Canyon Lake City Council
August 5, 2026

CITY COUNCIL AGENDA
City of Canyon Lake, California
Wednesday, August 5, 2026
Closed Session Meeting at 5:00 P.M.

Regular Meeting at 6:30 P.M.

City Hall Council Chambers
31516 Railroad Canyon Road
Canyon Lake, CA 92587

CITY COUNCIL MEMBERS
Mayor Jeremy Smith
Mayor Pro Tem Kasey Castillo
Council Member Joshua Steeber
Council Member Mark Terry
Council Member Dale Welty
To provide remote public comment:

Click here to join via Zoom

NOTICE OF TELECONFERENCE PARTICIPATION
Pursuant to Government Code section 54953(b), Council Member Josh Steeber will participate in this meeting by teleconference from the following teleconference location:

Royal Caribbean Symphony of the Seas
Stateroom 14676
The teleconference location will be open and accessible to the public for the duration of the meeting. Members of the public may attend the meeting at this location and shall have the opportunity to hear the proceedings and directly address the City Council from the teleconference location in the same manner as members of the public attending the meeting at the regular meeting location. The agenda for this meeting has been posted at the teleconference location in accordance with the Brown Act. All votes taken during the teleconferenced meeting will be conducted by roll call.

Public Comment: Any person wishing to address the City Council on any matter within the jurisdiction of the City, whether or not it appears on this agenda, is asked to complete a speaker card and provide it to the City Clerk prior to the start of public comment. The City Council has adopted a time limit of three (3) minutes per person. Comments on specific agenda items will be heard when the item is called. Please note that if you are addressing the City Council on items NOT on the agenda, the Brown Act does not allow discussion of such items. Therefore, the City Council may only do the following: refer the matter to staff, ask for additional information or request a report back, or give a very limited factual response.

Electronic comments may be submitted to [email protected]. Comments submitted electronically will be provided to the City Council and included in the official record but will not be read aloud during the meeting.

CEQA Notice: Unless stated otherwise on the agenda, every item on the agenda is exempt from CEQA Guidelines sections 15060(c), 15061(b)(3), 15273, 15378, 15301, 15323 and/or Public Resources Code section 21065.

Council Agendas: The designated office for inspection of records is the Office of the City Clerk, Canyon Lake City Hall, 31516 Railroad Canyon Road, Canyon Lake, CA 92587. Complete agenda packets are available for public review at City Hall during normal business hours and on the City’s website at www.canyonlakeca.gov.

ADA Notice: In compliance with the Americans with Disability Act, if you need special assistance to participate in this meeting or if you need agenda documents provided in an alternate format, please contact the City Clerk’s Office at (951) 244-2955 at least 48 hours prior to the meeting to ensure that reasonable arrangements can be made.

City Council Agenda,

CLOSED SESSION

CALL TO ORDER

ROLL CALL
Castillo, Steeber, Terry, Welty, Smith
PUBLIC COMMENT (3 MINUTES)
Comments are limited to Closed Session items only. Each speaker is allowed (3) minutes to speak.

DISCUSSION ITEMS

1. CONFERENCE WITH LEGAL COUNSEL - Existing Litigation Pursuant to Government Code Section 54956.9(d)(1) Name of Case: Miguel Borja v. City of Canyon Lake, et al. Court and Case Number: Riverside County Superior Court, Case No. CVME260867

2. CONFERENCE WITH LEGAL COUNSEL - Initiation of Litigation Pursuant to Government Code Section 54956.9(d)(4): One (1) case

3. CONFERENCE WITH LEGAL COUNSEL - Anticipated Litigation, Significant Exposure Pursuant to Government Code Section 54956.9(d): One (1) case

4. PUBLIC EMPLOYEE PERFORMANCE EVALUATION - Pursuant to Government Code Section 54957: Title: City Manager

REGULAR SESSION

INVOCATION

CALL TO ORDER

ROLL CALL
Castillo, Steeber, Terry, Welty, Smith

FLAG SALUTE

CLOSED SESSION REPORT

CITY COUNCIL AND COMMITTEE REPORTS / COMMENTS

CEREMONIAL MATTERS

PRESENTATIONS
Elsinore Valley Municipal Water District
Canyon Lake Property Owners Association
Canyon Lake Chamber of Commerce
Non-Profit Spotlight
City Council Agenda,

PUBLIC COMMENT (3 MINUTES)
Comments on specific agenda items will be heard when the item is called. Comments on Consent Calendar items will be heard prior to the City Council’s consideration of that calendar. Each speaker is allowed (3) minutes to speak.

CONSENT CALENDAR
All items listed on the Consent Calendar are considered to be routine in nature and may be enacted in one motion. Individual items may be removed by a Council Member for separate discussion immediately after the adoption of the balance of the Consent Calendar. All ordinance titles are deemed to be read in their entirety and further reading waived on any ordinance listed on the Consent Calendar.

1. Approve Claims and Demands of the City
Recommendation:

Adopt Resolution No. 2026-35 Approving Claims and Demands of the City.

2. Approval of City Council Meeting Minutes
Recommendation:

Approve the minutes of the June 10, 2026, City Council meeting.

3. Receive and File the Monthly Public Records Request Report Recommendation:

Receive and file the monthly Public Records Request Report.

4. Second Reading and Adoption of Ordinance No. 278 Regulating Nitrous Oxide, Ordinance No. 279 Regulating Kratom Products and Ordinance No. 280 Regulating Drug Paraphernalia Recommendation:

Conduct second reading and adopt the following ordinances: (1) Ordinance No. 278 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 11.91 to the Canyon Lake Municipal Code Regarding the Regulation of Nitrous Oxide; (2) Ordinance No. 279 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter

11.92 to the Canyon Lake Municipal Code Regulating the Sale and Distribution of Kratom Products; and (3) Ordinance No. 280 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 11.93 to the Canyon Lake Municipal Code Regarding the Regulation of Drug Paraphernalia.

5. Second Reading and Adoption of Ordinance No. 281 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 14.03 of the Canyon Lake Municipal Code Regulating the Operation of Electric Bicycles, Electric Motorcycles, and Other Regulated Mobility Devices
Recommendation:

Conduct second reading and adopt Ordinance No. 281 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 14.03 of the Canyon Lake Municipal Code Regulating the Operation of Electric Bicycles, Electric Motorcycles, and Other Regulated Mobility Devices
City Council Agenda,

6. Second Reading and Adoption of Ordinance No. 282 - An Ordinance of the City Council of the City of Canyon Lake, California, Repealing and Replacing Chapter 9.32 (Accessory Dwelling Units) of the Canyon Lake Municipal Code to bring the City’s Accessory Dwelling Unit Ordinance into Compliance with Current State ADU Law
Recommendation:
(1) Conduct second reading and adopt Ordinance No. 282 - An Ordinance of the City Council of the City of Canyon Lake, California, Repealing and Replacing Chapter 9.32 (Accessory Dwelling Units) of the Canyon Lake Municipal Code to bring the City’s Accessory Dwelling Unit Ordinance into Compliance with Current State ADU Law; and (2) direct staff to submit the adopted ordinance to the California Department of Housing and Community Development (HCD) for review in response to the May 11, 2026, Technical Assistance Letter.

7. Approve the Appointment of the City's Alternate to the Lake Elsinore San Jacinto Watersheds Authority
Recommendation:

Approve the appointment of Council Member Welty as the City's alternate to the Lake Elsinore San Jacinto Watersheds Authority.

8. Receive and File the Quarterly Investment Report for the Quarter Ended June 30, 2026 Recommendation:

Receive and file the Quarterly Investment Report for the quarter ending June 30, 2026, in compliance with the City’s Investment Policy.

9. Consideration of a Resolution Authorizing the City Manager to Enter into a Lease/Purchase Agreement with PNC Equipment Finance, LLC, for a New Type I Fire Engine in the Amount of $1,136,301.95
Recommendation:

Adopt Resolution No. 2026-36 authorizing the City Manager to enter into a Lease/Purchase Agreement with PNC Equipment Finance, LLC, for a new Type I structural fire engine in the amount of $1,136,301.95.

10. Consideration of a Resolution Authorizing the City's Participation in the County of Riverside Urban County Program for Federal Fiscal Years 2027-2028, 2028-2029, 2029-2030 and Approving the Execution of a Cooperation Agreement with the County Recommendation:

Adopt Resolution No. 2026-37 authorizing the City's participation in the County of Riverside Urban County Program for Federal Fiscal Years 2027-2028, 2028-2029, and 2029-2030, approving the Cooperation Agreement between the County of Riverside and the City of Canyon Lake, and authorizing the City Manager to execute the agreement on the City's behalf.

11. Consideration of a Resolution Adopting the City's Amended Conflict of Interest Code Recommendation:

Adopt Resolution No. 2026-38 rescinding Resolution No. 2024-39 and adopting the City's amended Conflict of Interest Code.

City Council Agenda,

12. Consideration of a Professional Services Agreement with Animal Friends of the Valleys, Inc. for Animal Control Services
Recommendation:

Approve a Professional Services Agreement with Animal Friends of the Valleys, Inc. for animal control services in an amount not to exceed $43,050 annually and authorize the City Manager to execute the Agreement on a form acceptable to the City Attorney.

13. Consideration of a Resolution Approving Fiscal Year 2025-26 to Fiscal Year 2026-27 Expenditure Carryover Requests
Recommendation:

Adopt Resolution No. 2026-41 authorizing the carryover of Fiscal Year 2025-26 appropriations into Fiscal Year 2026-27 for the Police and Fire Departments.

PULLED CONSENT CALENDAR ITEMS
Items removed from the Consent Calendar for separate discussion will be considered at this time.

PUBLIC HEARINGS

BUSINESS ITEMS

14. Consideration of Resolutions Certifying the Initiative Petition entitled "Canyon Lake Public Safety and Emergency Response Protection Measure" and Calling a General Municipal Election and Requesting Consolidation with the County of Riverside for the Initiative Recommendation:

Adopt Resolution Nos. 2026-39 and 2026-40 certifying the sufficiency of the initiative petition entitled "Canyon Lake Public Safety and Emergency Response Protection Measure" and calling a General Municipal Election for the Initiative on November 3, 2026, requesting that the County of Riverside provide election administration services and taking all actions required by the California Elections Code.

15. Designation of a Voting Delegate and Alternate(s) for the League of California Cities 2026 Annual Conference and Expo Annual Business Meeting
Recommendation:

Designate a voting delegate and up to two alternates for the League of California Cities 2026 Annual Conference and Expo Annual Business Meeting.

CITY MANAGER COMMENTS

ANNOUNCEMENTS
The next regular City Council meeting will be held on September 9, 2026.

ADJOURNMENT
AFFIDAVIT OF POSTING: I, Sheryl L. Garcia, City Clerk of the City of Canyon Lake, California, do hereby declare that the foregoing agenda was posted as of the date noted below, at least seventy-two (72) hours prior to the meeting per Government Code 54954.2, and as required by Resolution 2019-42.

Sheryl L. Garcia, MMC, CPM
City Clerk
Dated: July 30, 2026
City Council Agenda,

City Council Agenda,

ITEM NO. 1

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Yadira Correo, Accounting Specialist
DATE: 08/05/2026
SUBJECT: Approve Claims and Demands of the City
Recommendation:

Adopt Resolution No. 2026-35 Approving Claims and Demands of the City.

Background/Analysis:

All claims and demands are reported and summarized for review and approval by the City Council on a routine basis at each City Council meeting. The attached claims represent the paid claims and demands for the period June 1 - 30, 2026.

Fiscal Impact Yes/No:No
Additional Fiscal Information:

All claims and demands are paid from appropriated funds or authorized resources of the City and have been recorded in accordance with the City’s policies.

Attachments:
1 - Resolution
2 - Claims and Demands June 2026
City Council Agenda,

RESOLUTION NO. 2026-35

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE,

CALIFORNIA, ALLOWING CERTAIN CLAIMS AND DEMANDS AS SET FORTH IN

EXHIBIT A
WHEREAS, Exhibit A was presented at the regular meeting of the City Council on August 5th, 2026, at which all present, were given an opportunity to comment.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE DOES RESOLVE AS FOLLOWS:

Section 1. The above recitals are true and correct and are incorporated herein by reference.

Section 2. Demands are approved as shown on the Demand\Warrant Register of August 5th, in the amount of $1,951,986.83 as follows:

Payroll Earnings (Direct Deposit) $171,472.19 (For Month of June) Payroll Processing Fees $703.94 (For Month of June)
Payroll Taxes - Employer & Employee $45,272.95 (For Month of June) Payroll CS $1,078.70 (For Month of June)
On-line Retirement $16,749.81 (For Month of June)
On-line Health $34,852.84 (For Month of June)
CalPERS Unfunded Accrued Liability $65,996.00 (For Month of June) Nationwide Deferred Comp. $8,299.57 (For Month of June) General $1,607,105.83 (For Month of June)
Total
$1,951,986.83
Section 3. The provisions of this Resolution are severable and if any provision, clause, sentence, word or part thereof is held illegal, invalid, unconstitutional, or inapplicable to any person or circumstances, such illegality, invalidity, unconstitutionality, or inapplicability shall not affect or impair any of the remaining provisions, clauses, sentences, sections, words or parts thereof of the Resolution or their applicability to other persons or circumstances.

Section 4. That the City Clerk shall certify to the adoption of this Resolution and that the same shall be in full force and effect.

City Council Agenda,

Section 5. This Resolution shall take effect immediately upon its adoption.

PASSED, APPROVED AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the Mayor’s signature above and certify that the City Council duly adopted this Resolution as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
City Council Agenda,

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ITEM NO. 2

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Brianna Hemsley, Executive Assistant to the City Manager DATE: 08/05/2026
SUBJECT: Approval of City Council Meeting Minutes
Recommendation:

Approve the minutes of the June 10, 2026, City Council meeting.

Background/Analysis:

Minutes of City Council meetings are prepared by the City Clerk to serve as the official record of City Council actions. City Council approval of the minutes ensures the accuracy of the record before they are entered into the City’s permanent archives.

Fiscal Impact Yes/No:No
Attachments:
1 - Minutes
City Council Agenda,

Minutes June 10, 2026

MINUTES

REGULAR MEETING OF THE

CANYON LAKE CITY COUNCIL
Canyon Lake City Hall
31516 Railroad Canyon Road
Canyon Lake, CA 92587
Wednesday, June 10, 2026
Closed Session - 5:00 p.m.

CALL TO ORDER
Mayor Smith called the meeting to order at 5:00 p.m.

ROLL CALL

Present: Mayor Pro Tem Castillo; Council Member Steeber; Council Member Terry; Council Member Welty; Mayor Smith

Absent: None

PUBLIC COMMENT
There were no public comments.

CLOSED SESSION

1. CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION - Significant Exposure to Litigation Pursuant to Paragraph (2) of Subdivision (d) of Section 54956.9: Number of Cases (1)

2. PUBLIC EMPLOYEE PERFORMANCE EVALUATION - Pursuant to Government Code Section 54957: Title: City Manager
The City Council entered Closed Session at 5:00 p.m.

Open Session - 6:30 p.m.

INVOCATION
The Invocation was led by Mark Terry.

FLAG SALUTE
Fire Chief Jeff LaTendresse led the Flag Salute.

CALL TO ORDER
Mayor Smith called the meeting to order at 6:33 p.m.

City Council Agenda,

Minutes June 10, 2026

ROLL CALL

Present: Mayor Pro Tem Castillo; Council Member Steeber; Council Member Terry; Council Member Welty; Mayor Smith

Absent: None

CLOSED SESSION REPORT
City Attorney Pacifico reported that there was no reportable action.

PUBLIC COMMENT
There were no public comments.

CONSENT CALENDAR
Council Member Steeber pulled Item No. 3 for further discussion.

Mayor Pro Tem Castillo pulled Item No. 9 for further
discussion.

Motion by Council Member Terry, second by Council Member Welty, to approve Consent Calendar Items 1-2, 4-8, and 10.

AYE: Mayor Pro Tem Castillo, Council Member Steeber, Council Member Terry, Council Member Welty, Mayor Smith
5 - 0 Carried - Unanimously

1. Approve Claims and Demands of the City
Action taken: The City Council adopted Resolution No. 2026-27 Approving Claims and Demands of the City.

2. Approval of City Council Meeting Minutes
Action taken: The City Council approved the minutes of the May 13, 2026, City Council meeting.

4. Receive and File the Budget in Brief for the FY 2026–27 Budget Action taken: The City Council received and filed the Budget in Brief in accordance with the Government Finance Officers Association Distinguished Budget Presentation award submission criteria for the FY 2026–27 Budget.

5. Consideration of a Resolution Calling the 2026 General Municipal Election, Requesting Consolidation with the County of Riverside and Adopting Candidate Statement Regulations Action taken: The City Council adopted Resolution No. 2026-28 calling for the November 3, 2026, General Municipal Election; consolidating the election with the County of Riverside; approving election administration services by the County; and adopting candidate statement regulations.

City Council Agenda,

Minutes June 10, 2026

6. Consideration of a Resolution Approving the List of Projects for Fiscal Year 2026-20267 Funded by SB 1: the Road Repair and Accountability Act of 2017 Action taken: The City Council adopted Resolution No. 2026-29 approving the Fiscal Year 2026-2027 project list for Senate Bill 1 (Road Repair and Accountability Act of 2017) Road Maintenance and Rehabilitation Account (RMRA) funding.

7. Consideration of a Resolution Adopting the Updated City Investment Policy Action taken: The City Council adopted Resolution No. 2026-30 approving the updated City Investment Policy.

8. Acceptance and Allocation of a $75,000 Public Safety Contribution from RD Canyon Lake LLC (“Higher Ground”)
Action taken: The City Council accepted the $75,000 public safety contribution from RD Canyon Lake LLC (“Higher Ground”) and adopted Resolution No. 2026-31 allocating the funds to the Police Department budget for public safety purposes.

10. Consideration of a Resolution in Support of Assembly Bill 1821 (Pacheco) – California Public Records Act: Agency Response Time
Action taken: The City Council adopted Resolution No. 2026-33 supporting Assembly Bill 1821 (Pacheco) regarding California Public Records Act response timelines.

PULLED CONSENT CALENDAR ITEMS

3. Receive and File the Monthly Public Records Request Report Council Member Steeber pulled this item for further discussion.

City Manager Brown explained that this item has been placed on the agenda to ensure Council Members are made aware of recent public records activity without having to manually search the public records database.

Action taken: The City Council received and filed the report.

9. Consideration of a Resolution Supporting S. 4505 Requiring the United States Postal Service to Designate ZIP Codes for Certain Communities Including the City of Canyon Lake Mayor Pro Tem Castillo pulled this item for further discussion.

Mayor Pro Tem Castillo commented on the numerous benefits of obtaining a unique ZIP Code for the City, noting that it is a point of community pride and expressing enthusiasm that the effort is moving forward.

Motion by Mayor Pro Tem Castillo, second by Council Member Terry, to approve Consent Calendar Item 9.

Motion carried 5-0 with Mayor Pro Tem Castillo, Council Member Steeber, Council Member Terry, Council Member Welty, and Mayor Smith voting aye.

City Council Agenda,

Minutes June 10, 2026

CITY COUNCIL AND COMMITTEE REPORTS / COMMENTS
Council Member Welty commented on the City's investment in youth programs and community investment.

Council Member Mark Terry commented on youth programs, provided a WRCOG update, and congratulated Canyon Lake resident Monica Lyons on being selected to receive the WRCOG Community Service Award.

Council Member Steeber reported on regional meetings, utility assistance programs, LEUSD achievements, e-bike legislation discussions, local community events, and extended Father's Day wishes.

Mayor Pro Tem Castillo commented that she had seen on social media that residents would like to hear from the City Attorney and City Manager regarding the Junior Lifeguard Program and deferred to the City Attorney for a response.

City Attorney Pacifico stated that the Mayor and Mayor Pro Tem have been transparent regarding their involvement with the Clear Foundation, noting that the City has no agreement with the nonprofit, and there is no conflict of interest or gift of public funds issue.

City Manager Brown noted that Council Member participation in nonprofit organizations is common and that the City routinely supports community organizations in accordance with normal business practices.

Mayor Pro Tem Castillo also commented on the strong community participation at the Canyon Lake Firefighters Association Golf Cart Show.

Mayor Smith encouraged public engagement, provided updates on the June election and Riverside County Transportation Commission actions.

Following Committee Reports, Mayor Smith requested that the nonprofit presentation be heard at this time.

Council Member Terry introduced the non-profit spotlight on behalf of the Southern California Railway Museum.

CEREMONIAL MATTERS
Mayor Smith recognized Marlon Johnson for his dedicated service to the community and congratulated him on his retirement.

Mayor Smith recognized Wyatt and Cameron of the Canyon Lake Trash Blasters for their entrepreneurial efforts.

City Council Agenda,

Minutes June 10, 2026

PRESENTATIONS
Darcy Burke provided an update on behalf of the Eastern Municipal Water District.

Board Director Jeff Bill provided an update on behalf of the Canyon Lake Property Owner’s Association.

President Johnny Pineda and Vice President/Director of Events Rick Tobin provided an update on behalf of the Canyon Lake Chamber of Commerce.

The City Council recessed at 7:52 p.m. and reconvened at 7:58 p.m.

PUBLIC HEARINGS

11. Consideration of a Resolution Establishing Emergency Medical Services (EMS) Program Fees for Fiscal Year 2026/2027 and Providing for Collection Thereof on the Property Tax Roll Mayor Smith opened the public hearing at 7:58 p.m.

City Manager Brown provided a presentation.

There was no public testimony.

Mayor Smith closed the public hearing at 7:59 p.m
Motion by Mayor Pro Tem Castillo, second by Council Member Welty, to adopt Resolution No. 2026-34 establishing emergency medical services (EMS) program fees for Fiscal Year 2026/2027 and providing for collection thereof on the property tax roll.

Motion carried 5-0 with Mayor Pro Tem Castillo, Council Member Steeber, Council Member Terry, Council Member Welty and Mayor Smith voting aye.

BUSINESS ITEMS

12. Consideration of an Agreement for Planning and Development Review Services with the City of Wildomar
City Manager Brown provided a presentation.

There were no public comments.

Motion by Mayor Smith, second by Mayor Pro Tem Castillo, to approve the agreement for planning and development review services with the City of Wildomar on a form approved by the City Attorney and authorize the City Manager to execute all documents necessary to effectuate the transaction.

AYE: Mayor Pro Tem Castillo, Council Member Steeber, Council Member Terry, Council Member Welty, Mayor Smith
5 - 0 Carried - Unanimously
City Council Agenda,

Minutes June 10, 2026

13. Introduction and First Reading of Ordinance No. 278 Regulating Nitrous Oxide, Ordinance No. 279 Regulating Kratom Products and Ordinance No. 280 Regulating Drug Paraphernalia City Attorney Pacifico provided a presentation.

There were no public comments.

Motion by Council Member Steeber, second by Mayor Smith, to waive full reading and introduce by title only the following ordinances: (1) Ordinance No. 278 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 11.91 to the Canyon Lake Municipal Code Regarding the Regulation of Nitrous Oxide; (2) Ordinance No. 279 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 11.92 to the Canyon Lake Municipal Code Regulating the Sale and Distribution of Kratom Products; and (3) Ordinance No. 280 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 11.93 to the Canyon Lake Municipal Code Regarding the Regulation of Drug Paraphernalia.

AYE: Mayor Pro Tem Castillo, Council Member Steeber, Council Member Terry, Council Member Welty, Mayor Smith
5 - 0 Carried - Unanimously

14. Introduction and First Reading of Ordinance No. 281 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 14.03 of the Canyon Lake Municipal Code Regulating the Operation of Electric Bicycles, Electric Motorcycles, and Other Regulated Mobility Devices
City Attorney Pacifico provided a presentation.

There were no public comments.

Motion by Mayor Smith, second by Council Member Steeber, to waive full reading and introduce by title only Ordinance No. 281 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 14.03 of the Canyon Lake Municipal Code Regulating the Operation of Electric Bicycles, Electric Motorcycles, and Other Regulated Mobility Devices.

AYE: Mayor Pro Tem Castillo, Council Member Steeber, Council Member Terry, Council Member Welty, Mayor Smith
5 - 0 Carried - Unanimously
City Council Agenda,

Minutes June 10, 2026

15. Introduction and First Reading of Ordinance No. 282 - An Ordinance of the City Council of the City of Canyon Lake, California, Repealing and Replacing Chapter 9.32 (Accessory Dwelling Units) of the Canyon Lake Municipal Code to bring the City’s Accessory Dwelling Unit Ordinance into Compliance with Current State ADU Law City Attorney Pacifico provided a presentation.

There were no public comments.

Motion by Mayor Smith, second by Council Member Welty, to (1) Waive full reading and introduce by title only Ordinance No. 282 - An Ordinance of the City Council of the City of Canyon Lake, California, Repealing and Replacing Chapter 9.32 (Accessory Dwelling Units) of the Canyon Lake Municipal Code to bring the City’s Accessory Dwelling Unit Ordinance into Compliance with Current State ADU Law; and (2) direct staff to submit the adopted ordinance to the California Department of Housing and Community Development (HCD) for review in response to the May 11, 2026, Technical Assistance Letter.

AYE: Mayor Pro Tem Castillo, Council Member Steeber, Council Member Terry, Council Member Welty, Mayor Smith
5 - 0 Carried - Unanimously

CITY MANAGER COMMENTS
City Manager Brown acknowledged Assistant City Attorney, Catherine Nashed for her service to the City and serving in the City Attorney's absence. City Manager Brown noted that the City will be welcoming a new Assistant City Attorney.

ANNOUNCEMENTS
The next regular City Council meeting will be held on August 5, 2026. In observance of Veterans Day, the regularly scheduled City Council meeting has been rescheduled from November 11 to November 12, 2026.

ADJOURNMENT
At 8:28 p.m., Mayor Smith adjourned the meeting.

Respectfully submitted,
Sheryl L. Garcia, MMC,
CPM City Clerk
City Council Agenda,

ITEM NO. 3

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Brianna Hemsley, Executive Assistant to the City Manager DATE: 08/05/2026
SUBJECT: Receive and File the Monthly Public Records Request Report Recommendation:

Receive and file the monthly Public Records Request Report.

Background/Analysis:

As part of the City's ongoing commitment to transparency, staff is providing a report of public records requests received between June 3, 2026, and July 1, 2026. The report identifies the requestor, the date each request was received, and the records requested. The report is intended to keep the City Council informed of public records request activity and the scope of requests received.

Fiscal Impact Yes/No:None
Attachments:
1 - Public Record Report
City Council Agenda,

Original Requests Text Request Date Requestor Name
I would like all the paperwork and approved permits for the north diningroom addition at 24020 Continental Dr., Canyon Lake 92587. I am Karen Fullner the property owner. It was approved and signed off on June 6 of 2022. 06/03/2026 01:30:59 PM Karen Fullner
Single-Topic Request: Staff Hours, Overtime, and Actual Incremental Costs Attributed to PRA Responses The May 13, 2026 City Council Staff Report (Item No. 11), authored by City Manager Arron Brown and Finance Director Terry Shea, stated that City staff spent 157.5 hours at a blended rate of $125 per hour responding to 27 Public Records Act requests from a single requestor, totaling $19,687.50 in staff costs. Those figures were presented to the City Council as justification for increased budget appropriations. This request seeks the records that support that claim, and asks the City to address a fundamental accounting question those figures raise. A QUESTION THE $19,687.50 FIGURE MUST ANSWER City employees, whether salaried or hourly, are compensated for their scheduled work hours regardless of the tasks they perform on any given day. A salaried employee who spends time responding to a PRA request costs the City the same amount as if that employee had spent the same time on any other assigned duty. The salary is a fixed cost that does not increase because of PRA work. Presenting $19,687.50 as a cost caused by the 27 PRA requests implies the City incurred expenditures it would not have otherwise incurred. That framing is only accurate if staff were paid overtime beyond their normal scheduled compensation specifically because of PRA response work. Regular salary and wage costs already budgeted and paid regardless of task assignment cannot be accurately characterized as an incremental cost attributable to any specific requestor. This distinction matters because the $19,687.50 figure was presented to the City Council as justification for additional budget appropriations. If that figure represents regular salary hours that would have been paid regardless, then presenting it as an extra cost attributable to a single requestor mischaracterizes the City's actual financial position to its own legislative body. RECORDS REQUESTED Any and all records, in whatever format they exist, used to calculate, estimate, or support the figure of 157.5 staff hours and $19,687.50 attributed to PRA responses in the May 13, 2026 Staff Report. This includes: Employee timesheets or time-tracking entries referencing PRA request work, October 1, 2024 through May 13, 2026 Payroll records or overtime logs showing any overtime compensation paid to City staff specifically attributable to PRA response work during the same period Records identifying which staff members contributed to the 157.5-hour total, their employment classification (salaried or hourly), their normal scheduled hours, and whether any portion of their time was compensated at an overtime rate Internal spreadsheets, memos, or emails used to tally or estimate staff hours across departments for purposes of the May 13 Staff Report Any document provided to or prepared by the City Manager or Finance Director reflecting the methodology used to assign a dollar value to regular staff work hours for purposes of attributing cost to a specific requestor Specifically: Please identify what portion, if any, of the $19,687.50 represents overtime wages actually paid above and beyond normal scheduled compensation, and provide the payroll records supporting that figure. If no overtime was paid, please confirm that in writing, as that confirmation is directly relevant to the accuracy of the cost figure presented to the City Council. FORMAT Please produce records in their native electronic format such as Excel, CSV, or PDF. If the City maintains time or payroll records in a tracking system, a data export is acceptable. REGARDING RESPONSE TIME This single-topic request should require minimal search time. By way of reference, Request 26-68, which asked for a comprehensive PRA log, was submitted May 11, 2026. The City requested a 14-day extension on May 21, citing the need to "complete the search and review of potentially responsive records," and closed the request on June 3 with a response that no responsive log existed. A 24-day search that yields no records, for a city of 12 staff, raises serious questions about what was actually searched. This request is narrower and a prompt response is appropriate. PRESERVATION This is a formal preservation demand. All records responsive to this request, including those on personal devices or personal accounts used for City business (City of San Jose v. Superior Court, (2017) 2 Cal.5th 608), must be preserved immediately and any auto-deletion settings suspended. FEE WAIVER A fee waiver is requested. The records sought are necessary for the public to evaluate cost figures the City placed before the City Council in a public session. The request is non-commercial. If a waiver is denied, please notify me of the estimated cost before proceeding. NOTE ON SCOPE This request is intentionally limited to a single subject. The City has previously characterized multi-part PRA requests as burdensome. This request addresses one topic only, in direct response to that concern. Please do not consolidate it with other pending requests or treat it as part of a multi-part submission. Please confirm receipt. The City has 10 days to respond under Gov. Code Section 7922.535. If any portion is unclear, please contact me before issuing a denial. IF NO RECORDS EXIST If the City's position is that no records exist to support the 157.5-hour figure, or that no overtime was paid and the figure represents only regular scheduled compensation, please confirm both in writing. That confirmation is itself responsive and material: it would establish that the $19,687.50 figure presented to the City Council did not represent any actual additional expenditure incurred by the City as a result of the 27 PRA requests Thank you CLtellthewholetruth@outlook com 06/06/2026 12:00:00 AM [email protected]
City Council Agenda,

Single-Topic Request: Whether the City Actually Paid Attorney Fees Attributed to PRA Responses, Given the Retainer Agreement and the City Attorney's Own Statements on the Record The May 13, 2026 City Council Staff Report (Item No. 11) stated that the City Attorney spent 87 hours at $246 per hour responding to 27 Public Records Act requests from a single requestor, totaling $21,402.00 in legal costs. That figure was presented to the City Council as part of the justification for increased budget appropriations. This request seeks the records behind that claim, in light of statements made by the City Attorney himself at the same meeting where those figures were discussed. WHAT THE CITY ATTORNEY SAID ON THE RECORD At the May 13, 2026 City Council meeting, the City Attorney stated on the record, in open session, that his firm had been "eating those costs" and that he was "losing money working for the city." He further stated that the firm had "not started charging the city" for PRA-related work. The City Attorney's own words directly contradict the premise of the $21,402.00 figure in the Staff Report. A retainer agreement, by its nature, covers a defined scope of legal services for a fixed monthly fee. Under a standard retainer structure, months with higher workloads are offset by months with lower workloads, and the City does not pay additional fees beyond the retainer amount unless the contract specifically provides for it. If the City Attorney confirmed on the record that his firm was absorbing those hours and had not billed the City for them, then the $21,402.00 figure does not represent money the City paid, money the City owed, or money the City would be required to pay under the existing retainer agreement. Presenting that figure to the City Council as a cost justifying additional budget appropriations, without disclosing that the amount had not been and would not be billed, is a material omission. RECORDS REQUESTED Any and all records, in whatever format they exist, related to City Attorney billing, invoicing, and retainer payments for the period October 1, 2024 through the date this request is fulfilled. This includes: The current retainer agreement or legal services contract between the City and its City Attorney, including any amendments, addenda, or fee schedules All invoices submitted by the City Attorney to the City for the period October 1, 2024 through May 13, 2026, including any invoices that itemize PRA-related work All payments made by the City to the City Attorney during the same period, including the amount, date, and description of services covered by each payment Any written communication between the City Attorney and City staff or the City Manager regarding whether PRA-related work would be billed separately or absorbed under the retainer Any invoice, supplemental billing, or demand for payment from the City Attorney specifically attributing costs to PRA requests during the covered period Specifically: Please confirm in writing whether the City has received any invoice from the City Attorney that separately itemizes or charges for the 87 hours or $21,402.00 referenced in the May 13, 2026 Staff Report, and whether any payment beyond the standard retainer fee has been made or is anticipated as a result of PRA-related work. If no such invoice exists and no additional payment has been made or obligated, please confirm that in writing. FORMAT Please produce records in their native electronic format such as PDF or Excel. Billing records may be redacted to remove privileged attorney-client communications, but invoice amounts, payment dates, retainer terms, and any line items referencing PRA work must be produced. REGARDING RESPONSE TIME This single-topic request should require minimal search time. By way of reference, Request 26-68, which asked for a comprehensive PRA log, was submitted May 11, 2026. The City requested a 14-day extension on May 21, citing the need to "complete the search and review of potentially responsive records," and closed the request on June 3 with a response that no responsive log existed. A 24-day search that yields no records, for a city of 12 staff, raises serious questions about what was actually searched. This request is narrower and a prompt response is appropriate. PRESERVATION This is a formal preservation demand. All records responsive to this request, including those on personal devices or personal accounts used for City business (City of San Jose v. Superior Court, (2017) 2 Cal.5th 608), must be preserved immediately and any auto-deletion settings suspended. FEE WAIVER A fee waiver is requested. The records sought are necessary for the public to evaluate cost figures the City placed before the City Council in a public session. The request is non-commercial. If a waiver is denied, please notify me of the estimated cost before proceeding. NOTE ON SCOPE This request is intentionally limited to a single subject. The City has previously characterized multi-part PRA requests as burdensome. This request addresses one topic only, in direct response to that concern. Please do not consolidate it with other pending requests or treat it as part of a multi-part submission. Please confirm receipt. The City has 10 days to respond under Gov. Code Section 7922.535. If any portion is unclear, please contact me before issuing a denial. IF NO ADDITIONAL BILLING EXISTS If the City confirms that no invoice for PRA-related work beyond the standard retainer has been submitted or paid, that confirmation establishes that the $21,402.00 figure in the May 13, 2026 Staff Report did not represent an actual cost incurred or to be incurred by the City The City Council and the public were entitled to know that distinction when the figure was presented as justification for additional appropriations The public continues to be 06/06/2026 12:00:00 AM [email protected]
City Council Agenda,

Single-Topic: PRA Compliance Costs Across All Requestors, Not Only the One Identified in Item No. 11 The May 13, 2026 City Council Staff Report (Item No. 11) attributed $41,089.50 in PRA compliance costs to a single requestor's 27 requests. That report was presented to the City Council and the public without any comparison to the City's overall PRA workload during the same period. The omission of that context is significant. Public records indicate that the City received a total of 223 PRA requests during the 18-month period from October 2024 through March 2026. The requestor identified in the May 13 Staff Report submitted 27 of those requests, meaning the remaining 196 requests came from other members of the public during that same period. The City nonetheless chose to present cost figures for only one requestor to its City Council while omitting any accounting of the time and cost associated with the other 196 requests. When one requestor represents roughly 12 percent of total PRA volume over 18 months, singling out that requestor as the source of an extraordinary financial burden, while presenting no comparative data for the other 88 percent of requests, is not a complete or accurate picture of the City's PRA workload. The public and the City Council are entitled to the full picture. Without knowing what PRA compliance cost the City across all requestors during the same period, it is impossible to evaluate whether the figures in the Staff Report represent an unusual burden or whether the City's overall PRA workload is distributed broadly and the singling out of one requestor was selective and misleading. RECORDS REQUESTED Whatever records, logs, spreadsheets, timesheets, billing entries, or tracking documents the City maintains, in any format, reflecting staff time, attorney time, or total cost attributed to all PRA requests received from any requestor during the period October 1, 2024 through the date this request is fulfilled. This includes: Any log, spreadsheet, or database reflecting PRA requests received, staff hours expended, attorney hours expended, or costs attributed, for the full covered period across all requestors Time entries, invoices, or billing records for all PRA-related work during the covered period, not limited to the 27 requests discussed in Item No. 11 Any summary or report prepared for internal use reflecting overall PRA volume, staff hours, or cost during the covered period Any records that would allow a comparison of time and cost attributed to individual requestors across the full period The City need not produce a formatted log if none exists in that form. Whatever underlying records exist, including timesheets, invoices, emails, or system exports, in their native format are sufficient. Personal identifying information for requestors may be redacted consistent with the standard the City applied when publishing the 27 requests in the May 13 agenda packet. WHY THIS CONTEXT IS ESSENTIAL If the City tracked staff time and cost for the 27 requests attributed to one requestor but maintained no equivalent records for the 223 requests submitted by all other members of the public during the same period, that selective tracking is itself a fact the public has a right to know. It would indicate the City devoted administrative resources to building a cost case against one specific requestor while conducting no equivalent accounting for its broader PRA workload. If, on the other hand, the City does maintain time and cost records for all PRA requests, those records must be produced. The public is entitled to the same level of transparency for the full workload that the City chose to apply selectively to one requestor in a public council presentation. FORMAT Native electronic format preferred such as Excel, CSV, or PDF. If records exist only in a software system, a data export is acceptable. REGARDING RESPONSE TIME This single-topic request should require minimal search time. By way of reference, Request 26-68, which asked for a comprehensive PRA log, was submitted May 11, 2026. The City requested a 14-day extension on May 21, citing the need to "complete the search and review of potentially responsive records," and closed the request on June 3 with a response that no responsive log existed. A 24-day search that yields no records, for a city of 12 staff, raises serious questions about what was actually searched. This request is narrower and a prompt response is appropriate. PRESERVATION This is a formal preservation demand. All records responsive to this request, including those on personal devices or personal accounts used for City business (City of San Jose v. Superior Court, (2017) 2 Cal.5th 608), must be preserved immediately and any auto-deletion settings suspended. FEE WAIVER A fee waiver is requested. The records sought are necessary for the public to evaluate cost figures the City placed before the City Council in a public session. The request is non-commercial. If a waiver is denied, please notify me of the estimated cost before proceeding. NOTE ON SCOPE This request is intentionally limited to a single subject. The City has previously characterized multi-part PRA requests as burdensome. This request addresses one topic only, in direct response to that concern. Please do not consolidate it with other pending requests or treat it as part of a multi-part submission. Please confirm receipt. The City has 10 days to respond under Gov. Code Section 7922.535. If any portion is unclear, please contact me before issuing a denial. IF NO RECORDS EXIST If the City maintains no records tracking PRA compliance time or cost for any requestor other than the one identified in Item No 11 please confirm that in writing That confirmation would establish that the City selectively built and maintained a cost record for one requestor while 06/06/2026 12:00:00 AM [email protected]
SmartProcure is submitting a public records request to City of Canyon Lake for any and all purchasing records from 3/11/2026 to current. The request is limited to readily available records without physically copying, scanning, or printing paper documents. Any editable electronic document is acceptable. The specific information requested from your recordkeeping system is: Purchase order number. If purchase orders are not used a comparable substitute is acceptable, i.e., invoice, encumbrance, or check number Purchase date Line item details (Detailed description of the purchase) Line item quantity Line item price Vendor ID number, name, address, contact person and their email address If applicable, please include any available department or school identifier such as a location code, organization code, or function code, ship code to help us distinguish records within a consolidated file for the City, County, Township, or School District If you would like to let me know what type of financial software you use, I may have report samples that help to determine how, or if, you are able to respond. As an added security and privacy measure, there will be a unique upload link for any new requests moving forward, including this one. We appreciate your assistance towards this request. You may also attach the information to this email. https://upload smartprocure com/?id=c2RqPWEyYlZQMDAwMDAxMUpsS1lBVSZzdD1DQSZvcmc9Q2l0eU9mQ2FueW9uTGFrZSZvcmdpZD01MjYx 06/08/2026 01:00:58 AM Lisa Chatar
Fire department, local health department or environmental division, local planning or building department, or other other municipality records relating to unauthorized dumping/landfilling activities, hazardous materials, spills or leaks, or petroleum storage tanks on the following property or immediate surrounding areas: 17545 FM 306 Canyon Lake, TX
06/12/2026 01:08:01 PM Briana Garcia
Need a fire report for PROPERTY 23831 CRUISE CIRCLE DR, CANYON LAKE CA 92587 for the fire that had happened at the property above on 11/25/2024. 06/15/2026 03:54:11 PM Mike Simms
SmartProcure respectfully requests copies of any current or most recently active contracts between City of Canyon Lake and the following vendors: 1. Riverside County Sheriff Dept Lake Elsinore 2. Motorola Solutions Inc 3. Complete Paperles 4. John Hancock Usa 5. Code Group 6. Riverside County Executive Office 7. Cole Huber 8. Cort 9. Berg Print And Mail 10. Pzl If any such contracts exist, I would appreciate receiving the associated documentation that includes the following details: -The names of the contracting parties -A description of the nature and purpose of the contract -The contract’s start and end dates -The total value or cost of the contract -Any amendments, extensions, or renewals related to the contract If the requested records are available in digital format, I would prefer to receive them electronically via email. If you are not the appropriate custodian of these records, please forward this request to the correct department or individual. If these records are available through an online portal, database, or website, please provide the direct link along with any instructions necessary to access or locate the relevant materials. If any part of this request needs to be clarified or narrowed to assist in locating the records, I’m happy to work with you on that. I truly appreciate your time and assistance in helping me access this information. Regards, Amber Petraites Customer Relations Specialist SmartProcure Direct: (954) 314-2797 5000 T-Rex Ave, Suite. 200, Boca Raton, FL 33431 06/18/2026 12:00:00 AM Amber Petraites
City Council Agenda,

Hi, Pursuant to the California Public Records Act, I request all purchase orders and/or payment records for non-person/vendor such as companies, organizations, and contractors from 01/01/2025 to the present date. Examples of relevant reports/records may include: Check Registers, Procurement Reports, Standard PO detail Reports, Warrant/Claims Reports, and Purchase order history reports, among others. This request excludes payroll, employee reimbursements, stipends, and other personnel-related payments. If available, please include: • Vendor Name • Purchase Date • Description of Purchase • Quantity • Line item Amount We prefer the records in CSV or Excel/XLSX format because they are easier to work with. PDF would be less ideal, especially scanned PDFs, but we understand if that is the only format available. If there are any fees associated with fulfilling this request, please inform me in advance. Should you need further information or clarification to expedite this request, do not hesitate to reach out. Thank you for your attention and cooperation. I look forward to your prompt response within the statutory period. Regards, Abbas Khan CEO, Civic IQ Inc 50 Harrison St, PH 505 Hoboken NJ 07030 +1 201-287-4709 06/23/2026 12:00:00 AM Abbas Khan
Railroad Canyon Rd Canyon Lake, CA 92587 United States cross road 30600–30614 Sorrel Ln Canyon Lake, CA 92587 United States need camera footage from all cameras at the light date 06/15/2026 time 3pm to 4pm 06/25/2026 03:58:47 PM Tyler Money
Looking for original historical geotechnical reports, soil engineering reports, or core sample data taken during the initial tract/lot development for this property. 06/27/2026 02:46:35 PM Brandon T Harmison
I would like to know if there are any permits that were gotten from when my house was built for roofing. I’m trying to find out if the roof on my house is the original roof or at sometime they did a re roof. 1985 to 2011 06/28/2026 08:06:27 AM Stefanie Svensson
Dear Canyon Lake city, This is a request for public records made under CPRA and the common law right of access. Please confirm receipt of this message. Kindly send all responsive documents electronically — either by replying directly or emailing the address below. This unique address helps me organize my requests, so please use it exactly as shown: [email protected] Records requested: Please send the final and compiled bid tabulation (bid tally), including all quantities and unit pricing for each bidder, for 'Railroad Canyon Road' that was submitted on 12/03/2020. I believe the project number is '31540-42', but I could be mistaken. If so, please use the project name and date to lookup the responsive documents. We specifically request the line-item bid tabulation showing each material, quantity, unit, and unit price for every bidder. If no such line-item tally was created, please provide the full bid submissions from each contractor. A grand total sheet alone is not sufficient to satisfy this request unless it was a lump sum bid. Below is an example of the format we are looking for that the engineer usually creates at the completion of the bid: BIDDER 1 BIDDER 2 Item # Material Quantity Unit UNIT PRICE TOTAL UNIT PRICE TOTAL 1 ... ... ... ... ... ... ... GRAND TOTAL GRAND TOTAL Common law access / Public interest justification / Fee waivers: My public interest justification is as follows: Bid tabulations obtained through this request are made publicly available at no cost. This ensures that taxpayers, businesses, journalists, and policymakers have free access to procurement data that impacts public funds. Transparency and accountability: Publicly available bid results help prevent overpricing, bid-rigging, and favoritism in public contracts. Support for small businesses: Many firms, especially small and minority-owned businesses, rely on bid history to compete fairly in government contracting. Cost savings for taxpayers: Open access to bid tabulations promotes competition, leading to more cost-effective government spending. Attestations: I am a citizen of the United States and affirm my full name and contact information is true and correct. I have not been convicted of any indictable offense under the laws of any state whatsoever nor the United States. I, or another person, will use the requested government records for a commercial purpose; however, the responsive records themselves will be posted online and made available to the public free of charge. I am not seeking records in connection with a legal proceeding. Compliance Matters: Should you need it, my mailing address is 66 Main St #55, Farmingdale, NJ 07727, and my phone number is (732) 444-7051. For any compliance matters or other questions *not related* to the responsive record, please email our general counsel at legal[at]govrecordrequest.com. Please do not send responsive records to that address. Thank you! Yours faithfully, Mark Zurada Esq. 06/28/2026 12:00:00 AM Mark Zurada Esq.

We request all records, including executed contracts, purchase orders, invoices, and solicitation/RFP documents for products or services purchased from ESS/ESI, Kokua Education, Scoot Education, Zed Educate, and BuildEd, covering the past three years to present. Spreadsheet exports preferred; PDF, Word, or standard ERP/finance reports also work. This is a commercial research request, and we're happy to narrow or clarify the scope to ease fulfillment. 07/01/2026 07:46:04 AM Woo Park
Dear City Clerk / Public Records Officer, This is a California Public Records Act request for public, non-exempt business license or business registration records maintained by the City of Canyon Lake. Please provide the records in CSV, Excel, or another machine-readable format, if available. I am requesting only public and disclosable information. Please exclude home-based business addresses, residential addresses, personal phone numbers, personal email addresses, SSNs, EINs, dates of birth, payment data, and any other exempt or confidential information. Requested fields, to the extent maintained and publicly disclosable: - Business name - License / registration / account number - Business type / category / NAICS / SIC, if maintained - Public business address - Public business phone number - Public business website or domain - Public business email address, if maintained as a public business contact - Owner / registrant / entity name, only if public and not exempt - Issue date, start date, effective date, expiration date, renewal date, and active / inactive status - Date the record was last updated, if maintained Date range requested: 1. Current active business licenses / registrations; and 2. Newly issued, renewed, closed, suspended, or expired licenses / registrations from January 1, 2024 through the date of search. Before taking any action that would require a fee, please provide a written estimate and wait for my written approval. Please do not proceed with any paid production unless I approve the fee in writing first. If these records are already available through an official online bulk download, open data portal, or public report, please send the direct link instead of producing duplicate records. Thank you. 07/01/2026 12:00:00 AM Marco Sai-Kit Wu
Dear Colleagues, We are asking for your help in identifying any local tobacco-related policy changes in your jurisdiction or in the jurisdictions covered by your agency. We are contracted by the California Department of Public Health, California Tobacco Prevention Program, to maintain the state’s tobacco Policy Evaluation Tracking System (PETS). PETS supports local tobacco prevention efforts by cities and counties across the state. Specifically, we’re looking for: Policies passed since January 2026 (or currently under consideration) that address: Smokefree air in multi-unit housing Secondhand smoke and smokefree air in outdoor spaces Retail sales of tobacco or nicotine-containing products Including tobacco retail licensing (TRL) ordinances and restrictions on tobacco or nicotine products, such as flavored tobacco products Other tobacco control policies, such as policies to reduce tobacco product waste or prohibit the sale of electronic cigarettes. (We do not need specific actions such as grandfathering an individual tobacco licensee.) The current amount of the local tobacco retailer license fee If you have not made any changes to your local tobacco control laws since January 2026, there is no need to send us any information. We’ve made it easy to submit information using our new policy collection form, available here: https://petsordinancecollection.fillout.com/newpolicies. You can use the form to upload PDFs of ordinances or resolutions, or provide links. If you don’t have the full text of the policy or a link, please share any details that will help us identify the policy, such as: Ordinance/resolution number or title Date of passage or meeting(s) where it was discussed Jurisdiction name with TRL fee amount Thank you for your time and continued partnership in protecting public health across California! Please don’t hesitate to reach out to Alisa Padon at [email protected] with any questions. Sincerely, The PETS team Kiara Gonzalez Pronouns: She | Her | Ella Health Equity Program Manager Prevention Policy Group @ the Public Health Institute DONATE TODAY! 2000 Center Street, Ste 308 Berkeley CA 94704 323 314 2653
07/01/2026 12:00:00 AM Kiara Gonzalez
City Council Agenda,

ITEM NO. 4

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Arron Brown, City Manager
DATE: 08/05/2026
SUBJECT: Second Reading and Adoption of Ordinance No. 278 Regulating Nitrous Oxide, Ordinance No. 279 Regulating Kratom Products and Ordinance No. 280 Regulating Drug Paraphernalia
Recommendation:

Conduct second reading and adopt the following ordinances: (1) Ordinance No. 278 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 11.91 to the Canyon Lake Municipal Code Regarding the Regulation of Nitrous Oxide; (2) Ordinance No. 279 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 11.92 to the Canyon Lake Municipal Code Regulating the Sale and Distribution of Kratom Products; and (3) Ordinance No. 280 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 11.93 to the Canyon Lake Municipal Code Regarding the Regulation of Drug Paraphernalia.

Background/Analysis:

At the June 10, 2026, City Council meeting, the City Council approved the first reading of ordinances regulating nitrous oxide, the sale and distribution of kratom products and the sale of drug paraphernalia. The three ordinances presented for introduction are intended to address emerging public health and public safety concerns associated with the retail sale, display, distribution, and marketing of nitrous oxide products, kratom products, and drug paraphernalia within the City.

The proposed nitrous oxide ordinance would add Chapter 11.91 to the Canyon Lake Municipal Code. Nitrous oxide has legitimate medical, dental, culinary, industrial, automotive, and commercial uses, but it is also subject to recreational misuse as an intoxicating substance. The ordinance generally prohibits the sale, distribution, furnishing, or transfer of nitrous oxide, devices used to dispense or administer nitrous oxide, or devices containing nitrous oxide, except where the transaction falls within specified lawful exemptions. Those exemptions include food products using nitrous oxide as a propellant, lawful wholesale transactions, vehicle performance products sold by licensed retailers, medical and dental uses, pharmacy-related uses, and other circumstances exempted by state or federal law. The ordinance also includes provisions for product seizure, evidence handling, disposal, business license and permit remedies, cost recovery, and cumulative enforcement remedies.

The proposed kratom ordinance would add Chapter 11.92 to the Canyon Lake Municipal Code.

The ordinance addresses public health and safety concerns associated with kratom products and products containing hydroxymitragynine, commonly known as 7-OH. The ordinance would prohibit the sale, distribution, furnishing, or giving away of kratom products or 7-OH products to persons under 21 years of age; require age verification; prohibit products with a 7-OH level greater than two percent of the total kratom alkaloids; prohibit products that are attractive to children; and prohibit the sale or possession for sale of products containing synthesized or semi-synthesized City Council Agenda,

kratom alkaloids, constituents, or derivatives. The ordinance also includes product seizure, evidence, and disposal provisions, as well as misdemeanor/infraction authority, administrative citation, civil enforcement, nuisance abatement, business license and permit remedies, and cost recovery.

The proposed drug paraphernalia ordinance would add Chapter 11.93 to the Canyon Lake Municipal Code. The ordinance is designed to supplement state law by establishing local business, operational, nuisance, and enforcement standards for businesses that sell, display, market, distribute, or furnish drug paraphernalia. The ordinance recognizes that drug paraphernalia retailers may contribute to unlawful drug activity, nuisance conditions, public health risks, calls for service, loitering, property crime, and other adverse secondary impacts. The ordinance prohibits unlawful sales and displays, prohibits sales to minors, restricts public-facing displays, requires compliance with applicable business licensing and land use approvals, and establishes operational standards such as video surveillance, restricted hours of operation, controlled product access, property maintenance, and lawful inspections. Violations may be addressed through criminal, administrative, civil, nuisance abatement, business license, permit, and cost recovery remedies.

Collectively, these ordinances are intended to provide the City with practical enforcement tools before problematic retail activity becomes established or expands within the City. The ordinances are not intended to prohibit lawful medical, dental, culinary, industrial, automotive, pharmaceutical, or other legitimate uses where those uses are protected by state or federal law. Instead, they are tailored to address unlawful or harmful sales, marketing, display, distribution, and retail practices that may facilitate drug abuse, youth access, nuisance conditions, and other adverse impacts on the community.

Fiscal Impact Yes/No:No
Additional Fiscal Information:

There is no direct fiscal impact associated with introduction of the ordinances. If adopted, implementation may require staff time for education, inspection, investigation, and enforcement. The ordinances include cost recovery provisions intended to allow the City to recover eligible enforcement, abatement, storage, disposal, administrative, and related costs to the extent authorized by the Municipal Code and applicable law.

Attachments:
1 - Ordinance NOX
2 - Ordinance Kratom
3 - Ordinance Drug Paraphernalia
City Council Agenda,

ORDINANCE NO. 278

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, ADDING CHAPTER 11.91 TO THE CANYON LAKE MUNICIPAL CODE

REGARDING THE REGULATION OF NITROUS OXIDE
WHEREAS, Nitrous Oxide, commonly known as “laughing gas,” is a colorless, nonflammable gas used in medical, industrial, automotive, and food preparation settings, yet its misuse presents significant health and safety risks; and
WHEREAS, the recreational use of Nitrous Oxide has been linked to serious health consequences, including physical illness, neurological harm, mental health impacts, injury, and death; and WHEREAS, although Nitrous Oxide has legitimate commercial, culinary, medical, dental, and automotive uses, it is also subject to misuse and abuse as an intoxicating substance; and WHEREAS, Nitrous Oxide products and devices may be purchased from retail vendors and, absent local regulation, remain susceptible to sale or distribution to persons intending unlawful misuse; and
WHEREAS, the City Council of the City of Canyon Lake desires to regulate the sale and distribution of Nitrous Oxide in order to protect the public health, safety, and welfare and to deter the sale or distribution of Nitrous Oxide products for unlawful inhalation or other unlawful purposes; and
WHEREAS, the City Council finds that adoption of this Ordinance is a proper exercise of the City’s police powers to protect the public health, safety, and welfare.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, DOES ORDAIN AS FOLLOWS:

Section 1. Recitals. The foregoing recitals are true and correct and are incorporated herein by this reference. The City Council expressly finds that the facts set forth in the recitals constitute the facts establishing the urgency for adoption of this Ordinance.

Section 2. Findings and Purpose. The City Council finds that Nitrous Oxide misuse presents significant risks to the public health, safety, and welfare. Nitrous Oxide is capable of lawful use in food preparation, medical and dental settings, and certain commercial and automotive applications.

However, the City Council further finds that Nitrous Oxide is also subject to recreational misuse and abuse, and that local regulation is necessary to reduce its availability for unlawful use and to protect the community.

Section 3. Municipal Code Amendment. Chapter 11.91 of the Canyon Lake Municipal Code is hereby added to read as follows:

City Council Agenda,

CHAPTER 11.91

REGULATION OF NITROUS OXIDE

11.91.010 Definitions.

As used in this Chapter, the following terms shall have the following meanings:
“Device” means any cartridge, compressed gas cylinder, apparatus, container, balloon, attachment, nozzle, or other object used to contain, dispense, or administer Nitrous Oxide. “Nitrous Oxide” means the colorless nonflammable gas sometimes identified as N2O, which is sometimes used in aerosols and sometimes used as an anesthetic, and which, when inhaled, produces loss of sensibility to pain, often preceded by exhilaration and laughter. Nitrous Oxide is often informally or colloquially referred to as “laughing gas,” “NOX,” “galaxy gas,” and “whippits,” among others.
“Person” means any individual or legal entity however constituted or organized. “Wholesale capacity” means the sale or distribution of Nitrous Oxide, or a device to dispense or administer Nitrous Oxide, to a person or entity that will use the Nitrous Oxide or device in services or products for resale or in a lawful commercial, medical, dental, industrial, automotive, or culinary operation. Examples include, but are not limited to, commercial sale of dentistry supplies to dentists or dentistry offices, commercial sale of devices for use in food production or in a commercial kitchen, and commercial sale of Nitrous Oxide for the purpose of producing food products for commercial sale, including whipped cream canisters.

11.91.020 Prohibition on Sale or Distribution of Nitrous Oxide.

Except as otherwise authorized by law or allowed under this Chapter, it is unlawful for any Person to sell, attempt to sell, offer for sale, distribute, furnish, provide, or otherwise transfer to any Person Nitrous Oxide, a device to dispense or administer Nitrous Oxide, or any device that contains any quantity of Nitrous Oxide.

11.91.030 Exemptions to Prohibitions.

This Chapter does not apply to the sale, attempted sale, offer for sale, distribution, furnishing, provision, or other transfer of Nitrous Oxide, or a device containing, dispensing, or administering Nitrous Oxide, in any of the following exempt circumstances:

A. The Nitrous Oxide is contained in a food product for use as a propellant.

B. The Nitrous Oxide or device is sold, attempted to be sold, offered for sale, distributed, furnished, provided, or otherwise transferred in a wholesale capacity for lawful commercial, medical, dental, industrial, automotive, or culinary purposes. This exemption shall not apply if the seller, distributor, or provider knows or has reason to know that the recipient intends to use the City Council Agenda,

Nitrous Oxide or device in violation of California Penal Code section 381b or any other applicable law.

C. The Nitrous Oxide or device is specifically designed for use in a vehicle to enhance the performance of the vehicle, is sold by a licensed retailer, and is flavorless.

D. The Nitrous Oxide is sold, attempted to be sold, offered for sale, distributed, furnished, provided, or otherwise transferred specifically for the purpose of providing medical or dental care by, or at the direction and under the supervision of, a medical or dental practitioner licensed by the State of California and in accordance with all applicable laws, rules, and regulations.

E. The Nitrous Oxide or device is sold, attempted to be sold, offered for sale, distributed, furnished, provided, or otherwise transferred by a pharmacist, pharmacist intern, or pharmacy, as those terms are defined by the California Business and Professions Code, as may be amended, in the course of lawful pharmacy duties, or by wholesalers licensed by the California State Board of Pharmacy.

F. Any other circumstance exempted under state or federal law.

Any sale, distribution, furnishing, provision, or transfer of Nitrous Oxide contemplated under this section shall comply with all applicable documentation, recordkeeping, and transaction requirements set forth in California Penal Code section 381e, as may be amended, and any other applicable law.

11.91.040 Product Seizure, Evidence, and Disposal.

A. Any Nitrous Oxide, device to dispense or administer Nitrous Oxide, device that contains any quantity of Nitrous Oxide, package, container, advertisement, record, document, or other item that is sold, offered for sale, provided, distributed, furnished, possessed for sale, marketed, labeled, displayed, stored, or maintained in violation of this Chapter may be seized, impounded, held as evidence, or otherwise handled in accordance with applicable law.

B. Any item seized pursuant to this Chapter shall be handled in accordance with applicable law enforcement, code enforcement, evidentiary, property, and due process requirements, including any applicable requirements governing notice, storage, retention, release, forfeiture, destruction, or disposal.

C. Upon a final administrative, civil, or criminal determination that any seized item violates this Chapter, or upon other lawful authorization, such item may be destroyed or otherwise disposed of in a manner approved by the Chief of Police or designee and consistent with applicable law.

D. Nothing in this section limits, supersedes, or restricts the authority of any peace officer, code enforcement officer, or other authorized enforcement official to seize contraband, evidence, or other property pursuant to any other provision of this Code, state law, federal law, warrant, court order, consent, exigent circumstance, or other lawful authority.

City Council Agenda,

11.91.050 Business License and Permit Remedies.

A. A violation of this Chapter may constitute grounds for denial, suspension, revocation, or nonrenewal of any City business license, business tax certificate, permit, entitlement, approval, or other City authorization held by or requested by the violator, to the extent authorized by this Code and applicable law.

B. To the extent authorized by this Code and applicable law, the City may withhold issuance or renewal of a City business license, business tax certificate, permit, entitlement, approval, or other City authorization for any business, responsible party, or property where violations of this Chapter have occurred until the violations are corrected and all final penalties, fines, administrative citations, abatement costs, storage costs, disposal costs, and other recoverable costs have been paid.

C. Any denial, suspension, revocation, nonrenewal, or withholding of a City business license, business tax certificate, permit, entitlement, approval, or other City authorization pursuant to this section shall be carried out in accordance with all applicable notice, hearing, appeal, and due process requirements under this Code and applicable law.

11.91.060 Cost Recovery.

A. The City may recover all costs reasonably incurred in investigating, enforcing, prosecuting, and abating violations of this Chapter, including, but not limited to, staff time, inspection costs, enforcement costs, administrative costs, attorneys’ fees where authorized by law, abatement costs, storage costs, disposal costs, and any other costs recoverable under this Code or applicable law.

B. Costs recoverable under this section may be recovered through any procedure authorized by this Code or applicable law, including administrative proceedings, civil action, nuisance abatement proceedings, collection against a responsible party, or any other lawful method.

C. Recovery of costs pursuant to this section shall be cumulative and shall not limit the City’s ability to pursue any other remedy, penalty, fine, fee, charge, lien, assessment, or enforcement mechanism authorized by this Code or applicable law.

11.91.070 Violations and Enforcement.

A. Any Person violating any provision of this Chapter may be charged as a misdemeanor or an infraction, at the discretion of the City Attorney or other official authorized by law. In the event a misdemeanor charge is filed, the City Attorney is authorized, to the extent permitted by law, to reduce the charge to an infraction.

B. In addition to, or in lieu of, criminal enforcement, violations of this Chapter may be enforced by administrative citation, civil action, injunctive relief, nuisance abatement, business license or permit remedies, cost recovery, or any other administrative, civil, or criminal remedy authorized by this Code or applicable law.

City Council Agenda,

C. A violation of this Chapter may be punished as a misdemeanor by a fine not exceeding one thousand dollars, by imprisonment in the County jail for a period not exceeding six months, or by both such fine and imprisonment, to the extent permitted by law. A violation charged as an infraction shall be punishable as provided by law.

D. Each day that a violation continues shall constitute a separate offense.

E. The remedies provided in this Chapter are cumulative and not exclusive. Nothing in this Chapter shall be construed to limit any other remedy, penalty, or enforcement authority available to the City under this Code or applicable law.

Section 4. Clerical Errors. The City Council directs the City Clerk to correct any clerical errors found in this Ordinance, including, but not limited to, typographical errors, irregular numbering, and incorrect section references.

Section 5. Severability. Should any section, subsection, clause, or provision of this Ordinance for any reason be held to be invalid or unconstitutional, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this Ordinance; it being hereby expressly declared that this Ordinance, and each section, subsection, sentence, clause, and phrase hereof would have been prepared, proposed, approved, and ratified irrespective of the fact that any one or more sections, subsections, sentences, clauses, or phrases be declared invalid, unenforceable, or unconstitutional.

Section 6. Effective Date. This Ordinance shall take effect and be in force thirty (30) days from passage and adoption.
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Section 7. Publication. The City Clerk shall cause the Ordinance or a summary thereof to be published in accordance with state law.

PASSED, APPROVED, AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the Mayor’s signature above and certify that the City Council duly adopted this Ordinance as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
APPROVED AS TO FORM:
_________________________
Steven Pacifico, City Attorney
City Council Agenda,

ORDINANCE NO. 279

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, ADDING CHAPTER 11.92 REGULATING THE SALE AND

DISTRIBUTION OF KRATOM PRODUCTS
WHEREAS, kratom (Mitragyna speciosa) and products containing hydroxymitragynine (also known as 7-OH) have raised public health and public safety concerns relating to potency, dependency, youth access, impaired driving, and marketing practices attractive to children; and WHEREAS, the City Council of the City of Canyon Lake desires to protect the public safety, health, and welfare of the City’s residents by adopting local regulations consistent with the regional-approach provided for under Riverside County Ordinance No. 1004; and WHEREAS, the City Council finds that adoption of this Ordinance is a proper exercise of the City’s police powers to protect the public safety, health, and welfare.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, DOES ORDAIN AS FOLLOWS:

Section 1. Recitals. The foregoing recitals are true and correct and are incorporated herein by this reference. The City Council expressly finds that the facts set forth in the recitals constitute the facts establishing the urgency for adoption of this Ordinance.

Section 2. Findings and Purpose. It is the intent of the City Council to prohibit the sale, distribution, or possession of kratom and hydroxymitragynine (also known as 7-OH) products within the City of Canyon Lake that contain more than 2% of 7-OH in the alkaloid fraction, recognizing the significant health risks associated with elevated concentrations of this alkaloid.

Kratom (mitragyna speciosa) is a tropical tree native to Southeast Asia, and its leaves are often consumed in powdered or extract form for their stimulant and sedative effects. The active compounds in kratom include mitragynine and 7-OH. While mitragynine is present in higher concentrations, 7-OH is more potent and is largely responsible for the stronger pain-relieving, sedative, and euphoric effects.

Research has shown 7-OH has euphoric and mood-enhancing effects, particularly at higher doses, which can increase its appeal for recreational use. Research has also shown that 7-OH binds to opioid receptors in the brain with greater affinity than morphine, making it significantly more powerful in relieving pain. This greater potency raises significant concerns about its safety profile, especially regarding the potential for addiction, overdose, and adverse physical and psychological effects, including nausea, vomiting, and potential psychosis. These risks are compounded when products contain higher concentrations of 7-OH.

Health advisories have raised concerns over the safety of kratom products, particularly those with higher concentrations of 7-OH, which may increase the potential for abuse and harm to public health. The United States Food and Drug Administration (FDA) has issued several warning letters City Council Agenda,

to various companies for illegally marketing products containing enhanced levels of 7-OH culminating in a formal request to the U.S. Drug Enforcement Administration (DEA) on July 29, 2025, to place 7-OH products on the controlled substance list.

Health officials, including the FDA, have raised concerns over the safety of kratom products, particularly those with higher concentrations of 7-OH, which may increase the potential for abuse and harm to public health.

At least one county in California, and several cities in California, has recently taken steps to regulate or ban kratom products, recognizing the need to protect public safety, especially among vulnerable populations.

The City Council, in its commitment to safeguarding the health and well-being of its residents by ensuring that products available for sale do not pose undue health risks, hereby restricts the sale and distribution of kratom and 7-OH products containing more than 2% of 7-OH in the alkaloid fraction, thereby reducing potential risks to public health and safety.

Section 3. Municipal Code Amendment. Chapter 11.92 of the Canyon Lake Municipal Code is hereby adopted as follows:

CHAPTER 11.92

REGULATION OF KRATOM PRODUCTS

11.92.010 Definitions.

As used in this Chapter, the following terms shall have the following meanings:
“7-OH product” means a product containing hydroxymitragynine. “Attractive to children” means any of the following:

1. Use of images that are attractive to children, including, but not limited to, images of any of the following, except as part of required health warnings:
a. Cartoons, toys, or robots.
b. Any real or fictional humans.
c. Fictional animals or creatures.
d. Fruits or vegetables, except when used to accurately describe ingredients or flavors contained in a product.

2. Likeness to images, characters, or phrases that are popularly used to advertise to children.

City Council Agenda,

3. Imitation of candy packaging or labeling, or other packaging and labeling of cereals, sweets, chips, or other food products typically marketed to children.

4. The terms “candy” or “candies” or variants in spelling such as “kandy” or “kandee.”

5. Brand names or close imitations of brand names of candies, cereals, sweets, chips, or other food products typically marketed to children.

6. Any other image or packaging that is easily confused with commercially available foods that do not contain kratom and are typically marketed to children.

7. Any other packaging used that is attractive to children considering all relevant facts and circumstances.
“Kratom leaf” means the leaf of the kratom plant, also known as mitragyna speciosa, in any form.
“Kratom leaf extract” means the material obtained by extraction of kratom leaves by any means. “Kratom product” means a product consisting of kratom leaf, kratom leaf extract, or both; any part of a leaf of the plant mitragyna speciosa in fresh, dehydrated or dried form or a kratom extract or any product that contains any kratom alkaloid or metabolite. “Semi-synthesized” means an alkaloid, alkaloid derivative, kratom constituent, or kratom derivative that has been chemically or biosynthetically converted, altered, enhanced, concentrated, or otherwise modified from a naturally occurring kratom alkaloid or constituent, including through a process that confers a structural change in the alkaloid or constituent. “Synthesized” means an alkaloid or alkaloid derivative that has been created by chemical synthesis or biosynthetic means (including but not limited to: fermentation, recombinant techniques, yeast derived enzymatic techniques) rather than traditional food preparation techniques such as heating or extracting. It also includes alkaloids that have been further exposed to chemicals or processes that would confer a structural change in the alkaloids contained within the extract. “Total kratom alkaloids” means the sum of mitragynine, speciociliatine, speciogynine, paynantheine, and 7-OH in a kratom product.

11.92.020 Prohibition on Sale and Distribution of Kratom and 7-OH Products.

A. Except as otherwise authorized by law, an individual, business, or other entity shall not sell, attempt to sell, offer for sale, provide, furnish, give away, or distribute a kratom product or 7- OH product to a person under twenty-one (21) years of age.

B. Except as otherwise authorized by law, an individual, business, or other entity shall not sell, attempt to sell, offer for sale, provide, furnish, give away, or distribute a kratom product or 7- City Council Agenda,

OH product with a level of 7-OH that is greater than two percent (2%) of the total kratom alkaloids in the product.

C. Except as otherwise authorized by law, an individual, business, or other entity shall not sell, attempt to sell, offer for sale, provide, furnish, give away, or distribute a kratom product or 7- OH product that is attractive to children.

D. Any individual, business, or other entity that sells, attempts to sell, offers for sale, provides, furnishes, gives away, or distributes a kratom product or 7-OH product shall conduct age verification to ensure compliance with subsection A.

E. Except as otherwise authorized by law, no individual, business, or other entity shall sell, attempt to sell, offer for sale, provide, furnish, give away, distribute, possess for sale, market, label, display, or maintain for sale any kratom product or 7-OH product that contains or is adulterated with synthesized or semi-synthesized kratom alkaloids, kratom constituents, or kratom derivatives.

11.92.030 Violations and Penalties.

A. Any person or entity violating any provision of this Chapter may be charged as a misdemeanor or an infraction, at the discretion of the City Attorney or other official authorized by law. In the event a misdemeanor charge is filed, the City Attorney is authorized, to the extent permitted by law, to reduce the charge to an infraction.

B. In addition to, or in lieu of, criminal enforcement, violations of this Chapter may be enforced by administrative citation, civil action, injunctive relief, nuisance abatement, or any other administrative, civil, equitable, or criminal remedy authorized by the Canyon Lake Municipal Code or other applicable law.

C. A violation of this Chapter may be punished as a misdemeanor by a fine not exceeding one thousand dollars ($1,000.00), or by imprisonment in the County jail for a period not exceeding six (6) months, or by both such fine and imprisonment, to the extent permitted by law. A violation charged as an infraction shall be punishable as provided by law.

D. Each person or entity that violates this Chapter is guilty of a separate offense for each and every day, or portion thereof, during which the violation is committed, continued, maintained, or permitted.

E. The remedies provided in this Chapter are cumulative and not exclusive, and nothing in this Chapter shall preclude the City from pursuing any other remedy or penalty authorized by the Canyon Lake Municipal Code or applicable law.

11.92.040 Product Seizure, Evidence, and Disposal.

A. Any kratom product, 7-OH product, synthesized or semi-synthesized kratom alkaloid product, package, container, advertisement, record, document, or other item that is sold, offered for sale, provided, furnished, distributed, possessed for sale, marketed, labeled, displayed, or City Council Agenda,

maintained in violation of this Chapter may be seized, impounded, held as evidence, or otherwise handled in accordance with applicable law.

B. Any item seized pursuant to this Chapter shall be handled in accordance with applicable law enforcement, code enforcement, evidentiary, administrative, and due process requirements.

C. Upon a final administrative, civil, or criminal determination that a seized product or item violates this Chapter, or upon other lawful authorization, such product or item may be destroyed or otherwise disposed of in a manner approved by the Chief of Police or designee and consistent with applicable law.

D. Nothing in this section limits the authority of a peace officer, code enforcement officer, or other authorized enforcement official to seize contraband, evidence, or other property pursuant to any other applicable law.

11.92.050 Business License and Permit Remedies.

A. A violation of this Chapter may constitute grounds for denial, suspension, revocation, or nonrenewal of any City business license, business tax certificate, permit, entitlement, approval, or other City authorization held by or requested by the violator, to the extent authorized by this Code and applicable law.

B. The City may withhold issuance or renewal of a City business license, business tax certificate, permit, entitlement, approval, or other City authorization for any business or property where violations of this Chapter have occurred until all violations are corrected and all final penalties, fines, and recoverable administrative costs have been paid, to the extent authorized by this Code and applicable law.

C. The remedies set forth in this section are cumulative and shall not limit the City’s authority to impose any other administrative, civil, criminal, licensing, permitting, or nuisance abatement remedy available under this Code or applicable law.

11.92.060 Cost Recovery.

A. The City may recover all costs incurred in investigating, enforcing, prosecuting, and abating violations of this Chapter, including, but not limited to, staff time, inspection costs, attorneys’ fees where authorized by law, administrative costs, abatement costs, storage costs, testing costs, disposal costs, and any other costs recoverable under this Code or applicable law.

B. Cost recovery under this section may be pursued by administrative process, civil action, collection action, nuisance abatement proceeding, lien, special assessment, or any other method authorized by this Code or applicable law.

Section 4. Clerical Errors. The City Council directs the City Clerk to correct any clerical errors found in this Ordinance, including, but not limited to, typographical errors, irregular numbering, and incorrect section references.

City Council Agenda,

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Section 5. Severability. Should any section, subsection, clause, or provision of this Ordinance for any reason be held to be invalid or unconstitutional, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this Ordinance; it being hereby expressly declared that this Ordinance, and each section, subsection, sentence, clause, and phrase hereof would have been prepared, proposed, approved, and ratified irrespective of the fact that any one or more sections, subsections, sentences, clauses, or phrases be declared invalid, unenforceable, or unconstitutional.

Section 6. Effective Date. This Ordinance shall take effect and be in force thirty (30) days from passage and adoption.

Section 7. Publication. The City Clerk shall cause the Ordinance or a summary thereof to be published in accordance with state law.

PASSED, APPROVED, AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the Mayor’s signature above and certify that the City Council duly adopted this Ordinance as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
APPROVED AS TO FORM:
_________________________
Steven Pacifico, City Attorney
City Council Agenda,

ORDINANCE NO. 280

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, ADDING CHAPTER 11.93 TO THE CANYON LAKE MUNICIPAL CODE

REGARDING THE REGULATION OF DRUG PARAPHERNALIA
WHEREAS, the Canyon Lake is authorized pursuant to Article XI, Section 7 of the California Constitution to make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws; and
WHEREAS, the City has a substantial interest in protecting the public health, safety, and welfare of its residents, businesses, visitors, and neighborhoods; and WHEREAS, the City Council finds that the proliferation of businesses selling, marketing, displaying, or distributing drug paraphernalia contributes to unlawful drug activity, blight, nuisance conditions, criminal conduct, public health risks, and negative secondary impacts affecting surrounding properties and neighborhoods; and WHEREAS, the City Council further finds that certain retailers intentionally market products designed or primarily intended for the ingestion, inhalation, injection, cultivation, manufacture, concealment, processing, or use of controlled substances, including methamphetamine, fentanyl, heroin, cocaine, and unlawfully possessed narcotics; and WHEREAS, the City Council finds that businesses engaged in the sale or display of drug paraphernalia are frequently associated with increased calls for service, loitering, narcotics activity, property crime, public consumption of controlled substances, litter, hazardous waste, and threats to public safety; and
WHEREAS, the City Council finds that methamphetamine use in particular is associated with dangerous and highly addictive behavior, violent criminal conduct, severe public health impacts, homelessness, environmental contamination, and increased burdens on law enforcement, fire, emergency medical services, hospitals, code enforcement, and other public resources; and WHEREAS, the City Council further finds that fentanyl and opioid-related overdoses continue to present an escalating public health and safety crisis throughout California and Riverside County, including impacts on youth and vulnerable populations; and WHEREAS, the City Council finds that businesses engaged in the sale of drug paraphernalia frequently attempt to market such products as “novelty items,” “collectibles,” or “for tobacco use only,” while nevertheless displaying, advertising, packaging, promoting, or selling such products in a manner commonly associated with unlawful controlled substance use; and WHEREAS, the City Council finds that state law, including California Health and Safety Code sections 111.934 through 111.934.7, regulates drug paraphernalia, but does not fully occupy the field of local land use, business licensing, nuisance abatement, administrative enforcement, and City Council Agenda,

local regulatory controls intended to address the secondary impacts associated with such activities; and
WHEREAS, the City Council intends this Ordinance to supplement, and not conflict with, state and federal law.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, DOES ORDAIN AS FOLLOWS:

Section 1. Recitals. The foregoing recitals are true and correct and are incorporated herein by this reference. The City Council expressly finds that the facts set forth in the recitals constitute the facts establishing the urgency for adoption of this Ordinance.

Section 2. Findings and Purpose. The City Council hereby finds and declares that the sale, display, marketing, distribution, and furnishing of drug paraphernalia contributes to and facilitates unlawful drug activity and creates substantial adverse impacts on the public health, safety, and welfare of the community. The purpose and intent of this Chapter are to:
(i) Protect the public health, safety, and welfare;
(ii) Reduce unlawful drug activity and related nuisance conditions; (iii) Protect neighborhoods, businesses, and public spaces from the adverse secondary effects associated with drug paraphernalia retailers;
(iv) Establish reasonable operational regulations and enforcement standards for businesses engaged in the sale or display of drug paraphernalia;
(v) Provide comprehensive enforcement tools and remedies to ensure compliance with this Chapter;
(vi) Supplement state law and support local law enforcement and nuisance abatement efforts; and
(vii) Preserve the quality of life, economic vitality, and community character of the City.

Section 3. Municipal Code Amendment. Chapter 11.93 of the Canyon Lake Municipal Code is hereby added to read as follows:

CHAPTER 11.93

DRUG PARAPHERNALIA RETAIL REGULATIONS

11.93.010 Definitions.

For purposes of this Chapter, the following definitions shall apply:
“Drug paraphernalia” shall have the same meaning as set forth in California Health and Safety Code section 11014.5, as may be amended.
“Drug paraphernalia retailer” means any person or business entity that sells, offers for sale, displays, distributes, furnishes, markets, or possesses for sale any drug paraphernalia.

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“Person” means any individual, firm, partnership, association, corporation, limited liability company, or other entity.
“Premises” means any building, structure, location, parcel, tenant space, or portion thereof used for commercial purposes.
“Controlled substance” shall have the meaning set forth in the California Health and Safety Code.
“Public nuisance” means any condition prohibited by this Chapter and any activity declared to be a nuisance pursuant to this Code or applicable law.

11.93.020 Prohibited Acts.

A. No person shall knowingly sell, offer for sale, display, furnish, market, distribute, or possess with intent to sell any drug paraphernalia in violation of state law or this Chapter.

B. No person shall operate a drug paraphernalia retailer without all required City business licenses, land use approvals, permits, and any other approvals required by federal, state, or local law.

C. No person shall display drug paraphernalia in a manner visible from a public right-ofway or from outside the premises.

D. No person shall permit the sale, display, or furnishing of drug paraphernalia to any person under eighteen (18) years of age.

E. No person shall maintain a premises in a manner that facilitates unlawful controlled substance activity, loitering, narcotics transactions, public consumption of controlled substances, or other criminal conduct.

F. No person shall knowingly market products using terminology, imagery, labeling, or advertising associated with unlawful drug consumption or use.

11.93.030 Operational Requirements.

A. All drug paraphernalia retailers shall maintain a valid City business license and comply with all zoning requirements applicable to the premises.

B. Drug paraphernalia retailers shall maintain continuous video surveillance covering all interior customer areas and all entrances and exits. Recordings shall be retained for a minimum of ninety (90) days and provided to the City upon lawful request.

C. No drug paraphernalia retailer shall operate between the hours of 10:00 p.m. and 6:00 a.m.

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D. Drug paraphernalia shall be maintained behind the sales counter or within locked display cases inaccessible to customers without employee assistance.

E. The premises shall be maintained free of graffiti, litter, drug-related waste, hazardous materials, and nuisance conditions.

F. The operator shall permit lawful inspections by City officials during business hours.

11.93.040 Public Nuisance Declared.

Any violation of this Chapter is hereby declared unlawful and a public nuisance.

11.93.050 Business License and Permit Remedies.

A. A violation of this Chapter may constitute grounds for denial, suspension, revocation, or nonrenewal of any City business license, business tax certificate, permit, entitlement, approval, or other City authorization held by or requested by the violator, to the extent authorized by this Code and applicable law.

B. To the extent authorized by this Code and applicable law, the City may withhold issuance or renewal of a City business license, business tax certificate, permit, entitlement, approval, or other City authorization for any business, responsible party, or property where violations of this Chapter have occurred until the violations are corrected and all final penalties, fines, administrative citations, abatement costs, storage costs, disposal costs, and other recoverable costs have been paid.

C. Any denial, suspension, revocation, nonrenewal, or withholding of a City business license, business tax certificate, permit, entitlement, approval, or other City authorization pursuant to this section shall be carried out in accordance with all applicable notice, hearing, appeal, and due process requirements under this Code and applicable law.

11.93.060 Cost Recovery.

A. The City may recover all costs reasonably incurred in investigating, enforcing, prosecuting, and abating violations of this Chapter, including, but not limited to, staff time, inspection costs, enforcement costs, administrative costs, attorneys’ fees where authorized by law, abatement costs, storage costs, disposal costs, and any other costs recoverable under this Code or applicable law.

B. Costs recoverable under this section may be recovered through any procedure authorized by this Code or applicable law, including administrative proceedings, civil action, nuisance abatement proceedings, collection against a responsible party, or any other lawful method.

C. Recovery of costs pursuant to this section shall be cumulative and shall not limit the City’s ability to pursue any other remedy, penalty, fine, fee, charge, lien, assessment, or enforcement mechanism authorized by this Code or applicable law.

City Council Agenda,

11.93.070 Violations and Enforcement.

A. Any Person violating any provision of this Chapter may be charged as a misdemeanor or an infraction, at the discretion of the City Attorney or other official authorized by law. In the event a misdemeanor charge is filed, the City Attorney is authorized, to the extent permitted by law, to reduce the charge to an infraction.

B. In addition to, or in lieu of, criminal enforcement, violations of this Chapter may be enforced by administrative citation, civil action, injunctive relief, nuisance abatement, business license or permit remedies, cost recovery, or any other administrative, civil, or criminal remedy authorized by this Code or applicable law.

C. A violation of this Chapter may be punished as a misdemeanor by a fine not exceeding one thousand dollars, by imprisonment in the County jail for a period not exceeding six months, or by both such fine and imprisonment, to the extent permitted by law. A violation charged as an infraction shall be punishable as provided by law.

D. Each day that a violation continues shall constitute a separate offense.

E. The remedies provided in this Chapter are cumulative and not exclusive. Nothing in this Chapter shall be construed to limit any other remedy, penalty, or enforcement authority available to the City under this Code or applicable law.

Section 4. Clerical Errors. The City Council directs the City Clerk to correct any clerical errors found in this Ordinance, including, but not limited to, typographical errors, irregular numbering, and incorrect section references.

Section 5. Severability. Should any section, subsection, clause, or provision of this Ordinance for any reason be held to be invalid or unconstitutional, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this Ordinance; it being hereby expressly declared that this Ordinance, and each section, subsection, sentence, clause, and phrase hereof would have been prepared, proposed, approved, and ratified irrespective of the fact that any one or more sections, subsections, sentences, clauses, or phrases be declared invalid, unenforceable, or unconstitutional.

Section 6. Effective Date. This Ordinance shall take effect and be in force thirty (30) days from passage and adoption.

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Section 7. Publication. The City Clerk shall cause the Ordinance or a summary thereof to be published in accordance with state law.

PASSED, APPROVED, AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the Mayor’s signature above and certify that the City Council duly adopted this Ordinance as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
APPROVED AS TO FORM:
_________________________
Steven Pacifico, City Attorney
City Council Agenda,

ITEM NO. 5

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Arron Brown, City Manager
DATE: 08/05/2026
SUBJECT: Second Reading and Adoption of Ordinance No. 281 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 14.03 of the Canyon Lake Municipal Code Regulating the Operation of Electric Bicycles, Electric Motorcycles, and Other Regulated Mobility Devices
Recommendation:

Conduct second reading and adopt Ordinance No. 281 - An Ordinance of the City Council of the City of Canyon Lake, California, Adding Chapter 14.03 of the Canyon Lake Municipal Code Regulating the Operation of Electric Bicycles, Electric Motorcycles, and Other Regulated Mobility Devices Background/Analysis:

At the June 10, 2026, City Council meeting, the City Council approved the first reading of Ordinance No. 281. The proposed ordinance would add Chapter 14.03 to the Canyon Lake Municipal Code to establish local regulations governing the operation of electric bicycles, electric motorcycles, and other regulated mobility devices. The ordinance is intended to supplement, and not conflict with, the California Vehicle Code or other applicable state or federal law.

The ordinance establishes definitions for regulated mobility devices, electric bicycles, electric motorcycles, noncompliant electric vehicles, pedestrian facilities, bicycle facilities, public facilities, private roads, private common areas, private commercial areas, and authorized private enforcement areas. These definitions are intended to address the increasing variety of devices being operated in the community, including high-powered electric motorcycles and off-highway electric motorcycles that may be marketed or operated as “e-bikes” even though they do not meet the California Vehicle Code definition of an electric bicycle.

The ordinance would prohibit unsafe operation of regulated mobility devices, including reckless or careless operation, unsafe speeds, failure to yield, riding against traffic, stunts, wheelies, jumps, racing, speed contests, unsafe group riding, unsafe passing, carrying passengers or objects in an unsafe manner, towing or clinging to vehicles, distracted operation, operation under the influence where prohibited by state law, and conduct that intentionally or recklessly frightens, harasses, or threatens others. It also restricts operation on sidewalks and pedestrian facilities, in parks and public facilities, and on trails or pathways where prohibited by signage or City designation. The City Manager would be authorized to designate City-controlled areas where operation is prohibited or subject to additional restrictions based on public safety, congestion, special events, maintenance, emergency conditions, or other operational concerns.

The ordinance also addresses electric motorcycles and noncompliant electric vehicles. It prohibits operation of electric motorcycles, off-highway electric motorcycles, motor-driven cycles, and City Council Agenda,

noncompliant electric vehicles on public streets, sidewalks, pedestrian facilities, bicycle facilities, parks, trails, public facilities, private roads, private parking facilities, private common areas, private commercial areas, or authorized private enforcement areas unless the operation is authorized by the California Vehicle Code and the vehicle is lawfully registered, licensed, equipped, identified, and operated for that location. The ordinance further prohibits modifying an electric bicycle so that it exceeds applicable speed, power, pedal, or equipment limits under state law, and prohibits representing or treating a noncompliant device as an electric bicycle.

Because Canyon Lake includes substantial privately owned and privately controlled areas, the ordinance includes a specific framework for private-property enforcement. Under that framework, the City may enforce the ordinance on private roads, private common areas, private recreational areas, parking facilities, parks, beaches, trails, pathways, gates, security areas, and similar areas only after the responsible private entity has adopted substantially consistent rules or incorporated the City’s rules by reference, has filed a written request or consent in a form approved by the City Attorney, has installed required signs and notices, and the City Manager or designee has determined that the area is appropriate for enforcement and placed it on a list of authorized private enforcement areas maintained by the City Clerk. The ordinance preserves private enforcement authority and makes clear that City acceptance of a private-property enforcement request does not create a mandatory duty to provide patrol, dedicated enforcement, security services, or any particular level of enforcement.

The ordinance includes enforcement tools such as administrative citations, infraction citations, misdemeanor prosecution where warranted, public nuisance abatement, removal, seizure, impoundment, cost recovery, and other civil, administrative, or criminal remedies. It also authorizes, where permitted by state law, removal or seizure of devices in specified public safety circumstances and includes procedures for notice, release, safety-course completion, proof of ownership, parental involvement for minors, and recovery of lawful administrative, towing, storage, or related charges. The ordinance further establishes parental or guardian responsibility where a parent or guardian authorizes, knowingly permits, or fails to take reasonable steps to prevent a minor from violating the chapter.

Fiscal Impact Yes/No:No
Additional Fiscal Information:

There is no direct fiscal impact associated with introduction of the ordinances. If adopted, implementation may require staff time for education, inspection, investigation, and enforcement. The ordinances include cost recovery provisions intended to allow the City to recover eligible enforcement, abatement, storage, disposal, administrative, and related costs to the extent authorized by the Municipal Code and applicable law.

Attachments:
1 - Ordinance
City Council Agenda,

ORDINANCE NO. 281

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, ADDING CHAPTER 14.03 OF THE CANYON LAKE MUNICIPAL CODE

REGULATING THE OPERATION OF ELECTRIC BICYCLES, ELECTRIC

MOTORCYCLES, AND OTHER REGULATED MOBILITY DEVICES
WHEREAS, the use of electric bicycles, motorized scooters, electrically motorized boards, electric personal assistive mobility devices, low-speed vehicles, shared mobility devices, electric motorcycles, off-highway electric motorcycles, and similar devices has increased within the City; and
WHEREAS, improperly operated electric bicycles, electric motorcycles, and other regulated mobility devices can create public safety hazards for pedestrians, motorists, bicyclists, children, seniors, persons with disabilities, equestrians, golf cart operators, and other users of streets, sidewalks, parks, pathways, private roads, parking lots, trails, public facilities, private recreational facilities, and commercial areas; and
WHEREAS, certain high-powered electric motorcycles and off-highway electric motorcycles are sometimes marketed, described, modified, or operated as “e-bikes,” even though they do not meet the California Vehicle Code definition of an electric bicycle; and WHEREAS, the City Council desires to establish clear, enforceable standards for safe operation, including restrictions on unsafe riding, sidewalk operation, park and public facility use, passenger carrying, racing, stunts, group riding, operation of unlawful electric motorcycles, and operation of noncompliant electric vehicles; and
WHEREAS, the City Council finds that this ordinance is necessary to protect the public health, safety, and welfare and is a reasonable exercise of the City’s police power.

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

Section 1. Recitals. The foregoing recitals are true and correct and are incorporated herein by this reference. The City Council expressly finds that the facts set forth in the recitals constitute the facts establishing the urgency for adoption of this Ordinance.

Section 2. CEQA. The City Council finds that this ordinance is exempt from review under the California Environmental Quality Act pursuant to CEQA Guidelines sections 15061(b)(3) because the ordinance consists of general public safety regulations, enforcement procedures, and organizational provisions, and it can be seen with certainty that there is no possibility that the ordinance will have a significant effect on the environment.

Section 3. Municipal Code Amendment. Chapter 14.03, “Operation of Regulated Mobility Devices,” is hereby added to the Canyon Lake Municipal Code to read as follows:

City Council Agenda,

Chapter 14.03

OPERATION OF REGULATED MOBILITY DEVICES

14.03.010 Definitions.

For purposes of this chapter, the following definitions shall apply:
“Authorized private enforcement area” means private property, a private road, a private parking facility, a private common area, a private recreational area, a private commercial area, or other private property within the City where the owner, operator, association, or authorized representative has adopted regulations substantially consistent with this chapter, has requested or consented to City enforcement, has entered into any agreement required by the City, has installed required signs, and has satisfied all applicable requirements of this chapter. “Bicycle” has the same meaning as in California Vehicle Code section 231. “Bicycle facility” means any public or private improvement, infrastructure, lane, path, route, trail, or area designed, designated, or operated primarily for use by bicycles, electric bicycles, or other regulated mobility devices, whether separated from or shared with other modes of travel. “Class 1 electric bicycle,” “Class 2 electric bicycle,” and “Class 3 electric bicycle” have the same meanings as in California Vehicle Code section 312.5.
“Electric bicycle” has the same meaning as in California Vehicle Code section 312.5. “Electric motorcycle” means a motorcycle, motor-driven cycle, off-highway electric motorcycle, electric off-highway vehicle, or other electric vehicle that is not an electric bicycle, motorized scooter, electric personal assistive mobility device, or electrically motorized board under the California Vehicle Code, and that is powered in whole or in part by an electric motor. “Electric personal assistive mobility device” has the same meaning as in California Vehicle Code section 313.
“Electrically motorized board” has the same meaning as in California Vehicle Code section 313.5.
“Motorized scooter” has the same meaning as in California Vehicle Code section 407.5. “Noncompliant electric vehicle” means any electric vehicle, electric motorcycle, off-highway electric motorcycle, motor-driven cycle, or similar device that is not lawfully registered, licensed, equipped, identified, or operated as required by the California Vehicle Code, or that is advertised, labeled, modified, or operated as an electric bicycle but does not satisfy the California Vehicle Code definition of an electric bicycle.
“Operator” means any person who operates, rides, drives, propels, controls, or has actual physical control of a regulated mobility device.

City Council Agenda,

“Owner or operator” means the owner, operator, manager, association, property owners association, common interest development board of directors, commercial association, merchant association, managing agent, or other person or entity with legal authority to regulate the private property, private road, private parking facility, private common area, private commercial area, or private recreational area at issue.
“Pedestrian facility” means any public or private improvement, infrastructure, or space designed, designated, or operated primarily for use by pedestrians, including persons using mobility aids such as wheelchairs, walkers, or strollers, and includes sidewalks, pedestrian paths, pedestrian ways, crosswalks, plazas, walkways, and similar areas.
“Private commercial area” means privately owned or maintained property used for commercial, retail, office, service, restaurant, parking, drive aisle, pedestrian access, or related purposes. “Private common area” means private property owned, maintained, operated, or regulated by a common interest development, property owners association, homeowners association, or similar entity for the use or benefit of members, residents, guests, invitees, or the public. “Private parking facility” means a privately owned and maintained off-street parking facility, parking lot, parking structure, drive aisle, access road, or related circulation area. “Private road” means a privately owned and maintained road, street, lane, drive, access road, or similar vehicular travel way within the City.
“Public area” means any outdoor area open to members of the public for public use, whether owned, leased, maintained, operated, or controlled by the City or by another public or private entity, to the fullest extent regulation by the City is permitted by law. “Public facility” means any City-owned, City-leased, City-maintained, City-operated, or Citycontrolled building, park, playground, sports court, athletic field, trail, pathway, parking lot, drainage facility, culvert, channel, open space, or other public property. “Regulated mobility device” means a bicycle, electric bicycle, electric personal assistive mobility device, electrically motorized board, motorized scooter, shared mobility device, and any other similar wheeled device or vehicle, whether powered by human power, electric power, or a combination thereof. “Regulated mobility device” does not include a mobility device used by a person with a disability in a manner protected by federal or state law, a low-speed vehicle, or a golf cart.
“Rider” means a passenger or other person riding in or on a regulated mobility device who is not operating the device.
“Shared mobility device” has the same meaning as in California Civil Code section 2505. “Vehicle” has the same meaning as in California Vehicle Code section 670.

City Council Agenda,

14.03.020 References to other laws.

Whenever this chapter refers to any statute, regulation, code, standard, or guideline, the reference shall include all amendments and successor provisions, unless a contrary intent is expressly stated.

14.03.030 General operation of regulated mobility devices.

A. Prohibited Areas Where Posted. No person shall operate, ride, park, leave, or place any regulated mobility device in any public area, public facility, pedestrian facility, bicycle facility, park, trail, pathway, sidewalk, or authorized private enforcement area where such operation, riding, parking, leaving, or placement is prohibited by posted signs, markings, barriers, or other official notice.

B. City Manager Authority to Designate Public Restrictions. The City Manager, or designee, may designate public areas, public facilities, parks, trails, pathways, sidewalks, parking lots, and other City-controlled locations where regulated mobility devices are prohibited or subject to additional restrictions based on public safety, pedestrian conflicts, facility design, congestion, special events, construction, maintenance, emergency conditions, or other operational concerns. A list of such locations shall be maintained by the City Clerk and may be amended from time to time by the City Manager.

C. Sidewalks and Pedestrian Facilities. No person shall operate or ride a regulated mobility device upon any sidewalk or pedestrian facility, except as may be necessary to enter or leave adjacent property or as otherwise expressly authorized by posted signage.

D. Public Facilities, Parks, and Recreational Areas. No person shall operate or ride a regulated mobility device in or upon any City park, playground, athletic field, sports court, gymnasium, public building, public plaza, public drainage facility, culvert, ditch, channel, landscaped area, or other public facility, except in areas expressly designated for such use by the City.

E. Trails and Pathways. No person shall operate or ride a regulated mobility device on any trail, pathway, open-space area, equestrian trail, hiking trail, recreational trail, or similar facility where such operation is prohibited by posted signage or by designation of the City Manager. Where operation is allowed, the operator shall yield to pedestrians and equestrians, operate at a reasonable and prudent speed, and dismount when conditions require safe shared use.

F. Due Care and Unsafe Operation. No person shall operate or ride a regulated mobility device in a manner that is unsafe, reckless, careless, or that endangers or is likely to endanger persons or property. Without limiting the foregoing, no person operating or riding a regulated mobility device shall:

1. Operate at a speed greater than is reasonable or prudent for existing conditions, including weather, visibility, traffic, pedestrian activity, roadway or pathway width, surface City Council Agenda,

condition, congestion, or proximity to driveways, intersections, parks, schools, gates, security facilities, commercial areas, or public facilities.

2. Operate in a manner that fails to yield to pedestrians, vehicles, equestrians, bicycles, golf carts, low-speed vehicles, or other regulated mobility devices when required by law or when reasonably necessary for safety.

3. Fail to obey posted traffic signs, signals, pavement markings, regulatory signs, or official traffic-control devices.

4. Ride against the lawful direction of traffic on any public street, private road, roadway, bicycle lane, or bicycle facility.

5. Perform acrobatics, tricks, stunts, wheelies, jumps, skids, burnouts, or similar maneuvers in any public area, public facility, private road, private parking facility, private common area, private commercial area, authorized private enforcement area, or in any location where pedestrians, vehicles, golf carts, or other regulated mobility devices are present.

6. Engage in racing, speed contests, exhibition of speed, stunt contests, group riding that obstructs traffic, or any coordinated riding activity that creates a foreseeable collision risk or interferes with the safe movement of pedestrians, vehicles, golf carts, or other devices.

7. Pass any pedestrian, vehicle, bicycle, equestrian, golf cart, or regulated mobility device at an unsafe speed, without reasonable and prudent lateral clearance, or in a manner that endangers or interferes with the safe movement of the person or device being overtaken.

8. Carry any package, bundle, item, animal, object, or passenger in a manner that prevents the operator from maintaining full control, safe balance, braking ability, or forward visibility.

9. Transport any other person on any portion of a regulated mobility device not designed for passenger riding, including handlebars, frame bars, floorboards, cargo areas, baskets, pegs, or any other area not designed and equipped for passengers.

10. Transport any passenger on a regulated mobility device designed for a single rider.

11. Cling to, attach to, tow, be towed by, or otherwise connect a regulated mobility device or any operator or rider to any moving vehicle, bicycle, regulated mobility device, golf cart, low-speed vehicle, or other wheeled device, except through equipment specifically designed and lawfully used for that purpose.

12. Operate with headphones, earbuds, handheld devices, or other distractions in a manner that prevents the operator from safely hearing, seeing, or responding to surrounding conditions.

13. Operate a regulated mobility device while under the influence of alcohol, cannabis, controlled substances, or any drug to the extent prohibited by state law.

City Council Agenda,

14. Operate in a manner that intentionally or recklessly frightens, startles, harasses, or threatens pedestrians, motorists, equestrians, bicyclists, golf cart operators, or other members of the public.

G. Helmets. Any person under 18 years of age operating or riding a regulated mobility device shall wear a properly fitted and fastened helmet when required by state law. No person shall operate a Class 3 electric bicycle without a properly fitted and fastened helmet where required by state law.

H. Equipment Compliance. No person shall operate a regulated mobility device unless the device is equipped and maintained as required by the California Vehicle Code and all other applicable laws, including requirements relating to brakes, reflectors, lights, labels, pedals, speed capability, power output, and other safety equipment.

14.03.040 Electric motorcycles and noncompliant electric vehicles.

A. No person shall operate an electric motorcycle, off-highway electric motorcycle, motordriven cycle, or noncompliant electric vehicle on any public street, highway, sidewalk, pedestrian facility, bicycle facility, park, trail, pathway, public facility, public area, private road, private parking facility, private common area, private commercial area, or authorized private enforcement area within the City unless such operation is expressly authorized by the California Vehicle Code and the vehicle is lawfully registered, licensed, equipped, identified, and operated for that location.

B. No person shall operate, ride, park, store, or place an electric motorcycle, off-highway electric motorcycle, or noncompliant electric vehicle in any City park, playground, athletic field, sports court, public building, public plaza, public drainage facility, culvert, ditch, channel, landscaped area, trail, pathway, or other public facility, except where expressly authorized by the City.

C. No person shall modify, alter, tamper with, or operate any electric bicycle in a manner that causes the device to exceed the speed, power, pedal, or equipment limits applicable to electric bicycles under the California Vehicle Code.

D. No person shall represent, operate, or treat any electric motorcycle, off-highway electric motorcycle, motor-driven cycle, or other noncompliant electric vehicle as an electric bicycle if the device does not meet the California Vehicle Code definition of an electric bicycle.

E. Nothing in this section shall be construed to authorize operation of any vehicle or device in a location where such operation is prohibited by state law, federal law, this Code, posted signage, private rules applicable to an authorized private enforcement area, or lawful direction of a peace officer, code enforcement officer, or City official.

14.03.050 Applicability to Private Property.

City Council Agenda,

A. General Rule. This chapter applies to all public property and public rights-of-way within the City to the fullest extent permitted by law. This chapter also applies to private property within the City only to the extent permitted by law, including where the private property is an authorized private enforcement area.

B. This chapter may be enforced on private roads, private common areas, private recreational areas, parking facilities, parks, beaches, trails, pathways, gates, security areas, and other property owned, maintained, operated, or regulated by a common interest development, property owners association, homeowners association, or similar entity (a “Private Entity”) only after all of the following have occurred:

1. The Private Entity has adopted rules, regulations, resolutions, or other governing documents that prohibit or regulate the same conduct prohibited or regulated by this chapter, or has otherwise incorporated this chapter by reference into the Private Entity’s rules;

2. The Private Entity has filed with the City a written request, consent, petition, or agreement requesting or authorizing City enforcement, in a form approved by the City Attorney;

3. The Private Entity has installed and maintained all signs, markings, notices, traffic-control devices, and entrance notices required by this chapter, the City Manager, and any enforcement agreement; and

4. The City Manager or designee has determined that the area is appropriate for enforcement and has placed the area on a list of authorized private enforcement areas maintained by the City Clerk.

C. Private Rules Preserved. Nothing in this chapter limits the ability of a Private Entity, a commercial property owner, or any other private owner or operator to adopt and enforce private rules, regulations, covenants, conditions, restrictions, contractual remedies, access restrictions, trespass remedies, disciplinary rules, member rules, towing policies, or other lawful privateproperty remedies independent of City enforcement.

D. No Mandatory Enforcement Duty. The City’s acceptance of a private-property enforcement request, petition, consent, or agreement does not require the City, Police Department, code enforcement personnel, or any other public agency to provide patrol, dedicated enforcement, security services, or a particular level of enforcement on private property.

E. Conditions and Costs. The City Manager may impose reasonable conditions on any private-property enforcement approval.

14.03.060 Removal, seizure, storage, and release.

A. State-Law Removal Authority. A peace officer may remove, seize, store, or impound any regulated mobility device, electric bicycle, Class 3 electric bicycle, electric motorcycle, offhighway electric motorcycle, or noncompliant electric vehicle when authorized by the California City Council Agenda,

Vehicle Code, including but not limited to California Vehicle Code section 22651.08, or any successor statute.

B. Public Safety Seizure. In addition to any fines or penalties authorized by this chapter, and to the extent permitted by state law, a peace officer may seize a regulated mobility device, electric bicycle, Class 3 electric bicycle, electric motorcycle, off-highway electric motorcycle, or noncompliant electric vehicle when the officer has probable cause to believe that the owner or operator has committed a violation of this chapter and that the violation created an immediate or substantial risk to public safety. Such violations may include, but are not limited to:

1. Reckless operation or exhibition of speed creating an immediate hazard to persons or property;

2. Willful disregard of traffic-control devices in active traffic, including stop signs, traffic signals, or yield controls;

3. Unsafe group riding that obstructs traffic or creates a foreseeable collision risk;

4. Operation in posted areas prohibiting electric bicycle operation when pedestrians are present; or

5. Operation in a park, playground, sports court, sidewalk, public facility, private road, private parking facility, private common area, private commercial area, or authorized private enforcement area in a manner creating a foreseeable risk of injury or collision.

Seizure under this subsection shall not be authorized for minor technical equipment violations, lawful conduct that does not present an objectively articulable safety risk, or mere presence in a group absent unsafe conduct.

C. Notice. Written notice of seizure and instructions for release shall be provided to the operator, if known, and to the owner, parent, or legal guardian when the operator is an unemancipated minor and such information is reasonably available.

D. Release Conditions. When the regulated mobility device, electric bicycle, Class 3 electric bicycle, electric motorcycle, off-highway electric motorcycle, or noncompliant electric vehicle seized under subsection B, it may be held for a minimum of 48 hours and released when all of the following conditions are satisfied:

1. The operator has completed a City-approved or Police Department-approved electric bicycle or regulated mobility device safety course;

2. If the operator is a minor, the minor’s parent or legal guardian is present at the time of release, unless waived by the Police Chief or designee for good cause;

3. The person seeking release provides satisfactory proof of ownership or lawful possession; and
City Council Agenda,

4. All lawful administrative charges, towing charges, storage charges, or other cost-recovery amounts have been paid, unless waived by the City Manager or designee.

E. Release of Vehicles Removed Under State Law. Any vehicle or device removed pursuant to the California Vehicle Code shall be released in accordance with applicable state law, including any lawful safety-course, proof-of-ownership, licensing, registration, identification, towing, storage, or administrative requirements.

14.03.070 Administrative charges and cost recovery.

A. The City may impose administrative charges not exceeding the City’s actual and reasonable administrative costs directly related to removal, seizure, towing coordination, storage coordination, documentation, processing, inspection, release, recordkeeping, and enforcement under this chapter, to the extent permitted by law.

B. Administrative charges may be imposed on the owner, operator, violator, parent, legal guardian, private property owner, association, or other legally responsible person to the extent permitted by state law, this Code, or any applicable enforcement agreement.

C. Nothing in this section shall limit the City’s authority to recover costs, impose penalties, or pursue any remedy otherwise available under this Code or state law.

14.03.080 Violations and enforcement.

A. Any violation of this chapter may be enforced by any remedy available under this Code or state law, including administrative citation, infraction citation, misdemeanor prosecution where authorized, public nuisance abatement, removal, seizure, impoundment, cost recovery, or any other civil, administrative, or criminal remedy.

B. Unless otherwise specified, any violation of this chapter may be punishable as an infraction or administrative citation. The City Attorney may prosecute any violation as a misdemeanor where the circumstances warrant such treatment, including repeated violations, reckless conduct, injury, property damage, flight from enforcement, false information, or unsafe operation.

C. In lieu of a fine, administrative citation, or other enforcement remedy, the City Attorney may may allow a violator to complete a safety course approved by the Police Chief or designee.

Eligibility for diversion may be denied based on the seriousness of the violation, prior violations, injury, property damage, failure to cooperate, or other public safety considerations.

D. Each act, each day, and each device involved in a violation may constitute a separate violation.

E. The remedies provided in this chapter are cumulative and not exclusive.

City Council Agenda,

14.03.090 Responsibility of parent or guardian.

A. The parent of any minor child, and the guardian of any ward, shall not authorize, knowingly permit, or fail to take reasonable steps to prevent the minor child or ward from violating this chapter.

B. A parent or legal guardian may be held jointly and severally responsible with an unemancipated minor for administrative fines, penalties, charges, or cost recovery imposed as a result of the minor’s violation, to the extent permitted by state law.

C. Evidence that a parent or guardian supplied, purchased, leased, provided access to, maintained, modified, or knowingly allowed a minor to use a regulated mobility device, electric motorcycle, or noncompliant electric vehicle in violation of this chapter may be considered in determining whether the parent or guardian authorized or knowingly permitted the violation.

14.03.100 Exemptions.

A. Public Agency Personnel. City personnel, law enforcement personnel, fire personnel, emergency medical personnel, and other public agency personnel may operate regulated mobility devices or other vehicles in any location within the City when reasonably necessary in the performance of official duties.

B. Private Security Personnel. Private security personnel, parking enforcement personnel, property management personnel, and other authorized private-property personnel may operate regulated mobility devices or other vehicles on private property when reasonably necessary in the performance of assigned duties and when authorized by the property owner or operator.

C. Disability and Mobility Devices. This chapter shall not prohibit or restrict the safe use of mobility devices by persons with disabilities in a manner protected by the Americans with Disabilities Act, the California Fair Employment and Housing Act, the Unruh Civil Rights Act, or any other applicable federal or state law.

D. Emergency Conditions. This chapter shall not prohibit operation of a regulated mobility device or vehicle when reasonably necessary to respond to an emergency, avoid imminent harm, or comply with the lawful direction of a peace officer, firefighter, emergency responder, security officer, gate attendant, or City official.

Section 4. No Conflict with State Law. This ordinance is intended to supplement and not conflict with the California Vehicle Code or any other applicable state or federal law. If any provision of this ordinance is interpreted to conflict with state or federal law, that provision shall be construed, limited, or applied in a manner that avoids such conflict to the maximum extent permitted by law.

Section 5. Clerical Errors. The City Council directs the City Clerk to correct any clerical errors found in this Ordinance, including, but not limited to, typographical errors, irregular numbering, and incorrect section references.

City Council Agenda,

City Council Agenda,

Section 6. Severability. Should any section, subsection, clause, or provision of this Ordinance for any reason be held to be invalid or unconstitutional, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this Ordinance; it being hereby expressly declared that this Ordinance, and each section, subsection, sentence, clause, and phrase hereof would have been prepared, proposed, approved, and ratified irrespective of the fact that any one or more sections, subsections, sentences, clauses, or phrases be declared invalid, unenforceable, or unconstitutional.

Section 7. Effective Date. This Ordinance shall take effect and be in force thirty (30) days from passage and adoption.

Section 8. Publication. The City Clerk shall cause the Ordinance or a summary thereof to be published in accordance with state law.

PASSED, APPROVED, AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the Mayor’s signature above and certify that the City Council duly adopted this Ordinance as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
APPROVED AS TO FORM:
_________________________
Steven Pacifico, City Attorney
City Council Agenda,

ITEM NO. 6

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Arron Brown, City Manager
DATE: 08/05/2026
SUBJECT: Second Reading and Adoption of Ordinance No. 282 - An Ordinance of the City Council of the City of Canyon Lake, California, Repealing and Replacing Chapter 9.32 (Accessory Dwelling Units) of the Canyon Lake Municipal Code to bring the City’s Accessory Dwelling Unit Ordinance into Compliance with Current State ADU Law Recommendation:
(1) Conduct second reading and adopt Ordinance No. 282 - An Ordinance of the City Council of the City of Canyon Lake, California, Repealing and Replacing Chapter 9.32 (Accessory Dwelling Units) of the Canyon Lake Municipal Code to bring the City’s Accessory Dwelling Unit Ordinance into Compliance with Current State ADU Law; and (2) direct staff to submit the adopted ordinance to the California Department of Housing and Community Development (HCD) for review in response to the May 11, 2026, Technical Assistance Letter.

Background/Analysis:

On June 10, 2026, the City Council introduced Ordinance No. 282 and approved its first reading. The proposed ordinance amends Chapter 9.32 (Accessory Dwelling Units) of the Canyon Lake Municipal Code to bring the City's ADU regulations into compliance with current State law. The amendments were prompted by a May 11, 2026, Technical Assistance Letter from the California Department of Housing and Community Development (HCD), which advised that the City's ordinance may no longer comply with recent changes to State ADU Law and requested that the City either demonstrate compliance or adopt a revised ordinance.

California Government Code section 66316 provides that if a local ADU ordinance is inconsistent with State law, it is deemed null and void, and the local agency must instead apply State ADU Law until a compliant ordinance is adopted.

The proposed ordinance updates Chapter 9.32 to incorporate changes to State ADU and Junior ADU (JADU) law enacted in 2024 and 2025. Major amendments include:

Updating definitions and terminology to reflect current Government Code provisions.

Revising application processing requirements, including completeness determinations and appeal procedures.

Updating owner-occupancy, rental, parking, and fire sprinkler requirements for ADUs and JADUs.

Revising impact fee provisions and development standards as required by State law.

Clarifying the number of ADUs permitted on single-family and multifamily properties.

Incorporating new provisions related to certificates of occupancy, emergency rebuilding, and other statutory requirements.

The ordinance also updates all Government Code citations to reflect the 2024 renumbering of the City Council Agenda,

State ADU statutes.

Certain items identified in HCD's Technical Assistance Letter were not incorporated because they are self-executing provisions of State law or apply to private parties rather than local agencies. Staff will separately provide notice to the Canyon Lake Property Owners Association regarding Civil Code section 714.3(b), which limits CC&R restrictions on ADUs.

The proposed ordinance is exempt from the California Environmental Quality Act (CEQA) pursuant to Government Code section 65852.2, which exempts accessory dwelling unit ordinances adopted in compliance with State law.

Fiscal Impact Yes/No:No
Additional Fiscal Information:

Adoption of the amended ADU Ordinance is not anticipated to have a fiscal impact on the City.

Implementation will be accommodated through existing departmental budgets.

Attachments:
1 - Ordinance
City Council Agenda,

ORDINANCE NO. 282

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE,

CALIFORNIA, AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, REPEALING AND REPLACING CHAPTER 9.32 (ACCESSORY

DWELLING UNITS) OF THE CANYON LAKE MUNICIPAL CODE TO BRING THE

CITY'S ACCESSORY DWELLING UNIT ORDINANCE INTO COMPLIANCE WITH

CURRENT STATE ADU LAW
WHEREAS, the City of Canyon Lake, California (“City”) is a municipal corporation, duly organized under the constitution and law of the State of California; and WHEREAS, the City of Canyon Lake ("City") has previously adopted regulations governing Accessory Dwelling Units ("ADUs") and Junior Accessory Dwelling Units ("JADUs"), codified at Chapter 9.32 of the Canyon Lake Municipal Code ("Municipal Code"), originally adopted by Ordinance No. 197 on March 4, 2020, and most recently amended by Ordinance No. 245 on April 10, 2024; and
WHEREAS, on May 11, 2026, the California Department of Housing and Community Development ("HCD") transmitted a Letter of Technical Assistance to City Manager Arron Brown advising that the ADU ordinance on file with HCD may be outdated and out of compliance with current State ADU Law; and
WHEREAS, California Government Code § 66316 provides that if an existing ADU ordinance fails to meet the requirements of State ADU Law, the ordinance is null and void and the local jurisdiction must apply State ADU Law standards until it adopts a compliant ordinance; and WHEREAS, the City Council finds that it is in the public interest to amend Chapter 9.32 of the Municipal Code to bring the City's ADU regulations into full compliance with State ADU Law, including amendments enacted in 2024 and 2025; and
WHEREAS, the proposed Ordinance amendment is not subject to environmental review under the California Environmental Quality Act (CEQA) pursuant to Government Code § 65852.2, which exempts ADU ordinances adopted in compliance with State ADU Law from CEQA review.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, DOES ORDAIN AS FOLLOWS:

Section 1. Recitals. The foregoing recitals are true and correct and are incorporated herein by this reference. The City Council expressly finds that the facts set forth in the recitals constitute the facts establishing the urgency for adoption of this Ordinance.

Section 2. Municipal Code Amendment. Section 9.32 of the City of Canyon Lake Municipal Code is hereby repealed and replaced as provided in Exhibit “A”, attached hereto and incorporated herein by reference.

City Council Agenda,

Section 3. CEQA. Under the California Public Resources Code section 21080.17, the California Environmental Quality Act (“CEQA”) does not apply to the adoption of an ordinance by a city or county implementing the provisions of section 65852.2 of the Government Code, which is California’s accessory dwelling unit law, and which also regulates junior accessory dwelling units, as defined by section 65852.22. Therefore, the proposed ordinance implements the State’s accessory dwelling unit law.

Section 4. Clerical Errors. The City Council directs the City Clerk to correct any clerical errors found in this Ordinance, including, but not limited to, typographical errors, irregular numbering, and incorrect section references.

Section 5. Severability. Should any section, subsection, clause, or provision of this Ordinance for any reason be held to be invalid or unconstitutional, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this Ordinance; it being hereby expressly declared that this Ordinance, and each section, subsection, sentence, clause, and phrase hereof would have been prepared, proposed, approved, and ratified irrespective of the fact that any one or more sections, subsections, sentences, clauses, or phrases be declared invalid, unenforceable, or unconstitutional.

Section 6. Submission to HCD. City staff is hereby directed to submit this Ordinance to the California Department of Housing and Community Development (HCD) for review in response to the May 11, 2026, Technical Assistance Letter, consistent with Government Code § 66326 Section 7. Effective Date. This Ordinance shall take effect and be in force thirty (30) days from passage and adoption.
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City Council Agenda,

Section 8. Publication. The City Clerk shall cause the Ordinance or a summary thereof to be published in accordance with state law.

PASSED, APPROVED, AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the Mayor’s signature above and certify that the City Council duly adopted this Ordinance as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
APPROVED AS TO FORM:
_________________________
Steven Pacifico, City Attorney
City Council Agenda,

Exhibit “A”
Municipal Code Chapter 9.32: Accessory Dwelling Units
CHAPTER 9.32: ACCESSORY DWELLING UNITS
Section

9.32.010 Definitions.

9.32.020 General provisions.

9.32.030 Permitted zones.

9.32.040 On-site parking.

9.32.050 On-site parking, exceptions.

9.32.060 Parking location.

9.32.070 Square footage.

9.32.080 Height.

9.32.090 Setback.

9.32.100 Design and development standards.

9.32.110 Multifamily zones.

9.32.120 Junior ADU standards.

9.32.130 Short-term rentals.

9.32.140 Conveyance.

9.32.150 By right units-building permit approval only.

9.32.010 Definitions.
(a) "Accessory dwelling unit (ADU)" has the same meaning ascribed in Government Code Section 6 66323, as the same may be amended from time to time. An ADU means an attached or a detached residential dwelling unit that provides complete independent living facilities for one or more persons and is located on a lot with a proposed or existing primary residence. It shall include permanent provisions for living, sleeping, eating, cooking, and sanitation on the same parcel as the single-family dwelling is situated. An accessory dwelling unit also includes the following: (1) an efficiency unit, as defined in Section 17.958.1 of Health and Safety Code; and (2) a manufactured home, as defined in Section 18007 of the Health and Safety Code. (b) "Junior accessory dwelling unit (Junior ADU or JADU)" means a residential dwelling unit that is no more than 500 square feet of interior livable space and contained entirely within an existing or proposed single-family structure . A junior accessory dwelling unit may include separate sanitation facilities or may share sanitation facilities with the existing structure.

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(c) "Efficiency unit," as defined in Section 17958.1 of the Health and Safety Code, may be permitted for occupancy by no more than two persons and shall not be less than 150 square feet in size. The efficiency unit shall have a bathroom facility and a partial kitchen, with a kitchen sink, cooking appliance, and refrigerator.
(d) Collectively, ADUs and junior ADUs may be referred to in this Chapter as accessory dwelling units.

9.32.020 General provisions.

Unless otherwise preempted by state law, the design and construction of all newly constructed accessory dwelling units shall comply with all applicable building, housing, zoning and site development standards of this Chapter, including but not limited to standards regarding setbacks, floor area ratio standards, height, and lot coverage. Applicants shall also comply with all applicable fee and charge requirements, and other applicable zoning requirements. Applications deemed complete for accessory dwelling units shall be approved ministerially with the applicable 60-day review period consistent with state law. The permitting agency shall determine whether an application for an ADU or JADU is complete and provide written notice of that determination not later than 15 business days after receipt of the application. If an application is determined to be incomplete, the written notice shall include a list of incomplete items and a description of how the application can be made complete. If a permit application is determined to be incomplete or is denied, the applicant shall have the right to appeal the determination, and the permitting agency shall provide a final written determination not later than 60 business days after receipt of the written appeal.

Consistent with Government Code Section 66315, as the same may be amended from time to time, the City shall not require owner-occupancy as a condition of issuing a permit for an accessory dwelling unit. This prohibition does not apply to junior accessory dwelling units, which are governed by the owner-occupancy requirements set forth in Section 9.32.120(b).

9.32.030 Permitted zones.

Accessory dwelling units shall be a permitted use within the City's single-family and multiplefamily residential zones.

9.32.040 On-site parking.
(a) Required parking for accessory dwelling units shall not exceed one parking space per accessory dwelling unit or per bedroom, whichever is less. (b) When an existing garage, carport, covered parking structure, or uncovered off-street parking space is demolished in conjunction with the construction of an accessory dwelling unit or is converted into an accessory dwelling unit, replacement parking for the primary dwelling unit shall not be required.
(c) When required, on-site parking can be covered, uncovered, tandem or provided through the use of a mechanical automobile parking lift. Tandem parking as defined in this division means that two or more automobiles are parked in a driveway or in any other location on a lot, lined up behind one another.

City Council Agenda,

9.32.050 On-site parking, exceptions.

Notwithstanding the parking development standards for accessory dwelling units, accessory dwelling units that meet the following state provisions (consistent with Government Code Section 66323, as amended by SB 477, Chapter 7, Statutes of 2024) shall not be required to provide onsite parking in any of the following instances if:
(a) The accessory dwelling unit is located within one-half mile walking distance of "public transit" within the meaning of Government Code Section 66323; (b) The accessory dwelling unit is located within an architecturally and historic significant historic district;
(c) The accessory dwelling unit is part of the existing primary dwelling unit or an existing accessory structure;
(d) When on-street parking permits are required but not offered to the occupant of the accessory dwelling unit; or
(e) When there is a car share vehicle located within one block of the accessory dwelling unit. (f) When a permit application for an accessory dwelling unit is submitted with a permit application to create a new single-family dwelling or a new multifamily dwelling on the same lot, provided that the accessory dwelling unit or the parcel satisfies any other criteria listed in this paragraph.

9.32.060 Parking location.

The parking provided on-site can be tandem and in an existing driveway or within any existing setback area, unless specific findings are made that parking in setback areas or tandem parking is not feasible based upon specific site, topographical or fire and life safety conditions. When a designated parking area is provided and is not located in the driveway as tandem, the parking space must meet the minimum required turning radius and backup distance according to the requirements of the California Building Code and California Residential Code.

9.32.070 Square footage.
(a) All new accessory dwelling units and additions to existing and permitted accessory dwelling units are exempt from compliance with the Floor Area Ratio (FAR), lot coverage, open space, or minimum lot size requirements noted in the Municipal Code unless otherwise specified herein.
(b) All new detached accessory dwelling units shall not exceed 1,200 square feet of interior livable space.
(c) When an accessory dwelling unit is attached to the existing primary dwelling unit, the maximum allowed size of that accessory dwelling unit shall be no more than fifty percent of the main dwelling size, or 850 or 1,000 square feet of interior livable space based on number of bedrooms as noted in preceding Subsection (b), whichever is less.

City Council Agenda,

(d) When a balcony, porch or patio is provided in conjunction with an accessory dwelling unit, if said structure is covered, it shall count towards the total accessory dwelling unit square footage allowance.
(e) Pursuant to Government Code Section 66321, subdivisions (b)(2)(A), (b)(3)the city shall impose objective standards on accessory units that include a landing or a balcony, porch or patio for the purposes of square footage requirements.
(f) If a cover such as a porch or similar type structure is provided over the main entrance of the accessory dwelling unit, and is supported by posts, 25 square feet of the said cover will not count towards the maximum allowable square footage of the accessory dwelling unit. (g) Accessory dwelling units may include an expansion of not more than 150 square feet beyond the same physical dimensions as the existing accessory structure. An expansion beyond the physical dimensions of the existing accessory structure shall be limited to accommodating ingress and egress.

9.32.080 Height.
(a) All new accessory dwelling units, attached to the main dwelling unit must comply with the height requirements, allowing up to 16 feet.
(b) When an accessory dwelling unit is constructed on top of a detached garage, accessory structure, or above another accessory dwelling unit when applicable under this Code, shall have a minimum allowable height of 18 feet.
(c) All new detached accessory dwelling units on a lot with an existing or proposed multifamily, multistory dwelling shall have a minimum allowable height of 18 feet. (d) When an accessory dwelling unit is constructed on top of a garage or accessory structure, the accessory dwelling unit cannot touch grade level, except through support posts. The bottom of the finished floor of the accessory dwelling unit must be above the top of plate of the garage or accessory structure.

9.32.090 Setback.
(a) Unless otherwise provided in this Chapter, any new accessory dwelling units must have a minimum setback of four feet to the rear property line and four feet to the side-yard property line with the exception that accessory dwelling units on top of a garage shall maintain a minimum five feet setback from side and rear property lines.
(b) Any new accessory dwelling unit cannot be located closer to the front property line than the prevailing front yard setback for a single family residential zoned lot or minimum required front setback for a multifamily residential zoned lot.
(c) No setback shall be required for an accessory dwelling unit that is within an existing structure or new accessory dwelling unit that is constructed in the same location and with the same dimensions as an existing structure.
(d) New accessory dwelling units must maintain a five-foot separation from building face to building face, and a four foot separation from eave to eave of any adjacent structure.

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(e) No accessory dwelling unit may be located in a way that would prohibit access to a designated parking area or impede safe ingress and egress from a required side, rear, or front setback.
(f) No setback shall be required when an accessory dwelling unit is constructed in the same location and to the same dimensions as an existing legal structure that is converted into an accessory dwelling unit or to a portion of an accessory dwelling unit, even when that structure has been demolished.
(g) When a balcony, porch or patio is provided in conjunction with the accessory dwelling unit and is seven inches above grade level, the balcony, porch or patio must be setback from the rear and side property lines a minimum of four feet.
(h) When a staircase or landing is provided for a new or existing second story accessory dwelling unit, whether attached or detached to the primary dwelling unit, that staircase or landing must provide a minimum four foot setback to the rear and side property line.

9.32.100 Design and development standards.
(a) The exterior design of the accessory dwelling unit shall match that of the main dwelling in terms of building forms, materials, colors, exterior finishes, roof forms and style of doors and windows. The structure(s) shall retain the appearance of a single-family dwelling, and the accessory dwelling unit shall be integrated into the design of the existing primary dwelling unit on the property or as determined objectively and approved ministerially. (b) The accessory dwelling unit shall have the same design, architecture, colors and materials of the primary dwelling, and shall comply with any objective design standards adopted by the city, regardless of whether the use of the accessory dwelling unit is continued or terminated. If a separate entrance is provided, it shall be located on the side or rear of the structure and whenever possible located toward interior yard areas. The additional entrance is prohibited from being located on the front of the primary dwelling unit. The second entrance shall be well lit and free of concealment from landscaping to assure safe entrance and exit by the occupants. (c) Consistent with Government Code Section 66323 (a)(1)(B)(i) all visible facade elevations of accessory dwelling units from any public right of way shall comply with the objective design standards adopted by the city.
(d) When a garage is converted into an accessory dwelling unit, the garage door must be removed and replaced with windows, door, or other design treatments that are compatible with the structure and the primary dwelling unit that can be uniformly verifiable by reference to an external and uniform benchmark
(e) The accessory dwelling unit shall comply with the requirements under the Code pertaining to the adequacy of water, sewer, electrical, drainage, and fire and emergency services to the property on which the accessory dwelling unit will be located as well as all applicable codes pertaining to building, fire, health, and/or safety.
(f) The main entrance of a detached accessory dwelling unit (ADU) shall align with the main entrance of the primary dwelling unit or face the side property lines, based on objective standards that prioritize compatibility with the neighborhood character. If an ADU entrance is proposed to City Council Agenda,

face an alley or rear property line, it shall be subject to review based on an objective standard and ministerial process.

9.32.110 Multifamily zones.

All of the provisions of this section shall apply to accessory dwelling units in the Multifamily Zones, unless otherwise stated in the following:
(a) No more than eight detached accessory dwelling units may be constructed on a lot with an existing multifamily dwelling, provided that the number of detached ADUs does not exceed the number of existing dwelling units on the lot. These accessory dwelling units must be detached from the primary structure and may be attached or detached from each other. (b) Accessory dwelling units may be created within a multifamily dwelling structure in areas not used as livable space, such as storage rooms, boiler rooms, passageways, attics, basements, common areas or garages, so long as the converted space complies with state building standards for dwellings.
(c) A minimum of one accessory dwelling unit or up to twenty-five percent of the existing multifamily unit total on the subject property, is permitted within an existing multifamily dwelling unit.

9.32.120 Junior ADU standards.

All of the provisions of this section shall apply to a junior ADU unless otherwise stated in the following:
(a) A junior ADU is limited to 500 square feet.
(b) A junior ADU requires owner-occupancy as follows: If the junior ADU shares sanitation facilities with the primary dwelling, the owner shall reside in either the remaining portion of the single-family residence or the newly created junior ADU. If the junior ADU has separate sanitation facilities, owner-occupancy shall not be required. This provision does not apply if the owner is a governmental entity, land trust or housing organization. (c) A deed restriction must be recorded and will run with the land prohibiting the sale of the junior ADU separate from the sale of the single-family residence, including a statement that the deed restriction may be enforced against future purchasers. (d) The deed restriction must include the size and attributes of the junior ADU that conforms to this Section.
(e) The junior ADU shall be constructed within the walls of the proposed or existing singlefamily residence, as well as any enclosed uses within the residence. This area also includes enclosed, non-habitable rooms and uses, including but not limited to attached garages and storage rooms.
(f) The junior ADU must include a separate entrance from the main entrance to the singlefamily residence and an interior entry to the main living area. A second interior doorway may be provided for sound attenuation. If a junior ADU shares a bathroom with the primary dwelling, the City Council Agenda,

junior ADU is required to have an interior entry to the primary dwelling's "main living area," independent of the exterior entrances of the junior ADU and primary dwelling. (g) The junior ADU must include an efficiency kitchen, which shall include all the following:
(1) A cooking facility with appliances.
(2) A food preparation counter and storage cabinets that are of reasonable size in relation to the size of the Junior ADU.
(h) Additional parking may not be required as a condition to grant a permit for a junior ADU. (i) An inspection, including the imposition of a fee for that inspection to determine whether the junior ADU is in compliance with applicable building standards may be required at any time after the junior ADU has been built.
(j) For the purposes of any fire or life protection ordinance or regulation, a junior ADU shall not be considered a separate or new dwelling unit. This Section shall not preclude the City from adopting an ordinance or regulation relating to fire and life protection requirements within a singlefamily residence that contains a junior ADU so long as the ordinance or regulation applies uniformly to all single-family residences within the zone regardless of whether the single-family residence includes a junior ADU or not.
(k) For the purposes of providing service for water, sewer, or power, including a connection fee, a junior ADU shall not be considered a separate or new dwelling unit. (l) A recorded deed restriction is required, that shall run with the land, and shall be filed with the permitting agency, and shall include both of the following:
(1) A prohibition on the sale of the junior accessory dwelling unit separate from the sale of the single-family residence, including a statement that the deed restriction may be enforced against future purchasers.
(2) A restriction on the size and attributes of the junior accessory dwelling unit that conforms to this section.
(m) Fire sprinklers shall not be required for a junior accessory dwelling unit if fire sprinklers are not required for the primary dwelling unit. The addition of a junior accessory dwelling unit shall not trigger a requirement to install fire sprinklers in the primary dwelling unit. This subdivision shall apply notwithstanding any other provision of law, consistent with Government Code Section 66323, subdivision (d), as the same may be amended from time to time

9.32.130 Short-term rentals.

Unless otherwise provided for in the Canyon Lake Municipal Code, accessory dwelling units and junior accessory dwelling units (JADUs), which are rented, shall be rented for terms longer than 30 days.

9.32.135 Impact Fees – Prohibition for Small ADUs and JADU City Council Agenda,

(a) No impact fee shall be imposed upon the development of an accessory dwelling unit that has 750 square feet of interior livable space or less.
(b) No impact fee shall be imposed upon the development of a junior accessory dwelling unit that has 500 square feet of interior livable space or less. (c) Any impact fee imposed upon an accessory dwelling unit that has more than 750 square feet of interior livable space shall be charged proportionately in relation to the square footage of the primary dwelling unit, consistent with Government Code Section 66311.5, subdivisions (a) through (d), as the same may be amended from time to time. (d) An accessory dwelling unit or junior accessory dwelling unit that contains less than 500 square feet of interior livable space shall not be deemed to increase the assessable space of the parcel for purposes of property tax assessment, consistent with applicable state law.

9.32.140 Conveyance.

Any accessory dwelling unit may be rented separate from the primary residence and may be sold or otherwise conveyed separate from the primary residence to a qualified buyer.

9.32.150 By rights units - building permit approval only. (a) An applicant shall not be required to submit an application for an ADU or JADU permit under this chapter and may instead seek building permit approval for an ADU or JADU that satisfies the requirements of Government Code Section 66323(e)(l), as the same may be amended from time to time, and the California Building Standards Code, as amended by the city. (b) Pursuant to Government Code Section 66323(e), the city shall ministerially approve an application for a building permit within a residential or mixed-use zone to create any of the following:
(1) One ADU or JADU per lot with a proposed or existing single-family dwelling if all of the following apply:
(A) The ADU or JADU is within the proposed space of a single-family dwelling or existing space of a single-family dwelling or accessory structure and may include an expansion of not more than 150 square feet beyond the same physical dimensions as the existing accessory structure. An expansion beyond the physical dimensions of the existing accessory structure shall be limited to accommodating ingress and egress. (B) The space has exterior access from the proposed or existing singlefamily dwelling.
(C) The side and rear setbacks are sufficient for fire and safety. (D) The JADU complies with the requirements of Section 66333 and with the requirements set forth in Section 9.32.120 above.
(2) One detached, new construction ADU that does not exceed four-foot side and rear yard setbacks for a lot with a proposed or existing single-family dwelling. The ADU may be City Council Agenda,

combined with a JADU described in subsection (b)(l) above. The ADU shall be no more than 800 square feet in size, with a height limit of 16 feet.
(3) One ADU 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. If requested, multiple ADUs shall be allowed, up to the number of ADUs that equals 25 percent of the existing multifamily dwelling units in the structure. (4) Not more than eight detached ADUs located on a lot that has an existing multifamily dwelling, provided that the number of detached ADUs does not exceed the number of existing dwelling units on the lot, subject to a height limit of 16 feet and four-foot rear yard and side setbacks.

9.32.155 Certificate of Occupancy During State of Emergency (a) Notwithstanding any other provision of this Chapter, the City shall issue a certificate of occupancy for an accessory dwelling unit constructed on a parcel located in a county subject to a proclamation of a state of emergency issued by the Governor on or after February 1, 2025, even if the primary dwelling unit on the same parcel has not yet been issued a certificate of occupancy, provided that all of the following conditions are satisfied:
(1) The primary dwelling unit was substantially damaged or destroyed by an event referenced in the state of emergency proclamation;
(2) The accessory dwelling unit satisfies all applicable building standards under the California Building Standards Code and this Chapter; and (3) The occupancy of the accessory dwelling unit is intended to house the displaced residents of the primary dwelling unit.
(b) This section is consistent with Government Code Section 66328, as the same may be amended from time to time.

9.32.160 Unpermitted Accessory Dwelling Units Constructed Before January 1, 2020.

The City shall not deny a permit for an accessory dwelling unit or junior accessory dwelling unit that was constructed before January 1, 2020, solely on the basis of building code violations, unless the City makes a written finding that correcting the building code violation is necessary to comply with conditions that would otherwise render the structure substandard pursuant to applicable law.

This section is consistent with Government Code Section 66332, subdivisions (a) through (c), as the same may be amended from time to time.

City Council Agenda,

ITEM NO. 7

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Sheryl Garcia, Assistant City Manager/City Clerk
DATE: 08/05/2026
SUBJECT: Approve the Appointment of the City's Alternate to the Lake Elsinore San Jacinto Watersheds Authority
Recommendation:

Approve the appointment of Council Member Welty as the City's alternate to the Lake Elsinore San Jacinto Watersheds Authority.

Background/Analysis:

On December 11, 2025, the City Council approved appointments to various regional boards, commissions, and committees for the 2026 calendar year. The proposed action updates the City's appointment to the Lake Elsinore San Jacinto Watersheds Authority (LESJWA) by designating Council Member Welty as the City's Alternate in place of Council Member Castillo.

Upon approval, the City Clerk will notify LESJWA of the revised appointment and update any required records.

Fiscal Impact Yes/No:No
City Council Agenda,

ITEM NO. 8

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Terry Shea, Finance Director
DATE: 08/05/2026
SUBJECT: Receive and File the Quarterly Investment Report for the Quarter Ended June 30, 2026 Recommendation:

Receive and file the Quarterly Investment Report for the quarter ending June 30, 2026, in compliance with the City’s Investment Policy.

Background/Analysis:

The attached Quarterly Investment Report presents the City’s cash and investments for the quarter that ended June 30, 2026. This report is in compliance with the California Government Code Section 53646 regarding the reporting of detailed information on all securities, investments, and monies of the City, as well as the reporting of the market value of the investments held. All the investments contained within the portfolio are in full compliance with the City’s Investment Policy and Government Code Section 53601 as to the types of investments allowed. It is recommended that the City Council receive and file the attached Quarterly Investment Report.

The City maintains a portfolio of investments to earn interest in cash balances that are not currently required to fund operations. California Government Code Sections 53601 and 53646 establish the types of investments allowed, the governing restrictions on these investments, the third-party custodian arrangement for certain investments, and the reporting practices related to the portfolios of local agencies. In keeping with best practices, the City has implemented an Investment Policy, which was last reviewed by the City Council on June 10, 2026. The policy is in full compliance with the requirements of both above-mentioned Code Sections.

The attached Quarterly Investment Report presents the City’s cash and investments for the quarter that ended June 30, 2026. The report complies with California Government Code Section 53646 regarding the reporting of detailed information on all securities, investments, and monies of the City, as well as the reporting of the market value of the investments held. All the investments contained within the portfolio are in full compliance with the City’s Investment Policy and Government Code Section 53601 as to the types of investments allowed. As stated in the attached report, there is more than adequate liquidity within the portfolio for the City to meet its budgeted expenditures over the next six months.

The City’s investment policy has set the primary goals of the portfolio management as Safety and Liquidity, followed by Yield. The City’s cash flow requirements are evaluated on an ongoing basis, with short-term needs accommodated through the City’s pooled investment funds with Local Agency Investment Fund (LAIF) and Citizens Trust Allspring Funds Trust Government Money Market Funds.

LAIF is a pool of public funds managed by the State Treasurer of California, providing 24-hour liquidity while yielding a rate of return approximately equivalent to a one-year treasury bill. With the combined City Council Agenda,

use of a conservative approach to evaluating cash flow needs and LAIF and the Allspring Funds Trust Government Money Market liquidity, the City will not have to liquidate securities at current market rates that are intended to be held for longer-term investment.

The table below shows the average yield to maturity for the quarter ending June 30, 2026, compared to the quarter ending June 30, 2025.

Portfolio Balance at Cost June 30, 2026 June 30, 2025
$6,769,217 3.34% 3.26%
Fiscal Impact Yes/No:No
Attachments:
1 - Schedule of Investments
2 - Investment Policy
3 - Citizens Bank Statement
4 - Multi Bank Securities Statement
City Council Agenda,

Book Value (Fair Value)
Par Price @ Market Purchase Maturity
Institution Value Cost Value Yield Date Date

ACTIVE DEPOSITS
Money Market Accounts:

Citizens Business Bank - Money Market 313,952.54 $ 313,952.54 $ 313,952.54 $ 0.100% N/A N/A Total Money Market $ 313,952.54 313,952.54 $ 313,952.54 $ Pooled Investment Accounts:

Local Agency Investment Fund 11,896.86 $ 11,896.86 $ 11,896.86 $ 3.920% N/A N/A Total Pooled Investment $ 11,896.86 11,896.86 $ 11,896.86 $ Multi-Bank Securities
Cash Balance 3,780.89 $ 3,780.89 $ 3,780.89 $ 0.000% N/A N/A Kemba Financial Credit Union CD 249,000.00 249,000.00 248,683.77 3.700% 10/23/25 10/23/26 Wells Fargo Bank CD 210,000.00 210,000.00 209,701.80 3.650% 10/23/25 10/23/26 Transportation Alliance Bank CD 249,000.00 249,000.00 248,188.26 3.650% 10/23/25 04/23/27 Seven Seventeen Credit Union CD 247,000.00 247,000.00 246,464.01 3.800% 10/24/25 04/26/27 Vibrant Credit Union CD 249,000.00 249,000.00 248,469.63 3.800% 10/27/25 04/26/27 California Credit Union CD 245,000.00 245,000.00 244,387.50 3.800% 10/28/25 04/28/27 Dort Financial Credit Union CD 247,000.00 247,000.00 246,256.53 3.700% 10/28/25 04/28/27 Live Oak Bank CD 249,000.00 249,000.00 248,163.36 3.650% 10/28/25 04/28/27 First Freedom Bank CD 210,000.00 210,000.00 209,701.80 3.650% 10/23/25 10/23/26 Total MBS $ 2,158,780.89 2,158,780.89 $ 2,153,797.55 $
Citizens Trust:

Allspring Funds TR Government MMKT 3,913,406.77 $ $ 3,913,406.77 $ 3,913,406.77 3.550% N/A N/A Federal Home Loan Bank 150,000.00 150,000.00 149,349.00 1.050% 08/26/21 08/26/26 Federal Farm Credit Bank 100,000.00 99,925.00 99,540.00 0.900% 08/26/21 08/26/26 Total Citizens Trust $ 4,288,406.77 $ 4,284,586.35 $ 4,286,620.77 ACTIVE DEPOSITS TOTAL $ 6,769,216.64 6,773,037.06 $ 6,766,267.72 $ Effective Interest Rate 3.34% Unrealized Gains (Losses) $ (2,948.92)

INACTIVE DEPOSITS
Checking Account:

Citizens Business Bank - Checking 886,371.49 $ 886,371.49 $ 0.000% N/A N/A Citizens Business Bank - Rental 52,387.59 52,387.59 0.000% N/A N/A California Bank & Trust - Checking 8,059.82 8,059.82 0.000% N/A N/A Investment in Real Estate 2,222,501.37 2,222,501.37 0.000% N/A N/A Total $ 3,169,320.27 3,169,320.27 $ 0.000%
INACTIVE DEPOSITS TOTAL $ 3,169,320.27 3,169,320.27 $
GRAND TOTAL CASH $ 9,935,587.99 9,938,536.91 $
________________________________
Terry Shea
6/30/2026
City of Canyon Lake
Schedule of Investments
as of June 30, 2026
Per Government Code requirements, the Investment Report is in compliance with the City of Canyon Lake's Investment Policy, and there are adequate funds available to meet budgeted and actual expenditures for the next six months.

City Council Agenda,

1 RESOLUTION NO. 2026- 30

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE,

CALIFORNIA, ADOPTING THE CITY OF CANYON LAKE INVESTMENT POLICY AND

DELEGATING INVESTMENT AUTHORITY TO THE CITY TREASURER PURSUANT TO CALIFORNIA GOVERNMENT CODE SECTION 53607
WHEREAS, California Government Code Sections 53601 et seq. authorize local agencies to invest public funds and require the legislative body to annually review and approve an investment policy; and
WHEREAS, California Government Code Section 53607 authorizes the legislative body to delegate investment authority to the City Treasurer; and
WHEREAS, the City of Canyon Lake has established an Investment Policy to provide guidance for the prudent management and investment of public funds in accordance with State law; and WHEREAS, the primary objectives of the City’ s Investment Policy are the safety of principal, maintenance of liquidity necessary to meet the City’ s operational needs, diversification of investments, and attainment of a reasonable rate of return consistent with those objectives; and WHEREAS, the City’ s Investment Policy is reviewed annually to ensure compliance with applicable laws and current investment practices; and
WHEREAS, staff has reviewed the City’ s existing Investment Policy and recommended updates to reflect changes in California law and investment guidelines; and WHEREAS, the City Council has reviewed the updated Investment Policy and finds that adoption of the policy is in the best interests of the City and its residents.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE DOES RESOLVE AS FOLLOWS:

Section 1. The above recitals are true and correct and are incorporated herein by reference.

Section 2. The City Council hereby adopts the City of Canyon Lake Investment Policy, attached hereto as Exhibit “ A” and incorporated herein by this reference.

Section 3. Pursuant to California Government Code Section 53607, the City Council hereby delegates authority to invest and reinvest City funds, and to sell or exchange securities so purchased, to the City Treasurer in accordance with the provisions of the adopted Investment Policy and applicable provisions of California law.

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2 Section 4. The provisions of this Resolution are severable and if any provision, clause, sentence, word or part thereof is held illegal, invalid, unconstitutional, or inapplicable to any person or circumstances, such illegality, invalidity, unconstitutionality, or inapplicability shall not affect or impair any of the remaining provisions, clauses, sentences, sections, words or parts thereof of the Resolution or their applicability to other persons or circumstances.

Section 5. That the City Clerk shall certify to the adoption of this Resolution and that the same shall be in full force and effect.

Section 6. This Resolution shall take effect immediately upon its adoption.

PASSED, APPROVED AND ADOPTED this 10th day of June 2026, by the following vote:

AYES: Castillo, Steeber, Terry, Welty, Smith
NOES: None
ABSENT: None
ABSTAIN: None
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the mayor’ s signature above and certify that the City Council duly adopted this Resolution as recorded in the vote tally stated herein.

Sheryl L. Garcia, MMC, CPM
City Clerk
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3 EXHIBIT “ A”
Investment Policy
to be attached]
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4 INVESTMENT POLICY
The City of Canyon Lake has adopted the following policy for the investment of City funds.

I. The Legal Authority
The Authority governing investments for the City of Canyon Lake is set forth in the California Government Code, sections 53601 et. Seq. The City Treasurer is granted authority to make investments on behalf of the City.

Government Code Section 53607 states “..... the authority of the legislative body to invest or to reinvest funds of a local agency, or to sell or exchange securities so purchased, may be delegated by the legislative body to the treasurer of the local agency, who shall thereafter assume full responsibility for such transactions until such time as the delegation of authority is revoked, and shall make a monthly report of such transaction to the legislative body.”
Government Code Section 53649 states “... the treasurer is responsible for the safekeeping of money in his custody and shall enter into any contract with a depository relating to any inactive deposits which in his judgment is to the public advantage.” The City Treasurer will enter into purchases subject to this policy and at the direction of City Council.

In addition, Government Code Section 53607 provides the authority for the legislative body of the local agency to invest the funds of the local agency or to delegate the full responsibility to the treasurer of the local agency.

II. Investment Objectives
A. The purpose of this policy is to provide guidelines for the investment of the City’ s funds based upon State law and prudent money management. This policy is designed according to the specific needs of the City of Canyon Lake. The ultimate goal is to enhance the economic status of the City while ensuring the safety of funds.

B. The City holds to the “ prudent investor rule” in that investments shall be made with a degree of judgment and care, not for speculation, but considering the safety of the monies and acting as a custodian of the public trust. Related activities, which comprise good cash management, include cash projections, the expeditious collection of revenue, disbursement control and a cost- effective banking relationship.

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5 C. The investment of the funds of the City of Canyon Lake shall be guided by the goals of safety, liquidity, diversification and return on investments in that order of priority.

Safety: Safety of principal is the foremost objective of the City of Canyon Lake. Each investment transaction shall seek to ensure that capital losses are avoided, whether from securities default, brokerdealer default, or erosion of market value. The City shall seek to preserve principal by mitigating the two types of risk: credit risk and market risk.

Credit Risk - Credit Risk; defined as the risk of loss due to failure of the issuer of a security, shall be mitigated by investing only with issuers whose financial strength and reputation can be verified to be the highest as rated by nationally known rating agencies and by diversifying the investment portfolio so that the failure of any one issuer would not unduly harm the City’ s cash flow.

Market Risk - Market risk, the risk of the market value fluctuations due to overall changes in the general level of interest rates, shall be mitigated by ( a) structuring the portfolio so that securities mature earlier than or concurrent with the timing of major cash outflows, thus eliminating the need to sell securities prior to their maturity; ( b) prohibiting the use of leverage or margin accounts; ( c) prohibiting the taking of short positions, that is, selling securities which the City does not own; ( d) prohibiting the use of reverse repurchase agreements and repurchase agreements; and ( e) prohibiting the use of “ inverse floaters”. It is explicitly recognized herein, however, that in a diversified portfolio, occasional measured losses are inevitable and must be considered within the context of the overall investment return.

Liquidity: The City’ s financial portfolio must be structured in a manner which will provide that securities mature at approximately the same time as cash is needed to meet anticipated demands.

Return on Investments: The investment portfolio shall be designed with the overall objective of obtaining a total rate of return throughout economic cycles, commensurate with investment risk constraints and cash flow needs.

III. Deposits/ Authorized Investments
A. Deposits
Money must be deposited in State or national banks, State or Federal savings associations, or State or Federal Credit unions within the State. It may be in inactive deposits, active deposits or interestbearing active deposits. The FDIC must insure the first $250,000 of a deposit.

The bank or savings and loan must secure active and inactive deposits with eligible securities having a market value of 110% of the total amount of the deposits. State law also allows as an eligible security, first trust deeds having a value of 150% of the total amount of deposits. A third class of collateral is letter of credit drawn on the Federal Home Loan Bank (FHLB).

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6 B. Authorized Investments
General Guidelines that the City should follow in managing its investments are as follows:

No investment will be purchased which matures more than five years from the date of purchase without the prior approval of the City Council.

Maturities of individual investments shall be diversified, attempting to match, where possible, cyclical cash flow requirements.

The use of callable securities is permitted.

To reduce overall portfolio risk while attempting to attain market value rates of return consistent with the primary objectives of safety and availability of funds, investments shall be diversified cross types of investments, maturities of those investments, and institutions in which those investments are made.

Generally, the portfolio is to be invested in Federal Agency securities, with a modest addition of highgrade Medium- Term Corporate Notes, Certificates of Deposit ( CD’ s), U.S. Treasuries and Commercial Paper.

The City specifically prohibits investments in Bonds issued by other local agencies, Reverse Repurchase Agreements and Derivatives ( Interest rate floaters, range notes, interest- only strips) Permitted Investments Per City Policy:

Investments shall be made only in those instruments specifically authorized by California State laws section 53600- 53609), and to no greater an extent than those authorized by those laws.

The City’ s specific permitted investment guidelines are listed below. It should be noted that the City’ s permitted investments are moderately more restrictive than the State guidelines. Attachment A provides a summary of the State of California Statues Applicable to Municipal Investments and a Glossary.

PERMITTED INSTRUMENTS CITY GUIDELINES
State or County Investment Pools
LAIF)
LAIF $75,000,000 / 50% of portfolio maximum
Federally Insured Banks/ Time
Deposits
5 Years / No limit
U.S. Treasuries 5 Years / No limit
U.S. Agency Obligations 5 Years / No limit
Bankers Acceptances 180 Days / 10% max / 5% per issuer
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7 PERMITTED INSTRUMENTS CITY GUIDELINES
Commercial Paper 397 Days / 25% max / 10% per issuer combined Medium- Term Notes 5 Years / 30% max
Negotiable Certificates of Deposit 5 Years / 30% max
Repurchase Agreements 1 Year / 10% max
Only with Master Repurchase Agreement /
Daily mark to market valuation
Money Market Mutual Funds 20% max / $500 million assets / 5% per issuer Joint Powers Authority Pool No Limit / $500 million assets / 5 years’ experience in investing
Reverse Repurchase Agreements Not Allowed
California State Obligations Not Allowed
California Local Obligations Not Allowed
Mutual Funds Not Allowed
Mortgage Pass Through Securities Not Allowed
Supranational Obligations Not Allowed
IV. Investment Program Controls
A. Separation of Reconciliation. A separation of responsibilities of reconciling bank statements and conducting investment transactions provides an internal control of checks and balances. Only individuals authorized by the City Manager and City Clerk may conduct investment transactions.

Consequently, individuals responsible for reconciling bank statements may not conduct investment transactions.

B. Third Party Safekeeping Agreements. Contractual agreement between the City and third-party custodian public investment agencies ( LAIF) is used to secure City invested funds.

C. Quarterly Treasurer’ s Report. The City Treasurer shall submit a quarterly investment report to the City Council. This report shall include types of investment, investment ratings, institutions involved, dates of purchases, dates of maturity, amount of deposits or cost of the security, current market value of securities, interest rates, investment fund balances and a statement that there are sufficient funds to meet the City’ s cash obligations.

D. Annual Policy Review. The City Manager shall review the City’ s investment policies annually and as needed to make recommendations for improvements to the City Council.

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8 ATTACHMENT A:

Summary of State of California Statutes Applicable to Municipal Investment The following investments are authorized by California State Code, Title 5, Division 2, Sections 53600 et seq. and 16429. 1.

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11 GLOSSARY
ACTIVE DEPOSITS: Demand or checking accounts, which receive revenues and pay disbursements.

AGENCIES: Federal agency securities.

ASKED: The price at which securities are offered.

BANKERS' ACCEPTANCE ( BA): short-term credit arrangements to enable businesses to obtain funds to finance commercial transactions. They are time drafts drawn on a bank by an exporter or importer to obtain funds to pay for specific merchandise. By its acceptance, the bank becomes primarily liable for the payment of the draft at its maturity. An acceptance is a highgrade negotiable instrument. Acceptances are purchased in various denominations for 30, 60, or 90 days, but no longer than 180 days. The interest is calculated on a 360-day discount basis similar to treasury bills. Local agencies may not invest more than 40% of their surplus money in banker’ s acceptance.

BASIS POINT: A basis point equals one one-hundredth of 1% (.01%).

BID: The price offered for securities.

BOOK- ENTRY SECURITIES: All U.S. Treasury and Federal Agencies are maintained on computerized records at the Federal Reserve now known as " wireable" securities.

BROKER: A broker brings buyers and sellers together for a commission paid by the initiator of the transaction or by both sides. In the money market, brokers are active in markets in which banks buy and sell money and in inter-dealer markets.

CERTIFICATES OF DEPOSIT ( CD): Time deposits of a bank or savings and loan. They are purchased in various denominations with maturities ranging from 30 to 360 days. The interest is calculated on a 360-day, actual day month basis and is payable monthly.

NEGOTIABLE CERTIFICATES OF DEPOSIT: Unsecured obligations of the financial institution, bank or savings and loan, bought at par value with the promise to pay face value plus accrued interest at maturity. They are high-grade negotiable instruments, paying a higher interest rate than regular certificates of deposit. The primary market issuance is in multiples of $1,000,000, the secondary market usually trades in denominations of $500,000, although smaller lots are occasionally available. As a matter of practice, only the ten largest U.S. banks, where there is a secondary market established for continued liquidity are considered for investment.

COLLATERAL: Securities, evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.

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12 ANNUAL COMPREHENSIVE FINANCIAL REPORT ( ACFR): The official annual report for the City of Canyon Lake. It includes five combined statements and basic financial statements for each individual fund and account group prepared in conformity with GAAP. It also includes supporting schedules necessary to demonstrate compliance with finance- related, legal and contractual provisions, extensive introductory material, and a detailed Statistical Section.

COMMERCIAL PAPER: Short-term unsecured promissory note issued by a corporation to raise working capital. These negotiable instruments are purchased at a discount to par value or at par value with interest bearing. Local agencies are permitted by State law to invest in commercial paper of " prime" quality of the highest ranking or of the highest letter and numerical ratings as provided by Moody' s Investor' s Service, Inc., or Standard and Poor's Corporation. Purchases of eligible commercial paper may not exceed 270 days maturity nor exceed 30% of the local agency' s surplus funds.

COUPON: ( a) The annual rate of interest that a bond' s issuer promises to pay the bondholder on the bond' s face value. ( b) A certificate attached to a bond evidencing interest due on a payment date.

DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account.

DELIVERY VERSUS PAYMENT ( DVP): There are two methods of delivery of securities:
delivery versus payment and delivery versus receipt ( also called free). Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipts is delivery of securities with an exchange of a signed receipt for the securities.

DEBENTURE: A bond secured only by the general credit of the issuer.

DISCOUNT: The difference between the cost price of a security and its value at maturity when quoted at lower than face value. A security selling below original offering price shortly after sale also is considered to be at a discount.

DISCOUNT SECURITIES: Non-interest- bearing money market instruments that are issued at a discount and redeemed at maturity for full face value ( e.g., U.S. Treasury bills).

DIVERSIFICATION: Dividing investment funds among a variety of securities and issuers offering independent returns.

DERIVATIVE: An asset that derives its value from another asset. For example, a call option on the stock of Coca- Cola is a derivative security that obtains value from the shares of Coca- Cola that can be purchased with the call option. Call options, put options, convertible bonds, futures contracts, and convertible preferred stock are examples of derivatives. A derivative can be either a risky or low-risk investment, depending upon the type of derivative and how it is used.

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13 FEDERAL CREDIT AGENCIES: Guaranteed directly or indirectly by the United States Government. All agency obligations qualify as legal investments and are acceptable as security for public deposits. They usually provide higher yields than regular Treasury issues with all of the same advantages. Examples include Federal Home Loan Bank, Federal Farm Credit Bank, FNMA Fannie Mae) and Federal Home Loan Mortgage Corp. ( Freddie Mac).

FEDERAL FUNDS: Non-interest- bearing deposits held by member banks at the Federal Reserve.

Also used to denote " immediately available" funds in the clearing sense. " Fed Funds" also used to refer to these funds.

FEDERAL FUNDS RATE: The rate of interest at which Fed funds are traded. This rate is currently pegged by the Federal Reserve through open- market operations.

FEDERAL OPEN MARKET COMMITTEE ( FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.

FEDERAL RESERVE SYSTEM: The central bank of the United States created by Congress and consisting of a seven- member Board of Governors in Washington, D.C., 12 Regional Banks and about 5,700 commercial banks that are members of the system.

INTEREST- BEARING ACTIVE DEPOSITS: Money- market accounts at a financial institution, ( e.g., bank, savings and loan, credit union). These accounts are demand accounts ( i.e., checking accounts) with restricted transaction activity.

LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes.

LAIF ( Local Agency Investment Fund): A special fund in the State Treasury which local agencies may use to deposit funds for investment. There is no minimum investment period, and the minimum transaction is $5,000, in multiples of $1,000 above that, with a maximum balance of 75,000,000 for any agency. The City is restricted to a maximum of fifteen transactions per month.

It offers high liquidity because deposits can be converted into cash in twenty- four hours and no interest is lost. All interest is distributed to those agencies participating on a proportionate share basis determined by the amounts deposited and the length of time they are deposited. Interest is paid quarterly. The State retains an amount for reasonable costs of making the investments, not to exceed one- quarter of one percent of the earnings. The interest rates are fairly high because of pooling the State's surplus cash with the surplus cash deposited. This creates a multi-billion- dollar money pool and allows diversified investments.

MARKET VALUE: The price at which a security is trading and could presumably be purchased or sold.

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14 MASTER REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase-- reverse agreements that establish each party' s rights in the transactions. A master agreement will often specify, among other things, the right of the buyerlender to liquidate the underlying securities in the event of default by the seller- borrower.

MATURITY: The date upon which the principal or stated value of an investment becomes due and payable.

MEDIUM- TERM CORPORATE NOTES: Unsecured promissory notes issued by a corporation organized and operating in the United States. These are negotiable instruments and are traded in the secondary market. Medium- term corporate notes can be defined as extended- maturity commercial paper. Local agencies are restricted by the Government Code to investments in corporations rated in the top three note categories by a nationally recognized rating service. Further restrictions are a maximum term of five years to maturity and total investments in medium- term corporate notes may not exceed 30% of the local agency' s surplus funds.

MONEY MARKET FUNDS: Open- ended mutual fund that invests in highly liquid and safe securities ( bills, commercial paper, bankers' acceptances, CD’ s, etc.) and pays money market rates of interest. The fund’ s net asset value remains a constant $ 1 a share.

OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank, as directed by the FOMC, to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit; sales have the opposite effect. Open market operations are the Federal Reserve' s most important and most flexible monetary policy tool.

PASSBOOK SAVINGS ACCOUNTS: Similar to an inactive deposit except that the period of time is not fixed. The interest rate is much lower than for a certificate of deposit, but the savings account is more flexible. Funds can be deposited and withdrawn according to daily needs.

PORTFOLIO: Collection of securities held by an investor.

PRIMARY DEALER: A group of government 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, banks, and a few unregulated firms.

PRIME RATE: The rate at which banks lend to their best or " prime" customers. Also known as the "reference rate."
PRUDENT PERSON RULE: An investment standard. In some states the law requires that a fiduciary, such as a trustee, may invest money only in a list of securities selected by the state ( the so-called legal list). In other states, the trustee may invest in a security if it is one which would be brought by a prudent person of discretion and intelligence who is seeking a reasonable income and preservation of capital.

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15 RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond or the current income return.

QUALIFIED PUBLIC DEPOSITORIES: A financial institution which does not claim exemption from the payment of any sales or compensating use or ad valorem taxes under the laws of this state, which has segregated for the benefit of the commission eligible collateral having a value of not less than its maximum liability and which has been approved by the Public Deposit Protection Commission to hold public deposits.

REPURCHASE AGREEMENTS ( RP OR REPO): A repo or reverse- repo is a short- term investment transaction. Banks buy temporarily idle funds from a customer by selling U.S.

Government or other securities with a contractual agreement to repurchase the same securities on a future date. Repurchase agreements are typically for one to ten days in maturity. The customer receives interest from the bank. The interest rate reflects both the prevailing demand for Federal funds and the maturity of the repo. Some banks will execute repurchase agreements for a minimum of $100,000 to $500,000, but most banks have a minimum of $1,000,000. A reverse- repo is exactly what the name implies.

SAFEKEEPING: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank' s vaults for protection.

SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution.

SECURITIES & EXCHANGE COMMISSION: Agency created by Congress to protect investors in securities transactions by administering securities legislation.

SETTLEMENT DATE: The date on which a trade is cleared by delivery of securities against funds. This date may be the same as the trade date or later.

TRADE DATE: The date on which a transaction is initiated or entered into by the buyer and seller.

TREASURY BILLS: Issued weekly with maturity dates up to one year. They are issued and traded on a discount basis with interest figured on 1 360-day basis, actual number of days. They are issued in amounts of $10,000 and up, in multiples of $5,000. They are a highly liquid security.

TREASURY NOTES: Initially issued with two- to ten- year maturities. They are actively traded in a large secondary market and are very liquid. The Treasury may issue note issues with a minimum of $1,000; however, the average minimum is $5,000.

TREASURY BOND: Long-term U.S. Treasury securities having initial maturities of more than ten years.

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16 UNIFORM NET CAPITAL RULE ( SEC RULE 15C3- 1): Securities and Exchange Commission requirement that member firms as well as nonmember broker- dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash.

WHEN-ISSUED TRADES: Typically, there is a lag between the time a new bond is announced and sold, and the time when it is issued. During this interval, the security trades " when, as, and if issued."
YIELD: The rate of annual income returned on an investment, expressed as a percentage. ( a) INCOME YIELD is obtained by dividing the current dollar income by the current market price for security. ( b) NET YIELD or YIELD TO MATURITY is the current income yield minus any premium above par or plus any discount from par in purchase price with the adjustment spread over the period from the date of purchase to the date of maturity of the bond.

YIELD TO MATURITY: The rate of return yielded by a debt security held to maturity when both interest payments and the investor’ s capital gain or loss on the security is considered.

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TERRY SHEA
735 E. CARNEGIE DRIVE, STE 100
SAN BERNARDINO CA 92408
STATEMENTFOR THE PERIOD FROM 06/01/2026 TO 06/30/2026
THIS IS YOUR REPORT OF INVESTMENTS AND TRANSACTIONS FOR THE PERIOD. INCLUDED

IN THE REPORT ARE
* PORTFOLIO: SUMMARY GRAPHICAL DISPLAY WITH MARKET VALUE & PERCENT * ACTIVITY SUMMARY: MARKET VALUE WITH TRANSACTION SUMMARY * PORTFOLIO STATEMENT: A LISTING OF COST AND MARKET VALUE OF ASSETS

HELD IN THE PORTFOLIO
COST BASIS APPLICABLE FOR CALCULATING CAPITAL GAINS AND LOSSES.

MARKET VALUE IS THE CURRENT VALUE OF EACH ASSET FOR MOST STOCKS AND BONDS.

MARKETS ARE THE CLOSING PRICES ON THE LAST TRADING DAY OF THE PERIOD. * TRANSACTION STATEMENT: A COMPLETE LISTING FOR THE PERIOD GROUPED BY TRANSACTION TYPE.
* DISCLOSURES: CITIZENS BUSINESS BANK MAY RECEIVE RESEARCH AND OTHER BENEFITS FROM BROKER DEALERS WHICH MAY BE CONSIDERED COMPENSATION TO US. UPON REQUEST WE WILL DISCLOSE DETAILS OF ANY COMPENSATION RECEIVED.
* TO TRUST BENEFICIARIES: UNDER SECTION 17200 OF CALIFORNIA PROBATE CODE,

YOU MAY PETITION THE COURT TO OBTAIN A COURT REVIEW OF THE ACCOUNT AND THE ACTS OF THE TRUSTEE. CLAIMS AGAINST THE TRUSTEE FOR BREACH OF TRUST

MUST BE MADE WITHIN THREE YEARS FROM THE DATE OF RECEIPT OF AN ACCOUNTING OR OTHER REPORT DISCLOSING FACTS GIVING RISE TO THE CLAIM.

City Council Agenda,

City Council Agenda,

Account Summary Statement Page 2
Account Number:

June 01, 2026 To June 30, 2026
Performance Summary - Total Returns
Since
1 3 1 2 3 Inception
Market Value Month Months Year Years Years 03/01/2010
Total Portfolio 4,297,351 0.23 0.83 3.44 4.48 4.66 1.46 Return On Indexes
Gov Bench 2 0.06 0.25 2.74 4.38 4.32 1.68
Return Comparison
0 1M 3M 1Y 2Y 3Y SI
Total Portfolio Weighted Index
PAST RESULTS ARE NOT INDICATIVE OF FUTURE INVESTMENT RESULTS. FUND DATA IS ON TRADE DATE BASIS. PERFORMANCE RESULTS ARE GROSS OF MANAGEMENT FEES. RETURNS FOR PERIODS LONGER THAN ONE YEAR ARE ANNUALIZED. MARKET VALUE DOES NOT INCLUDE ACCRUED INCOME.

City Council Agenda,

Account Summary Statement Page 3
Account Number:

June 01, 2026 To June 30, 2026
Portfolio Statement
Quantity Description Market Value Cost Basis
Fixed Income
037833CJ7
125 ,000 .000 APPLE INC DTD 02/09/2017 3.35% 124 ,325 .00 121, 254. 58 02/09/2027-2026
3130ANJT8
100 ,000 .000 FEDERAL HOME LOAN BANKS CONS DTD 99 ,540 .00 99, 925. 00 08/26/2021 .9% 08/26/2026
3130ANND8
150 ,000 .000 FEDERAL HOME LOAN BANKS CONS DTD 149 ,349 .00 150, 000. 00 08/26/2021 1.05% 08/26/2026-2022
Total Fixed Income 373 ,214 .00 371, 179. 58
Cash And Cash Equivalents
94975P405
3, 913 ,406 .770 ALLSPRING FUNDS TR GOVT MMKT I 3 ,913 ,406 .77 3, 913, 406. 77 Total Cash And Cash Equivalents 3 ,913 ,406 .77 3, 913, 406. 77 Miscellaneous
CBB000AB6
1 .000 INVESTMENT MANAGEMENT AGREEMENT 0 .00 0. 00
CITY OF CANYON LAKE A/C#
1035003119
Total Miscellaneous 0 .00 0. 00
Grand Total Assets 4 ,286 ,620 .77 4, 284, 586. 35
Account Activity Summary
Cost Basis Market Value
Total Cash Excluding Cash Including Cash
Balances Beginning Of Period 0 .00 2, 279, 381. 01 2 ,288 ,951 .19 Prior Accruals 7 ,889 .51-
Unrealized Appreciation This Period 2 ,005 ,559 .09
Current Accruals 10 ,730 .47
Bank Fees 728 .26- 0. 00 728 .26-
Cash Management 2 ,005 ,205 .34- 2, 005, 205. 34 2 ,005 ,205 .34- Dividends 5 ,933 .60 0. 00 5 ,933 .60
Other Receipts 2 ,000 ,000 .00 0. 00 2 ,000 ,000 .00
Realized Gain/loss 0 .00
Non Cash Asset Changes
Balances End Of Period 0 .00 4, 284, 586. 35 4 ,297 ,351 .24 City Council Agenda,

Account Summary Statement Page 4
Account Number:

June 01, 2026 To June 30, 2026
Transaction Statement
Date Quantity Description Transaction Cash Cost Basis
Type
06/01/26 Beginning Balance 0.00 2,279,381.01
Other Receipts
06/17/26 RECEIVED FROM CITIZENS BUSINESS CASH RCVD 2,000,000.00

BANK CASH RECEIVED FROM CBB ACCT
ENDING 5402 PER CLIENT WRITTEN &

VERBALLY CONFIRMED REQUEST DATED
6/17/2026
Total Other Receipts 2,000,000.00 0.00
Bank Fees
06/29/26 MANAGEMENT FEES CITIZENS DISBURSEMENT 728.26-

BUSINESS BANK
FOR THE PERIOD ENDING 06/20/2026
Total Bank Fees 728.26- 0.00
Cash Management
94975P405
06/30/26 2,005,205.340 NET CASH MANAGEMENT NET CASH MGMT 2,005,205.34- 2,005,205.34 Total Cash Management 2,005,205.34- 2,005,205.34
Dividends
94975P405
06/01/26 DIVIDEND ON ALLSPRING FUNDS TR DIVIDEND 5,933.60 GOVT MMKT I PAYABLE 06/01/2026
EFFECTIVE 05/31/2026 TAX
EFFECTIVE 05/31/2026
Total Dividends 5,933.60 0.00
06/30/26 Ending Balance 0.00 4,284,586.35
City Council Agenda,

Account Summary Statement Page 5
Account Number:

June 01, 2026 To June 30, 2026
Important Information
Year-end statement REMINDER:

If your account was active on our trust and investment system that was upgraded on 2/3/25, your 12/31/25 annual statement will only include eleven (11) months of information from the new system under your new account number. This information should be reviewed along with your separate January, 2025 monthly statement which was generated under your old account number in order to represent a complete, full year of statement activity. Weblink users can readily obtain that historical statement from that site. Clients who receive printed statements in the mail were notified to retain those statements for reference. If you need additional assistance, please contact your relationship manager.

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ITEM NO. 9

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Jeff LaTendresse, Fire Chief
DATE: 08/05/2026
SUBJECT: Consideration of a Resolution Authorizing the City Manager to Enter into a Lease/Purchase Agreement with PNC Equipment Finance, LLC, for a New Type I Fire Engine in the Amount of $1,136,301.95
Recommendation:

Adopt Resolution No. 2026-36 authorizing the City Manager to enter into a Lease/Purchase Agreement with PNC Equipment Finance, LLC, for a new Type I structural fire engine in the amount of $1,136,301.95.

Background/Analysis:

At the October 11, 2023, City Council meeting, the City Council approved the purchase of a new Type I structural fire engine from South Coast Fire Equipment of Corona. The engine will be built by Pierce Manufacturing and will be delivered in approximately forty-three to forty-six months. The fire engine will be Lease/Purchased through PNC Equipment Finance, LLC, and as part of the lease agreement a Resolution is required. The engine is expected to be delivered to the City in May 2027.

Fiscal Impact Yes/No:No
Additional Fiscal Information:

None with the adoption of the Resolution. The first lease payment will not be due until August of FY 2027/2028. The cost of the new engine is $1,176,148.24, and the City received a prepayment discount of $39,846.29, leaving a balance of $1,136,301.95. This amount will be leased on a ten-year term with an annual payment of $151,547.06 at a 5.61% interest rate. The proposed costs will be included in the City’s future financial projections.

Attachments:
1 - Resolution
2 - Terms
City Council Agenda,

RESOLUTION NO. 2026-36

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE,

CALIFORNIA, ADOPTING A RESOLUTION AUTHORIZING THE CITY MANAGER

TO ENTER INTO A LEASE/PURCHASE AGREEMENT WITH PNC EQUIPMENT

FINANCE, LLC, FOR A NEW TYPE I FIRE ENGINE IN THE AMOUNT OF $1,176,148.24
WHEREAS, the City of Canyon Lake is a political subdivision of the State in which Municipality is located (the “State”) and is duly organized and existing pursuant to the Constitution and laws of the State. and
WHEREAS, South Coast Fire Equipment is a local vendor for Pierce Manufacturing which provides fire engines for the Cities of Murrieta, Riverside, Palm Springs, Cathedral City; and WHEREAS, the Houston-Galveston Area Council (H-GAC) conducted a competitive bid process and has obtained competitive pricing for such vehicles and participating members; and WHEREAS, THE City is authorized under the Canyon Lake Municipal Code section 3.08.360 to award contracts for materials, supplies, equipment or services; and WHEREAS, the lease/purchase agreement will commence in August, 2027; and WHEREAS, PNC Bank, National Association (“Lessor”) shall act as Lessor under said Leases.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE DOES RESOLVE AS FOLLOWS:

Section 1. The above recitals are true and correct and are incorporated herein by reference.

Section 2. The City Council authorizes the City Manager, or their designee, enter into a lease/purchase agreement for (1) Type I structural fire engine from PNC Equipment Finance through H-GAC for a purchase cost of $1,176,148.24.

Section 3. The provisions of this Resolution are severable and if any provision, clause, sentence, word or part thereof is held illegal, invalid, unconstitutional, or inapplicable to any person or circumstances, such illegality, invalidity, unconstitutionality, or inapplicability shall not affect or impair any of the remaining provisions, clauses, sentences, sections, words or parts thereof of the Resolution or their applicability to other persons or circumstances.

Section 4. That the City Clerk shall certify to the adoption of this Resolution and that the same shall be in full force and effect.

City Council Agenda,

Section 5. This Resolution shall take effect immediately upon its adoption.

PASSED, APPROVED AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the Mayor’s signature above and certify that the City Council duly adopted this Resolution as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
City Council Agenda,

Tax Exempt Lease Purchase
SALES ORGANIZATION: South Coast – Bryden Newell 7/27/2026 LESSEE: City of Canyon Lake Contact information:

TYPE OF EQUIPMENT: One (1) Pierce PUC Pumper Kim Simon
EQUIPMENT COST: $1,176,148.24 Locator: B4-B230-06-07
PREPAYMENT DISCOUNTS: $39,846.29 155 East Broad St
AMOUNT TO FINANCE: $1,136,301.95 Columbus, OH 43215
DELIVERY TIME: Per Contract Ph: 614-670-3994
PAYMENT MODE: Annual In Arrears Fax (866) 852-3101
FIRST PAYMENT DUE DATE: August 2027 [email protected]
LEASE COMMENCEMENT DATE: August 2026
Term 10 years
Number of Payments 10 Annual
Payment Amount $151,547.06
Interest rate: 5.61%
NOTE: All lease documents must be fully executed within 7 days of the date of this proposal. Failure to receive completed documents may alter the final payment schedule due to changes in rates and/or discounts.

PERFORMANCE BOND: To utilize the prepay program, a performance bond is required. Said performance bond shall be paid for directly to Pierce Manufacturing or financed by PNC Equipment Finance as part of the transaction
ESCROW FUNDING OPTION: At lease closing, if all of the equipment has not yet been delivered, Lessor will fund an escrow account from which disbursem ents will be made to the equipment provider(s) upon receipt of a Requisition Request and Certificate of Acceptance from Lessee. Esc row agent will either be Lessor or third-party provider selected by Lessor and approved by Lessee. All escrow earnings will be for the benefit of Lessee. The escrow agent will assess a $250.00 account set up fee payable at closing.

TYPE OF FINANCING: Tax-exempt Lease Purchase Agreement with a $1.00 buy out option at end of lease term. Said agreement shall be a net lease arrang ement whereby lessee is responsible for all costs of operation, maintenance, insurance, and taxes.

BANK QUALIFICATION: This proposal assumes that the lessee will not be issuing more than $10 million in tax -exempt debt this calendar year. Furthermore, it is assumed that the lessee will designate this issue as a qualified tax-exempt obligation per the tax act of 1986.

LEGAL TITLE: Legal title to the equipment during the lease term shall vest in the lessee, with PNC Equipment Finance perfecting a first security interest AUTHORIZED SIGNORS: The lessee's governing board shall provide PNC Equipment Finance with its resolution or ordinance authorizing this agreement and shall designate the individual(s) to execute all necessary documents used therein.

LEGAL OPINION: The lessee's counsel shall furnish PNC Equipment Finance with an opinion covering this transaction and the documents used herein. This opinion shall be in a form and substance satisfactory to PNC Equipment Finance.

VOLUNTEER FIRE DEPARTMENTS: If Lessee is a Volunteer Fire Department, a public hearing under the requirements of Section 147(f) of the Internal Revenu e Code of 1986 shall be conducted to authorize this transaction. It is recommended that a notice of the public hearing be publishe d 10 to 14 days in advance of the public hearing.

City Council Agenda,

This proposal will be valid for Seven Days (7) from the above date and is subject to final credit approval by PNC Equipment Finance and approval of the lease documents in PNC Equipment Finance's sole discretion. To render a credit decision, lessee shall provide PNC Equipment Finance with their most recent three years' audited financial statements, copy of their most recent interim financial statement, and current budget.

Accepted by:____________________________________ Proposal submitted by _____________________ City Council Agenda,

ITEM NO. 10

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Ruby Manzano, Community Development Manager
DATE: 08/05/2026
SUBJECT: Consideration of a Resolution Authorizing the City's Participation in the County of Riverside Urban County Program for Federal Fiscal Years 2027-2028, 2028-2029, 2029- 2030 and Approving the Execution of a Cooperation Agreement with the County Recommendation:

Adopt Resolution No. 2026-37 authorizing the City's participation in the County of Riverside Urban County Program for Federal Fiscal Years 2027-2028, 2028-2029, and 2029-2030, approving the Cooperation Agreement between the County of Riverside and the City of Canyon Lake, and authorizing the City Manager to execute the agreement on the City's behalf.

Background/Analysis:

The County of Riverside administers the Urban County Program, which enables participating local jurisdictions to receive and benefit from federal housing and community development funding administered by the U.S. Department of Housing and Urban Development (HUD). Through the Urban County Program, participating agencies may be eligible to receive funding through the Community Development Block Grant (CDBG), Home Investment Partnerships Program (HOME), and Emergency Solutions Grant (ESG).

To continue participating in the Urban County Program, the City of Canyon Lake must enter int a Cooperation Agreement with the County of Riverside for Federal Fiscal Years 2027-2028, 2028-2029, and 2029-2030. The agreement establishes the City's participation as a cooperating unit of local government and allows the County to include the City in its Urban County designation and Consolidated Planning process.

Participation in the Urban County Program preserves the City's eligibility to apply for and receive federal funding opportunities that may support future community development, public facility improvements, housing, and eligible public service projects. The Cooperation Agreement also allows the City to participate in the County's required planning efforts associated with these federal grant programs.

Approval of the Cooperation Agreement ensures the City remains eligible to participate in the program throughout the three-year term and maintains access to potential funding opportunities administered through the County. Although the County has requested that the Cooperation Agreement be executed by July 31, the City was granted an extension because the City Council does not have a meeting scheduled in July.

Fiscal Impact Yes/No:No
City Council Agenda,

Additional Fiscal Information:

No fiscal impact
Attachments:
1 - Resolution
2 - Participation Letter
3 - Cooperation Agreement
City Council Agenda,

RESOLUTION NO. 2026-37

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, AUTHORIZING PARTICIAPTION IN THE COUNTY OF RIVERSIDE’S URBAN COUNTY PROGRAM FOR FISCAL YEARS 2027-2028, 2028-2029, AND 2029- 2030
WHEREAS, the City of Canyon Lake (“City”) is a municipal corporation in the County of Riverside, State of California and
WHEREAS, City of Canyon Lake has elected to participate as unit of local government (Cooperating City) in the County of Riverside’s Urban County Program for Federal Fiscal Years 2027-28, 2028-29, and 2029-30; and
WHEREAS, the Cooperation Agreement will allow the County and City to carry-out activities which are funded by Community Development Blog Grant (CDBG), Home Investment Partnerships Program (HOME) funds, and Emergency Solutions Grant (ESG); and WHEREAS, the Cooperation Agreement will allow the cooperating City to participate in the Urban County Consolidated Planning Programs.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE DOES RESOLVE AS FOLLOWS:

Section 1. The above recitals are true and correct and are incorporated herein by reference.

Section 2. The Cooperation Agreement between the County of Riverside and the City of Canyon Lake is hereby approved.

Section 3. The City Council hereby authorizes and directs the City Manager to execute the Cooperation Agreement on behalf of the City of Canyon Lake.

Section 4. The provisions of this Resolution are severable and if any provision, clause, sentence, word or part thereof is held illegal, invalid, unconstitutional, or inapplicable to any person or circumstances, such illegality, invalidity, unconstitutionality, or inapplicability shall not affect or impair any of the remaining provisions, clauses, sentences, sections, words or parts thereof of the Resolution or their applicability to other persons or circumstances.

Section 5. That the City Clerk shall certify to the adoption of this Resolution and that the same shall be in full force and effect.

City Council Agenda,

Section 6. This Resolution shall take effect immediately upon its adoption.

PASSED, APPROVED AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the Mayor’s signature above and certify that the City Council duly adopted this Resolution as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
City Council Agenda,

City Council Agenda,

City Council Agenda,

Cooperation Agreement For CDBG, HOME And ESG Funds 2027-2029

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COOPERATION AGREEMENT

FOR THE COMMUNITY DEVELOPMENT BLOCK GRANT,

HOME INVESTMENT PARTNERSHIPS PROGRAM, AND

EMERGENCY SOLUTIONS GRANT
FOR FISCAL YEARS 2027, 2028, 2029
This Cooperation Agreement for the Community Development Block Grant, HOME Investment Partnerships Program, and the Emergency Solutions Grant for Fiscal Years 2027, 2028, and 2029, hereinafter referred to as “Agreement” is made and entered into this ______ day of __________ 2026, by and between the COUNTY OF RIVERSIDE, a political subdivision of the State of California, hereinafter referred to as "COUNTY", and CITY OF CANYON LAKE, an incorporated municipality within the geographical boundaries of the COUNTY, hereinafter referred to as "CITY.” City and County individually referred to herein as “Party” and collectively as the “Parties.”

RECITALS
WHEREAS, the Housing and Community Development Act of 1974, as amended (42 U.S.C.A. § 5301 et seq.) (Public Law 93-383), hereinafter called "ACT", provides that Community Development Block Grant funds hereinafter referred to as "CDBG", may be used for the support of activities that provide decent housing, suitable living environments, and expanded economic opportunities principally for persons of low and moderate-income; and WHEREAS, the HOME Investment Partnerships Act program, hereinafter referred to as “HOME,” was enacted as Title II of the National Affordable Housing Act of 1990, for the purposes of: expanding the supply of decent, affordable housing for low and very-low income families with emphasis on rental housing; building State and local capacity to carry out affordable housing programs; and providing for coordinated assistance to participants in the development of affordable low-income housing; and
WHEREAS, the Emergency Solutions Grant, hereinafter referred to as “ESG,” was authorized by the McKinney-Vento Homeless Assistance Act of 1987 and the Homeless Emergency Assistance and Rapid Transition to Housing (HEARTH) Act of 2009. The objectives of the ESG program are to increase the number and quality of emergency shelters and transitional City Council Agenda,

Cooperation Agreement For CDBG, HOME And ESG Funds 2027-2029

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housing facilities for homeless individuals and families, to operate these facilities and provide essential social services, and to help prevent homelessness; WHEREAS, CDBG regulations require counties to re-qualify as an Urban County under the CDBG program every three (3) years.

WHEREAS, the chief executive officer of the COUNTY is authorized to execute this Agreement pursuant to Riverside County Ordinance No. 442.

WHEREAS, the City Manager or Mayor of CITY is authorized to execute this Agreement on the CITY’s behalf.

WHEREAS, the COUNTY Board of Supervisors on July 14, 2026 via Minute Order 30623 authorized the COUNTY Director of Housing and Workforce Solutions to execute this agreement on behalf of the COUNTY.

NOW THEREFORE, in consideration of the mutual covenants herein set forth and the mutual benefits to be derived there from, the parties agree as follows:

1. GENERAL.
(a). This Agreement gives COUNTY authority to undertake, or assist in undertaking, activities for Fiscal Years 2027, 2028, and 2029, that will be funded from the CDBG, HOME, and ESG programs and from any program income generated from the expenditure of such funds. COUNTY and CITY agree to cooperate, to undertake, or to assist in undertaking, community renewal and lower-income housing assistance activities. COUNTY is qualified as an "Urban County" under the ACT. CITY, by executing this Agreement, hereby gives notice of its election to participate in an Urban County’s Community Development Block Grant (CDBG), Home Investment Partnerships Act (HOME), and Emergency Solutions Grant (ESG) programs, hereinafter referred to as "Urban County Programs".
(b). By executing this Agreement, CITY understands that it may not apply for grants from appropriations under the Small Cities or State CDBG Programs for fiscal years during the period in which it participates in the Urban County’s CDBG program, and that CITY may only participate in the HOME program through the COUNTY’S Urban County Programs, not a HOME City Council Agenda,

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consortium. The CITY may also apply for HOME funds from the State of California, if permitted by the State.
(c). By executing this Agreement, CITY understands that it may only receive a formula allocation of ESG funds through the COUNTY’S Urban County Programs. The CITY may also apply for ESG funds from the State of California, if permitted by the State.

2. TERM.

The term of this Agreement shall be for three (3) years commencing on October 1, 2026, and expiring on September 30, 2029, unless an earlier date of termination is fixed by U.S.

Department of Housing and Urban Development, hereinafter called HUD, pursuant to ACT.

This Agreement shall remain in effect until funds granted and program income received during the three-year program period are expended and the funded activities completed.

Neither the COUNTY nor the CITY may terminate, withdraw, or be removed from the program during the three-year program period.

This Agreement will renew automatically for participation in one successive threeyear Urban County qualification period (Federal Fiscal Years 2027-29), unless the CITY or the COUNTY provides written notice to the other party that it elects not to participate in a new qualification period. The terminating party shall send a copy of the notice of termination to the HUD field office by the date specified on the HUD Exchange Urban Counties website. By executing this Agreement, the CITY acknowledges that it has been notified in writing of the CITY’s right to make this election. A copy of this Agreement will be sent to the HUD field office by the date specified on the HUD Exchange Urban Counties website.

The Parties agree to adopt amendment(s) to this Agreement as may be required by HUD to meet any new Urban County Qualification requirement(s), when applicable. Failure by either Party to adopt any such amendment, and to submit such amendment to HUD, will void the agreement for such qualification period.

3. PREPARATION OF FEDERALLY REQUIRED FUNDING APPLICATIONS.

The County of Riverside Housing and Workforce Solutions, subject to approval of COUNTY’s Board of Supervisors, shall be responsible for preparing and submitting to the U.S.

Cooperation Agreement For CDBG, HOME And ESG Funds 2027-2029

City Council Agenda,

Cooperation Agreement For CDBG, HOME And ESG Funds 2027-2029

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Department of Housing and Urban Development (HUD), in a timely manner, all reports and statements required by the ACT and the Federal regulations promulgated by HUD to secure entitlement grant funding under the CDBG, HOME, and ESG programs. This duty shall include the preparation and processing of COUNTY Housing, Community, and Economic Development Needs Identification Report, Citizen Participation Plan, the County Five-Year Consolidated Plan, One-Year Action Plan, Consolidated Annual Performance and Evaluation Report (CAPER), and other related programs which satisfy the application requirements of ACT and its regulations.

4. COMPLIANCE WITH FEDERAL STATUTES, REGULATIONS AND
OTHER APPLICABLE STATUTES, REGULATIONS AND ORDINANCES.
(a) COUNTY and CITY will comply with the applicable provisions of the ACT and those Federal regulations promulgated by HUD pursuant thereto, as the same currently exists or may hereafter be amended.
(b) The COUNTY and CITY are hereby obligated to take all actions necessary to assure compliance with COUNTY’s certification regarding affirmatively furthering fair housing pursuant to Section 104 (b) of Title I of ACT, as amended. (c) COUNTY and CITY will comply with the applicable provisions of the following: National Environmental Policy Act of 1969; Title VI of the Civil Rights Act of 1964 and the implementing regulations at 24 CFR Part 1; The Fair Housing Act, Title VIII of the Civil Rights Act of 1968, the implementing regulations at 24 CFR Part 100, and the duty to affirmatively further fair housing (AFFH); Title 24 Code of Federal Regulations part 570; Cranston-Gonzales National Affordable housing Act (Public Law 101-625); Executive Order 11063, as amended by Executive Order 12259; Executive Order 11988; the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42 U.S.C.§4630, et. seq.); Section 109 of Title I of the ACT and implementing regulations at 24 CFR part 6, including Section 504 of the Rehabilitation Act of 1973 and the implementing regulations at 24 CFR Part 8, Title II of the Americans with Disabilities Act and the implementing regulations at 28 CFR part 35, the Age Discrimination Act of 1975 and the implementing regulations at 24 CFR part 146, Section 3 of the Civil Rights Act of 1963, as amended, Section 3 of the Housing and Urban Development Act of 1968, the Uniform City Council Agenda,

Cooperation Agreement For CDBG, HOME And ESG Funds 2027-2029

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Relocation Assistance and Real Property Acquisition Policies Act of 1970 and the implementing regulations at 49 CFR Part 24, and Section 104(d) of the Act and implementing regulations at 24 CFR Part 42; and other Federal or state statute or regulation applicable to the use of CDBG, HOME Investment Partnerships Act (enacted as Title II of the National Affordable Housing Act of 1990), and Emergency Solutions Grant funds.
(d) CITY agrees that the Urban County Program funding for activities in, or in support of, the CITY are prohibited if CITY does not affirmatively further fair housing within CITY’S jurisdiction or impedes COUNTY actions to comply with its fair housing certification. (e) CITY and COUNTY shall meet the citizen participation requirements of 24 CFR 570.301 and provide Urban County Program citizens with all of the following:
i. The estimate of the amount of CDBG funds proposed to be used for activities that will benefit persons of low and moderate-income; ii. A plan for minimizing displacement of persons as a result of activities assisted with CDBG funds and to assist persons actually displaced as a result of such activities;
iii. A plan that provides for and encourages citizen participation, with particular emphasis on participation by persons of low and moderate-incomes, residents of slum and blighted areas, and of areas in which funds are proposed to be used, and provides for participation of residents in low and moderate-income neighborhoods; iv. Reasonable and timely access to local meetings, information, and records relating to the grantee’s proposed use of funds, as required by the regulations of the Secretary, and relating to the actual use of funds under the ACT; v. Provide for public meetings to obtain citizen views and to respond to proposals and questions at all stages of the community development program, including at least the development of needs, the review of proposed activities and review of program performance.

Meeting shall be held after adequate notice, at times and locations convenient to potential or actual beneficiaries, and with accommodation for the disabled.

City Council Agenda,

Cooperation Agreement For CDBG, HOME And ESG Funds 2027-2029

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(f). CITY shall develop a community development plan, for the period of this Agreement, which identifies community development and housing needs and specifies both short and long-term community development objectives.
(g). CITY certifies, to the best of its knowledge and belief, that:
i. No Federal appropriated funds have been paid or will be paid, by or on behalf of the CITY, to any person influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress, in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment or modification of any Federal contract, grant, loan or cooperative agreement.
ii. If any funds other than Federally-appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress, in connection with this Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete and submit standard Form-LLL, "Disclosure Form to Report Lobbying", in accordance with its instructions.
iii. The CITY shall require that the language provided in Sections 4(c) of this Agreement be included in the award documents for all sub-awards at all tiers (including subcontracts, sub- grants and contracts under grants, loans, and cooperative agreements) and that all sub-recipients shall certify and disclose accordingly. This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into.
(iv). In accordance with Section 519 of Public Law 101-144, (the 1990 HUD Appropriations Act), the CITY certifies that it has adopted and is enforcing a policy prohibiting the use of excessive force by law enforcement agencies within its jurisdiction against any individuals engaged in non-violent civil rights demonstrations, and that it has adopted and is enforcing applicable State and local laws against physically barring entrance to, or exit from, a City Council Agenda,

Cooperation Agreement For CDBG, HOME And ESG Funds 2027-2029

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facility or location which is the subject of such non-violent civil rights demonstrations within its jurisdiction.

5. COMPLIANCE WITH POLICY AND PROGRAM OBJECTIVES.

The COUNTY’s Board of Supervisors have adopted policies and procedures to ensure efficient and effective administration of the CDBG, HOME and ESG programs. COUNTY will provide these policies and procedures to CITY within a reasonable time after this Agreement’s commencement date. COUNTY and City agree to comply with these said policies and program objectives and to take no actions to obstruct implementation of the approved 2024-2029 Five Year Consolidated Plan and the subsequent Five-Year Consolidated Plan.

6. OTHER AGREEMENTS
Pursuant to Federal regulations at 24 CFR 570.501(b), CITY is subject to the same requirements applicable to sub-recipients, including the requirement of a written agreement set forth in Federal regulations at 24 CFR 570.503. For each fiscal year during the term of this Agreement, COUNTY and CITY shall enter into an additional agreement, commonly known as a Supplemental Agreement, that will have a term coinciding with a CDBG Program Year and enumerate the project(s) CITY will implement with its entitlement funds. Said Supplemental Agreement will set forth the time schedule for completion of said project(s) and any funding sources, in addition to entitlement funds, that will be used in completing the project(s). If substantial compliance with the completion schedule, due to unforeseen or uncontrollable circumstances, cannot be met by CITY, the schedule for the project(s) may be extended by COUNTY. If COUNY determines that substantial progress toward drawdown of funds is not made during the term of the Supplemental Agreement, the entitlement funds associated with the project(s) may be reprogrammed by COUNTY, to other activities as determined by COUNTY, after COUNTY provides appropriate written notice to CITY. COUNTY's decision not to extend the completion schedule associated with the project(s), or to reprogram the entitlement funds associated with the project(s), will not excuse CITY from complying with terms of this Agreement.

7. DETERMINATION OF PROJECTS TO BE FUNDED AND
DISTRIBUTION OF ENTITLEMENT FUNDS.

City Council Agenda,

Cooperation Agreement For CDBG, HOME And ESG Funds 2027-2029

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CITY agrees to submit to COUNTY in writing, no later than the date specified by COUNTY prior to each program year, the activities that the CITY desires to implement with its entitlement funds, said designation to comply with statutory and regulatory provisions governing citizen's participation. Said designation is to be reviewed by the COUNTY's Housing and Workforce Solutions to determine that the projects are eligible under Federal regulations for funding and inclusion in the One Year Action Plan of the County’s Five-Year Consolidated Plan and consistent with both Federal and COUNTY policy governing use of Community Development Block Grant (CDBG) funds.

In the event that CITY fails to submit to COUNTY the identified activities that the CITY desires to implement with its entitlement funds by the date specified prior to each program year, the COUNTY may determine the activities to be funded, without consent of the CITY, consistent with both Federal and COUNTY policy governing use of Community Development Block Grant (CDBG) funds.

Consistent with Sections 3, 4, 5, 6, and 7 of this Agreement, COUNTY's Board of Supervisors will make the final determination of the distribution and disposition of all CDBG funds received by COUNTY pursuant to the Act.

8. COMMUNITY DEVELOPMENT BLOCK GRANT MANUAL.

CITY warrants that those officers, employees, and agents, retained by it and responsible for implementing projects funded with CDBG have received, reviewed, and will follow the Community Development Block Grant Manual that has been prepared and amended by COUNTY, which Manual is incorporated herein and made a part hereof by this reference.

9. REAL PROPERTY ACQUIRED OR PUBLIC FACILITY
CONSTRUCTED WITH CDBG FUNDS.

When CDBG funds are used, in whole or in part, by CITY to acquire real property or to construct a public facility, CITY shall comply with the National Environmental Policy Act of 1969 (42 U.S.C. § 4321, et seq.), the California Environmental Quality Act (Cal. Pub. Resources Code § 21000, et seq.), the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42 U.S.C. § 4630, et seq.), and California Government Code Sections 7260 et seq., City Council Agenda,

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as those laws may be amended from time-to-time and any Federal or state regulations issued to implement the aforementioned laws.

In addition, the following is to occur:
(a) Title to the real property shall vest in CITY;
(b) The real property title will be held by or the constructed facility will be maintained by the CITY for the approved use until five years after the date that the CITY is no longer considered by HUD to be a part of the metropolitan city or urban county, pursuant to 24 CFR 570.501(b).
(c) While held by CITY, the real property or the constructed facility is to be used exclusively for the purpose for which acquisition or construction was originally approved by COUNTY;
(d) CITY shall provide timely written notice to COUNTY of any action which would result in a modification or change in the use of the real property purchased or improved, in whole or in part, with CDBG or HOME funds from that planned at the time of acquisition or improvement, including disposition.
(e) CITY shall provide timely written notice to citizens and opportunity to comment on any proposed modification or change;
(f) Written approval from COUNTY must be secured if the property or the facility is to be put to an alternate use that is or is not consistent with Federal regulations governing CDBG funds;
(g) Should CITY desire during the five (5) year period to use the real property or the constructed facility for a purpose not consistent with applicable Federal regulations governing CDBG funds or to sell the real property or facility, then:
(i) If CITY desires to retain title, it will have to reimburse either COUNTY or the Federal government an amount that represents the percentage of current fair market value that is identical to the percentage that CDBG funds initially comprised when the property was acquired or the facility was constructed;
(ii) If CITY sells the property or facility, or is required to sell the property City Council Agenda,

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or facility, CITY is to reimburse the COUNTY an amount that represents the percentage of proceeds realized by the sale that is identical to the percentage that CDBG funds comprised of the monies paid to initially acquire the property or construct the facility. This percentage amount will be calculated after deducting all actual and reasonable cost of sale from the sale proceeds.

10. DISPOSITION OF INCOME GENERATED BY THE EXPENDITURE
OF CDBG FUNDS.

CITY shall inform COUNTY in writing of any income generated by the expenditure of CDBG funds received by CITY from COUNTY. CITY may not retain program income so generated. Any and all program income shall be returned to the County and may only be used for eligible activities in accordance with all CDBG requirements, including all requirements for citizen participation.

The COUNTY is required by HUD to monitor and report the receipt and use of all program income. CITY is required to track, monitor, and report any and all program income as requested by COUNTY.

11. TERMINATION.

Except as provided for in Section 2, CITY and COUNTY cannot terminate or withdraw from this Agreement while it remains in effect.

12. NOTICES.

All correspondence and notices required or contemplated by this Agreement shall be delivered to the respective parties at the addresses set forth below and are deemed submitted two days after their deposit in the United States mail, postage prepaid:

COUNTY OF RIVERSIDE CITY OF CANYON LAKE
Heidi Marshall, Director Arron Brown, City Manager
County of Riverside HWS City of Canyon Lake
3403 Tenth Street, Suite 300 31516 Railroad Canyon Road Riverside, CA 92501 Canyon Lake, CA 92587
City Council Agenda,

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13. AGREEMENT ADMINISTRATION.

The City Manager of the CITY, and the Director of Housing and Workforce Solutions of County of Riverside, or their designee, shall administer the terms and conditions of this Agreement for their respective city or county.

14. COOPERATION; FURTHER ACT.

The PARTIES shall cooperate fully with one another, and shall take any additional acts or sign any additional documents as may be necessary, appropriate or convenient to attain the purpose of the Agreement.

15. NO THIRD-PARTY BENEFICIARIES.

This Agreement is made and entered into for the sole protection and benefit of the PARTIES hereto and shall not create any rights in any third parties. No other person or entity shall have any right or action based upon the provisions of the Agreement.

16. SECTION HEADINGS.

The Section headings herein are for the convenience of the PARTIES only and shall not be deemed to govern, limit, modify or in any manner affect the scope, meaning or intent of the provisions or language of this Agreement.

17. FORMER AGREEMENTS UTILIZING COMMUNITY
DEVELOPMENT BLOCK GRANT FUNDS BETWEEN COUNTY AND CITY.

All agreements between CITY and COUNTY regarding the use of CDBG funds for fiscal years 1975-76 through fiscal years 2026-27 and any Supplemental Agreements there under, shall remain in full force and effect. If the language of this Agreement is in conflict or inconsistent with the terms of any prior said agreements between CITY and COUNTY, the language of this Agreement will be controlling.

18. INDEMNIFICATION
CITY agrees to indemnify, defend, and hold harmless COUNTY and its authorized officers, employees, agents, and volunteers from any and all claims, actions, losses, damages, and/or liability arising from CITY acts, errors or omissions and for any costs or expenses incurred by COUNTY on account of any claim therefore, except where such indemnifications is prohibited City Council Agenda,

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by law. CITY shall promptly notify COUNTY in writing of the occurrence of any such claims, actions, losses, damages, and/or liability.

CITY shall indemnify and hold harmless COUNTY against any liability, claims, losses, demands, and actions incurred by COUNTY as a result of the determination by HUD or its successor that activities undertaken by CITY under the program(s) fail to comply with any laws, regulations, or policies applicable thereto or that any funds billed by and disbursed to CITY under this Agreement were improperly expended.

19. COMPLIANCE WITH LAWS AND REGULATIONS.

By executing this Agreement, the Parties hereby certify that they will adhere to and comply with all Federal, state and local laws, regulations and ordinances.

20. ENTIRE AGREEMENT.

It is expressly agreed that this Agreement embodies the entire agreement of the Parties in relation to the subject matter hereof, and that no other agreement or understanding, verbal or otherwise, relative to this subject matter, exists between the Parties at the time of execution.

21. SEVERABILITY.

Each paragraph and provision of this Agreement is severable from each other provision and in the event any provision in this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provision will never the less continue in full force without being impaired or invalidated in any way.

22. ASSIGNMENT.

CITY shall not make any sale, assignment, conveyance or lease of any trust or power, or transfer in any other form with respect to this Agreement, or delegate or assign any interest in this Agreement without prior written approval of the County.

23. INTERPRETATION AND GOVERNING LAW.

This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. This Agreement shall be construed as a whole according to its fair language and common meaning to achieve the objectives City Council Agenda,

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and purposes of the Parties hereto, and the rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not be employed in interpreting this Agreement, all Parties having been represented by counsel in the negotiation and preparation hereof.

24. WAIVER.

Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by the other Party, or the failure by a Party to exercise its rights upon the default of the other Party, shall not constitute a waiver of such Party’s right to insist and demand strict compliance by the other Party with the terms of this Agreement thereafter.

25. JURISDICTION AND VENUE.

Any action at law or in equity arising under this Agreement or brought by a Party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed in the Superior Court of California, County of Riverside, State of California, and the Parties hereto waive all provisions of law providing for the filing, removal or change of venue to any other court or jurisdiction.

26. AMENDMENTS
No change, amendment, or modification to the Agreement shall be valid or binding upon CITY or COUNTY unless such change, amendment, or modification is in writing and duly executed. CITY and COUNTY agree to adopt any necessary amendments to this Agreement to incorporate changes required by HUD as set forth in the Urban County Qualification Notice.

Amendments must be submitted to HUD as provided in the Urban County Qualification Notice and failure to do so will void the automatic renewal for such qualification period.

27. PROHIBITION OF CDBG FUND TRANSFER
Parties to this Agreement understand and agree that they may not sell, trade, or otherwise transfer all or any portion of CDBG Part 52 funds to a Metropolitan City, Urban County, unit of general local government, or insular area that directly or indirectly receives CDBG funds in exchange for any funds, credits, or non-Federal considerations, but must use such funds for activities eligible under Title I of the Housing and Community Development Act of 1974, as amended
City Council Agenda,

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28. EMERGENCY SOLUTIONS GRANT FORMULA ALLOCATION
CITY acknowledges that while participating in the COUNTY’s Urban County program, CITY can only receive a formula Emergency Solutions Grant (ESG) allocation from the Urban County program and only at such times as authorized by the Board of Supervisors. The CITY and COUNTY may also apply for ESG funds from the State of California, if permitted by the State.

29. HOME INVESTMENT PARTNERSHIP ACT FORMULA

ALLOCATION
CITY acknowledges that while participating in the COUNTY’s Urban County program, CITY can only receive a formula HOME allocation from the Urban County program and only at such times as authorized by the Board of Supervisors. The CITY and COUNTY may also apply for HOME funds from the State of California, if permitted by the State.

30. AUTHORITY TO EXECUTE.

The persons executing this Agreement or exhibits attached hereto on behalf of the Parties to this Agreement hereby warrant and represent that they have the authority to execute this Agreement and warrant and represent that they have the authority to bind the respective Parties to this Agreement to the performance of its obligations hereunder.

31. INCORPORATION OF RECITALS
The Parties hereby affirm the facts set forth in the recitals above. Said recitals are incorporated herein and made an operative part of this Agreement.

32. COUNTERPARTS
This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute one and the same instrument. [SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the COUNTY and CITY have executed this Agreement on the date shown below.

Date: _______________________

COUNTY OF RIVERSIDE, CITY OF CANYON LAKE,
a political subdivision of the a general law city
State of California
BY: ____________________________ BY: _________________________ Heidi Marshall, Director Mayor or City Manager
Housing and Workforce Solutions
APPROVED AS TO FORM: ATTEST:

Minh C. Tran,
County Counsel
BY: ________________________
By: __________________________________ City Clerk
Braden Holly
Deputy County Counsel

APPROVED AS TO FORM:

BY: __________________________
City Attorney
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COUNTY COUNSEL CERTIFICATION
The Office of County Counsel of the County of Riverside hereby certifies that the terms and provisions of this Agreement are fully authorized under state and local law and that the Agreement provides full legal authority for the COUNTY to undertake, or assist in undertaking, essential community development and housing assistance activities specifically urban renewal and publicly assisted housing.

County Counsel
By: ____
Deputy County Counsel, Braden Holly
City Council Agenda,

ITEM NO. 11

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Sheryl Garcia, Assistant City Manager/City Clerk
DATE: 08/05/2026
SUBJECT: Consideration of a Resolution Adopting the City's Amended Conflict of Interest Code Recommendation:

Adopt Resolution No. 2026-38 rescinding Resolution No. 2024-39 and adopting the City's amended Conflict of Interest Code.

Background/Analysis:

Pursuant to the Political Reform Act (Act), every government agency must adopt a Conflict of Interest Code (COI Code) identifying positions required to file Statements of Economic Interests (FPPC Form 700) and specifying their disclosure requirements. The COI Code must identify positions within the City that make or participate in making governmental decisions that may affect their financial interests.

The Act requires agencies to review their COI Code in even-numbered years and update it as necessary to reflect changes in positions and responsibilities.

The City last adopted its COI Code on September 3, 2024. The proposed amendments update the designated positions to align the Conflict of Interest Code with the City's current organizational structure and the positions authorized in the City's adopted budget.

Approval of the amended COI Code ensures continued compliance with the Political Reform Act and maintains transparency in governmental decision-making.

Fiscal Impact Yes/No:No
Attachments:
1 - Resolution
City Council Agenda,

RESOLUTION NO. 2026-38

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CANYON LAKE, CALIFORNIA, RESCINDING RESOLUTION NO. 2024-39 AND ADOPTING AN AMENDED

CONFLICT OF INTEREST CODE CONTAINING REVISED DESIGNATED POSITIONS

AND DISCLOSURE CATEGORIES
WHEREAS, the Political Reform Act of 1974, California Government Code Section 81000, et seq., requires every state and local government agency to adopt and promulgate a Conflict of Interest Code (Government Code section 87300) and requires local agencies to review its conflict of interest code at least every even-numbered year; and
WHEREAS, a designated employee is anyone within the City of Canyon Lake who is an officer, employee, board, commission, committee member, or consultant who is designated in the Code because the position entails the making or participation in the making of decisions which may foreseeably have a material effect on any financial interest (Government Code section 82019) including “Acting” and “Interim” position designations;
WHEREAS, the term “designated employee” does not include public officials specified in Government Code section 87200, e.g. city council members, planning commissioners, city managers, city attorneys, city treasurers, etc., who are already required by law to file Statements of Economic Interests, nor does it include a position which is solely clerical, ministerial, or manual; and WHEREAS, on September 3, 2024, the City Council adopted Resolution No. 2024-39, which provided a single conflict of interest code for officials and designated employees of the City in compliance with the Act, which now needs to be rescinded; and
WHEREAS, pursuant to the provisions of Government Code section 87306.5, the City has conducted its required biennial review of the conflict of interest code and is proposing the conflict of interest code set forth in Exhibit “A”, attached hereto and incorporated herein by reference.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CANYON LAKE DOES RESOLVE AS FOLLOWS:

Section 1. The above recitals are true and correct and are incorporated herein by reference.

Section 2. Resolution No. 2024-39 is hereby rescinded, and all previously adopted conflict of interest codes are hereby superseded and of no further force and effect.

Section 3. The City Council hereby adopts the Conflict of Interest Code attached hereto as Exhibit “A” and incorporated herein by this reference.

Section 4. The provisions of this Resolution are severable and if any provision, clause, sentence, word or part thereof is held illegal, invalid, unconstitutional, or inapplicable to any person or circumstances, such illegality, invalidity, unconstitutionality, or inapplicability shall not affect or impair any of the remaining provisions, clauses, sentences, sections, words or parts thereof of the Resolution or their applicability to other persons or circumstances.

City Council Agenda,

Section 5. That the City Clerk shall certify to the adoption of this Resolution and that the same shall be in full force and effect.

Section 6. This Resolution shall take effect immediately upon its adoption.

PASSED, APPROVED AND ADOPTED this 5th day of August 2026, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________
Jeremy Smith, Mayor
ATTEST & CERTIFIED:

I, Sheryl Garcia, City Clerk of the City of Canyon Lake, hereby attest to the mayor’s signature above and certify that the City Council duly adopted this Resolution as recorded in the vote tally stated herein.
_________________________
Sheryl L. Garcia, MMC, CPM
City Clerk
City Council Agenda,

EXHIBIT “A”

CITY OF CANYON LAKE CONFLICT OF INTEREST CODE
The Political Reform Act (Government Code section 81000, et seq.) requires state and local government agencies to adopt and promulgate conflict of interest codes. The Fair Political Practices Commission has adopted a regulation (2 California Code of Regulations Section 18730) that contains the terms of a standard conflict of interest code, which can be incorporated by reference in an agency’s code.

After public notice and hearing, the standard code may be amended by the Fair Political Practices Commission to conform to amendments in the Political Reform Act. Therefore, the terms of 2 California Code of Regulations Section 18730 and any amendments to it duly adopted by the Fair Political Practices Commission are hereby incorporated by reference. This regulation and the attached Exhibit “A” designating positions and establishing disclosure categories, shall constitute the conflict of interest code of the City of Canyon Lake.

Individuals holding designated positions shall file their Statements of Economic Interest (“Form 700”) with the Canyon Lake City Clerk who will make the statements available for public inspection and reproduction pursuant to Government Code section 81008. For those positions listed in Government Code section 87200, filings must be electronically filed directly with the Fair Political Practices Commission.

City Council Agenda,

DESIGNATED POSITIONS
The City requires full disclosure under “Category 1” for the positions listed below which participate in making decisions which may foreseeably have a material effect on financial interests. Category 1 means disclosure of all investments and business positions in, and sources of income from, business entities that do business or own real property within jurisdiction of the City, plan to do business or own real property within the jurisdiction of the City within the next year or have done business or owned real property within the jurisdiction of the City within the past two (2) years.

City Council Members, the City Manager, the City Attorney, the City Treasurer and all other City officials who manage public investments, as defined by 2 Cal. Code of Regulations Section 18701(b), are not subject to the City’s Conflict of Interest Code but are subject to the disclosure requirements of the Political Reform Act (Government Code section 87200 et seq.). Those officials are listed below.

GOVERNMENT CODE SECTION 87200 FILERS

DESIGNATED POSITION DISCLOSURE CATEGORY
City Council Members (5) 1
City Manager 1
City Treasurer 1
City Attorney 1
Finance Director 1

CITY OF CANYON LAKE EMPLOYEES AND CONSULTANTS

DESIGNATED POSITION DISCLOSURE CATEGORY
Administrative Services Senior Analyst 1
Assistant City Manager/City Clerk 1
Building Official/Senior Building Inspector 1
Community Development Manager 1
Facilities Maintenance & Building Inspector 1
Fire Chief 1
Fire Battalion Chief 1
Police Chief 1
Police Captain 1
Consultants (consultants who will make or
participate in governmental decisions on
behalf of the City)
1 City Council Agenda,

CONSULTANT DESCRIPTION
Consultants shall be included in the list of designated employees and shall disclose pursuant to the broadest disclosure category in the code subject to the following limitation: The City Manager may determine in writing that a particular consultant, although a “designated position,” is hired to perform a range of duties that is limited in scope and thus is not required to fully comply with the disclosure requirements described herein. Such written determination must include a description of the consultant’s duties and, based upon the description, a statement of the extent of disclosure requirements.

The City Manager’s determination is a public record and must be retained for public inspection in the same manner and location as this Conflict of Interest Code. (Gov. Code section 81008.) Consultants for the purposes of the Conflict of Interest Code, include the following:
(Regulations of the Fair Political Practices Commission, Title 2, Division 6, California Code of Regulations)
§ 18700.3. Consultant, Public Official Who Manages Public Investments: Definitions. (a) For purposes of Sections 82019 and 82048, “consultant” means an individual who, pursuant to a contract with a state or local government agency:
(1) Makes a governmental decision whether to:
(A) Approve a rate, rule, or regulation;
(B) Adopt or enforce a law;
(C) Issue, deny, suspend, or revoke any permit, license, application, certificate, approval, order, or similar authorization or entitlement; (D) Authorize the agency to enter into, modify, or renew a contract provided it is the type of contract that requires agency approval;
(E) Grant agency approval to a contract that requires agency approval and to which the agency is a party, or to the specifications for such a contract; (F) Grant agency approval to a plan, design, report, study, or similar item; (G) Adopt, or grant agency approval of, policies, standards, or guidelines for the agency, or for any subdivision thereof; or
(2) Serves in a staff capacity with the agency and in that capacity participates in making a governmental decision as defined in Regulation 18704(a) and (b) or performs the same or substantially all the same duties for the agency that would otherwise be performed by an individual holding a position specified in the agency's Conflict of Interest Code under Section 87302.

City Council Agenda,

(b) For purposes of Section 87200, the following definitions apply:
(1) “Other public officials who manage public investments” means:
(A) Members of boards and commissions, including pension and retirement boards or commissions, or of committees thereof, who exercise responsibility for the management of public investments;
(B) High-level officers and employees of public agencies who exercise primary responsibility for the management of public investments, such as chief or principal investment officers or chief financial managers. This category shall not include officers and employees who work under the supervision of the chief or principal investment officers or the chief financial managers; and (C) Individuals who, pursuant to a contract with a state or local government agency, perform the same or substantially all the same functions that would otherwise be performed by the public officials described in subdivision (b)(1)(B). (c) “Public investments” means the investment of public moneys in real estate, securities, or other economic interests for the production of revenue or other financial return. (d) “Public moneys” means all moneys belonging to, received by, or held by, the state, or any city, county, town, district, or public agency therein, or by an officer thereof acting in the officer's official capacity, and includes the proceeds of all bonds and other evidences of indebtedness, trust funds held by public pension and retirement systems, deferred compensation funds held for investment by public agencies, and public moneys held by a financial institution under a trust indenture to which a public agency is a party.
(e) “Management of public investments” means the following nonministerial functions:
directing the investment of public moneys; formulating or approving investment policies; approving or establishing guidelines for asset allocations; or approving investment transactions.

City Council Agenda,

ITEM NO. 12

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and Members of the City Council
FROM: Arron Brown, City Manager
BY: Brianna Hemsley, Executive Assistant to the City Manager DATE: 08/05/2026
SUBJECT: Consideration of a Professional Services Agreement with Animal Friends of the Valleys, Inc. for Animal Control Services
Recommendation:

Approve a Professional Services Agreement with Animal Friends of the Valleys, Inc. for animal control services in an amount not to exceed $43,050 annually and authorize the City Manager to execute the Agreement on a form acceptable to the City Attorney.

Background/Analysis:

The City of Canyon Lake has contracted with Animal Friends of the Valleys, Inc. (SFV) for animal control services. These services are meant to safeguard the health and safety of its citizens and domestic animals through field services, after-hours emergency response, humane animal treatment, and enforcement of the City's related animal control municipal codes. The City is responsible for providing animal control and sheltering services to its residents, either directly or through contractual agreements. Since incorporation in 1990, the City has contracted with AFV for animal control services and, beginning in 2004, for animal sheltering services under separate agreements. Animal sheltering services are provided through an agreement with the Southwest Communities Financing Authority (SCFA), administered by Riverside County on behalf of the City and neighboring jurisdictions.

At the November 8, 2023 City Council meeting Council approved a new long-term agreement that maintained existing service levels while incorporating several administrative and financial updates.

The agreement included a 2.5 percent annual cost-of-living adjustment, increased boarding fees to better reflect sheltering costs, and revisions to the Canyon Lake Municipal Code related to animals running at large. The agreement was approved for a three-year term through June 30, 2026, with two optional one-year extensions.

Since the initial three-year term has expired, rather than exercising one of the optional one-year extensions, staff is recommending approval of a new three-year Professional Services Agreement with Animal Friends of the Valleys, Inc. This approach provides the opportunity to comprehensively review and update both the agreement and the Scope of Services to ensure they accurately reflect the City's current operational needs and service expectations. As a result of this review, revisions were made to improve clarity, correct inconsistencies, strengthen performance and reporting requirements, and incorporate additional operational standards. The most significant updates include:

Clarified and standardized operational, administrative, and financial provisions throughout the agreement.

Added new operational standards for statutory holding periods, shelter standards of care, microchipping, monthly performance reporting, City ownership of animal management data, City Council Agenda,

disaster response planning, and end-of-term transition assistance.

The proposed agreement is for a three-year term, through June 30, 2029, with the option of two (2) one-year extensions, for a maximum term of five years. The proposed agreement provides the City with cost certainty by maintaining the current compensation rate of $3,587.50 per month, not to exceed $43,050 annually, for the initial three-year term.

Fiscal Impact Yes/No:Yes
Additional Fiscal Information:

Costs to cover the annual not-to-exceed amount of $43,050 are included in the adopted FY 2026-27 budget, account no. 430-6610.

City Council Agenda,