Agenda packet — Hollister City Council, June 20, 2023 (part 3 of 4)

Calendar Year 2022. The employee-only premium for medical insurance shall in accordance with Section [C] above.

2. Employee Option for Dependent Coverage

Starting Calendar Year 2022, for those employees who elect the option for dependent coverage for medical, dental, and vision insurance plans, the City shall contribute monthly amounts equal to the employee plus one and employee plus family toward such dependent coverage in accordance with Section [C] above. This section does not affect the current coverage for Calendar year 2021.

F. For those employees who elect the option for dependent coverage for medical, dental, and vision insurance plans, the City shall contribute monthly amounts equal to the employee plus one and employee plus family toward such dependent coverage in accordance with Section [C] above.

G.F.Vision Insurance

The City shall provide a vision care insurance plan which is available to eligible unit members and qualified dependents during the term of this M.O.U.

The City shall offer vision care insurance for employees and qualified dependents as a pre-tax flexible benefit option. Participation and coverage shall be in accordance with the terms and conditions of the insurance carrier.

G. Dental Insurance

The City shall offer dental care insurance for employees and qualified dependents as a pre-tax flexible benefit option. Participation and coverage shall be in accordance with the terms and conditions of the insurance carrier.

H. Life Insurance

The City shall provide term life insurance in the amount equal to $50,000.00 for each member of the unit for the term of this M.O.U. Additional term life insurance may be purchased by the employee in increments of $10,000.00 up to a total of $250,000.00.

I. Long Term Disability Insurance

The City agrees to provide to all employees within this unit at City cost a Supplemental Long Term Disability Plan, coordinated with other existing benefits to provide no more than a thirty (30) day exclusion or elimination period; no less than a one year benefit for accident or illness; and a minimum scheduled benefit of sixty-six percent (66%) or two-thirds (2/3) of gross salary to a maximum of $3,500.00 per month for the term of this M.O.U.. The City in its sole discretion shall select the Supplemental Long Term Disability Plan carrier that meets these requirements.

J. Health Insurance Waiver Option
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1. Effective January 1, 2014, employees within this bargaining unit who elect not to participate in the City's health care insurance program will be compensated in an amount as follows:

$535 Employee Only
$1,075 Employee plus one
$1,380 Employee plus family

The compensation will be based on the level in which the employee was participating (employee only, employee plus one dependent, employee plus two or more dependents) at the time of waiving City insurance coverage in accordance with Section [3] below. This cash amount will be paid as part of the employee's bi-weekly payroll.

2. Employees within this bargaining unit shall be eligible to elect not to participate in the City's health care program.

3. Employees within this bargaining unit electing not to participate in the City's health care insurance program must annually provide proof of medical insurance coverage in order to maintain payment under this waiver option.

4. In addition to the coverage options specified under Article 7. Insurance of the Memorandum of Understanding between the City of Hollister and the Service Employees International Union, Local 521, the following optional health benefits shall be available to the employees of this bargaining unit.

K. Optional Health Benefits

Employees that have elected to participate in a City offered medical plan can also elect to participate in the optional benefits. If the employee has any surplus flex credits after making all elections required to participate in the medical insurance, the employee can use that surplus toward optional qualified insurance benefits or one or both of the pre-tax spending accounts. Employees that wish to participate in the optional benefits plan, but do not have any surplus credits, can elect to have pre -tax payroll deductions in an amount to cover the cost of their elections.

Employees may pay the premiums for the following benefits on a voluntary basis:
- Medical Insurance
- Dental Insurance
- Vision Insurance
- Group Term Insurance up to $50,000.00 for Employees only - Accidental Death and Dismemberment Insurance
- Short Term Disability
- Cancer Insurance
- Supplemental Health Insurance
- Accidental Only Insurance
- Intensive Care Insurance
L. Flexible Spending Accounts (FSA's)

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The City agrees to establish a pre-tax dependent care reimbursement account up to the maximum reimbursement allowed by law.

The City agrees to establish a pre-tax medical reimbursement account, up to two thousand five hundred dollars ($2,500.00) per year per employee.

M. Voluntary Life Insurance

The City shall offer a voluntary supplemental life insurance plan through the flexible benefits plan for pre-tax contributions by the employees. Participation and coverage shall be in accordance with the terms and conditions of the insurance carrier. Employees may also elect pre-tax payroll deductions to support other City sponsored voluntary supplemental insurance benefits.

N. Miscellaneous

The City of Hollister does not allow the employee to take the surplus credits in taxable cash.

For employees who elect not to participate in the group medical coverage offered by the City, the City will provide dental and vision coverage for the employee and his/her dependents at no cost to the employee.

O. Cost-Savings

During the term of this agreement, the parties agree that upon request to meet and discuss regarding potential cost savings/sharing measures related to health and welfare plan designs or premiums.

Article 8. Job Related Disabilities and the Americans with Disabilities Act

A. Job Related Disabilities
City agrees to comply with the Labor Code of the State of California for employees within this unit deemed disabled or temporarily disabled as a result and because of such job related injury which requires them to be absent from active City service.

B. Americans with Disabilities Act

The parties recognize that the City may be required to make accommodations in order to carry out its obligations under the Americans with Disabilities Act (ADA). Some of the accommodations may require actions which are contrary to the language or intent of existing provisions of this agreement. The parties agree that such accommodation relating to ADA shall not constitute a 'past practice' or waiver by either party of its right to fully enforce such provisions in the future with regard to persons not subje ct to the protection of the ADA. The parties recognize that circumstances surrounding ADA compliance in individual cases may involve matters which are personal and require the utmost confidentiality. Specifics of an individual case may not be divulged by the City. However, the City, when the release of information is either authorized or will not violate confidentiality, will notify the Union when an accommodation has been made that affects other employees in the workplace. Accommodations made by the City under this Article shall not be subject to the grievance procedure.

Article 9. Safety Compliance and Equipment
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A. Safety Compliance

The City and Union shall meet the requirements of Cal OSHA. The Union further agrees to bring any safety concerns immediately to the attention of management.

The City and the Union shall cooperate in pursuing safe working practices and shall establish a joint safety committee to address workplace safety concerns and develop actions that can be taken to address them. The committee shall meet on an as-needed basis, at the written request of either party, within ten (10) working days of such request or at another mutually agreed upon time. The committee shall consist of a minimum of two (2) union representatives and two (2) City representatives.

B. Safety Boot Allowance

All eligible unit employees, including employees assigned to the Public Works Department Operations and Maintenance Section which also includes the Public Works Inspector, Utilities, Streets, Parks, and Buildings & Grounds Divisions, Development Services Department employees that work out in the field, and eligible unit employees assigned to the Animal Control Division of the Police Department shall be reimbursed up to three hundred dollars ($300.00) per year, upon presentation of satisfactory proof-of-purchase, for safety shoes or boots which are approved and authorized by City management.

Used safety shoes and boots are the property of the City and shall be returned to the City.

This allowance is to assist employees in purchasing City-approved work shoes and/or boots appropriate for the type of work being performed in accordance with General Industry Safety Orders, Title 8, Section 3385. Appropriate safety shoes and boots shall incorporate the following safety factors depending on the type of work performed:
1) Non-skid sole
2) Adequate ankle protection
3) Puncture protection
4) Impact/compression protection
C. Animal Control Safety Equipment

The City agrees to provide necessary safety equipment for the classifications of Animal Control Officer and Animal Control Officer Assistant. This equipment may include, but not be limited to, bullet proof vests, utility belts, and bite sticks. This equipment will be purchased by the City at no cost to unit members.

D. CPR Training

From time to time, the City may offer CPR Training through the Certified Trainer with the City Fire Department. Subject to department needs. Employees may be granted release time to participate in this training.

E. Public Works Safety Equipment

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The City agrees to provide necessary training and safety equipment for the classification of:

 Assistant Equipment Mechanic
 Equipment Mechanic
 Jr. Water Maintenance Operator
 Water Maintenance Operator I/II
 Maintenance Worker I/II
 Senior Maintenance Worker
 Tree Trimmer
 Airport Maintenance & Operations Specialist
 Street Sweeper Operator

This equipment may include, but not limited to: appropriate gloves, safety glasses, ear protection, chaps, hard hats, safety vests and breathing masks.

This equipment will be purchased by the City at no cost to unit members.

Article 10. Grievance Procedure

This grievance procedure shall be the sole and exclusive procedure for resolving grievances filed by employees covered by this M.O.U.

A. Definition

A grievance is a claimed violation, misapplication, or misinterpretation of a specific provision of this agreement or the City's Personnel System Rules and Regulations which adversely affects the grievant.

B. Stale Grievance

A grievance shall be void unless filed in writing within fifteen (15) calendar days from the date upon which the City is alleged to have misinterpreted or misapplied this agreement, or within fifteen (15) calendar days from the time an employee might reasonably have been expected to have learned of the alleged misinterpretation or misapplication. Such discovery period shall not exceed 180 days regardless of the date of discovery. In no event shall a grievance include a claim for money relief for more than the fifteen (15) day period plus such reasonable discovery period.

C. Informal Discussion with Employee's Supervisor

Before proceeding to the formal grievance procedure, an employee shall discuss his/her grievance with his/her immediate supervisor in private and attempt to work out a satisfactory solution. Any solution reached at this level must be reviewed by the Personnel Officer to assure compliance with this agreement before it has any binding effect.

D. Formal Written Grievance to Employee's Supervisor

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If the employee chooses to formally pursue his/her grievance, he/she or his/her representative shall present the written grievance to his/her immediate within five (5) working days after the date upon which the grieving employee informally discusses the grievance with the supervisor. (In the event a group grievance is formally submitted by the recognized employee organization, its initial submission will be to the department head and subsequent steps will be followed as outlined in this section.) The formal written grievance shall specify the provisions of this M.O.U. or the City's Personnel System Rules and Regulations alleged to have been misinterpreted or misapplied, the remedy sought, and such other specific dates, times, places and persons and other facts necessary to derive a clear understanding of the matter being grieved. The immediate supervisor shall return a copy of the written grievance to the employee with the supervisor's answer thereto in writing within five (5) working days from receipt of the supervisor's answer within which to file an appeal to the next level.

E. Grievance to Department Head/City Manager

The department head or the City Manager, if the department head was the grievant's immediate supervisor, shall have seven (7) working days in which to review and answer the grievance in writing.

Unless waived by mutual agreement of the employee or his/her representative and the department head or City Manager, a meeting is required at this level and the employee and his/her representative shall have the right to be present and participate in such a meeting. The time limits at this level may be extended by mutual agreement between the department head or City Manager and the employee or his/her representative.

F. Waiver of Appeal Steps

If the grievance is not resolved after the immediate supervisor has answered it in writing, the g rievant(s) and the department head may, by mutual agreement, waive review of the grievance at Step E and proceed to present the grievance to the City Manager.

G. Advisory Fact Finding of Grievances

In the event the grievance is not resolved by the City Manager, the recognized employee organization may with fifteen (15) calendar days after receipt of the decision of the City Manager, request that the grievance be heard by a fact finder.

H. Selection of a Fact Finder

The fact finder shall be selected by mutual agreement between the City and the Union. If the parties are unable to agree on the selection of a fact finder, they shall jointly request the State Mediation and Conciliation Service to submit a list of five (5) qualified fact finders. The City and the grievant, or his/her representative, shall then alternately strike names from the list until only one name remains, and that person shall serve as fact finder.

I. Duty of Fact Finder

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Except when an agreed statement of facts is submitted by the parties, it shall be the duty of the fact finder to hear and consider evidence submitted by the parties and to thereafter make written findings of fact and a proposed disposition of the grievance which shall be advisory in nature.

The proposed disposition shall be based solely on the interpretation of the applicable provisions of the M.O.U. and other personnel rules if applicable to the grievance, and he/she shall not add to, subtract from, modify or disregard any of the terms or provisions of the M.O.U. or such rules.

J. Payment of Costs

Each party to a hearing before a fact finder shall bear its own expenses in connection therewith. All fees and expenses of the fact finder shall be borne one-half by the City and one-half by the grievant.

If the City does not implement the proposed disposition of the grievance made by the fact finder, the City shall pay all fees and expenses of the fact finder.

K. Effect of Failure of Timely Action

Failure of the employee(s) to file an appeal within the required time period at any level shall constitute an abandonment of the grievance. Failure of the City to respond within the time limit at any step shall result in an automatic advancement of the grievance to the next step.

Article 11. Union Security

A. Union Dues Check-Off Deductions

1. In accordance with the provisions of this Article, the City shall make payroll deductions from the pay of employees who authorize such deductions in writing on a form provided and/or approved by the City. Such deductions shall be made in accordance with rules and regulations established by the City and the provisions of this Article. Deductions shall be in a pay period basis and shall be made payable to the Union. The Union, as the formally recognized employee organization, may designate the Hollister Municipal Employees Association as the payee of the dues check-off check from the City and to receive the check on behalf of the Union by providing specific written authorization to the City Finance Director. In lieu of such written authorization the dues check-off check shall be forwarded directly to the Union.

2. All other legal and required payroll deductions shall have priority over dues check-off deductions. The employee's earnings must be sufficient after other legal and required deductions are made to cover the amount of the dues check-off authorized. When an employee is in a non- pay status for an entire pay period, no withholding will be made to cover that pay period from future earnings nor will the employee be required to deposit the amount of deductions with the City which would have been withheld if the employee had been in a pay status during the pay period. In the case of an employee who is in a non-pay status during only a part of the pay period and the salary is not sufficient to cover the full withholding, no deduction shall be made.

B. Maintenance Of Membership

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This section shall be applicable to employees hired by the City on or before November 15, 1995.

Membership in the Union shall not be compulsory. An affected employee has the right to choose either to become a Union member or to refrain from becoming a Union member. All affected employees who have authorized payroll deductions for payment of Union dues prior to the effective date of this M.O.U. (by reaffirming such deductions by voluntarily completing a re-commit card), and all affected employees who establish dues payroll deductions during the term of this M.O.U., shall remain members of the Union (with understanding that the authorization of deduction dues shall renew each year on the anniversary of the date the employee’s signed re-commit card), provided that Union members on payroll deduction may end their authorization for deduction of Union dues by mailing (by certified mail) a signed resignation letter to SEIU Local 521’s central office, postmarked between 75 days and 45 days before such annual renewal date. This authorization is voluntary and is not a condition of the employee’s employment.

The Union shall keep an itemized record of its financial transactions and shall provide the City, and any requesting employee, with a detailed written financial report thereof in the form of a balance sheet and an operating statement, certified as to accuracy by the Union president and treasurer (or corresponding principal officer) or certified public accountant. Such report(s) shall be provided to the City prior to March 1st of each year. If the Union fails to provide the required written financial report(s), the City shall suspend dues check-off deductions for each pay period the report(s) is unavailable.

C. Union Indemnification, Hold Harmless, and Defense

1. The Union agrees to indemnify, hold harmless, and defend the City and its officers, employees, and agents against all claims, proceedings, actions, and liability arising, directly or indirectly out of any actions taken or not taken by or on behalf of the City pursuant to any claims made and against any suits instituted against the City on account of the City's implementation and enforcement of Section A. Union Dues Check-Off Deduction, and Section B. Maintenance Of Membership of this Article.

Article 12. Miscellaneous
A. Deferred Compensation Plan

The City shall continue to provide a voluntary Deferred Compensation Plan for all employees of this unit for the term of this M.O.U.

B. Tool Replacement Allowance

1. The City shall provide a tool replacement fund for the replacement of worn out or broken shop tools and the purchase of new shop tools as needed. This allowance will be available to those employees in classifications which are required as a condition of employment to provide their own shop tools for the performance of their duties within City service. The utilization of this fund shall not exceed five hundred dollars ($500.00) per employee for any fiscal year. All shop tools purchased and reimbursed under this provision shall be maintained by the employee so as to be immediately available for City work. This fund is meant as to have funds available for reimbursement not automatic payment to the employee.

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2. The employee shall acquire the tool(s) and shall present documentary evidence (receipts and invoices, etc.) of the acquisition and ownership to the City for reimbursement. The Department Head or his designee may inspect and inventory all tools acquired under this provision.

C. Working Out of Classification Assignment

Unit employees assigned by management on a Personnel Action Form (P.A.F.) shall be compensated within the salary range for which the assignment is made, but in no case less than five percent (5%) subject to the following:

1. The position must be vacant and budgeted.

2. Must be assigned by Management.

3. The grievance procedure shall not be utilized by unit members in any conflict and Management's assignment or non-assignment is final a binding upon all parties.

D. Sick Leave Conversion To Cash

Eligible unit employees may convert a percentage of accrued, unused sick leave to cash at death or retirement from City employment. The provisions for this policy are as follows:

1. Employees of this unit may not "cash out" or be compensated for any of the first 240 hours of sick leave accrued.

2. Any current employee of this unit having completed 10 years of continuous service with the City and who retires from City service by filing for Service Retirement with CalPERS, will be compensated for fifty-percent (50%) of accrued, unused sick leave in excess of 240 hours at the employee's hourly rate of pay at the time of retirement from City service.

3. The surviving spouse, beneficiary(s), dependents), or estate of any current employee of this unit who has completed 10 years of continuous service with the City and dies while employed by the City prior to retirement, will be compensated for one hundred percent (100%) of accrued, unused sick leave in excess of 240 hours at the employee's hourly rate of pay at the time of death.

4. Any current employee of this unit having completed 10 years of continuous service with the City and having an unused sick leave accrual balance exceeding 500 hours may, at their option, "cash out" up to a maximum of 96 hours (12 days) of unused sick leave annually as long as the "cashed out" hours do not diminish the unused sick leave accrual balance to an amount less than 500 hours.

5. Compensation for unused, accrued sick leave will be made at the employee's rate of pay at the time of "cash out". Requests for payment of unused sick leave as described herein, shall be made in writing to the Administrative Services Department at least 30 days in advance of June 1st and December 1st of each year.

6. Payments of "cashed out" unused sick leave will be made on the first pay day which follows June 1st and December 1st of each year.

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E. Vacation Leave

Vacation leave accrual for each represented unit member shall be as follows:

Years of Service Annual Vacation Accrual
1st through completion of 3rd 10 days
4th through completion of 7th 15 days
8th through completion of 15th 20 days
16th through completion of 20th 22 days
Beginning of 21st year 25 days

Employees may cash out up to a maximum of forty (40) hours of vacation leave annually.

Compensation for vacation leave cashed out will be made at the employee’s rate of pay at the time of cash out. Request for payment of vacation time shall be made in writing to the Department of Administrative Services at least thirty (30) days in advance of June 1st and December 1st of each year.

Payments of cashed-out vacation leave will be made on the first pay day which follows June 1st and December 1st of each year. This payment will be made in the regular payroll check issued for that pay period.

F. Flexible Work Schedule
Eligible unit members may work flexible work schedules (i.e. 4/10, 9/80) when feasible. It is not the intention of the City to reduce the number of hours that City services are available to the public. It is agreed that implementation of flexible work schedules shall be evaluated on a work unit basis, and will only be approved in those units where flexible work schedules can be implemented without reducing service levels and cost effectiveness.

G. Union Representatives Time Off

1. City shall grant Union employee board an aggregate of sixty (60) hours of paid time off from work per fiscal year for the purpose of attending Union sponsored educational and training opportunities as shown below:

a. Executive Board Meetings
b. Advisory Board Meetings
c. Bargaining Team Training
d. Steward Training
e. Budget Training

2. It is agreed that the employee representatives shall provide sufficient notice to their supervisors so that work schedules can be arranged to compensate for their absence.

3. The City will grant time off for "Meet and Confer" preparation and negotiations, for a time period not to exceed one hour before the respective negotiation session and one-half hour following the conclusion of same negotiation session.

4. Unless modified by mutual agreement at the onset of negotiations, time off in addition to that provided in G(3.) for any other "Meet and Confer" preparation shall be taken as leave in A.22.a
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accordance with the City's established leave procedures and with sufficient notice to Supervisors to ensure appropriate coverage of operations.

H. Advance Notice
Except in cases of emergency as provided in Government Code § 3504.5, the City will provide 30 days written notice to the Union of any ordinance, rule, resolution, or regulation directly related to matters within the scope of representation proposed to be adopted by the City and shall give the Union the opportunity to meet with the City. As provided by Government Code § 3504, "scope of representation" as used in this section shall include all matters relating to employment conditions and employer- employee relations, including, but not limited to, wages, hours, and other terms and conditions of employment, except, however, that the scope of representation shall not include consideration of the merits, necessity, or organization of any service or activity provided by law or executive order. In cases of emergency when the City determines that an ordinance, rule, resolution, or regulation must be adopted immediately without prior notice or meeting with the Union, the City shall provide notice and opportunity to meet at the earliest practicable time following the adoption of the ordinance, rule, resolution, or regulation.

I. Joint Labor-Management Committee
At the request of either party, the parties agree to convene a joint labor-management committee for the purpose of communication, information sharing, and problem solving on relevant issues.

J. Professional Development Incentive Program
Employees who have successfully completed probation shall be eligible to receive a one-time professional development incentive for obtaining certificates or degrees received after the date of this M.O.U. A professional development incentive shall not be awarded if the certification or degree is a minimum requirement for their position.

The certificate must relate to the employee's current position or future lateral or promotional opportunities with the General Employees Unit, Mid-Management Association or the unrepresented units of Confidential Employees and Executive Management. Vocational Training, for purposes of this section, is defined as a minimum of 20 hours of specific training in a career field which results in a certificate of completion. The minimum twenty (20) hours shall be documented classroom time or in the case of a correspondence program identified as the average length of time required to complete the program certification as documented by the certifying agency or institution. Only one (1) professional development incentive per fiscal year can be received by an employee. If an employee receives a Ph.D., Master's degree or Bachelor's degree in a fiscal year, the employee may also receive one (1) additional professional development incentive for a certificate earned in the same fiscal year. Additionally, any additional development incentives earned in the same fiscal year do not rollover to the subsequent fiscal year.

1. Professional Certificates - $2,500.00 Lump Sum:
- Professional Engineer Registration
- Professional Land Surveyor Registration
- Certified Public Accountant
- Engineer-In-Training
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- Land Surveyor-In-Training
- American Institute of Certified Planners
- Paralegal Certificate
- Grade 5 Water Treatment Operator or Water Distribution Operator - Grade 5 Waste Water Treatment Operator
- QSP
- QSD

2. College Degrees and Certificates - $2,500.00 Lump Sum - Ph.D.
- Master's Degree
- Bachelor's Degree
- Associate's Degree

3. Technical Certificates - $2,000.00 Lump Sum:

- Grade 4 Water Treatment Operator or Water Distribution Operator - Grade 3 Water Treatment Operator or Water Distribution Operator - Grade 2 Water Treatment Operator or Water Distribution Operator - Grade 1 Water Treatment Operator or Water Distribution Operator - Grade 4 Waste Water Treatment Operator
- Grade 3 Waste Water Treatment Operator
- Grade 2 Waste Water Treatment Operator
- Grade 1 Waste Water Treatment Operator
- I.C.B.O. Certificates
- Public Works Inspector - NICET
- Cross Connection Control Specialist Certification
- Certified Arborist
- Certified Pool Operator
- Collections Systems Maintenance
- Certified Storm Water Inspector

4. Vocational Certificates of Completion:

Examples:

- A(+) Certification (Computer Hardware, Software & Networking) - Microsoft Certified Systems Engineer
- Cisco Certified Network Associates
- Operation of Wastewater Treatment Plants Program administered by California State University, Sacramento Regional and Continuing Education Program - Title 29 CFR 1910.120(q) - 24 Hour Hazardous Materials (Hazmat) Technician Level III Certification

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The amount of the incentive for any Vocational Certificate of Completion shall be based on the following number of hours of course work:

Minimum Hours
For Vocational Certificate

Amount

100 $ 1,500.00
80 $ 1,200.00
60 $ 900.00
40 $ 600.00
20 $ 300.00

5. Technical Certificates - $1,000.00 Lump Sum:
- Chemical Applicator
- Licensed Tree Trimmer
- Automotive Service Technician (A.S.E.)

6. Additional Eligibility Criteria

Additional licenses and certificates eligible for these professional development incentives, not listed in this Article, may be reviewed and approved by the Department Head in accordance with the following criteria:

- The license or certificate submitted for consideration must directly relate to the employee's current position or future lateral or promotional opportunities in accordance with the provisions of this section J.
- The employee earning the license or certificate shall be subject to duties and assignments commensurate with the level of proficiency attained under the City's Professional Development Incentive Program.
- After the effective date of this M.O.U., all such requests for consideration for eligibility for such license and certificate incentives shall be submitted to the Department Head for review, with final approval by the City Manager at his/her sole discretion. The City Manager's determination is not subject to appeal.

The process for receiving a professional development incentive under this program shall be:
- Prior to beginning any class, program, seminar or study toward a desired certificate or degree, the employee must submit a request to his/her department head for consideration and approval of bonus award. Qualifying classes, programs, seminars or study toward a desired certificate or degree shall not be denied. - If prior approval is not obtained, the class, program, seminar or study toward a desired certificate or degree shall not fall within the scope of this Professional Development Incentive Program.

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- Upon obtaining a copy of the certificate or degree, payment will be processed for the specified incentive. Professional development incentives shall not be granted prior to receiving a copy of the degree or certificate.

- The following are not eligible for consideration under this Section:

- Any driver's licenses

- Certificates, licenses, or degrees required for the position the employee holds

- Certificates, licenses, or degrees earned at the expense of the City including City sponsored training programs and consortium training programs except for approved tuition reimbursement pursuant to Section 8.10 (D) and (E) of the City of Hollister Personnel Rules & Regulations for Associate degrees, Bachelor's degrees, Master's degrees, and Ph.D. degrees.

K. Flexibly Staffed Entry Level Positions

The City shall advance employees that are in the entry level of flexibly staffed classifications (i.e.

Maintenance Worker I, Support Services Assistant I, to a II, and to Senior, Account Technician I to II) to the journey level after meeting the experience requirements for the journey level classification, successfully passing a probationary period in the entry level classification and being given a satisfactory performance evaluation.

L. Length of Probationary Period for All Unit Members

1. Newly Hired Employees

Newly hired employees shall serve a mandatory one (1) year probationary period.

2. Promotional Appointments

Permanent employees whom are promoted shall serve a mandatory six (6) month probationary period. All existing employees that are subject to a probationary period as part of a promotion shall be returned to that employee's previous classification if the employee fails to meet the job requirements of the new classification within the probationary period.

M. Reclassification and Salary Adjustment Policy

The City and Union agree to develop a structured process for addressing individual reclassifications and resulting salary adjustments that will be consistent with the annual budget process.

City to address reclassification and salary adjustments consistent with this section of the MOU specifically for staff working in the Utilities, Recreation, and Fleet divisions no later than February 2024.

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N. Christmas Eve

The City shall provide an additional paid half (1 ½) day holiday on the afternoon (4 hours) of December 24th, known as Christmas Eve. The Christmas Eve holiday shall be observed on the afternoon of the workday proceeding the day on which the December 25th holiday, known as Christmas Day, is observed.

O. Layoff and Reduction in Time Procedures

In those instances, where the City may have to lay off or reduce the work hours of bargaining unit members due to lack of work or lack of funds, the following order of layoff/ reduction shall be used:

1. Temporary/ seasonal workers

2. Workers on probation

3. Career, regular employees

In the event that a career employee is laid off, the following criteria shall be used:

1. Layoff by seniority, in the classification and department determined to be eliminated.

2. A laid off employee has the right to "bump" or displace the most junior worker in the classification, providing the laid off worker is qualified to fill the position.

P. Automatic Payroll Deposit

All new unit members of the Union shall enroll in the automatic payroll deposit program at the time of their employment with the City or at the time of promotion to this unit.

Q. Tuition Reimbursements

The city will reimburse Union members up to Thirty-Five Hundred dollars ($3,500.00) four thousand five hundred dollars ($4,500.00) per fiscal year for tuition reimbursements in accordance to the rules set forth in the City’s Personnel Rules and Regulations.

R. Dignity and Professionalism

The City is committed to providing a workplace where all persons employed by the City of Hollister, regardless of their classification or pay status are treated with dignity, respect and in a professional manner. We shall treat one another in the ways we want to be treated ourselves, including clear communications of expectations regarding performance, support of individual opportunities for growth, and provide opportunities for input into decisions when they impact bargaining unit employees directly.

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S. New Employee Orientation

The Union will be given thirty (30) minutes at the end of the orientation to present Union information to bargaining unit employees.

T. Timely Notification

When an employee discontinues paying membership dues, the Union should notify the City within 30 days.

U. Step Increases

Failure of an appointing authority to recommend a salary step advancement in accordance with the performance evaluation procedure shall be considered to be a recommendation of a salary step advancement effective on the anniversary date. Timeliness of evaluations is not subject to the grievance procedure.

Article 13. Holidays

1. Holiday Schedule

The City provides the following paid holidays:

1. All members are entitled to 12.50 paid holidays per year. Each paid holiday is the equivalent to 8.00 hours unless otherwise noted. The 12.50 paid holidays in the schedule below are the equivalent to 100.00 hours. The holidays are as follows:

New Year’s Day January 1
Martin Luther King, Jr. Third Monday in January
President’s Day Third Monday in February
Cesar Chavez Day March 31
Memorial Day Last Monday in May
Juneteenth June 19
Independence Day July 4th
Labor Day First Monday in September
Veteran’s Day November 11
Thanksgiving Day Fourth Thursday in November
Friday after Thanksgiving Day after Thanksgiving
Christmas Eve – Half Day December 24
Christmas Day December 25
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In addition, each employee is entitled to two (2) floating holidays per fiscal year. Each floating holiday is the equivalent to 8.00 hours.

If one of the holiday listed above falls on a Sunday, then it shall be observed on the following Monday. If one of the holidays listed above falls on a Saturday, then it shall be observed on the previous Friday.

2. Holiday Office Closure

For the term of this contract, employees shall be paid for the following closure days for

 December 27, 28, 29, 30, 2021, a total of thirty-two 32 hours, four (4) days  December 27, 28, 29, 30, 2022, a total of thirty-two 32 hours, four (4) days

This shall be in addition to the paid holidays of Christmas and New Year’s Day.

The Holiday Office Closure will apply to full and part-time City Employees. Department heads will assess their operations to determine the extent to which they will participate in total or partial closure of office to the public during the specified period. Those departments for which it is impractical to consider closure for the days listed below will establish alternate days for employees to use the required Holiday Office Closure hours.

The City Manager may elect to close certain City offices to the public between the Christmas and New Year’s Day holidays. However, it will also be necessary to have a base level of staffing to open and operate certain offices during core business hours. Not all departments will be impacted as some public services must be provided on a continual basis.

To accommodate these needs, the City will provide all unit members a bank of thirty- two (32) HOLIDAY CLOSURE HOURS. An employee will have the option, with Department Head approval, to use HOLIDAY CLOSURE HOURS at any point between November 1 – December 31. There are no exceptions to these dates.

HOLIDAY CLOSURE HOURS cannot be cashed-out and carry no cash value. Unused hours will be forfeited.

It is the employee’s responsibility to ensure that required hours are taken off work prior to the end of each applicable fiscal year. Management will make every effort to accommodate employees’ requests for the equivalent hours of time off. No Employee shall lose the floating holiday time as a result of a denied time-off request.

The Holiday Office Closure is neither grievable nor appealable. However, employees who believe that the Holiday Officer Closure has not been administered according to the provisions of this agreement, including not being granted the time off, may request a review by an advisory committee composed of one (1) union representative and one (1) City Management representative
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3. Juneteenth National Independence Day

Juneteenth National Independence Day was recognized as a federal holiday on June 17, 2021 when the president signed the Juneteenth National Independence Day Act into law. The City shall provide an additional paid holiday on June 19th of each year upon execution of this contract.

Article 14. Maintenance of Operations

The Union agrees that during the term of this M.O.U. neither the Union, nor any representative acting on its behalf, will cause, authorize, engage in, condone or sanction a strike, sick -in, work stoppage, slow down, picketing (other than informational picketing on the employees' own time), concerted or individual failure to report for duty, unauthorized absence, including compliance with a request of another unit's labor organization to engage in or honor such activities against the City, or any activity by any other euphemism known which results in less than the full and faithful performance of any duties of employment.

If the City determines that an employee has engaged in any activity above, the employee may be subject to disciplinary action up to and including discharge from City service.

Article 15. Prevailing M.O.U.

In the event of a conflict between a specific provision of this M.O.U. and a written rule, regulation, or resolution of the City or any of its divisions, the terms of the M.O.U. shall prevail and said written rule, regulation, or resolution shall be physically amended to conform to the specific provisions of this M.O.U.

Article 16. Drug Free Workplace Policy

The City's Drug Free Workplace Policy, City Personnel Rule 2.05, adopted by Resolution 92-116 (August 3, 1992), is incorporated by reference into this M.O.U.

Article 17. Savings Clause

If any article or section of this M.O.U. should be found invalid, unlawful or unenforceable by reason of any existing or subsequent enacted legislation or by judicial authority, all other articles and sections of this M.O.U. shall remain in full force and effect for the duration of this M.O.U. In the event of invalidation of any article or section, the City and the Union agree to meet within thirty (30) days for the purpose of meeting and conferring upon said article or section.

Article 18. Term of Agreement

The term of this M.O.U. shall commence on July 31, 2021 and shall expire June 30, 2023, unless otherwise agreed to by both parties. It is also agreed to by both parties to initiate the meet and confer process in a timely fashion, exchanging written proposals at least thirty (30) days prior to the termination of this agreement. An extension of the term of this agreement on a month to month basis may be made my mutual agreement of the parties.

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The above constitutes a full and complete agreement between the parties on all matters within the scope of representation.

CITY OF HOLLISTER SEIU LOCAL 521

Dated ____________________________ Dated ____________________________

By _______________________________ By _______________________________ Brett I. Miller, City Manager Ambur Cameron, President

By _______________________________ By _______________________________ Linzie L. Daniel, Lead City Negotiator Jorge Torres, Bargaining Team Member

By _______________________________ By _______________________________ Diana Hillstock, City Negotiator Isaiah Hernandez, Bargaining Team Member

By _______________________________
Miesha Brown, SEIU Negotiator

CITY OF HOLLISTER SEIU LOCAL 521

David Mirrione, Interim City Manager Art Hernandez, SEIU Bargaining Team

Casey Estorga, Admin Services Director Leonard Martinez, SEIU Bargaining Team

Mary Lerner, City Attorney Trenna Burbank, SEIU Bargaining Team

Jay Donato, SEIU Lead Negotiator

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EXHIBIT [A]

SECTION 12. DISCIPLINARY PROCEDURE

Section 12.01 General

A. The expected standard for employees of the City shall be to render the best possible service to the public, to reflect credit upon the City service, and to serve the public interest. The tenure of every employee shall be conditioned on good behavior and satisfactory performance of duties.

Disciplinary actions are intended to be corrective and progressive in nature with the objective of obtaining compliance with rules, orders, procedures, standards of conduct and expected job performance.

B. The procedures set forth in this section shall not apply to probationary employees who are rejected during probation, or to any employee serving in a seasonal or temporary appointment. These procedures shall not apply to a reduction in force, or a reduction in pay which is part of a reclassification action or reorganization approved by the City Council.

C. The City Manager may take disciplinary action based upon a Department Head recommendation or initiate such action based upon his/her own authority. The City Manager may delegate the responsibility to take disciplinary action to Departments Head(s). As used in this section, "disciplining authority" shall mean either a Department Head or the City Manager, whoever initiates the disciplinary action; "working day" shall mean any day of the month when the City offices are officially open for business.

D. The procedures set forth in this section shall not preclude an employee from entering into a written agreement with the City to settle a pending disciplinary matter, and further shall not preclude an employee from waiving any of the notice provisions herein provided for, as part of that written settlement agreement.

Section 12.02 Grounds for Discipline

An employee may be reprimanded, suspended, denied a merit increase, demoted or dismissed for any of the following reasons:

1. Furnishing false information to secure employment.

2. Incompetence, which shall mean that the employee lacks adequate ability, knowledge, motivation, or fitness to satisfactorily perform the duties which are within the scope of employment.

3. Inefficiency in performance of work which results in performance lower than that which is A.22.a
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typically expected of the position.

4. Neglect of duty.

5. Insubordination, which shall mean refusal or failure to follow a direct, lawful order which the

employee is capable of following.

6. Nonobservance of work hours.

7. Excessive absenteeism, tardiness, or absence without authorized leave.

8. Violation of city personnel rules and regulations, administrative policies and procedures, department rules and regulations, safety rules, resolutions, ordinances or codes.

9. Damage to or waste of public property, equipment or supplies, or unauthorized possession or use of public property, supplies or equipment.

10. Any conduct related to employment which impairs, disrupts or causes discredit to the employee's department or the city, including but not limited to conduct which is or would be cause for discipline under any other provisions of this section.

11. Willful failure or refusal to property perform official duty.

12. Gross negligence in the discharge of official duty.

13. Dishonesty involving employment.

14. Any act of moral turpitude which adversely reflects on the employee's ability or fitness to perform his/her duties.

15. Soliciting or taking for personal use a fee, gift or other valuable thing in the course of the employee's work, or in connection with the contributing party's expectation or hope of receiving favorable or better treatment than that afforded other persons.

16. Disclosure of confidential information to an unauthorized source.

17. Refusal to take and subscribe to any oath or affirmation which is required by law in connection with employment by the city.

18. Falsification of time sheets or any official city records.

19. Misuse of sick leave.

20. Consuming, possessing, or being under the influence of an alcoholic beverage, while on duty.

21. Unless legally authorized, using, consuming, injecting, possessing, being under the influence A.22.a
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of, selling or offering for sale, while on duty, any drug which can or does impair, the employee's work performance, or any controlled substance as the latter term is defined in the California Health and Safety code.

22. Discourteous or disrespectful treatment of the public, other employees, or city officials.

23. Violation of city harassment policy.

24. Persistent failure or refusal to take, complete, or follow through with appropriate and reasonable treatment or corrective measures designed to remedy an employee's condition, such as alcohol or substance abuse, when said condition results in conduct which constitutes grounds for discipline under these rules.

25. Engaging in outside employment in violation of city policies or rules.

26. Engaging in non-City business during work hours, excluding employee free time such as lunch and breaks.

Section 12.03 Types of Disciplinary Action

As used in this section, "disciplinary action" shall mean any of the following and may be taken singly or in combination:

A. Counseling or Oral Warning. A counseling or oral warning will not be placed in an employee's personnel file except as part of a regular or special performance evaluation report of the employee on which the employee is given an opportunity to respond. A counseling or oral warning or a performance evaluation report is not subject to the appeal process outlined below.

B. Written Reprimand. A written reprimand shall be provided to an employee prior to being placed in the employee's personnel file. Such reprimands shall not be subject to the appeal process outlined below, but the employee shall have the right of rebuttal by providing a written statement which will be included in the personnel file along with the written reprimand.

C. Imposition of special employment conditions. Such action shall be subject to the appeal process outlined below.

D. Suspension with or without pay. Fringe benefits such as vacation and sick leave shall not accrue during a period of suspension without pay. However, health, dental and life insurance shall remain in effect during a period of suspension without pay. Such action shall be subject to the appeal process outlined below.

E. Reduction in pay level not to exceed one (1) year. Such action shall be subject to the appeal process outlined below.

F. Demotion. Such action shall be subject to the appeal process outlined below.

G. Dismissal or Discharge. Such action shall be subject to the appeal process outlined below.

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Section 12.04 Notice of Intended Disciplinary Action

A. In cases of proposed disciplinary action, except a counseling, oral warning, or written reprimand, the proposed disciplinary action shall be served on the employee personally or by mail. The written

notice of intended disciplinary action which shall include:

1. The reasons for the disciplinary action, those facts alleged to be the basis for the intended action and copies of any documents or materials upon which the disciplinary action is based;

2. The specific action proposed to be taken, including any time period or other conditions associated with the discipline;

3. The proposed effective date of the intended disciplinary action; and

4. The right of the employee to respond to the proposed disciplinary action either in writing or orally, at the option of the employee. The employee shall be advised that he/she has ten (10) working days within which to file a written response or request, in writing, an informal pre- disciplinary conference before the disciplining authority or his/her designee.

B. A copy of the notice of intended disciplinary action shall be placed in the employee's personnel file.

Section 12.05 Pre-disciplinary Conference

Where an employee has requested an opportunity to respond orally, the disciplining authority or his/her designee shall cause an informal pre-disciplinary conference to be held to review the statement of charges and to provide the opportunity for the employee or his/her representative to answer the charges. The disciplining authority or his/her designee shall allow the parties to present any relevant evidence tending to prove or disprove the facts upon which the action is based or upon the nature and severity of the proposed disciplinary action. Failure of the employee to appear at the pre-disciplinary conference, if requested, shall forfeit all the employee's right to respond to the statement of charges.

Section 12.06 Notice of Discipline or Rejection of Discipline

A. If the employee does not respond or upon conclusion of the pre-disciplinary conference, the disciplining authority or his/her designee shall, by written notice to the employee and the supervisor, affirm, reduce or abandon the proposed disciplinary action.

B. If the decision is to affirm or reduce the proposed disciplinary action, such action shall be served on the employee personally or by mail. The written notice of disciplinary action shall include:

1. The reasons for the disciplinary action, those facts alleged to be the basis for the disciplinary action and copies of any documents or materials upon which the disciplinary action is based;

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associated with the discipline;

3. The effective date of the disciplinary action; and

4. The right of the employee to appeal the disciplinary action. The employee shall be advised that he/she has ten (10) working days within which to file a written appeal of the disciplinary action.

C. A copy of the notice of disciplinary action shall be placed in the employee's personnel file.

D. If the notice is to abandon all action, the notice of intended disciplinary action shall be removed from all personnel files.

Section 12.07 Appeal of Disciplinary Action

Failure to file within the time allowed constitutes abandonment of appeal rights. The evidentiary appeal shall be heard by a hearing officer who will serve as the City Manager’s designee.

Section 12.08 Appeal

A. The Personnel Officer shall be responsible for obtaining the hearing officer from JAMS (Judicial Arbitration and Mediation Services of California). The Personnel Officer shall ask JAMS to randomly provide the name of one retired judge who shall be impartial and who shall conduct the hearing on behalf of the City Manager. The City shall pay for the services of the hearing officer.

B. The Hearing Officer shall assume responsibility for scheduling and conducting the hearing in accordance with the provisions of Chapter 12. The hearing officer shall conduct the hearing and prepare a report that includes findings of fact and recommendation(s). The City Manager shall be bound by the findings of fact but reserves final authority on the recommendation(s) of the Hearing Officer. The decision of the City Manager shall be final unless appealed to the City Council.

C. If the decision is to affirm or modify the disciplinary action, the decision shall be placed in the employee’s personnel file. If the decision is to modify or reverse the disciplinary action, that action shall be implemented. If reversed, the notice of the intended disciplinary action and the notice of disciplinary action shall be removed from the employee’s personnel file.

Section 12.09 Evidentiary Appeal Hearing Procedure

A. The Hearing Officer shall provide the appellant and City with written notice of the date, time, and place of the hearing no less than ten (10) working days in advance of the scheduled hearing date.

Any time lines contained in this section may be extended upon mutual agreement of the City and the appellant for good cause.

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B. The hearing shall be conducted in conformity with Sections 11512 through 11515, inclusive, of the Government Code. The hearing officer shall be deemed to be the administrative law judge in the proceeding.

C. The hearing shall be closed to the public unless the appellant, prior to the commencement of the hearing, requests in writing that it be open to the public. The hearing shall be conducted in accordance with the provisions of Section 11513 of the Government Code which reads:

1. Oral evidence shall be taken only on oath or affirmation.

2. Each party shall have these rights: to call and examine witnesses; to introduce exhibits; to cross- examine opposing witnesses on any matter relevant to the issues even though that matter was not covered in the direct examination; to impeach any witness regardless of which party first called him or her to testify; and to rebut the evidence against him or her. If the appellant does not testify on appellant’s own behalf, s/he may be called and examined as if under cross- examination.

3. The hearing need not be conducted according to technical rules relating to evidence and witnesses. Any relevant evidence shall be admitted if it is the sort of evidence on which responsible persons are accustomed to rely in the conduct of serious affairs, regardless of the existence of any common law or statutory rule which might make improper the admission of such evidence over objection in civil actions. Hearsay evidence may be used for the purpose of supplementing or explaining other evidence but shall not be sufficient in itself to support a finding unless it would be admissible over objection in a civil action. The rules of privilege shall be effective to the extent that they are otherwise required by statute to be recognized at the hearing, and irrelevant and unduly repetitious evidence shall be excluded.

D. The appellant may be examined and may examine or cause any person to be examined under Section 776 of the Evidence Code. The appellant shall be allowed to appear personally at the hearing, and appellant shall have the right to legal counsel or lay representation of appellant’s choice and sole expense at all times throughout the proceeding, and appellant shall be allowed to produce such competent evidence in his/her own defense and in rebuttal to the charges as the appellant or appellant’s/her representative may wish to offer.

E. The hearing shall be recorded by a stenographic reporter. If any transcript is ordered by the appellant or the City, the party ordering the transcript shall bear the cost of the transcription. If both the appellant and the City order transcriptions, the cost of the transcription, along with the cost of the reporter, shall be borne equally by the City and the appellant.

F. The Hearing Officer shall have the power to subpoena and require the attendance of witnesses, and the production of books, papers, and other evidence pertinent to the hearing, and to administer oaths to witnesses. In arriving at a recommendation, the hearing officer may consider any prior disciplinary actions taken against the appellant, or any prior proceedings under this section.

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G. Unless the circumstances were beyond the control of the appellant, failure of the appellant to appear at the hearing shall be deemed a withdrawal of the appeal and the action of the department head in the notice of disciplinary action shall be final without right of appeal to the City Council.

The participation of the appellant’s representative at the hearing shall constitute appearance of the appellant.

H. The City Manager shall review the hearing officer’s report including the findings of fact and recommendation(s) and within thirty (30) days from the hearing officer’s report issue his or her written decision affirming, reversing, or modifying the discipline which shall be final unless appealed to the City Council.

I. An employee can appeal the City Manager’s decision to the City Council by filing the written notice of appeal with the City Clerk within ten (10) working days from the date of the mailing of the City Manager’s decision.

J. Within ten (10) days after receipt of the appeal, the City Clerk shall give notice of the appeal to each member of the City Council, the City Manager, and other persons named or affected by the appeal and shall schedule a hearing before the City Council.

K. The hearing before the City Council shall be non-evidentiary in nature and shall be limited to oral arguments from both parties or their representatives. The City Council shall be bound by the findings of fact prepared by the hearing officer. Appellant and City shall each have 20 minutes of oral argument with an additional 5 minutes of rebuttal argument. The hearing before the City Council shall be closed to the public unless prior to the hearing the appellant requests in writing that the hearing be open to the public.

L. The City Council shall deliberate in closed session and shall issue a decision which affirms, reverses, or modifies the discipline imposed by the City Manager.

M. If the Council’s decision is to affirm or modify the disciplinary action, the decision shall be placed in the employee’s personnel file. If the decision is to modify or reverse the disciplinary action, that action shall be implemented. If reversed, the notice of the intended disciplinary action and the notice of disciplinary action shall be removed from the employee’s personnel file.

N. The decision of the City Council shall be final and subject to judicial review under Code of Civil Procedure 1094.5.

Section 12.10 Serving of Notices

Written notices shall be served either by direct personal service on the person affected, or by mail.

Mailed notices to the City Manager or his/her designee, a Department Head, an appellant and/or his/her designee, or the City Council shall be effective upon recorded deposit with the United States Postal Service.

Section 12.11 Summary Suspension

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in cases where the employee's continued active duty status might, in the sole opinion of the City Manager, constitute a hazard to the employee or others, tend to bring the City service into discredit, or prolong acts or omissions of improper employee conduct. If the disciplinary action or suspension is not subsequently ordered and/or affirmed, the employee shall be reinstated in status and restored all pay and fringe benefits lost during such summary suspension.

Section 12.12 Right to Representation

An employee subject to a meeting, an investigation that may result in disciplinary action, a pre - disciplinary conference or hearing has the right, upon request, to be represented by an employee representative or an attorney retained by the employee at the employee's expense. Any employee, other than those defined as management, mid-management and confidential employees shall be permitted to represent another City employee or group of City employees.

Section 12.13 Records Purged

An employee's personnel file shall be purged of all documents relating to ordered disciplinary actions, except dismissal, after three (3) years from the end of such action upon the written request of the employee or former employee against whom the action was taken. (Updated 08-06-21: dh)

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STAFF REPORT

CITY COUNCIL REGULAR MEETING AGENDA
MEETING DATE: JUNE 20, 2023
SUBMITTED: June 15, 2023
DEPARTMENT:

DEPARTMENT HEAD:

Administrative Services
Casey Estorga, Administrative
Services Director

TITLE OF ITEM: RESOLUTION NO. 2023-131, A RESOLUTION OF THE CITY COUNCIL OF

THE CITY OF HOLLISTER APPROVING A MEMORANDUM OF UNDERSTANDING

BETWEEN THE CITY OF HOLLISTER AND THE HOLLISTER CONFIDENTIAL UNIT

BRIEF DESCRIPTION: The Memorandum of Understanding (MOU) between the City of Hollister and the Confidential Unit is scheduled to expire on June 30, 2023. As a result, the City and members from Confidential Unit have met and conferred in good faith over the past several months to discuss changes to the MOU, which will be considered by Council.

RECOMMENDATION: Authorize the Interim City Manager to execute the amended MOU between the City of Hollister and the Confidential Unit.

DISCUSSION: The Memorandum of Understanding (MOU) between the City of Hollister and the Confidential Unit is scheduled to expire on June 30, 2023. As a result, the City and members from Confidential Unit have met and conferred in good faith over the past several months to discuss changes to the MOU.

As a result, the City and the Confidential Unit have agreed to terms amending the MOU, including an amendment to extend the term of the MOU by two years with a new expiration date of June 30, 2025. A full copy of the updated MOU, including strike- through formatting to identify the changes, has been included as part of this staff report.

FINANCIAL IMPACT: Funding for this item has been included in the FY 2023-24 Recommended Budget. Funding for future years will be presented to the City Council as part of the annual budget process.

CEQA: N/A

ATTACHMENTS:

1. Confidential MOU Red Line - 07.01.2023 - 06.30.2025

THIS REPORT WAS REVIEWED BY THE INTERIM CITY MANAGER WHO CONCURS WITH

THE STAFF RECOMMENDATION

David Mirrione, Interim City Manager

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RESOLUTION NO. 2023-131

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HOLLISTER APPROVING A

MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF HOLLISTER AND THE

HOLLISTER CONFIDENTIAL UNIT

WHEREAS, representatives of the City of Hollister and the Confidential Unit, an organization representing City of Hollister employees, have met and conferred in good faith concerning subjects of bargaining; and

WHEREAS, understandings and agreements have been reached between the bargaining representatives; and

WHEREAS, the agreement was ratified by the Confidential Unit members; and

WHEREAS, both parties have agreed to enter into a Memorandum of Understanding for the term of July 1, 2023 through June 30, 2025.

NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Hollister authorizes the execution of the Memorandum of Understanding between the Confidential Unit for the term of July 1, 2023 through June 30, 2025, and the City Manager of the City of Hollister is hereby authorized to execute said Memorandum of Understanding.

PASSED AND ADOPTED, by the City Council of the City of Hollister at a Regular Meeting held this 20th day of June, 2023, by the following vote:

Mia Casey, Mayor
ATTEST:

Jennifer Woodworth, MMC, City Clerk

APPROVED AS TO FORM:

Lozano Smith Attorneys at Law

Mary F. Lerner, City Attorney

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I, JENNIFER WOODWORTH, MMC, City Clerk of the City of Hollister, do hereby certify that the attached Resolution No. 2023-131, is an original Resolution, or true and correct copy of a City Resolution, duly adopted by the Council of the City of Hollister at a regular meeting of said Council held on the 20th day of June, 2023, at which meeting a quorum was present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Hollister this City Council day of June, 2023.

Jennifer Woodworth, MMC

City Clerk of the City of Hollister
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MEMORANDUM OF UNDERSTANDING

between the

City of Hollister

and the

CONFIDENTIAL UNIT

July 1, 2021 – June 30, 2023
July 1, 2023 – June 30, 2025

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TABLE OF CONTENTS

Section 1. PREAMBLE Page 1

Section 2. RECOGNITION Page 1

Section 3. NO ABROGATION OF RIGHTS Page 1

Section 4. SALARY ADJUSTMENTS Page 1

Section 5. EQUITY ADJUSTMENTS Page 2

Section 6. HOLIDAYS Page 2

Section 7. VACATION

A. Entitlement Page 3
B. Accrual Page 3
C. Maximum Accrual Page 3
D. Floating Holidays Page 4
E. Vacation Conversion to Cash Page 4

Section 8. SICK LEAVE

A. Entitlement Page 4
B. Accrual Page 4
C. Sick Leave Conversion to Cash Page 4

Section 9. ADMINISTRATIVE LEAVE Page 5

Section 10. INSURANCE

A. Description Page 6
B. Health Insurance Options Page 6
C. IRS Code Section 125 Flexible Benefits/Cafeteria Plan Page 6 D. Terms of Health Care Participation Page 7
E. Health Care Contributions Page 7
F. Vision Insurance Page 7
G. Dental Insurance Page 8
H. Life Insurance Page 8
I. Long Term Disability Insurance Page 8
J. Health Insurance Waiver Option Page 8
K. Optional Health Benefits Page 9
L. Flexible Spending Accounts Page 9
M. Voluntary Life Insurance Page 9
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N. Miscellaneous Page 10
O. Cost-savings Page 10

Section 11. RETIREMENT

A. Contribution Page 10
B. 1959 PERS Survivor Death Benefit Page 10
C. One-Year Final Compensation Benefit Page 11

Section 12. PROFESSIONAL DEVELOPMENT INCENTIVE PROGRAM

A. Professional Certificates Page 11
B. College Degrees and Certificates Page 12
C. Technical Certificates ($2,000) Page 12
D. Vocational Certificates of Completion Page 12
E. Technical Certificates ($1,000) Page 12
F. Additional Eligibility Requirements Page 13

Section 13. TUITION REIMBURSEMENT Page 14

Section 14. DEFERRED COMPENSATION PROGRAM Page 14

Section 15. BILINGUAL ALLOWANCE Page 14

Section 16. DRUG-FREE WORKPLACE POLICY Page 15

Section 17. MILEAGE REIMBURSEMENT Page 15

Section 18. JURY DUTY AND SUBPOENAED WITNESS Page 15

Section 19. LONGEVITY BONUS PAY Page 15

Section 20. LAND SURVEYOR LICENSE CERTIFICATE Page 15

Section 21. COMPUTER LOAN PROGRAM Page 15

Section 22. NOTARY PUBLIC COMMISSION PAY Page 16

Section 23. ACCOUNTING MANAGER – CERTIFIED PUBLIC
ACCOUNT LICENSE CERTIFICATION PAY Page 16

Section 24. WORKING OUT OF CLASSIFICATION ASSIGNMENT Page 16

Section 25. FLEXIBLE WORK SCHEDULE Page 17
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Section 26. PERSONNEL SYSTEM RULES AND REGULATIONS Page 17

Section 27. STANDBY PAY Page 17

Section 28. EVENT PAY Page 18

Section 29. HUMAN RESOURCES I/II-FLEXIBLY STAFFED Page 18

POSITION

Section 30. TERM OF AGREEMENT Page 18

______________________________________________________________________________

EXHIBITS

EXHIBIT [A] Disciplinary Procedure

Section 12.01 General Page 20
Section 12.02 Grounds for Discipline Page 20
Section 12.03 Types of Disciplinary Action Page 22
Section 12.04 Notice of Intended Disciplinary Action Page 23 Section 12.05 Pre-disciplinary Conference Page 23
Section 12.06 Notice of Discipline or rejection of Discipline Page 23 Section 12.07 Appeal of Disciplinary Action Page 24 Section 12.08 Appeal Page 24
Section 12.09 Evidentiary Appeal Hearing Procedure Page 24 Section 12.10 Serving of Notices Page 26
Section 12.11 Summary Suspension Page 27
Section 12.12 Right to Representation Page 27
Section 12.13 Records Purged Page 27

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1. PREAMBLE

This Memorandum of Understanding is entered into by the City of Hollister, hereinafter referred to as "City", and the Confidential Employees Unit, hereinafter referred to as "Unit".

This Memorandum of Understanding hereinafter referred to as "M.O.U.", is subject to Sections 3500-3510 of the Government Code of the State of California, otherwise known as the Meyers-Milias-Brown Act.

2. RECOGNITION

Pursuant to Section 3500-3510 of the Government Code, the City certifies Unrepresented Unit as the recognized majority representative for all regular career, full-time employees in the Unit. The Unit includes:

 Accountant
 Accounting Manager
 Administrative Analyst
 Deputy City Clerk
 Executive Assistant to the City Manager
 Human Resources Analyst
 Human Resources Technician I
 Human Resources Technician II
 Information System Analyst
 Information Systems Technician
 Legal Administrative Assistant
 Management Analyst
 Payroll Manager
 Senior Support Services Assistant (Confidential)
 Support Services Assistant I/II (Confidential)

3. NO ABROGATION OF RIGHTS

This M.O.U. does not modify any City Council rights.

4. SALARY ADJUSTMENT

a. Effective the first full pay period after June 30, 2021 the City shall apply a two and a half percent (2.5%) across-the-board increase to the base salary of all classifications.

b. Cost of Living Adjustment

A Cost of Living Adjustment (COLA) shall be applied to all unit classifications effective the first full pay period after July 1, 2022. The COLA shall be applied by the following method:

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The COLA shall be determined annually, in April’s Consumer Price Index for All Urban Consumers in the San Francisco-Oakland-San Jose area (CPI-U), using base period 2021- 2022. The ratio is calculated and rounded to the nearest one-half percent (0.5%) with an annual maximum COLA of 3.5%.

Effective the first full pay period after July 1, 2023, the City shall apply a seven percent (7.00%) across-the-board increase to the base salary of all unit classifications.

Effective the first full pay period after July 1, 2024, the City shall apply a six percent (6.00%) across-the-board increase to the base salary of all unit classifications.

5. EQUITY ADJUSTMENTS

During the term of this agreement, both parties agree that upon request of the unit members, to meet and discuss equity adjustments. This does not bind either party to any outcome.

6. HOLIDAYS

1. Holiday Schedule

All Confidential Unit Members are entitled to 11.5 paid holidays per year. These holidays are as follows:

All Confidential Unit members are entitled to 12.5 paid holidays per year. Each paid holiday is the equivalent to 8.00 hours unless otherwise noted. The 12.5 paid holidays in the schedule below are the equivalent to 100.00 hours. The holidays are as follows:

January 1 New Year’s Day
Third Monday in January Martin Luther King Jr. Day
Third Monday in February Presidents Day
March 31 Cesar Chavez Day
Last Monday in May Memorial Day
June 19th Juneteenth National Independence Day
July 4th Independence Day
First Monday in September Labor Day
November 11th Veterans Day
Fourth Thursday in November Thanksgiving Day
Fourth Friday in November Day after Thanksgiving
December 24th (1/2 day) Christmas Eve
December 25th Christmas Day

2. Holiday Office Closure
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For the term of this contract, employees shall be paid for the following closure days for

 December 27, 28, 29, 30, 2021, a total of thirty-two 32 hours, four (4) days  December 27, 28, 29, 30, 2022, a total of thirty-two 32 hours, four (4) days

This shall be in addition to the paid holidays of Christmas and New Year’s Day.

establish alternate days for employees to use the required Holiday Office Closure hours.

To accommodate these needs, the City will provide all unit members with a bank of thirty-two (32) HOLIDAY CLOSURE HOURS. An employee will have the option, with Department Head approval, to use HOLIDAY CLOSURE HOURS at any point between November 1 – December 31. There are no exceptions to these dates. HOLIDAY CLOSURE HOURS cannot be cashed-out and carry no cash value. Unused hours will be forfeited.

3. Juneteenth National Independence Day

Working/ Called in on a Holiday

Any employees represented by this unit who work or called in on a holiday shall receive compensatory time off from duty at a rate equal to the amount of time worked on the holiday A.23.a
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up to eight hours per day worked. If a represented employee is also entitled to an event pay the employee will be allowed to receive both the compensatory time and event pay.

7. VACATION

A. Entitlement

All Confidential unit member employees are entitled to accrue vacation based on B. Accrual below. Employees may take accrued vacation after the completion of six (6) months of service.

B. Accrual

Years of Service Annual Vacation Accrual

1st through completion of 3rd 10 days
4th through completion of 7th 15 days
8th through completion of 15th 20 days
16th through completion of 20th 22 days
Beginning of 21st year 25 days

C. Maximum Accrual

Confidential unit members may only accumulate a maximum of thirty- five (35) working

days (280 hours) of vacation without the authorization of the City Manager. Accumulated vacation time of more than thirty-five days (280 hours) requires prior written authorization by the City Manager and must be used prior to the end of the calendar year or it will be lost.

Any Confidential Unit Employee who leaves in good standing from the City shall be compensated for a maximum of two-hundred eighty (280) hours at the employee’s hourly rate of pay at the time of separation from City service.

D. Floating Holidays

All Eligible unit members shall receive two (2) floating holidays for the fiscal year for their use beginning on July 1 of each fiscal year.

E. Vacation Conversion to Cash

Confidential Unit Members may cash out vacation leave hours in the increments of ten (10) hours as long as it has been budgeted and must have the City Manager’s Approval.

Payments of cashed-out vacation leave will be made on the first full pay day which follows A.23.a
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the end of the thirty (30) day advance. This payment will be made in the regular payroll check issued for that pay period.

8. SICK LEAVE

A. Entitlement

Sick leave shall be accrued at a rate of twelve (12) days per year (8 hours per month).

B. Accrual

Unused Sick Leave may be accrued without limit.

C. Sick Leave Conversion to Cash

All Confidential Unit Members employees may be compensated for a percentage of accrued, unused sick leave to cash at death or retirement from City employment. The

provisions for this policy are as follows:

1. Confidential Unit Members may not "cash out" or be compensated for any of the first 240 hours of sick leave accrued.

2. Any Confidential Unit Member having completed 10 years of continuous service with the City and who retires from City service by filing for Service Retirement with

CalPERS, will be compensated for fifty percent (50%) of accrued, unused sick leave in excess of 240 hours at the employee's hourly rate of pay at the time of retirement from City service.

3. The surviving spouse or State-registered Domestic Partner, beneficiary(s), dependent(s), or estate of any current employee of this unit who has completed 10 years of continuous service with the City and dies while employed by the City prior to retirement, will be compensated for fifty percent (50%) of accrued, unused sick leave in excess of 240 hours at the employee's hourly rate of pay at the time of death.

4. Any Confidential Unit Members having completed 10 years of continuous service with

the City and having an unused sick leave accrual balance exceeding 500 hours may, at their option, "cash out" up to a maximum of 96 hours (12 days) of unused sick leave annually as long as the "cashed out" hours do not diminish the unused sick leave accrual balance to an amount less than 500 hours.

6. Payments of "cashed out" unused sick leave will be made on the first pay day which A.23.a
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follows June 1st and December 1st of each year.

9. ADMINISTRATIVE LEAVE

All Confidential Unit Members shall receive eighty (80) hours Administrative Leave on July 1st of each fiscal year. The terms for use of Administrative Leave are as follows:

A. Administrative Leave credit will be accrued at the rate of 3.08 hours per pay period.

B. The entire eighty (80) hours of Administrative leave will be advanced and be available for use on July 1 of each fiscal year.

C Leave usage must be identified and recorded on the official time card for the period in which leave was taken.

D. Residual Administrative Leave not utilized during the fiscal year may not be carried over into a subsequent year unless prior approval by the City Manager.

Administrative Leave shall not be cumulative and shall not be converted into monetary compensation, except upon termination or retirement.

E. In the event an eligible employee terminated during the year, unused accrued Administrative Leave shall be paid out in the same manner as unused vacation. If leave has been taken beyond that which is accrued, the employee must pay back all excess leave taken.

F. For eligible employees hired during the year, prorated leave credit will be accrued from the date of hire.

10. INSURANCE

A. Description

The City of Hollister Flexible Benefits Plan/Cafeteria Plan (hereinafter “Plan") is available to full-time employees (hereinafter “Employees"). There will be three participation levels as referenced under Section [E]. Optional benefits are listed below. Once an election is made, it will remain in force until the next open enrollment period. A Third Party

Administrator (T.P.A.) fee will be paid by the employees that participate in the Plan.

B. Health Insurance Options

The City shall provide employees with the choice of participating in the Public Employees' Medical and Hospital Care Act (PEMHCA) program offered by CALPERS.

C. IRS Code Section 125 Flexible Benefits/Cafeteria Plan

1. The City shall provide for unit members an IRS Code Section 125 Flexible Benefits/Cafeteria Plan in accordance with all applicable state and federal laws and A.23.a
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regulations.

2. The City shall contribute towards the PEMHCA medical, dental and vision care plan amounts allocated in accordance with the City's IRS Code Section 125 Flexible Benefits/Cafeteria Plan as specified below.

3. The City shall allocate specified amounts of "Flex Credits" to the employee's flexible benefit account. These amounts shall consist of the following:

a. The City will contribute a dollar amount towards medical insurance based on the PEMHCA’s Platinum plan for Calendar Year 2022.

b. For Calendar Year 2023, the City will increase its contribution by the actual increase or an amount not to exceed 10%.

a. For Calendar Year 2023: The City will continue to contribute a dollar amount towards monthly medical insurance premiums at the following levels:

COVERAGE EMPLOYER CONTRIBUTION
Employee Only $1,162.71
Employee Plus One $2,325.42
Employee Plus Family $3,023.05

b. For Calendar Year 2024: The City will increase its contribution by the actual increase to the PERS Platinum monthly premium or an amount not to exceed 10%.

c. For Calendar Year 2025: The City will increase its contribution by the actual increase or the PERS Platinum monthly premium an amount not to exceed 10%.

c.d. An amount equivalent to the City’s contribution towards dental insurance.

The required contribution for employees electing dependent coverage in accordance with Section [E] below shall be excluded from this total.

d.e. An amount equivalent to the City’s contribution towards vision insurance.

The required contribution for employees electing dependent coverage in accordance with Section [E] below shall be excluded from this total.

4. In the event that surplus Flex Credits are available, any Confidential Unit Employee shall have the option to allocate such Flex Credits to one or more of the following:

a. Confidential Unit Employees’ Flexible Spending Account. b. Roth Individual Retirement Account (IRA).
c. ICMA or City-authorized 457 Deferred Compensation Plan.

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If a Unit Employee’s residual “Flex Credits” are reduced, the employee will have the responsibility to pay the contribution no longer covered by the Surplus Flex Credits.

5. Employees who waive either dental and/or vision coverage shall have the option to apply available flex credits towards the cost of any optional premium listed in the respective sections below. The cost of the optional premium not covered by available flex credits shall remain the employee’s responsibility.

6. Employees who elect to waive any or all health coverage shall be subject to the terms and provisions described under Section [J] below.

D. Terms for Health Care Participation

Participation and coverage in the medical, dental, and vision care plans shall be in accordance with the terms and conditions of the insurance carrier.

E. Health Care Contributions

1. Employee-only Premium

The City shall contribute towards the medical, dental, and vision insurance plans an amount equal to the employee-only premium at the time of adoption of this M.O.U. for each member of the unit. for Calendar Year 2022. The employee-only premium for medical insurance shall be in accordance with Section [C] above.

2. Employee Option for Dependent Coverage

Starting Calendar Year 2022, for tThose employees who elect the option for dependent coverage for medical, dental, and vision insurance plans, the City shall contribute monthly amounts equal to the employee plus one and employee plus family toward such dependent coverage in accordance with Section [C] above. This section does not affect the current coverage for Calendar Year 2021.

F. Vision Insurance

The City shall provide a vision care insurance plan which is available to eligible unit members and qualified dependents during the term of this M.O.U.

The City shall offer vision care insurance for employees and qualified dependents as a pre- tax flexible benefit option. Participation and coverage shall be in accordance with the terms and conditions of the insurance carrier.

G. Dental Insurance

The City shall offer dental care insurance for employees and qualified dependents as a pre- A.23.a
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tax flexible benefit option. Participation and coverage shall be in accordance with the terms and conditions of the insurance carrier.

H. Life Insurance

The City shall provide term life insurance in the amount equal to $100,000 for each member of the unit for the term of this M.O.U. Additional term life insurance may be purchased by the employee in increments of $10,000 up to a total of $250,000.

I. Long Term Disability Insurance

Disability Plan carrier that meets these requirements.

J. Health Insurance Waiver Option

1. Employees within this bargaining unit who elect not to participate in the City's health care insurance program will be compensated in an amount as follows:

$535 Employee Only
$1,075 Employee plus one
$1,380 Employee plus family

The compensation will be based on the level in which the employee is eligible to participate (employee only, employee plus one dependent, employee plus two or more dependents) at the time of waiving City insurance coverage in accordance with Section [3] below. This cash amount will be paid as part of the employee's bi-weekly payroll.

2. Employees within this bargaining unit shall be eligible to elect not to participate in the City’s health care program.

2. Employees within this bargaining unit electing not to participate in the City's health care insurance program must annually provide proof of medical insurance coverage by an outside provider in order to maintain payment under this waiver option.

4. For employees who elect not to participate in the group medical coverage offered by the City, the City will provide dental and vision coverage for the employee and his/her dependents at no cost to the employee.

5. In addition to the coverage options specified under Article 7. Insurance of the Memorandum of Understanding between the City of Hollister and Confidential Unit members, the following optional health benefits shall be available to the employees of A.23.a
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this bargaining unit.

K. Optional Health Benefits

Employees within this unit that have elected to participate in a City-offered medical plan can also elect to participate in the optional benefits. If the employee has any surplus flex credits after making all elections required to participate in the medical insurance, the employee can use that surplus toward optional qualified insurance benefits or one or both of the pre-tax spending accounts. Employees that wish to participate in the optional benefits plan, but do not have any surplus credits, can elect to have a pre-tax payroll deduction in an amount to cover the cost of their elections.

Employees may pay the premiums for the following benefits on a voluntary basis:

- Medical Insurance
- Dental Insurance
- Vision Insurance
- Group Term Insurance up to $50,000 for Employees only - Accidental Death and Dismemberment Insurance
- Short Term Disability
- Cancer Insurance
- Supplemental Health Insurance
- Accidental Only Insurance
- Intensive Care Insurance

L. Flexible Spending Accounts (FSA's)

The City agrees to offer a pre-tax dependent care reimbursement account up to the maximum reimbursement allowed by law to be funded by employee.

The City agrees to offer a pre-tax medical reimbursement account, up to two thousand five hundred dollars ($2,500) per year per employee.

M. Voluntary Life Insurance

N. Miscellaneous

The City of Hollister does not allow the employee to take the surplus credits in taxable A.23.a
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cash. For employees who elect not to participate in the group medical coverage offered by the City, the City will provide dental and vision coverage for the employee and his/her dependents at no cost to the employee.

O. Cost-Savings

During the term of this agreement, the parties agree that upon request to meet and discuss regarding potential cost savings/sharing measures related to health and welfare plan designs or premiums.

11. RETIREMENT

A. Contribution

Tier 1
a. Effective the first full pay period after the execution of the MOU, and the City’s subsequent adoption of the Resolution changing the CalPERS Retirement Employee Contribution Rate, all unit employees under the Miscellaneous CalPERS “2.5% @ age 55” Retirement Benefit Plan shall pay eight percent (8%) of their Compensation as part of the Employees’ contribution.

Tier 2
b. Effective the first full pay period after the execution of the MOU, and the City’s subsequent adoption of the Resolution changing the CalPERS Retirement Employee Contribution Rate, all unit employees under the Miscellaneous CalPERS “2% @ age 60” Retirement Benefit Plan shall pay seven percent (7%) of their Compensation as part of the Employees’ contribution.

Tier 3
c. Effective on or after January1, 2013, all new employees hired on or after January 1, 2013, and who are defined as a “new member” under the Public Employee Pension Reform Act of 2013 (PEPRA), AB 340 shall pay the employee contribution rate as established by State of California law.

B. 1959 PERS Survivor Death Benefit

The City shall provide the PERS Section 21574 "Fourth Level 1959 Survivor Death Benefit" for all eligible unit members for the term of this contract. The City shall pay the employer rate contribution. The employee shall pay the member rate contribution.

C. One-Year Final Compensation Benefit

The City shall provide the PERS Section 20042 "One Year Final Compensation" benefit A.23.a
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for eligible unit members.

All new employees hired on or after January 1, 2013, and who are defined as a “new Member” under PEPRA, are subject to the new State Formulas, Final Compensation Period, and Contribution requirements as established by the PEPRA.

12. PROFESSIONAL DEVELOPMENT INCENTIVE PROGRAM

Employees who have successfully completed probation shall be eligible to receive a one-time professional development incentive for obtaining certificates or degrees received after the date of this M.O.U. A professional development incentive shall not be awarded if the certification or degree is a minimum requirement for their position.

The certificate must relate to the employee's current position or future lateral or promotional opportunities with the General Employees Unit, Mid-Management Association or the unrepresented units of Confidential Employees and Executive Management. Vocational Training, for purposes of this section, is defined as a minimum of 100 hours of specific training in a career field which results in a certificate of completion. The minimum one hundred (100) hours shall be documented classroom time or in the case of a correspondence program identified as the average length of time required to complete the program certification as documented by the certifying agency or institution. Only one (1) professional development incentive per fiscal year can be received by an employee. If an employee receives a Ph.D., Master's degree or Bachelor's degree in a fiscal year, the employee may also receive one (1) additional professional development incentive for a certificate earned in the same fiscal year.

Additionally, any additional development incentives earned in the same fiscal year do not rollover to the subsequent fiscal year. The city will reimburse members up to Thirty-Five Hundred dollars ($3,500.00) four thousand five hundred dollars ($4,500.00) per fiscal year for tuition reimbursements.

A. Professional Certificates - $2,500.00 Lump Sum:

- Professional Engineer Registration
- Professional Land Surveyor Registration
- Certified Public Accountant
- Engineer-In-Training
- Land Surveyor-In-Training
- American Institute of Certified Planners
- Paralegal Certificate
- Grade 5 Water Treatment Operator or Water Distribution Operator - Grade 5 Waste Water Treatment Operator
- Certified Municipal Clerk (CMC)
- Master Municipal Clerk (MMC)
- QSP
- QSD

B. College Degrees and Certificates - $2,500.00 Lump Sum

- Ph.D.

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- Master's Degree
- Bachelor's Degree
- Associate's Degree

C. Technical Certificates - $2,000.00 Lump Sum:

- Grade 4 Water Treatment Operator or Water Distribution Operator - Grade 3 Water Treatment Operator or Water Distribution Operator - Grade 2 Water Treatment Operator or Water Distribution Operator - Grade 1 Water Treatment Operator or Water Distribution Operator - Grade 4 Waste Water Treatment Operator
- Grade 3 Waste Water Treatment Operator
- Grade 2 Waste Water Treatment Operator
- Grade 1 Waste Water Treatment Operator
- I.C.B.O. Certificates
- Public Works Inspector – NICET
- Cross Connection Control Specialist Certification
- Certified Arborist

D. Vocational Certificates of Completion:

Examples:

- A(+) Certification (Computer Hardware, Software & Networking) - Microsoft Certified Systems Engineer
- Cisco Certified Network Associates
- Operation Of Wastewater Treatment Plants Program administered by California State University, Sacramento Regional and Continuing Education Program - Title 29 CFR 1910.120(q) - 24 Hour Hazardous Materials (Hazmat) Technician Level III Certification

The amount of the incentive for any Vocational Certificate of Completion shall be based on the following number of hours of course work:

Minimum Hours
For Vocational Certificate Amount

100 $ 1,500.00
80 $ 1,200.00
60 $ 900.00
40 $ 600.00
20 $ 300.00

E. Technical Certificates - $1,000.00 Lump Sum:

- Chemical Applicator
- Licensed Tree Trimmer

- Automotive Service Technician (A.S.E.)

F. Additional Eligibility Criteria

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- The license or certificate submitted for consideration must directly relate to the employee's current position or future lateral or promotional opportunities in

accordance with the provisions of this section.

- The employee earning the license or certificate shall be subject to duties and assignments commensurate with the level of proficiency attained under the City's Professional Development Incentive Program.

- After the effective date of this M.O.U., all such requests for consideration for eligibility for such license and certificate incentives shall be submitted to the

Department Head for review, with final approval by the City Manager at his/her sole discretion. The City Manager’s determination is not subject to appeal.

The process for receiving a professional development incentive under this program shall be:

- Prior to beginning any class, program, seminar or study toward a desired certificate or degree, the employee must submit a request to his/her department head for consideration and approval of bonus award. Qualifying classes, programs, seminars or study toward a desired certificate or degree shall not be denied.

- If prior approval is not obtained, the class, program, seminar or study toward a desired certificate or degree shall not fall within the scope of this Professional Development Incentive Program.

The following are not eligible for consideration under this Section:

- Any driver's licenses

- Certificates, licenses, or degrees required for the position the employee holds

- Certificates, licenses, or degrees earned at the expense of the City including City sponsored training programs and consortium training programs except for

approved tuition reimbursement pursuant to Section 8.10 (D) and (E) of the City of Hollister Personnel Rules & Regulations for Associate degrees, Bachelor's degrees, Master's degrees, and Ph.D. degrees.

13. TUITION REIMBURSEMENT

The City will provide for tuition reimbursement in accordance with provision of the current A.23.a
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Personnel System Rules and Regulations. In order to be eligible for this reimbursement the employee must obtain prior approval for the course from both the department head and the City Manager.

14. DEFERRED COMPENSATION PLAN

The City shall continue to provide a voluntary Deferred Compensation Plan for all employees of this unit for the term of this M.O.U.

15. BILINGUAL ALLOWANCE

Employees who perform technical bilingual skills (reading, writing and oral translation) for the benefit of the City on a regular and ongoing basis and who successfully pass City- administered proficiency test shall receive an allowance based on the level(s) of bilingual competency listed below.

Level I – Oral Translation

Employees who perform technical bilingual skills (reading, writing, translation) and who successfully pass a City-administered proficiency test shall receive an allowance of one hundred seventy-five dollars ($175.00) per month.

Level II – Written Translation

For employees who successfully pass the written proficiency test, shall receive an additional amount of one hundred and seventy-five dollars ($ 175.00) per month. Each department within the City will be allowed 3 positions of level 2 bilingual services. If a department’s need for bilingual services becomes greater than the allotted 3 positions, the department head may request to increase its bilingual services pending City Managers approval.

Employees who become eligible for Level II will be required to serve as an oral translator and/or provide written translation in the course of the employee’s duties on a regular and on-going basis, per the City’s needs. These employees may be called upon by other departments on an as need basis.

Such Level II Bilingual Translators shall perform written translations that are viewed by a large audience of city residents (i.e. City mailers, informational brochures, inserts in city utility billings, social medial, public notices, and any additional documents as needed.) Employees, who are currently receiving Level I Bilingual Allowance, will not be required to retest in order to continue receiving the monthly allowance.

16. DRUG FREE WORKPLACE POLICY

The City's Drug Free Workplace Policy, City Personnel Rule 2.05, adopted by Resolution A.23.a
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92-116 (August 3, 1992), is incorporated by reference into this M.O.U.

17. MILEAGE REIMBURSEMENT

The City shall reimburse all eligible unit members for mileage driven in their personal vehicles while conducting City Business at the rate specified by the Internal Revenue Service. Claims for such reimbursement must be submitted on the proper City form and approve by the city before payment can be made.

18. JURY DUTY AND SUBPOENAED WITNESS

Any eligible employee of this unit shall be allowed to take leave from his/her City Duties without loss of wages, leave time or other benefits for the purpose of responding to jury selection or serving on a jury for which he/she has been selected, subject to the limitation that an employee receives paid leave for jury duty not more than once per calendar year. In the case of serving on a jury more than one time during a year, the employee has the option of using leave time to mitigate loss of pay. No employee shall suffer loss of wages or other benefits responding to a subpoena to testify in court on behalf of the City.

19. LONGEVITY PAY

A longevity bonus shall be paid to employees of this unit who complete the following specified consecutive years of service after the effective date of this M.O.U.:

NUMBER OF

CONSECUTIVE YEARS LONGEVITY BONUS
10 - 14 Years Three Percent (3.0%) of Base Salary
15 - 19 Years Six Percent (6.0%) of Base Salary
20 or more Years Nine Percent (9.0%) of Base Salary

20. LAND SURVEYOR LICENSE CERTIFICATION

All employees of this unit who possess and maintain a valid California Land Surveyor License shall receive Annual Incentive Pay of five percent (5%) of base salary, payable as part of the employee’s bi-weekly payroll. Employees covered by this agreement, whose job assignment as determined by the City Manager requires this certificate and performs the work will be the individuals that receive the annual incentive pay.

21. COMPUTER LOAN PROGRAM

Confidential Employees shall be eligible to purchase computer equipment through the City.

Under this program, the City shall offer a one-percent (1%) loan to Confidential Employees who purchase a computer, printer, scanner, and/or any directly-associated computer hardware/software package. All Confidential Employees who participate in this program must pay back the loan in full either directly or through payroll deductions within one year

from the date of the loan. Confidential Employees shall make twelve equal payments payable once per month.

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Confidential Employees shall be eligible for a subsequent loan contingent upon the full balance of the previous loan paid off in full. Employees electing to participate in this program shall specify in writing their agreement to allow withholding of any unpaid balance through payroll deductions in the event the employee leaves City service or expires.

The computer equipment shall remain the property of the Confidential Employee at all times after purchase.

22. NOTARY PUBLIC COMMISSION PAY

Any Confidential Unit Employee who possess and maintains a Notary Public Commission shall receive an allowance of $125.00 per month. Employees who receive Notary Public Commission Pay shall remain subject to the needs and requirements of the City.

23. ACCOUNTING MANAGER – CERTIFIED PUBLIC ACCOUNTANT LICENSE

CERTIFICATION PAY

In accordance with the finance, budgeting, accounting requirements of the City and pursuant to the licensing requirements of the State of California Board of Accountancy, the position of

Accounting Manager shall be entitled to Certification Pay in the amount of Five-Percent of salary based upon the Accounting Manager obtaining of and maintaining a California Certified Public Accountant License.

24. WORKING OUT OF CLASSIFICATION ASSIGNMENT

1. The position must be budgeted.

2. Must be assigned in writing by the department head and approved by the City Manager to work in a higher classification and, therefore, performs substantially all of the duties of the higher classification for a period of more than ten (10) consecutive working days or eighty (80) consecutive working hours in a fiscal year, (or eight (8) consecutive working days) the employee, shall be entitled to be compensated with an additional five percent (5%) over his/her current rate of pay, beginning with the eleventh (11th) day or the eighty–first (81st) hour of the

assignment. A continuous out–of–classification assignment bridging two (2) fiscal years shall be treated as if it occurred during the prior fiscal year. For example, an employee receiving the compensation for an assignment, which commences on June 15 of one (1) fiscal year and ended on July 5 of the succeeding fiscal year,

would receive compensation for the entire assignment. Similarly, an employee whose 11th day or eighty–first (81st) hour of out–of–classification assignment occurred during the prior fiscal year would commence receiving compensation as A.23.a
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of the 11th day or eighty–first (81st) hour. This provision shall apply only as pensionable compensation for Classic Members as defined by the Public Employees’ Pension Reform Act (PEPRA) of 2013 as it is currently enacted and as it is amended in the future, and its implementing regulations, referred to hereinafter collectively as “PEPRA”.

3. The grievance procedure shall not be utilized by unit members in any conflict and Management's assignment or non-assignment is final a binding upon all parties.

25. FLEXIBLE WORK SCHEDULE

Eligible unit members may work flexible work schedules (i.e. 4/10, 9/80) when feasible. It is
not the intention of the City to reduce the number of hours that City services are available to the public. It is agreed that implementation of flexible work schedules shall be evaluated on a work unit basis, and will only be approved in those units where flexible work schedules can be implemented without reducing service levels and cost effectiveness.

26. PERSONNEL SYSTEM RULES AND REGULATIONS

This M.O.U. sets forth certain benefits and working conditions for employees in the Unit.

Other rules, regulations, policies, and general working conditions governing employment for employees covered by this M.O.U. are set forth in the Personnel System Rules and Regulations of the City except that the discipline proposed or imposed on employees within this unit shall be subject to the procedures specified in Exhibit [A] entitled Section 12. Disciplinary Procedures, which is incorporated herein by this reference. If during the term of this M.O.U. the City desires to amend the Personnel System Rules and Regulations, the City shall give notice to the Unit of the proposed changes. Representatives of the City and Unit shall meet in a timely manner. Hours, wages, and general working conditions contained in the Personnel System Rules and Regulations are the proper subjects of the grievance procedure.

The City intends to revise Personnel Rules and Regulations at which time the City will consider incorporating a Violence in the Workplace Prevention Policy. When the revisions to the Rules and Regulations are discussed with all employee associations, City will consider Unit’s requests relating to that policy.

27. STANDBY PAY

Employees covered by this agreement who are assigned to standby duty shall be paid two- hundred fifty dollars ($250.00) three hundred fifty dollars ($350.00) for each week that they are so assigned. Standby pay can be

broken down by a rate of $35.71 $50.00 per day ($250 $350.00 divided by 7 days) to the maximum of $250.00 $350.00 per week. The City shall have full discretion in making and administering standby assignments. This shall include, but not be limited to, the authority of the City to:

1. Require an employee to be available at all hours by telephone or to use a pager.

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2. To restrict employee’s travel in order to perform standby assignments.

3. Require employee to refrain from activities which would impair the ability to respond to emergency situations.

Management agrees to involve employees in discussions regarding standby policy modifications.

Standby assignments shall be scheduled in advance to provide even distribution of on-call assignments to the extent possible. However, schedule adjustments may be necessary due to illness, vacation, vacancy, and/or other types of approved leave.

28. EVENT PAY
Any Unit Employee who is required to work a special event (i.e. Hollister Motorcycle Rally, Hollister Airshow, HazMat Day, etc.) and with City Manager’s approval will be compensated $400 per day.

29. HUMAN RESOURCES TECHNICIAN I/II – FLEXIBLY STAFFED POSITION

The City shall advance employees that are in the entry level of flexibly staffed classifications to the journey level after meeting the experience requirements for the journey level classification, successfully passing a probationary period in the entry level classification and being given a satisfactory performance evaluation.

30. TERM OF AGREEMENT

The term of this M.O.U. shall commence on July 1, 20212023 and shall expire June 30, 20232025, unless otherwise agreed to by both parties. It is also agreed to by both parties to initiate the meet and confer process in a timely fashion, exchanging written proposals at least thirty (30) days prior to the termination of this agreement. An extension of the term of this agreement on a month to month basis may be made my mutual agreement of the parties.

The effective date of this Memorandum of Understanding is the date on which the City Council takes action in an open and public meeting to ratify and approve this M.O.U.

(Last Updated on 06-07-21: DH)

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The above constitutes a full and complete agreement between the parties on all matters within the scope of representation.

CITY OF HOLLISTER HOLLISTER CONFIDENTIAL

EMPLOYEE UNIT

Dated ______________________________ Dated ______________________________

By _________________________________ By _________________________________ David Mirrione Hydie Mc Donald
Interim City Manager Management Analyst
Unit Negotiator

By _________________________________ By _________________________________ Casey Estorga Michelle Scharton
Administrative Services Director Payroll Manager
City Negotiator Unit Negotiator

By _________________________________
Mary Lerner
City Attorney
City Negotiator

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EXHIBIT [A]

SECTION 12. DISCIPLINARY PROCEDURE

Section 12.01 General

Section 12.02 Grounds for Discipline

An employee may be reprimanded, suspended, denied a merit increase, demoted or dismissed for any of the following reasons:

1. Furnishing false information to secure employment.

2. Incompetence, which shall mean that the employee lacks adequate ability, knowledge, motivation, or fitness to satisfactorily perform the duties which are within the scope of employment.

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3. Inefficiency in performance of work which results in performance lower than that which is typically expected of the position.

4. Neglect of duty.

5. Insubordination, which shall mean refusal or failure to follow a direct, lawful order which the

employee is capable of following.

6. Nonobservance of work hours.

7. Excessive absenteeism, tardiness, or absence without authorized leave.

8. Violation of city personnel rules and regulations, administrative policies and procedures, department rules and regulations, safety rules, resolutions, ordinances or codes.

9. Damage to or waste of public property, equipment or supplies, or unauthorized possession or use of public property, supplies or equipment.

11. Willful failure or refusal to property perform official duty.

12. Gross negligence in the discharge of official duty.

13. Dishonesty involving employment.

14. Any act of moral turpitude which adversely reflects on the employee's ability or fitness to perform his/her duties.

16. Disclosure of confidential information to an unauthorized source.

17. Refusal to take and subscribe to any oath or affirmation which is required by law in connection with employment by the city.

18. Falsification of time sheets or any official city records.

19. Misuse of sick leave.

20. Consuming, possessing, or being under the influence of an alcoholic beverage, while on duty.

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21. Unless legally authorized, using, consuming, injecting, possessing, being under the influence of, selling or offering for sale, while on duty, any drug which can or does impair, the employee's work performance, or any controlled substance as the latter term is defined in the California Health and Safety code.

22. Discourteous or disrespectful treatment of the public, other employees, or city officials.

23. Violation of city harassment policy.

25. Engaging in outside employment in violation of city policies or rules.

26. Engaging in non-City business during work hours, excluding employee free time such as lunch and breaks.

Section 12.03 Types of Disciplinary Action

As used in this section, "disciplinary action" shall mean any of the following and may be taken singly or in combination:

C. Imposition of special employment conditions. Such action shall be subject to the appeal process outlined below.

E. Reduction in pay level not to exceed one (1) year. Such action shall be subject to the appeal process outlined below.

F. Demotion. Such action shall be subject to the appeal process outlined below.

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G. Dismissal or Discharge. Such action shall be subject to the appeal process outlined below.

Section 12.04 Notice of Intended Disciplinary Action

notice of intended disciplinary action which shall include:

1. The reasons for the disciplinary action, those facts alleged to be the basis for the intended action and copies of any documents or materials upon which the disciplinary action is based;

2. The specific action proposed to be taken, including any time period or other conditions associated with the discipline;

3. The proposed effective date of the intended disciplinary action; and

B. A copy of the notice of intended disciplinary action shall be placed in the employee's personnel file.

Section 12.05 Pre-disciplinary Conference

Where an employee has requested an opportunity to respond orally, the disciplining authority or his/her designee shall cause an informal pre-disciplinary conference to be held to review the statement of charges and to provide the opportunity for the employee or his/her representative to answer the charges. The disciplining authority or his/her designee shall allow the parties to present any relevant evidence tending to prove or disprove the facts upon which the action is based or upon the nature and severity of the proposed disciplinary action. Failure of the employee to appear at the pre- disciplinary conference, if requested, shall forfeit all the employee's right to respond to the statement of charges.

Section 12.06 Notice of Discipline or Rejection of Discipline

B. If the decision is to affirm or reduce the proposed disciplinary action, such action shall be served on the employee personally or by mail. The written notice of disciplinary action shall include:

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1. The reasons for the disciplinary action, those facts alleged to be the basis for the disciplinary action and copies of any documents or materials upon which the disciplinary action is based;

2. The specific action proposed to be taken, including any time period or other conditions associated with the discipline;

3. The effective date of the disciplinary action; and

4. The right of the employee to appeal the disciplinary action. The employee shall be advised that he/she has ten (10) working days within which to file a written appeal of the disciplinary action.

C. A copy of the notice of disciplinary action shall be placed in the employee's personnel file.

D. If the notice is to abandon all action, the notice of intended disciplinary action shall be removed from all personnel files.

Section 12.07 Appeal of Disciplinary Action

An employee who has been discharged, demoted, reduced in salary, been made subject to specific employment conditions, or suspended without pay has the right to appeal to the City Manager the disciplinary action by filing a written notice of appeal within ten (10) working days from the date of the notice of discipline. The appeal must state specifically the reason or reasons upon which it is based. Failure to file within the time allowed constitutes abandonment of appeal rights. The evidentiary appeal shall be heard by a hearing officer who will serve as the City Manager’s designee.

Section 12.08 Appeal

Section 12.09 Evidentiary Appeal Hearing Procedure

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Any time lines contained in this section may be extended upon mutual agreement of the City and the appellant for good cause.

1. Oral evidence shall be taken only on oath or affirmation.

2. Each party shall have these rights: to call and examine witnesses; to introduce exhibits; to cross-examine opposing witnesses on any matter relevant to the issues even though that matter was not covered in the direct examination; to impeach any witness regardless of which party first called him or her to testify; and to rebut the evidence against him or her. If the appellant does not testify on appellant’s own behalf, s/he may be called and examined as if under cross- examination.

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The participation of the appellant’s representative at the hearing shall constitute appearance of the appellant.

L. The City Council shall deliberate in closed session and shall issue a decision which affirms, reverses, or modifies the discipline imposed by the City Manager.

N. The decision of the City Council shall be final and subject to judicial review under Code of Civil Procedure 1094.5.

Section 12.10 Serving of Notices

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Written notices shall be served either by direct personal service on the person affected, or by mail.

Section 12.11 Summary Suspension

Prior to any disciplinary proceedings under this section, the City Manager may summarily place any City employee on an immediate suspended status with or without pay. Such suspensions shall be made only in cases where the employee's continued active duty status might, in the sole opinion of the City Manager, constitute a hazard to the employee or others, tend to bring the City service into discredit, or prolong acts or omissions of improper employee conduct. If the disciplinary action or suspension is not subsequently ordered and/or affirmed, the employee shall be reinstated in status and restored all pay and fringe benefits lost during such summary suspension.

Section 12.12 Right to Representation

Section 12.13 Records Purged

(Updated 08-224-21: dh)

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STAFF REPORT

CITY COUNCIL REGULAR MEETING AGENDA
MEETING DATE: JUNE 20, 2023
SUBMITTED: May 31, 2023
DEPARTMENT:

DEPARTMENT HEAD:

Recreation
Tina Garza, Recreation Services
Manager

TITLE OF ITEM: ORDINANCE NO. 1236 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HOLLISTER AMENDING THE CITY OF HOLLISTER MUNICIPAL CODE, TITLE 17-

ZONING TO ESTABLISH A SUSTAINABLE ART DEVELOPMENT FEE FOR RESIDENTIAL, COMMERCIAL, AND INDUSTRIAL DEVELOPMENT. ADDITIONALLY, COVER REPAIR

COST, ADDITION, AND ALTERATIONS OF SUCH PROJECTS IN THE CITY OF HOLLISTER

BRIEF DESCRIPTION: This item would introduce an ordinance to create Chapter 17.26 - Art Development Fees.

RECOMMENDATION: Hold a public hearing and introduce an ordinance to create Chapter

17.26 - Art Development Fees.

DEPARTMENT SUMMARY: An ordinance amending the City of Hollister Municipal Code, Title 17– Zoning, to establish an Art Development Fee for Residential Development and Commercial and Industrial Development, and repair cost, additions, and alterations of such projects in the City of Hollister. The ordinance approves a sustainable revenue source needed to promote the general welfare and improve livable communities by encouraging the use and incorporation of publicly accessible art in new residential, commercial, and industrial construction. By doing so, the City protects and enriches its character, improves the quality of life for those who visit, live, or work in the City, promotes community economic viability, and engages citizens, neighborhoods, companies, and community groups in creative collaborations with artists. As part of the project review and approval process, the applicant shall pay a fee equal to one percent of the building valuation for each building permit.

The Art and Cultural Commission reviewed the art development fee at a special meeting on February 7, 2023, and recommended that the City Council of the City of Hollister approve the ordinance as written.

FINANCIAL IMPACT: None at this time

CEQA: N/A

THIS REPORT WAS REVIEWED BY THE INTERIM CITY MANAGER WHO CONCURS WITH

THE STAFF RECOMMENDATION

David Mirrione, Interim City Manager

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ORDINANCE NO. 1236

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HOLLISTER AMENDING THE CITY OF HOLLISTER MUNICIPAL CODE, TITLE 17-ZONING TO ESTABLISH A

SUSTAINABLE ART DEVELOPMENT FEE FOR RESIDENTIAL, COMMERCIAL, AND INDUSTRIAL DEVELOPMENT. ADDITIONALLY, COVER REPAIR COST, ADDITION, AND

ALTERATIONS OF SUCH PROJECTS IN THE CITY OF HOLLISTER

WHEREAS, the City of Hollister desires to adopt an art development fee to establish a sustainable revenue source needed to promote the general welfare and improve livable communities by encouraging the use and incorporation of publicly accessible art in new residential, commercial, and industrial construction; and

WHEREAS, an ordinance amending the City of Hollister Municipal Code, Title 17 – Zoning, to establish an Art Development Fee for Residential Development and Commercial and Industrial Development, and repair, addition, and alterations of such projects in the City of Hollister has been drafted; and

WHEREAS, as part of the project review and approval process, the applicant shall pay a fee equal to one percent of the building valuation for each building permit; and

WHEREAS, The Art and Cultural Commission reviewed the draft art development fee ordinance at a special meeting on February 7, 2023, and recommended the City Council of the City of Hollister approve the ordinance as written; and

NOW THEREFORE, BE IT RESOLVED, that the City Council of the City of Hollister does hereby ordain as follows:

Section 1. Chapter 26 of Title 17 of the Hollister Municipal Code is hereby added in its entirety to read as follows:

17.26 Civic Art Fund

A. Purpose. This Section aims to promote the general welfare and enhance livable communities by promoting the use and incorporation of publicly accessible art in private development. By doing so, the City preserves and enriches its character, improves the quality of life for those who visit, live, or work in the City, and fosters the economic vitality of communities. And engages residents, neighborhoods, businesses, and community organizations in creative partnerships with artists. This section sets forth requirements for the provision of Civic Art, in connection with conditions for the design of Residential Development and Commercial and Industrial Development Projects, based on the following findings:

1. That artistic and cultural resources enhance the quality of life for individuals living in, working in, and visiting the City of Hollister;

2. That the development of artistic and cultural resources in communities preserves and improves the quality of the urban environment, encourages civic engagement, promotes cultural diversity, enhances social well-being, and fosters economic vitality of communities;
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3. That as Residential Development and Commercial and Industrial Development, and repair, addition, and alterations of such development within the City of Hollister continues, the need to develop new artistic and cultural resources to enhance the environment, image, and character of the community increases;

4. That the development of artistic and cultural assets should be financed by those whose Residential Development, Commercial and Industrial Development, and repair, addition, and alteration projects increase the community’s demand for cultural resources; and,

5. The Civic Art Fee is a fair and equitable method of distributing the cost of Civic Art among Residential Development and Commercial and Industrial Development and revitalization projects.

B. Civic Art Fee Established.

The applicant shall pay a fee to be deposited in the Civic Art Fund equal to one percent of the Building Valuation for each building permit.

C. Definitions. For purposes of this chapter, unless otherwise apparent from the context, certain words and phrases used in this chapter are defined as follows:

Art Consultant. An organization or individual working as a professional administrator of the arts, who realizes income through the provision of services relating to the arts such as, but not limited to, contracting artists and arts media for venues with public audiences or providing oversight of on-site logistics, demonstrates previous success in project management, and provides leadership in completion of Civic Art.

Artist. A person who has established a reputation of artistic excellence in the arts, including but not limited to visual, performing or literary arts, as judged by peers and experts in the field, through a record of public exhibitions, performances, commissions, sale of works, recognition and/or educational attainment.

The Arts. Art is the expression of ideas and emotions through a physical medium, like painting, sculpture, film, dance, writing, photography, or theatre.

Building Valuation. The total value of all construction work for which a building permit is issued, and includes, but is not limited to, outside improvements, all finish work, painting, roofing, electrical, plumbing, heating, air conditioning, elevators, fire extinguishing systems and any other permanently installed work or permanently installed equipment.

Civic Art. An original, site-specific work of art or a facility dedicated to the arts that is to be publicly accessible on both private property and publicly-owned property. Works of art or facility acceptable as Civic Art may be in any artistic discipline and any media accepted by the Art and Cultural Commission. Civic Art does not include fixtures or features such as streetlights, benches, signs, or other E.1
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design enhancements unless rendered by an Artist as a unique or limited-edition feature for a Development Project.

Civic Art Fee. A monetary responsibility is other than a tax or special assessment that is collected under the terms of Section 1 to provide funds for Civic Art projects.

Commercial and Industrial Development. Any nonresidential land use, including, but not limited to, retail, office, professional, research, manufacturing, heavy industry, hotels, motels, utilities and private recreational facilities, but not including any use by a public entity for which the City Council is the governing body.

Cultural Facility. Any facility that is open to the public that provides artistic or cultural services, including but not limited to theaters, performance space(s), art galleries, exhibition spaces, artist studio spaces, arts education facilities, and other similar facilities as determined appropriate by the Arts and Culture Commission. The definition does not include churches, schools, commercial movie theatres, gymnasiums or other sports facilities, bookstores, buildings dedicated primarily to housing or administrative activities, and non-profit facilities used for non-profit activities.

Development Project. Any activity which requires the issuance of at least one building permit by the City and includes all related permits contained within the same project.

Landmark. A property, including, any structure, site, place, object, tree, landscape, or natural feature, is designated as a Landmark by a local, state, or federal preservation register.

Residential Development. A Development Project for one or more dwelling units, including mixed-use developments. It may also be a subdivision or a common interest development as defined in Section 4100 of the California Civil Code, approved by the City and consisting of one or more dwelling units. It may also be either a project to substantially rehabilitate and convert an existing commercial building to residential use with one or more dwelling units, or the substantial rehabilitation of an existing multi-family dwelling, as defined in Section 65863.4(d) of the California Government Code.

C. Applicability. The provisions of this Section shall apply only to private Residential Development and Commercial and Industrial Development Projects for which a building permit has yet to be issued as of the effective date of this Ordinance.

D. Establishment of Civic Art Requirement. When a Development Project is subject to the requirements of this Section, the applicant shall comply with the provisions of Subsection E.1 or E.2, or a combination of both, as defined below.

1. Civic Art Program Options. The Civic Art may include but is not limited to the following three types of programs:

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i. Cultural Facilities. The construction, repair, and/or funding of cultural facilities within the City of Hollister.
ii. Conservation. Restoration, conservation or preservation of existing private and/or City-owned publicly accessible Civic Art. This may include, but is not limited to, the restoration or replication of original decorative ornament or artwork deemed historically or culturally significant as part of rehabilitating historic, cultural, and architectural Landmarks. iii. Artistic and cultural programs and services. Artistic and cultural services, including but not limited to:
(1) Performing arts: theatre, dance, music, and performance art; (2) Literary art: poetry readings and storytelling;
(3) Media art: film and video, screenings, and installations; (4) Arts education: lectures, programs, presentations, and instruction in and about arts and culture;
(5) Special events: parades, festivals, and celebrations provided that they are cultural in nature;
(6) Temporary and mixed media artworks: ecological, environmental, lighting, aerial, water, sound, participatory, exhibition; and (7) Similar arts services as approved by the Arts and Culture Commission.

2. For the creation of Civic Art pursuant to this Section, the City of Hollister may hire a professional Art Consultant to assist with all phases of the project development and project oversight from inception to completion.

3. The provision of Civic Art pursuant to this Section shall be subject to the approval of the Art and Cultural Commission in accordance with the City of Hollister policies and implementation procedures.

E. Exemptions from Civic Art Requirement. The following shall be exempt from the provisions of this Section:

1. Commercial and Industrial Development consisting exclusively of rehabilitation work required for seismic safety or to comply with governmental mandates, including the Americans with Disabilities Act of 1990;

2. Replacement, repair, renovation, or rehabilitation to an existing Cultural Facility, including replacement of Civic Art, that a fire or natural disaster has partially or completely destroyed;

3. Affordable housing Development Projects, provided that the Development Projects consist solely of dwelling units, with the exception of a manager’s unit(s), that are affordable to extremely low, very low, lower, or moderate-income households, as defined by Health & Safety Code Section 50105; 50079.5; and 50052.5;

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4. Facilities owned solely by a non-profit organization, as defined under Internal Revenue Code section 501(c)3, provided the premises are used solely in furtherance of the owner’s non-profit purpose; and

5. Commercial and Industrial Development Projects, or portion(s) thereof, that are designed and dedicated to the arts, as long as the sites are maintained within the building, provided the premises continue to be dedicated to the arts. Acceptable facilities include museums, theaters, performance arts centers, and other similar facilities as determined appropriate by the Arts and Culture Commission. Excluded facilities include schools, commercial movie theaters, banquet halls, gymnasiums or other sports facilities, and buildings dedicated primarily to administrative activities.

F. Civic Art Fund.

1. A Civic Art Fund shall be established and shall continue from year to year. The fund shall consist of one account, the Art Development Fund, to be used in all City Council Districts and administered by the City of Hollister apart from the general revenue funds and accounts of the City. All interest and investment earnings in said fund shall accrue to the use and benefit of the applicable fund.

2. All Civic Art Fees the City receives pursuant to this Section shall be deposited in the applicable account in the Art Development Fund. The fund is authorized to accept gifts, grants and donations made to the City for Civic Art.

Acceptance of gifts, grants, donations require City Council approval. If the gift, grant, or donation will be deposited into the Art Development Fund, the Arts and Culture Commission may consider the gift, grant, or donation and provide the City Council a recommendation as to whether the gift, grant, or donation should be accepted or refused.

3. All appropriations, gifts, grants and awards of money or property received for Civic Art from either public or private donors shall be placed in trust for and inure to the use and benefit of the City for Civic Art purposes; and said property and funds shall be expended, utilized and disbursed pursuant to the provisions of this Section.

G. Use of Fees Collected.

1. The Art and Cultural Commission shall make recommendations to the City Council for expenditures from the Development Art Fund following City budgetary procedures and adopted Civic Art policies and implementation procedures, which expenditures shall be exclusively for the acquisition, commissioning, installation, improvement, maintenance and insurance of Civic Art in the City; the restoration, conservation, or preservation of existing Civic Art; the provision of Civic Art in any of the three types of programs described in Subsection D1, above; or any similar arts or cultural services as approved by the Art and Cultural Commission. Any gifts, grants and awards received subject to a condition shall be expended strictly in accordance with such condition.

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2. The Art and Cultural Commission shall provide an annual report to the City Council which outlines the art activities for the previous fiscal year. The report will detail the provision of arts services, restoration and conservation, programs, facilities, and amenities, and the use of all Civic Art Fees collected and deposited in the Development Art Fund. The report may set priorities for using the Art Development Fund in future years.

SECTION 2. Severability.

If any section, sentence, clause, or phrase of this ordinance is held invalid or unconstitutional by any court of competent jurisdiction, then said holding shall not affect the validity of the remaining portions of this ordinance.

INTRODUCED at a regular City Council meeting on the 20th day of June 2023.

PASSED AND ADOPTED, by the City Council of the City of Hollister at a Regular Meeting held this 20th day of June, 2023, by the following vote:

Mia Casey, Mayor
ATTEST:

Jennifer Woodworth, MMC, City Clerk

APPROVED AS TO FORM:

Lozano Smith Attorneys at Law

Mary F. Lerner, City Attorney

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I, JENNIFER WOODWORTH, MMC, City Clerk of the City of Hollister, do hereby certify that the attached Ordinance No. 1236 is an original Ordinance, or true and correct copy of a City Ordinance, duly adopted by the Council of the City of Hollister at a regular meeting of said Council held on the 20th day of June, 2023, at which meeting a quorum was present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Hollister this City Council day of June, 2023.

Jennifer Woodworth, MMC

City Clerk of the City of Hollister
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STAFF REPORT

CITY COUNCIL REGULAR MEETING AGENDA
MEETING DATE: JUNE 20, 2023
SUBMITTED: June 7, 2023
DEPARTMENT:

DEPARTMENT HEAD:

Community Services
William Via, Community Services
Director

TITLE OF ITEM: A PRESENTATION TO THE CITY COUNCIL ON THE DOMESTIC

WASTEWATER TREATMENT PLANT

BRIEF DESCRIPTION: Staff will provide a presentation to the City Council regarding the City of Hollister’s Domestic Wastewater Treatment Plant and receive possible direction.

RECOMMENDATION: Receive the Domestic Wastewater Treatment Plant presentation and provide possible direction.

ATTACHMENTS:

1. 2023-06-20-DWWTP Presentation

THIS REPORT WAS REVIEWED BY THE INTERIM CITY MANAGER WHO CONCURS WITH

THE STAFF RECOMMENDATION

David Mirrione, Interim City Manager

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CITY OF HOLLISTER

DOMESTIC WASTEWATER

TREATMENT PLANT UPDATE
JUNE 20, 2023
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PRESENTATION OVERVIEW
•NEW PERMITTED CAPACITY AT DOMESTIC WASTEWATER TREATMENT PLANT •DOMESTIC WASTEWATER TREATMENT PLANT OPERATOR
•BIO-SOLIDS HANDLING
•FUTURE ITEMS FOR COUNCIL CONSIDERATION
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NEW PERMITTED CAPACITY AT

DOMESTIC WASTEWATER TREATMENT PLANT
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BRIEF CAPACITY HISTORY
•COMPLETED DWWTP EXPANSION AND
UPGRADE IN 2008
•LIFTED BUILDING MORATORIUM IN PLACE
SINCE 2002
•INCLUDED THE ABILITY TO RECYCLE WATER
•UPGRADED TWO MEMBRANE BIO-REACTORS
(MBR) IN 2016
•DID NOT INCREASE PERMITTED CAPACITY AT

THIS TIME
•A SANITARY SEWER COLLECTION SYSTEM
MASTER PLAN WAS UPDATED IN 2018
•BASED ON LAND USE IDENTIFIED IN 2005

GENERAL PLAN
•PROJECTED FLOW AT POTENTIAL BUILD-OUT
OF DEVELOPMENT OF 4.70 MILLION
GALLONS PER DAY (MGD) PER 2005

GENERAL PLAN LAND USE
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CAPACITY OVERVIEW
•CURRENT CAPACITY PER THE EXISTING WASTE
DISCHARGE REQUIREMENTS (WDR) IS 4.00

MGD AVERAGE FLOW
•CAPACITY IS SET BY THE STATE OF
CALIFORNIA’S REGIONAL WATER QUALITY

CONTROL BOARD (RWQCB)AND IS BASED ON

THE ABILITY OF THE PLANT TO PROCESS

WATER AND THE ABILITY TO DISPOSE OF THE

TREATED WATER THROUGH DELIVERY TO

BRIGANTINO PARK, SAN BENITO COUNTY

WATER DISTRICT, OR PERCOLATION PONDS
•CURRENT WASTE DISCHARGE REQUIREMENT
(PERMIT) THAT IS SPECIFIC TO THE HOLLISTER

DOMESTIC PLANT
•BEGINNING IN JUNE OF 2023, RWQCB

REQUIRED ALL WASTEWATER TREATMENT

PLANTS TO BE ON THE GENERAL PERMIT
•SAME PERMIT FOR EVERY TREATMENT PLANT

THAT IS ENROLLED WITH DIFFERENT SPECIFICS

DEPENDING ON THE WATER BASIN OR SUB
BASIN
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NEW WDR
•NEW WDR SETS AVERAGE DAY CAPACITY AT 3.40 MGD
•3.90 MGD MAX DAY
•LIMITED (DECREASED) BECAUSE OF UPDATES TO TWO MEMBRANE BIO-REACTORS (MBR) •THE TWO NEW MBRS ARE 1.70 MGD EACH AND THE TWO EXISTING MBRS ARE 1.00 MGD EACH •CANNOT RUN ALL FOUR MBRS AT ONCE
•UPDATES TO THE TWO NEW MBRS CREATE LACK OF COMMUNICATION/INTERACTION BETWEEN THE TWO

TECHNOLOGIES
•ONCE THE CITY’S WTP REACHES 90% OF CAPACITY (3.06 MGD), RWQCB WILL REQUIRE A CAPACITY STUDY TO EVALUATE THE NECESSARY IMPROVEMENTS REQUIRED TO HANDLE ANY FUTURE WASTEWATER FLOWS. 6MBR #1

1.70 MGD
MBR #2

1.70 MGD
MBR #3

1.00 MGD
MBR #4

1.00 MGD
Capacity = 3.40 MGD Capacity = 2.00 MGDOr
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CURRENT FLOW
•CURRENT FLOW IS 2.60 MGD (2022 ANNUAL REPORT)
•0.80 MGD (800,000 GPD) AVAILABLE FOR GROWTH
•AVERAGE OF 161 GALLONS PER SINGLE FAMILY RESIDENTIAL (SFR) •ALLOWS FOR GROWTH OF APPROXIMATELY 5,000 SFR HOMES
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PROJECTED INCREASES
•PROJECTED FUTURE FLOWS
•BALANCE OF 2.10 MGD PROJECTED PER 2018 SANITARY SEWER COLLECTION SYSTEM MASTER PLAN •PROJECTIONS BASED ON 2005 GENERAL PLAN LAND USE MAP
•TOTAL PROJECTIONS AT 4.70 MGD
•SAN JUAN BAUTISTA
•AVG. FLOW 0.16 MGD, AGREEMENT PROVIDES FOR 1.20 MGD MAXIMUM •AT LEAST ONE YEAR OUT DUE TO CONSTRUCTION IF APPROVED BY COUNCIL •NOT INCLUDED IN THE SANITARY SEWER COLLECTION SYSTEM MASTER PLAN PROJECTIONS OF 4.70 MGD •SAN JUAN OAKS
•CURRENTLY NO FLOW, AGREEMENT PROVIDES FOR 0.50 MGD MAXIMUM •CONNECTION PROJECTED IN WINTER 2023/SPRING 2024 IF APPROVED BY COUNCIL •NOT INCLUDED IN THE SANITARY SEWER COLLECTION SYSTEM MASTER PLAN PROJECTIONS OF 4.70 MGD 8 F.1.a
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OTHER CONSIDERATIONS
•CIELO VISTA
•76 HOMES CURRENTLY OPERATE THEIR OWN TREATMENT PLANT THAT IS FAILING •APPROX. $5.7M TO REPLACE THEIR TREATMENT PLANT (2021 ESTIMATES) •APPROX. $1.5M TO CONNECT TO CITY
•(2021 ESTIMATES)
•APPROX. 19K GALLONS PER DAY (GPD)
•FAIRVIEW CORNERS
•APPROX. 120 HOMES IN THE COUNTY ADDING ANOTHER 20K GPD •GAVILAN COLLEGE CAMPUS
•MINIMAL ADDITIONAL FLOW
•LANDS OF LEE SUBDIVISION
•2040 GENERAL PLAN IMPACTS
•REGIONAL HOUSING NEEDS ALLOCATION (RHNA) PLANNING GOALS •FUTURE ACCESSORY DWELLING UNITS
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CAPACITY SUMMARY

3.40 MGD
10 Origin Flow (MGD)Running Total Available
(new WDR)
Current Flow 2.60 2.60 0.80
Projected Future Flow
(Determined by 2018 Sanitary Sewer Collection System Master Plan based on land use identified in the 2005 General Plan)

2.10 4.70 -1.30
San Juan Bautista
(Initial Projected Influent)

0.16 4.86 -1.46
San Juan Oaks
(Initial Projected Influent)

0.18 5.04 -1.64
Cielo Vista 0.02 5.06 -1.66
Fairview Corners/Gavilan 0.02 5.08 -1.68
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MAXIMUM FLOW AND CAPACITY

3.90 MGD
11 Origin Maximum Flow (MGD)Running Total Available
(new WDR)
Current Maximum Flow 3.30 3.30 0.60
Projected Future Flow
(Determined by 2018 Sanitary Sewer Collection System Master Plan based on land use identified in the 2005 General Plan)

2.70 6.00 -2.10
San Juan Bautista
(Maximum per agreement)

1.20 7.20 -3.30
San Juan Oaks
(Maximum per agreement)

0.50 7.70 -3.80
Cielo Vista 0.02 7.72 -3.82
Fairview Corners/Gavilan 0.04 7.76 -3.86
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PROJECTED REVENUE
(BASED ON CURRENT FEE SCHEDULE)
•SAN JUAN BAUTISTA (IF APPROVED BY COUNCIL)
•$2,547,200 CONNECTION FEE
•TREATMENT IMPACT FEES RECEIVED PER FEE SCHEDULE AT TIME OF CONNECTION FOR ALL NEW DEVELOPMENT •SAN JUAN OAKS (IF APPROVED BY COUNCIL)
•TREATMENT IMPACT FEES RECEIVED PER FEE SCHEDULE AT TIME OF CONNECTION •INITIAL CONNECTION: WINTER 2023/SPRING 2024
•$50K TO REPLACE CONNECTION MANHOLE
•GAVILAN COLLEGE PROJECT (IF APPROVED BY COUNCIL)
•GAVILAN COLLEGE
•MINIMAL IMPACT FEES BASED ON USAGE PROJECTIONS
•CIELO VISTA
•APPROX. $660K IN 2023 IMPACT FEES
•FAIRVIEW CORNERS
•APPROX. $1.05M IN 2023 IMPACT FEES
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POTENTIAL OPTIONS TO ADDRESS CAPACITY
•INCREASE CAPACITY BY

UPGRADING ONE MBR
•INCREASE CAPACITY BY

UPGRADING TWO MBRS
13 •RETAIN EXISTING MBRS
•BUILDING MORATORIUM
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OPTION: INCREASE CAPACITY

BY UPGRADING ONE MBR
•UPGRADE ONE OLDER MBR WITH THE SAME TECHNOLOGY AS THE EXISTING TWO THAT HAVE BEEN UPGRADED •THIS COULD INCREASE CAPACITY TO 5.10 MGD
•OTHER IMPROVEMENTS MAY BE REQUIRED AS DETERMINED BY CAPACITY STUDY TO INCREASE CAPACITY •(E.G. PLANT HYDRAULICS, CHLORINE CONTACT BASIN, ETC.)
•UPDATING ONE OF THE OLDER MBRS WILL NOT CREATE REDUNDANCY FOR MAINTENANCE AND REPAIR ACTIVITIES •REQUEST INCREASE OF PERMITTED CAPACITY TO RWQCB-GENERAL PERMIT •WALLACE GROUP TO PERFORM A CAPACITY ANALYSIS TO VERIFY OVERALL SYSTEM CAPACITY •NOTE: CAPACITY OF 5.00 MGD OR ABOVE WILL REQUIRE CITY TO IMPLEMENT A INDUSTRIAL PRETREATMENT PROGRAM •PRELIMINARY COST ESTIMATES FOR REQUIRED STUDY AND IMPLEMENTATION RANGE FROM $100K -$500K

PROJECTED COST
•UPGRADE ONE MBR
•$1.25M (INCLUDES EQUIPMENT, INSTALLATION, START-UP, AND 20% CONTINGENCY) •WALLACE GROUP CAPACITY ANALYSIS & WASTEWATER TREATMENT MASTER PLAN •$105K
•REPLACE MANHOLES AT CONNECTION SITES (SJB & SJO)
•$100K
•FUNDING IS CURRENTLY AVAILABLE
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OPTION: INCREASE CAPACITY

BY UPGRADING TWO MBRS
•UPGRADE TWO OLDER MBRS WITH THE SAME TECHNOLOGY AS THE EXISTING TWO THAT HAVE BEEN UPGRADED •THIS COULD INCREASE CAPACITY TO 6.80 MGD
•OTHER IMPROVEMENTS MAY BE REQUIRED AS DETERMINED BY CAPACITY STUDY TO INCREASE CAPACITY •(E.G. PLANT HYDRAULICS, CHLORINE CONTACT BASIN, ETC.)
•UPDATING BOTH OF THE OLDER MBRS WILL CREATE REDUNDANCY FOR MAINTENANCE AND REPAIR ACTIVITIES •REQUEST INCREASE OF PERMITTED CAPACITY TO RWQCB-GENERAL PERMIT •WALLACE GROUP TO PERFORM A CAPACITY ANALYSIS TO VERIFY OVERALL SYSTEM CAPACITY •NOTE: CAPACITY OF 5.00 MGD OR ABOVE WILL REQUIRE CITY TO IMPLEMENT A INDUSTRIAL PRETREATMENT PROGRAM •PRELIMINARY COST ESTIMATES FOR REQUIRED STUDY AND IMPLEMENTATION RANGE FROM $100K -$500K

PROJECTED COST
•UPGRADE TWO MBRS
•$2.5M (INCLUDES EQUIPMENT, INSTALLATION, START-UP, AND 20% CAPACITY) •WALLACE GROUP CAPACITY ANALYSIS & WASTEWATER TREATMENT MASTER PLAN •$105K
•REPLACE MANHOLES AT CONNECTION SITES (SJB & SJO)
•$100K
•FUNDING IS CURRENTLY AVAILABLE
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OPTION: RETAIN EXISTING MBRS
•KEEP EXISTING MBR CONFIGURATION WHICH WILL KEEP PERMIT SET AT 3.40 MGD •COUNCIL WOULD HAVE TO DETERMINE IF SAN JUAN BAUTISTA AND/OR SAN JUAN OAKS

ARE ALLOWED TO CONNECT
•0.80 MGD AVAILABLE UNDER CURRENT GENERAL PERMIT
•COUNCIL CAN REVISIT REQUESTED MAX FLOWS FOR SAN JUAN BAUTISTA AND/OR SAN JUAN OAKS
•COUNCIL WOULD HAVE TO PROVIDE DIRECTION ON HOW TO ADDRESS PROPOSED

FUTURE CONNECTIONS UNTIL MAXIMUM CAPACITY IS MET
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OPTION: BUILDING MORATORIUM
•DETERMINE FEASIBILITY OF DECLARING A BUILDING MORATORIUM BASED ON DWWTP CAPACITY •UPDATE TO BE PROVIDED BY CITY OF HOLLISTER OUTSIDE COUNSEL •SOMACH, SIMMONS & DUNN
•RETURN TO COUNCIL FOR DISCUSSION AND POSSIBLE DIRECTION 17 F.1.a
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DOMESTIC WASTEWATER TREATMENT PLANT OPERATOR
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DWWTP OPERATIONS CONTRACT
CURRENT: VEOLIA WATER WEST OPERATING
SERVICES INC.
•VEOLIA OPERATES AND MAINTAINS
•CONTRACT: $1.4 MILLION IN FY2022-23
•$1.0M IN ANNUAL AVERAGE MAINTENANCE AND

REPAIRS PAID FOR BY THE CITY OF HOLLISTER
•REQUIRES GRADE V CHIEF OPERATOR
•HIGHEST GRADE IN CALIFORNIA
•REQUIRES GRADE III FOR DESIGNATED

OPERATOR-IN-CHARGE
•EXPIRES AUGUST 2, 2024
•OPTION FOR SIX YEAR EXTENSION
OPTION: CITY STAFFING
•REQUIRES SAME LEVELS OF CERTIFICATIONS AS

CURRENT OPERATOR
•CURRENT STAFF IS NOT CERTIFIED TO OPERATE
•ESTIMATED COST FOR PERSONNEL WITH
BENEFITS AT $1 MILLION ANNUALLY
•COULD BE DIFFICULT TO HIRE QUALIFIED

OPERATORS
19 OPTION: ISSUE RFP
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DWWTP OPERATIONS CONTRACT

OPERATOR OPTIONS
•ISSUE A REQUEST FOR PROPOSAL IN 2023-24 FOR PLANT

OPERATOR
•NEGOTIATE WITH VEOLIA TO EXTEND CONTRACT FOR SIX

ADDITIONAL YEARS AS PERMITTED IN CONTRACT
•PROVIDE SERVICE USING CITY STAFF

STAFF WILL BE RETURNING TO CITY COUNCIL IN NEAR FUTURE TO

PROVIDE A FULL REPORT ON OPTIONS
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BIO-SOLIDS HANDLING
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BIO-SOLIDS HANDLING

CURRENT
•CURRENTLY USING THE BELT PRESS TO

DEWATER SOLIDS CREATES CLASS B MATERIAL
•HAULED TO LANDFILL AFTER DEWATERING
•MUST UNDERGO FURTHER TREATMENT OR BE

LANDFILLED
•SB 1383 REQUIRES DIVERSION OF ORGANIC

MATERIAL FROM LANDFILL
FUTURE
•LONG TERM PLAN DEVELOPED BY KIMLEY-HORN

BEING REVIEWED BY WALLACE GROUP
•SEVERAL OPTIONS TO TREAT SOLIDS TO CLASS A
•CAN BE LAND APPLIED
•POSSIBLY SOLD TO OFFSET SOME COST
•(MINIMAL OFFSET)
•DIVERTS 100% FROM LANDFILL
•IMPROVEMENT COSTS RANGE FROM $7M-$14M
22Note: Bio-Solids Handling Improvements will not increase capacity level F.1.a
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UPCOMING ITEMS FOR COUNCIL CONSIDERATION
•JUNE 20, 2023 CITY COUNCIL
•SAN JUAN BAUTISTA AGREEMENT
•SAN JUAN OAKS AGREEMENT
•GAVILAN COLLEGE/CIELO VISTA/FAIRVIEW

CORNERS
•LANDS OF LEE SUBDIVISION
•WWTP OPERATOR CONTRACT
•WWTP CAPACITY ANALYSIS / MASTER PLAN
•WWTP OUT OF JURISDICTION SEWER SERVICE

REQUESTS
•BIO-SOLIDS HANDLING PROCESS
•ONSITE SOLAR BUYOUT @ APPROXIMATELY
$1.8M
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DISCUSSION AND POSSIBLE DIRECTION
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June 19, 2023
Honorable Mayor Casey and City Councilmembers
Via Email
Honorable Mayor Casey and City Councilmembers
City of Hollister
375 Fifth Street
Hollister, CA 95023
Re: Hollister City Council Meeting of June 20, 2023
Agenda Item F.1
Dear Mayor Casey and City Councilmembers:

I hope you all are well. I am writing you to continue my request to the City of Hollister that the City provide wastewater services and facilities to Sunnyslope Water District in order to honor the Agreements between the City and the District and to honor the "Will Serve Letters" provided to Gavilan College, Fairview Corners, and my property located at 291 Old Ranch Road (Lands of Lee), and to honor the agreements the City provided to San Juan Oaks.

I. SUMMARY
I understand that wastewater service is up for discussion by the City Council (Agenda Item F.1.), and therefore wish to add to the discussion. For the reasons set forth below, I respectfully submit that the City of Hollister lacks the legal authority to refuse the Sunnyslope Water District wastewater services to properties outside the City. The City and its City Council are legally bound to and by the 2007 and 2016 Agreements with the District, and therefore must serve new sewer users in the District (and outside the City) under the terns of those Agreements.

My property sits within existing District boundaries, and outside the City, and is subject to those 2007 and 2016 Agreements. I also have an agreement and Will Serve Letter from the District and a Will Serve Letter from the City promising water and wastewater services, as do Gavilan College, and Fairview Corners. Likewise, San Juan Oaks has a Will Serve Letter from the City.

It is my understanding these agreements all pre -date any considered arrangements with the City of San Juan Batista.

The City can easily provide the capacity to provide sewer service to all of us. The City has collected "fees," but has failed to spend those fees on maintenance. But the money is there to do the maintenance. The City can get the capacity back up quickly when it performs the maintenance that the City collected fees for, as required by law.

If the City refuses to follow the law, the agreements, and the arrangements it is bound to, then I and others will be directly and adversely impacted, and will be forced to seek all remedies available in law and equity.
i

June 19, 2023
Honorable Mayor Casey and City Councilmembers
Therefore, by this writing, I provide the City with the reasons why such denial is factually and legally prohibited. Additionally, I attach a memorandum from my attorney, Michael Patrick Durkee, that addresses these issues as well as related LAFCO issues.

II. DISCUSSION
A. Facts and Law.

There are two agreements between the City of Hollister and the Sunnyslope Water District relevant to the provision of wastewater and water services by the City and the District.

1. 2007 Agreement Between Sunnyslope and Hollister.

First, in 2007, the City and the District entered an agreement regarding the billing and collection of charges for properties within the City limits where the City provided wastewater services and the District provided water services (Billing and Collection Agreement dated April 16, 20079 ["2007 Agreement"]).

Under the 2007 Agreement, the City and District agreed that the District would bill for and collect wastewater charges on the City's behalf, and the District was authorized to retain a service fee before passing those collected charges to the City. (2007 Agreement, ¶¶ 4-5.)

2. 2016 Agreement Between Sunnyslope and Hollister.

Second, in 2016, the City and the District entered a similar agreement regarding properties outside of the City limits (Agreement dated August 15, 2016 ["2016 Agreement"]).

Under the 2016 Agreement, instead of the City providing wastewater services on its own behalf, the City acts as the District's "agent." (2016 Agreement, ¶¶l.01-1.02.) The District continues to bill and collect charges as it does under the 2007 Agreement, and to pass those charges on to the City. (2016 Agreement, ¶ 1.02.)
Section 1.01 of the 2016 Agreement expressly provides:
"l.01 As District's agent, City shall deliver sewer service outside the City limits, within the District's boundaries and on behalf of District, pursuant to and consistent with Government Code section 56133(e)(1)."[The LAFCO Law section that exempts such activity from LAFCO jurisdiction.] Emphasis added.

June 19, 2023
Honorable Mayor Casey and City Councilmembers
Agreement, 41 Paragraph ["Whereas, the Hollister Domestic Wastewater Plant has capacity to provide sewer service outside City limits..."].)
As between the City and the District, once a user outside the City limits connects to the City's wastewater system, the District must enroll that user for payment and bill and collect the charges from that user. (2007 Agreement, ¶ 3.2(d).) The premise underlying these two Agreements is that the City has the capacity and that the District can use that capacity whenever a user in the District's service area connects to the City's wastewater system. Because the City is only acting as the District's agent for service outside City limits, if the City lacks capacity to serve a new user, arguably it would be up to the District to obtain additional capacity. However, again, nothing indicates that the City lacks such capacity, and the 2016 Agreement makes clear in its recitals that the Hollister treatment plant has capacity to serve properties outside the City limits. (2016 Agreement, 411 Paragraph.)
As between the City and the District, including with respect to compensation to either party, neither the City nor the District has discretion to accept or reject, or otherwise condition, new sewer connections within the District's boundaries. The 2007 Agreement obligates the District to enroll for payment any new users who connect to the City's wastewater service.

Nothing in the 2007 Agreement nor the 2016 Agreement requires the District to "purchase capacity" to serve new connections to City's wastewater system. Instead, the District's only responsibility is to collect charges on behalf of the City and pay those charges (less the service fee) to the City. (2007 Agreement, ¶¶ 4-5; 2016 Agreement, ¶ 1.02.) As such, I respectfully request that the City Council direct the City Manager to work with the District to implement the terms and conditions of the 2007 and 2016 Agreements and provide Sunnyslope with the wastewater capacity it requests.

3. Will Serve Letters.

Sunnyslope Water District has the legal right to serve customers within its existing District boundaries. Additionally, Sunnyslope Water District has the legal right to call on the City to provide wastewater service to properties outside of the City but inside of the District's boundaries pursuant to the 2007 and 2016 Agreements. My property, located at 291 Old Ranch Road, lies within existing District boundaries. I have an agreement with the Sunnyslope County Water District to provide both water and wastewater services. I also have a "Will Serve Letter" from the District to provide water and wastewater services.

Additionally, consistent with the discussion above regarding the 2007 and 2016 Agreements, I have a "Will Serve" letter from the City of Hollister affirming that the City, as the agent of Sunnyslope, "conditionally approves providing sanitary sewer service to the development subject to all City conditions for providing the service, including, but not limited to, the preparation of all necessary sewer studies & reports, design, construction, and installation of 3 June 19, 2023
Honorable Mayor Casey and City Councilmembers
sanitary sewer infrastructure..." I am prepared to satisfy all of the conditions set forth in that City Will Serve Letter.

I have relied on the 2007 and 2016 Agreements and the "Will Serve" Letters provided by both Sunnyslope and the City of Hollister to my detriment. I have invested my life savings and my retirement savings into this project to try to provide desperately needed housing for low- income, moderate income, and the "missing middle" populations in this community. I have been a resident of San Benito County for over 30 years, and I operated a very large manufacturing and distribution business here. I met my wife of 25 years here. Both of my children were born and raised here. I currently operate a non-profit charitable food provider in this community.

I would ask that you consider two things in this process. There is a legal basis that obligates the City of Hollister to provide this wastewater service to these projects as outlined above. Additionally, there is a moral basis to step up and honor agreements and commitments made by the City. I am not an "out of town" developer. I am a local who has never developed a project before. I am simply trying to develop a project that gives this community something it badly needs.

As such, I respectfully request that the City Council direct City Staff to honor the "Will Serve Letters" provided to Gavilan College, Fairview Corners, San Juan Oaks, and my property located at 291 Old Ranch Road, and provide all of us with the wastewater capacity the City promised.

4. Failure to Use Collected Fees for Their Intended Purpose.

The City can easily provide the capacity to provide sewer service to all of us. The City has collected "fees," but has failed to spend those fees on maintenance. In other words, the money is there to do the maintenance. The City Council should direct that the fees be used to fund the maintenance that the City collected fees for, as required by law, so that capacity can be brought back quickly.

The Mitigation Fee Act - and the earlier California Constitutional, statutory, and federal and state caselaw decisions that brought it to fruition - makes clear that fees collected by the City must be justified, accounted for, and used for their intended purpose.

I hereby request the City to direct its Staff to conduct a full audit of, and accounting for, the fees, the status of needed maintenance, the shortfall — if any — between the amount of fees in the City's account and the cost of needed maintenance, so that we can secure an accurate assessment of the problem and the solution.
4 June 19, 2023
Honorable Mayor Casey and City Councilmembers
III. CONCLUSION
Thank you again for this opportunity to provide input on this issue. I appreciate your consideration on this matter, and I am happy to answer any questions you might have for me on this. I look forward to your discussion on June 20, 2023.

Respe lly submitted,
Bill Lee
Cc: City Manager
City Clerk
City Attorney
Michael Patrick Durkee, Esq.
5 CITY OF HOLLISTER
Send All Mail To:
375 Fifth Street • Hollister, CA 95023-3876
Phone: (831)636-4300 • Fax: (831) 6364310
October 30, 2019
Mr. Bill Lee
291 Old Ranch Road
Hollister. Ca.

Re: City of Hollister Wastewater Service to Proposed Lee Development at 291 Old Ranch Road
Mr. Lee:

The City of Hollister has received a request from Sunnyslope County Water District to provide sanitary sewer service, as an agent of District, to the above referenced development. Please be advised that the City of Hollister conditionally approves providing sanitary sewer service to the development subject to all City conditions for providing the service, including, but not limited to, the preparation of all necessary sewer studies & reports, design, construction, and installation of sanitary sewer infrastructure, all of which are subject to review and approval by the City Engineer. In addition, payment of all applicable fees in effect at the time of connection as specified by the City of Hollister is required.
:Sinc ely, i ,
is Avera
City Manager
CC: Danny Hillstock, City Engineer
Bryan Swanson, Development Services Director
Don Ridenhour, General Manager Sunnyslope County Water District Attach: October 21, 2019 Request for Sewer Service Letter from SSCWD

Sunnyslope County Water District
3570 Airline Highway
Hollister, California 95023-9702
October 21, 2019
William Avera, City Manager
City of Hollister
375 Fifth Street
Hollister, CA 95023
Phone (831) 637-4670
Fax (831) 637-1399
Re: Request City of Hollister Provide Wastewater Service to the Proposed 125 to 200 Lot Lee Development at 291 Old Ranch Road (APN 025-320-004)
Mr. Avera:

Mr. Bill Lee has requested wastewater service from the Sunnyslope County Water District for the 125 to 200 Lot Lee Development at 291 Old Ranch Road (APN 025-320-004). The proposed project is within the District's boundary, but within the City sewer service area according to Memorandum of Understanding — Hollister Urban Area Water and Wastewater Master Plan (HUAWWMP) executed in October 18, 2004 by the City, San Benito County, San Benito County Water District, and amended to include Sunnyslope County Water District on February 4, 2008. More recently on August 15, 2016, the District and the City entered into a Sewer Service Agreement specifying the City as the District's agent to provide sewer service outside the City limits and within the District's boundaries in compliance with and as intended by the HUAWWMP.

Sunnyslope County Water District is requesting the City provide sewer service, as the District's agent, to the Lee Development Project as intended by the HUAWWMP and the Sewer Service Agreement. The proposed development would be required to meet all the City conditions for providing this sewer service including infrastructure and fees as specified by the City. The District believes the agreements and this request is in accordance with Government Code Section 56133(e)(1) and is not subject to approval by the Local Area Formation Commission.

If the City requires or needs any additional information in order to respond to this request, please don't hesitate to contact me. The District looks forward to your response. Thank you.

Since 1 ,
ona d G. Ridenhour,00000
P.E.

General Manager
S:W D M 1 N R E N GWev iopnxnt Projects%ft - Otd Ranch Rd\L ee Project Sewer Sctvicc Request to City doc

To: Bill Lee File
From: Michael Patrick Durkee, Esq.

Date: June 5, 2023
I. FACTS & LEGAL DISCUSSION: LAFCO
A. LAFCO Facts and Law.

1. Sunnyslope County Water District.

LAFCO does not have the power to interfere with a contract between a private property owner such as Mr. Lee and a District such as the Sunnyslope County Water District, where the sole purpose of that contract is to provide an existing service (here, sewer and water service) to a property within the District's existing boundaries. As stated above, the Lee Property lays within the Sunnyslope County Water District, and Bill Lee has an executed agreement with the Sunnyslope County Water District to provide both sewer and water service.

Government Code section 56824.10 et seq. describes the narrow circumstances where LAFCO has authority to regulate services within an existing District's existing service boundaries: (1) when a district seeks to "provide a new or different function or class of services;" or (2) when a district wishes to divest its "power to provide particular functions or classes of services." Gov. Code § 56824.12. Neither of those situations are present here. Neither water service nor wastewater service is "new" to Sunnyslope County Water District, and Sunnyslope County Water District is not seeking to divest its "power to provide particular functions or classes of services." As such, LAFCO has no jurisdiction.

In other words, when an existing district, like Sunnyslope County Water District, is merely providing an extension of its existing services (water and wastewater) within its existing boundaries (which existing boundaries include the Lee Property), then LAFCO has no jurisdiction. Ceres v. City of Modesto, supra, 274 Cal.App.2d at p. 550; see also, South San Joaquin Irr. Dist. v. Superior Court, 162 Cal.App.41 146 (2008) [noting that the LAFCO law provides extensive procedures for extraterritorial service extensions, but not for service extension within a district's existing service area]. Sunnyslope County Water District is not providing a new class or service, it is merely providing its existing service to a property within its existing boundaries. LAFCO approval is not only not required, LAFCO lacks jurisdiction in this situation.

Indeed, the Act itself supports the position that LAFCO does not have authority to approve or disapprove the agreement between Mr. Lee and Sunnyslope County Water District. LAFCO Law expressly prohibits LAFCO from regulating land use and property development. See, e.g., Gov. Code § 56375(a)(6). Approving or conditioning new service connections falls squarely within this prohibition. While the County may exercise these powers, LAFCO cannot. See, Habitat & Watershed Caretakers v. City of Santa Cruz, 213 Cal.App.41' 1277, 1303-04 (2013) [LAFCO cannot impose conditions restricting the level of service provided].

In addition to violating the express LAFCO Law prohibition against regulating development, imposing a requirement for LAFCO approval in these circumstances defies logic and common sense. Such an interpretation would mean that every development project involving 1 To: Bill Lee File
From: Michael Patrick Durkee, Esq.

Date: June 5, 2023
a service connection to Sunnyslope County Water District within their existing service area would nonetheless require LAFCO approval. That is not what LAFCO law provides.

2. City of Hollister.

Again, Sunnyslope County Water District (not the City of Hollister) is in contract with Mr. Lee to provide water and sewer service. Sunnyslope County Water District has traditionally provided such water and sewer service to properties within its District boundaries, and the Lee Property is within Sunnyslope County Water District's existing boundaries.

To the extent that former LAFCO Executive Officer Bill Nicholson nonetheless believed that LAFCO has jurisdiction, because Sunnyslope County Water District provides sewage treatment to properties within its boundaries via contracts with the City of Hollister rather than contracts with the property owners LAFCO Law makes clear that former Executive Officer Bill Nicholson is incorrect. Government Code section 56133(a) requires LAFCO approval of contracts for service in limited circumstances. Specifically, that section provides "A city or district may provide new or extended services by contract or agreement outside its jurisdictional boundary only if it first requests and receives written approval from the commission [LAFCO]." Subdivisions (b) through (d) of Government Code section 56133 further set forth the rules and processes of such LAFCO approval.

Again, the Lee Property is not outside the jurisdictional service boundary of Sunnyslope County Water District. But for purposes of argument only, even if one were to proffer an argument that Sunnyslope County Water District's contract with Hollister somehow triggers approval under section 56133, subdivision (a), the exemption found in section 56133, subdivision (e) nonetheless prohibits LAFCO involvement:
(e) This section [requiring LAFCO approval] does not apply to any of the following:
(1) Two or more public agencies where the public .service to be provided is an alternative to, or substitute for, public services already being provided by an existing public service provider and where the level of service to be provided is consistent with the level of service contemplated by the existing service provider.

Gov. Code § 56133(e)(1).

The additional wastewater treatment capacity that Sunnyslope County Water District contracts for with the City of Hollister is clearly "an alternative to, or substitute for" the wastewater services already being provided by Sunnyslope County Water District, and the wastewater treatment service so provided by the City of Hollister "is consistent with the level of service contemplated by" Sunnyslope County Water District. Gov. Code § 56133(e)(1). The facts of this situation fit squarely within the exception set forth in Government Code section 56133(e)(1). LAFCO has no jurisdiction; LAFCO approval is not needed. 2 To: Bill Lee File
From: Michael Patrick Durkee, Esq.

Date: June 5, 2023

3. Other Arguments.

Lastly, former LAFCO Executive Officer Bill Nicholson argued that even though the Lee Property is within Sunnyslope's District boundaries, because Sunnyslope has never extended wastewater service to the area of the Lee Property, Mr. Nicholson argued that LAFCO approval was nonetheless needed. The former LAFCO Executive Officer based his requirement for LAFCO review on his unique interpretation of the definition of a "change of organization" which is one of the types of "applications" which the former Executive Officer stated "LAFCO is authorized to process under Government Code section 56017.2" (paraphrasing).

Mr. Nicholson stressed that Government Code section 56021 gives LAFCO jurisdiction in this case, italicizing what he believed to be the relevant portions of Section 56021:
"Change of organization" means any of the following: (a) A city incorporation. (b) A district formation. (c) An annexation to a city. (d) An annexation to a district. (e) A detachment from a city. (f) A detachment from a district. (g) A disincorporation of a city. (h) A district dissolution. (i) A consolidation of cities. 0) A consolidation of special districts. (k) A merger of a city and a district. (1) Establishment of a subsidiary district (m) The exercise of new or different functions or classes of services, or divestiture of the power to provide particular functions or classes of services, within all or a part of the jurisdictional boundaries of a special district as provided in Article 1.5 (commencing with Section 56824.10) of Chapter 5 of Part 3 of this division).

However, as stressed throughout the proceedings, Sunnyslope already provides water and wastewater services within its District boundaries. Therefore, the provision of wastewater service by the Sunnyslope County Water District to the Lee Property or any other property within Sunnyslope's existing District boundaries is not "(m) The exercise of new or different functions or classes of services, or divestiture of the power to provide particular functions or classes of services, within all or a part of the jurisdictional boundaries of a special district. " As such, LAFCO has no jurisdiction in this setting.

Additionally, as discussed below, the 2007 and 2016 Agreements between Hollister and Sunnyslope addressed and resolved the LAFCO jurisdictional issue. Section 1.01 of the 2016 Agreement expressly provides:
"1.01 As District's agent, City shall deliver sewer service outside the City limits, within the District's boundaries and on behalf of District, pursuant to and consistent with Government Code section 56133(e)(1)."[The LAFCO Law section that exempts such activity from LAFCO jurisdiction.] Emphasis added.
3 To: Bill Lee File
From: Michael Patrick Durkee, Esq.

Date: June 5, 2023
Former LAFCO Executive Officer Bill Nicholson was aware of the 2016 Agreement, was aware of its express provisions exempting the relationship between Sunnyslope and Hollister memorialized in the 2016 Agreement from LAFCO jurisdiction, and on behalf of LAFCO voiced his displeasure with those provisions — however, Mr. Nicholson did not bring the matter before the LAFCO Commissioners for discussion and did secure a LAFCO decision to challenge the 2016 Agreement in court.

The former Executive Officer's failure and LAFCO's failure to act in a timely manner on what the former Executive Officer perceived to be an unauthorized contract — and its interpretation that LAFCO has no jurisdiction - precludes LAFCO from raising the issue now.

The proper mechanism for LAFCO to challenge the 2016 Agreement was by writ under Code of Civil Procedure section 1094.5. Such a writ must be brought within 90 days of the challenged action — not seven years after the fact. Code Civ. Proc., § 1095.6. Even if LAFCO were to argue that Code of Civil Procedure section 1094.5 does not apply, claims challenging the formation or reorganization of cities and special districts (which former Executive Officer Nicholson argued occurred here) must be brought within six months of the change or reorganization. Code Civ.

Proc., § 359.1. Even other, more generous, statutes of limitation bar LAFCO's claims.

Allegations of statutory violations must be brought within three years. Code Civ. Proc., § 338.

Actions on contracts must be brought within 4 years, which is the same for actions without specific limitations statutes. Code Civ. Proc., §§ 337 and 343.

In other words, San Benito County LAFCO is at least three years too late to challenge the 2016 Agreement, which 2016 Agreement itself expressly makes clear that LAFCO has no jurisdiction pursuant to Government Code section 56133(e)(1).

Not only has too much time lapsed, but LAFCO has also waived its right to raise a challenge now. Former Executive Officer Nicholson's 2016 letter makes clear that LAFCO was aware of the 2016 Agreement and LAFCO's belief that the Agreement should have been presented to LAFCO for approval. Yet, LAFCO remained silent, tacitly allowing the City and the District to proceed under the 2016 Agreement's terms. By failing to act on the 2016 Agreement, LAFCO waived its right to later act on the 2016 Agreement and the Agreement's determination that LAFCO has no jurisdiction. Civ. Code, § 3513; Bickel v. City of Piedmont (1997) 16 Cal.41 1040, 1053.

In other words, the issue of LAFCO's jurisdiction over Sunnyslope's provision of wastewater service to property owners within Sunnyslope's District boundaries — including Mr.

Lee's property - was decided through the 2016 Agreement; LAFCO's failure to challenge that 2016 Agreement bars LAFCO from revisiting the issue now.

These are rights that Mr. Bill Lee holds. These rights cannot be surrendered by the City of Hollister, or by the Sunnyslope County Water District, or by LAFCO. 4 To: Bill Lee File
From: Michael Patrick Durkee, Esq.

Date: June 5, 2023
II. FACTS & LEGAL DISCUSSION: WASTEWATER PROVISION
UNDER THE 2007 AND 2016 AGREEMENTS
A. Facts and Law.

There are two agreements between the City of Hollister and the Sunnyslope County Water District relevant to the provision of wastewater and water services by the City and the District.

1. 2007 Agreement Between Sunnyslope and Hollister.

2. 2016 Agreement Between Sunnyslope and Hollister.

Second, in 2016, the City and the District entered a similar agreement regarding properties outside of the City limits (Agreement dated August 15, 2016 ["2016 Agreement"D.

Under the 2016 Agreement, instead of the City providing wastewater services on its own behalf, the City acts as the District's "agent." (2016 Agreement, ¶¶ 1.01- l .02.) The District continues to bill and collect charges as it does under the 2007 Agreement, and to pass those charges on to the City. (2016 Agreement, ¶ 1.02.)
As discussed above, Section 1.01 of the 2016 Agreement expressly provides that the relationship between the City and the District where the City, as the District's agent, shall deliver sewer service outside the City limits, within the District's boundaries and on behalf of District, is pursuant to and consistent with Government Code section 56133(e)(1) [again, the LAFCO Law section that exempts such activity from LAFCO jurisdiction], and LAFCO did nothing to challenge that 2016 Agreement and is now bound to its determinations.

Moreover, neither the 2007 Agreement nor the 2016 Agreement requires the District to take any steps to obtain capacity from the City. The 2016 Agreement makes clear in its recitals that the Hollister treatment plant has capacity to serve properties outside the City limits. (2016 Agreement, 411 Paragraph ["Whereas, the Hollister Domestic Wastewater Plant has capacity to provide sewer service outside City limits..."].)
5 To: Bill Lee File
From: Michael Patrick Durkee, Esq.

Date: June 5, 2023
As between the City and the District, once a user outside the City limits connects to the City's wastewater system, the District must enroll that user for payment and bill and collect the charges from that user. (2007 Agreement, ¶ 3.2(d).) The premises underlying these two Agreements is that the City has the capacity and that the District can use that capacity whenever a user in the District's service area connects to the City's wastewater system. Because the City is only acting as the District's agent for service outside City limits [citation], if the City lacks capacity to serve a new user, arguably it would be up to the District to obtain additional capacity.

However, again, nothing indicates that the City lacks such capacity, and the 2016 Agreement makes clear in its recitals that the Hollister treatment plant has capacity to serve properties outside the City limits. (2016 Agreement, 411 Paragraph.) As between the City and the District, including with respect to compensation to either party, neither the City nor the District has discretion to accept or reject, or otherwise condition, new sewer connections within the District's boundaries. The 2007 Agreement obligates the District to enroll for payment any new user who connects to the City's wastewater service.

Nothing in the 2007 Agreement nor the 2016 Agreement requires the District to "purchase capacity" to serve new connections to City's wastewater system. Instead, the District's only responsibility is to collect charges on behalf of City and pay those charges (less the service fee) to the City. (2007 Agreement, ¶¶ 4-5; 2016 Agreement, ¶ 1.02.) It is good that the City of Hollister and Sunnyslope County Water District are discussing wastewater provision to the Lands of Lee, Gavilan College, and Fairview projects. However, it should be made clear to both the City and the District that the 2007 and 2016 Agreements control, and that Mr. Bill Lee relied on those Agreements and the Will Serve Letters to his detriment. In short, the City of Hollister has no discretion to say "no" to Sunnyslope under the 2007 and 2016 Agreements.

III. CONCLUSION
LAFCO lacks jurisdiction over the provision of wastewater by Sunnyslope to properties within Sunnyslope's existing District boundaries, even when that service is provided by Hollister, as Sunnyslope's agent, through the 2007 and 2016 Agreements. To the extent LAFCO believes it has jurisdiction, that argument is time -barred.

Additionally, the City of Hollister lacks the legal authority to impose wastewater capacity charges on the District or to refuse the District wastewater services to properties outside the City.

Instead, the City and its City Council are legally bound to and by the 2007 Agreement and the 2016 Agreement, and therefore must serve new sewer users in the District (and outside the City) under the terms of those Agreements — i.e., the City is the agent for the District, the District collects the wastewater charges for the City, and the District is authorized to retain a service fee 0 To: Bill Lee File
From: Michael Patrick Durkee, Esq.

Date: June 5, 2023
before passing those collected charges to the City. (2007 Agreement, ¶¶ 4-5; 2016 Agreement, ¶

1.02.)

STAFF REPORT

CITY COUNCIL REGULAR MEETING AGENDA
MEETING DATE: JUNE 20, 2023
SUBMITTED: June 6, 2023
DEPARTMENT:

DEPARTMENT HEAD:

Community Services
William Via, Community Services
Director

TITLE OF ITEM: RESOLUTION NO. 2023-132, A RESOLUTION OF THE CITY COUNCIL OF

THE CITY OF HOLLISTER ADOPTING A WASTEWATER TREATMENT SERVICES

AGREEMENT BETWEEN THE CITY OF HOLLISTER AND THE CITY OF SAN JUAN

BAUTISTA AND APPROVING AN EASEMENT FOR CONSTRUCTION AND MAINTENANCE

BRIEF DESCRIPTION: City Council will consider adopting a Wastewater Treatment Services Agreement between the City of Hollister and the City of San Juan Bautista and approving an easement on the Wastewater Treatment Plant property for maintenance and placement of the sewer force main.

RECOMMENDATION: Adopt a resolution approving the wastewater treatment agreement between the City of Hollister and the City of San Juan Bautista to provide outside jurisdiction sewer service and approving an easement on the Wastewater Treatment Plant property for maintenance and placement of the sewer force main.

DEPARTMENT SUMMARY: Since 2019, the City of San Juan Bautista has been focused on resolving its wastewater violations with the United States Environmental Protection Agency (EPA) and State Water Board. On October 15, 2020, the San Juan Bautista City Council approved Resolution 2020-51, and agreed to two compliance projects from the analysis provided in the Preliminary Engineers Report: Alternative 3:

Regionalization with Hollister Domestic Waste Water Treatment Plant (DWWTP) and Off-Site Source Control West Hills Water Treatment Plant owned by the San Benito County Water District and operated by Sunnyslope County Water District.

The wastewater Compliance Project selected, and approved by the EPA, is defined as constructing a force main to export San Juan Bautista’s domestic wastewater to the Hollister DWWTP owned by Hollister and operated Veolia. It is preferable, according to policies of the Central Coast Regional Water Quality Control Board and other Governmental Authorities that, whenever possible, wastewater be treated at regional facilities so that the number of such facilities may be minimized

On September 7, 2021, Hollister and San Juan Bautista entered into a Memorandum of Understanding (MOU) regarding the parties’ agreement for San Juan Bautista to send domestic wastewater to Hollister DWWTP, and the MOU was amended by Addendum No. 1 to the MOU dated April 4, 2022. San Juan Bautista and Hollister staff have negotiated a cooperative agreement to replace the MOU with a permanent Agreement for the City of Hollister to accept and process San Juan Bautista’s domestic wastewater.

Additionally, an easement agreement was drafted and includes an easement for the construction and maintenance of the sewer force main on DWWTP property. Both agreements were approved at the May 13, 2023 meeting of the San Juan Bautista City Council.

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Furthermore, as of June of 2023, the State of California’s Regional Water Quality Control Board (RWQCB) required the City of Hollister’s Wastewater Treatment Plant to be on a general permit rather than a permit specific to the City of Hollister’s DWWTP, similar to all DWWTPs in the region. The General Permit is the same for every treatment plant that is enrolled with specific requirements depending on the water basin or sub water basin in the region. Capacity is set by the RWQCB and is based on the ability of the DWWTP to process wastewater and the ability to dispose of the treated water through delivery to Brigantino Park, San Benito County Water District, and percolation basins.

The previous permit per the waste discharge requirements (WDR) was set at 4.0 million gallons per day (MGD) average flow. The General Permit now sets the capacity at 3.40 MGD due to the configuration of the City’s new Membrane Bio-Reactors (MBR). In 2016, the City of Hollister upgraded two of its four MBRs. Each of the upgraded MBRs have the ability to process 1.70 MGD and the two existing MBRs have the ability to process 1.0 MGD. Since there are two set of MBRs with different technologies and means of communications, they do not have the ability to work in concert. One pair will provide for 3.40 MGD of treatment and the older pair will provide for 2.00 MGD of treatment. This has led to the RWQCB to reduce the permitted WDR from 4.00 to 3.40 MGD. Additionally, once the City’s DWWTP reaches 90% of capacity (3.06 MGD), the RWQCB will require the City to conduct a capacity study to evaluate the necessary improvements required to handle any future wastewater flows.

As per the City of Hollister’s 2022 Annual Report required by the RWQCB, the current annual flow is 2.60 MGD. In 2018, the Sanitary Sewer Collection System Master Plan was updated and based on the 2005 General Plan land use, the projected flow at build- out was estimated to be 4.70 MGD. The wastewater flows generated by the San Juan Bautista were not considered in Master Plan. The projected wastewater flows from San Juan Bautista range from an initial 0.16 MGD with a maximum flowrate of 1.20 MGD. If approved, it is estimated that the DWWTP could begin receiving wastewater flows within one year and is ultimately dependent on SJB’s construction schedule.

If approved, the City Council will need to make future improvements at the DWWTP to increase the capacity to accommodate for the full buildout of the project. The City must also anticipate that the RWQCB will require the City to conduct a capacity study in the future to evaluate the necessary improvements required to handle any future wastewater flows if approved.

FINANCIAL IMPACT: Initial conection fee of $2,547,200 connection plus the treatment portion of the City of Hollister’s monthly wastewater charges based on the number of connections will be paid to the City of Hollister. There will also be impact fees assessed for new development in San Juan Bautista based on the treatment portion of the current impact fees.

The City of Hollister will bear the potential costs associated with a capacity study and necessary improvements to increase capacity.

ATTACHMENTS:

1. Public Utility Easement Deed_SJB

2. Agmt for Domestic Wastewater Treatment & Disposal_SJB G.1
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3. 2021-09-07 MOU with San Juan Bautista

THIS REPORT WAS REVIEWED BY THE INTERIM CITY MANAGER WHO CONCURS WITH

THE STAFF RECOMMENDATION

David Mirrione, Interim City Manager

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RESOLUTION NO. 2023-132

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HOLLISTER ADOPTING A

WASTEWATER TREATMENT SERVICES AGREEMENT BETWEEN THE CITY OF

HOLLISTER AND THE CITY OF SAN JUAN BAUTISTA AND APPROVING AN EASEMENT

FOR CONSTRUCTION AND MAINTENANCE

WHEREAS, the City of San Juan Bautista has been working toward compliance with the United States Environmental Protection Agency and the State Water Board in regards to their waste water treatment plant violations; and WHEREAS, on October 15, 2020 the San Juan Bautista City Council approved a resolution for a compliance project that included regionalization with the Hollister Domestic Waste Water Treatment Plant (DWWTP); and

WHEREAS, said project consists of constructing a sanitary sewer force main to connect with the DWWTP; and

WHEREAS, it is preferable, according to policies of the Regional Water Quality Control Board and other Governmental Authorities that, whenever possible, wastewater be treated at regional facilities so that the number of such facilities may be minimized; and

WHEREAS, on September 7, 2021, Hollister and San Juan Bautista entered into a Memorandum of Understanding (MOU) regarding the parties’ agreement for San Juan Bautista to send domestic wastewater to the DWWTP; and

WHEREAS, SJB and Hollister staff have negotiated a cooperative agreement to replace the MOU with a permanent Agreement for the City of Hollister to accept and process San Juan Bautista’s domestic wastewater; and

WHEREAS, an easement is necessary to construct and maintain the force sewer main on DWWTP property; and

WHEREAS, the City of San Juan Bautista approved the permanent agreement for the City of Hollister to accept and process San Juan Bautista’s domestic wastewater at its May 13, 2023 City Council meeting; and

WHEREAS, the City of San Juan Bautista approved the easement agreement necessary to construct and maintain the force sewer main on DWWTP property at its May 13, 2023 City Council meeting; and

WHEREAS, the City will need to make future improvements to the DWWTP to treat Wastewater collected by San Juan Bautista; and

WHEREAS, the City must also anticipate that the Regional Water Quality Control Board will require the City to conduct a capacity study in the future to evaluate the necessary improvements required to handle any future wastewater flows; and

NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Hollister hereby adopts a Wastewater Treatment Services Agreement between the City of Hollister and the City of San Juan Bautista for the treatment of wastewater collected by G.1
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San Juan Bautista and conveyed to the DWWTP via a force main constructed at the expense of the City of San Juan Bautista.

BE IT FURTHER RESOLVED, that the City Council of the City of Hollister hereby grants an easement to the City of San Juan Bautista for the construction and maintenance of said force sewer main on City property.

PASSED AND ADOPTED, by the City Council of the City of Hollister at a Regular Meeting held this 20th day of June, 2023, by the following vote:

Mia Casey, Mayor
ATTEST:

Jennifer Woodworth, MMC, City Clerk

APPROVED AS TO FORM:

Lozano Smith Attorneys at Law

Mary F. Lerner, City Attorney

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I, JENNIFER WOODWORTH, MMC, City Clerk of the City of Hollister, do hereby certify that the attached Resolution No. 2023-132, is an original Resolution, or true and correct copy of a City Resolution, duly adopted by the Council of the City of Hollister at a regular meeting of said Council held on the 20th day of June, 2023, at which meeting a quorum was present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Hollister this City Council day of June, 2023.

Jennifer Woodworth, MMC

City Clerk of the City of Hollister
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MEMORANDUM OF UNDERSTANDING

SAN JUAN BAUTISTA CONVEYANCE OF DOMESTIC WASTEWATER TO

HOLLISTER FOR TREATMENT AND DISPOSAL
This MEMORANDUM OF UNDERSTANDING (MOU) is made and entered into on S6-et. -] )2021 by and between the CITY OF HOLLISTER ("CITY") and the CITY OF SAN JUAN BAUTISTA ("SJB").

RECITALS
WHEREAS, California Government Code Section 6502, authorizes public entities, including cities, counties and special districts to enter into agreements for their mutual benefit, and
WHEREAS, SJB's wastewater treatment plant was not designed to remove salt e.g., sodium, chloride, and total dissolved solids) from its domestic wastewater; and WHEREAS, SJB has for many years failed to meet local National Pollutant Discharge Elimination System ("NPDES") permit limits controlling the release of these constituents (sodium, chloride, and total dissolved solids) by discharging treated effluent with constituent concentrations above the effluent limitations specified in SJB's NPDES permit into a waterway of the United States (No Name Creek); and WHEREAS, on October 15, 2020, the City Council of San Juan Bautista adopted Resolution 2020-51, and pursuant to the SJB and United States Environmental Protection Agency ("EPA") Administrative Order on Consent, (executed August 8th, 2020), approved the selection of various compliance projects to bring its water and wastewater systems into compliance, and
WHEREAS, specifically the wastewater Compliance Project selected and approved by the EPA is defined as constructing a force main to export SJB's domestic wastewater to the City of Hollister's Domestic Wastewater Treatment Plant ("DWWTP"), owned and operated by the CITY (San Juan Bautista to Hollister Sanitary Sewer Force Main Project "SSFMP"); and
WHEREAS, the CITY's DWWTP was designed to serve the greater Hollister urban area, and it has now, and for the foreseeable future, the capacity to treat the wastewater generated from SJB; and
WHEREAS, the acceptance by the CITY of the SJB domestic wastewater will only occur if and when SJB can assure the City that the water quantity and quality of its domestic wastewater will in not adversely impact the City's ability to meet the regulatory mandates imposed by the Regional Water Quality Control Board; and WHEREAS, the diversion of approximately 160,000 gallons per day of SJB's domestic waste water from being discharged into a creek, to be being discharged to the 1 HOLLISTER-SAN JUAN BAUSTISTA FORCE MAIN MOU
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City's DWWTP for eventual re-use as agricultural irrigation is part of a multi-part water solution that will mutually benefit all County residents; and WHEREAS, this SSFMP will provide SJB with a much-needed permanent solution to remedy its wastewater treatment deficiencies, and de-commission its aged wastewater treatment plant; and
WHEREAS, by recycling and re-using the treated wastewater for agricultural irrigation, the SSFMP will further decrease the demand for groundwater for this purpose which will help to conserve the groundwater resources in the region for other uses, and for use during drought; and
WHEREAS, the CITY and SJB have a compelling and mutual interest in developing and implementing the San Juan Bautista SSFMP; and WHEREAS, the CITY and SJB want to ensure cooperation and mutual support for successful and cost-effective development and implementation of the SSFMP; and WHEREAS, the CITY and SJB wish to identify agreed-upon objectives for the development of the SSFMP and determining the feasibility thereof; and WHEREAS, the CITY and SJB wish to cooperate to ensure an adequate delivery of domestic wastewater to the CITY's DWWTP, and provide the benefits including the conservation of its groundwater from improved wastewater treatment directly to all consumers.

NOW, THEREFORE, BE IT UNDERSTOOD AND AGREED by CITY and SJB, as follows:

1. GENERAL
The foregoing recitals are true and correct, and incorporated herein.

2. SANITARY SEWER FORCE MAIN PROJECT (SSFMP)
A. The parties agree that the export of SJB domestic wastewater to the CITY will at no time jeopardize the integrity of, or compromise the quality of the CITY's wastewater effluent, its treatment process, or its State permit, now or in the future.

B. The parties intend to undertake the development of a comprehensive plan for exporting domestic wastewater collected from SJB to the CITY DWWTP. This plan is a single component of a four-part comprehensive Compliance Project agreed upon between the EPA and SJB, that also includes the import of surface water with lower salt concentrations to blend with its well water, the banning of domestic brine producing water softeners in SJB, tight controls over SJB's three industrial wastewater contributors that currently send their domestic wastewater to SJB, and if justified, the implementation of an industrial pretreatment program to monitor and regulate the receipt of this wastewater. 2 HOLLISTER-SAN JUAN BAUSTISTA FORCE MAIN MOU
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C. The comprehensive SSFMP for SJB shall identify specific alternatives to achieve the agreed upon objectives at the lowest practical lifecycle cost and earliest practical time. The SSFMP shall include a feasibility phase(s) and an implementation phase(s) resulting in the identification of the specific size, location and performance for physical facilities, project specific California Environmental Quality Act ("CEQA") and National Environmental Protection Act NEPA") compliance, a financing plan including required revenues for wastewater conveyance and treatment, assessments and connection/impact fees for CITY treatment, funding mechanism(s) (cash, grants, loans, bonds, etc.), and institutional arrangements and responsibilities (ownership, operations, maintenance, repair and replacement responsibility, etc.).

2.1.The SSFMP shall be based on the following principles:

2.1.1. SJB Resolution 2020-51 executed October 15, 2020 defines the Compliance Project" that is driving this MOU, guiding how and when SJB will reach compliance with the provisions described in the EPA's August 8, 2020, Administrative Order on Consent ("AOC") by December 21, 2023;

2.1.2. On February 16, 2021, the SJB City Council adopted Resolution 2021- 08, approving a Memorandum of Understanding ("MOU") with the San Benito County Water District ("SBCWD"), to explore the feasibility of importing treated surface water from the West Hills Water Treatment Plant for the blending of treated surface water and groundwater, to provide urban water users in SJB with uniform water quality, that will reduce the salt in the SJB's drinking water that is passed to the wastewater system, therefore acting as a critical component of the SJB solution to achieve compliance with the EPA's Administrative Order on Consent;

2.1.2.A. Surface water and groundwater supplies shall be managed to sustain the area water supply and manage groundwater levels to avoid negative impacts on overlying land uses;

2.1.2.B. Imported drinking water from SBCWD shall have a TDS concentration of not greater than 700 mg/L, Chloride concentrations averaging 80 mg/L and no greater than 90 mg/L, and a hardness of not greater than 150 mg/1 (measured as Calcium Carbonate). These concentrations will at no time exceed those limits placed upon SJB or the CITY by the Drinking Water Permit used by the State of California.

2.1.2.C. The SBCWD MOU also requires that within the urban water supply of the San Juan Bautista Urban Area, Zones 3 and 6, all wastewater shall be treated at the CITY DWWTP. San Juan Bautista General Plans and supporting public service plans and implementing Ordinances/Regulations shall be consistent with that requirement. 3 HOLLISTER-SAN JUAN BAUSTISTA FORCE MAIN MOU
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2.1.3. On April 20, 2021, SJB adopted Ordinance 2021-01, banning the use of domestic brine producing water softeners, more specifically banning all new brine producing water softeners from being installed and allowing existing systems to remain until the impacts of imported surface drinking water is in effect, at which time existing brine producing water softeners will also be banned.

2.1.4. SJB receives domestic wastewater from three industries, with which it has existing agreements extending its wastewater treatment services beyond its incorporated boundary, and Municipal Code Section 5-9, Uniform Wastewater Regulation," defines the legal policies to enforce an industrial pretreatment program:

2.1.4.A The agreements will be updated and brought into current force and effect, before any wastewater is exported to the CITY;

2.1.4.B If any or all of these industries qualify under the definition of Significant Industrial Users" then the pre-treatment program will be developed, applied, implemented and enforced;

2.1.4.C Any changes, additions, or deletions to these agreements, and consideration of any new industrial users being added to the system will first require approval by the CITY.

2.1.5. The quality and quantity of SJB domestic wastewater delivered to the CITY's DWWTP shall be as described herein.

2.1.5.A. The current Hollister Urban Area Water and Wastewater Treatment Agreement will be amended, renewed, and/or re-stated as deemed appropriate by the City, to include San Juan Bautista by incorporating the SJB Compliance Projects required by the EPA and govern the long-term relationships, and cost sharing responsibilities of the agencies.

2.1.6 The impacts of water supply and treatment and wastewater treatment and disposal (including reclamation) on the culture, economy and environment of the CITY and SJB shall be carefully evaluated and negative impacts minimized. The impacts considered shall be consistent with the parties' General Plan, and include, but not be limited to, impacts on air quality, surface water and groundwater quality and quantity, rates and charges including connection and impact fees, property values, industry and business preservation of agriculture and agricultural land and aesthetics.

2.1.7. Any action proposed by the CITY and SJB shall consider water and wastewater management to protect and sustain the local surface and groundwater supplies of San Benito County.
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2.2.The Parties further agree that the SSFMP shall be based on the following objectives and assumptions:

2.2.1. For the planning period mutually defined in the SSFMP, the capacity of the CITY DWWTP shall be capable of meeting 100% of the domestic wastewater demands, during wet, above normal, normal and dry years and in the first year of a critically dry period for the San Juan Bautista Urban Area and Hollister Urban Areas.

2.2.2. SJB's current average dry weather flow (ADWF) for wastewater treatment is approximately 160,000 gallons per day, based on 2019 and 2020 data.

The design flows from SJB's Wastewater Master Plan, adopted in November 2020, and the ongoing Amendment No. 1, list the projected flow estimates through the intermediate planning horizon of 2035, as well as the build-out of the 2015 General Plan though the Master plan applied growth projections from the City's current General Plan of 3% per year, which is substantially higher than has been experienced over the past 5-6 years. The most recent Association of Monterey Bay Area Governments AMBAG") projections used to create the Regional Housing Needs Assessment for SJB, estimate growth at only 1%.

The SJB General Plan is being amended to reduce growth from 3% annually to 1.9% and a more realistic SJB wastewater projection would be based on a 1.9% increase over the next 15-years. That would create a Peak Wet Weather Flow rate of approximately 1,400 gpm (gallons per minute) by 2035 with flows conveyed to Hollister equalized to approximately 800 gpm. Peak flows in SJB exceeding 800 gpm will be stored in SJB's existing 5.9 million gallons of wastewater treatment basins, which will be repurposed for this flow equalization function. Flow diverted to storage will be sent to the City when peak influent flows have reduced.

The maximum wastewater volume conveyed to the City will be limited to approximately 1.2 million gallons per day.
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Table 5.3 Wastewater Design Flows
1,1,1-e_'rater(via>ter PI an A n nddni nt No. 1
City Sar. l:.rar B.4 iti t;;
Design Flows
Average htasknurn Day Peak Hour
Existing and Projected Description Year Annual
Flows Dry Wet Peak Dry Peak Wet
Weather Weather Weather Weather
Flow Flow flow Flow
me) (mild) l lam) OW)
Existing 2020 Conditions 2020 0 16 0 28 0 40 0 51
Intermediate Planning Horizon
Focus of Master Plan
2035 0.26 0.46 0 65 0.82
Amendment
Butldout Horizon of General Plan
2020 Master Plan
2060 0 43 0 75 1 08 1 39
Projections
AK EL
6/15/2021

2.2.3 SJB is solely responsible for the SSFMP design, environmental impact mitigation, permitting and construction. The continued, managed use of the wastewater conveyance system is necessary to manage the collection and conveyance of SJB's wastewater and the responsibility to maintain these assets falls on SJB, up and until it reaches the first manhole in the CITY.

2.2.4 Centralized wastewater treatment is utilized at the CITY DWWTP to meet the minimum State limits for domestic wastewater treatment. Specialized treatment as required to produce reclaimed water for agricultural purposes and disposal by means other than reclamation shall be the CITY's responsibility and shall not be the responsibility of SJB.

2.2.5 The City will invoice SJB with a monthly flat rate and an annual "true- up" to occur each April for budget preparation purposes.

2.2.6 The Hollister/San Benito County Water District Agreement for recycled water will be extended to include SJB.

2.2.7 SJB will make improvements to and pay for the changes or upgrades needed at the Hollister collection (tie-in manhole) system to accommodate its connection to the system.

2.2.8 City will be added to the SJB SCADA system to allow it the ability to monitor flows from the SJB system.

2.2.9 Monitoring of the SJB wastewater quality will occur randomly and with the ability to complete continuous, 24-hour flow proportional sampling on a regular basis and will be shared with the City monthly, or upon request. 6 HOLLISTER-SAN JUAN BAUSTISTA FORCE MAIN MOU
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2.2.10 Hollister will update the DWWTP Waste Discharge Requirements with the Regional Board to reflect the SJB service arrangement.

2.2.11 The City has a 42-inch casing pipe installed across Highway 156 that is currently unused but may be used for a future capacity expansion. SJB will be allowed to use this casing until the City requires it and it is confirmed that there is not sufficient capacity for both the City and SJB, at which time SJB will be required to install its own Highway 156 crossing.

3. BUDGET AND FINANCIAL COMMITMENT
SJB commits to the CITY that it will bear the financial burden of the design, permit approvals and construction of this Project. If after 30% of the project is designed, SJB and the CITY decide the project is not feasible, the work will end, and all related commitments and agreements shall be terminated. If after the 30% design is completed, SJB and the CITY decide that the project is feasible and subsequently decide to move forward with the design and construction of the Project, the two parties agree to also move forward with a permanent long-term agreement with a term of not less than 10-years that will either be in the form of a new Agreement, or by amending and adding SJB to the existing Hollister Urban Area Water Supply and Treatment Agreement effective May 29, 2013.

3.1.1 It is estimated that approximately 800 new sewer clients (City EDUs) will be added to the Hollister system when this project is operational, entering the system through one connection. SJB will be sending an estimated equivalent of 994 equivalent dwelling units ("EDU") (one EDU equals 161 gallons [per the City of Hollister Wastewater Cost of Service and Rate Study, January 2018], or one single family home) of wastewater to the CITY DWWTP including domestic waste from SJB industrial clients, and will pay a one-time fee of$2,547,200.00(160,000 X

15.92) for this service. CITY agrees to amortize this cost for SJB over 30-years, at an interest rate equal to that assessed on the current Wastewater system debt (to be more specifically defined) being paid by the City, to be paid for and adjusted True-Up") annually each May 1st.

3.1.2 The CITY shall levy a monthly fee to SJB for treatment of its wastewater at a rate equal to treatment portion of the rate assessed for "single family residential" in Resolution 2017-296 (currently $80.38). The treatment portion of the monthly rate shall be determined as the ratio of the single-family residential sewer treatment impact fee to the total sewer impact fee (treatment plus collection).

It is estimated that the current portion of the rate that is attributable to the treatment of wastewater is $52.48 per EDU, of$80.83, to be adjusted as the City adopts new rates.

4. PAYMENT
Each Party shall bear its own policy (elected official), technical and management staff costs.

5. DATA, STUDIES AND RELATED INFORMATION
7 HOLLISTER-SAN JUAN BAUSTISTA FORCE MAIN MOU
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The Parties agree to all provide pertinent data, previous studies, and related information for the completion of the SSFMP. Specific data, previous studies and related information to be provided by the Parties is detailed in the WORK PLAN.

6. SEPARATE AGREEMENTS
No Party herein is obligated by this MOU to implement final design, financing, or construction of the SSFMP facilities. Any facilities proposed to implement the SSFMP shall be designed, financed, and constructed pursuant to separate agreements. Ownership and Operation, Maintenance, Repair and Replacement OMRB&R) responsibilities shall be subject to a separate agreement to be executed before any construction contract is awarded.

7. NOTICES
All notices relative to this MOU shall be given in writing and shall be personally served or sent by certified or registered mail and be effective upon actual personal service or depositing in the United States mail. The Parties shall be addressed as follows, or at any other address designated by notice:

CITY OF HOLLISTER
Brett Miller
City Manager
375 5TH Street
Hollister, CA 95023
Tel: 831.637.8218
Fax: 831.637.7267

CITY OF SAN JUAN BAUTISTA
Don Reynolds
City Manager
311 Second Street
PO Box 1420
San Juan Bautista, CA 95045
Tel: 831.623.4661
Fax: 831.623.4093

8. ENTIRE AGREEMENT
This MOU sets forth the entire Agreement among the Parties and supersedes all other oral or written representations. This MOU may be modified only in writing, approved by the Parties.

9. INDEPENDENT CONTRACTORS
This MOU calls for the performance of the service of SJB and the CITY as independent contractors. No Party is an agent or employee of any other Party for any purpose and is not entitled to any of the benefits provided by any Party to its employees. This MOU shall not be construed as forming a partnership or any 8 HOLLISTER-SAN JUAN BAUSTISTA FORCE MAIN MOU
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other association or agency among SJB and the CITY other than of independent contractors.

10.LIMITATION OF LIABILITY
No Party shall be liable to any other Party for any loss, damage, liability, claim or cause of action for damage to or destruction of property or for injury to or death of persons arising solely from any act or omission of the other Party's officers, agents, or employees.

11.CLAIMS
A Party against whom any claim arising from any subject matter of this MOU is filed shall give prompt written notice of the filing of the claim to all other Parties.

12.EFFECTIVE DATE
This MOU is effective upon duly authorized execution by all of the Parties. It is the product of negotiation and, therefore, shall not be construed against any Party.

13.TERMINATION
Any Party to this MOU may terminate its participation in the activities herein described upon:

1. Completion of the feasibility phase, or

2. Upon 90 days written notification to the other Party IN WITNESS HEREOF, the Parties hereto have caused this MOU to be executed, the day and year first-above written.

CITY OF SAN JUAN BAUTISTA CITY OF HOLLISTER
MAYOR LESLIE Q. J DAN MAYOR IGNACIO VELAZQUEZ
APPROVED AS TO FORM:APPROVED AS TO FORM:

OFFICE OF THE CITY ATTORNEY OFFICE OF THE CITY ATTORNEY JAA1A. 1)&cif5, `
a/`
By:
9 HOLLISTER-SAN JUAN BAUSTISTA FORCE MAIN MOU
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Page 1 of 2 ends

RESOLUTION NO. 2021-180

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HOLLISTER APPROVING

THE MEMORANDUM OF UNDERSTANDING FOR THE WASTE WATER COMPLIANCE

PROJECT WITH THE CITY OF SAN JUAN BAUTISTA
WHEREAS, for decades the City of San Juan Bautista has relied upon source water from wells, that is notoriously "hard," high in minerals, and includes a high level of salt; and WHEREAS, these wells are often subject to high nitrate levels causing them to be closed prematurely; and
WHEREAS, high salt levels being discharged into the creek currently exceed the National Pollution Discharge Elimination System ("NPDES") permit levels, causing a violation of the Permit; and
WHEREAS,following a June 2019 EPA inspection of the City of San Juan Bautista Treatment Plant and,for the past year, the City of San Juan Bautista has been working towards regaining compliance with its NPDES Permit enforced by the Environmental Protection Agency("EPA") and the Regional Water Quality Board; and
WHEREAS, in October 2019, the City of San Juan Bautista hired a project manager to assist with the development of a Water and Wastewater Master Plan and, during the process of completing these plans, it was determined that the high levels of salt being discharged into the creek at the Wastewater Treatment Plant are introduced from its source of ground water and passed through the Plant to the creek; and
WHEREAS, on April 20, 2020, the City of San Juan Bautista City Council appointed its Water Subcommittee consisting of Mayor Leslie Q. Jordan and Councilmember John Freeman; and WHEREAS, on August 8, 2020, the City of San Juan Bautista City Council adopted Resolution 2020-42, and the City of San Juan Bautista and EPA executed an Administrative Order on Consent ("AOC"), agreeing to resolve the City's NPDES violations by December 2023, setting forth a schedule by which certain milestones will be reached; and WHEREAS, on October 6, 2020, the City of San Juan Bautista City Council held a Town Hall meeting to discuss its options for solving the City's source water and wastewater compliance issues; and
WHEREAS, on October 15, 2020, as required by the AOC, the City Council approved Resolution 2020-51, and agreed to two compliance projects from the analysis provided in the Preliminary Engineers Report ("PER"): "Alternative 3: Regionalization with Hollister WWTP and Off-Site Source Control (Hollister Water Treatment Plant operated by the City of Hollister, and West Hills Water Treatment Plant operated by the San Benito County Water District);" and
WHEREAS, on February 1, 2021, the Hollister City Council received a presentation from City of San Juan Bautista to build a wastewater compliance that conveys its domestic wastewater by force main to Hollister, and they generally accepted the idea; and

CITY OF HOLLISTER
DUPL!'GA.TE OF ORIGINAL

ON FILE IN THE

OFFICE OF THE CITY CLERK
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Resolution No. 2021-180

Page 2 of 2 ends

WHEREAS, a draft MOU was then developed based upon a similar model used with the San Benito County Water District that unfolds in two parts, the first being a feasibility study based on drawings completed through 30%, and if it is determined to be feasible, the MOU allows for a path forward to a permanent agreement with conditions by which Hollister will accept San Juan Bautista's domestic wastewater; and
WHEREAS, the Subcommittee and the City of San Juan Bautista technical team evaluated the draft MOU, and have agreed upon its terms and conditions as described by the staff report submitted to the City of San Juan Bautista City Council to be included by reference in this Resolution; and
WHEREAS, the City of Hollister and City of San Juan Bautista's technical staff are in agreement that the MOU is ready to be considered for approval.

NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Hollister now hereby finds:

1. That the recitals in this Resolution and accompanying staff report are true and correct and are hereby made a part of this Resolution.

2. That the attached City of Hollister and City of San Juan Bautista Memorandum of Understanding is the correct course of action for the two agencies to take to initiate the work needed to determine the feasibility of exporting domestic wastewater from San Juan Bautista to Hollister.

3.That it approves the MOU as presented, authorizes the City Manager to make any minor edits or changes as needed consistent with its intent, and hereby authorizes the Mayor to execute the MOU.

PASSED AND ADOPTED, by the City Council of the City of Hollister at a Regular Meeting held this 7th day of September, 2021, by the following vote:

AYES: Council Members Perez, Resendiz, Burns, and Mayor Velazquez.

NOES: None.

ABSTAINED: None.

ABSENT:None.

Ignacio Velazquez, Mayor
ATTEST:APPROVED AS TO FORM:
f r`• Epperson Law Group PC
Christine Black, MMC, City Clerk L___-
Jaso . Ep son, City Attorney

CITY OF HOLLISTER

DUPLICF,TE OF ORIGINAL

ON FILE IN THE

OFFICE OF THE CITY CLERK
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I, CHRISTINE BLACK, MMC, City Clerk of the City of Hollister, do hereby certify that the attached Resolution No. 2021-180 is an original Resolution, or true and correct copy of a City Resolution, duly adopted by the Council of the City of Hollister at a Regular Meeting of said Council held on the 7th day of September, 2021, at which meeting a quorum was present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Hollister this 7th day of September, 2021.

Christine Black., MMC
City Clerk of the City of Hollister
Seal)
CITY OF HOL`CTER
DUFL:C,TE OF ORIGINAL
ON FILE IN TriE

OFFICE OF THE CITY CLERK
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MOU- WASTE WATER FORCE MAIN

SAN JUAN BAUTISTA MOU- WASTE WATER FORCE MAIN
February 1 Presentation to the Hollister City Council
Mandated- EPA Compliance project
MOU Sets fees, water volumes, and quality controls
Final Draft approved by Hollister technical staff
Final cost analysis, rate study, and funding applications await its approval
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MOU- WASTE WATER FORCE MAIN

SAN JUAN BAUTISTA MOU- WASTE WATER FORCE MAIN
Determined Final path for Force Main
Design will be 30% complete in October
Environmental Studies drafted for approval
Use of County Roads reduces cost
Design to be completed by December 2022
9-12 months to complete (goal is December 2023)
City to maintain competed lift stations, and force main G.1.c
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MOU- WASTE WATER FORCE MAIN

SAN JUAN BAUTISTA MOU- WASTE WATER FORCE MAIN
City pay 100% of Cost to design and build project
At 30%, if Project is not feasible, it will end (October/November) Subject to approval of Rate Increase
Rate Study has been drafted,
Rates have to meet potential funders' expectations
Funders Include: State Revolving Loan Fund, USDA, CDBG, ARP) G.1.c
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Design at Hollister Treatment Plant
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City plans to send 160,000 pergallonday
LtF sttciv.SAY Jine. City's new Waste Water Master Plan used toRa!n•.e project future growth at 1.9% per year
A small fraction of current use and total capacity
Leyerr
Stantec
Forcernain Pipeline Alignment Alternative-Detail
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QU EST ION S ?

THANK YOU
SAN JUAN BAUSTISTA IS VERY GRATEFUL!
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F.9

STAFF REPORT
too CITY COUNCIL REGULAR MEETING AGENDA
r ` MEETING DATE: SEPTEMBER 7, 2021
SUBMITTED: August 26, 2021 AGENDA ITEM: Introduction and Adoption of Resolutions and Ordinances
DEPARTMENT: City Manager CONTACT: Daisy Caceres, Senior Support DEPARTMENT HEAD: Brett Miller, City Manager Services Assistant 831-636-4300 x1010
TITLE OF ITEM: RESOLUTION NO. 2021-180, A RESOLUTION OF THE CITY

COUNCIL OF THE CITY OF HOLLISTER APPROVING THE MEMORANDUM OF

UNDERSTANDING FOR THE WASTE WATER COMPLIANCE PROJECT WITH THE

CITY OF SAN JUAN BAUTISTA
BRIEF DESCRIPTION: City Council will consider approving a Resolution which authorizes the Mayor to execute a Memorandum of Understanding ("MOU") to initiate the design of the wastewater compliance project between the City of Hollister and the City of San Juan Bautista.

RECOMMENDATION: Approve a Resolution authorizing the Mayor to execute a Memorandum of Understanding ("MOU") to initiate the design of the wastewater compliance project between the City of Hollister and the City of San Juan Bautista.

DEPARTMENT SUMMARY: Since February, several conversations have occurred between the City and with the staff at the City of San Juan Bautista. At the same time, the City of San Juan Bautista initiated the "basis of design" for the force main. During the first few months a "basis of design" was agreed upon that simplifies the work by eliminating most of the right-of-way acquisition and easements. The path of travel relies on existing County roads as much as possible, eliminating the need for 14 private easements to be negotiated. It defines where and how the City of San Juan Bautista will deliver its domestic waste water to the Hollister Waste Water Treatment Plant.

Waiting for these details to be flushed out, helped to inform the proposed Hollister MOU, and the City of San Juan Bautista's rate study that is being completed by Bartell Wells).

This preliminary work extended the goal to complete the 30% design plans from August to October, 2021.

Studying the City of San Juan Bautista system, Stantec has been helpful identifying the volume of water treated every day and Section 2.2.2 of the MOU includes an estimated volume of 161,000 gallons per day. This further permits the City of San Juan Bautista to negotiate with the industrial users based on their proportion of that volume. To be clear, this agreement is only concentrated on domestic wastewater, and the system is being designed to assure Hollister that it will be monitored 24/7 in the event an industrial user varies from this requirement. Table 5.3 from the Wastewater Master Plan is then relied upon to project future demands and effluent output.

In their negotiations, the November PER has been reduced by $2 million. Stantec and Bartell Wells have supported the City's efforts. In the PER Table 6.5, the "Connect Fee" to Hollister is estimated to cost $4.67 million. This includes the cost of wastewater collection and treatment. In Section 3.1.1 in the draft MOU, the cost is isolated to Packet Pg 431 c
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consider just treatment, reducing the PER to $2.547 million. This result work reduces rate increases for City of San Juan Bautista.

In summary, the MOU includes a lot or work based on current facts and system requirements. It informs the industrial users of the City of San Juan Bautista, to assure the City that the City of San Juan Bautista is designing a system that insists upon rigorous control over its largest customers. The City of San Juan Bautista financial planning required by the end of October, it is anticipated that the design will be 30% complete. At that time the Cities will discuss the project's feasibility. If it is determined to be feasible, the MOU will remain in effect until such a time that a permanent agreement is negotiated.

The permanent agreement will be similar to the "The Hollister Urban Area Water Supply and Treatment Agreement" executed in 2018, between the City of Hollister, Sunnyslope Water District and SBCWD for SBCWD to provide drinking water to the two parties from the West Hills Treatment Plant. This Agreement is the same tool being considered for San Juan Bautista. It is a longer-term agreement, that is permanent, sets the base rates for water, and assures the SBCWD will be able to recover its capital investment over time. In this way, the rate payers will not experience a big increase in their rates due to the cost of the project being spread over a long period of time.

FINANCIAL IMPACT: Approximately $2.547 million in impact fees.

CEQA: N/A
ATTACHMENTS:

1. MOU- SJB and COH

THIS REPORT WAS REVIEWED BY THE CITY MANAGER WHO CONCURS WITH

THE STAFF RECOMMENDATION
Brett Miller, City Manager
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STAFF REPORT

CITY COUNCIL REGULAR MEETING AGENDA
MEETING DATE: JUNE 20, 2023
SUBMITTED: June 6, 2023
DEPARTMENT:

DEPARTMENT HEAD:

Community Services
William Via, Community Services
Director

TITLE OF ITEM: RESOLUTION NO. 2023-133, A RESOLUTION OF THE CITY COUNCIL OF

THE CITY OF HOLLISTER ADOPTING A WASTEWATER TREATMENT SERVICES

AGREEMENT BETWEEN THE CITY OF HOLLISTER AND SAN JUAN OAKS MUTUAL

WATER COMPANY

BRIEF DESCRIPTION: City Council will consider adopting a Wastewater Treatment Services Agreement between the City of Hollister and San Juan Oaks Mutual Water Company for the properties located south of the Highway 156 and West of Union Road APNs 018 -190-023, 033, 034; 018-200-056, 057, 058; 021-140-046, 053, 054; 021-190-006, 017, 030, 031, 032; and 023-010-074, also known as the San Juan Oaks Specific Plan Project.

RECOMMENDATION: Adopt a resolution approving the Wastewater Treatment Services Agreement between the City of Hollister and San Juan Oaks Mutual Water Company to provide outside jurisdiction sewer service.

DEPARTMENT SUMMARY: In 2015, the City of Hollister received an application from project applicants Scott Fuller, San Juan Oaks, LLC and Greg Van Dam, Pulte Home Corporations to provide sewer service outside of the city’s jurisdictional boundaries and outside of the city’s sphere of influence and within the Hollister Urban Area Water and Wastewater Master Plan for the properties south of Highway 156 and west of Union Road.

On December 21, 2015, the City Council unanimously adopted Resolution 2015-232 (attached) which resolved that the city shall provide sewer service outside of its jurisdictional boundaries to the property located south of Highway 156 and west of Union Road, further identified as San Benito County Assessor' s Parcel Numbers 018-190-023, 033, 034; 018-200-056, 057, 058; 021- 140-046, 053, 054; 021- 190-006, 017, 030, 031, 032; and 023-010-074 upon LAFCO approval and it was further resolved that staff was to submit an application to the Local Agency Formation Commission of San Benito County (LAFCo) for said services. LAFCo authorized City to provide the Wastewater Treatment Services related to the Project and Mutual Service Area by Resolution No. 510 on February 25, 2016.

As of June of 2023, the State of California’s Regional Water Quality Control Board (RWQCB) required the City of Hollister’s Wastewater Treatment Plant to be on a general permit rather than a permit specific to the City of Hollister’s Domestic Wastewater Treatment Plant (DWWTP), similar to all DWWTPs in the region. The General Permit is the same for every treatment plant that is enrolled with specific requirements depending on the water basin or sub water basin in the region. Capacity is set by the RWQCB and is based on the ability of the DWWTP to process wastewater and the ability to dispose of the treated water through delivery to Brigantino Park, San Benito County Water District, and percolation basins.

MBRs with different technologies and means of communications, they do not have the ability to work in concert. One pair will provide for 3.40 MGD of treatment and the older pair will provide for 2.00 MGD of treatment. This has led to the RWQCB to reduce the permitted WDR from 4.00 to 3.40 MGD. Additionally, once the City’s DWWTP reaches 90% of capacity (3.06 MGD), the RWQCB will require the City to conduct a capacity study to evaluate the necessary improvements required to handle any future wastewater flows.

4.70 MGD. The wastewater flows generated by the San Juan Oaks project were not considered in Master Plan. The projected wastewater flows for the San Juan Oaks project range from an initial 0.18 MGD with a maximum flowrate at full buildout of 0.50 MGD. If approved, it is estimated that the DWWTP could begin receiving wastewater flows beginning winter 2023/spring 2024. The project developer has represented that the full build out could take five to ten years to complete.

Based on the City Council’s adoption of Resolution 2015-232, which authorized the City of Hollister to provide sewer services to this project, staff is seeking approval on a resolution adopting a Wastewater Treatment Services Agreement between the City of Hollister and San Juan Oaks Mutual Water Company.

FINANCIAL IMPACT: Receipt of approximately $4,500,000 in Wastewater Treatment Impact fees at full buildout plus monthly wastewater treatment charges based on monthly metered flow.

The City of Hollister will bear the potential costs associated with a capacity study and necessary improvements to increase capacity.

CEQA: N/A

ATTACHMENTS:

1. San Juan Oaks Wastewater Treatment Services Agreement_FINAL - SJOMWC Signed -

6.9.23 2. RESOLUTION NO. 2015-232

3. 02252016 LAFCO

4. LAFCO Minutes

THIS REPORT WAS REVIEWED BY THE INTERIM CITY MANAGER WHO CONCURS WITH

THE STAFF RECOMMENDATION

David Mirrione, Interim City Manager

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RESOLUTION NO. 2023-133

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HOLLISTER ADOPTING A

WASTEWATER TREATMENT SERVICES AGREEMENT BETWEEN THE CITY OF

HOLLISTER AND SAN JUAN OAKS MUTUAL WATER COMPANY

WHEREAS, in 2015 the City of Hollister received an application from project applicants Scott Fuller, San Juan Oaks, LLC and Greg Van Dam, Pulte Home Corporations to provide sewer service outside of the city's jurisdictional boundaries and outside of the city' s sphere of influence and within the Hollister Urban Area Water and Wastewater Master Plan for the properties south of Highway 156 and west of Union Road; and WHEREAS, at the December 21, 2015 City Council Meeting City Council approved Resolution 2015-232 authorizing the City of Hollister to provide sewer service outside of its jurisdictional boundaries and outside if the sphere of influence and within the urban service area water and wastewater master plan to the properties located south of the Highway 156 and West of Union Road APNs 018-190-023, 033, 034; 018-200-056, 057, 058; 021-140-046, 053, 054; 021-190-006, 017, 030, 031, 032; and 023-010-074 and directing staff to apply for the Local Agency Formation Commission (LAFCo) for Services; and

WHEREAS, the San Benito County Local Agency Formation Commission (LAFCo) authorized City to provide the Wastewater Treatment Services related to the Project and Mutual Service Area by Resolution No. 510 on February 25, 2016; and

WHEREAS, San Juan Oaks Mutual Water Company is a mutual water company that was formed to provide water and sewer services to its members, who will be the owners of improved properties within the Project known as the San Juan Oaks Specific Plan; and

WHEREAS, San Juan Oaks Mutual Water Company does not own a wastewater treatment plant, and it is preferable according to policies of the Central Coast Regional Water Quality Control Board and other Governmental Authorities that, whenever possible, wastewater be treated at regional facilities so that the number of such facilities may be minimized; and

WHEREAS, the City of Hollister owns and operates a Domestic Wastewater Treatment Plant (DWWTP), located at 2690 San Juan Hollister Road, Hollister, California, for the treatment of sewage collected from domestic and municipal sources; and

WHEREAS, the City will need to make future improvements to the DWWTP to treat Wastewater collected by San Juan Oaks Mutual Water Company from the Mutual Service Area; and

WHEREAS, the City will generate revenue to offset expenses of the DWWTP that would otherwise be borne by customers of the City Collection System.

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NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Hollister hereby adopts a Wastewater Treatment Services Agreement between the City of Hollister and San Juan Oaks Mutual Water Company for Wastewater Treatment services.

PASSED AND ADOPTED, by the City Council of the City of Hollister at a Regular Meeting held this 20th day of June, 2023, by the following vote:

Mia Casey, Mayor
ATTEST:

Jennifer Woodworth, MMC, City Clerk

APPROVED AS TO FORM:

Lozano Smith Attorneys at Law

Mary F. Lerner, City Attorney

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I, JENNIFER WOODWORTH, MMC, City Clerk of the City of Hollister, do hereby certify that the attached Resolution No. 2023-133, is an original Resolution, or true and correct copy of a City Resolution, duly adopted by the Council of the City of Hollister at a regular meeting of said Council held on the 20th day of June, 2023, at which meeting a quorum was present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Hollister this City Council day of June, 2023.

Jennifer Woodworth, MMC

City Clerk of the City of Hollister
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Wastewater Treatment Services Agreement
City of Hollister, California
and
San Juan Oaks Mutual Water Company
_____ , 2023
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CONTENTS

SECTION PAGE

1. STATEMENT OF PURPOSE AND INTENT .................................................................... 2

2. DEFINITIONS, INTERPRETATION AND MODIFICATION .............................................. 2

3. DESIGN OF THE CONNECTION INFRASTRUCTURE .................................................... 6

4. CONSTRUCTION OF THE CONNECTION INFRASTRUCTURE ........................................ 7

5. OPERATION OF INFRASTRUCTURE ........................................................................... 10

6. TREATMENT SERVICES ............................................................................................ 11

7. PAYMENT ................................................................................................................. 12

8. COORDINATION ........................................................................................................ 13

9. INSURANCE .............................................................................................................. 14

10. TERM ....................................................................................................................... 14

11. REPRESENTATIONS AND WARRANTIES..................................................................... 14

12. INDEMNIFICATION .................................................................................................. 16

13. DISPUTES ................................................................................................................. 17

14. DISPUTE RESOLUTION ............................................................................................. 18

15. GENERAL PROVISIONS ............................................................................................. 18

EXHIBITS

EXHIBIT A MAP OF PROJECT AND MUTUAL SERVICE AREA

EXHIBIT B MAP OF DOMESTIC WATER RECLAMATION FACILITY

EXHIBIT C CONNECTION INFRASTRUCTURE

EXHIBIT D REGULATIONS REGARDING THE SEWER COLLECTION SYSTEM OWNED BY MUTUAL

EXHIBIT E CITY SEWER RATE AND WASTEWATER TREATMENT RATE

EXHIBIT F POINTS OF CONTACT

EXHIBIT G FORM OF NOTICE OF ASSIGNMENT BY MUTUAL

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1 WASTEWATER TREATMENT SERVICES AGREEMENT
This Wastewater Treatment Services Agreement ("Agreement") is made and entered into as of _______________ , 2023 ("Effective Date"), by and between the City of Hollister, a California general law city ("City"), and San Juan Oaks Mutual Water Company, a California corporation ("Mutual"). City and Mutual are each a "Party" and collectively the "Parties".

RECITALS
(A) On November 3, 2015, the County of San Benito ("County") took certain actions in furtherance of a land development project known as the San Juan Oaks Specific Plan ("Project"), including the following: certification of a Subsequent Environmental Impact Report (State Clearinghouse No. 2013101006) by Resolution No. 2015-082; approval of General Plan Amendment No. 13-14 by Resolution No. 2015-084; adoption of San Juan Oaks Specific Plan by Resolution No. 2015085; amendment of the County Zoning Code and Zoning Map by Ordinance No. 941; and approval of a Development Agreement by Ordinance No. 942. The Project will be located in San Benito County, California, near the City of Hollister, as shown on Exhibit A. (B) Mutual is a mutual water company, as defined by California Corporations Code § 14300, and was formed to provide water and sewer services to its members, who will be the owners of improved properties within the Project, and limited other properties as shown on Exhibit A ("Mutual Service Area"). Also shown on Exhibit A is Sewer Pump Station #1 referenced for certain purposes in this Agreement (the "Pump Station"). (C) City owns and operates a Domestic Water Reclamation Facility ("DWRF"), located at 2690 San Juan Hollister Road, Hollister, California 95023, as shown on Exhibit B, for the treatment of sewage collected from domestic and municipal sources. The DWRF consists of an immersed membrane biological reactor, chlorination disinfection and associated facilities with a design capacity of 4,000,000 gallons per day ("GPD"), and produces tertiary recycled water in compliance with the Porter-Cologne Water Quality Control Act, California Water Code §§ 13000- 16104, the California Code of Regulations, Title 22, and Central Coast Regional Water Quality Control Board Order No. R3-2008-0069 (Master Reclamation Requirements for the City of Hollister Domestic Water Recycling Facility) ("Order"). (D) City owns and operates a sanitary sewage collection system for properties located within city limits and delivers that sewage to the DWRF for treatment and reuse ("City Collection System").
(E) The Mutual Service Area is located outside city limits, and thus, City will not own or operate the sanitary sewage collection system for the Project or other properties located within the Mutual Service Area. Instead, the sanitary sewage collection system for the Mutual Service Area will be owned and operated by Mutual.
(F) Mutual does not own a wastewater treatment plant, and it is preferable according to policies of the Central Coast Regional Water Quality Control Board and other Governmental Authorities that, whenever possible, wastewater be treated at regional facilities so that the number of such facilities may be minimized. City has available capacity in the DWRF to treat Wastewater collected by Mutual from the Mutual Service Area and desires to do so, in order to fully utilize the capacity of the DWRF and to generate revenue to offset expenses of the DWRF that would otherwise be borne by customers of the City Collection System.

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2 (G) The San Benito County Local Agency Formation Commission authorized City to provide the Wastewater Treatment Services related to the Project and Mutual Service Area by Resolution No. 510 on February 25, 2016.
(H) The Parties desire that City provide the Wastewater Treatment Services to Mutual on the terms and conditions set forth in this Agreement.

AGREEMENT
NOW THEREFORE, in consideration of the mutual promises, covenants, representations and warranties contained in this Agreement, the Parties hereby agree as follows:

1. STATEMENT OF PURPOSE AND INTENT
The purpose of this Agreement is to provide the terms and conditions pursuant to which City will provide the Wastewater Treatment Services to Mutual, and the respective obligations of the Parties therefor. In order to implement this purpose, the Parties shall use good faith to implement the terms of this Agreement and to accomplish the Wastewater Treatment Services.

2. DEFINITIONS, INTERPRETATION AND MODIFICATION

2.1 Definitions and Abbreviations. Capitalized terms used in this Agreement shall have the meanings set forth in the following sections.
(a) Agreement has the meaning set forth in the Preamble. (b) Applicable Law means any federal, state, local or other constitution, charter, statute, law, ordinance, treaty, compact, resolution, rule, regulation, order, specified standard or objective criteria contained in any applicable permit or approval, which standards or criteria must be met in order for the Sewer Infrastructure, Connection Infrastructure or DWRF to be constructed and operated lawfully, and other legislative or administrative action of any Governmental Authority, or a final decree, judgment or order of a court, or any applicable planning, engineering, construction or safety code. (c) Approvals means those approvals to be obtained from various Governmental Authorities. (d) BOD, i.e., biochemical oxygen demand, means the amount of oxygen required for bacteria and other microorganisms to decompose organic matter in the Wastewater under aerobic conditions at the Point of Connection, as measured in mg/L. (e) Business Day means any day other than Saturday, Sunday, New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Memorial Day, Independence Day, Labor Day, Veterans' Day, Thanksgiving Day, Day After Thanksgiving, Christmas Eve or Christmas Day. (f) Capacity Charge has the meaning set forth in Section 7.1. (g) Change in Law means that after the Effective Date of this Agreement, an Applicable Law is amended, modified, nullified, suspended, repealed, found unconstitutional or unlawful, or changed or affected in any material respect by any Applicable Law. Change in Law does not include changes in federal or state tax laws. Change in Law does include material changes in the interpretation of an Applicable Law.

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3 (h) City means the City of Hollister, California, a Party to this Agreement.
(i) City Collection System has the meaning set forth in Recital (D). (j) City Sewer Rate means the standard sewer rate charged by City to its commercial and industrial customers with low strength wastewater, as adopted by the City Council pursuant to Applicable Law and as updated from time to time. The City Sewer Rate as of the Effective Date is set forth in Exhibit E. (k) Commencement Date means the first date that Wastewater is produced from the Mutual Service Area and requires treatment by City using the Wastewater Treatment Infrastructure; provided, that the Commencement Date will not occur before the closing set forth in Section 4.7.
(I) Commercial Wastewater means non-toxic, non-hazardous wastewater from commercial facilities which is usually similar in composition to domestic wastewater, but which may occasionally have one or more of its constituents exceed typical domestic ranges, including discharge from commercial and institutional food service operations (like coffee shops and food vendors), commercial laundry facilities, animal holding facilities and beauty salons; provided, that toxic, hazardous or industrial wastes are not introduced into the Sewer Infrastructure.
(m) Connection Infrastructure means that infrastructure shown on Exhibit C, which is at or near the Point of Connection and accomplishes the transfer of Wastewater from the Sewer Infrastructure owned and controlled by Mutual to the Wastewater Treatment Infrastructure owned and controlled by City.
(n) County has the meaning set forth in Recital (A).
(o) CPUC means the California Public Utilities Commission. (p) Default has the meaning set forth in Section 13.1.
(q) Deficiency List has the meaning set forth in Section 3.3. (r) Design has the meaning set forth in Section 3.2.
(s) Dispute Resolution means resolution of a dispute between the Parties through settlement or mediation, as described in Section 14.
(t) Dispute Resolution Procedure means the procedures for Dispute Resolution set forth in Section 14.
(u) Due Date has the meaning set forth in Section 7.3.
(v) DWRF has the meaning set forth in Recital (C).
(w) Effective Date has the meaning set forth in the Preamble. (x) Emergency Event has the meaning set forth in Section 8.2. (y) FOG means fats, oil and grease in the Wastewater at the Point of Connection.

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4 (z) Force Ma eure means any cause beyond the reasonable control of the Parties hereto, including as applicable, an act of God, governmental restriction, shortage, failure or inability to secure materials or labor, strike, lockout, regulation, order, action or inaction of any Governmental Authority, war, civil disturbance, fire or unavoidable casualties. (aa) Governmental Authority means any international, national, federal, state, provincial, regional, county, municipal or local governmental, administrative, judicial or regulatory entity operating under any Applicable Law and includes any department, commission, bureau, board, administrative agency or regulatory body of any government. (bb) GPD has the meaning set forth in Recital (C).
(cc) Liability means any fine, penalty, damage, loss, cost, claim or expense or other liability, including any related attorney fees and expenses. (dd) Maximum Flow Rates has the meaning set forth in Section 6.2. (ee) malL means milligrams per liter, a scientific measurement of the concentration of a constituent in wastewater.
(ff) Mutual means San Juan Oaks Mutual Water Company, a Party to this Agreement, as further described in Recital (B), or any successor in interest to Mutual pursuant to Section 15.5.
(gg) Mutual Service Area has the meaning set forth in Recital (B). (hh) Notice to Cure has the meaning set forth in Section 7.4. (ii) Order has the meaning set forth in Recital (C).
(jj) Owner has the meaning set forth in Section 15.8.
(kk) Party or Parties means one or more of City or Mutual. (II) Performance Test has the meaning set forth in Section 4.4. (mm) Point of Connection has the meaning set forth in Section 3.1. (nn) Proceeding means any claim, suit, demand, cause of action, administrative investigation, allegation, arbitration, dispute or other action, process or proceeding whether actual or threatened.
(oo) Project has the meaning set forth in Recital (A).
(pp) Pump Station has the meaning set forth in Recital (B). (qq) Sewer Infrastructure means the sewage collection and conveyance infrastructure for the Project and Mutual Service Area. The Sewer Infrastructure shall include all service laterals, sewer mains, wet wells, pump stations, force mains and all Connection Infrastructure located upstream of the Point of Connection. (rr) Standards means those criteria for the design and construction of the Connection Infrastructure, including:
(i) City of Hollister Standard Specifications and Standard Plans; (ii) California Public Utilities Commission General Order 103-A; G.2.a
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5 (iii) San Benito County Sewer System Design Standards, San Benito County Code §§ 23.31.080 through 23.31.083;
(iv) Standard Specifications for Public Works Construction, prepared by the American Public Works Association, Associated General Contractors of California, Engineering Contractors Association and Southern California Contractors Association; and
(v) Applicable Law.
(ss) Subcontractor means any person or entity, other than Mutual's employees, engaged by Mutual to perform any work for Mutual under this Agreement, including the provision of services or the supply of goods or materials.
(tt) Termination Date has the meaning set forth in Section 10.1. (uu) TSS means the total suspended solids in Wastewater at the Point of Connection. (vv) Wastewater means wastewater flows from structures in the Mutual Service Area, including wastewater flows derived from toilets, showers, baths, sinks, dishwashers, clothes washers and similar domestic, commercial and institutional uses of water. Wastewater shall not include flows derived from any industrial facility or process, and shall not include stormwater flows, except stormwater that may enter the Sewer Infrastructure by infiltration or inflow.
(ww) Wastewater Treatment Infrastructure means those public works, improvements, structures, facilities and equipment owned by City in its collection, conveyance, treatment, reuse and disposal of wastewater, whether that wastewater was collected from areas within the City limits or is Wastewater from the Mutual Service Area.

Wastewater Treatment Infrastructure includes all infrastructure owned by City prior to the Effective Date and shall include that portion of the Connection Infrastructure downstream of the Point of Connection. Wastewater Treatment Infrastructure includes the DWRF.
(xx) Wastewater Treatment Rate means the City Sewer Rate in effect for the relevant period of Wastewater Treatment Services. As of the Effective Date, the Wastewater Treatment Rate shall consist of a monthly fixed charge plus a quantity charge based on Wastewater delivered to City at the Point of Connection, as shown in Exhibit E. If in the future City modifies the design of its City Sewer Rate, design of the Wastewater Treatment Rate shall be modified to match the modified City Sewer Rate.
(yy) Wastewater Treatment Services means the receiving at the Point of Connection, conveyance, treatment, reuse and disposal of Wastewater by City, using the Wastewater Treatment Infrastructure.

2.2 Interpretation. The provisions of this Agreement should be liberally interpreted to effectuate its purposes. The language of this Agreement shall be construed simply according to its plain meaning and shall not be construed for or against either Party, as each Party participated in the drafting of this Agreement and had the opportunity to have its counsel review the Agreement in detail. Whenever the context and construction so requires, all words used in the singular shall be deemed to be used in the plural, all masculine shall include the feminine and neuter, and vice versa. The word "including" means without limitation, and the word "or" is not exclusive. Unless the context otherwise requires, references herein: (i) to Sections and Exhibits mean the Sections of, and the Exhibits attached to, this Agreement; (ii) to an agreement, instrument or other document G.2.a
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6 means such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof and by this Agreement; and (iii) to a statute means such statute as amended from time to time and includes any successor legislation thereto.

2.3 Incorporation of Recitals and Exhibits. Recitals (A) through (H) set forth above and Exhibits
A through G attached hereto are hereby incorporated into, and made a part of, this Agreement.

2.4 Modification of Exhibits. The Parties acknowledge that the Connection Infrastructure is still
in a design phase, and the precise location and composition of the Connection Infrastructure may be slightly different than as depicted on the exhibits attached hereto. The Parties agree to cooperate in good faith to seek agreement upon, update and substitute modified exhibits as necessary to properly reflect the actual location and composition of the Connection Infrastructure once the final design of the Connection Infrastructure is complete.

2.5 Entire Agreement; Modification. This Agreement constitutes the entire agreement between
the Parties pertaining to the subject matter contained in it and supersedes all prior agreements, representations and understandings of the Parties. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by all of the Parties.

2.6 Severability. If any term, provision, covenant or condition of this Agreement shall be or
become illegal, null, void or against public policy, or shall be held by any court of competent jurisdiction to be illegal, null, void, against public policy or otherwise unenforceable, such term shall be modified or changed by the Parties to the extent possible to carry out the intentions and directives stated herein, or otherwise shall be severed. The remaining provisions of this Agreement shall remain in full force and effect and shall not be affected, impaired or invalidated thereby.

3. DESIGN OF THE CONNECTION INFRASTRUCTURE

3.1 Point of Connection. Mutual will deliver all Wastewater under this Agreement to City at the
point of connection ("Point of Connection"), which shall consist of a vertical plane perpendicular to the direction of flow of Wastewater, located at the intersection between the outside of the vertical wall of the transition sanitary sewer manhole and the gravity sewer main leading to the DWRF as shown on Exhibit C.

3.2 Design Review. Mutual shall be responsible for all actions required to prepare the engineering
and construction design of the Connection Infrastructure ("Design"). When Mutual has completed the 30 percent Design, and again when Mutual has completed the 90 percent Design, Mutual will provide a copy of such Design to the City point of contact designated on Exhibit F and give City at least fifteen (15) Business Days to review and approve such Design. City shall review the Design for purposes of: (i) ensuring compliance with the Standards; (ii) minimizing the cost of the Connection Infrastructure, considering capital, G.2.a
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7 operations, maintenance, repair and replacement costs; and (iii) enabling effective and efficient provision of the Wastewater Treatment Services, based on City's experience owning and operating the Wastewater Treatment Infrastructure.

3.3 Deficiencies. City shall either approve or communicate a list of deficiencies ("Deficiency List")
in the draft Design presented to City by Mutual as set forth in Section 3.2. City shall not unreasonably withhold or condition approval and shall provide its approval or Deficiency List within fifteen (15) Business Days of receiving the draft Design from Mutual. If City provides Mutual with a Deficiency List, representatives of the Parties shall meet and confer within ten (10) Business Days of delivery of the Deficiency List to Mutual to discuss resolution of the items on the Deficiency List. Following the meeting, Mutual shall correct the items on the Deficiency List upon which the Parties have agreed. Any disputes concerning the need for correction of items on the Deficiency List shall be resolved through the Dispute Resolution Procedures set forth in Section 14, except that the meet and confer set forth above shall satisfy the requirements of Section 14.1.

Once all items on the Deficiency List have been resolved, Mutual shall produce the final Design.

3.4 Modification of Design. The Parties acknowledge and agree that following City's approval,
the Design may need to be modified based on an event of Force Majeure, a Change in Law or discovery of a deficiency or unknown site condition during construction. To the extent that such modification would be the subject of Design changes according to common industry practices, Mutual shall make any required changes to the Design and provide a copy of such changes to City for its review and approval according to the process set forth in Section 3.2 and Section 3.3.

3.5 Coordination. Appropriate representatives of each Party shall meet when the other Party
requests a meeting to coordinate the planning, design and construction of the Connection Infrastructure.

4. CONSTRUCTION OF THE CONNECTION INFRASTRUCTURE

4.1 General Responsibilities. Following preparation of the Design pursuant to Section 3 of this
Agreement, Mutual shall be responsible for construction of the Connection Infrastructure (except for replacement of the manhole, which shall be governed by Section 4.9).

Mutual shall provide, furnish and perform, or cause to be provided, furnished and performed, all materials, consumables and utilities, supervision, labor and services required for the procurement, manufacturing, transport to the site, quality assurance, erection, construction, commissioning and performance testing of the Connection Infrastructure in accordance with the provisions of this Agreement. Mutual shall ensure that all construction is performed in a workmanlike manner by all of its employees and Subcontractors. If Mutual plans to arrange for the services of a general contractor for the construction of the Connection Infrastructure pursuant to this Section 4, Mutual shall provide City with a list of contractors that are prequalified to bid on the work, and within ten (10) Business Days City may strike contractors from such list, which power City shall exercise in a reasonable manner.

4.2 Specific Responsibilities. Without limiting the generality of Section 4.1 and subject to the
terms and conditions set forth in this Agreement, Mutual shall furnish, undertake, provide or cause to be furnished, undertaken or provided the following:

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8 (a) Procurement, supply and transportation to the site of the Connection Infrastructure of all materials necessary to construct the Connection Infrastructure;
(b) Supervision and direction of construction activities on the site of the Connection Infrastructure, including construction by Subcontractors, and coordination of the construction under this Agreement;
(c) Ensure that there are at all times at site when construction work is being performed suitably qualified and experienced personnel to supervise and perform such work; and
(d) Designate, by written notice to City, a representative who shall act as a single point of contact with City in all matters relating to construction of the Connection Infrastructure. The representative appointed by Mutual shall have full authority to act on behalf of Mutual for all purposes in connection with this Agreement.

4.3 Inspection. Subject to the terms and conditions set forth in this Agreement, Mutual shall
furnish, undertake, provide or cause to be furnished, undertaken or provided inspection services related to construction of the Connection Infrastructure. All work on the Wastewater Treatment Infrastructure, including the Connection Infrastructure, is subject to City inspection per City Standard Specifications. City shall have access to those portions of the site of the Connection Infrastructure then under Mutual's control, at reasonable times and upon reasonable notice. While at the site, City shall comply with all of Mutual's safety rules and other job site rules and regulations.

4.4 Performance Tests. Upon completion of construction of the Connection Infrastructure or any portion thereof, Mutual shall conduct operational performance tests (each a "Performance Test") to ensure that all components of the Connection Infrastructure as constructed satisfy the Standards.
(a) General. Development and implementation of Performance Test procedures will be the joint responsibility of Mutual and City. Mutual shall be responsible for providing all necessary labor, supervision, consumables, materials and equipment necessary to carry out properly each Performance Test. (b) Test Procedures. Performance Tests shall be conducted under normal operating conditions and in accordance with all Applicable Law in effect on the date thereof. Mutual may conduct the Performance Tests at such time that Mutual has complied with all provisions of this Agreement relating to the installation of all necessary components and systems or the portion of the Connection Infrastructure to be tested, except for completion of insulation, painting, final grading and any other portion of the Connection Infrastructure not affecting the operability, safety, mechanical or electrical integrity of the portion of the Connection Infrastructure being tested.
(c) Notice of Testing. Mutual shall notify City at least forty-eight (48) hours in advance of the date and time that Mutual proposes to start conducting a Performance Test. Mutual and City shall cooperate to identify a date and time for the Performance Test, and City shall be entitled to attend and oversee all portions of the Performance Test.

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9 (d) Repeat Performance Tests. If the Connection Infrastructure fails to satisfy an initial Performance Test, Mutual shall take, within a reasonable period, corrective measures necessary to eliminate the defects or deficiencies causing such failure, and to ensure that the Performance Test is satisfied by repairing or replacing the affected part of the Connection Infrastructure. Mutual shall, if so requested by City, submit to City for its review details of the corrective measures that it proposes to take. A Performance Test may be repeated as often as Mutual may elect. Without derogating from any of the foregoing, Mutual may, at its discretion, make any adjustments or changes to any system or section of the Connection Infrastructure which affects such system or section or any other systems or sections, and adjust such affected systems or sections accordingly as deemed necessary in order to meet or enhance the achievement testing goals or to repeat the Performance Tests.
(e) Disagreement as to Result of Tests. Following conduct of the last Performance Test, Mutual shall furnish to City written notification of the results of all Performance Tests performed for the Connection Infrastructure. In the event that City fails to provide to Mutual a written statement of objections to such results within five (5) Business Days of the notification, the aforementioned results shall be deemed accepted by City. If, as a result of the provision of the aforementioned statement, Mutual and City disagree on the interpretation of the results of the Performance Tests or Mutual's compliance with this Section 4.4 in conducting such Performance Tests, the dispute shall be referred to Dispute Resolution in accordance with Section 14.

4.5 Final Acceptance
(a) Final Acceptance Notice. After both of the following conditions have been met with respect to the Connection Infrastructure, Mutual shall submit to City the Final Acceptance Notice: (i) construction of the Connection Infrastructure is complete, and all Connection Infrastructure complies with the Design and Standards; and (ii) the Connection Infrastructure has satisfied the Performance Tests.
(b) Acceptance of the Infrastructure. Within ten (10) Business Days following receipt of the Final Acceptance Notice, City shall inspect the Construction Infrastructure and review all work and services performed by Mutual with respect thereto, and shall either: (i) notify Mutual in writing that the Connection Infrastructure is acceptable as constructed and certifying that the construction tasks have been fully satisfied for the Connection Infrastructure; or (ii) if reasonable cause exists for doing so, notify Mutual in writing that the Connection Infrastructure is not acceptable as constructed, stating in detail the reasons therefor. In the event that City determines the Connection Infrastructure is not acceptable as constructed, and Mutual has not disputed City's determination, Mutual shall promptly take such corrective action or perform such additional work or other services as will achieve acceptability of the Connection Infrastructure as constructed, and shall issue to City another Final Acceptance Notice. Such procedure shall be repeated until City has accepted the Connection Infrastructure as constructed. If City fails to respond to the Final Acceptance Notice within the time period set forth above, the Connection Infrastructure shall be deemed to be acceptable as constructed.
(c) Final Acceptance. Final Acceptance shall be achieved when the following events have all occurred: (i) City has accepted the Connection Infrastructure as G.2.a
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10 constructed, pursuant to Section (a) and Section (b); and (ii) all Approvals have been obtained in final and non-appealable form.

4.6 Construction Finance. Mutual shall be responsible for funding and financing all costs for
design and construction of the Connection Infrastructure. Mutual may utilize such financing as it, in its sole and absolute discretion, deems appropriate for purposes of the Connection Infrastructure, including the financing source and structure, interest rates, and other terms and conditions.

4.7 Closing. On a date to be agreed upon by the Parties, but in no event later than ten (10)
Business Days following Final Acceptance, Mutual shall transfer, convey and assign to City those portions of the Connection Infrastructure that comprise Wastewater Treatment Infrastructure, by bill of sale or other appropriate instrument. Following such transfer, conveyance and assignment, Mutual shall have all rights, privileges and obligations associated with ownership, operation and control of all Sewer Infrastructure upstream of the Point of Connection, and City shall have all rights, privileges and obligations associated with ownership, operation and control of all Wastewater Treatment Infrastructure downstream of the Point of Connection.

4.8 Warranty. Mutual warrants to City all of the following as of the closing set forth in Section 4.7: (a) the construction of all improvements to the Wastewater Treatment Infrastructure made pursuant to this Agreement shall conform in all material respects to the Design; (b) such Wastewater Treatment Infrastructure as constructed shall meet the Standards; (c) the construction of such Wastewater Treatment Infrastructure shall be of good quality, free from defects in workmanship and performed in a workmanlike and skilful manner; (d) all materials and other items incorporated in such construction shall be new and of a suitable grade of its respective kind for its intended use, be free from defects in material and workmanship, meet the requirements of the Design, and be free from any charge, encumbrance, lien or other security interest; and (e) title and ownership to such Wastewater Treatment Infrastructure shall pass to and vest in City, free and clear of any and all mortgages, liens, claims, charges, security interests, encumbrances and rights of other persons. Such warranties shall be effective for a period of one (1) year following the closing. The warranty and liabilities of Mutual under this Section 4.8 shall not extend to replacement of normal consumables or apply to any failure to comply with the warranty that has been caused by: (1) any erosion or derosion or normal wear and tear in operation of the Wastewater Treatment Infrastructure; (2) any failure of City or a third party, other than Mutual, to properly store, install, operate or maintain the Wastewater Treatment Infrastructure in accordance with good industry practices; (3) any modifications made to the Wastewater Treatment Infrastructure by any person other than personnel of Mutual without its express written consent prior to such modifications; (4) any neglect, abuse, malicious mischief, vandalism or event of force majeure affecting the Wastewater Treatment Infrastructure; (5) any negligent act of City; or (6) operation of the Wastewater Treatment Infrastructure outside the Wastewater Treatment Infrastructure's defined operation range.

4.9 Replacement of Manhole. City shall be responsible for replacement of the existing City manhole on the 36-inch trunk line located on the north side of San Juan Hollister Road and the sewer line crossing San Juan Hollister Road, if deemed necessary by City, as part of a larger City improvement project currently in the planning stages. In order to compensate City fully for that portion of such manhole replacement project made necessary by or related to the Project, Mutual will pay City the amount of Fifty Thousand Dollars ($50,000) within five (5) Business Days of the Effective Date.

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11 5. OPERATION OF INFRASTRUCTURE

5.1 Operation and Maintenance. Following the closing set forth in Section 4.7, both Parties shall have access to the Connection Infrastructure at all times for purposes of inspection, operation, maintenance, repair, replacement, improvement or expansion of the Sewer Infrastructure (for Mutual) or Wastewater Treatment Infrastructure (for City).

If a Party desires to undertake such actions in a manner that would disrupt operation of the Connection Infrastructure, delivery of Wastewater to or receiving of Wastewater at the Point of Connection, or provision of the Wastewater Treatment Services, that Party will inform the other Party with sufficient time for the Parties to meet and confer regarding the optimal approach to scheduling and conducting such actions, and neither Party will initiate such actions without agreement by the other Party or resolution according to the Dispute Resolution Procedure set forth in Section 14. Notice to each Party of operational issues should be to the points of contact listed in Exhibit F.

5.2 Sewer Infrastructure. The Parties acknowledge and agree that the Sewer Infrastructure will be designed and constructed to collect Wastewater from all residential, commercial and institutional properties within the Mutual Service Area and convey such Wastewater to the Point of Connection, for treatment by City as set forth in Section 6. Mutual shall be solely responsible for all actions related to design, construction, operation, maintenance, repair, replacement, improvement and expansion of the Sewer Infrastructure, except as otherwise provided in this Agreement.

5.3 Wastewater Treatment Infrastructure. The Parties acknowledge and agree that the Wastewater Treatment Infrastructure has been and will be designed and constructed to receive, convey, treat, reuse and dispose of wastewater from the City Collection System and the Sewer Infrastructure. City shall be solely responsible for all actions related to design, construction, operation, maintenance, repair, replacement, improvement and expansion of the Wastewater Treatment Infrastructure, except as otherwise provided in this Agreement.

6. TREATMENT SERVICES

6.1 Provision of Wastewater Treatment Services. Beginning on the Commencement Date, City will provide the Wastewater Treatment Services to Mutual. At least twenty (20) Business Days prior to the Commencement Date, Mutual shall provide written notice to City of that designation; provided, that the Commencement Date shall not occur before the closing set forth in Section 4.7.

6.2 Maximum Flow Rates. City shall accept deliveries of Wastewater from Mutual at the Point of Connection at rates up to 504,000 GPD or 400 gallons per minute, measured as set forth in Section 6.3 (the "Maximum Flow Rates"). The Maximum Flow Rates are based on the design flow of the Pump Station, and City has committed to provide Wastewater Treatment Services for Wastewater collected within the Mutual Service Area up to the Maximum Flow Rates. Without the prior written approval of City, Mutual will not: (i) enlarge, expand, modify or replace the Pump Station in a manner that would result in increasing the flow rate of the Pump Station above the Maximum Flow Rates; (ii) expand the Mutual Service Area beyond that shown on Exhibit A or previously approved by City; or (iii) collect and deliver to City any Wastewater from properties located outside the Mutual Service Area.

6.3 Measurement of Wastewater. All deliveries of Wastewater shall be measured using an appropriate flow meter located at the Pump Station as depicted on Exhibit A. The meter shall be calibrated at intervals deemed appropriate by Mutual, but no less frequently than recommended by the manufacturer or annually, and all such G.2.a
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12 calibrations shall be at the sole expense of Mutual. If City requests calibration of the meter at other times, Mutual shall arrange for the calibration within a reasonable period following the request; provided, that all expenses associated with such calibration shall be paid by City. Mutual shall provide City with notice prior to any calibration of the meter, so that personnel from City may observe the calibration. Mutual shall provide City with a copy of any report or other documentation following calibration of the meter.

6.4 Acceptance of Wastewater. City agrees to accept and treat all Wastewater collected by Mutual from the Mutual Service Area; however, City shall have the right to regulate and control the conditions under which Wastewater is accepted into the Wastewater Treatment Infrastructure as follows:
(a) Pretreatment Requirements. Mutual shall adopt and implement a pretreatment program for Wastewater collected from the Mutual Service Area and delivered to City at the Point of Connection, with requirements at least as stringent as what is required of the City Collection System. Mutual's pretreatment program may include requirements to install on-site pretreatment facilities, adopt specified wastewater management practices, conduct public outreach to customers, monitor wastewater flows from particular customers, and be subject to inspections by City pretreatment staff; provided, that such inspections shall be at City's discretion and expense.
(b) Sewer Use Regulations. Mutual shall prepare sewer use regulations, including restrictions on the discharge of fats, oil, grease and other materials by commercial and institutional properties into the Sewer Infrastructure, as may be reasonably necessary to meet the sewer inflow standards of City, attached as Exhibit D.
(c) Wastewater Constituents. Wastewater delivered by Mutual to City shall not exceed the following standards: (i) TSS of 160 mg/L; or (ii) BOD of 175 mg/L.

Through its staff, subcontractors or consultants, City shall have the right to collect and test samples of the Wastewater at the Pump Station at any reasonable time.

Such testing may be performed by City on a quarterly basis at the expense of Mutual; provided, that City may perform testing on a more frequent basis at City's own expense, except that testing more frequent than quarterly shall be at Mutual's expense during any period in which Wastewater exceeds the standards set forth in this Section 6.4(c).
(d) City Responsibility. Once Wastewater has passed the Point of Connection, City shall be solely responsible for treating and testing at its own expense the BOD, TSS, FOG and other regulated characteristics of Wastewater that is discharged into the Wastewater Treatment Infrastructure. For avoidance of doubt, Mutual shall not be responsible for compliance or regulatory requirements resulting from the City's treatment of the Wastewater at the Wastewater Treatment Infrastructure or any violations of Applicable Law originating from, or related to, the City Collection System.
(e) Approvals. City shall be responsible for obtaining, maintaining and complying with all Approvals required for operation, maintenance, repair, replacement, improvement and expansion of the Wastewater Treatment Infrastructure, including the Order and any amendments thereto or replacement orders issued following the Effective Date. Mutual shall provide information and support to City related to such Approvals, but Mutual shall not be required to construct or perform any changes or modifications to the Sewer Infrastructure.

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13 6.5 Reclaimed Water. The Parties acknowledge and agree that the Mutual Service Area will contribute to the effluent flows of the DWRF. Reclaimed water generated by the DWRF from the Mutual Service Area's Wastewater offers a resource that is valuable to the region.

City shall own all reclaimed water generated from the DWRF, including reclaimed water that was produced from Wastewater. Further, the Parties understand and acknowledge that as of the Effective Date, City has committed all reclaimed water from the DWRF to San Benito County Water District, and City will not be offering to sell any reclaimed water from the DWRF to Mutual, whether based on Wastewater received from Mutual pursuant to this Agreement or otherwise.

6.6 Liability for Wastewater. Mutual shall own, control and bear all responsibility and Liability for Wastewater upstream of the Point of Connection, and City shall own, control and bear all responsibility and Liability for Wastewater downstream of the Point of Connection. Mutual shall comply with Applicable Law related to its ownership and operation of the Sewer Infrastructure and all Wastewater upstream of the Point of Connection, including the preparation of a sewer system management plan and annual reporting to the Central Coast Regional Water Quality Control Board or other Governmental Authority. Upon request by City, Mutual shall provide City with a copy of any plan, report or other document filed with the Central Coast Regional Water Quality Control Board or other Governmental Authority.

7. PAYMENT

7.1 Payment Amount. Mutual shall pay City for the Wastewater Treatment Services based on the Wastewater Treatment Rate.

7.2 Tariffs. Mutual will be responsible for setting tariffs for wastewater collection services within the Mutual Service Area; provided, that Mutual will set its tariffs at a level sufficient to pay the Wastewater Treatment Rate to City. If Mutual assigns its rights and obligations under this Agreement to a sewer system corporation, as set forth in Section 15.5, then such assignee will adopt tariffs in compliance with the laws and regulations applicable to public utilities, as administered by the CPUC.

7.3 Billing. City shall invoice Mutual for all Wastewater Treatment Services on a monthly basis, showing the calculation of all amounts thereon in reasonable detail. An invoice that has been properly addressed and deposited in the United States mail, either to the address shown in Section 15.1, or to another address designated by Mutual in writing, shall be deemed to be presented to Mutual for payment. If both Parties agree in writing, electronic billing may be used, in which case the billing date is the date the invoice is sent electronically to the e-mail address designated in writing by Mutual.

Mutual's payment in full of the monthly invoice shall be due and payable to City thirty (30) days after deposit of the City invoice in the United States mail or the invoice is sent electronically to Mutual ("Due Date"). City shall send a secondary invoice to Mutual for any bill not paid by the Due Date. In the event the invoice is past due more than sixty (60) days after the Due Date, the City may charge interest on any past due invoice at the rate applied to other City customers, for every month or portion of a month that the past due amount remains unpaid.

7.4 Suspension of Wastewater Service for Non-Payment. If a past due invoice remains unpaid
more than ninety (90) days after the Due Date, the City shall give final written notice and opportunity to cure to Mutual ("Notice to Cure"). If any past due amounts remain unpaid after the Notice to Cure in accordance with the timelines set forth in Section 13.1, the City may suspend the provision of Wastewater Treatment Services to Mutual and take any physical action needed to effect such suspension, including plugging of the force G.2.a
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14 main leading to the Point of Connection, until such payment has been received. City will give Mutual at least forty-eight (48) hours prior written notice regarding the date and time Wastewater Treatment Services will be suspended. City will not be responsible for any consequential damages Mutual or its customers may incur because of suspension of Wastewater Treatment Services pursuant to this Section L4. City shall not have an obligation to resume Wastewater Treatment Services following suspension, unless and until Mutual brings its account current.

7.5 Disputed Invoices. In the event that Mutual disagrees with any invoice, Mutual shall provide
notice to City of such disagreement prior to the Due Date for such invoice, along with the reason or reasons for such disagreement and reasonable details related thereto. Mutual shall pay any undisputed amounts pursuant to Section 7.3. Any disagreement related to an invoice will be resolved according to the Dispute Resolution Procedure.

7.6 Impact Fees. The Parties acknowledge that Owner will pay to the City any impact fees related
to sewer treatment, as follows: any impact fees shall be due and payable to the City at the time of the issuance of building permits for each structure to be constructed within the Project; the applicable impact fees will be those adopted by the City and in effect on the date due and payable by Owner to the City; and any impact fees will relate to sewer treatment and not include any impact fees related to sewer collection. SJO Mutual will not be responsible for the payment of any impact fees to the City, but shall confirm that all impact fees have been paid by Owner prior to commencing sewer services to any customer within the Project.

8. COORDINATION

8.1 Operation and Maintenance Activities. The Parties agree and acknowledge that there is a
potential for maintenance activities conducted by City or Mutual to cause temporary operational impacts within the Sewer Infrastructure or Wastewater Treatment Infrastructure. The Parties shall work together to implement measures that mitigate or minimize operational impacts.

8.2 Emergency Event. The Parties shall coordinate responses to unplanned events that may
impact operations of the Connection Infrastructure, Point of Connection, flow of Wastewater, Wastewater Treatment Services, Sewer Infrastructure or Wastewater Treatment Infrastructure. When either Party becomes aware of an issue that requires immediate attention to avoid operational impacts (each an "Emergency Event"), it shall:
(a) Investigate to identify possible sources of the issue within a response time consistent with their standard operating procedures;

(b) If it is determined that the Party aware of the issue is the responsible Party, it shall mitigate the issue as necessary to remedy the issue; (c) If it is suspected that the other Party may be responsible for the issue, the Party aware of the issue shall immediately contact the other Party; and
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15 (d) Until the responsible Party is agreed upon by City and Mutual, both Parties shall remain engaged in finding a solution and work collaboratively to resolve any issues.

8.3 Access to Facilities. The Parties shall allow reasonable access to each other's facilities, subject to the operational limitations of the facility owner. Access to facilities shall be requested through the points of contact listed in Exhibit F. In case of an Emergency Event, a representative for each Party shall be available at all hours.

8.4 Data Acquisition. The Parties may request existing data and information for planning, monitoring or operational purposes from each other. This data and information (excluding any
privileged data or information) shall be made available within a reasonable timeframe.

9. INSURANCE

9.1 General Liability. Mutual will acquire and maintain commercial general liability insurance for the period from the commencement of construction of relevant portions of the Connection
Infrastructure through the Commencement Date, at levels appropriate for the industry.

9.2 Other Insurance. Each Party, at its sole cost and expense, shall carry insurance or shall self-insure its activities in connection with this Agreement and obtain, keep in force, and maintain insurance or equivalent programs or self-insurance for general liability and property adequate to cover its potential liabilities hereunder. Each Party agrees to provide the other Party thirty (30) days' advance written notice of any change, cancellation, termination or lapse of any of the insurance or self-insurance coverage.

10. TERM

10.1 Effective Period. This Agreement shall be in effect from the Effective Date in perpetuity thereafter, unless terminated based on occurrence of the circumstances set forth in Section 10.2 or Section 10.3.

10.2 Termination by Agreement. This Agreement shall be subject to termination based on mutual agreement of the Parties.

10.3 Material Default by Mutual. This Agreement shall be subject to termination based on material Default by Mutual, as set forth in a final, nonappealable judgment of a court of competent jurisdiction; provided, that such right of termination shall be considered an equitable remedy and subject to the limitations of Applicable Law thereon, including the insufficiency of an adequate remedy at law.

11. REPRESENTATIONS AND WARRANTIES

11.1 By City. City makes the following representations, warranties and covenants to Mutual as of the Effective Date:
(a) Qualification and Power. City possesses all requisite power and authority to enter into this Agreement and to perform its obligations hereunder and to consummate the transactions contemplated hereby.

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16 (b) Authority. The execution, delivery and performance of this Agreement and any related agreements expressly contemplated hereby, and the consummation of the transactions provided for by this Agreement, have been duly authorized by City. This Agreement, when executed by the Parties, will be a valid and binding obligation of City, enforceable in accordance with the terms set forth herein. Neither the execution nor performance of this Agreement will conflict with, or result in a breach of, any Applicable Law. To the best of City's knowledge, no consent or approval by, or any notification of or filing with, any Governmental Authority is required in connection with the execution or performance of this Agreement.
(c) Compliance. Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby, will result in the breach of any term or provision of, or constitute a default under, any organizational document, agreement, indenture, instrument or Applicable Law, or any order, judgment or decree to which either City is a party or by which City is bound. (d) Litigation. To the best of City's knowledge, there are no actions, suits, claims, investigations or legal, administrative or arbitration proceedings pending or threatened against City with respect to the Wastewater Treatment Infrastructure, the Order or the subject matter of this Agreement, whether at law or in equity, whether civil or criminal in nature, or before or by any federal, state, municipal or other Governmental Authority, nor does City know of any basis therefor. There are no outstanding or unsatisfied judgments, decrees, injunctions or orders of any court, government department, commission, agency, instrumentality or arbitrator against City with respect to the subject matter of this Agreement.
(e) Disclosure. To the best of City's knowledge, no representation or warranty by City contained in this Agreement, nor any statement furnished or to be furnished by City to Mutual pursuant to this Agreement contains or shall contain any untrue statement of a material fact.

11.2 By Mutual. Mutual makes the following representations, warranties and covenants to City as of the Effective Date:
(a) Qualification and Power. Mutual possesses all requisite power and authority to enter into this Agreement and to perform its obligations hereunder and to consummate the transactions contemplated hereby.
(b) Authority. The execution, delivery and performance of this Agreement and any related agreements expressly contemplated hereby, and the consummation of the transactions provided for by this Agreement, have been duly authorized by Mutual. This Agreement, when executed by the Parties, will be a valid and binding obligation of Mutual, enforceable in accordance with the terms set forth herein. Neither the execution nor performance of this Agreement will conflict with, or result in a breach of, any Applicable Law. To the best of Mutual's knowledge, no consent or approval by, or any notification of or filing with, any Governmental Authority is required in connection with the execution or performance of this Agreement.
(c) Compliance. Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby, will result in the breach of any term or provision of, or constitute a default under, any organizational document, agreement, indenture, instrument or Applicable Law, or any order, judgment or decree to which either Mutual is a party or by which Mutual is bound.

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17 (e) Litigation. To the best of Mutual's knowledge, there are no actions, suits, claims, investigations or legal, administrative or arbitration proceedings pending or threatened against Mutual with respect to the Sewer Infrastructure, the Project, the Mutual Service Area or the subject matter of this Agreement, whether at law or in equity, whether civil or criminal in nature, or before or by any federal, state, municipal or other Governmental Authority, nor does Mutual know of any basis therefor. There are no outstanding or unsatisfied judgments, decrees, injunctions or orders of any court, government department, commission, agency, instrumentality or arbitrator against Mutual with respect to the subject matter of this Agreement.
(f) Disclosure. To the best of Mutual's knowledge, no representation or warranty by Mutual contained in this Agreement, nor any statement furnished or to be furnished by Mutual to City pursuant to this Agreement contains or shall contain any untrue statement of a material fact.

11.3 Cure. Each Party shall promptly notify the other Party of the occurrence of any event claimed to constitute a breach of any representation, warranty or covenant in this Agreement. The Party receiving a claim that it is in breach of a representation, warranty or covenant in this Agreement shall be entitled to cure any such breach pursuant to the terms of Section 13.1.

12. INDEMNIFICATION

12.1 Indemnity by City. To the fullest extent permitted by Applicable Law, City shall defend, indemnify and hold harmless Mutual, its directors, officers, directors, agents, employees, volunteers, assigns, consultants, and contractors from and against any Liability or Proceedings to the extent arising out of or resulting from the negligent or intentional acts or omissions of City, its officials, staff, agents, employees, assigns, consultants or contractors in connection with this Agreement.

12.2 Indemnity by Mutual. To the fullest extent permitted by Applicable Law, Mutual shall defend, indemnify, and hold harmless City, its officials, staff, agents, employees, assigns, consultants and contractors from and against any Liability or Proceedings to the extent arising out of or resulting from the negligent or intentional acts or omissions of the Mutual, its officers, directors, agents, employees, assigns, consultants, contractors or volunteers in connection with this Agreement. Mutual shall also defend, indemnify, and hold harmless City, its officials, staff, agents, employees, assigns, consultants, contractors, or volunteers from and against any Liability or Proceedings arising out of or resulting from LAFCo action or inaction taken in connection with this Agreement.

12.3 Notice and Settlement of Claims. A Party seeking the benefit of an indemnity under this Section 12 shall give the other Party written notice of any claim giving rise to the indemnity promptly after such Party learns of the same. The indemnifying Party may, at its own cost, conduct negotiations for the settlement of such claim and any litigation that may arise therefrom. The Party claiming the benefit of the indemnity shall not make any admission that might be prejudicial to the indemnifying Party unless the indemnifying Party fails to take over the conduct of the negotiations or litigation within a reasonable time after having been so requested. The indemnifying Party shall not settle any indemnified claim without the indemnified Party's prior written approval, which is not to be unreasonably withheld, conditioned or delayed. The Party claiming the benefit of the indemnity shall, at the request of the other Party, provide reasonable assistance for the purpose of contesting any such claim or action, and shall be reimbursed all reasonable costs incurred in doing so and shall have the right to have its own counsel, at its expense, participate in the defense and negotiation of the claim or action.

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18 13. DISPUTES

13.1 Default; Cure. The failure by any Party to perform its obligations under this Agreement, which continues for more than thirty (30) days after receipt of written notice from the other Party stating the existence and nature of such default, shall constitute a "Default", unless the default cannot be cured in thirty (30) days, and in that event, if the defaulting Party fails to continuously and diligently remedy the default.

13.2 Waiver. The failure of any Party at any time or times to enforce or require performance of any provision of this Agreement shall in no way operate as a waiver or affect the right of such Party at a later time to enforce the same. No waiver by any Party of any condition or the breach of any term, covenant, representation or warranty contained in this Agreement, whether by conduct or otherwise, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such condition or breach, or a waiver of any other condition or of any other breach of any term, covenant, representation or warranty contained in this Agreement.

13.3 Equitable Remedies. The Parties agree that irreparable damage would occur and that the Parties would not have any adequate remedy at law in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. The Parties shall be entitled to all forms of equitable relief, including restraining orders, injunctions and specific performance to prevent breaches and to enforce specifically the terms and provisions of this Agreement in addition to any other remedy to which they are entitled at law or in equity. The Parties waive any requirement for the securing or posting of any bond in connection with the obtaining of any equitable relief.

13.4 Cumulation of Remedies. The Parties agree that in the event of a Default or breach of this Agreement, the Parties shall have all remedies at law or equity available to them, including specific performance and termination of this Agreement, and no remedy or election shall be deemed exclusive but shall, whenever possible, be cumulative with all other remedies at law or in equity.

13.5 Time of Essence. Time is of the essence of this Agreement.

13.6 Governing Law. This Agreement and any ancillary documents shall be deemed to have been made in the State of California and the validity of this Agreement and any ancillary documents, and the construction, interpretation and enforcement thereof, and the rights of the Parties thereto shall be determined under, governed by and construed in accordance with the internal laws of the State of California, without regard to the conflicts of law rules of the forum in which suit is initiated pertaining to this Agreement. The Parties acknowledge that this provision is mandatory and not permissive in nature, and was expressly bargained for and considered by the Parties in establishing the terms and conditions set forth in this Agreement.

13.7 Submission to Jurisdiction. Each Party irrevocably and unconditionally agrees that the courts of the State of California in San Benito County shall have exclusive jurisdiction to hear and decide any Proceeding relating to this Agreement to enforce a decision rendered in a Proceeding described in Section 14.3, and for these purposes each Party irrevocably submits to the jurisdiction and venue of such courts. Each Party hereby irrevocably and unconditionally waives, to the fullest extent permitted by Applicable Law, any objection that such Party may have now or hereafter to the laying of the venue or the jurisdiction or the convenience of the forum of any such legal suit, action or Proceeding.

13.8 Attorney Fees. If any legal action is brought for the enforcement or interpretation of this Agreement, the prevailing Party or Parties shall be entitled to recover reasonable attorney fees G.2.a
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19 and costs, which may be determined by the court in the same action or in a separate action brought for that purpose.

14. DISPUTE RESOLUTION

14.1 Settlement by Mutual Agreement. The Parties desire that this Agreement operate between them fairly and reasonably. If during the term of this Agreement a dispute arises between the Parties, or one Party perceives the other as acting unfairly or unreasonably, or a question of interpretation arises hereunder, then the Parties shall cause their respective representatives to promptly confer and exert their good faith efforts to reach a reasonable and equitable resolution of the issue. If the Parties' representatives are unable to resolve the issue within ten (10) Business Days, the matter shall be referred within two (2) Business Days of the lapse of such period to the Parties' responsible officers for resolution. No Party shall seek resolution by mediation of any dispute arising in connection with this Agreement until all Parties' responsible officers, who shall be identified by each Party from time to time, have had at least ten (10) Business Days to resolve the dispute following referral of the dispute to such responsible officers. If the Parties fail to settle such dispute within such period (including a failure to identify their respective responsible officers and make necessary referrals within such period), the provisions of Section 14.2 shall apply unless the Parties agree that the dispute is to be resolved according to the provisions of Section 14.3.

14.2 Mediation. If a dispute under this Agreement is not resolved by the Parties pursuant to Section

14.1, upon the request of any Party the Parties shall try in good faith to settle the dispute by nonbinding mediation administered by the American Arbitration Association under its Commercial Mediation Rules before resorting to litigation. Unless otherwise agreed upon by the Parties, the mediation shall be held in San Benito County, California. Each Party will bear the cost and expense of preparing and presenting its own case, including its own attorney fees and costs of witnesses.

Payment of the mediator and other costs and expenses of the mediation will be divided equally on a per-Party basis.

14.3 Litigation. If a dispute under this Agreement is not resolved by the Parties pursuant to Section 14.2 within thirty (30) days from the date on which a Party first requested mediation, then either Party may seek to resolve such dispute through litigation.

15. GENERAL PROVISIONS

15.1 Notices. Any notices required or permitted to be given hereunder shall be given in writing and shall be delivered: (a) in person; (b) by first class mail, postage prepaid, receipt requested; (c) by reputable commercial overnight courier that guarantees next Business Day delivery and provides a receipt; or (d) by electronic mail, addressed to the proper points of contact listed on Exhibit F. A Party may change its points of contact from time to time by updating Exhibit F and providing a revised copy of that document to all points of contact shown thereon. Any notice shall be deemed delivered when actually delivered.

15.2 Entire Agreement and Amendment. In conjunction with the matters considered herein, this Agreement contains the entire understanding and agreement of the Parties and there have been no promises, representations, agreements, warranties or undertakings by any of the Parties, either oral or written, of any character or nature binding except as stated in this Agreement.

This Agreement may be altered, amended or modified only by an instrument in writing, executed by the Parties to this Agreement and by no other means. Each Party waives its right to claim, contest or assert that this Agreement was modified, cancelled, superseded or changed by any oral agreement, course of conduct, waiver or estoppel.

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20 15.3 Additional Documents. Each Party shall, at the request of another Party, execute and deliver such other reasonable instruments and do and perform such other reasonable acts and things for effecting complete consummation of this Agreement and the transaction contemplated by this Agreement in the manner reasonably contemplated by this Agreement, and no Party shall unreasonably refuse to execute such documents herein contemplated.

15.4 Conditions Precedent. The obligation of a Party to perform any action under this Agreement shall be conditioned upon the issuance of all Approvals that would be required for the performance of that action. Each Party will use commer cially reasonable efforts to obtain the Approvals for which that Party is responsible, and the other Parties will cooperate in good faith with the responsible Party to obtain all Approvals.

15.5 Assignment. Mutual may assign all its duties and obligations under this Agreement to a purchaser of the Sewer Infrastructure, including a sewer system corporation regulated by the CPUC, then said successor shall fully assume said duties and obligations. Upon full assumption of such duties and obligations by the purchaser and provision of notice to City according to the form set forth in Exhibit G, the assignment of this Agreement to the purchaser of the Sewer Infrastructure shall act as a novation, and City shall automatically release Mutual from any further duties and obligations under this Agreement.

15.6 Successors and Assigns. This Agreement shall be binding on and shall inure to the benefit of the Parties and their respective successors, legal representatives and permitted assigns.

15.7 No Third Party Rights. Except as set forth in Section 15.8, nothing in this Agreement, whether expressed or implied, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the Parties to this Agreement and their respective successors and assigns, nor is anything in this Agreement intended to relieve or discharge the obligations or liability of any third persons to any Party to this Agreement, nor shall any provision give any third persons any right of subrogation or action over or against any Party to this Agreement.

15.8 Actions by San Juan Oaks Owner, LLC. Notwithstanding the provisions of Section 15.7, the Parties acknowledge and agree that Mutual may assign certain of its obligations under this Agreement to San Juan Oaks Owner, LLC ("Owner"), which is the owner of the Project Site and the responsible entity for development of the Project. City agrees that it will accept performance of the obligations of Mutual under this Agreement by Owner, including design of the Connection Infrastructure pursuant to Section 3, construction and warranty of the Connection Infrastructure pursuant to Section 4, and payment for the manhole replacement project pursuant to Section 4.9, and related to such obligations Mutual and Owner will act with joint and several responsibility.

15.9 Signatures and Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement shall not be effective until the execution and delivery between each of the Parties of at least one set of counterparts. The Parties authorize each other to detach and combine original signature pages and consolidate them into a single identical original. Any of such completely executed counterparts shall be sufficient proof of this Agreement. The Parties agree that receipt of what reasonably appears to be the facsimile of a signature by another Party shall be deemed equivalent as receipt of an original signature.

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21 IN WITNESS WHEREOF, the Parties have executed this Agreement below.

CITY OF HOLLISTER
Mia Casey
Mayor
ATTEST: APPROVED AS TO FORM:

Jennifer Woodworth
City Clerk Mary F. Lerner
Lozano Smith, LLP
City Attorney
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22 SAN JUAN OAKS MUTUAL WATER COMPANY
By:

Paul Sanders
CFO

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23 EXHIBIT A

MAP OF PROJECT AND MUTUAL SERVICE AREA
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24 WASTEWATER TREATMENT SERVICES AGREEMENT EXHIBIT A - MAP OF PROJECT AND MUTUAL SERVICE AREA G.2.a
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25 SAN JUAN OAKS SEPT 21, 2022 Whitson 0
SAN BENITO COUNTY, CALIFORNIA Project No.:1613.19 ENGINEERS Sheet 1 of 1 WHITSON ENGINEERS - 6 HARRIS COURT - MONTEREY, CALIFORNIA 93940 - TEL (831} 649-5225 - FAX (831)373-5065 - WWW.WHITSONENGINEERS.COM G.2.a
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26 EXHIBIT B

MAP OF DOMESTIC WATER RECLAMATION FACILITY
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27 WASTEWATER TREATMENT SERVICES AGREEMENT

EXHIBIT B - MAP OF DOMESTIC WATER RECLAMATION FACILITY

Domestic Water
Reclamation Facility
2690 San Juan Hollister Rd
Hollister Ca, 95023
Project and
Mutual
Service Area
pN
1 0
Sheet 1 of 1
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28 SAN JUAN OAKS

SAN BENITO COUNTY,

CALIFORNIA
WHRSON ENGINEERS - 6 HARRIS COURT -
MONTEREY, CALIFORNIA 93940 - TEL (831) 649-
5225- FAX (831)373-5065 - WWW.WHITSONENGINEERS.COM
SEPT 21, 2022 Whitson
Project No.:1613.19 ENGINEERS
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29 EXHIBIT C

CONNECTION INFRASTRUCTURE
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30 WASTEWATER TREATMENT SERVICES AGREEMENT
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31 EXHIBIT C - MAP OF DOMESTIC WATER RECLAMATION FACILITY SAN JUAN OAKS SEPT 21, 2022 Whitson
SAN BENITO COUNTY, CALIFORNIA Project No.:1613.19 ENGINEERS Sheet 1 of 1 WHITSON ENGINEERS - 6 HARRIS COURT - MONTEREY, CALIFORNIA 93940 - TEL (831) 649-5225 - FAX (831)373-5065 - WWW.WHITSONENGINEERS.COM G.2.a
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32 EXHIBIT D

REGULATIONS REGARDING THE SEWER COLLECTION SYSTEM OWNED BY MUTUAL

1. DEFINITIONS
For purposes of these regulations, the following words and phrases shall have the meanings respectively ascribed to them by this section:
(a) BOD (biochemical oxygen demand) means the quantity of oxygen utilized in the biochemical oxidation of organic matter under standard laboratory procedures in five days at 20 degrees centigrade expressed in milligrams per liter. (b) Building drains means the part of the lowest horizontal pipe of a drainage system which receives the discharge from soil, waste and other discharge pipes inside the walls of the building and conveys it to the building sewer. The building drain ends where it is connected to the building sewer five feet outside the building wall. (c) Building sewer means the extension of the building drain to the sewer owned by Mutual or other place of disposal.
(d) Combined sewer means a sewer receiving both sewage and surface runoff. (e) Mutual means San Juan Oaks Mutual Water Company.
(f) Natural outlet means any outlet taken to a watercourse, pond, ditch, lake or other body of surface or groundwater.
(g) Person means any individual, firm, company, partnership, association, the responsible corporate officer of any private or public corporation, the United States of America, the State of California, districts, cities, counties and governmental agencies. (h) pH means the logarithm of the reciprocal of the weight of hydrogen ion in grams per liter of solution.
(I) Premises means all parcels or land included by the San Benito County assessor in a single assessor's parcel number.
(j) Regulations means these "Regulations Regarding the Sewer Collection System Owned by Mutual".
(k) Sanitary sewage means water carried putrescible waste from residences, hotels, restaurants, eating houses or from business establishments or premises engaged solely in the sale, storage or repair of goods, wares or merchandise which contains garbage, human waste or animal waste.
(I) Sanitary sewer means a sewer which carries sanitary sewage to which storm, surface and ground water are not intentionally admitted. (m) Sewage means a sanitary sewage, together with such ground, surface and storm waters as may be present.
(n) Sewage works means all facilities for collecting, pumping, treating and disposing of sewage.

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33 D-1
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34 (o) Sewer means a pipe or conduit for carrying sewage. (p) Sewer treatment plant means an arrangement of devices and structures used for treatment of sewage.
(q) Storm drain or storm sewer means a sewer which carries storm and surface waters and drainage, but which excludes sewage other than uncontaminated cooling water. (r) Suspended solids means solids that either float on the surface or are in suspension in water, sewage or other liquids and which are removable by laboratory filtering. (s) Treatment works means any devices and systems used in the storage, treatment, recycling and reclamation of sanitary sewage or industrial wastes of a liquid nature or necessary to recycle or reuse water at the most economical cost over the useful life of the works, including interceptor sewers, outfall sewers, sewage collection systems, pumping, power, and other equipment and appurtenances; extensions, improvements, remodelling, additions and alterations thereof; elements essential to provide a reliable recycled supply such as standby treatment units and clear well facilities; and any works, including site acquisition of the land, that will be an integral part of the treatment process or is used for ultimate disposal of residues resulting from such treatment; or any other method or system for preventing, abating, reducing, storing, treating, separating or disposing of municipal waste, including storm water and sanitary sewer systems. (t) User means any person that discharges, causes or permits the discharge of wastewater into the sewer owned and operated by Mutual. (u) Watercourse means the channel in which a flow of water occurs, either continuously or intermittently.

2. CERTAIN WATER PROHIBITED FROM SANITARY SEWERS
No person shall discharge or cause to be discharged into any sanitary sewer any stormwater, surface water, groundwater, roof runoff, subsurface drainage, uncontaminated cooling water or industrial process water. (Source: Hollister Code of Ordinances § 13.04.070)

3. STORMWATER DISPOSAL
Stormwater and all other unpolluted drainage shall be discharged to such sewers as are specifically designed as combined sewers, storm sewers or natural outlets; provided, that Mutual does not own and has no responsibility for stormwater management. (Source: Hollister Code of Ordinances § 13.04.080)

4. MATERIALS PROHIBITED IN SEWERS
No person shall discharge or cause to be discharged any of the following into the sewers owned by Mutual:
(a) Any gas, benzene, naphthol, fuel, oil or other flammable or explosive solid, liquid or gas; (b) Any water or waste containing hazardous, toxic or poisonous solid, liquid or gas in sufficient quantities, either singularly or in reaction with other wastes, to injure or interfere with sewage treatment processes, constitute a hazard to humans or animals, create a public nuisance, create any hazard in any receiving water of the sewage treatment plant, including but not limited to, cyanides in excess of two milligrams per liter as carbon nitrogen in the wastes discharged to the sewer; G.2.a
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35 D-2
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36 (c) Any water or waste having a pH lower than 5.5 or having any other corrosive properties capable of causing damage or hazard to structures, equipment or personnel of the sewage works; or
(d) Solid or viscous substances in quantities or of such size as to be capable of causing obstructions to the flow in sewers or the interference with the proper operation of the sewer works, such as, but not limited to, ashes, cinders, sand, mud, straw, shavings, metal, glass, rags, feathers, tar, plastic, wood, underground garbage, whole blood, parched manure, hair and fleshing, whole or ground paper, dishes, cups, milk containers, wipes, etc. (Source: Hollister Code of Ordinances § 13.04.090)
S. MATERIALS MUTUAL MAY PROHIBIT
No person shall discharge or cause to be discharged into any sewer any of the following if, in the opinion of Mutual, the same may damage or injure the sewer, sewage treatment plant, sewage treatment process, sewage treatment equipment, or have an adverse effect on the receiving stream, endanger the public or constitute nuisance. In determining the acceptability of the following, Mutual shall consider such factors as the quantity to be received in relationship to the flows and velocities in the sewer, the materials of construction of the sewers, the nature of the sewer treatment process, the capacity of the sewer treatment plant, the degree of treatability in the sewer treatment plant and other related factors. The prohibited substances are as follows:
(a) Any liquid or vapor having a temperature of higher than 150 degrees Fahrenheit (65 degrees centigrade);
(b) Any water or waste containing fats, wax, grease or oils, whether emulsified or not, in excess of 100 milligrams per liter or containing substances which may solidify or become viscous at temperatures between 32 degrees and 150 degrees Fahrenheit (zero degrees and 65 degrees centigrade);
(c) Any garbage that has not been properly shredded. The installation and operation of any garbage grinder equipment with a motor of three-quarters horsepower (.76 horsepower, metric) or greater, shall be subject to the approval of Mutual; (d) Any water or waste containing acids, iron pickling or concentrated plating solutions, whether neutralized or not;
(e) Any water or waste containing iron, chromium, copper, zinc or other similar toxic substances or wastes exerting an excessive chlorine requirement to such degree that any such material received in the composite sewage at the sewer treatment plant exceeds the limits established by the City of Hollister for such materials; (f) Any water or waste containing phenols or taste or odor-producing substances, in such concentrations exceeding limits which may be established by the State of California or the United States, or agencies thereof having jurisdiction over the discharge thereof to receiving waters;
(g) Any radioactive wastes or isotopes such as half-lives or concentrations as may exceed limits as established by Mutual in compliance with applicable state and federal regulations;

(h) Any water or wastes having a pH in excess of 9.5;
(i) Materials which exert or cause:

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37 (i) Unusual concentrations of suspended solids (such as, but not limited to, fuller's earths, lime slurries, and lime residuals or organic materials) or of dissolved solids (such as, but not limited to, starches, sugars, sodium chloride and sodium sulfate); (ii) Excessive discoloration (such as, but not limited to, dye, wastes and vegetable tanning solutions);
(iii) Unusual BOD, chemical oxygen demand, or chlorine requirements in such quantities so as to constitute a significant load on the sewer treatment plant; (iv) Any unusual volume or flow of concentration of wastes which upsets or affects the balance of the sewer treatment plant;
Water or waste containing substances which are not admittable to treatment or reduction by the sewage treatment processes employed, or are amenable to treatment only to such degree that the sewer treatment plant effluent cannot meet the requirements of other agencies having jurisdiction over the discharge of the receiving waters. (Source: Hollister Code of Ordinances § 13.04.100)

6. ACTION RESULTING FROM DEPOSIT OF DELETERIOUS WASTES
If any water or waste is discharged or proposed to be discharged to the sewer, which water contains the substances or processes and characteristics set forth in Sections 4 or 5 above, or which, in the judgment of Mutual, may have a deleterious effect upon the sewage treatment works, processes, equipment or receiving water, or which constitutes a danger to public health, safety or welfare, or which constitutes a public nuisance, Mutual may: (a) reject the water or waste; (b) require pretreatment to an acceptable condition for discharge to the sewer; (c) control quantity or rate of discharge; (d) require payment to cover the additional costs and expenses of handling and treating the wastes not covered by existing tariffs; or (e) refuse to furnish service or discontinue service. (Source: Hollister Code of Ordinances § 13.04.110)

7. GREASE TRAPS REQUIRED
Grease, oil and sand interceptors shall be provided when, in the opinion of Mutual, they are necessary for the proper handling of liquid wastes containing grease, flammable waste, sand or other harmful ingredients, except that such interceptors shall not be required for residential dwelling units. All interceptors shall be of a type and capacity approved by Mutual and shall be located so as to be readily and easily accessible for cleaning and inspection. Failure to clean or maintain interceptors shall be grounds for discontinuance of service or other action as provided in these regulations. (Source: Hollister Code of Ordinances § 13.04.130)

8. APPROVALS REQUIRED
No person shall uncover, make any connection to or with, or open, use, alter o r disturb any sewer, or appurtenance thereto, without first receiving approval from Mutual. A building sewer approval shall be obtained from Mutual before connecting a building sewer to the sewer collection system owned by Mutual. Approvals shall be obtained from Mutual based on applications filed with Mutual on forms provided by Mutual. (Source: Hollister Code of Ordinances § 13.04.150)
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38 9. NOTIFICATION OF POTENTIAL PROBLEMS
Users shall notify Mutual immediately upon any accidental discharge of wastes in violation of these regulations to enable countermeasures to be taken by Mutual to minimize damage to the sewage works and the receiving waters. The notification shall be followed, within 15 days of the date of occurrence, by a detailed written statement describing the causes of the accidental discharge and the measures being taken to prevent future occurrence. Such notification will not relieve users of liability for any expense, loss or damage to the sewer collection system, treatment plant or treatment process. (Source: Hollister Code of Ordinances § 13.04.490)

10. NOTICES TO EMPLOYEES
In order that employees of users be informed of the requirements of these regulations, users shall make available to their employees copies of these regulations, together with such other wastewater information and notices which may be furnished by Mutual from time to time directed toward more effective water pollution control. A notice shall be furnished and permanently posted on the user's bulletin board advising employees whom to call in case of an accidental discharge. (Source: Hollister Code of Ordinances § 13.04.500)

11. PREVENTIVE MEASURES
Any direct or indirect connection or entry point for persistent or deleterious wastes to the user's plumbing or drainage system should be eliminated. Where such action is impractical or unreasonable, the user shall appropriately label such entry points to warn against discharge of such wastes in violation of the requirements of these regulations. (Source: Hollister Code of Ordinances § 13.04.510)

12. HARMFUL CONTRIBUTIONS
Mutual may immediately suspend wastewater treatment service to a user when such suspension is necessary, in the opinion of Mutual, to stop an actual or threatened discharge which presents or may present an imminent or substantial endangerment to the health or welfare of persons, or to the environment, or causes interference to the sewage works, or causes Mutual to violate or be in violation of any condition of any permit issued by the regional water quality control board or any agency having jurisdiction over the Mutual's sewer system or the Wastewater Treatment Services Agreement between Mutual and the City of Hollister. Any person notified of a suspension of wastewater treatment service shall immediately stop or eliminate the contribution. In the event of a failure of the person to comply voluntarily with the suspension order, Mutual shall take such steps as deemed necessary, including immediate severance of the sewer connection, to prevent or minimize damage to the sewage works or endangerment to any individuals. Mutual shall reinstate wastewater treatment service upon proof of the elimination by the noncomplying user describing the causes of the harmful contribution and the measures taken to prevent any future occurrence.

This shall be submitted to Mutual within 15 days of the date of occurrence. (Source: Hollister Code of Ordinances § 13.04.530)

13. SUBMISSION OF TIME SCHEDULE
When Mutual finds that a discharge of wastewater has been taking place in violation of these regulations, applicable law or pretreatment requirements, Mutual may require the user to submit for approval, with such modification as Mutual deems necessary, a detailed time schedule of specific actions which the user shall take in order to prevent or correct a violation of the requirement. (Source: Hollister Code of Ordinances § 13.04.540) G.2.a
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39 0. TERMINATION OF SERVICE
In order to properly operate and maintain the sewage works, Mutual may enter upon private property for the purpose of inspection and maintenance of sanitary and waste disposal facilities and may terminate service to property in which a violation of these regulations is found to exist.

Prior to termination of service, however, Mutual shall notify, in writing, the owner and tenant, if any, of such property that service is intended to be so terminated and consider any information provided by the owner or tenant within 15 days of provision of notice. Such notice shall be mailed to the owner at the address as known to Mutual, and a copy shall be delivered to the tenant or posted conspicuously on the property. The notice shall state the date of proposed termination of service and the reasons therefor. (Source: Hollister Code of Ordinances §

13.04.620)

1. RELATIONSHIP TO HOLLISTER CODE OF ORDINANCES
Sewage collected by Mutual via the sewage works is delivered to the City of Hollister for treatment, reclamation, reuse and disposal at the city's Domestic Water Reclamation Facility ("DWRF"). These regulations are drafted to support the proper functioning of the DWRF and other sewage works owned by the City of Hollister, and are consistent with the Hollister Code of Ordinances that govern actions by users of sewage works that feed into the DWRF. These regulations may be amended by Mutual from time to time to match future amendments to the Hollister Code of Ordinances or as otherwise deemed appropriate by Mutual.

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40 D-6

EXHIBIT E

CITY SEWER RATE AND WASTEWATER TREATMENT RATE
For Commercial/Industrial Low Strength Customers:

Monthly service charge ........................................................ $46.23 Monthly volume charge per hundred cubic feet .......................... $8.70 For purposes of the rate set forth above, Mutual will pay for one (1) monthly service charge and the volume of wastewater delivered to City on a monthly basis, measured as set forth in Section 6.3 of the Agreement. If in the future City modifies the design of its City Sewer Rate, design of Wastewater Treatment Rate shall be modified to match the modified City Sewer Rate.

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41 EXHIBIT F

POINTS OF CONTACT
Purpose City Mutual
Design and construction (§§ 3-4) Henry Gonzales
Utilities Supervisor
City of Hollister
1291 South Street
Hollister, CA 95023
(831) 636-4377
[email protected]
Terry Secor
San Juan Oaks Mutual Water Company
c/o Third Millennium Partners
5671 Santa Teresa Blvd, Suite 216
San Jose, CA 95123
(408) 960-8010
[email protected]
Operations (§§ 5, 6, 8)
Emergencies (§ 8.2)
Billing and payment (§ 7)
Henry Gonzales
See above
Henry Gonzales
See above
Terry Secor
See above
Terry Secor
See above
Terry Secor
See above

Henry Gonzales
See above

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42 F-1
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43 Purpose City Mutual
Contract administration and legal (§§ 9-15) City of Hollister Attn: City Manager
375 Fifth Street
Hollister, CA 95023
(831) 636-4300
[email protected]
and
Michael Cady
San Juan Oaks Mutual Water Company
c/o Third Millennium Partners
5671 Santa Teresa Blvd, Suite 216
San Jose, CA 95123
(408) 960-8010
mcady0thirdmillenniumpartners.com
and
Mary F. Lerner
Lozano Smith
Re: City of Hollister
7404 North Spalding Avenue
Fresno, CA 93720
+1 (559) 431-5600
[email protected]
Wes Strickland
Ashurst LLP
1299 Ocean Ave, Ste 320
Santa Monica, CA 90401
+1 (424) 416-5692
wes.strickland©ashu rst.com
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44 F-2
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45 EXHIBIT G

FORM OF NOTICE OF ASSIGNMENT BY MUTUAL
City of Hollister
Attn: City Manager
375 Fifth Street
Hollister, CA 95023
Subj: Notice of Assignment of Interest in Wastewater Treatment Services Agreement To Whom It May Concern:

Please be advised that effective as of [ _________ ] San Juan Oaks Mutual Water Company ("Mutual") will assign to Golden State Water Company ("GSWC") all of Mutual's interest in that certain Wastewater Treatment Services Agreement dated [ _______ ], 2022 ("WTSA"), by and between Mutual and the City of Hollister. From and after that date, GSWC will assume ownership and operation of all Sewer Infrastructure, as defined in the WTSA, and Mutual shall have no further responsibility therefor. GSWC expressly agrees to assume all responsibilities to the City of Hollister pursuant to the WTSA, as acknowledged by signature below. All other provisions of the WTSA shall remain unaffected by the assignment. Attached to this notice of assignment, please find a revised Schedule 6 from the WTSA, setting forth the points of contact for GSWC.

Both Mutual and GSWC look forward to a smooth transition for ownership and operation of the Sewer Infrastructure, including the relationship with the City of Hollister. If you have any questions, please reach out to [ ______ ] at [ ______ ].

SAN JUAN OAKS MUTUAL WATER COMPANY
Dustin Bogue
President

GOLDEN STATE WATER COMPANY

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Page 1 of 2 ends

Hollister City CouncilJune 20, 2023

Hollister City Council
June 20, 2023