withdrawal of the Member Agency.

11.5 Until such time that the Authority utilizes a different contract approved by its Board, if the City of Arroyo Grande dissolves, terminates, or ends its contractual relationship with CalPERS(“the triggering events”), Government Code sections 6508.1 and 6508.2 will require all existing Member Agencies, and certain past Member Agencies, to each assume individual financial responsibility for its proportionate share of the UAPL then in effect. By joining Authority, each Member Agency promises and represents that upon occurrence of a triggering event: (i) it will undertake this obligation when requested by either CalPERS or the Authority; and (ii) that unless the Board determines differently, the proportionate share each Member Agency will assume shall be based upon the same formula used to determine each Member Agency’s share of the Authority’s last periodic UAPL payment to CalPERS in the year prior to the triggering event.

11.6 Prior to Execution. The debts, liabilities and obligations of each Member Agency in existence or accrued as of the full execution of this Agreement shall remain the debts, liabilities and obligations of that Member Agency and shall not be assumed by or transferred to the Authority. After the execution of this Agreement by both Member Agencies, however, any existing debt, liability or obligation of the Member Agencies may be expressly approved or accepted by the Authority by a formal written action of the Board.

11.7 Fire Engines 2 and 3, Equipment Lease Payments. Notwithstanding any other provisions of this Agreement to the contrary, the Parties mutually agree and understand that as a result of any dissociation, withdrawal or termination of this Agreement by a withdrawing member agency, that withdrawing member agency will not be obligated for future payment lease obligations for Engines 2 and 3 that remain in the custody, control, and possession of the Authority.

12. Indemnity and Hold Harmless; Insurance.

12.1 Indemnification of Member Agencies. The Authority shall indemnify, defend and hold harmless the Board of Directors, the individual Member Agencies, and their members, officers, directors, employees and agents from and against any and all liability, loss, damages, expenses, costs (including, without limitations, costs and fees of litigation or arbitration) of every nature, arising out of any act or omission related to this Agreement, any individual Member Agency, or their members, officers, directors, employees and agents.

12.2 Indemnification for Prior/Separate Acts. Each Member Agency (Indemnifying Member Agency) shall defend, indemnify and hold harmless the Authority, each Director, the other Member Agency, and the Authority and each Member Agency’s respective Council or governing board members, officers, agents and employees, from any and all claims, losses, damages, costs, injuries and liabilities of every kind, including attorney’s fees and expert’s fees, arising directly or indirectly from the Indemnifying Member Agency’s acts or omissions occurring prior to the effective date of the Authority’s initial Effective Date of June 7, 2010, or that otherwise occur outside the scope of this Agreement.

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12.3 Insurance. The Authority shall acquire insurance protection as is necessary to protect the interests of the Authority and the Member Agencies. The premiums for insurance acquired by the Authority, as well as any anticipated funds necessary to pay for self-insured retentions and deductibles for insurance, shall be determined based upon actuarial studies and included in the budget. Any adjustments to the budget to pay for insurance premiums, selfinsured retentions, and deductibles shall be prepared by the Management Committee for presentation to the Board of Directors for consideration and approval.

12.4 Survival. These defense, indemnification, and hold harmless obligations shall survive and continue in full force and effect after withdrawal of any Member Agency from this Agreement or termination of this Agreement for any reason with respect to any negligent acts, errors or omissions that occurred before the date of such withdrawal or termination.

13. Termination.

13.1 Termination.
(a) When there are only two Member Agencies in the Authority, either Member Agency may unilaterally terminate the Agreement with an effective termination date of June 30 of any Fiscal Year, provided that written notice is provided to, and received by, the Authority and the other Member Agency by the terminating Member Agency no later than June 30 of the prior Fiscal Year, as expressed by vote of the governing body of the terminating Member Agency. Any terminating Member Agency shall be obligated to pay that Member Agency’s contributions for the Fiscal Year ending on the effective date of termination. (b) The Member Agencies may all jointly agree by written consent to terminate the Agreement, as expressed by resolution of the governing boards of all Member Agencies (passed by vote of the membership of the governing body of each Member Agency).

Such termination shall provide for adequate time to wind-up the affairs of the Authority and distribute any assets pursuant to this Agreement. The Member Agencies shall be obligated to pay their contributions until the effective date of termination.

13.2 Disposition of Member Agencies’ Property Upon Termination. Any property that was acquired by either Member Agency prior to entering this Agreement, and that is required either by this Agreement or by any subsequent act or Agreement to remain the property of the Member Agency, shall be returned to the Member Agency upon termination of this Agreement.

Exhibit C lists the separate property of the Member Agencies, but a Member Agency may prove that it, and not the Authority, owns certain property by providing documentation establishing such ownership. If property is not listed in Exhibit C, and no documentation establishes ownership of that property, the property will be presumed to be owned by the Authority.

13.3 Disposition of Authority Property Upon Termination. Upon termination of this Agreement, the assets and property of the Authority shall be distributed as follows:
(a) First, if either Member Agency is in default of its obligation to pay or advance any amounts due to Authority pursuant to this Agreement, then any funds or assets of

65501.00001\41161259.18
the defaulting Member Agency shall be applied to the Authority in satisfaction of any such delinquency.
(b) Second, any other funds on hand shall be used to liquidate and wind-up the affairs of the Authority.
(c) Third, any surplus funds on hand remaining after satisfaction of subsections (a) and (b) above shall then be returned to the Member Agencies in proportion to their proportional financial contributions made to the Authority. (d) Fourth, any property acquired by either Member Agency prior to entering this Agreement shall be returned to the Member Agency which owned the property at the Formation Date; provided, however, that if any such property has been substantially improved, repaired or modified by Authority funds, it shall be distributed pursuant to subsection (e) below. (e) Fifth, any remaining property and assets shall be divided and distributed amongst the Member Agencies pursuant to separate agreement of the Member Agencies entered into at that time. If such subsequent agreement is not successfully negotiated and agreed to within a reasonable period of time, then the remaining property and assets shall be sold and the net proceeds from any sale shall be distributed among the Member Agencies in proportion to their financial and equipment contributions made to the Authority during the operation of this Agreement and any ancillary agreements.

14. Conflict Resolution. The Member Agencies agree that any and all disputes, claims or controversies between the Member Agencies arising out of or relating to performance of this Agreement, shall be resolved pursuant to the conflict resolution provisions as follows:

14.1 The Member Agencies shall first meet and attempt in good faith to negotiate and resolve any dispute arising out of or relating to this Agreement, subject to subsequent approval of any such resolution by the respective governing boards. The Member Agencies may, in each Member Agency’s respective discretion, appoint either an alternative representative of the governing body or an ad hoc committee constituting less than a quorum of the governing body to meet and attempt in good faith to negotiate and resolve any dispute arising out of or relating to this Agreement, subject to subsequent approval of any such resolution by the respective governing boards.

14.2 If the matter is not resolved by negotiation pursuant to Section 14.1 above, then the Member Agencies agree that the matter shall be submitted to mediation within a reasonable period of time after receipt of a written request from one Member Agency to the other Member Agency requesting such mediation. The Member Agencies shall cooperate with one another in selecting a mediator and in scheduling the mediation proceedings. Should the Member Agencies be unable to agree upon a mediator, they shall agree upon a mediation service and shall have that service select a mediator for them. The Member Agencies agree that they shall participate in the mediation in good faith and that they will share equally in the costs of mediation. All offers, promises, conduct and statements, whether oral or written, made in the course of the mediation by any of the Member Agencies, their agents, employees, experts and attorneys, and by the mediator or any employees of the mediator, are confidential, privileged and inadmissible for any

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purpose, including impeachment, in any litigation or other proceeding involving the Member Agencies, provided that evidence that is otherwise admissible or discoverable shall not be rendered inadmissible or non-discoverable as a result of its use in the mediation.

14.3 If the matter is not resolved by negotiation pursuant to Section 14.1 above, or by subsequent mediation pursuant to Section 14.2 above, then the Member Agencies may submit the matter to binding or non-binding arbitration, but only if both Member Agencies agree to submit the particular controversy to arbitration. Neither Member Agency shall have a right to submit any controversy to arbitration without the other Member Agency’s consent.

15. New Members.

15.1 Addition of New Members. The Authority may set the terms and conditions for admitting new members (a “New Member Agency”) that it deems appropriate either by amendment to this Agreement or the Bylaws. New members may only be admitted with unanimous approval of the Board and the governing bodies of each Member Agency. Approved new Members shall execute a copy of this Agreement, as amended, and shall thereafter be subject to all terms and conditions contained herein.

15.2 Construction. The terms of this Agreement shall be construed so as to apply to new Members the same as to the initial Member Agencies to the Agreement. New Members shall have the rights and obligations accorded to “Members” or “Member Agencies (whether singular or plural) under this Agreement.

15.3 Cost Share. Prior to the acceptance of any New Member Agency, the proposed New Member Agency shall pay an amount, as determined by the Board, for the proposed New Member Agency’s fair share of any start-up costs or other initial investments incurred by the Authority to admit the New Member Agency.

15.4 Funding of Services. The Authority shall not provide any fire protection or related services within a New Member Agency’s geographic area unless and until the New Member Agency deposits sufficient funds to cover the estimated costs of services for a period of time as determined by the Board, to be not less than six (6) months.

16. Withdrawal. Notwithstanding any other provision of this Agreement, any Member Agency may withdraw from the Authority by providing the Authority with written notice of its intent to withdraw consistent with Section 13.1 of this Agreement, Termination. This includes providing written notice no later than June 30 of any Fiscal Year, a continuing obligation to pay that Member Agency’s contributions for the Fiscal Year ending on the effective date of termination, and following Section 13.1.b. for the procedure where the Members Agency may jointly agree by written consent on the withdrawal of a Member Agency. A withdrawal from the Authority constitutes a withdrawal of that Member Agency’s representatives from the Board of Directors.

17. Effect of Withdrawal. The withdrawal of a Member Agency shall not terminate its responsibility to contribute its share of any obligation incurred by the Authority, including amounts determined by the Board for (1) liabilities and claims accrued during the time the agency was a Member Agency or (2) budgeted expenses for the Fiscal Year in which notice of

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intent to withdraw is given. Except as the withdrawing Member Agency may agree, in writing, with the Board, the withdrawing Member Agency shall automatically relinquish all rights as a Member Agency under this Agreement, on the effective date of the withdrawal. Upon termination of this Agreement, a Member Agency that has withdrawn will be treated like all other Member Agencies for purposes of disbursement of Authority assets, unless otherwise agreed in writing and the remaining Member Agencies of the Authority can maintain the name “Five Cities Fire Authority.”

18. Conflict of Interest Code. The Authority adopts as it Conflict of Interest Code the Fair Political Practices Commission Model Conflict of Interest Code with appropriate substitution regarding references to the Board and Authority officers.

19. General Provisions.

19.1 Integration. This Agreement constitutes the sole, final, complete, exclusive and integrated expression and statement of the terms of this contract among the Member Agencies concerning the subject matter addressed herein, and supersedes all prior negotiations, representations or agreements, either oral or written, that may be related to the subject matter of this Agreement, except those other documents that are expressly referenced in this Agreement.

19.2 Headings. The section and subsection headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.

19.3 Consents. Whenever any consent and/or approval is required under this Agreement from any Member Agency, said consent and/or approval shall not be unreasonably withheld.

19.4 Construction and Interpretation. It is agreed and acknowledged by the Member Agencies that this Agreement has been arrived at through negotiation, and that each Member Agency has had a full and fair opportunity to revise the terms of this Agreement. Consequently, the normal rule of construction that any ambiguities are to be resolved against the drafting Member Agency shall not apply in construing or interpreting this Agreement.

19.5 Waiver. The waiver at any time by any Member Agency of its rights with respect to a default or other matter arising in connection with this Agreement shall not be deemed a waiver with respect to any subsequent default or matter.

19.6 Remedies Not Exclusive. The remedies provided in this Agreement are cumulative and not exclusive, and are in addition to any other remedies that may be provided by law or equity. The exercise by either Member Agency of any remedy under this Agreement shall be without prejudice to the enforcement of any other remedy.

19.7 Severability. The invalidity, illegality or unenforceability of any provision of this Agreement shall not render the other provisions unenforceable, invalid or illegal.

19.8 Successors and Assigns. Except as otherwise provided by law, the rights and duties of the Member Agencies under this Agreement shall not be assigned or delegated without

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the prior written consent of the other Member Agency. Any attempt to assign or delegate such rights or duties in contravention of this Agreement shall be null and void. Any approved assignment or delegation shall be consistent with the terms of any contracts, resolutions, indemnities and other obligations of the Authority then in effect, and may be subject to such additional reasonable conditions of approval imposed by the Member Agency approving the assignment or delegation.

19.9 No Third Member Agency Beneficiaries. This Agreement shall not be construed to create any third party beneficiaries. This Agreement is for the sole benefit of the Member Agencies, and their permitted successors, transferees and assignees, and no other person or entity shall be entitled to rely upon or receive any benefit from this Agreement or any of its terms.

19.10 Amendment. This Agreement may be modified or amended only by a subsequent written agreement approved by the governing board of each Member Agency and executed by both Member Agencies pursuant to the terms and conditions of this Agreement.

19.11 Governing Law and Venue. Except as otherwise required by law, this Agreement shall be interpreted, governed by, and construed under the laws of the State of California. The County of San Luis Obispo shall be the venue for any litigation concerning the enforcement or construction of this Agreement.

19.12 Attorney Fees. In the event any legal action is brought to enforce or construe this Agreement, the prevailing party shall be entitled to an award of reasonable attorney fees, expert witness and consulting fees, litigation costs and costs of suit.

19.13 Notice. Any notice, demand, invoice or other communication required or permitted to be given under this Agreement shall be in writing and either served personally or sent by prepaid, first class U.S. mail to the City Clerk and City Attorney of each Member Agency.

Any notice or other communication served by personal delivery shall be deemed received when actually delivered. Any notice or other communication shall be deemed as received three days after deposit in United States mail, postage prepaid, return receipt requested.

19.14 Counterparts. This Agreement may be executed by the Member Agencies in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument. [signature page follows]

65501.00001\41161259.18
IN WITNESS WHEREOF, the Member Agencies hereto have executed this Joint Exercise of Powers Agreement as of the date last executed as set forth below.

CITY OF GROVER BEACH
By
Mayor,
Dated
ATTEST:

By
City Clerk
APPROVED AS TO FORM:

City Attorney

CITY OF ARROYO GRANDE
By
Mayor
Dated
ATTEST:

By
City Clerk
APPROVED AS TO FORM:

City Attorney

65501.00001\41215817.1

EXHIBIT A

ADMINISTRATIVE SERVICES
Administrative services shall be provided to the Authority by the Members as follows:

1. Personnel. All personnel working for the Authority will be employed by the City of Arroyo Grande. Personnel, benefits, payroll, and workers compensation matters shall be administered by Arroyo Grande subject to a written agreement between the Authority and the City of Arroyo Grande. The City of Arroyo Grande shall assign all fire service employees on a full-time basis to carry out the functions of this Agreement.

Furthermore, under such written agreement, the City of Arroyo Grande will assign all of its responsibilities of the appointment, promotion, management, training, supervision, evaluation, discipline, and termination of employees as well as labor negotiations with represented employees to the Authority under the Authority’s chain of command and decision making process.

2. Finance. The City of Arroyo Grande shall provide financial services. Financial services shall include the provision of payroll, accounts payable, and accounts receivable services, as well as, any financial reporting and auditing services that may be required.

3. Information Technology. The City of Arroyo Grande shall provide information technology services. Information Technology shall include monitoring and maintaining the company computer systems, installation and configuration of hardware and software, and solving technical issues as they arise.

4. Indirect Contribution. Payment for the services as described in Exhibit A shall be the responsibility of the Member providing the services as referenced in Exhibit A. The payment for such services by said agencies shall be recognized as an indirect contribution made by the respective agency. All indirect contributions shall be recognized in the Authority's budget as a contribution from the respective agency and shall be deducted from the contributing agency's proportional allocation of costs for the operation of the Authority.

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EXHIBIT B

FUNDING FORMULA
Effective July 1, 2023, each Member Agency shall pay for the ongoing costs of the Five Cities Fire Authority according to the following formula to be calculated annually when the budget is prepared:

1. 58% of the total costs shall be paid by the City of Arroyo Grande;

2. 42% of the total costs shall be paid by the City of Grover Beach.

Any revenue received by the Authority, such as through a contract for service, reimbursements received for strike team deployment or automatic aid, grant funding, or fees for service, shall reduce the total costs that are then allocated to the Member Agencies according to the above formula.

The funding formula contained herein shall be reevaluated by the Member Agencies at least every two years, prior to the Member Agencies’ biennial budget adoption.

65501.00001\41215817.1

EXHIBIT C

INVENTORY OF SEPARATE PROPERTY OF THE

MEMBER AGENCIES
The following inventory of each Member Agency will become the property and responsibility of the Authority, including but not limited to maintenance, insurance, and replacement:

Arroyo Grande Grover Beach
Engine 6691 – 2007 Pierce Type I Engine Bauer Air-Fill Compressor – GB Station Rescue 6652 – 1996 E-One Rescue
Utility 6632 – 1995 Ford F-250 Pick-Up

65501.00001\41215817.1

EXHIBIT D
The following map identifies the service areas of the Member Agencies for the JPA.

Contractual services provided to areas outside of these Member Agencies are not depicted on this map.

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ATTACHMENT 2
1 AGREEMENT TO PROVIDE FIRE SERVICES

BETWEEN THE FIVE CITIES FIRE AUTHORITY AND

OCEANO COMMUNITY SERVICES DISTRICT
THIS AGREEMENT is made and entered into this ____ day of June 2023, (“Effective Date”) by and between the Five Cities Fire Authority ("FCFA"), a California Joint Powers Authority as authorized under Government Code Sections 6500 et. seq., and Oceano Community Services District ("Oceano"), a County of San Luis Obispo Community Services District (collectively referred to as "the Parties").

RECITALS
WHEREAS, the Parties are public entities organized and operating under the laws of the State of California; and
WHEREAS, the Parties have the authority to perform fire protection activities, certain emergency medical services and other related activities for their respective agencies, including those described within Exhibit “B” (collectively, “FCFA Services”); and
WHEREAS, since June 7, 2010, Oceano has been a member agency of the Five Cities Fire Authority along with the Cities of Grover Beach and Arroyo Grande; and
WHEREAS, FCFA’s Joint Exercise of Powers Agreement was amended by the Parties to terminate Oceano’s participation as a member agency in FCFA commencing July 1, 2023; and
WHEREAS, the Parties desire for FCFA to continue supplying fire and emergency medical services to Oceano for a temporary period of time consistent with the terms and conditions of this Agreement; and
WHEREAS, Oceano remains subject to all “Wind Down Period” obligations set forth within the Five Cities Fire Authority Amended and Restated Joint Powers Authority Agreement, and specifically Section 5 of the Third Amendment to the FCFA Joint Powers Agreement incorporated herein as Exhibit “C”, Oceano’s withdrawal from the FCFA shall not absolve Oceano from any Liabilities, defined to include but not limited to pension/CalPERS, accrued fringe benefits, and other liabilities incurred arising out of Oceano’s participation in the FCFA since the time the FCFA was created on June 7, 2010 through the date of Oceano’s withdrawal from the FCFA on June 30, 2023; and
WHEREAS, this agreement is entered into pursuant to Government Code § 54981 and § 55632.

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ATTACHMENT 2
2 AGREEMENT
NOW, THEREFORE, the above “WHEREAS” provisions are incorporated herein with the same force and effect as any other term and condition of this Agreement and for and in consideration of the mutual advantages to be derived therefrom, and in consideration of the mutual covenants herein contained, it is agreed by and between the Parties hereto as follows:

ARTICLE I

PROVISION OF SERVICES

1.1 Scope of Services. FCFA shall provide Fire and Emergency Medical Services within the jurisdictional area of Oceano. See jurisdictional map entitled Exhibit “A” incorporated by reference herein as if set out in full. "Fire and Emergency Medical Services" shall mean those services identified in Exhibit “B”.

1.2 Fire Chief. FCFA's Fire Chief or his/her designee shall be immediately available for response and management of emergency incidents as necessary to provide incident command and coordination functions within the jurisdictional boundaries of Oceano over the term of this Agreement.
1 . 3 Staffing. FCFA shall provide, in its sole discretion, sufficient staffing personnel, meeting minimum federal and state-mandated training requirements for their respective classifications and responsibilities, to provide Fire Services, pursuant to this Agreement, to Oceano for the term of this Agreement. The staff shall consist of personnel assigned at the sole discretion of FCFA but at least one member of every shift shall be qualified as an Emergency Medical Technician.

ARTICLE II

PAYMENT FOR SERVICES

2.1 Compensation for Services. Oceano shall compensate FCFA for all Fire and Emergency Medical Services performed under this Agreement in a fixed amount of One Million One Hundred Fifty Thousand Dollars ($1,150,000.00). Oceano shall pay, on a quarterly basis (every three months from the effective date of this Agreement) the sum of Two Hundred Eighty-Seven Thousand Five Hundred Dollars and Zero Cents ($287,500) for the Fire, Emergency Medical Services and any related FCFA Activities provided by FCFA. In the event the Fire, Emergency Medical Services and any related FCFA Activities are extended in accordance with Section 5.2, the compensation that FCFA will be willing to accept will be no less than the actual cost of service, in the amount or formula determined by FCFA that is presented to the County of San Luis Obispo for purposes of evidencing Oceano’s proportionate

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ATTACHMENT 2
3 share of the actual cost of service, which will be incorporated in this Agreement as a new Exhibit “D” during the sixty (60) day meet and confer period described in Section 5.2 below. FCFA shall submit quarterly invoices to Oceano for the quarterly payment amount. Payments are to be made within thirty (30) days of FCFA mailed invoice to Oceano, and any non-payment in excess of sixty (60) days from the date of FCFA’s mailed invoice shall be considered a default under this Agreement and shall accrue an additional ten (10) percent charge as described herein.

ARTICLE Ill

PROPERTY USED FOR FIRE SERVICES

3.1 Fire Station. FCFA will utilize the Fire Stations number 1 and 2 located respectively at 140 Traffic Way, Arroyo Grande and 701 Rockaway Ave. Grover Beach, California, as its primary locations for the provision of Fire, Emergency Medical Services and FCFA Activities contemplated by this Agreement. Oceano retains fee title to the Fire Station number 3, but hereby grants FCFA an unrestricted license for full use of the apparatus bay at Station number 3, located at 1655 Front Street, Oceano for general storage purposes in furtherance of this Agreement. Oceano shall also make available for FCFA training and storage, the well site no. 8 property located on South 13th Street. FCFA’s use of Station number 3 and well site no. 8 shall not be subject to any rental or other cost and shall be part of the consideration paid by Oceano for Fire, Emergency Medical Services and FCFA Activities rendered by FCFA to Oceano. Oceano agrees to maintain the Fire Station number 3 and well site no. 8, in a safe, habitable, and serviceable condition at all times.
(a) Nothing herein shall in any way limit Oceano's right to grant concurrent use of the Fire Station number 3 to any other party, that does not unreasonably interfere with FCFA’s use of the apparatus bay for storage. FCFA shall not unreasonably interfere with the use of the Fire Station for any other purposes by Oceano.
(b) If Oceano grants rights to a third party for concurrent use of the Fire Station number 3, Oceano shall take all reasonable steps to ensure that the third party does not interfere with the use of the Fire Station for FCFA storage purposes and shall provide FCFA at least ten (10) days advanced notice of the use granted to a third party.
(c) In addition to the license granted in Section 3.1 above and subsections (a) and (b), Oceano shall further grant full operational use of Fire Station No. 3 for emergency medical services and fire suppression including all fire suppression equipment, fire engines, housing and administrative services necessary to operate the fire station from the Effective Date of this Agreement to June 30, 2023.

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ATTACHMENT 2
4 3.2 Maintenance and Replacement. FCFA, consistent with the Amended and Restated Joint Exercise of Powers Agreement, dated ______, 2023, shall bear all costs to maintain, repair and replace all facilities, vehicles, equipment and apparatus owned by FCFA and designated for use in the Fire, Emergency Medical Services and FCFA Activities.

ARTICLE IV

RELATIONS OF PARTIES

4.1 Special Relationship. The Parties will agree this Agreement does not create a “special relationship” as the term is defined by Federal or California law, between Oceano or any other agency, or between the Parties’ officials, officers, employees, or successors or with any third party as a result of this Agreement.

Oceano does not participate nor is a member of FCFA and retains no rights or title in the FCFA Joint Powers Authority after June 30, 2023. Notwithstanding the foregoing, nothing within this Agreement absolves Oceano from obligations and/or CalPERS pension liabilities incurred and owed to FCFA, under the Five Cities Fire Authority Joint Exercise of Powers Agreement, over the time period Oceano was a member agency.

ARTICLE V

TERM OF AGREEMENT

5.1 Term. The term of this Agreement shall commence on the earlier of July 1, 2023 or the date on which both Parties have fully executed this Agreement, through June 30, 2024 (‘’Initial term”).

5.2 Renewal or Extension of Agreement. The Term of this Agreement may be extended upon mutual agreement of both Parties. Upon written notice of either Party, at ninety (90) days before the end of the Initial Term, the Parties shall meet and confer for a period of up to sixty (60) days regarding extending the term of the Agreement and the terms and conditions of the extension. If agreement cannot be reached regarding extension or renewal, the Agreement shall terminate with no further obligations of either Party at the end of the Initial Term. If the Agreement is extended by the Parties (the “Extended Term”), notwithstanding any other provisions of this Agreement, the Parties anticipate that the term for the Extended Term will be on a month-to-month basis commencing upon the end of the Initial Term.

5.3 Termination. During the initial term, if either Party seeks to terminate this Agreement, the notice to terminate shall be in writing and shall be at least one hundred twenty (120) days before the planned termination date. If Oceano is not current on all payments owed and is in default under this Agreement FCFA may terminate this

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ATTACHMENT 2
5 Agreement immediately. If during the initial term, LAFCO makes a final determination as to Oceano's application for divestiture of fire services, and the decision of LAFCO would by operation of law or by lawful conditions imposed by LAFCO as part of their decision, preclude Oceano from participating as a Party to this Agreement or restrict their ability to enforce this Agreement, this Agreement shall terminate. Nothing within this section shall absolve Oceano of the obligation to pay for any and all FCFA services rendered under this Agreement prior to termination resulting from LAFCO'S decision causing termination or a Party initiated termination.

ARTICLE VI

INDEMNIFICATION AND INSURANCE

6.1 Mutual Indemnification.
(a) To the fullest extent permitted by law, each Party (the “Indemnifying Party”) shall indemnify, defend and hold harmless the other party, in proportion to fault, against any and all liability for claims, demands, fines, penalties, expenses, losses, causes of action, costs or judgments·(direct, indirect, incidental or consequential damages) involving bodily injury, personal injury, death, property damage or other costs and expenses (including reasonable attorneys' fees, court costs and expenses) arising or resulting from: 1) the acts or omissions of the Indemnifying Party’s own officers, agents, employees or representatives carried out pursuant to the obligations of this Agreement; (b) any negligent, reckless or intentionally wrongful act or omission to act by the Indemnifying Party; and (c) violations of law by the Indemnifying Party.
(b) Notwithstanding the foregoing Sections 6.l (a) Oceano shall remain liable for its own real and personal property damage (including, without limitation, autos, equipment, and apparatus), since it is retaining ownership of, insurable interests therein, and insurance on its real and personal property. (c) Except for any duties either Party owes to the other pursuant to the provisions of this Agreement, nothing in this Agreement shall be construed to waive any legal protections or immunities available to the Parties under state or federal law.
(d) Accordingly, the Parties hereby expressly agree to waive the pro rata risk allocation contained in California Government Code Section 895.6.

6.2 Mutual Indemnification Obligations Survive Termination. As to activities· occurring or being carried out in performance of this Agreement and during the term of this Agreement, the obligations created by Section 6.1 shall survive termination of this Agreement.

6.3 Immunity Preservation. Nothing in this Agreement shall be read as

65501.00100\41328557.11
ATTACHMENT 2
6 waiving or limiting any defense to claims of liability otherwise available to fire personnel, and/or public employees, such as the defense of qualified immunity. Nothing in this Agreement shall be read as intending to create or creating a higher duty of care on the part of either Oceano or FCFA, or their officers, than would otherwise exist under existing law and the involved Party's own policies, practices, and procedures.

6.4 Public Liability and Property Insurance.
(a) Each Party shall maintain in effect, at its own cost and expense, the following insurance coverage provided either through a bona fide program of self-insurance, commercial insurance policies, or any combination thereof:
i. Commercial general liability or public liability with minimum limits of $1,000,000.00 per occurrence.
ii. Auto liability including owned, leased, non-owned,
and hired automobiles, with a combined single limit of not less than $1,000,000.00 per occurrence.
iii. If a Party employs others in the performance of this Agreement, that Party shall maintain Workers' Compensation in accordance with California Labor Code section 3700 with a minimum of $1,000,000 per occurrence for employer's liability, for the duration of time that such workers are employed.
(b) All insurance required by this Agreement shall:
i. Be placed (1) with companies admitted to transact
insurance business in the State of California and with a current A.M. Best rating of no less than A:VI or with carriers with a current A.M. Best rating of no less than A:VII; or (2) disclosed self- insurance with limits acceptable to the other Party. ii. Provide that each Party's insurance is primary and
non-contributing insurance to any insurance or self-insurance maintained by the other Party and that the insurance of the other Party shall not be called upon to contribute to a loss covered by a Party's insurance.
(c) Each Party shall file certificates of insurance with the other Party evidencing that the required insurance is in effect within thirty (30) days after the effective date of this Agreement.

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ATTACHMENT 2
7 6.5 Workers Compensation.
(a) FCFA shall provide Oceano an endorsement that its Workers Compensation insurer waives the right of subrogation against Oceano, its officers, officials, employees, and volunteers for all claims on or after the effective start date of this Agreement during the tenure of said Agreement.

ARTICLE VII

MISCELLANEOUS

7.1 Amendments to Agreement. No part of this Agreement shall be altered or amended except by written amendment and mutual consent of both Parties.

7.2 Assignment. The rights and obligations of the Parties under this Agreement are not assignable and shall not be delegated without the prior written approval of the other Party.

7.3 Dispute Resolution. The Parties recognize that this Agreement cannot represent a complete expression of all issues which may arise during the performance of the Agreement. Accordingly, FCFA and Oceano agree to meet and confer in good faith over any issue not expressly described herein. (a) It is the Parties' intention to avoid the cost of litigation and to resolve any issues that may arise amicably if possible. To that end, the Parties agree through the City Managers of Arroyo Grande and Grover Beach and the Oceano General Manager to meet within ten (10) business days of a request made by the other party in writing to discuss any issues and attempt to resolve the dispute. If the dispute is not resolved after that meeting, the Parties agree to participate in a mediation to resolve the dispute within 30 calendar days of the meeting or as soon thereafter as possible. The mediator will be chosen by mutual agreement of the Parties. The costs of mediation will be borne by the Parties equally. Any agreement reached during the mediation will be binding on the Parties during the remaining term of the Agreement. No party may initiate litigation prior to the conclusion of mediation. In any action brought under this Agreement, the prevailing Party shall be entitled to recover its actual costs and reasonable attorney fees in an amount not to exceed ten thousand dollars ($10,000.00).

7.4 Exhibits. The following Exhibits are attached hereto and incorporated as if fully set forth herein:

Exhibit “A”: Oceano Jurisdiction Map

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ATTACHMENT 2
8 Exhibit “B”: Scope of Fire and Emergency Medical Services Exhibit “C”: Third Amended Joint Powers Agreement of the FCFA

7.5 Notices. All notices required or permitted hereunder shall be deemed sufficiently given if delivered by hand, electronic mail, or by United States mail, postage prepaid, addressed to the Parties at the addresses set forth below or to such other address as may, from time to time, be designated in writing.

To Oceano:

General Manager
1655 Front St.

Oceano, CA. 93445
To FCFA:

Fire Chief
140 Traffic Way
Arroyo Grande, CA 93420

7.6 Governing Law. Agreement shall be governed by the laws of the state of California with venue being the Superior Court of the County of San Luis Obispo.

7.7 Third Party Beneficiary. The Agreement is only for the benefit of the Parties to the Agreement and shall not be construed or deemed to operate as an agreement for the benefit of any third party or parties and no third parties shall have any right of action or obtain any right of benefits or position of any kind for any reason whatsoever.

7.8 Default and Delinquency. If Oceano defaults in its obligation to pay or advance any amounts due pursuant to this Agreement after such amounts have become delinquent, Oceano shall be liable to the FCFA for interest on any unpaid amount at the rate of 10%, or the maximum rate allowed by law if it is less than 10%, until the overdue invoice amount is paid in full.

7.9 Waiver. The waiver at any time by any Party of its rights with respect to a default or other matter arising in connection with this Agreement shall not be deemed a waiver with respect to any subsequent default or matter.

7.10 Remedies Not Exclusive. The remedies provided in this Agreement are cumulative and not exclusive, and are in addition to any other remedies that may be provided by law or equity. The exercise by any Party of any remedy under this Agreement shall be without prejudice to the enforcement of any other remedy.

65501.00100\41328557.11
ATTACHMENT 2
9 7.11 Severability. The invalidity, illegality or unenforceability of any provision of this Agreement shall not render the other provisions unenforceable, invalid or illegal.

7.12 Counterparts. This Agreement may be executed by the Member Agencies in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument.

IN WITNESS WHEREOF, the Parties execute this agreement hereto on the day and the year first written above.

65501.00100\41328557.11
ATTACHMENT 2
10 FIRE CITIES FIRE AUTHORITY
By
Authority Chair
Dated
ATTEST:

By
Authority Clerk
APPROVED AS TO FORM:

Authority Attorney

OCEANO COMMUNITY SERVICES DISTRICT
By
President
Dated
ATTEST:

By
District Clerk
APPROVED AS TO FORM:

District Counsel

65501.00100\41328557.11
ATTACHMENT 2
11 EXHIBIT “A”

OCEANO JURISDICTION MAP

65501.00100\41328557.11
ATTACHMENT 2
12

65501.00100\41328557.11
ATTACHMENT 2
13 EXHIBIT “B”

SCOPE OF SERVICE
Scope of Services
FCFA shall provide the following services while this Agreement is in effect:

1. Administration. Provide administrative responsibility and support for all fire, emergency and non-emergency services in the Oceano Community Services District (“Oceano”).

Administration of fire services shall include the following:
a. Adequate supervision and staffing,
b. Program planning;
c. Delivery and documentation of all federal and state-mandated firefighter training;
d. Coordination of procurement of all operational supplies, services, and equipment;
e. Representation at Oceano Board meetings as deemed necessary by the Oceano General Manager and agreed to by the FCFA Fire Chief; f. Transparency with Oceano in management decisions affecting fire service delivery.

2. Incident Response. Delivery of all fire protection and emergency services within the jurisdictional limits of Oceano Community Services District, including responding to calls for fire suppression, emergency medical response (Basic Life Support services), rescue services, hazardous materials, and all other emergency and non-emergency calls for service as received and dispatched to the FCFA. A Chief Officer, or acting Chief Fire Officer, shall respond to all major incidents as determined by the Fire Chief.

3. Fire Safety Inspections/Enforcement. Enforce code provisions related to fire services, including but not limited to weed abatement and fireworks, and hazardous material releases. Review of all development and building plans to ensure compliance with applicable fire and life safety codes and regulations, as well as inspection of fire protection and fire alarm systems for compliance with applicable codes and standards.

To the maximum extent feasible, inspection shall be performed during standard duty hours.

4. Investigations. Investigate all fires to establish origin and cause and coordinate with the Oceano Community Services District on criminal investigations and prosecutions resulting therefrom. Provide fire investigation reports.

65501.00100\41328557.11
ATTACHMENT 2
14 5. Training. Maintain a continuous training program that corresponds to federal, state and local mandates, as well as evolving industry best practices and developments in emerging fire suppression and fire prevention techniques. 6, Emergency Management. FCFA, through its Fire Chief, or his/her designee, shall be responsible for the coordination and communication with the County of San Luis Obispo Office of Emergency Services . Pursuant to existing agreements, FCFA will coordinate with other agencies regarding mutual aid services to Oceano Community Services District. FCFA will also respond to requests for mutual aid or assistance-by-hire by other agencies pursuant to the California Statewide Mutual Aid Agreement or the California Fire Assistance Agreement.

65501.00100\41328557.11
ATTACHMENT 2
15 EXHIBIT “C”

THIRD AMENDED JOINT POWERS AGREEMENT OF THE FCFA

65501.00100\41300388.5
ATTACHMENT 3
OCEANO COMMUNITY SERVICE DISTRICT’S ONGOING CAL PERS

LIABILITIES AND RESPONSIBILITIES FOLLOWING WITHDRAWAL FROM THE

FIVE CITIES FIRE AUTHORITY JOINT EXERCISE OF POWERS AGREEMENT This AGREEMENT (“Agreement”) is dated this __ day of ____, 2023, for reference purposes only, and is entered into by and between the Five Cities Fire Authority (“FCFA”), and the Oceano Community Services District (“Oceano”), which are hereinafter referred to as “Party” or collectively as “Parties.” This Agreement memorializes Oceano’s ongoing share of unfunded CalPERS liabilities, including but not limited pension/CalPERS, accrued fringe benefits, and other liabilities incurred from Oceano’s participation in the Five Cities Fire Authority, prior to June 30, 2023 (“Liabilities”).

RECITALS
A. On June 7, 2010, the cities of Arroyo Grande and Grover Beach, and Oceano, desirous of improving the quality and level of fire suppression and emergency medical service delivery within their communities through the sharing of resources and expertise, entered into a Joint Powers Authority Agreement (the “JPA”) and have operated as Five Cities Fire Authority pursuant to the terms and conditions in that agreement since that time as JPA member agencies.

That JPA, and its First, Second and Third Amendments, are incorporated herein and attached as Exhibit “A” (collectively, “JPA and its Amendments”).

B. The obligations contained within Exhibit “A” remain binding on each of the Parties, including Oceano’s Liabilities, incurred over the time period during which each Party serves or has served as a JPA member agency.

C. Under that JPA and its Amendments, the Parties have shared fire services, allowing for cost savings and operational efficiencies in providing fire services to the public.

D. Oceano has served as a member agency of the JPA since the inception of the FCFA on June 7, 2010, but is exiting the JPA on June 30, 2023 due to mutually adopted provisions by each Party under the JPA.

E. Specifically, and pursuant to Section 4 of the Third Amendment to the JPA, Oceano was required to place a special sales tax measure on the 2022 primary ballot, that would enable Oceano to be able to fund its proportionate share of costs owed to the FCFA.

F. As that 2022 Oceano ballot measure failed, and Oceano is unable to fund its proportionate share of its costs owed to the FCFA, by the terms of the Third Amendment to the JPA, incorporated herein as Exhibit “A,” the JPA subsequently entered into a “Wind Down Period,” with certain ongoing obligations and Liabilities owed by Oceano before an automatic withdrawal from the FCFA on June 30, 2023.

G. The Parties have now determined this Agreement is necessary to set out the continued FCFA obligations owed by Oceano under the “Wind Down Period” incorporated by Exhibit “A,” and to set forth a process by which those Oceano Liabilities will be paid in full.

65501.00100\41300388.5
H. The Parties agree that all proportionate Oceano Liabilities, as well as all debts and obligations owed by Oceano to the FCFA, shall remain in effect until paid in full.

NOW, THEREFORE, for and in consideration of the mutual covenants and conditions hereinafter stated the Parties agree as follows:

1. Recitals. The recitals above are true and correct and are hereby incorporated into the terms of this Agreement as though fully set forth herein.

2. Term. The term of this Agreement shall commence as of the date the governing boards of all Parties have fully executed this Agreement and shall continue until terminated automatically upon the date Oceano has paid all proportionate Liabilities, as well as all debts and obligations owed by Oceano to the FCFA, as set herein.

3. Oceano’s Financial Obligations.

3.1 Nothing within this Agreement modifies Oceano’s obligations under the Five Cities Fire Authority Joint Powers Authority Agreement, as amended, in particular the Third Amendment included as Exhibit “A.”

3.2 Oceano remains subject to all “Wind Down Period” obligations set forth within the JPA and its Amendments, incorporated as Exhibit “A.” Specifically, under Section 5 of the Third Amendment to the JPA, Oceano’s withdrawal from the FCFA shall not absolve Oceano from any Liabilities arising out of Oceano’s participation in the JPA since the time the FCFA was created on June 7, 2010 through the date of Oceano’s withdrawal from the JPA on June 30, 2023 (“Effective Date Range for Liabilities”).

3.3 Oceano warrants and agrees to pay any and all Liabilities arising out of its participation in the JPA over the Effective Date Range for Liabilities. Oceano warrants and agrees to the FCFA’s use of the City of Arroyo Grande’s CalPERS contract for employees of the FCFA, effective since the inception of the JPA.

3.4 Oceano’s share of Liabilities shall bear the same proportionate relationship to the whole as its annual contribution for the operation of the FCFA as set forth in Exhibit “A” over the Effective Date Range for Liabilities. Oceano’s share of such Unfunded Accrued Pension Liability (“UAPL”) expenses shall be determined according to the same formula used by the FCFA to allocate such costs during the final year of the withdrawing Oceano’s membership. (a) Oceano’s share of Liabilities shall be reduced by (i) Oceano’s proportionate share of the FCFA fund balance as of June 30, 2023, and (ii) Oceano’s proportionate ownership share of FCFA physical assets as of June 30, 2023, which equals Two Hundred Seventy-Eight Thousand One Hundred Nine Dollars ($278,109). The amount of Oceano’s proportionate share of the FCFA fund balance as of June 30, 2023, will be determined by the FCFA Treasurer based on the audited financial report for Fiscal Year 2022-23.

3.5 Actuary Report. The Parties shall agree and rely on an Actuary Report utilized by the FCFA to determine Oceano’s share of Liabilities. Specifically, the Parties agree to rely on any Actuary Report commissioned by the FCFA that methodically determines all CalPERSPage 573 of 589 65501.00100\41300388.5
designated liabilities, commissioned in response to Arroyo Grande’s CalPERS contract, to determine the Liabilities owed by Oceano to FCFA. Attached as Exhibit “B” is Foster & Foster’s Five Cities Fire Authority CalPERS Miscellaneous and Safety Plans Unfunded Liability Analysis (“Preliminary Actuary Report”) reflecting the Parties share of Liabilities for FCFA through June 30, 2021. That Preliminary Actuary Report is presented as an example. At that time FCFA completes an Actuary Report that reflects Oceano’s proportionate share of Liabilities over the Effective Date Range for Liabilities, through June 30, 2023 (“Final Actuary Report”), that Final Actuary Report will be attached, replacing the Preliminary Actuary Report, and incorporated herein as a revised Exhibit “B.” Any Final Actuary Report shall be used to determine Oceano’s owed amount over the Effective Date Range for Liabilities and shall be binding on the Parties for purposes of Oceano’s required payment of Liabilities under Section

3.6. The Final Actuary Report may be revised from time to time based on any updated transmittal of FCFA’s CalPERS liabilities over the Effective Date Range for Liabilities. At the time a Final Actuary Report is revised as commissioned by FCFA, those revisions shall automatically be incorporated by reference as Exhibit “B.” (a) The Parties consent and agree with the formula, calculations used and Oceano’s agreed upon shares attributed to services rendered over the Effective Date Range for Liabilities, as set forth in the Actuary Report that shall be attached and incorporated herein as Exhibit “B,” and will be similar in analysis to the Preliminary Actuary Report. (b) The Parties consent and agree that Oceano’s Liabilities shall be calculated using the same assumptions used by CalPERS to calculate UAPL for contracting agencies with active contracts unless Oceano elects to pay its share of liabilities on a lump sum basis, in which case, the assumption used shall be the assumptions used by CalPERS to calculate UAPL for contracting agencies on a terminated basis.

3.6 Payment Options. Oceano’s Liabilities are due and payable to the FCFA based on one of the following two payment options, which ensures full recovery for any and all proportionate Oceano Liabilities incurred prior to June 30, 2023. Failure to meet the obligations set forth in this Section 3.5 herein constitutes a default by Oceano. (a) Lump Sum. Upon execution by the Parties of this Agreement, Oceano may issue a lump sum invoice payment for the Total Cost of Liabilities owed to the FCFA, as set forth under Section 3.3 above and subject to any Final Actuary Report incorporated as Exhibit “B,” within 180 days of Parties’ receipt of the Actuary Report that will be accepted by the Parties by the terms described herein.
(b) Annual Payment. Upon execution by the Parties of this Agreement, Oceano may initiate an annual payment for the Total Cost of Liabilities, due and payable via invoice within sixty (60) days of receipt of a FCFA invoice evidencing applicable CalPERS liabilities for any portion of the Effective Date Range of Liabilities, based on the applicable Final Actuary Report incorporated as Exhibit “B. Should Oceano initiate annual payments, Oceano reserves the right to make a future lump sum payment for the remaining Total Cost of Liabilities owed to the FCFA based on an Actuary Report agreeable to all Parties, due and payable via invoice within sixty (60) days of receipt of a FCFA invoice.

65501.00100\41300388.5

3.7 Default and Delinquency. If Oceano defaults in its obligation to pay or advance any amounts due pursuant to this Agreement after such amounts have become delinquent, Oceano shall be liable to the FCFA for interest on any unpaid amount at the rate of 10% per annum, or the maximum rate allowed by law if it is less than 10% per annum, until the overdue invoice amount is paid in full.

4. Indemnification. The Parties shall indemnify, defend and hold harmless the other Parties’ members, officers, directors, employees and agents from and against any and all liability, loss, damages, expenses, costs (including, without limitations, costs and fees of litigation or arbitration) of every nature, arising out of any act or omission related to this Agreement.

5. Conflict Resolution. The Parties agree that any and all disputes, claims or controversies between the Parties arising out of or relating to performance of this Agreement, shall be resolved pursuant to the conflict resolution provisions as follows:

5.1 The Parties shall first meet and attempt in good faith to negotiate and resolve any dispute arising out of or relating to this Agreement, subject to subsequent approval of any such resolution by the respective governing boards of the Parties.

5.2 If the matter cannot be resolved, then the Parties agree that the matter shall be submitted to mediation within a reasonable period of time after receipt of a written request from one Party requesting such mediation. The Parties shall cooperate with one another in selecting a mediator and in scheduling the mediation proceedings. Should the Parties be unable to agree upon a mediator, they shall agree upon a mediation service and shall have that service select a mediator for them. The Parties agree that they shall participate in the mediation in good faith and that they will share equally in the costs of mediation. All offers, promises, conduct and statements, whether oral or written, made in the course of the mediation by any of the Parties, their agents, employees, experts and attorneys, and by the mediator or any employees of the mediator, are confidential, privileged and inadmissible for any purpose, including impeachment, in any litigation or other proceeding involving the Parties, provided that evidence that is otherwise admissible or discoverable shall not be rendered inadmissible or non-discoverable as a result of its use in the mediation.

5.3 If the matter is not resolved by negotiation, then the Parties may submit the matter to binding or non-binding arbitration, but only if the Parties agree to submit the particular controversy to arbitration. No Party shall have a right to submit any controversy to arbitration without the other Parties’ consent.

6. General Provisions.

6.1 Construction and Interpretation. It is agreed and acknowledged by the Parties that this Agreement has been arrived at through negotiation, and that each Party has had a full and fair opportunity to revise the terms of this Agreement. Consequently, the normal rule of construction that any ambiguities are to be resolved against the drafting Party shall not apply in construing or interpreting this Agreement.

65501.00100\41300388.5

6.2 Waiver. The waiver at any time by any Party of its rights with respect to a default or other matter arising in connection with this Agreement shall not be deemed a waiver with respect to any subsequent default or matter.

6.3 Remedies Not Exclusive. The remedies provided in this Agreement are cumulative and not exclusive, and are in addition to any other remedies that may be provided by law or equity. The exercise by any Party of any remedy under this Agreement shall be without prejudice to the enforcement of any other remedy.

6.4 Severability. The invalidity, illegality or unenforceability of any provision of this Agreement shall not render the other provisions unenforceable, invalid or illegal.

6.5 Successors and Assigns. Except as otherwise provided by law, the rights and duties of the Parties under this Agreement shall not be assigned or delegated without the prior written consent of the other Parties. Any attempt to assign or delegate such rights or duties in contravention of this Agreement shall be null and void.

6.6 No Third Member Agency Beneficiaries. This Agreement shall not be construed to create any third party beneficiaries. This Agreement is for the sole benefit of the Parties, and their permitted successors, transferees and assignees, and no other person or entity shall be entitled to rely upon or receive any benefit from this Agreement or any of its terms.

6.7 Amendment. This Agreement may be modified or amended only by a subsequent written agreement approved by the governing board of each Party, and executed by each Party pursuant to the terms and conditions of this Agreement.

6.8 Governing Law and Venue. Except as otherwise required by law, this Agreement shall be interpreted, governed by, and construed under the laws of the State of California. The County of San Luis Obispo shall be the venue for any litigation concerning the enforcement or construction of this Agreement.

6.9 Attorney Fees. In the event any legal action is brought to enforce or construe this Agreement, the prevailing party shall be entitled to an award of reasonable attorney fees, expert witness and consulting fees, litigation costs and costs of suit.

6.10 Notice. Any notice, demand, invoice or other communication required or permitted to be given under this Agreement shall be in writing and either served personally or sent by prepaid, first class U.S. mail to the Agency Clerk and Agency Attorney of each Party.

Any notice or other communication served by personal delivery shall be deemed received when actually delivered. Any notice or other communication shall be deemed as received three days after deposit in United States mail, postage prepaid, return receipt requested.

6.11 Counterparts. This Agreement may be executed by the Member Agencies in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument.

65501.00100\41300388.5
Exhibits:

1. Exhibit “A” – Five Cities Fire Authorities Joint Powers Authority Agreement and Amendments

2. Exhibit “B” – Actuary Report of Five Cities Fire Authority Unfunded Accrued Pension Liability
[signature page follows]

65501.00100\41300388.5
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date last executed as set forth below.

FIRE CITIES FIRE AUTHORITY
By
Authority Chair
Dated
ATTEST:

By
Authority Clerk
APPROVED AS TO FORM:

Authority Attorney
City Attorney

65501.00100\41300388.5

OCEANO COMMUNITY SERVICES DISTRICT
By
President
Dated
ATTEST:

By
District Clerk
APPROVED AS TO FORM:

District Counsel

65501.00100\41300388.5
Exhibit “A” – Five Cities Fire Authorities Joint Powers Authority Agreement and Amendments

65501.00100\41300388.5
Exhibit “B” – Actuary Report of Five Cities Fire Authority Unfunded Accrued Pension Liability

65501.00100
\41300388.5

Description Description
Truck 6645 * 2010 Pierce Quint (Aerial) 52,177 FCFA $575,000 $262,699 $198,847 $113,454 $575,000Engine 6691 2007 Pierce Type I 90,929 AG $140,000 $140,000 ‐‐ $140,000Engine 6692 2017 Pierce Type 1 PUC 37,563 FCFA $325,000 $148,482 $112,392 $64,126 $325,000 Engine 6693 2018 Pierce Type 1 PUC 33,446 FCFA $325,000 $148,482 $112,392 $64,126 $325,000 Engine 6661 2000 Hi‐Tech Type III 40,252 OCE $125,000 ‐‐ $125,000 $125,000 Patrol 6663 2002 Ford F‐550 Patrol 14,015 OCE $25,000 ‐‐ $25,000 $25,000Rescue 6652 1995 International E‐1 25,106 AG $20,000 $20,000 ‐‐ $20,000Engine TBD 2022 Pierce Type III FCFA $451,000 $206,047 $155,965 $88,987 $451,000 Subtotal Suppression/Rescue Fleet $1,986,000 $907,340 $686,801 $391,859 $1,986,000 C6600 2021 Chevrolet Tahoe 7,605 FCFA $59,000 $26,955 $20,403 $11,641 $59,000 B6611 2014 Dodge Command Vehicle 66,280 FCFA $13,000 $5,939 $4,496 $2,565 $13,000B6612 2018 Ford F‐250 Command Vehicle FCFA $45,000 $20,559 $15,562 $8,879 $45,000Utility 6631 2019 Ford F‐250 Utility 27,476 FCFA $45,000 $20,559 $15,562 $8,879 $45,000 Utility 6632 1995 Ford F‐250 Utility 44,914 AG $5,000 $5,000 ‐‐ $5,000 White Avenger 2009 Dodge Avenger 71,287 FCFA $3,000 $1,371 $1,037 $592 $3,000 Blue Avenger 2009 Dodge Avenger 64,328 FCFA $3,000 $1,371 $1,037 $592 $3,000 UTV‐1 2020 Polaris Ranger Crew XP1000 FCFA $18,000 $8,224 $6,225 $3,552 $18,000UTV Trailer 1 2020 Flatbed Trailer FCFA $1,500 $685 $519 $296 $1,500UTV Trailer 2 2021 Flatbed Trailer FCFA $1,500 $685 $519 $296 $1,500Shoring Trailer 1994 Pace Cargo Trailer AG $2,000 $2,000 ‐‐ $2,000 Escape Hybrid 2008 Ford Escape Hybrid 49,319 FCFA N/A ‐‐ ‐ ‐ Stakeside *** 2004 Ford F‐650 Stakeside 50,240 FCFA N/A ‐‐ ‐ ‐ Frankenstein 2010 Chevrolet 3500 Flatbed 106,933 FCFA $7,500 $3,427 $2,594 $1,480 $7,500Lurch 2010 Ford F‐350 Flatbed 86,366 FCFA $5,500 $2,513 $1,902 $1,085 $5,500 Arson Pickup 2007 Ford F‐150 FCFA $4,000 $1,827 $1,383 $789 $4,000UTV‐2 2012 Kawasaki KRF750N FCFA $2,500 $1,142 $865 $493 $2,500 UTV‐3 2012 Kawasaki KRF750N FCFA $2,500 $1,142 $865 $493 $2,500 Forklift *** 2001 Liftking Forklift FCFA N/A ‐‐ ‐ ‐
Subtotal Misc Fleet $218,000 $103,399 $72,968 $41,633 $218,000 GRAND TOTAL $2,204,000 $1,010,739 $759,770 $433,491 $2,204,000 ADJUSTED TOTAL w/o LEASE $1,103,000 $507,727 $379,020 $216,252 $1,103,000 * Vehicle has significant mechanical issues, repairs records on file. Staff does not support appraised value. ** Federal Surplus ‐ Title remains with USFS
*** Federal Surplus ‐ California Gross Polluter
Fleet Market Value Summary
Five Cities Fire Authority
Svc
Year
Arroyo
Grande
Grover
Beach Oceano
Allocated
Total
Mileage
8/19/22
Contributing
Agency
Est Mkt
Value
ATTACHMENT 4

Description
Make /
Model
Contributing
Agency
Replace
Cost
SvcYear
Svc
Life
ReplaceYear Book Value
Arroyo
Grande
Grover
Beach Oceano
Allocated
Total
SCBA MSA FCFA $400,000 2018 15 2033 $218,353 $99,759 $75,511 $43,083 $218,353Air Fill Compressor * Bauer Grover Beach $100,000 2000 15 2015                 ‐ ‐ ‐ ‐ ‐ Air Fill Compressor ** Bauer Oceano $100,000 2005 15 2020                 ‐ ‐ ‐ ‐ ‐Thermal Imaging Camera 6691 FCFA $11,000 2020 4 2024 $5,500 $2,513 $1,902 $1,085 $5,500 Thermal Imaging Camera 6692 FCFA $11,000 2020 4 2024 $5,500 $2,513 $1,902 $1,085 $5,500 Thermal Imaging Camera 6693 FCFA $11,000 2020 4 2024 $5,500 $2,513 $1,902 $1,085 $5,500 Thermal Imaging Camera 6645 FCFA $11,000 2020 4 2024 $5,500 $2,513 $1,902 $1,085 $5,500 Handheld Gas Monitor 6691 FCFA $15,000 2019 4 2023 $3,750 $1,713 $1,297 $740 $3,750 Handheld Gas Monitor 6692 FCFA $15,000 2019 4 2023 $3,750 $1,713 $1,297 $740 $3,750 Handheld Gas Monitor 6693 FCFA $15,000 2019 4 2023 $3,750 $1,713 $1,297 $740 $3,750 Handheld Gas Monitor 6645 FCFA $15,000 2019 4 2023 $3,750 $1,713 $1,297 $740 $3,750 Handheld Gas Monitor 6652 FCFA $15,000 2019 4 2023 $3,750 $1,713 $1,297 $740 $3,750 Halmotro Extrication All Units FCFA $204,000 2011 15 2026 $54,400 $24,854 $18,813 $10,734 $54,400 Totals $313,503 $143,229 $108,416 $61,857 $313,503* Located at Station 1 No Mkt Value per Bauer ** Located at Station 2 No Mkt Value per Bauer
Five Cities Fire Authority
Capital Equipment Summary

Approved
Budget
Adjusted
Budget
Baker Tilly A-4
Estimate
Proposed
Budget
2020-21 2021-22 2022-23 2022-23 2023-24 2023-24
Beginning Fund Balance $ 1,005,267 $ 1,387,744 $ 1,324,318 $ 1,324,318 $ 1,143,000 $ 1,124,939 $ (18,061) Revenues 6,789,777 6,572,902 5,849,718 7,010,580 8,475,000 8,413,610 (61,390) Expenditures:

Salaries & Benefits 5,254,729 5,546,681 5,522,800 5,645,100 6,801,000 6,801,000 - Services & Supplies 905,228 975,437 1,089,075 1,183,775 1,272,000 1,527,143 255,143 Equipment Replacement 146,147 13,013 100,000 227,187 204,000 264,000 60,000 Debt Service 101,197 101,197 153,897 153,897 464,000 153,893 (310,107) Total Expenditures 6,407,300 6,636,328 6,865,772 7,209,959 8,741,000 8,746,036 5,036 Change in Fund Balance 382,477 (63,426) (1,016,054) (199,379) (266,000) (332,426) Ending Fund Balance $ 1,387,744 $ 1,324,318 $ 308,264 $ 1,124,939 $ 877,000 $ 792,513

10.03% 9.06%
Variance Baker
Tilly vs Proposed
Better/(Worse)

ACTUALS

FIVE CITIES FIRE AUTHORITY
For the Fiscal Year Ending June 30, 2024
ATTACHMENT 5

Approved
Budget
Adjusted
Budget
Proposed
Budget

ACT ACCOUNT NAME
FY 2020-21
Actual
FY 2021-22
Actual 2022-23 2022-23 2023-24

REVENUES
4301 INTEREST $ 2,812 $ 992 $ 700 $ 700 $ 6,800
4422 ARROYO GRANDE FIRE

REIMBURSEMENT
2,580,955 2,580,955 2,580,955 2,580,955 3,796,000
4422 ARROYO GRANDE FIRE

REIMBURSEMENT
- - - 887,401 -
4428 FEMA REVENUE - - - - -
4443 GROVER BEACH FIRE REIMBURSEMENT 2,015,115 2,015,115 2,015,115 2,015,115 2,812,000 4444 OCEANO FIRE REIMBURSEMENT 1,138,148 1,138,148 1,138,148 1,138,148 1,150,000 4458 STATE GRANT 28,520 700 3,800 3,800 3,800
4491 SAFER GRANT - - - - -
4462 LOCAL GRANT 18,354 8,141 - 13,500 -
4705 INSPECTIONS 111,429 89,814 87,000 87,000 181,010
4726 FIRE IMPACT FEES 3,892 5,365 - - -
4729 FIRE-FIRST RESPONDER SUPPORT 24,993 8,559 24,000 24,000 24,000 4730 STRIKE TEAM REIMBURSEMENT 742,033 705,963 - 249,961 440,000 4803 SALES-EQUIPMENT/MATERIALS 41,500 - - - -
4807 EXPENSE RECOVERY 82,026 19,150 - - -
4809 DONATIONS - - - 10,000 -
4816 PROCEEDS FROM DEBT ISSUANCE - - - - -
GRAND TOTAL REVENUES $ 6,789,777 $ 6,572,902 $ 5,849,718 $ 7,010,580 $ 8,413,610 BUDGET

FIVE CITIES FIRE AUTHORITY
For the Fiscal Year Ending June 30, 2024

Approved
Budget
Adjusted
Budget
Proposed
Budget

ACT ACCOUNT NAME
FY 2020-21
Actual
FY 2021-22
Actual 2022-23 2022-23 2023-24
BUDGET

FIVE CITIES FIRE AUTHORITY
For the Fiscal Year Ending June 30, 2024

EXPENDITURES
5101 SALARIES FULL-TIME 1,803,998 1,896,061 2,789,900 2,684,400 3,104,880 5102 SALARIES PERMANENT PART-TIME 10,097 501 32,100 15,000 12,300 5103 SALARIES TEMPORARY PART-TIME 120,294 53,236 51,400 18,000 - 5105 SALARIES OVERTIME 790,173 857,273 667,000 800,000 919,000 5106 SALARIES - STRIKE TEAM OVERTIME 488,621 445,491 - 173,900 314,000 5108 HOLIDAY PAY 116,038 125,830 117,900 117,900 143,200 5109 SICK LEAVE PAY 55,131 60,839 - - -
5110 ANNUAL LEAVE BUY BACK 8,307 9,540 9,000 9,000 10,000 5111 VACATION BUY BACK 43,926 38,173 56,700 46,400 45,000 5112 SICK LEAVE BUY BACK 2,703 764 2,000 700 2,235
5113 VACATION LEAVE PAY 58,905 98,555 - - -
5114 COMPENSATION PAY 118,456 137,266 - - -
5115 ANNUAL LEAVE 29,791 62,404 - - -
5121 PERS RETIREMENT 526,763 553,308 518,200 518,200 843,700 5122 SOCIAL SECURITY 260,144 259,293 215,900 280,000 267,800 5123 PARS RETIREMENT 151 13 1,300 1,300 200
5126 STATE DISABILITY INS. (SDI) 24,811 31,253 23,600 23,600 28,600 5127 DEFERRED COMPENSATION 3,009 3,009 3,000 3,000 4,200 5128 UAL (UNFUNDED ACCRUED LIABILITY) 123,920 152,812 185,400 179,200 177,500 5131 HEALTH INSURANCE 408,057 424,265 499,900 425,000 535,300 5132 DENTAL INSURANCE 23,304 24,252 25,600 25,600 30,400 5133 VISION INSURANCE 6,428 6,548 7,000 7,000 8,200
5134 LIFE INSURANCE 2,925 3,035 3,300 3,300 3,900
5135 LONG TERM DISABILITY INSURANCE 8,876 8,876 9,200 9,200 10,400 5136 RETIREES HEALTH INSURANCE 12,660 13,137 13,000 13,000 14,528 5141 WORKERS COMPENSATION 206,611 235,600 235,600 235,600 263,300 5142 UNEMPLOYMENT INSURANCE - - 5,000 5,000 5,588
5143 UNIFORM ALLOWANCE - 45,347 50,000 50,000 55,875
5147 EMPLOYEE ASSISTANCE PROGRAM 630 - 800 800 894
Subtotal Salaries & Benefits 5,254,729 5,546,681 5,522,800 5,645,100 6,801,000

Approved
Budget
Adjusted
Budget
Proposed
Budget

ACT ACCOUNT NAME
FY 2020-21
Actual
FY 2021-22
Actual 2022-23 2022-23 2023-24
BUDGET

FIVE CITIES FIRE AUTHORITY
For the Fiscal Year Ending June 30, 2024
5201 SUPPLIES - OFFICE 6,403 6,163 7,140 7,140 7,354
5206 SUPPLIES - EMS 15,164 17,699 20,600 20,600 21,556
5208 POSTAGE/MAILING 3,657 3,086 3,000 3,000 3,090
5255 SPECIAL DEPARTMENT SUPPLIES 20,040 20,701 18,480 28,480 27,034 5272 PROTECTIVE/SAFETY CLOTHING 55,135 9,943 35,983 73,183 60,000 5273 SMALL TOOLS 2,792 2,945 3,060 3,060 3,152
5276 UNIFORMS 28,535 3,313 5,000 5,000 5,150
5301 ADVERTISING 415 - - - -
5303 CONTRACTUAL SERVICES 272,057 324,429 395,772 427,272 621,045 5306 PRINTING SERVICES 2,553 762 3,000 3,000 3,000
5315 PRE-EMPLOYMENT PHYSICALS 1,741 15,828 30,520 30,520 31,000 5316 JOB RECRUITMENT EXPENSE - 32 - - -
5324 FORENSIC MANDATE SERVICES - 2,050 1,000 1,000 9,000 5325 HAZMAT/SAFETY PROGRAM 14,504 12,984 15,800 15,800 15,800 5401 UTILITIES 55,381 61,412 50,000 50,000 60,000
5403 TELECOMMUNICATIONS 26,416 25,061 25,000 25,000 31,000 5501 CONFERENCE/TRAINING 15,850 11,120 14,240 14,240 19,667 5503 MEMBERSHIPS & SUBSCRIPTIONS 3,395 1,505 3,000 3,000 3,090 5504 PUBLIC RELATIONS 3,334 4,135 5,100 5,100 5,253
5508 MISC EXPENSE 2,021 2,257 12,000 12,000 3,160
5512 TRAVEL 15,994 9,970 2,100 2,100 2,163
5553 RENT-BUILDING AND LAND 15,000 15,000 15,000 15,000 - 5555 BANK CHARGES 1,473 497 1,006 1,006 1,036
5576 LIABILITY INSURANCE-JPA SHARE 23,051 41,103 49,320 49,320 51,200 5599 WEED ABATEMENT 24,747 22,067 12,240 12,240 12,607
5601 MAINTENANCE - VEHICLES 133,554 162,506 125,000 125,000 156,500 5602 MAINTENANCE - OFFICE EQUIPMENT 2,236 2,313 5,000 5,000 5,150 5603 MAINTENANCE - MACH & EQUIP 15,571 58,459 90,400 90,400 197,612 5604 MAINTENANCE - BUILDINGS 9,960 9,494 10,000 10,000 10,300 5605 MAINTENANCE - GROUNDS 408 818 1,000 1,000 3,530
5606 MAINTENANCE - RADIO

COMMUNICATIONS
18,651 5,133 8,364 8,364 8,615
5607 MAINTENANCE - COMPUTER

SOFTWARE
44,330 43,507 55,150 61,150 81,305
5608 GAS & OIL 44,029 57,525 50,800 60,800 52,324
5702 DATA PROCESSING EQUIPMENT 26,831 21,620 15,000 15,000 15,450 Subtotal Services & Supplies 905,228 975,437 1,089,075 1,183,775 1,527,143

Approved
Budget
Adjusted
Budget
Proposed
Budget

ACT ACCOUNT NAME
FY 2020-21
Actual
FY 2021-22
Actual 2022-23 2022-23 2023-24
BUDGET

FIVE CITIES FIRE AUTHORITY
For the Fiscal Year Ending June 30, 2024
5803 LEASE PURCHASE PAYMENTS 101,197 101,197 153,897 153,897 153,893 Subtotal Debt Service 101,197 101,197 153,897 153,897 153,893 6101 DATA PROCESSING EQUIPMENT - - - - -
6103 COMPUTER LICENSING SOFTWARE 7 - - - -
6201 MACHINERY & EQUIPMENT 45,112 - - - 204,000
6301 VEHICLES 101,028 13,013 100,000 227,187 60,000

FUTURE VEHICLE REPLACEMENT - - - - -
Subtotal Equip Replacement 146,147 13,013 100,000 227,187 264,000 GRAND TOTAL EXPENDITURES $ 6,407,300 $ 6,636,328 $ 6,865,772 $ 7,209,959 $ 8,746,036