Agenda packet — Foster City City Council, June 20, 2023 (part 2 of 4)

24 82 3.00
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Allsteel Inc.
801132P--$(A)-.LC-928-$(P1)-.P02
ELL CONN KIT 32H LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
226.00 50.62 151.86
83 3.00
Each
Allsteel Inc.
801169P--$(A)-.LC-928-$(P1)-.P02
ELL CONN KIT 69H LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
273.00 61.15 183.45
84 3.00
Each
Allsteel Inc.
801269P--$(A)-.LC-928-$(P1)-.P02
TEE CONN KIT 69H LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
435.00 97.44 292.32
85 2.00
Each
Allsteel Inc.
801369P--$(A)-.LC-928-$(P1)-.P02
CROSS CONN KIT 69H LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
435.00 97.44 194.88
86 3.00
Each
Allsteel Inc.
801443P--$(A)-.LC-928-$(P1)-.P02
PANEL END COVER-FABRIC 43H LOW PROFILE PAINTED
150.00 33.60 100.80

6.5 Attachment 2 - Agreement

148

Proposal
Sam Clar Office Furniture
An Insidesource Company
1221 Diamond Way
Concord, CA 94520
https://samclar.com/
Order Number 4718
Order Name Concensys project/Laura
office
Date 06/14/2023
Customer PO No
Contract Number
Customer Name Foster City
Salesperson Dan Peters
Project Number
Project Name
Terms NET 30

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24 $(A):Grd A FAB
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% Off List: 77.60
87 8.00
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Allsteel Inc.
801469P--$(A)-.LC-928-$(P1)-.P02
PANEL END COVER-FABRIC 69H LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
160.00 35.84 286.72
88 4.00
Each
Allsteel Inc.
801543P--$(A)-.LC-928-$(P1)-.P02
PANEL MOUNT TO WALL KIT 43H LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-3 New Layout
% Off List: 77.60
327.00 73.25 293.00
89 3.00
Each
Allsteel Inc.
893224P--$(A)-.LC-928-$(P1)-.P02
ACOUSTICAL PANEL 32H X 24W LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
757.00 169.57 508.71
90 3.00
Each
Allsteel Inc.
893242P--$(A)-.LC-928-$(P1)-.P02
ACOUSTICAL PANEL 32H X 42W LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
942.00 211.01 633.03

6.5 Attachment 2 - Agreement

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24 $(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-2 New Layout
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91 3.00
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Allsteel Inc.
894348P--$(A)-.LC-928-$(P1)-.P02
ACOUSTICAL PANEL 43H X 48W LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
1,156.00 258.94 776.82
92 3.00
Each
Allsteel Inc.
896942P--$(A)-.LC-928-$(P1)-.P02
ACOUSTICAL PANEL 69H X 42W LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-2 New Layout
% Off List: 77.60
1,312.00 293.89 881.67
93 3.00
Each
Allsteel Inc.
896942P--$(A)-.LC-928-$(P1)-.P02
ACOUSTICAL PANEL 69H X 42W LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-3 New Layout
% Off List: 77.60
1,312.00 293.89 881.67
94 3.00
Each
Allsteel Inc.
896948P--$(A)-.LC-928-$(P1)-.P02
ACOUSTICAL PANEL 69H X 48W LOW PROFILE PAINTED
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
1,394.00 312.26 936.78

6.5 Attachment 2 - Agreement

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Page 20 ends

24 % Off List: 77.60
95 8.00
Each
Allsteel Inc.

A871248--.P
POWER HARNESS 48W
.P:Black
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
403.00 90.27 722.16
96 3.00
Each
Allsteel Inc.

A871260--.P
POWER HARNESS 60W
.P:Black
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
403.00 90.27 270.81
97 4.00
Each
Allsteel Inc.

A871224--.P
POWER HARNESS 24W
.P:Black
Tag: Tag TG: Floor-2 New Layout
% Off List: 77.60
379.00 84.90 339.60
98 4.00
Each
Allsteel Inc.

A871230--.P
POWER HARNESS 30W
.P:Black
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
379.00 84.90 339.60
99 8.00
Each
Allsteel Inc.

A871236--.P
POWER HARNESS 36W
.P:Black
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
379.00 84.90 679.20
100 8.00
Each
Allsteel Inc.

A871242--.P
POWER HARNESS 42W
.P:Black
Tag: Tag TG: Floor-3 New Layout
% Off List: 77.60
403.00 90.27 722.16
101 8.00
Each
Allsteel Inc.

A871248--.P
403.00 90.27 722.16

6.5 Attachment 2 - Agreement

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Page 21 ends

24 POWER HARNESS 48W
.P:Black
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
102 8.00
Each
Allsteel Inc.

A871501--.E9
DUPLEX RECEPT CIRCUIT 1 3+1 OR 2+2 SYSTEM
.E9:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.59

69.00 15.46 123.68
103 8.00
Each
Allsteel Inc.

A871502--.E9
DUPLEX RECEPT CIRCUIT 2 3+1 OR 2+2 SYSTEM
.E9:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.59

69.00 15.46 123.68
104 8.00
Each
Allsteel Inc.

A871503--.E9
DUPLEX RECEPT CIRCUIT 3 3+1 OR 2+2 SYSTEM
.E9:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.59

69.00 15.46 123.68
105 8.00
Each
Allsteel Inc.

A871504--.E9
DUPLEX RECEPT CIRCUIT 4 3+1 OR 2+2 SYSTEM
.E9:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.59

69.00 15.46 123.68
106 4.00
Each
Allsteel Inc.

A879072--.P
SIDE POWER IN-FEED CABLE 3+1 & 2+2 SYSTEMS
.P:Black
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
426.00 95.42 381.68
107 10.00
Each
Allsteel Inc.

CCB24L--$(P1)-.P02
CANTILEVER BKT 24D LH CONCENSYS
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout

81.00 18.14 181.40

6.5 Attachment 2 - Agreement

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24 % Off List: 77.60
108 10.00
Each
Allsteel Inc.

CCB24R--$(P1)-.P02
CANTILEVER BKT 24D RH CONCENSYS
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60

81.00 18.14 181.40
109 4.00
Each
Allsteel Inc.

CVH13PF--$(A)-.LC-928-$(P1)-.P02
VARIABLE HGT 13H LOW PROFILE FABRIC
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
221.00 49.50 198.00
110 4.00
Each
Allsteel Inc.

CVH26PF--$(A)-.LC-928-$(P1)-.P02
VARIABLE HGT 26H LOW PROFILE FABRIC
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-3 New Layout
% Off List: 77.60
229.00 51.30 205.20
111 4.00
Each
Allsteel Inc.

CVH37PF--$(A)-.LC-928-$(P1)-.P02
VARIABLE HGT 37H LOW PROFILE FABRIC
$(A):Grd A FAB
.LC:Lucy
928:Snowdrop
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: Floor-1 New Layout
% Off List: 77.60
239.00 53.54 214.16
112 6.00
Each
Allsteel Inc.

APMC6--.P
COAT HOOK (PACKAGE OF 6)
.P:Black
128.00 28.67 172.02

6.5 Attachment 2 - Agreement

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24 % Off List: 77.60
114 1.00
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Allsteel Inc.

Z6CLFR--$(P1)-.P02

FIXED C-LEG RIGHT FOR FLAT/SQ EDGE
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: parts needed for office
% Off List: 75.60
584.00 142.50 142.50
115 1.00
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Allsteel Inc.

TT629SC--$(P1)-.P02
SUP COLUMN 29-1/2HX3 DIA.
$(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: parts needed for office
% Off List: 77.60
249.00 55.78 55.78
116 1.00
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Allsteel Inc.

T624FB
FLAT BRACKET 24D
Tag: Tag TG: parts needed for office
% Off List: 77.60

77.00 17.25 17.25
117 1.00
Each
Allsteel Inc.

T53072BN--$(L1STD)-.LWD-.E9
PENINSULA 30WX72L FLAT EG LAM W/O GROM
$(L1STD):Grd L1 Standard Laminates
.LWD:Natural Maple
.E9:Flint
Tag: Tag TG: parts needed for office
% Off List: 77.60
1,260.00 282.24 282.24
118 1.00
Each
Allsteel Inc.

T53060S--$(L1STD)-.LWD-.E9-.P
PRIMARY 30DX60W FLAT EG LAM W/GROMMETS
$(L1STD):Grd L1 Standard Laminates
.LWD:Natural Maple
.E9:Flint
.P:Plastic Grommet
Tag: Tag TG: parts needed for office
% Off List: 77.60
764.00 171.14 171.14
119 1.00
Each
Allsteel Inc.

CDG--$(P1)-.P02
GUSSETS (1 PR)
171.00 38.30 38.30

6.5 Attachment 2 - Agreement

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24 $(P1):P1 Paint Opts
.P02:Flint
Tag: Tag TG: parts needed for office
% Off List: 77.60
Order Sub-Total : $83,487.34

9.3750%-FOSTER CITY-94404-2222-SAN MATEO : $7,827.04
TOTAL ORDER : $91,314.38
Balance Due : $91,314.38
PLEASE REVIEW THIS PROPOSAL AND ALL ASSOCIATED ATTACHEMENTS CAREFULLY.

Your signature below confirms that all products, finishes, and plans, associated with this proposal are correct and approved by you for purchase. You acknowledge that all products are SPECIAL ORDER and cannot be canceled or returned once production has commenced. Payment terms including required deposits, and finance charges for late fees, are governed by either a fully executed Sam Clar Terms & Condition of Sale Agreement, or by mutually approved Purchase Contract. In the absence of approved Agreement or Contract, pre-payment in full is due at time of order acceptance. A 3% processing fee is added to orders paid by credit card. This proposal is valid for 30 business days.

ACCEPTED BY: Buyer
__________________________________
Signature
By: ______________________________
Its: ______________________________
__________________________________
Date

6.5 Attachment 2 - Agreement

155

15 Updated 1/10/2022

EXHIBIT C

INSURANCE

VENDOR shall provide, in addition to the Certificates of Insurance , original Endorsement affecting the coverages specified in herein on the attached form. No substitute form will be accepted.

This is an Exhibit to, and made a part of and incorporated by reference to the Agreement dated June 20, 2023, by and between Samclar, Inc. , hereinafter referred to as " Vendor”, and the City of Foster City , hereinafter referred to as "City", providing for professional services.

1. Vendor's Duty to Show P roof of Insurance. Vendor, in order to protect City and its Council members, officials, agents, officers, and employees against all claims and liability for death, injury, loss and damage as a result of Vendor 's acts, errors, or omissions in connection with t he per formance of Vendor's obligations, as required in this Agreement, shall secure and maintain insurance as described below. Vendor shall not perform any work under this Agreement until Vendor has obtained all insurance required under this section and the required certificates of insurance and all required endorsements have been filed with the City 's authorized insurance representative, insurance Tracking Services Inc. (ITS).

Receipt of evidence of insurance that does not comply with all applicabl e insurance requirements shall not constitute a waiver of the insurance requirements set forth herein. The required documents must be signed by the authorized representative of the insurance company shown on the certificate. Upon request, Vendor shall su pply p roof that such person is an authorized representative thereof, and is authorized to bind the named underwriter(s) and their company to the coverage, limits and termination provisions shown thereon, Vendor shall promptly deliver to ITS a certificate of insurance, and all required endorsements, with respect to each renewal policy, as necessary to demonstrate the maintenance of the required insurance coverage for the term specified herein. Such certificates and endorsements shall be delivered to ITS pri or to the ex piration date of any policy and bear a notation evidencing payment of the premium thereof if so requested. Vendor shall immediately pay any deductibles and self -insured retentions under all required insurance policies upon the submission of any claim by Vendor or City as an additional insured.

1.1 Insurance Requirements

Commercial General Liability Insurance

Commercial General Liability Insurance including, but not limited to, Contractual Liability Insurance (specifically concerning the indemni ty provisions of this Agreement with the City ), Products-Completed Operations Hazard, liability for slander, false arrest and invasion of privacy arising out of professional services rendered hereunder, Personal Injury (including bodily injury and death), and P roperty Damage for liabil ity arising out of Vendor's performance of services under this Agreement. The Commercial General Liability insurance shall contain no exclusions or limitation for independent contractors working on the behalf of the named ins ured. Vendor shall maintain t he Products -Completed Operations Hazard coverage for the longest period allowed by law following termination of this Agreement. The amount of said insurance coverage required by this Agreement shall be the policy limits, which sha ll be at lea st two million dollars ($2 ,000,000) each occurrence and two million dollars ($2,000,000) aggregate.

*Please note, the City will require a separate additional insured endorsement for the Commercial General Liability policy, listing the “C ity o f Fost er Cit y, its Council members, officials, agents, officers, and employees”.

☒ Business Automobile Liability Insurance

Automobile Liability Insurance against claims of Personal Injury (including bodily injury and death) and Propert y Damage covering any vehicle and/or all owned, leased, hired and non-

6.5 Attachment 2 - Agreement

156

16 Updated 1/18/2022

owned vehicles used in the performance of Services pursuant to this Agreement with coverage equal to the policy limits, which shall be at least two million dollars ($2,0 00,000) each occurrence.

☒ Workers' Compensation Insurance

VENDOR shall submit written pr oof that VENDOR is insured against liability for workers' compensation in accordance with the provisions of section 3700 of the California Labor Code.

VENDOR shall require any Sub contractors to provide workers' compensation for all of the Subcontractors' employees, unless the Subcontractor s' employees are covered by the insurance afforded by VENDOR. If any class of employees engaged in work or services performed under this Agreement is n ot covered by California Labor Code section 3700, VENDOR shall provide and/or require each Subcontractor to provide adequate insurance for the coverage of employees not otherwise covered. Vendor shall also maintain employer's liability insurance with limits of one million dollars ($1,000,000) for bodily injury or disease.

☒ Professional Liability Insurance

Professional Liability (Errors and Omissions) Insurance, for liability arising out of, or in connection with, all negligent acts, errors or omissions in connection with services to be provided under this Agreement, with no exclusion for claims of one insured against another insured, with coverage equal to the policy limits, which shall not be less than five million dollars ($5,000,000) per occurrence and five million dollars ($5,000,000) aggregate.

☒ Installation Floater

Installation Floater, covering the work performed under this Contract, against all risks of direct physical loss. The policy shall cover the Contractor’s labor, materials and equipment, including materials and equipment in transit or away from the project site, to be installed in the existing structure(s). The coverage shall be written for an amount equal to the initial contract amount plus the value of any subsequent change orders, subject to a deductible of not more than [$10,000] payable by Contractor.

☒ Cyber Liability Insurance

Cyber Liability Insurance, covering network risk and cyber liability (including coverage for unauthorized access, failure of security, breach of privacy perils, as well at notification costs and regulatory defense) in an amount of not less than $1,000,000. Such insurance shall be maintained in force at all times during the term of the Contract and for a period of two years thereafter for services completed during the term of the Contract.

1.2 Self-Insured Retention

Any self -insured retentions in excess of $100,000 must be declared on the Certificate of insurance or other documentation provided to City and must be approved by the City Risk Manager.

1.3 Claims-Made Basis Coverage

If any of the insurance coverages required under this Agreement is written on a claims -made basis,
Vendor, at Vendor's option, shall either (i) maintain said coverage for at least five (5) years following the termination of this Agreement with coverage extending back to the effective date of this Agreement; (ii) purchase an extended reporting period of not less than five (5) years following

6.5 Attachment 2 - Agreement

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17 Updated 1/18/2022

the termination of this Agreement; or (iii) acquire a full prior acts provision on any renewal or replacement policy.

2. City as Additional Insured

On Vendor's Commercial General Liability and Automobile policies, the City, its Council members, officers, directors, agents, employees, and volunteers, shall be named as additional insured's, but only with respect to liability arising out of the activities of the named insured. Any endorsement shall be provided using one of the following three options: (i) on ISO form CG 20 10 1 1 85; or (ii) on ISO form CG 20 37 10 01 plus either ISO form CG 20 10 10 01 or CG 20 33 10 01; or (iii) on such other forms which provide coverage at least equal to or better than form CG 20 10 1 1 85.

3. Insurance terms and conditions:

3.1 Cancellation of Insurance

The above stated insurance coverages required to be maintained by Vendor shall be maintained until the completion of all of Vendor 's obligations under this Agreement except as otherwise indicated herein. Each insurance policy supplied by Vendor shall not be suspended, voided, cancelled or reduced in coverage or in limits except after ten (10) days written notice by Vendor in the case of non- payment of premiums, or thirty (30) days written notice in all other cases. This notice requirement does not waive the insurance requirements stated herein. Vendor shall immediately obtain replacement coverage for any insurance policy that is terminated, c anceled, non-renewed, or whose policy limits have been exhausted or upon insolvency of the insurer that issued the policy.

3.2 All insurance shall be issued by a company or companies admitted to do business in California and listed in the current "Best's Key Rating Guide" publication with a minimum rating of A-; VII Any exception to these requirements must be approved by the City Risk Manager.

3.3 If Vendor is, or becomes during the term of this Agreement, self-insured or a member of a self-insurance pool, Vend or shall provide coverage equivalent to the insurance coverages and endorsements required above. The City will not accept such coverage unless the City determines, in its sole discretion and by written acceptance, that the coverage proposed t o be provided by Vendor is equivalent to the above-required coverages.

3.4 For any claims related to the Agreement, the Vendor’s insurance coverage shall be primary insurance coverage at least as broad as ISO CG 20 01 04 13 as respects the City , its officers, officials, employees, and volunteers. Any insurance or self -insurance maintained by the City , its officers, officials, employees, or volunteers shall be excess of the Vendor’s insurance and shall not contribute with it.

3.5 Insurance coverages in the minimum amounts set forth herein shall not be construed to relieve Vendor for any liability, whether within, outside, or in excess of such coverage, and regardless of solvency or insolvency of the insurer that issues the coverage; nor shall it preclude the City from taking such other actions as are available to it under any other provision of this Agreement or otherwise in law.

3.6 Failure by Vendor to maintain all such insurance in effect at all times required by this Agreement shall be a material breach of this Agreement by Vendor. City , at its sole option, may terminate this Agreement and obtain damages from Vendor resulting from said breach.

Alternatively, City may purchase such required insurance coverage, and without further notice to Vendor, City shall deduct from sums due to Vendor any premiums and associated costs

6.5 Attachment 2 - Agreement

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18 Updated 1/18/2022

advanced or paid by City for such insurance. If the balance of monies obligated to Vendor pursuant to this Agreement are insufficient to reimburse City for the premiums and any associated costs, Vendor agrees to reimburse City for the premiums and pay for all costs associated with the purchase of said insurance. Any failure by City to take this alternative action shall not relieve Vendor of its obligation to obtain and maintain the insurance cover ages required by this Agreement.

3.7 Should any of the required insurance (other than errors and omissions insurance) be provided under a form of coverage that includes a general annual aggregate limit or provides that claims investigation or legal defenses c osts be included in such general aggregate limit, such general annual aggregate limit shall be double the occurrence or claims limit specified abov e.

3.8 City may (but is under no obligation to) secure project -specific insurance, wrap- up insurance, or administer an owner controlled insurance program ("OCIP"), in which case Vendor and its subcontractors shall communicate this fact to their insurance car riers and request that the risk of this project be excluded from their practice policies. Vendor's fees under this Agreement (and the fee of its subcontractor s under subcontractor agreements) shall be reduced by the amount of insurance premiums that may be avoided by Vendor and its subcontractors by virtue of the City's obtaining the project -specific insurance, wrap-up insurance or administering an OCIP, and the exclusion of this project from coverage of Vendor 's and subcontractor s policies.

Construction
Manager and its subcontractor s shall afford City access to their books and records and cooperate with City in verifying the amount of savings realized.

ATTACHED

1. Insurance Coverage Form

6.5 Attachment 2 - Agreement

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19 Updated 1/18/2022

EXHIBIT C
This INSURANCE COVERAGE FORM modifies or documents insurance provided under the following:

Named Insured: Effective Work Date(s):

Description of Work/Locations/Vehicles:

ADDITIONAL INSURED: City of Foster City/Estero Municipal Improvement District (CITY) 610 Foster City Boulevard, Foster City, CA 94404
Attention: _________________________________
Contract Administrator
Endorsement and Certificates of Insurance Required
The Additional Insured, its elected or appointed officers, officials, employees and volunteers are included as insureds with regard to damages and defense of claims arising from: (Check all that apply)
Insurer Policy
No.

General Liability : (a) activities performed by or on behalf of the Named Insured, (b) products and completed operations of the Named Insured, (c) premises owned, leased occupied or used by the Named Insured, and/or (d) permits issued for opera
tions performed by the Named Insured. {Note:

MEETS OR EXCEEDS ISO Form # CG 20 10 11 85}

Auto Liability : the ownership, oper ation, maintenance, use, loading or unloading of any auto owned, leased, hired or borrowed by the Named Insured, regardless of whether liability is attributable to the Named Insured or a combination of the Named Insured and the Additional Insured, its elec ted or appointed officers, officials, employees or volunteers.

Other: [Cyber Liability, Installation Floater, etc.]
Certificates of Insurance Required (no endorsement needed) (Check all that apply) Insurer Policy No.

Workers Compensation : work performed by employees of the Named Insured while those employees are engaged in work under the simultaneous directions and control of the Named Insured and the Additional Insured.

Professional Liability:

PRIMARY/NON-CONTRIBUTORY: This insurance is primary and is not additional to or contributing with any other insurance carried by or for the benefit of Additional Insureds.

SEVERABILITY OF INTEREST: The insurance afforded by this policy applies separately to each insured who is seeking coverage or against whom a claim is made or a suit is brought, except with respect to the insurer’s limit of liability.

PROVISIONS REGARDING THE INSURED'S DUTIES AFTER ACCIDENT OR LOSS : Any failure to comply with reporting provisions of the policy shall not affect coverage provided to the Additional Insured, its elected or appointed officers, officials, employees, or volunteers.

CANCELLATION NOTICE. The insurance afforded by this policy shall not be suspended, voided, canceled, reduced in coverage or in limits except after thirty (30) days' prior written notice (ten (10) d ays if canceled due to non-payment) by regular mail return receipt requested has been given to the Additional Insured. Such notice shall be addressed as shown above.

WAIVER OF SUBROGATION: The insurer(s) named above agree to waive all rights of subrogati on against the CITY, its elected or appointed officers, officials, agents, volunteers and employees for losses paid under the terms of this policy which arise from work performed by the Named Insured for the CITY.

Nothing herein contained shall vary, alter or extend any provision or condition of the Policy other than as above stated.

SIGNATURE OF INSURER OR AUTHORIZED REPRESENTATIVE OF THE INSURER

I, ___________________________________________________________(print/type name), warrant that I have authority to bind the above-named insurance company and by my signature hereon do so bind this company.

SIGNATURE OF AUTHORIZED REPRESENTATIVE (original signature required)

ORGANIZATION: TITLE:

ADDRESS:

TELEPHONE: ( ) DATE ISSUED:

6.5 Attachment 2 - Agreement

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EXHIBIT D

COVID-19 AMENDMENT/ATTACHMENT
(Vendor Agreement Form)

This COVID-19 Amendment/Attachment amends the Agreement between the City of Foster City (“City”) and Samclar Inc. (“Vendor”) dated June 20, 2023.

1. Definitions
A. The 2019 novel coronavirus and the disease it causes are collectively referred to herein as “COVID-19”.

B. A “COVID-19 Condition” is something attributable to COVID-19 not caused by the Vendor (which for purposes herein includes all subcontractors) and beyond its reasonable control including but not limited to COVID-19 Proclamations and supply chain disruptions due to COVID-19, and other circumstances concerning COVID-19 not caused by the Vendor and which are beyond its reasonable control.

C. A “COVID-19 Proclamation” includes but is not limited to orders, directives and guidance concerning COVID-19 that have been issued, and which may be issued from time to time, by public agencies or regulatory bodies, the CDC or OSHA or Cal/OSHA, including without limitation the Cal/OSHA COVID-19 Prevention Emergency Temporary Standards. Vendor acknowledges that those orders, directives and guidance may require the Project to shut down or otherwise increase the Vendor’s cost or time of performance by calling for things such as social distancing and the use of personal protective equipment. In the event of conflicting COVID-19 Proclamations, the Vendor shall follow the most applicable, restrictive and newest COVID-19 Proclamations.

D. An “Unknown COVID-19 Condition” is a COVID-19 Condition the Vendor did not know about, and reasonably should not have known about, as of the date the Vendor submitted its proposal. The requirements contained in COVID-19 Proclamations issued before submission of a proposal are not Unknown COVID-19 Conditions, and the Vendor will be deemed to have knowledge of those requirements.

E. An “Unknown COVID-19 Cost” is a cost that: (i) is solely attributable to an Unknown COVID-19 Condition; (ii) is reasonable and unavoidable under the circumstances; (iii) is not the result of the Vendor’s failure to comply with the contract documents or a COVID-19 Proclamation; and (iv) is not the result of a subcontractors failure to comply with a COVID-19 Proclamation in connection with the performance of the Services.

2. COVID-19 Conditions and Proposal. Vendor is expected to know and is deemed to have known about COVID-19 Conditions when it submits its proposal, and COVID-19 Conditions must be accounted for in the Vendor’s price and schedule. In order to be

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entitled to any relief from a COVID-19 Condition, the Vendor must demonstrate that the issue, cost or delay is due to an Unknown COVID-19 Condition.

3. Compliance with COVID-19 Proclamations.

A. Vendor shall comply with COVID-19 Proclamations in the performance of the Services, irrespective of when the COVID-19 Proclamations are issued, and as they pertains to performance of the Services. The cost of such compliance is non- compensable, except as otherwise expressly stated herein.

B. Vendor is responsible to ensure that its subcontractors and suppliers comply with COVID-19 Proclamations at all times in connection with the performance of their Services.

4. Delay. The Vendor is entitled to a reasonable time extension for an Unknown COVID-19 Condition. Such time extension is non-compensable.

5. City Directed Suspension. The City may suspend Services due to COVID-19 health concerns, even though the Vendor may be allowed to proceed with the Services based on COVID-19 Proclamations. The City may suspend the Services for its convenience. The Vendor is entitled to a time extension for a City Directed Suspension, and the contract amount will be equitably adjusted if and to the extent Vendor incurs increased costs that are Unknown COVID-19 Costs.

6. Compensation for COVID-19 Costs. City will reimburse the Vendor for Unknown COVID-19 Costs which are not included in the schedule of values.

7. Safe Work Practices. Vendor shall implement safe work practices recommended by CDC or OSHA or Cal/OSHA, which may include, inter alia, screening all employees, subcontractors, or others (“worker(s)”) at all locations where Services are performed for signs and symptoms of COVID-19; adopting staggered work schedules, e.g., providing alternating workdays or extra shifts, to reduce the total number of employees on a site at any given time and to ensure physical distancing; identifying choke points where workers are forced to stand together, such as hallways and elevators, ingress and egress points, break areas, and buses, and implement policies to maintain social distancing; coordinating deliveries in line with the employer's minimal contact and cleaning protocols; and instituting a rigorous housekeeping program to reduce dust levels at all exterior locations. Vendor remains fully responsible for following and complying with changes to recommended safe work practices from time to time.

8. Monitoring and Reporting. City may require the Vendor to actively monitor the health of its workers through temperature checks and questionnaires of major COVID- 19 symptoms, including but not limited to cough, fever above 100.4 degrees Fahrenheit and shortness of breath. Vendor shall immediately report to City any outbreaks of COVID-19 among its workers. The Vendor shall not knowingly allow any worker who has tested positive with COVID-19 to enter a City building. In the event of an outbreak

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or an exposure to COVID-19, the City may impose appropriate mitigation strategies which may be in consultation with the public health officer.

9. Conflicts. In the event of an inconsistency between this COVID-19 Amendment and the Agreement, this Addendum shall control.

IN WITNESS WHEREOF, the City and Vendor have executed this Covid-19 Amendment as of the date set forth above.

VENDOR: CITY:

________________________ ____________________________
Signature Signature

________________________ ______________________________ Print Name & Title Print Name & Title

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DATE: June 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager

FROM: Tracy Avelar, Chief of Police
DEPARTMENT: Police
SUBJECT: AUTHORIZING THE APPROPRIATION OF $15,500.00 FROM THE GENERAL FUND BALANCE TO ACCOUNT NO. 001-0610-
421-4251 for FY 2022-2023 TO PAY FOR SIX BACKGROUND

INVESTIGATIONS

RECOMMENDATION
It is recommended that City Council approve the attached resolution authorizing the Foster City Police Department (FCPD) to appropriate $15,500.00 from the City’s General Fund to Account No. 001-610-421-4251 for FY 2022-2023 to pay for six background investigations.

EXECUTIVE SUMMARY
The police department is required to conduct comprehensive background investigations of all applicants. In FY 2022-2023, the FCPD anticipated nine openings requiring background investigations. Due to unforeseen medical retirements and several failed background investigations, 13 background investigations have been completed to date.

The completion of the 13 background investigations exhausted the FCPD’s pre- employment examination budget of $21,000.00.

Current staffing vacancies still exist with six pending background investigations and one outstanding polygraph. The cost of the pending six background investigations and one polygraph will be $15,500.00.

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BACKGROUND/ANALYSIS
Starting in FY 2022-2023, vacancies existed within the FCPD that included officers, a dispatcher, and two records specialists. To fill the vacancies, recruitment was constant and the hiring process very active. For FY 22/23, nine full backgrounds and four polygraphs have been completed. Of those processes, six police officers one dispatcher and one records specialist were hired. Four officers are in the police academy, one officer is in the Field Training Program (FTO) and one was unable to complete the field training program. There were also several instances where a background was completed and either the applicant failed the background process, or the applicant changed their mind after the full background process.

Currently, there are vacancies consisting of five officer positions with four applicants in background. There is one record specialist vacancy with one applicant in background.

There is one dispatcher applicant bringing our dispatch center to fully staffed. There is one community service officer vacancy with an open recruitment.

A background investigation includes a polygraph examination, an investigation into the candidate’s personal and professional background, and a psychological evaluation. A background investigation costs on average $2,500.00 per candidate. The total cost for the pending six background investigations will be $15,500.00.

Based on the current pending background processes, it is anticipated that final payment for the pending backgrounds will be needed for FY 22/23.

California Environmental Quality Act
Not Applicable

FISCAL IMPACT
If approved, $15,500.00 will be appropriated to Account No. 001-0610-421-4251 in the FCPD budget from the City’s General Fund.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Staff Empowerment and Operational Excellence
ATTACHMENTS:

Attachment 1— Resolution

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9 RESOLUTION NO. _________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY AUTHORIZING THE APPROPRIATION OF $15,500.00 FROM THE CITY’S GENERAL FUND TO THE POLICE DEPARTMENT’S BUDGET ACCOUNT NUMBER 001-610-421- 4251 FOR SIX BACKGROUND INVESTIGATIONS

CITY OF FOSTER CITY
WHEREAS, the Foster City Police Department does not possess needed funds in the Police Department pre-employment exam budget to pay for required additional background investigations; and
WHEREAS, the Foster City Police Department requests appropriation of $15,500.00 from the City’s General Fund to make payment for the additional completed background investigations.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Foster City authorizes the appropriation of $15,500.00 from the City’s General Fund to Account No. 001-610-421-4251 to pay for the additional six background investigations.

PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the special meeting held on the 20th day of June 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:
________________________________

PRISCILLA SCHAUS, CITY CLERK

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4 DATE: June 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager

FROM: Rob Lasky, IT Manager
DEPARTMENT: Administrative Services
SUBJECT: AGREEMENT FOR FOSTER CITY IT DIVISION TO PROVIDE IT

SERVICES TO SMC FIRE

RECOMMENDATION
It is recommended that the City Council approve the attached resolution authorizing the City Manager to sign an agreement which contracts the City of Foster City (hereinafter referred to as "Foster City") Information Technology (IT) Division to provide IT Services to the San Mateo Consolidated Fire Department (hereinafter referred to as "SMC Fire") in FY 2023-2024. This agreement will result in revenues of $41,844 to the IT Internal Services Fund (ISF) that will help lower the reallocation chargebacks that the IT Division applies to the other City departments, so there is an indirect benefit to the General Fund.

EXECUTIVE SUMMARY
SMC Fire has the need of various IT services including support of their IT systems (desktops, laptops, tablets, servers, network switches, internet circuits, SD-WAN equipment, telephones, printers, copiers, and software). Assistance is also needed with IT Management functions (IT policies, IT budgeting, IT strategic planning, and IT procurement). The Foster City IT Division has the bandwidth to support SMC Fire for these functions, and the offset provided by the revenue helps to keep costs manageable for the other City departments.

BACKGROUND/ANALYSIS

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4 Prior to SMC Fire officially becoming their own entity in 2019, each of the joining Fire Departments were tied into their parent city’s IT infrastructure. SMC Fire knew they would have to find a way to remove those ties to their parent cities and run a separate network of their own. In early 2019, SMC Fire reached out to the Foster City IT Division to ask for advice. The Foster City IT Manager offered to help, with approval from the City Manager. The Foster City IT Division also offered to migrate some of SMC Fire’s virtual servers from San Mateo and Belmont to Foster City’s server infrastructure. The Foster City IT Manager assisted an SMC Fire contracted Project Manager throughout the network migration during 2019, helping to choose the vendor for their managed WAN and phone system, as well as a vendor to help refresh the PCs that were transferred from San Mateo, Belmont, and Foster City’s inventories. The new network was designed for ease of support, as SMC Fire would need to be able to survive long- term with only limited IT support. Because of this forward thinking, the number of trouble tickets has stayed low. In 2020 there were roughly 420 HelpDesk tickets opened, just under 200 tickets in 2021, and just under 300 tickets in 2022.

California Environmental Quality Act
Not Applicable

FISCAL IMPACT
The proposed charges to SMC Fire for Fiscal Year 2023-2024 is based on these line items:

Proposed Charges to SMC Fire in Fiscal Year 2022-2023 Cost 15% of IT Manager's time (overhead included) $ 38,244
6 virtual servers @ $600/year/server $ 3,600
TOTAL $ 41,844
By offering these services to SMC Fire, the Foster City IT Division has been able to lessen the impact to Foster City’s General Fund by offsetting IT ISF charges to the City’s other departments. The Foster City IT Division's project list has not been impacted by supporting SMC Fire, in part because staff had already been supporting the Foster City Fire Department prior to the separation & consolidation to SMC Fire. If the City Council chooses not to approve these resolutions, IT ISF charges to Foster City’s other departments for Fiscal Year 2022-2023 would need to be increased to cover the loss of the fees that would have been charged to SMC Fire. Additionally, SMC Fire would need to find alternative IT Support Services, potentially at higher costs.

Those costs would likely need to be recouped through SMC Fire’s charges to member agencies, which would impact Foster City’s General Fund as well.

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4 CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA Innovation and Sustainability
ATTACHMENTS:

Attachment 1 - Resolution
Attachment 2 - Agreement

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5 RESOLUTION NO.____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY

AUTHORIZING THE EXECUTION OF AN AGREEMENT FOR THE CITY OF FOSTER

CITY IT DIVISION TO PROVIDE INFORMATION TECHNOLOGY SERVICES TO THE SAN MATEO CONSOLIDATED FIRE DEPARTMENT IN THE AMOUNT OF $ 41,844 FOR FY 2023-2024 AND AUTHORIZING THE CITY MANAGER TO EXECUTE THE

AGREEMENT

CITY OF FOSTER CITY
WHEREAS, SMC Fire has the need of various IT services including support of their IT systems and IT Management functions; and
WHEREAS, Foster City IT Division has the bandwidth to support SMC Fire for these functions; and
WHEREAS, this agreement will result in revenues of $41,844 to the IT Internal Services Fund that will help lower the reallocation chargebacks that the IT Division applies to the other City departments.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Foster City does hereby authorizes the execution of an agreement for the City of Foster City IT Division to provide Information Technology services to the San Mateo Consolidated Fire Department in the amount of $41,844 for FY 2023-2024 and authorizing the City Manager to execute the agreement.

PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the special meeting held on the 20th day of June, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

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6 AGREEMENT TO PROVIDE

INFORMATION TECHNOLOGY SERVICES
This Agreement is made and entered into as of the 20th day of June, 2023 by and between the San Mateo Consolidated Fire Department, hereinafter referred to as "CLIENT", and the City of Foster City, a Municipal Corporation, hereinafter referred to as "CITY ". CLIENT and CITY shall be referred to hereinafter as the “PARTIES.”

RECITALS
This Agreement is entered into with reference to the following facts and circumstances:

A. That CLIENT has the need to secure information technology services; and B. That CITY is experienced and qualified to perform the consulting services desired by the CLIENT and is willing to perform such services; and C. That CLIENT has elected to engage the services of CITY upon the terms and conditions as hereinafter set forth; and
D. On June 6, 2022, CLIENT and CITY entered into an agreement for which CITY provided information technology services to CLIENT. The PARTIES intend to supersede and replace the June 6, 2022 service agreement with the terms set forth herein.

AGREEMENT

1. Services. The services to be performed by CITY under this Agreement shall include those services set forth in Appendix A, which is, by this reference, incorporated herein and made a part hereof as though it were fully set forth herein.

Performance of the work specified in said Appendix A is hereby made an obligation of CITY under this Agreement, subject to CLIENT’s obligations set forth in Appendix A. Any changes to the Agreement shall be made only upon the mutual written agreement of the Parties.

2. Term; Termination. (a) The term of this Agreement shall commence upon the date hereinabove written and continue for a period of twelve (12) months. At the end of each twelve (12) month period, the Agreement shall automatically renew for an additional twelve (12) month period, provided neither party terminates the Agreement as specified herein.
(b) Neither Party shall be authorized to terminate this Agreement within the first six (6) months after execution. Thereafter, either Party may terminate this Agreement without cause by giving written notice not less than thirty (30) days prior to the effective date of termination, which date shall be included in said notice.

In the event of such termination, CLIENT shall compensate CITY for out-of-scope services, as defined in Appendix A, rendered to the date of termination. If CLIENT

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6 terminates the Agreement, there shall be no refund of the yearly fees. Nothing herein contained shall be deemed a limitation upon the right of either party to terminate this Agreement for cause, or otherwise to exercise such rights or pursue such remedies as may accrue hereunder.

3. Compensation; Expenses; Payment. CITY shall provide information technology services to CLIENT pursuant to the following fee:

A. Annual Fee

1. Forty One Thousand Eight Hundred and Forty Four Dollars ($41,844) for System Administration, Maintenance and Support, as defined in Appendix A, for each subsequent year of contract renewal. The System Administration, Maintenance and Support Fee shall be due on July 1 of each year.

2. In all subsequent years, provided CLIENT does not terminate the Agreement, the yearly System Administration, Maintenance and Support Fee may be adjusted by the CITY. Any adjustment to the System Administration, Maintenance and Support Fee will take effect on July 1, and requires notice to CLIENT on or before June 1 of the year in which the adjustment will take effect.

B. CLIENT shall promptly review invoicing and notify CITY of any objection thereto in writing within ten (10) business days of receipt of the invoice, and absent such objection, the invoice shall be deemed proper and acceptable, and shall be due thirty (30) days after billing. Absent such objection, unpaid fees shall bear interest from the date due at the maximum rate then allowable by law.

4. Records. CITY shall keep and maintain accurate records of all time expended and costs and expenses incurred relating to services to be performed by CITY hereunder. Said records shall be available to CLIENT for review and copying during regular business hours at CITY’s place of business or as otherwise agreed upon by the Parties.

5. Authorization. This Agreement becomes effective when endorsed by both Parties in the space provided below.

6. Reliance on Professional Skill of CITY. CITY represents that it has the necessary professional skills to perform the services required and the CLIENT shall rely on such skills of the CITY to do and perform the work. In performing services hereunder CITY shall adhere to the standards generally prevailing for the performance of expert consulting services similar to those to be performed by CITY hereunder.

7. Relationship of Parties. It is understood that the relationship of CITY to the CLIENT is that of an independent contractor and all persons working for or under the direction of CITY are its agents or employees and not agents or employees of the CLIENT.

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6 8. Defaults/Remedies. The occurrence of any one or more of the following events shall constitute a material default or breach of this Agreement by CLIENT:

A. Failure by the CLIENT to make any payment of fees required under this Agreement where such failure shall continue for a period of fifteen (15) business days after written notice by CITY.

B. Violation of any of the terms of Content Agreements as listed in Appendix A to this Agreement.

In the event of a material default or breach by CLIENT, the CITY may, without limiting the CITY’s rights or remedies, terminate information technology services to CLIENT and all other services provided herein.

9. Indemnity. CLIENT hereby agrees to defend, indemnify, and save harmless CITY, its Council, boards, commissions, officers, employees and agents, from and against any and all claims, suits, actions, liability, loss, damage, expense, cost (including, without limitation, costs and fees of litigation) of every nature, kind or description, which may be brought against, or suffered or sustained by, CITY, its Council, boards, commissions, officers, employees or agents caused by, or alleged to have been caused by, negligence, intentional tortious act or omission, or willful misconduct of CLIENT, its officers, employees or agents in the performance of any services or work pursuant to this Agreement.

CITY hereby agrees to defend, indemnify, and save harmless CLIENT, its Council, boards, commissions, officers, employees and agents, from and against any and all claims, suits, actions, liability, loss, damage, expense, cost (including, without limitation, costs and fees of litigation) of every nature, kind or description, which may be brought against, or suffered or sustained by, CLIENT, its Council, boards, commissions, officers, employees or agents caused by, or alleged to have been caused by, negligence, intentional tortious act or omission, or willful misconduct of CITY, its officers, employees or agents in the performance of any services or work pursuant to this Agreement.

10. Notice. All notices required by this Agreement shall be given to the CITY and CLIENT in writing, by first class mail, postage prepaid, addressed as follows:

CITY: City of Foster City
610 Foster City Boulevard
Foster City, CA 94404-2299
Attention: IT Manager
CLIENT: San Mateo Consolidated Fire Department
1040 East Hillsdale Blvd
Foster City CA 94404

11. Non-Assignment. This Agreement is not assignable either in whole or in part.

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6 12. Amendments. This Agreement may be amended or modified only by written agreement signed by both Parties.

13. Validity. The invalidity in whole or in part of any provision of this Agreement shall not void or affect the validity of any other provision of this Agreement.

14. Governing Law. This Agreement shall be governed by the laws of the State of California and any suit or action initiated by either party shall be brought in the County of San Mateo, California. In the event of litigation between the Parties hereto to enforce any provision of the Agreement, the unsuccessful party will pay the reasonable attorney’s fees and expenses of litigation of the successful party.

15. Mediation. Should any dispute arise out of this Agreement, the Parties shall first meet in mediation and attempt to reach a resolution with the assistance of a mutually acceptable mediator. Neither party shall be permitted to file legal action without first meeting at least once in mediation and making a good faith attempt to reach a mediated resolution. The costs of the mediator, if any, shall be paid equally by the Parties. If a mediated settlement is reached neither party shall be deemed the prevailing party for purposes of the settlement, and each party shall bear its own legal costs.

16. Entire Agreement. This Agreement, including its Appendix A and Appendix B, comprises the entire Agreement between the PARTIES.

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6 IN WITNESS WHEREOF, the PARTIES hereto have caused this Agreement to be executed on the date first above written by their respective officers duly authorized in that behalf.

CITY
A Municipal Corporation
Dated: _______________ __________________________________________ Stefan Chatwin, City Manager
ATTEST:

Dated: _______________ __________________________________________ Priscilla Schaus, City Clerk
Approved as to Form:

Dated: _______________ __________________________________________ Benjamin Stock, City Attorney
CLIENT: San Mateo Consolidated Fire Department
Dated: __________________________________________________________ Kent Thrasher, Fire Chief

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6 Appendix A

SUPPORT
CITY shall support CLIENT desktops, laptops, tablets, servers, network switches, internet circuits, SD-WAN equipment, telephones, printers, copiers, Office 365, Eden, and other business-related software.

SERVICES
CITY shall assist CLIENT in creation and/or maintenance of IT policies, IT budgeting, IT strategic planning, and IT procurement.

HOURS
CITY staff are available 8-5 Business Days, observing CITY holidays. For off hours work, CITY shall make best efforts to provide services.

SLA
For emergencies, CITY staff will call back and/or reply via email within 30 minutes. For non- emergencies, CITY staff will do its best to reply within 1 business day.

SERVER HOSTING
CITY shall provide hosting for 6 virtual servers (AlwaysOnScene and Telestaff) as well as rack space and power for CLIENT’s single hardware server.

OUT OF SCOPE SERVICES
Any other services (such as larger projects, etc.) are out of the scope of this agreement and would need to be negotiated on a time and materials basis.

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6 Appendix B

PAYMENT SCHEDULES
In consideration for the full performance of the services set forth in Exhibit A, CLIENT agrees to pay CITY a fee in an amount of $ 41,844 annually. CITY will invoice CLIENT the annual fee amount on or about July 1. Payment will be due within 30 days of the invoice date.

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4889-3236-9256 v2
3 6
7 DATE: June 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager

FROM: Priscilla Schaus, Communications Director/City Clerk Austin Walsh, Communications Manager
DEPARTMENT: Communications/City Clerk
SUBJECT: CONTRACT AMENDMENT NO. 2 WITH TRIPEPI SMITH AND ASSOCIATES INC. FOR STRATEGIC COMMUNICATIONS AND

OUTREACH SERVICES FOR THE LEVEE PROTECTION
PLANNING AND IMPROVEMENTS PROJECT (CIP 327-657)

RECOMMENDATION
It is recommended that the City Council adopt the attached resolution approving Contract Amendment No. 2 in the amount-not-to-exceed $70,039.62 with Tripepi Smith and Associates (Tripepi Smith) for a six-month contract extension for Strategic Communication and Outreach Services on an ad hoc basis through completion of the Levee Protection Planning and Improvements Project (CIP 327-657).

EXECUTIVE SUMMARY
A key priority of the Levee Project is to keep community members informed and updated on the progress of the project, such as timelines, impacts, milestones, and other key information. On July 19, 2021, the City Council approved a contract with Tripepi Smith for an initial period of one year from August 1, 2021 to July 31, 2022 for a total amount not to exceed $127,056, for Strategic Communication and Outreach Services for the Levee Project. The purpose of using the specialized services of Tripepi Smith was to ensure continuing comprehensive and proactive communications, outreach efforts, and responsive and timely communications to citizen inquiries.

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7 The initial term of the contract expired, and the project team determined the communications support by Tripepi Smith continued to yield positive results. On June 20, 2022 City Council approved a one-year extension on the agreement with Tripepi Smith from August 1, 2022, to July 31, 2023, for an additional amount not-to-exceed $133,408.80, and that contract extension was approved (Contract Amendment No. 1).

With the Levee Improvement Project expected to achieve final completion by January 2024, staff is recommending the agreement with Tripepi Smith be extended for another six-month period, with compensation based on time and materials expended. Staff is recommending a second contract amendment for services to be provided on an ad hoc basis for a six-month period as opposed to an additional one-year extension with a monthly retainer which would span until July 2024, exceeding the timeframe for project completion. Extending the agreement for six months would allow for services through the anticipated project completion which is scheduled for January 2024.

BACKGROUND
Construction of the Levee Project began in October of 2020 and will continue through January 2024. As construction continues over the project timeline, the City will continue to conduct extensive, proactive communications and outreach on the project duration, impacts, updates, and other important information. The City has communicated with residents through various platforms and methods, including: social media, press releases, project website, mailers, flyers, Community Update webinars, and a construction update electronic newsletter.

The City saw a need for additional communications support to inform the community and address concerns raised by the public related to the largest public works project in the City’s history. As the start of construction commenced during the COVID-19 pandemic, the City received a high volume of inquiries and concerns from community members through email, phone, and a Change.org petition. To address this growing need for education and information, in early 2021, the City entered into a short-term agreement with Tripepi Smith in an amount not to exceed $49,000 for proactive communications support and services for the Levee Project. Further, the City Council authorized the execution of a contract amendment in the amount of $61,000 and the increased contract amount of $110,000 provided sufficient funding to cover all costs for Tripepi Smith’s work through July 31, 2021. A total of $93,478.75 was spent from January 4 to July 31, 2021, and the unused contract funds were returned to the Levee Project account.

On July 19, 2021, City Council approved a longer-term contract with Tripepi Smith in an amount not to exceed $127,056 from August 1, 2021 to July 31, 2022 for Strategic Communication and Outreach Services for the Levee Project. The agreement was initially brought to the City Council as an agreement for a one-year term with two optional one-year extensions to be exercised at the City Manager's discretion. At this meeting, the City Council approved only the one-year term and directed staff to come

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7 back to the City Council for any extensions of the contract. Services provided were within the budgeted amount and $98,931.44 was spent for the initial one-year term. A subsequent one-year contract extension (Contract Amendment No. 1) was approved on June 20, 2022 for an amount not to exceed $133,408.80. As of April 30, 2023, $84,996 or 63%, has been spent of the total contract amount and $48,412 remains with three billable months remaining. Monthly costs have varied from $11,107 in August 2021, to $7,081 in February 2022 and have generally averaged approximately $8,000 per month over the life of the project. The average monthly billing has been greater than the retainer because the retainer was intended to cover only a handful of core services and any additional work beyond that limited scope was considered ad hoc, under which hourly rates are applicable.

Generally, there has been a decrease in costs as project construction has continued as anticipated, and it is expected that unspent funds will remain at the end of the contract, to be returned to the Levee Project account. As an additional resource, Tripepi Smith has helped to enhance the Project’s communications efforts through a new standalone website, more comprehensive and easier to understand FAQs, community updates, and the preparation of presentations and talking points for project team staff. Tripepi Smith has proactively communicated ongoing activities to address topics of interest clearly and efficiently. Staff has evaluated the services provided and recommends a contract amendment to continue communication and support services and ensure that the community continues to receive extensive, proactive communications and outreach on project information. If the contract amendment is approved at tonight's meeting, work will be provided on an ad hoc basis according to time and materials expended until project completion anticipated in January 2024 and funds not expended will be returned to the Levee Project account.

ANALYSIS
The contract is currently set with a monthly retainer of $6,500 with other ad hoc charges as additional services are incurred. The retainer amount includes a limited scope of work consisting of items that are expected to be completed regularly, such as production of the construction newsletter, website content updates, project management, creation of social media, and other tasks. Other items in the scope of work are expected to be necessary, but demand cannot be readily predicted, therefore paying for these items on a time and materials basis is preferred. With the project winding down in the months leading up to completion, staff expects that the amount of community outreach and engagement necessary will dwindle as well. As a result, staff is recommending that an amended agreement based solely on a time and materials is preferable to paying a monthly retainer and ad hoc services. With the contract amendment, Tripepi Smith will continue to offer the services outlined in the Professional Services Agreement for Communications Support Services for the Levee Improvements Project (CIP-657). But the provision of services on an ad hoc basis will grant greater flexibility to account for the changing nature of the outreach needed, while also allowing for termination at the end of project completion, rather than maintaining full annual contract that would likely span beyond the expected project completion. The contract

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7 amendment not-to-exceed amount also includes a 5% increase to reflect Consumer Price Index (CPI).

Staff evaluated the services provided by Tripepi Smith and determined that the contract amendment would ensure the necessary communications support services are procured for this ongoing, large-scale project on an ad hoc basis. As part of the contract, Tripepi Smith will continue to provide communications and outreach support including, but not limited to: Drafting content / messaging for Levee Project updates, such as social media, press releases, newsletters, talking points, frequently asked questions (FAQs), flyers, and/or mailers; Designing graphics for social media, flyers, signage, and/or mailers and coordinating distribution; Managing and maintaining the Levee Project electronic newsletter; Managing and maintaining the Levee Project website; Developing concepts for and producing Levee Project informational videos; Developing outreach strategies for engaging target audiences; Managing the Levee Project inquiry hotline and email inbox; Developing memos to keep the City Council informed; Coordinating with the Levee Project construction team and other staff on key updates to keep the community informed; Organizing and hosting virtual or in-person Community Updates; Monitoring social media to understand community sentiment; Facilitating media inquiries and developing messaging for interviews; Evaluating and measuring outreach efforts; Preparing presentations and materials for the Levee Project team to present at conferences or other regional meetings; Attending and presenting communications efforts at City Council meetings; Develop event timelines and talking points for ribbon cuttings or other events.

Communication and public engagement are critical components of the overall project, and there is continued need for focused and targeted communications. Although staff has seen some leveling of the community-wide concern recently, continued spikes in community interest are possible as the project nears completion. To retain an appropriate level of service and response, staff anticipates the need for continued focus on proactive communications to share information and project updates in a timely manner. Staff will continue to review the need for all of these services on an ongoing basis, as the project nears completion and certain needs may taper off.

California Environmental Quality Act
Approval of a Contract Amendment is not subject to review under the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21000, et seq. and the CEQA Guidelines (14 Cal. Code Regs. §§ 15000 et. seq.), including without limitation, Public Resources Code section 21065 and California Code of Regulations 15378 as this is not a “project” that may cause a direct, or reasonably foreseeable indirect, physical change in the environment.

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7 FISCAL IMPACT
There is adequate funding available in the budget for the Levee Project for Contract Amendment No. 2 in the amount not-to-exceed $70,039.62. Although staff does not expect cost increases as the project continues, the six-month full amount is requested to account for the possibility of unforeseen circumstances arising during the remaining construction period. Unused funds from the contract will be returned to the Levee Project account number 327-0910-657-4251.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
City Council Operations and Improved Community Engagement ATTACHMENTS:

Attachment 1 – Resolution
Attachment 2 – Contract Amendment No. 2
Attachment 3 – Contract Amendment No. 1 (contract extension dated 6/20/22) Attachment 4 – Agreement

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8 RESOLUTION NO.____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY AUTHORIZING CONTRACT AMENDMENT NO. 2 WITH TRIPEPI SMITH AND ASSOCIATES INC. IN THE AMOUNT NOT-TO-EXCEED $70,039.62 FOR STRATEGIC

COMMUNICATIONS AND OUTREACH SERVICES FOR THE LEVEE PROTECTION PLANNING AND IMPROVEMENTS PROJECT (CIP 327-657)

CITY OF FOSTER CITY
WHEREAS, as construction continues on CIP 327-657 Levee Protection Planning and Improvements Project, the City will continue to conduct extensive, proactive communications and outreach on the project duration, impacts, updates, and other information; and
WHEREAS, the City saw a need for additional communications support to inform the community and address concerns raised by the public related to the largest public works project in the City’s history; and
WHEREAS, to address this growing need for education and information, the City executed an agreement on January 4, 2021, with Tripepi Smith and Associates, Inc. for Proactive Communications Support and Services for the Levee Project. Subsequently, the City Council authorized a contract amendment on February 16, 2021 to cover additional work; and
WHEREAS, the City entered into an agreement with Tripepi Smith and Associates, Inc. from July 1, 2021 to June 30, 2022 in an amount not to exceed $127,056 with the option to extend the agreement for two additional one-year terms, upon demonstration of satisfactory performance and City Council approval; and WHEREAS, the City Council approved a subsequent one-year contract extension on the agreement with Tripepi Smith and Associates, Inc. from August 1, 2022 to July 31, 2023 for an amount not to exceed $133,408.80; and
WHEREAS, Staff evaluated the services provided by Tripepi Smith and Associates, Inc. and determined that Contract Amendment No. 2 would ensure the necessary communications support services are procured for this ongoing, large-scale project on an ad hoc basis; and
WHEREAS, the Levee Improvements Project is expected to achieve final completion by January 2024, and staff is recommending the agreement with Tripepi Smith be extended for another six-month period, with compensation based on time and materials expended; and

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8 WHEREAS, as presented in the agreement, the contact amendment is to not exceed $70,039.62 with Tripepi Smith and Associates, Inc, which is reflective of the previous agreements and a 5% Consumer Price Index increase; and

NOW, THEREFORE, BE IT RESOLVED that the City Council does hereby approve Contract Amendment No. 2 in the amount-not-to-exceed $70,039.62 with Tripepi Smith and Associates (Tripepi Smith) for a six-month contract extension from August 1, 2023 through January 31, 2024 for Strategic Communication and Outreach Services on an ad hoc basis through completion of the Levee Protection Planning and Improvements Project (CIP 327-657).

PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the special meeting held on the 20th day of June 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

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ORIGINAL
4881-6101-0536 v1

CITY OF FOSTER CITY
CONTRACT AMENDMENT NO. 02
DATE: June 20, 2023 ACCOUNT NO. [327-0910-657-4251] PROJECT NAME: Strategic Communications and Outreach Services for the Levee Protection Planning and Improvements Project
TO: Tripepi Smith and Associates
CHANGE REQUESTED BY: Tripepi Smith and Associates and City of Foster City Based on mutual agreement, Tripepi Smith and Associates and City of Foster City agree to amend the original Agreement dated August 9, 2021 (“Agreement”) pursuant to Section 17 of the Agreement to extend the term of the Agreement to terminate on January 31, 2024. Additionally, Tripepi Smith and Associates and the City of Foster City agree to amend Exhibit B of the Agreement to provide that for the period commencing on or after August 1, 2023 to January 31, 2024, Tripepi Smith shall bill their services at the hourly billing rates, which include a 5% CPI increase, identified in Exhibit A, attached hereto and hereinafter incorporated by reference,(instead of a one-year extension with a monthly retainer of $6,500 and additional ad hoc services) which total amount shall not exceed $70,039.62.

ORIGINAL CONTRACT AMOUNT $127,056

AMOUNT OF CONTRACT EXTENSION JUNE 20, 2022
(AMENDMENT NO.1)
$133,408.80
AMOUNT OF CONTRACT AMENDMENT NO. 2 $70,039.62 ____ REVISED TOTAL CONTRACT AMOUNT $330,504.42 Except as specifically modified herein, all other terms and provisions in the Agreement shall remain unchanged.

Tripepi Smith has given careful consideration to the work proposed and hereby agree, if this proposal is approved, to provide all equipment, furnish all materials except as may otherwise be noted above, and to perform all services necessary for the work above specified, and to accept as full payment therefore the prices shown above. [SIGNATURES ON NEXT PAGE]

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SUBMITTED BY:

Priscilla Schaus June 20, 2023
Communications Director/City Clerk
ACCEPTED BY:

Ryder Todd Smith, President DATE
Tripepi Smith
APPROVAL RECOMMENDED:

Stefan Chatwin DATE

CITY MANAGER
APPROVED FOR CITY:

Jon Froomin DATE
MAYOR
ATTEST:

BY:

PRISCILLA SCHAUS, CITY CLERK
APPROVED AS TO FORM:

BY: ___________________________________
BENJAMIN L. STOCK, CITY ATTORNEY

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6.8 Attachment 2 - Contract Amendment No. 2

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June 20, 2022

Dear Ryder,
Per the terms of the agreement between the parties, this letter services as a notice, due to satisfactory performance under the terms of the agreement dated August 1, 2021, the City of Foster City is extending the agreement with Tripepi Smith and Associates, Inc. for a second one-year term from August 1, 2022, to July 31, 2023.

Pursuant to Exhibit B of the agreement, the not to exceed compensation for services shall increase 5% to $133,408.80. All other provisions of the agreement shall remain unchanged for the new contract terms.

Questions about this agreement extension, the agreement terms, or the work performed under the agreement should be addressed to Communications Director/City Clerk Priscilla Schaus at [email protected].

We look forward to a continued successful partnership.

CITY OF FOSTER CITY

_______________________
Richa Awasthi, Mayor
City of Foster City

TRIPEPI SMITH

_______________________
Ryder Todd Smith
President, Tripepi Smith
610 FOSTER CITY BOULEVARD
FOSTER CITY, CA 94404
DocuSign Envelope ID: A3A67F33-178E-4BA8-900A-C9ABF874B1BF

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PROFESSIONAL SERVICES AGREEMENT
FOR

COMMUNICATIONS SUPPORT SERVICES FOR THE LEVEE PROTECTION PLANNING AND IMPROVEMENTS PROJECT (CIP 657)

This Agreement is made and entered into as of th e 1st day of August, 20 21 by and between the City of Foster City hereinafter cal led "CITY " and Tripepi Smith and Associates, Inc. hereinafter called "CONSULTANT".

RECITALS

This Agreement is entered into with reference to the following facts and circumstances:

A. That CITY desires to engage CONSULTANT to provide professional services in the CITY;

B. That CONSULTANT is qualified to provide such services to the CITY and;

C. That the CITY has elected to engage the services of CONSULTANT upon the terms and conditions as hereinafter set forth.

1. Services. The services to be performed by CONSULTANT under this Agreement shall include those services set forth in Exhibit A, which is, by this reference, incorporated herein and made a part hereof as though it were fully set forth herein.

Performance of the work specified in said Exhibit A is hereby made an obligation of CONSULTANT under this Agreement, subject to any changes that may be made subsequently hereto upon the mutual written agreement of the said parties.

Where in conflict, the terms of this Agreement supersede and prevail over any terms set forth in Exhibit A.

2. Term; Termination. (a) The term of this Agreement shall commence upon the date hereinabove written and shall expire upon completion o f performance of services hereunder by CONSULTANT. (b) Notwithstanding the provisions of (a) above, either party may terminate this Agreement without cause by giving written notice not less than ten (10) days prior to the effective date of termination, which date shall be included in said notice.

In the event of such termination, CITY shall compensate CONSULTANT for services rendered, and reimburse CONSULTANT for costs and expenses incurred, to the date of termination, calculated in accordance with the provisions of paragraph 3. In ascertaining the services actually rendered to the date of termination, consideration shall be given both to completed work and work in process of completion. Nothing herein contained shall be deemed a limitation upon the right of CITY to terminate this Agreement for cause, or otherwise to exercise such rights or pursue such remedies as may accrue to CITY hereunder. The initial contract will be for a one -year DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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agreement. At the City’s sole discretion, the City can extend the term of the agreement for up to two additional one-year term extensions upon approval from the City Council evidenced by motion duly made and carried and notice of the approval to CONSULTANT.

3. Compensation; Expenses; Payment . CITY shall compensate CONSULTANT for all services performed by CONSULTANT hereunder in an amount based upon CONSULTANT’s hourly rates during the time of the performance of said services. A copy of CONSULTANT’s hourly rates for which services hereunder sha ll be performed are set forth in CONSULTANT’s fee schedule marked Exhibit “B” hereof, attached hereto and by this reference incorporated herein.

Notwithstanding the foregoing, the combined total of compensation and reimbursement of costs payable hereunder shall not exceed the sum of one hundred twenty seven thousand and fifty six dollars ($127,056). Invoices for amounts in excess of one hundred twenty seven thousand and fifty six dollars ($127,056) for the first 12 months shall not be paid unless the performance of services and/or reimbursement of costs and expenses in excess of said amounts have been approved in advance of performing such services or incurring such costs and expenses by the City Manager (for contracts less than $50,000) or City Council (for contracts $50,000 or more) evidenced by motion duly made and carried and a written contract amendment having been executed.

Compensation and reimbursement of costs and expenses hereunder shall be payable upon monthly billing therefor by CONSULTANT to CITY, which billing shall include an itemized statement, briefly describing by task and labor category or cost/expense items billed.

4. Additional Services. In the event CITY desires the performance of additional services not otherwise incl uded within the services described in Exhibit A, such services shall be authorized in advance of the performance thereof by the City Manager (for contracts less than $ 50,000) or City Council (for contracts $ 50,000 or more) by motion duly made and carried. Such amendment to this Agreement shall include a description of the services to be performed thereunder, the maximum compensation and reimbursement of costs and expenses payable there for, the time of performance thereof, and such other matters as the parti es deem appropriate for the accomplishment of such services. Except to the extent modified by written amendment, all other terms and conditions of this Agreement shall be deemed incorporated in each such amendment.

5. Records. CONSULTANT shall keep and ma intain accurate records of all time expended and costs and expenses incurred relating to services to be performed by CONSULTANT hereunder. Said records shall be available to CITY for review and copying during regular business hours at CONSULTANT’s place of business or as otherwise agreed upon by the parties.

DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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6. Authorization. This Agreement becomes effective when endorsed by both parties in the space provided below.

7. Reliance on Professional Skill of CONSULTANT. CONSULTANT represents that it has the necessary professional skills to perform the services required and the CITY shall rely on such skills of the CONSULTANT to do and perform the work. In performing services hereunder CONSULTANT shall adhere to the standards genera lly prevailing for the performance of expert consulting services similar to those to be performed by CONSULTANT hereunder.

8. Documents. All documents, plans, drawings, renderings, and other papers, or copies thereof, as finally rendered, prepared by CONSULTANT pursuant to the terms of this Agreement, shall, upon preparation and delivery to CITY, become the property of CITY.

9. Relationship of Parties . It is understood that the relationship of CONSULTANT to the CITY is that of an independent contractor a nd all persons working for or under the direction of CONSULTANT are its agents or employees and not agents or employees of the CITY.

10. Schedule. CONSULTANT shall adhere to the schedule set forth in Exhibit A; provided, that CITY shall grant reasonable extensions of time for the performance of such services occasioned by governmental reviews of CONSULTANT’s work product or other unavoidable delays; provided, further, that such unavoidable delay shall not include strikes, lockouts, work stoppages, or other labor disturbances conducted by, or on behalf of, CONSULTANT’s officers or employees.

CONSULTANT acknowledges the importance to CITY of CITY’s Project schedule and agrees to put forth its best professional efforts to perform its services under this Agreement in a manner consistent with that schedule.

11. Indemnity. To the fullest extent allowed by law, CONSULTANT hereby agrees to defend, indemnify, and save harmless CITY and Estero Municipal Improvement District, its Council, boards, commissions, officers, employees and agents, from and against any and all claims, suits, actions liability, loss, damage, expense, cost (including, without limitation, costs and fees of litigation) of every nature, kind or description, which may be brought against, or suffered or sustained by, City of Foster City or Estero Municipal Improvement District, its Council, boards, commissions, officers, employees or agents caused by, or alleged to have been caused by, the negligence, intentional tortuous act or omission, or willful misconduct of CONSULTANT, its officers, employees, subcontractors or agents in the performance of any services or work pursuant to this Agreement.

The duty of CONSULTANT to indemnify and save harmless, as set forth herein, shall include the duty to defend as set forth in Section 2778 of the DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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California Civil Code; provided, however, that nothing herein contained shall be construed to require CONSULTANT to indemnify City of Foster City and Estero Municipal Improvement District, its C ouncil, boards, commissions, officers, employees and agents against any responsibility or liability in contravention of Section 2782 of the California Civil Code.

CONSULTANT’s responsibility for such defense and indemnity obligations shall survive the ter mination or completion of this Agreement for the full period of time allowed by law.

The defense and indemnification obligations of this agreement are undertaken in addition to, and shall not in any way be limited by, the insurance obligations contained within this Agreement.

12. Insurance. CONSULTANT shall acquire and maintain Workers’ Compensation, employer’s liability, commercial general liability, owned and non-owned and hired automobile liability, and professional liability insurance coverage relating to CONSULTANT’s services to be performed hereunder covering CITY’s risks in form subject to the approval of the City Attorney and/or CITY’s Risk Manager. The minimum amounts of coverage corresponding to the aforesaid categories of insurance per insurable event, shall be as follows:

Insurance Category Minimum Limits

Workers’ Compensation statutory minimum

Employer’s Liability $1,000,000 per accident for bodily injury or disease

Commercial General Liability $1,000,000 per occurrence and $2,000,000 aggregate for bodily injury,
personal injury and property damage

Automobile Liability $1,000,000 per accident for bodily injury and property damage (coverage required
to the extent applicable to
CONSULTANT’s vehicle usage in
performing services hereunder)

1Professional Liability $1,000,000 per claim and aggregate

It shall be a requirement under this Agreement that any available insurance proceeds broader than or in excess of the specified minimum insurance

1 Note: Professional liability insurance coverage is not required if the CONSULTANT is not providing a service regulated by the state. (Examples of service providers regulated by the state are insurance agents, professional engineers, doctors, certified public accountants, lawyers, etc.) Please check and initial the following if professional liability is NOT required for this agreement.  Recommended ______ [Project Manager]  Approved _______[Risk Manager]
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coverage requirements and/or limits shall be available to the CITY as an Additional Insured. Furthermore, the requirements for coverage and limits shall be the greater of either (1) the minimum coverage and limits specified in this Agreement or (2) the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to th e named Insured.

CONSULTANT agrees to include with all subcontractors in their subcontracts the same requirements and provisions of this agreement including the indemnity and insurance requirements to the extent they apply to the scope of the subcontract or’s work. Subcontractors hired by CONSULTANT shall agree to be bound to CONSULTANT and CITY in the same manner and to the same extent as CONSULTANT is bound to CITY under this Agreement and its accompanying documents. Subcontractors shall further agree to include these same provisions with any sub - subcontractors. A copy of the indemnity and insurance provisions of this Agreement will be furnished to the Subcontractor upon request.

CONSULTANT shall require all subcontractors to provide a valid certificate of insurance and the required endorsements included in the subcontract agreement and will provide proof of compliance to the CITY prior to commencement of any work by the subcontractor.

Concurrently with the execution of this Agreement, CONSULTANT shal l furnish CITY, on the form included as Exhibit D or similar form, with certificates and copies of information or declaration pages of the insurance required hereunder to be included as Exhibit C hereto. With respect to evidence of commercial general liab ility and automobile liability insurance coverage, CONSULTANT must also include in Exhibit C the following original endorsements:

(a) Precluding cancellation or reduction in per occurrence limits before the expiration of thirty (30) days (10 days for nonpayment) after CITY shall have received written notification of cancellation in coverage or reduction in per occurrence limits by first class mail;

(b) Naming the City of Foster City and Estero Municipal Improvement District, its Council, officers, boards, commissions, employees, and agents, as additional insureds; and

(c) Providing that CONSULTANT’s insurance coverage shall be primary insurance with re spect to City of Foster City and Estero Municipal Improvement District, its Council, officers, boards, commissions, employees, and agents, and any insurance or self -insurance maintained by CITY for itself, its Council, officers, boards, commissions, employ ees, or agents shall be in excess of CONSULTANT’s insurance and not contributory with it.

CONSULTANT and its insurer may not seek contribution from CITY’s insurance or self-insurance.

DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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The limits of insurance required in this agreement may be satisfied by a combination of primary and umbrella or excess insurance. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and non-contributory basis for the benefit of CITY, to the ex tent required by this Agreement, before the CITY’s insurance or self-insurance may be called upon to protect CITY as a named Insured.

All self-insured retentions (SIR) must be disclosed to CITY for approval and shall not reduce the limits of liability coverage. Policies containing and SIR provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named CONSULTANT/Named Insured or CITY.

CITY reserves the right to obtain a full certified copy of any insurance policy and endorsements. Failure to exercise this right shall not constitute a waiver of right to exercise later.

Any and all Subcontractors shall agree to be bound to CONSULTANT and CITY in the same manner and to the same extent as CONSULTANT is bound to CITY under this Agreement. Subcontractors shall further agree to include the same requirements and provisions of this Agreement, including the indemnity and insurance requirements, in any agreement with sub - subcontractors to the extent that they apply to the scop e of the sub - subcontractor’s work. A copy of the indemnity and insurance provisions of this Agreement shall be furnished to any subcontractor upon request.

CONSULTANT shall maintain insurance as required by this Agreement to the fullest amount allowed by law and shall maintain in surance for a minimum of five (5) years following completion of this project or service. In the event CONSULTANT fails to obtain or maintain completed operations coverage as required by this Agreement, the CITY at its sole discretion may purchase the coverage required and the cost will be paid by CONSULTANT.

13. WORKERS' COMPENSATION. CONSULTANT certifies that he is aware of the provisions of the Labor Code of the State of California which require every employer to be insured against liability for workers' compensation or to undertake self-insurance in accordance with the provisions of that Code, and CONSULTANT certifies that he will comply with such provisions before commencing the performance of the work of this agreement.

14. NON-DISCRIMINATION. The CONSULTANT will not discriminate against any employee or applicant for employment because of race, color, religion, sex or national origin. The CONSULTANT will take affirmative action to ensure that applicants are employed and the employees are treated during employment without regard to their race, color, religion, sex or national origin. Such a ction shall include, but not be limited to the following:
employment, advancement, demotion, transfer, recruitment, or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including appre nticeship. The DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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CONSULTANT shall at all times be in compliance with the requirements of the Federal Americans With Disabilities Act (Public Law 101 -336) which prohibits discrimination on the basis of disability by public entities. The CONSULTANT agrees to post in conspicuous places available to employees and applicants for employment any notices provided by the CITY setting forth the provisions of this non-discrimination clause.

15. Notice. All notices required by this Agreement shall be given to the CITY and CONSULTANT in writing, by first class mail, postage prepaid, addressed as follows:

CITY: City of Foster City
610 Foster City Boulevard
Foster City, CA 94404-2299
Attention: Priscilla Schaus, Communications
Director/City Clerk

CONSULTANT: Tripepi Smith & Associates
P.O. Box 52152
Irvine, CA 92619
Attention: Ryder Todd Smith, President
(626) 536-2173
[email protected]

16. Non-Assignment. This Agreement is not assignable either in whole or in part.

17. Amendments. This Agreement may be amended or modified only by written agreement signed by both parties.

18. Validity. The invalidity in whole or in part of any provision of this Agreement shall not void or affect the validity of any other provision of this Agreement.

19. Governing Law. This Agreement shall be governed by the laws of the State of California and any suit or action initiated by either party shall be brought in the County of San Mateo, California. In the event of litigation between the parties hereto to enforce any provision of the Agreement, the unsuccessful party will pay the reasonable attorney’s fees and expenses of litigation of the successful party.

20. Mediation. Should any dispute arise out of this Agreement, the parties shall meet in mediation and attempt to reach a resolution with the assistance of a mutually acceptable mediator. Neither party shall be permitted to file legal action without first meeting in mediation and making a good faith attempt to reach a mediated resolution. The costs of the mediator, if any, shall be paid equally by the parties. If a mediated settlement is reached neither party shall be deemed the prevailing party for purposes of the settlement and each party shall bear its own legal costs.

DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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21. Conflict of Interest. CONSULTANT may serve other clients, but none who are active within the City of Foster City or who conduct business that would place CONSULTANT in a "conflict of interest" as that term is defined in State law.

22. Entire Agre ement. This Agreement, including Exhibit s A, B C, and D , comprises the entire Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the date first above written by their respective officers duly authorized in that behalf.

CITY OF FOSTER CITY

Dated: _________________________________ Sanjay Gehani, Mayor
(for contracts $50,000 or more)

ATTEST:

Dated: ________________________________ Priscilla Schaus, City Clerk

APPROVED AS TO FORM

Dated:

Benjamin Stock, City Attorney

CONSULTANT

Dated:

Ryder Todd Smith, President
Tripepi Smith

DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91 8/8/2021 | 10:28 AM PDT
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EXHIBIT A

SCOPE OF WORK AND SCHEDULE
FOR

COMMUNICATIONS SUPPORT SERVICES FOR THE LEVEE PROTECTION PLANNING AND IMPROVEMENTS PROJECT (CIP 657)

The consultant will work closely with the City Manager’s Department, Communications Division, and Project Manager to provide ongoing strategic and proactive communications and outreach services on the Levee Project. Communications and outreach services and support may include, but are not limited to:

DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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EXHIBIT B
CONSULTANT’S FEE SCHEDULE

The initial contract is for a not to exceed amount for a term of one-year agreement with two optional one-year extensions. The City has requested pricing on both a time and materials basis and set monthly cost and reserves the right for each option for the duration of the agreement.

The City has opted to utilize the retainer rate of $6,500 per month, with additional work charged at the reduced retainer rate as detailed below. The optional one-year extensions are subject to City Council approval.
 The initial contract from August 1, 2021 – July 31, 2022 not to exceed amount is $127,056.  The first optional one-year extension from August 1, 2022 – July 31, 2023 not to exceed amount is $133,408.80 which includes a 5% CPI increase.
 The second optional one -year extension from August 1, 2023 – July 31, 2024 not to exceed amount is $140,079.24 which includes a 5% CPI increase. It should be noted that the full contract amount may not be needed for this term as the project is anticipated to be fully completed in January 2024.

DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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EXHIBIT C

INSURANCE FORMS

CONSULTANT shall provide , in addition to the Certificates of Insurance , original Endorsement affecting the coverages specified in Section 1 2 - INSURANCE of the Agreement on the attached form. No substitute form will be accepted.

ATTACHED

1. Insurance Coverage Form

DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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19 Updated 12/15/2020

EXHIBIT D
This INSURANCE COVERAGE FORM modifies or documents insurance provided under the following:

Named Insured: Effective Work Date(s):

Description of Work/Locations/Vehicles:

General Liability : (a) activities performed by or on behalf of the Named Insured, (b) products and completed operations of the Named Insured, (c) premises owned, leased occupied or used by the Na med Insured, and/or (d) permits issued for operations performed by the Named Insured. {Note:

MEETS OR EXCEEDS ISO Form # CG 20 10 11 85}

Auto Liability : the ownership, operation, maintenance, use, loading or unloading of any auto owned, leased, hired or borrowed by the Named Insured, regardless of whether liability is attributable to the Named Insured or a combination of the Named Insured and the Additional Insured, its elected or appointed officers, officials, employees or volunteers.

Other:

Certificates of Insurance Required (no endorsement needed) (Check all that apply) Insurer Policy No.

Professional Liability:

PRIMARY/NON-CONTRIBUTORY: This insurance is primary and is not additional to or contributing with any other insurance carried by or for the benefit of Additional Insureds.

PROVISIONS REGARDING THE INSURED'S DUTIES AFTER ACCIDENT OR LOSS: Any failure to comply with reporting provisions of the policy shall not affect coverage provided to the Additional Insured, its elected or appointed officers, officials, employees, or volunteers.

CANCELLATION NOTICE. The insurance afforded by this policy shall not be suspended, voided, canceled, reduced in coverage or in limits except after thirty (30) days' prior written notice (ten (10) days if canceled due to non -payment) by regular mail return receipt requested has been given to the Additional Insured. Such notice shall be addressed as shown above.

WAIVER OF SUBROGATION: The insurer(s) named above agree to waive all rights of subrogation against the CITY, its elected or appointed officers, officials, agents, volunteers and employees for losses paid under the terms of this policy which arise from work performed by the Named Insured for the CITY.

Nothing herein contained shall vary, alter or extend any provision or condition of the Policy other than as above stated.

SIGNATURE OF INSURER OR AUTHORIZED REPRESENTATIVE OF THE INSURER

I, ______________________________________________________________(print/type name), warrant that I have authority to bind the above-named insurance company and by my signature hereon do so bind this company.

SIGNATURE OF AUTHORIZED REPRESENTATIVE (original signature required)

ORGANIZATION: TITLE:

ADDRESS:

TELEPHONE: ( ) DATE ISSUED:

DocuSign Envelope ID: E0BBC9CC-9BA6-4D65-B08E-751059A67B91

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DATE: June 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager

FROM: Kevin Ortiz, Management Analyst
DEPARTMENT: City Manager
SUBJECT: CONSIDERATION OF THE ADOPTION OF A RESOLUTION

GRANTING CONSENT TO THE CITY OF BURLINGAME TO

FORM THE SAN FRANCISCO PENINSULA TOURISM

MARKETING DISTRICT AND INCLUDE THE CITY OF FOSTER
CITY

RECOMMENDATION
It is recommended that the City Council adopt the attached resolution granting consent to the City of Burlingame to form the San Francisco Peninsula Tourism Marketing District (SFPTMD) and include the City of Foster City in the SFPTMD.

EXECUTIVE SUMMARY
In 2001, the San Mateo County Tourism Business Improvement District (SMCTBID) was formed pursuant to the Parking and Business Improvement Area Law of 1989 (89 Law) by City of Burlingame Ordinance No. 1648. At the January 2, 2001 City Council meeting, the City of Foster City City Council adopted Resolution No. 2001-6, which granted consent to the City of Burlingame to form the SMCTBID and for Foster City to be included within the boundaries of the SMCTBID. The San Mateo County/Silicon Valley Convention Bureau dba The San Francisco Peninsula (SFP) in addition to San Mateo County lodging businesses now seek to modernize the SMCTBID by forming a new District, the SFPTMD, pursuant to the Property and Business Improvement District Law of 1994.

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The SFPTMD is a benefit assessment district proposed to create a revenue source to help fund marketing and sales promotion efforts for San Francisco Peninsula area lodging businesses. This approach has been used successfully in other destination areas throughout the state to improve tourism and drive additional room nights to assessed lodging businesses. The proposed SFPTMD includes all lodging businesses located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County.

To ensure Foster City’s inclusion in the SFPTMD, it is recommended that the City Council adopt the attached resolution granting consent to the City of Burlingame to form the SFPTMD. Approval of the resolution will enable the City of Burlingame and the SFP to move forward with the SFPTMD formation process. Upon successful formation, the SFPTMD will be governed by the SFP, Management District Plan, and be facilitated by the City of Burlingame City Council.

BACKGROUND/ANALYSIS
On May 15, 2023, the City of Burlingame City Council adopted Resolution No. 050- 2023 (Attachment 2) requesting the consent of cities in San Mateo County, including the City of Foster City, to form the SFPTMD.

SFP and lodging business owners decided to pursue formation of the SFPTMD in order to create a revenue source devoted to marketing the San Francisco Peninsula area as a tourist, meeting, and event destination. If established, the SFPTMD would generate approximately $10,895,479 on an annual basis for promotion of travel and tourism specific to the San Francisco Peninsula area.

Tourism Marketing Districts
Tourism Marketing Districts (TMDs) utilize the efficiencies of private sector operation in the market-based promotion of tourism. These special assessment districts allow lodging business owners to organize their efforts to increase tourism. Lodging business owners within the TMD fund the TMD, and those funds are used to provide services that are desired by and benefit the lodging businesses within the TMD.

TMD benefits:
➢Funds cannot be diverted for other government programs; ➢They are customized to fit the needs of each destination; ➢They allow for a wide range of services; including: destination marketing, tourism promotion, and sales lead generation;
➢They are designed, created and governed by those who will pay the assessment; and
➢They provide a stable funding source for tourism promotion.

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In California, TMDs are primarily formed pursuant to the Property and Business Improvement District Law of 1994 (94 Law). This law allows for the creation of a special benefit assessment districts to raise funds within a specific geographic area. The key difference between TMDs and other special benefit assessment districts is that funds raised are returned to the private non-profit corporation governing the TMD.

Management District Plan
The SFPTMD Management District Plan (Attachment 3) includes the proposed boundary of the SFPTMD, a service plan and budget, and a proposed means of governance. The SFPTMD will include all lodging businesses located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County.

The annual assessment rate is one and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the SFPTMD’s boundaries. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews’ performance of their jobs for the airline, including layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty.

The proposed SFPTMD will have a five (5) year life, beginning October 1, 2023, or as soon as possible thereafter, and ending five (5) years from its start date. The assessment will be implemented beginning October 1, 2023, or as soon as possible thereafter. Once per year beginning on the anniversary of SFPTMD formation there is a thirty (30) day period in which business owners paying fifty percent (50%) or more of the assessment may protest and begin proceedings to terminate the SFPTMD.

The City of Burlingame shall be responsible for collecting the assessments on a monthly basis (including any delinquencies, penalties, and interest) from each lodging business located in the boundaries of the SFPTMD. The City of Burlingame shall take all reasonable efforts to collect the assessments from each lodging business. The City of Burlingame shall be paid a fee equal to one percent (1%) of the amount of assessment collected or a flat fee of $60,000, whichever is greater each year to cover its costs of collection and administration.

California Environmental Quality Act

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Not Applicable

FISCAL IMPACT
There is no immediate fiscal impact associated with the adoption of the attached resolution. Because the SFPTMD programs are intended to increase room night sales for assessed lodging businesses within the SFPTMD, there may be an increase in tax collections.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Smart Planning, Development, and the Local Economy
ATTACHMENTS:

Attachment 1 – Resolution
Attachment 2 – Adopted Resolution from the City of Burlingame Requesting Consent from Cities in San Mateo County, including the City of Foster City, to form the SFPTMD Attachment 3 – SFPTMD Management District Plan

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RESOLUTION NO.____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY, STATE OF

CALIFORNIA, GRANTING CONSENT TO THE CITY OF BURLINGAME TO FORM THE

SAN FRANCISCO PENINSULA TOURISM MARKETING DISTRICT (SFPTMD)

CITY OF FOSTER CITY
WHEREAS, in 2001, the San Mateo County Tourism Business Improvement District (SMCTBID) was formed pursuant to the Parking and Business Improvement Area Law of 1989 (89 Law) by City of Burlingame Ordinance No. 1648; and WHEREAS, the City of Foster City granted consent to the City of Burlingame to be included within the boundaries of the SMCTBID by Foster City City Council Resolution No. 2001-6; and
WHEREAS, the City of Burlingame, San Mateo County/Silicon Valley Convention and Visitors Bureau dba The San Francisco Peninsula (SFP), and San Mateo County lodging businesses seek to modernize the SMCTBID by forming a new District, the San Francisco Peninsula Tourism Marketing District (SFPTMD), pursuant to the Property and Business Improvement District Law of 1994; and
WHEREAS, the Property and Business Improvement Law of 1994, Streets and Highways Code § 36600 et seq., authorizes the City of Burlingame to establish business improvement districts for the purposes of driving increased business sales directly to payors; and
WHEREAS, the City Council of the City of Burlingame has requested consent to form the SFPTMD in the City of Foster City with adoption of Burlingame City Council Resolution No. 050-2023, dated May 15, 2023.

NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Foster City, that:

Section 1: The above recitals are true and correct.

Section 2: The City of Burlingame is hereby granted consent to include the City of Foster City in the SFPTMD, for the formation of the SFPTMD and future renewals.

Section 3: The Clerk of the City of Foster City is hereby directed to transmit a certified copy of this Resolution to the Clerk of the City of Burlingame.

Section 4: This Resolution is effective upon its adoption.

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PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the regular meeting held on the 20th day of June, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

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6.9 Attachment 2 - Adopted Resolution from the City of Burlingame Requesting Consent to Form the SFPTMD

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6.9 Attachment 2 - Adopted Resolution from the City of Burlingame Requesting Consent to Form the SFPTMD

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SAN FRANCISCO PENINSULA TOURISM

MARKETING DISTRICT

MANAGEMENT DISTRICT PLAN
Prepared pursuant to the Property and Business Improvement District Law of 1994, Streets and Highways Code section 36600 et seq. January 23, 2023 2023-2028

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Table of Contents I. OVERVIEW .............................................................................................................................................. 3 II. BACKGROUND ....................................................................................................................................... 5 III. BOUNDARY ............................................................................................................................................. 6 IV. ASSESSMENT BUDGET AND SERVICES ............................................................................................ 7 A. ANNUAL SERVICE PLAN ................................................................................................................................... 7 B. ANNUAL BUDGET ............................................................................................................................................ 9 C. CALIFORNIA CONSTITUTIONAL COMPLIANCE .................................................................................................. 9 D. ASSESSMENT .................................................................................................................................................. 11 E. PENALTIES AND INTEREST ............................................................................................................................. 12 F. TIME AND MANNER FOR COLLECTING ASSESSMENTS .................................................................................... 13 V. GOVERNANCE ..................................................................................................................................... 14 A. OWNERS’ ASSOCIATION ................................................................................................................................. 14 B. BROWN ACT AND CALIFORNIA PUBLIC RECORDS ACT COMPLIANCE ............................................................. 14 C. ANNUAL REPORT ........................................................................................................................................... 14 APPENDIX 1 – LAW ........................................................................................................................................ 15 APPENDIX 2 – ASSESSED BUSINESSES ..................................................................................................... 26 APPENDIX 3 – BENEFITS BY BUSINESS CATEGORY ............................................................................. 31 APPENDIX 4 – SMG CONSULTING ANALYSIS .......................................................................................... 33 Prepared by Civitas
(800)999-7781 www.civitasadvisors.com

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SFPTMD Management District Plan 3 January 23, 2023
I. OVERVIEW Developed by the San Mateo County/Silicon Valley Convention and Visitors Bureau dba The San Francisco Peninsula (SFP) and San Mateo County lodging businesses, the San Francisco Peninsula Tourism Marketing District (SFPTMD) is an assessment district proposed to provide specific benefits to payors, by funding marketing and sales promotion efforts for assessed businesses. This approach has been used successfully in other destination areas throughout the country to provide the benefit of additional room night sales directly to payors. In 2001, the San Mateo County Tourism Business Improvement District (SMCTBID) was formed pursuant to the Parking and Business Improvement Area Law of 1989 (89 Law). This effort seeks to modernize the SMCTBID by disestablishing the 89 Law District and forming a new District, the SFPTMD, pursuant to the Property and Business Improvement District Law of 1994 (94 Law). Location: The SFPTMD includes all lodging businesses, existing and in the future, located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County, as shown on the map in Section III. Services: The SFPTMD is designed to provide specific benefits directly to payors by increasing awareness and demand for room night sales, meetings, and conventions. Sales and marketing programs will increase demand for overnight tourism and market payors as tourist, meeting and event destinations, thereby increasing demand for room night sales, meetings, and conventions. Budget: The total SFPTMD annual assessment budget for the initial year of its five (5) year operation is anticipated to be approximately $10,895,479. A similar budget is expected to apply to subsequent years, but this budget is expected to fluctuate as room sales do. Cost: The annual assessment rate is one- and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the SFPTMD’s boundaries. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews’ performance of their jobs for the airline, including layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty. Collection: The City of Burlingame shall be responsible for collecting the assessments on a monthly basis (including any delinquencies, penalties and interest) from each lodging business located in the boundaries of the SFPTMD. The City shall take all reasonable efforts to collect the assessments from each lodging business.

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SFPTMD Management District Plan 4 January 23, 2023
Duration: The SFPTMD will have a five (5) year life, beginning October 1, 2023, or as soon as possible thereafter, and ending five (5) years from its start date. After five (5) years, the SFPTMD may be renewed pursuant to the 94 Law if business owners support continuing the SFPTMD programs. Once per year, beginning on the anniversary of SFPTMD formation, there is a thirty (30) day period in which owners paying fifty percent (50%) or more of the assessment may protest and initiate a hearing on SFPTMD termination. Management: The San Mateo County/Silicon Valley Convention and Visitors Bureau dba The San Francisco Peninsula (SFP) shall serve as the SFPTMD’s Owners’ Association. The Owners’ Association is charged with managing funds and implementing programs in accordance with this Plan, and must provide annual reports to the Burlingame City Council. The SFP shall create a SFPTMD Committee tasked with determining how SFPTMD funds are spent, within the designated programs in this Plan, subject to final approval by the SFP Board. The SFPTMD Committee shall include lodging business owners or representatives paying the SFPTMD assessment.

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SFPTMD Management District Plan 5 January 23, 2023
II. BACKGROUND TMDs are an evolution of the traditional Business Improvement District. The first TMD was formed in West Hollywood, California in 1989. Since then, over 100 California destinations have followed suit. In recent years, other states have begun adopting the California model – Massachusetts, Montana, South Dakota, Washington, Colorado, Texas and Louisiana have adopted TMD laws. Several other states are in the process of adopting their own legislation. The cities of Wichita, Kansas and Newark, New Jersey used an existing business improvement district law to form a TMD. And, some cities, like Portland, Oregon and Memphis, Tennessee have utilized their home rule powers to create TMDs without a state law. California’s TMDs collectively raise over $300 million annually for local destination marketing. With competitors raising their budgets, and increasing rivalry for visitor dollars, it is important that San Francisco Peninsula tourism businesses invest in stable, commerce-specific marketing programs. TMDs utilize the efficiencies of private sector operation in the market-based promotion of tourism districts. TMDs allow tourism business owners to organize their efforts to increase commerce. Tourism business owners within the TMD pay an assessment and those funds are used to provide services that increase commerce. In California, most TMDs are formed pursuant to the Property and Business Improvement District Law of 1994. This law allows for the creation of a benefit assessment district to raise funds within a specific geographic area. The key difference between TMDs and other benefit assessment districts is that funds raised are returned to the private non-profit corporation governing the district. There are many benefits to TMDs: • Funds must be spent on services and improvements that provide a specific benefit only to those who pay; • Funds cannot be diverted to general government programs; • They are customized to fit the needs of payors in each destination; • They allow for a wide range of services; • They are designed, created and governed by those who will pay the assessment; and • They provide a stable, long-term funding source for tourism promotion.

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SFPTMD Management District Plan 6 January 23, 2023
III. BOUNDARY The SFPTMD includes all lodging businesses, existing and in the future, located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County, illustrated by the map below. “Lodging business” means: any hotel, motel, inn, bed and breakfast, or other similar structure or portion thereof that is rented for dwelling, lodging, or sleeping purposes on a transient basis. Tourist home or house, studio hotel, bachelor hotel, lodginghouse, roominghouse, apartment house, dormitory, public or private club, mobile home or house trailer at a fixed location, are not included in the definition of “lodging business.” The boundary is shown on the map below. A list of lodging businesses proposed to be assessed in the SFPTMD can be found in Appendix 2.

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SFPTMD Management District Plan 7 January 23, 2023
IV. ASSESSMENT BUDGET AND SERVICES A. Annual Service Plan Assessment funds will be spent to provide specific benefits conferred or privileges granted directly to the payors that are not provided to those not charged, and which do not exceed the reasonable cost to the City of conferring the benefits or granting the privileges. The privileges and services provided with the SFPTMD funds are sales and marketing programs available only to assessed businesses. A service plan assessment budget has been developed to deliver services that benefit the assessed businesses. A detailed annual assessment budget will be developed and approved by the SFP. The table below illustrates the initial annual assessment budget allocations. These activities and allocations will also apply in subsequent years. The total initial assessment budget is $10,895,479.

Although actual revenues will fluctuate due to market conditions, the proportional allocations of the budget shall remain the same. However, the City and the SFP board shall have the authority to adjust budget allocations between the categories by no more than twenty (20%) of the total budget per year. A description of the proposed improvements and activities for the initial year of operation is below. The same activities are proposed for subsequent years. In the event of a legal challenge against the SFPTMD, any and all assessment funds may be used for the costs of defending the SFPTMD. In the first year of operation, the costs of creating the SFPTMD may be repaid by deducting repayment funds proportionally from budget categories. Each budget category includes all costs related to providing that service. For example, the sales and marketing budget includes the cost of staff time dedicated to overseeing and implementing the sales and marketing program. Staff time dedicated purely to administrative tasks is allocated to the administrative portion of the budget. The costs of an individual staff member may be allocated to multiple budget categories. The staffing levels necessary to provide the services below will be determined by the SFP Board on an as- needed basis.

Sales, Marketing, & Advocacy, $9,805,931 , 90%
Administration & Operations, $871,638 , 8%Contingency/Reserve, $108,955 , 1%City Collection Fee,$108,955 , 1% Initial Annual Assessment Budget: $10,895,479

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SFPTMD Management District Plan 8 January 23, 2023
Sales, Marketing, & Advocacy A sales and marketing program will promote assessed businesses as tourist, meeting, and event destinations. The sales and marketing program will have a central theme of promoting San Francisco Peninsula as a desirable place for overnight visits. The program will have the goal of increasing overnight visitation and room night sales at assessed businesses, and may include the following activities: • Funds to support group business to offset costs within the destination, thereby generating room nights for assessed businesses; • Payment of bid fees, incentives or other costs associated with bringing large scale events to the destination that generate room nights for assessed businesses; • Funds to support events and/or local partnerships that increase the public notoriety of the destination as a tourist, meetings, or event destination – thereby increasing consumer demand for assessed businesses; • Support of public relation strategies that increase the profile of the destination as a tourist, meetings, or event destination – thereby increasing consumer demand for assessed businesses; • Strategic partnerships, sponsorships, or other alliances that reinforce the destination within the travel marketplace and position the San Francisco Peninsula as a destination of choice for meetings, events, and leisure travel to assessed businesses; • Internet marketing efforts to increase awareness and optimize internet presence to drive overnight visitation and room sales to assessed businesses; • Print ads in magazines and newspapers, television ads, and radio ads targeted at potential visitors to drive overnight visitation and room sales to assessed businesses; • Attendance of trade shows to promote assessed businesses; • Familiarization tours of the destination and assessed businesses; • Preparation and production of collateral promotional materials such as brochures, flyers and maps featuring assessed businesses; • Attendance of professional industry conferences and affiliation events to promote assessed businesses; • Lead generation activities designed to attract tourists and group events to assessed businesses; • Director of Sales and General Manager meetings to plan and coordinate tourism promotion efforts for assessed businesses; • Education of hospitality staff on service and safety (related to alcohol and food) designed to create a visitor experience that will bring repeat visits to assessed businesses; • Education of lodging business management and the Owners’ Association on advocacy and marketing strategies best suited to meet assessed businesses’ needs; and • Other activities that increase the profile and notoriety of The San Francisco Peninsula as an overnight travel destination and promote greater room night sales for assessed businesses. Administration & Operations The administration and operations portion of the budget shall be utilized for administrative staffing costs, office costs, and other general administrative costs such as insurance, legal, and accounting fees. Contingency/Reserve The budget includes a contingency line item to account for uncollected assessments, if any. If there are contingency funds collected, they may be held in a reserve fund or utilized for other program, administration or renewal costs at the discretion of the SFP Board. Policies relating to contributions to the reserve fund, the target amount of the reserve fund, and expenditure of monies from the reserve

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SFPTMD Management District Plan 9 January 23, 2023
fund shall be set by the SFP Board. Contingency/reserve funds may be spent on SFPTMD programs or administrative and renewal costs in such proportions as determined by the SFP Board. The reserve fund may be used for the costs of renewing the SFPTMD. City Collection Fee As lead agency, the City of Burlingame shall retain a fee equal to one percent (1%) of the amount of assessment collected or a flat fee of $60,000, whichever is greater each year, to cover their costs of collection and administration. B. Annual Budget The total five (5) year improvement and service plan budget is projected at approximately $10,895,479 annually, or $64,132,237 through 2028. A similar budget is expected to apply to subsequent years, but this budget is expected to fluctuate as room sales do. The following chart has been prepared based on a five-year projection developed by SMG Consulting. The full report can be found in Appendix 4. Fiscal Year Sales, Marketing, & Advocacy Administration & Operations Contingency / Reserve City Collection Fee Total 2023-24 $9,805,931 $871,638 $108,955 $108,955 $10,895,479 2024-25 $10,612,716 $943,353 $117,919 $117,919 $11,791,907 2025-26 $11,437,986 $1,016,710 $127,089 $127,089 $12,708,873 2026-27 $12,422,508 $1,104,223 $138,028 $138,028 $13,802,787 2027-28 $13,439,872 $1,194,655 $149,332 $149,332 $14,933,191 Total $57,719,013 $5,130,579 $641,322 $641,322 $64,132,237 C. California Constitutional Compliance The SFPTMD assessment is not a property-based assessment subject to the requirements of Proposition 218. Courts have found Proposition 218 limited the term ‘assessments’ to levies on real property.1 Rather, the SFPTMD assessment is a business-based assessment, and is subject to Proposition 26. Pursuant to Proposition 26 all levies are a tax unless they fit one of seven exceptions. Two of these exceptions apply to the SFPTMD, a “specific benefit” and a “specific government service.” Both require that the costs of benefits or services do not exceed the reasonable costs to the City of conferring the benefits or providing the services. 1. Specific Benefit Proposition 26 requires that assessment funds be expended on, “a specific benefit conferred or privilege granted directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of conferring the benefit or granting the 1 Jarvis v. the City of San Diego 72 Cal App. 4th 230

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SFPTMD Management District Plan 10 January 23, 2023
privilege.”2 The services in this Plan are designed to provide targeted benefits directly to assessed businesses, and are intended only to provide benefits and services directly to those businesses paying the assessment. These services are tailored not to serve the general public, businesses in general, or parcels of land, but rather to serve the specific businesses within the SFPTMD. The activities described in this Plan are specifically targeted to increase demand for room night sales for assessed lodging businesses within the boundaries of the SFPTMD, and are narrowly tailored. SFPTMD funds will be used exclusively to provide the specific benefit of increased demand for room night sales directly to the assessees. Assessment funds shall not be used to feature non-assessed lodging businesses in SFPTMD programs, or to directly generate sales for non-assessed businesses. The activities paid for from assessment revenues are business services constituting and providing specific benefits to the assessed businesses. Nothing in this Plan limits the ability of the SFP Corporation to enter into private contracts with non-assessed lodging businesses for the provision of services to those businesses. The assessment imposed by this SFPTMD is for a specific benefit conferred directly to the payors that is not provided to those not charged. The specific benefit conferred directly to the payors is an increase in demand for room night sales. The specific benefit of an increase in demand for room night sales for assessed lodging businesses will be provided only to lodging businesses paying the district assessment, with marketing and sales programs promoting lodging businesses paying the SFPTMD assessment. The marketing and sales programs will be designed to increase room night sales at each assessed lodging businesses. Because they are necessary to provide the marketing and sales programs that specifically benefit the assessed lodging businesses, the administration and contingency services also provide the specific benefit of increased demand for room night sales to the assessed lodging businesses. Although the SFPTMD, in providing specific benefits to payors, may produce incidental benefits to non-paying businesses, the incidental benefit does not preclude the services from being considered a specific benefit. The legislature has found that, “A specific benefit is not excluded from classification as a ‘specific benefit’ merely because an indirect benefit to a non-payor occurs incidentally and without cost to the payor as a consequence of providing the specific benefit to the payor.”3 2. Specific Government Service The assessment may also be utilized to provide, “a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service or product.”4 The legislature has recognized that marketing and promotions services like those to be provided by the SFPTMD are government services within the meaning of Proposition 265. Further, the legislature has determined that “a specific government service is not excluded from classification as a ‘specific government service’ merely because an indirect benefit to a nonpayor occurs incidentally and without cost to the payor as a consequence of providing the specific government service to the payor.”6 3. Reasonable Cost SFPTMD services will be implemented carefully to ensure they do not exceed the reasonable cost of such services. The full amount assessed will be used to provide the services described herein. Funds will be managed by the SFP, and reports submitted on an annual basis to the City. Only assessed 2 Cal. Const. art XIII C § 1(e)(1) 3 Government Code § 53758(a) 4 Cal. Const. art XIII C § 1(e)(2) 5 Government Code § 53758(b) 6 Government Code § 53758(b)

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lodging businesses will be featured in marketing materials, receive sales leads generated from SFPTMD-funded activities, be featured in advertising campaigns, and benefit from other SFPTMD-funded services. Non-assessed lodging businesses will not receive these, nor any other, SFPTMD-funded services and benefits. The SFPTMD-funded programs are all targeted directly at and feature only assessed businesses. It is, however, possible that there will be a spill-over benefit to non-assessed businesses. If non-assessed lodging businesses receive incremental room nights, that portion of the promotion or program generating those room nights shall be paid with non-SFPTMD funds. SFPTMD funds shall only be spent to benefit the assessed businesses, and shall not be spent on that portion of any program which directly generates incidental room nights for non-assessed businesses. D. Assessment The annual assessment rate is one- and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the SFPTMD’s boundaries. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews’ performance of their jobs for the airline, including layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty. The services provided in the SFPTMD are all targeted to benefit payors, however, not all programs benefit payors equally. The determination of the assessment rates of one- and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the SFPTMD’s boundaries, was calculated based on benefit received by payors. SMG Consulting was engaged to conduct a Hotel Revenue Proportionality Estimate analysis to quantify the estimated benefit the lodging business types will receive from SFPTMD services. By analyzing the projected number of rooms sold and the total amount of revenue estimated to be generated from sales and marketing programs, SMG Consulting found that properties with 5,000 square feet or more of dedicated meeting space will receive approximately double the amount of benefit to all other lodging businesses. The SFPTMD Sales, Marketing, and Advocacy program included in the budget has services that are intended to drive convention and meetings to the SFPTMD. Since lodging businesses with 5,000 square feet or more of dedicated meeting space are uniquely suited to accommodate large conventions and will benefit from overnight stays as a result of SFPTMD services intended to bring such business activity to the SFPTMD, they are assessed at a higher rate than other lodging businesses in the SFPTMD. The term “dedicated meeting space” as used herein means: a permanent room or space whose primary use is dedicated for group and social meetings, meals, and/or functions. The space has been designed for and is marketed and sold as group or event function space. The term “gross sleeping room rental revenue” as used herein means: the consideration charged, whether or not received, for the occupancy of space in a lodging business valued in money, whether to be received in money, goods, labor or otherwise, including all receipts, cash, credits and property and services of any kind or nature, without any deduction therefrom whatsoever. Gross sleeping room rental revenue shall not include any federal, state, or local taxes collected, including but not

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limited to transient occupancy taxes. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews’ performance of their jobs for the airline, including layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty. The assessment is levied upon and a direct obligation of the assessed lodging business. However, the assessed lodging business may, at its discretion, pass the assessment on to transients. The amount of assessment, if passed on to each transient, shall be disclosed in advance and separately stated from the amount of rent charged and any other applicable taxes, and each transient shall receive a receipt for payment from the business. If the SFPTMD assessment is identified separately it shall be disclosed as the “SFPTMD Assessment.” As an alternative, the disclosure may include the amount of the SFPTMD assessment and the amount of the assessment imposed pursuant to the California Tourism Marketing Act, Government Code §13995 et seq. and shall be disclosed as the “Tourism Assessment.” The assessment is imposed solely upon, and is the sole obligation of the assessed lodging business even if it is passed on to transients. The assessment shall not be considered revenue for any purpose, including calculation of transient occupancy taxes. Bonds shall not be issued. E. Penalties and Interest The SFPTMD shall reimburse the City of Burlingame for any costs associated with collecting unpaid assessments. If sums in excess of the delinquent SFPTMD assessment are sought to be recovered in the same collection action by the City, the SFPTMD shall bear its pro rata share of such collection costs. Assessed businesses which are delinquent in paying the assessment shall be responsible for paying: 1. Original Delinquency: Any lodging business that fails to remit any assessment imposed within the time required shall pay a penalty of five percent (5%) of the amount of the assessment in addition to the amount of the assessment. 2. Continued Delinquency: Any lodging business that fails to remit any delinquent remittance on or before a period of fifteen (15) days following the date on which the remittance first became delinquent shall pay a second delinquency penalty of five percent (5%) of the amount of the assessment in addition to the amount of the assessment and the five percent (5%) penalty first imposed. An additional penalty of five percent (5%) shall be paid for each fifteen (15) days thereafter which the remittance is delinquent. 3. Fraud: If the City determines that the nonpayment of any remittance due under this chapter is due to fraud, a penalty of twenty-five percent (25%) of the amount of the assessment shall be added thereto in addition to the penalties stated in subsections (1) and (2) of this section. 4. Interest: In addition to the penalties imposed, any lodging business that fails to remit any assessment imposed shall pay interest at the rate of one percent (1%) per month or fraction thereof on the amount of the assessment, exclusive of penalties, from the date on which the remittance first became delinquent until paid.

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F. Time and Manner for Collecting Assessments The SFPTMD assessment will be implemented beginning October 1, 2023, or as soon as possible thereafter, and ending five (5) years from its start date. The City of Burlingame shall be responsible for collecting the assessment on a monthly basis, (including any delinquencies, penalties and interest) from each lodging business located in the boundaries of the SFPTMD. The City shall take all reasonable efforts to collect the assessments from each lodging business. The City shall forward the assessments collected to the Owners’ Association.

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V. GOVERNANCE A. Owners’ Association The Burlingame City Council, through adoption of this Management District Plan, has the right, pursuant to Streets and Highways Code §36651, to identify the body that shall implement the proposed program, which shall be the Owners’ Association of the SFPTMD as defined in Streets and Highways Code §36612. The San Francisco Peninsula (SFP) will serve as the SFPTMD’s Owners’ Association. The Owners’ Association is charged with managing funds and implementing programs in accordance with the Management District Plan, and must provide annual reports to Burlingame City Council. The SFP shall create a SFPTMD Committee tasked with determining how SFPTMD funds are spent, within the designated programs in this Plan, subject to final approval by the SFP Board. The SFPTMD Committee shall include lodging business owners or representatives paying the SFPTMD assessment. B. Brown Act and California Public Records Act Compliance An Owners’ Association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. The Owners’ Association is, however, subject to government regulations relating to transparency, namely the Ralph M. Brown Act and the California Public Records Act. These regulations are designed to promote public accountability. The Owners’ Association acts as a legislative body under the Ralph M. Brown Act (Government Code §54950 et seq.). Thus, meetings of the SFP board and certain committees must be held in compliance with the public notice and other requirements of the Brown Act. The Owners’ Association is also subject to the record keeping and disclosure requirements of the California Public Records Act. Accordingly, the Owners’ Association shall publicly report any action taken and the vote or abstention on that action of each member present for the action. C. Annual Report The SFP shall present an annual report at the end of each year of operation to the City Council pursuant to Streets and Highways Code §36650 (see Appendix 1). The annual report shall include: • Any proposed changes in the boundaries of the improvement district or in any benefit zones or classification of businesses within the district. • The improvements and activities to be provided for that fiscal year. • An estimate of the cost of providing the improvements and the activities for that fiscal year. • The method and basis of levying the assessment in sufficient detail to allow each business owner to estimate the amount of the assessment to be levied against his or her business for that fiscal year. • The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal year. • The estimated amount of any contributions to be made from sources other than assessments levied pursuant to this part.

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APPENDIX 1 – LAW *** THIS DOCUMENT IS CURRENT THROUGH THE 2022 SUPPLEMENT *** (ALL 2021 LEGISLATION) STREETS AND HIGHWAYS CODE DIVISION 18. PARKING PART 7. PROPERTY AND BUSINESS IMPROVEMENT DISTRICT LAW OF 1994 CHAPTER 1. General Provisions ARTICLE 1. Declarations 36600. Citation of part This part shall be known and may be cited as the “Property and Business Improvement District Law of 1994.” 36601. Legislative findings and declarations; Legislative guidance The Legislature finds and declares all of the following: (a) Businesses located and operating within business districts in some of this state’s communities are economically disadvantaged, are underutilized, and are unable to attract customers due to inadequate facilities, services, and activities in the business districts. (b) It is in the public interest to promote the economic revitalization and physical maintenance of business districts in order to create jobs, attract new businesses, and prevent the erosion of the business districts. (c) It is of particular local benefit to allow business districts to fund business related improvements, maintenance, and activities through the levy of assessments upon the businesses or real property that receive benefits from those improvements. (d) Assessments levied for the purpose of conferring special benefit upon the real property or a specific benefit upon the businesses in a business district are not taxes for the general benefit of a city, even if property, businesses, or persons not assessed receive incidental or collateral effects that benefit them. (e) Property and business improvement districts formed throughout this state have conferred special benefits upon properties and businesses within their districts and have made those properties and businesses more useful by providing the following benefits: (1) Crime reduction. A study by the Rand Corporation has confirmed a 12-percent reduction in the incidence of robbery and an 8-percent reduction in the total incidence of violent crimes within the 30 districts studied. (2) Job creation. (3) Business attraction. (4) Business retention. (5) Economic growth. (6) New investments. (f) With the dissolution of redevelopment agencies throughout the state, property and business improvement districts have become even more important tools with which communities can combat blight, promote economic opportunities, and create a clean and safe environment. (g) Since the enactment of this act, the people of California have adopted Proposition 218, which added Article XIII D to the Constitution in order to place certain requirements and restrictions on the formation of, and activities, expenditures, and assessments by property-based districts. Article XIII D of the Constitution provides that property-based districts may only levy assessments for special benefits. (h) The act amending this section is intended to provide the Legislature’s guidance with regard to this act, its interaction with the provisions of Article XIII D of the Constitution, and the determination of special benefits in property-based districts. (1) The lack of legislative guidance has resulted in uncertainty and inconsistent application of this act, which discourages the use of assessments to fund needed improvements, maintenance, and activities in property-based districts, contributing to blight and other underutilization of property. (2) Activities undertaken for the purpose of conferring special benefits upon property to be assessed inherently produce incidental or collateral effects that benefit property or persons not assessed. Therefore, for special benefits to exist as a separate and distinct category from general benefits, the incidental or collateral effects of those special benefits are inherently part of those special benefits. The

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mere fact that special benefits produce incidental or collateral effects that benefit property or persons not assessed does not convert any portion of those special benefits or their incidental or collateral effects into general benefits. (3) It is of the utmost importance that property-based districts created under this act have clarity regarding restrictions on assessments they may levy and the proper determination of special benefits. Legislative clarity with regard to this act will provide districts with clear instructions and courts with legislative intent regarding restrictions on property-based assessments, and the manner in which special benefits should be determined. 36602. Purpose of part The purpose of this part is to supplement previously enacted provisions of law that authorize cities to levy assessments within property and business improvement districts, to ensure that those assessments conform to all constitutional requirements and are determined and assessed in accordance with the guidance set forth in this act. This part does not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes. 36603. Preemption of authority or charter city to adopt ordinances levying assessments Nothing in this part is intended to preempt the authority of a charter city to adopt ordinances providing for a different method of levying assessments for similar or additional purposes from those set forth in this part. A property and business improvement district created pursuant to this part is expressly exempt from the provisions of the Special Assessment Investigation, Limitation and Majority Protest Act of 1931 (Division 4 (commencing with Section 2800)). 36603.5. Part prevails over conflicting provisions Any provision of this part that conflicts with any other provision of law shall prevail over the other provision of law, as to districts created under this part. 36604. Severability This part is intended to be construed liberally and, if any provision is held invalid, the remaining provisions shall remain in full force and effect. Assessments levied under this part are not special taxes. ARTICLE 2. Definitions 36606. “Activities” “Activities” means, but is not limited to, all of the following that benefit businesses or real property in the district: (a) Promotion of public events. (b) Furnishing of music in any public place. (c) Promotion of tourism within the district. (d) Marketing and economic development, including retail retention and recruitment. (e) Providing security, sanitation, graffiti removal, street and sidewalk cleaning, and other municipal services supplemental to those normally provided by the municipality. (f) Other services provided for the purpose of conferring special benefit upon assessed real property or specific benefits upon assessed businesses located in the district. 36606.5. “Assessment” “Assessment” means a levy for the purpose of acquiring, constructing, installing, or maintaining improvements and providing activities that will provide certain benefits to properties or businesses located within a property and business improvement district. 36607. “Business” “Business” means all types of businesses and includes financial institutions and professions. 36608. “City”

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“City” means a city, county, city and county, or an agency or entity created pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code, the public member agencies of which includes only cities, counties, or a city and county, or the State of California. 36609. “City council” “City council” means the city council of a city or the board of supervisors of a county, or the agency, commission, or board created pursuant to a joint powers agreement and which is a city within the meaning of this part. 36609.4. “Clerk” “Clerk” means the clerk of the legislative body. 36609.5. “General benefit” “General benefit” means, for purposes of a property-based district, any benefit that is not a “special benefit” as defined in Section 36615.5. 36610. “Improvement” “Improvement” means the acquisition, construction, installation, or maintenance of any tangible property with an estimated useful life of five years or more including, but not limited to, the following: (a) Parking facilities. (b) Benches, booths, kiosks, display cases, pedestrian shelters and signs. (c) Trash receptacles and public restrooms. (d) Lighting and heating facilities. (e) Decorations. (f) Parks. (g) Fountains. (h) Planting areas. (i) Closing, opening, widening, or narrowing of existing streets. (j) Facilities or equipment, or both, to enhance security of persons and property within the district. (k) Ramps, sidewalks, plazas, and pedestrian malls. (l) Rehabilitation or removal of existing structures. 36611. “Management district plan”; “Plan” “Management district plan” or “plan” means a proposal as defined in Section 36622. 36612. “Owners’ association” “Owners’ association” means a private nonprofit entity that is under contract with a city to administer or implement improvements, maintenance, and activities specified in the management district plan. An owners’ association may be an existing nonprofit entity or a newly formed nonprofit entity. An owners’ association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. Notwithstanding this section, an owners’ association shall comply with the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), at all times when matters within the subject matter of the district are heard, discussed, or deliberated, and with the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code), for all records relating to activities of the district. 36614. “Property” “Property” means real property situated within a district. 36614.5. “Property and business improvement district”; “District” “Property and business improvement district,” or “district,” means a property and business improvement district established pursuant to this part.

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36614.6. “Property-based assessment” “Property-based assessment” means any assessment made pursuant to this part upon real property. 36614.7. “Property-based district” “Property-based district” means any district in which a city levies a property-based assessment. 36615. “Property owner”; “Business owner”; “Owner” “Property owner” means any person shown as the owner of land on the last equalized assessment roll or otherwise known to be the owner of land by the city council. “Business owner” means any person recognized by the city as the owner of the business. “Owner” means either a business owner or a property owner. The city council has no obligation to obtain other information as to the ownership of land or businesses, and its determination of ownership shall be final and conclusive for the purposes of this part. Wherever this part requires the signature of the property owner, the signature of the authorized agent of the property owner shall be sufficient. Wherever this part requires the signature of the business owner, the signature of the authorized agent of the business owner shall be sufficient. 36615.5. “Special benefit” “Special benefit” means, for purposes of a property-based district, a particular and distinct benefit over and above general benefits conferred on real property located in a district or to the public at large. Special benefit includes incidental or collateral effects that arise from the improvements, maintenance, or activities of property-based districts even if those incidental or collateral effects benefit property or persons not assessed. Special benefit excludes general enhancement of property value. 36616. “Tenant” “Tenant” means an occupant pursuant to a lease of commercial space or a dwelling unit, other than an owner. ARTICLE 3. Prior Law 36617. Alternate method of financing certain improvements and activities; Effect on other provisions This part provides an alternative method of financing certain improvements and activities. The provisions of this part shall not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes. Every improvement area established pursuant to the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500) of this division) is valid and effective and is unaffected by this part. CHAPTER 2. Establishment 36620. Establishment of property and business improvement district A property and business improvement district may be established as provided in this chapter. 36620.5. Requirement of consent of city council A county may not form a district within the territorial jurisdiction of a city without the consent of the city council of that city. A city may not form a district within the unincorporated territory of a county without the consent of the board of supervisors of that county. A city may not form a district within the territorial jurisdiction of another city without the consent of the city council of the other city. 36621. Initiation of proceedings; Petition of property or business owners in proposed district (a) Upon the submission of a written petition, signed by the property or business owners in the proposed district who will pay more than 50 percent of the assessments proposed to be levied, the city council may initiate proceedings to form a district by the adoption of a resolution expressing its intention to form a district. The amount of assessment attributable to property or a business owned by the same property or business owner that is in excess of 40 percent of the amount of all assessments proposed to be levied, shall not be included in

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determining whether the petition is signed by property or business owners who will pay more than 50 percent of the total amount of assessments proposed to be levied. (b) The petition of property or business owners required under subdivision (a) shall include a summary of the management district plan. That summary shall include all of the following: (1) A map showing the boundaries of the district. (2) Information specifying where the complete management district plan can be obtained. (3) Information specifying that the complete management district plan shall be furnished upon request. (c) The resolution of intention described in subdivision (a) shall contain all of the following: (1) A brief description of the proposed improvements, maintenance, and activities, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property or businesses within the district, a statement as to whether bonds will be issued, and a description of the exterior boundaries of the proposed district, which may be made by reference to any plan or map that is on file with the clerk. The descriptions and statements do not need to be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements, maintenance, and activities, and the location and extent of the proposed district. (2) A time and place for a public hearing on the establishment of the property and business improvement district and the levy of assessments, which shall be consistent with the requirements of Section 36623. 36622. Contents of management district plan The management district plan shall include, but is not limited to, all of the following: (a) If the assessment will be levied on property, a map of the district in sufficient detail to locate each parcel of property and, if businesses are to be assessed, each business within the district. If the assessment will be levied on businesses, a map that identifies the district boundaries in sufficient detail to allow a business owner to reasonably determine whether a business is located within the district boundaries. If the assessment will be levied on property and businesses, a map of the district in sufficient detail to locate each parcel of property and to allow a business owner to reasonably determine whether a business is located within the district boundaries. (b) The name of the proposed district. (c) A description of the boundaries of the district, including the boundaries of benefit zones, proposed for establishment or extension in a manner sufficient to identify the affected property and businesses included, which may be made by reference to any plan or map that is on file with the clerk. The boundaries of a proposed property assessment district shall not overlap with the boundaries of another existing property assessment district created pursuant to this part. This part does not prohibit the boundaries of a district created pursuant to this part to overlap with other assessment districts established pursuant to other provisions of law, including, but not limited to, the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500)). This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with another business assessment district created pursuant to this part. This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with a property assessment district created pursuant to this part. (d) The improvements, maintenance, and activities proposed for each year of operation of the district and the maximum cost thereof. If the improvements, maintenance, and activities proposed for each year of operation are the same, a description of the first year’s proposed improvements, maintenance, and activities and a statement that the same improvements, maintenance, and activities are proposed for subsequent years shall satisfy the requirements of this subdivision. (e) The total annual amount proposed to be expended for improvements, maintenance, or activities, and debt service in each year of operation of the district. If the assessment is levied on businesses, this amount may be estimated based upon the assessment rate. If the total annual amount proposed to be expended in each year of operation of the district is not significantly different, the amount proposed to be expended in the initial year and a statement that a similar amount applies to subsequent years shall satisfy the requirements of this subdivision. (f) The proposed source or sources of financing, including the proposed method and basis of levying the assessment in sufficient detail to allow each property or business owner to calculate the amount of the assessment to be levied against his or her property or business. The plan also shall state whether bonds will be issued to finance improvements. (g) The time and manner of collecting the assessments. (h) The specific number of years in which assessments will be levied. In a new district, the maximum number of years shall be five. Upon renewal, a district shall have a term not to exceed 10 years. Notwithstanding these limitations, a district created pursuant to this part to finance capital improvements with bonds may levy assessments until the maximum maturity of the bonds. The management district plan may set forth specific increases in assessments for each year of operation of the district.

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(i) The proposed time for implementation and completion of the management district plan. (j) Any proposed rules and regulations to be applicable to the district. (k) (1) A list of the properties or businesses to be assessed, including the assessor’s parcel numbers for properties to be assessed, and a statement of the method or methods by which the expenses of a district will be imposed upon benefited real property or businesses, in proportion to the benefit received by the property or business, to defray the cost thereof. (2) In a property-based district, the proportionate special benefit derived by each identified parcel shall be determined exclusively in relationship to the entirety of the capital cost of a public improvement, the maintenance and operation expenses of a public improvement, or the cost of the activities. An assessment shall not be imposed on any parcel that exceeds the reasonable cost of the proportional special benefit conferred on that parcel. Only special benefits are assessable, and a property-based district shall separate the general benefits, if any, from the special benefits conferred on a parcel. Parcels within a property-based district that are owned or used by any city, public agency, the State of California, or the United States shall not be exempt from assessment unless the governmental entity can demonstrate by clear and convincing evidence that those publicly owned parcels in fact receive no special benefit. The value of any incidental, secondary, or collateral effects that arise from the improvements, maintenance, or activities of a property-based district and that benefit property or persons not assessed shall not be deducted from the entirety of the cost of any special benefit or affect the proportionate special benefit derived by each identified parcel. (l) In a property-based district, the total amount of all special benefits to be conferred upon the properties located within the property-based district. (m) In a property-based district, the total amount of general benefits, if any. (n) In a property-based district, a detailed engineer’s report prepared by a registered professional engineer certified by the State of California supporting all assessments contemplated by the management district plan. (o) Any other item or matter required to be incorporated therein by the city council. 36623. Procedure to levy assessment (a) If a city council proposes to levy a new or increased property assessment, the notice and protest and hearing procedure shall comply with Section 53753 of the Government Code. (b) If a city council proposes to levy a new or increased business assessment, the notice and protest and hearing procedure shall comply with Section 54954.6 of the Government Code, except that notice shall be mailed to the owners of the businesses proposed to be assessed. A protest may be made orally or in writing by any interested person. Every written protest shall be filed with the clerk at or before the time fixed for the public hearing. The city council may waive any irregularity in the form or content of any written protest. A written protest may be withdrawn in writing at any time before the conclusion of the public hearing. Each written protest shall contain a description of the business in which the person subscribing the protest is interested sufficient to identify the business and, if a person subscribing is not shown on the official records of the city as the owner of the business, the protest shall contain or be accompanied by written evidence that the person subscribing is the owner of the business or the authorized representative. A written protest that does not comply with this section shall not be counted in determining a majority protest. If written protests are received from the owners or authorized representatives of businesses in the proposed district that will pay 50 percent or more of the assessments proposed to be levied and protests are not withdrawn so as to reduce the protests to less than 50 percent, no further proceedings to levy the proposed assessment against such businesses, as contained in the resolution of intention, shall be taken for a period of one year from the date of the finding of a majority protest by the city council. (c) If a city council proposes to conduct a single proceeding to levy both a new or increased property assessment and a new or increased business assessment, the notice and protest and hearing procedure for the property assessment shall comply with subdivision (a), and the notice and protest and hearing procedure for the business assessment shall comply with subdivision (b). If a majority protest is received from either the property or business owners, that respective portion of the assessment shall not be levied. The remaining portion of the assessment may be levied unless the improvement or other special benefit was proposed to be funded by assessing both property and business owners. 36624. Changes to proposed assessments At the conclusion of the public hearing to establish the district, the city council may adopt, revise, change, reduce, or modify the proposed assessment or the type or types of improvements, maintenance, and activities to be funded with the

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revenues from the assessments. Proposed assessments may only be revised by reducing any or all of them. At the public hearing, the city council may only make changes in, to, or from the boundaries of the proposed property and business improvement district that will exclude territory that will not benefit from the proposed improvements, maintenance, and activities. Any modifications, revisions, reductions, or changes to the proposed assessment district shall be reflected in the notice and map recorded pursuant to Section 36627. 36625. Resolution of formation (a) If the city council, following the public hearing, decides to establish a proposed property and business improvement district, the city council shall adopt a resolution of formation that shall include, but is not limited to, all of the following: (1) A brief description of the proposed improvements, maintenance, and activities, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property, businesses, or both within the district, a statement on whether bonds will be issued, and a description of the exterior boundaries of the proposed district, which may be made by reference to any plan or map that is on file with the clerk. The descriptions and statements need not be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements, maintenance, and activities and the location and extent of the proposed district. (2) The number, date of adoption, and title of the resolution of intention. (3) The time and place where the public hearing was held concerning the establishment of the district. (4) A determination regarding any protests received. The city shall not establish the district or levy assessments if a majority protest was received. (5) A statement that the properties, businesses, or properties and businesses in the district established by the resolution shall be subject to any amendments to this part. (6) A statement that the improvements, maintenance, and activities to be conferred on businesses and properties in the district will be funded by the levy of the assessments. The revenue from the levy of assessments within a district shall not be used to provide improvements, maintenance, or activities outside the district or for any purpose other than the purposes specified in the resolution of intention, as modified by the city council at the hearing concerning establishment of the district. Notwithstanding the foregoing, improvements and activities that must be provided outside the district boundaries to create a special or specific benefit to the assessed parcels or businesses may be provided, but shall be limited to marketing or signage pointing to the district. (7) A finding that the property or businesses within the area of the property and business improvement district will be benefited by the improvements, maintenance, and activities funded by the proposed assessments, and, for a property-based district, that property within the district will receive a special benefit. (8) In a property-based district, the total amount of all special benefits to be conferred on the properties within the property-based district. (b) The adoption of the resolution of formation and, if required, recordation of the notice and map pursuant to Section 36627 shall constitute the levy of an assessment in each of the fiscal years referred to in the management district plan. 36627. Notice and assessment diagram Following adoption of the resolution establishing district assessments on properties pursuant to Section 36625, the clerk shall record a notice and an assessment diagram pursuant to Section 3114. No other provision of Division 4.5 (commencing with Section 3100) applies to an assessment district created pursuant to this part. 36628. Establishment of separate benefit zones within district; Categories of businesses The city council may establish one or more separate benefit zones within the district based upon the degree of benefit derived from the improvements or activities to be provided within the benefit zone and may impose a different assessment within each benefit zone. If the assessment is to be levied on businesses, the city council may also define categories of businesses based upon the degree of benefit that each will derive from the improvements or activities to be provided within the district and may impose a different assessment or rate of assessment on each category of business, or on each category of business within each zone. 36628.5. Assessments on businesses or property owners

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The city council may levy assessments on businesses or on property owners, or a combination of the two, pursuant to this part. The city council shall structure the assessments in whatever manner it determines corresponds with the distribution of benefits from the proposed improvements, maintenance, and activities, provided that any property-based assessment conforms with the requirements set forth in paragraph (2) of subdivision (k) of Section 36622. 36629. Provisions and procedures applicable to benefit zones and business categories All provisions of this part applicable to the establishment, modification, or disestablishment of a property and business improvement district apply to the establishment, modification, or disestablishment of benefit zones or categories of business. The city council shall, to establish, modify, or disestablish a benefit zone or category of business, follow the procedure to establish, modify, or disestablish a property and business improvement district. 36630. Expiration of district; Creation of new district If a property and business improvement district expires due to the time limit set pursuant to subdivision (h) of Section 36622, a new management district plan may be created and the district may be renewed pursuant to this part. CHAPTER 3. Assessments 36631. Time and manner of collection of assessments; Delinquent payments The collection of the assessments levied pursuant to this part shall be made at the time and in the manner set forth by the city council in the resolution levying the assessment. Assessments levied on real property may be collected at the same time and in the same manner as for the ad valorem property tax, and may provide for the same lien priority and penalties for delinquent payment. All delinquent payments for assessments levied pursuant to this part may be charged interest and penalties. 36632. Assessments to be based on estimated benefit; Classification of real property and businesses; Exclusion of residential and agricultural property (a) The assessments levied on real property pursuant to this part shall be levied on the basis of the estimated benefit to the real property within the property and business improvement district. The city council may classify properties for purposes of determining the benefit to property of the improvements and activities provided pursuant to this part. (b) Assessments levied on businesses pursuant to this part shall be levied on the basis of the estimated benefit to the businesses within the property and business improvement district. The city council may classify businesses for purposes of determining the benefit to the businesses of the improvements and activities provided pursuant to this part. (c) Properties zoned solely for residential use, or that are zoned for agricultural use, are conclusively presumed not to benefit from the improvements and service funded through these assessments, and shall not be subject to any assessment pursuant to this part. 36633. Time for contesting validity of assessment The validity of an assessment levied under this part shall not be contested in an action or proceeding unless the action or proceeding is commenced within 30 days after the resolution levying the assessment is adopted pursuant to Section 36625. An appeal from a final judgment in an action or proceeding shall be perfected within 30 days after the entry of judgment. 36634. Service contracts authorized to establish levels of city services The city council may execute baseline service contracts that would establish levels of city services that would continue after a property and business improvement district has been formed. 36635. Request to modify management district plan The owners’ association may, at any time, request that the city council modify the management district plan. Any modification of the management district plan shall be made pursuant to this chapter. 36636. Modification of plan by resolution after public hearing; Adoption of resolution of intention

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(a) Upon the written request of the owners’ association, the city council may modify the management district plan after conducting one public hearing on the proposed modifications. The city council may modify the improvements and activities to be funded with the revenue derived from the levy of the assessments by adopting a resolution determining to make the modifications after holding a public hearing on the proposed modifications. If the modification includes the levy of a new or increased assessment, the city council shall comply with Section 36623. Notice of all other public hearings pursuant to this section shall comply with both of the following: (1) The resolution of intention shall be published in a newspaper of general circulation in the city once at least seven days before the public hearing. (2) A complete copy of the resolution of intention shall be mailed by first class mail, at least 10 days before the public hearing, to each business owner or property owner affected by the proposed modification. (b) The city council shall adopt a resolution of intention which states the proposed modification prior to the public hearing required by this section. The public hearing shall be held not more than 90 days after the adoption of the resolution of intention. 36637. Reflection of modification in notices recorded and maps Any subsequent modification of the resolution shall be reflected in subsequent notices and maps recorded pursuant to Division 4.5 (commencing with Section 3100), in a manner consistent with the provisions of Section 36627. CHAPTER 3.5. Financing 36640. Bonds authorized; Procedure; Restriction on reduction or termination of assessments (a)The city council may, by resolution, determine and declare that bonds shall be issued to finance the estimated cost of some or all of the proposed improvements described in the resolution of formation adopted pursuant to Section 36625, if the resolution of formation adopted pursuant to that section provides for the issuance of bonds, under the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500)) or in conjunction with Marks-Roos Local Bond Pooling Act of 1985 (Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code). Either act, as the case may be, shall govern the proceedings relating to the issuance of bonds, although proceedings under the Bond Act of 1915 may be modified by the city council as necessary to accommodate assessments levied upon business pursuant to this part. (b) The resolution adopted pursuant to subdivision (a) shall generally describe the proposed improvements specified in the resolution of formation adopted pursuant to Section 36625, set forth the estimated cost of those improvements, specify the number of annual installments and the fiscal years during which they are to be collected. The amount of debt service to retire the bonds shall not exceed the amount of revenue estimated to be raised from assessments over 30 years. (c) Notwithstanding any other provision of this part, assessments levied to pay the principal and interest on any bond issued pursuant to this section shall not be reduced or terminated if doing so would interfere with the timely retirement of the debt. CHAPTER 4. Governance 36650. Report by owners’ association; Approval or modification by city council (a) The owners’ association shall cause to be prepared a report for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvements, maintenance, and activities described in the report. The owners’ association’s first report shall be due after the first year of operation of the district. The report may propose changes, including, but not limited to, the boundaries of the property and business improvement district or any benefit zones within the district, the basis and method of levying the assessments, and any changes in the classification of property, including any categories of business, if a classification is used. (b) The report shall be filed with the clerk and shall refer to the property and business improvement district by name, specify the fiscal year to which the report applies, and, with respect to that fiscal year, shall contain all of the following information: (1) Any proposed changes in the boundaries of the property and business improvement district or in any benefit zones or classification of property or businesses within the district. (2) The improvements, maintenance, and activities to be provided for that fiscal year.

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(3) An estimate of the cost of providing the improvements, maintenance, and activities for that fiscal year. (4) The method and basis of levying the assessment in sufficient detail to allow each real property or business owner, as appropriate, to estimate the amount of the assessment to be levied against his or her property or business for that fiscal year. (5) The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal year. (6) The estimated amount of any contributions to be made from sources other than assessments levied pursuant to this part. (c) The city council may approve the report as filed by the owners’ association or may modify any particular contained in the report and approve it as modified. Any modification shall be made pursuant to Sections 36635 and 36636. The city council shall not approve a change in the basis and method of levying assessments that would impair an authorized or executed contract to be paid from the revenues derived from the levy of assessments, including any commitment to pay principal and interest on any bonds issued on behalf of the district. 36651. Designation of owners’ association to provide improvements, maintenance, and activities The management district plan may, but is not required to, state that an owners’ association will provide the improvements, maintenance, and activities described in the management district plan. If the management district plan designates an owners’ association, the city shall contract with the designated nonprofit corporation to provide services. CHAPTER 5. Renewal 36660. Renewal of district; Transfer or refund of remaining revenues; District term limit (a) Any district previously established whose term has expired, or will expire, may be renewed by following the procedures for establishment as provided in this chapter. (b) Upon renewal, any remaining revenues derived from the levy of assessments, or any revenues derived from the sale of assets acquired with the revenues, shall be transferred to the renewed district. If the renewed district includes additional parcels or businesses not included in the prior district, the remaining revenues shall be spent to benefit only the parcels or businesses in the prior district. If the renewed district does not include parcels or businesses included in the prior district, the remaining revenues attributable to these parcels shall be refunded to the owners of these parcels or businesses. (c) Upon renewal, a district shall have a term not to exceed 10 years, or, if the district is authorized to issue bonds, until the maximum maturity of those bonds. There is no requirement that the boundaries, assessments, improvements, or activities of a renewed district be the same as the original or prior district. CHAPTER 6. Disestablishment 36670. Circumstances permitting disestablishment of district; Procedure (a) Any district established or extended pursuant to the provisions of this part, where there is no indebtedness, outstanding and unpaid, incurred to accomplish any of the purposes of the district, may be disestablished by resolution by the city council in either of the following circumstances: (1) If the city council finds there has been misappropriation of funds, malfeasance, or a violation of law in connection with the management of the district, it shall notice a hearing on disestablishment. (2) During the operation of the district, there shall be a 30-day period each year in which assessees may request disestablishment of the district. The first such period shall begin one year after the date of establishment of the district and shall continue for 30 days. The next such 30-day period shall begin two years after the date of the establishment of the district. Each successive year of operation of the district shall have such a 30-day period. Upon the written petition of the owners or authorized representatives of real property or the owners or authorized representatives of businesses in the district who pay 50 percent or more of the assessments levied, the city council shall pass a resolution of intention to disestablish the district. The city council shall notice a hearing on disestablishment. (b) The city council shall adopt a resolution of intention to disestablish the district prior to the public hearing required by this section. The resolution shall state the reason for the disestablishment, shall state the time and place of the public hearing, and shall contain a proposal to dispose of any assets acquired with the revenues of the assessments levied within the property and business improvement district. The notice of the hearing on disestablishment required by this section shall be given by mail to the property owner of each parcel or to the

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owner of each business subject to assessment in the district, as appropriate. The city shall conduct the public hearing not less than 30 days after mailing the notice to the property or business owners. The public hearing shall be held not more than 60 days after the adoption of the resolution of intention. 36671. Refund of remaining revenues upon disestablishment or expiration without renewal of district; Calculation of refund; Use of outstanding revenue collected after disestablishment of district (a) Upon the disestablishment or expiration without renewal of a district, any remaining revenues, after all outstanding debts are paid, derived from the levy of assessments, or derived from the sale of assets acquired with the revenues, or from bond reserve or construction funds, shall be refunded to the owners of the property or businesses then located and operating within the district in which assessments were levied by applying the same method and basis that was used to calculate the assessments levied in the fiscal year in which the district is disestablished or expires. All outstanding assessment revenue collected after disestablishment shall be spent on improvements and activities specified in the management district plan. (b) If the disestablishment occurs before an assessment is levied for the fiscal year, the method and basis that was used to calculate the assessments levied in the immediate prior fiscal year shall be used to calculate the amount of any refund.

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APPENDIX 2 – ASSESSED BUSINESSES HOTEL NAME SITE ADDRESS CITY ST ZIP AC HOTEL SAN FRANCISCO AIRPORT/OYSTER POINT WATERFRONT 1333 Veterans Blvd So. San Francisco CA 94080 AIRPORT INN 751 Airport Blvd So. San Francisco CA 94080 ALL SEASONS LODGE 800 El Camino Real So. San Francisco CA 94080 ALOFT SAN FRANCISCO AIRPORT 401 E. Millbrae Ave Millbrae CA 94030 AMERICANA INN MOTEL 760 El Camino Real So. San Francisco CA 94080 AMERICAS BEST VALUE INN - PACIFICA 2160 Francisco Blvd Pacifica CA 94044 ANCHOR INN PACIFICA 500 San Pedro Ave Pacifica CA 94044 ARISTOCRAT HOTEL, BW SIGNATURE COLLECTION 1410 Cabrillo Hwy S Half Moon Bay CA 94019 ATHERTON INN 1201 W Selby Lane Redwood City CA 94061 ATHERTON PARK INN & SUITES 2834 El Camino Real Redwood City CA 94061 BAY LANDING HOTEL 1550 Bayshore Hwy Burlingame CA 94010 BAYHILL INN 950 El Camino Real San Bruno CA 94066 BEACH HOUSE HOTEL 4100 Cabrillo Hwy N Half Moon Bay CA 94019 BELMONT PALMS 700 El Camino Real Belmont CA 94002 BEST WESTERN COYOTE POINT 480 N Bayshore Blvd San Mateo CA 94401 BEST WESTERN INN 316 El Camino Real Redwood City CA 94062 BEST WESTERN PLUS EXECUTIVE SUITES 25 5th Ave Redwood City CA 94063 BEST WESTERN PLUS GROSVENOR HOTEL 380 S Airport Blvd So. San Francisco CA 94080 BUDGET INN 2526 El Camino Real Redwood City CA 94061 CANYON RANCH WELLNESS RETREAT 16350 Skyline Blvd Woodside CA 94062 CAPRI MOTEL 2380 El Camino Real Redwood City CA 94063 THE CATRINA HOTEL 2110 S El Camino Real San Mateo CA 94403 COMFORT INN & SUITES - SAN BRUNO 611 San Bruno Ave E San Bruno CA 94066 COMFORT INN & SUITES SFO NORTH 121 E. Grand Ave So. San Francisco CA 94080 COSTANOA LODGE+CAMP+RESORT 2001 Rossi Rd Pescadero CA 94060 COUNTRY INN & SUITES BY RADISSON 251 El Camino Real San Carlos CA 94070 COURTYARD REDWOOD CITY 600 Bair Island Rd Redwood City CA 94063 COURTYARD SAN FRANCISCO AIRPORT 1050 Bayhill Dr San Bruno CA 94066 COURTYARD SAN MATEO FOSTER CITY 550 Shell Blvd Foster City CA 94404 CROWNE PLAZA FOSTER CITY-SAN MATEO 1221 Chess Dr Foster City CA 94404 CROWNE PLAZA S.F. AIRPORT 1177 Airport Blvd Burlingame CA 94010 CYPRESS INN ON MIRAMAR BEACH 407 Mirada Rd Half Moon Bay CA 94019 DAYS INN - REDWOOD CITY 2650 El Camino Real Redwood City CA 94061 DAYS INN S.F. AIRPORT-OYSTER POINT - SSF 1113 Airport Blvd So. San Francisco CA 94080 DELUXE INN - REDWOOD CITY 1402 Stafford St Redwood City CA 94062

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DELUXE INN - SSF 920 El Camino Real So. San Francisco CA 94080 DOUBLETREE BY HILTON S.F. AIRPORT 835 Airport Blvd Burlingame CA 94010 DOUBLETREE BY HILTON S.F. AIRPORT NORTH 5000 Sierra Point Parkway Brisbane CA 94005 DOUBLETREE BY HILTON SF / SOUTH AIRPORT BLVD 275 S Airport Blvd So. San Francisco CA 94080 THE DYLAN HOTEL AT SFO 110 S El Camino Real Millbrae CA 94030 EMBASSY SUITES S.F. AIRPORT SOUTH SAN FRANCISCO 250 Gateway Blvd So. San Francisco CA 94080 EMBASSY SUITES S.F. AIRPORT - WATERFRONT 150 Anza Blvd Burlingame CA 94010 EXTENDED STAY AMERICA - BELMONT 120 Sem Lane Belmont CA 94002 EXTENDED STAY AMERICA - SAN CARLOS 3 Circle Star Way San Carlos CA 94070 EXTENDED STAY AMERICA - SAN MATEO 1830 Gateway Dr San Mateo CA 94404 FAIRFIELD INN & SUITES SAN FRANCISCO PACIFICA 500 Old County Rd Pacifica CA 94044 FAIRFIELD INN & SUITES SAN FRANCISCO SAN CARLOS 555 Skyway Rd San Carlos CA 94070 FAIRFIELD INN & SUITES SFO OYSTER POINT AREA 127 W. Harris Avenue So. San Francisco CA 94080 FOUR POINTS BY SHERATON HOTEL & SUITES 264 S Airport Blvd So. San Francisco CA 94080 FOUR SEASONS HOTEL SILICON VALLEY 2050 University Ave East Palo Alto CA 94303 GARDEN MOTEL 1690 Broadway Redwood City CA 94063 GATEWAY INN & SUITES 516 El Camino Real San Bruno CA 94066 GOOD LIVING INN 1562 El Camino Real San Carlos CA 94070 GOOD NITE INN 485 Veterans Blvd Redwood City CA 94063 GRAND BAY SAN FRANCISCO 223 Twin Dolphin Dr Redwood City CA 94065 GRAND HYATT AT SFO 55 S. McDonnell Road San Francisco CA 94128 HALF MOON BAY INN 401 Main St Half Moon Bay CA 94019 HALF MOON BAY LODGE 2400 Cabrillo Hwy S Half Moon Bay CA 94019 HAMPTON INN & SUITES SFO SOUTH - BURLINGAME 1755 Bayshore Hwy Burlingame CA 94010 HAMPTON INN & SUITES - SAN MATEO 2940 S. Norfolk St. San Mateo CA 94403 HAMPTON INN SFO NORTH - SSF 300 Gateway Blvd So. San Francisco CA 94080 HARBOR VIEW INN 51 Ave Alhambra El Granada CA 94018 HILTON GARDEN INN SAN MATEO 2000 Bridgepoint Circle San Mateo CA 94404 HILTON GARDEN INN SFO - BURLINGAME 765 Airport Blvd Burlingame CA 94010 HILTON GARDEN INN - SFO NORTH - SSF 670 Gateway Blvd So. San Francisco CA 94080 HILTON S.F. AIRPORT BAYFRONT 600 Airport Blvd Burlingame CA 94010 HOLIDAY INN & SUITES SAN MATEO-SF SFO 330 N Bayshore Blvd San Mateo CA 94401 HOLIDAY INN EXPRESS & SUITES BELMONT 1650 El Camino Real Belmont CA 94002 HOLIDAY INN EXPRESS REDWOOD CITY CENTRAL 1836 El Camino Real Redwood City CA 94063 HOLIDAY INN EXPRESS SFO NORTH - SSF 373 S Airport Blvd So. San Francisco CA 94080

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HOLIDAY INN EXPRESS SFO SOUTH - BURLINGAME 1250 Bayshore Hwy Burlingame CA 94010 HOME2 SUITES BY HILTON SFO NORTH 550 Gateway Blvd So. San Francisco CA 94080 HOMEWOOD SUITES BY HILTON BELMONT 1201 Shoreway Road Belmont CA 94002 HOMEWOOD SUITES BY HILTON SFO AIRPORT NORTH 2000 Shoreline Court Brisbane CA 94005 HOTEL 1550 1550 El Camino Real San Bruno CA 94066 HOTEL ALUXOR 500 El Camino Real San Bruno CA 94066 HOTEL AURA SFO 190 El Camino Real San Bruno CA 94066 HOTEL BELMONT 560 El Camino Real Belmont CA 94002 HOTEL FOCUS SFO 111 Mitchell Ave So. San Francisco CA 94080 HOTEL NOVA SFO BY FAIRBRIDGE 410 S Airport Blvd So. San Francisco CA 94080 HOTEL V 222 S Airport Blvd So. San Francisco CA 94080 HYATT HOUSE BELMONT/REDWOOD SHORES 400 Concourse Dr Belmont CA 94002 HYATT PLACE SAN CARLOS 26 El Camino Real San Carlos CA 94070 HYATT REGENCY SAN FRANCISCO AIRPORT 1333 Bayshore Hwy Burlingame CA 94010 INN @ BAYSHORE 140 N Bayshore Blvd San Mateo CA 94401 INN AT MAVERICKS 346 Princeton Ave El Granada CA 94018 INN AT ROCKAWAY 200 Rockaway Beach Ave Pacifica CA 94044 INN BY THE SFO 701 Airport Blvd So. San Francisco CA 94080 LA QUINTA INN & SUITES S.F. AIRPORT WEST 1390 El Camino Real Millbrae CA 94030 LA QUINTA INN S.F. AIRPORT NORTH 20 Airport Blvd So. San Francisco CA 94080 LARKSPUR LANDING HOTEL SSF 690 Gateway Blvd So. San Francisco CA 94080 LIA HOTEL 950 El Camino Real San Carlos CA 94070 LIGHTHOUSE HOTEL 105 Rockaway Beach Ave Pacifica CA 94044 MARRIOTT FAIRFIELD INN & SUITES SFO 250 El Camino Real Millbrae CA 94030 MILL ROSE INN 615 Mill St Half Moon Bay CA 94019 MILLWOOD INN & SUITES 1375 El Camino Real Millbrae CA 94030 THE MIRAMAR INN & SUITES 3020 Cabrillo Hwy N Half Moon Bay CA 94019 MOTEL 6 - BELMONT 1101 Shoreway Rd Belmont CA 94002 NANTUCKET WHALE INN 779 Main St Half Moon Bay CA 94019 NICHE HOTEL 868 Main St Redwood City CA 94063 OCEAN VIEW INN 8425 Cabrillo Hwy Montara CA 94037 THE OCEANFRONT HOTEL 211 Mirada Rd Half Moon Bay CA 94019 OCEANO HOTEL & SPA 280 Capistrano Rd Half Moon Bay CA 94019 PACIFICA BEACH HOTEL 525 Crespi Dr Pacifica CA 94044 PARK POINTE HOTEL 245 S. Airport Blvd So. San Francisco CA 94080 PESCADERO CREEK INN 393 Stage Rd Pescadero CA 94060

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QUALITY INN HALF MOON BAY 2930 Cabrillo Hwy N Half Moon Bay CA 94019 RAMADA LIMITED SUITES 721 Airport Blvd So. San Francisco CA 94080 REDWOOD CREEK INN 1090 El Camino Real Redwood City CA 94063 REDWOOD MOTOR COURT 3706 Rolison Rd Redwood City CA 94063 REGENCY INN SFO 411 San Bruno Ave E San Bruno CA 94066 RESIDENCE INN SAN FRANCISCO AIRPORT/MILLBRAE 161 N. Rollins Road Millbrae CA 94030 RESIDENCE INN REDWOOD CITY SAN CARLOS 800 E. San Carlos Ave San Carlos CA 94070 RESIDENCE INN SAN FRANCISCO AIRPORT/SAN MATEO 2000 Winward Way San Mateo CA 94404 THE RITZ-CARLTON, HALF MOON BAY One Miramontes Point Rd Half Moon Bay CA 94019 RITZ INN 151 El Camino Real San Bruno CA 94066 ROYAL INN 120 Hickey Blvd So. San Francisco CA 94080 SAN BENITO HOUSE 356 Main St Half Moon Bay CA 94019 SAN CARLOS INN 1140 Morse Blvd San Carlos CA 94070 SAN FRANCISCO AIRPORT MARRIOTT WATERFRONT 1800 Old Bayshore Hwy Burlingame CA 94010 SAN MATEO MARRIOTT 1770 So. Amphlett Blvd San Mateo CA 94402 SEA BREEZE MOTEL 100 Rockaway Beach Ave Pacifica CA 94044 SEAL COVE INN 221 Cypress Ave Moss Beach CA 94038 SEQUOIA INN 526 El Camino Real Redwood City CA 94063 SFO AIRPORT HOTEL, EL RANCHO INN 1100 El Camino Real Millbrae CA 94030 SILICON VALLEY INN 630 El Camino Real Belmont CA 94002 SONESTA ES SUITES SFO SAN BRUNO 1350 Huntington San Bruno CA 94066 SONESTA ES SUITES SFO OYSTER POINT WATERFRONT 1350 Veterans Blvd So. San Francisco CA 94080 SONESTA SELECT SFO OYSTER POINT WATERFRONT 1300 Veterans Blvd So. San Francisco CA 94080 SPRINGHILL SUITES BELMONT REDWOOD SHORES 1401 Shoreway Rd Belmont CA 94002 SUPER 8 S.F. AIRPORT - SAN BRUNO 421 El Camino Real San Bruno CA 94066 TOWNEPLACE SUITES SAN MATEO FOSTER CITY 1299 Chess Drive Foster City CA 94404 TRAVELERS INN 100 Hickey Blvd So. San Francisco CA 94080 TRAVELODGE SFO NORTH 326 S Airport Blvd So. San Francisco CA 94080 VAGABOND INN EXECUTIVE S.F. AIRPORT BAYFRONT 1640 Old Bayshore Hwy Burlingame CA 94010 VILLA MONTES HOTEL, ASCEND HOTEL COLLECTION 620 El Camino Real San Bruno CA 94066 THE WESTIN S.F. AIRPORT 1 Old Bayshore Hwy Millbrae CA 94030 ZABALLA HOUSE BED & BREAKFAST 324 Main St Half Moon Bay CA 94019 Hotel Nia 200 Independence Drive Menlo Park CA 94025 Park James 1400 El Camino Real Menlo Park CA 94025 Rosewood Sand Hill 2825 Sand Hill Road Menlo Park CA 94025

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Stanford Park Hotel 100 El Camino Real Menlo Park CA 94025 Residence Inn 555 Glenwood Avenue Menlo Park CA 94025 Best Western Plus Riviera 15 El Camino Real Menlo Park CA 94025 Hotel Lucent 727 El Camino Real Menlo Park CA 94025 Menlo Park Inn 1315 El Camino Real Menlo Park CA 94025 Red Cottage Inn 1704 El Camino Real Menlo Park CA 94025

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APPENDIX 3 – BENEFITS BY BUSINESS CATEGORY Program Service Tier 1 (1.5%) Tier 2 (0.75%) General Listing on www.thesanfranciscopeninsula.com with link to hotel booking page X X General Inclusion in Sales, Marketing and Promotional Opportunities X X General Inclusion in SFP's Consumer Brochures X X General Access to SFP's research reports and insights X X General Represented by SFP at industry conferences and events X X General Access to California Hotel Lodging Association's industry advocacy efforts and training materials X X Consumer Opportunity to participate in Consumer Marketing Campaigns X X Consumer Public Relations participation opportunities X X Consumer Familiarization Tour (Press and Influencer) Opportunities X X Consumer Inclusion Opportunity in Social Media Efforts X X Consumer Inclusion Opportunity in Destination Video and Photo Shoots X X Consumer New project and special event opportunities X X Travel Trade Trade Show Opportunities X X Travel Trade Sales Mission Opportunities X X Travel Trade Lead Opportunities X X Travel Trade Familiarization Tour Leads (Press and Travel Trade) Opportunities X X Meetings Lead Distribution X Meetings Site Inspections X Meetings Convention Services Support X Meetings Opportunity to participate in Sales Missions X Meetings Opportunity to participate in Client Events X Meetings Industry tradeshow participation X Meetings Participation in local industry chapter meetings and events X Meetings Familiarization Tours X Meetings Marketing Campaigns X Meetings Inclusion in Meetings Market Brochures X Meetings Opportunity for Sponsorship of Group Events X Meetings Custom Event Landing Page for Groups: Things To Do Nearby With Your Selected Venue (Itinerary) X

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Meetings Distribution of hot rates and dates to planners X Meetings Co-op advertising opportunities in key meeting publications X Meetings Social media mentions/posts promoting groups space X Meetings Inclusion on Meeting Planner section of website X Meetings Opportunity to be highlighted in meeting planner newsletter X Meetings Access to SF Travel group leads via our alliance with SFT X

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APPENDIX 4 – SMG CONSULTING ANALYSIS

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SF Peninsula Tourism Business Improvement District Pro Forma Review

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Overview In 2001, the Organization established a Tourism Business Improvement District (TBID) under the Parking and Business Improvement Area Law of 1989 (’89 Law) and now wishes to convert to a Tourism Marketing District (TMD) under the Property and Business Improvement District Law of 1994 (’94 Law). The organization is moving forward with a Tourism Business Improvement District (TBID) transition that will increase its funding above $6 million annually to be available for tourism promotion efforts. The TBID contribution is a significant budget increase for the organization. In developing the proposal for the TBID renewal and the subsequent approval of the lodging industry, the organization staff has prepared a TMD Benefits Proforma to estimate the potential return on investment from the new TBID funds. This staff assessment includes the proposed allocation and use of new funds for different tourism promotion efforts (sales, advertising, public relations, social media, etc.) and the projected return on investment for those funds. Proforma Review The TMD Benefits Proforma review includes a review of the staff proforma to check the assumptions and estimates and make suggestions and recommendations. Scope of Work The following is a review of the proforma developed for the TBID renewal. The analysis was done using the information supplied by The San Francisco Peninsula CVB. Project elements include the following: I. DEVELOP SMITH TRAVEL RESEARCH TRENDLINE AND ANNUAL GROWTH RATE FOR LODGING REVENUE. DEVELOP MULTI-YEAR FORECAST. Ø DETERMINE THE PROJECTABLE RATE OF GROWTH. • REVIEW STAFF DRAFT PROFORMA, INCLUDING ASSUMPTIONS AND FINAL ESTIMATES. I. COMPARE PROFORMA ESTIMATES WITH TRENDLINE AND ASSESS WITH POTENTIALLY DIFFERENT SCENARIOS (HIGH, MEDIUM, AND LOW ESTIMATES). Limiting Conditions The following analysis and estimates are based on the best information and time available. The results and opinions provided are a guide for consideration, and we do not claim as to the accuracy of the final results.

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Model Development We developed an SF Peninsula Tourism Economic Model to develop lodging revenue and room night projections with the addition of new properties and the potential of Menlo Park Inclusion. The model was developed utilizing the past ten years of monthly lodging data from Smith Travel Research. The model measures a variety of economic activities, including the following: II. LODGING REVENUE PROJECTIONS THROUGH 2027 III. ROOM NIGHT PROJECTION THROUGH 2027 IV. TBID REVENUE WITHOUT MENLO PARK V. TBID REVENUE WITH MENLO PARK VI. TBIB REVENUE WITH NEW PROPERTIES VII. TBID REVENUE WITHOUT NEW PROPERTIES. The SF Peninsula Tourism Economic Model can be adjusted to test or consider different scenarios. Model Methodology The future growth of ADR and room nights is using a Bayesian Structural Times Series (BSTS) model, a technique for fitting historical data and forecasting future trends (Scott and Varian, Predicting the Present with Bayesian Structural Time Series 2013). BSTS was chosen for its ability to forecast future trends, including seasonal variation, using robust time series data. In this case, data is available in monthly intervals from July 2012. This model was fit by specifying a semi-local linear trend. Confidence intervals bound a mean forecast to quantify the degree of uncertainty in the future (Scott, Fitting Bayesian structural time series with the bsts R package 2017). Rather than having the pandemic disruption influence the forecasts, only data from July 2012 through December 2019 was taken as input. Revenue is simply forecast as the product of ADR and room nights. Given the fact that the STR reports track all cities in San Mateo County, the revenue forecast is reduced in proportion to the number of room nights in the TMD (15,699/17,190) or 91.3 percent. TMD fee revenue is also forecast in proportion to available rooms, with 42 percent A-level property rooms paying 1.5 percent of gross room revenue. The balance is paid by B-level property rooms at 0.75 percent. Construction of three new B-level properties is underway and will bring 451 rooms online. These rooms are assumed to be available from January 2023. There are 533 A-level property rooms and 338 B-level property rooms in Menlo Park. Potential gross room and TMD fee revenue is forecast on the basis of room count proportionality. Model Assumptions The model forecasts mean values of ADR and room nights along with 2.5 percent confidence intervals. This report is based on mean values. By constructing the model in this manner, we are

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SFPTMD Management District Plan 37 January 23, 2023
assuming that the conditions supporting ADR and room night growth prior to the pandemic will continue from 2023 forward. Sources of variation include the impact of macroeconomic conditions, actual timing of new construction (planned and unplanned), promotions and policies such as airline crew waivers. Model Limitations The baseline SF Peninsula Tourism Economic Model provides a static look based on a given set of assumptions. Forecasts of future events are inherently uncertain as the recent pandemic reminded us. As noted above, the model can be adjusted to estimate specific scenarios in detail in which case the relative differences generally provide the most value. Findings Table 1 below summarizes Room Nights, Revenue, and Average Daily Rate (ADR) projections. Table 1: Room Night, Revenue, and Average Daily Rate Projections 2021-2027 A. THE MODEL INCLUDES GROWTH RATE PROJECTIONS FOR EACH OF THOSE CATEGORIES. NOTE THE SIGNIFICANT REVENUE GROWTH PROJECTION IN 2022 AND 2023, AFTER WHICH THE GROWTH SLOWS DOWN INTO A MORE CONSISTENT PATTERN AFTER 2023. (SEE TABLE 1 ABOVE) B. THE TMD BENEFITS PROFORMA DEVELOPED BY STAFF HAS LODGING RATES BETWEEN $200 AND $293, WHICH IS WITHIN ESTIMATES OR THE PROJECTED AVERAGE DAILY RATE OF THE SF PENINSULA TOURISM ECONOMIC MODEL. (SEE TABLE 2) A. REGARDING TBID REVENUE PROJECTION, THE TMD BENEFITS PROFORMA ANTICIPATES TBID REVENUE OF APPROXIMATELY $6M. BASED ON THE SF PENINSULA TOURISM ECONOMIC MODEL'S ASSUMPTIONS, TBID COLLECTIONS COULD BE HIGHER STARTING IN 2022 (APPROXIMATELY $8M). (SEE TABLE 2) B. THE MODEL CONSIDERS THE NEW CONSTRUCTION OF HOTELS (451 UNITS) WHICH INCREASES THE POTENTIAL TBID REVENUE GENERATION BY APPROXIMATELY $207,000. (SEE TABLE 2) C. ADDITIONALLY, THE MODEL CONSIDERS THE POTENTIAL ADDITION OF MENLO PARK HOTELS BEING A PART OF THE TBID. THE ADDITION OF MENLO PARK HOTELS WOULD INCREASE TBID CONTRIBUTIONS BY APPROXIMATELY $638,000 STARTING IN 2023. (SEE TABLE 2) 2021 2022 2023 2024 2025 2026 2027
Room nights 3,201,6723,273,8943,356,7843,470,1923,592,1483,720,5753,824,263 RN annual growth 2.3% 2.5% 3.4% 3.5% 3.6% 2.8%
Revenue (thousands) $430,563$784,357$1,053,955$1,140,669$1,229,371$1,335,188$1,444,536 Rev annual growth 82.2% 34.4% 8.2% 7.8% 8.6% 8.2%
ADR $134 $240 $314 $329 $342 $359 $378
ADR annual growth 78.2% 31.1% 4.7% 4.1% 4.9% 5.3%

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SFPTMD Management District Plan 38 January 23, 2023
Table 2: TMD Room Revenue and Fee Projections
Inventory Notes: Changes in Hotel Inventory 318 rooms lost to Project Home Key (housing the un-housed) during 2020/2021 Possibly December 15, 2022 or early 2023 Red Roof Inn, Burlingame 213 Rooms Possibly in 2023 El Rancho Inn, Millbrae 219 Rooms 2023 (Buyer is getting financing together, no set month for demolishing.) Holiday Inn Express, Burlingame 148 Rooms Possibly 2023 (Entitlements approved Sept 2022. No word when developer will start work.) Comfort Inn & Suites, South San Francisco 166 Rooms 2021 2022 2023 2024 2025 2026 2027
A rooms 6607 Base Year
Total available 15699 TBID Projection
B rooms 9092
A Revenue $101,204,557 $330,100,605$405,089,050$438,417,832$472,510,240$513,181,465$555,203,395

1.50% $2,718,068 $4,951,509$6,076,336$6,576,267$7,087,654$7,697,722$8,328,141 B Revenue $249,358,533 $454,256,803$557,449,620$603,313,899$650,229,026$706,197,349$764,032,666

0.75%
Total TBID/TMD $4,588,257 $8,358,435$10,257,208$11,101,122$11,964,371$12,994,202$14,058,366 New Construction
New rooms 2023 (B) 451 Total w/new hotels $10,464,596$11,325,573$12,206,276$13,256,929$14,342,629 % increase in B 5.0%
Menlo Park
New rooms 2023 (A) 533
% increase in A 8.1%
New rooms 2023 (B) 338
% increase in B 3.5%
Total w/Menlo $10,895,479$11,791,907$12,708,873$13,802,787$14,933,191

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SFPTMD Management District Plan 39 January 23, 2023
Appendix

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SFPTMD Management District Plan 40 January 23, 2023
Appendix 1: San Mateo County Room Revenue
Source: STR Reports and Consulting Team.
$0
$200,000,000
$400,000,000
$600,000,000
$800,000,000
$1,000,000,000
$1,200,000,000
$1,400,000,000
$1,600,000,000
201320142015201620172018201920202021202220232024202520262027 Annual San Mateo County Room RevenueHistoric STR Report Values through October 2022 and Forecast to 2027

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SFPTMD Management District Plan 41 January 23, 2023
Appendix 2: San Mateo County ADR
Source: STR Reports and Consulting Team.
$0$100$200$300$400$500$600$700$800$900
Jul-12Apr-13Jan-14Oct-14Jul-15Apr-16Jan-17Oct-17Jul-18Apr-19Jan-20Oct-20Jul-21Apr-22Jan-23Oct-23Jul-24Apr-25Jan-26Oct-26Jul-27Apr-28Jan-29Oct-29Jul-30Apr-31Jan-32Oct-32Jul-33Apr-34 Monthly San Mateo County ADR Forecast to 2034
Historical97.5% quantileForecast mean2.5% quantile

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SFPTMD Management District Plan 42 January 23, 2023
Appendix 3: San Mateo County Room Nights
Source: STR Reports and Consulting Team.
0 200,000
400,000
600,000
800,000
1,000,000
1,200,000
Jul-12Apr-13Jan-14Oct-14Jul-15Apr-16Jan-17Oct-17Jul-18Apr-19Jan-20Oct-20Jul-21Apr-22Jan-23Oct-23Jul-24Apr-25Jan-26Oct-26Jul-27Apr-28Jan-29Oct-29Jul-30Apr-31Jan-32Oct-32Jul-33Apr-34 Monthly San Mateo County Room Night Forecast to 2034
Historical97.5% quantileForecast mean2.5% quantile

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DATE: June 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager
Marlene Subhashini, Assistant City Manager

FROM: Sofia Mangalam, Community Development Director
Prabath Silva, Chief Building Official
DEPARTMENT: Community Development
SUBJECT: RESOLUTION FOR OVERHIRE OF A SENIOR BUILDING

INSPECTOR POSITION

RECOMMENDATION
It is recommended that the City Council adopt the attached resolution approving the overhire of the Senior Building Inspector position within the Building Division of the Community Development Department.

EXECUTIVE SUMMARY
The Senior Building Inspector position will become vacant on September 1, 2023.

Recruitment for this position in the current job market can take several weeks to accomplish. In an effort to proactively prepare and plan for the transition of duties associated with this key position, staff is requesting that Council approve the overhire of the position. The overhire would allow the Community Development Department to post the job announcements and start the recruitment process for the Senior Building Inspector position in advance of the actual vacancy.

Should the Council authorize the overhire of the position, the period of overhire is expected to be around seven (7) weeks. This period could be less depending on how long it takes to find a qualified candidate. This timeframe will provide training for the new employees within the Department.

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BACKGROUND/ANALYSIS
The Community Development Department (CDD) is committed to planning, maintaining, and improving the quality of life and public safety of Foster City in keeping with the vision of the City Council in the General Plan and other measures that reflect the City’s heritage as a Master Planned community. CDD is comprised of the Planning/Code Enforcement and Building Divisions. The Building Division is responsible for ensuring that all construction projects permitted within the City comply with the California Building Code, the Foster City Municipal Code, and all other applicable codes and regulations. The Building Division provides plan check and building inspection services to ensure compliance with the California Health and Safety Codes.

The Building Division currently consists of the following positions – one (1) Chief Building Official, one (1) Plan Examiner, two (2) Building Inspectors, and two (2) Permit Technicians. The Building Inspector is responsible for conducting on-site inspections of building construction activities to ensure that they are in compliance with approved plans and adopted codes and regulations.

Earlier this year, on February 06, 2023, the City Council authorized the overhire for the Chief Building Official and Building Inspector positions for six weeks, as both of them were set to retire on May 02, 2023. Subsequent to this, staff posted job announcements to fill both vacancies. However, due to the current job market, it took several weeks to fill the positions. The new Chief Building Official started on April 10, 2023, and the Building Inspector on April 28, 2023.

The Senior Building Inspector position will become vacant on September 1, 2023, and keeping in mind that the recruitment process can take several weeks before that position is successfully filled, staff is making a similar request for overhire of the Senior Building Inspector position. An overhire can accelerate the filling of vacant position by initiating the hiring process in advance of actual vacancy. It can be an effective tool for managing staffing transitions. The overhire of the Senior Building Inspector position will alleviate the gap in staffing, thus, minimizing the impacts on service levels to the community and the reliance on outside consultants to fill the vacant position.

Should the Council authorize the overhire of the position, the period of overhire is expected to be approximately seven (7) weeks. The actual period may be less depending on the start date of the position.

California Environmental Quality Act
The request for overhire of the position is exempt per CEQA Guideline Section 15061(b)(3), Common Sense Exemption.

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FISCAL IMPACT
The approximate cost for the seven-week overhire time for the Senior Building Inspector position in FY 23-24 is estimated at $39,000 including expected salary and benefits.

Funding to accommodate this request will need an appropriation of $39,000 in General Fund 001 for CDD - Building Safety, Code, Plan Check Expenditures Account 001-0820- 424-41-10 for salaries and benefits.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Smart Planning, Development, and the Local Economy
ATTACHMENTS:

Attachment 1 - Resolution

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9 8
3 RESOLUTION NO. _______

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY

APPROVING THE OVERHIRE OF THE SENIOR BUILDING INSPECTOR POSITION

CITY OF FOSTER CITY
WHEREAS, the Building Division of the Community Development Department, consists of six (6) full time employees, and
WHEREAS, the Senior Building Inspector position will become vacant on September 01, 2023; and
WHEREAS, the City wishes to have a staffing transition plan by doing an overhire in order to fill the vacancy of the position; and
WHEREAS, the overhire would allow the Community Development Department to post the job announcements and start the recruitment process for the Senior Building Inspector position in advance of the actual vacancy; and WHEREAS, the approximate cost for the seven-week overhire time for the Senior Building Inspector position in FY 23-24 is estimated at $39,000 including expected salary and benefits; and
WHEREAS, funding to accommodate this request will need an appropriation of $39,000 in General Fund 001 for CDD - Building Safety, Code, Plan Check Expenditures Account 001-0820-424-41-10 for salaries and benefits; and NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Foster do hereby approve the overhire of the Senior Building Inspector position for a period of no more than seven (7) weeks until September 01, 2023.

PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the special meeting held on the 20th day of June 2023, by the following vote:

6.10 Attachment 1 - Resolution

262

9 8
3 AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

6.10 Attachment 1 - Resolution

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DATE: June 20, 2023

TO: Mayor and Members of the City Council President and Members of the Estero Municipal Improvement District (EMID) Board of Directors
VIA: Stefan Chatwin, City/District Manager

FROM: Edmund Suen, Finance Director
DEPARTMENT: Finance
SUBJECT: CITY/EMID INVESTMENT POLICY

RECOMMENDATION
It is recommended that the City Council/EMID Board of Directors approve the attached resolutions adopting the City/EMID Investment Policy, dated June 20, 2023.

EXECUTIVE SUMMARY
The Finance Director/Treasurer and Human Resources Director review the City/EMID’s Investment Policy annually. Since the Human Resources Director position has been replaced by an Administrative Services Director position, references to that position in the Investment Policy has been updated accordingly. In addition, the Policy is updated to reflect the current composition of the City Council/EMID Board of Directors.

BACKGROUND AND ANALYSIS
The City/EMID's Investment Policy is reviewed annually by the Finance Director/Treasurer and Human Resources Director. The Policy’s three primary objectives for its investments, in order of priority, remain unchanged: (a) Safety, (b) Liquidity, and (c) Yield.

With the replacement of the Human Resources Director position to an Administrative Services Director position earlier this year, staff has updated these references in the

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Investment Policy accordingly. There are no other changes recommended to the contents of the Investment Policy at this time other than an update of the current composition of the City Council/EMID Board of Directors.

California Environmental Quality Act
Not Applicable

FISCAL IMPACT
There is no fiscal impact with the adoption of the resolutions.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Staff Empowerment and Operational Excellence
ATTACHMENTS:

Attachment 1 - City Resolution
Attachment 2 - EMID Resolution
Attachment 3 - City/EMID Investment Policy

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RESOLUTION NO. _____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY ADOPTING AN UPDATED INVESTMENT POLICY DATED JUNE 20, 2023

CITY OF FOSTER CITY
WHEREAS, California Government Code section 53646 requires that a local agency adopt an Investment Policy that governs the investment of public funds in accordance with State law; and
WHEREAS, the City’s Investment Policy was last updated on November 21, 2022; and
WHEREAS, the City’s three primary objectives for its investments, in order of priority, remain unchanged: a) Safety, b) Liquidity, and c) Yield; and WHEREAS, the City’s Investment Policy is updated to replace the Human Resources Director with the Administrative Services Director (along with the Finance Director/Treasurer) for its annual review; and
WHEREAS, the City’s Investment Policy is updated to also reflect the current composition of the City Council
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Foster City that the Investment Policy dated June 20, 2023 is hereby approved.

PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the special meeting held on the 20th day of June, 2023 by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
________________________________________

JON FROOMIN, MAYOR
ATTEST:
_________________________________

PRISCILLA SCHAUS, CITY CLERK

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266

RESOLUTION NO. _____________

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ESTERO MUNICIPAL

IMPROVEMENT DISTRICT ADOPTING AN UPDATED INVESTMENT POLICY DATED JUNE 20, 2023

ESTERO MUNICIPAL IMPROVEMENT DISTRICT
WHEREAS, California Government Code section 53646 requires that a local agency adopt an Investment Policy that governs the investment of public funds in accordance with State law; and
WHEREAS, the District’s Investment Policy was last updated on November 21, 2022; and
WHEREAS, the District’s three primary objectives for its investments, in order of priority, remain unchanged: a) Safety, b) Liquidity, and c) Yield; and WHEREAS, the District’s Investment Policy is updated to replace the Human Resources Director with the Administrative Services Director (along with the Finance Director/Treasurer) for its annual review; and
WHEREAS, the District’s Investment Policy is updated to also reflect the current composition of the District Board
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Estero Municipal Improvement District that the Investment Policy dated June 20, 2023 is hereby approved.

PASSED AND ADOPTED as a resolution of the Estero Municipal Improvement District at the special meeting held on the 20th day of June, 2023 by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
________________________________________

JON FROOMIN, PRESIDENT
ATTEST:
______________________________________

PRISCILLA SCHAUS, DISTRICT SECRETARY

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267

City of Foster City, California and
Estero Municipal Improvement District

INVESTMENT POLICY

June 20, 2023

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268

CITY OF FOSTER CITY AND

ESTERO MUNICIPAL IMPROVEMENT DISTRICT

INVESTMENT POLICY

June 20, 2023

Jon Froomin, Mayor
Patrick Sullivan, Vice Mayor
Sam Hindi, Council Member
Stacy Jimenez, Council Member
Art Kiesel, Council Member

Stefan Chatwin, City Manager

PREPARED BY:

Financial Services Department

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CITY OF FOSTER CITY AND

ESTERO MUNICIPAL IMPROVEMENT DISTRICT

INVESTMENT POLICY

TABLE OF CONTENTS

POLICY ........................................................................................................................... 4 SCOPE ............................................................................................................................ 4 PRUDENCE .................................................................................................................... 4 OBJECTIVES .................................................................................................................. 5 A. Safety ................................................................................................................... 5 B. Liquidity ................................................................................................................ 5 C. Yield ..................................................................................................................... 5 DELEGATION OF AUTHORITY ..................................................................................... 6 ETHICS AND CONFLICTS OF INTEREST ..................................................................... 6 AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS ......................................... 6 AUTHORIZED AND SUITABLE INVESTMENTS ............................................................ 7 DOWNGRADED BONDS .............................................................................................. 10 COLLATERALIZATION ................................................................................................. 10 SAFEKEEPING AND CUSTODY .................................................................................. 11 DIVERSIFICATION ....................................................................................................... 11 MAXIMUM MATURITIES .............................................................................................. 11 INTERNAL CONTROL .................................................................................................. 11 PERFORMANCE STANDARDS ................................................................................... 11 REPORTING ................................................................................................................. 11 INVESTMENT POLICY ADOPTION ............................................................................. 12 GLOSSARY .................................................................................................................. 13

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4 CITY OF FOSTER CITY AND

ESTERO MUNICIPAL IMPROVEMENT DISTRICT

INVESTMENT POLICY
JUNE 20, 2023

POLICY
It is the policy of the City of Foster City /Estero Muni cipal Improvement District (hereinafter collectively referred to as “City” or "City of Fo ster City") to invest public funds in a manner which will pr ovide the optimal return av ailable consistent with the City’s liquidity needs and the pr imary objective of protecti ng the safety of principal conforming to all laws of the State of California regarding the investment of public funds.

SCOPE
The City Treasurer or his designee is authorized to invest the City's funds in accordance with the California Government Code Se ctions 53601.1, 53602, 53635, and 53646.

This investment policy applies to all financi al assets of the City. These funds are accounted for in the Annual Comprehensive Financial Report which includes the following fund types:
 General Fund
 Special Revenue
 Capital Projects
 Enterprise
 Internal Service
 Trust and Agency
 Any new fund created by the legislat ive body, unless specifically exempted.

All monies entrusted to the City Treasurer will be pooled in an actively managed portfolio except for employee retirement funds, which are administered separately.

PRUDENCE
The actions of the City Treasur er in the performance of his/her duties as manager of public funds shall be evaluat ed using the followin g prudent person standard applied in the context of managing the overall portfolio:

Investments shall be made with judgmen t and care, under circumstances then prevailing, which persons of prudence, disc retion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived.

Investment officers acting in accordance with written procedures and the investment policy exercising due diligence shall be relieved of personal responsibility for an individual security's credit risk or mark et price changes, provided deviations from

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5 expectations are reported to the City Council / District Board in a timely fashion and appropriate action is taken to control adverse developments.

OBJECTIVES
There are three (3) primary obj ectives of the City’s Investme nt activities. In order of priority, they are: a) Safety, b) Liquidity, and c) Yield. In every case, all investment securities that are chosen to achieve t hese objectives will be in conformance with California state law and all applicable local ordinances or policies.

A. Safety
Safety of principal is the foremost objective of the investment program. Investments of the City shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. The City shall seek to safeguard principal by a careful examination of credit risk and market risk of individual investments.

1. Credit Risk - is defined as the risk of loss due to failure of an issuer of a security, shall be mitigated by investing in only very safe institutions and by diversifying the fund so that the failure of any one issuer would not unduly harm the City's cash flow.

2. Market Risk - is defined as the risk of market value fluctuations of the investment portfolio’s securities due to overall changes in the general level of interest rates, shall be mitigated by managing dur ation risk of the City/Distric t fund to no less than one year and no greater than three years.

B. Liquidity
The City investment portfolio will remain suffic iently liquid to enable the City to meet all operating expenditure requirements which might be reasonably anticipated. In order to maintain liquidity, the City shall maintain cash and investments wit h a maturity of not greater than one (1) year that is equal or greater than the sum of the minimum operating and capital reserve requirements established by City Council / District Board policy for the General Fund, Capital Im provement Funds, Enterprise Funds, Internal Service Funds, and any other funds for which the Council/Board may establish minimum reserve requirements. Notwithstanding the above considerations, a minimum of 5% of the portfolio will have investments maturi ng within one day or in pooled or money market funds.

C. Yield
The City investment portfolio shall be designed with the objecti ve of attaining a market rate of return throughout budgetary and ec onomic cycles, taking into account investment risk constraints and the cash flow characteristics of the portfolio. Whenever possible, consistent with risk limitations and prudent investment principles, the City shall make an effort to achieve returns not less than the market average rate of return. The market-average rate of return is defined as the average return on One-Year U.S.

Treasury Notes, measured by an index compri sed of the 12 current U.S. Treasury One- Year Notes.

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272

6 DELEGATION OF AUTHORITY
Pursuant to Section 2.16.030 of the City Municipal Code, the City Tr easurer has been authorized to undertake investment transactions on behalf of the City. The only officials authorized to undertake investment transacti ons on behalf of the City are the City Treasurer and Assistant Finance Director. T he actual disbursement of funds for the placement of individual investments undertaken by these two officials shall be subjected to a second party approval by officers autho rized to sign City checks and wire transfers.

On a quarterly basis, the City Treasurer and t he Administrative Services Director shall discuss the status of current investments, st rategies for future in vestments, and other investment matters deemed necessary and shall report to the City Council as necessary.

The City Treasurer is responsible for ensur ing compliance with the City's investment policies as well as for establishing systems of internal control to regulate the activities of subordinate officials.

ETHICS AND CONFLICTS OF INTEREST
Officers and employees involved in the invest ment process shall refrain from personal business activity that could c onflict with proper ex ecution of the inve stment program, or which could impair their ability to make impar tial investment decisions. Employees and investment officials shall disclose to the Cit y Clerk any material financial interests in financial institutions that c onduct business within this jurisdiction, and they shall further disclose any large personal financ ial investment positions that could be related to the performance of the City investment portfolio.

AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS
The City Treasurer or his/her designee will maintain a lis t of financial institutions authorized to provide invest ment services and shall conduct an annual review of the financial condition and credit worthiness of all in stitutions that the City is currently using for the placement of investments. All fi nancial institutions in cluding broker/dealers which desire to become qualified bidders for the City's investment transactions must provide the Financial Services Department with the following:
 Certification of qualif ication under the Security and Exchange Commission’s (SEC) Rule 15c3-1 (Net Capital Requirement for Brokers and Dealers)  Certification of regist ration with all appropriate f ederal and state regulatory bodies, which may include but are not lim ited to: SEC, Municipal Securities Rulemaking Board, Financial Industry Regulatory Author ity, California Department of Corporations
 Audited financial statem ent for the last three y ears and subsequent quarterly financial statements.
 Certification of having read the City in vestment policy and depository contracts.

The City may require, at its discretion, periodi c recertification of the matters set forth above.

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7 The City Treasurer or his/her designee will investigate all financial institutions including brokers/dealers to determine if they are adequately capitalized, broker or deal in market securities appropriate to the City's needs, an d agree to abide by the conditions set forth in the investment policy of the City. This will be done by having the financial institutions, brokers or dealers complete and return the appropriate questi onnaire to the City Treasurer or his/her designee.

AUTHORIZED AND SUITABLE INVESTMENTS
The State of California Go vernment Code (specifically, sections 16429.1, 53601 and 53649) limits the investment vehicles available to local agencies.

The following table summarizes the authorized investments, their maximum maturity, maximum percentage of portfolio, and maximum investment in any one issuer:

Authorized Investment Type1
Maximum
Maturity
Maximum % of
Portfolio
Maximum Investment in
One Issuer (as % of
Portfolio)
State Treasurer’s Local Agency
Investment Fund
N/A 100% 100%
San Mateo County Pool
Investment Program
N/A 10% 10%
Government Agency Issues
 Local Municipal Bonds 5 years 5% 5%
 State Bonds 5 years 5% 5%
 U.S. Treasur y Obligations 5 years 100% 100%
 U.S. Agency Securities 5 years 100% 50%
Bankers Acceptances 180 da ys 25% 5%
Commercial Paper (“A1” rating
or better)
90 days 20% 5%
Negotiable Certificates of
Deposit
5 years 30% 5%
Repurchase Agreements 1 year 50% 50%
Medium-Term Notes (“A1” rating
or better)
5 years 5% 5%
Shares of Beneficial Interest
(Mutual Funds)
N/A 10% 10%
Shares of Beneficial Interest
issued by a joint powers
authorit
y
N/A 50% 50%
Certificates of Deposit (non-
negotiable)
1 year 10% Maximum insurable
deposit with FDIC2

Detailed descriptions of each type of investments listed above are as follows:

1 Investment Grade Ratings are based on Moody’s Long-Term Obligation Ratings. Alternative equivalent ratings by Standard & Poor’s are also acceptable.
2 Current maximum insured amount per institution is $250,000.

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8  State Treasurer's Local Agency Investment Fund (LAIF) - Government Code Section 16429.1 authorizes each loca l government agency to invest funds at a maximum amount allowable in this investment program admin istered by the California State Treasurer. The maximum amount of funds that can be invested with LAIF as dictated by LAIF regulations.
 San Mateo County Pool Investment Progr am - Money invested with the San Mateo County Pool Investment Program. Investment in the County Pool is limited to 10% of the portfolio.
 Government Agency Issues – Securities fr om various government agencies, such as those identified in Government Code Se ction 53601 (a) through (e), includes the following:
 Local Municipal Bonds or other indebtedness – maximu m maturity is 5 years from date of purchase, no limit in the amount of the portfolio, and no more than 5% of the total portfolio invested in any one issuer. Preference will be given to California municipal agencies.
 State Bonds or other indebtedness – maxi mum maturity of 5 years from date of purchase, a 5% limit on total investments in the portfolio, and no more than 5% of the total portfolio invested in any one issuer.
 U.S. Treasury Obligations, including notes or other indebtedness secured by the full faith and credit of the Federal Government – maximum maturity of 5 years from date of purchas e, and no limit on amount invested as a % of total portfolio.
 U.S. Agency Securities, including but not limited to issues by federal agencies such as the Federal Farm Credit Bu reau, Government National Mortgage Association, Federal National Mortgage Association, and Federal Home Loan Mortgage Corporation – maximum maturity of 5 years from date of purchase, no limit on amount investment as a % of total portfolio, and no more than 50% of the total portfolio invested in any one issuer.
 Bankers Acceptances - As authorized by Government Code Section 53601 (f), 25% of the City's portfolio may be invested in Bankers Acceptances that are eligible for purchase by the Federal Reserve System. Purchases of Bankers Acceptances may not exceed a 180 day maturity. No more than 5% of the market value of the portfolio shall be placed with any one institution.
 Commercial Paper - As authorized by Government Code Section 53601 (g), 20% of the City's portfolio may be invest ed in commercial paper having a 'A1' rating for the issuers debt, rated by Moody's or Standard and Poors, with maturities not to exceed 90 days. No more than 5% of the portfolio shall be placed with any one institution.
 Negotiable Certificate of Deposit - As authorized in Government Code Section

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9 53601 (h), the City may inve st 30% of its portfolio in negotiable certificates of deposit issued by commercial banks and savings and loan associations with a maturity at issuance of no greater than 5 years. No more than 5% of the market value of the portfolio shall be placed with any one institution.  Repurchase Agreements - As authorized in Government Code Section 53601(l), this investment is an agreement between the local agency and se ller for the purchase of securities on or before a s pecified date for a specified amount. The City may invest in Repurchase Agreements with banks and dealers with whic h the City has entered into a master repurchase contract wh ich specifies terms and conditions of Repurchase Agreements and are fully collat eralized by delivery to an independent third party custodian. In order to conf orm with the provisions of the Federal Bankruptcy Code which provides for the liquidation of securities held as collateral for repurchase agreement, the only securities a cceptable as collateral shall be eligible negotiable certificates of deposit, eligible banker's acceptances, or securities that are direct obligations of, or that are fully guaranteed as to pr incipal and interest by, the United States or any agency of the United States. There is no legal limitation on the amount of the repurchase agr eement. However, the matu rity period cannot exceed one year.
 Medium-Term Notes - As authorized in Government Code Section 53601(o), medium-term notes are considered notes issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any stat e and operating within t he United States. Notes eligible for investment under this subdivision shall be rated in a rating category of "A1” or better by Standard & Poor or by Moody's rating services. Securities must have a maturity of no greater than five years from the date of purchase. No more than 5% percent of the portfolio may be invested in medium-term notes.
 Shares of Beneficial Intere st (mutual funds) - As author ized by Government Section Code 53601(k), issues by diversified management companies, otherwise known as mutual funds, and as defined in Section 23701(m) of the Revenue and Taxation Code, are allowable investm ents. Mutual funds must consist of securities and obligations of the U.S. Go vernment authorized by Sect ion 53601 of the California Government Code. To be eligible for investment, said companies shall either:

1. Attain the highest ranking or the highes t letter and numerical rating provided by not less than two of the three largest nationally recognized rating services, or

2. Have an investment adviser regi stered with the Secu rities and Exchange Commission with not less than five years' experience investing in the securities and obligations as authorized above, and with assets under management in excess of $500,000,000. The price of shares of beneficial interest (mutual funds) shall not include any commission that these companies may charge at the time of purchase or redemption. No more than 10% of the por tfolio may be invested in mutual funds.

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10  Shares of Beneficial Intere st (joint powers aut hority) – Shares of beneficial interest issued by a joint powers authority organized pursuant to Section 6509.7 that invests in the securities and obligat ions authorized in subdivisions (a) to (q), inclusive.

Each share shall represent an equal proportional interest in the underlying pool of securities owned by the joint powers authority. To be eligible under this section, the joint powers authority issuing the shares shall have retained an investment adviser that meets all of the following criteria:
(1) The adviser is registered or exempt from registration with the Securities and Exchange Commission.

(2) The adviser has not less than five years of experience investing in the securities and obligations authorized in subdivisions (a) to (q), inclusive.

(3) The adviser has assets under management in excess of five hundred million dollars ($500,000,000).

 Certificates of Deposit ( non-negotiable) - As authorized in Government Code Section 53601, Certificates of Deposit are fixed term deposits with a financial institution with stipulated interest rates. The City shall deposit funds only with financial institutions which operate in California. Such invest ments are required to be collateralized by financial institutions from 105% to 150% depending on the s pecific security pledged as collateral. These institutions must be insured by the Federal Deposit Insurance Corporation (FDIC) or other federal government insurance banking systems.

Although financial inst itutions are required to co llateralize such deposits, to guarantee preservation of capital, the City shall limit its inve stment in certificates of deposit to the maximum insurable deposit g uaranteed by the FDIC or other federal insurance guarantor. The Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law on July 21, 2010, es tablishing the FDIC-insured amount in effect per depositor of $250, 000. The maximum maturity at issuance may not exceed 1 year.

DOWNGRADED BONDS
In the event that the rating of any investment is downgr aded to ‘A2’, the City Treasurer will immediately notify the Cit y Manager. If it is downgraded to ‘A3’ rating, the City Manager will provide notice to the City Council of the dow ngrade and that the bond will be sold if it falls to “Baa” rating or bel ow, regardless of the loss, unless otherwise directed by City Council resolution at the next available City Council meeting.

COLLATERALIZATION
Collateralization will be required on two types of investments: Cert ificates of Deposit and Repurchase Agreements. Federal and State law gover ns the collateralization requirements for Certificates of Deposit, which under the terms of this policy shall not be less than 102% of the value of the deposit. With regards to Repurchase Agreements, the collateralization level will be in confo rmance with the California Government Code,

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11 and in no event less than 102% of market value of principal and accrued interest.

Collateral will always be hel d by an independent third party with whom the entity has a current custodial agreement. Clearly marked evidence of ownership (safekeeping receipt) must be supplied to the City and retained by the issuing institution at all times.

SAFEKEEPING AND CUSTODY
All security transactions, including collateral for repurchase agreements, entered into by the City shall be conducted on a delivery-versus-payment (DVP) basis. Securities will be held by a third party custodian designated by the City Treasurer and evidenced by safekeeping receipts.

DIVERSIFICATION
The City will diversify its investments by se curity type and institution in accordance with the table of Authorized and Suitable Investm ents. However, 100% of the portfolio may consist of U.S. Treasury, U.S. Agency securities and/or the LAIF investment pool.

MAXIMUM MATURITIES
To the extent possible, the City will attempt to match its investm ents with anticipated cash flow requirements. The City will not invest in securities maturing more than five (5) years from the date of purchase.

INTERNAL CONTROL
The City Treasurer shall establish an annual process of review internally, including assuring that an independent ana lysis by an external auditor be conducted annually to review and perform procedures testing on the City’s cash and investments.

PERFORMANCE STANDARDS
The investment portfolio will be designed to obtain a mark et average rate of return during budgetary and economic cycles, taking in to account the City's risk constraints and cash flow needs.

The City's investment strategy is to obtain a market average ra te of return. The market average rate of return is defined as the average return on one-year U.S. Treasury Notes.

REPORTING
The City Treasurer shall subm it investment reports mont hly to the City Council which should include a list of the por tfolio’s holdings by invest ment asset class, name of institution, purchase date, maturi ty date, call date, par value, amount of deposit or cost of security, amortized book value, current market value of securities, coupon and effective yield, . In addition, the report will indicate the portfolio’s duration, total weighted average maturity and yield. The report will be signed as mandated in compliance with

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12 California Government Code Sections 53607 and 53646.

INVESTMENT POLICY ADOPTION
The above investment policy is adopted by reso lution of the City of Foster City/Estero Municipal Improvement Distric t. The policy is reviewed on an annual basis by the City Treasurer and Administrative Services Dir ector and any modifications made thereto shall be approved by the City Council/District Board.

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13 GLOSSARY

AGENCIES: Federal agency securities.

ASKED: The price at which securities are offered.

BANKERS' ACCEPTANCE (BA): A draft or bill or exchange accepted by a bank or trust company. The accepting inst itution guarantees payment of the bill, as well as the insurer.

BID: The price offered for securities.

BOND RATINGS: bond rati ngs measure quality and safety based on the issuer's financial condition. These rating services ev aluate the likelihood that a debt issuer will be able to meet scheduled interest and principal payments.

Moody's vs. Standard & Poors Bond Ratings
Bond Rating
Grade Risk Moody's
Standard
&
Poor's
Aaa AAA Investment, Highest Quality Lowest Risk
Aa (1-3) AA Investment, Very High Quality Low Risk
A (1-3) A Investment, High Quality Low Risk
Baa BBB Minimum Investment Grade Medium
Risk
Ba BB Junk, Speculative High Risk
B B Junk, Very Speculative Higher Risk
Caa CCC Junk, Default Possible Higher Risk
Ca CC Junk, Default Probable Extreme
Risk
C D Junk, In actual or imminent
default
Highest
Risk

BROKER: A broker brings buyers and selle rs together for a commission paid by the initiator of the transaction or by both sides ; he does not position. In the money market, brokers are active in markets in whic h banks buy and sell money and in interdealer markets.

COLLATERAL: Securities, evident of depos it 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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14 CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a certificate. Certificate of Deposit may be issued in ei ther negotiable or nonnegotiable form. Nonnegotiable certificates cannot be resold in the secondary market and may face penalties for early redemption whereas a negotiable CD may be resold.

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

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

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 mark et instruments that are issued at a discount and redeemed at maturity for full face value, e.g., U.S. Treasury bills.

DIVERSIFICATION: Dividing in vestment funds among a variety of securities offering independent return.

DURATION: A measure of the sensitivity of the asset's price to interest rate movements.

It broadly corresponds to the l ength of time before the a sset is due to be repaid.

Example: the duration of a US Treasury Bill which matures in one year is 1.0. If interest rates immediately move 1% after purchase, the value of the inve stment would also change by 1%.

FEDERAL CREDIT AGENCIES: Agencies of the Federal government set up to supply credit to various classes of institutions and individuals, e.g., S&L's, small business firms, students, farmers, farm cooperatives, and exporters.

FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A federal agency that insures bank deposits, currently up to $100,000 per deposit.

FEDERAL FARM CREDIT BUREAU: The Bur eau issues a variety of Federal Farm Credit Banks Consolidated Syst em wide Debt Securities (F arm Credit Debt Securities) on behalf of the Farm Credit System Ban ks with a broad range of maturities and structures.

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 HOME LOAN BANKS (FHLB): The in stitutions that regulate and lend to savings and loan associations. The Federal Home Loan Banks play a role analogous to that played by the Federal Reserve Banks vis-a-vis member commercial banks.

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15 FEDERAL HOME LOAN MORTGAGE CORPORATION: The FHLMC, or “Freddie Mac”, is a Government-chartered corporation whic h buys qualified mortgage loans from the financial institutions that originate them, securitize s the loans, and distributes the securities through the dealer community. The securities are not backed by the U.S.

Government, however it does operate under a conservatorship that began on September 6, 2008, and conducts its business under t he direction of the Federal Housing Finance Agency (FHFA).

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

GOVERNMENT NATIONAL MORTGAGE ASSO CIATION (GNMA or Ginnie Mae):

Securities guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations and other institutions. Security holder is protected by full faith and credit of the U.S. Go vernment. Ginnie Mae securities are backed by PHA, VA or FMHM mortgages. The term pass-throughs is often used to describe Ginnie Maes.

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 secu rity is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes.

LOCAL AGENCY INVESTMENT FUND (LAIF): The aggregate of all funds from political subdivisions that are placed in the custody of the State Tr easurer for investment and reinvestment.

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

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

MONEY MARKET: The market in which shor t-term debt instruments (bills, commercial paper, bankers' acceptances, etc.) are issued and traded.

PORTFOLIO: Collection of securities held by an investor.

PRUDENT PERSON RULE: An in vestment 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 lega l list. In other states the tr ustee may invest in a security if it is one which would be bought by a prudent person of discretion and intelligence who is seeking a reasonable income and preservation of capital.

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) r egistered securities broker-dealers, banks, and a few regulated firms.

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

REPURCHASE AGREEMENT (Repo): A form of short-term borrowing for dealers in government securities. Technically, it r epresents the simultaneou s sell and repurchase of a security. The dealer sells the combinat ion of securities needed to overcollateralize the investor’s principal investment usually on an overnight basis, and buys them back the following day. For the party selling the security (and agreeing to repurchase it in the future) it is a repo; for the party on the other end of the tr ansaction (buying the security and agreeing to sell in the future), it is a reverse repurchase agreement.

QUALIFIED PUBLIC DEPOSITO RIES: A financial institut ion 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.

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: A gency created by Congress to protect investors in securities transactions by administering securities legislation.

TREASURY BILLS: A non-interest bearing discount security issued by the U.S.

Treasury to finance the national debt. Most b ills are issued to mature in three months, six months, or one year.

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

TREASURY NOTES: Intermediate term coupon bearing U.S. Treasury securities having initial maturities of from one to ten years.

WEIGHTED AVERAGE MATURITY (WAM) – a me asure of the portfolio’s investments with respect to timing of cash flows. Exam ple: If a portfolio had only two securities of equal size, one maturing in 2 years and another in 3 years, the portfolio’s WAM would be 2.5 years. If the 2 year investment was $1 mm and the 3 year investment was $10 mm, the WAM would be 2.9 years.

YIELD: An investment ’s annualized return. The simplest version of yield is calculated using the following formula: [yield = coupo n amount/price.] When a bond is purchased at par (100% of face value), yield is equal to the interest rate. When the price changes, so does the yield.

BOOK YIELD – The yield to maturity at which the investment was purchased.

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17 MARKET YIELD – the yield to maturity of the bond at current market price PORTFOLIO’S NET YIELD – The total in terest received divided by amount invested, plus any gains and minus any losses taken, annualized.

YIELD TO MATURITY – The internal rate of return earned by an investor who buys the bond today at the market price, assu ming that the bond will be held until maturity, and that all coupon and principal payments will be made on schedule. Yield to maturity is actually an estimation of future return, as the rate at which coupon payments can be reinvested when received is unknown.

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1 DATE: June 20, 2023

TO: Mayor and Members of the City Council
President and Members of the Estero Municipal Improvement District (EMID) Board of Directors
FROM: Stefan Chatwin, City Manager

DEPARTMENT: City Manager
SUBJECT: APPROVING A NINTH AMENDMENT TO THE LEASE
AGREEMENT BETWEEN V.B. GOLF LLC AND THE CITY OF

FOSTER CITY/ESTERO MUNICIPAL IMPROVEMENT DISTRICT

AND AUTHORIZING THE MAYOR/BOARD PRESIDENT TO
EXECUTE THE AMENDMENT; AND FINDING THE AMENDMENT

TO THE LEASE NOT A PROJECT AND IF A PROJECT, IS

EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY

ACT (CEQA) PURSUANT TO CEQA GUIDELINES SECTION
15061(B)(3)

RECOMMENDATION
It is recommended that City Council/EMID Board of Directors adopt the attached resolutions approving the Ninth Amendment to the Lease between V.B. Golf LLC and the City of Foster City/Estero Municipal Improvement District and authorize the Mayor/Board President to execute the Ninth Amendment; and find the Ninth Amendment to the Lease is not a project under CEQA, and if a project, it is exempt from CEQA pursuant to CEQA Guidelines section 15061 (b)(3).

EXECUTIVE SUMMARY
On June 10, 1996 the City of Foster City/EMID entered into a lease agreement with V.B. Golf LLC (“V.B. Golf”) for property located at 2401 East Third Avenue, Foster City (“Lease”). The Lease provided for the construction and operation of a 9-hole golf course and associated facilities by V.B. Golf. The Lease was initially for a term of 15 ½

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1 years but the term has been extended twice, most recently on March 15, 2021 for an additional two years, with an option for a third year.

It is now recommended that the City Council/EMID Board of Directors review and approve a Ninth Amendment to the Lease granting an extension of the term for an additional three years with a one year option for renewal to be exercised in the City/EMID’s sole discretion. The proposed amendment is attached as Attachment 3.

BACKGROUND
On June 10, 1996 the City/EMID entered into the Lease with V.B. Golf. Pursuant to the Lease, V.B. Golf was required to construct the following improvements on the leased property (“Premises”):

1. Practice Tees

2. Nine hole golf course

3. Putting course

4. Pro shop

5. Restaurant/Bar and other related facilities

6. Parking areas and roads to service the golf improvements

7. Landscaping, walkways, and other amenities and infrastructures to service the Improvements, such as fencing, maintenance/equipment building, water conservation irrigation, lighting, utilities, storm drainage, and other improvements as required for the operation of the facilities, including pedestrian pathways and traffic improvements.

The Lease Section 6.2, Conditions of Use, Subsection (g) required that the Premises be available for use by the general public; provided, however that V.B. Golf was allowed to open the facility, free of charge (or at a discount) for use by non-profit community oriented organizations such as City of Foster City or school youth groups, if V.B. Golf notified the City in writing fifteen (15) days prior to the activity (hereinafter “Special Events”). V.B. Golf was also required to cooperate with the City to promote golf and related activities, tournaments, and classes consistent with the best public use of the golf driving range component of the facilities.

The Lease Section 7, Improvements, Subsection 7.1, Prior Consent for Improvements, requires that V.B. Golf obtain written approval from the City/EMID before undertaking any alterations or improvements to the Premises. Subsection 7.2, Ownership of Improvements, provides that all buildings, improvements, fixtures and facilities constructed by V.B. Golf become the property of the City/EMID at the expiration of the Lease subject only to the buy-out or early termination provisions of the Lease.

Since 1996, the Lease has been amended a total of eight times. The First through Fifth Amendments and the Seventh Amendments made relatively minor changes to the

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1 Lease provisions to allow various subleases for retail and restaurant operations and allow live entertainment and music in the restaurant and bar. 2006 Amended Lease
The Sixth Amendment, which is dated January 1, 2006 made more substantial changes. Some of the more significant changes are summarized as follows:
•Amends Section 1.2, Lease Term, to specify that the “Amended Lease Term” shall be from July 1, 1996 to December 31, 2021 (25 1/2 years). •Amends Section 5.1, Monthly Rent- Minimum Rent or Percentage Rent to specify that the annual minimum rent shall be $350,000 or a Percentage Rent as defined in section 5.3, whichever amount is higher.
•Amends Section 6.2, Conditions of Use, subsection (g) to expand uses of facilities to require V. B. Golf to do the following:

1. Offer the lowest available published rate to all Foster City residents.

2. Offer a 30% bonus on $100 range cards to all Foster City residents.

3. Sponsor and manage an eight week Fall and eight week Spring golf team from the public middle school(s) located in Foster City. During each eight week period, V.B. Golf was required to conduct try-outs, practice and league play.

4. Offer free practice for up to twenty-five Foster City public elementary school children ten years and older as an after-school program or as part of the school’s physical education curriculum during the school year.

5. Host, at its cost, two Foster City golf events per year. Each golf event is for a maximum of sixty players who are allowed three hours of course time and one hour of time on the driving range.

6. Offer four free clinics per month for Foster City residents to be coordinated with the Foster City Parks and Recreation Department.

A maximum of ten free enrollments per clinic to be offered. Each clinic to be at least an hour in length.

7. Sponsor one $500 scholarship to be awarded to a student attending a public middle school in Foster City and selected by the City and/or School District.

8. Donate for City awards programs twenty-five range cards to the City redeemable for one free medium bucket of range balls annually.

9. Donate free one-hour golf instruction to the City Employee of the Quarter or an employee designated in a similar recognition program during each year of the Amended Lease term.

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1 •Amends Section 7.1, Consent for Improvements to add subsection (a) to specify in 2006 process for submittal of plans for review and approval of work for interior office/retail/restaurant space and driving range and golf course. Also adds subsection (b) to specify in 2007 process for submittal and plan for review and approval of all wind screens to protect driving range stalls. •Adds Section 7.4, Capital Improvement Fund (CIRF), which requires effective, January 1, 2008, 4% of all revenue generated from annual golf operations (driving range, golf course green fees, and short game practice center) be placed in CIRF to fund additional improvement projects through the Term of the Amended Lease.

Expenditures for capital improvements funded out of this CIRF shall be approved in writing by the City prior to construction which approval shall not be unreasonably withheld, and any funds remaining in the CIRF on December 31, 2021 shall inure to the benefit of the City.
2008 Amended Lease
The Eighth Amendment to the Lease, which is dated March 15, 2021 also made more substantive changes. Some of the more significant changes are summarized as follows:
•Amends Section 1.2, Amended Lease Term, to extend term to term of 27 ½ years to commence on July 1, 1996 and terminate on December 31, 2023 unless City/District in its sole discretion provides V.B. Golf with written notice no later than June 30, 2023 that the lease term is extended to December 31, 2024. •Amends Section 5.1, Monthly Rent-Minimum Rent or Percentage Rent, and Section

5.4, Minimum Rent, to specify that the Lessee shall pay the Minimum Rent of $350,000 or a Percentage Rent, whichever is higher.
•Amends Section 6.2, Conditions of Use, Subsection(g) to specify effective date of January 1, 2006 and reference to Amended Lease. Amends subsection (l) to specify July 1st as deadline for submission of written schedule to City fore operation hours and prices charged for all goods and/or services.
•Amends Section 7.1, Consent for Improvements, to specify that during the term of the Amended Lease V.B. Golf shall be responsible to fund and construct all improvements, including those necessary to address public safety issues.

ANALYSIS

The approval of the Ninth Amendment is not subject to review under the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21000,

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1 et seq. and the CEQA Guidelines (14 Cal. Code Regs. §§ 15000 et. seq.), including without limitation, Public Resources Code section 21065 and California Code of Regulations 15378 as this is not a “project” that may cause a direct, or reasonably foreseeable indirect, physical change in the environment and if a “project,” is exempt under the “common sense” exception (14 Cal. Code Regs. § 15061(b)(3)) because it can be seen with certainty that there is no possibility that this action may have a significant effect on the environment.

V.B. Golf is seeking a further extension of the Lease and is also seeking approval of installation of a food trailer on the Premises in order to facilitate a new restaurant food service at the driving range. V.B. Golf has submitted an application to the Planning Department for consideration of a staff issued Use Permit. The installation of the improvement (the food trailer) and the sublease needs to be approved by the City/EMID pursuant to the terms of the Lease. The approvals required by the Lease are separate from any approvals or permits required by the City’s Planning and Building Departments.

At the direction of the Council, the City/EMID Manager has engaged in discussions with V.B. Golf and both parties have negotiated the following terms for the Ninth Amendment:

1. Extend the term for three years to expire on December 31, 2026, with an option for City/EMID to extend to December 31, 2027;

2. Increase the minimum rent from $350,000 to $450,000;

3. Increase the contribution made by V.B. Golf to the CIRF from 4% to 5%;

4. Allow installation of food trailer on the Premises and sublease with City/EMID to receive 5% of rent paid by Sublessee to V.B. Golf, conditioned upon V.B.Golf obtaining necessary use permit and any other necessary authorizations to operate food trailer.

Attached for the City Council/EMID Board of Director’s review are the resolutions approving the Ninth Amendment to the Lease. If approved, the foregoing revisions would go into effect including the extension of the term of the Amended Lease to allow operations to continue until December 31, 2026, with the City/EMID holding an option to extend the Lease until December 31, 2027.

California Environmental Quality Act
The approval of the Ninth Amendment is not subject to review under the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21000, et seq. and the CEQA Guidelines (14 Cal. Code Regs. §§ 15000 et. seq.), including

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1 without limitation, Public Resources Code section 21065 and California Code of Regulations 15378 as this is not a “project” that may cause a direct, or reasonably foreseeable indirect, physical change in the environment and if a “project,” is exempt under the “common sense” exception (14 Cal. Code Regs. § 15061(b)(3)) because it can be seen with certainty that there is no possibility that this action may have a significant effect on the environment.

FISCAL IMPACT
There will be an increase in the minimum rent from $350,000 to $450,000.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Smart Planning, Development, and the Local Economy
ATTACHMENTS:

Attachment 1 – City Resolution
Attachment 2 – EMID Resolution
Attachment 3 – Proposed Ninth Amendment

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4891-5982-1672 v2
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3 RESOLUTION NO. ____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY APPROVING A NINTH AMENDMENT TO THE LEASE AGREEMENT BETWEEN V.B.

GOLF LLC AND THE CITY OF FOSTER CITY/ESTERO MUNICIPAL IMPROVEMENT

DISTRICT AND AUTHORIZING THE MAYOR TO EXECUTE THE NINTH AMENDMENT

AND FINDING THE AMENDMENT TO THE LEASE NOT A PROJECT AND IF A

PROJECT, IS EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) PURSUANT TO CEQA GUIDELINES SECTION 15061(B)(3)

CITY OF FOSTER CITY
WHEREAS, the City of Foster City entered into a lease agreement on June 10, 1996 with V.B. Golf LLC for the construction and operation of a 9-hole golf course and associated facility at 2401 East Third Avenue, Foster City, California (“Lease”); and WHEREAS, since 1996, the Lease has been amended a total of eight times with the First through Fifth Amendments and the Seventh Amendments made relatively minor changes to the Lease provisions to allow various subleases for retail and restaurant operations and allow live entertainment and music in the restaurant and bar; and WHEREAS, in 2006, the City approved a Sixth Amendment to the Lease extending the term of the Lease to December 31, 2021, establishing the minimum rent for a term of the lease at $350,000, requiring that V.B. Golf LLC offer its lowest published rates to residents and provide additional community benefits, and requiring V.B. Golf LLC to establish a Capital improvement Reserve Fund for capital improvements; and WHEREAS, in 2008, the City approved a further extension of the lease for an additional two years until December 31, 2023, with the City having an option to extend the lease for a third year, in its discretion, until December 31, 2024 and the City authorized use of the CIRF funds to assist in construction of driving range improvements; and WHEREAS, the City/District and V.B. Golf LLC desire to enter into another amendment to the Lease to, among other things, extend the Amended Lease term to December 31, 2026, with the City/District holding an option to extend the Lease until December 31, 2027; and
WHEREAS, this Ninth Amendment is not subject to the California Surplus Lands Act guidelines for disposition of surplus lands because, among other things, the Lease was entered into prior to 2019.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FOSTER CITY as follows:

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4891-5982-1672 v2
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3 1. The City Council finds that approval of the Ninth Amendment is not subject to review under the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21000, et seq. and the CEQA Guidelines (14 Cal. Code Regs. §§ 15000 et. seq.), including without limitation, Public Resources Code section 21065 and California Code of Regulations 15378 as this is not a “project” that may cause a direct, or reasonably foreseeable indirect, physical change in the environment and if a “project,” is exempt under the “common sense” exception (14 Cal. Code Regs. § 15061(b)(3)) because it can be seen with certainty that there is no possibility that this action may have a significant effect on the environment.

2. The City Council does hereby approve the Ninth Amendment to the Lease between V.B. Golf LLC and the City of Foster City/Estero Municipal Improvement District and authorizes the Mayor to execute the Ninth Amendment in the form attached hereto, with minor revisions that may be approved by the City Attorney, and to execute any other necessary documents to effectuate the terms of the Ninth Amendment.

PASSED AND ADOPTED as a Resolution of the City Council of the City of Foster City at the special meeting held on the 20th day of June, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_________________________________

JON FROOMIN, MAYOR
ATTEST:
______________________________
Priscilla Schaus, City Clerk

6.12 Attachment 1 - City Resolution

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9 0
2 RESOLUTION NO. ____________

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ESTERO MUNICIPAL

IMPROVEMENT DISTRICT APPROVING A NINTH AMENDMENT TO THE LEASE AGREEMENT BETWEEN V.B. GOLF LLC AND THE CITY OF FOSTER CITY/ESTERO

MUNICIPAL IMPROVEMENT DISTRICT AND AUTHORIZING THE BOARD

PRESIDENT TO EXECUTE THE NINTH AMENDMENT AND FINDING THE

AMENDMENT TO THE LEASE NOT A PROJECT AND IF A PROJECT, IS EXEMPT

FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) PURSUANT TO CEQA GUIDELINES SECTION 15061(B)(3)

ESTERO MUNICIPAL IMPROVEMENT DISTRICT
WHEREAS, the Estero Municipal Improvement District entered into a lease agreement on June 10, 1996 with V.B. Golf LLC for the construction and operation of a 9-hole golf course and associated facility at 2401 East Third Avenue, Foster City, California (“Lease”); and
WHEREAS, since 1996, the Lease has been amended a total of eight times with the First through Fifth Amendments and the Seventh Amendments made relatively minor changes to the Lease provisions to allow various subleases for retail and restaurant operations and allow live entertainment and music in the restaurant and bar; and WHEREAS, in 2006, the Board of the Estero Municipal Improvement District approved a Sixth Amendment to the Lease extending the term of the Lease to December 31, 2021, establishing the minimum rent for a term of the lease at $350,000, requiring that V.B. Golf LLC offer its lowest published rates to residents and provide additional community benefits, and requiring V.B. Golf LLC to establish a Capital improvement Reserve Fund for capital improvements; and
WHEREAS, in 2008, the Board of the Estero Municipal Improvement District approved a further extension of the lease for an additional two years until December 31, 2023, with the Estero Municipal Improvement District having an option to extend the lease for a third year, in its discretion, until December 31, 2024 and authorized use of the CIRF funds to assist in construction of driving range improvements; and WHEREAS, the City of Foster City and the Estero Municipal Improvement District and V.B. Golf LLC desire to enter into another amendment to the Lease to, among other things, extend the Amended Lease term to December 31, 2026, with the City/District holding an option to extend the Lease until December 31, 2027; and WHEREAS, this Ninth Amendment is not subject to the California Surplus Lands Act guidelines for disposition of surplus lands because, among other things, the Lease was entered into prior to 2019.

6.12 Attachment 2 - EMID Resolution

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2 NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE ESTERO MUNICIPAL IMPROVEMENT DISTRICT as follows:

1. That approval of the Ninth Amendment is not subject to review under the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21000, et seq. and the CEQA Guidelines (14 Cal. Code Regs. §§ 15000 et. seq.), including without limitation, Public Resources Code section 21065 and California Code of Regulations 15378 as this is not a “project” that may cause a direct, or reasonably foreseeable indirect, physical change in the environment and if a “project,” is exempt under the “common sense” exception (14 Cal. Code Regs. § 15061(b)(3)) because it can be seen with certainty that there is no possibility that this action may have a significant effect on the environment.

2. The Board hereby approve the Ninth Amendment to the Lease between V.B. Golf LLC and the City of Foster City/Estero Municipal Improvement District and authorizes the Board President to execute the Ninth Amendment in the form attached hereto, with minor revisions that may be approved by the Attorney for the Estero Municipal Improvement District, and to execute any other necessary documents to effectuate the terms of the Ninth Amendment.

PASSED AND ADOPTED as a Resolution of the Board of Directors of the Estero Municipal Improvement District at the special meeting held on the 20th day of June, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_________________________________
JON FROOMIN, President
ATTEST:
______________________________
Priscilla Schaus, District Secretary

6.12 Attachment 2 - EMID Resolution

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4858-4840-5098 v1

NINTH AMENDMENT TO THE LEASE AGREEMENT
DATED JUNE 10, 1996, BETWEEN CITY OF FOSTER

CITY/ESTERO MUNICIPAL IMPROVEMENT DISTRICT AS

LANDLORD AND VB GOLF LLC AS TENANT
T
he Lease Agreement (hereinafter the “Lease”) which was made and entered on the 10TH day of June, 1996 by and between the City of Foster City, a municipal corporation and the Estero Municipal Improvement District (hereinafter collectively “Lessor”), a political subdivision of the State of California, and VB Golf LLC, a Delaware corporation (hereinafter the “Lessee”), is hereby amended as follows (the Lease, as amended hereby, is referred to as the “Amended Lease”). Lessor and Lessee may be referred to individually as “Lessor” (also “City” or “District”) or “Lessee” (also “V.B. Golf”) or collectively as “Parties”.

ECITALS
This Amended Lease is entered into with reference to the following facts and circumstances:

A. L
essee continues to provide quality golf services in the City of Foster City; and B. L
essee and Lessor desire to extend the Lease for an additional period of three (3) years with one (1) optional year at the sole discretion of the City; and C. L
essee and Jeremy Chang (hereinafter “Sublessee”) propose to enter into a sublease agreement (hereinafter “Sublease”), which a draft is attached hereto and hereinafter incorporated by reference as Exhibit A, for purposes of permitting Sublessee to sell food from a trailer owned by Lessee on the Premises; and
D. T
he Lease provides in section 10.3 that “Lessee shall not without prior written consent of Lessor, which consent shall not be unreasonably withheld or delayed, either voluntarily or by operation of law, assign, mortgage, hypothecate or otherwise transfer this Lease or any interest in this Lease or permit the use of the Premises by any person or persons other than the Lessee to sublet the Premises or any part thereof”; and
E. L
essee has applied to the City of Foster City for a staff-level Use Permit Modification to authorize the installation of the 8ft x 16 ft trailer on the Premises(“Trailer”). Attached hereto and hereinafter incorporated as Exhibit B are the plans describing the proposed Trailer and location on the Premises; and
F. L
essor and Lessee desire to amend the Lease to authorize the sublease and improvements as required by the Lease and also amend the Base Rent from $350,000 to $450,000 to reflect current market rates and increase the capital set aside amounts from 4% to 5%.

AGR
EEMENT

1. Recitals. The Parties agree are true and correct and hereby incorporated as terms of this Amended Lease.

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4858-4840-5098 v1

2. Amendments.

The Parties agree that the following Sections of the Lease are amended as identified below. a. S ECTION ONE: PREMISES AND TERM OF LEASE is amended by amending Section 1.2 to read in its entirety as follows:
“1.2 Amended Lease Term: Subject to Section Two and to the termination provisions of Section Eleven below, and the rights of Lessee as set forth in subparagraphs (a), (b) and (c) hereof, this Amended Lease shall be for a term thirty and one-half (30 1/2) years (the “Amended Lease Term”) from July 1, 1996 (hereinafter, the “Commencement Date”) and shall continue to and terminate at 11:59 p.m. local time on December 31, 2026 (hereinafter, the “Expiration Date”) unless Lessor, in its sole discretion, provi des Lessee with written notice no later than June 30, 2026, that the Amended Term is extended to December 31, 2027.

N
otwithstanding the foregoing, Lessee and Lessor shall be bound by all terms, covenants and conditions of this Amended Lease from the date that this Amended Lease is first entered into, as written hereinabove.
(a) Rights with Respect to Future Operation of the Premises as a Golf Course by Lessor. Provided no material obligations of Lessee under this Amended Lease are then in default nor has Lessee failed to timely cure any matter under this Amended Lease which if uncured would result in a material default hereunder, then at any time between twelve (12) and nine (9) months prior to December 31, 2026 , Lessee may request Lessor to indicate whether Lessor intends to continue golf course operations.

Lessor commits to provide an answer within 30 days. Within 30 days of receipt of the answer, Lessee shall indicate whether it intends to exercise its right of first negotiation in the event that Lessor indicates an intention to continue golf operations. (b) Right of First Negotiation. Lessor in response to Lessee’s inquiry shall indicate whether the golf course is to be operated directly by the City employing a manager, through the use of a concessionaire, or under a lease. If Lessee so requests in writing, Lessor agrees to provide Lessee an advance copy of any terms on which it proposes to solicit a management agreement, concession agreement or lease agreement. Lessee will have 60 days to accept those terms which, if not so accepted, will be then offered to the public. If, as a result of such a public offering, Lessor receives and accepts an offer equal to 95% or better of the terms declined by Lessee, then Lessee shall have no further rights or entitlement with respect to the lease, operation or concession of this property. Lessor may not offer the management, concession or lease of this Property on any terms less than 95% of those terms declined by Lessee without first showing Lessee the revised terms and giving Lessee an additional period of 30 days in which to accept or reject those terms, after which the process will continue.”

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4858-4840-5098 v1
b. SECTION FIVE: LEASE RENTAL PAYMENTS is amended by amending Sections 5.1 and 5.4 to read in their entirety as follows:

“5.1 Monthly Rent - Minimum Rent or Percentage Rent: In consideration for the rental of the Premises by Lessor to Lessee, beginning on January 1, 2024, Lessee shall pay the yearly Minimum Rent (as defined in Section 5.4) of Four Hundred Fifty Thousand Dollars ($450,000) or a Percentage Rent as defined in Section 5.3; whichever amount is higher.”

“5.4 Minimum Rent: Lessee shall pay, on a monthly basis or on the basis herein set forth, the Minimum Rent. The sum of Four Hundred Fifty Thousand Dollars ($450,000) shall be the yearly Minimum Rent beginning on or after January 1, 2024 and continuing until the expiration of the Amended Lease term or any extension or renewal thereof. The amount of Minimum Rent payable for each calendar month fr om and after January 1, 2024 shall be based upon the following percentages of the applicable Minimum Rent:

January 3%
February 5%
March 8%
April 10%
May 12%
June 12%
July 12%
August 12%
September 10%
October 9%
November 4%
December 3%
Such monthly portion of Minimum Rent shall be payable for the preceding month on the fifteenth (15th) day of each calendar month for so long as the tenancy continues.” c. SECTION SIX: USE OF PREMISES is amended by amending Section 6.1 to read in its entirety as follows:
“6.1 Use of Premises: For and during the term of this Amended Lease, and any extension or renewal thereof, Lessee shall use the Premises solely and exclusively for operating a golf driving range, golf course, putting course, golf lessons, restaurant and bar related facilities, including food trailers, sale of golf equipment and soft goods, related maintenance facilities and related recreational activities.”

6.12 Attachment 3 - Proposed Ninth Amendment

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Foster City City CouncilJune 20, 2023

Foster City City Council
June 20, 2023