SECTION B – Page 5
INSTRUCTION TO BIDDERS
to enable him/her to prosecute the work successfully and properly, and to complete it within the time stated in the contract.
To determine the degree of responsibility to be credited to the bidder, the Agency will weigh any evidence that the bidder has performed satisfactorily other contracts of like nature, magnitude and comparable difficulty and comparable rates of progress. If in the opinion of the Agency, a bidder is determined to be insufficiently qualified, then that bidder will not be considered for award of the contract.
B1.12 DESIGNATION OF SUPPLIERS AND SUBCONTRACTORS
Each proposal shall have listed on the DESIGNATION OF SUPPLIERS AND SUBCONTRACTORS form provided in SECTION C the name and address of each subcontractor to whom the bidder proposes to sublet portions of the work in excess of one-half percent of the total amount of his/her bid. For the purpose of this paragraph, a subcontractor is defined as one who contracts with the Contractor to furnish materials and labor, orlabor only forthe performance of work at the site ofthe work or whowillspecially fabricate aportionoftheworkoffthe sitepursuanttodetaileddrawingsinthe contractdocuments.
Public Contract Code § 4104 requires all bidders to list subcontractors who will perform work in excess of ½% of the total bid, or in the case of streets and highways, ½% or $10,000, whichever is greater.
Public Contract Code § 6109 prohibits a contractor from performing work with a subcontractor who is debarred pursuant to Labor Code §§ 1777.1 or 1777.7.
B1.13 PROPOSAL GUARANTEE
The proposal shall be accompanied by a proposal guarantee bond duly completed on the form provided herewith by a guarantee company authorized to carry on business in the State of California for payments to the Agency in the sum of at least 10% of the total amount of the bid proposal, or alternatively by a certified or cashier’s check payable to the Agency, or cash, in the sum of at least 10% of the total amount of the bid proposal. The amount payable to the Agency under the proposal guarantee shall be forfeited to the Agency in case of failure or neglect of the bidder to furnish, execute and deliver to the Agency the required bonds, evidence of insurance and to enter into, execute and deliver to the Agency the agreement on the form provided herewith, within ten (10) days after being notified in writing by the Agency that the award has been made and the agreement is ready for execution.
B1.14 MODIFICATION OF PROPOSAL
A modification of a bid proposal already received will be considered only if the modification is received before the time announced for the opening of bids. All modifications shall be made in writing, executed and submitted in the same form and manner as the original bid proposal.
B1.15 WITHDRAWAL OF PROPOSAL
A proposal may be withdrawn by a written request signed by the bidder. Such requests must be delivered to the Agency’s designated official prior to the bid opening hour stipulated in SECTION A – NOTICE INVITING SEALED BIDS. Proposals may not be withdrawn after that time without forfeiture of the proposal guarantee. The withdrawal of a proposal will not prejudice the right of the bidder to submit a new proposal, providing there is time to do so.
B1.16 POSTPONEMENT OF BID OPENING
SECTION B – Page 6
INSTRUCTION TO BIDDERS
The Agency reserves the right to postpone the date and time for opening of bids at any time prior to the date and time announced in SECTION A–NOTICE INVITING SEALED BIDS.
B1.17 DISQUALIFICATION OF BIDDERS
If there is reason to believe that collusion exists among the bidders, none of the bids of the participants in such collusion will be considered. In the event that any bidder acting as a prime Contractor has an interest in more than one proposal, all such proposals will be rejected, and the bidder will be disqualified. This restriction does not apply to subcontractors or suppliers who may submit quotations to more than one bidder, and while doing so, may also submit a formal proposal as a prime Contractor.
B1.18 REJECTION OF PROPOSALS
The Agency reserves the right to reject any and all proposals, to waive any irregularity, and to reject any proposals which are incomplete, obscure or irregular; any proposals which omit a bid on any one or more items on which bids are required; which omit unit prices if unit prices are required; in which unit prices are unbalanced in the opinion of the Agency; which are accompanied by insufficient or irregular bid security; or which are from bidders who have previously failed to perform properly or to timely complete contracts of any nature.
B1.19 AWARD OF CONTRACT
The Contract will be awarded, if at all, to the lowest responsible and responsive bidder, whose bid proposal is not rejected for cause by the Agency. However, until an award is made, the Agency reserves right will be reserved to reject any or all bids, and to waive technical errors or discrepancies, if to do so is deemed to best serve the interests of the Agency. In no event will an award be made until all necessary investigations are made as to the responsibility and qualifications of the bidder to whom it is proposed to make such an award.
Each bidder’s attention is directed to the possibility that the award of the project may be delayed for various reasons. The Agency reserves the right to delay the award of the project for 45 calendar days. After 45 calendar days, the low bidder may at any time request release from its bid without penalty.
The acceptance of a proposal will be evidenced by a Notice of Award of Contract in writing, delivered by mail to the bidder whose proposal is accepted. No other act of the Agency shall constitute acceptance of a proposal. The award of contract shall obligate the bidder whose proposal is accepted to furnish a performance bond, payment bond and maintenance bond, as well as evidence of insurance and to execute the contract set forth herein.
B1.20 RETURN OF PROPOSAL GUARANTEES
Within ten (10) calendar days after the bids are opened, the Agency will release the proposal guarantees accompanying the proposals which are not to be considered in making the award. Proposal guarantees for the two lowest bidders will be held until the contract has been fully executed, after which they will be returned to the respective bidders.
B2.21 EXECUTION OF CONTRACT
The contract agreement shall be executed in duplicate by the successful bidder and returned, together with the contract bonds and evidence of insurance, within ten (10) calendar days after the notification of the contract award by the Agency in writing. In case of failure of the successful bidder to execute the contract agreement within ten (10) calendar days after such notice, or any subsequent extension approved
SECTION B – Page 7
INSTRUCTION TO BIDDERS
by Agency, the Agency at its option may consider the bidder in default, in which case the bid bond or proposal guarantee accompanying the bid shall become the property of the Agency. After execution by the Agency, one original contract shall be returned to the Contractor.
B1.22 FLEXIBILITY OF BID SCHEDULE
It is the intent of the Agency to award a contract to the lowest responsible and responsive bidder and the flexibility shown in the bid schedule is necessary to ensure a project within the Agency’s budget limits and constraints.
B1.23 SB 854
• No contractor or subcontractor may be listed on a bid proposal for a public works project (submitted on or after March 1, 2015) unless registered with the Department of Industrial Relations pursuant to Labor Code section 1725.5 [with limited exceptions from this requirement for bid purposes only under Labor Code section 1771.1(a)]. • No contractor or subcontractor may be awarded a contract for public work on a public works project (awarded on or after April 1, 2015) unless registered with the Department of Industrial Relations pursuant to Labor Code section 1725.5. • This project is subject to compliance monitoring and enforcement by the Department of Industrial Relations.
SECTION C – Page 1
PROPOSAL INFORMATION AND DOCUMENT
SECTION C
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
PROPOSAL INFORMATION AND DOCUMENTS
PROPOSAL INFORMATION AND DOCUMENTS
BID PROPOSAL
BID SCHEDULE
BIDBOND
BID GUARANTEE
BIDDER INFORMATION
EXPERIENCE STATEMENT
DESIGNATION OF SUPPLIERS AND SUBCONTRACTORS
SECTION C – Page 2
PROPOSAL INFORMATION AND DOCUMENT
BID PROPOSAL
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
The undersigned, as bidder, declares that he/she has examined all of the contract documents and specifications contained in this project manual for the above referenced project, and that he/she will contract with the Agency on the form of contract provided herewith to do everything necessary for the fulfillment of this contract at the price, and on the terms and conditions therein contained.
The following are included and are to be considered as forming a part of this proposal: BID
PROPOSAL, BID SCHEDULE, BID BOND, NONCOLLUSION AFFIDAVIT, BIDGUARANTEE (if submitted in lieu of Bid Bond), BIDDER INFORMATION, EXPERIENCE STATEMENT, DESIGNATION OF SUPPLIERS & SUBCONTRACTORS, BIDDER’S STATEMENT REGARDING INSURANCE COVERAGE, and STATEMENT REGARDING CONTRACTOR’S LICENSING LAWS.
Contractor acknowledges receipt and inclusion of addenda _ to into this bid proposal and the contract documents.
Attached is a Bid Bond duly completed by a guarantee company authorized to carry on business in the State of California in the amount of at least 10% of the total amount of this proposal, or alternatively, there is attached a certified or cashier’s check payable to the Agency or evidence of a cash payment to the Agency, in the amount of at least 10% of the total amount of our proposal.
If this proposal is accepted, we agree to sign the contract form and to furnish the Performance Bond and the Payment Bond (each to be 100% of the bid amount), the Maintenance Bond (to be 50% of the bid amount), and the required evidences of insurance within ten (10) calendar days after receiving written Notice of Award of Contract.
We further agree if our proposal is accepted and a contract for the performance of the work is entered into with the Agency, to so plan the work and to prosecute it with such diligence that all of the work shall be completed within the time stipulated in SECTION E – TIME OF COMPLETION.
NAME OF BIDDER:
MAILING ADDRESS:
STATE OF INCORPORATION:
AUTHORIZED SIGNATURE:
TITLE:
DATE: _
(If Company is a Corporation, provide corporate resolution per B 1.06 PROPOSAL.)
SECTION C – Page 3
PROPOSAL INFORMATION AND DOCUMENT
BID SCHEDULE
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
The cost of all labor, services, material, equipment and installation necessary for the completion of the work itemized under this schedule, even though not shown or specified, shall be included in the unit price for the various items shown herein. For a description of the work associated with each bid item, see SECTION E– SPECIAL PROVISIONS. The Agency reserves the right to increase or decrease the quantity of any item or omit items as may be necessary, and the same shall in no way affect or void the contract, except that appropriate additions or deductions from the contract total price will be made at the stipulated unit price in accordance with these Contract Documents.
The Agency reserves the right to reject any and all bids, to waive any informality in a bid, and to make awards in the interest of the Agency.
The Contractor shall perform an independent take-off of the plans and bid accordingly. Quantities listed in this Bid Schedule are intended only as a guide for the Contractor as to the anticipated order of magnitude of work. The Contractor shall be responsible for verifying all estimated quantities. The Contractor will be reimbursed for the quantity of items actually installed as required by the Contract Documents, including addenda, and shown on the plans to neat line and grade.
The Contractor will not be reimbursed for work performed for his convenience, or as required to adapt to field conditions, or for unauthorized work performed outside of that required by the Contract Documents.
The Contractor shall be responsible for calculating and providing totals for the bid schedule. The proposal schedule shall include all costs for labor, services, material, equipment, and installation associated with completing the work in place per the plans, specifications and details.
NAME OF BIDDER:_
CONTRACTOR’S LICENSE NO.:
AUTHORIZED SIGNATURE:
TITLE:
DATE:_
SECTION C – Page 4
PROPOSAL INFORMATION AND DOCUMENT
BID SCHEDULE (Continued)
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
BID SCHEDULE A
No. Item Description Estimated
Quantity
Unit Unit Price Extended Price
1 Trip Hazard Removal (1/4” to 2”) 1,700 Inch Foot $ $
BID SCHEDULE B – ADDITIVE ALTERNATE
No. Item Description Estimated
Quantity
Unit Unit Price Extended Price
2 Sidewalk Assessment Services 10 Sidewalk Mile $ $
Billing Units: Services are billed in “Inch Feet”. An inch foot is calculated by measuring the average height of the sidewalk off-set and multiplying this average by the length of the cut .
Example (1): A sidewalk off-set on a 4-foot wide sidewalk that consist of .5” rise on one side and tapers down to a zero rise on the other is calculated as follows:
((0.5” + 0.0”)/2) x 4’= 1-inch foot
Example (2): A sidewalk off-set on a 4-foot wide sidewalk that consists of a 6” on one side and tapers down to a 0.5” rise on the other is calculated as follows:
((6” + 0.5”)/2) x 4’ = 13- inch foot
Include hourly rates for additional work which may be authorized by the AGENCY’S City Manager or City Engineer
The quantities listed in the Bid Schedule are approximate and are provided as a basis for selecting the low bidder and the final quantity for the above bid items will vary.
The Contractor shall be responsible for calculating and providing unit prices for the schedule. The proposal schedule shall include all costs for services, labor, materials, equipment, and installation associated with completing the work in place per the plans, specifications and details.
SECTION C – Page 5
PROPOSAL INFORMATION AND DOCUMENT
The AGENCY has the option to reject all bids with or without cause. The AGENCY also has the option to remove bid items at its discretion. If the AGENCY chooses to remove bid items, no bid price adjustment will be allowed.
For the purposes of determining the lowest responsible bidder, the Bid Schedule A Total shall be considered.
(Company Name of Bidder) (Date)
SECTION C – Page 6
PROPOSAL INFORMATION AND DOCUMENT
BID BOND
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
KNOW ALL MEN BY THESE PRESENTS that Bidder , as PRINCIPAL, and , as SURETY, are held and firmly bound unto the City of Los Alamitos as AGENCY, in the penal sum of
dollars ($ ), which is ten percent (10%) of the total amount bid by PRINCIPAL to AGENCY for the above stated project, for the payment of which sum, PRINCIPAL and SURETY agree to be bound, jointly and severally, firmly by these presents.
The SURETY, for value received, hereby stipulates and agrees that the obligations of said SURETY and its BOND shall be in no way impaired or affected by any extension of the time within which the AGENCY may accept such Bid; and said SURETY does hereby waive notice of any such extension.
THE CONDITIONS OF THIS OBLIGATION ARE SUCH that, whereas PRINCIPAL is about to submit a bid to AGENCY for the above stated project, if said bid is rejected, or if said bid is accepted and a contract is awarded and entered into by PRINCIPAL in the manner and time specified, and PRINCIPAL provides the required payment and performance bonds and insurance coverages to AGENCY, then this obligation shall be null and void, otherwise it shall remain in full force and effect in favor of AGENCY.
IN WITNESS WHEREOF the parties hereto have set their names, titles, hands, and seals this______ day of ______, 2023.
PRINCIPAL*
SURETY*
*Provide BIDDER and SURETY name, address and telephone number and the name, title, address and telephone number for their authorized representatives. Power of Attorney must be attached.
Subscribed and sworn to this day of , 2023.
NOTARY PUBLIC (SEAL)
SECTION C – Page 7
PROPOSAL INFORMATION AND DOCUMENT
BID GUARANTEE
ON-CALL SERVICES FOR CONCRETE REMEDIATIONCIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
Note: The following statement shall be used if other than a bid surety bond accompanies bid. “Accompanying this proposal is a money order*, certified check*, cashier’s check*, cash*, payable to the order of the City of Los Alamitos in the amount of
Dollars ($ ) which is at
least ten percent (10%) of the total amount of this bid. The proceeds of this bid guarantee shall become the property of the City of Los Alamitos provided this bid is accepted by said City, through action of its legally constituted contracting authorities, and the undersigned fails to execute a contract and furnish the required bonds and insurance within the stipulated time. Otherwise, the proceeds of this bid guarantee shall be returned to the undersigned.”
NAME OF BIDDER:
MAILING ADDRESS:
AUTHORIZED SIGNATURE:
TITLE:
DATE:
(*Delete the inapplicable words)
SECTION C – Page 8
PROPOSAL INFORMATION AND DOCUMENT
BIDDER INFORMATION
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
BIDDER certifies that the following information is true and correct:
Name of Bidder:
Business Address:
Telephone: . FAX:
E-mail:
Contractor’s License No.: Date License Issued: .
License Expiration Date:
The following are the names, titles, addresses, and phone numbers of all individuals, firm members, partners, joint venturers, and/or corporate officers having a principal interest in this proposal: (Name / Title / Address / Telephone)
Any voluntary or involuntary bankruptcy judgments against any principal having an interest in this proposal are as follows: (Type of Judgment / Date)
All current and prior DBA’s, aliases, and/or fictitious business names for any principal having an interest in this proposal are as follows: (Principal / DBA’s / Applicable Dates) Prior Disqualification
SECTION C – Page 9
PROPOSAL INFORMATION AND DOCUMENT
Has your firm ever been disqualified from performing work for any City, County, Public or Private Contracting entity? Yes / No . If yes, provide the following information. (If more than once, use separate sheets):
Date: Entity:
Location:
Reason:
Provide Status and any Supplemental Statement:
Has your firm been reinstated by this entity? Yes / No
Violations of Federal or State Law
A. Has your firm or its officers been assessed any penalties by any agency for noncompliance, violations of Federal or State labor laws and/or business or licensing regulations within the past five (5) years relating to your construction projects?
Yes / No: Federal / State:
If “yes”, identify and describe, (including status):
Have the penalties been paid? Yes / No:
SECTION C – Page
10 PROPOSAL INFORMATION AND DOCUMENT
B. Does you firm or its officers have any ongoing investigations by any AGENCY regarding violations of the State Labor Code, California Business and Professions Code or State Licensing laws?
Yes / No: Codes / Laws: Section / Article:
If “yes”, identify and describe (including status):
I declare under penalty of perjury under the laws of the State of California that all of the representations made in this BIDDER INFORMATION are true and correct. Executed this day of , 2023, at ,
California.
Authorized Representative Signature and Title
SECTION C – Page 10
PROPOSAL INFORMATION AND DOCUMENT
EXPERIENCE STATEMENT
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
Pursuant to this BID PROPOSAL and QUALIFICATION OF BIDDERS, the following is a record of the Bidder’s experience in construction of a type similar in magnitude and character to that contemplated under this contract. Included in this section should be a complete list of references for similar projects in terms of scope of work, value of work, and time constraints. The Contractor must demonstrate that he/she has experience with this type of project and can manage this project effectively. If necessary, additional numbered pages can be attached to this page. The Contractor must be properly licensed to perform the work in this project as determined by the State Contractor’s License Board.
Project Title: Client:
Date: Project Value: _ Contact: _ Tel #
Description:
Subject to Federal Labor Standards: Yes No
Project Title: Client:
Date: Project Value: _ Contact: _ Tel #
Description:
Subject to Federal Labor Standards: Yes No
SECTION C – Page 11
PROPOSAL INFORMATION AND DOCUMENT
EXPERIENCE STATEMENT (Continued)
ON-CALL SERVICES FOR CONCRETE REMEDIATIONCIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
Project Title: Client:
Date: Project Value: _ Contact: _ Tel #
Description:
Subject to Federal Labor Standards: Yes No
Project Title: Client:
Date: Project Value: _ Contact: _ Tel #
Description:
Subject to Federal Labor Standards: Yes No
I declare under penalty of perjury under the laws of the State of California that all of the representations made in this EXPERIENCE STATEMENT are true and correct. Executed this day of , 20 , at ,
California.
Authorized Representative Signature and Title
SECTION C – Page 12
PROPOSAL INFORMATION AND DOCUMENT
DESIGNATION OF SUPPLIERS AND SUBCONTRACTORS
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
The following is a list of subcontractors and suppliers, as defined in 2-3 SUBCONTRACTS of the Standard Specifications, who will perform work or provide materials of value in excess of one-half percent of the total bid price or $10,000, whichever is greater.
No subcontractor shall perform work in excess of the amount specified in 2-3 SUBCONTRACTS of the Standard Specifications, without the written approval of the Agency.
The Contractor is responsible to ensure that appropriate provisions are to be inserted in all subcontracts to bind subcontractors to the contract requirements as contained herein.
Each subcontractor must agree to comply with all applicable Federal, State, and local requirements.
Name and Address of
Subcontractor
Employer
Tax Id #
MBE/
WBE
(Y/N)
Work Subcontracted Portion of Work (% of
Contract Price)
Name and Address of
Subcontractor
Employer
Tax Id #
MBE/
WBE
(Y/N)
Work Subcontracted Portion of Work (% of
Contract Price)
These representations are made under the penalty of perjury under the laws of the State of California.
The undersigned hereby certifies that each subcontractor has been notified in writing of its equal opportunity obligations.
NAME OFBIDDER:
AUTHORIZEDSIGNATURE: _
Date:
SECTION C – Page 13
PROPOSAL INFORMATION AND DOCUMENT
SECTION D – Page 1
CONTRACT INFORMATION AND DOCUMENT
SECTION D
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08IN THE CITY OF LOS
ALAMITOS, CALIFORNIA CONTRACT
INFORMATION AND DOCUMENTS
CONTRACT INFORMATION AND DOCUMENTS
CONTRACT AGREEMENT
PAYMENT BOND
FAITHFUL PERFORMANCE
BOND MAINTENANCE BOND
NON-COLLUSION AFFIDAVIT
WORKER’S COMPENSATION INSURANCE CERTIFICATE
INSURANCE ENDORSEMENT
STATEMENT RE INSURANCE COVERAGE
STATEMENT RE THE CONTRACTOR’S LICENSING LAWS
SECTION D – Page 2
CONTRACT INFORMATION AND DOCUMENT
ARTICLES OF AGREEMENT
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
THIS ON-CALL SERVICES FOR CONCRETE REMEDIATION CIP NO. 22/23-08 AGREEMENT (“AGREEMENT”) is made and entered into for the above- stated project this day of Month, 20XX (Council Action Date Here), BY AND BETWEEN the City of Los Alamitos, a municipal corporation, hereafter designated as
“AGENCY”, and CONTRACTOR’S BUSINESS NAME, a (State)
(corporation, partnership, limited liability company, or other business form), hereafter designated as “CONTRACTOR.”
WITNESSETH that AGENCY and CONTRACTOR have mutually agreed as follows:
ARTICLE I: Contract Documents
The contract documents for the ON-CALL SERVICES FOR CONCRETE REMEDIATION CIP NO. 22/23-08 shall consist of the Notice Inviting Sealed Bids, Instructions To Bidders, Bid Proposal, Bid Schedule, Standard Specifications, Special Provisions, and all referenced specifications, details, standard drawings, and appendices; together with two signed copies of the AGREEMENT, two signed copies of required bonds; one copy of the insurance certificates, permits, notices, and affidavits; and also including any and all addenda or supplemental agreements clarifying, amending, or extending the work contemplated as may be required to ensure its completion in an acceptable manner (collectively referred to herein as the “Contract Documents”). All of the provisions of the Contract Documents are made a part hereof as though fully set forth herein.
ARTICLE II: Scope of Work
For and in consideration of the payments and agreements to be made and performed by AGENCY, CONTRACTOR agrees to furnish all materials and equipment and perform all work required for the above-stated project, and to fulfill all other obligations as set forth in the aforesaid contract documents.
AGENCY hereby employs CONTRACTOR to provide the materials, do the work, and fulfill the obligations according to the terms and conditions herein contained and referred to, for the prices provided herein, and hereby contracts to pay the same at the time, in the manner, and upon the conditions set forth in this A G R E E M E N T .
In entering into a public works contract or a subcontract to supply goods, services, or materials pursuant to this AGREEMENT, CONTRACTOR offers and agrees to assign to the AGENCY all rights, title, and interest in and to all causes of action it may have under Section 4 of the Clayton Act (15 U.S.C. Sec. 15) or under the Cartwright Act (Chapter 2 (Section 16700, et seq.) of Part 2 of Division 7 of the Business and Professions Code), arising from purchases of goods, services, or materials pursuant to the public works contract or the subcontract. This assignment shall be made and become effective at the time the awarding body tenders final payment to CONTRACTOR, without further acknowledgment by the parties.
SECTION D – Page 3
CONTRACT INFORMATION AND DOCUMENT
ARTICLE III: Compensation
A. CONTRACTOR agrees to receive and accept the prices set forth in the Bid Proposal and Bid Schedule as full compensation for furnishing all materials, performing all work, and fulfilling all obligations hereunder. In no event shall the total compensation and costs payable to CONTRACTOR under this Agreement exceed the sun of Dollars ($ ,) unless specifically approved in advance and in writing by AGENCY Such compensation shall cover all expenses, losses, damages, and consequences arising out of the nature of the work during its progress or prior to its acceptance including those for well and faithfully completing the work and the whole thereof in the manner and time specified in the aforesaid Contract Documents; and also including those arising from actions of the elements, unforeseen difficulties or obstructions encountered in the prosecution of the work, suspension or discontinuance of the work, and all other unknowns or risks of any description connected with the work.
B. This AGREEMENT is subject to the provisions of Article 1.7 (commencing at Section 20104.50) of Division 2, Part 3 of the Public Contract Code regarding prompt payment of contractors by local governments. Article 1.7 mandates certain procedures for the payment of undisputed and properly submitted payment requests within 30 days after receipt, for the review of payment requests, for notice to Contractor of improper payment requests, and provides for the payment of interest on progress payment requests which are not timely made in accordance with that Article. This AGREEMENT hereby incorporates the provisions of Article 1.7 as though fully set forth herein.
C. At the request and expense of CONTRACTOR, securities equivalent to the amount withheld shall be deposited with AGENCY, or with a state or federally chartered bank in this state as the escrow agent, who shall then pay those moneys to CONTRACTOR upon Agency’s confirmation of CONTRACTOR’S satisfactory completion of this AGREEMENT. At any time during the term of this AGREEMENT CONTRACTOR may, at its own expense, substitute securities for funds otherwise withheld as retention (or the retained percentage) in accordance with Public Contract Code § 22300.
ARTICLE IV: Labor Code
AGENCY and CONTRACTOR acknowledge that this AGREEMENT is subject to the provisions of Division 2, Part 7, Chapter 1 (commencing with Section 1720) of the California Labor Code relating to public works and public agencies and agree to be bound by all the provisions thereof as though set forth fully herein. Full compensation for conforming to the requirements of the Labor Code and with other Federal, State and local laws related to labor, and rules, regulations and ordinances which apply to any work performed pursuant to this AGREEMENT is included in the price for all contract items of work involved.
This AGREEMENT is further subject to prevailing wage law, including, but not limited to, the following:
A. The CONTRACTOR shall pay the prevailing wage rates for all work performed under the AGREEMENT. When any craft or classification is omitted from the general prevailing wage determinations, the CONTRACTOR shall pay the wage rate of the craft or classification most closely related to the omitted classification. The CONTRACTOR shall
SECTION D – Page 4
CONTRACT INFORMATION AND DOCUMENT
forfeit as a penalty to AGENCY $200.00 or any greater penalty provided in the Labor Code for each Calendar Day, or portion thereof, for each worker paid less than the prevailing wage rates for any work done under the AGREEMENT in violation of the provisions of the Labor Code whether such worker is employed in the execution of the work by CONTRACTOR or by any Subcontractor under CONTRACTOR. In addition, CONTRACTOR shall pay each worker the difference between such prevailing wage rates and the amount paid to each worker for each Calendar Day, or portion thereof, for which each worker was paid less than the prevailing wage rate.
B. CONTRACTOR shall comply with the provisions of Labor Code Section 1777.5 concerning the employment of apprentices on public works projects, and further agrees that CONTRACTOR is responsible for compliance with Section 1777.5 by all of its subcontractors.
C. Pursuant to Labor Code § 1776, CONTRACTOR and any subcontractor shall keep accurate payroll records, showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by him or her in connection with this AGREEMENT. Each payroll record shall contain or be verified by a written declaration that it is made under penalty of perjury, stating both of the following: (1) The information contained in the payroll record is true and correct; and (2) The employer has complied with the requirements of Labor Code §§ 1811, and 1815 for any work performed by his or her employees on the public works project. The payroll records enumerated under subdivision (a) shall be certified and shall be available for inspection at all reasonable hours as required by Labor Code § 1776.
D. This AGREEMENT is further subject to 8-hour work day and wage and hour penalty law, including, but not limited to, Labor Code Sections 1810 and 1813, as well as California nondiscrimination laws, as follows:
CONTRACTOR shall strictly adhere to the provisions of the Labor Code regarding the 8- hour day and the 40-hour week, overtime, Saturday, Sunday and holiday work and nondiscrimination on the basis of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, marital status, sex or sexual orientation, except as provided in Section 12940 of the Government Code. Pursuant to the provisions of the Labor Code, eight hours’ labor shall constitute a legal day’s work. Work performed by CONTRACTOR’s employees in excess of eight hours per day, and 40 hours during any one week, must include compensation for all hours worked in excess of eight hours per day, or 40 hours during any one week, at not less than one and one-half times the basic rate of pay. CONTRACTOR shall forfeit as a penalty to AGENCY $25.00 or any greater penalty set forth in the Labor Code for each worker employed in the execution of the work by CONTRACTOR or by any Subcontractor of CONTRACTOR, for each Calendar Day during which such worker is required or permitted to the work more than eight hours in one Calendar Day or more than 40 hours in any one calendar week in violation of the Labor Code.
E. This AGREEMENT is subject to Public Contract Code Section 6109:
CONTRACTOR shall be prohibited from performing work on this project with a subcontractor who is ineligible to perform work on the project pursuant to Sections 1777.1 or 1777.7 of the Labor Code.
SECTION D – Page 5
CONTRACT INFORMATION AND DOCUMENT
ARTICLE V: Work Site Conditions
A. In compliance with and pursuant to Government Code Section 4215, AGENCY shall assume the responsibility, as between the parties to this AGREEMENT, for the timely removal, relocation, or protection of existing main- or trunk-line utility facilities located on the site of any construction project that is a subject of this AGREEMENT, if such utilities are not identified by AGENCY in the plans and specifications made a part of the invitation for bids. The Contract Documents shall include provisions to compensate CONTRACTOR for the costs of locating, repairing damage not due to the failure of CONTRACTOR to exercise reasonable care, and removing or relocating such utility facilities not indicated in the plans and specifications with reasonable accuracy, and for equipment on the project necessarily idled during such work.
CONTRACTOR shall not be assessed liquidated damages for delay in completion of the project, when such delay was caused by the failure of AGENCY or the owner of a utility to provide for removal or relocation of such utility facilities.
B. To the extent that the work requires trenches in excess of five feet (5’) and is estimated to cost more than $25,000, prior to any excavation, CONTRACTOR must provide the AGENCY, or a registered civil or structural engineer employed by the AGENCY to whom authority has been delegated to accept such plans, a detailed plan showing the design of shoring, bracing, sloping, or other provisions to be made for worker protection from the hazard of caving ground during the excavation of such trench or trenches. If such plan varies from the shoring system standards, the plan shall be prepared by a registered civil or structural engineer.
Nothing in this section shall be deemed to allow the use of a shoring, sloping, or protective system less effective than that required by the Construction Safety Orders.
C. This AGREEMENT is further subject to Public Contract Code Section 7104 with regard to any trenches deeper than four feet (4’) involved in the proposed work as follows:
CONTRACTOR shall promptly, and before the following conditions are disturbed, notify AGENCY, in writing, of any:
(1) Material that CONTRACTOR believes may be hazardous waste, as defined in Section 25117 of the Health and Safety Code, which is required to be removed to a Class I, Class II, or Class III disposal site in accordance with existing law.
(2) Subsurface or latent physical conditions at the site differing from those indicated by all available information provided prior to the deadline for submission of bids. (3) Unknown physical conditions at the site of any unusual nature, different materially from those ordinarily encountered and generally recognized as inherent in work of the character provided for in the contract.
AGENCY shall promptly investigate the conditions, and if it finds that the conditions do materially so differ, or involve hazardous waste, and cause a decrease or increase in CONTRACTOR’s cost of, or the time required for, performance of any part of the work, AGENCY shall issue a change order under the procedures described in this AGREEMENT.
In the event that a dispute arises between AGENCY and CONTRACTOR whether the conditions materially differ, or involve hazardous waste, or cause a decrease or increase in
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CONTRACT INFORMATION AND DOCUMENT
CONTRACTOR’s cost of, or time required for, performance of any part of the work, CONTRACTOR shall not be excused from any scheduled completion date provided in the AGREEMENT, but shall proceed with all work to be performed under the AGREEMENT.
CONTRACTOR shall retain any and all rights provided either by contract or by law which pertain to the resolution of disputes and protests between the contracting parties.
ARTICLE VI: Insurance
A. With respect to performance of work under this AGREEMENT, CONTRACTOR shall maintain, and shall require all of its subcontractors to maintain, insurance as required by Section E “Standard Specifications” of the Contract Documents.
B. This AGREEMENT is further subject to Workers’ Compensation obligations, including, but not limited to, California Labor Code Sections 1860 and 1861 as follows:
CONTRACTOR shall take out and maintain, during the life of this contract, Worker’s Compensation Insurance for all of CONTRACTOR’s employees employed at the site of improvement; and, if any work is sublet, CONTRACTOR shall require the subcontractor similarly to provide Worker’s Compensation Insurance for all of the latter’s employees, unless such employees are covered by the protection afforded by CONTRACTOR. CONTRACTOR and any of CONTRACTOR’s subcontractors shall be required to provide AGENCY with a written statement acknowledging its obligation to secure payment of Worker’s Compensation Insurance as required by Labor Code § 1861; to wit: ‘I am aware of the provisions of Section 3700 of the Labor Code which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of this contract.’ If any class of employees engaged in work under this AGREEMENT at the site of the Project is not protected under any Worker’s Compensation law, CONTRACTOR shall provide and shall cause each subcontractor to provide adequate insurance for the protection of employees not otherwise protected. CONTRACTOR shall indemnify and hold harmless AGENCY for any damage resulting from failure of either CONTRACTOR or any subcontractor to take out or maintain such insurance.
ARTICLE VII: Indemnification
To the fullest extent permitted by law, CONTRACTOR shall, at its sole cost and expense, fully defend, indemnify and hold harmless AGENCY, its authorized representatives and their respective subsidiaries, affiliates, members, directors, officers, employees and agents (collectively, the “Indemnitees”) from and against any and all claims, actions, demands, costs, judgments, liens, penalties, liabilities, damages, losses, and expenses, including but not limited to any fees of accountants, attorneys or other professionals (collectively “Liabilities”), arising out of, in connection with, resulting from or related to, any act, omission, fault or negligence of CONTRACTOR, CONTRACTOR’s Representative, or any of its officers, agents, employees, Subcontractors or Suppliers, or any person or organization directly or indirectly employed by any of them (Collectively, the “Indemnitors”), in connection with or relating to or claimed to be in connection with or relating to the work performed under this AGREEMENT.
If CONTRACTOR is a joint venture or partnership, each venturer or partner shall be jointly and severally liable for any and all of the duties and obligations of CONTRACTOR that are
SECTION D – Page 7
CONTRACT INFORMATION AND DOCUMENT
assumed under or arise out of this AGREEMENT. Each of such venturers or partners waives notice of the breach or non-performance of any undertaking or obligation of CONTRACTOR contained in, resulting from or assumed under this AGREEMENT, and the failure to give any such notice shall not affect or impair such venturer’s or partner’s joint and several liability hereunder.
ARTICLE VIII: Binding Effect
AGENCY and CONTRACTOR each binds itself, its partners, successors, assigns, and legal representatives to the other party hereto and to its partners, successors, assigns, and legal representatives in respect of all covenants, agreements, and obligations contained in the Contract Documents. This AGREEMENT is not assignable nor the performance of either party’s duties delegable without the prior written consent of the other party. Any attempted or purported assignment or delegation of any of the rights of obligations of either party without the prior written consent of the other shall be void and of no force and effect.
ARTICLE IX: Dispute Resolution
A. In the event of a dispute arising out of the terms of this AGREEMENT, including any action brought to declare the rights granted herein or to enforce any of the terms of this AGREEMENT, the party prevailing in such dispute shall be entitled to all reasonable costs and litigation expenses actually incurred, including fees of attorneys and expert witnesses. Any court action arising out of this AGREEMENT shall be filed in the Los Angeles County Superior Court. Any alternative dispute resolution proceeding arising out of this AGREEMENT shall be heard in the City of Los Angeles or the City of Los Alamitos, California.
B. AGENCY shall have full authority to compromise or otherwise settle any claim relating to this AGREEMENT or any part hereof at any time. AGENCY shall provide timely notification to CONTRACTOR of the receipt of any third-party claim relating to this AGREEMENT. AGENCY shall be entitled to recover its reasonable costs incurred in providing the notification required by this section.
C. This AGREEMENT is further subject to the provisions of Article 1.5 (commencing at Section 20104) of Division 2, Part 3 of the Public Contract Code regarding the resolution of public works claims of less than $375,000. Article 1.5 mandates certain procedures for the filing of claims and supporting documentation by Contractor, for the response to such claims by the Agency, for a mandatory meet and confer conference upon the request of Contractor, for mandatory nonbinding mediation in the event litigation is commenced, and for mandatory judicial arbitration upon the parties’ failure to resolve the dispute through mediation. This AGREEMENT hereby incorporates the provisions of Article
1.5 as though fully set forth herein.
ARTICLE X: Independent Contractor
CONTRACTOR is and shall at all times remain as to AGENCY, a wholly independent contractor.
Neither AGENCY nor any of its agents shall have control of the conduct of CONTRACTOR or any of CONTRACTOR’s employees, except as herein set forth. CONTRACTOR shall not at any time or in any manner represent that it or any of its agents or employees are in any manner agents or employees of AGENCY.
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CONTRACT INFORMATION AND DOCUMENT
ARTICLE XI: Taxes
CONTRACTOR is responsible for paying all retail, sales and use, transportation, export, import, special or other taxes and duties applicable to, and assessable against any work, materials, equipment, services, processes and operations incidental to or involved in this AGREEMENT.
The CONTRACTOR is responsible for ascertaining and arranging to pay such taxes and duties.
The prices established in this AGREEMENT shall include compensation for any taxes the CONTRACTOR is required to pay by laws and regulations in effect as of the execution of this AGREEMENT.
ARTICLE XII: Notices
All notices and communications shall be sent in writing to the parties at the following addresses:
AGENCY: RON NODA CONTRACTOR: [INSERT CONTACT]
CITY OF LOS ALAMITOS CONTRACTOR’S BUSINESS NAME
3191 Katella Avenue Mailing Street Address
Los Alamitos, CA 90720 City, State Zip Code
ARTICLE XIII: Entire Agreement
This AGREEMENT supersedes any and all other agreements, either oral or written, between the parties and contains all of the covenants and agreements between the parties pertaining to the work of improvements described herein. Each party to this AGREEMENT acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein, and that any other agreement, statement or promise not contained in this AGREEMENT shall not be valid or binding. Any modification of this AGREEMENT will be effective only if signed by the party to be charged.
The benefits and obligations of this AGREEMENT shall inure to and be binding upon the representatives, agents, partners, heirs, successors and assigns of the parties hereto. This AGREEMENT shall be construed pursuant to the laws of the State of California.
ARTICLE XIV: Authority to Contract
The signatories hereto represent that they are authorized to sign on behalf of the respective parties they represent and are competent to do so, and each of the parties hereto hereby irrevocably waives any and all rights to challenge signatures on these bases.
ARTICLE XV: General Provisions
A. All reports, documents or other written material (“written products” herein) developed by CONTRACTOR in the performance of this Agreement shall be and remain the property of AGENCY without restriction or limitation upon its use or dissemination by AGENCY. CONTRACTOR may take and retain copies of such written products as desired,
SECTION D – Page 9
CONTRACT INFORMATION AND DOCUMENT
but no such written products shall be the subject of a copyright application by CONTRACTOR.
B. In the performance of this Agreement, CONTRACTOR shall not discriminate against any employee, subcontractor, or applicant for employment because of race, color, creed, religion, sex, marital status, sexual orientation, national origin, ancestry, age, physical or mental disability, medical condition or any other unlawful basis.
C. The captions appearing at the commencement of the sections hereof, and in any paragraph thereof, are descriptive only and for convenience in reference to this Agreement.
Should there be any conflict between such heading, and the section or paragraph at the head of which it appears, the section or paragraph hereof, as the case may be, and not such heading, shall control and govern in the construction of this Agreement. Masculine or feminine pronouns shall be substituted for the neuter form and vice versa, and the plural shall be substituted for the singular form and vice versa, in any place or places herein in which the context requires such substitution(s).
D. The waiver by AGENCY or CONTRACTOR of any breach of any term, covenant or condition herein contained shall not be deemed to be a waiver of such term, covenant or condition or of any subsequent breach of the same or any other term, covenant or condition herein contained. No term, covenant or condition of this Agreement shall be deemed to have been waived by AGENCY or CONTRACTOR unless in writing.
E. Each right, power and remedy provided for herein or now or hereafter existing at law, in equity, by statute, or otherwise shall be cumulative and shall be in addition to every other right, power, or remedy provided for herein or now or hereafter existing at law, in equity, by statute, or otherwise. The exercise, the commencement of the exercise, or the forbearance of the exercise by any party of any one or more of such rights, powers or remedies shall not preclude the simultaneous or later exercise by such party of any of all of such other rights, powers or remedies.
IN WITNESS WHEREOF the parties hereto for themselves, their heirs, executors, administrators, successors, and assigns do hereby agree to the full performance of the covenants herein contained and have caused this AGREEMENT to be executed in duplicate by setting hereunto their names, titles, hands, and seals this Xth day of Month, 20XX (Council Action Date Here)
CONTRACTOR: Contractor’s Business Name
Contractor’s Sign Name, Title
Contractor’s License No. XXXXXX
Subscribed and sworn to this day of , 20 .
SECTION D – Page 10
CONTRACT INFORMATION AND DOCUMENT
NOTARY PUBLIC (SEAL)
AGENCY:
Mayor
City of Los Alamitos
Date
ATTESTED:
Windmera Quintanar, MMC, City Clerk
City of Los Alamitos
Date
APPROVED AS
TO FORM:
Michael S. Daudt, City Attorney
City of Los Alamitos
Date
( E X E C U T E I N D U P L I C A T E )
SECTION D – Page 11
CONTRACT INFORMATION AND DOCUMENT
PAYMENT BOND
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
WHEREAS, the City of Los Alamitos, as AGENCY has awarded to Contractor’s Business Name, as CONTRACTOR, a contract for the above-stated project;
AND WHEREAS, CONTRACTOR is required to furnish a bond in connection with the contract, to secure the payment of claims of laborers, mechanics, material persons, and other persons as provided by law; NOW THEREFORE, we, the undersigned CONTRACTOR and SURETY, are held and firmly bound unto AGENCY in the sum of [DESCRIBE VERBALLY; 100% OF TOTAL CONTRACT AMOUNT—TO BE INSERTED BY CONTRACTOR]Dollars ($XXX,XXX.XX) which is one hundred percent (100%) of the total contract amount for the above-stated project, for which payment well and truly to be made we bind ourselves, our heirs, executors and administrators, successors and assigns, jointly and severally, firmly by these presents.
THE CONDITIONS OF THIS OBLIGATION IS SUCH that if CONTRACTOR, its heirs, executors, administrators, successors, assigns or subcontractors, shall fail to pay any of the persons named in Civil Code Section 3181, or amounts due under the Unemployment Insurance Code with respect to work or labor withheld, and to pay over to the Employment Development Department from the wages of employees of the CONTRACTOR and its subcontractors pursuant to Section 13020 of the Unemployment Insurance Code, with respect to such work and labor, that the surety or sureties herein will pay for the same in an amount not exceeding the sum specified in this bond, otherwise the above obligation shall be void. In case suit is brought upon this bond, SURETY will pay reasonable attorneys’ fees to the plaintiffs and AGENCY in an amount to be fixed by the court.
This bond shall inure to the benefit to any of the persons named in Civil Code Section 3181 as to give a right of action to such persons or their assigns in any suit brought upon this bond.
The SURETY hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms of the contract or the specifications accompanying it shall in any manner affect SURETY’s obligations on this bond. The SURETY hereby waives notice of any such change, extension, alteration or addition and hereby waives the requirements of Section 2845 of the Civil Code as a condition precedent to any remedies AGENCY may have.
IN WITNESS WHEREOF the parties hereto have set their names, titles, hands, and seals this day of , 20 .
Contractor* Contractor’s Signer’s Name, Title
Contractor’s Business Name
Mailing Street Address
City, State, Zip Code
Telephone #
Surety*
*Provide CONTRACTOR and SURETY name, address and telephone number and the name, title, address and telephone number for the respective authorized representatives. Power of Attorney must be attached.
Subscribed and sworn to this day of , 20 .
NOTARY PUBLIC........................................................................................................ ....................................................................................................................................... (SEAL) (E X E C U T E I N D U P L I C A T E)
SECTION D – Page 12
CONTRACT INFORMATION AND DOCUMENT
FAITHFUL PERFORMANCE BOND
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
KNOW ALL PERSONS BY THESE PRESENTS That Contractor’s Business Name, hereinafter referred to as “CONTRACTOR” as PRINCIPAL, and
, a corporation duly organized and doing business under and by virtue of the laws of the State of California and duly licensed for the purpose of making, guaranteeing, or becoming sole surety upon bonds or undertakings as Surety, are held and firmly bound unto the CITY OF LOS ALAMITOS, CALIFORNIA, hereinafter referred to as the “AGENCY” in the sum of [DESCRIBE VERBALLY; 100% OF TOTAL CONTRACT AMOUNT—TO BE INSERTED BY CONTRACTOR]Dollars ($XXX,XXX.XX); which is one hundred percent (100%) of the total contract amount for the above stated project; lawful money of the United States of America for the payment of which sum, well and truly to be made, we bind ourselves, our heirs, executors, administrators, assigns and successors, jointly and severally, firmly by these presents.
THE CONDITIONS OF THIS OBLIGATION ARE SUCH, that whereas CONTRACTOR has been awarded and is about to enter into a Contract with AGENCY to perform all work required pursuantto the contract documents for the project entitled: ON-CALL SERVICES FOR CONCRETE REMEDIATIONCIP NO. 22/23-__ whichContractis by thisreference incorporated herein, and is required by AGENCY to give this Bond in connection with the execution of theContract; NOW, THEREFORE, if CONTRACTOR and his or her Subcontractors shall well and truly do and perform all the covenants and obligations of the Contract on his or her part to be done and performed at the times and in the manner specified herein including compliance with all Contract specifications and quality requirements, then this obligation shall be null and void, otherwise it shall be and remain in full force and effect;
PROVIDED, that any alterations in the work to be done, or in the material to be furnished, which may be made pursuantto the terms ofthe Contract,shall notin any way release CONTRACTOR or the Surety thereunder, nor shall any extensions of time granted under the provisions of the Contract release either CONTRACTOR or said Surety, and notice of such alterations of extensions of the Contractis hereby waived by said Surety.
In the event suit is brought upon this Bond by AGENCY and judgment is recovered, said Surety shall pay all costs incurred by AGENCY in such suit, including a reasonable attorney’s fee to be fixed by the Court.
IN WITNESS WHEREOF the parties hereto have set their names, titles, hands, and seals this day of , 20
Contractor* Name, Title of Signer
SURETY*………………………………………….
Contractor’s Business Name
……………………………………………
Mailing Street Address
……………………………………………
City, State, Zip Code
……………………………………………
Telephone #
……………………………………………
*Provide CONTRACTOR and SURETY name, address and telephone number and the name, title, address and telephone number for their respective authorized representatives. Power of Attorney must be attached.
SECTION D – Page 13
CONTRACT INFORMATION AND DOCUMENT
Subscribed and sworn to this_ day of , 20__
NOTARY PUBLIC.................................................................................................. (SEAL) (E X E C U T E I N D U P L I C A T E)
SECTION D – Page 14
CONTRACT INFORMATION AND DOCUMENT
MAINTENANCE BOND
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
KNOW ALL PERSONS BY THESE PRESENTS THAT WHEREAS, the City of Los Alamitos, as AGENCY has awarded to Contractor’s Business Name, as CONTRACTOR, a contract for the abovestated project.
AND WHEREAS, CONTRACTOR is required to furnish a bond in connection with the contract guaranteeing maintenance thereof;
NOW, THEREFORE, we, the undersigned CONTRACTOR and SURETY, are held firmly bound unto AGENCY in the sum of DESCRIBE VERBALLY; 50% OF TOTAL CONTRACT AMOUNT—TO BE INSERTED BY CONTRACTOR]Dollars ($XXX,XXX.XX), which is fifty percent (50%) of the total contract amount for the above-stated project to be paid to AGENCY, its successors and assigns, for which payment well and truly to be made, we bind ourselves, our heirs, executors and administrators, successors and assigns, jointly and severally, firmly by these presents.
THE CONDITIONS OF THIS OBLIGATION ARE SUCH that if CONTRACTOR shall remedy without cost to AGENCY any defects which may develop during a period of one (1) year from the date of recordation of the Notice of Completion of the work performed under the contract, provided such defects are caused by defective or inferior materials or work, then this obligation shall be void; otherwise it shall be and remain in full force and effect. In case suit is brought upon this bond, SURETY will pay reasonable attorneys’ fees to the AGENCY in an amount to be fixed by the court.
IN WITNESS WHEREOF the parties hereto have settheir names, titles, hands, and seals this day of
......................................, 20 .
Contractor* Contractor’s Signer’s Name, Title
Contractor’s Business Name
Mailing Street Address
City, State, Zip Code
Telephone #
SURETY*
*Provide CONTRACTOR and SURETY name, address and telephone number and the name, title, address and telephone number for their respective authorized representatives. Powers of Attorney must be attached.
Subscribed and sworn to this ........... day of..............................., 20__.
NOTARY PUBLIC.................................................................................................. ................................................................................................................................. (SEAL) (EXECUTE IN DUPLICATE)
SECTION D – Page 15
CONTRACT INFORMATION AND DOCUMENT
NON-COLLUSION AFFIDAVIT
The undersigned declares:
I am the of , the party making the foregoing
bid.
The bid is not made in the interest of, or on behalf of, any undisclosed person, partnership, company, association, organization, or corporation. The bid is genuine and not collusive or sham. The bidder has not directly or indirectly induced or solicited any other bidder to put in a false or sham bid. The bidder has not directly or indirectly colluded, conspired, connived, or agreed with any bidder or anyone else to put in a sham bid, or to refrain from bidding. The bidder has not in any manner, directly or indirectly, sought by agreement, communication, or conference with anyone to fix the bid price of the bidder or any other bidder, or to fix any overhead, profit, or cost element of the bid price, or of that of any other bidder. All statements contained in the bid are true. The bidder has not, directly or indirectly, submitted his or her bid price or any breakdown thereof, or the contents thereof, or divulged information or data relative thereto, to any corporation, partnership, company, association, organization, bid depository, or to any member or agent thereof, to effectuate a collusive or sham bid, and has not paid, and will not pay, any person or entity for such purpose.
Any person executing this declaration on behalf of a bidder that is a corporation, partnership, joint venture, limited liability company, limited liability partnership, or any other entity, hereby represents that he or she has full power to execute, and does execute, this declaration on behalf of the bidder.
I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct and that this declaration is executed on [date], at [city], [state].
Signature of Declarant
Printed Name of Declarant
SECTION D – Page 16
CONTRACT INFORMATION AND DOCUMENT
WORKERS’ COMPENSATION INSURANCE CERTIFICATE
The Contractor shall execute the following form as required by the California Labor Code, Sections 1860 and 1861:
I am aware of the provisions of Section 3700 of the Labor Code which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of this contract.
DATE: Contractor’s Business Name .
(Contractor)
By:
(Signature)
(Title)
Attest:
By:
(Signature)
(Title)
Note: See Section 5 Legal Relations and Responsibilities, Subsection 5-4 of the Standard Specifications for insurance carrier rating requirements.
SECTION D – Page 17
CONTRACT INFORMATION AND DOCUMENT
ENDORSEMENTS TO INSURANCE POLICY
Name of Insurance Company:
Policy Number:
Effective Date:
The following endorsements are hereby incorporated by reference into the attached Certificate of Insurance as though fully set forth t h e r e o n :
1. The naming of an additional insured as herein provided shall not affect any recovery to which such additional insured would be entitled under this policy if not named as such additional insured, and
2. The additional insured named herein shall not be held liable for any premium or expense of any nature on this policy or any extensions thereof, and
3. The additional insured named herein shall not by reason of being so named be considered a member of any mutual insurance company for any purpose whatsoever, and
4. The provisions of the policy will not be changed, suspended, canceled or otherwise terminated as to the interest of the additional insured named herein without first giving such additional insured twenty (20) days’ written notice.
5. Any other insurance held by the additional insured shall not be required to contribute anything toward any loss or expense covered by the insurance, which is referred to by this certificate.
6. The company provided insurance for this certificate is a company licensed to do business in the State of California with a Best’s rating of A+ VIII or greater.
It is agreed that the City of Los Alamitos, its officers and employees, are included as Additional Insureds under the contracts of insurance for which the Certificate of Insurance is given.
Authorized Insurance Agent
Date:
SECTION D – Page 18
CONTRACT INFORMATION AND DOCUMENT
STATEMENT REGARDING INSURANCE COVERAGE
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
The undersigned representative of Bidder hereby certifies that he/she has reviewed the insurance coverage requirements specified in 5.4 INSURANCE of Section E, Standard Specifications. Should Bidder be awarded the contract for the work, the undersigned further certifies that Bidder can meet all of these specification requirements for insurance including insurance coverage of his/her subcontractors.
NAME OF BIDDER: .......................................................................................................
MAILING ADDRESS: ....................................................................................................... ....................................................................................................... .......................................................................................................
AUTHORIZED SIGNATURE: .......................................................................................................
TITLE: .......................................................................................................
DATE: .......................................................................................................
SECTION D – Page 19
CONTRACT INFORMATION AND DOCUMENT
STATEMENT REGARDING CONTRACTOR’S LICENSING LAWS
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
[Business & Professions Code § 7028.15]
[Public Contract Code § 20103.5]
I, the undersigned, certify that I am aware of the following provisions of California law and that I, or the entity on whose behalf this certification is given, hold a currently valid California contractor’s license as set forth below:
Business & Professions Code § 7028.15:
a) It is a misdemeanor for any person to submit a bid to a public agency to engage in the business or act in the capacity of a contractor within this state without having a license therefor, exceptin any ofthe following cases:
(1)The person is particularly exempted from this chapter. (2)The bid is submitted on a state project governed by Section 10164 of the Public Contract Code or on any local agency project governed by Section 20104 [now § 20103.5] of the Public Contract Code.
b) If a person has been previously convicted of the offense described in this section, the court shall impose a fine of 20 percent of the price of the contract under which the unlicensed person performed contracting work, or four thousand five hundreddollars ($4,500), whichever is greater, or imprisonment in thecounty jail for not less than 10 days nor more than six months, or both.
In the event the person performing the contracting work has agreed to furnish materials and labor on an hourly basis, “the price of the contract” for the purposes of this subdivision means the aggregate sum of the cost of materials and laborfurnished and the cost of completing the work to be performed.
c) This section shall not apply to a joint venture license, as required by Section 7029.1.
However, at the time of making a bid as a joint venture, each person submitting the bid shall be subjectto thissection with respectto his/her individuallicenser. d) This section shall not affect the right or ability of a licensed architect, land surveyor, or registered professional engineer to form joint ventures with licensed contractorsto renderservices within the scope of their respective practices. e) Unless one of the foregoing exceptions applies, a bid submitted to a public agency by a contractor who is not licensed in accordance with this chapter shall be considered nonresponsive and shall be rejected by the public agency. Unless one of the foregoing exceptions applies, a local public agency shall, before awarding a contract or issuing a purchase order, verify that the contractor was properly licensed whenthe contractor submitted the bid. Notwithstanding any other provision of law, unless one of the foregoing exceptions applies, the registrar may issue a citation to any public officer or employee of a public entity who knowingly awards a contract or issues a purchase order to a contractor who is not licensed pursuant to this chapter. The amount of civil penalties, appeal, and finality of such citations shall be subject to Sections 7028.7 to 7028.13, inclusive. Any contract awarded to, or any purchase order issued to, as contractor who is not licensed pursuant to this chapter is void.
SECTION D – Page 20
CONTRACT INFORMATION AND DOCUMENT
f) Any compliance or noncompliance with subdivision (e) of this section, as added by Chapter 863 of the Statutes of 1989, shall not invalidate any contract or bid awarded by a public agency during which time that subdivision was in effect. g) A public employee or officer shall not be subject to a citation pursuant to thissection if the public employee, officer, or employing agency made an inquiry to the board for the purposes of verifying the license status of any person or contractor and the board failed to respond to the inquiry within three business days. For purposes ofthissection, a telephone response by the board shall be deemed sufficient.
Public Contract Code § 20103.5:
In all contracts subject to this part where federal funds are involved, no bid submitted shall be invalidated by the failure of the bidder to be licensed in accordance with the laws of this state.
However, at the time the contract is awarded, the contractor shall be properly licensed in accordance with the laws of this state. The first payment for work or material under any contract shall not be made unless and until the Registrar of Contractors verifies to the agency that the records of the Contractors’ State License Board indicate that the contractor was properly licensed at the time the contract was awarded. Any bidder or contractor not so licensed shall be subject to all legal penalties imposed by law, including, but not limited to, any appropriate disciplinary action by the Contractors’ State License Board. The agency shall include a statement to that effect in the standard form of pre-qualification questionnaire and financial statement. Failure of the bidder to obtain proper and adequate licensing for an award of a contract shall constitute a failure to execute the contract and shall result in the forfeiture of the security of the bidder.
ContractorsLicenseNumber:
License ExpirationDate:
AuthorizedSignature:
Date:
SECTION E – Page 1
STANDARD SPECIFICATIONS
SECTION E
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
INTHECITYOFLOSALAMITOS,CALIFORNIA
STANDARD SPECIFICATION
SECTION E – Page 2
STANDARD SPECIFICATIONS
STANDARD SPECIFICATIONS
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
IN THE CITY OF LOS ALAMITOS, CALIFORNIA
0-1 STANDARD SPECIFICATIONS
Except as hereinafter amended, the provisions of the 2021 Edition of the “Green Book,” Standard Specifications for Public Works Construction (“SSPWC”), with the latest Supplements, prepared and promulgated by the Southern California Chapters of the American Public Works Association and the Associated General Contractors of America, and these modifications thereto are adopted as the “Standard Specifications” for the Agency. These Standard Specifications will be numbered as Sections 0 through 800 per the SSPWC.
0-2 NUMBERING OF SECTIONS
The numbering of sections and subsections in these amendments and modifications are compatible with the numbering of sections in the SSPWC.
0-3 AMENDMENTS ANDMODIFICATIONS
The following sections of the SSPWC are amended as provided herein. In the event of any inconsistencies between the amendments outlined herein and the SSPWC, these amendments shall control. 1-2 TERMS AND DEFINITIONS
Add the following:
Agent—Shall include persons and companies, other than the Contractor, retained by the City to perform design and construction services in relation to the Work.
Acceptance—The Agency’s formal written acceptance of a project that has been completed in all respects in accordance with the plans and specifications and any modifications thereof.
City—The City of Los Alamitos, California, as the Agency and Owner.
City Council—City Council of the City of Los Alamitos, California.
Construction Manager—Persons and/or company retained by the City to perform construction management services.
Design Engineer—Persons and/or company retained by the City to perform engineering design services.
Due Notice—A written notification, provided in due time, of a proposed action, where the contract requires such notification within a specified time (usually 48 hours or two working days) prior to the commencement of the contemplated action.
Engineer—The City Engineer of the City of Los Alamitos, or his/her authorized representative.
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STANDARD SPECIFICATIONS
Geotechnical Engineer—Person licensed to practice Soils Engineering or Geotechnical Engineering pursuant to the laws of the State of California and retained by the Agency during construction.
Prompt—The briefest interval of time required for a considered reply, including time required for approval by a governing body.
Standard Plans—“Standard Plans for Public Works Construction” - Latest edition of the Southern California Chapter of the American Public Works Association.
State Standard Specifications (“SSS”)—Standard Specifications prepared by the State of California, Business and Transportation Agency, Department of Transportation.
State Standard Plans (“SSP”)—Standard Plans prepared by State of California, Business and Transportation Agency, Department of Transportation.
Working Days—Any days, except: (1) Saturdays, Sundays, legal holidays on which Los Alamitos City Hall is closed for business; (2) days when work is suspended by the Engineer for reasons unrelated to the performance of the contractor, and provided in Subsections 6-3 and 6-3.1; and (3) days determined to be non-working in accordance with Section 6-3 “Time of Completion”. 1-3.3 INSTITUTIONS
Add the following:
AGCA Associated General Contractors of America
ASME American Society of Mechanical Engineers
CRSI Concrete Reinforcing Steel Institute
CSI Construction Specifications Institute
NFPA National Fire Protection Association
SSS State of California Standard Specifications, latest edition, Department of Transportation SSP State of California Standard Plans, latest edition, Department of Transportation.
SSPWC Standard Specifications for Public Works Construction, as specified in Subsection 0-1 1-6 BIDDING AND SUBMISSION OF THE BID
1-6.2 SUBCONTRACTOR LISTING
Subcontracting of more than one-half of one percent of the work for which no Subcontractor was designated in the original Bid will be allowed only in cases of public emergency or necessity and only after the Engineer makes a written finding of circumstances constituting public emergency or necessity.
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STANDARD SPECIFICATIONS
The Contractor must obtain written consent of the City Council to substitute a Subcontractor designated in the original Bid, to permit any subcontract to be assigned or transferred, or to otherwise allow a subcontract to be performed by anyone other than the originally designated Subcontractor.
A violation of any of the above provisions will be considered a violation of the Contract, and the City may cancel the Contract and collect appropriate damages or assess the Contractor a penalty of not more than ten (10) percent of the subcontract involved.
If subcontracted work is not being performed in a satisfactory manner, the City will notify the Contractor of the need to take corrective action and the Engineer may report the facts to the City Council. Upon order by City Council and the Contractor’s receipt of written instructions from the Engineer, the Subcontractor shall immediately be removed from the Work and may not again be employed on the Work. 1-7 AWARD AND EXECUTION OF THECONTRACT
1-7.1 GENERAL
The City reserves the right to reject any or all proposals.
The Contract will be awarded, if at all, to the lowest responsible and responsive Bidder determined as provided on the Proposal Form, whose proposal complies with all the requirements prescribed. Such award, if made, will be made within the number of days stated in the proposal form. Refusal or failure to deliver the executed contract, bonds, or insurance in the form provided in the Contract and approved by the Agency’s attorney within the time provided herein shall be cause, at the Agency’s option, for the annulment of the award and forfeiture of the bid security. In such event, the Agency may successively award the Contract to the next lowest responsible and responsive Bidder until a properly executed Contract, bonds, and insurance is obtained, or it may at any time reject all remaining bids and proceed as provided by law.
The refusal or failure of a successive lowest responsible and responsive Bidder to execute the Contract may, at the Agency’s option, result in an annulment of the award to that Bidder and the forfeiture of that Bidder’s bid security. The periods of time specified above within which the award of the Contract may be made shall be subject to extension for such further period as may be agreed upon in writing between the Agency and the concerned Bidder.
The Agency reserves the right to waive any irregularities.
Within ten (10) calendar days after the date of the Notice of Award, the Contractor shall execute and return the following contract documents to the Agency:
Contract Agreement (in duplicate)
Faithful Performance Bond (in duplicate)
Maintenance Bond (in duplicate)
Payment Bond (in duplicate)
Public Liability and Property Damage Insurance Certificate (two original) Additionally Insured Endorsement
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STANDARD SPECIFICATIONS
Workers’ Compensation Insurance Certificate (two original) A corporation to which an award is made may be required, before the Contract agreement is executed by the Agency, to furnish evidence of its corporate existence, of its right to enter into contracts in the State of California, and that the officers signing the contract and bonds for the corporation have the authority to do so.
1-7.2 CONTRACT BONDS
The PAYMENT BOND shall remain in force until thirty-five (35) days after the date of recordation of the Notice of Completion. The FAITHFUL PERFORMANCE BOND shall remain in force until the date of recordation of the Notice of Completion. The MAINTENANCE BOND shall remain in force until one (1) year after the date of recordation of the Notice of Completion.
All bonds must be accompanied by a Power of Attorney
SECTION 2 – SCOPE OF THE WORK
2-1 WORK TO BE DONE
Any plan or method of work suggested by the Agency or the Engineer to the Contractor but not specified or required, if adopted or followed by the Contractor in whole or in part, shall be used at the risk and responsibility of the Contractor; and the Agency and the Engineer shall assume no responsibility therefore and in no way be held liable for any defects in the work which may result from or be caused by use of such plan or method of work.
The work includes, but is not necessarily limited to, the following items:
Services shall include sidewalk assessment and remediation of concrete sidewalk trip hazards from ½” and up to 2” at surveyed/pre-designated work areas within the Agency. Remediation services must remove trip hazards completely, from one end of the raised sidewalk joint to the other, if applicable, leaving zero point of differential between concrete slabs. Any panels inspected and deemed not to be at a zero point of differential by Agency shall be repaired to the required specifications at no additional cost to Agency.
Remediation services shall not cause any damage to landscaping, retaining walls, curbs, sprinkler heads, utility covers or any other objects adjacent to sidewalks. Contractor must repair each sidewalk trip hazard without damage or visible marking to adjacent slabs or curbs.
Damage to irrigation sprinklers and piping of any property shall be repaired by Contractor within 48 hours. Damage to lawn areas of any property shall be repaired by Contractor within a reasonable time as approved by the Contract Officer. Damage to buildings, fences, block walls, or existing concrete areas as a result of the work shall be repaired by Contractor within ten (10) calendar days. If Contractor fails to comply with these requirements, the Agency shall arrange for the work to be done by other means and will deduct 150% of the cost from the Contractor’s next pay estimate.
Must comply with Cal-OSHA Regulations including but not limited to permissible exposure limit of 50 micrograms per cubic meter (Cal-OSHA Section 1523.3. Occupational Exposure to Respirable Crystalline Silica).
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STANDARD SPECIFICATIONS
2-1.2 EQUIPMENT/PROCESS REQUIRED
Contractor shall use a horizontal saw cutting technique that guarantees a planar surface after cutting.
Contractor shall guarantee specified repair slope (1:8 or 1:12 based upon requirement outlined by the Agency) is achieved. If defined slope is not achieved, Contractor shall repair to specification at no additional charge to Agency, within 24 hours of discovery.
No water cooling is allowed which creates slurry and contaminates storm drains and causes excessive environmental impact. Contractors shall use a dust abatement system that limits the dust emitted from the cutting.
The Contractor shall guarantee the removed trip hazard will have a uniform appearance and texture.
The finished surface shall have a coefficient of friction of at least 0.6 and show via previous testing that the technique used yields the specified coefficient of friction.
The hardware shall be flush to the ground and capable of working at any angle and perform trip hazard removal in hard-to-reach areas, around obstacles, on narrow walkways, next to fences and retaining walls or buildings.
Grinding or pulverization of the concrete is NOT acceptable or allowed, causing micro-cracks or weaking the concrete panel. Contractor’s trip hazard shall not leave ridges or grooves that could hold water and prevent drainage of rain water or irrigation.
Sidewalk repair equipment and all other items incidental to the Services shall not be left or stored on the sidewalk or on private property while not in use.
A dust abatement system must be used to limit the dust being emitted.
Contractor shall provide clean-up services for all remediation services performed, at no additional cost to Agency. Clean-up services shall consist of full clean-up of all debris after each concrete shaving is performed. All costs incurred for disposal of waste material shall be included in unit cost and not invoiced/paid separately.
2-1.3 CONSTRUCTION HOURS
Construction activities are not permitted before 8am or after 5pm. Concrete slicing, which exceeds a noise level of 80-85 dBA, shall only be permitted between 10am and 3pm, unless otherwise approved by Agency with an “after hours” Agency encroachment permit. 2-1.4 SIDEWALK ASSESSMENT AND DATA COLLECTION
Contractor shall inspect sidewalks and provide a written inspection report. Agency shall determine the area to inspect. The inspection report shall at a minimum include identification, location and description of each problem and recommended action to take. The Agency shall review the
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STANDARD SPECIFICATIONS
assessment and approve locations for Contractor to remediate. The Agency may change the format of the inspection report.
Contractor shall utilize a data collection device that records the details of all services performed, and transmit the data electronically. The recording device must be able to record sizes of trip hazards, GPS coordinates, hazard locations plotted to a map, address, and also provide this data electronically in order to integrate into a GIS system. Contractor shall submit detailed invoices setting forth the services performed in accordance with the formula for saw cutting calculations. All invoices must show the cut depth, size, length, width and address location.
The City will randomly inspect repairs to ensure the repair specifications are being met. If less than 95% of the inspected repairs meet the repair specifications, further inspection will be completed to determine the actual quantity of failed repairs. The Contractor, at no cost to the City, is responsible to fix any failed repairs. The City will not be obligated to pay for services that do not meet the repair specifications.
2-1.5 ON CALL SERVICES
Any “On Call” service shall be indicated by written request produced by the Project Manager with a description of the work to be performed and the time desired for completion. All tasks shall be carried out in conformity with all provisions of this Agreement.
Contractor shall prepare a written description of the requested tasks including all components and subtasks; the costs to perform the task, using the itemized fees in Exhibit C, Schedule of Compensation. Whenever a requested task is provided for in Exhibit C, explain how the cost was determined and a schedule for completion of the task which shall all collectively be referred to as the “Task Proposal”.
The Project Manager shall in writing approve, modify or reject the Task Proposal and may issue a “Notice to Proceed”.
The task shall be performed at a cost not to exceed the Task Budget.
Contractor shall complete the task and deliver all deliverables to the Project Manager by the Task Completion Date. To the extent practicable and unless as otherwise specified in the Task Proposal approved by the Project Manager, each Task shall be completed within one working day of issuance of the “Notice to Proceed”.
2-2 PERMITS
Prior to the start of any work, the Contractor shall apply for and receive any applicable City, County, State, and Federal permits.
2-3 RIGHT-OF-WAY
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STANDARD SPECIFICATIONS
When the Contractor arranges for additional work areas and facilities temporarily required by him/her, he/she shall provide the Agency with proof that the additional work areas and/or facilities have been left in a condition satisfactory to the owner(s) of said work areas and/or facilities prior to acceptance of the work. 2-4 COOPERATION AND COLLATERAL WORK
Contractor shall coordinate his/her work so as to minimize disruption to ongoing or scheduled private development projects in the project area.
2-7 CHANGES INITIATED BY THE AGENCY
2-7.1 GENERAL
All final locations determined in the field, and any deviations from the Plans and Specification, shall be marked in red on the documents to show the as-built conditions. Contractor shall maintain a complete and accurate record of all changes of construction from that shown in these plans and specifications for the purpose of providing a basis for construction record drawings. No changes shall be made without prior written approval of the Engineer. Upon completion of the Project, Contractor shall deliver this record of all construction changes to the Engineer along with a letter which declares that other than these noted changes “the Project was constructed in conformance with the Contract Documents”. Final payment will not be made until this requirement is met.
As the figured dimensions shown on the drawings and in the specifications of the Contract may not in every case agree with scaled dimensions, the figured dimensions shall be followed in preference to the scaled dimensions, and drawings to a large scale shall be followed in preference to the drawings to a small scale.
Should it appear that the work to be performed, or any related matter, are not sufficiently detailed or explained in the Contract documents, the Contractor shall apply to the Engineer for such further explanations as necessary, and shall conform to such further explanations provided by the Engineer as part of the Contract to the extent that it is consistent with the terms of the Contract.
Caution: The engineer preparing these plans will not be responsible or liable for unauthorized changes to or uses of these plans. All changes to the plans must be approved in writing by the Engineer.
SECTION 3 – CONTROL OF THE WORK
3-3 SUBCONTRACTORS
All persons engaged in the Work, including Subcontractors and their employees, will be considered employees of the Contractor. The Contractor will be held responsible for their work. The Agency will deal directly and solely with the Contractor and make all payments to the Contractor. 3-5 INSPECTION
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STANDARD SPECIFICATIONS
The Agency shall inspect for compliance with requirements for 8-hour days and 40-hour weeks on normal working days. The Contractor shall reimburse the Agency, at rates established by the Agency, for any additional inspection, including inspection on legal holidays. 3-10 SURVEYING
3-10.1 GENERAL
The Contractor shall be responsible for all survey and layout of work.
The line and grades for construction will be parallel to and offset from the position of the work. From the established lines and grades, the Contractor shall extend the necessary lines and grades for construction of the work and shall be responsible for the correctness of same. 3-12 WORK SITE MAINTENANCE
3-12.1 GENERAL
3-12.1.1 WORK AREA APPEARANCE
The Contractor shall maintain a neat appearance to the Work.
All unsuitable construction materials and rubbish and debris shall be regularly removed from the job site, be transported to a suitable location, and be disposed of in a proper and legal manner.
In any area visible to the public, the following shall apply:
1. Broken concrete and debris developed during clearing and grubbing shall be disposed of weekly.
2. The Contractor shall furnish trash bins for all debris from structure construction. All debris shall be placed in trash bins daily.
3. Forms or false work that are to be re-used shall be neatly stacked concurrent with their removal.
4. Forms and false work that are not to be re-used shall be disposed of with their removal.
5. Wash down from concrete trucks shall be at one location. Concrete from wash down procedures shall be removed from the site weekly.
3-12.3 NOISE CONTROL
A noise level limit of 85 dba at a distance of fifty (50) feet shall apply to all construction equipment on or related to the job, whether owned by the Contractor or not. The use of excessively loud warning signals shall be avoided except in those cases where required for the protection of personnel.
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10 STANDARD SPECIFICATIONS
The Contractor shall arrange and maintain a secure storage site for all equipment and materials. All equipment and unused materials shall be returned to this site at the end of each work day. 3-12.6 WATER POLLUTION CONTROL
3-12.6.1 GENERAL
This item shall consist of preparation, implementation and compliance with a storm water pollution prevention plan (SWPPP) for the project, if applicable. 3-12.6.2 BEST MANAGEMENT PRACTICES (BMPs)
All storm water pollution prevention measures shall be in accordance with the submitted SWPPP. In the event circumstances during the course of construction require changes to the original SWPPP, a revised plan shall be promptly submitted to the Agency’s representative in each instance. No responsibility shall accrue to the Agency as a result of the plan or as a result of knowledge of the plan. All work installed by the Contractor in connection with the SWPPP but not specified to become a permanent part of the project shall be removed and the site restored in so far as practical to its original condition prior to completion of construction or when directed by the Agency’s representative. 3-12.6.3 STORM WATER POLLUTION PREVENTION PLAN (SWPPP)
If deemed necessary by the City, Contractor shall submit to the engineer a completed and signed SWPPP at the preconstruction conference. The plan may utilize the practices recommended in the California Storm Water Best Management Practices Handbook dated January 2015, available from California Stormwater Quality Association (CSQA), and online at http://www.cabmphandbooks.net/ . The plan shall be consistent with the construction General Permit, issued by the State Water Resources, Control Board, through submittal of the Notice of Intent (NOI).
If construction will occur between October 15 and April 15 (considered as the rainy season per the Agency’s Ordinance), a wet weather erosion control plan must be submitted. Additionally, Best Management Practices (BMPs) implemented during the Agency’s rainy season shall include but not be limited to those appropriate for wet weather conditions.
3-12.6.5 PAYMENT
Unless otherwise indicated in the Special Provision, measurement and payment for Storm Water Pollution Prevention Measures, as described herein, shall be included in the items of Work requiring storm water pollution prevention measures as indicated in the project Special Provisions. Such payment shall be considered full compensation for all labor, materials, tools, and equipment for completion, and implementation and compliance with the SWPPP.
3-13 COMPLETION, ACCEPTANCE, AND WARRANTY
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11 STANDARD SPECIFICATIONS
3-13.3 WARRANTY
The Contractor shall warrant and guarantee the entire Work and all parts thereof, including that performed and constructed by subcontractors, and others employed directly or indirectly on the Work, against faulty or defective materials, equipment or workmanship for the maximum period provided by law. In addition thereto, for a period of one (1) year commencing on the date of acceptance of the Work, the Contractor shall, upon the receipt of notice in writing from the Agency, promptly make all repairs arising out of defective materials, workmanship or equipment and bear the cost thereof. The Agency is hereby authorized to make such repairs and the Contractor and Surety shall bear the cost thereof if, ten (10) days after the giving of such notice to the Contractor, the Contractor has failed to make or undertake with due diligence the repairs; provided, however, that, in the case of an emergency where, in the opinion of the Agency, delay could cause serious loss or damage, repairs may be made without notice being sent to the Contractor or Surety, and all expense in connection therewith shall be charged to the Contractor and Surety.
For the purpose of this article “Acceptance of the Work” shall mean the acceptance of the Work by the Agency in accordance with Subsection 3-13.2 but not for the purpose of extinguishing any covenant or agreement or agreement on the part of the Contractor to be performed or fulfilled under this Contract, which has not in fact been performed or fulfilled at the time of such acceptance all of such covenants and agreements, shall continue to be binding on the Contractor until they have been fulfilled.
The effective date of Acceptance of the Work and commencement of the Guarantee shall be the date of acceptance of the Notice of Completion by the City Council. 3-13.3.4 GENERAL GUARANTY
The Contractor shall remedy any defects in the Work and pay for any damage to other work resulting therefrom, which shall appear within a period of one year from the date of final acceptance of the Work unless a longer period is specified. The Agency will give notice of observed defects with reasonable promptness.
SECTION 4 – CONTROL OF MATERIALS
4-1 GENERAL
The Contractor and all subcontractors, suppliers, and vendors, shall guarantee that the entire Work will meet all requirements of this Contract as to the quality of materials, equipment, and workmanship. The Contractor, at no cost to the Agency, shall make any repairs or replacements made necessary by defects in materials, equipment, or workmanship that become evident within one year after the date of recordation of the Notice of Completion. Within this one year period, the Contractor shall also restore to full compliance with the requirements of this Contract any portion of the Work which is found not to meet those requirements. The Contractor shall defend, indemnify, and hold the Agency, its officers, agents, and employees harmless from claims of any kind due to injuries or damages arising, directly or indirectly, from said defects or noncompliance.
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STANDARD SPECIFICATIONS
The Contractor shall make all repairs, replacements, and restorations within thirty-five (35) days after the date of the Engineers’ written notice.
If, in the opinion of the Engineer, the defective work is not of sufficient magnitude or importance to make the work dangerous or undesirable, or if, in the opinion of the Engineer, the removal of such work is impractical or will create conditions which are dangerous or undesirable, the Agency shall have the right and authority to retain such work instead of requiring it to be removed and reconstructed, but will make such deductions thereof in the payments due or to become due to the Contractor as the Agency may deem just and reasonable.
4-4 TESTING
Except as elsewhere specified, the Agency will bear the cost of testing material and/or workmanship which meet or exceed the requirements indicated in the Standard Specifications and the Special Provisions. The Contractor shall bear the cost of all other tests, including the retesting of material or workmanship that fails to pass the first test.
4-6 TRADE NAMES
Approval of equipment and materials offered as equivalents to those specified must be obtained prior to the opening of bids as set forth in the Instructions to Bidders.
Along with information supplied by the Contractor regarding equivalency of the proposed item, the Contractor shall clearly identify all deviations from the specified item. Deviations discovered by the Engineer after acceptance of an “or equal” item which were not identified by the Contractor with his/her submittal shall be cause for rejection of the “or equal” item. Contractor shall be due no additional compensation in time or money for acceptance or rejection of a proposed “or equal” item and subsequent replacement with the item specified. Contractor shall pay cost to Agency for items requiring more than two submittals and analysis of any shop drawing which requires more than a general review of an “or equal” item.
SECTION 5 – LEGAL RELATIONS AND RESPONSIBILITIES
5-3 LABOR
5-3.1 GENERAL
The Contractor shall ensure unlimited access to the job site for all Equal Opportunity Compliance officers.
Every Contractor and Subcontractor shall keep an accurate record showing the name, occupation, and the actual per diem wages paid to each worker employed by him/her in connection with the public work. The record shall be kept open at all reasonable hours to the inspection of the body awarding the Contract and to the Division of Labor Law Enforcement.
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STANDARD SPECIFICATIONS
5-3.4.1 OVERTIME AND SHIFT WORK
The Contractor may establish overtime and shift work as a regular procedure only with the written permission of the Engineer. Such permission may be revoked at any time. No work other than overtime and shift work established as a regular procedure shall be done between the hours of 4:00 p.m. and 7:30 a.m., nor on Saturdays, Sundays or legal holidays, except such work as is necessary for the proper care and protection of the work already performed or except in case of an emergency.
All costs for overtime inspection, except those occurring as a result of overtime and shift work established as a regular procedure, shall be paid by the Contractor. Overtime inspection shall include inspection required during holidays observed by the AGC and Trade Unions, Saturdays, Sundays, and any weekday between the hours of 4:00 p.m. and 7:30 a.m.. Such costs will include but will not necessarily be limited to engineering, inspection, general supervision and other overhead expenses that are directly chargeable to the overtime work. The Agency shall deduct all such charges from payments due the Contractor.
5.4 INSURANCE
5-4.2 GENERAL LIABILITY INSURANCE
5-4.2.1 GENERAL
CONTRACTOR and AGENCY agree that Agency, its employees, agents and officials should, to the extent permitted by law, be fully protected from any loss, injury, damage, claim, lawsuit, cost, expense, attorneys fees, litigation costs, defense costs, court costs or any other cost arising out of or in any way related to the performance of this Agreement. Accordingly, the provisions of this indemnity provision are intended by the parties to be interpreted and construed to provide the fullest protection possible under the law to the Agency.
CONTRACTOR acknowledges that AGENCY would not have entered into this Agreement in the absence of the commitment of CONTRACTOR to indemnify and protect AGENCY as set forth here. 5-4.2.2 To the full extent permitted by law, CONTRACTOR shall defend, indemnify and hold harmless AGENCY, its employees, agents and officials, from any liability, claims, suits, actions, arbitration proceedings, administrative proceedings, regulatory proceedings, losses, expenses or costs of any kind, whether actual, alleged, or threatened, actual attorneys fees incurred by AGENCY, court costs, interest, defense costs including expert witness fees and any other costs or expenses of any kind whatsoever without restriction or limitation incurred in relation to, as a consequence of, arising out of or in any way attributable actually, allegedly or impliedly, in whole or in part to the performance of this Agreement. All obligations under this provision are to be paid by CONTRACTOR as they are incurred by the AGENCY. 5-4.2.3 Without affecting the rights of AGENCY under any provision of this agreement or this section, CONTRACTOR shall not be required to indemnify and hold harmless AGENCY as set forth above for liability attributable to the sole fault of AGENCY, provided such sole fault is determined by agreement between the parties or the findings of a court of competent jurisdiction.
This exception will apply only in instances where the AGENCY is shown to have been solely at fault and not in instances where CONTRACTOR is solely or partially at fault or in instances where AGENCY’s fault accounts for only a percentage of the liability involved. In those instances, the obligation of CONTRACTOR will be all-inclusive and AGENCY will be indemnified for all liability incurred, even though a percentage of the liability is attributable to the conduct of the AGENCY. 5-4.2.4 CONTRACTOR acknowledges that its obligation pursuant to this section extends to liability attributable to AGENCY, if that liability is less than the sole fault of AGENCY. CONTRACTOR has no obligation under this Agreement for liability proven in a court of competent jurisdiction or by written agreement between the parties to be the sole fault of AGENCY.
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STANDARD SPECIFICATIONS
5-4.2.5 The obligations of CONTRACTOR under this or any other provision of this Agreement will not be limited by the provisions of any workers compensation act or similar act. CONTRACTOR expressly waives its statutory immunity under such statutes or laws as to AGENCY, its employees, agents and officials. 5-4.2.6 CONTRACTOR agrees to obtain executed indemnity agreements with provisions identical to those as set forth here in this section from each and every subcontractor, sub-tier contractor or any other person or entity involved by, for, with or on behalf of CONTRACTOR in the performance or subject matter of this Agreement. In the event CONTRACTOR fails to obtain such indemnity obligations from others as required here, CONTRACTOR agrees to be fully responsible according to the terms of this section. 5-4.2.7 Failure of AGENCY to monitor compliance with these requirements imposes no additional obligations on AGENCY and will in no way act as a waiver of any rights hereunder. This obligation to indemnify and defend AGENCY as set forth herein is binding on the successors, assigns or heirs of CONTRACTOR and shall survive the termination of this Agreement or this section. 5-4.2.8 CONTRACTOR agrees to provide insurance in accordance with the requirements as set forth here.
If CONTRACTOR uses existing coverage to comply with these requirements and that coverage does not meet the requirements set forth herein, CONTRACTOR agrees to amend, supplement or endorse the existing coverage to do so. The following coverages will be provided by CONTRACTOR and maintained on behalf of AGENCY and in accordance with the requirements set forth herein. 5-4.2.9 Commercial General Liability/Umbrella Insurance. Primary insurance shall be provided on ISOCGL form No. CG 00 01 11 85 or 88. Total limits shall be not less than two million dollars ($2,000,000.00) per occurrence for all coverages and two million dollars ($2,000,000.00) general aggregate. AGENCY and its officers, agents and employees shall be named as additional insureds using ISO additional insureds endorsement form CG 20 10 11 85 (in no event will AGENCY accept an endorsement form with an edition date later than 1990). Coverage shall apply on a primary non- contributing basis in relation to any other insurance or self-insurance, primary or excess, available to AGENCY or any employee or agent of AGENCY. Coverage shall not be limited to the vicarious liability or supervisory role of any additional insured. Umbrella Liability Insurance (over primary) shall apply to bodily injury/property damage, personal injury/advertising injury, at a minimum, and shall include a “drop down” provision providing primary coverage above a maximum of $25,000.00 self-insured retention for liability not covered by primary policies but covered by the umbrella policy. Coverage shall be following form to any underlying coverage.
Coverage shall be provided on a “pay on behalf” basis, with defense costs payable in addition to policy limits. There shall be no cross-liability exclusion. Policies shall have concurrent starting and ending dates.
Each policy of insurance shall contain a clause prohibiting cancellation, modification or lapse without thirty (30) days prior written notice having been given to the City. All insurance policies shall be subject to approval by the City Attorney and certificates evidencing such policies shall be provided to the City concurrently with the filing of all required bonds.
5.4.2.10 Business Auto/Umbrella Liability Insurance. Primary coverage shall be written on ISO Business Auto Coverage form CA 00 01 06 92 including symbol 1 (Any Auto). Limits shall be no less than two million dollars ($2,000,000.00) per accident. Starting and ending dates shall be concurrent. If CONTRACTOR owns no autos, a non-owned auto endorsement to the General Liability policy drafted above is acceptable.
5-4.3 WORKERS’ COMPENSATION INSURANCE
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STANDARD SPECIFICATIONS
5-4.3.1 Workers’ Compensation/Employers’ Liability shall be written on a policy form providing workers’ compensation statutory benefits as required by law. Employers’ liability limits shall be no less than one million dollars per accident or disease. Employers’ liability coverage shall be scheduled under any umbrella policy described above. Unless otherwise agreed, this policy shall be endorsed to waive any right of subrogation as respects the AGENCY, its officers, agents or employees. 5-4.3.2 CONTRACTOR and AGENCY further agree as follows:
5-4.3.2.1 This Section supersedes all other sections and provisions of this Agreement to the extent that any other section or provision conflicts with or impairs the provisions of this Section. 5-4.3.2.2 Nothing contained in this Section is to be construed as affecting or altering the legal status of the parties to this Agreement. The insurance requirements set forth in this Section are intended to be separate and distinct from any other provision in this Agreement and shall be interpreted as such. 5-4.3.2.3 All insurance coverage and limits provided pursuant to this Agreement shall apply to the full extent of the policies involved, available, or applicable. Nothing contained in this Agreement or any other agreement relating to the AGENCY or its operations limits the application of each insurance coverage. 5-4.3.2.4 Requirements of specific coverage features or limits contained in this Section are not intended as a limitation on coverage, limits or other requirements, or a waiver of any coverage normally provided by any insurance. Specific reference to a given coverage feature is for purposes of clarification only and is not intended by any party to be all-inclusive, or to the exclusion of other coverage, or a waiver of any type. 5-4.3.2.5 For purposes of insurance coverage only, this Agreement shall be deemed to have been executed immediately upon any party hereto taking any steps that can be deemed to be in furtherance of or towards performance of this Agreement.
5-4.3.2.6 All general or auto liability insurance coverage provided pursuant to this Agreement, or any other agreements pertaining to the performance of this Agreement, shall not prohibit CONTRACTOR, and CONTRACTOR’s agents, officers or employees from waiving the right of subrogation prior to a loss.
Contractor hereby waives all rights of subrogation against AGENCY. 5-4.3.2.7 Unless otherwise approved by AGENCY, CONTRACTOR’s insurance shall be written by insurers authorized to do business in the State of California and with a minimum “Best’s” Insurance Guide rating of “A+VIII.” Self-insurance will not be considered to comply with these insurance specifications. 5-4.3.2.8 In the event any policy of insurance required by this Agreement does not comply with these requirements or is canceled and not replaced, AGENCY has the right but not the duty to obtain the insurance it deems necessary and any premium paid by AGENCY will be promptly reimbursed by CONTRACTOR.
Upon CONTRACTOR’s failure to make such reimbursement within 30 days of written demand, AGENCY may deduct that sum from any monies due CONTRACTOR hereunder or otherwise. 5-4.3.2.9 CONTRACTOR agrees to provide evidence of the insurance required herein, satisfactory to AGENCY, consisting of certificate(s) of insurance evidencing all of the coverages required and an additional insured endorsement to CONTRACTOR’s general liability and umbrella liability policy (if any) using ISO form CG 20 10 11 85. Certificate(s) are to reflect that the insurer will provide 30 days’ notice of any cancellation of coverage. CONTRACTOR agrees to require its insurer to modify such
SECTION E – Page 14
STANDARD SPECIFICATIONS
certificates to delete any exculpatory wording stating that failure of insurer to mail written notice of cancellation imposes no obligation, and to delete the word “endeavor” with regard to any notice provisions.
CONTRACTOR agrees to provide complete copies of policies to AGENCY upon request. 5-4.3.2.10 CONTRACTOR shall provide proof that policies of insurance required herein expiring during the term of this Agreement have been renewed or replaced with other policies providing at least the same coverage. Such proof shall be furnished within 72 hours of the expiration of the coverages. 5-4.3.2.11 Any actual or alleged failure on the part of AGENCY or any other additional insured under these requirements to obtain proof of insurance required under this Agreement in no way waives any right or remedy of AGENCY or any additional insured, in this or any other regard. 5-4.3.2.12 CONTRACTOR agrees to require all subcontractors or other parties hired for this project to provide general liability insurance naming as additional insureds all parties to this Agreement.
CONTRACTOR agrees to obtain certificates evidencing such coverage and make reasonable efforts to ensure that such coverage is provided as required here. CONTRACTOR agrees to require that no contract used by any subcontractor, or contracts CONTRACTOR enters into on behalf of AGENCY, will reserve the right to charge back to AGENCY the cost of insurance required by this Agreement. CONTRACTOR agrees that upon request, all agreements with subcontractors or others with whom CONTRACTOR contracts on behalf of AGENCY will be submitted to AGENCY for review. Failure of AGENCY to request copies of such agreement will not impose any liability on AGENCY, its officers, agents, or employees. 5-4.3.2.13 If CONTRACTOR is a Limited Liability Company, general liability coverage must be amended so that the Limited Liability Company and its Managers, Affiliates, employees, agents and other persons necessary or incidental to its operations are insureds. 5-4.3.2.14 CONTRACTOR agrees to provide immediate notice to AGENCY of any claim or loss against CONTRACTOR that includes AGENCY as a defendant. AGENCY assumes no obligation or liability by such notice, but has the right (but not the duty) to monitor the handling of any such claim or claims. 5-7 SAFETY
At the pre-construction meeting, the Contractor shall submit his/her complete construction schedule to the Engineer for approval. The Contractor shall submit requests for changes in the schedule to the Engineer for approval at least forty eight (48) hours prior to the scheduled Work. 5-8 PROJECT INFORMATION SIGN
No project information sign is needed for this Project.
SECTION E – Page 15
STANDARD SPECIFICATIONS
SECTION 6 – PROSECUTION AND PROGRESS OF THE WORK
6-1 CONSTRUCTION SCHEDULE AND COMMENCEMENT OF THE WORK
Prior to issuing the Notice to Proceed, the Engineer will schedule and conduct a pre-construction meeting with the Contractor to review the proposed construction schedule and delivery dates, arrange utility coordination, discuss construction methods, and clarify inspection procedures. 6-2 PROSECUTIONOFTHEWORK
Should the Contractor fail to take the necessary steps to fully accomplish said purposes, after orders of the Engineer to do so, the Agency may suspend the work in whole or in part, until the Contractor takes said steps at no cost to the Agency.
The Contractor shall submit monthly progress reports to the Engineer by the tenth day of each month. The report shall include an updated construction schedule. Any deviations from the original schedule shall be explained. Progress payments will be withheld pending receipt of any outstanding reports. 6-3 TIMEOFCOMPLETION
6-3.3 WORKING DAY
The Contractor’s activities shall be confined to the hours between 7:30 a.m. and 4:00 p.m. Monday through Friday. In addition, the Contractor shall not perform any Work on Saturday, Sunday, or on Agencydesignated holidays. Agency-designated holidays are listed in TABLE 1 – AGENCY- DESIGNATED HOLIDAYS below. Deviation from these hours will be permitted upon approval of the Engineer, except in emergencies involving immediate hazard to persons or property.
Deviations from these hours will not be permitted without the prior consent of the Engineer, except in emergencies involving immediate hazard to persons or property. In the event of either a requested or emergency deviation, inspection service fees will be charged against the Contractor. Service fees will be calculated at overtime rates including benefits, overhead, and travel time; and will be deducted from the amounts due the Contractor.
Failure of the Contractor to adhere to working day requirements will result in damages being sustained by the City. Such damages are, and will continue to be, impracticable and extremely difficult to determine. For each OCCURRENCE of a working day or hours violation, as provided herein, the Contractor shall pay to the Agency, or have withheld from monies due to it, the sum of $1,000.00.
TABLE 1 – AGENCY-DESIGNATED HOLIDAYS
New Year’s Day
Martin Luther King, Jr. Day
President’s Day
Memorial Day
Independence Day
Labor Day
Veteran’s Day
Thanksgiving Day
Day after Thanksgiving
Christmas Eve
Christmas Day
SECTION E – Page 16
STANDARD SPECIFICATIONS
EXECUTION OF THE CONTRACT SHALL CONSTITUTE AGREEMENT BY THE AGENCY AND CONTRACTOR THAT $1,000 PER VIOLATION IS THE MINIMUM VALUE OF THE COST AND
ACTUAL DAMAGED CAUSED BY FAILURE OF THE CONTRACTOR TO LIMIT
PERFORMANCE OF THE WORK BETWEEN THE ALLOTTED TIMES, THAT SUCH SUM SHALL
NOT BE CONSTRUED AS A PENALTY, AND THAT SUCH SUM MAY BE DEDUCTED FROM PAYMENTS DUE THE CONTRACTOR IF SUCH DELAY OCCURS.
6-4 DELAYS AND EXTENSION OFTIME
6-4.1 GENERAL
6-4.1.1 Notice of Delays
Whenever the Contractor foresees any delay in the prosecution of the work, and in any event immediately upon the occurrence of any delay which the Contractor regards as unavoidable, he/she shall notify the Engineer in writing of the probability of the occurrence of such delay and its cause so that the Engineer may take immediate steps to prevent, if possible, the occurrence or continuance of the delay, or, if prevention is not possible, may determine whether the delay is to be considered avoidable or unavoidable, how long it continues, and to what extent it will delay the prosecution and completion of the work. It will be concluded that any and all delays which have occurred in the prosecution and completion of the work have been avoidable delays, except such delays as shall have been called to the attention of the Engineer at the time of their occurrence and found by him/her to have been unavoidable. The Contractor shall make no claims for any delay not called to the attention of the Engineer at the time of its occurrence as an unavoidable delay.
6-4.1.2 Avoidable Delays
Avoidable delays in the prosecution or completion of the work shall include all delays which in the opinion of the Engineer would have been avoided by the exercise of care, prudence, foresight, and diligence on the part of the Contractor of his/her subcontractors. The following shall be considered avoidable delays within the meaning of the contract: 1) Delays in the prosecution of parts of the work which may in themselves be unavoidable but do not necessarily prevent or delay the prosecution of other parts of the work or the completion of the whole work within the time herein specified; 2) Reasonable loss of time resulting from the necessity of submitting samples of materials and drawings to the Engineer for approval and from performing tests of materials, measurements, and inspections; 3) Reasonable interference of other contractors employed by the Agency and/or other contractors working in the area which do not necessarily prevent the completion of the whole work within the time agreed upon; 4) Delays resulting from inaccurate or incomplete shop drawing submittals; and 5) Interference of other contractors performing concurrent work.
6-4.1.3 EXTENSION OF TIME
In case the work is not completed in the time specified, including such extensions of time as may have been granted for unavoidable delays, the Contractor will be assessed damages for delay in accordance with Paragraph 6-9. The Agency, however, shall have the right to grant an extension of time for avoidable delay if it is deemed in his/her best interest to do so. During such extension of time, the Contractor will be charged for engineering and inspection services and other costs as provided in Paragraph 6-4.2.1 but will not be assessed damages pursuant to Paragraph 6-9.
6-4.2 EXTENSIONS OF TIME
6-4.2.1 COMPENSATION TO AGENCY FOR EXTENSION OF TIME
SECTION E – Page 17
STANDARD SPECIFICATIONS
Compensation for extension of time for avoidable delay granted pursuant to Paragraph 6-4.1.3 shall be the actual cost to the Agency for engineering, inspection, general supervision, and overhead expenses which are directly chargeable to the work and which accrue during the period of such extension, except that the cost of final inspection and preparation of the final estimate shall not be included. 6-4.4 WRITTEN NOTICE AND REPORT
Requests for an extension of time must be delivered to the Agency within ten (10) consecutive calendar days following the date of the occurrence that caused the delay. The request must be submitted in writing and must state the cause of the delay, the date of the occurrence causing the delay, and the amount of additional time requested. This shall be included as part of a revised construction schedule required in Section 6-1. Requests for extensions of time shall be supported by all evidence reasonably available or known to the Contractor, which would support the extension of time requested. Requests for extensions of time, which are not received within the time specified above, shall result in the forfeiture of the Contractor’s right to receive any extension of time requested.
If the Contractor is requesting an extension of time because of weather, he/she shall supply daily written reports to the Agency’s representative describing such weather, and the work that could not be performed that day because of such weather or conditions resulting therefrom and that he/she otherwise would have performed.
6-9 LIQUIDATED DAMAGES
6-9 FORFEITURE DUE TO DELAY
The Contractor shall complete all or any designated portion of the Work called for under the Contract within the time set forth in Part C (Proposal) of these Specifications.
In accordance with Government Code 53069.85, and all other applicable law, the Contractor agrees to forfeit and pay the Agency the amount of Five Hundred Dollars ($500.00) per day for each and every day of unauthorized delay beyond the completion date, which shall be deducted from any monies due the Contractor. This payment shall be considered liquidated damages. Contractor agrees that such liquidated damages are reasonable under the circumstances existing at the time of execution of the contract, that such liquidated damages are to compensate Agency for losses that are difficult to measure and that such damages are not a penalty.
Failure of the Contractor to perform any covenant or condition contained in the Contract Documents within the time period specified shall constitute a material breach of this Contract entitling the Agency to terminate the Contract unless the Contractor applies for, and receives, an extension of time in accordance with the procedures set forth in Section 6-4.
Failure of the Agency to insist upon the performance of any covenant or conditions within the time period specified in the Contract Documents shall not constitute a waiver of the Contractor’s duty to complete performance within the designated periods unless the Agency has executed a waiver in writing.
The Agency’s agreement to waive a specific time provision or to extend the time for performance shall not constitute a waiver of any other time provision contained in the Contract Documents.
SECTION E – Page 18
STANDARD SPECIFICATIONS
Failure of the Contractor to complete performance promptly within the additional time authorized in a waiver or extension of time agreement shall constitute a material breach of this Contract entitling the Agency to terminate this agreement.
The Contractor shall not be deemed in breach of this Contract and no forfeiture due to delay shall be made because of any delays in the completion of the Work due to unforeseeable causes beyond the control and without the fault or negligence of the Contractor provided the Contractor requests an extension of time in accordance with the procedures set forth in Section 6-4. Unforeseeable causes of delay beyond the control of the Contractor shall include acts of God, acts of a public enemy, acts of the government, acts of the Agency, or acts of another contractor in the performance of a contract with the Agency, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and weather, or delays of subcontractors due to such causes, or delays caused by failure of the owner of a utility to provide for removal or relocation of existing utility facilities. Delays caused by actions or neglect of Contractor or his/her agents, servants, employees, officers, subcontractors, directors, or of any party contracting to perform part of all of the Work or to supply any equipment or materials shall not be excusable delays. Excusable delays (those beyond the Contractor’s control) shall not entitle the Contractor to any additional compensation. The sole recourse of the Contractor shall be to seek an extension of time.
6-10 DISPUTES ANDCLAIMS
6-10.1 GENERAL
Any and all decisions made on appeal pursuant to this Subsection 6-10 shall be in writing. Any “decision” purportedly made pursuant to this Subsection 6-10 that is not in writing shall not be binding upon the Agency and should not be relied upon by the Contractor.
Nothing in this subsection shall be considered as relieving the Contractor from his/her duty to file the notice required under Subsection 6-11 or other duties required by the Contract Documents. 6-10.2 ADMINISTRATIVE REVIEW
Request for review made to the Construction Inspector or Project Engineer may be either oral or written.
Request for review made to the City Engineer shall be made in writing with supporting evidence attached.
The Contractor shall submit each request for review within twenty-one (21) calendar days of receipt of the decision that he/she is requesting.
Prior to demand for arbitration, the Contractor shall exhaust his/her administrative remedies by attempting to resolve his/her dispute or claim with Agency`s staff in the following sequence:
1. Project Manager
2. City Engineer
Should the Project Manager fail to address the Contractor’s request for review of a disputed decision within fourteen (14) calendar days after receiving such request, the Contractor may proceed directly to the City Engineer. At the option of the Agency, the person to whom the request for review is directed may elect to take such request to a higher level and the Contractor’s request shall be deemed to be properly submitted to such higher level.
SECTION E – Page 20
STANDARD SPECIFICATIONS
The City Engineer shall address disputes or claims within twenty eight (28) calendar days after receiving such request and all necessary supporting data. The City Engineer’s decision on the dispute or claim shall be the Agency’s final decision.
6-10.3 ARBITRATION
Claims and disputes arising under or related to the performance of the contract shall be resolved in arbitration unless the Agency and the Contractor agree in writing, after the claim or dispute has arisen, to waive arbitration and to have the claim or dispute litigated in court of competent jurisdiction. Arbitration shall be conducted, to the extent feasible, pursuant to Chapter 3 (Sections 301-393, inclusive) of Division 2 of Title 1 of the California Code of Regulations except that references therein to the “State Contract Act” shall be construed to mean “applicable law” and “Public Agency”, or “Department” shall be construed to mean “Agency” as defined in Subsection 1.2. The arbitration decision shall be decided under and in accordance with California law, supported by substantial evidence, and in writing, contain the basis for the decision, findings of fact, and conclusions of law.
Arbitration shall be initiated by a Demand for Arbitration. The Contractor shall request a Demand for Arbitration not later than one hundred eighty (180) calendar days after the date of the final written decision of the Agency on the claim or dispute.
All contracts valued at more than $15,000 between the Contractor and his/her Subcontractors and Suppliers shall include a provision that the Subcontractors and Suppliers shall be bound to the Contractor to the same extent that the Contractor is bound to the Agency by all terms and provisions of the Contract, including these arbitration provisions.
6-11 NOTICEOFPOTENTIALCLAIM
The Contractor shall not be entitled to the payment of any additional compensation for any cause, including any act, or failure to act, by the Engineer, or the happening of any event, thing or occurrence, unless the Contractor shall have given the Engineer due notice in writing, of the potential claim as hereinafter specified, provided, however, that compliance with this Subsection 6-11 shall not be a prerequisite as to any claim that is based on differences in measurements or errors of computation as to the Contract quantities.
Additionally, this Subsection 6-11 shall not supersede the specific notice and protest requirements of Subsection 2-9 “Changed Conditions” and Subsection 6-3.2 “Contract Time Accounting” respectively.
A written notice of potential claim shall set forth the reasons the Contractor believes additional compensation will or may be due, the nature of the costs involved, and, insofar as possible, the amount of the potential claim. A notice as above required must have been given to the Engineer prior to the time that the Contractor shall have performed the Work giving rise to the potential claim for additional compensation, if based on an act or failure to act by the Engineer, or in all other cases within fifteen (15) days after the happening of the event, thing or occurrence giving rise to the potential claim.
It is the intention of this Subsection 6-11 that differences between the parties arising under and by the virtue of the Contract be brought to the attention of the Engineer at the earliest possible time in order that such matters may be settled, if possible, or other appropriate action promptly taken. The Contractor hereby agrees that he/she shall have no right to additional compensation for any claim that may be based on any such act, failure to act, event, thing or occurrence for which no written notice of potential claim as herein required was filed.
SECTION E – Page 21
STANDARD SPECIFICATIONS
SECTION 7 – MEASUREMENT AND PAYMENT
7-3 PAYMENT
7-3.2 PARTIAL AND FINAL PAYMENT
The closure date for period progress payments will be the twenty-fifth day of each month. Authorization to pay is commonly received on the second Wednesday of the following month. The Agency requires four to six weeks to review all progress payments, issue payment checks, present progress payment to Council for approval, and release payment to contractor. However, payments will be withheld pending receipt of any outstanding reports required by the Contract Documents. In addition, the final progress payment will not be released until the Contractor returns the control set of plans and specifications showing the as-built conditions.
The full five (5) percent retention will be deducted from all payments. The final retention will be authorized for payment thirty five (35) days after the date of recordation of the Notice of Completion.
The Contractor may substitute securities for any monies withheld by the Agency to ensure performance under the Contract as provided in Public Contract Code Sections 10263 and 22300. 7-3.3 DELIVERED MATERIALS
Materials and equipment delivered but not incorporated into the Work will not be included in the estimate for progress payment.
7-3.4 Mobilization
Mobilization and demobilization shall consist of preparatory work and operations including, but not limited to, those necessary for the movement of personnel, equipment, materials, and incidentals to the project site necessary for work on the project and for all other work and operations which must be performed or costs incurred including bonds, insurance, and financing prior to beginning work on the various contract items on the project site. Mobilization shall also include the time, materials, and labor to move the necessary construction equipment to and from the site, supervisory time on the job by the Contractor’s personnel to keep the construction site in a safe condition, and all other related work as required at all times and for all non-working days during the construction period. The Contractor is responsible for securing an adequate storage site for equipment and materials.
Contractor shall provide traffic control per California Temporary Traffic Control Handbook. Contractor must maintain access for visitors to the properties. One driveway must always remain open and accessible.
The cost for traffic control shall be paid per a separate lump sum bid item.
Payment for Mobilization shall be included in the other items of work and shall be considered full compensation and include but not be limited to, obtaining all business licenses and permits, as required for the entire project, from all related agencies, including, but not limited to, utility
SECTION E – Page 22
STANDARD SPECIFICATIONS
companies, private and public agencies and the City of Los Alamitos; and complying with the requirements specified in those licenses and permits; coordination, field office facility, implementation of Best Management Practices, and incidentals necessary to perform all related items of work.
SECTION F – Page 23
SPECIAL PROVISIONS
ON-CALL SERVICES FOR CONCRETE REMEDIATION
CIP NO. 22/23-08
TECHNICAL PROVISIONS
PART 3 - CONSTRUCTION METHODS
SECTION 300 – EARTHWORK
300-1 CLEARING AND GRUBBING
300-1.1 General.
In addition to the work outlined in Subsection 300-1 of the Standard Specifications, the following items of work are included in other bid items and no additional payment will be made therefore.
(1) Protection of utilities, trees, fences, walls and other facilities within the construction zone, except those specifically directed by the Engineer to be removed or relocated.
(2) Clearing and removal of debris from site of work.
(3) Delay in work necessary to accommodate utility relocations by others. (4) Other items of work as directed in these specifications. 300-1.3 Removal and Disposal of Material.
300-1.2 Root Pruning and Tree Trimming.
300-1.2.1 Protection of Existing Trees to Remain.
All trees to remain in place within the limits of work shall be protected from damage by workmen, equipment, and operations. Insofar as prosecution of the work allows, following removal of surrounding pavements, etc., the root area beneath the tree drip line shall be protected from damage, including compaction. Protection shall include temporary fencing, barricades, etc.
Warning tape will not be considered sufficient.
300-2 UNCLASSIFIED EXCAVATION
It is Contractor’s responsibility to protect all existing adjacent features such as landscaping, irrigation system, property’s fence/wall/gates, curb and gutter, pull boxes, utility boxes, and etc. in place per Section 400. All damages to these items shall be fixed to the satisfaction of City Engineer without any additional compensation.
SECTION F – Page 24
SPECIAL PROVISIONS
PART 4 – EXISTING IMPROVEMENTS
SECTION 400 - PROTECTION AND RESTORATION
400-1 GENERAL
Replace the second paragraph with the following:
The Contractor shall relocate, repair, replace or reestablish all existing improvements within the project limits (e.g., curbs, sidewalks, driveways, fences, walls, sprinkler systems, signs, utility installations, pavements, structures, survey monuments, landscaping, etc.) that are damaged or removed as a result of the Contractor’s operations or as required by the plans and specifications.
All existing improvements, either within the right-of-way or not, including irrigation lines that are damaged by actions of the Contractor, shall be restored by the Contractor to their original or better condition at the Contractor’s expense.
The Contractor shall mark, as approved by the Engineer, all survey monuments, manholes, valves, substructures, or other items that are visible on the surface and will be covered by his operations.
This shall be completed prior to the start of that operation and approved by the Engineer.
Existing traffic striping, pavement markings, and curb markings shall also be considered as existing improvements and the Contractor shall repaint or replace, at the Contractor’s expense, such striping or markings (except for traffic striping and pavement markings within the limits of the Work) if damaged or if their reflectivity is reduced due to construction operations. 400-3 PAYMENT
Replace the last sentence of the first paragraph with the following:
All costs to the Contractor for protecting, removing, restoring, relocating, repairing, replacing, or reestablishing existing improvements shall be included in the Bid.
SECTION 402 - UTILITIES
Add the following Subsections:
402-1.1.1 MANDATORY NOTIFICATION PRIOR TO EXCAVATION
The Contractor’s attention is direct to Section 4215.5 through 4217 of the Government Code of the State of California. This requires that two (2) working days prior to commencing any excavation “Underground Service Alert of Southern California” (USA) shall be notified by phone, toll free 1- 800-227-2600, for the assignment of an Inquiry Identification Number.
Construction Contractor shall contact all utility companies (e.g. gas company, electric company, telephone company, cable company, water company, and refuse collectors) at least five (5) working days prior to commencing work and shall verify the location of any known utilities and determine whether or not a representative of each company will be present during excavation:
Additionally, the Contractor shall also notify local entities of his/her schedule fourteen (14) days prior to commencing work, including, local law enforcement agencies, the Post Office, Public Schools, and Bus Companies.
No excavation shall commence unless the Contractor has obtained the USA Inquiry
SECTION F – Page 25
SPECIAL PROVISIONS
Identification Number.
402-1.1.2 ACCURACY OF UTILITIES INFORMATION
The locations of known existing major utilities, whether above ground or underground, are indicated on the plans. Information and data reflected in the Contract Documents with respect to underground and above ground utilities at or contiguous to the site is based upon information and data furnished to the City and the Engineer by the owners of such utilities, and the City does not assume responsibility for the accuracy or completeness thereof. The Contractor shall take all possible precautions for the protection of unforeseen utility lines to provide for uninterrupted service and to provide such special protection as may be necessary.
The Contractor shall be responsible for determining the location and depth of all underground facilities, including service connections, which may affect or be affected by his/her operations and he/she shall include the cost to pothole all utilities within the limits of work in his/her bid. If an existing utility line, which has been marked by Underground Service Alert or is shown on the plans, is damaged by the Contractor, the Contractor shall repair the line and bear the cost thereof.
Contractor shall be aware that electrical conduits between street and traffic lights may exist beneath pavement and/or sidewalk in areas where such lights are in place and that said conduits are not shown on these plans.
In the event that the Contractor damages any existing utility lines that are not shown, shown incorrectly or the locations of which are not made known to the Contractor prior to excavation, a telephone call and written report shall be made immediately to the Utility owner, the Engineer, and to the City. If directed by the City, the Contractor shall make repairs under the provisions for changes and extra work contained in SECTION 3 – CONTROL OF THE WORK of the SSPWC Standard Specification.
SECTION 404 - COLD MILLING
404-12 Payment
Measurement and Payment for Trip Hazard Removal (1/4” to 2”) shall be paid per Inch Foot (in-ft) and shall include full compensation for labor, materials, equipment, mobilization, traffic control, grinding /shaving of sidewalk, meeting OSHA requirements, and any other incidentals required for removing trip hazards and no additional compensation shall be made therefor.
SECTION F – Page 26
SPECIAL PROVISIONS
SECTION F – Page 27
SPECIAL PROVISIONS
PART 6 – TEMPORARY TRAFFIC CONTROL
600 ACCESS
600-1 General
Add the following:
600-1.1 Parking Restrictions and Posting for Tow Away
No Parking signs, posted by the Contractor, shall be of heavy card stock and not less than 1.75 square feet of surface area on the face. Background color shall be white and letters shall be printed in red water resistant ink except day, date, and time of restriction may be printed in black water resistant ink. The signs shall be printed with the words “Tow Away” and “No Parking” with a character height of not less than 2.75 inches and a stroke width of not less than
0.5 inches. The day, dated, and time of the particular restriction shall be printed or attached below the above mentioned wording in characters of not less than 2.0 inches in height and 0.4 inches in stroke width. The day of the week shall be written out or properly abbreviated with three to four letters; date or dates or restriction shall be listed completely; the beginning and ending times shall be clearly listed on the sign.
Signs shall be mounted such that the wording “No Parking” are at an elevation at least three feet above the adjacent flowline. Signs may be tied with string to trees and power poles, taped to existing sign poles, or mounted to stakes or barricades as provided by the Contractor. The signs shall be placed as needed to control the parking of cars within the construction zone; signs shall be placed at intervals of 75 feet or less along each side of the roadway.
Signs shall be posted and maintained by the Contractor for a period of 72 hours prior to the restrictions becoming effective. The Contractor may only post parking restrictions that are effective for the duration of the Work. Upon completion of the Work, the Contractor shall promptly and completely remove and dispose all signs, stakes, and barricades. The Contractor shall promptly reset or replace all damaged or defective signs.
The Contractor shall be fully responsible for the adequate removal of all parked cars. The Contractor shall coordinate the removal of all vehicles with the Sheriff Department. The
SECTION F – Page 28
SPECIAL PROVISIONS
Contractor shall notify the Sheriff Communications Center upon posting of the parking restrictions for a particular street. For removal of parked vehicles, the Contractor shall notify the Sheriff Communications Center not less than two hours prior to the needed removal, stating the address nearest the parked vehicle, make, model, color and license number. The City shall not be responsible for any delay or additional costs associated with the removal of parked cars that obstruct the construction operation.
If a vehicle owner successfully contests a towing citation in court, and their citation is dismissed for causes related to the Contractor’s failure to perform the requirements of this section, the Contractor shall reimburse the City for the cost of any claims associated with the towing citation.
DEVIATIONS FROM THE REQUIREMENTS OF THIS SUBSECTION WILL BE PERMITTED ONLY ON PRIOR CONSENT OF THE ENGINEER. FAILURE OF THE
CONTRACTOR TO ADHERE TO THE REQUIREMENTS OF THIS SUBSECTION, OR
FAILURE OF THE CONTRACTOR TO COMPLETE HIS DAILY SCHEDULE ONCE “TEMPORARY NO PARKING” SIGNS HAVE BEEN POSTED, WILL RESULT IN DAMAGES BEING SUSTAINED BY THE CITY. SUCH DAMAGES ARE, AND WILL CONTINUE TO BE, IMPRACTICABLE AND EXTREMELY DIFFICULT TO DETERMINE.
FOR EACH OCCURRENCE OF A VIOLATION, AS PROVIDED HEREIN, THE
CONTRACTOR SHALL PAY TO THE AGENCY, OR HAVE WITHHELD FROM MONIES DUE TO IT, THE SUM OF $1,000.00.
EXECUTION OF THE CONTRACT SHALL CONSTITUTE AGREEMENT BY THE AGENCY AND CONTRACTOR THAT $1,000.00 PER VIOLATION IS THE MINIMUM
VALUE OF THE COST AND ACTUAL DAMAGE CAUSED, THAT SUCH SUM SHALL
NOT BE CONSTRUED AS A PENALTY, AND THAT SUCH SUM MAY BE DEDUCTED FROM PAYMENTS DUE THE CONTRACTOR.
600-1.2 STREET CLOSURE, DETOURS, BARRICADES
Add the following:
All traffic control barricades, signs and devices used by the Contractor shall, as a minimum, conform to the “Manual of Traffic Controls for Construction and Maintenance Work Zones,” adopted by and in current use by the State of California, Department of Transportation.
Channelization devices shall be spaced no greater than fifty (50) feet apart. The Contractor shall take additional precautions as he/she may find necessary under the circumstances.
Should the Contractor fail to provide adequate traffic control or safety barricades, and in the event a responsible individual cannot be located or refuses to perform, the Agency will at its option place needed devices or engage a private firm to place and maintain said barricades, which will be charged to the Contractor directly.
Temporary traffic channelization shall be accomplished with delineators. Temporary striping will not be allowed unless specifically permitted by the Engineer. The Contractor shall prepare any plans that may be required for temporary striping to the satisfaction of the Engineer. In no event will temporary striping be allowed on finished pavement surfaces which are to remain.
Full street closures will not be allowed prior to City Council approval. 601-1.3 Measurement and Payment.
Measurement and Payment for Traffic Control shall be at the lump sum (LS) bid price and shall
SECTION F – Page 50
SPECIAL PROVISIONS
include but not limited to furnishing all labor, tools, material, equipment, signage, TTC zone devices, channelizing devices, changeable message sign, and incidentals for doing all work involved in preparing traffic control plans and implementing traffic control, and no additional compensation will be allowed therefore.
APPENDIX – PART 1
STANDARD PLANS
APPENDIX – PART 1
STANDARD PLANS
APPENDIX – PART 1
Standard Plans
None
City of Los Alamitos
CITY COUNCIL AGENDA REPORT
MEETING DATE: June 20, 2023 ITEM NUMBER: 10L
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: Annual Comprehensive Financial Report (ACFR)
SUMMARY
For City Council consideration is the receipt of the fiscal year 2021-22 audit reports.
RECOMMENDATION
Receive and file the annual audit reports for fiscal year 2021-22, including the Annual Comprehensive Financial Report (ACFR) and Report on Applying GANN Agreed-Upon Procedures (GANN AUP) Appropriation Limit Worksheets.
BACKGROUND
Each year an independent audit of the City is conducted in conformity with Generally Accepted Auditing Standards (GAAS). Those standards require that an independent Certified Public Accountant plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The auditor also expresses an opinion on the fairness of the presentation of the financial position and the results of operations of the government's basic financial statements in conformity with Generally Accepted Accounting Principles (GAAP).
DISCUSSION
This item was pulled from an earlier Council Meeting because errors had been detected. One of the errors was in the narrative section of the report in table 2 on page 8 that had a typographical error and resulted in an overstatement of one of the numbers.
The other error was in connection with a reference used on page 20, where a different municipal jurisdiction other than Los Alamitos had been noted. The errors did not have any impact on the financial statements.
Finance consulted with another auditing firm, Rogers, Anderson, Malody & Scott, LLP (RAMS) to perform a peer review of the original report prepared by the City’s current auditor, Gruber and Lopez. In addition, the ACFR report has been thoroughly reviewed by Finance staff to ensure its accuracy. All of the noted errors have been corrected.
As a result of the problematic nature and the quality of the original report prepared by Gruber and Lopez, the City will be engaging with a new auditing firm for the remaining two years of the audit contract, FY22-23 and FY23-24.
FISCAL IMPACT
None.
Attachment: 1. Annual Comprehensive Fiscal Report 2022
2. GANN Agreed-Upon Procedure Report
Annual Comprehensive Financial Report (ACFR)
FISCAL YEAR ENDED June 30, 2022
City of Los Alamitos
Los Alamitos, California
Annual Comprehensive Financial Report
For the Fiscal Year Ended June 30, 2022
Prepared by the
Finance Department of Los Alamitos
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City of Los Alamitos
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022
Table of Contents
Page
INTRODUCTORY SECTION (UNAUDITED)
Letter of Transmittal .................................................................................................................................................. i Organizational Chart ................................................................................................................................................. v Principal Officials of the City of Los Alamitos ....................................................................................................... vi Certificate of Achievement for Excellence in Financial Reporting – Government Finance Officers Association ....................................................................................................... vii
FINANCIAL SECTION
Independent Auditors’ Report on Financial Statements ............................................................................................ 1 Management’s Discussion and Analysis ....................................................................................................................... 5 Basic Financial Statements:
Government – Wide Financial Statements:
Statement of Net Position .................................................................................................................................. 15 Statement of Activities ...................................................................................................................................... 17 Fund Financial Statements:
Governmental Fund Financial Statements:
Balance Sheet .............................................................................................................................................. 21 Reconciliation of the Governmental Funds Balance Sheet
to the Government–Wide Statement of Net Position ........................................................................... 22 Statement of Revenues, Expenditures,
and Changes in Fund Balances ............................................................................................................. 23 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government–Wide Statement of Activities ......................................................................................................................... 24 Proprietary Fund Financial Statements:
Statement of Net Position ........................................................................................................................... 27 Statement of Revenues, Expenses, and Changes in Net Position ............................................................... 28 Statement of Cash Flows ............................................................................................................................ 29 Notes to the Basic Financial Statements............................................................................................................... 31
City of Los Alamitos
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022
Table of Contents
Page
FINANCIAL SECTION (Continued)
Required Supplementary Information (Unaudited):
Budgetary Comparison Schedule – General Fund .......................................................................................................... 64 Notes to the Budgetary Comparison Schedule ............................................................................................................... 65 Schedule of the City's Proportionate Share of the Net Pension Liability and Related Ratios - Miscellaneous .............. 66 Schedule of the City's Proportionate Share of the Net Pension Liability and Related Ratios - Safety ........................... 67 Schedule of City’s Contributions - Pension .................................................................................................................... 68 Schedule of Changes in Net OPEB Liability and Related Ratios ................................................................................... 69 Supplementary Information:
Nonmajor Governmental Funds:
Combining Balance Sheet ................................................................................................................................. 71 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ......................................... 75 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual Nonmajor Special Revenue Funds:
Community Development Block Grant ................................................................................................ 79 Measure M ............................................................................................................................................ 80 Los Alamitos Television....................................................................................................................... 81 Office of Traffic Safety ........................................................................................................................ 82 Asset Seizure ........................................................................................................................................ 83 Public Safety Augmentation ................................................................................................................. 84 State Law Enforcement Service ........................................................................................................... 85 Air Quality ............................................................................................................................................ 86 State Gas Tax ........................................................................................................................................ 87 Nonmajor Capital Project Funds:
Park Development ................................................................................................................................ 88 Building Improvement ......................................................................................................................... 89 Residential Streets/Alleys ..................................................................................................................... 90 Traffic Improvement Fund ................................................................................................................... 91 Nonmajor Debt Service Fund:
Debt Service ......................................................................................................................................... 92 Internal Service Funds:
Combining Statement of Net Position ............................................................................................................... 93 Combining Statement of Revenues, Expenses, and Changes in Net Position ................................................... 95 Combining Statement of Cash Flows ................................................................................................................ 97
City of Los Alamitos
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022
Table of Contents
Page
STATISTICAL SECTION (Unaudited)
Net Position by Component Last Ten Fiscal Years ..................................................................................................... 101 Changes in Net Position Last Ten Fiscal Years ........................................................................................................... 102 Fund Balances of Governmental Funds Last Ten Fiscal Years .................................................................................... 104 Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years ................................................................. 106 2021/22 Use Category Summary-Basic Property Value Table Last Ten Fiscal Years ................................................ 108 Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years .......................................... 110 Direct and Overlapping Property Tax Rates Last Ten Fiscal Years ............................................................................. 111 Principal Property Taxpayers Current Year and Ten Years Ago ................................................................................. 113 Property Tax Levies and Collections Last Ten Fiscal Years ........................................................................................ 114 Ratio of Outstanding Debt by Type Last Ten Fiscal Years .......................................................................................... 115 Direct and Overlapping Governmental Activity Debt .................................................................................................. 116 Legal Debt Margin Information ................................................................................................................................... 117 Demographic and Economic Statistics ......................................................................................................................... 118 Full-Time Equivalent City Government Employees by Function/Program Last Ten Fiscal Years ............................. 119 Operating Indicators by Function/Program Last Ten Fiscal Years .............................................................................. 120 Capital Asset Statistics by Function/Program Last Ten Fiscal Years .......................................................................... 122 Top 10 Businesses for Fiscal Yest 2021-22 ................................................................................................................. 123 Principal Employers ..................................................................................................................................................... 124
As we transition to Fiscal Year 2022-23, the annual operating budget is balanced, with operating revenues of $21,348,825 and operating expenditures of $20,367,325, resulting in an estimated surplus of $981,500. General Fund balance reserves are projected to total approximately $16.8 million on July 1, 2022. The City Council reviews its Fund Balance Policy oncethe books have beenclosed for thepriorfiscal year. The most recent Fund Balance Policy established set aside reserves for CalPERS reserves ($3.62 million), and other post-employment benefits (OPES) ($500,000).
Long-Term Financial Planning and Major Initiatives
Following the adoption of the FY2020-21 budget, the City Council and the residents of Los Alamitos took action. After the City Council unanimously voted to place a revenue measure on the ballot, residents voted to enact a 1.5% sales tax that would be dedicated to ensuring essential services and Los Alamitos residents' quality of life. This new revenue source will allow for the city to continue to provide the needed services to the community, while addressing infrastructure deficiencies.
To further solidify the City's commitment to responsible stewardship of this new revenue, the City Council unanimously approved a Fiscal Sustainability Pledge (FSP). The pledge highlighted specific operations and programs the City Council intended to target in the event of passage of Measure Y, and included Public Safety, essential community services, infrastructure, and stimulating local economic growth. The passage of Measure Y, which is estimated to generate approximately $5 million in additional revenue, significantly altering the outcome of the previous projections.
As of June 30, 2022, the City's General Fund had fund balance unassigned and assigned of approximately $16.8 million. Of this amount, $3.4 million is designated for PERS reserves, and $500,000 is designated for retiree medical insurance benefits. Nonspendable fund balance consists primarily of prepaid amounts for the 2022-23 Fiscal Year, which were paid during the 2021-22 Fiscal Year.
Annually, the City updates a seven (7) year Capital Improvement Program (GIP). The Capital Improvement Program for Fiscal Year 2022-23 totals $4,222,269, which includes $215,000 carried forward from Fiscal Year 2021-22. Projects include, but are not limited to, Phase II Street Improvements and Sterns Park funded by Measure Y, and the New Dutch Haven and Bloomfield Street Improvement Projects. The Capital Improvement Program continues to provide a significant amount of funding for streets.
Awards and Acknowledgements
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City for its comprehensive annual financial report (CAFR) for the fiscal year ended June 30, 2021. The City received this award for publishing an easily readable and efficiently organized CAFR that satisfied both GAAP and applicable legal requirements.
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CITY OF LOS ALAMITOS
Organization
City
Commissions &
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Citizens of Los
Alamitos
City Council
Development
Services
City Attorney
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Services
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Employee& Payroll - - - Facility
Technology Development • Retiree Benefits
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De pa rtmenta I - Outreach - CDBG - Fleet """ Recruitment & � =- Onboarding .
Debt Youth Programs Information
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• Communicatio ns
Team
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Advocacy
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CITY OF LOS ALAMITOS
vi
DIRECTORY OF OFFICIALS (as of June 30, 2022)
CITY COUNCIL
Shelley Hasselbrink, Mayor
Tonya Doby, Mayor Pro Tem
Ron Bates, Council Member
Mark A. Chirco, Council Member
Jordan Nefulda, Council Member
APPOINTED OFFICIALS
Chet Simmons, City Manager
Michael S. Daudt, City Attorney
Windmera Quintanar, City Clerk
EXECUTIVE MANAGEMENT
Chris Kelly, City Engineer
Chelsi Wilson, Administrative Services Manager
Craig Koehler, Finance Director
Emeline Noda, Recreation and Community Services Director Ron Noda, Development Services Director
Michael Clayborn, Chief of Police
vii
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1 To the Honorable Mayor and Members of the City Council of the City of Los Alamitos
Los Alamitos, California
Independent Auditors’ Report
Opinions
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Los Alamitos, California, as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City of Los Alamitos, California’s basic financial statements as listed in the table of contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Los Alamitos, California, as of June 30, 2022, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City of Los Alamitos, California, and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Emphasis of Matter
As described in Note 1 to the basic financial statements, the City adopted the provisions of Governmental Accounting Standards Board Statement No. 87, Leases. Our opinion is not modified with respect to this matter.
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City of Los Alamitos, California’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.
Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. 438 Old Newport Blvd – Newport Beach, CA 92663
Phone (949) 346-2900 –www.gruberlopezinc.com
To the Honorable Mayor and Members of the City Council
of the City of Los Alamitos
Los Alamitos, California
2 In performing an audit in accordance with generally accepted auditing standards, we:
Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City of Los Alamitos, California’s internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City of Los Alamitos, California’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, the schedule of proportionate share of the net pension liability and related ratios, schedule of plan contributions – defined benefit pension plan, schedule of changes in the net OPEB liability and related ratios, schedule of plan contributions – OPEB plan, and budgetary comparison information be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Los Alamitos, California’s basic financial statements. The combining and individual nonmajor fund financial statements , budgetary schedules, and financial data schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements, budgetary schedules, and financial data schedules are fairly stated, in all material respects, in relation to the basic financial statements as a whole.
To the Honorable Mayor and Members of the City Council
of the City of Los Alamitos
Los Alamitos, California
3 Other Information
Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.
In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated February 6, 2023, on our consideration of the City of Los Alamitos, California’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City of Los Alamitos, California’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City of Los Alamitos, California’s internal control over financial reporting and compliance.
Newport Beach, California
February 6, 2023
Gruber and Lopez, Inc.
Gruber and Lopez, Inc.
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5 MANAGEMENT'S DISCUSSION AND ANALYSIS
The management of the City of Los Alamitos ("City") offers readers of the City's financial statements this narrative overview and analysis of the City's financial activities for the fiscal year ended June 30, 2022. We encourage readers to consider the information presented here in conjunction with additional information that is provided in our letter of transmittal.
The presentation of the City's financial data in this analysis and statements will differ from the City's budget, in that the analysis and statements are required to follow Governmental Accounting Standards Board Statement Number 34 and other Statements to allocate costs associated with capital related items, long-term debt transactions, accrued interest, compensated absences internal service fund activity, and depreciation to the various functions of the City; whereas the City's budget is an operational financial plan for the upcoming fiscal year.
OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis provides an introduction to the City's basic financial statements. The City's basic financial statements are comprised of three components:
1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements.
Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City's finances, in a manner similar to a private-sector business.
The statement of net position presents information on all of the City's assets and deferred outflows, and liabilities and deferred inflows, with the difference between being reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.
The statement of activities presents information showing how the City's net position changed during the most recent fiscal year. All changes in net position is reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
The government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (government activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, community development, recreation and community services, and public works. The City has no business-type activities.
The Governmental Activities are presented on the accrual basis of accounting, a basis of accounting that differs from the modified accrual basis of accounting used in presenting governmental fund financial statements. Note 1 of the Notes to the Basic Financial Statements fully describe these bases of accounting.
Fund financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other local governments, uses fund accounting to ensure and
6 demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into two categories: governmental funds and proprietary funds.
Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements.
However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government's near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.
The City maintains sixteen individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the General Fund. Data from the other fifteen governmental funds are combined into a single, aggregated presentation.
Individual fund data for each of these non-major governmental funds are provided in the form of combining statements elsewhere in this report.
The City adopts an annual appropriated budget for its General Fund. A budgetary comparison statement has been provided for the General Fund to demonstrate compliance with this budget.
Proprietary funds. Proprietary funds are used to account for activities where the City needs to show the full costs of providing the services, including depreciation. The City maintains five internal service funds.
The City uses internal service funds to account for its self-insured insurance programs, fleet of vehicles, equipment, technology upgrades and replacements and other capital related activities. Because these services benefit governmental functions, they have been included within governmental activities in the government-wide financial statements. Internal service funds are presented as proprietary funds because internal service funds follow the accrual basis of accounting.
Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements.
Combining statements. The combining statements referred to earlier in connection with non-major governmental funds are presented immediately following the notes.
7 Government-wide Financial Analysis
Tables 1 and 2 focus on the net position and changes in net position of the City's governmental activities.
The City’s assets and deferred outflows exceeded liabilities and deferred inflows by $13,701,004 as of June 30, 2022, an increase of $5,532,920 from June 30, 2021.
The largest portion of the City's net position reflects its investment in capital assets (i.e., land, buildings, machinery, equipment and infrastructure), net of any related debt that is still outstanding used to acquire those assets. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Unrestricted net position had a deficit balance of $5.197 million as of June 30, 2022, which relates to the City's net pension liability and OPEB liability.
The City has set-aside $3.40 million for its unfunded pension liability and $500,000 for its OPEB liability. However, since these funds are not held in an irrevocable trust the net pension liability has not been reduced to account for these funds that have been set-aside.
TABLE 1
Net Position
Governmental Activities - June 30,
2021 2022
Current and other assets $ 19,033,063 $ 23,872,535
Capital assets 18,966,258 19,871,393
Total assets 37,999,321 43,743,928
Deferred outflows of resources 6,862,828 11,377,136
Current liabilities 1,651,802 3,002,887
Noncurrent liabilities:
Long-term debt 3,799,410 3,767,244
Net OPEB liability 6,694,357 6,356,967
Net pension liability 22,139,759 14,540,568
Total liabilities 34,285,328 24,664,779
Deferred inflows of resources 2,408,655 13,752,394
Net position:
Net investment in capital assets 15,623,413 16,544,999
Restricted 2,152,916 2,353,211
Unrestricted (9,608,245) (5,197,206)
Total net position 8,168,084 $ 13,701,004 $
8 A condensed summary of activities for the period ended June 30, 2022 and the prior fiscal year is illustrated in Table 2 below.
TABLE 2
Changes in Net Position
Governmental Activities - June 30,
2021 2022
Revenues
Program revenues:
Charges for services $ 2,272,437 $ 2,340,283
Operating contributions and grants 1,872,432 676,663
Capital contributions and grants 241,536 308,236
General revenues:
Taxes:
Property taxes 4,454,779 4,731,563
Utility users tax 1,834,203 2,122,966
Transit Occupancy Tax 223,450 522,187
Sales taxes 4,854,583 9,670,952
Franchise taxes 725,261 1,070,638
Business licenses 885,569 728,490
Other taxes 548,278 639,883
Investment income 77,885 (665,298)
Other 83,209 528,857
Total revenues 18,519,270 22,229,772
Expenses
General government 3,493,213 2,547,884
Public safety 7,134,874 6,382,127
Community development 956,687 1,343,945
Recreation and community services 1,471,231 2,043,092
Public works 2,907,145 3,225,592
Interest on long-term debt 138,286 330,585
Total expenditures 16,293,735 15,680,926
Change in net position 2,225,535 6,548,846
Net position, beginning, as restated 7,152,158 5,942,549 Net position, ending 8,168,084 $ 13,701,004 $
9 Governmental Activities. Governmental activities increased the City's net position by $5,532,920 compared to a net increase of $2,225,535 in the prior year. Key elements of this year's activity in relation to the prior year are as follows:
Revenues
While variances between years exist for the various revenue categories, the total net increase was $3,710,502, which is largely attributable to the $4,816,369 increase in sales tax. This was attributable to the passage of Measure Y 1.5%, Local Sales Tax.
Expenses:
Although variances between years exist for the various expense functions, the total net decrease was $612,809. Decreased expenditures were recognized in General Government, Public Safety, and interest and fiscal charges. Table 3 below presents the cost of each of the City's six largest programs-general government, public safety, community development, recreation and community services, public works, and interest and fiscal charges as well as their respective program revenues.
Table 3 below represents the cost of each of the City’s six largest programs – general government, public safety, community development, recreation and community services, public works, and interest and fiscal charges, as well as their respective program revenues.
TABLE 3
Expenses and Program Revenues
See the Statement of Activities for further detail on program revenues and general revenues. ‐
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
General
Government
Public Safety Community
Development
Recreation &
Community
Servivces
Public Works Interest on
Long‐Term Debt
2022 Expenses 2021 Expenses 2022 Program Revenues 2021 Program Revenues
10 FINANCIAL ANALYSIS OF THE CITY'S MAJOR FUNDS
The City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
Governmental funds. The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City's financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year.
As of the end of the current fiscal year, the City's governmental funds reported combined ending fund balance of $19,255,631, an increase of $3,388,299 (21%) from the prior fiscal year's balance. Of this amount, $4,439,441 or 23.06% of fund balance is constrained by the City's intent to utilize fund balance for specific purposes, which is reported within the fund balance classification assigned. Additionally, $2,353,211 or 12% of fund balance is restricted, which represents the portion of fund balance that is subject to externally enforceable limitations by law, enabling legislation or limitations imposed by creditors or grantors.
The fund balance of the City's General Fund increased by $4,173,344 during the fiscal year compared to a $3,334,055 increase in the prior year. The increase in the current year is primarily attributable to the increase in sales tax revenue.
Other governmental funds realized an increase in fund balance of $230,881. While variances between years exist for the various nonmajor governmental funds, the net increase was primarily attributable to an increase in funding for Measure M and State Gas Tax, in other restricted amounts.
General Fund Budgetary Highlights
Actual revenues were $2,255,980 more than the final budgeted amount, which is primarily due to increased property and sales tax and intergovernmental charges. The expenditures for the General Fund at fiscal year-end were $960,528 less than the final budgeted expenditures, which is primarily due to a decrease in public safety resulting from vacant positions.
No budget amendments were made during the fiscal year.
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets. At the end of Fiscal Year 2021-22, the City had $19.9 million invested in capital assets, including land, buildings, infrastructure, and equipment. This amount represents a net increase of $905,135, which is primarily due to increases in vehicles, infrastructure, and construction in progress.
11 More detail on the City’s capital assets can be found in Note 5 to the financial statements of this report.
Long-term liabilities. At the end of fiscal year 2021-22, the City had $4.1 million in longterm liabilities which includes outstanding bond indebtedness of $3.35 million along with a capital lease, claims payable and compensated absences. The net increase of $80,006 over the prior year is primarily due to a net increase in compensated absences.
More detail on the City’s long-term debt can be found in Notes, 6, 7 and 12 to the financial statements of this report.
TABLE 4
City of Los Alamitos Capital Assets Net of Depreciation Governmental Activities
2021 2022
Land $ 5,917,715 $ 5,917,715
Buildings and Improvements 758,692 716,299
Equipment 254,610 321,731
Vehicles 167,792 224,014
Infrastructure 11,292,992 11,510,215
Construction in progress 624,720 1,181,419
Totals $ 19,016,521 $ 19,871,393
TABLE 5
City of Los Alamitos Long-Term Liabilities
Governmental Activities
2021 2022
2015 Certificates of participation 3,342,845 $ 3,350,121 $ Capital lease - police vehicles 68,008 62,238
Claims payable 150,663 222,973
Compensated absences 481,842 488,032
Total liabilities $ 4,043,358 $ 4,123,364
ECONOMIC FACTORS AND NEXT YEAR'S BUDGET
The economy will face challenges in the coming year. Inflation will be a major factor, reflecting imbalances with supply and demand related to the pandemic. The U.S. Treasury will be countering the growth with planned rate hikes. Other factors include supply chain shortages, and global unrest, that will result in hardships and unknown implications on the U.S. economy. According to HdL, the City Sales Tax Consultant, a slowdown is predicted in the later part of 2022 and into to 2023. As such, the budget was prepared using a conservative approach.
On June 13, 2022, the 2022-23 City Budget was adopted. The annual operating budget is balanced, with operating revenues of $21,348,825 and operating expenditures of $20,367,325, resulting in an estimated surplus of $981,500.
Following the adoption of the FY2020-21 budget, the City Council and the residents of Los Alamitos took action. After the City Council unanimously voted to place a revenue measure on the ballot, residents voted to enact a 1.5% sales tax that would be dedicated to ensuring essential services and Los Alamitos residents’ quality of life. This new revenue source will allow for the city to continue to provide the needed services to the community, while addressing infrastructure deficiencies.
CONTACTING THE CITY'S FINANCIAL MANAGEMENT
This financial report is designed to provide the City of Los Alamitos citizens, taxpayers, customers, investors, and creditors with a general overview of the City's finances and to illustrate the City's accountability for the money it receives. If you have questions about this report or need additional financial information, contact the City's Finance Department at the City of Los Alamitos, 3191 Katella Avenue, Los Alamitos, California, 90720, (562) 431- 3538.
13 BASIC FINANCIAL STATEMENTS
14 GOVERNMENT-WIDE
FINANCIAL STATEMENTS
Governmental
Activities
ASSETS
Current assets:
Cash and investments (Note 3) 21,302,076 $
Receivables
Accounts 728,406
Due from employees 1,531
Due from other governments 1,837,614
Prepaid costs 2,659
Cash and investments - restricted (Note 3) 249
Total current assets 23,872,535
Noncurrent assets:
Capital assets: (Note 5)
Non-depreciable 7,099,135
Depreciable, net 12,772,258
Total capital assets 19,871,393
Total noncurrent assets 19,871,393
Total assets 43,743,928
DEFERRED OUTFLOWS OF RESOURCES
Deferred charge on refunding 85,965
Pension deferrals (Note 9) 8,980,782
OPEB deferrals (Note 10) 2,310,389
Total deferred outflows of resources 11,377,136
CITY OF LOS ALAMITOS
Statement of Net Position
June 30, 2022
See accompanying notes to the basic financial statements. 15
Governmental
Activities
LIABILITIES
Current liabilities:
Accounts payable 910,958 $
Accrued liabilities 335,009
Accrued interest 32,109
Unearned revenue 1,305,392
Deposits payable 63,299
Compensated absences, due within one year (Note 6) 181,844 Bonds payable, due within one year (Note 7) 89,434
Capital leases, due within one year (Note 7) 12,967
Claims payable, due within one year (Note 12) 71,875
Total current liabilities 3,002,887
Noncurrent liabilities:
Compensated absences (Note 6) 306,188
Bonds payable (Note 7) 3,260,687
Capital leases (Note 7) 49,271
Claims payable (Note 12) 151,098
Other post-employment benefits liability (Note 10) 6,356,967 Net pension liability (Note 9) 14,540,568
Total noncurrent liabilities 24,664,779
Total liabilities 27,667,666
DEFERRED INFLOWS OF RESOURCES
Pension deferrals (Note 9) 12,212,746
OPEB deferrals (Note 10) 1,539,648
Total deferred inflows of resources 13,752,394
NET POSITION
Net investment in capital assets 16,544,999
Restricted for:
Cable television 73,947
Transportation 1,099,189
Public safety 323,343
Air quality 123,361
Parks 733,371
Total restricted 2,353,211
Unrestricted (Deficit) (5,197,206)
Total net position $ 13,701,004
Statement of Net Position (Continued)
June 30, 2022
CITY OF LOS ALAMITOS
See accompanying notes to the basic financial statements. 16
Operating Capital Total
Charges for Grants and Grants and Program
Expenses Services Contributions Contributions Revenue
Governmental activities:
General government 2,547,884 $ 1,034,978 $ 1,314 $ -$ 1,036,292 $ Public safety 6,382,127 410,622 430,502 - 841,124
Community development 1,343,945 2,512 4,667 - 7,179
Recreation and community
services 2,043,092 892,015 - - 892,015
Public works 3,225,592 240,180 156 308,236 548,572
Interest and fiscal charges 138,286 - - - -
Total governmental activities 15,680,926 $ 2,340,283 $ 676,663 $ 308,236 $ 3,325,182 $
CITY OF LOS ALAMITOS
Statement of Activities
For the Year Ended June 30, 2022
Functions/Programs
Program Revenues
See accompanying notes to the basic financial statements. 17
Net (expense)
Revenue and
Changes in
Net Position
Governmental activities:
General government $ (1,511,592)
Public safety (5,541,003)
Community development (1,336,766)
Recreation and community
services (1,151,077)
Public works (2,677,020)
Interest and fiscal charges (138,286)
Total governmental activities (12,355,744)
General revenues:
Taxes:
Property taxes, levied for general purpose 4,731,563
Utility users tax 2,122,966
Transient occupancy tax 522,187
Sales taxes 9,670,952
Franchise fees 1,070,638
Business license taxes 728,490
Other taxes 639,883
Total taxes 19,486,679
Investment earnings (665,298)
Other 83,209
Total general revenues 18,904,590
Change in net position 6,548,846
Net position - beginning of year (as restated Note 15) 7,152,158 Net position - end of year 13,701,004 $
Functions/Programs
CITY OF LOS ALAMITOS
Statement of Activities (Continued)
For the Year Ended June 30, 2022
See accompanying notes to the basic financial statements. 18
19 FUND FINANCIAL STATEMENTS
Governmental Fund Financial Statements
Proprietary Fund Financial Statements
GOVERNMENTAL FUND
FINANCIAL STATEMENTS
The Governmental Funds of the City are outlined below:
General Fund - The General Fund accounts for all revenues and expenditures used to finance the traditional services associated with a municipal government which are not accounted for in the other funds. These services include general government, safety, community development, recreation and community services, and public works.
Nonmajor Governmental Funds - Nonrnajor Governmental Funds is the aggregate of all the nonrnajor governmental funds. 20
Nonmajor Total
Governmental Governmental
General Funds Funds
Cash and investments (Note 3) $ 16,387,360 $ 2,805,469 $ 19,192,829 Receivables:
Accounts 710,628 5,676 716,304
Due from employees 1,531 - 1,531
Due from other governments 1,769,808 67,806 1,837,614
Prepaid costs 2,659 - 2,659
Cash and investments - restricted (Note 3) - 249 249
Total assets $ 18,871,986 2,879,200 $ 21,751,186 $
Liabilities:
Accounts payable 543,286 $ 247,255 $ 790,541 $
Accrued liabilities 335,009 - 335,009
Unearned revenues 1,168,613 136,779 1,305,392
Deposits payable 12,556 50,743 63,299
Total liabilities 2,097,651 396,590 2,494,241
Deferred Inflows of Resources:
Unavailable revenue 1,314 - 1,314
Total deferred inflows of resources - 1,314 1,314
Fund Balances: (Note 14)
Nonspendable 4,190 - 4,190
Restricted - 2,353,211 2,353,211
Committed 2,620 119 2,739
Assigned 4,195,979 243,462 4,439,441
Unassigned (Deficit) (114,182) 12,570,232 12,456,050
Total fund balances 16,773,021 2,482,610 19,255,631
Total liabilities, deferred inflows of
resources and fund balances $ 18,871,986 2,879,200 $ 21,751,186 $
CITY OF LOS ALAMITOS
ASSETS
,
OF RESOURCES, AND FUND
BALANCES
Governmental Funds
June 30, 2022
Balance Sheet
See accompanying notes to the basic financial statements. 21
Total Fund Balances - Total Governmental Funds $ 19,255,631 Nondepreciable 7,099,134
Depreciable, net of Internal Service Fund of $719,045 12,053,214 Total capital assets 19,152,348
Total Internal Service Funds 2,433,487
Bonds payable (3,245,000)
Interest payable, net of Internal Service Fund of $1,279 (30,830) Unamortized bond premium (105,121)
85,965
(3,783,018) (488,032)
1,314
Pension related deferred outflows of resources 8,980,782 Pension related deferred inflows of resources (12,212,746) (14,540,568)
OPEB related deferred outflows of resources 2,310,389
OPEB related deferred inflows of resources (1,539,648)
(6,356,967)
Net position of governmental activities $ 13,701,004
CITY OF LOS ALAMITOS
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position
June 30, 2022
Amounts reported for governmental activities in the Statement of Net Position were reported differently because:
Deferred amounts relates to pension not available for current expenditures and are not reported in the governmental fund financial statements:
Net pension liability is not due and payable in the current period and therefore is not reported in the governmental funds.
Deferred amounts relates to other postemployment benefits not available for current expenditures and are not reported in the governmental fund financial statements:
Net OPEB liability is not due and payable in the current period and therefore is not reported in the governmental funds.
Capital assets used in governmental activities were not current financial resources.
Therefore, they were not reported in the Governmental Funds Balance Sheet.
Internal Service Funds are used by management to charge garage costs; technology replacement costs; police capital expenditures; facilities, street, parks, and pool capital expenditures; and self-insurance costs to individual funds. The assets and liabilities of the Internal Service Funds were included in the governmental activities in the Governmentwide Statement of Net Position.
Long-term liabilities are not due and payable in the current period and accordingly are not reported as fund liabilities. All liabilities, both current and long-term, are reported in the Statement of Net Position:
Compensated absences
Deferred charge on refunding
Certain revenues were not available to pay for current-period expenditures and, therefore, were deferred in funds.
See accompanying notes to the basic financial statements. 22
Nonmajor Total
Governmental Governmental
General Funds Funds
REVENUES:
Taxes 18,828,358 $ 658,321 $ 19,486,679 $
Licenses and permits 1,034,975 - 1,034,975
Intergovernmental 263,721 435,775 699,496
Charges for services 904,437 156 904,593
Investment earnings (loss) (684,765) 19,466 (665,299)
Fines and forfeitures 382,498 18,214 400,712
Program revenues - 284,090 284,090
Miscellaneous 448 40,826 41,274
Total revenues 20,770,050 1,416,470 22,186,520
EXPENDITURES:
Current:
General government 2,972,137 20,580 2,992,717
Public safety 6,617,305 - 6,617,305
Community development 1,292,094 - 1,292,094
Recreation and community services 1,911,542 - 1,911,542 Public works 2,801,366 150,246 2,951,612
Capital outlay 73,762 882,769 956,531
Debt service:
Principal - 80,000 80,000
Interest and fiscal charges - 130,494 130,494
Total expenditures 15,668,206 1,264,089 16,932,295
REVENUES OVER (UNDER)
EXPENDITURES 5,101,844 152,381 5,254,225
OTHER FINANCING
SOURCES (USES):
Transfers in (Note 4) 375,000 453,500 828,500
Transfers out (Note 4) (1,303,500) (375,000) (1,678,500) Total other financing sources (uses) 78,500 (928,500) (850,000) NET CHANGE IN FUND BALANCE 4,173,344 230,881 4,404,225
Fund balances, beginning of year, as restated (Note 15) 12,599,677 2,251,729 14,851,406 Fund balances, end of year $ 2,482,610 16,773,021 $ 19,255,631 $ Statement of Revenues, Expenditures, and Changes in Fund Balances
CITY OF LOS ALAMITOS
Governmental Funds
For the Year Ended June 30, 2022
See accompanying notes to the basic financial statements. 23
Net Change in Fund Balances - Total Governmental Funds $ 4,404,225 Governmental activities in the Statement of Activities were reported differently because:
Total capital outlay expenditures reported in governmental funds 957,075$ Plus: repair and maintenance expenditures capitalized 99,840 Total capital outlay 1,056,915
Total depreciation reported in Government-wide Statement of Activities (457,336) Less: depreciation reported in the Internal Service Fund 105,446 Total (351,890)
1,312
1,394,778
(281,801)
(6,190)
80,000
551
250,946
Change in net position of governmental activities $ 6,548,846 The issuance of long-term debt provides current financial resources to governmental funds. However, the repayment reduces long-term liabilities in the governmental activities Statement of Net Position.
Amortization of deferred charge on refunding does not use current financial resources and therefore not reported as expenditures in the governmental funds.
Internal Service Funds are used by management to charge garage costs; technology replacement costs; police capital expenditures; facilities, street, parks, and pool capital expenditures; and self-insurance costs to individual funds. The net revenue of the Internal Service Funds is reported in governmental activities.
CITY OF LOS ALAMITOS
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance to the Governmental-wide Statement of Activities For the Year Ended June 30, 2022
Governmental Funds report capital outlay as expenditures. However, in the Government-wide Statement of Activities, the costs of those assets is allocated over their estimated useful lives as depreciation expense. The amount of capital assets recorded in the current period is listed below.
Depreciation expense of capital assets is reported in the Government-wide Statement of Activities, but they do not require the use of current financial resources. Therefore, depreciation expense is not reported as expenditures in the governmental funds expect for the Internal Service fund amount listed below.
Earned but unavailable revenues reported in the governmental funds balance sheet as deferred inflows of resources should be recognized in the Government-wide Statement of Activities as revenue regardless of availability.
Certain pension expenses reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds.
Certain other postemployment benefit expenses reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds.
Compensated absences were reported in the Government-wide Statement of Activities, but they did not require the use of current financial resources. Therefore, compensated absences were not reported as expenditures in the governmental funds.
See accompanying notes to the basic financial statements. 24
25 This page intentionally left blank.
PROPRIETARY FUND
FINANCIAL STATEMENTS
26 Internal Service Funds - To account for the costs associated with the City's insurance, for funding equipment replacement, and fleet maintenance.
Governmental
Activities
Internal
Service Funds
ASSETS
Current assets:
Cash and investments (Note 3) 2,109,247 $
Accounts receivable 12,102
Total current assets 2,121,349
Noncurrent assets:
Capital assets - net of accumulated depreciation (Note 5) 719,045 Total noncurrent assets 719,045
Total assets 2,840,394
LIABILITIES
Current liabilities:
Accounts payable 120,417
Accrued interest 1,279
Accrued claims and judgements 71,875
Capital leases (Note 7) 12,967
Total current liabilities 206,538
Long-term liabilities:
Accrued claims and judgements 151,098
Capital leases (Note 7) 49,271
Total long-term liabilities 200,369
Total liabilities 406,907
NET POSITION
Net investment in capital assets 656,807
Unrestricted 1,776,680
Total net position $ 2,433,487
CITY OF LOS ALAMITOS
Statement of Net Position
Proprietary Funds
June 30, 2022
See accompanying notes to the basic financial statements. 27
Governmental
Activities
Internal
Service Funds
OPERATING REVENUES:
Charges for services
Garage $ 316,840
Police capital 40,000
Technology replacement 190,000
Miscellaneous 41,940
Total operating revenues 588,780
OPERATING EXPENSES:
Supplies and materials 340,220
Outside services 170,517
Claims expense 563,308
Depreciation 105,446
Total operating expenses 1,179,491
OPERATING INCOME (LOSS) (590,711)
NON-OPERATING REVENUES (EXPENSES):
Interest expense (8,343)
Total non-operating revenues (expenses) (8,343)
INCOME BEFORE TRANSFERS (599,054)
Transfers in (Note 4) 850,000
Total transfers 850,000
Change in net position 250,946
Net position, beginning of year 2,182,541
Net position, end of year 2,433,487 $
CITY OF LOS ALAMITOS
Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds
For the year ended June 30, 2022
See accompanying notes to the basic financial statements. 28
Governmental
Activities
Internal
Service Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from interfund charges for garage services 316,840 $ Receipts from interfund charges for police capital services 40,000 Receipts from interfund charges for technology replacement services 190,000 Payments to suppliers and service providers (935,505)
Cash received from (payments to) others 41,940
Net cash provided (used by) operating activities (346,725) CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES:
Transfers in 850,000
Net cash provided (used by) non-capital financing activities 850,000 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Acquisition and construction of capital assets (305,559) Principal paid on capital debt (5,570)
Interest paid on capital debt (8,572)
Net cash provided (used by) capital and related financing activities (319,701) Net increase (decrease) in cash and cash equivalents 183,574 Cash and equivalents, beginning of year 1,925,673
Cash and equivalents, end of year 2,109,247 $
RECONCILIATION OF OPERATING INCOME (LOSS) TO
NET CASH (USED BY) OPERATING ACTIVITIES:
Operating income (loss) (590,711) $
Adjustments to reconcile operating income (loss)
to net cash provided (used) by operating activities:
Depreciation 105,446
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable (4,146)
Increase (decrease) in accounts payable 70,376
Increase (decrease) in claims and judgements 72,310
Total adjustments 243,986
Net cash provided (used) by operating activities $ (346,725)
CITY OF LOS ALAMITOS
Statement of Cash Flows
Proprietary Funds
For the year ended June 30, 2022
See accompanying notes to the basic financial statements. 29
NOTES TO THE BASIC
FINANCIAL STATEMENTS
30
City of Los Alamitos
31 Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies
The basic financial statements of the City of Los Alamitos, California, (the “City”) have been prepared in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) as applied to governmental agencies.
The Governmental Accounting Standards Board (“GASB”) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The following is a summary of the City’s significant policies:
A. Financial Reporting Entity
The City was incorporated on March 1, 1960. The Charter of the City of Los Alamitos was adopted by a vote of the people in September 1966, and the City enjoys all rights and privileges pertaining to such “Charter Law” cities.
The financial statements include the financial activities of the City, the primary government, and its blended component unit, the Los Alamitos Public Financing Corporation (the Corporation). The component unit, discussed below, is included in the City’s reporting entity because of the significance of its operational and financial relationship with the City. This entity is legally separate from the City. However, the City’s elected officials have continuing accountability for fiscal matters of this entity.
An organization is fiscally dependent on the primary government if it is unable to adopt its budget, levy taxes or set rates or charges, or issue bonded debt without approval by the primary government. In a blended presentation, a component unit’s balances and transactions are reported in a manner similar to the balances and transactions of the City. Component units are presented on a blended basis when the component unit’s governing body is substantially the same as the City’s or the component unit provides services almost entirely to the City.
Management determined that the following entities should be reported as blended component units based on the criteria above. Each blended component unit has a June 30 year-end, has a governing board that is substantially the same as the City’s, there is a financial benefit or burden relationship between the City and the blended component unit, and the City is financially accountable for each of the blended component units.
The Los Alamitos Public Facilities Corporation – The Corporation was formed February 6, 2006, pursuant to the Non-Profit Corporation Law of the State of California for the purpose of assisting the City in financing the acquisition, construction and improvement for public benefit within the City limits. The Corporation is governed by a five-member board that is the City Council of the City of Los Alamitos. Separate financial statements are not prepared.
B. Basis of Accounting and Measurement Focus
The City’s basic financial statements consist of government-wide statements, including the Statement of Net Position and the Statement of Activities, and fund financial statements, which provide a more detailed level of financial information.
Government-Wide Financial Statements
The Statement of Net Position and the Statement of Activities display information about the City as a whole. These statements include the financial activities of the City and the Corporation. Certain eliminations have been made as prescribed by GASB Statement No. 34 in regard to interfund activities, payables, and receivables.
City of Los Alamitos
32 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) The Statement of Net Position presents the financial position of the governmental activities of the City and its component unit, and the Statement of Activities reports expenses of each specific governmental function, offset by program revenues attributable to each functional program. A function is an assembly of similar activities and may include portions of a fund or summarize more than one fund to capture the expenses and program revenues associated with a distinct functional activity.
Program revenues that are attributable to functional programs are separated into three categories:
Charges for services
Operating grants and contributions
Capital grants and contributions
Charges for services report fees and other charges to users of the City’s services, operating grants and contributions finance annual operating activities and can include restricted investment income, and capital grants and contributions fund the acquisition, construction or rehabilitation of capital assets. These revenues are subject to externally imposed restriction to these program uses. Other revenues sources not included with program revenues are reported as general revenues of the City. These can include taxes or unrestricted investment income.
Fund Financial Statements
The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, deferred outflows, liabilities, deferred inflows, fund equity, revenues, and expenditures or expenses as appropriate. The City uses two categories of funds: governmental and proprietary.
The City segregates transactions related to certain City functions or activities in separate funds in order to aid financial management and to demonstrate legal compliance. Fund financial statements are designed to present financial information of the City at a more detailed level. Individual governmental fund identified as being Major, as prescribed by governmental accounting standards or by Management of the City, are reported in separate columns on the financial statements.
Governmental Funds
Governmental funds are those through which most governmental functions typically are financed. Governmental fund reporting focuses on the sources, uses and balance of the current financial resources. Expendable assets are assigned to the various governmental funds according to the purpose for which they may or must be used. Fund liabilities are assigned to the fund from which they will be liquidated. The City reports the difference between its governmental fund assets and its liabilities and deferred inflows of resources as fund balance.
Governmental fund financial statements include a Balance Sheet and a Statement of Revenues, Expenditures, and Changes in Fund Balances for all major governmental funds and other governmental funds aggregated.
Accompanying reconciliations are presented to explain the differences in fund balance as presented in these statements to the net position presented in the government-wide financial statements.
City of Los Alamitos
33 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) The funds designated as major funds are determined by a mathematical calculation consistent with GASB Statement No. 34 or are elected by Management of the City based on Management’s belief that the presentation of the funds are particularly important to financial statement users for reasons including public interest or consistency of reporting. The City reports the following major governmental funds:
The General Fund is used to account for all of the general operations and other financial transactions of the City, which are not accounted for by another fund.
Additionally, the City reports the following fund types:
The Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than for debt service or capital projects) that are restricted by law or administrative action or committed to expenditures for specified purposes.
The Capital Projects Funds are used to account for and report financial resources that are restricted, committed, or assigned for the acquisition or construction of major capital facilities, other than those financed by Internal Service Funds.
The Debt Service Fund is used to account for and report financial resources that are restricted, committed, or assigned for the payment of, long-term debt principal, interest, and related costs for the 2006 Certificates of Participation (Laurel Park Acquisition).
Proprietary Funds
Proprietary funds are used to account for ongoing organizations and activities, which are operated and financed in a manner similar to those found in the private sector. The reporting focus on the determination of operating income, changes in net position, financial position, and cash flows. The City’s proprietary funds are classified as internal service funds.
The Internal Service Funds are used to account for interdepartmental operations where it is the stated intent that costs of providing services to the departments of the City on a continuing basis be financed or recovered primarily by charges to the user departments. The City’s internal service funds are used to account for its self-insured insurance programs, fleet of vehicles, equipment, technology upgrades, and replacements and other capital related activities.
Government-Wide Financial Statements
The government-wide financial statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources, including capital assets, infrastructure assets, and long-term liabilities, are included in the accompanying Statement of Net Position. The Statement of Activities presents changes in net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred. All internal balances and transactions have been eliminated from their respective statements to avoid over reporting relating assets, liabilities, revenues and expenses, except for internal service fund charges provided and used.
City of Los Alamitos
34 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Fund Financial Statements
All governmental funds are accounted for on a spending or “current financial resources” measurement focus and the modified accrual basis of accounting. Accordingly, only current assets and current liabilities are included on the Balance Sheet. The Statement of Revenues, Expenditures, and Changes in Fund Balances present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current position. Under the modified accrual basis of accounting, revenues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current period.
Like the government-wide statements, all proprietary funds are accounted for using the “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included on the Statement of Net Position. The Statement of Revenues, Expenses, and Changes in Net Position present increases (revenues) and decreases (expenses) in total net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred.
Basis of Accounting
Basis of accounting determines when transactions are recorded in the financial records and reported on the financial statements. Government-wide financial statements are prepared using the accrual basis of accounting. At the fund reporting level, the governmental funds use the modified accrual basis of accounting. Proprietary funds use the accrual basis of accounting at both reporting levels. Differences in the accrual and the modified accrual basis of accounting arise in the recognition of revenue, the recording of deferred inflows of resources, and in the presentation of expenses versus expenditures.
Revenue – Exchange Transactions
Revenue resulting from exchange transactions, in which each party gives and receives essentially equal value, is recorded on the accrual basis when the exchange takes place. On the modified accrual basis, revenue is recorded when the exchange takes place and in the fiscal year in which the resources are measurable and become available. Available means that the resources will be collected within the current fiscal year or are expected to be collected soon enough thereafter to be used to pay liabilities of the current fiscal year. For the City, the availability is defined within 60 days of year-end.
Revenue – Non-Exchange Transactions
Non-exchange transactions in which the City receives value without directly giving equal value in return, includes sales taxes, property taxes, grants and donations. On an accrual basis, revenue from sales taxes is recognized in the period in which the taxable sale takes place. Revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. Eligibility requirements include timing requirements, which specify the year when the resources are required to be used or the year when use is first permitted, matching requirements, in which the City must provide local resources to be used for a specified purpose, and expenditure requirements, in which the resources are provided to the City on a reimbursement basis. Major revenue sources susceptible to accrual include property tax, sales tax, utility users tax, franchise Tax, and licenses. On a modified accrual basis, revenue from non-exchange transaction also must be available (generally 60 days after year-end) before it can be recognized in the governmental funds. However, the City has adopted a 12-month recognition period for grant revenues.
City of Los Alamitos
35 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Unavailable Revenue
Unavailable revenue, presented under deferred inflows of resources, arise when potential revenues do not meet both the measurable and available criteria for recognition in the current period. In subsequent periods when both revenue recognition criteria are met, the deferred inflow is removed from the balance sheet and revenue is recognized.
Unearned Revenue
Unearned revenue arises when assets are recognized before revenue recognition criteria listed above have been satisfied. In subsequent periods when the government has a legal claim to the resources, the unearned revenue is removed from the balance sheet and revenue is recognized.
Expenses/Expenditures
On the accrual basis of accounting, expenses are recognized at the time they are incurred. On the modified accrual basis, expenditures generally are recognized in the accounting period in which the related fund liability is incured and due, if measurable.
Proprietary Funds Operating and Non-Operating Revenues and Expenses Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. Operating expenses for internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.
C. Cash, Cash Equivalents and Investments
Cash Management
The City pools cash resources of its various funds to facilitate cash management. Cash in excess of current requirements is invested and reported as investments. It is the City’s intent to hold investments until maturity.
However, the City may, in response to market conditions, sell investments prior to maturity in order to improve the quality, liquidity or yield of the portfolio. Interest earnings are apportioned among funds based on ending accounting period cash and investment balances.
Investments Valuation
In accordance with GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, highly liquid market investments with maturities of one year or less at time of purchase are stated at amortized cost. All other investments are stated at fair value. Market value is used as fair value for those securities for which market quotations are readily available.
State Investment Pool
The City participates in the Local Agency Investment Fund (LAIF), an investment pool managed by the State of California. LAIF has invested a portion of the pool funds in structured notes and asset-backed securities. LAIF’s investments are subject to credit risk with the full faith and credit of the State of California collateralizing these investments. In addition, these structured notes and asset-backed securities are subject to market risk as a result of changes in interest rates.
City of Los Alamitos
36 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) C. Cash, Cash Equivalents and Investments (Continued)
Cash Equivalents and Cash Flows
For purposes of the statement of cash flows, the City considered all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. All cash and investments of the proprietary fund types are pooled with the City's pooled cash and investments.
D. Internal Receivable and Payables
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “due to/from other funds” (i.e. the current portion of interfund loans) or “interfund advances receivable/payable” (i.e. the non-current portion of interfund loans). All other outstanding balances between funds are reported as “due to/from other funds.” Advances between funds, as reported in the fund financial statements, are presented as nonspendable in fund balances to indicate that they are not in a spendable form.
E. Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items.
The cost of prepaid items is recorded as an expenditure/ expense when consumed.
F. Capital Assets
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks and similar items), are reported in the applicable governmental activities column in the government-wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of two years, except for computer software and hardware and infrastructure assets which have a capitalization threshold of $20,000. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed (except for intangible right-to-use assts), the measurement of which is discussed thereafter. Donated capital assets are recorded at acquisition value at the date of acquisition.
As permitted under GASB Statement No. 34 for small governmental entities, the City has elected to report infrastructure assets prospectively beginning July 1, 2003.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized.
Property, plant, and equipment of the primary government, as well as the component unit, are depreciated using the straight-line method over the following estimated useful lives:
Equipment 5 - 10 years
Vehicles 4 - 15 years
Furniture 7 years
Buildings 50 years
Improvements 5 - 20 years
Infrastructure 50 years
City of Los Alamitos
37 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) G. Compensated Absences Payable
Under certain circumstances and according to the negotiated labor agreements, employees of the City are allowed to accumulate annual leave. This amount is accrued in the government-wide and proprietary fund statements. Refer to Note 6 for additional information.
H. Long-Term Obligations
In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities.
In accordance with GASB Statement No. 65, Items Previously Reported as Assets and Liabilities, debt issuance costs except for any portion related to prepaid insurance were recognized as expense in the period incurred.
I. Claims and Judgments
The City records a liability for claims, judgments, and litigation when it is probable that an asset has been impaired, or a liability has been incurred prior to fiscal year-end and the probable amount of loss (net of any insurance coverage) can be reasonably estimated.
The City is exposed to various risks of losses related to torts; theft of, damages to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City currently reports all of its risk management activities in its General Fund. Claims expenditures and liabilities are reported when it is probable that a loss has occurred, and the amount of the loss can be reasonably estimated. These losses include an estimate of claims that have been incurred, but not reported.
It is the City’s policy to liquidate claims and judgments existing at June 30, with future resources. Accordingly, the liabilities are recorded in the Statement of Net Position. These noncurrent amounts will be recorded as fund expenditures in the fiscal year in which they are paid or become due on demand.
J. Deferred Outflows and Inflows of Resources
In addition to assets, the statements of net position and the governmental funds balance sheet will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net assets that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/ expenditure) until then. The City has two items which qualify for reporting in this category.
Deferred pension related items relate to the net pension obligation reported in the statement of net position.
These outflows are the results of contributions made after the measurement date, which are recognized in the following year, and consist of adjustments due to differences in proportions, changes in assumptions, and differences between expected and actual experiences, which are deferred and amortized over the expected average remaining life time. Additionally, the net difference between projected and actual earnings on pension plan investments is reported and amortized over 5 years. Deferred outflows from changes in net pension liability arise only under a full accrual basis of accounting and are reported in the government-wide Statement of Net Position and proprietary funds Statement of Net Position.
The City also reports a deferred charge on refunding which results from the difference in the carrying value of the refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunded or refunding debt.
City of Los Alamitos
38 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) J. Deferred Outflows and Inflows of Resources (Continued) In addition to liabilities, the statements of net position and the governmental funds’ balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net assets that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has two items which qualifies for reporting in this category. The first item is in relation to the net pension obligation reported in the statement of net position.
These inflows are the results of changes of assumptions, differences between expected and actual experiences, adjustments due to differences in proportions, and differences between proportionate share of contributions and actual contributions. Inflows from changes in net pension liability arise only under a full accrual basis of accounting and are reported in the government-wide Statement of Net Position and proprietary funds Statement of Net Position
The City also reports one type of item, which arises only under the modified accrual basis of accounting, that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds’ balance sheet. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available.
K. Net Position
Net position is the excess of all the City’s assets over all its liabilities, regardless of fund. Net position is divided into three captions under GASB Statement No. 34. These captions apply only to net position, which is determined only at the government-wide level, and are described below:
Net Investment in Capital Assets – the portion of net position that is represented by the current net book value of the City’s capital assets, less the outstanding balance of any debt issued to finance these assets. Restricted – the portion of net position that is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws or other restrictions, which the City cannot unilaterally alter. These principally include funds restricted to community development projects purposes and funds for use in building improvements and governmental grants. Unrestricted – the portion of net position that is not restricted as to use.
L. Net Position Flow Assumptions
Sometimes the City will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted – net position and unrestricted – net position in the government-wide and proprietary fund financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the City’s policy to consider restricted – net position to have been depleted before unrestricted – net position is applied.
City of Los Alamitos
39 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) M. Fund Balance
In the fund financial statements, governmental funds report fund balance as nonspendable, restricted, committed, assigned, or unassigned based primarily on the extent to which the City is bound to honor constraints on how specific amounts can be spent.
Nonspendable – the portion of a fund balance that includes amounts that cannot be spent because they are either not in a spendable form, such as prepaid items, inventories, or loans receivable. Restricted – the portion of a fund balance that reflects constraints placed on the use of resources (other than non-spendable items) that are either (a) externally imposed by creditors (such as through debt covenants, grantors, contributors, or laws or regulations of other governments); or (b) imposed by law through constitutional provisions or enabling legislation. Examples of restricted fund balances include State Gas Tax, Asset Seizure, and Measure M funds.
Committed – the portion of a fund balance that included amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the government’s highest level of decision- making authority and remain binding unless removed in the same manner. a. The City Council, as the City’s highest level of decision-making authority, may commit fund balance for specific purposes pursuant to constraints imposed by formal actions taken, such as a resolution. b. These committed amounts cannot be used for any other purpose unless the City Council removes or changes the specified use through the same type of formal action taken to establish the commitment. c. City Council action to commit fund balance needs to occur within the fiscal reporting periods; however, the amount can be determined subsequently.
Assigned – amounts that are constrained by the City’s intent to be used for specific purposes, but are neither Restricted nor Committed, should be reported as Assigned fund balance. This policy hereby delegated the authority to assign amounts to be used for specific purposes to the City Manager for the purpose of reporting these amounts in the City’s annual financial statements. Examples of assigned fund balance are funds intended for Capital Improvement Projects and Equipment Replacement. Unassigned – residual net resources in excess of what can properly be classified in one of the other four categories and do not have any specific spending limitations. The General Fund is the only fund that reports a positive unassigned fund balance amount. In governmental funds, other than the General Fund, if expenditures incurred for specific purposes exceed the amounts that are restricted, committed, or assigned to those purposes, the City reports a negative unassigned fund balance in that fund.
In July 2017, City Council established a Reserve for Emergencies to be maintained at 25% of General Fund appropriations. The reserve is only to be used, with council approval, in the case of a declared natural disaster or financial emergency. A financial emergency is considered when annual revenues decrease by 5% or more or when annual expenditures increase by 5% or more.
City of Los Alamitos
40 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) N. Fund Balance Flow Assumptions
Sometimes the City will fund outlays for a particular purpose from both restricted and unrestricted resources (the total of committed, assigned, and unassigned fund balance). In order to calculate the amounts to report as restricted, committed, assigned, and unassigned fund balance in the governmental fund financial statements a flow assumption must be made about the order in which the resources are considered to be applied. It is the City's policy to consider restricted fund balance to have been depleted before using any of the components of unrestricted fund balance. Further, when the components of unrestricted fund balance can be used for the same purpose, committed fund balance is depleted first, followed by assigned fund balance. Unassigned fund balance is applied last.
O. Pensions
For purposes of measuring the net pension liability, deferred outflows and inflows of resources related to pensions, and pension expense, information about the pension plans fiduciary net positions and additions to/deductions from the pension plans fiduciary net positions have been determined on the same basis as they are reported by the CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fairvalue.
GASB 68 requires that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used.
Valuation Date (VD) June 30, 2020
Measurement Date (MD) June 30, 2021
Measurement Period (MP) June 30, 2021 to June 30, 2022
P. Other Post-Employment Benefits (OPEB)
For purposes of measuring the other post-employment benefits (OPEB) liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense have been determined by an independent actuary. For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.
Generally accepted accounting principles require that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used:
Valuation Date (VD) June 30, 2022
Measurement Date (MD) June 30, 2022
Measurement Period (MP) July 1, 2021 to June 30, 2022
Q. New Accounting Pronouncements
The City adopted Statement on Governmental Accounting Standards (GASB Statements) No. 87-Leases; No 89- Accounting for Interest Cost Incurred Before the End of a Construction Period; No. 90-Majority Equity Interest; No. 93-Replacement of Interbank Offered Rates; and No. 97-Certain Component Unit Criteria for Internal Revenue Code 457 Deferred Compensation Plans. The City implemented GASB No. 87 during fiscal year June 30, 2022. The adoption of the GASB Nos. 89, 90, 93, and 97 did not significantly impact the City.
City of Los Alamitos
41 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) R. Leases
Lessee: The City is a lessee for a noncancellable lease of equipment. The City recognizes a lease liability and an intangible right-to-use lease asset (lease asset) in the government-wide financial statements. The City recognizes lease liabilities with an initial, individual value of $5,000 or more.
At the commencement of a lease, the City initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of lease payments made. The lease asset is initially measured as the initial amount of the lease liability, adjusted for lease payments made at or before the lease commencement date, plus certain initial direct costs. Subsequently, the lease asset is amortized on a straight-line basis over its useful life.
Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments. The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for leases. The lease term includes the noncancellable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise.
The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability.
Lease assets are reported with other capital assets and lease liabilities are reported with long-term debt on the Statement of Net Position.
Lessor: At the commencement of a lease, the City initially measures the lease receivable at the present value of payments expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal portion of the lease payments received. The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term.
Key elements and judgement include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts. The City uses it estimated incremental borrowing rate as the discount rate for leases. The lease term includes the noncancellable period of the lease. Lease receipts included In the measurement of the lease receivable is composed of fixed payments from the lessee.
The City monitors changes that would require a remeasurement of its lease and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable. The City currently does not have any leases receivable.
City of Los Alamitos
42 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) S. Property Taxes
Under California law, property taxes are assessed and collected by the counties at up to 1% of assessed value, plus other increases approved by the voters. The property taxes go into a pool and are then allocated to the cities based on complex formulas.
Property taxes are assessed, collected and allocated by Orange County throughout the fiscal year according to the following property tax calendar.
Lien Date January 1
Levy Date July 1 to June 30
Due Dates November 1, 1st installment, February 1, 2nd installment Delinquent Dates December 11, 1st installment, April 11, 2nd installment Property taxes receivable for the governmental fund types, which have been remitted within 60 days subsequent to year end, are considered measurable and available and recognized as revenues. All other property taxes are offset by deferred property tax inflows of resources and, accordingly, have not been recorded as revenue. Taxes are considered past due on the above delinquent dates, at which time the applicable property is subject to lien, and penalties and interest are assessed.
T. Functional Classifications
Expenditures of the Governmental Funds are classified by function. Functional classifications are defined as follows:
General government – includes legislative activities, which have a primary objective of providing legal and policy guidelines for the City. Also included in this classification are those activities that provide management or support services across more than one functional area. Public safety – includes those activities that involve the protection of people and property. Community development – includes those activities such as planning, code enforcement, and building and safety inspections.
Recreation and community services – includes those activities that involve the community cultural and leisure activities.
Public works – includes those activities that involve the maintenance and improvement of City streets, roads, and park development and maintenance.
Capital outlay – includes purchases of property, plant and equipment which are expensed in the governmental funds because governmental funds use the current financial resources measurement focus. Principal retirement – includes principal payments for long-term liabilities. Interest and fiscal charges – includes current payments for interest on the City’s long-term debt.
City of Los Alamitos
43 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 1 – Summary of Significant Accounting Policies (Continued) U. Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
Note 2 – Stewardship, Compliance, and Accountability
A. Violations of Legal or Contractual Provisions
Note 2 to Required Supplementary Information, on the Excess of Expenditures over Appropriations, describes budgetary violations that occurred in the General Fund for the year ended June 30, 2022.
B. Deficit Fund Balance
At June 30, 2022, the Community Development Block Grant (CDBG) nonmajor special revenue fund reported a deficit fund balance of $114,182. The deficit is due to the timing of the receipt of CDBG program reimbursements for expenditures incurred. The deficit will be eliminated as the program reimbursements are received from the grantor agency.
Note 3 – Cash and Investments
A. Summary of Cash and Investments
At June 30, 2022, the City reported $21,302,076 in unrestricted cash and investments and $249 in restricted cash and investments held with fiscal agents for a total cash and investment balance of $21,302,325. Total cash and investments consisted of the following:
Cash on hand $ 3,500
Demand deposits 796,570
Investments 20,502,255
Total Cash and Investments $ 21,302,325
The City follows the practice of pooling cash and investments of all funds except for funds required to be held by fiscal agents under provisions of bond indentures. Interest income earned on pooled cash and investments is allocated monthly to the various funds based on monthly cash and investment balances. Interest income from cash and investments with fiscal agents is credited directly to the related fund.
City of Los Alamitos
44 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 3 – Cash and Investments (Continued)
B. Cash Deposits
The carrying amounts of the City’s cash deposits were $796,570 at June 30, 2022. Bank balances before reconciling items were $549,966 at that date. The difference of $246,604 represents outstanding checks, cash deposits in transit, and other reconciling items.
All City’s cash and investments as of June 30, 2022, were collateralized or insured with securities held by pledging financial institutions in the City’s name. The California Government Code requires California banks and savings and loan associations to secure the City’s cash deposits by pledging securities as collateral. This Code states that collateral pledged in this manner shall have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus, collateral for cash deposits is considered to be held in the City’s name.
C. Investments
The following table identifies the investment types that are authorized for the City by the California Government Code (or the City’s investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code (or the City’s investment policy, where more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of bond indentures of the City, rather than the general provisions of the California Government Code or the City’s investment policy.
Maximum Maximum
Maximum Percentage Investment in
Authorized Investment Type Maturity of Portfolio* One Issuer United States (U.S.)Treasury Obligations 5 years None None Federal Agency Securities 5 years None None
Certificates of Deposit 5 years None $250,000
Negotiable Certificates of Deposit 5 years 30% 30%
Local Agency Investment Fund (LAIF) N/A None $50 million * Excludes amounts held by bond trustees that are not subject to California Government Code restrictions.
Investments of debt proceeds held by bond trustees are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy.
Maximum Maximum
Maximum Percentage Investment in
Authorized Investment Type Maturity of Portfolio One Issuer U.S. Treasury Obligations 30 years None None
U.S. Agency Securities None None None
Banker's Acceptances 180 days 40% 30%
Commercial Paper 270 days 25% 10%
Money Market Mutual Funds None None None
Investment Agreements None None None
Local Agency Bonds None None None
Medium Tern Notes 5 years 30% None
Negotiable Certificates for Deposits None 30% None
Local Agency Investment Fund (LAIF) None None None
City of Los Alamitos
45 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 3 – Cash and Investments (Continued)
C. Investments (Continued)
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The fair value of the City’s investment in this pool is reported in the accompanying financial statements at amounts based upon the City’s pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawals is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. LAIF does not impose limits or restrictions on participant withdrawals, and the entire balance of the City’s investment in the portfolio is available for withdrawal at any time. LAIF is not registered with the Securities and Exchange Commission and is not rated.
Deposits and withdrawals in LAIF are made on the basis of $1 and not fair value. Accordingly, the City’s investment in this pool is measured on uncategorized inputs not defined as Level 1, 2, or 3.
D. Risk Disclosures
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment.
Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer-term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations.
Information about the sensitivity of the fair values of the City’s investments (including investments held by bond trustees) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity:
Remaining Investment Maturities
Less than 1 to 3 4 to 5
Investment Type 1 Year Years Years Total
U.S. Treasury Obligations $ - $ 938,242 $ 226,983 $ 1,165,225 U.S. Agency Securities - 3,177,967 4,949,937 8,127,904
Certificates of Deposit 743,167 732,413 1,373,104 2,848,684 Agency Investment Fund (LAIF) 8,360,193 - - 8,360,193
Investment held by Bond Trustee:
Money Market Mutual Funds 249 - - 249
Total $ 9,103,609 $4,848,622 $6,550,024 $20,502,255
City of Los Alamitos
46 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 3 – Cash and Investments (Continued)
D. Risk Disclosures (Continued)
Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements, and the actual rating, by Standards and Poor, as of fiscal year end for each investment type:
Minimum
Legal
Not
Investment Type Total Rating Rated AAA AA+
U.S. Treasury Obligations $1,165,225 N/A $ - $1,165,225 $ - U.S. Agency Securities 8,127,904 N/A - 8,127,904 -
Certificates of Deposit 2,848,684 N/A 2,848,684 - -
Agency Investment Fund (LAIF) 8,360,193 Not Rated 8,360,193 - - Investment held by Bond Trustee:
Money Market Mutual Funds 249 N/A - - 249
Total $20,502,255 $11,208,877 $9,293,129 $ 249
Concentration of Credit Risk
The City’s investment policy imposes restrictions on the percentage that the City can invest in certain types of investments. As of June 30, 2022, in accordance with GASB Statement No. 40 requirements, the City is exposed to concentration of credit risk whenever they have invested more than 5% of their total investments in any one issuer.
Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. The City’s investment policy does not contain any additional provisions that would limit the exposure to custodial credit risk for deposits. However, the policy does stipulate that mortgage collateral cannot be used to secure deposits, and that the use of a third-party bank trust department is to act as the City’s safekeeping agent for investments. At June 30, 2022, City deposits (bank balances) were insured by the Federal Depository Insurance Corporation or collateralized as required under California Law.
City of Los Alamitos
47 Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
Note 3 – Cash and Investments (Continued)
D. Risk Disclosures (Continued)
Fair Value Hierarchy
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset.
Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.
The City has the following recurring fair value measurements as of June 30, 2022:
Level
Investments Totals 1 2 Uncategorized
U.S. Treasury Obligations $ 1,165,225 $ 1,165,225 $ - $ - U.S. Agency Securities 8,127,904 8,127,904 - -
Certificates of Deposit 2,848,684 - 2,848,684 -
Local Agency Investment Fund (LAIF)
Investment Held by Fiscal Agent
8,360,193 - - 8,360,193
Money Market Funds 249 249 - -
Totals $ 20,502,255 $ 9,293,378 $ 2,848,684 $ 8,360,193 Deposits and securities classified in Level 1 of the fair value hierarchy are valued using prices quoted in active markets for those securities. Federal Agency Securities classified in Level 2 of the fair value hierarchy are valued using institutional bond quotes.
Note 4 – Interfund Transactions
A. Receivables/Payables
The purpose of the interfund transactions is to make short-term interfund loans from the General Fund to nonmajor governmental funds. These interfund loans are to provide for negative cash balances at year-end and/or operating cash flow. Due to/from amounts are short-term financing, which are paid within one year. There were no such balances as of June 30, 2022.
B. Transfers In/Out
Transfers Out
Nonmajor
Governmental
Transfers In General Fund Funds Total
General Fund $ - $ 375,000 $ 375,000
Nonmajor Governmental Funds 453,500 - 453,500
Internal Service Funds 850,000 - 850,000
Total $ 1,303,500 $ 375,000 $ 1,678,500
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
48 Note 4 – Interfund Transactions (Continued)
B. Transfers In/Out (Continued)
Transfers to the General Fund from the Nonmajor Governmental Funds were made to fund street maintenance, partially offset the cost of police services, and to partially offset the cost of the Police Department motor officer program and other costs pertaining to traffic safety programs. Transfers to the Other Governmental Funds from the General Fund were made to make principal and interest payments of debt issued for the Laurel Park purchase.
Transfers to the Internal Services Funds from the General Fund were made to set aside fund for claim reserves, in case of any future incidents.
Note 5 – Capital Assets
A summary of changes in the Governmental Activities capital assets for the fiscal year ended June 30, 2022 are as follows:
Beginning Ending
Description Balance Additions Deletions Balance
Non-depreciable:
Land $ 5,917,715 $ - $ - $ 5,917,715
Construction in process 624,720 1,056,916 (500,216) 1,181,420 Total non-depreciable 6,542,435 1,056,916 (500,216) 7,099,135 Depreciable:
Buildings and improvements 2,295,266 - - 2,295,266
Equipment 1,266,120 126,030 (56,015) 1,336,135
Right-to-use – leased vehicles 50,263 25,518 - 75,781
Vehicles 1,173,866 103,744 - 1,277,610
Infrastructure- road system 14,109,191 500,215 - 14,609,406 Total depreciable
capital assets 18,894,706 755,507 (56,015) 19,594,198
Less accumulated depreciation for:
Buildings and improvements 1,536,574 42,393 - 1,578,967 Equipment 1,011,510 58,910 (56,015) 1,014,405
Right-to-use – leased vehicles - 16,780 - 16,780
Vehicles 1,056,337 56,260 - 1,112,597
Infrastructure- road system 2,816,199 282,992 - 3,099,191 Total accumulated
depreciation 6,420,620 457,335 (56,015) 6,821,940
Total depreciable
capital assets, net 12,474,086 298,172 - 12,772,258
Total capital assets, net $ 19,016,521 $1,355,088 $ (500,216) $19,871,393 Depreciation expense was charged to governmental activities as follows:
General
Internal
Service Total
General Government $ 18,280 $ - $ 18,280
Public Safety 22,851 - 22,851
Recreation and Community Services 54,840 - 54,840
Public Works 255,918 - 255,918
Internal Service Fund - 105,446 105,446
Totals $ 351,889 $ 105,446 $ 457,335
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
49 Note 5 – Capital Assets (Continued)
Expenditures
Spent-to-date
Remaining
Commitment
Construction commitments:
Government activities – street projects:
Year 1 Residential Street Improvements $ 70,650 $ 1,177,965 Howard Street from Noel to Lexington 100,957 30,043
Bloomfield from Farquhar to Katella 119,589 40,411
Suburbia Rehabilitation 157,715 29,269
Woodcrest and Carrier Row 19,398 209,685
Storm Drain Management Plan 64,860 10,140
Suburbia Street Project 49,124 73,822
Note 6 – Compensated Absences
The following is a summary of changes in compensated absences for the year ended June 30, 2022 is as follows:
Balance Balance Due within
July 1, 2021 Additions Deletions June 30, 2022 One Year Compensated absences $ 481,842 $ 229,747 $ 223,557 $ 488,032 $ 181,844 There is no repayment schedule for compensated absences. Employee leave benefits are payable to employees upon usage or termination. The City’s policies relating to the payment of these benefits are discussed in Note 1. The liability for compensated absences is typically liquidated through the General Fund.
Note 7 – Long-Term Debt
The following is a summary of changes in Governmental Activities long-term debt for the year ended June 30, 2022:
Balance Balance Due within
July 1, 2021 Additions Deletions June 30, 2022 One Year 2015 Certificates of Participation $ 3,325,000 $ - $ 80,000 $ 3,245,000 $ 85,000 Unamortized bond premium 109,555 - 4,434 105,121 4,434
$ 3,434,555 $ - $ 84,434 $ 3,350,121 $ 89,434
Other Long-term Liabilities:
Lease payable – Police Vehicles $ 68,008 $ - $ 5,770 $ 62,238 $ 12,967
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
50 Note 7 – Long-Term Debt (Continued)
A. 2015 Certificates of Participation
On September 1, 2015, the City issued the 2015 Certificates of Participation in the amount of $3,685,000, as a public offering, to refund the outstanding balance of the 2006 (Laurel Park Acquisition) Certificates of Participation in an advanced refunding transaction, and to finance the design, acquisition, and construction of certain capital improvement projects. There are no finance-related consequences related to significant events of default or termination, and there are no acceleration clauses. There are no assets pledged as collateral, no required reserve, and no unused lines of credit. Interest on the bonds is payable semiannually on October 1 and April 1, commencing April 1, 2016, at rates which range from 2.00% to 5.00%. Principal payments begin October 1, 2017 and continue October 1 of each year through October 1, 2045. The outstanding balance as of June 30, 2022 is $3,245,000. The annual debt service requirements on these bonds are as follows:
Year ending
June 30, Principal Interest Total
2023 $ 85,000 $ 125,444 $ 210,444
2024 85,000 121,194 206,194
2025 90,000 116,819 206,819
2026 95,000 112,194 207,194
2027 100,000 107,319 207,319
2028-2032 560,000 482,144 1,042,144
2033-2037 655,000 379,147 1,034,147
2038-2042 805,000 236,900 1,041,900
2043-2046 770,000 63,200 833,200
$ 3,245,000 $ 1,744,361 $ 4,989,361
B. Lease Payable – Police Vehicles
In December 2020, the City entered into two five-year lease agreements as lessee for the acquisition and use of two vehicles. Initial lease liabilities were recorded in the amounts of $31,142 and 42,533 during the current fiscal year as a result of implementation of GASB 87. As of June 30, 2022, the value of the lease liabilities were $16,254 and $22,204. The City is required to make monthly principal and interest payments of $519 and $708 for the vehicles. The leases both have an interest rate of 16.2%.
The vehicles both have a five-year estimated useful life. The value of the right-to-use asset as of June 30, 2022 was $21,244 and $29,019 less accumulated amortization of $6,373 and $8,706, respectively.
In March 2022, the City entered into a five-year lease agreement as lessee for the acquisition and use of a vehicle. An initial lease liability was recorded in the amount of $25,518 during the current fiscal year as a result of implementation of GASB 87. As of June 30, 2022, the value of the lease liability was $23,780. The City is required to make monthly principal and interest payments of $623 for the vehicle.
The lease has an interest rate of 16.2%. The equipment has a five-year estimated useful life. The value of the right-to-use asset as of June 30, 2022 was $25,518 less accumulated amortization of $1,701.
The following future principal and interest payments on the leases payable for June 30 are as follows:
Year ending
June 30, Principal Interest Total
2023 $ 12,967 $ 9,248 $ 22,215
2024 15,226 6,989 22,215
2025 17,888 4,327 22,215
2026 12,060 1,561 13,621
2027 4,097 292 4,389
$ 62,238 $ 22,417 $ 85,255
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
51 Note 8 – Defined Contribution Plans
The City provides pension benefits for all of its part time employees through a defined contribution plan. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. The plan is administered as part of the City’s 457 plan. Federal legislation requires contributions of at least 7.5% of the employees’ salary. For the fiscal year ended June 30, 2022, the City contributed $35,121. City employees are invested immediately. City Council has the authority to establish and amend the provisions of this plan.
Note 9 – Defined Benefit Pension Plans
A. Plan Description
The City contributes to the California Public Employees' Retirement System (CaIPERS), a cost-sharing multipleemployer public employee defined benefit pension plan for full-time safety and miscellaneous employees.
CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. CaIPERS acts as a common investment and administrative agent for participating public entities within the State of California. CaIPERS issues a publicly available financial report that includes financial statements and required supplementary information for the cost-sharing plans that are administered by CaIPERS. Copies of CalPERS' annual financial report may be obtained from their executive office at: 400 P Street, Sacramento, California 95814.
B. Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost-of-living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: The Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
52 Note 9 – Defined Benefit Pension Plans (Continued)
B. Benefits Provided (Continued)
The City has a multiple tier retirement plan with benefits varying by plan for both miscellaneous and safety employees hired on or before specific dates as follows:
Safety Employees
Legacy POA Employees – The retirement formula is 3% at age 50 for safety employees covered under the Los Alamitos Police Officers’ Association (POA) that were hired on or before December 31, 2012.
The employee is responsible for the employee share (9%). Non-Represented Safety Employees – The retirement formula for Non-Represented Safety Employees hired on or before December 31, 2012 is 3% at age 50. The employee is responsible for the employee share (9%).
Safety PEPRA Employees – The retirement formula is 2.7% at age 57 for new members hired on or after January 1, 2013. The employee must pay one-half (1/2) of the normal cost of the benefit. The normal cost is currently 23.49% - one-half of which is 11.745%, which is paid by the employee.
Classic members (CalPERS members prior to 12/31/12) hired on or after January 1, 2013 may be placed in a different tier.
Miscellaneous Employees
Legacy CEA Employees – The retirement formula is 2.7% at age 55 for miscellaneous employees covered under the Los Alamitos City Employees Association (CEA) hired on or before December 31, 2012. The employee is responsible for the employee share (8%).
Non-Represented Miscellaneous Employees – The retirement formula for Non-Represented Miscellaneous Employees hired on or before December 31, 2012 is 2.7% at age 55. The employee is responsible for the employee share (8%) with the exception of the City Manager whereby the City pays the employee share (8%).
Miscellaneous PEPRA Employees – The retirement formula is 2% at age 62 for new members hired on or after January 1, 2013. The employee must pay one-half (1/2) of the normal cost of the benefit. The normal cost is currently 12.783% - one-half of which is 6.3915%, which is paid by the employee.
Classic members (CalPERS members prior to 12/31/12) hired on or after January 1, 2013 may be placed in a different tier.
Additionally, the City is required to contribute the actuarially determined amounts necessary to fund the benefits for its members. The actuarial methods and assumptions used are those adopted by the CalPERS Board of Administration. The required employer contribution rates for fiscal year 2021-2022 are as follows:
Employer
Rates
Classic Miscellaneous Members 14.02%
PEPRA Miscellaneous Members 7.59%
Classic Safety Members 23.71%
PEPRA Safety Members 13.13%
The employer rate for each plan does not include the additional City payment made towards the unfunded pension liability. Payment towards the unfunded liability for the fiscal year ended June 30, 2022 was $1,677,621.
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
53 Note 9 – Defined Benefit Pension Plans (Continued)
C. Contribution Description
Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions.
For the year ended June 30, 2022, the contributions recognized as a reduction to the net pension liability for the miscellaneous and safety plans was $772,765 and $848,052, respectively.
D. Actuarial Methods and Assumptions Used to Determine Total Pension Liability The June 30, 2020 valuations were rolled forward to determine the June 30, 2021 total pension liabilities, based on the following actuarial methods and assumptions:
1 The mortality table used was developed based on CalPERS-specific data. The table includes 15 years of mortality improvements using the Society of Actuaries Scale 90% of scale MP 2016. For more details on this table, please refer to the December 2017 experience study report (based on CalPERS demographic data from 1997 to 2015) that can be found on the CalPERS website.
E. Long-term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses. The expected real rates of return by asset class are as followed:
Actuarial Cost Method
Actuarial Assumptions
Discount Rate
Inflation
Salary Increases
Mortality Rate Table1
Post Retirement Benefit Increase
Entry Age Normal in accordance with the requirements of GASB 68
7.15%
2.50%
Varies by Entry Age and Service
Derived using CalPERS' Membership Data for all Funds
Contract COLA up to 2.0% until Purchasing Power Protection Allowance Floor on Purchasing Power applies, 2.5% thereafter
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
54 Note 9 – Defined Benefit Pension Plans (Continued)
E. Long-term Expected Rate of Return
Assumed
Asset
Asset Class Allocation
Public equity 50.0%
Global fixed income 28.0%
Real assets 13.0%
Private equity 8.0%
Inflation sensitive assets 0.0%
Liquidity 1.0%
F. Discount Rate
The discount rate used to measure the total pension liability was 7.15%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
G. Subsequent Events
There were no subsequent events that would materially affect the results presented in this disclosure.
H. Amortization of Deferred Outflows and Deferred Inflows of Resources Under GASB 68, gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time.
The first amortized amounts are recognized in pension expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to pensionsand are to be recognized in future pension expense.
The amortization period differs depending on the source of the gain or loss:
The EARSL for PERF C (the CalPERS pool) for the measurement date ending June 30, 2021 is 3.7 years, which was obtained by dividing the total service years of 559,502 (the sum of remaining service lifetimes of the active employees) by 150,958 (the total number of participants: active, inactive, and retired) in PERF C. Inactive employees and retirees have remaining service lifetimes equal to 0. Total future service is based on the members’ probability of decrementing due to an event other than receiving a cash refund.
Net difference between projected and actual earnings on pension 5 year straight-line amortization plan investments
All other amounts Straight-line amortization over the expected average remaining service lifetime (EARSL) of all members that
are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
55 Note 9 – Defined Benefit Pension Plans (Continued)
I. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension
Net Pension Liability
As of June 30, 2022, the City reported net pension liabilities for its proportionate shares of the net pension liability of each Plan as follows:
Proportionate Share of Net Pension Liability
Miscellaneous $ 7,053,182
Safety 7,487,386
Total Net Pension Liability $ 14,540,568
The City’s net pension liability for each plan is measured as the proportionate share of the net pension liability. The net pension liability of each of the plans is measured as of June 30, 2020, and the total pension liability for each plan used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2020 rolled forward to June 30, 2021 using standard update procedures.
The City’s proportion of the net pension liability was based on a projection of the City’s long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined. The City’s proportionate share of the net pension liability for each plan as of June 30, 2020 and 2021, were as follows:
Miscellaneous Safety
Proportion – June 30, 2020 0.2450% 0.1772%
Proportion – June 30. 2021 0.3738% 0.2140%
Change – Increase (Decrease) 0.1288% 0.0368%
Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability of the City, calculated using the discount rate of 7.15%, as well as what the Plan’s net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (6.15%) or 1 percentage point higher (8.15%) than the current rate:
Discount Rate
-1%
(6.15%)
Current
Discount Rate
(7.15%)
Discount Rate
+1%
(8.15%)
Proportion – June 30, 2020 $11,611,367 $ 7,053,182 $ 3,326,094 Proportion – June 30. 2021 13,283,412 7,487,386 2,726,666 Change – Increase (Decrease) $24,894,779 $14,540,568 $ 6,052,760 Pension Expense and Pension Deferrals
For the year ended June 30, 2022, the City recognized a total pension expense of $491,685 for the Miscellaneous plan and $436,776 for the Safety plan, totaling $928,461 for all plans. At June 30, 2022, the City reported deferred outflows and deferred inflows of resources related to pensions as follows:
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
56 Note 9 – Defined Benefit Pension Plans (Continued)
I. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension
Deferred Outflows Deferred Inflows
Miscellaneous Plan of Resources of Resources
Contributions subsequent to measurement date $ 1,043,161 $ - Changes in assumptions - -
Difference between expected and actual experience 793,464 2,523 Net difference between projected and actual
earnings on pension plan investments 19,639 6,176,695
Adjustment due to differences in proportions
Difference between actual and proportionate share
3,063,933 262,567
of contributions 49,624 321,455
Subtotal Miscellaneous Plan 4,969,821 6,763,240
Safety Plan
Contributions subsequent to measurement date 1,280,078 - Changes in assumptions - -
Difference between expected and actual experience 1,281,287 2,073 Net difference between projected and actual
earnings on pension plan investments 7,222 4,463,655
Adjustment due to differences in proportions
Difference between actual and proportionate share
1,336,895 33,405
of contributions 105,479 950,373
Subtotal Safety Plan 4,010,961 5,449,506
Total All Plans $ 8,980,782 $ 12,212,746
The $2,323,239 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2023. Other amounts reported as deferred outflows or deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Deferred Outflows/(Inflows) of Resources
Fiscal Year
Ending June 30, Miscellaneous Safety Total
2023 $ (284,108) $ (326,250) $ ( 610,358)
2024 (238,549) (436,791) (675,340)
2025 (612,429) (729,233) (1,341,662)
2026 (1,701,494) (1,226,349) (2,927,843)
City of Los Alamitos
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
57 Note 10 – Other Post-Employment Benefit (OPEB) Plan
A. Plan Description
In addition to providing pension benefits, the City provides certain health care benefits, through a single- employer OPEB Plan (the Plan), for retired employees in accordance with a City Council resolution. Substantially, all the City’s employees become eligible for those benefits if they reach normal retirement age while working for the City. Those and similar benefits for active employees are provided through PERS whose premiums are based on the benefits paid during the year.
Retiree health care coverage is segregated into two tiers as follows:
Tier 1 – Employees Hired Before August 1, 1994(1) receive one of the following:
Miscellaneous and Safety Employees with 10 years of service with the City, with a regular service retirement, shall be eligible to receive 100% of the monthly benefit applicable towards the employee and one dependent, provided that employee plus one dependent coverage was in effect upon the date of retirement, up to Medicare age, and up to $300 per month thereafter for life. Employees age fifty (50) or over received up to $300 per month for life.
Tier 2 – Employees Hired on or After August 1, 1994(1) receive one of the following:
• Miscellaneous Employees with at least 15 years of continuous service with the City, and have reached the age of fifty-five (55) shall be eligible to receive 100% of the monthly benefit applicable towards the employee and one dependent, provided that employee plus one dependent coverage was in effect upon the date of retirement, up to Medicare age, and up to $300 per month thereafter for life. • Safety Employees with 10 years of service with the City shall be eligible to receive 50% of the monthly benefit applicable towards the employee and one dependent, if employee plus one dependent coverage was in effect upon the date of retirement. The percentage increases by 5% per year to 100% at 20 years of service up to Medicare age, and up to $300 per month thereafter for life. (1) Applies to police employees hired after January 1, 1995.
B. Employees Covered
As of the June 30, 2022 actuarial valuation, the following current and former employees were covered by the benefit terms under the Plan:
Active 50
Inactive employees or beneficiaries currently receiving benefits 47 Inactive employees entitled to, but not yet receiving benefits 0 Total 97
C. Contributions
The contribution requirements of plan members and the City are established and may be amended by the City Council, and/or the employee associations The City is currently funding this OPEB obligation based on a pay-asyou-go basis. For the measurement date ended June 30, 2022, the City made no contributions to the plan, which would be recognized as a reduction of the total OPEB liability.