Milpitas City Council
September 17, 2024

September 17, 2024 Milpitas City Council Agenda Page 1

REGULAR MEETING OF THE MILPITAS

CITY COUNCIL
AGENDA
TUESDAY, SEPTEMBER 17, 2024
CITY COUNCIL CHAMBER, 455 E. CALAVERAS BLVD, MILPITAS, CA 6:00 PM (CLOSED SESSION)
7:00 PM (PUBLIC BUSINESS)
For assistance in the following languages, you may call:

Đối với Việt Nam, gọi 408-586-2400
Para sa Tagalog, tumawag sa 408-586-3051
Para español, llame 408-586-3072
* To access written translation during the meeting, scan the QR Code.

The City Council meeting is held in the City Council Chamber at City Hall, 455 E. Calaveras Blvd., Milpitas and via teleconference/Zoom webinar.

You may watch the Council meeting without providing public comment by accessing it via links here.

Meeting shall be livestreamed - Go to:

Facebook: https://www.facebook.com/CityofMilpitas/
YouTube: https://www.milpitas.gov/youtube
Web Streaming: https://www.milpitas.gov/webstreaming

PUBLIC COMMENT INSTRUCTIONS
Oral public comments may only be provided live during the City Council meeting in person, unless the City Council approves remote public comment. All comments provided shall be limited to three minutes or less as determined by the Mayor. All members of the public will be limited to one comment per agenda item, and one comment for non-agenda items. Members of the public may submit written comments by email to [email protected] The meeting will be streamed via Zoom for viewing purposes only unless the City Council approves remote public comment. To watch via Zoom, please register at:
https://ci-milpitas-ca-gov.zoom.us/webinar/register/WN_RHMZ1gDLTI6K_R8id8RTLQ NOTE: If a member of the public wishes to share any presentation materials for Council consideration, they must be submitted to the Clerk’s Office by email to [email protected] by 12:00 p.m. on the day of the meeting. No presentations will be accepted in person in the Council Chambers.

MILPITAS CITY COUNCIL CODE OF CONDUCT
• Be respectful and courteous (words, tone, and body language). • Model civility.
• Avoid surprises.
• Praise publicly and criticize privately.
• Focus on the issue, not the person.
• Refrain from using electronic devices while on the Council dais. • Disclose conflicts of interest and affiliations related to agenda items. • Separate governing from campaigning.
• The Council speaks with one voice after making policy on issues. • Respect the line between policy and administration.
• Council will hold one another accountable to comply with this Code of Conduct.

September 17, 2024 Milpitas City Council Agenda Page 2
CALL MEETING TO ORDER by Mayor and ROLL CALL by City Clerk (6:00 PM)

ADJOURN TO CLOSED SESSION
(a) CONFERENCE WITH LEGAL COUNSEL - Anticipated Litigation Anticipated Litigation Pursuant to Government Code § 54956.9(d)(4) City as Plaintiff
CLOSED SESSION ANNOUNCEMENT:

Report on action taken in Closed Session, if required per Government Code Section 54957.1, including the vote or abstention of each member present.

PLEDGE OF ALLEGIANCE
INVOCATION (Councilmember Phan)

PRESENTATIONS
PUBLIC FORUM (7:05 PM)
Members of the public are invited to speak on any item that does not appear on today’s agenda. Comments will be limited to three minutes or less at the Mayor’s discretion. When called to speak, you are encouraged to state your name for the record.

As an item not listed on the agenda, no action can be taken, however the City Council may instruct the City Manager to place the item on a future meeting agenda.

ANNOUNCEMENT OF CONFLICT OF INTEREST AND CAMPAIGN CONTRIBUTIONS

READING OF THE CITY COUNCIL CODE OF CONDUCT

APPROVAL OF AGENDA
CONSENT CALENDAR (7:15 PM)
Consent calendar items are considered to be routine and will be considered for adoption by one motion. There will be no separate discussion of these items unless a City Councilmember, member of the audience or staff requests the Council to remove an item from (or be added to) the consent calendar. Any person desiring to speak on any item on the consent calendar should ask to have that item removed from the consent calendar.

C1. Receive City Council Calendar of Meetings for September and October 2024 (Staff Contact:

Suzanne Guzzetta, City Clerk, 408-586-3001)
Recommendation: Receive City Council Calendar of Meetings for September and October 2024.

C2. Approve City Council City Council Meeting Minutes of September 3, 2024 (Staff Contact:

Suzanne Guzzetta, City Clerk, 408-586-3001)
Recommendation: Approve City Council Meeting minutes of September 3, 2024.

C3. Receive the Preview List of Anticipated Items for the Next Regular City Council Meeting (Staff Contact: Suzanne Guzzetta, City Clerk, 408-586-3001)
Recommendation: Receive the list of anticipated agenda items for the next regular City Council meeting.

C4. Receive and Review the List of Agenda Items Requested by City Councilmembers (Staff Contact: Suzanne Guzzetta, City Clerk, 408-586-3001)

September 17, 2024 Milpitas City Council Agenda Page 3
Recommendation: Review the list of items that have been requested by City Councilmembers and provide direction to staff as necessary. No substantive discussion about any specific item shall occur and the City Council shall hold all debate about the item until it is scheduled as a full agenda item.

C5. Adopt Ordinance 314, Adding Chapter 15 (“Residential Trespass, Canvassing and Solicitation”) to Title V (“Public Health, Safety and Welfare”) of the Milpitas Municipal Code Relating to Solicitation on Residential Property (Staff Contact: Michael Mutalipassi, City Attorney, 408-586- 3040)
Recommendation: (1) Move to waive second reading and adopt Ordinance 314, which would add Chapter 15 to Title V of the Milpitas Municipal Code to prohibit the trespass of canvassers, solicitors and others on residential property; and, (2) Make findings of exemption from environmental review pursuant to CEQA Guidelines §§15061(b)(3), 15183, 15305, and 15378.

C6. Appointment of Voting Delegates for the Annual California League of Cities Conference (Staff Contact: Matt Cano, Assistant City Manager, 408-586-3012) Recommendation: Appoint Mayor Carmen Montano as the City’s voting delegate and City Manager Ned Thomas as the alternate voting delegate for the 2024 Annual League of California Cities Conference.

C7. Adopt a Resolution Approving the City of Milpitas Investment Policy for Fiscal Year 2024-25 (Staff Contact: Luz Cofresí-Howe, Director of Finance, 408-586-3111) Recommendation: Adopt a Resolution Approving the City of Milpitas Investment Policy for FY 2024-25 C8. Authorize the City Manager to Execute an Agreement with Staples Contract & Commercial LLC for Office Supplies (Staff Contact: Luz Cofresí-Howe, Finance Director, 408-586-3111) Recommendation: Authorize the City Manager to execute an agreement with Staples Contract & Commercial LLC for Office Supplies through a Sourcewell Cooperative Procurement Agreement for a five-year period in a not-to-exceed amount of $725,000.

C9. Adopt a Resolution Granting Acceptance of the Alviso Adobe House HVAC System, Project No. 5055, Authorizing the City Engineer to File a Notice of Completion, and Authorizing the City Engineer to Issue a Notice of Final Acceptance After the One-Year Warranty Period (Staff Contact: Christian Di Renzo, Public Works Director, 408-586-2602; and Michael Silveira, City Engineer, 408-586-3303)
Recommendation: Adopt a resolution granting acceptance of the Alviso Adobe House HVAC System, Project No. 5055 authorizing the City Engineer to file a Notice of Completion and authorizing the City Engineer to issue a Notice of Final Acceptance after the one-year warranty period.

C10. Receive an Update on the Security Improvements at the McCarthy Ranch Sewer Lift Station (Main Lift) and Determine that the Condition Continues to Constitute an Emergency (Staff Contact: Christian Di Renzo, Public Works Director, 408-586-2602) Recommendation: (1) Receive an update on the security improvements at the McCarthy Ranch Sewer Lift Station; and (2) Determine by a four-fifths vote that the condition continues to constitute an emergency.

PUBLIC HEARINGS (7:20 PM)
Members of the public may be allotted up to three (3) minutes or less at the Mayor’s discretion, to comment on any public hearing item. Applicants/Appellants and their representatives may be allotted up to a total of ten (10) minutes for opening statements and up to a total of five (5) minutes maximum for closing statements. Items requested/recommended for continuance are subject to Council’s consent at the meeting.

September 17, 2024 Milpitas City Council Agenda Page 4

11. Conduct a Public Hearing and Approve the Draft FY 2023-2024 Community Development Block Grant (CDBG) Consolidated Annual Performance and Evaluation Report (CAPER) (Staff Contact:

Robert Musallam, Housing Official, 408-586-3275)
Recommendation: (1) Conduct a public hearing; (2) Approve the draft FY 2023-2024 Community Development Block Grant (CDBG) Consolidated Annual Performance and Evaluation Report (CAPER); and (3) Authorize the City Manager, or designee, to make any necessary changes and submit the approved draft FY 2023-2024 CAPER to the U.S. Department of Housing and Urban Development (HUD) to comply with CDBG requirements.

LEADERSHIP AND SUPPORT SERVICES (8:30 PM)

12. Review the List of Agenda Item Requests From Individual Councilmembers and Provide Direction to Staff Through the Council-Approved Prioritization Process (Staff Contact: Matt Cano, Assistant City Manager, 408-586-3012)
Recommendation: (1) Review list of agenda item requests from individual Councilmembers and provide direction to staff, through the prioritization process, on which Group 1 items should be advanced; and (2) Provide additional input to staff, if any, on Group 1 items that received Council direction to advance.

ANNOUNCEMENTS AND FUTURE AGENDA ITEMS (9:00 PM)
Members of the City Council or City Manager may make brief announcements at this time. Members of the City Council may also suggest future agenda items. For future agenda items, the City Council shall not debate the topic or engage in discussion but shall simply state a “yes” or “no” as whether to move the item forward. If a majority of the City Council agrees to move the item forward, the City Manager shall place the item on a future agenda.

ADJOURNMENT (9:05 PM)

KNOW YOUR RIGHTS UNDER THE OPEN GOVERNMENT ORDINANCE
Government’s duty is to serve the public, reaching its decisions in full view of the public. Commissions and other City agencies exist to conduct the people’s business. This ordinance assures that deliberations are conducted before the people and City operations are open to the people’s review. For more information on your rights under the Open Government Ordinance or to report a violation, contact the City Attorney’s office at Milpitas City Hall, 455 E. Calaveras Blvd., Milpitas, CA 95035 e-mail:[email protected] / Phone: 408-586-3040 The Open Government Ordinance is codified in the Milpitas Municipal Code as Title I Chapter 310 and is available online at the City’s website www.milpitas.gov by selecting the Milpitas Municipal Code link.

Materials related to an item on this agenda submitted to the City Council after initial distribution of the agenda packet are available for public inspection at the City Clerk’s office at Milpitas City Hall, 3rd floor 455 E. Calaveras Blvd., Milpitas and on City website. City Council agendas and related materials can be viewed online: www.milpitas.gov/government/council/agenda_minutes.asp (select meeting date)

APPLY TO SERVE ON A CITY COMMISSION
Commission application forms are available online at www.milpitas.gov or at Milpitas City Hall.

Contact the City Clerk’s Office at 408-586-3001 for more information.

If you need assistance, per the Americans with Disabilities Act, for any City of Milpitas public meeting, please call the City Clerk at 408-586-3001 or send an e-mail to [email protected] prior to the meeting. You may request a larger font agenda.

MILPITAS CITY COUNCIL CALENDAR
September 2024
Sunday Monday Tuesday Wednesday Thursday Friday Saturday 1 2

CITY HOLIDAY
City Hall Closed
3 6:00 PM-Closed Session
7:00 PM-City Council
4 1:00 PM-Santa Clara VTA Monthly
Briefing - Northeast Group (CM)
5 5:00 PM-Milpitas Chamber of
Commerce Board (GB)
5:30 PM-Santa Clara VTA Board of
Directors (CM)
6 7
8 9
4:30 PM-Economic Development and
Trade Commission (CM)
7:00 PM-Parks, Recreation and
Cultural Resources Commission (HL)
10 4:00 PM- Milpitas HOPE
11 7:00 PM-Silicon Valley Clean Energy
Board of Directors (EC) (Milpitas)
12 4:00 PM-Silicon Valley Regional
Interoperability Authority Board of
Directors (GB) (Santa Clara)
4:00 PM-Santa Clara VTA Policy
Advisory Committee (EC)
4:00 PM-Treatment Plant Advisory
Committee (CM) (San Jose)
6:00 PM-Youth Advisory Commission
(HL)
6:30 PM-Special Meeting CASCC
(CM) (Los Altos)
7:00 PM-CASCC Board of Directors
(CM) (Los Altos)
13 14
15 16
7:00 PM-Science, Technology, and
Innovation Commission (GB)
7:00 PM-Library and Education
Commission (EC) (Milpitas Public
Library)
17 6:00 PM-Closed Session
7:00 PM-City Council
18 6:00 PM-Energy and Environmental
Sustainability Commission (EC)
19 10:00 AM-VTA Congestion
Management Program & Planning
Committee (CM) (San Jose)
5:30 PM-Measure F Oversight
Committee
6:30 PM-Bay Area Water Supply
Conserv Agency (CM) (Sequoia Room
– Burlingame Community Center)
7:00 PM-Public Safety and
Emergency Preparedness Commission
(HL)
20 9:00 AM-Santa Clara VTA Board of
Directors Workshop (CM)
6:00 PM-Lantern Festival (Civic
Center Plaza)
21 22 23
7:00 PM-Arts Commission (EC)
24 5:30 PM-Special Council Meeting
25 7:00 PM-Planning Commission
26 4:00 PM-Silicon Valley Regional
Interoperability Authority Board of
Directors (GB)
6:00 PM-Zoning Advisory Group
27 28
29 30
August 2024

S M T W T F S
1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31
October 2024

S M T W T F S
1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
20 21 22 23 24 25 26
27 28 29 30 31

MILPITAS CITY COUNCIL CALENDAR
October 2024
Sunday Monday Tuesday Wednesday Thursday Friday Saturday 1 6:00 PM-Closed Session
7:00 PM-City Council
2 1:00 PM-Santa Clara VTA Monthly
Briefing - Northeast Group (CM)
(Virtual)
5:30 PM-Veterans Commission (CM)
7:00 PM- Community Housing
Commission (EC)
3 5:30 PM-Santa Clara VTA Board of
Directors (CM)
4 9:00 AM to 2:30 PM-8th Annual
Manufacturing Day Event (McCarthy
Blvd. area)
5 6 7
7:00 PM-Parks, Recreation & Cultural
Resources Commission (HL)
8 9
7:00 PM-Silicon Valley Clean Energy
Board of Directors (EC) (Cupertino)
7:00 PM-Planning Commission
10 4:00 PM-Treatment Plant Advisory
Committee (CM) (San Jose)
4:00 PM-Santa Clara VTA Policy
Advisory Committee (EC)
5:30 PM-CASCC Legislative Action
Committee (Los Altos) (CM)
6:00 PM-Youth Advisory Commission
(HL)
7:00 PM-Cities Assoc of SCC Board of
Directors (CM) (Los Altos)
11 9:00 AM-Valley Water Summit (CM)
(Santa Clara)
4:00 PM-City/School Collaborative
Subcommittee (CM/EC) (City Hall)
12 13 14
4:30 PM-Economic Development and
Trade Commission (CM)
15 6:00 PM-Closed Session
7:00 PM-City Council
16 6:00 PM-Energy and Environmental
Sustainability Commission (EC)
17 18 19
20 21 22
1:30 PM-Senior Advisory Commission
(CM)
5:30 PM-Place Holder for a Special
City Council Meeting (Approved on
Nov 2023 Council meeting)
23 12:00 PM-Water Commission
Meeting (CM) (San Jose)
5:30 PM-Cities Assoc. of SCC -
Recycling and Waste Reduction
Commission (CM)
7:00 PM-Planning Commission
24 12:00 PM-SCC Library JPA Board
Meeting (CM) (Campbell)
25 26
27 28 29 30 31
September 2024

S M T W T F S
1 2 3 4 5 6 7
8 9 10 11 12 13 14
15 16 17 18 19 20 21
22 23 24 25 26 27 28
29 30
November 2024

S M T W T F S
1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
17 18 19 20 21 22 23
24 25 26 27 29 29 30

September 3, 2024 Milpitas City Council Minutes Page 1

REGULAR MEETING OF THE MILPITAS

CITY COUNCIL

MINUTES
TUESDAY, SEPTEMBER 3, 2024
The City Council of the City of Milpitas convened on the regular City Council meeting day in a Regular Meeting of the Milpitas City Council on September 3, 2024, in the City Council Chamber, 455 E. Calaveras Blvd, Milpitas, CA, and via teleconference/Zoom webinar.

CALL MEETING TO ORDER by Mayor and ROLL CALL by City Clerk Mayor Montano called the Regular City Council meeting to order at 6:00 PM. Roll Call was taken by City Clerk Guzzetta.

PRESENT: Mayor Montano, Vice Mayor Chua, Councilmember Barbadillo (6:05 PM), Councilmember Lien, Councilmember Phan (6:02 PM)
ABSENT: None.

City Attorney Mutalipassi briefed the City Council on the items to be heard at Closed Session.

There were no public speakers.

The City Council adjourned to closed session at 6:02 pm.

ADJOURN TO CLOSED SESSION
(a) CONFERENCE WITH LEGAL COUNSEL - Existing Litigation Existing Litigation Pursuant to Government Code § 54956.9(d)(2) In the Matter of City of Milpitas vs Toll Bros., Inc., Superior Court of California, County of Santa Clara, Case No.22CV406447
City as Defendant
CLOSED SESSION ANNOUNCEMENT:

The City Council reconvened at 7:00 pm.

City Attorney Mutalipassi reported that the Closed Session matter was settled for $40,000.

PLEDGE OF ALLEGIANCE
Councilmember Barbadillo led the pledge of allegiance.

INVOCATION
Councilmember Phan provided the invocation.

PRESENTATIONS
Mayor Montano, joined by the City Council, presented proclamations in recognition of National Suicide Prevention Week, National Preparedness Month, American Muslim Appreciation and Awareness Month and National IT Professionals Day. Additionally, certificates were presented recognizing the Milpitas IT team.

September 3, 2024 Milpitas City Council Minutes Page 2

PUBLIC FORUM
There were the following public speakers.

1. Virgil King

ANNOUNCEMENT OF CONFLICT OF INTEREST AND CAMPAIGN CONTRIBUTIONS City Attorney Mutalipassi asked the Mayor and City Councilmembers if they had any personal conflicts of interest. By roll call, there were no conflicts of interest. City Attorney Mutalipassi asked the Mayor and City Councilmembers if they had any reportable campaign contributions. By roll call, there were no reportable campaign contributions.

READING OF THE CITY COUNCIL CODE OF CONDUCT
Vice Mayor Chua read the City Council Code of Conduct.

APPROVAL OF AGENDA
Mayor Montano made a motion: to move Item 12 to the Consent Calendar.

Motion/Second: Mayor Montano / Councilmember Lien
by the following:

AYES: Mayor Montano, Vice Mayor Chua, Councilmember Barbadillo, Councilmember Lien, Councilmember Phan
NOES: None
Motion: to approve the agenda,
Motion/Second: Vice Mayor Chua / Mayor Montano
Motion carried by the following:

AYES: Mayor Montano, Vice Mayor Chua, Councilmember Barbadillo, Councilmember Lien, Councilmember Phan
NOES: None

CONSENT CALENDAR
Councilmember Lien asked to pull Item C10 from the Consent Calendar.

There were no public speakers.

After discussion, motion: to pull Item C10 and approve the consent calendar.

Motion/Second: Councilmember Lien / Vice Mayor Chua
Motion carried by the following:

AYES: Mayor Montano, Vice Mayor Chua, Councilmember Barbadillo, Councilmember Lien NOES: Councilmember Phan

1. Receive City Council Calendar of Meetings for September 2024 (Staff Contact: Suzanne Guzzetta, City Clerk, 408-586-3001)
Received City Council Calendar of Meetings for September 2024.

2. Approve City Council Meeting Minutes of August 13 and 20, 2024 (Staff Contact: Suzanne

September 3, 2024 Milpitas City Council Minutes Page 3
Guzzetta, City Clerk, 408-586-3001)
Approved City Council Meeting minutes of August 13 and 20, 2024.

3. Receive the Preview List of Anticipated Items for the Next Regular City Council Meeting (Staff Contact: Suzanne Guzzetta, City Clerk, 408-586-3001)
Received the list of anticipated agenda items for the next regular City Council meeting.

4. Receive and Review the List of Agenda Items Requested by City Councilmembers (Staff Contact: Suzanne Guzzetta, City Clerk, 408-586-3001)
Reviewed the list of items that have been requested by City Councilmembers and provided direction to staff as necessary.

5. Consider Recommendations from Mayor Montano for Removal from and Appointments to City Commissions (Contact: Mayor Montano, 408-586-3024)
Received Mayor Montano's recommendations, approved removal from the Public Safety and Emergency Preparedness Commission, and approved and confirmed recommendations for appointments to City Commissions as follows:

Economic Development and Trade Commission:

1. Reappoint Lynne Rice to a full-term ending April 2027

2. Reappoint Parkash Daryani to a full-term ending April 2027

3. Reappoint Vasista Ramachandruni as a non-voting student member with a full-term ending April 2027

4. Reappoint Conrad Schapira as Alternate No. 1 with a full-term ending April 2027 Library and Education Advisory Commission:

1. Reappoint Yu-Lan Chou to a full-term ending June 2027

2. Reappoint Rekha Pardeshi to a full-term ending June 2027 Parks, Recreation and Cultural Resources Commission:

1. Reappoint Ricky Davis to a full-term ending June 2027

2. Reappoint Joseph Ehardt to a full-term ending June 2027

3. Reappoint Allen Thomas to a full-term ending June 2027

4. Appoint Catalina Silva to a full-term ending June 2027 Public Safety and Emergency Preparedness Commission:

1. Remove Joe Nichols from a full voting seat with an unexpired term ending June 2026

2. Reappoint Evan Gan to a full-term ending June 2027

3. Appoint Norma Morales to a full-term ending June 2027

4. Appoint Diyan Shah as a non-voting student member with an unexpired term ending June 2026 Youth Advisory Commission:

1. Appoint Samyukta Rangarajan to an unexpired term ending September 2025 Measure F Oversight Committee:

1. Reappoint Joyita Ghose to a full-term ending March 2027

2. Reappoint Conrad Schapira to a full-term ending March 2027

3. Reappoint Madan Menon to a full-term ending March 2027

4. Appoint Anas Rehman to a full-term ending March 2027

September 3, 2024 Milpitas City Council Minutes Page 4

6. Approve Amendments to the Subscription and Services Agreement with RideCo for Milpitas SMART (Staff Contact: Jay Lee, Planning Director, 408-586-3077) (1) Approved amendments to the subscription and services agreement with RideCo for Milpitas SMART, with a subscription and services fee increase per vehicle revenue hour but no change to the not-to-exceed contract amount of $2,955,916; and (2) Authorized the City Manager to execute the amended agreements.

7. Approve Personnel Realignment to Support Department Operations (Staff Contact: Christian Di Renzo, Public Works Director, 408-586-2602)
Approved the deletion of a vacant Fleet Maintenance Worker III and a vacant Maintenance Assistant position and the addition of two Maintenance Worker I/II positions in the Department of Public Works.

8. Authorize the City Manager to Execute a Memorandum of Understanding between the City of Milpitas and Crown Castle Fiber LLC, a New York Limited Liability Company, to Install Telecommunication Equipment within the City Right-of-Way (Staff Contact: Christian Di Renzo, Public Works Director, 408-586-2602; and Michael Silveira, City Engineer, 408-586-3303) Authorized the City Manager to execute a Memorandum of Understanding between the City of Milpitas and Crown Castle Fiber LLC, a New York Limited Liability Company, to conduct a pilot project using the Rapid Connect proprietary method to install telecommunication equipment within the City Right-of-Way.

9. Receive an Update on the Security Improvements at the McCarthy Ranch Sewer Lift Station(Main Lift) and Determine that the Condition Continues to Constitute an Emergency (Staff Contact:

Christian Di Renzo, Public Works Director, 408-586-2602) (1) Received an update on the security improvements at the McCarthy Ranch Sewer Lift Station; and (2) Determined by a four-fifths vote that the condition continues to constitute an emergency. *12. Adopt a Resolution Adopting all of Volume 1 and the City of Milpitas Portion of Volume 2, of the Santa Clara County Multi-Jurisdictional Hazard Mitigation Plan (Staff Contact: Jason Schoonover, Fire Chief, 408-586-2811; and Toni Charlop, Emergency Management Coordinator 408-586-2801)
Adopted Resolution No. 9352 adopting all of Volume 1 and the City of Milpitas Portion of Volume 2, of the Santa Clara County Operational Area Hazard Mitigation Plan.

LEADERSHIP AND SUPPORT SERVICES

11. Provide Feedback on and Potentially Introduce Ordinance 302, Adding Chapter 15 (“Residential Trespass, Canvassing and Solicitation”) to Title V (“Public Health, Safety and Welfare”) of the Milpitas Municipal Code Relating to Solicitation on Residential Property (Staff Contact: Michael Mutalipassi, City Attorney, 408-586-3040)
City Manager Thomas introduced the item. City Attorney Mutalipassi provided additional background and Assistant City Attorney Creech presented the report.

Councilmember Lien raised several concerns about the ordinance and questioned the necessity of the new regulations. She expressed worry that the ordinance could impact political canvassing and other forms of community engagement and highlighted the importance of public education. She suggested that the ordinance should include a delayed effective date of January 1, 2025, to allow sufficient time for community outreach and education.

Vice Mayor Chua echoed Councilmember Lien’s concerns, emphasizing the need for a comprehensive

September 3, 2024 Milpitas City Council Minutes Page 5
outreach strategy. She also mentioned potential challenges in enforcement and the importance of ensuring that the ordinance does not place an undue burden on city resources..

Councilmember Barbadillo, who initially proposed the ordinance, highlighted the importance of protecting homeowners' rights and providing them with peace of mind.

Councilmember Phan supported the ordinance, noting that it offered residents additional tools to control access to their homes while acknowledging the concerns about political canvassing.

After discussion, the council agreed on a delayed implementation.

Vice Mayor Chua made a motion: to waive the reading beyond the title and introduce Ordinance 302, which would add Chapter 15 to Title V of the Milpitas Municipal Code to prohibit the trespass of canvassers, solicitors and others on residential property with an effective date of January 1, 2025; and make findings of exemption from environmental review pursuant to CEQA Guidelines Sections 15061(b)(3), 15183, 15305, and 15378. Mayor Montano seconded the motion.

Motion/Second: Vice Mayor Chua / Mayor Montano
Motion carried by the following:

AYES: Mayor Montano, Vice Mayor Chua, Councilmember Barbadillo, Councilmember Phan NOES: Councilmember Lien

PUBLIC SAFETY
*12. Adopt a Resolution Adopting all of Volume 1 and the City of Milpitas Portion of Volume 2, of the Santa Clara County Multi-Jurisdictional Hazard Mitigation Plan (Staff Contact: Jason Schoonover, Fire Chief, 408-586-2811; and Toni Charlop, Emergency Management Coordinator 408-586-2801)
Item added to Consent Calendar

ITEMS PULLED FROM CONSENT CALENDAR

10. Approve the Addition of Jose Esteves to the Milpitas Historical Names Naming List and Adopt a Resolution to Rename the Milpitas Library (Staff Contact: Renee Lorentzen, Recreation and Community Services Director, 408-586-3409)
Councilmember Lien raised concerns about the timing of the proposal to rename the Milpitas Library to the Milpitas Jose Esteves Library, suggesting that the process should be postponed until after the upcoming election. She emphasized the importance of community outreach to ensure residents are involved in the decision.

Councilmember Phan supported moving forward with the renaming, noting that the request was made well in advance and had already gone through the appropriate processes, including input from the ad hoc subcommittee on naming.

Councilmember Barbadillo expressed support for the renaming, emphasizing that it was a deserving recognition based on the established naming criteria. He suggested that staff look for funding sources for new signage and recommended implementing the name change before the election.

Assistant City Manager Cano clarified that if the renaming was approved, it would take effect immediately in practice, but new signage would depend on securing funding.

September 3, 2024 Milpitas City Council Minutes Page 6
After discussion, motion: to (1) Approve adding Jose Esteves to the Milpitas Historical Names Naming List; and (2) Adopt a resolution to rename the Milpitas Library to “Milpitas Jose Esteves Library”.

Motion/Second: Councilmember Barbadillo / Councilmember Phan Motion carried by the following:

AYES: Mayor Montano, Vice Mayor Chua, Councilmember Barbadillo, Councilmember Phan NOES: Councilmember Lien

ANNOUNCEMENTS AND FUTURE AGENDA ITEMS
City Manager Thomas informed the council that community recreation facilities would be open as cooling centers on September 4 and 5, due to warm weather, from 7:00 AM to 9:00 PM.

Vice Mayor Chua proposed updating the animal control ordinance to include other animals such as horses and cats. There was unanimous consensus to add the item to the prioritization list.

Mayor Montano made the following requests:

1. Explore the creation of a compassion fund to support community members dealing with cancer or other significant life events. There was unanimous consensus to add the item to the prioritization list.

2. Consider reducing the maximum rental assistance grant from $5,000 to $3,500 to assist more residents. There was consensus to add the item to the prioritization list (4-1. No: Phan).

3. Increase the days of operation for the local food pantry from two to five days a week to better serve community needs. The council agreed to have staff investigate this issue, as discussions with the food pantry are already in progress.

4. Reestablish or highlight the existing graffiti hotline due to an increase in graffiti. It was noted that graffiti can already be reported through the My Milpitas app, so no formal consensus was required.

Councilmember Barbadillo requested that staff explore funding options for new signage following the decision to rename the Milpitas Library to the Milpitas Jose Esteves Library. There was unanimous consensus to add the item to the prioritization list.

ADJOURNMENT
Mayor Montano adjourned the meeting at 8:30 PM.

Draft meeting minutes submitted by City Clerk, Suzanne Guzzetta

TENTATIVE CITY COUNCIL AGENDA ITEM LIST
as of 9/12/2024
October 1, 2024 – Regular Meeting

CLOSED SESSION
•City Manager Annual Performance Review
INVOCATION (Mayor Montano)

PRESENTATION
•Fire Prevention Week – October 6-12 (Proclamation)
•Indigenous Peoples’ Day – October 14 (Proclamation)
•Hindu American Awareness and Appreciation Month (Proclamation) •California Clean Air Day (Proclamation)

CONSENT CALENDAR

1. Receive City Council calendar for October 2024 (City Clerk)

2. Approve City Council meeting minutes of September 17, 2024 (City Clerk)

3. Preview list of items for October 15, 2024 (City Clerk)

4. Councilmember Request List (City Clerk)

5. Mayor and City Manager Travel to the League of California Cities Annual Conference in Long Beach from October 16-18, 2024 (City Manager)

6. Legislative Report (City Manager)

7. 1327 Terra Vista Hillside Home (Lot 3) (Planning)

8. Emergency Declaration Update - Main Sewer Lift Station Security Measures (Public Works)

9. Citywide Tree Maintenance Multi-Year Contract Award (Public Works)

10. 1355 California Circle Sewer Liner Reimbursement Agreement (Public Works / Engineering)

COMMUNITY SERVICES

11. Survey Results for Street Sweeping Pilot (Public Works)

PUBLIC SAFETY

12. PD Staffing Update / Lateral Incentives (Police / Human Resources)

MILPITAS CITY COUNCIL

AGENDA ITEM REQUESTS

OPEN ITEMS
Request
No. Topic Submitted by:

Date
Requested
STATUS and/or DATE scheduled on City
Council meeting agenda:
1 Explore funding options for new signage following
the decision to rename the Milpitas Library to the
Milpitas Jose Esteves Library Barbadillo 9/3/2024 No status update at this time. 2 Consider reducing the maximum rental assistance
grant from $5,000 to $3,500 to assist more
residents Montano 9/3/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
3 Explore the creation of a compassion fund to
support community members dealing with cancer
or other significant life events Montano 9/3/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
4 Update the animal control ordinance to include
other animals such as horses and cats Chua 9/3/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
5 Bring back the Solicitation Ordinance as previously
presented to City Council with Council comments
from when it was last considered. Barbadillo 8/20/2024
This item appears on the 9/17 City Council
agenda
6 Look into a property for sale on Main Street to
investigate the cost and feasibility of creating a
museum for downtown or Old Town Main Street as
part of the revitalization efforts. Montano 8/13/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
7 Send a letter to Supervisory Otto Lee regarding the
weeds on Montague Expressway Montano 8/13/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
8 Look into adopting an ordinance similar to San
Jose allowing ADUs (Accessory Dwelling Units) to
have a separate title and be sold separately. Chua 8/13/2024 An update on this item is included in the
9/17/2024 City Council prioritization item.
9 Bring back information on the process and steps
required for renaming the Milpitas library after
former Mayor Jose S. Esteves, including
consultation with the library JPA and the naming
subcommittee, for discussion at the August 20th
council meeting. Barbadillo 8/5/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
10 Prepare commendations or keys to the city for
local Olympians representing Milpitas at the
Olympics, to be presented after the conclusion of
the Olympic games. Montano 8/5/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
11 Return with a ceremonial resolution on childcare Phan 8/5/2024 This item was approved at the 8/20/2024 city
coucnil meeting.
12 Send a letter signed by the Mayor and City Council
to the County Administrator and Supervisor Lee,
asking the county to investigate the treatment of
horses by Chaparral Corporation at Ed Levine Park
and the adjacent Chaparral Ranch Chua 5/21/2024
This letter was sent to the County on June 7,
2024.

ACTIVE ITEMS
Request
No. Topic Submitted by:

Date
Requested
STATUS and/or DATE scheduled on City
Council meeting agenda:
13 Conduct a traffic study on Escuela Parkway to
address circulation concerns Montano 5/7/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
14 Explore the possibility of augmenting the Planning
Commission stipend Barbadillo 4/16/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
15 Explore changing or enhancing the focus of the
community advisory commission to add housing Chua 4/2/2024 This was completed at the 8/13/2024 City
Council meeting.
16 Request that the Arts Commission explore
alternatives for future of statue in front of City Hall Phan 1/30/2024 This item was not prioritized at the
6/11/2024 city council meeting so is deemed
complete.

NOTE: Deferred and Completed Items are not listed

MILPITAS CITY COUNCIL

AGENDA ITEM REQUESTS
17 Update the Commissioner Handbook to include an
option for outgoing commissioners to make
presentations to other commissions Chua 1/23/2024
This item was not prioritized at the
6/11/2024 city council meeting so is deemed
complete.
18 Workshop for retailers focusing on best practices
and safety with plans for quarterly sessions Chua 1/23/2024 This was listed as completed a thte
6/11/2024 city council meeting.
19 Explore possibility of naming the County library on
Main Street Phan 1/23/2024
An update on this item is included in the
9/17/2024 City Council prioritization item.
20 Consideration of the 20% Low Income Below
Market Rate Housing Montano 12/5/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
21 Bring back Bingo and the Tour at the Senior
Center Chua 11/7/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
22 Referral for utility infrastructure cost on Main Street from Carlo to Corning Streets Montano 10/17/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
23 Consider a possible ordinance or policy regarding
solicitations at home Barbadillo 10/3/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
24 Main Street International Festival Lien 10/3/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
25 Have the Police Chief direct staff to complete an
analysis in partnership with the County to
determine if it would be beneficial to have a
location where residents can pickup Narcan Chua 9/5/2023 An update on this item is included in the
9/17/2024 City Council prioritization item.
26 Explore taking steps towards becoming a Charter
City Phan 9/5/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
27 Human Resources Director to conduct a job fair
specific to the job openings at City Hall Chua 5/2/2023 An update on this item is included in the
9/17/2024 City Council prioritization item.
28 Pickleball Pilot Project Chua 2/28/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
29 Main Street Infrastructure Projects Montano 2/28/2023 An update on this item is included in the
9/17/2024 City Council prioritization item.
30 Main Street Flooding at Library Chua 2/28/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
31 Satellite Consulate Office Montano 2/28/2023
This was listed as completed a thte
6/11/2024 city council meeting.
32 Have the City look into the possibility of a Citywide Senior Discount Barbadillo 2/7/2023
An update on this item is included in the
9/17/2024 City Council prioritization item.
33 City Manager to look into defining either a
standalone teen center or updating information to
indicate the Senior Center also functions as a Teen
Center Chua 9/20/2022
An update on this item is included in the
9/17/2024 City Council prioritization item.
34 Discuss converting vacant lot that was a basketball
court into a community garden at Vasona and
Adobe Montano 8/16/2022
This was listed as completed a thte
6/11/2024 city council meeting.
35 City Manager look into implementing a workshop
for small businesses on the bidding process for
projects in the city Chua 8/9/2022
An update on this item is included in the
9/17/2024 City Council prioritization item.
36 Quarterly or Monthly crime statistics on Homekey
Project Chua 6/7/2022
An update on this item is included in the
9/17/2024 City Council prioritization item.
37 Memorial Plaque in honor of youth skateboarder
that passed away Montano 6/7/2022
An update on this item is included in the
9/17/2024 City Council prioritization item.
38 Evaluate reopening the childcare center with a non-
profit organization running the center Montano 2/1/2022 An update on this item is included in the
9/17/2024 City Council prioritization item.
39 Staff to look into mural Art on Great Mall Parkway
on the VTA owned Light rail pillars Montano 11/16/2021
An update on this item is included in the
9/17/2024 City Council prioritization item.
40 Have a picture of Albert Vogel Sr. put up in the
Senior Center Montano 10/19/2021
An update on this item is included in the
9/17/2024 City Council prioritization item.

ACTIVE ITEMS
Request
No. Topic Submitted by:

Date
Requested
STATUS and/or DATE scheduled on City
Council meeting agenda:

NOTE: Deferred and Completed Items are not listed

MILPITAS CITY COUNCIL

AGENDA ITEM REQUESTS
41 Include a bust of Maria Lemire on the Mural in front of the Senior Center Montano 8/17/2021
An update on this item is included in the
9/17/2024 City Council prioritization item.
42 Consider Community Museum and Park on Main
St. Phan 8/20/2019
Discussions with the property owner of this
site are ongoing.

ACTIVE ITEMS
Request
No. Topic Submitted by:

Date
Requested
STATUS and/or DATE scheduled on City
Council meeting agenda:

NOTE: Deferred and Completed Items are not listed

CITY OF MILPITAS

AGENDA REPORT
(AR)
Item Title: Adopt Ordinance 314, Adding Chapter 15 (“Residential Trespass, Canvassing and Solicitation”) to Title V (“Public Health, Safety and Welfare”) of the Milpitas Municipal Code Relating to Solicitation on Residential Property (Staff Contact:

Michael Mutalipassi, City Attorney, 408-586-3040)
Category: Consent Calendar-Leadership and Support Services Meeting Date: 9/17/2024
Recommendation: (1) Move to waive second reading and adopt Ordinance 314, which would add Chapter 15 to Title V of the Milpitas Municipal Code to prohibit the trespass of canvassers, solicitors and others on residential property; and, (2) Make findings of exemption from environmental review pursuant to CEQA Guidelines §§15061(b)(3), 15183, 15305, and 15378.

BACKGROUND:

On September 3, 2024, the City Council by a vote of four to one introduced this ordinance for a first reading, with an amendment stating the ordinance will not take effect until January 1, 2025.

This ordinance as amended is now ready for its second reading and adoption.

FISCAL IMPACT:

There is no cost to adopt the proposed ordinance beyond incidental publication costs and staff time. There will, however, be minor costs associated with the enforcement of the proposed ordinance. That cost will be offset by the private right of enforcement, which will allow residents to control their property and vindicate their rights without the City having to unnecessarily expend limited enforcement resources.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA):

This ordinance is not a project and is not subject to CEQA review because it does not have the potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change, particularly in that it does not alter the use of land or at most does not do so inconsistently with uses already authorized, prohibited, or regulated by law. (Cal. Code Regs., tit. 14, §15378.) This ordinance also is not a project because it amounts to general policy and procedure making that does not relate to the enactment or amendment of zoning ordinances or the other activities identified as potential “projects.” (Cal. Code Regs., tit. 14, §15378(b)(2).) Furthermore, even if considered a project, this amending ordinance is categorically exempt from CEQA review in that it comprises of non-land use regulations or at most minor alterations in land use limitations that do not result in any changes in land use or density (Cal. Code Regs., tit. 14, §§15305, 15378(a)(1)) and by common sense can be seen with certainly that there is no possibility that the activity in question may have a significant effect on the environment particularly in consideration of the activities already permitted, prohibited, or regulated by law (Cal. Code Regs., tit. 14, §15061(b)(3)). This amending ordinance is also exempt because it does not affect development density established by existing zoning and the City’s General Plan, for which an Environmental Impact Report was already certified, and does not have any project- specific significant environmental effects peculiar to the project or any site. (Cal. Code Regs., tit. 14, §15183.)

RECOMMENDATION:

1. Move to waive second reading and adopt Ordinance 314, which would add Chapter 15 to Title V of the Milpitas Municipal Code to prohibit the trespass of canvassers, solicitors and others on residential property.

2. Make findings of exemption from environmental review pursuant to CEQA Guidelines §§15061(b)(3), 15183, 15305, and 15378.

ATTACHMENT(S):
(a) [Proposed] Ordinance 314, an Ordinance of the City Council of the City of Milpitas Adding Chapter 15 (“Residential Trespass, Canvassing and Solicitation”) to Title V (“Public Health, Safety and Welfare”) of the Milpitas Municipal Code

Ordinance No. 3141

REGULAR
NUMBER: 314
TITLE: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF MILPITAS ADDING CHAPTER 15 (“RESIDENTIAL TRESPASS, CANVASSING AND SOLICITATION”) TO TITLE V (“PUBLIC HEALTH, SAFETY AND
WELFARE”) OF THE MILPITAS MUNICIPAL CODE, RELATING TO THE

TRESPASS OF CANVASERS, SOLICITORS, AND OTHERS ON RESIDENTIAL

PROPERTY
HISTORY:This Ordinance was introduced (first reading) by the City Council at its meeting of ____________________, upon motion by_________________________ and was adopted (second reading) by the City Council at its meeting of _______________, upon motion by ____________________________. The Ordinance was duly passed and ordered published in accordance with law by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

ATTEST: APPROVED:
________________________________ __________________________ Suzanne Guzzetta, City Clerk Carmen Montano, Mayor
APPROVED AS TO FORM:
________________________________
Michael Mutalipassi, City Attorney

Ordinance No. 3142
RECITALS AND FINDINGS:

WHEREAS, persons and entities have been visiting and continue to visit private residential properties for various uninvited purposes, including peddling goods, wares, merchandise, or services, canvassing for support, polls, volunteers, or other purposes, soliciting for orders, donations, or alms, or preaching, proselytizing, or otherwise discussing or distributing news, information, or views; and WHEREAS, residents are concerned that some of these uninvited visitors are going door-to-door to gather information and scrutinize their homes for future burglaries or other crimes; and WHEREAS, residents complain that they have been harassed, intimidated, threatened, or scared while in their own homes by some canvassers and/or solicitors going door-to-door; and WHEREAS, uninvited door-to-door canvassing and solicitation of unwilling residents for any purpose jeopardizes the right of residents in the city to enjoy the privacy of their homes in tranquility and security; and
WHEREAS, property owners and occupants have the right to reasonably control and peacefully enjoy their residential property, including by preventing unlawful trespass upon that property; and WHEREAS, the interests of residents in the privacy and the quiet enjoyment of residential premises are protected by reasonable regulation of unwanted and uninvited door-to-door visitors; and WHEREAS, the City has the power and legitimate interest to secure to residents their ability to self-determine and control the ability of trespassers to intrude upon their residential property, including by prohibiting unwanted canvassers and solicitors; and
WHEREAS, the distribution of canvassing or solicitation materials upon residential property in the city creates a serious police problem and a threat to public safety and welfare including that residential property can become cluttered with an accumulation of such material or otherwise or in addition inadvertently advertise the absence of the owner or occupant and increase the likelihood of criminal activities on the property; and
WHEREAS, such practices, if not in compliance with the reasonable regulation thereof, are injurious and inimical to the public health, safety, and welfare of residents of the city, create a public nuisance, and should therefore be regulated by the city; and WHEREAS, the City has limited resources and staff with which to remedy violations of this Chapter, and that the enforcement of this Chapter will be enhanced—and the public peace, health and safety will be protected—if the owner, occupant, or other person in charge of or lawfully in possession of the property is given a civil remedy against parties violating this Chapter.

NOW, THEREFORE, the City Council of the City of Milpitas does ordain as follows:

SECTION 1. RECORD AND BASIS FOR ACTION
The City Council has duly considered the full record before it, which may include but is not limited to such things as the City staff report, testimony by staff and the public, and other materials and evidence submitted or provided to the City Council. Furthermore, the recitals set forth above are found to be true and correct and are incorporated herein by reference.

Ordinance No. 3143
SECTION 2. ENACTMENT OF MILPITAS MUNICIPAL CODE TITLE V (“PUBLIC HEALTH, SAFETY AND WELFARE”), CHAPTER 15 (“RESIDENTIAL
TRESPASS, CANVASSING AND SOLICITATION”)
Title V (“Public Health, Safety and Welfare”), Chapter 15 (“Residential Trespass, Canvassing and Solicitation”) of the Milpitas Municipal Code is hereby added to read as follows:

Chapter 15 – RESIDENTIAL TRESPASS, CANVASSING AND SOLICITATION Section 1 – Legislative Findings and Declaration of Intent V-15.1.01
The City finds and declares that persons and entities have been visiting and continue to visit private residential properties for various uninvited purposes, including peddling goods, wares, merchandise, or services, canvassing for support, polls, volunteers, or other purposes, soliciting for orders, donations, or alms, or preaching, proselytizing, or otherwise discussing or distributing news, information, or views. The City recognizes the traditional use of such door-to-door visitations for the purpose of communication and commercial pursuits, particularly among grassroot or community organizations and small or local businesses. The City also recognizes that property owners and occupants have the right to control and peacefully enjoy their residential property, and some residents find these activities to be intrusive upon their quiet and privacy. As such, the City enacts this Chapter for the purpose of securing to residents the power to self-determine and choose whether to allow such unsolicited visitors upon their property, including by posting appropriate signs. This Chapter is not intended to prevent or limit entry upon residential property for lawful and legitimate purposes as opposed to permissive entries that a resident may legally choose to limit or refuse.

Section 2 – Definitions
For the purpose of this Chapter only, and not for the purpose of construing any other part of this Code, the following words and phrases shall have the meaning respectively ascribed to them by this Section.

V-15-2.01 – Canvas, Canvasing, and Canvasser
“Canvas” or “Canvasing” shall mean the act of entering or otherwise intruding upon residential property in the city for the purpose of acquiring or disseminating news, information, writings, or views, whether for profit or not, including polling, surveying, preaching, proselytizing, or seeking support for or opposition to any person, cause, organization, philosophy, or venture. A “Canvasser” shall mean any person engaged in or attempting or assisting in canvasing.

V-15-2.02 – Resident
“Resident” shall mean the owner, occupant, or other person in lawful possession of a residential property, in whole or in part, jointly or severally. “Residents” include tenants, lessees, trustees, administrators, property managers, and any person lawfully residing at the property.

V-15-2.03 – Residential Property
“Residential Property” shall mean private property upon which a residential structure is located. “Residential Property” includes the entirety of the private property but does not include any public right of way or access easement over that property. For the purpose of multi-family properties with separately

Ordinance No. 3144
habitable units, each unit shall be separately considered its own residential property and common areas shall not be considered residential property.

V-15-2.04 – Sign
“Sign” shall mean any form of signage otherwise meeting the requirements of Section V-15-3.05, including any placard, decal, sticker, banner, or graphic.

V-15-2.05 – Solicit, Solicitation, and Solicitor
“Solicit” or “Solicitation” shall mean the act entering or otherwise intruding upon residential property in the city for the purpose of offering or acquiring a good, service, investment, or venture, or seeking contributions, gifts, donations, or any other thing of value or compensation of any kind, for whatever purpose or cause whether for profit or not. A “Solicitor” shall mean any person engaged in or attempting or assisting in solicitation.

Section 3 – No Trespass Upon Residential Property
V-15-3.01 – Trespass on Residential Property Prohibited Unless exempt pursuant to Section V-15-3.06, no person shall enter or remain upon any residential property after being notified by a resident to stay away or leave. No person shall enter or reenter residential property they have been so asked to stay away from or leave without receiving express permission to enter from a resident.

V-15-3.02 – Solicitation on Posted Residential Property Prohibited No person shall solicit upon any residential property posted with a “No Soliciting” or other similar sign unless exempt pursuant to Section V-15-3.06.

V-15-3.03 – Canvasing on Posted Residential Property Prohibited No person shall canvass upon any residential property posted with a “No Canvassing” or other similar sign unless exempt pursuant to Section V-15-3.06.

V-15-3.04 – Trespass on Posted Residential Property Prohibited No person shall enter or remain upon any residential property posted with a “No Trespassing” or other similar sign, including for the purpose of soliciting or canvassing therein, unless exempt pursuant to Section V-15-3.06.

V-15-3.05 – Sign Placement and Standards
a. For Sections V-15-3.02, V-15-3.03, or V-15-3.04 to apply, the residential property must be posted with at least one sign with letters at least two-inches in height stating “No Soliciting,” “No Canvassing,” “No Trespassing,” or other words to similar effect, as prescribed by the applicable section, conspicuously posted, visible, and unobstructed at one or more of the following locations:

1. Upon or within five feet of any door or other entrance to any residential unit, structure, vestibule, or enclosed curtilage on the property;

Ordinance No. 3145

2. At or within five feet of the beginning of the walk, driveway, or other path of travel into the property;

3. If the property is enclosed by a fence, upon or within five feet of any gate or other opening in the fence through which people or vehicles could enter; or

4. Upon the mailbox or mailbox post or holder for the property, if the mailbox is detached from the primary residence and located adjacent to the sidewalk. b. The sign may provide conditions to entry or exceptions to any prohibition against entry. c. If at least one such sign is not visible from the sidewalk or other public way adjacent to the property, then without violating Sections V-15-3.02, V-15-3.03, or V-15-3.04, a person otherwise permitted upon the property may enter and directly follow the path of ordinary travel until such time as the sign would become visible and then immediately and without delay leave. In no event may a person so enter the property if he or she knows or reasonably should have known that the property is posted in substantial compliance with Sections V-15-3.02, V-15-3.03, or V-15-3.04. d. A sign posted in substantial compliance with this Section shall be sufficient to sustain a violation.

Where a sign does not strictly comply with this Section, however, there shall be no violation if a defendant can prove by a preponderance of the evidence they neither knew nor reasonable should have known that the property was posted in attempted compliance with Sections V-15-3.02, V-15-

3.03, or V-15-3.04.

V-15-3.06 – Authorization of Police Department to Act
By posting a sign stating “No Soliciting,” “No Canvassing,” “No Trespassing,” or other words to similar effect, the residents of the property shall have authorized any law enforcement officer authorized to enforce a violation of this Chapter to act as their agent for the purpose of enforcement, including warning and forbidding persons from trespassing upon the residential property.

V-15-3.07 – Exception for Residents, Tenants, Occupants, Invitees, Licensees, and Others with Legal Right to Enter
The following persons or entities are exempt from violations of this Chapter:
a. Any resident of the property.
b. A neighbor who enters upon the residential property of another neighbor on an intermittent and infrequent basis for purposes common in the community.
c. Persons delivering mail and shipments through a governmental, common, or private carrier. d. Any person who has express permission to enter or remain upon the property from any resident of the property. The resident who gave this permission may revoke this permission and tell the individual to leave in conformity with Section V-15-3.01 at any time. This exception includes:
i. Deliveries including newspaper deliveries a resident has requested. ii. Good or service providers a resident has requested. iii. Neighbors, relatives, and other persons who have been invited to the property, including on an open or standing basis.
e. The City of Milpitas, or any other government entity, including any governmental employee, officer, official, agent, contractor, volunteer, or other person or entity acting on a government entity’s behalf.
f. Any person who is upon another’s residential property under claim or color of legal right.

Ordinance No. 3146
g. Any person who is upon another’s residential property pertaining to a dispute with a resident of the property where the participants have available to them practical and effective civil remedies, including the following situations:
i. Marital and post-marital disputes;
ii. Child custody or visitation disputes;
iii. Disputes regarding title to or rights in real property; iv. Landlord-tenant disputes;
v. Disputes between members of the same family or between persons residing upon the property concerned up until the time of the dispute;
vi. Employer-employee or contractor-contractee disputes; vii. Business disputes, including between business partners; viii. Debtor-creditor disputes;
ix. Service of legal process; and
x. Instances wherein the person has a bona fide claim of right to be present pursuant to an order, decree, or process of any court or any executive, administrative, judicial, or quasi- judicial official or body.

V-15-3.08 – Calling on to Property, Knocking, Disturbing Peace Also Trespass Even if they do not physically enter upon the property, a person or entity shall have trespassed, canvassed, or solicited in violation of Sections V-15-3.01, V-15-3.02, V-15-3.03, and V-15-3.04 if they otherwise intrude upon the quiet enjoyment of the property in violation of the relevant notification or sign, including by hawking or otherwise making noise, depositing a writing, or otherwise trespassing upon the property or causing or conveying an unwanted act of canvasing or solicitation upon the property.

V-15-3.09 – Sponsoring Person or Entity Liable
In addition to the principal violator, a person or entity on whose behalf an act of trespass, canvassing, or solicitation in violation of this Chapter is done shall be jointly and severally liable for each such violation unless the person or entity can prove by clear and convincing evidence either:
a. The person or entity had no actual or constructive knowledge that the principal violator would be going door-to-door on their behalf; or
b. The person or entity provided the principal violator with a written advisement about the requirements of this Chapter, including a copy of this Chapter, which the principle violator signed acknowledging receipt prior to going door-to-door.

For the purpose of the affirmative defense in Section V-15-3.09(a), there shall be a rebuttable presumption that a person or entity has actual or constructive knowledge of all actions of their employees, agents, officials, contractors, and assigns. The affirmative defense in Section V-15-3.09(b) shall not be available if the person or entity cannot produce a genuine original or copy of the signed written advisement.

V-15-3.10 – Enforcement
a. In addition to all other remedies and actions allowed by law, any violation of this Chapter may be enforced by administrative citation, pursuant to Title I, Chapter 21 of this Code, or criminal prosecution, pursuant to Section I-1-4.09 of this Code. b. At the City Attorney’s discretion, violations of this Chapter may be charged as a misdemeanor, punished by a fine not to exceed the sum of five hundred dollars ($500) or by imprisonment in the County Jail not to exceed six (6) months or by both such fine and imprisonment, or an infraction, punished by a fine not exceeding one hundred dollars ($100) for a first violation, a fine not exceeding two hundred dollars ($200) for a second violation within one year, or a fine not exceeding five hundred dollars ($500) for each additional violation within one year.

Ordinance No. 3147
V-15-3.11 – Private Right of Action Permitted
a. In addition to all other remedies and actions allowed by law, any resident of a property upon which an act of trespass, solicitation, or canvasing has occurred in violation of this Chapter may bring a civil action against any person or entity that has violated Sections V-15-3.01, V-15-3.02, V-15-

3.03, V-15-3.04, and/or V-15-3.09.
b. If the resident prevails in that action, the Court shall award:
a. Injunctive relief sufficient to prevent the defendant(s) from violating this Chapter or engaging in acts that aid, abet, operate, conceal, or allow violations of this Chapter; b. Disgorgement of profits or other monies or value unlawfully obtained in violation of this Chapter;
c. Compensatory damages;
d. A statutory penalty up to one thousand dollars ($1,000.00) per violation; e. Treble damages and/or treble penalties for a second or subsequent violation in any two- year period; and
f. Reasonable attorney’s fees and costs of suit and investigation. c. No award of attorney’s fees against the resident shall be allowed in that action unless the Court determines, upon a duly noticed motion, that the action was not brought in good faith and with reasonable cause.
d. The remedies described in this Section are in addition to any other remedy available at law and do not limit, preclude, or restrict any other right, remedy, or action otherwise available.

SECTION 3. CALIFORNIA ENVIROMENTAL QUALITY ACT (CEQA)
The City Council finds and determines that the adoption of this ordinance is not a project and is not subject to CEQA review because it does not have the potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change, particularly in that it does not alter the use of land or does a most does not do so inconsistently with uses already authorized, prohibited, or regulated by law. (Cal. Code Regs., tit. 14, § 15378.) This ordinance also is not a project because it amounts to general policy and procedure making that does not relate to the enactment or amendment of zoning ordinances or the other activities identified as potential “projects.” (Cal. Code Regs., tit. 14, § 15378(b)(2).) Furthermore, even if considered a project, this amending ordinance is categorically exempt from CEQA review in that it comprises of non-land use regulations or at most minor alterations in land use limitations that do not result in any changes in land use or density (Cal. Code Regs., tit. 14, § 15305, 15378(a)(1)) and by common sense can be seen with certainly that there is no possibility that the activity in question may have a significant effect on the environment particularly in consideration of the activities already permitted, prohibited, or regulated by law (Cal. Code Regs., tit. 14, § 15061(b)(3)). This amending ordinance is also exempt because it does not affect development density established by existing zoning and the City’s General Plan, for which an Environmental Impact Report was already certified, and does not have any project- specific significant environmental effects peculiar to the project or any site. (Cal. Code Regs., tit. 14, § 15183.)
SECTION 4. SEVERABILITY
The provisions of this Ordinance are separable, and the invalidity of any phrase, clause, provision or part shall not affect the validity of the remainder.

SECTION 5. EFFECTIVE DATE AND POSTING

Ordinance No. 3148
In accordance with Section 36937 of the Government Code of the State of California, this Ordinance shall take effect thirty (30) days from and after the date of its passage. Notwithstanding this effective date, however, the provisions of this Ordinance shall not become operative until January 1, 2025. The City Clerk of the City of Milpitas shall cause this Ordinance or a summary thereof to be published in accordance with Section 36933 of the Government Code of the State of California.

CITY OF MILPITAS

AGENDA REPORT
(AR)
Item Title: Appointment of Voting Delegates for the Annual California League of Cities Conference (Staff Contact: Matt Cano, Assistant City Manager, 408-586-3012) Category: Consent Calendar-Leadership and Support Services Meeting Date: 9/17/2024
Recommendation: Appoint Mayor Carmen Montano as the City’s voting delegate and City Manager Ned Thomas as the alternate voting delegate for the 2024 Annual League of California Cities Conference.

BACKGROUND:

The League of California Cities holds its Annual Conference and Expo from October 16th to October 18th in Long Beach, California. Mayor Montano and City Manager Ned Thomas will likely be attending, pending City Council approval at the October 1, 2024 City Council meeting.

ANALYSIS:

The California League of Cities will hold its General Assembly on October 18, 2024. This is an important opportunity where city officials can directly participate in the development of Cal Cities policy. Every city has one voting delegate at the General Assembly. Cal Cities bylaws require that a city’s voting delegate and up to two alternates be designated by its City Council and submitted to Cal Cities by September 25, 2024. This agenda report is being brought to the City Council for consideration prior to the request for travel approval, due to the need to appoint the voting delegate by September 25, 2024.

POLICY ALTERNATIVE(S):

Not Applicable
FISCAL IMPACT:

There is no fiscal impact associated with this action.

California Environmental Quality Act (CEQA):

The action is an organizational or administrative activity of the City government that will not result in direct or indirect physical changes in the environment and is not a project pursuant to Cal. Code of Regs., tit. 14, §15378.

RECOMMENDATION:

Appoint Mayor Carmen Montano as the City’s voting delegate and City Manager Ned Thomas as the alternate voting delegate for the 2024 Annual League of California Cities Conference.

Attachment(s):
(a) Letter to Mayors, Councilmembers, City Clerks and City Managers from Cal Cities regarding the process for appointing a voting delegate.

1400 K Street, Suite 400, Sacramento, CA 95814 • 916.658.8200 • calcities.org

DATE: Wednesday, July 10, 2024

TO: Mayors, Council Members, City Clerks, and City Managers

RE: DESIGNATION OF VOTING DELEGATES AND ALTERNATES
League of California Cities Annual Conference and Expo, Oct. 16-18, 2024 Long Beach Convention Center

Every year, the League of California Cities convenes a member-driven General Assembly at the Cal Cities Annual Conference and Expo. The General Assembly is an important opportunity where city officials can directly participate in the development of Cal Cities policy.

Taking place on Oct. 18, the General Assembly is comprised of voting delegates appointed by each member city; every city has one voting delegate. Your appointed voting delegate plays an important role during the General Assembly by representing your city and voting on resolutions.

To cast a vote during the General Assembly, your city must designate a voting delegate and up to two alternate voting delegates, one of whom may vote if the designated voting delegate is unable to serve in that capacity. Voting delegates may either be an elected or appointed official.

Action by Council Required. Consistent with Cal Cities bylaws, a city’s voting delegate and up to two alternates must be designated by the city council. Please note that designating the voting delegate and alternates must be done by city council action and cannot be accomplished by individual action of the mayor or city manager alone.

Following council action, please submit your city’s delegates through the online submission portal by Wed., Sept. 25. When completing the Voting Delegate submission form, you will be asked to attest that council action was taken. You will need to be signed in to your My Cal Cities account when submitting the form.

Submitting your voting delegate form by the deadline will allow us time to establish voting delegate/alternate records prior to the conference and provide pre-conference communications with voting delegates.

Conference Registration Required. The voting delegate and alternates must be registered to attend the conference. They need not register for the entire conference; they may register for Friday only. Conference registration is open on the Cal Cities website.

Council Action Advised by September 25, 2024

For a city to cast a vote, one voter must be present at the General Assembly and in possession of the voting delegate card and voting tool. Voting delegates and alternates need to pick up their conference badges before signing in and picking up the voting delegate card at the voting delegate desk. This will enable them to receive the special sticker on their name badges that will admit the voting delegate into the voting area during the General Assembly.

Please view Cal Cities’ event and meeting policy in advance of the conference.

Transferring Voting Card to Non-Designated Individuals Not Allowed. The voting delegate card may be transferred freely between the voting delegate and alternates, but only between the voting delegate and alternates. If the voting delegate and alternates find themselves unable to attend the General Assembly, they may not transfer the voting card to another city official.

Seating Protocol during General Assembly. At the General Assembly, individuals with a voting card will sit in a designated area. Admission to the voting area will be limited to the individual in possession of the voting card and with a special sticker on their name badge identifying them as a voting delegate.

The voting delegate desk, located in the conference registration area of the Long Beach Convention Center in Long Beach, will be open at the following times: Wednesday, Oct. 16, 8:00 a.m.-6:00 p.m. and Thursday, Oct. 17, 7:30 a.m.-4:00 p.m. On Friday, Oct. 18, the voting delegate desk will be open at the General Assembly, starting at 7:30 a.m., but will be closed during roll calls and voting.

The voting procedures that will be used at the conference are attached to this memo.

Please share these procedures and this memo with your council and especially with the individuals that your council designates as your city’s voting delegate and alternates.

Once again, thank you for submitting your voting delegate and alternates by Wednesday, Sept. 25. If you have questions, please contact Zach Seals at [email protected].

Attachments:
• General Assembly Voting Guidelines
• Information Sheet: Cal Cities Resolutions and the General Assembly

1400 K Street, Suite 400, Sacramento, CA 95814 • 916.658.8200 • calcities.org

General Assembly Voting Guidelines

1. One City One Vote. Each member city has a right to cast one vote on matters pertaining to Cal Cities policy.

2. Designating a City Voting Representative. Prior to the Cal Cities Annual Conference and Expo, each city council may designate a voting delegate and up to two alternates; these individuals are identified on the voting delegate form provided to the Cal Cities Credentials Committee.

3. Registering with the Credentials Committee. The voting delegate, or alternates, may pick up the city's voting card at the voting delegate desk in the conference registration area. Voting delegates and alternates must sign in at the voting delegate desk. Here they will receive a special sticker on their name badge and thus be admitted to the voting area at the General Assembly.

4. Signing Initiated Resolution Petitions. Only those individuals who are voting delegates (or alternates), and who have picked up their city’s voting card by providing a signature to the credentials committee at the voting delegate desk, may sign petitions to initiate a resolution.

5. Voting. To cast the city's vote, a city official must have in their possession the city's voting card and voting tool; and be registered with the credentials committee. The voting card may be transferred freely between the voting delegate and alternates but may not be transferred to another city official who is neither a voting delegate nor alternate.

6. Voting Area at General Assembly. At the General Assembly, individuals with a voting card will sit in a designated area. Admission to the voting area will be limited to the individual in possession of the voting card and with a special sticker on their name badge identifying them as a voting delegate.

7. Resolving Disputes. In case of dispute, the credentials committee will determine the validity of signatures on petitioned resolutions and the right of a city official to vote at the General Assembly.

Sixty days before the
Annual Conference
and Expo, Cal Cities
members may submit
policy proposals on
issues of importance
to cities. The resolution must
have the concurrence of at least
five additional member cities or
individual members.

How it works: Cal Cities
Resolutions and the General Assembly
General Assembly
General Resolutions Policy Committees
Developing League of California Cities policy is a dynamic process that engages a wide range of members to ensure Cal Cities represents cities with one voice. These policies directly guide Cal Cities’ advocacy to promote local decision-making, and lobby against statewide policies that erode local control.

The resolutions process and General Assembly is one way that city officials can directly participate in the development of Cal Cities policy. If a resolution is approved at the General Assembly, it becomes official Cal Cities policy. Here’s how resolutions and the General Assembly work.

The petitioned
resolution is an
alternate method
to introduce policy
proposals during
the annual conference. The
petition must be signed by
voting delegates from 10% of
member cities, and submitted to
the Cal Cities President at least
24 hours before the beginning
of the General Assembly.

Petitioned Resolutions
The Cal Cities
President assigns
general resolutions
to policy committees
where members
review, debate, and recommend
positions for each policy proposal.

Recommendations are forwarded
to the Resolutions Committee.

Who’s who
The Resolutions Committee
includes representatives
from each Cal Cities
diversity caucus, regional
division, municipal
department, and policy
committee, as well as
individuals appointed by
the Cal Cities president.

Voting delegates
are appointed by each
member city; every city
has one voting delegate.

The General Assembly is a
meeting of the collective
body of all voting
delegates —one from
every member city.

Seven policy committees
meet throughout the year
to review and recommend
positions to take on bills
and regulatory proposals.

Policy committees include
members from each Cal
Cities diversity caucus,
regional division, and
municipal department,
as well as individuals
appointed by the Cal
Cities president.

During the General Assembly, voting delegates
debate and consider general and petitioned
resolutions forwarded by the Resolutions
Committee. Potential Cal Cities bylaws
amendments are also considered at this meeting.

Cal Cities policy
development is a member-
informed process,
grounded in the voices and
experiences of city officials
throughout the state.

For more information visit www.calcities.org/general-assembly Prior to the Annual Conference and Expo
Resolutions Committee
The Resolutions
Committee considers
all resolutions. General
Resolutions approved1 by
either a policy committee
or the Resolutions Committee are next
considered by the General Assembly.

General resolutions not approved, or
referred for further study by both a
policy committee and the Resolutions
Committee do not go to the General
Assembly. All Petitioned Resolutions
are considered by the General
Assembly, unless disqualified.2
During the Annual Conference and Expo
1 The Resolution Committee can amend a general resolution prior to sending it to the General Assembly. 2 Petitioned Resolutions may be disqualified by the Resolutions Committee according to Cal Cities Bylaws Article VI. Sec. 5(f).

CITY OF MILPITAS

AGENDA REPORT
(AR)
Item Title: Adopt a Resolution Approving the City of Milpitas Investment Policy for Fiscal Year 2024-25 (Staff Contact: Luz Cofresí-Howe, Director of Finance, 408-586- 3111)
Category: Consent Calendar-Leadership and Support Services Meeting Date: 8/15/2024
Recommendation: Adopt a resolution approving the City of Milpitas Investment Policy for FY 2024-25.

BACKGROUND:

California state law regarding the investment of public funds requires all local agencies develop an investment policy that must be considered annually by the legislative body of the local agency at a public meeting. Staff works closely with the City investment advisors to review and update the City Investment Policy (Policy) for City Council consideration, ensuring the Policy captures the latest changes to California Government Code as well as best practices. The Investment Policy for the City of Milpitas is herewith submitted for Council’s annual review and approval.

ANALYSIS:

Staff and the City investment advisors collaborated in reviewing the current City Policy and determined it continues to comply with the provisions of the California Government Code (Code) §§16340, 16429.1-16429.4 and 53600 et seq., the authority governing investments for municipal governments. There were changes to the statutes that govern the City’s investments as a result of the State adoption of Senate Bill 882, clarifying a gray area of Code regarding the categorization of pass-through securities issued by the United States government, its federal agencies, and government-sponsored enterprises. However, the current City investment policy already embodied the new interpretation.

The most substantive change to the City Policy is related to the inclusion of local government investment pools (LGIP) as permitted investments. LGIPs are governmental investment pools organized as joint powers authorities. The securities in the pools must be allowed in an approved investment policy by Code. Moreover, the pools currently available in California tend to be in the highest rating category and focus on providing their participants same-day or next-day liquidity. The City Policy already includes a section on performing due diligence on any pooled investments such as money market mutual funds and the State of California Local Agency Investment Fund (LAIF), the State Treasurer’s pool. Inclusion of LGIPs in the City investment portfolio will allow the City to diversify its most liquid investments. LGIPs will also be subject to the City’s usual, rigorous due diligence process.

There were additional minor changes intended to provide updates to acronyms and names, as well as cleaning up language from prior versions. Staff recommends adopting the changes as proposed.

FISCAL IMPACT:

None; there is no fiscal impact because of the changes recommended to the policy.

California Environmental Quality Act (CEQA):

The City Council adoption of the resolution is not a “project” under the California Environmental Quality Act (CEQA) pursuant to CEQA Guideline §15378(b)(5) because it is an administrative activity that will not result in a direct or indirect physical change in the environment.

RECOMMENDATION:

Adopt a resolution approving the City of Milpitas Investment Policy for FY 2024-25.

Attachment(s):
(a) Investment Policy FY 2024-25 (Redlined)
(b) Investment Policy FY 2024-25 (Clean)
(c) Draft Resolution

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

POLICY OVERVIEW

PURPOSE
The purpose of this Investment Policy (Policy) is to establish overall guidelines for the management and investment of the City of Milpitas (City) unexpended funds under authority granted by the City Council.

This Policy is in compliance with the provisions of the California Government Code, Sections 16340, 16429.1- 16429.4, and 53600-53686, the authority governing investments for municipal governments.

INVESTMENT OBJECTIVES
The primary objectives of this Policy, in order of priority, are safety, liquidity, and return:
1)Safety. Safety of principal is the foremost objective of the investment program. Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. This objective shall be accomplished by mitigating credit risk and market risk. 2)Liquidity. The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This objective shall be accomplished by structuring the portfolio so securities mature concurrently with anticipated needs. The investment portfolio shall consist largely of securities with active secondary or resale markets.

Furthermore, a portion of the portfolio may be placed in money market funds or Local Agency Investment Fund (LAIF) which offer same day liquidity for short-term investment. 3)Return. The investment portfolio is designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into consideration the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives described above. The core of investments is limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed. Nevertheless, investment performance shall be continually monitored and evaluated by the City Treasurer by comparison with other investment portfolio benchmarks.

Additionally, investments are to be made that will bear in mind the responsibility of the City government to its citizens. The following investment considerations, which enhance the quality of life, will be adhered to:
•Divestment From Publicly-Traded Fossil Fuel Companies. The City of Milpitas has a responsibility to protect the lives and livelihoods of its inhabitants from the threat of climate change. The City believes its investments should support a future where all citizens residents can live healthy lives without the negative impacts of a warming environment. For the purposes of the Investment Policy, a "fossil fuel company" shall be defined as any of the two hundred publicly-traded companies with the largest coal, oil and gas reserves as measured by the gigatons of carbon dioxide that would be emitted if those reserves were extracted and burned, as listed in the Carbon Tracker Initiative's "Unburnable Carbon" report. Staff responsible for managing the City investment portfolio are directed to divest all City investment funds held in fossil fuel companies once they reach their maturities, and are prohibited from making any new investments in such companies.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

SCOPE
The Policy applies to all financial assets of the City of Milpitas as accounted for in the Annual Comprehensive Financial Report (ACFR), including but not limited to the funds listed below:
•General Fund
•Special Revenue Funds
•Capital Projects Funds
•Debt Service Fund
•Enterprise Funds
•Internal Service Fund
•Trust and Agency Funds
Any new fund created by the City Council unless specifically exempted with the exception of the following:
1) The City Deferred Compensation Plan is excluded as it is managed by a third- party administrator and invested by individual plan participants. 2) Proceeds of debt issuance shall be invested in accordance with the investment objectives of this Policy. However, such proceeds are generally invested in accordance with permitted investment provisions of their specific bond indentures. If the City Treasurer determines that the matching of bond reserve funds with the maturity schedule of an individual bond issue is prudent, the Policy authorizes extending beyond the five-year maturity limitation as outlined in this document.

STANDARDS OF CARE
1)Prudence. Pursuant to California Government Code, Section 53600.3, all persons authorized to make investment decisions on behalf of the City are trustees and therefore fiduciaries subject to the prudent investor standard:
“…all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the Agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the Agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.”
The City Treasurer and other individuals assigned to manage the investment portfolio, acting within the intent and scope of the Policy and other written procedures, and exercising due diligence, shall be relieved of personal responsibility and liability for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely manner and appropriate action is taken to control adverse developments.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

2)Ethics and Conflict of Interest. Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program or could impair their ability to make impartial investment decisions. City employees involved in the investment process shall disclose to the City Manager any material financial interest in financial institutions that conduct business within the jurisdiction. They shall further disclose any large personal financial/investment positions that could affect the performance of the investment portfolio.
3)Delegation of Authority. Authority to manage the investment program is derived from California Government Code, Sections 41006 and 53600 et seq and granted to the City Treasurer by Section VI- 1-3.04 of the City of Milpitas Municipal Code. Under the oversight of the City Treasurer, responsibility for the operation of the investment program may be delegated to the Finance Administration staff, who shall act in accordance with established written procedures and internal controls consistent with the Policy. The City Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of the subordinate staff members. The system of internal controls includes separation of duties, custodial safekeeping, avoidance of physical delivery securities, development of wire transfer agreement, and clear delegation of authority to subordinate staff members. The City may engage the services of one or more external investment advisers, who are registered under the Investment Advisers Act of 1940, to assist in the management of the City investment portfolio in a manner consistent with City objectives. External investment advisers may be granted discretion to purchase and sell investment securities in accordance with this Policy. The City overall investment program shall be designed and managed with a degree of professionalism that is worthy of the public trust. The City recognizes that in a diversified portfolio, occasional measured losses may be inevitable and must be considered within the context of the overall portfolio return and cash flow requirements of the City.

INVESTMENT GUIDELINES

INVESTMENT PARAMETERS
•Maximum Maturities. To the extent possible, the City shall attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow, the City will not directly invest in securities maturing more than five (5) years from the date of trade settlement. The intent to invest in securities beyond the five-year maturity limitation shall be disclosed in writing to the City Council no less than 3 months prior to the investment. Reserve funds established by the issuance of bonds and other funds with longer-term investment horizons may be invested in securities exceeding five years if the maturity of such investments is made to coincide with the expected use of funds.
•Competitive Bidding. It is the practice of the City to require that, where possible, all transactions with broker/dealers shall be selected on a competitive basis and their bid or offering prices shall be recorded. If there is no other readily available competitive offering, best efforts will be made to document quotations for comparable or alternative securities. When purchasing original issue instrumentality securities, no competitive offerings will be required as all dealers in the selling group offer those securities at the same original issue price.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

PERFORMANCE EVALUATION/BENCHMARK
•The investment portfolio shall be designed to attain a market-average rate of return throughout budgetary and economic cycles, considering City risk constraints, the cash flow characteristics of the portfolio, and state and local laws, ordinances or resolutions that restrict investments.

Investment performance is continually monitored and evaluated by the City Treasurer.

Investment performance statistics and activity reports are prepared on a quarterly basis for presentation to the City Manager and City Council within 30 45 days of the end of the quarter. •The City Treasurer shall select an appropriate, readily available index to use as a market benchmark. The benchmark should be commensurate with the level of market risk of the portfolio, and should serve as a measure of risk, interest income, and fair value appreciation.

Samples of readily available benchmarks include Intercity Exchange/Bank of America/Merrill Lynch 1-3 Year or 1-5 Year Treasury Indices.

SAFEKEEPING OF SECURITIES
•To protect against fraud or embezzlement or losses caused by collapse of an individual securities dealer, all securities owned by the City shall be held in safekeeping by a third-party bank trust department, acting as agent for the City under the teams of a custody agreement or master repurchase agreement. All trades executed by a dealer will settle delivery vs. payment (DVP) through the City safekeeping agent.
•Securities held in custody for the City shall be reviewed and verified quarterly by Finance staff who have not been assigned to the investment function.

INTERNAL CONTROL
The City Treasurer is responsible for establishing and maintaining an internal control structure designed to ensure the assets of the City are protected from loss, theft or misuse. The internal controls structure shall be designed to provide reasonable assurance these objectives are met. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits to be derived and that the valuation of costs and benefits requires estimates and judgments by management.

The internal controls shall address the following points:
•Control of collusion
•Separation of transaction authority from accounting and record keeping •Custodial safekeeping
•Avoidance of physical delivery securities
•Clear delegation of authority to subordinate staff members •Written confirmation of transactions for investments and wire transfers •Development of a wire transfer agreement with the lead bank and third-party custodian

REPORTING
The City Treasurer shall review and render quarterly reports to the City Manager and City Council which shall include:

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

•Investment information, including the par and dollar amount of the investment, the classification of the investment, the percentage of the total portfolio which each type of investment represents, the name of the institution or entity, the rate of interest, the maturity date, the current market value, and the source of the market value.
•Statement that the projected cash flow is adequate to meet expected obligations over the next six months.
•A report of transactions by month.
•The weighted average maturity of the investment portfolio. •The average weighted yield to maturity of the portfolio as compared to the applicable benchmark.
•Statement of compliance with the Policy.

The report is due within 45 days of the end of the quarter. The City Manager may, at his discretion, require this reporting on a monthly basis based upon market conditions.

QUALIFIED BROKER/DEALERS
The City shall transact business with financial institutions and security broker/dealers after careful review of their qualifications and creditworthiness. All dealers who desire to do business with the City shall provide the necessary information (e.g., audited financial statements, proof of state registration, proof of National Association of Securities Dealers certification, etc.) from which the City can determine their creditworthiness, the existence of any pending legal action against the firm or the individual broker, as well as an understanding of the security markets that they service. The City Treasurer shall annually send a copy of the current Policy to all financial institutions and broker/dealers approved to do business with the City. Confirmation of receipt of this Policy shall be considered evidence that the dealer understands the City Investment Policy and intends to sell the City only appropriate investments authorized by this Investment Policy.

In accordance with California Government Code Section 53601.5, any investment authorized pursuant to Section 53601 or 53601.1, not purchased directly from the issuer, shall be purchased either from an institution licensed by the state as a broker-dealer, as defined in Section 25004 of the Corporations Code, or from a member of a federally regulated securities exchange, from a national or state-chartered bank, from a savings association or federal association (as defined by Section 5102 of the Financial Code) or from a brokerage firm designated as a primary dealer by the Federal Reserve bank.

Selection of financial institutions and broker/dealers authorized to engage in transactions will be at the sole discretion of the City, except where the City utilizes an external investment adviser in which case the Agency may rely on the adviser for selection.

COLLATERAL REQUIREMENTS
Collateral is required for investments in non-negotiable certificates of deposit and repurchase agreements. To reduce market risk, the collateral level shall be at least 102% of market value of principal and accrued interest and marked-to-market weekly. Securities acceptable as collateral shall be the direct obligations of or are fully guaranteed as to principal and interest by the United States or any agency of the United States.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

The City shall require any bank or financial institution to comply with the collateralization criteria defined in California Government Code, Section 53651.

AUTHORIZED INVESTMENTS
Investment of City funds is governed by the California Government Code, Sections 16340, 16429.1- 16429.4, and 53600-53686. Within the context of the limitations, the following investments are authorized, as further limited herein. In the event a discrepancy is found between this Policy and the Code, the more restrictive parameters will take precedence. Percentage holding limits and minimum credit quality requirements listed in this section apply at the time the security is purchased.

Any investment currently held at the time the Policy is adopted which does not meet the new Policy guidelines can be held until maturity and shall be exempt from the current Policy. At the time of the investment’s maturity or liquidation, such funds shall be reinvested only as provided in the current Policy.

An appropriate risk level shall be maintained by primarily purchasing securities that are of high quality, liquid, and marketable. The portfolio shall be diversified by security type and institution to avoid incurring unreasonable and avoidable risks regarding specific security types or individual issuers. 1)United States Treasury Bills, Bonds, and Notes or those for which the full faith and credit of the United States are pledged for payment of principal and interest. There is no percentage limitation of the portfolio which can be invested in this category, though a five-year maturity limitation is applicable.
2)Federal Agency Obligations or United States Government-Sponsored Enterprise (GSE) obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or Unites States government sponsored enterprises. There is no percentage limitation of the portfolio which can be invested in this category, although a five-year maturity limitation is applicable. Additionally, no more than 30% of the portfolio may be invested in any single Agency/GSE issuer, and the maximum percent of agency callable securities in the portfolio will be 20%. 3)Banker’s Acceptances. Bills of exchange or time drafts drawn on and accepted by commercial banks, otherwise known as banker's acceptances. Banker’s acceptances must be issued by institutions which have short-term debt obligations rated “A-1” or its equivalent or better by at least one nationally recognized statistical rating organization (NRSRO), or long-term debt obligations which are rated in a rating category of “A” or its equivalent or better by at least one NRSRO. Purchase of banker's acceptances may not exceed 180 days maturity or 40% of the value of the portfolio. Furthermore, no more than 5% of the value of the portfolio may be invested in the banker's acceptances of any one commercial bank. 4)Commercial Paper of the highest letter and number rating as provided by at least one NRSRO, either:
a. Issued by general corporations organized and operating within the United States, having assets in excess of $500,000,000 and having a rating in the rating category of "A" or its equivalent or better rating on debt other than commercial paper as provided by at least one NRSRO, or

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

b. Issued by entities organized within the United States as a special purpose corporation, trust, or limited liability company. The securities must have program-wide credit enhancements including, but not limited to, overcollateralization, letters of credit, or a surety bond. The securities must by rated “A-1” or its equivalent or better by at least one NRSRO.

Purchases of eligible commercial paper may not exceed 270 days maturity nor represent more than 10% of the outstanding paper of the issuing corporation. Purchases of commercial paper may not exceed 25% of the value of the portfolio. No more than 5% of the portfolio may be invested in any single issuer. Under a provision sunsetting on January 1, 2026, no more than 40% of the portfolio may be invested in Commercial Paper if the City investment assets under management are greater than $100,000,000.
5)Negotiable Certificates of Deposit issued by nationally or state-chartered banks, a savings association, or a federal association, a state or federal credit union, or by a federally-licensed or state-licensed branch of a foreign bank. Purchases of negotiable certificates of deposit may not exceed 30% of the value of the portfolio. No more than 5% of the portfolio may be invested in any single issuer. A maturity limitation of five years is applicable. The amount of negotiable certificates of deposit insured up to the FDIC limit does not require any credit ratings. Any amount above the FDIC insured limit must be issued by institutions which have short-term debt obligations rated “A-1” or its equivalent or better by at least one NRSRO, or long-term obligations rated in a rating category of “A” or its equivalent or better by at least one NRSRO. 6)Repurchase Agreements. Repurchase agreements collateralized with securities authorized under in accordance with California Government Code Section 53601(j). There are no limits on the dollar amount or percentage the City may invest. The maturity of the repurchase agreements shall not exceed one year. The market value of the securities used as collateral for the repurchase agreements shall be monitored by the investment staff weekly and shall not be allowed to fall below 102% of the value of the repurchase agreement. A Master Repurchase agreement is required between the City and the dealer for all repurchase agreements transacted. 7)Time Deposits. Time deposits, non-negotiable and collateralized in accordance with the California Government Code, may be purchased through banks or savings and loan associations. A maturity limitation of five years is applicable. 8)Medium-Term Corporate Notes issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States with a maximum maturity of five years may be purchased.

Securities eligible for investment shall be rated in a rating category of "A" or its equivalent better by at least one NRSRO. Purchase of medium-term notes may not exceed 30% of the value of the portfolio and no more than 5% of the value of the portfolio may be invested in notes issued by one corporation.
9)Local Agency Investment Fund (LAIF). a State of California managed investment pool may be used up to the maximum permitted in accordance with California Government Code Section 16429.1.
10)Money Market Funds. Money Market funds invested in U.S. Government securities are permitted under this Policy and under the California Government Code Section 53601. To be

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eligible for investment under this section, an investment objective of such a fund must be the maintenance of a price per share of $1.00. Investment in such funds shall not exceed 20% of the City total portfolio and no more than 10% of the City total portfolio may be invested in any one money market fund. In addition, either one of the following criteria must be met:
a. The fund shall have achieved a rating of "AAA" by at least two nationally recognized statistical rating organizations, or
b. The fund shall have retained an advisor who is registered or exempt from registration with the Security Exchange Commission with not less than five years' experience managing money market funds with assets under management in excess of five hundred million dollars ($500,000,000).
11)Municipal Securities including obligations of the City, the State of California, and any local agency within the State of California, provided that:
a. The securities are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
b. No more than 5% of the portfolio may be invested in any single issuer. c. No more than 30% of the portfolio may be in Municipal Securities. d. The maximum maturity does not exceed five (5) years. 12)Municipal Securities (Registered Treasury Notes or Bonds) of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue- producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California., provided that:
a. The securities are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
b. No more than 5% of the portfolio may be invested in any single issuer. c. No more than 30% of the portfolio may be in Municipal Securities. d. The maximum maturity does not exceed five (5) years. 13)Asset-Backed, Mortgage-backed, Mortgage Passthrough Securities, and Collateralized Mortgage Obligations From Issuers Not Defined In Sections 1 And 2 of the Authorized Investments Section of this Policy, provided that:
a. The securities are rated in a rating category of “AA” or its equivalent or better by a NRSRO.
b. No more than 20% of the total portfolio may be invested in these securities. c. No more than 5% of the portfolio may be invested in any single Asset-Backed or Commercial Mortgage security issuer.
d. The maximum legal final maturity does not exceed five (5) years.

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14)Collateralized Bank Deposits. City deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651. There are no limits on the dollar amount or percentage that the City may invest in collateralized bank deposits. 15)Supranational Securities. Provided that issues are US dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank. The securities must be rated in a rating category of “AA” or its equivalent or better by a NRSRO. No more than 30% of the total portfolio may be invested in these securities. No more than 10% of the portfolio may be invested in any single issuer. The maximum maturity does not exceed five (5) years.
16) Local Government Investment Pools (LGIP) which are shares of beneficial interest issued by a joint powers authority organized pursuant to Section 6509.7 that invests in securities and obligations authorized in California Government Code 53601 subdivisions (a) to (r), inclusive, where each share shall represent an equal proportional interest in the underlying pool of securities owned by the joint powers authority.
a. The joint powers authority issuing the shares must retain an investment adviser who is registered or exempt from registration with the Securities and Exchange Commission (SEC), has assets under management in excess of $500 million, and has at least five years of experience investing in the securities and obligations authorized by Section 53601, subdivisions (a) to (q).
b. Ratings of a LGIP must be in a rating category of “AAA” or its equivalent by at least one NRSRO. If rated by more than one organization, no rating may be lower than the category described in the preceding sentence.
c. No more than 10% of the portfolio shall be invested in any single LGIP. d. LGIP investments may not exceed 20% of the City portfolio in the aggregate.

INELIGIBLE INVESTMENTS AND INVESTMENT PRACTICES
Ineligible investments are those that are not described herein, including but not limited to, common stocks, reverse repurchase agreements, inverse floaters, range notes, mortgage derived interest only strips, derivatives securities, or any security that could result in zero interest accrual. Under a provision sunsetting on January 1, 2026, securities backed by the U.S. Government that could result in a zero- or negative-interest accrual if held to maturity are permitted. Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited. Purchasing or selling securities on margin is prohibited. The use of reverse repurchase agreements, securities lending or any other form of borrowing or leverage is prohibited. The purchase of foreign currency denominated securities is prohibited. The purchase of securities with a forward settlement date exceeding 45 days from the time of the investment is prohibited.

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RISK MANAGEMENT AND DIVERSIFICATION
Mitigating Credit Risk in the Portfolio. Credit risk is the risk a security or a portfolio will lose some or all its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:
•The diversification requirements included in the “Authorized Investments” section of this Policy are designed to mitigate credit risk in the portfolio.
•No more than 5% of the total portfolio may be deposited with or invested in securities issued by any single issuer unless otherwise specified in this Policy. •The City may elect to sell a security prior to its maturity and record a capital gain or loss to manage the quality, liquidity, or yield of the portfolio in response to market conditions or City risk preferences.
•If a security owned by the City is downgraded to a level below the requirements of this Policy, making the security ineligible for additional purchases, the following steps will be taken:
oAny actions taken related to the downgrade by the investment manager will be communicated to the City Treasurer in a timely manner.
oIf a decision is made to retain the security, the credit situation will be monitored and reported to the City Council in the Quarterly Investment Report.

Mitigating Market Risk in the Portfolio. Market risk is the risk the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. On the other hand, longer-term portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short- term cash needs, and by making longer-term investments only with funds that are not needed for current cash flow purposes.

The City further recognizes certain types of securities, including variable rate securities, securities with principal paydowns prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk:
•The City will maintain a minimum of six months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements. •The maximum stated final maturity of individual securities in the portfolio will be five (5) years, except as otherwise stated in this Policy.
•The duration of the portfolio will generally be approximately equal to the duration (typically, plus or minus 20%) of a market benchmark as described in the Performance Evaluation/Benchmark section of this Policy, an index selected by the City based on the City investment objectives, constraints, and risk tolerances.

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INVESTMENT POOLS/MUTUAL FUNDS
The City shall conduct a thorough investigation of any pool or mutual fund prior to making an investment, and on a continual basis thereafter. The Treasurer shall develop a questionnaire which will answer the following general questions:
a. A description of eligible investment securities, and a written statement of Policy and objectives. b. A description of interest calculations and how it is distributed, and how gains and losses are treated.
c. A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited. d. A description of who may invest in the program, how often, what size deposit and withdrawal are allowed.
e. A schedule for receiving statements and portfolio listings. f. Are reserves, retained earnings, etc. utilized by the pool/fund? g. A fee schedule, and when and how is it assessed.
h. Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds?

INTEREST EARNINGS
All moneys earned and collected from investments authorized in this Policy shall be allocated monthly to various fund accounts based on the cash balance in each fund as a percentage of the entire pooled portfolio.

ANNUAL POLICY APPROVAL
The City Investment Policy shall be adopted by resolution of the City Council on an annual basis. This Policy shall be reviewed at least annually to ensure its consistency with the overall objectives of safety of principal, liquidity and yield, and its relevance to current law and financial and economic trends. Any amendments to the Policy shall be forwarded to City Council for approval.

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GLOSSARY OF TERMS

Accrued Interest. Interest earned but not yet received.

Active Deposits. Funds which are immediately required for disbursement.

Amortization. An accounting practice of gradually decreasing (increasing) an asset's book value by spreading its depreciation (accretion) over a period of time.

Arbitrage. Transactions by which securities are bought and sold in different markets at the same time for the sake of the profit arising from a yield difference in the two markets.

Asked Price. The price a broker dealer offers to sell securities.

Banker's Acceptance. A high-quality, short-term money market instrument used to finance international trade. There has never been an instance of a failure to pay a banker's acceptance in full at its maturity date.

Basis Point. One basis point is one hundredth of one percent (.01).

Bid Price. The price a broker dealer offers to purchase securities.

Bond. A financial obligation for which the issuer promises to pay the bondholder a specified stream of future cash flows, including periodic interest payments and a principal repayment.

Book Value. The value at which a debt security is shown on the holder's balance sheet. Book value is acquisition cost less amortization of premium or accretion of discount.

Broker. Someone who brings buyers and sellers together and is compensated for his/her service.

Certificate of Deposit. A deposit insured by the FDIC at a set rate for a specified period of time.

Collateral. Securities, evidence of deposit or pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposit of public moneys.

Commercial Paper. Short-term, negotiable unsecured promissory notes of corporations.

Annual Comprehensive Financial Report (ACFR). The official annual financial report for the City, prepared in conformity with Generally Accepted Accounting Principles (GAAP).

Coupon. The annual rate of interest that a bond issuer promises to pay the bondholder on the bond's face value.

Credit Risk. Defined as the risk of loss due to failure of the issuer of a security.

Current Yield. The interest paid on an investment expressed as a percentage of the current price of the security.

Custodian. A bank or other financial institution that keeps custody of stock certificates and other assets.

Defeased Bond Issues. Issues that have sufficient money to retire outstanding debt when due so that the agency is released from the contracts and covenants in the bond document.

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GLOSSARY OF TERMS

Delivery vs. Payment (DVP). Delivery of securities with a simultaneous exchange of money for the securities.

Derivative. Securities that are based on, or derived from, some underlying asset, reference date, or index.

Discount. The difference between the cost of a security and its value at maturity when quoted at lower than face value.

Diversification. Dividing investment funds among a variety of securities offering independent returns and risk profiles.

Duration. A measure of the timing of the cash flows, such as the interest payments and the principal repayment, to be received from a given fixed-income security. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity. The duration of a security is a useful indicator of its price volatility for given changes in interest rates.

Fannie Mae. Trade name for the Federal National Mortgage Association (FNMA), a U.S. sponsored corporation.

Federal Reserve System. The central bank of the U.S. which consists of a seven member Board of Governors, 12 regional banks and 5,700 commercial banks that are members.

Federal Deposit Insurance Corporation (FDIC). Insurance provided to customers of a subscribing bank which guarantees deposits to a set limit (currently $250,000) per account.

Fed Wire. A wire transmission service established by the Federal Reserve Bank to facilitate the transfer of funds through debits and credits of funds between participants within the Fed system.

Freddie Mac. Trade name for the Federal Home Loan Mortgage Corporation (FHLMC), a U.S. sponsored corporation.

Ginnie Mae. Trade name for the Government National Mortgage Association (GNMA), a direct obligation bearing the full faith and credit of the U.S. Government.

Government Accounting Standards Board (GASB). A standard-setting body, associated with the Financial Accounting Foundation, which prescribes standard accounting practices for governmental units.

Guaranteed Investment Contracts (GICS). An agreement acknowledging receipt of funds, for deposit, specifying terms for withdrawal, and guaranteeing a rate of interest to be paid.

Inactive Deposits. Funds not immediately needed for disbursement.

Interest Rate. The annual yield earned on an investment, expressed as a percentage.

Investment Agreements. An agreement with a financial institution to borrow public funds subject to certain negotiated terms and conditions concerning collateral, liquidity, and interest rates.

Liquidity. An asset that can easily and rapidly be converted into cash without significant loss of value.

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GLOSSARY OF TERMS

Local Agency Investment Fund (LAIF). A pooled investment vehicle for local agencies in California sponsored by the State of California and administered by the State Treasurer.

Local Agency Investment Pool. A pooled investment vehicle sponsored by a local agency or a group of local agencies for use by other local agencies.

Market Risk. Defined as market value fluctuations due to overall changes in the general level of interest rates.

Market Value. The price at which a security is trading and could presumably be purchased or sold.

Maturity. The date upon which the principal or stated value of an investment becomes due and payable.

Modified Duration. A measure of exposure to market risk of a security or a portfolio. It is the percent change in the price of a security (portfolio) or a 100-basis point change in the security (portfolio) yield.

Mutual Funds. An investment company that pools money and can invest in a variety of securities, including fixed-income securities and money market instruments.

Negotiable Certificate of Deposit. A large denomination certificate of deposit which can be sold in the open market prior to maturity.

New Issue. Term used when a security is originally "brought" to market.

Note. A written promise to pay a specified amount to a certain entity on demand or on a specified date.

Par Value. The amount of principal which must be paid at maturity. Also referred to as the face amount of a bond, normally quoted in S1,000 increments per bond.

Perfected Delivery. Refers to an investment where the actual security or collateral is held by an independent third party representing the purchasing entity.

Portfolio. Combined holding of more than one stock, bond, commodity, real estate investment, cash equivalent, or other asset. The purpose of a portfolio is to reduce risk by diversification.

Primary Dealer. A group of government securities dealers that submit daily reports of market activity and security positions held to the Federal Reserve Bank of New York and are subject to its informal oversight.

Principal. The face value or par value of a debt instrument, or the amount of capital invested in a given security.

Prospectus. A legal document that must be provided to any prospective purchaser of a new securities offering registered with the SEC that typically includes information on the issuer, the issuer's business, the proposed use of proceeds, the experience of the issuer's management, and certain certified financial statements ( also known as an “official statement”)
Prudent Investor Standard. A standard of conduct where a person acts with care, skill, prudence, and diligence when investing, reinvesting, purchasing, acquiring, exchanging, selling and managing funds.

The test of whether the standard is being met is if a prudent person acting in a similar situation would engage in similar conduct to ensure that investments safeguard principal and maintain liquidity.

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GLOSSARY OF TERMS

Purchase Date. The date in which a security is purchased for settlement on that or a later date.

Rate of Return. The yield obtainable on a security based on its purchase price or its current market price.

This may be the amortized yield to maturity on a bond or the current income return.

Repurchase Agreement (REPO). A transaction where the seller agrees to buy back from the buyer (City) the securities at an agreed upon price on demand or at a specified date.

Reverse Repurchase Agreement (REVERSE REPO). A transaction where the seller (City) agrees to buy back from the buyer the securities at an agreed upon price on demand or at a specified date.

Risk. Degree of uncertainty of return on an asset.

Rule G-37 of the Securities Rulemaking Board. Federal regulations to sever any connection between the making of political contributions and the awarding of municipal securities business.

Safekeeping Service. An arrangement under which a third-party institution holds securities or valuables under safe, controlled conditions. A safekeeping arrangement is evidenced by a safekeeping receipt.

Sallie Mae. Trade name for the Student Loan Marketing Association (SLMA), a U.S. sponsored corporation.

Secondary Market. A market made for the purchase and sale of outstanding issues following the initial distribution.

Securities and Exchange Commission (SEC). The federal agency responsible for supervising and regulating the securities industry.

Settlement Date. The date on which a trade is cleared by delivery of securities against funds.

Tax and Revenue Anticipation Notes (TRANS). Notes issued in anticipation of receiving tax proceeds or other revenues at a future date.

Time Certificate of Deposit. A non-negotiable certificate of deposit which cannot be sold prior to maturity.

Treasury Bills. U.S. Treasury Bills which are short-term, direct obligations of the U.S. Government issued with original maturities of 13 weeks, 26 weeks and 52 weeks; sold in minimum amounts of $10,000 in multiples of $5,000 above the minimum. Issued in book entry form only. T-bills are sold on a discount basis.

Trustee or trust company or trust department of a bank. A financial institution with trust powers which acts in a fiduciary capacity for the benefit of the bondholders in enforcing the terms of the bond contract.

Underwriter. A dealer which purchases a new issue of municipal securities for resale.

U.S. Government Agencies. Instruments issued by various US Government Agencies most of which are secured only by the credit worthiness of the respective agency.

U.S. Treasury Obligations. Debt obligations of the United States Government sold by the Treasury Department in the forms of Bills, Notes, and Bonds. Bills are short-term obligations that mature in 1

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GLOSSARY OF TERMS

year or less and are sold based on a rate of discount. Notes are obligations which mature between 1 year and 10 years. Bonds are long-term obligations which generally mature in 10 years or more.

Weighted Average Maturity (WAM). The average maturity of all the securities that comprise a portfolio that is typically expressed in days or years.

Yield. The rate of annual income return on an investment, expressed as a percentage. It is obtained by dividing the current dollar income by the current market price of the security.

Yield to Maturity. The rate of income return on an investment, minus any premium or plus any discount, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond, expressed as a percentage.

Yield Curve. A graphic representation that shows the relationship at a given point in time between yields and maturity for bonds that are identical in every way except maturity.

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CITY OF MILPITAS
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POLICY OVERVIEW

PURPOSE
The purpose of this Investment Policy (Policy) is to establish overall guidelines for the management and investment of the City of Milpitas (City) unexpended funds under authority granted by the City Council.

This Policy is in compliance with the provisions of the California Government Code, Sections 16340, 16429.1- 16429.4, and 53600-53686, the authority governing investments for municipal governments.

INVESTMENT OBJECTIVES
The primary objectives of this Policy, in order of priority, are safety, liquidity, and return:
1)Safety. Safety of principal is the foremost objective of the investment program. Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. This objective shall be accomplished by mitigating credit risk and market risk. 2)Liquidity. The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This objective shall be accomplished by structuring the portfolio so securities mature concurrently with anticipated needs. The investment portfolio shall consist largely of securities with active secondary or resale markets.

Furthermore, a portion of the portfolio may be placed in money market funds or Local Agency Investment Fund (LAIF) which offer same day liquidity for short-term investment. 3)Return. The investment portfolio is designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into consideration the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives described above. The core of investments is limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed. Nevertheless, investment performance shall be continually monitored and evaluated by the City Treasurer by comparison with other investment portfolio benchmarks.

Additionally, investments are to be made that will bear in mind the responsibility of the City government to its citizens. The following investment considerations, which enhance the quality of life, will be adhered to:
•Divestment From Publicly-Traded Fossil Fuel Companies. The City of Milpitas has a responsibility to protect the lives and livelihoods of its inhabitants from the threat of climate change. The City believes its investments should support a future where all residents can live healthy lives without the negative impacts of a warming environment. For the purposes of the Investment Policy, a "fossil fuel company" shall be defined as any of the two hundred publicly- traded companies with the largest coal, oil and gas reserves as measured by the gigatons of carbon dioxide that would be emitted if those reserves were extracted and burned, as listed in the Carbon Tracker Initiative's "Unburnable Carbon" report. Staff responsible for managing the City investment portfolio are directed to divest all City investment funds held in fossil fuel companies once they reach their maturities, and are prohibited from making any new investments in such companies.

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SCOPE
The Policy applies to all financial assets of the City of Milpitas as accounted for in the Annual Comprehensive Financial Report (ACFR), including but not limited to the funds listed below:
•General Fund
•Special Revenue Funds
•Capital Projects Funds
•Debt Service Fund
•Enterprise Funds
•Internal Service Fund
•Trust and Agency Funds
Any new fund created by the City Council unless specifically exempted with the exception of the following:
1) The City Deferred Compensation Plan is excluded as it is managed by a third- party administrator and invested by individual plan participants. 2) Proceeds of debt issuance shall be invested in accordance with the investment objectives of this Policy. However, such proceeds are generally invested in accordance with permitted investment provisions of their specific bond indentures. If the City Treasurer determines that the matching of bond reserve funds with the maturity schedule of an individual bond issue is prudent, the Policy authorizes extending beyond the five-year maturity limitation as outlined in this document.

STANDARDS OF CARE
1)Prudence. Pursuant to California Government Code, Section 53600.3, all persons authorized to make investment decisions on behalf of the City are trustees and therefore fiduciaries subject to the prudent investor standard:
“…all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the Agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the Agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.”
The City Treasurer and other individuals assigned to manage the investment portfolio, acting within the intent and scope of the Policy and other written procedures, and exercising due diligence, shall be relieved of personal responsibility and liability for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely manner and appropriate action is taken to control adverse developments.

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2)Ethics and Conflict of Interest. Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program or could impair their ability to make impartial investment decisions. City employees involved in the investment process shall disclose to the City Manager any material financial interest in financial institutions that conduct business within the jurisdiction. They shall further disclose any large personal financial/investment positions that could affect the performance of the investment portfolio.
3)Delegation of Authority. Authority to manage the investment program is derived from California Government Code, Sections 41006 and 53600 et seq and granted to the City Treasurer by Section VI- 1-3.04 of the City of Milpitas Municipal Code. Under the oversight of the City Treasurer, responsibility for the operation of the investment program may be delegated to the Finance Administration staff, who shall act in accordance with established written procedures and internal controls consistent with the Policy. The City Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of the subordinate staff members. The system of internal controls includes separation of duties, custodial safekeeping, avoidance of physical delivery securities, development of wire transfer agreement, and clear delegation of authority to subordinate staff members. The City may engage the services of one or more external investment advisers, who are registered under the Investment Advisers Act of 1940, to assist in the management of the City investment portfolio in a manner consistent with City objectives. External investment advisers may be granted discretion to purchase and sell investment securities in accordance with this Policy. The City overall investment program shall be designed and managed with a degree of professionalism that is worthy of the public trust. The City recognizes that in a diversified portfolio, occasional measured losses may be inevitable and must be considered within the context of the overall portfolio return and cash flow requirements of the City.

INVESTMENT GUIDELINES

INVESTMENT PARAMETERS
•Maximum Maturities. To the extent possible, the City shall attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow, the City will not directly invest in securities maturing more than five (5) years from the date of trade settlement. The intent to invest in securities beyond the five-year maturity limitation shall be disclosed in writing to the City Council no less than 3 months prior to the investment. Reserve funds established by the issuance of bonds and other funds with longer-term investment horizons may be invested in securities exceeding five years if the maturity of such investments is made to coincide with the expected use of funds.
•Competitive Bidding. It is the practice of the City to require that, where possible, all transactions with broker/dealers shall be selected on a competitive basis and their bid or offering prices shall be recorded. If there is no other readily available competitive offering, best efforts will be made to document quotations for comparable or alternative securities. When purchasing original issue instrumentality securities, no competitive offerings will be required as all dealers in the selling group offer those securities at the same original issue price.

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PERFORMANCE EVALUATION/BENCHMARK
•The investment portfolio shall be designed to attain a market-average rate of return throughout budgetary and economic cycles, considering City risk constraints, the cash flow characteristics of the portfolio, and state and local laws, ordinances or resolutions that restrict investments.

Investment performance is continually monitored and evaluated by the City Treasurer.

Investment performance statistics and activity reports are prepared on a quarterly basis for presentation to the City Manager and City Council within 45 days of the end of the quarter. •The City Treasurer shall select an appropriate, readily available index to use as a market benchmark. The benchmark should be commensurate with the level of market risk of the portfolio, and should serve as a measure of risk, interest income, and fair value appreciation.

Samples of readily available benchmarks include Intercity Exchange/Bank of America/Merrill Lynch 1-3 Year or 1-5 Year Treasury Indices.

SAFEKEEPING OF SECURITIES
•To protect against fraud or embezzlement or losses caused by collapse of an individual securities dealer, all securities owned by the City shall be held in safekeeping by a third-party bank trust department, acting as agent for the City under the teams of a custody agreement or master repurchase agreement. All trades executed by a dealer will settle delivery vs. payment (DVP) through the City safekeeping agent.
•Securities held in custody for the City shall be reviewed and verified quarterly by Finance staff who have not been assigned to the investment function.

INTERNAL CONTROL
The City Treasurer is responsible for establishing and maintaining an internal control structure designed to ensure the assets of the City are protected from loss, theft or misuse. The internal controls structure shall be designed to provide reasonable assurance these objectives are met. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits to be derived and that the valuation of costs and benefits requires estimates and judgments by management.

The internal controls shall address the following points:
•Control of collusion
•Separation of transaction authority from accounting and record keeping •Custodial safekeeping
•Avoidance of physical delivery securities
•Clear delegation of authority to subordinate staff members •Written confirmation of transactions for investments and wire transfers •Development of a wire transfer agreement with the lead bank and third-party custodian

REPORTING
The City Treasurer shall review and render quarterly reports to the City Manager and City Council which shall include:

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

•Investment information, including the par and dollar amount of the investment, the classification of the investment, the percentage of the total portfolio which each type of investment represents, the name of the institution or entity, the rate of interest, the maturity date, the current market value, and the source of the market value.
•Statement that the projected cash flow is adequate to meet expected obligations over the next six months.
•A report of transactions by month.
•The weighted average maturity of the investment portfolio. •The average weighted yield to maturity of the portfolio as compared to the applicable benchmark.
•Statement of compliance with the Policy.

The report is due within 45 days of the end of the quarter. The City Manager may, at his discretion, require this reporting on a monthly basis based upon market conditions.

QUALIFIED BROKER/DEALERS
The City shall transact business with financial institutions and security broker/dealers after careful review of their qualifications and creditworthiness. All dealers who desire to do business with the City shall provide the necessary information (e.g., audited financial statements, proof of state registration, proof of National Association of Securities Dealers certification, etc.) from which the City can determine their creditworthiness, the existence of any pending legal action against the firm or the individual broker, as well as an understanding of the security markets that they service. The City Treasurer shall annually send a copy of the current Policy to all financial institutions and broker/dealers approved to do business with the City. Confirmation of receipt of this Policy shall be considered evidence that the dealer understands the City Investment Policy and intends to sell the City only appropriate investments authorized by this Investment Policy.

In accordance with California Government Code Section 53601.5, any investment authorized pursuant to Section 53601 or 53601.1, not purchased directly from the issuer, shall be purchased either from an institution licensed by the state as a broker-dealer, as defined in Section 25004 of the Corporations Code, or from a member of a federally regulated securities exchange, from a national or state-chartered bank, from a savings association or federal association (as defined by Section 5102 of the Financial Code) or from a brokerage firm designated as a primary dealer by the Federal Reserve bank.

Selection of financial institutions and broker/dealers authorized to engage in transactions will be at the sole discretion of the City, except where the City utilizes an external investment adviser in which case the Agency may rely on the adviser for selection.

COLLATERAL REQUIREMENTS
Collateral is required for investments in non-negotiable certificates of deposit and repurchase agreements. To reduce market risk, the collateral level shall be at least 102% of market value of principal and accrued interest and marked-to-market weekly. Securities acceptable as collateral shall be the direct obligations of or are fully guaranteed as to principal and interest by the United States or any agency of the United States.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

The City shall require any bank or financial institution to comply with the collateralization criteria defined in California Government Code, Section 53651.

AUTHORIZED INVESTMENTS
Investment of City funds is governed by the California Government Code, Sections 16340, 16429.1- 16429.4, and 53600-53686. Within the context of the limitations, the following investments are authorized, as further limited herein. In the event a discrepancy is found between this Policy and the Code, the more restrictive parameters will take precedence. Percentage holding limits and minimum credit quality requirements listed in this section apply at the time the security is purchased.

Any investment currently held at the time the Policy is adopted which does not meet the new Policy guidelines can be held until maturity and shall be exempt from the current Policy. At the time of the investment’s maturity or liquidation, such funds shall be reinvested only as provided in the current Policy.

An appropriate risk level shall be maintained by primarily purchasing securities that are of high quality, liquid, and marketable. The portfolio shall be diversified by security type and institution to avoid incurring unreasonable and avoidable risks regarding specific security types or individual issuers. 1)United States Treasury Bills, Bonds, and Notes or those for which the full faith and credit of the United States are pledged for payment of principal and interest. There is no percentage limitation of the portfolio which can be invested in this category, though a five-year maturity limitation is applicable.
2)Federal Agency Obligations or United States Government-Sponsored Enterprise (GSE) obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or Unites States government sponsored enterprises. There is no percentage limitation of the portfolio which can be invested in this category, although a five-year maturity limitation is applicable. Additionally, no more than 30% of the portfolio may be invested in any single Agency/GSE issuer, and the maximum percent of agency callable securities in the portfolio will be 20%. 3)Banker’s Acceptances. Bills of exchange or time drafts drawn on and accepted by commercial banks, otherwise known as banker's acceptances. Banker’s acceptances must be issued by institutions which have short-term debt obligations rated “A-1” or its equivalent or better by at least one nationally recognized statistical rating organization (NRSRO), or long-term debt obligations which are rated in a rating category of “A” or its equivalent or better by at least one NRSRO. Purchase of banker's acceptances may not exceed 180 days maturity or 40% of the value of the portfolio. Furthermore, no more than 5% of the value of the portfolio may be invested in the banker's acceptances of any one commercial bank. 4)Commercial Paper of the highest letter and number rating as provided by at least one NRSRO, either:
a. Issued by general corporations organized and operating within the United States, having assets in excess of $500,000,000 and having a rating in the rating category of "A" or its equivalent or better rating on debt other than commercial paper as provided by at least one NRSRO, or

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

b. Issued by entities organized within the United States as a special purpose corporation, trust, or limited liability company. The securities must have program-wide credit enhancements including, but not limited to, overcollateralization, letters of credit, or a surety bond. The securities must by rated “A-1” or its equivalent or better by at least one NRSRO.

Purchases of eligible commercial paper may not exceed 270 days maturity nor represent more than 10% of the outstanding paper of the issuing corporation. Purchases of commercial paper may not exceed 25% of the value of the portfolio. No more than 5% of the portfolio may be invested in any single issuer. Under a provision sunsetting on January 1, 2026, no more than 40% of the portfolio may be invested in Commercial Paper if the City investment assets under management are greater than $100,000,000.
5)Negotiable Certificates of Deposit issued by nationally or state-chartered banks, a savings association, or a federal association, a state or federal credit union, or by a federally-licensed or state-licensed branch of a foreign bank. Purchases of negotiable certificates of deposit may not exceed 30% of the value of the portfolio. No more than 5% of the portfolio may be invested in any single issuer. A maturity limitation of five years is applicable. The amount of negotiable certificates of deposit insured up to the FDIC limit does not require any credit ratings. Any amount above the FDIC insured limit must be issued by institutions which have short-term debt obligations rated “A-1” or its equivalent or better by at least one NRSRO, or long-term obligations rated in a rating category of “A” or its equivalent or better by at least one NRSRO. 6)Repurchase Agreements. Repurchase agreements collateralized with securities authorized under in accordance with California Government Code Section 53601(j). There are no limits on the dollar amount or percentage the City may invest. The maturity of the repurchase agreements shall not exceed one year. The market value of the securities used as collateral for the repurchase agreements shall be monitored by the investment staff weekly and shall not be allowed to fall below 102% of the value of the repurchase agreement. A Master Repurchase agreement is required between the City and the dealer for all repurchase agreements transacted. 7)Time Deposits. Time deposits, non-negotiable and collateralized in accordance with the California Government Code, may be purchased through banks or savings and loan associations. A maturity limitation of five years is applicable. 8)Medium-Term Corporate Notes issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States with a maximum maturity of five years may be purchased.

Securities eligible for investment shall be rated in a rating category of "A" or its equivalent better by at least one NRSRO. Purchase of medium-term notes may not exceed 30% of the value of the portfolio and no more than 5% of the value of the portfolio may be invested in notes issued by one corporation.
9)Local Agency Investment Fund (LAIF). a State of California managed investment pool may be used up to the maximum permitted in accordance with California Government Code Section 16429.1.
10)Money Market Funds. Money Market funds invested in U.S. Government securities are permitted under this Policy and under the California Government Code Section 53601. To be

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

eligible for investment under this section, an investment objective of such a fund must be the maintenance of a price per share of $1.00. Investment in such funds shall not exceed 20% of the City total portfolio and no more than 10% of the City total portfolio may be invested in any one money market fund. In addition, either one of the following criteria must be met:
a. The fund shall have achieved a rating of "AAA" by at least two nationally recognized statistical rating organizations, or
b. The fund shall have retained an advisor who is registered or exempt from registration with the Security Exchange Commission with not less than five years' experience managing money market funds with assets under management in excess of five hundred million dollars ($500,000,000).
11)Municipal Securities including obligations of the City, the State of California, and any local agency within the State of California, provided that:
a. The securities are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
b. No more than 5% of the portfolio may be invested in any single issuer. c. No more than 30% of the portfolio may be in Municipal Securities. d. The maximum maturity does not exceed five (5) years. 12)Municipal Securities (Registered Treasury Notes or Bonds) of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue- producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California., provided that:
a. The securities are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
b. No more than 5% of the portfolio may be invested in any single issuer. c. No more than 30% of the portfolio may be in Municipal Securities. d. The maximum maturity does not exceed five (5) years. 13)Asset-Backed, Mortgage-backed, Mortgage Passthrough Securities, and Collateralized Mortgage Obligations From Issuers Not Defined In Sections 1 And 2 of the Authorized Investments Section of this Policy, provided that:
a. The securities are rated in a rating category of “AA” or its equivalent or better by a NRSRO.
b. No more than 20% of the total portfolio may be invested in these securities. c. No more than 5% of the portfolio may be invested in any single Asset-Backed or Commercial Mortgage security issuer.
d. The maximum legal final maturity does not exceed five (5) years.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

14)Collateralized Bank Deposits. City deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651. There are no limits on the dollar amount or percentage that the City may invest in collateralized bank deposits. 15)Supranational Securities. Provided that issues are US dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank. The securities must be rated in a rating category of “AA” or its equivalent or better by a NRSRO. No more than 30% of the total portfolio may be invested in these securities. No more than 10% of the portfolio may be invested in any single issuer. The maximum maturity does not exceed five (5) years.
16) Local Government Investment Pools (LGIP) which are shares of beneficial interest issued by a joint powers authority organized pursuant to Section 6509.7 that invests in securities and obligations authorized in California Government Code 53601 subdivisions (a) to (r), inclusive, where each share shall represent an equal proportional interest in the underlying pool of securities owned by the joint powers authority.
a. The joint powers authority issuing the shares must retain an investment adviser who is registered or exempt from registration with the Securities and Exchange Commission (SEC), has assets under management in excess of $500 million, and has at least five years of experience investing in the securities and obligations authorized by Section 53601, subdivisions (a) to (q).
b. Ratings of a LGIP must be in a rating category of “AAA” or its equivalent by at least one NRSRO. If rated by more than one organization, no rating may be lower than the category described in the preceding sentence.
c. No more than 10% of the portfolio shall be invested in any single LGIP. d. LGIP investments may not exceed 20% of the City portfolio in the aggregate.

INELIGIBLE INVESTMENTS AND INVESTMENT PRACTICES
Ineligible investments are those that are not described herein, including but not limited to, common stocks, reverse repurchase agreements, inverse floaters, range notes, mortgage derived interest only strips, derivatives securities, or any security that could result in zero interest accrual. Under a provision sunsetting on January 1, 2026, securities backed by the U.S. Government that could result in a zero- or negative-interest accrual if held to maturity are permitted. Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited. Purchasing or selling securities on margin is prohibited. The use of reverse repurchase agreements, securities lending or any other form of borrowing or leverage is prohibited. The purchase of foreign currency denominated securities is prohibited. The purchase of securities with a forward settlement date exceeding 45 days from the time of the investment is prohibited.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

RISK MANAGEMENT AND DIVERSIFICATION
Mitigating Credit Risk in the Portfolio. Credit risk is the risk a security or a portfolio will lose some or all its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:
•The diversification requirements included in the “Authorized Investments” section of this Policy are designed to mitigate credit risk in the portfolio.
•No more than 5% of the total portfolio may be deposited with or invested in securities issued by any single issuer unless otherwise specified in this Policy. •The City may elect to sell a security prior to its maturity and record a capital gain or loss to manage the quality, liquidity, or yield of the portfolio in response to market conditions or City risk preferences.
•If a security owned by the City is downgraded to a level below the requirements of this Policy, making the security ineligible for additional purchases, the following steps will be taken:
oAny actions taken related to the downgrade by the investment manager will be communicated to the City Treasurer in a timely manner.
oIf a decision is made to retain the security, the credit situation will be monitored and reported to the City Council in the Quarterly Investment Report.

Mitigating Market Risk in the Portfolio. Market risk is the risk the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. On the other hand, longer-term portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short- term cash needs, and by making longer-term investments only with funds that are not needed for current cash flow purposes.

The City further recognizes certain types of securities, including variable rate securities, securities with principal paydowns prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk:
•The City will maintain a minimum of six months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements. •The maximum stated final maturity of individual securities in the portfolio will be five (5) years, except as otherwise stated in this Policy.
•The duration of the portfolio will generally be approximately equal to the duration (typically, plus or minus 20%) of a market benchmark as described in the Performance Evaluation/Benchmark section of this Policy, an index selected by the City based on the City investment objectives, constraints, and risk tolerances.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

INVESTMENT POOLS/MUTUAL FUNDS
The City shall conduct a thorough investigation of any pool or mutual fund prior to making an investment, and on a continual basis thereafter. The Treasurer shall develop a questionnaire which will answer the following general questions:
a. A description of eligible investment securities, and a written statement of Policy and objectives. b. A description of interest calculations and how it is distributed, and how gains and losses are treated.
c. A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited. d. A description of who may invest in the program, how often, what size deposit and withdrawal are allowed.
e. A schedule for receiving statements and portfolio listings. f. Are reserves, retained earnings, etc. utilized by the pool/fund? g. A fee schedule, and when and how is it assessed.
h. Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds?

INTEREST EARNINGS
All moneys earned and collected from investments authorized in this Policy shall be allocated monthly to various fund accounts based on the cash balance in each fund as a percentage of the entire pooled portfolio.

ANNUAL POLICY APPROVAL
The City Investment Policy shall be adopted by resolution of the City Council on an annual basis. This Policy shall be reviewed at least annually to ensure its consistency with the overall objectives of safety of principal, liquidity and yield, and its relevance to current law and financial and economic trends. Any amendments to the Policy shall be forwarded to City Council for approval.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

GLOSSARY OF TERMS

Accrued Interest. Interest earned but not yet received.

Active Deposits. Funds which are immediately required for disbursement.

Amortization. An accounting practice of gradually decreasing (increasing) an asset's book value by spreading its depreciation (accretion) over a period of time.

Arbitrage. Transactions by which securities are bought and sold in different markets at the same time for the sake of the profit arising from a yield difference in the two markets.

Asked Price. The price a broker dealer offers to sell securities.

Banker's Acceptance. A high-quality, short-term money market instrument used to finance international trade. There has never been an instance of a failure to pay a banker's acceptance in full at its maturity date.

Basis Point. One basis point is one hundredth of one percent (.01).

Bid Price. The price a broker dealer offers to purchase securities.

Bond. A financial obligation for which the issuer promises to pay the bondholder a specified stream of future cash flows, including periodic interest payments and a principal repayment.

Book Value. The value at which a debt security is shown on the holder's balance sheet. Book value is acquisition cost less amortization of premium or accretion of discount.

Broker. Someone who brings buyers and sellers together and is compensated for his/her service.

Certificate of Deposit. A deposit insured by the FDIC at a set rate for a specified period of time.

Collateral. Securities, evidence of deposit or pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposit of public moneys.

Commercial Paper. Short-term, negotiable unsecured promissory notes of corporations.

Annual Comprehensive Financial Report (ACFR). The official annual financial report for the City, prepared in conformity with Generally Accepted Accounting Principles (GAAP).

Coupon. The annual rate of interest that a bond issuer promises to pay the bondholder on the bond's face value.

Credit Risk. Defined as the risk of loss due to failure of the issuer of a security.

Current Yield. The interest paid on an investment expressed as a percentage of the current price of the security.

Custodian. A bank or other financial institution that keeps custody of stock certificates and other assets.

Defeased Bond Issues. Issues that have sufficient money to retire outstanding debt when due so that the agency is released from the contracts and covenants in the bond document.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

GLOSSARY OF TERMS

Delivery vs. Payment (DVP). Delivery of securities with a simultaneous exchange of money for the securities.

Derivative. Securities that are based on, or derived from, some underlying asset, reference date, or index.

Discount. The difference between the cost of a security and its value at maturity when quoted at lower than face value.

Diversification. Dividing investment funds among a variety of securities offering independent returns and risk profiles.

Duration. A measure of the timing of the cash flows, such as the interest payments and the principal repayment, to be received from a given fixed-income security. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity. The duration of a security is a useful indicator of its price volatility for given changes in interest rates.

Fannie Mae. Trade name for the Federal National Mortgage Association (FNMA), a U.S. sponsored corporation.

Federal Reserve System. The central bank of the U.S. which consists of a seven member Board of Governors, 12 regional banks and 5,700 commercial banks that are members.

Federal Deposit Insurance Corporation (FDIC). Insurance provided to customers of a subscribing bank which guarantees deposits to a set limit (currently $250,000) per account.

Fed Wire. A wire transmission service established by the Federal Reserve Bank to facilitate the transfer of funds through debits and credits of funds between participants within the Fed system.

Freddie Mac. Trade name for the Federal Home Loan Mortgage Corporation (FHLMC), a U.S. sponsored corporation.

Ginnie Mae. Trade name for the Government National Mortgage Association (GNMA), a direct obligation bearing the full faith and credit of the U.S. Government.

Government Accounting Standards Board (GASB). A standard-setting body, associated with the Financial Accounting Foundation, which prescribes standard accounting practices for governmental units.

Guaranteed Investment Contracts (GICS). An agreement acknowledging receipt of funds, for deposit, specifying terms for withdrawal, and guaranteeing a rate of interest to be paid.

Inactive Deposits. Funds not immediately needed for disbursement.

Interest Rate. The annual yield earned on an investment, expressed as a percentage.

Investment Agreements. An agreement with a financial institution to borrow public funds subject to certain negotiated terms and conditions concerning collateral, liquidity, and interest rates.

Liquidity. An asset that can easily and rapidly be converted into cash without significant loss of value.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

GLOSSARY OF TERMS

Local Agency Investment Fund (LAIF). A pooled investment vehicle for local agencies in California sponsored by the State of California and administered by the State Treasurer.

Local Agency Investment Pool. A pooled investment vehicle sponsored by a local agency or a group of local agencies for use by other local agencies.

Market Risk. Defined as market value fluctuations due to overall changes in the general level of interest rates.

Market Value. The price at which a security is trading and could presumably be purchased or sold.

Maturity. The date upon which the principal or stated value of an investment becomes due and payable.

Modified Duration. A measure of exposure to market risk of a security or a portfolio. It is the percent change in the price of a security (portfolio) or a 100-basis point change in the security (portfolio) yield.

Mutual Funds. An investment company that pools money and can invest in a variety of securities, including fixed-income securities and money market instruments.

Negotiable Certificate of Deposit. A large denomination certificate of deposit which can be sold in the open market prior to maturity.

New Issue. Term used when a security is originally "brought" to market.

Note. A written promise to pay a specified amount to a certain entity on demand or on a specified date.

Par Value. The amount of principal which must be paid at maturity. Also referred to as the face amount of a bond, normally quoted in S1,000 increments per bond.

Perfected Delivery. Refers to an investment where the actual security or collateral is held by an independent third party representing the purchasing entity.

Portfolio. Combined holding of more than one stock, bond, commodity, real estate investment, cash equivalent, or other asset. The purpose of a portfolio is to reduce risk by diversification.

Primary Dealer. A group of government securities dealers that submit daily reports of market activity and security positions held to the Federal Reserve Bank of New York and are subject to its informal oversight.

Principal. The face value or par value of a debt instrument, or the amount of capital invested in a given security.

Prospectus. A legal document that must be provided to any prospective purchaser of a new securities offering registered with the SEC that typically includes information on the issuer, the issuer's business, the proposed use of proceeds, the experience of the issuer's management, and certain certified financial statements ( also known as an “official statement”)
Prudent Investor Standard. A standard of conduct where a person acts with care, skill, prudence, and diligence when investing, reinvesting, purchasing, acquiring, exchanging, selling and managing funds.

The test of whether the standard is being met is if a prudent person acting in a similar situation would engage in similar conduct to ensure that investments safeguard principal and maintain liquidity.

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

GLOSSARY OF TERMS

Purchase Date. The date in which a security is purchased for settlement on that or a later date.

Rate of Return. The yield obtainable on a security based on its purchase price or its current market price.

This may be the amortized yield to maturity on a bond or the current income return.

Repurchase Agreement (REPO). A transaction where the seller agrees to buy back from the buyer (City) the securities at an agreed upon price on demand or at a specified date.

Reverse Repurchase Agreement (REVERSE REPO). A transaction where the seller (City) agrees to buy back from the buyer the securities at an agreed upon price on demand or at a specified date.

Risk. Degree of uncertainty of return on an asset.

Rule G-37 of the Securities Rulemaking Board. Federal regulations to sever any connection between the making of political contributions and the awarding of municipal securities business.

Safekeeping Service. An arrangement under which a third-party institution holds securities or valuables under safe, controlled conditions. A safekeeping arrangement is evidenced by a safekeeping receipt.

Sallie Mae. Trade name for the Student Loan Marketing Association (SLMA), a U.S. sponsored corporation.

Secondary Market. A market made for the purchase and sale of outstanding issues following the initial distribution.

Securities and Exchange Commission (SEC). The federal agency responsible for supervising and regulating the securities industry.

Settlement Date. The date on which a trade is cleared by delivery of securities against funds.

Tax and Revenue Anticipation Notes (TRANS). Notes issued in anticipation of receiving tax proceeds or other revenues at a future date.

Time Certificate of Deposit. A non-negotiable certificate of deposit which cannot be sold prior to maturity.

Treasury Bills. U.S. Treasury Bills which are short-term, direct obligations of the U.S. Government issued with original maturities of 13 weeks, 26 weeks and 52 weeks; sold in minimum amounts of $10,000 in multiples of $5,000 above the minimum. Issued in book entry form only. T-bills are sold on a discount basis.

Trustee or trust company or trust department of a bank. A financial institution with trust powers which acts in a fiduciary capacity for the benefit of the bondholders in enforcing the terms of the bond contract.

Underwriter. A dealer which purchases a new issue of municipal securities for resale.

U.S. Government Agencies. Instruments issued by various US Government Agencies most of which are secured only by the credit worthiness of the respective agency.

U.S. Treasury Obligations. Debt obligations of the United States Government sold by the Treasury Department in the forms of Bills, Notes, and Bonds. Bills are short-term obligations that mature in 1

EXHIBIT A

CITY OF MILPITAS
INVESTMENT POLICY-FISCAL YEAR 2024-25

GLOSSARY OF TERMS

year or less and are sold based on a rate of discount. Notes are obligations which mature between 1 year and 10 years. Bonds are long-term obligations which generally mature in 10 years or more.

Weighted Average Maturity (WAM). The average maturity of all the securities that comprise a portfolio that is typically expressed in days or years.

Yield. The rate of annual income return on an investment, expressed as a percentage. It is obtained by dividing the current dollar income by the current market price of the security.

Yield to Maturity. The rate of income return on an investment, minus any premium or plus any discount, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond, expressed as a percentage.

Yield Curve. A graphic representation that shows the relationship at a given point in time between yields and maturity for bonds that are identical in every way except maturity.

RESOLUTION NO. _____________

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MILPITAS APPROVING THE INVESTMENT POLICY FOR FISCAL YEAR 2024-25
WHEREAS, the Legislature of the State of California has declared that the deposit and investment of public funds by local officials and local agencies is an issue of statewide concern; and
WHEREAS, the legislative body of a local agency may invest surplus monies not required for the immediate needs of the local agency in accordance with the provisions of California Government Code Sections 16340, 16429.1-16429.4 and 53601 et seq.; and WHEREAS, the Treasurer of the local agency shall annually prepare and submit a statement of investment policy and such policy, and any changes thereto, shall be considered by the legislative body at a public meeting; and
WHEREAS, the Investment Policy was last reviewed and approved by the City Council pursuant to Resolution No. 9267 on August 15, 2023.

NOW, THEREFORE, the City Council of the City of Milpitas hereby finds, determines, and resolves as follows:

1. The City Council has considered the full record before it, which may include but is not limited to such things as the staff report, testimony by staff and the public, and other materials and evidence submitted or provided to it. Furthermore, the recitals set forth above are found to be true and correct and are incorporated herein by reference.

2. The City Council has reviewed and considered the Investment Policy, including any changes, attached hereto as Exhibit A, and the Investment Policy for Fiscal Year 2024- 25 is hereby approved.

PASSED AND ADOPTED this ___ day of ___________, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

ATTEST: APPROVED:

Suzanne Guzzetta, City Clerk Carmen Montano, Mayor
APPROVED AS TO FORM:

Michael Mutalipassi, City Attorney

CITY OF MILPITAS

AGENDA REPORT
(AR)
Item Title: Authorize the City Manager to Execute an Agreement with Staples Contract & Commercial LLC for Office Supplies (Staff Contact: Luz Cofresí-Howe, Finance Director, 408-586-3111)
Category: Consent Calendar-Leadership and Support Services Meeting Date: 9/3/2024
Recommendation: Authorize the City Manager to execute an agreement with Staples Contract & Commercial LLC for Office Supplies through a Sourcewell Cooperative Procurement Agreement for a not-to-exceed amount of $725,000 for 60 months (5 years).

BACKGROUND:

The City of Milpitas (City) requires office supplies for use by all City departments. The City is currently under contract with Staples Contract & Commercial LLC. The contract is based on a national solicitation by Sourcewell, under the Office Supply Catalog Solutions, cooperative purchasing program. The current contract with Staples Contract & Commercial LLC expires on October 31, 2024.

City of Milpitas Municipal Code §1-2-3.08 Cooperative Procurement specifically authorizes the Purchasing Agent to make such purchases based on an agreement or cooperative purchasing program entered into by a public agency, as defined by Government Code Section 6500, regardless of whether the City is a named party to the agreement or an actual participant in such a program, provided that the underlying purchase was made using competitive negotiation or bidding procedures at least as restrictive as the City's, and that the supplies or general services purchased must be the same and be offered at the same price as the supplies and general services subject to the agreement or program.

Sourcewell is a municipal contracting agency that operates as a public entity under legislative authority through Minnesota Statute 123A.21.Feb 24, 2017, which meets the definition of a public agency as defined by Government Code section 6500. Sourcewell was established with the statutory purpose to assist its members in meeting specific needs which are more effectively delivered cooperatively than by an individual entity.

Sourcewell cooperative purchasing contracts are made available to its members through the Minnesota joint exercise of powers law. Sourcewell members outside of Minnesota may use its cooperative contracts under authority of joint powers or intergovernmental cooperation laws.

The City of Milpitas became a participating Sourcewell member on January 11, 2008. On December 5, 2019, Sourcewell solicited on behalf of its current and potential member agencies, Request for Proposal (RFP) No. 012320 for "Office Supply Catalog Solutions." On August 1, 2020, Sourcewell awarded Contract No. 012320 to Staples Contract & Commercial LLC. The contract period runs from August 1, 2020 to April 6, 2024. On December 6, 2022, the contract was extended to April 6, 2025.

Although Staples' current agreement with Sourcewell will expire April 6, 2025, Staples will honor all terms and conditions of the subject Sourcewell Program Agreement with the City of Milpitas beyond the expiration date, per section 2.0, Term, of the Sourcewell Program Agreement.

ANALYSIS:

The Purchasing Agent reviewed all the documentation from Sourcewell regarding the RFP and Contract No. 012320 and has determined the underlying purchase was made using competitive bidding procedures at least as restrictive as the City's, and the price for the supplies is the same as offered in the original contract.

POLICY ALTERNATIVE(S):

Alternative 1: Do not approve the Staples contract.

Pros: None
Cons: The current Milpitas contract with Staples will expire on October 31, 2024; the City will then be without a contract for office supplies and forced to purchase in the open market. Without the benefit of a competitively bid national contract, the terms, conditions, and pricing of office supplies could vary widely.

Reason for Not Recommending: See Cons.

FISCAL IMPACT:

The estimated cost for the FY 2024-25 contract period is $145,000 which will be paid through City Departmental operating budgets as supplies are purchased. Future contract years will be subject to appropriation through the City’s annual operating budget process.

California Environmental Quality Act (CEQA):

By the definition provided in the California Environmental Quality Act (CEQA) Guidelines Section 15378, this action does not qualify as a "project" for the purpose of CEQA.

RECOMMENDATION:

Authorize the City Manager to Execute an Agreement with Staples Contract & Commercial LLC for Office Supplies through a Sourcewell Cooperative Procurement Agreement for 60 months (5 years) in a not-to-exceed amount of $725,000
Attachment(s):

1. Staples-Sourcewell Contract

CITY OF MILPITAS

COOPERATIVELY PURCHASED AGREEMENT FOR CITYWIDE OFFICE SUPPLIES

This Cooperatively Purchased Agreement for Citywide Office Supplies (“Agreement”) is entered into as of the day of by and between the City of Milpitas, a municipal corporation organized under the laws of the State of California with its principal place of business at 455 E. Calaveras Boulevard, Milpitas, California 95035 (“City”) and Staples Contract & Commercial LLC , a Delaware limited liability company with its pri ncipal place of business at 500 Staples Drive, Framingham, MA 01702 (“Contractor”). City and Contractor are sometimes individually referred to as “Party” and collectively as “Parties” in this Agreement

RECITALS

WHEREAS, on August 1, 2020, the Sourcewell Cooperative awarded a contract to Contractor entitled Office Supply Catalog Solutions (“Original Contract”) for Citywide Office Supplies pursuant to a competitive solicitation process performed in accordance with the competitive procurement rules applicable to Sourcewell Cooperative; and

WHEREAS, pursuant to the City’s purchasing ordinance, the City is authorized to utilize cooperative purchasing to utilize contracts based on an agreement or entered into by any public agency or cooperative purchasing program utilizing public agency procurements as the basis for contracts offered, regardless of whether the City is a named party to the agreement or an actual participant in such a program; and

WHEREAS, the Original Contract is listed in the purchasing schedule offered by Sourcewell Cooperative, a National cooperative purchasing program; and

WHEREAS, the City desires to rely on the Original Contract entered into between Sourcewell Cooperative and Contractor and procure Citywide Office Supplies on the same terms and conditions set forth therein pursuant to this Agreement.

NOW, THEREFORE, in co nsideration of their mutual promises, obligations and covenants hereinafter contained, the parties hereto agree as follows:

1. Recitals. The foregoing recitals are true and correct and are a part of this Agreement.

2. Term. The term of this Agreement shall be from November 1, 2024 to October 31, 2029, unless earlier terminated as provided herein. The City reserves the right to review the Contractor’s performance at the end of each year and cancel all or part of the Agreement.

3. Incorporation By Reference . The Scope of Services is attached hereto as Exhibit “A” and incorporated herein by this reference. The Original Contract, including all documents incorporated by reference therein, is attached hereto as Exhibit “B” and incorporated herein by this reference – all references in the Original Contract to “Sourcewell Cooperative” shall be understood to mean the City of Milpitas. The Contractor’s Proposal is attached hereto as Exhibit “C” and is incorporated herein by referenc e. The incorporation of the Original Contract and the Contractor’s Proposal as part of this Agreement is subject to the order of precedence set forth below.

4. Precedence of Agreement Documents . If there is a conflict between Agreement documents, the document highest in precedence shall control. The precedence shall be:

One: This Agreement

Two: The Original Contract
Three: The Contractor’s Proposal

Amendments, supplemental agreements, and approved revisions to the Agreement or any part thereof become a part of item One above.

5. Obligations of the City.

A. The City shall be obligated to pay Contractor based upon the unit and/or lump sum prices set forth in the Original Contract and/or the Contractor’s Proposal for services authorized by the City.

B. Payments to the Contractor shall be made within 30 days after receipt of an original invoice from the Contractor and acceptance of the services by City.

C. In no event shall the total amount paid for this Agreement exceed Seven Hundred Twenty-Five Thousand Dollars and Zero Cents ($725,000.00) unless otherwise agreed to by the parties in writing.

6. Obligations of the Contractor.

A. Contractor shall perform the Scope of Services as required by this Agreement.

B. Contractor shall obey all Federal, State, local, and special district laws, ordinances, and regulations. Contractor is aware of the requirements of California Labor Code Sections 1720 et seq. and 1770 et seq. (“Prevailing Wage Laws”), which require the pay ment of prevailing wage rates and the performance of other requirements on certain "public works" and "maintenance" projects. If the Scope of Services is being performed as part of an applicable "public works" or "maintenance" project, as defined by the Prevailing Wage Laws, and if the total compensation is $1,000 or more, Contractor agrees to fully comply with such Prevailing Wage Laws. Contractor shall defend, indemnify and hold City, its officials, officers, employees and agents free and harmless from an y claims, liabilities, costs, penalties or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws. Any stop orders issued by the Department of Industrial Relations against Contractor or any subcontractor that affect Contractor’s performance of the Scope of Services, including any delay, shall be Contractor’s sole responsibility and Contractor shall indemnify City from liability arising out of the same. It shall be mandatory upon the Contractor and all subcontractors to comply with all applicable California Labor Code provisions, which include but are not limited to prevailing wages (Labor Code Sections 1771, 1774 and 1775), employment of apprentices (Labor Code Section 1777.5), certified payroll records (Labor Code Sections 1771.4 and 1776), hours of labor (Labor Code Sections 1813 and 1815), contractor registration (Labor Code Sections 1725.5 and 1771.1) and debarment of contractors and subcontractors (Labor Code Sections 1777.1). The requirement to submit certified payroll records directly to the Labor Commissioner under Labor Code section 1771.4 and to be registered with the California Department of Industrial Relations shall not apply to work performed on a public works project that is exempt pursuant to the small project exemption specified in Labor Code Sections 1771.4, 1725.5 and 1771.1.

C. The Contractor shall keep a tally of the cost for the services ordered by City. The Contractor shall not accept work orders from the City if the cost for the work will exceed the amount indicated above unless otherwise agreed to by the parties in writing.

7. Audit. City shall have the option of inspecting and/or auditing all records and other written materials used by Contractor in preparing its statements to City as a condition precedent to any payment to Contractor.

8. Hold Harmless and Indemnification. To the fullest extent permitted by law, Contractor shall defend, indemnify and hold the City, its officials, officers, employees, volunteers and agents free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury of any kind, in law or equity, to property or persons, including wrongful death, in any manner arising out of, pertaining to, or incident to any alleged acts, errors or omissions of Contractor, its officials, officers, employees, subcontractors, consultants or agents in connection with the performance of the Contractor’s services or 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, to the extent Contractor's Services are subject to Civil Code Section 2782.8, the above inde mnity 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 Contractor.

9. Amendments. Any amendment, modification, or variation from the terms of this Agreement shall be in writing and shall be effective only upon mutual written approval by the City and Contractor.

10. Anti-Discrimination. In the performance of the terms of this Agreement, Contractor shall not engage in, nor permit subcontractors to engage in, discrimination in employment of persons because of the age, race, color, religious creed, sex, sexual orientation, national origin, ancestry, physical disability, mental disability, medical condition, or marital status of such persons.

11. Termination. City may, by written notice to Contractor, terminate the whole or any part of this Agreement at any time and without cause by giving written notice to Contractor of such termination, and specifying the effective date thereof, at least seven (7) days before the effective date of such termination.

Upon termination, Contractor shall be compensated only for those services which have been adequately rendered to City, and Contractor shall be entitled to no further compensation. Contractor may not terminate this Agreement except for cause. If this Agreement is terminated as provided herein, City may require Contractor to provide all finished or unfinished documents and data and ot her information of any kind prepared by Contractor in connection with the performance of services under this Agreement. Contractor shall be required to provide such documents and other information within fifteen (15) days of the request.

The Contractor understands and accepts that at all times; the Agreement is subject to appropriation of funds by the Milpitas City Council. The Agreement may terminate without penalty, liability or expense of any kind to the City at the end of any fiscal year if funds are not appropriated for the next succeeding fiscal year.

If funds are appropriated for a portion of the fiscal year, the Agreement will terminate, without penalty, liability or expense of any kind at the end of the term for which funds are appropriated. T he City has no obligation to make appropriations for the Agreement in lieu of appropriations for new or other agreements.

City budget decisions are subject to the discretion of the Mayor and City Council. Contractor’s assumption of risk of possible non-appropriation is a part of the consideration for the Agreement. This section controls against any and all other provisions of the Agreement

12. Complete Contract. This Agreement shall constitute the complete Agreement between the parties hereto. No verbal agreement, understanding, or representation not reduced to writing and specifically incorporated herein shall be of any force or effect, nor shall any such verbal agreement, understanding, or representation be binding upon the parties hereto.

13. Time of Performance. Time is of the essence in this Agreement.

14. Successors and Assigns. The terms hereof shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto; provided, however, that no party hereto shall assign any of the benefits and burdens hereunder, whether voluntarily or by operation of law, without the prior written consent of the other party, and any such assignment without said consent shall be void.

15. Authority to Execute Contract . Both City and Contractor do covenant that each individual executing this Agreement on behalf of each party is a person duly authorized and empowered to execute contracts for such party.

16. Insurance. Contractor shall not commence work for the City until it has provided evidence satisfactory to the City it has secured all insurance required under Exhibit “D” (Insurance Requirements), attached hereto and incorporated herein by this reference. In addition, Contractor shall not allow any subcontractor to commence work on any subcontract until it has secured all insurance required therein.

17. Jurisdiction and Venue. Jurisdiction is in the State of California and venue lies in Santa Clara County.

18. Wage Theft Prevention. Contractor, and any subcontractor it employs to complete work under this Agreement, shall comply with all applicable federal, state and local wage and hour laws.

Applicable laws may include, but are not limited to, the Federal Fair Labor Standards Act, the California Labor Code and the Milpitas Minimum Wage Ordinance. BY SIGNING THIS AGREEMENT,

CONTRACTOR AFFIRMS THAT IT HAS DISCLOSED ANY FINAL JUDGMENTS, DECISIONS OR

ORDERS FROM A COURT OR INVESTIGATORY GOVERNMENT AGENCY, FINDING IN THE FIVE (5) YEARS PRIOR TO EXECUTING THIS AGREEMENT THAT CONTRACTOR OR ITS SUBCONTRACTORS HAS VIOLATED ANY APPLICABLE WAGE AND HOUR LAWS.

CONTRACTOR FURTHER AFFIRMS THAT IT OR ITS SUBCONTRACTOR(S) HAS EITHER

FULLY SATISFIED EACH JUDGMENT, DECISION OR ORDER, OR, IF ANY JUDGMENT,

DECISION OR ORDER HAS NOT BEEN FUL LY SATISFIED, CONTRACTOR AFFIRMS THAT IT

OR ITS SUBCONTRACTOR(S) IS CURRENTLY SATISFYING SAID JUDGMENT, DECISION OR

ORDER THROUGH A PAYMENT OR ALTERNATIVE PLAN APPROVED BY THE APPLICABLE

COURT/GOVERNMENT AGENCY AND THAT CONTRACTOR OR ITS SUBCONTRACTOR(S) ARE IN COMPLIANCE WITH SAID PLAN AS OF THE DATE OF EXECUTING THIS AGREEMENT.

If at any time during the term of this Agreement, a court or investigatory government agency issues a final judgment, decision or order finding that Contractor or a subcontractor it employs to perform work under this Agreement has violated any applicable wage and hour law, or Contractor learns of such a judgment, decision, or order that was not previously disclosed in its bid/proposal, Contractor shall inform the City no more than fifteen (15) calendar days after the judgment, decision or order becomes final or from the date of learning of the final judgment, decision or order. Contractor or its subcontractor(s) shall, within thirty (30) calendar days after notifying the City, either (i) fully satisfy any such judgment, decision, or order and provide the City with documentary evidence of satisfying said judgment, decision or order; or (ii) provide the City documentary evidence of a payment or other alternative plan approved by the court/government agency to satisfy the judgment, decision or order. If the Contractor or its subcontractor is subject to a payment or other alternative plan, the Contractor or its subcontractor shall continue to submit documentary evidence every thirty (30) calendar days during the term of the Agreement demonstrating continued compliance with the plan until the judgment, decision or order has been fully satisfied. For purposes of this Section, a "final judgment, decision, or order" refers to one for which all appeals have been exhausted or the time period to appeal has expired. Relevant investigatory government agencies include: the United States Department of Labor, the California Division of Labor Standards Enforcement, the City, or any other governmental entity or division tasked with the investigation and enforcement of wage and hour laws. Failure to comply with any part of this Section constitutes a material breach of this Agreement. Such breach may serve as a basis for immediate termination of this Agreement and/or any other remedies available under this Agreement and/or law. Notice provided to the City shall be addressed to: Attention: Finance Director, 455 E. Calaveras Blvd. Milpitas, CA 95035. The Notice provisions of this Section are separate from any other notice provisions in this Agreement and, accordingly, only notice provided to the above address satisfies the notice requirements in this Section.

19. Notices. All notices permitted or required under this Agreement shall be given to the respective parties at the following address, or at such other address as the respective parties may provide in writing for this purpose:

Contractor:

Staples Contract & Commercial LLC
500 Staples Drive
Framingham, MA 01702
Attn: Diana Pesantez, Sr. Account Manager

City:

City of Milpitas
455 E. Calaveras Boulevard
Milpitas, California 95035
Attn: Ria Abellera

Such notice shall be deemed made when personally delivered or when mailed, forty-eight (48) hours after deposit in the U.S. Mail, first class postage prepaid and addressed to the party at its applicable address.

Actual notice shall be deemed adequate notice on the date actual notice occurred, regardless of the method of service.

[SIGNATURES ON NEXT PAGE]

SIGNATURE PAGE FOR AGREEMENT FOR CITYWIDE OFFICE SUPPLIES

BETWEEN THE CITY OF MILPITAS

AND STAPLES CONTRACT & COMMERCIAL LLC

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.

CITY OF MILPITAS
Approved By:

STAPLES CONTRACT & COMMERCIAL
LLC

Ned Thomas, City Manager Signature

Date

Approved As To Form:

Name

Title

Michael Mutalipassi, City Attorney
Date

Approved:

Luz Cofresí -Howe
Finance Director/Risk Manager

EXHIBIT “A”

SCOPE OF SERVICES

Contractor will provide:

Easy online ordering - a customized site just for you, with special pricing on the products used most by your organization.

Fast and FREE shipping on supplies - next-business-day in most of the country.

[Customized Pricing List on Following Page]

Customized Pricing List Only

SKU_NUMBER ITEM_DESCRIPTION CUST_ITEM_NUMBER CONT_PRICE UOM_CONV SELL_UOM 658923 PILOT PRECISE RT RB 658923 $17.27 1 DZ
620014 SPLS 8.5X11 100% RE 324971 $57.11 1 CT
272153 EXPO ERASER EA 272153 $2.01 1 EA
620014 SPLS 8.5X11 100% RE 234062 $57.11 1 CT
100688 KCUP SBUX PIKE PLAC 100688 $22.99 1 BX
563125 BOX STOR-ALL LETTE 563125 $78.89 1 CT
377022 PM LIQ PAP CORRECT 377022 $2.50 1 EA
1440263 KCUP SBUX BREAKFA 1440263 $19.40 1 BX
268713 ADESSO IMOUSEG2IC 268713 $25.78 1 EA
24448589 U&S MSH/FAB CHAIR 24448589 $91.47 1 EA
620014 SPLS 8.5X11 100% RE 513096 $57.11 1 CT
923273 10 PK FACIAL TISSUE 923273 $15.72 1 PK
514249 PEN GEL RT MED BLA 514249 $14.64 1 DZ
474335 EXPO2 8 COLOR SET 474335 $8.15 1 PK
828116 FILE PKT LTR 5.25 EXP 828116 $27.93 1 BX
962485 BIODEGRADABLE HOT 962485 $3.50 1 PK
24378019 SEB REMAN HP 508A 24378019 $68.99 1 EA
502850 BIC WITE-OUT EXACT 502850 $9.07 1 PK
2518072 KCUP DUNKIN ORIG 22 2518072 $14.60 1 BX
946977 1/2X36 YD MAGIC TAP 946977 $75.68 1 CT
2796207 2019 DESKPAD 22X17 2796207 $3.18 1 EA
815014 LETTER OPENER PLAS 815014 $1.06 1 PK
490948 PASTELS 8.5X11 CANA 490948 $6.61 1 RM
462788 WORKSAVER 5 TAB CL 462788 $0.91 1 ST
686440 ALLI RUBBER BAND SI 686440 $6.14 1 BX
501296 HIGHLIGHTER 4009 CH 501296 $4.26 1 DZ
744907 OVAL PENCIL CUP ME 744907 $11.49 1 EA
520149 SELF-INKING 20ML RE 520149 $3.68 1 EA
357715 6 COMP VERT. FILE BL 357715 $14.39 1 EA
620014 SPLS 8.5X11 100% RE 818051 $57.11 1 CT
712196 SPLS ELECTRONICS D 712196 $2.66 1 EA
374812 2IN WHITE VIEW BINDE 374812 $2.80 1 EA
620014 SPLS 8.5X11 100% RE 135848 $57.11 1 CT
860389 TONER FAX PANA UF5 860389 $176.84 1 EA
24378017 SEB REMAN HP 508A B 24378017 $61.82 1 EA
120741 EXPO DRY ERASE CLE 120741 $2.89 1 EA
620014 SPLS 8.5X11 100% RE 492072 $57.11 1 CT
951059 CLAW STAPLE REMOV 951059 $0.28 1 EA
806630 INKJT CD LBL MATTE 806630 $11.34 1 PK
817196 TAPE DSPR DESK 1 CO 817196 $4.72 1 EA
502582 FOLDER CLASSIFICAT 502582 $55.15 1 BX
408775 CREST CERTIFICATIO 408775 $6.08 1 PK
24378018 SEB REMAN HP 508A C 24378018 $68.99 1 EA
920274 SELF-INK RECEIVED W 920274 $5.56 1 EA
2516934 KCUP DUNKIN MIDNIG 2516934 $14.60 1 BX
45998 PEN 1MM BOLD BLAC 45998 $11.56 1 DZ
163840 STPLS PAD PERF LTR 163840 $8.21 1 DZ
1585355 HP 508A BLACK 1585355 $182.10 1 EA
24418179 TR CLAW STAPLE REM 24418179 $2.16 1 PK
292995 1ST POSITION LEGAL 292995 $21.48 1 BX
328422 ULTRALUX 6 7/8 INCH 328422 $7.52 1 PK
329399 MAGIC GREENER TAPE 329399 $11.56 1 PK
901513 STAPLER LIGHT TOUC 901513 $17.71 1 EA
164208 LYSOL DISFT WIPES L 164208 $13.23 1 PK
683908 GEL MOUSEPAD WRIS 683908 $21.76 1 EA
677045 HOT SPLS LAM POUC 677045 $3.71 1 PK
382955 MOUSE PAD BK 382955 $0.73 1 EA
581761 SPLS 11X17 30% REC 581761 $67.83 1 CT
2072175 HYPE TANK CHISEL AS 2072175 $2.59 1 PK
24323890 CORRECTION TAPE MI 24323890 $2.38 1 PK
24378020 SEB REMAN HP 508A Y 24378020 $68.99 1 EA
176511 2 1/4INX130 ADDING M 176511 $4.07 1 DZ
2093755 DUAL MONITOR DESK 2093755 $86.27 1 EA
620014 SPLS 8.5X11 100% RE 122374 $57.11 1 CT
565448 STICKIES 3X3 POP BRI 565448 $3.16 1 PK
385581 LABEL ADDRESS WHT 385581 $8.66 1 BX
496791 #65 CARDSTOCK 496791 $12.90 1 PK
620014 SPLS 8.5X11 100% RE 620014 $57.11 1 CT

EXHIBIT “B”

ORIGINAL CONTRACT

Attached Behind This Page

38077.00180\34047676.2 C2

_________________
DocuSign Envelope ID: D73AF195-4E91-41A5-B107-B25B59EFEC70

CONTRACT EXTENSION

Contract Number: #012320-SCC

Sourcewell, 202 12th Street Northeast, P.O. Box 219, Staples, MN 56479 (Sourcewell) and Staples Contract & Commercial LLC, 500 Staples Drive, Framingham, MA 01702 have entered into Contract #012320-SCC for the procurement of Office Supply Catalog Solutions. The Contract has an expiration date of April 6, 2024, but the parties may extend the Contract by mutual consent.

Sourcewell and Vendor acknowledge that extending the Contract benefits the Vendor, Sourcewell and Sourcewell’s Members. Vendor and Sourcewell agree to extend the Contract listed above for an additional period, with a new Contract expiration date of April 6, 2025. All other terms and conditions of the Contract remain in full force and effect.

Sourcewell Staples Contract & Commercial LLC

By: By:

Jeremy Schwartz Michele Parzianello
Title: Chief Procurement Officer Title: Chief Sales Officer

12/6/2022 | 3:28 PM CST
Date:

Date:

12/6/2022 | 4:07 PM CST

Rev. 7/2022 1

012320-SCC

Solicitation Number: RFP#012320

CONTRACT

This Contract is between Sourcewell, 202 12th Street Northeast, P.O. Box 219, Staples, MN 56479 (Sourcewell) and Staples Contract & Commercial LLC, 500 Staples Drive, Framingham, MA 01702 (Vendor).

Sourcewell is a State of Minnesota local government agency and service cooperative created under the laws of the State of Minnesota (Minnesota Statutes Section 123A.21) that offers cooperative procurement solutions to its members. Participation is open to all levels of governmental entity, higher education, K-12 education, nonprofit, tribal government, and other public entities located in the United States and Canada.

Vendor desires to contract with Sourcewell to provide equipment, products, or services to Sourcewell and its Members (Members).

1. TERM OF CONTRACT

A. EFFECTIVE DATE. This Contract is effective August 1, 2020.

B. EXPIRATION DATE AND EXTENSION. This Contract expires April 6, 2024, unless it is cancelled sooner pursuant to Article 24. This Contract may be extended up to one additional one-year period upon request of Sourcewell and with written agreement by Vendor.

C. SURVIVAL OF TERMS. Articles 11 through 16 survive the expiration or cancellation of this Contract.

2. EQUIPMENT, PRODUCTS, OR SERVICES

A. EQUIPMENT, PRODUCTS, OR SERVICES. Vendor will provide the Equipment, Products, or Services as stated in its Proposal submitted under the Solicitation Number listed above.

Vendor’s Equipment, Products, or Services Proposal (Proposal) is attached and incorporated into this Contract.

All Equipment and Products provided under this Contract must be new/current model. Vendor may offer close-out or refurbished Equipment or Products if they are clearly indicated in Vendor’s product and pricing list. Unless agreed to by the Member in advance, Equipment or Products must be delivered as operational to the Member’s site.

012320-SCC

This Contract offers an indefinite quantity of sales, and while substantial volume is anticipated, sales and sales volume are not guaranteed.

B. LAWS AND REGULATIONS. All Equipment, Products, or Services must comply fully with applicable federal laws and regulations, and with the laws of the state or province in which the Equipment, Products, or Services are sold.

C. WARRANTY. Vendor warrants that all Products and installation thereof will conform to specifications as stated in manufacturer documentation. Vendor will pass through all manufacturers’ warranties to Member (copies of such manufacturer warranties provided upon request). Vendor warrants that all Products branded TRU RED, Perk, NXT Technologies, Union & Scale, or Coastwide Professional are: (1) merchantable; (2) of good quality and workmanship; (3) free from defects latent or patent in material design and workmanship for whichever period is shorter, either (a) one year from the date of purchase, or (b) as otherwise specified on the packaging of the Products; (4) fit sufficient and safe for their intended purpose and for the particular purpose for which they were designed; and (5) in conformity with Vendor’s samples, if any. Vendor warrants that for a period of one year from performance, installation and assembly Services will meet or exceed generally accepted standards in the industry and will meet any required specifications mutually agreed upon by Vendor and Member.

Additional warranties applicable to specific product categories, if any, are set forth in Vendor’s Proposal.

THESE WARRANTIES ARE EXCLUSIVE AND IN LIEU OF ALL OTHERS, ORAL OR WRITTEN, EXPRESS OR IMPLIED. VENDOR DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING

WITHOUT LIMITATION, WARRANTIES OF TITLE, NON-INFRINGMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

D. DEALERS AND DISTRIBUTORS. Upon Contract execution, Vendor will make available to Sourcewell a means to validate or authenticate Vendor’s authorized Distributors/Dealers relative to the Equipment, Products, and Services related to this Contract. This list may be updated from time-to-time and is incorporated into this Contract by reference. It is the Vendor’s responsibility to ensure Sourcewell receives the most current version of this list.

Vendor may utilize certain company affiliates under the Staples, Inc. umbrella to serve as authorized dealers and distributors under this agreement. Any sales by such affiliates pursuant to the Contract would be reflected in a written agreement between such affiliate and Sourcewell participating Member with reference made to this Contract. These affiliates include, but are not limited to, DEX Imaging, LLC, a leading nationwide managed print services provider.

3. PRICING

012320-SCC

All Equipment, Products, or Services under this Contract will be priced as stated in Vendor’s Proposal.

Regardless of the payment method chosen by the Member, the total cost associated with any purchase option of the Equipment, Products, or Services must always be disclosed in the pricing quote to the applicable Member at the time of purchase.

When providing pricing quotes to Members, all pricing quoted must reflect a Member’s total cost of acquisition. This means that the quoted cost is for delivered Equipment, Products, and Services that are operational for their intended purpose, and includes all costs to the Member’s requested delivery location.

A. SHIPPING AND SHIPPING COSTS. All delivered Equipment and Products must be properly packaged. Damaged Equipment and Products may be rejected. If the damage is not readily apparent at the time of delivery, Vendor must permit the Equipment and Products to be returned within a reasonable time at no cost to Sourcewell or its Members. Members reserve the right to inspect the Equipment and Products at a reasonable time after delivery where circumstances or conditions prevent effective inspection of the Equipment and Products at the time of delivery.

Vendor must arrange for and pay for the return shipment on Equipment and Products that arrive in a defective or inoperable condition.

Sourcewell may declare the Vendor in breach of this Contract if the Vendor intentionally delivers substandard or inferior Equipment or Products. In the event of the delivery of nonconforming Equipment and Products, the Member will notify the Vendor as soon as possible and the Vendor will replace nonconforming Equipment and Products with conforming Equipment and Products that are acceptable to the Member.

Vendor will use commercially reasonable efforts to ship Products ordered by Members before 4:00 p.m. local time within one (1) business day after acceptance of a Purchase Order, except for backordered, special-order, or out of stock Products. If a Product is backordered or shipment is delayed for any reason, Member will be notified of a delay and Vendor will deliver the delayed Product as promptly as commercially practicable. Vendor will treat delayed orders as active until Member contacts Vendor and provides other instructions. Vendor’s standard shipments will be F.O.B. Member’s location in the forty-eight (48) contiguous United States.

Additional charges may apply for desk-top delivery, special delivery, non-standard delivery, rush delivery, or special or custom order products or as noted on Vendor’s e-commerce platform.

Title and risk of loss for the Products will pass to Member at the time the Products are delivered to Member. Eligible products purchased online and picked up at a Vendor retail location will be available for pick up two hours after approval, charged at time of pick up, and cancelled if not picked up after five (5) days. Sales tax will be calculated based upon order pick up location.

Member’s invoice may not separately designate these items as “in-store pick up.” Certain items may incur an additional charge (typically furniture items) which will be invoiced to the Member,

012320-SCC

if applicable. Unless otherwise agreed by Vendor and a Member all orders shall be subject to a minimum order size of 35.00 per order. If an order below this amount is placed, the Member will be informed it cannot be processed.

The following will apply for shipments to Alaska or Hawaii: Shipments up to 159lbs. are shipped UPS 2nd Day Air. Shipments over 159lbs. or items which cannot be shipped via UPS (e.g. items classified as hazmat and/or ORM-D) are shipped ocean freight. Vendor will not ship any fully regulated hazmat items, which are shipped directly from the vendor. Ocean shipments are delivered approximately fourteen (14) days from shipment. All shipments to Alaska or Hawaii will be subject to a 25% surcharge.

B. SALES TAX. Each Member is responsible for supplying the Vendor with valid tax-exemption certification(s). When ordering, Members must indicate if it is a tax-exempt entity.

C. HOT LIST PRICING. At any time during this Contract, Vendor may offer a specific selection of Equipment, Products, or Services at discounts greater than those listed in the Contract.

When Vendor determines it will offer Hot List Pricing, it must be submitted electronically to Sourcewell in a line-item format. Equipment, Products, or Services may be added or removed from the Hot List at any time through a Sourcewell Price and Product Change Form as defined in Article 4 below.

Hot List program and pricing may also be used to discount and liquidate close-out and discontinued Equipment and Products as long as those close-out and discontinued items are clearly identified as such. Current ordering process and administrative fees apply. Hot List Pricing must be published and made available to all Members.

4. PRODUCT AND PRICING CHANGE REQUESTS

Vendor may request Equipment, Product, or Service changes, additions, or deletions at any time. All requests must be made in writing by submitting a signed Sourcewell Price and Product Change Request Form to the assigned Sourcewell Contract Administrator. This form is available from the assigned Sourcewell Contract Administrator. At a minimum, the request must:

• Identify the applicable Sourcewell contract number
• Clearly specify the requested change
• Provide sufficient detail to justify the requested change • Individually list all Equipment, Products, or Services affected by the requested change, along with the requested change (e.g., addition, deletion, price change) • Include a complete restatement of pricing documentation in Microsoft Excel with the effective date of the modified pricing, or product addition or deletion. The new pricing restatement must include all Equipment, Products, and Services offered, even for those items where pricing remains unchanged.

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A fully executed Sourcewell Price and Product Request Form will be become an amendment to this Contract and be incorporated by reference.

Core List. The “Core List” represents net priced items which are inclusive of those products predicted to be the most commonly used products by Sourcewell and its participating Members. Prices for Core List items provided under this contract are set forth in Exhibit 1.

The prices for Core List Items, excluding Premium Products, may be updated biannually on August 1st and February 1st of each year during the term that this contract in effect. Vendor may request a price change adjustment for Core List items by submitting a price change addendum to Sourcewell thirty (30) days prior to August 1st and February 1st to reflect changes in stock availability, market conditions, buying expense, tariffs and other factors that affect the overall cost of such items.

The prices for Premium Products may be updated quarterly of each year during the term that this contract in effect. Premium Products are defined as toner, ink, IT hardware, copy paper and furniture that Members purchase from Vendor.

Extraordinary Market Events. Vendor reserves the right to reasonably adjust a Core Item’s price if extraordinary market events require immediate adjustment (e.g. shortages, trade disputes, natural disasters, etc.) and to adjust pricing with the impact of tariffs, customs, or duties imposed on products. Any such adjustments shall be noticed to Sourcewell with thirty (30) days prior written notice accompanied by supporting documentation. Vendor will work with Sourcewell and affected Members to identify alternative products to mitigate the impact of the foregoing where possible.

Updated Items. For purposes of contract management, Vendor may provide to Sourcewell an updated report no more than once a calendar quarter, which shall identify the SKU numbers and prices for the new items that Vendor and Sourcewell have added, as well as SKU numbers for items that have been removed from the from the Core List. Vendor may from time to time propose substitutions to Core Items. Sourcewell agrees that it will not unreasonably withhold its consent.

Custom Pricing; Rebates & Incentives; Other Terms. Vendor may offer additional pricing discounts, rebates and/or incentives to an individual participating Member based upon commitments and variables that may include, but not limited to, Member size and scope, geography, purchase volume, guarantees, logistical expenses, manufacturer support, specific product usage and other contractual terms/requirements. Members receiving custom pricing or incentives may be required to sign a Participation Agreement with Vendor.

Non-Core Items. The prices for Non-Core Items shall appear on StaplesAdvantage.com and shall be adjusted to reflect changes in stock availability, market conditions, buying expense, and other factors that affect the overall cost of the Non-Core Items. Notwithstanding anything to the contrary Non-Core Items are not subject to customer audit, or any pricing guarantee, nor

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shall Non-Core Items be subject to the Change Request process set forth in this Section 4.

Sourced Goods. Members may request certain goods that are non-stock or custom in nature.

The prices for Sourced Goods shall be those prices that appear on the ordering platform at time of order, or as otherwise established between Vendor and the applicable participating Member at the time the order is placed. Sourced Goods may include additional delivery or handling charges that would be the responsibility of the ordering Member.

Pricing Exhibits. Please see the Pricing Exhibits for pricing details on the following categories:
• Exhibit 1 – Core List Pricing
• Exhibit 2 – Print & Copy Program
• Exhibit 3 – Promotional Products Program
• Exhibit 4 – Staples Technology Solutions
• Exhibit 5A – Managed Print Services Capabilities
• Exhibit 5B – Managed Print Services Pricing
• Exhibit 5C – Managed Print Services Sample Agreement

Tier One Diversity Program. Vendor reserves the right to implement a pricing upcharge when setting up a Tier One program for any Participating Member to reflect the additional cost of the diversity supplier’s program.

5. MEMBERSHIP, CONTRACT ACCESS, AND MEMBER REQUIREMENTS

A. MEMBERSHIP. Membership in Sourcewell is open to public and nonprofit entities across the United States and Canada; such as municipal, state/province, K-12 and higher education, tribal government, and other public entities.

The benefits of this Contract should be available to all Members that can legally access the Equipment, Products, or Services under this Contract. A Member’s authority to access this Contract is determined through its cooperative purchasing, interlocal, or joint powers laws. Any entity accessing benefits of this Contract will be considered a Service Member of Sourcewell during such time of access. Vendor understands that a Member’s use of this Contract is at the Member’s sole convenience and Members reserve the right to obtain like Equipment, Products, or Services from any other source.

Vendor is responsible for familiarizing its sales and service forces with Sourcewell membership requirements and documentation and will encourage potential members to join Sourcewell.

Sourcewell reserves the right to add and remove Members to its roster during the term of this Contract.

Notwithstanding anything to the contrary a Member’s participation hereunder including for the avoidance of doubt and extension of credit hereunder is contingent upon Member’s satisfaction of Vendor’s standard credit requirements. Vendor also reserve the right to refuse sales of Products to Members reselling such Products. To the extent a Member has a pre-

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existing separate agreement with Vendor, Vendor reserves the right not to sell products and services under multiple agreements to that Member. In addition, Vendor may terminate this Contract for any reason (i.e., for convenience) with respect to an individual Member by delivering not less than ninety (90) days prior written notice thereof to Sourcewell and the applicable Member.

B. PUBLIC FACILITIES. Vendor’s employees may be required to perform work at government- owned facilities, including schools. Vendor’s employees and agents must conduct themselves in a professional manner while on the premises, and in accordance with Member policies and procedures, and all applicable laws.

6. MEMBER ORDERING AND PURCHASE ORDERS

A. PURCHASE ORDERS AND PAYMENT. To access the contracted Equipment, Products, or Services under this Contract, Member must clearly indicate to Vendor that it intends to access this Contract; however, order flow and procedure will be developed jointly between Sourcewell and Vendor. Typically a Member will issue a purchase order directly to Vendor. Members may use their own forms for purchase orders, but it should clearly note the applicable Sourcewell contract number. Members will be solely responsible for payment and Sourcewell will have no liability for any unpaid invoice of any Member.

B. ADDITIONAL TERMS AND CONDITIONS. Additional terms and conditions to a purchase order may be negotiated between a Member and Vendor, such as job or industry-specific requirements, legal requirements (such as affirmative action or immigration status requirements), or specific local policy requirements. Any negotiated additional terms and conditions must never be less favorable to the Member than what is contained in Vendor’s Proposal.

C. PERFORMANCE BOND. If requested by a Member, Vendor will provide a performance bond that meets the requirements set forth in the Member’s purchase order.

D. SPECIALIZED SERVICE REQUIREMENTS. In the event that the Member requires service or specialized performance requirements (such as e-commerce specifications, specialized delivery requirements, or other specifications and requirements) not addressed in this Contract, the Member and the Vendor may enter into a separate, standalone agreement, apart from this Contract. Sourcewell, including its agents and employees, will not be made a party to a claim for breach of such agreement.

E. TERMINATION OF PURCHASE ORDERS. Members may terminate a purchase order, in whole or in part, immediately upon notice to Vendor in the event of any of the following events:

1. The Member fails to receive funding or appropriation from its governing body at levels sufficient to pay for the goods to be purchased;

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2. Federal or state laws or regulations prohibit the purchase or change the Member’s requirements; or

3. Vendor commits any material breach of this Contract or the additional terms agreed to between the Vendor and a Member.

Vendor reserves the right to terminate a purchase order pursuant to which a Member requests or demands services to be performed not enumerated by the terms of this Contract.

F. GOVERNING LAW AND VENUE. The governing law and venue for any action related to a Member’s purchase order will be determined by the Member making the purchase.

7. CUSTOMER SERVICE

A. PRIMARY ACCOUNT REPRESENTATIVE. Vendor will assign an Account Representative to Sourcewell for this Contract and must provide prompt notice to Sourcewell if that person is changed. The Account Representative will be responsible for:

• Maintenance and management of this Contract;
• Timely response to all Sourcewell and Member inquiries; and • Business reviews to Sourcewell and Members, if applicable.

B. BUSINESS REVIEWS. Vendor must perform a minimum of one business review with Sourcewell per contract year. The business review will cover sales to members, pricing and contract terms, administrative fees, supply issues, customer issues, and any other necessary information.

8. REPORT ON CONTRACT SALES ACTIVITY AND ADMINISTRATIVE FEE PAYMENT

A. CONTRACT SALES ACTIVITY REPORT. Each calendar quarter, Vendor must provide a contract sales activity report (Report) to the Sourcewell Contract Administrator assigned to this Contract. A Report must be provided regardless of the number or amount of sales during that quarter (i.e., if there are no sales, Vendor must submit a report indicating no sales were made).

The Report must contain the following fields:

• Customer Name (e.g., City of Staples Highway Department); • Customer Physical Street Address;
• Customer City;
• Customer State;
• Customer Zip Code;
• Customer Contact Name;
• Customer Contact Email Address;
• Customer Contact Telephone Number;

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• Sourcewell Assigned Entity/Member Number;
• Item Purchased Description;
• Item Purchased Price;
• Sourcewell Administrative Fee Applied; and
• Date Purchase was invoiced/sale was recognized as revenue by Vendor.

B. ADMINISTRATIVE FEE. In consideration for the support and services provided by Sourcewell, the Vendor will pay an administrative fee to Sourcewell on all Equipment, Products, and Services provided to Members. The Vendor will submit a check payable to Sourcewell for the percentage of administrative fee stated in the Proposal multiplied by the total sales of all Equipment, Products, and Services purchased by Members under this Contract during each calendar quarter. Payments should note the Sourcewell-assigned contract number in the memo and must be mailed to the address above “Attn: Accounts Receivable.” Payments must be received no later than forty-five (45) calendar days after the end of each calendar quarter.

The administrative fee referenced in this Section shall be calculated as a percentage of Net Sales (defined below) as follows:

Unless otherwise mutually agreed to in writing by Sourcewell and Staples, and except as stated below, Staples will pay Sourcewell an administrative fee of one and half percent (1.5%) of the Members’ aggregate Net Sales during each calendar quarter, which have been timely paid, to be paid within forty five (45) days after the end of each calendar quarter.

An exception to the above 1.5% admin fee would be that Staples will pay Sourcewell one half of one percent (0.5%) administrative fee for participating Members’ aggregate Net Sales under the managed print services (“MPS”) program of the Contract and one quarter of one percent (0.25%) on technology product Net Sales.

Net Sales. Net Sales will be defined as the gross sales price of the applicable products sold pursuant to this Contract, less shipping costs (including freight charges and insurance), taxes, duties, any rebates actually paid, discounts and allowances actually taken, rejections and returns to the extent credit is given or paid, and also excluding purchases made via staples.com, or any Staples retail channel.

Vendor agrees to cooperate with Sourcewell in auditing transactions under this Contract to ensure that the administrative fee is paid on all items purchased under this Contract.

In the event the Vendor is delinquent in any undisputed administrative fees, Sourcewell reserves the right to cancel this Contract and reject any proposal submitted by the Vendor in any subsequent solicitation. In the event this Contract is cancelled by either party prior to the Contract’s expiration date, the administrative fee payment will be due no more than thirty (30) days from the cancellation date.

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9. AUTHORIZED REPRESENTATIVE

Sourcewell's Authorized Representative is its Chief Procurement Officer.

Vendor’s Authorized Representative is the person named in the Vendor’s Proposal. If Vendor’s Authorized Representative changes at any time during this Contract, Vendor must promptly notify Sourcewell in writing.

10. ASSIGNMENT, AMENDMENTS, WAIVER, AND CONTRACT COMPLETE

A. ASSIGNMENT. Neither the Vendor nor Sourcewell may assign or transfer any rights or obligations under this Contract without the prior consent of the parties and a fully executed assignment agreement. Such consent will not be unreasonably withheld.

This Section shall not apply to Vendor’s delivery, installation, design, repair, or refurbishment obligations hereunder, which Vendor may subcontract to reasonably qualified third parties.

B. AMENDMENTS. Any amendment to this Contract must be in writing and will not be effective until it has been fully executed by the parties.

C. WAIVER. If either party fails to enforce any provision of this Contract, that failure does not waive the provision or the right to enforce it.

D. CONTRACT COMPLETE. This Contract contains all negotiations and agreements between Sourcewell and Vendor. No other understanding regarding this Contract, whether written or oral, may be used to bind either party.

E. RELATIONSHIP OF THE PARTIES. The relationship of the parties is one of independent contractors, each free to exercise judgment and discretion with regard to the conduct of their respective businesses. This Contract does not create a partnership, joint venture, master- servant, principal-agent, or any other relationship.

11. LIABILITY

Vendor must indemnify, save, and hold Sourcewell and its Members, including their agents and employees, harmless from any claims or causes of action, including attorneys’ fees, arising out of the performance of this Contract by the Vendor or its agents or employees; this indemnification includes injury or death to person(s) or property alleged to have been caused by some defect in the Equipment, Products, or Services under this Contract to the extent the Equipment, Product, or Service has been used according to its specifications.

Neither party, nor its officers, directors, employees, or Affiliates, shall be liable to the other for any special, indirect, incidental, consequential, punitive, or exemplary damages including, but not limited to, lost profits, business interruption, loss of data, or cost of cover even if the party

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alleged to be liable has knowledge of the possibility of such damages. The limitations set forth in this Section shall not apply to, or in any way limit liabilities arising from, a party’s gross negligence or willful misconduct, or from the confidentiality or indemnification obligations of that party.

12. AUDITS

Sourcewell reserves the right to review the books, records, documents, and accounting procedures and practices of the Vendor relevant to this Contract for a minimum of three (3) years from the end of this Contract. This clause extends to Members as it relates to business conducted by that Member under this Contract. Any audit requests shall be made with thirty (30) days advance written notice and shall be conducted during normal business hours at Vendor’s corporate offices. If a third-party consultant or auditor is used, Vendor may require the execution of a confidentiality agreement prior to receiving access to any records.

13. GOVERNMENT DATA PRACTICES

Vendor and Sourcewell must comply with the Minnesota Government Data Practices Act, Minnesota Statutes Chapter 13, as it applies to all data provided by or provided to Sourcewell under this Contract and as it applies to all data created, collected, received, stored, used, maintained, or disseminated by the Vendor under this Contract.

If the Vendor receives a request to release the data referred to in this article, the Vendor must immediately notify Sourcewell and Sourcewell will assist with how the Vendor should respond to the request.

14. INTELLECTUAL PROPERTY

As applicable, Vendor agrees to indemnify and hold harmless Sourcewell and its Members against any and all suits, claims, judgments, and costs instituted or recovered against Sourcewell or Members by any person on account of the use of any Equipment or Products by Sourcewell or its Members supplied by Vendor in violation of applicable patent or copyright laws.

15. PUBLICITY, MARKETING, AND ENDORSEMENT

A. PUBLICITY. Any publicity regarding the subject matter of this Contract must not be released without prior written approval from the Authorized Representatives. Publicity includes notices, informational pamphlets, press releases, research, reports, signs, and similar public notices prepared by or for the Vendor individually or jointly with others, or any subcontractors, with respect to the program, publications, or services provided resulting from this Contract.

B. MARKETING. Any direct advertising, marketing, or offers with Members must be approved by Sourcewell. Materials should be sent to the Sourcewell Contract Administrator assigned to

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this Contract. Any use by Sourcewell of Vendor’s trademarks, logos, or other intellectual property shall be subject to Vendor’s prior written consent.

C. ENDORSEMENT. The Vendor must not claim that Sourcewell endorses its Equipment, Products, or Services.

16. GOVERNING LAW, JURISDICTION, AND VENUE

Minnesota law governs this Contract. Venue for all legal proceedings out of this Contract, or its breach, must be in the appropriate state court in Todd County or federal court in Fergus Falls, Minnesota.

17. FORCE MAJEURE

Neither party to this Contract will be held responsible for delay or default caused by acts of God or other conditions that are beyond that party’s reasonable control. A party defaulting under this provision must provide the other party prompt written notice of the default.

18. SEVERABILITY

If any provision of this Contract is found to be illegal, unenforceable, or void then both Sourcewell and Vendor will be relieved of all obligations arising under such provisions. If the remainder of this Contract is capable of performance, it will not be affected by such declaration or finding and must be fully performed.

19. PERFORMANCE, DEFAULT, AND REMEDIES

A. PERFORMANCE. During the term of this Contract, the parties will monitor performance and address unresolved contract issues as follows:

1. Notification. The parties must promptly notify each other of any known dispute and work in good faith to resolve such dispute within a reasonable period of time. If necessary, Sourcewell and the Vendor will jointly develop a short briefing document that describes the issue(s), relevant impact, and positions of both parties.

2. Escalation. If parties are unable to resolve the issue in a timely manner, as specified above, either Sourcewell or Vendor may escalate the resolution of the issue to a higher level of management. The Vendor will have thirty (30) calendar days to cure an outstanding issue.

3. Performance while Dispute is Pending. Notwithstanding the existence of a dispute, the Vendor must continue without delay to carry out all of its responsibilities under the Contract that are not affected by the dispute. If the Vendor fails to continue without delay to perform its responsibilities under the Contract, in the accomplishment of all undisputed work, any additional costs incurred by Sourcewell and/or its Members as a result of such failure to proceed will be borne by the Vendor.

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B. DEFAULT AND REMEDIES. Either of the following constitutes cause to declare this Contract, or any Member order under this Contract, in default:

1. Nonperformance of contractual requirements, or

2. A material breach of any term or condition of this Contract.

Written notice of default and a reasonable opportunity to cure must be issued by the party claiming default. Time allowed for cure will not diminish or eliminate any liability for liquidated or other damages. If the default remains after the opportunity for cure, the non-defaulting party may:

• Exercise any remedy provided by law or equity, or
• Terminate the Contract or any portion thereof, including any orders issued against the Contract.

20. INSURANCE

A. REQUIREMENTS. At its own expense, Vendor must maintain insurance policy(ies) in effect at all times during the performance of this Contract with insurance company(ies) licensed or authorized to do business in the State of Minnesota having an “AM BEST” rating of A- or better, with coverage and limits of insurance not less than the following:

1. Workers’ Compensation and Employer’s Liability.

Workers’ Compensation: As required by any applicable law or regulation.

Employer's Liability Insurance: must be provided in amounts not less than listed below:

Minimum limits:
$500,000 each accident for bodily injury by accident
$500,000 policy limit for bodily injury by disease
$500,000 each employee for bodily injury by disease

2. Commercial General Liability Insurance. Vendor will maintain insurance covering its operations, with coverage on an occurrence basis, and must be subject to terms no less broad than the Insurance Services Office (“ISO”) Commercial General Liability Form CG0001 (2001 or newer edition). At a minimum, coverage must include liability arising from premises, operations, bodily injury and property damage, products-completed operations including construction defect, contractual liability, and personal injury and advertising injury. All required limits, terms and conditions of coverage must be maintained during the term of this Contract.

Minimum Limits:
$1,000,000 each occurrence Bodily Injury and Property Damage $1,000,000 Personal and Advertising Injury
$2,000,000 aggregate for Products-Completed operations
$2,000,000 general aggregate

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3. Commercial Automobile Liability Insurance. During the term of this Contract, Vendor will maintain insurance covering all owned, hired, and non-owned automobiles in limits of liability not less than indicated below. The coverage must be subject to terms no less broad than ISO Business Auto Coverage Form CA 0001 (2010 edition or newer).

Minimum Limits:
$1,000,000 each accident, combined single limit

4. Umbrella Insurance. During the term of this Contract, Vendor will maintain umbrella coverage overEmployer’s Liability, Commercial General Liability, and Commercial Automobile.

Minimum Limits:
$2,000,000

5. Professional/Technical, Errors and Omissions, and/or Miscellaneous Liability.

During the term of this Contract, Vendor will maintain coverage for all claims the Vendor may become legally obligated to pay resulting from any actual or alleged negligent act, error, or omission related to Vendor’s professional services required under this Contract.

Minimum Limits:
$2,000,000

6. Network Security and Privacy Liability Insurance. During the term of this Contract, Vendor will maintain coverage for network security and privacy liability. The coverage may be endorsed on another form of liability coverage or written on a standalone policy. The insurance must cover claims which may arise from failure of Vendor’s security resulting in, but not limited to, computer attacks, unauthorized access, disclosure of not public data – including but not limited to, confidential or private information, transmission of a computer virus, or denial of service.

Minimum limits:
$2,000,000

Failure of Vendor to maintain the required insurance will constitute a material breach entitling Sourcewell to immediately terminate this Contract for default.

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B. CERTIFICATES OF INSURANCE. Upon commencing under this Contract, Vendor must furnish to Sourcewell a certificate of insurance, as evidence of the insurance required under this Contract. Prior to expiration of the policy(ies), renewal certificates must be mailed to Sourcewell, 202 12th Street Northeast, P.O. Box 219, Staples, MN 56479 or sent to the Sourcewell Contract Administrator assigned to this Contract. The certificates must be signed byan authorized representative. All policies must include there will be no cancellation, suspension, non-renewal, or reduction of coverage without thirty (30) days’ prior written notice to the Vendor.

Upon request, Vendor must provide to Sourcewell copies of applicable endorsements, within ten (10) days of a request. Failure to request certificates of insurance by Sourcewell, or failure of Vendor to provide certificates of insurance, in no way limits or relieves Vendor of its duties and responsibilities in this Contract.

C. ADDITIONAL INSURED ENDORSEMENT AND PRIMARY AND NON-CONTRIBUTORY INSURANCE CLAUSE. Vendor agrees to name Sourcewell and its Members, including their officers, agents, and employees, as an additional insured under the Vendor’s commercial general liability insurance policy with respect to liability arising out of activities, “operations,” or “work” performed by or on behalf of Vendor, and products and completed operations of Vendor. The policy provision(s) or endorsement(s) must further provide that coverage is primary and not excess over or contributory with any other valid, applicable, and collectible insurance or self-insurance maintained by the additional insureds. Notwithstanding the minimum limits of coverages set forth herein, Vendor shall name Sourcewell and its Members, including their officers, agents, and employees as an additional insured for the full limits of insurance coverage, including but not limited to any excess policy coverage, purchased by Vendor.

D. WAIVER OF SUBROGATION. Vendor waives and must require (by endorsement or otherwise) all its insurers to waive subrogation rights against Sourcewell and other additional insureds for losses paid under the insurance policies required by this Contract. The waiver must apply to all deductibles and/or self-insured retentions applicable to the required insurance maintained by the Vendor

E. UMBRELLA/EXCESS LIABILITY. The limits required by this Contract can be met by either providing a primary policy or in combination with umbrella/excess liability policy(ies).

21. COMPLIANCE

A. LAWS AND REGULATIONS. All Equipment, Products, or Services provided under this Contract must comply fully with applicable federal laws and regulations, and with the laws in the states and provinces in which the Equipment, Products, or Services are sold.

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B. LICENSES. Vendor must maintain a valid status on all required federal, state, and local licenses, bonds, and permits required for the operation of the business that the Vendor conducts with Sourcewell and Members.

22. BANKRUPTCY, DEBARMENT, OR SUSPENSION CERTIFICATION

Vendor certifies and warrants that it is not in bankruptcy or that it has previously disclosed in writing certain information to Sourcewell related to bankruptcy actions. If at any time during this Contract Vendor declares bankruptcy, Vendor must immediately notify Sourcewell in writing.

Vendor certifies and warrants that neither it nor its principals are presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from programs operated by the State of Minnesota, the United States federal government, or any Member.

Vendor certifies and warrants that neither it nor its principals have been convicted of a criminal offense related to the subject matter of this Contract. Vendor further warrants that it will provide immediate written notice to Sourcewell if this certification changes at any time.

23. PROVISIONS FOR NON-UNITED STATES FEDERAL ENTITY PROCUREMENTS UNDER

UNITED STATES FEDERAL AWARDS OR OTHER AWARDS

Members that use United States federal grant or FEMA funds to purchase goods or services from this Contract may be subject to additional requirements including the procurement standards of the Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards, 2 C.F.R. § 200. Members may also require additional requirements based on specific funding specifications. Within this Article, all references to “federal” should be interpreted to mean the United States federal government. The following list only applies when a Member accesses Vendor’s Equipment, Products, or Services with United States federal funds.

A. EQUAL EMPLOYMENT OPPORTUNITY. Except as otherwise provided under 41 C.F.R. § 60, all contracts that meet the definition of “federally assisted construction contract” in 41 C.F.R. § 60-

1.3 must include the equal opportunity clause provided under 41 C.F.R. §60-1.4(b), in accordance with Executive Order 11246, “Equal Employment Opportunity” (30 FR 12319, 12935, 3 C.F.R. §, 1964-1965 Comp., p. 339), as amended by Executive Order 11375, “Amending Executive Order 11246 Relating to Equal Employment Opportunity,” and implementing regulations at 41 C.F.R. § 60, “Office of Federal Contract Compliance Programs, Equal Employment Opportunity, Department of Labor.” The equal opportunity clause is incorporated herein by reference.

B. DAVIS-BACON ACT, AS AMENDED (40 U.S.C. § 3141-3148). When required by federal program legislation, all prime construction contracts in excess of $2,000 awarded by non- federal entities must include a provision for compliance with the Davis-Bacon Act (40 U.S.C. § 3141-3144, and 3146-3148) as supplemented by Department of Labor regulations (29 C.F.R. § 5,

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“Labor Standards Provisions Applicable to Contracts Covering Federally Financed and Assisted Construction”). In accordance with the statute, contractors must be required to pay wages to laborers and mechanics at a rate not less than the prevailing wages specified in a wage determination made by the Secretary of Labor. In addition, contractors must be required to pay wages not less than once a week. The non-federal entity must place a copy of the current prevailing wage determination issued by the Department of Labor in each solicitation. The decision to award a contract or subcontract must be conditioned upon the acceptance of the wage determination. The non-federal entity must report all suspected or reported violations to the federal awarding agency. The contracts must also include a provision for compliance with the Copeland “Anti-Kickback” Act (40 U.S.C. § 3145), as supplemented by Department of Labor regulations (29 C.F.R. § 3, “Contractors and Subcontractors on Public Building or Public Work Financed in Whole or in Part by Loans or Grants from the United States”). The Act provides that each contractor or subrecipient must be prohibited from inducing, by any means, any person employed in the construction, completion, or repair of public work, to give up any part of the compensation to which he or she is otherwise entitled. The non-federal entity must report all suspected or reported violations to the federal awarding agency. Vendor must be in compliance with all applicable Davis-Bacon Act provisions.

C. CONTRACT WORK HOURS AND SAFETY STANDARDS ACT (40 U.S.C. § 3701-3708). Where applicable, all contracts awarded by the non-federal entity in excess of $100,000 that involve the employment of mechanics or laborers must include a provision for compliance with 40 U.S.C. § 3702 and 3704, as supplemented by Department of Labor regulations (29 C.F.R. § 5).

Under 40 U.S.C. § 3702 of the Act, each contractor must be required to compute the wages of every mechanic and laborer on the basis of a standard work week of 40 hours. Work in excess of the standard work week is permissible provided that the worker is compensated at a rate of not less than one and a half times the basic rate of pay for all hours worked in excess of 40 hours in the work week. The requirements of 40 U.S.C. § 3704 are applicable to construction work and provide that no laborer or mechanic must be required to work in surroundings or under working conditions which are unsanitary, hazardous or dangerous. These requirements do not apply to the purchases of supplies or materials or articles ordinarily available on the open market, or contracts for transportation or transmission of intelligence. This provision is hereby incorporated by reference into this Contract. Vendor certifies that during the term of an award for all contracts by Sourcewell resulting from this procurement process, Vendor must comply with applicable requirements as referenced above.

D. RIGHTS TO INVENTIONS MADE UNDER A CONTRACT OR AGREEMENT. If the federal award meets the definition of “funding agreement” under 37 C.F.R. § 401.2(a) and the recipient or subrecipient wishes to enter into a contract with a small business firm or nonprofit organization regarding the substitution of parties, assignment or performance of experimental, developmental, or research work under that “funding agreement,” the recipient or subrecipient must comply with the requirements of 37 C.F.R. § 401, “Rights to Inventions Made by Nonprofit Organizations and Small Business Firms Under Government Grants, Contracts and Cooperative Agreements,” and any implementing regulations issued by the awarding agency. Vendor

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certifies that during the term of an award for all contracts by Sourcewell resulting from this procurement process, Vendor must comply with applicable requirements as referenced above.

E. CLEAN AIR ACT (42 U.S.C. § 7401-7671Q.) AND THE FEDERAL WATER POLLUTION CONTROL ACT (33 U.S.C. § 1251-1387). Contracts and subgrants of amounts in excess of $150,000 require the non-federal award to agree to comply with all applicable standards, orders or regulations issued pursuant to the Clean Air Act (42 U.S.C. § 7401- 7671q) and the Federal Water Pollution Control Act as amended (33 U.S.C. § 1251- 1387). Violations must be reported to the Federal awarding agency and the Regional Office of the Environmental Protection Agency (EPA). Vendor certifies that during the term of this Contract will comply with applicable requirements as referenced above.

F. DEBARMENT AND SUSPENSION (EXECUTIVE ORDERS 12549 AND 12689). A contract award (see 2 C.F.R. § 180.220) must not be made to parties listed on the government wide exclusions in the System for Award Management (SAM), in accordance with the OMB guidelines at 2 C.F.R. §180 that implement Executive Orders 12549 (3 C.F.R. § 1986 Comp., p. 189) and 12689 (3 C.F.R. § 1989 Comp., p. 235), “Debarment and Suspension.” SAM Exclusions contains the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties declared ineligible under statutory or regulatory authority other than Executive Order 12549. Vendor certifies that neither it nor its principals are presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation by any federal department or agency.

G. BYRD ANTI-LOBBYING AMENDMENT, AS AMENDED (31 U.S.C. § 1352). Vendors must file any required certifications. Vendors must not have used federal appropriated funds to pay any person or organization for influencing or attempting to influence an officer or employee of any agency, a member of Congress, officer or employee of Congress, or an employee of a member of Congress in connection with obtaining any federal contract, grant, or any other award covered by 31 U.S.C. § 1352. Vendors must disclose any lobbying with non-federal funds that takes place in connection with obtaining any federal award. Such disclosures are forwarded from tier to tier up to the non-federal award. Vendors must file all certifications and disclosures required by, and otherwise comply with, the Byrd Anti-Lobbying Amendment (31 U.S.C. § 1352).

H. RECORD RETENTION REQUIREMENTS. To the extent applicable, Vendor must comply with the record retention requirements detailed in 2 C.F.R. § 200.333. The Vendor further certifies that it will retain all records as required by 2 C.F.R. § 200.333 for a period of three (3) years after grantees or subgrantees submit final expenditure reports or quarterly or annual financial reports, as applicable, and all other pending matters are closed.

I. ENERGY POLICY AND CONSERVATION ACT COMPLIANCE. To the extent applicable, Vendor must comply with the mandatory standards and policies relating to energy efficiency which are contained in the state energy conservation plan issued in compliance with the Energy Policy and Conservation Act.

012320-SCC

J. BUY AMERICAN PROVISIONS COMPLIANCE. To the extent applicable, Vendor must comply with all applicable provisions of the Buy American Act. Purchases made in accordance with the Buy American Act must follow the applicable procurement rules calling for free and open competition.

K. ACCESS TO RECORDS (2 C.F.R. § 200.336). Vendor agrees that duly authorized representatives of a federal agency must have access to any books, documents, papers and records of Vendor that are directly pertinent to Vendor’s discharge of its obligations under this Contract for the purpose of making audits, examinations, excerpts, and transcriptions. The right also includes timely and reasonable access to Vendor’s personnel for the purpose of interview and discussion relating to such documents.

L. PROCUREMENT OF RECOVERED MATERIALS (2 C.F.R. § 200.322). A non-federal entity that is a state agency or agency of a political subdivision of a state and its contractors must comply with Section 6002 of the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act. The requirements of Section 6002 include procuring only items designated in guidelines of the Environmental Protection Agency (EPA) at 40 C.F.R. § 247 that contain the highest percentage of recovered materials practicable, consistent with maintaining a satisfactory level of competition, where the purchase price of the item exceeds $10,000 or the value of the quantity acquired during the preceding fiscal year exceeded $10,000; procuring solid waste management services in a manner that maximizes energy and resource recovery; and establishing an affirmative procurement program for procurement of recovered materials identified in the EPA guidelines.

24. CANCELLATION

Sourcewell or Vendor may cancel this Contract at any time, with or without cause, upon sixty (60) days’ written notice to the other party. However, Sourcewell may cancel this Contract immediately upon discovery of a material defect in any certification made in Vendor’s Proposal.

Termination of this Contract does not relieve either party of financial, product, or service obligations incurred or accrued prior to termination. In addition, Vendor may terminate this Contract for any reason (i.e., for convenience) with respect to an individual Member by delivering not less than ninety (90) days prior written notice thereof to Sourcewell and the applicable Member.

_________________ _______________

012320-SCC

Sourcewell Staples Contract & Commercial LLC
By: _ By:

Jeremy Schwartz Joanne Harris
Title: Director of Operations &
Procurement/CPO
Title: Chief Commercial Officer

4/2/2020 | 1:37 PM CDT
Date:

Date: 4/9/2020 | 11:29 AM CDT

Approved:

By:

Chad Coauette
Title: Executive Director/CEO

Date: 4/9/2020 | 11:30 AM CDT

RFP 012320 - Office Supply Catalog Solutions

Vendor Details

Company Name: Staples Contract & Commercial LLC
Does your company conduct
business under any other name? If
yes, please state:

Address:

See Staples W-9 for list of company names

500 Staples Drive

Framingham, MA 01702
Contact: Don Hasch
Email: [email protected]
Phone: 714-868-4274
HST#: 04-2896127

Submission Details

Created On: Thursday December 05, 2019 16:29:54
Submitted On: Thursday January 23, 2020 14:19:24
Submitted By: Don Hasch
Email: [email protected]
Transaction #: 03530933-5d38-4e03-a53c-27c14c4f6471
Submitter's IP Address: 170.37.244.38

Specifications

Table 1: Proposer Identity & Authorized Representatives

General Instructions (applies to all Tables) Sourcewell prefers a brief but thorough response to each question. Please do not merely attach additional documents to your response without also providing a substantive response. Do not leave answers blank; mark “NA” if the question does not apply to you (preferably with an explanation).

Line
Item Question Response *
1 Proposer Legal Name (and
applicable d/b/a, if any):

Staples Contract & Commercial LLC (Staples) *
2 Proposer Address: 500 Staples Drive, Framingham, MA 01702 * 3 Proposer website address: www.StaplesAdvantage.com *
4 Proposer's Authorized
Representative (name, title,
address, email address & phone)
(The representative must have
authority to sign the “Proposer's
Assurance of Compliance” on
behalf of the Proposer):

Joanne Harris
Chief Commercial Officer, Staples
500 Staples Drive, Framingham, MA 01702
Email: [email protected]
Phone: (508) 253-5000

*
5 Proposer's primary contact for this
proposal (name, title, address,
email address & phone):

Don Hasch
Senior Manager - SLED Team (State, Local, and Education) 16501 Trojan Way, La Mirada, CA 90638
Email: [email protected]
Phone: (714) 868-4274

*
6 Proposer's other contacts for this
proposal, if any (name, title,
address, email address & phone):

Jeremy Landis
Area Vice President - Vertical Markets
1945 Old Gallows Rd, Suite 200, Vienna, VA 22182
Email: [email protected]
Phone: (571) 581-3829

Joseph Gorman
Vice President - Commercial Sales
1414 Radcliffe Street, Suite 110, Bristol, PA 19007
Phone: (215) 292-3160
Email: [email protected]

Table 2: Company Information and Financial Strength

Line
Item Question Response *

*
7 Provide a brief history of your company,
including your company's core values,
business philosophy, and industry longevity
related to the requested equipment, products
or services.

Staples, The Worklife Fulfilment Company, has 33 years of expertise helping organizations of all sizes be more productive, connected and inspired — however and wherever they work today. With dedicated account teams, category professionals, innovative brands and a curated assortment for business, Staples provides customized solutions to help organizations achieve their goals. Headquartered near Boston, Staples operates in North America.

As the pioneer of office solutions, Staples knows work is more than a job. It is a sense of purpose and fulfillment that defines us. As “The Worklife Fulfillment Company”, we have programs that fit every size organization, from a one-person office to the Fortune 100 organization, across all industries, including academic institutions, healthcare, state and federal governments. We're here to help with products, services and solutions, combined with our expertise, best-in-class national distribution, customer service, competitive pricing and state-of-the-art e-commerce site.

WORKLIFE PRODUCTS & SOLUTIONS
Our products, services and technology are thoughtfully designed and sourced for the way you work and live. We'll help you and your teams with Worklife:
• Productivity – Helping customers and their teams do more. • Connectivity – Building better communication and ways of working. • Inspiration – Inciting creative thinking through spaces that feel good.

YOU CAN COUNT ON US
• Reliable financial stability allows us to continually evolve to meet the needs of our customers, as a strong stable supplier.
• Community involvement with 42,000 associates across the U.S. who live and work where your Members do.
• Eco-responsible business partner to help customers boost everyday sustainability.

DocuSign Envelope ID: 4D82BD89-57E9-4B05-B822-2A0034DCA09F

*

*
8 Provide a detailed description of the products
and services that you are offering in your
proposal.

From business essentials to facility supplies, and custom print to furniture, Staples offers an unmatched selection of products and services, saving your participating Members the time and expense of dealing with multiple vendors. With free next-day delivery available for more than 500,000 products on our e-commerce site, our industry-leading breadth and depth of solutions includes:

INNOVATIVE PRODUCT SOLUTIONS
With the introduction of our new innovative products we offer tools and systems that help drive solutions in business essentials, breakroom, facilities, technology and furniture:
• Tru Red – Thoughtfully designed business essentials to help you work, create and innovate better. Quality tested and engineered to last. • NXT Technologies – Tech products to keep your teams connected and productive — whether they're at the office or the airport, a coffeehouse or the couch. • Coastwide Professional – Professional-grade facility and pack and ship supplies built to spec and made to perform, with no wasted product or labor. • Perk – Breakroom essentials designed with quality, value and just the right touch of personality to bring fun and energy to break time. • Union & Scale – Furniture and decor that work together in perfect harmony.

There's a collection for every style and work style.

We've simplified our product assortment to focus on the right choices for business and institutions versus every product out there. So, it will be easier for your participating Members to get exactly what they need.
• Business Essentials – Staples can help participating Members search for a better way. We fulfill the essentials for teams to be more productive, more organized and more inspired. We carry everything from copy paper to smart phones and accessories, with a wide selection of green and MWBE products. • Facility Solutions – We know that results matter. We can work with participating Members to provide a clean, efficient and seamlessly stocked workspace. Our Facility Solutions offering includes a wide selection of products from best-in-class manufacturers, including Diversey, GOJO, Georgia-Pacific, Kimberly-Clark and Rubbermaid. Our exclusive BluPrint™ site assessment tool helps to analyze participating Members' facilities operations to offer cost saving recommendations. • Furniture Solutions – We can work with participating Members on their journey to create a productive, collaborative environment with inspired workspaces through our products, technology, people and services. Our Furniture Solutions offering provides access to more than 250 best-in-class manufacturers, including Allsteel, HON, Global and National.
• Print & Marketing Services – We can create custom print essentials and high- quality products through our expertise and technology. Every year, we handle more than 396,000 print jobs. It is clear customers are already choosing Staples as their trusted print provider.
• Technology Solutions – We offer differentiated and thoughtfully designed tech products and exclusive brands. Our Technology Solutions offering includes a wide selection of products from everyday tech and data center solutions to printer fleet management and network services. With more than 1,000 vendors and suppliers, we offer more than one million items delivered nationwide. • Breakroom Solutions – We can help participating Members create a more connected and inspired workspace with a complete breakroom experience. From coffee and coffee brewers to water coolers, cutlery and snacks, the wide variety of products we offer in this category continues to match the needs of every generation in the workforce. Our breakroom specialists are ready to analyze your space and provide cost saving recommendations.
• Pack & Ship Solutions – We can unlock advancements through our products, people and supply chain. We can help keep your operations running smoothly. From sourcing package-specific tape to helping lower your damage rate, our Pack & Ship Specialists partner with you to drive efficiency in your participating Members' operations.
• Staples Promotional Products – With more than one million products plus well- cultivated relationships with a global supply network, Staples can help participating Members create unique branded solutions for all their buying needs. 9 What are your company's expectations in the
event of an award?
Our expectation is to build on our already strong and dynamic partnership, and to continue to drive tremendous value, efficiencies and savings to existing and future Sourcewell Members. Our hope is that many more Sourcewell Members will join the thousands of existing participating Members currently enjoying the benefits that our Sourcewell awarded contracts offer. Our goal is to enhance our value in becoming a true sustainable resource for your Members, providing industry intelligence, advice and research collateral to further supplement the products/services we have offered in the past. Our expectation is to continue the trend of exponential sales growth year over year that we have experienced as a contract award holder for the past 15 years.

10 Demonstrate your financial strength and
stability with meaningful data. This could
include such items as financial statements,
SEC filings, credit and bond ratings, letters
of credit, and detailed reference letters.

Upload supporting documents (as applicable)
in the document upload section of your
response.

Staples represents that it has the financial resources available to perform its obligations under an agreement reached between Staples and Sourcewell. Please see Attachment 1 for Staples' Bank and Trade References.

Staples became a private company in 2017 and no longer publicly reports our financial information. Staples can provide limited financial information directly to Dr.

Chad Coauette, Executive Director & CEO at Sourcewell, once we have a current, fully executed Non-Disclosure Agreement in place. If provided, please note that our financial information would be considered Trade Secret.

*
11 What is your US market share for the
solutions that you are proposing?
Staples' leading financial position allows the company to invest in its business, expand its products and services and provide customers with the confidence of working with a strong and stable supplier. We have programs that fit every size organization, across all industries. As a private company, Staples considers our market position confidential, however, Staples serves more than 2.5 million small, mid- size and commercial enterprise business customers, including many of the largest and most trusted companies and institutions in the U.S.

*
12 What is your Canadian market share, if any? Please see our response to Question 11 above. * 13 Has your business ever petitioned for
bankruptcy protection? If so, explain in detail.

No. Staples Contract & Commercial LLC has never been the subject of a bankruptcy action. *
14 How is your organization best described: is it
a manufacturer, a distributor/dealer/reseller, or
a service provider? Answer whichever
question (either a) or b) just below) best
applies to your organization.
a) If your company is best described as a
distributor/dealer/reseller (or similar entity),
provide your written authorization to act as a
distributor/dealer/reseller for the manufacturer
of the products proposed in this RFP. If
applicable, is your dealer network
independent or company owned?
b) If your company is best described as a
manufacturer or service provider, describe
your relationship with your sales and service
force and with your dealer network in
delivering the products and services proposed
in this RFP. Are these individuals your
employees, or the employees of a third party?
Staples is best described as (a) a distributor/dealer/reseller. Staples is authorized to resell all products offered under this proposal by the terms of Vendor Program Agreements (VPA) established with each of our suppliers. Upon request, Staples is willing to provide Sourcewell with specifics of our authorization as a reseller from any of the manufacturers we represent.

Staples also intends to utilize certain company affiliates under the Staples, Inc. umbrella to serve as authorized dealers and distributors under this agreement. Any sales by such affiliates pursuant to this agreement would be reflected in a written agreement between such affiliate and Sourcewell participating Member with reference made to the Staples/Sourcewell contract. These affiliates include DEX Imaging LLC, a leading nationwide managed print services provider.

*
15 If applicable, provide a detailed explanation
outlining the licenses and certifications that
are both required to be held, and actually
held, by your organization (including third
parties and subcontractors that you use) in
pursuit of the business contemplated by this
RFP.

Staples is licensed to do business in all 50 U.S. states, Puerto Rico and U.S. territories. Staples is fully compliant with all applicable federal and state laws and regulations. Staples also requires that all third-party companies and subcontractors that may be utilized in the provision of the services contemplated under this RFP hold all required business licenses and certifications required by law.

The following are functions where Staples may involve subcontractors in the provision of the products and services contemplated by this RFP:
• Delivery: We utilize a combination of our own fleet and carefully selected third- party courier providers to supplement our territory reach as needed. • Service, Installation & Repair: Some product lines, such as managed print services, furniture and facility solutions may involve service, repair and installation functions.
• Diversity One Program: Staples has established strategic alliances with highly respected diverse and small business suppliers who have extensive experience serving the public sector and large institutional customers.

We will be happy to share additional information with Sourcewell upon request.

*
16 Provide all “Suspension or Debarment”
information that has applied to your
organization during the past ten years.

Staples Contract & Commercial LLC has not been debarred, suspended, proposed for debarment, or declared ineligible for the award of contracts by any federal agency during the past ten years.

*
17 Within this RFP category there may be
subcategories of solutions. List subcategory
titles that best describe your products and
services.

Staples offers hundreds of thousands of products in a host of categories that are necessary for Sourcewell Members to manage and maintain their operations and facilities. These categories are ever evolving as customers' needs evolve but they currently include product categories such as office and school supplies, janitorial products and equipment, breakroom, safety, transactional furniture, print, promotional products, technology hardware and software as well as mobile peripherals including tablets, and more. Staples continues to invest in and expand into these and many other product segments based on customer and industry demand.

*

Table 3: Industry Recognition & Marketplace Success

Line
Item Question Response *
18 Describe any relevant industry awards or
recognition that your company has received
in the past five years
Thanks to the collaborative effort of our leadership team and our associates around the world, Staples continuously receives awards and accolades for our service and corporate responsibility.

COMPANY RANKINGS
• #20 on Forbes America's Largest Private Companies list for 2018 • #4 on Modern Distribution Management's Top Jan/San Distributors list for 2018 • #2 on Advertising Specialty Institute's Top 40 Promotional Products Distributors list for 2019
• #63 on National Retail Federation's Top 100 Retailers list for 2019

ENVIRONMENTAL AWARDS & RECOGNITIONS
• Awarded U.S. EPA's ENERGY STAR Partner of the Year-Sustained Excellence in 2019 for the 10th year
• S&P Global Platts Grid Edge Award Finalist 2018
• Ranked #13 among retailers on the 2018 Green Power Top Partnership list from the U.S. EPA
• S&P Global Platts Corporate Social Responsibility Award Winner 2017 • Selected as component of the Dow Jones Sustainability Indices in 2017 for the 14th consecutive year
• Received the 2016 Alliance to Save Energy's Built Environment Star of Energy Efficiency Awar d for our commitment to reducing energy consumption and improving efficiency in stores

DIVERSITY AWARDS & RECOGNITIONS
• Lesa Rivers, Director of Supplier Diversity, nominated as one of 2014's Top 25 Women in Power Impacting Diversity by DiversityPlus Magazine • Named one of the 2018 Best Places to Work for LGBTQ Equality by the Human Rights Campaign for eight consecutive years

SUPPLIER AWARDS
• NJPA (Sourcewell) Legacy Award (2015)
• HP U.S. Partner to Watch (2017)
• HP U.S. Supplies Partner of the Year (2017)
• CBRE Supplier of the Year (2017)

*
19 What percentage of your sales are to the
governmental sector in the past three years
Staples considers corporate financial information to be proprietary. However, based on our own mutual sales, we achieved over $70M in state and municipal government sector sales annually under our Sourcewell awarded contracts.

Staples' response to question 19 should be considered as “Trade Secret”, as defined by Minnesota Statutes 325C.01, Subd. 5. Exempt from public disclosure under applicable law.

*
20 What percentage of your sales are to the
education sector in the past three years
Staples considers corporate financial information to be proprietary. However, based on our own mutual sales, we achieved over $160M in education sector sales annually under our Sourcewell awarded contracts.

Staples' response to question 20 should be considered as “Trade Secret”, as defined by Minnesota Statutes 325C.01, Subd. 5. Exempt from public disclosure under applicable law.

*
21 List any state or cooperative purchasing
contracts that you hold. What is the annual
sales volume for each of these contracts
over the past three years?
Staples holds the following national public sector cooperative contracts:
• Sourcewell
• NASPO ValuePoint
• NPP Gov
• E&I
Staples holds numerous state office products purchasing contracts throughout the U.S, including multiple states that have adopted our existing Sourcewell 010615-SCC Office & Related Supplies contract as their state office supplies contract vehicle.

Staples considers corporate financial information to be proprietary.

*
22 List any GSA contracts that you hold. What
is the annual sales volume for each of these
contracts over the past three years?
Staples has the following GSA contracts:
• 47QSEA19D008T – Schedule 75: Enhanced SIN for Office Supplies & Services/Office Supplies 4th Generation (OS4)
• GS-07F-035BA – Schedule 73: Food Service, Hospitality, Cleaning Equipment and Supplies, Chemicals and Services
• GS-28F-018AA – Schedule 71: Furniture
• GS-03F-051GA – Schedule 78: Sports, Promotional, Outdoor, Recreation, Trophies and Signs
Staples considers corporate financial information to be proprietary.

*

Table 4: References/Testimonials

Line Item 23. Supply reference information from three customers who are eligible for Sourcewell membership.

Entity Name * Contact Name * Phone Number *
Hillsborough County Public Schools (Florida) Cristine Jones, CPPB (813) 272-4370 * County of Orange (California) Yarida Guzman (714) 567-7368 * County of Sacramento (California) Craig Rader, CPPO, CPPB (916) 876-6362 *

Table 5: Top Five Government or Education Customers

Line Item 24. Provide a list of your top five government, education, or non-profit customers (entity name is optional), including entity type, the state or province the entity is located in, scope of the project(s), size of transaction(s), and dollar volumes from the past three years.

Entity Name Entity Type * State /
Province * Scope of Work * Size of Transactions * Dollar Volume Past Three Years *

Chicago
Public Schools
Education Illinois - IL Office Supplies and related
products and services
Due to various non-
disclosure agreements in
place, we do not disclose
financial information or
specific contract details
for our customers.

Proprietary Information

*
Hillsborough
County Public
Schools
Education Florida - FL Office Supplies and related
products and services
Due to various non-
disclosure agreements in
place, we do not disclose
financial information or
specific contract details
for our customers.

Proprietary Information

*
Anoka
Hennepin
Independent
School District
#11
Education Minnesota - MN Office Supplies and related
products and services
Due to various non-
disclosure agreements in
place, we do not disclose
financial information or
specific contract details
for our customers.

Proprietary Information

*
University of
Colorado
Education Colorado - CO Office Supplies and related
products and services
Due to various non-
disclosure agreements in
place, we do not disclose
financial information or
specific contract details
for our customers.

Proprietary Information

*
County of
Orange
Government California - CA Office Supplies and related
products and services
Due to various non-
disclosure agreements in
place, we do not disclose
financial information or
specific contract details
for our customers.

Proprietary Information

*

Table 6: Ability to Sell and Deliver Service

Describe your company's capability to meet the needs of Sourcewell Members across the US, and Canada if applicable.Your response should address in detail at least the following areas: locations of your network of sales and service providers, the number of workers (full-time equivalents) involved in each sector, whether these workers are your direct employees (or employees of a third party), and any overlap between the sales and service functions.

Line
Item Question Response *

25 Sales force. Staples has a national service footprint and provides sales coverage to nearly the entire U.S. The map and listing attached does not include the locations of our remote sales teams and account leaders. We have more than 4,500 sales associates dispersed in every major city and market so that we are close to your Members and can quickly meet their needs. Please see Attachment 2 for details on our sales offices nationwide.

Our national account management model leverages a single, centralized point of contact for each participating Member. The Account Manager is empowered to make most decisions regarding pricing, contractual terms and service commitments on a day- to-day basis. Of equal importance is the streamlined internal process we have in place to escalate issues requiring management input or approval. This process enables our Account Managers to provide timely responses to any issue, large or small.
• Business Development – Responsible for communicating the benefits and value of Staples and our offerings to potential new participating Members • Account Manager – Member's partner to provide insights and recommendations on Worklife Solutions
• Category Account Executive – Focuses on specific Staples product categories leveraging their in-depth knowledge and expertise to fully support participating Member needs
• Customer Success Consultant – Member's support to help with their day-to-day needs
• Site Management Team – Team that proactively ensures compliance of each program in all locations
• Category Professionals – Industry experts in facilities, technology, furniture, print and promotional products that provide assessments to recommend efficiencies and savings
• Customer Service – Live knowledgeable representatives available to get answers fast while shopping on our ordering site through live chat and standing by to help via email and phone

*
26 Dealer network or other distribution methods. Staples is best described as a distributor/dealer/reseller. Staples is authorized to resell all products offered under this proposal by the terms of Vendor Program Agreements (VPA) established with each of our suppliers. Upon request, Staples is willing to provide Sourcewell with specifics of our authorization as a reseller from any of the manufacturers we represent.

Staples also intends to utilize certain company affiliates under the Staples, Inc. umbrella to serve as authorized dealers and distributors under this agreement. Any sales by such affiliates pursuant to this agreement would be reflected in a written agreement between such affiliate and Sourcewell participating Member with reference made to the Staples/Sourcewell contract.

*
27 Service force. Staples has a national service footprint that provides service and distribution coverage to nearly the entire U.S., with more than 8,900 fulfillment and delivery associates employed directly by Staples and are nationally dispersed throughout the U.S.

Additionally, Staples has approximately 550 customer service associates in our call centers, including representatives who process fax orders, answer customer emails and provide agent support.

Staples proudly operates the most extensive and technologically advanced distribution network in the industry and Sourcewell participating Members will continue to benefit from a robust national network of fulfillment centers equipped to achieve their next- business-day shipping needs. Our network is strategically located close to our delivery partners, vendors and customers to ensure that we always keep our network costs low. This means getting products to Sourcewell Members accurately, on time, complete and undamaged. Please see Attachment 3 for a list of our fulfillment centers in the U.S.

*

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28 Describe in detail the process and
procedure of your customer service
program, if applicable. Include your
response-time capabilities and
commitments, as well as any incentives that
help your providers meet your stated
service goals or promises.

At Staples, we have a team by each participating Members side, dedicated to serve.

Staples owns and operates four North American call centers staffed with highly trained Staples associates. Additional support is provided offshore, as needed, to reduce wait times and ensure ample coverage for our customers nationwide. All customer service associates provide expert support for more than five million customer inquiries per year.

To drive higher customer satisfaction, Staples provides:
• A One & Done Service Culture – With a first-call resolution rate of 90%, we train and empower our associates to resolve issues at initial contact. • Direct Connection to a Live Representative – Participating Members will always reach a Staples Customer Service Representative right away. Our goal is to answer calls within 30 seconds and reply to emails within four hours. • A Knowledgeable, Highly Trained Team – Every call center associate attends a comprehensive three-week training program covering customer service skills, problem resolution and product information.
• Proactive Alerts – If a delivery delay is expected, we'll let the Member know. • A Continuous Feedback Loop – We review all customer feedback and if the Member is not satisfied, we follow-up with them to make things right.

SERVING SOURCEWELL MEMBERS' NEEDS
Our Customer Service Representatives have access to all the details necessary to provide service specific to participating Members' business, and even their location.

The Staples Customer Service team is their first line of contact for:
• Login support and password resets
• New user set up and adding ship-to locations
• Assisting with online profile management
• Aiding with account setup, expedited ordering and research • Pricing inquiries and special orders processing
• Delivery and backorder tracking
• Billing and tax exemption questions
Customer Service is conveniently available Monday through Friday from 8:00 a.m. to 8:00 p.m. EST by email, phone or via live chat on StaplesAdvantage.com.

CALL CENTER STRUCTURE
• Customer Service Representative – Responsible for order entry, issue resolution, providing order status and product information. This individual has ongoing direct contact with participating Member and develops a strong knowledge of the specifics of their account.
• Order Resolution Associate – Focuses only on order entry, resulting in time and accuracy efficiencies.
• Team Manager – Coordinates the activities of the Customer Service Representatives in each group, ensuring that each account is supported, and procedures are enforced.
• Customer Operations Team – Communicates with participating Member about next- business-day delivery exceptions and rare instances of product cancellations. • Quality Assurance Team – Monitors contact between associates and customers and reports on key customer service trends important to the business. Coaches both managers and associates to improve the quality of customer interactions.

MANAGED PRINT SERVICES
DEX Imaging's Managed Print Services help participating Members create a more efficient, customized and sustainable printing network. DEX Imaging's customer service outreach is a multi-faceted group. There is customer service through each touchpoint of the process: initial meeting, implementation, and ongoing management – making up the participating Member's account team. The DEX Imaging Account Sales Manager is their main point of contact for their MPS program and is in contact with the Member from pre-sale forward. Their customer service representative is involved in the coordination and participation for the installation, setup, and provides solutions for various technological devices while overseeing the customer database. Their project manager is responsible for the implementation of their devices from sale to delivery.

With any equipment troubles, there is a 3-layer approach. Participating Members will speak to either Customer Service, a Service Engineer or have a Service Technician dispatched, depending on the complexity of their issue. DEX Imaging's service department has a historical 99.98% approval rating, due in large part to the exclusive Customer Care Program we've implemented.

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29 Identify any geographic areas of the United
States or Canada that you will NOT be fully
serving through the proposed contract.

Our proposal includes service to all geographic areas in the continental U.S. and Alaska. There are some product and service exceptions and/or additional costs for Hawaii and other U.S. territories. Please see Question 31 below for more details.

Staples is not including Canada in the scope of our proposal.

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30 Identify any Sourcewell Member sectors
(i.e., government, education, not-for-profit)
that you will NOT be fully serving through
the proposed contract. Explain in detail. For
example, does your company have only a
regional presence, or do other cooperative
purchasing contracts limit your ability to
promote another contract?
Staples has a national presence in the U.S. If re-awarded the office products agreement with Sourcewell, Staples will continue its established efforts to promote the Sourcewell agreement in compliance with Staples' contractual obligations and the suitability of the Sourcewell agreement for the applicable prospect/customer.

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31 Define any specific contract requirements or
restrictions that would apply to our
Members in Hawaii and Alaska and in US
Territories.

Staples reserves the right to charge fees to the following locations unless otherwise mutually agreed between Staples and the participating Member.

Delivery to Alaska or Hawaii. The following additional delivery terms apply for shipments to Alaska or Hawaii: Shipments up to 159 lbs. will be shipped with transit times of two to three (2 to 3) business days. Shipments over 159 lbs. or items which cannot be shipped via normal means, including any items which are classified as hazmat or ORM-D (other regulated materials for domestic transport only), are shipped via ocean freight. Staples' policies prohibit shipment of any fully regulated hazmat items. Such items must be shipped directly from the vendor. Ocean shipments will be delivered approximately fourteen (14) calendar days from the date of shipment. All shipments to Alaska or Hawaii will be subject to a 25% surcharge to help offset the cost of freight.

Every country has specific requirements in which both the exporter and importer must follow; here are some additional specific details for U.S. Territories and Possessions:

Delivery to Puerto Rico. The following additional delivery terms apply for shipments to Puerto Rico: Shipments up to 150 lbs. will be shipped with transit times of two (2) business days. Shipments over 150 lbs. are shipped via ocean freight. Any goods classified as ORM-D (other regulated materials for domestic transport only) will also ship ocean freight, regardless of weight. No hazardous goods can be exported to Puerto Rico. Transit time is approximately seven to ten (7 to 10) business days from door-door. Buyer is responsible for all customs or tax filings or applications necessary to effect the importation of the Products. Delays may result from Buyer's failure to satisfy all customs clearance requirements. All taxes, fees, and other costs (including freight) will be charged back to Buyer on a separate invoice.

Delivery to U.S. Virgin Islands. The following additional delivery terms apply for shipments to the U.S. Virgin Islands: Shipments up to 150 lbs. will be shipped UPS WorldShip, using the most commercially advantageous WorldShip service available, with transit times of approximately three (3) business days. Products weighing over 150 lbs. will be shipped via ocean freight. No hazardous goods can be exported to these locations. Any goods classified as ORM-D (other regulated materials for domestic transport only) will ship ocean freight, regardless of weight, and will require an additional five (5) days of transit time. Buyer is responsible for all customs or tax filings or applications necessary to effect the importation of the Products. Delays may result from Buyer's failure to satisfy all customs clearance requirements. All taxes, fees, and other costs (including freight) will be charged back to Buyer on a separate invoice.

Delivery to American Samoa, Guam, Northern Mariana Islands. The following additional delivery terms apply for shipments to American Samoa, Guam, and the Northern Mariana Islands: Shipments up to 150 lbs. will be shipped UPS WorldShip, using the most commercially advantageous WorldShip service available, with transit times of approximately five (5) business days. Products weighing over 150 lbs. will be shipped via ocean freight. No ORM-D goods or hazardous goods can be exported to these locations. Buyer is responsible for all customs or tax filings or applications necessary to effect the importation of the Products. Delays may result from Buyer's failure to satisfy all customs clearance requirements. All taxes, fees and other costs (including freight) will be charged back to Buyer on a separate invoice.

Import/Export. If Staples agrees to export Products from the U.S. to Buyer's locations outside the U.S. (including but not limited to Mexico, Canada and all U.S.

Possessions and Territories) (for these purposes referred to as “Other Locations”), the following applies: (a) Staples will not be the Importer of Record for any Products shipping to Other Locations. Buyer or Buyer's agent shall nominate a customs clearing agent to act on its behalf and to facilitate the import customs clearance process.

Buyer shall be responsible for obtaining any documentation, such as special permit(s) or license(s) that may be required to import Products; (b) Buyer shall be responsible for payment of any customs clearance and duties and taxes and the full freight cost of the shipment; (c) Staples will not provide Certificates of Origin (C/O) or Free Trade Agreement certificates; (d) Staples will not export the following Products: ORM-D (Other Regulated Materials-Domestic); consumables; and/or Products prohibited from export by Staples' vendors; (e) Staples will not export Products to Other Locations in the event any export restriction applies; and (f) Staples will not accept returns from Other Locations unless agreed in writing.

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Table 7: Marketing Plan

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Item Question Response *