Agenda packet — Los Alamitos City Council, March 24, 2025 (part 2 of 3)

City of Los Alamitos
Changes in Net Position, (Continued)
Last Ten Fiscal Years
(Accrual basis of accounting)
(Amounts expressed in thousands)
-103-
2020 2021 2022 2023 2024
Expenses
Governmental activities:

General government 3,586 $ 3,493 $ 2,548 $ 3,617 $ 4,744 $ Public safety 6,912 7,135 6,382 8,824 10,882
Community development 1,091 957 1,344 2,121 2,608
Recreation and community services 1,758 1,471 2,043 2,808 3,267 Public works 2,572 2,907 3,226 3,333 2,360
Interest and fiscal charges 58 331 138 227 191
Total governmental activities expenses 15,977 16,294 15,681 20,930 24,052 Program Revenues
Governmental activities:

Charges for services
General government 1,335 914 1,036 1,557 1,829
Public safety 711 478 841 390 604
Community development 3 2 7 1 -
Recreation and community services 781 527 892 545 460
Public works 508 353 549 - -
Operating grants 628 1,872 - 1,071 1,824
Capital grants and contributions 249 241 - 264 375
Total governmental activities program revenues 4,215 4,387 3,325 3,828 5,092 Net (expense)/revenue
Governmental activities (11,762) (11,907) (12,356) (17,102) (18,960) General Revenues and Other Changes
in Net Position
Governmental activities:

Taxes
Property 4,169 4,455 4,732 5,067 5,301
Utility users tax 1,988 1,834 2,123 2,308 2,830
Transient occupancy 132 223 522 635 598
Sales 3,227 4,855 9,671 10,718 9,632
Franchise 611 725 1,071 862 882
Business license 730 886 728 631 1,141
Other 564 548 640 671 803
13,526 11,421 19,487 20,892 21,187
Investment income 254 78 (665) (132) 1,243
Gain on Sale of property - - - - -
Other 110 528 83 131 131
Total governmental activities 11,785 14,132 18,905 20,891 22,561 Changes in Net Position
Governmental activities 23 $ 2,225 $ 6,549 $ 3,789 $ 3,601 $ Source: City of Los Alamitos Finance Department

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City of Los Alamitos
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified accrual basis of accounting)
(Amounts expressed in thousands)
-104-
2015 2016 2017 2018 2019
General Fund
Nonspendable 684 $ 59 $ 17 $ 18 $ 56 $
Committed - - - - 3,607
Assigned 7,484 7,347 7,481 7,662 4,589
Unassigned (644) 3 56 49 588
Total General Fund 7,524 7,409 7,554 7,729 8,840
All Other Governmental Funds
Restricted 1,063 1,333 1,334 1,334 1,180
Committed - - - - -
Assigned 390 1,001 345 129 99
Unassigned - - - - (4)
Total All Other Governmental Funds 1,453 2,334 1,679 1,463 1,275 Total All Governmental Funds 8,977 $ 9,743 $ 9,233 $ 9,192 $ 10,115 $ Source: City of Los Alamitos, Finance Department

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City of Los Alamitos
Fund Balances of Governmental Funds, (Continued)
Last Ten Fiscal Years
(Modified accrual basis of accounting)
(Amounts expressed in thousands)
-105-
2020 2021 2022 2023 2024
General Fund
Nonspendable 14 $ 7 $ 4 $ 35 $ 61 $
Committed 3,286 3 3 1,583 1,583
Assigned 4,196 4,203 4,196 3,900 3,600
Unassigned 2,785 9,403 12,570 14,555 17,467
Total General Fund 10,281 13,616 16,773 20,073 22,711
All Other Governmental Funds
Restricted 1,453 2,153 2,353 1,950 2,434
Committed - - - 134 432
Assigned 200 109 243 339 416
Unassigned (9) (10) (114) (114) (114)
Total All Other Governmental Funds 1,644 2,252 2,482 2,309 3,168 Total All Governmental Funds 11,925 $ 15,868 $ 19,255 $ 22,382 $ 25,879 $ Source: City of Los Alamitos, Finance Department

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City of Los Alamitos
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified accrual basis of accounting)
(Amounts expressed in thousands)
-106-
2015 2016 2017 2018 2019
Revenues
Taxes 10,337 $ 10,559 $ 10,724 $ 11,078 $ 11,600 $
Licenses and permits 205 225 272 814 831
Intergovernmental 1,609 245 609 323 294
Charges for services 1,403 1,459 1,202 1,169 1,121
Investment earnings 30 86 63 106 271
Fines and forfeitures 737 781 810 844 900
Other 454 460 476 398 349
Total Revenues 14,775 13,815 14,156 14,732 15,366
Expenditures
General government 2,379 2,735 2,029 2,243 2,299
Public safety 5,513 5,711 5,777 5,751 5,886
Community development 694 657 715 1,044 928
Recreation and community services 1,730 1,739 1,646 1,598 1,590 Public works 1,771 1,963 1,963 1,943 2,064
Capital outlay 830 213 1,972 1,068 332
Debt service:

Principal retirement 75 75 70 70 70
Payment to refunded bond escrow agent - 220 - - -
Interest and fiscal charges 138 311 142 140 139
Total Expenditures 13,130 13,624 14,314 13,857 13,308
Excess of revenues over/(under) expenditures 1,645 191 (158) 875 2,058 Other Financing Sources (Uses)
Lease acquisition - - - -
Transfers in 684 681 1,280 832 597
Transfers out (1,892) (1,203) (2,201) (1,752) (1,157)
Refunding bonds issued - 3,685 - - -
Bond premium - 133 - - -
Payment to refunded bond escrow agent - (2,722) - - -
Total other financing sources (1,208) 574 (921) (920) (560) Net change in fund balances 437 $ 765 $ (1,079) $ (45) $ 1,498 $ Debt service as a percentage of noncapital expenditures 1.813% 2.865%(1) 1.713% 1.640% 1.611% (1) Increase in debt service related to issuance of Certificates of Participation Source: City of Los Alamitos Administrative Services Department

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City of Los Alamitos
Changes in Fund Balances of Governmental Funds, (Continued) Last Ten Fiscal Years
(Modified accrual basis of accounting)
(Amounts expressed in thousands)
-107-
2020 2021 2022 2023 2024
Revenues
Taxes 11,422 $ 13,526 $ 19,487 $ 21,116 $ 21,519 $
Licenses and permits 1,462 914 1,035 815 816
Intergovernmental 684 1,888 699 691 1,429
Charges for services 1,310 890 905 881 765
Investment earnings 254 78 (665) (132) 1,243
Fines and forfeitures 694 468 401 575 776
Other 301 610 324 774 1,105
Total Revenues 16,127 18,374 22,186 24,720 27,653
Expenditures
General government 2,405 2,240 2,993 3,055 4,156
Public safety 5,585 5,938 6,617 7,699 8,455
Community development 1,052 1,185 1,292 1,903 2,257
Recreation and community services 1,615 1,391 1,911 2,485 2,706 Public works 1,983 2,379 2,952 3,034 3,800
Capital outlay 865 490 957 2,597 1,772
Debt service:

Principal retirement 75 75 80 94 214
Payment to refunded bond escrow agent - - - - -
Interest and fiscal charges 136 134 130 165 138
Total Expenditures 13,716 13,832 16,932 21,032 23,498
Excess of revenues over/(under) expenditures 2,411 4,542 5,254 3,688 4,155 Other Financing Sources (Uses)
Lease acquisition - - - 199 -
Transfers in 808 733 828 736 732
Transfers out (1,409) (1,334) (1,678) (1,496) (1,392)
Refunding bonds issued - - - - -
Bond premium - - - - -
Payment to refunded bond escrow agent - - - - -
Total other financing sources (601) (601) (850) (561) (660) Net change in fund balances 1,810 $ 3,941 $ 4,404 $ 3,127 $ 3,495 $ Debt service as a percentage of noncapital expenditures 1.642% 1.566% 1.315% 1.429% 1.774% (1) Increase in debt service related to issuance of Certificates of Participation

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City of Los Alamitos
2023/24 Use Category Summary - Basic Property Value Table Last Ten Fiscal Years
(Amounts expressed in thousands)
-108-
2015 2016 2017 2018 2019
Category
Residential 1,031,002 $ 1,091,854 $ 1,143,395 $ 1,200,335 $ 1,266,083 $ Commercial 318,001 359,002 365,544 393,211 405,241
Industrial 271,390 278,399 292,535 292,689 308,001
Miscellaneous - - - - 1,793
Vacant land 8,449 9,710 9,905 11,648 10,088
SBE Nonunitary 222 222 222 222 970
Cross Reference 3,265 3,083 3,998 4,139 4,109
Unsecured 143,801 138,386 154,478 163,741 161,257
Totals 1,776,130 $ 1,880,656 $ 1,970,077 $ 2,065,985 $ 2,157,542 $ Direct rate 0.11568% 0.11571% 0.11578% 0.11578% 0.11821% Note:

Source: HdL Coren and Cone, Orange County Assessor Tax Rate Table In 1978, the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year the assessed value of property may be increased by an inflation factor (limited to a maximum increase of 2%). With few exceptions, property is only reassessed at the time that it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property.

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City of Los Alamitos
2023/24 Use Category Summary - Basic Property Value Table, (Continued) Last Ten Fiscal Years
(Amounts expressed in thousands)
-109-
2020 2021 2022 2023 2024
Category
Residential 1,332,806 $ 1,408,761 $ 1,479,534 $ 1,601,740 $ 1,698,428 $ Commercial 427,330 459,279 506,538 532,835 584,480
Industrial 315,346 382,149 417,895 438,566 520,831
Miscellaneous 608 555 - 572 2,205
Vacant land 19,185 14,902 10,998 948 834
SBE Nonunitary 970 970 401 361 361
Cross Reference 4,177 3,976 4,002 4,215 4,368
Unsecured 164,509 158,443 189,648 183,150 175,911
Totals 2,264,931 $ 2,429,035 $ 2,609,016 $ 2,762,387 $ 2,987,418 $ Direct rate 0.11848% 1.17510% 0.11703% 0.11703% 0.11656% Note:

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City of Los Alamitos
Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years
(Amounts expressed in thousands)
-110-
Total
Fiscal Year Taxable Direct
Ended Less: Assessed Tax
June 30 Secured Unsecured Exemptions (1) Value (2) Rate 2015 1,632,107 $ 143,801 $ - $ 1,775,908 $ 0.117
2016 1,742,048 138,386 - 1,880,434 0.116
2017 1,806,377 154,478 - 1,960,855 0.116
2018 1,902,022 163,742 - 2,065,764 0.116
2019 1,995,314 161,257 - 2,156,571 0.116
2020 2,099,452 164,509 - 2,263,961 0.116
2021 2,269,621 158,443 - 2,428,064 0.116
2022 2,418,967 189,648 - 2,608,615 0.117
2023 2,578,876 183,150 - 2,762,026 0.117
2024 2,811,508 175,910 - 2,987,418 0.117
(1) Exemptions are netted against the individual property categories. (2) Total includes Nonunitary Taxable Assessed Values.

Note:

Source: HdL Coren and Cone, Orange County Assessor Combined Tax Rolls In 1978, the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year the assessed value of property may be increased by an inflation factor (limited to a maximum increase of 2%). With few exceptions, property is only reassessed at the time that it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.

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City of Los Alamitos
Direct and Overlapping Property Tax Rates
(Rate per $100 of assessed value)
Last Ten Fiscal Years
-111-
2015 2016 2017 2018 2019
City Direct Rate 0.117 0.116 0.116 0.116 0.116
Overlapping Rates:

Los Alamitos City General Fund 0.101 0.101 0.101 0.101 0.101 Los Alamitos City Lighting Reorganization 0.016 0.016 0.016 0.016 0.016 Educational Revenue Augmentation Fund 0.144 0.145 0.145 0.145 0.145 Los Alamitos Unified General Fund 0.411 0.412 0.412 0.412 0.412 North Orange Co. Community College District 0.059 0.059 0.059 0.059 0.059 Orange County Department of Education 0.031 0.031 0.031 0.031 0.031 Orange County Fire Authority 0.095 0.095 0.095 0.095 0.095 Orange County Flood Control District General 0.017 0.017 0.017 0.017 0.017 Orange County General Fund 0.052 0.052 0.052 0.052 0.052 Orange County Harbors Beaches & Parks CSA 26 0.013 0.013 0.013 0.013 0.013 Orange County Public Library 0.014 0.014 0.014 0.014 0.014 Orange County Sanitation District 3 Operating 0.027 0.027 0.027 0.027 0.027 Orange County Transit Authority 0.002 0.002 0.002 0.002 0.002 Orange County Vector Control 0.001 0.001 0.001 0.001 0.001 Orange County Water District reserve 0.006 0.006 0.006 0.006 0.006 Orange County Water District reserve 0.001 0.000 0.000 0.000 0.000 Rossmoor/Los Alamitos Sewer District 0.010 0.010 0.010 0.010 0.010 Total Prop 13 Rate 1.000 1.000 1.000 1.000 1.000
Anaheim High School District 0.024 0.049 0.043 0.022 0.042 Cypress Elementary 0.023 0.025 0.024 0.031 0.030
Garden Grove Unified School District 0.041 0.047 0.045 0.075 0.068 Los Alamitos Sfid 0.048 0.052 0.048 0.047 0.049
Metropolitan Water District 0.004 0.004 0.004 0.004 0.004 N. Orange County Community College 0.017 0.030 0.029 0.029 0.028 Total Voter Approved tax Rate 0.157 0.207 0.192 0.207 0.221 Total Tax Rate 1.157 1.207 1.192 1.207 1.220
Source: HdL Coren and Cone, Orange County Assessor 2011/2012 - 2020/2021 Tax Rate Table

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City of Los Alamitos
Direct and Overlapping Property Tax Rates, (Continued)
(Rate per $100 of assessed value)
Last Ten Fiscal Years
-112-
2020 2021 2022 2023 2024
City Direct Rate 0.116 0.116 0.117 0.117 0.117
Overlapping Rates:

Los Alamitos City General Fund 0.101 0.101 0.101 0.101 0.101 Los Alamitos City Lighting Reorganization 0.016 0.016 0.016 0.016 0.016 Educational Revenue Augmentation Fund 0.145 0.145 0.145 0.145 0.145 Los Alamitos Unified General Fund 0.412 0.412 0.412 0.412 0.412 North Orange Co. Community College District 0.059 0.059 0.059 0.059 0.059 Orange County Department of Education 0.031 0.031 0.031 0.031 0.031 Orange County Fire Authority 0.095 0.095 0.095 0.095 0.095 Orange County Flood Control District General 0.017 0.017 0.017 0.017 0.017 Orange County General Fund 0.052 0.052 0.052 0.052 0.052 Orange County Harbors Beaches & Parks CSA 26 0.013 0.013 0.013 0.013 0.013 Orange County Public Library 0.014 0.014 0.014 0.014 0.014 Orange County Sanitation District 3 Operating 0.027 0.027 0.027 0.027 0.027 Orange County Transit Authority 0.002 0.002 0.002 0.002 0.002 Orange County Vector Control 0.001 0.001 0.001 0.001 0.001 Orange County Water District reserve 0.006 0.006 0.006 0.006 0.006 Orange County Water District reserve 0.000 0.000 0.000 0.000 0.000 Rossmoor/Los Alamitos Sewer District 0.010 0.010 0.010 0.010 0.010 Total Prop 13 Rate 1.000 1.000 1.000 1.000 1.000
Anaheim High School District 0.040 0.040 0.038 0.030 0.032 Cypress Elementary 0.030 0.033 0.030 0.032 0.031
Garden Grove Unified School District 0.069 0.070 0.074 0.063 0.067 Los Alamitos Sfid 0.080 0.093 0.079 0.082 0.072
Metropolitan Water District 0.004 0.004 0.004 0.004 0.004 N. Orange County Community College 0.024 0.032 0.029 0.028 0.017 Total Voter Approved tax Rate 0.247 0.271 0.253 0.238 0.222 Total Tax Rate 1.247 1.271 1.253 1.238 1.222
Source: HdL Coren and Cone, Orange County Assessor 2013/2014 - 2022/2023 Tax Rate Table

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City of Los Alamitos
Principal Property Taxpayers
Current Year and Ten Years Ago
(Amounts expressed in thousands)
-113-
2024 2015
Percent of Percent of
Total City Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Value Value Value Value
Los Alamitos APG LLC 130,455 $ 4.397%
Regents The 111,606 3.762%
Duke Realty Los Alamitos LP 67,120 2.262%
Fine US Long Beach LLC 61,384 2.069%
JCB Merger Sub LLC 44,995 1.517%
Trend Offset Printing Inc. 0.000% 50,512 $ 2.844%
Bar Bakers LLC 30,630 1.032%
Lampson Park Place LLC 27,030 0.911%
Los Alamitos Luxury Apartments LLC 26,626 0.897%
Los Alamitos Medical Center 26,561 0.895% 79,470 4.474% Los Alamitos Corporation Center JV - 0.000% 54,177 3.050% Epson America USA 23,690 0.799%
CGM Katella LLC 0.000% 17,875 1.006%
JCB Inc Tinicum Corporation 0.000% 15,369 0.865%
Bayport Los Alamitos Associates LP 30,937 1.742%
Fine US Long Beach LLC 17,381 0.979%
Davenport KCC Partners LLC 12,659 0.713%
Arrowhead Products Corporation 12,386 0.697%
Los Alamitos LLC 11,100 0.625%
Top Ten Totals 550,097 $ 18.542% 301,866 $ 16.996%
City Totals 2,762,386 $ 1,669,324 $
Source: HdL Coren and Cone, Orange County Assessor 2013/14 and 2022/23 Tax Rolls

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City of Los Alamitos
Property Tax Levies and Collections
Last Ten Fiscal Years
(Amounts expressed in thousands)
-114-
Fiscal Collected Within the
Year Taxes Levied Fiscal Year of Levy Collections Total Collections to Date Ended for the Percent for Prior Percent
June 30 Fiscal Year Amount of Levy Years (1) Amount of Levy 2015 2,130,906 $ 2,081,181 $ 97.666% 19,659 $ 2,100,840 $ 98.589% 2016 2,261,032 2,220,841 98.222% 18,519 2,239,360 99.041% 2017 2,347,295 2,314,148 98.588% 17,812 2,331,960 99.347% 2018 2,457,342 2,440,391 99.310% 16,019 2,456,410 99.962% 2019 2,679,049 2,629,318 98.144% 16,951 2,646,269 98.776% 2020 2,786,377 2,742,208 98.415% 21,973 2,764,181 99.203% 2021 2,903,005 2,761,268 95.118% 18,858 2,780,126 95.767% 2022 2,950,445 2,737,154 92.771% 18,843 2,755,997 93.410% 2023 3,007,393 2,762,386 91.853% 22,187 2,784,573 92.591% 2024 3,155,501 2,987,413 94.673% 22,741 3,068,332 97.238% Source: Orange County Auditor - Controller
(1) Total amount of delinquent taxes collected in each fiscal year; information regarding levy year to which delinquent tax collections pertain is not provided by the Orange County Auditor-Controller.

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City of Los Alamitos
Ratio of Outstanding Debt by Type
Last Ten Fiscal Years
(Amounts expressed in thousands, except per capita)
-115-
Governmental Activities Debt as a
Certificates Total Percentage Debt
Fiscal of Leases Primary of Personal Per
Year Participation Payable Government Income1 Capita1
2015 2,895 $ - $ 2,895 $ 0.662% 246.91 $
2016 3,685 - 3,685 0.874% 313.94
2017 3,615 270 3,615 0.849% 307.95
2018 3,545 204 3,749 0.871% 316.02
2019 3,475 137 3,612 0.869% 308.16
2020 3,400 69 3,469 0.782% 299.90
2021 3,325 68 3,393 0.704% 294.07
2022 3,245 62 3,307 0.688% 278.53
2023 3,261 688 3,949 0.772% 325.58
2024 3,171 739 3,910 0.687% 327.28
1 Ratio is calculated using personal income and population data for the prior calendar year.

Source: City of Los Alamitos, Finance Department

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City of Los Alamitos
Direct and Overlapping Governmental Activity Debt
As of June 30, 2024
(Amounts expressed in thousands)
-116-
2023-2024 Taxable Assessed Valuation: $2,953,284,115
City's
Total Percent Share
Debt Applicable of Debt
6/30/2024 to City (1) 6/30/2024

DIRECT DEBT
Vehicle leases payable 382 $ 100.000% 382 $
Warehouse leases payable 230 100.000% 230
Camera lease debt 127 100.000% 127
Bonded debt 3,075 100.000% 3,171
TOTAL DIRECT DEBT 3,910
OVERLAPPING TAX ASSESSMENT DEBT:

Metropolitan Water District 18,210 0.076% 14
N.OC Community College 2014 Bond Series B 291,561 1.725% 5,029 Garden Grove USD 2016 Series 2019 571,805 0.010% 51,781 Los Alamitos SFID #1 2008 Series A 215,670 23.648% 51,002 Anaheim High 2014 Bond Series 2019 229,079 0.098% 224
Cypress Elementary 2008 Bond, Series B1 & B2 31,789 0.665% 211 TOTAL OVERLAPPING TAX ASSESSMENT DEBT: 108,261
DIRECT AND OVERLAPPING GENERAL FUND DEBT:

Orange County General Fund Obligations 440,385 0.384% 1,691 Orange County Board of Education Cert of Participations 10,030 0.384% 39 Los Alamitos SFID #1 2008 Series 2020G 30,433 21.265% 6,472 Anaheim High 2018 Bond Series 2014 28,320 0.098% 28
Cypress Elementary 2008 Bond Series A 2,726 0.665% 18
N.OC Community College 2014 Bond Series A 7,350 1.771% 130 City of Los Alamitos Certificate of Participation 3,075 100.000% 3,075 Lease Payables 739 100.000% 739
TOTAL DIRECT AND OVERLAPPING GENERAL FUND DEBT: 12,192
TOTAL DIRECT DEBT 3,910
TOTAL OVERLAPPING DEBT 116,639
TOTAL DIRECT & OVERLAPPING DEBT 120,549 $
Ratios to Assessed Valuation:

Total Direct Debt …………………………………………….. 0.10%
Overlapping Debt ……………………………………………. 1.91%
Net Combined Total Debt ……………………………………2.01%
(1) The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value.

Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's total taxable assessed value. of the city divided by the district's total taxable assessed value.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations. Qualified Zone Academy Bonds are included based on principal due at maturity.

Source - HdL Coren & Cone, Orange County Assessor and Auditor Combined 2023/24 Lien Date Tax Rolls.

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City of Los Alamitos
Legal Debt Margin Information
Last Ten Fiscal Years
-117-
Legal Debt Margin Calculation for the Current Year
Assessed value 2,953,284,115 $
Debt limit (15% of assessed value) 442,992,617
Legal debt margin - Current Year 442,992,617 $
Debt Legal Debt as
Fiscal Debt Applicable Debt Percentage
Year Limit to Limit Margin of Limit
2015 266,419,511 $ - $ 266,419,511 $ -
2016 282,098,369 - 282,098,369 -
2017 294,616,529 - 294,616,529 -
2018 309,897,790 - 309,897,790 -
2019 323,585,613 3,612,467 319,973,146 1.12%
2020 343,305,168 3,565,517 339,739,651 1.04%
2021 367,857,100 3,325,000 364,532,100 0.90%
2022 394,702,562 3,350,121 391,352,441 0.85%
2023 414,562,396 3,260,769 411,301,627 0.79%
2024 442,992,617 3,075,000 439,917,617 0.69%
Source: City of Los Alamitos, Finance Department

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City of Los Alamitos
Demographic and Economic Statistics
Last Ten Calendar Years
-118-
Personal Per Capita
Calendar Income Personal Unemployment
Year Population (in thousands) Income Rate
2014 11,725 $ 437,214 $ 37,289 $ 5.50%
2015 11,738 421,786 35,933 4.50%
2016 11,739 425,943 36,284 4.00%
2017 11,863 430,396 36,280 4.00%
2018 11,721 415,852 35,479 3.20%
2019 11,567 443,756 38,363 2.90%
2020 11,538 481,688 41,747 8.90%
2021 11,873 480,337 40,456 8.30%
2022 12,129 511,316 42,156 4.50%
2023 11,947 569,293 47,651 5.00%
Per Capita Personal Income and Unemployment
Sources:

Population: California State Department of Finance
Unemployment Rate: California Employment Development Department Personal Income and Per Capita Income: ESRI

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

9.00%

10.00%
$30,000
$32,000
$34,000
$36,000
$38,000
$40,000
$42,000
$44,000
$46,000
$48,000
$50,000
2015 2016 2017 2018 2019 2020 2021 2022 2023
Per Capita Personal Income Unemployment

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City of Los Alamitos
Full-Time Equivalent City Government Employees by Function/Program Last Ten Fiscal Years
-119-
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Function/Program
General Government
City Council 5 5 5 5 5 5 5 5 5 5
Administration 8 8 8 8 8 6 6 7 8 10
Community Development
Administration 1 1 1 1 1 1 1 1 3 6
Planning 1 1 1 1 1 1 1 1 1 1
Code enforcement 1 1 1 1 1 1 1 1 1 1
Police
Administration 4 4 4 4 4 4 4 5 5 5
Patrol 19 19 19 18 18 13 13 15 15 15
Investigation 3 3 3 3 3 3 2 3 4 3
Records 2 2 2 2 2 2 3 3 3 3
Crossing guards 3 3 3 1 1 1 1 1 1 1
Other PD support 2 2 2 2 2 2 3 3 0 3
Public Works
Admin./engineering 1 1 1 1 1 1 1 4 3 1
Maintenance 10 10 10 9 9 7 7 6 6 10
Recreation and Community Services
Administration 5 5 5 4 4 4 2 7 3 6
Recreation/cultural 15 15 15 11 11 11 9 11 5 6
Source: City of Los Alamitos, Finance Department

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City of Los Alamitos
Operating Indicators by Function/Program
Last Ten Fiscal Years
-120-
2015 2016 2017 2018 2019
Function/Program
Community Development
Number of:

Business licenses 2,227 2,169 2,068 2,153 1,806
Plan checks 95 96 93 108 98
NPDES inspections 104 60 60 157 85
Code violations 121 267 267 483 420
Police
Number of:

Part 1 crimes 299 252 268 209 193
Parking violations 3,283 3,963 2,997 4,043 4,221
Traffic (moving) violations 1,786 1,473 2,885 1,430 1,114 Incident and crime reports 1,381 1,167 1,254 896 752
Public Works
Square yd. of street resurfacing/repair 15,000 - - - -
Miles of street sweeping 33 33 33 33 33
Number of:

Street signal maintained 25 25 25 25 25
Trees pruned per year 615 991 991 991 991
Square feet graffiti removal 1,245 1,205 1,205 1,205 1,205 Recreation and Community Services
Total in attendance:

Aquatics 235,000 163,000 - - -
Community Services/Seniors 10,500 13,180 14,000 14,100 18,390 Day Camp 2,900 2,800 3,000 4,040 3,500
Park Program 4,385 4,262 4,140 4,040 3,000
Sports N/A 35,500 30,000 30,500 28,234
Classes 6,900 8,900 8,900 8,800 10,300
Special Events 34,200 30,475 34,820 35,000 38,225
NA - Not Available
Source: City of Los Alamitos, Finance Department

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City of Los Alamitos
Operating Indicators by Function/Program, (Continued)
Last Ten Fiscal Years
-121-
2020 2021 2022 2023 2024
Function/Program
Community Development
Number of:

Business licenses 2,046 2,630 2,413 2,220 2,317
Plan checks 74 81 338 408 398
NPDES inspections 79 9 55 75 85
Code violations 451 946 1,892 1,194 1,006
Police
Number of:

Part 1 crimes 189 330 157 343 197
Parking violations 1,471 1,470 3,835 1,915 2,794
Traffic (moving) violations 342 636 677 1,313 784
Incident and crime reports 729 1,046 1,044 1,116 863
Public Works
Square yd. of street resurfacing/repair - - 62,445 75,750 15,000 Miles of street sweeping 33 33 858 3,604 3,604
Number of:

Street signal maintained 21 22 28 72 21
Trees pruned per year 995 1,375 1,529 1,832 272
Square feet graffiti removal 900 1,100 1,836 2,412 108
Recreation and Community Services
Total in attendance:

Aquatics - - - 885 3,000
Community Services/Seniors 17,040 16,000 21,600 23,760 23,000 Day Camp 3,200 4,500 4,400 4,840 4,900
Park Program 2,400 2,250 1,800 2,000 2,000
Sports 14,970 13,000 15,550 17,248 17,200
Classes 9,960 8,000 11,000 12,100 12,000
Special Events 31,600 20,000 35,020 41,650 42,000
NA - Not Available
Source: City of Los Alamitos, Finance Department

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City of Los Alamitos
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years
-122-
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Function/Program
Community Development
Code enforcement vehicles 1 1 1 1 1 1 2 2 2 3
EV Vehicles (Cart) 2
Police
Stations 1 1 1 1 1 1 1 1 1 1
Patrol vehicles 7 7 8 8 8 8 10 13 9 11
Other vehicles 9 9 9 9 9 9 11 11 16 19
Public Works
Streets (miles) 32.9 32.9 32.9 32.9 32.9 32.9 32.9 32.9 32.9 32.9 Street lights 911 911 911 911 911 911 911 911 911 911
Traffic signals 25 25 25 25 25 25 25 25 25 25
Public works vehicles 13 13 13 11 11 11 11 11 10 15
Recreation and Community Services
Youth centers 1 1 1 1 1 1 1 1 1 1
Community centers 1 1 1 1 1 1 1 1 1 1
Parks 9 9 9 9 9 9 9 9 9 9
Community service vehicles 2 2 2 3 3 3 3 3 5 6
Source: City of Los Alamitos, Administrative Services Department

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City of Los Alamitos
Top 10 Businesses for Fiscal Years 2023/24
-123-
Ranking Firm Name
1 Ganahl Lumber
2 Shell
3 Grating Pacific
4 Gemini Forrest Products
5 Siteone Landscape Supply
6 Trend Offset Printing
7 Mamas Comfort Food
8 Katella Bakery & Deli
9 Adamson Police Products
10 Chevron

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City of Los Alamitos
Principal Employers
Current Year and Ten Years Ago
-124-
FY 2023-24 FY 2014-15
% of % of
Total City Total City
Employer Employees Rank Employment Employees Rank Employment Los Alamitos Medical Center 1,059 1 7.27% 1,047 1 7.41% Arrowhead Products 100 8 0.05% 661 2 0.05%
Trend Offset Printing 3 632 0.04%
Epson America 501 3 0.04%
Bar Bakers, LLC 563 2 0.02%
Mittera California, Inc. 193 5 0.01% 186 5 0.04%
Super Media Sales, Inc. - 158 6 0.04%
Alliance Space Systems 100 9 0.01% 145 8 0.01%
Katella Delicatessen-Restaurant-Bakery, Inc. 197 4 0.01% 190 4 0.01% Bearing Inspection, Inc. 102 7 0.01%
Ganahl Lumber 9 122 0.01%
Alamitos West Health & Rehabilitation 139 6 0.01% 152 7 0.01% Maderas 99 10 0.01%
Millie & Severson Inc. 105 10 0.01%
Total

7.44% 3,398 3,053 7.63%
Source: HdL Companies, City Planning Department, and State of California Employment Development Department

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735 E. Carnegie Dr. Suite I 00
San Bernardino. CA 92408
909 889 0871 T
909 889 5361 F
ramscpa. net

PARTNERS
Scott W Manno. CPA. CGMA
Leena Shanbhag, CPA. MST. CGMA
Bradferd A. Welebir. CPA. MBA. CGMA
Jenny W. Liu. CPA, MST
Ga,·denya Duran, CPA, CGMA
Brianna Schultz, CPA. CGMA
Brenda L. Odle. CPA. MST (Partne, Emeritus)
Te, ry P Shea, CPA (Panner Emenws)

MANAGERS/ STAFF
Seong-Hyea Lee. CPA. MBA
Evelyn Morenlin-Barcena. CPA
Vernnica Hernandez, CPA
Laura A1v1zu. CPA
John Maldonado, CPA, MSA
Julia Rodriguez Fuentes. CPA, MSA
Dem, Hite. CPA
Jeffrey McKennan. CPA
Mornca Wysock,, CPA
Jacob Weatherb,e. CPA, MSA
Bolim Han. CPA. MAcc
Anny Gonzalez, CPA

MEMBERS
Amencan lnsutuce of
Certified Public Accountants
PCPS The A/CPA Alliance
(01 CPA Fi,ms
Governmental Audit
Q11C1/1ty Cenre,
Califot nia Society of
Certified Public Accountants
•
Proud Member of
AlliottGlobalAlliance~

ROGERS, ANDERSON , MALODY & SCOTT, LLP
CERTIFIED PUBLIC ACCOUNTANTS. SINCE 1948
STABILITY. ACCURACY. TRUST.
-1-

REPORT ON INTERNAL CONTROL OVER FINANCIAL

REPORTING AND ON COMPLIANCE AND OTHER MATTERS

BASED ON AN AUDIT OF FINANCIAL STATEMENTS

PERFORMED IN ACCORDANCE WITH

GOVERNMENT AUDITING STANDARDS
Independent Auditor’s Report
To the Honorable Mayor and Members of the City Council
City of Los Alamitos
Los Alamitos, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Los Alamitos (the entity), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the entity’s basic financial statements, and have issued our report thereon dated March 3, 2025.

Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the entity’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we do not express an opinion on the effectiveness of the entity’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness yet important enough to merit attention by those charged with governance.

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-2-
We consider the deficiency described in the accompanying Schedule of Findings and Responses as item 2024-002 to be a significant deficiency. Item 2024-002 was previously communicated as 2023-004.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. We consider the deficiency described in the accompanying Schedule of Findings and Responses as item 2024-001 to be a material weaknesses. Item 2024-001 was previously communicated as 2023-003.

Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the entity’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Entity’s Response to Findings
Government Auditing Standards requires the auditor to perform limited procedures on the entity’s response to the findings identified in our audit and described in the accompanying Schedule of Findings and Responses. The entity’s response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on the response.

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

San Bernardino, California
March 3, 2025

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City of Los Alamitos
Schedule of Findings and Responses
For the Year Ended June 30, 2024
- 3 -
2024-001 – Reliability of Financial Information
Material Weakness
Criteria
The financial information for the year ended June 30, 2024, included errors in certain balance sheet accounts that were the result of ineffective monitoring procedures and closing processes throughout the year. These errors caused misstatements on both the balance sheet and income statement, and in certain circumstances resulted in audit adjustments. Because these errors were not detected prior to the information being provided for audit, there is an indication that the closing procedures, specifically the monitoring and review of financial information by management, are not being effectively performed. It is our understanding that these errors were present throughout the year and were not corrected in the year-end closing process.

Condition
During our audit of the City, there was various audit adjustments proposed to correct numerous accounts.

Cause
Due to staff turnover in finance, there was insufficient staffing to maintain proper closing procedures.

Effect
This will prevent incorrect balances or entries from being recorded.

Recommendation
We strongly recommend that a closing process be implemented that requires all of the balance sheet accounts be reconciled to supporting statements and subsidiary ledgers. In addition, we strongly recommend that the City implement the use of a closing checklist for yearend procedures. This oversight will help to ensure that the periodic financial statements being provided include an accurate reporting of the City’s operations.

Management’s Response
The City has consistently used a closing checklist as part of its year-end procedures. Each year, improvements are made to the list to accurately incorporate changes and any additional requirements as a result of new GASB pronouncements. For the majority of the year, interim staffing was in place to augment the vacancy of the Finance Manager. Following the successful hiring and onboarding of the position in mid-November, there was not adequate time for transition or training to bring the new individual up to speed in the midst of the audit. Therefore, some additional entries were necessary and made following the completion of the final fieldwork. The new Finance Manager has received formalized training in Governmental Fund Accounting and experience with a government audit and expectations of year-end work and is expected to successfully manage the process for the next audit for FY24-25.

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City of Los Alamitos
Schedule of Findings and Responses
For the Year Ended June 30, 2024
- 4 -
2024-002 – Bank Reconciliations
Significant Deficiency
Criteria
Bank reconciliations should be prepared, reviewed and approved in a timely manner.

Condition
During our audit of the City, we noted that bank reconciliations selected for the month ending September 2023, October 2023, December 2023, and February 2024 were prepared and approved between eighty and one hundred and eighty days after the month end.

Cause
Due to staff turnover in finance, there was insufficient staffing to maintain the timely reconciliation of the bank accounts.

Effect
Unauthorized transactions could go through the bank accounts without detection for an extended period of time if accounts are not reconciled regularly.

Recommendation
We recommend that the City ensure that all bank reconciliations are prepared, reviewed and approved in a timely manner and documentation of when the preparation and review are completed should be maintained.

Management’s Response
For the majority of the year, interim staffing was in place to augment the vacancy of the Finance Manager. As such, bank reconciliations were being performed as quickly as possible, given staffing shortages. Some periods required additional time to research to correct any errors between the bank and the general ledger. A new process was implemented in 2023 to reflect when the bank reconciliation is completed and when it is reviewed and approved. With a permanent Finance Manager in place, this has been given top priority, and all bank reconciliations will be targeted for completion within 45 to 60 days from the close of a monthly period.

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735 E. Carnegie Dr. Suite I 00
San Bernardino. CA 92408
909 889 0871 T
909 889 5361 F
ramscpa. net

ROGERS, ANDERSON , MALODY & SCOTT, LLP
CERTIFIED PUBLIC ACCOUNTANTS. SINCE 1948
STABILITY. ACCURACY. TRUST.
-1-
March 3, 2025
To the Honorable City Council
City of Los Alamitos, California
We have audited the financial statements of the City of Los Alamitos (the entity) as of and for the year ended June 30, 2024, and have issued our report thereon dated March 3, 2025. Professional standards require that we advise you of the following matters relating to our audit.

Our Responsibility in Relation to the Financial Statement Audit As communicated in our engagement letter dated June 7, 2024, our responsibility, as described by professional standards, is to form and express opinions about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities.

Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes consideration of the system of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, as part of our audit, we considered the system of internal control of the entity solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control.

We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are not required to design procedures for the purpose of identifying other matters to communicate to you.

We have provided our findings regarding significant control deficiencies over financial reporting and material weaknesses and material noncompliance, and other matters noted during our audit in a separate letter to you dated March 3, 2025.

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-2-
Planned Scope and Timing of the Audit
We conducted our audit consistent with the planned scope and timing we previously communicated to you.

Compliance with All Ethics Requirements Regarding Independence The engagement team, others in our firm, as appropriate, and our firm have complied with all relevant ethical requirements regarding independence.

We have evaluated whether certain nonattest services performed by our firm during the audit have created a significant threat to our independence in relation to the entity. We have identified a threat to our independence (preparation of the entity’s financial statements, creating a self-review threat) that if not reduced to an acceptable level, would impair our independence. In order to reduce the threat to an acceptable level, we have applied the following safeguard:

Prior to the issuance of the entity’s financial statements, another partner or manager, independent of the engagement, will review the financial statements.

Significant Risks Identified
We have identified the possibility of the following significant risks:

Management's override of internal controls over financial reporting – Management override of internal controls is the intervention by management in handling financial information and making decisions contrary to internal control policy.

Revenue recognition – Revenue recognition is a generally accepted accounting principle that refers to the conditions under which an entity can recognize a transaction as revenue. Auditing standards indicate that recognizing revenue is a presumed fraud risk and usually classified as a significant risk in most audits.

These significant risks are presumptive in most audits and merit attention by the auditors due to the direct impact over financial reporting and internal control processes. Although identified as significant risks, we noted no matters of management override of controls or deviations from generally accepted accounting principles which caused us to modify our audit procedures or any related matters which are required to be communicated to those charged with governance due to these identified risks.

Qualitative Aspects of the Entity’s Significant Accounting Practices Significant Accounting Policies
Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the entity is included in Note 1 to the financial statements. The City adopted GASB Statement No. 100, Accounting Changes and Error Corrections during 2024. No matters have come to our attention that would require us, under professional standards, to inform you about (1) the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus.

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-3-
Significant Accounting Estimates and Related Disclosures Accounting estimates and related disclosures are an integral part of the financial statements prepared by management and are based on management’s current judgments. Those judgments are normally based on knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ markedly from management’s current judgments.

The most sensitive accounting estimates affecting the entity’s financial statements are:

Management’s estimate of the net pension liability and related deferred inflows and outflows of resources are based on actuarial reports by independent actuaries. We evaluated the key factors and assumptions used to develop the estimate in determining that it is reasonable in relation to the basic financial statements taken as a whole and in relation to the applicable opinion units.

Management’s estimate of the liability for other post-employment benefits (OPEB) and related deferred inflows and outflows of resources are based on actuarial reports provided by independent actuaries. We evaluated the key factors and assumptions used to develop the estimate in determining that it is reasonable in relation to the basic financial statements taken as a whole and in relation to the applicable opinion units.

Financial Statement Disclosures
Certain financial statement disclosures involve significant judgment and are particularly sensitive because of their significance to financial statement users.

The most sensitive disclosures affecting the entity’s financial statements relate to:

The disclosure of fair value of investments in the basic financial statements represents amounts susceptible to market fluctuations.

The disclosure of capital assets (and related accumulated depreciation) in the basic financial statements is based on historical information which could differ from actual useful lives of each capitalized item.

The disclosure of net pension liability and related deferred inflows and outflows of resources in the basic financial statements is based on actuarial assumptions. Actual future liabilities and actuarial deferred inflows and outflows may vary from disclosed estimates.

The disclosures of the other post-employment benefits (OPEB) liability and related deferred inflows and outflows of resources in the basic financial statements is based on actuarial assumptions.

Actual future liabilities and actuarial deferred inflows and outflows may vary from disclosed estimates.

The disclosure of claims payable in the basic financial statements is based on claims loss reports from third party claims management companies. Actual future liabilities may vary from disclosed estimates.

Significant Difficulties Encountered during the Audit
We encountered no significant difficulties in dealing with management relating to the performance of the audit.

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-4-
Uncorrected and Corrected Misstatements
For purposes of this communication, professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the appropriate level of management. Further, professional standards require us to also communicate the effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole and each applicable opinion unit. There were no uncorrected misstatements noted.

In addition, professional standards require us to communicate to you all material, corrected misstatements that were brought to the attention of management as a result of our audit procedures. Attachment A reflects all material misstatements that we identified as a result of our audit procedures that were brought to the attention of, and corrected by, management.

Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the entity’s financial statements or the auditor’s report. No such disagreements arose during the course of the audit.

Representations Requested from Management
We have requested certain written representations from management, which are included in the attached letter dated March 3, 2025.

Management’s Consultations with Other Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters.

Other Significant Matters, Findings, or Issues
In the normal course of our professional association with the entity, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, significant events or transactions that occurred during the year, operating and regulatory conditions affecting the entity, and operational plans and strategies that may affect the risks of material misstatement. None of the matters discussed resulted in a condition to our retention as the entity’s auditors.

Other Information Included in Annual Reports
Pursuant to professional standards, our responsibility as auditors for other information, whether financial or nonfinancial, included in the entity’s annual reports, does not extend beyond the information identified in the audit report, and we are not required to perform any procedures to corroborate such other information.

However, in accordance with such standards, we have:

Read the transmittal letter and statistical section other information and considered whether a material inconsistency existed between the other the information and the basic financial statements, or the other information otherwise appears to be materially misstated. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon

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-5-
Our responsibility also includes communicating to you any information which we believe is a material misstatement of fact. Nothing came to our attention that caused us to believe that such information, or its manner of presentation, is materially inconsistent with the information, or manner of its presentation, appearing in the financial statements.

This report is intended solely for the information and use of the City Council and management of the entity and is not intended to be and should not be used by anyone other than these specified parties.

Very truly yours,

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Attachment A
Account Description Debit Credit
56-2002 ARPA UNEARNED REVENUE 679,857.19
56-4899 ARPA MISC REVENUE 679,857.19
Total 679,857.19 679,857.19
57-2002 UNEARNED REVENUE 500,000.00
57-3000 FUND BALANCE 500,000.00
Total 500,000.00 500,000.00
88-1301 BUILDINGS 201,587.45
88-1308 CONSTRUCTION IN PROGRESS 247,849.17
88-1311 DEPRECIATION BUILDINGS 22,062.00
88-1311 DEPRECIATION BUILDINGS 66,187.33
88-3003 INVESTMENT IN GEN FIXED ASSETS 22,062.00
88-3003 INVESTMENT IN GEN FIXED ASSETS 201,587.45
88-3003 INVESTMENT IN GEN FIXED ASSETS 247,849.17
88-3003 INVESTMENT IN GEN FIXED ASSETS 66,187.33
Total 537,685.95 537,685.95
89-3000 FUND BALANCE 5,688.00
89-1560 DEFERRED REFUNDING LOSS 5,688.00
Total 5,688.00 5,688.00
89-2750 2015 COP LAUREL PARK 85,000.00
89-3000 FUND BALANCE 85,000.00
Total 85,000.00 85,000.00
10-4900 LEASE ACQUISITION 198,562.00
10-570-5501.1709 RIGHT TO USE ASSET ACQUISITION 198,562.00 Total 198,562.00 198,562.00
10-3208 PERS RESERVE 300,000.00
10-560-5290 ADD'L UAL FUNDING TO TRUST 300,000.00
10-2500.2400 PARS TRUST FUNDING 300,000.00
10-3000 FUND BALANCE 300,000.00
Total 600,000.00 600,000.00
10-570-5501.2401 COMMUNITY CTR ROOF REPAIR 247,849.17
10-2000 AP PENDING (Due to Pool) 247,849.17
Total 247,849.17 247,849.17
51-1301 Equipt Asset 157,085.17
51-2100 Equipt Liability 30,015.32
51-525-5450 Depreciation Expense 13,090.43
51-525-5500 Interest Expense 3,584.68
51-1321 Accum Depreciation 13,090.43
51-2100 Equipt Liability 157,085.17
51-525-5420 EQUIPMENT 33,600.00
Total 203,775.60 203,775.60
Total Adjusting Journal Entries 3,058,417.91 3,058,417.91 Adjusting Journal Entries JE # 103
Adjusting Journal Entries
Adjusting Journal Entries JE # 101
To recognize unearned revenue to CY expenditures
Adjusting Journal Entries JE # 102
To correct fund balance
Adjusting Journal Entries JE # 205
To clear balance in accounts that were revenue/expense accounts, but recognized as balance sheet accounts by City accounting system
To correct for amortization already captured in FY2023 for warehouse lease, to reverse double posting of A/D for warehouse lease, to correct warehouse lease asset, to correct CIP for invoice not accrued Adjusting Journal Entries JE # 104
To amortize deferred charge on refunding
Adjusting Journal Entries JE # 105
To record CY debt service payment
Adjusting Journal Entries JE # 106
To record missed subscription liability addition and related 2024 activity To correct PARS unfunded liability to PERS reserve
Adjusting Journal Entries JE # 206
To accrue additional AP invoice
Adjusting Journal Entries JE # 208

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City of Los Alamitos

CITY COUNCIL AGENDA REPORT
MEETING DATE: March 24, 2025 ITEM NUMBER: 11C
To: Mayor Shelley Hasselbrink & Members of the City Council Presented By: Barbara Biscocho, Finance Manager
Subject: Award Professional Services Agreement with Rogers, Anderson, Malody, & Scott, LLP for Auditing Services

SUMMARY
This report seeks consideration of a Professional Services Agreement with Rogers, Anderson, Malody & Scott (RAMS) for auditing services in the amount of $61,860.

RECOMMENDATION
Authorize the Mayor to enter into a Professional Services Agreement (PSA) with Rogers, Anderson, Malody & Scott, LLP, (RAMS) in an amount not to exceed $61,860 for auditing services for a three-year contract for FY2024-25, 2025-26, and FY2026-27.

BACKGROUND
In fiscal year 2020-21, the City Council approved a contract with Gruber & Associates, CPAs, a CPA firm with local government auditing experience. In 2022, the firm changed ownership and became Gruber & Lopez, Inc. The original contract was for three fiscal years, with two additional single-year options, which the City did not exercise. In the final two fiscal years of the five-year term (2023 and 2024), the City contracted with RAMS, one of the proposers of the original RFP. A new RFP was issued on December 16, 2024, with responses due by January 23, 2025. A report was taken to the Budget Standing Committee at a Special Meeting on February 10, 2025, to discuss and review the results of the RFP.

DISCUSSION
In connection with the RFP, the City received two responses, RAMS and the Pun Group. The current audit firm, RAMS, has served the City well as its auditor for the prior two fiscal years (FY2022-23, FY2023-24). RAMS has assisted with implementing new GASB pronouncements and additional work in connection with lease and subscription accounting. Their proposal is the most qualified for the City's needs and meets all the requirements (Attachment 1). In addition, their cost is less than that proposed by the other firm (Attachment 2). Staff recommends RAMS as the firm best suited to provide the City with auditing services.

FISCAL IMPACT
The contract for auditing services will be for a term of three years, covering fiscal years 2024- 25, 2025-26, and 2026-27, for a not-to-exceed amount of $179,290, with two additional oneyear options (2027-28 and 2028-29). Funding for this is included in Finance Contractual

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Services (10-512-5260).

Attachment: 1. Professional Services Agreement - RAMS

2. Exhibit A - RAMS Proposal

3. RFP Response Cost Comparison

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1 1277023.1

PROFESSIONAL SERVICES AGREEMENT
Rogers, Anderson, Malody & Scott. LLP (RAMS)
THIS PROFESSIONAL SERVICES AGREEMENT (“Agreement”) is made and entered into, to be effective this 1st day of July, 2025, by and between the CITY OF LOS ALAMITOS, a California charter city and municipal corporation, (“City”) and Rogers, Anderson, Malody & Scott LLP (RAMS), LLP., a Limited Liability Partnership, (“Firm”). City and Firm are sometimes hereinafter individually referred to as “Party” and are hereinafter collectively referred to as the “Parties.”

RECITALS
A. City has determined that it requires the services of a qualified firm to provide auditing services for fiscal year 2025, 2026, and 2027, with two one-year options (2028 (“Project”).

B. Firm has submitted to City a written proposal, dated January 23 2025 to provide auditing services for the Project.

C. Firm represents and maintains that it is uniquely qualified by virtue of its experience, training, education, reputation, and expertise, to provide the necessary services to City and has agreed to provide such services as set forth herein.

D. City desires to engage Firm to provide such services subject to the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the promises and mutual obligations, covenants, and conditions contained herein, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

AGREEMENT

1. SERVICES OF FIRM

1.1 Scope of Services and Standard of Performance. Firm shall provide those services set forth in the Letter Proposal, dated January 23, 2025, attached hereto as Exhibit “A” (“Scope of Services” and/or “Project Services”). Firm shall provide the Project Services in compliance with all terms and conditions of this Agreement. Firm warrants that all Project Services shall be performed in a skillful, competent, professional and satisfactory manner in accordance with all standards prevalent in the same profession in the State of California. Firm represents and warrants that it is skilled in the professional discipline necessary to perform the Project Services.

Firm represents and warrants that it and all employees, subconsultants and subcontractors providing any services pursuant to this Agreement shall have sufficient skill and experience to perform the Project Services. All Project Services shall be completed to the reasonable satisfaction of City.

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1.1.1 Resolution of Inconsistencies. In the event of any inconsistency between or among the terms and conditions contained in the main body of this Agreement and the Scope of Services, such inconsistency shall be resolved by applying the provisions in the highest priority of the documents containing such inconsistency, which shall be determined in the following order of declining priority: (1st) the main body of this Agreement; and (2rd) the Scope of Services.

1.2 Compliance with Law. All Project Services shall be provided in accordance with all laws, ordinances, resolutions, statutes, rules, and regulations of City and any federal, state or local governmental agency of competent jurisdiction. Firm shall be liable for all violations of such laws, ordinances, resolutions, statutes, rules and regulations in connection with performance of the Project Services. If Firm performs any Project Services in violation of such laws, ordinances, resolutions, statutes, rules or regulations, Firm shall be solely responsible for all penalties and costs arising therefrom. Firm shall defend, indemnify, and hold City, its officials, officers, employees, agents and volunteers, free and harmless from and against any claim or liability arising out of any failure or alleged failure to comply with such laws, ordinances, resolutions, statutes, rules or regulations.

1.3 Licenses and Permits. Prior to performing any Project Services, Firm shall obtain all licenses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession and perform the Project Services. Firm represents and warrants to City that Firm shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement and any extension, any license, permit, qualification, or approval that is legally required for Firm to perform the Project Services. Firm shall have the sole obligation to pay for any fees, assessments, and taxes, plus applicable penalties and interest, which may be imposed by law and arise from or are necessary for the Firm's performance of the Project Services, and shall defend, indemnify, and hold the City, its officials, officers, employees, agents and volunteers, free and harmless from and against any claim or liability arising out of any failure or alleged failure to obtain such license, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession and perform the Project Services.

1.4 Familiarity with Work. By executing this Agreement, Firm warrants that Firm (a) has thoroughly investigated and considered the Project Services to be performed, (b) has carefully considered how the Project Services should be performed, and (c) fully understands the facilities, difficulties and restrictions attending performance of the Project Services under this Agreement.

1.5 Care in Performance of Project Services. Firm shall adopt reasonable methods during the term of the Agreement to prevent losses or damage to materials, papers or other components of the Project Services, and shall be responsible for all such damages, to persons or property, until acceptance of the Project Services by the City, except such losses or damages as may be caused by City's own negligence.

1.6 Non-Exclusive Agreement. Firm acknowledges that City may enter into agreements with other firms, contractors, consultants, or vendors for services similar to the services that are the subject of this Agreement. Firm further acknowledges that City may have its own employees perform services similar to the services that are the subject of this Agreement.

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2. COMPENSATION

2.1 Maximum Contract Amount. Firm shall be compensated for the Project Services performed, including authorized reimbursements, if any, in accordance with the rates and charges for a term of three years, covering years 2025, 2026, and 2027 , with two
additional one-year options (2028-2029) set forth in the Scope of Services in an amount not to exceed ($ . The
maximum amount of City’s payment obligation under this Agreement is the amount specified in this section.

2.2 Method of Payment. In any month in which Firm wishes to receive payment, Firm shall no later than first working day of such month, submit to the City, in a form approved by the City Manager or his designee, an invoice for services rendered prior to the date of the invoice. Such requests shall be based upon the amount and value of the services performed by Firm and accompanied by such reporting data including an itemized breakdown of all costs incurred and tasks performed during the period covered by the invoice, as may be required by the City. Within thirty (45) calendar days of receipt of invoice, City shall pay all undisputed amounts included on the invoice.

2.3 Changes in Scope. In the event any change or changes in the Scope of Services is requested by the City, the Parties shall execute a written amendment to this Agreement, signed by an individual authorized to formally bind the Party for which he/she is signing, setting forth with particularity all terms of such amendment, including, but not limited to, any additional professional fees. An amendment may be entered into: (a) to provide for revisions or modifications to documents or other work product when documents or other work product or work is required by the enactment or revision of law subsequent to the preparation of any documents, other work product, or work; and/or, (b) to provide for additional services not included in this Agreement or not customarily furnished in accordance with generally accepted practice in Firm’s profession.

2.4 Appropriations. This Agreement is subject to and contingent upon funds being appropriated therefore by the Los Alamitos City Council for each fiscal year covered by the term of this Agreement. If such appropriations are not made, this Agreement shall automatically terminate without penalty to the City.

3. SCHEDULE OF PERFORMANCE

3.1 Time of Essence. Time is of the essence in the performance of this Agreement.

The time for completion of the Project Services to be performed by Firm is an essential condition of this Agreement.

3.2 Schedule of Performance. Firm shall prosecute regularly and diligently the Project Services according to the periods specified in the Scope of Services. When requested by Firm, extensions of the time period(s) specified in the Scope of Services may be approved in writing by the Contract Officer; however, the City shall not be obligated to grant any such extension.

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3.3 Force Majeure. The time for performance of the Project Services may be extended because of any delays due to unforeseeable causes beyond the control and without the fault or negligence of the Firm (financial inability excepted), including, but not limited to, acts of God or of the public enemy, unusually severe weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight embargoes, wars, and/or acts of any governmental agency, including the City, if Firm, within ten (10) calendar days of the commencement of such delay, notifies the City Manager in writing of the causes of the delay. The City Manager shall ascertain the facts and the extent of delay, and extend the time for performing the Services for the period of the enforced delay when and if in the judgment of the City Manager such delay is justified. The City Manager's determination shall be final and conclusive upon the Parties to this Agreement. In no event shall Firm be entitled to recover damages against the City for any delay in the performance of this Agreement, however caused, Firm's sole remedy being extension of the Agreement pursuant to this section.

3.4 Term. Unless earlier terminated as provided elsewhere in this Agreement, this Agreement shall commence upon the Effective Date and shall continue in full force and effect for a period of three years, ending on June 30, 2027, with two additional one-year options (2028- 2029), unless extended by mutual written agreement of the Parties.

4. COORDINATION OF PROJECT SERVICES

4.1 Firm’s Representative. The following principal of Firm is hereby designated as being the principal and representative of Firm authorized to act on its behalf with respect to the Project Services and to make all decisions in connection therewith:Rogers, Anderson, Malody & Scott LLP (RAMS). It is expressly understood that the experience, knowledge, education, capability, expertise, and reputation of the foregoing principal is a substantial inducement for City to enter into this Agreement. Therefore, the foregoing principal shall be responsible during the term of this Agreement for directing all activities of Firm and devoting sufficient time to personally supervise the Project Services performed hereunder. The foregoing principal may not be changed by Firm without prior written approval of the Contract Officer.

4.2 City’s Contract Officer. The City’s Contract Officer shall be Craig Koehler, Finance Director, and is subject to change by the City Manager. It shall be the Firm's responsibility to ensure that the Contract Officer is kept fully informed of the progress of the performance of the Project Services, and the Firm shall refer any decisions which must be made by City to the Contract Officer. Unless otherwise specified herein, any approval of City required hereunder shall mean the approval of the Contract Officer. The Contract Officer shall have authority to sign all documents on behalf of the City required hereunder to carry out the terms of this Agreement.

4.3 Prohibition Against Subcontracting or Assignments. The experience, knowledge, capability, expertise, and reputation of Firm, its principals and employees, were a substantial inducement for City to enter into this Agreement. Therefore, Firm shall not assign the performance of this Agreement, nor any part thereof, nor any monies due hereunder, voluntarily or by operation of law, without the prior written consent of City. Firm shall not contract with any other entity to perform the Project Services without prior written consent of City. If Firm is permitted by City to subcontract any part of this Agreement, Firm shall be responsible to City for

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the acts and omissions of its subcontractor(s) in the same manner as it is for persons directly employed. Nothing contained in this Agreement shall create any contractual relationships between any subcontractor and City. All persons engaged in the performance of Project Services will be considered employees of Firm. City will deal directly with and will make all payments to Firm. In addition, neither this Agreement nor any interest herein may be transferred, assigned, conveyed, hypothecated, or encumbered voluntarily or by operation of law, whether for the benefit of creditors or otherwise, without the prior written consent of City. Transfers restricted hereunder shall include the transfer to any person or group of persons acting in concert of more than twenty five percent (25%) of the present ownership and/or control of Firm, taking all transfers into account on a cumulative basis. In the event of any such unapproved transfer, including any bankruptcy proceeding, this Agreement shall be void. No approved transfer shall release Firm or any surety of Firm from any liability hereunder without the express written consent of City.

4.4 Independent Contractor.

4.4.1 The legal relationship between the Parties is that of an independent contractor; nothing herein shall be deemed to make Firm a City employee. During the performance of this Agreement, Firm and its officers, employees, and agents shall act in an independent capacity and shall not act as City officers or employees. Firm will determine the means, methods and details of performing the Project Services subject to the requirements of this Agreement. The personnel performing the Project Services on behalf of Firm shall at all times be under Firm’s exclusive direction and control. Neither City nor any of its officials, officers, employees, agents or volunteers shall have control over the conduct of Firm or any of its officers, employees, or agents, except as set forth in this Agreement. Firm, its officers, employees or agents, shall not maintain a permanent office or fixed business location at City’s offices. City shall have no voice in the selection, discharge, supervision, or control of Firm’s officers, employees, or agents or in fixing their number, compensation, or hours of service. Firm shall pay all wages, salaries, and other amounts due its employees in connection with the performance of Project Services and shall be responsible for all reports and obligations respecting them, including but not limited to social security income tax withholding, unemployment compensation, workers’ compensation, and other similar matters.

City shall not in any way or for any purpose be deemed to be a partner of Firm in its business or otherwise a joint venturer or a member of any joint enterprise with Firm.

4.4.2 Firm shall not incur or have the power to incur any debt, obligation, or liability against City, or bind City in any manner.

4.4.3 No City benefits shall be available to Firm, its officers, employees, representatives, agents, subconsultants or subcontractors in connection with the performance of any Project Services. Except for professional fees paid to Firm as provided for in this Agreement, City shall not pay salaries, wages, or other compensation to Firm for the performance of any Project Services. City shall not be liable for compensation or indemnification to Firm, its officers, employees, representatives, agents, subconsultants or subcontractors, for injury or sickness arising out of the performance of any Project Services. If for any reason any court or governmental agency determines that the City has financial obligations, other than pursuant to Section 2 herein, of any nature relating to salary, taxes, or benefits of Firm’s officers, employees, representatives, agents, or subconsultants or subcontractors, Firm shall defend, indemnify, and hold harmless City from

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and against all such financial obligations.

4.5 PERS Eligibility Indemnification.

4.5.1 In the event that Firm or any officer, employee, representative, agent, subconsultant or subcontractor of Firm providing any Project Services claims or is determined by a court of competent jurisdiction or the California Public Employee Retirement System (PERS) to be eligible for enrollment in PERS as an employee of the City, Firm shall indemnify, defend, and hold harmless City against (1) all such claims and determinations, (2) for the payment of any employee and/or employer contributions for PERS benefits on behalf of Firm or its officers, employees, representatives, agents, subconsultants or subcontractors, and (3) the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of the City.

4.5.2 Notwithstanding any other agency, state or federal policy, rule, regulation, law or ordinance to the contrary, Firm and any of its officers, employees, representatives, agents, subconsultants or subcontractors providing any Project Services shall not qualify for or become entitled to, and hereby agree to waive any claims to, any compensation, benefit, or any incident of employment by City, including but not limited to eligibility to enroll in PERS as an employee of City and entitlement to any contribution to be paid by City for employer contribution and/or employee contributions for PERS benefits.

5. INSURANCE

5.1 Compliance with Insurance Requirements. Firm shall obtain, maintain, and keep in full force and effect during the term of this Agreement, at its sole cost and expense, and in a form and content satisfactory to City, all insurance required under this section. Firm shall not commence any Project Services unless and until it has provided evidence satisfactory to City that it has secured all insurance required under this section. If Firm’s existing insurance policies do not meet the insurance requirements set forth herein, Firm agrees to amend, supplement or endorse the policies to do so.

5.2 Types of Insurance Required. As a condition precedent to the effectiveness of this Agreement, and without limiting the indemnity provisions set forth in this Agreement, Firm shall obtain and maintain in full force and effect during the term of this Agreement, including any extension thereof, the following policies of insurance:

5.2.1 Professional Liability/Errors and Omissions Insurance ("PLI"). Firm shall obtain and maintain a policy of Professional Liability or Errors and Omissions Insurance appropriate to Firm’s profession with per-claim and aggregate limits of no less than Two Million Dollars ($2,000,000.00). Covered professional services shall specifically include all Project Services to be performed under the Agreement and the policy shall be endorsed to delete any exclusions that may exclude coverage for claims within the minimum PLI limits set forth herein for the Project Services to be performed under this Agreement.

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5.2.1.1 The PLI policy shall be endorsed to delete any Contractual Liability Exclusion. The PLI shall include contractual liability coverage applicable to this Agreement. The policy must “pay on behalf of” the insured, and include a provision establishing the insurer’s duty to defend the insured.

5.2.1.2 If the PLI policy is written on a “claims-made” basis, the policy shall be continued in full force and effect at all times during the term of this Agreement, and for a period of three (3) years from the date of the completion of all Project Services provided hereunder (the "PLI Coverage Period"). If any PLI policy is replaced, cancelled, non-renewed, discontinued, or otherwise terminated, or if the limits of a PLI policy are reduced or the available coverage depleted below the required minimum coverage amounts for any reason during the PLI Coverage Period, Firm shall immediately obtain replacement PLI coverage meeting the requirements of this Section

5.2.1. Such replacement coverage shall satisfy all requirements herein, and shall include coverage for the prior acts or omissions of Firm during the time period during which any Project Services were performed. The coverage shall be evidenced by either a new policy evidencing no gap in coverage, or by obtaining separate extended “tail” coverage with the present or new carrier or other insurance arrangements providing for complete coverage, either of which shall be subject to the written approval by the City.

5.2.1.3 If the PLI policy is written on an “occurrence” basis, the policy shall be continued in full force and effect during the term of this Agreement, or until completion of the Project Services provided for in this Agreement, whichever is later. In the event of termination of the PLI policy during this period, new coverage shall immediately be obtained, and written evidence of the policy shall be immediately provided to the City, to ensure PLI coverage during the entire course of performing the Project services.

5.2.1.4 Firm shall not perform any Project Services at any time during which required types or amounts of PLI insurance are not in effect, and the City shall have no obligation to pay Firm for Project Services performed while required PLI insurance is not in effect.

5.2.2 Commercial General Liability Insurance. Firm shall obtain and maintain, in full force and effect throughout the term of this Agreement, a policy of Commercial General Liability Insurance (CGL). Coverage shall be at least as broad as ISO Form CG 00 01 written on a per occurrence basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits of no less than One Million Dollars ($1,000,000.00) per occurrence and Two Million Dollars ($2,000.000.00) in the general aggregate.

The policy shall not contain any endorsements or provisions limiting coverage for (1) contractual liability, (2) cross liability exclusion for claims or suits by one insured against another, or (3) contain any other exclusion contrary to the Agreement.

5.2.3 Automobile Liability Insurance. Firm shall obtain and maintain, in full force and effect throughout the term of this Agreement, a policy of Automobile Liability Insurance.

Coverage shall be at least as broad as ISO Form CA 00 01 written on a per occurrence basis, covering Code 1 (any auto), or if the Firm has no owned autos, Code 8 (hired) and Code 9 (nonowned), with limits of no less than One Million Dollars ($1,000,000.00) for each occurrence covering bodily injury and property damage.

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5.2.4 Workers’ Compensation Insurance. Firm shall obtain and maintain, in full force and effect throughout the term of this Agreement, a policy of Workers’ Compensation Insurance in at least the minimum statutory amounts, and in compliance with all other statutory requirements, as required by the State of California. Firm agrees to waive and obtain endorsements from its workers’ compensation insurer waiving all subrogation rights under its workers’ compensation insurance policy against the City, its officials, officers, employees, agents and volunteers, and to require each of its subconsultants and subcontractors, if any, to do likewise under their workers’ compensation insurance policies. Firm shall also obtain and maintain, in full force and effect throughout the term of this Agreement, a policy of Employer’s Liability Insurance written on a per occurrence basis with limits of at least One Million Dollars ($1,000,000.00) per accident for bodily injury or disease. Notwithstanding the foregoing, Firm shall not be required to procure either Worker’s Compensation Insurance or Employer’s Liability Insurance if Firm provides written verification to the City that Firm does not have any employees.

5.3 Acceptability of Insurers. Insurance required by this section shall be issued by a licensed company authorized to transact business in the state by the Department of Insurance for the State of California with a current rating of A-:VII or better (if an admitted carrier), or a current rating of A:X or better (if offered by a non-admitted insurer listed on the State of California List of Approved Surplus Lines Insurers (LASLI)), by the latest edition of A.M. Best’s Key Rating Guide, except that the City will accept workers’ compensation insurance from the State Compensation Fund. In the event the City determines that the work or Project Services to be performed under this Agreement creates an increased or decreased risk of loss to the City, the Firm agrees that the minimum limits of the insurance policies may be changed accordingly upon receipt of written notice from the City. Firm shall immediately substitute any insurer whose A.M. Best rating drops below the levels specified herein.

5.4 Specific Insurance Provisions and Endorsements. Required insurance policies shall not be in compliance if they include any limiting provision or endorsement that has not been submitted to the City for written approval. Required insurance policies shall contain the following provisions, or Firm shall provide endorsements on forms approved by the City to add the following provisions to the insurance policies:

5.4.1 CGL and Auto Liability Endorsements. The policy or policies of insurance required by this section for CGL and Automobile Liability Insurance shall be endorsed as follows:

5.4.1.1 Additional Insured. The City, its officials, officers, employees, agents and volunteers, shall be additional insureds with regard to liability and defense of suits or claims arising out of the performance of the Agreement; and

5.4.1.1.1 Additional Insured Endorsements. Additional insured endorsements shall not (1) be restricted to “ongoing operations”, (2) exclude “contractual liability”, (3) restrict coverage to “sole” liability of Firm, or (4) contain any other exclusions contrary to the Agreement; and, the coverage shall contain no special limitations on the scope of protection afforded to additional insureds.

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5.4.1.2 Primary and Non-Contributing Insurance. Each CGL and Automobile Liability Insurance policy shall be endorsed to be primary, and any other insurance, deductible, or self-insurance maintained by the City, its officials, officers, employees, agents or volunteers, shall not contribute with this primary insurance.

5.4.1.3 Waiver of Subrogation. Each CGL and Automobile Liability Insurance policy shall contain or be endorsed to waive subrogation against the City, its officials, officers, employees, agents and volunteers, or shall specifically allow Firm or others providing insurance evidence in compliance with the requirements set forth in this section to waive their right to recovery prior to a loss. Firm hereby agrees to waive its own right of recovery against the City, its officials, officers, employees, agents and volunteers, and Firm hereby agrees to require similar written express waivers and insurance clauses from each of its subconsultants or subcontractors.

5.4.2 Notice of Cancellation. Each policy of any type shall be endorsed to provide that coverage shall not be suspended, voided, cancelled, or modified, or reduced in coverage or in limits, except after thirty (30) calendar days prior written notice has been provided to the City. Notwithstanding the foregoing, if coverage is to be suspended, voided, or cancelled because of Firm’s failure to pay the insurance premium, the notice provided by the insurer to City shall be by not less than ten (10) calendar days prior written notice. (A statement that notice will be provided "in accordance with the policy terms" or words to that effect is inadequate to meet the requirements of this section.)

5.5 Deductibles and Self-Insured Retentions. Any deductible or self-insured retention must be approved in writing by the City in advance. The decision whether to approve or withhold approval of a deductible or self-insured retention shall be made by the City in the City's sole and absolute discretion.

5.6 Evidence of Coverage. Concurrently with the execution of the Agreement, Firm shall deliver certificates of insurance together with original endorsements affecting each of the insurance policies required by this section. Firm shall promptly furnish, at City’s request, copies of actual policies including all declaration pages, endorsements, exclusions and any other policy documents City may require to verify coverage.

5.6.1 Required insurance policies shall not be in compliance if they include any limiting provision or endorsement that has not been submitted to the City for written approval.

5.6.2 Authorized Signatures. The certificates of insurance and original endorsements for each insurance policy shall be signed by a person authorized by that insurer to bind coverage on its behalf.

5.6.3 Renewal/Replacement Policies. At least fifteen (15) calendar days prior to the expiration of any such policy, evidence of insurance showing that such insurance coverage has been renewed or extended shall be filed with the City. If such coverage is cancelled or reduced and not replaced immediately so as to avoid a lapse in the required coverage, Firm shall, within ten (10) calendar days after receipt of written notice of such cancellation or reduction of coverage, file with the City evidence of insurance showing that the required insurance has been reinstated or

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has been provided through another insurance company or companies meeting all requirements of this Agreement.

5.7 Requirements Not Limiting. Requirement of specific coverage or minimum 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. Nothing in this section shall be construed as limiting in any way the indemnification provision contained in this Agreement, or the extent to which Firm may be held responsible for payments of damages to persons or property.

5.8 Enforcement of Agreement (Non-Estoppel). Firm acknowledges and agrees that actual or alleged failure on the part of the City to inform Firm of any non-compliance with any of the insurance requirements set forth in this section imposes no additional obligation on the City nor does it waive any rights hereunder.

5.9 Insurance for Subconsultants. Firm shall either: (1) include all subconsultants or subcontractors engaged in the performance of Project Services on behalf of Firm as additional named insureds under the Firm’s insurance policies; or (2) Firm shall be responsible for causing its subconsultants or subcontractors to procure and maintain the appropriate insurance in compliance with the terms of the insurance requirements set forth in this section, including adding the City, its officials, officers, employees, agents and volunteers, as additional insureds to their respective policies. Firm shall not allow any subconsultant or subcontractor to commence any work or services relating to this Agreement unless and until it has provided evidence satisfactory to City that the subconsultant or subcontractor has secured all insurance required under this section.

5.10 Other Insurance Requirements. The following terms and conditions shall apply to the insurance policies required of Firm and its subconsultants and subcontractors, if any, pursuant to this Agreement:

5.10.1 Firm shall provide immediate written notice to City if (1) any of the insurance policies required herein are terminated, cancelled or suspended, (2) the limits of any of the insurance coverages required herein are reduced, or (3) the deductible or self-insured retention is increased.

5.10.2 All insurance coverage and limits provided by Firm and available or applicable to this Agreement are intended to apply to each insured, including additional insureds, against whom a claim is made or suit is brought to the full extent of the policies. Nothing contained in this Agreement or any other agreement relating to the City or its operations shall limit the application of such insurance coverage.

5.10.3 None of the insurance coverages required herein will be in compliance with the requirements of this section if they include any limiting endorsement which substantially impairs the coverages set forth herein (e.g., elimination of contractual liability or reduction of discovery period), unless the endorsement has first been submitted to the City and approved in writing.

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5.10.4 Certificates of insurance will not be accepted in lieu of required endorsements, and submittal of certificates without required endorsements may delay commencement of the Project. It is Firm’s obligation to ensure timely compliance with all insurance submittal requirements as provided herein.

5.10.5 Firm agrees to ensure that subconsultants and subcontractors, if any, and any other parties involved with the Project who are brought onto or involved in the Project by Firm, provide the same minimum insurance coverage required of Firm. Firm 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. Firm agrees that upon request, all agreements with subcontractors and others engaged in the provision of Project Services will be submitted to the City for review.

5.10.6 Firm agrees to provide immediate written notice to City of any claim, demand or loss against Firm arising out of the work or Project Services performed under this Agreement and for any other claim, demand or loss which may reduce the insurance available to pay claims, demands or losses arising out of this Agreement.

6. INDEMNIFICATION
To the fullest extent permitted by law, Firm shall defend (at Firm’s sole cost and expense with legal counsel reasonably acceptable to City), indemnify and hold the City, its officials, officers, employees, agents and volunteers, free and harmless from any and all claims, demands, orders, causes of action, costs, expenses, liabilities, losses, penalties, judgments, arbitration awards, settlements, damages or injuries of any kind, in law or in equity, including but not limited to property or persons, including wrongful death, (collectively “Claims”) in any manner arising out of, pertaining to, related to, or incident to any alleged acts, errors or omissions, or willful misconduct of Firm, its officers, directors, employees, subconsultants, subcontractors, agents or invitees in connection with performance under this Agreement, or in any manner arising out of, pertaining to, related to, or incident to an alleged breach of this Agreement, including without limitation the payment of all consequential damages, expert witness fees and attorneys’ fees and other related costs and expenses.

Notwithstanding the foregoing, and only to the extent that the Project Services performed by Firm are subject to California Civil Code Section 2782.8, the above indemnity shall be limited, to the extent required by Civil Code Section 2782.8, to claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Firm.

Under no circumstances shall the insurance requirements and limits set forth in this Agreement be construed to limit Firm’s indemnification obligation or other liability hereunder.

Notwithstanding the foregoing, such obligation to defend, hold harmless and indemnify the City, its officials, officers, employees, agents and volunteers, shall not apply to the extent that such Claims are caused by the sole negligence or willful misconduct of that indemnified party.

7. REPORTS AND RECORDS

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7.1 Records. Firm shall keep complete, accurate, and detailed accounts of all time, costs, expenses, and expenditures pertaining in any way to this Agreement. Firm shall keep such books and records as shall be necessary to properly perform the Project Services required by this Agreement and to enable the Contract Officer to evaluate the performance of such Project Services.

The Contract Officer shall have full and free access to such books and records at all reasonable times, including the right to inspect, copy, audit, and make records and transcripts from such records.

7.2 Reports. Firm shall periodically prepare and submit to the Contract Officer such reports concerning the performance of the Project Services as the Contract Officer shall require.

7.3 Ownership of Documents. All drawings, specifications, reports, records, documents, memoranda, correspondence, computations, and other materials prepared by Firm, its employees, subconsultants, subcontractors and agents in the performance of this Agreement shall be the property of City and shall be promptly delivered to City upon request of the Contract Officer or upon the termination of this Agreement, and Firm shall have no claim for further employment or additional compensation as a result of the exercise by City of its full rights of ownership of the documents and materials hereunder. Firm may retain copies of such documents for its own use.

Firm shall have an unrestricted right to use the concepts embodied therein. Firm shall ensure that all of its subconsultants and subcontractors shall provide for assignment to City of any documents or materials prepared by them, and in the event Firm fails to secure such assignment, Firm shall indemnify City for all damages resulting therefrom.

7.4 Release of Documents. Except to the extent otherwise required by law, no drawing, specification, report, record, document, or other material prepared by Firm, its employees, subconsultants, subcontractors and agents in the performance of Project Services shall not be released publicly without the prior written approval of the Contract Officer.

8. ENFORCEMENT OF AGREEMENT

8.1 California Law and Venue. This Agreement shall be construed and interpreted both as to validity and as to performance of the Parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim, or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Orange, State of California, or any other appropriate court in such County, and Firm covenants and agrees to submit to the personal jurisdiction of such court in the event of such action.

8.2 Waiver. No delay or omission in the exercise of any right or remedy of a nondefaulting Party on any default shall impair such right or remedy or be construed as a waiver. No consent or approval of City shall be deemed to waiver or render unnecessary City’s consent to or approval of any subsequent act of Firm. Any waiver by either Party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Agreement.

8.3 Rights and Remedies Cumulative. Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the Parties are

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cumulative and the exercise by either Party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party.

8.4 Legal Action. In addition to any other rights or remedies, either Party may take legal action, in law or in equity, to cure, correct or remedy any default, to recover damages for any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Agreement.

8.5 Termination Prior to Expiration of Term. City reserves the right to terminate this Agreement, at any time, with or without cause, upon thirty (30) calendar days written notice to Firm, except that where the continuation of services would constitute a danger to health, safety or general welfare, the period of notice shall be such shorter time as may be appropriate. Upon receipt of the notice of termination, Firm shall immediately cease all Project Services, except as may be specifically approved by the Contract Officer. Firm shall be entitled to compensation for all Project Services rendered prior to receipt of the notice of termination and for any Project Services authorized by the Contract Officer thereafter.

8.6 Termination for Default of Firm.

8.6.1 Firm’s failure to comply with any provision of this Agreement shall constitute a default.

8.6.2 If the Contract Officer determines that Firm is in default in the performance of any of the terms or conditions of this Agreement, he/she shall notify Firm in writing of such default. If such default is capable of being cured, Firm shall have ten (10) calendar days, or such longer period as City may designate, to cure the default by rendering satisfactory performance. In the event Firm fails to cure its default within such period of time, or if such default is not capable of being cured, City shall have the right, notwithstanding any other provision of this Agreement, to terminate this Agreement without further notice and without prejudice of any remedy to which City may be entitled at law, in equity, or under this Agreement. Firm shall be liable for any and all reasonable costs incurred by City as a result of such default. Compliance with the provisions of this section shall not constitute a waiver of any City right to take legal action in the event that the dispute is not cured, provided that nothing herein shall limit City’s right to terminate this Agreement without cause pursuant to Section 8.5.

8.6.3 If termination is due to the failure of Firm to fulfill its obligations under this Agreement, City may, after compliance with the provisions of Section 8.6.2, take over the Project Services and prosecute the same to completion by contract or otherwise, and Firm shall be liable to the extent that the total direct and indirect costs for completion of the Project Services required hereunder exceeds the Maximum Contract Amount, and City may withhold any payments to Firm for the purpose of set-off toward the cost of completion of the Project Services. The withholding or failure to withhold payments to Firm shall not limit Firm’s liability for completion of the Project Services as provided herein.

8.7 Attorneys’ Fees. In the event any dispute between the Parties with respect to this

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14 1277023.1
Agreement results in litigation or any non-judicial proceeding, the prevailing Party shall be entitled, in addition to such other relief as may be granted, to recover from the non-prevailing Party all reasonable costs and expenses, including but not limited to reasonable attorneys’ fees, expert witness fees, court costs and all fees, costs, and expenses incurred in any appeal or in collection of any judgment entered in such proceeding. To the extent authorized by law, in the event of a dismissal by the plaintiff or petitioner of the litigation or non-judicial proceeding within thirty (30) calendar days of the date set for trial or hearing, the other Party shall be deemed to be the prevailing Party in such litigation or proceeding. For purposes of this section, "Reasonable attorney fees" shall be calculated by multiplying the actual number of hours reasonably expended by the attorney(s) handling the dispute on behalf of the prevailing Party by the hourly rate actually paid by the prevailing Party, but in no case shall the hourly rate exceed Two Hundred and Fifty Dollars ($250.00) per hour.

9. CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION

9.1 Non-liability of City Officers and Employees. No officer or employee of the City shall be personally liable to the Firm, or any successor-in-interest, in the event of any default or breach by the City or for any amount which may become due to the Firm or to its successor, or for breach of any obligation of the terms of this Agreement.

9.2 Covenant Against Discrimination. Firm covenants that, by and for itself, its heirs, executors, assigns, subcontractors, subconsultants and all persons claiming under or through them, that there shall be no discrimination or segregation in the performance of or in connection with this Agreement regarding any person or group of persons on account of race, disability, medical condition, color, creed, religion, sex, sexual orientation, marital status, age, national origin, or ancestry. Firm shall take affirmative action to insure that applicants and employees are treated without regard to their race, disability, medical condition, color, creed, religion, sex, sexual orientation, marital status, national origin, or ancestry.

10. MISCELLANEOUS PROVISIONS

10.1 Confidentiality. Information obtained by Firm in the performance of this Agreement shall be treated as strictly confidential and shall not be used by Firm for any purpose other than the performance of this Agreement without the written consent of the Contract Officer.

10.2 Patent and Copyright Infringement.

10.2.1 To the fullest extent permitted by law, and in lieu of any other warranty by City or Firm against patent or copyright infringement, statutory or otherwise, it is agreed that Firm shall defend at its expense any claim or suit against City on account of any allegation that any item furnished under this Agreement, or the normal use or sale thereof arising out of the performance of this Agreement, infringes upon any presently existing U.S. letters patent or copyright and Firm shall pay all costs and damages finally awarded in any such suit or claim, provided that Firm is promptly notified in writing of the suit or claim and given authority, information and assistance at Firm’s expense for the defense of same, and provided such suit or claim arises out of, pertains to, or is related to the alleged negligence, recklessness or willful misconduct of Firm. However, Firm

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15 1277023.1
will not indemnify City if the suit or claim results from City's alteration of a deliverable where such alteration created the infringement upon any presently existing U.S. letters patent or copyright.

10.2.2 Firm shall have sole control of the defense of any such claim or suit and all negotiations for settlement thereof, Firm shall not be obligated to indemnify City under any settlement made without Firm’s consent or in the event City fails to cooperate in the defense of any suit or claim, provided, however, that such defense shall be at Firm’s expense. If the use or sale of such item is enjoined as a result of the suit or claim, Firm, at no expense to City, shall obtain for City the right to use and sell the item, or shall substitute an equivalent item acceptable to City and extend this patent and copyright indemnity thereto.

10.3 Notices. Any notice, demand, request, consent, approval, or communication either Party desires or is required to give to the other Party or any other person shall be in writing and either served personally during normal hours of operation of the Party receiving the notice, or sent by pre-paid, first-class mail to the address set forth below. Either Party may change its address by notifying the other Party of the change of address in writing. Notice shall be deemed communicated on the day personally served, or two (2) business days from the date of mailing if mailed as provided in this section. Additionally, notices by email will be considered legal notice if such communications include the following text in the Subject field: FORMAL LEGAL NOTICE – RAMS.

To City:

To Firm:

Windmera Quintanar, MMC, City Clerk
City of Los Alamitos
3191 Katella Ave.

Los Alamitos, CA 90720
[email protected]
With copy to:

Michael S. Daudt, City Attorney
Woodruff & Smart, APC
555 Anton Blvd., Suite 1200
Costa Mesa, CA 92626
[email protected]
Rogers, Anderson, Malody & Scott, LLP
735 E. Carnegie Dr. Suite 100
San Bernardino, CA 92408
@ramscpa.net

10.4 Entire Agreement; Amendments in Writing. This Agreement constitutes the entire agreement between the Parties and is intended as an integrated agreement, superseding all prior negotiations, arrangements, agreements, representations, and understandings, if any, made by or among the Parties with respect to the subject matter hereof. No amendments or other modifications of this Agreement shall be binding unless executed in writing by both Parties hereto,

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16 1277023.1
or their respective successors, assigns, or grantees.

10.5 Severability. In the event that any one or more of the phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable by valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or sections of this Agreement, which shall be interpreted to carry out the intent of the Parties hereunder.

10.6 Successors in Interest. This Agreement shall be binding upon and inure to the benefit of the Parties’ successors and assignees.

10.7 Third Party Beneficiary. Except as expressly provided herein, nothing contained in this Agreement is intended to confer, nor shall this Agreement be construed as conferring, any rights, including, without limitation, any rights as a third-party beneficiary or otherwise, upon any entity or person not a party hereto.

10.8 Recitals. The above-stated Recitals are hereby incorporated into the Agreement as though fully set forth herein and each Party acknowledges and agrees that such Party is bound, for purposes of this Agreement, by the same.

10.9 Prevailing Wages. Firm is aware of the requirements of California Labor Code Section 1720, et seq., and 1770, et seq., as well as California Code of Regulations, Title 8, Section 16000, et seq., (“Prevailing Wage Laws”). Firm agrees to fully comply with all applicable federal and state labor laws (including, without limitation, if applicable, the Prevailing Wage Laws). It is agreed by the Parties that, in connection with the work or Project Services provided pursuant to this Agreement, Firm shall bear all risks of payment or non-payment of prevailing wages under California law, and Firm hereby agrees to defend, indemnify, and hold the City, its officials, officers, employees, agents and volunteers, free and harmless from any claim or liability arising out of any failure or alleged failure to comply with the Prevailing Wage Laws. The foregoing indemnity shall survive termination of this Agreement.

10.0 Corporate Authority. Each of the undersigned represents and warrants that (i) the Party for which he/she is executing this Agreement is duly authorized and existing, (ii) he/she is duly authorized to execute and deliver this Agreement on behalf of the Party for which he/she is signing, (iii) by so executing this Agreement, the Party for which he/she is signing is formally bound to the provisions of this Agreement, and (iv) the entering into this Agreement does not violate any provision of any other agreement to which the Party for which he/she is signing is bound.
[SIGNATURES ON NEXT PAGE]

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1277023.1
IN WITNESS WHEREOF, the Parties have executed and entered into this Agreement as of the date first written above.
“City”
City of Los Alamitos
By:

Chet Simmons, City Manager
APPROVED AS TO FORM.

Woodruff, & Smart, APC
By:

Michael S. Daudt
City Attorney
ATTEST:

By:

Windmera Quintanar, MMC
City Clerk
“Firm”
Rogers, Anderson, Malody & Scott. LLP
(RAMS)
By:

Gardenya Duran, CPA Partner
[email protected]
By:

Scott Manno, CPA Partner
[email protected]
17

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1277023.1
EXHIBIT “A”
FIRM’S PROPOSAL/ SCOPE OF SERVICES
DATED: January 2 , 2025

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JANUARY 23, 2025
CITY OF I-iOS ALAMITOS

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES
FOR THE FISCAL YEARS ENDING JUNE 30, 2025, THROUGH 2027 (WITH THE OPTION FOR TWO ONE-YEAR PERIODS)
CONTACT PERSONS:

GARDENYA DURAN, CPA, CGMA
[email protected]
SCOTT W. MANNO, CPA, CGMA
[email protected]
909.889.0871
■

PREPARED BY

ROGERS ANDERSON MALODY & SCOTT, LLP
735 E Carnegie Drive, Suite 100
San Bernardino, CA 92408
LICENSE #2596
FEIN 95-2662063

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CITY OF Los ALAMITOS

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES
Table of Contents
Page
Transmittal letter .........................................................................................................................................i Technical Proposal
License to practice............................................................................................................................1 Independence...................................................................................................................................1 Business license ..............................................................................................................................1 Insurance ..........................................................................................................................................1 Workpaper retention and access to workpapers.............................................................................1 Firm Qualifications and experience .................................................................................................1 About our firm
Capabilities .......................................................................................................................................2 Range of services
Housing Authority and Successor Agency experience
Single Audit experience
ACFR preparation
References
Point of contact.................................................................................................................................5 Partner, supervisory, and staff qualifications and experience Partner and supervisory staff involvement
Staff continuity
Continuing professional education
Assigned personnel
Engagement team resumes
Methodology and approach to work ................................................................................................14 Services to be provided
Engagement approach
Identification of anticipated potential audit problems
Proposed audit segmentation
Level of staff and approximate number of hours assigned to each segment Sample sizes (including for compliance testing)
Intelligent audit technology
Analytical procedures
Understanding of internal control over financial reporting Approach in determining applicable laws and regulations Auditing in a remote environment
Proposed audit timing
Philosophy and ethical standards...................................................................................................24 Why choose RAMS?
Equal opportunity employer
Government Audit Quality Center
Engagement quality control
External quality control review
Disciplinary action
Fee proposal...................................................................................................................................26 Attachment A: Government clients served

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mm
11111
ROGERS, ANDERSON, MALODY & SCOTT, LLr
CERTIFIED PUBLIC ACCOUNTANTS, SINCE 1948
i35 E. Carnegie Dr. Suite I 00
San Bernardino. CA 92408
909 889 0871 T
909 889 5351 F
ramscpa.net

PARTNERS
Scoct W. Manno, CPA. CGMA
Leena Shanbhag. CPA. MST. CGMA
City of Los Alamitos
3191 Katella Avenue
Los Alamitos, CA 90720
Dear Purchasing Officer:

January 23, 2025
Br·adferd A. Welebir. CPA. MllA, CGMA
Jenny W. Liu. CPA. MST
Gardenya Duran. CPA. CGMA
Brianna Schuh, CPA. CGMA
Brenda L. Odle. CPA, MST (Partner Emeritus)
Terry P. Shea, CPA (Parmer Emeritus)

MANAGERS/ STAFF
Seong-Hyea Lee, CPA, MBA
Evelyn Morentin-Barcena, CPA
Vernnica Hernandez, CPA
Laura Arvizu. CPA
John Maldonado. CPA. MSA
Julia Rodriguez Fuentes. CPA, MSA
Demi Hite, CPA
Jeffrey McKennan. CPA
Monica Wysocki, CPA
Jacob We;itherbie, CPA, MSA
Bolim Han. CPA, MAcc
Anny Gonzalez, CPA•

MEMBERS
American !nstitute of
Certified Public Accountants
PCPS Tile A/CPA Alliance
for CPA Firms
Gov€rnmenro/ Audit
Quality Cen[er
California Society of
Certified Public Accountants
Proud Member of
• AlliottGlobalAlliance$
We are pleased to respond, on behalf of Rogers, Anderson, Malady & Scott, LLP, (RAMS) to your request for a proposal regarding professional auditing services. As a recognized industry leader and innovator, our goal for the past 75 years has been to provide honest, objective and high-quality results to all our clients, including governmental organizations such as yours. Our success in these efforts is witnessed by the continued organic growth of our firm and our list of long-term clients, some we have served for over 20 years.

At RAMS, we are committed to providing the highest quality audit possible. We understand the complexity of performing governmental audits and that is why we have a dedicated team of auditors that possess the specialized knowledge and experience to help ensure our audits are planned and executed in a way that maximizes audit efficiency and effectiveness and provides you the highest quality services.

We are aware that City of Los Alamitos (the City) will be reviewing other proposals during this process, but we believe that RAMS would be an exceptional choice for the audit for the following reasons. Our firm:
• Utilizes Teammate Analytics, a suite of more than 200 Computer Aided Audit Tools (CAATs). This software empowers our audit teams with the ability to perform powerful, meaningful data analysis which builds upon our other robust, substantive audit procedures. This value-added service also helps to identify specific transactions or amounts which may be indicative of fraud.
• Performs an intelligent, risk-based audit (using our CAAT) which enables us to focus on key audit areas allowing us to become more efficient resulting in a higher quality audit at a reasonable fee. • Currently provides auditing services to over 70 governmental agencies and not-for-profit organizations, including over 30 cities, most of which have enterprise activities and over 35 special districts. • Developed a comprehensive remote working environment for our audits. All our staff currently have the tools for working remotely in an effective and efficient manner allowing us to still provide a quality audit.

Our ultimate goal is to continue to meet your needs, but in a safe environment.
• Has an established reputation in the governmental and not-for-profit accounting and auditing community for providing excellent, timely service with high quality reporting to our clients.
• Is committed to helping you meet all reporting/auditing deadlines, resolving any issues encountered during your audit (e.g., accounting or auditing, new pronouncements, etc.), and providing you with quality audit services.
-iPage 234 of 408

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STABILITY ACCURACY. TRUST.

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• Understands the audit process can be a stressful experience for you and your staff; we understand tha·tyou will have other commitments and your regular workloads during the audit. We make every effort to ensure the audit process, from the interim fieldwork to the preparation of any required financial reports, will be as trouble-free as possible for you and your staff. We accomplish this by comprehensively planning the audit and utilizing our staff and audit technologies in the. most efficient and effective manner while keeping disruptions and miscommunications to a minimum. • Has audit team members that are personable and easy to work with, yet still focused on the audit.

Through open and responsive communication with all parties involved in the audit process, we work to have the most efficient audit possible by minimizing operational distractions of your staff, while maximizing quality service.
• Has an extensive internal quality control review process to ensure your financial reports meet the highest standards. In addition to the preparation of financial reports by the engagement team and reviewed by the engagement manager, each report is also examined by 2 partners and at least 1 professional proofreader.
• Has assisted many of our clients with the preparation of their Annual Comprehensive Financial Reports, and all our clients that have submitted their reports for the .Government Finance Officers Association (GFOA) or California Society of Municipal Finance Officers (CSMFO) awards have received the awards. Our participation as a GFOA reviewer also indirectly benefits our clients in the quality review process.
• Believes that our fee estimate provides a fair and reasonable investment, commensurate with level of service provided and the experience of the audit team members. While we may not be the lowest bidder, that is not our objective. We focus on delivering the best value and price our prospective engagements accordingly.
• Is a local Southern California firm. All our employees live, work, and shop in the region, allowing our local cities to benefit from our sales and property taxes. • Is independent with respect to the City
• Is an Equal Opportunity Employer
As you will see from our proposal, it was prepared in a clear, concise and simple manner in accordance with the request for proposal. We feel our firm, staff and reputation as a leader in governmental auditing exceeds the need for the excess information you may see in other proposals.

Rogers, Anderson, Malody & Scott, LLP is properly licensed to practice in California, including all the assigned professional staff to the engagement. Mrs. Duran, Partner, and Mr. Manno, Partner, are authorized to represent the firm, are empowered to submit the bid and authorized to sign a contract with the City. We understand the work to be done as listed in the section of this proposal titled Services to be provided. In addition, we will be committed to meeting any agreed upon time frames. This proposal is a firm and irrevocable offer for sixty (90) days.

We can be reached at: 735 E. Carnegie Drive, Suite 100, San Bernardino, CA 92408, (909) 889-0871, [email protected] or [email protected].

Thank you for the opportunity to present our proposal to the City. We will be committed to exceeding your expectations of an auditor and believe this proposal provides you with information about our firm, the service team members and our customized audit approach. We look forward to having a long and mutually beneficial relationship with the City. Please feel free to contact us if you have any questions regarding this proposal.

Respectfully yours,

ROGERS, ANDERSON, MALODY & SCOTT, LLP
•I' AICPA
GAQCMomber
Gardenya Duran CPA, CGMA, Partner
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.·Page 13 of 48
CITY OF Los ALAMITOS

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES
fl' .'{·_.·.,,.. • - ,.. • • .:

General information and experience
License to practice
Rogers, Anderson, Malody & Scott, LLP is licensed to practice in the State of California. Our key professional staff, which includes the partners, managers, and supervisors, are all certified public accountants licensed to practice in the State of California and follow all applicable Board of Accountancy standards.

Independence
Rogers, Anderson, Malady & Scott, LLP is independent of the City and any component units, as defined by general standard number two of the generally accepted auditing standards, and by the second general standard for government auditing in the U.S. Government Accountability Office's Government Auditing Standards.

Business license
If selected, we will obtain a City of Los Alamitos Business License as well as any subcontractors, if applicable.

Insurance
We will obtain the City's minimum insurance requirements of $2,000,000 for Professional Liability, Errors and Omissions, Workers Compensation, Comprehensive General Liability and Auto prior to commencement of audit services.

Workpaper retention and access to workpapers
Our firm will retain audit workpapers for a minimum of five (5) years, unless notified in writing by the City of the need to extend the retention period. In accordance with professional standards, workpapers are available upon requests to regulators.

Firm qualifications and experience
About our firm
We are a local firm founded in 1948 and located at 735 E. Carnegie Drive, Suite 100, San Bernardino, California. We provide a full range of services as expected of a full-service accounting firm. We are one of the oldest, most trusted, and respected CPA firms in Southern California, with over 74 years of public practice experience, specializing in governmental agency and not-for-profit
organization auditing, accounting, and management advisory services. Over sixteen thousand hours per year are devoted to this area of our practice, which includes cities, redevelopment successor agencies, water districts, other special districts, not-forprofit corporations, and joint power authorities. We do not use our government accounting and auditing practice as "fill work" for the firm, it is one of our primary focuses thus allowing us to provide quality services to local governments.

We understand your desire to engage auditors that have a thorough understanding of the ever-changing complex accounting and compliance issues confronting governments today. Our firm has an extensive history of governmental accounting and auditing. During that time, we have gained valuable experience, acquired an in-depth knowledge of, and obtained the technical expertise needed to perform high quality governmental audits. This expertise has enabled us to provide exceptional, high-quality service and to provide solutions at fees we feel represent our value to our clients. In addition, we use our participation in various industry associations to continuously update our knowledge with respect to issues relating to governmental · AICPA
GAQCMember -1-
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CIIY OF Los ALAMITOS

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES
- -,---···•· ·-
Firm qualifications and experience (continued)
accounting, auditing, and operations. Any insight we gain is immediately passed on to our clients if we feel they will benefit from it.

Our firm has a total staff of forty-four people, which includes sixteen certified public accountants. The staff consists of seven partners, five managers, ten supervisors/senior accountants, seventeen staff accountants, and five support staff. The audit staff consists of twenty-one members who devote over 80% of their time to municipal engagements. The engagement team assigned to the City's engagement will consist of the following full-time staff: one audit partner, one audit manager, one audit supervisor, and two to three senior/staff auditors. All personnel are out of our San Bernardino office.

Capabilities
Range of services
Our firm provides various other services in addition to auditing services to governmental entities, including:
• SB 341 compliance (Successor Agencies)
• Internal control agreed upon procedures
• Finance director and accounting support services
• Study and evaluation of financial condition and fiscal policies • Transient Occupancy Tax agreed upon procedures
• Franchise (refuse, cable) agreed upon procedures
,. Accounting policies and procedures
• Cash management studies
• Financing and public bond offering assistance
• Franchise agreement assistance (ambulance, cable, television, refuse, etc.) In addition, the firm provides accounting, auditing, attest, and consulting services to for profit and not-for-profit entities. We also provide tax preparation and tax consulting services to individuals, corporations, and partnerships. We provide our municipal audit clients tax consultation at no extra charge.

Housing Authority and Successor Agency experience
Over the past five fiscal years, the firm has audited the Housing Authorities and Successor Agencies for the following entities:

City of South Pasadena
City of Thousand Oaks
City of San Marcos
City of Moorpark
City of Fillmore
City of Sierra Madre
- City of El Cajon
Town of Yucca Valley
City of Poway
City of San Bernardino
City of La Verne
City of San Jacinto
City of Twentynine Palms
City of La Mesa
City of Rosemead
City of Hawthorne
City of West Covina
City of Claremont
· AICPA'
GAQCMember -2-

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CITY OF Los ALAMITOS
Capabilities (continued)
Single audit experience
Most of our municipal clients, and some of our other governmental and not-for-profit clients, have been subject to an audit in accordance with Uniform Guidance. We recently performed single audits for the following entities:

City of San Bernardino
City of El Cajon
City of San Marcos
City of Twentynine Palms
City of Woodlake
City of Exeter
City of Live Oak
City of Menifee
Elsinore Valley Municipal Water District
City of Imperial Beach
Town of Yucca Valley
City of Thousand Oaks
San Joaquin Regional Rail Commission
City of Hawthorne
Our specialized Single Audits Team is led by Partners and Managers with Intermediate and Advanced Single Audit Certifications issued by the AICPA guaranteeing a successful and thorough engagement.

ACFR preparation
We have extensive experience in the preparation of Annual Comprehensive Financial Reports (ACFR). For the fiscal years ended June 30, 2022 and 2023, our staff prepared over 25 ACFR's, with each entity receiving the Certificate of Achievement for Excellence in Financial Reporting from the GFOA. For the fiscal year ended June 30, 2024, again, our staff prepared over 25 ACFR's for our clients for submittal to the GFOA. In addition, we have helped many cities and special districts develop their first year's report for submittal. Four of our audit partners and four of our supeivisory staff are technical reviewers for the GFOA award program. In addition, we review all the ACFR's for compliance with the GFOA certificate program checklist, as well as addressing any prior year comments, if applicable, to insure they have been addressed.

JS'AICPA
GAQCMember -3-
,
P,.R.OPO'!S'AL FOR PR,O.FESSIONAL AUDITING SERVICES

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V
CITY OF Los ALAMITOS
;
P POSAL FOR PROFESSIONAL AUDITING SERVICES .·_·.·
Capabilities (continued)
References
ii&EC::.2<C - ;:2;-;,1;;'.-ermm7mtffi P:i' E·:-:y;:···.?:· 7;[:. I= i:J· Date: Years ending June 30, 2021 - present
Scope of work: Financial Audit/ACFR*/Single Audit
Project location: San Dimas, California
Total hours: Approximately 350 hours each year
Engagement partner: Mrs. Gardenya Duran
Contact person: Mr. Michael O'Brien Finance Director, (909) 394-6200 Address: 245 E Bonita A-.enue, San Dimas, CA91773
WP.mh,:'. ,,.,.·"?.,."'.,,.•...,.. ,_,,,. ,;; ; · , ..l;l Pffl '. .'J"'.:'' ''!\" :C,.-,., '. ':··y7 ';'." >'r r,11i:•·';,:i M11.l-J- . ..;.:..'.t ;..,_ ·::r;,;.i:.i:JLt.;i...:...::;.'\:ill. .il. l..;J;;. ,tl:•. ,.t.'...L .,,.;..:>,f;. • • • ;;,•,:::,· 1,t Date: Years ending June 30, 2021 - present
Scope of work: Financial Audit/Single Audit
Projectlocation: Imperial Beach, California
Total hours: Approximately 350 hours each year
Engagement partner: Mrs. Gardenya Duran
Contact person: Ms. Lily Flyte, Finance Director, (619) 628-1361 Address: 825 Imperial Beach Blvd, Imperial Beach, CA91932 mma!:;· lti.. .. . •. ; ·-i(.JJEffn
Date:• Years ending June 30, 2019 - present
Scope of work: Financial Audit/AC FR*
Projectlocation: Imperial Beach, California
Total hours: Approximately 250 hours each year
Engagement partner: Mr. Scott Manno
Contact person: Mr. Mike Whitehead, Mmin. Services Director, (310) 377-1577, ext 112 Address:. 4045 Palos Verdes Qrive North, Rolling Hi_lls Estates, CA90274 "
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1 '..I'. , .. .l:.Jti......,,,,.'r1i,;,,,, •; . - , '!..-- • _ ... w- ·-- a._...,, - Date: Years ending June 30, 2018 - present
Scope of work: Financial AudiVACFR*/Single Audit
Projectlocation: San Marcos, California
Total hours: Approximately 400 hours each year
Engagement partner: Mr. Scott Manno
Contact person: Ms. Donna Apar, Finance Director, (760) 744-1050 x3133 Address: 1 Civic Center Drive, San Marcos, CA, 92069
r}: :J:L )JtP.;.1!Lflt tt :3e -r:1::·t"-¥1 t:ms'l!
Date: Years ending June 30, 2013 - present
Scope of work: Financial Audit/ACFR*/Single Audit'Successor ency Project location: El Cajon, California
Total hours: Approximately 400 hours each year
Engagement partner: Mr. Scott Manno
Contact person: Mr. Luca Gonzales, Financial Operations Manager, (619) 441-1543 Address: 200 Civic Center Way, El Cajon, CA92020
"Received the GFOA Certificate of Achievement
See Attachment A for a listing of current and recent government clients seNed. ♦ AICPA
GAQCMember -4-
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fi.t it : - - • • ••• - - --

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES
-,- - • - - .

CIJY OF Los ALAMITOS
Point of contact
Partner, supervisory, and staff qualifications and experience -The quality of service you receive is dependent on the capabilities of the individuals assigned to the engagement, and the manner in which those personnel resources are organized to efficientiy focus their abilities on providing you with the requested audit services. These professionals are highly trained and knowledgeable and have a thorough understanding of the environment in which governmental and not-forprofit entities operate. This experience is a critical component in providing the City with an effective and efficient audit
Our engagement team will provide significant experience coupled with an extensive, practical understanding of governmental accounting and auditing along with a broad business perspective. Each member will have access to a wide range of technical resources and knowledge bases which will enable them to provide the City with practical observations and effective solutions.

Below is our proposed organizational chart for the audit:

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Point of contact (continued)
Partner and supervisory staff involvement
All partners and supervisory staff are working professionals and are actively and continually involved in all aspects of their engagements. We believe that partner and supervisory staff involvement in all areas of the audit is a key aspect of the overall audit process. This involvement includes being on-site for interim and yearend fieldwork, thus facilitating a proper, efficient, and effective audit, with minimal disruption of your staff. In addition, the time spent on-site by the partners and supervisory staff ensures they gain an understanding of the entire City's accounting processes and procedures. This understanding will enable them to evaluate and develop opportunities for efficiency, as well as offer practical and functional advice for improving your accounting processes and procedures.

All professionals on this engagement have worked on audits similar in nature to the City's, therefore, the City will not have to train our engagement team.

Staff continuity
Continuity of audit staff is a principal concern with our firm. In order to retain our staff, we offer extremely competitive wages, opportunities for advancement, generous medical packages, a retirement plan, bonus opportunities, as well as educational benefits. Even with the benefits we provide, we realize we may lose staff at any given time. Knowing this, we plan to provide staff continuity from year to year, which is in the best interest of the City and our firm. Continuity ensures an orderly, efficient, and less disruptive audit experience.

Since we cannot guarantee staff will remain with us, principal supervisory and management staff, including engagement partners, managers, other supervisory staff, and specialists, may be changed if those personnel leave the firm or are promoted. However, the City reserves the right to accept orreject replacements.

We believe that due to the significant involvement of the partners on all our engagements, any staff transition would have a minimal effect on the audit efficiency and effectiveness of subsequent years.

Continuing professional education
Our team of auditor specialists stays current in this highly technical practice area by adhering to, and typically exceeding, the continuing professional education requirements of Government Auditing Standards as well as the State Board of Accountancy guidelines. All professionals at our firm participate in continuing professional education (CPE) programs, which are sponsored by various organizations including the Government Finance Officers Association, the American Institute of Certified Public Accountants, the California State Society of Certified Public Accountants, the California Society of Municipal Finance Officers and the Association of Government Accountants. Participation in these programs helps us to ensure that our clients are serviced with the best trained and most proficient government auditors and accountants available. In addition, we periodically provide in-house training taught by our partners and senior level staff using published resources.

All staff are required to attend fraud and ethics training. It is our goal to provide our professional staff continuing education which exceeds the minimum standard of 80 hours over two years.

In accordance with our firm's Quality Control document and Government Auditing Standards (GAS), all staff members who work on audits subject to GAS are required to complete CPE in accordance with GAS standards which require 24 hours directly related to governmental accounting and auditing.

In addition to the required CPE, we also use the following to increase our technical knowledge: view the Governmental Audit Quality Center Annual Webcast Update and other relevant seminars and review monthly publications from the AICPA, the GFOA, and various other resources. We also attend conferences and seminars sponsored by the GFOA, California Society of Municipal Finance Officers, California State Society of Certified Public Accountants and the California Special Districts Association. •3)AICPA
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Point of contact (continued)
Assigned personnel
It is our goal to provide you with capable, competent, and personable individuals who offer an extensive background, not only in governmental accounting and auditing, but also in general business practices. By doing so, it allows us to offer practical solutions, as well as provide technical support. This enables you to stay at the forefront of governmental accounting and provides you with the support you need in dealing with the complex issues confronting entities such as yours.

In addition, our engagement team has the managerial and supervisory experience to provide the City with a comprehensive audit of the highest quality, while still focusing on personal service. The resumes of the key engagement personnel assigned to the audit are presented below. The following individuals will be assigned to the engagement for the entire contract period (see staff Continuity section of this proposal}:

Gardenya Duran, CPA, CGMA - Partner, Engagement Partner Gardenya is also a municipal audit partner with the firm. She is licensed to practice as a certified public accountant in the State of California. Gardenya has 15 years of public accounting experience and has provided accounting, auditing, and consulting services for municipalities, special districts, water agencies, and various not-for-profit organizations. As the engagement partner, she will be responsible for overall engagement quality, as well as ensuring that the engagement is performed in the most effective and efficient manner. Gardenya will directly oversee all engagement staff while assisting in planning and performing the engagement, as well as reviewing all work-papers prepared during the engagement, in addition to all required reports. Gardenya is a working partner and will be actively and continually involved in all aspects of the engagement.

Scott Manno, CPA - Partner, Concurring Partner
Scott will be the Concurring Partner. He is licensed to practice as a certified public accountant in the State of California. He has over 25 years of practical, governmental accounting and auditing experience. As the concurring partner Scott will work directly with Gardenya in planning and performing the engagement.

In addition, he will provide technical consultation for the engagement team.

Brad Wefebir, CPA, CGMA, MBA - Partner, Quality Control Reviewer Brad will be the Quality Control Reviewer. He is licensed to practice as a certified public accountant in the State of California. He has over 20 years·of practical, governmental accounting and auditing experience. Brad will be responsible for the final quality control review of all released opinions and related reports.

Laura Arvizu, CPA - Engagement Manager
Laura is a manager with the firm and is licensed to practice as a certified public accountant in the State of California. Laura has over 8 years of experience in providing accounting and auditing services for municipalities, special districts, and various nonprofit organizations. As the engagement manager, she will work directly with the audit in-charge and partner, while supervising the engagement team during all phases of the engagement. In conjunction with the audit in-charge, she will also oversee the preparation of any required reports.
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- Point of contact (continued)
Partner and supervisory staff involvement (continued)
Sean Schmidt - Audit Senior
Sean is an Audit Senior with the firm. Sean has over 3 years' experience in providing accounting and auditing services for municipalities, special districts and various nonprofit organizations. As an audit senior, he will work closely with the engagement partner and manager and be responsible for planning the audit, supervising the staff assigned to the engagement, and performing reviews of all work-papers prepared for the engagement. In addition, he will also be responsible for the preparation of any required reports.

Staff level accountants
All staff accountants employed by us and working on governmental audits are qualified to perform such audits. Prior to "audit season", our staff are subject to a rigorous training regimen in which we go over all aspects of our audit process and audit programs ensuring staff members have a solid foundation prior to starting fieldwork. Each staff member is encouraged to take on increased responsibility for engagements previously worked on. This enables our staff to grow on each engagement and allows them to continue to gain the skills and knowledge required to perform the audits.

In summary, we want to emphasize the credentials of the above professionals who will be directly responsible for the quality of service that you will receive. Additionally, our audit team has another attribute that is very important, even though it is intangible -- the professionals assigned to the audits have previously worked together as a multi-disciplined team, thus ensuring a smooth, efficient, and effective audit. We are committed to allocating the necessary resources to ensure that we provide continuity of personnel throughout the term of our relationship with the City.

Full engagement team resumes are provided as follows.
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PROPOSAL FOR PROFESSIONAL AUDITING SERVICES
Point of contact (continued)
Engagement team resumes
Gardenya Duran, CPA, CGMA
'-.._ Engagement Partner
Professional experience
Mrs. Duran joined Rogers, Anderson, Malody & Scott, LLP in 2010, She works primarily on audits of governmental agencies, small to mid-sized businesses, and nonprofit organizations. Currently, Mrs. Duran serves as a technical reviewer for the GFOA ACFR Award program. Prior to joining our firm, she was an Information Systems Technician in the U.S. Navy for nine years.

Education/licenses
Bachelor of Science- California State University, San Bernardino Certified Public Accountant - State of California
Chartered Global Management Accountant - American Institute of Certified Public Accountants
Related professional experience
Partial listing of recent relevant governmental agencies served (*includes enterprise fund accounting):

City of Hawthorne*
,City.of Imperial Beach*
City of Canyon Lake
City of La Mesa
City of Signal Hill*
City of San Jacinto*
City of San Marcos*
City of Thousand Oaks*
City of Aliso Viejo
City of San Bernardino
City of Carpinteria
City of San Dimas
City of Capitola
City of Calimesa
City of West Covina*
City of Santee
Continuing professional education
Mrs. Duran has completed 120 hours of continuing professional education courses in the past three years of which the following select courses are relevant to this engagement:
• Thomson Reuters, Audits of State and Local Governments • American Institute of Certified Public Accountants, Foundations in Governmental Accounting • California Society of CPAs Education Foundation, Governmental Accounting and Auditing Update • American Institute of Certified Public Accountants, Applying A-133 to Nonprofit and Governmental Organizations
Professional affiliations
Mrs_ Duran is a member of the following professional organizations:
• American Institute of Certified Public Accountants (AICPA) • California Society of Certified Public Accountants (CalCPA) • Government Finance Officers Association (GFOA)
• California Society of Municipal Finance Officers (CSMFO) · AICPA.

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\ OPOSAL FOR PROFESSIONAL AUDITING SERVICES
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Point of contact (continued)
Scott W. Manno, CPA, CGMA
Concurring Partner
Professional experience
Mr. Manno began his career with Thomas, Bigbie and Smith in 1995 after serving in the United States Army. He spent six years with the firm primarily working on audits of municipalities, special districts and redevelopment agencies as well as various not-for-profit organizations. He joined Rogers, Anderson, Malady & Scott, LLP in July 2001. Currently, Mr. Manno serves as a technical reviewer for the GFOA ACFR Award program.

In addition, he is part of the California State Society of Certified Public Accountants Governmental Accounting and Auditing Committee which meets periodically to discuss current events, pronouncements, etc.

Education/licenses
Bachelor of Science, Business Administration - California State University, San Bernardino Certified Public Accountant - State of California
Chartered Global Management Accountant - American Institute of Certified Public Accountants Related professional experience
Partial listing of relevant governmental agencies served (*includes enterprise fund accounting):

City of El Cajon*
City of Sierra Madre*
City of Moreno Valley•
City of Claremont*
City of San Jacinto*
Town of Yucca Valley
City of Fillmore*
City of Beaumont*
City of Perris*
City of Menifee
City of La Mesa*
City of Chino*
City of San Marcos*
City of Exeter* •
City of Rolling Hills Est
City of La Verne
City of 29 Palms
City of Loma Linda•
City of Woodlake*
City of Poway*
Mr. Manno has completed over 220 hours of continuing professional education courses over the past three years of which the following select courses are relevant to this engagement:
♦ Government Auditing Standards and Foundations
• 2022 Fraud Review
• Governmental Accounting and Auditing Update
Professional affiliations
Mr. Manno is a member of the following organizations:
• American Institute of Certified Public Accountants (AICPA) • California Society of Certified Public Accountants (CalCPA) • Association of Government Accountants (AGA)
• Association of Certified Fraud Examiners (ACFE)
• Government Finance Officers Association (GFOA)
• California Special Districts Association (CSDA)
• California Society of Municipal Finance Officers (CSMFO) t, AICPA
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Point of contact (continued)
Brad A. Welebir, CPA, CGMA, MBA
Quality Control Partner
Professional experience
Mr. Welebir joined Rogers, Anderson, Malody & Scott, LLP in 2004. He primarily provides audits and advisory services to governmental agencies, small to midsized businesses, and not-for-profit organizations. Mr. Welebir serves as a technical reviewer for the GFOA ACFR Award program. He also serves as the CalCPA Inland Empire chapter chair of the governmental accounting and auditing committee and as the representative for the·chapter at the state committee.

Education/licenses
Master of Business Administration, Accounting Emphasis - California State University, Fullerton
Bachelor of Arts in Business Administration - La Sierra University Certified Public Accountant - State of California
Chartered Global Management Accountant - American Institute of Certified Public Accountants
Refated professionaf experience
Partial listing of relevant governmental agencies served (*includes enterprise fund accounting):

City of Fountain Valley
City of Sierra Madre•
City of Moorpark*
City of Claremont*
Continuing professional education
City of Loma Linda•
City of Fillmore*
City of Rosemead
Town of Yucca Valley
City of San Bernardino
City of Poway*
City of Redondo Beach*
City of Aliso Viejo
City of La Verne
City of Poway
City of San Marcos*
City of San Jacinto*
Mr. Welebir has completed over 120 hours of continuing professional education courses in the past three years of which the following select courses are relevant to this engagement:
• Governmental Accounting and Auditing Update
♦ Single Audit Update
• Auditing Fraud Risk in the Current Environment
• Annual Conference Sessions
♦ GAAP Update
Professionaf affiliations
Mr. Welebir is a member of the following professional organizations:
• American Institute of Certified Public Accountants (AICPA) ♦ California Society of Certified Public Accountants (CalCPA) • Government Finance Officers Association (GFOA)
• California Society of Municipal Finance Officers (CSMFO) • California Special Districts Association (CSDA)
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Point of contact (continued)
Laura Arvizu, CPA
Audit Manager
Professional Experience
Laura is an Audit Manager with the firm. She has over 8 years of experience in providing accounting and auditing services for municipalities, special districts and various nonprofit organizations. As an audit manager, she will work closely with the engagement partner and be responsible for planning the audit, supervising the staff assigned to the engagement, and performing reviews of all workpapers prepared for the engagement. In addition, she will also be responsible for the preparation of any required reports. Currently, Laura serves as a technical reviewer for the GFOA ACFR Award program.

Education
Bachelor of Arts - California State University, San Bernardino Certified Public Accountant - State of California
Related professional experience
Partial listing of relevant governmental agencies served (•includes enterprise fund accounting):

City of Imperial Beach•
City of Twentynine Palms•
City of San Dimas
City of Sierra Madre*
Continuing Professional Education
City of Yorba Linda*
City of Claremont*
City of Fountain Valley*
City of Mission Viejo*
City of El Cajon*
City of Ojai*
City of Wildomar
City of Live Oak""
City of Brawley*
City of La Mesa*
City of Hawthorne*
Ms. Arvizu has completed over 120 hours of continuing professional education courses over the past two years of which the following select courses are relevant to this engagement:
+ GASB Update
• Governmental Accounting and Auditing Update
• Frequent Frauds Found in Government
• Government Risk Assessments
Professional affiliations
Ms. Arvizu is a member of the following professional organizations:
♦ American Institute of Certified Public Accountants (AICPA) • California Society of Certified Public Accountants (CalCPA) ♦ California Society of Municipal Finance Officers (CSMFO) 'AICPA'
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PROPOSAL FOR PROFESSIONAL AUDITING SERVICES Page 25 of 48 Point of contact (continued)
Sean Schmidt
Audit Senior
Professional Expen·ence
Mr. Schmidt joined Rogers, Anderson, Malody & Scott, LLP in May 2021, primarily providing accounting and auditing services for municipalities, special districts, and various nonprofit organizations. As an audit senior, he will work closely with the engagement partner and manager and be responsible for planning the audit, supervising the staff assigned to the engagement, and performing reviews of all workpapers prepared for the engagement. In addition, he will also be responsible for the preparation of any required reports.

Education
Bachelor of Arts in Business Administration - California State University, San Bernardino Master of Science in Accountancy - California State University, San Bernardino Related professional experience
Partial listing of relevant governmental agencies served (*includes enterprise fund accounting):

City of San Dimas
City of Hawthorne*
City of Calabasas*
City of Lorna Linda
Continuing Professional Education
City of Menifee
City of Thousand Oaks*
City of Moreno Valley*
City of Santee
City of Twentynine Palms
City of San Bernardino
City of El Cajon*
City of Santee
Mr. Schmidt has completed the following select courses that are relevant to this engagement:
• Assets and Liabilities: State and Local Governments
• Audits of State and Local Government
• What's Going on at GASB
Professional affiliations
Mr. Schmidt is a member of the following professional organizations:
• American Institute of Certified Public Accountants (AICPA) ♦ California Society of Certified Public Accountants (CalCPA) • California Society of Municipal Finance Officers (CSMFO) '\AICPA
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PROPOSAL FOR PROFESSIONAL AUDITING SERVICES Page 26 of 48 f : -.- .--'r_?! t
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Methodology and approach to work
Services to be provided
The City desires an Annual Comprehensive Financial Report (ACFR) to be audited by the independent auditor for the fiscal year ended June 30, 2025, and each of the subsequent years included in the audit firm's contract with the City. The City will submit the ACFR to the Government Finance Officers' Association (GFOA) for the Certificate of Achievement for Excellence in Financial Reporting Program.

In addition, we shall:
• Apply certain limited procedures related to Management's Discussion and Analysis and Required Supplementary Information and provide an "in-relation-to" report on the combining and individual fund financial statements, including budgetary comparison schedules. In addition, auditors will determine that information provided by the City for the introductory and statistical section of the City's ACFR confirms to amounts reported in the basic financial statements. • Provide opinions as to the compliance with the Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (0MB Uniform Guidance). RAMS is to provide an "in relation-to" report on the Schedule of Expenditures of Federal Awards based on the auditing procedures applied during the audit of the financial statements. Auditors will also review the materials included in the reporting package accompanying the data collection form. • Perform Agreed-Upon Procedures to test compliance with Article XIIIB pertaining to the City's appropriation limit (GANN limit) and prepare an Agreed-Upon Procedures report to the City Council regarding compliance.
• Be available to the City Council or management to answer questions related to the audit. • Assess the ACFR to determine that the requirements of the GFOA Certificate of Achievement in Financial Reporting Program.
• Keep City staff informed of new guidance a.nd developments that may affect municipal accounting and finance.
• Hold meetings prior to the commencement of fieldwork at the beginning of the audit and after the first draft of financial statements has been prepared. The engagement partner will attend the meetings. • Be responsive to questions or requests made by the City during the contract period. • At the request of the City, render additional services to supplement the services listed above or perform additional work. Additional fees and scope of work will be determined by the City and RAMS as an addendum to the contract.
• If an extended scope is determined, we shall provide the City with all ascertainable facts with an estimate of additional services required and the proposed price. • Have the Engagement Partner available to present at City Council Meetings, as required and requested by the City or City Council, for the contract award and for submission of the annual reports. • If requested, prepare the basic financial statements and required supplementary information (RSI) sections of the City's ACFR, including providing the ACFR in PDF format, compliant with ASA, GFOA and Single Audit requirements.
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Methodology and approach to work (continued)
SeNices to be provided (continued)
Our audit(s) will be in accordance with:
• Generally Accepted Auditing Standards as promulgated by the American Institute of Certified Public Accountants, including requirements found in the most recent AICPA audit guide Audits of State and Local Governments.
• Government Auditing Standards issued by the Comptroller of the United States of America. • Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards • (0MB Uniform Guidance).
• Specific auditing standards related to any grant agreement determined to be material by the auditors for purposes of examination of the basic financial statements. • Any other applicable standards for other items outlined in the Scope of Work to be performed and/or reports to be issued.

Reports to be issued:
• Independent Auditor's Report on the fair presentation of the financial statements in conformity with GAAP.
• Independent Auditors' Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards (material weaknesses or significant deficiencies). • Single Audit Report in compliance with requirements applicable to each major federal program and internal control over compliance in accordance with the Uniform Guidance. . • Prepare Management Letter that includes significant and less significant (i.e., reportable and non° reportable) recommendations for improvements to internal control. • We will issue reports to those charged with governance (SAS 114 letters) as required by auditing standards.
• Appropriations (GANN) Limit Agree-Upon Procedures Report RAMS will also perform the following:
• Make an immediate, written notification of all irregularities and illegal acts or indication of illegal acts of which we become aware to the following: City Manager and Attorney. • We will be available to present the audit plan prior to beginning field work, and provide regular updates as listed in the RFP.

Engagement approach
Our engagement approach for your audit will be developed, in part, by using established goals which will enable measurement of the audits progress by the engagement partner and lead auditor. This involves frequent communication between the partner and the engagement team to ensure that all audit objectives are achieved in accordance with our goals and that any issues which may arise are communicated and dealt with on a timely basis. In addition, our in-depth knowledge and expertise in governmental accounting and auditing has allowed us to identify key audit and accounting risks in the government environment. More importantly, the approach provides for a complete reassessment of the control environment in each year's audit and thus enables us to respond to any needed risk assessment changes. ' AICPA:

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f:ROPOSAL FOR PROFESSIONAL AUDITING SE VICES
Methodology and approach to work (continued}
Engagement approach (continued)
Our engagement approach has been developed and refined over many years. The foundation of our approach revolves around the following:
• Knowledge and experience. We have been auditing governmental entities like the City, both large and small, for over 74 years. This experience has allowed us to gain in-depth knowledge of the governmental environment which in turn allows us to perform a more efficient and effective audit. lt also enables us to perform detailed risk assessment procedures allowing us to identify significant audit risk areas within the City arid its control environment.
• Intelligent design. As discussed later in our proposal, all our audits are designed to be intelligent using our powerful audit software/data analytic tools (Engagement and Teammate Anafytics). This allows us to analyze large amounts of data in seconds increasing both the efficiency and, more importantly, the effectiveness of all our audit engagements.
• Oversight. Professional judgment is not developed overnight. Our partners, managers and supervisors have been deeply involved in governmental audits on a continuous basis for most of their professional careers. By having direct partner and manager oversight, we can design audit strategies that result in effective and efficient audits.
• Timeliness. Deadlines are not just "dates" to us, they are professional commitments. All required deadlines will be met.
• Open communication. Open lines of communication with all parties (the engagement team members and City Management and staff) throughout the audit process helps to eliminate "surprises." Proper planning and proper use of experienced engagement personnel tend to provide for an effective and efficient audit process. Consequently, inefficiencies, disruptions, and lack of understanding are kept to a minimum. • Availability. All engagement team members are available throughout the year for any questions or additional consultation. City staff will have direct access to the partner, manager, and other supervisory staff at all times during the engagement, as well as after.
• Cost effectiveness. Our customized audit approach and procedures and our experienced auditors help to reduce your overall audit costs while still providing an effective audit and high-quality reports. • Risk based approach. Our detailed risk assessment procedures will consist of activities performed to obtain an understanding of the City and its environment, including its internal control. Evidence from these activities will provide the basis for our assessment of risks of material misstatement at the financial statement and relevant assertion levels. While performing our risk assessment procedures and we may choose to perform further audit procedures concurrently with risk assessment procedures as deemed necessary. In addition, risk assessment procedures will provide some of the necessary evidence about the relevant assertions related to classes of transactions, account balances, or disclosures and about the operating effectiveness of controls.

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Methodology and approach to work (continued)
Engagement approach (continued)
As indicated in the previous section of the proposal, the overall objective of the engagement with the City is to conduct an audit of the financial statements in accordance with required auditing standards and the expression of an opinion(s} on those financial statements. Beyond that initial objective, we believe that our engagement approach provides certain other value-added characteristics, at no additional cost, that will benefit the City over the long-term:
• All our audits are designed to be performed in an efficient and effective way to minimize disruption to the office operations.
• We offer practical observations and recommendations relating to internal control issues, implementation of accounting standards and the policies and procedures regarding both. • We identify opportunities for operating efficiencies which can be used to decrease operating costs of the City.

Identification of anticipated potential audit problems
One potential problem could be the implementation of any future GASBs. With our deep understanding of governmental accounting and auditing, constant training, and broad resources, we do not anticipate any issues during a GASS implementation. Our approach to any GASB statement implementation would be as follows: gain a thorough understanding of the pronouncement; determine applicability to the City; if applicable, discuss the statement and how it will affect the City with City staff; and provide guidance to City staff on the accounting and financial reporting implications.

Proposed audit segmentation
The following is a summary of the audit team's audit approach for the engagement. The audit will be divided into the following segments:

Segment 1 - Interim testing - planning, pre-audit administration, and internal control testing During this phase of the audit, our principal objectives will be to gather information about the City and its environment, including its internal control over financial reporting.

In order to achieve the desired objectives of this phase of the audit, we will:
• Meet with the City's staff in order to determine convenient dates in which we can begin our audit and to discuss the assistance to be provided by the City's staff. • Hold brainstorming sessions with engagement team members to discuss the susceptibility of the City's financial statements to material misstatement and fraud. • Review and evaluate the City's accounting and reporting processes by reviewing the prior year's audit workpapers, any City-prepared documents such as budgets, in-house financial reports, policies and procedures manuals, minutes of governance meetings, etc., and by using various analytical procedures. Analytical procedures will enhance our understanding of the City and will help us identify areas that may need further assessment and additional testing. • Review and retain copies of any pertinent local, state and federal statutes, regulations, or charters that apply to the City.
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Methodology and approach to work (continued)
Proposed audit segmentation (continued)
• Evaluate the design of controls that are relevant to the audit by obtaining a thorough understanding of the City's internal controls over financial reporting and compliance by documenting key internal control components, utilizing questionnaires, walkthroughs, inquiring of the City's personnE:!I, and observing and reviewing key supporting documentation (a more thorough explanation of this process is discussed later in the technical proposal).
• Test controls, if control risk is to be assessed below maximum, by selecting a sample of transactions within the audit area being tested and reviewing supporting documentation to determine whether the relevant controls are in place and functioning properly. • Document and review with management, any findings noted during the testing of internal controls and provide a preliminary management letter that will include our recommendations for improving any weaknesses in operations. The letter will also include suggestions for improving the efficiency of the City's operations.
• Utilize our powerful audit data analytic software allowing us to analyze large amounts of data in seconds and focusing on areas/transactions that are red flagged.

In addition, we will perform the following procedures related to IT General Controls that "touch" financial data:
• Security access (including physical) controls: evaluate the general system security settings and password parameters; evaluate the process for adding, deleting, and changing security access:
evaluate the access capabilities of various types of users; evaluate access controls to networks and financial applications; evaluate access controls related to data files; and evaluate physical access to networks, servers, etc.
• Computer operations: Evaluate backup and recovery processes and review processes of identifying and handling operational problems.
• System development and system changes: Evaluate processes related to system development and system changes (if applicable).
• Application testing: We will determine if the testing of application controls is deemed necessary based on our professional judgment in the planning stages of the engagement.

This phase of the engagement for the audit will be performed by the audit senior and two/three staff accountants with direct supervision by the audit manager and partner.

Segment 2 - Year-end testing- substantive testing
During this phase of the audit, our principal objectives will be to assess the risk of material misstatement at the financial statement level and specific assertions, design overall responses to assessed risks and further audit procedures, perform substantive tests, and complete the audit and evaluate audit findings, if applicable.

In order to achieve the desired objectives of this phase of the audit, we will:
ti'
• Identify significant risks and develop a detailed audit plan using the results in Segment 1. • Design substantive tests of account balances designed and modified specifically for the City's operations and assessed level of risk. Substantive procedures will consist of testing material balance sheet accounts, material revenue and expenditure/expense accounts along with various analytical procedures as deemed necessary. In addition, various accounts may be confirmed with outside parties (cash, investments, etc.).
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CITY OF Los ALAMITOS

Page 31 of 48 ends

- }$ - '.

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES
- .

Methodology and approach to work (continued)
Proposed audit segmentation (continued)
• Determine whether our testing supports the assessed level of risk initially assigned at the financial statement level and at the assertion level.

This phase of the engagement for the audit will be performed by the senior accountant and two/three staff accountants with direct supervision by the audit manager and partner.

If any proposed audit adjustments are noted during this phase, we will discuss and explain them, in detail, with the appropriate level of management prior to posting.

Segment 3 - Reporting - report preparation/audit conclusion (workpaper review) During this phase of the audit, our principal objectives will be to evaluate whether the financial statements, taken as a whole, are free from material misstatement and form an opinion(s) and issue our report.

In order to achieve the desired objectives of this phase of the audit, we will:
• Determine whether, based on our substantive testing and other procedures, the financial statements, taken as a whole, are free of material misstatement. This will provide the basis for our opinion(s). • Review all audit workpapers to ensure that the audit was performed in accordance with the required standards (GAAS, GAGAS, etc.) and prepare drafts of all required reports by the agreed-upon dates. • Conduct an independent review of the financial statement draft by the engagement's quality control partner and issue all reports by the agreed-upon dates.

This phase of the engagement will be performed by the audit senior and one staff accountant with direct supervision by the audit manager and partner. In addition, the engagement's quality control partner will perform a detailed quality control review of the financial statements.

The above procedures are a general list of procedures to be performed. After our initial review of the City and our detailed risk assessment, we will customize the engagement and gear it towards the needs of the City and the audit itself. In doing so, we will determine which procedures to perform relative to our risk assessment.

All our audits are customized to each entity, helping to ensure a complete, effective, and efficient audit. The foundation of the above approach is based on open communication coupled with a strong knowledge of the City's operations and detailed planning at the initial stages of the audit.

Our firm is dedicated to performing a timely audit engagement. Prior to the start of the audit, we will meet with City staff and decide on adequate timeframes, agreed upon by both the City and us, for the performance of the audit and the release of the financial statements. We will dedicate the necessary resources to meet any agreed upon time frames.

Level of staff and approximate number of hours assigned to each segment 18 54 85
28 71 122
25 17 66
71 142 273
•=excludes Single Audit hours and tax return prepararion hours · AICPA
GAQCMember -19-

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Page 32 of 48 ends

Methodology and approach to work (continued)
Sample sizes (including for compliance testing)
Our sample sizes will be determined in accordance with the AICPA's Audit and Accounting Guide, Audit Sampling, and will be selected using professional judgment or our TeamMate Analytics software, depending upon circumstance, as permitted by Statement on Auditing Standards. Our methods are designed to provide the most audit coverage without expending excess time. Our sample sizes will depend upon our preliminary assessment of control risk, our planned substantive testing and analytical procedures as well as our professional judgement.

We utilize our Computer Aided Audit Tools (CAAT) software, Teammate Analytics, to draw our audit samples.

The software allows us to generate random samples, systematic samples, stratified samples, attributes samples as well as monetary unit samples (also called probability-proportional-to-size or dollar unit sampling).

Intelligent audit technology
Our audits are designed to be intelligent using our powerful audit software tools (Engagement and Teammate Analytics). In addition, all audit team members are linked to each other using wireless connections which enables them to share information at an almost real-time speed. Below are some of the benefits of our audit technologies:
• We utilize Teammate Analytics, a suite of more than 200 dynamic Computer Aided Audit Tools (CAATs). This allows us to analyze large amounts of data In seconds. Using data received directly from the City, we can perform the following: search for duplicate checks, detect transactions occurring on holidays/weekends or during unusual hours, perform Benford's Law analysis, and identify Instances when a vendor has issued multiple invoices with sequential references along with many other tests. The software empowers our audit teams with the ability to perform powerful, meaningful data analysis which will build upon our other value-added services.
• We can create our own analytical schedules allowing for easy analysis of current balances to prior year balance, current vs budget balance, thus reducing significant City staff time. • Once your trial balances and financial statements are entered into our software, we can observe your financial statements in the field allowing us to notice any variances and address them immediately. • We link the financial statement schedules directly to our audit software trial balances, and as a result, we can provide the City with fund financial statements almost immediately after importing the trial balances.
• We can provide the City with our audited trial balances which show the coding of the financial statement schedules for ease of review for City staff. These reports show each account coded to a specific financial statement line item/function as well as journal entries posted during the audit. • We have the capability to perform effective and efficient audits remotely as well. tl'AICP.A:

GAQCMember -20-

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CITY OF Los ALAMITOS

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES

Page 33 of 48 ends

- · ·.·:

Methodology and approach to work (continued)
Analytical procedures
In order to properly utilize analytical procedures, industry background and knowledge are needed. With our firm's long history and qualified staff, we believe we have the necessary knowledge and experience to effectively apply analytical procedures. We will utilize analytical review procedures throughout our audit of the City.
• During the interim phase of our audit, we will compare current and prior year unadjusted balances to determine which areas may need additional analysis; we will also compare current year actual amounts to the City's annual budget (both original and adopted). • During the final phase of our audit, we will perform procedures like those mentioned above, as well as compare certain financial ratios for current and prior years. We will also conduct certain "reasonableness" tests. Any significant variances are investigated further through inquiry and other substantive testing as deemed necessary until resolved to our satisfaction. • Finally, after we have completed our fieldwork, we will compare current and prior year audited balances, keeping in mind expected relationships obtained from our knowledge of the City, similar entities and the general economic environment. In addition, we may choose to use various other analytical techniques such as trend analysis, etc.

Unlike other audit firms, we use analytical procedures to supplement our substantive testing, not supplant them.

Understanding of internal control over financial reporting Our approach to obtaining an understanding of the City's internal control over financial reporting will be performed in accordance with professional .standards as promulgated by the American Institute of Certified Public Accountants -- our understanding will include the Control Environment, Risk Assessment, Control Activities, Information and Communication, and Monitoring. We will use customized procedures which we have developed internally to evaluate your internal control systems. By combining our customized procedures and our detailed knowledge of the City and its environment, we will be able to provide constructive feedback in areas we feel need improvement. In addition to our customized procedures, we will also perform the following:

Control Environment. Through inquiry of the City's personnel, prompted by questionnaires, personal knowledge, and review of the minutes of the governing body meetings, we will obtain an understanding of management's and the governing body's attitudes, awareness, and actions concerning the control environment, focusing on the substance of the controls rather than their form.

Risk Assessment. Through inquiry of the City's personnel and the use of questionnaires, we will obtain sufficient knowledge of the City's risk assessment process to understand how management considers risks relevant to financial reporting objectives and decides upon actions to address those risks. This will include understanding how management identifies risks, estimates the significance of these risks, assesses the likelihood of their occurrence, and relates them to financial reporting.

Control Activities. Certain control procedures will be documented during our analysis of the control environment and the accounting system. However, many specific control procedures will still need to be documented that will focus primarily on the City's major transaction cycles. As mentioned above, we will test the City's control procedures on which we intend to rely on for safeguarding assets from unauthorized use or disposition and detecting/preventing unauthorized transactions. Any flow charts, organizational charts and any other manuals, programs, and financial and management information systems will be analyzed during this process.
· AICPA:

GAQCMember -21-

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CI1Y OF Los ALAMITOS

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES

Page 34 of 48 ends

Methodology and approach to work (continued)
Understanding of internal control over financial reporting (continued) Information and Communication. Through inquiry of the City's personnel, we will identify the major types of transactions engaged in by the City. We will become familiar with the treatment of those transactions, including how the transactions are initiated, the related accounting records, and the manner of processing the transactions. Finally, we will obtain an understanding of the City's financial reporting process used to prepare financial reports, including the approaches used in making accounting estimates and disclosures.

Monitoring. Through inquiry of the City's personnel and the use of questionnaires, we will obtain sufficient knowledge of the major types of activities the City uses fo monitor internal control over financial reporting. We will also determine how those activities are used to initiate corrective actions.

Approach in determining applicable laws and regulations We understand the importance of laws and regulations in planning an audit of a local governmental entity and design all our audits to ensure we test transactions for compliance. As part of our audit process, our audit team will obtain an understanding of the laws and regulations that will have a direct and material effect on the City's financial statements. In determining which laws and regulations are applicable to the City's financial statement audit, we will consult the following sources:
• AICPA Audit and Accounting Guide, Audits of State and Local Governments • California Government Code (investments, GANN limit requirements, etc.) • Applicable State of California laws
• U.S. Government Accountability Office's Government Auditing Standards (The Yellow Book), latest revision
• Applicable contracts/grants of the City
• Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (0MB Uniform Guidance)
After consulting the appiicable sources, we will design our audit to provide reasonable assurance of detecting material instances of noncompliance while continuing to refer to the applicable compliance guideline to ensure changes in compliance are not missed.

Auditing in a remote environment
The availability and use of technology has had a significant impact on the accounting and auditing profession, allowing us to provide professional services across longer distances and more timely than ever before. We have continued to evolve our ability to serve our clients remotely throughout the COVID-19 pandemic and have experienced new efficiencies for both auditor and auditee. We anticipate continuing to perform substantially all our audit work remotely and will work with the City to maximize the remote efficiencies using technology. If the City would like members of the audit team on-site, we will work with City management on determining an acceptable staffing level.

We maintain regular and routine contact with our clients throughout the audit planning, fieldwork, and conclusion phases of the audit with the use of email, phone calls, secure portals, video conferencing, project tracking schedules, and any other means necessary to ensure the timely completion of the audit by any agreed-upon deadlines. Our audit team is very responsive to our clients and we encourage our clients to connect with us throughout the year for any matters that may affect the audit or of a general accounting nature.

We have found this to be mutually beneficial for both our clients and the annual audit work.

Remote auditing has many benefits some tangible, as listed above, others intangible. In performing remote audits, we are bettering our employee's quality of life by reducing unnecessary travel time, reducing traffic congestion on our local freeways while also helping to improve Southern California's air quality.
- AICPA'
GAQCMember -22-

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CITY OF Los ALAMITOS
PROPOSAL FOR PROFESSIONAL AUDITING SERVICES Page 35 of 48 °'",..
,.-
Methodology and approach to work (continued)
Proposed audit timing
• Entrance
conference
to meet with
management
for pre-audit
planning.
• Preliminary
risk Ma /June October November/December
assessment •
procedures.

Contact prior
auditor for •
inquiries and
review of
workpapers.
•
•
•
•.

Obtain an understanding of
systems, internal controls,
and current-year issues.

Assess and evaluate design
and implementation of key
internal controls (including
IT related).

Perform tests of internal
controls as needed.

Identify control deficiencies
Perform detailed risk
assessment procedures.

Draft internal control
comment letter.

Develop detailed audit plan
- provide management with
a detailed listing of items
needed to perform the audit,
including the timing of when
items are needed.
• Pertonn substantive audit
fieldwork, including
substantive analytical
procedures.
• Consider whether audit
evidence is sufficient to
form an opinion.
• Conduct exit conference
with management to
discuss proposed entries,
internal control issues, etc.
• Determine whether, based
on our substantive testing
and other procedures, the
financial statements, taken
as a whole, are free of
material misstatement.
• Review all workpapers.
• Evaluate financial
statements and note
disclosures.
• Perform final analytical
procedures.
• Draft required reports.
• Issue final required reports
by or before agreed upon
date.
• Present to governing body
as needed.
- _AICPA'
GAQCMember -23-
>l,H'-lS, ....,....>.!. so:...;;;v. a•.·.;,.it.QT,. i."" :,cD l'\.lhi.;:..,.ccJ)i;HT'\l.:r, <:JNt:,.)7,tal

Page 259 of 408 ends

CITY OF Los ALAMITOS
PROPOSAL FOR PROFESSIONAL AUDITING SERVICES Page 36 of 48 Philosophy and ethical standards
Why choose RAMS?
Our firm has a long history of providing high-quality professional services to government entities similar to the Agency and has a well-respected reputation in the industry, as partly evidenced by our client satisfaction and retention rates. Our staff are committed to the highest standards in performing quality engagements, and you will find they are very personable and easy to work with. At RAMS, you will always work with professionals who are experienced in governmental audits, and thoroughly informed of current issues facing this rapidly changing field. We focus on efficiency in each engagement by emphasizing detailed planning to mitigate or eliminate surprises and maximize the value of our services to our clients. Our knowledge and involvement in the industry lend to our ability to offer year-round guidance and build lasting relationships with our clients. In addition, RAMS possesses the following:

1. Knowledge. We provide highly trained and knowledgeable staff dedicated to client service. We are available throughout the year to answer questions or to provide guidance on any accounting matter.

2. Quality. A commitment to quality on every engagement is our priority.

3. Experience. A client focused team of experienced auditors and accountants will serve the Agency.

4. Flexibility. A flexible team that will work with your schedule.

5. Value. We provide exceptional client service and quality work at a reasonable and competitive fee.

Equal Opportunity Employer
Our firm is an equal opportunity employer and is committed to providing employment opportunities to all qualified persons regardless of race, color, sex, religion, national origin or handicap. Our staff represents a wide range of cultures and ethnic backgrounds. We provide opportunities for advancement for all staff based on ability, skill and desire to advance.

Governmental Audit Quality Center
As a member of the American Institute of CPAs Governmental Audit Quality Center (the Center), we are committed to adhering to the highest quality standards by voluntarily agreeing to the Center membership requirements, which include designating a partner responsible for the quality of our governmental audit practice, establishing quality control programs, performing annual internal inspection procedures, and making our peer review report findings publicly available. At RAMS, our goal is to continue to enhance our quality initiatives within our governmental audit practice to deliver the highest quality audit services possible.

In addition, the Center provides access to comprehensive resources that will assist us in further enhancing the quality of your audit. The Center membership provides us with timely information on a variety of technical, legislative, and regulatory subjects that we can in turn apply to your audit to help ensure compliance with the appropriate standards and changes in regulations which we pass on to our clients.

Engagement quality control
We have an extensive internal quality control review process to ensure your audit meets the highest standards. In addition to the preparation of financial reports by a senior member of the engagement team, each report is reviewed by the engagement manager/supervisor and then is examined by the engagement partner. Subsequently, a technical review is then performed by the engagement Quality Control partner along with being proofread by at least one professional staff. In addition, all audit workpapers are reviewed by the in-charge auditor and the partner in-charge of the engagement. · AICPA"
GAQCMember -24-
11: I': .,.:.oCCRSOl'I, "LO;) .:..con.u:-
CfPrtl11"0 llt.iBllC AC.OL • t..WI( 50tl:':... HJ.Ill
fl1

Page 260 of 408 ends

CITY OF Los ALAMITOS
PROPOSAL FOR PROFESSIONAL AUDITING SERVICES Page 37 of 48 -
--·
°",,._.,.,...;,,-;,, ·• •
Philosophy and ethical standards (continued)
External quality control review
As a member of the AICPA Private
Companies Practice Section, our firm
has participated in the "Peer Review"
program since 1993 and has been
examined every three years since that
date by an outside, independent firm of
certified public accountants.

Participation in this program ensures
that our engagements, firm policies,
and audit procedures meet the
standards of the AICPA, the Yellow
Book, and the California State Board
of Accountancy. Throughout our
participation in this program, the firm
has only received pass ratings from
the peer reviewers.

During each review, an independent
firm reviews our policies and
procedures and then inspects a
representative sample of engagement
workpapers and reports, including
governmental entities and
engagements subject to the Uniform
Guidance. For the year ended
November 30, 2020, our firm received
a rating of pass which indicates our
auditing practice is suitably designed
and complied with to provide
reasonable assurance of performing
and reporting in conformity with
applicable standards. The results
provide confirmation that the custom
audit approach and procedures we
use are technically sound and in
Grant Bennett Associates
Rtport on lh• Finn'• sv,ttm of QuoU1y Contnll
June 4, 2021
To the ttllltei'S ol R i_A f\Ma':,dy & 'S<.ott. lL..,. md 1h11 ?ttt Rf'.Y.ew C'.omrnitttt of ti--e (.:."V;lar..:JI clCPA>
We rtvtMr y s . ! e 1 1 o f <p,h.:ty lOnt.rol'°"t a<c,.') l'n\l'\g end aud.:tf.«-g rra,;tke ofRog .Md-,r n.

Jw'..ai.OOy &S<ott,. UJ> ftM fv-m) in tffect fat Ul'1 •" ffld \bff 30, i::O.ZO. Our peerre,ri,:wwAs coOOi.;n1-d in act<>mNl(t w.11> u-..S dsfor P.,-lorm'.ng orul 11,po<t".,g onl'c<r !\<-vit!WS m•blisllod by tt-e Pet< R.,;,w brd d t½& Amfflan ins.:.iture ct Certiff d P\..:'ltic.N.c.ou.J:tlt"ti fS ar.1.s). ' A "'lm1.1,y of tt--t m1t.ttt: cb,fflives, W)pt, l ,r,ita1.iorcs. c' . .a:-:::1 tM 9r.oced1.1'-t:$ in ;a Sy:1-te1n Re-.-: a-:; &tsc.ribed :.tlt')eSt.J:r1d nd:P""'6'Jbe iovndat - : ·.{ ....,. •• . ·..;.rhesu-n"'Mry.-,w:ndu<Sf!s:«i .Jtion of h..,---w er:-g. ts !.f.:"M a-s:OO't or n-:ported :.1- i'.or.! m.1ty wit \ a.pp-·1-:ebfo J'!'!'-s!anida ,!
4 i;,y. art e.-.tl ted b'J a P"" rfMfflti'tr> cf .tffll _.,. ,a; p-_."1'."r fV\':-.tW mi""lg. n-..finn is ::,.,looe<rigru,,g • ,ystecn t l <l<,..,;'Y<«-l'Ol ,r,d<omJJ(1'·"9 'Nilh it to pr<Ni<lo \tie f.!'TI will> "'"'°""bl• '"'''""''"cf jl<!ffo,ming .1.,d r<fK>rting in confo=,ty"Mt•ppli<ablo p:s>ft$siooal st•lld>tds••.i:
m!ttw rts.Tr..it fi-:n :IW-'...o !)1.,2b .Jrt:0 fi>p!tN"nfA'f nemed:.i'te e-ng !'nU 00:.med rlOt pcrf'Onned er- •i,a x:f . rtyW::'ti, JHCffS_u,on,;jswr.dd.rd;\ -'lffl apPfC.prl.t-e-r r.dl.:x ',.-UngllrN\. ,,:0hs 1Y"t '1)of quJtity torllrot i! -
-Ila--•
Ol.'s" mpollSib&Lty i'S to eiipre:u Ml opnon on !?v tfp_c'gnd tho )""ite-rn of qw!°'.!Y (et,_t.·d' a.•r::S the t1!7Y''j rompi!Mce 11><:,t,-,.,;, bv.«!
lh"!"nd-°"""4 Consldor_,
El'9"9""'°"" ""<fctro fo.-,..;,ew!r,d;xl,d -ll<= P<- ,...i.,Gov,,,,ma11A,,c,1"'1 al?C<llll,. if'--k;d'n1-' comrJ.=-...xe.a-1. :n lttt Sing·ie Audi1 Ac\ .-:den bUOt 01 ,ff1:i tc F' r...

As ,1 ol Ol-fpet!1"' ·.:e, r«tl-e\..J..P.'o'IS by reo--,,;l.itor; e.nt::t a$ (O l'f.ttf'k.t'ltry th:5- ffrm., tf 1:rfA<abie. in Jn_i1-.g th!& Mtt.:•,1,a;\d ment of o!Jf pnxedc:-.s. ()pir>lo<,
ln :.,JI' opir-,i:>n, sys.tltm .of qu.a!;ty co,n forti-e acc..;untifig x·ld ,Ul!:?-:rrg p<.actkG of R•.)IJeor.. .\rk"J<!r:son, Mliody & S<cn. L:J> lo c. t lor1l'lo ;,,or,,_ Nov,,"'.°"1 >Os 202C,""' '-'1suil.>:,/y dc,i .'led M>d «•"P5<d W1-lft -:.:. p,ev:.:s.e the :mi w.tn r&1 "'1:3t .ai!.Yranc:e of p,triOflr::ng and , portil\Q :n <.:x'lfom.ity"' !fl1:.at:,e pre I.sandd:rds fn rr4(1tri,a;; ttt:Spttds. fl:tmi Q.."l :':"<eMI a r.ifng d f. p,:11 wirh Ole/,r. l :U.,_,,,.{c,:.t..

Rog n;,A.-.d<fSOI"\ t.',l,ody&S<ou.Ul' >i>Sl'l'<li-,•poo•'"''""'<llliog p,m.

Gl>A'lT6ENN€TT PSSCOA11.S
A PROFfSSIONAI. co=;O.TlON
C•rtifo<l Pul>Gc Am••>Lar.U
10850 Gcid Cer.ter 0,1...,. Suite 260
compliance with applicable standards.

Disciplinary action
·ri.,ncho Cord<>va, CA95670
916/922-5109 f/\X 9t6/64H2CO
Prlncevlife, HI ')$122
888/769·7323
The firm has never had any disciplinary action taken or pending against it with state regulatory bodies or professional organizations, nor has it ever had any pending or settled litigation, civil or criminal investigations.

In addition, we are not aware of any federal or state desk reviews or field reviews of its audits during the last three years.

Our firm does not have a record of substandard work.

In addition to the external quality control review, our firm performs in-house monitoring procedures, which mirror the outside peer review procedures, over our audit and attest engagements annually. · AICPA.

GAQCMembar -25-

Page 261 of 408 ends

Attachment A

Page 38 of 48 ends

GOVERNMENT CLIENTS SERVED
GFOA Successor Housing
Government Client Years Served Awards Agency Authority
City of El Cajon 06/30/07 to 06/30/24 Yes Yes Yes
City of Exeter 06/30/17 to 06/30/24
City of Woodlake 06/30/17 to 06/30/24
Town of Yucca Valley 06/30/08 to 06/30/24 Yes Yes Yes
City of San Jacinto 06/30/11 to 06/30/24 Yes Yes
City of La Mesa 06/30/11 to 06/30/24 Yes Yes
City of Menifee 06/30/14 to 06/30/24 Yes
City of San Marcos 06/30/14 to 06/30/24 Yes Yes Yes
City of Loma Linda 06/30/13 to 06/30/24 Yes Yes Yes
City of Sierra Madre 06/30/12 to 06/30/24 Yes Yes Yes
City of Hawthorne 06/30/16 to 06/30/24 Yes Yes Yes
City of Claremont 06/30/16 to 06/30/24 Yes Yes Yes
City of Thousand Oaks 06/30/18 to 06/30/24 Yes Yes Yes
City of Rolling Hills Estates 06/30/19 to 06/30/24 Yes
City of Calabasas 06/30/20 to 06/30/24 Yes
City of San Bernardino 06/30/20 to 06/30/24 Yes
City of Ojai 06/30/20 to 06/30/24
City of Beaumont 06/30/20 to 06/30/24 Yes
City of Moreno Valley 06/30/20 to 06/30/24 Yes
City of Lawndale 06/30/20 to 06/30/24 Yes Yes
Town of Windsor 06/30/19 to 06/30/24
City of San Dimas 06/30/20 to 06/30/24 Yes Yes Yes
City of Imperial Beach 06/30/20 to 06/30/24
City of Santa Paula 06/30/21 to 06/30/24 Yes Yes
City of Santee 06/30/22 to 06/30/24
City of Perris 06/30/22 to 06/30/24
City of Live Oak 06/30/22 to 06/30/24 Yes
City of Wildomar 06/30/22 to 06/30/24
City of Yorba Linda 06/30/22 to 06/30/24 Yes Yes Yes
City of Calimesa 06/30/23 to 06/30/24
City of Carpinteria 06/30/23 to 06/30/24 Yes
City of Goleta 06/30/23 to 06/30/24 Yes
City of Hanford 06/30/23 to 06/30/24 Yes Yes
City of Industry 06/30/23 to 06/30/24 Yes Yes
City of Murrieta 06/30/23 to 06/30/24 Yes Yes Yes
City of Signal Hill 06/30/23 to 06/30/24 Yes Yes
City of Chula Vista 06/30/24
City of Eastvale 06/30/24
City of Fountain Valley 06/30/24
City of Mission Viejo 06/30/24
City of Canyon Lake Accounting support
City of Fontana Accounting support
City of Hemet Accounting support
City of Rolling Hills Accounting support
City of Yucaipa Accounting support
City of Adelanto Accounting support
City of Grand Terrace Accounting support

Page 262 of 408 ends

Attachment A

Page 39 of 48 ends

GOVERNMENT CLIENTS SERVICES (continued)
Government Client Years Served
CSMFO/
GFOA Successor
Awards Agency
Housing
Authority
Crestline Village Water District 04/30/96 to 04/30/24
Crestline-Lake Arrowhead Water 06130/98 to 06/30/24
San Bernardino Valley Muni Water District 06/30/04 to 06/30/24 Elsinore Valley Municipal Water District 06/30/15 to 06/30/24 Yes Pine Cove Water District 06/30/10 to 06/30/24
Consolidated Fire Agencies 06/30/14 to 06/30/24
Successor Agency to the County of SB 06/30/14 to 06/30/24 Capistrano Bay Community Services
District 06/30/13 to 06/30/24
Ventura County Public Fin Authority 06/30/12 to 06/30/24 Nipomo Community Services District 06/30/16 to 06/30/24 Yes San Diego Workforce Partnership 06/30/16 to 06/30/24
Rubidoux Community Services District 06/30/16 to 06/30/24 Upper San Gabriel Valley MWD 06/30/19 to 06/30/24 Yes
Chino Basin Desalter Authority 06/30/19 to 06/30/24 Yes Mountains Recreation and Conservation 06/30/19 to 06/30/24 Palos Verdes Peninsula Transit Authority 06/30/19 to 06/30/24 West Basin Municipal Water District 06/30/20 to 06/30/24 Yes ldyllwild Water District 06/30/11 to 06/30/24
'Big Bear Area Regional Wastewater 06/30/12 to 06/30/24 Yes Mojave Water Agency 06/30/19 to 06/30/24 Yes
Rosamond Community Services District 06/30/15 to 06/30/24 Rossmoor Community Services District 06/30/05 to 06/30/24 Rim of the World Park & Rec. District 06/30/06 to 06/30/24 Heartlands Communications Fae Auth 06/30/07 to 06/30/24 Heartlands Fire Training Authority 06/30/07 to 06/30/24 San Joaquin Regional Rail Commission 06/30/22 to 06/30/24 East Valley Water District 06/30/22 to 06/30/24
Leucadia Wastewater District 06/30/22 to 06/30/24
Las Virgenes Municipal Water District 06/30/22 to 06/30/24 Pomona Valley Transportation Auth 06/30/22 to 06/30/24
Crestline Sanitation District Accounting support
Running Springs Water District Accounting support
Phelan Pinon Hills Community Services
District Accounting support
March Joint Powers Authority Accounting support

Page 263 of 408 ends

Page 40 of 48 ends

CITY OF Los ALAMITOS

PROPOSAL FOR PROFESSIONAL AUDITING SERVICES
Fee Proposal
Option Years
Individual cost for reports 2024-25 2025-26 2026-27 2027-28 2028-29 TOTAL

5. PFC Tax Return Preparation 2,500 2,600 2,700 2,800 2,900 13,500 Total Annual Fee for All Reports lo be Issued
for the Fiscal Year Shall Not Exceed $57,700 $59,730 $61,860 $63,480 $65,200 $307,970 •= far the first major program; each additional program Vfi/1 be $5,000 per program for FY 2025 and 2026, $5,500 for FY 2027 and 2028, and $5,750 for FY 2029
•l'AICPA:

GAOCMember -26-
06£'.llS• .>.:;Oloil5011, t,,lAi..;'.;1)11'• CQrt,!,.!.P (1:Pfl"'IC:.0 :;,1,.Qt.•C ,V.,;O\.l.'HANfS. S'Nt:C 1,•.)

1. City Audit and Related Reports $39,000 $40,400 $41,800 $42,800 $43,900 $207,900

2. Assistance with ACFR Preparation 9,700 10,000 10,400 10,700 11,000 51,800

3. Single Audit Report* 5,700 5,900 6,100 6,300 6,500 30,500

4. Gann Limit 800 830 860 880 900 4,270

Page 264 of 408 ends

ROGEAND-01 NGARCIA

CERTIFICATE OF LIABILITY INSURANCE
COVERAGES CERTIFICATE NUMBER: REVISION NUMBER:

THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS

CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.

INSR

LTR TYPE OF INSURANCE
ADDL
INSD
SUBR

WVD POLICY NUMBER

POLICY EFF
(MM/DD/YYYY)

POLICY EXP
(MM/DD/YYYY) LIMITS
A X COMMERCIAL GENERAL LIABILITY EACH OCCURRENCE $
1,000,000

CLAIMS-MADE X OCCUR DAMAGE TO RENTED
PREMISES (Ea occurrence) $
1,000,000 X X 72SBABH1D9C 1/1/2025 1/1/2026
MED EXP (Any one person) $
10,000
PERSONAL & ADV INJURY $
1,000,000
GEN'L AGGREGATE LIMIT APPLIES PER: GENERAL AGGREGATE $
2,000,000
POLICY X PRO- LOC PRODUCTS - COMP/OP AGG $
2,000,000 JECT
OTHER: $

AUTOMOBILE LIABILITY

COMBINED SINGLE LIMIT
(Ea accident) $
1,000,000
ANY AUTO BODILY INJURY (Per person) $
BODILY INJURY (Per accident) $
X X

PROPERTY DAMAGE
(Per accident) $
A
OWNED

AUTOS ONLY
HIRED

AUTOS ONLY

SCHEDULED
AUTOS

NON-OWNED

AUTOS ONLY
X X 72SBABH1D9C 1/1/2025 1/1/2026
$
X EACH OCCURRENCE $
3,000,000
X

UMBRELLA LIAB

EXCESS LIAB
OCCUR
CLAIMS-MADE AGGREGATE $
3,000,000
A
DED X RETENTION $ 10,000
72SBABH1D9C 1/1/2025 1/1/2026
$
X
PER

STATUTE

OTH- B ER WORKERS COMPENSATION

AND EMPLOYERS' LIABILITY
Y / N
ANY PROPRIETOR/PARTNER/EXECUTIVE X QWC1419242 1/1/2025 1/1/2026 E.L. EACH ACCIDENT $ 1,000,000
(Mandatory in NH) E.L. DISEASE - EA EMPLOYEE $
1,000,000
If yes, describe under
DESCRIPTION OF OPERATIONS below
N / A
E.L. DISEASE - POLICY LIMIT $
1,000,000
C Errors & Omissions 106850737 1/1/2025 1/1/2026 See Below DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached if more space is required) Professional Liability $4,000,000 Per Claim;$4,000,000 Aggregate; $35,000 Per claim Deductible;Retoactive Date: N/A The City of Los Alamitos, its officials, officers, employees, agents and volunteers are listed as additional insured(s) as respects general liability and auto liability per the attached policy forms. Primary wording is included as respects general liability and auto liability per the attached policy form. Waiver of subrogation is included as respects general liability, auto liability, and workers' compensation per the attached policy form. Notice of cancellation will be delivered in accordance with the policy provisions.

The ACORD name and logo are registered marks of ACORD
City of Los Alamitos
3191 Katella Avenue
Los Alamitos, CA 90720

AUTHORIZED REPRESENTATIVE

SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE

THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS.

DATE (MM/DD/YYYY)
12/31/2024
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.

THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER.

IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must have ADDITIONAL INSURED provisions or be endorsed.

If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s).

PRODUCER
Orion Business Insurance and Risk Management Services, Inc. 1250 Corona Pointe Court, Suite 302
Corona, CA 92879
CONTACT Noemi Garcia NAME:

PHONE (626) 773-8488 (A/C, No, Ext):FAX (951) 737-5083 (A/C, No):

E-MAIL
ADDRESS:
[email protected]
INSURER(S) AFFORDING COVERAGE NAIC #
INSURER A : Hartford Underwriters Ins Co 30104

INSURED
Rogers, Anderson, Malody & Scott LLP
735 E. Carnegie Drive
Suite 100
San Bernardino, CA 92408
INSURER B : Sequoia Insurance Company 22985
INSURER C : Travelers Cas&Surety Co of Am 31194
INSURER D :

INSURER E :

INSURER F :

Page 265 of 408 ends

THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. Form SL 30 32 06 21

Page 1 of 3 ends

BLANKET ADDITIONAL INSURED BY CONTRACT
This endorsement modifies insurance provided under the following:

BUSINESS LIABILITY COVERAGE FORM
Except as otherwise stated in this endorsement, the terms and conditions of the Policy apply.

A. The following is added to Section C. WHO IS AN INSURED:

Additional Insureds When Required By Written Contract, Written Agreement Or Permit The person(s) or organization(s) identified in Paragraphs a. through f. below are additional insureds when you have agreed, in a written contract or written agreement, or when required by a written permit issued by a state or governmental agency or subdivision or political subdivision that such person or organization be added as an additional insured on your Coverage Part, provided the injury or damage occurs subsequent to the execution of the contract or agreement, or the issuance of the permit.

A person or organization is an additional insured under this provision only for that period of time required by the contract, agreement or permit.

However, no such person or organization is an additional insured under this provision if such person or organization is included as an additional insured by any other endorsement issued by us and made a part of this Coverage Part.

The insurance afforded to such additional insured will not be broader than that which you are required by the contract, agreement, or permit to provide for such additional insured.

The insurance afforded to such additional insured only applies to the extent permitted by law.

The limits of insurance that apply to additional insureds are described in Section D. LIABILITY AND MEDICAL EXPENSES LIMITS OF INSURANCE. How this insurance applies when other insurance is available to an additional insured is described in the Other Insurance Condition in Section E. LIABILITY AND MEDICAL EXPENSES GENERAL CONDITIONS.
a. Vendors
Any person(s) or organization(s) (referred to below as vendor), but only with respect to "bodily injury" or "property damage" arising out of "your products" which are distributed or sold in the regular course of the vendor's business and only if this Coverage Part provides coverage for "bodily injury" or "property damage" included within the "products-completed operations hazard". (1) The insurance afforded to the vendor is subject to the following additional exclusions:

This insurance does not apply to:
(a) "Bodily injury" or "property damage" for which the vendor is obligated to pay damages by reason of the assumption of liability in a contract or agreement. This exclusion does not apply to liability for damages that the vendor would have in the absence of the contract or agreement; (b) Any express warranty unauthorized by you;
(c) Any physical or chemical change in the product made intentionally by the vendor; (d) Repackaging, except when unpacked solely for the purpose of inspection, demonstration, testing, or the substitution of parts under instructions from the manufacturer, and then repackaged in the original container;
(e) Any failure to make such inspections, adjustments, tests or servicing as the vendor has agreed to make or normally undertakes to make in the usual course of business, in connection with the distribution or sale of the products;
(f) Demonstration, installation, servicing or repair operations, except such operations performed at the vendor's premises in connection with the sale of the product;

Page 266 of 408 ends

THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. Form SL 30 32 06 21

Page 2 of 3 ends

© 2021, The Hartford
(May include copyrighted material of Insurance Services Office, Inc., with its permission) (g) Products which, after distribution or sale by you, have been labeled or relabeled or used as a container, part or ingredient of any other thing or substance by or for the vendor; or (h) "Bodily injury" or "property damage" arising out of the sole negligence of the vendor for its own acts or omissions or those of its employees or anyone else acting on its behalf. However, this exclusion does not apply to:
(i) The exceptions contained in Paragraphs (d) or (f); or (ii) Such inspections, adjustments, tests or servicing as the vendor has agreed to make or normally undertakes to make in the usual course of business, in connection with the distribution or sale of the products.
(2) This insurance does not apply to any insured person or organization from whom you have acquired such products, or any ingredient, part or container, entering into, accompanying or containing such products. b. Lessors Of Equipment
(1) Any person or organization from whom you lease equipment; but only with respect to their liability for "bodily injury", "property damage" or "personal and advertising injury" caused, in whole or in part, by your maintenance, operation or use of equipment leased to you by such person or organization. (2) With respect to the insurance afforded to these additional insureds, this insurance does not apply to any "occurrence" which takes place after you cease to lease that equipment. c. Lessors Of Land Or Premises
(1) Any person or organization from whom you lease land or premises, but only with respect to liability arising out of the ownership, maintenance or use of that part of the land or premises leased to you. (2) With respect to the insurance afforded to these additional insureds, this insurance does not apply to:
(a) Any "occurrence" which takes place after you cease to lease that land or be a tenant in that premises; or
(b) Structural alterations, new construction or demolition operations performed by or on behalf of such person or organization.
d. Architects, Engineers Or Surveyors
(1) Any architect, engineer, or surveyor, but only with respect to liability for "bodily injury", "property damage" or "personal and advertising injury" caused, in whole or in part, by your acts or omissions or the acts or omissions of those acting on your behalf:
(a) In connection with your premises;
(b) In the performance of your ongoing operations performed by you or on your behalf; or (c) In connection with "your work" and included within the "products-completed operations hazard", but only if:
(i) The written contract, written agreement or permit requires you to provide such coverage to such additional insured; and
(ii) This Coverage Part provides coverage for "bodily injury" or "property damage" included within the "products-completed operations hazard".
(2) With respect to the insurance afforded to these additional insureds, the following additional exclusion applies:

This insurance does not apply to "bodily injury", "property damage" or "personal and advertising injury" arising out of the rendering of or the failure to render any professional services, including:
(i) The preparing, approving, or failure to prepare or approve, maps, shop drawings, opinions, reports, surveys, field orders, change orders, designs or drawings and specifications; or (ii) Supervisory, surveying, inspection, architectural or engineering activities.

Page 267 of 408 ends

THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. Form SL 30 32 06 21

Page 3 of 3 ends

© 2021, The Hartford
(May include copyrighted material of Insurance Services Office, Inc., with its permission) damage”, or “personal and advertising injury” arises out of the rendering of or the failure to render any professional service.
e. State Or Governmental Agency Or Subdivision Or Political Subdivision Issuing Permit (1) Any state or governmental agency or subdivision or political subdivision, but only with respect to operations performed by you or on your behalf for which the state or governmental agency or subdivision or political subdivision has issued a permit.
(2) With respect to the insurance afforded to these additional insureds, this insurance does not apply to:
(a) "Bodily injury", "property damage" or "personal and advertising injury" arising out of operations performed for the federal government, state or municipality; or (b) "Bodily injury" or "property damage" included within the "products-completed operations hazard". f. Any Other Party
(1) Any other person or organization who is not in one of the categories or classes listed above in Paragraphs a. through e. above, but only with respect to liability for "bodily injury", "property damage" or "personal and advertising injury" caused, in whole or in part, by your acts or omissions or the acts or omissions of those acting on your behalf:
(a) In the performance of your ongoing operations performed by you or on your behalf; (b) In connection with your premises owned by or rented to you; or (c) In connection with "your work" and included within the "products-completed operations hazard", but only if:
(i) The written contract, written agreement or permit requires you to provide such coverage to such additional insured; and
(ii) This Coverage Part provides coverage for "bodily injury" or "property damage" included within the "products-completed operations hazard".
(2) With respect to the insurance afforded to these additional insureds, the following additional exclusion applies:

This insurance does not apply to "bodily injury", "property damage" or "personal and advertising injury" arising out of the rendering of, or the failure to render, any professional architectural, engineering or surveying services, including:
(a) The preparing, approving, or failure to prepare or approve, maps, shop drawings, opinions, reports, surveys, field orders, change orders, designs or drawings and specifications; or (b) Supervisory, surveying, inspection, architectural or engineering activities.

This exclusion applies even if the claims allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by an insured, if the “bodily injury”, “property damage”, or “personal and advertising injury” arises out of the rendering of or the failure to render any professional service described in Paragraphs f.(2)(a) or f.(2)(b) above.

Page 268 of 408 ends

Form SL 00 00 10 18

Page 1 of 22 ends

BUSINESS LIABILITY COVERAGE FORM
Various provisions in this Policy restrict coverage. Read the entire Policy carefully to determine rights, duties and what is and is not covered.

Throughout this Coverage Part the words "you" and "your" refer to the Named Insured shown in the Declarations. The words "we", "us" and "our" refer to the insurance company shown in the Declarations. "Policy period", as used in this Coverage Part, means the period from the effective date of this Coverage Part to the expiration date of the Coverage Part as stated in the Declarations or the date of cancellation, whichever is earlier.

The word "insured" means any person or organization qualifying as such under Section C. Who Is An Insured.

Other words and phrases that appear in quotation marks have special meaning. Refer to Section F. Liability And Medical Expenses Definitions.

A. COVERAGES

1. Business Liability Coverage (Bodily Injury, Property Damage, Personal And Advertising Injury) Insuring Agreement
a. We will pay those sums that the insured becomes legally obligated to pay as damages because of "bodily injury", "property damage" or "personal and advertising injury" to which this insurance applies. We will have the right and duty to defend the insured against any "suit" seeking those damages. However, we will have no duty to defend the insured against any "suit" seeking damages for "bodily injury", "property damage" or "personal and advertising injury" to which this insurance does not apply.

We may, at our discretion, investigate any "occurrence" or offense and settle any claim or "suit" that may result.

But:
(1) The amount we will pay for damages is limited as described in Section D. Liability And Medical Expenses Limits Of Insurance; and
(2) Our right and duty to defend ends when we have used up the applicable limit of insurance in the payment of judgments, settlements or medical expenses to which this insurance applies.

No other obligation or liability to pay sums or perform acts or services is covered unless explicitly provided for under Coverage Extension - Supplementary Payments.
b. This insurance applies:
(1) To "bodily injury" and "property damage" only if:
(a) The “bodily injury” or “property damage” is caused by an “occurrence” that takes place in the “coverage territory”;
(b) The "bodily injury" or "property damage" occurs during the policy period; and (c) Prior to the policy period, no insured listed under Paragraph 1. of Section C. Who Is An Insured and no "employee" authorized by you to give or receive notice of an "occurrence" or claim, knew that the "bodily injury" or "property damage" had occurred, in whole or in part. If such a listed insured or authorized "employee" knew, prior to the policy period, that the "bodily injury" or "property damage" occurred, then any continuation, change or resumption of such "bodily injury" or "property damage" during or after the policy period will be deemed to have been known prior to the policy period. (2) To "personal and advertising injury" caused by an offense arising out of your business, but only if the offense was committed in the "coverage territory" during the policy period. c. "Bodily injury" or "property damage" will be deemed to have been known to have occurred at the earliest time when any insured listed under Paragraph 1. of Section C. Who Is An Insured or any "employee" authorized by you to give or receive notice of an "occurrence" or claim:
(1) Reports all, or any part, of the "bodily injury" or "property damage" to us or any other insurer; (2) Receives a written or verbal demand or claim for damages because of the "bodily injury" or "property damage"; or

Page 269 of 408 ends

Form SL 00 00 10 18

Page 2 of 22 ends

© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (3) Becomes aware by any other means that "bodily injury" or "property damage" has occurred or has begun to occur.
d. Damages because of "bodily injury" include damages claimed by any person or organization for care, loss of services or death resulting at any time from the "bodily injury". e. Incidental Medical Malpractice
(1) "Bodily injury" arising out of the rendering of or failure to render professional health care services as a physician, dentist, nurse, emergency medical technician or paramedic shall be deemed to be caused by an "occurrence", but only if:
(a) The physician, dentist, nurse, emergency medical technician or paramedic is employed by you to provide such services; and
(b) You are not engaged in the business or occupation of providing such services. (2) For the purpose of determining the limits of insurance for incidental medical malpractice, any act or omission together with all related acts or omissions in the furnishing of these services to any one person will be considered one "occurrence".

2. Medical Expenses
Insuring Agreement
a. We will pay medical expenses as described below for "bodily injury" caused by an accident:
(1) On premises you own or rent;
(2) On ways next to premises you own or rent; or
(3) Because of your operations;
provided that:
(1) The accident takes place in the "coverage territory" and during the policy period; (2) The expenses are incurred and reported to us within three years of the date of the accident; and (3) The injured person submits to examination, at our expense, by physicians of our choice as often as we reasonably require.
b. We will make these payments regardless of fault. These payments will not exceed the applicable limit of insurance. We will pay reasonable expenses for:
(1) First aid administered at the time of an accident;
(2) Necessary medical, surgical, x-ray and dental services, including prosthetic devices; and (3) Necessary ambulance, hospital, professional nursing and funeral services.

3. Coverage Extension - Supplementary Payments
a. We will pay, with respect to any claim we investigate or settle, or any "suit" against an insured we defend:
(1) All expenses we incur.
(2) Up to $1,000 for the cost of bail bonds required because of accidents or traffic law violations arising out of the use of any vehicle to which Business Liability Coverage for "bodily injury" applies. We do not have to furnish these bonds.
(3) The cost of appeal bonds or bonds to release attachments, but only for bond amounts within the applicable limit of insurance. We do not have to furnish, finance, arrange for, guarantee, or collateralize these bonds, whether the collateralization is characterized as premium or not. (4) All reasonable expenses incurred by the insured at our request to assist us in the investigation or defense of the claim or "suit", including actual loss of earnings up to $500 a day because of time off from work. (5) All court costs taxed against the insured in the "suit". However, such costs do not include attorneys’ fees, attorneys’ expenses, witness or expert fees, or any other expenses of a party taxed against the insured. (6) Prejudgment interest awarded against the insured on that part of the judgment we pay. If we make an offer to pay the applicable limit of insurance, we will not pay any prejudgment interest based on that period of time after the offer.

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Form SL 00 00 10 18

Page 3 of 22 ends

© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (7) All interest on the full amount of any judgment that accrues after entry of the judgment and before we have paid, offered to pay, or deposited in court the part of the judgment that is within the applicable limit of insurance.

Any amounts paid under (1) through (7) above will not reduce the Limits of Insurance. b. If we defend an insured against a "suit" and an indemnitee of the insured is also named as a party to the "suit", we will defend that indemnitee if all of the following conditions are met:
(1) The "suit" against the indemnitee seeks damages for which the insured has assumed the liability of the indemnitee in a contract or agreement that is an "insured contract"; (2) This insurance applies to such liability assumed by the insured; (3) The obligation to defend, or the cost of the defense of, that indemnitee, has also been assumed by the insured in the same "insured contract";
(4) The allegations in the "suit" and the information we know about the "occurrence" are such that no conflict appears to exist between the interests of the insured and the interest of the indemnitee; (5) The indemnitee and the insured ask us to conduct and control the defense of that indemnitee against such "suit" and agree that we can assign the same counsel to defend the insured and the indemnitee; and (6) The indemnitee:
(a) Agrees in writing to:
(i) Cooperate with us in the investigation, settlement or defense of the "suit"; (ii) Immediately send us copies of any demands, notices, summonses or legal papers received in connection with the "suit";
(iii) Notify any other insurer whose coverage is available to the indemnitee; and (iv) Cooperate with us with respect to coordinating other applicable insurance available to the indemnitee; and
(b) Provides us with written authorization to:
(i) Obtain records and other information related to the "suit"; and (ii) Conduct and control the defense of the indemnitee in such "suit".

So long as the above conditions are met, attorneys' fees incurred by us in the defense of that indemnitee, necessary litigation expenses incurred by us and necessary litigation expenses incurred by the indemnitee at our request will be paid as Supplementary Payments.

Notwithstanding the provisions of Paragraph 1.b.(b) of Section B. Exclusions, such payments will not be deemed to be damages for "bodily injury" and "property damage" and will not reduce the Limits of Insurance.

Our obligation to defend an insured's indemnitee and to pay for attorneys' fees and necessary litigation expenses as Supplementary Payments ends when:
(1) We have used up the applicable limit of insurance in the payment of judgments or settlements; or (2) The conditions set forth above, or the terms of the agreement described in Paragraph (6) above, are no longer met.

B. EXCLUSIONS

1. Applicable To Business Liability Coverage
This insurance does not apply to:
a. Expected Or Intended Injury
(1) "Bodily injury" or "property damage" expected or intended from the standpoint of the insured. This exclusion does not apply to "bodily injury" or "property damage" resulting from the use of reasonable force to protect persons or property; or
(2) "Personal and advertising injury" arising out of an offense committed by, at the direction of or with the consent or acquiescence of the insured with the expectation of inflicting "personal and advertising injury".

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Form SL 00 00 10 18

Page 4 of 22 ends

© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) b. Contractual Liability
(1) "Bodily injury" or "property damage"; or
(2) "Personal and advertising injury"
for which the insured is obligated to pay damages by reason of the assumption of liability in a contract or agreement.

This exclusion does not apply to liability for damages because of:
(a) "Bodily injury", "property damage" or "personal and advertising injury" that the insured would have in the absence of the contract or agreement; or
(b) "Bodily injury" or "property damage" assumed in a contract or agreement that is an "insured contract", provided the "bodily injury" or "property damage" occurs subsequent to the execution of the contract or agreement. Solely for the purpose of liability assumed in an "insured contract", reasonable attorneys' fees and necessary litigation expenses incurred by or for a party other than an insured are deemed to be damages because of "bodily injury" or "property damage" provided:
(i) Liability to such party for, or for the cost of, that party’s defense has also been assumed in the same "insured contract"; and
(ii) Such attorneys' fees and litigation expenses are for defense of that party against a civil or alternative dispute resolution proceeding in which damages to which this insurance applies are alleged.
c. Liquor Liability
"Bodily injury" or "property damage" for which any insured may be held liable by reason of:
(1) Causing or contributing to the intoxication of any person; (2) The furnishing of alcoholic beverages to a person under the legal drinking age or under the influence of alcohol;
(3) Providing or failing to provide transportation with respect to any person that may be under the influence of alcohol; or
(4) Any statute, ordinance or regulation relating to the sale, gift, distribution or use of alcoholic beverages.

This exclusion applies even if the claims allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by an insured, if the “bodily injury” or “property damage” involved that which is described in Paragraph (1), (2), (3) or (4) above.

However, this exclusion applies only if you are in the business of manufacturing, distributing, selling, serving or furnishing alcoholic beverages. For the purposes of this exclusion, permitting a person to bring alcoholic beverages on your premises, for consumption on your premises, whether or not a fee is charged or a license is required for such activity, is not by itself considered the business of selling, serving, or furnishing alcoholic beverages.
d. Workers' Compensation And Similar Laws
Any obligation of the insured under a workers' compensation, disability benefits or unemployment compensation law or any similar law.
e. Employer’s Liability
"Bodily injury" to:
(1) An "employee" of the insured arising out of and in the course of:
(a) Employment by the insured; or
(b) Performing duties related to the conduct of the insured’s business; or (2) The spouse, child, parent, brother or sister of that "employee" as a consequence of (1) above.

This exclusion applies:
(1) Whether the insured may be liable as an employer or in any other capacity; and (2) To any obligation to share damages with or repay someone else who must pay damages because of the injury.

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Form SL 00 00 10 18

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) This exclusion does not apply to liability assumed by the insured under an "insured contract". f. Pollution
(1) "Bodily injury", "property damage" or "personal and advertising injury" arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of "pollutants":
(a) At or from any premises, site or location which is or was at any time owned or occupied by, or rented or loaned to any insured. However, this paragraph does not apply to:
(i) "Bodily injury" if sustained within a building and caused by smoke, fumes, vapor or soot produced by or originating from equipment that is used to heat, cool or dehumidify the building, or equipment that is used to heat water for personal use, by the building's occupants or their guests; (ii) "Bodily injury" or "property damage" for which you may be held liable, if you are a contractor and the owner or lessee of such premises, site or location has been added to this Coverage Part as an additional insured with respect to your ongoing operations performed for that additional insured at that premises, site or location and such premises, site or location is not and never was owned or occupied by, or rented or loaned to, any insured, other than that additional insured; or (iii) "Bodily injury" or "property damage" arising out of heat, smoke or fumes from a "hostile fire"; (b) At or from any premises, site or location which is or was at any time used by or for any insured or others for the handling, storage, disposal, processing or treatment of waste; (c) Which are or were at any time transported, handled, stored, treated, disposed of, or processed as waste by or for:
(i) Any insured; or
(ii) Any person or organization for whom you may be legally responsible; (d) At or from any premises, site or location on which any insured or any contractors or subcontractors working directly or indirectly on any insured's behalf are performing operations if the "pollutants" are brought on or to the premises, site or location in connection with such operations by such insured, contractor or subcontractor. However, this paragraph does not apply to:
(i) "Bodily injury" or "property damage" arising out of the escape of fuels, lubricants or other operating fluids which are needed to perform the normal electrical, hydraulic or mechanical functions necessary for the operation of "mobile equipment" or its parts, if such fuels, lubricants or other operating fluids escape from a vehicle part designed to hold, store or receive them. This exception does not apply if the "bodily injury" or "property damage" arises out of the intentional discharge, dispersal or release of the fuels, lubricants or other operating fluids, or if such fuels, lubricants or other operating fluids are brought on or to the premises, site or location with the intent that they be discharged, dispersed or released as part of the operations being performed by such insured, contractor or subcontractor;
(ii) "Bodily injury" or "property damage" sustained within a building and caused by the release of gases, fumes or vapors from materials brought into that building in connection with operations being performed by you or on your behalf by a contractor or subcontractor; or (iii) "Bodily injury" or "property damage" arising out of heat, smoke or fumes from a "hostile fire"; or (e) At or from any premises, site or location on which any insured or any contractors or subcontractors working directly or indirectly on any insured’s behalf are performing operations if the operations are to test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way respond to, or assess the effects of, "pollutants".
(2) Any loss, cost or expense arising out of any:
(a) Request, demand, order or statutory or regulatory requirement that any insured or others test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way respond to, or assess the effects of, "pollutants"; or
(b) Claim or “suit” by or on behalf of a governmental authority for damages because of testing for, monitoring, cleaning up, removing, containing, treating, detoxifying or neutralizing, or in any way responding to, or assessing the effects of, "pollutants".

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) However, this paragraph does not apply to liability for damages because of "property damage" that the insured would have in the absence of such request, demand, order or statutory or regulatory requirement, or such claim or "suit" by or on behalf of a governmental authority. g. Aircraft, Auto Or Watercraft
(1) Unmanned Aircraft
"Bodily injury" or "property damage" arising out of the ownership, maintenance, use or entrustment to others of any aircraft that is an "unmanned aircraft". Use includes operation and "loading or unloading".

This Exclusion g.(1) applies even if the claims against any insured allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by that insured, if the "bodily injury” or “property damage” arises out of the ownership, maintenance, use or entrustment to others of any aircraft that is an "unmanned aircraft".
(2) Aircraft (Other Than Unmanned Aircraft), Auto or Watercraft "Bodily injury" or "property damage" arising out of the ownership, maintenance, use or entrustment to others of any aircraft (other than “unmanned aircraft”), "auto" or watercraft owned or operated by or rented or loaned to any insured. Use includes operation and "loading or unloading".

This Exclusion g.(2) applies even if the claims against any insured allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by that insured, if the "bodily injury" or "property damage" arises out of the ownership, maintenance, use or entrustment to others of any aircraft (other than “unmanned aircraft”), "auto" or watercraft that is owned or operated by or rented or loaned to any insured.

This Exclusion g.(2) does not apply to:
(a) A watercraft while ashore on premises you own or rent; (b) A watercraft you do not own that is:
(i) Less than 51 feet long; and
(ii) Not being used to carry persons or property for a charge; (c) Parking an "auto" on, or on the ways next to, premises you own or rent, provided the "auto" is not owned by or rented or loaned to you or the insured;
(d) Liability assumed under any "insured contract" for the ownership, maintenance or use of aircraft (other than “unmanned aircraft”) or watercraft;
(e) "Bodily injury" or "property damage" arising out of:
(i) The operation of any of the machinery or equipment listed in Paragraph f.(2) or f.(3) of the definition of "mobile equipment"; or
(ii) The operation of machinery or equipment that is attached to, or part of, a land vehicle that would qualify under the definition of “mobile equipment” if it were not subject to a compulsory or financial responsibility law or other motor vehicle insurance or motor vehicle registration law where it is licensed or principally garaged; or
(f) An aircraft (other than “unmanned aircraft”) that is not owned by any insured and is hired, chartered or loaned with a paid crew. However, this exception does not apply if the insured has any other insurance for such "bodily injury" or "property damage", whether the other insurance is primary, excess, contingent or on any other basis.
h. Mobile Equipment
"Bodily injury" or "property damage" arising out of:
(1) The transportation of "mobile equipment" by an "auto" owned or operated by or rented or loaned to any insured; or
(2) The use of “mobile equipment” in, or while in practice or preparation for, a prearranged racing, speed or demolition contest or in any stunting activity.

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) i. War
"Bodily injury", "property damage" or "personal and advertising injury", however caused, arising, directly or indirectly, out of:
(1) War, including undeclared or civil war;
(2) Warlike action by a military force, including action in hindering or defending against an actual or expected attack, by any government, sovereign or other authority using military personnel or other agents; or (3) Insurrection, rebellion, revolution, usurped power, or action taken by governmental authority in hindering or defending against any of these.
j. Professional Services
"Bodily injury", "property damage" or "personal and advertising injury" arising out of the rendering of or failure to render any professional service. This includes but is not limited to:
(1) Legal, accounting or advertising services;
(2) Preparing, approving, or failing to prepare or approve maps, shop drawings, opinions, reports, surveys, field orders, change orders, designs or drawings and specifications; (3) Supervisory, inspection, architectural or engineering activities; (4) Medical, surgical, dental, x-ray or nursing services, treatment, advice or instruction; (5) Any health or therapeutic service treatment, advice or instruction; (6) Any service, treatment, advice or instruction for the purpose of appearance or skin enhancement, hair removal or replacement or personal grooming;
(7) Optical or hearing aid services including the prescribing, preparation, fitting, demonstration or distribution of ophthalmic lenses and similar products or hearing aid devices; (8) Optometry or optometric services including but not limited to examination of the eyes and the prescribing, preparation, fitting, demonstration or distribution of ophthalmic lenses and similar products; (9) Any:
(a) Body piercing (not including ear piercing);
(b) Tattooing, including but not limited to the insertion of pigments into or under the skin; and (c) Similar services;
(10)Pharmaceutical services including but not limited to:
(a) The administering, prescribing, preparing, distributing or compounding of pharmaceutical drugs, vaccinations, immunizations or any of their component parts; (b) The providing of or failure to provide home health care or home infusion products or services; and (c) Advising and consulting customers;
(11)Computer consulting, design or programming services, including web site design.

Paragraphs (4) and (5) of this exclusion do not apply to the Incidental Medical Malpractice coverage afforded under Paragraph 1.e. in Section A. Coverages.
k. Damage To Property
"Property damage" to:
(1) Property you own, rent or occupy, including any costs or expenses incurred by you, or any other person, organization or entity, for repair, replacement, enhancement, restoration or maintenance of such property for any reason, including prevention of injury to a person or damage to another's property; (2) Premises you sell, give away or abandon, if the "property damage" arises out of any part of those premises;

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (3) Property loaned to you;
(4) Personal property in the care, custody or control of the insured; (5) That particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the "property damage" arises out of those operations; or
(6) That particular part of any property that must be restored, repaired or replaced because "your work" was incorrectly performed on it.

Paragraphs (1), (3) and (4) of this exclusion do not apply to "property damage" (other than damage by fire) to premises, including the contents of such premises, rented to you for a period of 7 or fewer consecutive days. A separate limit of insurance applies to Damage To Premises Rented To You as described in Section D. Limits Of Insurance.

Paragraph (2) of this exclusion does not apply if the premises are "your work" and were never occupied, rented or held for rental by you.

Paragraphs (3) and (4) of this exclusion do not apply to the use of elevators.

Paragraphs (3), (4), (5) and (6) of this exclusion do not apply to liability assumed under a sidetrack agreement.

Paragraphs (3) and (4) of this exclusion do not apply to "property damage" to borrowed equipment while not being used to perform operations at a job site.

Paragraph (6) of this exclusion does not apply to "property damage" included in the "products-completed operations hazard".
l. Damage To Your Product
"Property damage" to "your product" arising out of it or any part of it. m. Damage To Your Work
"Property damage" to "your work" arising out of it or any part of it and included in the "products-completed operations hazard".

This exclusion does not apply if the damaged work or the work out of which the damage arises was performed on your behalf by a subcontractor.
n. Damage To Impaired Property Or Property Not Physically Injured "Property damage" to "impaired property" or property that has not been physically injured, arising out of:
(1) A defect, deficiency, inadequacy or dangerous condition in "your product" or "your work"; or (2) A delay or failure by you or anyone acting on your behalf to perform a contract or agreement in accordance with its terms.

This exclusion does not apply to the loss of use of other property arising out of sudden and accidental physical injury to "your product" or "your work" after it has been put to its intended use. o. Recall Of Products, Work Or Impaired Property
Damages claimed for any loss, cost or expense incurred by you or others for the loss of use, withdrawal, recall, inspection, repair, replacement, adjustment, removal or disposal of:
(1) "Your product";
(2) "Your work"; or
(3) "Impaired property";
if such product, work or property is withdrawn or recalled from the market or from use by any person or organization because of a known or suspected defect, deficiency, inadequacy or dangerous condition in it. p. Personal And Advertising Injury
"Personal and advertising injury":
(1) Arising out of oral, written, electronic, or any other manner of publication of material, if done by or at the direction of the insured with knowledge of its falsity;

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (2) Arising out of oral, written, electronic, or any other manner of publication of material whose first publication took place before the beginning of the policy period; (3) Arising out of a criminal act committed by or at the direction of the insured; (4) Arising out of any breach of contract, except an implied contract to use another’s "advertising idea" in your "advertisement";
(5) Arising out of the failure of goods, products or services to conform with any statement of quality or performance made in your "advertisement";
(6) Arising out of the wrong description of the price of goods, products or services; (7) Arising out of:
(a) Any actual or alleged infringement or violation of any intellectual property rights, such as copyright, patent, right of publicity, trademark, trade dress, trade name, trade secret, service mark or other designation of origin or authenticity; or
(b) Any injury or damage alleged in any claim or “suit” that also alleges an infringement or violation of any intellectual property right, whether such allegation of infringement or violation is made against you, or by you or by any other party involved in the claim or “suit”, regardless of whether this insurance would otherwise apply.

However, this exclusion does not apply if the only allegation in the claim or “suit” involving any intellectual property right is limited to:
(i) Infringement, in your “advertisement”, of:
a. Copyright;
b. Slogan; unless the slogan is also a trademark, trade dress, trade name, service mark or other designation of origin or authenticity; or
c. Title of any literary or artistic work; or
(ii) Copying, in your “advertisement”, a person’s or organization’s “advertising idea” or style of “advertisement”.

Paragraph (7)(b)ii above shall not apply to claims or “suits” alleging infringement or violation of trademark, trade dress, trade name, service mark or other designation of origin or authenticity. (8) Arising out of an offense committed by an insured whose business is:
(a) Advertising, broadcasting, publishing or telecasting; (b) Designing or determining content of web sites for others; or (c) An Internet search, access, content or service provider.

However, this exclusion does not apply to Paragraphs a., b. and c. under the definition of "personal and advertising injury" in Section F. Liability And Medical Expenses Definitions.

For the purposes of this exclusion, the placing of frames, borders, or links, or advertising, for you or others anywhere on the Internet, is not by itself, considered the business of advertising, broadcasting, publishing or telecasting;
(9) Arising out of an electronic chat room or bulletin board the insured hosts, owns, or over which the insured exercises control;
(10)Arising out of the unauthorized use of another's name or product in your e-mail address, domain name or metatags, or any other similar tactics to mislead another's potential customers; (11)Arising out of the violation of a person's right of privacy created by any state or federal act.

However, this exclusion does not apply to liability for damages that the insured would have in the absence of such state or federal act;
(12)Arising out of:
(a) Advertising content for others on your web site;
(b) Placing a link to a web site of others on your web site;

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Form SL 00 00 10 18 Page 10 of 22 © 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (c) Content from a web site of others displayed within a frame or border on your web site. Content includes information, code, sounds, text, graphics or images; or (d) Computer code, software or programming used to enable:
(i) Your web site; or
(ii) The presentation or functionality of an "advertisement" or other content on your web site; (13)Arising out of a violation of any anti-trust law;
(14)Arising out of the fluctuation in price or value of any stocks, bonds or other securities; (15)Arising out of any access to or disclosure of any person's or organization's confidential or personal information, including patents, trade secrets, processing methods, customer lists, financial information, credit card information, health information or any other type of nonpublic information.

This exclusion applies even if damages are claimed for notification costs, credit monitoring expenses, forensic expenses, public relations expenses or any other loss, cost or expense incurred by you or others arising out of any access to or disclosure of any person's or organization's confidential or personal information; or
(16)Arising out of the ownership, maintenance, use or entrustment to others of any aircraft that is an "unmanned aircraft". Use includes operation and "loading or unloading".

This exclusion applies even if the claims against any insured allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by that insured, if the "personal and advertising injury" arises out of the ownership, maintenance, use or entrustment to others of any aircraft that is an "unmanned aircraft".

However, this exclusion does not apply if the only allegation in the claim or "suit" involves an intellectual property right which is limited to:
(a) Infringement, in your "advertisement", of:
(i) Copyright;
(ii) Slogan; or
(iii) Title of any literary or artistic work; or
(b) Copying, in your "advertisement", a person's or organization's "advertising idea" or style of "advertisement".
q. Access Or Disclosure Of Confidential Or Personal Information And Data-Related Liability (1) Damages because of “bodily injury” or “property damage” arising out of any access to or disclosure of any person’s or organization’s confidential or personal information, including patents, trade secrets, processing methods, customer lists, financial information, credit card information, health information or any other type of nonpublic information; or
(2) Damages arising out of the loss of, loss of use of, damage to, corruption of, inability to access, or inability to manipulate "electronic data".

This exclusion applies even if such damages are claimed for notification costs, credit monitoring expenses, forensic expenses, public relations expenses or any other loss, cost or expense incurred by you or others arising out of that which is described in Paragraphs (1) or (2) above.

However, unless Paragraph (1) above applies, this exclusion does not apply to damages because of “bodily injury”.
r. Employment-Related Practices
"Bodily injury" or "personal and advertising injury" to:
(1) A person arising out of any:
(a) Refusal to employ that person;
(b) Termination of that person's employment; or

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (c) Employment-related practices, policies, acts or omissions, such as coercion, demotion, evaluation, reassignment, discipline, defamation, harassment, humiliation, discrimination, malicious prosecution or false arrest directed at that person; or
(2) The spouse, child, parent, brother or sister of that person as a consequence of "bodily injury" or "personal and advertising injury" to that person at whom any of the employment-related practices described in Paragraphs (a), (b), or (c) above is directed.

This exclusion applies:
(1) Whether the injury-causing event described in Paragraphs (a), (b), or (c) above occurs before employment, during employment or after employment of that person;
(2) Whether the insured may be liable as an employer or in any other capacity; and (3) To any obligation to share damages with or repay someone else who must pay damages because of the injury.
s. Asbestos
(1) "Bodily injury", "property damage" or "personal and advertising injury" arising out of the "asbestos hazard". (2) Any damages, judgments, settlements, loss, costs or expenses that:
(a) May be awarded or incurred by reason of any claim or “suit” alleging actual or threatened injury or damage of any nature or kind to persons or property which would not have occurred in whole or in part but for the "asbestos hazard";
(b) Arise out of any request, demand, order or statutory or regulatory requirement that any insured or others test for, monitor, clean up, remove, encapsulate, contain, treat, detoxify or neutralize or in any way respond to or assess the effects of an "asbestos hazard"; or (c) Arise out of any claim or “suit” for damages because of testing for, monitoring, cleaning up, removing, encapsulating, containing, treating, detoxifying or neutralizing or in any way responding to or assessing the effects of an "asbestos hazard".
t. Recording And Distribution Of Material Or Information In Violation Of Law "Bodily injury", "property damage", or "personal and advertising injury" arising directly or indirectly out of any action or omission that violates or is alleged to violate:
(1) The Telephone Consumer Protection Act (TCPA), including any amendment of or addition to such law; (2) The CAN-SPAM Act of 2003, including any amendment of or addition to such law; (3) The Fair Credit Reporting Act (FCRA), and any amendment of or addition to such law, including the Fair and Accurate Credit Transaction Act (FACTA); or
(4) Any federal, state or local statute, ordinance or regulation, other than the TCPA, CAN-SPAM Act of 2003 or FCRA and their amendments and additions, that addresses, prohibits or limits the printing, dissemination, disposal, collecting, recording, sending, transmitting, communicating or distribution of material or information.

Damage To Premises Rented To You – Exception For Damage By Fire, Lightning Or Explosion Exclusions c. through h. and k. through o. do not apply to damage by fire, lightning or explosion to premises rented to you or temporarily occupied by you with permission of the owner. A separate limit of insurance applies to this coverage as described in Section D. Liability And Medical Expenses Limits Of Insurance.

2. Applicable To Medical Expenses Coverage
We will not pay expenses for "bodily injury":
a. Any Insured
To any insured, except "volunteer workers".
b. Hired Person
To a person hired to do work for or on behalf of any insured or a tenant of any insured.

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) c. Injury On Normally Occupied Premises
To a person injured on that part of premises you own or rent that the person normally occupies. d. Workers' Compensation And Similar Laws
To a person, whether or not an "employee" of any insured, if benefits for the "bodily injury" are payable or must be provided under a workers' compensation or disability benefits law or a similar law. e. Athletics Activities
To a person injured while practicing, instructing or participating in any physical exercises or games, sports or athletic contests.
f. Products-Completed Operations Hazard
Included with the "products-completed operations hazard". g. Business Liability Exclusions
Excluded under Business Liability Coverage.

C. WHO IS AN INSURED

1. If you are designated in the Declarations as:
a. An individual, you and your spouse are insureds, but only with respect to the conduct of a business, other than that described in b. through e. below, of which you are the sole owner. b. A partnership or joint venture, you are an insured. Your members, your partners, and their spouses are also insureds, but only with respect to the conduct of your business. c. A limited liability company, you are an insured. Your members are also insureds, but only with respect to the conduct of your business. Your managers are insureds, but only with respect to their duties as your managers. d. An organization other than a partnership, joint venture or limited liability company, you are an insured. Your "executive officers" and directors are insureds, but only with respect to their duties as your officers or directors.

Your stockholders are also insureds, but only with respect to their liability as stockholders. e. A trust, you are an insured. Your trustees are also insureds, but only with respect to their duties as trustees.

2. Each of the following is also an insured:
a. Employees And Volunteer Workers
Your "volunteer workers" only while performing duties related to the conduct of your business, or your "employees", other than either your "executive officers" (if you are an organization other than a partnership, joint venture or limited liability company) or your managers (if you are a limited liability company), but only for acts within the scope of their employment by you or while performing duties related to the conduct of your business.

However, none of these "employees" or "volunteer workers" are insureds for:
(1) "Bodily injury" or "personal and advertising injury":
(a) To you, to your partners or members (if you are a partnership or joint venture), to your members (if you are a limited liability company), or to a co-"employee" while in the course of his or her employment or performing duties related to the conduct of your business, or to your other "volunteer workers" while performing duties related to the conduct of your business; (b) To the spouse, child, parent, brother or sister of that co-"employee" or that "volunteer worker" as a consequence of Paragraph (1)(a) above;
(c) For which there is any obligation to share damages with or repay someone else who must pay damages because of the injury described in Paragraphs (1)(a) or (b) above; or (d) Arising out of his or her providing or failing to provide professional health care services.

If you are not in the business of providing professional health care services, Paragraph (d) does not apply to any nurse, emergency medical technician or paramedic employed by you to provide such services. (2) "Property damage" to property:

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (a) Owned, occupied or used by:
(b) Rented to, in the care, custody or control of, or over which physical control is being exercised for any purpose by you, any of your "employees", "volunteer workers", any partner or member (if you are a partnership or joint venture), or any member (if you are a limited liability company). b. Real Estate Manager
Any person (other than your "employee" or "volunteer worker"), or any organization while acting as your real estate manager.
c. Temporary Custodians Of Your Property
Any person or organization having proper temporary custody of your property if you die, but only:
(1) With respect to liability arising out of the maintenance or use of that property; and (2) Until your legal representative has been appointed. d. Legal Representative If You Die
Your legal representative if you die, but only with respect to duties as such. That representative will have all your rights and duties under this insurance.
e. Unnamed Subsidiary
Any subsidiary and subsidiary thereof, of yours which is a legally incorporated entity of which you own a financial interest of more than 50% of the voting stock on the effective date of this Coverage Part.

The insurance afforded herein for any subsidiary not shown in the Declarations as a named insured does not apply to injury or damage with respect to which an insured under this insurance is also an insured under another policy or would be an insured under such policy but for its termination or upon the exhaustion of its limits of insurance.

3. Newly Acquired Or Formed Organization
Any organization you newly acquire or form, other than a partnership, joint venture or limited liability company, and over which you maintain financial interest of more than 50% of the voting stock, will qualify as a Named Insured if there is no other similar insurance available to that organization. However:
a. Coverage under this provision is afforded only until the 180th day after you acquire or form the organization or the end of the policy period, whichever is earlier; and b. Coverage under this provision does not apply to:
(1) "Bodily injury" or "property damage" that occurred; or (2) "Personal and advertising injury" arising out of an offense committed before you acquired or formed the organization.

4. Operator Of Mobile Equipment
With respect to "mobile equipment" any person is an insured while driving such equipment along a public highway with your permission. Any other person or organization responsible for the conduct of such person is also an insured, but only with respect to liability arising out of the operation of the equipment, and only if no other insurance of any kind is available to that person or organization for this liability. However, no person or organization is an insured with respect to:
a. "Bodily injury" to a co-"employee" of the person driving the equipment; or b. "Property damage" to property owned by, rented to, in the charge of or occupied by you or the employer of any person who is an insured under this provision.

5. Operator Of Nonowned Watercraft
With respect to watercraft you do not own that is less than 51 feet long and is not being used to carry persons or property for a charge, any person is an insured while operating such watercraft with your permission. Any other person or organization responsible for the conduct of such person is also an insured, but only with respect to liability arising out of the operation of the watercraft, and only if no other insurance of any kind is available to that person or organization for this liability.

However, no person or organization is an insured with respect to:

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) a. "Bodily injury" to a co-"employee" of the person operating the watercraft; or b. "Property damage" to property owned by, rented to, in the charge of or occupied by you or the employer of any person who is an insured under this provision.

No person or organization is an insured with respect to the conduct of any current or past partnership, joint venture or limited liability company that is not shown as a Named Insured in the Declarations.

D. LIABILITY AND MEDICAL EXPENSES LIMITS OF INSURANCE

1. The Most We Will Pay
The Limits of Insurance shown in the Declarations and the rules below fix the most we will pay regardless of the number of:
a. Insureds;
b. Claims made or "suits" brought; or
c. Persons or organizations making claims or bringing "suits".

2. Aggregate Limits
The most we will pay for:
a. Damages because of "bodily injury" and "property damage" included in the "products-completed operations hazard" is the Products-Completed Operations Aggregate Limit shown in the Declarations. b. Damages because of all other "bodily injury", "property damage" or "personal and advertising injury", including medical expenses, is the General Aggregate Limit shown in the Declarations.

This General Aggregate limit does not apply to "property damage" to premises while rented to you or temporarily occupied by you with permission of the owner, arising out of fire, lightning or explosion.

3. Each Occurrence Limit
Subject to 2.a. or 2.b above, whichever applies, the most we will pay for the sum of all damages because of all "bodily injury", "property damage" and medical expenses arising out of any one "occurrence" is the Liability and Medical Expenses Limit shown in the Declarations.

The most we will pay for all medical expenses because of "bodily injury" sustained by any one person is the Medical Expenses Limit shown in the Declarations.

4. Personal And Advertising Injury Limit
Subject to 2.b. above, the most we will pay for the sum of all damages because of all "personal and advertising injury" sustained by any one person or organization is the Personal and Advertising Injury Limit shown in the Declarations.

5. Damage To Premises Rented To You Limit
The Damage To Premises Rented To You Limit is the most we will pay under Business Liability Coverage for damages because of "property damage" to any one premises, while rented to you, or in the case of damage by fire, lightning or explosion, while rented to you or temporarily occupied by you with permission of the owner.

In the case of damage by fire, lightning or explosion, the Damage to Premises Rented To You Limit applies to all damage proximately caused by the same event, whether such damage results from fire, lightning or explosion or any combination of these.

6. How Limits Apply To Additional Insureds
The most we will pay on behalf of a person or organization who is an additional insured under this Coverage Part is the lesser of:
a. The limits of insurance required in a written contract, written agreement or permit; or b. The Limits of Insurance shown in the Declarations.

Such amount shall be a part of and not in addition to the Limits of Insurance shown in the Declarations and described in this Section.

If more than one limit of insurance under this Policy and any endorsements attached thereto applies to any claim or "suit", the most we will pay under this Policy and the endorsements is the single highest limit of liability of all

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) coverages applicable to such claim or "suit". However, this paragraph does not apply to the Medical Expenses limit set forth in Paragraph 3. above.

The Limits of Insurance of this Coverage Part apply separately to each consecutive annual period and to any remaining period of less than 12 months, starting with the beginning of the policy period shown in the Declarations, unless the policy period is extended after issuance for an additional period of less than 12 months. In that case, the additional period will be deemed part of the last preceding period for purposes of determining the Limits of Insurance.

E. LIABILITY AND MEDICAL EXPENSES GENERAL CONDITIONS

1. Bankruptcy
Bankruptcy or insolvency of the insured or of the insured's estate will not relieve us of our obligations under this Coverage Part.

2. Duties In The Event Of Occurrence, Offense, Claim Or Suit a. Notice Of Occurrence Or Offense
You or any additional insured under this Coverage Part must see to it that we are notified as soon as practicable of an "occurrence" or an offense which may result in a claim. To the extent possible, notice should include:
(1) How, when and where the "occurrence" or offense took place; (2) The names and addresses of any injured persons and witnesses; and (3) The nature and location of any injury or damage arising out of the "occurrence" or offense. b. Notice Of Claim
If a claim is made or "suit" is brought against any insured, you or any additional insured under this Coverage Part must:
(1) Immediately record the specifics of the claim or "suit" and the date received; and (2) Notify us as soon as practicable.

You or any additional insured under this Coverage Part must see to it that we receive a written notice of the claim or "suit" as soon as practicable.
c. Assistance And Cooperation Of The Insured
You and any other involved insured must:
(1) Immediately send us copies of any demands, notices, summonses or legal papers received in connection with the claim or “suit”;
(2) Authorize us to obtain records and other information; (3) Cooperate with us in the investigation, settlement of the claim or defense against the "suit"; and (4) Assist us, upon our request, in the enforcement of any right against any person or organization that may be liable to the insured because of injury or damage to which this insurance may also apply. d. Obligations At The Insured's Own Cost
No insured will, except at that insured's own cost, voluntarily make a payment, assume any obligation, or incur any expense, other than for first aid, without our consent. e. Additional Insured's Other Insurance
If we cover a claim or "suit" under this Coverage Part that may also be covered by other insurance available to an additional insured under this Coverage Part, such additional insured must submit such claim or "suit" to the other insurer for defense and indemnity.

However, this provision does not apply to the extent that you have agreed in a written contract, written agreement or permit that this insurance is primary and non-contributory with such additional insured's own insurance.
f. Knowledge Of An Occurrence, Offense, Claim Or Suit
Paragraphs a. and b. apply to you or to any additional insured under this Coverage Part only when such "occurrence", offense, claim or "suit" is known to:

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (1) You or any additional insured under this Coverage Part that is an individual; (2) Any partner, if you or an additional insured under this Coverage Part is a partnership; (3) Any manager, if you or an additional insured under this Coverage Part is a limited liability company; (4) Any "executive officer" or insurance manager, if you or an additional insured under this Coverage Part is a corporation;
(5) Any trustee, if you or an additional insured under this Coverage Part is a trust; or (6) Any elected or appointed official, if you or an additional insured under this Coverage Part is a political subdivision or public entity.

This Paragraph f. applies separately to you and any additional insured under this Coverage Part.

3. Legal action Against Us
No person or organization has a right under this Coverage Part:
a. To join us as a party or otherwise bring us into a "suit" asking for damages from an insured; or b. To sue us on this Coverage Part unless all of its terms have been fully complied with.

A person or organization may sue us to recover on an agreed settlement or on a final judgment against an insured; but we will not be liable for damages that are not payable under the terms of this insurance or that are in excess of the applicable limit of insurance. An agreed settlement means a settlement and release of liability signed by us, the insured and the claimant or the claimant's legal representative.

4. Separation Of Insureds
Except with respect to the Limits of Insurance, and any rights or duties specifically assigned in this Policy to the first Named Insured, this insurance applies:
a. As if each Named Insured were the only Named Insured; and b. Separately to each insured against whom a claim is made or "suit" is brought.

5. Representations
a. When You Accept This Policy
By accepting this Policy, you agree:
(1) The statements in the Declarations are accurate and complete; (2) Those statements are based upon representations you made to us; and (3) We have issued this Policy in reliance upon your representations. b. Unintentional Failure To Disclose Hazards
If unintentionally you should fail to disclose all hazards relating to the conduct of your business at the inception date of this Coverage Part, we shall not deny any coverage under this Coverage Part because of such failure.

6. Other Insurance
If other valid and collectible insurance is available for a loss we cover under this Coverage Part, our obligations are limited as follows:
a. Primary Insurance
This insurance is primary except when b. below applies. If other insurance is also primary, we will share with all that other insurance by the method described in c. below. b. Excess Insurance
This insurance is excess over any of the other insurance, whether primary, excess, contingent or on any other basis:
(1) Your Work
That is Fire, Extended Coverage, Builder's Risk, Installation Risk, Owner Controlled Insurance Program or OCIP, Contractor Controlled Insurance Program or CCIP, Wrap Up Insurance or similar coverage for "your work";

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (2) Premises Rented To You
That is fire, lightning or explosion insurance for premises rented to you or temporarily occupied by you with permission of the owner;
(3) Tenant Liability
That is insurance purchased by you to cover your liability as a tenant for "property damage" to premises rented to you or temporarily occupied by you with permission of the owner; (4) Aircraft, Auto Or Watercraft
If the loss arises out of the maintenance or use of aircraft, "autos" or watercraft to the extent not subject to Exclusion g. of Section B. Exclusions.
(5) Property Damage To Borrowed Equipment Or Use Of Elevators If the loss arises out of "property damage" to borrowed equipment or the use of elevators to the extent not subject to Exclusion k. of Section B. Exclusions.
(6) When You Are Added As An Additional Insured To Other Insurance That is other insurance available to you covering liability for damages arising out of the premises or operations, or products and completed operations, for which you have been added as an additional insured by that insurance; or
(7) When You Add Others As An Additional Insured To This Insurance That is other insurance available to an additional insured.

However, the following provisions apply to other insurance available to any person or organization who is an additional insured under this Coverage Part:
(a) Primary Insurance When Required By Contract
This insurance is primary if you have agreed in a written contract, written agreement or permit that this insurance be primary. If other insurance is also primary, we will share with all that other insurance by the method described in c. below.
(b) Primary And Non-Contributory To Other Insurance When Required By Contract If you have agreed in a written contract, written agreement or permit that this insurance is primary and non-contributory with the additional insured's own insurance, this insurance is primary and we will not seek contribution from that other insurance.

Paragraphs (a) and (b) do not apply to other insurance to which the additional insured has been added as an additional insured.

When this insurance is excess, we will have no duty under this Coverage Part to defend the insured against any "suit" if any other insurer has a duty to defend the insured against that "suit". If no other insurer defends, we will undertake to do so, but we will be entitled to the insured's rights against all those other insurers.

When this insurance is excess over other insurance, we will pay only our share of the amount of the loss, if any, that exceeds the sum of:
(1) The total amount that all such other insurance would pay for the loss in the absence of this insurance; and (2) The total of all deductible and self-insured amounts under all that other insurance.

We will share the remaining loss, if any, with any other insurance that is not described in this Excess Insurance provision and was not bought specifically to apply in excess of the Limits of Insurance shown in the Declarations of this Coverage Part.
c. Method Of Sharing
If all the other insurance permits contribution by equal shares, we will follow this method also. Under this approach, each insurer contributes equal amounts until it has paid its applicable limit of insurance or none of the loss remains, whichever comes first.

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) If any of the other insurance does not permit contribution by equal shares, we will contribute by limits. Under this method, each insurer’s share is based on the ratio of its applicable limit of insurance to the total applicable limits of insurance of all insurers.

7. Transfer Of Rights Of Recovery Against Others To Us
a. Transfer Of Rights Of Recovery
If the insured has rights to recover all or part of any payment, including Supplementary Payments, we have made under this Coverage Part, those rights are transferred to us. The insured must do nothing after loss to impair them. At our request, the insured will bring "suit" or transfer those rights to us and help us enforce them.

This condition does not apply to Medical Expenses Coverage. b. Waiver Of Rights Of Recovery (Waiver Of Subrogation) If the insured has waived any rights of recovery against any person or organization for all or part of any payment, including Supplementary Payments, we have made under this Coverage Part, we also waive that right, provided the insured waived their rights of recovery against such person or organization in a contract, agreement or permit that was executed prior to the injury or damage.

F. LIABILITY AND MEDICAL EXPENSES DEFINITIONS

1. "Advertisement" means a notice that is broadcast or published to the general public or specific market segments about your goods, products or services for the purpose of attracting customers or supporters. For the purpose of this definition:
a. Notices that are published include material placed on the Internet or on similar electronic means of communication; and
b. Regarding web sites, only that part of a web site that is about your goods, products or services for the purpose of attracting customers or supporters is considered an advertisement.

2. "Advertising idea" means any idea for an "advertisement".

3. "Asbestos hazard" means an exposure or threat of exposure to the actual or alleged properties of asbestos and includes the mere presence of asbestos in any form.

4. "Auto" means:
a. A land motor vehicle, trailer or semi-trailer designed for travel on public roads, including any attached machinery or equipment; or
b. Any other land vehicle that is subject to a compulsory or financial responsibility law or other motor vehicle insurance or motor vehicle registration law where it is licensed or principally garaged.

However, "auto" does not include "mobile equipment".

5. "Bodily injury" means physical:
a. Injury;
b. Sickness; or
c. Disease
sustained by a person and, if arising out of the above, mental anguish or death at any time.

6. "Coverage territory" means:
a. The United States of America (including its territories and possessions), Puerto Rico and Canada; b. International waters or airspace, but only if the injury or damage occurs in the course of travel or transportation between any places included in a. above; c. All other parts of the world if the injury or damage arises out of:
(1) Goods or products made or sold by you in the territory described in a. above; (2) The activities of a person whose home is in the territory described in a. above, but is away for a short time on your business; or

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© 2018, The Hartford (May include copyrighted material of Insurance Services Office, Inc., with its permission) (3) "Personal and advertising injury" offenses that take place through the Internet or similar electronic means of communication.
provided the insured's responsibility to pay damages is determined in the United States of America (including its territories and possessions), Puerto Rico or Canada, in a "suit" on the merits according to the substantive law in such territory, or in a settlement we agree to.

7. "Electronic data" means information, facts or computer programs stored as or on, created or used on, or transmitted to or from computer software (including systems and applications software), on hard or floppy disks, CD-ROMs, tapes, drives, cells, data processing devices or any other repositories of computer software which are used with electronically controlled equipment. The term computer programs, referred to in the foregoing description of “electronic data”, means a set of related electronic instructions which direct the operations and functions of a computer or device connected to it, which enable the computer or device to receive, process, store, retrieve or send data.

8. "Employee" includes a "leased worker". "Employee" does not include a "temporary worker".

9. "Executive officer" means a person holding any of the officer positions created by your charter, constitution, bylaws or any other similar governing document.

10. "Hostile fire" means one which becomes uncontrollable or breaks out from where it was intended to be.

11. "Impaired property" means tangible property, other than "your product" or "your work", that cannot be used or is less useful because:
a. It incorporates "your product" or "your work" that is known or thought to be defective, deficient, inadequate or dangerous; or
b. You have failed to fulfill the terms of a contract or agreement; if such property can be restored to use by:
a. The repair, replacement, adjustment or removal of "your product" or "your work"; or b. Your fulfilling the terms of the contract or agreement.

12. "Insured contract" means:
a. A contract for a lease of premises. However, that portion of the contract for a lease of premises that indemnifies any person or organization for damage by fire, lightning or explosion to premises while rented to you or temporarily occupied by you with permission of the owner is subject to the Damage To Premises Rented To You limit described in Section D. Liability And Medical Expenses Limits Of Insurance. b. A sidetrack agreement;
c. Any easement or license agreement, including an easement or license agreement in connection with construction or demolition operations on or within 50 feet of a railroad; d. Any obligation, as required by ordinance, to indemnify a municipality, except in connection with work for a municipality;
e. An elevator maintenance agreement; or
f. That part of any other contract or agreement pertaining to your business (including an indemnification of a municipality in connection with work performed for a municipality) under which you assume the tort liability of another party to pay for "bodily injury" or "property damage" to a third person or organization. Tort liability means a liability that would be imposed by law in the absence of any contract or agreement.

Paragraph f. includes that part of any contract or agreement that indemnifies a railroad for "bodily injury" or "property damage" arising out of construction or demolition operations within 50 feet of any railroad property and affecting any railroad bridge or trestle, tracks, road-beds, tunnel, underpass or crossing.

However, Paragraph f. does not include that part of any contract or agreement:
(1) That indemnifies an architect, engineer or surveyor for injury or damage arising out of:
(a) Preparing, approving or failing to prepare or approve maps, shop drawings, opinions, reports, surveys, field orders, change orders, designs or drawings and specifications; or (b) Giving directions or instructions, or failing to give them, if that is the primary cause of the injury or damage; or

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Los Alamitos City CouncilMarch 24, 2025

Los Alamitos City Council
March 24, 2025