Banning City Council
September 23, 2025

RESOLUTION 2025-133

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BANNING, CALIFORNIA, AWARD

OF A PROFESSIONAL SERVICES CONTRACT TO PECKHAM & MCKENNEY TO CONDUCT

THE EXECUTIVE RECRUITMENT FOR THE CITY OF BANNING NEXT PERMANENT CITY MANAGER IN THE AMOUNT OF $32,050.00.

WHEREAS, the Human Resources Department solicited proposals for executive recruitment services for City Manager; and
WHEREAS, the Human Resources Department received three proposals to evaluate and consider for the City Council interview stage. Only two proposals were moved forward for recommendation to the City Council; and
WHEREAS, the City Council members conducted interviews with the two selected proposers and selected Peckham and McKenney as the successful proposer to award the contract; and
WHEREAS, funding will be available in the City’s Human Resources Department account during Fiscal Year 25/26 in an amount not-to-exceed Thirty-Two Thousand, Fifty Dollars ($32,050).

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Banning as follows:

SECTION 1. The City Council approve the contract with Peckham & McKenney, for an amount not to exceed Thirty-Two Thousand, Fifty Dollars ($32,050) and authorize the City Manager to make necessary non-substantive changes, and to execute said agreement included as Exhibit A and attached to this resolution.

SECTION 2. The City Council authorizes the City Manager, or designee, to make necessary budget adjustments, appropriations, and transfers related to this resolution.

SECTION 3. The City Clerk shall certify to the adoption of this resolution and shall cause a certified resolution to be filed in the book of original resolutions.

PASSED, APPROVED AND ADOPTED this 23rd day of September 2025.

Sheri Flynn, Mayor
City of Banning
310
Resolution 2025-133

ATTEST:

Sandra Calderon,
Acting Administrative City Clerk
City of Banning
APPROVED AS TO FORM:

John Pinkey, City Attorney
Slovak, Baron, Empey, Murphy & Pinkney,
LLP
311
Resolution 2025-133

CERTIFICATION:

I, Sandra Calderon, Acting Administrative City Clerk of the City of Banning, California, do hereby certify that the foregoing Resolution 2025-133, was duly adopted by the City Council of the City of Banning, California, at a regular meeting thereof held on the 23rd day of September 2025 by the following vote, to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

Sandra Calderon,
Acting Administrative City Clerk
City of Banning, California
312
Resolution 2025-133

Exhibit A
Peckham & McKenney Contract
313
PROFESSIONAL SERVICES AGREEMENT (C00####)

FOR EXECUTIVE RECRUITMENT SERVICES FOR CITY MANAGER

BY AND BETWEEN

THE CITY OF BANNING
AND

CITY MANAGEMENT ADVISORS LLC
d.b.a.

PECKHAM & MCKENNEY
314
1 AGREEMENT FOR PROFESSIONAL SERVICES (C00###) FOR RECRUITMENT

SERVICES FOR CITY MANAGER BY AND BETWEEN CITY OF BANNING AND

CITY MANAGEMENT ADVISORS LLC
THIS AGREEMENT FOR PROFESSIONAL SERVICES (herein “Agreement”) is made and entered into this 23 day of September , 2025 by and between the CITY OF BANNING, a municipal corporation whose address is 99 E. Ramsey Street, Banning California 92220 (“City”) and CITY MANAGEMENT ADVISORS LLC d.b.a. Peckham & McKenney, a California limited liability company whose address is 5452 Manitowac Dr, Rancho Palos Verdes, California 90275 (“Consultant”). City and Consultant are sometimes hereinafter individually referred to as “Party” and hereinafter collectively referred to as the “Parties.”

RECITALS
A. City has sought, by issuance of a Request for Proposal, Executive Recruitment Services for City Manager, dated July 29, 2025, the performance of the services for the recruitment of a city manager prepared in connection therewith, and as further defined and described particularly in Section 1 of this Agreement.

B. Consultant, following submission of a proposal or bid for the performance of the services defined and described particularly in Section 1 of this Agreement, was selected by the City to perform those services.

C. Pursuant to the City of Banning’s Municipal Code, City has authority to enter into this Agreement.

D. The Parties desire to formalize the selection of Consultant for performance of those services defined and described particularly in Section 1 of this Agreement and desire that the terms of that performance be as particularly defined and described herein.

AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises and covenants made by the Parties and contained herein and other consideration, the value and adequacy of which are hereby acknowledged, the Parties agree as follows:
1 Scope of Services. In compliance with all terms and conditions of this Agreement, the Consultant shall provide those services specified in the “Proposal” attached hereto as Exhibit “A” and incorporated herein by this reference, which services may be referred to herein as the “services” or “work” hereunder and which relate to the recruitment of a city manager acceptable 315
2 to and ultimately hired by the Banning City Council. As a material inducement to the City entering into this Agreement, Consultant represents and warrants that it has the qualifications, experience, and facilities necessary to properly perform the services required under this Agreement in a thorough, competent, and professional manner, and is experienced in performing the work and services contemplated herein. Consultant shall at all times faithfully, competently and to the best of its ability, experience and talent, perform all services described herein. Consultant covenants that it shall follow the highest professional standards in performing the work and services required hereunder and that all materials will be of good quality, fit for the purpose intended. For purposes of this Agreement, the phrase “highest professional standards” shall mean those standards of practice recognized by one or more first-class firms performing similar work under similar circumstances.
2 Consultant’s Proposal. This Agreement shall include the Request for Proposal or Invitation for Bids (“Contract Documents”) and the Proposal shall include the Consultant’s scope of work or in Consultant’s accepted proposal (“Accepted Proposal”) shall be incorporated herein by this reference as though fully set forth herein. In the event of any inconsistency between the Contract Documents, Accepted Proposal, and/or Agreement, the terms of this Agreement shall govern.
3 Compliance with Law. Consultant shall keep itself informed concerning, and shall render all services hereunder in accordance with all ordinances, resolutions, statutes, rules, and regulations of the City and any Federal, State or local governmental entity having jurisdiction in effect at the time service is rendered.
4 Licenses, Permits, Fees and Assessments. Consultant shall obtain at its sole cost and expense such licenses, permits and approvals as may be required by law for the performance of the services required by this Agreement. Consultant shall have the sole obligation to pay for any fees, assessments and taxes, plus applicable penalties and interest, which may be imposed by law and arise from or are necessary for the Consultant’s performance of the services required by this Agreement, and shall indemnify, defend and hold harmless City, its officers, employees or agents of City, against any such fees, assessments, taxes penalties or interest levied, assessed or imposed against City hereunder.
5 Familiarity with Work. By executing this Agreement, Consultant warrants that Consultant (i) has thoroughly investigated and considered the scope of services to be performed, (ii) has carefully considered how the services should be performed, and (iii) fully understands the facilities, difficulties and restrictions attending performance of the services under this Agreement.

If the services involve work upon any site, Consultant warrants that Consultant has or will investigate the site and is or will be fully acquainted with the conditions there existing, prior to commencement of services hereunder. Should the Consultant discover any latent or unknown 316
3 conditions, which will materially affect the performance of the services hereunder, Consultant shall immediately inform the City of such fact and shall not proceed except at City’s risk until written instructions are received from the Contract Officer (as defined in Section 17).

6. Care of Work. The Consultant shall adopt reasonable methods during the life of the Agreement to furnish continuous protection to the work, and the equipment, materials, papers, documents, plans, studies and/or other components thereof to prevent losses or damages, and shall be responsible for all such damages, to persons or property, until acceptance of the work by City, except such losses or damages as may be caused by City’s own negligence.

7. Further Responsibilities of Parties. Both Parties agree to use reasonable care and diligence to perform their respective obligations under this Agreement. Both Parties agree to act in good faith to execute all instruments, prepare all documents and take all actions as may be reasonable necessary to carry out the purposes of this Agreement. Unless hereafter specified, neither Party shall be responsible for the service of the other.

8. Additional Services. City shall have the right at any time during the performance of the services, without invalidating this Agreement, to order extra work beyond that specified in the Proposal or make changes by altering, adding to or deducting from said work. No such extra work may be undertaken unless a written order is first given by the Contract Officer to the Consultant, incorporating therein any adjustment in (i) the Contract Sum, and/or (ii) the time to perform this Agreement, which said adjustments are subject to the written approval of the Consultant. Any increase in compensation of up to $25,000, or in the time to perform of up to one hundred eighty (180) days may be approved by the Contract Officer. Any greater increases, taken either separately or cumulatively must be approved by the City Council. It is expressly understood by Consultant that the provisions of this Section shall not apply to services specifically set forth in the Proposal or reasonably contemplated therein. Consultant hereby acknowledges that it accepts the risk that the services to be provided pursuant to the Proposal may be more costly or time consuming than Consultant anticipates and that Consultant shall not be entitled to additional compensation therefor.

9. Facilities and Equipment. Except as otherwise provided, Consultant shall, at its own cost and expense, provide all facilities and equipment necessary to perform the services required by this Agreement. City shall make available to Consultant only physical facilities such as desk, filing cabinets, and conference space (“City Facilities”), as may be reasonably necessary for Consultant’s use while consulting with City employees and reviewing records and the information in possession of City. The location, quality, and time of furnishing City Facilities shall be in the sole discretion of City. In no event shall City be required to furnish any facilities that may involve incurring any direct expense, including but not limited to computer, long distance telephone, network data, internet or other communication charges, vehicles and reproduction facilities. 317
4 Notwithstanding the foregoing, it shall be the City’s responsibility to schedule, provide, and host all aspects of the interview process. This includes, without limitation, scheduling and providing facilities (e.g., location, tables, chairs, etc.); administrative supplies (e.g., easel/flip chart/markers, pads of paper, pens, etc.); and hospitality (e.g., water for candidates, lunch for City Council, etc.).

10. Compensation.

10.01 Consultant shall be paid at the rates set forth in the Proposal and shall not increase any rate without the prior written consent of the City. Notwithstanding anything in this Agreement to the contrary, total fees and charges paid by City to Consultant under this Agreement shall not exceed the amount of Thirty-Two Thousand Dollars($32,000).

10.02 Consultant shall not be compensated for any services rendered nor reimbursed for any expenses incurred in excess of those authorized unless approved in advance by the City, in writing.

10.03 One-third of the Compensation is due as a retainer upon execution of the Agreement. This retainer covers upfront and necessary expenses incurred by Consultant on the City’s behalf for the preparatory work and advertising. If the retainer is not received by Consultant within thirty (30) days of execution of the Agreement, Consultant will suspend the recruitment process until payment is received. The second one-third of the full payment will be invoiced at the closing date, and it is due within thirty (30) days following the invoice date. The final one-third of the full payment will be invoiced after the finalist interviews, and it is due within thirty (30) days following the invoice date.

10.04 Payment to Consultant for work performed pursuant to this Agreement shall not be deemed to waive any defects in work performed by Consultant.

11. Time of Essence. Time is of the essence in the performance of this Agreement.

12. Schedule of Performance. Consultant shall commence the services pursuant to this Agreement and shall perform all services within the time period(s) established in the Proposal.

When requested by the Consultant, extensions of the time period(s) specified in the Proposal may be approved in writing by the Contract Officer or City Council but not exceeding one hundred eighty (180) days cumulatively.

13. Force Majeure. The time period(s) specified in the Proposal for performance of the services rendered pursuant to this Agreement shall be extended because of any delays due to 318
5 unforeseeable causes beyond the control and without the fault or negligence of the Consultant, including, but not restricted to, acts of God or of the public enemy, unusually severe weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight embargoes, wars, litigation, and/or acts of any governmental agency, including the City, if the Consultant shall within ten (10) days of the commencement of such delay notify the Contract Officer in writing of the causes of the delay. The Contract Officer shall ascertain the facts and the extent of delay, and extend the time for performing the services for the period of the enforced delay when and if in the judgment of the Contract Officer such delay is justified. The Contract Officer’s determination shall be final and conclusive upon the Parties to this Agreement. In no event shall Consultant be entitled to recover damages against the City for any delay in the performance of this Agreement, however caused, Consultant’s sole remedy being extension of the Agreement pursuant to this Section.

14. Term. Unless earlier terminated in accordance with this Agreement, the term of this Agreement shall continue in full force and effect until completion of the services but not exceeding one (1) year from the date hereof. Maximum term and any subsequent amendment or modification shall not exceed five (5) years.

15. Representatives and Personnel of Consultant. The following principals of Consultant (Principals) are hereby designated as being the principals and representatives of Consultant authorized to act in its behalf with respect to the work specified herein and make all decisions in connection therewith:
_____________________ __________________
(Name) (Title)
It is expressly understood that the experience, knowledge, capability and reputation of the foregoing principals were a substantial inducement for City to enter into this Agreement.

Therefore, the foregoing principals shall be responsible during the term of this Agreement for directing all activities of Consultant and devoting sufficient time to personally supervise the services hereunder. All personnel of Consultant, and any authorized agents, shall at all times be under the exclusive direction and control of the Principals. For purposes of this Agreement, the foregoing Principals may not be replaced nor may their responsibilities be substantially reduced by Consultant without the express written approval of City. Additionally, Consultant shall utilize only competent personnel to perform services pursuant to this Agreement. Consultant shall make every reasonable effort to maintain the stability and continuity of Consultant’s staff and subconsultants, if any, assigned to perform the services required under this Agreement. Consultant shall notify City of any changes in Consultant’s staff and sub-consultants, if any, assigned to perform the services required under this Agreement, prior to and during any such performance. In the event that City, in its sole discretion, at any time during the term of this Agreement, desire to 319
6 reassign any staff or sub-consultant of Consultant, Consultant shall, immediately upon reassign notice from City of such desire of City, reassign such person or persons.

16. Status of Consultant. Consultant shall have no authority to bind City in any manner, or to incur any obligation, debt or liability of any kind on behalf of or against City, whether by contract or otherwise, unless such authority is expressly conferred under this Agreement or is otherwise expressly conferred in writing by City. Consultant shall not at any time or in any manner represent that Consultant or any of Consultant’s officers, employees, or agents are in any manner officials, officers, employees or agents of City. Neither Consultant, nor any of Consultant’s officers, employees or agents, shall obtain any rights to retirement, health care or any other benefits which may otherwise accrue to City’s employees. Consultant expressly waives any claim Consultant may have to any such rights.

17. Contract Officer. The Contract Officer shall be such person as may be designated by the City Council. It shall be the Consultant’s responsibility to assure that the Contract Officer is kept informed of the progress of the performance of the services and the Consultant shall refer any decisions which must be made by City to the Contract Officer. Unless otherwise specified herein, any approval of City required hereunder shall mean the approval of the Contract Officer.

The Contract Officer shall have authority to sign all documents on behalf of the City required hereunder to carry out the terms of this Agreement.

18. Independent Consultant. Neither the City nor any of its employees shall have any control over the manner, mode or means by which Consultant, its agents or employees, perform the services required herein, except as otherwise set forth herein. City shall have no voice in the selection, discharge, supervision or control of Consultant’s employees, servants, representatives or agents, or in fixing their number, compensation or hours of service. Consultant shall perform all services required herein as an independent Consultant of City and shall remain at all times as to City a wholly independent Consultant with only such obligations as are consistent with that role.

Consultant shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of City. City shall not in any way or for any purpose become or be deemed to be a partner of Consultant in its business or otherwise or a joint venture or a member of any joint enterprise with Consultant.

19. Prohibition against Subcontracting or Assignment. The experience, knowledge, capability and reputation of Consultant, its principals and employees were a substantial inducement for the City to enter into this Agreement. Therefore, Consultant shall not contract with any other entity to perform in whole or in part the services required hereunder without the express written approval of the City. In addition, neither this Agreement nor any interest herein may be transferred, assigned, conveyed, hypothecated or encumbered voluntarily or by operation of law, whether for the benefit of creditors or otherwise, without the prior written approval of City. 320
7 Transfers restricted hereunder shall include the transfer to any person or group of persons acting in concert of more than twenty-five percent (25%) of the present ownership and/or control of Consultant, taking all transfers into account on a cumulative basis. In the event of any such unapproved transfer, including any bankruptcy proceeding, this Agreement shall be void. No approved transfer shall release the Consultant or any surety of Consultant of any liability hereunder without the express consent of City.

20. Insurance Coverages. Consultant hereby agrees to be solely responsible for the health and safety of its employees and agents in performing the services under this Agreement and shall comply with all laws applicable to worker safety including but not limited to Cal-OSHA.

Therefore, throughout the duration of this Agreement, Consultant hereby covenants and agrees to maintain insurance in conformance with the requirements set forth below. Attached hereto as Exhibit “B” are copies of Certificates of Insurance and endorsements as required by Section

21.02. If existing coverage does not meet the requirements set forth herein, Consultant agrees to amend, supplement or endorse the existing coverage to do so. Consultant shall provide the following types and amounts of insurance:

20.01 Commercial general liability insurance in an amount of not less than $1,000,000 per occurrence and $2,000,000 in the aggregate; Consultant agrees to have its insurer endorse the general liability coverage required herein to include as additional insured’s City, its officials, employees and agents. Consultant also agrees to require all Consultants and subconsultants or subcontractors to provide the same coverage required under this Section 20.

20.02 Professional Liability Insurance (Errors & Omission – Technology Exposure – Other Considerations). Choose and check one: Required _X_ /Not Required __; Consultant will file with City, before beginning professional services, a certificate of insurance satisfactory to City evidencing professional liability coverage of not less than $1,000,000 per occurrence and $2,000,000 policy aggregate.

20.03 Business Auto Coverage in an amount no less than $1 million per accident.

If Consultant or Consultant’s employees will use personal autos in performance of the services hereunder, Consultant shall provide evidence of personal auto liability coverage for each such person.

20.04 Workers’ Compensation coverage for any of Consultant’s employees that will be providing any services hereunder. Consultant will have a state-approved policy form providing statutory benefits as required by California law. The provisions of any workers’ compensation will not limit the obligations of Consultant under this Agreement. Consultant expressly agrees not to use any statutory immunity defenses under such laws with respect to City, its employees, officials and agents.
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8 21. General Conditions pertaining to Insurance Coverage.

21.01 No liability insurance coverage provided shall prohibit Consultant from waiving the right of subrogation prior to a loss. Consultant waives all rights of subrogation against City regardless of the applicability of insurance proceeds and shall require all Consultants and subconsultants or subcontractors to do likewise.

21.02 Prior to beginning the services under this Agreement, Consultant shall furnish City with certificates of insurance, endorsements, and upon request, complete copies of all policies, including complete copies of all endorsements. All copies of policies and endorsements shall show the signature of a person authorized by that insurer to bind coverage on its behalf.

21.03. All required policies shall be issued by a highly rated insurer with a minimum A.M. Best rating of “A:VII”). The insurer(s) shall be admitted and licensed to do business in California. The certificates of insurance hereunder shall state that coverage shall not be suspended, voided, canceled by either party, or reduced in coverage or in limits, except after thirty (30) days' prior written notice has been given to City.

21.04 Self-insurance does not comply with these insurance specifications.

Consultant acknowledges and agrees that that all insurance coverage required to be provided by Consultant or any sub-consultants or subcontractor shall apply first and on a primary, noncontributing basis in relation to any other insurance, indemnity or self-insurance available to City.

21.05 All coverage types and limits required are subject to approval, modification and additional requirements by City, as the need arises. Consultant shall not make any reductions in scope of coverage (e.g. elimination of contractual liability or reduction of discovery period) that may affect City’s protection without City’s prior written consent.

21.06 Consultant agrees to provide immediate notice to City of any claim or loss against Consultant or arising out of the services performed under this Agreement. City assumes no obligation or liability by such notice but has the right (but not the duty) to monitor the handling of any such claim or claims if they are likely to involve City.

22. Indemnification. Consultant shall indemnify, defend (with counsel approved by City), and hold harmless City and City's elected officials, officers, directors, employees, agents, representatives, successors, and assigns (collectively, "City Indemnified Parties") from and against all damages, whether ordinary, direct, indirect, incidental, special, consequential, or exemplary, judgments, liabilities, fines, penalties, losses, claims, actions, demands, lawsuits, costs, and 322
9 expenses (including, without limitation, reasonable attorneys' fees, expert costs, court costs, and defense costs) that arise from or relate to: (i) Consultant's negligent acts or omissions or willful misconduct in connection with this Agreement; (ii) Consultant's breach of the terms and conditions of this Agreement; or (iii) Consultant's failure to comply with applicable state, federal or local laws, rules, or regulations.

23. Records. Consultant shall keep, and require sub-consultants to keep, such ledgers books of accounts, invoices, vouchers, canceled checks, reports, studies or other documents relating to the disbursements charged to City and services performed hereunder (the “books and records”), as shall be necessary to perform the services required by this Agreement and enable the Contract Officer to evaluate the performance of such services. Any and all such documents shall be maintained in accordance with generally accepted accounting principles and shall be complete and detailed. The Contract Officer shall have full and free access to such books and records at all times during normal business hours of City, including the right to inspect, copy, audit and make records and transcripts from such records. Such records shall be maintained for a period of three (3) years following completion of the services hereunder, and the City shall have access to such records in the event any audit is required. In the event of dissolution of Consultant’s business, custody of the books and records may be given to City, and access shall be provided by Consultant’s successor in interest.

24. Reports. Consultant shall periodically prepare and submit to the Contract Officer such reports concerning the performance of the services required by this Agreement as the Contract Officer shall require. Consultant hereby acknowledges that the City is greatly concerned about the cost of work and services to be performed pursuant to this Agreement. For this reason, Consultant agrees that if Consultant becomes aware of any facts, circumstances, techniques, or events that may or will materially increase or decrease the cost of the work or services contemplated herein or, if Consultant is providing design services, the cost of the project being designed, Consultant shall promptly notify the Contract Officer of said fact, circumstance, technique or event and the estimated increased or decreased cost related thereto and, if Consultant is providing design services, the estimated increased or decreased cost estimate for the project being designed.

25. Ownership of Documents; Audit.

25.01 All draft and final reports, plans, drawings, studies, maps, photographs, specifications, data, notes, manuals, warranties and all other documents of any kind or nature prepared, developed or obtained by Consultant in connection with the performance of services performed for the City shall become the sole property of City, and Consultant shall promptly deliver all such materials to City upon request. At City’s sole discretion, Consultant may be permitted to retain original documents, and furnish reproductions to City upon request, at no cost to City.
323
10 25.02 Subject to applicable federal and state laws, rules and regulations, City shall hold all intellectual property rights to any materials developed pursuant to this Agreement.

Consultant shall not use such data or documents for purposes other than the performance of this Agreement, nor shall Consultant release, reproduce, distribute, publish, adapt for future use or any other purposes, or otherwise use, any data or other materials first produced in the performance of this Agreement, nor authorize others to do so, without the prior written consent of City.

25.03 Consultant shall retain and maintain, for a period not less than four years following termination of this Agreement, all-time records, accounting records and vouchers and all other records with respect to all matters concerning services performed, compensation paid, and expenses reimbursed. At any time during normal business hours and as often as City may deem necessary, Consultant shall make available to City’s agents for examination all of such records and shall permit City’s agents to audit, examine and reproduce such records.

26. Confidentiality and Release of Information.

26.01 All information gained or work product produced by Consultant in performance of this Agreement shall be considered confidential, unless such information is in the public domain or already known to Consultant. Consultant shall not release or disclose any such information or work product to persons or entities other than City without prior written authorization from the Contract Officer.

26.02 Consultant, its officers, employees, agents or sub-consultants, shall not, without prior written authorization from the Contract Officer or unless requested by the City Attorney, voluntarily provide documents, declarations, letters of support, testimony at depositions, response to interrogatories or other information concerning the work performed under this Agreement. Response to a subpoena or court order shall not be considered “voluntary” provided Consultant gives City notice of such court order or subpoena.

26.03 If Consultant, or any officer, employee, agent or sub-consultant of Consultant, provides any information or work product in violation of this Agreement, then City shall have the right to reimbursement and indemnity from Consultant for any damages, costs and fees, including attorney’s fees, caused by or incurred as a result of Consultant’s conduct.

26.04 Consultant shall promptly notify City should Consultant, its officers, employees, agents or sub-consultants be served with any summons, complaint, subpoena, notice of deposition, request for documents, interrogatories, request for admissions or other discovery request, court order or subpoena from any party regarding this Agreement and the work performed there under. City retains the right, but has no obligation, to represent Consultant or be present at 324
11 any deposition, hearing or similar proceeding. Consultant agrees to cooperate fully with City and to provide City with the opportunity to review any response to discovery requests provided by Consultant. However, this right to review any such response does not imply or mean the right by City to control, direct, or rewrite said response.

27. Governing Law; Venue. This Agreement shall be interpreted, construed and governed both as to validity and to performance of the Parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Riverside, State of California, or any other appropriate court in such county, and Consultant covenants and agrees to submit to the personal jurisdiction of such court in the event of such action. In the event of litigation in a U.S. District Court, venue shall lie exclusively in the Central District of California, in Riverside.

28. Disputes; Default. In the event that City determines Consultant is in default under the terms of this Agreement, the City shall not have any obligations or duty to continue compensating Consultant for any work performed after the date of default. Instead, the City may give notice to Consultant of the default and the reasons for the default. The notice shall include a timeframe in which Consultant may cure the default. This timeframe is presumptively thirty (30) days, but may be extended, though not reduced, if circumstances warrant. During the period of time that Consultant is in default, the City shall hold all invoices and shall, when the default is cured, proceed with payment on the invoices. In the alternative, If the Consultant disputes the City’s determination of default, the matter shall be submitted to binding arbitration in accordance with American Arbitration Association (“AAA”) with venue being held in Riverside County, California. Pending resolution of the dispute, the City shall hold all invoices related to the alleged default period. Upon resolution through arbitration, payment of such invoices shall be made consistent with the arbitration decision. Any failure on the part of the City to give notice of the Consultant’s default shall not be deemed to result in a waiver of the City’s legal rights or any rights arising out of any provision of this Agreement.

29. Retention of Funds. City may not withhold or deduct from any amount payable to Consultant under this Agreement without Consultant’s prior written approval. Consultant’s approval shall not be unreasonably withheld where withholding is necessary to (i) address amounts in dispute hereunder, (ii) compensate City for actual, documented losses, costs, liabilities, or damages caused by Consultant, or (iii) cover amounts for which City has been determined legally liable to third parties by reason of Consultant’s acts or omissions in the performance of Consultant’s obligations under this Agreement. In the event that a third-party claim is made, the amount or validity of which is disputed by Consultant, or any indebtedness shall exist which appears to be the basis for a claim of lien, City may request Consultant’s written authorization to withhold from any payment due an amount sufficient to cover such claim; provided, however, that 325
12 no such withholding shall occur without Consultant’s express prior written approval. The failure of City to exercise its right to seek withholding shall not affect Consultant’s obligation to insure, indemnify, and protect City as otherwise provided herein.

30. Waiver. Waiver by any Party to this Agreement of any term, condition, or covenant of this Agreement shall not constitute a waiver of any other term, condition, or covenant. Waiver by any Party of any breach of the provisions of this Agreement shall not constitute a waiver of any other provision or a waiver of any subsequent breach or violation of any provision of this Agreement. Acceptance by City of any work or services by Consultant shall not constitute a waiver of any of the provisions of this Agreement. No delay or omission in the exercise of any right or remedy by a non-defaulting Party on any default shall impair such right or remedy or be construed as a waiver. Any waiver by either Party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Agreement.

31. Rights and Remedies are Cumulative. Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the Parties are cumulative and the exercise by either Party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party.

32. Legal Action. In addition to any other rights or remedies, either Party may take legal action, in law or in equity, to cure, correct or remedy any default, to recover damages for any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Agreement.

Notwithstanding any contrary provision herein, Consultant must file a statutory claim pursuant to Government Code Sections 905 et seq. and 910 et seq., in order to pursue a legal action against City under this Agreement.

33. Termination of Agreement.

33.01 Notwithstanding any other provision of this Agreement, either party, at its sole option, may terminate this Agreement with or without cause, or for no cause, at any time by giving thirty (30) days’ written notice to the other party.

33.02 In the event of termination, the payment of monies due Consultant for undisputed services performed prior to the effective date of such termination shall be paid within thirty (30) business days after receipt of an invoice as provided in this Agreement. Immediately upon termination, Consultant agrees to promptly provide and deliver to City all original 326
13 documents, reports, and the like which are in the possession or control of Consultant and pertain to City.

34. Attorney’s Fees. If either Party to this Agreement is required to initiate or defend or made a party to any action or proceeding in any way connected with this Agreement, the prevailing party in such action or proceeding, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorney’s fees. Attorney’s fees shall include attorney’s fees on any appeal, and in addition the Party entitled to attorney’s fees shall be entitled to all other reasonable costs for investigating such action, taking depositions and discovery and all other necessary costs the court allows which are incurred in such litigation. All such fees shall be deemed to have accrued on commencement of such action and shall be enforceable whether or not such action is prosecuted to judgment.

35. Non-liability of City Officers and Employees. No officer or employee of the City shall be personally liable to the Consultant, or any successor in interest, in the event of any default or breach by the City or for any amount which may become due to the Consultant or to its successor, or for breach of any obligation of the terms of this Agreement.

36. Conflict of Interest. Consultant covenants that neither it, nor any officer or principal of its firm, has or shall acquire any interest, directly or indirectly, which would conflict in any manner with the interests of City or which would in any way hinder Consultant’s performance of services under this Agreement. Consultant further covenants that in the performance of this Agreement, no person having any such interest shall be employed by it as an officer, employee, agent or sub-consultant without the express written consent of the Contract Officer. Consultant agrees to at all times avoid conflicts of interest or the appearance of any conflicts of interest with the interests of City in the performance of this Agreement. No officer or employee of the City shall have any financial interest, direct or indirect, in this Agreement within the scope of Government Code section 1090, nor shall any such officer or employee make, participate in making, or use his or her official position to influence, any City decision relating to the Agreement which has a material financial effect on his or her financial interests or the financial interests of any corporation, partnership or association in which he or she is, directly or indirectly, interested, in violation of any State statute or regulation. The Consultant warrants that it has not paid or given and will not pay or give any third party any money or other consideration for obtaining this Agreement.

37. Covenant Against Discrimination. Consultant covenants that, by and for itself, its heirs, executors, assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, gender, sexual orientation, marital status, national origin, or ancestry in the performance of this Agreement. Consultant shall take affirmative action to insure that applicants 327
14 are employed and that employees are treated during employment without regard to their race, color, creed, religion, sex, marital status, national origin, or ancestry, or other protected class.

38. Unauthorized Aliens. Consultant hereby promises and agrees to comply with all of the provisions of the Federal Immigration and Nationality Act, 8 U.S.C.A. §§ 1101, et seq., as amended, and in connection therewith, shall not employ unauthorized aliens as defined therein.

Should Consultant so employ such unauthorized aliens for the performance of work and/or services covered by this Agreement, and should the any liability or sanctions be imposed against City for such use of unauthorized aliens, Consultant hereby agrees to and shall reimburse City for the cost of all such liabilities or sanctions imposed, together with any and all costs, including attorneys’ fees, incurred by City.

39. Notices. Any notice, demand, request, document, consent, approval, or communication either Party desires or is required to give to the other Party or any other person shall be in writing and either served personally or sent by prepaid, first-class mail, in the case of the City, to the City Manager and to the attention of the Contract Officer, CITY OF BANNING, 99 East Ramsey Street, Banning, CA 92220 and in the case of the Consultant, to the person at the address designated on the execution page of this Agreement. Either Party may change its address by notifying the other Party of the change of address in writing. Notice shall be deemed communicated at the time personally delivered or in seventy-two (72) hours from the time of mailing if mailed as provided in this Section.

40. Interpretation. The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either Party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply.

41. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, and such counterparts shall constitute one and the same instrument.

42. Integration; Amendment. This Agreement including the attachments hereto is the entire, complete and exclusive expression of the understanding of the Parties. It is understood that there are no oral agreements between the Parties hereto affecting this Agreement and this Agreement supersedes and cancels any and all previous negotiations, arrangements, agreements and understandings, if any, between the Parties, and none shall be used to interpret this Agreement.

No amendment to or modification of this Agreement shall be valid unless made in writing and approved by the Consultant and by the City Council. The Parties agree that this requirement for written modifications cannot be waived and that any attempted waiver shall be void.

43. Severability. In the event that any one or more of the phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable by 328
15 a valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or sections of this Agreement which are hereby declared as severable and shall be interpreted to carry out the intent of the Parties hereunder unless the invalid provision is so material that its invalidity deprives either Party of the basic benefit of their bargain or renders this Agreement meaningless.

44. Corporate Authority. The persons executing this Agreement on behalf of the Parties hereto warrant that (i) such Party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Agreement on behalf of said Party, (iii) by so executing this Agreement, such Party is formally bound to the provisions of this Agreement, and (iv) the entering into this Agreement does not violate any provision of any other Agreement to which said Party is bound.

This Agreement shall be binding upon the heirs, executors, administrators, successors and assigns of the Parties.
[SIGNATURE ON FOLLOWING PAGE]
329
16 IN WITNESS WHEREOF the Parties hereto have executed this Agreement the day and year first hereinabove written.

CITY OF BANNING CONSULTANT
____________________ __________ ____________________ __________ , Date Name: Date
City Manager Title:
____________________ __________
Name: Date
Title:

ATTEST:
__________________________________
____________________ __________ Tax ID No.

Date
City Clerk
APPROVED AS TO FORM:
____________________ __________
John Pinkney, Date
City Attorney
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17 EXHIBIT “A”

PROPOSAL
[ATTACHED BELOW]
331
18 EXHIBIT “B”

CERTIFICATES OF INSURANCE AND ENDORSEMENTS
[ATTACHED BELOW]
332
Peckham & McKenney
July 30, 2025
Mayor Sheri Flynn, Mayor Pro Tem Richard Royce,
and Councilmembers Cindy Barrington, Leroy Miller, and Collen Wallace City of Banning
c/o Nicole Jews, Human Resources Manager
99 E. Ramsey Street
Banning, CA 92220
Via PDF/Email To: [email protected]
Dear Mayor Flynn and Members of the City Council,
Thank you for considering Peckham & McKenney for the City of Banning recruitment for City Manager.

Peckham & McKenney would be honored to work with the City in this important search. We look forward to the opportunity to specifically find exceptionally skilled and experienced candidates that will work effectively with you, serve City residents and the community, and work successfully with the staff team.

Peckham & McKenney is a well-established and experienced, honest and communicative, hardworking, and service oriented firm. We are known for achieving successful and long-term placements. As a firm that only conducts recruitments for cities, counties and special districts – and primarily in California, some of our distinguishing attributes include:
• We actively and personally search for, find, and pursue candidates throughout California and the nation.

We don’t act as a supermarket and wait for (or expect) prospective applicants to simply find a position on our website, in an ad, or from social media. Through an extensive personal and corporate network, and with a keen understanding of what our client is looking for, we market your opportunity and use the telephone and LinkedIn along with text, email and social media to find candidates. • We limit the number of concurrent searches in order to directly focus on serving our client. • We prioritize a respectful, thorough, responsive, communicative, and complete process to represent our client in the best light, keep everyone informed, and make the recruitment process a positive experience.

Furthermore, we communicate with applicants and treat them with respect. • Your Recruiter is personally, solely, and directly responsible for all aspects of the search; your Recruiter is also your one point of contact. In other words, your Recruiter who knows about the City and the responsibilities of the vacant position handles all components of the recruitment (for example, preparing the Candidate Profile, conducting outreach, reviewing applicants, presenting applicants, facilitating interviews, and conducting reference checks).
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Peckham & McKenney
The Peckham & McKenney team is comprised of retired municipal managers and directors who are passionate about the public sector. As a Recruiter with Peckham & McKenney and as owner of the firm, I am proud to work with our team because we value and prioritize assisting public agencies in furtherance of good government; placing quality above quantity; and building long lasting relationships with those in the public service.

For this important position and search, I will serve as your Recruiter. As a retired City Manager, previously on the CalCities Executive Board representing City Managers throughout the State, and successful Recruiter, I know the skills and knowledge needed for an applicant to be successful as a City Manager, and am wellconnected to find candidates. Furthermore, as a resident of Los Angeles County that has a second family home in the Coachella Valley, I am very familiar with the City of Banning and the region.

Attached are two examples of a Candidate Profiles that illustrate the information we collect, detail and utilize as a foundation for attracting applicants. Also attached is our proposal that explains what we will do for the City, our search process, the completed form in the Request for Proposals, and our exceptions to the agreement. I hope the information provided is sufficient and if not, I’m pleased to answer questions and discuss. For our service, we are proposing a fee of $32,050 that I am also pleased to discuss and address with you. I would also be pleased to participate in an interview to meet you, present our proposal, discuss our process and share the unique attributes of our search firm.

We are excited for the opportunity to implement the process leading to the successful placement of a candidate that “fits” the City’s interests and we are ready to start immediately. Please feel free to call me at 310.567.1554 if there are any questions.

Sincerely,
Anton “Tony” Dahlerbruch
Executive Recruiter
[email protected]
Enclosure:

City of Banning – City Manager Search Proposal
Completed RFP Form
Exceptions to Agreement
Candidate Profile Example (City of Santee and City of Santa Maria) 334
Peckham & McKenney
City of Banning

RECRUITMENT PROPOSAL
for
City Manager
July 30, 2025
335
Peckham & McKenney

TABLE OF CONTENTS
WHY CHOOSE US? 1
EXPERIENCE 2
YOUR RECRUITMENT TEAM 4
THE SEARCH PROCESS AND SCHEDULE 6
COST OF SERVICES 7
Cost of Services
Process of Payment
Insurance
GUARANTEE AND DIVERSITY 8
Guarantee
Diversity Statement
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1/ Peckham & McKenney
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Peckham & McKenney 2/

EXPERIENCE
With our recruitment team that solely consists of retired City Managers, Assistant City Managers, Police Chiefs and Department Heads, and our expert support team, Peckham & McKenney brings more experience and knowledge of local government and executive search than any other California recruiter. A few of our most recent recruitments related specifically to City Manager have been:
• Assistant City Manager, City of Indio, CA
• City Manager, City of Manteca, CA
• City Manager, City of Milpitas, CA
• City Manager, City of Malibu, CA
• City Manager, City of San Luis Obispo, CA
• City Administrator, City of Santa Barbara, CA
• City Manager, City of Santa Maria, CA
• City Manager, City of Santee, CA (current)
• City Manager, City of Stockton, CA (current)
• City Manager, City of Sunnyvale, CA
• Deputy Town Manager, Town of Yucca
Valley, CA
Please don’t hesitate to contact these agencies as well as our large list of current and former clients on our website (here); they will attest to our quality of service, on-going communication throughout the process, personal and direct outreach and sourcing of candidates, quality applicant pool, written materials and interview facilitation.

As an ambassador of our clients, Peckham & McKenney is also known for maintaining ongoing communications with our applicants throughout the search process, treating every applicant with respect, and appropriately informing candidates to support their best effort. The numerous compliments we have received from applicants fairly illustrate this reputation.

Comfortable and Professional Experience
“I’d like to thank you again for your support
and guidance throughout the recruitment and
selection process. It was a comfortable and
professional experience, and I attribute a great
deal of that to you. It’s my hope that our
professional paths may cross again in the
future.” Candidate
Straightforward, Friendly, and Humane
Recruitment Process
“I wanted to let you know what a terrific job I
thought you and Peckham & McKenney did on the
recruitment. It was absolutely the most
straightforward, friendly, and humane recruitment
process I’ve ever participated in. And I would feel
the same way even if the outcome was not
successful for me.” Candidate
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Peckham & McKenney 3/
Testimonials from clients and candidates are at https://www.peckhamandmckenney.com/testimonials.

Please feel free to contact any of the following current and recent clients to inquire about their experience with Peckham & McKenney. In addition, we would be pleased to furnish the client contact and phone numbers for any past clients listed in this proposal. A few references are as follows:

City of Santa Maria, CA – City Manager
Mayor Alice Patino and / or David Rowlands, City Manager (805) 925-0951 x 2188; [email protected] or (805) 925.0951 x2200; [email protected] City of San Luis Obispo, CA – City Manager
Mayor Erica Stewart, Members of the City Council and / or Whitney McDonald, City Manager (805) 540-1154; [email protected] or (805) 781-7114; [email protected] City of Santa Barbara, CA – City Administrator
Mayor Randy Rowse, Members of the City Council and / or Kelly McAdoo, City Administrator (805) 564-5322; [email protected] or (805) 564-5305; [email protected] City of Santee, CA – City Manager
Rida Freeman, Human Resources Director and / or Shawn Hagerty, City Attorney (619) 258-4100 x 131; [email protected] or (619) 347-4837; [email protected] You Made Me Feel So Comfortable
“This is my first time working with a recruiting
company, and I’m so happy for having the
opportunity to work with your company, wow! I
truly enjoyed the process! Your interview skills
are amazing! You made me feel so comfortable
and I felt like I was just talking shop with a
longtime friend. Thanks for the personal touch
that you include in your job, I believe that this is
what makes your firm so desirable and
successful.” Candidate
Proactive and Responsive
Diana worked with the City to fill the Chief of Police
position early in 2023. Diana is clearly well respected in the LEO community and has a vast network
which led to a competitive pool of candidates for the
City to select from. Diana was proactive from our
very first meeting and always very responsive. The
City team valued Diana’s integrity, opinion and sense
of humor. She was a pleasure to work with and I
wouldn’t hesitate to hire her for any executive
recruitment critical to your organization. Client
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4/ Peckham & McKenney

YOUR RECRUITMENT TEAM
Our Approach
With every Peckham & McKenney recruitment, your
Recruiter has the entire Peckham & McKenney team of
Recruiters and administrative personnel for backup, support, collaboration, and sourcing. However, when you retain
Peckham & McKenney, your Recruiter serves as your single point of contact throughout the entire search process and is fully responsible for its success. Moreover, in order to fully focus on your search and finding applicants that fit with the ideal candidate you are seeking, your Recruiter also maintains no more than 6 active searches.

The Executive Recruiter for you in this search is Tony Dahlerbruch.

Tony Dahlerbruch, Executive Recruiter
Managing Member (owner) of Peckham & McKenney Executive Search Tony worked in local government over 30 years before joining the Peckham & McKenney team. His experience spans most every city department in the Cities of Beverly Hills, California; Scottsdale and Phoenix, Arizona; and Rockville, Maryland, with ultimately serving a combined 12 years as City Manager in Rolling Hills and Palos Verdes Estates, California. Tony has represented the City Managers Department in CalCities as a two term Director on the Executive Board, President of City Managers Department, and member of numerous Policy Committees. He has also served as a Regional Vice President on the Executive Board of the International City/County Management Association. Tony holds a Bachelor of Arts in Political Science from the University of California at Santa Barbara and a Master of Public Administration from The American University in Washington, D.C.

Tony is supported by the following team.

Joyce Johnson, Operations Manager
Joyce Johnson joined Peckham & McKenney in 2005 and serves as the firm’s Operations Manager. She has over 30 years' experience in the field of administrative and executive support for all aspects of the executive recruitment process. She oversees internal administration of the firm as well as directing contract administrative support in the areas of advertising and design, web posting, and duplication and mailing services. Prior to joining Peckham & McKenney, Ms. Johnson oversaw internal administration in the Western Region headquarters of two national management consulting and executive recruitment firms. Ms. Johnson is complimented regularly on her strong customer orientation working with both clients and candidates alike. Ms. Johnson holds an Associate of Arts degree from American River College.

Peckham & McKenney Team
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5/ Peckham & McKenney
Tayler Bergstrom, Research Assistant
Tayler Bergstrom joined Peckham & McKenney in 2022 and currently serves as a Research Associate. Tayler is currently pursuing a PhD at UCLA where she worked previously as a lab manager overseeing various research projects. Prior to that, Tayler graduated from UC San Diego with a Bachelor of Science degree in Psychology.

Linda Pucilowski, Graphic Designer
With nearly 30 years of experience, Linda Pucilowski provides her expert design and marketing skills to Peckham & McKenney. She is the firm’s “go-to” professional for all advertising and brochure design and creation. Ms. Pucilowski holds a Bachelor’s degree from California State University, Sacramento.

Rachel Moran, Website & Social Media Assistant
Rachel Moran has been in the graphic design field since 2007 and prides herself on creating eye-catching visual art. She supports the Peckham & McKenney team by handling all website visual and technical design as well as social media. Ms. Moran graduated from the Art Institute of Houston obtaining her Bachelor’s Degree in Fine Arts with a concentration in Graphic Design.
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6/Peckham & McKenney
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7/ Peckham & McKenney
The proposed fee to conduct the search process for your next City Manager is $32,050. We are pleased to discuss and address this. The fee is an all-inclusive for the services to achieve success in your search as described below.

Additional services can be provided and negotiated accordingly. 343
8/ Peckham & McKenney
• We will connect with the City in 6 months and 1 year after the appointment to check-in,
• We will conduct a second search within 6 months of our search process if a candidate is not placed, and
• If the placement vacates the position within 1 year from the date of accepting the offer, we agree to conduct a second search within 6 months of the vacancy as follows:

Because of how we conduct recruitments, it is unusual that we are unsuccessful in providing a placement, an individual is not placed, or the placement vacates the position within a year. In the unlikely event that no qualified candidates are identified as a result of the search efforts, and it is mutually agreed that the result is due to the search effort and/or process, we will extend the search for a second time for $7,200 (expenses). Otherwise, if a second search is necessary, a qualified applicant is not selected, or the selected candidate is separated from employment within 1 year after accepting the offer, a second search will be conducted within 6 months for the discounted fixed fee of $27,000 (external candidates only, and except in the event of budgetary cutbacks, promotion, position elimination, or illness/death, etc.).
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No
Legal Company Name: City Management Advisors
State Entity Number: 210912710047
I.A Type of Business*
☐C Corporation ☐ S Corporation
☐Limited Liability C Corporation ☐ Partnership
☐Limited Liability Partnership ☐ Sole Proprietor/Individual ☐ Other
*Response required
I.B Type your Legal Company Name Here*
State your Company's Name Here. This will be verified against the California Secretary of State's Website.
*Response required
I.C EX PARTE COMMUNICATIONS CERTIFICATION*
I certify that Bidder and Bidder’srepresentatives have not had any communication with a City Councilmember concerning this RFP at any time after the date and time that this was publicly released.
☐Yes
*Response required
I.D EX PARTE COMMUNICATIONS CERTIFICATION CONTINUED*
If stated "Yes" above, please explain the circumstances in the following space, or state "None." *Response required
I.E DISQUALIFICATIONS QUESTIONNAIRE*
Has the Company, any officer of the Company, or any employee of the Company who has proprietary interest in the Company, ever been disqualified,removed, or otherwise prevented from bidding on, or completing a federal, state, or local government project because of a violation of law or safety regulation?
☐Yes
*Response required
No
345
None (N/A)
I.F DISQUALIFICATIONS QUESTIONNAIRE CONTINUED*
If stated "Yes" above, please explain the circumstances in the following space, or state "None." *Response required
I.G DISCLOSURE OF GOVERNMENT POSITIONS*
Each Bidder shall disclose below whether any owner or employee of the firm currently hold positions as elected or appointed officials, directors, officers, or employees of a governmental entity or held such positions in the past twelve months. List below or state "None." *Response required
I.H CERTIFICATION COMPLIANCE*
There is nothing required here for this project.
346
years City Manager
City of Santee, California
347
Community
With its plentiful open space, vibrant
local economy, low crime rate, and
connectivity to several major transportation
corridors, the City of Santee (population
approximately 60,000) is a phenomenal
community to live, work and enjoy the
outdoors. Situated just 18 miles from San
Diego’s premier beaches to the west and the
Cleveland National Forest in the backdrop
to the east, and having over 260 days a year
of sunshine, recreational opportunities in
Santee are abundant. Excellent schools,
competitive housing, vibrant shopping
districts like Town Center and Trolley
Square, and a variety of local small
businesses enhance Santee’s unparalleled
quality of life in San Diego County.

As a family oriented community that
prides itself on its low crime rate,
excellent schools, exceptional special
events and a location where businesses
desire to be, the community shares a
vision, informed by its evolution and
history, for today and the future that is
articulated and guided by the City of
Santee Mission, Vision and Values. The
community embraces a mission that the
City honor the public trust and serve the
community by providing quality services
and programs that promote economic
prosperity, safety, social well-being and a
healthy environment.

The Organization
The City of Santee is a Charter City
operating under a Council/Manager
form of government. The City is
recognized as a very stable and lean
organization with an excellent and
highly committed professional team
that provides high level, effective and
efficient public services. The five members
of the City Council, comprised of the
Mayor who is elected at-large and four
Council members elected by district,
are responsible for appointing the City
Manager, City Attorney, and City Clerk.

The City Manager serves the Mayor
and City Council and is responsible
for implementing the City Council’s
goals and policies, providing policy
recommendations, administering the
Charter, and overseeing the effective and
efficient delivery of day-to-day public
services. The City Council models civility,
collaboration, and innovation, fostering
good governance and effective public
service delivery. The City Council, with a
conservative mindset, works exceptionally
well together and is committed to
excellence.

Through both contract services and
in-house personnel, the City provides
a broad range of municipal services.

Police, animal control, water and
wastewater services are provided
through third-parties. The current
2024-25 fiscal year budget consists of
approximately $61 million in General
Fund expenditures and a $13 million
General Fund undesignated reserve.

The 5-year capital improvement budget
includes a total of 68 projects totaling
approximately $375 million of which
$116 million is funded. A total of 156
funded positions provides services
through 13 Departments identified in
the budget: City Council, City Attorney,
City Manager, Information Technology,
Animal Control, City Clerk, Human
Resources and Risk Management,
Finance, Engineering, Planning
and Building, Community Services,
Law Enforcement Services, and Fire
and Life Safety. The City of Santee
contracts for police services with the San
Diego County Sheriff’s Department,
and Animal Control is provided by
contract with the San Diego Humane
Society. Water and wastewater services
are provided to the City through a
separate special district, the Padre Dam
Municipal Water District. The City has
one bargaining group and is currently in
the negotiation process.

For more information about the City,
please visit: www.cityofsanteeca.gov.
348
organizational culture,
and the vibrant,
engaged community.

The ideal candidate
will be motivated by
the desire to effect
transformative change
and establish a lasting
legacy. Santee provides
abundant opportunities for development,
champions innovation, and upholds the
highest standards of effective governance.

The City Manager will be a visionary
leader who prioritizes public safety,
ensures fiscal integrity, and actively
promotes Santee’s distinctive qualities
and attributes. The ideal candidate will:
• Make reasoned, educated, convincing
and defensible recommendations
and decisions. Welcome and
wholeheartedly support, promote,
defend, and implement City Council
decisions, regardless of personal
agreement.
• Embrace change, recognize and
pursue creative solutions, leverage
best practices, and employ new
technologies to achieve objectives
while removing roadblocks to success.
• Demonstrate emotional intelligence,
remain apolitical and build and
maintain trust with others.
• Engage in conversations with
community members and embrace
diversity.
• Be a lifelong learner and encourage the
same for the staff team, serving as a
resource and trusted advisor.
• Possess the attributes of a kind,
genuine, honest, and integrous leader.
• Ensure responsiveness to constituent
concerns.
• Treat others with respect.
• Pay attention to detail.

The Ideal Candidate
• An experienced, dynamic, visionary,
strategic, communicative, proactive
and results-oriented collaborator
and leader.
• Leads in a manner that attracts others
to be part of the team and solution.
• Recognizes that surprises to the City
and within city administration are not
advantageous to effective governance.
• Embraces both innovation and
technology to streamline operations,
leveraging systems like Microsoft 365,
EnerGov, and financial software to
enhance efficiency.
• Prioritizes public safety with strategic,
community-focused solutions to ensure
Santee remains a safe and welcoming
community.
• Demonstrates expertise in contract
negotiation and management to secure
favorable outcomes for the City.
• Proactively seeks solutions, builds
consensus, and finds ways to say “yes”
to advance City goals.
• Leads through fostering collaboration,
motivating and inspiring others,
and is skilled in guiding department
heads to formalize strategic plans,
track milestones, and maintain
accountability, while making tough
staffing decisions when necessary to
uphold performance standards. Has
courageous conversations.
• Serves as a team leader that values
training, coaching, empowerment, and
professional staff development.

The role of the Santee City Manager
offers a unique opportunity to lead with
impact, driven not only by the City’s
distinguished legacy of exemplary City
Councils, but also by its inclusive,
professional, and collaborative
2) Research, and if feasible, facilitate the
annexation of West Hills Parkway
and surrounding parcels.
3) Expand road paving and other
infrastructure improvements.
4) Develop and diversify economic
development opportunities through
the Arts & Entertainment District.
5) Drive full adoption of implemented
permitting software across all end
users, overcoming resistance and
ensuring successful organization-wide
utilization. Ensure implementation
of other technological improvements
including new website and financial
system upgrade.
6) Continue and expand the City’s
resolution to address local
homelessness.
7) Reduce pension unfunded liability.
8) Complete the Community Center
and Cannabis projects.

The City Manager
Position
The City Manager is responsible for
managing the City’s budget, ensuring
the day-to-day delivery of public services
through staff oversight, and implementing
the City Council’s priorities and policies.

For fiscal years 2023-24 and 2024-25, the
City Council’s priorities include:
1) Improve fire station facilities and
services.
349
The Recruitment
Process
To apply for this exciting career
opportunity, please visit our website:

Peckham & McKenney
www.peckhamandmckenney.com
Please do not hesitate to contact Anton
“Tony” Dahlerbruch at (310) 567-1554
or (866) 912-1919 if you have any
questions regarding this position or
recruitment process.

Desired
Qualifications
The preferred candidate will have at
least 5 years of leadership and financial
planning experience as a municipal Chief
Executive Officer, Assistant/Deputy
Chief Executive Officer, or Department
Head of comparable complexity. A
typical way of obtaining the knowledge,
skills and abilities for the position
includes 1) graduation from a college or
university with a Bachelor’s degree in
Public Administration or a related field,
2) progressively responsible experience in
a supervisory and managerial capacity,
and 3) familiarity with CEQA and
development related issues.

Compensation
The salary, currently approximately
$262,000, may be negotiated based on
qualifications and experience. The City of
Santee provides a wide range of excellent
benefits including the following:

Retirement: The City participates
in the California Public Employees’
Retirement System (CalPERS).

CalPERS members between 1/19/2012 –
12/31/2012 are at the 2% @ 55 retirement
formula, and employee pays 8% of the
contribution. All other members are at
the 2% @ 62 retirement formula, and
employee pays 7.75%. The City does
not contribute to Social Security. Other
contract provisions include: 1959 Survivor
Benefit – Level 3, Military Service Credit
for Public Service, Credit for Unused
Sick Leave, and $500 Post-Retirement
Death Benefit.

Health Insurance: City contributes
to Medical and Dental coverage provided
by Cigna. Vision benefits are available at
the employee’s cost.

Other Insurance:
• Group Term Life: One times
employee’s annual salary up to $50,000.
• Long Term Disability: Provides 2/3
of base monthly salary when disabled,
after a 60 day waiting period.
• Accidental Death and Dismemberment: One times employee’s annual salary up to $50,000.

Leaves
• Vacation: Accrued based on years of
service with up to 25 working days a
year with 24 years of service.
• Sick: 12 days (96 hours) per year.
• Holidays: 11 fixed holidays and 1
floating holiday per year. Holiday
Closure: Workdays between observed
Christmas Eve holiday and observed
New Year’s Day holiday.
• Administrative: 64 hours/fiscal yr.

Vehicle Allowance:
$350 per month.

Tuition Reimbursement: up to
$2,500 per year.

Relocation Expenses: Negotiable.

Other Benefits Available:
• Flexible Spending Account.
• 457 Deferred Compensation or
Roth IRA.

Search Schedule
Filing deadline ..................................................................July 18, 2025 Supplemental process (as necessary)..................July 21 – August 1, 2025 Recruiter meeting with City to review all applicants ...... August 4, 2025 In-person finalist interview process................... August 11 and 12, 2025 These dates have been confirmed, and it is recommended
that you plan your calendar accordingly.
www.peckhamandmckenney.com
350
years City Manager
City of Santa Maria, California
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The Community
The City of Santa Maria, located in the
California central coast region between
Santa Barbara and San Luis Obispo, is a
23 square mile growing and developing
community known for its agriculture,
affordable living, and local and regional
employment and recreation. As the
largest city in the County of Santa
Barbara, near Vandenberg Space Force
Base, conveniently adjacent to U.S.

Highway 101, and served by the local
Santa Maria Public Airport, Santa Maria
has a diverse population of approximately
110,000 residents (median age of 29)
and is a regional hub of commerce,
industry, farming, and housing. The
City is rapidly attracting new residents,
businesses and visitors, and downtown
revitalization is underway.

Recognized nationally as an All-America
City by the National Civic League, and
with multi-generational residents that
are vested and invested in the future
of the community, the City of Santa
Maria continues to be known as a great
community to work, live, and recreate.

Along with its signature “Santa Maria
Style Barbecue”; weekly Farmers’
Market; seasonal Downtown Fridays;
annual Santa Maria Elks Rodeo; parks
and hiking trails in the City and the
Santa Maria Valley; cultural attractions
including the Santa Maria Museum of
Flight, Santa Maria Valley Discovery
Museum, Pacific Conservatory Theater,
and the nearby Guadalupe-Nipomo
Dunes & Visitor Center; excellent local
schools, and proximity to local and
renown institutions of higher education
(Allan Hancock College, UC Santa
Barbara, and CalPoly); community
programs and events; rich farmland
producing numerous exported crops;
nearby beautiful beaches and over 30
wineries and tasting rooms for the public;
the City offers an excellent quality of life
along with being well positioned to grow
and prosper.

The Organization
The City of Santa Maria is a full-service
Charter City that operates under the
City Council – City Manager form of
government. The City Council consists
of the Mayor who is elected at-large
and four Council Members who are
elected by district. Each member of the
City Council serves a four-year term
and elections are staggered. The City
Clerk and City Treasurer are also elected
positions that each serve a four-year
term. In November 2024, an election
will be held for the Mayor, two Council
Members, the City Clerk, and City
Treasurer.

The City Council is responsible for
appointing the City Manager and City
Attorney. The City Manager serves the
Mayor and City Council in support of
the community by implementing the City
Council’s goals, policies and municipal
code, and overseeing day-to day public
services working with 10 operational
departments consisting of Police, Fire,
Community Development, Utilities,
Public Works, Library, Recreation
and Parks, Finance, City Attorney’s
Office and City Manager’s Office, with
a combined total of 732 authorized
full-time equivalents (FTEs) personnel.

The City Manager also oversees a total
2024-25 Budget of $363.9 million,
with an operating budget of $291.4
million incorporating a General
Fund appropriation of $139.8 million,
projected depleted reserves to cover a
$21 million General Fund shortfall, and
a sizable, exciting, and aggressive Capital
Improvement Program.

With its mission “Committed to
providing the highest quality service
in the most efficient, cost-effective,
and courteous manner possible”
through “teamwork, service, people,
communication, integrity, fiscal,
professional, progressive and responsive”
as its organizational values, the City has
an aggressive work plan and challenging
future with many opportunities.

The 2024-2026 Goals established
through a February 2024 strategic
planning workshop identified
“Long-term financial sustainability,
Community quality of life, Planning and
infrastructure, and Organizational wellbeing.” As such, the two-year budget relies on its three years of reserve funds
352
will be apolitical,
politically savvy, and
emotionally intelligent
to successfully immerse
themself in developing
and improving
City processes and
operations; facilitate
transformational
conversations leading to
action; and leverage their interpersonal
skills, knowledge, professional network
of resources to solve problems as a
reasoned and respected voice. As a
trusted resource and confidant of all
members of the City Council, the City
Manager will be genuine and authentic;
open, approachable, honest and direct;
strategy-oriented; inclusive, a continuous
learner; integrated into the fabric of
the community, a coach and mentor,
and communicative. Furthermore,
the effective City Manager will have
experience in labor relations, negotiations,
and working with bargaining groups. As
an empowering leader with integrity, the
City Manager will be a partner with staff.

To serve as City Manager, applicants
must have broad, unblemished, citywide
municipal management experience
in a full service city, leadership and a
successful track-record in the duties
and responsibilities of a City Manager
that encompasses working with elected
and appointed officials, community
engagement, personnel supervision,
knowledge of budget / finance, planning,
city operations and organizational
development in a full-service and
complex agency. Applicants should have
a Bachelor’s and Master’s degree. It is
desirable if candidates have served in a
community where Council Members are
elected by district, and have worked in an
organization with similarities to the City
of Santa Maria.
of a new landfill, development of
a new wastewater treatment plant,
implementation of a new financial
“enterprise resource system”, development
of a regional sports park, creation of a
business improvement district, future
land annexations, creation of employee
wellness programs, construction of a new
Fire training facility, and a number of
roadway and highway improvements.

The Ideal Candidate
The ideal candidate is forward thinking,
strategic, visionary, and experienced in
municipal government. The individual
should also be a servant leader with
excellent credentials who is creative,
innovative, and inspires others. To
be effective, the City Manager will
work closely with the City Council
in collaborating with the community
and local organizations, build and
maintain trust, and develop consensus.

Furthermore, the City Manager will be
an active listener for facilitating decision
making to recommend and implement
policies and organizational change.

The City Manager will represent the
City, its goals, and mission in the
community and regionally. In turn,
the ideal candidate will also have the
courage and fortitude, knowledge,
skills, and track record of experience
to implement innovative strategies that
address current projects and issues,
shape the future of the City, and
position the City for success. In addition,
applicants should have experience
managing growth, building partnerships,
facilitating urban and economic
development, addressing budget and
finance, championing large projects, and
implementing technology improvements.

As a forward-thinking, optimistic,
outgoing, and transformational leader
for placemaking, the City Manager
The staff is very professional, prides itself
in responsiveness and customer service,
is committed to providing complete staff
work, and dedicated to excellent public
service. The team works collaboratively
with the City Council and a very
supportive community to prioritize
and accomplish a variety of diverse and
competing interests.

The City of Santa Maria is a community
where good things are ready to happen
and a visionary is needed to develop and
lead the plan. With a mix of new and
long-tenured residents with phenomenal
opportunities for creativity, economic
development, housing, partnerships
and population growth, the City has
many transformational initiatives and
unrealized potential. Along with its
Smart City, Safe City initiative, some
of the exciting projects for the new
City Manager to champion include the
ongoing update to the General Plan,
transition of the bus fleet to electric
vehicles, creation of affordable housing,
development of a regional approach to fire
protection and flood control, construction
to address the City’s long-term structural
budget imbalance. Nonetheless, the
City has an excellent team of personnel,
attracts new employees, and has recently
filled several executive level positions.

The new City Manager will have the
tremendous opportunity to engage in
organizational development to build the
team; mentor, train, and professionally
develop personnel; and focus on
succession planning.
353
The Recruitment
Process
To apply for this key position and
exciting career opportunity, please visit
our website at:

Peckham & McKenney
www.peckhamandmckenney.com
Resumes are acknowledged within two
business days. Contact Anton “Tony”
Dahlerbruch at (310) 567-1554 or tollfree at (866) 912-1919, if you have any questions regarding this position or the
recruitment process.

The Compensation
The City Council is prepared to offer an
attractive and competitive salary that will
be determined based on the experience
and qualifications they bring to the
City of Santa Maria. The salary range
is $253,916 to $361,569. The starting
salary for the selected candidate will
reflect the candidate’s work experience
and track record of career success. The
City of Santa Maria offers an outstanding
benefits package, including:

Retirement
CalPERS: Tier 2 – CalPERS 2% @ 55;
3-year final average salary; Employee
required to pay entire members
contribution plus 2% of employer
contribution.

Tier 3 (PEPRA): CalPERS 2% @ 62;
3-year final average salary; Employee
required to pay 50% of the total “normal”
cost of the benefit (determined by
CalPERS annually) plus 2% of the
employer contribution.

Deferred Compensation: City will
contribute two percent (2%) of salary
per pay period toward an IRS-approved
401(a) plan. Employee can also contribute
to a 457 plan separately.

Leave
Vacation: Minimum 10 days, 21 days
maximum; can cash out up to 80 hours in
a calendar year.

Management: 80 hours/year.

Holidays: 7 (8 hour) holidays a year; and
eligible to receive, on a pro-rated basis,
48 hours of floating time a year to be
scheduled off or cashed out.

Sick: 12 days/year.

Insurance
Health: City contributes up to
$1,012.66/month toward a choice plan.

Dental/Vision: City pays for entire family.

Post-employment: City contributes
$100 per pay period to a fund that will
provide reimbursement for out-of-pocket
cost of qualified medical expenses and
medical insurance premiums upon
separation or retirement.

Other
Relocation/Housing assistance:

Negotiable
Telephone/PDA allowance: Up to
$115/month.

Auto allowance: $309.23 bi-weekly.

Flexible Schedule: 9/80 or 5/40 schedules
available and telework available.

Education Incentive: 5% for Master’s
Degree.

Tuition Reimbursement: Up to
$1,000 per calendar year.

Succession Planning: Educational
support, corporate Toastmasters club,
and more are offered to all employees
to advance and hone leadership skills to
ensure staff are growing leaders within
the organization.

Search Schedule
Filing Deadline:.......................................................... August 23, 2024 Supplemental Process, as needed: ..........August 26 – September 6, 2024 Recommendation of Candidates:............................ September 10, 2024 In-person interviews:.............................................. September 20, 2024 These dates have been confirmed, and it is recommended
that you plan your calendar accordingly.
www.peckhamandmckenney.com
354

CITY OF BANNING

STAFF REPORT
TO: CITY COUNCIL
FROM: Arturo Vela, Interim City Manager
PREPARED BY: David Newell, Community Development Director MEETING DATE: September 23, 2025
SUBJECT: Re-introduction and Adoption of Ordinance 1611, Approving a Development Agreement By and Between the City of Banning and JDNJ Enterprises, LLC, a Missouri Limited Liability Corporation, for the Banning Commerce Center Project by Sansone Group Previously Approved Under Council Resolutions 2025-106 and 2025-107 and Involve the Construction of a 1,320,284-Square Foot Industrial Warehouse Building on 131.28-acres of Land Generally Located North of the I-10 Freeway/E. Ramsey Street, East of N. Hathaway Street and Bisected by Wilson Street.

RECOMMENDATION:

Re-introduce and Conduct First Reading of, by Title Only, Ordinance 1611: An Ordinance of the City Council of the City of Banning, California, Approving a Development Agreement by and between the City of Banning and JDNJ Enterprises, LLC, a Missouri Limited Liability Corporation.

BACKGROUND:

At its regular meeting of July 8, 2025, the City Council held a public hearing and considered three applications (Case DR21-7017, TPM 38756 and a Development Agreement) for the Banning Commerce Center Project, which is a proposed industrial warehouse development of 1,320,284 square feet on 131.28-acre site located north of the I-10 freeway/E. Ramsey Street, east of N. Hathaway Street and bisected by Wilson Street. After closing the public hearing and deliberating, the Council voted 5-0 to approve the Project as follows:

1. Adopt Resolution 2025-107. This resolution certified Banning Commerce Center Project's EIR, adopted statements of overriding considerations and established the Mitigation Monitoring and Reporting Program.

2. Adopt Resolution 2025-106. This resolution approved the Design Review and Tentative Parcel Map applications for the Banning Commerce Center Project.

3. Introduce and conduct first reading of, by title only, Ordinance 1611. An Ordinance of the City Council of the City of Banning, California, Approving a Development Agreement by and between the City of Banning and JDNJ Enterprises, LLC, a Missouri Limited Liability Corporation.

Since the Council's meeting on July 8, 2025, staff has finalized the Development Agreement for execution, including the addition of (1) missing dates and references; (2) text to Section 17.C. to toll agreement and approvals in the event there is a third party challenge; (3) names for each party under signature lines; and (4) the current development impact fees applicable to the project in definitions and Exhibit B of the Agreement. Because these revisions are beyond corrections of typographical and clerical errors, Ordinance 1611 must be re-introduced for first reading under Government Code Section 36394, 355
which states, "When ordinances, other than urgency ordinances, are altered after introduction, they shall be passed only at a regular or at an adjourned regular meeting held at least five days after alteration.

Corrections of typographical or clerical errors are not alterations within the meaning of this section." JUSTIFICATION:

In order to approve the Development Agreement application, the City Council is required to make findings pursuant to BZO Section 17.60.030(C) (Development Agreement). The Planning Commission recommended approval of these applications pursuant to the findings in Planning Commission Resolution 2025-04. The Council conducted a hearing on July 8, 2025 and adopted the required findings included in the draft ordinance attached to this report. As noted above, the overall revisions to the Development Agreement associated with Ordinance 1611 are minor. After conducting a public hearing, Staff recommends the City Council conduct a new first reading of Ordinance 1611 by title only for approval of the Development Agreement.

Environmental Determination:

Ordinance 1611 remains consistent with the Council's action to certify the EIR under Resolution 2025- 107.

FISCAL IMPACT:

As described in the July 8, 2025 City Council Staff Report, fiscal impacts of the project will be offset by fees and improvement costs paid by the developer, including permit applications, impact fees, and roadway and other public improvements. In addition, the City will directly benefit financially by the following negotiated items, which are beyond the typical fees paid by a development application if the development agreement is approved:

1. $9,000,000 in payments to the City for funding transportation-related costs toward roadways/interchanges

2. $357,000 payment for per megavolt-amperes (MVA), based on the requested electrical load

3. $0.10 per sq. ft. annually (with annual CPI escalator) as part of a community facilities district to pay for on-going maintenance costs of public streets, public facilities and parks, and other related improvements and maintenance in the District; this would amount to over $132,000 in annual revenue to offset maintenance costs and other city services as specified in the CFD once established.

A fiscal impact analysis report prepared by the Developer's consultant anticipates this project would result in a net increase of recurring revenues amounting to $505,215 annually. The report cites total recurring revenues of $869,954 annually and total recurring expenditures of $364,739 annually, which results in the net increase of $505,215 to the City's annual revenues. The CFD would augment the annual revenue generated by the Project and provide an additional $132,000 annually toward maintenance and services within the boundary of the CFD once established, which further reduces impacts to the City's finances.

ALTERNATIVES:

Provide alternative direction to staff.

BUDGETED?:

No
CONTRACT/AGREEMENT:

Yes
ATTACHMENTS:

1. Development Agreement (Redline Copy 7-8-25 to 9-23-25)

2. Ordinance 1611
356

3. Development Agreement (Clean Copy 9-23-25)

4. Banning Commerce Ctr_PLN 21-7017_affidavit.pdf
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RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:

CITY OF BANNING
99 E. RAMSEY STREET
BANNING, CA 92220

BANNING, CALIFORNIA
ATTN: CITY CLERK
SPACE ABOVE THIS LINE FOR RECORDER’S USE
EXEMPT FROM RECORDING FEE PER GOVERNMENT CODE SECTION 6103

DEVELOPMENT AGREEMENT

BETWEEN

THE CITY OF BANNING
AND

JDNJ ENTERPRISES, LLC

CONCERNING

BANNING COMMERCE CENTER
Redline Copy of Changes 7-8-25 to 9-23-25
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{This Page Left Intentionally Blank}
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THIS DEVELOPMENT AGREEMENT (the “Development Agreement”) is made and entered into this {DATE OF AGREEMENT},September 25, 2025, by and between the City of Banning, a California municipal corporation (the “City”), and JDNJ Enterprises, LLC, a Missouri limited liability corporation qualified to do business in the state of California (“Developer”). City and Developer may be referred to in this Development Agreement collectively as the “Parties” or each individually as a “Party.”

RECITALS

1. Article 2.5 of Chapter 4 of Division 1 of Title 7 of the California Government Code (“Development Agreement Statute”) and Chapter 17.60 of the Banning Municipal Code authorizes City to enter into binding development agreements with persons having legal or equitable interests in real property for the development of such property.

2. Developer is proposing to develop an approximately 1,320,000 square-foot tilt-up industrial building consisting of 39,600 square feet of office space and 1,280,400 square feet of warehousing, and trailer parking on approximately 131.33 acres of real property located entirely within the City of Banning, comprised of three parcels having seven Assessor’s Parcel Number (Assessor’s Parcel Numbers (APNs):
532-030-008, 532-030-009, 532-080-008, 532-080-010, 532-090-026, 532-090- 028, 532-090-030, 532-110-015.), and more specifically depicted and described in Exhibit A (hereinafter the “Site”).

3. City and Developer mutually desire to enter into this Development Agreement pursuant to the Development Agreement Statute in order to implement the Project.

4. On July 8, 2025, the City Council adopted Resolution No. 2025-106 approving Tentative Parcel Map No. 38576 to reconsolidate all existing parcels on the Site into two (2) parcels; and Design Review No. 21-7017 for construction of one concrete tilt-up industrial building as described in the preceding recitals.

Resolution No. 2025-106 and any attachments and exhibits thereto is hereby incorporated by this reference.

5. For purposes of this Development Agreement, the approvals granted by Resolution No. 2025-106 are referred to herein as the “Project Approvals.”

6. On _______,August 26, 2025, the City Council adopted Ordinance No. 1611 approving this Development Agreement between the City and Developer and finding this Development Agreement to be consistent with the City’s General Plan and Zoning Code.

7. The terms and conditions of this Development Agreement have undergone extensive review by City staff and the City Council and have been found to be fair, just and reasonable. By electing to enter into this Development Agreement, the City agrees to bind future City Councils by the obligations specified herein and limit the future exercise of certain governmental and proprietary powers of the City; and 360
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further finds that the best interests of the citizens of the City and the public health, safety and welfare will be served by entering into this Development Agreement.

8. As set forth in the Project Approvals and this Development Agreement, development of the Site in accordance with this Development Agreement will further important policies and goals of the City, eliminate uncertainty in planning, provide for the orderly development of the Site, ensure progressive installation of necessary improvements, provide for public services appropriate to the development of the Project, and provide substantial community benefits.

9. Developer has incurred and will in the future incur substantial costs in order to assure development of the Site in accordance with this Development Agreement, and has incurred and will in the future incur substantial costs in excess of the generally applicable requirements in order to assure vesting of legal rights to develop the Site in accordance with this Development Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and other good and valuable consideration, the adequacy and receipt of which is hereby acknowledged, the Parties do hereby agree as follows:

AGREEMENT
SECTION 1. RECITALS
The Recitals are part of this Development Agreement and shall be enforceable as any other provision.

SECTION 2. DEFINITIONS
The following defined terms shall have the meanings set forth in this Section 2 unless a different meaning is clearly intended by the context in they are used.

A. “Development Agreement” means this Development Agreement.

B. “City” means the City of Banning.

C. “City Council” means the City Council of the City of Banning.

D. “City Manager” means the City Manager of the City of Banning.

E. “Developer” means JDN Enterprises, LLC, a Missouri limited liability corporation.

F. “Development Impact Fee Program” or “DIF Program” means City’s program of collection and use of development impact fees, including fees for Police Facilities, Fire Facilities, Parkland and Park Facilities, General City Facilities, Transportation Facilities, Wastewater Facilities, and Water Facilities (collectively “DIF”) as set forth in Banning City Council Resolutions 2019-112, as it may be amended or superseded, City’s Update of Traffic Fee Component of the Development Fee Program dated May 2019 and Development Impact Fee Update Study, dated 361
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August 7, 2019. The DIF Program also includes the regional MSHCP impact fee program imposed by the City in cooperation with Western Riverside County Regional Conservation Authority (“RCA”) and the TUMF impact fee program adopted by the City in cooperation with Western Regional Council of Governments (“WRCOG”).

G. “Effective Date” shall mean the date that Ordinance No. 1611 approving this Development Agreement becomes effective.

H. “Existing Development Regulations,” subject to the exclusions and reservations set forth in Section 7, means all ordinances, resolutions, codes, rules, regulations and official policies of the City in force as of the Effective Date and governing the development of the Project and use of the Site; including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, timing and phasing of development, the maximum height and size of buildings, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications.

I. “Municipal Code” means the Banning Municipal Code, as amended from time to time.

J. “Project” means the proposed development of the Site with 1,320,284 square-foot tilt-up industrial building consisting of 39,600 square feet of office space and 1,312,284 square feet of warehousing and trailer parking in a manner consistent with the Project Approvals and the terms and conditions of this Development Agreement.

K. “Project Approvals” means EIR 2022090102, SCH Number 2022090102, Tentative Parcel Map No. 38576 and Design Review No. 21-7017.

L. “Second Transportation Payment” shall have the meaning ascribed to it in Section 9(B) below.

M. “Site” means the real property that is the subject of the Project Approvals and as legally described in Exhibit A to this Development Agreement.

N. “Term” shall have the meaning ascribed to it in Section 6 below.

O. “Transfer” means any sale, lease, encumbrance, or other transfer of all or any portion of the Project or any interest therein.

P. “Transferee” means any person, partnership, limited liability company, joint venture, firm, or corporation who acquires an interest in the Site pursuant to a Transfer and assumes, or is deemed to assume, Developer’s obligations hereunder with respect to such interest.

Q. “Transportation Public Benefit Fee” shall have the meaning ascribed to it in Section 9(B) below.
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SECTION 3. DEVELOPER’S REAL PROPERTY INTEREST
Developer warrants and represents that, as of the Effective Date, it has or will have legal title to or an equitable interest in the Site; that it has full legal right to enter into this Development Agreement; and that the persons executing this Development Agreement on behalf of each Developer have been duly authorized to do so.

SECTION 4. RELATIONSHIP OF THE PARTIES
It is hereby specifically understood and acknowledged that the Project is a private development and that neither the City nor Developer will be deemed to be the agent of the other for any purposes whatsoever.

SECTION 5. BINDING EFFECT OF DEVELOPMENT AGREEMENT
A. Covenants, Reservations, and Restrictions. Developer hereby subjects the Project and the Property to the covenants, reservations, and restrictions as set forth in this Development Agreement. The City and Developer hereby declare their specific intent that the covenants, reservations and restrictions as set forth herein shall be deemed covenants running with the land and shall pass to and be binding upon each of Developer’s successors and assigns in title or interest to the Site. The Parties hereby further declare their understanding and intent that the benefit of such covenants, reservations, and restrictions touch and concern the land by enhancing and increasing the enjoyment and use of the Site by Developer and the future occupants of the Site, the intended beneficiaries of such covenants, reservations, and restrictions, and by furthering the public purposes for which this Development Agreement is adopted. Each and every contract, deed, or other instrument hereinafter executed, covering, or conveying the Site or any portion thereof shall conclusively be held to have been executed, delivered, and accepted subject to the covenants, reservations, and restrictions expressed in this Development Agreement, regardless of whether such covenants, reservations, and restrictions are set forth in such contract, deed, or other instrument.

B. Recordation. The City Clerk shall record this Development Agreement in the Official Records of the County Recorder of the County of Riverside within ten (10) days following the Effective Date. Upon the expiration or termination of this Development Agreement and the request of Developer, the City will execute and deliver, in recordable form, an instrument confirming that this Development Agreement is of no further force or effect.

SECTION 6. TERM
The Term of this Development Agreement shall commence on the Effective Date and shall expire fifteen (15) years thereafter (the “Initial Term”) unless terminated sooner as provided in this Development Agreement. Unless Developer is in default under this Agreement, the Term shall automatically be extended for an additional five (5) years if prior to the expiration of the Initial Term, the Developer has provided City with the initial Transportation Public Benefit Fee in the amount of Two Million Five Hundred Thousand Dollars ($2,500,000) as specified in Section 9.B. Unless otherwise specified in this 363
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Development Agreement, the respective rights and obligations of the Parties hereto shall remain in full force and effect throughout the Term. Notwithstanding any provision to the contrary herein, in the event that, for any reason whatsoever, Developer fails to acquire fee simple title to the Property ("Fee Title") within 180 days following the Effective Date ("Fee Title Deadline"), Developer may elect, in its sole and absolute discretion, with the written approval of the fee title owner, and upon written notice to the City within sixty (60) days following the Fee Title Deadline, to terminate this Agreement and the Project Approvals. Effective upon such termination by Developer and fee title owner, this Agreement and the Project Approvals shall be of no further force or effect. After the Fee Title Deadline, if Developer has failed to acquire Fee Title and the fee title owner does not issue written approval of termination of this Agreement within five (5) days after the Fee Title Deadline, Developer shall no longer be subject to any of the obligations created in this Agreement or in the Project Approvals.

SECTION 7. VESTING OF DEVELOPMENT RIGHTS
A. General Statement. As a material inducement to Developer and its lenders to continue with diligent efforts to promote the development of the Property, Developer shall have the vested right to develop the Project on the Site in accordance with the terms and conditions of the Project Approvals, this Development Agreement, and the Existing Development Regulations, and City shall have the right to control development of the Site in accordance with the provisions of the Project Approvals, this Development Agreement, and the Existing Development Regulations.

B. Existing Development Regulations. In accordance with the terms of Gov. Code, § 65866, City and Developer agree the development of the Project on the Site shall be subject to all ordinances, resolutions, codes, rules, regulations and official policies of the City in force as of the Effective Date and governing the development and of the Site, including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, timing and phasing of development, the maximum height and size of buildings, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications applicable to the development of the Site (collectively “Existing Development Regulations”) except as otherwise provided in this Development Agreement.

C. Exclusions and Reservations.

1. “Existing Development Regulations” excludes, and nothing in this Development Agreement shall preclude the application of, any municipal ordinance, resolution, code, rule, regulation or official policy, laws, and regulations that do not conflict with Developer’s vested rights to develop and use the Property in accordance with this Development Agreement.

Developer shall comply with such nonconflicting laws and regulations as may from time to time be enacted or amended hereafter.
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2. Without limitation to the foregoing exclusions or any nonconflicting law, City hereby expressly reserves its right with regarding to the Project and the Site to apply and enforce any municipal ordinance, resolution, code, rule, regulation or official policy, laws, or regulations regarding: (i) the conduct of businesses, professions, and occupations; (ii) taxes, fees, charges, and assessments; (iii) the control and abatement of nuisances; (iv) the granting of encroachment permits and the conveyance of similar rights and interests that provide for the use of or the entry upon public property; (v) the exercise of the power of eminent domain; (vi) any and all new health and safety regulations (e.g., fire, building, and seismic, plumbing, and electric codes) made applicable in the City, inclusive of any similar such codes based upon uniform codes and incorporated by reference into the Banning Municipal Code; and (vii) procedural rules of general city-wide application, provided that City agrees to nevertheless process any Minor Modifications to Tentative Parcel Map No. 38576 or Design Review No. 21-7017 pursuant to the Chapter 17.84 of the Banning Municipal Code as that Chapter reads as of the Effective Date regardless of any later Municipal Code amendment.

Such Minor Modifications may include modifications which do not: (a) alter the permitted uses of the Site; (b) increase the maximum height and size of permitted buildings or structures in excess of the originally approved Project; or constitute a project requiring a subsequent or supplemental environmental impact report pursuant to Public Resources Code § 21166.

D. Superior Law. Nothing in this Development Agreement shall preclude the application to the Project and the Site of those changes in City ordinances, regulations, plans, or specifications that are: (i) specifically mandated and required by changes in state or federal laws or regulations as provided in Government Code § 65869.5 or any successor provision or provisions; (ii) required to ensure public safety and are made applicable throughout the City; or (iii) required to ensure access under the Americans with Disabilities Act. In the event such changes prevent or preclude compliance with one or more of the provisions of this Development Agreement, such provisions of this Development Agreement shall be modified or suspended or performance thereof delayed, to the extent necessary to comply with such changes in the law.

SECTION 8. DEVELOPMENT TIMING; PERMIT PROCESSING
A. Developer’s Discretion. Because the California Supreme Court held in Pardee Construction Co. v. City of Camarillo, 37 Cal.3d 465 (1984), that failure to provide for the timing of development resulted in a later adopted initiative restricting the timing of development, it is the Parties’ intent to avoid that deficiency by acknowledging and providing that Developer shall have the right (without obligation), subject to the provisions of this Development Agreement, to complete the Project in such order and at such rate and at such times as Developer deems appropriate within the exercise of its subjective business judgment. 365
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B. Permit Processing. The City and its officers, agencies and departments shall not unreasonably delay the processing of any application for any permit or approval necessary to commence or complete the Project.

C. Provision of Real Property Interests by City. In any instance where Developer is required to construct any public improvement on land not owned by Developer, Developer shall at its sole cost and expense provide or cause to be provided, the real property interests necessary for the construction of such public improvements.

In the event Developer is unable, after exercising reasonable efforts over a period of at least 180 days to acquire the real property interests necessary for the construction of such public improvements (“Offsite Interests”), and if so requested by Developer and upon Developer’s provision of adequate security for costs City may reasonably incur as determined by City in its discretion, City may negotiate to attempt to purchase the Offsite Interests in order to allow Developer to construct the public improvements as required by the Project Approvals or this Development Agreement. If City is unable to acquire the Offsite Interests through a voluntary transaction, City shall consider acquiring the Offsite Interests through using its power of eminent domain to acquire such required real property interests. If City does elect in its discretion to exercise its power of Eminent domain, Developer shall pay all reasonable costs associated with such acquisition or condemnation proceedings as determined by City in its discretion and shall enter into a land acquisition agreement (“LAA”) with City in a form approved by the City Attorney.

The LAA shall provide among other things, that the Developer shall provide a deposit in an amount determined by the City to cover the City’s staff, legal and other expenses associated with the condemnation proceedings. This Section is not intended by the Parties to impose upon the Developer an enforceable duty to acquire land or construct any public improvements on land not owned by Developer, except to the extent that the Developer elects to proceed with the development of the Project, and then only in accordance with valid conditions imposed by City upon the development of the Project under the Subdivision Map Act or other legal authority. If after using good faith efforts to acquire the Offsite Interests, Developer is unable to acquire the Offsite Interests, and City, in its reasonable discretion, refuses to use its power of eminent domain to acquire the Offsite Interests, City shall waive the requirement for Developer to acquire the Offsite Interests, or if development of the Project cannot proceed without acquisition of the Offsite Interests, the Parties shall meet and confer in good faith to attempt to devise alternatives to allow the Project to proceed without acquisition of the Offsite Interests.

D. Subdivision Map Extension and Other Development Approvals. As permitted by Government Code § 66452.6, each subdivision or parcel map, heretofore or hereafter approved in connection with development of the Site or the Project shall be extended and shall remain in effect for the term provided by this Agreement. If Developer, in its sole and absolute discretion, chooses to process vesting tentative maps, City shall process such vesting maps subject to and in accordance with the Existing Land Use Regulations, the Subdivision Map Act. Subject to and in accordance with the Existing Land Use Regulations, and the Subdivision Map Act any tentative map, either vesting or non-vesting, may be processed in phases. In 366
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addition, Design Review No. 21-7017 and all subsequently adopted discretionary project approvals shall remain in effect for the term provided by this Development Agreement.

E. Development Impact Fees. Development Impact Fees (“DIF”) currently imposed are identified in Ordinance No. ___Resolution 2019-112 adopted by the City Council on _____, 20 __.September 10, 2019. “DIF” also includes TUMF and MSHCP. A schedule showing the DIF applicable to industrial uses only in place as of the Effective Date (excluding MSHCP and TUMF) is attached as Exhibit “B”. If other uses are sought by Developer the DIF for such use shall apply. DIF and sewer and water connection and capacity fees shall be those in effect at the time of the issuance of a building permit and due and payable by Developer prior to the issuance of the building permit for the building in question. For the sake of clarity, as a condition to building permit issuance for each industrial building, Developer shall pay the development impact fees listed on Exhibit “B” as well TUMF and MSHCP for such building in the amount in effect at the time the building permit for such building is issued, as well as any new or increased DIF authorized by this Agreement. TheFor the sake of clarity, Developer shall be subject to all increases and amendments to DIF at all times. Notwithstanding the forgoing, the City may apply subsequently adopted new categories of DIF to the Project if the same are applied uniformly to development either throughout the City or withwithin a defined area of benefit that includes the Property if the subsequently adopted DIF is not applied on an ad hoc basis solely to the Project and the subsequently adopted fee does not physically prevent development of the Property for the uses and to the density and intensity of development set forth in this Agreement. Notwithstanding the foregoing, if Developer is not in default under this Agreement and has made the initial Transportation Public Benefit Fee of Two Million Five Hundred Thousand Dollars ($2,500,000) as specified below, prior to first anniversary of the Effective Date, the City agrees not impose any new category of DIF on the Project for a period of Five Years after the Effective Date.

SECTION 9. PUBLIC BENEFITS
A. Intent. This Section sets forth the terms and conditions under which Developer agrees to provide public benefits in consideration of the of the benefits conferred on Developer and the Site by this Development Agreement.

B. Transportation Public Benefit Fee. Developer shall pay City a Transportation Public Benefit Fee in the amount of Nine Million Dollars ($9,000,000) (“Transportation Public Benefit Fee”).Two Million Five Hundred Thousand Dollars ($2,500,000) of the Transportation Public Benefit Fee will be paid no later than one (1) year from the Effective Date and the remaining amount of Six Million Five Hundred Thousand Dollars ($6,500,000) (“Second Transportation Payment”) prior to the issuance of the Project’s first building permit. If the Second Transportation Payment is not paid prior to the second anniversary of the Effective Date, the amount of the Second Transportation Payment will increase annually equal to the annual percentage change in the Consumer Price Index published by the U.S.

Bureau of Labor Statistics for “All Urban Consumers” in the Riverside-San 367
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Bernardino-Ontario Area, measured as of the month of April in the previous Fiscal Year, but not less than one percent (1%) and not greater than five percent (5%) .

The City shall solely use the Ramsey Interchange Fee for the design and construction of the Ramsey-Interstate 10 interchange and or the Hargrave Street interchange. The City acknowledges and agrees that the City shall not impose any other fee or exaction upon Developer for the Ramsey-Interstate 10 interchange.

C. Electrical Facilities Fee. Developer shall pay City an Electrical Facilities Fee equal to Three Hundred and Fifty-Seven Thousand Dollars ($357,000) per megavoltamperes (MVA) of requested electrical load due and payable pro rata prior to issuance of any building permit (“Electric Facilities Fee”). City shall use the proceeds of the Electrical Facilities Fee solely for the design or construction of new or expanded electrical facilities, which can include reimbursement to the City for part of the cost of an existing electrical facility substation which the City has funded.

D. Electrical Substation Land Dedication. Developer shall reserve and offer to dedicate to City lettered-lot “C” on the proposed Tentative Parcel Map No. 38576 for the Banning Electrical Utility to have the option to construct a new electrical substation (“Substation Property”). Such offer of dedication shall occur at the time final Parcel Map No. 38576 is recorded. If the City accepts the offer of dedication and undertakes construction of the electrical substation on the Substation Property, construction of the electrical substation shall be undertaken by the City at no cost to Developer. If the City accepts the offer of dedication for the Substation Property, City or its successors shall not use the Substation Property for any purpose other than a substation and related uses. If the City accepts the offer of dedication for the Substation Property, within thirty (30) days of City’s acceptance of the dedication, City shall pay the amount of the fair market value (“FMV”) of the Substation Property to the Developer, with the amount of the payment capped at the amount of the Electric Facilities Fee Acquisition of the Substation Property shall be at the sole discretion of the City and the City may in its sole discretion elect not to acquire the Substation Property.

E. Prior to the issuance of the first certificate of occupancy within the Project, the Developer shall be required to take all actions required to improve Hathaway Street, as depicted in Exhibit “C”.

F. The Developer shall use reasonable efforts to hire residents of the City of Banning.

Developer will hold at least one local job fair with the City for the purpose of recruiting workers from the City.

G. Sanitary Lift Station Land Construction and Dedication. Developer shall construct a sanitary lift station (“Lift Station”) on lettered lot “D” on the proposed Tentative Parcel Map No. 38576 (“Lift Station Property”) subject to plans and specifications approved by the Public Works Director and as contemplated by the Sewer Master Plan dated ___-.March 2018. City shall issue DIF credits against the wastewater DIF which includes the Lift Station and Lift Station Property in the amounts of (i) the cost of designing and constructing the Lift Station, and (ii) the FMV of the Lift 368
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Station Property (collectively, “Lift Station Costs”) in an amount not to exceed the Developer’s wastewater DIF obligation. Developer shall complete construction of the Lift Station prior to the issuance of the first certificate of occupancy for the Project. Developer is aware that the sewer force main near the Project running to Nicolet was installed by a previous developer on its property, and Developer must obtain the consent of the property owner to use this sewer force main for the Project and to undertake any additional improvements to the sewer force main at its sole cost and expense.

H. FMV Process. In order to determine the FMV of the Substation Property and the Lift Station Property, City shall commission an appraisal for each property, which shall be addressed to City and Developer, at Developer’s sole expense, prepared by a licensed appraiser holding a MAI designation from the Appraisal Institute (“Developer’s Appraiser”) with at least 15 years’ experience in appraising similar properties in the same geographical region. The FMV shall be based upon the assumption the Property has in place all needed discretionary approvals to develop a project similar in nature to the Project. The appraiser shall use a date of valuation which is the current date of the appraisal. Developer’s Appraiser shall deliver a written report as to their opinion of FMV for each property within sixty (60) days after such appraiser has been retained by Developer. Upon receipt of Developer’s appraisal, the City shall have thirty (30) days to review the appraisal and agree or dispute the determination of FMV. In the event that the City disputes the FMV determined by Developer’s appraisal, the City shall be entitled to commission a second appraisal, at the City’s own expense, prepared by a licensed appraiser having the qualifications provided above (“City’s Appraiser”). The City’s Appraiser shall deliver a written report as to their opinion of FMV for the property within sixty (60) days after such appraiser has been retained by the City. If the higher appraisal is equal to or less than 120% of the lower appraisal, the two appraisals will be added together and their total divided by two; the resulting quotient will be the FMV of the property in question. If the higher appraisal is greater than 120% of the lower appraisal, the Parties shall have sixty (60) days after Developer’s receipt of the City’s appraisal to reach a negotiated resolution. If the Parties are unable to reach a negotiation resolution, the Parties shall reasonably cooperate to select a third licensed appraiser having the qualifications provided above(“Review Appraiser”) to make a final determination of FMV. If the Parties are unable to agree on the selection of the Review Appraiser, the Parties shall jointly petition the Riverside County Superior Court to select a Review Appraiser. The Parties will equally share the fees and expenses associated with the Review Appraiser, including but not limited to, the Parties’ joint petition to select a Review Appraiser and the Review Appraiser’s fees. The Review Appraiser shall review the two appraisals and then make a determination of FMV, which shall be no less than the value of the lower appraisal and no greater than the value of the higher appraisal. The Review Appraiser’s determination of FMV shall be binding on all Parties.
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I. Community Facilities Districts.

1. Service CFD. Developer agrees, pursuant to the Mello Roos Act, to petition the City or, alternatively, California Statewide Communities Development Authority (“CSCDA”) to form a community facilities district, the boundaries of which shall be coextensive with those of the Site (the “Service CFD”) for the purpose of financing City services and ongoing maintenance of public improvements provided by the City to the parcels within the boundaries of the Service CFD the cost of which shall be solely borne by the Developer, provided such services qualify as authorized services under the Mello Roos Act (collectively, “Authorized Services”). The Service CFD shall be a condition to the City’s issuance of the first certificate of occupancy for the Project.

2. If City sponsors the formation of the Service CFD, City shall initiate the process promptly following submission of Developer’s petition and compliance with Section 53318(d) of the Mello-Roos Act and shall use good faith, diligent efforts to form the Service CFD, including the scheduling of necessary public hearings at the cost of Developer. If requested, Developer will execute a reimbursement agreement providing for the advance deposit of monies to reimburse City for the cost of its implementing the CFD.

Developer agrees to cooperate in the formation and agrees that it will not contest and will exercise all of its voting power in favor of the formation of the Service CFD. Should Developer request CSCDA to sponsor the formation of the Service CFD, City shall cooperate in process and agrees to use good faith efforts to take all necessary and appropriate actions to assist Developer and CSCDA in the formation of the Service CFD in accordance with Section 9.H.1, including the issuance of necessary consents in the formation process.

3. Developer and City shall reasonably cooperate in developing the rate and method of apportionment of special taxes for the Service CFD (“Service RMA”), which the Parties agree shall provide, in part: (a) the maximum Service Special Tax rate in the first year that there is a levy of the Service Special Tax shall be at a rate of $0.10 per building square foot, which amount shall be subject to an “Annual Escalation Factor” equal to the annual percentage change in the Consumer Price Index published by the U.S. Bureau of Labor Statistics for “All Urban Consumers” in the RiversideSan Bernardino-Ontario Area, measured as of the month of April in the previous Fiscal Year, but not less than three percent (3%) and not greater than five percent (5%); (b) the levying of the Service Special Tax shall commence in the first fiscal year following the issuance of a certificate of occupancy by May 1 of the preceding Fiscal Year, (c) the adoption of an annual budgeting process to establish the annual actual Service Special Tax rate, and (d) the Service Special Tax cannot be prepaid.

4. Facilities CFD At the discretion of the Developer, Developer may, pursuant to the Mello Roos Act, petition the City or, alternatively, pursue other 370
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financing alternatives, including requesting CSCDA to form a community facilities district, the boundaries of which shall be coextensive with those of the Site (“Facilities CFD,” collectively with Service CFD, the “CFDs”) for the purpose of financing (i) public infrastructure required under the Development Agreement, including without exception, public streets, highways, and bridges, and other related improvements such as grading, paving, curbs and gutters, sidewalks, street signalization and signage, street lights and parkway landscaping related thereto, water facilities, storm drain facilities, sewer facilities, public parks, landscaping, electrical facilities, (collectively, “Facilities”), and (ii) Development Impact Fees, including, without exception, the Public Benefit Fees described in Section B and C above (“Fees,” collectively with Facilities, “Authorized Facilities and Fees”).

If City agrees to sponsor the formation of the Facilities CFD, City shall initiate the process promptly following submission of Developer’s petition and compliance with Section 53318(d) of the Mello-Roos Act, and shall use good faith, diligent efforts to form the Facilities CFD and timely issue bonds (“CFD Bonds”), including the scheduling of necessary public hearings related to formation and issuance of CFD Bonds. Any costs incurrent in establishing the Facilities CFD and issuing the CFD Bonds shall be paid from the CFD Bond proceeds, or failing that by the Developer. Developer agrees to cooperate in the formation and agrees that it will not contest and will exercise all of its voting power in favor of the formation of the Facilities CFD and issuance of CFD Bonds. Should Developer request CSCDA to sponsor the formation of the Facilities CFD and be the issuer of the CFD Bonds, City shall cooperate in process and agrees to use good faith efforts to take cooperate with Developer and CSCDA in the formation of the Facilities CFD and the issuance of the CFD Bonds, including the issuance of necessary consents in the formation and bond issuance processes.

Developer and City shall reasonably cooperate in developing the rate and method of apportionment of special taxes for the Facilities CFD (“Facilities RMA”).

5. In the event Developer conveys or grants an easement to any portion of the Site to City or any other government agency and the property so conveyed is subject to payment of special taxes under the Facilities CFD formed pursuant to this Development Agreement and CFD Bonds have been issued and are outstanding, Developer shall prepay the special taxes pursuant to the terms of the Facilities RMA with respect to the portion of the Site subject to an easement or being conveyed prior to completion of any such conveyance or easement. Upon completion of the conveyance or grant of easement, Developer’s obligation to pay special taxes pursuant to the Facilities RMA and the Services RMA for the conveyed property shall terminate. Alternatively, the RMA may exclude the forgoing conveyance or grant of easement from the imposition of the special taxes to accomplish the goals of this paragraph.

6. Notwithstanding the foregoing, it is acknowledged and agreed by the Parties that nothing contained in this Development Agreement shall be construed 371
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as committing or requiring the City Council to authorize and approve the formation of the CFDs and/or the issuance of the CFD Bonds. Further, City and Developer agree that the practical ability to issue CFD bonds is subject to marketability and therefore, Developer and City will first consult with a mutually agreed upon public finance consultant, at Developer’s cost prior to forming a Facilities CFD.

7. Except as expressly set forth or reserved in this Development Agreement, City shall not, without the prior written consent of Developer, initiate the formation of any new financing district or assessment district involving the levy of special taxes or assessments for facilities or services applicable to the Project or any portion thereof during the term of this Agreement or prior to the substantial completion of the Project.

SECTION 10. COMPLIANCE REVIEW
Within ten (10) days of each anniversary of the Effective Date, Developer shall file a report with City containing sufficient evidence to demonstrate Developer’s good faith compliance with this Development Agreement, and City will review Developer’s report in good faith.

Pursuant to Gov. Code § 65865.1, if City finds and determines, as a result of its review, that there is substantial evidence that Developer has not complied in good faith with terms or conditions of this Development Agreement, City may terminate or modify the agreement. City does not waive any claim of defect in performance by Developer if after any annual review, City does not enforce this Development Agreement.

SECTION 11. TRANSFERS AND ASSIGNMENTS
A. Transfers. Developer shall have the right to sell, transfer or assign the Site in whole or in part (provided that no such partial transfer shall violate the Subdivision Map Act, Government Code § 66410 et seq.) to any person, partnership, limited liability company, joint venture, firm or corporation at any time during the Term of this Development Agreement without the prior consent of City. City acknowledges and agrees it is likely in the future that Developer may transfer its interest in the Site to an affiliated entity. Developer and Transferee shall execute and record an Assignment and Assumption Agreement whereby the assignee agrees to perform all of the obligations of the Developer under this Development Agreement, a copy of which shall be delivered to the City contemporaneously upon the closing of such sale, transfer or assignment. Upon recordation of the Assignment and Assumption Agreement, Developer shall be released from its obligations with respect to such portion of, or interest in, the Project that was the subject of such Transfer.

B. Conditions Applicable to Transfers. Notwithstanding whether a Transferee has executed an Assignment and Assumption Agreement, a Transferee shall be deemed upon transfer or assignment to have assumed all Developer’s obligations and to have been assigned all of Developer’s rights under this Development Agreement, and will be deemed the Developer hereunder. This Development Agreement may only be transferred to a person or entity who acquires fee title to the Site or any portion of the Site. Notwithstanding anything herein to the contrary, 372
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in no event shall any Lender (as defined in Section 12 below) have any obligation under this Development Agreement unless and until such Lender purchases at a foreclosure sale, or accepts a deed in lieu of foreclosure, the portion of the Site that was subject to a mortgage.

C. Release of Transferring Developer. Notwithstanding any transfer, a transferring Developer shall continue to be obligated under this Development Agreement until the full satisfaction by such transferring Developer of the following conditions and upon such satisfaction shall be released from the obligations under this Development Agreement: (i) Developer no longer has a legal or equitable interest in all or any part of the Site; (ii) Developer is not then in default under this Development Agreement; and (iii) Developer has provided City with the notice and executed agreement required under Section 11(A) above. If requested by transferring Developer, the City shall promptly memorialize such release in writing upon satisfaction of the foregoing conditions. A default under this Development Agreement by Developer shall not be considered or acted upon by the City as a default by the transferee and shall not affect the transferee’s rights or obligations hereunder,. Likewise, a default by a transferee relating to the transferred portion(s) of the Site shall not be considered or acted upon by the City as a default by Developer and shall not affect Developer’s rights and obligations hereunder.

Notwithstanding the forgoing, if a default of this Development Agreement is of a continuing nature that affects continued development of the Project including, but not limited to a failure to complete public improvements in accordance with the Project Approvals as needed to provide service to the Project or the payment of any tax, fee or assessment such default shall be the continuing responsibility of the transferee, if the transferee has accepted the obligation to complete public improvements.

SECTION 12. LENDERS
A. Rights of Lender. Should Developer place or cause to be placed any encumbrance or lien on the Project, or any part thereof, the beneficiary (“Lender”) of such encumbrance or lien shall have the right at any time during the Term of this Development Agreement and the existence of such encumbrance or lien to: (i) do any act or thing required of Developer under this Development Agreement, or cure any default of Developer under this Development Agreement within the time limits set forth in this Development Agreement, and any such act or thing done or performed by Lender or cure shall be as effective as if done by Developer; (ii) realize on the security afforded by the encumbrance or lien by exercising foreclosure proceedings or power of sale or other remedy afforded in law or in equity or by the security document evidencing the encumbrance or lien (hereinafter referred to as “a trust deed”); (iii) transfer, convey or assign the title of Developer to the Site to any purchaser at any foreclosure sale, whether the foreclosure sale be conducted pursuant to court order or pursuant to a power of sale contained in a trust deed; and (iv) acquire and succeed to the interest of Developer by virtue of any foreclosure sale, whether the foreclosure sale is conducted pursuant to a court order or pursuant to a power of sale contained in a trust deed. Should any Lender request an amendment of this Development Agreement in respect of the rights and 373
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remedies granted to a Lender, the City shall consider such an amendment in good faith and in accordance with state and local law so long as the proposed amendment does not materially and adversely affect the rights, powers, and remedies of the City in respect of a default by Developer hereunder.

B. Notice to Lender. City shall give written notice of any default or breach under this Development Agreement by Developer to Lender (if known by the City) simultaneously with such notice of default the City gives to Developer and afford Lender the opportunity after receipt of service of the notice to: (i) cure the breach or default within thirty (30) days after service of such notice, where the default can be cured by the payment of money; (ii) cure the breach or default within thirty (30) days after service of such notice where the breach or default can be cured by something other than the payment of money and can be cured within that time; or (iii) cure the breach or default in such reasonable time as may be required where something other than payment of money is required to cure the breach or default and cannot be performed within thirty (30) days after such notice, provided that acts to cure the breach or default are commenced within a thirty (30) day period after service of such notice of default on Lender by the City and are thereafter diligently completed by Lender.

C. Action by Lender. Notwithstanding any other provision of this Development Agreement, a Lender may forestall any action by the City for a breach or default under the terms of this Development Agreement by Developer by commencing proceedings to foreclose its encumbrance or lien on the Site. The proceedings so commenced may be for foreclosure of the encumbrance by order of court or for foreclosure of the encumbrance under a power of sale contained in the instrument creating the encumbrance or lien. The proceedings shall not, however, forestall any such action by the City for the default or breach by Developer unless: (i) they are commenced within thirty (30) days after service on Developer (and on Lender if Lender’s address is provided by notice to the City pursuant this Development Agreement) of the notice described hereinabove; (ii) they are, after having been commenced, diligently pursued in the manner required by law to completion within one year; and (iii) lender keeps and performs all of the terms, covenants, and conditions of this Development Agreement requiring the payment or expenditure of money by Developer until the foreclosure proceedings are complete or are discharged by redemption, satisfaction, or payment.

SECTION 13. NOTICES
Any notice or instrument permitted or required under this Development Agreement shall be deemed made when personally delivered or when mailed 72 hours after deposit in the United States Mail, certified mail postage prepaid and addressed to the party at the following addresses:

If to City: City of Banning
99 E. Ramsey Street
Banning, CA 92220
Attn: City Manager
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If to Developer JDNJ ENTERPRISES, LLC
120 South Central Avenue, Suite 500
St. Louis. MO 63105
Attn: John C. Condas
Allen Matkins Leck Gamble Mallory & Natsis LLP
2010 Main Street, Suite 800
Irvine, CA 92614
Actual notice shall be deemed adequate notice on the date actual notice occurred, regardless of the method of service.

SECTION 14. EVENT OF DEFAULT
Developer is in default under this Development Agreement upon the occurrence of one or more of the following events or conditions:

A. A material warranty, representation, or statement made or furnished by Developer to City set forth herein or in any document incorporated by reference herein is false or proved to have been false in any material respect when it was made.

B. City finds and determines upon the basis of substantial evidence following an annual review pursuant to this Development Agreement, that Developer has not complied in good faith with any material term and/or condition of this Development Agreement, subject to notice and opportunity to cure as provided by this Development Agreement.

C. Developer breaches any of the terms or conditions of this Development Agreement, after notice and opportunity to cure as provided in this Development Agreement.

SECTION 15. ENFORCEMENT
A. Notice; Cure. In the event of a default under the provisions of this Development Agreement by Developer or City, the non-breaching party shall give written notice to the defaulting party (or its successor) by registered or certified mail addressed at the address stated in this Development Agreement, and if such violation is not corrected to the reasonable satisfaction of the non-breaching party within thirty (30) days after such notice is served on the defaulting party, or if such breach or default cannot be cured within such thirty (30) days (excluding monetary defaults) and provided that acts to cure the breach or default must be commenced within such thirty (30) days and must thereafter be diligently pursued to completion by the defaulting party, then the non-breaching party may, without further notice, declare a default under this Development Agreement and, upon any such declaration of default, if the City is the defaulting party, Developer may bring any action necessary to specifically enforce the obligations of City. If Developer is the defaulting party, then City may give notice to Developer of its intent to terminate or modify this Development Agreement, in which event the matter shall be scheduled for consideration and review by the City Council.
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B. Remedies. The Parties acknowledge that money damages and remedies at law generally are inadequate and specific performance and other non-monetary relief are particularly appropriate remedies for the enforcement of this Development Agreement and should be available to the Parties for the following reasons: due to the size, nature, and scope of the Project, it may not be practical or possible to restore the Property to its natural condition once implementation of this Development Agreement has begun. After such implementation, Developer may be foreclosed from other choices it may have had to utilize the Site or portions thereof. Developer has invested significant time and resources and performed extensive planning and processing of the Project in agreeing to the terms of this Development Agreement and will be investing even more significant time and resources in implementing the Project in reliance upon the terms of this Development Agreement, and it is not possible to determine the sum of money which would adequately compensate Developer for such efforts. Accordingly, it is expressly recognized that injunctive relief and specific enforcement of this Development Agreement are proper and desirable remedies, and it is agreed that in any claim by Developer against City for an alleged breach of this Development Agreement may avail itself to injunctive relief or an appropriate action for specific enforcement of this Development Agreement. It is agreed that specific performance is not available to City against Developer, although City can seek the remedy of injunctive relief, declaratory relief or any other appropriate remedy against Developer.

C. Nonperformance by Developer. Nonperformance by Developer shall not be excused because performance by Developer of the obligations herein contained would be unprofitable, difficult, or expensive, or because of a failure of any third party or entity, other than City.

SECTION 16. PARTIES NOT LIABLE FOR DAMAGES
It is acknowledged by the Parties that the City and Developer would not have entered into this Development Agreement if either could be held liable in damages under or with respect to this Development Agreement or the application thereof. Consequently, and except for the payment of attorneys’ fees in accordance with this Development Agreement, the City shall not be liable in damages to Developer, or to any assignee, transferee, or any other person, and Developer shall not be liable in damages to City.

Developer and City jointly covenant on behalf of itself and its successors in interest not to sue for or claim any damages: (i) for any breach of this Development Agreement; (ii) for the taking, impairment or restriction of any right or interest conveyed or provided hereunder or pursuant hereto; (iii) arising out of or connected with any dispute, controversy, or issue regarding the application or interpretation or effect of the provisions of this Development Agreement; or (iv) for any injury to or interference with the rights of Developer, allegedly or actually arising out of, or incurred in connection with, the Parties entering this Development Agreement, or their exercise of any rights under this Development Agreement. Notwithstanding the forgoing, City shall not be excluded from seeking money damages for non-payment of the Electric Facilities Fee or the Transportation Public Benefit Fee, including attorney fees. In addition, Developer shall 376
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not be excluded from seeking its attorneys fees in the case of a breach of this Agreement by City.

SECTION 17. INDEMNIFICATION AND LEGAL CHALLENGE
A. Claims For Damage For Personal Injuries. To the maximum extent permitted by law, Developer must defend, indemnify, and hold the City and its elected officials, officers, contractors serving as City officials, agents, and employees (“Indemnitees”) harmless from liability for damage and/or claims for damage for personal injuries, including death, and claims for property damage, and with respect to all other actions and liabilities for damages caused or alleged to have been caused by reason of Developer’s activities in connection with the development and/or construction of the Project, and which may arise from the direct or indirect operations of Developer or those of Developer’s contractors, agents, tenants, employees, or any other persons acting on Developer’s behalf, which relate to the development and/or construction of the Project. This indemnity provision applies to all damages and claims for damage, as described above, regardless of whether or not the City prepared, supplied, or approved the plans, specifications, or other documents for the Project, including any associated public or private improvements.

B. Prevailing Wages. Without limiting the generality of the preceding paragraph (A), Developer shall defend, indemnify, and hold the Indemnitees harmless from and against any and all claims, liabilities, losses, damages, costs, and expenses arising from or related to any claims that Developer or Developer’s contractors are required to pay prevailing wages pursuant to Labor Code Section 1720 et seq., in connection with the development of the Project or any public improvements.

C. Third Party Legal Challenge. Without limiting the generality of preceding paragraph A, in the event of any legal action challenging the validity, applicability, or interpretation of any provision of this Development Agreement, any of the entitlement documents pertaining to the Project including, without limitation, the City’s General Plan, Zoning Code, or any other supporting document relating to the Project, Developer shall also indemnify, defend, and hold harmless the Indemnitees with respect to all liability, costs, and expenses incurred by, and/or awarded against, the City or any of the Indemnitees in relation to such action. In addition, the Term, the obligations imposed herein, and the lifespan of all Project Approvals, presently in existence or in existence in the future, shall be extended day for day based upon a timely filed lawsuit challenging the validity or legality of this Agreement and/or any of the Project Approvals, until the date on which said challenge is finally resolved. Developer and City shall promptly notify the other Party to this Agreement upon learning of the filing any such third party litigation.

D. Legal Counsel; Cash Deposit. With respect to any legal action or claim falling within Developer’s defense, indemnity, and hold harmless obligations, the City shall have the right to select counsel of its choice and the Parties shall cooperate in the defense. The City’s separate counsel billing rates shall be identical to the rates City pays for its typical municipal litigation rates for legal challenges of the 377
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variety being defended. Developer shall provide, and maintain for the duration of such action or claim, a cash deposit to City in an amount or amounts determined by the City Attorney to be reasonably necessary to cover the City’s legal fees, costs, and expenses. Developer shall not be entitled to a refund of funds expended from the deposit regardless of the outcome of the action or claim. The City shall refund to Developer any unexpended funds from the deposit within thirty (30) days of any final disposition or full and complete settlement of the action or claim.

E. Continued Effect of Development Agreement. In the event of any litigation challenging the effectiveness of this Development Agreement, or any portion hereof, this Development Agreement shall remain in full force and effect while such litigation, including any appellate review, is pending, unless otherwise ordered by the court. Absent issuance of an injunction, Developer may elect to continue development of the Project under this Development Agreement pending completion of the litigation but it shall do so at its sole risk, and the City shall not be liable for any loss suffered as a result thereof. City shall perform all obligations under this Development Agreement, including the timely processing of all applications submitted by Developer in connection with the Project.

F. Survival. This Section shall survive this the expiration or earlier termination of this Development Agreement. Notwithstanding the foregoing, Developer’s obligation to indemnify any Indemnitee due to personal injury or property injury suffered in connection with Developer’s design and construction of any public facility, shall terminate one (1) year after City accepts Developer’s dedication of such public facility.

SECTION 18. ENTIRE AGREEMENT
This Development Agreement and the Exhibits therein contain the entire agreement between the Parties, and is intended by the Parties to completely state the Development Agreement in full. Any agreement or representation respecting the matters dealt with herein or the duties of any Party in relation thereto, not expressly set forth in this Development Agreement, is null and void.

SECTION 19. AMENDMENT OR CANCELLATION
Except as otherwise provided for herein, this Development Agreement may be amended or canceled in whole or in part only by mutual consent of the Parties, or their successors in interest, and in the manner provided in Gov. Code, §§ 65865.1, 65867, 65867.5.

SECTION 20. OPERATING MEMORANDA
The provisions of this Development Agreement require a close degree of cooperation between the City and the Developer. It is anticipated due to the term of this Development Agreement that non-substantive interpretation of the Development Approvals may be appropriate with respect to the details of performance of the City and the Developer. To the extent allowable by law and this Development Agreement, the City and Developer shall retain a certain degree of flexibility with respect to all matters, items and provisions covered in general under this Development Agreement. The Developer may request 378
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minor changes, adjustments or clarifications under this Agreement and the City and Developer may effectuate such changes, adjustments or clarifications through operating memoranda (“Operating Memoranda”) approved by the Parties in writing, which reference this Section of the Development Agreement. Operating Memoranda shall not constitute an amendment to this Development Agreement but mere ministerial interpretations or clarifications; therefore, public notices and hearings shall not be required. The City Attorney shall be authorized, upon consultation with the Developer, to determine whether a requested interpretation or clarification may be effectuated pursuant to this Section or whether the requested clarification is of such character to constitute an amendment to the Development Agreement which requires compliance with the provisions of this Development Agreement pertaining to amendments. The authority to enter into such Operating Memoranda is hereby delegated to the City Manager, and the City Manager is hereby authorized in his or her discretion to execute any Operating Memoranda permitted hereunder without Planning Commission or City Council action and without public hearing.

SECTION 21. MISCELLANEOUS PROVISIONS
A. Binding Effect. This Development Agreement shall bind, and the benefits and burdens hereof shall inure to, the respective Parties hereto and their legal representatives, executors, administrators, successors and assigns, wherever the context requires or admits.

B. Headings. Headings used in this Development Agreement are for reference purposes only and shall not be deemed a part of this Development Agreement.

C. Exhibits. Each exhibit referenced in this Development Agreement is hereby incorporated into the Development Agreement as if set forth in full herein. In the event of any material discrepancy between the terms of any exhibit so incorporated and the terms of this Development Agreement, the terms of this Development Agreement shall control.

D. Time of Essence. Time is of the essence in every provision hereof in which time is a factor.

E. Force Majeure. In the event that any party hereto shall be delayed or hindered or prevented from performance of any act required hereunder by reason of acts of God, strikes, lockouts, labor troubles, riots, insurrection, terrorism, war, pandemics, epidemics or other reason of similar nature not the fault of the party delayed in performing the work or doing the acts required under the terms of this Development Agreement, then the performance of such act shall be excused for the period of the delay caused by the foregoing. Financial inability shall not be deemed an excuse for delay under this Section.

F. Waiver. No waiver of any default shall constitute a waiver of any other default or breach, whether of the same or other covenant or condition. No waiver, benefit, privilege, or service voluntarily given or performed by a party shall give the other party any contractual rights by custom, estoppel, or otherwise. 379
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G. Cooperation. Each of the Parties shall cooperate with and provided reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Development Agreement and the satisfaction of the conditions of this Development Agreement.

H. City Manager Authority. Any consent, approved or other instrument described in this Development Agreement may be granted, given or executed on behalf of the City by the City Manager or their written designee without the need for further authorization from the City Council; provided, however that, notwithstanding the foregoing, the City Manager or their designee may, in their sole discretion, refer to the City Council any item for which the City Manager has authority to act hereunder.

I. Conflicts of Interest; Prohibited Interests. Developer warrants and maintains as of the Effective Date of this Development Agreement that it has no knowledge that any officer or employee of City has any interest, whether contractual, noncontractual, financial, proprietary, or otherwise, in this transaction or in the business of Developer. If any information regarding an officer of employee of the City having an interest in this transaction or in the business of Developer as of the Effective Date of this Development Agreement comes to the knowledge of Developer at any time during the Term of this Development Agreement, Developer shall immediately make a complete, written disclosure of such interest to the City, even if such interest would not be deemed a prohibited “conflict of interest” under applicable laws. If the City subsequently is provided information that Developer had knowledge but failed to disclose knowledge of any such interest, and Developer fails to acknowledge such interest within 14 days of notification by the City, Developer’s failure shall constitute a breach of the Development Agreement subject to the provisions of Section 14 of this Development Agreement.

J. Applicable Law and Venue. This Development Agreement shall be construed in accordance with and governed by the laws of the State of California. Venue for any action or litigation brought for breach or to enforce any provision of this Development Agreement shall be the County of Riverside, California.

K. Partial Invalidity. If any provisions of this Development Agreement shall be deemed to be invalid, illegal, or unenforceable, the validity, legality, or enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby.

L. Attorneys’ Fees. In any proceedings arising from the enforcement of this Development Agreement or because of an alleged breach or default hereunder, the prevailing party shall be entitled to recover its costs and reasonable attorneys’ fees and experts’ fees incurred during the proceeding (including appeals) as may be fixed within the discretion of the court.

M. Corporate Authority. Each person executing this Development Agreement on behalf of Developer warrants that he or she is duly authorized to execute this 380
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Development Agreement on behalf of Developer and that by his or her execution, Consultant is formally bound to the provisions of this Development Agreement.

N. Counterparts. This Development Agreement may be executed by the Parties in counterparts, which counterparts shall be construed together and have the same effect as if all of the Parties had executed the same instrument.

O. No Third-Party Beneficiaries. This Agreement is made and entered into for the sole protection and benefit of the Parties and their successors and assigns. No other person shall have any right of action based upon any provision of this Development Agreement.

P. Legally Binding Contract; Enforceability. It is the intent of City and Developer that this Development Agreement is a legally binding contract which shall prevail over the provisions of any subsequently enacted moratoria, statutes, ordinances, limitations, or other measures, enacted by City, or under the authority of City by voter initiative or referendum, and which initiative, moratorium, referendum, statute, ordinance, limitation, or other measure relates, in whole or in part, to the rate, timing, sequence, or phasing of the development or construction of all or part of the Project or the improvements or affecting parcel or subdivision maps, building permits, occupancy certificates, or other entitlement to use the Site which are issued by City, subject only to the rights and powers reserved to City under the terms of this Development Agreement and the requirements of California law IN WITNESS WHEREOF, the undersigned have executed this Development Agreement as of the day and year first above-written.

CITY

CITY OF BANNING,
a California municipal corporation
By: __________________________
Sheri Flynn
Mayor
ATTEST:

By: __________________________
Marie CalderonVickie Sellers
City Clerk

DEVELOPER

JDNJDNJ ENTERPRISES, LLC,
a Missouri limited liability corporation
qualified to do business in California
By: __________________________
{Name}
{Title}
By:
{Name}
{Title}By: JDNJ, LLC, its Manager
By: JDN Holding Co., LLC, its Manager
By: __________________________
James G. Sansone, Manager
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APPROVED AS TO FORM:

By: __________________________
John O. Pinkney
City Attorney
By: __________________________
Douglas G. Sansone, Manager
By: __________________________
Nicholas G. Sansone, Manager
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EXHIBIT A
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EXHIBIT A

SITE LEGAL DESCRIPTION

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF BANNING,

COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

PARCEL 1:

THOSE CERTAIN PARCELS OF LAND LOCATED WITHIN THE MORONGO INDIAN

RESERVATION, LOCATED IN THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, BEING THOSE PORTIONS OF SECTION 1, 2 AND 12 OF TOWNSHIP 3 SOUTH, RANGE 1 EAST, SAN BERNARDINO MERIDIAN, AS SHOWN ON THE OFFICIAL PLAT THEREOF, MORE PARTICULARLY DESCRIBED AS FOLLOWS:

COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 2;

THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 SOUTH 89°40'06" EAST 489.00 FEET TO A LINE PARALLEL WITH AND 489.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 2, SAID POINT BEING THE TRUE POINT OF BEGINNING;
THENCE ALONG SAID PARALLEL LINE NORTH 00°21'44" EAST 342.00 FEET TO A LINE PARALLEL WITH AND 342.00 FEET NORTHERLY OF SAID SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2;
THENCE ALONG SAID PARALLEL LINE SOUTH 89°40'06" EAST 2164.30 FEET TO THE EASTERLY LINE OF SAID SECTION 2;

THENCE CONTINUING ALONG THE EASTERLY PROLONGATION OF SAID PARALLEL LINE SOUTH 88°36'14" EAST 107.02 FEET TO A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 1; THENCE ALONG SAID PARALLEL LINE SOUTH 00°17'18" WEST 270.81 FEET TO THE NORTHERLY LINE OF A STRIP OF LAND 16.50 FEET IN WIDTH, EXCEPTED FROM GRANT DEED REC. 10/7/2004 AS DOC. NO. 2004-0797131, OFFICIAL RECORDS OF THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA (DEPT. OF INT. FILING 582 173Y07);
THENCE ALONG SAID NORTHERLY LINE SOUTH 89°47'09" WEST 107.00 FEET TO THE WESTERLY LINE OF SAID SECTION 1;
THENCE ALONG SAID WESTERLY LINE SOUTH 00°17'18" WEST 16.50 FEET TO THE SOUTHERLY LINE OF THE AFOREMENTIONED 16.50 FOOT STRIP; 384
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EXHIBIT A
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THENCE ALONG SAID SOUTHERLY LINE NORTH 89°47'09" EAST 107.00 FEET TO A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 1;
THENCE ALONG SAID PARALLEL LINE SOUTH 00°17'18" WEST 52.58 FEET TO THE SOUTH LINE OF SAID SECTION 1, SAID POINT IS LOCATED ON A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 12; THENCE ALONG SAID PARALLEL LINE SOUTH 00°03'26" WEST 1044.17 FEET TO

THE NORTHERLY LINE OF THAT CERTAIN FINAL ORDER OF CONDEMNATION RECORDED AUGUST 19, 1963 AS INST. NO. 87113 AND THAT CERTAIN FINAL ORDER OF CONDEMNATION RECORDED SEPTEMBER 26, 1967 AS INST. NO. 84776, BOTH OF OFFICIAL RECORDS OF SAID COUNTY OF RIVERSIDE. SAID

NORTHERLY RIGHT OF WAY LINE BEING DEPICTED CALTRANS RIGHT-OF-WAY MAP NO. 984524 FILED IN BOOK 204 PAGE 91 OF CALTRANS RIGHT-OF-WAY MAPS AND CALTRANS RIGHT-OF-WAY MAP NO. 452194 FILED IN BOOK 205 PAGE 263 OF CALTRANS RIGHT-OF-WAY MAPS, BOTH ON FILE IN THE MISC. RECORDS OF THE OFFICE OF THE COUNTY SURVEYOR OF SAID COUNTY OF RIVERSIDE; THENCE ALONG SAID NORTHERLY RIGHT-OF-WAY SOUTH 71°02'58" WEST 113.17 FEET TO THE WESTERLY LINE OF SAID SECTION 2;
THENCE ALONG SAID WESTERLY LINE OF SECTION 12 NORTH 00°03'26" EAST 1081.36 FEET TO THE SOUTHEAST QUARTER OF THE AFOREMENTIONED SECTION 12;

THENCE ALONG THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SECTION 2 NORTH 88°36'14" WEST 2641.66 FEET TO THE SOUTH QUARTER CORNER OF SECTION 2;

THENCE ALONG THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2 NORTH 89°40'06" WEST 2161.30 FEET TO THE TRUE POINT OF BEGINNING;

RESERVING THEREFROM AN EASEMENT FOR INGRESS, EGRESS AND UTILITIES, MORE PARTICULARLY DESCRIBED AS FOLLOWS:

COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 2;

THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 SOUTH 89°40'06" EAST 2583.30 FEET TO A POINT 67.00 FEET WESTERLY OF THE SOUTH QUARTER CORNER OF SAID SECTION 2, SAID POINT IS THE TRUE POINT OF BEGINNING;
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EXHIBIT A
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THENCE NORTH 00° 21'44" EAST 342.00 FEET TO A LINE PARALLEL WITH 342.00

FEET NORTHERLY OF SAID SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2;
THENCE ALONG SAID PARALLEL LINE SOUTH 89°40'06" EAST 69.98 FEET TO A LINE PARALLEL WITH AND 342.00 FEET NORTHERLY OF THE SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 2;
THENCE ALONG SAID PARALLEL LINE SOUTH 88°36'14" EAST 30.02 FEET; THENCE SOUTH 00°21'44" WEST 342.06 FEET TO THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 2; THENCE ALONG SAID SOUTHERLY LINE NORTH 88°36'14" WEST 33.02 FEET TO THE SOUTH QUARTER CORNER OF SAID SECTION 2;

THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 NORTH 89°40'06" WEST 66.98 FEET TO THE TRUE POINT OF BEGINNING.

APN: 532-030-008, 532-030-009, 532-080-008, 532-080-010, 532-090-026, 532-090- 028 AND 532-090-030
PARCEL 2:

THAT PORTION OF THE NORTHEAST 1/4 OF SECTION 11, TOWNSHIP 3 SOUTH, RANGE 1 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO UNITED

STATES GOVERNMENT SURVEY, LYING NORTHERLY OF THAT CERTAIN PORTION OF SAID NORTHEAST 1/4 CONVEYED TO THE STATE OF CALIFORNIA BY DEED RECORDED OCTOBER 11, 1961, AS INSTRUMENT NO. 87046 IN BOOK 2997, PAGE 542, OFFICIAL RECORDS.

EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL

HYDROCARBONS, MINERALS, GEOTHERMAL RESOURCES, AND MINERAL ORES

OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, SOLID, LIQUID OR

GAS AND WHETHER OR NOT HEREAFTER KNOWN TO SCIENCE OR INDUSTRY,

NOT KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR

UNDERLYING THE SURFACE OF SAID LAND AS SHOWN IN DEED RECORDED JANUARY 28, 1987 AS INSTRUMENT NO. 24458 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA.

APN: 532-110-015
PARCEL 3:
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EXHIBIT A
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A NON-EXCLUSIVE EASEMENT FOR ROAD PURPOSES UPON, OVER AND ACROSS THAT PORTION OF THE EAST 1/2 OF THE NORTHWEST 1/4 OF SECTION 11, TOWNSHIP 3 SOUTH, RANGE 1 EAST, SAN BERNARDINO BASE AND MERIDIAN, INCLUDED WITHIN A STRIP OF LAND 20 FEET WIDE, THE NORTHERLY LINE OF WHICH IS DESCRIBED AS FOLLOWS:

BEGINNING AT A POINT IN THE EAST LINE OF THE SAID NORTHWEST 1/4, DISTANT ALONG SAID EAST LINE SOUTH 0°41'41" WEST 1359.31 FEET FROM A 3/4 INCH IRON PIPE AND BRASS CAP MARKED "U.S.G.L.O. 1917" SET FOR THE NORTH 1/4 CORNER OF SAID SECTION;
THENCE NORTH 89°25'57" WEST, 1319.31 FEET TO THE WEST LINE OF THE SAID EAST 1/2.

ALSO THAT PORTION OF THE WEST 20 FEET OF SAID EAST 1/2 LYING SOUTHERLY OF THE SOUTHERLY LINE OF THE ABOVE DESCRIBED 20 FOOT STRIP.

EXCEPT THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE:

BEGINNING AT A POINT IN THE WEST LINE OF SAID EAST 1/2, DISTANT ALONG SAID WEST LINE SOUTH 0°25'01" WEST 1041.97 FEET FROM THE POINT OF

INTERSECTION THEREOF WITH THAT CERTAIN LINE HEREINABOVE DESCRIBED AS HAVING A BEARING OF NORTH 89°25'57" WEST;
THENCE NORTHEASTERLY ALONG 545 FOOT RADIUS CURVE CONCAVE NORTHWESTERLY FROM A TANGENT BEARING NORTH 56°01'51" EAST, THROUGH AN ANGLE OF 1°46'36", A DISTANCE OF 16.90 FEET; THENCE NORTH 54°15'15" EAST 50 FEET, AS CREATED IN DEED RECORDED JUNE 10, 1968 AS INSTRUMENT NO. 53726, OFFICIAL RECORDS. 387
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EXHIBIT B
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EXHIBIT B

DIF SCHEDULE AS OF EFFECTIVE DATE
City of Banning Development Impact Fees1
Land Use Category Fire
Facilities
General
City
Facilities
Police Traffic Water Wastewater2
Nonresidential – Fee
per 1,000 Square Feet
- Industrial $236.00 $239.00 $170.00 $1,791.69
Per Table

8.5 in City
Council
Resolution
2019-112
$708.54
1 Represents the City of Banning Development Impact Fees for non-residential land uses effective November 9, 2019 per City Council Resolution No. 2019-112. 2 Wastewater Facilities Fee shown as per 1 EDU. Wastewater Facilities EDU Factors for every 1,000 square feet are 0.37 for Commercial, 0.13 for Office and 0.14 for Industrial.

City of Banning Development Impact Fees (cont’d.)
Land Use Category TUMF3 MSHCP3
Industrial $2.33 per square foot
$20,191 per acre
Class A/B Office $2.45 per square foot
3 TUMF and MSHCP subject to annual increases.
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EXHIBIT C
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EXHIBIT C

HATHAWAY IMPROVEMENTS
The following shall be completed to the satisfaction of the City Engineer:
 Along the west side of N Hathway Street between E Williams Street and E George Street, install City standard sidewalk behind curb and gutter, and install city standard curb ramps at intersections. Install new residential driveways as necessary to maintain access to existing driveway locations.  Within the existing right-of-way and pavement along the west side of N Hathway Street between E Williams Street and future Wilson Street, install striping for a new 6 ft. bike lane.
 Within the existing right-of-way and pavement along the east side of N Hathway Street between E Williams Street and existing Nicolet Street, install striping for a new 6 ft. bike lane.
 At the intersection of E Jacinto View Road and N Hathway Street, provide traffic measure to restrict Project traffic from access to E Jacinto View Rd  At the intersection of E Nicolet Street and N Hathway Street, provide traffic measure to restrict Project traffic from access to E Nicolet Street  At the intersection of E George Street and N Hathway Street, provide traffic measure to restrict Project traffic from access to E George Street 389
Ordinance 1611

ORDINANCE 1611

AN ORDINANCE OF THE CITY OF BANNING, CALIFORNIA, APPROVING A

DEVELOPMENT AGREEMENT BY AND BETWEEN THE CITY OF BANNING

AND JDNJ ENTERPRISES, LLC, A MISSOURI LIMITED LIABILITY

CORPORATION
WHEREAS, the City of Banning, California, (“City”) is a general law city and a municipal corporation of the State of California; and
WHEREAS, Article 2.5 of Chapter 4 of Division 1 of Title 7 of the California Government Code (“Development Agreement Statute”) and Chapter 17.60 of the Banning Municipal Code authorize City to enter into binding development agreements with persons having legal or equitable interests in real property for the development of such property; and WHEREAS, JDNJ Enterprises, LLC, a Missouri Limited Liability Corporation (“Owner”) is proposing to develop an approximately 1,320,284 square-foot tilt-up industrial building with onand off-sit related improvements on approximately 131.28-acres of real property located entirely within the City of Banning, comprised of three parcels having seven Assessor’s Parcel Number (Assessor’s Parcel Numbers (APNs): 532-030-008, 532-030-009, 532-080-008, 532-080-010, 532-090-026, 532-090-028, 532-090-030, 532-110-015.), and more specifically depicted and described in Exhibit A (hereinafter the “Property”); and WHEREAS, the Subject Property is, or will be made, subject to the following entitlements:

Resolution No. 2025-106 approving Tentative Parcel Map No. 38756 to reconsolidate all existing parcels on the Site into two parcels and Design Review No. 21-7017 for construction of one concrete tilt-up industrial building; and Resolution No. 2025-107 certifying an Environmental Impact Report (EIR), SCH Number 2022090102, Adopting Findings and a Statement of Overriding Considerations, and Adopting a Mitigation Monitoring and Reporting Program (collectively the "Entitlements"); and
WHEREAS, the Project will provide jobs and industry in the City; and WHEREAS, the Project will provide a community benefit to the residents of the City; and WHEREAS, the Developer is not requesting from the City, nor is the City providing, any form of financial assistance to locate, develop, construct and/or operate the Project in the City of Banning, and Developer agrees to comply with all conditions of approval; and WHEREAS, to strengthen the public planning process, encourage private participation in comprehensive planning and reduce the economic risk of development, the Legislature of the State of California adopted Sections 65864 et seq. of the California Government Code, (the "Development Agreement Statute") which authorizes cities to enter into property development agreements with any person(s) or entity(ies) having a legal or equitable interest in real property for the development of such real property in order to establish certain development rights in the real property; and
WHEREAS, the Development Agreement is intended to provide assurances to Developer that an approved Project may proceed subject to the specified policies, rules, regulations, and conditions of approval applicable to the Project at the time of approval, regardless of any changes to City policies, rules, and regulations after project approval; and 390
Ordinance 1611

WHEREAS, this Agreement will eliminate uncertainty in planning for and securing orderly development and occupancy of the Property, assure installation of necessary improvements, and ensure attainment of the maximum effective utilization of resources within the City at the least economic cost to its citizens; and
WHEREAS, the City Planning Commission held a public hearing on the Project on March 5, 2025 and passed a resolution recommending approval subject to certain specific recommendations; and
WHEREAS, the City prepared the Final Revised EIR (the "FEIR") and, pursuant to Public Resources Code section 21092.5, the City provided copies of the FEIR to all commenting agencies and persons requesting copies of the responses; and WHEREAS, the City Council of the City of Banning (the "City Council"), at its regularly scheduled public meeting on July 8, 2025, held a public hearing on the Project and voted 5-0 to introduce Ordinance 1611; and
WHEREAS, the Development Agreement attached as Exhibit “B” to Ordinance 1611 introduced at the hearing on July 8, 2025 was incomplete and required additional information, including (1) missing dates and references; (2) text to Section 17.C. to toll agreement and approvals in the event there is a third party challenge; (3) names for each party under signature lines; and (4) the current development impact fees applicable to the project in definitions and Exhibit B of the Agreement; and
WHEREAS, the City Council at its regularly scheduled public meeting on September 23, 2025, held a public hearing on the Project and considered re-introducing Ordinance 1611; and WHEREAS, based on the foregoing recitals, City has determined that this Agreement is appropriate under the Development Agreement Statute and Chapter 17.60 of the Banning Municipal Code and consistent with the policies and programs of the City of Banning General Plan, any applicable specific plan and the zoning ordinances; and WHEREAS, this Agreement is voluntarily entered into in consideration of the benefits to and the rights created in favor of each of the parties hereto and in reliance upon the various representations and warranties contained herein; and
WHEREAS, City, as "Lead Agency" under the California Environmental Quality Act ("CEQA") and the CEQA Guidelines, has determined that the "Project," as more fully described in this Agreement, has been fully analyzed per CEQA under the FEIR for the Project dated October 2024 and all other legal prerequisites to the adoption of this Ordinance have occurred.

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF BANNING DOES ORDAIN AS FOLLOWS:

SECTION 1. RECITALS
That the above Recitals are true and correct and are incorporated as though fully set forth herein.

SECTION 2. APPROVAL OF DEVELOPMENT AGREEMENT
That the City Council hereby approves the Development Agreement by and between the City of Banning and JDNJ ENTERPRISES, LLC, A MISSOURI LIMITED LIABILITY CORPORATION 391
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("Development Agreement"), a copy of which is attached hereto as Exhibit "B" and incorporated herein by this reference, subject to the terms and conditions stated therein.

SECTION 3. SEVERABILITY
The City Council declares that, should any provision, section, paragraph, sentence or word of this Ordinance be rendered or declared invalid by any final action in a court of competent jurisdiction or by reason of any preemptive legislation, the remaining provisions, sections, paragraphs, sentences or words of this Ordinance as hereby adopted shall remain in full force and effect.

SECTION 4. EFFECTIVE DATE OF ORDINANCE
That this Ordinance shall take effect thirty (30) days after its second reading by the City Council.

SECTION 5. EFFECTIVE DATE OF DEVELOPMENT AGREEMENT
The Development Agreement shall not be executed by the City until on or after the effective date of the Ordinance.

SECTION 6. RECORDATION OF DEVELOPMENT AGREEMENT
The City Clerk is hereby directed to record the fully executed Development Agreement with the Riverside County Recorder no later than ten (10) days after its execution.

SECTION 7. CERTIFICATION
The City Clerk is directed to certify the passage and adoption of this Ordinance; cause it to be entered into the City of Banning’s book of original ordinances; make a note of the passage and adoption in the records of this meeting; and, within fifteen (15) days after the passage and adoption of this Ordinance, cause it to be published or posted in accordance with California law.

PASSED, APPROVED AND ADOPTED this 23rd day of September, 2025.

Sheri Flynn, Mayor
City of Banning
ATTEST:

Sandra Calderon, Acting Administrative City Clerk
City of Banning
392
Ordinance 1611

APPROVED AS TO FORM:

John Pinkney, City Attorney
Slovak, Baron, Empey, Murphy & Pinkney, LLP
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CERTIFICATION:

I, Caroline Patton, Administrative City Clerk of the City of Banning, California, do hereby certify that Ordinance 1611 was duly introduced at a regular meeting of the City Council of the City of Banning, held on the 23rd day of September, 2025, and was duly adopted at a regular meeting of said City Council on the __ day of October, 2025, by the following vote, to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

Sandra Calderon, Acting Administrative City Clerk
City of Banning, California
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EXHIBIT A
Legal Description

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF BANNING, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

PARCEL 1:

THOSE CERTAIN PARCELS OF LAND LOCATED WITHIN THE MORONGO INDIAN

RESERVATION, LOCATED IN THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, BEING THOSE PORTIONS OF SECTION 1, 2 AND 12 OF TOWNSHIP 3 SOUTH, RANGE 1 EAST,

SAN BERNARDINO MERIDIAN, AS SHOWN ON THE OFFICIAL PLAT THEREOF, MORE PARTICULARLY DESCRIBED AS FOLLOWS:

COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 2;

THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 SOUTH 89°40'06" EAST 489.00 FEET TO A LINE PARALLEL WITH AND 489.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 2, SAID POINT BEING THE TRUE POINT OF BEGINNING;
THENCE ALONG SAID PARALLEL LINE NORTH 00°21'44" EAST 342.00 FEET TO A LINE PARALLEL WITH AND 342.00 FEET NORTHERLY OF SAID SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2;
THENCE ALONG SAID PARALLEL LINE SOUTH 89°40'06" EAST 2164.30 FEET TO THE EASTERLY LINE OF SAID SECTION 2;

THENCE CONTINUING ALONG THE EASTERLY PROLONGATION OF SAID PARALLEL LINE SOUTH 88°36'14" EAST 107.02 FEET TO A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 1;
THENCE ALONG SAID PARALLEL LINE SOUTH 00°17'18" WEST 270.81 FEET TO THE NORTHERLY LINE OF A STRIP OF LAND 16.50 FEET IN WIDTH, EXCEPTED FROM GRANT DEED REC. 10/7/2004 AS DOC. NO. 2004-0797131, OFFICIAL RECORDS OF THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA (DEPT. OF INT. FILING 582 173Y07); THENCE ALONG SAID NORTHERLY LINE SOUTH 89°47'09" WEST 107.00 FEET TO THE WESTERLY LINE OF SAID SECTION 1;
THENCE ALONG SAID WESTERLY LINE SOUTH 00°17'18" WEST 16.50 FEET TO THE SOUTHERLY LINE OF THE AFOREMENTIONED 16.50 FOOT STRIP;
THENCE ALONG SAID SOUTHERLY LINE NORTH 89°47'09" EAST 107.00 FEET TO A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 1;
THENCE ALONG SAID PARALLEL LINE SOUTH 00°17'18" WEST 52.58 FEET TO THE SOUTH LINE OF SAID SECTION 1, SAID POINT IS LOCATED ON A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 12; 395
Ordinance 1611

THENCE ALONG SAID PARALLEL LINE SOUTH 00°03'26" WEST 1044.17 FEET TO THE

NORTHERLY LINE OF THAT CERTAIN FINAL ORDER OF CONDEMNATION RECORDED AUGUST 19, 1963 AS INST. NO. 87113 AND THAT CERTAIN FINAL ORDER OF CONDEMNATION RECORDED SEPTEMBER 26, 1967 AS INST. NO. 84776, BOTH OF OFFICIAL RECORDS OF SAID COUNTY OF RIVERSIDE. SAID NORTHERLY RIGHT OF WAY LINE BEING DEPICTED CALTRANS RIGHT-OF-WAY MAP NO. 984524 FILED IN BOOK 204 PAGE 91 OF CALTRANS RIGHT-OF-WAY MAPS AND CALTRANS RIGHT-OF-WAY MAP NO. 452194 FILED IN BOOK 205 PAGE 263 OF CALTRANS RIGHT-OF-WAY MAPS, BOTH ON FILE IN THE MISC. RECORDS OF THE OFFICE OF THE COUNTY SURVEYOR OF SAID COUNTY OF RIVERSIDE;
THENCE ALONG SAID NORTHERLY RIGHT-OF-WAY SOUTH 71°02'58" WEST 113.17 FEET TO THE WESTERLY LINE OF SAID SECTION 2;
THENCE ALONG SAID WESTERLY LINE OF SECTION 12 NORTH 00°03'26" EAST 1081.36 FEET TO THE SOUTHEAST QUARTER OF THE AFOREMENTIONED SECTION 12;

THENCE ALONG THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SECTION 2 NORTH 88°36'14" WEST 2641.66 FEET TO THE SOUTH QUARTER CORNER OF SECTION 2;

THENCE ALONG THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2 NORTH 89°40'06" WEST 2161.30 FEET TO THE TRUE POINT OF BEGINNING;

RESERVING THEREFROM AN EASEMENT FOR INGRESS, EGRESS AND UTILITIES, MORE PARTICULARLY DESCRIBED AS FOLLOWS:

COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 2;

THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 SOUTH 89°40'06" EAST 2583.30 FEET TO A POINT 67.00 FEET WESTERLY OF THE SOUTH QUARTER CORNER OF SAID SECTION 2, SAID POINT IS THE TRUE POINT OF BEGINNING;
THENCE NORTH 00° 21'44" EAST 342.00 FEET TO A LINE PARALLEL WITH 342.00 FEET NORTHERLY OF SAID SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2; THENCE ALONG SAID PARALLEL LINE SOUTH 89°40'06" EAST 69.98 FEET TO A LINE PARALLEL WITH AND 342.00 FEET NORTHERLY OF THE SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 2;
THENCE ALONG SAID PARALLEL LINE SOUTH 88°36'14" EAST 30.02 FEET; THENCE SOUTH 00°21'44" WEST 342.06 FEET TO THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 2;
THENCE ALONG SAID SOUTHERLY LINE NORTH 88°36'14" WEST 33.02 FEET TO THE SOUTH QUARTER CORNER OF SAID SECTION 2;
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THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 NORTH 89°40'06" WEST 66.98 FEET TO THE TRUE POINT OF BEGINNING.

APN: 532-030-008, 532-030-009, 532-080-008, 532-080-010, 532-090-026, 532-090-028 AND 532-090-030
PARCEL 2:

THAT PORTION OF THE NORTHEAST 1/4 OF SECTION 11, TOWNSHIP 3 SOUTH, RANGE 1

EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO UNITED STATES

GOVERNMENT SURVEY, LYING NORTHERLY OF THAT CERTAIN PORTION OF SAID NORTHEAST 1/4 CONVEYED TO THE STATE OF CALIFORNIA BY DEED RECORDED OCTOBER 11, 1961, AS INSTRUMENT NO. 87046 IN BOOK 2997, PAGE 542, OFFICIAL RECORDS.

EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL

HYDROCARBONS, MINERALS, GEOTHERMAL RESOURCES, AND MINERAL ORES OF

EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, SOLID, LIQUID OR GAS AND

WHETHER OR NOT HEREAFTER KNOWN TO SCIENCE OR INDUSTRY, NOT KNOWN TO

EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR

UNDERLYING THE SURFACE OF SAID LAND AS SHOWN IN DEED RECORDED JANUARY 28, 1987 AS INSTRUMENT NO. 24458 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA.

APN: 532-110-015
PARCEL 3:

A NON-EXCLUSIVE EASEMENT FOR ROAD PURPOSES UPON, OVER AND ACROSS THAT PORTION OF THE EAST 1/2 OF THE NORTHWEST 1/4 OF SECTION 11, TOWNSHIP 3 SOUTH, RANGE 1 EAST, SAN BERNARDINO BASE AND MERIDIAN, INCLUDED WITHIN A STRIP OF LAND 20 FEET WIDE, THE NORTHERLY LINE OF WHICH IS DESCRIBED AS FOLLOWS:

BEGINNING AT A POINT IN THE EAST LINE OF THE SAID NORTHWEST 1/4, DISTANT ALONG SAID EAST LINE SOUTH 0°41'41" WEST 1359.31 FEET FROM A 3/4 INCH IRON PIPE AND BRASS CAP MARKED "U.S.G.L.O. 1917" SET FOR THE NORTH 1/4 CORNER OF SAID SECTION;
THENCE NORTH 89°25'57" WEST, 1319.31 FEET TO THE WEST LINE OF THE SAID EAST 1/2.

ALSO THAT PORTION OF THE WEST 20 FEET OF SAID EAST 1/2 LYING SOUTHERLY OF THE SOUTHERLY LINE OF THE ABOVE DESCRIBED 20 FOOT STRIP.

EXCEPT THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE:

BEGINNING AT A POINT IN THE WEST LINE OF SAID EAST 1/2, DISTANT ALONG SAID WEST LINE SOUTH 0°25'01" WEST 1041.97 FEET FROM THE POINT OF INTERSECTION 397
Ordinance 1611

THEREOF WITH THAT CERTAIN LINE HEREINABOVE DESCRIBED AS HAVING A BEARING OF NORTH 89°25'57" WEST;
THENCE NORTHEASTERLY ALONG 545 FOOT RADIUS CURVE CONCAVE NORTHWESTERLY FROM A TANGENT BEARING NORTH 56°01'51" EAST, THROUGH AN ANGLE OF 1°46'36", A DISTANCE OF 16.90 FEET;
THENCE NORTH 54°15'15" EAST 50 FEET, AS CREATED IN DEED RECORDED JUNE 10, 1968 AS INSTRUMENT NO. 53726, OFFICIAL RECORDS.
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Ordinance 1611

EXHIBIT B
Development Agreement
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RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:

CITY OF BANNING
99 E. RAMSEY STREET
BANNING, CA 92220

BANNING, CALIFORNIA
ATTN: CITY CLERK
SPACE ABOVE THIS LINE FOR RECORDER’S USE
EXEMPT FROM RECORDING FEE PER GOVERNMENT CODE SECTION 6103

DEVELOPMENT AGREEMENT

BETWEEN

THE CITY OF BANNING
AND

JDNJ ENTERPRISES, LLC

CONCERNING

BANNING COMMERCE CENTER
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THIS DEVELOPMENT AGREEMENT (the “Development Agreement”) is made and entered into this September 25, 2025, by and between the City of Banning, a California municipal corporation (the “City”), and JDNJ Enterprises, LLC, a Missouri limited liability corporation qualified to do business in the state of California (“Developer”). City and Developer may be referred to in this Development Agreement collectively as the “Parties” or each individually as a “Party.”

RECITALS

1. Article 2.5 of Chapter 4 of Division 1 of Title 7 of the California Government Code (“Development Agreement Statute”) and Chapter 17.60 of the Banning Municipal Code authorizes City to enter into binding development agreements with persons having legal or equitable interests in real property for the development of such property.

2. Developer is proposing to develop an approximately 1,320,000 square-foot tilt-up industrial building consisting of 39,600 square feet of office space and 1,280,400 square feet of warehousing, and trailer parking on approximately 131.33 acres of real property located entirely within the City of Banning, comprised of three parcels having seven Assessor’s Parcel Number (Assessor’s Parcel Numbers (APNs):
532-030-008, 532-030-009, 532-080-008, 532-080-010, 532-090-026, 532-090- 028, 532-090-030, 532-110-015.), and more specifically depicted and described in Exhibit A (hereinafter the “Site”).

3. City and Developer mutually desire to enter into this Development Agreement pursuant to the Development Agreement Statute in order to implement the Project.

4. On July 8, 2025, the City Council adopted Resolution No. 2025-106 approving Tentative Parcel Map No. 38576 to reconsolidate all existing parcels on the Site into two (2) parcels; and Design Review No. 21-7017 for construction of one concrete tilt-up industrial building as described in the preceding recitals.

Resolution No. 2025-106 and any attachments and exhibits thereto is hereby incorporated by this reference.

5. For purposes of this Development Agreement, the approvals granted by Resolution No. 2025-106 are referred to herein as the “Project Approvals.”

6. On August 26, 2025, the City Council adopted Ordinance No. 1611 approving this Development Agreement between the City and Developer and finding this Development Agreement to be consistent with the City’s General Plan and Zoning Code.

7. The terms and conditions of this Development Agreement have undergone extensive review by City staff and the City Council and have been found to be fair, just and reasonable. By electing to enter into this Development Agreement, the City agrees to bind future City Councils by the obligations specified herein and limit the future exercise of certain governmental and proprietary powers of the City; and 402
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further finds that the best interests of the citizens of the City and the public health, safety and welfare will be served by entering into this Development Agreement.

8. As set forth in the Project Approvals and this Development Agreement, development of the Site in accordance with this Development Agreement will further important policies and goals of the City, eliminate uncertainty in planning, provide for the orderly development of the Site, ensure progressive installation of necessary improvements, provide for public services appropriate to the development of the Project, and provide substantial community benefits.

9. Developer has incurred and will in the future incur substantial costs in order to assure development of the Site in accordance with this Development Agreement, and has incurred and will in the future incur substantial costs in excess of the generally applicable requirements in order to assure vesting of legal rights to develop the Site in accordance with this Development Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and other good and valuable consideration, the adequacy and receipt of which is hereby acknowledged, the Parties do hereby agree as follows:

AGREEMENT
SECTION 1. RECITALS
The Recitals are part of this Development Agreement and shall be enforceable as any other provision.

SECTION 2. DEFINITIONS
The following defined terms shall have the meanings set forth in this Section 2 unless a different meaning is clearly intended by the context in they are used.

A. “Development Agreement” means this Development Agreement.

B. “City” means the City of Banning.

C. “City Council” means the City Council of the City of Banning.

D. “City Manager” means the City Manager of the City of Banning.

E. “Developer” means JDN Enterprises, LLC, a Missouri limited liability corporation.

F. “Development Impact Fee Program” or “DIF Program” means City’s program of collection and use of development impact fees, including fees for Police Facilities, Fire Facilities, Parkland and Park Facilities, General City Facilities, Transportation Facilities, Wastewater Facilities, and Water Facilities (collectively “DIF”) as set forth in Banning City Council Resolutions 2019-112, as it may be amended or superseded, City’s Update of Traffic Fee Component of the Development Fee Program dated May 2019 and Development Impact Fee Update Study, dated 403
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August 7, 2019. The DIF Program also includes the regional MSHCP impact fee program imposed by the City in cooperation with Western Riverside County Regional Conservation Authority (“RCA”) and the TUMF impact fee program adopted by the City in cooperation with Western Regional Council of Governments (“WRCOG”).

G. “Effective Date” shall mean the date that Ordinance No. 1611 approving this Development Agreement becomes effective.

H. “Existing Development Regulations,” subject to the exclusions and reservations set forth in Section 7, means all ordinances, resolutions, codes, rules, regulations and official policies of the City in force as of the Effective Date and governing the development of the Project and use of the Site; including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, timing and phasing of development, the maximum height and size of buildings, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications.

I. “Municipal Code” means the Banning Municipal Code, as amended from time to time.

J. “Project” means the proposed development of the Site with 1,320,284 square-foot tilt-up industrial building consisting of 39,600 square feet of office space and 1,312,284 square feet of warehousing and trailer parking in a manner consistent with the Project Approvals and the terms and conditions of this Development Agreement.

K. “Project Approvals” means EIR 2022090102, SCH Number 2022090102, Tentative Parcel Map No. 38576 and Design Review No. 21-7017.

L. “Second Transportation Payment” shall have the meaning ascribed to it in Section 9(B) below.

M. “Site” means the real property that is the subject of the Project Approvals and as legally described in Exhibit A to this Development Agreement.

N. “Term” shall have the meaning ascribed to it in Section 6 below.

O. “Transfer” means any sale, lease, encumbrance, or other transfer of all or any portion of the Project or any interest therein.

P. “Transferee” means any person, partnership, limited liability company, joint venture, firm, or corporation who acquires an interest in the Site pursuant to a Transfer and assumes, or is deemed to assume, Developer’s obligations hereunder with respect to such interest.

Q. “Transportation Public Benefit Fee” shall have the meaning ascribed to it in Section 9(B) below.
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SECTION 3. DEVELOPER’S REAL PROPERTY INTEREST
Developer warrants and represents that, as of the Effective Date, it has or will have legal title to or an equitable interest in the Site; that it has full legal right to enter into this Development Agreement; and that the persons executing this Development Agreement on behalf of each Developer have been duly authorized to do so.

SECTION 4. RELATIONSHIP OF THE PARTIES
It is hereby specifically understood and acknowledged that the Project is a private development and that neither the City nor Developer will be deemed to be the agent of the other for any purposes whatsoever.

SECTION 5. BINDING EFFECT OF DEVELOPMENT AGREEMENT
A. Covenants, Reservations, and Restrictions. Developer hereby subjects the Project and the Property to the covenants, reservations, and restrictions as set forth in this Development Agreement. The City and Developer hereby declare their specific intent that the covenants, reservations and restrictions as set forth herein shall be deemed covenants running with the land and shall pass to and be binding upon each of Developer’s successors and assigns in title or interest to the Site. The Parties hereby further declare their understanding and intent that the benefit of such covenants, reservations, and restrictions touch and concern the land by enhancing and increasing the enjoyment and use of the Site by Developer and the future occupants of the Site, the intended beneficiaries of such covenants, reservations, and restrictions, and by furthering the public purposes for which this Development Agreement is adopted. Each and every contract, deed, or other instrument hereinafter executed, covering, or conveying the Site or any portion thereof shall conclusively be held to have been executed, delivered, and accepted subject to the covenants, reservations, and restrictions expressed in this Development Agreement, regardless of whether such covenants, reservations, and restrictions are set forth in such contract, deed, or other instrument.

B. Recordation. The City Clerk shall record this Development Agreement in the Official Records of the County Recorder of the County of Riverside within ten (10) days following the Effective Date. Upon the expiration or termination of this Development Agreement and the request of Developer, the City will execute and deliver, in recordable form, an instrument confirming that this Development Agreement is of no further force or effect.

SECTION 6. TERM
The Term of this Development Agreement shall commence on the Effective Date and shall expire fifteen (15) years thereafter (the “Initial Term”) unless terminated sooner as provided in this Development Agreement. Unless Developer is in default under this Agreement, the Term shall automatically be extended for an additional five (5) years if prior to the expiration of the Initial Term, the Developer has provided City with the initial Transportation Public Benefit Fee in the amount of Two Million Five Hundred Thousand Dollars ($2,500,000) as specified in Section 9.B. Unless otherwise specified in this 405
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Development Agreement, the respective rights and obligations of the Parties hereto shall remain in full force and effect throughout the Term. Notwithstanding any provision to the contrary herein, in the event that, for any reason whatsoever, Developer fails to acquire fee simple title to the Property ("Fee Title") within 180 days following the Effective Date ("Fee Title Deadline"), Developer may elect, in its sole and absolute discretion, with the written approval of the fee title owner, and upon written notice to the City within sixty (60) days following the Fee Title Deadline, to terminate this Agreement and the Project Approvals. Effective upon such termination by Developer and fee title owner, this Agreement and the Project Approvals shall be of no further force or effect. After the Fee Title Deadline, if Developer has failed to acquire Fee Title and the fee title owner does not issue written approval of termination of this Agreement within five (5) days after the Fee Title Deadline, Developer shall no longer be subject to any of the obligations created in this Agreement or in the Project Approvals.

SECTION 7. VESTING OF DEVELOPMENT RIGHTS
A. General Statement. As a material inducement to Developer and its lenders to continue with diligent efforts to promote the development of the Property, Developer shall have the vested right to develop the Project on the Site in accordance with the terms and conditions of the Project Approvals, this Development Agreement, and the Existing Development Regulations, and City shall have the right to control development of the Site in accordance with the provisions of the Project Approvals, this Development Agreement, and the Existing Development Regulations.

B. Existing Development Regulations. In accordance with the terms of Gov. Code, § 65866, City and Developer agree the development of the Project on the Site shall be subject to all ordinances, resolutions, codes, rules, regulations and official policies of the City in force as of the Effective Date and governing the development and of the Site, including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, timing and phasing of development, the maximum height and size of buildings, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications applicable to the development of the Site (collectively “Existing Development Regulations”) except as otherwise provided in this Development Agreement.

C. Exclusions and Reservations.

1. “Existing Development Regulations” excludes, and nothing in this Development Agreement shall preclude the application of, any municipal ordinance, resolution, code, rule, regulation or official policy, laws, and regulations that do not conflict with Developer’s vested rights to develop and use the Property in accordance with this Development Agreement.

Developer shall comply with such nonconflicting laws and regulations as may from time to time be enacted or amended hereafter.
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2. Without limitation to the foregoing exclusions or any nonconflicting law, City hereby expressly reserves its right with regarding to the Project and the Site to apply and enforce any municipal ordinance, resolution, code, rule, regulation or official policy, laws, or regulations regarding: (i) the conduct of businesses, professions, and occupations; (ii) taxes, fees, charges, and assessments; (iii) the control and abatement of nuisances; (iv) the granting of encroachment permits and the conveyance of similar rights and interests that provide for the use of or the entry upon public property; (v) the exercise of the power of eminent domain; (vi) any and all new health and safety regulations (e.g., fire, building, and seismic, plumbing, and electric codes) made applicable in the City, inclusive of any similar such codes based upon uniform codes and incorporated by reference into the Banning Municipal Code; and (vii) procedural rules of general city-wide application, provided that City agrees to nevertheless process any Minor Modifications to Tentative Parcel Map No. 38576 or Design Review No. 21-7017 pursuant to the Chapter 17.84 of the Banning Municipal Code as that Chapter reads as of the Effective Date regardless of any later Municipal Code amendment.

Such Minor Modifications may include modifications which do not: (a) alter the permitted uses of the Site; (b) increase the maximum height and size of permitted buildings or structures in excess of the originally approved Project; or constitute a project requiring a subsequent or supplemental environmental impact report pursuant to Public Resources Code § 21166.

D. Superior Law. Nothing in this Development Agreement shall preclude the application to the Project and the Site of those changes in City ordinances, regulations, plans, or specifications that are: (i) specifically mandated and required by changes in state or federal laws or regulations as provided in Government Code § 65869.5 or any successor provision or provisions; (ii) required to ensure public safety and are made applicable throughout the City; or (iii) required to ensure access under the Americans with Disabilities Act. In the event such changes prevent or preclude compliance with one or more of the provisions of this Development Agreement, such provisions of this Development Agreement shall be modified or suspended or performance thereof delayed, to the extent necessary to comply with such changes in the law.

SECTION 8. DEVELOPMENT TIMING; PERMIT PROCESSING
A. Developer’s Discretion. Because the California Supreme Court held in Pardee Construction Co. v. City of Camarillo, 37 Cal.3d 465 (1984), that failure to provide for the timing of development resulted in a later adopted initiative restricting the timing of development, it is the Parties’ intent to avoid that deficiency by acknowledging and providing that Developer shall have the right (without obligation), subject to the provisions of this Development Agreement, to complete the Project in such order and at such rate and at such times as Developer deems appropriate within the exercise of its subjective business judgment. 407
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B. Permit Processing. The City and its officers, agencies and departments shall not unreasonably delay the processing of any application for any permit or approval necessary to commence or complete the Project.

C. Provision of Real Property Interests by City. In any instance where Developer is required to construct any public improvement on land not owned by Developer, Developer shall at its sole cost and expense provide or cause to be provided, the real property interests necessary for the construction of such public improvements.

In the event Developer is unable, after exercising reasonable efforts over a period of at least 180 days to acquire the real property interests necessary for the construction of such public improvements (“Offsite Interests”), and if so requested by Developer and upon Developer’s provision of adequate security for costs City may reasonably incur as determined by City in its discretion, City may negotiate to attempt to purchase the Offsite Interests in order to allow Developer to construct the public improvements as required by the Project Approvals or this Development Agreement. If City is unable to acquire the Offsite Interests through a voluntary transaction, City shall consider acquiring the Offsite Interests through using its power of eminent domain to acquire such required real property interests. If City does elect in its discretion to exercise its power of Eminent domain, Developer shall pay all reasonable costs associated with such acquisition or condemnation proceedings as determined by City in its discretion and shall enter into a land acquisition agreement (“LAA”) with City in a form approved by the City Attorney.

The LAA shall provide among other things, that the Developer shall provide a deposit in an amount determined by the City to cover the City’s staff, legal and other expenses associated with the condemnation proceedings. This Section is not intended by the Parties to impose upon the Developer an enforceable duty to acquire land or construct any public improvements on land not owned by Developer, except to the extent that the Developer elects to proceed with the development of the Project, and then only in accordance with valid conditions imposed by City upon the development of the Project under the Subdivision Map Act or other legal authority. If after using good faith efforts to acquire the Offsite Interests, Developer is unable to acquire the Offsite Interests, and City, in its reasonable discretion, refuses to use its power of eminent domain to acquire the Offsite Interests, City shall waive the requirement for Developer to acquire the Offsite Interests, or if development of the Project cannot proceed without acquisition of the Offsite Interests, the Parties shall meet and confer in good faith to attempt to devise alternatives to allow the Project to proceed without acquisition of the Offsite Interests.

D. Subdivision Map Extension and Other Development Approvals. As permitted by Government Code § 66452.6, each subdivision or parcel map, heretofore or hereafter approved in connection with development of the Site or the Project shall be extended and shall remain in effect for the term provided by this Agreement. If Developer, in its sole and absolute discretion, chooses to process vesting tentative maps, City shall process such vesting maps subject to and in accordance with the Existing Land Use Regulations, the Subdivision Map Act. Subject to and in accordance with the Existing Land Use Regulations, and the Subdivision Map Act any tentative map, either vesting or non-vesting, may be processed in phases. In 408
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addition, Design Review No. 21-7017 and all subsequently adopted discretionary project approvals shall remain in effect for the term provided by this Development Agreement.

E. Development Impact Fees. Development Impact Fees (“DIF”) currently imposed are identified in Resolution 2019-112 adopted by the City Council on September 10, 2019. “DIF” also includes TUMF and MSHCP. A schedule showing the DIF applicable to industrial uses only in place as of the Effective Date (excluding MSHCP and TUMF) is attached as Exhibit “B”. If other uses are sought by Developer the DIF for such use shall apply. DIF and sewer and water connection and capacity fees shall be those in effect at the time of the issuance of a building permit and due and payable by Developer prior to the issuance of the building permit for the building in question. For the sake of clarity, as a condition to building permit issuance for each industrial building, Developer shall pay the development impact fees listed on Exhibit “B” as well TUMF and MSHCP for such building in the amount in effect at the time the building permit for such building is issued, as well as any new or increased DIF authorized by this Agreement. For the sake of clarity, Developer shall be subject to all increases and amendments to DIF at all times.

Notwithstanding the forgoing, the City may apply subsequently adopted new categories of DIF to the Project if the same are applied uniformly to development either throughout the City or within a defined area of benefit that includes the Property if the subsequently adopted DIF is not applied on an ad hoc basis solely to the Project and the subsequently adopted fee does not physically prevent development of the Property for the uses and to the density and intensity of development set forth in this Agreement. Notwithstanding the foregoing, if Developer is not in default under this Agreement and has made the initial Transportation Public Benefit Fee of Two Million Five Hundred Thousand Dollars ($2,500,000) as specified below, prior to first anniversary of the Effective Date, the City agrees not impose any new category of DIF on the Project for a period of Five Years after the Effective Date.

SECTION 9. PUBLIC BENEFITS
A. Intent. This Section sets forth the terms and conditions under which Developer agrees to provide public benefits in consideration of the of the benefits conferred on Developer and the Site by this Development Agreement.

B. Transportation Public Benefit Fee. Developer shall pay City a Transportation Public Benefit Fee in the amount of Nine Million Dollars ($9,000,000) (“Transportation Public Benefit Fee”).Two Million Five Hundred Thousand Dollars ($2,500,000) of the Transportation Public Benefit Fee will be paid no later than one (1) year from the Effective Date and the remaining amount of Six Million Five Hundred Thousand Dollars ($6,500,000) (“Second Transportation Payment”) prior to the issuance of the Project’s first building permit. If the Second Transportation Payment is not paid prior to the second anniversary of the Effective Date, the amount of the Second Transportation Payment will increase annually equal to the annual percentage change in the Consumer Price Index published by the U.S.

Bureau of Labor Statistics for “All Urban Consumers” in the Riverside-San 409
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Bernardino-Ontario Area, measured as of the month of April in the previous Fiscal Year, but not less than one percent (1%) and not greater than five percent (5%) .

The City shall solely use the Ramsey Interchange Fee for the design and construction of the Ramsey-Interstate 10 interchange and or the Hargrave Street interchange. The City acknowledges and agrees that the City shall not impose any other fee or exaction upon Developer for the Ramsey-Interstate 10 interchange.

C. Electrical Facilities Fee. Developer shall pay City an Electrical Facilities Fee equal to Three Hundred and Fifty-Seven Thousand Dollars ($357,000) per megavoltamperes (MVA) of requested electrical load due and payable pro rata prior to issuance of any building permit (“Electric Facilities Fee”). City shall use the proceeds of the Electrical Facilities Fee solely for the design or construction of new or expanded electrical facilities, which can include reimbursement to the City for part of the cost of an existing electrical facility substation which the City has funded.

D. Electrical Substation Land Dedication. Developer shall reserve and offer to dedicate to City lettered-lot “C” on the proposed Tentative Parcel Map No. 38576 for the Banning Electrical Utility to have the option to construct a new electrical substation (“Substation Property”). Such offer of dedication shall occur at the time final Parcel Map No. 38576 is recorded. If the City accepts the offer of dedication and undertakes construction of the electrical substation on the Substation Property, construction of the electrical substation shall be undertaken by the City at no cost to Developer. If the City accepts the offer of dedication for the Substation Property, City or its successors shall not use the Substation Property for any purpose other than a substation and related uses. If the City accepts the offer of dedication for the Substation Property, within thirty (30) days of City’s acceptance of the dedication, City shall pay the amount of the fair market value (“FMV”) of the Substation Property to the Developer, with the amount of the payment capped at the amount of the Electric Facilities Fee Acquisition of the Substation Property shall be at the sole discretion of the City and the City may in its sole discretion elect not to acquire the Substation Property.

E. Prior to the issuance of the first certificate of occupancy within the Project, the Developer shall be required to take all actions required to improve Hathaway Street, as depicted in Exhibit “C”.

F. The Developer shall use reasonable efforts to hire residents of the City of Banning.

Developer will hold at least one local job fair with the City for the purpose of recruiting workers from the City.

G. Sanitary Lift Station Land Construction and Dedication. Developer shall construct a sanitary lift station (“Lift Station”) on lettered lot “D” on the proposed Tentative Parcel Map No. 38576 (“Lift Station Property”) subject to plans and specifications approved by the Public Works Director and as contemplated by the Sewer Master Plan dated March 2018. City shall issue DIF credits against the wastewater DIF which includes the Lift Station and Lift Station Property in the amounts of (i) the cost of designing and constructing the Lift Station, and (ii) the FMV of the Lift 410
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Station Property (collectively, “Lift Station Costs”) in an amount not to exceed the Developer’s wastewater DIF obligation. Developer shall complete construction of the Lift Station prior to the issuance of the first certificate of occupancy for the Project. Developer is aware that the sewer force main near the Project running to Nicolet was installed by a previous developer on its property, and Developer must obtain the consent of the property owner to use this sewer force main for the Project and to undertake any additional improvements to the sewer force main at its sole cost and expense.

H. FMV Process. In order to determine the FMV of the Substation Property and the Lift Station Property, City shall commission an appraisal for each property, which shall be addressed to City and Developer, at Developer’s sole expense, prepared by a licensed appraiser holding a MAI designation from the Appraisal Institute (“Developer’s Appraiser”) with at least 15 years’ experience in appraising similar properties in the same geographical region. The FMV shall be based upon the the assumption the Property has in place all needed discretionary approvals to develop a project similar in nature to the Project. The appraiser shall use a date of valuation which is the current date of the appraisal. Developer’s Appraiser shall deliver a written report as to their opinion of FMV for each property within sixty (60) days after such appraiser has been retained by Developer. Upon receipt of Developer’s appraisal, the City shall have thirty (30) days to review the appraisal and agree or dispute the determination of FMV. In the event that the City disputes the FMV determined by Developer’s appraisal, the City shall be entitled to commission a second appraisal, at the City’s own expense, prepared by a licensed appraiser having the qualifications provided above (“City’s Appraiser”). The City’s Appraiser shall deliver a written report as to their opinion of FMV for the property within sixty (60) days after such appraiser has been retained by the City. If the higher appraisal is equal to or less than 120% of the lower appraisal, the two appraisals will be added together and their total divided by two; the resulting quotient will be the FMV of the property in question. If the higher appraisal is greater than 120% of the lower appraisal, the Parties shall have sixty (60) days after Developer’s receipt of the City’s appraisal to reach a negotiated resolution. If the Parties are unable to reach a negotiation resolution, the Parties shall reasonably cooperate to select a third licensed appraiser having the qualifications provided above(“Review Appraiser”) to make a final determination of FMV. If the Parties are unable to agree on the selection of the Review Appraiser, the Parties shall jointly petition the Riverside County Superior Court to select a Review Appraiser. The Parties will equally share the fees and expenses associated with the Review Appraiser, including but not limited to, the Parties’ joint petition to select a Review Appraiser and the Review Appraiser’s fees. The Review Appraiser shall review the two appraisals and then make a determination of FMV, which shall be no less than the value of the lower appraisal and no greater than the value of the higher appraisal. The Review Appraiser’s determination of FMV shall be binding on all Parties.
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I. Community Facilities Districts.

1. Service CFD. Developer agrees, pursuant to the Mello Roos Act, to petition the City or, alternatively, California Statewide Communities Development Authority (“CSCDA”) to form a community facilities district, the boundaries of which shall be coextensive with those of the Site (the “Service CFD”) for the purpose of financing City services and ongoing maintenance of public improvements provided by the City to the parcels within the boundaries of the Service CFD the cost of which shall be solely borne by the Developer, provided such services qualify as authorized services under the Mello Roos Act (collectively, “Authorized Services”). The Service CFD shall be a condition to the City’s issuance of the first certificate of occupancy for the Project.

2. If City sponsors the formation of the Service CFD, City shall initiate the process promptly following submission of Developer’s petition and compliance with Section 53318(d) of the Mello-Roos Act and shall use good faith, diligent efforts to form the Service CFD, including the scheduling of necessary public hearings at the cost of Developer. If requested, Developer will execute a reimbursement agreement providing for the advance deposit of monies to reimburse City for the cost of its implementing the CFD.

Developer agrees to cooperate in the formation and agrees that it will not contest and will exercise all of its voting power in favor of the formation of the Service CFD. Should Developer request CSCDA to sponsor the formation of the Service CFD, City shall cooperate in process and agrees to use good faith efforts to take all necessary and appropriate actions to assist Developer and CSCDA in the formation of the Service CFD in accordance with Section 9.H.1, including the issuance of necessary consents in the formation process.

3. Developer and City shall reasonably cooperate in developing the rate and method of apportionment of special taxes for the Service CFD (“Service RMA”), which the Parties agree shall provide, in part: (a) the maximum Service Special Tax rate in the first year that there is a levy of the Service Special Tax shall be at a rate of $0.10 per building square foot, which amount shall be subject to an “Annual Escalation Factor” equal to the annual percentage change in the Consumer Price Index published by the U.S. Bureau of Labor Statistics for “All Urban Consumers” in the RiversideSan Bernardino-Ontario Area, measured as of the month of April in the previous Fiscal Year, but not less than three percent (3%) and not greater than five percent (5%); (b) the levying of the Service Special Tax shall commence in the first fiscal year following the issuance of a certificate of occupancy by May 1 of the preceding Fiscal Year, (c) the adoption of an annual budgeting process to establish the annual actual Service Special Tax rate, and (d) the Service Special Tax cannot be prepaid.

4. Facilities CFD At the discretion of the Developer, Developer may, pursuant to the Mello Roos Act, petition the City or, alternatively, pursue other 412
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financing alternatives, including requesting CSCDA to form a community facilities district, the boundaries of which shall be coextensive with those of the Site (“Facilities CFD,” collectively with Service CFD, the “CFDs”) for the purpose of financing (i) public infrastructure required under the Development Agreement, including without exception, public streets, highways, and bridges, and other related improvements such as grading, paving, curbs and gutters, sidewalks, street signalization and signage, street lights and parkway landscaping related thereto, water facilities, storm drain facilities, sewer facilities, public parks, landscaping, electrical facilities, (collectively, “Facilities”), and (ii) Development Impact Fees, including, without exception, the Public Benefit Fees described in Section B and C above (“Fees,” collectively with Facilities, “Authorized Facilities and Fees”).

If City agrees to sponsor the formation of the Facilities CFD, City shall initiate the process promptly following submission of Developer’s petition and compliance with Section 53318(d) of the Mello-Roos Act, and shall use good faith, diligent efforts to form the Facilities CFD and timely issue bonds (“CFD Bonds”), including the scheduling of necessary public hearings related to formation and issuance of CFD Bonds. Any costs incurrent in establishing the Facilities CFD and issuing the CFD Bonds shall be paid from the CFD Bond proceeds, or failing that by the Developer. Developer agrees to cooperate in the formation and agrees that it will not contest and will exercise all of its voting power in favor of the formation of the Facilities CFD and issuance of CFD Bonds. Should Developer request CSCDA to sponsor the formation of the Facilities CFD and be the issuer of the CFD Bonds, City shall cooperate in process and agrees to use good faith efforts to take cooperate with Developer and CSCDA in the formation of the Facilities CFD and the issuance of the CFD Bonds, including the issuance of necessary consents in the formation and bond issuance processes.

Developer and City shall reasonably cooperate in developing the rate and method of apportionment of special taxes for the Facilities CFD (“Facilities RMA”).

5. In the event Developer conveys or grants an easement to any portion of the Site to City or any other government agency and the property so conveyed is subject to payment of special taxes under the Facilities CFD formed pursuant to this Development Agreement and CFD Bonds have been issued and are outstanding, Developer shall prepay the special taxes pursuant to the terms of the Facilities RMA with respect to the portion of the Site subject to an easement or being conveyed prior to completion of any such conveyance or easement. Upon completion of the conveyance or grant of easement, Developer’s obligation to pay special taxes pursuant to the Facilities RMA and the Services RMA for the conveyed property shall terminate. Alternatively, the RMA may exclude the forgoing conveyance or grant of easement from the imposition of the special taxes to accomplish the goals of this paragraph.

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as committing or requiring the City Council to authorize and approve the formation of the CFDs and/or the issuance of the CFD Bonds. Further, City and Developer agree that the practical ability to issue CFD bonds is subject to marketability and therefore, Developer and City will first consult with a mutually agreed upon public finance consultant, at Developer’s cost prior to forming a Facilities CFD.

7. Except as expressly set forth or reserved in this Development Agreement, City shall not, without the prior written consent of Developer, initiate the formation of any new financing district or assessment district involving the levy of special taxes or assessments for facilities or services applicable to the Project or any portion thereof during the term of this Agreement or prior to the substantial completion of the Project.

SECTION 10. COMPLIANCE REVIEW
Within ten (10) days of each anniversary of the Effective Date, Developer shall file a report with City containing sufficient evidence to demonstrate Developer’s good faith compliance with this Development Agreement, and City will review Developer’s report in good faith.

Pursuant to Gov. Code § 65865.1, if City finds and determines, as a result of its review, that there is substantial evidence that Developer has not complied in good faith with terms or conditions of this Development Agreement, City may terminate or modify the agreement. City does not waive any claim of defect in performance by Developer if after any annual review, City does not enforce this Development Agreement.

SECTION 11. TRANSFERS AND ASSIGNMENTS
A. Transfers. Developer shall have the right to sell, transfer or assign the Site in whole or in part (provided that no such partial transfer shall violate the Subdivision Map Act, Government Code § 66410 et seq.) to any person, partnership, limited liability company, joint venture, firm or corporation at any time during the Term of this Development Agreement without the prior consent of City. City acknowledges and agrees it is likely in the future that Developer may transfer its interest in the Site to an affiliated entity. Developer and Transferee shall execute and record an Assignment and Assumption Agreement whereby the assignee agrees to perform all of the obligations of the Developer under this Development Agreement, a copy of which shall be delivered to the City contemporaneously upon the closing of such sale, transfer or assignment. Upon recordation of the Assignment and Assumption Agreement, Developer shall be released from its obligations with respect to such portion of, or interest in, the Project that was the subject of such Transfer.

B. Conditions Applicable to Transfers. Notwithstanding whether a Transferee has executed an Assignment and Assumption Agreement, a Transferee shall be deemed upon transfer or assignment to have assumed all Developer’s obligations and to have been assigned all of Developer’s rights under this Development Agreement, and will be deemed the Developer hereunder. This Development Agreement may only be transferred to a person or entity who acquires fee title to the Site or any portion of the Site. Notwithstanding anything herein to the contrary, 414
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in no event shall any Lender (as defined in Section 12 below) have any obligation under this Development Agreement unless and until such Lender purchases at a foreclosure sale, or accepts a deed in lieu of foreclosure, the portion of the Site that was subject to a mortgage.

C. Release of Transferring Developer. Notwithstanding any transfer, a transferring Developer shall continue to be obligated under this Development Agreement until the full satisfaction by such transferring Developer of the following conditions and upon such satisfaction shall be released from the obligations under this Development Agreement: (i) Developer no longer has a legal or equitable interest in all or any part of the Site; (ii) Developer is not then in default under this Development Agreement; and (iii) Developer has provided City with the notice and executed agreement required under Section 11(A) above. If requested by transferring Developer, the City shall promptly memorialize such release in writing upon satisfaction of the foregoing conditions. A default under this Development Agreement by Developer shall not be considered or acted upon by the City as a default by the transferee and shall not affect the transferee’s rights or obligations hereunder,. Likewise, a default by a transferee relating to the transferred portion(s) of the Site shall not be considered or acted upon by the City as a default by Developer and shall not affect Developer’s rights and obligations hereunder.

Notwithstanding the forgoing, if a default of this Development Agreement is of a continuing nature that affects continued development of the Project including, but not limited to a failure to complete public improvements in accordance with the Project Approvals as needed to provide service to the Project or the payment of any tax, fee or assessment such default shall be the continuing responsibility of the transferee, if the transferee has accepted the obligation to complete public improvements.

SECTION 12. LENDERS
A. Rights of Lender. Should Developer place or cause to be placed any encumbrance or lien on the Project, or any part thereof, the beneficiary (“Lender”) of such encumbrance or lien shall have the right at any time during the Term of this Development Agreement and the existence of such encumbrance or lien to: (i) do any act or thing required of Developer under this Development Agreement, or cure any default of Developer under this Development Agreement within the time limits set forth in this Development Agreement, and any such act or thing done or performed by Lender or cure shall be as effective as if done by Developer; (ii) realize on the security afforded by the encumbrance or lien by exercising foreclosure proceedings or power of sale or other remedy afforded in law or in equity or by the security document evidencing the encumbrance or lien (hereinafter referred to as “a trust deed”); (iii) transfer, convey or assign the title of Developer to the Site to any purchaser at any foreclosure sale, whether the foreclosure sale be conducted pursuant to court order or pursuant to a power of sale contained in a trust deed; and (iv) acquire and succeed to the interest of Developer by virtue of any foreclosure sale, whether the foreclosure sale is conducted pursuant to a court order or pursuant to a power of sale contained in a trust deed. Should any Lender request an amendment of this Development Agreement in respect of the rights and 415
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remedies granted to a Lender, the City shall consider such an amendment in good faith and in accordance with state and local law so long as the proposed amendment does not materially and adversely affect the rights, powers, and remedies of the City in respect of a default by Developer hereunder.

B. Notice to Lender. City shall give written notice of any default or breach under this Development Agreement by Developer to Lender (if known by the City) simultaneously with such notice of default the City gives to Developer and afford Lender the opportunity after receipt of service of the notice to: (i) cure the breach or default within thirty (30) days after service of such notice, where the default can be cured by the payment of money; (ii) cure the breach or default within thirty (30) days after service of such notice where the breach or default can be cured by something other than the payment of money and can be cured within that time; or (iii) cure the breach or default in such reasonable time as may be required where something other than payment of money is required to cure the breach or default and cannot be performed within thirty (30) days after such notice, provided that acts to cure the breach or default are commenced within a thirty (30) day period after service of such notice of default on Lender by the City and are thereafter diligently completed by Lender.

C. Action by Lender. Notwithstanding any other provision of this Development Agreement, a Lender may forestall any action by the City for a breach or default under the terms of this Development Agreement by Developer by commencing proceedings to foreclose its encumbrance or lien on the Site. The proceedings so commenced may be for foreclosure of the encumbrance by order of court or for foreclosure of the encumbrance under a power of sale contained in the instrument creating the encumbrance or lien. The proceedings shall not, however, forestall any such action by the City for the default or breach by Developer unless: (i) they are commenced within thirty (30) days after service on Developer (and on Lender if Lender’s address is provided by notice to the City pursuant this Development Agreement) of the notice described hereinabove; (ii) they are, after having been commenced, diligently pursued in the manner required by law to completion within one year; and (iii) lender keeps and performs all of the terms, covenants, and conditions of this Development Agreement requiring the payment or expenditure of money by Developer until the foreclosure proceedings are complete or are discharged by redemption, satisfaction, or payment.

SECTION 13. NOTICES
Any notice or instrument permitted or required under this Development Agreement shall be deemed made when personally delivered or when mailed 72 hours after deposit in the United States Mail, certified mail postage prepaid and addressed to the party at the following addresses:

If to City: City of Banning
99 E. Ramsey Street
Banning, CA 92220
Attn: City Manager
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If to Developer JDNJ ENTERPRISES, LLC
120 South Central Avenue, Suite 500
St. Louis. MO 63105
Attn: John C. Condas
Allen Matkins Leck Gamble Mallory & Natsis LLP
2010 Main Street, Suite 800
Irvine, CA 92614
Actual notice shall be deemed adequate notice on the date actual notice occurred, regardless of the method of service.

SECTION 14. EVENT OF DEFAULT
Developer is in default under this Development Agreement upon the occurrence of one or more of the following events or conditions:

A. A material warranty, representation, or statement made or furnished by Developer to City set forth herein or in any document incorporated by reference herein is false or proved to have been false in any material respect when it was made.

B. City finds and determines upon the basis of substantial evidence following an annual review pursuant to this Development Agreement, that Developer has not complied in good faith with any material term and/or condition of this Development Agreement, subject to notice and opportunity to cure as provided by this Development Agreement.

C. Developer breaches any of the terms or conditions of this Development Agreement, after notice and opportunity to cure as provided in this Development Agreement.

SECTION 15. ENFORCEMENT
A. Notice; Cure. In the event of a default under the provisions of this Development Agreement by Developer or City, the non-breaching party shall give written notice to the defaulting party (or its successor) by registered or certified mail addressed at the address stated in this Development Agreement, and if such violation is not corrected to the reasonable satisfaction of the non-breaching party within thirty (30) days after such notice is served on the defaulting party, or if such breach or default cannot be cured within such thirty (30) days (excluding monetary defaults) and provided that acts to cure the breach or default must be commenced within such thirty (30) days and must thereafter be diligently pursued to completion by the defaulting party, then the non-breaching party may, without further notice, declare a default under this Development Agreement and, upon any such declaration of default, if the City is the defaulting party, Developer may bring any action necessary to specifically enforce the obligations of City. If Developer is the defaulting party, then City may give notice to Developer of its intent to terminate or modify this Development Agreement, in which event the matter shall be scheduled for consideration and review by the City Council.
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B. Remedies. The Parties acknowledge that money damages and remedies at law generally are inadequate and specific performance and other non-monetary relief are particularly appropriate remedies for the enforcement of this Development Agreement and should be available to the Parties for the following reasons: due to the size, nature, and scope of the Project, it may not be practical or possible to restore the Property to its natural condition once implementation of this Development Agreement has begun. After such implementation, Developer may be foreclosed from other choices it may have had to utilize the Site or portions thereof. Developer has invested significant time and resources and performed extensive planning and processing of the Project in agreeing to the terms of this Development Agreement and will be investing even more significant time and resources in implementing the Project in reliance upon the terms of this Development Agreement, and it is not possible to determine the sum of money which would adequately compensate Developer for such efforts. Accordingly, it is expressly recognized that injunctive relief and specific enforcement of this Development Agreement are proper and desirable remedies, and it is agreed that in any claim by Developer against City for an alleged breach of this Development Agreement may avail itself to injunctive relief or an appropriate action for specific enforcement of this Development Agreement. It is agreed that specific performance is not available to City against Developer, although City can seek the remedy of injunctive relief, declaratory relief or any other appropriate remedy against Developer.

C. Nonperformance by Developer. Nonperformance by Developer shall not be excused because performance by Developer of the obligations herein contained would be unprofitable, difficult, or expensive, or because of a failure of any third party or entity, other than City.

SECTION 16. PARTIES NOT LIABLE FOR DAMAGES
It is acknowledged by the Parties that the City and Developer would not have entered into this Development Agreement if either could be held liable in damages under or with respect to this Development Agreement or the application thereof. Consequently, and except for the payment of attorneys’ fees in accordance with this Development Agreement, the City shall not be liable in damages to Developer, or to any assignee, transferee, or any other person, and Developer shall not be liable in damages to City.

Developer and City jointly covenant on behalf of itself and its successors in interest not to sue for or claim any damages: (i) for any breach of this Development Agreement; (ii) for the taking, impairment or restriction of any right or interest conveyed or provided hereunder or pursuant hereto; (iii) arising out of or connected with any dispute, controversy, or issue regarding the application or interpretation or effect of the provisions of this Development Agreement; or (iv) for any injury to or interference with the rights of Developer, allegedly or actually arising out of, or incurred in connection with, the Parties entering this Development Agreement, or their exercise of any rights under this Development Agreement. Notwithstanding the forgoing, City shall not be excluded from seeking money damages for non-payment of the Electric Facilities Fee or the Transportation Public Benefit Fee, including attorney fees. In addition, Developer shall 418
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not be excluded from seeking its attorneys fees in the case of a breach of this Agreement by City.

SECTION 17. INDEMNIFICATION AND LEGAL CHALLENGE
A. Claims For Damage For Personal Injuries. To the maximum extent permitted by law, Developer must defend, indemnify, and hold the City and its elected officials, officers, contractors serving as City officials, agents, and employees (“Indemnitees”) harmless from liability for damage and/or claims for damage for personal injuries, including death, and claims for property damage, and with respect to all other actions and liabilities for damages caused or alleged to have been caused by reason of Developer’s activities in connection with the development and/or construction of the Project, and which may arise from the direct or indirect operations of Developer or those of Developer’s contractors, agents, tenants, employees, or any other persons acting on Developer’s behalf, which relate to the development and/or construction of the Project. This indemnity provision applies to all damages and claims for damage, as described above, regardless of whether or not the City prepared, supplied, or approved the plans, specifications, or other documents for the Project, including any associated public or private improvements.

B. Prevailing Wages. Without limiting the generality of the preceding paragraph (A), Developer shall defend, indemnify, and hold the Indemnitees harmless from and against any and all claims, liabilities, losses, damages, costs, and expenses arising from or related to any claims that Developer or Developer’s contractors are required to pay prevailing wages pursuant to Labor Code Section 1720 et seq., in connection with the development of the Project or any public improvements.

C. Third Party Legal Challenge. Without limiting the generality of preceding paragraph A, in the event of any legal action challenging the validity, applicability, or interpretation of any provision of this Development Agreement, any of the entitlement documents pertaining to the Project including, without limitation, the City’s General Plan, Zoning Code, or any other supporting document relating to the Project, Developer shall also indemnify, defend, and hold harmless the Indemnitees with respect to all liability, costs, and expenses incurred by, and/or awarded against, the City or any of the Indemnitees in relation to such action. In addition, the Term, the obligations imposed herein, and the lifespan of all Project Approvals, presently in existence or in existence in the future, shall be extended day for day based upon a timely filed lawsuit challenging the validity or legality of this Agreement and/or any of the Project Approvals, until the date on which said challenge is finally resolved. Developer and City shall promptly notify the other Party to this Agreement upon learning of the filing any such third party litigation.

D. Legal Counsel; Cash Deposit. With respect to any legal action or claim falling within Developer’s defense, indemnity, and hold harmless obligations, the City shall have the right to select counsel of its choice and the Parties shall cooperate in the defense. The City’s separate counsel billing rates shall be identical to the rates City pays for its typical municipal litigation rates for legal challenges of the 419
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variety being defended. Developer shall provide, and maintain for the duration of such action or claim, a cash deposit to City in an amount or amounts determined by the City Attorney to be reasonably necessary to cover the City’s legal fees, costs, and expenses. Developer shall not be entitled to a refund of funds expended from the deposit regardless of the outcome of the action or claim. The City shall refund to Developer any unexpended funds from the deposit within thirty (30) days of any final disposition or full and complete settlement of the action or claim.

E. Continued Effect of Development Agreement. In the event of any litigation challenging the effectiveness of this Development Agreement, or any portion hereof, this Development Agreement shall remain in full force and effect while such litigation, including any appellate review, is pending, unless otherwise ordered by the court. Absent issuance of an injunction, Developer may elect to continue development of the Project under this Development Agreement pending completion of the litigation but it shall do so at its sole risk, and the City shall not be liable for any loss suffered as a result thereof. City shall perform all obligations under this Development Agreement, including the timely processing of all applications submitted by Developer in connection with the Project.

F. Survival. This Section shall survive this the expiration or earlier termination of this Development Agreement. Notwithstanding the foregoing, Developer’s obligation to indemnify any Indemnitee due to personal injury or property injury suffered in connection with Developer’s design and construction of any public facility, shall terminate one (1) year after City accepts Developer’s dedication of such public facility.

SECTION 18. ENTIRE AGREEMENT
This Development Agreement and the Exhibits therein contain the entire agreement between the Parties, and is intended by the Parties to completely state the Development Agreement in full. Any agreement or representation respecting the matters dealt with herein or the duties of any Party in relation thereto, not expressly set forth in this Development Agreement, is null and void.

SECTION 19. AMENDMENT OR CANCELLATION
Except as otherwise provided for herein, this Development Agreement may be amended or canceled in whole or in part only by mutual consent of the Parties, or their successors in interest, and in the manner provided in Gov. Code, §§ 65865.1, 65867, 65867.5.

SECTION 20. OPERATING MEMORANDA
The provisions of this Development Agreement require a close degree of cooperation between the City and the Developer. It is anticipated due to the term of this Development Agreement that non-substantive interpretation of the Development Approvals may be appropriate with respect to the details of performance of the City and the Developer. To the extent allowable by law and this Development Agreement, the City and Developer shall retain a certain degree of flexibility with respect to all matters, items and provisions covered in general under this Development Agreement. The Developer may request 420
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minor changes, adjustments or clarifications under this Agreement and the City and Developer may effectuate such changes, adjustments or clarifications through operating memoranda (“Operating Memoranda”) approved by the Parties in writing, which reference this Section of the Development Agreement. Operating Memoranda shall not constitute an amendment to this Development Agreement but mere ministerial interpretations or clarifications; therefore, public notices and hearings shall not be required. The City Attorney shall be authorized, upon consultation with the Developer, to determine whether a requested interpretation or clarification may be effectuated pursuant to this Section or whether the requested clarification is of such character to constitute an amendment to the Development Agreement which requires compliance with the provisions of this Development Agreement pertaining to amendments. The authority to enter into such Operating Memoranda is hereby delegated to the City Manager, and the City Manager is hereby authorized in his or her discretion to execute any Operating Memoranda permitted hereunder without Planning Commission or City Council action and without public hearing.

SECTION 21. MISCELLANEOUS PROVISIONS
A. Binding Effect. This Development Agreement shall bind, and the benefits and burdens hereof shall inure to, the respective Parties hereto and their legal representatives, executors, administrators, successors and assigns, wherever the context requires or admits.

B. Headings. Headings used in this Development Agreement are for reference purposes only and shall not be deemed a part of this Development Agreement.

C. Exhibits. Each exhibit referenced in this Development Agreement is hereby incorporated into the Development Agreement as if set forth in full herein. In the event of any material discrepancy between the terms of any exhibit so incorporated and the terms of this Development Agreement, the terms of this Development Agreement shall control.

D. Time of Essence. Time is of the essence in every provision hereof in which time is a factor.

E. Force Majeure. In the event that any party hereto shall be delayed or hindered or prevented from performance of any act required hereunder by reason of acts of God, strikes, lockouts, labor troubles, riots, insurrection, terrorism, war, pandemics, epidemics or other reason of similar nature not the fault of the party delayed in performing the work or doing the acts required under the terms of this Development Agreement, then the performance of such act shall be excused for the period of the delay caused by the foregoing. Financial inability shall not be deemed an excuse for delay under this Section.

F. Waiver. No waiver of any default shall constitute a waiver of any other default or breach, whether of the same or other covenant or condition. No waiver, benefit, privilege, or service voluntarily given or performed by a party shall give the other party any contractual rights by custom, estoppel, or otherwise. 421
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G. Cooperation. Each of the Parties shall cooperate with and provided reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Development Agreement and the satisfaction of the conditions of this Development Agreement.

H. City Manager Authority. Any consent, approved or other instrument described in this Development Agreement may be granted, given or executed on behalf of the City by the City Manager or their written designee without the need for further authorization from the City Council; provided, however that, notwithstanding the foregoing, the City Manager or their designee may, in their sole discretion, refer to the City Council any item for which the City Manager has authority to act hereunder.

I. Conflicts of Interest; Prohibited Interests. Developer warrants and maintains as of the Effective Date of this Development Agreement that it has no knowledge that any officer or employee of City has any interest, whether contractual, noncontractual, financial, proprietary, or otherwise, in this transaction or in the business of Developer. If any information regarding an officer of employee of the City having an interest in this transaction or in the business of Developer as of the Effective Date of this Development Agreement comes to the knowledge of Developer at any time during the Term of this Development Agreement, Developer shall immediately make a complete, written disclosure of such interest to the City, even if such interest would not be deemed a prohibited “conflict of interest” under applicable laws. If the City subsequently is provided information that Developer had knowledge but failed to disclose knowledge of any such interest, and Developer fails to acknowledge such interest within 14 days of notification by the City, Developer’s failure shall constitute a breach of the Development Agreement subject to the provisions of Section 14 of this Development Agreement.

J. Applicable Law and Venue. This Development Agreement shall be construed in accordance with and governed by the laws of the State of California. Venue for any action or litigation brought for breach or to enforce any provision of this Development Agreement shall be the County of Riverside, California.

K. Partial Invalidity. If any provisions of this Development Agreement shall be deemed to be invalid, illegal, or unenforceable, the validity, legality, or enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby.

L. Attorneys’ Fees. In any proceedings arising from the enforcement of this Development Agreement or because of an alleged breach or default hereunder, the prevailing party shall be entitled to recover its costs and reasonable attorneys’ fees and experts’ fees incurred during the proceeding (including appeals) as may be fixed within the discretion of the court.

M. Corporate Authority. Each person executing this Development Agreement on behalf of Developer warrants that he or she is duly authorized to execute this 422
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Development Agreement on behalf of Developer and that by his or her execution, Consultant is formally bound to the provisions of this Development Agreement.

N. Counterparts. This Development Agreement may be executed by the Parties in counterparts, which counterparts shall be construed together and have the same effect as if all of the Parties had executed the same instrument.

O. No Third-Party Beneficiaries. This Agreement is made and entered into for the sole protection and benefit of the Parties and their successors and assigns. No other person shall have any right of action based upon any provision of this Development Agreement.

P. Legally Binding Contract; Enforceability. It is the intent of City and Developer that this Development Agreement is a legally binding contract which shall prevail over the provisions of any subsequently enacted moratoria, statutes, ordinances, limitations, or other measures, enacted by City, or under the authority of City by voter initiative or referendum, and which initiative, moratorium, referendum, statute, ordinance, limitation, or other measure relates, in whole or in part, to the rate, timing, sequence, or phasing of the development or construction of all or part of the Project or the improvements or affecting parcel or subdivision maps, building permits, occupancy certificates, or other entitlement to use the Site which are issued by City, subject only to the rights and powers reserved to City under the terms of this Development Agreement and the requirements of California law IN WITNESS WHEREOF, the undersigned have executed this Development Agreement as of the day and year first above-written.

CITY

CITY OF BANNING,
a California municipal corporation
By: _________________________
Sheri Flynn
Mayor
ATTEST:

By: _________________________
Vickie Sellers
City Clerk

DEVELOPER

JDNJ ENTERPRISES, LLC,
a Missouri limited liability corporation
qualified to do business in California
By: JDNJ, LLC, its Manager
By: JDN Holding Co., LLC, its Manager
By: __________________________
James G. Sansone, Manager
By: __________________________
Douglas G. Sansone, Manager
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APPROVED AS TO FORM:

By: _________________________
John O. Pinkney
City Attorney
By: __________________________
Nicholas G. Sansone, Manager
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EXHIBIT A
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EXHIBIT A

SITE LEGAL DESCRIPTION

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF BANNING,

COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

PARCEL 1:

THOSE CERTAIN PARCELS OF LAND LOCATED WITHIN THE MORONGO INDIAN

RESERVATION, LOCATED IN THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, BEING THOSE PORTIONS OF SECTION 1, 2 AND 12 OF TOWNSHIP 3 SOUTH, RANGE 1 EAST, SAN BERNARDINO MERIDIAN, AS SHOWN ON THE OFFICIAL PLAT THEREOF, MORE PARTICULARLY DESCRIBED AS FOLLOWS:

COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 2;

THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 SOUTH 89°40'06" EAST 489.00 FEET TO A LINE PARALLEL WITH AND 489.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 2, SAID POINT BEING THE TRUE POINT OF BEGINNING;
THENCE ALONG SAID PARALLEL LINE NORTH 00°21'44" EAST 342.00 FEET TO A LINE PARALLEL WITH AND 342.00 FEET NORTHERLY OF SAID SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2;
THENCE ALONG SAID PARALLEL LINE SOUTH 89°40'06" EAST 2164.30 FEET TO THE EASTERLY LINE OF SAID SECTION 2;

THENCE CONTINUING ALONG THE EASTERLY PROLONGATION OF SAID PARALLEL LINE SOUTH 88°36'14" EAST 107.02 FEET TO A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 1; THENCE ALONG SAID PARALLEL LINE SOUTH 00°17'18" WEST 270.81 FEET TO THE NORTHERLY LINE OF A STRIP OF LAND 16.50 FEET IN WIDTH, EXCEPTED FROM GRANT DEED REC. 10/7/2004 AS DOC. NO. 2004-0797131, OFFICIAL RECORDS OF THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA (DEPT. OF INT. FILING 582 173Y07);
THENCE ALONG SAID NORTHERLY LINE SOUTH 89°47'09" WEST 107.00 FEET TO THE WESTERLY LINE OF SAID SECTION 1;
THENCE ALONG SAID WESTERLY LINE SOUTH 00°17'18" WEST 16.50 FEET TO THE SOUTHERLY LINE OF THE AFOREMENTIONED 16.50 FOOT STRIP; 426
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EXHIBIT A
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THENCE ALONG SAID SOUTHERLY LINE NORTH 89°47'09" EAST 107.00 FEET TO A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 1;
THENCE ALONG SAID PARALLEL LINE SOUTH 00°17'18" WEST 52.58 FEET TO THE SOUTH LINE OF SAID SECTION 1, SAID POINT IS LOCATED ON A LINE PARALLEL WITH AND 107.00 FEET EASTERLY OF THE WESTERLY LINE OF SAID SECTION 12; THENCE ALONG SAID PARALLEL LINE SOUTH 00°03'26" WEST 1044.17 FEET TO

THE NORTHERLY LINE OF THAT CERTAIN FINAL ORDER OF CONDEMNATION RECORDED AUGUST 19, 1963 AS INST. NO. 87113 AND THAT CERTAIN FINAL ORDER OF CONDEMNATION RECORDED SEPTEMBER 26, 1967 AS INST. NO. 84776, BOTH OF OFFICIAL RECORDS OF SAID COUNTY OF RIVERSIDE. SAID

NORTHERLY RIGHT OF WAY LINE BEING DEPICTED CALTRANS RIGHT-OF-WAY MAP NO. 984524 FILED IN BOOK 204 PAGE 91 OF CALTRANS RIGHT-OF-WAY MAPS AND CALTRANS RIGHT-OF-WAY MAP NO. 452194 FILED IN BOOK 205 PAGE 263 OF CALTRANS RIGHT-OF-WAY MAPS, BOTH ON FILE IN THE MISC. RECORDS OF THE OFFICE OF THE COUNTY SURVEYOR OF SAID COUNTY OF RIVERSIDE; THENCE ALONG SAID NORTHERLY RIGHT-OF-WAY SOUTH 71°02'58" WEST 113.17 FEET TO THE WESTERLY LINE OF SAID SECTION 2;
THENCE ALONG SAID WESTERLY LINE OF SECTION 12 NORTH 00°03'26" EAST 1081.36 FEET TO THE SOUTHEAST QUARTER OF THE AFOREMENTIONED SECTION 12;

THENCE ALONG THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SECTION 2 NORTH 88°36'14" WEST 2641.66 FEET TO THE SOUTH QUARTER CORNER OF SECTION 2;

THENCE ALONG THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2 NORTH 89°40'06" WEST 2161.30 FEET TO THE TRUE POINT OF BEGINNING;

RESERVING THEREFROM AN EASEMENT FOR INGRESS, EGRESS AND UTILITIES, MORE PARTICULARLY DESCRIBED AS FOLLOWS:

COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 2;

THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 SOUTH 89°40'06" EAST 2583.30 FEET TO A POINT 67.00 FEET WESTERLY OF THE SOUTH QUARTER CORNER OF SAID SECTION 2, SAID POINT IS THE TRUE POINT OF BEGINNING;
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EXHIBIT A
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THENCE NORTH 00° 21'44" EAST 342.00 FEET TO A LINE PARALLEL WITH 342.00

FEET NORTHERLY OF SAID SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SECTION 2;
THENCE ALONG SAID PARALLEL LINE SOUTH 89°40'06" EAST 69.98 FEET TO A LINE PARALLEL WITH AND 342.00 FEET NORTHERLY OF THE SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 2;
THENCE ALONG SAID PARALLEL LINE SOUTH 88°36'14" EAST 30.02 FEET; THENCE SOUTH 00°21'44" WEST 342.06 FEET TO THE AFOREMENTIONED SOUTHERLY LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 2; THENCE ALONG SAID SOUTHERLY LINE NORTH 88°36'14" WEST 33.02 FEET TO THE SOUTH QUARTER CORNER OF SAID SECTION 2;

THENCE ALONG THE SOUTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 2 NORTH 89°40'06" WEST 66.98 FEET TO THE TRUE POINT OF BEGINNING.

APN: 532-030-008, 532-030-009, 532-080-008, 532-080-010, 532-090-026, 532-090- 028 AND 532-090-030
PARCEL 2:

THAT PORTION OF THE NORTHEAST 1/4 OF SECTION 11, TOWNSHIP 3 SOUTH, RANGE 1 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO UNITED

STATES GOVERNMENT SURVEY, LYING NORTHERLY OF THAT CERTAIN PORTION OF SAID NORTHEAST 1/4 CONVEYED TO THE STATE OF CALIFORNIA BY DEED RECORDED OCTOBER 11, 1961, AS INSTRUMENT NO. 87046 IN BOOK 2997, PAGE 542, OFFICIAL RECORDS.

EXCEPTING THEREFROM, ALL RIGHT, TITLE AND INTEREST IN AND TO ALL

HYDROCARBONS, MINERALS, GEOTHERMAL RESOURCES, AND MINERAL ORES

OF EVERY KIND AND CHARACTER, METALLIC OR OTHERWISE, SOLID, LIQUID OR

GAS AND WHETHER OR NOT HEREAFTER KNOWN TO SCIENCE OR INDUSTRY,

NOT KNOWN TO EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR

UNDERLYING THE SURFACE OF SAID LAND AS SHOWN IN DEED RECORDED JANUARY 28, 1987 AS INSTRUMENT NO. 24458 OF OFFICIAL RECORDS OF RIVERSIDE COUNTY, CALIFORNIA.

APN: 532-110-015
PARCEL 3:
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EXHIBIT A
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A NON-EXCLUSIVE EASEMENT FOR ROAD PURPOSES UPON, OVER AND ACROSS THAT PORTION OF THE EAST 1/2 OF THE NORTHWEST 1/4 OF SECTION 11, TOWNSHIP 3 SOUTH, RANGE 1 EAST, SAN BERNARDINO BASE AND MERIDIAN, INCLUDED WITHIN A STRIP OF LAND 20 FEET WIDE, THE NORTHERLY LINE OF WHICH IS DESCRIBED AS FOLLOWS:

BEGINNING AT A POINT IN THE EAST LINE OF THE SAID NORTHWEST 1/4, DISTANT ALONG SAID EAST LINE SOUTH 0°41'41" WEST 1359.31 FEET FROM A 3/4 INCH IRON PIPE AND BRASS CAP MARKED "U.S.G.L.O. 1917" SET FOR THE NORTH 1/4 CORNER OF SAID SECTION;
THENCE NORTH 89°25'57" WEST, 1319.31 FEET TO THE WEST LINE OF THE SAID EAST 1/2.

ALSO THAT PORTION OF THE WEST 20 FEET OF SAID EAST 1/2 LYING SOUTHERLY OF THE SOUTHERLY LINE OF THE ABOVE DESCRIBED 20 FOOT STRIP.

EXCEPT THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE:

BEGINNING AT A POINT IN THE WEST LINE OF SAID EAST 1/2, DISTANT ALONG SAID WEST LINE SOUTH 0°25'01" WEST 1041.97 FEET FROM THE POINT OF

INTERSECTION THEREOF WITH THAT CERTAIN LINE HEREINABOVE DESCRIBED AS HAVING A BEARING OF NORTH 89°25'57" WEST;
THENCE NORTHEASTERLY ALONG 545 FOOT RADIUS CURVE CONCAVE NORTHWESTERLY FROM A TANGENT BEARING NORTH 56°01'51" EAST, THROUGH AN ANGLE OF 1°46'36", A DISTANCE OF 16.90 FEET; THENCE NORTH 54°15'15" EAST 50 FEET, AS CREATED IN DEED RECORDED JUNE 10, 1968 AS INSTRUMENT NO. 53726, OFFICIAL RECORDS. 429
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EXHIBIT B
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EXHIBIT B

DIF SCHEDULE AS OF EFFECTIVE DATE
City of Banning Development Impact Fees1
Land Use Category Fire
Facilities
General
City
Facilities
Police Traffic Water Wastewater2
Nonresidential – Fee
per 1,000 Square Feet
- Industrial $236.00 $239.00 $170.00 $1,791.69
Per Table

8.5 in City
Council
Resolution
2019-112
$708.54
1 Represents the City of Banning Development Impact Fees for non-residential land uses effective November 9, 2019 per City Council Resolution No. 2019-112. 2 Wastewater Facilities Fee shown as per 1 EDU. Wastewater Facilities EDU Factors for every 1,000 square feet are 0.37 for Commercial, 0.13 for Office and 0.14 for Industrial.

City of Banning Development Impact Fees (cont’d.)
Land Use Category TUMF
3 MSHCP3
Industrial $2.33 per square foot
$20,191 per acre
Class A/B Office $2.45 per square foot
3 TUMF and MSHCP subject to annual increases.
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EXHIBIT C
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EXHIBIT C

HATHAWAY IMPROVEMENTS
The following shall be completed to the satisfaction of the City Engineer:
 Along the west side of N Hathway Street between E Williams Street and E George Street, install City standard sidewalk behind curb and gutter, and install city standard curb ramps at intersections. Install new residential driveways as necessary to maintain access to existing driveway locations.  Within the existing right-of-way and pavement along the west side of N Hathway Street between E Williams Street and future Wilson Street, install striping for a new 6 ft. bike lane.
 Within the existing right-of-way and pavement along the east side of N Hathway Street between E Williams Street and existing Nicolet Street, install striping for a new 6 ft. bike lane.
 At the intersection of E Jacinto View Road and N Hathway Street, provide traffic measure to restrict Project traffic from access to E Jacinto View Rd  At the intersection of E Nicolet Street and N Hathway Street, provide traffic measure to restrict Project traffic from access to E Nicolet Street  At the intersection of E George Street and N Hathway Street, provide traffic measure to restrict Project traffic from access to E George Street 431

AFFIDAVIT OF PUBLICATION
Record Gazette
218 N. Murray St., Banning, CA 92220
Proof of Publication
(2015.5 C.C.P.)
City of Banning PHN CC Meeting 9-23
___________________________________________________
State of California          )
County of Riverside   )  SS.

I am a citizen of the United States and a resident of the State of California; I am over the age of eighteen years, and not a party to or interested in the above matter. I am the principal clerk of the printer and publisher of Record Gazette, a newspaper published in the English language in the City of Banning, County of Riverside, and adjudicated a newspaper of
general circulation as defined by the laws of the state of California by the Superior Court of the County of Riverside, under the date October 14, 1966, Case No. 54737.

That the notice, of which the annexed is a copy, has been published in each regular and entire issue of said newspaper and not in any supplement thereof on the following dates, to-wit:

Sep 12, 2025
Executed on: ____________________
At City of Banning, California
I ceritfy (or declare) under penalty of perjury that the foregoing is true and correct.
___________________________________________________
Signature
City of Banning PHN CC Meeting 9-23 | Page 1 of 2
September 12 2025
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City of Banning PHN CC Meeting 9-23 | Page 2 of 2
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CITY OF BANNING

STAFF REPORT
TO: CITY COUNCIL
FROM: Arturo Vela, Interim City Manager
PREPARED BY: Mark Staples, Planning Manager
David Newell, Community Development Director
MEETING DATE: September 23, 2025
SUBJECT:

Consideration of Resolution 2025-135 Approving a Cannabis Conditional Use Permit (CUP) Application Case No. PLN 24-0107, by Flower Dept, LLC to Allow for the Commercial Cultivation of Cannabis (Project) within an Existing 8,041-square foot Industrial Building at 200 John Street, in the Industrial (I) Zoning District (APN 541-220-006)
RECOMMENDATION:

Adopt Resolution 2025-135.

BACKGROUND:

The project applicants are requesting a Cannabis – Conditional Use Permit to operate the commercial cultivation of cannabis within an existing 8,041 square-foot vacant industrial building located at 200 John Street (Project). The project applicants are also proposing tenant improvements to the interior building consisting of grow rooms, dry/trim/harvesting rooms, office/security room, storage room, break room, and employee restrooms.

The Project will include an access easement by a paved driveway off Galleher Way. The property owner, Flower Dept., LLC, has negotiated an access easement at the end of a cul-de-sac on Galleher Way to allow vehicle ingress/egress to the Project across the eastern portion of the property at 313 Galleher Way. Project access off John Street will be closed to all vehicles. Project-related business traffic will be conducted exclusively through the new, dedicated ingress/egress easement on Galleher Way.

One condition that the Planning Commission recommended, but staff is not pursuing, for this project before the City Council, is related to the access easement from Galleher Way to the project site. The Commission recommended that the project switch from a recorded access easement across the property at 313 Galleher Way to the project site, to a Lot Line Adjustment that alters both properties shape to provide 200 John Street its own frontage along the cul-de-sac of Galleher Way. Staff in the Planning and Public Works Departments have processed a draft access easement that is ready to record pending approval of the project. A change in process would unnecessarily result in more staff time, applicant’s surveyor’s time, and added expenses to the project. Access easements across properties are a common practice in commercial shopping centers and industrial properties. Both processes provide the same permanent recorded access to the project site. The property owners of 200 John Street and 313 Galleher Way have tentatively agreed to the access easement. Staff recommends continuing with the access easement and require that it is to be recorded prior to issuance of Certificate of Occupancy. 434
Zoning:

The Zoning District is Industrial (I). The use is permitted under Title 17 of the Banning Municipal Code (BMC) that provides Cannabis Commercial Indoor cultivation subject to approval of a Cannabis – Conditional Use Permit by the City Council, after recommendation by the Planning Commission (Chapters 17.52 and 17.53 of the Zoning Code).

Additional requirements identified in the Code state the cannabis cultivator must be at least 600-feet from any day care center, youth center, public or private school providing instruction in any public or private school setting, up to and including High School. The Project is not located within 600 feet of any public or private park. The proposed location of the Commercial Cannabis Cultivation facility is compliant with the above-mentioned requirements.

Address Update:

The project site was originally identified as 200 John Street (APN: 541-220-006). However, due to the establishment of a new vehicular access easement connecting the site to Galleher Way, the City will initiate a formal address change. The site will be recognized as 319 Galleher Way to reflect the new point of access and ensure accurate addressing for public safety, emergency response, and utility coordination.

All future references to the property for permitting, licensing, and compliance purposes will utilize the updated address: 319 Galleher Way, Banning, CA 92220.

Operating Characteristics:

The proposed cannabis cultivation facility will operate daily from 6:00 AM to 10:00 PM. Flower Dept., LLC has submitted comprehensive operations plan covering safety, security, odor control, and waste management. Security features include 24/7 video surveillance, proximity card access, alarm systems, secure storage, and on-site security personnel. Inventory control will utilize METRC, with regular audits and robust waste tracking protocols. Odor mitigation/prevention will rely on carbon filtration, and the business will employ water- and energy-efficient practices. The applicant has committed to hiring locally, supporting community engagement, and generating local tax revenue.

PLANNING COMMISSION:

Public Hearing July 9, 2025:

The Planning Commission conducted a public hearing to make a recommendation to the City Council to either approve, conditionally approve or not approve a Cannabis – Conditional Use Permit (PLN 24- 0107) application (Project) submitted by the Project Applicants, Flower Dept LLC.

Commissioners noted that some conditions of approval needed revisions regarding site inspections, screening of loading areas, filtration systems to prevent odors, the business required to have a community relations representative with their contact information publicly available, recording a public access agreement prior to Certificate of Occupancy, and the business to provide quarterly operations reports on community complaints on operations and odor prevention.

Further, the Planning Commission expressed concern regarding whether the Project qualified for a CEQA Categorical Exemption.

The Planning Commission passed a motion to continue the public hearing to a Special Meeting on August 6, 2025.

Public Hearing August 6, 2025:

The Planning Commission continued their public hearing to make a recommendation to the City Council to either approve, conditionally approve or not approve a Cannabis – Conditional Use Permit for the Project.
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Planning Staff worked with the project applicants to specifically address Planning Commission concerns involving project operations, focused on cannabis site inspections, odor filtration systems to prevent odors, business community relations and quarterly operation reports. Staff further explored review of CEQA Categorical Exemptions involving cannabis operations.

The project applicants agreed to adding and revising conditions of approval attached herein.

Planning Staff also reviewed CEQAnet (the online source of state CEQA determination filings by all cities, counties, and other agencies) and found that most cannabis projects have utilized the Section 15301 Categorical Exemption. Staff findings disclosed that most cannabis commercial or industrial operations that utilized existing buildings qualified under CEQA Section Categorical Exemption.

Categorical Exemption projects also included odor prevention reporting.

Those cannabis projects that required further CEQA analysis through a Mitigated Negative Declaration (MND) or Environmental Impact Report (EIR) involved new larger ground up construction or large outdoor growing and cultivation facilities (i.e. 30,000 s.f. or greater properties/greenhouses). Other cannabis facilities involved indoor cultivation have discussed odor mitigation plans but have not considered those emanating from cannabis growth and harvesting as part of a greenhouse gas (GHG) emissions air quality analysis. For projects with new construction, the Air Quality analysis involved more discussion on the emissions from grading activities and construction equipment and less about odors from the cannabis activity. Most projects were conditioned to submit regular odor mitigation reporting similar to what is conditioned for this project.

At the conclusion of the August 6, 2025 meeting the Planning Commission voted 3-2 and adopted Resolution 2025-06 recommending the City Council approve the Project application and making a determination that the project qualifies as a Categorical Exemption per the CEQA Guidelines Section 15301 for Existing Facilities.

DESCRIPTION:

Existing Conditions:

The project site consists of an existing, single-story, 8,041-square-foot industrial building. The structure is currently vacant. The 0.61-acre net lot is paved and contains no outdoor storage. The site is flat, developed, and not subject to environmental constraints.

In the tables that follow are the adjacent street conditions and surrounding properties uses, general plan designations, and zoning designations.

Existing Street Improvement Conditions
Street Name Travel Lanes Curb & Gutter Sidewalk
Galleher Way Y Y Y
Surrounding Property
Existing Land Use Per
Chapter 17
Existing General
Plan Designation
Existing Zoning
Designation
Subject Property Industrial Industrial Industrial
North Railroad/Public Facility
Public Facilities –
Railroad/Interstate
(PF-RI)
PF-RI
South Industrial Building Industrial Industrial
East Power Plant Industrial Industrial
West Industrial Building Industrial Industrial
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Project Compliance with Standards:

Pursuant to BMC Section 17.12.030, the following development standards apply:

Industrial Zone Standard
Required/
Allowed
Provided Compliance
Min. Lot Size 10,000 SF 25,265 SF Y
Min. Lot Width (Feet) 70
386’ - 10 3/8” North
252’ - 2” South
Y
Min. Lot Depth (Feet) 100 110’ 1” Y
Min. Setbacks (Feet)
· Front (South)
· Street Side (East)
· Side (West)
· Rear (North)
10’
10’
0’
0’
10’
10’
0’
0’
Y
Y
Y
Y
Max. Bldg. Coverage 60% 32% Y
Max. Building Height
2 Stories
50 Feet
1 Story
24’-11”
Y
Perimeter Wall Height
· North
· South
· East
· West
8 Feet
8 Feet
8 Feet
8 Feet
6’ fence
New 6’ block wall to
screen w/sliding gate
6’ fence
6’fence
Y
Y
Y
N/A
Trash Enclosure
Screened
6’ High (bin)
3’-6” High (cans)
Y
6’
Y
Y
Mechanical Equipment Screened Screened Y
Pursuant to BZO Section 17.28.040, the following parking standards apply:

Use
SF or # of
Units
Parking
Ratio
Required Provided Compliance
Indoor Cannabis
Cultivation
8,041 SF
2+ 1/1,000 SF 10 N/A
Office (two) 116 1/200 1 N/A
TOTAL SPACES: 11 11 Y
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Regular and Handicap Spaces: 2 ADA 9 Regular
Site Plan:

The proposed project is located on a 0.61-acre parcel developed with an existing 8,041-square-foot industrial building. The building is centrally located on the site, with vehicle access exclusively via a new access easement at the northern terminus of Gallaher Way. Access from John Street will be permanently restricted. Parking and driveway areas, totaling approximately 6,436 square feet, are located on the south and east sides of the building, with two spaces on the north side of the building, and are separated from the public street, consistent with BMC 17.12.110(H) and (O).

The site layout avoids expansive parking fields and instead clusters parking to support the primary use, in line with BMC 17.12.100(J). The layout allows for efficient vehicular circulation while minimizing pedestrian conflict, as encouraged by BMC 17.12.100(C) and BMC 17.12.110(K). While this is a singleuse building, it is oriented to the internal access point rather than the public right-of-way, given the nature of its industrial use and access requirements. Loading areas are confined to the south side/rear of the site, and will be screened with a 6-foot high decorative block wall, in compliance with BMC 17.12.100(H).

Mass and Scale:

The Project involves the reuse of an existing single-story industrial building totaling 8,041 square feet. No additions or exterior structural changes are proposed, and the height, bulk, and overall mass will remain consistent with the original construction. The building is typical in size and scale for the Industrial (I) zoning district and is compatible with surrounding development.

The Project site upgrades and proposes, new landscaping, secured access from Galleher Way, and screened parking, support improved site functionality. The project maintains a low profile, consistent with the surrounding built environment, and requires no transition in height or mass due to the compatible design with adjacent industrial uses.

JUSTIFICATION:

In order to approve the Cannabis – Conditional Use Permit application, Case PLN 24-0107, the City Council is required to make findings pursuant to Chapter 17.52 of the BMC Zoning Ordinance, and Chapter 17.53 of the BMC Zoning Ordinance, Section 17.53.060. Procedures and Findings for Approval of Cannabis Conditional Use Permit. The Planning Commission recommended approval of the Cannabis – Conditional Use Permit application for Case PLN 24-0107 pursuant to the findings in Planning Commission Resolution 2025-06. The findings are included in the draft resolution attached to this report.

Finding A: The proposed use is consistent with the General Plan.

Finding of Fact: The proposed Project cannabis cultivation is consistent with the General Plan’s designation for industrial development in the area, which supports cannabis cultivation, warehousing and office uses. Further, Conditional Use Permit 24-0107 is consistent with General Plan Economic Development Policy, which states: “The City shall take a proactive role in the retention of existing businesses and the recruitment of new businesses, particularly those that generate and broaden employment opportunities, increase discretionary incomes, and contribute to City General Fund revenues.” Approval of proposed Cannabis - Conditional Use Permit Case No. 24-0107 would allow the applicant to promote business diversity, while providing an economic benefit to the City.

Finding B: The proposed use is conditionally permitted with the Industrial zoning district and complies with all of the provisions of BMC Chapter 17 of the BMC.

Finding of Fact: The proposed project complies with the applicable requirements of the Industrial (I) zoning district as outlined in BMC Chapters 17.12 and 17.53. The project meets or exceeds all applicable development standards, including lot size, setbacks, building height, and parking requirements, ensuring 438
conformance with the zoning ordinance for industrial uses. Table 17.12.020 (“Permitted, Conditional and Prohibited Commercial and Industrial Uses”) of Section 17.12.020 of Chapter 17.12 of Title 17 of the Banning Municipal Code provides that “Cannabis Commercial Indoor Cultivation”, is a conditionally permitted use in the Industrial zoning district. The proposed Cannabis Cultivator complies with all other applicable provisions of Title 17 of the Banning Municipal Code, including the standards set forth in Section 17.12.050.V. applicable to Cannabis Cultivator (Use Specific Development Standards). Lastly, the proposed project complies with the provisions of Chapter 17.53, including standards regarding the premises, personnel, security, cannabis tracking and tracing, signage, waste management, sanitary requirements, and odor control.

Finding C: The proposed use would not impair the integrity and character of the land use district in which it is to be located.

Finding of Fact: The proposed use is located on the former right-of-way of John Street, located in the northern end of Galleher Way. Adjacent properties consist of other industrial uses, including cannabis cultivation, towing yards, plumbing supply, and energy management. Access ingress/egress to the Project is via an access easement at the north end of the Galleher Way. It is anticipated that the area would contain indoor commercial cannabis cultivation which is conditionally permitted within the City under Banning Municipal Code Chapter 17.53 Cannabis Conditional Use Permits.

Finding D: The subject site is physically suitable for the type and intensity of land use being proposed.

Finding of Fact: The subject site currently consists of an existing industrial warehouse building and the applicant is proposing interior changes to the building to create the growing room setting needed for cannabis cultivation. Furthermore, the project site will utilize existing paved areas for adequate parking, access, and lighting. The building is of adequate size and design to accommodate cannabis cultivation.

Finding E: There are adequate provisions for water, sanitation, and public utilities and services to ensure that the proposed use would not be detrimental to public health and safety.

Finding of Fact: The existing project site and structure are currently tied to the local water, sewer, and Banning Electric Utility public utility system.

Finding F: There will not be significant harmful effects upon environmental quality; natural resources; or neighborhood characteristics.

Finding of Fact: The proposed Cannabis – Conditional Use Permit is exempt from the requirements per Section 15301 of the CEQA Guidelines as the proposed project is utilizing an existing structure with no proposed expansion of the structure or use.

Finding G: The proposed location, size, design, and operating characteristics of the proposed use will not be detrimental to the public interests, health, safety, convenience, or welfare of the City of Banning.

Finding of Fact: The proposed location, design, and operating characteristics of the proposed cannabis cultivation facility will not be detrimental to the public interests, health, safety, convenience, or welfare of the City of Banning and will complement existing cannabis and industrial businesses located on Galleher Way. Cannabis related activities are regulated by the State of California, Bureau of Cannabis Control (BCC). The applicant must maintain a valid BCC license to be compliant with the Banning Municipal Code and BCC. If determined for good cause that the continuance of such license would be contrary to the public safety and welfare, the City of Banning and the BCC are authorized to suspend or revoke any license.

ENVIRONMENTAL DETERMINATION:

Planning staff has determined that the project qualifies for a Class 1 Categorical Exemption under the California Environmental Quality Act (CEQA), pursuant to CEQA Guidelines Section 15301 – Existing Facilities. This exemption applies when a project involves interior or exterior tenant improvements, maintenance, permitting, or licensing of an existing structure where there is negligible or no expansion of use or capacity.

This project involves converting an existing 8,041-square foot vacant industrial building into a cannabis 439
cultivation facility through tenant improvements only, such as partitioning, HVAC, electrical upgrades, and plumbing, with no change to the exterior footprint, height, or building coverage. The site is fully developed and served by existing utilities, and it is not located on environmentally sensitive lands or hazardous sites. There is no evidence of cumulative impacts or unusual circumstances that would affect scenic or historic resources, as similarly concluded for prior cultivation projects in the City. The proposed project and cultivation business is subject to the submission of quarterly reports that outline their operations and cataloguing nuisance odors and other community complaints.

Based on these considerations, the project meets the criteria for a Class 1 exemption. A Notice of Exemption will be filed with the Riverside County Clerk following the City Council’s approval.

FISCAL IMPACT:

Economic Benefit:

The Project Applicants anticipate 6-10 full-time employment positions created by the Project. The Project Applicant has committed to hiring locally, supporting community engagement, and generating local tax revenue.

Per BMC 3.17.030(B) a cannabis cultivation facility shall pay to the City an annual cannabis business tax in an amount that is equal to $15 per square foot of canopy space. Should the business utilize 6,000 square feet of double stacked canopy space, the annual cannabis business tax should equate to approximately $180,000 per year.

ALTERNATIVES:

N/A
BUDGETED?:

Yes
CONTRACT/AGREEMENT:

No
ATTACHMENTS:

1. 1. PLN 24-0107 CC RESO 09232025.docx

2. 2. PLN 24-0107 CC COA 09232025 .v1.docx

3. 3. PLN_24-0107_Map_Exhibits 09232025.pdf

4. 4. PLN 24-0107 CC Plan Sets 09232025.pdf

5. 5. APPROVED-PC_Minutes_ 08062025.pdf

6. 6. APPROVED-PC_ Minutes_07092025.pdf

7. 7. APPROVED-PC_Resolution_08062025.pdf

8. 8. PLN_24-0107 PC__COA_08062025.pdf

9. 9. PLN_24-0107_Flower_Dept_LLC_Application.pdf

10. 10. PLN 24-0107 CEQAnet DCC Filings.09232025.pdf

11. 11. CITY COUNCIL PUBLIC NOTICE_PLN 24-0107_09232025 -.pdf

12. 12. PLN 24-0107 NOE.pdf

13. 200 John St_PLN 24-0107_affidavit.pdf
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Resolution 2025-135

RESOLUTION 2025-135

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BANNING,

CALIFORNIA, THAT THE CITY COUNCIL MAKE A DETERMINATION OF EXEMPTION UNDER CEQA GUIDELINES SECTION 15301 AND APPROVE A CANNABIS – CONDITIONAL USE PERMIT (CUP) CASE NO. PLN 24-0107, BY FLOWER DEPT., LLC TO ALLOW FOR COMMERCIAL CULTIVATION OF CANNABIS WITHIN AN EXISTING 8,041 SQUARE-FOOT INDUSTRIAL BUILDING AT 200 JOHN STREET, BANNING, CA IN THE INDUSTRIAL (I) ZONING DISTRICT (APN: 541-220-006).

WHEREAS, Ricardo Alcantara and Laura Leindecker (the “Project Applicants”) on behalf of Flower Dept., LLC (the “Project Owner”) has applied for a Cannabis – Conditional Use Permit, Case No. PLN 24-0107, to allow for commercial cultivation of cannabis the (“Project”) within an existing 8,041 square foot industrial building in the Industrial (I) Zoning District; and WHEREAS, pursuant to Section 17.04.060.A. of the Banning Municipal Code (BMC), the City Council has the authority to review and approve or conditionally approve the subject applications, including determinations on any associated environmental impacts in accordance with the California Environmental Quality Act (CEQA) for the Project; and WHEREAS, the Planning Commission made a recommendation to the City Council regarding a proposed Cannabis - Conditional Use Permit per Chapter 17.53 Cannabis Conditional Use Permits of the Banning Municipal Code (BMC); and
WHEREAS, on June 27, 2025, the City gave public notice by advertising in the Record Gazette, a newspaper of general circulation within the City of Banning, and by mailing notices to property owners within 300 feet of the project site for a public hearing to be held on July 9, 2025; and WHEREAS, on July 9, 2025, the Planning Commission held a duly noticed public hearing at which time interested persons had an opportunity to testify in-support of or in-opposition to Cannabis – Conditional Use Permit, Case No. PLN 24-0107; and
WHEREAS, on July 9, 2025, the Planning Commission considered staff and public testimony on the Project and Cannabis – Conditional Use Permit, Case No. PLN 24-0107 and voted 4-0 to continue the public hearing to a special Planning Commission meeting on August 6, 2025, to consider additional information; and
WHEREAS, on August 6, 2025, the Planning Commission voted 3-2 and adopted Resolution 2025-06 recommending to the City Council approval for the Project application; and WHEREAS, on August 6, 2025, the Planning Commission in accordance with the requirements of CEQA, staff determined that the Project and Cannabis – Conditional Use Permit, PLN 24-0107, qualifies for a Categorical Exemption pursuant to CEQA Guidelines Section 15331 (Class I – Existing Facilities) and no further environmental analysis is required.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Banning as follows:

SECTION 1. ENVIRONMENTAL DETERMINATION
The proposed project is Categorically exempt under CEQA Guidelines Section 15301 (Class 1 – 441
Resolution 2025-135

Existing Facilities). The Project is consistent with the General Plan and Zoning Ordinance, occurs within city limits on a site less than five acres in size. The Project shall consist of operation, repair, maintenance, permitting, leasing, licensing, and minor alter of an existing private struct involving negligible or no expansion of existing or former use, including interior or exterior alterations involving such things as interior partitions, plumbing and electrical conveyances. The Planning Commission has reviewed staff determination of exemption, and based on its own independent judgement, recommends that the City Council concur in the staff determination of exemptions.

SECTION 2. REQUIRED FINDINGS FOR CANNABIS – CONIDITIONAL USE PERMIT PLN 24- 0107
Chapter 17.53 of the City of Banning Zoning Ordinance requires that Cannabis Conditional Use Permit applications meet certain Findings prior to the approval recommendation by the Planning Commission. The Planning Commission does hereby find and determines that Case PLN 24-0107 should be approved because:

Finding A: The proposed use is consistent with the General Plan.

Finding of Fact: The proposed Project cannabis cultivation is consistent with the General Plan’s designation for industrial development in the area, which supports cannabis cultivation, warehousing and office uses. Further, Conditional Use Permit 24-0107 is consistent with General Plan Economic Development Policy, which states: “The City shall take a proactive role in the retention of existing businesses and the recruitment of new businesses, particularly those that generate and broaden employment opportunities, increase discretionary incomes, and contribute to City General Fund revenues.” Approval of proposed Cannabis - Conditional Use Permit Case No. 24-0107 would allow the applicant to promote business diversity, while providing an economic benefit to the City.

Finding B: The proposed use is conditionally permitted with the Industrial zoning district and complies with all of the provisions of BMC Chapter 17 of the BMC.

Finding of Fact: The proposed project complies with the applicable requirements of the Industrial (I) zoning district as outlined in BMC Chapters 17.12 and 17.53. The project meets or exceeds all applicable development standards, including lot size, setbacks, building height, and parking requirements, ensuring conformance with the zoning ordinance for industrial uses. Table

17.12.020 (“Permitted, Conditional and Prohibited Commercial and Industrial Uses”) of Section

17.12.020 of Chapter 17.12 of Title 17 of the Banning Municipal Code provides that “Cannabis Commercial Indoor Cultivation”, is a conditionally permitted use in the Industrial zoning district.

The proposed Cannabis Cultivator complies with all other applicable provisions of Title 17 of the Banning Municipal Code, including the standards set forth in Section 17.12.050.V. applicable to Cannabis Cultivator (Use Specific Development Standards). Lastly, the proposed project complies with the provisions of Chapter 17.53, including standards regarding the premises, personnel, security, cannabis tracking and tracing, signage, waste management, sanitary requirements, and odor control.

Finding C: The proposed use would not impair the integrity and character of the land use district in which it is to be located.

Finding of Fact: The proposed use is adjacent to John Street, located in the north section area of Galleher Way. Access ingress/egress to the Project is via a newly created easement at the end of the Galleher Way. It is anticipated that the area would contain commercial indoor cannibal cultivation currently permitted within the City under Banning Municipal Code Chapter 17.53 Cannabis Conditional Use Permits.
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Resolution 2025-135