Banning City Council
July 14, 2026

July 14, 2026
5:00 p.m.

In Chambers
Council Chambers
99 E. Ramsey Street
Banning, CA 92220

1. CALL TO ORDER
AGENDA

CITY COUNCIL - REGULAR MEETING

CITY OF BANNING, CALIFORNIA
The following information comprises the agenda for the regular meeting of the Banning City Council, a joint meeting of the City Council and Banning Utility Authority, and the Banning City Council sitting in its capacity as the Banning Successor Agency Board.

This meeting is being held via Zoom so that members of the public may observe and participate in this meeting electronically. If you participate in this meeting via Zoom, you are agreeing to abide by the City's Zoom Community Standards for Public Meetings (provided in full on the last page of the agenda). Esta reunión se lleva a cabo en la Cámara y a través de Video/Teleconferencia en Zoom para que los miembros del público puedan observar y participar en esta reunión de manera electrónica. Si elige participar en esta reunión a través de Zoom, acepta cumplir con los Estándares comunitarios de Zoom para reuniones públicas de la ciudad (que se proporcionan en su totalidad en la última página de la agenda).

To observe and participate in the online video portion of the meeting through your personal computer or device, follow this link:
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Meeting ID: 820 1264 4588
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Join Via Audio/Passcode: 8464147627 - *9 raise hand
Per the City of Banning Manual of Procedural Guidelines, matters taken up by the Council before 10 p.m. may be concluded, but no new matters shall be taken up except upon a majority vote of the council members present and voting. Such an extension shall only be valid for one hour and each hour thereafter shall require a renewed action for the meeting to continue.

TELECOMMUTING LOCATION
The following Council Members will participate remotely from the locations listed below:

Mayor Pro Tem, CindyBarrington - 77090 Rutters Rd., Clatskanie, OR. 97016 Council Member, Sheri Flynn - 7900 Ella Lee Lane, Austin TX. 78744

1.1 ROLL CALL
City Council - Regular Meeting Agenda
July 14, 2026
1 2. AGENDA APPROVAL

3. PRESENTATIONS

4. REPORT ON CLOSED SESSION

5. PUBLIC COMMENTS, CORRESPONDENCE, APPOINTMENTS, AND REPORTS

6. CONSENT ITEMS

6.1 Consideration and Approval of the Meeting Minutes of the May 12, 2026, Regular City Council Meeting and the May 14, 2026, Workshop City Council Meetings.

6.2 Approval of City Attorney Invoices for the Month of June 2026

6.3 Authorize the City Manager to sign the Notice of Completion for “Banning Boy Scouts Club Building Environmental Clean-Up, Abatement, and Demolition Project” as complete and direct the City Clerk to record the Notice of Completion.

6.4 Public Works Capital Improvement Project Tracking List

6.5 Consideration of Second Reading and Adoption of Ordinance No. 1624, Zoning Text

1.2 INVOCATION
Performed by Pastor Preston Noman of Praise Tabernacle Community Church

1.3 PLEDGE OF ALLEGIANCE

2.1 AGENDA APPROVAL
Phaedra Norton, City Attorney

5.1 PUBLIC COMMENTS

5.2 CORRESPONDENCE

5.3 APPOINTMENTS

5.4 CITY COUNCIL COMMITTEE REPORTS

5.5 ANNOUNCEMENTS OF CITY COUNCIL MEMBERS

5.6 CITY MANAGER'S REPORT

5.7 CITY ATTORNEY'S REPORT
The following items have been recommended for approval and will be acted upon simultaneously, unless a member of the City Council/Banning Utility Authority/Successor Agency Board wishes to remove an item for separate consideration.

Recommendation: Approve the Meeting Minutes of the May 12, 2026, Regular City Council Meeting and the May 14, 2026, Workshop City Council Meetings.

Recommendation: Approve the attorney invoices for June 2026 as presented in the amount of $118,090.68
Recommendation: Authorize execution of the Notice of Completion.

Recommendation: Receive and file.

City Council - Regular Meeting Agenda
July 14, 2026
2 Amendment PZTA 26-0001(Accessory Dwelling Units and Junior Accessory Dwelling Units).

6.6 Consideration of Resolution 2026-100, Approval of ERF-2-R Grant Agreement Amendment No.1 to Standard Agreement No. 23-ERF-2-R-10022 with the California Department of Housing and Community Development for the Encampment Resolution Funding Program Round 2 Rolling grant

6.7 Consideration of Resolution 2026-105, Approving an Agreement with Altec Industries, Inc., a Sole Source Provider, for Onsite Inspections and Repair of Bucket Trucks “Not to Exceed” an Annual Aggregate of $60,000 for Fiscal Year 2027 with the Option for Annual Renewals

6.8 Consideration of Resolution 2026-107, accepting a donation from the Morongo Band of Mission Indians for $25,000 to support the Fourth of July Celebration and the Aerial Fireworks Show

6.9 Consideration of Resolution 2026-108, Approving a Cooperative Agreement with the County of Riverside and Authorizing the City of Banning's Participation in the County of Riverside's Urban County Program for Fiscal Year's 2027, 2028, and 2029.

6.10Consideration of Resolution 2026-109, Awarding Professional Services Agreements to Blais & Associates, Evan Brooks Associates, and Townsend Public Affairs for On-Call Grant Writing and Grant Management Services in a Total Aggregate Not-to-Exceed Amount of $100,000 for the initial term, with Renewal Options, and Rejecting All Other Proposals

7. PUBLIC HEARINGS

8. REPORTS OF OFFICERS

8.1 Discussion Regarding the Status of the City's Emergency Operations Plan and Next Steps

9. DISCUSSION ITEMS

9.1 (1) Adopt Resolution 2026-111 a Resolution of the City Council of the City of Banning, California, Accepting the Riverside County Registrar of Voters Certificate of Sufficiency for the Referendum Petitions for Ordinance Nos. 1618, 1619, and 1620 Adopted by the City Council on April 14, 2026.
(2) Reconsider and Provide Direction to Repeal Ordinance Nos. 1618, 1619, and 1620. a. Ordinance No. 1618 – amending the city’s zoning map from High Density Residential, Medium Density Residential, Low Density Residential, General Commercial, Open Space – Resources and Open Space – Parks land uses to the Sunset Crossroads Specific Plan that provides for General Commercial, Industrial, Open Space – Parks, and Open Space – Resources land uses.

Recommendation:

Approve Second Reading and Adoption of Ordinance No. 1624 Recommendation: Adopt Resolution 2026-100
Recommendation: Adopt Resolution 2026-105
Recommendation: Adopt Resolution 2026-107
Recommendation: Adopt Resolution 2026-108
Recommendation: Adopt Resolution 2026-109
Recommendation: That City Council discuss and provide input on the status of the City's Emergency Operations Plan and the next steps identified by staff.

City Council - Regular Meeting Agenda
July 14, 2026
3 b. Ordinance No. 1619 – amending the city’s zoning map to change the zoning of 41 acres of a 49.2 acre site within the jurisdiction of the City from Public Facilities School to Very High Density Residential to ensure “no net loss” of the City’s residential development capacity.
c. Ordinance No. 1620 – approving a statutory Development Agreement between the City and NP Banning Industrial (Owner). Under the terms of the Development Agreement and in exchange for vested development rights to develop a master planned project including industrial and commercial uses and various public facilities including parkland and open space, with on and off site related improvements on approximately 533.8 acres of Owners real property located within the City of Banning and the County of Riverside. The Development Agreement requires the Owner to provide fees, facilities, and public benefits subject to the timing and terms of the Development Agreement. (3) If the City Council does not direct the repeal of Ordinances Nos.1618, 1619, and 1620, in their entirety:
a. Adopt Resolution 2026-112, Calling for the holding of a General Municipal Election on November 3, 2026, for the Submission to the Qualified Voters of the City of Banning, Ordinance Nos. 1618, 1619, and 1620; Request the County of Riverside to consolidate said election with the Statewide General Election on November 3, 2026; Request the Board of Supervisors to consent to the Registrar of Voters performing election services for the City of Banning; Setting rules and deadlines for arguments and rebuttals for and against each Ordinance.

9.2 Cannabis Warehouse Moratorium Discussion

9.3 Consideration of a fee waiver request by the Stagecoach Day's Association in the Not to Exceed amount of $38,000

9.4 Update on Utility Billing Recovery Efforts
Recommendation: Adopt Resolution No. 2026- 111, a Resolution of the City Council of the City of Banning, California, Accepting the Riverside County Registrar of Voters Certificate of Sufficiency for the Referendum Petitions for Ordinance Nos. 1618, 1619, and 1620.

Option 1:

Reconsider and provide direction to Repeal Ordinance Nos. 1618, 1619, and 1620 in their entirety.

Option 2:

If the City Council does not provide direction to repeal Ordinances Nos. 1618, 1619, and 1620, in their entirety:

Adopt Resolution 2026-112, Calling for the holding of a General Municipal Election on November 3, 2026, for the Submission to the Qualified Voters of the City of Banning, Ordinance Nos. 1618, 1619, and 1620; Request the County of Riverside to consolidate said election with the Statewide General Election on November 3, 2026; Request the Board of Supervisors to consent to the Registrar of Voters performing election services for the City of Banning; Setting rules and deadlines for arguments and rebuttals for and against each Ordinance.

Recommendation: Staff recommends the City Council discuss and provide direction.

Recommendation: That the City Council review the request and determine if they would like to approve a fee waiver of additional in-kind services for the Annual Stagecoach Day's Event.

Recommendation: Receive an update on the City’s utility billing recovery efforts and provide direction as needed. Staff also recommends temporarily deferring service discontinuance for City Council - Regular Meeting Agenda
July 14, 2026
4 10. ITEMS FOR FUTURE AGENDAS

11. ADJOURNMENT
customers who submitted a payment plan application that remains under review.

11.1 NEW ITEMS

1. Consideration of an automatic rotation for Mayor and Mayor Pro Tem instead of nominations (Barrington) June 2026

11.2 EXISTING ITEMS

1. Emergency Preparedness (Barrington) January 2025

2. Streamline Procurement Policy (Flynn) August 2025

3. Sales Tax Agreement Update with Diamond Chevrolet (Flynn) December 2025

4. Cannabis Warehouse Moratorium (New Facilities Only) (Barrington) December 2025

5. Maintenance and replacement of street signs. (Flynn) March 2026

6. Rename the Arthur Welch Community Center back to the National Guard Armory (Flynn) April 2026

7. Smoke Shop Moratorium (Miller) April 2026

8. Landscape Standards Review (Wallace) May 2026

9. Special Event Fee Schedule and Permit Process Review (Miller) May 2026

10. Review and discussion of the Censure Policy to ensure conformance with the City of Banning Manual of Procedural Guidelines and the Banning Municipal Code (Flynn) June 2026 Next Regular Meeting – August 25, 2026.

Zoom Community Standards for Public Meetings
By participating in this meeting on Zoom, you are agreeing to abide by the City of Banning’s Community Standards for Public Meetings. Zoom attendees that fail to adhere to these standards may be removed from the meeting room.

Your microphone must remain on mute, and you may only unmute your microphone when/if you are recognized by the Mayor.

Your camera must be turned off unless/until you are recognized by the Mayor.

To indicate a desire to make Public Comment, you must use the Raise Hand function. The Mayor will not recognize those who have not used the Raise Hand function.

Public Comment from Zoom attendees will immediately follow in-person comment from members of the public in Council Chambers.

If you fail to adhere to these community guidelines, you may be removed for disrupting the meeting occurring in Council Chambers. You may rejoin the meeting but may be removed for each violation of these community standards.

The chat function will be disabled for all City Council meetings on Zoom.

Estándares comunitarios de Zoom para Reuniones Públicas Al participar en esta reunión en Zoom, usted acepta cumplir con los Estándares Comunitarios para Reuniones Públicas de la ciudad de Banning. Los que atienden por Zoom que no cumplan con estos estándares pueden ser retirados de la sala de reuniones.

Su micrófono debe permanecer en silencio, y solo puede reactivar su micrófono cuando / si es reconocido por el alcalde.

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Para indicar el deseo de hacer un Comentario Público, debe utilizar la función Levantar la mano. El alcalde no reconocerá a quienes no hayan utilizado la función Levantar la mano.

Los comentarios públicos de lo que atienden por Zoom seguirán inmediatamente los comentarios en persona de los miembros del público en las Cámaras del Consejo.

City Council - Regular Meeting Agenda
July 14, 2026
5 Si no cumple con estas pautas de la comunidad, es posible que lo destituyan por interrumpir la reunión que tiene lugar en las Cámaras del Consejo. Puede volver a unirse a la reunión, pero es posible que lo eliminen por cada violación de estos estándares de la comunidad.

La función de chat estará deshabilitada para todas las Reuniones del Ayuntamiento en Zoom.

AFFIDAVIT • DECLARACIÓN JURADA
IT IS HEREBY CERTIFIED under the laws of the State of California that the above agenda was posted on the City's website (www.banningca.gov) as well as the Bulletin Board at Banning City Hall, located at 99 E Ramsey Street, Banning, CA 92220, at least 72 hours in advance of the meeting.
_________________________
Vickie Sellers, Elected City Clerk
Secretaria Municipal Electa
PUBLIC NOTICE • NOTICIA PÚBLICA
Meeting Agendas and Notices
Interested in receiving email and/or text notifications of upcoming City Council meetings? Sign up for meeting notifications through the City's website. Pursuant to amended Government Code §54957.5(b), staff reports and other public records related to open session agenda items are available on the City's website (www.banningca.gov/).

Public Comment
Agenda Items
Any member of the public may address this meeting of the City Council on any item appearing on the agenda. A five-minute limitation shall apply to each member of the public and no member of the public shall be permitted to share their time with any other person.

Non-Agenda Items
Any member of the public may address this meeting of the City Council on any item which does not appear on the regular meeting agenda but is of interest to the general public and is an item upon which the City Council may act. A three-minute limitation shall apply to each member of the public and no member shall be permitted to share their time with any other person. No action shall be taken, nor discussion held by the City Council, on any item which does not appear on the agenda, unless the action is otherwise authorized in accordance with the provisions of subdivision (b) of §54954.2 of the Government Code.

Special Assistance/Accessibility Requests
In compliance with the Americans with Disabilities Act, any member of the public may request that the agenda and agenda packet be mailed to them. If you need special assistance to participate in this meeting (such as translation services), please contact the City Clerk's Office. Advanced notification of at least 48 hours prior to the meeting will allow the city to make arrangements to ensure your accessibility.
¿Necesita servicios de traducción para participar? Contacto Oficina del Secretario de la Ciudad.

CONTACT • CONTACTO
City Clerk's Office | 951-922-3102 | [email protected] 99 East Ramsey Street, Banning, California 92220
City Council - Regular Meeting Agenda
July 14, 2026
6 CITY OF BANNING

STAFF REPORT
TO: CITY COUNCIL
FROM: Elizabeth Gibbs, City Manager
PREPARED BY: Sandra Calderon, Deputy City Clerk
MEETING DATE: July 14, 2026
SUBJECT: Consideration and Approval of the Meeting Minutes of the May 12, 2026, Regular City Council Meeting and the May 14, 2026, Workshop City Council Meetings.

STAFF RECOMMENDATION:

Approve the Meeting Minutes of the May 12, 2026, Regular City Council Meeting and the May 14, 2026, Workshop City Council Meetings.

BACKGROUND:

After every meeting, the City Clerk's Office prepares meeting minutes. The City Council reviews and approves these minutes either as presented or with modifications.

JUSTIFICATION:

These minutes have been prepared as summary minutes in accordance with City Council Resolution 2025-22 and Government Code Section 36814, 4801, and 54953 (c)(2).

FISCAL IMPACT:

None
ATTACHMENTS:

1. 2026 05 12_Regular Meeting_DRAFT.docx

2. 2026 05 14_Workshop_DRAFT.docx
7 MINUTES
CITY COUNCIL – REGULAR MEETING
MAY 12, 2026

1. CALL TO ORDER – 5:01 p.m.

1.1 ROLL CALL
COUNCIL MEMBERS PRESENT: Mayor Richard Royce
Mayor Pro Tem Cindy Barrington
Council Member Sheri Flynn
Council Member Leroy Miller
Council Member Colleen Wallace
COUNCIL MEMBERS ABSENT: None
OTHERS PRESENT: Phaedra Norton, City Attorney
Elizabeth Gibbs, City Manager
Art Vela, Public Works Director
Robert Wright, Parks and Recreation Director
Marisol Lopez, Economic Development Manager
Vickie Sellers, City Clerk
Sandra Calderon, Deputy City Clerk

1.2 INVOCATION
Performed by Council Member Miller

1.3 PLEDGE OF ALLEGIANCE
Mayor Royce led the Pledge of Allegiance.

2. AGENDA APPROVAL

2.1 AGENDA APPROVAL
MOTION
Council Member Miller moved and Mayor Pro Tem Barrington seconded a motion to approve the agenda. The motion carried unanimously.

3. PRESENTATIONS

3.1 Proclamation - Kids to Parks Day 2026
Recommendation: Proclaim May 16, 2026 as National Kids to Parks Day.

Mayor Royce presented the Proclamation to the Banning Parks and Recreation Director. 8 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
2 3.2 Small Business Month – May 2026 Proclamation and Recognition of Black Diamond Event Planning DBA Elegant Affair Wedding Venue
Recommendation: Staff recommends that the City Council:

1. Approve the Small Business Month Proclamation for May 2026; and

2. Receive and file the recognition of Black Diamond Event Planning DBA Elegant Affair Wedding Venue.

Mayor Royce read the Proclamation and presented a Certificate of Recognition to Black Diamond Event Planning DBA Elegant Affair Wedding Venue.

3.3 Proclamation - National Public Works Week (May 17-23) Recommendation: Proclaim May 17 to May 23, 2026 as National Public Works Week Mayor Royce read the Proclamation and recognized Banning Public Works employees in attendance.

4. REPORT ON CLOSED SESSION
Phaedra Norton, City Attorney stated the City Council met in Closed Session and there was no reportable action taken.

5. PUBLIC COMMENTS, CORRESPONDENCE, APPOINTMENTS, AND REPORTS

5.1 PUBLIC COMMENTS
Pat Murkland promoted the Downtown Banning Art Walk. She announced a special event scheduled for May 23, 2026, commemorating the 98th anniversary of the opening of the Banning Theater. She stated the event would feature a film originally shown at the theater in 1928 and invited the community to attend.

Inge Schuler expressed concern that City Council minutes posted on the City's website were not current. She also requested that City Council members provide additional information regarding the events they attend and the relevance of those events to the City of Banning.

Rita Chpparosa, Parks and Recreation Commissioner, commended the Parks and Recreation Department for its work despite limited resources.

Stuart Mackenzie commented on a Closed Session item and questioned why the matter had not yet been resolved. He also questioned whether a new pharmacy would be opening in downtown Banning.

5.2 CORRESPONDENCE
Staff stated no correspondence was received.

5.3 APPOINTMENTS
Parks and Recreation Appointment for Position 1, term ending January 31, 2029 Recommendation: Appoint one applicant to fill vacancy in Position 1 on the Parks and Recreation Commission
The City Council considered the appointment of a member to the Parks and Recreation Commission. Following a roll call of Council Member preferences, Cheryce Cobbs was appointed 9 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
3 by a 3-2 vote, with Council Members Miller, Wallace, and Mayor Royce voting in favor of Cobbs, and Mayor Pro Tem Barrington and Council Member Flynn supporting Monette Hamilton. Mayor Royce thanked both applicants for their willingness to serve.

5.4 CITY COUNCIL COMMITTEE REPORTS
Council Member Wallace reported on her attendance at the Southern California Association of Governments General Assembly. She stated many of the workshops focused on Regional Housing Needs Allocation (RHNA) requirements and efforts by SCAG to assist smaller jurisdictions in meeting their housing obligations. She also attended a workshop on artificial intelligence. Council Member Wallace further reported on a meeting of the Western Riverside County Regional Conservation Authority, where discussions included wildlife and habitat conservation issues, as well as budget-related matters.

Council Member Flynn reported on her attendance at a meeting of the Western Riverside Council of Governments (WRCOG), where the Southern California Association of Governments (SCAG) presented 2050 population, household, and employment projections. She stated the Inland Empire is projected to experience the second-highest household growth and the highest job growth among Southern California regions. She also reviewed regional office vacancy rates, noting that the Inland Empire continues to have one of the lowest office vacancy rates in the region.

Council Member Flynn also reported that she and Mayor Pro Tem Barrington attended an Ad Hoc Animal Shelter Committee meeting with the City Manager, Planning Department, and Police Department to review information that would be presented at the May 14 animal shelter workshop.

Council Member Flynn further reported on activities related to the Sun Lakes Boulevard Extension Project through the Riverside County Transportation Commission, noting that the groundbreaking ceremony for the project was scheduled for May 26.

Mayor Pro Tem Barrington reported on her attendance at the grand reopening of Gus Jr.'s on May 5, noting the restaurant is under new ownership and management.

Mayor Pro Tem Barrington also attended a Blue Zones meeting, where participants discussed priority initiatives they hoped to advance with Council support. She stated she encouraged efforts focused on seniors and reducing children's screen time and noted that related initiatives would be developed.

Mayor Pro Tem Barrington reported that she and Council Member Flynn attended an Ad Hoc Animal Shelter Committee meeting to review information that would be presented at the May 14 animal shelter workshop.

Mayor Pro Tem Barrington thanked Banning Utility for its successful community tree giveaway, noting that the available trees were claimed quickly and expressing appreciation for the program.

Mayor Pro Tem Barrington stated she also attended the May 6 Beaumont Chamber of Commerce breakfast, where the Mayor of Beaumont presented a mini State of the City address. She stated she took note of several ideas that could benefit Banning. She reported that approximately 40 percent of Beaumont's General Fund revenues are generated through sales tax and that public safety expenditures account for approximately half of the City's General Fund and have increased significantly in recent years. She also noted that approximately half of Beaumont's sales tax revenue is generated by visitors from outside the city and encouraged residents to support local businesses by shopping in Banning.

Council Member Miller reported on his attendance at the ribbon cutting for Gus Jr.'s under its new ownership and management. He also attended the Beaumont Chamber of Commerce breakfast 10 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
4 and a Riverside Transit Agency (RTA) Budget and Finance Committee meeting on May 6. He stated that while many RTA issues do not directly affect Banning, the City is served by an RTA bus stop and residents have access to numerous regional transit destinations. Council Member Miller also announced he would be attending the Nonprofit Recognition Awards on May 13.

Mayor Royce reported on recent state legislation related to housing and development and discussed the Regional Housing Needs Allocation (RHNA) process and associated state housing mandates. He stated that many cities have been required to pursue creative approaches to comply with those requirements. Mayor Royce also reported on his involvement with Our Neighborhood Voices, a grassroots organization advocating for local control over land use decisions, including proposed changes to the RHNA process and the authority of the California Coastal Commission.

He invited members of the public to learn more about the organization and its efforts.

5.5 ANNOUNCEMENTS OF CITY COUNCIL MEMBERS
This item was taken out of order following Item 5.8.

Council Member Wallace announced that the Banning Woman's Club Fashion Show would be held on June 13 at 12:00 p.m. She also announced two upcoming Juneteenth celebrations: one at Roosevelt Williams Park on June 19 at 11:00 a.m., where attendees were encouraged to bring chairs and food, and a second event on June 20 at Sylvan Park.

Council Member Miller announced that he would not be holding a Town Hall meeting during the upcoming weekend. He encouraged residents instead to attend the City's Fiscal Sustainability Workshop on May 14.

Mayor Royce echoed Council Member Miller's comments and emphasized the importance of the May 14 Fiscal Sustainability Workshop, stating it was the City's highest priority at that time.

Mayor Pro Tem Barrington clarified comments made by the City Treasurer regarding utility billing.

She stated she had not advised the City Treasurer against discussing utility bills with residents and that she was welcome to.

5.6 CITY TREASURER’S REPORT
Sue Savage, City Treasurer, reported that she recently met with the City Manager and stated the Treasurer's Report would be presented at the second City Council meeting of each month. She stated the meeting was productive and that she had been advised she would receive bank statements and that the Finance Department would work collaboratively with the Treasurer's Office.

She stated she looked forward to those commitments being implemented and to continuing a cooperative working relationship.

City Treasurer Savage also stated she had received questions from residents regarding utility billing statements. She stated she had been advised that assisting with utility billing was not within the Treasurer's responsibilities; however, members of the public continued to seek her assistance.

She questioned the City's transition back to its previous utility billing system after implementation of a newer system and whether the issues that prompted the change had been resolved. She stated she would continue assisting residents in reviewing their utility billing statements when requested and expressed her desire to work collaboratively with the City Manager and Finance Director to move the City forward.

5.7 CITY MANAGER'S REPORT
In response to Mayor Royce, City Manager Gibbs stated the City had engaged a retired City Clerk to assist with bringing City Council minutes current over the coming months. She stated completed 11 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
5 minutes would be presented to the City Council for approval as they become available.

City Manager Gibbs also clarified that an error had occurred regarding the utility billing grace period. She stated two utility bills had been issued in March and that the City Council had previously approved a three-month grace period. She clarified that the grace period would expire at the end of June.

In response to comments from the City Treasurer, City Manager Gibbs confirmed they had recently met and agreed that the Treasurer's Report would be presented at the second City Council meeting of each month. She stated future agendas would reflect that schedule.

City Manager Gibbs announced a Utility Assistance Clinic to be held on May 20 from 9:00 a.m. to 2:00 p.m. in the Council Chambers for residents seeking financial assistance with utility bills. She also announced that the Fifth District County Supervisor's Office would be hosting a free produce distribution on May 14 beginning at 9:30 a.m. and encouraged residents to register in advance, if possible, to assist with planning.

City Manager Gibbs introduced Acting Police Captain Smith to provide an update on the City's new false alarm management program.

Acting Police Captain Smith discussed implementation of the City's new false alarm management program through PMAM. He stated the system had gone live that day following staff training and was currently in a soft launch to ensure proper functionality. He stated alarm permits were once again being accepted and that a public portal would be available through the City's website. He also discussed community outreach efforts, including public education regarding alarm permits and false alarm fees, and explained that the Police and Fire Departments would utilize the system to administer the program.

In response to Mayor Royce, Acting Police Captain Smith stated the permit fee cycle would reset every three years based on the anniversary of the permit. He also discussed permit requirements, circumstances under which false alarm fees would apply, and reporting capabilities available through the PMAM system.

Council Member Miller commended Acting Police Captain Smith and staff on implementation of the program and stated he was pleased to see it moving forward.

City Manager Gibbs reminded the public of the upcoming Workout Plan to Sustainability Workshop scheduled for May 14 at 4:00 p.m. She encouraged residents to attend in person or participate remotely and stated the workshop would provide an overview of the City's current financial condition.

5.8 CITY ATTORNEY'S REPORT
Phaedra Norton, City Attorney, read portions of the Rules of Decorum and Procedural Guidelines for the City of Banning.

6. CONSENT ITEMS

6.1 Consideration and Approval of the meeting minutes of the February 22, 2025 Special City City Council meeting (Workshop).

Recommendation: Approve the meeting minutes of the February 22, 2025 Special City Council meeting (Workshop).

6.2 Public Works Capital Improvement Project Tracking List Recommendation: Receive and file
12 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
6 6.3 Accept as Complete Various Improvements Related to the Atwell Specific Plan Development and Authorize a 90% Reduction in the Improvements Bonds and Exoneration of Monumentation Bonds Recommendation: City Council accept as complete various improvements related to the Atwell Specific Plan Development and authorize a 90% reduction in the improvements bonds and exoneration of Monumentation Bonds.

6.4 Parks and Recreation of Monthly Activities through the 3 rd Quarter of Fiscal Year 2025/2026 –
March 2026
Recommendation: Receive and file.

6.5 Consideration of Resolution 2026-15, Approving and Adopting the City of Banning Electric Utility’s Electric System Master Plan
Recommendation: Adopt Resolution 2026-15.

6.6 Consideration of Resolution 2026-73, Amendment to the Professional Services Agreement with Rogers, Anderson, Malody & Scott LLP (RAMS) Providing Oversight Accounting Services and Staff Augmentation to the City’s Finance Department
Recommendation: Adopt Resolution 2026-73.

Frank Connolly addressed Item 6.6. and questioned when the Finance Department would no longer need consultants.

In response to Mayor Royce, City Manager Gibbs stated she was very cognizant of not spending more than was necessary and also announced that two critical positions in the Finance Department were just recently filled. She stated the City’s books were still in bad shape and the consultants were working to bring those up to date. She explained the tasks RAMS was helping with and stated she hoped the staff augmentation would not be needed by end of summer.

MOTION
Council Member Wallace moved and Council Member Miller seconded a motion to approve the agenda. The motion carried unanimously.

RECESS
At 6:05 p.m., the City Council recessed. The meeting reconvened at 6:23 p.m. with all Council Members present.

7. PUBLIC HEARINGS
None.

8. REPORTS OF OFFICERS

9. DISCUSSION ITEMS

9.1 Consideration of a Fee Waiver Request Not-to-Exceed $12,960 for Stagecoach Days Associations Barrels, Brews, and Bites Event Scheduled for May 15-16, 2026 Recommendation: Approve the Fee Waiver of no more than $12,960.

Ralph Wright, Parks and Recreation Director, presented the staff report. He stated the requested fee waiver pertained to the cost of required Police Department staffing for the event. He explained that although police presence had traditionally been required for events serving alcohol, the City had recently adopted a Master Fee Schedule requiring event organizers to reimburse those costs. 13 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
7 He stated this was the first event subject to the new fee and that the Stagecoach Days Association had requested a waiver because the additional expense had not been anticipated. He noted the City's fee waiver policy required City Council approval.

In response to Council Member Miller, Mr. Wright stated the Stagecoach Days Association submitted its fee waiver request approximately one week earlier after learning of the new fees. He explained the fees were included in the updated application materials but had only recently taken effect under the newly adopted Master Fee Schedule.

Amy Pippinger, representing the Stagecoach Days Association, stated the organization was notified of the new fees approximately two weeks earlier and had not budgeted for the additional expense. She explained the Association already contracted private security and was unaware that Police Department staffing would also be required, resulting in an unexpected increase in event costs.

MOTION
Mayor Pro Tem Barrington moved and Mayor Royce seconded a motion to approve the fee waiver.

The motion carried unanimously.

9.2 Consideration of Resolution 2026-44, Reprogramming Approved Community Development Block Grant (CDBG) Funds in the Amount of $43,144 from FY 2024-25 – Banning Senior Center ADA Improvement Project to CDBG FY 2025-26 – Banning Senior Center ADA Improvement Project #2 ($148,144)
Recommendation: Adopt Resolution 2026-44
Robert Wright, Parks and Recreation Director, presented the staff report. He reviewed the history of the item, noting that it had been continued from the April meeting to allow staff to explore potential funding opportunities for the Senior Center through the Riverside County Supervisor's Office. He stated County staff were evaluating available funding sources and believed they may be able to provide partial assistance, although sufficient funding to complete the project had not yet been identified.

Mr. Wright explained that County staff had identified three options for the remaining Community Development Block Grant (CDBG) funds: extend the existing project for one year, reprogram the funds to the Senior Center roof replacement project, or cancel the current Dysart Park project and reserve the funding for a future Dysart Park application following approval of the County's updated funding plan. Staff recommended reprogramming the funds to the Senior Center project while preserving the opportunity to seek future funding for Dysart Park improvements. He also noted a correction to the proposed resolution regarding the funding amount. Mr. Wright also noted a correction to the proposed resolution, stating that the funding amounts should be listed as $43,144 and a total of $141,828 in the final parenthetical reference.

Council Members discussed the proposed reprogramming of the CDBG funds, the timing of future funding cycles, and the availability of additional grant opportunities. Questions were raised regarding the original scope of the Dysart Park project, including whether the approved funding had been intended solely for replacement of the bleachers or for a broader scope of improvements.

Council Member Flynn requested that staff provide the original CDBG application and supporting documentation for Council review. City Manager Gibbs stated the information would be provided when the future application was brought forward.

Council Members also discussed the relationship between the Senior Center project and future Dysart Park improvements. Mr. Wright clarified that the proposed action would not eliminate future funding opportunities for Dysart Park but would require submission of a new application during a 14 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
8 future funding cycle. He also noted that additional CDBG funds may become available for reprogramming upon completion of the Lions Park project.

Frank Connolly stated he believed the original intent of the Dysart Park funding had been to purchase bleachers and encouraged the City to clarify the original project scope. He also encouraged the City to continue pursuing additional County funding for the Senior Center project.

Edward Espinosa questioned why repairs to the Senior Center roof had not been completed years earlier and expressed concern regarding costs associated with the Dysart Park project. He encouraged the City to prioritize needed facility improvements.

Mayor Royce stated he believed staff's recommended option to reprogram the funds to the Senior Center project while reserving future funding opportunities for Dysart Park was the most appropriate course of action. Mr. Wright agreed and stated the recommended action included adoption of the reprogramming resolution and authorization to submit the required request to reserve funding for a future Dysart Park project.

MOTION
Council Member Wallace moved and Council Member Miller seconded a motion to adopt Resolution 2026-44, as amended. The motion carried unanimously.

9.3 Make a Determination of Exemption Under the California Environmental Quality Act and Consideration of Resolution 2026-69, Establishing Fiscal Year 2026/2027 Rates for Residential and Commercial Garbage, Recyclable, and Organic Waste Collection Recommendation: Adopt Resolution 2026-69
Art Vela, Public Works Director, presented the staff report. He provided background on the City's solid waste franchise agreement with Waste Management, which was approved in 2021 to ensure compliance with state solid waste requirements. He stated the City subsequently completed Proposition 218 proceedings to establish and update the associated rate structure. He explained that, under the franchise agreement, annual rate adjustments are authorized through July 1, 2027, based on a prescribed methodology. Mr. Vela reviewed the methodology used to calculate the proposed Fiscal Year 2026-27 rate adjustment, including Consumer Price Index (CPI) increases, adjustments related to Senate Bill 1383 implementation, and disposal, recycling, and organic waste processing costs. He stated the proposed monthly residential rate would increase from $31.62 to $32.64 and noted that Banning's rates remain generally comparable to neighboring communities.

He stated the proposed resolution would maintain compliance with the franchise agreement, applicable state regulations, and existing service levels.

In response to Mayor Pro Tem Barrington, Mr. Vela discussed rate calculations for customers with additional refuse containers and referred to the rate schedule included in the agenda packet.

Mayor Pro Tem Barrington and Mayor Royce expressed concerns regarding Waste Management's enforcement of overfilled container requirements and notices issued when container lids remain open. They questioned whether the current enforcement approach was overly restrictive and discussed situations in which wind may cause container lids to open or containers to tip over.

Representatives of Waste Management explained that closed container lids are required for safety during collection operations and to comply with state regulations, including Senate Bill 1383 contamination and diversion requirements. They stated overloaded containers can create safety hazards, increase litter, and affect compliance with CalRecycle's diversion goals. Waste Management representatives also discussed proper use of color-coded containers and noted that previous delays in container availability had primarily occurred during the COVID-19 pandemic.

Frank Connolly expressed concerns regarding solid waste service and costs for homeowners 15 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
9 associations. He requested additional community refuse containers, questioned charges for unused containers, and requested additional information regarding applicable state requirements.

Edward Espinosa expressed concerns regarding wind conditions affecting refuse containers, cleanup of refuse that escapes from containers, and the availability of replacement color-coded containers.

Laura Linedinger stated Waste Management had been responsive in resolving the few service issues she had experienced and expressed support for the company's customer service.

The City Council continued its discussion regarding container requirements, collection practices, and implementation of the franchise agreement with Waste Management.

MOTION
Council Member Flynn moved and Council Member Miller seconded a motion to adopt Resolution 2026-69. The motion carried unanimously.

9.4 Make a Determination of Exemption Under the California Environmental Quality Act and Consideration of Resolution 2026-70, Receiving a Report in Connection with the Proposed Collection on the 2026-27 Riverside County Property Tax Roll of Delinquent Solid Waste Service Charges for Single-Family and Multi-Family Accounts for Calendar Year 2025, Setting a Public Hearing on the Report
Recommendation: Adopt Resolution 2026-70
Art Vela, Public Works Director, presented the staff report. He stated the item was a continuation of the previous discussion and represented an annual process required under the City's franchise agreement. He explained that when the franchise agreement was approved, the City negotiated the ability to place delinquent residential solid waste accounts on the County tax roll. He stated that after an account became 90 days delinquent, notices were mailed to both tenants and property owners, where applicable. He reported that there were currently 968 delinquent accounts totaling $360,135, including service charges, late fees, and the 10 percent tax roll administrative fee. He stated a public hearing was required before the delinquent accounts could be placed on the tax roll and noted that the hearing was scheduled for June 23, 2026. He further explained that property owners would have approximately one month following the public hearing to pay outstanding balances before the accounts were submitted to the County for placement on the tax roll.

In response to Mayor Royce, Mr. Vela explained there had been clerical errors in the original calculations and confirmed that the revised figures presented to the City Council were accurate.

In response to Council Member Miller, Mr. Vela clarified that the report pertained only to residential accounts and stated that delinquent commercial accounts were written off rather than placed on the tax roll.

In response to Mayor Pro Tem Barrington, Mr. Vela explained that, if approved following the public hearing, staff would transmit the resolution and delinquent account list to the County for placement on the tax roll.

Frank Connolly suggested the City consider a similar process for delinquent water and electric utility accounts.

MOTION
Council Member Flynn moved and Council Member Wallace seconded a motion to adopt Resolution 2026-70. The motion carried unanimously.

9.5 Lamar Billboard – Agreement Overview and Selection of City Advertisement Rendering 16 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
10 Recommendation: Receive and file the overview of the Lamar billboard Agreement and provide staff with direction by selecting a preferred advertisement rendering (Attachment A, B, or C) for display on the City of Banning Lamar billboard. Additionally, provide any desired feedback or modifications to the selected design. Upon City Council selection, staff will: 1) finalize the selected design incorporating any Council feedback; 2) coordinate with Lamar Advertising for production and installation; and 3) schedule the advertisement update in accordance with the agreement’s annual no-cost change provision.

Marisol Lopez, Economic Development Manager, presented the staff report. She stated the City obtained exclusive rights to the billboard through a land use agreement in 2021, allowing the City continuous use of the billboard for economic development and tourism promotion. She reviewed the benefits of the agreement and stated the Economic Development Committee had previously met to discuss updated branding concepts and billboard designs. She then presented the proposed billboard design options for City Council consideration.

The City Council discussed the proposed billboard designs and provided feedback regarding various design elements and branding concepts.

Frank Connolly stated the proposed designs were too simple and did not effectively promote the City. He expressed concern that the branding did not adequately reflect Banning's identity and discussed elements of each design. He stated he preferred Design E.

Edward Espinosa stated he preferred Design A and suggested incorporating a stagecoach or another element reflecting Banning's history.

Mayor Royce stated he agreed with Mr. Espinosa's comments. He stated he preferred Designs A and E, but favored Design A with modifications.

Mayor Pro Tem Barrington stated she preferred Design E with modifications and suggested replacing the houses with mountains.

Council Member Flynn discussed the proposed designs and stated she supported Design A.

Council Member Miller stated he preferred Design A.

Following additional discussion, the City Council provided direction to incorporate the suggested modifications into the preferred billboard design.

MOTION
In response to City Manager Gibbs, Mayor Royce moved to table this item. Mayor Pro Tem Barrington seconded the motion. The motion carried 4-1, Council Member Flynn dissenting.

9.6 Discussion and Direction to Staff on a Draft Social Media Policy Recommendation: Discuss the draft social media policy as presented and provide direction to staff on any changes to the policy.

Elizabeth Gibbs, City Manager, presented the staff report and reviewed the proposed Social Media Policy.

Council Member Flynn stated she supported adopting a social media policy but expressed concern that portions of the proposed policy were overly broad and could affect free speech rights.

In response to Council Member Flynn, Assistant City Attorney Norton stated staff would evaluate comments under the proposed policy using a reasonable person standard to determine whether content was defamatory, slanderous, or otherwise violated the policy, and would take appropriate 17 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
11 action when warranted. She stated the policy was intended to ensure compliance with the Brown Act.

In response to Mayor Royce, Assistant City Attorney Norton stated staff could revise the proposed language to provide additional clarity.

Edward Espinosa commented on the Brown Act and its relationship to social media. He suggested disabling comments on the City's social media platforms to avoid potential legal issues. He also expressed concern that former City Council members continued to display the City's logo and official titles on their personal social media accounts.

The City Council discussed the City's social media presence, including promoting a positive image of the community, limiting social media to informational posts, and the potential use of disabled comments. Council Members also discussed alternative methods for residents to communicate with elected officials, including attending public meetings and contacting Council Members directly.

Assistant City Attorney Norton stated disabling comments could expose the City to potential First Amendment liability because restricting public viewpoints on a government social media page may constitute impermissible viewpoint discrimination.

In response to Council Member Miller, City Manager Gibbs recommended that the item be continued to a future workshop to allow staff and the City Attorney's Office to conduct additional research and address the questions raised by the City Council. By consensus, the City Council directed staff to return the item at a future workshop.

10. ITEMS FOR FUTURE AGENDAS

11.1 NEW ITEMS

1. Rename the Arthur Welch Community Center back to the National Guard Armory (Flynn) April 2026

2. Smoke Shop Moratorium (Miller) April 2026

11.2 EXISTING ITEMS

1. Emergency Preparedness (Barrington) January 2025

2. Streamline Procurement Policy (Flynn) August 2025

3. Sales Tax Agreement Update with Diamond Chevrolet (Flynn) December 2025

4. Cannabis Warehouse Moratorium (New Facilities Only) (Barrington) December 2025

5. Continue Food Truck Festival (Barrington) January 2026

6. Maintenance and replacement of street signs. (Flynn) March 2026 Council Member Wallace asked for a future item to review of the Municipal Code regarding code enforcement related to trees.

Council Member Miller requested an item to review the Fee Schedule, specifically related to special events.

11. ADJOURNMENT
MOTION
Council Member Wallace motioned to adjourn, seconded by Council Member Miller. The motion carried unanimously.

The meeting adjourned at 8:29 p.m.
18 City of Banning
City Council Minutes
May 12, 2026 Regular Meeting
12 Minutes prepared by:

Sandra B. Calderon
Deputy City Clerk
These minutes have been prepared as Summary Minutes in accordance with City Council Resolution 2025-22 and Government Code Sections 36814, 40801, and 54953(c)(2).

The entire discussion of this meeting may be viewed here:
https://banningca.granicus.com/player/clip/316?view_id=1&redirect=true 19 MINUTES
CITY COUNCIL – SPECIAL MEETING (WORKSHOP)
MAY 14, 2026

1. CALL TO ORDER – 4:00 p.m.

COUNCIL MEMBERS PRESENT: Mayor Richard Royce
Mayor Pro Tem Cindy Barrington
Council Member Sheri Flynn
Council Member Leroy Miller
Council Member Colleen Wallace
COUNCIL MEMBERS ABSENT: None
OTHERS PRESENT: Phaedra Norton, Assistant City Attorney Elizabeth Gibbs, City Manager
Art Vela, Public Works Director
Vickie Sellers, City Clerk
Sandra Calderon, Deputy City Clerk

2. PUBLIC COMMENTS
Susan Savalinin stated workforce development was missing from the proposed plan. She stated the City should diversify its economic development efforts rather than focus on a single industry. She also suggested increased traffic enforcement as a potential source of additional revenue for the City.

3. WORKSHOP

3.1 Banning’s Workout Plan to Sustainability
Recommendation:
(1) Formally acknowledge the financial status update presented in this report; and (2) Provide direction to staff on the revenue and expenditure options outlined in Milestone 5; and
(3) Direct staff to return in June with a proposed budget for the City's next fiscal year (July 2026 through June 2027), incorporating Council guidance from this workshop.

Elizabeth Gibbs, City Manager, presented the staff report regarding the City's financial outlook. She stated the City was facing significant financial challenges and that staff would present the current fiscal condition, factors contributing to the situation, and potential strategies for recovery. She stated the presentation would include an overview of projected finances and that staff would seek City Council direction regarding future budget development. Ms. Gibbs introduced Jim Morris, financial forecast consultant. She explained that the forecast began with a baseline scenario reflecting the City's current financial trajectory absent corrective action and stated the baseline forecast indicated significant fiscal concerns.

Jim Morris, Urban Futures, financial advisor to the City of Banning, presented the fiscal outlook and discussed the forecasting methodology used in the analysis. He stated the forecast was based on 20 City of Banning
City Council Minutes
May 14, 2026 Special Meeting – Workshop
2 the City's ten-year financial history, regional economic data, and revenue and expenditure trends. He noted that long-range forecasts are inherently conservative due to the uncertainty associated with future economic conditions.

Mr. Morris explained that the baseline forecast assumes current spending and revenue patterns continue over a ten-year period and serves as a starting point for evaluating future policy decisions.

He stated that City Council direction would be incorporated into future scenario forecasts for comparison against the baseline.

Mr. Morris reviewed the baseline financial projections and discussed the City's structural deficit, noting that expenditures have exceeded revenues for several years and that fund balance levels have declined. He stated the City would need to identify opportunities to close the gap between revenues and expenditures and indicated that potential solutions would be discussed later in the presentation.

In response to Council Member Flynn, Mr. Morris stated that the forecast included General Fund expenditures such as salaries, operating costs, and debt service obligations, but did not include enterprise funds.

In response to Council Member Wallace, Mr. Morris discussed the City's CalPERS obligations and stated the City's retirement system was relatively well funded compared to many other jurisdictions.

In response to a member of the public, Mr. Morris discussed previous clients that had faced similar fiscal challenges. He stated that earlier identification of structural financial issues provides greater flexibility in addressing them and noted that timely decision-making would be important moving forward. He stated the City had viable options available to address the projected deficit and discussed examples of how financial forecasting tools can be used to evaluate policy decisions and achieve long-term fiscal stability.

Mike Bush, financial consultant for the City, discussed his experience assisting other agencies through fiscal recovery efforts. He stated that addressing structural deficits often requires evaluating workforce levels, revenue opportunities, and service delivery models. He noted that when fiscal gaps are significant, incremental reductions alone may not be sufficient and broader operational adjustments may need to be considered. He emphasized the importance of providing the City Council with sufficient time and information to make informed policy decisions. He stated he generally did not support across-the-board reductions, as such cuts can disproportionately affect departmental operations, and noted that implementation of fiscal solutions often requires a targeted approach. He stated some decisions would be relatively straightforward while others would be more difficult.

Ms. Gibbs discussed the City's decision to conduct an open and transparent process regarding its fiscal challenges. She stated that City services belong to the residents and that public involvement was an important component of the process. She reviewed the recently adopted Strategic Plan, Banning 2030, and specifically Initiative 4A, "Banning's Workout Plan to Fiscal Sustainability." Ms. Gibbs outlined the five milestones of the initiative, including: (1) completing the City's financial records for Fiscal Year 2024-25 to establish an accurate financial position; (2) reconciling Fiscal Year 2025-26 activity and developing year-end estimates; (3) updating and adopting Fiscal Management Policies; (4) completing a ten-year fiscal forecast and establishing budget guidance; and (5) evaluating options to eliminate structural deficits and restore fund balances. She discussed each milestone and the City’s budget and financial situation in greater detail.

Sue Savage, Banning's elected City Treasurer, stated she had previously warned City officials that 21 City of Banning
City Council Minutes
May 14, 2026 Special Meeting – Workshop
3 current spending levels were not sustainable. She stated that shortly after raising those concerns, she lost access to her office and was limited in her ability to communicate with the public regarding financial matters. She questioned whether her concerns had been inaccurate or simply unwelcome.

She stated the City continued to face significant fiscal challenges and questioned whether the Council was prepared to take the actions necessary to address them. She acknowledged recent efforts to reduce spending but stated expenditures continued to exceed revenues. She also stated the City Treasurer's Office could assist with investment strategies and other financial tools, provided there was a willingness to collaborate.

Frank Connolly stated that policies were already in place to address many of the City's financial issues but had not been consistently followed by previous staff. He emphasized the importance of adhering to adopted policies and stated that policies should be meaningfully implemented if they are to be effective.

Mayor Royce thanked both speakers for their comments and stated he agreed with their observations. He stated he looked forward to the Council taking the matter seriously and adhering to the adopted budget in the upcoming fiscal year.

Ms. Gibbs discussed the City's two primary fiscal challenges: restoring depleted fund balances and addressing the ongoing structural deficit. She stated that both issues required action but would require different solutions.

Ms. Gibbs reviewed potential one-time funding sources available to restore fund balance, including the sale of surplus City-owned properties, potential revenues associated with the Sunset Crossroads development agreement, and options related to existing utility lease agreements. She noted that onetime revenues could be used to stabilize reserves but would not address ongoing operating deficits.

She then discussed potential long-term solutions to address the structural deficit, including a local sales tax measure, economic development initiatives, and continued growth of the City's commercial and industrial tax base. She reviewed timelines and requirements associated with a potential sales tax measure and discussed efforts to promote economic development, including opportunities at the Banning Municipal Airport.

Ms. Gibbs outlined a proposed three-phase approach consisting of: (1) stabilization through expenditure reductions, accounting improvements, and restoration of financial controls; (2) structural alignment of ongoing revenues and expenditures through forecasting and fiscal discipline; and (3) long-term sustainability through economic development, restoration of reserves, and potential voterapproved revenue measures.

Ms. Gibbs stated the City already operates with limited service levels and that expenditure reductions alone would not be sufficient to eliminate the structural deficit. She also discussed municipal bankruptcy, explaining why staff did not believe it was an appropriate solution for the City's circumstances.

Ms. Gibbs concluded by outlining next steps, including finalization of the proposed budget, implementation of updated fiscal management policies, evaluation of service reductions, and initiation of community outreach related to potential future revenue measures. She reiterated the actions being requested of the City Council as part of the workshop.

In response to Council Member Miller, Art Vela, Public Works Director, discussed the five City-owned properties that could potentially be declared surplus and sold.

In response to Mayor Royce, Mr. Vela stated staff could evaluate the financial implications of leasing 22 City of Banning
City Council Minutes
May 14, 2026 Special Meeting – Workshop
4 the properties versus selling them outright.

In response to Council Member Wallace, Mr. Vela stated staff could explore opportunities to connect business owners with developers interested in investing in Banning.

In response to Council Member Flynn, Ms. Gibbs stated it would likely take approximately one year from groundbreaking to opening of a Sam's Club at the Sunset Crossroads shopping center, after which sales tax revenues would begin to be received. She stated an additional year or more would likely be required for planning, entitlement, and approval processes prior to construction.

In response to a public speaker, Mr. Vela discussed a recent condominium development and stated the project would generate ongoing property tax revenues but limited recurring revenues beyond that. He stated one-time revenues associated with the project would primarily consist of development and permit fees.

In response to Council Member Flynn, Mr. Vela stated he was uncertain why City-owned properties had not been declared surplus and sold in the past. He stated it was his understanding that one reason was to maintain control over future development of the properties and noted that would be an important consideration moving forward.

In response to Mayor Royce, Mr. Vela stated the properties had not been actively marketed for sale, with the exception of 150 Ramsey Street.

Mayor Pro Tem Barrington stated that the last City-owned property sold by the City was sold below its appraised value.

Council Members expressed general consensus in support of exploring a potential sales tax measure for the November 2027 ballot and evaluating City-owned properties for potential sale.

In response to questions from the City Council, Mr. Bush discussed the advantages and disadvantages of leasing versus selling City-owned property. He stated that developers often prefer to purchase property outright rather than lease it, particularly when substantial capital improvements are required. He noted that developers may offer less than market value when significant site improvements are necessary, but that long-term sales tax revenues generated by development may offset any reduction in the initial sale price. He also stated that some available parcels may need to be assembled with adjacent properties to support larger development projects and encouraged the City Council to maintain realistic expectations regarding development opportunities.

Council Member Flynn stated she agreed with Mayor Pro Tem Barrington that undeveloped Cityowned properties should be sold rather than leased. She also stated that development-related conditions could potentially be included as part of the sale process.

In response to City Manager Gibbs, Mayor Royce stated he did not believe accelerating utility lease payments was in the City's best interest at this time. Following additional discussion and clarification from staff, the City Council expressed interest in further analyzing the option.

Council Member Flynn discussed the City's utility system and stated the City should consider evaluating the potential sale of utility assets to Southern California Edison.

In response to City Manager Gibbs, Council Members expressed interest in exploring the use of Community Facilities Districts in connection with future development projects. 23 City of Banning
City Council Minutes
May 14, 2026 Special Meeting – Workshop
5 The City Council discussed personnel costs, service levels, and potential expenditure reductions.

Mayor Royce stated the City should conduct a comprehensive review of departmental structures, staffing levels, operating expenses, and service delivery. He emphasized the importance of prioritizing core governmental functions and basic services before enhanced services.

Council Member Flynn acknowledged that reductions to enhanced services would be difficult but stated temporary reductions may need to be considered as part of the City's fiscal recovery efforts.

Mayor Pro Tem Barrington and Council Member Wallace requested additional information regarding the costs associated with enhanced services before making decisions regarding potential reductions.

Council Member Wallace expressed concern regarding the impact service reductions could have on staffing levels and public safety operations.

Mayor Pro Tem Barrington stated the Council should rely on recommendations from department directors regarding staffing and service levels, noting that reductions should be carefully evaluated to avoid unintended operational impacts.

Mayor Royce discussed additional cost-saving measures that could be explored, including temporary furloughs, contract and benefit negotiations, and other personnel-related adjustments. He stated the City was currently in a period of fiscal triage and would need to focus on achieving alignment between revenues and expenditures.

Mayor Pro Tem Barrington suggested that programs could be designed to be cost-neutral versus cut completely.

Council Member Miller suggested that the City look into in-kind services as a potential place to cut costs or increase revenue.

4. ADJOURNMENT
MOTION
Council Member Wallace motioned to adjourn, seconded by Council Member Miller.

The question was called and the motion carried unanimously.

The meeting adjourned at 6:08 p.m.

Minutes prepared by:

Sandra B. Calderon
Deputy City Clerk
These minutes have been prepared as Summary Minutes in accordance with City Council Resolution 2025-22 and Government Code Sections 36814, 40801, and 54953(c)(2).

The entire discussion of this meeting may be viewed here:
https://banningca.granicus.com/player/clip/316?view_id=1&redirect=true 24 CITY OF BANNING

STAFF REPORT
TO: CITY COUNCIL
FROM: Elizabeth Gibbs, City Manager
PREPARED BY: Sandra Calderon, Deputy City Clerk
MEETING DATE: July 14, 2026
SUBJECT: Approval of City Attorney Invoices for the Month of June 2026 STAFF RECOMMENDATION:

Approve the attorney invoices for June 2026 as presented in the amount of $118,090.68 BACKGROUND:

Invoices cover legal services provided to the City during June 2026 and are submitted for Council approval.

JUSTIFICATION:

The invoices reflect legal services provide to the City during June 2026. Approval is necessary to ensure timely payment for contracted legal services.

FISCAL IMPACT:

Funds are available within the City's adopted budget for legal services.

ATTACHMENTS:

1. Banning Statements-June 2026_Redacted.pdf
25 SLOVAK BARON EMPEY MURPHY & PINKNEY LLP
www.sbemp.com
74774 Highway 111
Indian Wells, CA 92210
Fed. ID #33-0833010
Telephone 760-322-2275
July 2, 2026
City of Banning

E-MAIL INVOICES
Our file no:

Professional services through: 6/30/2026: Invoice # 101621 Amount
BALANCE DUE – PLEASE SUBMIT PAYMENT: $328.60
26 SLOVAK BARON EMPEY MURPHY & PINKNEY LLP
www.sbemp.com
74774 Highway 111
Indian Wells, CA 92210
Fed. ID #33-0833010
Telephone 760-322-2275
July 2, 2026
City of Banning

E-MAIL INVOICES
Our file no:

Professional services through: 6/30/2026: Invoice # 101622 Amount
BALANCE DUE – PLEASE SUBMIT PAYMENT: $1,713.58
27 SLOVAK BARON EMPEY MURPHY & PINKNEY LLP
www.sbemp.com
74774 Highway 111
Indian Wells, CA 92210
Fed. ID #33-0833010
Telephone 760-322-2275
July 2, 2026
City of Banning

E-MAIL INVOICES
Our file no:

Professional services through: 6/30/2026: Invoice # 101623 Amount
BALANCE DUE – PLEASE SUBMIT PAYMENT: $ 5,852.90
28 SLOVAK BARON EMPEY MURPHY & PINKNEY LLP
www.sbemp.com
74774 Highway 111
Indian Wells, CA 92210
Fed. ID #33-0833010
Telephone 760-322-2275
July 2, 2026
City of Banning

E-MAIL INVOICES
Our file no:

Professional services through: 6/30/2026: Invoice # 101624 Amount
BALANCE DUE – PLEASE SUBMIT PAYMENT: $ 15,995.00
29 SLOVAK BARON EMPEY MURPHY & PINKNEY LLP
www.sbemp.com
74774 Highway 111
Indian Wells, CA 92210
Fed. ID #33-0833010
Telephone 760-322-2275
July 2, 2026
City of Banning

E-MAIL INVOICES
Our file no:

Professional services through: 6/30/2026: Invoice # 101625 Amount
BALANCE DUE – PLEASE SUBMIT PAYMENT: $ 30.80
30 SLOVAK BARON EMPEY MURPHY & PINKNEY LLP
www.sbemp.com
74774 Highway 111
Indian Wells, CA 92210
Fed. ID #33-0833010
Telephone 760-322-2275
July 2, 2026
City of Banning

E-MAIL INVOICES
Our file no:

Professional services through: 6/30/2026: Invoice # 101626 Amount
BALANCE DUE – PLEASE SUBMIT PAYMENT: $ 939.40
31 SLOVAK BARON EMPEY MURPHY & PINKNEY LLP
www.sbemp.com
74774 Highway 111
Indian Wells, CA 92210
Fed. ID #33-0833010
Telephone 760-322-2275
July 2, 2026
City of Banning

E-MAIL INVOICES
Our file no:

Professional services through: 6/30/2026: Invoice # 101627 Amount
BALANCE DUE – PLEASE SUBMIT PAYMENT: $ 87,103.80
32 SLOVAK BARON EMPEY MURPHY & PINKNEY LLP
www.sbemp.com
74774 Highway 111
Indian Wells, CA 92210
Fed. ID #33-0833010
Telephone 760-322-2275
July 2, 2026
City of Banning

E-MAIL INVOICES
Our file no:

Professional services through: 6/30/2026: Invoice # 101628 Amount
BALANCE DUE – PLEASE SUBMIT PAYMENT: $ 6,126.60
33 CITY OF BANNING

STAFF REPORT
TO: CITY COUNCIL
FROM: Elizabeth Gibbs, City Manager
PREPARED BY: Patrick Safari, Capital Improvement Projects Manager Art Vela, Director of Public Works
MEETING DATE: July 14, 2026
SUBJECT: Authorize the City Manager to sign the Notice of Completion for “Banning Boy Scouts Club Building Environmental Clean-Up, Abatement, and Demolition Project” as complete and direct the City Clerk to record the Notice of Completion.

STAFF RECOMMENDATION:

Authorize execution of the Notice of Completion.

BACKGROUND:

On May 9, 2025, the Riverside County Fire Department received multiple calls about a structure fire at Repplier Park. The facility, formerly the Banning Boy Scouts Club, sustained major damage. Firefighters managed to contain the flames within approximately one hour.

On August 26, 2025, City Council adopted Resolution 2025-122, awarding a Sole Source Agreement to ATI Restoration, LLC for “Banning Boy Scout Building Environmental Clean-Up, Abatement, and Demolition Project” in the amount of $494,500.

On May 12, 2026, a change order to the contract agreement with ATI Restoration, LLC (“Amendment No.1”) was approved in the amount of $23,331.47 for out-of-scope work including the removal of hazardous sidewalk; and additional asbestos testing and remediation beyond the original scope of work.

Amendment No.1 increased the contract amount to $517,831.47.

The principal items of work included asbestos testing and removal; hazardous material handling; building demolition; and site restoration.

JUSTIFICATION:

ATI Restoration, LLC was awarded the contract, and work was completed on November 17, 2025. Public Works staff verified through inspections that the workmanship and procedures were satisfactory, and that the contract had met the required contract obligations.

FISCAL IMPACT:

The insurance coverage for the building provided a payment of $741,480 to the City of Banning. The funds were used to cover the total cost of $517,831.47 for the environmental clean-up, abatement, and building demolition.

ATTACHMENTS:

1. NOC Boy Scout House Demolition.docx
34 2. CC Resolution No. 2025-122.pdf

3. Amendment No.1 ATI Restoration.pdf
35

1 Recording Requested by:
2 Office of the City Clerk
3 City of Banning
4 P.O. Box 998
5 Banning, California 92220
6 7 Exempt from Recording Fees Pursuant to Government Code §6103 8 9 NOTICE OF COMPLETION
10 PROJECT “BANNING BOY SCOUTS BUILDING ENVIRONMENTAL CLEAN-UP, 11 ABATEMENT, AND DEMOLITION”
12 13
14 THIS NOTICE OF COMPLETION IS HEREBY GIVEN by the OWNER, the City 15 of Banning, a municipal corporation, pursuant to the provisions of Section 9204 of the Civil 16 Code of the State of California, and is hereby accepted by the City of Banning, pursuant to 17 authority conferred by the City Council this July 14, 2026, and the grantees consent to 18 recordation thereof by its duly authorized agent.
19 20 That the OWNER, the City of Banning, and ATI Restoration, LLC of Anaheim, California, 21 the vendee, entered into an agreement dated August 20, 2025, for Project “Banning Boy 22 Scouts Building Environmental Clean-Up, Abatement, and Demolition”. 23 24 The principal items of work included asbestos testing and removal; hazardous material 25 handling; building demolition; and site restoration. 26 27 That the work of improvement was completed on November 17, 2025, for Project “Banning 28 Boy Scouts Building Environmental Clean-Up, Abatement, and Demolition”. 29 (1) The Nature of Interest was civil improvements completed on November 17, 30 2025, for Project “Banning Boy Scouts Building Environmental Clean-Up, Abatement, and 31 Demolition”.
32 (2) That the City of Banning, a municipal corporation, whose address is 33 Banning City Hall, 99 E. Ramsey Street, Banning, California 92220, is completing work 34 of improvement.
36

1 (3) That said work of improvement was performed at 749 N. San Gorgonio 2 Avenue in Banning, California 92220.
3 (4) That the original contractor for said improvement was ATI Restoration, 4 LLC of Anaheim, California, State Contractor’s License No. 613991. 5 (5) That Performance and Payment bonds were required for this project. 6 (6) The nature of interest is in fee.
7 Dated: July 14, 2026
8 CITY OF BANNING
9 A Municipal Corporation
10 11
12 13 By
14 Elizabeth Gibbs
15 City Manager
16 17 ATTEST:
18 19
20 21 Sandra Calderon
22 Deputy City Clerk
23 24 APPROVED AS TO FORM:
25 26
27 John Pinkney
28 City Attorney
29 Slovak, Baron, Empey, Murphy & Pinkney LLP
30 31
32 37

1 JURAT
2 A notary public or other officer completing this certificate verifies only the identity 3 of the individual who signed the document to which this certificate is attached, 4 and not the truthfulness, accuracy, or validity of that document. 5 6
7 State of California
8 County of Riverside
9 10 Subscribed and sworn to (or affirmed) before me on this ___day of ___________, 2026 11 by ________________________________, who proved to me on this basis of satisfactory 12 evidence to be the person(s) who appeared before me. 13 14
15 16 (S e a l)
17 ______________________________
18 Notary Public in and for said County
19 and State
20 21 STATE OF CALIFORNIA
22 COUNTY OF RIVERSIDE
23 24 SANDRA CALDERON, being duly sworn, deposes and says:
25 26 That I am the Deputy City Clerk of the City of Banning, which City caused the 27 work to be performed on the real property hereinabove described, and is authorized to 28 execute this Notice of Completion on behalf of said City; that I have read the foregoing 29 Notice and know the contents thereof, and that the facts stated therein are true based upon 30 information available to the City of Banning, and that I make this verification on behalf of 31 said City of Banning. I declare under perjury that the forgoing is true and correct. 32 Executed on ___________________, 2026 at Banning, California. 33 34
35 Sandra Calderon
36 Deputy City Clerk
37 City of Banning
38 }
38 RESOLUTION 2025- 122

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

RATIFY THE SOLE SOURCE CONTRACT WITH ATI RESTORATION, LLC FOR HAZARDOUS WASTE CLEAN- UP IN THE AMOUNT OF $ 494, 500
WHEREAS, the City' s insurance carrier solicited proposals for specialized environmental clean- up, due to fire damage at the Boy Scout house located at Repplier Park; and WHEREAS, the City' s insurance carrier negotiated the Scope of Work with ATI Restoration, LLC, to enter into a sole source agreement to complete the tasks as indicated in the environmental testing report; and
WHEREAS, funding will be available in the City' s Public Works Department account during Fiscal Year 25/ 26 in the amount of Four Hundred and Ninety- Four Thousand and Five Hundred Dollars ($ 494, 500); and
WHEREAS, the cost for the environment clean- up provided by ATI Restoration, LLC will be in an amount not- to-exceed Four- Hundred Ninety- Four Thousand, Five- Hundred Dollars 494, 500) and will be fully paid for from insurance funds received by the City.

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

SECTION 1. The City Council ratifies the contract with ATI Restoration, LLC., for an amount not to exceed Four- Hundred Ninety- Four Thousand, Five- Hundred Dollars ($ 494, 500) 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 26th day of August 2025.

Sandra Calderon, Acting Administrative City
Clerk City of Banning
Resolution 2025- 122

Sheri Flynn, Mayor
City of Banning
39 APPROVED AS TO FORM:

Sleva , Baron, Empey, Murphy & Pinkney,
LLP
Resolution 2025- 122

40 CERTIFICATION:

I, Sandra Calderon, Acting Administrative City Clerk of the City of Banning, California, do hereby certify that the foregoing Resolution 2025- 122, was duly adopted by the City Council of the City of Banning, California, at a regular meeting thereof held on the 26th day of August 2025 by the following vote, to wit:

AYES: Barrington, Flynn, Miller, Royce, Wallace
NOES: None
ABSENT: None
ABSTAIN: None
Resolution 2025- 122

Sandra Calderon,
ActingAdministrative City Clerk
City of Banning, California
41 Resolution 2025- 122

Exhibit A
Work Authorization - Commerical Contract
42 City of Banning
Administrative Policy
Subject: Statement oflnvestment Policy
Policy No:

B-11
Reference: Financial Management, Accounting
Effective:

August27, PAGE 1 of17
and Purchasing
2025
APPROVED BY: City Council

1. SCOPE
This Statement of Investment Policy pertains to those funds under the control of the City Council, designated for the ongoing operations of the City, the Banning Finance Authority, the Banning Utility Authority and the Successor Agency to the City of Banning Redevelopment Agency. The Statement oflnvestment Policy concerns the deposit, maintenance, and safekeeping of all such funds, and the investments made with these funds. This Policy does not apply to pension funds, defe1Ted compensation funds, bond funds ( the investment of which is governed by the bond documents), trustee, and ce1iain other non- operating funds.

The City Council must ensure management of public monies in a way that is consistent with investment oversight and sound investment practices. To have a policy which only concerns itself with maximizing return is reckless. The basic concept ofinvestment management is the risk/reward relationship. A higher promised return on any investment may indicate a higher level of risk. Risk management must be an integral part of any prudent investment policy. Risk management must include adequate internal controls, so the public has confidence that public monies are secure. Though all investments contain a degree of risk, the proper exercise of prudence, the maintenance of a high level of ethical standards, and the proper delegation of authority reduces the potential for loss.

The Finance Director may direct specific- purpose assets belonging to the City, the earnings of which are not shared but credited to the specific- purpose fund. The investments for these direct investment pools shall be made in accordance with this Policy, except that investments may be for periods greater than five years when a longer term is advantageous for the investment of money held for specific purposes. Investments for periods longer than five years require prior approval of the governing body in accordance with Government Code Section 53601.

2. PURPOSE OFPOLICYSTATEMENT
The purpose of this Statement oflnvestment Policy is to provide the public and those involved in servicing the investment requirements of the City, and any other interested party, a clearer understanding of the Government Code, regulations and internal guidelines that will be observed in maintaining and investing those funds not immediately needed to meet liabilities. This policy is written to incorporate industry best practices and recommendations from sources such as the Government Finance Officers Association ( GFOA), California Municipal Treasurers Association PolicyB- 11
43 CMTA), California Debt and Investment Advisory Commission ( CDIAC) and the Association of Public Treasurers ( APT).

3. INVESTMENT OBJECTIVES
The underlying objective of the City Council is to protect the safety of the principal of the portfolio through the judicious purchase ofthose legal investments permitted to local agencies, as defined in the State of California Government Code, consistent with current conditions and the other dominant objectives pursuant to managing a local agency portfolio. The objectives of this Investment Policy are, in order of priority:

A. Safety. The City Council takes as its primary responsibility to maintain the safe return of all principal placed in investments by avoiding decisions that might result in losses through fraud, default, or adverse market conditions. Importance is also accorded to the protection of accrued interest earned on any investment instrument. To attain this objective, the City will diversify its inveshnents by investing funds among a variety of securities with independent returns.

B. Liquidity. The investment portfolio will remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated.

C. Yield. While it is considered desirable to obtain a respectable yield, yield shall not be the driving force in determining which investments are to be selected for purchase. Yield is to be given lesser weight in the investment decision than safety, liquidity, or availability.

Investment shall be placed with the objective of obtaining a reasonable rate of return under prevailing market conditions.

4. PRUDENCE
The City Council and the City' s investment officials recognize that they are subject to the Prudent Investor Standard" whenever making a decision regarding the investment of the City' s funds. The Prudent Investor Standard states, " ... all governing bodies of local agencies or persons authorized to make inveshnent decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, general economic conditions and the anticipated needs of the agency, that a prudent person acting in like capacity and familiarity with those matters would use in the conduct offunds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law." ( Cal. Gov. Code § 53600. 3).

The City Council, and those acting under the delegation ofauthority of the City Council, are deemed to have a fiduciary trustee relationship with the public for the public funds, and all investment decisions will be made in accordance their fiduciary duties. 2 PolicyB- 11
44 5. DELEGATION OF AUTHORITY
Authority to manage the City' s investment program is derived from California Government Code, Sections 41006 and 53600 et seq.

While the City Council has fiduciary responsibility for the investment of public funds, City personnel are required to act in the day to day administration of the City' s investment program.

The deputized personnel ( also referred to as investment officials) listed below are designated to manage the City' s investment program consistent with this investment policy:

Finance Director
Deputy Finance Director
City Manager
City Council directives to the Finance Director, Deputy Finance Director and City Manager are as follows:

Manage the day to day operations of the City' s investment portfolio and place actual purchase/ sell orders with authorized institutions.

Make investments in accordance with this policy.

Communicate with necessary parties for investment purposes and to withdraw and deposit funds as required to meet the City' s cash flow needs.

Other persons, both inside and outside City employment, may act in the role of assistant or advisor to those listed above, to aid in the timely and proper settlement of investment transactions. Such persons may not authorize, approve, or initiate any trading activities. Parties involved in investment transactions with the City are deemed to be on notice ofthe contents of the most current copy ofthis Policy, and all pertinent authorizing documents, at the time of accepting written or verbal instructions from any staff member.

The City may engage the services of one or more external investment advisers, who are registered under the Investment Advisers Act of 1940, to assist in the management of the City' s investment portfolio in a manner consistent with the City' s objectives. External investment advisers may be granted discretion to purchase and sell investment securities in accordance with this investment policy.

The City' s overall investment program shall be designed and managed with a degree of professionalism that is worthy of the public trust. The City recognizes that in a diversified portfolio, occasional measured losses may be inevitable and must be considered within the context of the overall portfolio' s return and the cash flow requirements of the City.

6. SECURITIES CUSTODY
As required by the Government Code, the Finance Director shall establish a third party custody and safekeeping account to which all negotiable instruments shall be delivered upon purchase on a payment versus delivery basis. All cash and securities in the City' s portfolio 3 Policy B-11
45 shall be held in safekeeping in the City' s name by the third party custodian, acting as an agent for the City under the terms of a custody agreement executed by the bank and the City.

The only exceptions to the foregoing shall be depository accounts and securities purchases made with: ( i) local government investment pools; ( ii) time certificates of deposit, and, ( iii) mutual funds and money market mutual funds, since these securities are not deliverable.

7. AUTHORIZED INVESTMENTS AND LIMITATIONS
The Government Code of the State of California, primarily within sections 53600 et. seq., sets out the legal authority for inclusion of certain types of investment vehicles in a California local agency' s investment portfolio. Consistent with those sections, under no circumstances will the City Council purchase an investment that is not specifically authorized for a local agency under these, or other code sections that may apply, or might later be enacted, pe1taining to local agency investments. It shall be a requirement of all investment professionals performing any transaction on behalf of the City that they possess a complete w1derstanding of the acceptability of the subject investment under those code sections.

Appendix A briefly describes the principal types of securities legal within the Government Code sections noted above, and outlines the various limitations included in these sections. From these permitted investments, the City' s investment officials shall determine those investment types that best meet the needs and abilities of the City.

Any investment currently held at the time the policy is adopted which does not meet the new policy guidelines can be held until maturity and shall be exempt from the current policy. At the time of the investment' s maturity or liquidation, such funds shall be reinvested only as provided in the current policy.

An appropriate risk level shall be maintained by primarily purchasing securities that are of high quality, liquid, and marketable. The portfolio shall be diversified by security type and institution to avoid incurring umeasonable and avoidable risks regarding specific security types or individual issuers.

A. Prohibited Investment Vehicles and Practices
State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options.

In accordance with Government Code, Section 53601. 6, investment in inverse floaters, range notes, or mortgage derived interest- only strips is prohibited.

Investment in any security that could result in a zero interest accmal if held to maturity is prohibited. Under a provision sunsetting on January 1, 2026, securities backed by the U.S.

Government that could result in a zero- or negative- interest accmal ifheld to maturity are permitted.

Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited.

Purchasing or selling securities on margin is prohibited. 4 PolicyB-11
46 The use of reverse repurchase agreements, securities lending or any other fo1m of borrowing or leverage is prohibited.

The purchase of foreign currency denominated securities is prohibited.

Agencies that are not Qualified Institutional Buyers ( QIB) as defined by the Securities and Exchange Commission are prohibited from purchasing Private Placement Securities. The SEC defines a QIB as having at least $ 100, 000, 000 in securities owned and invested.

The purchase of a security with a forward settlement date exceeding 45 days from the time of the investment is prohibited.

8. AUTHORIZED TERM OF INVESTMENTS
It is hereby determined that the maximum maturity period for any portion of invested operating moneys shall not exceed five years from the date of trade settlement per California Government Code and as indicated in Appendix A, unless the City Council has by resolution granted authority to make such an investment. This shall not apply to ce1iain bond proceeds or other non- operating moneys of the City. To the extent possible, investments shall be matched with anticipated cash flow requirements and known future liabilities.

9. AUTHORIZED DEALER LIST- CONFLICT OF INTEREST PROHIBITION It is prohibited for a transaction to be entered into with any securities broker, dealer or bank investment department or subsidiary prior to that entity being designated an Authorized Dealer and placed on the Authorized Dealer List. Authorized Dealers shall be selected on an as needed basis to meet specific needs of the City. The Finance Director is authorized to manage the Authorized Dealer List. Each qualified dealer must certify in writing that they have reviewed the relevant California Government Code Sections and the City' s Investment Policy and that all securities offered to the City shall comply fully and in every instance with all provisions of the California Government Code and with this Investment Policy. Selection of financial institutions and broker/ dealers authorized to engage in transactions will be at the sole discretion of the City, except where the City utilizes an external investment adviser in which case the Agency may rely on the adviser for selection.

In accordance with Section 53601. 5, institutions eligible to transact investment business with the City include:

Institutions licensed by the state as a broker- dealer.

Institutions that are members of a federally regulated securities exchange.

Primary government dealers as designated by the Federal Reserve Bank and non- primary gove1nment dealers.

Nationally or state- chartered banks.

The Federal Reserve Bank.

Direct issuers of securities eligible for purchase.

Selection of broker/ dealers used by an external investment adviser retained by the City will be at the sole discretion of the adviser. Where possible, transactions with broker/ dealers shall be selected on a competitive basis and their bid or offering prices shall be recorded. Ifthere is no other readily available competitive offering, best efforts will be made to document quotations for comparable or 5 PolicyB- 11
47 alternative securities. When purchasing original issue instrumentality securities, no competitive offerings will be required as all dealers in the selling group offer those securities at the same original issue price.

No member of the City Council, nor any other official or employee of the City, may accept any gift, honoraria, gratuity or service of value in violation ofthe regulations set forth by the Fair Political Practices Commission, the Government Code, additional limitations set forth by City ordinance, or internal requirements of the City Manager and Finance Director. The City Council is prohibited from conducting any business with any broker, dealer, or securities firm that has made a political contribution to the City Treasurer or any member of the City Council, or any candidate for these offices, within the 48 month period immediately following the date ofthe political contribution, in an amount exceeding the limitation contained in Rule G-37 of the Municipal Securities Rulemaking Board.

10. PORTFOLIO RISK MANAGEMENT
A. Mitigating Credit Risk in the Portfolio
Credit risk is the risk that a security or a portfolio will lose some or all of its value due to a real or perceived change in the ability of the issuer to repay its debt. The Finance Director shall mitigate credit risk by adopting the following strategies:

1. The diversification requirements included in Appendix A Permitted Investments are designed to mitigate credit risk in the portfolio.

2. The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to improve the quality, liquidity or yield of the portfolio in response to market conditions or the City' s risk preferences.

3. No more than 5% of the total portfolio may be deposited with or invested in securities issues by any single issuer unless othe1wise specified in this policy.

4. Ifthe securities owned by the City are downgraded by Moody' s, S& P, or Fitch to a level below the quality required by this Investment Policy, it shall be the City' s policy to review the credit situation and make a detennination as to whether to sell or retain such securities in the portfolio. City investment officials will use discretion in determining whether to sell or hold the security based on its current maturity, the loss in value, the economic outlook for the issuer, and other relevant factors.

5. The City will continue to monitor and reevaluate the security on an ongoing basis in order to reaffirm or change the decision to hold a downgraded security.

6. If a decision is made to retain a downgraded security in the portfolio, the status of the investment will be reported quarterly to the City Council. 6 PolicyB- 11
48 B. Mitigating Market Risk in the Portfolio
Market risk is the risk that the portfolio will decline in value ( or will not optimize its value) due to changes in the general level of interest rates. The City recognizes that, over time, longer- term portfolios generally achieve higher returns. On the other hand, longer- term portfolios have a higher volatility ofretum. The City shall mitigate market risk by providing adequate liquidity for cash needs, and by making longer- term investments only with funds that are not needed for current cash flow purposes. The City further recognizes that certain types of securities, including variable rate securities, and securities with embedded options, will affect the market risk profile ofthe portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk:

1. All investments are categorized according to the period of time from settlement date to maturity date. Market circumstances and risk- return calculations for increased yield may require an extended schedule.

2. The maximum stated final maturity of individual securities in the portfolio shall be five years, except as otherwise stated in this policy. The five- year maturity of callable securities is measured to the final maturity date, not to a call date.

3. Maturity of investments should be governed by the Treasury' s demand for funds through analysis of revenue and expenditure activity over prior periods. The portfolio shall be structured in such manner that securities mature concurrent with cash needs.

4. The duration of the portfolio will generally be approximately equal to the duration typically, plus or minus 20%) of a market benchmark, and index selected by the City based on the City' s investment objectives, constraints and risk tolerances.

C. Mitigating Reinvestment Risk in the Portfolio
Reinvestment risk is the risk that cash flows from securities will be reinvested at interest rates that are lower than the rate of the original investment. Securities that are highly subject to reinvestment risk include mortgage- backed and callable securities. The City, therefore, adopts the following strategies to control and mitigate its exposure to reinvestment risk:

1. The portfolio shall include securities with a range of durations and maturities.

2. Investment in federal agency callable securities is limited to 20%.

11. LEGISLATIVE CHANGES
Any State of California legislative action that further restricts allowable maturities, investment type, or percentage allocations will be incorporated immediately into the Investment Policy.

12. REPORTING AND ANNUAL REVIEW
The Finance Director shall cause to be maintained investment records legally required or othe1wise requested by the City Council and prepare a report for the Council on a 7 PolicyB- 11
49 monthly basis stating the holdings, status, and earnings of the portfolio. The Statement of Investment Policy will be provided annually for review and approval of the City Council. Should conditions arise, or legislation become effective that behooves consequential changes within the Policy during the year, the revised policy will again be addressed by the City Council. 8 PolicyB- 11
50 APPENDIX A

PERMITTED INVESTMENTS

1. Municipal Securities include obligations of the City, the State of California and any local agency within the State of California, provided that:

The securities are rated in a rating category of "A" or its equivalent or better by at least one nationally recognized statistical rating organization (" NRSRO").

No more than 5% of the portfolio may be invested in any single issuer.

No more than 30% of the portfolio may be in Municipal Securities.

The maximum maturity does not exceed five ( 5) years.

2. MUNICIPAL SECURITIES ( REGISTERED TREASURY NOTES OR BONDS) of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue- producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California.

The securities are rated in a rating category of "A" or its equivalent or better by at least one nationally recognized statistical rating organization (" NRSRO").

No more than 5% of the portfolio may be invested in any single issuer.

No more than 30% of the portfolio may be in Municipal Securities.

The maximum maturity does not exceed five ( 5) years.

3. U.S. TREASURIES and other government obligations for which the full faith and credit of the United States are pledged for the payment of principal and interest. There are no limits on the dollar amount or percentage that the City may invest in U.S. Treasuries, provided that:

The maximum maturity is five ( 5) years.

4. FEDERAL AGENCIES or United States Government- Sponsored Enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government- sponsored enterprises. There are no limits on the dollar amount or percentage that the City may invest in Federal Agency or Government- Sponsored Enterprises ( GSEs), provided that:

No more than 30% of the portfolio may be invested in any single Agency/ GSE issuer.

The maximum maturity does not exceed five ( 5) years.

The maximum percent of agency callable securities in the portfolio will be 20%.

5. BANKER' S ACCEPTANCES, provided that:

They are issued by institutions which have short- term debt obligations rated " A-1" or its equivalent or better by at least one NRSRO; or long- tenn debt obligations which are rated in a rating category of "A" or its equivalent or better by at least one NRSRO.

No more than 40% of the portfolio may be invested in Banker' s Acceptances.

No more than 5% of the portfolio may be invested in any single issuer. 9 PolicyB- 11
51 The maximum maturity does not exceed 180 days.

6. COMMERCIAL PAPER, provided that the securities are issued by an entity that meets all of the following conditions in either paragraph ( a) or (b) and other requirements specified below:
a. SECURITIES issued by corporations:
i) A corporation organized and operating in the United States with assets more than $ 500 million.
ii) The securities are rated " A-1" or its equivalent or better by at least one NRSRO. iii) If the issuer has other debt obligations, they must be rated in a rating category of" A" or its equivalent or better by at least one NRSRO.
b. SECURITIES issued by other entities:
i) The issuer is organized within the United States as a special purpose corporation, trust, or limited liability company.
ii) The securities must have program- wide credit enhancements including, but not limited to, overcollateralization, letters of credit, or a surety bond. iii)The securities are rated " A-1" or its equivalent or better by at least one NRSRO.

No more than 10% of the outstanding commercial paper of any single issuer.

No more than 25% of the City' s investment assets under management may be invested in Commercial Paper. Under a provision sunsetting on January 1, 2026, no more than 40% of the portfolio may be invested in Commercial Paper ifthe Agency' s investment assets under management are greater than $ 100, 000, 000.

No more than 5% of the portfolio may be invested in any single issuer.

The maximum maturity does not exceed 270 days.

7. NEGOTIABLE CERTIFICATES OF DEPOSIT ( NCDs), issued by a nationally or state- chartered bank, a savings association or a federal association, a state or federal credit union, or by a federally licensed or state- licensed branch of a foreign bank, provided that:

The amount of the NCD insured up to the FDIC limit does not require any credit ratings.

Any amount above the FDIC insured limit must be issued by institutions which have shortterm debt obligations rated " A-1" or its equivalent or better by at least one NRSRO; or long- term obligations rated in a rating category of "A" or its equivalent or better by at least oneNRSRO.

No more than 30% of the total portfolio may be invested in NCDs ( combined with CDARS).

No more than 5% of the portfolio may be invested in any single issuer.

The maximum maturity does not exceed five ( 5) years.

8. FEDERALLY INSURED TIME DEPOSITS ( Non- Negotiable Certificates of Deposit) in state or federally chartered banks, savings and loans, or credit unions, provided that:

The amount per institution is limited to the maximum covered under federal insurance.

IO
PolicyB- 11
52 No more than 20% of the portfolio will be invested in a combination of federally insured and collateralized time deposits.

The maximum maturity does not exceed five ( 5) years.

9. COLLATERALTZED TIME DEPOSITS ( Non- Negotiable Certificates of Deposit) in state or federally chartered banks, savings and loans, or credit unions in excess of insured amounts which are fully collateralized with securities in accordance with California law, provided that:

No more than 20% of the portfolio will be invested in a combination of federally insured and collateralized time deposits.

The maximum maturity does not exceed five ( 5) years.

10. CERTIFICATE OF DEPOSIT PLACEMENT SERVICE ( CDARS), provided that:

No more than 30% of the total portfolio may be invested in a combination of Certificates of Deposit, including CDARS.

The maximum maturity does not exceed five ( 5) years.

11. COLLATERALIZED BANK DEPOSITS. City' s deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651. There are no limits on the dollar amount or percentage that the City may invest in collateralized bank deposits.

12. REPURCHASE AGREEMENTS collateralized with securities authorized under California Government Code, maintained at a level of at least 102% of the market value of the Repurchase Agreement. There are no limits on the dollar amount or percentage that the City may invest, provided that:

Securities used as collateral for Repurchase Agreements will be delivered to an acceptable third party custodian.

Repurchase Agreements are subject to a Master Repurchase Agreement between the City and the provider of the repurchase agreement. The Master Repurchase Agreement will be substantially in the form developed by the Securities Industry and Financial Markets Association ( SIFMA).

The maximum maturity does not exceed one ( 1) year.

13. STATE OF CALIFORNIA LOCAL AGENCY INVESTMENT FUND ( LAIF), provided that:

The City may invest up to the maximum amount permitted by LAIF.

LAIF' s investments in instruments prohibited by or not specified in the City' s policy do not exclude the investment in LAIF itself from the City' s list of allowable investments, provided LAIF' s reports allow the Finance Director to adequately judge the risk inherent in LAIF' s portfolio.

14. LOCAL GOVERNMENT INVESTMENT POOLS
Other LGIPs pe1mitted by client.

PolicyB- 11
11 53
There is no issuer limitation for Local Government Investment Pools

15. CORPORATE MEDIUM TERM NOTES ( MTNs), provided that:

The issuer is a corporation organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States.

The securities are rated in a rating category of "A" or its equivalent or better by at least one NRSRO.

No more than 30% of the total portfolio may be invested in MTNs.

No more than 5% of the portfolio may be invested in any single issuer.

The maximum maturity does not exceed five ( 5) years.

16. ASSET- BACKED, MORTGAGE- BACKED, MORTGAGE PASS- THROUGH SECURITIES, AND COLLATERALIZED MORTGAGE OBLIGATIONS FROM ISSUERS NOT DEFINED IN SECTIONS 3 AND 4 OF THE AUTHORIZED INVESTMENTS SECTION OF THIS POLICY, provided that:

The securities are rated in a rating category of "AA" or its equivalent or better by a NRSRO.

No more than 20% of the total portfolio may be invested in these securities.

No more than 5% of the portfolio may be invested in any single Asset- Backed or Commercial Mortgage security issuer.

The maximum legal final maturity does not exceed five ( 5) years.

17. MUTUAL FUNDS AND MONEY MARKET MUTUAL FUNDS that are registered with the Securities and Exchange Commission under the Investment Company Act of 1940, provided that:
a. MUTUAL FUNDS that invest in the securities and obligations as authorized under California Government Code, Section 53601 ( a) to (k) and ( m) to ( q) inclusive and that meet either of the following criteria:
i) Attained the highest ranking or the highest letter and numerical rating provided by not less than two ( 2) NRSROs; or
ii) Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years' experience investing in the securities and obligations authorized by California Government Code, Section 53601 and with assets under management in excess of $500 million.

No more than 10% of the total portfolio may be invested in shares of any one mutual fund. b. MONEY MARKET MUTUAL FUNDS registered with the Securities and Exchange Commission under the Investment Company Act of 1940 and issued by diversified management companies and meet either of the following criteria:
i) Have attained the highest ranking or the highest letter and numerical rating provided by not less than two ( 2) NRSROs; or
12 PolicyB- 11
54 ii) Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years' experience managing money market mutual funds with assets under management in excess of $500 million.

No more than 20% of the total portfolio may be invested in the shares of any one Money Market Mutual Fund.
c. No more than 20% of the total portfolio may be invested in these securities.

18. SUPRANATIONALS, provided that:

Issues are US dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter- American Development Bank.

The securities are rated in a rating category of "AA" or its equivalent or better by a NRSRO.

No more than 30% of the total portfolio may be invested in these securities.

No more than 10% of the portfolio may be invested in any single issuer.

The maximum maturity does not exceed five ( 5) years.
13 PolicyB- 11
55 APPENDIX B GLOSSARY OF TERMS
ACCRUED INTEREST - The amount of interest that is earned, but unpaid since the last payment date.

BANKERS ACCEPTANCES- A draft or bill or exchange accepted by a bank or tmst company. The accepting institution, as well as the issuer, guarantees payment ofthe bill. With the credit strength of a bank behind it, the bankers acceptance usually qualifies as a money market instrument. In its simplest and most traditional fom1, a bankers acceptance is merely a check drawn on a bank by an importer or expmier of goods.

BASIS POINT - A unit of measurement used in the valuation of fixed- income securities equal to 1/100 of 1 percent of yield, e.g., " 1/4" of 1 percent is equal to 25 basis points.

BID- The indicated price at which a buyer is willing to purchase a security or commodity.

BOOK ENTRY - The system maintained by the Federal Reserve, by which most money market securities are delivered to an investor' s custodian bank. The Federal Reserve maintains a computerized record of the ownership of these securities and records any changes in ownership corresponding to payments made over the Federal Reserve wire ( delive1y versus payment).

BOOK VALUE - The value at which a security is ca1Tied on the inventory lists or other financial records of an investor. The book value may differ significantly from the security' s current value in the market.

BROKER/ DEALER- Any person engaged in the business of effecting transactions in securities in this state for the account of others or for her/ his own account. Broker/ dealer also includes a person engaged in the regular business ofissuing or guaranteeing options with regard to securities not of her/ his own issue.

CALIFORNIA DEBT AND INVESTMENT ADVISORY COMMISSION ( CDIAC)- The CDIAC provides infonnation, education, and technical assistance on public debt and investments to local public agencies and other public finance professionals.

CALLABLE BOND - A bond issue in which all or part of its outstanding principal amount may be redeemed before maturity by the issuer under specified conditions.

CALL PRICE - The price at which an issuer may redeem a bond prior to maturity. The price is usually at a slight premium to the bond' s original issue price to compensate the holder for loss of income and ownership.

CALL RISK - The risk to a bondholder that a bond may be redeemed prior to maturity.

CASH SALE/ PURCHASE - A transaction which calls for delivery and payment of securities on the same day that the transaction is initiated.

COLLERATERALIZATION - Process by which a borrower pledges securities, property, or other deposits for the purpose of securing the repayment of a loan and/ or security including:
14 Policy B-11
56 CERTIFICATES OF DEPOSIT ( CDS) - The City shall require any commercial bank or savings and loan association to deposit eligible securities with an agency of a depository approved by the State Banking Department to secure any uninsured portion of a NonNegotiable Certificate of Deposit. The value of eligible securities as defined pursuant to California Government Code, Section 53651, pledged against a Certificate of Deposit shall be equal to 150% of the face value of the CD ifthe securities are classified as m01igages and 110% of the face value of the CD for all other classes of security.

COLLATERALIZATION OF BANK DEPOSITS - This is the process by which a bank or financial institution pledges securities, or other deposits for the purpose of securing repayment of deposited funds. The City shall require any bank or financial institution to comply with the collateralization criteria defined in California Government Code, Section 53651.

REPURCHASE AGREEMENTS - The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code:

The securities which collateralize the repurchase agreement shall be priced at Market Value, including any Accrued Interest plus a margin. The Market Value of the securities that underlie a repurchase agreement shall be valued at 102% or greater of the funds borrowed against those securities.

Financial institutions shall mark the value of the col1ateral to market at least monthly and increase or decrease the collateral to satisfy the ratio requirement described above.

The City shall receive monthly statements of collateral.

COMMERCIAL PAPER - An unsecured short- term promissmy note issued by banks, corporations and other borrowers with temporarily idle cash, with maturities ranging from 2 to 270 days. Such instruments are usually discounted, although some are interest bearing. It is issued only by top- rated concerns and is nearly always backed by bank lines of credit.

CONFIRMATION - Fonnal memorandum from a broker/ dealer to the City giving the details of a securities transaction, i.e., purchase or sale.

COUPON RATE - The annual rate of interest received by an investor from the issuer of certain types of fixed- income securities. Also known as the " interest rate." CREDIT QUALITY - The measurement of the financial strength of a bond issuer. This measurement helps an investor to understand an issuer' s ability to make timely interest payments and repay the loan principal upon maturity. Generally, the higher the credit quality of a bond issuer, the lower the interest rate paid by the issuer because the risk of default is lower. Credit quality ratings are provided by nationally recognized rating agencies.

CREDIT RISK - The risk to an investor that an issuer will default in the payment of interest and/ or principal on a security.

CURRENT YIELD ( CURRENT RETURN) - A yield calculation determined by dividing the annual interest received on a security by the current market price of that security. 15 Policy B-11
57 CUSTODIAN/ CUSTODY - The financial institution where the investments purchased by the City are held.

DELIVERY VERSUS PAYMENT ( DVP) - A type of securities transaction in which the purchaser pays for the securities when they are delivered either to the purchaser or his/ her custodian.

DERIVATIVE - Financial instrument created from, or whose value depends upon, one or more underlying assets or indexes of asset values.

DISCOUNT - The amount by which the par value of a security exceeds the price paid for the security.

DIVERSIFICATION- The spreading ofrisk by investing in assets among a range of security types by sector, maturity, and quality rating.

DURATION - A measure of the timing of the cash flows, such as the interest payments and the principal repayment, to be received from a given fixed- income security. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity. The duration of a security is a useful indicator of its price volatility for given changes in interest rates.

EARNINGS APPORTIONMENT- The quarterly interest distribution to the Investment Pool participants where the actual investment costs incurred by the City are deducted from the interest earnings of the Investment Pool.

FAIR VALUE - The amount at which an investment could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

FEDERAL FUNDS - Funds placed in Federal Reserve banks by depository institutions in excess of current reserve requirements. These depository institutions may lend Fed funds to each other overnight or on a longer basis. They may also transfer funds among each other on a same- day basis through the Federal Reserve banking system. Fed funds are considered to be immediately available funds.

FEDERAL FUNDS RATE - Interest rate charged by one institution lending Federal funds to the other.

FITCH IBCA, INC. (FITCH) - One of the three best known rating agencies in the United States, the others being Moody' s Investment Service, Inc. ( Moody' s), and Standard and Poor' s Corporation ( S & P).

GUARANTEED INVESTMENT CONTRACTS ( GICS) - An agreement acknowledging receipt of funds for deposit, specifying terms for withdrawal, and guaranteeing a rate of interest to be paid.

GOVERNMENT SECURITIES- An obligation of the U.S. government, backed by the full faith and credit of the government. These securities are regarded as the highest quality of investment securities available in the U.S. securities market. See " Treasury Bills, Notes, and 16 Policy B-11
58 Bonds."
HIGHLY LIQUID - The most eminent type of security that is easily converted to cash because there are many interested buyers and sellers to trade large quantities at a reasonable price.

IDLE FUNDS - funds in the combined Investment Pool not required for immediate cash needs.

ILLIQUID- A security that is difficult to buy or sell or has a wide spread between bid price and offer price in the secondary market. There are few buyers and sellers willing to trade large quantities at a reasonable price.

INFORMAL COMPETITIVE BID - A verbal or written bid submitted to the City by a broker/ dealer for a specific issue at a specific price or yield.

INTEREST RATE - See " Coupon Rate."
INTEREST RATE RISK - The risk associated with declines or rises in interest rates which cause an investment in a fixed- income security to increase or decrease in value.

INTERNAL CONTROLS - An internal control structure designed to ensure that the assets of the entity are protected from loss, theft, or misuse. The internal control structure is designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that 1) the cost of a control should not exceed the benefits likely to be derived and 2) the valuation of costs and benefits requires estimates and judgments by management. Internal controls should address the following points:

1. Control of collusion - Collusion is a situation where two or more employees are working in conjunction to defraud their employer.

2. Separation oftransaction authority from accounting and record keeping - By separating the person who authorizes or performs the transaction from the people who record or otherwise account for the transaction, a separation of duties is achieved.

3. Custodial safekeeping - Securities purchased from any bank or dealer including appropriate collateral ( as defined by state law) shall be placed with an independent third party for custodial safekeeping.

4. Avoidance of physical delivery securities - Book- entry securities are much easier to transfer and account for since actual delivery of a document never takes place. Delivered securities must be properly safeguarded against loss or destruction. The potential for fraud and loss increases with physically delivered securities.

5. Clear delegation of authority to subordinate staff members - Subordinate staff members must have a clear understanding of their authority and responsibilities to avoid improper actions.

Clear delegation of authority also preserves the internal control structure that is contingent on the various staff positions and their respective responsibilities.

6. Written confirmation of transactions for investments and wire transfers - Due to the potential for error and improprieties arising from telephone and electronic transactions, all transactions should be supported by written communications and approved by the appropriate person.

Written communications may be via fax if on letterhead and ifthe safekeeping institution has a list of authorized signatures.

7. Development of a wire transfer agreement with the lead bank and third party custodian - The 17 PolicyB- 11
59 designated official should ensure that an agreement will be entered into and will address the following points: controls, security provisions, and responsibilities of each party making and receiving wire transfers.

INVERTED YIELD CURVE - A chart formation that illustrates long- term securities having lower yields than short- term securities. This configuration usually occurs dming periods of high inflation coupled with low levels of confidence in the economy and a restrictive monetary policy.

INVESTMENT POLICY - A concise and clear statement of the objectives and parameters formulated by an investor or investment manager for a portfolio of investment securities.

INVESTMENT- GRADE OBLIGATIONS - An investment instrument suitable for purchase by institutional investors under the prudent person rule. Investment- grade is restricted to those obligations rated BBB or higher by a rating agency.

LIQUID - An asset that can be conve11ed easily and quickly into cash because of the willingness of interested buyers and sellers to trade large quantities at a reasonable price.

LOCAL AGENCY INVESTMENT FUND ( LAIF)- The State of California investment pool in which money of local agencies is pooled as a method for managing and investing local funds.

LOCAL AGENCY OBLIGATION - An indebtedness issued by a local agency, department, board, or authority within the State of California.

LONG- TERM - A security with the maturity greater than one year.

MARK- TO- MARKET - The process whereby the book value or collateral value of a security is adjusted to reflect its current market value.

MARKET RISK - The risk that the value of a security will rise or decline as a result of changes in market conditions.

MARKET VALUE - The price at which a security is trading and presumably could be purchased or sold at a particular point in time.

MATURITY - The date on which payment of a financial obligation is due. The final stated maturity is the date on which the issuer must retire a bond and pay the face value to the bondholder. See " Weighted Average Maturity."
MEDIUM TERM NOTES- Corporate Notes and Deposit Notes that are obligations of banks, corporations, and insurance companies. They are issued at a specific rate of return for a specific period of time.

MONEY MARKET MUTUAL FUND - Mutual funds that invest solely in money market instrnments ( short- term debt instruments, such as Treasury bills, commercial paper, bankers' acceptances, repos and federal funds).

MOODY' S INVESTORS SERVICE, INC. ( Moody' s) - One of the three best known rating 18 PolicyB- 11
60 agencies in the United States, the others being Standard and Poor' s Corporation ( S& P) and Fitch IBCA, Inc. ( Fitch).

MUTUAL FUND - An investment company that pools money and can invest in a variety of securities, including fixed- income securities and money market instruments. Mutual funds are regulated by the Investment Company Act of 1940 and must abide by the following Securities and Exchange Commission ( SEC) disclosure guidelines:

1. Report standardized performance calculations.

2. Disseminate timely and accurate information regarding the fund' s holdings, performance, management and general investment policy.

3. Have the fund' s investment policies and activities supervised by a board of trustees, which are independent of the adviser, administrator or other vendor of the fund.

4. Maintain the daily liquidity of the fund' s shares.

5. Value their po1ifolios on a daily basis.

6. Have all individuals who sells SEC- registered products licensed with a self- regulating organization ( SRO) such as the National Association of Securities Dealers ( NASD).

7. Have an investment policy governed by a prospectus which is updated and filed by the SEC annually.

NATIONAL ASSOCIATION OF SECURITIES DEALERS ( NASD)- A self- regulatory organization ( SRO) of brokers and dealers in the over- the- counter securities business. Its regulatory mandate includes authority over firms that distribute mutual fund shares as well as other securities.

NEGOTIABLE CERTIFICATE OF DEPOSIT- A Money Market instrument representing a receipt from a bank for a deposit at a specified rate of interest for a specified period of time that is traded in the secondary markets.

NET ASSET VALUE - The market value of one share of an investment company, such as a mutual fund. This figure is calculated by totaling a fund' s assets which includes securities, cash, and any accrued earnings, subtracting this from the fund' s liabilities and dividing this total by the number of shares outstanding. This is calculated once a day based on the closing price for each security in the fund' s portfolio.

NO LOAD FUND - A mutual fund which does not levy a sales charge on the purchase of its shares.

NOMINAL YIELD - The stated rate of interest that a bond pays its cmTent owner, based on par value of the security. Itis also known as the " coupon," " coupon rate," or "interest rate." NONCALLABLE- A bond that is exempt from any kind ofredemption for a stated time period.

NOTE- A written promise to pay a specific amount to a certain entity on demand or on a specified date.

OFFER- An indicated price at which market participants are willing to sell a security or 19 PolicyB- 11
61 commodity. Also referred to as the " Ask price."
PAR- Face value or principal value of a bond, typically $ 1,000 per bond.

PORTFOLIO - Combined holding of more than one stock, bond, cash equivalent, or other asset. The purpose of a portfolio is to reduce risk by diversification.

POSITIVE YIELD CURVE - A chart formation that illustrates short- tenn securities having lower yields than long- term securities.

PREMIUM - The amount by which the price paid for a security exceeds the security' s par value.

PRIMARY DEALER - A group of securities dealers that submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission ( SEC) registered securities broker- dealers and banks.

PRIME RATE - A preferred interest rate charged by commercial banks to their most creditworthy customers. Many interest rates are keyed to this rate.

PRINCIPAL - The face value or par value of a debt instrument. Also may refer to the amount of capital invested in a given security.

PROSPECTUS - A legal document that must be provided to any prospective purchaser of a new securities offering registered with the SEC. This can include information on the issuer, the issuer' s business, the proposed use of proceeds, the experience of the issuer' s management, and ce1iain certified financial statements ( also known as an " official statement").

PRUDENT INVESTOR RULE - An investment standard where a person acts with care, ski11, prudence, and diligence when investing, reinvesting, purchasing, acquiring, exchanging, selling, and managing funds. The test of whether the standard is met is if a prudent person acting in such a situation would engage in similar conduct to ensure investments safeguard principal and maintain liquidity.

PUT OPTION - The sale of an option to another party giving them the 1ight to sell to the Investment Pool a security at a specified price within a specified time period.

RATING- Evaluation of financial institutions' investment and credit risks by professional rating services.

REGISTERED STA TEW ARRANT- A shmt- tenn obligation of a state governmental body issued in anticipation of revenue.

REGULAR WAY DELIVERY - Securities settlement that calls for delivery and payment on the third business day following the trade date ( T + 3 ); payment on a T + I basis is currently under consideration. Mutual funds are settled on a same day basis; government securities are settled on the next business day.
20 PolicyB- 11
62 REINVESTMENT RISK - The risk that a fixed- income investor will be unable to reinvest income proceeds from a security holding at the same rate ofreturn cmTently generated by that holding.

REPURCHASE AGREEMENT ( REPO) - An agreement of one party to sell securities at a specified price to a second party and a simultaneous agreement of the first party to repurchase the securities at a specified price or at a specified later date.

REVERSE REPURCHASE AGREEMENT ( REVERSE REPO) - An agreement of one party to purchase securities at a specified price from a second paiiy and a simultaneous agreement by the first party to resell the securities at a specified price to the second party on demand or at a specified date.

SAFEKEEPING - A custodian bank' s action to store and protect an investor' s securities by segregating and identifying the securities.

SECURITIES AND EXCHANGE COMMISSION ( SEC) - Agency created by Congress to protect investors in securities transactions by administering securities laws. The statutes administered by the SEC are designed to promote full public disclosure and protect the investing public against malpractice in the securities market.

SECURITIES LENDING- A transaction wherein the Investment Pool transfers its securities to broker/ dealers and other entities for collateral which may be cash or securities and simultaneously agrees to return the collateral for the same securities in the future.

SERIAL BOND - A bond issue, usually of a municipality, with various maturity dates scheduled at regular intervals until the entire issue is retired.

SHORT- TERM - A security with a maturity one year or less.

STANDARD AND POOR' S CORPORATION ( S& P)- One of the three best known rating agencies in the United States, the others being Moody' s Investment Service, Inc. ( Moody' s), and Fitch IBCA, Inc. ( Fitch).

SWAP - Trading one asset for another.

TOTAL RETURN - The sum of all investment income plus changes in the capital value of the portfolio. For mutual funds, return on an investment is composed of share price appreciation plus any realized dividends or capital gains. This is calculated by taking the following components during a certain time period. ( Price Appreciation) + ( Dividends paid) + ( Capital gains) = Total Return.

TREASURY BILLS- Sh01i- te1m U.S. government non- interest bearing debt securities with maturities ofno longer than one year and issued in minimum denominations of $10,000.

Auctions ofthree- and six- month bills are weekly, while auctions ofone- year bills are monthly.

The yields on these bills are monitored closely in the money markets for signs of interest rate trends.
21 PolicyB- 11
63 TREASURY NOTES - Intermediate U.S. government debt securities with maturities of one to 10 years and issued in denominations ranging from $ 1,000 to $1 million or more.

TREASURY BONDS - Long- term U.S. government debt securities with maturities of ten years or longer and issued in minimum denominations of $1,000. Currently, the longest outstanding maturity for such securities is 30 years.

VOLATILITY - A degree of fluctuation in the price and valuation of securities.

WEIGHTED AVERA GE MATURITY ( WAM) - The average maturity of all the securities that comprise a portfolio. According to SEC rule 2a- 7, the WAM for SEC registered money market mutual funds may not exceed 90 days and no one security may have a maturity that exceeds 397 days.

WHEN ISSUED ( WI) - A conditional transaction in which an authorized new security has not been issued. All "when issued" transactions are settled when the actual security is issued.

YIELD - The current rate of return on an investment security generally expressed as a percentage of the security' s current price.

YIELD- TO- CALL (YTC) - The rate ofreturn an investor earns from a bond assuming the bond is redeemed ( called) prior to its nominal maturity date. Yield Curve - A graphic representation that depicts the relationship at a given point in time between yields and maturity for bonds that are identical in every way except maturity. A nonnal yield curve may be alternatively referred to as a positive yield curve.

YIELD- TO- MATURITY - The rate of return yielded by a debt security held to maturity when both interest payments and the investor' s potential capital gain or loss are included in the calculation of return.

ZERO- COUPON SECURITIES - Security that is issued at a discount and makes no periodic interest payments. The rate of return consists of a gradual accretion of the principal of the security and is payable at par upon maturity.
22 PolicyB- 11
64 AMENDMENT NO. 1 TO AGREEMENT FOR CONTRACT SERVICES
(C01179) FOR ENVIRONMENTAL CLEAN-UP, ABATEMENT AND

BUILDING DEMOLITION, REPPLIER PARK BETWEEN THE CITY OF
BANNING AND ATI RESTORATION, LLC.

THIS AMENDMENT NO. 1 TO THE AGREEMENT FOR CONTRACT
SERVICES (“Amendment No. 1”) is entered into by and between the CITY OF BANNING (“CITY”) and ATI RESTORATION, LLC. (“Contractor”) is effective as of this day:
_______________.

RECITALS
A. City and Contractor entered into that certain Contract dated August 20, 2025 for the purpose of providing environmental clean-up, abatement, and building demolition Services (“Agreement”) for the emergency Repplier Park fire-damaged structure project, pursuant to a sole source procurement authorized by City Council Resolution No. 2025-122.

B. During the course of performing the Services, Contractor provided additional services, which were reviewed and approved by the City, including but not limited to: (i) removal of hazardous sidewalk conditions that posed an immediate public safety risk if left in place; and (ii) additional asbestos testing and remediation beyond the original scope of work.

C. City and Contractor now desire to amend the Agreement to compensate Contractor for such additional services and to increase the Contract Sum by Twenty-Three Thousand Three Hundred Thirty-One Dollars and Forty-Seven Cents ($23,331.47), for a total notto-exceed amount of Five Hundred Seventeen Thousand Eight Hundred Thirty-One Dollars & Forty-Seven Cents ($517,831.47).

D. This Amendment No. 1 is made in compliance with the City of Banning Procurement Policies & Procedures B-30, Section 16-107(2)(B), as the increase does not exceed ten percent (10%) of the total contract amount or Twenty-Five Thousand Dollars ($25,000), whichever is less.

The Parties therefore agree follows:

1. Amended Terms. The Agreement is hereby amended as follows:

1.1 The maximum compensation for the Services performed pursuant to this Amendment No. 1 shall not exceed Twenty-Three Thousand Three Hundred Thirty-One Dollars & Forty-Seven Cents ($23,331.47) thereby increasing the Contract Sum, as set forth in Section 3 of the Agreement, to Five Hundred Docusign Envelope ID: 8D74D908-41C6-8E14-818B-1063DD6BFD1C 5/12/2026
100965
Seventeen Thousand Eight Hundred Thirty-One Dollars & Forty-Seven Cents ($517,831.47).

2. Additional Services Justification. The Parties acknowledge that the additional compensation provided under this Amendment No. 1 is for necessary and unforeseen work required to safely complete the Project, including, without limitation, hazardous sidewalk removals and additional asbestos testing and remediation. Such work was authorized by the City in accordance with the Contract Documents and applicable City procedures. In consideration for the additional compensation set forth herein, Contractor has performed, and agrees to perform, such additional services, which constitute extra work beyond the original scope of the Agreement.

3. Miscellaneous Provisions

3.1 Continued Effect of Agreement. Except as amended by this Amendment No. 1, all provisions of the Agreement shall remain unchanged and in full force and effect. From and after the date of this Amendment No. 1, whenever the term “Agreement” appears in the Agreement, it shall mean the Agreement, as amended by Amendment No. 1. In the event of a conflict between the provisions of this Amendment No. 1 and the provisions of the Agreement, the provisions of this Amendment No. 1 shall control.

3.2 Consideration for Amendment. The parties hereby agree that they have each received adequate and independent consideration for the modifications to the Agreement set forth in this Amendment No. 1.

3.3 Authority. The persons executing this Amendment No. 1 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 Amendment No. 1 on behalf of said party, (iii) by so executing this Amendment No. 1, such party is formally bound to the provisions of this Amendment No. 1, and (iv) entering into this Amendment No. 1 does not violate any provision of any other agreement to which said party is bound.

3.4 Counterparts. This Amendment No. 1 may be signed in any number of counterparts, each of which will be an original, but all of which together will constitute one instrument.

3.5 Electronic Signatures. Each Party may adopt as its signature an electronic identification consisting of a symbol or code that is affixed to or contained in each document transmitted by such Party (“electronic signature”). The Parties hereto herby agree that electronic signatures are acceptable, shall have the same force and effect under the law as original wet signatures, and shall be sufficient to verify that the Parties have executed this Agreement and such other documents transmitted by the Parties.
[SIGNATURE PAGE FOLLOWS]
Docusign Envelope ID: 8D74D908-41C6-8E14-818B-1063DD6BFD1C 101066
The Parties are signing this Amendment No. 1 on the date stated in the introductory clause.

CITY OF BANNING CONTRACTOR
Elizabeth Gibbs,
City Manager
NAME:

TITLE:

City Council Approval: _______________ NAME:

TITLE:

ATTEST:

Sandra B. Calderon
Deputy City Clerk
APPROVED AS TO FORM:

Slovak Baron Empey Murphy & Pinkney
John Pinkney
City Attorney
NOTE: PROOF OF AUTHORITY TO BIND CONTRACTING PARTY REQUIRED.

APPROPRIATE ATTESTATIONS SHALL BE INCLUDED AS MAY BE REQUIRED BY THE

BYLAWS, ARTICLES OF INCORPORATION, OR OTHER RULES OR REGULATIONS APPLICABLE TO CONTRACTOR’S BUSINESS ENTITY.

Docusign Envelope ID: 8D74D908-41C6-8E14-818B-1063DD6BFD1C Sean Wisdom
Regional Vice President of Operations
N/A
101167

CITY OF BANNING

STAFF REPORT
TO: CITY COUNCIL
FROM: Elizabeth Gibbs, City Manager
PREPARED BY: Patrick Safari, Capital Improvement Projects Manager Art Vela, Director of Public Works
MEETING DATE: July 14, 2026
SUBJECT: Public Works Capital Improvement Project Tracking List STAFF RECOMMENDATION:

Receive and file.

BACKGROUND:

To keep the City Council and the public informed of the progress and status of various capital improvement projects, staff has prepared the attached Public Works CIP Tracking List, which will be updated and presented on a monthly basis.

The tracking list includes planning, environmental, design, and construction contracts previously approved by the City Council and/or the City Manager’s Office and currently managed by the Public Works Department.

JUSTIFICATION:

This recurring item is provided to keep the City Council and public apprised of the progress on certain projects.

FISCAL IMPACT:

Not applicable.

ATTACHMENTS:

1. CIP Tracking Sheet_June 2026.pdf
68 Category Project # Project Name Phase % Completed Tasks Completed Current Tasks Future Tasks Tentative Completion Date Project Budget Streets 2023-17 Hargrave Grade Separation PA&ED 18% Contract execution; project kickoff, grant reporting.
35% Caltrans Submittal; 10% UPRR
Approval; FRA RCE Grant Application
65% UPRR Submittal, Environmental
Assessments
12/31/27 $ 8,300,000
Streets - Highland Springs Avenue
Interchange
PA&ED 40% Highway Safety Manual segmentation existing
condition; aerial topo mapping; traffic volume
report; Environmental Purpose/Need
Statement; Air/Noise memos; VMT
Methodology Memo; DDI Exclusion Memo;
ROW Data Sheets;
Revised noise studies for new alternate,
updated technical studies
Design Standard Risk Assessment;
Value Analysis Report; Geometric
Approval Document; R/W Data Sheets;
Transp. Management Plan
12/31/27 $ 2,900,000
Streets 2020-04 Sun Lakes Blvd Extension CEQA, PS&E 99% Obtained environmental permits, complted PSE package.

Construction support Complete environmental mitigations 12/1/26 $ 1,248,026 Streets 2020-04 Sun Lakes Blvd Extension Construction 5% Construction project public advertising Contractor performing clearing and grubbing the whole site. Installation of
safety fence around Kinder Morgan
Pipeline
Begin Kinder Morgan Relocation and
Construction of the Reinforced
Concrete Boxes at the Smith Creek
crossings
7/30/27 $ 20,996,793
Streets - Traffic Signalization of 8th
Street/I-10 Interchange
Design/Permits 90% Design well underway. Submittal of
encroachment permit application to Caltrans.

Caltrans approval on TOAR and concepts.

Design paused, due to rephase of RSG
project and property acquisition needs
Resubmitted to Caltrans if needed.

Caltrans encroachment permit
issuance. Property acquisition (private
party task)
9/30/26 $ 1,081,000
Streets 2023-04 HSIP Cycle 10 Ramsey Street
Pedestrian Safety Improvements
Construction 95% Project Approved for Funding by the State.

Project Awarded.

Construction is substantially completed.

Waiting on long lead items such as street
lights and
Pre-Construction review meeting with
Caltrans.
7/30/26 $ 596,850
Streets 2023-09 HSIP Upgrade 17 Traffic Signals
Hardware
PS&E 90% Project approved for funding by Caltrans STC Traffic Working on 90% Plans Submittal and Caltrans EP Approval
100% Plans Submittal and Approval 12/30/26 $ 74,760
Streets 2023-10 HSIP Pedestrian Crossings
Upgrades at 19 Intersection
PS&E 90% Project approved for funding by Caltrans Consultant working on 100% plans, specs and cost estimate
100% plan submittal city review 6/30/26 $ 86,075
Streets 2023-11 HSIP Wilson St & 12 St
Intersection Upgrade
PS&E 90% Project approved for funding by Caltrans Consultant working on on 100% plans, specs and cost estimate
100% plan submittal city review 9/30/26 $ 41,665
Streets 2023-05 San Gorgonio/UPRR Pedestrian
Crossing
Design 95% Amendment 2 CC Approval. 65% Plans
complete
Final Plans approved by UPRR, CUPC
and Caltrans. C&M Agreement Draft
Approve C&M Agreement. Prepare Bid
Documents
8/30/26 $ 230,000
Facility 2021-06 CNG Station Design-Build 100% Project is now substantially complete. Project is now substantially complete. Completion of final punchlist items.

Notice of Completion
7/15/26 $ 4,888,261
Facility City Hall Roof Repairs - Phase 2 Design/Bid 10% Scope identification - Roof/leak repairs on flat roof section over remainder of City Hall
Preparation of RFP Award, Construction 10/31/26 $ 275,000 Facility 2024-02 City Hall HVAC Replacement Construction 1% Bid and award of contract Finalize contracts Construction 8/1/26 $ 188,000 Water 2018-02W2 New Domestic Water Well C8 (Phase 2: Well Equipping and Site Development)
Construction 80% Installed pump, above-ground piping, pump-towaste, louvers, doors, CMU block. Completed curb, gutter, asphalt paving, drainage swale.

Finish roofing and truss system, Exterior
finishes, Paint and coating
MCC, switchboard, VFD, Transfer
switch, generator, start-up, O&M
manuals, testing and training
9/1/26 $ 3,774,100
Water 2022-07W Well M12A (Phase 2: Well
Equipping an Site Development)
Construction 95% Installed pump, above-ground piping, pump-towaste, louvers, doors, CMU block, electrical units, testing, disinfection, Slurry seal asphalt
Pump efficiency testing O&M manuals and training, completion of final punchlist items. Notice of
completion
7/30/26 $ 2,684,990
Wastewater 2022-
01WW
Wastewater Treatment Plant and
Recycled Water Improvements
Phase 1
(Design)
30% Received 10% BODR (Basis Of Design Report). Off-ramping current Design Build contract, preparing an RFP for alternative delivery
Advertise and award RFP for
alternative design.
8/1/27 $ 4,398,490
Wastewater 2020-
08WW
WWTP Equalization Basin Design/CEQA 100% Finalized 100% drawings, ~$1.25M EPA Community Grant has been issued
Advertising IFB Award, Construction 8/1/26 $ 362,866
Recycled
Water
2024-1RW Charles Street and Lincoln Street
Booster Station and Reservoirs
Construction 95% Project was awarded, a NTP was issued
followed by pre-con meeting and submittal
reviews.

Installation of PLCs for SCADA. Start up 8/30/26 $ 10,160,200 Recycled
Water
2023-
06RW
Lions Park Non-Potable Water
Conversion
Construction 100% Project Awarded. Kick Off Meeting. Surveying and utility research
Release Retention Warranty Period 7/30/26 $ 920,672
Electric Sun Lakes Blvd Extension Construction 2% Application for SCE relocation work is complete.

SCE joint trench plan estimated to be complete
in August 2026.

Construction started on May 11.

Contractor on site for clearing and
grubbing whole site including potholing all
utilities
Begin construction of concrete box
culverts on the east side
7/30/27 $ 2,366,090
Electric Robertson's Ready Mix Pole
Relocation
PS&E 95% Line Extension Agreement approved by City
Council. Additional comments provided by
Robertson's Ready Mix
Update agreement and resubmit for City
Council approval
Collect deposits from Robertson's
Ready Mix and order materials for
construction and schedule installation
12/30/26 $ 425,000

PUBLIC WORKS CAPITAL IMPROVEMENT PROJECTS (CIP) TRACKING SHEET 69 Electric 12kV Reconductor on Barbour St
at Hathaway
PS&E 95% Alternative plan to address replacement of 4kV equipment at the site has been approved.

Negotiate cost sharing with property
owners at 700 S Hathaway St for reduced
scope of work for completing necessary
upgrades to replace all 4kV equipment
with 12kV equipment.

Current construction estimate is
$125,000 and has been added to the
FY 2026/27 budget.
3/31/27 $ 125,000
Electric Mias Canyon Line Hardening Design/MSHC
P
100% Line hardeining redesign completed. MSHCP
Consistency Analysis has been completed and
submitted to USFW/FEMA/CDFW/CalOES for
review.

Coordinate with Riverside County and
other participating jurisdictions to confirm
incorporations of measures for consistency
with the MSHCP.

Await determination on approval of
federal grant funding and match
funding thru CalOES
12/30/27 $ 2,189,140
Electric 34.5kV Circuit Reroute Construction 65% 16 of 26 poles have been replaced. Installation is being completed by BEU linemen.

Make adjustments for 2026/27 budget
cycle to include funding for this project.

Schedule construction for remaining poles
Complete installation of remaining
poles and re-energize subtransmission Circuit #1.
12/30/26 $ 275,000
70 CITY OF BANNING

STAFF REPORT
TO: CITY COUNCIL
FROM: Elizabeth Gibbs, City Manager
PREPARED BY: Mary Yaryan, Senior Planner
MEETING DATE: July 14, 2026
SUBJECT: Consideration of Second Reading and Adoption of Ordinance No. 1624, Zoning Text Amendment PZTA 26-0001(Accessory Dwelling Units and Junior Accessory Dwelling Units).

STAFF RECOMMENDATION:

Approve Second Reading and Adoption of Ordinance No. 1624 BACKGROUND:

The Planning Department initiated Zoning Text Amendment PZTA26-0001 to repeal and replace Section

17.08.100 (Accessory Dwelling Unit Standards) of the Banning Municipal Code and amend related sections of Title 17 to ensure consistency with current State law governing accessory dwelling units (“ADUs”) and junior accessory dwelling units (“JADUs”). The City Council reviewed and approved the 1 st
reading of Ordinance No. 1624 at its June 9, 2026 meeting. It would be appropriate at this time for Council to approve the 2
nd
reading and approve Ordinance No. 1624 for PZTA 26-0001.

JUSTIFICATION:

N/A
FISCAL IMPACT:

N/A
ATTACHMENTS:

1. Attach_A_-_Ordinance_No._1624__PZTA26-0001_ADU-JADU.docx 71 ATTACHMENT A
City Council Ordinance No. 1624
72 ORDINANCE NO. 1624

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BANNING, CALIFORNIA, DETERMINING THAT ZONING TEXT AMENDMENT NO. 2026-0001 IS EXEMPT

FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) PURSUANT TO PUBLIC RESOURCES CODE SECTION 21080.17 AND CEQA GUIDELINES SECTION 15282(H) AND APPROVING ZONING TEXT AMENDMENT 26-0001 TO AMEND SECTIONS 17.04.070 (DEFINITIONS), 17.08.050 (ACCESSORY STRUCTURES),

17.08.100 (ACCESSORY DWELLING UNIT STANDARDS), 17.08.250 (SINGLEFAMILY ARCHITECTURE), AND 17.12.190 (MULTI-FAMILY ARCHITECTURE) OF

THE BANNING MUNICIPAL CODE RELATING TO ACCESSORY DWELLING UNITS

AND JUNIOR ACCESSORY DWELLING UNITS
WHEREAS, Section 17.116.010 ("Purpose") of the Banning Municipal Code ("BMC") provides that the City Council may amend the provisions of the Zoning Ordinance (BMC Title 17) for the public health, environmental protection, safety, general welfare, and the aesthetic harmony of the City; and
WHEREAS, BMC Section 17.116.020 further provides that amendments to the Zoning Ordinance may be proposed by the Community Development Director, the City Attorney, members of the Planning Commission or City Council, and any landowner or his or her agent; and
WHEREAS, Section 17.08.100 of the Banning Municipal Code currently regulates accessory dwelling units and junior accessory dwelling units; and WHEREAS, the California Department of Housing and Community Development ("HCD") issued a December 5, 2025 Letter of Technical Assistance advising that the City’s most recent ADU ordinance on file is from 2020 and may be outdated and out of compliance with State ADU Law due to numerous statutory changes since adoption; and WHEREAS, HCD recommended that the City repeal the outdated ordinance and adopt an amended, compliant ordinance in order to provide clarity to ADU applicants and ensure consistency with current State law; and
WHEREAS, the proposed amendment repeals, in its entirety, existing Section

17.08.100 and adopts a new Section 17.08.100 to implement Chapter 13 (commencing with Section 66310) of Division 1 of Title 7 of the Government Code, as amended, and to establish objective ministerial standards for accessory dwelling units and junior accessory dwelling units; and
WHEREAS, the new Section 17.08.100 includes provisions addressing purpose and intent, applicability, definitions, types of units allowed, process and review procedures, rental terms, occupancy and ownership, development standards, development standard exemptions, by-right permitting exemptions, utility and fee requirements and limitations, and State law supremacy; and 73 WHEREAS, the proposed amendment to Section 17.04.070 is limited to those definitions directly affected by the repeal and replacement of Section 17.08.100 and is intended to align accessory dwelling unit and junior accessory dwelling unit terminology with applicable State law; and
WHEREAS, the proposed amendment to Section 17.08.050 clarifies that accessory dwelling units and junior accessory dwelling units are regulated under Section

17.08.100 and applicable State law, and not under the general accessory structure standards; and
WHEREAS, the proposed amendments to Sections 17.08.250 and 17.12.190 clarify that accessory dwelling units and junior accessory dwelling units are subject to ministerial review under Section 17.08.100 and applicable State law and are not subject to discretionary architectural review or subjective compatibility findings to the extent prohibited by State law; and
WHEREAS, the proposed amendments update local regulations to address changes identified by HCD, including but not limited to the prohibition on deed restrictions for ADUs, the prohibition on third-party approval requirements such as HOA review, the prohibition on requiring parking for JADUs, revised JADU owner-occupancy rules tied to shared sanitation facilities, JADU rental terms longer than 30 days, 15-business-day completeness review requirements, written incompleteness notices, appeal procedures, revised impact fee limitations, and updated size and processing requirements under State law; and
WHEREAS, the City Council finds that the amendments set forth herein promote internal consistency within Title 17 and facilitate lawful implementation of State accessory dwelling unit requirements; and
WHEREAS, on March 4, 2026, the Planning Commission considered Discussion Item No. 5.1, a City-initiated Zoning Text Amendment (PZTA26-0001) to repeal and replace Section 17.08.100 (Accessory Dwelling Units) and amend related sections of Title 17 of the Banning Zoning Ordinance to ensure consistency with State law, and provided direction to staff regarding revisions prior to scheduling a duly noticed public hearing for consideration of and action by the City Council; and
WHEREAS, in accordance with BMC Chapter 17.116 (“Zoning Ordinance Amendments”), Section 17.116.030 and Government Code Sections 65090 and 65091, on April 24, 2026, the City gave public notice, by advertisement in the Record Gazette, a newspaper of general circulation within the City of Banning, of a public hearing at which the proposed Zoning Text Amendment would be considered by the Planning Commission; and
WHEREAS, on May 6, 2026, the Planning Commission held a duly noticed public hearing at which interested persons had an opportunity to testify in support of, or opposition to, proposed Zoning Text Amendment No. PZTA26-0001, and, at the 74 conclusion of the public hearing, recommended that the City Council adopt the proposed ordinance by Planning Commission Resolution No. 2026-01; and WHEREAS, in accordance with BMC Chapter 17.116 ("Zoning Ordinance Amendments"), Section 17.116.040 and Government Code Section 65090, on May 29, 2026, the City gave public notice, by advertisement in the Record Gazette, a newspaper of general circulation within the City of Banning, of a public hearing at which the proposed Zoning Text Amendment would be considered by the City Council; and WHEREAS, on June 9, 2026, the City Council held a duly noticed public hearing at which interested persons had an opportunity to testify in support of, or opposition to, proposed Zoning Text Amendment No. PZTA26-0001; and
WHEREAS, all other prerequisites to the adoption of this Ordinance have been satisfied.

NOW THERFORE BE IT ORDAINED by the City Council of the City of Banning, Riverside County, State of California as follows:

SECTION 1. CEQA DETERMINATION
The City Council of the City of Banning, based upon the recommendation of the Planning Commission and in accordance with BMC Section 17.116.050, finds as follows:

A. California Environmental Quality Act (CEQA). The Planning Commission has determined that the proposed Zoning Text Amendment No. 2026-0001 (the “Project”) is exempt from the requirements of the California Environmental Quality Act (“CEQA”) and the City’s CEQA Guidelines pursuant to Public Resources Code Section 21080.17 and CEQA Guidelines Section 15282(h), which provide that the adoption of an ordinance by a city regarding accessory dwelling units and junior accessory dwelling units to implement State law is statutorily exempt from CEQA.

The City Council has independently reviewed the Planning Commission’s recommendation and staff’s determination of exemption from CEQA and based on its own independent judgment, determines that the Project is statutorily exempt from CEQA.

B. Multi-Species Habitat Conservation Plan (MSHCP). The proposed Zoning Text Amendment does not relate to any one physical project and is not subject to MSHCP.

SECTION 2. FINDINGS
In accordance with Section 17.116.050 of the Banning Zoning Ordinance, the City Council, upon recommendation of the Planning Commission, in light of the whole record before it, including but not limited to the Planning Department’s staff report and all documents incorporated by reference herein, the City’s General Plan and any other 75 evidence within the record or provided at the public hearing of this matter, finds and determines as follows:

A. The proposed Amendment is consistent with the goals and policies of the General Plan.

Evidence: The residential goals of the General Plan encourage the preservation and enhancement of the City’s neighborhoods through a broad range of housing types to meet the needs of current and future residents. Residential Policy 1 provides for a range of housing densities while considering land use compatibility. Policy 6 of the Community Development Element recognizes the need for creative and flexible design standards for residential development, including clustered housing units. The proposed amendment supports these goals and policies by updating the City’s regulations for accessory dwelling units and junior accessory dwelling units to ensure consistency with State law and to facilitate additional residential housing opportunities. Accordingly, the proposed amendment is consistent with the General Plan.

B. The proposed Amendment is internally consistent with the Zoning Ordinance.

Evidence: The proposed Zoning Text Amendment No. 2026-0001 is internally consistent with the Zoning Ordinance. The proposed amendment is consistent with the purpose and objective of the Zoning Ordinance (Title 17) to ensure orderly development of uses and lands within the city to protect the public health, safety, and welfare. With approval of the proposed Zoning Text Amendment, the amendment will be internally consistent with the Zoning Ordinance and California State law regarding ADUs and JADUs.

C. The City Council has independently reviewed and considered the requirements of the California Environmental Quality Act (“CEQA”).

Evidence: Approval of Zoning Text Amendment No. 2026-0001 is statutorily exempt from the California Environmental Quality Act (“CEQA”) pursuant to Public Resources Code Section 21080.17 and CEQA Guidelines Section 15282(h). Based on its independent review, the City Council, based on the Planning Commission’s recommendation, hereby finds that this statutory exemption from CEQA applies to approval of Zoning Text Amendment No. 26-0001.

SECTION 3. CODE AMENDMENT
Section 17.04.070 (“Definitions”) of the Banning Municipal Code is hereby amended to revise the following definitions as follows:

Accessory Dwelling Unit or ADU is an attached or a detached residential dwelling unit that provides complete independent living facilities for one or more persons, including permanent provisions for living, sleeping, eating, cooking, and sanitation, and that is 76 located on the same lot as a proposed or existing primary dwelling. An accessory dwelling unit shall not be considered to exceed the allowable density for the lot and shall be deemed a residential use that is consistent with the existing General Plan and zoning designation for the lot. An accessory dwelling unit may include an efficiency unit, as defined in Section 17958.1 of the Health and Safety Code, and a manufactured home, as defined in Section 18007 of the Health and Safety Code.

Accessory or Ancillary Use or Structure is a subordinate use or structure, the use of which is clearly incidental and related to that of the principal structure or use of the land, which is located on the same lot as that of the principal structure or use. Accessory structures are not dwelling units and are not intended for independent living facilities.

Dwelling Unit, Accessory (Accessory Dwelling Unit/ADU) shall have the same meaning as “Accessory Dwelling Unit” above. Where inconsistent, the definition set forth in Government Code Section 66313 shall control.

Existing Primary Dwelling is a legally permitted and existing primary dwelling on a lot, including a single-family dwelling or a multifamily dwelling.

Junior Accessory Dwelling Unit or JADU is a unit that is no more than five hundred square feet of interior livable space in size and contained entirely within a single-family residence. A junior accessory dwelling unit may include separate sanitation facilities or may share sanitation facilities with the existing structure.

Livable space is a space in a dwelling intended for human habitation, including living, sleeping, eating, cooking, or sanitation.

Primary Unit or dwelling is the principal proposed or existing residential dwelling on a lot and may consist of a single-family dwelling or a multifamily dwelling.

Proposed dwelling means the principal proposed or existing residential dwelling on a lot and may consist of a single-family dwelling or a multifamily dwelling.

Proposed primary dwelling is a proposed primary dwelling on a lot that is the subject of an active building permit application, or that has received building permit approval but has not yet received a certificate of occupancy and may consist of a single-family dwelling or a multifamily dwelling.

SECTION 4. CODE AMENDEMENT
Section 17.08.050 (“Accessory structures”) of the Banning Municipal Code is hereby amended to add the following:

This section applies to accessory structures that are not “accessory dwelling units” or “junior accessory dwelling units.” Accessory dwelling units (ADUs) and junior accessory dwelling units (JADUs) shall be regulated solely under Section 17.08.100 and applicable provisions of Chapter 13 of Division 1 of Title 7 of the Government Code (commencing 77 with Section 66310). To the extent this section conflicts with State ADU/JADU law, State law controls.

SECTION 5. CODE AMENDEMENT
Section 17.08.100 (“Accessory dwelling unit standards”) of the Banning Municipal Code is hereby repealed in its entirety and replaced with a new section to read as follows:

17.08.100 Accessory dwelling unit standards.

A. Purpose and Intent. This Section implements Chapter 13 of Division I of Title 7 of the Government Code (Government Code sections 66310-66342), as amended, and establishes objective, ministerial standards for accessory dwelling units (ADUs) and junior accessory dwelling units (JADUs). This Section shall be interpreted to provide the maximum allowance required by State law.

B. Applicability. This Section applies to ADUs and JADUs on lots with proposed or existing residential development were permitted by State law, including single-family and multifamily contexts as applicable.

1. ADU/JADU permit review shall be ministerial and non-discretionary. No conditional use permit, variance, public hearing, or other discretionary entitlement shall be required unless expressly authorized by State law.

2. No local standard, policy, condition, deed restriction, or third-party approval requirement may be imposed if prohibited by State law.

C. The definitions in this Article are intended to supplement Chapter 13 of Division 1 of Title 7 of the Government Code (commencing with Section 66310). If a conflict exists between this Article and Chapter 13 of Division 1 of Title 7 of the Government Code (commencing with Section 66310), State law shall control. Local definitions shall be interpreted in a manner consistent with Chapter 13 of Division 1 of Title 7 of the Government Code and shall not be applied to reduce rights provided by State law. For purposes of this Article:

1. “Accessory dwelling unit” or ADU is an attached or detached residential dwelling unit that provides complete independent living facilities for one or more persons, including permanent provisions for living, sleeping, eating, cooking, and sanitation, and that is located on the same lot as a proposed or existing primary dwelling. An accessory dwelling unit shall not be considered to exceed the allowable density for the lot and shall be deemed a residential use that is consistent with the existing General Plan and zoning designation for the lot. An accessory dwelling unit may include an efficiency unit, as defined in Section 17958.1 of the Health and Safety Code, and a manufactured home, as defined in Section 18007 of the Health and Safety Code.
78 2. “Existing primary dwelling” is a legally permitted and existing primary dwelling unit on a lot, including a single-family or a multifamily dwelling.

3. “Junior Accessory Dwelling Unit” or JADU is a unit that is no more than five hundred square feet of interior livable space in size and contained entirely within a single-family residence. A junior accessory dwelling unit may include separate sanitation facilities or may share sanitation facilities with the existing structure.

4. “Livable space” is a space in a dwelling intended for human habitation, including living, sleeping, eating, cooking, or sanitation.

5. “Primary dwelling” is the principal proposed or existing residential dwelling on a lot and may consist of a single-family dwelling or a multifamily dwelling.

6. “Proposed dwelling” means the principal proposed or existing residential dwelling on a lot and may consist of a single-family dwelling or a multifamily dwelling.

7. “Proposed primary dwelling” is a proposed primary dwelling on a lot that is the subject of an active building permit application, or that has received building permit approval but has not yet received certificate of occupancy and may consist of a single-family dwelling or multifamily dwelling.

C. Types of Units Allowed.

1. Accessory Dwelling Units on Single-Family Lots. The following types of accessory dwelling units are authorized on a lot where allowed in compliance with Division II (Land Use Districts) of this Zoning Code. a. Attached Unit. An accessory dwelling unit that structurally abuts and is attached to an existing or proposed primary dwelling. An attached unit may be constructed on the side, top, or below the existing or proposed primary dwelling.

2. Detached Unit. An accessory dwelling unit that is physically separated from the existing or proposed primary dwelling. A detached accessory dwelling unit shall be deemed the primary dwelling if its floor area exceeds that of the existing primary dwelling.

3. Converted Existing Structure or Space. An accessory dwelling unit that is created from an existing space within an existing or proposed primary dwelling (e.g., basement, attic, attached garage, storage area, or similar area) or an existing space of an accessory structure (e.g., detached garage, shed, storage structure, or other similar existing accessory structure) on the same lot as the primary dwelling. This may include an existing primary dwelling that is converted to an accessory dwelling unit when a larger primary dwelling is established, though the converted dwelling shall still be limited in size to 1,200 square feet. 79 4. Junior Accessory Dwelling Unit on a Single-Family Lot. A junior accessory dwelling unit contained entirely within the walls of an existing or proposed singlefamily residence.

5. Multifamily Accessory Dwelling Unit. An accessory dwelling unit that may be allowed on a lot zoned for multifamily residence and is either attached, detached, or located within the portions of an existing multifamily dwelling that are not used as livable space (e.g., storage rooms, boiler rooms, passageways, attics, basements, garages).

D. Process and Review Procedures.

1. Ministerial Review. A permit for an accessory dwelling unit or junior accessory dwelling unit is considered and approved ministerially, without discretionary review or hearing, notwithstanding the need for a variance or special use permit.

2. Processing Times. Within fifteen (15) business days after receipt of an application to create or convert an accessory dwelling unit or junior accessory dwelling unit, the Department shall determine whether the application is complete and provide written notice of that determination. If the Department determines that an application is incomplete, the written notice shall include a list of the incomplete items, and a description of how the application can be made complete. After an applicant resubmits materials to cure incompleteness, the Department shall determine completeness within fifteen (15) business days. In reviewing the resubmittal, the Department shall not require any item that was not identified in the prior incompleteness notice. If the Department does not make a timely completeness determination under this subsection, the application or resubmitted application shall be deemed complete for purposes of this Section.

The Department shall approve or deny a complete application within sixty (60) days of receipt of the complete application when there is an existing single-family or multifamily dwelling on the lot. If an ADU or JADU application is submitted concurrently with an application for a new primary dwelling or new multifamily dwelling on the same lot, the Department may delay approving or denying the ADU or JADU application until action is taken on the primary dwelling or multifamily dwelling application; however, review of the ADU or JADU application shall remain ministerial and non-discretionary. If the Department does not approve or deny a complete application within the applicable time period, the application shall be deemed approved, except to the extent State law provides otherwise. If the Department denies an application, it shall provide a written denial within the applicable time period, including a full list of defective or deficient items and a description of how the application may be remedied. The City shall provide a written appeal process for completeness determinations and denials. A final written appeal decision shall be issued within sixty (60) business days after receipt of a written appeal.
80 a. Pre-Approved Plans. The Community Development Director or designee, in consultation with the Building Official, shall adopt and maintain a preapproved building plan for a detached accessory dwelling unit consistent with the current triennial California Building Standards Code rulemaking cycle.

The preapproved plan, along with the contact information of an applicant that obtained approval of an accessory dwelling unit using a pre-approved plan, shall be posted on the Department’s website in accordance with Section 65852.27 of the Government Code.
i. An application for a detached accessory dwelling unit that utilizes a preapproved plan adopted by the Community Development Director or designee within the current triennial California Building Standards Code rulemaking cycle, or a plan identical to a plan approved by the Community Development Director or designee within the current triennial California Building Standards Code rulemaking cycle, shall be ministerially approved or denied within thirty (30) days of the date the Department receives a complete application.
ii. An applicant shall pay the same permitting fees that the City charges an applicant seeking approval for the same-sized accessory dwelling unit when reviewing and approving the submission of a pre-approved accessory dwelling unit plan.

3. Nonconforming Conditions. The Department shall not require, as a condition of ministerial approval of an ADU or JADU permit, correction of nonconforming zoning conditions. The Department shall not deny an application due to correction of nonconforming zoning conditions, building code violations, or unpermitted structures that do not present a threat to public health and safety and are not affected by the construction of the ADU or JADU. Notwithstanding the foregoing, the Building Official may require correction of a condition, or deny the application, only upon a written determination, supported by substantial evidence in the record, that correction is necessary to comply with applicable health and safety standards, including but not limited to Health and Safety Code Section 17920.3, or that the condition is directly affected by the proposed ADU/JADU construction. Any such determination shall identify the specific code section(s), the condition creating the risk, and the minimum corrective action required.

4. Unpermitted Junior and Accessory Dwelling Units. The Department shall not deny a permit for an unpermitted ADU or JADU built on or before January 1, 2020, due solely to violations identified in Government Code Section 66311.7, subdivision (a). Notwithstanding the foregoing, the Department may deny the permit if it makes a finding that correction is necessary to comply with Health and Safety Code Section 17920.3. This subsection does not apply to a building deemed substandard pursuant to Health and Safety Code Section 81 17920.3. The City shall provide public information resources, including permit checklists and the City website, that include:
a. a checklist of conditions in Health and Safety Code Section 17920.3 that may deem a building substandard; and
b. notice that a homeowner may obtain a confidential third-party code inspection from a licensed contractor before submitting a permit application.

The City shall not penalize an applicant for having such unpermitted unit and shall approve permits necessary to correct noncompliance with health and safety standards.

5. Legal Nonconforming Accessory Dwelling Unit. The expansion of a legal nonconforming structure or use associated with an accessory dwelling unit shall be subject to the provisions of Division II (Land Use Districts) and Section 17.88 (Non-Conforming Structures and Non-Conforming Uses) of this Zoning Code.

6. Sewer. Subject to objective health and safety standards and applicable State law, written confirmation from the sewer district having jurisdiction of the availability of sewer service for the accessory dwelling unit or junior accessory dwelling unit, or written approval from Environmental Health Services for use on an existing or new septic system, shall be obtained prior to the issuance of a permit for the creation of an accessory dwelling unit or junior accessory dwelling unit. Holding tanks shall not be permitted for an accessory dwelling unit or junior accessory dwelling unit.

7. Water. Subject to objective health and safety standards and applicable State law, written confirmation from the water district having jurisdiction of the availability of water service for the accessory dwelling unit or junior accessory dwelling unit, or written approval from Environmental Health Services for use of an existing or new well, shall be obtained prior to the issuance of a permit for the creation of an accessory dwelling unit or junior accessory dwelling unit.

8. Fire and Life Safety. Accessory dwelling units and junior accessory dwelling units shall comply with applicable State law and applicable fire and life-safety requirements of the California Building Standards Code, as adopted by the City, except as otherwise provided by Chapter 13 of Division 1 of Title 7 of the Government Code (commencing with Section 66310).

9. Site Drainage and Access. Accessory dwelling units and junior accessory dwelling units shall comply with applicable objective requirements of this Code and other applicable law relating to site drainage and safe access.

10.Garage Demolitions. Review and issuance of a demolition permit for a detached garage that is to be replaced with an accessory dwelling unit shall be reviewed and 82 issued at the same time with the application for the creation of an accessory dwelling unit.

11.Flood Protection. An accessory dwelling unit or junior accessory dwelling unit located within a floodplain safety overlay shall comply with Chapter 82.14 (Floodplain Safety Overlay), including but not limited to elevating the lowest finished floor to the required elevation.

12.Local Building Code. Accessory dwelling units shall comply with applicable local building code requirements that apply to detached dwellings. The construction of an accessory dwelling unit shall not constitute a Group R occupancy change under the local building code, as described in Section 310 of the California Building Code, unless the Building Official makes a written finding, based on substantial evidence in the record, that the construction of the accessory dwelling unit would have a specific, adverse impact on public health and safety. Nothing in this subsection shall be interpreted to prevent the City from changing the occupancy code of a space that was uninhabitable or was permitted only for non-residential use and is subsequently converted to residential use, consistent with State law.

F. Rental Terms, Occupancy, and Ownership.

1. Rental Terms. An accessory dwelling unit and junior accessory dwelling unit may be rented separately from the primary dwelling or multifamily dwelling in all regions of the City, subject to the following criteria:
a. Except as provided by State law, an ADU may be rented separately from the primary dwelling. Any rental of a JADU, and any ADU approved pursuant to Government Code Section 66323, shall be for a term longer than thirty (30) days.

2. Occupancy. Owner occupancy shall not be required for an accessory dwelling unit. For a junior accessory dwelling unit, owner occupancy may be required only when the junior accessory dwelling unit shares sanitation facilities with the singlefamily residence in which it is permitted. The owner may reside in either the remaining portion of the single-family residence or the junior accessory dwelling unit. Owner occupancy shall not be required if the junior accessory dwelling unit has separate sanitation facilities, or if the owner is a governmental agency, land trust, or housing organization. A deed restriction shall be recorded with the County Recorder and shall run with the land for any junior accessory dwelling unit permit.

The deed restriction shall include all of the following:
a. A prohibition on sale of the junior accessory dwelling unit separate from sale of the single-family residence, including a statement that the deed restriction is enforceable against future purchasers.
83 b. A restriction on the size and attributes of the junior accessory dwelling unit consistent with this Article and Government Code Section 66333, as amended.

3. Separate Conveyance. Separate sale or conveyance of an ADU is prohibited except as authorized by Government Code Sections 66341 and 66342.

G. Development Standards (Objective Standards).

1. Except as otherwise provided in this Article, development standards for ADUs and JADUs shall comply with Table 17.08.100, this Section, and applicable State law.

2. Land Use Zoning District Regulations. ADUs and JADUs shall comply with the objective standards set forth in this Section. Underlying zoning district standards shall apply only to the extent they do not conflict with this Section or Chapter 13 of Division 1 of Title 7 of the Government Code (commencing with Section 66310). In the event of a conflict, the provisions of this Section and applicable State law shall control.

3. State-Mandated Minimum Development Envelope. Notwithstanding any other local development standard, the City shall not impose any limit on lot coverage, floor area ratio, open space, front setback, minimum lot size, size based on percentage of the primary dwelling, or other standard that would prohibit construction of an ADU with at least 800 square feet of interior livable space and side and rear setbacks of four feet, in compliance with otherwise applicable Stateauthorized standards.

Table 17.08.100
Accessory Dwelling Unit Development Standards
ADU Development Standards1
Unit Type Multifamily ADU ADU JADU
Lot Area Dimensions
Size:

Determined by the underlying zoning district
Width:

Depth:

Maximum Width/Depth
Ratio:

Density Per Lot2
Minimum: None None None
Maximum
(Attached)
Existing: Up to 25% of
multifamily units
2 units None
Proposed: 2 units
84 Maximum
(Detached)
Existing:
8 units; Not to
exceed existing
primary unit count 2 units Not allowed
Proposed: 2 units
Maximum
(Conversion):

Up to 25% of
multifamily units3 2 units 1 unit
Unit Size4,5
Minimum: 200 square feet 200 square feet 150 square feet Maximum (Attached): 1,200 square feet6 1,200 square feet6 Not allowed Maximum (Detached): 1,200 square feet 1,200 square feet Not allowed Maximum (Conversion)7: None None 500 square feet
Setbacks8
Front: Per underlying
zone
Per underlying
zone Setbacks of the
existing structure
apply, subject to
State law
Side – Street Side: 4ft 4ft
Side – Interior: 4ft 4ft
Rear: 4ft 4ft
Detached Unit Separation: 5ft9 5ft9
Lot Coverage
Maximum Coverage: Determined by the underlying zoning district Building Height10
Maximum (Attached): 25ft 25ft 25ft
Maximum (Detached)11: 18ft 18ft N/A
Maximum (Conversion): None8
Parking and Loading
Requirements: Maximum one offstreet parking
space per ADU or
per bedroom,
whichever is less12
Maximum one offstreet parking
space per ADU or
per bedroom,
whichever is less12
None
Miscellaneous Requirements
Sanitation Facilities:13 An ADU must have its own sanitation facility. A JADU may include separate sanitation facilities or may share sanitation facilities with the existing structure. A JADU without a separate bathroom must include a separate entrance from the main entrance to the proposed JADU, with an interior entry to the main living area.

Unit Access: A separate exterior entrance from the primary dwelling is required.
85 Kitchen: An ADU shall include a full kitchen that is separate from the primary dwelling. A JADU shall, at a minimum,
be permitted to include an efficiency kitchen which
shall contain a cooking facility with appliances and a food preparation counter with storage cabinets that are
reasonable in size in relation to the JADU.

Notes:
1 The standards set forth in this table shall not preclude the construction of an attached or detached ADU with at least 800 square feet of interior livable space and four-foot side and rear yard setbacks, consistent with Government Code section 66321, subdivision (b)(3).

Front setback, lot coverage, floor area ratio, open space, and similar development standards shall be applied in a manner consistent with State law.
2 The maximum unit number is a total aggregate maximum regardless of type of ADU. 3 Multiple accessory dwelling units within the portions of existing multifamily dwelling structures that are not used as livable space, including, but not limited to, storage rooms, boiler rooms, passageways, attics, basements, or garages, if each unit complies with state building standards for dwellings.
4 Calculated based on livable space. The minimum unit size shall not prohibit the development of an efficiency unit as defined in Section 17958.1 of the Health and Safety Code. 5 A junior accessory dwelling unit shall be contained entirely within a single-family dwelling and shall comply with Government Code section 66313, subdivision (d), and other applicable State law.
6 If there is an existing primary dwelling, the total floor area of an attached accessory dwelling unit shall not exceed 50 percent of the existing primary dwelling and at no time exceed 1,200 square feet.
7 A converted ADU may include an expansion of not more than 150 square feet beyond the same physical dimensions of an existing accessory structure when limited to accommodating ingress and egress, as authorized by Government Code section 66323, subdivision (a)(1)(A). A JADU shall remain limited to no more than 500 square feet of interior livable space and shall not be enlarged in a manner that alters the definition of a JADU under Government Code section 66313, subdivision (d).
8 No side or rear setback shall be required for an existing living area, existing accessory structure, or a structure constructed in the same location and to the same dimensions as an existing structure that is converted to an ADU or to a portion of an ADU, consistent with Government Code section 66314, subdivision (d)(7). Front setback requirements shall not preclude the construction of an ADU with at least 800 square feet of interior livable space and four-foot side and rear yard setbacks, consistent with Government Code section 66321, subdivision (b)(3). ADUs qualifying under Government Code section 66323 shall be subject only to setback requirements expressly authorized by State law.
9 Notwithstanding the 5-foot minimum separation shown in this table, no minimum separation beyond applicable California Building Code, Fire Code, or Wildland-Urban Interface Code requirements shall be imposed on an ADU qualifying under Government Code section 66323. In addition, local minimum distance requirements shall not be applied in a manner that precludes the construction of an ADU with at least 800 square feet of interior livable space and four-foot side and rear yard setbacks, consistent with Government Code section 66321, subdivision (b)(3). 86 10 Nothing in this note shall be interpreted to prohibit any ADU form required to be allowed under Government Code Section 66321, as amended.
11 An additional two feet in height may be allowed, provided that the roof of the ADU matches the roof pitch of the proposed or existing primary dwelling. 12 The spaces may be provided as tandem parking on a driveway and parking in setbacks are allowed as provided by Government Code Section 66314.
13 Where the property is less than 0.50 acres and not connected to the city sewer system, with an existing primary dwelling, an Advanced Treatment System designed to accommodate each additional dwelling is subject to approval by Environmental Health Services for the additional dwelling.

H. Development Standards Exemptions. An accessory dwelling unit and a junior accessory dwelling unit are exempt from the following standards:

1. Fire Sprinklers. Fire sprinklers shall not be required for an accessory dwelling unit or junior accessory dwelling unit if they are not required for the primary dwelling. The construction of an accessory dwelling unit shall not trigger a requirement for fire sprinklers to be installed in the existing primary dwelling.

2. Utility Connections. ADUs and JADUs shall be treated in accordance with Government Code Section 66311.5 and applicable fee law. An ADU or JADU shall not be considered a new residential use for utility connection or capacity charge purposes unless the unit is constructed with a new single-family dwelling. No impact fee shall be imposed on an ADU of 750 square feet or less of interior livable space, or on a JADU. Impact fees for ADUs larger than 750 square feet shall be proportional to the square footage of the primary dwelling. For ADUs/JADUs described in Government Code Section 66323(a)(1), the City and other applicable providers shall not require a new or separate utility connection or impose related connection or capacity charges, except as authorized by State law. For ADUs not described in Government Code Section 66323(a)(1), a separate connection may be required only as authorized by State law, and any charge shall be proportionate and not exceed the reasonable cost of service.

3. Parking. Parking for ADUs and JADUs shall be regulated as follows:
a. Parking for an ADU shall not exceed one off-street parking space per ADU or per bedroom, whichever is less, and may be provided as tandem parking or in setbacks as authorized by Government Code Section 66314, as amended. b. No parking shall be required for an ADU in any circumstance listed in Government Code Section 66322, as amended.
c. No replacement parking shall be required when a garage, carport, covered parking structure, or uncovered parking space is demolished in conjunction with the construction of an accessory dwelling unit or converted to an accessory dwelling unit.
87 d. No additional parking shall be required for a JADU.

4. Height Standards. (Gov. Code § 66321(b)(4))
a. Minimum heights permitted. The following minimum height allowances shall be permitted, as applicable:

1. Detached ADU (general): A height of at least sixteen (16) feet shall be permitted.

2. Detached ADU within one-half (1/2) mile walking distance of a major transit stop or a high-quality transit corridor: A height of at least eighteen (18) feet shall be permitted, plus up to an additional two (2) feet to accommodate a sloped roof pitch aligned with the primary dwelling.

3. Detached ADU on a lot with an existing or proposed multifamily, multistory dwelling: A height of at least eighteen (18) feet shall be permitted.

4. Attached ADU: A height of twenty-five (25) feet, or the height limit applicable to the primary dwelling in the underlying zone, whichever is lower; provided, however, that nothing in this section shall be interpreted to require allowance of an attached ADU exceeding two (2) stories. b. Height determination. For purposes of this section, building height shall be measured as the vertical distance from the average existing grade at the perimeter of the ADU building footprint to the highest point of the roof.

1. Average existing grade means the average of the highest and lowest points of existing grade measured at the exterior walls around the perimeter of the ADU footprint, prior to construction.

2. Sloped roofs: Height is measured to the highest point of the roof (ridge).

3. Flat roofs: Height is measured to the highest point of the roof surface, including any parapet.

4. Roof pitch aligned (objective standard): “Aligned with the primary dwelling” means the ADU roof slope matches the primary dwelling roof slope (same rise-over-run), and the additional two (2) feet allowance applies only where a sloped roof is provided.
c. Conflicts. If another provision of Title 17 establishes a lower height limit that would conflict with the minimum allowances in this subsection, this subsection shall control for ADUs/JADUs to the extent required by State law.
88 5. By-Right Permitting Exemptions. Notwithstanding any other provision of this Code, and consistent with Government Code Section 66323, the City shall ministerially approve an application for a building permit within a residential or mixed-use zone to create any of the following units, or any combination thereof:
a. One ADU and one JADU per lot with a proposed or existing single-family dwelling, where all requirements of Government Code Section 66323(a)(1) are met.
b. One detached, new-construction ADU on a lot with a proposed or existing single-family dwelling, with side and rear setbacks of no more than four feet, subject to the limitations authorized by Government Code Section 66323(a)(2).
c. Multiple ADUs within portions of existing multifamily dwelling structures that are not used as livable space, as provided in Government Code Section 66323(a)(3).
d. Detached ADUs on lots with an existing or proposed multifamily dwelling, in the amounts and subject to the standards provided in Government Code Section 66323(a)(4).
e. The City shall not impose objective standards not authorized by Government Code Section 66323 on units qualifying under this subsection.

I. Severability and Conflict with State Law. If any provision of this Section, or its application to any person or circumstance, is held invalid, the remainder of this Section shall not be affected and shall continue in full force and effect to the fullest extent permitted by law. This Section shall be interpreted and applied to provide the maximum allowances required by Chapter 13 of Division 1 of Title 7 of the Government Code (commencing with Section 66310), as amended. Any conflicting local provision shall be superseded and inoperative to the extent of the conflict.

SECTION 6. CODE AMENDMENT
Section 17.08.250 (“Single-family architecture”) of the Banning Municipal Code is hereby amended to add Subsections K.1 and K.2 as follows:

K. Applicability to ADUs/JADUs.

1. ADUs and JADUs shall be reviewed and approved ministerially and are not subject to discretionary architectural review or subjective compatibility determinations under this section.
89 2. Accessory dwelling units and junior accessory dwelling units subject to Section

17.08.100 and Government Code Section 66314 shall be subject only to objective standards authorized by State law and adopted in this Code. Any accessory dwelling unit or junior accessory dwelling unit qualifying for ministerial approval under Government Code Section 66323 shall not be subject to local design or development standards except as expressly authorized by Government Code Section 66323.

SECTION 7. CODE AMENDMENT
Section 17.12.190 (“Multi-family architecture”) of the Banning Municipal Code is hereby amended to add Subsections M.1 and M.2 as follows:

M. Applicability to ADUs/JADUs.

1. Accessory dwelling units (ADUs) shall be reviewed and approved ministerially and shall not be subject to discretionary architectural review or subjective compatibility findings.

2. Accessory dwelling units subject to Section 17.08.100 and Government Code Section 66314 shall be subject only to objective standards authorized by State law and adopted in this Code. Any accessory dwelling unit qualifying for ministerial approval under Government Code Section 66323 shall not be subject to local design or development standards except as expressly authorized by Government Code Section 66323.

SECTION 8. EFFECTIVE DATE AND PUBLICATION
The Mayor shall sign, and the City Clerk shall certify to the passage of this Ordinance and cause the same, or a summary thereof, to be published within fifteen (15) days after adoption in accordance with Government Code Section 36933. This Ordinance shall take effect thirty (30) days after adoption in accordance with Government Code Section 36937.

SECTION 9. SEVERABILITY
If any section, subsection, sentence, clause, phrase, or portion of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have adopted this Ordinance and each section, subsection, sentence, clause, phrase, or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional.

SECTION 10. PROSECUTION OF PRIOR ORDINANCE
Neither the adoption of this Ordinance nor the repeal or amendment of any prior ordinance of the City shall affect the prosecution of any violation of the Banning Municipal Code committed prior to the effective date of this Ordinance. 90 NOW, THEREFORE, BE IT ORDAINED that the City Council of the City of Banning, California, approves an amendment to the City of Banning Municipal Code.

Introduced and Read for the first time and ordered posted at a regular meeting of the City Council of the City of Banning, California, held on the 9 th day of June 2026.

PASSED, APPROVED AND ADOPTED on this 14th day of July 2026.

Richard Royce, Mayor
City of Banning
ATTEST:

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

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

I, Sandra Calderon, Deputy City Clerk of the City of Banning, California, do hereby certify that Ordinance No. 1624 was duly introduced at a regular meeting of the City Council of the City of Banning, held on the 9th day of June 2026, and was duly adopted at a regular meeting of said City Council on the 14th day of July, 2026, by the following vote, to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

Sandra Calderon, Deputy City Clerk
City of Banning, California
92 CITY OF BANNING

STAFF REPORT
TO: CITY COUNCIL
FROM: Elizabeth Gibbs, City Manager
PREPARED BY: Mario Carlos, Homeless Services Coordinator Elizabeth Gibbs
MEETING DATE: July 14, 2026
SUBJECT: Consideration of Resolution 2026-100, Approval of ERF-2-R Grant Agreement Amendment No.1 to Standard Agreement No. 23-ERF-2-R10022 with the California Department of Housing and Community Development for the Encampment Resolution Funding Program Round 2 Rolling grant
STAFF RECOMMENDATION:

Adopt Resolution 2026-100
BACKGROUND:

On December 12, 2023, the City Council adopted Resolution No. 2023-190 accepting $980,461 in Encampment Resolution Funding Program Round 2 Rolling grant funds and approving the original grant agreement.

The original Standard Agreement No. 23-ERF-2-R-10022 established a grant term from August 7, 2023, to March 31, 2027, with a maximum agreement amount of $980,461.

Grant funds have been utilized for various activities and purchases including 5 shelter sleeping pods, electrical hookups, sound wall barrier design, master leases and housing deposits, wraparound services/outreach, security cameras, street repairs, and eligible staff time. From December 1, 2022 through July 9, 2026, the City has served 187 clients through ERF-related efforts, with 41 clients discharged to permanent housing. The City has also placed 8 clients total into motel rooms through motel vouchers for interim sheltering, with 4 clients currently residing in motels.

The California Department of Housing and Community Development has provided Amendment No. 1 to the ERF-2-R Grant Agreement for City approval. The amendment extends the agreement term from March 31, 2027, to April 30, 2028. It also updates the agreement exhibits, transfers administrative references from Cal ICH to HCD, updates expenditure and disbursement timelines, adds an annual reporting requirement, and adds non-bond funded language.

The amendment does not increase the grant award amount, does not require an additional City match, and does not substantively change the eligible use categories. The City Attorney has reviewed the amendment and found it generally acceptable.

JUSTIFICATION:

Approval of Amendment No. 1 gives the City additional time to use the remaining ERF-2-R funds for eligible homeless services and complete required HCD reporting and closeout activities. 93 The remaining service funds are planned for two primary eligible uses:

Interim Sheltering / Motel Vouchers: Temporary motel placements for eligible individuals connected to the ERF-2-R encampment resolution efforts. These funds may cover short-term motel lodging while staff work with clients on housing plans, document readiness, service connections, and transition to more stable housing options.

Rapid Rehousing / Short-Term Rental Assistance: Housing-related assistance for eligible households, including short-term rental assistance, security deposits, first month’s rent, landlord incentives or holding fees where allowed, housing search assistance, case management, and service coordination needed to support housing stability.

The amendment also requires continued compliance with HCD grant requirements, including quarterly and annual reporting, final work product submission, HMIS/HDIS data requirements, record retention, and prior written HCD approval for budget changes between eligible use categories.

FISCAL IMPACT:

There is no additional fiscal impact associated with approval of Amendment No. 1. The ERF-2-R grant award remains $980,461, and this amendment requires no City match requirement or local appropriation.

The City received approval, through a budget change request, to apply ERF-2-R funds to eligible staff expenses that have already been incurred. Reimbursement of staff expenses will require an interfund transfer, as they were incurred in a prior fiscal year. Finance is completing the necessary accounting updates to reflect the approved reimbursement of those staff costs. Staff requests a budget appropriation of $338k to $480k, which is dependent on the final accounting for the grant. The interfund transfer budget will transfer funds from Successor Agency Low/Mod Fund 810 to the General Fund 001.

After those accounting updates are completed, the remaining programmable ERF-2-R service funds are anticipated to be approximately $114,001.41. This includes approximately $34,001.41 remaining for interim sheltering/motel vouchers and $80,000 remaining for rapid rehousing/short-term rental assistance.

Staff anticipates spending down the remaining service funds within the amended grant term, with priority given to motel voucher placements and rapid rehousing assistance for eligible households. Actual spend-down timing will depend on client eligibility, housing availability, landlord participation, and HCD requirements.

If Amendment No. 1 is not approved, the City may not benefit from the extended agreement term. It would be required to complete the remaining grant activities, reporting, and closeout under the existing agreement timeline, which may increase grant compliance risk.

ATTACHMENTS:

1. Resolution 2026-100.docx

2. ERF-2-R CC Resolution No. 2023-190.pdf

3. 23-ERF-2-R-10022-AM.1-Authorized-Signatory-Form.pdf

4. 23-ERF-2-R-10022-AM.1-STD213A-Pending.pdf

5. Motel_Voucher_Program_Outcome_Measures_01-09-2026_to_07-09-2026.pdf

6. Program_Outcome_Measures_12-01-2022_to_07-09-2026.pdf 94 Resolution 2026-100

RESOLUTION 2026-100

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BANNING, CALIFORNIA, APPROVING AMENDMENT NO. 1 TO STANDARD AGREEMENT NO. 23-ERF-2-R-10022 FOR THE ENCAMPMENT RESOLUTION FUNDING PROGRAM ROUND 2 ROLLING GRANT WHEREAS, on December 12, 2023, the City Council adopted Resolution No. 2023-190 accepting Encampment Resolution Funding Program Round 2 Rolling grant funds in the amount of $980,461 and approving the related Grant Agreement; and WHEREAS, the California Department of Housing and Community Development has provided Amendment No. 1 to Standard Agreement No. 23-ERF-2-R-10022, using the State’s STD 213A amendment form, which extends the agreement term to April 30, 2028, and updates related agreement exhibits and administrative provisions; and WHEREAS, Amendment No. 1 does not increase the grant award amount or require an additional City match.

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

SECTION 1. The City Council hereby approves Amendment No. 1 to Standard Agreement No. 23-ERF-2-R-10022 for the Encampment Resolution Funding Program Round 2 Rolling grant, substantially in the form attached hereto as Exhibit A.

SECTION 2. The City Council authorizes the City Manager, or designee, to execute Amendment No. 1, including the State’s STD 213A amendment form, and any related documents necessary to implement the amendment, subject to approval as to form by the City Attorney.

SECTION 3. The City Council authorizes the City Manager, or designee, to make any necessary non-substantive changes and any necessary budget adjustments mentioned in the staff report, appropriations, and transfers related to this resolution, provided such actions are consistent with the approved grant agreement, HCD requirements, and applicable City and State requirements.

SECTION 4. 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 14th day of July 2026.

Richard Royce, Mayor
City of Banning
ATTEST:
95 Resolution 2026-100

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

Phaedra A. Norton, City Attorney
Slovak, Baron, Empey, Murphy & Pinkney,
LLP
96 Resolution 2026-100

CERTIFICATION:

I, Sandra Calderon, Deputy City Clerk of the City of Banning, California, do hereby certify that the foregoing Resolution 2026-100, was duly adopted by the City Council of the City of Banning, California, at a regular meeting thereof held on the 14th day of July 2026 by the following vote, to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

Sandra Calderon, Deputy City Clerk
City of Banning, California
97 RESOLUTION 2023- 190

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

ACCEPTING GRANT FUNDS FROM THE STATE OF CALIFORNIA' S BUSINESS, CONSUMER SERVICES, AND HOUSING AGENCY IN THE AMOUNT OF $ 980,461 WHEREAS, The State of California has established the Encampment Resolution Funding Program ( ERF}, which is administered by the California lnteragency Council on Homelessness ( Cal ICH) in the Business, Consumer Services and Housing Agency; and WHEREAS, ERF provides one-time, competitive grant funds to Continuums of Care and/or Local Jurisdictions. The Program' s objective is to fund actionable, personcentered local proposals that resolve the experience of unsheltered homelessness for people residing in encampments; and
WHEREAS, the City of Banning was awarded a grant in the amount of 980,461.00 based on the needs of the community and the results of the existing shelter; and
WHEREAS, 100% of funds must be obligated and 50% of grant funds must be spent by June 30, 2024, and all projects must be completed and paid for by June 30, 2025. Failure to complete all projects by June 30, 2025, will result in forfeiture of those funds. Projects funded with this grant will be funded through account 810-9700-490.90-

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

SECTION 1. The City Council hereby accepts Program grant funds from the State of California' s Business, Consumer Services, and Housing Agency in the amount of 980,461.00 and approves the Grant Agreement attached hereto as Exhibit A.

SECTION 2. The City Council authorizes the City Manager or his designee to make all budget transfer and/or appropriations necessary and to sign the Grant Agreement on behalf of the City Council.

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

Resolution 2023-190

98 PASSED, APPROVED AND ADOPTED this 12th day of December 2023.

ATTEST:

APPROVED AS TO FORM AND
LEGAL CONTENT:

Serita R. Young, City Attorney
Richards, Watson & Gershon
Resolution 2023-190

99 CERTIFICATION:

I, Caroline Patton , Deputy City Clerk of the City of Banning, California , do hereby certify that the foregoing Resolution 2023-190 , was duly adopted by the City Council of the City of Banning, California , at a regular meeting thereof held on the 12th day of December 2023 by the following vote, to wit:

AYES: Flynn, Minjares, Sanchez, and Wallace .

NOES:

ABSENT:

ABSTAIN :

Resolution 2023- 190

Caroline Patton , Admi · trative City Clerk
City of Banning , Califo rn ia
100
Resolution 2023- 190

EXHIBIT A
Cal ICH Grant Agreement
101
BUSI NJ::SS, CONSUMER SE RV ICES AND HOUSING AGENCY
Califomia lnkn gt'ncy Council on Homelessness
500 Capitol Mall. Suite 1850 I
Sacr. unento, CA 95814
Phone: ( 916) 653- 4090 .

Fax: ( 916) 653- 38 15
ENCAMPMENT RESOLUTION FUND (ERF-2-R)

REQUEST FOR FUNDS FORM
Co ntract Number I23- ERF- 2- R- 10022 I
Invoice Number I23- ERF- 2- R- 10022 I
Expenditure Deadline: I6/ 30/ 2026 I
G rantee Name: City of Banning Co ntact Person: Doug Schulze Attention to: Contact Person Title : City Manager
Address: 99 E. Ramsey Street E- mail: dschulze@: banningca . gov C ity/State/ Zip: Banning , CA 92220 Pho ne No .: ( 951) 922- 3104

ENCAMPMENT RESOLUTION FUNDING BREAKDOWN
AWARD
Per Health and Safety Code Section 502 51 ( a), a recip ient may use encampment resolution funds for the purpose of ens urin g the safety and we lln ess of peop le ex periencin g hom elessness in enc ampments, reso lving criti cal encam pment concerns and tra ns ition indi viduals into safe and stab le housing, and encouragi ng a d ata - informed, coord in ated ap proach to add ress encampm ent concern s. Funds shall be s pent on reso lving the id en tifi ed, prioriti zed encampment through activit ies including, but not limited to, all of the following:

Rapid Rehousing
O peratin g Subs id ies
Street Outreach
Systems S upport
Delivery of Pennanent Housing
Prevention and Shelter Diversion
Interim Shelterin g
Improve ments to Existing Emergency Shelters
Administration ( up to 5%)
TOTAL: $980,461.00
I

CERTIFICATION I
I *
By s igning this. form. I cerl( fy to th(' b('Sf ofmy k11owh• dge and bt4hf that thl' fonn is tnu•, comp/('( e, and m ·c·1m11,•. and th(' acti, 1ith' s and budgc· r ar(' for th e purpost' S and objeC" rives ,\' el forth in th!• tums t1nd c-ondirio11 s qf the Sta11dt1rd I
Agreement. I am lll1' CJI"(' that any ft1l! w, jictitio us, or fraudulenl infurma1iu11, or tht' omission of any ma/ t•rilll foc i, may s11b}!' Cf m!' to criminal. ci1· i/ nr administrati1• e p<• 1,alrh• s fo r fraud .. fit! se slatements, ftdsc' claims or otherwise.

IDoug Schulze ! Ci ty Manager I
Nam• ., ., -• L
ized Represent: atiYe or Sie: naton' Title of Auth ori zed Reoresentative or Si2 natorv IV ~•--/?~_,_:/_ /' I
7/11/2023 I
filpNl' fiire of Alldaorized Rf"" presentafive or Siz: natory Date

BCSH USE ONLY
IJeannie McKendry IGrant s Development Section Chi ef I Gra nt Maoa!! ement Reoresentative Name Gra nt Manae: ement Reoresentative Title I CL.,.,-:,~ -~:.. 711, c/( q_..,,_,,./,.~ I
7/28/23 I
Sien.. alre of G rant Manaeement Reoresentative / 1 Date V
V
102
STATE OF CALIFORNIA- DEPARTMENT OF GENERAL SERVICES ~-----------~-------------~

STANDARD AGREEMENT
STD 213 ( Rev. 04/2020)

AGREEMENT NUMBER
23-ERF-2-R-10022
PURCHASING AUTHORITY NUMBER ( If Applicable)
010725

1. This Agreement is entered into between the Contracting Agency and the Contractor named below:

CONTRACTING AGENCY NAME
Business, Consumer Services and Housing Agency

CONTRACTOR NAME
City of Banning

2. The term of this Agreement is :

START DATE
8/7/2023

THROUGH END DATE
3/31/ 2027

3. The maximum amount ofthis Agreement is:
980, 461. 00 ( Nine Hundred Eighty Thousand Four Hundred Sixty One Dollars and No Cents)

4. The parties agree to comply with the terms and conditions ofthe following exhibits, which are by this reference made a part ofthe Agreement.

Exhibits Title
Exhibit A Authority, Purpose and Scope of Work
Exhibit B Budget Detail and Disbursement Provisions
Exhibit C State of California General Terms and Conditions Exhibit D General Terms and Conditions -
Exhibit E Special Terms and Conditions -
Items shown with an asterisk(*), are hereb y incol porated by reference and made part of this agreement as if attached hereto.

These documents can be viewed at https:// www. dqs .ca.gov/ OLS/ Resources IN WITNESS WHEREOF, THIS AGREEMENT HAS BEEN EXECUTED BY THE PARTIES HERETO.

CONTRACTOR
CONTRACTOR NAME ( if other than an individual, state whether a corporation, partnership, etc.) City of Banning

CONTRACTOR BUSINESS ADDRESS
99 E. Ramsey Street

PRINTED NAME OF PERSON SIGNING
Doug Schulze
CITY
Banning
TITLE
City Manager

DATE SIGNED
7/11/ 2023
STATE
CA
Pages
6 4
1 10
2 ZIP
92220
Paae 1 of 2
103
STATE OF CALIFORNIA- DEPARTMENT OF GENERAL SERVICES ~-----------~---------------,

STANDARD AGREEMENT
STD 213 ( Rev. 04/2020)

CONTRACTING AGENCY NAME
Business, Consumer Services and Housing Agency

CONTRACTING AGENCY ADDRESS
500 Capitol Mall, Suite 1850

PRINTED NAME OF PERSON SIGNING
Lourdes Castro Ramirez

CONTRACTING AGENCY AUTHORIZED SIGNATURE
1~~~

CALIFORNIA DEPARTMENT OF GENERAL SERVICES APPROVAL

AGREEMENT NUMBER
23-ERF-2-R-10022

STATE OF CALIFORNIA
PURCHASING AUTHORITY NUMBER ( If Applicable)
010725
CITY
Sacramento
illLE
Secretary

DATE SIGNED
Aug 7, 2023
EXEMPTION ( If Applicable)
STATE \ ZIP
CA 95814
Paae 2 of 2
104
1 ) Authority
Encampment Resolution Funding Program
Round 2, Rolling Disbursement ( ERF-2-R)
Standard Agreement

EXHIBIT A
City of Banning
23-ERF-2-R-10022

AUTHORITY, PURPOSE, AND SCOPE OF WORK
The State of California has established the Encampment Resolution Funding Program (" ERF" or "Program") pursuant to Chapter 7 (commencing with Section 50250) of Part 1 of Division 31 of the Health and Safety Code. Amended by SB 197 Statutes of 2022, Chapter 70, Sec.3-8, effective June 30, 2022).

The Program is administered by the California lnteragency Council on Homelessness (" Cal ICH") in the Business, Consumer Services and Housing Agency (" Agency"). ERF provides one-time, competitive grant funds to Continuums of Care and/ or Local Jurisdictions as defined below. To date, there have been two rounds of the Encampment Resolution Funding Program. This Standard Agreement governs the Rolling Disbursement in Round 2 of the ERF Program (" ERF-2-R"). For this Standard Agreement, ERF-2-R is synonymous with "ERF" or "Program"." and refers to programs and grantees under Health and Safety Code 50252.1 (c)(1 ).

This Standard Agreement along with all its exhibits (" Agreement") is entered into by Cal ICH and a Continuum of Care or a Local Jurisdiction (" Grantee") under the authority of, and in furtherance of, the purpose of the Program. In signing this Agreement and thereby accepting this award of funds, the Grantee agrees to comply with the terms and conditions of this Agreement, the Notice of Funding Availability NOFA") under which the Grantee applied, the representations contained in the Grantee' s application, Cal ICH guidance or directives, and the requirements appearing in the statutory authority for the Program cited above. 2) Purpose
As stated in the NOFA, the Program' s objective is to fund actionable, personcentered local proposals that resolve the experience of unsheltered homelessness for people residing in encampments. Resolving these experiences of homelessness will necessarily address the safety and wellness of people within encampments, resolve critical encampment concerns, and transition individuals into interim shelter with clear pathways to permanent housing or directly into permanent housing, using data informed, non-punitive, low-barrier, person- centered, Housing First, and coordinated approaches. These projects must comply with the principles of Housing First as defined in Welfare and Institutions Code Section 8255. Proposals may bolster existing, successful models and/or support new approaches that provide safe stable, and ultimately permanent housing for people experiencing homelessness in Initial Here_d_s __
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encampments. Expenditures shall be consistent with the legislative intent of the authorizing statute to ensure the safety and wellness of people experiencing homelessness in encampments.
3) Definitions
The following Encampment Resolution Funding Program terms are defined in accordance with Health and Safety Code Section 50250, Subdivisions ( a) -( I); a) "Additional funding round moneys" means moneys appropriated for the program in or after fiscal year 2022- 23.
b) "Agency" means the Business, Consumer Services, and Housing Agency. c) "Applicant" means a continuum of care or local jurisdiction d) "Continuum of Care" has the same meaning as in Section 578.3 of Title 24 of the Code of Federal Regulations.
e) "Council" means the California lnteragency Council on Homelessness, previously known as the Homeless Coordinating and Financing Council created pursuant to Section 8257 of the Welfare and Institutions Code.
f) "County" includes, but is not limited to, a city and county. g) "Funding round 1 moneys" means moneys appropriated for the program in fiscal year 2021- 22.
h) "Homeless" has the same meaning as in Section 578.3 of Title 24 of the Code of Federal Regulations.
i) "Local Jurisdiction" means a city, including a charter city, a county, including a charter county, or a city and county, including a charter city and county.

U) " Program" means the Encampment Resolution Funding program established pursuant to this chapter.
k) "Recipient" means an applicant that receives grant funds from the council for the purposes of the program.

I) "State right- of-way" means real property held in title by the State of California Additional definitions for the purposes of ERF program:

Grantee" is "a Continuum of Care or a Local Jurisdiction that receives grant funds from the Council for the purposes of the program. Grantee is synonymous with Recipient."
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Subrecipients" or "Subgrantees" are entities that receive subawards from Recipients" or "Grantees" to carry out part of the Program.

Expended" means all ERF funds obligated under contract or subcontract that have been fully paid and receipted, and no invoices remain outstanding.

Obligate" means that the Grantee has placed orders, awarded contracts, received services, or entered into similar transactions that require payment using ERF funding. Grantees must obligate the funds by the statutory deadlines set forth in this Exhibit A.

Cal ICH" is synonymous with " Council".
4) Scope of Work
This Scope of Work identifies the terms and conditions necessary to accomplish the Program' s intended objectives.

As detailed in Exhibit A.2 , the Program' s objective is to fund grantees to implement actionable, person- centered local proposals that resolve the experience of unsheltered homelessness for people residing in encampments.

Grantees will implement their ERF funded local proposals in compliance with the terms and conditions of this Agreement, the NOFA under which the Grantee applied , the representations contained in the Grantee 's application, Cal ICH guidance and directives, and the requirements per the authorizing statute.

Expenditures shall be consistent with the legislative intent of the authorizing statute to ensure the safety and wellness of people experiencing homelessness in encampments. Permissible eligible uses and activities are detailed below in Exhibit B, Budget Details and Disbursement Provisions. Prior to fully executing this agreement, Grantees must standardize their budget using a Cal ICH provided budget template.

Grantees are expected to be close partners with Cal ICH. This means timely and accurate reporting, candid communication of successes and challenges , and availability of persons, information, or materials.

Quarterly reporting requirements are detailed below in Exhibit 0.4. Reporting, Evaluation, and Audits.

Fiscal deadlines are detailed below in Exhibit A.6. Effective Date, Term of Agreement, and Deadlines.

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Grantees shall complete a Final Work Product ( As detailed below in Exhibit A.6.d.) and participate in a program evaluation regarding their implementation of ERF awards. To support this effort, Cal ICH will make Technical Assistance available.

Cal ICH maintains sole authority to determine if a Grantee is acting in compliance with the program objectives and may direct Grantees to take specified actions or risk breach of this Agreement. Grantees will be provided reasonable notice and Cal ICH's discretion in making these determinations are absolute and final. 5) Cal ICH Contract Coordinator
Cal ICH's Contract Coordinator for this Agreement is the Council' s Grant Development Section Chief or the Grant Development Section Chief's designee.

Unless otherwise instructed, any communication shall be conducted through email to the Cal ICH Contractor Coordinator or their designee. If documents require an original signature, the strongly preferred form is an e-Signature in accordance with the Uniform Electronic Transactions Act (UETA). If an Awardee is unwilling or unable to sign a document electronically, Agency shall accept wet or original signed documents. These documents containing wet signatures should be both mailed to Cal ICH and scanned and emailed as instructed. State law or policy may require the use of wet signatures for specific documents. The Representatives during the term of this Agreement will be:

PROGRAM GRANTEE
ENTITY:

Business, Consumer Services
City of Banning
and Housing Agency
California lnteragency Council on
SECTION/ LIN IT: Homelessness
Cal ICH)
ADDRESS:
801 Capital Mall, 6th floor 99 E. Ramsey Street,
Sacramento, CA, 95814 Banning, CA 92220

CONTRACT
Jeannie McKendry Doug Schulze

COORDINATOR

PHONE (
916) 510-9446 ( 951) 922-3104
NUMBER:

EMAIL Jeannie. McKendry@bcsh. ca.gov
dschulze@banningca. gov
ADDRESS: and calichgrants@bcsh. ca.gov
The Council reserves the right to change their Cal ICH Contractor Coordinator, designee, and/ or contact information at any time with reasonable notice to the Grantee.

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All requests to update the Grantee information listed within this Agreement shall be emailed to Cal ICH grant's general email box at calichgrants@bcsh. ca.gov.

Notice to either party may be given by email. Such notice shall be effective when received as indicated on email. Changes to Cal ICH Contractor Coordinator, designee, and / or contact information or grantee information can be made without a formal amendment, approved by DGS.
6) Effective Date, Term of Agreement, and Deadlines
a) This Agreement is effective upon execution by Cal ICH, which includes signature from the Grantee and Cal ICH. This is indicated by the Cal ICH provided signature and date on the second page of the accompanying STD. 213, Standard Agreement.
b) Performance shall start no later than 30 days, or on the express date set by Cal ICH and the Grantees, after all approvals have been obtained and the Grant Agreement is fully executed. Should the Grantee fail to commence work at the agreed upon time, Cal ICH, upon five (5) days written notice to the grantee, reserves the right to terminate the Agreement.
c) Grantees will continue to perform until the Agreement is terminated, including data reporting and participation in program evaluation activities, as needed. d) This Agreement will terminate on March 31, 2027.

Grantees shall submit a Final Work Product by September 30, 2026. The Final Work Product will include programmatic and fiscal data and a narrative on the outputs and outcomes of the program on a reporting template to be provided by Cal ICH.

Cal ICH will review submitted Final Work Products and collaborate with Grantees to cure any deficiencies by March 31, 2027.

Grantees are expected to continue performing until March 31, 2027. This means timely and accurate reporting, candid communication of success or shortcomings, and availability of persons, information, or materials. e) Expenditure and Obligation Deadlines:
i. Grantees shall expend no less than 50 percent and obligate 100 percent of Program funds by June 30, 2024.

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ii. Grantees that have not obligated 100 percent of their Program funds by June 30, 2024, shall submit an alternative disbursement plan to Cal ICH for approval no later than July 30, 2024. This alternative disbursement plan should detail the explanation for the delay and plans for all future obligations and expenditures.
iii. Grantees not meeting the requirements outlined in ( i) may be subject to additional corrective action, as determined by Cal ICH. iv. All Program funds ( 100 percent) shall be expended by June 30, 2026. Any funds not expended by this date shall revert to the fund of origin pursuant to HSC Section 50253( e)(5).
7) Special Conditions
Cal ICH maintains sole authority to determine if a Grantee is acting in compliance with the program objectives and may direct Grantees to take specified actions or risk breach of this Agreement. Grantees will be provided reasonable notice and Cal ICH's discretion in making these determinations are absolute and final.

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EXHIBIT B
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BUDGET DETAIL and DISBURSEMENT PROVISIONS
1) General Conditions Prior to Disbursement
All Grantees must submit the following completed forms prior to ERF being released:

Request for Funds Form (" RFF")
STD 213 Standard Agreement form and initialed Exhibits A through E STD 204 Payee Data Record or Government Agency Taxpayer ID Form 2) Disbursement of Funds
ERF will be disbursed to the Grantee upon receipt, review and approval of the completed Standard Agreement and RFF by Cal ICH, the Department of General Services ( DGS), and the State Controller' s Office ( SCO).

The RFF must include the total amount of Program funds proposed to be expended.

The ERF will be disbursed in one allocation via mailed check once the RFF has been received by the SCO. Checks will be mailed to the address and contact name listed on the RFF.
3) Budget Details and Expenditure of Funds
The Grantee shall expend Program funds on eligible uses and activities as detailed in the submitted standardized budget. Cal ICH reserves the right to direct specific line-item changes in the originally submitted Application budget or subsequently submitted standardized budgets.
a) Budget Changes
i) Process:

Budget modification requests should be made as part of the quarterly report process. These requests will be reviewed in the first week after quarterly reports are received. Cal ICH may consider budget change requests outside of this process, through email as needed due to documented, exigent circumstances. Grantees carry the burden to anticipate foreseeable budget change requests and should plan accordingly.

Cal ICH reserves the right to amend or adjust this process as necessary.

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ii) Conditions requiring a budget modification request:

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Changes may be made to the timing ( e.g., fiscal year) of eligible use expenditures without prior approval by Cal ICH so long as the total expenditures ( actual and projected) for each eligible use category remain the same as approved in the standardized budget.

Any decrease or increase to the total expenditures for any eligible use category must be approved by Cal ICH's Grant Development Section Chief or their designee, in writing, before the Grantee may expend Program funds according to an alternative standardized budget. The Grant Development Section Chief will respond to Grantee with approval or denial of request. Failure to obtain written approval from Cal ICH as required by this section may be considered a breach of this Agreement. A breach of this agreement may result in remedies listed below in Exhibit D.6. Breach and Remedies.

Regardless of an increase or decrease of an expenditure amount, any significant or material programmatic or fiscal change as considered by a reasonable project manager should be submitted to Cal ICH for approval. b) Eligible Uses
Eligible uses and activities must be consistent with HSC Sections 50250 - 50254, other applicable laws, the terms and conditions of this Agreement, Cal ICH guidance or directives, the NOFA under which the Grantee applied, representations contained in the Grantee' s application, and the Purpose of the Program as detailed in Exhibit A.2. Purpose.

Eligible uses and activities include, but are not limited to, the following:

Rapid Rehousing: Rapid rehousing, including housing identification services, rental subsidies, security deposits, incentives to landlords, and holding fees for eligible persons, housing search assistance, case management and facilitate access to other community- based services.

Operating Subsidies: Operating subsidies in new and existing affordable or supportive housing units, emergency shelters, and navigation centers. Operating subsidies may include operating reserves.

Street Outreach: Street outreach to assist eligible persons to access crisis services, interim housing options, and permanent housing and services. Services Coordination Services coordination, which may include access to workforce, education, and training programs, or other services needed to improve and Initial Here_d_s __
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promote housing stability for eligible persons, as well as direct case management services being provided to persons.

Systems Support: Systems support for activities that improve, strengthen, augment, complement, and/or are necessary to create regional partnerships and a homeless services and housing delivery system that resolves persons' experiences of unsheltered homelessness.

Delivery of Permanent Housing: Delivery of permanent housing and innovative housing solutions, such as unit conversions that are well suited for eligible persons.

Prevention and Shelter Diversion: Prevention and shelter diversion to permanent housing, including flexible forms of financial assistance, problem solving assistance, and other services to prevent people that have been placed into permanent housing from losing their housing and falling back into unsheltered homelessness. This category is only available to serve people who were formerly residing in the prioritized ERF encampment site.

Interim Sheltering: Interim sheltering, limited to newly developed clinically enhanced congregate shelters, new or existing non-congregate shelters, and operations of existing navigation centers and shelters based on demonstrated need that are well suited for eligible persons.

Improvements to Existing Emergency Shelters: Improvements to existing emergency shelters to lower barriers, increase privacy, better address the needs of eligible persons, and improve outcomes and exits to permanent housing.

Administration: up to 5% of awarded Program funds may be applied to administrative costs.

Program funds shall not be expended on Site Restoration or other Ineligible Costs as detailed immediately below.
4) Ineligible Costs
ERF shall not be used for costs associated with activities in violation, conflict, or inconsistent with HSC Sections 50250 - 50254, other applicable laws, the terms and conditions of this Agreement, Cal ICH guidance or directives, the NOFA under which the Grantee applied, representations contained in the Grantee' s application, and the Purpose of the Program as detailed in Exhibit A.2. Purpose.

Costs shall not be used for any use or activity that is in violation, conflict, or inconsistent with the legislative intent of the authorizing statute to ensure the safety and wellness of people experiencing homelessness in encampments.

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Moreover, no parties to this contract nor their agents shall directly or indirectly use ERF awards for any use or activity that is in violation, conflict, or inconsistent with the legislative intent of the authorizing statute to ensure the safety and wellness of people experiencing homelessness in encampments. ERF funded activities that cause a traumatic effect are inconsistent with ensuring the safety and wellness of people experiencing homelessness in encampments.

Cal ICH, at its sole and absolute discretion, shall make the final determination regarding the allowability of ERF expenditures.

Cal ICH reserves the right to request additional clarifying information to determine the reasonableness and eligibility of all uses of the funds made available by this Agreement. If the Grantee or its funded subrecipients use ERF funds to pay for ineligible activities, the Grantee shall be required to reimburse these funds to Cal ICH at an amount and timeframe determined by Cal ICH.

An expenditure which is not authorized by this Agreement, or by written approval of Cal ICH, or which cannot be adequately documented, shall be disallowed, and must be reimbursed to Cal ICH by the Grantee at an amount and timeframe determined by Cal ICH.

Program funds shall not be used to supplant existing local funds for homeless housing, assistance, prevention, or encampment resolution including site restoration or waste management.

Unless expressly approved by Cal ICH in writing reimbursements are not permitted for any Program expenditures prior to this Agreement' s date of execution.

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EXHIBIT C
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STATE OF CALIFORNIA GENERAL TERMS AND CONDITIONS
This exhibit is incorporated by reference and made part of this agreement. The General Terms and Conditions { GTC 04/2017) can be viewed at the following link:
https:// www.dgs.ca.gov/-/ media/ Divisions/ OLS/Resources/ GTC-April-2017- FINALapril2017 .pdf?la=en&hash=3A64979F777D589D35309433EE81969FD69052D2 In the interpretation of this Agreement, any inconsistencies between the State of California General Terms and Conditions ( GTC - 04/2017) and the terms of this Agreement and its exhibits/ attachments shall be resolved in favor of this Agreement and its exhibits/ attachments.

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EXHIBIT D

GENERAL TERMS AND CONDITIONS
1) Termination and Sufficiency of Funds
a) Termination of Agreement
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Cal ICH may terminate this Agreement at any time for cause by giving a minimum of 14 days' notice of termination, in writing, to the Grantee. Cause shall consist of violations of any conditions of this Agreement, any breach of contract as described in paragraph 6 of this Exhibit D; violation of any federal or state laws; or withdrawal of Cal ICH's expenditure authority. Upon termination of this Agreement, unless otherwise approved in writing by Cal ICH, any unexpended funds received by the Grantee shall be returned to Cal ICH within 30 days of Cal ICH's specified date of termination. b) Sufficiency of Funds
This Agreement is valid and enforceable only if sufficient funds are made available to Cal ICH by legislative appropriation. In addition, this Agreement is subject to any additional restrictions, limitations or conditions, or statutes, regulations or any other laws, whether federal or those of the State of California, or of any agency, department, or any political subdivision of the federal or State of California governments, which may affect the provisions, terms or funding of this Agreement in any manner.
2) Transfers
Grantee may not transfer or assign by subcontract or novation, or by any other means, the rights, duties, or performance of this Agreement or any part thereof, except as allowed within Exhibit D.12. ( Special Conditions - Grantees/ Sub Grantee) or with the prior written approval of Cal ICH and a formal amendment to this Agreement to affect such subcontract or novation.
3) Grantee' s Application for Funds
Grantee submitted a standardized budget to Cal ICH as part of their application for the Program.

Grantee warrants that all information, facts, assertions and representations contained in the application and approved modifications and additions thereto are true, correct, and complete to the best of Grantee' s knowledge. In the event that any Initial Here_d_s __ _
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part of the application and any approved modification and addition thereto is untrue, incorrect, incomplete, or misleading in such a manner that would substantially affect Cal ICH approval, disbursement, or monitoring of the funding and the grants or activities governed by this Agreement, then Cal ICH may declare a breach of this Agreement and take such action or pursue such remedies as are legally available. 4) Reporting, Evaluation, and Audits
a) Reporting Requirements
i. Timing and Format of Reports.

Grantee is required to provide Cal ICH or its agents with all data and outcomes that may inform an assessment of the funded proposal. Grantees shall report quarterly and have one Final Work Product submitted prior to this Agreement' s termination.

The quarterly reports shall be submitted on a template to be provided by Cal ICH at least 90 days prior to the first reporting deadline. Cal ICH may request interim reports as needed and will provide no less than 30 days' notice to Grantees.
ii. Required Data
Grantees will be required to provide:

Outreach and service path data at the anonymized, individual level; Current housing status of persons served in the aggregate; Status of funding as presented in the Cal ICH approved, standardized budget; and
Continued confirmation that projects receiving ERF funds are populated timely into HMIS and use Cal ICH supplied funding codes.

Cal ICH's discretion in identifying which information shall be included in these reports is final.

Pursuant to HSC Section 50254, grantees shall provide data elements, including, but not limited to, health information, in a manner consistent with state and federal law, to their local Homeless Management Information System for tracking in the statewide Homeless Data Integration System.

Pursuant to HSC Section 50254(b )(3), Grantees shall report individual, client-level data for persons served by grant funding to the council, in addition to any data reported through local Homeless Management Information System, as required by the council for the purposes of research Initial Here_d_s __
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and evaluation of grant performance, service pathways, and outcomes for people served.

Grantees shall comply with the data entry requirements of AB977, located at Welfare and Institutions Code section 8256(d).
iii. Cal ICH usage of Reports
Pursuant to HSC Section 50254(b )(4 ), Council staff may use information reported directly from grantees and through statewide Homeless Data Integration System for the purposes of research and evaluation of grant performance, service pathways, and outcomes for people served. iv. Failure to Report
If the Grantee fails to provide any such report, Cal ICH may recapture any portion of the amount authorized by this Agreement with a 14-day written notification.
b) Evaluation
i. At Cal ICH's discretion, Grantees shall participate in a program evaluation regarding their implementation of ERF awards. To support this effort, Cal ICH will contract a third party to complete the evaluation. ii. Grantees are expected to be close partners with Cal ICH for this program evaluation and for all evaluative aspects of this Program. This means timely and accurate reporting, candid communication of success or challenges, and availability of persons, information, or materials. More specifically, Grantees must cooperate with Cal ICH or its designee as reasonably required to implement an evaluation plan. This includes providing or facilitating the collection of data and materials as reasonably requested by Cal ICH or its designee.
iii. For the purpose of evaluation, Cal ICH or its designee may visit sites related to the project and film, tape, photograph, interview, and otherwise document Grantee' s operations during normal business hours and with reasonable advance notice. Cal ICH will comply with Grantee' s site visit terms during any site visits.
iv. Grantees should maintain active data, documents, and filings in anticipation of this evaluation. Special care should be taken to organize and preserve internal work products that guided implementation by the Grantee or subgrantee.

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v. Grantees shall notify Cal ICH and provide copies of any reports or findings if Grantee conducts or commissions any third-party research or evaluation regarding their funded project.
vi. All terms and conditions that apply to reporting similarly apply to evaluation. c) Auditing
Cal ICH reserves the right to perform or cause to be performed a financial audit.

At Cal ICH request, the Grantee shall provide, at its own expense, a financial audit prepared by a certified public accountant. Should an audit be required, the Grantee shall adhere to the following conditions:
i) The audit shall be performed by an independent certified public accountant. ii) The Grantee shall notify Cal ICH of the auditor' s name and address immediately after the selection has been made. The contract for the audit shall allow access by Cal ICH to the independent auditor' s working papers. iii) The Grantee is responsible for the completion of audits and all costs of preparing audits.
iv) If there are audit findings, the Grantee must submit a detailed response acceptable to Cal ICH for each audit finding within 90 days from the date of the audit finding report.
5) Inspection and Retention of Records
a) Record Inspection
Cal ICH or its designee shall have the right to review, obtain, and copy all records and supporting documentation pertaining to performance under this Agreement. The Grantee agrees to provide Cal ICH, or its designee, with any relevant information requested. The Grantee agrees to give Cal ICH or its designee access to its premises, upon reasonable notice and during normal business hours, for the purpose of interviewing employees who might reasonably have information related to such records, and of inspecting and copying such books, records, accounts, and other materials that may be relevant to an investigation of compliance with the ERF laws, Cal ICH guidance or directives, and this Agreement.
b) Record Retention
The Grantee further agrees to retain all records described in subparagraph A for a minimum period of five (5) years after the termination of this Agreement.

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If any litigation, claim, negotiation, audit, monitoring, inspection, or other action has been commenced before the expiration of the required record retention period, all records must be retained until completion of the action and resolution of all issues which arise from it.
c) Public Records Act
The grantees' final HHAP- 4 application, this contract, and other documents related to the grant are considered public records, which are available for public viewing pursuant to the California Public Records Act.
6) Breach and Remedies
a) Breach of Agreement
Breach of this Agreement includes, but is not limited to, the following events:
i. Grantee' s failure to comply with the terms or conditions of this Agreement. ii. Use of, or permitting the use of, Program funds provided under this Agreement for any ineligible activities.
iii. Any failure to comply with the deadlines set forth in this Agreement. b) Remedies for Breach of Agreement
In addition to any other remedies that may be available to Cal ICH in law or equity for breach of this Agreement, Cal ICH may:
i. Conduct a program monitoring which will include a corrective action plan CAP) with findings, remedies, and timelines for resolving the findings. ii. Bar the Grantee from applying for future ERF funds; iii. Revoke any other existing ERF award( s) to the Grantee; iv. Require the return of any unexpended ERF funds disbursed under this Agreement;
v. Require repayment of ERF funds disbursed and expended under this Agreement;
vi. Require the immediate return to Cal ICH of all funds derived from the use of ERF
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vii. Seek, in a court of competent jurisdiction, an order for specific performance of the defaulted obligation or participation in the technical assistance in accordance with ERF requirements.
c) All remedies available to Cal ICH are cumulative and not exclusive. d) Cal ICH may give written notice to the Grantee to cure the breach or violation within a period of not less than 14 days.
i
7) Waivers
No waiver of any breach of this Agreement shall be held to be a waiver of any prior or subsequent breach. The failure of Cal ICH to enforce at any time the provisions of this Agreement, or to require at any time, performance by the Grantee of these provisions, shall in no way be construed to be a waiver of such provisions nor to affect the validity of this Agreement or the right of Cal ICH to enforce these provisions.
8) Nondiscrimination
During the performance of this Agreement, Grantee and its subrecipients shall not unlawfully discriminate, harass, or allow harassment against any employee or applicant for employment because of sex (gender), sexual orientation, gender identity, gender expression, race, color, ancestry, religion, creed, national origin including language use restriction), pregnancy, physical disability ( including HIV and AIDS), mental disability, medical condition ( cancer/ genetic characteristics), age over 40), genetic information, marital status, military and veteran status, denial of medical and family care leave or pregnancy disability leave, or any other characteristic protected by state or federal law. Grantees and Sub grantees shall ensure that the evaluation and treatment of their employees and applicants for employment are free from such discrimination and harassment. Grantee and its subrecipients shall comply with the provisions of California' s laws against discriminatory practices relating to specific groups: the California Fair Employment and Housing Act (FEHA) ( Gov. Code, Section 12900 et seq.); the regulations promulgated thereunder ( Cal. Code Regs., tit. 2, Section 11000 et seq.); and the provisions of Article 9.5, Chapter 1, Part 1, Division 3, Title 2 of the Government Code ( Gov. Code, Section 11135 - 11139.5). Grantee and its subrecipients shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement. 9) Conflict of Interest
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result in the application being rejected and any subsequent contract being declared void. Other legal action may also be taken. Additional applicable statutes include, but are not limited to, Government Code Section 1090 and Public Contract Code Sections 10410 and 10411.
a) Current State Employees: No State officer or employee shall engage in any employment, activity, or enterprise from which the officer or employee receives compensation or has a financial interest, and which is sponsored or funded by any State agency, unless the employment, activity, or enterprise is required as a condition of regular State employment. No State officer or employee shall contract on his or her own behalf as an independent Grantee with any State agency to provide goods or services.
b) Former State Employees: For the two- year period from the date he or she left State employment, no former State officer or employee may enter into a contract in which he or she engaged in any of the negotiations, transactions, planning, arrangements, or any part of the decision- making process relevant to the contract while employed in any capacity by any State agency. For the twelvemonth period from the date he or she left State employment, no former State officer or employee may enter into a contract with any State agency if he or she was employed by that State agency in a policy- making position in the same general subject area as the proposed contract within the twelve- month period prior to his or her leaving State service.
c) Employees of the Grantee: Employees of the Grantee shall comply with all applicable provisions of law pertaining to conflicts of interest, including but not limited to any applicable conflict of interest provisions of the Political Reform Act of 1974 ( Gov. Code, Section 81000 et seq.).
d) Representatives of a County: A representative of a county serving on a board, committee, or body with the primary purpose of administering funds or making funding recommendations for applications pursuant to this chapter shall have no financial interest in any contract, program, or project voted on by the board, committee, or body on the basis of the receipt of compensation for holding public office or public employment as a representative of the county. 10) Drug- Free Workplace Certification
Certification of Compliance: By signing this Agreement, Grantee hereby certifies, under penalty of perjury under the laws of State of California, that it and its subrecipients will comply with the requirements of the Drug- Free Workplace Act of 1990 ( Gov. Code, Section 8350 et seq.) and have or will provide a drug- free workplace by taking the following actions:

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Publish a statement notifying employees and subrecipients that unlawful manufacture distribution, dispensation, possession, or use of a controlled substance is prohibited and specifying actions to be taken against employees, Grantees, or subrecipients for violations, as required by Government Code Section 8355, subdivision ( a)(1 ).
a) Establish a Drug- Free Awareness Program, as required by Government Code Section 8355, subdivision ( a)(2) to inform employees, Grantees, or subrecipients about all of the following:
i. The dangers of drug abuse in the workplace;
ii. Grantee' s policy of maintaining a drug- free workplace; iii. Any available counseling, rehabilitation, and employee assistance program; and
iv. Penalties that may be imposed upon employees, Grantees, and subrecipients for drug abuse violations.
b) Provide, as required by Government Code Section 8355, subdivision ( a)(3), that every employee and/ or subrecipient that works under this Agreement:
i. Will receive a copy of Grantee' s drug- free policy statement, and ii. Will agree to abide by terms of Grantee' s condition of employment or subcontract.
11) Child Support Compliance Act
For any Contract Agreement in excess of $100,000, the Grantee acknowledges in accordance with Public Contract Code 7110, that:
a) The Grantee recognizes the importance of child and family support obligations and shall fully comply with all applicable state and federal laws relating to child and family support enforcement, including, but not limited to, disclosure of information and compliance with earnings assignment orders, as provided in Chapter 8 (commencing with Section 5200) of Part 5 of Division 9 of the Family Code; and
b) The Grantee, to the best of its knowledge is fully complying with the earnings assignment orders of all employees and is providing the names of all new employees to the New Hire Registry maintained by the California Employment Development Department.

Initial Here_d_s __
123
City of Banning
23-ERF-2-R-10022

12) Special Conditions - Grantees/ Subgrantee
The Grantee agrees to comply with all conditions of this Agreement including the Special Conditions set forth in Exhibit E. These conditions shall be met to the satisfaction of Cal ICH prior to disbursement of funds. The Grantee shall ensure that all Subgrantees are made aware of and agree to comply with all the conditions of this Agreement and the applicable State requirements governing the use of ERF.

Failure to comply with these conditions may result in termination of this Agreement. a) The Agreement between the Grantee and any Subgrantee shall require the Grantee and its Subgrantees , if any, to:
i. Perform the work in accordance with Federal, State and Local housing and building codes, as applicable.
ii. Maintain at least the minimum State-required worker' s compensation for those employees who will perform the work or any part of it. iii. Maintain, as required by law, unemployment insurance, disability insurance, and liability insurance in an amount that is reasonable to compensate any person, firm or corporation who may be injured or damaged by the Grantee or any Subgrantee in performing the Work or any part of it. iv. Agree to include and enforce all the terms of this Agreement in each subcontract.
13) Compliance with State and Federal Laws, Rules, Guidelines and Regulations The Grantee agrees to comply with all state and federal laws , rules and regulations that pertain to construction, health and safety, labor, fair employment practices, environmental protection, equal opportunity, fair housing, and all other matters applicable and/or related to the ERF program, the Grantee, its subrecipients, and all eligible activities.

Grantee shall also be responsible for obtaining any and all permits, licenses , and approvals required for performing any activities under this Agreement, including those necessary to perform design, construction, or operation and maintenance of the activities. Grantee shall be responsible for observing and complying with any applicable federal, state, and local laws, rules or regulations affecting any such work, specifically those including, but not limited to, environmental protection, procurement, and safety laws, rules, regulations, and ordinances. Grantee shall provide copies of permits and approvals to Cal ICH upon request.

Initial Here ds ----
124
14) Inspections
City of Banning
23-ERF-2-R-10022

a) Grantee shall inspect any work performed hereunder to ensure that the work is being and has been performed in accordance with the applicable federal, state a·nd/or local requirements, and this Agreement.
b) Cal ICH reserves the right to inspect any work performed hereunder to ensure that the work is being and has been performed in accordance with the applicable federal, state and/or local requirements, and this Agreement. c) Grantee agrees to require that all work that is determined based on such inspections not to conform to the applicable requirements be corrected and to withhold payments to the subrecipient until it is corrected. 15) Litigation
a) If any provision of this Agreement, or an underlying obligation, is held invalid by a court of competent jurisdiction, such invalidity, at the sole discretion of Cal ICH, shall not affect any other provisions of this Agreement and the remainder of this Agreement shall remain in full force and effect. Therefore, the provisions of this Agreement are and shall be deemed severable.
b) The Grantee shall notify Cal ICH immediately of any claim or action undertaken by or against it, which affects or may affect this Agreement or Cal ICH, and shall take such action with respect to the claim or action as is consistent with the terms of this Agreement and the interests of Cal ICH.

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125
Encampment Resolution Funding Program
Standard Agreement

EXHIBIT E

SPECIAL TERMS AND CONDITIONS
City of Banning
23-ERF-2-R-10022

1) All proceeds from any interest- bearing account established by the Grantee for the deposit of funds, along with any interest- bearing accounts opened by subrecipients to the Grantee for the deposit of funds, must be used for eligible activities and reported on as required by Cal ICH.
2) Grantee shall utilize its local Homeless Management Information System ( HMIS) to track ERF projects, services, and clients served. Grantee will ensure that HMIS data are collected in accordance with applicable laws and in such a way as to identify individual projects, services, and clients that are supported by funding ( e.g., by creating appropriate - ERF specific funding sources and project codes in HMIS).
3) Grantee shall participate in and provide data elements, including, but not limited to, health information, in a manner consistent with federal law, to the statewide Homeless Management Information System ( known as the Homeless Data Integration System or "HDIS"), in accordance with their existing Data Use Agreement entered into with the Council, if any, and as required by Health and Safety Code Section 50254. Any health information provided to, or maintained within, the statewide Homeless Management Information System shall not be subject to public inspection or disclosure under the California Public Records Act Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code). For purposes of this paragraph, " health information" means protected health information," as defined in Part 160.103 of Title 45 of the Code of Federal Regulations, and " medical information," as defined in subdivision U) of Section 56.05 of the Civil Code. The Council may, as required by operational necessity, amend or modify required data elements, disclosure formats, or disclosure frequency. Additionally, the Council, at its discretion, may provide Grantee with aggregate reports and analytics of the data Grantee submits to HDIS in support of the Purpose of this Agreement and the existing Data Use Agreement. 4) Grantee agrees to accept technical assistance as directed by Cal ICH or by a contracted technical assistance provider acting on behalf of Cal ICH. Grantee will report to Cal ICH on programmatic changes the Grantee will make as a result of the technical assistance and in support of their grant goals. 5) Grantee should establish a mechanism for people with lived experience of homelessness to have meaningful and purposeful opportunities to inform and shape all levels of planning and implementation, including through opportunities to hire people with lived experience.

Initial Here ds ---
126
City of Banning
23-ERF- 2-R-10022

6) Cal ICH maintains sole authority to determine if a Grantee is acting in compliance with the program objectives and may direct grantees to take specified actions or risk breach of this Agreement. Grantees will be provided reasonable notice and Cal ICH's discretion in making these determinations are absolute and final.

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127

Authorized Signatories Form
Encampment Resolution Funding Program (ERF)
Instructions: This form is intended to list all of the individuals who are authorized to sign Encampment Resolution Funding Program (ERF) grant documents. The Authorized Representative who signs this form must be an individual who is authorized to legally bind the awarded entity and/or payee to ERF grant agreements. The Authorized Representative is authorized to sign all ERF grant documents and may authorize additional signatories to sign ERF grant documents using the Authorized Signatories’ section below.

Grantee Information: Enter the name of the awarded entity (e.g. Sacramento CoC) and payee (e.g. Sacramento Steps Forward).

Authorized Signatories: Enter the names and title/position of the individuals authorized by the Authorized Representative to sign ERF grant documents. Each of the authorized signatories listed below must sign this form. Signatures may be wet or electronic.

PLEASE NOTE: Pursuant to California Government Code, Section 40602, for cities (including charter cities), the Authorized Representative must be the mayor of the city, or the city must include a reference to a city ordinance that delegates signing authority.

Certification: By signing this form, the Authorized Representative certifies that they are authorized to legally bind the awarded entity and/or payee to ERF grant agreements, they are authorized to sign all ERF grant documents, and the authorized signatories listed on this form are additionally authorized to sign ERF grant documents. Signatures may be wet or electronic.

Changes to this form: This form must be updated whenever the Authorized Representative or signatories change.

GRANTEE INFORMATION
Awarded Entity: City of Banning
Payee: City of Banning
Contract Number: 23-ERF-2-R-10022
128

AUTHORIZED SIGNATORIES
Name Title/Position Signature
Elizabeth Gibbs City Manager
Elizabeth Gibbs (May 12, 2026 19:30:34 PDT)
Jennifer Terry Finance Director
Mario Carlos Homeless Services Coordinator

CERTIFICATION
I certify that I am legally authorized to sign ERF grant documents and that I am additionally authorizing the above signatories to sign ERF grant documents.

Elizabeth Gibbs City Manager
Name of Authorized Representative Title
Elizabeth Gibbs (May 12, 2026 19:30:34 PDT) 05/12/2026
Signature of Authorized Representative Date
Rev 8/2025
129

2. The term of this Agreement is:

The parties mutually agree to this amendment as follows. All actions noted below are by this reference made a part of the Agreement and incorporated herein:
130
131
City of Banning
23-ERF-2-R-10022, Am. 1
(Rev. 09/2025)

EXHIBIT A
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025

AUTHORITY, PURPOSE, AND SCOPE OF WORK
1) Authority
The State of California has established the Encampment Resolution Funding Program (“ERF” or “Program”) pursuant to Chapter 7 (commencing with Section 50250) of Part 1 of Division 31 of the Health and Safety Code. Amended by SB 197 (Statutes of 2022, Chapter 70, Sec.3-8, effective June 30, 2022).

The Program is administered by the Department of Housing and Community Development (HCD)in the Business, Consumer Services and Housing Agency (“Agency”). ERF provides one-time, competitive grant funds to Continuums of Care and / or Local Jurisdictions as defined below. To date, there have been two rounds of the Encampment Resolution Funding Program. This Standard Agreement governs the Rolling Disbursement in Round 2 of the ERF Program (“ERF-2-R”). For this Standard Agreement, ERF-2-R is synonymous with “ERF” or “Program”.” and refers to programs and grantees under Health and Safety Code 50252.1(c)(1).

This Standard Agreement along with all its exhibits (“Agreement”) is entered into by HCD and a Continuum of Care or a Local Jurisdiction (“Grantee”) under the authority of, and in furtherance of, the purpose of the Program. In signing this Agreement and thereby accepting this award of funds, the Grantee agrees to comply with the terms and conditions of this Agreement, the Notice of Funding Availability (“NOFA”) under which the Grantee applied, the representations contained in the Grantee’s application, HCD guidance or directives, and the requirements appearing in the statutory authority for the Program cited above.
2) Purpose
As stated in the NOFA, the Program’s objective is to fund actionable, personcentered local proposals that resolve the experience of unsheltered homelessness for people residing in encampments. Resolving these experiences of homelessness will necessarily address the safety and wellness of people within encampments, resolve critical encampment concerns, and transition individuals into interim shelter with clear pathways to permanent housing or directly into permanent housing, using data informed, non-punitive, low-barrier, person-centered, Housing First, and coordinated approaches. These projects must comply with the principles of Housing First as defined in Welfare and Institutions Code Section 8255. Proposals may bolster existing, successful models and/or support new approaches that provide safe stable, and ultimately permanent housing for people experiencing homelessness in encampments. Expenditures shall be consistent with the legislative intent of the 132
City of Banning
23-ERF-2-R-10022, Am. 1
(Rev. 09/2025)

EXHIBIT A
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
authorizing statute to ensure the safety and wellness of people experiencing homelessness in encampments.
3) Definitions

The following Encampment Resolution Funding Program terms are defined in accordance with Health and Safety Code Section 50250, Subdivisions (a) – (m);

(a) “Additional funding round moneys” means moneys appropriated for the program in or after fiscal year 2022–23.
(b) “Agency” means the Business, Consumer Services, and Housing Agency. (c) “Applicant” means a continuum of care or local jurisdiction (d) “Continuum of Care” has the same meaning as in Section 578.3 of Title 24 of the Code of Federal Regulations.
(e) (1) “Council” means the California Interagency Council on Homelessness, previously known as the Homeless Coordinating and Financing Council created pursuant to Section 8257 of the Welfare and Institutions Code. (2) Unless context requires otherwise, “council,” with respect to the administration of this chapter on or after the effective date of the act adding this paragraph, means the department.
(f) “County” includes, but is not limited to, a city and county. (g) “Department” means the Department of Housing and Community Development (HCD).
(h) “Funding round 1 moneys” means moneys appropriated for the program in fiscal year 2021–22.
(i) “Homeless” has the same meaning as in Section 578.3 of Title 24 of the Code of Federal Regulations.
(j) “Local Jurisdiction” means a city, including a charter city, a county, including a charter county, or a city and county, including a charter city and county. (k) “Program” means the Encampment Resolution Funding program established pursuant to this chapter.
(l) “Recipient” means an applicant that receives grant funds from the council for the purposes of the program.
133
City of Banning
23-ERF-2-R-10022, Am. 1
(Rev. 09/2025)

EXHIBIT A
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
(m) “State right-of-way” means real property held in title by the State of California Additional definitions for the purposes of ERF program:
“Grantee” is “a Continuum of Care or a Local Jurisdiction that receives grant funds from the Department for the purposes of the program. Grantee is synonymous with “Recipient.”
“Subrecipients” or “Subgrantees” are entities that receive subawards from “Recipients” or “Grantees” to carry out part of the Program. “Expended” means all ERF funds obligated under contract or subcontract that have been fully paid and receipted, and no invoices remain outstanding. “Obligate” means that the Grantee has placed orders, awarded contracts, received services, or entered into similar transactions that require payment using ERF funding. Grantees must obligate the funds by the statutory deadlines set forth in this Exhibit A.
“Cal ICH” is synonymous with “Council”.
4) Scope of Work

This Scope of Work identifies the terms and conditions necessary to accomplish the Program’s intended objectives.

As detailed in Exhibit A.2, the Program’s objective is to fund grantees to implement actionable, person-centered local proposals that resolve the experience of unsheltered homelessness for people residing in encampments.

Grantees will implement their ERF funded local proposals in compliance with the terms and conditions of this Agreement, the NOFA under which the Grantee applied, the representations contained in the Grantee’s application, HCD guidance and directives, and the requirements per the authorizing statute.

Expenditures shall be consistent with the legislative intent of the authorizing statute to ensure the safety and wellness of people experiencing homelessness in encampments. Permissible eligible uses and activities are detailed below in Exhibit B, Budget Details and Disbursement Provisions. Prior to fully executing this agreement, Grantees must standardize their budget using a HCD provided budget template.
134
City of Banning
23-ERF-2-R-10022, Am. 1
(Rev. 09/2025)

EXHIBIT A
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
Grantees are expected to be close partners with HCD. This means timely and accurate reporting, candid communication of successes and challenges, and availability of persons, information, or materials.

Quarterly reporting requirements are detailed below in Exhibit D.4. Reporting, Evaluation, and Audits.

Fiscal deadlines are detailed below in Exhibit A.6. Effective Date, Term of Agreement, and Deadlines.

Grantees shall complete a Final Work Product (As detailed below in Exhibit A.6.d.) and participate in a program evaluation regarding their implementation of ERF awards. To support this effort, HCD will make Technical Assistance available.

The Department maintains sole authority to determine if a Grantee is acting in compliance with the program objectives and may direct Grantees to take specified actions or risk breach of this Agreement. Grantees will be provided reasonable notice and HCD’s discretion in making these determinations are absolute and final. 5) HCD Contract Coordinator
The Department’s Contract Coordinator for this Agreement is the Department’s Grant Development Section Chief or the Grant Development Section Chief’s designee. Unless otherwise instructed, any communication shall be conducted through email to the HCD Contractor Coordinator or their designee. If documents require an original signature, the strongly preferred form is an e-Signature in accordance with the Uniform Electronic Transactions Act (UETA). If an Awardee is unwilling or unable to sign a document electronically, Agency shall accept wet or original signed documents. These documents containing wet signatures should be both mailed to HCD and scanned and emailed as instructed. State law or policy may require the use of wet signatures for specific documents. The Representatives during the term of this Agreement will be:

PROGRAM GRANTEE
ENTITY: California Department of Housing and
Community Development City of Banning
SECTION/UNIT: Policy and Program Support
135
City of Banning
23-ERF-2-R-10022, Am. 1
(Rev. 09/2025)

EXHIBIT A
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
ADDRESS: 651 Bannon Street SW, Suite 400,
Sacramento, CA 95811
99 E. Ramsey Street,
Banning, CA 92220

CONTRACT
COORDINATOR Nichole Zaragoza-Smith Mario Carlos
PHONE
NUMBER: (916) 693-3892 (951) 922-3194
EMAIL
ADDRESS:

[email protected]
[email protected] [email protected] The Department reserves the right to change their HCD Contractor Coordinator, designee, and / or contact information at any time with reasonable notice to the Grantee.

All requests to update the Grantee information listed within this Agreement shall be emailed to HCD grant’s general email box at
[email protected].

Notice to either party may be given by email. Such notice shall be effective when received as indicated on email. Changes to HCD Contractor Coordinator, designee, and / or contact information or grantee information can be made without a formal amendment.
6) Effective Date, Term of Agreement, and Deadlines
a) This Agreement is effective upon execution by HCD, which includes signature from the Grantee and HCD. This is indicated by the HCD provided signature and date on the second page of the accompanying STD. 213, Standard Agreement. b) Performance shall start no later than 30 days, or on the express date set by HCD and the Grantees, after all approvals have been obtained and the Grant Agreement is fully executed. Should the Grantee fail to commence work at the agreed upon time, HCD, upon five (5) days written notice to the grantee, reserves the right to terminate the Agreement.
c) Grantees will continue to perform until the Agreement is terminated, including data reporting and participation in program evaluation activities, as needed. d) This Agreement will terminate on April 30, 2028.
136
City of Banning
23-ERF-2-R-10022, Am. 1
(Rev. 09/2025)

EXHIBIT A
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
Grantees shall submit a Final Work Product by April 1, 2028. The Final Work Product will include programmatic and fiscal data and a narrative on the outputs and outcomes of the program on a reporting template to be provided by HCD.

The Department will review submitted Final Work Products and collaborate with Grantees to cure any deficiencies by April 30, 2028.

Grantees are expected to continue performing until April 30, 2028. This means timely and accurate reporting, candid communication of success or shortcomings, and availability of persons, information, or materials. e) Expenditure and Obligation Deadlines:
i. Grantees shall expend no less than 50 percent and obligate 100 percent of Program funds within two fiscal years of the date of the award. ii. Grantees that have not obligated 100 percent of their Program funds within two fiscal years of the date of the award, shall submit an alternative disbursement plan to HCD for approval within 60 days of the end of the second fiscal year. This alternative disbursement plan should detail the explanation for the delay and plans for obligating 100 percent of their allocation within six months.
iii. Grantees not meeting the requirements outlined in (i) may be subject to additional corrective action, as determined by HCD.
iv. All Program funds (100 percent) shall be expended within four fiscal years of the date of the award. Any funds not expended by this date shall revert to the fund of origin pursuant to HSC Section 50253(e)(5).
7) Special Conditions
The Department maintains sole authority to determine if a Grantee is acting in compliance with the program objectives and may direct Grantees to take specified actions or risk breach of this Agreement. Grantees will be provided reasonable notice and HCD’s discretion in making these determinations are absolute and final. 137
City of Banning
23-ERF-2-R-10001, Am. 1
(Rev. 09/2025)

EXHIBIT B
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025

BUDGET DETAIL AND DISBURSEMENT PROVISIONS
1) Payee
Name: City of Banning Amount: $980,461.00
2) General Conditions Prior to Disbursement
All Grantees must submit the following completed forms prior to ERF being released:
• Request for Funds Form (“RFF”)
• STD 213 Standard Agreement form and initialed Exhibits A through E • STD 204 Payee Data Record or Government Agency Taxpayer ID Form 3) Disbursement of Funds
ERF will be disbursed to the Grantee upon receipt, review and approval of the completed Standard Agreement and RFF by HCD, the Department of General Services (DGS), and the State Controller’s Office (SCO).

The RFF must include the total amount of Program funds proposed to be expended.

The ERF will be disbursed in one allocation via mailed check once the RFF has been received by the SCO. Checks will be mailed to the address and contact name listed on the RFF.
4) Budget Details and Expenditure of Funds
The Grantee shall expend Program funds on eligible uses and activities as detailed in the submitted standardized budget. The Department reserves the right to direct specific line-item changes in the originally submitted Application budget or subsequently submitted standardized budgets.
a) Budget Changes
i) Process:

Budget modification requests should be made as part of the quarterly report process. These requests will be reviewed in the first week after quarterly reports are received. The Department may consider budget change requests outside of this process, through email as needed due to documented, exigent circumstances. Grantees carry the burden to anticipate foreseeable budget change requests and should plan accordingly.
138
City of Banning
23-ERF-2-R-10001, Am. 1
(Rev. 09/2025)

EXHIBIT B
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
The Department reserves the right to amend or adjust this process as necessary.
ii) Conditions requiring a budget modification request:

Changes may be made to the timing (e.g., fiscal year) of eligible use expenditures without prior approval by HCD so long as the total expenditures (actual and projected) for each eligible use category remain the same as approved in the standardized budget.

Any decrease or increase to the total expenditures for any eligible use category must be approved by HCD’s Grant Development Section Chief or their designee, in writing, before the Grantee may expend Program funds according to an alternative standardized budget. The Grant Development Section Chief will respond to Grantee with approval or denial of request. Failure to obtain written approval from HCD as required by this section may be considered a breach of this Agreement. A breach of this agreement may result in remedies listed below in Exhibit D.6. Breach and Remedies.

Regardless of an increase or decrease of an expenditure amount, any significant or material programmatic or fiscal change as considered by a reasonable project manager should be submitted to HCD for approval. b) Eligible Uses
Eligible uses and activities must be consistent with HSC Sections 50250 – 50254.5, other applicable laws, the terms and conditions of this Agreement, HCD guidance or directives, the NOFA under which the Grantee applied, representations contained in the Grantee’s application, and the Purpose of the Program as detailed in Exhibit A.2. Purpose.

Eligible uses and activities include, but are not limited to, the following:

Rapid Rehousing: Rapid rehousing, including housing identification services, rental subsidies, security deposits, incentives to landlords, and holding fees for eligible persons, housing search assistance, case management and facilitate access to other community-based services.
139
City of Banning
23-ERF-2-R-10001, Am. 1
(Rev. 09/2025)

EXHIBIT B
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
Operating Subsidies: Operating subsidies in new and existing affordable or supportive housing units, emergency shelters, and navigation centers. Operating subsidies may include operating reserves.

Street Outreach: Street outreach to assist eligible persons to access crisis services, interim housing options, and permanent housing and services. Services Coordination Services coordination, which may include access to workforce, education, and training programs, or other services needed to improve and promote housing stability for eligible persons, as well as direct case management services being provided to persons.

Systems Support: Systems support for activities that improve, strengthen, augment, complement, and/or are necessary to create regional partnerships and a homeless services and housing delivery system that resolves persons’ experiences of unsheltered homelessness.

Delivery of Permanent Housing: Delivery of permanent housing and innovative housing solutions, such as unit conversions that are well suited for eligible persons.

Prevention and Shelter Diversion: Prevention and shelter diversion to permanent housing, including flexible forms of financial assistance, problem solving assistance, and other services to prevent people that have been placed into permanent housing from losing their housing and falling back into unsheltered homelessness. This category is only available to serve people who were formerly residing in the prioritized ERF encampment site.

Interim Sheltering: Interim sheltering, limited to newly developed clinically enhanced congregate shelters, new or existing non-congregate shelters, and operations of existing navigation centers and shelters based on demonstrated need that are well suited for eligible persons.

Improvements to Existing Emergency Shelters: Improvements to existing emergency shelters to lower barriers, increase privacy, better address the needs of eligible persons, and improve outcomes and exits to permanent housing.

Administration: up to 5% of awarded Program funds may be applied to administrative costs.

Program funds shall not be expended on Site Restoration or other Ineligible Costs as detailed immediately below.
140
City of Banning
23-ERF-2-R-10001, Am. 1
(Rev. 09/2025)

EXHIBIT B
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
5) Ineligible Costs
ERF shall not be used for costs associated with activities in violation, conflict, or inconsistent with HSC Sections 50250 – 50254.5, other applicable laws, the terms and conditions of this Agreement, HCD guidance or directives, the NOFA under which the Grantee applied, representations contained in the Grantee’s application, and the Purpose of the Program as detailed in Exhibit A.2. Purpose.

Costs shall not be used for any use or activity that is in violation, conflict, or inconsistent with the legislative intent of the authorizing statute to ensure the safety and wellness of people experiencing homelessness in encampments.

Moreover, no parties to this contract nor their agents shall directly or indirectly use ERF awards for any use or activity that is in violation, conflict, or inconsistent with the legislative intent of the authorizing statute to ensure the safety and wellness of people experiencing homelessness in encampments. ERF funded activities that cause a traumatic effect are inconsistent with ensuring the safety and wellness of people experiencing homelessness in encampments.

The Department, at its sole and absolute discretion, shall make the final determination regarding the allowability of ERF expenditures.

The Department reserves the right to request additional clarifying information to determine the reasonableness and eligibility of all uses of the funds made available by this Agreement. If the Grantee or its funded subrecipients use ERF funds to pay for ineligible activities, the Grantee shall be required to reimburse these funds to HCD at an amount and timeframe determined by HCD.

An expenditure which is not authorized by this Agreement, or by written approval of HCD, or which cannot be adequately documented, shall be disallowed, and must be reimbursed to HCD by the Grantee at an amount and timeframe determined by HCD.

Program funds shall not be used to supplant existing local funds for homeless housing, assistance, prevention, or encampment resolution including site restoration or waste management.

Unless expressly approved by HCD in writing reimbursements are not permitted for any Program expenditures prior to this Agreement’s date of execution. 141
City of Banning
23-ERF-2-R-10001, Am. 1
(Rev. 09/2025)

EXHIBIT D
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025

GENERAL TERMS AND CONDITIONS
1) Termination and Sufficiency of Funds
a) Termination of Agreement
The Department may terminate this Agreement at any time for cause by giving a minimum of 14 days’ notice of termination, in writing, to the Grantee. Cause shall consist of violations of any conditions of this Agreement, any breach of contract as described in paragraph 6 of this Exhibit D; violation of any federal or state laws; or withdrawal of HCD’s expenditure authority. Upon termination of this Agreement, unless otherwise approved in writing by HCD, any unexpended funds received by the Grantee shall be returned to HCD within 30 days of HCD’s specified date of termination.
b) Sufficiency of Funds
This Agreement is valid and enforceable only if sufficient funds are made available to HCD by legislative appropriation. In addition, this Agreement is subject to any additional restrictions, limitations or conditions, or statutes, regulations or any other laws, whether federal or those of the State of California, or of any agency, department, or any political subdivision of the federal or State of California governments, which may affect the provisions, terms or funding of this Agreement in any manner.
2) Transfers
Grantee may not transfer or assign by subcontract or novation, or by any other means, the rights, duties, or performance of this Agreement or any part thereof, except as allowed within Exhibit D.12. (Special Conditions – Grantees/Sub Grantee) or with the prior written approval of HCD and a formal amendment to this Agreement to affect such subcontract or novation.
3) Grantee’s Application for Funds
Grantee submitted a standardized budget to HCD as part of their application for the Program.

Grantee warrants that all information, facts, assertions and representations contained in the application and approved modifications and additions thereto are true, correct, and complete to the best of Grantee’s knowledge. In the event that any part of the application and any approved modification and addition thereto is untrue, 142
City of Banning
23-ERF-2-R-10001, Am. 1
(Rev. 09/2025)

EXHIBIT D
Program Name: Encampment Resolution Funding Program
Round 2 Rolling “ERF-2-R”
NOFA Date: December 01, 2022
Prep Date: November 4, 2025
incorrect, incomplete, or misleading in such a manner that would substantially affect HCD approval, disbursement, or monitoring of the funding and the grants or activities governed by this Agreement, then HCD may declare a breach of this Agreement and take such action or pursue such remedies as are legally available. 4) Reporting, Evaluation, and Audits
a) Reporting Requirements
i. Timing and Format of Reports.

Grantee is required to provide HCD or its agents with all data and outcomes that may inform an assessment of the funded proposal. Grantees shall report quarterly and annually and have one Final Work Product submitted prior to this Agreement’s termination as outlined in HSC 50254 and 50254.5.

The quarterly reports shall be submitted on a template to be provided by HCD at least 90 days prior to the first reporting deadline. The Department may request interim reports as needed and will provide no less than 30 days’ notice to Grantees.
ii. Required Data
Grantees will be required to provide:
• Outreach and service path data at the anonymized, individual level; • Current housing status of persons served in the aggregate; • Status of funding as presented in the HCD approved, standardized budget; and
• Continued confirmation that projects receiving ERF funds are populated timely into HMIS and use HCD supplied funding codes.

The Department’s discretion in identifying which information shall be included in these reports is final.

Pursuant to HSC Section 50254, grantees shall provide data elements, including, but not limited to, health information, in a manner consistent with state and federal law, to their local Homeless Management Information System for tracking in the statewide Homeless Data Integration System. 143
City of Banning
23-ERF-2-R-10001, Am. 1
(Rev. 09/2025)