Agenda packet — Modesto City Council, May 6, 2025 (part 4 of 5)

5. First Responder shall save and hold harmless AMR and the County of Stanislaus and their officers, employees and agents, from any and all liability for damages, including, but not limited to, monetary loss, judgments, orders of a court, and any other detriment or liability that may arise from any injury to a person or persons, and for damages to property, arising from or out of any negligent or wrongful act or omission of First Responder or its agents, officers, or employees in the performance of the Agreement.

6. First Responder’s obligation to defend, indemnify, and hold the AMR and the County of Stanislaus, and their agents, officers, and employees harmless under the provisions of the paragraphs in this section is not limited to or restricted by any requirement in this Agreement for First Responder to procure and maintain a policy of insurance.

7. AMR agrees to defend, indemnify, save and hold harmless the First Responder and it's officers, employees and agents, from any and all claims, damages, losses, judgments, liabilities, expenses, and other costs including litigation costs and attorney's fees arising out of, resulting from, any negligent or wrongful act or omission of AMR or its agents, officers, or employees in connection with the performance of this Agreement by AMR or AMR’s agents, officers, or employees.

8. AMR shall save and hold harmless First Responder and its officers, directors, agents, and employees, from any and all liability for damages, including but not limited to, monetary loss, judgments, orders of a court, and any other detriment or liability that may arise from any injury to a person or persons and for damages to property arising from or out of any negligent or wrongful act or omission of AMR or its agents, officers, or employees in the performance of the Agreement, or AMR’s promulgation of official rules, regulations, or AMR Policies and Procedures not in existence as of the date of this Agreement.
12) HIPAA Compliance. To the extent mandated by law, each Party shall comply with the privacy provisions of the Health Insurance Portability and Accountability Act of 1996 and the regulations thereunder (“HIPAA”), and with such other requirements of HIPAA that may become effective during the Term. All Patient medical records shall be treated as confidential so as to comply with all state and federal laws. 13) Relationship. In the performance of this Agreement, each Party shall be, as to the other, an independent contractor, and neither Party shall have the right or authority, express or implied, to bind or otherwise legally obligate the other. Nothing contained within this Agreement shall be construed to constitute either Party assuming or undertaking control or direction of the operations, activities or medical care rendered by the other. As to either Party’s employees, nothing contained herein shall be construed in such a manner as to give effect to the notion that either Party shall in anyway assume responsibility for the oversight or provision of the other Party’s employee benefits, including but not limited to the payment of wages, provision of #17..
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health insurance, worker’s compensation, unemployment insurance, tax withholdings, or any and all other commonly accepted benefits of employment. 14) Background Investigation. Each Party warrants and represents that it has performed a background investigation on employees who provide Services or drive vehicles as part of the Services (“Background Investigation”). The Background Investigation includes at least the following:

Social Security Number Verification
Criminal Search (7 years or up to 5 criminal searches)
Employment Verification to include reason for separation and eligibility for reemployment for each employer for 7 years OIG List of Excluded Individuals/Entities
Sex Offender Registry
GSA List of Parties Excluded from Federal Programs
Department of Motor Vehicle Driving History
State and Local Licensure Verification
First responder also warrants and represents that it shall perform a Background Investigation on future employees who will provide Services or drive vehicles as part of the Services. Upon request and from time-to-time, First Responder shall provide AMR with a continuing certification of such Background Investigations. 15) Equal Employment Opportunity. If the provisions of Executive Order 11,246 are applicable to this Agreement, the Parties incorporate the equal employment opportunity clause set forth in 41 C.F.R. part 60-1. If the provisions of Executive Order 13,496 are applicable to this Agreement, the Parties incorporate the clause set forth in 29 C.F.R. part 471, Appendix A to Subpart A.
16) Benefits. This Agreement is entered into for the benefit of the Parties to this Agreement only and shall confer no benefits, direct or implied, on any third persons or parties. The Services provided by First Responder under this Agreement represent an extension and expansion of services the First Responder owes to the public in general and by entering into this Agreement the First Responder does not intend to create a special relationship or duty to the other Party or to the public served by either Party.
17) Laws and Regulatory. The parties: (a) will comply in all material respects with all applicable federal, state and local laws and regulations including, the federal Antikickback statute; (b) represent and warrant that it is not the intent of either party that any remuneration, benefit or privilege provided for under this Agreement shall influence or in any way be based on the referral or recommended referral by either party of patients to the other party or its affiliated providers, if any, or the purchasing, #17..
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leasing or ordering of any services other than the specific services described in this Agreement and any remuneration set forth in this Agreement is fair market value and negotiated at arm-length; (c) will comply with the provisions under the Health Insurance Portability and Accountability Act of 1996 and its regulations; (d) acknowledge that if it is a cost reporting entity that it has been informed of, and will fully and accurately account for, and report on its applicable cost report, the total value of any discount, rebate or other compensation paid pursuant to this Agreement in a way that complies with all applicable federal, state and local laws and regulations that establish a “Safe Harbor” for discounts; (e) represent and warrant that neither it nor any practitioner who orders or provides services on its behalf has been convicted of any conduct that constitutes grounds for mandatory exclusion under any federal or state law and each party further represents and warrants that it is not ineligible to participate in federal or state health care programs or in any other federal or state government payment program; (f) will make available to the other a copy of its code of conduct, anti-kickback policies and other compliance policies, as may be changed from time-to-time; (g) represents and warrants that neither it nor any of its officers or directors have been convicted of a crime against them for: commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (federal, state, or local) contract or subcontract; violation of federal or state antitrust statutes relating to the submission of offers; commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, tax evasion, or receiving stolen property; (h) represent and warrant that it and its personnel are and, shall at all times during the term of this Agreement be, properly credentialed, licensed, certified and in good standing in accordance with all applicable federal, state, and local laws and regulations; and (i) will notify the other party immediately but no less than five (5) days of any actual knowledge contrary to the requirements set forth in this section.
18) Miscellaneous. This Agreement: (a) constitutes the entire agreement between the parties with respect to the subject matter, superseding all prior oral or written agreements with respect to the subject matter; (b) may be amended only by written instrument executed by both parties; (c) may not be assigned by either party without the written consent of the other party (except to affiliates, parents or subsidiaries), such consent not to be unreasonably withheld; (d) shall be binding on and inure to the benefit of the parties and their respective successors and permitted assigns; (e) shall be interpreted and enforced in accordance with the laws of the state where the services are rendered, without regard to the conflict of law’s provisions thereof, and the federal laws of the United States applicable therein; (f) this Agreement may be executed in several counterparts (including by DocuSign or other electronic means), each of which shall constitute an original and all of which, when taken together, shall constitute one agreement; (g) this Agreement shall not be effective until executed by both Parties; (h) if any term or provision of this Agreement is declared to be illegal, invalid or unenforceable for any reason whatsoever by a court of competent jurisdiction, the illegality, invalidity or unenforceability shall not affect the validity of #17..
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the remainder of this Agreement, and to the extent permitted by applicable law, any such term or provision shall be restricted in applicability or reformed to the minimum extent for such to be enforceable; and (i) except as otherwise provided herein, no waiver of any of the provisions of this Agreement shall be valid or effective unless in writing and signed by the Parties hereto; and no waiver of any breach or condition of this Agreement shall be deemed to be a continuing waiver or a waiver of any other breach or condition. The Parties represent and warrant that they have not relied upon any prior or contemporaneous writings, negotiations, proposals, agreements, communications, discussions, or representations. EACH PARTY HERETO HEREBY

IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING BETWEEN THE PARTIES AND ARISING UNDER THIS AGREEMENT. 19) Notices. Any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows, with notice deemed given as indicated: (a) by personal delivery, when delivered personally; (b) by overnight courier then upon delivery thereof as confirmed by such service; (c) by email transmission; or (d) if mailed within the United States, 3 days after deposit in the United States mails, postage prepaid, certified mail return receipt requested. Notice shall be sent to the addresses set forth below the signature blocks.
[SIGNATURES ON FOLLOWING PAGE]
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AMR
By:

Print Name: Daniel Iniguez
Title: Regional Director
Regional Director
American Medical Response
4846 Stratos Wy
Modesto, CA 95356
With Mandatory Copy to:

Law Department
Global Medical Response, Inc.
4400 State Hwy 121, Suite 100
Lewisville, TX 75056

FIRST RESPONDER
By:

Print Name: Kevin Wise
Title: Fire Chief
Fire Chief
Modesto Fire Department
409 12th St.

Modesto, CA 95354
With Mandatory Copies to:

Jose M. Sanchez
City of Modesto
City Attorney’s Office
PO Box 642
Modesto, CA 95353
and
Diane Nayares-Perez
City of Modesto
City Clerk’s Office
PO Box 642
Modesto, CA 95353
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SCHEDULE “A”
I. Services:

First Responder shall provide first response services at the ALS, EMT or EMR level as set forth in the table below to every emergency call dispatched through a Public Safety Answering Point to a call location within the Service Area defined below. First Responder personnel may accompany AMR personnel during transport if the care of the Patient and circumstances warrant based upon SCEMSA protocols. First Responder shall provide the following services:
(a) Assess all patients and begin treatments according to protocol; (b) Reduce incoming ALS ambulance to Code 2, if patient condition warrants; (c) Complete an ePCR on all medical responses, paramedic intercepts or for EMR agencies complete NFIRS;

1. Notwithstanding, ePCR’s are only required when First Responder arrives on scene first, and establishes patient care prior to AMR’s arrival. AMR shall provide the ePCR software or reimburse the First Responder at the equivalent cost.

2. All paramedic intercept ePCRs should be completed within three (3) days after the transport is completed.
(d) Participate in SCEMSA quality improvement program; and (e) Paramedic intercept services in which a First Responder firefighter rides in an on AMR BLS ambulance and performs an appropriate ALS intervention in accordance with SCEMSA protocols
II. Service Area:

Services shall be provided within Zones 1, 3, 8, “B”, “C”, and its service areas (including those in which it provides contracted services).

III. Commencement Date
The Commencement Date referred to in Section 3 of this Agreement shall be: January 1, 2025.

IV. Response Times, Response Time Standards and Per Call Assessments #17..
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Call Type Fire First
Responder
Agreement
Ambulance with
Fire First
Responder
Agreement
Ambulance without
Fire Agreement
Urban Response to 90 percent of calls each month
Code 3 7:00 11:59 (ALS) 7:59
9:59 (EMT)
8:59 (EMR)
Code 2 N/A 15:59 15:59
Suburban Response to 90 percent of calls each month
Code 3 11:00 15:59 (ALS) 11:59
13:59 (EMT)
12:59 (EMR)
Code 2 N/A 19:59 19:59
Rural Response to 90 percent of calls each month
Code 3 19:00 23:59 (ALS) 19:59
21:59 (EMT)
20:59 (EMR)
Code 2 N/A 25:59 25:59
Wilderness (Audit each call)
Code 3 ASAP ASAP ASAP
Code 2 ASAP ASAP ASAP
Response time for Services will be measured from the time the dispatch is received by the First Responder with all information necessary to respond to the call until the time the First Responder arrives on-scene (or in the case of a location other than the actual scene, the staging area or nearest accessible point, e.g., fence, apartment complex parking lot) or the call is cancelled (“Response Time”).
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https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202120220AB481

CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

May 6, 2025
Date: April 15, 2025
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: Brandon Gillespie, Chief of Police
SUBJECT: Annual Military Equipment Report per CA Assembly Bill No. 481 CONTACT: Joseph Bottoms, Lieutenant, [email protected], 209-572-9500 DESCRIPTION:

Consider accepting the Modesto Police Department’s annual Military Equipment report, approving an Ordinance re-authorizing the department’s Military Equipment Use Policy (Policy 710) and authorizing the purchasing additional equipment that qualifies as “military equipment” in Fiscal Year 2025-2026. (Funding Source: General Fund, Supplemental Law Enforcement Services Fund, Asset Forfeiture Funds, and/or Police Grant Funds) STRATEGIC PLAN ELEMENT:

The recommended action supports the City’s (2020-2025) Strategic Plan Initiative of improving community safety and promoting trust and transparency with the citizens of Modesto.

BACKGROUND:

On May 14, 2024, by Ordinance No. 3782-C.S., Council approved the Modesto Police Department’s (MPD) Military Equipment Use Policy (MPD Policy 710) per Assembly Bill 481 (AB481).1 Policy 710 requires the Modesto Police Department to submit an annual military equipment report to the City Council. The Modesto Police Department is submitting the annual military equipment report for review to ensure compliance with the Policy and requests City Council consideration to renew the ordinance as required by AB481.

Per AB481, Ordinance No. 3782-C.S., is subject to City Council review annually to determine the standards set forth in the ordinance have been met, based on an annual military equipment report. The City Council may renew the ordinance, disapprove authorization for particular military equipment where standards have not been met, or require modifications to the military equipment use policy to address any non-compliance with standards. Finally, AB481 requires publication of the military equipment use policy and the annual military equipment report on the Department’s website.
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Annual Military Equipment Report per CA Assembly Bill No. 481

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Within 30 days of submitting and publicly releasing an annual military equipment report pursuant to AB481, the law enforcement agency shall hold at least one well-publicized and conveniently located community engagement meeting, at which the public may discuss and ask questions regarding the annual military equipment report and the law enforcement agency’s funding, acquisition, or use of military equipment. The meeting was held on April 29, 2025, from 5 p.m.- 7 p.m. at the Modesto Police Department located at 600 10th Street, Modesto. The meeting was also streamed live on the Modesto Police Department’s Facebook account.

In addition to maintaining the highest levels of public safety, the Modesto Police Department is committed to transparency, public trust, community partnerships, and compliance with the law.

As such, the Modesto Police Department has authored the Attached 2025 Military Equipment Report in accordance with annual reporting requirements set forth in AB481. This report covers the usage and reporting requirements for the proceeding Calendar year (2024).

DISCUSSION:

There is significant interest in ensuring that law enforcement continues to have access to equipment that will provide peace officers with as many options as possible to safeguard lives, ensure safety, and protect civil liberties. The equipment, resources, and training outlined in the report allow Modesto Police Officers to better protect our community, enhance the safety of the public and officers, and bring critical incidents to a safe resolution.

The Modesto Police Department seeks renewal of the ordinance authorizing MPD’s Military Equipment Use Policy (Policy 710), as per CA Assembly Bil No. 481.This annual report outlines each item identified in Government Code section 70702, that is currently owned by MPD and the City of Modesto.

Staff have reviewed the equipment needs for the Police Department and determined there is a need to purchase additional items that fall under the Military Equipment Use Policy. These items are outlined in the Fiscal Impact section below and are listed in greater detail in Attachment B – Request to Purchase Equipment.

FISCAL IMPACT:

As noted above, the Department has determined there is a need to purchase items in the coming year that fall under the Military Use Policy and Ordinance No. 3782-C.S. The chart below outlines the items, the categories under which they fall, and the estimated cost. If approved, items not already part of the Police Department’s Fiscal Year (FY) FY 25/26 operating budgets will be expended from the appropriate funding source that includes Asset Forfeiture, SLESF funds (Supplemental Law Enforcement Services Fund), and/or Police Grant Funds.

Category Item Name Purpose Qty. Estimated
Cost
Category 1:

Unmanned
Aerial Vehicles
(UAV)
DJI Mavic 3T –
replaces current
mid-size UAVs that
are "end of life"
2 $13,600
DJI Avata 2 –is a
quick response
UAVs are deployed when
their use would assist
officers or Incident
Commanders with the
following situations: major
collision investigations,
3 $4,800
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Annual Military Equipment Report per CA Assembly Bill No. 481

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UAV that can get
into places
traditional UAVs
cannot
search for missing
persons, search and
rescue operations, crowd
control situations,
perimeter
searches/security, nature
disaster management,
crime scene
investigations/photography,
life preservation missions,
requests from partner
agencies, etc.

Robots 4-sight 2.0 Rover
Unit with lighting kit
and RC Motion 3
Controller
These robots are used to
gain visual/audio data in
dangerous incidents,
deliver communication
devices during high risk
incidents. They can be
used to open doors, disrupt
packages and safely clear
buildings.
2 $8,000
Category 2:

Armored
Vehicles
2025 LenCo
Bearcat
Armored vehicles are to be
used in response to Critical
Incidents to enhance
officer and community
safety, improve scene
containment and
stabilization and assist in
resolving critical incidents.
1 $400,000
Category 12:

Flash Bangs,
Tear Gas,
Pepper Balls
7290 Mini
Flashbang – need
to restock current
stock
For use during SWAT
missions and training.

Flashbangs are a
distraction device used to
distract dangerous subjects
during hostage rescues,
room entries and other
high-risk situations
48 $2,160
5230 CTS CS Gas
Canister – need to
replenish stock
For use during SWAT
missions and training.

Flashbangs are a
distraction device used to
distract dangerous subjects
during hostage rescues,
room entries and other
high-risk situations
40 $2,400
5230B CTS
Canister – needed
to replenish current
For use during SWAT
missions and training.

Designed to limit the
40 $1,600
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Annual Military Equipment Report per CA Assembly Bill No. 481

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stock escalation of conflict and
improve officer safety in
high-risk situations.
5210 CTS White
Smoke Canister –
needed to
replenish current
stock
For use during SWAT
missions and training.

Large diameter canisters
that discharge a volume of
smoke through multiple
emission ports. Can be
thrown or deployed farther
with a launching delivery
system.
45 $1,800
4330 CTS 40mm
CS Liquid
Barricade Ferret
rounds
For use during SWAT
missions and training.

Flashbangs are a
distraction device used to
distract dangerous subjects
during hostage rescues,
room entries and other
high-risk situations
100 $2,500
Category 14:

Projectile
Launch
Munitions and
Platforms
4557 CTS 40MM
Foam Baton (a.k.a.
beanbag shotgun)
– needed to
replenish current
stock from use
during Mobile Field
Force, SWAT
mission, and
training.

Less lethal munitions
designed to limit the
escalation of conflict.
100 $2,500
CTS 12GA Super
Stock Bean Bag
2581 – needed to
replenish current
stock and
conversion of
department
shotguns into less
lethal bean bag
shotguns
For use during Mobile Field
Force, patrol operations,
SWAT missions, and
training.
750 $5,250
CTS #6340 OC
Aerosol Canisters
Deliver an invisible OC
(Chemical Irritant) and
render temporary
respiratory effect on noncompliant subjects.
10 $450
Safariland #6064
40 MM Rubber
Baton – needed to
replenish current
For use during Mobile Field
Force, patrol operations,
SWAT missions, and
training.
15 $450
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stock
CTS 40 MM Aerial
Warning Signal
Flashbang #4090 –
needed to
replenish current
stock
For use during Mobile Field
Force, patrol operations,
SWAT missions, and
training.
20 $800
Remington 870
Less Lethal
Shotguns – used to
deploy the Less
Lethal Super-Sock
Impact rounds
For use during Mobile Field
Force, patrol operations,
SWAT missions, and
training.
20 $12,000
Estimated
Total
$458,310
COMMITTEE RECOMMENDATION:

This item was presented to Safety and Communities Committee on April 14, 2025, and the Committee recommended forwarding the item to the City Council for approval.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Motion introducing and waiving the first reading of an Ordinance approving the Modesto Police Department’s Military Equipment Use Policy (Policy 710) in accordance with CA Assembly Bill 481, and approving the purchase of additional equipment that qualifies as “military equipment” in Fiscal Year 2025-2026 and rescinding Ordinance No. 3782-C.S.

Motion accepting the Modesto Police Department’s annual Military Equipment Report.

Approved by:

Brandon Gillespie, Chief of Police
Joseph P. Lopez, City Manager
Attachments:

1. Ordinance

2. 2025 Military Equipment Use Report

3. MPD Policy 710 – Military Equipment Use

4. Attachment A – Policy 710 – Military Equipment Inventory

5. Attachment B – Equipment Requested to Purchase
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1 ORDINANCE NO. ________
ORDINANCE APPROVING THE MODESTO POLICE DEPARTMENT’S MILITARY EQUIPMENT USE POLICY (POLICY 710) IN ACCORDANCE WITH CA ASSEMBLY BILL 481, AND APPROVING THE PURCHASE OF ADDITIONAL EQUIPMENT THAT QUALIFIES AS “MILITARY EQUIPMENT” IN FISCAL YEAR 2025-2026 AND RESCINDING ORDINANCE NO. 3782-C.S.

WHEREAS, the Modesto Police Department is committed to using the most up-to-date tools and equipment to safeguard the residents of Modesto; and WHEREAS, Assembly Bill 481 (AB 481), codified at Government Code sections 7070 through 7075 requires a law enforcement agency to obtain approval from the applicable governing body, via adoption of a “military equipment” use policy by ordinance, prior to funding, acquiring, or using military equipment; and
WHEREAS, items deemed to be “military equipment” by AB 481 are used as a component of overall best practices for law enforcement agencies (LEAs) throughout the country; and WHEREAS, the term “military equipment”, as used in AB 481, in fact does not necessarily indicate equipment that has been used by the military; and WHEREAS, pursuant to AB 481, items deemed to be “military equipment” include, but are not limited to, unmanned aerial or ground vehicles, armored vehicles, command and control vehicles, pepper balls, less lethal shotguns, less lethal 40mm projectile launchers, and flashbangs; and
WHEREAS, these items provide peace officers with the ability to safely resolve volatile situations which otherwise might rise to the level of a lethal force encounter; and WHEREAS, this policy outlines each item identified in Government Code section 7070, that is currently owned by MPD and the City of Modesto and also includes the current use and cost of each item; and
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2 WHEREAS, these particular items have been in place prior to the implementation of AB 481 and any future acquisitions of any item deemed to be “military equipment” will require policy update and Council approval; and
WHEREAS, the Modesto City Council approved Ordinance No. 3782-C.S. on May 14, 2024 approving the MPD Military Equipment Use Policy (MPD Policy 710); and WHEREAS, the Modesto City Council has reviewed the annual military equipment report and found that each type of military equipment identified in that report has complied with the standards for approval; and
WHEREAS, MPD staff has conducted a review of the equipment needs for the department and determined that there is a need to purchase additional items that fall under the Military Equipment Use Policy and these items, their uses and cost are outlined in Attachment B; and
WHEREAS, the Modesto Police Department has held a well-publicized community engagement meeting; and
WHEREAS, AB 481 requires an annual renewal of the MPD Military Equipment Use Policy (MPD Policy 710) by ordinance, therefore staff requests Ordinance No. 3782-C.S. be rescinded with the approval of this ordinance.

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

SECTION 1. FINDINGS
The City Council of the City of Modesto finds that all of the above Recitals within this Ordinance are true and correct and incorporated herein by reference and makes the following findings:

1. The City Council hereby approves the Modesto Police Department Military Equipment Use Policy 710, attached hereto.
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3 2. The City Council finds that the purchase of the requested military equipment is necessary because there is no reasonable alternative that can achieve the same objective of officer and civilian safety; the use of the equipment under the military equipment use policy will safeguard the public’s welfare, safety, civil rights, and civil liberties; and the equipment is reasonably cost effective compared to available alternatives that can achieve the same objective of officer and civilian safety.

3. Ordinance No. 3782-C.S. is hereby rescinded.

SECTION 2. SEVERABILITY.

If any portion of this Ordinance, or its application to any person or circumstance, is for any reason held to be invalid, unenforceable or unconstitutional, by a court of competent jurisdiction, that portion shall be deemed severable, and such invalidity, unenforceability or unconstitutionality shall not affect the validity or enforceability of the remaining portions of the Ordinance, or its application any other person or circumstance. The City Council or the City of Modesto hereby declares that it would have adopted each section, sentence, clause, or phrase of this Ordinance, irrespective of the fact that any one or more other sections, sentences, clauses or phrases of this Ordinance be declared invalid, unenforceable or unconstitutional.

SECTION 3. CALIFORNIA ENVIRONMENTAL QUALITY ACT (“CEQA”) The City Council hereby finds that the adoption of this Ordinance is exempt from CEQA pursuant to CEQA Guidelines section 15061(b)(3) of the State CEQA Guidelines. Specifically, this Ordinance will not result in a direct or reasonably foreseeable indirect physical change in the environment because it does not authorize the construction of any new structures or other physical changes to the environment.

SECTION 4. EFFECTIVE DATE.

This Ordinance shall go into effect and be in full force and operation from and after thirty (30) days after its final passage and adoption.

SECTION 5. PUBLICATION.
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4 At least two (2) days prior to its final adoption, copies of this Ordinance shall be posted in at least three (3) prominent and distinct locations in the City; and a notice shall be published once in the Modesto Bee, the official newspaper of the City of Modesto, setting forth the title of this Ordinance, the date of its introduction and the places where this ordinance is posted.

The foregoing ordinance was introduced at a regular meeting of the Council of the City of Modesto held on the _6th day of May, 2025, by Council Member _________, who moved its introduction and passage to print, which motion being duly seconded by Council Member_____, was upon roll call carried and the ordinance adopted by the following vote:

AYES: Councilmembers:

NAYS: Councilmembers:

Absent: Councilmembers:

APPROVED:_________________________
SUE ZWAHLEN, Mayor
ATTEST:

BY: __________________________________
DIANE NAYARES-PEREZ, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: __________________________________
JOSE M. SANCHEZ, City Attorney
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5 FINAL ADOPTION CLAUSE
The foregoing ordinance, having been published as required by the Charter of the City of Modesto, and coming on for final consideration at the regular meeting of the Council of the City of Modesto held on the _____ day of May , 2025, Councilmember ______________moved its final adoption, which motion being duly seconded by Councilmember ________________, was upon roll call carried and the ordinance adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

APPROVED:

SUE ZWAHLEN, MAYOR
ATTEST: ____________________________
DIANE NAYARES-PEREZ, City Clerk
Effective Date: _________________, 2025
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Modesto Police Department 2025 Military Equipment Use Report 1 2025 Military Equipment
Use Report
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Modesto Police Department 2025 Military Equipment Use Report 2 Contents
Preface…………………………………………………………………………………………………………. 3
Summary of AB481………………………………………………………………………………………. 4
Introduction…………………………………………………………………………………………………. 6
Definitions……………………………………………………………………………………………………. 7
Summary of Military Equipment………………………………………………………………….. 10 Unmanned Vehicles (UAVs and Robots) ……………………………………………… 10 Armored Vehicles………………………………………………………………………………… 13
Command Post Vehicles……………………………………………………………………….. 15
Firearms……………………………………………………………………………………………….. 16
Flashbangs and Chemical Agents…………………………………………………………… 20 Projectile Launch Munitions and devices………………………………………………. 23 Equipment usage in 2024………………………………………………………………………………… 26 Purchase of Equipment……………………………………………………………………………………. 29 Complaints ……………………………………………………………………………………………………… 30
Policy violations………………………………………………………………………………………………. 30 Conclusion………………………………………………………………………………………………………. 30
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Modesto Police Department 2025 Military Equipment Use Report 3 Preface
The Modesto Police Department is committed to maintaining public safety by providing the highest quality police services to the community we serve. Our Department goal is to reduce crime and the fear of crime.

The equipment listed in this annual report are essential tools that may be required from time to time to aid in deescalating intense situations or bringing volatile conditions and critical incidents to a safe resolution. The mere possession of this equipment does not warrant its use in every circumstance. With this indispensable equipment, the brave men and women of the Modesto Police Department continue to stand ready to accomplish our mission of driving the crime rate down and improving the quality of life in the City of Modesto.
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Modesto Police Department 2025 Military Equipment Use Report 4 Summary:

On September 30, 2021, the Governor of the State of California approved AB-481 requiring law enforcement agencies to obtain approval of the applicable governing body, City Council, by adoption of a military equipment use policy. The Modesto Department was required to seek City Council approval of their military equipment use policy by ordinance at a regular open meeting prior to taking certain actions relating to the funding, acquisition, or use of military equipment, as defined. The bill allows the governing body to approve the funding, acquisition, or use of military equipment within its jurisdiction only if it determines that the military equipment meets specified standards.

The ordinance is subject to annual City Council review to determine whether, based on an annual military equipment report, the standards set forth in the approving ordinance have been met. The City Council may renew the authorizing ordinance, disapprove authorization for particular military equipment where standards have not been met, or require modifications to the military equipment use policy to address any non-compliance with standards. Finally, the bill requires publication of the military equipment use policy and the annual military equipment report on the Department’s website.

AB-481, Section 7072 states the following: (a) A law enforcement agency that receives approval for a military equipment use policy pursuant to Section 7071 shall submit to the governing body an annual military equipment report for each type of military equipment approved by the governing body within one year of approval, and annually thereafter for as long as the military equipment is available for use. The law enforcement agency shall also make each annual military equipment report required by this section publicly available on its internet website for as long as the military equipment is available for use.

Within 30 days of submitting and publicly releasing an annual military equipment report pursuant to this section, the law enforcement agency shall hold at least one wellpublicized and conveniently located community engagement meeting, at which the general public may discuss and ask questions regarding the annual military equipment report and the law enforcement agency’s funding, acquisition, or use of military equipment.
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Modesto Police Department 2025 Military Equipment Use Report 5 In addition to maintaining the highest levels of public safety, the Modesto Police Department is committed to transparency, public trust, community partnerships, and compliance with the law. As such, the Modesto Police Department has authored the following 2025 Annual Military Equipment Report in accordance with annual reporting requirements set forth in AB-481. This report covers the usage and reporting requirements for the proceeding Calendar year (2024)
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Modesto Police Department 2025 Military Equipment Use Report 6 Introduction:

The Modesto Police Department retains and employs a wide variety of defined military equipment to assist in safely achieving its mission statement of driving the crime rate down and improving the quality of life in the City of Modesto. While the inventory of military equipment is varied, the mere possession of the equipment does not warrant its use for every incident. The Modesto Police Department recognizes that critical incidents are unpredictable and can be very dynamic in nature. A variety of equipment options can greatly assist incident commanders, supervisors, officers, and specific units in bringing those incidents to a swift resolution in a safe manner.

The use of military equipment is restricted for use only in certain instances and in some cases only by certain units. While the military equipment policy is wide-ranging, it is not all inclusive. There may be instances wherein unpredictable critical incidents demand the need for incident commanders to authorize defined military equipment to be used in a manner not outlined within Department policy. In scrutinizing those particular instances, the judgment of the incident commander influenced by the totality of the circumstances, public safety, officer safety, civil rights, and information available at the time will be used.

It is incumbent upon incident commanders, supervisors, individual officers, and specific units to recognize the particular circumstances wherein military equipment should be employed to enhance the safety of the public and officers, and to bring a critical incident to a safe resolution. This Annual Military Equipment Report outlines a summary of military equipment usage guidelines, inventory, fiscal impact, and complaints for 2024. #18..
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Modesto Police Department 2025 Military Equipment Use Report 7 Definitions:

Pursuant to AB-481, the following definitions are applicable only to the Department’s current military equipment inventory and potential future military equipment acquisitions for operational needs. (For a more detailed list, refer to Government Code section 7070, for “military equipment” as defined within the Assembly Bill.) “Governing body” means the City Council and Mayor.
“Military equipment” means the following:

1. Unmanned, remotely piloted, powered aerial or ground vehicles. This definition applies to the Department’s inventory of small Unmanned Aerial Vehicles (UAVs) and SWAT robots.

2. Armored personnel carriers. However, police versions of standard consumer vehicles are specifically excluded from this definition.

3. Command and control vehicles that are either built or modified to facilitate the operational control and direction of public safety units.

4. Battering rams, slugs, and breaching apparatuses that are explosive in nature.

However, items designed to remove a lock, such as bolt cutters, or a handheld ram designed to be operated by one person, are specifically excluded from this definition.

5. Firearms of .50 caliber or greater. However, standard issue shotguns are specifically excluded from this definition.

6. Ammunition of .50 caliber or greater. However, standard issue shotgun ammunition is specifically excluded from this definition.

7. Specialized firearms and ammunition of less than .50 caliber, including assault weapons as defined in Sections 30510 and 30515 of the Penal Code, with the exception of #18..
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Modesto Police Department 2025 Military Equipment Use Report 8 standard issue service weapons and ammunition of less than .50 caliber that are issued to sworn members.

8. Any firearm or firearm accessory that is designed to launch explosive projectiles.

9. “Flashbang” devices and explosive breaching tools, “tear gas,” and “pepper balls,” excluding standard, service-issued handheld OC. This definition applies to all of the Department’s inventory of flashbangs, pepper ball launchers and related ammunition.

Additionally, this definition applies to all of the Department’s inventory of various chemical agents and chemical agent delivery systems maintained by the SWAT Unit.

10. The following projectile launch platforms and their associated munitions: 40mm projectile launchers, “bean bags,” and rubber bullets. This definition applies to all of the Department’s inventory of 40 mm projectile launchers to include 40 mm multi-launchers and bean bag shotguns and associated munitions.

11. “Military equipment” does not include general equipment not designated as prohibited or controlled by the federal Defense Logistics Agency. “Military equipment use policy” refers to the Modesto Police Department Policy 710 and means a publicly released, written document governing the use of military equipment by the Department that addresses, at a minimum, all of the following:

1. A description of each type of military equipment, the quantity sought, its capabilities, expected lifespan, and product descriptions from the manufacturer of the military equipment.

2. The purposes and authorized uses for which the Department proposes to use each type of military equipment.
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Modesto Police Department 2025 Military Equipment Use Report 9 3. The fiscal impact of each type of military equipment, including the initial costs of obtaining the equipment and estimated annual costs of maintaining the equipment.

4. The legal and procedural rules that govern each authorized use.

5. The training, including any course required by the Commission on Peace Officer Standards and Training, that must be completed before any sworn member is allowed to use each specific type of military equipment to ensure the full protection of the public’s welfare, safety, civil rights, and civil liberties and full adherence to the military equipment use policy.

6. The procedures by which members of the public may register complaints or concerns or submit questions about the use of each specific type of military equipment, and how the Department will ensure that each complaint, concern, or question receives a response in a timely manner.
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Modesto Police Department 2025 Military Equipment Use Report 10 Summary of Military Equipment:

The inventory of military equipment, particularly consumable material (ammunition, diversionary devices, etc.) fluctuates regularly. This is based on a variety of factors including but not limited to operational usage, operational deterioration, training, maintenance, and expiration and replenishment guidelines. The Modesto Department is committed to transparency in disclosing its military equipment inventory and related information to our community and elected officials in compliance with the law. The Department strives its utmost to provide the most accurate military equipment inventory and information at the time of this report’s publication.

The following are the various types, descriptions, and guidelines for usage of military equipment currently employed by Modesto Police Department:

Unmanned Aerial Vehicles (UAV): An unmanned aircraft along with the associated Equipment necessary to control it remotely.
a. Description, quantity, capabilities and purchase cost of current UAVS.

1. DJI 200 V2 with Zenmuse XT2 Thermal Camera, Cost: $15,0000 Quantity: 1 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

2. DJI 200 V1 with Zenmuse Z30 Zoom Camera, Cost: $16,0000 Quantity: 1 Remotely operated aerial vehicle that has video recording capabilities and 27 minutes of flight time

3. DJI Mavic2 Thermal, Cost: $1,000 Quantity: 2 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time
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Modesto Police Department 2025 Military Equipment Use Report 11 4. DJI Phantom 4 with Zenmuse XT Thermal Camera and Z3 Zoom Camera, Cost:
$2,500 Quantity: 4 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

5. DJI Mavic 3T, Cost: $5,500 Quantity: 4 Remotely operated aerial vehicle that has video recording and thermal imaging capabilities 25-30 minutes of flight time.

6. DJI Mavic Platinum, Cost: $6,500 Quantity: 1 Remotely operated aerial vehicle that has built in video recording and Thermal imaging capabilities. This UAV is issued to Modesto FD for search and rescue missions

7. DJI Mavic1, Cost: $1,000 Quantity: 2 Remotely operated aerial vehicles that have video recording and 15-20 minutes of flight time

8. DJI Mavic2, Cost: $1,000 Quantity:2 Remotely operated aerial vehicle that has video recording and 20-25 minutes of flight time.
b. Purpose: UAVs are to be deployed when its use would assist officers or Incident commanders (ICs)with the following situations, which include but not limited to:

1. Major collision investigations

2. Search for missing persons

3. Search and rescue operations

4. Crowd control Situations

5. Perimeter Searches and security

6. Natural disaster management

7. Crime Scene Investigations and photography

8. SWAT, tactical, or other public safety and life preservation missions

9. In response to specific requests from local, state, or federal fire authorities for fire response and/or prevention.
c. Authorized use: Only authorized operators as set forth in Department Policy 613 shall be permitted to operate any UAV and only during approved missions. d. Expected life span: All UAV equipment 1-3 years
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Modesto Police Department 2025 Military Equipment Use Report 12 e. Fiscal impact: Annual maintenance and battery replacement cost is projected to be approximately $5,000
f. Training: All UAV operators must go thru in-service training on UAV systems and operations as well as search and seizure laws as well as ongoing in-service training quarterly.
g. Legal procedure rules: Use is established under Department Policy 613 and in accordance with MPD’s FAA Certificate of Authorization. It is the policy of the Modesto Police Department (MPD) to utilize UAVS only for official law enforcement purposes and in a manner that respects the privacy of our community, Constitutional rights and in a manner pursuant to state and federal law.

Robots: A remotely controlled unmanned ground vehicle, which is used to enhance the safety of officers and the community.
a. Description, quantity, capabilities and purchase cost of current robots.

1. Robotex A00476 Quantity:1 Cost: $20,000 The Robotex Tactical robot enhances the capabilities of SWAT and tactical response teams by allowing them to quickly and safely inspect dangerous situations. There is no longer a need to send personnel in before there has been a chance to assess the situation. The robot can navigate various terrain including stairs, grass and clothing. It has two-way audio and video recording capabilities and is remotely operated.

2. iRobot BB2590 Quantity:1 Cost: $0 obtained from Government surplus program (LESO). This robot is a multi-mission Tactical robot used to carry out dangerous missions in high threat incidents and is remotely operated. #18..
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Modesto Police Department 2025 Military Equipment Use Report 13 b. Purpose: These robots are used to gain visual /audio data in dangerous incidents, deliver communication devices during high risk incidents. They can be used to open doors, disrupt packages and safely clear buildings.
c. Authorized use: The use of robots shall only be authorized by a designated Incident Commander or the SWAT Commander, based on the specific circumstances of a given critical incident. Robots shall only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: All unmanned ground vehicles, 5-10 years e. Fiscal impact: Annual maintenance costs and battery replacement costs are projected to be approximately $4,000
f. Training: All operators will be trained with in-service SWAT training on unmanned ground vehicle operations.
g. Legal procedure rules: Use is established under Department Policy 414 (Hostage or barricaded persons) and policy 409 (Crisis Response Unit). It is the policy of the Modesto Police Department (MPD) to utilize unmanned ground vehicles (Robots) only for official law enforcement purposes and in a manner that respects the privacy of our community, pursuant to state and federal law.

Armored vehicles: Commercially produced wheeled Armored Personnel vehicles utilized for law enforcement purposes.
a. Description, quantity, capabilities and purchase cost of current armored vehicles.

1. 2004 LenCo Bear cost: $300,000. The LenCo Bear is an armored vehicle that seats 10-12 personnel with an open floor plan that allows for rescue of downed personnel. The vehicle has ballistic capabilities which provide greater safety to citizens and officers beyond the protection level of Ballistic shields or personal body armor.
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Modesto Police Department 2025 Military Equipment Use Report 14 2. Peacekeeper Protected Response Vehicle (PRV). Quantity:2 Cost: $0. Both vehicles obtained from Government surplus program (LESO). The primary use of these two vehicles are to act as overt surveillance stations (Armadillo Program) in areas experiencing quality of life issues or high crimes. The video camera equipment can capture criminal activity as well as help identify those involved in crime. In emergency situations Peacekeeper vehicles can seat 6-10 people. The vehicle has ballistic capabilities which provide greater safety to citizens and officers beyond the protection level of Ballistic shields or personal body armor.
b. Purpose: Armored vehicles are to be used in response to Critical Incidents to enhance officer and community safety, improve scene containment and stabilization and assist in resolving critical incidents c. Authorized use: The use of Armored vehicles shall only be authorized by a Watch Commander, a designated Incident Commander or the SWAT Commander, based on the specific circumstances of a given critical incident. Armored vehicles shall only be used by officers trained in their deployment and in a manner consistent with department policy and training.
d. Expected life span: All Armored vehicles, 20 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $25,000
f. Training: All drivers/operators will be trained with in-service training on vehicle operations and practical driving instruction.
g. Legal procedure rules: Use is established under Department Policy 706 (vehicle use) and policy 707 (Armored vehicles). It is the policy of the Modesto Police Department (MPD) to utilize armored vehicles only for official law enforcement purposes and in a manner pursuant to state and federal law. #18..
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Modesto Police Department 2025 Military Equipment Use Report 15 Mobile Incident Command Post vehicles (Mobile CP): Truck and trailer used for a mobile office command Center that provides shelter, access to department computer and communication systems and restroom facilities during extended events. a. Description, quantity, capabilities and purchase cost of current CP vehicles.

1. 2000 Eagle 5th wheel trailer Cost: $40,000 This trailer is used for a mobile office command Center by both the Modesto Police and Fire Departments that provides shelter, access to department computer and communication systems and restroom facilities during extended events. This vehicle is marked with the words, Modesto Police Department Command Post and is separated into three areas. The areas include a conference area with white boards and tables, a communications area with radios and computer capabilities and a private interviewing area.

2. 2001 Ford F550 truck Cost: $42,159 This Vehicle is used to pull the 5th wheel trailer Mobile command post. And is marked with “Modesto Police” and has emergency lighting.
b. Purpose: To be used based on the specific circumstances of a given critical incident, large event, natural disaster, community event or for crime scene management. c. Authorized use: The use of the command post vehicles shall only be authorized by a Watch Commander, a designated Incident Commander, SWAT Commander or Crisis Response Unit (CRU) Commander, based on the specific circumstances of a given critical incident. Command Post vehicles shall only be used by officers trained in their deployment and in a manner consistent with department policy and training.
d. Expected life span: vehicles, 20 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $10,000 #18..
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Modesto Police Department 2025 Military Equipment Use Report 16 f. Training: All drivers/operators will be trained with in-service training on vehicle operations and practical driving instruction and must be properly licensed through the State of California
g. Legal procedure rules: Use is established under Department Policy 706 (vehicle use) and policy408 (Crisis Response Unit). It is the policy of the Modesto Police Department (MPD) to utilize the mobile command post vehicles only for official law enforcement purposes and in a manner pursuant to state law regarding the operation of motor vehicles.

Rifles: The Modesto Police Department issues rifles to select officers for duty use. These rifles are issued as the firearm for officers selected as Urban Rifle Operators (URO) or as a member of SWAT. The M16A1 rifles are used for training purposes only. These rifles are outfitted with upper receivers that are not capable of firing live projectiles. a. Description, quantity, capabilities and purchase cost:

1. M16A1select fire rifles. Cost: $0, Quantity:21 These rifles were obtained over 20 years ago through the military Surplus program (LESO). These rifles are only used for training. When used for training the rifles are outfitted with upper receivers that are not capable of firing live projectiles. (31) rifles were returned to the federal government as they were no longer being used for training.
b. Purpose: These rifles are for training purposes ONLY by SWAT team members and designated personnel of the Urban Rifle team (URO). These rifles are not used outside of a training environment.
c. Authorized use: These rifles are for training purposes by SWAT team members and designated personnel of the Urban Rifle team (URO). These rifles are not used outside of a training environment.
d. Expected life span: 40 years
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Modesto Police Department 2025 Military Equipment Use Report 17 e. Fiscal impact: Annual maintenance costs are projected to be approximately $500 f. Training: Personnel using these for training have either attended MPD’s POST certified 40-hour Urban Rifle course, the POST Certified 16-hour patrol rifle course or the POST certified SWAT Basic course.
g. Legal procedure rules: Use is established under Department policy 312 (Firearms).

It is the policy of the Modesto Police Department (MPD) to utilize training rifles only for official law enforcement purposes and in a manner pursuant to state and federal law.
a. Description, quantity, capabilities and purchase cost:

1. URO Program- Colt AR-15 (32), Colt M4 (52), Daniel Defense DD4R3 (50) rifles Cost: $157,000, Quantity:134
b. Purpose: These rifles are assigned to patrol officers and other sworn personnel as standard issued duty equipment.
c. Authorized use: Only selected officers who have attended the POST approved Patrol Rifle course will be issued a department patrol rifle. d. Expected life span: 10-15 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $10,000
f. Training: Personnel issued and using these rifles have either attended MPD’s POST certified Patrol Rifle course, or the POST certified SWAT Basic course. h. Legal procedure rules: Use is established under Department policy 312 (Firearms).

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Modesto Police Department 2025 Military Equipment Use Report 18 for official law enforcement purposes and in a manner pursuant to state and federal law.
a. Description, quantity, capabilities and purchase cost:

1. SWAT designated firearms- Colt M4 (14), HK MP5 (6), Daniel Defense DD4R3S (24) Cost: $65,000, Quantity:44
b. Purpose: These firearms are issued to and used ONLY by SWAT team members. c. Authorized use: Only SWAT officers who have attended the POST certified SWAT Basic course will be issued a department SWAT designated firearm. d. Expected life span: 10-15 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $5,000 f. Training: Personnel issued and using these firearms have attended the POST certified SWAT Basic course. The SWAT team officers also train multiple times per month.
g. Legal procedure rules: Use is established under Department policy 312 (Firearms).

It is the policy of the Modesto Police Department (MPD) to utilize rifles only for official law enforcement purposes and in a manner pursuant to state and federal law.
a. Description, quantity, capabilities and purchase cost:

1. SWAT Sniper team rifles- BCM .223(1), DPMS 308 (2), Remington 700 308 (2) rifles Cost: $5,000, Quantity:5
b. Purpose: These rifles are issued and used ONLY by SWAT team members who have been selected to the SWAT Sniper Team.
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Modesto Police Department 2025 Military Equipment Use Report 19 c. Authorized use: only officers assigned to the SWAT Sniper team will be authorized to use these firearms.
d. Expected life span: 10-15 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $1,000 f. Training: Personnel issued and using these rifles have attended the POST certified SWAT Basic course. Sniper team members also train monthly as a unit. g. Legal procedure rules: Use is established under Department policy 312 (Firearms).

1. SWAT Historical firearms- Uzi 9mm (5) firearms Cost: $6,000, Quantity:5 b. Purpose: These firearms are not issued or used. They are for display purposes only for historical purposes.
c. Authorized use: There is no authorized use as these are for display purposes only. d. Expected life span: 20 years
e. Fiscal impact: There are no annual maintenance costs. f. Training: These firearms are for display purposes only #18..
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Modesto Police Department 2025 Military Equipment Use Report 20 g. Legal procedure rules: Use is established under Department policy 312 (Firearms).

It is the policy of the Modesto Police Department (MPD) to utilize all firearms only for official law enforcement purposes and in a manner pursuant to state and federal law.

Flash Bangs, Tear Gas, pepper balls: Flashbangs are devices used to distract and disorientate dangerous persons. Chemical Agent (tear gas) Canisters contain chemical agents that are released when deployed. Pepper balls are non-lethal projectiles that contain a chemical irritant
a. Description, quantity, capabilities and purchase cost.

1. Pepper ball FTC Launchers. Cost: $600 each, Quantity: 5, these launchers are compressed-air powered launchers designed to fire non-lethal Pepper ball projectiles which contain a chemical irritant.

2. Pepper ball Tippman Carbine Launchers. Cost: $200 each, Quantity: 2, these launchers are compressed-air powered launchers designed to fire non-lethal Pepper ball projectiles which contain a chemical irritant.

3. Pepper ball LIVE projectile, Cost: $2 per projectile Quantity: 2000. The basic pepper ball projectile contains 2% PAVA pepper powder and are designed for direct impact and area saturation, especially in confined interior spaces. the projectile is a non-lethal chemical irritant.

4. Combined Tactical Systems (CTS) 7290 Mini Flashbang, Cost: $40 each, Quantity: 43 These are non-bursting, non-fragmenting devices that produce a thunderous bang with intense bright light. They are ideal for distracting dangerous subjects in high risk situations.

5. Combined Tactical Systems (CTS)5230 CS Gas Canister Cost: $50 each, Quantity: 25, Large diameter canisters that discharge a high volume of #18..
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Modesto Police Department 2025 Military Equipment Use Report 21 smoke and chemical agent through multiple emission ports. Can be thrown or deployed with a launching delivery system.

6. Combined Tactical Systems (CTS)5230B CS Gas Canister Cost: $50 each, Quantity: 30, Large diameter canisters that discharge smoke and chemical agent through multiple emission ports. Can be thrown or deployed with a launching delivery system.

7. Combined Tactical Systems (CTS)4330 40mm CS Liquid Barricade Ferret rounds. Cost: $25Each, Quantity: 70, These rounds are CS filled projectiles that are used to penetrate intermediate barriers and deliver irritant agents into adjacent rooms. They are used to dislodge barricaded subjects from confined spaces. The purpose is to minimize risks to all persons through pain compliance, temporary discomfort and/or incapacitation of potentially violent or dangerous persons.

8. Defense Technology 40mm warning/signaling munition #6029WS Cost $45 each, Quantity:11. These are 40mm launched warning/signaling munitions that deliver 170 dB of sound and bright light

9. CTS 40 MM Aerial Warning Signal Flashbang #4090, Cost: $40 each Quantity: 3 These are 40mm launched warning/signaling munitions that deliver intense sound and bright light and are fired above a crowd during a riot/Civil disorder situation.

10.CTS #4233 40 mm Riot CS Smoke canisters Cost: $45 each Quantity: 20 These are 40mm launched CS smoke munitions that emit CS Chemical irritant and smoke during a riot/Civil disorder situation.

11.CTS #6210 Smoke Canister Cost: $35 each, Quantity:15 These smoke canisters are used for obstructing tactical movement and for signaling and marking a landing zone during any air operations. These are thrown manually
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Modesto Police Department 2025 Military Equipment Use Report 22 12.CTS #6340 OC Aerosol Canisters Cost: $45 each, Quantity:14 These canisters deliver an invisible OC (Chemical irritant) and renders a Temporary respiratory effect on non-complaint subjects. These are thrown manually
b. Purpose: Flashbangs are a distraction device used to distract dangerous subjects during hostage recues, room entries or other high-risk situations. They produce atmospheric over-Pressure and brilliant white light and as a result can cause short term (6-8 seconds) sensory deprivation to give officers a tactical advantage and increase officer safety. Chemical agent canisters are designed to limit the escalation of conflict and improve officer safety in high risk situations. Situations for use of Chemical agent systems may include but are not limited to:

1. Self-Destructive, dangerous and/or combative subjects

2. Riot/crowd control and civil unrest incidents

3. Circumstances where a tactical advantage can be obtained

4. Potentially vicious animals

5. Training exercise and/or approved demonstrations
c. Authorized use: The use of the Chemical Agent munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal and chemical agent instructors. They can only be used by officers trained in their deployment and in a manner consistent with department policy and training.
d. Expected life span: Pepper ball Launchers:20 years, Pepper ball projectiles: 2 years, Flashbangs: No expiration date. Chemical Agents/Tear gas: 5 years e. Fiscal impact: There are no projected Annual maintenance costs. Supply replacement costs are projected to be $4,000
f. Training: The use of the Chemical agent munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal and chemical agent instructors. The use of flashbangs is authorized to be used by officers of the SWAT team and who are trained in their deployment by #18..
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Modesto Police Department 2025 Military Equipment Use Report 23 POST certified instructors and in a manner consistent with department policy and training.
g. Legal procedure rules: Use is established under Department Policy 300 (use of force) and policy 308 (Control devices). It is the policy of the Modesto Police Department (MPD) to utilize Chemical agents, their delivery systems and flash bangs only for official law enforcement purposes and in a manner pursuant to state and federal law.

Projectile Launch munitions and Platforms: 40mm Launchers are utilized by Department personnel as a Tear gas delivery system and as a Less lethal tool to launch impact rounds.

The Less Lethal shotguns are used to deploy the Less Lethal 12-gauge Super-Sock Beanbag Impact round.
a. Description, quantity, capabilities and purchase cost.

1. Remington 870 Less Lethal Shotgun, Cost: $600 each, Quantity: 120, The Remington 870 Less Lethal Shotgun is designated as such with High Visibility Bright Orange Stocks and Foregrips. They are used to deploy the Less Lethal Super-Sock Impact rounds up to a distance of 75 feet. The range of the weapon system helps to maintain space between officers and a suspect reducing the immediacy of the threat which is a principle of De-escalation.

All MPD owned Remington 870s were converted over to Less Lethal Shotguns by equipping them with High Visibility orange stocks

2. 12 Gauge Super-sock Bean Bag Impact round, Cost: $5 per round, Quantity:800. These rounds are a 12-gauge shotgun round firing a ballistic fiber bag filled with 40 grams of lead shot at a velocity of 290 feet per second. These are considered impact weapons and provide accurate and effective performance when fired from the approved distance of not less than 5 feet. Effectiveness depends on many variables such as distance, clothing, stature and the area the projectile impacts.
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Modesto Police Department 2025 Military Equipment Use Report 24 3. Defense technology 40mm Single shot launcher Cost: $1000 each, Quantity:
2, The 40mm Single Shot Launcher is a tactical launcher. It will fire standard 40mm Less Lethal Ammunition and gas munitions. These are only authorized to be used by SWAT personnel and specifically designated members of the Mobile Field Force (MFF).

4. LMT 40mm Single shot launcher Cost: $1000 each, Quantity: 4, The 40mm LMT Single Shot Launcher is a tactical launcher. It will fire standard 40mm Less Lethal Ammunition and gas munitions. These are only authorized to be used by SWAT personnel and specifically designated members of the Mobile Field Force (MFF).

5. CTS 40MM foam baton munition #4557 Cost $35 each, Quantity 56: These munitions are a 40mm launched, spin stabilized less lethal direct impact munition.

6. 40 MM Bean Bag Rounds Cost: $25 each, Quantity: 3, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management.

7. Safariland 40 MM Rubber Baton#6064 Cost: $25 each, Quantity: 6, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management.

8. Defense technology 40mm Stinger Rubber Ball Rounds Cost: $25 each, Quantity: 19, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management. Each round contains approx. (18) 60mm rubber balls.
b. Purpose: Less Lethal munitions are designed to limit the escalation of conflict where employment of lethal force is prohibited or undesirable. Situations for use of less lethal weapon systems may include but are not limited to:

1. Self-Destructive, dangerous and/or combative subjects

2. Riot/crowd control and civil unrest incidents

3. Circumstances where a tactical advantage can be obtained #18..
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Modesto Police Department 2025 Military Equipment Use Report 25 4. Potentially vicious animals

5. Training exercise and/or approved demonstrations
c. Authorized use: The use of the less lethal munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal instructors. They can only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: Bean bag shotguns:25-30 years, Bean bag munitions: 5 years, 40 mm launchers: 20 years
e. Fiscal impact: Annual replacement/maintenance costs are projected to be approximately $2,000
f. Training: The use of the less lethal munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal instructors during in service training.
g. Legal procedure rules: Use is established under Department Policy 300 (use of force) and policy 308 (Control devices). It is the policy of the Modesto Police Department (MPD) to utilize less lethal munitions and delivery systems only for official law enforcement purposes and in a manner pursuant to state and federal law.
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Modesto Police Department 2025 Military Equipment Use Report 26 Equipment Usage 2024:

This section outlines the military equipment usage for 2024. Certain items of military equipment, particularly consumables (munitions, diversionary devices, pepper balls, chemical agents, etc.) are used throughout the year on a regular basis for training in order to maintain proficiency. Training usage is not captured in this section. This section only provides data for the operational use of military equipment listed within this Annual Equipment Report.

MPD had (83) Operational UAV deployments (on many of the Incidents, more than one UAV was deployed to maintain overlapping coverage)
 Search Warrant/Tactical Operation Area Surveillance- 7 Incidents  Perimeter search of wanted person where suspect was found- 20 Incidents.  Perimeter search of wanted person where suspect was not found- 17 Incidents.
 Crime scene Aerial Photographing- 4 Incidents
 Calls related to Firearm use. Perimeter check -5 Incidents.  Perimeter check on Alarm activations at large buildings/Schools-10 Incidents  Area/Roof search for Evidentiary items- 10 Incidents
 Roof search for persons-4 Incidents
 Search for missing persons- 3 incidents
 Use during community events- 1 incidents.
 Assist to Modesto Fire Dept at scenes- 2 incidents.

There were (17) deployments of the Lenco armored vehicle. (11) deployments were for SWAT tactical operations (see information on SWAT deployments on page 28).

The other (6) deployments were for a High-Risk Incident where the incident was resolved without a SWAT activation as follows:
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Modesto Police Department 2025 Military Equipment Use Report 27 1. A call for service reporting a male was holding a gun at a complex. The armored vehicle was used to check the complex and the call was unfounded.

2. Modesto Police received information that an individual was at a business with a firearm concealed. The armored vehicle was utilized during the service of a search warrant when individuals refused to exit. Subjects were taken into custody.

3. The armored vehicle was used to assist the Stanislaus Sheriff’s Office for the report of an armed individual. The armored vehicle was used to assist in their investigation.

4. The armored vehicle was used to assist the Stanislaus Sheriff’s Office for the report of an armed individual. The armored vehicle was used to assist in their investigation.

5. A call for service of an armed subject making threats to family prompted the armored vehicle to be used. Subject surrendered and was taken into custody.

6. The armored vehicle was used to assist with the report of an armed individual making threats. The subject surrendered and was detained.  There were (15) deployments of the Peacekeeper armored vehicles. The deployments were for use in the “Armadillo” Program as described above on page 14.
 There were (10) deployments of the Command Post vehicles. The deployments were for SWAT tactical operations. (Incidents #1 - #10)  There were (1) deployments of Flashbang devices by SWAT officers. The deployments were for SWAT tactical operations. (Incident #2)  There were (2) deployments of less lethal beanbag munitions. The munitions were deployed from Remington Bean Bag guns and were used as described below:
 (13) rounds used on a wanted violent suspect who was armed with a knife. The deployment caused the subject to drop the weapon and was later taken into custody after a K9
apprehension.
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Modesto Police Department 2025 Military Equipment Use Report 28  (2) round used on a suspect who was violently assaulting another person. The deployment caused the subject to surrender and be taken into custody.
 There was (1) deployment of Pepper ball munitions. The munitions were deployed from listed Pepper ball launchers and were used as described below:
 Used on a subject wanted for domestic violence court order violation who refused to come down from the roof of a
residence.

SWAT Tactical Operations- The below information is summaries of SWAT deployments where listed equipment was used:

1. Search Warrant service- Assist to ATF related to a firearm trafficking investigation

2. Search Warrant service- Search warrant service for a subject wanted for murder

3. Search Warrant service- Search warrants service for a subject wanted for assault with a deadly weapon and attempted murder

4. Search Warrant service- Search warrant service for a subject wanted for felony weapons violations

5. Search Warrant service- Search warrant service for a subject wanted for felony weapons violations

6. Search Warrant service- Search warrant service for subjects wanted in an illegal narcotics cultivations / sales investigation

7. Search Warrant service- Search warrant service for a subjects involved in an assault with a firearm

8. Search Warrant service- Search warrant service for a subject wanted for murder.

9. Search Warrant service- Search warrant service for a subjects involved in an assault with a firearm

10.Search Warrant service- Assist to ATF related to a robbery investigation #18..
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Modesto Police Department 2025 Military Equipment Use Report 29 Purchase of Equipment in 2024:
 (24) Daniel Defense DD4 R3S Rifles were purchased. These rifles are chambered in .223 and are for S.W.A.T. Operators.
 (50) Daniel Defense DD4 R3 Rifles were purchased. There rifles are chambered in .223 and are for other police personnel, to include Patrol and other Special Assignments.
 (500) Super-Sock Bean Bag Impact Rounds were purchased. These rounds are a 12- gauge shotgun round firing a ballistic fiber bag filled with 40 grams of lead shot at a velocity of 290 feet per second.
 (2) DJI Mavic 3T UAV’s were purchased. These are remotely operated aerial vehicles that has video recording and thermal imaging capabilities 25-30 minutes of flight time.
 (2) DJI Avata 2’s UAVs were purchased. These are remotely operated aerial vehicles that has video recording and 15-20 minutes of flight time.  Although the department’s rifles do not meet the statutory reporting requirements of AB481 due to being “standard issue”, they are now being reported in order for the department to be as transparent as possible. #18..
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Modesto Police Department 2025 Military Equipment Use Report 30 Complaints regarding use of Military Equipment:

In some instances, the application and use of military equipment may cause questions and/or concerns for members of the community. It is vitally important that community members’ questions regarding the application and use of military equipment are addressed. The Modesto Police Department is committed to full and fair investigation of citizen complaints. As such, the Department has sound internal policies for thorough and impartial investigations of citizen complaints. Resolving complaints in a fair, impartial, and expeditious manner will ensure the consistent high level of integrity and efficiency maintained by the Department. The following is a summary of formal investigations related to the use of military equipment as investigated by the Modesto Police Department’s Internal Affairs Unit for 2024.
 There were no complaints/investigations regarding the use of Military Equipment in 2024.

Summary and responses to Policy 710 violations:
 No violations of Policy 710- Military Equipment use, were reported or known of in 2024.

Conclusion:

This Annual Military Equipment Report reaffirms the Modesto Police Department’s commitment to providing transparency and information to our community and elected officials in addition to ensuring compliance with the law. The equipment, resources, and training outlined in this report allow Modesto Police Officers to better protect our community, enhance the safety of the public and officers, and bring critical incidents to a safe resolution. Public safety is and always has remained a shared responsibility. The strength of our Department lies not solely within the actions of the individual officer but within the resilience and willingness of our community to work in partnership with our officers to address crime in their neighborhoods.
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Modesto Police Department
Policy 710- Military Equipment Use
Attachment A- Military Equipment Inventory
2024
(Categories correspond with the categories provided in Government Code Section 7070(c) #18..
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Category1-
Unmanned Aerial Vehicles (UAV): An unmanned aircraft along with the associated Equipment necessary to control it remotely.
a. Description, quantity, capabilities and purchase cost of current UAVS.

1. DJI 200 V2 with Zenmuse XT2 Thermal Camera, Cost: $15,000 Quantity: 1 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

2. DJI 200 V1 with Zenmuse Z30 Zoom Camera, Cost: $16,000 Quantity: 1 Remotely operated aerial vehicle that has video recording capabilities and 27 minutes of flight time

3. DJI Mavic2 Thermal, Cost: $1,000 Quantity: 2 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

4. DJI Mavic 2 Zoom, Cost: $1,000 Quantity: 2 Remotely operated aerial vehicle that has video recording and capabilities and 25-30 minutes of flight time

5. DJI Phantom 4 with Zenmuse XT Thermal Camera and Z3 Zoom Camera, Cost:
$2,500 Quantity: 4 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

6. DJI Inspire with Zenmuse XT Thermal Camera and Z3 zoom camera, Cost: $8,500 Quantity: 1 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

7. DJI Mavic Platinum, Cost: $6,500 Quantity: 1 Remotely operated aerial vehicle that has built in video recording and Thermal imaging capabilities. This UAV is issued to Modesto FD for search and rescue missions
b. Purpose: UAVs are to be deployed when its use would assist officers or Incident commanders (ICs)with the following situations, which include but not limited to:

1. Major collision investigations

2. Search for missing persons

3. Search and rescue operations

4. Crowd control Situations
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5. Perimeter Searches and security

6. Natural disaster management

7. Crime Scene Investigations and photography

8. SWAT, tactical, or other public safety and life preservation missions

d. Expected life span: All UAV equipment 1-3 years
e. Fiscal impact: Annual maintenance and battery replacement cost is projected to be approximately $5,000
f. Training: all UAV operators must go thru in-service training on UAV systems and operations as well as search and seizure laws as well as ongoing in-service training quarterly.
g. Legal procedure rules: use is established under Department Policy 613 and in accordance with MPD’s FAA Certificate of Authorization. It is the policy of the Modesto Police Department (MPD) to utilize UAVS only for official law enforcement purposes and in a manner that respects the privacy of our community, Constitutional rights and in a manner pursuant to state and federal law.

Robots: A remotely controlled unmanned ground vehicle, which is used to enhance the safety of officers and the community.

a. Description, quantity, capabilities and purchase cost of current robots.

2. iRobot BB2590 Quantity:1 Cost: $0 obtained from Government surplus program (LESO). This robot is a multi-mission Tactical robot used to carry out dangerous missions in high treat incidents and is remotely operated. b. Purpose: These robots are used to gain visual /audio data in dangerous incidents, deliver communication devices during high risk incidents. They can be used to open doors, disrupt packages and safely clear buildings.
c. Authorized use: The use of robots shall only be authorized by a designated Incident Commander or the SWAT Commander, based on the specific circumstances of a given critical incident. Robots shall only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: All unmanned ground vehicles, 5-10 years e. Fiscal impact: Annual maintenance costs and battery replacement costs are projected to be approximately $3,000
f. Training: all operators will be trained with in-service SWAT training on unmanned ground vehicle operations.
g. Legal procedure rules: use is established under Department Policy 414 (Hostage or barricaded persons) and policy 409 (Crisis Response Unit). It is the policy of the Modesto Police Department (MPD) to utilize unmanned ground vehicles (Robots) only for official law enforcement purposes and in a manner that respects the privacy of our community, pursuant to state and federal law.

Category 2-
Armored vehicles: Commercially produced wheeled Armored Personnel vehicles utilized for law enforcement purposes.
a. Description, quantity, capabilities and purchase cost of current armored vehicles.

2. Peacekeeper Protected Response Vehicle (PRV). Quantity:2 Cost: $0. Both vehicles obtained from Government surplus program (LESO). The primary use of these two vehicles are to act as overt surveillance stations (Armadillo Program) in areas experiencing quality of life issues or high crimes. The video camera equipment can capture criminal activity as well as help identify those involved in crime. In emergency situations Peacekeeper vehicles can seat 6- 10 people. The vehicle has ballistic capabilities which provide greater safety to citizens and officers beyond the protection level of Ballistic shields or personal body armor.

B. Purpose: Armored vehicles are to be used in response to Critical Incidents to enhance officer and community safety, improve scene containment and stabilization and assist in resolving critical incidents C. Authorized use: The use of Armored vehicles shall only be authorized by a Watch Commander, a designated Incident Commander or the SWAT Commander, based on the specific circumstances of a given critical incident.

Armored vehicles shall only be used by officers trained in their deployment and in a manner consistent with department policy and training.

D. Expected life span: All Armored vehicles, 20 years
E. Fiscal impact: Annual maintenance costs are projected to be approximately $20,000
F. Training: all drivers/operators will be trained with in-service training on vehicle operations and practical driving instruction.

G. Legal procedure rules: use is established under Department Policy 706 (vehicle use) and policy 707 (Armored vehicles). It is the policy of the Modesto Police Department (MPD) to utilize armored vehicles only for official law enforcement purposes and in a manner pursuant to state and federal law.

Category 3- None
Category 4-None
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Category 5-
Mobile Incident Command Post vehicles (Mobile CP): Truck and trailer used for a mobile office command Center that provides shelter, access to department computer and communication systems and restroom facilities during extended events. a. Description, quantity, capabilities and purchase cost of current CP vehicles.

2. 2001 Ford F550 truck Cost: $42,159 This Vehicle is used to pull the 5th wheel trailer Mobile command post. And is marked with “Modesto Police” and has emergency lighting.
b. Purpose: To be used based on the specific circumstances of a given critical incident, large event, natural disaster, community event or for crime scene management. c. Authorized use: The use of the command post vehicles shall only be authorized by a Watch Commander, a designated Incident Commander, SWAT Commander or Crisis Response Unit (CRU) Commander, based on the specific circumstances of a given critical incident. Command Post vehicles shall only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: vehicles, 20 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $10,000 f. Training: all drivers/operators will be trained with in-service training on vehicle operations and practical driving instruction and must be properly licensed through the State of California
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g. Legal procedure rules: use is established under Department Policy 706 (vehicle use) and policy408 (Crisis Response Unit). It is the policy of the Modesto Police Department (MPD) to utilize the mobile command post vehicles only for official law enforcement purposes and in a manner pursuant to state law regarding the operation of motor vehicles.

Category 6- None
Category 7-None
Category 8- None
Category 9-
Rifles:

1. M16A1select fire rifles. Cost: $0, Quantity:21 These rifles were obtained over 20 years ago through the military Surplus program (LESO). These rifles are only used for training.

When used for training the rifles are outfitted with upper receivers that are not capable of firing live projectiles. (31) rifles were returned to the federal government as they were no longer being used for training.
b. Purpose: These rifles are for training purposes ONLY by SWAT team members and designated personnel of the Urban Rifle team (URO). These rifles are not used outside of a training environment.
c. Authorized use: These rifles are for training purposes by SWAT team members and designated personnel of the Urban Rifle team (URO). These rifles are not used outside of a training environment.
d. Expected life span: 40 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $500 #18..
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f. Training: Personnel using these for training have either attended MPD’s POST certified 40-hour Urban Rifle course, the POST Certified 16-hour patrol rifle course or the POST certified SWAT Basic course.
g. Legal procedure rules: use is established under Department policy 312 (Firearms). It is the policy of the Modesto Police Department (MPD) to utilize training rifles only for official law enforcement purposes and in a manner pursuant to state and federal law. a. Description, quantity, capabilities and purchase cost:

1. URO Program- Colt AR-15 (32) & Colt M4 (52) rifles Cost: $82,000, Quantity:82
b. Purpose: These rifles are assigned to patrol officers and other sworn personnel as standard issued duty equipment.
c. Authorized use: only selected officers who have attended the POST approved Patrol Rifle course will be issued a department patrol rifle.
d. Expected life span: 10-15 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $8,000 f. Training: Personnel issued and using these rifles have either attended MPD’s POST certified Patrol Rifle course, or the POST certified SWAT Basic course.

Legal procedure rules: use is established under Department policy 312 (Firearms). It is the policy of the Modesto Police Department (MPD) to utilize patrol rifles only for official law enforcement purposes and in a manner pursuant to state and federal law. a. Description, quantity, capabilities and purchase cost:

1. SWAT designated firearms- Colt M4 (14), HK MP5 (6) & HK 416 (15) rifles Cost: $65,000, Quantity:35
b. Purpose: These firearms are issued to and used ONLY by SWAT team members. c. Authorized use: only SWAT officers who have attended the POST certified SWAT Basic course will be issued a department SWAT designated firearm.
d. Expected life span: 10-15 years
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e. Fiscal impact: Annual maintenance costs are projected to be approximately $3,000 f. Training: Personnel issued and using these firearms have attended the POST certified SWAT Basic course. The SWAT team officers also train multiple times per month.

Legal procedure rules: use is established under Department policy 312 (Firearms). It is the policy of the Modesto Police Department (MPD) to utilize rifles only for official law enforcement purposes and in a manner pursuant to state and federal law. a. Description, quantity, capabilities and purchase cost:

1. SWAT Sniper team rifles- BCM .223(1), DPMS 308 (2), Remington 700 308 (2) rifles Cost:
$5,000, Quantity:5
b. Purpose: These rifles are issued and used ONLY by SWAT team members who have been selected to the SWAT Sniper Team.
c. Authorized use: only officers assigned to the SWAT Sniper team will be authorized to use these firearms.
d. Expected life span: 10-15 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $1,000 f. Training: Personnel issued and using these rifles have attended the POST certified SWAT Basic course. Sniper team members also train monthly as a unit.

1. SWAT Historical firearms- Uzi 9mm (5) firearms Cost: $6,000, Quantity:5 b. Purpose: These firearms are not issued or used. They are for display purposes only for historical purposes.
c. Authorized use: there is no authorized use as these are for display purposes only. #18..
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d. Expected life span: 20 years
e. Fiscal impact: there are no annual maintenance costs. f. Training: these firearms are for display purposes only g. Legal procedure rules: use is established under Department policy 312 (Firearms). It is the policy of the Modesto Police Department (MPD) to utilize all firearms only for official law enforcement purposes and in a manner pursuant to state and federal law.

Category 10- None
Category 11-None
Category 12-
Flash Bangs, Tear Gas, pepper balls: Flashbangs are devices used to distract and disorientate dangerous persons. Chemical Agent (tear gas) Canisters contain chemical agents that are released when deployed. Pepper balls are non-lethal projectiles that contain a chemical irritant a. Description, quantity, capabilities and purchase cost.

1. Pepper ball FTC Launchers. Cost: $600 each, Quantity: 5, these launchers are compressed-air powered launchers designed to fire non-lethal Pepper ball projectiles which contain a chemical irritant.

4. Combined Tactical Systems (CTS) 7290 Mini Flashbang, Cost: $40 each, Quantity:62. These are non-bursting, non-fragmenting devices that produce a thunderous bang with intense bright light. They are ideal for distracting dangerous subjects in high risk situations. #18..
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5. Combined Tactical Systems (CTS)5230 CS Gas Canister Cost: $50 each, Quantity: 27, Large diameter canisters that discharge a high volume of smoke and chemical agent through multiple emission ports. Can be thrown or deployed with a launching delivery system.

6. Combined Tactical Systems (CTS)4330 40mm CS Liquid Barricade Ferret rounds. Cost: $25Each, Quantity: 76, These rounds are CS filled projectiles that are used to penetrate intermediate barriers and deliver irritant agents into adjacent rooms. They are used to dislodge barricaded subjects from confined spaces. The purpose is to minimize risks to all persons through pain compliance, temporary discomfort and/or incapacitation of potentially violent or dangerous persons.

7. Defense Technology40mm warning/signaling munition #6029WS Cost $45 each, Quantity:15. These are 40mm launched warning/signaling munitions that deliver 170 dB of sound and bright light

8. CTS 40 MM Aerial Warning Signal Flashbang #4090, Cost: $40 each Quantity: 8 These are 40mm launched warning/signaling munitions that deliver intense sound and bright light and are fired above a crowd during a riot/Civil disorder situation.

9. CTS #4233 40 mm Riot CS Smoke canisters Cost: $45 each Quantity: 17 These are 40mm launched CS smoke munitions that emit CS Chemical irritant and smoke during a riot/Civil disorder situation.

10. CTS #6210 White Smoke Canister Cost: $35 each, Quantity:16 These white smoke canisters are used for obstructing tactical movement and for signaling and marking a landing zone during any air operations. These are thrown manually

11. CTS #6340 OC Aerosol Canisters Cost: $45 each, Quantity:14 These canisters deliver an invisible OC (Chemical irritant) and renders a Temporary respiratory effect on non-complaint subjects. These are thrown manually b. Purpose: Flashbangs are a distraction device used to distract dangerous subjects during hostage recues, room entries or other high-risk situations. They #18..
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produce atmospheric over-Pressure and brilliant white light and as a result can cause short term (6-8 seconds) sensory deprivation to give officers a tactical advantage and increase officer safety. Chemical agent canisters are designed to limit the escalation of conflict and improve officer safety in high risk situations. Situations for use of Chemical agent systems may include but are not limited to:

1. Self-Destructive, dangerous and/or combative subjects

2. Riot/crowd control and civil unrest incidents

3. Circumstances where a tactical advantage can be obtained

4. Potentially vicious animals

5. Training exercise and/or approved demonstrations
c. Authorized use: The use of the Chemical Agent munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal and chemical agent instructors. They can only be used by officers trained in their deployment and in a manner consistent with department policy and training.
d. Expected life span: Pepper ball Launchers:20 years, Pepper ball projectiles: 2 years, Flashbangs: No expiration date. Chemical Agents/Tear gas: 5 years e. Fiscal impact: There are no projected Annual maintenance costs. Supply replacement costs are projected to be $2,000
f. Training: The use of the Chemical agent munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal and chemical agent instructors. The use of flashbangs is authorized to be used by officers of the SWAT team and who are trained in their deployment by POST certified instructors and in a manner consistent with department policy and training.
g. Legal procedure rules: use is established under Department Policy 300 (use of force) and policy308 (Control devices). It is the policy of the Modesto Police Department (MPD) to utilize Chemical agents, their delivery systems and flash bangs only for official law enforcement purposes and in a manner pursuant to state and federal law.
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Category 13- None
Category 14-
Projectile Launch munitions and Platforms: 40mm Launchers are utilized by Department personnel as a Tear gas delivery system and as a Less lethal tool to launch impact rounds. The Less Lethal shotguns are used to deploy the Less Lethal 12-gauge Super-Sock Beanbag Impact round.
a. Description, quantity, capabilities and purchase cost.

1. Remington 870 Less Lethal Shotgun, Cost: $600 each, Quantity: 77, The Remington 870 Less Lethal Shotgun is designated as such with High Visibility Bright Orange Stocks and Foregrips. They are used to deploy the Less Lethal Super-Sock Impact rounds up to a distance of 75 feet. The range of the weapon system helps to maintain space between officers and a suspect reducing the immediacy of the threat which is a principle of De-escalation.

2. 12 Gauge Super-sock Bean Bag Impact round, Cost: $5 per round, Quantity:322. These rounds are a 12-gauge shotgun round firing a ballistic fiber bag filled with 40 grams of lead shot at a velocity of 290 feet per second.

These are considered impact weapons and provide accurate and effective performance when fired from the approved distance of not less than 5 feet.

Effectiveness depends on many variables such as distance, clothing, stature and the area the projectile impacts.

3. Defense technology 40mm Single shot launcher Cost: $1000each, Quantity: 2, The 40mm Single Shot Launcher is a tactical launcher. It will fire standard 40mm Less Lethal Ammunition and gas munitions. These are only authorized to be used by SWAT personnel and specifically designated members of the Mobile Field Force (MFF).

4. LMT 40mm Single shot launcher Cost: $1000 each, Quantity: 4, The 40mm LMT Single Shot Launcher is a tactical launcher. It will fire standard 40mm Less Lethal Ammunition and gas munitions. These are only authorized to be used #18..
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by SWAT personnel and specifically designated members of the Mobile Field Force (MFF).

5. CTS 40MM foam baton munition # 4557 Cost $35 each, Quantity 19: These munitions are a 40mm launched, spin stabilized less lethal direct impact munition.

6. 40 MM Bean Bag Rounds Cost: $25 each, Quantity: 3, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management.

7. Safariland 40 MM Rubber Baton#6064 Cost: $25 each, Quantity: 6, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management.

8. Defense technology 40mm Stinger Rubber Ball Rounds Cost: $25 each, Quantity: 18, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management. Each round contains approx. (18) 60mm rubber balls.
b. Purpose: Less Lethal munitions are designed to limit the escalation of conflict where employment of lethal force is prohibited or undesirable. Situations for use of less lethal weapon systems may include but are not limited to:

1. Self-Destructive, dangerous and/or combative subjects

2. Riot/crowd control and civil unrest incidents

3. Circumstances where a tactical advantage can be obtained

4. Potentially vicious animals

d. Expected life span: Bean bag shotguns:25-30 years, Bean bag munitions: 5 years, 40 mm launchers: 20 years
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e. Fiscal impact: Annual replacement/maintenance costs are projected to be approximately $2,000
f. Training: The use of the less lethal munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal instructors during in service training.
g. Legal procedure rules: use is established under Department Policy 300 (use of force) and policy 308 (Control devices). It is the policy of the Modesto Police Department (MPD) to utilize less lethal munitions and delivery systems only for official law enforcement purposes and in a manner pursuant to state and federal law.

Category 15- None
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Modesto Police Department
Policy 710- Military Equipment Use
Attachment A- Military Equipment Inventory
2024
(Categories correspond with the categories provided in Government Code Section 7070(c) #18..
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Category1-
Unmanned Aerial Vehicles (UAV): An unmanned aircraft along with the associated Equipment necessary to control it remotely.
a. Description, quantity, capabilities and purchase cost of current UAVS.

1. DJI 200 V2 with Zenmuse XT2 Thermal Camera, Cost: $15,000 Quantity: 1 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

2. DJI 200 V1 with Zenmuse Z30 Zoom Camera, Cost: $16,000 Quantity: 1 Remotely operated aerial vehicle that has video recording capabilities and 27 minutes of flight time

3. DJI Mavic2 Thermal, Cost: $1,000 Quantity: 2 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

4. DJI Mavic2 Zoom, Cost: $1,000 Quantity: 2 Remotely operated aerial vehicle that has video recording and Thermal video capabilities and 25-30 minutes of flight time

8. DJI Mavic 3T, Cost $5,500 Quantity 4: Remotely operated aerial vehicle that has built in video recording and Thermal imaging capabilities.

9. DJI Avata 1 with lighting equipment and controllers, Cost $1000, Quantity 2:

Remotely operated aerial vehicle with recording capabilities. For interior Use with 11 minute run time.

10. DJI Avata 2 with lighting equipment and controllers, Cost $1000, Quantity 2:

Remotely operated aerial vehicle with recording capabilities. For interior Use with 18 minute run time.
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b. Purpose: UAVs are to be deployed when its use would assist officers or Incident commanders (ICs)with the following situations, which include but not limited to:

1. Major collision investigations

2. Search for missing persons

3. Search and rescue operations

4. Crowd control Situations

5. Perimeter Searches and security

6. Natural disaster management

7. Crime Scene Investigations and photography

8. SWAT, tactical, or other public safety and life preservation missions

9. In response to specific requests from local, state, or federal fire authorities for fire response and/or prevention.
c. Authorized use: Only authorized operators as set forth in Department Policy 613 shall be permitted to operate any UAV and only during approved missions. d. Expected life span: All UAV equipment 1-3 years
e. Fiscal impact: Annual maintenance and battery replacement cost is projected to be approximately $5,000
f. Training: All UAV operators must go thru in-service training on UAV systems and operations as well as search and seizure laws as well as ongoing in-service training quarterly.
g. Legal procedure rules: Use is established under Department Policy 613 and in accordance with MPD’s FAA Certificate of Authorization. It is the policy of the Modesto Police Department (MPD) to utilize UAVS only for official law enforcement purposes and in a manner that respects the privacy of our community, Constitutional rights and in a manner pursuant to state and federal law.

Robots: A remotely controlled unmanned ground vehicle, which is used to enhance the safety of officers and the community.
a. Description, quantity, capabilities and purchase cost of current robots. #18..
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2. iRobot BB2590 Quantity:1 Cost: $0 obtained from Government surplus program (LESO). This robot is a multi-mission Tactical robot used to carry out dangerous missions in high treat incidents and is remotely operated. b. Purpose: These robots are used to gain visual /audio data in dangerous incidents, deliver communication devices during high risk incidents. They can be used to open doors, disrupt packages and safely clear buildings.
c. Authorized use: The use of robots shall only be authorized by a designated Incident Commander or the SWAT Commander, based on the specific circumstances of a given critical incident. Robots shall only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: All unmanned ground vehicles, 5-10 years e. Fiscal impact: Annual maintenance costs and battery replacement costs are projected to be approximately $3,000
f. Training: all operators will be trained with in-service SWAT training on unmanned ground vehicle operations.
g. Legal procedure rules: use is established under Department Policy 414 (Hostage or barricaded persons) and policy 409 (Crisis Response Unit). It is the policy of the Modesto Police Department (MPD) to utilize unmanned ground vehicles (Robots) only for official law enforcement purposes and in a manner that respects the privacy of our community, pursuant to state and federal law.
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Category 2-
Armored vehicles: Commercially produced wheeled Armored Personnel vehicles utilized for law enforcement purposes.
a. Description, quantity, capabilities and purchase cost of current armored vehicles.

Armored vehicles shall only be used by officers trained in their deployment and in a manner consistent with department policy and training.

D. Expected life span: All Armored vehicles, 20 years
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E. Fiscal impact: Annual maintenance costs are projected to be approximately $20,000
F. Training: all drivers/operators will be trained with in-service training on vehicle operations and practical driving instruction.

G. Legal procedure rules: Use is established under Department Policy 706 (vehicle use) and policy 707 (Armored vehicles). It is the policy of the Modesto Police Department (MPD) to utilize armored vehicles only for official law enforcement purposes and in a manner pursuant to state and federal law.

Category 3- None
Category 4-None
Category 5-
Mobile Incident Command Post vehicles (Mobile CP): Truck and trailer used for a mobile office command Center that provides shelter, access to department computer and communication systems and restroom facilities during extended events. a. Description, quantity, capabilities and purchase cost of current CP vehicles.

2. 2001 Ford F550 truck Cost: $42,159 This Vehicle is used to pull the 5th wheel trailer Mobile command post. And is marked with “Modesto Police” and has emergency lighting.
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b. Purpose: To be used based on the specific circumstances of a given critical incident, large event, natural disaster, community event or for crime scene management. c. Authorized use: The use of the command post vehicles shall only be authorized by a Watch Commander, a designated Incident Commander, SWAT Commander or Crisis Response Unit (CRU) Commander, based on the specific circumstances of a given critical incident. Command Post vehicles shall only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: vehicles, 20 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $10,000 f. Training: all drivers/operators will be trained with in-service training on vehicle operations and practical driving instruction and must be properly licensed through the State of California
g. Legal procedure rules: use is established under Department Policy 706 (vehicle use) and policy408 (Crisis Response Unit). It is the policy of the Modesto Police Department (MPD) to utilize the mobile command post vehicles only for official law enforcement purposes and in a manner pursuant to state law regarding the operation of motor vehicles.

Category 6- None
Category 7-None
Category 8- None
Category 9-
M16A1 Select Fire Rifles: These rifles are used for training purposes only. When used for training these rifles are outfitted with upper receivers that are not capable of firing live 5.56 projectiles. #18..
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a. Description, quantity, capabilities and purchase cost:

1. Colt M4 Semi Auto .223: Cost $0, Quantity 52

2. Colt Ar-15 Semi Auto .223: Cost $0, Quantity 32

3. Daniel Defense Patrol Rifles (DD4-R3). Cost $157,000, Quantity 50 SWAT Weapons

4. M16A1 select fire rifles. Cost: $0, Quantity:21 These rifles were obtained over 20 years ago through the military Surplus program (LESO). These rifles are only used for training. When used for training the rifles are outfitted with upper receivers that are not capable of firing live 5.56 projectiles.

5. H&K MP5, 9mm Semi Auto: Cost 0$, Quantity 6

6. Uzi Submachine guns 9mm: Cost 6000$, Quantity 5

7. DPMS .308 LR Sniper Rifle: Cost $0, Quantity 2

8. Remington 700 .308 Bolt action: Cost $0, Quantity 2

9. BCM Semi Automatic Rifle .556, Cost $0, Quantity 1

10. Daniel Defense SWAT Rifles (DD4-R3S), Cost $65,000, Quantity 24. b. Purpose: These rifles are for training purposes by Patrol Officers whom are part of the Urban Rifle Team (URO) and/or SWAT team members. The M16A1 select fire rifles are used only for training.
c. Authorized use: These rifles are for training purposes by SWAT team members and/or designated personnel of the Urban Rifle team (URO). T The M16A1 select fire rifles are used only for training.
d. Expected life span: 40 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $16,500 f. Training: Personnel using these for training have either attended MPD’s POST certified 40-hour Urban Rifle course or the POST certified SWAT Basic course #18..
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g. Legal procedure rules: use is established under Department policy 312 (Firearms). It is the policy of the Modesto Police Department (MPD) to utilize the rifles only for official law enforcement purposes and in a manner pursuant to state and federal law.

1. Pepper ball FTC Launchers. Cost: $600 each, Quantity: 5, these launchers are compressed-air powered launchers designed to fire non-lethal Pepper ball projectiles which contain a chemical irritant.

3. Pepper ball LIVE projectile, Cost: $2 per projectile Quantity: 3000. The basic pepper ball projectile contains 2% PAVA pepper powder and are designed for direct impact and area saturation, especially in confined interior spaces. the projectile is a non-lethal chemical irritant.

4. Combined Tactical Systems (CTS) 7290 Mini Flashbang, Cost: $40 each, Quantity:44. These are non-bursting, non-fragmenting devices that produce a thunderous bang with intense bright light. They are ideal for distracting dangerous subjects in high risk situations.

5. Combined Tactical Systems (CTS)5230 CS Gas Canister Cost: $50 each, Quantity: 24, Large diameter canisters that discharge a high volume of smoke and chemical agent through multiple emission ports. Can be thrown or deployed with a launching delivery system.
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6. Combined Tactical Systems (CTS)4330 40mm CS Liquid Barricade Ferret rounds. Cost: $25Each, Quantity: 87, These rounds are CS filled projectiles that are used to penetrate intermediate barriers and deliver irritant agents into adjacent rooms. They are used to dislodge barricaded subjects from confined spaces. The purpose is to minimize risks to all persons through pain compliance, temporary discomfort and/or incapacitation of potentially violent or dangerous persons.

7. Defense Technology40mm warning/signaling munition #6029WS Cost $45 each, Quantity:15. These are 40mm launched warning/signaling munitions that deliver 170 dB of sound and bright light

9. CTS #4233 40 mm Riot CS Smoke canisters Cost: $45 each Quantity: 38 These are 40mm launched CS smoke munitions that emit CS Chemical irritant and smoke during a riot/Civil disorder situation.

10. CTS #6210 White Smoke Canister Cost: $35 each, Quantity:18 These white smoke canisters are used for obstructing tactical movement and for signaling and marking a landing zone during any air operations. These are thrown manually

11. CTS #6340 OC Aerosol Canisters Cost: $45 each, Quantity:14 These canisters deliver an invisible OC (Chemical irritant) and renders a Temporary respiratory effect on non-complaint subjects. These are thrown manually b. Purpose: Flashbangs are a distraction device used to distract dangerous subjects during hostage recues, room entries or other high-risk situations. They produce atmospheric over-Pressure and brilliant white light and as a result can cause short term (6-8 seconds) sensory deprivation to give officers a tactical advantage and increase officer safety. Chemical agent canisters are designed to limit the escalation of conflict and improve officer safety in high risk #18..
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situations. Situations for use of Chemical agent systems may include but are not limited to:

1. Self-Destructive, dangerous and/or combative subjects

2. Riot/crowd control and civil unrest incidents

3. Circumstances where a tactical advantage can be obtained

4. Potentially vicious animals

5. Training exercise and/or approved demonstrations
c. Authorized use: The use of the Chemical Agent munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal and chemical agent instructors. They can only be used by officers trained in their deployment and in a manner consistent with department policy and training.
d. Expected life span: Pepper ball Launchers:20 years, Pepper ball projectiles: 2 years, Flashbangs: No expiration date. Chemical Agents/Tear gas: 5 years e. Fiscal impact: There are no projected Annual maintenance costs. Supply replacement costs are projected to be $2,000
f. Training: The use of the Chemical agent munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal and chemical agent instructors. The use of flashbangs is authorized to be used by officers of the SWAT team and who are trained in their deployment by POST certified instructors and in a manner consistent with department policy and training.
g. Legal procedure rules: use is established under Department Policy 300 (use of force) and policy308 (Control devices). It is the policy of the Modesto Police Department (MPD) to utilize Chemical agents, their delivery systems and flash bangs only for official law enforcement purposes and in a manner pursuant to state and federal law.
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Category 13- None
Category 14-
Projectile Launch munitions and Platforms: 40mm Launchers are utilized by Department personnel as a Tear gas delivery system and as a Less lethal tool to launch impact rounds. The Less Lethal shotguns are used to deploy the Less Lethal 12-gauge Super-Sock Beanbag Impact round.
a. Description, quantity, capabilities and purchase cost.

2. Remington 870 with cup launcher attachment, Cost $0, Quantity 3:

3. 12 Gauge Super-sock Bean Bag Impact round, Cost: $5 per round, Quantity:500. These rounds are a 12-gauge shotgun round firing a ballistic fiber bag filled with 40 grams of lead shot at a velocity of 290 feet per second.

These are considered impact weapons and provide accurate and effective performance when fired from the approved distance of not less than 5 feet.

Effectiveness depends on many variables such as distance, clothing, stature and the area the projectile impacts.

4. Defense technology 40mm Single shot launcher Cost: $1000 each, Quantity: 2 The 40mm Single Shot Launcher is a tactical launcher. It will fire standard 40mm Less Lethal Ammunition and gas munitions. These are only authorized to be used by SWAT personnel and specifically designated members of the Mobile Field Force (MFF).

5. LMT 40mm Single shot launcher Cost: $1000 each, Quantity: 4, The 40mm LMT Single Shot Launcher is a tactical launcher. It will fire standard 40mm Less Lethal Ammunition and gas munitions. These are only authorized to be used by SWAT personnel and specifically designated members of the Mobile Field Force (MFF).
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6. CTS 40MM foam baton munition # 4557 Cost $35 each, Quantity 56: These munitions are a 40mm launched, spin stabilized less lethal direct impact munition.

7. 40 MM Bean Bag Rounds Cost: $25 each, Quantity: 77, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management.

8. Safariland 40 MM Rubber Baton#6064 Cost: $25 each, Quantity: 6, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management.

9. Defense technology 40mm Stinger Rubber Ball Rounds Cost: $25 each, Quantity: 19, These munitions are a 40mm launched less lethal impact munition. Used for crowd/riot and civil disorder management. Each round contains approx. (18) 60mm rubber balls.
b. Purpose: Less Lethal munitions are designed to limit the escalation of conflict where employment of lethal force is prohibited or undesirable. Situations for use of less lethal weapon systems may include but are not limited to:

1. Self-Destructive, dangerous and/or combative subjects

2. Riot/crowd control and civil unrest incidents

3. Circumstances where a tactical advantage can be obtained

4. Potentially vicious animals

5. Training exercise and/or approved demonstrations
c. Authorized use: The use of the less lethal munitions and delivery systems are authorized to be used only by 1ficers who have been trained by POST certified Less Lethal instructors. They can only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: Bean bag shotguns:25-30 years, Bean bag munitions: 5 years, 40 mm launchers: 20 years
e. Fiscal impact: Annual replacement/maintenance costs are projected to be approximately $2,000
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f. Training: The use of the less lethal munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal instructors during in service training.
g. Legal procedure rules: use is established under Department Policy 300 (use of force) and policy 308 (Control devices). It is the policy of the Modesto Police Department (MPD) to utilize less lethal munitions and delivery systems only for official law enforcement purposes and in a manner pursuant to state and federal law.

Category 15- None
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Modesto Police Department
Policy 710- Military Equipment Use
Attachment B- Request to Purchase Equipment
2025
(Categories correspond with the categories provided in Government Code Section 7070(c) #18..
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Category 1 -
Unmanned Aerial Vehicles (UAV): An unmanned aircraft along with the associated Equipment necessary to control it remotely.
a. Description, quantity, capabilities, and purchase cost of current UAVs.

1. DJI Mavic 3T, Cost: $6800 Quantity: 2 Remotely operated aerial vehicle.

Camera is 56x zoom, mapping system, and Thermal imaging capabilities for night operations. Purpose: Will replace current mid-size UAVs that are “end of life”. Total cost: $13,600

2. DJI Avata 2, Cost: $1600 Quantity: 3 Remotely operated aerial vehicle. Camera can be adjusted manually and has a “plus battery” feature, whereas most miniature UAVs do not. This package has 3 batteries which will increase overall flight time due to short run time per battery (15-20 mins) Purpose: Quick response and Mini UAV can get into places normal UAVs cannot and replace outdated UAV’s. Total cost: $4800
b. Purpose: UAVs are to be deployed when its use would assist officers or Incident commanders (ICs)with the following situations, which include but not limited to:

1. Major collision investigations

2. Search for missing persons.

3. Search and rescue operations.

4. Crowd control Situations.

5. Perimeter Searches and security

6. Natural disaster management

7. Crime Scene Investigations and photography

8. SWAT, tactical, or other public safety and life preservation missions

9. In response to specific requests from local, state, or federal fire authorities for fire response and/or prevention.
c. Authorized use: Only authorized operators as set forth in Department Policy 613 shall be permitted to operate any UAV and only during approved missions. d. Expected life span: All UAV equipment 1-3 years.
e. Fiscal impact: Annual maintenance and battery replacement cost is projected to be approximately $5,000.
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f. Training: All UAV operators must go through in-service training on UAV systems and operations as well as search and seizure laws as well as ongoing in-service training quarterly.
g. Legal procedure rules: Use is established under Department Policy 613 and in accordance with MPD’s FAA Certificate of Authorization. It is the policy of the Modesto Police Department (MPD) to utilize UAVs only for official law enforcement purposes and in a manner that respects the privacy of our community, Constitutional rights and in a manner pursuant to state and federal law.

Robots: A remotely controlled unmanned ground vehicle, which is used to enhance the safety of officers and the community.
a. Description, quantity, capabilities, and purchase cost of current robots.

1. 4-sight 2.0 Rover unit with lighting kit and RC Motion 3 Controller, COST $4000, Quantity 2: Remotely operated ground vehicle with 25 pound payload capability. 90 minute run time. Total Cost $8,000
b. Purpose: These robots are used to gain visual /audio data in dangerous incidents, deliver communication devices during high risk incidents. They can be used to open doors, disrupt packages and safely clear buildings.
c. Authorized use: The use of robots shall only be authorized by a designated Incident Commander or the SWAT Commander, based on the specific circumstances of a given critical incident. Robots shall only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: All unmanned ground vehicles, 5-10 years e. Fiscal impact: Annual maintenance costs and battery replacement costs are projected to be approximately $4,000
f. Training: All operators will be trained with in-service SWAT training on unmanned ground vehicle operations.
g. Legal procedure rules: Use is established under Department Policy 414 (Hostage or barricaded persons) and policy 409 (Crisis Response Unit). It is the policy of the Modesto Police Department (MPD) to utilize unmanned ground vehices (Robots) only for official law enforcement purposes and in a manner that respects the privacy of our community, pursuant to state and federal law.
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Category 2-
Armored vehicles: Commercially produced wheeled Armored Personnel vehicles utilized for law enforcement purposes.
a. Description, quantity, capabilities and purchase cost of current armored vehicles.

1. 2025 Lenco Bearcat cost: $400,000. The Lenco Bearcat is an armored vehicle that seats 10-12 personnel with an open floor plan that allows for rescue of downed personnel. The vehicle has ballistic capabilities which provide greater safety to citizens and officers beyond the protection level of Ballistic shields or personal body armor. The current armored vehicle is 20 years old. b. Purpose: Armored vehicles are to be used in response to Critical Incidents to enhance officer and community safety, improve scene containment and stabilization and assist in resolving critical incidents
c. Authorized use: The use of Armored vehicles shall only be authorized by a Watch Commander, a designated Incident Commander or the SWAT Commander, based on the specific circumstances of a given critical incident. Armored vehicles shall only be used by officers trained in their deployment and in a manner consistent with department policy and training.
d. Expected life span: All Armored vehicles, 20 years
e. Fiscal impact: Annual maintenance costs are projected to be approximately $25,000 f. Training: All drivers/operators will be trained with in-service training on vehicle operations and practical driving instruction.
g. Legal procedure rules: Use is established under Department Policy 706 (vehicle use) and policy 707 (Armored vehicles). It is the policy of the Modesto Police Department (MPD) to utilize armored vehicles only for official law enforcement purposes and in a manner pursuant to state and federal law.
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Category 12 -
Flash Bangs, Tear Gas, pepper balls: Flashbangs are devices used to distract and disorientate dangerous persons. Chemical Agent (tear gas) Canisters contain chemical agents that are released when deployed. Pepper balls are non-lethal projectiles that contain a chemical irritant. a. Description, quantity, capabilities, and purchase cost.

1. 7290 Mini Flashbang, Cost: $45 each, Quantity 48. Purpose: Needed to replenish current stock from use during SWAT missions and training. Total Cost: $2,160.

2. 5230 CTS CS Gas Canister, Cost: $60 each, Quantity 40. Purpose: Needed to replenish current stock from use during SWAT missions and training. Total Cost: $2,400.

3. 5230B CTS Canister, Cost: $40 each, Quantity 40. Purpose: Needed to replenish current stock from use during SWAT missions and training. Large diameter canisters that discharge a volume of smoke and chemical agent through multiple emission ports. Can be thrown or deployed with a launching delivery system. Total Cost: $1,600.

4. 5210 CTS Smoke Canister, Cost: $40 each, Quantity 45. Purpose: Needed to replenish current stock from use during SWAT missions and training. Large diameter canisters that discharge a volume of white or colored smoke through multiple emission ports. Can be thrown or deployed with a launching delivery system. Total Cost: $1800.

5. 4330 CTS 40mm CS Liquid Barricade Ferret rounds. Cost: $25Each, Quantity: 100, These rounds are CS filled projectiles that are used to penetrate intermediate barriers and deliver irritant agents into adjacent rooms. They are used to dislodge barricaded subjects from confined spaces.

The purpose is to minimize risks to all persons through pain compliance, temporary discomfort and/or incapacitation of potentially violent or dangerous persons. Total Cost: $2,500.
b. Purpose: Flashbangs are a distraction device used to distract dangerous subjects during hostage rescue, room entries or other high-risk situations. They produce atmospheric over-Pressure and brilliant white light and as a result can cause short term (6-8 seconds) sensory deprivation to give officers a tactical advantage and increase officer safety. Chemical agent canisters are designed to limit the escalation #18..
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of conflict and improve officer safety in high-risk situations. Situations for use of Chemical agent systems may include but are not limited to:

1. Self-Destructive, dangerous and/or combative subjects.

2. Riot/crowd control and civil unrest incidents.

3. Circumstances where a tactical advantage can be obtained.

4. Potentially vicious animals.

5. Training exercise and/or approved demonstrations.
c. Authorized use: The use of the Chemical Agent munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal and chemical agent instructors. They can only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: Pepper ball Launchers: 20 years, Pepper ball projectiles: 2 years, Flashbangs: No expiration date. Chemical Agents/Tear gas: 5 years. e. Fiscal impact: There are no projected Annual maintenance costs. Supply replacement costs are projected to be $5,000.
f. Training: The use of the Chemical agent munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal and chemical agent instructors. The use of flashbangs is authorized to be used by officers of the SWAT team and who are trained in their deployment by POST certified instructors and in a manner consistent with department policy and training. g. Legal procedure rules: Use is established under Department Policy 300 (use of force) and policy308 (Control devices). It is the policy of the Modesto Police Department (MPD) to utilize Chemical agents, their delivery systems and flash bangs only for official law enforcement purposes and in a manner pursuant to state and federal law.

Category 14 -
Projectile Launch munitions and Platforms: 40mm Launchers are utilized by Department personnel as a Tear gas delivery system and as a Less lethal tool to launch impact rounds. The Less Lethal shotguns are used to deploy the Less Lethal 12-gauge Super-Sock Beanbag Impact round.
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a. Description, quantity, capabilities, and purchase cost.

1. 4557 CTS 40MM foam baton, Cost: $25 each, Quantity 100. Purpose:

Needed to replenish current stock from use during Mobile Field Force, SWAT mission, and training. Total Cost: $2500.

2. CTS 12GA Super Stock Bean Bag Model 2581, Cost: $7 each, Quantity 750.

Purpose: Needed to replenish current stock from use during Mobile Field Force, patrol operations, SWAT missions, and training. Total Cost: $5,250

3. CTS #6340 OC Aerosol Canisters Cost: $45 each, Quantity:10 These canisters deliver an invisible OC (Chemical irritant) and render a Temporary respiratory effect on non-complaint subjects. These are thrown manually. Total Cost: $450

4. Safariland #6064 40MM Rubber Baton, Cost: $30 each, Quantity: 15 Needed to replenish current stock from use during Mobile Field Force, SWAT mission, and training. Total Cost: $450

5. CTS 40 MM Aerial Warning Signal Flashbang #4090, Cost: $40 each Quantity: 20 These are 40mm launched warning/signaling munitions that deliver intense sound and bright light and are fired above a crowd during a riot/Civil disorder situation. Purpose: Needed to replenish current stock from use during Mobile Field Force, patrol operations, SWAT missions, and training. Total Cost: $800

6. Remington 870 Less Lethal Shotgun, Cost: $600 each, Quantity: 20, The Remington 870 Less Lethal Shotgun is designated as such with High Visibility Bright Orange Stocks and Foregrips. They are used to deploy the Less Lethal Super-Sock Impact rounds up to a distance of 75 feet. The range of the weapon system helps to maintain space between officers and a suspect reducing the immediacy of the threat which is a principle of De-escalation.

Total Cost: $12,000
b. Purpose: Less Lethal munitions are designed to limit the escalation of conflict where employment of lethal force is prohibited or undesirable. Situations for use of less lethal weapon systems may include but are not limited to:
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1. Self-Destructive, dangerous and/or combative subjects.

2. Riot/crowd control and civil unrest incidents.

3. Circumstances where a tactical advantage can be obtained.

4. Potentially vicious animals.

5. Training exercise and/or approved demonstrations.
c. Authorized use: The use of the less lethal munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal instructors. They can only be used by officers trained in their deployment and in a manner consistent with department policy and training. d. Expected life span: Bean bag shotguns: 25-30 years, Bean bag munitions: 5 years, 40 mm launchers: 20 years.
e. Fiscal impact: Annual replacement/maintenance costs are projected to be approximately $2,000.
f. Training: The use of the less lethal munitions and delivery systems are authorized to be used only by officers who have been trained by POST certified Less Lethal instructors during in-service training.
g. Legal procedure rules: Use is established under Department Policy 300 (use of force) and policy 308 (Control devices). It is the policy of the Modesto Police Department (MPD) to utilize less lethal munitions and delivery systems only for official law enforcement purposes and in a manner pursuant to state and federal law. #18..
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

May 6, 2025
April 8, 2025
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: Bill Sandhu, Director of Public Works
SUBJECT: Purchasing Agreement with Telcion Communications Group for Ethernet Switches CONTACT: Max Navarro, Associate Engineer, [email protected], 209-571-5116 DESCRIPTION:

Consider approving a Purchasing Agreement with Telcion Communications Group, Turlock, CA, for ethernet switch equipment for a total amount not to exceed $2,025,000 over five years. (Funding Source: Measure L)
STRATEGIC PLAN ELEMENT:

This item is consistent with Council’s Strategic Plan Area of Focus “Quality of Life Goals and Strategies”; engage partners across the community to ensure the safety, resilience, and attractiveness of Modesto; Goal A: “Improve community safety and quality of life through a combination of prevention and intervention efforts that address safety and it’s underlying issues.”
BACKGROUND:

The City of Modesto Public Works Traffic Engineering and Electrical Divisions in conjunction with the Informational Technology Department operate and maintain the City’s Advanced Traffic Management System (ATMS). A critical component of the network management and infrastructure are ethernet switches. City staff reviewed and tested several different brands of equipment and chose to proceed with Cisco ethernet switches because of the hardware’s hardened ability to be operational in the field and the software’s intellectual ability to be configured in our connected system. The equipment was standardized and all active communication between traffic signals and the ATMS server occurs through Cisco ethernet switches. We currently have 53 of 159 traffic signals communicating. Connecting and maintaining a live connection to traffic signals aligns with the Traffic Signal Masterplan to proactively evaluate and update time-of-day signal timing plans.

On January 28, 2020, by Resolution No. 2020-056, Council accepted the Traffic Signal Master Plan identifying traffic signal communications as a Local Street Management Strategy to enhance signal operations for all modes of transportation. #19..
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City Council May 6, 2025
Purchasing Agreement with Telcion Communications Group for Ethernet Switches

Page 2 of 3 ends

DISCUSSION:

The coordination and active evaluation of signal performance is a day-to-day task for the Traffic Engineering, Operations and Electrical Divisions. Our coordinated signal system allows motorists to progress in sequence so platoons of vehicles can proceed through a series of green lights. Adding the use of wireless radio communications will build on our existing investment in traffic signal management and circulation throughout the City of Modesto. An Authorization to Purchase was approved December 23, 2024.

On December 18, 2020, the County of Merced issued Request for Proposal (RFP) No. 7370, under Contract No.2021106 for the purchase of Cisco ethernet switches on the Public advertising – i.e., Southern California News Group Marketplace. On January 15, 2021, proposals were opened at Merced County located at 2222 M Street, Merced, CA 95340. Five bids were received and based on the committee review process and criteria of 100 points possible outlined in RFP No. 7370, one contract was awarded for this commodity which includes the Cisco Ethernet Switches. Based on the responsive and responsible proposer offering overall evaluation for comprehensiveness, experience, performance, scope of work, time and acceptance to the terms and conditions, City staff recommends to award to Telcion Communications Group, Turlock, CA to purchase Cisco Ethernet Switches for an amount not to exceed $2,025,000.

Merced County is a cooperative agency which streamlines the procurement process by developing RFP No. 7370 for national competitive solicitations that meet or exceed local requirements. The competitive process is continually refined to best meet agency needs and allows Merced County to offer exceptional products from nationally acclaimed vendors.

Modesto Municipal Code Section 8-3.203 generally requires all purchases, which meet or exceed $100,000 for material, equipment, or contractual services be formally bid. However, exceptions to the formal bidding process are granted in MMC 8-3.204(d) “Where the Purchasing Manager, in his or her discretion, determines that a process other than the formal bid procedure set forth in Section 8-3.203 will result in procurement for the City at the lowest possible cost commensurate with the desired quality.” In addition, MMC-8-3.202(h) encourages the Purchasing Manager to join with the State of California and other units of government in cooperative purchasing plans when the best cost savings interest the City would be served. By utilizing the County of Merced, the City is complying with the requirements defined under this code for Cisco ethernet switches.

FISCAL IMPACT:

The City is utilizing our local Measure L Traffic Management funds for this project. The budget is in Project 101581.
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City Council May 6, 2025
Purchasing Agreement with Telcion Communications Group for Ethernet Switches

Page 3 of 3 ends

ANTICIPATED AGREEMENT EXPENDITURES
Vendor Equipment
FY 2024/2025 $405,000
FY 2025/2026 $405,000
FY 2026/2027 $405,000
FY 2027/2028 $405,000
FY 2028/2029 $405,000
TOTAL $2,025,000
COMMITTEE RECOMMENDATION:

On April 7, 2025, this item was presented to the Economic Development Committee and was recommended for forwarding to Council for approval.

CEQA/NEPA REQUIREMENTS:

The State has determined that this project has no significant impact on the environment as defined by the California Environmental Quality Act (CEQA) under Section 15301 (c) of the CEQA guidelines.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving a Purchasing Agreement with Telcion Communications Group, Turlock, CA, by utilizing the Competitive Bid Process with National Intergovernmental Purchasing Alliance (National IPA), Merced County, for ethernet switch equipment, for a three year agreement with two one-year extension options, for an annual estimated amount of $405,000, and a total amount not to exceed $2,025,000 over five years; and authorizing the Director of Finance, or her designee, to execute the Purchasing Agreement.

Approved by:

Bill Sandhu, Public Works Director
Joseph P. Lopez, City Manager
Attachments:

1. Resolution

2. Purchasing Agreement No. 294402

3. Exhibit B Price Schedule

4. Exhibit C – Telcion RFP 7370 - Response

5. Scoring Abstract
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1 2025-

MODESTO CITY COUNCIL
RESOLUTION NO. 2025-

RESOLUTION APPROVING A PURCHASING AGREEMENT WITH TELCION

COMMUNICATIONS GROUP, TURLOCK, CA, BY UTILIZING THE

COMPETEIVE BID PROCESS WITH NATIONAL INTERGOVERNMENTAL

PURCHASING ALLIANCE (NATIONAL IPA), MERCED COUNTY, FOR

ETHERNET SWITCH EQUIPMENT FOR A THREE-YEAR AGREEMENT

WITH TWO ONE-YEAR EXTENSION OPTIONS, FOR AN ANNUAL
ESTIMATED AMOUNT OF $405,000 AND A TOTAL AMOUNT NOT TO
EXCEED $2,025,000 OVER FIVE YEARS; AND AUTHORIZING THE

DIRECTOR OF FINANCE, OR HER DESIGNEE, TO EXECUTE THE

PURCHASING AGREEMENT
WHEREAS, the City of Modesto Public Works Traffic Engineering and Electrical Divisions in conjunction with Information Technology Department operate and maintain the City’s Advanced Traffic Management System (ATMS); and WHEREAS, ethernet switch equipment is a critical component of the ATMS network architecture and network management. City staff reviewed and tested several different brands of equipment and chose to proceed with Cisco ethernet switches because of the hardware’s hardened ability to be operational in the field and the software’s intellectual ability to be configured in our connected system. The equipment was standardized and all active communication between traffic signals and the ATMS server occurs through Cisco ethernet switches; and
WHEREAS, on January 28, 2020, by Resolution No. 2020-056, Council accepted the Traffic Signal Master Plan identifying traffic signal communications as a Local Street Management Strategy to enhance signal operations for all modes of transportation; and WHEREAS, on December 23, 2024, the City Manager authorized the Purchasing Manager to solicit the procurement of ethernet switch equipment. As part of a cooperative purchasing plan, the Purchasing Manager identified the County of Merced #19..
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2 2025-
Request for Proposals (RFP) No. 7370 under contract No. 2021106 for the purchase of Cisco ethernet switches on the Public advertising – i.e. Southern California News Group Marketplace. On January 15, 2021, proposals were opened at Merced County located at 2222 M Street, Merced, CA 95340. Five bids were received and based on the committee review process and criteria of 100 points possible outlined in RFP No. 7370, one contract was awarded for this commodity which includes the Cisco Ethernet Switches. Based on the responsive and responsible proposer offering overall evaluation for comprehensiveness, experience, performance, scope of work, time and acceptance to the terms and conditions, City staff recommends to award to Telcion Communications Group, Turlock, CA to purchase Cisco Ethernet Switches; and WHEREAS, the Director of Public Works has recommended that the purchasing agreement not to exceed $2,025,000 received from Telcion Communications Group, be accepted as competitive from a Cooperative Agreement agency and that the agreement be approved for Telcion Communications Group; and
WHEREAS, Modesto Municipal Code Section 8-3.203 generally requires all purchases, which meet or exceed $100,000 for material, equipment, or contractual services be formally bid. However, exceptions to the formal bidding process are granted in MMC 8-3.204(d) “Where the Purchasing Manager, in his or her discretion, determines that a process other than the formal bid procedure set forth in Section 8-3.203 will result in procurement for the City at the lowest possible cost commensurate with the desired quality.” In addition, MMC-8-3.202(h) encourages the Purchasing Manager to join with the State of California and other units of government in cooperative purchasing plans when the best cost savings interest the City would be served. By utilizing the County of #19..
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3 2025-
Merced, the City is complying with the requirements defined under this code for Cisco ethernet switches.

NOW, THEREFORE BE IT RESOLVED, by the Council of the City of Modesto that it hereby approves a Purchasing Agreement with Telcion Communications Group, Turlock, CA, by utilizing the competitive bid process with National Intergovernmental Purchasing Alliance (National IPA), Merced County, for ethernet switch equipment for a three-year agreement with two one-year extension options, for an annual estimated amount of $405,000 and a total amount not to exceed $2,025,000 over five years.

BE IT FURTHER RESOLVED, that the Director of Finance, or her designee, is hereby authorized to execute the Purchasing Agreement.
#19..
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4 2025-
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 6th day of May 2025, 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
#19..
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1 TELCION COMMUNICATIONS GROUP PURCHASE AGREEMENT NO. 294402 This agreement, hereinafter called AGREEMENT, made and entered into in the City of Modesto, State of California, this _______ day of ________________, 2025, by and between the City of Modesto, a municipal corporation of the State of California, hereinafter called CITY, and Telcion Communications Group , a California Corporation, hereinafter called VENDOR, WHEREAS, the Modesto City Council adopted Resolution No. 2025-______ authorizing the Award of Bid and agreement for the Cisco ethernet switches described herein (the “GOODS”) to VENDOR, attached hereto as Exhibit “A”, and made a part hereof, and WHEREAS, the VENDOR 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 VENDOR shall enter into an agreement for the purchase of Cisco ethernet switches as described in IFB 7370 attached hereto as Exhibit “C” and made a part hereof, and NOW, THEREFORE, the parties hereto mutually agree as follows:

1. TERM OF AGREEMENT:

The term of the AGREEMENT shall be for a period of three (3) years with two (2) one-year extension options at the sole discretion of City, for a total of up to five years. #19..
- 742 -
2 2. PRICING:
a. Per the aforementioned Council Resolution, the annual estimated amount of the AGREEMENT is $405,000. The total amount paid by CITY to VENDOR over the full term of the AGREEMENT shall not exceed $2,025,000.
b. Pricing during AGREEMENT for the initial purchase shall be set forth in Exhibit B. Subsequent purchases in year one and two shall be priced as set forth in Exhibit B Pricing (Merced FOCUS Contract), attached hereto and made a part hereof by this reference. c. Pricing shall remain firm for the two (2) years of the AGREEMENT. d. Price increases for each subsequent AGREEMENT years two, three, four, and five, shall be negotiated in good faith by the parties, but in no instance may exceed the net percentage increase during the prior 12-month period in the Federal Bureau of Labor Statistics’ Consumer Price Index (CPI) for West Urban Area. Requests for price increases in any renewal year shall be submitted by VENDOR in writing at least ninety (90) days prior to the annual anniversary date of the AGREEMENT.

3. USAGE:

Vendor shall provide whatever quantities may be required during the term of this Agreement.

No minimum or maximum quantities are guaranteed or implied by CITY.

4. ORDERING:

Vendor shall deliver GOODS to the location specified within CITY’s purchase order. Unless specified by the Purchasing Division, no GOODS may be delivered to CITY unless a purchase order has been provided by CITY to VENDOR.

5. PAYMENT:

All invoices shall be paid in full by CITY after completion and acceptance of the GOODS by the City, and receipt of a properly prepared invoice submitted by VENDOR via email to [email protected]. As specified by the Purchasing Division, every invoice must reference #19..
- 743 -
3 this AGREEMENT number or CITY’s purchase order number. VENDOR will be paid by CITY via the following payment method Net 45 Days via manual check.

6. AMENDMENTS:

No changes to this AGREEMENT shall be effective unless documented by a written amendment to this AGREEMENT and signed by the parties hereto with CITY represented by the Purchasing Division

7. TERMINATION:
a. In the event either party fails to perform under this AGREEMENT or breaches any condition contained herein, the other party shall notify in writing the breaching party of the nonperformance. Within thirty (30) days after receipt of notification, the breaching party shall correct any non-performance to the reasonable satisfaction of the non-breaching party. Failure to correct any non-performance shall allow the non-breaching party to terminate this AGREEMENT for cause.
b. CITY may terminate this AGREEMENT for convenience upon thirty (30) days prior notice to VENDOR by CITY’s authorized employee.

8. INSPECTION:

All GOODS are subject to inspection and testing by the CITY for compliance with specifications as included herein, within a reasonable time after delivery. In the event GOODS are defective or not in conformity with this AGREEMENT or CITY’s purchase order, the CITY shall have the right to either reject the GOODS or require correction. Defective articles or services shall be removed from CITY premises and/or corrected by and at the expense of VENDOR; provided that should the VENDOR fail, neglect or refuse to do so, the CITY shall thereupon have the right to purchase in the open market, in lieu thereof, a corresponding quantity of any such items. CITY may deduct from any moneys due or that may there after coming due to VENDOR or send an invoice to the VENDOR which shall be paid within thirty (30) days, the difference between the prices named in the contract or purchase order and the actual #19..
- 744 -
4 cost thereof to the CITY. In the event that the VENDOR 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. Cost of inspection or deliveries or offers for delivery, which do not meet specifications, will be borne by the Bidder. Failure by CITY to inspect and accept or reject shall not relieve the VENDOR from responsibility for compliance with specifications. Final acceptance shall be conclusive except as regards to latent defects, fraud, or such gross mistakes as amount to fraud.

9. RESPONSIBILITY:

Unless otherwise specified, the VENDOR shall be responsible for all GOODS until delivered at CITY’s designated delivery point and shall bear all risks as to items rejected or requiring correction after notice of such rejection or correction is given.

10. SHIPMENT:

Unless otherwise authorized by CITY’s Purchasing Division, GOODS shall be delivered F.O.B.

Destination Freight Prepaid and Included in Price of GOODS. VENDOR may not collect freight collect or charge shipping expenses otherwise to CITY. Original receipted freight bill must accompany the invoice. Shipment must be made within the time stated on Purchase Order, failing which CITY reserves the right to purchase elsewhere and charge VENDOR with any loss incurred, unless delay in making shipment is due to unforeseeable causes beyond the control and without the fault or negligence of VENDOR.

11. CHANGES:

The AGREEMENT or purchase order may at any time, by written order of the CITY, be changed in regard to the GOODS to be furnished, quantities ordered, unit price, discount, delivery point or arrangements, terms or any other matters affecting a valid purchase order or AGREEMENT. In the event such change causes an increase or decrease in the cost of performance hereunder, and equitable #19..
- 745 -
5 adjustment will be made for the cost thereof, subject to the approval of the Purchasing Manager, and written notice given, therefore.

12. WARRANTY:

Notwithstanding any other provisions of the purchase order, VENDOR warranties for the GOODS shall extend for 90 days after delivery thereof to CITY, shall meet or exceed all original manufacturer warranties, and that GOODS shall be of the most suitable grade as specified in this AGREEMENT, VENDOR’s own marketing materials and in the purchase order. Moreover, VENDOR warrants and represents that GOODS shall comply with warranties of merchantability and fitness for a particular purpose. If a defect is discovered in any GOODS covered in this AGREEMENT, VENDOR shall correct at its expense, including transportation/freight, such defects as are reported within one year of final acceptance.

13. INSURANCE:

Any AGREEMENT or purchase order where work, maintenance, or service is performed on CITY property requires appropriate insurance. VENDOR shall ensure proper insurance certificates are on file with the CITY prior to performing onsite work. Contact CITY’s Purchasing Division to verify the type of insurance required.

14. TAX EXEMPTIONS:

The CITY is exempt from payment of federal excise tax. All invoices shall be exclusive of such excise tax. Moreover, if the CITY’s purchase is not subject to sales tax, the statement for resale will appear in the body of the purchase order.
#19..
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6 15. INDEMNITIES:
a. VENDOR agrees to protect, indemnify and save harmless CITY and its agents, officers, employees, and volunteers from any claim, loss or damage from VENDOR’s, or the GOODs’, infringement of trademarks, patents, copyrights and unfair competition action with to any third party.
b. VENDOR shall hold the CITY and 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 VENDOR, or its agents, officers, employees, or subcontractors relating to or during the performance of its obligations under this AGREEMENT, except for claims arising from the willful or active negligence of the CITY. VENDOR’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 for VENDOR to procure and maintain a policy of insurance VENDOR.

16. 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, U.S.A., without giving effect to its conflicts of law provisions or principles.

17. VENUE:

Venue for 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 in the Superior Court of Stanislaus County or the United States District Court for the Eastern District of California.
#19..
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7 18. ATTORNEYS’ FEES.

If a party to this AGREEMENT brings any action, including an action for declaratory relief, to enforce or interpret the provision of this AGREEMENT, the prevailing party shall be entitled to reasonable attorneys’ fees in addition to any other relief to which that party may be entitled. The court may set such fees in the same action or in a separate action brought for that purpose.

19. LIMITATION OF LIABILITY:

The CITY shall not be responsible for any damage that may accrue by reason of the death or injury of the person of the VENDOR’s officers, agents, employees, invitees, or licensees, or be set up at any time because of personal injury or damage to property sustained by any other person or persons, which may have been caused or contributed to, approximately or remotely, by reason of or in the course of performance of the AGREEMENT. The VENDOR shall assume full responsibility for the defense of any claims arising under the AGREEMENT and the VENDOR shall save, keep, and bear harmless the CITY, all officers and employees thereof, from all damages, costs, or expenses because of personal injury or property damage based on the performance of this AGREEMENT or asserted against it.

20. 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: Darren Rodrigues
Telcion Communications Group
117 S Broadway
Turlock, CA 95380
CITY: City of Modesto
Purchasing Division
P.O. Box 642
Modesto, CA 95353
#19..
- 748 -
8 Either party may change its address for delivery of notice by delivering written notice of such change of address to the other party.

21. ASSIGNMENT:

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

22. MISCELLANEOUS:

Time is of the essence in each and every provision of this AGREEMENT.

23. ENTIRE AGREEMENT:

This AGREEMENT and its exhibits contain the entire understanding between VENDOR and CITY. Additional or new terms contained in this AGREEMENT which vary from VENDOR’S bid are controlling and are deemed accepted by VENDOR by provision of any GOODS or other commencement of performance hereunder. The terms and conditions of the IFB, attached hereto as Exhibit C, are incorporated herein. In the event of a conflict between the IFB and this AGREEMENT, this AGREEMENT shall control. All previous bids, 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 the parties.

24. 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.
#19..
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9 IN WITNESS WHEREOF, the CITY OF MODESTO, a municipal corporation, has authorized the execution of this AGREEMENT by its Director of Finance under authority of Resolution No. 2025- ____ adopted by the Council of the City of Modesto on the _________ day of _________________, 2025- and Telcion Communications Group has caused this Agreement to be duly executed. #19..
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EXHIBIT B Pricing Schedule
Contractor should be prepared to demonstrate how they will provide standard and advanced information technology, telecommunications, imaging, homeland security technology.

Option A – County of Merced works with Telcion on an exclusive pre-sales basis to determine solution/products/scope and project/order is $10k or higher

CATEGORY HOW

SUPPLIED
%

DISCOUNT

OFF LIST
PRICE

1.0 Communications Services
Call Center Solutions (with ACD) Cisco 45%
Emergency Notification Solutions (Reverse
911)
Cisco 45%
Engineering/Consulting Services Cisco 10%
Integrated Voice Response (IVR) Cisco 45%
Voice over Internet Protocol (VOIP) Cisco 45%
Unified Messaging (UM) Cisco 45%
Long Distance Services (Switched, Dedicated)
Telecommunications Systems (PBX) Cisco 45%
Telephone Handsets Cisco 45%
#19..
- 751 -
Voice Mail Solutions Cisco 45%
Wireless Voice Communication Services Cisco 45%

2.0 Application Systems
Development
Installation Solutions
Version Control Solutions

3.0 Infrastructure
Battery Backup Systems
Cabling Services Panduit/Berktek20%
Energy Auditing and Management Solutions

4.0 Enterprise Mobility Solutions
Mobile Device Management Cisco/Meraki 45%
Mobile Devices (Tablets)
Mobile Applications

5.0 Maintenance Services Telcion 10%
#19..
- 752 -

6.0 Network & Enterprise Security Solutions
Firewall & Virtual Private Network (VPN)
Solutions
Cisco 45%
Intrusion Detection/Prevention Solutions Cisco 45%
Network, Host & Enterprise Management
Solutions
Cisco 45%
Transport Solutions (PRI, MPLS, Super-trunks,
CO Business Lines, Optical, Satellite, Wireless)
Video Solutions Cisco 45%
Wireless Solutions (Wi-Fi) Cisco 45%

7.0 E-Government
Web Site Analytics
Web Site Content Management Solutions
Web Site Design, Development, Hosting
Services
Web Site Development Tools
Web Site Intranet Solutions
#19..
- 753 -
Web Monitoring & Filtering Solutions Cisco 45%
Web Site Portal Solutions

8.0 Enterprise Systems
Virtualization (Servers) VMWare 10%
Virtual Desktop Infrastructure (VDI) VMWare 10%
Anti-Virus, Spam, Spyware Solutions Cisco 45%
Data Encryption Products & Services Cisco 45%
Helpdesk Solutions
Hosting Services and Applications (Cloud and
SaaS)
Cisco 30%
Radio Frequency Identification (RFID) Cisco 45%
Server, Storage & Data Management Products Cisco 45%
Telepresence/Video Conferencing Cisco 45%

9.0 Training Solutions Telcion 10%

10.0 Consulting Services Telcion 10%
#19..
- 754 -

11.0 Other Goods and Services
Cisco SmartNet Contracts
Cisco Cloud Services (Webex Calling/Webex etc.)
Labor: Project Manager
Labor: Systems Engineer CCVP VOICE
Labor: Systems Engineer CCIE
Labor: Systems Engineer LAN/WAN/WIRELESS
Labor: Systems Engineer Security
Labor: Systems Engineer Telepresense
Labor: Systems Engineer Training
Labor: Cabling (Team of 2)
Labor: Project Manager Cabling
List Price
Cisco
Cisco
$225
$225
$250
$225
$225
$225
$200
$120
$200
Discount
19%
30%
10%
10%
10%
10%
10%
10%
10%
10%
10%
#19..
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EXHIBIT C
#19..
- 756 -
Telcion Communications Group
140 West Main|Turlock, CA 95380|209.632.5700|www.telcion.com

Proposal: RFP #7370 – Fast Open Contracts
Utilization Services (FOCUS)
Prepared For:

County of Merced
Requested By:

Jose Hurtado
January 15, 2021
Prepared by:

Darren Rodrigues
Business Communications Consultant
209.656.5740
[email protected]
Lance Reid
Voice CCIE #14888
209.656.5750
[email protected]
#19..
- 757 -
Telcion Communications Group
140 West Main|Turlock, CA 95380|209.632.5700|www.telcion.com Notice
The information contained in this document is confidential information between Telcion and County of Merced.Its purpose is to communicate the details of a proposed business solution from Telcion to the client. All information is to be kept confidential and used only to determine the feasibility and acceptability of the proposed solution by Telcion.

This document is the property of, and is proprietary to Telcion. It is not to be disclosed in whole or in part without the express, written authorization of Telcion, and shall be returned upon request.
All Trademarks are the property of their respective owners. #19..
- 758 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 1
EXECUTIVE SUMMARY .............................................................................................................................................. 2 EXCEPTIONS ................................................................................................................................................................... 3 APPROACH ....................................................................................................................................................................... 4 BIDDER’S QUALIFICATION ...................................................................................................................................... 7 History: ............................................................................................................................................................................. 7 Background and Experience: ........................................................................................................................................ 7 References:..................................................................................................................................................................... 10 #19..
- 759 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 2

EXECUTIVE SUMMARY
County of Merced desires a means for counties, cities, schools, special districts and other governmental entities in California and nationally to purchase their needed technology solutions through a formally bid contractual relationship.Telcion is very familiar with the needs of these organizations and the difficulty of RFPs and delays due to them.Telcion has several CMAS contracts in place already, which are based upon federal GSAs in place, as well as a master contract in place at Stanislaus County with a similar structure as we are proposing in our offering.Pricing is available onͲline via GSA Advantage for latest list price.We have a track record with Merced County already, as well as hundreds of government and education clients in the Central Valley.

Telcion has provided two pricing options for County of Merced based upon project size and whether Merced works with Telcion exclusively in the presales phase to develop the product list/scope. (1A and 1B Category of Service).

#19..
- 760 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com
January 13, 2021 3

EXCEPTIONS
Telcion does not take any exceptions to the requirements, RFP or sample agreement. #19..
- 761 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 4

APPROACH
Telcion will meet the requirements of the RFP and perform the duties outlined.

Telcion will provide FREE preͲsales engineering help for any solution desired by the agency and utilizing this service will provide the highest levels of discounts for the organization.

Telcion has published pricing available onͲline (via GSA) as retail prices tend to change often.Our pricing provided is % off list price.
For any sales, Telcion will accept any P.O.s via eͲmail, or mailed to the office.Telcion will process any orders and provide etas weekly.For any projects (with labor), a project manager will be assigned, timeline with milestones and detailed scope of work.Weekly project meetings will occur.

Telcion will provide reports of usage of this contract on a quarterly basis, as specified by the RFP.

Here is an example project milestone we provided to a local education institution in 2020.

Task Name Start Finish Duration
Milestones 5/1/2020 7/7/2020 68d
Project Planning 5/1/2020 5/14/2020
Project Kickoff 5/1/2020 5/1/2020
All Parts have arrived 5/14/2020 5/14/2020
Base equipment staged and ready for final configuration 5/14/2020 6/7/2020 System ready for initial testing 6/7/2020 6/14/2020 System ready for final testing 6/14/2020 6/21/2020
User Training 6/14/2020 6/21/2020
Go live 6/21/2020 6/21/2020
Day 1 Support 6/21/2020 6/28/2020
Project Documentation and AsͲbuilts 6/28/2020 7/7/2020 Project Closure 7/7/2020 7/7/2020
Cisco BE6K Servers 5/21/2020 5/22/2020 2d
Update all Firmware 5/21/2020 5/21/2020
Vmware ESXi and vCenter Installation 5/22/2020 5/23/2020 CUCM Servers 5/23/2020 5/27/2020 5d
Licensing 5/23/2020 5/23/2020
High Availability 5/23/2020 5/23/2020
Dial plan 5/24/2020 5/24/2020
LDAP or AD Integration 5/25/2020 5/25/2020
End User Profiles 5/26/2020 5/26/2020
Media Resources (MOH,Transcode,MTP, etc.) 5/27/2020 5/27/2020 #19..
- 762 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 5
TFTP and Separate CFB Servers 5/27/2020 5/27/2020
Gateways 5/27/2020 5/27/2020
End User Features 5/28/2020 5/28/2020
Documentation 7/1/2020 7/7/2020
Task Name Start Finish Duration
Unity Connection Servers 5/23/2020 5/27/2020 5d
Licensing 5/23/2020 5/23/2016
High Availability 5/24/2020 5/24/2020
Call Handlers 5/25/2020 5/25/2020
CUCM Integration 5/25/2020 5/25/2020
COS/Templates 5/26/2020 5/26/2020
Users/Mailboxes 5/26/2020 5/26/2020
Single Inbox 5/27/2020 5/27/2020
Documentation 7/1/2020 7/7/2020
CUCM IM&P Servers 5/23/2020 5/27/2020 5d
Certificate Verification 5/23/2020 5/23/2020
Domains 5/23/2020 5/23/2020
Service Configuration 5/23/2020 5/23/2020
High Availability 5/23/2020 5/24/2020
Documentation 7/1/2020 7/7/2020
InformaCast Advanced Paging 5/23/2020 5/27/2020 5d
Licensing 5/23/2020 5/23/2020
High Availability 5/23/2020 5/23/2020
Paging Groups 5/24/2020 5/24/2020
Advanced Notifications 5/24/2020 5/24/2020
Documentation 7/1/2020 7/7/2020
ISR 4000 Routers 6/1/2020 6/7/2020 7d
Licensing 6/1/2020 6/1/2020
Voice Gateway configuration 6/1/2020 6/4/2020
Failover Path Testing 6/5/2020 6/5/2020
Integration to Existing On Premise Paging 6/6/2020 6/7/2020
#19..
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Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 6
Estimated Project Schedule (continued)
Task Name Start Finish Duration
Emergency Responder 5/23/2020 5/25/2020 7d
Licensing 5/23/2020 5/23/2020
High Availability 5/24/2020 5/24/2020
Subnet Configurations 5/24/2020 5/24/2020
CUCM Integration 5/24/2020 5/25/2020
PSAP Configuration 5/25/2020 5/25/2020
Documentation 7/1/2020 7/7/2020
Varify Call Accounting / Reporting 5/30/2020 5/30/2020 1d Project Go Live 6/21/2020 6/21/2020 0.5d
Test in/outbound dialing 6/21/2020 6/21/2020
Confirm inbound call flow 6/21/2020 6/21/2020
#19..
- 764 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 7
BIDDER’S QUALIFICATION
History:

Telcion Communications Group, based in Turlock, California, was founded in 2002.From the beginning, Telcion has been regionally focused, serving Northern California.Now in its 18th year, Telcion was created to concentrate on the growing Voice over IP trend and unified communications industry.Since then, Telcion has expanded its offerings to include video and data center solutions. To ensure the solutions we offer are on a stable and secure platform, we are also experts in the underlying technologies:switches and routers, security, wireless, virtualization, and structured cabling. Telcion was coͲfounded by Lance Reid and Darren Rodrigues.Lance has led the company as CEO for 18 years.
Telcion is headquartered in the heart of downtown Turlock on the corner of Main Street & Broadway. We occupy a 6,000sq ft office on the 2nd floor where our admin, sales, and network operations center are housed.We also have a warehouse & office in the industrial area west of Hwy 99 off of West Main Street which supports our structured cabling operations and project staging. x 18 years of dedicated service to California’s Central Valley x Our staff collectively has over 75 years of experience in design, engineering, installation, and support in telecommunications
Background and Experience:

Who We Are
x An IT company that specializes in voice, video, virtualization, and data center solutions x A team of highly qualified engineers and support professionals x A private employer based in the heart of California’s Central Valley What We Do
x Design, install, and support all aspects of our solutions x Help our clients achieve higher productivity and cost savings #19..
- 765 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 8
x Focus on superior service over the longest possible term x Forge partnerships with our technology partners and clients alike What We Believe
x Communication defines every business, nonͲprofit, and government entity. x Good internal communication facilitates teamwork; good external communication is the cornerstone of superior service.
x Our technology partnerships with Cisco, VMWare, and Nimble Storage form the bedrock of our business.Their product lines give the broadest possible range of options, from simple to complex, focused to robust.
We are successful when our client’s operations improve and they become more effective at what they do

Our Commitment
x We pledge to help our clients embrace new technologies so they can reap the cost savings and benefits
x We focus on delivering and installing projects on time and on budget x We strive to exceed customer expectations for service and support Our Expertise
x We have CCIE, CCNP, and PMP certified individuals on staff to ensure the right quality solution is developed for your organizational needs
x We design it right the first time, helping our customers avoid project overruns in time and budget
x We are an engineeringͲfocused company that is driven to quickly respond, assess, and troubleshoot any situation or networkͲdown emergency
The target client sweet spot for Telcion are organizations with 100Ͳ3000 users, headquartered in California, multiple sites, and have at least one dedicated IT person on staff.As a result, the majority of our clients fit within these parameters, with a few outliers. #19..
- 766 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 9
About 30% of our business comes from local government and education.The remaining 70% comes from commercial business.
Within the government and education sectors, we count major local clients (meaning we have completed multiple large projects and have longͲterm support agreements) such as the following:
x City of Modesto
x City of Stockton
x Stanislaus County IT Central (centralized IT services for various county agencies) x Stanislaus County Sheriff’s Office
x Salida Union School District
#19..
- 767 -
Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 10
References:

Stanislaus County IT Central
801 11th Street, Suite 4100, Modesto, Ca 95354
Paul Gibson, CIO
(209) 525Ͳ6529
[email protected]
4000+ Knowledge Workers
Telcion has been engaged with the County since 2009 in the county wide transition to VOIP.This was initially done in the core data center to support many of the smaller agencies, and then rolled out over the following years to larger departments.Today the system supports over 3,000 phones and includes multiple call centers and multiple redundancies.Telcion is engaged with an annual support agreement to for onͲgoing support of the system, and has been repeatedly engaged to provide software upgrades and new features.
Stanislaus County Sheriff Department
205 E. Hackett Ave, Modesto, CA
Scott Campbell, IT Director
(209) 567Ͳ4435
[email protected]
800+ Knowledge Workers
The Sheriff Department is one of Telcion’s longest standing customers, having engagements beginning in 2002. During the early years, we provided the solutions for all network and communication infrastructure, including all switching, routing, and firewalls.In 2009, Telcion migrated the entire department from a Fujitsu phone system to a Cisco VOIP solution across 10 sites, and started a 24/7 Premium Support Contract which is still in effect today. City of Stockton
400 East Main St. 4th Floor, Stockton, CA 95202
Erie Luces, Network Support Services Supervisor
(209) 937Ͳ7061
[email protected]
1000+ Knowledge Workers
The City awarded a 5Ͳyear contract to Telcion for a hosted Cisco VOIP solution.Telcion was awarded this 750k project in July of 2017 and completed it within about 6months for full operation during Q1 of 2018.The city already owned an aging Cisco telephony solution and had a desire to migrate to a cloud solution.Telcion proposed leveraging the existing Cisco solution in place, upgrade key hardware and software components, and migrate it to the Telcion Cloud so it could be operated as a fully managed hosted solution.This solution consisted of over 1000 phones and voicemail, 50+ contact center agents within various agencies, across dozens of sites.The City has a 5Ͳyear agreement with Telcion to manage and support this solution on a 24x7 basis.Telcion handles 30+ requests per month for various moves, adds, or changes.
#19..
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Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 11
City of Modesto
This project is notable because of its recent completion and sheer size.The City of Modesto awarded a network infrastructure upgrade project to Telcion in the fall of 2018.The project took nearly 18 months to complete (finished Jan of 2020) and involved the coordination of nearly 40 sites.The project had a value of $1.5mil and was completed within the budget.This upgrade consisted of the replacement of the entire network switching layer in the core and access layers throughout the City, new firewalls for the City and Police Departments, new wireless infrastructure, the implementation of network access control, software defined networking, new network monitoring tools, along with new fiber and wiring cleanup in some locations.The customer gave Telcion an A+ on this project and was very pleased with the outcomes.
United Health Centers
UHC awarded Telcion a 5 year hosted, Voice over IP, cloud solution that included a 50+ agent call center, 20 sites+ sites, and 800 phones.This project has a total value of 1.2mil over 5 years.The cloud migration was completed in the fall of 2019 after 6 months of project planning and preparation.UHC is expanding fast, and wanted a telephony solution that was completely hosted and managed by a vendor. They did not want to invest in the IT skills required to maintain the voice solution or have a dedicated voice engineer on their staff.Telcion has been fully engaged in the ongoing support of this solution since the cutover to the TelcionCloud.
San Joaquin General Hospital
This was a $1.2mil Cisco Voice over IP project awarded to Telcion in 2017.This was a new voice install – meaning SJGH was converting over from very antiquated phone technology (centrex) and migrating to VOIP.They had complex voice needs including a 35 agent call center, multiple redundancies, integration with the County phone system, E911 paging and notification, collaboration software, custom reports, etc.The most complex component of this project however was the 24x7 nature of the hospital and their Level 2 Trauma status within the region.Their voice services could not be interrupted.This project was completed in the summer of 2017.
Modesto City Schools VOIP Project
Telcion has been working with MCS on Voice over IP (VoIP) solution design and installations since 2006, when we first worked with the MCS district office to upgrade their voice system for ~150 users. In 2009, Telcion developed the plan for a comprehensive VoIP rollout to all 35 schools; this acted as a roadmap for implementation over the next several years, including the VoIP buildout, and the underlying networking infrastructure needed to support it, at 2 brand new schools.In 2014, we designed and provided the solution for a Core network upgrade, including moving all switches to Power over Ethernet Gigabit (to power all the phones), across all 35 schools. In 2015, we provided the solution and services to successfully migrate all 5Ͳdigit extensions off of the old Centrex service to an IP PBX solution for better management and feature set.

Finally, 2015 saw the beginning of a VoIP upgrade involving new voice gateways (routers) and new phones to all 35 schools and ~3,000 users, deployed in 3 phases. The final phase was completed in 2019.

The latest project was 3 phases of phone deployments to all school sites.Start date:Fall 2015 – Completion Date: Fall 2019.Budget – over $500k.Size – over 2000 phones to approximately 40 sites. #19..
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Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 12
Staff Assignment:

We have a staff of approximately 30 people, with 20+ individuals focused on the technical delivery of projects and onͲgoing support of our clients.Here are the individuals that would be assigned to your account.

Ryan Flud, VP Engineering
Ryan manages our engineering team, oversees all project implementations, and creates new tools and services for enhanced client support.In addition, Ryan is an experienced and seasoned voice engineer, having personally installed, upgraded, and managed dozens of our largest client installations over the last several years.Besides holding Cisco certifications for nearly 15 years, he has maintained his professional status of certified Project Manager from the Project Management Institute for over 10 years.He has 20+ years experience, 15 years at Telcion.

Cisco Certifications
CCNP
Other Certifications
Project Management Institute – PMP
Jeff Senger, Consulting Systems Engineer
Jeff is responsible for the design and architecture of complex projects.Jeff is our subject matter expert for collaboration solutions and various Cisco voice applications.Jeff spent 9 years as a voice engineer implementing and supporting Cisco voice solutions, and specializes in contact center deployments.He has passed the CCIE Voice written exam and is currently working to become a Voice CCIE.He has 20+ years experience, 14 years at Telcion.

Cisco Certifications
CCNPͲVoice
CCDA
Other Certifications
VMWare – VCP
Nimble Storage – NIOP
John Hinckley, Security and Wireless Engineer
John specializes in the deployment of security and wireless projects and works on project teams to support voice implementations.John understands both voice and wireless technologies which is a key skill set when deploying wireless IP Phones.John is our subject matter expert for security. He has 15+ years experience, 4 years at Telcion.

Cisco Certifications
CCNP – Security
CCNA – Wireless
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Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 13
Jeff Shear, Sr. Voice Engineer
Jeff is the Sr. Voice Engineer on this project and will be the primary implementation engineer for all of the voice applications.Jeff has been implementing Cisco voice solutions for over a decade.He has installed several dozen Cisco Unified Communication systems with multiͲthousand phone deployments and zero downtime tolerance.He has 15+ years experience, 4 years at Telcion.

Cisco Certifications
CCNPͲVoice
Other Certifications
RCDD
Blake Carpenter, Data Center Engineer
Blake is responsible for implementing data center and enterprise routing/switching solutions.He is a subject matter expert on data center solutions including the implementation of Cisco Unified Computing Systems, iSCSI and Fiber Channel storage networks, the Nexus switching platform, and enterprise VMware deployments.In addition, he has garnered significant experience in the deployment of cloud based data centers including hosted VOIP.He has over 10+ years experience deploying these type of solutions. Cisco Certifications
CCNP – Data Center
Other Certifications
VMWare – VCP
Nimble Storage – NIOP
Eric Grimm, Security Engineer
Eric specializes in the deployment and management of security and voice projects and works on project teams to support voice implementations.Eric has a Masters in CyberSecurity, and has managed security policies and projects in large banking environments and hospitals.He is a subject matter expert for security and has 15+ years experience, 1 years at Telcion.

Cisco Certifications
CCNA – Security
Other Certifications
Masters in CyberSecurity

#19..
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Telcion Communications Group
140 W. Main Street|Turlock, CA 95380
209.632.5700|www.telcion.com

January 13, 2021 14
Leo Ruelas, Voice Engineer
Leo specializes in the management and troubleshooting of voice and contact center projects and works on project teams to support voice implementations.Leo works with our clients to troubleshoot complex voice issues postͲ implementation.Prior to Telcion, he was the sole voice engineer for a 2,000 phone hospital in the central valley.

He has 10+ years experience, 1 year at Telcion.

Cisco Certifications
CCNP – Voice
Derek Whitmore, Cisco Voice Engineer
Derek is providing postͲcutover help desk support for our voice solutions.He is adept at determining the nature of the issue and either resolving the issue or escalating as needed for resolution.His primary role in this project will be in the support of helpdesk issues postͲcutover.
Cisco Certifications
CCNA
Jose Hernandez, Structured Cabling Services
Jose has over 20 years experience implementing structured cabling services including fiber and copper plants.Jose will be responsible for circuit crossͲconnects.
Certifications
BICSI
Panduit
Fluke
Lance Reid, CEO & Chief Solutions Architect
Besides managing the company, Lance works closely with clients to architect new solutions that solve specific client needs.Lance has been a Voice CCIE for over 12 years, and has been designing, installing, and supporting Cisco voice solutions since 2000.He has 25+ years experience, 18 years at Telcion.

Cisco Certifications
CCIE #14888 – Voice
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EXHIBIT 1A- CATEGORY OF SERVICES
Contractor should be prepared to demonstrate how they will provide standard and advanced information technology, telecommunications, imaging, homeland security technology.

Option A – County of Merced works with Telcion on an exclusive pre-sales basis to determine solution/products/scope and project/order is $10k or higher

CATEGORY HOW

SUPPLIED
%

DISCOUNT

OFF LIST
PRICE

1.0 Communications Services
Call Center Solutions (with ACD) Cisco 45%

Emergency Notification Solutions (Reverse
911)
Cisco 45%

Engineering/Consulting Services Cisco 10%

Integrated Voice Response (IVR) Cisco 45%

Voice over Internet Protocol (VOIP) Cisco 45%

Unified Messaging (UM) Cisco 45%

Long Distance Services (Switched, Dedicated)

Telecommunications Systems (PBX) Cisco 45%

Telephone Handsets Cisco 45%
#19..
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Voice Mail Solutions Cisco 45%

Wireless Voice Communication Services Cisco 45%

2.0 Application Systems
Development

Installation Solutions

Version Control Solutions

3.0 Infrastructure
Battery Backup Systems

Cabling Services Panduit/Berktek 20%

Energy Auditing and Management Solutions

4.0 Enterprise Mobility Solutions
Mobile Device Management Cisco/Meraki 45%

Mobile Devices (Tablets)

Mobile Applications

5.0 Maintenance Services Telcion 10%
#19..
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6.0 Network & Enterprise Security Solutions
Firewall & Virtual Private Network (VPN)
Solutions
Cisco 45%

Intrusion Detection/Prevention Solutions Cisco 45%

Network, Host & Enterprise Management
Solutions
Cisco 45%

Transport Solutions (PRI, MPLS, Super-trunks,
CO Business Lines, Optical, Satellite, Wireless)

Video Solutions Cisco 45%

Wireless Solutions (Wi-Fi) Cisco 45%

7.0 E-Government
Web Site Analytics

Web Site Content Management Solutions

Web Site Design, Development, Hosting
Services

Web Site Development Tools

Web Site Intranet Solutions

#19..
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Web Monitoring & Filtering Solutions Cisco 45%

Web Site Portal Solutions

8.0 Enterprise Systems
Virtualization (Servers) VMWare 10%

Virtual Desktop Infrastructure (VDI) VMWare 10%

Anti-Virus, Spam, Spyware Solutions Cisco 45%

Data Encryption Products & Services Cisco 45%

Helpdesk Solutions

Hosting Services and Applications (Cloud and
SaaS)
Cisco 30%

Radio Frequency Identification (RFID) Cisco 45%

Server, Storage & Data Management Products Cisco 45%

Telepresence/Video Conferencing Cisco 45%

9.0 Training Solutions Telcion 10%

10.0 Consulting Services Telcion 10%

#19..
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Option A – Project/order is $10k or less OR does not work with Telcion exclusively in presales design for product/scope.

CATEGORY HOW

SUPPLIED
%

DISCOUNT

OFF LIST
PRICE

1.0 Communications Services
Call Center Solutions (with ACD) Cisco 41%

Emergency Notification Solutions (Reverse
911)
Cisco 41%

Engineering/Consulting Services Cisco 10%

Integrated Voice Response (IVR) Cisco 41%

Voice over Internet Protocol (VOIP) Cisco 41%

Unified Messaging (UM) Cisco 41%

Long Distance Services (Switched, Dedicated)

Telecommunications Systems (PBX) Cisco 41%

Telephone Handsets Cisco 41%

#19..
- 778 -
Voice Mail Solutions Cisco 41%

Wireless Voice Communication Services Cisco 41%

2.0 Application Systems
Development

Installation Solutions

Version Control Solutions

3.0 Infrastructure
Battery Backup Systems

Cabling Services Panduit/Berktek 20%

Energy Auditing and Management Solutions

4.0 Enterprise Mobility Solutions
Mobile Device Management Cisco/Meraki 41%

Mobile Devices (Tablets)

Mobile Applications

5.0 Maintenance Services Telcion 10%

#19..
- 779 -

6.0 Network & Enterprise Security Solutions
Firewall & Virtual Private Network (VPN)
Solutions
Cisco 41%

Intrusion Detection/Prevention Solutions Cisco 41%

Network, Host & Enterprise Management
Solutions
Cisco 41%

Transport Solutions (PRI, MPLS, Super-trunks,
CO Business Lines, Optical, Satellite, Wireless)

Video Solutions Cisco 41%

Wireless Solutions (Wi-Fi) Cisco 41%

7.0 E-Government
Web Site Analytics

Web Site Content Management Solutions

Web Site Design, Development, Hosting
Services

Web Site Development Tools

Web Site Intranet Solutions

Web Monitoring & Filtering Solutions Cisco 45%
#19..
- 780 -

Web Site Portal Solutions

8.0 Enterprise Systems
Virtualization (Servers) VMWare 10%

Virtual Desktop Infrastructure (VDI) VMWare 10%

Anti-Virus, Spam, Spyware Solutions Cisco 41%

Data Encryption Products & Services Cisco 41%

Helpdesk Solutions

Hosting Services and Applications (Cloud and
SaaS)
Cisco 30%

Radio Frequency Identification (RFID) Cisco 41%

Server, Storage & Data Management Products Cisco 41%

Telepresence/Video Conferencing Cisco 41%

9.0 Training Solutions Telcion 10%

10.0 Consulting Services Telcion 10%

11.0 Other Goods and Services List Price Discount
#19..
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Cisco SmartNet Contracts
Cisco Cloud Services (Webex Calling/Webex etc.)
Labor: Project Manager
Labor: Systems Engineer CCVP VOICE
Labor: Systems Engineer CCIE
Labor: Systems Engineer LAN/WAN/WIRELESS
Labor: Systems Engineer Security
Labor: Systems Engineer Telepresense
Labor: Systems Engineer Training
Labor: Cabling (Team of 2)
Labor: Project Manager Cabling
Cisco
Cisco
$225
$225
$250
$225
$225
$225
$200
$120
$200
19%
25%
10%
10%
10%
10%
10%
10%
10%
10%
10%
#19..
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#19..
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#19..
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Criteria Calculated Points AMS.NET, Inc. AT&T NTT America Solutions, Inc Telcion Communications Group 1 Overall Responsiveness to the RFP 10 9 9.67 8.33 7.672 Comprehensiveness 30 28 28 25 23 3 Experience 20 19.33 18.67 18 15.33
4 Performance and History 10 9.33 9.67 9 8
5 Scope of Work Time Frame 10 9.33 9.67 7.33 96
Acceptance to the Terms and Conditions
of RFP 10 9.67 8.67 7.67 9
7 Pricing 10 9.67 8.67 8.67 8.33

94.33 93 84 80.33 Total Points
RFP #7370
#19..
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

May 6, 2025
Date: April 16, 2025
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: William Wong, Director of Utilities
SUBJECT: Sole Source Procurement of Two Internalift Screw Pumps CONTACT: Jeff Daniels, Wastewater Division Manager, [email protected], 209-577- 6255
DESCRIPTION:

Consider approving the purchase of two Internalift Screw Pumps from Evoqua Water Technologies, of Thomasville, GA, for a total amount not to exceed $3,411,840. (Funding Source:

Wastewater Fund Reserves)
STRATEGIC PLAN ELEMENT:

The recommended action supports the 2020-2025 City of Modesto Strategic Plan Initiatives, Goal D: Provide safe, efficient, and reliable infrastructure through proactive community investment, maintenance, and sustainability efforts.

BACKGROUND:

The Wastewater Division of the Utilities Department utilizes four Evoqua Water Technologies (Evoqua) Internalift screw pumps as part of the primary treatment process that is performed at the Regional Water Recycling Facility Sutter Campus. In 2021 Plant Operations & Maintenance staff determined that the pumps had reached the end of their useful service and must be replaced.

To ensure there was no disruption to the efficient operation of the facility, it was determined that two separate projects would be created to replace two pumps at a time.

On September 14, 2021, by Resolution 2021-368, Council approved the sole source purchase for the replacement of two (2) Internalift Screw Pumps at the Regional Water Recycling Facility (RWRF) Sutter Campus from Evoqua Water Technologies, of Thomasville, GA, for an estimated total cost of $1,787,560 plus $168,670 in contingency (if needed), for a total amount not to exceed $1,956,230 and amending the Fiscal Year 2021-22 Multi-Year Project budget in the amount of $946,355.

During the installation of the first two (2) pumps in 2023, there were issues with hardware and some coupling bolts that had sheared off. Once the issues were resolved and the installation and repairs were completed the pumps have since run trouble free. #20..
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City Council, May 6, 2025
Sole Source Procurement of Two Internalift Screw Pumps

Page 2 of 3 ends

DISCUSSION:

Evoqua Internalift screw pumps are proprietary equipment manufactured by Evoqua Water Technologies in Thomasville, GA, who is the only authorized source for replacement pumps, components and/or repair of the equipment. The pumps work in tandem with other equipment, including the upper support/thrust bearing and lower trunnion support structures, along with other ancillary systems. Additionally, oiling systems control strategies, soft stars, splash, and spill covers, mounting configurations and other related elements are all designed around the Evoqua pumps. Purchasing the new pumps from a different supplier will require replacing or reconfiguring all of these existing systems, which would have a significant financial and operational cost.

The scope of services in the proposal prepared by Evoqua is as follows:
- Two (2) New 96” Diameter Internalift Screw Pump Systems - Removal and Installation Services
- Disposal of the Existing Pump Bodies
- Payment and Performance Bonds
Modesto Municipal Code Section 8-3.204 generally requires all purchases, in excess of one hundred thousand dollars ($100,000) to follow formal bid procedures. However, MMC 8-3.204(b) provides that a purchase may be exempted from the City’s formal bidding requirement where the Purchasing Agency’s requirements can be met solely by a single article or process. Additionally, MMC 8-3.204(d) provides that a purchase may also be exempted where the Purchasing Manager, in her discretion, determines that a process other than the formal bid procedure set forth in Section 8-3.203 will result in a procurement for the City at the lowest possible cost commensurate with the desired quality. Here, Evoqua should be exempt from the formal bidding procedure in accordance with Modesto Municipal Code 8-3.204(b) since they are the only authorized source for replacement pumps, components and/or repair of the equipment. Additionally, Evoqua should be exempt from the formal bidding procedure in accordance with Modesto Municipal Code 8-

3.204(d) in that purchasing the new pumps from a different supplier will require replacing or reconfiguring the existing systems, which would have a significant financial and operational cost.

Therefore, this purchase qualifies for exemption from the formal bidding procedures.

FISCAL IMPACT:

Due to the increase in fuel and parts that will occur during the length of time it takes to complete the project, and because of the multiple issues with the installation of the previous two pumps, staff is asking for an additional 20% contingency.

The following Multi-Year Project account was created to house expenses associated with the administration, purchase, installation, and removal of two (2) existing Internalift screw pumps:
101439 – Screw Pumps Replacement
ANTICIPATED EXPENDITURES:

Procurement Agreement with Evoqua Water Technologies $2,611,435 20% Contingency $522,287
Estimated Taxes $278,118
TOTAL ANTICIPATED EXPENDITURES $3,411,840
A budget adjustment in the amount of $3,386,840 from Wastewater Reserves will be necessary to fully fund this project.
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City Council, May 6, 2025
Sole Source Procurement of Two Internalift Screw Pumps

Page 3 of 3 ends

COMMITTEE RECOMMENDATION:

This item was considered by the Economic Development Committee at the meeting held on April 7, 2025, where it was recommended that it be forwarded to Council.

RECOMMENDED COUNCIL ACTION:

Staff Recommendation:

Resolution approving the Sole Source purchase from Evoqua Water Technologies, Thomasville, GA, of two (2) Internalift Screw Pumps for an estimated cost of $2,889,553, plus $522,287 in contingency, if needed, for a total amount not to exceed $3,411,840, and authorizing the Purchasing Manager, or her designee, to issue a Purchase Order; and authorizing the Department Director or his designee to execute any Change Orders not to exceed 20% of the total purchase price.

Resolution amending the Fiscal Year 2024-25 Non-Capital Improvements Program budget to increase Project 101439 – Screw Pumps Replacement by $3,386,840, from $25,000, for a revised total amount not to exceed $3,411,840, in transfers, revenue, and discretionary expenditures, and authorizing the City Manager, or his designee, to implement the provisions of the resolution.

Approved by:

William Wong, Director of Utilities
Joseph P. Lopez, City Manager
Attachments:

1. Resolution – Purchase

2. Resolution – Amend Budget

3. Proposal

4. Sole Source Letter

5. Bid Waiver Approval

6. Levine Act Disclosure
#20..
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MODESTO CITY COUNCIL
RESOLUTION NO. 2025-XX

RESOLUTION APPROVING THE SOLE SOURCE PURCHASE FROM EVOQUA WATER TECHNOLOGIES, THOMASVILLE, GA, OF TWO (2) INTERNALIFT SCREW PUMPS FOR AN ESTIMATED COST OF $2,889,553, PLUS $522,287 IN

CONTINGENCY, IF NEEDED, FOR A TOTAL AMOUNT NOT TO EXCEED $3,411,840, AND AUTHORIZING THE PURCHASING MANAGER, OR HER DESIGNEE, TO ISSUE A PURCHASE ORDER; AND AUTHORIZING THE

DEPARTMENT DIRECTOR OR HIS DESIGNEE TO EXECUTE ANY CHANGE ORDERS NOT TO EXCEED 20% OF THE TOTAL PURCHASE PRICE
WHEREAS, the Wastewater Division of the Utilities Department utilizes four Evoqua Water Technologies (Evoqua) Internalift screw pumps as part of the primary treatment process that is performed at the Regional Water Recycling Facility (RWRF) Sutter Campus; and
WHEREAS, in 2021 Plant Operations & Maintenance staff determined that the pumps had reached the end of their useful service and must be replaced; and WHEREAS, on September 14, 2021, by Resolution 2021-368, Council approved the sole source purchase for the replacement of two Internalift Screw Pumps at the Regional Water Recycling Facility (RWRF) Sutter Campus from Evoqua Water Technologies, of Thomasville, GA, for an estimated total cost of $1,787,560 plus $168,670 in contingency (if needed), for a total amount not to exceed $1,956,230; and WHEREAS, Evoqua Internalift screw pumps are proprietary equipment manufactured by Evoqua Water Technologies in Thomasville, GA, who is the only authorized source for replacement pumps, components and/or repair of the equipment; and
WHEREAS, the Modesto Municipal Code Section 8-3.204(b) provides that a purchase may be exempted from the City’s formal bidding requirement where the Purchasing Agency’s requirements can be met solely by a single article or process; and #20..
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05/06/25/Utilities/JDaniels/Item # 2 2025-XXX
WHEREAS, MMC 8-3.204(d) provides that a purchase may also be exempted where the Purchasing Manager, in her discretion, determines that a process other than the formal bid procedure set forth in Section 8-3.203 will result in a procurement for the City at the lowest possible cost commensurate with the desired quality; and WHEREAS, Evoqua should be exempt from the formal bidding procedure in accordance with Modesto Municipal Code 8-3.204(b) since they are the only authorized source for replacement pumps, components and/or repair of the equipment and in that purchasing the new pumps from a different supplier would require replacing or reconfiguring the existing systems, at a significant financial and operational cost; and WHEREAS, pursuant to Graydon v. Pasadena Redevelopment Agency (1980) 104 Cal. App. 3d 634, the City Council finds that competitively bidding the installation of the pumps separately from the purchase would not produce an advantage for the City because Equova is the other authorized source for the replacement pumps and must be the installer of the pumps in order to maintain manufacturer warranties, and the advertisement for competitive bid would thus be undesirable.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the sole source purchase from Evoqua Water Technologies, Thomasville, GA, of two Internalift Screw Pumps for an estimated cost of $2,889,553, plus $522,287 in contingency, if needed, for a total amount not to exceed $3,411,840.

BE IT FURTHER RESOLVED that the Purchasing Manager, or her designee, is hereby authorized to issue a purchase order; and authorizing the Department Director or his designee to execute any change orders not to exceed 20% of the total purchase price. #20..
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05/06/25/Utilities/JDaniels/Item # 3 2025-XXX
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 6th day of May 2025, by ___________, who moved its adoption, which motion being duly seconded by ___________, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: _________________________________

DIANE NAYERES-PEREZ, CMC,
City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ________________________________
JOSE M. SANCHEZ, City Attorney
#20..
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1 2025-

MODESTO CITY COUNCIL
RESOLUTION NO. 2025-
RESOLUTION AMENDING THE FISCAL YEAR 2024-2025 NON-CAPITAL IMPROVEMENTS PROGRAM BUDGET TO INCREASE PROJECT 101439 – SCREW PUMPS REPLACEMENT BY $3,386,840, FROM $25,000, FOR A REVISED TOTAL AMOUNT NOT TO EXCEED $3,411,840, IN TRANSFERS,

REVENUE, AND DISCRETIONARY EXPENDITURES, AND AUTHORIZING

THE CITY MANAGER, OR HIS DESIGNEE, TO IMPLEMENT THE

PROVISIONS OF THIS RESOLUTION
WHEREAS, the Fiscal Year 2024-2025 Non-Capital Improvement Budget must be amended to increase Project 101439 – Screw Pumps Replacement, by a total amount of $3,386,840, to establish transfers, recognize revenue, and increase discretionary expenditures.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves amending the Fiscal Year 2024-2025 Non-Capital Improvements Program budget to increase Project 101439 – Screw Pumps Replacement by $3,386,840, from $250,000, for a revised total amount not to exceed $3,411,840, in transfers, revenue, and discretionary expenditures.

BE IT FURTHER RESOLVED that the City Manager, or his designee, is hereby authorized to implement the provisions of this resolution. .
#20..
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2 2025-
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 6th of May 2025, 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
#20..
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FIRM PROPOSAL

PW SUTTER PRIMARY

TREATMENT PLANT

MODESTO, CA / USA
INTERNALIFT® SCREW PUMP
Quotation No: 00663589-A2 – 3/10/2025
Questions related to this Proposal should be
directed to Evoqua’s area sales representative:

SALES REPRESENTATIVE
Simon Morris
JBI Water & Wastewater Equipment
Elk Grove, CA
Phone: (916) 642.5500
Email: [email protected]
#20..
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Quotation No.: 663589-A2

Page 2 of 17 ends

Evoqua Water Technologies LLC
To: Maintenance Supervisor
Owner: City of Modesto, CA

1. SUMMARY
Evoqua Water Technologies LLC (Evoqua) proposes to furnish the equipment specified in this Quotation in accordance with the scope of supply described in this quotation and subject to the Clarifications/Exceptions and Standard Terms of Sale stated herein.

The information in this quotation is confidential and/or proprietary and has been prepared solely for the recipient’s use in considering the purchase of the equipment and/or services described herein. Transmission of all or any part of this information to others, or use by the recipient, for other purposes is expressly prohibited without Evoqua’s prior written consent. Use of this proposal to meet public record requirements is acceptable.

ITEM & DESCRIPTION PRICE
Item A: Two (2) New 96” Dia. Internalift Screw Pump Bodies $2,014,797 USD Item B: Removal & Installation Services
Item C: Disposal of Existing Pump Bodies
Item D: Payment & Performance Bonds
Total….
$ 551,546 USD
$ 12,000 USD
$ 33,092 USD
$ 2,611,435 USD
Evoqua’s price includes only the specific items detailed in this quotation. Items not specifically identified herein are to be furnished by others. Please refer to the excluded items in Section 4 of this quotation for a list of items to be furnished by others.

A. OPTIONS: An order for items quoted as an extra cost option, if any, will be accepted only when included with the basic equipment order.

B. FREIGHT: Pricing is FOB shipping point with standard freight allowed to the job site. Our price does not include any costs for unloading, transporting on the site, phased shipments or storage unless field services are purchased.

C. QUOTATION VALIDITY: This quotation is valid for a period of ninety (90) days from the date of this proposal unless extended in writing by Evoqua. Due to current raw material price fluctuation, Evoqua reserves the right to re-quote the equipment proposed herein after that time.

The prices quoted herein are based on the current tariff rates, duties, government charges, and trade regulations as of the date of this quote. If any new tariffs, duties, taxes, or similar charges are imposed, or any existing tariffs, duties, or charges are increased or modified by any government or regulatory authority (collectively, "Tariff Changes"), and such Tariff Changes result in an increase in the cost of goods, Evoqua reserves the right to adjust the pricing of the affected goods to reflect the increased #20..
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costs. Evoqua is not obligated to deliver the goods and/or services until an agreement on the new price has been reached.

Due to volatility in material costs, prices quoted in this proposal will be adjusted to reflect changes in the Metal and Metal Products Index (MMPI) published by the U.S. Department of Labor, Bureau of Labor Statistics. The most recent published MMPI is 308.9(P) for January 2025 If the MMPI exceeds 314 at the time the Equipment is released for manufacture, then the price will be increased by the same percentage as the MMPI exceeds 314.

D. FIELD SERVICES: Evoqua’s pricing includes the services of a factory field service technician for checking the installed equipment, alignment help, start-up services and instruction of Owner’s personnel.

Category Trips Days on Site
Pump #1 1 3
Pump #2 1 3
Total 2 6
E. SERVICE MANUALS: Our pricing includes an electronic version of the operation and maintenance (O&M) manual as an Adobe PDF file format only. If requested, Evoqua will supply hard copies of the service manual at the customer’s expense. Drawings will be supplied in an unchangeable PDF file format only. The rights to the content of Evoqua O&M manuals and drawings belong solely to Evoqua and Evoqua reserves the right to make changes to content at any time.

F. PAYMENT AND PRICE TERMS: The terms of payment are net 30 in accordance with the following milestones:

Equipment
 35% on order.
 40% on drawing submittal approval.
 15% on delivery of equipment.
 10% on acceptance of installed equipment.

Installation Services
 10% with signed agreement.
 90% progressive payments as job progresses.

G. CANCELLATION POLICY: If Evoqua is issued an order and the Buyer cancels or suspends its order for any reason other than Evoqua's breach, the Buyer shall promptly pay Evoqua for work performed prior to cancellation or suspension and any other costs incurred by Evoqua as a result of such cancellation or suspension. At a minimum, cancellation after executed contract will result in a cancellation fee of 10% of the total order value.

Evoqua’s prices are exclusive of any taxes. If this project is not subject to sales or use tax, please issue a Tax-Exempt Certificate with any ensuing purchase order (P.O.). If applicable, please provide a copy of payment bond information with the P.O. With no exemption or if this #20..
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project is subject to sales or use tax, the Purchaser will be invoiced for taxes at the then-current rate of sales, use or other tax for the jobsite location.

2. DRAWING AND SHIPPING INFORMATION
Evoqua shall furnish shop drawing submittals and equipment per the following project schedule:

Submittal Drawings: Within 10 to 12 weeks from the date of final agreement by both parties. (Executed contract)
Submittal Drawing Reviews/Approvals: Within 4 weeks from Evoqua’s delivery of Submittal drawings.

Shipment of Equipment: Within 32 to 34 weeks* after executed release for manufacturing (submittal approval) for pump one. Pump #2 will ship in accordance with agreed upon schedule. **  Shipment of 1st Pump is planned for April 2026
 **Evoqua acknowledges the need by the city for a 60-day commissioning period.

Evoqua has provided typical standard times and shipment dates. Actual times will be provided upon receipt of a Purchase Order based upon current backlog. Evoqua will work closely with the General Contractor and/or Engineer to provide delivery dates to meet the overall project schedule as closely as possible.

If Submittal Drawing Reviews/Approvals are not received by Evoqua in accordance with the project schedule noted above, Evoqua shall be entitled to a reasonable extension of the Shipment of Equipment times and/or a reasonable increase in the contract price to cover costs incurred because of Submittal Drawing Review/Approval delays unless the delay is the fault of Evoqua

3. EQUIPMENT SCOPE
The following equipment and services are included in Evoqua’s scope of work:

Item A:

Two (2) 96” Diameter x 38’ – 3 5/8” long replacement Internalift Screw Pump, capable of delivering influent water at a rate of 18,750 GPM at a hydraulic lift of 23.48’. Pump is installed at a 45-degree incline. Pump will include:

1. New pump body of carbon steel construction, complete with carbon steel flights and drive shaft. Pump cylinder wall thickness is 0.5” minimum

2. New Wear Ring Assembly with Pilot Blocks and Saddle Plates

3. New EWT standard Two Piece 316 Stainless Steel Upper Splash Guard

4. New Lower Bearing Assembly, to include 4 roller assemblies, two (2) roller carriages, sole plate and guard. Base plate, and carriages to be carbon steel painted, guard to be 316 stainless steel materials of construction.

5. New upper bearing assembly with special lower oil seal design. #20..
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6. Interior surfaces shall be near white blast cleaned (SSPC-SP10) prior to fabrication and then after fabrication/assembly, completely coated using a two-pass flow coat process with Tnemec 46-465HB Tnemecol Coal Tar Epoxy at 8-mil DFT. Color is Black

7. Exterior surfaces shall be near white blast cleaned (SSPC-SP10) and coated with a three coat Axalta Coating System. Final Coat Color to be Shadow Green Item B
Removal & Installation Field Services, each pump
 Removal of existing 96” Diameter Internalift Screw Pump. o Remove any supports necessary for pump removal from pit o Remove coupling guard
o Disconnect Para-flex coupling
o After pump has been dewatered, disconnect power from drive unit. o Remove lower bearing guard
o Remove nuts on the upper splash guard anchor bolts
o Using the appropriate rigging connect to pump with crane o Remove the base bolts on the upper bearing assembly
o Remove existing pump from pit. Either load on truck for disposal or set pump on dunnage for future disposal (Disposal is responsibility of Evoqua if purchased) o Remove lower carriages, roller assemblies and sole plate from pit.  Installation of new 96” Internalift screw pump.
o Using the appropriate rigging the new pump will be placed into pit. o Connect upper bearing to drive sole plate.
o Reconnect para-flex coupling between upper bearing and gear reducer o Align coupling and pump system.
o Install upper splash guard and wear ring guard.
o Rotate pump to confirm alignment
o Start-up
Crane services, all tools, safety equipment, loading and unloading of equipment included. Work hours by EWT at the site shall be as determined by EWT. Evoqua’s normal work schedule is 10 hours a day, 7 days a week until. The purchaser shall not define working hours, number of workdays per week or prohibit Evoqua from working evenings, weekends, holidays, etc., when deemed advisable by Evoqua water Technologies. Prevailing Wage Rates are included.

Preliminary Mobilization Schedule
 Mobilization #1 – Evoqua will mobilize to the project site to remove and dispose of Pump #1.

Prior to Evoqua’s arrival the city will have removed the motor and gearbox. The existing sole plate is to be repainted by the city.
 Mobilization #2 – **Approximately 3-4 weeks after Mobilization #1. During this mobilization Evoqua will install the new screw pump. The city will have the reducer and motor re-installed.

Start-up of the screw pump will take place and there will be a 60-day commissioning period.  Mobilization #3 - Evoqua will mobilize to the project site to remove and dispose of Pump #4. Prior to Evoqua’s arrival the city will have removed the motor and gearbox. The existing sole plate is to be repainted by the city.
 Mobilization #4 – **Approximately 3-4 weeks after Mobilization #3. During this mobilization Evoqua will install the new screw pump. The city will have the reducer and motor re-installed.

Start-up of the screw pump will take place and there will be a 60-day commissioning period. #20..
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**Note: time periods between mobilizations are a minimum but could be extended based upon availability of personnel.

Evoqua’s price is based on the following surface protection, unless stated otherwise in this quotation:

A. Shafting and exposed machined surfaces: solvent wiping, followed by one (1) coat of Evoqua’s standard shop preservative.

B. Wood, nonferrous materials, stainless steel, and galvanized surfaces: unpainted.

C. Drive units and controls: manufacturer’s standard.

Touch-up and all additional coats shall be furnished and applied by others at the site.

Prices are based on paints and surface preparations as outlined in this quotation. In the event an alternate paint system is selected, purchaser’s order must advise of its selection. Evoqua will, at its sole discretion, either adjust its price as necessary to comply or ship the material unpainted if compliance is not possible due to price considerations, application problems or environmental controls.

Evoqua does not guarantee primer’s compatibility with purchaser’s coating system unless approved by the coating system manufacturer. Primers will only protect for a minimal amount of time, usually thirty (30) days.

Specific information should be obtained from coating system manufacturer.

4. EXCLUDED ITEMS
The price from Evoqua includes only those items listed in this Quotation. The items listed below are excluded:
 Anchors (Existing to be reused)
 Drive System (Existing to be reused)
 Lubrication system (Existing to be reused)
 Lubricants of any kind.
 Dewatering of the pit, and/or temporary bypass pumping if required.  Electrical, hydraulic, or pneumatic controls.
 Wiring of motors or controls, control panels, or panel supports.  Piping, valves, wall sleeves, gates, drains, weirs, baffles.  Floor grating, stairways, ladders, platforms, handrailing.  Tools or spare parts.
 Modifications to existing equipment or structures.
 Supervisory services; laboratory, shop, or field testing.  Underwriters Laboratory inspection of electrical controls.  Special written process, performance or extended mechanical warranties.  Payment, Performance or any other types of bonds.
 Any items / equipment not specifically listed in this proposal. #20..
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5. CLARIFICATIONS/EXCEPTIONS
The equipment specified herein shall conform to the specification sections referenced in Section 1 of Evoqua’s Quotation to the extent they are technically applicable to Evoqua’s scope of supply as described in this Quotation and subject to the following clarifications:

Article, Section Clarifications/Proposed Modifications
General Two additional mobilizations are included in the removal and installation pricing to facilitate the site’s rehabilitation / repainting of the existing drive equipment. Rehabilitation, repainting and any work associated with the refurbishment of the drive packages is by others and not a part of Evoqua’s scope of supply.

General The existing low speed coupling that connects the reducer to the upper bearing assembly is the responsibility of the end user. Removal of the existing flanges from the existing upper bearing assemblies is not part of Evoqua’s scope.

General It is Evoqua’s intent that the existing anchorage is to be reused. If existing anchorage is deemed unusable, new epoxy adhesive style anchors would be supplied.

General The upper bearing assembly is attached to the drive shaft at the manufacturing facility and connecting hardware is torqued to Evoqua specifications and documented by our in-house quality control department. A document stating all torque requirements were verified during the assembly process can be supplied.

General Evoqua understands that the City of Modesto must always have three pumps operational and as such, only one pump can be taken out of service at a time.

General EWT Standard upper splash guard is supplied. No additional vapor covers are included. Small field modifications may be required for fit of the guard to the existing concrete structure.

General Grout underneath the lower bearing assembly will be removed and replaced by Evoqua installation crew only if installation services are purchased.

General The Internalift screw pumps are manufactured in the USA at the Thomasville, GA manufacturing facility.

General Estimated pump shipping weight is 48,000 lbs.

6. ADDITIONAL FIELD SERVICES
Should the Purchaser feel, that additional services will be required, they can be purchased from Evoqua.

Additional services may be purchased at the per diem rate stated below.

Evoqua’s price does not include service of a factory field service technician during the time of installation of the equipment items.

In the event Purchaser wishes to videotape the Evoqua field service personnel during start-up and/or field service, Purchaser must execute Evoqua’s standard “Videotape Agreement” in which the Purchaser shall #20..
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expressly waive any claim against Evoqua, for injury or damage caused by inaccuracies or errors in such videotape(s) and acknowledge that such videotaping is done by Purchaser at its sole risk.

TERMS GOVERNING FIELD SERVICES: Services of a factory field service technician to inspect installation and/or first operation of the products specified in the quotation can be furnished by Evoqua at the following rates:

A. Supervision or consultation of a process service technician within the continental limits of the United States: $1,500 USD per eight (8) hour day plus expenses, Monday through Friday inclusive.

B. Supervision or inspection of a field service technician within the continental limits of the United States: $1,500 USD per eight (8) hour day plus expenses, Monday through Friday inclusive. Overtime Monday through Friday and Saturday work is charged at time and one-half. Time worked on Sunday will be charged double time; time worked on U.S. Holidays will be charged triple time.

C. Traveling, living and incidental expenses at cost, including shipping charges on tools and other equipment which the factory field service technician has shipped to the construction site.

D. Travel time will be charged to and from Purchaser's construction site, and weekend or holiday travel request or required by Purchaser will be charged at the overtime rates.

E. Rescheduling or cancellation of a field service trip once booked will incur the greater of either a $1,700 USD cancellation or re-scheduling charge, or actual costs.

Rates shown above apply only to additional services performed within twelve (12) months from the date of Quotation. Additional services performed after twelve (12) months from the date of Quotation shall be subject to Evoqua’s current rates at the time such service is provided. Except for the direct acts or omissions of the factory field service technician, the responsibility for the installation and/or first operation shall be Purchaser’s. Evoqua will assume responsibility for workmen’s compensation coverage of Evoqua employees only and will provide umbrella liability coverage during installation. All other insurance coverage and necessary materials to accomplish installation shall be provided by Purchaser.

Evoqua’s standard terms and conditions, including without limitation Evoqua’s warranty obligations in Article 7 govern the purchase and sale of equipment, products, and related services, referred to in Evoqua’s proposal. Evoqua’s offer or acceptance is expressly conditioned on Buyer’s assent to these terms. Evoqua rejects all additional or different terms in any of Buyer’s forms or documents.
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QUOTATION SUBMITTED BY EVOQUA WATER TECHNOLOGIES LLC
Signature below indicates acceptance of this quotation including the Standard Terms of Sale attached hereto and will act as the purchase order document between Evoqua Water Technologies LLC, the Seller, and the Buyer. The Standard terms of Sale shall form the complete and only set of terms for this order.

Accepted by Buyer: Acknowledged by Seller:

Evoqua Water Technologies LLC
Company Company
Printed Name Printed Name
Title Title
Signature Signature
Date Date
Evoqua Water Technologies LLC
N19 W23993 Ridgeview Pkwy, Suite 200
Waukesha, WI 53188
Billing Address Address
Shipping Address
Please submit the signed proposal to [email protected] along with the Billing Address, Shipping Address, Tax-Exempt Certificate, and a Copy of Payment Bond. It is clarified that the purchase order price does not include sales tax and that sales tax is to be added to the sale price unless the Seller receives a Tax-Exempt Certificate or Resale Certificate. #20..
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STANDARD TERMS OF SALE

1. Applicable Terms. These terms govern the purchase and sale of equipment, products, related services, leased products, and media goods if any (collectively herein "Work"), referred to in Seller’s proposal ("Seller’s Documentation"). Whether these terms are included in an offer or an acceptance by Seller, such offer or acceptance is expressly conditioned on Buyer’s assent to these terms. Seller rejects all additional or different terms in any of Buyer’s forms or documents.

2. Payment. Buyer shall pay Seller the full purchase price as set forth in Seller’s Documentation. Unless Seller’s Documentation specifically provides otherwise, freight, storage, insurance and all taxes, levies, duties, tariffs, permits or license fees or other governmental charges relating to the Work or any incremental increases thereto shall be paid by Buyer. If Seller is required to pay any such charges, Buyer shall immediately reimburse Seller. If Buyer claims a tax or other exemption or direct payment permit, it shall provide Seller with a valid exemption certificate or permit and indemnify, defend and hold Seller harmless from any taxes, costs and penalties arising out of same. All payments are due within thirty (30) days after receipt of invoice. Buyer shall pay interest on all late payments not received by the due date. The Buyer shall be charged the lesser rate of 1 ½% interest per month or the maximum interest rate permissible under applicable law, calculated daily and compounded monthly. Buyer shall also reimburse Seller for all costs incurred in collecting amounts due but unpaid, including without limitation, collections fees and attorneys’ fees. All orders are subject to credit approval by Seller. Back charges without Seller’s prior written approval shall not be accepted.

3. Delivery. Delivery of the Work shall be in material compliance with the schedule in Seller’s Documentation.

Unless Seller’s Documentation provides otherwise, delivery terms are FOB Shipping Point, or for international orders, ExWorks Seller’s factory (INCO™ Terms 2020). Title to all Work shall pass upon receipt of payment for the Work under the respective invoice. Unless otherwise agreed to in writing by Seller, shipping dates are approximate only and Seller shall not be liable for any loss or expense (consequential or otherwise) incurred by Buyer or Buyer’s customer if Seller fails to meet the specified delivery schedule.

4. Ownership of Materials and Licenses. All devices, designs (including drawings, plans and specifications), estimates, prices, notes, electronic data, software, and other information prepared or disclosed by Seller, and all related intellectual property rights, shall remain Seller’s property. Seller grants Buyer a non-exclusive, non-transferable license to use any written material solely for Buyer’s use of the Work. Buyer shall not disclose any such material to third parties without Seller’s prior written consent. Buyer grants Seller a nonexclusive, non-transferable license to use Buyer’s name and logo for marketing purposes, including but not limited to, press releases, marketing and promotional materials, and web site content.

5. Changes. Neither party shall implement any changes in the scope of Work described in Seller’s Documentation without a mutually agreed upon change order. Any change to the scope of the Work, delivery schedule for the Work, any Force Majeure Event, any law, rule, regulation, order, code, standard or requirement which requires any change hereunder shall entitle Seller to an equitable adjustment in the price and time of performance. If Buyer requests a proposal for a change in the Work from Seller and subsequently elects not to proceed with the change, a change order shall be issued to reimburse Seller for reasonable costs incurred for estimating services, design services, and services involved in the preparation of proposed changes.

6. Force Majeure Event. Neither Buyer nor Seller shall have any liability for any breach or delay (except for breach of payment obligations) caused by a Force Majeure Event. If a Force Majeure Event exceeds six (6) months in duration, the Seller shall have the right to terminate the Agreement without liability, upon fifteen (15) days written notice to Buyer, and shall be entitled to payment, including overhead and profit, for work performed prior to the date of termination. “Force Majeure Event” shall mean events or circumstances that are beyond the affected party’s control and could not reasonably have been easily avoided or overcome by the affected party and are not substantially attributable to the other party. Force Majeure Event may include, but is not limited to, the following circumstances or events: war, act of foreign enemies, terrorism, riot, strike, or lockout by persons other than by Seller or its sub-suppliers, natural catastrophes, (with respect to on-site work) unusual weather conditions, epidemic, pandemic, communicable disease outbreak, quarantines, national emergency, or state or local order.

7. Warranty. Subject to the following sentence, Seller warrants to Buyer that the (i) Work shall materially conform to the description in Seller’s Documentation and shall be free from defects in material and workmanship and (ii) the Services shall be performed in a timely and workmanlike manner. Determination of suitability of #20..
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treated water for any use by Buyer shall be the sole and exclusive responsibility of Buyer, and Seller disclaims any warranty regarding such suitability. The foregoing warranty shall not apply to any Work that is specified or otherwise demanded by Buyer and is not manufactured or selected by Seller, as to which (i) Seller hereby assigns to Buyer, to the extent assignable, any warranties made to Seller and (ii) Seller shall have no other liability to Buyer under warranty, tort or any other legal theory. The Seller warrants the Work, or any components thereof, through the earlier of (i) eighteen (18) months from delivery of the Work, or (ii) twelve (12) months from Buyer’s initial operation of the Work, or in the case of services performed as part of the Work, ninety (90) days from the performance of the services (the “Warranty Period”). If Buyer gives Seller prompt written notice of breach of this warranty within the Warranty Period, Seller shall, at its sole option and as Buyer’s sole and exclusive remedy, repair or replace the subject parts, re-perform the Service or refund the purchase price. Unless otherwise agreed to in writing by Seller, (i) Buyer shall be responsible for any labor required to gain access to the Work so that Seller can assess the available remedies and (ii) Buyer shall be responsible for all costs of installation of repaired or replaced Work. If Seller determines that any claimed breach is not, in fact, covered by this warranty, Buyer shall pay Seller its then customary charges for any repair or replacement made by Seller. Seller’s warranty is conditioned on Buyer’s (i) operating and maintaining the Work in accordance with Seller’s instructions, (ii) not making any unauthorized repairs or alterations, and (iii) not being in default of any payment obligation to Seller. Seller’s warranty does not cover (i) damage caused by chemical action or abrasive material, improper thermal or electrical capacity, misuse or improper installation (unless installed by Seller) and (ii) media goods (such as, but not limited to, resin, membranes, or granular activated carbon media) once media goods are installed. THE WARRANTIES SET FORTH IN THIS SECTION ARE THE SELLER’S SOLE AND EXCLUSIVE WARRANTIES AND ARE SUBJECT TO THE LIMITATION OF LIABILITY PROVISION BELOW. SELLER MAKES NO OTHER WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR PURPOSE.

8. Indemnity. Seller shall indemnify, defend, and hold Buyer harmless from any claim, cause of action, or liability incurred by Buyer as a result of third-party claims for personal injury, death, or damage to tangible property, to the extent caused by Seller's negligence. Seller shall have the sole authority to direct the defense of and settle any indemnified claim. Seller’s indemnification is conditioned on Buyer (i) promptly notifying Seller of any claim, and (ii) providing reasonable cooperation in the defense of any claim.

9. Assignment. Neither party may assign this Agreement, in whole or in part, nor any rights or obligations hereunder without the prior written consent of the other party; provided, however, the Seller may assign its rights and obligations under these terms to its affiliates or in connection with the sale or transfer of the Seller’s business, and Seller may grant a security interest in the Agreement and/or assign proceeds of the agreement without Buyer’s consent.

10. Termination. Either party may, in addition to any other available remedy, terminate this agreement for a material breach upon issuance of a written notice of the breach and expiration of a thirty (30) day cure period.

In the event of (i) a voluntary or involuntary petition in bankruptcy, (ii) an assignment for the benefit of a creditor, or (iii) a receivership, liquidation, or dissolution, Seller may terminate the agreement immediately, in addition to seeking any other available remedy. If Buyer suspends an order without a change order for ninety (90) or more days, Seller may thereafter terminate this Agreement without liability, upon fifteen (15) days written notice to Buyer, and shall be entitled to payment for work performed, whether delivered or undelivered, prior to the date of termination.

11. Disputes. In the event of any claim, dispute, or controversy arising out of or relating in any way to this Agreement (collectively, a “Claim”), Seller and Buyer shall first negotiate in good faith in an effort to resolve the Claim. If, despite good faith efforts, the parties are unable to resolve a Claim through negotiations, venue for any legal action related to the Claim shall be in the Stanislaus County Superior Court or the Federal District Court for the Eastern District of California. This Agreement and any Claim shall be governed by the laws of the State of California, without giving effect to the choice of law principles thereof. #20..
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12. Export Compliance. All items, and technologies, software, and work products are controlled by the U.S.

Government and authorized for export only to the country of ultimate destination for use by the ultimate consignee or end-user(s) herein identified. They may not be resold, transferred, or otherwise disposed of, to any other country or to any person other than the authorized ultimate consignee or end-user(s), either in their original form or after being incorporated into other items, without first obtaining approval from the U.S. government or as otherwise authorized by U.S. law and regulations. Any diversion contrary to U.S. law is prohibited. Buyer acknowledges that Seller is required to comply with applicable export laws and regulations relating to the sale, exportation, transfer, assignment, disposal, and usage of the Work provided under this Agreement, including any export license requirements. Buyer agrees that such Work shall not at any time directly or indirectly be used, exported, sold, transferred, assigned, or otherwise disposed of in a manner which will result in non-compliance with such applicable export laws and regulations. It shall be a condition of the continuing performance by Seller of its obligations hereunder that compliance with such export laws and regulations be maintained at all times. BUYER AGREES TO INDEMNIFY AND HOLD SELLER HARMLESS FROM ANY AND ALL COSTS, LIABILITIES, PENALTIES, SANCTIONS AND FINES RELATED TO NONCOMPLIANCE WITH APPLICABLE EXPORT LAWS AND REGULATIONS.

13. LIMITATION OF LIABILITY. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY, SELLER

SHALL NOT BE LIABLE FOR
ANY CONSEQUENTIAL, INCIDENTAL, SPECIAL, PUNITIVE OR OTHER INDIRECT DAMAGES. EXCEPT FOR SELLER’S INDEMNIFICATION OBLIGATIONS, SELLER’S GROSS NEGLIGENCE AND WILLFUL MISCONDUCT WHICH SHALL NOT BE SUBJECT TO THIS PROVISION, SELLER’S TOTAL LIABILITY ARISING AT ANY TIME FROM THE SALE OR USE OF THE WORK, INCLUDING WITHOUT LIMITATION ANY LIABILITY FOR ALL WARRANTY CLAIMS OR FOR ANY BREACH OR FAILURE TO PERFORM ANY OBLIGATION UNDER THE AGREEMENT, SHALL NOT EXCEED THE PURCHASE PRICE PAID FOR THE WORK. THESE LIMITATIONS APPLY WHETHER THE LIABILITY IS BASED ON CONTRACT, TORT, STRICT LIABILITY OR ANY OTHER THEORY.

14. Miscellaneous. These terms, together with any related Contract Documents issued or signed by the Seller, comprise the complete and exclusive statement of the agreement between the parties (the “Agreement”) and supersede any terms contained in Buyer’s documents, unless separately signed by Seller. No part of the Agreement may be changed or cancelled except by a written document signed by Seller and Buyer. No course of dealing or performance, usage of trade or failure to enforce any term shall be used to modify the Agreement. To the extent the Agreement is considered a subcontract under Buyer’s prime contract with an agency of the United States government, in case of Federal Acquisition Regulations (FARs) flow down terms, Seller will be in compliance with Section 44.403 of the FAR relating to commercial items and those additional clauses as specifically listed in 52.244-6, Subcontracts for Commercial Items (OCT 2014). If any of these terms is unenforceable, such term shall be limited only to the extent necessary to make it enforceable, and all other terms shall remain in full force and effect. The Agreement shall be governed by the laws of the Commonwealth of Pennsylvania without regard to its conflict of laws provisions. Both Buyer and Seller reject the applicability of the United Nations Convention on Contracts for the international sales of goods to the relationship between the parties and to all transactions arising from said relationship.

15. Bonds. The Seller shall furnish two (2) good and sufficient bonds. These bonds shall be in the amount and for the purpose specified below. They shall be surety bonds issued by corporations duly and legally licensed to transact business in the State of California. They shall be issued at the expense of Seller, and shall be maintained by him or her at his or her expense during the entire life of the contract. All surety companies shall be approved by the Buyer.

One (1) bond shall be in the amount of 100% of the contract price and shall guarantee faithful performance of the contract and insure the Buyer during the life of the contract.

One (1) bond shall be in the amount of 100% of the contract price and shall secure the obligations set forth in Section 9554 of the Civil Code of the State of California.

All alterations, extensions of time, extra and additional work, and other changes authorized by these specifications or any part of the contract may be made without securing the consent of the surety or sureties on the contract bonds.
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EVOQUA WATER TECHNOLOGIES LLC
General Terms and Conditions for Erection Work
These terms are in addition to and subject to the Sellers terms of sale.

1. Equipment location. Equipment location and staking, including plant orientation, influent and effluent location, is the responsibility of the Purchaser and/or his engineer.

2. Equipment Elevation. The elevation of equipment above or below grade must be determined by the purchaser and/or his engineer and entered upon the approved drawings. Purchaser is responsible for establishing benchmark at site for Seller’s erection crew.

3. Site Access/Erection. Purchaser agrees to provide a clear level work area at least 35 feet wide around the periphery of the erection site.

Prior to starting erection, any obstructions in the work area, such as excavations, overhead lines, fences, trees, shrubbery, etc., shall be removed by and at the expense of the purchaser. The purchaser shall keep the site properly drained and free from surface water during erection, and until the work has been completed and accepted. The site and site access shall be capable of supporting a crane up to and including 50-ton capacity and other erection equipment. Any fill or dewatering necessary to accomplish the above, or additional costs of oversized or special equipment required due to poor site conditions, will be the responsibility of the Purchaser. Site leveling, grading, etc., after erections, shall be the responsibility of the Purchaser. Seller shall be responsible for the cleanup and removal of trash, scrap materials, etc., left from Seller’s erection work.

4. Site Access. Purchaser agrees to provide site access and site working area capable of supporting the delivery trucks (70,000-75,000 pounds gross weight). Purchaser agrees to maintain site access and working area, daily if required, to allow Seller’s erection crew to perform work during all weather conditions. Should Seller have to stop work and return to the site when access and/or work area permits or experience delays due to the site and site access being unsuitable for work due to Purchaser’s failure to prepare and/or maintain the above, the Purchaser agrees to compensate Seller for cost incurred and agrees Seller shall be indemnified and held harmless from all loss or damages resulting from delays of job progress, that are directly or indirectly a result of the Purchaser’s responsibility.

5. Labor Relations. Seller’s erection personnel are non-union, and all work will be by non-union personnel. In case of interference in erection work due to labor problems by persons not employed by Seller, or the imposition of requirements concerning labor, working conditions, wage rates, etc., which were not clearly defined prior to Seller’s acceptance of the erection job, Seller shall have the right to stop work without prejudice until such interference or condition is satisfactorily removed or resolved. If additional costs are incurred by Seller due to such conflict, the Purchaser hereby agrees to reimburse Seller for the additional costs incurred.

Evoqua is an Equal Opportunity Employer and shall comply with government regulations pertaining to fair and equal employment.

Work hours by Seller at the site shall be as determined by Seller. The Purchaser shall not define working hours or number of work days per week, nor prohibit Seller from working evenings, weekends, holidays, etc., when deemed to be advisable by Seller.

6. Prevailing Wages. In accordance with California Labor Code Section 1771, Seller shall pay all workers, and shall ensure its sub Sellers pay all of their workers, engaged in performing the services described herein not less than the general prevailing rate of per diem wages for work of a similar character in the locality in which the services are to be performed, and not less than the general prevailing rate of per diem wages for holiday and overtime work as provided in the California Labor Code. In accordance with California Labor Code Section 1773.2, the Buyer has obtained the general prevailing wages in the locality in which the services are to be performed for each craft or type of work needed to be as published by the State of California Department of Industrial Relations, Division of Labor Statistics and Research, a copy of which is on file in the Buyer’s Purchasing Department and shall be made available on request. Seller must comply with all applicable laws and regulations that apply to wages earned in performance of the services described herein, including those set forth in Labor Code section 1770 et. seq.
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Evoqua Water Technologies LLC

7. Insurance. Seller shall procure and maintain for the duration of the contract, and for 10 years thereafter, insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder and the results of that work by the Seller, their agents, representatives, employees, or sub-Sellers.

MINIMUM SCOPE AND LIMIT OF INSURANCE
Coverage shall be at least as broad as:

1. Commercial General Liability (CGL): Insurance Services Office Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $5,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location (ISO CG 25 03 or 25 04) or the general aggregate limit shall be twice the required occurrence limit.

2. Automobile Liability: Insurance Services Office Form CA 0001 covering Code 1 (any auto), with limits no less than $5,000,000 per accident for bodily injury and property damage.

3. Workers’ Compensation: as required by the State of California, with Statutory Limits, and Employer’s Liability Insurance with limit of no less than $1,000,000 per accident for bodily injury or disease.

4. Builder’s Risk (Course of Construction), if applicable, insurance utilizing an “All Risk” (Special Perils) coverage form, with limits equal to the completed value of the project and no coinsurance penalty provisions.

6. Sellers’ Pollution Legal Liability and/or Asbestos Legal Liability and/or Errors and Omissions (if project involves environmental hazards) with limits no less than $1,000,000 per occurrence or claim, and $2,000,000 policy aggregate.

If the Seller maintains broader coverage and/or higher limits than the minimums shown above, the City of Stockton requires and shall be entitled to the broader coverage and/or the higher limits maintained by the Seller. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City of Stockton.

Umbrella or Excess Coverage
The Seller may use Umbrella or Excess Policies to provide the liability limits as required in this agreement. This form of insurance will be acceptable provided that all of the Primary and Umbrella or Excess Policies shall provide all of the insurance coverages herein required, including, but not limited to, primary and non-contributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The Umbrella or Excess policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying Commercial General Liability insurance. No insurance policies maintained by the Additional Insureds, whether primary or excess, and which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the Seller’s primary and excess liability policies are exhausted.

The insurance policies are to contain, or be endorsed to contain, the following provisions:

Additional Insured Status
The City of Modesto, its officers, officials, employees, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of the Seller including materials, parts, or equipment furnished in connection with such work or operations. General liability coverage can be provided in the form of an endorsement to the Seller’s insurance with coverage equal to ISO form CG 2010. For completed operations, a separate endorsement equal to ISO form CG 2037 is required. #20..
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Evoqua Water Technologies LLC
Primary Coverage
The Additional Insured coverage under the Seller’s policy shall be “primary and non-contributory” and will not seek contribution from the Buyer’s insurance or self-insurance and shall be at least as broad as CG 20 01 04 13. The City of Modesto does not accept endorsements limiting the Seller’s insurance coverage to the sole negligence of the Named Insured.

Builder’s Risk (Course of Construction) Insurance
Sellers may submit evidence of Builder’s Risk insurance in the form of Course of Construction coverage. Such coverage shall name the Entity as a loss payee as their interest may appear. If the project does not involve new or major reconstruction, at the option of the Entity, an Installation Floater may be acceptable. For such projects, a Property Installation Floater shall be obtained that provides for the improvement, remodel, modification, alteration, conversion or adjustment to existing buildings, structures, processes, machinery and equipment. The Property Installation Floater shall provide property damage coverage for any building, structure, machinery or equipment damaged, impaired, broken, or destroyed during the performance of the Work, including during transit, installation, and testing at the Entity’s site.

Claims Made Policies –
If any coverage required is written on a claims-made coverage form:

1. The retroactive date must be shown, and this date must be before the execution date of the contract or the beginning of contract work.

2. Insurance must be maintained, and evidence of insurance must be provided for at least five (5) years after completion of contract work.

3. If coverage is cancelled or non-renewed and not replaced with another claims-made policy form with a retroactive date prior to the contract effective, or start of work date, the Seller must purchase extended reporting period coverage for a minimum of five (5) years after completion of contract work.

4. A copy of the claims reporting requirements must be submitted to the Entity for review.

5. If services involve lead-based paint or asbestos identification/remediation, the Sellers Pollution Liability policy shall not contain lead-based paint or asbestos exclusions. If the services involve mold identification/remediation, the Sellers Pollution Liability policy shall not contain a mold exclusion, and the definition of Pollution shall include microbial matter, including mold.

Notice of Cancellation
Each insurance policy required above shall provide that coverage shall not be canceled, except with notice to the City of Modesto.

Waiver of Subrogation
Seller hereby grants to Buyer a waiver of any right to subrogation which any insurer of said Seller may acquire against the Buyer by virtue of the payment of any loss under such insurance. Seller agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision applies regardless of whether or not the Buyer has received a waiver of subrogation endorsement from the insurer.

Self-Insured Retentions
All Self-insured retentions must be disclosed to Risk Management for approval and shall not reduce the limits of liability.

The Buyer may require the Seller to purchase coverage with a lower retention or provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention. Any and all deductibles and SIRs shall be the sole responsibility of Seller or sub Seller who procured such insurance and shall not apply to the Indemnified Additional Insured Parties.

Acceptability of Insurers
Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A:VII, unless otherwise acceptable to the Buyer.
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Evoqua Water Technologies LLC
Verification of Coverage
Seller shall furnish the Buyer with original certificates and amendatory endorsements or copies of the applicable policy language effecting coverage required by this clause and a copy of the Declarations and Endorsements Pages of the CGL and any Excess policies listing all policy endorsements. All certificates and endorsements are to be received and approved by the City of Modesto Risk Services before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive the Seller’s obligation to provide them. The Buyer reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time. City reserves the right to obtain a full certified copy of any insurance policy and endorsements. Failure to exercise this right shall not constitute a waiver of right to exercise later.

Duration of Coverage
CGL & Excess liability policies for any construction related work, including, but not limited to, maintenance, service, or repair work, shall continue coverage for a minimum of 5 years for Completed Operations liability coverage. Insurance must be maintained, and evidence of insurance must be provided for at least five (5) years after completion of the contract of work.

Surety Bonds Seller shall provide the following
Special Risks or Circumstances
Buyer reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

Certificate Holder Address
Proper address for mailing certificates, endorsements and notices shall be:

City of Modesto
Attn: Risk Management
1010 10th Street
Modesto, CA 95354

8. Unloading of Equipment. Seller is responsible for unloading of equipment which is to be erected by Seller. Purchaser is responsible for unloading any equipment or accessories shipped to Purchaser for his installation. (Such as base channels to be embedded in concrete foundation by Purchaser, blowers or other accessories to be installed by Purchaser).

9. Purchaser Acceptance of Erected Equipment. When erection of the equipment nears completion Seller shall give Purchaser seventytwo hours verbal notice that the equipment shall be ready for inspection and acceptance. Purchaser agrees to provide, on seventy-two hours’ notice, an authorized agent to meet at the site with Seller’s erection personnel, to inspect the erected equipment, and accept same for/or on behalf of the Purchaser. Any backordered items not installed at that time shall be listed on the acceptance agreement with written understanding that Seller is responsible for installing the subject equipment. Backordered items shall be received by the Purchaser at the “Backordered Address” previously provided and stored until Seller’s installation is scheduled.

10. Preparation for Start-up of Erected Equipment. Upon completion of erection Seller shall inform the Purchaser that the erected equipment is ready to be placed in service. The Purchaser shall make all preparations for which he is responsible, such as influent and effluent connections, installation of the required electrical power supply and circuitry, filling tanks with clean water for testing and startup, etc. If any deficiencies in Seller’s materials or workmanship are discovered by the Purchaser while performing this work, the Purchaser shall immediately notify Seller so that corrective action can be taken. Seller is responsible for providing start-up supervision as defined in this Quotation. For scheduling purposes, ten days’ notice of desired start-up date is required.

11. Security and Protection of Equipment. Purchaser is responsible for security of equipment stored on his site after delivery and prior to arrival of Seller’s crews to begin erection; and for any backordered material delivered to Purchaser after departure of Seller’s erection crews. Seller shall not be responsible for deterioration, theft, vandalism or damage to equipment which is stored on site or left inoperative after installation due to delays in start-up. Purchaser agrees to be responsible for security and protection of such equipment.

12. Back-charges. Seller will accept no back-charges, for any reason, which have not been approved in writing by an authorized manager of the company prior to any work being performed Purchaser agrees to contact Seller and receive written authorization prior to incurring any costs related to back-charges.
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Evoqua Water Technologies LLC

13. Licenses and Permits. Unless specifically stated in Seller’s Quotation, Seller is not responsible for licenses, permits or fees required to perform the work defined in this Quotation.

14. Delays. Seller shall not be liable for delays due to: (1) causes beyond its reasonable control; (2) acts of God, acts of customer, prerequisite work by others, acts of civil or military authority, government priorities, fires, strikes or other labor disturbances, floods, epidemics, war, riot, delays in transportation; or (3) inability to obtain or delay in obtaining, due to causes beyond its reasonable control, suitable labor, materials, or facilities.

In the event of any such delay; the time of performance shall be extended for a period equal to the time lost by reason of the delay.

In the event Seller is delayed by acts of the customer or by prerequisite work by other contractors or suppliers of the customer, Seller shall be entitled to an equitable price adjustment in addition to extension of the time of performance.

15. Subcontract. Seller reserves the right to subcontract any of the work to one or more subcontractors. #20..
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1826 Metcalfe Avenue
Thomasville, GA 31792 USA
Tel: +1 (229) 226-5733
Fax: +1 (229) 228-0312

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March 10, 2025
To: City of Modesto, CA
Attn: Mr. Nolan Harris
Plant Maintenance Supervisor
1221 Sutter Avenue
Modesto, CA 95351
Re: City of Modesto, CA WWTP
Internalift® Screw Pump Replacement Project
Dear Mr. Harris:

This letter is to confirm that the existing screw pumps located at the City of Modesto WWTP are proprietary equipment manufactured by Evoqua Water Technologies in Thomasville, GA. Evoqua Water technologies is the only authorized source for replacement pumps and/or repair of the equipment.

Please note also, that JBI Water and Wastewater Equipment is the Evoqua Water Technologies’ manufacturer’s representative in the state of California for screw pumps currently in use by the City of Modesto.

If you need any additional information or have any questions, please feel free to give me a call or reach out to Simon Morris at JBI.

Sincerely
Richard T. Barnes Jr. Simon Morris
Technical Sales Engineer Area Sales Representative
Evoqua Water Technologies JBI Water and Wastewater Equipment 229-227-8758 916-642-5500
[email protected] [email protected]
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

May 6, 2025
Date: April 7, 2025
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: William Wong, Director of Utilities
SUBJECT: Purchase and Sale Agreement
7111 McHenry Avenue, Stanislaus County, CA
CONTACT: Edgar Vargas, Senior Civil Engineer, [email protected], 209-577-5424 DESCRIPTION:

Consider approving the purchase of 14,426 square feet of real property located at 7111 McHenry Avenue, Stanislaus County, CA for $76,500, plus $15,000 in closing costs to be used for the Del Rio Well 70 Treatment System Project. (Funding Source: Water Fund) STRATEGIC PLAN ELEMENT:

The recommended action supports the 2020-2025 City’s Strategic Plan Initiatives, Goal D:

Provide safe, efficient, and reliable infrastructure through proactive community investment, maintenance, and sustainability efforts.

BACKGROUND:

In 1995, the City of Modesto purchased the Del Este Water System, which included what was formerly known as Well 271, located in the Del Rio service area. On September 14, 2010, by Resolution No. 2010-409, Well 271 was identified for replacement in the 2010 Water System Engineer’s Report to meet the needs of the existing Del Rio service area. The existing Well 271 site was not large enough to accommodate a replacement well and at the time, no adjacent property was available next to the well site. A portion of the parcel at the Northwest corner of McHenry Avenue and Steward Road was identified as a proposed replacement well site.

In 2011, in accordance with City of Modesto Administrative Directive 3.1, West Yost Associates, Inc. (West Yost) was selected to provide hydrogeological, design and construction support for a test well on the proposed replacement site.

On January 5, 2012, by Resolution Nos. 2012-35 and 2012-36, Council approved plans and specifications prepared by West Yost for the Del Rio Replacement Test Well project, approved an Agreement with West Yost for construction oversight and analysis services, and awarded a contract with Dan’s Water Well & Pump Service, Inc. of Livermore, CA, to construct the test well.
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City Council, May 6, 2025
Purchase and Sale Agreement
7111 McHenry Avenue, Stanislaus County, CA

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On October 2, 2012, by Resolution No. 2012-402, Council accepted the work performed by Dan’s Water Well & Pump Service, Inc. for the Del Rio Replacement Test Well Project as complete.

On May 9, 2017, by Resolution No. 2017-187, Council approved an Agreement with West Yost for the final design, bid period and well equipping support services for the Del Rio replacement Well 271 Project.

On September 5, 2017, by Resolution No. 2017-347, Council certified the Final Environmental Impact Report for the Del Rio Water System Improvements Project.

On January 16, 2018, by Resolution No. 2018-05, Council approved the sale and purchase of a

0.52-acre portion of land located at 7121 McHenry Avenue in the amount of $21,600 for the Del Rio Replacement Well 271 Project.

On March 14, 2018, by Resolution No. 2018-144, Council approved the plans and specifications for the Del Rio Replacement Well 271 Project, accepted the bid and awarded a Contract to NorCal Pump & Well Drilling, Inc., of Yuba City, CA, to construct the subsurface improvements of Well 271.

During the final design phase of the Del Rio Replacement Well 271, City staff was informed by the Department of Water Resources that Well number 271 could not be re-used and that new well numbers will be required for replacement wells. Due to this, the City’s project became known as Del Rio Well 70 (Replacing Well 271), which included surface improvements enabling the newly installed Del Rio Production Well (Well 70) increased service reliability of the City’s water system as described in the 2010 Water System Engineer’s Report.

The first phase of the project, which consisted of the drilling of the well, was awarded on April 10, 2018, and was completed on January 8, 2019. The final phase of the project for surface improvements consisted of a new well head, new pump & motor, a new pump building and walled building enclosure, all necessary electrical controls, a chlorine room, and a standby emergency generator. The surface improvements also included 900 linear feet of 12-inch water pipe to the existing water system, 900 linear feet of 8-inch well flushing pipe and an air gap flushing structure.

On August 13, 2019, by Resolution No. 2019-376, Council approved the plans and specifications for the Del Rio Well 70 (Replacing Well 271) Surface Improvements, accepted the bid and awarded a Contract to Conco-West, Inc., of Manteca, CA, to construct the surface improvements of Well 271.

On May 24, 2022, by Resolution No. 2022-241, Council accepted the Del Rio Well 70 (Replacing Well 271) Surface Improvements as complete, authorizing all necessary steps to file with the County Recorder, releasing securities, and releasing payments totaling $2,444,787 to Conco-West, Inc. of Manteca, CA.
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DISCUSSION:

In the Spring of 2021, as the City was preparing to bring Well 70 online, it was discovered that the well was producing poor water quality samples. Initially, the City did not plan to install a treatment system for the well; however, due to the poor water quality, it became clear that a treatment system would be necessary to bring the well into service. Unfortunately, the existing well site was too small to accommodate the required treatment system. As a result, City staff began exploring adjacent properties to identify a suitable location for the system.

The City identified a 14,426 square foot parcel to the North of the Well 70 site at 7111 McHenry Avenue which was deemed suitable for the installation of the treatment system. Further investigation revealed that the property was owned by Larry Killian, Angelina Mary Killian, Ronald D. Setliff, Shelley R. Setliff, Lenore Catherine Setliff Chladek, Arnold W. Setliff, and Katherine L. Setliff.

City staff initiated preliminary discussions with the property owners regarding the potential purchase of the property. The ownership group agreed to proceed with negotiations to sell the 14,426 square foot parcel to the City for the purpose of accommodating a new treatment system for Well 70.

On December 6, 2023, Associated Right of Way Services, Inc. (ARWS), the City’s real property on-call consultant, was hired to appraise the property and provide an appraisal report intended to assist the City in acquiring the property located at 7111 McHenry Avenue in Modesto, CA for the Well 70 treatment system.

On January 30, 2024, ARWS provided the appraisal report, completed by Valbridge Property Advisors, determining the fair market value of the 14,426 square foot parcel at $75,000.

On February 6, 2024, City Staff presented the completed appraisal report to the property owners of 7111 McHenry Avenue for review.

Following careful due diligence, including engineering assessments by a third party to ensure the owner’s future development plans would not be impacted, the ownership group agreed to sell the 14,426 square foot parcel to the City for the purpose of accommodating the new treatment system for Well 70. The sellers noted that a reimbursement of $1,500 for their due diligence costs would need to be included in the purchase and sale agreement.

On June 26, 2024, City Staff presented the Purchase and Sale Agreement to the property owners for the purchase of the 14,426 square feet of real property.

On September 30, 2024, the property owners of 7111 McHenry Avenue in Modesto, CA agreed to sell 14,426 square feet of real property for $75,000, plus $1,500 for their due diligence assessments, for a total purchase price of $76,500.

FISCAL IMPACT:

Expenses associated with the purchase of this real property will be housed in the following Capital Improvement Program Project and a budget adjustment to the project is being included:
101078 – Del Rio Replacement Well
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Purchase and Sale Agreement
7111 McHenry Avenue, Stanislaus County, CA

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Anticipated Land Acquisition Expenditures
Purchase Price of Land $ 75,000
Due Diligence Assessments $ 1,500
Estimated Closing Costs $ 15,000
TOTAL $ 91,500
If the property owner was unwilling to voluntarily sell the property to the City, the City would need to use eminent domain to acquire the property, which could result in up to tens of thousands of dollars in legal fees and related costs. Acquiring the property through a negotiated Agreement avoids those costs. In addition, using eminent domain to acquire the property would result in delays, both in finishing the design work and commencing construction. Given current high inflation, especially for construction costs, the longer the City delays constructing the project, the greater the costs will likely be. For these reasons, staff has determined that $76,500 is a fair price for the purchase of the property to proceed with completion of the Well 70 Treatment System Project as soon as possible, at the cheapest overall cost.

COMMITTEE RECOMMENDATION:

There has been no Committee action taken on this item.

CEQA/NEPA REQUIREMENTS:

Environmental review will be provided through a Categorical Exemption under CEQA Section 15301 Class 1(b).

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving the purchase of 14,426 square feet of real property located at 7111 McHenry Avenue, Stanislaus County, CA owned by Larry Killian and Angelina Mary Killian, Trustees of The Killian Family Trust dated August 5, 1993; and Ronald D. Setliff and Shelley R.

Setliff, Trustees of The Setliff 2018 Revocable Trust dated January 5, 2018; and Lenore Catherine Setliff Chladek, a married woman as her sole and separate property; and Arnold W.

Setliff and Katherine L. Setliff, Trustees of the Norma Setliff Family Trust as set forth in the Setliff Revocable Trust dated April 19, 2004 for $76,500, plus $15,000 in closing costs, to be used for the Del Rio Well 70 Treatment System Project, and authorizing the City Manager, or his designee, to execute the Purchase and Sale Agreement and all related documents required to complete the transaction.

Resolution amending the Fiscal Year 2024-25 Capital Improvement Program Budget in the amount of $91,500 to be transferred into the Project from Water Fund Reserves to fund the Del Rio Well 70 Treatment System Project and authorizing the City Manager, or his designee, to implement the provision of the Resolution.

Approved by:

William Wong, Director of Utilities
Joseph P. Lopez, City Manager
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Purchase and Sale Agreement
7111 McHenry Avenue, Stanislaus County, CA

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Attachments:

1. Resolutions (2)

2. Purchase and Sale Agreement and Exhibits

3. Appraisal Report

4. Project Layout Exhibit - Del Rio Well 70 Treatment System #21..
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5/6/2025/Utilities/EVargas/Item XX 1 2025-XX

MODESTO CITY COUNCIL
RESOLUTION NO. 2025-XX
RESOLUTION APPROVING THE PURCHASE OF 14,426 SQUARE FEET OF REAL PROPERTY LOCATED AT 7111 MCHENRY AVENUE, STANISLAUS

COUNTY, CA OWNED BY LARRY KILLIAN AND ANGELINA MARY
KILLIAN, TRUSTEES OF THE KILLIAN FAMILY TRUST DATED AUGUST 5, 1993; AND RONALD D. SETLIFF AND SHELLEY R. SETLIFF, TRUSTEES OF THE SETLIFF 2018 REVOCABLE TRUST DATED JANUARY 5, 2018; AND

LENORE CATHERINE SETLIFF CHLADEK, A MARRIED WOMAN AS HER SOLE AND SEPARATE PROPERTY; AND ARNOLD W. SETLIFF AND
KATHERINE L. SETLIFF, TRUSTEES OF THE NORMA SETLIFF FAMILY

TRUST AS SET FORTH IN THE SETLIFF REVOCABLE TRUST DATED APRIL 19, 2004 FOR $76,500, PLUS $15,000 IN CLOSING COSTS, TO BE USED FOR THE DEL RIO WELL 70 TREATMENT SYSTEM PROJECT, AND

AUTHORIZING THE CITY MANAGER, OR HIS DESIGNEE, TO EXECUTE

THE PURCHASE AND SALE AGREEMENT AND ALL RELATED

DOCUMENTS REQUIRED TO COMPLETE THE TRANSACTION
WHEREAS, in 1995 the City of Modesto purchased the Del Este Water System, which included Well 271 located in the Del Rio service area, and WHEREAS, Well 271 was identified for replacement in the 2010 Water System Engineer’s Report to meet the needs of the existing Del Rio service area, and WHEREAS, during the final design phase of the Del Rio Replacement Well 271, staff was informed by the Department of Water Resources that Well number 271 could not be re-used and that new well numbers will be required for replacement wells, and WHEREAS, due to this, the City’s project became known as Del Rio Well 70 (Replacing Well 271), and
WHEREAS, in the Spring of 2021, as the City was preparing to bring Well 70 online, it was discovered that the well was producing poor water quality samples, and WHEREAS, initially, the City did not plan to install a treatment system for the well; however, due to the poor water quality, it became clear that a treatment system would be necessary to bring the well into service, and
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5/6/2025/Utilities/EVargas/Item XX 2 2025-XX
WHEREAS, the existing well site was too small to accommodate the required treatment system, and
WHEREAS, staff began exploring adjacent properties to identify a suitable location for the system, and
WHEREAS, a 14,426 square foot parcel to the North of the Well 70 site at 7111 McHenry Avenue was deemed suitable for the installation of the treatment system, and WHEREAS, staff initiated preliminary discussions with the property owners regarding the potential purchase of the property, and
WHEREAS, Associated Right of Way Services provided an appraisal report, completed by Valbridge Property Advisors, determining the fair market value of the 14,426 square foot parcel at $75,000, and
WHEREAS, the ownership group agreed to sell 14,426 square feet of real property for $75,000, plus $1,500 for their due diligence assessments, for a total purchase price of $76,500.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby authorizes the purchase of 14,426 square feet of real property located at 7111 McHenry Avenue, Stanislaus County, CA owned by Larry Killian and Angelina Mary Killian, Trustees of The Killian Family Trust dated August 5, 1993; and Ronald D.

Setliff and Shelley R. Setliff, Trustees of The Setliff 2018 Revocable Trust dated January 5, 2018; and Lenore Catherine Setliff Chladek, a married woman as her sole and separate property; and Arnold W. Setliff and Katherine L. Setliff, Trustees of the Norma Setliff Family Trust as set forth in the Setliff Revocable Trust dated April 19, 2004 for $76,500, #21..
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plus $15,000 in closing costs, to be used for the Del Rio Well 70 Treatment System Project.

BE IT FURTHER RESOLVED that the City Manager, or his designee, is authorized to execute the Purchase and Sale Agreement and all related closing documents, in a form approved by the City Attorney, and negotiate minor changes that the City Manager deems appropriate.
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5/6/2025/Utilities/EVargas/Item XX 4 2025-XX
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 6th day of May, 2025, by ___________, who moved its adoption, which motion being duly seconded by ___________, 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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5/6/2025/Utilities/EVargas/Item X 1 2025-XX

MODESTO CITY COUNCIL
RESOLUTION NO. 2025-XX
RESOLUTION AMENDING THE FISCAL YEAR 2024-25 CAPITAL
IMPROVEMENT PROGRAM BUDGET IN THE AMOUNT OF $91,500 TO BE

TRANSFERRED INTO THE PROJECT FROM WATER FUND RESERVES TO FUND THE DEL RIO WELL 70 TREATMENT SYSTEM PROJECT AND

AUTHORIZING THE CITY MANAGER, OR HIS DESIGNEE, TO IMPLEMENT

THE PROVISION OF THE RESOLUTION
WHEREAS, certain budgetary transactions are necessary in the amount of $91,500, in order to fund the Del Rio Well 70 Treatment System Project, and WHEREAS, the Fiscal Year 2024-25 Capital Improvement Program Budget must be amended.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the amendment of the Fiscal Year 2024-25 Capital Improvement Program Budget in the amount of $91,500.

BE IT FURTHER RESOLVED that the City Manager, or his designee, is hereby authorized to implement the provisions of this resolution. #21..
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5/6/2025/Utilities/EVargas/Item X 2 2025-XX
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 6th day of May 2025, 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:

DIANA NAYARES-PEREZ, CMC
City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ____________________________________
JOSE M. SANCHEZ, City Attorney
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1 PURCHASE AND SALE AGREEMENT

AND JOINT ESCROW INSTRUCTIONS

THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this “Agreement”) is entered into as of ________, 2025 (the “Effective Date”), by and between the City of Modesto, a California charter city (“Buyer”), and Larry Killian and Angelina Mary Killian, Trustee of The Killian Family Trust dated August 5, 1993; and Ronald D. Setliff and Shelley R. Setliff, Trustees of The Setliff 2018 Revocable Trust dated January 6, 2018; and Lenore Catherine Setliff Chladek, a married woman as her sole and separate property; and Ronald D. Setliff, successor trustee of The Earnest Baxter Setliff, Jr. Testamentary Trust (Trust FBO Sharon Ann Setliff); and Ronald D. Setliff, sole successor trustee of The Setliff Trust for Sharon created under the terms of the Gladys C. Revocable Trust, also known as the Gladys C.

Revocable Trust: and Arnold W. Setliff and Katherine L. Setliff, Trustees of The Norma Setliff Family Trust as set forth in the Setliff Revocable Trust dated April 19, 2004 (collectively, “Seller”). Seller and Buyer may each be referred to herein as a “Party” or collectively as the “Parties.”

RECITALS
A. Seller is the owner of that certain real property located at approximate 7111 McHenry Avenue, in Stanislaus County, California 95356, also known as Stanislaus County Assessor’s Parcel Number 004-102-005 (the “Premises”).

B. Buyer owns certain real property, on which it maintains water well facilities, located adjacent to the Premises. Buyer desires to acquire a portion of the Premises in order to expand the water well facilities.

C. Buyer desires to purchase a total of 14,426 square feet of the Premises, as more particularly described and depicted in Exhibit A, attached hereto and incorporated herein (the “Property”), from the Seller.

D. Buyer has offered to purchase the Property for Seventy-Five Thousand Dollars ($75,000), which is the fair market value of the Property as determined by an appraisal completed by Valbridge Property Advisors and dated January 30, 2024, plus an additional One Thousand Five Hundred Dollars ($1,500) for reimbursement of certain expenses incurred by Seller due to preliminary due diligence engineering services performed on the Property. The total purchase price for the Property will be Seventy-Six Thousand Five Hundred Dollars ($76,500).

E. Buyer is a public agency, and Buyer’s purchase of the Property is exempt from the requirements of the Subdivision Map Act pursuant to Government Code section 66426.5
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2 F. Buyer agrees to purchase the Property, and Seller agrees to sell the Property to Buyer, subject to the terms and conditions of this Agreement.

NOW, THEREFORE, for and in consideration of the mutual covenants and agreements contained in this Agreement, and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged by the parties, Seller and Buyer hereby agree as follows:

1. INCORPORATION OF RECITALS AND EXHIBITS. The Recitals set forth above and the Exhibits attached to this Agreement are each incorporated into the body of this Agreement as if set forth in full.

2. PURCHASE AND SALE.

2.1 Agreement to Buy and Sell. Subject to the terms and conditions set forth herein, Seller agrees to sell the Property to Buyer, and Buyer hereby agrees to acquire the Property from Seller. The Property shall include all improvements located thereon, as well as any and all privileges, rights, easements appurtenant to the Property.

2.2 Purchase Price. The purchase price for the Property to be paid by Buyer to Seller (the “Purchase Price”) is Seventy-Six Thousand Five Hundred Dollars ($76,500). The Purchase Price will be paid in immediately available funds to Seller on the Closing Date at the address of Seller as provided in Section 10.8 of this Agreement.

3. ESCROW.

3.1 Escrow Account. Buyer has opened, or within three (3) business days of the Effective Date shall open, an escrow account (the “Escrow”) maintained by Chicago Title Company (the “Title Company”), 1700 Standiford Avenue, Suite 110 Modesto, CA 95351 Attn: Karla Sam Sin, or such other title company as selected by the City (the “Escrow Holder”), with interest accruing to the benefit of Buyer. Escrow Holder shall perform all escrow and title services in connection with this Agreement.

3.2 Opening of Escrow. Within three (3) business days after the Effective Date, the Parties will deposit into Escrow the fully executed Agreement, or executed counterparts thereto. The date such fully executed Agreement is received by Escrow Holder will be deemed the “Opening of Escrow” and Escrow Holder will give written notice to the Parties of such occurrence.

3.3 Satisfaction of Due Diligence Contingency. Buyer shall have the right, in its sole discretion, to terminate this Agreement for any reason prior to the expiration of the Due Diligence Contingency Period (as defined in Section 5(a) below).

Buyer hereby agrees to provide written notice to Seller prior to the expiration of the Due Diligence Contingency Period if Buyer disapproves any due diligence items or approves all due diligence items (“Approval Notice”). If Buyer disapproves any items through the delivery of the Approval Notice to Seller before 5:00 p.m. on the last day of the Due #21..
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3 Diligence Contingency Period, this Agreement shall terminate, and all amounts deposited by Buyer into escrow, together with interest thereon, if any, will be returned to Buyer, and neither party shall have any further rights or obligations hereunder except those which expressly survive the termination hereof. Notwithstanding the foregoing, if Buyer fails to timely deliver the Approval Notice to Seller, it will be conclusively presumed that Buyer has approved all such items, matters or documents.

4. PROPERTY DISCLOSURE REQUIREMENTS.

4.1 Condition of Title/Preliminary Title Report. Escrow Holder shall deliver a Preliminary Title Report for the Property (the “Preliminary Report”) to Buyer within three (3) days after the Opening of Escrow. Buyer shall have until the end of the Due Diligence Contingency Period to approve the condition of title to the Property. If Buyer delivers the Approval Notice, Buyer agrees to take title to the Property subject to the following “Permitted Exceptions:” (a) standard printed exceptions in the Preliminary Report acceptable to Buyer; (b) general and special real property taxes and assessments constituting a lien not yet due and payable; and (c) the exceptions to the title referenced in the Approval Notice.

4.2 Environmental and Natural Hazards Disclosure. California Health & Safety Code section 25359.7 requires owners of non-residential real property who know, or have reasonable cause to believe, that any release of hazardous substances are located on or beneath the real property to provide written notice of same to the buyer of real property. Other applicable laws require Seller to provide certain disclosures regarding natural hazards affecting the Property. Seller agrees to make all necessary disclosures required by law within ten (10) business days of the effective date.

5. CLOSING AND PAYMENT OF PURCHASE PRICE.

5.1 Closing. The closing (the “Closing” or “Close of Escrow”) will occur no later than thirty (30) days after the Effective Date (“Closing Date”). If Close of Escrow has not occurred by the Closing Date, Seller or Buyer may elect to terminate this Agreement. Nothing herein shall prevent the Close of Escrow prior to the Closing Date once all conditions in Section 5.2 have been satisfied.

5.2 Buyer’s Conditions to Closing. Buyer's obligation to purchase the Property is subject to the satisfaction of all of the following conditions or Buyer's written waiver thereof (in Buyer’s sole discretion) on or before the Closing Date:
(a) Buyer will have twenty (20) days from the Opening of Escrow (the “Due Diligence Contingency Period”) to complete physical inspections of the Property and due diligence related to the purchase of the Property. Seller shall provide to Buyer copies of all reasonably available and known documents relating to the ownership and operation of the Property, including but not limited to plans, permits and reports (environmental, structural, mechanical, engineering and land surveys) that Seller has in its possession not later than five (5) business days following the execution and delivery #21..
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4 of this Agreement. All physical inspections must be coordinated with Seller’s representative and require twenty-four (24) hour prior notice to Seller. Physical inspections may be conducted by the Buyer, or its representative, an may include minor disturbances of the property, such as disturbing pavement for soil sampling (b) Seller has performed all obligations to be performed by Seller pursuant to this Agreement.
(c) Seller's representations and warranties herein are true and correct in all material respects as of the Closing Date. (d) The Title Company is irrevocably committed to issue a CLTA Title Policy to Buyer, effective as of the Closing Date, insuring title to Buyer in the full amount of the Purchase Price subject only to the Permitted Exceptions.

5.3 Seller’s Conditions to Closing. The Close of Escrow and Seller's obligation to sell and convey the Property to Buyer are subject to the satisfaction of the following conditions or Seller's written waiver (in Seller’s sole discretion) of such conditions on or before the Closing Date:
(a) Buyer has performed all obligations to be performed by Buyer pursuant to this Agreement before Closing Date.
(b) Buyer's representations and warranties set forth herein are true and correct in all material respects as of the Closing Date.

5.4 Conveyance of Title. Seller will deliver marketable fee simple title to Buyer at the Closing, subject only to the Permitted Exceptions. The Property will be conveyed by Seller to Buyer in an “as is” condition; provided, however, that the foregoing shall not relieve Seller from disclosure of any such conditions of which Seller has actual knowledge.

5.5 Deliveries at Closing.
(a) Deliveries by Seller. No less than one (1) business day prior to the close of escrow, Seller shall deposit into the Escrow for delivery to Buyer at Closing:
(i) a grant deed;
(ii) an affidavit or qualifying statement which satisfies the requirements of paragraph 1445 of the Internal Revenue
Code of 1986, as amended, any regulations thereunder (the “Non-Foreign Affidavit”);
(iii) a California Franchise Tax Board form 590 to satisfy the requirements of California Revenue and Taxation Code
Section 18805(b) and 26131;
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20014351.1
5 (iv) such resolutions, authorizations, or other documents or agreements relating to Seller as shall be reasonably required by Title Company; and
(v) all other documents required by this Agreement to
complete the Closing.
(b) Deliveries by Buyer. No less than one (1) business day prior to the close of escrow, Buyer shall deposit into the Escrow at Closing immediately available funds in the amount, which together interest thereon, if any, is equal to:
(i) the Purchase Price as adjusted by any prorations between the Parties;
(ii) Buyer’s share of the escrow fees and recording fees; and (iii) the cost of the Title Policy;
(iv) a certificate of acceptance for the grant deed;
(v) such resolutions, authorizations, or other documents or agreements relating to Buyer as shall be reasonably required by Title Company; and
(vi) all other documents required by this Agreement to
complete the Closing.
(c) Closing. Upon Closing, Escrow Holder shall: (i) record the grant deed and certificate of acceptance; (ii) disburse to Seller, or such party as identified by the Seller in writing, the Purchase Price, less Seller’s share of any escrow fees, costs and expenses; (iii) deliver to Buyer the Non-Foreign Affidavit, the California Certificate and the original recorded grant deed; (iv) deliver the title policy to the Buyer; and (v) distribute to itself the payment of escrow fees and expenses required hereunder. (d) Closing Costs. Buyer and Seller will equally split all escrow fees (including the costs of preparing documents and instruments), title report costs, and recording fees. Buyer will pay title insurance. Pursuant to Revenue & Taxation Code section 11922 sale of the Property is exempt from transfer tax because the Buyer is a public agency. All other costs and fees shall be paid in accordance with custom and practice in Stanislaus County.
(e) Pro-Rations. At the close of escrow, the Escrow Agent shall make the following prorations: (i) property taxes will be prorated as of the Close of Escrow based upon the most recent tax bill available, including any property taxes which may be assessed after the close of escrow but which pertain to the period prior to the transfer of title to the Property to Buyer, regardless of when or to whom notice thereof is delivered; and (ii) any bond or assessment that constitutes a lien on the Property at the Close of Escrow will be assumed by Buyer.

6. REPRESENTATIONS, WARRANTIES AND COVENANTS.
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6 6.1 Seller’s Representations, Warranties and Covenants. In addition to the representations, warranties and covenants of Seller contained in other sections of this Agreement, Seller hereby represents, warrants and covenants to Buyer that the statements below in this Section 6.1 are each true and correct as of the Closing Date:
(a) Authority. Seller has the full right, capacity, power and authority to enter into and carry out the terms of this Agreement. The Seller explicitly represents and warrants that it has the full right to sell or otherwise dispose the Property to Buyer. This Agreement has been duly executed by Seller, and upon delivery to and execution by Buyer is a valid and binding agreement of Seller. (b) Encumbrances. Seller has not alienated, encumbered, transferred, mortgaged, assigned, pledged, or otherwise conveyed its interest in the Property or any portion thereof, nor entered into any Agreement to do so, and there are no liens, encumbrances, mortgages, covenants, conditions, reservations, restrictions, easements or other matters affecting the Property, except as disclosed in the Preliminary Report. Seller will not, directly or indirectly, alienate, encumber, transfer, mortgage, assign, pledge, or otherwise convey its interest prior to the Close of Escrow, as long as this Agreement is in force.
(c) Conflicts. There are no agreements affecting the Property except those which have been disclosed by Seller. There are no agreements which will be binding on the Buyer or the Property after the Close of Escrow, which cannot be terminated on thirty (30) days prior written notice.
(d) Condition of Property. Seller hereby represents and warrants to the best of its knowledge that, except as disclosed in writing to Buyer, as of the Effective Date and as of the Close of Escrow: (i) Seller has received no notice, warning, notice of violation, administrative complaint, judicial complaint, or other formal or informal notice alleging that conditions on the Property are or have ever been in violation of any environmental law or informing Seller that the Property is subject to investigation or inquiry regarding hazardous materials on the Property or the potential violation of any environmental law; (ii) there is no monitoring program required by the Environmental Protection Agency or any other governmental agency concerning the Property; (iii) Seller has disclosed to Buyer all information, records, and studies in Seller’s possession or reasonably available to Seller relating to the Property concerning hazardous materials; (iv) Seller has not received any notice from any governmental authority of any threatened or pending zoning, building, fire, or health code violation or violation of other governmental regulations concerning the Property that have not previously been corrected, and no condition on the Property violates any health, safety, fire, environmental, sewage, building, or other federal, state or local law, ordinance or regulation; (v) no contracts, licenses, leases or commitments regarding the maintenance or use of the Property or allowing any third party rights to use the Property are in force; (vi) there are no threatened or pending actions, suits, or administrative proceedings against or affecting the Property or any portion thereof or the interest of Seller in the Property; (vii) there are no threatened or pending condemnation, eminent domain, or #21..
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7 similar proceedings affecting the Property or any portion thereof; (viii) Seller has not received any notice from any insurer of defects of the Property which have not been corrected; (ix) all information that Seller has delivered to Buyer, either directly or through Seller's agents, is accurate and complete; and (x) Seller has disclosed all material facts concerning the Property in Seller’s possession.
(e) Violations. There is not pending or threatened from any Federal, State, City or local authority, litigation, suit of judgment relating to the Property.

Seller has not been formally notified in writing (including by service of process) by any governmental or quasi-governmental entity that the property is in violation of any environmental laws.
(f) Litigation. There is no litigation, arbitration or adversary proceeding pending or threatened before any court or administrative agency that relates to or affects the Property. Seller’s performance hereunder, or which will result in any unsatisfied lien, charge, encumbrance or judgment against any part of or any interest in the Property.
(g) No Contracts. Seller has not entered into any contracts, agreements, or understandings, verbal or written, which are still in effect for the sale, transfer, or alienation of any portion of the Property, or any option, right of refusal, right of first offer or other right relating to any of the foregoing. Between the Effective Date and Closing, no part of the Property shall be alienated, encumbered or transferred in a manner which will be binding on Buyer after Closing. Seller previously entered into one or more agreements to sell the Property to another entity. Seller represents and warrants that all such prior agreements have been terminated and Seller was not in default or breach of such agreements at the time of termination.
(h) No Breach. The execution and delivery of this Agreement and all instruments and agreements associated herewith, and the consummation of the transactions contemplated hereby will not: (i) constitute or result in the breach of, or default under, any oral or written agreement to which Seller is a party or which affects the Property; (ii) constitute or result in violation of any order, decree, or injuction with respect to which Seller and the Property, or either of them, are bound; (iii) cause or entitle any party to have a right to accelerate or declare a default under any oral or written agreement to which Seller is a party; and/or (iv) to the best of Seller’s actual knowledge, violate any provisions of any Municipal, State or Federal law, statutory or otherwise, to which Seller or the Property is or may be subject
The truth and accuracy of each of the representations and warranties, and the performance of all covenants of Seller contained in this Agreement are conditions precedent to Buyer’s obligation to proceed with the Closing hereunder. The foregoing representations and warranties shall survive the expiration, termination, or close of escrow of this Agreement and shall not be deemed merged into the deed upon closing. #21..
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8 6.2 Buyer’s Representations and Warranties. In addition to the representations, warranties and covenants of Buyer contained in other sections of this Agreement, Buyer hereby represents, warrants and covenants to Seller that the statements below in this Section 6.2 are each true as of the Closing Date:
(a) Buyer is a California charter city. Buyer has the full right, capacity, power and authority to enter into and carry out the terms of this Agreement. This Agreement has been duly executed by Buyer, and upon delivery to and execution by Seller shall be a valid and binding agreement of Buyer.

The truth and accuracy of each of the representations and warranties, and the performance of all covenants of Buyer contained in this Agreement are conditions precedent to Seller’s obligation to proceed with the Closing hereunder.

7. REMEDIES In the event of a breach or default under this Agreement by Seller, if such breach or default occurs prior to Close of Escrow, Buyer reserves the right to either (a) seek specific performance from Seller or (b) to do any of the following: (i) to waive the breach or default and proceed to close as provided herein; (ii) to extend the time for performance and the Closing Date until Seller is able to perform; or (iii) to terminate this Agreement upon written notice to Seller, whereupon Seller shall cause Escrow Holder to return to Buyer any and all sums placed into the Escrow by Buyer, and except for the rights and obligations expressly provided to survive termination of this Agreement, neither party shall have any further obligations or liabilities hereunder. IN

THE EVENT OF A BREACH OR DEFAULT HEREUNDER BY BUYER AND THE CLOSING DOES NOT OCCUR DUE TO SUCH DEFAULT, SELLER’S SOLE REMEDY

SHALL BE FOR BUYER TO PAY ANY FEES CHARGED BY TITLE COMAPNY AS LIQUIDATED DAMAGES. THE PARTIES AGREE THAT IN SUCH INSTANCE,

PAYMENT OF THESE FEES REPRESENTS A REASONABLE APPROXIMATION OF SELLER’S DAMAGES AND ARE NOT INTENDED AS A FORFEITURE OR PENALTY

BUT RATHER AN ENFORCEABLE LIQUIDATED DAMAGES PROVISION PURSUANT TO CALIFORNIA CIVIL CODE SECTION 1671, ET SEQ. IN NO EVENT SHALL EITHER

PARTY BE ENTITLED TO LOST PROFITS OR CONSEQUENTIAL DAMAGES AS A RESULT OF THE OTHER PARTY’S BREACH OF THIS AGREEMENT.

8. BROKERS & REAL ESTATE AGENTS.

8.1. Brokers. If either Party retained a real estate broker in the sale of the Property or the negotiation of this Agreement, that Party shall pay compensation to such broker as specified in a separate written agreement between the broker and the Party.

Each Party shall indemnify, hold harmless and defend the other Party from any and all claims, actions and liability for any breach of the preceding sentence, and any commission, finder’s fee, or similar charges arising out of the indemnifying Party’s conduct
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9 9. ASSIGNMENT. Neither Seller nor Buyer may assign its rights or delegate its duties under this Agreement without the express written consent of the other, which consent may be withheld for any reason.

10. MISCELLANEOUS.

10.1 Attorneys’ Fees. If any party employs counsel to enforce or interpret this Agreement, including the commencement of any legal proceeding whatsoever (including insolvency, bankruptcy, arbitration, mediation, declaratory relief or other litigation), the prevailing party shall be entitled to recover its reasonable attorneys’ fees and court costs (including the service of process, filing fees, court and court reporter costs, investigative fees, expert witness fees, and the costs of any bonds, whether taxable or not) and shall include the right to recover such fees and costs incurred in any appeal or efforts to collect or otherwise enforce any judgment in its favor in addition to any other remedy it may obtain or be awarded. Any judgment or final order issued in any legal proceeding shall include reimbursement for all such attorneys’ fees and costs. In any legal proceeding, the “prevailing party” shall mean the party determined by the court to most nearly prevail and not necessarily the party in whose favor a judgment is rendered.

10.2 Interpretation. This Agreement has been negotiated at arm’s length and each party has been represented by, or had the opportunity to consult with, independent legal counsel in this transaction and this Agreement has been reviewed and revised by counsel to each of the Parties. Accordingly, each party hereby waives any benefit under any rule of law (including Section 1654 of the California Civil Code) or legal decision that would require interpretation of any ambiguities in this Agreement against the drafting party.

10.3 Survival. All indemnities, covenants, representations and warranties contained in this Agreement shall survive Close of Escrow.

10.4 Successors. Except as provided to the contrary in this Agreement, this Agreement shall be binding on and inure to the benefit of the Parties and their successors and assigns.

10.5 Governing Law & Venue. This Agreement shall be construed and interpreted in accordance with the laws of the State of California. Venue for any dispute arising out of this Agreement shall be the state or federal courts in Stanislaus County, California.

10.6 Integrated Agreement; Modifications. This Agreement contains all the agreements of the Parties concerning the subject hereof any cannot be amended or modified except by a written instrument executed and delivered by the parties. There are no representations, agreements, arrangements or understandings, either oral or written, between or among the parties hereto relating to the subject matter of this Agreement that are not fully expressed herein. In addition there are no representations, agreements, arrangements or understandings, either oral or written, between or among the Parties #21..
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10 upon which any party is relying upon in entering this Agreement that are not fully expressed herein.

10.7 Severability. If any term or provision of this Agreement is determined to be illegal, unenforceable, or invalid in whole or in part for any reason, such provisions or part thereof shall be stricken from this Agreement, any such provision shall not be affected by the legality, enforceability, or validity of the remainder of this Agreement.

10.8 Notices. Any delivery of this Agreement, notice, modification of this Agreement, consent, approval, waiver, or other communication that either party desires or is required to give to the other party or any other person shall be in writing. Any such communication may be served personally, or by nationally recognized overnight delivery service (i.e., Federal Express) which provides a receipt of delivery, or sent by prepaid, first class mail, return receipt requested to the party’s address as set forth below:

To Buyer City of Modesto
1010 10th Street
Modesto, CA 95354
Attention: City Manager
To Seller: ____________
____________
Attn: _______
To Escrow Holder: Chicago Title Company
1700 Standiford Avenue, Suite 110
Modesto, CA 95351
Attn: Karla Sam Sin,
Any such communication shall be deemed effective upon personal deliver or on the date of first refusal to accept delivery as reflected on the receipt of delivery or return receipt, as applicable.

10.9 Time. Time is of the essence to the performance of each and every obligation under this Agreement.

10.10 Days of Week. If any date for exercise of any right, giving of any notice, or performance of any provision of this Agreement falls on a Saturday, Sunday or holiday, the time for performance will be extended to 5:00 p.m. on the next business day of the City of Modesto

10.11 Waivers. Any waiver by any party shall be in writing. No waiver will be implied from any delay or failure to take action on account of any default by any party. Consent by any party to any act or omission by another party shall not be construed to be a consent to any other subsequent act or omission. #21..
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11 10.12 Further Assurances. The Parties shall at their own cost and expense execute and deliver such further documents and instruments and shall take such other actions as may be reasonably required or appropriate to carry out the intent and purposes of this Agreement.

10.13 Signatures/Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Any one of such completely executed counterparts shall be sufficient proof of this Agreement.

10.14 Date and Delivery of Agreement. Notwithstanding anything to the contrary contained in this Agreement, the parties intend that this Agreement shall be deemed effective, and delivered for all purposes under this Agreement, and for the calculation of any statutory time periods based on the date an agreement between parties is effective, executed, or delivered, as of the Effective Date.

10.15 Representation on Authority of Parties. Each person signing this Agreement represents and warrants that he or she is duly authorized and has legal capacity to execute and deliver this Agreement

SIGNATURES ON FOLLOWING PAGE
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12 IN WITNESS WHEREOF, this Agreement is executed by Buyer and Seller as of the Effective Date.

BUYER
City of Modesto
a California Municipal Corporation
By:_________________________
Joseph P. Lopez, City Manager
Attest:

Diane Nayares-Perez, City Clerk
Approved as to Form:

Jose M. Sanchez, City Attorney
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13 SELLER
Larry Killian and Angelina Mary Killian,
Trustee of The Killian Family Trust dated August 5, 1993; By:_________________________
Larry Killian
By:_________________________
Angelina Mary Killian
Ronald D. Setliff and Shelley R. Setliff,
Trustees of The Setliff 2018 Revocable Trust dated January 6, 2018 By:_________________________
Ronald D. Setliff
By:_________________________
Shelley R. Setliff
Lenore Catherine Setliff Chladek,
a married woman as her sole and separate property
By:_________________________
Lenore Catherine Setliff Chladek
Ronald D. Setliff,
successor trustee of The Earnest Baxter Setliff, Jr. Testamentary Trust (Trust FBO Sharon Ann Setliff) By:_________________________
Ronald D. Setliff
Ronald D. Setliff,
sole successor trustee of The Setliff Trust for Sharon created under the terms of the Gladys C. Revocable Trust, also known as the Gladys C. Revocable Trust
By:_________________________
Ronald D. Setliff
Arnold W. Setliff and Katherine L. Setliff,
Trustees of The Norma Setliff Family Trust as set forth in the Setliff Revocable Trust dated April 19, 2004 By:_________________________
Arnold W. Setliff
By:_________________________
Katherine L. Setliff
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EXHIBIT A

LEGAL DESCRIPTION & DEPICTION
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Appraisal Report
Residential Land: Well 70 Treatment Parcel
7111 McHenry Avenue
Modesto, Stanislaus County, California 95356
Report Date: January 30, 2024
FOR:

Mr. Larry Castellanos
Vice President
Associated Right of Way Services, Inc
1255 Treat Blvd., Suite 815
Walnut Creek, California 94597
Valbridge Property Advisors |
Northern California
1530 The Alameda, Suite 100
San Jose, CA 95126
408.279.1520 phone Valbridge File Number:
408.279.3428 fax CA02-23-0529-000
valbridge.com
Larger Parcel
Well 70 Treatment Parcel - Partial Acquisition
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© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA 1530 The Alameda, Suite 100
San Jose, CA 95126
408.279.1520 phone
408.279.3428 fax
valbridge.com
January 30, 2024
Tony Sciarrilli
408.279.1520 ext. 7123
[email protected]
Mr. Larry Castellanos
Vice President
Associated Right of Way Services, Inc
1255 Treat Blvd., Suite 815
Walnut Creek, California 94597
RE: Appraisal Report
Residential Land: Well 70 Treatment Parcel
7111 McHenry Avenue
Modesto, Stanislaus County, California 95356
Dear Mr. Castellanos:

In accordance with your request, we have performed an appraisal of the above referenced property.

This appraisal report summarizes the pertinent data gathered, the techniques employed, and the reasoning leading to our opinions and conclusions. This letter of transmittal is not valid if separated from the appraisal report.

The property is located along the west side of McHenry Avenue, one parcel north of Stewart Road, in an unincorporated area of Stanislaus County. The street address is 7111 McHenry Avenue, Modesto, CA 95356. The property is further identified as a portion of Assessor Parcel Number (APN) 004-102- 005. The property appraised is identified as the Well 70 Treatment Parcel throughout this report; The Well 70 Treatment Parcel contains 14,426 gross square feet and 10,826 net square feet, according to the Plat Map prepared by North Star Engineering Group, Inc. dated December 21, 2023. Additionally, throughout this report we refer to the entire 82.01-acre parcel (APN 004-102-005) as the Entire Property. The highest and best use of the Entire Property is future single-family residential subdivision development.

The analyses, opinions, and conclusions were developed, and this report was prepared in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal Foundation; the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute; and the requirements of our client.
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Mr. Larry Castellanos
Associated Right of Way Services, Inc
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA Larry Castellanos with Associated Right of Way Services, Inc. is the client in this assignment and along with the City of Modesto are the only intended users of this appraisal and report. The intended use of the appraisal is for the purchase of the Well 70 Treatment Parcel by the City of Modesto to expand the City’s well site.

In this appraisal we will estimate the contributory value of the Well 70 Treatment Parcel as being a part of the Entire Property. This will be done by first valuing the Entire Property and then assigning that price per square foot to the area of the Well 70 Treatment Parcel. This methodology considers the intended use of the appraisal and is considered to be most appropriate.

The findings and conclusions are further contingent upon the following extraordinary assumptions and hypothetical conditions which might have affected the assignment results:

Extraordinary Assumptions:
 We have assumed the buyer will bear all costs associated with engineering and County fees at no detriment to the seller regarding the lot line adjustment.

Hypothetical Conditions:
 None
Based on the analysis contained in the following report, our value conclusions are summarized as follows:

Respectfully submitted,
Valbridge Property Advisors | Northern California
Tony M. Sciarrilli
Appraiser
California Certified License #AG3003462
Walter D. Carney, MAI
Senior Managing Director
California Certified License #AG003413
Component Well 70 Treatment Parcel
Value Type Market Value
Property Rights Appraised Fee Simple
Date of Value January 1, 2024
Market Value $75,000
Value Conclusion
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TABLE OF CONTENTS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 4 Table of Contents
Cover Page
Letter of Transmittal
Table of Contents ...................................................................................................................................................................... 4 Summary of Salient Facts: Entire Property....................................................................................................................... 5 Aerial and Front Views ............................................................................................................................................................. 6 Location Map .............................................................................................................................................................................. 7 Introduction ................................................................................................................................................................................. 8 Scope of Work ......................................................................................................................................................................... 11 Regional and Market Area Analysis................................................................................................................................. 13 City and Neighborhood Analysis ..................................................................................................................................... 20 Site Description: Entire Property ...................................................................................................................................... 25 Improvements Description ................................................................................................................................................. 31 Subject Photographs (Dated January 4, 2024) ............................................................................................................ 32 Assessment and Tax Data ................................................................................................................................................... 34 Market Analysis ....................................................................................................................................................................... 35 Highest and Best Use: Entire Property ........................................................................................................................... 39 Land Valuation: Entire Property ........................................................................................................................................ 41 Reconciliation ........................................................................................................................................................................... 58 Exposure Time and Marketing Period ....................................................................................................................... 58 General Assumptions and Limiting Conditions .......................................................................................................... 59 Certification – Tony Sciarrilli ............................................................................................................................................... 63 Certification – Walter D. Carney, MAI ............................................................................................................................. 64 Addenda .................................................................................................................................................................................... 65 Preliminary Title Report ................................................................................................................................................... 66 Well 70 Treatment Parcel Legal Description ........................................................................................................... 89 Glossary ................................................................................................................................................................................. 91 Qualifications....................................................................................................................................................................... 98 Valbridge Property Advisors Information / Office Locations ......................................................................... 102 #21..
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SUMMARY OF SALIENT FACTS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 5 Summary of Salient Facts: Entire Property

Property Identification
Property Name Residential Land: Well 70 Treatment Parcel Property Address 7111 McHenry Avenue
Modesto, Stanislaus County, California 95356
Latitude & Longitude 37.747051, -120.997878
Assessor's Parcel Number 004-102-005
Property Owner Larry Killian, Angelina Mary Killian, Ronald D. Setliff, Shelley R. Setliff, Lenore Catherine Setliff Chladek, Arnold W. Setliff, and Katherine L. Setliff
Site (Entire Property)
Land Area 82.01 acres
Zoning PD
General Plan Planned Development
Flood Zone Zone X
Valuation Opinions
Highest & Best Use - As Vacant Single-family residential subdivision development Reasonable Exposure Time 6 to 12 months
Reasonable Marketing Time 6 to 12 months
Parcel C
Gross Land Area 14,426 square feet
Net Land Area 10,826 square feet
Approach to Value Well 70 Treatment Parcel
Sales Comparison Approach $75,000
Component Well 70 Treatment Parcel
Value Type Market Value
Property Rights Appraised Fee Simple
Date of Value January 1, 2024
Market Value $75,000
Value Indication
Value Conclusion
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AERIAL AND FRONT VIEWS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 6 Aerial and Front Views

AERIAL VIEW
GROUND VIEW (DATED JANUARY 4, 2024)
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LOCATION MAP
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 7 Location Map
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INTRODUCTION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 8 Introduction
Client and Intended Users of the Appraisal
Larry Castellanos with Associated Right of Way Services, Inc. is the client in this assignment and along with the City of Modesto are the only intended users of this appraisal and report, and no others.

Intended Use of the Appraisal
The intended use of the appraisal is for the purchase of the Well 70 Treatment Parcel by the City of Modesto.

Real Estate Identification
The property is located along the west side of McHenry Avenue, one parcel north of Stewart Road, in an unincorporated area of Stanislaus County. The street address is 7111 McHenry Avenue, Modesto, CA 95356. The property is further identified as a portion of Assessor Parcel Number (APN) 004-102- 005.

Legal Description
Please refer to the addendum for a copy of the legal description of the Entire Property and the legal description of the Well 70 Treatment Parcel.

Use of Real Estate as of the Effective Date of Value
As of the effective date of value, the property was improved with a mixed age almond orchard and support structures.

Use of Real Estate as Reflected in this Appraisal
The use that is reflected in the valuation is single-family residential subdivision land.

Ownership of the Property
According to a Preliminary Title Report, title to the property is vested in Larry Killian and Angelina Mary Killian, trustees of The Killian Family Trust dated August 5, 1993, as to an undivided 10% interest; Ronald D. Setliff and Shelley R. Setliff, Trustees of the Setliff 2018 Revocable Trust dated January 5, 2018, as to an undivided 14.146825% interest; Lenore Catherine Setliff Chladek, a married woman as her sole and separate property, as to an undivided 25.853175% interest, and Arnold W. Setliff and Katherine L. Setliff, trustees of The Norma Setliff Family Trust as set forth in the Setliff Revocable Trust dated April 19, 2004, as to an undivided 50%, as tenants in common.

History of the Property
Ownership of the property has not changed within the past three years. The property was previously proposed for a 92-lot single-family residential subdivision in 1989. However, the tentative subdivision map was never recorded and the PD(189) zoning district which supports an R-1 (Single-Family Residential) zoning, has expired, according to County planning. Kristen Anaya, associate planner with County planning stated that a new Rezone and Tentative Map application to subdivide and/or develop the property would be required in addition to CEQA review and County Board of Supervisors approval. #21..
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INTRODUCTION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 9 Ms. Anaya stated the zoning remains a Planned Development rather than agriculture, so the county’s Measure E (General Election Ballot) is not triggered. The PD(189) district had a minimum lot size of 20,000 square feet, per planning, which is reasonably probable today. This would allow a density of

2.18 units per acre.

Of note, there is an agreement with the City of Modesto to supply public water to the subdivision.

According to the Edgar Vargas, P.E., senior civil engineer with the City of Modesto, the City purchased the current well site (Del Rio Well 70) from the same property owners and at the time of purchase there was a contingency for the City to supply water to their future subdivision project. It was not expected for water treatment to be required since the water quality samples were good. It was not until the City was getting ready to put the well online that they started getting bad water quality samples, and therefore, treatment is now required. The well site expansion is needed for redundancy measures to the Del Rio Water system as a whole, and it will also provide water to the adjacent future subdivision. The agreement to supply water to the proposed subdivision is contingent on the City purchasing the Well 70 Treatment Parcel.

We have considered in the valuation the risks associated with the time duration for how long it will take the City to complete the well expansion. The City engineer, Mr. Vargas, opined the project will be complete within two years. The buyer of the subject still needs to obtain entitlements and we opine the risk of the City not moving forward with the well expansion is very low. We have considered the risks associated with the well expansion and future subdivision approvals in the reconciliation.

When appropriate, we have considered and analyzed the known history of the subject in the development of our opinions and conclusions.

Listings/Offers/Contracts
The property is currently listed for sale and reportedly the listing broker has received letters of intent to purchase from two separate parties. The purchase prices were not disclosed; however, the broker anticipates the property will sell at close to the asking price of $20,000,000 given the pent-up demand for housing in the Del Rio area. Both parties that have submitted letters of intent to purchase are developers who would develop the property with a residential subdivision. Both offers are contingent on approvals. The property was put on the market for sale in early 2020.

Type and Definition of Value
The purpose of this appraisal is to develop an opinion of the market value of the property. “Market Value,” as used in this appraisal, is defined as “The most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress.”1 Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
• Buyer and seller are typically motivated.
• Both parties are well informed or well advised, each acting in what they consider their own best interests;
• A reasonable time is allowed for exposure in the open market; 1 THE DICTIONARY OF REAL ESTATE APPRAISAL, SEVENTH EDITION, (APPRAISAL INSTITUTE, 2022), 118 #21..
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INTRODUCTION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 10 • Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
• The price represents the normal consideration for the property sold unaffected by special or creative financing or sale concessions granted by anyone associated with the sale.” The “as is” value is the value of the property in its present condition under market conditions prevalent on the date of the appraisal.

Valuation Scenarios, Property Rights Appraised, and Effective Dates of Value Opinions of value for the subject were developed under the following valuation scenarios:

Date of Report
The date of this report is January 30, 2024.

List of Items Requested but Not Provided
 None
Assumptions and Conditions of the Appraisal
The acceptance of this appraisal assignment and the completion of the appraisal report submitted herewith are subject to the General Assumptions and Limiting Conditions contained in the report. Our findings and conclusions are further contingent upon the following extraordinary assumptions and/or hypothetical conditions which might have affected the assignment results:

Extraordinary Assumptions:
 We have assumed the buyer will bear all costs associated with engineering and County fees at no detriment to the seller regarding the lot line adjustment.

Hypothetical Conditions:
 None
Valuation Scenarios Effective Date of Value
As Is Market Value of the Fee Simple Interest January 4, 2024 #21..
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SCOPE OF WORK
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 11 Scope of Work
The elements addressed in the Scope of Work are (1) the extent to which the subject is identified, (2) the extent to which the property is inspected, (3) the type and extent of data researched, (4) the type and extent of analysis applied, (5) the type of appraisal report prepared, and (6) the inclusion or exclusion of items of non-realty in the development of the value opinion. These items are discussed below.

Extent to Which the Property Was Identified
The three components of the property identification are summarized as follows:
 Legal Characteristics - The subject was legally identified via its legal description, Assessor’s parcel map, and information in the Preliminary Title Report provided by the client.  Economic Characteristics - Economic characteristics of the property were identified by review of assessment and property tax information, and comparison to properties with similar locational and physical characteristics.
 Physical Characteristics - The subject was physically identified by on-site observations by the appraisers.

Extent to Which the Property Was Inspected
Michael Porter, appraiser with Valbridge Property Advisors, viewed the property from the abutting roadway on January 4, 2024.

Type and Extent of Data Researched
The following data was researched and analyzed: (1) market area data, (2) property-specific market data, (3) zoning and land-use data, and (4) current data on comparable listings and transactions.

Professionals familiar with the subject market/property type were also interviewed.

This report was prepared with the assistance of Ashley Jordan, who performed and assisted in many tasks of the report under full appraiser’s supervision, including defining the problem, purpose of the appraisal, scope of work, research and data collection, market/economic analysis, and writing the appraisal report. The appraiser supervised and verified these steps.

Type and Extent of Analysis Applied (Valuation Methodology) We observed surrounding land use trends, the nature of the improvements, demand for the subject property, and relevant legal limitations in concluding a highest and best use. We then valued the subject land based on that highest and best use conclusion.

There are four primary methods available to develop a land value estimate: (1) sales comparison, (2) land residual method, (3) ground rent capitalization, and (4) subdivision development method (discounted cash flow). While other methods, such as extraction and allocation, are applicable under limited conditions, one or more of these approaches are used in most circumstances to derive an indication of land value.

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SCOPE OF WORK
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 12  Sales Comparison Approach - In the sales comparison approach, value is indicated by recent sales and/or listings of comparable properties in the market, with the appraiser analyzing the impact of material differences in both economic and physical elements between the subject and the comparables.
 Direct Capitalization: Land Residual Method - The land residual methodology involves estimating the residual net income to the land by deducting from total potential income the portion attributable to the improvements, assuming development of the site at its highest and best use. The residual income is capitalized at an appropriate rate, resulting in an indication of land value.
 Direct Capitalization: Ground Rent Capitalization – A market derived capitalization rate is applied to the net income resulting from a ground lease. This can represent the leased fee or fee simple interest, depending on whether the income potential is reflective of a lease in place or market rental rates.
 Yield Capitalization: Subdivision Development Method – Also known as discounted cash flow analysis (DCF), the methodology is most appropriate for land having multiple lot development in the near term as the highest and best use. The current site value is represented by discounting the anticipated cash flow to a present value, taking into consideration all necessary costs of development, maintenance, administration, and sales throughout the absorption period.

All of these approaches to value were considered. The availability of data and applicability of each approach to value within the context of the characteristics of the property, along with the needs and requirements of the client, were assessed. Based on this assessment, the sales comparison approach was developed. The sales comparison approach is the most relevant approach to appraise land. Further discussion of the extent of our analysis and the methodology of the approach used is provided later in the valuation section.

Appraisal Conformity and Report Type
The analyses, opinions, and conclusions were developed and this report was prepared in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal Foundation; the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute; and the requirements of our client. This is an Appraisal Report as defined by the Uniform Standards of Professional Appraisal Practice under Standards Rule 2-2a.

Personal Property/FF&E
All items of non-realty are excluded from this analysis. The opinion of market value developed herein is reflective of real estate only.
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REGIONAL AND MARKET AREA ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 13 Regional and Market Area Analysis

REGIONAL MAP
Overview
The property is located in Stanislaus County, which is in the northern portion of the San Joaquin Valley.

The San Joaquin Valley, along with the Sacramento Valley to the north, combine to form the great Central Valley of California, one of the most productive agricultural regions in the world. The area is known for its fertile soils and the agricultural abundance is supported by a temperate Mediterranean climate.

Population
Stanislaus County has seen population growth until 2021, historically from an influx of Bay Area commuters seeking relief from high-priced housing and congestion in the Bay Area. According to the State of California Department of Finance, the population of Stanislaus County as of January 1, 2023, was 545,939, a decrease of 0.5% over the previous year. Modesto is the largest city in the county.

According to ESRI projections, presented below, the county’s population is expected to increase annually 0.03% between 2023 and 2028, while Del Rio CPD will increase approximately 0.99% annually over the same period.
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REGIONAL AND MARKET AREA ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 14 Transportation
State Highway 99, and Interstate Route 5 (I-5), both of which are major north-south arterials, link Stanislaus County to other parts of California. Major east west highways include Highways 120, 108, and 132. In addition to the public transit system (bus service), and Greyhound Bus Lines, the Altamont Commuter Express (ACE) rail has stations in San Joaquin County to the northwest connecting to points in Alameda and Santa Clara counties. Additionally, the Bay Area Rapid Transit (BART) system extends easterly into Dublin, which is only a 60-minute drive west from major cities in Stanislaus County.

The Burlington Northern Santa Fe and Union Pacific Railroads provide freight service, while Amtrak provides passenger rail service for the area. Proximity to the Sacramento/San Joaquin Delta provides direct shipping access to both Sacramento and Stockton deep-water ports. The Modesto City-County Airport is located at the southern edge of the city and is the largest commercial airport in the county.

There are general aviation airports in Oakdale, Turlock, and Patterson. The nearest international airports are in Sacramento, Fresno and the San Francisco Bay Area.

Employment
Employment has experienced swings in recent years as the local economy has grown and then subsequently softened. Although the area has an economy that has been strongly tied to agriculture, total non-farm employment grew at a much faster pace than farm employment.

The largest employment sector in the county is the healthcare industry, with Emanuel Medical Center and Memorial Medical Center as some of the top employers. The second largest industry is the retail trade sector– E&J Gallo and Bronco Wineries have operations in the area. The third largest is the manufacturing sector. Major manufacturing employers include Del Monte Foods Inc., Frito Lay and Con Agra Foods Inc.

Population
Compound
Annual ∆
Compound
Annual ∆
Area 2020 - 2023 2023 - 2028
United States 331,449,520 335,707,897 0.43% 343,238,675 0.44% California 39,538,223 39,877,642 0.29% 40,140,276 0.13% Stanislaus County 552,878 557,562 0.28% 558,525 0.03%
Del Rio CDP 1,399 1,469 1.71% 1,538 0.99%
Source: ESRI (ArcGIS)
Census
Population
(2020)
Current
Population
(2023)
Projected
Population
(2028)
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REGIONAL AND MARKET AREA ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 15 Unemployment
The unemployment rate in Stanislaus County is the same rate as the state and higher than the rate of the nation. The County unemployment rate was 6.0% as of October 2023. The State of California was at 4.9% while the Nation was at 3.5% for the same time period. Unemployment rates locally and nationwide have been on a decreasing trend over the last several years, as shown in the table below.

Unemployment rates did increase in 2023 due to quantitative tightening in an effort by the Federal Reserve to curb inflation. On a national level, the unemployment rate is anticipated to hold around 4% over the next several years.

Employment by Industry for Stanislaus County - Source: ESRI (ArcGIS) 0% 2% 4% 6% 8% 10% 12% 14% 16%
Agriculture/Forestry/Fishing/Hunting
Mining/Quarrying/Oil & Gas Extraction
Construction
Manufacturing
Wholesale Trade
Retail Trade
Transportation/Warehousing
Utilities
Information
Finance/Insurance
Real Estate/Rental/Leasing
Professional/Scientific/Tech Services
Management of Companies/Enterprises
Admin/Support/Waste Management Services
Educational Services
Health Care/Social Assistance
Arts/entertainment/Recreation
Accommodation/Food Services
Other Services (excl Public Administration)
Public Administration
Unemployment Rates
Area YE 2018 YE 2019 YE 2020 YE 2021 YE 2022 2023¹
United States 3.9% 3.7% 8.1% 5.3% 3.6% 3.5%
California 4.2% 4.1% 10.1% 7.3% 4.2% 4.9%
Stanislaus County 6.5% 6.1% 11.0% 8.3% 5.4% 6.0%
Modesto 5.9% 5.5% 11.1% 8.0% 4.9% 6.0%
Source: www.bls.gov data not seasonally adjusted; ¹November - most recent for US, others lag by 1-2 mos.) #21..
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REGIONAL AND MARKET AREA ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 16 National Economic Overview
Economic growth surged through 2021, partially because of lower interest rates and $6.4± trillion in government borrowing/spending, in addition to an increase in consumer spending. As the national economy bounced back from an initial COVID shock, demand for employment (labor) increased, and wages grew.

Economic growth continued throughout 2022 and into 2023, despite rising inflation, higher interest rates, supply chain issues, and increasing energy prices, employment layoffs (particularly in the tech industry), and recession fears. Since March 2022, the Federal Reserve (“Fed”) raised the Federal Funds Rate eleven (11) times to bring down the rate of inflation. At their last two meetings, in September and November 2023, the Fed maintained the overnight Federal Funds Rate at 5.25% to 5.50%; a 25-basis point increase was previously made in July 2023. The collapses of Silicon Valley Bank, Signature Bank, and First Republic Bank have also led to an industry-wide tightening of credit (i.e., borrowing money).

Gross Domestic Product (GDP) increased modestly in the first half of 2023, at 2.2% and 2.1%, in the first and second quarters of 2023, respectively. In the July-through-September period, the economy grew by 4.9%. This spike is attributed largely to increases in consumer spending, which contributed 2.7 percentage points of the total GDP increase. Other contributing factors include inventory, exports, and government spending increases. It is noted that while consumer spending increased during the third quarter 2023, business spending (“nonresidential fixed investment”) declined. This rate of increase, however, is not expected to continue, and a slower growth rate is forecast through to the end of the year.

As of November 2023, the national unemployment rate was at 3.5%. Job growth continues to be strong (except for the technology sector), and the rate of inflation is moderating. The inflation rate was reported at 3.2%; excluding food and energy prices, inflation was reported at 4.0%.

Some economists continue to forecast a recession, but at lower probability, while others continue to forecast a “soft landing” or slow economic growth. The latest UCLA Anderson forecast foresees a weak economy in 2024, followed by growth in 2025. Risks, however, include geopolitical events, such as the ongoing war in Ukraine, but also the Israel-Hamas war, and potential national economic policy changes precipitated by a change party leadership in the upcoming 2024 presidential election.

Inflation Rate
Consumer demand surged following the “reopening of the economy” and from government stimulus payments in 2021 and 2022, and the rate of inflation accelerated beginning in Fall 2021. According to the Bureau of Labor Statistics, the Consumer Price Index (CPI) increased by 6.5% in total during 2022.

Price increases were observed in all areas – including gasoline, grocery, restaurant, and automobile prices. Businesses were also reporting higher labor costs, including vendor prices and costs for raw materials.

The rate of inflation, through October 2023, was reported at 3.2%. Excluding food and energy prices, inflation was reported at 4.0%. While still elevated, but closer to the Fed’s targeted 2.0% range, the inflation rate appears to be falling because of the aggressive interest rate increases made throughout 2022 and into 2023.
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REGIONAL AND MARKET AREA ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 17 Federal Funds Rate
The Fed has pursued the action of raising the interest rate at the fastest pace in 40 years, with seven rate increases throughout 2022, followed by four rate increases throughout 2023. The Fed’s goal is to bring inflation closer to the target range of 2%. The underlying theory is that as interest rates increase, the cost of borrowing increases – which, in turn, diminishes the available credit to the market, causing downward pressure on asset prices, including real estate. Increasing rates, historically, have also placed upward pressure on capitalization rates, albeit not
immediately.

As the cost of borrowing increases, the amount of
money that real estate purchasers can finance
decreases. Additionally, investors are looking for a
return on their investment, or yield. As the Federal
Funds Rate increases, so do coupon rates of U.S.

Government bonds, which has historically been
perceived as being “risk free,” since it is assumed that the U.S. Government would not default on its debts.

The result is a flight of capital to the perceived safety of bonds – and away from real estate investment.

Beginning March 2022, the Fed began raising the
interest rate, for the first time in three years, to
temper the rapid inflation growth. The initial rate
increase was 25 basis points. Further rate increases
followed: by 50 basis points in May 2022; then by 75
basis points on each occasion, in June, July,
September and November 2022; by 50 basis points
in December 2022, and by 25 basis points on each
occasion in February, March, and May 2023.

In June 2023, the Fed made the decision to temporarily pause the interest rate increases; a rate increase of 25 basis points, however, was made in July 2023. At their most recent meetings in September, November, and December 2023, the decision was made to leave the rate unchanged. The benchmark interest rate currently is at 5.25% to 5.50%.

Silicon Valley Bank, Signature Bank, First Republic Bank Collapses On March 10 and 12, respectively, Silicon Valley Bank and Signature Bank were placed into Federal government (FDIC) receivership. In a joint statement, the FDIC and the Fed, along with Secretary Yellen, guaranteed that all bank account holders would have access to their money.

Silicon Valley Bank was mostly tied to the tech sector. Because tech demand was high during the post pandemic period, numerous start-up companies received huge cash investment from venture capital firms and used the banks’ services to hold their influx of funds. But with the mass layoffs and uncertainty in the tech sector, account holders began to withdraw funds from the bank.

The collapse happened for multiple reasons, with the main one being a lack of diversification of the bank’s investments, which largely consisted of long-term U.S. Treasury bonds and mortgage-backed Date Target Range (%) Basis Point
Change
Mar-20 1.00% - 1.25% -50
Mar-20 0.00% - 0.25% -100
Apr-20 0.00% - 0.25% 0
Mar-22 0.25% - 0.50% +25
May-22 0.75% - 1.00% +50
Jun-22 1.50% - 1.75% +75
Jul-22 2.25% - 2.50% +75
Sep-22 3.00% -3.25% +75
Nov-22 3.75% - 4.00% +75
Dec-22 4.25% - 4.50% +50
Feb-23 4.50% - 4.75% +25
Mar-23 4.75% - 5.00% +25
May-23 5.00% - 5.25% +25
Jun-23 5.00% - 5.25% 0
Jul-23 5.25% - 5.50% +25
Sep-23 5.25% - 5.50% 0
Nov-23 5.25% - 5.50% 0
Federal Funds Rate
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REGIONAL AND MARKET AREA ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 18 securities. To help fund the mass withdrawals, Silicon Valley Bank prematurely sold a $21 billion bond portfolio, at a $1.8 billion loss – due to a result of rising interest rates. [When interest rate rises, the value of the bond decreases on for-sale secondary markets. This is because the existing bond competes with newer bonds with higher interest rates.] To cover these losses, the bank tried to sell $2.25 billion in equity and stock – which, in turn, scared additional clients to withdraw funds from the bank and panicked investors into selling the bank’s parent company stock shares.

Signature Bank was shut down by federal regulators two days after the collapse of Silicon Valley Bank.

Its failure resulted after bank customers withdrew billions of dollars in the aftermath of SVB’s collapse.

First Republic Bank, a San Francisco-based regional bank that focused on high-net-worth clients, failed on May 1, 2023. Most of its business was sold to JP Morgan Chase after federal regulators shut down the bank. The reason for its failure was for many of the same reasons that Silicon Valley Bank and Signature Bank collapsed, including: (1) uninsured deposits (i.e., at amounts greater than the $250,000 that is FDIC-insured); (2) lack of liquidity – with net interest income coming from real estate mortgage loans and municipal bonds; and (3) credit rating downgrades.

According to an investigative report by the Fed, the failure of Silicon Valley Bank is attributed to poor management, watered-down regulations, and lax oversight. As SVB grew, banking supervisors were slow to recognize the problems that contributed to its downfall – including an increasing number of uninsured deposits and inadequate investment portfolios to protect against rapidly changing interest rates. Once identified, supervisors appeared to be unwilling to address the issues, partly due to lightened banking standards issued by Congress and the Fed in 2018 and 2019.

We note that the collapse of these banks appears to be isolated and not indicative of the beginning of a wider event. Most other banks that have a diversified holding of investments appear to be secure for account holders and investors. It is anticipated that the sale of First Republic Bank to JP Morgan Chase should stabilize the banking sector. And while federal regulators have tried to reassure investors that “the worst is over,” there exists a mistrust of smaller regional banks.

The California Forecast
The California economy is growing faster than the national economy. Jobs were lost in some sectors and created in others, and some jobs moved out of state as a result of remote work. Employment sectors with the largest numbers of new jobs were (1) health care and social services; (2) public and private education; (3) construction; (4) leisure and hospitality: and (5) durable goods manufacturing.

Ot these, construction and durable goods manufacturing are on average higher wage sectors.

Total unemployment (yearly average rate) for 2023, 2024, and 2025 is forecast to be at 4.5%, 4.7%, and

4.6%, respectively. Real income is forecast to overall decrease by 0.2% in 2023 but increase by 1.2% and 2.0% respectively in 2024 and 2025.

Risks to the forecast, as in the national forecast, are political and geopolitical.

Concluding Remarks
Between March 2022 and July 2023, to combat inflation the Fed raised the benchmark interest rate eleven times; at their last two meetings, the Fed decided to hold the interest rate steady at 5.25% to

5.50%. The collapses of Silicon Valley Bank, Signature Bank, and First Republic Bank has also led to an #21..
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REGIONAL AND MARKET AREA ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 19 overall bank industry-wide credit tightening. The combination of stricter lending standards and higher interest rates will impact the national, statewide, and local real estate markets.

In the near term, market participants will likely execute very few transactions. Debt rates are increasing rapidly; we have observed pending sale transactions of commercial real estate that have fallen out of escrow while buyers were seeking financing. We expect to see more creative financing, such as sellercarried financing, loan assumptions, and wrap mortgages – as examples, when deals do close.

It is likely that only the best properties will trade in 2023 and into 2024. High-quality tenancies with long-term leases remain the most sought-after investments. Lower-quality properties that can be assembled into development sites as large as one-acre, or greater, will likely reflect land value for other commercial real estate sectors, such as life sciences, multi-family residential, or mixed uses.

Median Household Income
Total median household income for the region is presented in the following table. Overall, the subject’s MSA and county compare unfavorably to the state and similar to the country.

Conclusions
There remains a significant pricing differential between the Central Valley and the Bay Area and demand for all property types in the Valley is expected to continue. The intrinsic desirability of the region, a diverse economic base, historically strong long-term job and population growth provide strong support for real estate values and their potential for long-term appreciation.

With respect to commercial and residential real estate, increasing interest rates began to stifle transaction volumes in mid-2022, a trend that has continued without much change into mid-2023.

Banks and institutional lenders have not been active for some time, leaving financing to private money lenders and cash buyers. Loan interest rates, where loans are available, have essentially doubled, leaving buyers to demand higher rates of return. While some distress is emerging, particularly in the office segment, sellers are mostly unwilling to transact at lower prices, keeping market participants in a wait and see posture. Reports indicate that once inflation has stabilized and interest rates can be projected with more certainty, transaction volumes will likely increase. In any case, the historic reasons for growth in the region remain the same, and, thus, the expectation is that normal growth will resume over time.

Income
2023 Median 2023 Average 2023 Per Capita
Area HH Income HH Income Income
United States $72,233 $104,831 $41,000
California $89,455 $131,660 $45,201
Stanislaus County $76,031 $102,886 $32,982
Del Rio CDP $156,733 $244,832 $89,333
Source: ESRI (ArcGIS)
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CITY AND NEIGHBORHOOD ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 20 City and Neighborhood Analysis

NEIGHBORHOOD MAP
The subject is located in an unincorporated area of Stanislaus County and within the sphere of influence of the City of Modesto. As such, we have provided an overview of the City of Modesto below.

Overview
As the largest city in the county, Modesto serves as Stanislaus County's retail, government, medical, and employment center. Surrounded by small cities and farmland, Modesto is located approximately 90 miles east of San Francisco, 80 miles south of Sacramento, 110 miles west of Yosemite National Park, and 95 miles northwest of Fresno.

Critical inter-regional links are provided by two major north-south highways (Interstate 5 and Highway 99) and two east-west highways (State Route 108 and 132). These highways, along with a network of local, county, and state routes, provide an efficient road network for the area. Over 90 truck lines serve the area.

The City of Modesto is a slowly growing community with good appeal given the relatively close commuting distance to the Bay Area and Sacramento MSA and the lower cost of living of the region.

Modesto has a centralized location in the Central Valley region with good freeway access. The local economy is dominated by agriculture; however, there has been increased demand for the region in #21..
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CITY AND NEIGHBORHOOD ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 21 recent years due to the lower cost of living. The local economy continues to struggle with high unemployment. The residential market is improving, while the commercial markets are still sluggish.

Neighborhood Location and Boundaries
The subject neighborhood is located in the northern section of Modesto. The neighborhood is bounded by East River Road to the north, Oakdale Road to the east, Highway 219 to the south, and Highway 99 to the west.

Transportation Access
Within the immediate area of the subject, transportation access helps define the character of its development. Major travel and commuter routes within the area of the property include Highways 108, 120, 99, and 219. Access to the area is considered average.

Demographics
The following table depicts the area demographics in Modesto within a one-, three-, and five-mile radius from the subject. Within a three-mile radius, the reported population is 11,554 with a projected growth rate of approximately 0.1% annually. There are 3,999 housing units within that three-mile radius. Most of the housing is owner-occupied.

Neighborhood Demographics
Radius (Miles) 1 Mile 3 Mile 5 Mile
Trade Area (Sq. Mi.) 3.14 28.27 78.54
Trade Density (Pop/Sq. Mi.) 360 409 1,335
Population
Census Population (2010) 987 10,590 96,622
Census Population (2020) 1,082 11,516 103,570
Current Population (2023) 1,129 11,554 104,826
Projected Population (2028) 1,179 11,616 105,713
Compound Annual Growth
2010 - 2020 0.9% 0.8% 0.7%
2020 - 2023 1.4% 0.1% 0.4%
2023 - 2028 0.9% 0.1% 0.2%
Households
Census Households (2010) 394 3,569 33,576
Census Households (2020) 413 3,843 35,594
Current Households (2023) 435 3,876 36,135
Projected Households (2028) 455 3,910 36,511
Compound Annual Growth
2010 - 2020 0.5% 0.7% 0.6%
2020 - 2023 1.7% 0.3% 0.5%
2023 - 2028 0.9% 0.2% 0.2%
Average Household Size (2023) 2.60 2.95 2.88
Source: ESRI (ArcGIS) (Lat: 37.747051, Lon: -120.997878) #21..
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CITY AND NEIGHBORHOOD ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 22 Within a three-mile radius, the median household income is $104,634. The average income figures suggest that the inhabitants are within the middle income bracket.

Neighborhood Demographics (cont.)
Radius (Miles) 1 Mile 3 Mile 5 Mile
Trade Area (Sq. Mi.) 3.14 28.27 78.54
Trade Density (Pop/Sq. Mi.) 360 409 1,335
2023 Housing Units
Median Home Value $845,506 $561,199 $458,132
Median Year Built 1979 1991 1982
Total Housing Units 459 3,999 37,285
Owner-Occupied Housing % 86.9% 72.0% 61.6%
Renter-Occupied Housing % 7.8% 25.0% 35.3%
Vacant Housing % 5.2% 3.1% 3.1%
2023 Employment
Total Establishments 32 659 3,222
Total Employees 224 7,265 31,370
Average Commute Time n/a n/a n/a
% College Graduates 54.2% 29.0% 24.6%
2023 Income Summary
Median Household Income $155,052 $104,634 $83,965
Average Household Income $241,165 $146,041 $115,507
Avg Spending/Household $61,421 $39,896 $31,347
Per Capita Income $87,505 $47,608 $39,754
Source: ESRI (ArcGIS) (Lat: 37.747051, Lon: -120.997878) #21..
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CITY AND NEIGHBORHOOD ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 23 Immediate Area Uses
The below aerial photo exhibits the uses located in the subject’s immediate vicinity.

IMMEDIATE AREA USES
Source: Google Maps
The area around McHenry Avenue appears to be in a stage of growth. To the north of the property is an orchard and further north is the Stanislaus River. To the east of the property are a mix of smaller rural residential properties and larger scale orchards. To the south of the property is a subdivision that was built in the late 1990s and early 2000s. Further south is more agricultural lands, primarily orchards.

To the west of the property is a subdivision that was built in the 1980s and further west is the Del Rio Country Club. Most of the homes in this area are in good condition.

The immediate area is known as Del Rio. Del Rio is known for multi-million dollar luxury homes on large lots. Home values in the Del Rio area range between the low $1,000,000 to over $3,000,000, with homes sizes in the 3,000 to over 5,000 square foot range. Many business professionals (including doctors, lawyers, and business owners) live in the Del Rio area and commute to Modesto for employment. Market participants report a dearth of available homes for sale and significant demand for housing within this area.

The property also benefits from its proximity to the City of Riverbank, which is less than three miles to the southeast, and the City of Modesto, which is less than 4 miles south. The proximity to more #21..
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CITY AND NEIGHBORHOOD ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 24 developed cities allows for residential users to be close to all necessities while still living in a more rural area with lower density housing.

Analysis and Conclusions
The neighborhood is characterized by a mixture of agricultural lands and residential areas along McHenry Avenue. Access to the area is considered average with Highways 108, 120, 99, and 219 in the vicinity of the property. The future outlook of the neighborhood is positive. #21..
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SITE DESCRIPTION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 25 Site Description: Entire Property
The property is located along the west side of McHenry Avenue, one parcel north of Stewart Road, in an unincorporated area of Stanislaus County. The following describes the Entire Property.

Site Characteristics
Address: 7111 McHenry Avenue, Modesto, CA 95356
Gross Land Area: 82.01 Acres or 3,572,356 SF, based on the plat map.

Usable Land %: 100.0%
Shape: Generally rectangular
Average Depth: 1,268 feet
Topography: Level
Drainage: Assumed adequate
Grade: At street grade
Utilities: Well, septic, and PG&E onsite
Off-Site Improvements: McHenry Avenue is a fully improved asphalt paved roadway with curbs and gutters; there are no sidewalks or streetlights. This roadway carries two lanes of traffic in each direction north and south.

Interior or Corner: Interior
Signalized Intersection: There is no signalized intersection at the site.

Street Frontage / Access
Frontage Road Primary
Street Name: McHenry Avenue
Street Type: Local
Frontage (Linear Ft.): 2,862
Number of Curb Cuts: 1
Traffic Count (Cars/Day): 14,358
Flood Zone Data
Flood Map Panel/Number: 06099C0330E
Flood Map Date: 09-26-2008
Flood Zone: Zone X
Flood Zone X includes areas of minimal flood hazard, which are outside a Special Flood Hazard Area and higher than the elevation of the 0.2%-annual-chance flood.

Site Area in Flood Hazard Area: None

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SITE DESCRIPTION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 26 Other Site Conditions
Soil Type: The property is comprised of mainly Hanford sandy loam and Oakdale sandy loam, both of which are Grade 1 soils. There is also a smaller portion (less than 5%) of the property that is comprised of Delhi sand, a Grade 3 soil. The subject soils are suitable for agricultural use. We note that neighboring orchard properties have the same or very similar soils.

Environmental Issues: A Phase I Environmental Site Report was not provided for review.

We make no representations as to the presence of toxins and hazardous materials on the site. We are appraising the site as if clean. If this is of concern to any reader of this report, it is our recommendation that an environmental report is obtained from the appropriate professionals qualified to issue such opinions.

Easements/Encroachments: We were provided with a Preliminary Title Report from Chicago Title Company (document #FSST-5112201569) dated September 28, 2023.

The Preliminary Report shows the Entire Property to be
encumbered by a public utility easement (telephone pole guy wire and anchor) and electrical facility easement for the Modesto Irrigation District near the southeast corner. There is also a public road and highway easement along the eastern portion of the property abutting McHenry Avenue.

The public road and highway easement does reduce the net square footage of the Well 70 Treatment Parcel from 14,426 square feet (gross) to 10,826 square feet (Net).

Earthquake Zone: While all of California is prone to earthquakes, the property is not in an Alquist Priolo fault zone.

Adjacent Land Uses
North: Orchard and Stanislaus River
South: Single-family residential neighborhood and Stewart Road East: McHenry Avenue and orchards
West: Single-family residential neighborhood
Site Ratings
Access: Average
Visibility: Average
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SITE DESCRIPTION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 27 Zoning Designation
Zoning Jurisdiction: Stanislaus County
Zoning Classification: Planned Development
General Plan Designation: Planned DevelopmentAgriculture Permitted Uses: The existing agricultural use is a grandfathered use. A new Planned Development permit would be required for any other use.

Zoning Comments: The property had a previous Tentative Map in 1989 for a 92-lot residential subdivision. As part of the entitlement process, the zoning was changed to PD(189); however, the tentative map never recorded and this zoning has expired according to county planning. Kristen Anaya, associate appraiser with the county noted that the zoning remains a Planned Development rather than agriculture. It is reasonably probable that the county would approve a Rezoning and new Tentative Map for a residential subdivision on the property which allows residential lots of at least 20,000 square feet in size. CEQA review and County Board of Supervisors approval is required for a new subdivision on the subject.

Analysis/Comments on Site
The site consists of a single parcel located along the west side of McHenry Avenue in unincorporated Stanislaus County within the sphere of influence of the City of Modesto. The site has a generally rectangular shape and an interior lot configuration one parcel north of Stewart Road. The site has approximately 2,862 feet of frontage along McHenry Avenue. The underlying site contains 82.01 acres.

The property zoning and the General Plan land use designation are Planned Development. The property had a previous Tentative Map for a residential subdivision; however, the map never recorded and has since expired, but we conclude it is reasonably probable that the county would approve a residential subdivision on the property which allows residential lots of at least 20,000 square feet in size.

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PLAT MAP
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SITE DESCRIPTION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 29 PLAT MAP OF THE WELL 70 TREATMENT PARCEL
(PREPARED BY NORTH STAR ENGINEERING GROUP, INC. DATED DECEMBER 21, 2023) #21..
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SUBDIVISION MAP (NO CURRENT APPROVALS)
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IMPROVEMENTS DESCRIPTION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 31 Improvements Description
The property is improved with a mixed age almond orchard and several support structures. The improvements are near the end of their useful lives but are an interim use of the property until the site is redeveloped to its highest and best use.
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SUBJECT PHOTOGRAPHS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 32 Subject Photographs (Dated January 4, 2024)
Ground view of the Well 70 Treatment Parcel
View looking north on the Well 70 Treatment Parcel
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SUBJECT PHOTOGRAPHS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 33 View looking south from the Well 70 Treatment Parcel
View looking towards the Well 70 Treatment Parcel from across McHenry Avenue #21..
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ASSESSMENT AND TAX DATA
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 34 Assessment and Tax Data
Assessment Methodology
The State of California has a unified system to assess real estate for property taxes. Assessment Districts are established on a county basis to assess real estate within the county. The appraised property falls under the taxing jurisdiction of Stanislaus County and is subject to both general taxes and direct assessments.

Assessed Values and Property Taxes
The subject’s assessed values, applicable tax rate and total taxes including direct assessments are shown in the following table:

General Taxes
The amount of general taxes due is quantified by multiplying the assessed value by the tax rate. In the State of California, real estate is assessed at 100% of market value as determined by the County Assessor’s Office. The tax rate consists of a base rate of 1% plus any bonds or fees approved by the voters. The County tax rate for the subject property is 1.129977%.

Direct Assessments
Direct assessments are tax levies that are not dependent upon the assessed value of the property. They are levied regardless of assessed value. According to the Stanislaus County Tax Collector’s Office, there is one direct assessment for the property, which totals $45.20 and is levied by Salida Fire District.

Current and Future Taxes
Proposition 13 was passed by voters in June 1978 and substantially changed the taxation of real estate in California. This constitutional amendment rolled back the base year for assessment purposes to the tax year 1975-1976. Annual increases in assessed value are limited to 2 percent per year, regardless of the rate of inflation. Real estate is subject to re-appraisal to current market value upon a change in ownership or new construction. Property assessments in years subsequent to a change of ownership or new construction are referred to as factored base values.

Conclusions
According to the Stanislaus County Tax Collector’s Office the property’s taxes are current as of the date of value.

Tax Schedule
Parcel
Assessor's
Appraised
Assessor's
Appraised Assessor's Total Tax Special Tax
Tax Year Number Value - Land Value - Imp. Appraised Value Rate Assessments Expense 2023 004-102-005 $4,281,102 $0 $4,281,102 1.12998% $45 $48,674 #21..
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MARKET AREA MAP
The subject is vacant residential subdivision land in a high-end residential area known as Del Rio which has large luxury homes on large lots. As such, an examination of the residential land market is warranted.

Residential Land Market
Residential land values are directly tied to supply and demand of current housing products. Land values vary depending on location, size, permitted uses, and allowable density. Unfortunately, there are no meaningful statistics for residential land values in Stanislaus County and the property’s submarket of Modesto. We note that median sales prices did stabilize or decrease on a national scale recently due to high interest rates. Stanislaus County and the City of Modesto are both experiencing slow growth and home prices are expected to be stable over the next year.

The table below shows MLS statistics for single-family home median sale price in Stanislaus County and Modesto between 2019 and 2023. These statistics suggest an average annual increase in median home sale prices of ±10% between 2019 and 2022 followed by no change starting in 2022 which corresponds to rising interest rates and higher borrowing costs. #21..
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MARKET ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 36 Residential land is typically purchased contingent on project approval or with entitlements (tentative or final map) in place. When contingent upon approvals, the risk to a developer is significantly reduced, putting upward pressure on the price. Prices for land purchased without this contingency are typically lower than for land purchased on a contingency. The price differential is especially large as the risk increases. We note that citizen participation in planning activities is very high in certain municipalities; thus, the approval process for residential projects can become political, long and arduous.

Buyer types range from the individual developer to the large-scale national housing developer, depending on the size of the site. Well-located, small sites are still in demand from small local buyers, while national builders are very actively seeking land sites that are over three acres in size. If a property has easy access, no topographic or geologic issues, and has infrastructure available, the property will be in greater demand.

Low-density residential land values in Modesto and surrounding cities are generally in the $5.00 to $15.00+ per square foot range depending on location and entitlements. Oftentimes, residential land is valued on the basis of price per unit as opposed to price per square foot, particularly for entitled sites.

Based on this metric, residential land prices in Modesto and surrounding cities currently range between $20,000 to $100,000+ per unit for entitled sites. The range is highly dependent upon density and location.

We have found that there is an inverse relationship between density and price per unit prices.

The following graph for the S&P/Case-Shiller San Francisco Home Price Index shows an increasing trend in housing prices until summer of 2022. Demand for housing had increased through the economic recession stemming from the Covid-19 pandemic which led to an increase in demand for residential development land. However, prices began trending downward in June 2022 which corresponds with the federal funds rate increases as the Fed initiated quantitative tightening to curb inflation. The increased federal funds rate led to high mortgage rates.

Year Median Sale Price % Change Median Sale Price % Change 2019 $329,500 $309,900
2020 $364,000 10.47% $345,000 11.33%
2021 $427,700 17.50% $415,000 20.29%
2022 $457,000 6.85% $440,000 6.02%
2023 $460,000 0.66% $440,000 0.00%
Single-Family Home Median Sale Price
Stanislaus County Modesto
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MARKET ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 37 Underlying employment conditions are a barometer of the health of the economy. The chart below from the U.S. Bureau of Labor Statistics shows improvements to the employment market until a steep drop in 2020 corresponding to the Coronavirus pandemic and shelter in place orders. As of the valuation date, employment was on the rise and unemployment was near an all-time low. There is a labor shortage with not enough qualified employees to fill new openings.

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MARKET ANALYSIS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 38 During the development of this appraisal and in recent past assignments we have spoken with knowledgeable land brokers including Larry Killian (Owner/Broker) with Killian Real Estate, Naomi Valadez (agent) with Craft & Bauer Real Estate Co., Christian Coronel (agent) with NT Real Estate, and Kevin Beyer (agent) with HomeSmart PV & Associates. Market participants have reported that demand has slowed over the past year for residential development land due to high interest rates and stabilized to downward trending home sale prices. Mr. Killian noted that the subject has a highly desirable Del Rio location which is known for upscale luxury homes with large square footages on large lots.

Overall Market Analysis Conclusion
As of the valuation date, the residential market has slowed down due to high interest rates. Still, investor and developer demand for residential land in the Central Valley is considered good. Likely, we will continue to see a slowing trend for the Stanislaus County residential market in the near term. #21..
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HIGHEST AND BEST USE
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 39 Highest and Best Use: Entire Property
The Highest and Best Use of a property is the use that is legally permissible, physically possible, and financially feasible which results in the highest value. An opinion of the highest and best use results from consideration of the criteria noted above under the market conditions or likely conditions as of the effective date of value. Determination of highest and best use results from the judgment and analytical skills of the appraiser. It represents an opinion, not a fact. In appraisal practice, the concept of highest and best use represents the premise upon which value is based.

Analysis of Highest and Best Use As If Vacant
The primary determinants of the highest and best use of the property as if vacant are the issues of (1) Legal permissibility, (2) Physical possibility, (3) Financial feasibility, and (4) Maximum productivity.

Legally Permissible
The subject site zoning and General Plan land use designation are Planned Development which controls the general nature of permissible uses but is appropriate for the location and physical elements of the property, providing for a consistency of use with the general neighborhood. The location of the property is appropriate for the uses allowed, as noted previously. A change in zoning is not likely.

A Tentative Map and subdivision application for a 92-lot residential subdivision was submitted to County planning in 1989; however, the map was never recorded. Planning stated that the PD(189) zoning which supports single-family residential use is now expired. Future single-family residential subdivision development of the site is reasonably probable and is contingent on the City of Modesto well site expansion (on the Well 70 Treatment Parcel).

Physically Possible
The physical attributes allow for a number of potential uses. Elements such as size, shape, availability of utilities, known hazards (flood, environmental, etc.), and other potential influences are described in the Site Description and have been considered. There are no items of a physical nature which would adversely impact development with the legal permitted uses.

Financially Feasible
The probable use of the Entire Property for residential development conforms to the pattern of land use in the market area. The single-family home market has slowed over the past year in the Modesto area due to increasing mortgage rates. Mortgage rates are anticipated to decrease in 2024 and 2025.

Brokers have confirmed good demand for residential properties due to low supply. Therefore, nearterm speculative development of the Entire Property is financially feasible. We know of several nearby subdivisions that are currently under construction which supports this conclusion.

Maximally Productive
Among the financially feasible uses, the use that results in the highest value (the maximally productive use) is the highest and best use. Considering these factors, the maximally productive use of the subject, as vacant, is for single-family residential subdivision.

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HIGHEST AND BEST USE
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 40 Conclusion of Highest and Best Use As If Vacant
The conclusion of the highest and best use as if vacant is for single-family residential subdivision.

Analysis of Highest and Best Use As Improved
In determining the highest and best use of the property as improved, we consider three possibilities for the property: 1) continuation of the existing use with or without modification to improvements, 2) a change in use, or 3) demolition and redevelopment of the land.

Retaining the improvements as they exist meets the tests for physical possibility, legal permissibility and financial feasibility. The subject improvements were built in the 1950s and, as of the date of value, were near the end of their useful lives. Additionally, the existing improvements are an underutilization of the site.

The market value of the property as improved does not exceed the combination of vacant site value less cost of demolition of the improvements. Therefore, demolition and redevelopment of the site is maximally productive.

Conclusion of Highest and Best Use As Improved
The highest and best use of the property, as improved, is future single-family residential subdivision redevelopment at the maximum allowed density.

Most Probable Buyer
As of the date of value, the most probable buyer of the subject is a developer. #21..
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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 41 Land Valuation: Entire Property
Introduction
To provide a brief valuation overview, we first utilize the sales comparison approach to estimate the current value of the entire 82.01-acre Entire Property, then we apply the indicated price per square foot to estimate the contributory value of the Well 70 Treatment Parcel.

Entire Property - Sales Comparison Approach
Methodology
Site value is most often estimated using the sales comparison approach. This approach develops an indication of market value by analyzing closed sales, listings, or pending sales of properties similar to the subject, focusing on the difference between the subject and the comparables using all appropriate elements of comparison. This approach is based on the principles of supply and demand, balance, externalities, and substitution, or the premise that a buyer would pay no more for a specific property than the cost of obtaining a property with the same quality, utility, and perceived benefits of ownership.

Unit of Comparison
The unit of comparison depends on land use economics and how buyers and sellers use the property.

The unit of comparison in this analysis is price per square foot of land.

Elements of Comparison
Elements of comparison are the characteristics or attributes of properties and transactions that cause the prices of real estate to vary. The primary elements of comparison considered in sales comparison analysis are as follows: (1) property rights conveyed, (2) financing terms, (3) conditions of sale, (4) market conditions, (5) location, and (6) physical characteristics.

Comparable Sales Data
To obtain and verify comparable sales of residential land properties, we conducted a search of public records, field surveys, interviews with knowledgeable real estate professionals in the area, and a review of our internal database. We included several sales in our analysis, as these sales were judged to be the most comparable to develop an indication of market value for the Entire Property.

The following is a table summarizing each sale comparable and a map illustrating the location of each in relation to the subject. Details of each comparable follow the location map. #21..
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COMPARABLE SALES MAP
Land Sales Summary
Comp. Gross Sales Price Per
No. COE Date Acres Location Zoning Actual Sq. Ft.
1 January-22 56.460 Santa Fe Avenue & East Hatch Road Hughson C-2, R-1, R-2 $16,610,000 $6.75 2 May-22 106.310 697 North Airport Way Manteca R-1 & P $22,800,000 $4.92 3 January-22 18.800 Santa Fe Street & Snedigar Road Riverbank R-1 $5,100,000 $6.23 4 December-20 19.700 3007 East Tuolumne Road Turlock RL $4,875,000 $5.68 5 Listing 82.010 7111 McHenry Avenue Modesto A-2-40 $20,000,000 $5.60 #21..
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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 43 COMPARABLE SALE 1
Property Identification
Property Name Parkwood Subdivision
Address Santa Fe Avenue & East Hatch Road
City, State Zip Hughson, California 95326
County Stanislaus
Latitude/Longitude 37.607283/-120.878537
Tax ID 018-017-002, -010, -014
Transaction Data
COE Date January 2022
Sale Status Recorded
Grantor Parkwood Hughson LLC
Grantee KB Home North Bay LLC
Recording Number 6172
Sale Price $16,610,000
Property Description
Gross Acres 56.46
Gross SF 2,459,398
Corner/Interior Interior
Shape Irregular
Use Designation General Commercial, Low
Density Residential,
Medium Density
Residential
Zoning Jurisdiction City of Hughson
Zoning Code C-2, R-1, R-2
Zoning Description General Commercial, Low
Density Residential,
Medium Density
Residential
Indicators
$/Gross SF $6.75

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 44 Remarks X
This property is known as the Parkwood Subdivision. The property consists of three parcels located along Santa Fe Avenue and East Hatch Road in Hughson. The site has an irregular shape and an interior lot configuration. The site has approximately 1,680 feet of frontage along Santa Fe Avenue and approximately 2,125 feet of frontage along East Hatch Road. The site contains 56.46 acres or 2,459,398 square feet. The property zoning and General Plan land use designation is evenly split between General Commercial (C-2), Low Density Residential, and Medium Density Residential.

KB Home North Bay LLC Parkwood Hughson LLC purchased this property in January 2022 from Parkwood Hughson LLC. The property sold for $16,610,000 or $6.75 per square foot of land. The property was purchased by a developer. At the time of sale, the property had an approved Tentative Map with 299 proposed single-family residences. The lots will range from 5,005 square feet to 13,280 square feet. The project also includes a 6.14 acre park as well as circulation and utility infrastructure improvements.

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 45 COMPARABLE SALE 2
Property Identification
Property Name Villa Ticino Subdivision
Address 697 North Airport Way
City, State Zip Manteca, California 95337
County San Joaquin
Latitude/Longitude 37.808870/-121.257841
Tax ID 198-160-210 and -290
Transaction Data
COE Date May 2022
Sale Status Recorded
Grantor Jen California 23 LLC
Grantee Richmond American
Homes of Maryland
Sale Price $22,800,000
Property Description
Gross Acres 106.31
Gross SF 4,630,864
Corner/Interior Interior
Shape Irregular
Use Designation Low Density Residential,

2.1 - 8 du/ac (LDR) & Park
(P)
Zoning Jurisdiction City of Manteca
Zoning Code R-1 & P
Zoning Description One-Family Dwelling &
Park
Indicators
$/Gross SF $4.92

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 46 Remarks X
This property is known as the Villa Ticino Subdivision. The property consists of two parcels located on the west side of North Airport Way and the south side of West Louise Avenue in Manteca. The site has an irregular shape and an interior lot configuration. The site has approximately 1,673 feet of frontage along North Airport Way and approximately 605 feet of frontage along West Louise Avenue. The site contains 106.31 acres or 4,630,864 square feet. The property zoning is One-Family Dwelling (R-1) & Park (P) and the General Plan land use designation is Low Density Residential, 2.1 - 8 du/ac (LDR) & Park (P).

The property has an approved Tentative Map. The property is part of a larger project approved for 760 single-family residences on 182.46 acres. The homes are between 2,000 square feet and 3,200 square feet.

The homes are selling for between $600,000 and $750,000.

Richmond American Homes of Maryland (KB Home North Bay LLC) purchased this property in May 2022 from Jen California 23 LLC. The property sold for $22,800,000 or $4.92 per square foot of land. The property was purchased by a developer. At the time of sale there was an approved Tentative Map and rough grading had been completed but there were no offsites.

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 47 COMPARABLE SALE 3
Property Identification
Property Name Diamon Bar East Subdivision
Address Santa Fe Street & Snedigar Road
City, State Zip Riverbank, California 95367
County Stanislaus
Latitude/Longitude 37.734571/-120.914769
Tax ID 062-020-010 and -025
Transaction Data
COE Date January 2022
Sale Status Recorded
Grantor MCroy-Wilbur
Communities, Inc.

Grantee LGI Homes California LLC
Recording Number 6832
Sale Price $5,100,000
Property Description
Gross Acres 18.80
Gross SF 818,928
Corner/Interior Corner
Shape Irregular
Use Designation Low Density Residential, 0-
8 -du/ac (LDR)
Zoning Jurisdiction City of Riverbank
Zoning Code R-1
Zoning Description Single Family Residential
Indicators
$/Gross SF $6.23

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 48 Remarks X
This property is known as the Damon Bar East Subdivision. The property consists of two parcels located along the south side of Santa Fe Street and the west side of Snedigar Road in Riverbank. The site has an irregular shape and an interior lot configuration. The site has approximately 825 feet of frontage along Santa Fe Street and approximately 690 feet of frontage along Snedigar Road. The site contains 18.80 acres or 818,928 square feet. The property zoning is Single Family Residential (R-1) and the General Plan land use designation is Low Density Residential, 0-8 -du/ac (LDR).

LGI Homes California LLC purchased this property in January 2022 from MCroy-Wilbur Communities, Inc.

The property sold for $5,100,000 or $6.23 per square foot of land. The property was purchased by a developer. At the time of sale, the property had an approved Tentative Map for 83 single-family homes.

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 49 COMPARABLE SALE 4
Property Identification
Address 3007 East Tuolumne Road
City, State Zip Turlock, California 95382
County Stanislaus
Latitude/Longitude 37.516139/-120.813026
Tax ID 073-016-004
Transaction Data
COE Date December 2020
Sale Status Recorded
Grantor RBK Development
Grantee KB Home North Bay LLC
Recording Number 109002
Sale Price $4,875,000
Property Description
Gross Acres 19.70
Gross SF 858,132
Corner/Interior Corner
Shape Rectangular
Use Designation Very Low Density
Residential
Zoning Jurisdiction City of Turlock
Zoning Code RL
Zoning Description Low Density Residential
Indicators
$/Gross SF $5.68

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 50 Remarks X
This property consists of a single parcel located along the north side of East Tuolumne Road and along the west side of North Waring Road in Turlock. The site has a rectangular shape and a corner lot configuration.

The site has approximately 650 feet of frontage along East Tuolumne Road and approximately 1,305 feet of frontage along North Waring Road. The site contains 19.70 acres or 858,132 square feet. The property zoning is Low Density Residential and the General Plan land use designation is Very Low Density Residential.

KB Home North Bay LLC purchased this property in December 2020 from RBK Development. The property sold for $4,875,000 or $5.68 per square foot. The property was purchased by a developer. The property had an approved Tentative Map as of February 2015 with 60 single family residences. The map was inclusive of open space and a storm drainage area. The buyer intended to complete the entitlement process and develop the property.

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 51 COMPARABLE SALE 5 (LISTING)
Property Identification
Property Name Residential Land: Well 70 Treatment Parcel Address 7111 McHenry Avenue
City, State Zip Modesto, California 95356
County Stanislaus
Latitude/Longitude 37.747051/-120.997878
Tax ID 004-102-005
Transaction Data
Listing Date May 2020
Sale Status Listing
Grantor Arnold W. Setliff et al.

Grantee Unknown
Recording Number Unknown
Sale Price $20,000,000
Property Description
Gross Acres 82.01
Gross SF 3,572,356
Corner/Interior Interior
Shape Generally Rectangular
Use Designation Agriculture
Zoning Jurisdiction Stanislaus County
Zoning Code A-2-40
Zoning Description Agriculture
Indicators
$/Gross SF $5.60

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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 52 Remarks X
This site consists of a single parcel located along the west side of McHenry Avenue in unincorporated Stanislaus County within the sphere of influence of the City of Modesto. The site has a generally rectangular shape and an interior lot configuration one parcel north of Stewart Road. The site has approximately 2,862 feet of frontage along McHenry Avenue.

The underlying site contains 82.01 acres. The property zoning is Agriculture (A-2-40) and the General Plan land use designation is Agriculture. However, the property was previously approved for a residential subdivision, and we conclude it is reasonably probable that the County would re-approve a residential subdivision on the property which allows residential lots of at least 20,000 square feet in size.

Arnold W. Setliff et al. listed this property for sale in May 2020 and the property has been on the market since. Currently the property is in the negotiation stage with two developers, that if purchased would subdivide the property into single-family lots. The listing agent believes the property will sell for approximately $20,000,000 or $5.60 per square foot.
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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 53 Land Sales Comparison Analysis
When necessary, adjustments were made for differences in various elements of comparison, including property rights conveyed, financing terms, conditions of sale, expenditures made immediately after purchase, market conditions, location, and other physical characteristics. If the element in comparison is considered superior to that of the subject, we applied a negative adjustment. Conversely, a positive adjustment was applied if inferior. A summary of the elements of comparison follows.

Transaction Adjustments
Transaction adjustments include (1) real property rights conveyed, (2) financing terms, (3) conditions of sale, and (4) expenditures made immediately after purchase. These items, which are applied prior to the market conditions and property adjustments, are discussed as follows:

Real Property Rights Conveyed
Real property rights conveyed influence sale prices and must be considered when analyzing a sale comparable. The appraised value and sale comparables all reflect the fee simple interest with no adjustments required.

Financing Terms
The transaction price of one property may differ from that of an identical property due to different financial arrangements. Sales involving financing terms that are not at or near market terms require adjustments for cash equivalency to reflect typical market terms. A cash equivalency procedure discounts the atypical mortgage terms to provide an indication of value at cash equivalent terms.

All of the sale comparables involved typical market terms by which the sellers received cash or its equivalent and the buyers paid cash or tendered typical down payments and obtained conventional financing at market terms for the balance. Therefore, no adjustments for this category are required.

Conditions of Sale
When the conditions of sale are atypical, the result may be a price that is higher or lower than that of a normal transaction. Adjustments for conditions of sale usually reflect the motivations of either a buyer or a seller who is under duress to complete the transaction. Another more typical condition of sale involves the downward adjustment required to a comparable property’s for-sale listing price, which usually reflects the upper limit of value.

Comparable Five is a listing and is downward adjusted. The other sale comparables do not indicate any condition of sale adjustments are warranted for atypical conditions or for-sale listings.

Market Conditions Adjustment
Market conditions change over time because of inflation, deflation, fluctuations in supply and demand, or other factors. Changing market conditions may create a need for adjustment to comparable sale transactions completed during periods of dissimilar market conditions.

Market conditions for land in general had been improving. Land appreciation was significant prior to 2020, when the pandemic hit the market, but mostly for developable land. Demand was reduced starting in 2022 when the Federal Reserve began increasing the Federal Funds Rate in an attempt to curb inflation. Upward adjustment for time was made to the older comparable, Sale Four. The other comparables are fairly recent sales and no time adjustment is warranted. #21..
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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 54 Property Adjustments
Property adjustments are usually expressed quantitatively as percentages or dollar amounts that reflect the differences in value attributable to the various characteristics of the property. In some instances, however, qualitative adjustments are used. These adjustments are based on locational and physical characteristics and are applied after transaction and market conditions adjustments.

Our reasoning for the property adjustments made to each sale comparable follows. The discussion analyzes each adjustment category deemed applicable to the subject.

Location
Location adjustments may be required when the locational characteristics of a comparable are different from those of the subject. These characteristics can include general neighborhood characteristics, freeway accessibility, street exposure, corner- versus interior-lot location, neighboring properties, view amenities, and other factors.

The subject site is located along McHenry Avenue in unincorporated Stanislaus County in an area known as Del Rio which is known for having multi-million dollar homes. Comparables One through Four have inferior locations in areas with lower home values and are upward adjusted. No other adjustments are warranted to the rest of the comparables.

Size
The size adjustment addresses variance in the physical size of the comparables and that of the subject, as a larger parcel typically commands a lower price per unit than a smaller parcel. This inverse relationship is due, in part, to the principle of “economies of scale.” The subject site contains 82.01 acres of land. The comparables range in site size between 18.80 and 106.31 acres. Comparables One, Three, and Four have smaller site sizes and are downward adjusted.

Comparable Two has a larger size and is upward adjusted. No other adjustments are warranted for this element of comparison.

Shape/Depth/Site Utility
Comparable Two has an irregular shaped site which reduces the site’s utility and warrants upward adjustment. No other adjustments are warranted for this category.

Floodplain
The subject is not located within a flood hazard zone. None of the comparables are located within a flood hazard zone and no adjustments are made for this category.

Zoning/Density
The highest and best use of sale comparables should be very similar to that of the subjects. When comparables with the same zoning as the subjects are lacking or scarce, parcels with slightly different zoning, but a highest and best use similar to that of the subjects may be used as comparables. These comparables may require an adjustment for differences in utility if the market supports such adjustment.

We have assumed a minimum lot size of 20,000 square feet is reasonably probable for the subject based on the zoning in the immediate area and our discussion with county planning. We have used 92 lots for the basis of analysis which considers the semi-rural location, and open space and roads that #21..
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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 55 would be required onsite as part of the subdivision. All comparables except for Comparable Five allow single-family residential use but with higher density (smaller lot sizes) which warrants downward adjustment.

Approvals
We have appraised the subject as unentitled land with no approvals in place. Comparables One through Four sold with Tentative Map approval and are downward adjusted. The size of adjustment considers that the subject had previous entitlement work done and the risk of getting approvals is reduced since the county’s Measure E (General Election Ballot) would not be triggered. No additional adjustment is made to the rest of the comparables.

As previously cited, we have considered in the valuation the risks associated with the time duration for how long it will take the City of Modesto to complete the well expansion. The City engineer, Mr. Vargas, opined the project will be complete within two years. The buyer of the subject still needs to obtain entitlements and we opine the risk of the City not moving forward with the well expansion is very low.

We have considered the risks associated with the well expansion and future subdivision approvals in the reconciliation.

Other
This adjustment category reflects items not yet adjusted for. No other adjustments are considered necessary.

Summary of Adjustments
Presented on the following page is a summary of the adjustments made to the sale comparables. As noted earlier, these adjustments were based on our market research, best judgment, and experience in the appraisal of similar properties.
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Land Sales Adjustment Grid 1 2 3 45
Subject Sale # 1 Sale # 2 Sale # 3 Sale # 4 Sale # 5
Date of Value & Sale January-24 January-22 May-22 January-22 December-20 Listing Unadjusted Sales Price $16,610,000 $22,800,000 $5,100,000 $4,875,000 $20,000,000 Gross Acres 82.010 56.460 106.310 18.800 19.700 82.010
Unadjusted Sales Price per Gross Sq. Ft. $6.75 $4.92 $6.23 $5.68 $5.60 Transactional Adjustments
Property Rights Conveyed Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple Adjusted Sales Price $6.75 $4.92 $6.23 $5.68 $5.60
Financing Terms Cash Conventional Cash Conventional Unknown Adjusted Sales Price $6.75 $4.92 $6.23 $5.68 $5.60
Conditions of Sale Typical Typical Typical Typical Typical Listing Adjustment - - - - -10.0%
Adjusted Sales Price $6.75 $4.92 $6.23 $5.68 $5.04
Market Conditions Adjustments
Elapsed Time from Date of Value 1.93 years 1.60 years 1.93 years 3.00 years 0.00 years Market Trend Through January-24 - - - 5.8% -
Analyzed Sales Price $6.75 $4.92 $6.23 $6.01 $5.04 0.0% 0.0% 0.0% 0.0% 0.0% Physical Adjustments
Location 7111 McHenry
Avenue
Santa Fe Avenue &
East Hatch Road
697 North Airport
Way
Santa Fe Street &
Snedigar Road
3007 East
Tuolumne Road
7111 McHenry
Avenue
Modesto Hughson Manteca Riverbank Turlock Modesto
Adjustment 10.0% 10.0% 10.0% 10.0% - 0.0% 0.0% 0.0% 0.0% 0.0% Size 82.010 acres 56.460 acres 106.310 acres 18.800 acres 19.700 acres 82.010 acres Adjustment -5.0% 5.0% -10.0% -10.0% - 0.0% 0.0% 0.0% 0.0% 0.0% Shape/Depth Generally
Rectangular
Irregular Irregular Irregular Rectangular Irregular
Adjustment - 5.0% - - - 0.0% 0.0% 0.0% 0.0% 0.0%
Floodplain X X X X XX
Adjustment - - - - - 0.0% 0.0% 0.0% 0.0% 0.0%
Zoning/Density PD; 1.2 du/ac C-2, R-1, R-2; 5.30
du/ac
R-1 & P; 4.17
du/ac
R-1; 4.41 du/ac RL; 3.05 du/ac A-2-40/ PD; 1.2
du/ac
Adjustment -10.0% -5.0% -5.0% -5.0% - 0.0% 0.0% 0.0% 0.0% 0.0% Approvals None Approved/
Contingent
Approved/
Contingent
Approved/
Contingent
Approved/
Contingent
None
Adjustment -10.0% -10.0% -10.0% -10.0% - 0.0% 0.0% 0.0% 0.0% 0.0% Other Typical - - - - -
Adjustment - - - - -
Net Physical Adjustment -15.0% 5.0% -15.0% -15.0% -
Adjusted Sales Price per Gross Square Foot $5.74 $5.17 $5.29 $5.11 $5.04 #21..
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LAND VALUATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 57 Sales Comparison Approach Value Indication
From the market data available, we used five land sales in competitive market areas which were adjusted based on pertinent elements of comparison. The following table summarizes the unadjusted and adjusted unit prices:

After adjustments, the comparables indicate unit values ranging from $5.04 to $5.74 per square foot of land with an average of $5.27 and median of $5.17. Most weight is given to Comparables One through Three and Five due to their overall physical and locational similarity with the subject. These comparables have adjusted unit values of $5.74, $5.17, $5.29, and $5.04.

Based on the best comparables for the subject, we have estimated a unit value of $5.25 per square foot for the Entire Property. Applying this unit value to the land area of the Well 70 Treatment Parcel indicates a contributory market value of $75,000 for the Well 70 Treatment Parcel.

Based on this analysis, the land value indication is summarized as follows:

Land Sale Statistics
Metric Unadjusted Analyzed Adjusted
Min. Sales Price per Gross Square Foot $4.92 $4.92 $5.04 Max. Sales Price per Gross Square Foot $6.75 $6.75 $5.74 Median Sales Price per Gross Square Foot $5.68 $6.01 $5.17 Mean Sales Price per Gross Square Foot $5.84 $5.79 $5.27 Sales Comparison Approach Conclusion (Land Value)
14,426 x $5.25 = $75,737
SF Per SF
Rounded $75,000
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RECONCILIATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 58 Reconciliation
Summary of Value Indications
The indicated values from the approaches used and our concluded market values for the subject property are summarized in the following table.

To reach a final opinion of value, the reliability and relevance of each value indication was considered based upon the quality of the data and applicability of the assumptions underlying each approach.

Given the availability and reliability of data within the sales comparison approach, this approach was given primary weight in reconciling to the final value conclusion. Furthermore, land properties such as the subject are typically purchased by developers, who primarily rely upon the methods employed by the sales comparison approach.

The findings and conclusions are further contingent upon the following extraordinary assumptions and/or hypothetical conditions, the use of which might have affected the assignment results:

Extraordinary Assumptions:
 We have assumed the buyer will bear all costs associated with engineering and County fees at no detriment to the seller regarding the lot line adjustment.

Hypothetical Conditions:
 None
Exposure Time and Marketing Period
Based on statistical information about days on market, escrow length, and marketing times gathered through national investor surveys, sales verification, and interviews of market participants, marketing and exposure time estimates of 6 to 12 months are considered reasonable and appropriate for the subject.

Approach to Value Well 70 Treatment Parcel
Sales Comparison Approach $75,000
Component Well 70 Treatment Parcel
Value Type Market Value
Property Rights Appraised Fee Simple
Date of Value January 1, 2024
Market Value $75,000
Value Indication
Value Conclusion
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GENERAL ASSUMPTIONS & LIMITING CONDITIONS
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 59 General Assumptions and Limiting Conditions
This appraisal is subject to the following general assumptions and limiting conditions:

1. The legal description – if furnished to us – is assumed to be correct.

2. No responsibility is assumed for legal matters, questions of survey or title, soil or subsoil conditions, engineering, availability or capacity of utilities, or other similar technical matters. The appraisal does not constitute a survey of the property appraised. All existing liens and encumbrances have been disregarded and the property is appraised as though free and clear, under responsible ownership and competent management unless otherwise noted.

3. Unless otherwise noted, the appraisal will value the property as though free of contamination.

Valbridge Property Advisors | Northern California will conduct no hazardous materials or contamination inspection of any kind. It is recommended that the client hire an expert if the presence of hazardous materials or contamination poses any concern.

4. The stamps and/or consideration placed on deeds used to indicate sales are in correct relationship to the actual dollar amount of the transaction.

5. Unless otherwise noted, it is assumed there are no encroachments, zoning violations or restrictions existing in the subject property.

6. The appraiser is not required to give testimony or attendance in court by reason of this appraisal, unless previous arrangements have been made.

7. Unless expressly specified in the engagement letter, the fee for this appraisal does not include the attendance or giving of testimony by Appraiser at any court, regulatory or other proceedings, or any conferences or other work in preparation for such proceeding. If any partner or employee of Valbridge Property Advisors | Northern California is asked or required to appear and/or testify at any deposition, trial, or other proceeding about the preparation, conclusions or any other aspect of this assignment, client shall compensate Appraiser for the time spent by the partner or employee in appearing and/or testifying and in preparing to testify according to the Appraiser’s then current hourly rate plus reimbursement of expenses.

8. The values for land and/or improvements, as contained in this report, are constituent parts of the total value reported and neither is (or are) to be used in making a summation appraisal of a combination of values created by another appraiser. Either is invalidated if so used.

9. The dates of value to which the opinions expressed in this report apply are set forth in this report.

We assume no responsibility for economic or physical factors occurring at some point at a later date, which may affect the opinions stated herein. The forecasts, projections, or operating estimates contained herein are based on current market conditions and anticipated short-term supply and demand factors and are subject to change with future conditions. Appraiser is not responsible for determining whether the date of value requested by Client is appropriate for Client’s intended use.

10. The sketches, maps, plats and exhibits in this report are included to assist the reader in visualizing the property. The appraiser has made no survey of the property and assumed no responsibility in connection with such matters.

11. The information, estimates and opinions, which were obtained from sources outside of this office, are considered reliable. However, no liability for them can be assumed by the appraiser. #21..
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12. Possession of this report, or a copy thereof, does not carry with it the right of publication. Neither all, nor any part of the content of the report, or copy thereof (including conclusions as to property value, the identity of the appraisers, professional designations, reference to any professional appraisal organization or the firm with which the appraisers are connected), shall be disseminated to the public through advertising, public relations, news, sales, or other media without prior written consent and approval.

13. No claim is intended to be expressed for matters of expertise that would require specialized investigation or knowledge beyond that ordinarily employed by real estate appraisers. We claim no expertise in areas such as, but not limited to, legal, survey, structural, environmental, pest control, mechanical, etc.

14. This appraisal was prepared for the sole and exclusive use of the client for the function outlined herein. Any party who is not the client or intended user identified in the appraisal or engagement letter is not entitled to rely upon the contents of the appraisal without express written consent of Valbridge Property Advisors | Northern California and Client. The Client shall not include partners, affiliates, or relatives of the party addressed herein. The appraiser assumes no obligation, liability or accountability to any third party.

15. Distribution of this report is at the sole discretion of the client, but third-parties not listed as an intended user on the face of the appraisal or the engagement letter may not rely upon the contents of the appraisal. In no event shall client give a third-party a partial copy of the appraisal report. We will make no distribution of the report without the specific direction of the client.

16. This appraisal shall be used only for the function outlined herein, unless expressly authorized by Valbridge Property Advisors | Northern California.

17. This appraisal shall be considered in its entirety. No part thereof shall be used separately or out of context.

18. It is assumed that there are no hidden or unapparent conditions of the property, subsoil, or structures which would render it more or less valuable. No responsibility is assumed for such conditions or for engineering which may be required to discover them.

19. In the absence of being provided with a detailed land survey, we have used assessment department data to ascertain the physical dimensions and acreage of the property. Should a survey prove this information to be inaccurate, upon request of the client, the appraiser will submit a revised report for an additional fee.

20. Unless otherwise stated in this report, the value conclusion is predicated on the assumption that the property is free of contamination, environmental impairment or hazardous materials. Unless otherwise stated, the existence of hazardous material was not observed by the appraiser and the appraiser has no knowledge of the existence of such materials on or in the property. The appraiser, however, is not qualified to detect such substances. The presence of substances such as asbestos, urea-formaldehyde foam insulation or other potentially hazardous materials may affect the value of the property. No responsibility is assumed for any such conditions, or for any expertise or engineering knowledge required for discovery. The client is urged to retain an expert in this field, if desired.

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22. The data gathered in the course of this assignment (except data furnished by the Client) shall remain the property of the Appraiser. The appraiser will not violate the confidential nature of the appraiserclient relationship by improperly disclosing any confidential information furnished to the appraiser.

Notwithstanding the foregoing, the Appraiser is authorized by the client to disclose all or any portion of the appraisal and related appraisal data to appropriate representatives of the Appraisal Institute if such disclosure is required to enable the appraiser to comply with the Bylaws and Regulations of such Institute now or hereafter in effect.

23. You and Valbridge Property Advisors | Northern California both agree that any dispute over matters in excess of $5,000 will be submitted for resolution by arbitration. This includes fee disputes and any claim of malpractice. The arbitrator shall be mutually selected. If Valbridge Property Advisors | Northern California and the client cannot agree on the arbitrator, the presiding head of the Local County Mediation & Arbitration panel shall select the arbitrator. Such arbitration shall be binding and final. In agreeing to arbitration, we both acknowledge that, by agreeing to binding arbitration, each of us is giving up the right to have the dispute decided in a court of law before a judge or jury.

In the event that the client, or any other party, makes a claim against Valbridge Property Advisors | Northern California or any of its employees in connections with or in any way relating to this assignment, the maximum damages recoverable by such claimant shall be the amount actually received by Valbridge Property Advisors | Northern California for this assignment, and under no circumstances shall any claim for consequential damages be made.

24. Valbridge Property Advisors | Northern California shall have no obligation, liability, or accountability to any third party. Any party who is not the “client” or intended user identified on the face of the appraisal or in the engagement letter is not entitled to rely upon the contents of the appraisal without the express written consent of Valbridge Property Advisors | Northern California. “Client” shall not include partners, affiliates, or relatives of the party named in the engagement letter. Client shall hold Valbridge Property Advisors | Northern California and its employees harmless in the event of any lawsuit brought by any third party, lender, partner, or part-owner in any form of ownership or any other party as a result of this assignment. The client also agrees that in case of lawsuit arising from or in any way involving these appraisal services, client will hold Valbridge Property Advisors | Northern California harmless from and against any liability, loss, cost, or expense incurred or suffered by Valbridge Property Advisors | Northern California in such action, regardless of its outcome.

25. The Valbridge Property Advisors office responsible for the preparation of this report is independently owned and operated by San Francisco Bay Area | Silicon Valley | San Jose. Neither Valbridge Property Advisors, Inc., nor any of its affiliates has been engaged to provide this report.

Valbridge Property Advisors, Inc. does not provide valuation services, and has taken no part in the preparation of this report.

26. If any claim is filed against any of Valbridge Property Advisors, Inc., a Florida Corporation, its affiliates, officers or employees, or the firm providing this report, in connection with, or in any way arising out of, or relating to, this report, or the engagement of the firm providing this report, then (1) under no circumstances shall such claimant be entitled to consequential, special or other damages, except only for direct compensatory damages, and (2) the maximum amount of such compensatory damages recoverable by such claimant shall be the amount actually received by the firm engaged to provide this report.

27. This report and any associated work files may be subject to evaluation by Valbridge Property Advisors, Inc., or its affiliates, for quality control purposes.

28. Acceptance and/or use of this appraisal report constitutes acceptance of the foregoing general assumptions and limiting conditions.
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29. The global outbreak of a "novel coronavirus" (known as COVID-19) was officially declared a pandemic by the World Health Organization (WHO). It is currently unknown what direct, or indirect, effect, if any, this event may have on the national economy, the local economy or the market in which the subject property is located. The reader is cautioned and reminded that the conclusions presented in this appraisal report apply only as of the effective date(s) indicated. The appraiser makes no representation as to the effect on the subject property of this event, or any event, subsequent to the effective date of the appraisal.
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CERTIFICATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 63 Certification – Tony Sciarrilli
I certify that, to the best of my knowledge and belief:

1. The statements of fact contained in this report are true and correct.

2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions and are my personal, impartial, and unbiased professional analyses, opinions, and conclusions.

3. I have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved.

4. The undersigned has not performed services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding acceptance of this assignment.

5. I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.

6. My engagement in this assignment was not contingent upon developing or reporting predetermined results.

7. My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal.

8. My analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice.

9. Tony Sciarrilli has not personally inspected the subject property.

10. Ashley Jordan provided significant real property appraisal assistance to the person signing this certification. Specific details as to the assistance provided is included in the Scope of Work section of this report.

11. The reported analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute.

12. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.

13. As of the date of this report, the undersigned has completed the Standards and Ethics Education Requirement for Candidates/Practicing Affiliates of the Appraisal Institute.

Tony M. Sciarrilli
Appraiser
California Certified License #AG3003462

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CERTIFICATION
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 64 Certification – Walter D. Carney, MAI
I certify that, to the best of my knowledge and belief:

1. The statements of fact contained in this report are true and correct.

3. I have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved.

5. I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.

6. My engagement in this assignment was not contingent upon developing or reporting predetermined results.

8. My analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice.

9. Walt Carney, MAI has not personally inspected the subject property.

12. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.

13. As of the date of this report, the undersigned has completed the continuing education program for Designated Members of the Appraisal Institute.

Walter D. Carney, MAI
Senior Managing Director
California Certified License #AG003413

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ADDENDA
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 65 Addenda
Preliminary Title Report
Well 70 Treatment Parcel Legal Description
Glossary
Qualifications
 Tony Sciarrilli - Appraiser
 Walter D. Carney, MAI - Senior Managing Director
Information on Valbridge Property Advisors
Office Locations
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© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 91 Glossary
Definitions are taken from The Dictionary of Real Estate Appraisal, 7th Edition (Dictionary), the Uniform Standards of Professional Appraisal Practice (USPAP), and Building Owners and Managers Association International (BOMA).

Absolute Net Lease
A lease in which the tenant pays all expenses including structural maintenance, building reserves, and
management; often a long-term lease to a credit tenant. (Dictionary)
Amortization
The process of retiring a debt or recovering a capital
investment, typically through scheduled, systematic
repayment of the principal; a program of periodic
contributions to a sinking fund or debt retirement fund. (Dictionary)
As Is Market Value
The estimate of the market value of real property in its current physical condition, use, and zoning as of the
appraisal date. (Interagency Appraisal and Evaluation
Guidelines) Note that the use of the “as is” phrase is
specific to appraisal regulations pursuant to FIRREA
applying to appraisals prepared for regulated lenders in the United States. The concept of an “as is” value is not included in the Standards of Valuation Practice of the
Appraisal Institute, Uniform Standards of Professional
Appraisal Practice, or International Valuation Standards. (Dictionary)
Base Rent
The minimum rent stipulated in a lease. (Dictionary)
Base Year
The year on which escalation clauses in a lease are based. (Dictionary)
Building Common Area
In office buildings, the areas of the building that provide services to building tenants but that are not included in the office area or store area of any specific tenant. These areas may include, but shall not be limited to, main and auxiliary lobbies, atrium spaces at the level of the finished floor, concierge areas or security desks, conference
rooms, lounges or vending areas, food service facilities, health or fitness centers, daycare facilities, locker or shower facilities, mail rooms, fire control rooms, fully enclosed courtyards outside the exterior walls, and
building core and service areas such as fully enclosed
mechanical or equipment rooms. Specifically excluded
from building common area are floor common areas,
parking space, portions of loading docks outside the
building line, and major vertical penetrations. (BOMA)
Building Rentable Area
The sum of all floor rentable areas. Floor rentable area is the result of subtracting from the gross measured area of a floor the major vertical penetrations on that same floor.

It is generally fixed for the life of the building and is rarely affected by changes in corridor size or configuration.
(BOMA)
Bulk Value
The value of multiple units, subdivided plots, or
properties in a portfolio as though sold together in a
single transaction. (Dictionary)
Certificate of Occupancy (COO)
A formal written acknowledgment by an appropriate unit
of local government that a new construction or
renovation project is at the stage where it meets
applicable health and safety codes and is ready for
commercial or residential occupancy. (Dictionary)
Common Area Maintenance (CAM)
The expense of operating and maintaining common
areas; may or may not include management charges and
usually does not include capital expenditures on tenant improvements or other improvements to the property.
(Dictionary)
The amount of money charged to tenants for their shares of maintaining a [shopping] center’s common area. The
charge that a tenant pays for shared services and facilities such as electricity, security, and maintenance of parking lots. Items charged to common area maintenance may
include cleaning services, parking lot sweeping and
maintenance, snow removal, security, [amenities,] and
upkeep. (ICSC – International Council of Shopping
Centers, 4th Ed.)
Condominium
An attached, detached, or stacked unit within or attached to a structure with common areas that are held as tenants in common (an undivided interest) with other owners in
the project. The units can be residential, commercial,
industrial, or parking spaces or boat docks. These units are commonly defined by state laws in their locations.

Because units can be stacked on top of other units, these units can be defined both vertically and horizontally.
(Dictionary)
Conservation Easement
An interest in real estate restricting future land use to preservation, conservation, wildlife habitat, or some
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© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 92 combination of those uses. A conservation easement may
permit farming, timber harvesting, or other uses of a rural nature as well as some types of conservation-oriented
development to continue, subject to the easement.
(Dictionary)
Contributory Value
A type of value that reflects the amount a property or
component of a property contributes to the value of
another asset or to the property as a whole.

The change in the value of a property as a whole, whether positive or negative, resulting from the addition or
deletion of a property component. Also called deprival
value in some countries. (Dictionary)
Debt Coverage Ratio (DCR)
The ratio of net operating income to annual debt service (DCR = NOI÷Im), which measures the relative ability of a property to meet its debt service out of net operating
income; also called debt service coverage ratio (DSCR). A larger DCR typically indicates a greater ability for a
property to withstand a reduction of income, providing
an improved safety margin for a lender. (Dictionary)
Deed Restriction
A provision written into a deed that limits the use of land.

Deed restrictions usually remain in effect when title
passes to subsequent owners. (Dictionary)
Depreciation
In appraisal, a loss in property value from any cause; the difference between the cost of an improvement on the
effective date of the appraisal and the value of the
improvement on the same date.

In accounting, an allocation of the original cost of an asset, amortizing the cost over the asset’s life; calculated using a variety of standard techniques. (Dictionary)
Disposition Value
The most probable price that a specified interest in
property should bring under the following conditions:

1. Consummation of a sale within a specified time,
which is shorter than the typical exposure time for
such a property in that market.

2. The property is subjected to market conditions
prevailing as of the date of valuation;

3. Both the buyer and seller are acting prudently and
knowledgeably;

4. The seller is under compulsion to sell;

5. The buyer is typically motivated;

6. Both parties are acting in what they consider to be
their best interests;

7. An adequate marketing effort will be made during
the exposure time;

8. Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements
comparable thereto; and

9. The price represents the normal consideration for
the property sold, unaffected by special or creative
financing or sales concessions granted by anyone
associated with the sale.

This definition can also be modified to provide for
valuation with specified financing terms. (Dictionary)
Double Net (Net Net) Lease
An alternative term for a type of net lease. In some
markets, a net net lease is defined as a lease in which the tenant is responsible to pay both property taxes and
premiums for insuring the building(s). (Valbridge)
(The market definition of a double net lease varies
depending on the market)
Easement
The right to use another’s land for a stated purpose.
(Dictionary)
EIFS
Exterior Insulation Finishing System. This is a type of exterior wall cladding system. Sometimes referred to as dry-vit.

Effective Date

1. The date on which the appraisal opinion applies.
(SVP)

2. The date to which an appraiser’s analyses, opinions, and conclusions apply; also referred to as date of
value. (USPAP, 2020-2021 ed.)

3. The date that a lease goes into effect. (Dictionary) Effective Gross Income (EGI)
The anticipated income from all operations of the real
estate after an allowance is made for vacancy and
collection losses and an addition is made for any other income. (Dictionary)
Effective Rent
Total base rent, or minimum rent stipulated in a lease, over the specified lease term minus rent concessions; the rent that is effectively paid by a tenant net of financial concessions provided by a landlord. (TIs). (Dictionary) EPDM
Ethylene Propylene Diene Monomer Rubber. A type of
synthetic rubber typically used for roof coverings.

Escalation Clause
A clause in an agreement that provides for the
adjustment of a price or rent based on some event or
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© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 93 index. e.g., a provision to increase rent if operating
expenses increase; also called escalator clause, expense recovery clause or stop clause. (Dictionary)
Estoppel Certificate
A signed statement by a party (such as a tenant or a
mortgagee) certifying, for another’s benefit, that certain facts are correct, such as that a lease exists, that there are no defaults, and that rent is paid to a certain date.
(Black’s) In real estate, a buyer of rental property typically requests estoppel certificates from existing tenants.

Sometimes referred to as an estoppel letter. (Dictionary) Excess Land
Land that is not needed to serve or support the existing use. The highest and best use of the excess land may or may not be the same as the highest and best use of the
improved parcel. Excess land has the potential to be sold separately and is valued separately. (Dictionary)
Excess Rent
The amount by which contract rent exceeds market rent
at the time of the appraisal; created by a lease favorable to the landlord (lessor) and may reflect unusual
management, unknowledgeable or unusually motivated
parties, a lease execution in an earlier, stronger rental market, or an agreement of the parties. (Dictionary)
Expense Stop
A clause in a lease that limits the landlord’s expense
obligation, which results in the lessee paying operating expenses above a stated level or amount. (Dictionary)
Exposure Time

1. The time a property remains on the market.

2. An opinion, based on supporting market data, of the
length of time that the property interest being
appraised would have been offered on the market
prior to the hypothetical consummation of a sale at
market value on the effective date of the appraisal.
(USPAP, 2020-2021 ed.)
Extraordinary Assumption
An assignment-specific assumption as of the effective
date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.

Comment: Uncertain information might include physical,
legal, or economic characteristics of the subject property; or conditions external to the property, such as market
conditions or trends; or the integrity of data used in an analysis. (USPAP)
Fee Simple Estate
Absolute ownership unencumbered by any other interest
or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain,
police power, and escheat. (Dictionary)
Floor Common Area
In an office building, the areas on a floor such as
washrooms, janitorial closets, electrical rooms, telephone rooms, mechanical rooms, elevator lobbies, and public
corridors which are available primarily for the use of
tenants on that floor. In essence, floor common area
represents all of the area on the floor that is common to that respective floor with the exception of those areas that penetrate through the floor, such as the elevator
shaft and stairwell. The significant point to be made is that floor common area is not part of the tenant’s usable area. (BOMA)
Full Service (Gross) Lease
A lease in which the landlord receives stipulated rent and is obligated to pay all of the property’s operating and fixed expenses; also called a full service lease. (Dictionary) Furniture, Fixtures, and Equipment (FF&E)
Business trade fixtures and personal property, exclusive of inventory. (Dictionary)
Going-Concern Value
An outdated label for the market value of all the tangible and intangible assets of an established and operating
business with an indefinite life, as if sold in aggregate; more accurately termed the market value of the going
concern or market value of the total assets of the business. (Dictionary)
Gross Building Area (GBA)

1. Total floor area of a building, excluding unenclosed areas, measured from the exterior of the walls of the
above-grade area. This includes mezzanines and
basements if and when typically included in the
market area of the type of property involved.

2. Gross leasable area plus all common areas.

3. For residential space, the total area of all floor levels measured from the exterior of the walls and
including the superstructure and substructure
basement; typically does not include garage space.
(Dictionary)
Gross Measured Area
The total area of a building enclosed by the dominant
portion (the portion of the inside finished surface of the permanent outer building wall which is 50 percent or
more of the vertical floor-to-ceiling dimension, at the given point being measured as one moves horizontally
along the wall), excluding parking areas and loading
docks (or portions of same) outside the building line. It is generally not used for leasing purposes and is calculated on a floor by floor basis. (BOMA)
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A method of calculating variable operating expenses in
income-producing properties when less than 100%
occupancy is assumed. Expenses reimbursed based on
the amount of occupied space, rather than on the total
building area, are described as “grossed up.” (Dictionary) Gross Sellout Value (Sum of the Retail Values)
The sum of the separate and distinct market value
opinions for each of the units in a condominium,
subdivision development, or portfolio of properties, as of the date of valuation. The aggregate of retail values does not represent the value of all the units as though sold together in a single transaction; it is simply the total of the individual market value conclusions. An appraisal has an effective date, but summing the sale prices of multiple units over an extended period of time will not be the
value on that one day unless the prices are discounted to make the value equivalent to what another developer or
investor would pay for the bulk purchase of the units. Also called the aggregate of the retail values, aggregate retail selling price or sum of the retail values. (Dictionary) Ground Lease
A lease that grants the right to use and occupy land.

Improvements made by the ground lessee typically revert to the ground lessor at the end of the lease term.
(Dictionary)
Ground Rent
The rent paid for the right to use and occupy land
according to the terms of a ground lease; the portion of the total rent allocated to the underlying land.
(Dictionary)
HVAC
Heating, ventilation, air conditioning (HVAC) system. A unit that regulates the temperature and distribution of heat and fresh air throughout a building. (Dictionary)
Highest and Best Use

1. The reasonably probable use of property that results in the highest value. The four criteria that the highest and best use must meet are legal permissibility,
physical possibility, financial feasibility, and
maximum productivity.

2. The use of an asset that maximizes its potential and that is possible, legally permissible, and financially
feasible. The highest and best use may be for
continuation of an asset’s existing use of for some
alternative use. This is determined by the use that a
market participant would have in mind for the asset
when formulating the price that it would be willing
to bid. (IVS)

3. [The] highest and most profitable use for which the
property is adaptable and needed or likely to be
needed in the reasonably near future. (Uniform
Appraisal Standards for Federal Land Acquisitions)
(Dictionary)
Hypothetical Condition

1. A condition that is presumed to be true when it is
known to be false. (SVP)

2. A condition, directly related to a specific assignment, which is contrary to what is known by the appraiser
to exist on the effective date of the assignment
results, but is used for the purpose of analysis.

Comment: Hypothetical conditions are contrary to
known facts about physical, legal, or economic
characteristics of the subject property; or about
conditions external to the property, such as market
conditions or trends; or about the integrity of data used in an analysis. (USPAP)
Insurable Value (Replacement Cost for Insurance
Purposes)
The estimated cost, at current prices as of the effective date of valuation, of a substitute for the building being valued, using modern materials and current standards,
design, and layout for insurance coverage purposes
guaranteeing that damaged property is replaced with
new property (i.e., depreciation is not deducted).
(Dictionary)
Investment Value

1. The value of a property to a particular investor or
class of investors based on the investor’s specific
requirements. Investment value may be different
from market value because it depends on a set of
investment criteria that are not necessarily typical of the market. (Dictionary)

2. The value of an asset to the owner or a prospective
owner given individual investment or operational
objectives (may also be known as worth). (IVS)
Just Compensation
In condemnation, the amount of loss for which a property owner is compensated when his or her property is taken.

Just compensation should put the owner in as good a
position pecuniarily as he or she would have been if the property had not been taken. (Dictionary)
Leased Fee Interest
The ownership interest held by the lessor, which includes the right to receive the contract rent specified in the lease plus the reversionary right when the lease expires.
(Dictionary)
Leasehold Interest (Leasehold Estate)
The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease. (Dictionary)
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© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 95 See also Positive Leasehold and Negative Leasehold.

Lessee (Tenant)
One who has the right to occupancy and use of the
property of another for a period of time according to a lease agreement. (Dictionary)
Lessor (Landlord)
One who conveys the rights of occupancy and use to
others under a lease agreement. (Dictionary)
Liquidation Value
The most probable price that a specified interest in
property should bring under the following conditions:

1. Consummation of a sale within a short time period.

2. The property is subjected to market conditions
prevailing as of the date of valuation.

3. Both the buyer and seller are acting prudently and
knowledgeably.

4. The seller is under extreme compulsion to sell.

5. The buyer is typically motivated.

6. Both parties are acting in what they consider to be
their best interests.

7. A normal marketing effort is not possible due to the brief exposure time.

8. Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements
comparable thereto.

9. The price represents the normal consideration for
the property sold, unaffected by special or creative
financing or sales concessions granted by anyone
associated with the sale. (Dictionary)
Loan to Value Ratio (LTV)
The ratio between a mortgage loan and the value of the
property pledged as security, usually expressed as a
percentage. (Dictionary)
Major Vertical Penetrations
Stairs, elevator shafts, flues, pipe shafts, vertical ducts, and the like, and their enclosing walls. Atria, lightwells and similar penetrations above the finished floor are included in this definition. Not included, however, are vertical penetrations built for the private use of a tenant
occupying office areas on more than one floor. Structural columns, openings for vertical electric cable or telephone distribution, and openings for plumbing lines are not
considered to be major vertical penetrations. (BOMA)
Market Rent
The most probable rent that a property should bring in a competitive and open market under all the conditions
requisite to a fair lease transaction, the lessee and the lessor each acting prudently and knowledgeably, and
assuming the rent is not affected by undue stimulus.

Implicit in this definition is the execution of a lease as of a specified date under conditions whereby:

1. Lessee and lessor are typically motivated;

2. Both parties are well informed or well advised, and
acting in what they consider their best interests;

3. Payment is made in terms of cash or in terms of
financial arrangements comparable thereto; and

4. The rent reflects specified terms and conditions, such as permitted uses, use restrictions, expense
obligations, duration, concessions, rental
adjustments and revaluations, renewal and purchase
options, and tenant improvements (TIs). (Appraisal
Institute)
Market Value
The following definition of market value is used by
agencies that regulate federally insured financial
institutions in the United States: The most probable price that a property should bring in a competitive and open
market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and
knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the
consummation of a sale as of a specified date and the
passing of title from seller to buyer under conditions
whereby:

1. Buyer and seller are typically motivated;

2. Both parties are well informed or well advised, and
acting in what they consider their own best interests;

3. A reasonable time is allowed for exposure in the
open market;

4. Payment is made in terms of cash in United States
dollars or in terms of financial arrangements
comparable thereto; and

5. The price represents the normal consideration for
the property sold unaffected by special or creative
financing or sales concessions granted by anyone
associated with the sale. (Dictionary; 12 C.F.R. Part

34.42(g); 55 Federal Register 34696, August 24, 1990,
as amended at 57 Federal Register 12202, April 9,
1992; 59 Federal Register 29499, June 7, 1994)
Marketing Time
An opinion of the amount of time it might take to sell a real or personal property interest at the concluded
market value level during the period immediately after
the effective date of an appraisal. Marketing time differs from exposure time, which is always presumed to precede the effective date of an appraisal. (Advisory Opinion 7 of the Appraisal Standards Board of the Appraisal
Foundation)
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RESIDENTIAL LAND: WELL 70 TREATMENT PARCEL

1. A lease in which a part or the entire property is leased to a single entity (the master lessee) in return for a
stipulated rent. The master lessee then subleases the
property to multiple tenants.

2. The first lease in a sandwich lease. (Dictionary)
Modified Gross Lease
A lease in which the landlord receives stipulated rent and is obligated to pay some, but not all, of the property’s operating and fixed expenses. Since assignment of
expenses varies among modified gross leases, expense
responsibility must always be specified. In some markets, a modified gross lease may be called a double net lease, net net lease, partial net lease, or semi-gross lease.
(Dictionary)
Negative Leasehold
A lease situation in which the market rent is less than the contract rent. (Dictionary)
Operating Expense Ratio
The ratio of total operating expenses to effective gross income (TOE/EGI); the complement of the net income
ratio, i.e., OER = 1 – NIR (Dictionary)
Option
A legal contract, typically purchased for a stated
consideration, that permits but does not require the
holder of the option (known as the optionee) to buy, sell, or lease real estate for a stipulated period of time in accordance with specified terms; a unilateral right to
exercise a privilege. (Dictionary)
Partial Interest
Divided or undivided rights in real estate that represent less than the whole, i.e., a fractional interest such as a tenancy in common or easement. (Dictionary)
Pass Through
A tenant’s portion of operating expenses that may be
composed of common area maintenance (CAM), real
property taxes, property insurance, and any other
expenses determined in the lease agreement to be paid
by the tenant. (Dictionary)
Percentage Lease
A lease in which the rent or some portion of the rent
represents a specified percentage of the volume of
business, productivity, or use achieved by the tenant.
(Dictionary)
Positive Leasehold
A lease situation in which the market rent is greater than the contract rent. (Dictionary)
Potential Gross Income (PGI)
The total income attributable to property at full
occupancy before vacancy and operating expenses are
deducted. (Dictionary)
Prospective Opinion of Value
A value opinion effective as of a specified future date. The term does not define a type of value. Instead, it identifies a value opinion as being effective at some specific future date. An opinion of value as of a prospective date is
frequently sought in connection with projects that are
proposed, under construction, or under conversion to a
new use, or those that have not yet achieved sellout or a stabilized level of long-term occupancy. (Dictionary)
Replacement Cost
The estimated cost to construct, at current prices as of a specific date, a substitute for a building or other
improvements, using modern materials and current
standards, design, and layout. (Dictionary)
Reproduction Cost
The estimated cost to construct, at current prices as of the effective date of the appraisal, an exact duplicate or
replica of the building being appraised, using the same materials, construction standards, design, layout, and
quality of workmanship and embodying all of the
deficiencies, superadequacies, and obsolescence of the
subject building. (Dictionary)
Retrospective Value Opinion
A value opinion effective as of a specified historical date.

The term retrospective does not define a type of value.

Instead, it identifies a value opinion as being effective at some specific prior date. Value as of a historical date is frequently sought in connection with property tax
appeals, damage models, lease renegotiation, deficiency judgments, estate tax, and condemnation. Inclusion of
the type of value with this term is appropriate, e.g.,
“retrospective market value opinion.” (Dictionary)
Sandwich Leasehold Estate
The interest held by the sandwich leaseholder when the
property is subleased to another party; a type of
leasehold estate. (Dictionary)
Sublease
An agreement in which the lessee in a prior lease conveys the right of use and occupancy of a property to another, the sublessee, for a specific period of time, which may or may not be coterminous with the underlying lease term.
(Dictionary)
Subordination
A contractual arrangement in which a party with a claim to certain assets agrees to make that claim junior, or
subordinate, to the claims of another party. (Dictionary) #21..
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RESIDENTIAL LAND: WELL 70 TREATMENT PARCEL

ADDENDA
© 2024 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 97 Surplus Land
Land that is not currently needed to support the existing use but cannot be separated from the property and sold
off for another use. Surplus land does not have an
independent highest and best use and may or may not
contribute value to the improved parcel. (Dictionary)
TPO
Thermoplastic polyolefin, a resilient synthetic roof
covering.

Triple Net (Net Net Net) Lease
An alternative term for a type of net lease. In some
markets, a net net net lease is defined as a lease in which the tenant assumes all expenses (fixed and variable) of operating a property except that the landlord is
responsible for structural maintenance, building reserves, and management; also called NNN lease, net net net
lease, or fully net lease. (Dictionary)
(The market definition of a triple net lease varies; in some cases tenants pay for items such as roof repairs, parking lot repairs, and other similar items.)
Usable Area
The measured area of an office area, store area, or
building common area on a floor. The total of all the
usable areas for a floor shall equal floor usable area of that same floor. (BOMA)
Value-in-Use

1. The amount determined by discounting the future
cash flows (including the ultimate proceeds of
disposal) expected to be derived from the use of an
asset at an appropriate rate that allows for the risk of the activities concerned. (FASB Accounting
Standards Codification, Master Glossary)

2. Formerly used in valuation practice as a synonym for contributory value or use value. (Dictionary)
VTAB (Value of the Total Assets of a Business)
The total amount that the real property, tangible personal property, and intangible property assets of a business
would sell for in an asset-based transaction. (Dictionary) #21..
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Qualifications

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Valbridge Property Advisors Information / Office Locations

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R=38'

EXISTING GEN SET
12' DIAMETER 20,000

LB GAC CONTACTOR,
TYP OF 2
KEY NOTES:

VALVE NORMALLY CLOSED DURING

TREATMENT

TO DISTRIBUTION SYSTEM OR BACKWASH /

OUT PIPING
12" PIPING TO GAC
12" PIPING FROM GAC

BACKWASH
GAC DISTRIBUTION MANIFOLD, SEE DETAIL 1

EXTENSION OF HYPOCHLORITE INJECTION
POINT
APPROX. 2,279 SQ. FT. OF NEW PAVING
APPROX. 3,633 SQ. FT. OF NEW ACCESS RD.

PAVING
APPROX. 131 LF OF NEW WALL

PIPE JUMP, DOES NOT CONNECT TO

DISTRIBUTION PIPELINE
UPON COMPLETION OF McHENRY AVE.

WIDENING, DRIVEWAY WILL BE REBUILT TO

MATCH (F) CURB & GUTTER
16' 7'-4" 35'-4" 8' 8'
EXISTING WELL 70
CHLORINATOR 26'
40' LONG TRUCK
R=38'
(E) CURB &
GUTTER
APPROX.

FUTURE

CURB LINE
24' 118'-2"
105'
~12,326 SQ. FT.
30'
EX. ROAD EASEMENT
90'-2"
City of Modesto
Del Rio Well 70
Alternative 2
Treatment within
Extended Area
Figure 2
N
O:\Clients\418 City of Modesto\12-17-48 Del Rio Well 271\CAD\Figures\418-12-17-48 Figure 2 - B.dwg 6/12/2023 3:52 PM sbarber DETAIL
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

May 6, 2025
Date: April 25, 2025
TO: Mayor and City Council
FROM: Colleen Rozillis, City Auditor
SUBJECT: Consider reviewing and providing comment on the FY25-26 Internal Audit work plan CONTACT: Colleen Rozillis, City Auditor, [email protected], 206-302-6795 DESCRIPTION:

Consider reviewing, providing comment and accepting the proposed Fiscal Year 25-26 Internal Audit Work Plan. (Funding source: Not Applicable)
STRATEGIC PLAN ELEMENT:

The recommended action supports the following 2020-2025 City of Modesto Strategic Plan Initiatives: Goal J: Build a high-performance organization.

BACKGROUND:

The attached work plan was approved by the Audit Committee on April 23, 2025 and forwarded to Council for review and comment. Each year, the City Auditor develops a proposed work plan to address internal controls, compliance, risk, and performance. In accordance with section 902.1 of the Modesto City Charter, “At the beginning of each fiscal year, the Auditor shall submit a one (1) to five (5) year audit schedule to the Audit Committee and Council for review and comment.

The schedule shall include the proposed plan, and the rationale for the selections, for auditing departments, offices, boards, activities, subcontractors, and agencies for the period. This schedule may be amended after review with the Audit Committee and Council, but the Auditor shall have final authority to select the audits planned.” DISCUSSION:

The proposed work plan was informed by the 2024 Internal Controls Review, 2022 Enterprise Risk Assessment, and discussions with Council and management. The City Auditor plans to execute the following projects for FY25-26:
• Enterprise risk assessment
• IT policy review
• Cash handling internal controls testing
• Homelessness response performance audit
• Fee benchmarking and cost recovery audit
• Parks Recreation & Neighborhoods performance audit
• Recommendation validation
• Ongoing Internal Audit services
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City Council, May 6, 2025
FY25-26 Internal Audit Work Plan

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Modesto City CouncilMay 6, 2025

Modesto City Council
May 6, 2025