Los Alamitos City Council
November 20, 2023

NOTICE TO THE PUBLIC – This Agenda contains a brief general description of each item to be considered. Except as provided by law, action or discussion shall not be taken on any item not appearing on the agenda. Supporting documents, including staff reports, are available for review at City Hall in the City Clerk’s Office or on the City’s website at www.cityoflosalamitos.org once the agenda has been publicly posted.

Each matter on the agenda, no matter how described, shall be deemed to include any appropriate motion, whether to adopt a minute motion, resolution, payment of any bill, approval of any matter or action, or any other action. Items listed as “for information” or “for discussion” may also be the subject of an “action” taken by the City Council at the same meeting.

Agenda-related documents provided to a majority of the City Council after distribution of the City Council agenda packet (GC §54957.5) will be made available for public inspection at the meeting. Such documents will also be available at the City Clerk's office, 3191 Katella Ave., Los Alamitos, CA 90720.

In compliance with the Americans with Disabilities Act, Assistive Listening headphones are available and can be checked out from the City Clerk. If you need special assistance to participate in this meeting, please contact the City Clerk at (562) 431-3538, ext. 220. Notification at least 42 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting. [28 CFR 35.102.35.104 ADA Title II]. Language translation services are available for this meeting by calling the City Clerk’s Office least 42 hours in advance If you are unable to attend this meeting in person, you may submit comments on any agenda item or on any item not on the agenda by email to [email protected] with the subject line “COUNCIL PUBLIC COMMENT”. Comments received by 3:00 p.m. they day of the meeting will be compiled, provided to the City Council, and made available to the public before the start of the meeting. Staff will not read email comments at the meeting. You may also view the meeting live on local cable channel 3.

If, as an attendee, or a participant at this meeting, you will need special assistance beyond what is normally provided, please contact the City Clerk’s Office at (562) 431-3538, extension 220, 48 hours prior to the meeting so that reasonable arrangements may be made.

CITY OF LOS ALAMITOS
Council Chamber
3191 Katella Ave., Los Alamitos CA 90720

CITY COUNCIL AGENDA

REGULAR MEETING
Monday, November 20, 2023 – 5:30 PM

1. CALL TO ORDER

2. ROLL CALL
Mayor Doby
Mayor Pro Tem Nefulda
Council Member Hasselbrink
Council Member Hibard
Council Member Murphy

3. PLEDGE OF ALLEGIANCE
Mayor Doby will lead the Pledge of Allegiance.

4. INVOCATION
Mayor Pro Tem Nefulda will give the Invocation.

5. CLOSED SESSION
A. CONFERENCE WITH LABOR NEGOTIATOR
City Negotiator: Chet Simmons, City Manager
Employee Organization: Los Alamitos Police Officers Association Authority: Government Code Section 54957.6
B. CONFERENCE WITH LABOR NEGOTIATOR
City Negotiator: Chet Simmons, City Manager
Employee Organization: Teamsters Local 911
Authority: Government Code Section 54957.6
C. CONFERENCE WITH LABOR NEGOTIATOR
City Negotiator: Chet Simmons, City Manager
Employee Organization: Executive Management, Non-Represented Authority: Government Code Section 54957.6

6. PRESENTATIONS
A. Presentation of a Proclamation to Jamie Tran and Cynthia Sanchez in Recognition of Nurse Practitioner’s Month
B. Presentation of a Proclamation to Joseph Luck and Nathan Peak, Co- Owners of Lucky Peak's Barbershop, in Recognition of Small Business Saturday
C. Presentation of a Certificate to Joseph Luck and Nathan Peak, CoOwners of Lucky Peak's Barbershop, in Recognition of Being Featured in the Mayor's Business Spotlight

7. ORAL COMMUNICATIONS
At this time, any individual in the audience may come forward to speak on any item within the subject matter jurisdiction of the City Council. Remarks are to be limited to not more than five minutes per speaker.

8. UPDATES FROM THE MAYOR
At this time, the Mayor may report on items not specifically described on the Agenda that are of interest to the community, provided no action or discussion is taken.

9. UPDATES FROM THE CITY STAFF
At this time, City Staff may also report on items not specifically described on the Agenda that are of interest to the community, provided no action or discussion is taken except.

10. WARRANTS
A. Warrants (Finance)
The attached Warrant Register contains checks and electronic funds transfers for the period from October 1, 2023 to October 31, 2023.

Recommendation: Ratify the Warrants for the period from October 1, 2023, to October 31, 2023, in the amount of $1,715,347.37.

Roll Call
Mayor Doby
Mayor Pro Tem Nefulda
Council Member Hasselbrink
Council Member Hibard
Council Member Murphy

11. CONSENT CALENDAR
All Consent Calendar items may be acted upon by one motion unless a Council Member requests separate action on a specific item.

A. Approval of Minutes
Approve the City Council Special Meeting Minutes of October 23, 2023.

B. Ordinance No. 2023-04 - Purchasing Policy (Finance)
This report provides information in connection with the City’s current purchasing policy as codified in Chapter 2.60 (Purchasing System) of the Los Alamitos Municipal Code, and consideration of modifications. Ordinance No. 2023-04 was introduced, read by title only, further readings waived and set for adoption at the August 21, 2023, Council meeting.

Recommendation: Adopt Ordinance No. 2023-04 entitled “AN ORDINANCE

OF THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA, AMENDING AND RESTATING CHAPTER 2.60 (PURCHASING SYSTEM) OF THE LOS ALAMITOS MUNICIPAL CODE”.

C. Update on City's Credit Rating (Finance)
This report will provide an update regarding the City's Credit Rating.

Recommendation: Receive and file the update on the City’s Credit rating.

D. Amendment to City's Authorized Check Signers (Finance) This report provides the Council with an update of the City’s authorized check signers.

Recommendation: Authorize the City Manager to add the City Treasurer as a check signer and to remove the City Clerk.

E. PERS Trust Analysis (Finance)
Since adopting the City’s Fiscal Sustainability Plan, the Budget Standing Committee and the Los Alamitos City Council have been exploring different methods of maximizing investment opportunities that result in net savings for the City’s residents. Following 18 months of work with the Budget Standing Committee, a funding plan and policy was presented to the Council at the November 14, 2022, meeting, culminating in the adoption of Resolution 2022-33, PERS Unfunded Accrued Liability Pay-Down Funding Policy. This report provides the Council with a follow-up discussion on the PERS Unfunded Actuarial Liability (UAL) and consideration of possible additional funding analysis. The Budget Standing Committee discussed and recommend Council approval at its November 6, 2023, Special meeting.

Recommendation: Authorize the City Treasurer to initiate funding the City's Section 115 Trust with PARS for $50,000 monthly installments to accelerate paying down the PERS Unfunded Liability.

F. Resolution No. 2023-26 - Minimum Hourly Wage Increase Effective January 1, 2024 (Finance)
This report addresses the state-wide minimum wage increase that becomes effective January 1, 2024.

Recommendation: Adopt Resolution No. 2023-26, entitled, “A

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS,

CALIFORNIA, AMENDING AND RESTATING THE HOURLY RATE
SCHEDULE EFFECTIVE JANUARY 1, 2024 AND REPEALING EXHIBIT B FROM RESOLUTION NO. 2022-31.”
G. Investment Policy Update (Finance)
This report provides the Council with an update on the City’s Investment Policy and recommends amendments for allowable investments per the State Government Code.

Recommendation: Adopt Resolution No. 2023-25, entitled "A RESOLUTION

OF THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA,

ADOPTING THE STATEMENT OF INVESTMENT POLICY DATED
NOVEMBER 2023."
H. Resolution No. 2023-24 - Adopting the June 30, 2023 Measure M2 Expenditure Report (Finance)
Each agency that receives Measure M2 funds is required by the Orange County Transportation Authority to adopt an annual Expenditure Report to account for the use of Measure M2 funds.

Adopt Resolution No. 2023-24, entitled "A RESOLUTION OF THE CITY

COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA,

CONCERNING THE MEASURE M2 EXPENDITURE REPORT FOR THE
CITY OF LOS ALAMITOS FOR THE FISCAL YEAR ENDING JUNE 30, 2023."
I. Five-Year Contract with Flock Group, LLC (Police)
The Police Department seeks authorization to extend the contract for the Automated License Plate Reader (ALPR) program for an additional five years, expiring December 31, 2028.

Recommendation: Enter into a five-year Master Service Agreement with Flock Group, Inc. to lease twelve Automated License Plate Readers for a contract cost of $168,000.

J. Annual Military Equipment Report(Police)
Assembly Bill 481 requires City Council approval of an Annual Military Equipment Report.

Recommendation: Approve the Annual Military Equipment Report per Assembly Bill No. 481.

K. Approval of Plans and Specifications and Authorization to Rebid for the Bloomfield Neighborhood Street Rehabilitation Project (CIP No. 22/23-06) (Development Services)
The City of Los Alamitos is being provided $200,000 in federal Coronavirus Response and Relief Supplemental Appropriations Act of 2021 (CRRSAA) funding through the 2021 Pavement Management Relief Funding (PMRF) Program. This item seeks approval to facilitate the solicitation of bids to begin the Bloomfield Street Rehabilitation Project (22/23-06). The City rejected initial construction bids that were publicly opened for the project on September 07, 2023. Five proposals were received, and the submitted bids surpassed the allocated budget.

Recommendation:

1. Approve the plans and specifications for the Bloomfield Street Rehabilitation Project (22/23-06); and,

2. Authorize Staff to advertise and solicit bid proposals.

L. Award of Plans and Specifications for the Demolition of Los Alamitos Television Production (LATV) Building at 10921 Oak Street Project (CIP No. 22/23-04) (Development Services)
This item recommends awarding a bid to begin the demolition of the Los Alamitos Television (LATV)/Public Works (PW) Building at 10921 Oak Street Project (CIP No. 22/23-04).

Recommendation:

1. Award construction for the LATV/PW Building at 10921 Oak Street Project (CIP No. 22/23-04) in the amount of $104,671.00 to Unlimited Environmental, Inc.; and,

2. Authorize the Mayor to execute the contract with Unlimited Environmental, Inc. for the LATV/PW Building at 10921 Oak Street Project (CIP No. 22/23-04); and

3. Authorize the City Engineer to add work and execute change orders in an amount not to exceed the contingency reserve of 20% or $20,935.00.

M. Amendment No. 3 with North Star Land Care for Annual Park and Landscape Maintenance Services (citywide) (Development Services) This item seeks approval of Amendment No. 3 with North Star for annual citywide park and landscape maintenance services for the amount of $114,067.92.

Recommendation: Authorize the Mayor to execute Amendment No. 3 to the Professional Services Agreement with North Star Land Care for a one (1) year term for annual park and landscape maintenance services citywide through January 19, 2025, for a total amount of $114,067.92.

N. Amendment No. 10 with Clear Channel Outdoor, LLC for Bus Shelter License and Maintenance Agreement (Development Services) This item seeks approval of Amendment No. 10 with Clear Channel Outdoor, LLC to continue providing Bus Shelter License and Maintenance Services until November 20, 2024. The current Professional Services Agreement (PSA) expires on December 31, 2023.

Recommendation: Authorize the Mayor to execute Amendment No. 10 of the Professional Services Agreement with Clear Channel Outdoor, LLC, with no fiscal impact and a term expiring on November 24, 2024.

O. Resolution No. 2023-27 - Federal Transportation Improvement Program (FTIP) (Development Services)
Orange County Transportation Authority (OCTA) has requested the adoption of Resolution 2023-27 to affirm the City’s commitment to the projects submitted in the 2025 Federal Transportation Improvement Program (FTIP).

Recommendation: Adopt Resolution No. 2023-27, entitled, “A RESOLUTION

OF THE CITY OF LOS ALAMITOS, CALIFORNIA, WHICH CERTIFIES

THAT LOS ALAMITOS HAS THE RESOURCES TO FUND THE
PROJECTS IN THE FISCAL YEAR 2024/25 – 2029/30 TRANSPORTATION

IMPROVEMENT PROGRAM AND AFFIRMS ITS COMMITMENT TO
IMPLEMENT ALL PROJECTS IN THE PROGRAM".

12. PUBLIC HEARING
A. Quimby In-Lieu Fees (Development Services)
Discussion of a proposed update to the Park In-Lieu Fees Pursuant to the Quimby Act Fees as studied through the 2023 City of Los Alamitos’ Quimby Land Dedication and In-Lieu Fee Study.

Recommendation:

1. Open the Public Hearing; and

2. Consider the draft ordinance and resolution: and, if appropriate,

3. Introduce for first reading, read by title only, and waive further reading of Ordinance No. 2023-05; and,

4. City Attorney Daudt read the title of Ordinance No. 2023-05 entitled, “AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LOS
ALAMITOS, CALIFORNIA, AMENDING SECTIONS 16.18.040
AND 16.18.080 OF CHAPTER 16.18 (DEDICATION OF LAND

FOR PARK FACILITIES AND PAYMENT OF IN- LIEU FEES) OF
TITLE 16 (SUBDIVISIONS) OF THE LOS ALAMITOS MUNICIPAL

CODE PURSUANT TO THE QUIMBY ACT, CALIFORNIA
GOVERNMENT CODE SECTION 66477 (CITY INITIATED).”

5. Adopt Resolution No. 2023-29, entitled, “A RESOLUTION OF THE

CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA,

APPROVING UPDATED PARKLAND DEDICATION AND IN-LIEU

FEES THAT MAY BE REQUIRED IN CONNECTION WITH THE

APPROVAL OF NEW RESIDENTIAL SUBDIVISIONS PURSUANT

TO THE QUIMBY ACT, CALIFORNIA GOVERNMENT CODE
66477 IN FULFILLMENT OF TITLE 16 (SUBDIVISIONS),
CHAPTER 16.18 (DEDICATION OF LAND FOR PARK FACILITIES

AND PAYMENT OF IN-LIEU FEES) OF THE LOS ALAMITOS
MUNICIPAL CODE.”

13. DISCUSSION ITEM
A. Administrative Rules and Regulations Update; Discretionary Designations & Collateral Duty Assignments (Administration) The Administrative Rules and Regulations (ARs) are an accumulation of policies that were adopted by Council, approved by the City Manager, and/or are administered by the Departments. This report requests

amending and restating Administrative Rule 4.10 City Manager Discretionary Designations and Collateral Duty Assignments.

Recommendation:

1. Amend and Restate Administrative Regulation 4.10 – Deputy City Manager Designation that was adopted by Council action on February 1, 2023; and,

2. Authorize the City Manager to implement and modify as needed, Administrative
B. Resolution No. 2023-28 – Awarding the City Manager a Performance Based Incentive Bonus for Calendar Year 2023 (Administration) The City Council evaluated the City Manager’s performance during closed session on October 23, 2023. Pursuant to the City Manager’s Employment Agreement, the City Manager may be entitled to up to a two percent (2%) annual performance based incentive bonus, which may be awarded at the sole discretion of the City Council.

Recommendation:

1. Pursuant to California Government Code section 54953(c)(3), an oral report summarizing the recommendation must be made in open session prior to the City Council taking final action on this item.

2. Adopt Resolution No. 2023-28, entitled, “A RESOLUTION OF THE

CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA,

AWARDING THE CITY MANAGER A PERFORMANCE BASED
INCENTIVE BONUS FOR CALENDAR YEAR 2023”.

14. COUNCIL ANNOUNCEMENTS
At this time, Council Members may also report on items not specifically described on the Agenda that are of interest to the community, provided no action or discussion is taken except to provide Staff direction to report back or to place the item on a future Agenda.

15. ADJOURNMENT
I hereby certify under penalty of perjury under the laws of the State of California, that the foregoing Agenda was posted at the Los Alamitos City Hall, 3191 Katella Ave. and online at www.cityoflosalamitos.org not less than 72 hours prior to the meeting.

Windmera Quintanar, MMC, City Clerk
Dated: November 15, 2023

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 10A
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: Warrants

SUMMARY
The attached Warrant Register contains checks and electronic funds transfers for the period from October 1, 2023 to October 31, 2023.

RECOMMENDATION
Ratify the Warrants for the period from October 1, 2023, to October 31, 2023, in the amount of $1,715,347.37.

BACKGROUND
The expenditures noted within this Warrant Register conform to the budget approved by the City Council.

DISCUSSION
The Director of Finance certifies the accuracy of the attached register and the availability of monies for payment thereof.

FISCAL IMPACT
The grand total of $1,715,347.37 represents checks and electronic fund transfers for the period October 1, 2023 to October 31, 2023.

Attachment: 1. Warrants 11-20-23

MINUTES OF THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS

SPECIAL MEETING
Monday, October 23, 2023

1. CALL TO ORDER
The City Council met in Special Session at 5:30 p.m., Monday, October 23, 2023, in the Council Chamber located at 3191 Katella Ave., Los Alamitos, CA 90720, Mayor Doby presiding.

2. ROLL CALL

Present: Council Members: Hasselbrink, Hibard, Murphy
Mayor Pro Tem Nefulda, Mayor Doby

Absent: Council Members: None

Present: Staff: Chet Simmons, City Manager
Michael Claborn, Chief of Police
Michael Daudt, City Attorney
Eleanor Granflor, Deputy City Clerk
Craig Koehler, Finance Director
Irving Montenegro Jr., Development Services Manager
Emeline Noda, Recreation and Community Services Director Ron Noda, Development Services Director
Windmera Quintanar, MMC, City Clerk
Chelsi Wilson, Administrative Services Manager

3. CLOSED SESSION
City Attorney Daudt read the item aloud.

A. PUBLIC EMPLOYEE PERFORMANCE EVALUATION
Title: City Manager
Authority: Government Code Section 54957
B. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION Significant exposure to litigation pursuant to Cal. Gov. Code § 54956.9(d)(2):
(Claim No. 0057769)
C. CONFERENCE WITH LABOR NEGOTIATOR
City Negotiator: Chet Simmons, City Manager
Employee Organization: Los Alamitos Police Officers Association Authority: Government Code Section 54957.6

City Council Special Minutes
October 23, 2023

D. CONFERENCE WITH LABOR NEGOTIATOR
City Negotiator: Chet Simmons, City Manager
Employee Organization: Teamsters Local 911
Authority: Government Code Section 54957.6
E. CONFERENCE WITH LABOR NEGOTIATOR
City Negotiator: Chet Simmons, City Manager
Employee Organization: Executive Management, Non-Represented Authority: Government Code Section 54957.6
RECESS
The City Council recessed into Closed Session at 5:30 p.m.

RECONVENE
The City Council reconvened in Regular Session at 6:14 p.m.

City Attorney Daudt stated there was no reportable action.

4. PLEDGE OF ALLEGIANCE
Council Member Murphy led the Pledge of Allegiance.

5. INVOCATION
Mayor Doby gave the Invocation.

6. PRESENTATIONS
Mayor Doby and the City Council presented the listed items. Item 6B was presented last.

A. Presentation of a Tile Plaque to Trini Zenovka for Her Service to the City of Los Alamitos
B. Presentation by Lora Young, Orange County Mosquito and Vector Control District, Regarding Vector and Vector-Borne Disease in Orange County
Ms. Young gave a PowerPoint presentation.

C. Presentation of a Certificate to Debbie Jackobs, Owner of Flags with a Flair, in Recognition of Being Featured in the Mayor's Business Spotlight
D. Presentation of a Commendation to the Los Alamitos Code Enforcement Staff in Recognition of Code Enforcement Appreciation Month

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October 23, 2023

7. ORAL COMMUNICATIONS
At this time, any individual in the audience may come forward to speak on any item within the subject matter jurisdiction of the City Council. Remarks are to be limited to not more than five minutes per speaker.\
Mayor Doby opened Oral Communications.

Sallie Rodman, resident, spoke regarding the rodent infestation in her neighborhood due to the solar project at the Joint Forces Training Base.

Mayor Doby closed Oral Communications.

8. UPDATES FROM THE MAYOR
At this time, the Mayor may report on items not specifically described on the Agenda that are of interest to the community, provided no action or discussion is taken.

Mayor Doby advised of the upcoming Good Evening, Los Alamitos! Event on November 16, 2023.

9. UPDATES FROM THE CITY STAFF
At this time, City Staff may also report on items not specifically described on the Agenda that are of interest to the community, provided no action or discussion is taken except.

Police Chief Claborn provided an update regarding the canine program.

Finance Director Koehler gave an overview of accrued interest on investments over the last quarter.

10. WARRANTS
A. Warrants (Finance)
The attached Warrant Register contains checks and electronic fund transfers for the period September 1, 2023 to September 30, 2023.

Council Member Hibard and Council Member Murphy Council Member asked questions regarding several charges and received answers from Staff.

City Manager Simmons explained the history of the City Council supply budget and advised a reallocation to a new budget account could occur at Council’s direction to help provide clarification on expenses.

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October 23, 2023

Motion/Second: Hasselbrink/Nefulda
Unanimously Carried: The City Council ratified the Warrants for the period from September 1, 2023 to September 30, 2023 in the amount of $2,026,800.64.

Roll Call
Mayor Doby Aye
Mayor Pro Tem Nefulda Aye
Council Member Hasselbrink Aye
Council Member Hibard Aye
Council Member Murphy Aye

11. CONSENT CALENDAR
All Consent Calendar items may be acted upon by one motion unless a Council Member requests separate action on a specific item.

Council Member Murphy had questions regarding item 11B.

Council Member Hibard had questions regarding items 11A, 11D, and 11E.

Motion/Second: Nefulda/Hibard
Unanimously Carried: The City Council approved the following Consent Calendar items:

A. Approval of Minutes (Administration)
Approved the Regular Meeting Minutes of September 18, 2023.

Council Member Hibard requested the vote on page 6 be corrected to reflect she had voted no and Murphy had abstained.

B. Treasurer's Quarterly Investment Report - September 2023 (Finance) The item for City Council consideration was receipt of the Treasurer’s Quarterly Investment Report.

Council Member Murphy asked questions regarding the investment holdings and requested a list of brokers.

The City Council received and filed the Treasurer’s Quarterly Investment Report – September, 2023.

C. Crossing Guard Services with All City Management, Inc. (Police) The City of Los Alamitos has outsourced crossing guard services to All City Management Services, Inc. (ACMS) since FY 2016-2017. ACMS has successfully and effectively provided crossing-guard services since that time. The contract between the City and ACMS has exhausted all allowed extensions to date, and staff is supportive of continuing this relationship for

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October 23, 2023

crossing guard services. This item proposes entering a new agreement with ACMS for the contained provision of crossing guard services.

The City Council:

1. Authorized the City Manager to enter into the Crossing Guard Services Agreement between All Cities Management and the City of Los Alamitos for the term of July 1, 2023 through June 30, 2025; and,

2. Allocated an additional $30,500 to the Police Department account 10- 528-5260, for Crossing Guard Services.

D. Approval of the Request for Proposals (RFP) 2023-06 and Authorization to Bid for an Armored Rescue and Response Vehicle (Police) This item facilitated the solicitation of bids for the purchase of an armored rescue and response vehicle.

Council Member Hibard questioned why Los Alamitos would need to acquire an armored vehicle. Chief Claborn referred to the information contained in the Staff report and provided a response.

The City Council:

1. Approved the Request for Proposals (RFP) 2023-06 Armored Rescue and Response vehicle; and,

2. Authorized Staff to advertise and solicit bid proposals.

E. Award of Bid for Concrete Remediation (CIP 22/23-08) (Development Services)
This item recommended awarding a two-year contract to Southern California Precision Cutting Inc. to conduct a citywide sidewalk assessment and provide “On-Call” remediation services of sidewalk trip hazards with a lift of one-quarter inch to two inches in an amount not to exceed $200,000.

Council Member Hibard referred to the Highlands and inquired about the City’s current concrete replacement expenses. City Manager Simmons and Development Services Director Noda clarified the first step of this contract would be to provide an assessment to identify areas that need to be repaired.

Depending on the scope of the repair Precision Cutting would shave the concrete or Staff would coordinate the complete removal and replacement.

The City Council:

1. Awarded the bid for the on-call sidewalk assessment and remediation of concrete sidewalk trip hazards (CIP 22/23-08) in the amount not to

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October 23, 2023

exceed $200,000 for two years to Southern California Precision Cutting Inc.; and,

2. Authorized the Mayor to execute the contract with Southern California Precision Cutting Inc. for the project.

F. Community Development Block Grant (CDBG) Application Resolution for Fiscal Year 2024/2025 (Development Services)
This item recommended adoption of a Resolution of approval for the Fiscal Year 2024/2025 Community Development Block Grant (CDBG) project application with the County of Orange.

The City Council adopted Resolution No. 2023-22, entitled “A RESOLUTION

OF THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA APPROVING THE CITY’S PARTICIPATION IN THE FISCAL YEAR
2024/2025 COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG)
PROGRAM WITH THE COUNTY OF ORANGE.”
G. Reject Bid for the Bloomfield Neighborhood Street Rehabilitation Project (CIP No. 22/23-06) (Development Services)
Construction bids were publicly opened for the Bloomfield Neighborhood Street Rehabilitation Project (CIP No. 22/23-06) on September 7, 2023 with five bids received. The submitted acceptable bids surpassed a feasible budget. Therefore, staff is recommending that Council reject the bid submitted and go back out for additional bids.

The City Council rejected all bids received for the Bloomfield Neighborhood Street Rehabilitation Project (CIP No. 22/23-06).

H. Purchase of one (1) 2024 Ford Super Duty F-550 Stakebed Truck via the Sourcewell Competitive Purchasing Program from National Auto Fleet Group Contract No. 091521-NAF (Development Services)
This item sought approval to purchase one (1) 2024 Ford Super Duty F-550 Stakebed Truck via the Sourcewell Competitive Purchasing Program at a cost of $83,524.46.

The City Council approved the purchase of one (1) 2024 Ford Super Duty F550 DRW Stakebed Truck from National Auto Fleet Group via Sourcewell Contract No. 091521-NAF for an amount not to exceed $83,524.46.

I. Disposal of Surplus Equipment (City Fleet and Equipment) (Development Services)
This item set forth a recommendation to dispose of surplus equipment and a fleet vehicle valued between $8,975 - $17,175.

The City Council declared the listed equipment and fleet as surplus and

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October 23, 2023

authorize its disposal in accordance with Los Alamitos Municipal Code (LAMC), Section 2.60.020.

12. DISCUSSION ITEM
A. Projects of Significance Update - MyLosAlEngage (Administration) This Item provided an update on automation processes related to enhancing the City’s notification efforts related to projects of significance in the City.

City Manager Simmons summarized the staff report, referring to the information contained therein and answered questions from the City Council.

Council Member Hibard questioned if this platform would replace the Friday eNewsletter and if notification could be segmented by district.

City Manager Simmons advised it would not replace the eNewsletter and that Staff is currently exploring all capabilities.

Motion/Second: Hasselbrink/Hibard
Unanimously Carried: The City Council received and filed.

B. Consideration of an Accelerated Warrant Report Policy (Finance) This report provides information in connection with a proposed acceleration of the Warrant Report Policy.

City Manager Simmons summarized the staff report, referring to the information contained therein and answered questions from the City Council.

Council Member Hibard asked if this report would have more detailed information and a copy of the invoice. City Manager Simmons stated no and indicated the intent was to allow Council to ask questions and allow staff time to provide the answers.

Motion/Second: Nefulda/Hasselbrink
Unanimously Carried: The City Council approved the proposed accelerated distribution of the Warrant Register.

C. Resolution to Express Support for Actions to Retain Local Control Related to Local Zoning and Housing Issues (Administration) This agenda item provides information on SB 9 which allows homeowners to create up to four homes on an existing parcel, in effect, eliminating singlefamily-only zoning. The item includes information on the charter cities of Carson, Del Mar, Redondo Beach, Torrance, and Whittier (Petitioner Cities) and their day in court arguing against the State of California on the constitutionality of SB 9.

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October 23, 2023

City Manager Simmons summarized the staff report, referring to the information contained therein.

Motion/Second: Hibard/Nefulda
Unanimously Carried: The City Council supported retaining local control by adopting Resolution No. 2023-23, entitled, "A RESOLUTION OF CITY

COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA, EXPRESSING

SUPPORT FOR ACTIONS TO FURTHER STRENGTHEN LOCAL

DEMOCRACY, AUTHORITY, AND CONTROL AS RELATED TO LOCAL
ZONING AND HOUSING ISSUES".

D. Los Alamitos Community Foundation and City of Los Alamitos Memorandum of Understanding (MOU), Los Alamitos Senior Club and City of Los Alamitos Agreement, Los Alamitos Museum Insurance (Recreation)
This agenda item provides draft Memorandum of Understandings (MOU) between the Los Alamitos Community Foundation and the City of Los Alamitos and the Agreement between the Los Alamitos Senior Club and the City of Los Alamitos. This item also addresses the reimbursement cost of insurance for both organizations, including the Los Alamitos Museum.

City Manager Simmons summarized the staff report, referring to the information contained therein and answered questions from the City Council.

Council and Staff discussed the following:
• The type of insurance currently carried by the Los Alamitos Community Foundation (LACF)
• MOUs would clarify the obligations of each entity and ensure adequate coverage
• LACF obtained a separate insurance policy for the sale of fireworks • 501(c)3 status of all three city established entities • Liability at events and ensuring there is no lapse in coverage • Insurance coverage would be paid outright
• LACF sole purpose is to generate money for city and provides a direct benefit back to the City
• Senior Club provides volunteers to staff programming the City could not Staff otherwise
Motion/Second: Murphy/Hibard
Unanimously Carried: The City Council:

1. Reviewed and discussed the Memorandum of Understanding (MOU) with the Los Alamitos Community Foundation and the Agreement with the Los Alamitos Senior Club; and,

City Council Special Minutes
October 23, 2023

2. Authorized the Mayor to execute the Memorandum of Understanding with the Los Alamitos Community Foundation; and,

3. Authorized the Mayor to execute the Agreement with the Los Alamitos Senior Club; and,

4. Approved covering the cost of insurance for the Los Alamitos Community Foundation, Los Alamitos Senior Club, and Los Alamitos Museum.

E. Senior Services Master Plan (Recreation)
This item for Council consideration is the concept of a Senior Services Master Plan to serve as a framework for future programming and infrastructure needs to serve the older adult community in Los Alamitos for the next 20 years.

Recreation and Community Services Director Noda summarized the staff report, referring to the information contained therein and answered questions from the City Council.

Council and Staff discussed the following:
• Adoption of Master Plan allows the City to access additional funding sources and invest in the City’s future
• Allows the City to properly serve the largest growing segment of our population
• Would allow the City to be one of the first cities to adopt a Senior Services Master Plan
• 20-year plan would allow for the consideration of aging infrastructure • Interest for having resources and actives available to all different age and health groups of seniors
• Interest in providing services to keep the community together even when elderly neighbors have to move to assisted care facilities • Interest in providing support for Alzheimer and Dementia Motion/Second: Hasselbrink/Murphy
Unanimously Carried: The City Council:

1. Discussed the need and desire for a Senior Services Master Plan; and,

2. Directed Staff to proceed with facilitating a Senior Services Master plan; and,

3. Supported appropriating funds out of General Fund Reserves for the Senior Services Master Plan.

City Council Special Minutes
October 23, 2023

F. Staffing Recommendations (Administration)
This item proposed the conversion of three part-time Community Services Coordinators to full-time Recreation Coordinators in the Recreation & Community Services Department and a new full-time Department Secretary for Administration at Mid-Year. If the proposed plan of conversion from parttime to full-time occurs at Mid-Year, the fiscal impact to the Recreation & Community Services Department will be $67,054. Annually, the fiscal impact will be approximately $134,108. The cost for the Department Secretary for Administration will be at Mid-Year is $58,047 and the annual fiscal impact is $116,095.

City Manager Simmons summarized the staff report, referring to the information contained therein and answered questions from the City Council.

Council and Staff discussed the complete fiscal impact each position was listed; clarification regarding creative writing and video production requirement; and, differing skills and job sets were needed for a Clerical Assistant and Department Secretary.

Motion/Second: Hasselbrink/Doby
Unanimously Carried: The City Council reviewed, discussed, and approved the proposal to convert three part-time Community Services Coordinators to full-time Coordinators and adding a new Department Secretary for Administration at Mid-Year.

G. Consideration to Implement "Revive Los Alamitos" (Development Services)
A discussion concerning the implementation of an Economic Development program intended to financially assist Los Alamitos-based businesses and commercial establishments by investing in their property through various methods.

Development Services Manager Montenegro summarized the Staff report referring to the information contained there and gave a PowerPoint Presentation.

City Council and Staff discussed the following:
• Façade improvement program working as a catalyst to get businesses to invest in their property
• Interest in incentives for blocks of businesses that participate • Concern that property owners would use the façade improvements to raise rent
• Goal to build relationships between the City, property owners, and business owners
• Program would follow existing regulations within the Los Alamitos

City Council Special Minutes
October 23, 2023

Municipal Code
• Possibility of establishing a city-wide look in the future • Interest in providing tax advise to property owners
• Non-profit organizations are required to obtain a no fee business license Motion/Second: Hasselbrink/Nefulda
Unanimously Carried: The City Council:

1. Reviewed and discussed the program structure and criteria; and,

2. Provided feedback; and,

3. Approved funding for the program at a cost of $105,000.

H. Community Center Roof Project (Development Services) The roof of the Community Center building has incurred significant damage from storms in the beginning of 2023. This item recommends actions to begin facilitating the repairs of the roof and damaged infrastructure.

Development Services Director Noda summarized the Staff report referring to the information contained therein and provided a PowerPoint presentation.

Council and Staff discussed the following:
• The difference between a roof repair and a roof replacement • Potential State grant funding due to the state of emergency at the time • Grant funding could be received at 12 months and 18 months • If grant funding is not successful, funding could be pursued through insurance
• Community Center roof would remain flat do to structural limitations • Overview of the issues with current roof and pooling effects at the drain pipe
Motion/Second: Hasselbrink/Nefulda
Unanimously Carried: The City Council:

1. Approved the Carryover the $500,000 for the Community Center Roof Project approved by Council at the March 20, 2023, Council Meeting; and,

2. Appropriated an additional $1,290,952 from the General fund for the Community Center Roof Project; and,

3. Authorized the City Manager to execute a construction contract for the Community Center Roof Project, in a form to be approved by the City Attorney, in amount not to exceed $1,790,952.

City Council Special Minutes
October 23, 2023

I. Award Sterns Park Playground and Fitness Equipment Purchase (Development Services)
This item was for the purchase of playground and fitness equipment directly from the manufacturer, GameTime, through the use of a cooperative purchasing agreement via OMNIA Partners. The purchase of the playground and fitness equipment is part of the Sterns Park Rehab Project and would enable greater cost savings and assurance that the project continues forward on its intended timeline.

Development Services Director Noda introduced the item and consultant Charles Foley with Hirsh and Associates.

Development Services Manager Montenegro summarized the Staff report referring to the information contained there and gave a PowerPoint Presentation.

Council and Staff discussed the following the estimated timeline for the project, the all-inclusive park redesign, and the benefits of utilizing a rubber surface.

Motion/Second: Hasselbrink/Nefulda
Unanimously Carried: The City Council:

1. Reviewed and discussed the proposal and purchasing agreement for GameTime playground and fitness equipment; and,

2. Authorized the City Manager to use a cooperative purchasing agreement, in a form approved by the City Attorney, for the playground and fitness equipment in the amount of $239,899,85.

13. COUNCIL ANNOUNCEMENTS
At this time, Council Members may also report on items not specifically described on the Agenda that are of interest to the community, provided no action or discussion is taken except to provide Staff direction to report back or to place the item on a future Agenda.

Council Member Hibard spoke regarding attendance at the following: Regional Military Affairs Committee (RMAC); Pacific Air Show; Chamber of Commerce Breakfast; Orange County Tax Legislative Update; Cypress Prayer Breakfast; and, Cypress State of the City.

Council Member Murphy spoke regarding attendance at the following: Food Finder Farm to Tableau Event; hosted College Park Safety Meeting; Yorba Linda State of the City; Trunk or Treat; and Taste of Los Al.

City Council Special Minutes
October 23, 2023

Council Member Hasselbrink spoke regarding attendance at the following: Pilot Welcome at the Joint Forces Training Base; Pacific Air show; Tast of Los Al; Los Alamitos Elevate Women’s Conference; and, Trunk or Treat. She requested the meeting be adjourned in honor of Rob Lowenberg.

Mayor Pro Tem Nefulda spoke regarding attendance at the following: Pacific Air Show; Chamber Breakfast; Orange County Sanitation District Board and Committee Meetings; and the Working Group meeting with the Los Alamitos Unified School District.

Mayor Doby spoke regarding attendance at the following: League of California Cities Annual Conference; Pilot Welcome at the Joint Forces Training Base; Youth Center Crystal Hearts Ball; filming at Flags with a Flair for the Business Spotlight; State of the District; Chamber Breakfast, Los Alamitos Elevate Women’s Conference; Orange County Mosquito and Vector Control District Board Meeting; and, Trunk or Treat.

14. ADJOURNMENT
The City Council adjourned at 8:55 p.m. in memory of Rob Lowenberg, We Care.

Tanya Doby, Mayor
Attest:

Windmera Quintanar, MMC, City Clerk

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 11B
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: Ordinance No. 2023-04 - Purchasing Policy

SUMMARY
This report provides information in connection with the City’s current purchasing policy as codified in Chapter 2.60 (Purchasing System) of the Los Alamitos Municipal Code, and consideration of modifications. Ordinance No. 2023-04 was introduced, read by title only, further readings waived and set for adoption at the August 21, 2023, Council meeting.

RECOMMENDATION
Adopt Ordinance No. 2023-04 entitled “AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA, AMENDING AND RESTATING CHAPTER 2.60 (PURCHASING SYSTEM) OF THE LOS ALAMITOS MUNICIPAL CODE”.

BACKGROUND
The City’s procurement regulations, policies and procedures are codified at Chapter 2.60 (Purchasing System) of the Los Alamitos Municipal Code (the “Purchasing Ordinance”). The Purchasing Ordinance was last amended in 2021. City Staff recommends the proposed amendments to the Purchasing Ordinance based on its experience working with the existing code and following a review of purchasing regulations in surrounding jurisdictions. The proposed Ordinance is intended to streamline the procurement process and provide anticipated gains in efficiency.

DISCUSSION
The current purchasing policy approvals are defined in Chapter 2.60 of the Los Alamitos Municipal Code (the “Purchasing Ordinance”). The Purchasing Ordinance has been in place for many years and has provided guidance for purchasing decisions. As the City’s operations have expanded, so has the need to modify the Purchasing Ordinance to allow for more efficient operations. An updated Purchasing Ordinance was discussed with the Budget Standing Committee on May 9 and presented to the City Council on May 15. Incorporating the input from the Council, and upon further review by staff, additional refinements have been made to the proposed Purchasing Ordinance and were presented to Council on September 18.

If approved by the City Council, proposed Ordinance No. 2023-04, would amend LAMC § 2.60.

Below is a summary of the changes.

Defined Terms (Section 2.60.020)
The updated ordinance adds definitions for the terms “estimated value”, “non-professional

services”, “professional services” and “purchase order” to assist readers and aide in the administration of the chapter.

Scope of Purchasing Policies and Procedures (Section 2.60.030) The updated ordinance clarifies that Chapter 2.60 applies only to the purchase of supplies, equipment and services and not public works construction projects. Procedures and processes for the procurement of public works construction contracts are subject to the City Charter and the California Public Contract Code.

Delegation to Purchasing Agents (Section 2.60.050)
Under the existing ordinance, the City Manager is authorized to delegate any and all of his powers as the Purchasing Officer to any other City officer or employee. The updated ordinance refines this authorization. As updated, delegation may only be made to department heads.

Any such delegation must be made in writing by the Purchasing Officer and maintained on file with the Director of Finance.

Purchasing Authority – City Council (Section 2.60.060A) Purchases of supplies, equipment, and services with a contract value of more than one hundred thousand dollars ($100,000.00) shall be awarded by written contract approved by the City Council.

Purchasing Authority - City Manager (Section 2.60.060B) Under the existing ordinance, the City Manager’s approval authority is limited to purchases, and contracts for supplies, equipment and services up to $50,000. In many cases, contracts and services exceed this amount, and delays have occurred in engaging needed work in a timely manner. The proposed amendment would authorize the City Manager to approve purchases of supplies, equipment, and services with a contract value of up to one hundred thousand dollars ($100,000.00). As a control measure, the updated ordinance now requires the City Manager to promptly notify the Budget Standing Committee in writing of any purchase of more than $80,000. This control measure is repeated at Sections 2.60.090 (Informal Purchasing Procedures) and 2.60.150 (Professional Services).

Budget appropriation required for purchases (Section 2.60.070).

Except in cases of emergency, the City Manager shall not issue any purchase order or contract for supplies, equipment, or services unless there exists an unencumbered appropriation in the adopted budget against which such purchases may be charged.

Open Market Purchasing (Section 2.60.080)
Purchases of equipment, supplies, and non-professional services with an estimated value of up to ten thousand dollars ($10,000.00) may be made by the Purchasing Officer in the open market. Purchase Orders are required for purchases over two thousand five hundred dollars ($2,500). The existing threshold is $5,000 for such purchases.

Informal Purchasing Procedures (Section 2.60.090)
Purchases of equipment, supplies, and non-professional services with an estimated value of more than ten thousand dollars ($10,000.00) and up to one hundred thousand dollars ($100,000.00) shall be made following staff’s solicitation of at least three written proposals.

The existing threshold is $50,000 or less for such purchases.

Formal Purchasing Procedures (Section 2.60.100)
Purchases of equipment, supplies, and non-professional services with an estimated value of more than one hundred thousand dollars ($100,000.00) shall be made following the issuance of a publicly noticed request for proposals. Formal contracts must be awarded by the City Council. The existing threshold is more than $50,000 for such purchases.

Purchase orders required - Exception (Section 2.60.130) Purchases of supplies and equipment shall be made only by purchase order; provided, however, that any City department that maintains a City-issued credit card may make purchases with such credit card of less than two thousand five hundred dollars ($2,500.00).

The single transaction purchase of supplies and equipment is being changed from $1,500 to $2,500 to facilitate more efficiencies and control over credit card use.

Exceptions to Purchasing Procedure (Section 2.60.140)
The updated ordinance clarifies existing exceptions to the standard procurement procedures.

The informal and formal bidding procedures may be dispensed with for (1) Sole Source Procurements, (2) Proprietary Procurements, and (3) Emergency Purchases, and (4) Purchases through other Public Agencies. These exceptions are already codified in the existing ordinance; however, the updated ordinance adds language to better explain when the exceptions would apply. Further, with respect to Emergency Purchases, the updated ordinance requires the Purchasing Officer to promptly file with the City Council a report identifying the emergency conditions and the necessity for the purchase, together with an itemized account of all expenditures.

The proposed modifications to the Purchasing System will better align with the operating needs to result in increased efficiencies in workflow and more effective operations for the City.

FISCAL IMPACT
There is no direct, explicit fiscal impact to modifying the purchasing Ordinance. However, it is anticipated that the proposed Ordinance will result in administrative cost savings due to the increased efficiency arising from the increase in threshold amounts, City Manager contract authority, and streamlining of procurement processes.

Attachment: 1. Ordinance 2023-04 - Purchasing Policy

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ORDINANCE NO. 2023-04

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF

LOS ALAMITOS, CALIFORNIA, AMENDING AND
RESTATING CHAPTER 2.60 (PURCHASING SYSTEM) OF

THE LOS ALAMITOS MUNICIPAL CODE
WHEREAS, the City’s procurement regulations, policies and procedures are codified at Chapter 2.60 (Purchasing System) of the Los Alamitos Municipal Code (the “Purchasing Ordinance”); and,
WHEREAS, the Purchasing Ordinance was last amended in 2021; and, WHEREAS, the Purchasing Ordinance is outdated and hinders the City’s ability to quickly and efficiently address the needs of the City; and, WHEREAS, revisions to the Purchasing Ordinance are needed to adhere with best practices and be consistent with surrounding cities; and, WHEREAS, the proposed amendment and restatement of the Purchasing Ordinance will increase the monetary purchasing thresholds, improve efficiency and enhance City procurement of necessary supplies, equipment, and services.

THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA, DOES ORDAIN AS FOLLOWS:

SECTION 1. The foregoing recitals are true and correct.

SECTION 2. Section 2.60 of the Los Alamitos Municipal Code is hereby amended and restated to read as follows:

Chapter 2.60 PURCHASING SYSTEM

2.60.010 Purchasing system adopted.

2.60.020 Definitions.

2.60.030 Scope of purchasing policies and procedures.

2.60.040 Purchasing Officer.

2.60.050 Purchasing Agents.

2.60.060 Purchasing authority.

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2.60.070 Encumbrance of funds.

2.60.080 Open market purchasing.

2.60.090 Informal purchasing procedures.

2.60.100 Formal purchasing procedures.

2.60.110 Best qualified vendor.

2.60.120 Inspection and testing.

2.60.130 Purchase orders required – Exception.

2.60.140 Exceptions to purchasing procedure.

2.60.150 Professional services.

2.60.010 Purchasing system adopted.

In order to establish efficient procedures for the purchase of supplies, equipment, and services, to secure for the City supplies, equipment, and services at the lowest possible cost commensurate with the quality needed, to exercise positive financial control over purchases, to clearly define authority for the purchasing function and to ensure the quality of purchases, a purchasing system is hereby adopted.

2.60.020 Definitions.

For purposes of this chapter, the following definitions shall apply:

A. “Estimated value” the estimated total value as determined by the Purchasing Officer at the beginning of the procurement process for the proposed supplies, equipment, and services. When making this initial threshold determination, the Purchasing Officer shall make reasonable use of all available market data and pricing information to estimate the total cost to the City, inclusive of taxes, licenses, freight charges, installation charges, fees, and other consideration, for the proposed procurement. The Purchasing Officer shall not use the value of any anticipated exchange or trade-in amount to reduce the estimated value of the proposed procurement.

B. “Non-professional services” means a contract for services not constituting professional services or public works projects subject to the City Charter and the California Public Contract Code.

C. “Professional services” means a contract for services, other than services constituting public works projects, performed by specially trained persons or firms who provide services in connection with financial, economic, accounting, engineering,

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administrative or other matters involving specialized expertise or unique skills gained by formal studies or experience.

D. "Purchase order" means a written authorization by the issuing party for the recipient to provide labor, materials or services for which the issuing party agrees to pay.

2.60.030 Scope of purchasing policies and procedures.

Except as otherwise provided herein, the procurement regulations, policies, and procedures set forth in this chapter shall apply only to the purchase of supplies, equipment, and services and shall not apply to public works construction projects.

Procedures and processes for the procurement of public works construction contracts are subject to the City Charter and the California Public Contract Code.

2.60.040 Purchasing Officer.

There is hereby created the position of Purchasing Officer. The City Manager shall be the Purchasing Officer. The City Manager may delegate any of the powers and duties conferred upon him or her as Purchasing Officer to any other officer or employee of the City in accordance with Section 2.60.050. The Purchasing Officer shall:

A. Purchase or contract for supplies, equipment, and services required by any department in accordance with purchasing procedures prescribed by this chapter, such administrative regulations as the Purchasing Officer shall adopt, and such other rules and regulations as shall be prescribed by the City Council; B. Negotiate, approve, and execute, as well as recommend approval and execution of contracts for the purchase of supplies, equipment, and services; C. Act to procure for the City the needed quality in supplies, equipment, and services at the least expense to the City;
D. Discourage uniform bidding and endeavor to obtain full and open competition on all purchases; provided, however, the Purchasing Officer may request bids based on brand name or specific make or model when he or she has made the determination that such specific makes or names are clearly in the best interest of the City. Such determination shall be made in writing and shall state the factors taken into account, including, but not limited to, the following:

1. Prior or existing use by the City of the brand or name,

2. Familiarity of the City’s employees with the product,

3. Cost savings expected,

4. Spare parts or accessories on hand,

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5. Elimination of the need for training on new equipment,

6. Unique adaptability of the brand or name to the city function which it will perform; E. Keep informed of current developments in the field of purchasing, prices, market conditions and new products;
F. Prescribe and maintain such forms as are reasonably necessary to the operation of this chapter and any other rules and regulations;
G. Coordinate the inspection of all supplies, equipment, and services purchased to ensure conformance with specifications;
H. Recommend the transfer of surplus or unused supplies and equipment between departments as needed and recommend the disposition of all supplies and equipment which have become unsuitable for City use; and
I. Maintain a bidders’ list, vendors’ catalog file and records needed for the efficient operation of purchasing functions.

2.60.050 Purchasing Agents.

The Purchasing Officer may delegate responsibility for administering purchasing policies and procedures to one or more department heads. A department head who has been delegated authority by the Purchasing Officer hereunder is referred to herein as a Purchasing Agent. The authorized Purchasing Agents and their contract authority must be approved in writing by the Purchasing Officer and maintained on file with the Director of Finance.

2.60.060 Purchasing authority.

A. City Council. Purchases of supplies, equipment, and services with a contract value of more than one hundred thousand dollars ($100,000.00) shall be awarded by written contract approved by the City Council pursuant to the procedures prescribed in this chapter.

B. City Manager. The City Manager is authorized to purchase supplies, equipment, and services with a contract value of up to one hundred thousand dollars ($100,000.00), without prior approval of the City Council, pursuant to the procedures prescribed in this chapter. The City Manager shall promptly notify the Budget Standing Committee in writing of any purchase of more than eighty thousand dollars ($80,000.00).

2.60.070 Encumbrance of funds.

Except in cases of emergency, the City Manager shall not issue any purchase order

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or contract for supplies, equipment, or services unless there exists an unencumbered appropriation in the adopted budget against which such purchases may be charged. The City Manager has the authority to transfer unencumbered funds between and among City departments for the procurement of supplies, equipment, and services as necessary to implement the provisions of his chapter.

2.60.080 Open market purchasing.

Purchases of equipment, supplies, and non-professional services with an estimated value of up to ten thousand dollars ($10,000.00) may be made by the Purchasing Officer in the open market without observing the procedures set forth in Sections

2.60.090 and 2.60.100.

2.60.090 Informal purchasing procedures.

Purchases of equipment, supplies, and non-professional services with an estimated value of more than ten thousand dollars ($10,000.00) and up to one hundred thousand dollars ($100,000.00) shall be made by the informal procedures set forth in this section.

A. Request for Proposals. The requesting department shall solicit informal proposals by telephone or written request to prospective vendors.

B. Number Proposals. Whenever possible, and except as otherwise provided in this chapter, informal purchases shall be based on at least three informal proposals.

Where, after a reasonable attempt has been made to solicit proposals no informal proposals are received, the purchase may be made in the open market.

C. Written Proposals. Informal proposals shall be submitted by vendors in writing to the Purchasing Officer, who shall keep a record of all informal proposals. This record, while so kept, shall be open to public inspection.

D. Award of Contract by Purchasing Officer. The purchase order or contract shall be awarded by the Purchasing Officer to the lowest cost proposer consistent with the best qualified vendor selection criteria set forth in Section 2.60.110.

E. Report to Budget Standing Committee. The City Manager shall promptly notify the Budget Standing Committee in writing of any informal purchase of equipment, supplies, or non-professional services made in accordance with this section with a contract value of more than eighty thousand dollars ($80,000.00).

2.60.100 Formal purchasing procedures.

Purchases of equipment, supplies, and non-professional services with an estimated value of more than one hundred thousand dollars ($100,000.00) shall be made by the formal procedures set forth in this section.

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A. Request for Proposals. An invitation for bids or request for proposals solicitation document shall be publicly noticed and made available to prospective vendors. The invitation for bids or request for proposals shall describe the requested supplies, equipment, or non-professional services in general terms, how to obtain more detailed information concerning the procurement, and state the time, place, and deadline for submission of proposals.

B. Published Notice. The invitation for bids or request for proposals shall be publicly noticed in any generally accepted manner, which includes on the City’s official website.

In addition, such notice may include publication in an adjudicated newspaper of general circulation, printed and published in the City, posting in at least three public places within the City that have been designated by resolution as the places for posting public notices, and/or a public bulletin board in City Hall.

C. Proposal Opening Procedure. Formal bids and proposals shall be submitted to the Purchasing Officer and shall be identified as formal competitive bids/proposals on the outside of the sealed envelope. The formal bids and proposals shall be opened in public at the time and place stated in the City’s solicitation document. A tabulation of all bids/proposals received shall be open for public inspection during regular business hours for a period of not less than thirty (30) calendar days after the proposal opening.

D. Rejection of Proposals. At its discretion, the City Council may reject any and all bids/proposals presented for any reason or for no reason, and may suspend, delay, or otherwise cancel the procurement, or may order the re-advertisement of the invitation for bids or request for proposals. If all formal bids or proposals are rejected and the City Council resolves by a recorded majority vote of the total membership of the City Council that the procurement can be performed more economically by force account, by informal procedures, or through open market purchases, then it may dispense with further formal competitive public bidding.

E. Tie Bids. If two or more formal bids or proposals received are the same and are the lowest, the City Council may accept the one it chooses.

F. No Bids Received. If no bids or proposals are received, the purchase may be let in the open market or by the informal procedures set forth in Section 2.60.090, subject to City Council approval.

G. Award of Contracts by City Council. Formal contracts shall be awarded by the City Council to the lowest cost proposer, except as otherwise provided herein, consistent with the best qualified vendor selection criteria set forth in Section 2.60.110.

H. Defects, Irregularities, and Informalities. The City Council may, in its sole discretion, waive any defect, irregularity, or informality in the formal bids or proposals or in the competitive procedures established in this section, and no such defect, irregularity, or informality shall void any contract entered into by the City.

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I. Performance Bonds. The Purchasing Officer shall have authority to recommend that a performance bond or other form of security or guarantee be required before entering a contract in such amount as may be reasonably necessary to protect the best interest of the City. If the City Council requires a performance bond or other form of security of guarantee, the form and amount of the bond, security or guarantee shall be described in the invitation for bids or request for proposals, and the performance bond, security or guarantee shall be in a form approved by the City Attorney.

2.60.110 Best qualified vendor.

In determining the best qualified vendor, consideration is to be given to quality and performance of equipment or supplies to be purchased and/or the non-professional services to be provided by the vendor. Criteria for determining the best qualified vendor shall include but not be limited to the following:

A. The cost of the equipment, supplies or non-professional services; B. The ability, capacity, and skill of the vendor to perform the contract and to provide the equipment, supplies, or non-professional services requested; C. The ability of the vendor to provide the equipment, supplies, or non-professional services requested promptly or within the time specified, without delay, interference, or service interruption;
D. The ability of the vendor to demonstrate the attributes of trustworthiness, quality, fitness, capacity, and experience to satisfactorily perform; E. The character, integrity, reputation, judgment, references, experience, and efficiency of the vendor;
F. The quality of vendor’s performance history and record on previous purchases or contracts with the City;
G. The ability of the vendor to provide future maintenance, repair parts, and services for the use of the goods and supplies, equipment, or materials purchased; and H. The ability of the vendor to demonstrate its prior, current, and continued compliance during the contract term with all applicable federal, state, and local laws, statutes, ordinances and all lawful orders, rules, and regulations promulgated thereunder.

2.60.120 Inspection and testing.

The Purchasing Officer or requesting department shall inspect supplies and equipment delivered and evaluate contract services performed to determine their

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conformance with the specifications set forth in the purchase order or contract. The Purchasing Officer or requesting department shall have the right to waive any defect or informality. The Purchasing Officer or requesting department shall have the authority to require chemical and physical tests of samples submitted with bids and samples of deliveries which are necessary to determine their quality and conformance with specifications.

2.60.130 Purchase orders required – Exception.

Purchases of supplies and equipment shall be made only by purchase order; provided, however, that any City department that maintains a City issued credit card may make purchases with such credit card of less than two thousand five hundred dollars ($2,500.00).

2.60.140 Exceptions to purchasing procedure.

The procurement policies and procedures set forth in Sections 2.60.090 and

2.60.100 may be dispensed with and are not applicable, irrespective of their estimated value, in the following situations:

A. Sole Source. When supplies, equipment, or non-professional services are of a unique, sole source nature because of their quality, durability, availability, or fitness for a particular use and are available only from one source. A sole source procurement is a procurement where only one source is practicably available for the type of procurement required;
B. Proprietary Procurement. When the equipment, supplies, or non-professional services are proprietary. A proprietary procurement is a procurement where the desired good or service must be restricted to one manufacturer because the good or service is compatible with or is an integral component of existing equipment or products, is necessary to support a specific need of a program, is covered by patent or copyright, must yield absolute continuity of results, or is one with which a user has extensive experience and the use of any other similar good or service would require considerable reorientation and training. Under such circumstances, an equitable evaluation of comparable goods or services should be made showing that rejection of other goods or services is based solely on their failure to meet that need; C. Emergency Purchases. When emergency conditions require the immediate purchase of equipment, supplies, or non-professional services from a known available source of supply. For purposes of this section, emergency purchases are those procurements that are required to prevent immediate interruption or cessation of necessary City services or to safeguard life, property, or the public health and welfare.

In the event of an emergency, the Purchasing Officer may contract for equipment, supplies or non-professional services. The Purchasing Officer shall file promptly with the City Council a report showing such emergency conditions and the necessity for such action, together with an itemized account of all expenditures; and

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D. Purchases though other Public Agencies. When the City Council or Purchasing Officer determines that another public agency or government entity, including without limitation the county of Orange, the state of California, and the Federal Government (hereinafter “the acquiring agency”) has selected the vendor using competitive bidding procedures substantially the same as or similar to those normally utilized by the City for the acquisition of the desired equipment, supplies or services. If such a determination is made, the City Council or Purchasing Officer, as applicable, may proceed to purchase the equipment, supplies or services at a price equivalent to that offered to the acquiring agency.

2.60.150 Professional services.

A. The procurement policies and procedures set forth in Sections 2.60.090,

2.60.100 shall not apply to contracts for professional services. The Purchasing Officer may award any contract for professional services when the total not to exceed contract amount is one hundred thousand dollars ($100,000.00) or less. Any contract for professional services having a total contract amount of more than one hundred thousand dollars ($100,000.00) shall be awarded by the City Council.

B. The City Manager shall promptly notify the Budget Standing Committee in writing of any purchase of professional services with a contract value of more than eighty thousand dollars ($80,000.00).

C. Notwithstanding any provision in this chapter to the contrary, selection by the City for professional services shall be on the basis of demonstrated competence and on the professional qualifications necessary for the satisfactory performance of the services required, and shall not be awarded solely on the basis of cost. The City shall consider price after the City is satisfied that the would-be person, company, corporation, contractor, consultant, or firm has demonstrated the competence and professional qualifications necessary for the satisfactory performance of the services required.

SECTION 3. If any section, subsection, subdivision, sentence, clause, phrase, or portion of this Ordinance for any reason is held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have adopted this Ordinance, and each section, subsection, subdivision, sentence, clause, phrase, or portion thereof, irrespective of the fact that any one or more sections, subsections, subdivisions, sentences, clauses, phrases, or portions thereof be declared invalid or unconstitutional.

SECTION 4. The City Clerk shall certify as to the adoption of this Ordinance and shall cause a summary thereof to be published within fifteen (15) days of the adoption and shall post a Certified copy of this Ordinance, including the vote for and against the same, in the Office of the City Clerk, in accordance with Government Code Section 36933.

CC ORD 2023-04

1783093.2
PASSED, APPROVED, AND ADOPTED this 23rd day of October, 2023.

Tanya Doby, Mayor
ATTEST:

Windmera Quintanar, MMC, City Clerk
APPROVED AS TO FORM:

Michael S. Daudt, City Attorney

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.

CITY OF LOS ALAMITOS )
I, Windmera Quintanar, MMC, City Clerk of the City of Los Alamitos, do hereby certify that the foregoing Ordinance was duly introduced and placed upon its first reading at a regular meeting of the City Council on the 18th day of September, 2023, and that thereafter, said Ordinance was duly adopted and passed at a regular meeting of the City Council on the 23rd day of October, 2023, by the following roll-call vote, to wit:

AYES: COUNCILMEMBERS:

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:

ABSTAIN: COUNCILMEMBERS:

Windmera Quintanar, MMC, City Clerk

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 11C
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: Update on City's Credit Rating

SUMMARY
This report will provide an update on the City's Credit Rating.

RECOMMENDATION
Receive and file the update regarding the City’s Credit rating.

BACKGROUND
Municipalities have credit ratings in connection with the issuance of general obligation bond issues.

DISCUSSION
On October 5, 2023, Standard and Poor's (S&P Global) released its current list of all 'AAA' rated municipalities. We are happy to report that Los Alamitos has received an "AAA" rating.

The next credit review for Los Alamitos is scheduled for 2025.

FISCAL IMPACT
There is no direct fiscal impact associated with this report. However, the 'AAA' rating helps further to solidify the City's financial status and position.

Attachment: 1. S&P Global 'AAA' Rated U.S Municipalities

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 11D
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: Amendment to City's Authorized Check Signers

SUMMARY
This report provides the Council with an update of the City’s authorized check signers.

RECOMMENDATION
Authorize the City Manager to add the City Treasurer as a check signer and to remove the City Clerk.

BACKGROUND
Currently, the City has three authorized check signers for its various bank accounts: Windmera Quintanar as City Clerk, Chet Simmons as City Manager, and Craig Koehler as City Treasurer.

The City Clerk and City Manager are currently being used for facsimile signatures for the warrant and any payroll-issued checks. The City Clerk was added as a signer due to the staff turnover. The Budget Standing Committee approved recommending the changes to the City Council at its November 6, 2023 Special meeting.

DISCUSSION
Resolution 2022-29 changed the City Treasurer designation from Chet Simmons (acting City Treasurer) to Craig Koehler, effective September 19, 2022. However, the facsimile signatures were kept the same when the City Treasurer designation was made in September 2022.

A change to add the City Treasurer to replace the City Clerk now serves as an additional administrative change to be in line with other governmental jurisdictions. The proposed change would result in the City Treasurer and City Manager as check signatories and would create additional efficiency measures. Adequate internal controls are also in place, as permanent staff have been added to the Finance Department.

FISCAL IMPACT
None.

Attachment: None

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 11E
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: PERS Trust Analysis

SUMMARY
Since adopting the City’s Fiscal Sustainability Plan, the Budget Standing Committee and the Los Alamitos City Council have been exploring different methods of maximizing investment opportunities that result in net savings for the City’s residents. Following 18 months of work with the Budget Standing Committee, a funding plan and policy was presented to the Council at the November 14, 2022, meeting, culminating in the adoption of Resolution 2022-33, PERS Unfunded Accrued Liability Pay-Down Funding Policy. This report provides the Council with a follow-up discussion on the PERS Unfunded Actuarial Liability (UAL) and consideration of possible additional funding analysis. The Budget Standing Committee discussed and recommend Council approval at its November 6, 2023, Special meeting.

RECOMMENDATION
Authorize the City Treasurer to initiate funding the City's Section 115 Trust with PARS for $50,000 monthly installments to accelerate paying down the PERS Unfunded Liability.

BACKGROUND
At the November 14, 2022, Council Meeting, Council adopted Resolution 2022-23, PERS Unfunded Accrued Liability Pay-Down Funding Policy, a UAL funding payment plan utilizing 12-year funding, with an estimated savings of $2.2 million, requiring additional ADP payment of $260,000 annually. The City established an IRS Section 115 Trust with Public Agencies PostEmployment Benefits (PARS) Trust in 2019. Funding for the Trust never materialized because the City was not financially able to undertake additional discretionary spending. With the passage of Measure Y, this is now possible and is one of the underlying commitments for using the funds.

DISCUSSION
In connection with the adoption of Resolution 2022-33, the UAL ADP of $260,000 was added to the Budget for FY23-24, and the first payment was made in July. With the recent report of CalPERS’s investment underperformance of -6.1% versus 6.8% expected rate of return (ER), staff requested that PFM provide additional analysis to consider funding the City’s 115 Trust with the established annual ADP of $260,000. As of the most recent valuation report dated June 30, 2022, the City’s classic pension plans have a combined UAL of $27.4 million, with Miscellaneous UAL at $12.4 million and Safety UAL at $14.9 million. This includes the recent balance increases attributed primarily to the underperformance of the CalPERS investment, as

noted above. CalPERS historical returns over the past 30 years have ranged from -24.0% to

21.7%, with an average of 8.0%. For the past five years, they have averaged 6.3%, underperforming their ER.

Due to these extreme fluctuations and uncertainty with the CalPERS rate of returns, staff requested PFM to review trust funding at two monthly levels, $50,000 and $100,000. The first scenario assumes 68 payments of $50,000, and the second scenario uses 34 payments of $100,000 that would be set aside in the trust growing at assumed investment rates using the latest PARS investment portfolio manager, HighMark. Capital Management data, rates ranging from 7.28 for 1-year to 5.42% for ten years.

The Budget Standing Committee reviewed both options and recommended funding the trust at $50,000 monthly. While both levels of funding result in an accelerated paydown of the unfunded liability, trust funding at the $50,000 level provides the City with maximum flexibility in meeting its other obligations and does not add additional strain to cash flow or liquidity.

Funding the Trust would be in addition to the already approved $260,000 annual ADP, and combined with the trust funding, will accelerate the UAL paydown.

FISCAL IMPACT
If approved, the additional UAL funding would require a further cash flow commitment of $600,000 annually to fund the Trust, with an equal offset and reduction to the established City PERS Reserve of $3.4 million.

Attachment: None

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 11F
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: Resolution No. 2023-26 - Minimum Hourly Wage Increase Effective January 1, 2024

SUMMARY
This report addresses the state-wide minimum wage increase that becomes effective January 1, 2024.

RECOMMENDATION
Adopt Resolution No. 2023-26, entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE

CITY OF LOS ALAMITOS, CALIFORNIA, AMENDING AND RESTATING THE HOURLY RATE SCHEDULE EFFECTIVE JANUARY 1, 2024 AND REPEALING EXHIBIT B FROM RESOLUTION NO. 2022-31.”

BACKGROUND
In 2016, Governor Jerry Brown signed Senate Bill 3 raising California’s mandatory minimum wage to $15.00 per hour by 2022. The state saw its first increase in January 2017, as the mandatory minimum wage increased from $10.00 to $10.50 per hour. The mandatory minimum was increased in January 2018 from $10.50 to $11.00 per hour. Effective January 1, 2019, the mandatory minimum wage increased from $11.00 to $12.00 per hour. The mandatory minimum wage was increased in January 2020 from $12.00 to $13.00 per hour, and January 2021 from $13.00 to $14.00 per hour. The City’s hourly rate schedule was updated to incorporate the 2022 minimum wage of $15.00 per hour, representing the final change reflected in Senate Bill 3. The 2023 minimum wage was further increased to $15.50 per hour per CPI.

DISCUSSION
Effective January 1, 2024, the state-mandated minimum wage will increase from $15.50 to $16.00 per hour. The City has seven hourly classifications (Recreation Leader, Police Aid/Cadet, Police Investigator, Police Reserve, Account Clerk, Administrative Intern, and Receptionist) that must be adjusted to meet the State minimum wage. Other classifications may be impacted as a result of these changes, but staff will return with other proposed changes pending the compensation study results.

FISCAL IMPACT
Sufficient funds were budgeted for the part-time Salary accounts in the fiscal year 2023-24.

Staff incorporated this scheduled wage increase into the original budget projections, so no budget amendment is necessary.

Attachment: 1. Resolution No. 2023-26 - Hourly Rate Schedule

2. Exhibit A - Hourly Rate Schedule

3. Resolution No. 2022-34 - Hourly Rate Schedule

RESOLUTION NO. 2023-26

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LOS

ALAMITOS, CALIFORNIA, AMENDING AND RESTATING THE
HOURLY RATE SCHEDULE EFFECTIVE JANUARY 1, 2024 AND
REPEALING EXHIBIT B FROM RESOLUTION NO. 2022-31
WHEREAS, in 2016, Governor Jerry Brown signed Senate Bill 3 raising California’s mandatory minimum wage to $15.50 per hour by 2023; and, WHEREAS, effective January 1, 2024, the mandatory minimum wage will increase from $15.50 per hour to $16.00 per hour; and,
WHEREAS, the City’s hourly rate schedule needs to be updated to incorporate the $16.00 per hour state-mandated minimum wage; and,
WHEREAS, effective January 1, 2024, this Resolution shall supersede and repeal Exhibit B from Resolution No. 2022-31.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS DOES RESOLVE AS FOLLOWS:

SECTION 1. The City Council of the City of Los Alamitos, California, finds that the above recitals are true and correct.

SECTION 2. The City of Los Alamitos hourly rate schedule is hereby amended and restated, effective January 1, 2024, to read as set forth in Exhibit “A,” attached hereto.

SECTION 3 The City Clerk shall certify as to the adoption of this Resolution.

PASSED, APPROVED, AND ADOPTED this 20th day of November, 2023.

Tanya Doby, Mayor
ATTEST:

Windmera Quintanar, MMC, City Clerk

CC RESO 2023-26

APPROVED AS TO FORM:

Michael S. Daudt, City Attorney

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss

CITY OF LOS ALAMITOS )
I, Windmera Quintanar, MMC, City Clerk, of the City of Los Alamitos, do hereby certify that the foregoing Resolution was adopted at a Regular meeting of the City Council held on the 20th day of November 2023, by the following vote, to wit:

AYEs: COUNCILMEMBERS:

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:

ABSTAIN: COUNCILMEMBERS:

Windmera Quintanar, MMC, City Clerk

CITY OF LOS ALAMITOS

HOURLY RATE SCHEDULE
Effective Januray 1, 2024
Attachment 1
CLASS
CODE

CLASSIFICATION

TITLE STEP A STEP B STEP C STEP D STEP E
905 Recreation Leader 16.00 16.80 17.64 18.52 19.45
921 Senior Recreation Leader 16.50 17.33 18.19 19.10 20.06 931 Recreation Specialist 17.33 18.20 19.11 20.06 21.06 955 Community Services Coordinator 19.95 20.95 21.99 23.09 24.25 910 Lifeguard 16.57 17.40 18.27 19.18 20.14
925 Water Safety Instructor I 17.57 18.45 19.37 20.34 21.36 935 Senior Lifeguard/Water Safety Instructor II 18.45 19.37 20.34 21.36 22.43 920 Police Aid/Cadet 16.00 16.80 17.64 18.52 19.45
945 Police Investigator 16.00 16.80 17.64 18.52 19.45
946 Police Reserve 16.00 16.80 17.64 18.52 19.45
965 Police Recruit 22.00
970 Photo Enforcement Officer 28.79 30.23 31.74 33.33 35.00 983 Ermergency Services Coordinator 32.92 34.57 36.29 38.11 40.00 940 Account Clerk 16.00 16.80 17.64 18.52 19.45
941 Administrative Intern 16.00 16.80 17.64 18.52 19.45 944 Clerical Assistant 18.25 19.16 20.12 21.13 22.18
947 Receptionist 16.00 16.80 17.64 18.52 19.00
960 Maintenance Worker 19.30 20.27 21.28 22.34 23.46
948 Department Secretary 22.83 23.97 25.17 26.43 27.76
951 Deputy City Clerk 27.72 29.11 30.56 32.09
971 Code Enforcement Officer 23.83 25.02 26.27 27.59 27.76 978 Senior Code Enforcement Officer 30.42 31.94 33.54 35.21 35.44 981 Special Projects Coordinator 38.20 40.11 42.12 44.22 46.44 982 Fiscal Sustainability Manager 47.44 52.18 56.92 61.03 66.40

DocuSign Envelope ID: 6802BBDB- 20AC- 4C34- B3AC- 95BAC2E31366 RESOLUTION NO. 2022- 31

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LOS

ALAMITOS, CALIFORNIA, AMENDING AND RESTATING THE
HOURLY RATE SCHEDULE EFFECTIVE JANUARY 1, 2023 AND
REPEALING EXHIBIT B FROM RESOLUTION NO. 2021-7
WHEREAS, in 2016, Governor Jerry Brown signed Senate Bill 3 raising California' smandatory minimum wage to $ 15. 00 per hour by 2022; and, WHEREAS, effective January 1, 2023, the mandatory minimum wage will increase from $ 15. 00 to $ 15. 50 per hour; and,
WHEREAS, the City' s hourly rate schedule needs to be updated to incorporate the

15. 50 per hour state mandated minimum wage; and,
WHEREAS, effective January 1, 2023, this Resolution shall supersede and repeal Exhibit B from Resolution No. 2021-7.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS DOES RESOLVE AS FOLLOWS:

SECTION 1. The City Council of the City of Los Alamitos, California, finds that the above recitals are true and correct.

SECTION 2. The City of Los Alamitos hourly rate schedule is hereby amended and restated, effective January 1, 2023, to read as set forth in Exhibit " A," attached hereto.

SECTION 3 The City Clerk shall certify as to the adoption of this Resolution.

PASSED, APPROVED, AND ADOPTED this 14th day of November, 2022. r—Docu Signeddbbyy:

Ar37r110C7A146D...

Shelley Hasselbrink,
ATTEST:

FDocuSigned
by:

RIA, khturec Attki- outr
S4BCC20B4CA8409...

Windmera Quintanar, MMC, City Clerk
Mayor

DocuSign Envelope ID: 6802BBDB- 2OAC- 4C34- B3AC- 95BAC2E31366 APPROVED AS TO FORM:

DocuSigned by:
r
l.

D2n022COC{ Dr490...

Michael S. Daudt, City Attorney

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss

CITY OF LOS ALAMITOS )
I, Windmera Quintanar, MMC, City Clerk, of the City of Los Alamitos, do hereby certify that the foregoing Resolution was adopted at a Regular meeting of the City Council held on the 14th day of November 2022, by the following vote, to wit:

AYEs: COUNCILMEMBERS: Doby, Chirco, Hasslebrink, Murphy, Nefulda NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: None
ABSTAIN: COUNCILMEMBERS: None
pDocuSigned by:

PivuobAit, re aiKfouve
ae roeac,, aa
Wn mera uintanar, MMC, City Clerk
CC RESO 2022- 31

DocuSign Envelope ID: 6802BBDB- 20AC- 4C34- B3AC- 95BAC2E31366

CITY OF LOS ALAMITOS

HOURLY RATE SCHEDULE
Effective January 1, 2023
CLASS
CODE

CLASSIFICATION
TITLE
Exhibit A

STEP A STEP B STEP C STEP D STEP E
905 Recreation Leader 15. 50 16. 28 17. 09 17. 94 18. 84 921 Senior Recreation Leader 16. 50 17. 33 18.9 19.0 20. 06 931 Recreation Specialist 17. 33 18.9 19.0 20. 06 21. 06 955 Community Services Coordinator 19. 95 20. 95 21. 99 23. 09 24.5 910 Lifeguard 16. 57 17. 40 18. 27 19.8 20. 14
925 Water Safety Instructor I 17. 57 18. 45 19. 37 20. 34 21. 36 935 Sr. Lifeguard/ Wter Safety Instructor 11 18. 45 19. 37 20. 34 21. 36 22. 42 920 Police Aid/ Cadet 15. 50 16. 28 17. 09 17. 94 18. 84 945 Police Investigator 15. 80 16. 59 17. 42 18. 29 19. 20 946 Police Reserve 15. 80 16. 59 17. 42 18. 29 19. 20
965 Police Recruit 22. 00
970 Photo Enforcement Officer 28. 79 30. 23 31. 74 33.3 35. 00 983 Emergency Services Coordinator 32. 92 34. 57 36. 29 38. 11 40. 00 940 Account Clerk 15. 50 16. 28 17. 09 17. 94 18. 84
941 Administrative Intern 15. 50 16. 28 17. 09 17. 94 18. 84 944 Clerical Assistant 18. 25 19.6 20. 12 21. 13 22. 18 947 Receptionist 15. 64 16. 42 17. 24 18.1 19. 00
960 Maintenance Worker 19. 30 20.7 21.8 22. 34 23. 46
948 Department Secretary 22. 83 23. 97 25. 17 26. 43 27. 76 971 Code Enforcement Officer 23. 83 25. 02 26.7 27. 59 28. 97 951 Deputy City Clerk 27. 72 29. 11 30. 56 32. 09 33. 69 978 Senior Code Enforcement Officer 30. 42 31. 94 33. 54 35. 21 36. 98 981 Special Projects Coordinator 38. 20 40. 11 42. 12 44. 22 46.4 982 Fiscal Sustainability Manager 47.4 52. 18 56. 92 61. 03 66. 40

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 11G
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: Investment Policy Update

SUMMARY
This report provides the Council with an update on the City’s Investment Policy and recommends amendments for allowable investments per the State Government Code.

RECOMMENDATION
Adopt Resolution No. 2023-25, entitled "A RESOLUTION OF THE CITY COUNCIL OF THE

CITY OF LOS ALAMITOS, CALIFORNIA, ADOPTING THE STATEMENT OF INVESTMENT POLICY DATED NOVEMBER 2023."

BACKGROUND
The Investment Policy provides the guidelines for prudent investment of the City’s reserve cash. It outlines the policies essential to ensuring the safety and financial strength of the City’s investment portfolio. The Budget Standing Committee reviewed the City’s Investment Policy at a Special Meeting on November 6, 2024. It is reviewed annually for submission and approval by the City Council. The Investment Policy is reviewed and presented to the Council each year. The last report was dated September 19, 2022. Attached is a copy of the Council report and current Investment Policy (Attachment 1).

The City’s investment portfolio consists primarily of Certificates of Deposit, U.S. Government Agency Securities, and investment in the Local Agency Investment Fund (State Investment Pool - LAIF). It should be noted that the City’s permitted investments are more restrictive than the State guidelines.

The City’s primary objectives, in order of priority, remain as follows:

1. Safety of principal,

2. Liquidity, and

3. Yield.

While investment risk is associated with any investment activity, there is also an opportunity risk related to inactivity. The goals and objectives will be to actively manage the City’s idle cash to earn a greater yield while prioritizing safety and liquidity.

DISCUSSION
Within the constraints of the investment guidelines, the investment portfolio has increased from $11.8 million (March 2020) to $27.4 million in a little over three years (March 2020 to June 2023). It has resulted in approximately half a million dollars in investment revenue (before adjustments).

To maximize the City’s earnings potential on its investment portfolio and be in compliance with investment guidelines as promulgated by the California Debt Advisory Committee (CDIAC), it is recommended that the Investment Policy be amended to expand the allowable investment instruments to be in line with the State Government Code, with the noted excluded exceptions.

Attached is the California Allowable Investments as of January 1, 2023, as defined by CDIAC (Attachment 2).

The proposed additional allowable investment instruments and changes include:
• Commercial Paper Non-Pooled Funds up to a maximum of 270 days or less (change from current 180 days).

This change could add approximately 20 basis points (from 5.60% for 180 days to 5.80% for 270 days). The resulting change could increase the interest generated from the $1 million commercial paper portfolio holdings. More importantly, it would provide broader access to some larger AAA issuers and result in more secure holdings. • Joint Powers California Asset Management Program Pool (CAMP).

The California Asset Management Program (CAMP) has existed since 1989. The investment option is for agencies with known cash flows to have the opportunity to optimize interest earnings. The current seven-day yield for CAMP is 5.55% versus LAIF at 3.59%. Since LAIF is slower to adjust to the market than the CAMP index, the resulting change to include investment in CAMP would add over 200 basis points to provide more significant earnings potential. For example, a CAMP portfolio balance of $2 million would result in approximately $40,000 in additional annual interest earnings. The CAMP pool would be used with LAIF to provide an additional investment portfolio tool to maximize interest earnings.

As previously defined, allowable investment instruments specifically exclude reverse repurchase agreements, derivatives, options, futures, zero coupon bonds, inverse floaters, range notes, first mortgages or trust deeds, collateralized mortgage obligations (CMOs), limited partnerships, real estate investment trusts (REIT’s), open-end mutual funds, closed-end mutual funds, mutual funds with a weighted average maturity greater than 180 days, unregulated and/or uninsured investment pools, common stock, preferred stock, commodities, precious metals, securities with high price volatility, limited marketability (less than three active bidders), securities that may default on interest payments and any other speculative investment deemed inappropriate under the Prudent Investor standard, all having terms of five years or less to maintain liquidity. A draft policy has been redlined to reflect the proposed changes (Attachment 4).

FISCAL IMPACT

There is no direct fiscal impact on allowing the requested changes. Still, there is the potential for increased interest earnings with the expansion of available investment options under the State Government Code.

Attachment: 1. 09-19-2022 Council Report Adopting Investment Policy

2. Allowable Investments CDIAC January 2023

3. Resolution 2023-25 - Annual Investment Policy (November 2023)

4. Exhibit A - November 2023 Investment Policy Redlined

RESOLUTION NO. 2022-28

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LOS

ALAMITOS, CALIFORNIA, ADOPTING THE STATEMENT OF
INVESTMENT POLICY DATED SEPTEMBER 2022
WHEREAS, Government Code 53646(a) (2) states that the treasurer of a local agency may annually present a statement of investment policy to the legislative body; and,
WHEREAS, it is the City’s policy to annually adopt the Statement of Investment Policy; and,
WHEREAS, the Statement of Investment Policy is intended to provide guidelines for the prudent investment of the City’s temporarily idle cash and to outline the policies for maximizing the efficiency of the City’s cash management system.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS DOES RESOLVE AS FOLLOWS:

SECTION 1. The City Council of the City of Los Alamitos, California, finds that the above recitals are true and correct.

SECTION 2. The City Council of the City of Los Alamitos hereby adopts the Statement of Investment Policy, dated September 2022 attached hereto as Exhibit “A.” SECTION 3. The City Clerk shall certify as to the adoption of this Resolution.

PASSED, APPROVED, AND ADOPTED this 19th day of September, 2022.

Shelley Hasselbrink, Mayor
ATTEST:

Windmera Quintanar, MMC, City Clerk
APPROVED AS TO FORM:

Michael S. Daudt, City Attorney

CC RESO 2022-28

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss

CITY OF LOS ALAMITOS )
I, Windmera Quintanar, MMC, City Clerk, of the City of Los Alamitos, do hereby certify that the foregoing Resolution was adopted at a Regular meeting of the City Council held on the 19th day of September 2022, by the following vote, to wit:

AYES:

NOES:

COUNCILMEMBERS: Doby, Chirco, Hasselbrink, Nefulda
COUNCILMEMBERS: None
COUNCILMEMBERS: None
COUNCILMEMBERS: None
ABSENT:

ABSTAIN:

Windmera Quintanar, MMC, City Clerk

City of Los Alamitos
Statement of Investment Policy
September 2022
This Statement of Investment Policy (“Policy”), as set forth by the City of Los Alamitos (“City”), provides the guidelines for prudent investment of the City’s idle or reserve cash and outlines the policies essential to ensuring the safety and financial strength of the City’s investment portfolio.

This Policy is based on the principles of prudent money management and conforms to all applicable Federal and State Laws governing the investment of public funds. In instances in which the Policy is more restrictive than Federal or State Law, the Policy will supersede.

1. Purpose: This statement sets forth policies which shall govern the investment of the City’s funds. It will be used by the City Treasurer and other City officials and staff, as well as all other third-party providers of investment or investment related services. Its purpose is to direct the prudent investment and protection of the City’s funds and investment portfolio, in compliance with the requirements of California Government Code Section 53600 et. seq.

2. Application: It is intended that this policy cover all short-term operating funds and investment activities under the direct authority of the City. These funds are described in the City’s annual financial report and include:

General Fund
Special Revenue Funds
Capital Projects Funds
Internal Service Funds
Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

This investment policy does not apply to Bond Proceeds. California Government Code Section 5922(d) authorizes bond, certificates of participation notes and other debt issue proceeds to be invested in accordance with the related offering documentation. This Code Section recognizes the unique needs and objectives of such proceeds.

3. Regulation:

A. Investment Objectives

Exhibit A
It is the policy of the City to invest public funds in a manner which will provide for the preservation of capital while meeting the daily cash flow requirements of the City, and attaining a reasonable rate of return within an acceptable and defined level of risk.

The Policy has three primary objectives in order of priority:

Preservation of Capital (Safety) – The protection of principal is the foremost consideration when undertaking investment decisions that affect public funds. The objective is to mitigate credit risk and interest rate risk.

Credit Risk is the risk of loss of principal due to the failure of the security issuer. Credit Risk can be mitigated by:

Limiting investments to the safest types of securities.

Pre-qualifying accountants, auditors, financial institutions, broker/dealers, financial advisors and other outside consultants with which the City does business.

Diversifying the investment portfolio so that potential losses are minimized Interest Rate Risk is the risk that the market value of securities will fall due to a rise in general market interest rates. It is the policy of the City to hold individual securities to maturity in an effort to meet liquidity demands. Interest rate risk can be mitigated by:

Holding individual securities to maturity - Structuring the investment portfolio so that securities mature to meet cash flow requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to maturity.

Employing a laddering strategy whereby staggering maturities of individual securities so that bonds come due in increments assuring an overall liquidity pattern.

Limiting maturities of individual securities and the average maturity of the overall portfolio.

Liquidity – the investment portfolio shall remain sufficiently liquid to meet all daily cash flow and operating requirements that may be reasonably expected or anticipated.

Yield – the investment portfolio shall be designed with the objective of attaining a benchmark rate of return throughout budgetary and economic cycles, consistent with the primary objectives of safety and liquidity.

B. Legal and Policy Constraints
The authority governing investments for municipal government agencies is set forth in the California Government Code Section 53600, et. seq. In all instances, the City of Los Alamitos shall comply with the requirements of state law.

In addition to the requirements of state law, it is the investment philosophy of the City to make investment decisions based on an overall passive management style that embodies a prudent investor standard and purchases investments with the intent to hold until maturity.

Accordingly, the City’s conservative philosophy prohibits active trading and speculation; i.e., the purchase of securities with the intent to profit from favorable market changes in market prices or market conditions. Leveraging or borrowing money for the purpose of investing is specifically prohibited. However, the City may elect to sell a security prior to its maturity and record a capital gain or loss in order to improve the quality, liquidity, or yield of the portfolio in response to market conditions or City needs.

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

C. Safekeeping of Securities
To protect against fraud or embezzlement or losses caused by collapse of an individual securities dealer, all securities owned by the City shall be held in safekeeping by a thirdparty bank trust department. Designated third party shall act as agents for the City under the terms of a custody agreement. All trades executed by a dealer will settle delivery vs. payment (DVP) through the City’s safekeeping agent. Investment officials shall be bonded to protect the public against possible embezzlement or malice. Securities held in custody for the City shall be independently audited on an annual basis to verify investment holdings.

D. Maturity and Term
California Government Code Section 53601 states that except as otherwise allowed:

No investment shall be made in any security, other than a security underlying a repurchase or reverse repurchase agreement authorized by this section, which at the time of the investment has a term remaining to maturity in excess of five years, unless the legislative body has granted express authority to make that investment either specifically or as a part of an investment program approved by the legislative body no less than three months prior to the investment.

The City of Los Alamitos administers funds according to cash flow requirements. As a result, there is a core of funds that are not necessary for the daily operational needs of the City for paying expenses. From time-to-time market conditions of fixed income markets present opportunities for higher interest rates on high grade securities with a lowrisk exposure. It is in the best interest of the City of Los Alamitos to practice a fully diversified investment plan that will ensure safety, liquidity, and the increase of acceptable yield from these situations.

To the extent possible, the City of Los Alamitos will attempt to match its investments with anticipated cash flow requirements.

Maturities of investments will be selected based on liquidity requirements to minimize interest rate risk and maximize earnings. Current and expected yield curve analysis will be monitored and the portfolio will be invested accordingly.

Market risk, the risk of market value fluctuations due to changes in the general level of interest rates, is mitigated by limiting the weighted average maturity of the portfolio along with a laddered structure. The weighted average maturity of the pooled portfolio should not exceed three years. At least 30% of the portfolio should have a maturity of 1 year or less with the balance of the portfolio laddered with maturities ranging from 1 to 5 years.

Exhibit A
No securities can be purchased with a maturity greater than five years without the prior approval of the City Council.

E. Investment Authority
The City Treasurer is authorized to make investments on behalf of the City of Los Alamitos. Such investments shall only be limited to the instruments authorized under California Government Code Sections 53601 and 53635 and further described in Appendix A and B.

All investments of the City of Los Alamitos shall be approved by the City Manager, or their designee.

No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the City Treasurer.

Officers and employees of the City of Los Alamitos involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees and investment officials shall disclose to the City Treasurer any material financial interests in financial institutions that conduct business with the City of Los Alamitos, and they shall further disclose any large personal financial/investment positions that could be related to the performance of the City of Los Alamitos, particularly with regard to the time of purchases and sales. The City Treasurer shall make similar disclosures to the City Council. Under no circumstances shall investment officers or employees accept gifts, trips, or any type of gratuity from individuals or institutions engaged in investment practices with the City of Los Alamitos.

F. Transfer of Investment Funds
The transferring of investment funds will be carried out exclusively by use of telephonic or electronic wire transfers. Each entity with which the City does business shall receive, in writing from the City Treasurer, a listing which limits transfers of funds to preauthorized bank accounts only. The listing will also contain the names of City staff authorized to request such transfers and will be updated, in writing, for all changes of authorized staff and bank accounts, as necessary.

G. Deposits
Money must be deposited in state or national banks, state or federal savings associations, or state or federal credit unions in the State of California. It may be in inactive deposits, active deposits or interest-bearing active deposits. The deposits cannot exceed the amount of the bank’s, savings and loan’s or credit union’s paid up capital surplus.

The bank or savings and loan must secure the active and inactive deposits with eligible securities having a market value of 110% of the total amount of the deposits. The

Exhibit A
investment officer may, at his/her discretion, waive security for that portion of a deposit which is insured pursuant to federal law. Currently, the first $250,000 of a deposit is federally insured. It is the City’s policy to waive this collateral requirement for the first $250,000 because it is possible to receive a higher rate.

The City will not maintain a deposit that is above the FDIC insured level. This will include the accrued interest on the deposit.

H. Permitted Investments
Investments shall be made only in those instruments specifically authorized by California State laws (Government Code Sections 53600-53609), and to no greater an extent than those authorized by those laws.

The City’s specific permitted investment guidelines are listed in Appendix A, with the noted restricted instruments A Glossary and a summary of the State of California Statues Applicable to Municipal Investments and is provided in Appendix B and C.

State and Federal laws notwithstanding, any investment not specifically described herein including, but not limited to, reverse repurchase agreements, derivatives, options, futures, zero coupon bonds, inverse floaters, range notes, first mortgages or trust deeds, collateralized mortgage obligations (CMO’s), limited partnerships, real estate investments trusts (REIT’s), open-end mutual funds, closed-end mutual funds, mutual funds with a weighted average maturity greater than 180 days, unregulated and/or uninsured investment pools, common stock, preferred stock, commodities, precious metals, securities with high price volatility, limited marketability (less than three active bidders), securities that may default on interest payments and any other speculative investment deemed inappropriate under the Prudent Investor standard are strictly prohibited. In addition, any investment transaction that might impair public confidence in the City of Los Alamitos government is to be avoided.

I. Diversification
The City of Los Alamitos shall diversify its investments by security type and institution.

The City recognizes diversification is an investment strategy that will mitigate risk in the investment portfolio. The City’s investment portfolio shall be diversified to avoid incurring unreasonable and avoidable risks with regard to specific investment types. Within investment types, the City shall also maintain a mix of securities to avoid concentrations within individual financial institutions, geographic areas, industry types and maturities.

The City will only invest in fixed rate securities.

J. Performance Standards
The investment portfolio shall be designed with the objective of obtaining a rate of return, throughout budgetary and economic cycles, commensurate with investment risk constraints and cash flow needs.

Exhibit A
Since the weighted average maturity of the pooled portfolio cannot exceed three years, the investment portfolio shall be designed to attain a market-average rate of return comparable to the Merrill Lynch 1-5 Year Federal Agency Index, on a total return basis, excluding the funds maintained in money market accounts.

K. Reporting
In accordance with California Government Code Sections 53607 and 53646, the City Treasurer and the City Manager shall render quarterly reports to the City Council showing: (a) type of investment; (b) institution; (c) date of maturity; (d) amount of deposit; (e) current market value for all securities with a maturity of more than twelve (12) months; (f) rate of interest on each security; and (g) such other data as the City Council may, from time to time, specify. (This section is applicable when the City Treasurer has invested in other types of securities other than LAIF.)
The City Treasurer shall establish an annual process of independent review by an external auditor. This review will provide internal control by assuring compliance with policies and procedures.

L. Policy Review

1. Annual Statement of Investment Policy
The City Treasurer and the City Manager shall annually render to the City Council a Statement of Investment Policy which Statement shall be adopted by the City Council.

2. Periodic Review
To ensure a statement which is consistent with any new relevant legislation and financial trends, the City Treasurer shall periodically report to the City Council proposed changes and amendments to this document for review and approval. In any event, all changes in state law affecting this policy shall be considered incorporated immediately upon their effective date unless otherwise adopted earlier by action of the City Council.

M. Qualified Dealers
The City of Los Alamitos shall purchase authorized investments either directly from the issuer or shall be purchased either from an institution licensed from the State as a broker dealer, as defined in the Corporations Code, or from a member of the federally regulated securities exchange, from a national or state chartered bank, from a savings association or federal association, or from a brokerage firm designated as a primary or regional government dealer.

The City Treasurer will maintain a list of financial institutions formally authorized to provide investment services. The City Treasurer shall formally authorize investment brokers to provide investment services to the City. Investment Brokers may be Primary Dealers or Regional Brokers and licensed to do business in the State of California. Brokers must

Exhibit A
complete a broker questionnaire which includes proof of Financial Industry Regulatory Authority (FINRA) certification, proof of State registration and execute a certification that the Broker’s employees and supervisory personnel have read and understand the City’s Investment Policy. The City Treasurer may conduct periodic reviews of the approved list of investment brokers and may remove a firm from the approval list at any time due to any failure to comply with any of the above criteria, failure to execute a transaction, any change in broker/dealer staff, or any action, event or failure to act which, in the sole discretion of the City Treasurer, is materially adverse to the best interest of the City of Los Alamitos.

Exhibit A
APPENDIX A -Permitted Investments

DEPOSITORY SERVICES
Active deposits are demand or checking accounts which receive revenues and pay disbursements.

Interest-bearing active deposits are money market accounts at a financial institution (i.e., bank, savings and loan, credit union). These accounts are demand accounts (i.e., checking accounts) with restricted transaction activity.

Inactive deposits are Certificates of Deposit issued in any amount for periods of time as short as fourteen days and as long as several years. Interest must be calculated on a 360 day basis, actual number of days.

Passbook savings account is similar to an inactive deposit except not for a fixed term.

The interest rate is much lower than Certificates of Deposit, but the savings account allows for flexibility. Funds can be deposited and withdrawn according to daily operational needs.

INVESTMENT SECURITIES
U.S. Treasury Issues are direct obligations of the United States Government. These issues are called bills, notes, and bonds. The maturity range of new issues is from 13 weeks (T-Bills) to 30 years (T-Bonds). These are highly liquid and are considered the safest investment security.

Federal Agency Issues are issued by direct U. S. Government agencies or quasigovernment agencies. These issues are guaranteed directly or indirectly by the United States Government. Examples of these securities are Federal Home Loan Bank (FHLB) notes, Federal National Mortgage Association (FNMA) notes, Federal Farm Credit Bank (FFCB) notes, Federal Home Loan Mortgage Corporation (FHLMC) notes, Federal Intermediate Credit Bank (FICB) debentures, Small Business Administration (SBA) notes, Government National Mortgage Association (GNMA) notes, and Student Loan Association (SALLMAE) notes.

Certificates of Deposit are investments for inactive funds issued by banks, savings and loans, and credit unions. Investments of $250,000 are insured respectively by Federal Deposit Insurance Corporation (FDIC), and the National Credit Union Share Insurance Fund (NCUSIF). Certificates of Deposit can be issued from 14 days to several years in maturity allowing the City investment of funds to be matched to cash flow needs. For deposits exceeding $250,000 , the financial institution is required to collateralize the investment with 110% government securities. The City does not accept 150% collateral (First Trust Deeds) or 105% Letters of Credit (L.C.).

Exhibit A
A Non-Negotiable Certificate of Deposit is a promissory note issued by a depository institution (such as a bank, credit union, a saving association, etc.) that usually carries a penalty for early withdrawal and does not have a CUSIP.

Negotiable Certificates of Deposit are issued by a nationally or state-chartered bank, a savings association or a federal association (as defined by Section 5102 of the Financial Code), a state or federal credit union, or by a federally licensed or state-licensed branch of a foreign bank and are assigned a CUSIP.

Local Agency Investment Fund (LAIF) is a special fund in the State Treasury which local agencies may use to deposit funds for investment. There is no minimum investment period and the minimum transaction is $5,000, in multiples of $1,000 above that, with a maximum of $50 million for any agency. It offers high liquidity because deposits can be converted to cash in twenty-four hours and no interest is lost. All interest is distributed to those agencies participating on a proportionate share determined by the amounts deposited and the length of time they are deposited. Interest is paid quarterly by electronic deposit to a designated bank account.

The State keeps an amount for reasonable costs of making the investments. State law provides that administrative costs are not to exceed 5% of quarterly earnings of the fund.

However, if the 13-week Daily Treasury Bill Rate on the last day of the fiscal year is below 1%, then administrative costs shall not exceed 8% of quarterly earnings of the fund for the subsequent fiscal year.

Local Agency Bonds are bonds issued by other local agencies, maximum maturity 5 years, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53601(a).

State Obligations – CA and others are obligations issued by California and other states, maximum maturity 5 years, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53601(c)(d).

California Local Agency Obligations are obligations issued by local agencies within California, maximum maturity 5 years, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53601(e).

Bankers’ Acceptances are a negotiable piece of paper that functions like a post-dated check. A bank, rather than an account holder, guarantees the payment. Banker's acceptances (also known as bills of exchange) are used by companies as a relatively safe form of payment for large transactions. BAs can also be short-term debt instruments, similar to U.S. Treasury bills, that trade at a discount to face value, maximum maturity 180 days, specified at 40% maximum percentage of portfolio, no minimum quality requirements, Government Code 53601(g).

Placement Service Deposits are deposit placement services, which enables funds to be placed in demand deposit accounts, money market deposit accounts, or both,

Exhibit A
maximum maturity 5 years, specified 50% maximum percentage of portfolio, no minimum quality requirements, Government Code 53601.8 and 53635.8.

Placement Service Certificates of Deposit are certificates of deposit placed by a service on behalf of banks and credit unions that are FDIC or NCUA insured, 5 years maximum maturity, specified 50% maximum percentage of portfolio, no minimum quality requirements, Government Code 53601.8 and 53635.8.

Collaterized Bank Deposits are protected public funds backed by a collateriztion agreement to protect the principal in the event of failure by the financial institution, maximum maturity 5 years, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53630 et seq, and 53601(n).

Mortgage Pass-Through and Asset-Backed Securities are pools of fixed-income securities backed by a package of assets. A servicing intermediary collects the monthly payments from issuers and, after deducting a fee, remits or passes them through to the holders of the pass-through security or entities who have invested in it). A pass-through security is also known as a "pay-through security" or a "pass-through certificate "though technically the certificate is the evidence of interest or participation in a pool of assets that signifies the transfer of payments to investors; it's not the security itself; maturity maximum maturity 5 years or less; specified maximum of 20% of portfolio; AA rating or better; Government Code 53061(o).

Commercial Paper Non- Pooled Funds (under $100 million investments) – are shortterm money market instruments that is used for obtaining short-term funding secured by a promissory note; maximum maturity 180 days or less, specified maximum of 25% of portfolio, rating of highest letter by NRSRO, Government Code 53601(h)(2)(c).

Medium Term Notes – are securities that are collaterized in an amount equal to their full outstanding principal amount; maximum maturity 5 years or less, specified maximum 30% of portfolio, A rating or better, Government Code 53601(k).

County Pooled Investment Funds are investments that are combined in a pool from all participating members and share in the performance of the pooled money; generally large county pools like Orange County Investment Pool (OCIP), no specified maturity but would default to 5 years maximum, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 27133.

Public Bank Obligations are obligations issued by a public bank or financial institution, in which a state, municipality, or public actors are the owners. It is an enterprise under government control. Prominent among current public banking models are the Bank of North Dakota, the German public bank system, and many nations’ postal bank systems, maximum maturity 5 years, no specified percentage of portfolio, no minimum quality requirements, Government Code 53601(r), 53635(c), and 57603.

Exhibit A
CUSIP (Committee on Uniform Security Identification Procedures) is a nine-character alphanumeric code that identifies a North American financial security for the purposes of facilitating clearing and settlement of trades.

RESOLUTION NO. 2023-25

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LOS

ALAMITOS, CALIFORNIA, ADOPTING THE STATEMENT OF
INVESTMENT POLICY DATED NOVEMBER 2023
WHEREAS, Government Code 53646(a) (2) states that the treasurer of a local agency may annually present a statement of investment policy to the legislative body; and,
WHEREAS, it is the City’s policy to annually adopt the Statement of Investment Policy; and,
WHEREAS, the Statement of Investment Policy is intended to provide guidelines for the prudent investment of the City’s temporarily idle cash and to outline the policies for maximizing the efficiency of the City’s cash management system.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS DOES RESOLVE AS FOLLOWS:

SECTION 1. The City Council of the City of Los Alamitos, California, finds that the above recitals are true and correct.

SECTION 2. The City Council of the City of Los Alamitos hereby adopts the Statement of Investment Policy, dated November 2023, attached hereto as Exhibit “A.” SECTION 3. The City Clerk shall certify as to the adoption of this Resolution.

PASSED, APPROVED, AND ADOPTED this 20th day of November , 2023.

Tanya Doby, Mayor
ATTEST:

Windmera Quintanar, MMC, City Clerk
APPROVED AS TO FORM:

Michael S. Daudt, City Attorney

CC RESO 2023-25

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss

CITY OF LOS ALAMITOS )
I, Windmera Quintanar, MMC, City Clerk, of the City of Los Alamitos, do hereby certify that the foregoing Resolution was adopted at a Regular meeting of the City Council held on the 20th day of November 2023, by the following vote, to wit:

AYEs: COUNCILMEMBERS:

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:

ABSTAIN: COUNCILMEMBERS:

Windmera Quintanar, MMC, City Clerk

City of Los Alamitos
Statement of Investment Policy
NovemberSeptember 20232
This Statement of Investment Policy (“Policy”), as set forth by the City of Los Alamitos (“City”), provides the guidelines for prudent investment of the City’s idle or reserve cash and outlines the policies essential to ensuring the safety and financial strength of the City’s investment portfolio.

This Policy is based on the principles of prudent money management and conforms to all applicable Federal and State Laws governing the investment of public funds. In instances in whichwhere the Policy is more restrictive than Federal or State Law, the Policy will supersede.

1. Purpose: This statement sets forth policies which that shall govern the investment of the City’s funds. It will be used by the City Treasurer and other City officials and staff, as well as all other third-party providers of investment or investment relatedinvestmentrelated services. Its purpose is to direct the prudent investment and protection of the City’s funds and investment portfolio, in compliance with the requirements of California Government Code Section 53600 et. seq.

2. Application: It is intended that this policy cover all short-term operating funds and investment activities under the direct authority of the City. These funds are described in the City’s annual financial report and include:

General Fund
Special Revenue Funds
Capital Projects Funds
Internal Service Funds
Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

This investment policy does not apply to Bond Proceeds. California Government Code Section 5922(d) authorizes bond, certificates of participation notes and other debt issue proceeds to be invested in accordance with the related offering documentation. This Code Section recognizes the unique needs and objectives of such proceeds.

3. Regulation:

A. Investment Objectives

Exhibit A
It is the policy of the City to invest public funds in a manner which will provide for the preservation of capital while meeting the daily cash flow requirements of the City, and attaining a reasonable rate of return within an acceptable and defined level of risk.

The Policy has three primary objectives in order of priority:

Preservation of Capital (Safety) – The protection of principal is the foremost consideration when undertaking investment decisions that affect public funds. The objective is to mitigate credit risk and interest rate risk.

Credit Risk is the risk of loss of principal due to the failure of the security issuer. Credit Risk can be mitigated by:

Limiting investments to the safest types of securities.

Pre-qualifying accountants, auditors, financial institutions, broker/dealers, financial advisors, and other outside consultants with which the City does business.

Diversifying the investment portfolio so that potential losses are minimized Interest Rate Risk is the risk that the market value of securities will fall due to a rise in general market interest rates. It is the policy of the City to hold individual securities to maturity in an effort to meet liquidity demands. Interest rate risk can be mitigated by:

Holding individual securities to maturity - Structuring the investment portfolio so that securities mature to meet cash flow requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to maturity.

Employing a laddering strategy whereby staggering maturities of individual securities so that bonds come due in increments assuring an overall liquidity pattern.

Limiting maturities of individual securities and the average maturity of the overall portfolio.

Liquidity – the investment portfolio shall remain sufficiently liquid to meet all daily cash flow and operating requirements that may be reasonably expected or anticipated.

Yield – the investment portfolio shall be designed with the objective of attaining a benchmark rate of return throughout budgetary and economic cycles, consistent with the primary objectives of safety and liquidity.

B. Legal and Policy Constraints
The authority governing investments for municipal government agencies is set forth inoutlined in the California Government Code Section 53600, et. seq. In all instances, the City of Los Alamitos shall comply with the requirements of state law.

In addition to the requirements of state law, it is the investment philosophy of the City to make investment decisions based on an overall passive management style that embodies a prudent investor standard and purchases investments with the intent to hold until maturity.

Accordingly, the City’s conservative philosophy prohibits active trading and speculation; , i.e., the purchase of securities with the intent to profit from favorable market changes in market prices or market conditions. Leveraging or borrowing money for the purpose of investing is specifically expressly prohibited. However, the City may elect to sell a security prior to its maturity and record a capital gain or loss in order to improve the quality, liquidity, or yield of the portfolio in response to market conditions or City needs.

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

C. Safekeeping of Securities
To protect against fraud or embezzlement or losses caused by collapse of an individual securities dealer, all securities owned by the City shall be held in safekeeping by a thirdparty bank trust department. Designated third party shall act as agents for the City under the terms of a custody agreement. All trades executed by a dealer will settle delivery vs. payment (DVP) through the City’s safekeeping agent. Investment officials shall be bonded to protect the public against possible embezzlement or malice. Securities held in custody for the City shall be independently audited on an annual basis to verify investment holdings.

D. Maturity and Term
California Government Code Section 53601 states that except as otherwise allowed:

No investment shall be made in any security, other than a security underlying a repurchase or reverse repurchase agreement authorized by this section, which at the time of the investment has a term remaining to maturity in excess of five years, unless the legislative body has granted express authority to make that investment either specifically or as a part of an investment program approved by the legislative body no less than three months prior to the investment.

The City of Los Alamitos administers funds according to cash flow requirements. As a result, there is a core of funds that are not necessary for the daily operational needs of the City for paying expenses. From time-to-time market conditions of fixed incomefixedincome markets present opportunities for higher interest rates on high gradehigh-grade securities with a low-risk exposure. It is in the best interest of the City of Los Alamitos to practice a fully diversified investment plan that will ensure safety, liquidity, and the increase of acceptable yield from these situations.

To the extent possible, the City of Los Alamitos will attempt to match its investments with anticipated cash flow requirements.

Maturities of investments will be selected based on liquidity requirements to minimize interest rate risk and maximize earnings. Current and expected yield curve analysis will be monitored, and the portfolio will be invested accordingly.

Market risk, the risk of market value fluctuations due to changes in the general level of interest rates, is mitigated by limiting the weighted average maturity of the portfolio along with a laddered structure. The weighted average maturity of the pooled portfolio should not exceed three years. At least 30% of the portfolio should have a maturity of 1 year or less, with the balance of the portfolio laddered with maturities ranging from 1 to 5 years.

Exhibit A
No securities can be purchased with a maturity greater than five years without the prior approval of the City Council.

E. Investment Authority
The City Treasurer is authorized to make investments on behalf of the City of Los Alamitos. Such investments shall only be limited to the instruments authorized under California Government Code Sections 53601 and 53635 and further described in Appendix A and B.

All investments of the City of Los Alamitos shall be approved by the City Manager, or their designee.

No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the City Treasurer.

Officers and employees of the City of Los Alamitos involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees and investment officials shall disclose to the City Treasurer any material financial interests in financial institutions that conduct business with the City of Los Alamitos, and they shall further disclose any large personal financial/investment positions that could be related to the performance of the City of Los Alamitos, particularly with regard to the time of purchases and sales. The City Treasurer shall make similar disclosures to the City Council. Under no circumstances shall investment officers or employees accept gifts, trips, or any type of gratuity from individuals or institutions engaged in investment practices with the City of Los Alamitos.

F. Transfer of Investment Funds
The transferring of investment funds will be carried out exclusively by use of telephonic or electronic wire transfers. Each entity with which the City does business shall receive, in writing from the City Treasurer, a listing which limits transfers of funds to preauthorized bank accounts only. The listing will also contain the names of City staff authorized to request such transfers and will be updated, in writing, for all changes of authorized staff and bank accounts, as necessary.

G. Deposits
Money must be deposited in state or national banks, state or federal savings associations, or state or federal credit unions in the State of California. It may be in inactive deposits, active deposits, or interest-bearing active deposits. The deposits cannot exceed the amount of the bank’s, savings and loan’s loan or credit union’s paid uppaid-up capital surplus.

Exhibit A
The bank or savings and loan must secure the active and inactive deposits with eligible securities having a market value of 110% of the total amount of the deposits. The investment officer may, at his/her discretion, waive security for that portion of a deposit which that is insured pursuant to federal law. Currently, the first $250,000 of a deposit is federally insured. It is the City’s policy to waive this collateral requirement for the first $250,000 because it is possible to receive a higher rate.

The City will not maintain a deposit that is above the FDIC insured level. This will include the the accrued interest on the deposit.

H. Permitted Investments
Investments shall be made only in those instruments specifically authorized by California State laws (Government Code Sections 53600-53609), and to no greater an extent than those authorized by those laws.

The City’s specific permitted investment guidelines are listed in Appendix A, with the noted restricted instruments A Glossary and a summary of the State of California Statues Applicablestatutes applicable to Municipal Investments and is provided in Appendix B and C.

State and Federal laws notwithstanding, any investment not specifically explicitly described herein including, but not limited to, reverse repurchase agreements, derivatives, options, futures, zero coupon bonds, inverse floaters, range notes, first mortgages or trust deeds, collateralized mortgage obligations (CMO’s), limited partnerships, real estate investments trusts (REIT’s), open-end mutual funds, closed-end mutual funds, mutual funds with a weighted average maturity greater more than 180 days, unregulated and/or uninsured investment pools, common stock, preferred stock, commodities, precious metals, securities with high price volatility, limited marketability (less than three active bidders), securities that may default on interest payments and any other speculative investment deemed inappropriate under the Prudent Investor standard are strictly prohibited. In addition, any investment transaction that might impair public confidence in the City of Los Alamitos government is tomust be avoided.

I. Diversification
The City of Los Alamitos shall diversify its investments by security type and institution.

The City recognizes diversification is an investment strategy that will mitigate risk in the investment portfolio. The City’s investment portfolio shall be diversified to avoid incurring unreasonable and avoidable risks with regard to specific investment types. Within investment types, the City shall also maintain a mix of securities to avoid concentrations within individual financial institutions, geographic areas, industry types and maturities.

The City will only invest in fixed rate securities.

Exhibit A
J. Performance Standards
The investment portfolio shall be designed with the objective of obtaining a rate of return, throughout budgetary and economic cycles, commensurate with investment risk constraints and cash flow needs.

Since the weighted average maturity of the pooled portfolio cannot exceed three years, the investment portfolio shall be designed to attain a market-average rate of return comparable to the Merrill Lynch 1-5 Year Federal Agency Index, on a total return basis, excluding the funds maintained in money market accounts.

K. Reporting
In accordance with California Government Code Sections 53607 and 53646, the City Treasurer and the City Manager shall render quarterly quarterly reports to the City Council showing: (a) type of investment; (b) institution; (c) date of maturity; (d) amount of deposit; (e) current market value for all securities with a maturity of more than twelve (12) months; (f) rate of interest on each security; and (g) such other data as the City Council may, from time to time, specify. (This section is applicable when the City Treasurer has invested in other types of securities other than LAIF.) The City Treasurer shall establish an annual process of independent review by an external auditor. This review will provide internal control by assuring compliance with policies and procedures.

L. Policy Review

1. Annual Statement of Investment Policy
The City Treasurer and the City Manager shall annually render to the City Council a Statement of Investment Policy, which Statement shall be adopted by the City Council.

2. Periodic Review
To ensure a statement which that is consistent with any new relevant legislation and financial trends, the City Treasurer shall periodically report to the City Council proposed changes and amendments to this document for review and approval. In any event, all changes in state law affecting this policy shall be considered incorporated immediately upon their effective date unless otherwise adopted earlier by action of the City Council.

M. Qualified Dealers
The City of Los Alamitos shall purchase authorized investments either directly from the issuer or shall be purchased either from an institution licensed from by the State as a broker dealerbroker-dealer, as defined in the Corporations Code, or from a member of the federally regulated securities exchange, from a national or state charteredstatechartered bank, from a savings association or federal association, or from a brokerage firm designated as a primary or regional government dealer.

Exhibit A
The City Treasurer will maintain a list of financial institutions formally authorized to provide investment services. The City Treasurer shall formally authorize investment brokers to provide investment services to the City. Investment Brokers may be Primary Dealers or Regional Brokers and licensed to do business in the State of California. Brokers must complete a broker questionnaire which includes proof of Financial Industry Regulatory Authority (FINRA) certification, and proof of State registration and execute a certification that the Broker’s employees and supervisory personnel have read and understand the City’s Investment Policy. The City Treasurer may conduct periodic reviews of the approved list of investment brokers and may remove a firm from the approval list at any time due to any failure to comply with any of the above criteria, failure to execute a transaction, any change in broker/dealer staff, or any action, event or failure to act which, in the sole discretion of the City Treasurer, is materially adverse to the best interest of the City of Los Alamitos.

Exhibit A
APPENDIX A -Permitted Investments

DEPOSITORY SERVICES
Active deposits are demand or checking accounts which receive revenues and pay disbursements.

Interest-bearing active deposits are money market accounts at a financial institution (i.e., bank, savings and loan, credit union). These accounts are demand accounts (i.e., checking accounts) with restricted transaction activity.

Inactive deposits are Certificates of Deposit issued in any amount for periods of time as short as fourteen days and as long as several years. Interest must be calculated on a 360 day basis, actual number of days.

Passbook savings account is similar to an inactive deposit except not for a fixed term.

The interest rate is much lower than Certificates of Deposit, but the savings account allows for flexibility. Funds can be deposited and withdrawn according to daily operational needs.

INVESTMENT SECURITIES
U.S. Treasury Issues are direct obligations of the United States Government. These issues are called bills, notes, and bonds. The maturity range of new issues is from 13 weeks (T-Bills) to 30 years (T-Bonds). These are highly liquid and are considered the safest investment security.

Federal Agency Issues are issued by direct U. S. Government agencies or quasigovernment agencies. These issues are guaranteed directly or indirectly by the United States Government. Examples of these securities are Federal Home Loan Bank (FHLB) notes, Federal National Mortgage Association (FNMA) notes, Federal Farm Credit Bank (FFCB) notes, Federal Home Loan Mortgage Corporation (FHLMC) notes, Federal Intermediate Credit Bank (FICB) debentures, Small Business Administration (SBA) notes, Government National Mortgage Association (GNMA) notes, and Student Loan Association (SALLMAE) notes.

Certificates of Deposit are investments for inactive funds issued by banks, savings and loans, and credit unions. Investments of $250,000 are insured respectively by Federal Deposit Insurance Corporation (FDIC), and the National Credit Union Share Insurance Fund (NCUSIF). Certificates of Deposit can be issued from 14 days to several years in maturity, allowing the City investment of funds to be matched to cash flow needs. For deposits exceeding $250,000 , the financial institution is required to collateralize the investment with 110% government securities. The City does not accept 150% collateral (First Trust Deeds) or 105% Letters of Credit (L.C.).

Exhibit A
A Non-Negotiable Certificate of Deposit is a promissory note issued by a depository institution (such as a bank, credit union, a saving association, etc.) that usually carries a penalty for early withdrawal and does not have a CUSIP.

Negotiable Certificates of Deposit are issued by a nationally or state-chartered bank, a savings association or a federal association (as defined by Section 5102 of the Financial Code), a state or federal credit union, or by a federally licensed or state-licensed branch of a foreign bank and are assigned a CUSIP.

Local Agency Investment Fund (LAIF) is a special fund in the State Treasury which local agencies may use to deposit funds for investment. There is no minimum investment period and the minimum transaction is $5,000, in multiples of $1,000 above that, with a maximum of $50 million for any agency. It offers high liquidity because deposits can be converted to cash in twenty-four hours and no interest is lost. All interest is distributed to those agencies participating on a proportionate share determined by the amounts deposited and the length of time they are deposited. Interest is paid quarterly by electronic deposit to a designated bank account.

The State keeps an amount for reasonable costs of making the investments. State law provides that administrative costs are not to exceed 5% of quarterly earnings of the fund.

However, if the 13-week Daily Treasury Bill Rate on the last day of the fiscal year is below 1%, then administrative costs shall not exceed 8% of quarterly earnings of the fund for the subsequent fiscal year.

Local Agency Bonds are bonds issued by other local agencies, maximum maturity 5 years, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53601(a).

State Obligations – CA and others are obligations issued by California and other states, maximum maturity 5 years, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53601(c)(d).

California Local Agency Obligations are obligations issued by local agencies within California, maximum maturity 5 years, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53601(e).

Bankers’ Acceptances are a negotiable piece of paper that functions like a post-dated check. A bank, rather than an account holder, guarantees the payment. Banker's acceptances (also known as bills of exchange) are used by companies as a relatively safe form of payment for large transactions. BAs can also be short-term debt instruments, similar to U.S. Treasury bills, that trade at a discount to face value, maximum maturity 180 days, specified at 40% maximum percentage of portfolio, no minimum quality requirements, Government Code 53601(g).

Placement Service Deposits are deposit placement services, which enables funds to be placed in demand deposit accounts, money market deposit accounts, or both,

Exhibit A
maximum maturity 5 years, specified 50% maximum percentage of portfolio, no minimum quality requirements, Government Code 53601.8 and 53635.8.

Placement Service Certificates of Deposit are certificates of deposit placed by a service on behalf of banks and credit unions that are FDIC or NCUA insured, 5 years maximum maturity, specified 50% maximum percentage of portfolio, no minimum quality requirements, Government Code 53601.8 and 53635.8.

Collaterized Bank Deposits are protected public funds backed by a collateriztion agreement to protect the principal in the event of failure by the financial institution, maximum maturity 5 years, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53630 et seq, and 53601(n).

Mortgage Pass-Through and Asset-Backed Securities are pools of fixed-income securities backed by a package of assets. A servicing intermediary collects the monthly payments from issuers and, after deducting a fee, remits or passes them through to the holders of the pass-through security or entities who have invested in it). A pass-through security is also known as a "pay-through security" or a "pass-through certificate "though technically the certificate is the evidence of interest or participation in a pool of assets that signifies the transfer of payments to investors; it's not the security itself; maturity maximum maturity 5 years or less; specified maximum of 20% of portfolio; AA rating or better; Government Code 53061(o).

Commercial Paper Non- Pooled Funds (under $100 million investments) – are shortterm money market instruments that is used for obtaining short-term funding secured by a promissory note; maximum maturity 270180 days or less, specified maximum of 25% of portfolio, rating of highest letter by NRSRO, Government Code 53601(h)(2)(c).

Medium Term Notes – are securities that are collaterized in an amount equal to their full outstanding principal amount; maximum maturity 5 years or less, specified maximum 30% of portfolio, A rating or better, Government Code 53601(k).

County Pooled Investment Funds are investments that are combined in a pool from all participating members and share in the performance of the pooled money; generally large county pools like Orange County Investment Pool (OCIP), no specified maturity but would default to 5 years maximum, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 27133.

Joint Powers Authority Pool – California Asset Management Program are investments that are combined in a qualified pool from all participating members and share in the performance of the pooled money; generally large county pools like Orange County Investment Pool (OCIP), no specified maturity but would default to 5 years maximum, no maximum specified percentage of portfolio, no minimum quality requirements, Government Code 53601 (p).

Exhibit A
Public Bank Obligations are obligations issued by a public bank or financial institution, in which a state, municipality, or public actors are the owners. It is an enterprise under government control. Prominent among current public banking models are the Bank of North Dakota, the German public bank system, and many nations’ postal bank systems, maximum maturity 5 years, no specified percentage of portfolio, no minimum quality requirements, Government Code 53601(r), 53635(c), and 57603.

CUSIP (Committee on Uniform Security Identification Procedures) is a nine-character alphanumeric code that identifies a North American financial security for the purposes of facilitating clearing and settlement of trades.

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 11H
To: Mayor Tanya Doby & Members of the City Council
Presented By: Craig Koehler, Director of Finance
Subject: Resolution No. 2023-24 - Adopting the June 30, 2023 Measure M2 Expenditure Report

SUMMARY
Each agency that receives Measure M2 funds is required by the Orange County Transportation Authority to adopt an annual Expenditure Report to account for the use of Measure M2 funds.

RECOMMENDATION
Adopt Resolution No. 2023-24, entitled "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS, CALIFORNIA, CONCERNING THE MEASURE M2

EXPENDITURE REPORT FOR THE CITY OF LOS ALAMITOS FOR THE FISCAL YEAR ENDING JUNE 30, 2023."

BACKGROUND
On November 7, 2006, Orange County voters approved the renewal of the Measure M onehalf cent sales tax for transportation improvements. This renewal plan is designated as Measure M2 and provides funding for 30 years that focuses solely on improving the regional transportation system, The measure includes taxpayer safeguards; one of which is a requirement to provide the annual expenditure report. Within six months of the close of the fiscal year, each agency must complete and submit a Measure M2 expenditure report and accompanying resolution to the City Council for adoption and approval.

DISCUSSION
The M2 Expenditure Report includes all possible funds. The line item referred to throughout this report is labeled as "Local Fair Share". Below is a summary of the fund.

Fund Balance - Schedule 1
$577,945 as of June 30, 2023
This amount includes funds received totaling $574,554 and interest earned on unexpended receipts of $3,391.

Revenues - Schedule 2
$314,116 in Fiscal Year 2022-23
This amount includes revenues received totaling $302,402 and earned interest on receipts in the amount of $11,714.

Expenditures - Schedule 2 and 3
$329,584 in Fiscal Year 2022-23
This amount includes expenditures of $317,870 and earned interest on receipts in the amount of $11,714.

Local Fair Share Project List - Schedule 4
$329,584 in Fiscal Year 2022-23
This schedule shows the amounts expended on various transportation improvement projects.

FISCAL IMPACT
Adoption, as required, will ensure the City will continue to receive Measure M2 allocations.

Total revenues for FY2023-24 are expected to be $227,000.00 Attachment: 1. Resolution 2023-24 - Measure M2 Expenditure Report

2. Exhibit A - M2 Expenditure Report

RESOLUTION NO. 2023-24

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

LOS ALAMITOS, CALIFORNIA, CONCERNING THE
MEASURE M2 EXPENDITURE REPORT FOR THE CITY OF
LOS ALAMITOS FOR THE FISCAL YEAR ENDING JUNE 30,
2023
WHEREAS, local jurisdictions are required to meet eligibility requirements and submit eligibility verification packages to Orange County Transportation Authority (OCTA) in order to remain eligible to receive M2 funds; and,
WHEREAS, local jurisdictions are required to adopt an annual Expenditure Report as part of one of the eligibility requirements; and,
WHEREAS, local jurisdictions are required to account for Net Revenues, developer/traffic impact fees, and funds expended by local jurisdiction in the Expenditure Report that satisfy the Maintenance of Effort requirements; and, WHEREAS, the Expenditure Report shall include all Net Revenue fund balances, interest earned and expenditures identified by type and program or project; and, WHEREAS, the Expenditure Report must be adopted and submitted to the OCTA each year within six months of the end of the local jurisdiction’s fiscal year to be eligible to receive Net Revenues as part of M2.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LOS ALAMITOS DOES RESOLVE AS FOLLOWS:

SECTION 1. The M2 Expenditure Report is in conformance with the template provided in the Measure M2 Eligibility Guidelines and accounts for Net Revenues including interest earned, expenditures during the fiscal year and balances at the end of fiscal year.

SECTION 2. The M2 Expenditure Report is hereby adopted by the City of Los Alamitos, CA, and included as Exhibit A.

SECTION 3. The City of Los Alamitos Finance Director is hereby authorized to sign and submit the M2 Expenditure Report to OCTA for the fiscal year ending June 30, 2023.

CC RESO 2023-24

PASSED, APPROVED, AND ADOPTED this 20th day of November, 2023.

Tanya Doby, Mayor
ATTEST:

Windmera Quintanar, MMC, City Clerk
APPROVED AS TO FORM:

Michael S. Daudt, City Attorney

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss

CITY OF LOS ALAMITOS )
I, Windmera Quintanar, MMC, City Clerk, of the City of Los Alamitos, do hereby certify that the foregoing Resolution was adopted at a Regular meeting of the City Council held on the 20th day of November 2023, by the following vote, to wit:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

Windmera Quintanar, MMC, City Clerk

City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: November 20, 2023 ITEM NUMBER: 11I
To: Mayor Tanya Doby & Members of the City Council
Presented By: Kain Gallaugher, Captain
Subject: Five-Year Contract with Flock Group, LLC

SUMMARY
The Police Department seeks authorization to extend the contract for the Automated License Plate Reader (ALPR) program for an additional five years, expiring December 31, 2028.

RECOMMENDATION
Enter into a five-year Master Service Agreement with Flock Group, Inc. to lease twelve Automated License Plate Readers for a contract cost of $168,000.

BACKGROUND
Automated License Plate Reader (ALPR) technology has significantly improved over the past several years. License plate information and vehicle-specific data collected, when mined for investigative purposes, have proven invaluable when attempting to identify suspects, witnesses, vehicles associated with AMBER and SILVER Alerts, missing persons, and the efficient monitoring of registered sex offenders. ALPRs also enhance productivity and improve officer safety. Several local police agencies utilizing ALPRs have reported their use has proven to be an invaluable resource.

Since 2021, the City of Los Alamitos has utilized ALPR technology to help combat increased property crimes throughout the City. The City contracted with Flock Group and currently has multiple ALPR cameras stationed at various entry and exit points. Since the installation of this equipment, the Police Department has seen a significant increase in the amount of recovered stolen vehicles and suspects taken into custody, a decrease in vehicle and catalytic converter thefts, and our detective bureau has been able to develop leads in cases which would have otherwise not been discovered without this technology.

DISCUSSION
Since 2021, the City of Los Alamitos has contracted with Flock Group annually to lease ALPR equipment, the Flock Operating System, and an extended data retention plan. Flock Safety has charged a flat rate of $2,500 for equipment and $300 for data retention per camera annually, for a total annual contract price of $33,600. Due to supply chain issues, inflation, and rising costs for Flock to operate its company, Flock has raised the yearly fee of this equipment to $3,000 per camera. This does not effect the current contract the City has with Flock.

However, when the contract is up for renewal in February 2024, the new price of the cameras will increase to $3,000 per camera per year.

To show their appreciation for current customers and to thank them for their loyalty, Flock is offering the option to lock in the City’s current rate of $2,500 per camera per year with a fiveyear contract. This five-year option would continue to be billed one year at a time. This fiveyear contract would co-term with our existing contract, beginning December 31, 2023. This means the five-year contract would begin December 31, 2023, and Flock Safety would prorate the remaining two months of our current contract towards the new five-year agreement.

Based on the success of the ALPR program in our city and the other cities utilizing this technology, there is no belief that this program will end within the next five years. The City will save $30,000 over the next five years by taking advantage of this opportunity.

FISCAL IMPACT
The City already budgets for ALPR services for the amount agreed upon in this five-year contract. Sufficient funds have already been budgeted for in the Special Revenue Fund 51, Police Capital, account 51-525-5420.

Should the City chooses to decline the five-year contract, there will be an additional fiscal impact of $6,000 annually (or $30,000 over the next five years).

Attachment: 1. Flock Group Inc - Law Enforcement Agreement

2. Flock Group Inc (2021)

3. Amend 1 - Flock Group Inc (2023)

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Flock Safety + CA - Los Alamitos PD
Flock Group Inc.
1170 Howell Mill Rd, Suite 210
Atlanta, GA 30318
MAIN CONTACT:

Libby Landers
[email protected]
404-777-4113

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Company Overview
At Flock Safety, technology unites law enforcement and the communities they serve to eliminate crime and shape a safer future, together. We created the first public safety operating system to enable neighborhoods, schools, businesses, and law enforcement to work together to collect visual, audio, and situational evidence across an entire city to solve and prevent crime.

Our connected platform, comprised of License Plate Recognition (LPR), live video, audio detection, and a suite of integrations (AVL, CAD & more), alerts law enforcement when an incident occurs and turns unbiased data into objective answers that increase case clearance, maximize resources, and reduce crime -- all without compromising transparency or human privacy.

Join thousands of agencies reducing crime with Flock Safety’s public safety operating system 2000+ 120 1B+ <60%*
communities with privatepublic partnerships
incident alerts / minute 1B+ vehicles detected /
month
<60% local crime reduction
in Flock cities
*According to a 2019 study conducted by Cobb County Police Department Introduction
Layer Intelligence to Solve More Crime
The pathway to a safer future looks different for every community. As such, this proposal presents a combination of products that specifically addresses your public safety needs, geographical layout, sworn officer count, and budget. These components make up your custom public safety operating system, a connected device network and software platform designed to transform real-time data into a panoramic view of your jurisdiction and help you zero in on the leads that solve more cases, prevent future crimes, and foster trust in the communities you serve.

Software Platform
Flock Safety's out-of-box software platform collects and makes sense of visual, audio, and situational evidence across your entire network of devices.

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Out-of-Box Software Features
Simplified Search Get a complete view of all activity tied to one vehicle in your network of privately and publicly owned cameras.

The user-friendly search experience allows officers to filter hours of footage in seconds based on time, location, and detailed vehicle criteria using patented Vehicle Fingerprint ™ technology. Search filters include:
● Vehicle make
● Body type
● Color
● License plates
○ Partial tags
○ Missing tags
○ Temporary tags
○ State recognition
● Decals
● Bumper stickers
● Back racks
● Top racks
National and Local Sharing Access 1B+ additional plate reads each month without purchasing more cameras. Solve cross-jurisdiction crimes by opting into Flock Safety's sharing networks, including one-toone, national, and statewide search networks. Users can also receive alerts from several external LPR databases:

California SVS
FDLE
FL Expired Licenses
FL Expired Tags
FL Sanctioned Drivers
FL Sex Offenders
Georgia DOR
IL SOS
Illinois Leads
NCIC
NCMEC Amber Alert
REJIS
CCIC
FBI
Real-time Alerts Receive SMS, email, and in-app notifications for custom Hot Lists, NCIC wanted lists, AMBER alerts, Silver alerts, Vehicle Fingerprint matches, and more.

Interactive ESRI Map View your AVL, CAD, traffic, and LPR alerts alongside live onscene video from a single interactive map for a birdseye view of activity in your jurisdiction.

Vehicle Location Analysis Visualize sequential Hot List alerts and the direction of travel to guide officers to find suspect vehicles faster.

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Out-of-Box Software Features (Continued)
Transparency Portal Establish community trust with a public-facing dashboard that shares policies, usage, and public safety outcomes related to your policing technology.

Insights Dashboard Access at-a-glance reporting to easily prove ROI, discover crime and traffic patterns and prioritize changes to your public safety strategy by using data to determine the most significant impact.

Native MDT Application Download FlockOS to your MDTs to ensure officers never miss a Hot List alert while out on patrol.

Hot List Attachments
Attach relevant information to Custom Hot List alerts. Give simple, digestible context to Dispatchers and Patrol Officers responding to Hot List alerts so they can act confidently and drive better outcomes. When you create a custom Hot List Alert, add case notes, photos, reports, and other relevant case information.

Single Sign On (SSO) Increase your login speed and information security with Okta or Azure Single Sign On (SSO). Quickly access critical
information you need to do your job by eliminating the need for password resets and steps in the log-in process.

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Software Add-Ons
Advanced Search Package Unlock more leads and build stronger cases with minimal evidence on the front-end of your investigations with
Advanced Search features:
● Visual Search - Upload any digital image and
transform it into an investigative lead
● Multi-Geo Search - Link a single suspect vehicle to
multiple crimes, even without a vehicle description
or plate number
● Convoy Analysis - Detect suspect vehicles
frequently traveling together to identify
accomplices to serial or organized crimes
Software Integrations
Access real-time incident data in a single ESRI-based map by layering intelligence from your existing data streams into your Flock Safety software experience.
● Computer-Aided Dispatch (CAD) Integration -
Provide your Dispatchers and Patrol Officers with
real-time incident context from 911 calls. Display
CAD events in your Flock Safety Map, including
important incident information like location,
priority, and event type.
● Automatic Vehicle Location (AVL) Integration -
Bring live patrol locations and status into a single
map view, giving dispatchers and patrol officers
more context to deploy resources effectively and
decrease incident response times.

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License Plate Recognition
The Flock Safety Falcon® LPR camera uses Vehicle Fingerprint™ technology to transform hours of footage into actionable evidence, even when a license plate isn't visible, and sends Hot List alerts to law enforcement users when a suspect vehicle is detected. The Falcon has fixed and location-flexible deployment options with 30% more accurate reads than leading LPR.* *Results from the 2019 side-by-side comparison test conducted by LA County Sheriff's Department Flock Safety Falcon®LPR Camera Flock Safety Falcon® Flex Flock Safety Falcon® LR Fixed, infrastructure-free LPR camera
designed for permanent placement.
√ 1 Standard LPR Camera
√ Unlimited LTE data service + Flock OS
platform licenses
√ 1 DOT breakaway pole
√ Dual solar panels
√ Permitting, installation, and ongoing
maintenance
Location-flexible LPR camera designed
for fast, easy self-installation, which is
ideal for your ever-changing
investigative needs.
√ 1 LPR Camera
√ Unlimited LTE data service + software
licenses
√ 1 portable mount with varying-sized
band clamps
√ 1 Charger for internal battery
√ 1 hardshell carrying case
Long-range, high-speed LPR camera
that captures license plates and Vehicle
Fingerprint data for increasing
investigative leads on high-volume
roadways like highways and interstates.
√ 1 Long-Rage LPR Camera
√ Computing device in protective poly
case
√ AC Power
√ Permitting, installation, and ongoing
maintenance

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Your Flock Safety Team
Flock Safety is more than a technology vendor; we are a partner in your mission to build a safer future. We work with thousands of law enforcement agencies across the US to build stronger, safer communities that celebrate the hard work of those who serve and protect. We don’t disappear after contracts are signed; we pride ourselves on becoming an extension of your hard-working team as part of our subscription service.

Implementation Meet with a Solutions Consultant (former LEO) to build a deployment plan based on your needs. Our Permitting Team and Installation Technicians will work to get your device network approved, installed, and activated.

User Training + Support Your designated Customer Success Manager will help train your power users and ensure you maximize the platform,
while our customer support team will assist with needs as they arise.

Maintenance We proactively monitor the health of your device network. If we detect that a device is offline, a full-time technician will service your device for no extra charge.

Note: Ongoing maintenance does not apply to Falcon Flex devices.

Public Relations Government Affairs
Get support educating your stakeholders, including city councils and other governing bodies.

Media Relations
Share crimes solved in the local media with the help of our Public Relations team.

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EXHIBIT A

ORDER FORM
Customer: CA - Los Alamitos PD Initial Term: 60 Months
Legal Entity Name: CA - Los Alamitos PD Renewal Term: 24 Months Accounts Payable Email: [email protected] Payment Terms: Net 30 Address: 3191 Katella Ave Los Alamitos, California Billing Frequency: Annual Plan - First Year Invoiced at Signing. 90720 Retention Period: 365 Days
Hardware and Software Products
Annual recurring amounts over subscription term
Item Cost Quantity Total
Flock Safety Platform $33,600.00
Flock Safety Flock OS
FlockOS ™ Included 1 Included
Flock Safety LPR Products
Flock Safety Falcon ® Included 12 Included
Flock Safety Platform Add Ons
Extended data retention (Up to 1 Year) $300.00 12 $3,600.00 Professional Services and One Time Purchases
Item Cost Quantity Total
One Time Fees
Subtotal Year 1: $33,600.00
Annual Recurring Subtotal: $33,600.00
Discounts: $30,000.00
Estimated Tax: $0.00
Contract Total: $168,000.00

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Billing Schedule
Billing Schedule Amount (USD)
Year 1
At Contract Signing $33,600.00
Annual Recurring after Year 1 $33,600.00
Contract Total $168,000.00
*Tax not included
Discounts
Discounts Applied Amount (USD)
Flock Safety Platform $30,000.00
Flock Safety Add-ons $0.00
Flock Safety Professional Services $0.00

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Product and Services Description
Flock Safety Platform Items Product Description Terms
Flock Safety Falcon ®
An infrastructure-free license plate reader camera that utilizes Vehicle Fingerprint® technology to capture vehicular attributes.

The Term shall commence upon first installation and validation of Flock Hardware.

One-Time Fees Service Description
Installation on existing
infrastructure
One-time Professional Services engagement. Includes site & safety assessment, camera setup & testing, and shipping & handling in accordance with the Flock Safety Advanced Implementation Service Brief.

Professional Services - Standard
Implementation Fee
One-time Professional Services engagement. Includes site and safety assessment, camera setup and testing, and shipping and handling in accordance with the Flock Safety Standard Implementation Service Brief.

Professional Services -
Advanced Implementation Fee
One-time Professional Services engagement. Includes site & safety assessment, camera setup & testing, and shipping & handling in accordance with the Flock Safety Advanced Implementation Service Brief.

FlockOS Features & Description
Package: Essentials
FlockOS Features Description
Community Cameras (Full Access) Access to all privately owned Flock devices within your jurisdiction that have been shared with you.

Unlimited Users Unlimited users for FlockOS
State Network (LP Lookup Only) Allows agencies to look up license plates on all cameras opted in to the statewide Flock network.

Nationwide Network (LP Lookup Only) Allows agencies to look up license plates on all cameras opted in to the nationwide Flock network.

Direct Share - Surrounding Jurisdiction (Full Access) Access to all Flock devices owned by law enforcement that have been directly shared with you. Have ability to search by vehicle fingerprint, receive hot list alerts, and view devices on the map.

Time & Location Based Search Search full, partial, and temporary plates by time at particular device locations License Plate Lookup Look up specific license plate location history captured on Flock devices Vehicle Fingerprint Search Search footage using Vehicle Fingerprint™ technology. Access vehicle type, make, color, license plate state, missing / covered plates, and other unique features like bumper stickers, decals, and roof racks.

Flock Insights/Analytics page Reporting tool to help administrators manage their LPR program with device performance data, user and network audits, plate read reports, hot list alert reports, event logs, and outcome reports.

ESRI Based Map Interface
Flock Safety’s maps are powered by ESRI, which offers the ability for 3D visualization, viewing of floor plans, and layering of external GIS data, such as City infrastructure (i.e., public facilities, transit systems, utilities), Boundary mapping (i.e., precincts, county lines, beat maps), and Interior floor plans (i.e., hospitals, corporate campuses, universities)
Real-Time NCIC Alerts on Flock ALPR Cameras Alert sent when a vehicle entered into the NCIC crime database passes by a Flock camera Unlimited Custom Hot Lists Ability to add a suspect’s license plate to a custom list and get alerted when it passes by a Flock camera

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By executing this Order Form, Customer represents and warrants that it has read and agrees to all of the terms and conditions contained in the Master Services Agreement attached. The Parties have executed this Agreement as of the dates set forth below.

FLOCK GROUP, INC. Customer: CA - Los Alamitos PD
By: By:

Name: Name:

Title: Title:

Date: Date:

PO Number:

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Master Services Agreement
This Master Services Agreement (this “Agreement”) is entered into by and between Flock Group, Inc. with a place of business at 1170 Howell Mill Road NW Suite 210, Atlanta, GA 30318 (“Flock”) and the entity identified in the signature block (“Customer”) (each a “Party,” and together, the “Parties”) on this the 02 day of October 2023. This Agreement is effective on the date of mutual execution (“Effective Date”). Parties will sign an Order Form (“Order Form”) which will describe the Flock Services to be performed and the period for performance, attached hereto as Exhibit A. The Parties agree as follows:

RECITALS
WHEREAS, Flock offers a software and hardware situational awareness solution through Flock’s technology platform that upon detection is capable of capturing audio, video, image, and recording data and provide notifications to Customer (“Notifications”); WHEREAS, Customer desires access to the Flock Services (defined below) on existing devices, provided by Customer, or Flock provided Flock Hardware (as defined below) in order to create, view, search and archive Footage and receive Notifications, via the Flock Services; WHEREAS, Customer shall have access to the Footage in Flock Services. Pursuant to Flock’s standard Retention Period (defined below) Flock deletes all Footage on a rolling thirty (30) day basis, except as otherwise stated on the Order Form. Customer shall be responsible for extracting, downloading and archiving Footage from the Flock Services on its own storage devices; and

AGREEMENT
NOW, THEREFORE, Flock and Customer agree that this Agreement, and any Order Form, purchase orders, statements of work, product addenda, or the like, attached hereto as

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exhibits and incorporated by reference, constitute the complete and exclusive statement of the Agreement of the Parties with respect to the subject matter of this Agreement, and replace and supersede all prior agreements, term sheets, purchase orders, correspondence, oral or written communications and negotiations by and between the Parties.

1. DEFINITIONS
Certain capitalized terms, not otherwise defined herein, have the meanings set forth or crossreferenced in this Section 1.

1.1 “Anonymized Data” means Customer Data permanently stripped of identifying details and any potential personally identifiable information, by commercially available standards which irreversibly alters data in such a way that a data subject (i.e., individual person or entity) can no longer be identified directly or indirectly.

1.2 “Authorized End User(s)” means any individual employees, agents, or contractors of Customer accessing or using the Services, under the rights granted to Customer pursuant to this Agreement.

1.3 “Customer Data” means the data, media and content provided by Customer through the Services. For the avoidance of doubt, the Customer Data will include the Footage.

1.4. “Customer Hardware” means the third-party camera owned or provided by Customer and any other physical elements that interact with the Embedded Software and the Web Interface to provide the Services.

1.5 “Embedded Software” means the Flock proprietary software and/or firmware integrated with or installed on the Flock Hardware or Customer Hardware.

1.6 “Flock Hardware” means the Flock device(s), which may include the pole, clamps, solar panel, installation components, and any other physical elements that interact with the Embedded Software and the Web Interface, to provide the Flock Services as specifically set forth in the applicable product addenda.

1.7 “Flock IP” means the Services, the Embedded Software, and any intellectual property or proprietary information therein or otherwise provided to Customer and/or its Authorized End Users. Flock IP does not include Footage (as defined below).

1.8 “Flock Network End User(s)” means any user of the Flock Services that Customer authorizes access to or receives data from, pursuant to the licenses granted herein.

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1.9 “Flock Services” means the provision of Flock’s software and hardware situational awareness solution, via the Web Interface, for automatic license plate detection, alerts, audio detection, searching image records, video and sharing Footage.

1.10 “Footage” means still images, video, audio and other data captured by the Flock Hardware or Customer Hardware in the course of and provided via the Flock Services.

1.11 “Hotlist(s)” means a digital file containing alphanumeric license plate related information pertaining to vehicles of interest, which may include stolen vehicles, stolen vehicle license plates, vehicles owned or associated with wanted or missing person(s), vehicles suspected of being involved with criminal or terrorist activities, and other legitimate law enforcement purposes.

Hotlist also includes, but is not limited to, national data (i.e., NCIC) for similar categories, license plates associated with AMBER Alerts or Missing Persons/Vulnerable Adult Alerts, and includes manually entered license plate information associated with crimes that have occurred in any local jurisdiction.

1.12 “Installation Services” means the services provided by Flock for installation of Flock Services.

1.13 “Retention Period” means the time period that the Customer Data is stored within the cloud storage, as specified in the Order Form.

1.14 “Vehicle Fingerprint™” means the unique vehicular attributes captured through Services such as: type, make, color, state registration, missing/covered plates, bumper stickers, decals, roof racks, and bike racks.

1.15 “Web Interface” means the website(s) or application(s) through which Customer and its Authorized End Users can access the Services.

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2. SERVICES AND SUPPORT

2.1 Provision of Access. Flock hereby grants to Customer a non-exclusive, non-transferable right to access the features and functions of the Flock Services via the Web Interface during the Term, solely for the Authorized End Users. The Footage will be available for Authorized End Users to access and download via the Web Interface for the data retention time defined on the Order Form (“Retention Period”). Authorized End Users will be required to sign up for an account and select a password and username (“User ID”). Customer shall be responsible for all acts and omissions of Authorized End Users, and any act or omission by an Authorized End User which, including any acts or omissions of authorized End user which would constitute a breach of this agreement if undertaken by customer. Customer shall undertake reasonable efforts to make all Authorized End Users aware of all applicable provisions of this Agreement and shall cause Authorized End Users to comply with such provisions. Flock may use the services of one or more third parties to deliver any part of the Flock Services, (such as using a third party to host the Web Interface for cloud storage or a cell phone provider for wireless cellular coverage).

2.2 Embedded Software License. Flock grants Customer a limited, non-exclusive, nontransferable, non-sublicensable (except to the Authorized End Users), revocable right to use the Embedded Software as it pertains to Flock Services, solely as necessary for Customer to use the Flock Services.

2.3 Support Services. Flock shall monitor the Flock Services, and any applicable device health, in order to improve performance and functionality. Flock will use commercially reasonable efforts to respond to requests for support within seventy-two (72) hours. Flock will provide Customer with reasonable technical and on-site support and maintenance services in-person, via phone or by email at [email protected] (such services collectively referred to as “Support Services”).

2.4 Upgrades to Platform. Flock may make any upgrades to system or platform that it deems necessary or useful to (i) maintain or enhance the quality or delivery of Flock’s products or services to its agencies, the competitive strength of, or market for, Flock’s products or services, such platform or system’s cost efficiency or performance, or (ii) to comply with applicable law.

Parties understand that such upgrades are necessary from time to time and will not diminish the quality of the services or materially change any terms or conditions within this Agreement.

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2.5 Service Interruption. Services may be interrupted in the event that: (a) Flock’s provision of the Services to Customer or any Authorized End User is prohibited by applicable law; (b) any third-party services required for Services are interrupted; (c) if Flock reasonably believe Services are being used for malicious, unlawful, or otherwise unauthorized use; (d) there is a threat or attack on any of the Flock IP by a third party; or (e) scheduled or emergency maintenance (“Service Interruption”). Flock will make commercially reasonable efforts to provide written notice of any Service Interruption to Customer, to provide updates, and to resume providing access to Flock Services as soon as reasonably possible after the event giving rise to the Service Interruption is cured. Flock will have no liability for any damage, liabilities, losses (including any loss of data or profits), or any other consequences that Customer or any Authorized End User may incur as a result of a Service Interruption. To the extent that the Service Interruption is not caused by Customer’s direct actions or by the actions of parties associated with the Customer, the time will be tolled by the duration of the Service Interruption (for any continuous suspension lasting at least one full day). For example, in the event of a Service Interruption lasting five (5) continuous days, Customer will receive a credit for five (5) free days at the end of the Term.

2.6 Service Suspension. Flock may temporarily suspend Customer’s and any Authorized End User’s access to any portion or all of the Flock IP or Flock Service if (a) there is a threat or attack on any of the Flock IP by Customer; (b) Customer’s or any Authorized End User’s use of the Flock IP disrupts or poses a security risk to the Flock IP or any other customer or vendor of Flock; (c) Customer or any Authorized End User is/are using the Flock IP for fraudulent or illegal activities; (d) Customer has violated any term of this provision, including, but not limited to, utilizing Flock Services for anything other than the Permitted Purpose; or (e) any unauthorized access to Flock Services through Customer’s account (“Service Suspension”). Customer shall not be entitled to any remedy for the Service Suspension period, including any reimbursement, tolling, or credit. If the Service Suspension was not caused by Customer, the Term will be tolled by the duration of the Service Suspension.

2.7 Hazardous Conditions. Flock Services do not contemplate hazardous materials, or other hazardous conditions, including, without limit, asbestos, lead, toxic or flammable substances. In the event any such hazardous materials are discovered in the designated locations in which Flock is to perform services under this Agreement, Flock shall have the right to cease work immediately.

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3. CUSTOMER OBLIGATIONS

3.1 Customer Obligations. Flock will assist Customer Authorized End Users in the creation of a User ID. Authorized End Users agree to provide Flock with accurate, complete, and updated registration information. Authorized End Users may not select as their User ID, a name that they do not have the right to use, or any other name with the intent of impersonation. Customer and Authorized End Users may not transfer their account to anyone else without prior written permission of Flock. Authorized End Users shall not share their account username or password information and must protect the security of the username and password. Unless otherwise stated and defined in this Agreement, Customer shall not designate Authorized End Users for persons who are not officers, employees, or agents of Customer. Authorized End Users shall only use Customer-issued email addresses for the creation of their User ID. Customer is responsible for any Authorized End User activity associated with its account. Customer shall ensure that Customer provides Flock with up to date contact information at all times during the Term of this agreement. Customer shall be responsible for obtaining and maintaining any equipment and ancillary services needed to connect to, access or otherwise use the Flock Services. Customer shall (at its own expense) provide Flock with reasonable access and use of Customer facilities and Customer personnel in order to enable Flock to perform Services (such obligations of Customer are collectively defined as “Customer Obligations”).

3.2 Customer Representations and Warranties. Customer represents, covenants, and warrants that Customer shall use Flock Services only in compliance with this Agreement and all applicable laws and regulations, including but not limited to any laws relating to the recording or sharing of data, video, photo, or audio content.

4. DATA USE AND LICENSING

4.1 Customer Data. As between Flock and Customer, all right, title and interest in the Customer Data, belong to and are retained solely by Customer. Customer hereby grants to Flock a limited, non-exclusive, royalty-free, irrevocable, worldwide license to use the Customer Data and perform all acts as may be necessary for Flock to provide the Flock Services to Customer. Flock does not own and shall not sell Customer Data.

4.2 Customer Generated Data. Flock may provide Customer with the opportunity to post, upload, display, publish, distribute, transmit, broadcast, or otherwise make available, messages,

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text, illustrations, files, images, graphics, photos, comments, sounds, music, videos, information, content, ratings, reviews, data, questions, suggestions, or other information or materials produced by Customer (“Customer Generated Data”). Customer shall retain whatever legally cognizable right, title, and interest in Customer Generated Data. Customer understands and acknowledges that Flock has no obligation to monitor or enforce Customer’s intellectual property rights of Customer Generated Data. Customer grants Flock a non-exclusive, irrevocable, worldwide, royalty-free, license to use the Customer Generated Data for the purpose of providing Flock Services. Flock does not own and shall not sell Customer Generated Data.

4.3 Anonymized Data. Flock shall have the right to collect, analyze, and anonymize Customer Data and Customer Generated Data to the extent such anonymization renders the data nonidentifiable to create Anonymized Data to use and perform the Services and related systems and technologies, including the training of machine learning algorithms. Customer hereby grants Flock a non-exclusive, worldwide, perpetual, royalty-free right to use and distribute such Anonymized Data to improve and enhance the Services and for other development, diagnostic and corrective purposes, and other Flock offerings. Parties understand that the aforementioned license is required for continuity of Services. Flock does not own and shall not sell Anonymized Data.

5. CONFIDENTIALITY; DISCLOSURES

5.1 Confidentiality. To the extent required by any applicable public records requests, each Party (the “Receiving Party”) understands that the other Party (the “Disclosing Party”) has disclosed or may disclose business, technical or financial information relating to the Disclosing Party’s business (hereinafter referred to as “Proprietary Information” of the Disclosing Party).

Proprietary Information of Flock includes non-public information regarding features, functionality and performance of the Services. Proprietary Information of Customer includes non-public data provided by Customer to Flock or collected by Flock via Flock Services, which includes but is not limited to geolocation information and environmental data collected by sensors. The Receiving Party agrees: (i) to take the same security precautions to protect against disclosure or unauthorized use of such Proprietary Information that the Party takes with its own proprietary information, but in no event less than commercially reasonable precautions, and (ii) not to use (except in performance of the Services or as otherwise permitted herein) or divulge to any third person any

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such Proprietary Information. The Disclosing Party agrees that the foregoing shall not apply with respect to any information that the Receiving Party can document (a) is or becomes generally available to the public; or (b) was in its possession or known by it prior to receipt from the Disclosing Party; or (c) was rightfully disclosed to it without restriction by a third party; or (d) was independently developed without use of any Proprietary Information of the Disclosing Party.

Nothing in this Agreement will prevent the Receiving Party from disclosing the Proprietary Information pursuant to any subpoena, summons, judicial order or other judicial or governmental process including without limitation responding to requests for records in accordance with the California Public Records Act., provided that the Receiving Party gives the Disclosing Party reasonable prior notice of such disclosure to contest such order. At the termination of this Agreement, all Proprietary Information will be returned to the Disclosing Party, destroyed or erased (if recorded on an erasable storage medium), together with any copies thereof, when no longer needed for the purposes above, or upon request from the Disclosing Party, and in any case upon termination of the Agreement. Notwithstanding any termination, all confidentiality obligations of Proprietary Information that is trade secret shall continue in perpetuity or until such information is no longer trade secret.

5.2 Usage Restrictions on Flock IP. Flock and its licensors retain all right, title and interest in and to the Flock IP and its components, and Customer acknowledges that it neither owns nor acquires any additional rights in and to the foregoing not expressly granted by this Agreement.

Customer further acknowledges that Flock retains the right to use the foregoing for any purpose in Flock’s sole discretion. Customer and Authorized End Users shall not: (i) copy or duplicate any of the Flock IP; (ii) decompile, disassemble, reverse engineer, or otherwise attempt to obtain or perceive the source code from which any software component of any of the Flock IP is compiled or interpreted, or apply any other process or procedure to derive the source code of any software included in the Flock IP; (iii) attempt to modify, alter, tamper with or repair any of the Flock IP, or attempt to create any derivative product from any of the foregoing; (iv) interfere or attempt to interfere in any manner with the functionality or proper working of any of the Flock IP; (v) remove, obscure, or alter any notice of any intellectual property or proprietary right appearing on or contained within the Flock Services or Flock IP; (vi) use the Flock Services for anything other than the Permitted Purpose; or (vii) assign, sublicense, sell, resell, lease, rent, or otherwise transfer, convey, pledge as security, or otherwise encumber, Customer’s rights. There are no implied rights.

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5.3 Disclosure of Footage. Subject to and during the Retention Period, Flock may access, use, preserve and/or disclose the Footage to law enforcement authorities, government officials, and/or third parties, if legally required to do so or if Flock has a good faith belief that such access, use, preservation or disclosure is reasonably necessary to comply with a legal process, enforce this Agreement, or detect, prevent or otherwise address security, privacy, fraud or technical issues, or emergency situations.

6. PAYMENT OF FEES

6.1 Billing and Payment of Fees. Customer shall pay the fees set forth in the applicable Order Form based on the billing structure and payment terms as indicated in the Order Form. If Customer believes that Flock has billed Customer incorrectly, Customer must contact Flock no later than thirty (30) days after the closing date on the first invoice in which the error or problem appeared to receive an adjustment or credit. Customer acknowledges and agrees that a failure to contact Flock within this period will serve as a waiver of any claim. If any undisputed fee is more than thirty (30) days overdue, Flock may, without limiting its other rights and remedies, suspend delivery of its service until such undisputed invoice is paid in full. Flock shall provide at least thirty (30) days’ prior written notice to Customer of the payment delinquency before exercising any suspension right.

6.2 Notice of Changes to Fees. Flock reserves the right to change the fees for subsequent Renewal Terms by providing sixty (60) days’ notice (which may be sent by email) prior to the end of the Initial Term or Renewal Term (as applicable).

6.3 Late Fees. If payment is not issued to Flock by the due date of the invoice, an interest penalty of 1.0% of any unpaid amount may be added for each month or fraction thereafter, until final payment is made.

6.4 Taxes. Customer is responsible for all taxes, levies, or duties, excluding only taxes based on Flock’s net income, imposed by taxing authorities associated with the order. If Flock has the legal obligation to pay or collect taxes, including amount subsequently assessed by a taxing authority, for which Customer is responsible, the appropriate amount shall be invoice to and paid by Customer unless Customer provides Flock a legally sufficient tax exemption certificate and Flock shall not charge customer any taxes from which it is exempt. If any deduction or

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withholding is required by law, Customer shall notify Flock and shall pay Flock any additional amounts necessary to ensure that the net amount that Flock receives, after any deduction and withholding, equals the amount Flock would have received if no deduction or withholding had been required.

7. TERM AND TERMINATION

7.1 Term. The initial term of this Agreement shall be for the period of time set forth on the Order Form (the “Term”). Following the Term, unless otherwise indicated on the Order Form, this Agreement will automatically renew for successive renewal terms of the greater of one year or the length set forth on the Order Form (each, a “Renewal Term”) unless either Party gives the other Party notice of non-renewal at least thirty (30) days prior to the end of the then-current term.

7.2 Termination. Upon termination or expiration of this Agreement, Flock will remove any applicable Flock Hardware at a commercially reasonable time period. In the event of any material breach of this Agreement, the non-breaching Party may terminate this Agreement prior to the end of the Term by giving thirty (30) days prior written notice to the breaching Party; provided, however, that this Agreement will not terminate if the breaching Party has cured the breach prior to the expiration of such thirty (30) day period (“Cure Period”). Either Party may terminate this Agreement (i) upon the institution by or against the other Party of insolvency, receivership or bankruptcy proceedings, (ii) upon the other Party's making an assignment for the benefit of creditors, or (iii) upon the other Party's dissolution or ceasing to do business. In the event of a material breach by Flock, and Flock is unable to cure within the Cure Period, Flock will refund Customer a pro-rata portion of the pre-paid fees for Services not received due to such termination.

7.3 Survival. The following Sections will survive termination: 1, 3, 5, 6, 7, 8.3, 8.4, 9, 11.1 and

11.6.

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8. REMEDY FOR DEFECT; WARRANTY AND DISCLAIMER

8.1 Manufacturer Defect. Upon a malfunction or failure of Flock Hardware or Embedded Software (a “Defect”), Customer must notify Flock’s technical support team. In the event of a Defect, Flock shall make a commercially reasonable attempt to repair or replace the defective Flock Hardware at no additional cost to the Customer. Flock reserves the right, in its sole discretion, to repair or replace such Defect, provided that Flock shall conduct inspection or testing within a commercially reasonable time, but no longer than seven (7) business days after Customer gives notice to Flock.

8.2 Replacements. In the event that Flock Hardware is lost, stolen, or damaged, Customer may request a replacement of Flock Hardware at a fee according to the reinstall fee schedule (https://www.flocksafety.com/reinstall-fee-schedule). In the event that Customer chooses not to replace lost, damaged, or stolen Flock Hardware, Customer understands and agrees that (1) Flock Services will be materially affected, and (2) that Flock shall have no liability to Customer regarding such affected Flock Services, nor shall Customer receive a refund for the lost, damaged, or stolen Flock Hardware.

8.3 Warranty. Flock shall use reasonable efforts consistent with prevailing industry standards to maintain the Services in a manner which minimizes errors and interruptions in the Services and shall perform the Installation Services in a professional and workmanlike manner. Services may be temporarily unavailable for scheduled maintenance or for unscheduled emergency maintenance, either by Flock or by third-party providers, or because of other causes beyond Flock’s reasonable control, but Flock shall use reasonable efforts to provide advance notice in writing or by e-mail of any scheduled service disruption.

8.4 Disclaimer. THE REMEDY DESCRIBED IN SECTION 8.1 ABOVE IS CUSTOMER’S SOLE REMEDY, AND FLOCK’S SOLE LIABILITY, WITH RESPECT TO DEFECTS.

FLOCK DOES NOT WARRANT THAT THE SERVICES WILL BE UNINTERRUPTED OR ERROR FREE; NOR DOES IT MAKE ANY WARRANTY AS TO THE RESULTS THAT MAY BE OBTAINED FROM USE OF THE SERVICES. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION, THE SERVICES ARE PROVIDED “AS IS” AND FLOCK

DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT

LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A

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PARTICULAR PURPOSE AND NON-INFRINGEMENT. THIS DISCLAIMER ONLY

APPLIES TO THE EXTENT ALLOWED BY THE GOVERNING LAW OF THE STATE MENTIONED IN SECTION 11.6.

8.5 Insurance. Flock will maintain commercial general liability policies as stated in Exhibit B.

8.6 Force Majeure. Parties are not responsible or liable for any delays or failures in performance from any cause beyond their control, including, but not limited to acts of God, changes to law or regulations, embargoes, war, terrorist acts, pandemics (including the spread of variants), issues of national security, acts or omissions of third-party technology providers, riots, fires, earthquakes, floods, power blackouts, strikes, supply chain shortages of equipment or supplies, financial institution crisis, weather conditions or acts of hackers, internet service providers or any other third party acts or omissions.

9. LIMITATION OF LIABILITY; INDEMNITY

9.1 Limitation of Liability. NOTWITHSTANDING ANYTHING TO THE CONTRARY,

FLOCK, ITS OFFICERS, AFFILIATES, REPRESENTATIVES, CONTRACTORS AND

EMPLOYEES SHALL NOT BE RESPONSIBLE OR LIABLE WITH RESPECT TO ANY

SUBJECT MATTER OF THIS AGREEMENT OR TERMS AND CONDITIONS RELATED

THERETO UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCT LIABILITY, OR OTHER THEORY: (A) FOR LOSS OF REVENUE, BUSINESS OR BUSINESS INTERRUPTION; (B) INCOMPLETE, CORRUPT, OR INACCURATE DATA; (C) COST OF PROCUREMENT OF SUBSTITUTE GOODS, SERVICES OR TECHNOLOGY; (D)

FOR ANY INDIRECT, EXEMPLARY, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES; (E) FOR ANY MATTER BEYOND FLOCK’S ACTUAL KNOWLEDGE OR

REASONABLE CONTROL INCLUDING REPEAT CRIMINAL ACTIVITY OR INABILITY TO CAPTURE FOOTAGE; OR (F) FOR ANY AMOUNTS THAT, TOGETHER WITH

AMOUNTS ASSOCIATED WITH ALL OTHER CLAIMS, EXCEED THE FEES PAID

AND/OR PAYABLE BY CUSTOMER TO FLOCK FOR THE SERVICES UNDER THIS AGREEMENT IN THE TWELVE (12) MONTHS PRIOR TO THE ACT OR OMISSION THAT

GAVE RISE TO THE LIABILITY, IN EACH CASE, WHETHER OR NOT FLOCK HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS LIMITATION OF

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LIABILITY OF SECTION ONLY APPLIES TO THE EXTENT ALLOWED BY THE GOVERNING LAW OF THE STATE REFERENCED IN SECTION 10.6.

NOTWITHSTANDING ANYTHING TO THE CONTRARY, THE FOREGOING

LIMITATIONS OF LIABILITY SHALL NOT APPLY (I) IN THE EVENT OF GROSS

NEGLIGENCE OR WILLFUL MISCONDUCT, (II) INDEMNIFICATION OBLICATIONS

OR (III) TO TORT CLAIMS FOR BODILY INJURY OR PROPERTY DAMAGE ARISING FROM OR PERTAINING THE PROVISION OF SERVICES UNDER THIS AGREEMENT.

9.2 Responsibility. Each Party to this Agreement shall assume the responsibility and liability for the acts and omissions of its own employees, officers, or agents, in connection with the performance of their official duties under this Agreement. Each Party to this Agreement shall be liable for the torts of its own officers, agents, or employees.

9.3 Flock Indemnity. Flock shall indemnify and hold harmless Customer, its agents and employees, from liability of any kind, including claims, costs (including defense) and expenses, on account of: (i) any copyrighted material, patented or unpatented invention, articles, device or appliance manufactured or used in the performance of this Agreement; or (ii) any damage or injury to property or person directly caused by Flock’s installation of Flock Hardware, except for where such damage or injury was caused solely by the negligence of the Customer or its agents, officers or employees.

10. INSTALLATION SERVICES AND OBLIGATIONS

10.1 Ownership of Hardware. Flock Hardware is owned and shall remain the exclusive property of Flock. Title to any Flock Hardware shall not pass to Customer upon execution of this Agreement, except as otherwise specifically set forth in this Agreement. Except as otherwise expressly stated in this Agreement, Customer is not permitted to remove, reposition, re-install, tamper with, alter, adjust or otherwise take possession or control of Flock Hardware. Customer agrees and understands that in the event Customer is found to engage in any of the foregoing restricted actions, all warranties herein shall be null and void, and this Agreement shall be subject to immediate termination for material breach by Customer. Customer shall not perform any acts which would interfere with the retention of title of the Flock Hardware by Flock. Should Customer default on any payment of the Flock Services, Flock may remove Flock Hardware at

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Flock’s discretion. Such removal, if made by Flock, shall not be deemed a waiver of Flock’s rights to any damages Flock may sustain as a result of Customer’s default and Flock shall have the right to enforce any other legal remedy or right.

10.2 Deployment Plan. Flock shall advise Customer on the location and positioning of the Flock Hardware for optimal product functionality, as conditions and locations allow. Flock will collaborate with Customer to design the strategic geographic mapping of the location(s) and implementation of Flock Hardware to create a deployment plan (“Deployment Plan”). In the event that Flock determines that Flock Hardware will not achieve optimal functionality at a designated location, Flock shall have final discretion to veto a specific location, and will provide alternative options to Customer.

10.3 Changes to Deployment Plan. After installation of Flock Hardware, any subsequent requested changes to the Deployment Plan, including, but not limited to, relocating, repositioning, adjusting of the mounting, removing foliage, replacement, changes to heights of poles will incur a fee according to the reinstall fee schedule located at (https://www.flocksafety.com/reinstall-fee-schedule). Customer will receive prior notice and confirm approval of any such fees.

10.4 Customer Installation Obligations. Customer is responsible for any applicable supplementary cost as described in the Customer Implementation Guide, attached hereto as Exhibit C (“Customer Obligations”). Customer represents and warrants that it has, or shall lawfully obtain, all necessary right title and authority and hereby authorizes Flock to install the Flock Hardware at the designated locations and to make any necessary inspections or maintenance in connection with such installation.

10.5 Flock’s Obligations. Installation of any Flock Hardware shall be installed in a professional manner within a commercially reasonable time from the Effective Date of this Agreement. Upon removal of Flock Hardware, Flock shall restore the location to its original condition, ordinary wear and tear excepted. Flock will continue to monitor the performance of Flock Hardware for the length of the Term. Flock may use a subcontractor or third party to perform certain obligations under this agreement, provided that Flock’s use of such subcontractor or third party shall not release Flock from any duty or liability to fulfill Flock’s obligations under this Agreement.

11. MISCELLANEOUS

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11.1 Compliance With Laws. Parties shall comply with all applicable local, state and federal laws, regulations, policies and ordinances and their associated record retention schedules, including responding to any subpoena request(s).

11.2 Severability. If any provision of this Agreement is found to be unenforceable or invalid, that provision will be limited or eliminated to the minimum extent necessary so that this Agreement will otherwise remain in full force and effect.

11.3 Assignment. This Agreement is not assignable, transferable or sublicensable by either Party, without prior consent. Notwithstanding the foregoing, either Party may assign this Agreement, without the other Party's consent, (i) to any parent, subsidiary, or affiliate entity, or (ii) to any purchaser of all or substantially all of such Party's assets or to any successor by way of merger, consolidation or similar transaction.

11.4 Entire Agreement. This Agreement, together with the Order Form(s), the reinstall fee schedule (https://www.flocksafety.com/reinstall-fee-schedule), and any attached exhibits are the complete and exclusive statement of the mutual understanding of the Parties and supersedes and cancels all previous or contemporaneous negotiations, discussions or agreements, whether written and oral , communications and other understandings relating to the subject matter of this Agreement, and that all waivers and modifications must be in a writing signed by both Parties, except as otherwise provided herein. None of Customer’s purchase orders, authorizations or similar documents will alter the terms of this Agreement, and any such conflicting terms are expressly rejected. Any mutually agreed upon future purchase order is subject to these legal terms and does not alter the rights and obligations under this Agreement, except that future purchase orders may outline additional products, services, quantities and billing terms to be mutually accepted by Parties. In the event of any conflict of terms found in this Agreement or any other terms and conditions, the terms of this Agreement shall prevail. Customer agrees that Customer’s purchase is neither contingent upon the delivery of any future functionality or features nor dependent upon any oral or written comments made by Flock with respect to future functionality or feature.

11.5 Relationship. No agency, partnership, joint venture, or employment is created as a result of this Agreement and Parties do not have any authority of any kind to bind each other in any respect whatsoever. Flock shall at all times be and act as an independent contractor to Customer.

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11.6 Governing Law; Venue. This Agreement shall be governed by the laws of the state in which the Customer is located. The Parties hereto agree that venue would be proper in the chosen courts of the State of which the Customer is located. The Parties agree that the United Nations Convention for the International Sale of Goods is excluded in its entirety from this Agreement.

11.7 Special Terms. Flock may offer certain special terms which are indicated in the proposal and will become part of this Agreement, upon Customer’s prior written consent and the mutual execution by authorized representatives (“Special Terms”). To the extent that any terms of this Agreement are inconsistent or conflict with the Special Terms, the Special Terms shall control.

11.8 Publicity. Flock has the right to reference and use Customer’s name and trademarks and disclose the nature of the Services in business and development and marketing efforts.

11.9 Feedback. If Customer or Authorized End User provides any suggestions, ideas, enhancement requests, feedback, recommendations or other information relating to the subject matter hereunder, Agency or Authorized End User hereby assigns to Flock all right, title and interest (including intellectual property rights) with respect to or resulting from any of the foregoing.

11.10 Export. Customer may not remove or export from the United States or allow the export or re-export of the Flock IP or anything related thereto, or any direct product thereof in violation of any restrictions, laws or regulations of the United States Department of Commerce, the United States Department of Treasury Office of Foreign Assets Control, or any other United States or foreign Customer or authority. As defined in Federal Acquisition Regulation (“FAR”), section

2.101, the Services, the Flock Hardware and Documentation are “commercial items” and according to the Department of Defense Federal Acquisition Regulation (“DFAR”) section 252.2277014(a)(1) and are deemed to be “commercial computer software” and “commercial computer software documentation.” Flock is compliant with FAR Section 889 and does not contract or do business with, use any equipment, system, or service that uses the enumerated banned Chinese telecommunication companies, equipment or services as a substantial or essential component of any system, or as critical technology as part of any Flock system. Consistent with DFAR section 227.7202 and FAR section 12.212, any use, modification, reproduction, release, performance, display, or disclosure of such commercial software or commercial software documentation by the U.S. Government will be governed solely by the terms of this Agreement and will be prohibited except to the extent expressly permitted by the terms of this Agreement.

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11.11 Headings. The headings are merely for organization and should not be construed as adding meaning to the Agreement or interpreting the associated sections.

11.12 Authority. Each of the below signers of this Agreement represent that they understand this Agreement and have the authority to sign on behalf of and bind the Parties they are representing.

11.13 Conflict. In the event there is a conflict between this Agreement and any applicable statement of work, or Customer purchase order, this Agreement controls unless explicitly stated otherwise.

11.14 Morality. In the event Customer or its agents become the subject of an indictment, contempt, scandal, crime of moral turpitude or similar event that would negatively impact or tarnish Flock’s reputation, Flock shall have the option to terminate this Agreement upon prior written notice to Customer.

11.15 Notices. All notices under this Agreement will be in writing and will be deemed to have been duly given when received, if personally delivered; when receipt is electronically confirmed, if transmitted by email; the day after it is sent, if sent for next day delivery by recognized overnight delivery service; and upon receipt to the address listed on the Order Form (or, if different, below), if sent by certified or registered mail, return receipt requested.

11.16 Non-Appropriation. Notwithstanding any other provision of this Agreement, all obligations of the Customer under this Agreement which require the expenditure of funds are conditioned on the availability of funds appropriated for that purpose. Customer shall have the right to terminate this Agreement for non appropriation with thirty (30) days written notice without penalty or other cost.

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FLOCK NOTICES ADDRESS:
1170 HOWELL MILL ROAD, NW SUITE 210
ATLANTA, GA 30318
ATTN: LEGAL DEPARTMENT
EMAIL: [email protected]
Customer NOTICES ADDRESS:

ADDRESS:

ATTN:

EMAIL:

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EXHIBIT B

INSURANCE
Required Coverage. Flock shall procure and maintain for the duration of this Agreement insurance against claims for injuries to persons or damages to property that may arise from or in connection with the performance of the services under this Agreement and the results of that work by Flock or its agents, representatives, employees or subcontractors. Insurance shall be placed with insurers with a current A. M. Best rating of no less than “A” and “VII”. Flock shall obtain and, during the term of this Agreement, shall maintain policies of professional liability (errors and omissions), automobile liability, and general liability insurance for insurable amounts of not less than the limits listed herein. The insurance policies shall provide that the policies shall remain in full force during the life of the Agreement. Flock shall procure and shall maintain during the life of this Agreement Worker's Compensation insurance as required by applicable State law for all Flock employees.

Types and Amounts Required. Flock shall maintain, at minimum, the following insurance coverage for the duration of this Agreement:
(i) Commercial General Liability insurance written on an occurrence basis with minimum limits of One Million Dollars ($1,000,000) per occurrence and Two Million Dollars ($2,000,000) in the aggregate for bodily injury, death, and property damage, including personal injury, contractual liability, independent contractors, broad-form property damage, and product and completed operations coverage;
(ii) Umbrella or Excess Liability insurance written on an occurrence basis with minimum limits of Ten Million Dollars ($10,000,000) per occurrence and Ten Million Dollars ($10,000,000) in the aggregate;
(iii) Professional Liability/Errors and Omissions insurance with minimum limits of Five Million Dollars ($5,000,000) per occurrence and Five Million Dollars ($5,000,000) in the aggregate;
(iv) Commercial Automobile Liability insurance with a minimum combined single limit of One Million Dollars ($1,000,000) per occurrence for bodily injury, death, and property coverage, including owned and non-owned and hired automobile coverage; and

1800308.1
(v) Cyber Liability insurance written on an occurrence basis with minimum limits of Five Million Dollars ($5,000,000).

DocuSign Envelope ID: 115516E5- 4D0D- 4E39- B325- 51 EA5D97948D fH' ock safety
FLOCK GROUP INC.

SERVICES AGREEMENT

ORDER FORM
This Order Form together with the Terms( as defined herein) describe the relationship between Flock Group Inc. (" Flock") and the customer identified below(" Customer")( each of Flock and Customer, a" Party"). This order form(" Order Form") hereby incorporates and includes the" GOVERNMENT AGENCY CUSTOMER AGREEMENT" attached( the" Terms") which describe and set forth the general legal terms governing the relationship( collectively, the" Agreement" ). The Terms contain, among other things, warranty disclaimers, liability limitations and use limitations.

The Agreement will become effective when this Order Form is executed by both Parties( the" Effective Date").

Customer: City of Los Alamitos Contact Name: Wayne Byerley Address:
3191 Katella Ave
Phone: 714- 336- 5533
Los Alamitos, CA. 90720
E- Mail: wbyerley@cityoflosalamitos. org
Expected Payment Method: Billing Contact:
if different than above)
Initial Term: 12 Months Billing Term: Annual payment due Net 30 per terms and Renewal Term: 12 Months conditions
Name Price QTY Subtotal
Includes one- time fees)
Flock Falcon Camera 2, 500. 00 12 30, 000. 00
Implementation Fee ( Public) 250. 00 12 3, 000. 00
Year 1 Total $ 33, 000. 00
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DocuSign Envelope ID: 115516E5- 4D0D- 4E39- B325- 51 EA5D97948D flock safety
Recurring Total: 30000
Special terms:

None
By executing this Order Form, Customer represents and warrants that it has read and agrees all of the terms and conditions contained in the Terms attached. The Parties have executed this Agreement as of the dates set forth below.

City of Los Alamitos
DocuSigned by:
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Mark A7 Byn. 6 .
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Mayor
APPROVED AS TO FORM. ATTEST:

Woodruff, Spradlin & Smart, APC
By.

DocuSigned by: DocuSigned by:

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8/ 19/ 2021
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19 ZOZ1 Michael S. DaudtWindmera Quintanar, MMC /
City Attorney City Clerk
Flock Safety, Inc.

DocuSigned by:
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Langley
Secretary
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DocuSigned by:

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00120A70004DC...
8/ 18/ 2021 Alex Latraverse
Chief Revenue Officer
1613128. 1

DocuSign Envelope ID: 115516E5- 4DOD- 4E39-B325- 51 EA5D97948D fl'ock safety

EXHIBIT A
Statement of Work
Installation of Flock Camera on existing{ pole or Flock- supplied pole if required 1613128. 1

DocuSign Envelope ID: 115516E5- 4D0D- 4E39- B325- 51EA5D97948D ft'ock safety

GOVERNMENT AGENCY CUSTOMER AGREEMENT
This Government Agency Agreement( this" Agreement") is entered into by and between Flock Group, Inc. with a place of business at 1170 Howell Mill Rd NW Suite 210, Atlanta, GA 30318(" Flock") and the police department or government agency identified in the signature block below(" Agency")( each a" Party," and together, the" Parties").

RECITALS
WHEREAS, Flock offers a software and hardware solution for automatic license plate detection through Flock' s technology platform( the" Flock Service"), and upon detection, the Flock Service creates images and recordings of suspect vehicles(" Footage") and can provide notifications to Agency upon the instructions of NonAgency End User(" Notifications"); WHEREAS, Agency desires to purchase, use and/ or have installed access to the Flock Service in order to create, view, search and archive Footage and receive Notifications, including those from non-Agency users ofthe Flock System( where there is an investigative purpose) such as schools, neighborhood homeowners associations, businesses, and individual users;
WHEREAS, except as otherwise required by law, because Footage is stored for no longer than thirty) 30 days in compliance with Flock' s records retention policy, Agency is responsible for extracting, downloading and archiving Footage from the FlockSystem on its own storage devices; and WHEREAS, Flock desires to provide Agency the Flock Service and any access thereto, subject to the terms and conditions of this Agreement, solely for the purpose of crime awareness and prevention by police departments and archiving for evidence gathering(" Purpose").

AGREEMENT
NOW, THEREFORE, Flock and Agency agree as follows and further agree to incorporate the Recitals into this Agreement.

1. DEFINITIONS
Certain capitalized terms, not otherwise defined herein, have the meanings set forth or cross-referenced in this Section 1.

1. " Authorized End User" shall mean any individual employees, agents, or contractors of Agency accessing or using the Flock Services through the Web Interface, under the rights granted to Agency pursuant to this Agreement.

1. 2" Agency Data" will mean the data, media and content provided by Agency through the Flock Services. For the avoidance of doubt, the Agency Data will include the Footage and geolocation information and environmental data collected by sensors built into the Units.

1. 3 " Documentation" will mean text and/ or graphical documentation, whether in electronic or printed format, that describe the features, functions and operation of the Flock Services which are provided by Flock to Agency in accordance with the terms of this Agreement.

1. 4" Embedded Software" will mean the software and/ or firmware embedded or preinstalled on the Hardware.

1. 5" Flock IF"will mean the Flock Services, the Documentation, the Hardware, the Embedded Software, the Installation Services, and any and all intellectual property therein or otherwise provided to Agency and/ or its Authorized End Users in connection with the foregoing.

1. 6" Footage" means still images and/ or video captured by the Hardware in the course of and provided via the Flock Services.
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1. 7" Hardware" shall mean the Flock cameras and any other physical elements that interact with the Embedded Software and the Web Interface to provide the Flock Services. The term" Hardware" excludes the Embedded Software.

1. 8 " Implementation Fee( s)" means the monetary fees associated with the Installation Services, as defined in Section 1. 9 below.

1. 9" Installation Services" means the services provided by Flock regarding the installation, placements and configuration of the Hardware, pursuant to the Statement ofWork attached hereto.

1. 10" Flock Services or Services" means the provision, via the Web Interface, of Flock' s software application for automatic license plate detection, searching image records, and sharing Footage.

1. 11 " Non- Agency End User" means a Flock' s non- Agency customer that has elected to give Agency access to its data in the Flock system.

1. 12 " Non Agency End User Data" means the Footage, geolocation data, environmental data and/ or notifications of a Non-Agency End User.

1. 13" Unit(s)" shall mean the Hardware together with the Embedded Software.

1. 14" Usage Fee" means the subscription fees to be paid by the Agency for ongoing access to Flock Services and Hardware.

1. 15" Support Services" shall mean On-site Services and Monitoring Services, as defined in Section 2. 9 below.

1. 16" Web Interface" means the website( s) or application( s) through which Agency and its Authorized End Users can access the Flock Services in accordance with the terms of this Agreement.

2. FLOCK SERVICES AND SUPPORT

2. 1 Provision of Access. Subject to the terms of this Agreement, Flock hereby grants to Agency a non- exclusive, non-transferable right to access the features and functions of the Flock Services via the Web Interface during the Service Term( as defined in Section 6. 1) and No-Fee Term, solely for the Authorized End Users. The Footage will be available for Agency' s designated administrator, listed on the Order Form, and any Authorized End Users to access via the Web Interface for thirty( 30) days. Authorized End Users will be required to sign up for an account, and select a password and username(" User ID"). Flock will also provide Agency the Documentation to be used in accessing and using the Flock Services. Agency shall be responsible for all acts and omissions of Authorized End Users, and any act or omission by an Authorized End User which, if undertaken by Agency, would constitute a breach ofthis Agreement, shall be deemed a breach of this Agreement by Agency. Agency shall undertake reasonable efforts to make all Authorized End Users aware ofthe provisions of this Agreement as applicable to such Authorized End User' s use of the Flock Services and shall cause Authorized End Users to comply with such provisions. Flock may use the services of one or more third parties to deliver any part of the Flock Services, including without limitation using a third party to host the Web Interface which the Flock Services makes available to Agency and Authorized End Users. Flock will passthrough any warranties that Flock receives from its then current third-party service provider to the extent that such warranties can be provided to Agency. WARRANTIES PROVIDED BY SUCH THIRD PARTIES, ARE

THE AGENCY' S SOLE AND EXCLUSIVE REMEDY ANDFLOCK' S SOLE AND EXCLUSIVE LIABILITY

WITH REGARD TO SUCH THIRD-PARTY SERVICES,
INCLUDING WITHOUT LIMITATION HOSTING THE WEB INTERFACE. To the extent practicable, Agency agrees to comply with any acceptable use policies and other terms of any third-party service provider that are provided or otherwise made available to Agency from time to time.

2. 2 Embedded Software License. Subject to all terms ofthis Agreement, Flock grants Agency a limited, nonexclusive, non- transferable, non- sublicensable( except to the Authorized End Users), revocable right to use the Embedded Software as installed on the Hardware by Flock; in each case, solely as necessary for Agency to use the Flock Services.
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2. 3 Documentation License. Subject to the terms ofthis Agreement, Flock hereby grants to Agency a nonexclusive, non- transferable right and license to use the Documentation during the Service Term in connection with its use of the Flock Services as contemplated herein, and under Section 2. 4, below.

2. 4 Usage Restrictions. The purpose for usage of the Hardware, Documentation, Services, support, and the Flock IP is solely to facilitate gathering evidence that could be used in a lawful criminal investigation by the appropriate government agency and not for tracking activities that the system is not designed to capture(" Permitted Purpose").

Agency will not, and will not permit any Authorized End Users to,( i) copy or duplicate any ofthe Flock IP; (ii) decompile, disassemble, reverse engineer or otherwise attempt to obtain or perceive the source code from which any software component of any of the Flock IP is compiled or interpreted, or apply any other process or procedure to derive the source code of any software included in the Flock IP, or attempt to do any of the foregoing, and Agency acknowledges that nothing in this Agreement will be construed to grant Agency any right to obtain or use such source code;( iii) modify, alter, tamper with or repair any of the Flock IP, or create any derivative product from any of the foregoing, or attempt to do any of the foregoing, except with the prior written consent of Flock;( iv) interfere or attempt to interfere in any manner with the functionality or proper working of any of the Flock IP;( v) remove, obscure, or alter any notice of any intellectual property or proprietary right appearing on or contained within any of the Flock Services or Flock IP;( vi) use the Services, support, Hardware, Documentation or the Flock IP for anything other than the Permitted Purpose; or( vii) assign, sublicense, sell, resell, lease, rent or otherwise transfer or convey, or pledge as security or otherwise encumber, Agency' s rights under Sections 2. 1, 2. 2, or 2. 3.

2. 5 Retained Rights; Ownership. As between the Parties, subject to the rights granted in this Agreement, Flock and its licensors retain all right, title and interest in and to the Flock IP and its components, and Agency acknowledges that it neither owns nor acquires any additional rights in and to the foregoing not expressly granted by this Agreement. Agency further acknowledges that Flock retains the right to use the foregoing for any purpose in Flock' s sole discretion. There are no implied rights.

2.6 Suspension. Notwithstanding anything to the contrary in this Agreement, Flock may temporarily suspend Agency' s and any Authorized End User' s access to any portion or all ofthe Flock IP if(i) Flock reasonably determines that( a) there is a threat or attack on any of the Flock IP;( b) Agency' s or any Authorized End User' s use of the Flock Service disrupts or poses a security risk to the Flock Service or any other customer or vendor of Flock; c) Agency or any Authorized End User is/ are using the Flock IP for fraudulent or illegal activities;( d) Flock' s provision of the Flock Services to Agency or any Authorized End User is prohibited by applicable law;( e) any vendor of Flock has suspended or terminated Flock' s access to or use of any third party services or products required to enable Agency to access the Flock IP; or( f)Agency has violated any term ofthis provision, including, but not limited to, utilizing the Flock Services for anything other than the Permitted Purpose( each such suspension, in accordance with this Section 2. 6, a" Service Suspension"). Flock will make commercially reasonable efforts, circumstances permitting, to provide written notice of any Service Suspension to Agency( including notices sent to Flock' s registered email address) and to provide updates regarding resumption of access to the Flock IP following any Service Suspension. Flock will use commercially reasonable efforts to resume providing access to the Flock Service as soon as reasonably possible after the event giving rise to the Service Suspension is cured. Flock will have no liability for any damage, liabilities, losses( including any loss of data or profits) or any other consequences that Agency or any Authorized End User may incur as a result of a Service Suspension. To the extent that the Service Suspension is not caused by Agency' s direct actions or by the actions of parties associated with the Agency, the expiration ofthe Term will be tolled by the duration of any suspension( for any continuous suspension lasting at least one full day).

2. 7 Installation Services.

2. 7. 1 Designated Locations. Prior to performing the physical installation of the Units, Flock shall advise Agency on the location and positioning ofthe Units for optimal license plate image capture, as conditions and location allow. While Flock will provide advice regarding the location and positioning of sch Unit, Agency will have the ultimate decision regarding the location, position and angle ofthe Units( each Unit location so designated by Agency, a" Designated Location"). Flock shall have no liability to Agency resulting from any poor performance, functionality or Footage resulting from or otherwise relating to the Designated Locations or delay in installation due to Agency' s delay in identifying the choices for the Designated Locations, in ordering and/ or having the Designated Location ready for installation including having all electrical work preinstalled and permits ready. Designated Locations that are suggested by Flock and accepted by Agency without alteration will be known as Flock Designated Locations. After a deployment plan with Designated Locations
1613128. 1

DocuSign Envelope ID: 115516E5- 4D0D- 4E39- B325- 51 EA5D97948D fl'ock safety
and equipment has been agreed upon by both Flock and the Agency, any subsequent changes to the deployment plan Reinstalls") driven by Agency' s request will incur a charge for Flock' s then- current list price for Reinstalls, as listed in the then- current Reinstall Policy ( available at https:// www.flocksafety. com/ reinstall- fee- schedule) and any equipment charges. These changes include but are not limited to camera re- positioning, adjusting of cameramounting, re- angling, removing foliage, camera replacement, changes to heights of poles, regardless of whether the need for Reinstalls related to vandalism, weather, theft, lack of criminal activity in view, and the like.

2. 7. 2 Agency' s Installation Obligations. Agency agrees to allow Flock and its agents reasonable access in and near the Designated Locations at all reasonable times upon reasonable notice for the purpose of performing the installation work, the" Agency Installation Obligations" include, to the extent required by the deployment plan, but are not limited to electrical work to provide a reliable source of 120V AC power that follow Flock guidelines and comply with local regulations if adequate solar exposure is not available. Agency is solely responsible for( i) any permits or associated costs, and managing the permitting process; ( ii) any federal, state or local taxes including property, license, privilege, sales, use, excise, gross receipts or other similar taxes which may now or hereafter become applicable to, measured by or imposed upon or with respect to the installation of the Hardware, its use, or iii) any other services performed in connection with installation ofthe Hardware. Flock will provide options to supply power at each Designated Location. If Agency refuses alternative power supply options, Agency agrees and understands that Agency will not be subject to any reimbursement, tolling, or credit for any suspension period of Flock Services due to low solar. Flock will make all reasonable efforts within their control to minimize suspensionof Flock Services. Any fees payable to Flock exclude the foregoing. Without being obligated or taking any responsibility for the foregoing, Flock may pay and invoice related costs to Agency ifAgency did not address them prior to the execution ofthis Agreement or a third party requires Flock to pay. Agency represents and warrants that it has all necessary right title and authority and hereby authorizes Flock to install the Hardware at the Designated Locations and to make any necessary inspections or tests in connection with such installation.

2. 7. 3 Flock' s Installation Obligations. The Hardware shall be installed in a workmanlike manner in accordance with Flock' s standard installation procedures, and the installation will be completed within a reasonable time from the time that the Designated Locations are selected by Agency. Following the initial installation of the Hardware and any subsequent Reinstalls or maintenance operations, Flock' s obligation to perform installation work shall cease; however, Flock will continue to monitor the performance of the Units for the length of the Term and will receive access to the Footage for a period of three( 3) business days after the initial installation in order to monitor performance and provide any necessary maintenance solely as a measure of quality control. Agency can opt out of Flock' s access to Footage after the initial installation which would waive Flock' s responsibility to ensure such action was successful. Agency understands and agrees that the Flock Services will not function without the Hardware. Labor may be provided by Flock or a third party.

2. 7. 4 Security Interest. The Hardware shall remain the personal property of Flock and will be removed upon the termination or expiration of this Agreement. Agency agrees to perform all acts which may be necessary to assure the retention of title of the Hardware by Flock. Should Agency default in any payment for the Flock Services or any part thereof or offer to sell or auction the Hardware, then Agency authorizes and empowers Flock to remove the Hardware or any part thereof. Such removal, if made by Flock, shall not be deemed a waiver ofFlock' s rights to any damages Flock may sustain as a result of Agency' s default and Flock shall have the right to enforce any other legal remedy or right.

2. 8 Hazardous Conditions. Unless otherwise stated in the Agreement, Flock' s price for its services under this Agreement does not contemplate work in any areas that contain hazardous materials, or other hazardous conditions, including, without limit, asbestos, lead, toxic or flammable substances. In the event any such hazardous materials are discovered in the designated locations in which Flock is to perform services under this Agreement, Flock shall have the right to cease work immediately in the area affected until such materials are removed or rendered harmless.

Any additional expenses incurred by Flock as a result of the discovery or presence of hazardous material or hazardous conditions shall be the responsibility ofAgency and shall be paid promptly upon billing.

2. 9 Support Services. Subject to the payment offees, Flock shall monitor the performance and functionality of Flock Services and may, from time to time, advise Agency on changes to the Flock Services, Installation Services, or the Designated Locations which may improve the performance or functionality ofthe Services or may improve the quality ofthe Footage. The work, its timing, and the fees payable relating to such work shall be agreed by the Parties prior to any alterations to or changes of the Services or the Designated Locations(" Monitoring Services"). Subject to the terms hereof, Flock will provide Agency with reasonable technical and on- site support and maintenance 1613128. 1

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services(" On-Site Services") in- person or by email at [email protected]. Flock will use commercially reasonable efforts to respond to requests for support.

2. 10 Changes to Platform. Flock Safety may, in its sole discretion, make any changes to any system or platform that it deems necessary or useful to( i) maintain or enhance( a) the quality or delivery of Flock Safety' s products or services to its customers,( b) the competitive strength of,or market for, Flock Safety' s products or services,( c) such platform or system' s cost efficiency or performance, or( ii) to comply with applicable law.

3. AGENCY RESTRICTIONS AND RESPONSIBILITIES

3. 1 Agency Obligations. Upon creation of a User ID, Agency agrees to provide Flock with accurate, complete, and updated registration information. Agency may not select as its User ID a name that Agency does not have the right to use, or another person' s name with the intent to impersonate that person. Agency may not transfer its account to anyone else without prior written permission of Flock. Agency will not share its account or password with anyone, and must protect the security of its account and password. Agency is responsible for any activity associated with its account. Agency shall be responsible for obtaining and maintaining any equipment and ancillary services needed to connect to, access or otherwise use the Services. Agency will, at its own expense, provide assistance to Flock, including, but not limited to, by means of access to, and use of, Agency facilities, as well as by means of assistance from Agency personnel, to the limited extent any of the foregoing may be reasonably necessary to enable Flock to perform its obligations hereunder, including, without limitation, any obligations with respect to Support Services or any Installation Services.

3. 2 Agency Representations and Warranties. Agency represents, covenants, and warrants that Agency will use the Services only in compliance with this Agreement and all applicable laws and regulations, including but not limited to any laws relating to the recording or sharing of video, photo, or audio content and retention thereof. Although Flock has no obligation to monitor Agency' s use ofthe Services, Flock may do so and may prohibit any use ofthe Services it believes may be( or alleged to be) in violation of the foregoing.

4. CONFIDENTIALITY; AGENCY DATA; NON- AGENCY DATA

4. 1 Confidentiality. Each Party( the" Receiving Party") understands that the other Party( the" Disclosing Party") has disclosed or may disclose business, technical or financial information relating to the Disclosing Party' s business hereinafter referred to as" Proprietary Information" ofthe Disclosing Party). Proprietary Information of Flock is non- public information including but not limited to features, functionality, designs, user interfaces, trade secrets, intellectual property, business plans, marketing plans, works of authorship, hardware, customer lists and requirements, and performance of the Flock Services. Proprietary Information of Agency includes non- public Agency Data, Non- Agency End User Data, and data provided by Agency or a Non- Agency End User to Flock or collected by Flock via the Unit, including the Footage, to enable the provision ofthe Services. The Receiving Party shall not disclose, use, transmit, inform or make available to any entity, person or body any of the Proprietary Information, except as a necessary part of performing its obligations hereunder, and shall take all such actions as are reasonably necessary and appropriate to preserve and protect the Proprietary Information and the parties' respective rights therein, at all times exercising at least a reasonable level of care. Each party agrees to restrict access to the Proprietary Information ofthe other party to those employees or agents who require access in order to perform 1613128. 1 Page 170 of 672
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hereunder. The Receiving Party agrees:( i) to take the same security precautions to protect against disclosure or unauthorized use of such Proprietary Information that the party takes with its own proprietary information, but in no event will a party apply less than reasonable precautions to protect such Proprietary Information, and( ii) not to use except in performance ofthe Services or as otherwise permitted herein) or divulge to any third person any such Proprietary Information. Flock' s use of the Proprietary Information may include processing the Proprietary Information to send Agency Notifications or alerts, such as when a car exits Agency' s neighborhood, or to analyze the data collected to identify motion or other events.

The Disclosing Party agrees that the foregoing shall not apply with respect to any information that the Receiving Party can document( a) is or becomes generally available to the public, or( b) was in its possession or known by Receiving Party prior to receipt from the Disclosing Party, or( c) was rightfully disclosed to Receiving Party without restriction by a third party, or( d) was independently developed without use of any Proprietary Information ofthe Disclosing Party.

Nothing in this Agreement will prevent the Receiving Party from disclosing the Proprietary Information pursuant to any subpoena, summons, judicial order or otherjudicial or governmental process including without limitation responding to requests for records in accordance with the California Public Records Act, provided that the Receiving Party gives the Disclosing Party reasonable prior notice of such disclosure to obtain— at the Disclosing Party' s sole cost and expense— a protective order or otherwise opposethe disclosure. For clarity, Flock may access, use, preserve and/ or disclose the Footage to law enforcement authorities, government officials, and/ or third parties, iflegally required to do so or ifFlock has a good faith belief that such access, use, preservation or disclosure is reasonably necessary to: ( a) comply with a legal process or request;( b) enforce this Agreement, including investigation of any potential violation thereof;( c) detect, prevent or otherwise address security, fraud or technical issues; or( d) protect the rights, property or safety of Flock, its users, a third party, or the public as required or permitted by law, including respond to an emergency situation. Having received notice prior to data being deleted, Flock may store Footage in order to comply with a valid court order but such retained Footage will not be retrievable without a valid court order.

4. 2 Agency and Non- Agency End User Data. As between Flock and Agency, all right, title and interest in the Agency Data and Non-Agency End User Data, belong to and are retained solely by Agency. Agency hereby grants to Flock a limited, non-exclusive, royalty-free, worldwide license to use the Agency Data and Non-Agency End User Data and perform all acts with respect to the Agency Data and Non-Agency End User Data as may be necessary for Flock to provide the Flock Services to Agency, including without limitation the Support Services set forth in Section 2. 9 above, and a non- exclusive, perpetual, irrevocable, worldwide, royalty- free, fully paid license to use, reproduce, modify and distribute the Agency Data and Non- Agency End User Data as a part of the Aggregated Data( as defined in Section 4. 4 below). As between Flock and Agency, Agency is solely responsible for the accuracy, quality, integrity, legality, reliability, and appropriateness of all Agency Data and Non-Agency End User Data. As between Agency and Non- Agency End Users that have prescribed access of Footage to Agency, each of Agency and Non-Agency End Users will share all right, title and interest in the Non-Agency End User Data. This Agreement does not by itself make any Non- Agency End User Data the sole property or the Proprietary Information of Agency. Flock will automatically delete Footage older than thirty( 30) days. Agency has a thirty( 30) day window to view, save and/ or transmit Footage to the relevant government agency prior to its deletion.

4. 3 Feedback. IfAgency provides any suggestions, ideas, enhancement requests, feedback, recommendations or other information relating to the subject matter hereunder, Agency hereby assigns( and will cause its agents and representatives to assign) to Flock all right, title and interest( including intellectual property rights) with respect to or resulting from any of the foregoing.

4.4 Aggregated Data. Notwithstanding anything in this Agreement to the contrary, Flock shall have the right to collect and analyze data that does not refer to or identify Agency or any individuals or de- identifies such data and other information relating to the provision, use and performance of various aspects of the Services and related systems and technologies( including, without limitation, information concerning Agency Data and data derived therefrom). For the sake of clarity, Aggregated Data is compiled anonymous data which has been stripped of any personal identifying information. Agency acknowledges that Flock will be compiling anonymized and/ or aggregated data based on Agency Data and Non- Agency End User Data input into the Services( the" Aggregated Data"). Agency hereby grants Flock a non- exclusive, worldwide, perpetual, royalty- free right and license( during and after the Service Term hereof) to( i) use and distribute such Aggregated Data to improve and enhance the Services and for other marketing, development, diagnostic and corrective purposes, other Flock offerings, and crime prevention efforts, and( ii) disclose the Agency Data and Non- Agency End User Data( both inclusive of any Footage) to enable law enforcement monitoring against law enforcement hotlists as well as provide Footage search 1613128. 1 Page 171 of 672
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access to law enforcement for investigative purposes only. No rights or licenses are granted except as expressly set forth herein.

5. PAYMENT OF FEES

5. 1 Fees. Agency will pay Flock the first Usage Fee, the Implementation Fee and any fee for Hardware( as described on the Order Form, together the" Initial Fees") as set forth on the Order Form on or before the 7th day following the Effective Date of this Agreement. Flock is not obligated to commence the Installation Services unless and until the Initial Fees have been made and shall have no liability resulting from any delay related thereto. Agency shall pay the ongoing Usage Fees set forth on the Order Form with such Usage Fees due and payable thirty( 30) days in advance of each payment period. All payments will be made by either ACH, check, or credit card. The first month of Flock Services corresponding to the first Usage Fee payment will begin upon the first installation of Hardware.

For Agencies who purchase ten( 10) or more Units, in the event that only a portion of the Units are installed at the first installation with additional Units to be installed at a later date, Usage Fees shall be calculated on a pro rata basis corresponding to the then- installed Units. Agencies will be invoiced for the additional Units immediately upon installation ofthe remaining Units.

5. 2 Changes to Fees. Flock reserves the right to change the Fees or applicable charges and to institute new charges and Fees at the end ofthe Initial Term or any Renewal Term, upon sixty( 60) days' notice prior to the end of such Initial Term or Renewal Term( as applicable) to Agency( which may be sent by email). If Agency believes that Flock has billed Agency incorrectly, Agency must contact Flock no later than sixty( 60) days after the closing date on the first billing statement in which the error or problem appeared, in order to receive an adjustment or credit.

Inquiries should be directed to Flock' s customer support department. Agency acknowledges and agrees that a failure to contact Flock within this sixty( 60) day period will serve as a waiver of any claim Agency may have had as a result of such billing error.

5. 3 Invoicing, Late Fees; Taxes. Flock may choose to bill through an invoice, in which case, full payment for invoices issued in any given month must be received by Flock thirty( 30) days after the mailing date ofthe invoice.

Unpaid amounts are subject to a finance charge of 1. 5% per month on any outstanding balance, or the maximum permitted by law, whichever is lower, plus all expenses of collection, and may result in immediate termination of Service. To the extent allowable by law or Agency regulations pertaining to tax- exempt entities, Agency shall be responsible for all taxes associated with Services other than U.S. taxes based on Flock' s net income.

5. 4 No-Fee Term Access. Subject to Flock' s record retention policy, Flock offers complimentary access to the Flock System for thirty( 30) days(" No Fee Term") to Agency when Non- Agency End Users intentionally prescribe access or judicial orders mandate access to Non- Agency End User Data. Agency agrees to pay the Initial Fees and Usage Fees according to Section 5. 1 and will receive Flock' s complimentary access to the Flock Service and Footage for no additional cost. Should such access cause Flock to incur internal or out- of-pocket costs that are solely the result ofthe access, Flock reserves the right to invoice these costs to Agency under Section 5. 3 and Agency agrees to pay them. The complimentary No- Fee Term access to Flock Services shall survive the expiration or termination of this Agreement for five( 5) years unless Agency provides written notice of the intent to cancel access to Flock Services.

6. TERM AND TERMINATION

6. 1 Term. Subject to earlier termination as provided below, the initial term of this Agreement shall be for the period of time set forth on the Order Form( the" Initial Term"). Following the Initial Term, unless otherwise indicated on the Order Form, this Agreement will automatically renew for successive renewal terms for the greater of one year and the length set forth on the Order Form( each, a" Renewal Term", and together with the Initial Term, the Service Term") unless either party gives the other party notice of non- renewal at least thirty( 30) days prior to the end of the then- current term.

6. 2 Agency Satisfaction Guarantee. At any time during the agreed upon term, an Agency not fully satisfied with the service or solution may self-elect to terminate their contract. Self-elected termination will result in a one- time fee of actual cost of removal and labor, said cost not to exceed$ 500 per camera. Upon self-elected termination, a refund will be provided, prorated for any fees paid for the remaining Term length set forth previously. Self-termination of 1613128. 1 Page 172 of 672
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the contract by the Agency will be effective immediately. Flock will remove all equipment at Flock' s own convenience, within a commercially reasonable period upon termination. Advance written notice will be provided.

6. 3 Termination. In the event of any material breach of this Agreement, the non- breaching party may terminate this Agreement prior to the end ofthe Service Term by giving thirty( 30) days prior written notice to the breaching party; provided, however, that this Agreement will not terminate ifthe breaching party has cured the breach prior to the expiration of such thirty-day period. Either party may terminate this Agreement, without notice,( i) upon the institution by or against the other party of insolvency, receivership or bankruptcy proceedings,( ii) upon the other party' s making an assignment for the benefit of creditors, or( iii) upon the other party' s dissolution or ceasing to do business. Upon termination for Flock' s material breach, Flock will refund to Agency a pro- rata portion of the prepaid Fees for Services not received due to such termination.

6.4 Effect of Termination. Upon any termination ofthe Service Term, Flock will collect all Units, delete all Agency Data, terminate Agency' s right to access or use any Services, and all licenses granted by Flock hereunder will immediately cease. Agency shall ensure that Flock is granted access to collect all Units and shall ensure that Flock personnel does not encounter Hazardous Conditions in the collection of such units. Upon termination of this Agreement, Agency will immediately cease all use of Flock Services.

6. 5 No- Fee Term. The initial No- Fee Term will extend, after entering into this Agreement, for thirty( 30) days from the date a Non- Agency End User grants access to their Footage and/ or Notifications. In expectation of repeated noncontinuous No-Fee Terms, Flock may in its sole discretion leave access open for Agency' s Authorized End Users despite there not being any current Non-Agency End User authorizations. Such access and successive No-Fee Terms are deemed to be part of the No- Fee Term. Flock, in its sole discretion, can determine not to provide additional No- Fee Terms or can impose a price per No- Fee Term upon thirty( 30) days' notice. Agency may terminate any No- Fee Term or access to future No- Fee Terms upon 30 days' notice.

6. 6 Survival. The following Sections will survive termination: 2. 4, 2. 5, 3, 4, 5( with respect to any accrued rights to payment), 5. 4, 6. 5, 7.4, 8. 1, 8. 2, 8. 3, 8.4, 9. 1 and 10. 5.

7. REMEDY; WARRANTY AND DISCLAIMER

7. 1 Remedy. Upon a malfunction or failure of Hardware or Embedded Software( a" Defect"), Agency must first make commercially reasonable efforts to address the problem by contacting Flock' s technical support as described in Section 2. 9 above. If such efforts do not correct the Defect, Flock shall, or shall instruct one of its contractors to repair or replace the Hardware or Embedded Software suffering from the Defect. Flock reserves the right in their sole discretion to refuse or delay replacement or its choice of remedy for a Defect until after it has inspected and tested the affected Unit provided that such inspection and test shall occur within seventy-two( 72) hours after Agency notifies the Flock of a Defect. In the event of a Defect, Flock will repair or replace the defective Unit at no additional cost. In the event that a Unit is lost, stolen, or damaged, Flock agrees to replace the Unit at a fee according to the then- current Reinstall Policy( https:// www. flocksafety. com/ reinstall- fee- schedule). Agency shall not be required to replace subsequently lost, damaged or stolen Units, however, Agency understands and agrees that functionality, including Footage, will be materially affected due to such subsequently lost, damaged or stolen units and that Flock will have no liability to Agency regarding such affected functionality nor shall the Usage Fee or Implementation Fees owed be impacted.

7. 2 Exclusions. Flock will not provide the remedy described in Section 7. 1 above if any of the following exclusions apply:( a) misuse of the Hardware or Embedded Software in any manner, including operation of the Hardware or Embedded Software in any way that does not strictly comply with any applicable specifications, documentation, or other restrictions on use provided by Flock;( b) damage, alteration, or modification of the Hardware or Embedded Software in any way; or( c) combination of the Hardware or Embedded Software with software, hardware or other technology that was not expressly authorized by Flock.

7. 3 Warranty. Flock shall use reasonable efforts consistent with prevailing industry standards to maintain the Services in a manner which minimizes errors and interruptions in the Services and shall perform the Installation Services in a professional and workmanlike manner. Upon completion of any installation or repair, Flock shall clean and leave the area in good condition. Services may be temporarily unavailable for scheduled maintenance or for unscheduled emergency maintenance, either by Flock or by third-party providers, or because of other causes beyond 1613128. 1 Page 173 of 672
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Flock' s reasonable control, but Flock shall use reasonable efforts to provide advance notice in writing or by e- mail of any scheduled service disruption.

7. 4 Disclaimer. THE REMEDY DESCRIBED IN SECTION 7. 1 ABOVE IS AGENCY' S SOLE REMEDY, AND

FLOCK' S SOLE LIABILITY, WITH RESPECT TO DEFECTIVE HARDWARE AND/ OR EMBEDDED SOFTWARE. THE FLOCK DOES NOT WARRANT THAT THE SERVICES WILL BE UNINTERRUPTED OR ERROR FREE; NOR DOES IT MAKE ANY WARRANTY AS TO THE RESULTS THAT MAY BE OBTAINED FROM USE OF THE SERVICES. THIS DISCLAIMER OF SECTION 7. 4 ONLY APPLIES TO THE EXTENT ALLOWED BY THE GOVERNING LAW OF THE STATE OF CALIFORNIA.

7. 5 Insurance. Flock agrees to maintain insurance that meets the following requirements:.

Without limiting Flock' s indemnification ofAGENCY, and prior to commencement of the Installation Services, Flock shall obtain, provide and maintain at its own expense during the term ofthis AGREEMENT, policies of insurance ofthe type and amounts described below and in a form that is satisfactory to AGENCY.

General liability insurance. Flock shall maintain commercial general liability insurance with coverage at least as broad as Insurance Services Office form CG 00 01. in an amount not less than$ 1, 000, 000 per occurrence, 2, 000, 000 general aggregate, for bodily injury, personal injury, and property damage. The policy must include contractual liability that has not been amended. Any endorsement restricting standard TSO " insured contract" language will not be accepted.

Automobile liability insurance. Flock shall maintain automobile insurance at least as broad as Insurance Services Office form CA 00 01 covering bodily injury and property damage for all activities of the Flock arising out of or in connection with the Installation Services and Flock Services to be performed under this AGREEMENT, including coverage for any owned, hired, non- owned or rented vehicles, in an amount not less than$ 1, 000, 000 combined single limit for each accident.

Umbrella or excess liability insurance. Flock shall obtain and maintain an umbrella or excess liability insurance policy with limits that will provide bodily injury, personal injury and property damage liability coverage at least as broad as the primary coverages set forth above, including commercial general liability, automobile liability, and employer' s liability. Such policy or policies shall include the following terms and conditions:

A drop down feature requiring the policy to respond if any primary insurance that would otherwise have applied proves to be uncollectible in whole or in part for any reason; Pay on behalf of wording as opposed to reimbursement;
Concurrency of effective dates with primary policies;
Policies shall" follow form" to the underlying primary policies; and Insureds under primary policies shall also be insureds under the umbrella or excess policies.

Workers' compensation insurance. Flock shall maintain Workers' Compensation Insurance Statutory Limits) and Employer's Liability Insurance( with limits of at least$ 1, 000, 000).

Prior to commencement of the Installation Services, Flock shall submit to AGENCY, along with the certificate of insurance, a Waiver of Subrogation endorsement in favor of AGENCY, its officers, agents, employees and volunteers.

Other provisions or requirements
Proof of insurance. Flock shall provide certificates of insurance to AGENCY as evidence of the insurance coverage required herein, along with a waiver of subrogation endorsement for workers' compensation. Insurance certificates and endorsements must be approved by AGENCY' s Risk Manager prior to commencement of the Installation Services. Current certification of insurance shall be kept on file with AGENCY at all times during the term of this contract. AGENCY reserves the right to require complete, certified copies of all required insurance policies, at any time.

Duration of coverage. Flock shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property, which may arise from or in connection with the performance of the Installation Services or Flock Services hereunder by Flock, his agents, representatives, employees or 1613128. 1

DocuSign Envelope ID: 115516E5- 4D0D- 4E39- B325- 51EA5D97948D fH'ock safety
subconsultants.

Primary/ noncontributing. Coverage provided by Flock shall be primary and any insurance or selfinsurance procured or maintained by AGENCY shall not be required to contribute with it. The limits of insurance required herein may be satisfied by a combination of primary and umbrella or excess insurance. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and non- contributory basis for the benefit of AGENCY before the AGENCY' s own insurance or selfinsurance shall be called upon to protect it as a named insured.

Agency' s rights of enforcement. In the event any policy of insurance required under this AGREEMENT does not comply with these specifications 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 Flock or AGENCY will withhold amounts sufficient to pay premium from Flock payments. In the alternative, AGENC Y may cancel this AGREEMENT.

Acceptable insurers. All insurance policies shall be issued by an insurance company currently authorized by the Insurance Commissioner to transact business of insurance or is on the List of Approved Surplus Line Insurers in the State of California, with an assigned policyholders' Rating of A-( or higher) and Financial Size Category Class VII ( or larger) in accordance with the latest edition of Best' s Key Rating Guide, unless otherwise approved by the AGENCY' s Risk Manager.

Waiver of subrogation. All insurance coverage maintained or procured pursuant to this AGREEMENT shall be endorsed to waive subrogation against AGENCY, its elected or appointed officers, agents, officials, employees and volunteers or shall specifically allow Flock or others providing insurance evidence in compliance with these specifications to waive their right of recovery prior to a loss. Flock hereby waives its own right of recovery against AGENCY, and shall require similar written express waivers and insurance clauses from each of its subconsultants.

Enforcement of contract provisions( non estoppel). Flock acknowledges and agrees that any actual or alleged failure on the part of the AGENCY to inform Flock of non- compliance with any requirement imposes no additional obligations on the AGENCY nor does it waive any rights hereunder.

Requirements not limiting. 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 as it pertains to a given issue and is not intended by any party or insured to be all inclusive, or to the exclusion of other coverage, or a waiver of any type. If the Flock maintains higher limits than the minimums shown above, the AGENCY requires and shall be entitled to coverage for the higher limits maintained by the Flock. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the AGENCY.

Notice of cancellation. Flock agrees to oblige its insurance agent or broker and insurers to provide to AGENCY with a thirty( 30) day notice of cancellation( except for nonpayment for which a ten( 10) day notice is required) or nonrenewal of coverage for each required coverage.

Additional insured status. General liability policies shall provide or be endorsed to provide that AGENCY and its officers, officials, employees, and agents shall be additional insureds under such policies. This provision shall also apply to any excess/ umbrella liability policies.

Prohibition of undisclosed coverage limitations. None of the coverages required herein will be in compliance with these requirements ifthey include any limiting endorsement of any kind that has not been first submitted to AGENCY and approved of in writing.

Separation of insureds. A severability of interests provision must apply for all additional insureds ensuring that Flock's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the insurer' s limits of liability. The policy( ies) shall not contain any cross- liability 1613128. 1

DocuSign Envelope ID: 115516E5- 4DOD- 4E39- B325- 51EA5D97948D ftock safety
exclusions.

Pass through clause. Flock agrees to ensure that its sub- consultants, sub- contractors, and any other party involved with the project who is brought onto or involved in the project by Flock, provide the same minimum insurance coverage and endorsements required of Flock. Flock agrees to monitor and review all such coverage and assumes all responsibility for ensuring that such coverage is provided in conformity with the requirements of this section. Flock agrees that upon request, all AGREEMENTS with consultants, subcontractors, and others engaged in the project will be submitted to AGENCY for review.

Agency' s right to revise specifications. The AGENCY reserves the right at any time during the term ofthe contract to change the amounts and types of insurance required by giving the Flock ninety( 90) days advance written notice of such change. If such change results in substantial additional cost to the Flock, the AGENCY and Flock may renegotiate Flock' s compensation.

Self-insured retentions. Any self-insured retentions must be declared to and approved by AGENCY.

AGENCY reserves the right to require that self-insured retentions be eliminated, lowered, or replaced by a deductible. Self-insurance will not be considered to comply with these specifications unless approved by AGENCY.

Timely notice of claims. Flock shall give AGENCY prompt and timely notice of claims made or suits instituted that arise out of or result from Flock' s performance under this AGREEMENT, and that involve or may involve coverage under any of the required liability policies.

Additional insurance. Flock shall also procure and maintain, at its own cost and expense, any additional kinds of insurance, which in its own judgment may be necessary for its proper protection and prosecution of the Installation Services and Flock Services.

Before Flock retains or hires a subcontractor to provide any work, labor, or services relative to this AGREEMENT, Flock must:

A. Present the name and identifying information of the subcontractor that will provide any work, labor, or services to AGENCY;
B. Present to the AGENCY the form of subcontract that will be used with the subcontractor for AGENCY's approval, which approval will not be unreasonably withheld. Such subcontract AGREEMENT must include an indemnity agreement that is generally in accord with the indemnity obligations contained in Paragraph 8. 4 of this AGREEMENT and must specifically name the AGENCY as an indemnified party; and
C. Secure from the subcontractor evidence of insurance coverage that meets with this AGREEMENT including naming the AGENCY as an additional insured as required by this AGREEMENT, unless such requirement is waived in writing by the AGENCY Risk Manager

7. 6 Force Majeure. Flock Safety is not responsible nor liable for any delays or failures in performance from any cause beyond its control, including, but not limited to acts of God, changes to law or regulations, embargoes, war, terrorist acts, acts or omissions of third- party technology providers, riots, fires, earthquakes, floods, power blackouts, strikes, weather conditions or acts of hackers, internet service providers or any other third party or acts or omissions of Agency or any Authorized End User.

8. LIMITATION OF LIABILITY AND INDEMNITY

8. 1 Limitation of Liability. NOTWITHSTANDING ANYTHING TO THE CONTRARY, FLOCK AND ITS

SUPPLIERS( INCLUDING BUT NOT LIMITED TO ALL HARDWARE AND TECHNOLOGY SUPPLIERS),

OFFICERS, AFFILIATES, REPRESENTATIVES, CONTRACTORS AND EMPLOYEES SHALL NOT BE

RESPONSIBLE OR LIABLE WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT OR

TERMS AND CONDITIONS RELATED THERETO UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCT LIABILITY, OR OTHER THEORY:( A) FOR ERROR OR INTERRUPTION OF USE

OR FOR LOSS OR INACCURACY, INCOMPLETENESS OR CORRUPTION OF DATA OR FOOTAGE OR

COST OF PROCUREMENT OF SUBSTITUTE GOODS, SERVICES OR TECHNOLOGY OR LOSS OF BUSINESS;( B) FOR ANY INDIRECT, EXEMPLARY, INCIDENTAL, SPECIAL OR CONSEQUENTIAL 1613128. 1

DocuSign Envelope ID: 115516E5- 4DOD- 4E39- B325- 51 EA5D97948D flock safety
DAMAGES;( C) FOR ANY MATTER BEYOND FLOCK' S ACTUAL KNOWLEDGE OR REASONABLE

CONTROL INCLUDING REPEAT CRIMINAL ACTIVITY OR INABILITY TO CAPTURE FOOTAGE OR IDENTIFY AND/ OR CORRELATE A LICENSE PLATE WITH THE FBI DATABASE;( D) FOR ANY PUBLIC DISCLOSURE OF PROPRIETARY INFORMATION MADE IN GOOD FAITH;( E) FOR CRIME PREVENTION;

OR( F) FOR ANY AMOUNTS THAT, TOGETHER WITH AMOUNTS ASSOCIATED WITH ALL OTHER

CLAIMS, EXCEED THE FEES PAID AND/ OR PAYABLE BY AGENCY TO FLOCK FOR THE SERVICES UNDER THIS AGREEMENT IN THE TWELVE( 12) MONTHS PRIOR TO THE ACT OR OMISSION THAT

GAVE RISE TO THE LIABILITY, IN EACH CASE, WHETHER OR NOT FLOCK HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN THE EVENT OF AN EMERGENCY, AGENCY SHOULD CONTACT 911 AND SHOULD NOT RELY ON THE SERVICES.THIS LIMITATION OF LIABILITY SHALL

NOT APPLY TO TORT CLAIMS FOR BODILY INJURY OR PROPERTY DAMAGE ARISING FROM OR PERTAINING TO THE PROVISION OF SERVICES UNDER THIS AGREEMENT. OF SECTION 8 ONLY

APPLIES TO THE EXTENT ALLOWED BY THE GOVERNING LAW OF THE STATE MENTIONED IN SECTION 10. 6, OR IF NO STATE IS MENTIONED IN SECTION 10. 6, BY THE LAW OF THE STATE OF CALIFORNIA.

8. 2 Additional No- Fee Term Requirements. WITH THE EXCPTION OF TORT CLAIMS FOR BODILY INJURY

OR PROPERTY DAMAGE ARISING FROM OR PERTAINING TO THE PROVISION OF SERVICES UNDER

THIS AGREEMENT, IN NO EVENT SHALL FLOCK' S AGGREGATE LIABILITY, IF ANY, ARISING OUT OF OR IN ANY WAY RELATED TO THE COMPLIMENTARY NO-FEE TERM AS DESCRIBED IN SECTION 6.5 EXCEED$ 100, WITHOUT REGARD TO WHETHER SUCH CLAIM IS BASEDIN CONTRACT, TORT INCLUDING NEGLIGENCE), PRODUCT LIABILITY OR OTHERWISE Except for Flock' s willful acts.

8. 3 Responsibility. Each Party to this Agreement shall assume the responsibility and liability for the acts and omissions of its own employees, deputies, officers, or agents, in connection with the performance of their official duties under this Agreement. Each Party to this Agreement shall be liable( if at all) only for the torts of its own officers, agents, or employees that occur within the scope of their official duties. Agency will not pursue any claims or actions against Flock' s suppliers.

8. 4 Indemnity. Agency hereby agrees to indemnify and hold harmless Flock against any damages, losses, liabilities, settlements and expenses( including without limitation costs and attorneys' fees) in connection with any claim or action that arises from an alleged violation of Section 3. 2, Agency' s breach ofthis Agreement, Agency' s Installation Obligations, Agency' s sharing of any data in connection with the Flock system, or otherwise from Agency' s use ofthe Services, Hardware and any Software, including any claim that such actions violate any applicable law or third party right. Although Flock has no obligation to monitor Agency' s use of the Services, Flock may do so and may prohibit any use of the Services it believes may be( or alleged to be) in violation of Section 3. 2 or this Agreement. Flock hereby agrees to indemnify and hold harmless Agency against any damages, losses, liabilities, settlements, and expenses( including without limitation costs and attorneys' fees) in connection with any claim or action that arises from Flock' s negligent acts or omissions in performance ofthis Agreement or provision of the Services, Hardwar, or Software, including any claim that such actions violate any applicable law or third party right.

9. RECORD RETENTION

9. 1 Data Preservation. The Agency agrees to store Agency Data and Non-Agency End User Data in compliance with its record retention schedules. Should Flock be legally compelled to produce the Agency Data and Non-Agency End User Data and Agency has retained such data, Flock may retrieve the data fromAgency upon demand.

10. MISCELLANEOUS

10. 1 Severability. If any provision ofthis Agreement is found to be unenforceable or invalid, that provision will be limited or eliminated to the minimum extent necessary so that this Agreement will otherwise remain in full force and effect and enforceable.

10.2 Assignment. This Agreement is not assignable, transferable or sublicensable by Agency except with Flock' s prior written consent. Flock may transfer and assign any ofits rights and obligations, in whole or in part, under this Agreement without consent.

10. 3 Entire Agreement. This Agreement, together with the Order Form( s), the then- current Reinstall Policy( https:// www.flocksafety.com/reinstall-fee- schedule), and Deployment Plan(s), are the complete and exclusive statement of the mutual understanding ofthe parties and supersedes and cancels all previous written and oral agreements, communications and other understandings relating to the subject matter of this Agreement, and that all waivers and modifications must be in a writing signed by both parties, except as otherwise provided herein. None of Agency' s purchase orders, authorizations or similar documents will alter the terms ofthis Agreement, and any such conflicting 1613128. 1

DocuSign Envelope ID: 115516E5- 4D0D-4E39- B325- 51 EA5D97948D ftock safety
terms are expressly rejected.

10.4 Relationship. No agency, partnership, joint venture, or employment is created as a result of this Agreement and Agency does not have any authority of any kind to bind Flock in any respect whatsoever.

10. 5 Costs and Attorneys' Fees. In any action or proceeding to enforce rights under this Agreement, the prevailing party will be entitled to recover costs and attorneys' fees.

10. 6 Governing Law; Venue. This Agreement shall be governed by the laws of the State of California without regard to its conflict of laws provisions. To the extent that the arbitration language below does not apply, the federal and state courts sitting in the State of California will have proper and exclusive jurisdiction and venue with respect to any disputes arising from or related to the subject matter ofthis Agreement. The parties agree that the United Nations Convention for the International Sale of Goods is excluded in its entirety from this Agreement. Any dispute arising out of,in connection with, or in relation to this agreement or the making of validity thereof or its interpretation or any breach thereof shall be determined and settled by arbitration in Orange County, California by a sole arbitrator pursuant to the rules and regulations then obtaining of the American Arbitration Association and any award rendered therein shall be final and conclusive upon the parties, and a judgment thereon may be entered in the highest court of the forum, state or federal, having jurisdiction. The service of any notice, process, motion or other document in connection with an arbitration award under this agreement or for the enforcement of an arbitration award hereunder may be effectuated by either personal service or by certified or registered mail to the respective addresses provided herein.

10. 7 Publicity. Unless otherwise indicated on the Order Form, Flock has the right to reference and use Agency' s name and trademarks and disclose the nature ofthe Services provided hereunder in each case in business and development and marketing efforts, including without limitation on Flock' s website.

10. 8 Export. Agency may not remove or export from the United States or allow the export or re- export of the Flock IP or anything related thereto, or any direct product thereof in violation of any restrictions, laws or regulations of the United States Department of Commerce, the United States Department of Treasury Office ofForeign Assets Control, or any other United States or foreign agency or authority. As defined in FAR section 2. 101, the Services, the Hardware, the Embedded Software and Documentation are" commercial items" and according to DFAR section 252. 2277014( a)( 1) and( 5) are deemed to be" commercial computer software" and" commercial computer software documentation." Consistent with DFAR section 227. 7202 and FAR section 12. 212, any use, modification, reproduction, release, performance, display, or disclosure of such commercial software or commercial software documentation by the U.S. Government will be governed solely by the terms of this Agreement and will be prohibited except to the extent expressly permitted by the terms ofthis Agreement.

10. 9 Headings. The headings are merely for organization and should not be construed as adding meaning to the Agreement or interpreting the associated Sections.

10. 10 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

10. 11 Authority. Each of the below signers of this Agreement represent that they understand this Agreement and have the authority to sign on behalf of and bind the organizations and individuals they are representing.

10. 12 Notices. All notices under this Agreement will be in writing and will be deemed to have been duly given when received, if personally delivered; when receipt is electronically confirmed, iftransmitted by facsimile or e- mail; the day after it is sent, if sent for next day delivery by recognized overnight delivery service; and upon receipt, if sent by certified or registered mail, return receipt requested. 1613128. 1 Page 178 of 672
1741327. 1
FLOCK GROUP INC.

ADDITIONAL SERVICES AGREEMENT
This Additional Services Agreement combined with the existing Government Agency Customer Agreement (“ Agency Agreement”) attached hereto as Exhibit “ A” and incorporated herein by this reference describe the relationship between Flock Group Inc. (“ Flock”) and the government agency identified below (“ Agency”) ( each, a “ Party” and together, the “ Parties”).

Except as expressly modified below, this Additional Services Agreement hereby incorporates and includes the terms of the existing Agency Agreement ( the “ Terms”) which describe and set forth the general legal terms governing the relationship between Flock and Agency. The Terms contain, among other things, warranty disclaimers, liability limitations and use limitations. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to them in the Agency Agreement.

This Additional Services Agreement will be effective when executed by both Parties ( the “ Effective Date”).

Agency: City of Los Alamitos Contact Name: Wayne Byerley Address:
3191 Katella Ave
Los Alamitos, CA 90720
Phone: 714- 336- 5533
E-Mail: wbyerley@cityoflosalamitos. org
Expected Payment Method:

FSExpectedPaymentMethod1\
Billing Contact: \ FSBillingContact1\
if different than above)
Initial Term: 12 months
Renewal Term: 12 months
Billing Term: Annual payment due Net 30 per terms and
conditions
Sales tax will be added to all fees as applicable. If your organization is tax exempt, please check this box:
and email your Sales Tax Exemption Certificate to billing@flocksafety. com.

I. Additional Document Retention Services and Pricing. Pursuant to this Additional Services Agreement, Flock will retain and make available to Agency’ s designated administrator and Authorized End Users ( to the extent they have access) all automatic license plate detection image records and Footage for three- hundred- sixty-five (365) days. The pricing for such additional document retention services is set below:

II. Amendments to the Agency Agreement.
a. Section 2.1 (Provision of Access) of the Agency Agreement is hereby amended to specify that the Footage will be available for Agency’ s designated administrator, listed on the Order Form, and any Authorized End Users who have access via the Web Interface for three- hundred- sixty-five (365) days. b. Section 4.2 (Agency and Non-Agency End User Data) of the Agency Agreement is hereby amended to specify that Flock may only delete Footage older than three- hundred- sixty-five (365) days. Further, Agency shall have a 365- day window to view, save and/ or transmit Footage prior to its deletion.

Name Price/ Usage Fee QTY Subtotal
Extended data retention $ 300.00 12.00 $ 3,600.00
Includes one- time fees)
Year 1 Total: $3,600.00
Recurring Total: $3,600.00
DocuSign Envelope ID: C4C38B11- 76DD- 41C9-A3C8- 6D7DF2DAA01B