Agenda packet — Modesto City Council, February 28, 2023 (part 2 of 5)

two-year extension options, for a revised annual estimated cost of $125,000, and a total revised amount not to exceed $1,000,000 over eight years.

On July 13, 2021, under Resolution 2021-279, Council approved a Second amendment to the Purchasing Agreement with Amazon Business through the OMNIA Partners Public Sector cooperative purchasing organization (formerly known as US Communities and National IPA) for an online marketplace for products to increase the annual estimated amount by $50,000, for a revised annual estimated amount from $125,000 to $175,000, and a total revised amount not to exceed from $1,000,000 to $1,300,000 over eight years and authorizing the Purchasing Manager or her designee to execute the amendment.

All City departments continue to comply with Administrative Directive 7.28 to standardize the purchasing practices for office supplies and office furniture across the organization. With the use of this Agreement and policy, all City departments are required to compare pricing to ensure we are utilizing the lowest cost supplier when purchasing office supplies and furniture.

DISCUSSION:

The Finance Department’s Purchasing Division regularly monitors the monthly spending activity for Amazon Business, Office Depot, Staples and Wardens, all of which are office supply and furniture vendors. Part of this review includes projecting the anticipated annual spend to ensure the amount is within the Council authorized spending limit. Unanticipated supply chain delays, significant increases in inflation (7-25%) and increased demand for parts/supplies resulting from contract service agreements for fire and fleet services were not accounted for in the previous annual spend projections.

Per policy, City departments actively compare pricing with multiple vendors and Amazon Business has increasingly been identified as the lowest competitive pricing with the fastest delivery of these goods compared to the other supply vendors. With the use of Amazon Business, about one-third of the City’s Blanket Purchase Order (PO) Agreements have also declined in spending resulting in an annual savings of over $200,000.

The Purchasing Division has recently implemented several tools available through Amazon Business to manage spending controls within each City department and identify goods that should not be purchased through Amazon Business based on contractual Agreements we already have in place with other vendors. These controls will manage spending levels based on what is authorized by City Council. Once the department reaches their allocated spending levels, they will be blocked from using Amazon Business.

FISCAL IMPACT:

Sufficient funds will be budgeted in all City department’s annual operating budgets to cover the annual increases through the term of the Agreements. Below is a summary of the current annual spending:
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City Council, February 28, 2023
Increase in Online Marketplace Spending

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Online Marketplace Supplier:

Term Period Amazon
Year 1 (go-live Jan 2020) $ 162,246
Year 2 $ 199,898
Year 3 $ 156,356
TOTAL $ 518,500
This Third amendment will include a 10% inflator for the subsequent years of the remaining term of this Agreement. Below are the annual spending limits defined as part of this increase.

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Total $ 175,000 $ 175,000 $ 175,000 $ 310,000 $ 341,000 $375,100 $412,610 $453,871 $2,417,581 COMMITTEE RECOMMENDATION:

This item was presented at the January 23, 2023 Finance Committee and approved to move forward to Council.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving an increase for purchases from Amazon Business Marketplace pursuant to OMNIA Cooperative Contract with Prince William County Schools for an Online Marketplace for Products by the annual estimated amount of $205,000, for a revised annual estimated cost of $380,000, for a total revised amount not to exceed $2,417,581 over eight years; and authorizing the City Manager or his designee to execute the Participating Addendum.

Approved by:

DeAnna Christensen, Director of Finance
Joseph P. Lopez, City Manager
Attachments:

1. Resolution

2. Cooperative Agreement

3. Administrative Directive 7.28

4. Participation Addendum
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1 MODESTO CITY COUNCIL
RESOLUTION NO. 2023-

RESOLUTION APPROVING AN INCREASE FOR PURCHASES FROM

AMAZON BUSINESS MARKETPLACE PURSUANT TO OMNIA

COOPERATIVE CONTRACT WITH PRINCE WILLIAM COUNTY SCHOOLS

FOR AN ONLINE MARKETPLACE FOR PRODUCTS BY THE ANNUAL
ESTIMATED AMOUNT OF $205,000, FOR A REVISED ANNUAL ESTIMATED COST OF $380,000, FOR A TOTAL REVISED AMOUNT NOT TO EXCEED $2,417,581 OVER EIGHT YEARS; AND AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE TO EXECUTE THE PARTICIPATING ADDENDUM.

WHEREAS, city employees have utilized Amazon Business for the purchase of products for the convenience of online ordering, price savings and fast shipping; and WHEREAS, on November 26, 2019 under Resolution 2019-518, Council approved a purchasing agreement with Amazon Business, by utilizing the competitively solicited and awarded contract in the OMNIA Partners portfolio for a two-year term with three two-year extension options, for an annual estimated cost not to exceed $75,000, and a total amount not to exceed $600,000 over eight years; and WHEREAS, on October 27, 2020, under Resolution 2020-439, Council approved a First amendment to the purchasing agreement with Amazon Business through the OMNIA Partners Public Sector cooperative purchasing organization (formerly known as US Communities and National IPA) for an online marketplace for products by $50,000 annually, for a two-year agreement with three two-year extension options, for a revised annual estimated cost of $125,000, and a total revised amount not to exceed $1,000,000 over eight years; and
WHEREAS, on July 13, 2021, under Resolution 2021-279, Council approved a Second amendment to the purchasing agreement with Amazon Business through the OMNIA Partners Public Sector cooperative purchasing organization (formerly known as #12..
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2 US Communities and National IPA) for an online marketplace for products to increase the annual estimated amount by $50,000, for a revised annual estimated amount from $125,000 to $175,000, and a total revised amount not to exceed from $1,000,000 to $1,300,000 over eight years and authorizing the Purchasing Manager or her designee to execute the amendment; and
WHEREAS, the Finance Department Purchasing Division monitors the monthly spending activity for Amazon Business, in addition to the three other office supplier and furniture vendors, Office Depot, Staples and Wardens; and WHEREAS, part of this review includes projecting the anticipated annual spend to ensure the amount is within the Council authorized spending limit; and WHEREAS, one area that was not anticipated over the last two amendments was the drastic increase in inflation ranging from 7-25% over the last couple of years including City departments continuing to have challenges with supply chain delays and not having these operational parts for several months; and WHEREAS, City departments actively compare pricing with other vendors and Amazon Business has increasingly been identified as the lowest competitive pricing and fastest turnaround on delivery of these goods compared to the other supply vendors; and WHEREAS, the Purchasing Division has recently implemented several tools available through Amazon Business to manage spending controls within each City department and identify goods that should not be purchased through Amazon Business based on contractual agreements we already have in place with other vendors; and #12..
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3 NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves an increase for purchases from Amazon Business Marketplace pursuant to OMNIA Cooperative Contract with Prince William County Schools for an Online Marketplace for Products by the annual estimated amount of $205,000, for a revised annual estimated cost of $380,000, for a total revised amount not to exceed $2,417,581 over eight years.

BE IT FURTHER RESOLVED, that the Director of Finance, or her designee, is hereby authorized to issue the payment.
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4 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 28th day of February 2023, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: _____________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _____________________________
JOSE M. SANCHEZ, City Attorney
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CITY OF MODESTO

ADMINISTRATIVE

DIRECTIVE
Original Effective Date: 07/01/2019
Latest Revision Date: 05/11/2022

Policy Number: 7.28
Approved By: Joseph Lopez
City Manager
Subject: STANDARDIZATION OF OFFICE SUPPLIES FOR CITY-USE BY

UTILIZING THE LOWEST COST SUPPLIER

POLICY:

To establish a policy that provides the guidelines for standardization of office supplies for City business purchases by utilizing the lowest cost online marketplace supplier.

PURPOSE AND SCOPE:

Section 1
Amazon Business, Staples Advantage and Office Depot are online marketplaces that staff may utilize to purchase office supplies and breakroom/kitchen supplies.

Staff has the opportunity to determine which online marketplace to purchase necessary items from based on the lowest cost.

Section 1.2 - Approved categories of office supplies:
• Paper/Stationary (refer to City’s Administrative Directive 1.8 – Recycled Paper Products) o Copy Paper
o Color Printing Paper
o Notebooks/Notepads
o Cardstock
o Post-It’s/Sticky Notes
o Envelopes
• Toner & Ink
• Writing Supplies
o Pens
o Pencils
o Erasers & Correction
o Highlighters
• Folders & Filing
o File Folders
o Hanging File Folders
o File Storage
• Office Basics
o Clips, Fasteners & Rubber bands
o Staplers/Tape Dispenser/Scissors
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POLICY NO. 7.28

STANDARDIZATION OF OFFICE SUPPLIES FOR CITY-USE BY UTILIZING THE LOWEST COST

SUPPLIER

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o White-out & Correction Tape
o Binders
o Calculators
• Storage & Organization Supplies
• Boards/Easels
• Desktop Organizers
Section 1.3 - Paper products purchased must follow the 30% Recycled Paper Products requirement under Administrative Directive 1.8.

Section 2
Items prohibited for purchase from the Staples online marketplace include:
• Cleaning Supplies
• Paper products, facial tissue, soap, deodorizers, hand sanitizers, batteries • Office chairs/furniture
• Bottled Water
• Safety Vests/Goggles
Staff should utilize current agreements with Central Sanitary, Fastenal, and DS Services of America Inc. for items that have been through a bidding process and have contracted pricing.

Section 2.1 - Central Sanitary Oracle Agreement # 221423 -– Effective April 1, 2022 through August 7, 2022 and is now a non-catalog agreement with updated pricing. Original agreement #147851 was effective August 8, 2018 – March 31, 2021 (Two-year agreement with three 1-year extension options; have two available extension options). Original term of agreement remains the same.

The items that should be purchased from Central Sanitary include:
• Disinfectant Sprays
• Disinfectant Wipes
• Bleach
• Dish Soap
• Cleaners
• Deodorizers
• Brooms
• Facial Tissue
• Paper Towels
• Cups (hot & cold)
• Air Fresheners
• Hand Sanitizer
• Hand Cleaner
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POLICY NO. 7.28

STANDARDIZATION OF OFFICE SUPPLIES FOR CITY-USE BY UTILIZING THE LOWEST COST

SUPPLIER

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• Insect Spray
• Toilet Paper
Section 2.2 - Fastenal Vending Agreement #182558 - Effective October 1, 2018 – September 30, 2022 (Two-year agreement with three 1-year extension options; have two available extension options)
The items that should be purchased from Fastenal include:

NOTE: Purchases may be made without having a vending machine on site. • All Batteries (A, AA, AAA, C, D, 9 Volt)
• Hand wipes
• WD-40
• Clorox
• Glass Cleaner
• Air Fresheners
• Hand Sanitizer
• Gloves
• Safety Vests
• Safety Goggles
• Cleaners
• Tape Measure
Section 2.3 - DS Services of America Inc. Agreement #157381 - Effective April 23, 2019 – April 22, 2023 (Two-year agreement with three 1-year extension options; have two available extension options)
The items that should be purchased from DS Services America Inc. include:
• Bottled Water, 16.9 fl. oz. Case of 24
• Bottled Water, 16.0 fl. oz. Pallet/84 Cases
• Bottled Water, 5 Gallon Jugs
• Top Loading Water Cooler Hot/Cold for Rental
• Bottom Loading Water Cooler Hot/Cold for Rental
Nestle Waters North America Agreement #157054 – Effective April 23, 2019 – April 22, 2021 has been terminated.

Section 2.4 - Warden’s Agreement #160182 – Office chairs and furniture should be purchased from Warden’s Modesto, CA, when they have provided the lowest price. Purchases exceeding the $3,500 #12..
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POLICY NO. 7.28

STANDARDIZATION OF OFFICE SUPPLIES FOR CITY-USE BY UTILIZING THE LOWEST COST

SUPPLIER

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threshold will need to follow the purchasing process. Please coordinate with your department buyer to facilitate any purchases over $3,500.

Section 3
Shipping Charges:
• Amazon Business offers free 2-day shipping
• Staples Advantage offers free shipping for orders over $35 (pre-tax). Orders under $35 are charged $5 per shipping.
• Office Depot offers free shipping
Section 4
Payment:
• Amazon Business – Paid via P-Card, NO requisition required • Staples Advantage – Paid via AP against invoice (monthly), NO requisition required • Office Depot – Paid via AP against invoice (monthly), NO requisition required • Wardens Furniture Agreement – Paid via agreement, requisition required • Central Sanitary Supply – Paid via agreement, requisition required • Fastenal Vending Agreement – Paid via agreement, requisition required • DS Services Bottled Water Agreement – Paid via agreement, requisition required #12..
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CC VND 00015578 2023 TR
AMAZON CONFIDENTIAL Page 1 of 1

PARTICIPATING ADDENDUM
Prince William County Public Schools
This Participating Addendum (“Addendum”) is made and entered into effective as of the date you clickto-accept this Addendum (“Effective Date”) by and between City of Modesto (“you”) and Amazon.com Services LLC (“Amazon”).

WHEREAS, The U.S. Communities Government Purchasing Alliance (“USCGPA”) (now Omnia Partners) issued a request for proposals for an online marketplace for the purchases of products and services on behalf of Prince William County Public Schools (“PWCS”). USCGPA posted the solicitation on its website, Onvia/DemandStar, Prince William County Public Schools, and Canadian MERX Public Tenders on September 14, 2016 through October 14, 2016. USCGPA also posted the solicitation in the Oregon Daily Journal of Commerce on September 16, 19, 21, 23, 26, 28, and 30, 2016; in the Hawaii Tribune-Herald on September 17 through September 23, 2016; and in the Gainesville Times and Prince Williams Times on September 21, 2016, all newspapers of general circulation. As the deadlines for proposals was October 14, 2016, the advertisements occurred at least ten days before the proposal due date.

WHEREAS, On January 29, 2017, based on the results of the competitive process, PWCS, the administering agent on behalf of USCGPA, entered into a contract with Amazon entitled “Online Marketplace for the Purchase of Products and Services” identified as Amazon Business Contract No. R-TC-17006 (“Contract”).

WHEREAS, On December 1, 2021 PWCS and Amazon executed the first of three (3) additional two (2) year extension options and renewed the Contract for the period of January 19, 2022 to January 18, 2024.

AGREEMENT
Scope of Work: Per Omnia/U.S. Communities and PWCS Contract No. R-TC-17006 (https://public.omniapartners.com/suppliers/amazon-business/contract-documentation#c36074).

Incorporation: This Addendum shall fully incorporate the Contract which the parties agree is true and correct.

Term of Addendum: This Addendum is effective as of the Effective Date for a term extending through January 18, 2024. The Contract may be extended for two (2) additional two (2) year periods at the election of PWCS. If PWCS elects to extend the Contract, this Addendum will automatically extend as well.

Applicable Law: Participating Public Agencies may purchase Products and Services on the same terms, conditions, and pricing as the Lead Public Agency, subject to any applicable local purchasing ordinances and the laws of the State of purchase.

By clicking “I accept”, you confirm that you have read, agree to, and have the authority to agree to this Addendum on behalf of the organization you represent.
____________________________ ___________________
City Manager Date
City of Modesto
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

February 28, 2023
Date: January 24, 2023
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
SUBJECT: Municipal Advisory Services Agreement
CONTACT: Dianne Love, Senior Buyer, [email protected], 209-571-5164 DESCRIPTION:

Consider approving the Award of Proposal and Agreements to Public Financial Management (PFM) Financial Advisors LLC, San Francisco, California, for Municipal Advisory Services and PFM Swap Advisors LLC, San Francisco, California, for Annual Derivative Valuation Report for a total amount not to exceed $900,000 over the six years, rescinding Resolution 2022-335. (Funding Source: Various Funds)
STRATEGIC PLAN ELEMENT:

These items support the City of Modesto 2020-2025 Strategic Plan Focus of Governance and Service Delivery under goal H: Achieve Financial Sustainability.

BACKGROUND:

Under Municipal Code Section 8-4.301, the City may issue bonds or refund bonds based on the financing needs for the City which will, in the long-term, benefit the City’s debt financing portfolio strategy. The City utilizes a municipal advisory services company to assist in monitoring the City’s debt portfolio of over $339 million in a fiduciary capacity with oversight by the Director of Finance. This agreement will assist the City in identifying the best financing strategies to optimize the lowest financing cost based on the guidelines defined under the City’s Debt Management Policy and State statutes. These services include the following:

1. Services related to the Financial Planning and Policy Development upon request of the City and as directed by the City Manager or his designee.

2. Assist in the annual updating of our Debt Management Policy to ensure revisions are based on new regulatory requirements.

3. Review existing debt for the possibility of refunding debt to generate savings.

4. Analyze financial and economic factors to determine if the issuance of bonds is appropriate.

5. Review the terms, conditions and structure of any proposed debt offering undertaken by the City and provide suggestions, modifications, and #13..
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City Council, February 28, 2023
Municipal Advisory Services Agreement

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enhancements where appropriate and necessary to reflect the constraints or current financial policy and fiscal capability.

6. Assist with credit rating presentations including review and comment on presentation strategies and content.

7. Assist with the procurement of other services relating to debt issuance such as underwriting services, printing, paying agent, registrar, trustee, etc.

8. As applicable, advise the City on the condition of the bond market at the time of sale, including volume, timing considerations, competing offerings, and general economic considerations.

9. Produce annually derivative and investment valuation reports to manage the City’s variable debt portfolio and comply with accounting requirements defined under Government Account Standards Board (GASB).

10. Assist in creating and updating the Unfunded Pension Liability Policy to ensure the City is following best practices.

11. Monitoring the City’s Unfunded Accrued Liability with CalPERS and recommending actions on responding to future increases.

On August 9, 2022, by Resolution No. 2022-335, Council approved the Agreements to Public Financial Management (PFM) Financial Advisors LLC, San Francisco, California, for Municipal Advisory Services and PFM Swap Advisors LLC, San Francisco, California, for Annual Derivative Valuation Report for two (2) years with three (3) one-year extension options at a combined estimated annual amount of $150,000 and a total combined amount not to exceed $750,000 over the five years.

DISCUSSION:

When the City completed the formal bidding process and presented the two Agreements to Council, the term period was defined as a period of three (3) years with three (3) one-year extension options for a total of six years. Unfortunately, when the Council agenda report and Resolution was presented to Council on August 9, 2022, there was a technical error and the term period referenced in these two documents include a term period of two (2) years with three (3) one-year extension options for a total of five years. The Attachments included on this agenda item include the correct term period which are included as part of this item. City staff is recommending to rescind Resolution #2022-335 to correct this error and establish the correct term period as defined under the Request for Proposal (RFP) documents and executed Agreements.

FISCAL IMPACT:

No changes have been made to the Agreements based on what was originally approved by Council on August 9, 2022, but staff have captured the details of the fiscal impact of the overall agreements. In Fiscal Year 2022-2023, the city will have to solicit two Letter of Credit agreements for our 2008 Lease Revenue Bonds and 2008 Certificate of Participation Water Bonds which we anticipate will cost the city around $30,000-$50,000 per agreement.

Additionally, in the near future new bond issuance will be needed for various utility capital projects during the term of this new agreement. The City shall pay PFM the following hourly rates for services based on the debt financing needs of the organization for the various services performed during each fiscal year which range about $5,200 per month.

The annual preparation of Annual Derivative Valuation report will cost $11,500 annually which is attributed to our variable swap debt.
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City Council, February 28, 2023
Municipal Advisory Services Agreement

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The hourly rates based on the work performed by PFM shall be:
 Managing Director - $350
 Director - $300
 Senior Managing Consultant - $275
 Senior Analyst - $250
 PFM Analyst - $225
The cost for these fees will be funded utilizing the same funding source that is being used to fund the current bond expenses. The current bond structure is funded by the General Fund, Redevelopment Successor Agency, Water, Wastewater, and Golf so if any debt financing occurs which will generate the cost related to these services the funding would come from these funding sources. In addition, if any savings are generated from any debt refunding it would be accounted for under the same funding sources. If any new bonds are issued the cost will be included as part of the bond issuance cost and these costs will be funded based on the department who will be utilizing the bond funding.

COMMITTEE RECOMMENDATION:

This item was presented at the January 23, 2023, Finance Committee and approved to move forward to Council.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving the Award of Proposal and Agreements to Public Financial Management (PFM) Financial Advisors LLC, San Francisco, California, for Municipal Advisory Services and PFM Swap Advisors LLC, San Francisco, California, for Annual Derivative Valuation Report for a total amount not to exceed $900,000 over the six years, rescinding Resolution 2022-335; and authorizing the City Manager or his designee to execute the Agreement.

Approved by:

DeAnna Christensen, Director of Finance
Joseph P. Lopez, City Manager
Attachments:

1. Resolution

2. PFM Municipal Advisory Agreement

3. Swap Services Agreement

4. Exhibit B – PFM Proposal

5. Exhibit C – RFP 2122-01
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1 MODESTO CITY COUNCIL
RESOLUTION NO. 2023-

RESOLUTION APPROVING THE AWARD OF PROPOSAL AND

AGREEMENTS TO PUBLIC FINANCIAL MANAGEMENT (PFM) FINANCIAL

ADVISORS LLC, SAN FRANCISCO, CALIFORNIA, FOR MUNICIPAL

ADVISORY SERVICES AND PFM SWAP ADVISORS LLC, SAN FRANCISCO,

CALIFORNIA, FOR ANNUAL DERIVATIVE VALUATION REPORT FOR A TOTAL AMOUNT NOT TO EXCEED $900,000 OVER THE SIX YEARS, RESCIDNING RESOLUTION 2022-335; AND AUTHORIZING THE CITY

MANAGER OR HIS DESIGNEE TO EXECUTE THE AGREEMENT
WHEREAS, under Municipal Code Section 8-4.301, the City may issue bonds or refund bonds based on the financing needs for the City which will, in the long-term, benefit the City’s debt financing portfolio strategy; and WHEREAS, the City utilizes a municipal advisory services company to assist in monitoring the City’s debt portfolio of over $371 million in a fiduciary capacity with oversight by the Director of Finance; and
WHEREAS, this agreement will assist the City in identifying the best financing strategies to optimize the lowest financing cost based on the guidelines defined under the City’s Debt Management Policy and State statutes; and
WHEREAS, on August 9, 2022, by Resolution No. 2022-335, Council approved the Agreements to Public Financial Management (PFM) Financial Advisors LLC, San Francisco, California, for Municipal Advisory Services and PFM Swap Advisors LLC, San Francisco, California, for Annual Derivative Valuation Report for two (2) years with three (3) one-year extension options at a combined estimated annual amount of $150,000 and a total combined amount not to exceed $750,000 over the five years; and #13..
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2 WHEREAS, when the City completed the formal bidding process and presented the two Agreements to Council, the term period was defined as a period of three (3) years with three (3) one-year extension options for a total of six years; and WHEREAS, when the Council agenda report and Resolution was presented to Council on August 9, 2022 there was a technical error and the term period referenced in these two documents include a term period of two (2) years with three (3) one-year extension options for a total of five years; and
WHEREAS, City staff is recommending to rescind Resolution #2022-335 to correct this error and establish the correct term period as defined under the Request for Proposal (RFP) documents and executed Agreements.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the Award of Proposal and Agreements to Public Financial Management (PFM) Financial Advisors LLC, San Francisco, California, for Municipal Advisory Services and PFM Swap Advisors LLC, San Francisco, California, for Annual Derivative Valuation Report for a total amount not to exceed $900,000 over the six years, rescinding Resolution 2022-335.

BE IT FURTHER RESOLVED, that the City Manager, or his designee, is hereby authorized to execute the agreements, in a form approved by the City Attorney. #13..
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3 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 28th day of February 2023, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: _____________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _____________________________
JOSE M. SANCHEZ, City Attorney
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1 STANDARD AGREEMENT

FOR MUNICIPAL ADVISORY SERVICES

WITH PFM FINANCIAL ADVISORS LLC
This Agreement, made and entered into in the City of Modesto, State of California, this ____ day of ____________, 2022, by and between the City of Modesto, a municipal corporation of the State of California, hereinafter called CITY, and PFM Financial Advisors LLC, hereinafter called CONTRACTOR.

W I T N E S S E T H:

WHEREAS, the Modesto City Council adopted Resolution No. 2022-_____ authorizing the award of proposal and contract for the furnishing of Municipal Advisory Services and Annual Derivative Valuation Report to Contractor, attached hereto as Exhibit “A” and made a part hereof; and
WHEREAS, the CONTRACTOR provided a responsive and responsible submittal that best meets the CITY needs, attached hereto as Exhibit “B” and made a part hereof; and WHEREAS, the CITY and CONTRACTOR shall enter into an agreement for the furnishing of MUNICIPAL ADVISORY SERVICES, as described in RFP No. 2122-01 – MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT, attached hereto as Exhibit “C” and made a part hereof.

NOW, THEREFORE, the parties hereto mutually agree as follows:

1. SCOPE OF WORK.
a. CONTRACTOR shall furnish MUNICIPAL ADVISORY
SERVICES insofar as such scope of services are specified in Exhibit “D” attached hereto and made a part hereof, and in strict accordance with the conditions of the complete Agreement. b. CONTRACTOR shall do and perform the work contemplated

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2 hereby in a good and workmanlike manner under the direction of and to the satisfaction of the City Representative $138,500 annually:

Description Unit Price
Municipal Advisory Services (Hourly Rate)
Managing Director $350
Director $300
Senior Managing Consultant $275
Senior Analyst $250
Analyst $225
Additional Services (Please specify)
Bond issuances would be billed at a fixed rate based on the nature and complexity of the financing, subject to agreement with the City at the outset of the transaction.

2. CITY REPRESENTATIVE:

Contract Administrator is:

Dianne Love (209) 571-5164 [email protected] The City Representative is not authorized to commit the CITY to changes in specifications, requirements, or scope of work, changes in price(s), period of performance or delivery date(s) or method of shipment. Changes of a contractual or business nature shall be effected only by written change to this Agreement, issued by the City of Modesto, Purchasing Division.

3. TERM:

The term of this Agreement shall be for a period of three (3) years, with three (3) one-year extension options at the sole discretion of CITY, for a total of up to six (6) years.

Year 1: October 3, 2022 through October 2, 2023
Year 2: October 3, 2023 through October 2, 2024
Year 3: October 3, 2024 through October 2, 2025
Year 4: October 3, 2025 through October 2, 2026
Year 5: October 3, 2026 through October 2, 2027
Year 6: October 3, 2027 through October 2, 2028

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3 Pricing as set forth in Section 1.c. above shall remain firm for the first three (3) years of this Agreement.

Price increases for subsequent contract years, four, five and six shall not exceed the Consumer Price Index (CPI) for West Urban Area in any one contract year and shall be negotiated through the Purchasing Division. Requests for price increases shall be submitted by CONTRACTOR in writing, sixty (60) days prior to the annual anniversary date of this Agreement to be effective for the subsequent year.

4. LIABILITY INSURANCE:

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4 the following coverages and indicate the policy aggregate limit applying to:
premises and operations; broad form contractual; products and completed operations as applicable.
(c) Automobile Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover hired and/or non-owned automobile for bodily injury and property damage.
(d) Professional Liability - insurance with a minimum limit of $1,000,000 per claim and $2,000,000 policy aggregate. If coverage is on a claims-made basis it shall be maintained for at least three (3) years following completion of the work.

If at any time any of said policies shall be unsatisfactory to CITY, as to form or substance, or if a company issuing such policy shall be unsatisfactory to CITY, CONTRACTOR shall promptly obtain a new policy, submit the same to Risk Manager of CITY for approval and submit a certificate thereof as herein above provided. Upon failure of CONTRACTOR to furnish, deliver or maintain such insurance and certificates as above provided, this Agreement, at the election of CITY, may be forthwith declared suspended, or terminated. Failure of CONTRACTOR to obtain and/or maintain any required insurance shall not relieve CONTRACTOR from any liability under this Agreement, nor shall the insurance requirements be construed to conflict with or otherwise limit the obligations of CONTRACTOR concerning indemnification. CITY, and its agents, officers, employees, and volunteers shall be named as an additional insured on all insurance policies required herein, except Workers’ Compensation, Professional Liability and Financial Institution’s Fidelity. The Workers’ Compensation insurer shall agree to waive all rights of subrogation against CITY, its agents, officers, employees, and volunteers for losses arising from work performed by CONTRACTOR for CITY.

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5 CONTRACTOR’S insurance policy(ies) shall include a provision that the coverage is primary as respects CITY; shall include no special limitations to coverage provided to additional insured; and, shall be placed with insurer(s) with acceptable Best’s rating of A:VII or with approval of the Risk Manager of CITY. The CONTRACTOR must deliver certificates evidencing existence of the insurance to the City prior to the time contract is signed.

CONTRACTOR agrees to provide CITY with a separate endorsement evidencing proof of City’s additional insured status required herein (both general and automobile liability) as well as a separate endorsement for the Workers’ Compensation insurer’s waiver of all subrogation rights as stated above. Every endorsement shall identify the policy number.

For any claims related to this project, the CONTRACTOR’S insurance coverage shall be primary insurance as respects the Entity, its officers, officials, employees, and volunteers.

Any insurance or self-insurance maintained by the Entity, its officers, officials, employees, or volunteers shall be excess of the CONTRACTOR’S insurance and shall not contribute with it.

At the time of renewal or amendment, CONTRACTOR further agrees that the amount of insurance required may from time to time be adjusted by CITY’s Risk Manager and CONTRACTOR agrees to file a new insurance certificate with CITY’s Risk Manager evidencing the new amounts after a thirty (30) day written notice from CITY’s Risk Manager.

5. INDEMNITY:

The CONTRACTOR shall hold the CITY, its agents, officers, employees, and volunteers, harmless from and save, defend and indemnify them against any and all claims, losses, liabilities, judgments or damages from every cause, including but not limited to injury to person or property or wrongful death, including reasonable costs and expenses of defense of any judicial or administrative action, arising directly out of any negligent or intentionally wrongful act or omission of CONTRACTOR, or its agents, officers, employees, or volunteers relating to or during the performance of its obligations under this Agreement.

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6 CONTRACTOR’s obligation to defend, indemnify, and hold the CITY, its agents, officers, and employees harmless under the provisions of this paragraph is not limited to or restricted by any requirement in this Agreement for CONTRACTOR to procure and maintain a policy of insurance.

7. GOVERNING LAW:

This Agreement shall be deemed made in, governed by, performed in, and construed and enforced in accordance with the laws of the State of California, without giving effect to its conflicts of laws provisions or principles.

Venue for any dispute arising out of this Agreement shall be the Superior Court of Stanislaus County.

8. COMMENCEMENT AND COMPLETION OF THE WORK:

The work contemplated herein shall be commenced as set forth in Section 3. Proof of insurance (approved by Risk Management), business license, executed agreement and all exhibits shall be valid and received by City prior to any work being commenced.

9. TERMINATION OF SERVICES:

Termination by City for Default of Contractor
Should Contractor default in the performance of this Agreement or materially breach any of its provisions, at its option, City may terminate this Agreement by giving written notification to Contractor. The termination date shall be the effective date of the notice. For the purposes of this section, material breach of this Agreement shall include, but not be limited to, any of the following: failure to perform required services or duties, willful destruction of City's property by Contractor, dishonesty or theft.

Termination by City for Convenience
The City may also terminate the Contractor's performance under this Agreement, either in whole or in part, at its own discretion, or when conditions encountered during the Work make it

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7 impossible or impracticable to proceed, or when the City is prevented from proceeding with this Agreement by act of God, by law, or by official action of a public authority, or upon a determination by the City that such termination is in the best interest and convenience of the City, or whenever the City is prohibited from completing the Work for any reason. The City shall provide no less than ten (10) calendar day’s written notice of its intent to terminate this Agreement for convenience, and shall endeavor to provide the Contractor with consultation with the City prior to termination.

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8 e. Settle outstanding liabilities and claims, subject to the approval of City; f. Complete performance of such part of the Work as has not been terminated; g. Take such other actions as may be necessary, or as may be directed by the City for the protection and preservation of the Work and/or property related to the Work;
h. If City so requests, and at City's cost, Contractor shall provide sufficient oral or written status reports to make City reasonably aware of the status of Contractor's work on the project.
i. The Contractor understands and agrees that City may, in City's sole discretion, refuse to pay Contractor for that portion of Contractor's services which were performed by Contractor on the project prior to the termination date and which remain unacceptable and/or not useful to City as of the termination date.

City will pay Contractor an amount based on the percentage of satisfactory work completed in accordance with the notice of termination. The final payment to the Contractor after termination for convenience shall be limited to amounts due and owing under this Agreement at time of termination, including the following:
a. The cost of settling and paying valid claims arising out of the termination of the Work such as subcontractor agreements or contracts for materials; b. The Agreement price allocable to the portion of the Work properly performed or goods supplied to the work site by the Contractor as of the date of termination, as determined in accordance with the notice of termination, reduced by any sums previously paid to the Contractor.

Authorization to Terminate Agreement

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9 Termination of this Agreement may be invoked by the City Manager, or his/her designee, subject to the right of the Contractor to appeal the City Manager, or his/her designee’s, decision to the City Council. The Contractor shall appeal by notifying the City Clerk in writing within ten (10) calendar days of receipt of written notification from City of termination of this Agreement. In the event that termination of this Agreement is upheld by the City Council, any cessation of payment of delay claims, extended claims, Eichleay claims, or any other claims for delay shall be retroactive to the date of termination selected by the City Manager, or his/her designee.

10. COMPLIANCE WITH ALL LAWS:

CONTRACTOR hereby agrees that CONTRACTOR and its subcontractors, if any, in the performance of the work described, designated and shown upon the plans herein referred to, will comply with all federal, state, county and municipal laws, rules and regulations which may be applicable to the work herein contracted for, whether now in existence or hereafter adopted.

11. CONTRACT DOCUMENTS:

The complete contract between the parties hereto consists of this Agreement and the following documents which are incorporated herein by this reference:
a. Resolution No. 2022-_______;
b. CONTRACTOR submittal;
c. RFP No. 2122-01 – Municipal Advisory Services and Annual Derivative Valuation Report;
d. Scope of Work (Exhibit D);
e. Insurance Certificates,
These documents include important legal requirements, procedures and restrictions and should be reviewed by CONTRACTOR. They are available for review during normal business hours in the Department of Finance, Purchasing Division). All documents specified above are

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10 intended to operate so that any work called for in any one and not mentioned in the other, or vice versa, is to be executed the same as if mentioned in all said documents.

12. NOTICES:

Any notice, payment or instrument required or permitted by this Agreement to be given or delivered to either party shall be deemed to have been received when personally delivered, or one calendar week following deposit of the same in any United States Post Office, registered or certified mail, postage prepaid, addressed as follows:

CONTRACTOR: PFM Financial Advisors LLC
Attn: Sarah Hollenbeck
44 Montgomery Street, 3rd Floor
San Francisco, CA 94104

CITY: City of Modesto
Purchasing Division
P.O. Box 642
Modesto, CA 95353

Each party may change its address for delivery of notice by delivering written notice of such change of address to the other party.

13. SIGNATOR(IES) FOR CONTRACTOR:

The undersigned signator(ies) for CONTRACTOR warrant(s) and represent(s) that he/she/they is/are legally competent to execute this Agreement and has/have full authority to execute this Agreement.

14. ASSIGNMENT:

Neither this Agreement nor any portion thereof shall be subcontracted or assigned without the written consent of the CITY in each and every instance.

15. WAIVER:

The waiver by any party to this Agreement of a breach of any provision hereof shall be in writing and shall not operate or be construed as a waiver of any other or subsequent breach hereof unless specifically stated in writing.

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11 16. HEADINGS NOT CONTROLLING:

Headings used in this Agreement are for reference purposes only and shall not be considered in construing this Agreement.

17. MISCELLANEOUS:

Time is of the essence in every provision of this Agreement.

18. REGISTERED MUNICIPAL ADVISOR; REQUIRED DISCLOSURES
Contractor is a registered municipal advisor with the Securities and Exchange Commission (the “SEC”) and the Municipal Securities Rulemaking Board (the “MSRB”), pursuant to the Securities Exchange Act of 1934 Rule 15Ba1-2. The parties agree that if City has designated Contractor as its independent registered municipal advisor (“IRMA”) for purposes of SEC Rule 15Ba1-1(d)(3)(vi) (the “IRMA exemption”), the services provided pursuant to such designation shall be the services described in Exhibit D hereto, subject to any limitations provided therein. Verification of independence (as is required under the IRMA exemption) shall be the responsibility of such third party seeking to rely on such IRMA exemption. Contractor shall have the right to review and approve in advance any representation of Contractor’s role as IRMA to City.

MSRB Rules require that municipal advisors make written disclosures to their clients of all material conflicts of interest, certain legal or disciplinary events and certain regulatory requirements, which are provided in Contractor’s Disclosure Statement delivered to City prior to or together with this Agreement.

19. OTHER SERVICES
Upon request of City, an affiliate of Contractor or a third party referred or otherwise introduced by Contractor may agree to additional services to be provided by such affiliate or third party, by a separate writing, including separate scope and compensation, between City and such affiliate or third party. For the sake of clarity, any separate agreement

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12 between City and an affiliate or third party shall not in any way be deemed an amendment or modification of this Agreement.

20. INFORMATION TO BE FURNISHED TO CONTRACTOR
All information, data, reports, and records in the possession of City or any third party necessary for carrying out any services to be performed under this Agreement (“Data”) shall be furnished to Contractor. Contractor may rely on the Data in connection with its provision of the services under this Agreement and the provider thereof shall remain solely responsible for the adequacy, accuracy or completeness of such Data. 21. ENTIRE AGREEMENT:

This Agreement and its exhibits contain the entire understanding between Contractor and City. Additional or new terms contained in this Agreement which vary from Contractor’s proposal are controlling and are deemed accepted by Contractor by shipment of any article or other commencement of performance hereunder. All previous proposals, offers and communications relative to this Agreement, whether oral or written, are hereby superseded except to the extent that they have been incorporated into this Agreement. No future waiver or exception to any of the terms, conditions, and provisions of this Agreement shall be considered valid unless specifically agreed to in writing by all the parties.

22. PARTIAL INVALIDITY:

If any provision in this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way.

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13 WITNESS WHEREOF, the CITY OF MODESTO, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attested by its City Clerk under authority of Resolution No. 2022-_______, adopted by the Council of the City of Modesto on the _____________ day of _____________________, 2022 and PFM FINANCIAL ADVISORS, LLC has caused this Agreement to be duly executed.

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14 Exhibit D

SCOPE OF WORK

1. Services related to the Financial Planning and Policy Development. Upon request of the CITY, CONTRACTOR’s services may include:  Assist the CITY in the formulation of Financial and Debt Policies and Administrative Procedures.  Review current debt structure, identifying strengths and weaknesses of structure so that future debt issues can be designed to maximize ability to finance future capital needs. This will include, but not be limited to, reviewing existing debt for the possibility of refunding that debt to provide the CITY with savings.  Analyze future debt capacity to determine the CITY’s ability to raise future debt capital.  Assist the CITY in the development of the CITY’s Capital Improvement Program by identifying sources of capital funding.  Assist the CITY with the development of the CITY’s financial planning efforts and process by assessing capital needs, identifying potential revenue sources, analyze financing alternatives such as pay-as-you-go, lease/purchasing, short-term vs. longterm financings, assessments, user fees, impact fees, developer contributions, public/private projects and grants, and provide analysis of each alternative as required as to the budgetary and financial impact.  Review the reports of accountants, independent engineers and other project feasibility consultants to ensure that such studies adequately address technical, economic, and financial risk factors affecting the marketability of any proposed revenue debt issues; provide bond market assumptions necessary for financial projections included in these studies; attend all relevant working sessions regarding

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15 the preparations, review and completion of such independent studies; and provide written comments and recommendations regarding assumptions, analytic methods, and conclusions contained therein.  Develop, manage and maintain computer models for long-term capital planning which provide for inputs regarding levels of ad valorem and non-ad valorem taxation, growth rates by operating revenue and expenditure item, timing, magnitude and cost of debt issuance, and project operating and capital balances, selected operating and debt ratios and other financial performance measures as may be determined by the CITY.  Conduct strategic modeling and planning and related consulting.  Attend meetings with CITY’s staff, consultants and other professionals and the CITY.  Undertake financial planning and policy development assignments made by the CITY regarding financings, and financial policy including budget, tax, cash management issues and related fiscal policy and programs.  Assist the CITY in preparing financial presentations for public hearings and/ or referendums.  Provide special financial services as requested by the CITY.

2. Services Related to Debt Transactions. Upon the request of the CITY, CONTRACTOR’s services may include:  Analyze financial and economic factors to determine if the issuance of bonds is appropriate.  Develop a financing plan in concert with CITY’s staff which would include recommendations as to the timing and number of series of bonds to be issued.

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16  Assist the CITY by recommending the best method of sale, either as a negotiated sale, private placement or a competitive sale.  Advise as to the various financing alternatives available to the CITY.  Develop alternatives related to debt transaction including evaluation of revenues available, maturity schedule and cash flow requirements.  Evaluate benefits of bond insurance and/or security insurance for debt reserve fund.  If appropriate, develop credit rating presentation and coordinate with the CITY the overall presentation to rating agencies.  Review underwriter’s proposals and submit a written analysis of same to the CITY.  Assist the CITY in the procurement of other services relating to debt issuance such as printing, paying agent, registrar, etc.  Identify key bond covenant features and advise as to the financial consequences of provisions to be included in bond indentures, resolutions or other governing documents regarding security, creation of reserve funds, flow of funds, redemption provisions, additional parity debt tests, etc.; review and comment on successive drafts of bond governing documents.  Review the requirements and submit analysis to bond insurers, rating agencies and other professionals as they pertain to the CITY’s obligation.  Review the terms, conditions and structure of any proposed debt offering undertaken by the CITY and provide suggestions, modifications and enhancements where appropriate and necessary to reflect the constraints or current financial policy and fiscal capability.  Coordinate with CITY’s staff and other advisors as respects the furnishing of data for offering documents, it being specifically understood that CONTRACTOR is not

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17 responsible for the inclusion or omission of any material in published offering documents.  As applicable, advise the CITY on the condition of the bond market at the time of sale, including volume, timing considerations, competing offerings, and general economic considerations.  Assist and advise the CITY in negotiations with investment banking groups regarding fees, pricing of the bonds and final terms of any security offering, and make recommendations regarding a proposed offering to obtain the most favorable financial terms based on existing market conditions. If the transaction is competitive, the services of the financial advisor will be modified to reflect that process.  Arrange for the closing of the transaction including, but not limited, to bond printing, signing and final delivery of the bonds.

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CITY OF MODESTO,
a municipal corporation
BY: ____________________________
JOSEPH P. LOPEZ, City Manager
ATTEST:
(Seal)
BY: ____________________________

DIANE NAYARES-PEREZ, CMC,
City Clerk
________________________________ BY: ____________________________ By _____________________________
Name Title
BY: ____________________________
By _____________________________
Name Title
APPROVED AS TO FORM:

BY: ____________________________
JOSE M. SANCHEZ, City Attorney
APPROVED AS TO FORM:

BY: ____________________________
JOE F. RODRIGUEZ, Risk Manager
Federal ID # ___________

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1 STANDARD AGREEMENT

FOR ANNUAL DERIVATIVE VALUATION REPORT

WITH PFM SWAP ADVISORS LLC
This Agreement, made and entered into in the City of Modesto, State of California, this ____ day of ______________, 2022, by and between the City of Modesto, a municipal corporation of the State of California, hereinafter called CITY, and PFM Swap Advisors LLC, hereinafter called CONTRACTOR.

W I T N E S S E T H:

WHEREAS, the Modesto City Council adopted Resolution No. 2022-_____ authorizing the award of proposal and contract for the furnishing of Municipal Advisory Services and Annual Derivative Valuation Report to Contractor, attached hereto as Exhibit “A” and made a part hereof; and
WHEREAS, the CONTRACTOR provided a responsive and responsible submittal that best meets the CITY needs, attached hereto as Exhibit “B” and made a part hereof; and WHEREAS, the CITY and CONTRACTOR shall enter into an agreement for the furnishing of ANNUAL DERIVATIVE VALUATION REPORT, as described in RFP No. 2122- 01 – MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT, attached hereto as Exhibit “C” and made a part hereof; and NOW, THEREFORE, the parties hereto mutually agree as follows:

1. SCOPE OF WORK.
a. CONTRACTOR shall furnish ANNUAL DERIVATIVE
VALUATION REPORT insofar as such scope of services are specified in Exhibit “D” attached hereto and made a part hereof, and in strict accordance with the conditions of the complete Contract.
b. CONTRACTOR shall do and perform the work contemplated

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2 hereby in a good and workmanlike manner under the direction of and to the satisfaction of the City Representative.
c. CONTRACTOR shall furnish said services at the following contracted rates, estimated amount of $11,500 annually:

Description Unit Price
Preparation of Annual Derivative Valuation Report (Annual Rate) $11,500

2. CITY REPRESENTATIVE:

Contract Administrator is:

Dianne Love (209)571-5164 [email protected] The City Representative is not authorized to commit the CITY to changes in specifications, requirements, or scope of work, changes in price(s), period of performance or delivery date(s) or method of shipment. Changes of a contractual or business nature shall be affected only by written change to the contract, issued by the City of Modesto, Purchasing Division.

3. TERM:

The term of this Agreement shall be for a period of three (3) years, with three (3) one-year extension options at the sole discretion of CITY, for a total of up to six (6) years.

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3 Pricing as set forth in Section 1.c. above shall remain firm for the first three (3) years of the contract.

4. LIABILITY INSURANCE:

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4 premises and operations; broad form contractual; products and completed operations as applicable.
(c) Automobile Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover hired and/or non-owned automobiles for bodily injury and property damage.
(d) Professional Liability insurance with a minimum limit of $1,000,000 per claim and $2,000,000 policy aggregate. If coverage is on a claims-made basis it shall be maintained for at least three (3) years following completion of the work.

CONTRACTOR’S insurance policy(ies) shall include a provision that the coverage is primary as

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5 respects CITY; shall include no special limitations to coverage provided to additional insured; and, shall be placed with insurer(s) with acceptable Best’s rating of A:VII or with approval of the Risk Manager of CITY. The CONTRACTOR must deliver certificates evidencing existence of the insurance to the City prior to the time contract is signed.

For any claims related to this project, the CONTRACTOR’S insurance coverage shall be primary insurance as respects the Entity, its officers, officials, employees, and volunteers.

Any insurance or self-insurance maintained by the Entity, its officers, officials, employees, or volunteers shall be excess of the CONTRACTOR’S insurance and shall not contribute with it.

5. INDEMNITY:

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6 CONTRACTOR’s obligation to defend, indemnify, and hold the CITY, its agents, officers, and employees harmless under the provisions of this paragraph is not limited to or restricted by any requirement in this Agreement for CONTRACTOR to procure and maintain a policy of insurance.

7. GOVERNING LAW:

Venue for any dispute arising out of this Agreement shall be the Superior Court of Stanislaus County.

8. COMMENCEMENT AND COMPLETION OF THE WORK:

9. TERMINATION OF SERVICES:

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7 impossible or impracticable to proceed, or when the City is prevented from proceeding with the Agreement by act of God, by law, or by official action of a public authority, or upon a determination by the City that such termination is in the best interest and convenience of the City, or whenever the City is prohibited from completing the Work for any reason. The City shall provide no less than ten (10) calendar day’s written notice of its intent to terminate this Agreement for convenience, and shall endeavor to provide the Contractor with consultation with the City prior to termination.

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8 e. Settle outstanding liabilities and claims, subject to the approval of City; f. Complete performance of such part of the Work as has not been terminated; g. Take such other actions as may be necessary, or as may be directed by the City for the protection and preservation of the Work and/or property related to the Work;
h. If City so requests, and at City's cost, Contractor shall provide sufficient oral or written status reports to make City reasonably aware of the status of Contractor's work on the project.
i. The Contractor understands and agrees that City may, in City's sole discretion, refuse to pay Contractor for that portion of Contractor's services which were performed by Contractor on the project prior to the termination date and which remain unacceptable and/or not useful to City as of the termination date.

Authorization to Terminate Agreement

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9 Termination of this Agreement may be invoked by the City Manager, or his/her designee, subject to the right of the Contractor to appeal the City Manager, or his/her designee’s, decision to the City Council. The Contractor shall appeal by notifying the City Clerk in writing within ten (10) calendar days of receipt of written notification from City of termination of this Agreement. In the event that termination of this Agreement is upheld by the City Council, any cessation of payment of delay claims, extended claims, Eichleay claims, or any other claims for delay shall be retroactive to the date of termination selected by the City Manager, or his/her designee.

10. COMPLIANCE WITH ALL LAWS:

11. CONTRACT DOCUMENTS:

These documents include important legal requirements, procedures and restrictions and should be reviewed by CONTRACTOR. They are available for review during normal business hours in the Department of Finance, Purchasing Division). All documents specified above are

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10 intended to operate so that any work called for in any one and not mentioned in the other, or vice versa, is to be executed the same as if mentioned in all said documents.

12. NOTICES:

CONTRACTOR: PFM Swap Advisors LLC
Attn: Alfred Mukunya
1735 Market Street, 42nd Floor
Philadelphia, PA 19103

CITY: City of Modesto
Purchasing Division
P.O. Box 642
Modesto, CA 95353

Each party may change its address for delivery of notice by delivering written notice of such change of address to the other party.

13. SIGNATOR(IES) FOR CONTRACTOR:

The undersigned signator(ies) for CONTRACTOR warrant(s) and represent(s) that he/she/they is/are legally competent to execute this Agreement and has/have full authority to execute this contract.

14. ASSIGNMENT:

Neither this Agreement nor any portion thereof shall be subcontracted or assigned without the written consent of the CITY in each and every instance.

15. WAIVER:

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11 16. HEADINGS NOT CONTROLLING:

Headings used in this Agreement are for reference purposes only and shall not be considered in construing this Agreement.

17. MISCELLANEOUS:

Time is of the essence in every provision of this Agreement.

18. ADDITIONAL DISCLOSURES:

Contractor agrees that it will not deal with itself or with any other affiliated company or individual in making purchases or sales of the Swap(s) or any securities pursuant to this engagement, nor will we take a long or short position in securities subject to purchase or sale in connection with the Swap(s). Contractor confirms that it has no interest in the purchase or sale of the Swap(s) other than as described in this Agreement.

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12 21. ENTIRE AGREEMENT:

22. PARTIAL INVALIDITY:

WITNESS WHEREOF, the CITY OF MODESTO, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attested by its City Clerk under authority of Resolution No. 2022-_______, adopted by the Council of the City of Modesto on the _____________ day of _____________________, 2022 and PFM SWAP ADVISORS LLC has caused this Agreement to be duly executed.

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13 Exhibit D

SCOPE OF WORK
CONTRACTOR will perform calculations relating to the valuation of certain interest rate exchange agreements, which may include swaps, swaptions, caps, floors, or other similar contracts. The calculations are to be performed with respect to all swap transactions in which the CITY is a party (each, a "Transaction").

To facilitate the preparation of the calculations and documents, the CITY will provide or cause to be provided to CONTRACTOR all relevant data requested by CONTRACTOR from time to time, with respect to each Transaction and the CITY’s fiscal year end date (each a “Calculation Date”), and the CITY agrees to cooperate with all reasonable requests in connection herewith.

CONTRACTOR will rely on this information in preparing the calculations of the mark-to-market value for each Transaction. CONTRACTOR may rely on market information services which are used generally by market-makers for pricing instruments similar to the Transactions, including information furnished by one or more brokers who engage in such transactions. The calculated mark-to-market values will be based upon available mid-market levels. The mark-to-market values are not an indication of a level where the CITY could enter into an actual Transaction, nor is it indicative of the level where the CITY could liquidate a Transaction. CONTRACTOR shall not have any obligation to update any valuation calculated hereunder because of events occurring or data or information received subsequent to the Calculation Date.

As applicable and pursuant to the Statement No. 53 of the Governmental Accounting Standards Board, Accounting and Financial Reporting for Derivative Instruments (GASB 53), and Board issued guidance, to the extent deemed appropriate, CONTRACTOR shall assess the transactions for effectiveness and hedge accounting. GASB 53 is effective for reporting periods beginning after June 15, 2009. After the end of each reporting period, from and including June 30, 2022, the first Calculation Date, CONTRACTOR shall deliver to the CITY an annual report with results on the assessments made pursuant to GASB 53 (“Annual GASB 53 Report”). CONTRACTOR shall also be available to answer questions regarding the methods and results by either the CITY or its auditors.

As applicable and pursuant to the Statement No. 72 of the Governmental Accounting Standards Board, Fair Value Measurement and Application (GASB 72), and Board issued guidance, to the extent deemed appropriate, CONTRACTOR shall compute the Fair Value of the Transactions that would reflect the effect of nonperformance risk. GASB 72 is effective for reporting periods beginning after June 15, 2015. After the end of each reporting period, from and including June 30, 2022, the first Calculation Date, CONTRACTOR shall deliver to the CITY an annual report with results on the assessments made pursuant to GASB 72. CONTRACTOR shall also be available to answer questions regarding the methods and results by either the CITY or its auditors.

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CITY OF MODESTO,
a municipal corporation
BY: ____________________________
JOSEPH P. LOPEZ, City Manager
ATTEST:
(Seal)
BY: ____________________________

BY: ____________________________
JOSE M. SANCHEZ, City Attorney
APPROVED AS TO FORM:

BY: ____________________________
JOE F. RODRIGUEZ, Risk Manager
Federal ID # ___________

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City of Modesto, California
Request for Proposal and Specifications No. 2122-01
for Municipal Advisory Services and Annual Derivative Valuation Report PFM Financial Advisors LLC
44 Montgomery Street, 3rd Floor
San Francisco, CA 94104
(415) 982-5544
www.pfm.com
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PFM Financial
Advisors LLC
44 Montgomery Street
3rd Floor
San Francisco, CA
94104
415.982.5544
www.pfm.com
January 28, 2022
City of Modesto, California
Request for Proposal and Specifications No. 2122-01
for Municipal Advisory Services and Annual Derivative Valuation Report Table of Contents
Cover Letter Letter
Proposal Acknowledgement....................................................................... I Pricing Schedule........................................................................................ II Exceptions, Clarifications, Amendments .................................................... III References ................................................................................................ IV Financial Interest Disclosure...................................................................... V Company History Statement ...................................................................... VI Technical Specifications ............................................................................ VII Appendices
A. Resumes
B. California Transaction List
C. Sample Reports
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ABOUT PFM
This material is for general information purposes only and is not intended to provide specific advice or a specific recommendation.

Financial advisory services are provided by PFM Financial Advisors LLC, registered municipal advisors with the Securities and Exchange Commission (SEC) and the Municipal Securities Rulemaking Board (MSRB) under the Dodd-Frank Act of 2010. Swap advisory services are provided by PFM Swap Advisors LLC which is registered as a municipal advisor with both the MSRB and SEC under the Dodd-Frank Act of 2010, and as a commodity trading advisor with the Commodity Futures Trading Commission. Additional applicable regulatory information is available upon request.

Consulting services are provided through PFM Group Consulting LLC. PFM Solutions LLC provides a financial modeling platform for strategic forecasting. A web-based platform for municipal bond information is provided through Munite LLC.

All services are provided through separate agreements with each company.

For more information, please visit www.pfm.com.
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January 28, 2022
Dianne Love
Senior Buyer
City of Modesto
1010 10th Street, Suite 6600
Modesto, CA 95354
Dear Dianne,

PFM Financial Advisors LLC (“PFM”) is pleased to submit our qualifications to continue to provide municipal advisory services to the City of Modesto (the “City”). We greatly value the working relationship we have built with the City since 1997 and hope we have demonstrated not only the benefit of using an independent financial advisor with the breadth and depth of resources PFM offers, but also our commitment to providing you with the very highest quality of service. We believe the range of knowledge and services PFM provides will continue to benefit the City as it confronts the challenges and opportunities of the future. The City is a very important client to PFM and we sincerely hope to continue the partnership we have developed with you over the last 25 years.

Broad Scope of Services to Serve the City’s Needs
PFM and its affiliates offer a broad range of services to our clients, many of which the City has used over the course of our decades working together including Swap Advisory services and Management and Budget Consulting, as well as traditional financial advisory services. As we believe we have demonstrated through our work with you, our broad scope allows PFM to provide a more integrated approach to supporting the City, be it preserving the City’s ratings, completing a refunding that lowers the cost of debt for the City and its utility ratepayers, or analyzing projects such as the Downtown Event Center and the financing strategies available to fund them.

PFM’s Market Knowledge
When it comes to the structuring and pricing of the City’s bonds, PFM is an effective advocate for the City. In 2021 we were in the market pricing our clients’ bonds an average of 18 times per week1
, giving us extensive market knowledge. We combine this market knowledge with our expertise in California municipal finance and our experience with Modesto to provide informed, responsive advice to the City.

PFM Brings Extensive Experience Relevant to the City’s Specific Needs Throughout PFM’s long relationship with the City, we have worked alongside staff on over 30 transactions and provided a wide range of services unrelated to debt financings.

We have helped guide the City through complex financings, challenging economic 1 Source: Ipreo, as of December 31, 2021.
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City of Modesto, California
January 28, 2022
cycles, and changes in leadership, providing continuity and institutional memory along with the deep and varied expertise required by such a large, diverse, and evolving community as Modesto. We understand the City’s potential needs with upcoming projects including potential refinancings of the City’s variable rate 2008 Lease Revenue Bonds and 2008 Water Certificates of Participation, analysis of the Downtown stadium and event center project, and funding of fire station improvements or other deferred maintenance. Additionally, we will continue to work with you on analyzing ways to manage pension costs.

We have assembled a team of professionals for the City’s engagement who specialize in the following areas and have highlighted the firm’s extensive experience in these sectors:
 General Fund
 Water and Wastewater
 Economic Development Finance
 Bond Pricing
 Swaps and Derivatives
Sarah Hollenbeck, a Managing Director and head of PFM’s San Francisco office, will continue to serve as the Project Manager and day-to-day contact for the City. Sarah specializes in working with cities in Northern California. Expertise with swaps and derivatives will be provided through PFM’s affiliate PFM Swap Advisors LLC by Alfred Mukunya, Director, who leads the swap advisory efforts and will head the team’s efforts on the Annual Derivative Valuation Report portion of the engagement. Primary support will continue to be provided by Nick Jones, a Senior Managing Consultant in PFM’s San Francisco office who has also advised the City for many years. Additional expertise with water and wastewater utilities will be provided by Darren Hodge, Director. Todd Fraizer, Managing Director and head of PFM’s Pricing Group, brings to the City’s engagement a deep knowledge of bond pricing and negotiation with bond underwriters to achieve the lowest borrowing cost for the City. Grace Wang, Senior Analyst, will continue to provide analytical support for the City. We would invite you to contact any of our clients with questions about our commitment to service, our responsiveness to their needs and requests on a timely basis, and our relevant experience.

Serving California Cities is a Core Practice of PFM
One of the core parts of PFM’s practice, both in California and nationally, is cities. We recognize and understand the particular complex challenges of cities, including their economic, physical and social contexts. We bring a sophisticated set of tools to these challenges and enable cities to understand and consider a full range of options. Our national perspective supports the City’s management of financial issues as it meets its critical public objectives.
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I. Proposal Acknowledgement
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II. Pricing Schedule
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III. Exceptions, Clarifications, Amendments
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3 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

EXCEPTIONS, CLARIFICATIONS, AMENDMENTS
Exceptions, Clarifications, Amendments
List requests for proposal clarifications and exceptions below, if any, sign and submit with your proposal response.

Item No. Reference To: Description
Page No. Paragraph No.

P. 20
P. 20-21
P. 21
P. 21

1.8 1.8B

1.8C

1.8 paragraph
after D, last
sentence.

INSURANCE
The CONTRACTOR shall provide, at its own expense, and maintain at all times the following insurance with insurance companies licensed in the State of California and shall provide evidence of such insurance to the CITY as may be required by the City Clerk of the CITY. The CONTRACTOR on behalf of the policies or certificates thereof shall provide that, thirty (30) days prior to cancellation or material change in the policy, notices of same shall be given to the Risk Manager of the CITY by registered mail, return receipt requested, for all of the following stated insurance policies.

Explanation: Not all insurers will provide such notices directly to PFM clients.

Some insurers will only provide notices in case of cancellation or non-renewals only.

General Liability - insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. The insurance shall indicate on the certificate of insurance the following coverage and indicate the policy aggregate limit applying to: premises and operations; broad form contractual; independent contractors and subcontractors; and products and completed operations; and/or professional liability.

Explanation: PFM’s policies do not allow for coverage of independent contractors and subcontractors. Each must provide separate, current and sufficient proof of coverage. PFM’s Professional Liability is produced under a separate insurer and certificate.

Automobile Liability – insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover hired and/or non-owned any automobile for bodily injury and property damage.

Explanation: PFM does not own autos. Auto liability coverage will be provided for hired and non-owned autos only.

The CITY, it agents, officers, employees, and volunteers shall be named as an additional insured on all insurance policies required herein, except Workers' Compensation and Professional Liability.

Explanation: Industry standards prohibit the inclusion of additional insureds on workers compensation and professional liability.
(continued on next page)
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4 Item No. Reference To: Description
Page No. Paragraph No.

P. 27
P. 37
P. 37
P. 38
P. 39

2.19 4. (b)

4. (c)

4. last paragraph
of the page

4. last paragraph
of the section

HOLD HARMLESS AGREEMENT
The CONTRACTOR shall hold the CITY, its agents, officers, employees, and volunteers, harmless from and save, defend and indemnify them against any and all claims, losses, liabilities and damages from every cause, including but not limited to injury to person or property or wrongful death, with the indemnity to include reasonable attorney's fees, and all costs and expenses, arising directly or indirectly out of any negligent or intentionally wrongful act or omission of CONTRACTOR, whether or not unless the act or omission arises from the sole negligence or other liability of CITY, or its agents, officers, employees, or volunteers relating to or during the performance of its obligations under the Agreement.

Explanation: PFM respectfully requests the opportunity to negotiate the indemnification language in any resulting agreement so that PFM’s obligation to indemnify is limited to circumstances in which its performance has been wrongful, which would include negligent or intentionally wrongful acts.

This insurance shall indicate on the certificate of insurance the following coverages and indicate the policy aggregate limit applying to: premises and operations; broad form contractual; independent consultants and subcontractors; products and completed operations as applicable.

Automobile Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover hired and non-owned any automobile for bodily injury and property damage.

Explanation: PFM does not own autos. Auto liability coverage will be provided for hired and non-owned autos only.

Explanation: The paragraph appears repetitive to the previous paragraph. PFM recommends deleting this paragraph as the previous one is more tailored to PFM insurance.

At the time of renewal or amendment, CONTRACTOR further agrees that the amount of insurance required may from time to time be adjusted by CITY’s Risk Manager and CONTRACTOR agrees to file a new insurance certificate with CITY’s City Clerk evidencing the new amounts after a thirty (30) day written notice from CITY’s Risk Manager.

Explanation: Requirements to the insurance technically can only be altered at the time of renewal or amendment for PFM.
(continued on next page)
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IV. References
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6 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

REFERENCES
Provide a list of five (5) current or former clients in the area provided below, identifying prior experience with the same type of services requested by the City under Scope of Work. References shall have similar volume and requirements to those outlined in these specifications, terms and conditions. Proposers failing to provide references shall be deemed unacceptable.

The City may contact some or all of the references provided in order to determine the Proposers’ performance record on services similar to that described in this proposal. The City reserves the right to contact references other than those provided in the response and to use the information gained from them in the award process.

Company Name: City of Santa Rosa
Address: 90 Santa Rosa Avenue, 2nd Floor
City, State, Zip Code: Santa Rosa, CA 95404
Contact Person: Alan Alton, Acting Chief Financial Officer Kimberly Zunino, Deputy Director, Santa Rosa Water
Email Address: [email protected]
[email protected]
Telephone Number: (707) 543-3093 Alan Alton
(707) 543-3960 Kimberly Zunino
Type of Business: City
Date of Service: 2006 - Present
Annual Contract Value Transaction fees ranging from $25,000 - $120,000 Company Name: City and County of San Francisco
Address: City Hall, Room 336
City, State, Zip Code: San Francisco, CA 94102
Contact Person: Anna Van Degna, Director, Controller’s Office of Public Finance Email Address: [email protected]
Telephone Number: (415) 554-5956
Type of Business: City & County
Date of Service: 1990’s - Present
Annual Contract Value Transaction fees ranging from $40,000 - $80,000 Company Name: County of Sacramento
Address: 700 H Street, Room 7650
City, State, Zip Code Sacramento, CA 95814
Contact Person: Colin Bettis, County Debt Officer
Email Address: [email protected]
Telephone Number: (916) 874-5239
Type of Business: County
Date of Service: 2009 - Present
Annual Contract Value Transaction fees ranging from $25,000 - $125,000 #13..
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7 Company Name: City Vallejo
Address: 555 Santa Clara Street
City, State, Zip Code: Vallejo, CA 94590
Contact Person: Rekha Nayar, Director, Finance
Email Address: [email protected]
Telephone Number: (707) 648-5433
Type of Business: City
Date of Service: 2004 - Present
Annual Contract Value NTE $600,000 over 5-year term.

Company Name: Iowa Economic Development Authority*
Address: 1963 Bell Avenue, Suite 200
City, State, Zip Code Des Moines, IA 50315
Contact Person: Cindy Harris, Chief Financial Officer
Email Address: [email protected]
Telephone Number: (515) 452-0410
Type of Business: Finance Authority
Date of Service: 2010 to Present
Swap Valuations, Monitoring, Accounting, & Reporting
Annual Contract Value $30,000
*PFM Swap Advisors LLC
Company Name: School District of Palm Beach County*
Address: 3300 Forest Hill Blvd., Suite A-334
City, State, Zip Code West Palm Beach, FL 33406
Contact Person: Leanne Evans, Treasurer
Email Address: [email protected]
Telephone Number: (561) 434-8142
Type of Business: School District
Date of Service: 2006 – 2018
Swap Valuations, Monitoring, Accounting, & Reporting
Annual Contract Value $8,000
*PFM Swap Advisors LLC
Company Name (Proposer): PFM Financial Advisors LLC
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8 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report City of Santa Rosa 2006 - Present
Alan Alton, Acting Chief Financial Officer
[email protected]; (707) 543-3093
90 Santa Rosa Avenue, 2nd Floor
Santa Rosa, CA 95404
Kimberly Zunino, Deputy Director, Santa Rosa Water
[email protected]; (707) 543-3960
69 Stony Circle
Santa Rosa, CA 95401
PFM has served as general Financial Advisor to the City of Santa Rosa since 2006. 2 PFM
advises the City on all debt issuances and provides ongoing, as-needed financial advisory services related to other financial matters as they arise. These debt transactions have included multiple series of Water and Wastewater Revenue Bonds (both new money and refunding), General Fund Lease Revenue Bonds (sold both publicly and via private placement), and Pension Obligation Bonds. Outside of our debt transaction services, PFM has worked with the City to develop and evaluate financing options for funding its capital projects, including presentations to the City Council on Enhanced Infrastructure Financing Districts (EIFDs) and public-private partnerships (P3s). PFM has been advising the City on a P3 project since 2017 and previously worked with the City to develop a long-term financial plan.

In 2020, PFM supported the City on its $104 million taxable and tax-exempt wastewater refunding and new money transaction. Initially, for the 2020 financing the City was proposing to issue only a new money borrowing to fund improvements to its Laguna Treatment Plant. PFM identified the potential refunding of the 2012A Bonds, outstanding in the amount of $50.9 million. With taxable municipal rates near historic lows, a taxable refunding of the 2012A Bonds offered compelling economic savings. In addition, a refunding of the 2012A Bonds, in combination with the new money issue, enabled the City to trigger springing amendments to its Master Indenture to eliminate the requirement for a debt service reserve fund. The refunding generated economic savings of approximately $9.7 million, or over 19% of the refunded principal, and the new money financing locked in a borrowing cost of 2.13% for $70 million of capital projects.

Most recently, PFM has been advising the City in connection with the evaluation of options for funding its unfunded pension liability, including the potential issuance of Pension Obligation Bonds. The City Council has approved the issuance of POBs and we are currently working with City staff to refine the plan of finance given the recent CalPERS changes and to evaluate the probability of a POB strategy yielding financial benefit to the City. 2 PFM Financial Advisors LLC commenced operations on June 1, 2016, accordingly all client engagements that occurred prior to such date were effected through Public Financial Management Inc. #13..
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9 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report City and County of San Francisco 1990s - Present
Anna Van Degna, Director, Controller’s Office of Public Finance [email protected]; (415) 554-5956
City Hall, Room 336
San Francisco, CA 94102
Since the 1990s, PFM has worked with the City and County of San Francisco in many capacities and for many of the City’s agencies. 3 Our work for the Controller’s Office of
Public Finance, which manages San Francisco’s General Obligation, General Fund, and CFD debt, has encompassed over $2 billion of GO Bonds, Lease Revenue Bonds, COPs, and CFD Bonds. In addition to the Controller’s Office of Public Finance, PFM also currently advises the San Francisco Public Utilities Commission, San Francisco International Airport, and the Port of San Francisco. These entities have capital plans larger than those of some cities and each requires a dedicated team with specific expertise, which PFM can provide thanks to the depth of experienced staff in our San Francisco office.

PFM’s recent experience advising the Controller’s Office of Public Finance encompasses nearly $800 million of new money and refunding Certificates of Participation, General Obligation Bonds, and CFD Bonds. Recently, PFM assisted the City in the 2021 issuance of its MelloRoos Special Tax Bonds for the Mission Rock Community Facilities District, which is a mixeduse development project that will create up to 1,200 units of housing, 1.4 million square feet of new office space, and a new waterfront park across from Oracle Park. After more than a decade of planning, the Project broke ground in 2021. This is just one of many development projects we have worked on for the City and County, which include Treasure Island, South of Market, Hunter’s Point, and the Transbay Terminal.
3 PFM Financial Advisors LLC commenced operations on June 1, 2016, accordingly all client engagements that occurred prior to such date were effected through Public Financial Management Inc. #13..
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10 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report County of Sacramento 2009 - Present
Colin Bettis, County Debt Officer
[email protected], (916) 874-5239
700 H Street, Room 7650
Sacramento, CA 95814
PFM has worked with Sacramento County since 20094
, as we commenced our engagement
assisting the County in navigating the Great Recession. The County faced sharp declines in revenues, weakening reserve levels, and increasing labor costs, with a deteriorating credit profile resulting in several credit rating downgrades. The County’s large variable rate debt portfolio posed a significant challenges, with two expiring Letters of Credit (“LOC”) raising the risk of mandatory tenders, and several interest rate swaps posing termination risk. Additionally, the County had a frontloaded debt service structure that, if left alone, would have strained the County’s budget. As a result, the first bond issuance we advised the County on was $126 million of 2010 Refunding Certificates of Participation (“COPs”) issued to refund three series of COPs to restructure the County’s debt profile and create much-needed upfront General Fund budgetary relief.

Over the past five years, services we have provided the County include 2017 and 2018 Community Facilities District (“CFD”) Special Tax Bonds for new money and refunding, prepayment analysis for existing CFD bonds and existing Airport Revenue Bonds, 2018A-F Airport System Senior and Subordinate Revenue Refunding Bonds, 2018AB Refunding COPs, 2019 Judgement Obligation financing analysis, 2019 Water Revenue Refunding Bonds, 2020 Solid Waste Revenue financing analysis (ongoing), 2020 Airport System Senior Revenue Refunding Bonds, debt policy update, and we have now come full circle with the County as we advised on the issuance of 2020 COPs to refund the remaining $40 million outstanding of the 2010 COPs, the first series we ever advised the County on, in the midst of yet another economic crisis brought on by the COVID-19 pandemic. Thankfully, the County’s debt portfolio has become much more manageable since 2010: credit ratings have been upgraded, upfront budget relief is no longer needed, aggregate General Fund debt service is fairly level, and we were thus able to structure the 2020 COP refunding for significant level annual savings, as was done with other recent refundings for the County on which PFM advised (2018AB Refunding COPs, 2019 Water Revenue Refunding Bonds). Since 2020, we have also advised the County on bond transactions relating to its Sunrise Recreation and Park District, North Vineyard Station No. 2 Community Facilities District No. 2014-2, Tobacco Settlement Asset-Backed Refunding Bonds, as well as the formation of an Enhanced Infrastructure Financing District for its Metro Air Park near Sacramento International Airport (ongoing), and a federal Water Infrastructure Finance and Innovation Act (“WIFIA”) loan (closed December 8, 2021) along with Water Revenue Bonds (closing on February 1, 2022) to provide low-cost short-term financing before the WIFIA loan is drawn on.
4 PFM Financial Advisors LLC commenced operations on June 1, 2016, accordingly all client engagements that occurred prior to such date were effected through Public Financial Management Inc. #13..
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11 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report City of Vallejo 2004 - Present
Rekha Nayar, Director, Finance
[email protected]; (707) 648-5433
555 Santa Clara Street
Vallejo, CA 94590

PFM has served as general financial advisor to the City of Vallejo since 2004. 5 As a full-service
city with diverse needs related to both capital project financings and other finance related matters, PFM’s services to Vallejo have spanned a wide range. We have assisted the City’s Water utility in the replacement of letters of credit for its outstanding variable rate demand obligations (“VRDOS”), refinancing of the VRDOs into fixed rate bonds, and issuance of refunding and new money Water Revenue Bonds, including Green Bonds; advised the City on the refunding of outstanding Improvement District Bonds; provided analysis to support the City’s effort to place an Affordable Housing General Obligation Bond measure on the ballot; reviewed actuarial consultants’ pension funding analyses and analyzed POB issuance; and assisted the City in responding to rating agency and bond insurer surveillance requests. Currently, PFM is advising the City in connection with a planned lease financing of approximately $25-$35 million for a new Police Department building to replace an aged facility that can no longer be used. In connection with this project, PFM has prepared credit analyses for the City, evaluated debt financing capacity to fund the new building, and assessed the benefit of borrowing through the State Infrastructure and Economic Development Bank (“IBank”) versus issuing debt in the public market, which may be beneficial to the City given the interest rate subsidy offered by the IBank to borrowers with low median household income and high unemployment relative to the California state averages.
5 PFM Financial Advisors LLC commenced operations on June 1, 2016, accordingly all client engagements that occurred prior to such date were effected through Public Financial Management Inc. #13..
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12 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Iowa Economic Development Authority / Iowa Finance Authority 2010 - Present Cindy Harris, Chief Financial Officer
[email protected], (515) 452-0410
1963 Bell Avenue, Suite 200
Des Moines, IA 50315
A typical Housing Authority’s mandate is to offer affordable housing with the ability for the end borrower to prepay with no penalty. This necessitates the Housing Authority use some of the most complex callable swap structures to hedge their ongoing bond financings. Iowa Economic Development Authority (“the Authority”) engaged PFM Swap Advisors LLC (“PFMSA”) for ongoing valuations, monitoring and assistance with accounting pursuant to GASB 53 Effectiveness Testing and Measurement, and GASB 72 Fair Value Measurements. The Authority has access to its swaps on SwapViewer®, PFMSA’s online application. The Authority had several swaps with a bank counterparty that had been actively seeking to exit the municipal swaps market. The counterparty offered our client the opportunity to novate or assign away the transactions at reduced transaction costs to another willing bank counterparty. Our client asked us to review the accounting implications as several other peer Housing Authorities had already performed, or were in the process of assigning away transactions from this counterparty. With the swaps in a liability position and upon review of GASB Statement Nos. 53 and 64, it was PFMSA’s opinion that this assignment would have resulted in a potential loss being recorded by the Authority, and management would have to take this fact into consideration. The knowledge we provided allowed our client to proceed with internal education about the accounting implications rather than novating and then being surprised with a loss at Fiscal Year End. We provided our client pro-forma entries showing the application of accounting for off-market swaps with the relevant passages in GASB 53. Our client realized the necessity of taking the time to educate various stakeholders before performing the assignment transaction. Even though it was prudent for management to assign the transactions so they would have a better rated counterparty, there would have been an unrealized loss. There was no cash changing hands, better economics with a better rated counterparty yet a material enough accounting disclosure item that the Authority needed time to assess within the organization and PFM’s swap group helped through this.

In addition to this accounting issue, PFMSA noted that the Authority had unique language in some of the trade confirmations that allowed the Authority to cancel the underlying swap notional at a faster rate than would typically be outlined in cancellable swaps that hedge mortgage bonds. We reached out to the swaps desk at the counterparty with mathematical equations walking through and outlining where we saw the value lie, and why we saw the options as being undervalued by the counterparty. The counterparty conceded there was value favorable to the client in comparison to what they had booked. This ensured that in the event of an assignment or termination of the subject transactions, these terms that contained material economic value would be preserved or taken into account.

As a specialist in performing valuations and aiding our clients comply with GASB 53, PFMSA does not look at just the task at hand, but at how the entire swaps program fits into overall management strategy.
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13 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report School District of Palm Beach County 2006 - 2018
Leanne Evans, Treasurer
[email protected], (561) 434-8142
3300 Forest Hill Blvd., Suite A-334
West Palm Beach, FL 33406
The School District of Palm Beach County had engaged PFM Swap Advisors LLC (“PFMSA”) for ongoing valuations, monitoring and assistance with accounting. Their staff received independent mark-to-market reports, valuations, payments calculations all accessible on SwapViewer® PFM’s online application. They also had a SIFMA swap and the opportunity to reduce the fixed rate of the swap for three years, by changing the floating rate to a percentage of LIBOR. Although they would have had economic savings upon the contractual amendment, with interest rates being very low, the client faced the potential of recording a $31 million accounting loss upon ending hedge accounting for the entire transaction, or a $17.7 million accounting loss for ending hedge accounting on the 3 year portion of the transaction.

The specialized diagram to the left prepared by PFMSA for the client was submitted to the GASB to clarify the transaction and all its components. PFMSA was able to provide an explanation of how to
account for a swap
amendment under
GASB 53, and its
experience of
achieving the same
economics with other
types of transactions
with a basis swap.

Upon discussion with
the GASB, it was
determined the client
could still achieve the
Contractual Savings
depicted, continue on
with hedge accounting
without recording the $17.7 million loss. Note, without PFMSA’s advice, the auditor had suggested ending hedge accounting for the entire transaction, and the client could have recorded a $31 million loss as all the swap components depicted would have been deemed terminated.

The above is a demonstration of PFMSA’s expertise in derivatives valuations, diligence in seeking the best economic and accounting outcome for our clients and in compliance with the regulations and requirements.
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City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report V. Financial Interest Disclosure
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14 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Financial Interest Disclosure
Not applicable. Should PFM Financial Advisors LLC and/or PFM Swap Advisors LLC be awarded this engagement, we expect that the value of the resulting contract would exceed $2,000.00. However, at this time we are not aware of any individual at the firm with a material financial interest in any contract, agreement, or application for development rights, directly or indirectly, of $2,000.00 or more.
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VI. Company History Statement
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15 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Company History Statement
Company Background and Firm Qualifications
PFM Financial Advisors LLC (“PFM”) has one of the largest financial advisory teams in the public finance industry, maintaining an expansive national presence. The original practice, Public Financial Management, Inc., was founded in 1975 with the mission of providing independent financial advice to state and local governments and governmental agencies when bringing their debt to the market, investing funds, or undertaking capital planning and budgeting. In 2014, as a result of the SEC’s new rules for Municipal Advisors (born out of the Dodd-Frank Act of 2010), our firm’s corporate structure was reorganized so that municipal advisory services could be delineated clearly from our other financial consulting services. Accordingly, given the regulation of municipal advisory activities, financial advisory services are now offered through PFM Financial Advisors LLC, which commenced operations on June 1, 2016. PFM Financial Advisors LLC is a registered municipal advisor with the Securities and Exchange Commission (“SEC”) and the Municipal Securities Rulemaking Board (“MSRB”). Our SEC Number is 867-02030 and our MSRB ID is K1162. PFM is registered to conduct in business within the City of Modesto (the “City”) (Business License #1294958).

Since 1998, PFM has
consistently ranked as the
country’s top financial advisor.6

PFM and its affiliates currently
have more than 350 employees,
including 222 financial advisory
personnel, located in 31 offices and locations
across the United States (as of 12/7/21). The City’s
engagement will primarily be serviced from PFM’s
San Francisco office, but personnel working from
across the country are available to meet the City’s
needs.

On July 7, 2021, the holding company for PFM
Asset Management LLC (“PFMAM”) entered into a definitive agreement to sell its asset management business including PFMAM, then an affiliate of PFM, along with other entities associated with PFMAM, to U.S. Bancorp Asset Management Inc. (USBAM), a subsidiary of U.S. Bancorp. The transaction successfully closed on December 6, 2021. The sale did not affect PFM’s financial advisory and consulting businesses. PFM and its remaining affiliates (PFM Swap Advisors LLC, PFM Group Consulting LLC, and PFM Solutions LLC) continue to operate as-is, providing leading financial advisory and consulting services.

PFM and its remaining affiliates are wholly owned by its 41 Managing Directors, who set the firm’s strategic direction. The firm comprises four affiliates that are indirect, wholly owned subsidiaries of a holding company known as PFM II, LLC. Employees of our affiliates are co6 Source: Ipreo, as of December 31, 2021. Based on par amount and number of transactions. #13..
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16 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report located in PFM’s offices across the country. Services provided by affiliates of PFM’s business are offered pursuant to separate agreement and fees.  PFM Financial Advisors LLC: advises on debt management and portfolio optimization, transaction structuring and execution, capital and financial planning, credit analysis, and policy development, among other services.  PFM Swap Advisors LLC (“PFMSA”): PFMSA includes professionals dedicated to advising clients on obtaining, managing, and valuation of interest rate swaps and related financial products used to help manage exposure to interest rates.  PFM Group Consulting LLC: PFM Group Consulting LLC (“MBC”) provides a broad range of services, including multiyear financial planning, Public Safety financial and operational reviews, consolidation and shared-services analysis, revenue maximization, fleet management, workforce analysis, and pension and other postemployment benefits (OPEB) review and strategies.  PFM Solutions LLC: PFM Solutions LLC is our affiliate through which innovative services are developed, such as Synario, a flexible financial modeling platform designed to produce dynamic, multi-year financial projections to facilitate strategic planning for various industry sector.

Financial Stability
We believe that the financial condition of PFM is strong. Due to our varied clients and expertise, PFM has a deep client base to drive continued success. Furthermore, we are not aware of any factors that may impede our continuance as a financially secure, ongoing business. Please refer to the envelope marked “Financial Statements” included with this submittal.

Project Team
PFM has been honored to serve as municipal advisor to
the City for 25 years. Sarah Hollenbeck, Managing
Director and head of PFM’s San Francisco office, has
served as Project Manager for the City’s engagement since 2016 and will continue to do so. Sarah specializes in
working with cities in Northern California, and in addition to serving as day-to-day contact for the City, will provide focus PFM Financial Advisors LLC
Sarah Hollenbeck, Managing Director
44 Montgomery Street, 3rd Floor
San Francisco, CA 94104
(415) 393-7260; [email protected]
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17 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report on the City’s overall financing issues, centralized resource management, and accountability.

Primary support will continue to be provided by Nick Jones, Senior Managing Consultant in PFM’s San Francisco office, who has also advised the City for nearly a decade.

In addition to Sarah and Nick, we have assembled a deep bench of senior professionals to serve the City and are dedicated to supporting the City with any potential needs. Christine Choi, Director, will provide expertise in the area of economic development and alternative financing methods, including IFDs and EIFDs. Darren Hodge, Director, will provide additional Water and Wastewater experience, with a particular expertise relating to the Federal WIFIA program. Grace Wang, Senior Analyst and Jordan Garcia, Analyst, will provide quantitative support for all projects.

Expertise with swaps and derivatives will be provided by Alfred Mukunya, Director, of PFM Swap Advisors LLC, who has worked with the City on its Annual Derivative Valuation Reports since 2010. Alfred will continue to head the team’s efforts on the swap reporting and valuation portion of the engagement. George Hu, a Senior Managing Consultant in the swap advisory business, will provide advice and strategic recommendations relating to management of the City’s outstanding swap portfolio, including strategies to address the cessation of LIBOR in 2023.

In addition to our day-to-day resources, our team includes Todd Fraizer, Managing Director and head of PFM’s dedicated Pricing Group in our Charlotte office. While we do not underwrite any bonds or securities, PFM’s pricing desk leverages our market presence and negotiates on a daily basis directly with investments throughout the U.S., to ensure the most competitive pricing on behalf of the City and all of our clients. Finally, as for all our clients, the full firm-wide resources of PFM are available to the City to meet any additional needs. #13..
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18 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report  Sarah Hollenbeck, Managing Director – San Francisco: Sarah Hollenbeck will serve as engagement manager for all of the City's projects to ensure that the full resources of PFM are available to the City. Sarah joined PFM in 2001 and brings over twenty years of experience in public finance. Prior to joining PFM, Sarah was Public Finance Manager for the City and County of San Francisco, where she was responsible for the day-to-day management of the San Francisco's $2.3 billion portfolio of general obligation, lease revenue, COPs and other tax-supported debt.

Her financing experience encompasses lease revenue bonds, COPs, water/wastewater revenue bonds, Pension Obligation Bonds, Mello-Roos and Assessment District Bonds, sales tax revenue bonds, and tax increment bonds.

Sarah has served as financial advisor to numerous cities throughout California including the cities of San Jose, Santa Rosa, San Luis Obispo, San Rafael, Fairfield, Eureka, and Vallejo, the City and County of San Francisco, and numerous special districts. She has recently been engaged to provide pension funding analysis and/or to serve as municipal advisor on POB issuances for the cities of Santa Rosa, Eureka, and Vallejo, the Monterey Peninsula Airport District, the Central Marin Sanitation Agency, and the Livermore Area Recreation and Park District.

Sarah has worked on a variety of projects with the City of Modesto since the mid2000s, including Lease Revenue Bonds (“LRB”), Wastewater Revenue Bonds and bank loans, Water Certificates of Participation (“COP”) and associated rate study analysis, Community Facilities District (“CFD”) Special Tax Bonds, State Revolving Fund loans, client training, annual debt policy review, monthly swap Mark-To-Market update, various Letter of Credit (“LOC”) renewals and replacements, interest and swap and LOC payment computations for variable rate bonds, as well as capital projects financing and capacity analysis.
 Nick Jones, Senior Managing Consultant – San Francisco: Nick joined PFM in 2010 and supports PFM’s services for a variety of municipal clients in the western United States. He provides transaction management support and technical and quantitative support for an array of clients, including the County of Sacramento, the City and County of San Francisco, and the cities of Palo Alto, Santa Rosa, Fairfield, and San Jose. His present duties include project management support, financial planning and modeling as well as analyzing the viability of debt issuances, structuring, sizing, and pricing new money and refinancing bond issues, reviewing and assessing issuers’ debt profiles, and performing analysis of restructuring opportunities. Nick has worked on all of PFM’s projects with the City of Modesto since 2015.  Christine Choi, Director – San Francisco: Christine has over twelve years of experience advising on capital planning, ongoing debt portfolio management, transaction management, and strategic financial planning for municipal clients.

During her tenure at PFM, Christine has been involved in the debt structuring of over $10 billion in bond issues. Her experience includes General Obligation, Lease Revenue Bond, Certificates of Participation, and state transportation revenue, airport revenue, port revenue, sales tax revenue, and water revenue bond transactions. In addition to her significant transaction experience, Christine works with several municipal issuers on long-term capital planning, policy development #13..
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19 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report and capacity analysis, public private partnerships relating to real estate development of publicly owned land, and credit strategy development.  Darren Hodge, Director – Chandler: Darren heads serves numerous Western Region municipal entities including cities, counties, public utilities, and transportation entities. During his seventeen-year career he has worked on over $34 billion of bond sales involving securities across the credit spectrum. His experience assisting Western US municipalities with their funding needs has included working with Coachella Valley Water District, Contra Costa Water District, Eastern Municipal Water District, Inland Empire Utilities Agency, Metropolitan Water District of Southern California, West Basin Municipal Water District, and Western Municipal Water District. In addition to structuring and selling traditional municipal bonds, Darren has also assisted his clients with their financial plans through the structuring of alternative funding programs such as WIFIA, TIFIA, CREBs, QSCBs and BABs as well as negotiating asset transfers with national insurers and preparing comprehensive rating agency strategies.
 Grace Wang, Senior Analyst – Los Angeles: Grace Wang joined PFM’s Financial Advisory team in 2018. Grace provides technical and quantitative support for a variety of local governments and transportation clients. Her present duties include cashflow modeling, credit analysis, structuring, sizing, pricing new money and refunding bond issues, evaluating municipal issuers’ outstanding debt, and performing analysis of refunding opportunities. Grace has worked on all of PFM’s projects with the City of Modesto since 2020.
 Jordan Garcia, Analyst – San Francisco: Jordan Garcia joined PFM in 2021 and is currently staffed in the San Francisco office. Jordan’s work involves providing technical and quantitative support for a variety of clients including the State of Oregon, the City of Fairfield, the San Bernardino Association of Governments, the State of Hawaii, Washoe County RTC, RTC of Southern Nevada, and the San Diego Association of Governments.
 Todd Fraizer, Managing Director - Charlotte: Todd Fraizer heads our Pricing Group and is involved in nearly every negotiated transaction for which PFM is financial advisor – several hundred annually. The Pricing Group provides independent views of pricing levels in advance of pricing and negotiates the most favorable rates available in the market on the clients’ behalf. Todd and his team work on a daily basis with all major investment banks and maintain current intelligence and knowledge of individual investor demand, structural preferences, and pricing levels at which our clients’ bonds should price.
 Alfred Mukunya, Director - Philadelphia: Alfred Mukunya leads PFMSA’s derivatives monitoring, accounting, and valuations business. He led the creation of SwapViewer®, which oversees reporting on more than $50 billion in swap and derivatives belonging to more than 100 different tax-exempt and municipal issuers, including general municipal, school districts, public utilities, higher education, and healthcare.
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20 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report  George Hu, Senior Managing Consultant – Philadelphia: George Hu provides technical analysis for PFMSA, focusing primarily on the incorporation of derivatives into tax-exempt debt management. He is responsible for modeling and pricing various forms of derivatives, including swaps, caps, collars, floors, and swaptions.

He also performs risk/benefit analysis, manages swap dealer relationships, and ultimately ensures successful execution of interest rate hedges for various clients.

Please refer to Appendix A for detailed project team resumes.

PFM’s Financial Advisory Experience
Since 1998, PFM has
consistently ranked as the
country’s top financial
advisor.7
While our top
ranking is noteworthy, we
believe it is also indicative of
the depth of experience and
the quality of services that our
financial advisory team
provides and the reputation of
the firm in the market. In 2021,
we once again achieved this
coveted ranking by advising on 935 transactions totaling over $69.7 billion in principal amount.

Much of our capabilities and expertise come from our experience advising on our clients’ debt issuances. As illustrated in the ranking chart above, PFM manages more transactions than any other firm in the industry.

In California alone since 2018, PFM has served as financial advisor on over 275 transactions representing over $57 billion in par value.
8 These financings have ranged in size from under
$1.5 million to over $1.7 billion and spanned the full breadth of the State in terms of types of issuers, bonds, and projects being financed. We are as comfortable and as knowledgeable advising the City on a $6 million lease financing for fire station improvements, for example, as on a complex $100 million wastewater refinancing with both taxable and tax-exempt components, or a LIBOR swap termination analysis. Please refer to Appendix B for our California transaction list since 2018.

Swap Advisory Credentials
PFM Swap Advisors LLC (“PFMSA”), our swap advisory group, is a leader in providing swaps and derivative products advice. PFMSA is a Registered Municipal Advisor registered under the applicable SEC Rules and with MSRB under the Dodd-Frank Act of 2010, and a Commodity Trading Advisor (“CTA”) registered with the Commodity Futures Trading Commission (“CFTC”).

PFMSA has internal procedures that were written to be in compliance with the new Dodd-Frank 7 Source: Ipreo, as of December 31, 2021. Based on par amount and number of transactions. PFM Financial Advisors LLC commenced operations on June 1, 2016, accordingly all client engagements that occurred prior to such date were effected through Public Financial Management Inc.
8 Source: Ipreo, as of December 31, 2021. Based on par amount and number of transactions. 2021 Full Year Overall Long Term Municipal New Issues
Municipal Financial Advisory Ranking - Full Credit to Each Financial Advisor Source: Ipreo
# issues $ in millions
PFM 935
Public Resources 187
Hilltop Securities 758
Acacia Fin Group 140
Frasca & Associates 40
Piper Sandler 214
KNN Public Finance 76
Estrada Hinojosa 84
RBC Capital Mkts 125
Swap Financial 14
69,712
60,100
35,496
17,167
16,751
12,259
10,403
9,824
8,941
7,930
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21 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report related regulations, in particular with CFTC Regulation 17 CFR §23.401, 23.434 and 23.450.

We are fully qualified to serve as a designated Qualified Independent Representative (“QIR”).

Our swap practice began as a separate business group in 19979 . Since then, PFMSA has
advised state, local government and not-for-profit issuers on over 2110 swap and derivative transactions totaling over $144 billion in notional principal amount (and including the termination or amendment of
1032 transactions with a total notional amount of over
$61.6 billion)10. Given our industry leading position, we seek to negotiate more favorable terms on behalf of our clients. Our group’s sole focus is this extremely complex area of public finance. We believe that the knowledge,
market access, technical skills and resources we offer
are on par with those of the major investment banks. Our substantial technical resources and large volume of
derivatives advisory business gives us a competitive
advantage and distinguishes us from smaller swap
advisors. Our vast client base allows us to achieve
economies of scale in developing new applications and
technology, such as our SwapViewer® valuation website,
which the Modesto currently uses to monitor its four
outstanding swaps. As noted earlier, services provided
by PFMSA are provided pursuant to separate agreement
and fees.

A detailed description of the services we offer in relation to annual derivative reporting for compliance with GASB 53 and GASB 72 is provided in the Technical
Specifications section of this proposal.

California City Experience
PFM has over 25 professionals staffed within our offices in San Francisco and Los Angeles and one of our core
businesses is advising California cities. To the right we have provided a chart listing selected California City
clients of PFM’s financial advisory business, as well as the types of services we have provided.

We have assisted both large and small cities in the
development of financing plans for capital projects,
creation of Infrastructure Financing Districts, preparation of ballot measures, and structuring and execution of
9 PFM Financial Advisors LLC commenced operations on June 1, 2016, accordingly all client engagements that occurred prior to such date were effected through Public Financial Management Inc. 10 PFM Internal Database as of December 31, 2021.

Financial Analysis/Capital Planning
General Obligation Bonds
Revenue Bonds
Lease Revenue/Certificates of Participation
Pension/Judgment Obligation Bonds
RDA/Tax Increment
Commercial Paper
Short-term/Tax, Revenue Anticipation Notes
Land Secured Financings
Equipment Leases
California Cities
Alameda ● ● ● ● ● ●
Anaheim ● ● ●
Albany ●
Antioch ● ●
Belmont ●
Burbank ● ●
Burlingame ●
Chula Vista ●
Elk Grove ● ● ● ● ●
Eureka ● ● ● ● ●
Fairfield ● ● ● ●
Fortuna ● ● ● ●
Glendale ● ● ● ●
Hercules ● ● ●
Huntington Beach ● ● ●
Imperial Beach ● ● ● ●
Lafayette ● ●
Lathrop ● ● ●
Lincoln ● ● ● ●
Long Beach ● ● ●
Martinez ●
Menlo Park ●
Millbrae ● ●
Modesto ● ● ● ● ●
Napa ●
Newark ●
Novato ● ● ●
Oakley ● ● ● ●
Oakland ●
Oceanside ● ● ● ● ● ● ●
Palo Alto ● ● ●
Pleasanton ●
Pittsburg ● ● ● ● ●
Rancho Cordova ● ● ● ●
Riverside ● ● ●
Roseville ● ● ● ● ●
San Bernardino ● ● ● ● ●
San Diego ● ● ● ●
San Jose ● ● ●
San Leandro ● ● ● ●
San Luis Obispo ● ●
San Rafael ●
Santa Cruz ● ●
Santa Rosa ● ● ● ● ● ● ●
Saratoga ●
South Lake Tahoe ● ● ● ● ● ● ● ●
South San Francisco ● ● ●
St. Helena ●
Ukiah ● ●
Vallejo ● ● ● ●
PFM California Clients (Selected)
Client list is provided for
informational purposes
only and does not
constitute an
endorsement or
testimonial by clients
listed of services
provided by PFM’s
financial advisory
business, which consists
of Public Financial
Management Inc. and
PFM Financial Advisors
LLC. PFM Financial
Advisors LLC
commenced operations
on June 1, 2016,
accordingly all client
engagements that
occurred prior to such
date were effected
through Public Financial
Management Inc.
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22 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report various forms of financings including General Obligation Bonds, Lease Revenue Bonds, Certificates of Participation, Water and Wastewater Revenue Bonds, CFD Bonds, Pension Obligation Bonds, Bond Anticipation Notes and other short term cash flow borrowings. In developing financing plans for our clients, we focus on ensuring that staff and policymakers fully understand their alternatives and the benefits and considerations associated with different financing approaches.

In addition, PFM works with municipal clients on a variety of non-debt issuance related projects.

Some of these projects include developing long-range land development strategies involving public and private financing methods, comprehensive financing plans incorporating multiple revenue streams and multi-agency agreements, Public-Private Partnership (“P3”) analysis, quantitative analysis for legislative actions, and variable rate demand bond and swap portfolio monitoring.

PFM’s History of Adding Value To Modesto
PFM has had the privilege of serving as general financial advisor to the City since the late 1990s11, advising and working alongside staff on over 30 transactions including Lease Revenue Bonds (“LRB”), Wastewater Revenue Bonds and bank loans, Water Certificates of Participation (“COP”), Community Facilities District (“CFD”) Special Tax Bonds, State Revolving Fund (“SRF”) loans, as well as offering client training, annual debt policy review, support for the City’s annual rating surveillance meetings with Moody’s, Fitch and S&P, Letter of Credit (“LOC”) renewals and replacements, and capital projects financing and capacity analysis.

In the past three years, the engagements we have worked on with the City have included a 2019 LOC replacement in connection with outstanding 2008 LRBs, a 2020 LOC renewal for outstanding 2008 Water COPs, and a 2020 Wastewater Revenue Bond refunding of a $100 million outstanding SRF loan. Most recently, we have analyzed the potential impact on the City’s annual pension costs of issuing Pension Obligation Bonds and provided a presentation to City management to help educate them on the potential benefits and risks of this strategy. The nontransactional projects we have worked on with the City over the decades are too numerous to detail, but a sample list of our transactions with the City is provided below.

Selected List of PFM’s Modesto Transaction Experience
Year Project
1997 Wastewater Treatment Facility Revenue Bonds, Series 1997 1997 Lease Revenue Bonds Series 1997, John Thurman Field Renovation Project 1998 Multifamily Housing Revenue Refunding Bonds, 1998 Series A&B (Valley Oak Project) 1998 Baseball Stadium Financing
1998 Lease Revenue Bonds Series 1998, Capital Improvements & Refinancing Project 2000 Shadowbrook Apartments Multi-Family Housing Project 2000 Stanislaus WTE Solid Waste Facility Refund Revenue Certificates, Series 2000 2001 Live Oak Apartment Refunding
2003 Modesto Irrigation District 2003 Water Revenue Bonds 2005 Wastewater Revenue Refunding Bonds, Series 2005 A&B 2005 Community Facilities District No. 2003-1 (Fairview Village) Special Tax Bonds, Series 2005 11 PFM Financial Advisors LLC commenced operations on June 1, 2016, accordingly all client engagements that occurred prior to such date were effected through Public Financial Management Inc. #13..
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23 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report 2006 Wastewater Revenue Bonds, Series 2006A
2006 Water Revenue Certificates of Participation, 2006 Series A 2006 Community Facilities District No. 2004-1 (Village One #2) Special Tax Bonds, Series 2006 2007 Lease Revenue Refunding & Capital Improvement Bonds Series 2007 2008 Water Refunding Revenue Certificates of Participation, 2008 Series A 2008 Community Facilities District No. 2009-1 (Kiernan Business Park East) Special Tax Bonds Lease Revenue Refunding Bonds, Series 2008
2008 Multifamily Housing Revenue Refunding Bonds, 2008 Series A (Valley Oak Project) 2008 Lease Revenue Refunding Bonds Series 2008
2008 Refunding 1998 & 2007 Lease Revenue Bonds
2009 Turlock Irrigation District Drinking Water Project, Series 2009 2011 Water Refunding Revenue Certificates of Participation, 2008 Series A – Extension of Letter of Credit 2013 MID Domestic Water Project Refunding Revenue Bonds, Series 2013G 2014 Community Facilities District No. 2003-1 (Fairview Village) 2014 Special Tax Refunding Bonds 2014 Study of Siemens Self-Funding Clean Energy Project 2014 Community Facilities District No. 2004-1 (Village One #2) 2014 Special Tax Refunding Bonds 2014 Wastewater Refunding Revenue Certificates of Participation, 2008 Series A – Extension of Letter of Credit
2015 Privately Placed refunding of 2005A & 2006A Wastewater Revenue Bonds, Series 2015 2017 Water Refunding Revenue Certificates of Participation, 2008 Series A – Extension of Letter of Credit 2018 Wastewater Revenue Refunding Bonds, Series 2018A
2019 Lease Revenue Refunding Bonds Series 2008 – Replacement of Letter of Credit 2020 Wastewater Revenue Refunding Bonds, Series 2020A & 2020B 2020 Water Refunding Revenue Certificates of Participation, 2008 Series A – Extension of Letter of Credit Throughout our history of working with the City, PFM has striven to help guide the City through complex financings, challenging economic cycles, and changes in leadership, providing continuity and institutional memory along with the deep and varied expertise required by such a large, diverse, and evolving community as Modesto.

PFM as a Partner for Modesto’s Future
As a full-service city confronting a wide range of opportunities and challenges, Modesto continues to need a financial advisor with the depth and breadth of services to match. PFM is the firm with the knowledge and expertise to partner with the City to pursue the City Council’s goals as outlined in its Strategic Plan 2020-2025 and reaffirmed by its 2021-22 Strategic Budget Goals. The City’s key Areas of Focus, along with the specific goals that PFM and its affiliates can help the City to attain through services that we offer, are highlighted below:
 Area of Focus: Quality of Life
Where PFM can help: Improve Community Safety; Ensure Safe, Efficient, and Reliable Infrastructure
 Area of Focus: Economic Vitality
Where PFM can help: Drive Economic Vitality; Make Downtown Modesto a Destination
 Area of Focus: Governance and Service Delivery
Where PFM can help: Achieve Financial Sustainability
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24 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Below we illustrate the ways in which the specific services and expertise offered by PFM best qualify us to work with the City as your financial advisor as you pursue the Council’s adopted goals.

PFM’s Center for Justice and Safety Finance
With the improvement of community safety as a strategic goal of the City and the 2021 launch of the Forward Together initiative to improve police-community relations, Modesto’s commitment on public safety reform is clear. The Center for Justice and Safety Finance team within PFM’s affiliate, PFM Group Consulting LLC, offers the City expertise that can help produce better safety outcomes at lower cost to the City’s General Fund, a win-win result.

The Center for Justice & Safety Finance (“CJSF”), founded in 2017, combines PFM’s longstanding expertise in local government budgeting and operations with experience and leadership in criminal justice and public safety. With our one-of-a-kind focus on public sector clients, PFM is unique in its ability to provide thorough expert analysis and recommendations when it comes to criminal justice policy, operations and budgeting. Our approach underscores how public safety and criminal justice systems impact local government budgets and how financial and budget decisions can drive policy and operations. More importantly, it emphasizes how these essential systems affect people, families, and communities on a daily basis.

Police and corrections are usually among the most significant areas of spending for local government. In many places, local governments have over-invested in law enforcement as a response to crime and underinvested in strategies to build communities. As a result, in many cities and counties, spending on public safety and the criminal justice system is at or near 50% of the overall budget. We have successfully worked with local governments to better align budgeting with their broader justice and safety policy goals. As part of our work on multi-year budget planning and outcomes-based budgeting in local governments from Virginia to Illinois to Tennessee, we have crafted detailed initiatives designed to reduce the cost of policing and corrections to free funds for investments in programs designed to provide early interventions to economic challenges and inequity.

As Modesto seeks to improve community safety and quality of life through a combination of prevention and intervention efforts that address safety and its underlying issues, as well as to achieve financial sustainability, PFM’s affiliate, the Center for Justice and Safety Finance, can assist by:
• Conducting comprehensive criminal justice system and departmental reviews. • Supporting local governments in outcomes-based budgeting and the development of multi-year financial plans, with a focus on the costs of law enforcement and opportunities for alternative investments.
• Analyzing the role of fines and fees in the criminal justice system and develop plans that allow local governments to reduce reliance on them as a source of revenue. • Providing research and analysis for the development of new systems, policies and practices designed to improve law enforcement disciplinary processes and increase accountability.
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25 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report We believe our services complement the efforts being undertaken through the Forward Together initiative and can help the City maximize the effectiveness of the financial and other resources it devotes to public safety.

Premier National & California Water and Wastewater Practice As Modesto pursues its strategic
goal to ensure safe, efficient,
and reliable infrastructure,
PFM’s expertise in the water and
wastewater sector will continue to
make us a valuable partner to the
City as regulatory mandates,
climate change, technological
evolution, and other factors
continue drive the need for
continued investment in utility infrastructure. PFM is one of the nation’s leading financial advisors to water and wastewater issuers.12 Our level of transactional experience is unmatched, but it is important to note that PFM’s expertise goes beyond debt financing. We routinely advise on strategic matters, such as resource acquisitions, financial policies, and credit. Given the scale of the most recent Master Plan Capital Improvement Program cost estimates for the City’s Water system and Wastewater collection system, at $476 million and $218 million respectively, PFM’s expertise in developing and implementing financing plans to deliver large and complex
programs that combine
cash funding, public debt,
SRF loans, and other
financing mechanisms
such as the federal Water
Infrastructure Finance and
Innovation Act (“WIFIA”)
program, will continue to
benefit the City and its
ratepayers.

Our breadth of national
water and wastewater
experience extends over
into the California water
and wastewater sector
where PFM has worked
extensively over the last
decade – a period during
which water finance
12 Source: Ipreo, as of December 31, 2021. Based on par amount and number of transactions. 2021 Full Year Water Sewer & Gas Long Term Municipal New Issues Municipal Financial Advisory Ranking - Full Credit to Each Financial Advisor Source: Ipreo
# issues $ in millions
PFM 71
Hilltop Securities 69
Municipal Cap Mkts 5
Montague DeRose 11
Lamont Financial 5
Frasca & Associates 4
Acacia Fin Group 8
Baird 88
Public Resources 8
Swap Financial 1
7,042
4,980
2,948
1,974
1,670
1,635
1,580
1,344
1,305
1,061
PFM internal database, as of December 31, 2021
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26 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report changed dramatically. This provides our firm and team with an in-depth understanding of the challenges that Modesto faces. Our California clients run the spectrum of small local retail agencies to large wholesale agencies with expansive CIP programs and funding needs. This experience includes advising water and wastewater agencies such as the Metropolitan Water District of Southern California, Eastern Municipal Water District, Western Municipal Water District, Inland Empire Utilities Agency, Riverside Public Utilities, and Coachella Valley Water District. The map above illustrates this financial advisory experience.

As Modesto is aware, the federal Water Infrastructure Finance and Innovation Act (“WIFIA”) program is a funding alternative which can provide certain benefits over traditional financing methods, but also has certain considerations which need to be factored into any decision. PFM has assisted numerous water and wastewater clients in applying for, negotiating and executing WIFIA loans. Furthermore, we have also assisted several of our clients with further leveraging the benefit of the WIFIA loan program through the use of interim short-term notes which effectively lowers the overall cost of financing for the financed project.

Since the WIFIA program inception in 2017, PFM has advised clients on more than 20 loans totaling over $4 billion, as we highlight below.
13 13 PFM internal database, as of December 31, 2020.
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27 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Economic and Real Estate Consulting
Driving economic vitality and making downtown Modesto a destination are two more strategic goals that PFM and its affiliates are uniquely well-positioned to help the City achieve.

One current example of our ability to support the City in this area is the recent proposal to construct a downtown stadium and event center to replace John Thurman Field. A developer group has approached City management proposing a $100+ million publicly-funded stadium project to be supported by various development-driven taxes and other revenues. The City reached out to PFM seeking assistance in analyzing the unsolicited proposal, and within days our Economic and Real Estate Consulting (“ERC”) team had reviewed the analysis, provided a set of high-level questions for the developers, and outlined an approach for an independent review of the proposal. As is described further below, the ERC team has the specialized expertise to advise the City on this and other development projects as it seeks to drive economic vitality downtown and throughout the City.

The Economic and Real Estate Consulting team within PFM’s affiliate, PFM Group Consulting LLC, provides expert insight into challenges requiring economic impact analysis, econometric forecasting, and real estate market and feasibility review. Real estate and related economic analysis include: (i) market studies including the highest and best land use analysis, land use needs analyses for local government planning purposes, assessment of local market demand/supply and product absorption conditions; (ii) socio-economic data development supporting traffic and revenue studies, valuations for eminent domain issues, preferred route analysis, and mobility fee and impact fee analysis and (iii) economic growth forecasts, county and sub-county level housing and population forecasts, economic trend versus cycle analysis and economic effects of legislative initiatives and policy.

Impact analyses are very effective in helping drive successful negotiations for public-private partnership agreements and infrastructure funding. They include Fiscal Impact Analysis comparing government revenue streams with government expenditures. These studies are conducted at both the individual project level and at the municipal or countywide level, to test the fiscal sustainability of a proposed project or larger scale government land use plan.

Economic Impact Analyses include studies on the effects of economic activation, new jobs, wages and economic output, resulting from a wide variety of economic activities.

All services provided by the ERC team are provided under separate agreement with PFM Group Consulting LLC.

Economic Development and Public-Private Partnership Experience In addition to the work of the ERC as described above,
PFM’s experience with economic development tools and
strategies, including public-private partnerships, enables us to support the City in pursuit of its goal to drive economic vitality by identifying funding sources for economic
development opportunities, revitalizing neighborhoods, and supporting affordable housing. PFM has extensive
experience assisting our clients with the use of Community Facilities Districts (“CFDs”) and tax increment strategies #13..
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28 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report including Enhanced Infrastructure Financing Districts (“EIFDs”), on which we made a presentation to City staff in 2021.

One example of this work is our engagement with the Port of San Francisco, which has been a PFM client since 2007. Our initial efforts were focused on the development of a new capital planning process and an updated long-term capital plan. The Port then engaged PFM to provide assistance in the implementation of public financing techniques that will assist in the development of piers and other waterfront real estate that are currently in a deteriorated condition, in addition to evaluating financing strategies to address long-term infrastructure needs. Responsible for seven and onehalf miles of valuable San Francisco waterfront land, the Port is in the midst of several projects to transform vacant lots and crumbling piers into vibrant waterfront open space and mixed-use neighborhoods. Partnering with real estate developers, the Port is utilizing community facilities districts and infrastructure financing districts to fund public infrastructure improvements (streets, sidewalks, parks) and support the broader development plans. These financing tools are effective in spurring economic development, preserving historical sites, and generating future revenues for the Port while preserving the Port’s balance sheet and port revenue bond capacity.

In addition, PFM has created a planning model for the Port that projects financial forecasts in real time, allowing the Port to examine its long-term strategic financial health on a continuous basis. Most recently, we supported the Port and the
City and County of San Francisco on its first CFD
bond issuance in 2021 supporting the development
of the Mission Rock site (previously a large parking
lot) into a mixed-use development with open space
and parks. PFM assisted the City and County of San
Francisco in the 2021 issuance of its Mello-Roos
Special Tax Bonds for the Mission Rock Community Facilities District, which a mixed-use development project that will create up to 1,200 units of housing, 1.4 million square feet of new office space, and a new waterfront park across from Oracle Park. After more than a decade of planning, the Project is broke ground in 2021. A tax increment district was also formed over the area. Initially, CFD special assessment revenue will be utilized to pay CFD bond debt service.

However, it is expected that as the property value increases, tax increment revenues from the site will be utilized to repay the CFD bond debt service.

PFM has also been at the forefront of Public-Private Partnerships (“P3s”) since their introduction to the U.S. markets. PFM’s experience with public-private partnerships incorporates the evolving trends and terminology in P3s, ranging from design-build construction contracts to multi-decade concession agreements which encompass financing, design, construction, operations & maintenance, fee setting, and revenue sharing. PFM has substantial experience in assisting its clients with developing multi-year and multi-project P3 projects.

PFM has a national practice in P3, and thereby draws on a national base of information and experience that informs our work. Our lengthy experience with P3s has shown that there is not a one size fits all solution; each set of arrangements and financings must be customized to meet the needs of the context. Even among medium-sized local governments, there are significant variations in local conditions, and in the willingness and ability of the local jurisdictions to CFD Special Tax Bonds & Assessment
Bonds (Since January 2018)
California
Par Amount $479,363,848
Transactions 16
Source: CDIAC 12/1/2021
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29 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report manage the P3 process. We understand the need to clarify objectives, understand risk tolerance, and set out a clear evaluation process so that a reasonable set of choices can be understood, and a rational choice made. We add value by offering a completely independent and fair process for evaluating the potential use of P3s, ensuring that our clients have a clear understanding of their choices.

Pension Funding Analysis and Strategies
One of the recognized challenges the City faces as it pursues its goal to achieve financial sustainability is to address its growing pension funding cost. PFM understands that a key priority of the City for a number of years has been to address the growing cost of its unfunded pension liability, and it has taken important, concrete steps in this direction: the City’s operating reserve policy directs 1/3 of any annual General Fund surplus to be used to address the liability, and just weeks ago the City Council authorized the establishment of a Section 115 pension trust and approved initial funding of $2.3 million. Recognizing the importance of pension costs to both municipalities’ operations and their credit ratings, PFM has made this an area of special focus and we have significant experience advising clients on a range of strategies to address unfunded actuarial liabilities (“UALs”). Pension Obligation Bonds, which we have analyzed and discussed with the City over the past several years, are one potential tool, but only one of many and not the right one for all communities.

As is described in more detail in the Technical Specifications section of this proposal, we have evaluated the City’s pension UAL based on the most recent available information from CalPERS.

PFM’s recent pension related engagements include the Cities of Santa Rosa and Eureka, the Livermore Area Recreation and Park District, the Central Marin Sanitation Agency, the Central Contra Costa Sanitary District, and the Monterey Peninsula Airport District. In each of these engagements, PFM has prepared materials addressing alternative pension funding strategies and analyzed the potential benefits and risks associated with such strategies. Typical strategies include changing the UAL amortization method, additional funding from new and existing sources, additional funding from a POB, and interest rate sensitivity analysis. In addition, we evaluate individual UAL amortization bases to optimize savings from any funding strategy in a manner that the client’s savings objectives.

Regardless of what funding strategy or combination of strategies our clients ultimately choose to pursue in addressing their pension liability, PFM recommends that they adopt a pension funding policy to guide future resource allocation decisions. As we noted above, the rating agencies are squarely focused on the challenge presented by pension costs – Moody’s commented in its July 2021 review that “Modesto has an unfavorably high pension liability [that] is a weakness in comparison to its A1 rating” – and having a strong, Council-adopted pension funding policy in place is a credit positive. We have recently provided the City with a variety of sample pension policies as a starting point for discussion.

Client Training
In addition to being able to meet the scope of services discussed in the RFP, the City will have access to a wide network of educational training sessions offered by our PFM platform as we #13..
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30 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report believe that the best client is an informed client. We believe that the most successful clients are the ones that know what their financial advisor does and why we do it. In this regard, three times per year, we offer (free of charge) an intensive week-long training course for our clients. During this week, finance directors, treasurers and other senior staff from around the nation get together and spend a full day learning the intricacies of bond math, the pricing of bonds, investment techniques and arbitrage regulations. While we do not expect our clients to serve as their own financial advisors, we do feel that the most effective clients are those that understand how we operate and know how to use PFM to add value to their operation.

Quantitative Strategies Group (“QSG”)
Using advanced financial analysis and commercial and proprietary software, QSG develops customized solutions to meet the individual quantitative needs of all our clients. Our extensive quantitative capabilities allow us to provide services which address the full scope of strategic and operational considerations, ranging from capital financing strategies, to strategic planning and budgeting, to investment management strategies. Our Financial Risk Management, Structural Optimization, Refunding Efficiency, Forward Pricing, OPEB and Budget Projection Models, to name a few, assist us in achieving these objectives.

QSG also manages ongoing technical training for new and lateral hires, as well as current PFM employees. These range from training recordings on using both PFM-specific and industry-wide models and software to firm-wide webinars on high-level industry topics. Through “PFM University,” QSG provides a specific and mandatory training program for Directors and SMCs to increase technical knowledge base, improve sales, marketing, and presentation skills, and otherwise foster professional and personal growth. Additionally, QSG manages a library of learning materials, which the whole firm can access.

Research and Analytical Resources
PFM is a subscriber to a host of data and software providers that we regularly utilize to obtain information for our clients. PFM subscribes to several on-line services as well. These provide PFM with up-to-the-minute data on market conditions and allow our clients to take advantage of some of the most sophisticated market analysis available to properly structure and time the sale of their issues. These services include Bloomberg, which provides financial, economic and political information covering all market sectors, and TM3, which provides yield curves, benchmark scales, trading commentary, market conditions, and historical data on proprietary MMD curves. PFM also sources information from Ipreo, a centralized platform for municipal securities data and market information, and MMA, a research firm providing daily market commentaries and strategic analyses. At the same time, PFM maintains its own proprietary database of our financing experience, Ibis. PFM Research Group subscribes to premium content on Moody's, S&P, and Fitch’s websites and has access to Nielsen demographics for customized economic and demographic information. #13..
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VII. Technical Specifications
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Technical Specifications
PFM is fully prepared and uniquely well-suited to provide the full scope of services outlined in Technical Specifications portion of the City’s RFP in sections 1.2.1, 1.2.2, and 1.2.3, as is illustrated below.

1.2.1 Provide services related to the financial planning and policy development upon request of the City and as directed by the City Manager or his designee.

Weekly Market Updates
As is described in the Company History section earlier in our proposal, PFM advised our clients on an average of 18 transactions per week in 2021. Through this ongoing active participation in the markets and our dedicated Pricing Group, PFM is able to provide the City with timely and relevant information on developments in the general financial markets, and the municipal market in particular. This was particularly evident and valuable to the City as the COVID-19 pandemic hit in 2020 and roiled the markets, including the variable rate market in which the rates on the City’s 2008 Lease Revenue Bonds and 2008 Water COPs are set on a weekly basis. In March 2020, we began holding weekly calls with City staff, helping them to understand the potential impacts of the market volatility on the City’s variable rate bonds, swap mark-to-market valuations, and collateral posting requirements, and coordinating with the City’s Letter of Credit providers and remarketing agents. A sample of the Weekly Municipal Market Update that PFM distributes to our clients is attached in Appendix C.

Debt Policy and Profile
As we do with many of our clients, PFM reviews the City’s Debt Management Policy annually and suggest edits based on current market norms and rating agency expectations. This feedback assists the City in preserving and enhancing its ratings through the maintenance of strong financial policies that are responsive to the criteria used by the rating agencies in evaluating the City’s creditworthiness. We review our suggested changes with City staff and prepare a presentation to the Finance Committee and City Council summarizing the changes and the reasoning behind them.

We have a deep understanding of the Modesto’s financial position and debt portfolio given our long relationship with the City. We also have an up-to-date database of Modesto’s bonds in our debt profile model, which tracks all of the City’s bond issuances by series and by maturity. We use this tool to monitor the risks and opportunities relating to the debt portfolio, as well as to evaluate debt capacity and identify refinancing or restructuring opportunities. Having worked on dozens of Modesto transactions since 199714, PFM has a strong understanding of the legal and 14 PFM Financial Advisors LLC commenced operations on June 1, 2016, accordingly all client engagements that occurred prior to such date were effected through Public Financial Management Inc. #13..
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33 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report credit aspects of the City’s debt. The City’s current outstanding debt is summarized in the table below15:

Refunding Analysis
PFM does not currently identify any opportunities for refinancing of the City’s fixed rate debt for economic savings due to the small outstanding par amount of each currently callable bond series (under $10 million). However, there may be non-economic benefits to refinancing existing debt, such as the impending discontinuation of the London Inter-Bank Offered Rate (“LIBOR”) index by 2023. In light of this, PFM has examined fixed rate refinancings of the City’s variable bonds which have swaps tied to LIBOR, the 2008 Lease Revenue Refunding Bonds, the 2008 Water Revenue COPs, as well as the 2007F Modesto Irrigation District Index Rate Bonds, on which the City pays the debt service.

Fixing Out Variable Rate Bonds with LIBOR Swaps
Although the City may be able to pay a lower fixed rate on bonds issued in today’s market than it is currently paying on its fixed rate swaps, the City would also have to pay the swap’s 15 City of Modesto Annual comprehensive financial report, fiscal year ended June 30,2021 and Electronic Municipal Market Access, a service of the MSRB (https://emma.msrb.org/)
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report associated Mark-To-Market (“MTM”) termination value. Generally, when the fixed swap rate exceeds the refunding borrowing rate, the MTM termination value is negative, meaning that the City would have to pay to terminate the swap. This is because the MTM termination value represents the present value of all future payments due under the swap. The MTM calculation is designed to, ideally, ensure that each party is fairly compensated in the event the swap is terminated. This is because whichever party would have received more money from the future swap payments (net of the future swap payments they would have had to make) receives the present value of those net payments in today’s dollars at the time the swap is terminated. So in effect both parties should always be essentially financially indifferent between keeping the swap in place through its maturity versus receiving/paying the swap termination payment today and investing that termination payment in a similar investment. By design, this is why it is rarely in anyone’s financial interest to terminate a swap, unless there are other non-financial considerations such as budgetary needs, credit rating implications, defaults, political objectives, etc. It is also why savings cannot be generated through a refinancing of any of the City’s swapped bonds, because the swap termination payment is designed to almost exactly offset any debt service savings.

The results of our analysis of issuing fixed rate bonds to refinance the 2008 Lease Revenue Refunding Bonds, 2008 Water Revenue COPs, and 2007F Modesto Irrigation District Index Rate Bonds, including termination of the associated swaps, are summarized below:

Variable Rate Series Principal
Outstanding
Swap MTM
Termination
Value
Annual
Cashflow
Savings
Net Present
Value
Savings
2008 Lease Revenue Bonds $44,355,000 -$6,980,042 -$71,612 -$785,708 2008A Water Certificates of Participation $42,840,000 -$7,970,221 -$65,930 -$863,685 2007F Modesto Irrigation District $93,190,000 -$23,221,814 -$229,937 -$3,344,961 Estimates based on market conditions as of January 21, 2022.

As noted above, while issuing fixed rate bonds to refinance the City’s variable rate obligations is projected to produce dissavings on both a cashflow and net present value basis, there could be non-economic reasons to consider such a strategy. With a fixed rate structure, City staff would no longer be required to spend time on monitoring and managing the VRDBs and swaps – periodic Letter of Credit renewals, managing collateral posting requirements, preparing testing and projections for the financial statements, etc. While difficult to quantify, there is certainly value in reducing the administrative burden of managing the portfolio, and the City may consider it worthwhile to incur some level of cost to simplify the debt structure of these transactions and avoid future administrative time and costs.

Switching Variable Rate Indices
Although a refinancing may not generate economic benefit, there are other benefits to the City of removing its ties to on LIBOR before the index is phased out in 2023, including increased certainty and potentially lowering volatility by selecting an index which more closely tracks the variable rate that is paid on the bonds to investors. As a result, the City may consider negotiating with its swap counterparty to adjust its swap documents to remove LIBOR and replace it with a different index, such as the Secured Overnight Financing Rate (“SOFR”) or the #13..
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Securities Industry and Financial Markets Association (“SIFMA”) Municipal Swap Index. This would not require terminating the swap and thus the City would not have to pay a MTM termination, but depending on the index that replaces LIBOR it could result in a negotiation of altering the fixed rate that the City pays to swap counterparty. The City currently receives a floating rate of 63.7% of 1-Month LIBOR + 0.154% on its swaps. The two most common indices that could replace the City’s 1-Month LIBOR (“1ML”) index are 1-Month SOFR (“1MS”) or the Securities Industry and Financial Markets Association (“SIFMA”) Municipal Swap Index. We have graphed these below along with the actual variable rates paid on the City’s bonds back to April 2018, when SOFR was introduced by the Federal Reserve:

As shown in the graph above, the indices and the City’s bond rates move relatively similarly but there are noticeable differences16. For one, LIBOR is a taxable rate thus an adjustment factor must be used to approximate a tax-exempt municipal bond rate, in the City’s case this is 63.7% as memorialized in its swap documents. LIBOR is also based on daily surveys of bankers, not actual trade or loan data and is thus subject to manipulation; it is also not based on or tied directly to the tax-exempt municipal bond market and thus is not as correlated with the market as SIFMA (which is, by construction, a tax-exempt index of municipal bonds). SOFR is also a taxable rate, and although it is computed based upon actual trade data and thus not as subject to manipulation, the data is from the secured overnight transactions in the Treasury repurchase agreement market, not the tax-exempt municipal bond market. The averages of these indices and the City’s 2008A Water COPs and 2008 LRBs are summarized in the table below, along with their correlations indicating what percentage of the time the rates move in the same direction17:
16 Electronic Municipal Market Access, a service of the MSRB (https://emma.msrb.org/) 17 PFM Internal Database.

0.0 1.0

2.0 3.0

4.0 5.0

6.0 7.0

8.0 4/5/186/5/188/5/18
10/5/1812/5/18
2/5/194/5/196/5/198/5/19
10/5/1912/5/19
2/5/204/5/206/5/208/5/20
10/5/2012/5/20
2/5/214/5/216/5/218/5/21
10/5/2112/5/21
Rate (%)
Variable Rate History

63.7% * 1ML + 0.154% 63.7% * 1MS + 0.154% SIFMA 2008A Water 2008 LRB #13..
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Rate Average Since
April 2018
Correlation with
2008A Water COPs
Correlation with
2008 LRB

63.7% * 1ML + 0.154% 0.90% 78.4% 71.5%

63.7% * 1MS + 0.154% 0.91% 72.5% 64.6%
SIFMA 0.84% 97.1% 96.0%
2008A Water COPs 0.67% 100.0% 98.6%
2008 LRBs 0.75% 98.6% 100.0%
It is clear that SIFMA is by far the most correlated with the City’s variable rate 2008A Water COPs and 2008 LRBs, and that the use of either LIBOR and SOFR exposes the City to the volatility that comes with this decreased correlation. While these numbers and the downsides of decreased correlation may seem abstract, the spike in SOFR in the graph above illustrates the issue anecdotally: due to a confluence of factors unrelated to the municipal bond market, there was cash shortage in the Treasury repurchase agreement market on September 17, 2019, which caused the SOFR rate to more than double, increasing from 2.43% to 5.25% in one day.

After an emergency intervention by the Federal Reserve, the rate fell to 2.55% the next day.

The rate on the City’s variable rate bonds was completely unaffected. Although SIFMA has also increased sharply for brief periods of time in the past, these times are more likely to occur when rates on municipal bonds are also spiking, such as the beginning of the COVID-19 pandemic lockdown in March 2020 when the rates on the City’s 2008A Water COPs and 2008 LRBs bonds spiked from 1.18% to 4.90% and 6.75%, respectively, for two weeks before returning to normal. LIBOR and SOFR did not spike during this period, and thus the variable rate that the City received on its swaps (63.7% of 1-Month LIBOR + 0.154%) did not increase to match the increase in the interest rate on its bonds, effectively costing the City over $150,000 in net swap payments in 14 days. PFM set weekly calls with the City during this period to monitor its variable rates bonds, their interest rates, and communicated with the Remarketing Agent on the process of remarketing the bonds to investors at as low of a rate as possible.

Thus, lower correlation between the swap index and the variable rate bonds comes with increased risk and potentially periods of increased cost. Although it may require the City to agree to a higher fixed rate on its swap, it may be worth negotiating with the swap counterparty to attempt to replace its LIBOR index with SIFMA if the fixed cost of doing so is reasonable. Our swaps group estimates that if the City were to pursue switching its index from 63.7% of 1-Month LIBOR + 0.154% to SIFMA, it would likely have to pay the swap provider a higher fixed rate on the 2008A Water COPs and 2008 LRBs by approximately +0.33% and +0.42%, respectively.

This is because the forward curves for LIBOR and SIFMA, which represent the market’s expectation of where these rates will be in the future, suggest that the City would actually receive a higher amount of variable interest over the life of its bonds if it were paid SIFMA instead of 63.7% of 1-Month LIBOR + 0.154%. Therefore, these two effects largely cancel each other out, suggesting that the total cost to the City for switching to SIFMA over the life of the 2008A Water COPs and 2008 LRBs would be approximately $38,000 and $468,000, respectively. However, as compared to the significant dissavings associated with a refunding of the bonds as discussed earlier, this may be an attractive option.

Pension Funding Analysis
According to the City’s latest CalPERS valuation reports dated July 2021, as of 6/30/20 the funded status of the City’s two pension plans was as follows:
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report CalPERS
Plan
6/30/20 Market Value
of Assets
6/30/20 Unfunded
Accrued Liability
6/30/20 Funded
Ratio
Safety $427,296,928 $242,328,514 63.8%
Miscellaneous $357,764,151 $149,983,223 70.5%
Combined $785,061,079 $392,311,737 66.7%
Based on these valuation reports, the City’s payments on its Unfunded Accrued Liability (“UAL”) are scheduled to increase every year through FY31, from $23.16 million in FY21 to a peak of $41.43 million. However, these reports as of 6/30/20 do not incorporate the latest results from FY2021: CalPERS’ investment returns greatly exceeded their 7.0% target, achieving an impressive 21.3%, which increased the City’s assets and reduced the City’s UAL. At the same time, these strong returns also triggered CalPERS’ “risk mitigation policy” requiring a reduction in their discount rate from 7.0% to 6.8%, which increased the City’s total liability in today’s dollars. The net effect of these FY2021 events was still a beneficial one for the City, with its UAL decreasing by an estimated $81 million and its funded ratio increasing to an estimated 75%.

This will also have a significant effect on the City’s schedule of future payments to CalPERS, as payments are now projected to peak in FY2024 at $32.48 million (vs.FY2031 at $41.43 million) before dropping significantly, as shown in the graph below:

These beneficial FY2021 results will significantly reduce the City’s pension liability and make its pension burden more manageable from a budgetary perspective, as well as freeing up General Fund capacity which could be used to issue debt to finance projects such as the deferred $-
$5
$10
$15
$20
$25
$30
$35
$40
$45
2020 - 212021 - 222022 - 232023 - 242024 - 252025 - 262026 - 272027 - 282028 - 292029 - 302030 - 312031 - 322032 - 332033 - 342034 - 352035 - 362036 - 372037 - 382038 - 392039 - 402040 - 412041 - 422042 - 432043 - 442044 - 452045 - 462046 - 47 Annual Payment ($ Millions)
Fiscal Year Ending 6/30
CalPERS Pension Plans
(Source: CalPERS' Valuation Model)
Payments After FY21 Bases FY20 Valuation Payments
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report maintenance that PFM has previously worked with the City analyzing how to fund. However, the City may still benefit from further reducing its pension costs through Additional Discretionary Payments to CalPERS, deposits into a Section 115 Trust, or refinancing its UAL through the issuance of Pension Obligation Bonds (“POBs”).

PFM estimates that in the current market, a 2022 issuance of POBs to pay off the City’s entire estimated 6/30/22 UAL of $309 million would result in annual budgetary savings of $5.5 million in FY23 through FY37, for total budgetary savings in excess of $136 million. As we have previously discussed with this City, though, the issuance of POBs also comes with risks: the City would essentially be borrowing money at a fixed rate, which it must repay to bondholders, in order to invest it at the variable rate of CalPERS’ future investment returns. Historically, CalPERS’ returns have been much higher than taxable municipal bond rates on average, but there have been years where CalPERS’ investment returns significantly underperformed its target, and there have even been negative returns in several years (2009, 2008, 2002, 2001, 1984). The City is aware of these risks, as evidenced in the “CalPERS Unfunded Accrued Liability” slides presented by the City’s Director of Human Resources during an April 2021 budget workshop.

To help quantify and mitigate these risks, PFM has developed complex Monte Carlo models which simulate potential future POB performances under thousands of iterations of randomly chosen historical CalPERS investment returns. A sample output of such a model is below showing that, in this illustrative case, the client had a 78% probability of their POBs generating a financial benefit, and a 75% probability of generating a financial benefit in excess of $1 million.

However, as can be seen in the red bars in the graph below, there is a risk that issuing POBs fails to achieve a financial benefit and could cost the City a significant amount of money, especially if CalPERS has very poor investment returns in the years immediately following the issuance of the POBs, as this effect is compounded over time. If the City is interested in further exploring the use of POBs as part of its pension funding strategy, PFM is well prepared to provide the necessary analyses, both quantitative and qualitative, to assist the City in its decisionmaking.

Credit Rating Analysis
An improved pension funding and General Fund budgetary situation can have other positive effects for the City, such as bolstering its credit rating, which in turn would lower its cost of borrowing and reduce its future interest costs. As part of its non-transaction services, PFM has #13..
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report participated in many ratings surveillance processes with the City in connection with ongoing monitoring of its debt by Moody’s, Standard & Poor’s, and Fitch. PFM’s Quantitative Strategies Group has also developed and maintains Credit Calculator models, which incorporate the rating agencies’ latest published rating criteria and compute an indicative ratings based on the City’s current financial situation. These models can also be used to compute an indicative rating based on a hypothetical financial situation in order to evaluate the benefits and risks of potential financing strategies or budgetary decisions the City may consider, such as the issuance of General Fund backed debt (e.g., Lease Revenue Bonds or Pension Obligation Bonds).

Our analysis of the City’s current rating reports and of the output of the Credit Calculator model based on the City’s current General Fund financial data from the Annual Comprehensive Financial Report for June 30, 2021 suggest that the City may be able to achieve a “AA” category rating for its General Obligation debt from S&P based on their latest rating criteria, whereas its current General Obligation rating from Moody’s is only “A1” as of their July 2021 report. The output from our S&P Credit Calculator model is below, showing the multiple factors and their weights that combine to generate the overall indicative rating. Based on the strength and importance of these individual factors, we also provide a breakdown of the City’s credit positives and ways the credit rating could potentially improve:
*Rating provided for indicative purposes only, not a guarantee of a specific official rating Credit Positives Ways to Potentially Improve the Credit Worthiness or Score of the Rating
+ Solid economy
+ Full value significantly above US median
+ Low net direct debt to full value for rating
category
+ Healthy, although below median, fund
balance to operating revenues and cash
balance to operating revenues
+ Strong institutional framework score
+ Good management practices, with room
for improvement
• Comprehensive pension funding plan
• Improvement in financial management
policies and practices (based on 2021
policies)
o Adopt quarterly budget review
o Include long-term financial forecasts in
budget
o Further articulate reserve policy,
replenishment provisions, etc.
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report To the extent the City pursues a future General Fund debt issuance, such as for the fire station project PFM has previously analyzed for staff, we would suggest considering seeking a rating from S&P rather than Moody’s, which we expect would yield a stronger rating an accordingly, a lower borrowing cost. PFM would craft a rating presentation that specifically addresses S&P’s key considerations and highlights the City’s strengths in light of the criteria illustrated above, with the goal of achieving the most favorable possible rating outcome, which we believe could potentially be as high as “AA.”

1.2.2 Services related to debt transactions; provided that if the transaction is competitive, the services of the municipal advisor will be modified.

The bond issuance process is one which contains a number of distinct but inter-related steps.

Our goal at PFM is to lead our clients’ borrowings through these steps to allow for a seamless and successful execution. Our philosophy is to ensure that the City is kept involved (to any degree which you desire) and educated on each step in the process to ensure you understand and are informed for the decisions to be made.

For the sake of brevity, we have grouped the tasks within a transaction into six steps:

Step 1: Developing a plan of finance
Unless not already determined by a specific
recommendation, the first step within the transaction
process is development of the plan of finance. At
the outset, we will work with Roseville to (i)
determine the amount of borrowing necessary, and
(ii) analyze debt structuring alternatives and
determine the most appropriate method of sale
(negotiated, competitive or private placement). PFM
will convene an all-hands meeting as soon as
practical after the selection process is completed
and will lead a thorough and organized discussion
focused on the City’s specific goals and objectives
for the financing and on the long-term sustainability
of the City’s bond program.

Step 2: Assembling of the financing team and
managing the schedule
In our role as financial advisor, PFM has assisted
our clients in selecting financial services
professionals to the extent needed. These
professionals may include underwriters, bond
counsel, placement agents, verification consultants,
trustees, printing firms, bond insurance companies
and other debt issuance related providers. As the largest financial advisor in the nation, we have significant experience working with the major market participants including many of the team members Roseville has worked with in the past. With our understanding of market rates for fees, we are happy to assist as needed to negotiate fees with any existing team members or #13..
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Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report to assist the City in reevaluating its strategy. We will also create a schedule and efficiently manage the team to meet milestones.

Step 3: Preparation and review of authorizing documents and disclosure document We will make sure that the financing plan is properly developed and well-defined in advance of the drafting of documents, that the authorizing resolution accurately reflects the financing plan, and that the content of the financing plan is well communicated to City staff and to City Council.

PFM will assist the City and its disclosure counsel in the preparation and distribution of the preliminary and final official statements to provide the market with timely and accurate information about the City and any bond-related issues. The basic role of the financial advisor is to review and comment on the document before posting. At PFM, we play a larger role than that. Our standard practice is to help the City review and refine information for the sections of the document that address the financial operations of the City. Over time, we have been streamlining this process to make the development of preliminary official statements less burdensome on City staff.

Step 4: Development and implementation of credit and investor relations strategy With PFM’s national reach and our California-focused team for the City’s engagement, we have a strong understanding of the rating agency methodologies which drive bond ratings as well as the issues, concerns, and points of emphasis consistent with the City’s peers. We have developed specialized models to evaluate our local government clients’ credit based on the most recent rating criteria published by Standard & Poor’s, Moody’s, and Fitch, enabling us to assist in assessing the likely outcome of a rating process, as well as to evaluate the potential impact of financial and policy decisions on our clients’ credit ratings. PFM frequently discusses potential rating calibration changes with the rating agencies. This provides us additional insight into the evolution of their views and how current ratings may be affected. Later in this section we provide our analysis of the City’s credit quality and the key factors driving the ratings.

PFM is a strong proponent of a well thought-out, comprehensive investor relations program designed to stimulate investor demand and enable an issuer to achieve lower costs of borrowing. In order to maximize the benefits of an investor relations program, outreach must encompass both institutional and retail investors, and the tools and techniques used should be targeted to the specific — and sometimes markedly different — investment decision making processes and drivers of both groups. The strongest factors impacting investor demand are (i) level of investor awareness of the sale, and (ii) understanding of the issuers’ credit and bond structure. Both of these factors benefit from proactive, strategic issuer outreach, both ongoing and transaction specific. PFM would be available to assist the City and its Underwriter(s) in the preparation of investor presentations with the goal of providing relevant information needed in order to maximize investor participation in the City’s financings.

Step 5: Management of the bond sale process and the establishment of interest rates PFM’s Pricing Group provides pricing resources and negotiation support for PFM’s clients nationwide – continually enhancing, expanding and centralizing the firm’s bond pricing #13..
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42 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report expertise. The Pricing Group is in the market more than any financial advisor or underwriting firm, pricing on average 15-19 transactions each week18.

We use high-level quantitative analysis to develop our own price views, independent of the underwriters. We analyze historical and comparable transactions on a maturity-by-maturity basis using a variety of analytical methods. Beyond developing an interest-rate scale, we analyze different couponing structures, bond amortizations, and call features.

We communicate early and often with the underwriting team, to specifically discuss pre-sale marketing efforts and strategies to reach
target investors, offer our own separate
retail and institutional coupon and reoffering yield targets, and ensure that all parties are on the same page.

During the order period, we actively
monitor the sale of the debt, discuss the
orders and pricing strategy with the
underwriting team, and provide constant
feedback to the issuer. When negotiating
with underwriters, our suggested levels
are based on real data and real market
information to ensure that we are not
“chasing” the market later. Because the
PFM Pricing Group often has several
transactions in the market, we are
receiving up to the minute market
feedback and are communicating with multiple investment banks. Therefore, the issuer is not relying solely upon its senior manager. We also know which firms are putting their capital to work, what strategies they prefer, and how to ensure they will effectively price the City’s bonds.

Step 6: Assist with closing
We will assist with all aspects of closing including reviewing all closing documents and preparing a closing wire memorandum. We will manage the team to support a smooth preclosing and closing process. 18 Source: Ipreo, as of December 31, 2021
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43 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report

1.2.3 Additional Services
Produce annually derivative and investment valuation reports.

Swap Portfolio Monitoring and
Valuation Services19
PFMSA has developed
SwapViewer®, a risk management
platform for clients where they can
view positions and risk of their
swaps online. As soon as a trade
is transacted, it is captured in our
system for processing. Valuations
are performed on a daily basis,
and would be reported depending
on how often the City needs and
level of service required. The City would also have access to a website to view these valuations and transaction details. We maintain clients’ entire portfolio of swap positions in its database and provides them with regular mark-to-market reports. In addition, we maintain frequent contact with clients to provide them with market “color” and to alert them to current windows of opportunity.

SwapViewer® is a State-of-the-Art swap monitoring service for the Municipal and Tax-Exempt Market. In direct response to swap monitoring needs by clients like the City, PFM’s swaps group developed SwapViewer® as a cost effective, secure, Web-based platform for swaps tracking, monitoring and reporting. It has been tailored exclusively to meet the distinct needs of our local and state governments, non-profit and tax-exempt clients. SwapViewer® uses a combination of proprietary models and off-the-shelf derivative software to value the contracts. The market curves are captured each close of business, and valuations are processed daily. Standard risk terms such as Dollar Value of a Basis Point (DV01), which measures the dollar value change in an upward move in the yield curve, are captured for each transaction. Customized scenarios are produced by allowing for custom curves, and these rates are then applied on the contracts.

Swap portfolio monitoring, valuation and reporting services to the City would be led by our Director Alfred Mukunya and his team, utilizing SwapViewer® as the primary delivery tool along with our regular support for the City. SwapViewer® Services are distinguished by:
 Comprehensive service, around the clock access. SwapViewer® maintains your entire portfolio of swaps positions, processing your trades as presented, offering updates as needed, for access any time.
 A model of efficiency. With SwapViewer®, you get mark-to-market valuations, payments and cash flows, swap documents - no calculating, no data storage on your part.  Robust data. Users can access a summary view of aggregate swaps information, or drill down to find details of a specific transaction.
19 Sample provided for illustrative purposes only.
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44 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report  A trustworthy platform. SwapViewer® gives you access to the same sources of information used by PFM’s professional team - it’s password-protected.  User-friendly design. SwapViewer® combines robust information with ease of navigation and an intuitive user interface.
 Customized views. Powerful sorting and reporting functions enable you to manipulate data to meet individual analysis needs.

SwapViewer® provides automated email notification on the following:

1. Quarterly/Monthly Summary Report

2. Ongoing Valuations

3. Upcoming Payments

4. Collateral Event Status - e.g. if a threshold is hit, or a new collateral amount is required

5. Counterparty Rating Change - downgrade or upgrade

6. Custom Trigger Event - e.g. when transaction or portfolio hit a given valuation amount

7. Option Exercise Event
GASB 53 Compliance Services
PFMSA is one of the country’s leading swap advisor to municipals and not-for-profits with extensive experience implementing GASB 53 for large and small clients nationwide for fiscal years ending last June, September, and December20. Alfred Mukunya was an active member of the GASB Derivatives Instrument Advisory Committee that issued the Derivatives Implementation Guide which forms the basis of a comprehensive, practical outline on complying with the Statement. PFMSA goes the extra mile; for example in a past engagement, PFMSA led a 3-way call between GASB and a client’s auditor in order to pursue the best available accounting outcome for a client, which resulted in a liability of over $40mm receiving an offsetting deferral, rather than a loss as had been originally intended.

In addition, we have provided CPE credit eligible seminars on GASB 53 implementation that have been very helpful for clients and their auditors.

PFMSA is regulated by the SEC and put controls in place to help satisfy our fiduciary responsibility. The following are services we can provide to satisfy the City’s GASB 53 requirements:
 PFM swap advisory professionals can provide independent valuations and perform the required GASB 53 testing.
 Provide a concise report outlining the results and suggested Journal Entries.  Discuss in detail with accounting staff transition entries, and ongoing accounting.  Discuss with internal and external auditors the premise, methodology, and application of GASB 53 on a transaction by transaction basis.
20 Source: Ipreo, as of December 31, 2021
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45 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report  Prepare staff with board level reports and discussions on the higher level impact of GASB 53.
 Help prepare the footnote disclosures pursuant to GASB 53.

GASB 72 Compliance Services
In February 2015, GASB released Statement No. 72 that calls for the fair value of a liability to reflect the effect of non-performance risk, which would include a government’s own credit risk.

This is effective from periods beginning after June 15, 2015 and is a requirement for the City.

Engaging PFMSA would ensure the City would be ready for this Statement, as we are already automated for this requirement.

For reference, see link to the pronouncement:
http://gasb.org/jsp/GASB/Document_C/GASBDocumentPage?cid=1176165840291&acceptedDi sclaimer=true
GASB 72 clarifies and changes the definition of fair value, which used to be synonymous with mark-to-market. Fair value now is defined as an exit price at the measurement date. The fair value of a liability reflects the effect of non-performance risk, which includes (but may not be limited to) a government's own credit risk.

We are proud to report that PFMSA is already fully automated to handle the implementation of GASB 72 and we have been delivering GASB 72 Fair Value Reports as of June 30, 2016.

The methodology of computation is the same as that performed under Financial Accounting Standards Board (“FASB”) Topic Accounting Standards Codification 820 (“ASC 820”). We have been providing fair values and credit value adjustments to our clients in the healthcare, higher education, and non-profit sectors — as well as all swap clients that report under FASB — since the inception of ASC 820 in 2006. Therefore, City would benefit from this experience and robust system, which has been time-tested.

As an affiliate of PFM, the largest advisor of municipal debt nationwide according to Thomson Reuters21, and we believe PFMSA is best positioned to assess the relevant risk appropriate to a government issuer when computing the fair value. The methodology of computing swap fair values will change for all of PFMSA GASB clients with implementation of GASB 72. In addition to capturing the curves and data for computing mark-to-market, PFMSA will need to assess and capture the relevant yields for client counterparties and bank counterparties for computing fair value. We also will capture any credit support posted as of the calculation date. Computations and allocations of credit support must be performed and netted at the International Swaps and Derivative Association (“ISDA”) level, although calculations of mark-to-market are performed at the transaction level.

Taking into account nonperformance risk means tracking the relevant credit risk of the City, as well as each counterparty faced by the City on a given reporting date, and determining which risk would be appropriate to discount the expected cash flows. The mark-to-market values used before GASB 72 only use the risk free LIBOR swap curve that assumes no default. 21 Source: Ipreo, as of December 31, 2021
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46 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report If a transaction is a liability to the City, the system would use your relevant interest rate curve.

When a transaction is an asset, we use the bank counterparty’s relevant interest rate to compute the fair value. Depending on the observability of the inputs, the result is labelled with Level 1, 2, or 3. We anticipate all swap transactions to be Level 2, as has been all our transactions that report under ASC 820 – FASB’s version of Fair Value reporting that we have been providing for the last several years.

PFMSA serves various municipal clients who report under GASB. When these entities enter into transactions, they do so on a relatively small scale when compared to entities such as large financial institutions, which actively manage relatively large bond and swap portfolios, and by necessity have the infrastructure to evaluate risk. Therefore, a methodology that complies with GASB 72 should be practical in scope for PFM's swap advisory clients, and still meet the requirement of addressing and reporting on a transaction’s nonperformance risk.

Our swap monitoring, valuations, reporting, and hedge accounting services are led by Alfred Mukunya, an expert in the accounting for derivatives who was an active member of the GASB Derivatives Instrument Advisory Committee that developed the standards in this area. Mr.

Mukunya is a former partner and founder of the Pricing and Analytics group at the country’s largest independent swap advisor for corporate and taxable entities. He was also responsible for financial strategy, hedge analysis, and execution. In addition to high volume trade execution assistance to clients, Mr. Mukunya has extensive modeling, portfolio management, and reporting experience. He was also a risk manager for Citibank’s Interest Rate Derivatives desk in New York City. Our clients benefit from this expertise combined with advanced derivative pricing software. PFMSA has been providing swap valuations, monitoring, and GASB reporting to the City since 2010.

GASB 93 Compliance Services
In March 2020, GASB released Statement No. 93 to address accounting and financial reporting implications that result from the upcoming cessation of LIBOR. It outlines allowances and exceptions for LIBOR transition in order to continue with hedge accounting. The main items are (i) allowing for continuation of hedge accounting upon appropriate replacement of LIBOR and (ii) allowing for SOFR as a new benchmark. These two market events would have otherwise caused termination of hedge accounting, so this Statement clarifies and amends GASB 53. All other critical terms of the swap would have to remain the same, apart from the reference rate.

Engaging PFMSA would ensure the City would be ready for this Statement and a smooth transition from LIBOR, as we are already automated for SOFR and have walked several clients through adherence to the ISDA Fallbacks Protocol which would be a good start to complying with GASB 93 and continuation of hedge accounting.

For reference, see link to the pronouncement:
https://www.gasb.org/jsp/GASB/Document_C/DocumentPage?cid=1176174406911&acceptedD isclaimer=true
Additional Sample Reports are provided in Appendix C.
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47 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Provide historical and projected debt service costs for variable rate issuances that the City includes in the Annual Comprehensive Financial Report.

As City staff is aware, PFM maintains a Variable Rate Database model that we use to track the City’s variable rates it pays to its bondholders, the variable rates it receives on its swaps, and the fees it is paying for Letter of Credit and Remarketing Agent services associated with its variable rate bonds. This wealth of historical data allows us to analyze historical trends such as the range and average of the rates the City has paid on its bonds, received on its swaps, and in general how beneficial the swapped structure has been for the City compared to fixed rate bonds. At the time the City issued its variable rate bonds in 2008, the financial crisis and Great Recession were making it difficult to access the capital markets for its capital needs. Investors were wary and did not want to commit to long-term fixed interest rates, unsure of what the future would hold. The option to issue variable rate bonds (which allowed investors to commit to an interest rate for only a week at a time) along with a fixed rate swap (in which a swap counterparty committed to a fixed rate to be paid to it by the City, with a Mark-To-Market termination value built into the swap to make either side whole upon a termination), allowed the City to access the capital it needed at a reasonable “synthetic” fixed rate. At the time, this synthetic fixed rate was significantly lower than the fixed rate the City would have been able to achieve by issuing traditional fixed rate bonds. PFM has prepared several presentations for City staff and the City Council on this topic over the years, showing the historical performance of the City’s swapped variable rate bonds as compared to what it would have paid had it issued fixed rate bonds in 2008. These analyses continue to show that the synthetic fixed rate structure has worked to the City’s financial benefit.

In addition to tracking historical performance, PFM also uses the Variable Rate Database model to help the City project variable rate debt service costs into the future. We base projections both on historical performance and averages as well as forward curves, which represent the market’s perception of where variable rates will be in the future. City staff is also aware of this projection output of the model, as it has been used in the City’s financial statements for several years, most recently appearing in Note D on page 55 of the City’s Annual Comprehensive Final Report for the Fiscal Year Ended June 30, 2021. Below is the current projection provided by the model based on today’s market, along with the historical results:
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48 City of Modesto, California
Request for Proposal and Specifications No. 2122-01 for Municipal Advisory Services and Annual Derivative Valuation Report Year Ending
June 30, Principal Interest
Net Swap
Payments,
Letter of Credit,
and
Remarketing
Fees
Total
2008 0 3,546,784 -598,804 2,947,980
2009 290,000 3,059,237 5,373,732 8,722,969
2010 1,180,000 1,073,648 7,653,762 9,907,410
2011 1,305,000 1,090,743 7,555,827 9,951,570
2012 1,410,000 997,220 8,250,600 10,657,819
2013 1,570,000 974,570 8,326,863 10,871,432
2014 1,705,000 819,022 8,165,939 10,689,961
2015 1,845,000 788,186 7,938,112 10,571,297
2016 2,005,000 967,935 7,645,346 10,618,281
2017 2,200,000 1,811,336 6,701,362 10,712,698
2018 2,060,000 2,592,577 5,653,699 10,306,276
2019 2,255,000 3,385,035 4,484,339 10,124,375
2020 2,395,000 2,706,148 5,189,243 10,290,391
2021 2,565,000 787,133 6,875,877 10,228,010
2022 2,815,000 720,042 6,826,621 10,361,663
2023 3,035,000 755,137 6,667,268 10,457,405
2024 9,360,000 730,881 6,428,500 16,519,382
2025 9,855,000 694,427 6,057,642 16,607,069
2026 10,405,000 659,323 5,672,060 16,736,383
2027-2031 59,990,000 2,678,711 21,900,544 84,569,255
2032-2036 64,335,000 1,423,233 9,736,482 75,494,715
2037-2038 23,405,000 134,307 864,545 24,403,851
Projected
2022-2038 Total $183,200,000 $7,796,061 $64,153,661 $255,149,723 It is clear from the “Interest” column in the table above (which tracks the variable rate interest the City pays to its bondholders) that the rates on its bonds have moved around fairly significantly since 2008: first falling almost immediately to a low in 2015, as the Federal Reserve lowered short-term interest rates to combat the Great Recession; then steadily rising again during the economic recovery and increasing short-term interest rates through 2019; then falling again near the end of Fiscal Year 2019-2020 due to the financial crisis brought on by the COVID-19 pandemic and the resulting lowering of short-term interest rates by the Federal Reserve. However, the “Total” column, which includes the fixed rate interest the City has paid on its swaps (net of the variable rate interest it received), along with the ancillary costs for Letter of Credit and Remarketing Agent fees, has stayed relatively level since the first full fiscal year in which the bonds’ principal began amortizing (Fiscal Year 2009-2010). The fact that despite significant economic turmoil and multiple recessions the City’s “Total” annual payments associated with its variable rate bonds varied by less than $1 million, ranging from $9.91 - $10.87 million annually is evidence that the swap has served its purpose, effectively hedging the City’s variable rate bonds and resulting in an all-in payment that is fairly level. Our model’s projection is that this trend will continue until the principal on the 2007F MID Bonds starts amortizing on in Fiscal Year 2024, with its first principal payment on 9/1/2023. #13..
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Appendices
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A. Resumes
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Sarah Hollenbeck
Managing Director
PFM Financial Advisors LLC
Sarah serves as financial advisor to numerous cities throughout California. In the San Francisco Bay Area, she has worked with the cities of Alameda, Albany, Fairfield, Fremont, Lafayette, Martinez, Newark, Santa Rosa, San Francisco, San Leandro, San Rafael, South San Francisco, and Vallejo. She also advises clients in the utility and transportation sectors, including the Central Contra Costa Sanitary District, Central Marin Sanitation Agency, Bay Area Toll Authority and Sonoma-Marin Area Rail Transit District. She has advised her clients on over $10 billion of new money and refunding transactions, including general obligation bonds, certificates of participation, revenue bonds, pension obligation bonds, tax allocation bonds, limited obligation bonds, water and wastewater revenue bonds, and special tax bonds.

Sarah joined PFM after working for five years in the Mayor’s Office of the City and County of San Francisco, where she served as public finance manager. She has built upon her background as a city issuer to provide holistic, client-centered advice.

Contact
44 Montgomery Street
3rd Floor
San Francisco, C A 94104
[email protected]
415.982.5544 office
Specialties
Financial Advisory
State & Local Governments
Education
B.A. in History
Yale University
M.P.P.

University of California
Berkeley
Professional Designations
or Licenses
Municipal Advisor
Representative (Series 50)
Municipal Advisor Principal
(Series 54)
Started with PFM: 2001

RESUMES OF KEY PROFESSIONALS
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Nick Jones
Senior Managing Consultant
PFM Financial Advisors LLC
Nicholas joined PFM in 2010 and supports PFM’s services for a variety of municipal clients in the western United States. He provides transaction management support and technical and quantitative support for an array of clients, including the City and County of San Francisco, the San Diego Housing Commission, Sonoma-Marin Area Rail Transit District, and the cities of Palo Alto, Santa Rosa, Fairfield, Modesto, and San Jose.

His present duties include financial planning and modeling as well as analyzing the viability of debt issuances, structuring, sizing, and pricing new money and refinancing bond issues, reviewing and assessing issuers’ debt profiles, and performing analysis of restructuring opportunities.

Contact
44 Montgomery Street
San Francisco, C A 94104
[email protected]
415.982.5544 office
Specialties
Financial Advisory, Alternative
Finance
State & Local Governments,
Housing Authorities
Education
B.A. in Mathematical
Economics
with a minor in Cognitive
Science
Pomona College
Professional Designations
or Licenses
Municipal Advisor
Representative (Series 50)
Started with PFM: 2010
Started in the Field: 2010
NJ

RESUMES OF KEY PROFESSIONALS
#13..
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Christine Choi
Director
PFM Financial Advisors LLC
Christine brings over a decade of experience in capital planning, ongoing debt portfolio management, transaction management and strategic financial planning for municipal clients. During her tenure at PFM, Christine has been involved in the debt structuring and issuance of over $10 billion in bond issues. In addition to her significant transaction experience, Christine works with municipal entities on long-term capital planning, policy development and capacity analysis, public private partnerships relating to real estate development of publicly owned land, and credit strategy development. She identifies opportunities regarding market and legislative developments, financing ideas and sector trends.

Christine provides financial advisory project management for a variety of clients including the San Francisco International Airport, Port of San Francisco, State of Hawaii, the Hawaii Department of Transportation – Airports Division, the New Mexico Finance Authority, and the State of Oregon, among others.

Christine serves as Vice President of Asian Americans in Public Finance and Vice President (Programs) of Women in Public Finance, Northern California Chapter.

Contact
44 Montgomery Street
San Francisco, C A 94104
[email protected]
415.982.5544 office
Specialties
Financial Advisory, Alternative
Finance
State & Local Governments,
Transportation
Education
B.A. in Molecular and Cell
Biology
University of California
Berkeley
B.S. in Business
Administration
University of California
Berkeley
Professional Designations
or Licenses
Municipal Advisor
Representative (Series 50)
Started with PFM: 2007
Started in the Field: 2007

RESUMES OF KEY PROFESSIONALS
Retrieved January 27, 2022
#13..
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Darren Hodge
Director
PFM Financial Advisors LLC
Darren joined PFM in 2015 and serves as financial advisor to municipal entities in the Western U.S. focusing on public utility, state and local governments and transportation finance. Darren’s experience includes assisting his clients in the development and execution of long-term financial plans as well as assisting his clients in accessing both the private and public capital markets involving fixed and floating rate securities, interim financing products, and derivatives, among others.

Over his career he has worked with a variety of sectors including mass transit, public power, state and local governments, public power and water and wastewater, including others. Darren is also familiar with federal loan and grant programs having assisted his clients in securing low-cost financing through programs such as T IFIA and WIFIA. Darren has also assisted his clients in developing cost-effective interim financing solutions from commercial paper and lines of credit, to bank bridge financings and T IFIA Bond Anticipation Notes.

Before joining PFM, Darren spent over a decade as an investment banker, completing over $30 billion of transactions including public utility revenue bonds, sales tax revenue bonds, general obligation bonds, certificates of participations, tax and revenue anticipation notes, variable rate bonds.

Contact
1820 East Ray Road
Chandler, A Z 85225
[email protected]
855.885.9621 x2 office
Specialties
Financial Advisory
Public Power, Transportation,
State & Local Governments
Education
B.S. in Computer Science
University of California, Santa
Barbara
M.A. in Economics
University of California, Santa
Barbara
Professional Designations
or Licenses
Municipal Advisor
Representative (Series 50)
Started with PFM: 2015
Started in the Field: 2004

RESUMES OF KEY PROFESSIONALS
Retrieved January 27, 2022
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RESUMES OF KEY PROFESSIONALS
Grace Wang
Senior Analyst
PFM Financial Advisors LLC
Grace Wang joined PFM’s Financial Advisory team in 2018. Grace provides technical and quantitative support for several transportation clients and local governments. Her present duties include cashflow modeling, credit analysis, structuring, sizing, pricing new money and refunding bond issues, evaluating municipal issuers’ outstanding debt, and performing analysis of refunding opportunities.

Grace’s prior transactions included the issuance of general obligation bonds, sales tax revenue bonds, utility revenue bonds, and special tax bonds.

Contact
555 West 5th Street
Suite 3500
Los Angeles, CA 90013
[email protected]
213.415.1642 office
Specialties
Financial Advisory
Education
B.A. in Environmental
Economics and Policy
University of California,
Berkeley
Professional Designations
or Licenses
Municipal Advisor
Representative
(Series 50)
Started with PFM: 2018
Started in the Field: 2018
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RESUMES OF KEY PROFESSIONALS
Jordan Garcia
Analyst
PFM Financial Advisors LLC
Jordan Garcia joined PFM in 2021 and is currently staffed in the San Francisco office. Jordan’s work involves providing technical and quantitative support for a variety of clients including the State of Oregon, the City of Fairfield, the San Bernardino Association of Governments, the State of Hawaii, Washoe County RTC, RTC of Southern Nevada, and the San Diego Association of Governments.

Prior to joining PFM, Jordan worked at DoubleLine Capital, as a AnalystIntern for a year, running credit default model analyses and assisting traders.

Jordan graduated from UCLA as part of its first ever Benjamin Graham Value Investing Cohort Class. This program offered a select group of 45 commpetitive students the opportunity to study and learn applied case studies run by leading buy-side industry professionals.

Contact
44 Montgomery Street
3rd Floor
San Francisco, CA 94104
[email protected]
415.393.7228 office
Specialties
Financial Advisory
Education
B.A. in Economics
Concentration in Value Investing
Minor in Accounting
University of California, Los Angeles
Professional Designations
or Licenses
Registration pending for:

Municipal Advisor Representative
(Series 50)
Started with PFM: 2021
Started in the Field: 2021
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Todd Fraizer, CFA
Managing Director
PFM Financial Advisors LLC
Todd Fraizer is a managing director in the firm’s Charlotte office.

He leads PFM’s Pricing Group, which provides pricing resources and negotiation support for clients nationwide. He has assisted in pricing more than 3,000 transactions totaling more than $750 billion of municipal bonds for PFM issuer clients.

Prior to joining PFM, Todd was the vice president of finance for the Kansas Development Finance Authority. In this role, he served as the primary project manager for more than $2 billion of general purpose, higher education, pension obligation, transportation, and state revolving fund transactions. Before that, he gained futures and options trading experience while at the Kansas City Board of Trade.

Contact
11605 North Community House
Road
Calhoun Building
Suite 500
Charlotte, NC 28277
[email protected]
704.319.7921 office
Specialties
Financial Advisory
Education
B.A. in English Literature
University of Kansas
MB A in Finance
University of Missouri-Kansas
City
Professional Designations
or Licenses
Chartered Financial Analyst
(C FA)
Municipal Advisor
Representative (Series 50)
Started with PFM: 2005
Started in the Field: 1998

RESUMES OF KEY PROFESSIONALS
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Alfred Mukunya
Director
PFM Swap Advisors LLC
Alfred joined PFM in 2005 and leads PFM Swap Advisors LLC derivatives monitoring, accounting, and valuations business. He led the creation of SwapViewer®, which oversees reporting on more than $50 billion in swap and derivatives belonging to more than 100 different tax-exempt and municipal issuers, including general municipal, school districts, public utilities, higher education, and healthcare.

He was part of the Governmental Accounting Standards Board (GASB) Derivatives Instrument Advisory Committee, which issued the Derivatives Implementation Guide that provides a
comprehensive outline on complying with GASB 53. He provides Accounting Standards Code 820 reporting services for healthcare, higher education, and non-profit clients reporting under Financial Accounting Standards Board.

Prior to joining PFM Swap Advisors LLC, Alfred was trading and marketing derivatives as a Vice President in the Public Finance Group at a regional bank. Prior to that, he was a partner and head of the Structured Finance team at Chatham Financial, the leading taxable derivatives advisor in the nation. Alfred structured, advised, and executed hedging strategies for public and private real estate companies and investors.

Contact
1735 Market Street
42nd Floor
Philadelphia, PA 19103
[email protected]
215.557.1477 office
Specialties
Specialized Services,
Alternative Finance
State & Local Governments
Education
B.S.

University of Nairobi, Kenya
M.S. in Applied Economics and
Management
Cornell University
MB A in Finance
Wharton School at the
University of Pennsylvania
Professional Designations
or Licenses
Municipal Advisor
Representative (Series 50)
Started with PFM: 2005
Started in the Field: 1995

RESUMES OF KEY PROFESSIONALS
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George Hu
Senior Managing Consultant
PFM Swap Advisors LLC
George Hu provides technical analysis for PFM’s swap advisory business, focusing primarily on the incorporation of derivatives into tax-exempt debt management. He is responsible for modeling and pricing various forms of derivatives, including swaps, caps, collars, floors, and swaptions. He also performs risk/benefit analysis, manages swap dealer relationships, and ultimately ensures successful execution of interest rate hedges for various clients.

George joined PFM Swap Advisors LLC in 2007 as a member of the team specializing in swap valuations and reporting. He was part of the design and development team of SwapViewer®, PFM’s web-based platform for swaps monitoring, tracking and reporting.

He enhanced PFM’s proprietary swap pricing models, ensuring the integrity of client and market data in SwapViewer® and delivering client product support.

Prior to joining PFM, George was an engineering consultant working on analog and digital integrated circuit designs, including those for Global Positioning Systems (GPS).

Contact
1735 Market Street
42nd Floor
Philadelphia, PA 19103
[email protected]
215.557.1255 office
Specialties
Specialized Services
State & Local Governments,
Charitable Institutions
Education
B.S.E. in Electrical
Engineering
University of Pennsylvania
M.S.E. in Electrical
Engineering
University of Pennsylvania
Professional Designations
or Licenses
Municipal Advisor
Representative (Series 50)
Started with PFM: 2007
Started in the Field: 2007

RESUMES OF KEY PROFESSIONALS
#13..
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B. California Transaction List
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- 313 -
PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
01/04/2018 $3,805,000.00 City of Fairfield (CA) Negotiated Special Tax Bonds, Series 2018 (Villages at Fairfield) (Community Facilities District No. 2016-1) (Improvement Area A)
Gen Purpose/Pub Impt
01/11/2018 $45,705,000.00 Anaheim Housing and Public Improvements Authority (CA) Negotiated Sewer Revenue Bonds, Series 2018 Water & Sewer 01/11/2018 $8,635,000.00 Successor Agency to the Fortuna Redevelopment Agency (CA)
Negotiated Tax Allocation Refunding Bonds, Series 2018 (Fortuna Redevelopment Project)
Gen Purpose/Pub Impt
02/21/2018 $39,510,000.00 City of Redding (CA) Negotiated Electric System Refunding Revenue Bonds, Series 2018 Electric & Public Power 02/22/2018 $449,225,000.00 California Infrastructure and Economic Development Bank (CA)
Negotiated Clean Water State Revolving Fund Revenue Bonds, Series 2018 (Green Bonds)
Pollution Control
03/13/2018 $70,215,000.00 Northern California Power Agency (CA) Negotiated Revenue Refunding Bonds, 2018 Series B (Hydroelectric Project Number One)
Electric & Public Power
03/13/2018 $70,215,000.00 Northern California Power Agency (CA) Negotiated Revenue Refunding Bonds, 2018 Series A (Hydroelectric Project Number One)
Electric & Public Power
03/13/2018 $18,630,000.00 Millbrae Public Financing Authority Competitive 2018 Wastewater Revenue Bonds Water & Sewer 03/14/2018 $45,485,000.00 San Rafael Joint Powers Financing Authority (CA) Negotiated Lease Revenue Bonds, Series 2018 (Public Safety Facilities Project) (Green Bonds)
Fire Station & Equipment
03/20/2018 $11,340,000.00 City of Modesto (CA) Negotiated Wastewater Revenue Refunding Bonds, Series 2018A Water & Sewer 03/28/2018 $619,025,000.00 California Health Facilities Financing Authority Negotiated Revenue Bonds, Series 2018A (Sutter Health) Hospitals 04/03/2018 $54,965,000.00 Los Angeles County Metropolitan Transportation Authority (CA)
Competitive Proposition C Sales Tax Revenue Refunding Bonds Senior Bonds, Series 2018-A
Mass/Rapid Transit
04/04/2018 $537,480,000.00 San Diego County Regional Transportation Commission (CA)
Negotiated Subordinate Sales Tax Revenue Short-Term Notes (Limited Tax Bonds), 2018 Series A
Mass/Rapid Transit
04/04/2018 $16,905,000.00 San Luis Obispo County Financing Authority (CA) Negotiated Lease Revenue Refunding Bonds, Series 2018 Gen Purpose/Pub Impt 04/05/2018 $27,045,000.00 SLO County Financing Authority (CA) Negotiated Nacimiento Water Project Revenue Refunding Bonds, 2018 Series A Water & Sewer 04/19/2018 $573,100,000.00 Sacramento County (CA) Negotiated Airport System Subordinate Revenue Refunding Bonds, 2018F Airports 04/19/2018 $573,100,000.00 Sacramento County (CA) Negotiated Airport System Subordinate Revenue Refunding Bonds, Series 2018D
Airports
04/19/2018 $573,100,000.00 Sacramento County (CA) Negotiated Airport System Senior Revenue Refunding Bonds, Series 2018A Airports 04/19/2018 $573,100,000.00 Sacramento County (CA) Negotiated Airport System Subordinate Revenue Refunding Bonds, 2018E (Private Activity)
Airports
04/19/2018 $573,100,000.00 Sacramento County (CA) Negotiated Airport System Senior Revenue Refunding Bonds Series 2018B (Private Activity)
Airports
04/19/2018 $573,100,000.00 Sacramento County (CA) Negotiated Airport System Senior Revenue Refunding Bonds, Series 2018C Airports 05/03/2018 $46,140,000.00 Evergreen School District (CA) Negotiated 2018 General Obligation Refunding Bonds Primary & Secondary Education 05/03/2018 $46,140,000.00 Evergreen School District (CA) Negotiated General Obligation Bonds (Election of 2014), Series 2018 Primary & Secondary Education 05/03/2018 $228,915,000.00 Southern California Public Power Authority (CA) Negotiated Variable Rate Refunding Revenue Bonds, 2018 Series A (Fixed Tender Bonds - Term Rate Mode) (Canyon Power Project)
(Mandatory Tender Date: 05/01/2021)
Electric & Public Power
05/03/2018 $228,915,000.00 Southern California Public Power Authority (CA) Negotiated Variable Rate Refunding Revenue Bonds, 2018 Series B (Index Tender Bonds - SIFMA Mode) (Canyon Power Project) (Mandatory Tender Date: 05/01/2021)
Electric & Public Power
05/03/2018 $8,970,000.00 City of Palo Alto (CA) Negotiated 2018 Certificates of Participation (Capital Improvement Project; 2002B Refinancing) (Green Bonds)
Primary & Secondary Education
05/15/2018 $40,000,000.00 Lafayette School District (CA) Competitive General Obligation Bonds, Election of 2016, Series B (2018) Primary & Secondary Education 05/16/2018 $881,770,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Bonds, Series 2018F (San Francisco International Airport)
Airports
05/16/2018 $881,770,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Refunding Bonds Series 2018G (San Francisco International Airport)
Airports
05/16/2018 $881,770,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Bonds, Series 2018E (Governmental Purpose) (San Francisco International Airport)
Airports
05/16/2018 $881,770,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Bonds, Series 2018D (San Francisco International Airport)
Airports
1 of 9
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PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
05/22/2018 $40,000,000.00 Palo Alto Unified School District (CA) Competitive General Obligation Bonds (Election of 2008) Series 2018 Primary & Secondary Education 06/06/2018 $138,170,000.00 Airport Commission of the City and County of San Francisco
Negotiated Weekly Variable Rate Second Series Revenue Bonds, Series 2018B (Governmental Purpose) (San Francisco International Airport) (Letter of Credit Issued by: Barclays Bank PLC)
Airports
06/06/2018 $138,170,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Weekly Variable Rate Revenue Bonds, Series 2018C (Governmental Purpose) (San Francisco International Airport) (Letter of Credit Issued by Sumitomo Mitsui Banking Corporation) Airports
06/06/2018 $165,515,000.00 Sacramento Municipal Utility District (CA) Negotiated Electric Revenue Refunding Bonds, 2018 Series F Electric & Public Power 06/14/2018 $10,095,000.00 City of San Luis Obispo (CA) Negotiated Water Revenue Refunding Bonds, Series 2018 Water & Sewer 06/19/2018 $24,000,000.00 Campbell Union School District Competitive 2018 General Obligation Bonds (Series 2010G and Series 2016B Combined Issue)
Primary & Secondary Education
06/28/2018 $18,655,000.00 Successor Agency to the Redevelopment Agency of the City of Oakley (CA)
Negotiated Tax Allocation Refunding Bonds, Series 2018 Gen Purpose/Pub Impt 07/11/2018 $12,000,000.00 Los Altos School District Competitive 2018 Tax and Revenue Anticipation Notes Primary & Secondary Education 07/26/2018 $30,370,000.00 Oceanside Unified School District (CA) Negotiated 2018 General Obligation Refunding Bonds Primary & Secondary Education 08/02/2018 $6,610,000.00 Sacramento County (CA) Negotiated Special Tax Bonds, Series 2018 (Community Facilities District No. 2016-2) (Florin Vineyard No.1)
Gen Purpose/Pub Impt
08/08/2018 $40,740,000.00 California Educational Facilities Authority Negotiated Revenue Bonds, Series 2018B (Mount Saint Mary's University) Higher Education 08/08/2018 $40,740,000.00 California Educational Facilities Authority Negotiated Revenue Bonds, Series 2018A (Mount Saint Mary's University) Higher Education 08/15/2018 $19,450,000.00 Central Contra Costa Sanitary District Negotiated 2018 Wastewater Revenue Refunding Bonds, Series B Water & Sewer 08/15/2018 $19,450,000.00 Central Contra Costa Sanitary District Negotiated 2018 Wastewater Revenue Refunding Bonds, Series A Water & Sewer 08/17/2018 $64,470,000.00 Lincoln Community Facilities District No. 2003-1 (CA) Negotiated Special Tax Refunding Bonds, Series 2018 (Lincoln Crossing Project) Gen Purpose/Pub Impt 09/13/2018 $47,780,000.00 Eastern Municipal Water District (CA) Negotiated Variable Rate Refunding Water and Wastewater Revenue Bonds, Series 2018C (Mandatory Put Date - 10/01/2021)
Water & Sewer
09/13/2018 $53,485,000.00 Eastern Municipal Water District (CA) Negotiated Variable Rate Refunding Water and Wastewater Revenue Bonds, Series 2018B (Mandatory Tender Date - 10/01/2021) (LIBOR Index Rate)
Water & Sewer
09/13/2018 $48,535,000.00 Southern California Public Power Authority (CA) Negotiated Transmission Project Revenue Bonds, 2018 Subordinate Refunding Series A (Southern Transmission Project)
Electric & Public Power
09/26/2018 $94,455,000.00 Eastern Municipal Water District (CA) Negotiated Daily Variable Rate Refunding Water and Wastewater Revenue Bonds, Series 2018A (Mandatory Put Date: 09/28/2018)
Water & Sewer
09/27/2018 $20,000,000.00 Pittsburg Unified School District (CA) Negotiated General Obligation Bonds, Election of 2014, Series C (2018) Primary & Secondary Education 10/11/2018 $86,540,000.00 California Educational Facilities Authority Negotiated Revenue Bonds, Series 2018A (Green Bonds) (Loyola Marymount University)
Higher Education
10/11/2018 $86,540,000.00 California Educational Facilities Authority Negotiated Revenue Bonds, Series 2018B (Green Bonds) (Loyola Marymount University)
Higher Education
10/24/2018 $10,475,000.00 Victor Valley Transit Authority (CA) Negotiated 2018 Certificates of Participation (Transit Facilities Project) Mass/Rapid Transit 10/31/2018 $578,370,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Revenue Bonds, 2018 Series E (Los Angeles International Airport)
Airports
10/31/2018 $578,370,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Revenue Bonds, 2018 Series D (Los Angeles International Airport)
Airports
11/08/2018 $12,020,000.00 City of Fairfield (CA) Negotiated Special Tax Refunding Bonds, Series 2018 (Community Facilities District No. 3) (North Cordelia General Improvements)
Gen Purpose/Pub Impt
11/15/2018 $89,125,000.00 Sacramento County (CA) Negotiated Refunding Certificates of Participation, Series 2018A Gen Purpose/Pub Impt 11/15/2018 $89,125,000.00 Sacramento County (CA) Negotiated Refunding Certificates of Participation, Series 2018B Gen Purpose/Pub Impt 11/27/2018 $63,800,000.00 Mountain View Shoreline Regional Park Community (CA) Negotiated Revenue Bonds, Series 2018B Toll Roads/Highways/Streets 11/27/2018 $63,800,000.00 Mountain View Shoreline Regional Park Community (CA) Negotiated Revenue Bonds, Series 2018A Toll Roads/Highways/Streets 11/28/2018 $48,800,000.00 City of Santa Clara (CA) Negotiated Electric Revenue Refunding Bonds, Series 2018 A Electric & Public Power 2 of 9
#13..
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PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
12/04/2018 $402,105,000.00 Bay Area Toll Authority (CA) Negotiated Variable Rate San Francisco Bay Area Toll Bridge Revenue Bonds, 2018 Series C (SIFMA Index Rate) (Mandatory Tender Date:
04/01/2020)
Toll Roads/Highways/Streets
12/04/2018 $402,105,000.00 Bay Area Toll Authority (CA) Negotiated Variable Rate San Francisco Bay Area Toll Bridge Revenue Bonds, 2018 Series B (Term Rate) (Mandatory Tender Date: 04/01/2022) Toll Roads/Highways/Streets
12/04/2018 $402,105,000.00 Bay Area Toll Authority (CA) Negotiated Variable Rate San Francisco Bay Area Toll Bridge Revenue Bonds, 2018 Series A (Term Rate) (Mandatory Tender Date: 04/01/2026) Toll Roads/Highways/Streets
12/04/2018 $1,900,000.00 Earlimart Elementary School District (CA) Negotiated General Obligation Bonds, Election of 2016, Series B (2018) Primary & Secondary Education 12/04/2018 $14,720,000.00 City of Santa Rosa (CA) Negotiated Wastewater Revenue Refunding Bonds, Series 2018A Water & Sewer 12/04/2018 $15,325,000.00 City of Fairfield (CA) Negotiated Refunding Bonds, Series 2018 Pension/Retirement/Disability 12/04/2018 $8,910,000.00 City of Santa Rosa (CA) Negotiated Refunding Water Revenue Bonds, Series 2018 Water & Sewer 12/04/2018 $21,385,000.00 Belmont Joint Powers Financing Authority Competitive Sewer Treatment Facility Revenue Bonds, Series 2018 Water & Sewer 12/06/2018 $6,100,000.00 San Ramon Valley Unified School District (CA) Negotiated General Obligation Bonds, Election of 2012, Series 2018 Primary & Secondary Education 12/06/2018 $53,905,000.00 San Ramon Valley Unified School District (CA) Negotiated General Obligation Bonds, Election of 2012, Series 2018 Primary & Secondary Education 12/10/2018 $16,825,000.00 Northern California Energy Authority (CA) Negotiated Commodity Supply Revenue Bonds, Series 2018 Electric & Public Power 12/10/2018 $522,790,000.00 Northern California Energy Authority (CA) Negotiated Variable Rate Commodity Supply Revenue Bonds, Series 2018 (Mandatory Tender Date: 07/01/2024)
Electric & Public Power
01/11/2019 $1,763,565,000.00 Airport Commission of the City and County of San Francisco
Negotiated San Francisco International Airport Second Series Revenue Bonds, Series 2019C
Airports
01/11/2019 $1,763,565,000.00 Airport Commission of the City and County of San Francisco
Negotiated San Francisco International Airport Second Series Revenue Bonds, Series 2019B (Governmental Purpose)
Airports
01/11/2019 $1,763,565,000.00 Airport Commission of the City and County of San Francisco
Negotiated San Francisco International Airport Second Series Revenue Refunding Bonds Series 2019D (Private Activity)
Airports
01/11/2019 $1,763,565,000.00 Airport Commission of the City and County of San Francisco
Negotiated San Francisco International Airport Second Series Revenue Bonds, Series 2019A
Airports
01/24/2019 $48,605,000.00 Moulton Niguel Water District (CA) Negotiated 2019 Revenue Refunding Bonds Water & Sewer 02/05/2019 $114,215,000.00 City of Riverside (CA) Negotiated Water Revenue/Refunding Bonds, Issue of 2019A Water & Sewer 02/06/2019 $283,325,000.00 City of Riverside (CA) Negotiated Refunding Electric Revenue Bonds, Issue of 2019A Electric & Public Power 02/07/2019 $190,965,000.00 City and County of San Francisco (CA) Negotiated Special Tax Bonds, Series 2019A (Community Facilities District No. 2014-1) (Transbay Transit Center)
Gen Purpose/Pub Impt
02/07/2019 $190,965,000.00 City and County of San Francisco (CA) Negotiated Special Tax Bonds, Series 2019B (Green-Bonds) (Community Facilities District No. 2014-1) (Transbay Transit Center) Gen Purpose/Pub Impt
02/07/2019 $63,960,000.00 San Joaquin County Transportation Authority (CA) Negotiated Measure K Sales Tax Revenue Bonds, Series 2019 (Limited Tax Bonds)
Other Transportation
02/07/2019 $170,725,000.00 California Municipal Finance Authority (CA) Negotiated Revenue Bonds (National University), Series 2019A Higher Education 02/07/2019 $170,725,000.00 California Municipal Finance Authority (CA) Negotiated Revenue Bonds (National University), Series 2019B Higher Education 02/12/2019 $47,635,000.00 Peninsula Corridor Joint Powers Board Negotiated Farebox Revenue Bonds, 2019 Series A Electric & Public Power 02/20/2019 $6,595,000.00 Chatom Union School District (CA) Negotiated 2019 Refunding General Obligation Bonds Primary & Secondary Education 02/20/2019 $6,595,000.00 Chatom Union School District (CA) Negotiated 2019 Refunding General Obligation Capital Appreciation Bonds (Maturity Value)
Primary & Secondary Education
02/20/2019 $125,000,000.00 Airport Commission of the City and County of San Francisco
Negotiated Special Facilities Lease Revenue Bonds (SFO Fuel Company LLC), Series 2019B (San Francisco International Airport)
Airports
02/20/2019 $125,000,000.00 Airport Commission of the City and County of San Francisco
Negotiated Special Facilities Lease Revenue Bonds (SFO Fuel Company LLC), Series 2019A (San Francisco International Airport)
Airports
02/20/2019 $126,240,000.00 Bay Area Toll Authority (CA) Negotiated San Francisco Bay Area Subordinate Toll Bridge Revenue Bonds, 2019 Series S-H
Toll Roads/Highways/Streets
02/26/2019 $37,370,000.00 City of Palo Alto (CA) Negotiated 2019 Certificates of Participation, Series B (California Avenue Parking Garage)
Parking Facilities
02/26/2019 $37,370,000.00 City of Palo Alto (CA) Negotiated 2019 Certificates of Participation, Series A (California Avenue Parking Garage)
Parking Facilities
3 of 9
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PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
02/27/2019 $438,335,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Revenue Bonds, 2019 Series B (Los Angeles International Airport) (Governmental)
Airports
02/27/2019 $438,335,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Refunding Revenue Bonds, 2019 Series C (Los Angeles International Airport) (Private Activity)
Airports
02/27/2019 $438,335,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Revenue Bonds, 2019 Series A (Los Angeles International Airport) (Private Activity)
Airports
03/13/2019 $39,250,000.00 Northern California Power Agency (CA) Negotiated Hydroelectric Project Number One Revenue Bonds, 2019 Refunding Series A
Electric & Public Power
03/21/2019 $24,000,000.00 Hollister School District (CA) Negotiated General Obligation Bonds, Election of 2016, Series 2019B Primary & Secondary Education 04/02/2019 $57,745,000.00 Los Angeles County Metropolitan Transportation Authority (CA)
Competitive Proposition A First Tier Senior Sales Tax Revenue Refunding Bonds Series 2019-A
Mass/Rapid Transit
04/17/2019 $169,065,000.00 Anaheim Public Financing Authority (CA) Negotiated Senior Lease Revenue Refunding Bonds (Anaheim Public Improvements Project), Series 2019A
Gen Purpose/Pub Impt
04/17/2019 $6,500,000.00 Anaheim Public Financing Authority (CA) Negotiated Senior Lease Revenue Refunding Bonds (Anaheim Public Improvements Project), Series 2019 B
Gen Purpose/Pub Impt
04/24/2019 $74,170,000.00 California Municipal Finance Authority (CA) Negotiated Refunding Revenue Bonds, Series 2019 (William Jessup University) Higher Education 05/01/2019 $24,085,000.00 Redding Joint Powers Financing Authority (CA) Negotiated Lease Revenue Bonds (2019 Capital Projects), 2019 Series A Gen Purpose/Pub Impt 05/15/2019 $150,000,000.00 Fremont Union High School District (CA) Negotiated General Obligation Bonds, Series 2019C Primary & Secondary Education 05/15/2019 $150,000,000.00 Fremont Union High School District (CA) Negotiated General Obligation Bonds, Series 2019B (Green Bonds) Primary & Secondary Education 05/15/2019 $150,000,000.00 Fremont Union High School District (CA) Negotiated General Obligation Bonds, Series 2019A Primary & Secondary Education 05/16/2019 $11,025,000.00 Santa Rita Union School District (CA) Negotiated 2019 General Obligation Refunding Bonds Primary & Secondary Education 05/21/2019 $35,530,000.00 Contra Costa Water District (CA) Negotiated Water Revenue Refunding Notes, Series F Water & Sewer 05/22/2019 $41,040,000.00 Contra Costa Water District (CA) Negotiated Water Revenue Refunding Bonds, Series V Water & Sewer 06/11/2019 $433,145,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Revenue Bonds, 2019 Series D (Los Angeles International Airport)
Airports
06/11/2019 $433,145,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Revenue Bonds, 2019 Series E (Los Angeles International Airport)
Airports
06/12/2019 $1,450,000.00 Oceanside Unified School District (CA) Negotiated General Obligation Bonds, Election of 2008, Series 2019 Primary & Secondary Education 06/12/2019 $65,245,000.00 Imperial Irrigation District (CA) Negotiated Electric System Refunding Revenue Bonds, Series 2019 (Green Bonds)
Electric & Public Power
06/12/2019 $23,550,000.00 Oceanside Unified School District (CA) Negotiated General Obligation Bonds, Election of 2008, Series E Primary & Secondary Education 06/20/2019 $95,850,000.00 Modesto Irrigation District Financing Authority (CA) Negotiated Electric System Revenue Bonds, Series 2019A Electric & Public Power 06/20/2019 $95,850,000.00 Modesto Irrigation District Financing Authority (CA) Negotiated Electric System Refunding Revenue Bonds, Series 2019B Electric & Public Power 07/10/2019 $30,000,000.00 Palo Alto Unified School District (CA) Competitive General Obligation Bonds (Election of 2018), Series 2019 Primary & Secondary Education 07/11/2019 $15,000,000.00 Los Altos School District Competitive 2019 Tax and Revenue Anticipation Notes, Series A Primary & Secondary Education 07/11/2019 $15,000,000.00 Los Altos School District Competitive 2019 Tax and Revenue Anticipation Notes, Series B Primary & Secondary Education 07/16/2019 $191,875,000.00 Sacramento Municipal Utility District (CA) Negotiated Electric Revenue Bonds, 2019 Series G Electric & Public Power 07/16/2019 $200,000,000.00 Sacramento Municipal Utility District (CA) Negotiated Variable Rate Subordinated Electric Revenue Bonds, 2019 Series A (Mandatory Put Date: 10/17/2023)
Combined Utilities
07/16/2019 $200,000,000.00 Sacramento Municipal Utility District (CA) Negotiated Variable Rate Subordinated Electric Revenue Bonds, 2019 Series B (Mandatory Put Date: 10/15/2025)
Combined Utilities
07/25/2019 $203,270,000.00 Bay Area Toll Authority (CA) Negotiated San Francisco Bay Area Subordinate Toll Revenue Bonds, 2019 Series S-8
Toll Roads/Highways/Streets
07/30/2019 $335,000,000.00 San Diego Association of Governments (CA) Negotiated Capital Grant Receipts Revenue Bonds, Series 2019B (Green Bonds) (Mid-Coast Corridor Transit Project)
Mass/Rapid Transit
07/30/2019 $335,000,000.00 San Diego Association of Governments (CA) Negotiated Capital Grant Receipts Revenue Bonds, Series 2019A (Green Bonds) (Mid-Coast Corridor Transit Project)
Mass/Rapid Transit
07/31/2019 $100,000,000.00 Bay Area Toll Authority (CA) Negotiated Weekly Variable Rate San Francisco Bay Areal Toll Bridge Revenue Bonds, 2019 Series A (Letter of Credit Issued by: Bank of America, N.A.)
Toll Roads/Highways/Streets
4 of 9
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PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
07/31/2019 $52,200,000.00 Bay Area Toll Authority (CA) Negotiated Weekly Variable Rate San Francisco Bay Area Toll Bridge Revenue Bonds, 2019 Series C (Letter of Credit Issued by: Bank of America, N.A.)
Toll Roads/Highways/Streets
07/31/2019 $139,530,000.00 Bay Area Toll Authority (CA) Negotiated Weekly Variable Rate San Francisco Bay Area Toll Bridge Revenue Bonds, 2019 Series B (Letter of Credit Issued by: Sumitomo Mitsui Banking Corporation)
Toll Roads/Highways/Streets
07/31/2019 $139,530,000.00 Bay Area Toll Authority (CA) Negotiated Weekly Variable Rate San Francisco Bay Area Toll Bridge Revenue Bonds, 2019 Series D (Letter of Credit Issued by: Sumitomo Mitsui Banking Corporation)
Toll Roads/Highways/Streets
08/01/2019 $19,865,000.00 City of Fairfield (CA) Negotiated Special Tax Bonds, Series 2019A (Community Facilities District No. 2016-1) (Villages at Fairfield) (Improvement Area B)
Water & Sewer
08/14/2019 $1,189,175,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Bonds, Series 2019G (San Francisco International Airport)
Airports
08/14/2019 $1,189,175,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Bonds, Series 2019F (Governmental Purpose) (San Francisco International Airport)
Airports
08/14/2019 $1,189,175,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Refunding Bonds, Series 2019H (San Francisco International Airport)
Airports
08/14/2019 $1,189,175,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Bonds, Series 2019E (San Francisco International Airport)
Airports
09/10/2019 $51,620,000.00 California Educational Facilities Authority Negotiated Revenue Bonds, Series 2019 (Loyola Marymount University) Higher Education 09/10/2019 $18,000,000.00 Palo Alto Unified School District (CA) Competitive 2019-20 Tax and Revenue Anticipation Notes Primary & Secondary Education 09/12/2019 $34,835,000.00 Successor Agency to the Dissolved Redevelopment Agency of the City of Novato (CA)
Negotiated Tax Allocation Refunding Bonds, 2019 Series B Gen Purpose/Pub Impt 09/12/2019 $34,835,000.00 Successor Agency to the Dissolved Redevelopment Agency of the City of Novato (CA)
Negotiated Tax Allocation Refunding Bonds, 2019 Series A Gen Purpose/Pub Impt 09/12/2019 $9,640,000.00 City of Menlo Park (CA) Competitive 2019 General Obligation Refunding Bonds (2001 Election) Gen Purpose/Pub Impt 09/19/2019 $972,730,000.00 Bay Area Toll Authority (CA) Negotiated San Francisco Bay Area Subordinate Toll Bridge Revenue Bonds, 2019 Series S-9
Toll Roads/Highways/Streets
09/19/2019 $972,730,000.00 Bay Area Toll Authority (CA) Negotiated San Francisco Bay Area Toll Bridge Revenue Bonds, 2019 Series F-1 Bridges 09/25/2019 $92,655,000.00 Turlock Irrigation District (CA) Negotiated Revenue Refunding Bonds, Series 2019 Gen Purpose/Pub Impt 09/25/2019 $137,150,000.00 Turlock Irrigation District (CA) Negotiated Revenue Refunding Bonds, Series 2020 Gen Purpose/Pub Impt 09/25/2019 $61,315,000.00 Walnut Energy Center Authority (CA) Negotiated Revenue Refunding Bonds, 2019 Series A Electric & Public Power 09/26/2019 $144,000,000.00 Los Altos School District Negotiated General Obligation Bonds (Election of 2014), Series A-2 Primary & Secondary Education 09/26/2019 $144,000,000.00 Los Altos School District Negotiated General Obligation Bonds (Election of 2014), Series A-1 Primary & Secondary Education 09/26/2019 $144,000,000.00 Los Altos School District Negotiated 2019 General Obligation Bond Anticipation Notes Primary & Secondary Education 10/03/2019 $111,920,000.00 Southern California Public Power Authority (CA) Negotiated Refunding Revenue Bonds, 2019-1 (Milford Wind Corridor Phase I Project)
Electric & Public Power
10/16/2019 $88,790,000.00 Sacramento County Water Financing Authority Negotiated Revenue Bonds (Sacramento County Water Agency Zones 40 and 41 2019 Refunding Project), Series 2019
Water & Sewer
10/24/2019 $116,460,000.00 City and County of San Francisco (CA) Competitive Refunding Certificates of Participation, Series 2019-R1 (Multiple Capital Improvement Projects)
Gen Purpose/Pub Impt
11/06/2019 $64,570,000.00 Moulton Niguel Water District (CA) Competitive 2019 Certificates of Participation Water & Sewer 11/07/2019 $30,000,000.00 Campbell Union School District Competitive 2019 General Obligation Bonds (Series 2010H and Series 2016C Combined Issue)
Primary & Secondary Education
11/14/2019 $112,650,000.00 Solano Community College District (CA) Negotiated 2019 General Obligation Refunding Bonds Higher Education 11/19/2019 $20,925,000.00 City of Santa Cruz (CA) Competitive 2019 Water Revenue Bonds (Green Bonds) Water & Sewer 11/20/2019 $318,961,252.70 Coast Community College District (CA) Negotiated Election of 2012 General Obligation Capital Appreciation Bonds, Series 2019F
Higher Education
11/20/2019 $318,961,252.70 Coast Community College District (CA) Negotiated Election of 2012 General Obligation Bonds, Series 2019F Higher Education 11/20/2019 $318,961,252.70 Coast Community College District (CA) Negotiated 2019 General Obligation Refunding Bonds Higher Education 11/20/2019 $17,095,000.00 Belmont Joint Powers Financing Authority Competitive Sewer Revenue Bonds, Series 2019 Water & Sewer 11/21/2019 $11,655,000.00 Alameda-Contra Costa Transit District (CA) Negotiated 2019 Refunding Certificates of Participation Gen Purpose/Pub Impt 5 of 9
#13..
- 318 -
PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
11/26/2019 $27,165,000.00 Pittsburg Unified School District (CA) Negotiated 2019 General Obligation Refunding Bonds Primary & Secondary Education 11/26/2019 $3,815,000.00 Pittsburg Unified School District Finance Authority (CA) Negotiated 2019 General Obligation Revenue Bonds (Pittsburg Unified School District Bond Program)
Primary & Secondary Education
11/26/2019 $28,185,000.00 Pittsburg Unified School District Finance Authority (CA) Negotiated 2019 General Obligation Revenue Bonds (Pittsburg Unified School District Bond Program)
Primary & Secondary Education
12/05/2019 $442,620,000.00 San Diego County Regional Transportation Commission (CA)
Negotiated Sales Tax Revenue Bonds, (Limited Tax Bonds) 2019 Series A Other Transportation 12/05/2019 $31,400,000.00 Burlingame Financing Authority Competitive Lease Revenue Bonds, Series 2019 (Community Center Project) Gen Purpose/Pub Impt 12/10/2019 $897,055,000.00 Foothill / Eastern Transportation Corridor Agency (CA) Negotiated Toll Road Refunding Revenue Bonds, Series 2019A Toll Roads/Highways/Streets 12/12/2019 $20,450,000.00 Northern California Power Agency (CA) Negotiated Capital Facilities Revenue Bonds, 2019 Refunding Series A Electric & Public Power 12/12/2019 $33,690,000.00 Mountain House Public Financing Authority (CA) Negotiated Utility Systems Revenue Bonds, Series 2019B Water & Sewer 12/12/2019 $33,690,000.00 Mountain House Public Financing Authority (CA) Negotiated Utility Systems Revenue Bonds, Series 2019A Water & Sewer 01/29/2020 $74,820,000.00 San Diego County Regional Transportation Commission (CA)
Negotiated Sales Tax Revenue Bonds (Limited Tax Bonds), 2020 Series A (Green Bonds)
Toll Roads/Highways/Streets
02/04/2020 $70,445,000.00 Anaheim Housing and Public Improvements Authority (CA) Negotiated Revenue Refunding Bonds, Series 2020-B (Water System Refunding)
Water & Sewer
02/04/2020 $70,445,000.00 Anaheim Housing and Public Improvements Authority (CA) Negotiated Revenue Bonds, Series 2020-A (Water System Project) Water & Sewer 02/06/2020 $223,350,000.00 Anaheim Housing and Public Improvements Authority (CA) Negotiated Revenue Refunding Bonds, Series 2020-C (Electric Utility Distribution System Refunding)
Electric & Public Power
02/06/2020 $223,350,000.00 Anaheim Housing and Public Improvements Authority (CA) Negotiated Revenue Bonds, Series 2020-A (Electric Utility Distribution System Improvements)
Electric & Public Power
02/06/2020 $223,350,000.00 Anaheim Housing and Public Improvements Authority (CA) Negotiated Revenue Refunding Bonds, Series 2020-B (Electric Utility Distribution System Refunding)
Electric & Public Power
02/12/2020 $23,780,000.00 Port Commission of the City and County of San Francisco (CA)
Negotiated Refunding Revenue Bonds, Series 2020A Seaports/Marine Terminals 02/12/2020 $23,780,000.00 Port Commission of the City and County of San Francisco (CA)
Negotiated Refunding Revenue Bonds, Series 2020B Seaports/Marine Terminals 02/25/2020 $36,825,000.00 City of Vallejo (CA) Negotiated Water Revenue Refunding Bonds, Series 2020A Water & Sewer 02/25/2020 $36,825,000.00 City of Vallejo (CA) Negotiated Water Revenue Refunding Bonds, Series 2020B Water & Sewer 04/15/2020 $81,100,000.00 Southern California Public Power Authority (CA) Negotiated Refunding Revenue Bonds, 2020-1 (Magnolia Power Project A) Electric & Public Power 04/28/2020 $400,000,000.00 Sacramento Municipal Utility District (CA) Negotiated Electric Revenue Bonds, 2020 Series H Electric & Public Power 04/28/2020 $147,130,000.00 Southern California Public Power Authority (CA) Negotiated Daily Variable Rate Refunding Revenue Bonds,2020-3 (Magnolia Power Project A) (Letter of Credit Issued by U.S. Bank National Association)
Gen Purpose/Pub Impt
04/28/2020 $54,675,000.00 Southern California Public Power Authority (CA) Negotiated Refunding Revenue Bonds, 2020 Series A (Linden Wind Energy Project) (Green Bonds)
Electric & Public Power
05/07/2020 $81,820,000.00 City and County of San Francisco (CA) Negotiated Special Tax Bonds, Series 2020B (Community Facilities District No. 2014-1) (Transbay Transit Center) (Green Bonds)
Water & Sewer
05/13/2020 $274,310,000.00 Southern California Public Power Authority (CA) Negotiated Refunding Revenue Bonds, 2020-1 (Green Bonds) (Windy PointWindy Flats Project)Electric & Public Power 05/14/2020 $26,585,000.00 Southern California Public Power Authority (CA) Negotiated Revenue Refunding Bonds, 2020 Series A (Tieton Hydropower Project) (Green Bonds)
Electric & Public Power
05/20/2020 $122,145,000.00 Eastern Municipal Water District Financing Authority (CA) Negotiated Refunding Water and Wastewater Revenue Bonds, Series 2020A Water & Sewer 06/23/2020 $90,260,000.00 Western Municipal Water District Facilities Authority (CA) Negotiated Water Revenue Bonds, Series of 2020A Water & Sewer 06/24/2020 $56,255,000.00 Chino Basin Regional Financing Authority Negotiated Refunding Revenue Bonds, Series 2020A (Inland Empire Utilities Agency)
Combined Utilities
06/25/2020 $15,285,000.00 City of Fairfield (CA) Negotiated Special Tax Bonds, Series 2020A (Improvement Area No. 1, Community Facilities District No.2019-1, (One Lake))
Gen Purpose/Pub Impt
07/23/2020 $36,640,000.00 City of Glendale (CA) Competitive Water Revenue Bonds, 2020 Refunding Series Water & Sewer 6 of 9
#13..
- 319 -
PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
08/05/2020 $130,180,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Refunding Bonds, Series 2020 (San Francisco International Airport)
Airports
08/06/2020 $34,920,000.00 Modesto Irrigation District (CA) Negotiated Electric System Refunding Revenue Bonds, Series 2020 Electric & Public Power 08/13/2020 $79,705,000.00 Sacramento County (CA) Negotiated Airport System Senior Revenue Refunding Bonds, Series 2020 Airports 08/18/2020 $53,895,000.00 Santa Margarita/Dana Point Authority (CA) Negotiated Water and Wastewater Revenue Bonds, Series 2020A Water & Sewer 08/28/2020 $406,890,000.00 Hastings Campus Housing Finance Authority (CA) Negotiated Campus Housing Revenue Subordinate Convertible Capital Appreciation Bonds, Series 2020B (Maturity Value)
Multi-Family Housing
08/28/2020 $406,890,000.00 Hastings Campus Housing Finance Authority (CA) Negotiated Campus Housing Revenue Bonds, Series 2020A (Senior Current Interest Bonds)
Multi-Family Housing
09/10/2020 $88,245,000.00 Southern California Public Power Authority (CA) Negotiated Variable Rate Refunding Revenue Bonds, 2020 Series C (Canyon Power Project) (Fixed Tender Bonds - Term Rate Mode) (Mandatory Tender Date: 07/01/20250)
Electric & Public Power
09/10/2020 $112,995,000.00 Southern California Public Power Authority (CA) Negotiated Refunding Revenue Bonds, 2020 Series A (Canyon Power Project) Electric & Public Power 09/10/2020 $70,075,000.00 Southern California Public Power Authority (CA) Negotiated Refunding Revenue Bonds, 2020 Series B (Canyon Power Project) Electric & Public Power 10/07/2020 $17,135,000.00 City and County of San Francisco (CA) Negotiated Special Tax Bonds, Series 2020 (Improvement Area No, 1 Community Facilities District No. 2016-1 (Treasure Island) Gen Purpose/Pub Impt
10/15/2020 $27,080,000.00 Sacramento County (CA) Negotiated 2020 Refunding Certificates of Participation (Sacramento County Public Facilities Financing Corporation)
Gen Purpose/Pub Impt
10/21/2020 $122,970,000.00 Sonoma-Marin Area Rail Transit District Negotiated Measure Q Sales Tax Revenue Refunding Bonds, Series 2020A (Green Bonds)
Mass/Rapid Transit
10/22/2020 $9,115,000.00 Central Marin Sanitation Agency Competitive Revenue Bonds, Series 2020 Sanitation 10/26/2020 $52,420,000.00 City of Redding (CA) Negotiated Wastewater System Refunding Revenue Bonds, Series 2020 Water & Sewer 10/27/2020 $94,310,000.00 City of Modesto (CA) Negotiated Wastewater Revenue Refunding Bonds, Series 2020B Water & Sewer 10/27/2020 $94,310,000.00 City of Modesto (CA) Negotiated Wastewater Revenue Refunding Bonds, Series 2020A Water & Sewer 11/10/2020 $51,640,000.00 City of Santa Rosa (CA) Negotiated Wastewater Revenue Refunding Bonds, Series 2020B Water & Sewer 11/10/2020 $52,365,000.00 City of Santa Rosa (CA) Negotiated Wastewater Revenue Bonds, Series 2020A Water & Sewer 01/14/2021 $4,510,000.00 Lincoln Community Facilities District No. 2006-1 (Lakeside) (CA)
Negotiated Special Tax Refunding Bonds, Series 2021 (Improvement Area No. 1) Gen Purpose/Pub Impt 01/21/2021 $188,890,000.00 The Metropolitan Water District of Southern California (CA) Negotiated Water Revenue Bonds, 2021 Series A Water & Sewer 01/27/2021 $92,945,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Refunding Revenue Bonds, 2021 Series C (Los Angeles International Airport)
Airports
01/27/2021 $187,585,000.00 Foothill / Eastern Transportation Corridor Agency (CA) Negotiated Junior Lien Toll Road Refunding Revenue Bonds, 2021D Toll Roads/Highways/Streets 01/27/2021 $187,585,000.00 Foothill / Eastern Transportation Corridor Agency (CA) Negotiated Senior Lien Toll Road Refunding Revenue Bonds, Series 2021B Toll Roads/Highways/Streets 01/27/2021 $52,945,000.00 Foothill / Eastern Transportation Corridor Agency (CA) Negotiated Junior Lien Toll Road Refunding Revenue Bonds, Series 2021B Toll Roads/Highways/Streets 01/27/2021 $52,945,000.00 Foothill / Eastern Transportation Corridor Agency (CA) Negotiated Senior Lien Toll Road Refunding Revenue Bonds, Series 2021A Toll Roads/Highways/Streets 01/27/2021 $800,410,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Revenue and Refunding Revenue Bonds 2021 Series B (Governmental Purpose) (Los Angeles International Airport) Airports
01/27/2021 $800,410,000.00 Department of Airports of the City of Los Angeles Negotiated Subordinate Revenue and Refunding Revenue Bonds, 2021 Series A (Private Activity) (Los Angeles International Airport) Airports
02/03/2021 $42,600,000.00 City of Vallejo (CA) Negotiated Water Revenue Bonds, Series 2021A Water & Sewer 02/10/2021 $230,706,363.50 Tobacco Securitization Authority of Northern California (CA) Negotiated Tobacco Settlement Asset-Backed Refunding Bonds, Series 2021B1 Class 2 Senior (Sacramento County Tobacco Securitization Corporation)
Gen Purpose/Pub Impt
02/10/2021 $230,706,363.50 Tobacco Securitization Authority of Northern California (CA) Negotiated Tobacco Settlement Asset-Backed Refunding Capital Appreciation Bonds, Series 2021B-2 Class 2 Senior (Sacramento County Tobacco Securitization Corporation)
Gen Purpose/Pub Impt
02/10/2021 $230,706,363.50 Tobacco Securitization Authority of Northern California (CA) Negotiated Tobacco Settlement Asset-Backed Refunding Bonds, Series 2021A Class 1 Senior (Sacramento County Tobacco Securitization Corporation)
Gen Purpose/Pub Impt
7 of 9
#13..
- 320 -
PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
02/23/2021 $537,480,000.00 San Diego County Regional Transportation Commission (CA)
Negotiated Subordinate Sales Tax Revenue Short-Term Notes (Limited Tax Bonds), 2021 Series A
Toll Roads/Highways/Streets
03/02/2021 $361,685,000.00 Bay Area Toll Authority (CA) Negotiated Adjustable Rate Toll Bridge Revenue Bonds, 2021 Series B (Index Rate) (Mandatory Tender 04/01/2024)
Toll Roads/Highways/Streets
03/02/2021 $361,685,000.00 Bay Area Toll Authority (CA) Negotiated Adjustable Rate Toll Bridge Revenue Bonds, 2021 Series C (Index Rate) (Mandatory Tender 04/01/2026)
Toll Roads/Highways/Streets
03/02/2021 $361,685,000.00 Bay Area Toll Authority (CA) Negotiated Adjustable Rate Toll Bridge Revenue Bonds, 2021 Series A (Term Rate) (Mandatory Tender Date: 04/01/2028)
Toll Roads/Highways/Streets
03/02/2021 $349,205,000.00 Bay Area Toll Authority (CA) Negotiated Toll Bridge Revenue Bonds 2021 Series F-1 Toll Roads/Highways/Streets 03/03/2021 $79,305,000.00 Southern California Public Power Authority (CA) Negotiated Refunding Revenue Bonds, 2021-1 (Green Bonds) (Milford Wind Corridor Phase II Project)
Electric & Public Power
03/10/2021 $116,150,000.00 San Diego County Regional Transportation Commission (CA)
Negotiated Subordinate Sales Tax Revenue Bonds, 2021 Series B (Limited Tax Bonds)
Toll Roads/Highways/Streets
03/10/2021 $149,840,000.00 San Diego County Regional Transportation Commission (CA)
Negotiated Sales Tax Revenue Bonds, 2021 Series A (Limited Tax Bonds) Toll Roads/Highways/Streets 03/17/2021 $48,945,000.00 Modesto Irrigation District (CA) Negotiated Electric System Refunding Revenue Bonds, Series 2021 Electric & Public Power 03/24/2021 $52,995,000.00 California Educational Facilities Authority Negotiated Revenue Bonds (Chapman University), Series 2021A Higher Education 03/24/2021 $294,020,000.00 City of San Jose (CA) Negotiated Airport Revenue Refunding Bonds, Series 2021C Airports 03/24/2021 $134,060,000.00 City of San Jose (CA) Negotiated Airport Revenue Refunding Bonds, Series 2021B Airports 03/24/2021 $134,060,000.00 City of San Jose (CA) Negotiated Airport Revenue Refunding Bonds, Series 2021A Airports 03/24/2021 $101,505,000.00 City of Palo Alto (CA) Competitive 2021 Certificates of Participation (Public Safety Building) Govt/Pub Buildings 04/07/2021 $324,295,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Refunding Bonds, Series 2021B Airports 04/07/2021 $324,295,000.00 Airport Commission of the City and County of San Francisco
Negotiated Second Series Revenue Refunding Bonds Series 2021A Airports 04/07/2021 $222,810,000.00 Airport Commission of the City and County of San Francisco
Negotiated San Francisco International Airport Second Series Revenue Refunding Bonds, Series 2021C
Airports
04/13/2021 $22,255,000.00 San Joaquin Regional Rail Commission Negotiated Refunding Certificates of Participation (Ace Maintenance Facility Project)
Gen Purpose/Pub Impt
05/06/2021 $43,300,000.00 City and County of San Francisco (CA) Negotiated Development Special Tax Bonds, Series 2021A (Special Tax District No. 2020-1 (Mission Rock Facilities and Services))
Gen Purpose/Pub Impt
05/19/2021 $19,660,000.00 City of San Luis Obispo Community Facilities District No. 2019-1 (San Luis Ranch) (CA)
Negotiated Special Tax Bonds, Series 2021 Combined Utilities 05/19/2021 $12,000,000.00 Napa County Board of Education (CA) Negotiated 2021 Certificates of Participation Primary & Secondary Education 06/02/2021 $50,590,000.00 Eastern Municipal Water District (CA) Negotiated Refunding Water and Wastewater Revenue Bonds, Series 2021A Water & Sewer 06/02/2021 $48,040,000.00 Eastern Municipal Water District (CA) Negotiated Refunding Water and Wastewater Revenue Bonds, Series 2021B (Index Mode) (Mandatory Tender Date: 07/01/2024)
Water & Sewer
06/02/2021 $16,410,000.00 Burlingame Financing Authority Negotiated Storm Drainage Revenue Bonds, Series 2021 Flood Control/Storm Drain 06/09/2021 $74,900,000.00 West Basin Municipal Water District Negotiated Refunding Revenue Bonds, Series 2021A Water & Sewer 06/10/2021 $138,755,000.00 Anaheim Public Financing Authority (CA) Negotiated Lease Revenue Bonds, Series 2021 (Working Capital Financing) Gen Purpose/Pub Impt 06/15/2021 $42,890,000.00 Coachella Valley Water District (CA) Negotiated Revenue Certificates of Participation (Oasis Project), Series 2021B Water & Sewer 06/15/2021 $42,890,000.00 Coachella Valley Water District (CA) Negotiated Revenue Certificates of Participation (Oasis Project), Series 2021A Water & Sewer 06/16/2021 $3,895,000.00 Sacramento County (CA) Negotiated Special Tax Bonds, Series 2021 (Community Facilities District No. 2014-2) (North Vineyard Station No. 2)
Gen Purpose/Pub Impt
06/16/2021 $50,570,000.00 Central Contra Costa Sanitary District Competitive 2021 Wastewater Revenue Certificates of Participation Sanitation 06/22/2021 $12,875,000.00 Livermore Area Recreation and Park District (CA) Negotiated 2021 Pension Obligation Bonds Pension/Retirement/Disability 06/23/2021 $23,770,000.00 California Municipal Finance Authority (CA) Negotiated Revenue Bonds, Series 2021 (Concordia University Irvine) Higher Education 06/23/2021 $106,875,000.00 Sacramento Municipal Utility District (CA) Negotiated Electric Revenue Refunding Bonds, 2021 Series I Combined Utilities 08/03/2021 $90,380,000.00 Contra Costa Water District (CA) Negotiated Water Revenue Refunding Bonds, Series W Water & Sewer 08/05/2021 $35,475,000.00 Sacramento Regional Transit District Negotiated Revenue Refunding Bonds Series 2021A Other Transportation 8 of 9
#13..
- 321 -
PFM California Transaction List
2018 - 2021
Sale
Date
Par Amount Issuer Offering
Type
Series Series of Issue Use of Proceeds
09/09/2021 $1,234,720,000.00 California Community Choice Financing Authority (CA) Negotiated Clean Energy Project Revenue Bonds, Series 2021B-2 (Green Bonds) (Mandatory Tender Date: 08/01/2031)
Combined Utilities
09/09/2021 $1,234,720,000.00 California Community Choice Financing Authority (CA) Negotiated Clean Energy Project Revenue Bonds Series 2021B-1 (Term Rate) (Green Bonds) (Mandatory Tender Date: 08/01/2031)
Combined Utilities
09/30/2021 $11,825,000.00 City of Fairfield (CA) Negotiated Special Tax Bonds, Series 2021A (Improvement Area No. 1) (Community Facilities District No. 2019-1) (One Lake)
Gen Purpose/Pub Impt
10/20/2021 $18,700,000.00 Los Angeles County Development Authority (CA) Negotiated Multifamily Housing Mortgage Revenue Bonds, (The Salvation Army Pasadena Hope Center Apartments) Series 2021G (Mandatory Tender Date: 05/01/2024)
Multi-Family Housing
10/21/2021 $64,280,000.00 City and County of San Francisco (CA) Negotiated Development Special Tax Bonds, Series 2021C (Mission Rock Facilities and Services) (Special Tax District No. 2020-1) Gen Purpose/Pub Impt
10/21/2021 $64,280,000.00 City and County of San Francisco (CA) Negotiated Development Special Tax Bonds, Series 2021B (Mission Rock Facilities and Services) (Special Tax District No. 2020-1) Gen Purpose/Pub Impt
11/04/2021 $24,825,000.00 City of Burbank (CA) Negotiated Burbank Water and Power Water Revenue/Refunding Bonds, Series of 2021
Water & Sewer
11/17/2021 $22,880,000.00 City of Fairfield (CA) Negotiated Special Tax Bonds, Series 2021A (Improvement Area C Community Facilities District No 2016-1) (Villages of Fairfield)
Gen Purpose/Pub Impt
12/01/2021 $250,250,000.00 Anaheim Public Financing Authority (CA) Negotiated Lease Revenue Bonds, Series 2021A (Convention Center Refunding) Civic & Convention Centers 12/02/2021 $56,495,000.00 Moulton Niguel Water District (CA) Competitive 2021 Certificates of Participation Water & Sewer 12/07/2021 $276,715,000.00 Bay Area Toll Authority (CA) Negotiated Weekly Variable Rate Toll Bridge Revenue Bonds, 2021 Series E (Index Rate) (San Francisco Bay Area)
Bridges
12/07/2021 $276,715,000.00 Bay Area Toll Authority (CA) Negotiated Weekly Variable Rate Toll Bridge Revenue Bonds, 2021 Series D (Index Rate) (San Francisco Bay Area)
Bridges
12/07/2021 $22,355,000.00 Eastern Municipal Water District Financing Authority (CA) Negotiated Refunding Revenue Bonds, Series 2021 (Eastern Municipal Water District Improvement Districts) (General Obligation Refunding Bonds) Water & Sewer
12/07/2021 $338,500,000.00 Bay Area Toll Authority (CA) Negotiated San Francisco Bay Area Toll Bridge Revenue Bonds, 2021 Series F-2 Bridges 12/08/2021 $96,245,000.00 San Joaquin Hills Transportation Corridor Agency (CA) Negotiated Senior Lien Toll Road Refunding Revenue Bonds, Series 2021A Toll Roads/Highways/Streets 12/08/2021 $605,065,000.00 San Joaquin Hills Transportation Corridor Agency (CA) Negotiated Senior Lien Toll Road Refunding Revenue Bonds, Series 2021B Toll Roads/Highways/Streets 12/08/2021 $635,740,000.00 Bay Area Toll Authority (CA) Negotiated San Francisco Bay Area Subordinate Toll Bridge Revenue Bonds, 2021 Series S-10
Bridges
12/08/2021 $635,740,000.00 Bay Area Toll Authority (CA) Negotiated San Francisco Bay Area Toll Bridge Revenue Bonds, 2021 Series F-3 Bridges 12/08/2021 $74,280,000.00 Public Utilities Commission of the City and County of San Francisco (CA)
Competitive Power Revenue Bonds, 2021 Series A (Green Bonds) Electric & Public Power 12/08/2021 $49,720,000.00 Public Utilities Commission of the City and County of San Francisco (CA)
Competitive Power Revenue Bonds, 2021 Series B Electric & Public Power 9 of 9
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C. Sample Reports
#13..
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© PFM 1
PFM Pricing Group
Weekly Municipal Market Update
Week of January 24, 2022
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© PFM 2
Table of Contents
I. Market Interest Rate Movements Page 2
II. Supply and Demand Page 7
III. Tax-Exempt Ratios Page 12
IV. Curves and Spreads Page 14
V. Upcoming Week Calendars Page 16
VI. Summary of Sales Results Page 18
PFM Pricing Group
01/17/2022 through 01/21/2022
Note: Full details of deals >$10MM pricing 01/17/2022 - 01/21/2022 included as separate file. #13..
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© PFM 3
Spot Rates
I. Market Interest Rate Movements
PFM Pricing Group
Source: Thomson Reuters

0.00%

0.25%

0.50%

0.75%

1.00%

1.25%

1.50%

1.75%

2.00%

2.25%

2.50%

2.75%

3.00%

3.25%

3.50%

3.75%
0 5 10 15 20 25
Yield
Maturity
Current 1 Week Ago 1 Month Ago 1 Year Ago
MMD AAA G.O. Curve
Spot Rates Current 1 Week Ago 1 Month Ago 1 Year Ago
2-Year 0.58% 0.46% 0.24% 0.14%
5-Year 0.91% 0.81% 0.59% 0.26%
7-Year 1.13% 1.03% 0.87% 0.47%
10-Year 1.28% 1.18% 1.03% 0.78%
30-Year 1.72% 1.64% 1.48% 1.45%
Change in Spot Rates
Current vs 1 Week Ago 1 Month Ago 1 Year Ago
2-Year 12 bps 34 bps 44 bps
5-Year 10 bps 32 bps 65 bps
7-Year 10 bps 26 bps 66 bps
10-Year 10 bps 25 bps 50 bps
30-Year 8 bps 24 bps 27 bps
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© PFM 4
I. Market Interest Rate Movements
PFM Pricing Group
Source: Thomson Reuters
#13..
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© PFM 5
Spot Rates
I. Market Interest Rate Movements
PFM Pricing Group
Source: Thomson Reuters

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%
1 2 3 4 5 6 7 8 9 10 11
Yield
Maturity
MMD Range Current MMD Average MMD
MMD Ranges Over Past 10 Years
10 20
30 40

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%
Spread in Basis Points
Yield
10-Year AAA MMD 10 Year A To AAA Spread
Rate and Spread Movement
MMD Ranges Over Past 10 Years
Current 10yr Avg vs. 10yr Avg Min Max
2-Year 0.58% 0.70% -12 bps 0.05% 2.52%
5-Year 0.91% 1.12% -21 bps 0.16% 2.56%
7-Year 1.13% 1.45% -32 bps 0.36% 2.64%
10-Year 1.28% 1.83% -55 bps 0.58% 3.04%
30-Year 1.72% 2.69% -97 bps 1.27% 4.51%
Rate and Spread Movement
Current Last Week Last Month Last Year
10-Year
AAA MMD 1.28% 1.18% 1.03% 0.78%
10-Year A to
AAA Spread 22 bps 22 bps 22 bps 33 bps
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© PFM 6
Spot Rates
I. Market Interest Rate Movements
PFM Pricing Group
Source: Bloomberg, Thomson Reuters

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%
Yield
10-Year BVAL AAA 10-Year AAA MMD 10-Year Treasury 30-Year BVAL AAA 30-Year AAA MMD 30-Year Treasury 10 Year and 30 Year Spot Rates
10-Year Rates 30-Year Rates
Current Last Week Last Month Last Year Current Last Week Last Month Last Year MMD 0.00% 1.28% 1.03% 0.78% MMD 0.00% 1.72% 1.48% 1.45% Treasury 1.76% 1.79% 1.46% 1.11% Treasury 2.07% 2.12% 1.86% 1.87% MMD/TSY 0% 72% 70% 70% MMD/TSY 0% 81% 79% 77%
BVAL 1.31% 1.23% 1.05% 0.76% BVAL 1.78% 1.71% 1.54% 1.54% #13..
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© PFM 7
Spot Rates
I. Market Interest Rate Movements
PFM Pricing Group
Source: Bloomberg, Thomson Reuters

0.00%

0.25%

0.50%

0.75%

1.00%

1.25%

1.50%

1.75%

2.00%

2.25%

2.50%

2.75%

3.00%

3.25%

3.50%

3.75%

4.00%

4.25%

4.50%

4.75%

5.00%

5.25%

5.50%

5.75%

6.00%

6.25%

6.50%

6.75%

7.00%

7.25%

7.50%

7.75%
Yield

SIFMA LIBOR VRD SOFR
Short-Term Spot Rates
Short-Term Spot Rates
Current Average Minimum Maximum Current Average Minimum Maximum SIFMA 0.04% 0.27% 0.02% 5.20% SOFR 0.05% 0.16% 0.01% 1.64% VRD 0.02% 0.23% 0.00% 7.41% LIBOR 0.07% 0.18% 0.05% 1.58% #13..
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© PFM 8
Spot Rates
II. Supply and Demand
PFM Pricing Group
Source: Investment Company Institute (ICI)
0 2.5
5 7.5
10 12.5
15 17.5
20 22.5
25 44 45 46 47 48 49 50 51 52 1 2 3
Billions
Weeks
2020 Tax-Exempt 2020 Taxable 2020 AMT 2021 Tax-Exempt 2021 Taxable 2021 AMT Last 3 Months Supply - 2020 vs 2021
#13..
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© PFM 9
II. Supply and Demand
PFM Pricing Group
Source: Bloomberg
0 50
100
150
200
250
300
350
400
450
500
0 4 8 12 16 20 24 28 32 36 40 44 48 52
Billions
Weeks
2022 Tax-Exempt 2022 Taxable 2022 AMT 2021 Total
Cumulative YTD Supply - Total
0 50
100
150
200
250
300
350
400
450
0 4 8 12 16 20 24 28 32 36 40 44 48 52
Billions
Weeks
2022 Tax-Exempt 2021 Tax-Exempt2
Cumulative YTD Supply - Tax-Exempt
0 10
20 30
40 50
60 70
80 90
100
110
120
130
0 4 8 12 16 20 24 28 32 36 40 44 48 52
Billions
Weeks
2022 Taxable 2021 Taxable2
Cumulative YTD Supply - Taxable
0 5
10 15
20 25
30 35
40 45
0 4 8 12 16 20 24 28 32 36 40 44 48 52
Billions
Weeks
2022 AMT 2021 AMT2
Cumulative YTD Supply - AMT
#13..
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© PFM 10
Spot Rates
II. Supply and Demand
PFM Pricing Group
Source: Thomson Reuters
Municipal Bond Flows
$1.5
-$3.6
-$44.0
-$4.2
$5.6
$13.2 $12.4 $12.1
$7.6 $7.3 $7.5
$14.3 $15.2
$10.7 $6.3
$11.1
$6.1
$12.2 $11.9 $10.2 $8.6
$1.5
$7.2 $4.7 $2.3
-50
-45
-40
-35
-30
-25
-20
-15
-10
-5
0 5
10 15
20 25
Billions
Monthly Mutual Fund Inflows (Outflows)
$164.7$161.2
$117.1$113.0$118.5$131.7$144.1$156.2$163.8$171.1$178.6$192.9$208.1$218.8$225.1$236.2$242.3$254.5$266.4$276.6$285.2$286.7$293.9$298.6$300.9

0.0 50.0
100.0
150.0
200.0
250.0
300.0
350.0
Billions
Cumulative Monthly Inflows (Outflows)
Monthly Mutual Fund Inflows (Outflows) Current: $2.3 bn Average: $5.5 bn Min: ($44.0) bn Max: $15.2 bn #13..
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© PFM 11
Spot Rates
II. Supply and Demand
PFM Pricing Group
Source: Bloomberg, TM3, ICI
Historical Supply & Demand
50 25201510
Billions
Taxable Tax-Exempt Total
Supply
$15.2
$10.7
$6.3
$11.1
$6.1
$12.2 $11.9
$10.2
$8.6
$1.5
$7.2
$4.7
$2.3

0.0 20.010.0
Billions
Inflows (Outflows)
Demand
40302010

3.00%2.50%2.00%1.50%1.00%0.50%0.00%
Spread in Basis Points
Yield
10-Year AAA MMD 10 Year A To AAA Spread
Rate and Spread Movement
#13..
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© PFM 12
Spot Rates
II. Supply and Demand
PFM Pricing Group
Source: Bloomberg, TM3, ICI
Forward Looking Supply & Demand
50 25201510
Billions
30 Visible Supply
30-Day Visible Supply
$22.6
$6.2
$23.4
$34.4
$4.4 -$1.5
$18.5 $12.5 $15.9
$38.7
$11.8 $18.5 $6.7
-20-40-60
0 604020
Billions
Issued Maturting/Callable Net Issuance
Net Issuance

3.58 3.6

3.683.663.643.62

3.7 3.783.763.743.72

3.8 3.883.863.843.82

3.9 Trillions
Total Municipal Principal Outstanding
Total Municipal Principal Outstanding
#13..
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© PFM 13
III. Tax-Exempt Ratios
PFM Pricing Group
Source: Bloomberg & Thomson Reuters
0%
100%
200%
300%
400%
500%
600%
700%
800%
2 3 5 7 10 15 20 25 30
Ratio
Maturity
12 Month Ratio Range Current Average
TE - Treasury Ratio (Cheap/Rich) Past 12 Months
0%
100%
200%
300%
400%
500%
600%
700%
800%
2 3 5 7 10 15 20 25 30
Ratio
Maturity
5 Year Ratio Range Current Average
TE - Treasury Ratio (Cheap/Rich) Past 5 Years
0 50
100
150
200
250
300
2s/10s MMD 10s/30s MMD
Basis Points
Spreads
12 Month Range Current Average
MMD Spreads Past 12 Mths
0 50
100
150
200
250
300
2s/10s MMD 10s/30s MMD
Basis Points
Spreads
5 Year Range Current Average
MMD Spreads Past 5 Yrs Tax-Exempt to Treasury Ratios
Current Min 5 Year Max 5 Year Min 12 Mth Max 12 Mth
2-Year 58% 25% 800% 25% 165%
3-Year 56% 27% 753% 27% 134%
5-Year 58% 38% 620% 38% 88%
7-Year 66% 42% 406% 42% 76%
10-Year 73% 54% 354% 54% 83%
15-Year 76% 60% 318% 60% 88%
20-Year 81% 64% 297% 64% 90%
25-Year 84% 66% 274% 66% 93%
30-Year 83% 64% 249% 64% 91%
MMD Curve Steepness (in bps)
Current Min 5 Year Max 5 Year Min 12 Mth Max 12 Mth
2s/10s 70 bps 18 bps 143 bps 60 bps 103 bps
10s/30s 44 bps 44 bps 90 bps 44 bps 67 bps
#13..
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© PFM 14
Spot Rates
III. Tax-Exempt Ratios
PFM Pricing Group
Source: Bloomberg & Thomson Reuters
50%
150%
250%
350%
450%
550%
650%
750%
Ratio
2-Year 5-Year 7-Year 10-Year 20-Year 30-Year
Tax-Exempt - Treasury Ratios Past 2 Years
Tax-Exempt - Treasury Ratios Past 2 Years
Current Average Minimum Maximum Current Average Minimum Maximum 2-Year 58% 112% 25% 800% 10-Year 73% 94% 54% 354%
5-Year 58% 86% 38% 620% 20-Year 81% 103% 64% 297%
7-Year 66% 85% 42% 406% 30-Year 83% 94% 64% 249%
#13..
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© PFM 15
Spot Rates
IV. Curves and Spreads
PFM Pricing Group
Taxable Credit Spreads vs 10-Year Treasury
Source: Bloomberg & Thomson Reuters
0 50
100
150
Spreads
Corp AA Corp A Corp BBB Tax-Equiv AA Tax-Equiv A Tax-Equiv BBB Corporate & Taxable-Equivalent Spreads to Treasuries (10-Year Maturity) #13..
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© PFM 16
Spot Rates
IV. Curves and Spreads
PFM Pricing Group
Source: Thomson Reuters
Municipal Credit Spreads vs 10-Year AAA MMD
0 12.5
25 37.5
50 62.5
75 87.5
100
Spreads
GO / Rev AA GO / Rev A GO / Rev BBB
Generic GO & Revenue Spreads to AAA MMD (10 Year Maturity) 0 25
50 Spreads

AA A BBB
AMT-Revenue To Revenue Spreads (10-Year Maturity)
#13..
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© PFM 17
V. Upcoming Week Calendars #13..
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© PFM 18
Spot Rates
V. Upcoming Week Calendars
PFM Pricing Group
Source: Bloomberg
Week of 1/24/2022 Supply Calendar
Par ($000s) Issuer State Ratings (M/S/F) Sale Type Tax Status Lead Manager Week Of * 799,265 MONTGOMERY CO HGR EDU-B PA --/A/-- Negotiated Tax-Exempt BANK OF AMERICA MERRILL 1/24/2022 683,275 KY PUB ENERGY AUTH -A-1 KY --/--/-- Negotiated Tax-Exempt MORGAN STANLEY & CO LLC 1/24/2022 498,920 BLACK BELT ENERGY GAS DT AL Baa1/--/A- Negotiated Tax-Exempt GOLDMAN SACHS & COMPANY 1/24/2022 417,675 NEW HOPE CULTURAL EDU-A TX --/--/-- Negotiated Tax-Exempt BC ZIEGLER & CO 1/24/2022 344,515 IN FIN AUTH -A -REF IN Aa2/--/-- Negotiated Tax-Exempt BANK OF AMERICA MERRILL 1/24/2022 317,165 DALLAS ISD-REF-TXBL-A TX Aaa/AAA/-- Negotiated Taxable WELLS FARGO BANK NA 1/24/2022 308,730 SAN FRANCISCO CITY & CO-A CA --/--/-- Negotiated AMT CITIGROUP GLOBAL MKTS INC 1/24/2022 239,230 SAN FRANCISCO CITY & CO-B CA --/--/-- Negotiated Tax-Exempt CITIGROUP GLOBAL MKTS INC 1/24/2022 208,010 WORCESTER MA --/AA-/-- Competitive Tax-Exempt -- 1/24/2022 201,195 SAN FRANCISCO CITY & CO-C CA --/--/-- Negotiated Taxable CITIGROUP GLOBAL MKTS INC 1/24/2022 175,000 OH HSG FIN AGY-A-REV OH Aaa/--/-- Negotiated Tax-Exempt CITIGROUP GLOBAL MKTS INC 1/24/2022 152,585 FORNEY ISD-A TX --/A+/-- Negotiated Tax-Exempt FHN FIN CAPITAL MARKETS 1/24/2022 150,000 CT ST HLTH & EDU FACS-A-4 CT --/AAA/-- Negotiated Tax-Exempt JP MORGAN SECURITIES LLC 1/24/2022 127,000 YOSEMITE CMNTY CLG DT-REF CA Aa2/--/-- Negotiated Taxable PIPER SANDLER & CO 1/24/2022 125,000 CT ST HLTH & EDU FACS-U-1 CT --/AAA/-- Negotiated Tax-Exempt JP MORGAN SECURITIES LLC 1/24/2022 125,000 CT ST HLTH & EDU FACS-U-2 CT --/AAA/-- Negotiated Tax-Exempt JP MORGAN SECURITIES LLC 1/24/2022 117,390 ALVIN ISD TX Aaa/--/AAA Negotiated Tax-Exempt PIPER SANDLER & CO 1/24/2022 115,500 PALACIOS ISD TX Aaa/--/-- Negotiated Tax-Exempt HILLTOP SECURITIES INC 1/24/2022 115,335 CHARLOTTE-MECKLENBURG-A NC --/AA-/-- Negotiated Tax-Exempt CITIGROUP GLOBAL MKTS INC 1/24/2022 112,375 AZ INDL DEV AUTH -A -TXBL AZ --/--/-- Negotiated Taxable GOLDMAN SACHS & COMPANY 1/24/2022 100,395 AUSTIN ISD-B-REF TX --/--/-- Negotiated Tax-Exempt SAMUEL A RAMIREZ & CO INC 1/24/2022 100,000 SPARTANBURG CO SD#5 SC --/AA/-- Competitive Tax-Exempt -- 1/27/2022 95,000 NAVARRO ISD TX --/AAA/-- Negotiated Tax-Exempt HILLTOP SECURITIES INC 1/24/2022 92,870 AUSTIN ISD-A TX --/--/-- Negotiated Tax-Exempt SAMUEL A RAMIREZ & CO INC 1/24/2022 90,000 WEBER SD BOE UT --/--/-- Competitive Tax-Exempt -- 1/25/2022 85,445 IN HSG & CMNTY DEV AUTH-A IN --/--/-- Negotiated Tax-Exempt JP MORGAN SECURITIES LLC 1/24/2022 85,000 BUSHLAND ISD-REF TX --/AAA/-- Negotiated Tax-Exempt RBC CAPITAL MARKETS LLC 1/24/2022 83,609 AZ INDL DEV AUTH -B-TXBL AZ --/--/-- Negotiated Taxable GOLDMAN SACHS & COMPANY 1/24/2022 79,650 LAWRENCE MA --/AA/-- Competitive Tax-Exempt -- 1/25/2022 79,545 AUSTIN ISD-E-REF-TXBL TX --/--/-- Negotiated Taxable SAMUEL A RAMIREZ & CO INC 1/24/2022 73,990 CSCDA CMNTY IMPT AUTH-A-2 CA --/--/-- Negotiated Tax-Exempt STIFEL NICOLAUS & CO INC 1/24/2022 73,155 SARPY CO SD #37 NE --/--/-- Negotiated Tax-Exempt DA DAVIDSON & CO 1/24/2022 68,385 CMFA SPL FIN AGY-A-2 CA --/--/-- Negotiated Tax-Exempt JEFFERIES LLC 1/24/2022 60,975 WINNEBAGO ETC CO SD #205 IL --/--/-- Negotiated Tax-Exempt STIFEL NICOLAUS & CO INC 1/24/2022 57,725 NE INVESTMENT FIN AUTH-A NE --/AA+/-- Negotiated Tax-Exempt JP MORGAN SECURITIES LLC 1/24/2022 51,900 LAKE ORION CMNTY SCHS MI --/--/-- Negotiated Tax-Exempt STIFEL NICOLAUS & CO INC 1/24/2022 50,270 AUSTIN ISD-D-REF-TXBL TX --/--/-- Negotiated Taxable SAMUEL A RAMIREZ & CO INC 1/24/2022 45,780 CO HSG & FIN AUTH -B -REF CO --/AAA/-- Negotiated Tax-Exempt RBC CAPITAL MARKETS LLC 1/24/2022 44,150 MARICOPA CO UNIF SD #41 AZ --/AA-/-- Negotiated Tax-Exempt STIFEL NICOLAUS & CO INC 1/24/2022 44,000 TYLER-REV TX --/AA+/-- Competitive Tax-Exempt -- 1/25/2022 43,000 UTAH HSG CORP -C -G2 UT --/--/-- Negotiated Tax-Exempt STIFEL NICOLAUS & CO INC 1/24/2022 42,430 COLUMBUS BLDG AUTH-A-REV GA Aa2/AA+/-- Competitive Tax-Exempt -- 1/25/2022 40,030 WINSTON SALEM -REV-REF-B NC --/AA+/-- Negotiated Taxable ROBERT W BAIRD & CO INC 1/24/2022 40,000 VA HSG DEV AUTH-A-TXBL VA Aa1/AA+/-- Competitive Taxable -- 1/25/2022 39,290 WILL CO CUSD #201-U-A IL --/A/-- Negotiated Tax-Exempt HUNTINGTON SECURITIES INC 1/24/2022 37,640 UNIV OF IDAHO REGENTS-A ID --/--/-- Negotiated Tax-Exempt WELLS FARGO BANK NA 1/24/2022 37,115 SAN JACINTO CMNTY CLG DT TX --/AA/-- Negotiated Tax-Exempt WELLS FARGO BANK NA 1/24/2022 35,000 CA EDUCATIONAL FACS-A CA --/--/-- Negotiated Tax-Exempt WELLS FARGO BANK NA 1/24/2022 35,000 MELBOURNE FL --/AA/-- Competitive Tax-Exempt -- 1/25/2022 30,840 NH MUNI BD BK-B NH --/--/-- Negotiated Tax-Exempt ROBERT W BAIRD & CO INC 1/24/2022 #13..
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2 7/21/2021
1735 Market Street
43rd Floor
Philadelphia, PA 19103
Annual Report as of
June 30, 2021
Report generated on:

City of Modesto
Powered by SwapViewer®
The valuations of derivatives transactions provided by PFM are indicative values based on mid-market levels as of the close of business on the date they are provided. These valuations are provided for information purposes only and are intended solely for internal use. These valuations do not represent the actual terms at which new transactions could be entered into or the actual terms at which existing transactions could be liquidated. The valuations provided are derived from proprietary models based upon well-recognized financial principles and reasonable estimates about relevant future market conditions. Valuations based on other models or different assumptions may yield different results. PFM believes its valuation methodology to be consistent with accepted practice in the market for interest rate swaps. Additional information is available on request. Information herein is believed to be reliable, but PFM does not warrant its completeness or accuracy. PFM does not hold a position or act as a market maker in the financial instruments of any issuer discussed herein.

GASB 53 Effectiveness Testing Results & GASB 72 Fair Value Measurements #13..
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City of Modesto
Suggested Summary Entries
Swap Fair Values (GASB Statement No. 72):

Fair ValueChange in Fair Value (current year)
Journal Entries for the Swap Fair Values:

MODESTO200706050001
Derivative instrument - swap liabilities $ 1,047,786.60 Deferred Outflow of resources $ 1,047,786.60
(to record the current year change in fair value)
MODESTO200706050002
Derivative instrument - swap liabilities $ 5,135,716.74 Deferred Outflow of resources $ 5,135,716.74
(to record the current year change in fair value)
MODESTO200805290001
Derivative instrument - swap liabilities $ 2,955,615.89 Deferred Outflow of resources $ 2,955,615.89
(to record the current year change in fair value)
MODESTOPFA200808220001
Derivative instrument - swap liabilities $ 2,608,865.08 Deferred Outflow of resources $ 2,608,865.08
(to record the current year change in fair value)
Following are details of the fair values and effectiveness testing results:
6/30/2021
$ (44,296,280.84)$ 11,747,984.31
These are the suggested sample journal entries for City of Modesto to comply with GASB 53 for period ending June 30, 2021. #13..
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City of Modesto Swap Fair Values (the fair values and changes in fair values of the swaps) Transaction
Name
Accrued
Interest
Valuation
Amount
Accrued
Interest
Valuation
Amount
Apply Hedge
Accounting/
Pass Effectiveness
Testing (6/30/2020)
Apply Hedge
Accounting/
Pass Effectiveness
Testing (6/30/2021)
MODESTO200706050001 $ (320,279.83) $ (4,524,627.44) $ (325,759.91) $ (3,476,840.84) Yes Yes MODESTO200706050002 $ (968,287.98) $ (28,029,640.88) $ (984,772.91) $ (22,893,924.14) Yes Yes MODESTO200805290001 $ (112,811.40) $ (12,418,876.93) $ (113,952.55) $ (9,463,261.04) Yes Yes MODESTOPFA200808220001 $ (131,878.54) $ (11,071,119.90) $ (128,363.70) $ (8,462,254.82) Yes Yes $ (56,044,265.15) $ (44,296,280.84)
Transaction
Name
Valuation
Amount
Not Applied
Valuation
Amount
Applied
Change in
Fair Value
(6/30/2021)
MODESTO200706050001 $ - $ (3,476,840.84) $ 1,047,786.60 $ 1,047,786.60 $ - $ 1,047,786.60 - $ $ - -$ -$ -$ MODESTO200706050002 $ - $ (22,893,924.14) $ 5,135,716.74 $ 5,135,716.74 $ - $ 5,135,716.74 - $ $ - -$ -$ -$ MODESTO200805290001 $ - $ (9,463,261.04) $ 2,955,615.89 $ 2,955,615.89 $ - $ 2,955,615.89 - $ $ - -$ -$ -$ MODESTOPFA200808220001 $ - $ (8,462,254.82) $ 2,608,865.08 $ 2,608,865.08 $ - $ 2,608,865.08 - $ $ - -$ -$ -$ $ - $ (44,296,280.84) 11,747,984.31 $ $ - 11,747,984.31 $ - $ 11,747,984.31 $ - $ - $ - $ - $ 6/30/2020
Fair Value
(GASB Statement No. 72)
Fair Value
(GASB Statement No. 72)
6/30/2021
Derivative Instrument
(Increase)/ Decrease
Dr. Cr.

Deferred (Out)/In flows
Dr. Cr.

Derivative Instrument
(Increase)/ Decrease
Dr. Cr.

Investment (Losses)/
Gains
Dr. Cr.

Apply Hedge Accounting
(6/30/2021)
Hedging
Derivative Instruments
Change in Fair Value (6/30/2021)
Investment
Derivative Instruments
Change in Fair Value (6/30/2021)
#13..
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City of Modesto Swap Valuation Report
Snapshot Accrued Interest Mark-to-market
6/30/2021 $ (1,552,849.07) $ (45,100,981.76)
Transaction
Name Product Client Pays Client Receives Initial Notional Current Notional Effective Date Maturity Date Accrued Interest Valuation Amount Bank Counterparty Moody's S&P Fitch Apply Hedge Accounting MODESTO200706050001 Swap 4.37800% 67% of 3 Month LIBOR + 0.58% $ 23,370,000.00 $ 23,370,000.00 6/26/2007 9/1/2027 $ (325,759.91) $ (3,493,579.56) JPMorgan Chase Bank, N.A. Aa2 A+ AA YesMODESTO200706050002 Swap 4.44000% 67% of 3 Month LIBOR + 0.63% $ 69,820,000.00 $ 69,820,000.00 6/26/2007 9/1/2037 $ (984,772.91) $ (23,425,645.08) JPMorgan Chase Bank, N.A. Aa2 A+ AA Yes MODESTO200805290001 Swap 3.47470% 63.7% of USD- LIBOR + 0.154% $ 47,625,000.00 $ 43,265,000.00 5/30/2008 10/1/2036 $ (113,952.55) $ (9,571,816.44) Bank of America, N.A. Aa2 A+ AA- Yes MODESTOPFA200808220001 Swap 3.61400% 63.7% of USD- LIBOR + 0.154% $ 65,170,000.00 $ 46,745,000.00 8/28/2008 9/1/2033 $ (128,363.70) $ (8,609,940.68) Bank of America, N.A. Aa2 A+ AA- Yes 6/30/2021 Credit Support Credit Value Adjustment Fair Value $ 804,700.92 - $ $ (44,296,280.84)
Transaction
Name
Asset/
Liability
Non-Performance
Risk Entity Moody's S&P Fitch Credit Support Credit Value Adjustment Valuation Amount Valuation Level MODESTO200706050001 Liability MIDFA N/A N/A N/A $ 16,738.72 - $ $ (3,476,840.84) Observable (Level 2) MODESTO200706050002 Liability MIDFA N/A N/A N/A $ 531,720.94 - $ $ (22,893,924.14) Observable (Level 2) MODESTO200805290001 Liability City of Modesto (Water) N/A N/A N/A $ 108,555.40 - $ $ (9,463,261.04) Observable (Level 2) MODESTOPFA200808220001 Liability Modesto Public Financing Authority N/A N/A N/A $ 147,685.86 - $ $ (8,462,254.82) Observable (Level 2) Snapshot Accrued Interest Mark-to-market
6/30/2020 $ (1,533,257.75) $ (59,628,221.62)
Transaction
Name Product Client Pays Client Receives Initial Notional Current Notional Effective Date Maturity Date Accrued Interest Valuation Amount Bank Counterparty Moody's S&P Fitch Apply Hedge Accounting MODESTO200706050001 Swap 4.37800% 67% of 3 Month LIBOR + 0.58% $ 23,370,000.00 $ 23,370,000.00 6/26/2007 9/1/2027 $ (320,279.83) $ (4,657,061.25) JPMorgan Chase Bank, N.A. Aa2 A+ AA YesMODESTO200706050002 Swap 4.44000% 67% of 3 Month LIBOR + 0.63% $ 69,820,000.00 $ 69,820,000.00 6/26/2007 9/1/2037 $ (968,287.98) $ (30,581,797.02) JPMorgan Chase Bank, N.A. Aa2 A+ AA YesMODESTO200805290001 Swap 3.47470% 63.7% of USD- LIBOR + 0.154% $ 47,625,000.00 $ 43,660,000.00 5/30/2008 10/1/2036 $ (112,811.40) $ (12,805,555.93) Bank of America, N.A. Aa2 A+ AA- Yes MODESTOPFA200808220001 Swap 3.61400% 63.7% of USD- LIBOR + 0.154% $ 65,170,000.00 $ 48,915,000.00 8/28/2008 9/1/2033 $ (131,878.54) $ (11,583,807.42) Bank of America, N.A. Aa2 A+ AA- Yes 6/30/2020 Credit Support Credit Value Adjustment Fair Value $ 3,583,956.47 - $ $ (56,044,265.15)
Transaction
Name
Asset/
Liability
Non-Performance
Risk Entity Moody's S&P Fitch Credit Support Credit Value Adjustment Valuation Amount Valuation Level MODESTO200706050001 Liability MIDFA N/A N/A N/A $ 132,433.81 - $ $ (4,524,627.44) Observable (Level 2) MODESTO200706050002 Liability MIDFA N/A N/A N/A $ 2,552,156.14 - $ $ (28,029,640.88) Observable (Level 2) MODESTO200805290001 Liability City of Modesto (Water) N/A N/A N/A $ 386,679.00 - $ $ (12,418,876.93) Observable (Level 2) MODESTOPFA200808220001 Liability Modesto Public Financing Authority N/A N/A N/A $ 512,687.52 - $ $ (11,071,119.90) Observable (Level 2) Non-Performance Risk Entity Ratings
City of Modesto
Client Bank Counterparty Ratings
City of Modesto
Client Bank Counterparty Ratings
Non-Performance Risk Entity Ratings
#13..
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City of Modesto - GASB 53 Effectiveness Testing Results Testing Date: June 30, 2021 Consistent Critical Terms Synthetic Instrument Dollar Offset Transaction
Name
Associated
Bonds CUSIP(s) Effectiveness Testing Method Method Applied Data Type Critical Terms R-Squared Statistic 95% Confidence Interval Regression Coefficient Percentage Ratio Fair Value Change Ratio (Hedging Item to Hedged Item) Financial Instruments Apply Hedge Accounting Appendix Critical terms
are
consistent
1 of 3:

R-squared
is at least 0.8
2 of 3:

F-statistic is
significant using 95%
confidence interval
3 of 3:

Coefficient for the
slope is between
-1.25 and -0.8
Percentage ratio
is between
90% to 111%
Effectiveness
percentage is within
80% to 125%
MODESTO200706050001 Series 2007F, MIDFA 607769EK8 Qualitative Method Consistent Critical Terms Qualitative Yes N/A N/A N/A N/A N/A Hedging Derivative Yes A.01 MODESTO200706050002 Series 2007F, MIDFA 607769EL6 Qualitative Method Consistent Critical Terms Qualitative Yes N/A N/A N/A N/A N/A Hedging Derivative Yes A.02MODESTO200805290001 Series 2008A, Water Ref. COP's 607804AC5 Quantitative Method Regression Analysis Rate N/A 0.95 Yes -0.99 N/A N/A Hedging Derivative Yes A.03MODESTOPFA200808220001 Series 2008, PFA Ref. COP's 607796BU2 Quantitative Method Regression Analysis Rate N/A 0.96 Yes -0.99 N/A N/A Hedging Derivative Yes A.04 Effectiveness Testing Criteria for Effective Hedge
The valuations of derivatives transactions provided by PFM are indicative values based on mid-market levels as of the close of business on the date they are provided. These valuations are provided for information purposes only and are intended solely for internal use. These valuations do not represent the actual terms at which new transactions could be entered into or the actual terms at which existing transactions could be liquidated. The valuations provided are derived from proprietary models based upon well-recognized financial principles and reasonable estimates about relevant future market conditions. Valuations based on other models or different assumptions may yield different results. PFM believes its valuation methodology to be consistent with accepted practice in the market for interest rate swaps. Additional information is available on request. Information herein is believed to be reliable, but PFM does not warrant its completeness or accuracy. PFM does not hold a position or act as a market maker in the financial instruments of any issuer discussed herein.

Accrued Interest - interest earned or accrued from the last interest payment date, to the current valuation date. E.g. if a scheduled upcoming payment at the end of a 6 month period is $60,000, and the valuation date is 1 month into the period, the accrued interest would be $10,000. The calculation is performed on the pay leg and receive leg of a swap, is netted, and it takes into account the day count convention of each leg.

Valuation - an indicative measure of the value of a transaction that considers all future payments absent transaction costs, calculated at mid-market rates. It can also be considered the Mark-to-Market (MTM) of a transaction based on observed mid-market rates, methodology and models in practice. The valuation/at-themarket (ATM) valuation would normally include Accrued Interest unless indicated otherwise. It also considers any embedded component transactions such as options. For entities reporting under GASB 72 Fair Value Measurements, the Fair Value by its definition includes nonperformance risk, while the MTM does not.

Regression Analysis - a method of fitting a line to get a "best-fit line" through a set of two variables, in this case the hedged item and hedging item, to measure how one is affected by the other using the "least squares" method. It analyzes how a single dependent variable (“y”, for example, "hedged item", or "SIFMA", or "Actual Bond Rate", etc.) is affected by the values of one or more independent variables ("x", for example, "hedging item", or "Percentage of LIBOR", or "SIFMA", etc.)Confidence Interval – always associated with a particular confidence level, in this case, 95%, to provide confidence limits of the interval. The confidence interval indicates the reliability of a statistic by giving an estimated range of values which is likely to include the "true" statistic. The higher the confidence level, the wider the confidence interval will be.

F-statistic - the F-statistic or F-ratio is a comparison of two variances of two different population samples. A value of F close to 1 provides evidence that the underlying population variances are equal.

F-statistic is significant using a 95% confidence interval - the F-statistic computed for the model implies a likelihood, in this case at a 95% confidence level, that a result or relationship between the variables tested is caused by something other than mere random chance. The test provides evidence the hedged item and hedging item variances are correlated, and not by mere chance. To be an effective hedge, the F-statistic should demonstrate the model is significant using a 95% confidence interval.R-squared - a measure of the proportion of the variance in a dependent variable, in this case the hedged item, about its mean that can be explained by changes in the independent variable, the hedging item. An R-squared statistic of 1 indicates the regression line perfectly fits the data. To be an effective hedge, the R-squared statistic must be at least 0.80.Regression Coefficient - when the regression line is linear (y = ax + b), the regression coefficient is the constant (“a”) that represents the rate of change of one variable (“y” or “hedged item”) as a function of changes in the other (“x” or “hedging item”); it is the slope of the regression line. A regression coefficient of -1 indicates a “1 to 1” relationship between the hedged item and hedging item, where a 1 dollar increase in one is offset by a 1 dollar decrease in the other. To be an effective hedge, the coefficient must be between -1.25 and -0.80. Slope – the steepness, incline, or grade for the line fitted through a set of two variables, or for the "best-fit line". #13..
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MODESTO200706050001 A.01
(Series 2007F, MIDFA)Swap Fair Value
As of and for the Fiscal Year Ended
June 30, 2021
Fair value $ (3,476,840.84)
Change in fair value $ 1,047,786.60
Interest Rate Swap Variable Rate Bond
Swap Notional $ 23,370,000.00 Bond Principal $ 23,370,000.00 Termination 9/1/2027 Maturity of Bonds 9/1/2027
Variable Payment 67% of 3 Month LIBOR + 0.58% Benchmark Interest Rate 67% of 3 Month LIBOR + 0.58% Floor or Cap Yes Floor or Cap YesOption No Option No
Time interval of reference rate Every 3 Months Time interval of reference rate Every 3 MonthsFrequency of rate reset Quarterly Frequency of rate reset QuarterlyRate reset dates 1st day of each March, June, September and December Rate reset dates 1st day of each March, June, September and December Swap payment date 1st day of each March, June, September and December Coupon payment date 1st day of each March, June, September and DecemberUpon association with the variable-rate bond, the pay-fixed, receive variable swap has a zero fair value. The fixed rate (4.37800%) and the formula to determine the variable rate of the swap (3-Month LIBOR) remain the same throughout the life of the swap. #13..
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MODESTO200706050001 A.02
(Series 2007F, MIDFA)Swap Fair Value
As of and for the Fiscal Year Ended
June 30, 2021
Fair value $ (22,893,924.14)
Change in fair value $ 5,135,716.74
Interest Rate Swap Variable Rate Bond
Swap Notional $ 69,820,000.00 Bond Principal $ 69,820,000.00 Termination 9/1/2037 Maturity of Bonds 9/1/2037
Variable Payment 67% of 3 Month LIBOR + 0.63% Benchmark Interest Rate 67% of 3 Month LIBOR + 0.63% Floor or Cap Yes Floor or Cap YesOption No Option No
Time interval of reference rate Every 3 Months Time interval of reference rate Every 3 MonthsFrequency of rate reset Quarterly Frequency of rate reset QuarterlyRate reset dates 1st day of each March, June, September and December Rate reset dates 1st day of each March, June, September and December Swap payment date 1st day of each March, June, September and December Coupon payment date 1st day of each March, June, September and DecemberUpon association with the variable-rate bond, the pay-fixed, receive variable swap has a zero fair value. The fixed rate (4.44000%) and the formula to determine the variable rate of the swap (3-Month LIBOR) remain the same throughout the life of the swap. #13..
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MODESTO200805290001 A.03
(Series 2008A, Water Ref. COP's)

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.976810872
R Square 0.954159479Adjusted R Square 0.954022232Standard Error 0.003113382Observations 336 ANOVA
df SS MS F Significance F
Regression 1 0.067388038 0.067388038 6952.130085 1.1982E-225Residual 334 0.003237512 9.69315E-06Total 335 0.07062555 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0% Intercept 0.000812852 0.000275955 2.945591167 0.003449649 0.000270022 0.001355682 0.000270022 0.001355682Hedging Rate -0.994535727 0.01192783 -83.37943443 1.1982E-225 -1.017998866 -0.971072588 -1.017998866 -0.971072588 y = -0.9945x + 0.0008
R² = 0.9542
-6.00%-5.00%-4.00%-3.00%-2.00%-1.00%

0.00%

0.00% 1.00% 2.00% 3.00% 4.00% 5.00%
Hedged Item - Modesto Variable
Rates/Benchmark
Hedging Item - 63.7% of USD-LIBOR + 0.154%

63.7% of USD-LIBOR + 0.154% vs. Modesto Variable Rates/Benchmark 7/1/1993 to 6/30/2021
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MODESTOPFA200808220001 A.04
(Series 2008, PFA Ref. COP's)

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.979152982
R Square 0.958740562Adjusted R Square 0.958602107Standard Error 0.002876888Observations 300 ANOVA
df SS MS F Significance F
Regression 1 0.057311253 0.057311253 6924.589821 2.4352E-208Residual 298 0.002466392 8.27648E-06Total 299 0.059777645 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0% Intercept 0.000539856 0.000257191 2.099044211 0.036654156 3.37146E-05 0.001045998 3.37146E-05 0.001045998Hedging Rate -0.99450992 0.011951216 -83.21412032 2.4352E-208 -1.018029393 -0.970990447 -1.018029393 -0.970990447 y = -0.9945x + 0.0005
R² = 0.9587
-6.00%-5.00%-4.00%-3.00%-2.00%-1.00%

0.00%

0.00% 1.00% 2.00% 3.00% 4.00% 5.00%
Hedged Item - Modesto Variable
Rates/Benchmark
Hedging Item - 63.7% of USD-LIBOR + 0.154%

63.7% of USD-LIBOR + 0.154% vs. Modesto Variable Rates/Benchmark 7/1/1996 to 6/30/2021
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City of Modesto
Relevant Data for Fair Value Calculation, incorporating nonperformance risk as of 06/30/2021

LIBOR YIELD CURVE SIFMA YIELD CURVE SIFMA/LIBOR RATIOS
1M 0.1005 1Y 0.1314 1Y 53.3750
2M 0.1255 2Y 0.1871 2Y 57.3750
3M 0.1458 3Y 0.3452 3Y 61.2500
4M 0.1503 4Y 0.5032 4Y 64.6250
5M 0.1549 5Y 0.6391 5Y 67.6250
6M 0.1595 7Y 0.8485 7Y 71.0000
7M 0.1740 10Y 1.0544 10Y 74.3750
8M 0.1884 12Y 1.1569 12Y 76.1250
9M 0.2029 15Y 1.2689 15Y 78.2500
10M 0.2173 20Y 1.3824 20Y 80.6250
11M 0.2318 30Y 1.4795 30Y 84.3750
1Y 0.24632Y 0.32623Y 0.56404Y 0.77955Y 0.94626Y 1.08507Y 1.19698Y 1.28579Y 1.3582 10Y 1.420211Y 1.475812Y 1.522713Y 1.562014Y 1.594515Y 1.624920Y 1.7183 30Y 1.757340Y 1.693050Y 1.6050
Maturity Maturity Maturity
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Muni Water Sewer
Utility AA
Muni General Purpose
A
Muni General Purpose AA
BS1306 BVSC1208 BVSC1287
Tax-Exempt Tax-Exempt Tax-Exempt
Observable - Level 2 Observable - Level 2 Observable - Level 2 3M 0.1201 3M 0.1663 3M 0.3355
6M 0.1300 6M 0.1762 6M 0.3453
1Y 0.1716 1Y 0.2209 1Y 0.38542Y 0.2068 2Y 0.2604 2Y 0.41283Y 0.3003 3Y 0.3589 3Y 0.49514Y 0.4618 4Y 0.5246 4Y 0.64345Y 0.6040 5Y 0.6697 5Y 0.77177Y 0.8310 7Y 0.9057 7Y 0.97639Y 1.0968 9Y 1.1884 9Y 1.2353 10Y 1.1581 10Y 1.2616 10Y 1.3007
12Y 1.2540 12Y 1.3851 12Y 1.416714Y 1.3331 14Y 1.4885 14Y 1.520615Y 1.3746 15Y 1.5385 15Y 1.573220Y 1.5208 20Y 1.6671 20Y 1.728530Y 1.7828 30Y 1.8245 30Y 1.8836 US Financials A
BS38
Taxable
Observable - Level 2
3M 0.22756M 0.2462
1Y 0.30202Y 0.43203Y 0.66904Y 0.96905Y 1.24607Y 1.72409Y 2.0550 10Y 2.189012Y 2.383014Y 2.577015Y 2.674020Y 2.897030Y 3.0130 MaturityMaturity Maturity Maturity
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1 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01
FOR

MUNICIPAL ADVISORY SERVICES AND

ANNUAL DERIVATIVE VALUATION REPORT
PROPOSAL OPENING: FEBRUARY 1, 2022 at 11:00 A.M.

CITY OF MODESTO CONTACT: Dianne Love, Senior Buyer
E-MAIL ADDRESS: [email protected]
PHONE: (209)571-5164
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2 CITY OF MODESTO

MUNICIPAL ADVISORY SERVICES AND

ANNUAL DERIVATIVE VALUATION REPORT
REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

TABLE OF CONTENTS
Page
. Notice to Proposers .................................................................................................................................3 . City Contacts ...........................................................................................................................................4 . Calendar of Events ..................................................................................................................................4 . Offer and Acceptance..............................................................................................................................4 FORMS
. Proposal Acknowledgement (Signature Form)....................................................................................6 . Pricing Schedule (Signature Form)......................................................................................................7 . Exceptions, Clarifications, Amendments ...............................................................................................8 . References ...............................................................................................................................................9 . Financial Interest Disclosure.................................................................................................................11 . Company History Statement.................................................................................................................14 . Minimum Qualifications.......................................................................................................................14 . Addenda Acknowledgment...................................................................................................................15 Technical Specifications and Requirements
. Proposal Evaluation Criteria .................................................................................................................16 . Background............................................................................................................................................17 . Scope of Services ..................................................................................................................................17 . Insurance Requirements........................................................................................................................20 General Terms and Conditions
. Proposal Submittal ................................................................................................................................22 . Acceptance/Rejection of Irregular Proposals .......................................................................................23 . Complete Proposal Document ..............................................................................................................23 . Compliance/Non-Compliance ..............................................................................................................23 . Pricing Format.......................................................................................................................................23 . Pricing Schedule....................................................................................................................................24 . Award of Proposal.................................................................................................................................24 . Evaluation Process ................................................................................................................................24 . Term of Contract ...................................................................................................................................24 . Termination of Services ........................................................................................................................25 . Payment .................................................................................................................................................25 . Sample Agreement................................................................................................................................34 #13..
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3 NOTICE TO PROPOSERS
NOTICE IS HEREBY GIVEN that the City of Modesto, County of Stanislaus, State of California, will receive at the City Clerk’s office, 1010 Tenth Street, Suite 6600, Modesto, CA 95354 sealed proposals for the furnishing of MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT for the City of Modesto, Finance Department.

All equipment, materials, and supplies shall be furnished F.O.B. City of Modesto. Proposals shall be submitted on the proposal sheet and shall be downloaded from the City’s Purchasing website at http://www.modestogov.com/257/Contracting-Bid-Opportunities; such proposals shall include all necessary specifications. It is highly recommended all proposal documents be downloaded from the City’s website.

Each proposal shall be sealed and filed with the City Clerk’s office, 1010 Tenth Street, Suite 6600, Modesto, CA 95354 no later than Tuesday, February 1, 2022 at 11:00 A.M., at which time proposals will be opened and recorded. All proposals shall be available for review following City Council award approval at the Purchasing Division, 1010 Tenth Street, 5th Floor, Suite 5300, Modesto, CA 95354.

Proposals will be received only at the address shown above, and prior to the time indicated. Any proposal received at or after said time and/or date, or at a place other than the stated address cannot be considered and will be returned to the proposer unopened.

All proposals, whether delivered by an employee of the proposer, U.S. Postal Service, courier or package delivery service must be received and time stamped at the stated address prior to the time designated. The City Clerk’s time stamp shall be considered the official timepiece for the purpose of establishing the actual receipt of proposals. The City of Modesto assumes no responsibility for delay in the delivery of the proposal.

On the outside of both the proposal envelope and courier envelope, the proposer shall indicate the following:

NAME AND ADDRESS OF PROPOSER
SPECIFICATION NUMBER 2122-01

MUNICIPAL ADVISORY SERVICES AND

ANNUAL DERIVATIVE VALUATION REPORT
PROPOSAL OPENING DATE: FEBRUARY 1, 2022 AT 11:00 A.M.

MAIL TO: CITY CLERK COURIER TO: CITY CLERK

CITY OF MODESTO CITY OF MODESTO
P.O. BOX 642 1010 10TH STREET, SUITE 6600
MODESTO, CA 95353 MODESTO, CA 95354
The City reserves the right to reject any or all proposals or to waive any informalities or minor irregularities in a proposal.

No proposer may withdraw his/her proposal for a period of one-hundred twenty (120) days after the date set for the opening thereof.
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4 CITY CONTACTS
All questions regarding these specifications, terms, and conditions shall be submitted in writing to Dianne Love, Senior Buyer, via email at [email protected].

All contacts during the proposal process shall be through the Purchasing Division. Attempts by the proposer to contact department representatives may result in disqualification of the proposer from the proposal process.

CALENDAR OF EVENTS
Event Date
Proposal Issued December 8, 2021
Written Questions Due January 6, 2022
Addendum Issued (if required) January 14, 2022
Response Due BEFORE 11:00 A.M. on Tuesday, February 1, 2022 Proposal Award Date May 2022
Note: Award date is approximate.

Note: Deliver or mail proposals to the referenced address, only, as indicated in the Notice to proposers.

It is the responsibility of each proposer to be familiar with all of the specifications, terms and conditions and the site condition (if applicable). The proposer agrees and acknowledges all RFP specifications, terms, and conditions and indicates the ability to perform by submission of a proposal. By the submission of a proposal, the proposer certifies that if awarded a contract they will make no claim against the City based upon ignorance of conditions or misunderstanding of the specifications.

OFFER AND ACCEPTANCE:

Seller represents his/her acceptance to provide products and/or services as follows: City's offer to purchase products and/or services is expressly conditioned upon Seller's assent to the terms and conditions set forth in City purchase order documents, specifications, supporting data, and these articles.

Seller agrees that Seller's Order Acknowledgement terms and conditions received prior to, during, or after order placement by City are hereby rejected. City purchase orders signed by the City's Purchasing Manager or her designated agent and issued to Seller constitutes written notification to Seller of City's rejection of any and all of Seller Order Acknowledgements, counter offers and change to the City's terms and conditions.
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5 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

PROPOSAL SUBMITTAL CHECKLIST
The bidder shall provide a complete bid in a sealed envelope before 11:00 A.M. on the bid opening date.

Failure to provide all the required documents may cause the bid to be considered non-responsive.

COMPLETE BID Page No.
. Proposal Acknowledgement (Signature)...............................................................6 . Pricing Schedule (Signature)..................................................................................7 . Exceptions, Clarifications, Amendments (if applicable)........................................8 . References................................................................................................................9 . Financial Interest Disclosure Form (If applicable)..............................................11 . Company History Statement .................................................................................14 . Minimum Qualifications .......................................................................................14 . Addenda Acknowledgement Page (if applicable) ...............................................15 #13..
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6 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

PROPOSAL ACKNOWLEDGEMENT
The City is soliciting proposals from qualified proposers to furnish its requirements per the specifications, terms and conditions contained in the above referenced proposal number. This Proposal Acknowledgement must be completed, signed by a responsible officer or employee, dated and submitted with the proposal response.

Obligations assumed by such signature must be fulfilled.

1. Preparation of Proposals: (a) All prices and notations must be printed in ink or typewritten. No erasures permitted. Errors may be crossed out and corrections printed in ink or typewritten adjacent and must be initialed in ink by person signing the proposal. (b) Quote price as specified in proposal. No alterations or changes of any kind shall be permitted to the Proposal Form. Responses that do not comply shall be subject to rejection in total.

2. Failure to Submit Proposal: If you are not submitting a proposal but want to remain on the mailing list and receive future proposals, complete, sign and return this Proposal Acknowledgement and state the reason you are not pricing.

3. Taxes and Freight Charges: (a) Unless otherwise required and specified in the RFP, the prices quoted herein do not include Sales, Use or other taxes. (b) No charge for delivery, drayage, express, parcel post packing, cartage, insurance, license fees, permits, costs of bonds, or for any other purpose, except taxes legally payable by City, will be paid by the City unless expressly included and itemized in the proposal. (c) Amount paid for transportation of property to the City is exempt from Federal Transportation Tax. An exemption certificate is not required where the shipping paper shows the consignee as one (1) of the Agencies; as such papers may be accepted by the carrier as proof of the exempt character of the shipment. (d) Articles sold to the Agencies are exempt from certain Federal excise taxes. The Agencies will furnish an exemption certificate.

4. Award: (a) Unless otherwise specified by the proposer or the RFP gives notice of an all-or-none award, the City may accept any item or group of items of any proposal. (b) Proposals are subject to acceptance at any time within thirty (30) days of opening, unless otherwise specified in the RFP. (c) A valid, written purchase order mailed, or otherwise furnished, to the successful proposer within the time for acceptance specified results in a binding contract without further action by either party. The contract shall be interpreted, construed and given effect in all respects according to the laws of the State of California.

5. Patent Indemnity: Proposers who do business with the City shall hold the City, its officers, agents and employees, harmless from liability of any nature or kind, including cost and expenses, for infringement or use of any patent, copyright or other proprietary right, secret process, patented or un-patented invention, article or appliance furnished or used in connection with the contract or purchase order.

6. Samples: Samples of items, when required, shall be furnished free of expense to the City and if not destroyed by test may upon request (made when the sample is furnished), be returned at the proposer’s expense.

7. Rights and Remedies of Agencies for Default: (a) In the event any item furnished by the proposer in the performance of the contract or purchase order should fail to conform to the specifications therefore or to the sample submitted by the proposer with its proposal, the City may reject the same, and it shall thereupon become the duty of the proposer to reclaim and remove the same forthwith, without expense to the City, and immediately to replace all such rejected items with others conforming to such specifications or samples; provided that should the proposer fail, neglect or refuse so to do the City shall thereupon have the right to purchase in the open market, in lieu thereof, a corresponding quantity of any such items and to deduct from any moneys due or that may there after come due to vendor the difference between the prices named in the contract or purchase order and the actual cost thereof to the City. In the event that the proposer fails to make prompt delivery as specified for any item, the same conditions as to the rights of the City to purchase in the open market and to reimbursement set forth above shall apply, except when delivery is delayed by fire, strike, freight embargo, or Act of God or the government. (b) Cost of inspection or deliveries or offers for delivery, which do not meet specifications, will be borne by the proposer. (c) The rights and remedies of the Agencies provided above shall not be exclusive and are in addition to any other rights and remedies provided by law or under the contract.

8. Discounts: (a) Terms of less than ten (10) days for cash discount will be considered as net. (b) In connection with any discount offered, time will be computed from date of complete, satisfactory delivery of the supplies, equipment or services specified in the RFP, or from date correct invoices are received by the City at the billing address specified, if the latter date is later than the date of delivery. Payment is deemed to be made, for the purpose of earning the discount, on the date of mailing the City’s check.

9. California Government Code Section 4552: In submitting a proposal to a public purchasing body, the proposer offers and agrees that if the proposal is accepted, it will assign to the purchasing body all rights, title, and interest in and to all causes of action it may have under Section 4 of the Clayton Act (15 U.S.C. Sec. 15) or under the Cartwright Act (Chapter 2, commencing with Section 16700, of Part 2 of Division 7 of the Business and Professions Code), arising from purchases of goods, materials, or services by the proposer for sale to the purchasing body pursuant to the proposal. Such assignment shall be made and become effective at the time the purchasing body tenders final payment to the proposer.

10. No Guarantee or Warranty: The City makes no guarantee or warranty as to the condition, completeness or safety of any material or equipment that may be traded in on this order.

11. Two “Inked” Signed Original Proposal Document Requested: Failure to furnish at least one “inked” signed original proposal document may result in disqualification.

THE undersigned acknowledges receipt of the referenced RFP and/or Addenda and offers and agrees to furnish the articles and/or services specified on behalf of the proposer indicated below, in accordance with the specifications, terms and conditions of this RFP and Proposal Acknowledgement, for the pricing indicated on the Pricing Schedule.

Firm:

Address:

City/State/Zip:

Signature/Title/Date:
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7 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

PRICING SCHEDULE
Unit Price
Preparation of Annual Derivative Valuation Report (Annual Rate) Municipal Advisory Services (Hourly Rate)
Additional Services (Please specify)
Will proposer accept the City’s Epay Payment Program? Please check one: Yes ____ No ____ Information regarding the program is provided in Section 2.15 Payment.

City Business License No. __________ Expiration Date: __________ THE undersigned acknowledges receipt of the referenced RFP and/or Addenda and offers and agrees to furnish the articles and/or services specified on behalf of the proposer indicated below, in accordance with the specifications, terms and conditions of this RFP and Proposal Acknowledgement, for the pricing indicated on the Pricing Schedule.

Company Name (Proposer):

By (Person Submitting Proposal): (Print)
By (Person Submitting Proposal): (Signature)
Title of Person Submitting Proposal:

Business Address
(City/State/Zip):

Email Address:

Telephone Number:

Fax Number:

Date:
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8 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

EXCEPTIONS, CLARIFICATIONS, AMENDMENTS
Exceptions, Clarifications, Amendments
List requests for proposal clarifications and exceptions below, if any, sign and submit with your proposal response.

Item No. Reference To: Description
Page No. Paragraph No.

Company Name (Proposer):
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9 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

Company Name:

Address:

City, State, Zip Code:

Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
Company Name:

Address:

City, State, Zip Code:

Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
Company Name:

Address:

City, State, Zip Code
Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
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10 Company Name:

Address:

City, State, Zip Code
Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
Company Name:

Address:

City, State, Zip Code
Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
Company Name (Proposer):
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11 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

FINANCIAL INTEREST DISCLOSURE

REQUIRED DISCLOSURE BEGINNING THE COUNCIL MEETING
OF JANUARY 7, 2003
The ordinance requiring financial interest disclosure by all parties having a direct or indirect interest of $2,000 or more (except for certain publicly traded companies) will be effective at the Council meeting of January 7, 2003. This means that any Council action on a contract, agreement or development right must be accompanied by a FINANCIAL INTEREST DISCLOSURE FORM listing by name all parties that have a material financial interest in the agreement, contract or development right.

PLEASE NOTE, any Council action that requires a FINANCIAL INTEREST DISCLOSURE cannot be considered by the City Council until the required reporting is made. That means that Agenda Items without the DISCLOSURE will be removed from the Council Agenda.

FinDisclosure12-19
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12 FINANCIAL INTEREST DISCLOSURE
All persons included within the meaning of either of the following tests have a material financial interest in an agreement, or application for development rights, submitted for approval or disapproval by the City Council, and shall be identified by the applicant, by name.

Tests of Materiality:

1. Whether it is foreseeable to a reasonable person that the value of their interest in property available for use by an applicant, or their interest in the applicant itself, may increase or decrease by an amount greater than $2,000.00 as a direct or indirect result of Council action on the applicant’s agreement or application for development rights.

2. Whether it is foreseeable to a reasonable person that the person’s gross income from the applicant may increase or decrease by a sum greater than $2,000.00 as a direct or indirect result of Council action on the agreement or application for development rights.

It is the legal obligation of all applicants for approval of an agreement or of an application for development rights to verify in writing, under penalty of perjury, that the identity of each person having a material financial interest in the agreement or application or development rights is true, correct and complete.

The applicant understands that this information is provided under penalty of perjury, and that intentionally supplying misinformation or deception may result in either invalidation of the agreement or application, or criminal prosecution for misdemeanor violation of the Modesto Municipal Code, or both. Negligent provision of misinformation shall be grounds for invalidation. In accordance with the Modesto Municipal Code, each applicant has a continuing obligation to maintain the truth, accuracy and completeness of the financial interest disclosure information provided below until after final consideration by the City Council of any matter arising out of or relating to the agreement or application.

By signing this document I agree to the information contained within.

COMPANY NAME: ____________________________________________________ __________________________________
APPLICANT’S NAME (SIGNATURE):
__________________________________
APPLICANT’S NAME/TITLE (PRINT):
__________________________________
Applicable Names: DATE:
(See attached list)
Questions concerning the application of either test to particular facts should be resolved in advance of Council action by agreement with the department head recommending approval of its agreement/application.

DIRECTOR
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13 FINANCIAL INTEREST DISCLOSURE
COMPANY NAME: __________________________________________ NAMES
Signature / Print:

Signature / Print:

Signature / Print:
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14 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

COMPANY HISTORY STATEMENT
Your company shall have been in business for a minimum of three (3) continuous years (immediately prior to the time of the RFP submittal date) providing the types of services requested in this RFP.

The company history statement shall be prepared on company letterhead and provided with the proposal submittal.

MINIMUM QUALIFICATIONS
Minimum Qualifications are mandatory for proposal consideration, and at a minimum shall include the following:

Financial Stability (Provided in a sealed separate envelope):

Proposers shall submit a copy of their company’s most recent professionally prepared Financial Statements (Income Statement and Balance Sheet). These statements, if unaudited, shall be accompanied by a cover letter that states the name and title of the preparer, the basis of the financial statement presentation (cash or accrual) and whether these statements have been prepared in accordance with Generally Accepted Accounting Principles for the most recent fiscal year end of the proposer. Audited financial statements shall be submitted in their entirety, including the auditor’s opinion and notes to the financial statements.

A separate document shall be provided and signed under penalty of perjury by the proposer’s financial officer or owner that explains the proposer’s inability to provide statements for a fiscal period that ended at least eight (8) months before the required date of submittal, if such inability exists.

One complete set of Financial Statements shall be submitted in a sealed separate envelope filed with the (original proposal document), marked with the following:

FINANCIAL STATEMENTS

NAME AND ADDRESS OF PROPOSER
SPECIFICATION NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND

ANNUAL DERIVATIVE VALUATION REPORT
PROPOSAL OPENING DATE: FEBRUARY 1, 2022 AT 11:00 A.M.
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15 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

ADDENDA ACKNOWLEDGEMENT
The bidder shall check the RFB listing on the City or PlanetBid website, periodically, and in any event, no later than the day prior to bid opening to obtain any addenda information. The changes identified in the addenda modify this request for bid and specifications. The addenda now become a part of this request for bid and specifications. Signing the Bid on the signature portion thereof, the bidder is acknowledging that the bidder has confirmed that he or she has received all addenda issued for this request for bid and specifications, and has included costs for such in the bid submitted. Failure to list and acknowledge all addenda numbers may cause the bid to be considered nonresponsive. Do not attach any of the addenda to this sheet nor include them with the bid.

This document is only required to be returned should addenda have been issued.

The Bid is submitted with respect to the changes to the request for bid and specifications included in addenda numbers:

LIST ALL ADDENDA
NUMBERS:_____________________________________________________ Company Name (Bidder):
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16 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT Most of the material needed to present a comprehensive proposal can be placed into one of the sections listed. Responses should be complete and detailed. However, if relevant information needs to be presented to further support the proposer’s case other appropriate sections may be added.

EVALUATION
All responsive proposals submitted will be reviewed by a City of Modesto evaluation committee.

At the completion of the proposal review, finalists may be asked to provide an in-depth presentation and product demonstration in Modesto. Whether or not a presentation shall be performed is wholly within the discretion of the evaluation committee. The committee will select the proposal which best fulfills the City’s requirements and represents the best value to the City of Modesto as determined by the evaluation committee. No single factor will determine the final award decision.

Overall responsiveness to the Request for Proposals is an important factor in the evaluation process.

EVALUATION CRITERIA

1. REFERENCES (Minimum of 5)

2. TECHNICAL SPECIFICATIONS

3. QUALIFICATIONS

4. DELIVERABLES/REPORTS

5. STAFFING

6. EXPERIENCE

7. COST
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17 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

TECHNICAL SPECIFICATIONS AND GENERAL REQUIREMENTS

1.0 BACKGROUND
The City may issue bonds or refund bonds based on the financing needs of the City which will benefit the City’s debt financing portfolio strategy. The City utilizes a municipal advisory services company to assist in monitoring the City’s debt portfolio in a fiduciary capacity. The City of Modesto is seeking proposals from qualified firms to provide services related to financial planning and policy development as well as services related to debt transactions.

1.1 SCOPE OF SERVICES
The selected consultant will assist the City in identifying the best financing strategies to optimize the lowest financing cost based on the guidelines defined under the City’s Debt Management Policy and Federal/State statutes. In addition, the selected consultant will provide annual derivative valuation reports to meet the financial statement requirements under Government Accounting Standards Board (GASB) 53 and 72.

1.2 TECHNICAL SPECIFICATIONS

1.2.1 Provide services related to the financial planning and policy development upon request of the City and as directed by the City Manager or his designee to include, but not limited to, the following.
• Provide advice and counsel regarding developments in the general financial markets, the municipal financial markets in particular
• Assist the City in the formulation of financial and debt policies and administrative procedures.
• Review existing debt portfolio for the possibility of refunding that debt to provide the City with savings.
• Analyze future debt capacity to determine the City's ability to raise future debt capital.
• Assist the City with ongoing administration of its outstanding debt portfolio, including renewal of credit support and regular Mark-to-Market reports for its variable rate bonds.
• Attend meetings with City staff, consultants and other professionals. • Assist City staff in preparing financial presentations for City Council and other public meetings.
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18 1.2.2 Services related to debt transactions; provided that if the transaction is competitive, the services of the municipal advisor will be modified in advance in writing to reflect that process. Upon the request of the City the consultant will perform the following services. • Analyze financial and economic factors to determine if the issuance of bonds is appropriate.
• Advise as to the various financing alternatives available to the City. • Develop a financing plan in concert with City staff which would include recommendations as to the timing and number of series of bonds to be issued. • Assist City staff by recommending the best method of sale; either as a negotiated sale, private placement or a public sale. In a public sale, make recommendation as to the determination of the best bid. In the event of a negotiated sale, assist in the solicitation, review and evaluation of any investment banking proposals, and provide advice and information necessary to aid in such selection. • Develop alternatives related to debt transaction including evaluation of revenues available, maturity schedule and cash flow requirements. • Review the terms, conditions and structure of any proposed debt offering undertaken by the City and provide suggestions, modifications and enhancements where appropriate and necessary to reflect the constraints or current financial policy and fiscal capability.
• Evaluate benefits of bond insurance and/or security insurance for debt reserve fund. • Develop credit rating presentations, coordinate with City Staff the overall presentation and prepare responses to the rating agencies during the rating review process.
• Assist City staff in the procurement of other services relating to debt issuance such as printing, paying agent, registrar, etc.
• Identify key bond covenant features and advise as to the financial consequences of provisions to be included in bond indentures, resolutions or other governing documents regarding security, creation of reserve funds, flow of funds, redemption provisions, additional parity debt tests, etc.; review and comment on successive drafts of bond governing documents.
• Review the requirements and submit analysis to bond insurers, rating agencies and other professionals as they pertain to the City’s obligation. • Coordinate with City staff and other advisors regarding the furnishing of data for offering documents, it being specifically understood that the municipal advisor is not responsible for the inclusion or omission of any material in published offering documents.
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19 • As applicable, advise the City on the condition of the bond market at the time of sale, including volume, timing considerations, competing offerings, and general economic considerations.
• Assist and advise City Staff in negotiations with investment banking groups regarding fees, pricing of the bonds and final terms of any security offering, and make recommendations regarding a proposed offering to obtain the most favorable financial terms based on existing market conditions.
• Communicate any considerations that may impact the City’s credit rating and work with the Director of Finance in examining the City’s financials related to the bond sale(s) or market impacts.
• Perform special projects, including, but not limited to, assisting with capital improvement programs and debt affordability analysis.
• Coordinate and participate in all aspects of the bond issuance process, from creating and maintaining a schedule, conducting independent analysis of financing alternatives, reviewing bond documents, reviewing all aspects of negotiated pricings, monitoring performance of underwriting teams, to post issuance analysis and all related tasks during the process
• Shall be responsible for coordinating all aspects of a debt closing, including the appropriate investment of proceeds (i.e., construction and reserve funds, if applicable), providing an actual debt service table based on accepted coupon rates and arranging for the printing, execution, signing and delivery of applicable documents.

Be available on a regular basis for consultation with City staff.

1.2.3 Additional Services
Produce annually derivative and investment valuation reports. The information must include or satisfy the following.
 Measurement and effectiveness based on GASB or other industry standards as required or applicable including, but not limited to:
o GASB 53
o GASB 72
o Future GASB statements which impact this area
 Provide historical and projected debt service costs for variable rate issuances that the City includes in the Annual Comprehensive Financial Report.

1.3 GENERAL REQUIREMENTS
Assist City in monitoring the City’s debt portfolio in a fiduciary capacity, identifying the best financing strategies to optimize the lowest financing cost based on the guidelines defined under the City’s Debt Management Policy and Federal/State statutes. Provide annual derivative valuation reports to meet the financial statement requirements under GASB 53 and 72.

1.4 DELIVERABLES/REPORTS
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20 Mark-to-Market valuation of variable rate bonds
GASB 53 Effectiveness Testing Results
GASB 72 Fair Value Measurements
Historical and Projected Variable Rate Debt Service Calculations

1.5 SAMPLE REPORTS
Mark-to-Market valuation of variable rate bonds
GASB 53 Effectiveness Testing Results
GASB 72 Fair Value Measurements
Historical and Projected Variable Rate Debt Service Calculations

1.6 ACCOUNT MANAGER/SUPPORT STAFF
Proposer shall include Names, Classification/Title and years of experience. Proposer shall include resumes for each individual who would be providing services to the City, which will include experience/qualifications, education and licenses/designations. Also, include the office location (s) from which those individuals work.

1.7 REQUIRED LICENSES
Prior to beginning any service that shall be furnished under this specification, the bidder shall secure the appropriate Business/Delivery license from the City of Modesto.

Business/Delivery license information may be obtained by calling (209) 577-5389.

If the bidder is furnishing any labor or service including installation or maintenance, the bidder shall possess the appropriate California Contractor's license(s) at the time the proposal is submitted. A contract shall not be awarded to a bidder that does not possess the appropriate Contractor's license(s). The appropriate Contractor's license(s) is that specified in this request, or if not specified, that which is otherwise required by law, and qualifies the Contractor to do business in the State of California.

1.8 INSURANCE
The CONTRACTOR shall provide, at its own expense, and maintain at all times the following insurance with insurance companies licensed in the State of California and shall provide evidence of such insurance to the CITY as may be required by the City Clerk of the CITY. The policies or certificates thereof shall provide that, thirty (30) days prior to cancellation or material change in the policy, notices of same shall be given to the Risk Manager of the CITY by registered mail, return receipt requested, for all of the following stated insurance policies.

A. Workers' Compensation - in compliance with the statutes of the State of California, plus employer's liability with a minimum limit of liability of $1,000,000.

B. General Liability - insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. The insurance shall indicate on the certificate of insurance the following coverage and indicate the policy aggregate limit applying to: premises and operations; broad form contractual; independent #13..
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21 contractors and subcontractors; products and completed operations; and/or professional liability.

C. Automobile Liability – insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover any automobile for bodily injury and property damage.

D. Professional Liability – insurance with a minimum limit of $1,000,000 per claim and $2,000,000 policy aggregate. If coverage is on a claims-made basis it shall be maintained for at least three (3) years following completion of the work.

If at any time any of said policies shall be unsatisfactory to the CITY, as to form or substance or if a company issuing such policy shall be unsatisfactory to the CITY, the CONTRACTOR shall promptly obtain a new policy, submit the same to Risk Manager for approval and submit a certificate thereof as hereinabove provided. Upon failure of the CONTRACTOR to furnish, deliver or maintain such insurance and certificates as above provided, this Agreement, at the election of the CITY, may be forthwith declared suspended, or terminated. Failure of the CONTRACTOR to obtain and/or maintain any required insurance shall not relieve the CONTRACTOR from any liability under this Agreement, nor shall the insurance requirements be construed to conflict with or otherwise limit the obligations of the CONTRACTOR concerning indemnification. The CITY, it agents, officers, employees, and volunteers shall be named as an additional insured on all insurance policies required herein, except Workers' Compensation.

The Workers' Compensation insurer shall agree to waive all rights of subrogation against the CITY, its agents, officers, employees, and volunteers for losses arising from work performed by CONTRACTOR for the CITY.

The CONTRACTOR's insurance policy(ies) shall include a provision that the coverage is primary as respects the CITY; shall include no special limitations to coverage provided to additional insured; and, shall be placed with insurer(s) with acceptable Best's rating of A:VII or with approval of the Risk Manager.

For any claims related to this project, the CONTRACTOR’s insurance coverage shall be primary insurance as respects the Entity, its officers, officials, employees, and volunteers.

Any insurance or self-insurance maintained by the Entity, its officers, officials, employees, or volunteers shall be excess of the Contractor’s insurance and shall not contribute with it.
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22 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

GENERAL REQUIREMENTS

2.0 PROPOSAL SUBMITTAL
Proposer should submit two “inked” (preferably blue ink) signed original proposal documents, plus two (2) copies of the signed original proposal document and one (1) electronic copy submitted via USB. The original proposal document shall be clearly marked. Photocopies do not constitute an original proposal document.

FAILURE TO FURNISH AT LEAST ONE “INKED” SIGNED ORIGINAL PROPOSAL DOCUMENT MAY RESULT IN DISQUALIFICATION.

It is the responsibility of the proposers to identify information in their proposal responses that they consider confidential under the California Public Records Act. To the extent that the City agrees with that designation, such information will be held in confidence whenever possible. All other information will be considered public.

All costs associated with the preparation of this proposal shall be borne by the proposer.

All exceptions taken to these specifications shall be specifically and clearly identified on the Exceptions, Clarifications, and Amendments Form. Failure to comply with this provision is grounds for proposal rejection.

Exceptions taken shall not affect the overall performance and quality of the services required by the City. The Purchasing Manager or her designated agent shall make the final decision regarding the acceptability of the services with exceptions.

Proposal shall be made in the format specified below. All requested exhibits shall be submitted with the completed Proposal and in the designated format. No oral, telegraph, telephone, facsimile or electronic proposals will be accepted. Failure to comply with all requirements may result in proposal rejection.

2.1.1 PROPOSAL PREPARATION
Proposal shall be submitted in a three-ring binder with section tabs (A through Z as needed) with responses in the order described below. In those instances where specific questions are asked, each question shall be repeated in the proposal with the response following the question. Extraneous or marketing information shall not be included.

If a service requirement cannot be met, Proposer shall indicate “No Proposal” in the relevant section of the proposal. In this case, proposer may offer an alternative equivalent service.

2.1.2 ACCEPTANCE/REJECTION OF IRREGULAR PROPOSALS
A contract shall be awarded to the proposer whose proposal most closely satisfies the needs of the City and is deemed the most advantageous to the City. The City reserves the right to reject any or all proposals or to waive any informalities or minor irregularities in a proposal.
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23 2.1.3 COMPLETE PROPOSAL SUBMITTAL
The following documents constitute the makeup of a complete proposal submittal:
 Proposal Acknowledgement (Signature Form)
 Pricing Schedule (Signature Form)
 Exceptions, Clarifications, Amendments
 References
 Financial Interest Disclosure (Signature Form)
 Addenda Acknowledgment Form (If Applicable)
 Company History Statement
 Minimum Qualifications (Financials)
Failure to furnish any of these documents may result in disqualification.

2.1.4 PROPOSAL PREPARATION
Proposals shall be prepared in the order listed in Section 2.1.3 Complete Proposal Submittal. Proposals should be tabbed with dividers. Tabbed dividers shall be clearly marked indicating the appropriate document.

2.2 COMPLIANCE
Proposers are required to sign the “Pricing Schedule, Financial Interest Disclosure and Proposal Acknowledgement Forms” of this proposal document, thereby acknowledging they are in full compliance with all requirements of RFP No. 2122-01, and any addendum to such proposal. Failure to comply may result in disqualification.

The proposer guarantees that the offered equipment, material or services meet all safety requirements applicable in accordance with Cal-OSHA regulations and any other rule or regulation required by the City of Modesto.

2.3 NON-COMPLIANCE
If you cannot comply with a specification requirement, note as an addendum on the Exceptions, Clarifications, Amendments Form specification paragraph, your exception, and your recommendation. The Purchasing Manager will evaluate your recommendation.

If after evaluation it is determined that the proposer is not in compliance with the specification, the proposal may be rejected.

2.4 PRICING FORMAT
All labor, initial background checks, drug-screening, licenses and insurance necessary to perform the services shall be included in the proposed pricing.

Unless otherwise stated, the proposer agrees that, in the event of a price decline, the benefit of such lower pricing shall be extended to the City. #13..
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24 2.5 PRICING SCHEDULE
Proposers shall use the Pricing Schedule Form to present their proposed pricing. No other form or format shall be accepted.

2.6 AWARD OF PROPOSAL
Proposals shall be evaluated by a committee and will be ranked in accordance with the RFP section entitled “Evaluation Criteria.”
The committee shall recommend award to the proposer who, in its opinion, has submitted a proposal that best serves the overall interests of the City, and attains the highest overall point score. Award may not necessarily be made to the proposer with the lowest price.

The City reserves the right to decline to award a contract if it is determined that the proposed pricing is not competitively priced based on similar contracts with public agencies within the State of California.

The City reserves the right to select that proposal, which best suits the City’s needs.

Regardless of City staff’s recommendation, the City Council reserves the right to award a contract to the proposer that best suits the City’s needs as determined by the City Council whether or not said award is consistent with City staff’s recommendation for award.

2.7 EVALUATION PROCESS
Proposals shall be evaluated using a three (3) step process:

Level 1 – Minimum Qualifications Review: The City shall perform an initial responsiveness review to determine compliance and shall notify disqualified Proposers.

Proposers that do not meet the “Minimum Qualifications” requirements shall be deemed non-responsive and/or/non-responsible to this RFP and will receive no further consideration.

Level 2 – Proposal Content and Cost Ratings: Proposals that meet Level 1 Minimum Qualifications Review shall be evaluated based on the evaluation criteria “Proposal Evaluation Criteria”. Proposer submittals shall be evaluated and scored. Proposer cost information shall be evaluated as part of Level 2 evaluation process.

Level 3 – Short List (Oral Presentations): At the sole discretion of the Evaluation Committee, a “short list” of proposers may be developed of the highest rated written submissions, based on Level 1 and Level 2 rankings. If the Evaluation Committee chooses, these proposers would be invited to give presentations. Final scoring of “short list” proposals shall be completed upon the conclusion of presentations.

2.8 TERM OF CONTRACT
The term of the contract shall be for a period of three (3) years, with three (3) one-year extension options at the sole discretion of City, for a total of up to six (6) years.

A. Pricing shall remain firm for the first three (3) years of any contract, which may be awarded pursuant to this RFP.
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25 B. Price increases for subsequent contract years four, five and six shall not exceed the Consumer Price Index (CPI) for West Urban Area in any one contract year, and shall be negotiated through the Purchasing Division. Requests for price increases shall be submitted by Contractor in writing, at least sixty (60) days prior to the annual anniversary date of the contract to be effective for the subsequent year.

2.9 QUANTITIES
The successful proposer shall be required to provide whatever quantities may be required during the contract term. No minimum or maximum is guaranteed or implied.

2.10 FUNDING
All annual extensions are based upon continuous funding for that purpose by the City Council. Failure to fund any annual extension shall result in an immediate termination of the agreement without redress.

2.11 INSPECTION AND ACCEPTANCE
Whenever the product or service provided by the supplier has been delivered to the delivery point, the designated agent shall make the final inspection and acceptance.

If upon initial inspection the product or service is found to be defective in its construction or deficient in any of the requirements of this specification, the supplier shall remedy or remove said product in an acceptable manner at the supplier's expense. No compensation shall be allowed for such correction of product, labor, or transportation of product.

2.12 CITY BUSINESS LICENSE
Prior to beginning any service, that shall be furnished under this specification and proposal, the Proposer shall secure the appropriate Business license from the City of Modesto. Business license information may be obtained by calling (209) 577-5389.

2.13 TERMINATION OF SERVICES
Refer to the “Sample Agreement” for termination of services

2.14 ELECTRONIC PAYMENT
Electronic Payment Method:

The City of Modesto provides an Epay Program which involves payment of invoices by a secure Visa account number assigned to the supplier after award of bid or contract.

Notification of payments and required invoice information is issued to the supplier’s designated Accounts Receivable contact by email remittance advice at time of payment.

During the evaluation process preference may be shown to proposers that agree to accept Epay for payment of invoices. Please indicate on the Pricing Schedule whether or not your company will accept the City’s Epay Program.

Invoice to: City of Modesto
[email protected]
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26 2.15 OTHER GOVERNMENT/PUBLICLY FUNDED AGENCIES
If mutually agreeable to all parties, the issuance of any resultant contract/purchase order referencing these specifications and modified by mutual agreement between all parties may be extended to other government or publicly funded agencies. It shall be understood that all terms and conditions as specified herein shall apply.

2.16 NON-DISCRIMINATION
A. During the performance of this contract, Contractor and its subcontractors shall not unlawfully discriminate against any employee or applicant for employment because of race, color, ancestry, religion, sex, national origin, marital status, age, medical condition (cancer related), physical handicap (including AIDS), or sexual orientation. Equal employment opportunity extends, but is not limited to recruitment, compensation, benefits, layoff, termination, and all other conditions of employment. Contractor and subcontractors shall ensure that the evaluation and treatment of their employees and applicants for employment are free of such discrimination. Contractor and subcontractors shall comply with the provisions of the Fair Employment and Housing Act (Government Code, Section 12900 et seq.) and the applicable regulations promulgated thereunder (California Administrative Code, Title 2, Section 7285.0 et seq.). The applicable regulations of the Fair Employment and Housing Commission implementing Government Code, Section 12900, set forth in Chapter 5 of Division 4 of Title 2 of the California Administrative Code are incorporated into this contract by reference and made a part hereof as if set forth in full.

B. Contractor and its subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement.

C. Contractor shall include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform work under the contract.

D. Contractor shall permit access by representatives of the Department of Fair Employment and Housing and the City upon reasonable notice at any time during the normal business hours, but in no case less than twenty-four (24) hours notice, to such of its books, records, accounts, other sources of information and its facilities as said Department or City shall require to ascertain compliance with this clause.

2.17 NON-DISCRIMINATION OF THE HANDICAPPED

CERTIFICATION OF PROPOSER REGARDING NON-DISCRIMINATION OF THE

HANDICAPPED
By executing this agreement, the proposer hereby certifies that he/she is in compliance with the Americans with Disabilities Act of 1990, the applicable administrative requirements promulgated in response thereto, and any other applicable Federal laws and regulations relating to handicap discrimination and participation, and will continue to do so for at least the duration of the agreement and any extensions thereof. #13..
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27 2.18 DRUG FREE WORKPLACE
Proposer/Contractor certifies that he/she is in compliance with Sections 8350 - 8355 of Chapter 5.5 of the Government Code, Drug Free Workplace Act. Every person or organization awarded a contract/purchase order or grant for the procurement of any property or service from any state agency (city) shall certify to the contracting or granting agency that it will provide a drug free workplace.

2.19 HOLD HARMLESS AGREEMENT
The CONTRACTOR shall hold the CITY, its agents, officers, employees, and volunteers, harmless from and save, defend and indemnify them against any and all claims, losses, liabilities and damages from every cause, including but not limited to injury to person or property or wrongful death, with the indemnity to include reasonable attorney's fees, and all costs and expenses, arising directly or indirectly out of any act or omission of CONTRACTOR, whether or not the act or omission arises from the sole negligence or other liability of CITY, or its agents, officers, employees, or volunteers relating to or during the performance of its obligations under the Agreement.

2.20 ASSIGNMENT OF RIGHTS
CONTRACTOR offers and agrees, and will require all subcontractors and suppliers to agree, to assign to the CITY all rights, title, and interest in and to all causes of action it and they may have under Section 4 of the Clayton Act (15 United States code, Section 15) or under the Cartwright Act (Business and Professions Code, Section 16700 et seq.), arising from the purchase of goods, services, or materials pursuant to this contract or any subcontract. The assignment made by CONTRACTOR and all assignments made by subcontractors and suppliers shall be made and become effective at the time the CITY tenders final payment to CONTRACTOR, without further acknowledgment by the parties (Government Code, Sections 4550-4554).

2.21 CITY PROCESS/PROCEDURE APPROVALS
CITY approval of any process or procedure shall not relieve the proposer of his/her responsibility to furnish the required items and service meeting all specifications contained herein.

2.22 PROPOSAL/SELLER REPRESENTATION
The proposer/seller represents that:

A. He/She has had an opportunity to examine and has examined any and all of the documents, including specifications, any resultant purchase order and supporting data, and that he/she has, from the information contained in such documents, specifications, and data, fully acquainted him/her with all conditions relevant to the work.

B. He/She has made all reasonable investigations essential to a full understanding of the difficulties, which may be encountered in performing the work.

C. He/She will complete the work for the compensation stated above. #13..
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28 D. He/She assumes full and complete responsibility for all conditions relevant to the work and all risks in connection therewith.

E. In addition thereto, the proposer/seller represents that he/she is fully qualified to do the work in accordance with the terms of any Purchase Order issued within the time specified in it.

F. Anything mentioned in the specifications and not in the Purchase Order, or mentioned in the Purchase Order and not mentioned in the specifications, shall be of like effect as if shown or mentioned in both. In case of difference between the specifications and the Purchase Order, the Purchase Order shall govern.

2.23 FAILURE TO PERFORM SATISFACTORY
It is agreed and understood that if the CONTRACTOR fails to perform the work as specified herein, CITY's representative may (1) consent to accept such unsatisfactory service with an appropriate adjustment in contract price, based on established cost factors, (2) have such required work done by CITY forces or otherwise, and charge the cost thereof to the CONTRACTOR, or (3) recommend termination of contract between said CONTRACTOR and the City of Modesto. Those discrepancies and deficiencies in the work that remains uncorrected after the date set for correction may be the necessary justification for a billing adjustment in the month following the occurrence. Unless otherwise negotiated, billing adjustments for this incomplete or uncorrected work shall be permanent retention of 100% of the estimated monthly cost for the work not corrected or completed.

2.24 CONTRACTOR'S RESPONSIBILITY FOR DAMAGES
If CONTRACTOR damages any property belonging to the CITY, the CITY may either retain from the money due to CONTRACTOR an amount sufficient to repair the damage or require CONTRACTOR to repair the damage to the satisfaction of the CITY at CONTRACTOR's expense.

2.25 LABOR FORCE AND SUPERVISION
CONTRACTOR shall provide sufficient labor at all times to carry out the project properly and shall ensure that fully experienced competent licensed workers who are skilled in the type of work required are employed. CONTRACTOR shall ensure that supervision is provided at all times while any work under this contract is being performed. If, in the judgment of the CITY, any person is incompetent or disorderly, CONTRACTOR shall promptly remove such person from the work for the duration of the contract.

2.26 PROTEST AND APPEAL PROCEDURES
Potential offerors, bidders, contractors, and subcontractors wishing to protest or appeal a procurement or contracting decision by the City of Modesto must follow the procedures provided by the section. Protests or appeals which are not submitted in accordance with these procedures will not be reviewed.

DEFINITIONS
For the purposes of this procedure: "Days" means working days in which City Hall is open for business, excluding holidays and weekends.
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29 "Filing Date" or "Submission Date" means the date of receipt by the City Clerk’s office of the City of Modesto.
"Interested Party" means an actual or prospective bidder or offeror, or any contractor or subcontractor identified by name in any bid or proposal. "Bid" includes the term "offer" or "proposal" as used in the context of formal, informal, or negotiated procurements.
"Announced Decision" includes the term “Notice of Intent to Award Letter”. Once the City has issued an Announced Decision, the date noted will begin the time that an Interested Party may lodge a protest. Procurements valued at $50,000 or less normally will not have an Announced Decision.

A. PROTEST PROCEDURES

1. Any interested party may lodge a written protest to an Announced Decision with the City of Modesto's Purchasing Manager no later than ten (10) days after the Announced Decision.

2. The protest shall be delivered or sent by registered mail and postmarked by the deadline, or protest will be automatically rejected. Protestors who choose to be represented by legal counsel are responsible for the associated expenses.

3. The protest shall be accompanied by a certified or cashier's check in the amount of $300.00, (EXCEPT FOR PROTESTS OF FEDERALLY
FUNDED PROJECTS) or in such other sum as the City may establish, made payable to the Clerk of the City of Modesto. Protests filed without the requisite fee will be rejected without any additional review.

4. The protest filed with the Purchasing Manager shall:
a. Include the name, address, and business telephone number of the protestor;
b. Identify the project under protest by name, Request for Bid (RFB)/Request for Proposal (RFP) number, and bid/RFP date; c. Contain a concise statement of the grounds for protest; d. Include all supporting documentation, if any.

Documentation submitted after filing deadline will not be reviewed.

All protests shall either be delivered to:
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30 City Clerk’s Office
Attn: Purchasing Manager
1010 Tenth St. Suite 6600
Modesto CA 95354
Or mailed to:

City Clerk’s Office
Attn: Purchasing Manager
PO Box 642
Modesto CA 95353
B. PROTEST REVIEW (ANNOUNCED DECISION)

1. Protest to Purchasing Manager
Upon receipt of a complete and timely protest, the Purchasing Manager shall review all the submitted materials and shall create and retain a written record of the review. The Purchasing Manager shall respond at least generally to each material issue raised in the protest not later than ten (10) days after receipt of the protest. Notice of the Purchasing Manager's decision may be given by letter mailed through U.S. Postal Service.

2. Appeal to Deputy City Manager
The Purchasing Manager's decision may be appealed in writing to the City of Modesto's Deputy City Manager(s) no later than ten (10) days after the date of the Purchasing Manager’s Decision. The scope of the appeal shall be limited by the issues raised in the initial protest to the Purchasing Manager. The Deputy City Manager shall not be permitted to review any newly raised issues. The Deputy City Manager shall review the appeal, accompanying supporting documents, if any, and the written record of the protest review by the Purchasing Manager.

A written record of the Deputy City Manager's review shall be created and maintained. The Deputy City Manager shall give notice of his or her decision to the protestor within ten (10) days after receipt of appeal.

All protest appeals shall either be delivered to:

City Clerk’s Office
Attn: Deputy City Manager
1010 Tenth St. Suite 6600
Modesto CA 95354
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31 Or mailed to:

City Clerk’s Office
Attn: Deputy City Manager
PO Box 642
Modesto CA 95353

3. Appeal to City Council
Any protestor seeking to appeal to the decision of the Deputy City Manager may appeal in writing to the City Council by filing with the City Clerk a written notice of such appeal not later than fifteen (15) business days after the date of the Deputy City Manager's decision.

The City Clerk will calendar the protest for Council hearing and give notice of the time and place of the hearing as provided in Modesto Municipal Code Sections 1-4.01 through 1-4.05.

The City Council is the highest authority of the City of Modesto. It is possible that the City Council may reverse the decision of any City staff member at the hearing, or provide other direction to staff. In such cases, staff cannot reverse a City Council decision.

All protests shall either be delivered to:

City Clerk’s Office
Attn: City Council
1010 Tenth St. Suite 6600
Modesto CA 95354
Or mailed to:

City Clerk’s Office
Attn: City Council
PO Box 642
Modesto CA 95353
C. PROTESTS OF PROCUREMENTS EXCEEDING $250,000.00
Interested parties protesting procurements exceeding $250,000.00 shall comply with the procedures contained herein, except that in lieu of appeal to the Deputy City Manager, a protestor may request that the protest be heard and decided at an administrative hearing.

A written request for administrative hearing shall be accompanied by a certified or cashier's check in the amount of $1,500.00, (EXCEPT FOR PROTESTS OF FEDERALLY FUNDED PROJECTS; Refer to Purchasing Procedures Manual for the Transit Division and Federal Transit Administration Funded Purchases, #13..
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32 Chapter 14) payable to the City of Modesto, and shall be received by the Purchasing Manager not later than fifteen (15) days after dispatch of the Purchasing Manager's decision. The request for hearing shall include the specific grounds of the appeal.

The City of Modesto shall select and engage an impartial and qualified person to act as hearing officer in the pending protest. The protestor shall have the right to twice reject the selected hearing officer, provided that the City is notified of such rejection within three (3) days of notice to protestor of the name of the hearing officer.

The protest shall be heard not later than twenty (20) days after receipt of protestor's request for hearing and the selection of a hearing officer. Protests not heard in a timely manner shall be deemed withdrawn, unless the City and the protestor mutually agree otherwise in writing. The protestor’s failure to accept a hearing officer after the third attempt by City staff to identify an impartial hearing officer shall be deemed a withdrawal of the protest.

The costs of the hearing officer and expenses of the protest shall be borne by the protestor. The sums deposited with the request for hearing shall be credited to the costs of the hearing officer and other hearing expenses.

The decision of the hearing officer shall be deemed as the final decision of the City, and no other appeal to City Staff or body shall be permitted.

D. PROCUREMENTS OBTAINED WITH FEDERAL FUNDS

1. If the protested procurement involves federal funds, e.g., from the Federal Transit Administration (FTA) of the United States, the Deputy City Manager, City Council, or hearing officer shall give notice, accompanying their respective decisions, to the protestor that he or she has the right to appeal to the appropriate federal agency, for which an agency name, contact (where available) and address shall be provided by City staff. Such an appeal shall be filed with the appropriate agency within seven (7) business days of the dispatch or rejection notices to the protestor. Federal agencies may entertain protests alleging that the City has failed to adopt written protest procedures or has failed to follow such procedures. Appeals to the Federal Transit Administration (FTA) shall comply with FTA Circular 4220.1E and the amendments and supplements thereto. Additional information regarding protesting procurements obtained with Federal Funds can be found in the Purchasing Procedures Manual for the Transit Division and Federal Transit Administration Funded Purchases, Chapter 14.

2. The City Council is the highest authority of the City of Modesto. It is possible that the City Council may reverse the decision of any City staff member at the hearing before Council on the procurement at hand. In such cases, no internal appeal is possible since staff may in #13..
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33 no case reverse a City Council decision. In such an event, a disappointed transit bidder or a contract involving expenditures of Federal funds shall have the right to appeal the City Council decision directly to the Federal Transit Administration.
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34 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-01

MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT

SAMPLE AGREEMENT
This Agreement, made and entered into in the City of Modesto, State of California, this ____ day of _________, 2022, by and between the City of Modesto, a municipal corporation of the State of California, hereinafter called CITY, and Contractor, hereinafter called

CONTRACTOR,
W I T N E S S E T H:

WHEREAS, the Modesto City Council adopted Resolution No. 2022-_____ authorizing the award of proposal and contract for the furnishing of Municipal Advisory Services and Annual Derivative Valuation Report to Contractor, attached hereto as Exhibit “A” and made a part hereof, and
WHEREAS, the CONTRACTOR provided a responsive and responsible submittal that best meets the CITY needs, attached hereto as Exhibit “B” and made a part hereof, and
WHEREAS, the CITY and CONTRACTOR shall enter into an agreement for the furnishing of MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT, as described in RFP No. 2122-01 – MUNICIPAL ADVISORY SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT, attached hereto as Exhibit “C” and made a part hereof, and
NOW, THEREFORE, the parties hereto mutually agree as follows:

1. SCOPE OF WORK.
a. CONTRACTOR shall furnish MUNICIPAL ADVISORY
SERVICES AND ANNUAL DERIVATIVE VALUATION REPORT insofar as such scope of services are specified in Exhibit “B”, and in strict accordance with the conditions of the complete #13..
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35 Contract.
b. CONTRACTOR shall do and perform the work contemplated hereby in a good and workmanlike manner under the direction of and to the satisfaction of the City Representative.
c. CONTRACTOR shall furnish said services at the following contracted rates, not to exceed $_________________ annually:

Unit Price

2. CITY REPRESENTATIVE:

Contract Administrator is:
________________________ ____________________________
The City Representative is not authorized to commit the CITY to changes in specifications, requirements, or scope of work, changes in price(s), period of performance or delivery date(s) or method of shipment. Changes of a contractual or business nature shall be effected only by written change to the contract, issued by the City of Modesto, Purchasing Division.

3. TERM OF CONTRACT:
#13..
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36 The term of the contract shall be for a period of three (3) years, with three (3) oneyear extension options at the sole discretion of CITY, for a total of up to six (6) years.

Year 1: December 15, 2022 through December 31, 2023
Year 2: January 1, 2024 through December 31, 2024
Year 3: January 1, 2025 through December 31, 2025
Year 4: January 1, 2026 through December 31, 2026
Year 5: January 1, 2027 through December 31, 2027
Year 6: January 1, 2028 through December 31, 2028
Pricing as set forth in Section 1.c. above shall remain firm for the first three (3) years of the contract.

Pricing shall remain firm for the first three (3) years of the contract.

Price increases for subsequent contract years, four, five and six shall not exceed the Consumer Price Index (CPI) for West Urban Area in any one contract year and shall be negotiated through the Purchasing Division. Requests for price increases shall be submitted by CONTRACTOR in writing, sixty (60) days prior to the annual anniversary date of the contract to be effective for the subsequent year.

4. LIABILITY INSURANCE:

CONTRACTOR shall provide at its own expense and maintain at all times the following insurance with insurance companies licensed in the State of California and shall provide evidence of such insurance to CITY as may be required by the Risk Manager. The policies or certificates thereof shall provide that, thirty (30) days prior to cancellation or material change in the policy, notices of same shall be given to the Risk Manager of CITY by registered mail, return receipt requested, for all of the following stated insurance policies. #13..
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37 (a) Workers' Compensation - In compliance with the statutes of the State of California, plus employer's liability with a minimum limit of liability of $1,000,000
(b) General Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. This insurance shall indicate on the certificate of insurance the following coverages and indicate the policy aggregate limit applying to: premises and operations; broad form contractual; independent consultants and subcontractors; products and completed operations as applicable.
(c) Automobile Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover any automobile for bodily injury and property damage.
(d) Professional Liability - insurance with a minimum limit of $1,000,000 per claim and $2,000,000 policy aggregate. If coverage is on a claims-made basis it shall be maintained for at least three (3) years following completion of the work.

If at any time any of said policies shall be unsatisfactory to CITY, as to form or substance, or if a company issuing such policy shall be unsatisfactory to CITY, CONTRACTOR shall promptly obtain a new policy, submit the same to Risk Manager of CITY for approval and submit a certificate thereof as herein above provided. Upon failure of CONTRACTOR to #13..
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38 furnish, deliver or maintain such insurance and certificates as above provided, this Agreement, at the election of CITY, may be forthwith declared suspended, or terminated. Failure of CONTRACTOR to obtain and/or maintain any required insurance shall not relieve CONTRACTOR from any liability under this Agreement, nor shall the insurance requirements be construed to conflict with or otherwise limit the obligations of CONTRACTOR concerning indemnification. CITY, and its agents, officers, employees, and volunteers shall be named as an additional insured on all insurance policies required herein, except Workers ’ Compensation, Professional Liability and Financial Institution’s Fidelity. The Workers ’ Compensation insurer shall agree to waive all rights of subrogation against CITY, its agents, officers, employees, and volunteers for losses arising from work performed by CONTRACTOR for CITY.

CONTRACTOR’S insurance policy(ies) shall include a provision that the coverage is primary as respects CITY; shall include no special limitations to coverage provided to additional insured; and, shall be placed with insurer(s) with acceptable Best’s rating of A:VII or with approval of the Risk Manager of CITY. The CONTRACTOR must deliver certificates evidencing existence of the insurance to the City prior to the time contract is signed.

CONTRACTOR agrees to provide CITY with a separate endorsement evidencing proof of City ’s additional insured status required herein (both general and automobile liability) as well as a separate endorsement for the Workers’ Compensation insurer ’ s waiver of all subrogation rights as stated above. Every endorsement shall identify the policy number.

CONTRACTOR shall provide CITY with separate an endorsement evidencing proof of the CITY’s additional insured status as to the general liability insurance policy. In addition, CONTRACTOR shall provide CITY with a Workers Compensation subrogation waiver by way of a separate endorsement. All endorsements referenced above must include the applicable policy number.
#13..
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39 For any claims related to this project, the CONTRACTOR’S insurance coverage shall be primary insurance as respects the Entity, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the Entity, its officers, officials, employees, or volunteers shall be excess of the CONTRACTOR’S insurance and shall not contribute with it.

CONTRACTOR further agrees that the amount of insurance required may from time to time be adjusted by CITY ’s Risk Manager and CONTRACTOR agrees to file a new insurance certificate with CITY’s City Clerk evidencing the new amounts after a thirty (30) day written notice from CITY’s Risk Manager.

5. INDEMNITY:

The CONTRACTOR shall hold the CITY, its agents, officers, employees, and volunteers, harmless from and save, defend and indemnify them against any and all claims, losses, liabilities, judgments or damages from every cause, including but not limited to injury to person or property or wrongful death, including reasonable costs and expenses of defense of any judicial or administrative action, arising directly or indirectly out of any negligent or intentional act or omission of CONTRACTOR, or its agents, officers, employees, or volunteers relating to or during the performance of its obligations under this Agreement.

CONTRACTOR’s obligation to defend, indemnify, and hold the CITY, its agents, officers, and employees harmless under the provisions of this paragraph is not limited to or restricted by any requirement in this Agreement for CONTRACTOR to procure and maintain a policy of insurance.

6. ARBITRATION:

Any dispute or claim arising or related to this Agreement, its performance, breach, or interpretation (including issues about its validity or enforceability), shall be exclusively, (except as approved below) resolved by final binding arbitration before the #13..
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40 American Arbitration Association (AAA), utilizing its Commercial Arbitration Rules. One Arbitrator shall be selected using AAA procedures. The Arbitrator shall use all reasonable efforts to minimize discovery and to complete the arbitration proceedings as expeditiously as possible. The Arbitrator shall render a written decision within thirty (30) calendar days of the hearing. The Arbitrator will not award attorney’s fees, or punitive, incidental, consequential, treble or other multiple or exemplary damages, and the parties hereby agree to waive and not seek such damages. Either party may seek judicial relief to compel the other party to comply with the provisions of this Section, or injunctive or other equitable relief to protect its intellectual property rights, provided (unless prohibited by applicable law) that the remainder of the dispute or claim is submitted to arbitration. The arbitration shall be held in Modesto California; both parties give their irrevocable consent to jurisdiction of courts of or in the State of California, as well as processes of the AAA in California. Awards shall be final, binding and non-appealable (except on the minimal grounds required under the Federal Arbitration Act or other applicable law). All awards may be filed with one or more courts, state, federal or foreign having jurisdiction over the party against whom such award is rendered or its property, as a basis of judgment and of the issuance of execution for its collection.

7. GOVERNING LAW:

8. COMMENCEMENT AND COMPLETION OF THE WORK:

The work contemplated herein shall be commenced as immediately after receipt of the Notice to Proceed for this contract. The Notice to Proceed shall not be issued until the contract administrator receives and has on file:
#13..
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41 Proofs of insurance (approved by Risk Management); and Executed Agreement and all exhibits thereto.

9. TERMINATION OF SERVICES:

Termination by City for Convenience
The City may also terminate the Contractor's performance under the Agreement, either in whole or in part, at its own discretion, or when conditions encountered during the Work make it impossible or impracticable to proceed, or when the City is prevented from proceeding with the Agreement by act of God, by law, or by official action of a public authority, or upon a determination by the City that such termination is in the best interest and convenience of the City, or whenever the City is prohibited from completing the Work for any reason. The City shall provide no less than ten (10) calendar day’s written notice of its intent to terminate the Agreement for convenience, and shall endeavor to provide the Contractor with consultation with the City prior to termination.

Post-Termination Procedure
Upon receipt of a written notice of termination pursuant to either of the foregoing paragraphs, the Contractor shall:
a. Cease its work as directed in the notice of termination as of the termination date and see to it that its employees, subcontractors and #13..
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42 agents are notified of such termination and act as specified in the notice of termination;
b. Terminate all orders and Subcontractors except as necessary to complete any portion of the Work that is not terminated; c. If directed in writing by the City to do so, assign all right, title and interest in subcontracts and materials in progress to City, in which case the City will have the right at its discretion to settle, or pay any or all claims arising out of the termination of such subcontractors but in no event shall recovery by any Contractor or subcontractor include lost profits for portions of the Work not completed or undertaken, including materials not delivered; d. Deliver or otherwise make available to the City all data, drawings, specifications, reports, estimates, summaries and such other information and material as may have been accumulated by the Contractor in performing the Work whether completed or in process; e. Settle outstanding liabilities and claims, subject to the approval of City;
f. Complete performance of such part of the Work as has not been terminated;
g. Take such other actions as may be necessary, or as may be directed by the City for the protection and preservation of the Work and/or property related to the Work;
h. If City so requests, and at City's cost, Contractor shall provide sufficient oral or written status reports to make City reasonably aware of the status of Contractor's work on the project. #13..
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43 i. The Contractor understands and agrees that City may, in City's sole discretion, refuse to pay Contractor for that portion of Contractor's services which were performed by Contractor on the project prior to the termination date and which remain
unacceptable and/or not useful to City as of the termination date.

City will pay Contractor an amount based on the percentage of satisfactory work completed in accordance with the notice of termination. The final payment to the Contractor after termination for convenience shall be limited to amounts due and owing under the Agreement at time of termination, including the following:
a. The cost of settling and paying valid claims arising out of the termination of the Work such as subcontractor agreements or contracts for materials;
b. The Agreement price allocable to the portion of the Work properly performed or goods supplied to the work site by the Contractor as of the date of termination, as determined in accordance with the notice of termination, reduced by any sums previously paid to the Contractor.

Authorization to Terminate Agreement
Termination of the Agreement may be invoked by the City Manager, or his/her designee, subject to the right of the Contractor to appeal the City Manager, or his/her designee’s, decision to the City Council. The Contractor shall appeal by notifying the City Clerk in writing within ten (10) calendar days of
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44 receipt of written notification from City of termination of the Agreement. In the event that termination of this Agreement is upheld by the City Council, any cessation of payment of delay claims, extended claims, Eichleay claims, or any other claims for delay shall be retroactive to the date of termination selected by the City Manager, or his/her designee.

10. COMPLIANCE WITH ALL LAWS:

11. CONTRACT DOCUMENTS:

The complete contract between the parties hereto consists of this agreement and the following documents which are incorporated herein by this reference:
a. Resolution No. 2022-_______;
b. CONTRACTOR submittal;
c. RFP No. 2122-01 – Municipal Advisory Services and Annual Derivative Valuation Report;
d. Insurance Certificates,
These documents include important legal requirements, procedures and restrictions and should be reviewed by CONTRACTOR. They are available for review during normal business hours in the Department of Finance, Purchasing Division). All documents specified above are intended to operate so that any work called for in any one and not mentioned in the other, or vice versa, is to be executed the same as if mentioned in all said documents.

12. NOTICES:

Any notice, payment or instrument required or permitted by this Contract to be given or delivered to either party shall be deemed to have been received when personally #13..
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45 delivered, or one calendar week following deposit of the same in any United States Post Office, registered or certified mail, postage prepaid, addressed as follows:

CONTRACTOR: __________________
__________________
__________________
__________________
CITY: City of Modesto
Purchasing Division
P.O. Box 642
Modesto, CA 95353
Each party may change its address for delivery of notice by delivering written notice of such change of address to the other party.

13. SIGNATOR(IES) FOR CONTRACTOR:

The undersigned signator(ies) for CONTRACTOR warrant(s) and represent(s) that he/she/they is/are legally competent to execute the contract and has/have full authority to execute this contract.

14. ASSIGNMENT:

Neither this agreement nor any portion thereof shall be subcontracted or assigned without the written consent of the CITY in each and every instance.

15. WAIVER:

16. HEADINGS NOT CONTROLLING:

Headings used in the Agreement are for reference purposes only and shall not be considered in construing this Agreement.

17. MISCELLANEOUS:

Time is of the essence in every provision of this contract. #13..
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46 18. ENTIRE AGREEMENT:

This Agreement and its exhibits contain the entire understanding between CONTRACTOR and CITY. Additional or new terms contained in this Agreement which vary from CONTRACTOR’S proposal are controlling and are deemed accepted by CONTRACTOR by shipment of any article or other commencement of performance hereunder. All previous proposals, offers and communications relative to this Agreement, whether oral or written, are hereby superseded except to the extent that they have been incorporated into this Agreement.

No future waiver or exception to any of the terms, conditions, and provisions of this Agreement shall be considered valid unless specifically agreed to in writing by all the parties.

19. PARTIAL INVALIDITY:

WITNESS WHEREOF, the CITY OF MODESTO, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attested by its City Clerk under authority of Resolution No. 2018-_______, adopted by the Council of the City of Modesto on the _____________ day of _____________________, 2021 and _____________________has caused this Agreement to be duly executed.

CITY OF MODESTO, CONTRACTOR
A municipal corporation
By:__________________________ By:_________________________________ JOSEPH P. LOPEZ, (Signature)
City Manager
By:_________________________________
(Name & Title)
ATTEST: Date:_______________________________
#13..
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47 By:______________________ By:_________________________________ DANA SANCHEZ, (Signature)
Interim City Clerk
By:_________________________________
(SEAL) (Name & Title)

Date:_______________________________
APPROVED AS TO FORM:

JOSE M. SANCHEZ,
City Attorney
By:_________________________________
JOSE M. SANCHEZ,
City Attorney
By:_____________________________
CHRISTINA D. ALGER
Director of Human Resources (Risk)
Signature Requirements
Corporation:

1.Signature of two (2) officers
or

2.Signature of one (1) officer plus the
corporate seal.

Partnership: Signature of one partner
Sole Proprietorship: Signature of proprietor
#13..
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

February 28, 2023
Date: January 17, 2023
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
Bill Sandhu, Public Works Director
SUBJECT: Updated Pricing for Three Bid Events
CONTACT: Dianne Love, Senior Buyer, [email protected], 209-571-5614 DESCRIPTION:

Consider approving updated pricing for three (3) bid events for Fleet Replacement Vehicles by $110,217. (Funding Source: Fleet Replacement Fund)
STRATEGIC PLAN ELEMENT:

This item advances the City of Modesto 2020-2025 Strategic Plan Area: Governance and Service Delivery: “build community trust in City government through responsive, transparent and efficient service delivery”; Goal J: “build a high-performance organization”.

BACKGROUND:

Every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage, and maintenance costs. Following this process, a Fleet Replacement List is submitted to Council and is approved as part of a new fiscal year’s Fleet Replacement Budget.

Once a unit is replaced and placed into City service, funds for its replacement are charged out as monthly recurring charges until the end of the unit’s service life. These funds are specifically designated for the replacement of City vehicles and equipment.

Fleet Replacements:

IFB Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
2122-36 40320 Low-Profile
Dump Truck
UTL – Water
Construction
2003 83,099 $45,306
This vehicle is used to support utility operations for the Utilities Water Construction Division. #14..
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City Council, February 28, 2023
Updated Pricing for Three Bid Events

Page 2 of 5 ends

Modesto City CouncilFebruary 28, 2023

Modesto City Council
February 28, 2023