Agenda — Gridley City Council, November 4, 2024

GRIDLEY CITY COUNCIL AGENDA: Regular Meeting of 11-4-24 Page 1 of 4 “Our purpose is to continuously enhance our community’s vitality and overall quality of life. We are committed to providing high quality, cost-effective municipal services and forming productive partnerships with our residents and regional organizations. We collectively develop, share, and are guided by a clear vision, values, and meaningful objectives.” The Public is encouraged to attend and participate in person. Comments from the public on agenda items will be accepted until 4 pm on November 4th, 2024, via email to [email protected] or via the payment/document drop box at Gridley City Hall and will be conveyed to the Council for consideration.

You may view using the following link, ID, and passcode:
https://us06web.zoom.us/j/84590817923?pwd=UK3yxiv4tXmVmPWWaJL4Xg177BqCY8.1 Webinar ID: 845 9081 7923
Passcode: 653417
Or Telephone:
+1 669 444 9171 US
+1 346 248 7799 US
CALL TO ORDER - Mayor Farr

ROLL CALL
PLEDGE OF ALLEGIANCE – Vice Mayor Johnson
PROCLAMATION – Homeless Youth Awareness Month
INTRODUCTION OF NEW OR PROMOTED EMPLOYEES - None
COMMUNITY PARTICIPATION FORUM - Members of the public may address the City Council on matters not listed on the agenda. The City Council may not discuss nor take action on any community participation item brought forward by a member of the community. Comments are requested to be limited to three (3) minutes.

CONSENT AGENDA

1. Procurement Policy Update
Introduction Purchase Policies and Procedures and Introduction of First Reading by Title Only of Ordinance 850-2024: An Ordinance of the City Council of the City of Gridley Amending Chapter 3.16 of the Gridley Municipal Code Relating to Procurement Policy Recommended Action(s):

Gridley City Council – Regular Meeting Agenda
Monday November 4, 2024; 6:00 pm
Gridley City Hall, 685 Kentucky Street, Gridley, CA 95948 GRIDLEY CITY COUNCIL AGENDA: Regular Meeting of 11-4-24 Page 2 of 4 a. Staff respectfully requests that the Mayor and City Council review and accept the introduction and first reading by title only Ordinance 850-2024 the updates to the Gridley Municipal Code related to procurement policy to comply with the California Uniform Public Construction Cost Accounting Act (“CUPCCAA”) b. Review and Approve the Purchasing Polices and Procedures

ITEMS FOR CONSIDERATION

2. Transmission Rate Case Program through NCPA
Council consideration of the Transmission Rate Case Program authorizing NCPA to advocate on behalf of the City in rate cases and proceeding affecting transmission costs.

Recommended Action(s):
a. Approve Resolution 2024-R-042: Approving the City’s participation in the Transmission Rate Case Program through an agreement with the Northern California Power Agency (NCPA) to help manage and limit Gridley's exposure to rising transmission costs associated with CAISO and other markets. b. Authorize the City Administrator to execute the agreement with NCPA and ensure funding allocation within the FY budget

3. Fire Department Contract Update: 66-Hour Work Week
Council consideration of the first contract amendment with the California Department of Forestry and Fire Protection (CalFire) to allow for the recent CAL HR negotiated labor agreement to reduce the firefighter workweek from 72 hours to 66 hours.

Recommended Action(s):
a. Staff respectfully requests that the City Council approve Resolution 2024-R-043 : a Resolution of the City of Gridley Authorizing the amendment of California Department of Forestry and Fire Protections Contract for FY 24/25 approving the “First Amendment” to the contract agreement (No. 2CA06877) with the California Department of Forestry and Fire Protection (CALFIRE) for services from July 1, 2024, through June 30, 2025. This amendment adds $142,042 to the existing contract, bringing the maximum total amount to $1,250,114
b. Alternatively, the Council may direct staff to negotiate a different agreement with CALFIRE to achieve a reduced level of service at a lower cost.

4. Quarterly Budget Review – Informational Only
Council to receive a quarterly budget review from Finance Director.

Recommended Action(s):
a. Receive information, no other action is required
GRIDLEY CITY COUNCIL AGENDA: Regular Meeting of 11-4-24 Page 3 of 4

5. Contract for Interim Planning Services
Council to review the independent contract agreement for interim planning services with Don Rust.

Recommended Action(s):
a. Approve the Independent Contract Agreement for interim planning services with Don Rust.
b. Authorize the City Administrator to amend contract (if necessary) CalPERS required verbiage, execute the final contract for planning services and assign task orders through said agreement.
c. Authorize the City Administrator, through an RFP process, bring forth Planning Consulting Services for consideration for major planning projects such as the General Plan Update.

COUNCIL COMMITTEE REPORTS - Brief reports on conferences, seminars, and meetings attended by the Mayor and City Council members, if any.

CITY ADMINISTRATOR REPORTS - Brief updates and reports on conferences, seminars, and meetings attended by the City Administrator, if any.

DEPARTMENT UPDATE REPORTS – Brief updates and reports on conferences, seminars, and meetings attended by Department Managers, if any
POTENTIAL FUTURE CITY COUNCIL ITEMS - (Appearing on the Agenda within 30 days):

The Village at Eagle Meadows 11/18/2024
Travel Policy 11/18/2024
Energy Efficiency Contract Review 11/18/2024
Planning Commission Appointment 11/18/2024
CLOSED SESSION - None
ADJOURNMENT – adjourning to a regular meeting on November 18th, 2024.

NOTE 1: POSTING OF AGENDA- This agenda was posted on the public bulletin board at City Hall at or before 6:00 p.m., November 1st, 2024. This agenda along with all attachments is available for public viewing online at www.gridley.ca.us and at the Administration Counter in City Hall, 685 Kentucky Street, Gridley, CA.

NOTE 2: REGARDING UNSCHEDULED MATTERS – In accordance with state law, it shall be the policy of this Council that no action shall be taken on any item presented during the public forum or on unscheduled matters unless the Council, by majority vote, determines that an emergency situation GRIDLEY CITY COUNCIL AGENDA: Regular Meeting of 11-4-24 Page 4 of 4 exists, or, unless the Council by a two-thirds vote finds that the need to take action arose subsequent to the posting of this agenda.

Proclamation: Homeless Youth Awareness Month
WHEREAS, The California Department of Education reports there were 246,480 homeless students, including some 1,608 K-12 students in Butte County enrolled during the 2022/23 school year; and,
WHEREAS, Approximately 25% of youth exiting foster care will experience homelessness; and,
WHEREAS, Natural disaster and lack of affordable housing have exacerbated youth homelessness across rural California; and,
WHEREAS, A high percentage of homeless youth have been physically, sexually and/or emotionally abused by their guardians and are frequently re-victimized and exploited while living on the streets and in shelters; and,
WHEREAS, LGBTQ+ young adults are at a 120% higher risk of homelessness when compared to their peers, and comprise about 40% of the unaccompanied homeless youth population; and,
WHEREAS, due to the lack of stable housing, homeless youth face great difficulty in accessing stabilizing, and succeeding in school, reducing the likely hood of successful graduation; and,
WHEREAS, the citizens of Gridley, California are the key to preventing youth homelessness by acting as mentors and role models for youth, guiding them towards available resources, productive choices and creating opportunities for youth to successfully transition to adulthood;
NOW, THEREFORE, I, Michael W. Farr, Mayor of the City of Gridley by virtue of the authority vested in me, do hereby proclaim November 2024 as Homeless Youth Awareness Month in the City of Gridley.
________________________________
Michael W. Farr, City of Gridley Mayor

City Council Agenda Item #1
Staff Report
Date: November 4, 2024
To: Mayor and City Council
From: Martin Pineda, Finance Director
Subject: Ordinance 850-2024: Introduction and First Reading by Reading of Title Only of Ordinance 850-2024 An Ordinance of the City Council of the City of Gridley Amending Chapter 3.16 of the Gridley Municipal Code Relating to Procurement Policy Approval of Purchasing Policies and Procedures
Recommendation
Staff respectfully requests that the Mayor and City Council review and accept the introduction and first reading by title only Ordinance 850-2024 the updates to the Gridley Municipal Code to comply with the California Uniform Public Construction Cost Accounting Act (“CUPCCAA”) and approve the Purchasing the Policies and Procedures.

Background
On 07/03/1989, the City elected to be subject to the California Uniform Construction Cost Accounting Commission (“CUCCA”). Per California Public Contract Code 22032 and Assembly Bill 2249, any City Project that is estimated to be below $200,000 is subject to the Informal Bidding Procedures set forth by CUCCA. Additionally, the City shall use the amounts stated in the most recent updates to the CUPCCAA.

All trade categories are subject to Informal Bidding Procedures.

The City adopted CUPCCAA standards in 1989, and since then, the procurement ordinance has followed the guidelines set forth by the Act. However, recent updates to the law (most recently in 2022) have increased the threshold for informal bidding, making it necessary to update the City’s procurement ordinance to reflect these changes.

GMC 3.16.055 – Council Review of Fixed Asset Purchases:

Bidding Limits and Requirements:
- $0 - $5,000
o Authorized Staff may purchase.
o No competition Required.
o Invoice/PO to be retained by Finance.
- $5,000.01 – $25,000
o Department Head Authorization Required.
o 3 informal bids (if possible) OR Sole Source Justification. o Documents retained by Finance and Operating Department. - $25,000.01 - $50,000
o Finance Director and Department Head Authorization Required. o 3 informal bids (if possible) OR Sole Source Justification. o Documents retained by Finance with Purchase Order.
x Regular
Special
Closed
Emergency
- $50,000.01 - $200,000
o City Administrator, Finance Director, and Department Head authorization required. o 3 informal bids (if possible) OR Sole Source Justification. o Documents retained by Finance with Purchase Order.
- $200,000.01 +
o Public Works projects exceeding $200,000.01 will follow the formal bidding process and will require Council review and approval.

GMC 3.16.100 – Informal Bid Procedures:
- Updates of the language for a more comprehensive detail and update to the code.

GMC 3.16.200 – Emergency Purchases Including Public Projects (NEW):
- Allows City Staff to purchase supplies, materials, equipment or contractual services without council approval, in the event of an emergency.
- Pursuant to Public Contract code § 22050, in the event of an emergency for public projects, the authority to order any action required by an emergency to procure the necessary equipment, services, and supplies, without giving notice to bids to let contracts, is delegated to the City Administrator.
- If emergency action is taken, City Administrator must give reasons that justify the emergency purchase at the next council meeting, that will be no later than 14 days.

Fiscal Impact
No fiscal impact.

Attachments
Ordinance 850-2024
Purchasing Policies and Procedures
ORDINANCE NO. 850-2024
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF GRIDLEY AMENDING CHAPTER 3.16 OF

THE GRIDLEY MUNICIPAL CODE RELATING TO PROCUREMENT POLICY WHEREAS, the City of Gridley seeks to update and clarify procurement policies to reflect modern practices and streamline procedures for purchases, informal bidding, and emergency procurements;
WHEREAS, these amendments will improve the efficiency and transparency of procurement processes, including purchasing thresholds, informal bidding processes, and emergency purchasing protocols;
NOW, THEREFORE, the City Council of the City of Gridley does ordain as follows:

SECTION 1: Amendment to Chapter 3.16.055 – Council Review of Fixed Asset Purchases

1. Purchases up to $5,000: Authorized employees may use small purchase orders or procurement cards (Cal-Card), as designated by the Purchasing Officer, for purchases up to $5,000.

2. Purchases up to $25,000: For purchases greater than $5,000 and up to $25,000, departments may utilize a large purchase order in the open market. At least three vendors should be solicited, with awards going to the vendor with the lowest acceptable quotation. Records of quotations and vendor information shall be maintained as public records.

3. Purchases up to $50,000: Purchases exceeding $25,000 and up to $50,000 require the Purchasing Officer’s authorization and an informal bid process. Three or more vendors must be solicited, with awards going to the vendor with the lowest acceptable quotation. All quotations and vendor details shall be kept as public records.

4. Purchases up to $200,000: For purchases between $50,000 and $200,000, the Purchasing Officer shall follow the informal bid process, ensuring solicitation from at least three vendors and awarding to the lowest acceptable quotation. Documentation of the quotations and vendor information shall be maintained as public records.

5. Soliciting Informal Bids: The Purchasing Officer is responsible for soliciting informal bids by mail, email, phone inquiries, internet research, or other appropriate methods.

Records of all informal bids and purchases shall be maintained as public records.

SECTION 2: Amendment to Chapter 3.16.100 – Informal Bid Procedures • Informal Bidding for Public Projects: In accordance with the Uniform Public Construction Cost Accounting Act, informal bidding may be used for public projects as defined under Public Contract Code § 22002(c) and § 22032. • List of Qualified Contractors: The City will maintain a list of qualified contractors per Public Contract Code § 22034. Notifications for informal bids shall be sent to all contractors on this list and relevant trade journals, with additional notifications at the City's discretion.
• Submission and Notification Requirements:
o Notices inviting informal bids shall be sent at least 10 calendar days before the bid due date.
o The notice must include a general project description, information on obtaining detailed project information, and submission deadlines.

SECTION 3: Addition of Chapter 3.16.200 – Emergency Purchases Including Public Projects

1. Emergency Purchases: In cases of emergencies requiring immediate procurement of supplies, materials, equipment, or services, the Purchasing Officer may make necessary purchases in the open market at the lowest obtainable price, even if costs exceed standard limits. A report explaining the emergency and purchases made will be submitted to the Council and made part of the public record.

2. Emergency Actions for Public Projects: Pursuant to Public Contract Code § 22050, the City Administrator is authorized to take emergency actions without a competitive bidding process. The City Administrator must report to the Council at the next scheduled meeting, detailing the reasons for bypassing the competitive bid process. The Council will review the emergency actions and determine by a four-fifths vote whether to continue or terminate the action.

SECTION 4: Severability
If any section, subsection, sentence, clause, or phrase of this ordinance is, for any reason, held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of the ordinance.

SECTION 5: Effective Date
This ordinance shall take effect 30 days from the date of its adoption.

PASSED AND ADOPTED by the City Council of the City of Gridley on this [date] day of [month], [year], by the following vote:

City of Gridley Updated November 2024

PURCHASING

POLICIES AND

PROCEDURES
Responsibility
Integrity
Quality
Uniformity
Transparency
City of Gridley Purchasing

CITY OF GRIDLEY PURCHASING POLICES AND PROCEDURES

TABLE OF CONTENTS
Contents
SECTION 1: PURPOSE AND POLICY STATEMENT ................................................................................................. 1 1-1. Purpose: ..................................................................................................................................................................... 1 1-2. Policy Statement: ...................................................................................................................................................... 1 SECTION 2: ETHICS, GIFTS, AND UNAUTHORIZED PURCHASES ...................................................................... 1 2-1. Code of Ethics: .......................................................................................................................................................... 1 2-2. Gifts and Special Considerations:.............................................................................................................................. 2 2-3. Unauthorized Purchases: ........................................................................................................................................... 2 SECTION 3: PURCHASING OFFICER RESPONSIBILITIES .................................................................................... 3 SECTION 4: FINANCE DEPARTMENT RESPONSIBILITIES .................................................................................. 3 SECTION 5: PUBLIC CONTRACT CODE ..................................................................................................................... 4 5-1. Public Works/Engineering Responsibilities: .............................................................................................................. 4 SECTION 6: ADMINISTRATIVE SECRETARY/ CITY CLERK RESPONSIBILITIES ............................................ 5 SECTION 7: OPERATING DEPARTMENTS RESPONSIBILITIES .......................................................................... 5 SECTION 8: PROCUREMENT PROCEDURES ............................................................................................................ 6 8-1. Informal Procurement:............................................................................................................................................... 6 8-1.1. Bidding Limits and Requirements: ............................................................................................................................ 7 8-1.3. Justification: .............................................................................................................................................................. 8 8-2. Formal Procurement Over $200,000 (Not for Public Projects) ................................................................................. 8 8-2.1. Formal Bids: ........................................................................................................................................................... 8 8-2.2. Formal Proposal Process: .......................................................................................................................................... 9 8-2.3. Lowest Responsible Bidder: ................................................................................................................................... 9 8-2.4. Responsiveness: ...................................................................................................................................................... 9 8-2.5 Rejection of Bids/Proposals:.................................................................................................................................... 10 8-2.6. Late Formal Bids/Proposals: ................................................................................................................................. 10 8-2.7. Tie Bidders: .......................................................................................................................................................... 10 8-3. Technical/Maintenance Services: ............................................................................................................................ 10 8-4. Standard Agreement ................................................................................................................................................ 11 8-5. Blanket Purchase Orders: ........................................................................................................................................ 11 8-6. Changes to and Cancellation of Purchase Orders: ................................................................................................... 12 SECTION 9: SPECIAL PROCUREMENT CIRCUMSTANCES ................................................................................ 12 9-1. Finance Department Procurements .......................................................................................................................... 12 9-2. CDBG and Other Applicable Federal Grants: ......................................................................................................... 12 9-3. Sole Source Purchases: ............................................................................................................................................ 13 9-3.1. Sole Source is Appropriate When: .......................................................................................................................... 13 9-3.2. City Administrator Approval: ................................................................................................................................. 14 9-3.3. City Council Approval: ........................................................................................................................................... 14 9-4. Emergency Purchases up to $200,000 (Not for Public Projects): ............................................................................ 14 9-5. Emergencies Over $200,000 (Not for Public Projects and not to exceed $250,000): .............................................. 14 9-6. Emergency Public Projects:..................................................................................................................................... 14 9-7. Cooperative Purchases: ........................................................................................................................................... 14 9-8. Piggyback onto Existing Contract: .......................................................................................................................... 15 9-9. Exemptions from Obtaining a Purchase Order: ....................................................................................................... 15 SECTION 10: PROFESSIONAL SERVICES ................................................................................................................ 17 10-1. Definition: .............................................................................................................................................................. 17 10-2. Operating Department Responsibilities: ..................................................................................................................... 17 10-3. Decentralized: .......................................................................................................................................................... 17 10-4. Solicitation of Proposals: ....................................................................................................................................... 18 10-5. Selection of Consultant: ......................................................................................................................................... 18 10-6. City Attorney Review and Approval: ...................................................................................................................... 18 10-7. Procurement Limits — Professional/Consultant Services: ...................................................................................... 18 10-7.1. Contracts of $50,000 or Less: ................................................................................................................................. 18 10-7.2. Contracts $50,000.01 up to $200,000: ..................................................................................................................... 18 10-7.3. Contracts Over $200,000: ....................................................................................................................................... 18 10-8. Changes to and Cancellation of Purchase Orders: ................................................................................................... 19 SECTION 11: CONTRACT AMENDMENTS FOR TECHNICAL/MAINTENANCE OR PROFESSIONAL SERVICES ........................................................................................................................................................................ 19 11-1. Operating Department Responsibilities: .................................................................................................................. 19 11-2. Amendment Cost Limits:......................................................................................................................................... 20 11-2.1. Contract Total of $50,000 or Less: .......................................................................................................................... 20 11-2.2. Contract Total of $50,000.01 to $200,000:.............................................................................................................. 20 11-2.3. Contract Total Over $200,00: .................................................................................................................................. 20 11-2.4. Prior Approved Contingency: .................................................................................................................................. 20 SECTION 12: SPECIFICATIONS .................................................................................................................................. 20 12-1. Developing Specifications: ...................................................................................................................................... 20 12-2. Standardization: ....................................................................................................................................................... 21 12-3. “Or Equal”: ............................................................................................................................................................. 21 12-4. Vendor Assistance in Writing Specifications: ......................................................................................................... 21 12-5. Review of Specifications: ........................................................................................................................................ 21 SECTION 13: VENDOR RELATIONS .......................................................................................................................... 22 SECTION 14: PROTEST PROCEDURE AND ADMINISTRATIVE APPEAL ........................................................ 22 14-1. Bid Protests (Not for Public Projects): .................................................................................................................... 22 14-1.1. Protest Procedure Prior to Bid Opening: ................................................................................................................. 22 14-1.2. Protest Procedure After Bid Opening: ..................................................................................................................... 22 14-1.3. Protest Review: ....................................................................................................................................................... 23 14-2. Administrative Appeals: .......................................................................................................................................... 23 14-2.1. Informal Bids: .......................................................................................................................................................... 23 14-2.2. Formal: .................................................................................................................................................................... 23 14-3. Public Project Protests and Appeals: ....................................................................................................................... 23 SECTION 15: SURPLUS AND UNCLAIMED PROPERTY........................................................................................ 24 15-1. Surplus/Unclaimed Property: .................................................................................................................................. 24 15-2. Disposal of Personal Property (Less than $500):..................................................................................................... 24 SECTION 16: FEDERALLY DECLARED EMERGENCIES ..................................................................................... 24 CITY OF GRIDLEY’S PURCHASING POLICIES AND PROCEDURES APPENDIX I: DEFINITIONS ........... 25 APPENDIX I: DEFINITIONS
1 CITY OF GRIDLEY

PURCHASING POLICIES AND PROCEDURES
Effective November 2024
SECTION 1: PURPOSE AND POLICY STATEMENT
1-1. Purpose:

The purpose of these policies and procedures is to provide the City of Gridley a means of assuring continuity and uniformity in its purchasing practices; to provide for the fair and equitable treatment of all persons involved in the procurement process; to define the responsibilities of the Purchasing Official, Finance Department, Engineering, Planning, City Clerk/Secretary, City Administrator, and operating departments; and to develop a purchasing manual.

The guiding principle of these purchasing procedures shall be to comply with state law, the City’s Municipal Code, and the adopted budget on all purchases and contracts.

Guidelines for purchasing materials, supplies and services are provided herein. 1-2. Policy Statement:

The policies and procedures contained herein are promulgated under the authority of the Gridley Municipal Code Chapter 3.16.010 “A purchasing system is adopted to establish efficient procedures for the purchase of supplies and equipment, to secure for the City supplies and equipment at the lowest possible cost commensurate with quality needed, and to exercise positive financial control over purchases.” The Finance Department is charged with the responsibility and authority for coordinating and managing the procurement of the City’s materials, supplies, and services.

Procedures outlined herein are to be followed by the Finance Department and operating departments when procuring materials, supplies, and services.

SECTION 2: ETHICS, GIFTS, AND UNAUTHORIZED PURCHASES
2-1. Code of Ethics:

1. To regard public service as a sacred trust, giving primary consideration to the interests of the public agency and citizenry that employ us.

2. To purchase without prejudice, seeking to obtain the maximum value for each dollar expended.

3. To avoid unfair practices, give all qualified vendors equal opportunity.

4. To honor our obligations and require that obligations to our public agency be honored.
2 5. To accord vendor representatives courteous treatment, remember that these representatives are important sources of information and assistance in solving our purchasing needs.

6. To refuse to accept any form of commercial bribery and prevent any appearance of so doing.

7. To be receptive to counsel from our colleagues and to cooperate with them to promote a spirit of teamwork and unity.

8. To conduct ourselves with fairness and dignity, and to demand honesty and truth in the purchasing process.

9. To strive for greater knowledge of purchasing methods and of the materials we purchase.

10. To cooperate with all organizations and individuals involved in activities designed to enhance the development of the purchasing profession, remembering that our actions reflect on the entire purchasing profession.
2-2. Gifts and Special Considerations:

City employees shall not procure or assist in procuring any materials, supplies, services, or equipment for the personal use of any employee, officer, or official of the City.

City employees, officers, or officials by virtue of position are not entitled to any special consideration from vendors and merchants in their personal affairs, nor are they to attempt to procure materials for personal use or for any other person.

City employees shall not solicit or accept gifts, entertainment, or anything more than $50.00 in value from vendors or others. Examples of acceptable gifts might include pencils, scratch pads, and other advertising supplies.
2-3. Unauthorized Purchases:

Except for Cal card card purchases, emergencies, or other authorized exemptions, no purchases shall be made without an authorized purchase order. Purchases without an authorized purchase order or otherwise falling within an exception are void and not considered an obligation of the City. See Section 9 (Special Procurement Circumstances) for further information on exemptions from the purchase order process.

Invoices without an authorized purchase order, except for procurement card purchases and other authorized exemptions per Section 9, may be returned to the vendor unpaid at the discretion of the City.

The person ordering the unauthorized purchase may be held personally responsible for the error per this policy.
3 SECTION 3: PURCHASING OFFICER RESPONSIBILITIES
When there is a reference to the Purchasing Officer, it refers to the City Administrator or their designee. The Purchasing Officer duties are generally delegated to the Finance Director or their designee. This policy also allows other department directors or their designee to have the Purchasing Officer duties.

The Purchasing Officer shall:

1. Be charged with the responsibility and authority for coordinating and managing the procurement of the City’s materials, supplies, and services.

2. Negotiate, purchase, and/or contract for the City the needed quality in equipment, supplies, and services from the lowest responsible bidder.

3. Endeavor to promote full and open competition on purchases when at all possible.

4. Monitor and ensure (or cause to be) that no single professional services consultant or sole-sourced vendor is paid more than $100,000 per fiscal year without prior Council authorization.

5. Revise and maintain these policies and procedures as needed to ensure Municipal Code compliance and protect the interest of the City of Gridley.

6. Ensure adequate funding is secured in the fund accounts against which any purchase is to be charged.

When there is reference to the City Administrator by title, it refers to the City Administrator in their role as the Chief Executive Officer and their authority to approve and sign contracts and purchase orders.

SECTION 4: FINANCE DEPARTMENT RESPONSIBILITIES
The Finance Department shall ensure that the purchasing functions operate efficiently and assist operating departments.

Finance shall:

1. Maintain open communication with operating departments and become acquainted with the needs of the various City departments and divisions.

2. Support department/division requisitions.

3. Assist purchasing, as needed, materials, supplies, and services required by any department/division.

4. Follow-up, expedite, and resolve problems with orders as requested.

5. Identify, evaluate, and utilize purchasing arrangements which best meet the needs of the City (e.g., cooperative purchases, blanket purchase orders, contractual agreements, etc.)

6. Assist operating departments with research and recommendations for developing specifications, and review specifications for completeness of information and open and competitive language.

7. Issue purchase orders to the requesting operating departments after completion of all required procurement processes.

8. Recommend revisions to purchasing procedures when necessary and keep informed of current developments in the field of purchasing.
4 9. Act as the City’s agent in the disposal and transfer of surplus materials. The Finance Department may designate the operating departments to assist in or conduct this process.

10. Prescribe and maintain all forms and records necessary for efficient operation. The most current and acceptable mandatory and voluntary forms and templates shall be readily accessible to the operating departments. The Standard Agreement and Professional Services Agreement templates shall be as approved by the City Attorney.

SECTION 5: PUBLIC CONTRACT CODE
The City’s Public Works and Electric Department is the focal point for all “public projects.” As per City Municipal Code 3.16.160 Formal Contract Procedure.

On 07/03/1989, the City elected to be subject to the California Uniform Construction Cost Accounting Commission (“CUCCA”). Per California Public Contract Code 22032 and Assembly Bill 2249, any City Project that is estimated to be below $200,000 is subject to the Informal Bidding Procedures set forth by CUCCA. Additionally, the City shall use the amounts stated in the most recent updates to the CUPCCAA. All trade categories are subject to Informal Bidding Procedures.

Additionally, pursuant to SB 854, no contractor or subcontractor may be listed on a bid for a public works project unless registered with the Department of Industrial Relations (DIR) and no contractor or subcontractor may be awarded a contract for a public works project unless registered with the DIR per California Labor Code section 1725.5. http://www.dir.ca.gov/Public-Works/PublicWorks.html
5-1. Public Works/Engineering Responsibilities:

1. Maintain a bid numbering system to be used Citywide for all informal and formal Public Contract Code bids.

2. Maintain the City’s required public record for all Public Contract Code bids.

3. Mail a written notice in November, of each year, to construction trade journals/exchanges in accordance with the Cost Accounting Policies and Procedures Manual of the California Uniform Public Construction Cost Accounting Commission.

4. Maintain a Public Works construction projects formal and informal bidding matrix.

5. Assign a project lead for all Public Works formal bid projects being conducted for the City.

6. Have a representative attend their bid opening to be held publicly. 5 SECTION 6: ADMINISTRATIVE SECRETARY/ CITY CLERK RESPONSIBILITIES Administrative Secretary/City Clerk or designee shall:

1. Receive and hold Finance formal and Public Contract Code bids prior to the bid opening.

2. Date and time stamp bids at the time of receipt. Bids will also be logged into a tracking system devised by the Administrative Secretary/City Clerk.

3. Open and read bids publicly at the location, date, and time specified.

4. Maintain and publicly post the official bid clock; the clock shall be clearly visible and marked.

SECTION 7: OPERATING DEPARTMENTS RESPONSIBILITIES
Any department that utilizes the goods and/or services purchased under a requisition shall be referred to as an operating department. Operating departments shall:

1. Maintain open and consistent communication with the Finance Department.

2. Monitor any problems with vendor relations, shipping, (e.g., damaged goods, late delivery, wrong items delivered, incorrect quantity delivered, etc.) and any situations and/or concerns as necessary, in order to follow-up and resolve the problem.

3. Review and update annually, or as needed, an authorized signature list designating those individuals who are delegated the authority to sign purchase orders, Request for Payment forms, and invoices eligible for payment and their specified dollar limits. The Department Head shall provide this authorized signature list to the Purchasing Officer or designee on the form.

4. Anticipate requirements sufficiently in advance, allowing adequate time to obtain materials, supplies, and services in accordance with the best purchasing practices.

5. Provide detailed and accurate specifications to ensure materials, supplies, and services obtained are consistent with expectations and requirements.

6. Coordinate and establish vendor relations, locate vendors, and evaluate vendor performance, bids, and responses.

7. Strive to obtain the highest quality goods consistent with operational needs, from the most responsible bidder, offering a price that is the most advantageous to the City.

8. Prepare purchase orders/requisitions carefully and properly in accordance with instructions; submit purchase requisitions to the Finance Department through the City’s then existing finance management software (Incode 10 at time of policy approval).

9. Minimize emergency and sole source purchases to the greatest extent practicable and, when such purchases are necessary, fully comply with the Municipal Code and this policy, including obtaining City Council or City Administrator approval whenever necessary.

10. Make written recommendations, as required, based upon specification criteria, as well as perform reference checks to assist in determining lowest responsible bidder/proposer. Present a written memorandum to Finance when less than three 6 quotes have been received or when not awarded to the lowest responsible vendor.

11. Ensure adequate funding is available in the fund accounts against which any purchase is to be charged.

12. Authorized individuals may purchase materials, supplies, and services by small purchase order or procurement card of a value up to $5,000. Departments must exercise reasonable prudence in seeking price quotes when purchasing such items.

All such purchases shall be made with funds in an unencumbered appropriation.

SECTION 8: PROCUREMENT PROCEDURES
The primary purchasing objective is to obtain suitable goods, services, and construction at economic prices, as these acquisitions are direct costs to the taxpayer. The Municipal Code and purchasing policy require competition for all purchases over $5,000 and sealed competitive bids for over $200,000.

1. Bidding limits are generally “per order,” and orders are not to be split to circumvent the specified limits.

2. The estimated full-value cost of the item plus tax before any discount is the amount to be considered in determining bidding requirements. Even though the net purchase price could be lower than the bid thresholds, the asset value would be the full price of the item.

All purchases of supplies, equipment, and technical/maintenance services which qualify as part of a public project as defined by the Uniform Construction Cost Accounting Act shall be made in accordance with the Public Contract Code and Municipal Code Chapter 3.16.160 Formal Contract Procedure. (see Section 5).
8-1. Informal Procurement:

Each public agency that elects to become subject to the uniform construction accounting procedures set forth in Article 2 (commencing with Public Contract Code Section 22010) shall enact an informal bidding ordinance to govern the selection of contractors to perform public projects pursuant to subdivision (b) of Section 22032. The ordinance shall include all of the following:
(a) Notice to contractors shall be provided in accordance with either paragraph (1) or (2), or both.
(1) The public agency shall maintain a list of qualified contractors, identified according to categories of work. Minimum criteria for development and maintenance of the contractors list shall be determined by the commission. All contractors on the list for the category of work being bid shall be mailed, faxed, or emailed a notice inviting informal bids unless the product or service is proprietary. All mailing of notices to contractors pursuant to this subdivision shall be completed not less than 10 calendar days before bids are due. (2) The public agency may elect to mail, fax, or email a notice inviting informal bids to all construction trade journals specified in Section 22036. 7 (b) The notice inviting informal bids shall describe the project in general terms and how to obtain more detailed information about the project, and state the time and place for the submission of bids.
(c) The governing body of the public agency may delegate the authority to award informal contracts to the public works director, general manager, purchasing agent, or other appropriate person.
(d) If all bids received are in excess of two hundred thousand dollars ($200,000), the governing body of the public agency may, by adoption of a resolution by a four-fifths vote, award the contract, at two hundred twelve thousand five hundred dollars ($212,500) or less, to the lowest responsible bidder, if it determines the cost estimate of the public agency was reasonable.

Cal. Pub. Contract Code § 22034
The bidding limits below refer to supplies and technical/maintenance services and do not include professional/consultant services (see Section 10) or “public projects” (see Section 5). The bidding limits are below.
8-1.1. Bidding Limits and Requirements:

Bidding Limit Approving Authority
Procurement
Requirement Document Retention
$0 to $5,000 Authorized staff No competition
required
No separate retention –
the invoice should be
attached to small PO or
procurement card
report for Accounts
Payable
$5,000.01 to $25,000 Department Head
Informal bid (3 quotes
if possible) OR Sole
Source Justification
approved by
Department Head
Retained by operating
department with
purchase order
$25,000.01 to $50,000 Finance Director
Department Head
Informal bid (3 quotes
if possible) OR Sole
Source Justification
approved by
Department Head
Retained by Finance
with record of purchase
order
$50,000.01 to $200,000
City Administrator
Finance Director
Department Head
Informal bid (3 quotes
if possible) OR Sole
Source Justification
approved by City
Administrator
Retained by Finance with
record of purchase order
Note: Contracts that exceed $200,000 require City Council Approval, this includes change orders. 8 8-1.2 Informal Procurement Rules

1. Documents to be retained include written quotations and/or sole source justification, a copy of the agreement, and other associated required documents as applicable. Retention shall be in accordance with the City’s retention guidelines. Original contracts shall be given to the City Clerk’s office for retention.

2. Small purchase order or procurement card systems may be used for procurements up to $5,000; above $5,000 must use large purchase order system.

3. Staff procuring items via small purchase order or procurement card must be approved by the Department Head up to an appropriate procurement limit via the authorized signatures list maintained by the Finance Department.

4. Purchases that in total exceed a bidding limit are not to be split in order to obtain equipment, materials, or services under a lesser level of approval and procurement requirements.

5. A Request for Quotation form is recommended, though not required, for any informal bid from $25,000 to $50,000, and should be accompanied by specifications, insurance requirements, and contract agreement as applicable. 8-1.3. Justification:

Whenever the bidding/proposal process is dispensed with or the lowest bidder is not used, recommendation and justification for doing so shall be in writing and forwarded to the Finance Department at the time the requisition is prepared. It shall be signed by the requesting Department Head.
8-2. Formal Procurement Over $200,000 (Not for Public Projects)

1. Formal procurement process is required.

2. Competitive bidding is required unless otherwise authorized in these policies and procedures.

3. Written sole source justification can be used in certain circumstances with City Council approval, as per Section 9-3.

City Council approval is required.Formal bids for public projects, including associated dollar thresholds, shall be done in accordance with Public Contract Code Section 22030 et seq., as per Section 5 of this policy and the latest updated limits dictated by the Uniform Construction Cost Accounting Commission.
8-2.1. Formal Bids:

Formal quotations are written bids or proposals requiring a formal closing time/date. Public notices are posted on the City’s website and/or advertised in the local newspaper, at least ten days prior to the opening of the bids. When advertised in the newspaper, invitations for bid will be published at least two times. Formal bids are opened in public. 9 8-2.2. Formal Proposal Process:

The formal proposal process may be used in procurements involving complicated and performance-type specifications which may require involved negotiations or communications with vendors to clarify proposals submitted. The proposal process should be utilized in negotiated procurements or those procurements where the answer to a certain approach or a specific item necessary to satisfy the City’s needs is unknown. Public notice advertisements requesting invitations for proposal will be posted on the City’s website and/or published in the local newspaper at least two times; the first insertion must be at least ten days prior to the opening date. Formal proposals are made public upon execution of a signed contract.
8-2.3. Lowest Responsible Bidder:

Bids will be awarded to the responsive bidder who submits the lowest responsible bid that is most advantageous to the City and is consistent with the requirements of this procurement policy. The term “lowest responsible bidder” as used in the City’s bidding documents shall mean the lowest bidder whose bidoffer best corresponds in quality, fitness, and capacity to the requirements of the proposed work or usage.

Sellers, vendors, suppliers, and contractors of supplies and equipment who maintain places of business located within the limits of the City shall be given preference if quality, price, and service are equal. In awarding the purchase, staff may consider the benefit derived by the City from sales tax revenues received by it in tabulating the lowest responsive bidder.

In determining the “lowest responsible bidder,” the following elements shall be given consideration (in addition to price):

1. The ability of the product offered to provide the quality, fitness, and capacity for the required usage.

2. The ability, capacity, and skill of the bidder to perform the contract or provide the service required.

3. The character, integrity, reputation, judgment, experience, and efficiency of the bidder, particularly with reference to historical past experiences and/or past purchases with or by the City.

4. Whether the bidder can perform the contract and/or deliver the materials, supplies, and services within the time required.

5. The quality of performance and/or quality of products provided in previous contracts or services.

6. Other information secured and having a bearing on the decision to award the contract.

7. Continuity of service.
8-2.4. Responsiveness:
10 A responsive bid is one which is in substantial conformance with the requirements of the invitation to bid, including specifications and the City’s contractual terms and conditions.

Bidders who substitute terms and conditions or who qualify their bids in such a manner as to nullify or limit their liability may be considered a non-responsive bidder and rejected on those grounds. Conformance with the requirements of the invitation to bid may also include, but is not limited to, completion of forms, inclusion of references and attachments, and completion of required responses.
8-2.5 Rejection of Bids/Proposals:

The authority to reject is based on the authority to award. The City of Gridley reserves the right: (1) to reject any or all bids or any part thereof and (2) to waive any informalities and/or negotiate minor deviations to the bid with the successful firm. The City of Gridley’s decision shall be final.
8-2.6. Late Formal Bids/Proposals:

Formal bids or proposals submitted after the designated closing time shall be returned unopened and not accepted.
8-2.7. Tie Bidders:

If two or more bids are received which are in all respects equal, the City Council may award to the local vendor. If both are local vendors or none are local vendors, City Council may draw lots, re-bid, or the award may be made to the one deemed in the best interest of the City.
8-3. Technical/Maintenance Services:

Services of a general nature (as opposed to professional/consulting services) shall be contracted by following a Request for Proposal or Bid process. The method of selection shall be determined by the Purchasing Officer and may include both the qualifications of the service provider and cost of the service. If it is determined by the operating department in consultation with the Purchasing Officer that all vendors providing a service classification can equally provide the service satisfactorily, a bid process would be appropriate; however, if factors other than price need to be considered in awarding the contract, a proposal process may be used.

Proposals evaluated by the City for technical/maintenance services should be based on a combination of qualifications and cost. Examples of areas other than price that may be important in awarding the contract include experience level, competence, resources/equipment, staffing levels, service availability/time factors, and other qualifications identified by the operating department responsible for recommending the service contract. Following committee interviews and selection, staff may further refine the scope of work and additional cost negotiations may take place.

The bidding limits and requirements are the same for technical/maintenance services 11 whether the vendor was selected by bid or proposal.

An executed Standard Agreement and documents provided by the vendor meeting the City’s insurance requirements are required for any services that will be provided to the City.
8-4. Standard Agreement
All general services (not professional services) must use a Standard Agreement approved by the City Attorney. Work should not commence until all documentation has been acquired and the agreement and purchase order have been executed by the appropriate parties of the City, as determined by the dollar limits and responsibilities outlined above.

The City shall also follow all federal contract requirements for projects where federal funds will be used.

Standard Agreements must include the following:

1. Fully executed agreement by all parties

2. Specification(s), quotes, and/or sole source justification

3. Insurance documentation meeting the City’s insurance requirements The City shall, whenever possible, shall take all necessary affirmative steps to assure that minority businesses, women’s business enterprise, and labor surplus area firms are used when possible as states in Section 200.321 of Federal Regulations. The City shall, whenever possible, provide a preference for the purchase, acquisition, or use of goods, products, or materials produced in the United States as stated in Section 200.322 The City shall, whenever possible, use the City agreement form as approved by the City Attorney. Should another agreement be considered for technical/maintenance services, the agreement will require City Attorney review and approval as to form prior to execution by the City.

The City Attorney shall review and approve as to form all Standard Agreements prior to City Council approval for all purchases over $200,000.
8-5. Blanket Purchase Orders:

Blanket purchase orders provide equipment or supplies on an as-needed and/or over-thecounter basis in unspecified amounts from a selected vendor. Blanket purchase orders provide a mechanism whereby items which are uneconomical to stock may be purchased quickly, allowing operations timely access to necessary materials. Blanket purchase orders are valid for the current fiscal year. Blanket purchase orders shall not be used to purchase capital assets.

Once a blanket purchase order is issued to a vendor, any authorized City employee may contact the vendor directly to place orders per the terms and conditions specified in the 12 blanket purchase order.

The Finance Department will review blanket purchase order requests based upon the following criteria:

1. Geographic location

2. Responsiveness and capabilities

3. Average dollar value and type(s) of items to be purchased

4. Frequency of need

5. Vendor pricing methodology
Blanket purchase orders do not take the place of competitive quote, bid, or proposal processes.
8-6. Changes to and Cancellation of Purchase Orders:

The operating department will notify Finance when initiating changes which alter the purchase order. Purchase orders that need to be canceled or closed must be forwarded to Accounts Payable. The last payment against a purchase order that does not increase the purchase order total by 10% can be processed without obtaining a purchase order change order.

The City Administrator will approve any change orders that have the purchase order total amount exceed $50,000, up to $200,000. Change orders cannot be requested that exceed Council-approved appropriations or Council contract award amounts without additional Council authorization.

SECTION 9: SPECIAL PROCUREMENT CIRCUMSTANCES
9-1. Finance Department Procurements
The Finance Department is charged with the duty to contract for purchase of the following equipment, materials, and services:

1. New or replacement vehicles or equipment

2. Items purchased from state contracts or Cooperative Purchase Agreements

3. Computer hardware and software (through the Information Technology Department)

4. Other items as may be determined in the future

5. When it is in the best interest of the City to negotiate an extension of an existing contract for supplies or technical services, based on satisfactory performance.

Such a negotiated price must be fair and reasonable. This shall also apply to products or services purchased through prior recent bidding. 9-2. CDBG and Other Applicable Federal Grants:

In compliance with the City’s Community Development Block Grant, HOME funds, and other applicable federal funds administered by the United States Department of Housing 13 and Urban Development (HUD), procurement procedures shall comply with federal regulations (24 CFR 85.36). The City will follow the Office of Management and Budget Guidance 2 CFR 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.
9-3. Sole Source Purchases:

When competitive quotations for goods and services are not possible, such purchases shall be made through negotiated procurement. Sole source purchases may require City Administrator or City Council approval, based upon procurement limits and Municipal Code requirements.

A sole source justification form must be signed by the requestor’s Department Head and City Administrator (if applicable), then forwarded to the Finance Department and filed to justify the sole source purchase. Sole-source specifications should be avoided whenever possible as they minimize or eliminate competition.

When the use of said sole-source vendor is expected to be repeated or ongoing, the operating department may indicate that it is a “recurring” sole source on the sole source justification form. The sole source justification shall then be valid for three years from date of approval by the Department Head.
9-3.1. Sole Source is Appropriate When:

1. The requested product is an integral repair part or accessory compatible with existing equipment and is only available from one vendor.

2. The requested product has unique design/performance specifications or quality requirements which are essential to department operations and are not available in comparable products.

3. Only known manufacturer of this product.

4. The requested product is one with which department staff have specialized training and/or extensive expertise. Retraining would incur substantial cost in time and/or money.

5. Only vendor authorized to sell/service this product in our region.

6. Upgrade to existing software. Available only from the producer of this software who sells on a direct basis only.

7. Emergency purchase.

8. Public project procurements under the requirements established by Public Contract Code Section 22032(a).

9. Special situations as they arise.
14 9-3.2. City Administrator Approval:

Sole source requests between $50,000.01 and $200,000 require the approval of the City Administrator.
9-3.3. City Council Approval:

Sole source requests over $200,000 require the approval of the City Council. 9-4. Emergency Purchases up to $200,000 (Not for Public Projects):

Emergency purchases may be made without the benefit of competitive bidding when time is of the essence. Emergency purchases should be made only for the following reasons: (1) to preserve life, health, or property; (2) upon a natural disaster; (3) to correct or forestall a shutdown to maintain essential public services; or (4) other unforeseeable events (as authorized by the City Administrator). Emergency purchases are not valid for contrived urgencies resulting from lack of planning and organization. Since emergency orders do not normally provide the City an opportunity to obtain competitive quotes, nor properly encumber funds, such orders should be kept to an absolute minimum. Emergency purchases shall be approved by the Department Head or designee. 9-5. Emergencies Over $200,000 (Not for Public Projects and not to exceed $250,000):

Emergency purchases over $200,000, not to exceed $250,000, require the approval/signature of the City Administrator. The City Administrator shall provide a report after any emergency purchase over $200,000 at the next City Council meeting following the emergency purchase.
9-6. Emergency Public Projects:

Public projects shall be completed according to Public Contract Code 22050 9-7. Cooperative Purchases:

The City may participate in purchases and contracts conducted by other political jurisdictions, provided that the cooperative agreement is established following a competitive bid process. In a cooperative purchase, one agency represents several agencies by soliciting bids including the needs of the other agencies in the bid specifications. This higher product volume may result in lower unit cost for all agencies, and also reduces the time and cost of the City administering its own bid process.

Needed documentation includes:

1. Copy of the other jurisdiction’s bid document(s)

2. Any Board or Council action awarding the contract

3. The contract documents
15 The City Administrator may authorize the award of cooperative purchase agreements for amounts not more than $200,000; City Council approval is required for the award of any cooperative purchase exceeding $200,000.
9-8. Piggyback onto Existing Contract:
“Piggybacking” is the use of an existing contract for goods between another government agency and a vendor for the purchase of those same goods. When piggybacking onto a contract, the City must use the terms of the contract and price of the item must be as specified in the contract or awarding document. The contract for consideration must have been awarded through a competitive bidding process prepared and awarded by another local, state, or federal government agency.

Needed documentation includes:

1. Copy of the other jurisdiction’s bid document(s)

2. Any Board or Council action awarding the contract

3. The contract documents
The City Administrator may authorize the award of piggyback purchases for amounts not more than $200,000; City Council approval is required for the award of any piggyback purchase exceeding $200,000.
9-9. Exemptions from Obtaining a Purchase Order:

The Finance Department shall maintain an approved direct pay list for which no purchase order is required due to unique purchasing circumstances, such as invoices from government agencies, utility providers, and subscription services.

The following is a non-inclusive list of the direct pay categories and/or vendors at the time of policy adoption:
 Actuarial studies
 Advertising
 Assessment district administration costs
 Attorney services
 Butte County Air Quality Management District
 Bond issuance costs (bond counsel, rating agency fees, and trustee fees)  Cafeteria plan administration
 CDBG and Home Rehabilitation Loans
 Claim settlements (for liability claims)
 Conference or seminar registration
 Copy machine maintenance and leasing under contract
 Debt service payments
 Department of Health Services
 Department of Water Resources
16  Deposit refunds
 Document destruction
 Downtown Business Improvement District remittance of cash receipts  Employment Development Department
 Family Intervention Team program expenditures
 Feather River Air Quality Management District
 Fingerprinting (Department of Justice)
 Fingerprinting (Sutter County – Live Scan)
 Fire Department stipend checks
 Fuel for storage tanks
 General Liability insurance premiums
 Drainage
 Housing consultant
 Land/property
 Lobbying activities
 Meals (per diem or travel reimbursement)
 Membership dues
 Office equipment O&M
 Office supplies (consumable only)
 Parking Citation Hearing Officer
 Payroll deduction remittances
 Petty cash reimbursements
 Postage & freight
 Pre-employment physicals, medical blood, DATCO (substance abuse testing)  Refunds
 Retirement administration: Phase II Systems for PARS trust administration  State Board of Equalization (diesel fuel tax, sales and use tax)  State Division of Administrative Services (seismic fees)  State Water Resources Control Board
 Subdivision Agreement reimbursements
 Subscriptions
 Supplies or refreshments reimbursement
 Teambuilding
 Telephone
 Temporary help (personnel agency)
 Training programs
 Travel & meetings
 Trustee fees
 Tuition reimbursements
 Uniform rental and cleaning (under contract)
 Utilities
17  Vehicle allowance
 Water delivery service
 Gridley Economic Development Corporation
An authorized signature and appropriate budget number(s) should be provided by the purchaser to Accounts Payable for invoices up to $5,000. Invoices above $5,000 should be accompanied by a check request form, approved by the Department Head.

SECTION 10: PROFESSIONAL SERVICES
10-1. Definition:

Those services by independent consultants such as legal, engineering, programming, planning, environmental, economic, financial, testing, specialized temporary employee services, medical, dental, accounting, surveying, landscape architecture, advertising, design, etc., are considered to be “professional services”. This may also include services requiring peculiar or specialized abilities which by state law do not require competitive bidding.
10-2. Operating Department Responsibilities:

1. Prepare specifications or scope of work.

2. Solicit, review, and select qualified consultant/firm.

3. Provide written documentation justifying selection of the successful consultant/firm.

4. Prepare a City Professional Services Agreement and obtain consultant’s signature.

5. Compile all exhibits/attachments described or referenced in the contract.

6. Secure and review required insurance documents for conformance to City contract requirements.

7. Submit the contract to the City Attorney for review and approval, if applicable.

8. If between $50,000 and $200,000, obtain City Administrator approval.

9. If over $200,000, obtain Council approval.

10. Submit requisition to Finance to issue a purchase order.

11. Submit original signed contract, complete with exhibits, attachments, and insurance, to the City Clerk.

12. Provide the consulting firm with a signed copy of the contract. 10-3. Decentralized:

With the exception of engineering/planning services and legal representation/services which are at the sole pleasure and discretion of the City Council, due to the specialized and technical nature of professional services, contracting for professional services is decentralized and shall be the responsibility of each applicable Department Head. 18 10-4. Solicitation of Proposals:

Solicitation of professional service proposals is the responsibility of the operating departments. The Finance Department may be contacted to assist and support the formal request for proposal process.
10-5. Selection of Consultant:

Contracts negotiated by the City for professional services will be based on demonstrated competence, professional qualifications for the services required, availability, fair and reasonable cost, and other relevant factors as determined by the operating department.

Competitive bidding is encouraged whenever possible; however, it is not mandatory. 10-6. City Attorney Review and Approval:

The City shall, whenever possible, use the City’s Professional Services Agreement form, which has been approved as to form by the City Attorney. Should another agreement be considered for professional services, review and approval as to form by the City Attorney is required prior to execution by the City.

The City Attorney shall review and approve as to form all Professional Service Agreements prior to City Council approval for contracts over $200,000. 10-7. Procurement Limits — Professional/Consultant Services:

Specified procurement limits are tabulated per consultant firm per fiscal year and are not to be split to circumvent the determined limits. No professional services consultant shall be paid more than $200,000 per fiscal year for the City as a whole without prior Council authorization.
10-7.1. Contracts of $50,000 or Less:

Contacting three (3) firms, although encouraged, is not required for contracts $50,000 or less. Department Heads are authorized to sign Professional Service Agreements totaling $50,000 or less.
10-7.2. Contracts $50,000.01 up to $200,000:

Operating departments should, whenever possible, contact three (3) consultants/firms and select the most qualified firm. The City Administrator is authorized to sign Professional Service Agreements totaling $200,000 or less.
10-7.3. Contracts Over $200,000:

Operating departments shall solicit written proposals and negotiate with a minimum of three (3) consultants/firms, whenever possible. Professional Service Agreements over $200,000 requires City Council approval. If the contract is a multiple year agreement, 19 information regarding multiple years must be presented to Council in the staff report at the time of approval.
10-8. Changes to and Cancellation of Purchase Orders:

SECTION 11: CONTRACT AMENDMENTS FOR TECHNICAL/MAINTENANCE

OR PROFESSIONAL SERVICES
Ongoing City contracts with technical/maintenance vendors or professional services consultants may require amendments for a number of reasons, including change in scope of work, time extension to complete the project or renew for an additional period of time, and unforeseen costs.

Should a firm’s agreement be considered, review and approval as to form by the City Attorney is required prior to execution by the City.
11-1. Operating Department Responsibilities:

1. Prepare a City amendment and obtain appropriate signatures from both parties.

2. Compile all exhibits/attachments referenced in the amendment. Update the insurance documents if necessary.

3. Obtain City Administrator and/or City Attorney approval, if applicable.

4. When the contract plus amendment total over $200,000, obtain City Council approval.

5. Submit request to Finance for a purchase order change order if the amendment alters the dollar amount.

6. Submit original signed amendment, complete with exhibits and attachments, to the City Clerk.

7. Provide the consultant (professional services) or vendor (technical/maintenance services) a signed copy of the amendment.
20 11-2. Amendment Cost Limits:

Contract amendments can only be approved within their cost limits. Cost limits are calculated as the existing contract total plus any cost changes in the amendment. 11-2.1. Contract Total of $50,000 or Less:

Amendments can be approved by the Department Head if the contract total, including all amendments, does not exceed $50,000.
11-2.2. Contract Total of $50,000.01 to $200,000:

Amendments can be approved by the City Administrator if the contract total, including all amendments, does not exceed $200,000.
11-2.3. Contract Total Over $200,00:

Amendments must be approved by City Council and executed by the City Administrator if the amended contract will exceed the amount previously approved by City Council or if an amendment will cause the contract to exceed $200,000.
11-2.4. Prior Approved Contingency:

City Council may award a contract amount plus a contingency for a project or service that will or potentially will exceed $200,000. In such a case, the contract would originally reflect the primary contract amount, but may be amended later up to the contingency authorized as part of the Council item without further Council action.

SECTION 12: SPECIFICATIONS
Accurate specifications are essential for effective bidding. It is the responsibility of each department to provide detailed, accurate specifications when requisitioning supplies and services.
12-1. Developing Specifications:

Well-developed specifications are necessary to ensure quality that will fulfill the operating department’s needs while also avoiding unnecessary costs for the taxpayer. A good specification should be:

1. Simple and straightforward, yet specific enough that the bidder cannot evade any of the provisions or underbid products that do not meet the department/division’s needs.

2. Clear and easily identified, including any necessary measurements, material standards, or similar product types on the market.

3. Flexible and reasonably tolerant of discrepancies and different products. 21 4. As fair to the seller as reasonably possible without compromising the City’s interests, and capable of being met by multiple bidders in order to promote competition.

5. Capable of being checked in order to determine if the quality is sufficient and the bid is valid.
12-2. Standardization:

Standardization of specifications for items common to several divisions enables collaborating departments to buy quantity and generally receive lower pricing due to larger orders. The Finance Department will support operating departments in the establishment of standard specifications for articles in common use.
12-3. “Or Equal”:

When brand names are specified, the words “or equal” must be added unless compelling reasons make only a single brand acceptable. Use of a brand name for “equal to” specifications should be for the purpose of describing the standard of quality, performance, and characteristics the City desires and not be intended to limit or restrict competition. Use of “equal to” specifications should, whenever possible, identify a minimum of two brand names as approved equals.

Using specifications provided by a specific manufacturer should be avoided and, if used, the name of the manufacturer, model number, etc., should be indicated. It should also be stated, that use of the manufacturer’s specifications are for the sole purpose of establishing an “equal to” criteria. When specifications designate “or equal,” the City reserves the right to determine and approve any other as being equal or acceptable. 12-4. Vendor Assistance in Writing Specifications:

There may be occasions when vendor assistance may be required in developing specifications. Such specifications should be written in general terms. The vendor should be clearly informed that the information provided might be used in developing specifications for a competitive bidding process. The Purchasing Officer or their designee shall approve such specifications.
12-5. Review of Specifications:

It is the operating department’s responsibility to ensure that specifications are complete and accurate. The department will review the completeness of information, terms and conditions, insurance/compliance, and open and competitive language. To assure bid/proposal specifications and terms meet the City needs, the operating department may request review or assistance by the Finance Department, the City Attorney, or other pertinent City staff in the development of specifications. 22 SECTION 13: VENDOR RELATIONS
It is to the City’s advantage to maintain and promote good relations with suppliers. The City’s vendor relations reflect the public image of the City organization. Finance and the operating departments are responsible for promoting fairness, integrity, courtesy, and goodwill in their vendor relations.

Operating departments may make direct contact with vendors for such purposes as obtaining price quotes (less than $200,000), developing service contracts, initiating informal bid or proposal processes, obtaining technical information, obtaining cost estimates for budgeting or purchasing purposes, preparing purchase requisitions, and placing orders for authorized purchases.

The Finance Department may be the main contact in formal bid situations. Finance may also serve as an intermediary between operating departments and vendors when requested by operating departments or in conflict resolution matters.

SECTION 14: PROTEST PROCEDURE AND ADMINISTRATIVE APPEAL 14-1. Bid Protests (Not for Public Projects):

In the event of a bid protest, the alleged aggrieved protesting bidder must file in writing to the Finance Director the exact reason for the protest. In no event shall a protest be considered if all bids are rejected or after award of the contract. Failure to comply in the manner prescribed shall constitute a failure to exhaust administrative remedies and shall automatically relieve the City of Gridley from accepting that protest.

Any others who wish to protest the outcome of a bid or procurement must utilize the public comment process during the regularly scheduled City Council meetings. 14-1.1. Protest Procedure Prior to Bid Opening:

Any bidder wishing to file a protest prior to bid opening concerning the specifications or bid procedure must do so in writing. This written protest must be received by City Clerk no later than four working days prior to bid opening. If a protest that is received cannot be resolved by the designated time of the bid opening, the City Administrator may delay the bid opening until the protest is addressed to the City’s satisfaction. 14-1.2. Protest Procedure After Bid Opening:

Any bidder wishing to protest based on information that only became evident after the bid opening must file the protest in writing. This written protest must be received by the City Clerk no later than five working days after the City of Gridley notifies all bidders of the apparent low bid or the proposal selected by the committee for procurements under the formal bid limit, or within five working days from when bids or proposals over the formal bid limit are opened in public.
23 14-1.3. Protest Review:

The City Administrator shall review the written protest and, within five working days after receipt of the written protest, issue a decision in writing. The decision shall state the reasons for the action taken as well as inform the protesting bidder of the right to administrative appeal. A copy of the decision will be forwarded to the Finance Department.

A decision rendered by the City Administrator as outlined in this section shall be final and conclusive. If the alleged aggrieved protesting bidder has complied with the protest procedures, they shall have the right to commence an administrative appeal. 14-2. Administrative Appeals:

The Finance Director’s decision regarding a bid protest may be appealed to the appropriate approving authority, based upon the procurement limits. The protestor will be notified regarding the appropriate administrative appeal procedure in the written decision from the Finance Director.
14-2.1. Informal Bids:

The City Administrator is the approving authority for all administrative appeals for all purchases up to $200,000. Appeals must be written and submitted to the City Administrator’s Office within five working days after the aggrieved bidder is notified of the Finance Director’s decision. A written decision will be issued within ten working days after receipt of the written appeal. The decision by the City Administrator is final. 14-2.2. Formal:

The City Council is the approving authority for formal appeals for the City of Gridley for all purchases over $200,000. Appeals must be written and submitted to the City Administrator’s Office within five working days after the aggrieved bidder is notified of the Finance Director’s decision. The City Council may consider the appeal concurrently with its decision on the award. The decision by the City Council is final. 14-3. Public Project Protests and Appeals:

Protests and appeals regarding public projects shall be per the procedures established in the Public Contract Code.
24 SECTION 15: SURPLUS AND UNCLAIMED PROPERTY
15-1. Surplus/Unclaimed Property:

The Purchasing Officer shall have the authority to sell, exchange, or trade in all supplies, materials, and equipment which are no longer used, have become obsolete, worn out, or scrapped, or which have become unsuitable for public use.

The Purchasing Officer shall also have the authority to sell unclaimed property. All unclaimed property shall be sold or otherwise disposed of in accordance with Civil Code § 2080 et seq.

All sales shall be in accordance with the provisions outlined in Section 3.16.190 of the City’s Municipal Code.
15-2. Disposal of Personal Property (Less than $500):

Pursuant to Welfare and Institutions Code § 217, in lieu of the provisions contained in Civil Code § 2080, an alternative procedure is established with respect to the disposal of unclaimed personal property not worth more than $500. The Purchasing Officer is authorized with respect to said property, which has been unclaimed for at least 90 days, to transfer and deliver any such items to the Probation Officer of the County, to the Welfare Department of the County, or to any charitable or nonprofit organization which is authorized under its articles of incorporation to participate in a program or activity designed to prevent juvenile delinquency and which is exempt from income taxation under federal or state law, for use in any program or activity designed to prevent juvenile delinquency.

SECTION 16: FEDERALLY DECLARED EMERGENCIES
In the event of an emergency declared by the President of the United States, the City of Gridley must comply with federal procurement standards as a condition of receiving public assistance funding from the Federal Emergency Management Agency (FEMA) for contract costs for eligible work. FEMA funding is governed by Title 2 of the Code of Federal Regulations (CFR) Part 200: Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.

CITY OF GRIDLEY’S PURCHASING POLICIES AND PROCEDURES
APPENDIX I: DEFINITIONS
Amendment – A modification of terms and/or pricing for goods, professional services, or technical/maintenance services contracts or task orders.

Bid – A comparative price offer made by an intended seller in reply to an Invitation for Bid or Request for Quotation.

Bid Document – A document soliciting pricing for materials, supplies, and services purchases.

The bid document includes all pertinent information related to the purchase (specifications), plus instructions to the vendor on how to prepare the document, terms and conditions, and any insurance requirements necessary.

CAL-Card – The City’s procurement card issued under California Department of Goods and Services, utilized as a payment mechanism for purchases by authorized City staff.

Consultant – A provider of professional services, such as the examples provided in Section 10-1.

Should be contracted via a Professional Services Agreement. See Section 10 for procurement guidelines.

Contract – Any agreement or written document which produces a contractual agreement between the City and another party for the procurement or disposition of materials, services, professional services, or construction projects.

Department Head – The director of a department or their designee.

Equipment – Furnishings, machinery, vehicles, rolling stock, and other personal property used in the City’s business.

Force Account – Construction work performed by City labor.

Goods – Any and all supplies, materials, and/or equipment which are moveable at the time of sale, and can be furnished to or be used by the City. This also includes goods purchased separately for City projects and goods purchased with installation services.

Procurement (Purchase) – Buying, purchasing, renting, leasing, or otherwise obtaining of any materials, equipment, supplies, or services. Also included are all activities related to obtaining the above items.

Proposal – A comparative written offer made by an intended consultant (professional services) or vendor (technical/maintenance services) for evaluation by City staff in reply to a Request for Proposal.

Public Project – “Public Project” shall have the meaning as set forth in the California Public Contract Code Sections 20161 and 22002, as amended.

Public Works Construction Project – A public construction project that is subject to the regulations of the state Public Contract Code, such as the erection, construction, alteration, major painting, repair, or demolition of public buildings, streets, walkways, water and sewer facilities, drainage facilities, or other public facilities, whether owned, leased, or operated by the City. Public works does not include maintenance work as defined in said Code.

Purchase Order – A document generated by the Finance Department after the bidding requirements have been met and the purchase has been awarded. A purchase order authorizes the purchase of goods or services. It is a written legal document signed by the Purchasing Officer, Finance Director, and/or Department Head (as required per the procurement limits) stating all terms and conditions of purchase transaction or referring to such terms and conditions as may exist in an accompanying contract.

Purchase Order Change Order – A change order to an existing purchase order may occur for a variety of reasons including, but not limited to, increasing the dollar amount of the purchase order, adding or deleting a line item, changing an account number on a line item, or increasing or decreasing the quantity on a line item.

Purchasing Officer – The City Administrator or a designated representative.

Purchase Requisition – A request for a purchase order. The request comes from the operating department that needs to order specific goods or services. This is completed through the City’s operating Finance software (Pentamation at the time of policy adoption).

Request for Proposal/Bid – The complete assembly of related documents (whether attached or by reference) furnished to a prospective consultant or vendor for specific services for the purpose of soliciting a proposal for a City professional service or technical/maintenance service procurement. These shall be evaluated and awarded based on a number of factors, rather than just price.

Request for Quotation/Bid – The complete assembly of related documents (whether attached or by reference) furnished to a prospective contractor/supplier for specific products or services for the purpose of presenting a quote for a City procurement. These shall be reviewed and awarded to the lowest responsible bidder.

Sole Source – Unique commodities or services that can be obtained from only one vendor or one distributor authorized to sell in the area or region, with singular characteristics or performance capabilities, or which have specific compatibility components with existing City products are exempt from the competitive bidding requirements and are deemed sole source purchases. Sole source purchases may include proprietary items sold directly from the manufacturer.

Solicitation – An invitation or request by which the City invites a person to participate in a procurement, such as an Invitation for Bids, a Request for Proposals, a Request for Qualifications, or a Request for Quotations.

Specification – A description in the bid, proposal, or quote of the sought item or service which informs prospective vendors what is specifically required and provides the basis for determining the responsive bid and the resulting purchase order or contract. In addition, it establishes the standard against which inspections and tests are made.

Uniform Construction Cost Accounting Procedures – Uniform construction cost accounting procedures shall mean those procedures and rules established by the State Uniform Construction Cost Accounting Commission pursuant to Section 22000, et seq. of the Public Contract Code.

Vendor – A seller of materials and supplies or technical/maintenance services, such as installation.

If any work is to be done by the vendor, it should be contracted via Standard Agreement. See Section 8 for procurement guidelines.

City Council Agenda Item #2
Staff Report
Date: November 4, 2024
To: Mayor and City Council
From: Elisa Arteaga, City Administrator
Subject: Approval of Transmission Rate Case Program through an agreement with NCPA Recommendation
It is recommended that the Gridley City Council

1. approve the City’s participation in the Transmission Rate Case Program through an agreement with the Northern California Power Agency (NCPA) to help manage and limit Gridley's exposure to rising transmission costs associated with CAISO and other markets.

2. Authorize the City Administrator to execute the agreement with NCPA and ensure funding allocation within the FY budget.

Background
The Transmission Rate Case Program, facilitated by NCPA, is designed to protect the interests of its participants, including Gridley, in transmission-related matters. Rising transmission costs imposed by the California Independent System Operator (CAISO) impact the City’s ability to provide affordable power to residents and businesses. Through this program, NCPA will advocate on behalf of the City and other participants in rate cases and proceedings affecting transmission costs. NCPA’s General Manager will consult with the City and other participants as needed and will propose annual goals as part of the budgeting process. NCPA will provide regular reports summarizing ongoing proceedings and schedules, financial impacts/assessments and, potential benefits, costs, and progress toward goals.

NCPA may engage qualified legal counsel and experts as needed. Costs incurred for these specialized services are considered part of the Program and will be billed to participants accordingly.

Financial Impact
Participation in this program will incur costs based on services rendered by NCPA, including legal counsel, subject matter experts, and other associated services. The City’s portion of these costs will be allocated as part of the annual budget. For this program, the FY 2025 budget is $580,000, so at a 0.45% share of the costs, Gridley’s expected budgeted cost would be $2,610 per year. Staff will closely monitor and review all expenditures and report back to the Council.

Compliance with City Council Strategic Plan or Budget Goals This program aligns with the City’s objective to manage energy-related costs effectively while safeguarding access to necessary transmission resources. By participating in NCPA's Transmission Rate Case Program, the City of Gridley can mitigate the risks of rising transmission costs and better represent its interests in crucial regulatory processes.

Attachments
Transmission Rate Case Program
Resolution No. 2024-R-042
X Regular
Special
Closed
Emergency

TRANSMISSION OWNER RATE CASE

PROGRAM AGREEMENT
TO Rate Case Program Agreement
i

TABLE OF CONTENTS
RECITALS.................................................................................................................................... 1 Section 1. Definitions ................................................................................................................. 2 Section 2. Services to be Provided, Duties and Standards of Performance ................. 5 Section 3. Administration of Agreement ............................................................................ 8 Section 4. Term and Termination......................................................................................... 9 Section 5. Admission and Withdrawal of Participants .................................................. 10 Section 6. Cost of Services ................................................................................................... 11 Section 7. Billing and Payments ......................................................................................... 12 Section 8. Cooperation and Further Assurances.............................................................. 13 Section 9. Participant Covenants and Defaults................................................................ 14 Section 10. Settlement of Disputes and Arbitration......................................................... 17 Section 11. Miscellaneous ...................................................................................................... 18 EXHIBIT A (List of Participants and Program Participation Percentages)..................A-1 TO Rate Case Program Agreement
1 This TRANSMISSION RATE CASE PROGRAM AGREEMENT (“the
Agreement”) is made effective as of _______________________ by and among the Northern California Power Agency, a joint powers agency of the State of California (“NCPA”) and those of its Members who execute this Agreement (“Participants”).

NCPA and the Participants are referred to herein individually as a “Party” and collectively as the “Parties”.

RECITALS
A. NCPA has heretofore been duly established as a public agency pursuant to the Joint Exercise of Powers Act of the Government Code of the State of California and, among other things, is authorized to acquire, construct, finance, and operate buildings, works, facilities and improvements for the generation and transmission of electric capacity and energy for resale.

B. Each of the Participants is a signatory to the Joint Powers Agreement which created NCPA and therefore is a Member.

C. Each of the Participants to this Agreement have executed the Power Management and Administrative Services Agreement, dated October 1, 2014, which establishes the framework under which Members who are signatory to the Power Management and Administrative Services Agreement may enter into one or more Service Agreements with NCPA.

D. Pursuant to the Power Management and Administrative Services Agreement, from time to time special conditions or requirements for services may be requested from NCPA by Members under which no existing Services Agreement is available to satisfy such needs, and at the sole discretion of the Commission, certain “one-off” agreements maybe developed between NCPA and a Member, or group of Members, to enable NCPA to provide such special services.

TO Rate Case Program Agreement
2 E. The Participants have requested NCPA to establish facilities, staff and the capability to act on behalf of the Participants to engage in certain activities, either directly, indirectly, or in conjunction with legal counsel and subject matter experts, pertaining to proceedings that effect the CAISO transmission costs, or other transmission costs as may be applicable, to protect the Participants’ transmission assets and to strive to limit the Participants’ exposure to increasing transmission costs when transacting in the CAISO markets, other markets, or as otherwise may be applicable.

F. In response to the Participants’ desire for NCPA to engage in the activities further described in this Agreement, NCPA has established the facilities, staff and the capability for the provision of Services to the Participants in accordance with this Agreement.

G. Each Participant agrees to pay its equitable share of costs associated with NCPA’s provision of Services, in accordance with the Power Management and Administrative Services Agreement and this Agreement.

H. The Participants further desire, insofar as possible, to insulate other Members, whether or not such Members are also Participants, from risks inherent in the services and transactions undertaken on behalf of any given Member or group of Members.

I. Upon full execution of this Agreement, this Agreement shall be deemed a Special Conditions Services Agreement under the Power Management and Administrative Services Agreement by the Commission.

J. Each of the Parties intends to observe the provisions of this Agreement in good faith and shall cooperate with all other Parties in order to achieve the full benefits of joint action.

NOW, THEREFORE, the Parties agree as follows:

Section 1. Definitions.

TO Rate Case Program Agreement
3 1.1 Definitions. Whenever used in this Agreement (including the Recitals hereto), the following terms shall have the following respective meanings, provided, capitalized terms used in this Agreement (including the Recitals hereto) that are not defined in Section 1 of this Agreement shall have the meaning indicated in Section 1 of the Power Management and Administrative Services Agreement:

1.1.1 “Administrative Services Costs” means that portion of the NCPA administrative, general and occupancy costs and expenses, including those costs and expenses associated with the operations, direction and supervision of the general affairs and activities of NCPA, general management, treasury operations, accounting, budgeting, payroll, human resources, information technology, facilities management, salaries and wages (including retirement benefits) of employees, facility operation and maintenance costs, taxes and payments in lieu of taxes (if any), insurance premiums, fees for legal, engineering, financial and other services, power management services, general settlement and billing and general risk management costs, that are charged directly or apportioned to the provision of Services pursuant to this Agreement. Administrative Services Costs as separately defined herein and used in the context of this Agreement is different and distinct from the term Administrative Services Costs as defined in Section 1 of the Power Management and Administrative Services Agreement.

1.1.2 “Agreement” means this Transmission Rate Case Program Agreement, including all Exhibits attached hereto.

1.1.3 “All Resources Bill” means the single, combined monthly bill from NCPA to a Participant with respect to all NCPA services, programs and NCPA Projects.

1.1.4 “Defaulting Participant” has the meaning set forth in Section

9.2 of this Agreement.

TO Rate Case Program Agreement
4 1.1.5 “Effective Date” has the meaning set forth in Section 4.1 of this Agreement.

1.1.6 “Event of Default” has the meaning set forth in Section 9.2 of this Agreement.

1.1.7 “NCPA” has the meaning set forth in the recitals hereto.

1.1.8 “Participant” has the meaning set forth in the recitals of this Agreement. Participants to this Agreement are listed in Exhibit A of this Agreement.

1.1.9 “Party” or “Parties” has the meaning set forth in the recitals hereto; provided that “Third Parties” are entities that are not part to this Agreement.

1.1.10 “Power Management and Administrative Services Agreement” means the NCPA Power Management and Administrative Services Agreement, dated as of October 1, 2014 between NCPA and the Members who are signatories to that agreement by which NCPA provides Power Management and Administrative Services.

1.1.11 “Program Participation Percentage” means the Participant Program Participation Percentages set forth in Exhibit A of this Agreement.

1.1.12 “Services” has the meaning set forth in Section 2.1 of this Agreement.

1.1.13 “Term” has the meaning set forth in Section 4.1 of this Agreement.

1.1.14 “Transmission Owner” or “TO” has the meaning set forth in the CAISO Tariff.

1.2 Rules of Interpretation. All words and references as used in this Agreement (including the Recitals hereto), unless in any such case the context requires TO Rate Case Program Agreement
5 otherwise, shall be interpreted pursuant to Section 1.2 of the Power Management and Administrative Services Agreement.

Section 2. Services to be Provided, Duties and Standards of Performance.

2.1 Services. The purpose of this Agreement is to set forth the terms and conditions under which NCPA, acting on behalf of the Participants, may engage in certain activities, either directly, indirectly, or in conjunction with legal counsel and subject matter experts, pertaining to proceedings that effect CAISO transmission costs, or other transmission costs as may be applicable, to protect the Participants’ transmission assets and to strive to limit the Participants’ exposure to increasing transmission costs when transacting in the CAISO markets, other markets, or as otherwise may be applicable (the “Services”). Participants shall only be responsible to pay for Services performed and costs incurred subsequent to the effective date of this Agreement. Services provided in accordance with this Agreement generally include the following:

2.1.1 Representing the interests of the Participants by monitoring, analyzing, and participating in TO rate cases before FERC and any related judicial appeals, where this applies to TO rate cases and new related transmission activity matters that are filed;

2.1.2 Engaging in other related filings and industry developments that affect the cost or provision of transmission service under TO rate cases; and

2.1.3 Engaging in other transmission cost related activities as may be approved by the Participants.

2.2 Qualified Subject Matter Experts. NCPA’s provision of Services under this Agreement may be supported by legal services and other specialized services relevant to NCPA’s participation in proceedings that are performed by qualified subject matter experts and/or witnesses. All costs incurred by NCPA associated with the TO Rate Case Program Agreement
6 acquisition of legal services support, or qualified subject matter experts support, associated with the Services Agreement shall be considered a Services cost pursuant to this Agreement.

2.3 Coordination with Third Parties. As part of NCPA’s duties under this Agreement, NCPA shall strive to work collaboratively with other Third Party intervenors and relevant parties, and where practicable, build alliances and find common interest in promoting the Participants’ interest consistent with the goals and objectives established pursuant to Section 2.8 of this Agreement. Such efforts include building coalitions, where strategically and economically viable, to support the alignment with other intervenors or to form “joint intervenor” perspectives for engaging in activities related to the Services provided hereunder. This joint effort may include coordinating and sharing responsibilities on areas of common interest to ensure the most efficient advancement of the Participants’ interest, and to reduce redundancy in the Services provided by NCPA.

2.4 Participant Duties. The duties of the Participants under this Agreement are to:

2.4.1 Timely provide information to NCPA that is required for NCPA to perform Services.

2.4.2 Make timely payments to NCPA for Services invoiced by NCPA to Participants in accordance with Section 7 of this Agreement.

2.4.3 Provide staff and other assistance, as may be required from time to time, to the extent necessary for NCPA to fulfill its duties under this Agreement.

2.5 NCPA Duties. NCPA’s General Manager, or his or her designee, shall establish and maintain the facilities, staff and the capability to act on behalf of the TO Rate Case Program Agreement
7 Participants and provide Services to the Participants in accordance with this Agreement.

2.6 Standard of Performance. NCPA will perform Services using the level of skill and attention reasonably required to complete the Services in a competent and timely manner.

2.7 Assignment of Personnel. NCPA shall assign only competent personnel to perform Services pursuant to this Agreement.

2.8 Time. NCPA shall devote such time to the performance of Services pursuant to this Agreement as may be reasonably necessary to meet the standards of performance provided in Section 2.6, and to satisfy NCPA’s obligations hereunder.

2.9 Consultation with Participants. The General Manager shall consult with the Participants from time to time, as needed, to advise him or her on a particular matter relevant to this Agreement. Each year, the General Manager shall propose to the Participants, as part of the Annual Budget process, specific goals and objectives for NCPA staff as such relate to this Agreement. NCPA shall provide periodic reports to the Participants regarding progress toward meeting the proposed goals and objectives.

The periodic reports may include the following information:
(a) Overview of relevant proceedings and known schedules; (b) Assessment of the financial impact to the Participants, to the extent practicable;
(c) Scope of NCPA’s potential engagement in each TO rate case; (d) Identification of potential legal actions that the Participants should consider and the likelihood of success (by argument if practicable); (e) Estimates of potential benefits and costs associated with engagement, to the extent practicable; and
TO Rate Case Program Agreement
8 (f) Summary of NCPA and Third Party issues and levels of participation.

Section 3. Administration of Agreement.

3.1 Commission. The Commission is responsible for the administration of this Agreement. Each Member shall be represented by its Commissioner or their designated alternate Commissioner (“Alternate”) pursuant to the Joint Powers Agreement. Each Commissioner shall have authority to act for the Participant under this Section 3 with respect to matters pertaining to this Agreement.

3.2 Duties and Authorities. In addition to the administration of this Agreement, the duties and authorities of the Commission are as specified in the Joint Powers Agreement and the NCPA Commission Bylaws.

3.3 Forum. Whenever any action anticipated by this Agreement is required to be jointly taken by the Participants, such action shall be taken at regular or special meetings of the NCPA Commission; provided, however, activities associated with NCPA’s provision of Services and normal day-to-day engagement as described in Section 2.1 of this Agreement, are hereby delegated to the General Manager of NCPA, or his or her designee, and are not considered to be matters related to the Commission’s general administration of this Agreement, and therefore are not subject to the administrative procedures set forth in this Section 3.

3.4 Quorum. For purposes of acting upon matters that relate to the administration of this Agreement, a quorum of the Commission shall consist of those Commissioners, or their designated Alternates, representing a numerical majority of the Participants.

3.5 Voting. For acting upon matters that relate to the general administration of this Agreement, each Participant shall have the right to cast one (1) vote. Actions of the Commission shall be effective only upon an affirmative vote of Participants TO Rate Case Program Agreement
9 representing a combined Program Participation Percentage of eighty percent (80%) or more.

3.6 Adoption and Amendment of Annual Budget. Annually, the Commission shall adopt an Annual Budget, which includes, but is not limited to, all costs attributed to Services, for at least the next succeeding Fiscal Year in accordance with the NCPA Joint Powers Agreement and this Agreement. Provided, however, that the Commission may in its discretion adopt a two-year budget if permitted to do so by the NCPA Commission Bylaws or the Joint Powers Agreement.

3.7 Facilities Committee. The Facilities Committee has been established pursuant to the Amended and Restated Facilities Agreement to act as an advisory committee to the Commission. The Commission or General Manager may refer matters pertaining to the administration of this Agreement to the Facilities Committee for review and recommendation, including, but not limited to, proposed amendments to this Agreement. If the Commission or General Manager refers matters pertaining to the administration of this Agreement to the Facilities Committee, NCPA will provide a copy of the public notice of the Facilities Committee meeting at which the matter will be discussed to the Participants. The Facilities Committee may act upon such matters referred to it by the Commission in accordance with the procedures, including the general administration quorum and voting procedures, set forth in the Amended and Restated Facilities Agreement. Any recommendation of the Facilities Committee shall be made to the Commission and others, as appropriate, in coordination with the General Manager.

Section 4. Term and Termination.

4.1 Effective Date. This Agreement shall become effective on the first day of the month after which it has been duly executed by all Participants, and delivered to TO Rate Case Program Agreement
10 and executed by NCPA (the “Effective Date”). NCPA shall notify all Participants in writing of the Effective Date.

4.2 Term and Termination. The term (“Term”) Agreement shall continue in full effect until terminated by consent of all Parties.

Section 5. Admission and Withdrawal of Participants.

5.1 Admission of a New Participant. Following the initial Effective Date of this Agreement, a Member may voluntarily elect to execute this Agreement and become a Participant provided that such joinder is (i) approved by the NCPA Commission in accordance with Section 3.5 of this Agreement, and (ii) if such joinder is approved by the NCPA Commission as set forth herein, the Commission shall also amend the Program Participant Percentages set forth in Exhibit A to this Agreement to include the Program Participant Percentage for the new Participant as determined by the NCPA Commission. Subject to the requirement of this Section 5.1, such Member will become a Participant effective on the date of its delivery to NCPA of an executed counterpart of this Agreement.

5.2 Withdrawal of Participants. Any Participant may withdraw from this Agreement (“Withdrawing Participant”) by submitting notice, in writing to all Parties at least two (2) years in advance of the effective date of such withdrawal, provided that such withdrawal shall only be effective on the last day of a Fiscal Year and that the Withdrawing Participant has fully satisfied all obligations it has incurred under this Agreement. The two (2) year duration of the notice requirement may be waived or reduced by the Commission in its sole discretion. Withdrawal by any Participant shall not terminate this Agreement as to the remaining Participants.

5.3 No Effect on Prior Liabilities. Withdrawal by any Participant will not terminate any ongoing or un-discharged liabilities, credits or obligations, including any contingent liabilities, credits or obligations, resulting from this Agreement until they are TO Rate Case Program Agreement
11 satisfied in full, or such Withdrawing Participant has provided a mechanism acceptable to NCPA, for the satisfaction in full thereof.

5.4 A Withdrawing Participant shall not be obligated to compensate the remaining Participants for loss of any benefits that would have accrued to the remaining Participants if the Withdrawing Participant had continued its participation.

Nor shall the remaining Participants be obligated to compensate the Withdrawing Participant for any benefits that accrue to the remaining Participants because of the withdrawal. Reallocation of the costs and benefits of continuing under this Agreement after a Participant has withdrawn shall not give rise to any claim against a Withdrawing Participant by the remaining Parties. Nor shall any of the remaining Parties be obligated to compensate the Withdrawing Participant for any benefits that accrue to the remaining Parties because of such a reallocation of costs and benefits.

5.5 Associated Costs. A Withdrawing Participant shall reimburse NCPA for any and all costs resulting from the withdrawal, including but not limited to the legal, accounting, and administrative costs of winding up and assuring the complete satisfaction and discharge of the Withdrawing Participant’s liabilities, credits or obligations, including any contingent liabilities, credits or obligations.

Section 6. Cost of Services.

6.1 Cost Allocation. All costs associated with NCPA’s provision of Services to the Participants, including, but not limited to, Administrative Services Costs and costs associated with NCPA’s acquisition of legal services and qualified subject matter experts services, shall be allocated among the Participants in accordance with this Agreement and the Power Management and Administrative Services Agreement. Costs allocated among the Participants in accordance with this Agreement shall be allocated to each Participant in proportion to such Participant’s Program Participation Percentage as set forth in Exhibit A of this Agreement.

TO Rate Case Program Agreement
12 6.2 Program Participation Percentages. The Program Participation Percentages as set forth in Exhibit A of this Agreement may be amended from time to time, including to account for the addition or withdrawal of a Participant as set forth in Section 5 of this Agreement, by the Commission in accordance with the voting procedures set for in Section 3 of this Agreement.

Section 7. Billing and Payments.

7.1 Invoices. NCPA will issue an invoice to each Participant for its share of costs associated with Services, and all other costs for services provided in accordance with this Agreement. Such invoice may be either the All Resources Bill or separate special invoice, as determined by NCPA. Such invoices will be made pursuant to the requirements and procedures provided for in this Agreement and all other applicable agreements. At NCPA’s discretion, invoices may be issued to Participants using electronic media or physical distribution.

7.2 Payment of Invoices. All invoices delivered by NCPA (including the All Resources Bill) are due and payable thirty (30) Calendar Days after the date thereof; provided, however, that any amount due on a day other than a Business Day may be paid on the following Business Day.

7.3 Late Payments. Any amount due and not paid by a Participant in accordance with Section 9.2 shall be considered late and bear interest computed on a daily basis until paid at the lesser of (i) the per annum prime rate (or reference rate) of the Bank of America NT&SA then in effect, plus two percent (2%) or (ii) the maximum rate permitted by law.

7.4 Billing Disputes. A Participant may dispute the accuracy of any invoice issued by NCPA under this Agreement by submitting a written dispute to NCPA, within thirty (30) Calendar Days of the date of such invoice; nonetheless the Participant shall pay the full amount billed when due. If a Participant does not timely question or TO Rate Case Program Agreement
13 dispute the accuracy of any invoice in writing the invoice shall be deemed to be correct.

Upon review of a submitted dispute, if an invoice is determined by NCPA to be incorrect, NCPA shall issue a corrected invoice and refund any amounts that may be due to the Participant. If NCPA and the Participant fail to agree on the accuracy of an invoice within thirty (30) Calendar Days after the Participant has disputed it, the General Manager shall promptly submit the dispute to the Commission for resolution.

If the Commission and the Participant fail to agree on the accuracy of a disputed invoice within sixty (60) Calendar Days of its submission to the Commission, the dispute may then be resolved under the mediation and arbitration procedures set forth in Section 10 of this Agreement. Provided, however, that prior to resort to either mediation or arbitration proceedings, the full amount of the disputed invoice must have been paid.

7.5 Billing/Settlement Data and Examination of Books and Records.

7.5.1 Settlement Data. NCPA shall make billing and settlement data available to the Participants in the All Resources Bill, or other invoice, or upon request. NCPA may also, at its sole discretion, make billing and settlement support information available to Participants using electronic media (e.g. electronic data portal). Procedures and formats for the provision of such electronic data submission may be as established by the NCPA Commission from time to time.

Without limiting the generality of the foregoing, NCPA may, in its reasonable discretion, require the Participants to execute a non-disclosure agreement prior to providing access to the NCPA electronic data portal.

7.5.2 Examination of Books and Records. Any Participant to this Agreement shall have the right to examine the books and records created and maintained by NCPA pursuant to this Agreement at any reasonable, mutually agreed upon time.

Section 8. Cooperation and Further Assurances.

TO Rate Case Program Agreement
14 8.1 Each of the Parties agree to provide such information, execute and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by any other Party which are consistent with the provisions of this Agreement and which do not involve the assumption of obligations other than those provided for in this Agreement, in order to give full effect to this Agreement and to carry out the intent of this Agreement.

Section 9. Participant Covenants and Defaults.

9.1 Each Participant covenants and agrees: (i) to make payments to NCPA, from its Electric System Revenues, of its obligations under this Agreement as an operating expense of its Electric System; (ii) to fix the rates and charges for services provided by its Electric System, so that it will at all times have sufficient Revenues to meet the obligations of this Agreement, including the payment obligations; (iii) to make all such payments due NCPA under this Agreement whether or not there is an interruption in, interference with, or reduction or suspension of services provided under this Agreement, such payments not being subject to any reduction, whether by offset or otherwise, and regardless of whether any dispute exists; and (iv) to operate its Electric System, and the business in connection therewith, in accordance with Good Utility Practice.

9.2 Events of Default. An Event of Default under this Agreement shall exist upon the occurrence of any one or more of the following by a Participant (the “Defaulting Participant”):
(i) the failure of any Participant to make any payment in full to NCPA when due, where such failure is not cured within thirty (30) Calendar Days following receipt of a notice from NCPA demanding cure;
(ii) the failure of a Participant to perform any covenant or obligation of this Agreement where such failure is not cured within thirty (30) Calendar Days TO Rate Case Program Agreement
15 following receipt of a notice from NCPA demanding cure. Provided, that this subsection shall not apply to any failure to make payments specified by subsection 9.2 (i));
(iii) if any representation or warranty of a Participant material to the services provided hereunder shall prove to have been incorrect in any material respect when made and the Participant does not cure the facts underlying such incorrect representation or warranty so that the representation or warranty becomes true and correct within thirty (30) Calendar Days of the date of receipt of notice from NCPA demanding cure; or
(iv) if a Participant is in default or in breach of any of its covenants under any other agreement with NCPA and such default or breach is not cured within the time periods specified in such agreement.

9.3 Uncontrollable Forces. A Party shall not be considered to be in default in respect of any obligation hereunder if prevented from fulfilling such obligation by reason of Uncontrollable Forces. Provided, that in order to be relieved of an Event of Default due to Uncontrollable Forces, a Party affected by an Uncontrollable Force shall:
(i) first provide initial notice to the General Manager using telephone communication within two (2) Business Days of the onset of the Uncontrollable Force, and second provide further written notice to the General Manager and all other Parties within ten (10) Business Days of the onset of the Uncontrollable Force, describing its nature and extent, the obligations which the Party is unable to fulfill, the anticipated duration of the Uncontrollable Force, and the actions which the Party will undertake so as to remove such disability and be able to fulfill its obligations hereunder; and (ii) use due diligence to place itself in a position to fulfill its obligations hereunder and if unable to fulfill any obligation by reason of an Uncontrollable Force such Party shall exercise due diligence to remove such disability with reasonable TO Rate Case Program Agreement
16 dispatch. Provided, that nothing in this subsection shall require a Party to settle or compromise a labor dispute.

9.4 Cure of an Event of Default. An Event of Default shall be deemed cured only if such default shall be remedied or cured within the time periods specified in Section 9.2 above, as may be applicable, provided, however, upon request of the Defaulting Participant the Commission may waive the default at its sole discretion, where such waiver shall not be unreasonably withheld.

9.5 Remedies in the Event of Uncured Default. Upon the occurrence of an Event of Default which is not cured within the time limits specified in Section 9.2, without limiting other rights or remedies available under this Agreement, at law or in equity, and without constituting or resulting in a waiver, release or estoppel of any right, action or cause of action NCPA may have against the Defaulting Participant, NCPA may, for so long as such Event of Default continues uncured, take any or all of the following actions:
(i) suspend the provision of services under this Agreement to such Defaulting Participant;
(ii) demand that the Defaulting Participant provide further assurances to guarantee the correction of the default, including the collection of a surcharge or increase in electric rates, or such other actions as may be necessary to produce necessary Revenues to correct the default;
(iii) terminate this Agreement as to the Defaulting Participant, on ten (10) Calendar Days prior written notice to the Defaulting Participant; or (iv) enforce all other rights or remedies available to it under any other agreement in which the Defaulting Participant is a signatory.

9.6 Effect of Termination or Suspension.

TO Rate Case Program Agreement
17 9.6.1 Generally. The termination or suspension of this Agreement will not terminate, waive, or otherwise discharge any ongoing or undischarged liabilities, credits or obligations arising from this Agreement until such liabilities, credits or obligations are satisfied in full.

9.6.2 Suspension. If performance of all or any portion of this Agreement is suspended by NCPA with respect to a Participant in accordance with subsection 9.5 (i), such Participant shall pay any and all costs incurred by NCPA as a result of such suspension including reasonable attorney fees, the fees and expenses of other experts, including auditors and accountants, or other reasonable and necessary costs associated with such suspension and any portion of the costs associated with NCPA’s provision of Services, including Administrative Services Costs, that were not recovered from such Participant as a result of such suspension.

9.7 Termination. If this Agreement is terminated by NCPA with respect to a Participant in accordance with Section 9.5 (iii), such Participant shall pay any and all costs incurred by NCPA as a result of such termination, including reasonable attorney fees, the fees and expenses of other experts, including auditors and accountants, other reasonable and necessary costs associated with such termination and any portion of costs associated with NCPA’s provision of Services that were not, or will not be, recovered from such Participant as a result of such termination; provided, however, if NCPA terminates this Agreement with respect to the last remaining Participant, then this Agreement shall terminate.

Section 10. Settlement of Disputes and Arbitration.

10.1 The Parties agree to make best efforts to settle all disputes among themselves connected with this Agreement as a matter of normal business under this Agreement. The procedures set forth in Section 10 of the Power Management and Administrative Services Agreement shall apply to all disputes that cannot be settled by TO Rate Case Program Agreement
18 the Participants themselves; provided, that the provisions of Section 7.4 shall first apply to all disputes involving invoices prepared by NCPA.

Section 11. Miscellaneous.

11.1 Confidentiality. The Parties will keep confidential all confidential or trade secret information made available to them in connection with this Agreement, to the extent possible, consistent with applicable laws, including the California Public Records Act. Confidential or trade secret information shall be marked or expressly identified as such.

If a Party (“Receiving Party”) receives a request from a Third Party for access to, or inspection, disclosure or copying of, any of the other Party’s (the “Supplying Party”) confidential data or information (“Disclosure Request”), then the Receiving Party shall provide notice and a copy of the Disclosure Request to the Supplying Party within three (3) Business Days of receipt of the Disclosure Request. Within three (3) Business Days of receipt of such notice, the Supplying Party shall provide notice to the Receiving Party either:
(i) that the Supplying Party believes there are reasonable legal grounds for denying or objecting to the Disclosure Request, and the Supplying Party requests the Receiving Party to deny or object to the Disclosure Request with respect to identified confidential information. In such case, the Receiving Party shall deny the Disclosure Request and the Supplying Party shall defend the denial of the Disclosure Request at its sole cost, and it shall indemnify the Receiving Party for all costs associated with denying or objecting to the Disclosure Request. Such indemnification by the Supplying Party of the Receiving Party shall include all of the Receiving Party’s costs reasonably incurred with respect to denial of or objection to the Disclosure Request, including but not limited to costs, penalties, and the Receiving Party’s attorney’s fees; or TO Rate Case Program Agreement
19 (ii) the Receiving Party may grant the Disclosure Request without any liability by the Receiving Party to the Supplying Party.

11.2 Indemnification and Hold Harmless. Subject to the provisions of Section

11.4, each Participant agrees to indemnify, defend and hold harmless NCPA and its Members, including their respective governing boards, officials, officers, agents, and employees, from and against any and all claims, suits, losses, costs, damages, expenses and liability of any kind or nature, including reasonable attorneys’ fees and the costs of litigation, including experts, to the extent caused by any acts, omissions, breach of contract, negligence (active or passive), gross negligence, recklessness, or willful misconduct of that Participant, its governing officials, officers, employees, subcontractors or agents, to the maximum extent permitted by law.

11.3 Several Liabilities. Except as otherwise provided herein, no Participant shall be liable under this Agreement for the obligations of any other Participant, each Participant shall be solely responsible and liable for performance of its obligations under this Agreement and the obligation of each Participant under this Agreement is a several obligation and not a joint obligation with those of the other Participants.

11.4 No Consequential Damages. FOR ANY BREACH OF ANY PROVISION

OF THIS AGREEMENT FOR WHICH AN EXPRESS REMEDY OR MEASURE OF

DAMAGES IS PROVIDED IN THIS AGREEMENT, THE LIABILITY OF THE

DEFAULTING PARTY SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION, AND ALL OTHER DAMAGES OR REMEDIES ARE HEREBY WAIVED. IF NO

REMEDY OR MEASURE OF DAMAGE IS EXPRESSLY PROVIDED, THE LIABILITY

OF THE DEFAULTING PARTY SHALL BE LIMITED TO ACTUAL DAMAGES ONLY AND ALL OTHER DAMAGES AND REMEDIES ARE HEREBY WAIVED. IN NO

EVENT SHALL NCPA OR ANY PARTICIPANT OR THEIR RESPECTIVE

SUCCESSORS, ASSIGNS, REPRESENTATIVES, DIRECTORS, OFFICERS, AGENTS, TO Rate Case Program Agreement
20 OR EMPLOYEES BE LIABLE FOR ANY LOST PROFITS, CONSEQUENTIAL,

SPECIAL, EXEMPLARY, INDIRECT, PUNITIVE OR INCIDENTAL LOSSES OR

DAMAGES, INCLUDING LOSS OF USE, LOSS OF GOODWILL, LOST REVENUES,

LOSS OF PROFIT OR LOSS OF CONTRACTS EVEN IF SUCH PARTY HAS BEEN

ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND NCPA AND EACH

PARTICIPANT EACH HEREBY WAIVES SUCH CLAIMS AND RELEASES EACH OTHER AND EACH OF SUCH PERSONS FROM ANY SUCH LIABILITY.

11.5 The Parties acknowledge that California Civil Code section 1542 provides that: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” The Parties waive the provisions of section 1542, or other similar provisions of law, and intend that the waiver and release provided by this Section of this Agreement shall be fully enforceable despite its reference to future or unknown claims.

11.6 Waiver. No waiver of the performance by a Party of any obligation under this Agreement with respect to any default or any other matter arising in connection with this Agreement shall be effective unless given by the Commission. Any such waiver by the Commission in any particular instance shall not be deemed a waiver with respect to any subsequent performance, default or matter.

11.7 Amendments. Amendments to the Program Participation Percentages as set forth in Exhibit A of this Agreement shall take effect after being approved by the Commission in a manner consistent with the voting procedures set forth in Section 3 of this Agreement, without the requirement of an approval of the individual Participants’ governing bodies. Except where this Agreement specifically provides otherwise, this Agreement may be amended only by written instrument executed by the Parties with the same formality as this Agreement.

TO Rate Case Program Agreement
21 11.8 Assignment of Agreement.

11.8.1 Binding Upon Successors. This Agreement shall inure to the benefit of and shall be binding upon the respective successors and assignees of the Parties to this Agreement.

11.8.2 No Assignment. This Agreement, nor any interest herein, shall be transferred or assigned by a Party hereto except with the consent in writing of the other Parties hereto, where such consent shall not be unreasonably withheld.

Without limiting the foregoing, this Agreement shall not be assigned by PlumasSierra Rural Electric Cooperative without the approval in writing of the Administrator of the Rural Electrification Administration Utilities Service.

11.9 Severability. In the event that any of the terms, covenants or conditions of this Agreement or the application of any such term, covenant or condition, shall be held invalid as to any person or circumstance by any court having jurisdiction, all other terms, covenants or conditions of this Agreement and their application shall not be affected thereby, but shall remain in force and effect unless the court holds that such provisions are not severable from all other provisions of this Agreement.

11.10 Governing Law. This Agreement shall be interpreted, governed by, and construed under the laws of the State of California.

11.11 Headings. All indices, titles, subject headings, section titles and similar items are provided for the purpose of convenience and are not intended to be inclusive, definitive, or affect the meaning of the contents of this Agreement or the scope thereof.

11.12 Notices. Any notice, demand or request required or authorized by this Agreement to be given to any Party shall be in writing, and shall either be personally delivered to a Participant’s Commissioner or Alternate, and to the General Manager, or shall be transmitted to the Participant and the General Manager at the addresses shown on the signature pages hereof. The designation of such addresses may be changed at TO Rate Case Program Agreement
22 any time by written notice given to the General Manager who shall thereupon give written notice of such change to each Participant. All such notices shall be deemed delivered when personally delivered, two (2) Business Days after deposit in the United States mail first class postage prepaid, or on the first Business Day following delivery through electronic communication.

11.13 Warranty of Authority. Each Party represents and warrants that it has been duly authorized by all requisite approval and action to execute and deliver this Agreement and that this Agreement is a binding, legal, and valid agreement enforceable in accordance with its terms.

11.14 Counterparts. This Agreement may be executed in any number of counterparts, and each executed counterpart shall have the same force and effect as an original instrument and as if all the signatories to all of the counterparts had signed the same instrument. Any signature page of this Agreement may be detached from any counterpart of this Agreement without impairing the legal effect of any signatures thereon, and may be attached to another counterpart of this Agreement identical in form hereto but having attached to it one or more signature pages.

11.15 Venue. In the event that a Party brings any action under this Agreement, the Parties agree that trial of such action shall be vested exclusively in the state courts of California in the County of Placer or in the United States District Court for the Eastern District of California.

11.16 Attorneys’ Fees. If a Party to this Agreement brings any action, including an action for declaratory relief, to enforce or interpret the provisions of this Agreement, each Party shall bear its own fees and costs, including attorneys’ fees, associated with the action.

11.17 Counsel Representation. Pursuant to the provisions of California Civil Code Section 1717 (a), each of the Parties were represented by counsel in the negotiation TO Rate Case Program Agreement
23 and execution of this Agreement and no one Party is the author of this Agreement or any of its subparts. Those terms of this Agreement which dictate the responsibility for bearing any attorney’s fees incurred in arbitration, litigation or settlement in a manner inconsistent with the provisions of Section 11.2 were intentionally so drafted by the Parties, and any ambiguities in this Agreement shall not be interpreted for or against a Party by reason of that Party being the author of the provision.

11.18 No Third Party Beneficiaries. Nothing contained in this Agreement is intended by the Parties, nor shall any provision of this Agreement be deemed or construed by the Parties, by any third person or any Third Parties, to be for the benefit of any Third Party, nor shall any Third Party have any right to enforce any provision of this Agreement or be entitled to damages for any breach by the Parties of any of the provisions of this Agreement.

TO Rate Case Program Agreement
Signature Page 1
IN WITNESS WHEREOF, NCPA and each Participant have, by the signature of its duly authorized representative shown below, executed and delivered a counterpart of this Agreement.

NORTHERN CALIFORNIA

POWER AGENCY
651 Commerce Drive
Roseville, CA 95678
_____________________________
By:__________________________
Title: __________________________
Date: