California Water Code guidelines to analyze the potential impact of the SCP on the sufficiency of water supplies, among other considerations.
The County has formally requested that the City, as the most appropriate water purveyor for the SCP Amendment Area, evaluate its capacity to service the SCP Amendment Area in collaboration with their PEIR Consultant and their associated Subconsultants. At the County’s request, West Yost Associates (West Yost), a member of their PEIR Consultant team, provided Staff with a scope of work for the Water Supply Assessment and Water System Evaluation.
Modesto Municipal Code (MMC) Section 8-3.203 generally requires all purchases, which meet or exceed $100,000 for material, equipment, or contractual services to follow formal bid procedures.
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”.
Here, West Yost is uniquely qualified to perform this task in that they house and oversee the City’s hydraulic model; A digital replica of the City’s water system infrastructure that Staff utilizes through the professional services provided by West Yost to run simulations to predict potential issues and evaluate proposed solutions system wide. Because of West Yost’s significant knowledge of the City’s water system, retaining another firm would result in increased costs as a new consultant would require time to familiarize itself with the City’s water system.
As the County has agreed to cover the Consultant and Staff time costs associated with the preparation of the Water Supply Assessment and Water System Evaluation, the City and County will enter into a Memorandum of Understanding (MOU) to stipulate the roles and responsibilities of each party along with the agreed upon reimbursement requirements and limits.
FISCAL IMPACT:
Expenses associated with this effort will be housed in the following Non-Capital Project:
101666 - Salida Water Supply Assessment
Anticipated Project Expenditures
Engineering Services Agreement $93,100
10% Additional Services, if Needed $9,310
Engineering / Administration / Design – City Staff $10,000 Total $112,410
Per the terms of the MOU, the County will reimburse the City for Consultant costs and associated Staff time up to $112,410 as detailed above.
A budget adjustment in the amount of $112,410 will be necessary from Water Fund Reserves to fully fund this Project.
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Finance Committee, June 23, 2025
Salida Community Plan
Water Supply Assessment and Water System Evaluation
CEQA/NEPA REQUIREMENTS:
The California Environmental Quality Act requires that State and local agencies disclose and evaluate the significant environmental impacts of proposed projects and adopt all feasible mitigation measures to reduce or eliminate those impacts.
The Salida Community Plan Programmatic Environmental Impact Report will assist agencies and developers in identifying and understanding potential environmental issues early in the planning process, allowing for mitigation strategies to be developed and implemented. The report will focus on a broad set of related projects and their cumulative impact, as opposed to focusing on a single specific project.
RECOMMENDED COMMITTEE ACTION:
Staff Recommendations:
Motion recommending an Engineering Services Agreement with West Yost Associates, of Davis, CA for the Salida Community Plan Water Supply Assessment and Water System Evaluation in the amount of $93,100, plus $9,310 in additional services, if needed, for a total Agreement amount not to exceed $102,410 and forwarding to Council for approval.
Motion recommending entering into a Memorandum of Understanding with Stanislaus County regarding reimbursement of costs related to the Salida Community Plan Water Supply Assessment and Water System Evaluation Project and forwarding to Council for approval.
Approved by:
William Wong, Director of Utilities
Joseph P. Lopez, City Manager
Attachments:
1. West Yost - Engineering Services Agreement & all exhibits
2. West Yost - Bid Waiver
3. Stanislaus County Memorandum of Understanding Salida Community Plan Water Supply Assessment and Water System
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ENGINEERING SERVICES AGREEMENT
SALIDA COMMUNITY PLAN
WATER SUPPLY ASSESSMENT AND WATER SYSTEM EVALUATION
THIS AGREEMENT, made and entered into in the City of Modesto, State of California, this day of , 2025, (“Effective Date”) by and between the CITY OF MODESTO, a municipal corporation of the State of California, hereinafter referred to as "CITY", and WEST YOST & ASSOCIATES, INC., a California corporation, hereinafter referred to as "CONSULTANT".
This Agreement is made with regard to the following recitals:
A. The CITY has determined that Engineering Services are required for the Salida Community Plan Water Supply Assessment and Water System Evaluation Project.
B. CONSULTANT represents that it is qualified, willing and able to provide the services to prepare said documents.
NOW, THEREFORE, in consideration of this agreement, and the mutual promises, covenants, and stipulations hereinafter contained, the parties agree as follows:
1. SCOPE OF SERVICES.
CONSULTANT shall undertake and complete the preparation of the scope of work as set forth and described in the documents attached hereto and referred to as Exhibit "A" or "project". The CONSULTANT shall perform the services as described in Exhibit "A" in a manner compatible with the standards of its profession, and shall produce a fully complete project that is acceptable to CITY.
2. TERM OF AGREEMENT.
This Agreement is effective as of the date first written above and will continue in effect until CITY’s acceptance of and payment for all services authorized by CITY #6..
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and performed by CONSULTANT, unless terminated earlier in accordance with the provisions of the termination clause in this Agreement.
CONSULTANT shall undertake and complete the preparation of the scope of work as set forth and described in the documents commonly referred to as “project” attached hereto as Exhibit "A" and made a part hereof. CITY hereby gives CONSULTANT notice to proceed with the preparation of the project in the manner described in Exhibit "A", as of the Effective Date of this agreement. CONSULTANT shall diligently proceed with the preparation of the project and agrees to complete said preparation within the time period set forth in Exhibit "A".
3. COMPENSATION.
CONSULTANT agrees to accept a sum not to exceed NINETY-THREE THOUSAND ONE HUNDRED AND 00/100 DOLLARS ($93,100) (maximum compensation) as full remuneration for performing all services and furnishing all staffing and materials for CITY in accordance with Exhibit "A" attached hereto and for performance by CONSULTANT of all of its duties and obligations under this Agreement, except that additional services may be compensated as described below.
The Compensation shall be paid pursuant in the manner and at the times set forth below:
CITY shall pay CONSULTANT on a time and materials basis for CONSULTANT’s actual costs for all work called for in Exhibit “A” to this Agreement. All work to be performed under this Agreement shall be billed at the hourly rates set forth in Exhibit “B” attached hereto, CONSULTANT shall submit monthly invoices to City which include detailed tasks, hours worked, and billable rates for all work completed, and detailed receipts for #6..
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any out-of-pocket costs paid by CONSULTANT in connection with work performed on this project.
Additional services may be authorized by the City Manager in an amount up to, but not to exceed 10% of the agreed maximum compensation, or NINE THOUSAND THREE HUNDRED TEN AND 00/100 DOLLARS ($9,310). In the event that additional services are deemed necessary, the CONSULTANT shall provide a written request to the City Manager indicating the reason for additional work, scope and cost of such work. The City Manager shall provide a written response to the request, either approving or denying the additional expenditure. If additional services are requested and approved, they will be billed at the hourly rates set forth in Exhibit “B” and may not exceed the amount requested and approved in writing by the City Manager. In that event, the new total compensation shall not exceed ONE HUNDRED TWO THOUSAND FOUR HUNDRED TEN AND 00/100 DOLLARS ($102,410). If additional services in excess of this amount are deemed necessary by City Staff, an amendment to this Agreement will be required and must be approved by the City Council prior to commencing the work, as provided in Paragraph 9 of this agreement.
4. OBLIGATIONS OF CONSULTANT.
Throughout the term of this Agreement, CONSULTANT shall possess, or secure all licenses, permits, qualifications and approvals legally required to conduct business.
CONSULTANT warrants that it has all of the necessary professional capabilities and experience, as well as all tools, instrumentalities, facilities and other resources necessary to provide the CITY with the services contemplated by this Agreement. CONSULTANT further warrants that it will follow the best current, generally accepted and professional practices to make findings, render #6..
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opinions, prepare factual presentations, and provide professional advice and recommendations regarding this project.
5. PERFORMANCE BY KEY EMPLOYEE.
CONSULTANT has represented to CITY that Amy Kwong, will be the person primarily responsible for the performance of the services referred to in this Agreement.
CITY has entered into this Agreement in reliance on that representation by CONSULTANT.
CONSULTANT therefore agrees that ten percent (10%) or more of the time to be devoted to the project that is the subject of this Agreement will be that of the above-named person.
6. OWNERSHIP OF DOCUMENTS/TITLE TO DATA.
Ownership of Documents
All reports, drawings, designs, graphics, working papers and other incidental work or materials furnished hereunder shall become and remain the property of the CITY, and may be used by CITY as it may require without any additional cost to CITY. No reports shall be used by the CONSULTANT for purposes other than this contract without the express prior written consent of CITY.
Title to Data
If, as a part of the agreement, CONSULTANT is required to produce data such as, but not limited to, drawings, plans, specifications, calculations, models, flow diagrams, visual aids and other related materials, the originals of all such data generated under this agreement will be delivered to CITY upon the completion or termination of services under the Agreement.
All materials, documents, data or information obtained from the CITY data files or any CITY medium furnished to CONSULTANT in the performance of this #6..
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Agreement will at all times remain the property of the CITY. Such data or information may not be used or copied for direct or indirect use by CONSULTANT after termination of this Agreement without written consent of the CITY.
7. NEWS AND INFORMATION RELEASE.
CONSULTANT agrees that it will not issue any news releases in connection with either the award of this Agreement, or any subsequent amendment of or efforts under this Agreement, without first obtaining review and approval of said news releases from CITY through the City Manager.
8. CONFLICT OF INTEREST.
CONSULTANT warrants that it presently has no interest and shall not acquire any interest, direct or indirect, which would create a “conflict of interest”, as that term is defined in the Political Reform Act (Gov. Code § 81000 et seq), for the CONSULTANT in the performance of this AGREEMENT. CONSULTANT warrants that, in performance of this AGREEMENT, CONSULTANT shall not employ any person having any such interest.
CONSULTANT understands that, if this AGREEMENT is made in violation of Government Code § 1090 et seq., the entire AGREEMENT is void and CONSULTANT will not be entitled to any compensation for services performed. CONSULTANT agrees to file a Statement of Economic Interests with the City Clerk at the start and end of this AGREEMENT if so, required at the option of CITY.
9. AMENDMENTS.
Both parties to this Agreement understand that it may become desirable or necessary during the execution of this Agreement, for CITY or CONSULTANT to modify the scope of services provided for under this Agreement. Any material extension or change in the #6..
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scope of work shall be discussed with CITY and the change and cost shall be memorialized in a written amendment to the original contract prior to the performance of the additional work.
Until a change order is so executed, CITY will not be responsible to pay any charges CONSULTANT may incur in performing such additional services, and CONSULTANT shall not be required to perform any such additional services.
10. INDEPENDENT CONTRACTOR.
All acts of CONSULTANT, its agents, officers, and employees and all others acting on behalf of CONSULTANT relating to the performance of this Agreement, shall be performed as independent contractors and not as agents, officers, or employees of CITY.
CONSULTANT, by virtue of this Agreement, has no authority to bind or incur any obligation on behalf of City. CONSULTANT has no authority or responsibility to exercise any rights or power vested in the CITY. No agent, officer, or employee of the CITY is to be considered an employee of CONSULTANT. It is understood by both CONSULTANT and CITY that this Agreement shall not under any circumstances be construed or considered to create an employeremployee relationship or a joint venture.
CONSULTANT, its agents, officers and employees are and, at all times during the terms of this Agreement, shall represent and conduct themselves as independent contractors and not as employees of CITY.
CONSULTANT shall determine the method, details and means of performing the work and services to be provided by CONSULTANT under this Agreement.
CONSULTANT shall be responsible to CITY only for the requirements and results specified in this Agreement, and, except as expressly provided in this Agreement, shall not be subjected to CITY's control with respect to the physical action or activities of the CONSULTANT in #6..
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fulfillment of this Agreement. CONSULTANT has control over the manner and means of performing the services under this Agreement. CONSULTANT is permitted to provide services to others during the same period service is provided to City under this Agreement. If necessary, CONSULTANT has the responsibility for employing other persons or firms to assist CONSULTANT in fulfilling the terms and obligations under this Agreement.
If in the performance of this Agreement any third persons are employed by CONSULTANT, such persons shall be entirely and exclusively under the direction, supervision, and control of Consultant. All terms of employment including hours, wages, working conditions, discipline, hiring, and discharging or any other term of employment or requirement of law shall be determined by the CONSULTANT.
It is understood and agreed that as an independent contractor and not an employee of CITY neither the CONSULTANT or CONSULTANT 's assigned personnel shall have any entitlement as a CITY employee, right to act on behalf of the CITY in any capacity whatsoever as an agent, or to bind the CITY to any obligation whatsoever.
It is further understood and agreed that CONSULTANT must issue W-2 forms or other forms as required by law for income and employment tax purposes for all of CONSULTANT's personnel.
As an independent contractor, CONSULTANT hereby indemnifies and holds CITY harmless from any and all claims that may be made against CITY based upon any contention by any third party that an employer-employee relationship exists by reason of this Agreement.
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11. ASSIGNMENT.
Neither this Agreement nor any portion thereof shall be subcontracted or assigned without the express prior written consent of the CITY in each and every instance.
12. PATENT/COPYRIGHT MATERIALS.
Unless otherwise expressly provided in the Agreement, CONSULTANT shall be solely responsible for obtaining the right to use any patented or copyrighted materials in the performance of this Agreement. CONSULTANT shall furnish a warranty of such right to use to CITY at the request of CITY.
13. NOTICES.
Notice required by this Agreement shall be given in writing and shall be deemed given and effective upon receipt provided that such are delivered in accordance with the provisions of this Section. Notices shall be delivered either by: (a) personal delivery (including delivery by an overnight courier service which obtains confirmation of receipt); or (b) by facsimile, provided that such transmission is followed by delivery by an overnight courier service which obtains confirmation of receipt; or (c) postage prepaid, return receipt requested, certified mail; or (d) by electronic transmission subject to reasonable proof that the notice was both transmitted and received. Each such notice shall be sent to the parties at the address respectively set forth below or to such other address as a party may designate by written notice given in accordance with the provisions of this Section:
FOR CONSULTANT: Name: West Yost & Associates, Inc.
Address: 2020 Research Park Drive, Suite #100
Davis, CA 95618
Attention: Amy Kwong
Phone: (530) 756-5905
E-mail: [email protected]
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FOR CITY: Name: City of Modesto
Address: 1010 10th Street, Suite 4600
Modesto, CA 95354
Attention: Jim Alves
Phone: (209) 571-5557
E-mail: [email protected]
14. INSURANCE REQUIREMENTS.
During the term of this Agreement, CONSULTANT shall maintain in full force and effect at its own cost and expense the insurance coverage as set forth in Exhibit C, attached hereto and incorporated herein, and shall otherwise comply with the other provisions of Exhibit C. CONSULTANT is responsible for uploading updated insurance documentation to the City’s “PINS Advantage” program.
15. TERMINATION OF AGREEMENT.
Termination by CITY for Default of CONSULTANT
Should CONSULTANT default in the performance of this Agreement or materially breach any of its provisions, at its option, CITY may terminate this Agreement by giving written notification to CONSULTANT. The termination date shall be the effective date of the notice. For the purposes of this section, material breach of this Agreement shall include, but not be limited to, any of the following: failure to perform required services or duties, willful destruction of CITY's property by CONSULTANT, dishonesty or theft.
Termination by City for Convenience
The CITY may also terminate the CONSULTANT 's performance under the Agreement, either in whole or in part, at its own discretion, or when conditions encountered during the Work make it impossible or impracticable to proceed, or when the CITY is prevented from proceeding with the Agreement by act of God, by law, or by official action of a public authority, or upon a #6..
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determination by the CITY that such termination is in the best interest and convenience of the CITY, or whenever the CITY is prohibited from completing the Work for any reason. The CITY shall provide no less than ten (10) calendar days written notice of its intent to terminate the Agreement for convenience, and shall endeavor to provide the CONSULTANT with consultation with the CITY prior to termination.
Post-Termination Procedure
Upon receipt of a written notice of termination pursuant to either of the foregoing paragraphs, the CONSULTANT shall:
a. Cease its work as directed in the notice of termination as of the termination date and see to it that its employees, subconsultants and agents are notified of such termination and act as specified in the notice of termination;
b. Terminate all orders and Subconsultants except as necessary to complete any portion of the Work that is not terminated; c. If directed in writing by the CITY to do so, assign all right, title and interest in subcontracts and materials in progress to CITY, in which case the CITY will have the right at its discretion to settle, or pay any or all claims arising out of the termination of such subconsultants, but in no event shall recovery by any CONSULTANT or subconsultant include lost profits for portions of the Work not completed or undertaken, including materials not delivered;
d. Deliver or otherwise make available to the CITY all data, #6..
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drawings, specifications, reports, estimates, summaries and such other information and material as may have been accumulated by the CONSULTANT in performing the Work whether completed or in process;
e. Settle outstanding liabilities and claims, subject to the approval of CITY;
f. Complete performance of such part of the Work as has not been terminated;
g. Take such other actions as may be necessary, or as may be directed by the CITY for the protection and preservation of the Work and/or property related to the Work;
h. If CITY so requests, and at CITY's cost, CONSULTANT shall provide sufficient oral or written status reports to make CITY reasonably aware of the status of CONSULTANT 's work on the project.
i. The CONSULTANT understands and agrees that CITY may, in CITY's sole discretion, refuse to pay CONSULTANT for that portion of CONSULTANT's services which were performed by CONSULTANT on the project prior to the termination date and which remain unacceptable and/or not useful to CITY as of the termination date.
CITY will pay CONSULTANT an amount based on the percentage of satisfactory work completed in accordance with the notice of termination. The final payment to #6..
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the CONSULTANT after termination for convenience shall be limited to amounts due and owing under the Agreement at time of termination, including the following:
a. The cost of settling and paying valid claims arising out of the termination of the Work such as subconsultant agreements or contracts for materials;
b. The Agreement price allocable to the portion of the Work properly performed or goods supplied to the work site by the CONSULTANT as of the date of termination, as determined in accordance with the notice of termination, reduced by any sums previously paid to the CONSULTANT.
Authorization to Terminate Agreement
Termination of the Agreement may be invoked by the City Manager, or his/her designee, subject to the right of the CONSULTANT to appeal the City Manager, or his/her designee’s, decision to the City Council. The CONSULTANT shall appeal by notifying the City Clerk in writing within ten (10) calendar days of receipt of written notification from City of termination of the Agreement. In the event that termination of this Agreement is upheld by the City Council, any cessation of payment of delay claims, extended claims, Eichleay claims, or any other claims for delay shall be retroactive to the date of termination selected by the City Manager, or his/her designee.
16. CERTIFIED PAYROLL REQUIREMENT.
If CONSULTANT is performing “public works” as defined in Labor Code section 1720(a), CONSULTANT shall pay all workers, and shall ensure its subcontractors pay all of their workers, engaged in performing the services described in Exhibit “A” not less than the general #6..
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prevailing rate of per diem wages for work of a similar character in the locality in which the services described in Exhibit “A” 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 City has obtained the general prevailing wages in the locality in which the services described in Exhibit A 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 CITY’s Purchasing Department and shall be made available on request. CONSULTANT must comply with all applicable laws and regulations that apply to wages earned in performance of the services described in Exhibit “A”, including those set forth in Labor Code section 1770 et. seq.
17. INDEMNITY.
If CONSULTANT is Design Professional performing design professional services, as defined in California Civil Code section 2782.8, CONSULTANT agrees to indemnify, defend, and hold harmless the CITY, its agents, officers, officials, employees and volunteers, from and against any and all claims, demands, costs, or liability that arise out of, or pertain to, or relate to the negligence, recklessness, or willful misconduct of CONSULTANT and its employees, officials, officers, or agents in the performance of services under this Agreement, but this indemnity does not apply to liability for damages arising from the sole negligence, or willful misconduct of the CITY. The CITY agrees that in no event shall the cost to defend charged to the CONSULTANT exceed that CONSULTANT’s proportionate percentage of fault.
However, notwithstanding the previous sentence, in the event one or more defendants is unable to pay its share of defense costs due to bankruptcy or dissolution of the business, the CONSULTANT shall meet and confer with other parties regarding unpaid defense costs. This #6..
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duty to indemnify shall not be waived or modified by contractual Agreement or acts of the parties.
If CONSULTANT is not a Design Professional performing Design Professional Services, the CONSULTANT shall hold the CITY, its agents, officers, employees, and volunteers harmless from and save, defend and indemnify them against any and all claims, losses, liabilities, judgments or damages from every cause, including but not limited to injury to person or property or wrongful death, including reasonable costs and expenses of defense of any judicial or administrative action, arising directly or indirectly out of any negligent or intentional act or omission of CONSULTANT, or its agents, officers, officials, employees, or volunteers relating to or during the performance of its obligations under this Agreement, except for claims arising from the sole negligence of the CITY.
CONSULTANT's obligation to defend, indemnify, and hold the CITY, its agents, officers, and employees harmless under the provisions of this paragraph is not limited to or restricted by any requirement in this Agreement for CONSULTANT to procure and maintain a policy of insurance.
In the event that CONSULTANT or any employee, agent, or subcontractor of CONSULTANT providing services under this Agreement is determined by a court of competent jurisdiction or the California Public Employees Retirement System (PERS) to be eligible for enrollment in PERS as an employee of CITY, CONSULTANT shall indemnify, defend, and hold harmless CITY for the payment of any employee and/or employer contributions for PERS benefits on behalf of CONSULTANT or its employees, agents, or subcontractors, as well as for the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of CITY.
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18. DISPUTE RESOLUTION.
Venue for all claims, controversies, or disputes arising out of, or relating to the formation of this Agreement, or the breach, termination execution, enforcement, interpretation, or validity of this Agreement, including the determination of the scope or applicability of this contract provision shall be in the Superior Court of Stanislaus County or the United States District Court for the Eastern District of California.
19. ATTORNEY’S 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. ENTIRE AGREEMENT.
This Agreement and its exhibits contain the entire understanding between CONSULTANT and CITY. Additional or new terms contained in this Agreement which vary from CONSULTANT's proposal are controlling and are deemed accepted by CONSULTANT by shipment of any article or other commencement of performance hereunder. All previous proposals, offers and communications relative to this Agreement, whether oral or written, are hereby superseded except to the extent that they have been incorporated into this Agreement. No future waiver of or exception to any of the terms, conditions, and provisions of this Agreement shall be considered valid unless specifically agreed to in writing by all the parties. #6..
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20. 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.
21. WAIVER.
The waiver by any party to this Agreement of a breach of any provision hereof shall be in writing and shall not operate or be construed as a waiver of any other or subsequent breach hereof unless specifically stated in writing.
22. AUDIT.
The CITY's duly authorized representative shall have access at all reasonable times to all reports, contract records, contract documents, contract files, and personnel necessary to audit and verify CONSULTANT's charges to City under this Agreement.
CONSULTANT agrees to retain reports, records, documents, and files related to charges under this Agreement for a period of four (4) years following the date of final payment for CONSULTANT services. CITY's representative shall have the right to reproduce any of the aforesaid documents.
23. GOVERNING LAW.
This Agreement shall be governed according to the laws of the State of California.
24. HEADINGS NOT CONTROLLING.
Headings used in the Agreement are for reference purposes only and shall not be considered in construing this Agreement.
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25. COMPLIANCE WITH LAWS.
CONSULTANT shall insure compliance with all safety and hourly requirements for employees, in accordance with federal, state, and county safety and health regulations and laws. CONSULTANT shall fully comply with all applicable federal, state, and local laws, ordinances, regulations and permits.
26. CITY BUSINESS LICENSE.
Consultant will have a City of Modesto business license.
IN WITNESS WHEREOF, the City of Modesto, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attestation by its City Clerk under authority of Resolution No. 2025- , adopted by the Council of the City of Modesto on the day of , 2025, and WEST YOST & ASSOCIATES, INC. has caused this agreement to be duly executed in duplicate as of the Effective Date. (Signatures on next page)
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West Yost Scope of Services and Fee Proposal
Salida Community Plan Evaluaon –
Water System Engineering Support
March 6, 2025
1 BACKGROUND
West Yost has been requested to provide a scope of work to prepare a water supply assessment (WSA) and perform a water system evaluaon to determine the future potable water supply and water system infrastructure needed to support the Salida Community Plan (Salida Plan). The WSA will evaluate whether there are adequate water supplies from the City of Modesto (City) to reliably serve the Salida Plan area in the future, in compliance with the requirements of Senate Bill (SB) 610 and SB 221. The water system evaluaon will include hydraulic conveyance and facility capacity analyses to idenfy planning-level recommendaons and improvements that would be needed to support development within the Salida Plan area.
The Salida Plan includes planning and guidance for the development of approximately 4,600 acres of land in the Salida area, which includes the exisng community of Salida (referred to as the Exisng Plan Area), as well as approximately 3,380 acres of planned future development (referred to as the Amendment Area). The potable water system in the Exisng Plan Area is currently served by the City and it’s ancipated that the Amendment Area would also be served by the City, although that would require approval by Modesto’s City Council. It would also require new pipeline extensions and other potenal infrastructure and supply improvements to provide adequate potable water service.
The Salida Plan was adopted through an iniave process in 2007, and the iniave suggested that a programmac Environmental Impact Report (PEIR) should be completed. Ascent is preparing a PEIR on behalf of Stanislaus County (County) to meet the requirements of the 2007 iniave. As part of the PEIR process, the County has requested an assessment of the ability of the City’s exisng water system to serve the Amendment Area in the future. This scope of work addresses the needs associated with that request.
West Yost is also evaluang the wastewater collecon and treatment system within the Amendment Area, as well as storm drainage and flood control needs. However, those evaluaons are being conducted under a separate contract with Ascent. West Yost’s proposed scope of services for the WSA and water system evaluaon are further described below.
SCOPE OF SERVICES
The following is a list of the key tasks necessary to perform this proposed scope of services:
Task 1. Prepare Water Supply Assessment
Task 2. Perform Water System Evaluaon
Task 3. Project Management and Meengs
Task 1 will include the effort needed to refine the City’s water supply and demand assumpons, which will be foundaonal to the WSA report. Supply and demand assumpons developed in Task 1 will then inform the evaluaons performed in Task 2, the findings of which will be summarized in a Technical Memorandum (TM). Task 3 includes all meengs and project management tasks necessary to support Tasks 1 and 2. Each of these tasks is further described below.
Task 1. Prepare Water Supply Assessment
West Yost will prepare a WSA and Water Supply Verificaon for the Salida Plan in accordance with the requirements of SB 610 and SB 221. As part of that effort, West Yost will work with the City to determine whether
EXHIBIT A
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West Yost Scope of Services and Fee Proposal
Salida Community Plan Evaluaon –
Water System Engineering Support
March 6, 2025
2 supply and demand assumpons used in the City’s 2020 Urban Water Management Plan (UWMP)1 need to be refined to reflect changes that have occurred since 2021. This will include up to one 1-hour meeng with the City (budgeted under Task 3) to discuss supply and demand assumpons. Before this meeng, West Yost will review recent producon informaon to determine if adjustments should be made to projected water demands from the 2017 Water Master Plan (WMP)2
. A water demand projecon associated with the Amendment Area has been esmated under the County’s PEIR process, but may be refined with the City to reflect updated assumpons.
West Yost will then conduct an evaluaon of available water supplies and their ability to meet future water demands, including those assisted with the Amendment Area, under normal, single dry, and mulple dry year condions. The City’s 2020 UWMP will be referenced to evaluate supplies and supply reliability, but input provided by the City will be incorporated.
A Dra WSA will be prepared and submied for review and comment by the City. West Yost will conduct up to one addional 1-hour meeng to review the Dra WSA (budgeted under Task 3). A Final WSA will be prepared and submied based on consolidated comments received on the Dra WSA.
Task 1 Assumpons
The WSA will evaluate buildout of the Amendment Area without phasing (no interim condions), based on the land uses shown in the Salida Community Plan.
Task 1 Deliverables
One electronic (PDF) copy of the Dra WSA will be submied for comment. Following receipt of consolidated, wrien comments on the Dra WSA, West Yost will address comments and provide one electronic (PDF) copy of the Final WSA.
Task 2. Perform Water System Evaluaon
The following sections outline the steps West Yost will take to evaluate and determine the water system infrastructure needed to serve the Amendment Area.
Task 2.1 Perform Facility Capacity Evaluaons
West Yost will perform supply, pumping, and storage capacity evaluaons for the City’s exisng and future systems to confirm if exisng infrastructure and infrastructure improvements previously recommended in the City’s 2017 WMP are sufficient to meet the needs of the Amendment Area. The evaluaons will use the performance criteria from the 2017 WMP. If previously recommended infrastructure is insufficient to meet the future needs of the Amendment Area, improvements will be recommended to migate the deficiencies. The supply and demand assumpons from Task 1 will be incorporated into these evaluaons. The results of the capacity evaluaons will be included in the TM included in a later secon.
1 West Yost, 2021. Joint 2020 Urban Water Management Plan Prepared for City of Modesto and Modesto Irrigaon District. June 2021.
2 West Yost, 2017. City of Modesto Water Master Plan. September 2017.
EXHIBIT A
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West Yost Scope of Services and Fee Proposal
Salida Community Plan Evaluaon –
Water System Engineering Support
March 6, 2025
3 Task 2.2 Review Data and Update Hydraulic Model
Although the City’s hydraulic model was recently updated, as described in a model update TM from December 20243
, that version of the model has not been validated yet and does not contain any future system scenarios.
Therefore, West Yost will use the model that was developed for the 2017 WMP to evaluate the Amendment Area.
West Yost will first scale exisng and future system-wide demands to match the demands assumpons from Task 1.
It is assumed that minor facility operaonal updates will need to be performed in the model to the area immediately adjacent to the Amendment Area (i.e., updang the status of nearby wells).
West Yost will then update the City’s hydraulic model with future backbone pipelines and esmated water demands for the Amendment Area. Future water demands for the Amendment Area will be consistent with the esmate developed in Task 1.
Task 2.3 Perform Hydraulic Evaluaon
Once the hydraulic model is updated as described above, West Yost will use it to evaluate the impact of future development in the Amendment Area on the City’s exisng and future water distribuon system. It is assumed that the hydraulic evaluaon will include the following four steady-state scenarios:
Exisng maximum day demand plus fire flow condion
Exisng peak hour demand condion
Buildout maximum day demand plus fire flow condion
Buildout peak hour demand condion
Results will only be presented for the poron of the City’s distribuon system that is immediately adjacent to the Amendment Area. The fire flow and pressure criteria from the City’s 2017 WMP will be used to evaluate the City’s ability to serve the Amendment Area.
If the exisng and/or future water system infrastructure cannot meet the established criteria, West Yost will determine the improvements required to migate the idenfied deficiencies. The recommended improvements will be sized using the performance criteria presented in the City’s 2017 WMP. West Yost will then conduct one 1- hour meeng (budgeted in Task 3) to review dra results with the City and receive comments before preparing a Dra TM.
Task 2.4 Develop Cost Esmate
Once improvements are idenfied for the Amendment Area, planning-level construcon cost esmates will be developed for those improvements. The construcon cost esmates will be based on costs for similar sized projects that West Yost has worked on recently in California. All costs will be provided as Class 5 esmates, consistent with the classificaon system established by the Associaon for the Advancement of Cost Esmang Internaonal. West Yost will summarize the construcon cost esmates within the TM described in the next secon.
Task 2.5 Develop Technical Memorandum
West Yost will prepare a Draft TM documenting the findings and recommendations from the capacity and hydraulic evaluations with associated costs for proposed improvements. West Yost will then conduct one 1-hour meeting with 3 West Yost, 2024. City of Modesto Water System Hydraulic Model Update TM, December 2024.
EXHIBIT A
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West Yost Scope of Services and Fee Proposal
Salida Community Plan Evaluaon –
Water System Engineering Support
March 6, 2025
4 the City to review the findings and discuss comments on the Draft TM (budgeted in Task 3). After the meeting, West Yost will address City comments and produce a Final TM.
Task 2 Assumpons
The Water System Evaluaon will evaluate buildout of the Amendment Area without phasing (no interim condions), based on the land uses shown in the Salida Community Plan. West Yost will use the City’s 2017 WMP hydraulic model.
Task 2 Deliverables
One electronic (PDF) copy of the Dra TM will be submied for comment. Following receipt of consolidated, wrien comments on the Dra TM, West Yost will address comments and provide one electronic (PDF) copy of the Final TM.
Task 3. Project Management and Meengs
West Yost ancipates several meengs with the City at key milestones to review progress. Meengs at the following milestones are ancipated and included in this Scope of Services:
One (1) kickoff meeng to review and confirm key supply and demand assumpons for the WSA One (1) meeng at the compleon of Task 1 to discuss any quesons or comments on the Dra WSA One (1) meeng part way through Task 2 to review the inial potable water system evaluaon results. One (1) meeng at the compleon of Task 2 to discuss the potable water system evaluaon results and recommendaons (Dra TM)
Three (3) addional meengs to provide as-needed coordinaon Addional meengs beyond those described above are not included in this Scope of Services but could be added with wrien approval and associated budget amendment.
West Yost will provide overall project management acvies to keep this project on schedule and within budget.
Communicaon of project progress will generally be provided via emails and conference calls. Monthly invoices will also be prepared and submied.
Task 3 Assumpons
West Yost parcipaon in meengs will be virtual.
The Project will take no longer than five months to complete.
Task 3 Deliverables
West Yost will prepare monthly invoices and descriptions of services performed.
PROJECT BUDGET
West Yost’s proposed level of effort and budget for each of the tasks described above is shown in Table 1. West Yost will perform the scope of services described above on a me-and-expenses basis, at the billing rates set forth in West Yost’s aached 2025 Billing Rate Schedule (Aachment A), with a not-to-exceed budget of $93,100. Any
EXHIBIT A
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West Yost Scope of Services and Fee Proposal
Salida Community Plan Evaluaon –
Water System Engineering Support
March 6, 2025
5 addional services not included in this scope of services will be performed only aer receiving wrien authorizaon and a corresponding budget amendment.
Table 1. Esmated Project Hours and Budget
Task Hours Budget, dollars
Task 1. Prepare Water Supply Assessment 123 $32,700
Task 2. Perform Water System Evaluaon 158 $41,300
Task 3. Project Management and Meengs 64 $19,100
Total 345 $93,100
SCHEDULE
West Yost will begin work upon noce to proceed and the receipt of all requested data. We ancipate that the development of the Dra WSA will take approximately eight (8) weeks to complete aer noce to proceed and receipt of the requested data. Following the Dra WSA, the Dra Water System Evaluaon TM will take an addional eight (8) weeks to complete. The schedule for the Final Water System Evaluaon TM and Final WSA will be determined aer receipt of City comments. The Project is ancipated to last approximately five (5) months.
EXHIBIT A
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EXHIBIT B
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EXHIBIT B
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EXHIBIT C – Insurance Requirement for Professional Services Consultant shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder and the results of that work by the Consultant his agents, representatives, employees or subconsultants.
MINIMUM SCOPE AND LIMIT OF INSURANCE
Coverage shall be at least as broad as:
1. 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 $1,000,000 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: ISO Form Number CA 00 01 covering any auto (Code 1), or if Contractor has no owned autos, hired, (Code 8) and non-owned autos (Code 9), with limit no less than $1,000,000 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.
(Not required if consultant provides written verification, it has no employees)
4. Professional Liability (Errors and Omissions) Insurance appropriates to the Consultant’s profession, with limit no less than $2,000,000 per occurrence or claim, $2,000,000 aggregate.
If the consultant maintains broader coverage and/or higher limits than the minimums shown above, the City of Modesto requires and shall be entitled to the broader coverage and/or the higher limits maintained by the consultant. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City of Modesto.
Umbrella or Excess Coverage
The Consultant 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 #6..
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to a loss covered hereunder, shall be called upon to contribute to a loss until the Consultant’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 Consultant 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 Consultant’s insurance with coverage equal to ISO form CG 2010. If Completed Operations endorsement is required, a separate endorsement equal to ISO form CG 2037 is required.
Primary Coverage
The Additional Insured coverage under the Consultant’s policy shall be “primary and noncontributory” and will not seek contribution from the City’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 Consultant’s insurance coverage to the sole negligence of the Named Insured.
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
Consultant hereby grants to City of Modesto a waiver of any right to subrogation which any insurer of said Consultant may acquire against the City of Modesto by virtue of the payment of any loss under such insurance. Consultant 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 City of Modesto 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 City of Modesto may require the Consultant to purchase coverage with a lower retention or provide proof of the 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 consultant or subconsultant 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 City of Modesto.
Claims Made Policies (applicable to Professional Liability only) If any of the required policies provide claims-made coverage:
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1. The Retroactive Date must be shown and must be before the 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 the contract of work.
If coverage is canceled or non-renewed and not replaced with another claims-made policy form with a Retroactive Date prior to the contract effective date, the Consultant must purchase “extended reporting” coverage for a minimum of five (5) years after completion of work.
Verification of Coverage
Consultant shall furnish the City of Modesto with original certificates and amendatory endorsements or copies of the applicable policy language affecting 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 Consultant’s obligation to provide them. The City of Modesto 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.
Subconsultants
Consultants shall require and verify that all subconsultants, or other parties hired for this work, purchase and maintain coverage for indemnity and insurance requirements as least as broad as specified in this agreement to the extent they apply to the scope of the subconsultant’s work with the same certificate of insurance requirements and naming as additional insureds all parties to this contract.
Special Risks or Circumstances
City of Modesto 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
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Cristian Ciotau (Apr 14, 2025 06:19 PDT)
Cristian Ciotau 04/14/25
William Wong (Apr 14, 2025 09:18 PDT)
William Wong 04/14/25
Mark Bolden (Apr 14, 2025 16:34 PDT)
Mark Bolden 04/14/25
The Dept. has effectively detailed the cost savings in their business Justification and supporting documentation. I approve of this Bid Waiver. 04/15/25
04/15/25
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BidWaiver-WestYost-WaterSupply
Assessment&Evaluation
FinalAuditReport 2025-04-15
Created: 2025-04-11
By: CynthiaBatista([email protected])
Status: Signed
TransactionID: CBJCHBCAABAAhunJc5qXBS_Rx59it3QgI5lzVEe1lhjV "BidWaiver-WestYost-WaterSupplyAssessment&Evaluatio
n"History
DocumentcreatedbyCynthiaBatista([email protected]) 2025-04-11-9:53:36PMGMT
DocumentemailedtoCristianCiotau([email protected])forsignature 2025-04-11-9:53:52PMGMT
EmailviewedbyCristianCiotau([email protected])
2025-04-12-1:24:33AMGMT
Documente-signedbyCristianCiotau([email protected]) SignatureDate:2025-04-14-1:19:34PMGMT-TimeSource:server DocumentemailedtoWilliamWong([email protected])forsignature 2025-04-14-1:19:39PMGMT
EmailviewedbyWilliamWong([email protected])
2025-04-14-4:14:21PMGMT
Documente-signedbyWilliamWong([email protected])
SignatureDate:2025-04-14-4:18:34PMGMT-TimeSource:server DocumentemailedtoMarkBolden([email protected])forsignature 2025-04-14-4:18:38PMGMT
EmailviewedbyMarkBolden([email protected])
2025-04-14-4:19:14PMGMT
Documente-signedbyMarkBolden([email protected])
SignatureDate:2025-04-14-11:34:12PMGMT-TimeSource:server #6..
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DocumentemailedtoDianneLove([email protected])forsignature 2025-04-14-11:34:16PMGMT
EmailviewedbyDianneLove([email protected])
2025-04-15-8:22:46PMGMT
Documente-signedbyDianneLove([email protected])
SignatureDate:2025-04-15-8:27:06PMGMT-TimeSource:server DocumentemailedtoDeAnnaChristensen([email protected])forsignature 2025-04-15-8:27:11PMGMT
EmailviewedbyDeAnnaChristensen([email protected]) 2025-04-15-8:27:40PMGMT
Documente-signedbyDeAnnaChristensen([email protected]) SignatureDate:2025-04-15-8:43:05PMGMT-TimeSource:server Agreementcompleted.
2025-04-15-8:43:05PMGMT
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CITY OF MODESTO
COMMITTEE AGENDA REPORT
DATE OF MEETING:
June 23, 2025
Date: April 30, 2025
TO: Finance Committee
Rosa Escutia-Braaton, Chair
David Wright, Vice-Chair
Nick Bavaro, Member
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
SUBJECT: Amendment to SpryPoint Services, Inc. Agreement CONTACT: Jeni Martin, Revenue Collections and Compliance Manager [email protected] , 209-571-5892
DESCRIPTION:
Consider the First Amendment with SpryPoint Services, Inc., Charlottetown, P.E., for Utility Billing, Receivables and Cashiering Softwares to include SpryWallet as the Payment Gateway with an increase in the amount of $1,336,902 over two (2) years and forwarding to Council for approval. (Funding Source: Various Funds)
STRATEGIC PLAN ELEMENT:
This item supports the City of Modesto 2025-2026 Strategic Plan focus of Governance and Service Delivery: Build community trust in City government through responsive, transparent, and efficient service delivery. This aligns with Goal J: Build a high-performance organization by exploring “Smart Cities” initiatives and develop related policies to leverage technology to address key community needs and interests.
BACKGROUND:
The Finance Department Utility Billing Division, Accounts Receivable Division, and Cashiering Division manage and facilitate the billing and collection of revenues for water, sewer, storm drain, garbage, and miscellaneous receivables for various City departments.
The Utility Billing Division issues bills for water, sewer, storm drain, and garbage services for over 76,000 utility accounts monthly with over 900,000 bills going out annually. The current system has reached its end of life with outdated technology. There have been no enhancements to the product for at least five (5) years with manual updates required to fix outstanding issues several times per year.
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Finance Committee, June 23, 2025
Amendment to SpryPoint Services, Inc., Agreement
On October 23, 2018, Council approved Resolution No. 2018-466 to execute an Agreement with Paymentus, Inc., who integrates the online payment portal and acts as a payment gateway with our current software system to facilitate online payments, for a total amount of $1,660,000 over five (5) years.
On July 12, 2019, the City Manager approved the First Amendment to the Agreement with Paymentus, Inc., adding eCheck as an additional payment option for miscellaneous receivables customers with no change to the Council approved agreement amount.
On December 8, 2020, Council approved the Second Amendment with Paymentus, Inc., by Resolution No. 2020-512 to increase the Agreement amount by $1,647,537 from $1,660,000 to a new total amount of $3,307,537.
On June 29, 2023, City Manager approved the Third Amendment for fee changes with no change to the Council approved Agreement amount. As part of the integration process with the SpryPoint Services software, the City anticipated integrating the current online payment gateway with the SpryPoint online portal, SpryEngage, so there would be no disruption to the ability to make online payments. The anticipated cost to this integration with Paymentus is $6,000.
On November 14, 2023, by Resolution No. 2023-507, City Council approved entering into an Agreement with SpryPoint Services, Inc., utilizing the City of Aurora’s competitive solicitation and Agreement to obtain a cloud-based Software as a System (SaaS) product that allows for streamlined collection and processing of customer billing information by utilizing current technology to communicate with our customers, improving the customer service experience, and reducing the resources required by Information Technology (IT) staff to maintain the system. As part of this project, this software solution includes the replacement of our point of sale (POS) cashiering system and miscellaneous accounts receivable system at no additional cost.
DISCUSSION:
SpryWallet:
The Finance Department issues over 900,000 bills annually for water, sewer, storm drain, garbage, and miscellaneous receivables for various City departments. In order to facilitate the number of payments received and provide convenience for our residents, the City offers various payment options including paying utility bills online. In Fiscal Year 2023-2024, the City received over 376,000 payments through our online utility billing payment portal. Historically, the number of customers who utilize this online service has grown each year, and with a complete modernization of the billing software system and online payment portal, staff anticipate this growth to continue.
SpryPoint Services developed and launched their own integrated payment gateway called SpryWallet in July 2024, no longer requiring a third-party payment gateway. This option was not available when the original Agreement was signed with SpryPoint Services; therefore, the City had no option but to continue to integrate with Paymentus as a third-party provider to facilitate the online payments. If the City were to replace Paymentus with SpryWallet as the online payment gateway, the entire online payment process would remain in the same ecosystem of SpryPoint.
If the City transitions the online payment gateway to SpryWallet, there is no initial setup fee. Since the integration with Paymentus will no longer be needed, this would result in a $6,000 savings to the project. The ongoing cost for processing online payments would also remain neutral for the #7..
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Finance Committee, June 23, 2025
Amendment to SpryPoint Services, Inc., Agreement
processing fee per payment; however, staff anticipates a continuing increase in the number of online payments. Based on estimated growth projections, this will require an increase to the annual agreement with SpryPoint by 25% for each fiscal year of the contract. The City will terminate its Agreement with the current payment gateway, Paymentus, for the next two (2) years at a cost of $1,565,032 and initiate SpryWallet as the payment gateway at a cost of $1,336,902, with an estimated savings of $228,130.
This item was reviewed by the Technology Steering and Alignment Committee (TSAC) at the meeting held May 29, 2025, and the Committee recommended forwarding the item to the Finance Committee for consideration.
SpryBackflow:
The Water Division Backflow Control Program (BCP) requires all commercial and industrial businesses in the City to have a backflow prevention assembly. These devices allow water to travel in only one (1) direction to protect our drinking water supply. The BCP keeps a record of all devices throughout the City. Owners must have the devices tested each year by a certified tester to ensure proper functionality, and the results must be reported to the City. The current backflow management software is outdated with technological limitations, requiring most processes to be managed manually.
The SpryBackflow module is a component of the SpryPoint Services ecosystem, integrated with SpryCIS and SpryMobile, creating a nexus between the customer and all service orders relating to the property. Currently, these systems do communicate with one another, requiring staff to utilize multiple applications to locate all information related to the utilities for any given property.
In addition, the SpryBackflow module allows certified testers to view and submit their test results online and provides the Backflow Control Program team the ability to communicate more efficiently and effectively with their customers, notifying them with alerts for upcoming and past due tests via text, email, and letter.
When the original Agreement was executed with SpryPoint Services, Inc., the backflow management application was an optional module that could be added later. Since that time, the Utilities Division requested the addition of this application to the scope of the project. In May of 2024, the SpryBackflow module was added to the project, with the Amendment being executed under the authority of the City Manager at an implementation cost of $38,000. This includes the implementation of the conversion, configuration, testing and training of the SpryBackflow software. The Agreement does not need to be increased for the initial conversion cost as this has been incorporated as part of the project’s contingency. There will be an ongoing increase to the annual maintenance agreement of $14,000, however, which is based on the number of backflow assemblies.
Future Integrations:
Future integrations and enhancements were not part of the scope of work when the request for purchase was issued. By integrating these software systems with SpryPoint, the Utility Billing Division can track and manage permits established for new water services and simultaneously comply with State regulations regarding water use and water conservation allocation. Trakit – The City currently uses the software Trakit for managing all permits that are issued from the Planning Division and Engineering Department. Currently, new permits must be manually tracked to ensure new service locations are set up and billing activated. #7..
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Finance Committee, June 23, 2025
Amendment to SpryPoint Services, Inc., Agreement
Eagle Aerial – The City currently utilizes the Eagle Aerial software to manage allocation of domestic and landscape water permeation for State legislation requirements regarding water use and conservation.
Modesto Municipal Code Section 8-3.203 generally requires all purchases, which meet or exceed $100,000 for material, equipment or contractual services to be formally bid. However, exceptions to the formal bidding process are granted in MMC 8-3.204(f) “Where the Purchasing Manager, in her discretion, determines that it is appropriate to amend the services or goods provided under an existing agreement to include additional similar goods or services, or limited quantity or scope, in order to increase efficiency and avoid delays or disruptions to City projects or service. This amendment is continuing with the existing services but expanding the services to include SpryWallet as the Payment Gateway.
FISCAL IMPACT:
The proposed implementation of SpryWallet and future integration needs would result in an increase to the two-year agreement with SpryPoint Services, Inc., in an amount of approximately $1,336,902. This is a reduction in the amount approved by Council for the current two-year agreement with Paymentus services of $1,556,032 and an estimated overall cost savings to the project of $228,130 over the current payment gateway and approved project budget.
Paymentus services are currently budgeted and paid for via the Revenue Clearing Fund. These expenses are offset by the interest earned on the City’s investment portfolio for the specific service areas. SpryWallet will replace Paymentus, and expenses will continue to be offset by the interest earned on the City’s investment portfolio.
Staff is requesting a total increase of $1,336,902 to the Agreement budget as shown on Table #1.
Table #1
Fund AccountingString Original Agreement Amendment Amount Revised Amount Water Fund 4100-41420-53300 1,148,141 1,148,141
Sewer Fund 4210-41320-53300 837,186 837,186
Storm Drain Fund 4480-41220-53300 71,759 71,759
GarbageFund 0100-12420-53300 334,874 334,874
RevenueClearingFund 0130-12191-48010 - 1,336,902 1,336,902 Total 2,391,960 1,336,902 3,728,862
The Payment gateway funds are not being incorporated to the Project amount as these fees would not be paid out of the project. The Funding for the expenses for the implementation of SpryPoint is currently budgeted in Project 101396.
RECOMMENDED COMMITTEE ACTION:
Staff Recommendations:
Motion recommending the First Amendment increasing the Agreement amount with SpryPoint Services, Inc., Charlottetown, P.E., for Utility Billing, Receivables and Cashiering Softwares, to include SpryWallet as the Payment Gateway by $1,336,902, to a new total agreement amount not to exceed $3,728,862 through the next two (2) years and forwarding to Council for approval. #7..
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Finance Committee, June 23, 2025
Amendment to SpryPoint Services, Inc., Agreement
Approved by:
DeAnna Christensen, Director of Finance
Joseph P. Lopez, City Manager
Attachments:
1. SpryWallet Amendment
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Version: 05202025 SpryWallet Order Form Page 1 of 14
SpryWallet Order Form
1. Client Information
This SpryWallet Order Form (“Order Form”) is entered into by SpryPoint Services, Inc. (“SpryPoint”) and Client and is subject to the terms and conditions of the Master Subscription Agreement (the “Agreement”) between the Parties. The Order Form shall come into effect on the date signed by the Parties (“Effective Date”).
Name (“Client” or “Sub-Merchant”) City of Modesto
Client Billing Contact Name Jennifer Martin
Client Billing Contact Phone
Number
Client Billing Contact Email
Client Billing Address
2. Initial Term
The initial term of the subscription for SpryWallet will commence on the Effective Date and Client’s SpryWallet Subscription will renew annually on the anniversary of the Effective Date for a period of 1 year.
3. Invoicing and Payment Terms
Annual SpryWallet Subscription Fee is in United States Dollars. The Annual SpryWallet Subscription Fee for the initial year will be invoiced upon contract execution. Thereafter, Client’s annual SpryWallet Subscription Fee will be invoiced annually 30 days in advance of the anniversary of the Effective Date for the duration of Client’s subscription. All invoices are due net 30 days from the date of the invoice.
Implementation and Professional Services fees, if applicable, will be invoiced per the applicable SOW, change order, or as otherwise mutually agreed and are not reflected herein.
4. SpryPoint SpryWallet Subscription Fee
Initial Annual
SpryWallet
Subscription Fee
$0.00
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Version: 05202025 SpryWallet Order Form Page 2 of 14
5. Fees and Special Terms
5.1 Payrix Sub Merchant Agreement
For the avoidance of doubt, “SpryWallet” means the payment processing services provided by Payrix Solutions, LLC and its successors and assigns (“Payrix”). Client’s use of SpryWallet shall be subject to the additional terms and conditions, a binding separate agreement between Payrix and Client, set forth as “Attachment A” to this SpryWallet Order Form (Payrix Sub Merchant Agreement). For clarity, by signing this SpryWallet Order Form, Client is correspondingly agreeing to the terms of the Payrix Sub Merchant Agreement.
5.2 SpryWallet Transaction Fees
SpryWallet Transaction fees related to the payment processing services, as outlined below, are separate from and in addition to the Annual SpryWallet Subscription Fee.
5.3 NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS ORDER FORM OR
THE AGREEMENT, (A) ANY SPRYPOINT INDEMNIFICATION OBLIGATIONS SET OUT IN THE AGREEMENT WILL NOT APPLY TO SPRYWALLET; (B) SPRYPOINT
MAKES NO WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, WITH RESPECT TO SPRYWALLET; AND (C) IN NO
EVENT WILL SPRYPOINT HAVE ANY LIABILITY, WHETHER IN CONTRACT, TORT,
NEGLIGENCE OR OTHERWISE, FOR ANY DIRECT, INDIRECT, SPECIAL,
INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES, HOWEVER CAUSED,
ARISING OUT OF, OR IN ANY WAY CONNECTED WITH SPRYWALLET EVEN IF
CLIENT HAS BEEN PREVIOUSLY ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. CLIENT ACKNOWLEDGES AND AGREES THAT ITS EXCLUSIVE
RECOURSE AND REMEDIES IN RESPECT OF SPRYWALLET WILL BE TO PAYRIX
IN ACCORDANCE WITH ITS AGREEMENT TO THE PAYRIX SUB MERCHANT AGREEMENT ATTACHED HERETO.
5.4 By signing below, you acknowledge receipt of the Payrix Sub-Merchant Terms and Conditions along with the Direct Agreement and Bank Disclosures and that the signer has read and understands all of the terms and conditions provided in the above listed documents.
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6. SpryWallet Transaction Fee(s) Table*
All amounts reflected are in $USD.
Type Description Pricing Basis
Price to
Client
Debit/Credit Card Payment (US)** Per Transaction Utility $0.44 Payment
Processing
Fees
eCheck Payment Per Transaction $0.52
Misc AR
Payment
Processing
Fees
Debit/Credit Card Payment (US)** Per Transaction 2.40%
eCheck Payment Per Transaction 2.40%
eCheck Refund Per Transaction $0.07
eCheck Return Per Transaction $17.00
eCheck Notification of Change Per Transaction $5.00
eCheck Verification Per Transaction $3.00
Auth Reversal Fee Per Transaction $0.07
Other
Processing
Fees
Chargeback Request or Return
Processed Per Transaction $18.00
Retrieval Request Processed Per Transaction $18.00
ACH Representment Processed Per Transaction $18.00
Chargebacks
and Related
Fees
Arbitration Case Per Transaction $35.00
Per Failure & NOC Funding Fee Per Transaction $5.00
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Type Description Pricing Basis
Price to
Client
Per Instruction Funding Fee (Next
Day Funding) (Cards) Per Day $1.50
Dynamic
Payout Fees Per Instruction Funding Fee (Next
Day Funding) (eCheck) Per Day $1.50
*Client acknowledges that SpryWallet Transactions Fees may be modified after the Initial Term upon not less than 120 days’ prior notice to Client. SpryWallet Transactions Fees are based on representations made by Client to SpryPoint regarding, for example, the category code, counts, average transaction size, and other similar metrics related to payment processing activities. ** Client acknowledges that SpryWallet Transaction Fees reflected above are provided on the basis of “interchange plus” meaning Client will be responsible for all interchange fees charged between banks for processing credit and debit card payments and assessments levied by the credit card companies. Such fees are not reflected in the SpryWallet Transaction Fees.
Client Name SpryPoint Services, Inc.
Signature: Signature:
Name: Name: Nick Stone
Title: Title: Chief Financial Officer
Date Signed: Date Signed:
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Attachment A
PAYRIX SUB-MERCHANT AGREEMENT
TERMS AND CONDITIONS
Version: 04.2024
These terms and conditions are part of the binding Agreement between Payrix and Sub-Merchant. Capitalized terms used in this Agreement not otherwise defined herein are defined in the Glossary set forth below in these terms and conditions. Payrix and Sub-Merchant hereby agree as follows:
1. Payrix Services. The Payrix Services are a cloud-based payment system by which Payrix, Bank and Processor serve as a processing channel with respect to Card Transactions for Sub-Merchant to receive payments on its behalf, and Payrix serves as a Third Party Sender with respect to ACH Transactions originated by a SubMerchant, pursuant to the terms hereof and the selections of the Sub-Merchant made through its Account. Payrix shall facilitate the processing of Sub-Merchant’s Card Transactions that are originated in accordance with the Payment Network Rules, as provided herein and otherwise as Payrix, in its sole discretion, deems appropriate. As a Third Party Sender, Payrix shall transmit Sub-Merchant’s ACH Transaction debit and credit entries that are originated by Sub-Merchant in accordance with the NACHA Rules by such means as Payrix, in its sole discretion, deems appropriate. The Payrix Services additionally include the services set forth in Addendum A – General Services Addendum.
2. Account. So long as Sub-Merchant is not in breach of this Agreement, Sub-Merchant shall be granted an Account accessible through the Payrix Services. The Account shall include a record of Sub-Merchant Transactions and Fees. Payrix shall provide Sub-Merchant with credentials for access to the Account. Sub-Merchant may not disclose such codes or permit any third party to use them other than Third Party Servicers pursuant to a binding written agreement with Sub-Merchant. SubMerchant assumes full responsibility for the use of its Account and the access credentials thereto and shall indemnify Payrix for any and all claims, losses or other liabilities arising therefrom. Except as required to deliver or receive the Payrix Services or as otherwise required by law, Payrix shall not grant any third party access to the Account. Payrix may debit or credit the Sub-Merchant’s bank account(s) associated with its Account in connection with its activities under this Agreement, and may perform such debits and/or credits through a third party designated by Payrix who is a licensed money transmitter.
3. Prohibited Merchants. All of the following Persons are prohibited from using the Payrix Services: (i) Persons who appear on the U.S. Department of the Treasury, Office of Foreign Assets Control, Specially Designated Nationals List; (ii) Persons who are less than 18 years of age; (iii) Persons, or their Affiliates who have been previously terminated for cause by Payrix or any of its Affiliates; and (iv) Persons who are not both domiciled and resident in the United States.
4. Prohibited Activities. It is forbidden for a Sub-Merchant to use Payrix Services to assist in any illegal activity or any Prohibited Activity. Likewise, Sub-Merchant may not use Payrix Services in or for the benefit of a country, organization, entity, or person embargoed or blocked by any government, including those on sanctions lists identified by the United States Office of Foreign Asset Control. Without any limitations on any other Prohibited Activity, Sub-Merchant hereby affirms that no payments whatsoever for firearms or ammunition or any parts or accessories that could modify the performance or action of any actual firearms (e.g., bump stocks) will be made through the Account. Payments for these items will be taken via alternate means only. Sub-Merchant may not itself or through any other Person: (i) copy, modify, adapt, translate, reverse engineer, decompile, or disassemble, in any way, any portion of the Payrix Services and/or content made accessible by Payrix including any information, pictures, videos, text, graphics, software programs used by Payrix in connection with the Payrix Services and Content, or publicly display, reproduce, create derivative works from, perform, distribute, or otherwise use such Content, other than as permitted by Payrix in writing; (ii) make any use of the Content and/or Payrix Services on any other website or networked computer environment for any purpose, or replicate or copy the Content without Payrix’s prior written consent; (iii) interfere with or violate any other services or user's right to privacy or other rights, or harvest or collect personally identifiable information about users of the Payrix Services without their express consent, including using any robot, spider, site search or retrieval application, or other manual or automatic device or process to retrieve, index, or data-mine; (iv) defame, abuse, harass, stalk, threaten, or otherwise violate the legal rights of others; (v) transmit or otherwise make available in connection with the Payrix Services any virus, worm, trojan horse, time bomb, web bug, spyware, or any other computer code, file, or program that may or is intended to damage or hijack the operation of any hardware, software, or telecommunications equipment, or any other actually or potentially harmful, disruptive, or invasive code or component; (vi) interfere with or disrupt the operation of the Payrix Services, or the servers or networks that host the Payrix Services or make them available, or violate any requirements, procedures, policies, or regulations of such servers or networks; (vii) sell, license, or exploit for any commercial purposes any use of or access to the Payrix Services other than permitted by Payrix; (viii) forward any data generated from the Payrix Services without the prior written consent of Payrix; (ix) sublicense any or all of the Payrix Services to any third party; or (x) transfer or assign the Account password, even temporarily, to a third party.
5. Application. On sign-up and throughout the term of this Agreement, Sub-Merchant shall supply, through the Application and by such other means as Payrix may require, information concerning the Sub-Merchant, its Guarantor (if required by Payrix) and principals. Sub-Merchant shall notify Payrix of any changes in such information. Federal Regulations enacted pursuant to the USA Patriot Act and other applicable laws require financial institutions to verify the identity of every person who seeks to open an account with a financial institution. Sub-Merchant shall provide documentary verification as requested from time to time by Payrix in a manner acceptable to Payrix. Payrix, Processor, and Bank reserve the right to verify Sub-Merchant’s identity through other non-documentary methods as deemed appropriate in their sole discretion. Payrix, Processor, and Bank may retain a copy of any document it obtains to verify Sub-Merchant’s identity. Sub-Merchant will elect on the Application to accept (full acceptance) or not accept (limited acceptance) Cards for payment. A full acceptance Sub-Merchant will accept all valid Cards unless SubMerchant provides thirty (30) days written notice to Payrix requesting limited acceptance and stating Sub-Merchant’s election of Card types. Limited acceptance is not applicable to non-US issued Cards and is in all instances subject to the Rules. Sub-Merchant will prominently display Card signage provided by Payrix in its place(s) of business and the type of signage displayed will be in accordance with the Payment Networks accepted by Sub-Merchant and if Sub-Merchant participates in full or limited acceptance.
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6. Customers. Payrix is not party to any Sub-Merchant relationship with its Customer that necessitates the Transaction and Payrix shall have no obligations thereunder or in respect thereof. Sub-Merchant is solely responsible for its Product and all customer service issues related thereto including pricing, order fulfillment, order cancellation by Sub-Merchant or the Customer, returns, refunds and adjustments, rebates, functionality and warranty, technical support and feedback concerning experiences with Sub-Merchant personnel, policies or processes. Sub-Merchant shall post its customer service telephone number on its website. Sub-Merchant shall indemnify and hold harmless Payrix, Processor, Bank and their respective shareholders, directors, officers and employees harmless from any and all claims, losses or other liabilities arising from or in relation to Sub-Merchant’s relationship with its Customer or any Product, including any and all costs associated with the legal defense related to such claims. Each Transaction submitted or processed hereunder shall represent a payment by a Customer to Sub-Merchant. Payrix and Bank make no representation or guarantee with respect to Customer funds availability, that a Transaction will be authorized or processed, or that a Transaction will not later result in a chargeback, reversal Return or Reversal. If Sub-Merchant is a non-profit organization, it shall retain sole and exclusive responsibility for classifying itself and its Transactions, issuing any required reports and receipts, and making any required tax or other filings.
7. Payrix Regulatory Status. Payrix is not a bank, money transmitter or other money services business. Payrix Services relate solely to the facilitation of Transactions between Customers and the Sub-Merchant pursuant to this Agreement. Settlement funds are not insured by Payrix, Processor, Bank or any third party. Payrix reserves the right to monitor use of the Payrix Services by Sub-Merchant and its Customers to ensure compliance with this Agreement, the Rules and applicable laws. If Payrix determines that Sub-Merchant is not in compliance with this Agreement, the Rules or applicable law, Payrix reserves the right to take appropriate action including, but not limited to suspending or terminating this Agreement or access to the Account. Bank, not Payrix, settles Card Transaction funds to Sub-Merchant, and Payrix does not settle ACH Transaction funds to Sub-Merchant. Payrix does not at any point hold, own or control funds in connection with the Payrix Services, nor does Payrix transmit money or anything of monetary value. In connection with the Payrix Services, Payrix does not actually or constructively receive, take possession of, or hold any money or anything of monetary value for transmission, and does not advertise, solicit or hold itself out as receiving money for transmission. The Bank is the party with sole responsibility for conducting the settlement of funds between Customers and Sub-Merchants.
8. Platform Services and Third Party Servicers. Payrix assists in enabling Platforms to help Sub-Merchant administer its Account with Payrix and provides services directly to Sub-Merchant or its Customers. When Sub-Merchant opens an Account through a Platform, Sub-Merchant authorizes Payrix to permit the Platform to (i) access Sub-Merchant’s Account with Payrix and any data contained in such Account; (ii) assist Sub-Merchant in creating and managing Transactions with Customers; and (iii) deduct Platform fees from funds payable to Sub-Merchant. Sub-Merchant agrees to pay all Platform fees in addition to the Fees as set forth in this Agreement.
Payrix does not assume any responsibility with regard to the connectivity between Sub-Merchant and any Platform or Third Party Servicer. It is ultimately SubMerchant’s responsibility to ensure that Sub-Merchant Transactions reach Payrix, Processor and the Bank in order to receive Payrix Services. Sub-Merchant shall not use any Third Party Servicer unless it has all necessary Payment Network registrations and is fully compliant with applicable law and the Rules, as determined by Payrix. Payrix is not liable for Third Party Servicers or their services even if the Site contains links to them or the Payrix Services are integrated with them. The inclusion of any link or integration to a Third Party Servicer does not imply an approval, endorsement, or recommendation by Payrix. Sub-Merchant agrees that Sub-Merchant accesses any such website at Sub-Merchant’s own risk.
9. Equipment/Third Party Services. The following provisions apply if Sub-Merchant elects to purchase supplies or purchase, rent, or otherwise use equipment from Payrix at any time:
(i) Equipment Terms of Use and Sale. As requested by Sub-Merchant and upon Payrix’s approval, Payrix may lease, rent, sell or otherwise provide Equipment to Sub-Merchant in connection with this Agreement. Sub-Merchant agrees that Payrix may substitute a comparably valued device making up the Equipment in the event the device Sub-Merchant selected is out of stock or otherwise not currently available to Payrix and/or if Payrix reasonably believes that the requested Equipment is not compatible with Sub-Merchant’s POS software or other equipment. Except as otherwise set forth in (ii) of this section below, Sub-Merchant acknowledges that Payrix provides the Equipment to Sub-Merchant on an 'as is' basis, with no representations or warranties. Sub-Merchant agrees to release and hold Payrix harmless from any claims relating to any breach of manufacturer’s or third party’s warranties and that Payrix is not liable to Sub-Merchant for any loss, delay, error, interruptions or damage of any kind or character, whether direct, indirect or consequential, resulting from inoperable, defective or otherwise non-working Equipment. Sub-Merchant is solely responsible for complying with the Payment Network Rules and applicable laws regarding Sub-Merchant’s use of the Equipment.
(ii) Equipment Support. Payrix agrees to provide limited technical support for installation and operation of the Equipment and to deliver to Sub-Merchant any available product warranties provided by the manufacturer of the Equipment or other third party. Payrix has no liability or responsibility for fulfilling the terms of the manufacturer or other third-party warranties, if any. Sub-Merchant’s sole recourse relating to the manufacturer or other third-party warranty shall be through the manufacturer or, as applicable, the third party. Payrix or the Platform may assist Sub-Merchant in the repair or replacement of the Equipment if necessary, as determined by Payrix or Platform, and subject to additional charges and/or required documentation. If Payrix or the Platform replaces the Equipment pursuant to the above sentence, Sub-Merchant agrees to return the original Equipment, at Sub-Merchant’s sole cost and expense, within ten (10) calendar days of SubMerchant’s receipt of the replacement Equipment. (iii) Use of the Equipment. The operating instructions will instruct Sub-Merchant in the proper use of the Equipment, and Sub-Merchant shall use and operate the Equipment only in such manner. Sub-Merchant agrees that Sub-Merchant will not acquire any title or proprietary right to any Equipment leased, rented, or otherwise provided free of charge by Payrix or Platform. Sub-Merchant will protect all such Equipment from loss, theft, damage or any legal encumbrance and will allow Payrix or Platform or other Payrix’s designated representatives reasonable access to Sub-Merchant’s premises for repair, removal, modification, installation and relocation of the Equipment. Payrix’s suppliers, including where applicable, Platform, are intended third-party beneficiaries of this Agreement to the extent any terms pertain to Payrix’s suppliers’ ownership rights. Payrix’s suppliers have the right to rely on and directly enforce the applicable terms of this Agreement against Sub-Merchant. Except for Equipment Sub-Merchant purchases, Sub-Merchant shall not permit the Equipment to be used by any other person or entity or at any address other than Sub-Merchant’s address set forth in the Sub-Merchant Application without Payrix’s express written consent. With respect to any item of Equipment Payrix or Platform provides to Sub-Merchant, Sub-Merchant will not be liable for normal wear and tear, provided, however, that Sub-Merchant will be liable to Payrix in the event that an item of Equipment is lost, destroyed, stolen or rendered inoperative. Sub-Merchant agrees that SubMerchant’s indemnification obligations under this Agreement apply to Sub-Merchant’s use of the Equipment. Any unused equipment in its original packaging purchased from Payrix hereunder may be returned to Payrix at Sub-Merchant’s expense within sixty (60) calendar days of receipt. Sub-Merchant shall receive a refund of any money paid, exclusive of shipping charges, in connection therewith subject to a re-stocking fee of an amount equal to twenty percent (20%) of the total purchase price for the returned equipment. No refunds shall be issued for any equipment returned after sixty (60) calendar days. (iv) Software. Sub-Merchant acknowledges that any Equipment provided under this Agreement is embedded with proprietary technology ("Software"). Sub-Merchant shall not obtain title, copyrights or any other proprietary right to any Software. At all times, Payrix or Payrix’s suppliers retain all rights to such Software, including but not limited to updates, enhancements and additions. Sub-Merchant shall not disclose such Software to any party, convey, copy, license, sublicense, modify, translate, reverse engineer, decompile, disassemble, tamper with, and/or create any derivative work based on such Software. Sub-Merchant’s use of such Software shall be limited to that expressly authorized by Payrix. In the event the Equipment requires additional Software, Sub-Merchant is obligated to cooperate with Payrix and Platform for the receipt and installation of such Software and/or to participate in a dial in or other down-load procedure. #7..
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(v) Fees and Discontinued Use of Equipment. Sub-Merchant agrees to pay the lease, rental, and other fees and costs set forth in the Application or any order form or amendment or addendum to the Agreement, from the date on which the Equipment is provided to Sub-Merchant and continuing thereafter as provided in this Agreement. Furthermore, for any Equipment provided to Sub-Merchant not included in the Application, order form, amendment, or addendum, Sub-Merchant agrees to pay the suggested retail price or Payrix’s standard list price for the Equipment as invoiced to Sub-Merchant by Payrix or Platform. If Payrix or Platform provides Sub-Merchant Equipment at no cost, or Sub-Merchant rents or leases Equipment from Payrix, within fourteen (14) calendar days from the earlier of: (i) the end of the lease or rental term; (ii) upon such time that Sub-Merchant discontinues transmitting Customer Transactions through the Equipment to Payrix for a period of thirty (30) calendar days; or (iii) Sub-Merchant has not submitted a transaction to Payrix within thirty (30) calendar days of the date Payrix provides Sub-Merchant the Equipment, Sub-Merchant agrees to, either: (a) return the Equipment to Payrix or Platform at Sub-Merchant’s sole cost and expense, if so instructed by Payrix; or (b) otherwise pay the equipment non-return/non-use fee of up to $999.00 per device unless expressly otherwise agreed in writing. In the event Sub-Merchant discontinues transmitting customer transactions through the Equipment to Payrix for a period of thirty (30) calendar days within the initial term of the lease or rental, Sub-Merchant agrees that the monthly lease or rental fee set forth in the Application shall apply for the remainder of such initial term which monthly lease or rental fee will be accelerated and immediately charged to Sub-Merchant.
10. Credit Check Consent; Financial Information. In connection with Sub-Merchant procuring Payrix Services from Payrix, Sub-Merchant understands that one or more consumer reports as defined in the FCRA may be obtained by Payrix from consumer reporting agencies and Sub-Merchant consents to Payrix obtaining such reports and agrees to provide Payrix with any information necessary to obtain such reports. Sub-Merchant (which term shall include its shareholders, officers and Guarantors in this consent) understands that this report may include information with respect to public record information, criminal records, motor vehicle operation history, education records, names and dates of previous employers, reason for termination of employment and work experience, and/or credit worthiness, capacity and standing, character, general reputation, personal characteristics, or mode of living, such information may be used to evaluate whether Sub-Merchant is an appropriate candidate for transacting with Payrix and this determination may be adverse to Sub-Merchant. Upon written or verbal notice at any time, Sub-Merchant agrees to furnish to Payrix its recent and/or historical financial statements and other financial information. From time to time, Payrix may request credit and other financial information concerning Sub-Merchant, its owners, Guarantors (if any) and principals, and Sub-Merchant agrees to furnish the information in a timely manner. Further, Sub-Merchant agrees to provide Payrix with prompt written notice of any adverse change in Sub-Merchant’s financial condition that includes but is not limited to: any planned or anticipated liquidation; any significant change in the nature of Sub-Merchant’s business; and any material judgment, writ, warrant of attachment, levy or adverse decision against Sub-Merchant affecting its financial condition. The information obtained will not be provided to any parties other than to designated authorized representatives of Payrix. Sub-Merchant further understands that a consumer reporting agency may not give out information about Sub-Merchant to Payrix without Sub-Merchants’ written consent. Sub-Merchant hereby authorizes Payrix now, or at any time while it is party to an agreement with Payrix or otherwise engaged by Payrix, to obtain, either directly or through an Affiliate or other third party, a consumer report on Sub-Merchant. This authorization does not include the release of SubMerchant’s medical information. A copy, fax or scan of this consent shall be considered as effective and valid as the original. Sub-Merchant understands that in the event any adverse action is taken against Sub-Merchant based in whole or in part on the consumer report, Payrix shall (i) provide notice to Sub-Merchant of the adverse action; (ii) disclose Sub-Merchant’s credit score; (iii) provide Sub-Merchant with the name, address and telephone number of the consumer reporting agency; and (iv) provide notice of Sub-Merchant's rights under the FCRA. On request, California, Minnesota and Oklahoma residents, can obtain a copy of any consumer credit report requested by Payrix. On request, New York residents can be informed if a consumer credit report has been requested on them by Payrix as well as the name of the agency providing the report. Sub-Merchant and its Guarantors have read and understand the above and authorize Payrix to perform the above investigations.
Sub-Merchant must provide accurate and complete information. If Payrix cannot verify that this information is complete and accurate, Payrix may deny Sub-Merchant use of Payrix Services, or close the Sub-Merchant Account.
11. Fees. Sub-Merchant shall pay Fees for the Payrix Services. Fees shall be paid to Payrix by offsets from Transaction fund settlements to the Sub-Merchant’s bank account(s), daily ACH Transaction billing against Sub-Merchant’s bank account(s), monthly ACH Transaction billing against Sub-Merchant’s bank account(s), or any other billing method chosen by Payrix. If there are insufficient Card Transaction funds to cover Fees, or if any ACH Transaction billing is rejected due to insufficient funds in the Sub-Merchant’s bank account(s), then Sub-Merchant shall pay the Fees immediately. Platform may also have provided disclosure to Sub-Merchant concerning Fees. In the event of any inconsistency between Fees disclosed to Sub-Merchant by Platform and those disclosed by Payrix, the higher of the two shall apply. If any fees are blank or identified as not applicable on the Application, then Payrix will assess Sub-Merchant Payrix’s standard fees for such transaction(s) or item(s). Payrix may change or add fees and/or charges upon notice to Sub-Merchant via Payrix’s Service Delivery Process, and such changes and/or additions to fees and charge shall be effective on no less than ninety (90) days’ notice. Payrix has the right to round, assess, and calculate interchange and other fees and amounts and on return, chargeback and certain other transactions retain such amounts, in accordance with Payrix’s standard operating procedures. The Payrix Service used by Payrix to provide Sub-Merchant monthly statements summarizing the transaction processing of Sub-Merchant and fees may be via Payrix’s online Sub-Merchant portal.
12. Transaction Authorizations. Sub-Merchant shall not submit Transactions hereunder unless they are submitted in the correct manner, including the Sub-Merchant being in possession of Transaction receipts and not submitting Transactions until they are complete, (i.e. the goods or services are shipped/provided) and the Transaction is in the correct currency and within the correct time limit, as applicable. Sub-Merchant may set a minimum Card Transaction amount to accept that provides access to a credit account, under the following conditions: (i) the minimum Card Transaction amount does not differentiate between card issuers; (ii) the minimum Card Transaction amount does not differentiate between Payment Networks; and (iii) the minimum Card Transaction amount does not exceed $10.00 (or any higher amount established by the Federal Reserve by regulation). Sub-Merchant may set a maximum Card Transaction amount to accept that provides access to a credit account, under the following conditions: (a) the Customer (i) is a department, agency, or instrumentality of the U.S. Government; or (ii) is a corporation owned or controlled by the U.S. Government; or (iii) is a Customer whose primary business is reflected by one of the following MCCs: (x) MCC 8220 – Colleges, Universities, Professional Schools, Junior Colleges; (y) MCC8244 – Schools, Business and Secretarial; or (z) MCC 8249 – Schools, Trade and Vocational; and (b) the maximum Card Transaction amount does not differentiate between card issuers; and (c) the maximum Card Transaction amount does not differentiate between Payment Networks. Bank shall hold, receive, disburse and settle Transaction funds on Sub-Merchant’s behalf. Subject to this Agreement, Sub-Merchant also authorizes Bank to debit or credit any payment card or other payment method Payrix accepts. Sub-Merchant authorizes Payrix Bank to initiate electronic ACH debit and credit entries to Sub-Merchant’s bank account(s) and to initiate adjustments for any Transactions credited or debited in error. Sub-Merchant agrees to be bound by the Rules, and Sub-Merchant agrees that all ACH Transactions that Sub-Merchant initiates will comply with the NACHA Rules and all applicable law. In the event of any inconsistency or conflict between any provision of this Agreement and the Rules, the Rules shall govern. Sub-Merchant’s authorization will remain in full force and effect until Sub-Merchant notifies Payrix that Sub-Merchant revokes such authorization by contacting Payrix through the Account. Sub-Merchant understands that Payrix requires a reasonable time to act on Sub-Merchant revocation.
13. Settlement. Each Account must be linked to at least one verified Sub-Merchant bank account; meaning, the Sub-Merchant bank account(s) must match the routing number and account number provided by Sub-Merchant as well as Sub-Merchant’s legal entity name or registered DBA name. The Bank will transfer funds to the SubMerchant's bank account(s) according to this Agreement. If Bank cannot transfer the funds to the Sub-Merchant's bank account(s) (due to inaccurate or obsolete bank account information entered by the Sub-Merchant, or for any other reason), Payrix may refund the funds to the Customer or escheat them as provided below. None of Bank, Payrix or the Customer will have any liability to Sub-Merchant for funds so refunded. Settlements to a bank account shall be limited or delayed based on SubMerchant’s perceived risk and history with Payrix as determined by the sole and absolute discretion of Payrix or Bank and Payrix may debit any Sub-Merchant bank #7..
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account(s) for any reason permitted in this Agreement. Unless otherwise agreed in writing by Payrix, Transaction settlement shall be by ACH to the Sub-Merchant’s bank account(s).
14. Sub-Merchant Transaction Disclosure and Privacy Policy. Sub-Merchant must not: (i) Require a Customer to complete a postcard or similar device that includes the Customer’s account number, card expiration date, signature, or any other card account data in plain view when mailed; (ii) Add any tax to Transactions, unless applicable law expressly requires that Sub-Merchant be permitted to impose a tax. Any tax amount, if allowed, must be included in the Transaction amount and not collected separately; (iii) Asses a surcharge to Transactions, except as expressly permitted by, and in full compliance with the Rules; (iv) Request or use a card account number for any purpose other than as payment for its goods or services; (v) Disburse funds in the form of travelers cheques, if the sole purpose is to allow the Customer to make a cash purchase of Products from Sub-Merchant; (vi) Disburse funds in the form of cash, unless the Sub-Merchant is dispensing funds in the form of travelers cheque, TravelMoney cards, or foreign currency. In this case, the Transaction amount is limited to the value of the travelers cheques, TravelMoney cards, or foreign currency, plus any commission or fee charged by the Sub-Merchant; (vii) disburse funds of cash unless Sub-Merchant is participating in full compliance with a program supported by a Payment Network for such cash disbursement; (viii) Enter into interchange or otherwise originate any Transaction for a Transaction that was previously charged back to the Bank and subsequently returned to the Sub-Merchant, irrespective of Customer approval; provided, that Sub-Merchant may re-originate an ACH Transaction up to two times within 180 days if the initial ACH Transaction was returned for insufficient or uncollected funds. Sub-Merchant may pursue payment from the Customer outside the Payrix Services; (ix) Accept a Visa Consumer Credit Card or Commercial Visa Product, issued by a U.S. issuer, to collect or refinance an existing debt; (x) Accept a card to collect or refinance an existing debt that has been deemed uncollectable by the merchant providing the associated goods or services; (x) Enter into interchange a Transaction that represents collection of a dishonored check; (xi) originate an ACH Transaction for a Customer if an ACH Transaction for that Customer has been returned as unauthorized, until a new Authorization is obtained from that Customer; (xii) Change any aspect of what goods or services it sells or how they are sold without prior written consent of Payrix and Bank; (xiii) Request a Card Verification Value2 (“CVV2”) for a card present transaction nor retain or store any portion of the magnetic stripe data subsequent to the authorization of a sales transaction, nor any other data prohibited by the Rules; or (xiv) Submit a transaction that does not result from an act between the Customer and the Sub-Merchant. Sub-Merchant shall post a privacy policy that complies with the Rules and applicable law to its website and shall honor the terms thereof.
15. Reserves. Where deemed necessary or appropriate by Bank or Payrix, Bank shall create a Reserve in order to protect Bank or Payrix from actual or potential liabilities hereunder. The Reserve will be in an amount determined by Payrix in its sole and absolute discretion to cover anticipated chargebacks, returns, unshipped Product and/or unfulfilled services, Reversals, Returns, or other amounts owing by Sub-Merchant hereunder, or credit risk based on Sub-Merchant processing history. The Reserve may be raised, reduced or removed at any time by Bank or Payrix. Where the Reserve is not adequately funded, Sub-Merchant shall pay all amounts requested by Payrix for the Reserve within one (1) business day of a request for such amounts and Bank and Payrix may build the Reserve by off-sets from Transaction settlements or by debiting any bank account of the Sub-Merchant by ACH. Sub-Merchant grants Payrix a security interest in and lien on any and all funds held in any Reserve, and also authorizes Payrix to make any withdrawals or debits from the Reserve, without prior notice to Sub-Merchant, to collect amounts that Sub-Merchant owes Payrix under this Agreement, including without limitation, for any Reversals or other reversals of deposits or transfers. Sub-Merchant will execute any additional documentation required for Payrix to perfect Payrix's security interest in any funds in the Reserve. This security interest survives for as long as Payrix holds funds in Reserve; however, it does not apply to any funds for which the grant of a security interest would be prohibited by law. Sub-Merchant irrevocably assigns to Payrix all rights and legal interests to any interest or other earnings that accrue or are attributable to the Reserve.
16. Customer Data Security and Compliance. If Sub-Merchant collects, stores, uses or discloses any Customer Data, Sub-Merchant shall, and shall cause its Third Party Servicers to, comply with PCI DSS and all other applicable laws and the Rules relating thereto, and shall certify such compliance when requested by Payrix.
Without limiting the foregoing, Sub-Merchant shall comply to the extent applicable with NACHA Rules requiring certain large ACH Transaction originators to render account numbers unreadable when stored at rest electronically. Sub-Merchant shall use only PCI DSS compliant Third Party Servicers in connection with the storage, processing, or transmission of Customer Data and shall be exclusively liable for any security breaches of its systems or any other PCI DSS violations or violations of other applicable laws or the Rules. Sub-Merchant has exclusive responsibility for security of Customer Data and other information on Sub-Merchant systems or those under its control. Sub-Merchant is aware of and shall comply with all applicable laws, Rules, and regulations in connection with Sub-Merchant collection, security and dissemination of any personal, financial, or transaction information. Without limitation, Sub-Merchant shall maintain policies and procedures to reduce the risk of loss from transactions that may pose significant fraud, regulatory, or legal risk, or may cause reputational damage to Payrix or any third party. Sub-Merchant shall maintain adequate security so as to prevent a breach of Customer Data. In the event of any actual or suspected breach of data in possession or control of Sub-Merchant or one of its Third Party Servicers, Sub-Merchant shall immediately notify Payrix thereof and also comply with all applicable laws and Rules concerning the breach. SubMerchant shall obtain from each Customer all consents required under the Rules and applicable law for the collection, use, storage and disclosure of any and all information provided by Customers or obtained by Sub-Merchant or its agents or Third Party Servicers under Sub-Merchant’s relationship with its Customer or otherwise for use by Payrix, Processor, Bank and all third parties as set forth in this Agreement and that assist in the delivery of the Payrix Services. Sub-Merchant shall indemnify and hold Payrix and Bank harmless from and against any liability arising on account of or in relation to the failure by Sub-Merchant to obtain consents from Customers related to their information or cards. Sub-Merchant expressly consents for Payrix, Processor, Bank and all third parties that assist in the delivery of the Payrix Services to collect, use, store and disclose Payrix information, including that provided in the Application, information concerning Customers, Transactions, and the business of the Sub-Merchant in order to supply the Payrix Services, generate reports, to reduce fraud, provide customer support, create and share aggregated and/or anonymized data concerning Sub-Merchant Customers and Customer Data, and the Payrix Services and assessing the risk associated with the Sub-Merchant. Payment Networks shall have the right to use Sub-Merchant name, address, and internet addresses and Sub-Merchant authorizes Payrix to provide any such Payment Networks with any of Sub-Merchant’s information requested by the Payment Network. Payrix reserves the right, at its sole but reasonable discretion, without prior consent of SubMerchant, to make reasonable changes to the Payrix Services or implement other risk management controls deemed necessary by Payrix or its suppliers to manage risk. Sub-Merchant shall comply with all such changes.
17. Taxes. Sub-Merchant has the exclusive responsibility to calculate, charge, collect and remit state and other taxes applicable to Product sales. Payrix may have tax reporting responsibilities in connection with the Payrix Services such as an Internal Revenue Service report on Form 1099-K.
18. Refunds and Returns. Sub-Merchant agrees to process returns of and provide refunds and adjustments for Products in accordance with this Agreement and the Rules. The Rules require that Sub-Merchant will: (i) maintain a fair return, cancellation or adjustment policy; (ii) disclose Sub-Merchant return or cancellation policy to Customers at the time of purchase; (iii) not give cash refunds to a Customer in connection with a payment card sale, unless required by law; and (iv) not accept cash or any other item of value for preparing a payment card sale refund. Sub-Merchant’s refund policies must be the same for all payment methods and should specifically include a requirement for prompt payment of refunds in order to limit chargeback risk.
19. Chargeback Liability. The amount of a Card Transaction may be charged back to Sub-Merchant for a variety of reasons under the Payment Network Rules. The amount of an ACH Transaction may be subject to Reversal for wrong dollar amount, wrong account number, duplicate transaction or other reasons under the NACHA Rules. Sub-Merchant is responsible for all chargebacks and Reversals, whether or not the chargeback or Reversal complies with the Rules. Sub-Merchant shall immediately pay Payrix the amount of all chargeback and related Fees, fines, or penalties assessed by the Bank, Processor, the Payment Networks or any other third party. If Sub-Merchant does not have sufficient funds in its bank account(s) to pay such amounts, Payrix can offset the amounts thereof from other Transaction amounts #7..
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owing to Sub-Merchant hereunder, debit the amount by ACH Transaction from the Sub-Merchant's bank account(s) or oblige Sub-Merchant to make immediate payment thereof. If Payrix determines that Sub-Merchant is incurring an excessive amount of chargebacks, Returns or Reversals, Payrix or the Bank may establish controls or conditions governing Sub-Merchant’s Account, including without limitation, by: (i) assessing additional Fees; (ii) creating a Reserve in an amount reasonably determined by Payrix; (iii) delaying payment; and (iv) terminating or suspending the Payrix Services or closing the Account. Sub-Merchant shall assist in the investigation of any and all chargebacks, Returns, Reversals and other actual or potential Transaction disputes and shall timely provide such information to Payrix as Payrix may request.
20. Recoupment of Funds Owing to Payrix. Where amounts are owing from Sub-Merchant to Payrix hereunder, Payrix shall have the right to immediately, without prior consent or notice, offset or debit such amounts from funds: (i) deposited by Sub-Merchant; (ii) due to Sub-Merchant under this Agreement; (iii) held in the Reserve; or (iv) available in Sub-Merchant bank account(s), or other payment instrument registered with the Bank. Sub-Merchant’s failure to pay in full amounts that Sub-Merchant owes Payrix on demand will be a breach of this Agreement. Sub-Merchant will be liable for Payrix costs associated with collection in addition to the amount owed, including without limitation attorneys' fees and expenses, collection agency fees, and interest at the lesser of one-and-one-half percent (1.5%) per month or the highest rate permitted by applicable law. In its discretion, Payrix may make appropriate reports to credit reporting agencies and law enforcement authorities and cooperate with them in any resulting investigation or prosecution. Sub-Merchant hereby expressly agrees that all communication in relation to delinquent Accounts will be made as permitted under this Agreement. Such communication may be made by Payrix or by anyone on its behalf, including but not limited to a third party collection agent.
21. Escheatment. If there is no activity in an Account for the period of time set forth in the applicable unclaimed property laws, and Sub-Merchant has a credit, Payrix may notify Sub-Merchant by sending an email to Sub-Merchant’s registered email address. Payrix may also notify Sub-Merchant by U.S. mail. Payrix will give SubMerchant the option of keeping the Account open, withdrawing the funds, or requesting a check. If Sub-Merchant does not respond to Payrix notice within the time period specified in the notice, Payrix may close the Account and Sub-Merchant funds may escheat in accordance with applicable law.
22. Recordkeeping. Sub-Merchant shall have exclusive responsibility for: (i) compiling and retaining permanent records of all Transactions and other data, and (ii) reconciling all Transaction information that is associated with Sub-Merchant’s Account. If Sub-Merchant believes that there is an error associated with Sub-Merchant’s Account, Sub-Merchant must notify Payrix in writing within 60 days after the suspected error occurred. Sub-Merchant’s failure to notify Payrix within such time period will result in Payrix not being responsible for investigating or effecting any requested adjustments as a result of any error. Upon five (5) business days’ notice or immediately upon the direction of a Payment Network, a Payment Network, or Payrix at the direction of a Payment Network, may conduct an on-site audit of SubMerchant, and Sub-Merchant agrees to cooperate with such audit.
23. Term and Termination. The Agreement shall become effective when it is accepted by both parties hereto and shall terminate as set forth herein. Payrix and Bank have the right to terminate this Agreement at any time for any reason or for no reason. On any termination hereof, Sub-Merchant shall immediately cease using the Payrix Services and the Account. Payrix shall have the right to delete all Account information on any termination hereof, but it also has the right to retain copies thereof for up to five (5) years. Payrix and Bank shall not have any liability to Sub-Merchant resulting from a termination hereof. This Agreement shall terminate immediately if a Payment Network requires Payrix to terminate this Agreement. Sub-Merchant may terminate this Agreement by closing Sub-Merchant's Account at any time. When Sub-Merchant closes the Account, any pending Transactions will be cancelled. Any funds that the Bank is holding in custody for Sub-Merchant at the time of closure, less any applicable Fees and other liabilities of Sub-Merchant, will be paid out to Sub-Merchant according to Sub-Merchant's payment schedule. Bank may also withhold such funds pending investigation of Sub-Merchant Transactions or potential liabilities hereunder. On any termination hereof, Sub-Merchant shall remain liable hereunder for any and all Fees or costs accrued prior to or following termination and any other amounts owed by Sub-Merchant to Payrix, Bank or a Payment Network.
24. Marks/IP. Sub-Merchant may use the trademarks and service marks of Payrix, and the Payment Networks (the “Marks”) as provided by the Rules and subject to the sole discretion and approval of Payrix. Upon termination of this Agreement, Sub-Merchant agrees that it shall no longer use the Marks or anything similar thereto.
Payrix reserves all rights not expressly granted to Sub-Merchant in this Agreement. Payrix owns the title, copyright and other worldwide intellectual property rights in the Payrix Services and all copies of the Payrix Services. This Agreement does not grant Sub-Merchant any rights to Payrix's trademarks or service marks, nor may Sub-Merchant remove, obscure, or alter any of Payrix's trademarks or service marks included in the Payrix Services. All comments and suggestions concerning the Payrix Services provided to Payrix shall be the property of Payrix and Sub-Merchant shall not have any rights therein.
25. Indemnification. Sub-Merchant shall indemnify, defend and hold Payrix, its Processor, Bank, Payment Networks and all third parties that assist in providing the Payrix Services, as well as Customers and their respective employees, directors, and agents harmless from and against any and all claims, costs, losses, damages, judgments, tax assessments, penalties, interest, and expenses (including without limitation reasonable attorneys' fees) arising out of any claim, action, audit, investigation, inquiry, or other proceeding instituted by a third party person or entity that arises out of or relates to: (i) any actual or alleged breach of Sub-Merchant representations, warranties, or obligations set forth in this Agreement, including without limitation any violation of Payrix policies or the Rules; (ii) Sub-Merchant’s wrongful or improper use of the Payrix Services; (iii) any Transaction submitted by Sub-Merchant through the Payrix Services (including without limitation the accuracy of any Product information that Sub-Merchant provides or any claim or dispute arising out of Products offered or sold by Sub-Merchant); (iv) Sub-Merchant’s violation of any third-party right, including without limitation any right of privacy, publicity rights or intellectual property rights; (v) Sub-Merchant’s violation of any applicable law; or (vi) any other party's access and/or use of the Payrix Services with Sub-Merchant’s access credentials.
26. Sub-Merchant Representations. Sub-Merchant represents to Payrix and Bank that: (i) Sub-Merchant is eligible to register and use the Payrix Services and has the authority and capacity to enter into and perform under this Agreement; (ii) the name identified by Sub-Merchant when Sub-Merchant registered is Sub-Merchant name or business name under which Sub-Merchant sells goods and services; (iii) each Transaction submitted or originated by Sub-Merchant shall represent a bona fide sale by Sub-Merchant; (iv) any Transactions submitted by Sub-Merchant will accurately describe the Product sold and delivered to a Customer; (v) each ACH Transaction originated by Sub-Merchant is in accordance with a valid Authorization that complies with all applicable NACHA Rules and that has not been revoked or terminated, the original or a copy of which is held by Sub-Merchant and can be produced upon request; (vi) Sub-Merchant shall fulfill all of Sub-Merchant’s obligations to each Customer for which Sub-Merchant submits a Transaction and will resolve any consumer dispute or complaint directly with the Customer; (vi) Sub-Merchant and all Transactions initiated by Sub-Merchant shall comply with all applicable laws and the Rules; (vii) except in the ordinary course of business, no Transaction submitted by Sub-Merchant through the Payrix Services will represent a sale to any principal, partner, proprietor, or owner of Sub-Merchant entity; and (viii) Sub-Merchant will not use the Payrix Services, directly or indirectly, for any fraudulent undertaking or in any manner so as to interfere with the use of the Payrix Services.
27. No Warranties. THE PAYRIX SERVICES ARE PROVIDED ON AN AS IS AND AS AVAILABLE BASIS. USE OF THE PAYRIX SERVICES IS AT SUB-MERCHANT’S OWN RISK. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE PAYRIX SERVICES ARE PROVIDED WITHOUT WARRANTIES OF ANY KIND,
WHETHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT.
28. Limitation of Liability. PAYRIX, ITS PROCESSOR AND BANK SHALL NOT BE LIABLE FOR SPECIAL, INCIDENTAL, INDIRECT, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING BUT NOT LIMITED TO, LOSS OF SALES, GOODWILL, PROFITS OR REVENUES. PAYRIX’S, ITS #7..
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PROCESSOR’S AND BANK’S LIABILITY UNDER THIS AGREEMENT FOR ANY CLAIM SHALL NOT EXCEED $10,000. PAYRIX, ITS PROCESSOR AND BANK SHALL NOT BE LIABLE FOR ANY DAMAGES CAUSED DIRECTLY OR INDIRECTLY BY: (I) AN ACT OR OMISSION OF SUB-MERCHANT OR ITS AFFILIATES OR ANY CUSTOMER; (II) SUB-MERCHANT USE OF OR SUB-MERCHANT INABILITY TO USE THE PAYRIX SERVICES; (III) DELAYS OR DISRUPTIONS IN THE PAYRIX SERVICES, (IV) VIRUSES OR OTHER MALICIOUS SOFTWARE OBTAINED BY ACCESSING THE PAYRIX SERVICES; (V) BUGS, ERRORS, OR INACCURACIES OF ANY KIND IN THE PAYRIX SERVICES; (VI) ACT OR OMISSIONS OF THIRD PARTIES; (VII) A SUSPENSION OR OTHER ACTION TAKEN IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT WITH RESPECT TO SUB-MERCHANT ACCOUNTS; (VIII) PAYRIX'S NEED TO MODIFY PRACTICES, CONTENT, OR BEHAVIOR, OR SUB-MERCHANT’S DIMINISHED ABILITY TO DO BUSINESS AS A RESULT OF CHANGES TO THIS AGREEMENT OR PAYRIX’S POLICIES OR PAYRIX SERVICES MADE IN ACCORDANCE WITH THIS AGREEMENT OR APPLICABLE LAW; (IX) BREACHES BY SUBMERCHANT OF THIS AGREEMENT; (X) INCORRECT OR INCOMPLETE TRANSACTION INFORMATION; (XI) ACTS OR OMISSIONS OF THIRD PARTY SERVICERS, INCLUDING BUT NOT LIMITED TO THE PLATFORM; OR (XII) BANK, PAYRIX OR ONE OF PAYRIX’S SUPPLIERS ELECTING TO SUSPEND PROVIDING PAYRIX SERVICES IN RESPECT OF SUB-MERCHANT OR A CUSTOMER ON THE BASIS OF ITS LEGAL, COMPLIANCE, OR RISK POLICIES.
29. Direct Merchant Status. Certain Payment Networks may require that Sub-Merchant enter into a direct contractual relationship with the Bank if certain criteria are met. These criteria are met if the Sub-Merchant processes more than $1,000,000 in payment transactions through Visa or MasterCard in a twelve-month period. If this happens, Sub-Merchant will immediately become bound by Processor’s then current direct merchant agreement, the current version of which is set forth at https://portal.payrix.com/terms, (the “Direct Merchant Agreement”) whereby in such Direct Merchant Agreement, Sub-Merchant may be referred to as Merchant and be party to the Direct Merchant Agreement along with the Processor and the Member Bank(s) listed in the Direct Merchant Agreement. If Sub-Merchant becomes bound by the Direct Merchant Agreement, the Member Bank providing Transaction settlement funds into Sub-Merchant’s bank account(s) will be the acquirer with regard to those Transactions. Full contact information for each Member Bank is set out in the Direct Merchant Agreement. Additionally, in the event Sub-Merchant is participating in certain business categories and has Charge Volume in excess of (1) $1,000,000 in a rolling twelve month period, or (2) $100,000 in any three consecutive months (“High CV Merchant”), American Express may convert Sub-Merchant to a direct Card acceptance relationship. Upon conversion, Sub-Merchant will be bound by American Express’ then-current Card Acceptance Agreement and corresponding pricing and fees. Sub-Merchant shall comply with the Rules, including those posted at the following sites and are incorporated herein by reference: usa.visa.com, www.mastercard.com, www.americanexpress.com and www.discover.com. In the event of any inconsistency or conflict between any provision of this Agreement and the Rules, the Rules shall govern. Sub-Merchant agrees to comply with the specific requirements set forth in the American Express Program requirements set forth below in these terms and conditions, regardless of the amount of American Express charge volume.
30. Sub-Merchant Obligations with Respect to ACH Transactions. Sub-Merchant shall be primarily liable to Payrix for any credit entries originated and for any debit entries returned or reversed. In addition to its other obligations hereunder with respect to Transactions, Sub-Merchant agrees as follows with respect to ACH Transactions:
(i) Sub-Merchant shall prepare and submit all electronic entries to Payrix in accordance with the terms, conditions and specifications set forth herein and as Payrix may specify from time to time. Sub-Merchant shall not cancel or amend any entry after its submission to Payrix other than as permitted by Payrix in Payrix’s sole discretion.
(ii) Sub-Merchant shall comply at all times with all data security rules promulgated by NACHA. Without limiting the foregoing, Sub-Merchant shall transmit all entries via a secured electronic network or via a commercially reasonable security technology acceptable to Payrix and compliant with the NACHA Rules. Sub-Merchant shall (a) establish, maintain and update commercially reasonable security measures to maintain the confidentiality of Customers’ account numbers, routing numbers, non-public personally identifiable information, and sales information and (b) maintain processes and procedures to protect against unauthorized transactions and network infections and to verify the identity of routing numbers and receivers. (iii) Sub-Merchant shall ensure the correctness, both as to content and form, of all entries and information submitted to Payrix. If any information is not readable, out of balance, or un-processable, Sub-Merchant shall correct and resubmit the information to Payrix. Payrix is not responsible for detecting any errors in the transmission or content of any entries, including duplicate entries. Payrix may reject any entry submitted by Sub-Merchant. In the event that an entry is rejected for any reason, Sub-Merchant shall remake such entry.
(iv) Sub-Merchant shall not originate an ACH Transaction with respect to any Customer until Sub-Merchant has obtained from such Customer an authorization (an “Authorization”), as required by the NACHA Rules and reasonably acceptable to Payrix, to make prearranged debits from the Customer’s bank account(s). Such Authorization may be in the form of either (a) a signed written agreement from the Customer, with a copy thereof given to the Customer, or (b) an electronic record compliant with the requirements of the Electronic Signatures in Global and National Commerce Act (E-Sign) and legally binding in the same manner as are hard copy documents executed by hand signatures, with the electronic record capable of retention by print or otherwise. Sub-Merchant shall retain the original or a copy of the Authorization as prescribed in the NACHA Rules and, upon Payrix’s request, shall promptly furnish to Payrix an original or a copy of the Authorization. Should Sub-Merchant wish to change the amount or date of billing of an ACH Transaction in respect of any Customer, it shall first obtain a new Authorization.
(v) Sub-Merchant shall at all times comply with the NACHA Rules with respect to each ACH Transaction and agrees to assume the responsibilities, of an “Originator” under the NACHA Rules. Without limiting the foregoing, Sub-Merchant shall comply with NACHA Rules that require all merchants who accept ACH to have “commercially reasonable” processes in place that validate routing numbers and verify that its Customer’s bank account is in good standing. In the event that the operating rules of a local or regional clearing house, or the arrangements between Payrix and a depository institution, are more restrictive than the NACHA Rules, Sub-Merchant shall comply with such rules.
(vi) Sub-Merchant shall not originate any entries that violate the laws of the United States. Without limiting the foregoing, Sub-Merchant shall confirm, with respect to each Customer, that U.S. companies are not restricted from doing business with such Customer under rules and regulations of OFAC; and Sub-Merchant shall not originate any Transactions for Customers with respect to which U.S. companies are so restricted.
31. Confidentiality. Unless otherwise required by law, Sub-Merchant shall, and shall cause its Affiliates to, hold in strict confidence at all times following the date hereof all Payrix, Bank and Processor Confidential Information, and neither Sub-Merchant nor any of its Affiliates shall use such Confidential Information for any purpose other than for the performance of Sub-Merchant’s duties and obligations hereunder. If Sub-Merchant breaches, or threatens to breach, any of the provisions of this section, in addition to any other rights Payrix may have, including a claim for damages, Payrix shall have the right to have the provisions of this section specifically enforced, and Sub-Merchant’s breach or threatened breach enjoined, by any court of competent jurisdiction, without presentment of a bond (such requirement being expressly waived by Sub-Merchant), it being agreed that any breach or threatened breach of this section would cause irreparable harm to Payrix in that money damages would not provide an adequate remedy.
32. Arbitration. Payrix and Sub-Merchant shall settle all disputes relating in any way to this Agreement or arising from or in respect of this Agreement exclusively by binding arbitration with a single arbitrator administered by the American Arbitration Association (www.adr.org) according to this provision and the applicable arbitration rules. The arbitrator's award shall be binding on the parties and may be entered as a judgment in any court of competent jurisdiction. Arbitration shall take place in Dallas County, Texas before a single arbitrator who is a lawyer practicing commercial law. ANY ARBITRATION UNDER THIS AGREEMENT WILL BE ONLY BE ON AN INDIVIDUAL BASIS; CLASS ARBITRATIONS, CLASS ACTIONS, PRIVATE ATTORNEY GENERAL ACTIONS, AND CONSOLIDATION WITH OTHER ARBITRATIONS ARE NOT PERMITTED, AND SUB-MERCHANT IS HEREBY WAIVING SUB-MERCHANT’S RIGHTS TO HAVE ANY CLAIMS ARISING #7..
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HEREUNDER DECIDED BY A JURY AND TO PARTICIPATE IN A CLASS ACTION AGAINST PAYRIX. In the event that Sub-Merchant or Payrix are not able to resolve a Dispute with American Express, or a claim against Payrix or any other entity that American Express has a right to join, the American Express Program requirements set forth below in these terms and conditions will apply.
33. Governing Law. The validity, construction and performance of this Agreement shall be governed and construed in accordance with the laws of Texas applicable to contracts made and to be wholly performed within such state, without giving effect to any conflict of laws provisions thereof. The Federal and state courts located in Dallas County, Texas shall have sole and exclusive jurisdiction over any disputes arising under the terms of this Agreement.
34. Limitation on Time to Initiate a Dispute. Unless otherwise required by law, an action or proceeding by Sub-Merchant relating to any dispute or claim by SubMerchant hereunder must commence within one year after the cause of action accrues failing which Sub-Merchant foregoes any rights in respect thereof.
35. Amendment of Agreement. Payrix reserves the right to modify the Payrix Services or change or add to the terms of this Agreement or any exhibit, attachment or document linked hereto at any time with electronic notice to Sub-Merchant through the Account, or by such other means as it may select, in a manner and at such time as Payrix deems reasonable. Such changes and additions may be to any of the terms hereof, including but not limited to Fees. If Sub-Merchant continues to process Transactions after actual or constructive notice of change(s) and/or addition(s) by Payrix, Sub-Merchant will be deemed to have accepted the change(s) and/or addition(s). This Agreement may also be amended by written agreement between the parties hereto.
36. Independent Contractors. The relationships of the parties to this Agreement shall be solely that of independent contractors, and nothing contained in this Agreement shall be construed otherwise. Nothing in this Agreement or in the business or dealings between the parties shall be construed to make them joint ventures or partners with each other. Neither party shall do anything to suggest to third parties that the relationship between the parties is anything other than that of independent contractors.
Sub-Merchant is responsible for ensuring compliance of its employees and agents with the terms of this Agreement. Further, Sub-Merchant is responsible for the actions of its employees and agents.
37. Guaranty. If an individual executes this Agreement on behalf of Sub-Merchant as a guarantor following a request by Payrix, then such individual personally guarantees performance by the Sub-Merchant hereunder, shall be deemed to be a Guarantor for all purposes, and shall be joint and severally liable with Sub-Merchant for all liabilities of the Sub-Merchant hereunder.
38. Assignment. The Sub-Merchant may not assign or otherwise transfer any or all of its rights or obligations under this Agreement without Payrix's prior written consent, and any assignment without such prior written consent will be null and void. Payrix and Bank may assign any of its rights or obligations hereunder to a third party on electronic notice to Sub-Merchant through the Account.
39. Electronic Signatures, Notices and Electronic Communication. When provided to Sub-Merchant for execution in electronic form, this Agreement and all related electronic documents, shall be governed by the provisions of the Electronic Signatures in Global and National Commerce Act. By pressing Submit, Accept or I Agree, Sub-Merchant agrees (i) that the Agreement and related documents shall be effective by electronic means, (ii) to be bound by the terms and conditions of this Agreement and related documents, (iii) that Sub-Merchant has the ability to print or otherwise store the Agreement and related documents, and (iv) to authorize Payrix to conduct an investigation of Sub-Merchant’s credit history and that of its principals with various credit reporting and credit bureau agencies for the sole purpose of determining acceptance of this Agreement and ongoing performance hereunder as described in Sections 5 and 10 of these terms and conditions to the Agreement.
Sub-Merchant agrees to receive all communication under this Agreement by electronic means (which may also be by phone and may be made by Payrix or by anyone on its behalf), including but not limited to communications regarding agreements and policies, such as this Agreement and Payrix's privacy policy. Sub-Merchant shall make sure that its primary email address is up to date in the Account and it shall check that email periodically and not less than once per week. In the event that any email from Payrix or other communication is blocked by a spam filter or other issue outside of the control of Payrix, Sub-Merchant shall be deemed to have received the communication all the same. All notices and other communications required or permitted hereunder to be given to a party to this Agreement shall be in writing and shall be sent by electronic mail to the following addresses, if to Payrix, [email protected], and if to Sub-Merchant, to the e-mail address indicated on the Account.
Any notice sent in accordance with this section shall be effective upon transmission and electronic confirmation of receipt, or if transmitted and received on a nonbusiness day, on the first business day following transmission and electronic confirmation of receipt. Any notice of default of Payrix sent to Payrix shall also be sent by courier to the address of Payrix appearing on the Site with proof of delivery.
40. Whole Agreement; No Waiver; Severability. No failure, delay of forbearance of either party in exercising any power or right hereunder will in any way restrict or diminish such party's rights and powers under this Agreement or operate as a waiver of any breach or nonperformance by either party of any terms of conditions hereof. In the event that any provision of this Agreement is held invalid or unenforceable in any circumstances by a court of competent jurisdiction, the remainder of this Agreement shall not be affected thereby, and the unenforceable provision shall be enforced to the maximum extent permissible under law. Furthermore, if SubMerchant is a governmental entity, its obligations under this Agreement are subject to the limits or restrictions that may be provided in applicable state and local rules or laws. Nothing in this Agreement shall be construed or be deemed to create any rights or remedies in or for the benefit of any third party.
41. Survival. Any provision that is reasonably necessary to accomplish or enforce the purpose of this Agreement shall survive and remain in effect in accordance with its terms upon the termination of this Agreement. For greater certainty but without limitation, the indemnification, limitation of liability and confidentiality clauses shall survive termination hereof.
42. Special Association Considerations. There are a few special rules regarding your participation in the Discover and American Express Card programs.
A. Discover. Payrix has no liability for not processing or settling a retained Discover merchant’s Discover Cards (as defined by Discover).
B. American Express. The following terms apply only to Sub-Merchant’s American Express Program (see the American Express Merchant Operating Guide, which can be located at http://www.americanexpress.com/merchantopguide for capitalized terms). i. Exchange of Information. Sub-Merchant authorizes Payrix to exchange transaction and settlement information with American Express on Sub-Merchant’s behalf.
ii. American Express Program Terms. Sub-Merchant agrees to comply with the American Express Program terms provided in the Rules Summary, and the American Express Merchant Operating Guide, which can be located at http://www.americanexpress.com/merchantopguide. iii. Disclosure and Use of Information. Payrix may disclose Transaction Data, Sub-Merchant Data, and other information about Sub-Merchant to American Express. American Express may use the disclosed information for any lawful business purpose. iv. Direct Card Acceptance. In the event Sub-Merchant Charge Volume exceeds (1) $1,000,000 in a rolling twelve month period, or (2) $100,000 in any three consecutive months (“High CV Merchant”), American Express may convert Sub-Merchant to a direct Card acceptance relationship. Upon conversion, SubMerchant will be bound by American Express’ then-current Card Acceptance Agreement and corresponding pricing and fees. #7..
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v. Bona Fide Sales, Encumbrances, Assignment. Sub-Merchant shall only sell bona fide goods and services at its establishment(s). Sub-Merchant Card transactions shall be free of liens, claims, and encumbrances, other than ordinary Card tax. Additionally, Sub-Merchant shall not assign any payments it is due under the Agreement to a third party. However, Sub-Merchant may sell and assign future transaction receivables to Payrix or Payrix’s affiliated entities and/or any other cash advance funding source Payrix (or its affiliates) partner with. vi. Third Party Beneficiary. This Agreement confers third party beneficiary rights in American Express for enforcing terms against Sub-Merchant. It imposes no obligations on American Express.
vii. Opting Out. Sub-Merchant may opt out of accepting American Express Cards in writing without affecting Sub-Merchant’s rights to accept other payment products.
viii. Termination. Payrix may terminate Sub-Merchant’s right to accept American Express Cards if: (i) Sub-Merchant breaches the Agreement; (ii) American Express instructs Payrix to do so; or (iii) Sub-Merchant engages in fraudulent or any other activity justifying termination. ix. Right to Bill and Collect Chargebacks. Sub-Merchant may not bill or collect from any American Express cardholder for any purchase or payment on the Card unless chargeback has been exercised, Sub-Merchant has fully paid for the charge, and Sub-Merchant otherwise has the right to do so. x. Removal of Licensed Marks. Sub-Merchant agrees to remove any American Express Licensed Marks from its website or any other location when its participation in the Program ends.
xi. Refund Policies. Sub-Merchant agrees that its refund policies for purchases on the Card must be at least as favorable as its refund policy for purchase on any other payment product and the refund policy be disclosed to Card Members at the time of purchase and in compliance with applicable laws. xii. Participation under American Express Program or EA Program. If Sub-Merchant does not participate in the American Express Program or EA Program, Payrix will have no liability for not processing or settling Sub-Merchant’s American Express transactions. Further, American Express cards will not be included in the definition of Cards.
43. Glossary.
"ACH" means the Automated Clearing House.
“ACH Transaction” means any ACH transaction originated by or on behalf of Sub-Merchant, conducted pursuant to the NACHA Rules and utilizing Payrix Services. "Account" means a unique and private account (sometimes generally known as a merchant account or MID) provided by Payrix to Sub-Merchant accessible through the Payrix Services and in all instances subject to the terms and conditions of the Agreement. "Affiliate" means, with respect to any party, any corporation, company, partnership or other entity which is directly or indirectly controlled by such party or is directly or indirectly controlled by a person or entity that is the same as that which controls the party. For the purposes of this definition, control shall mean ownership of half or more of the voting interests in an entity.
“Agreement” means this Payrix Sub-Merchant Agreement between Payrix and Sub-Merchant, as the same may hereafter be amended, concerning the delivery and receipt of Payrix Services.
"American Express" means American Express Travel Related Services Company Inc. "Application" or “Sign-Up Form” means an electronic or paper form completed with input from the Sub-Merchant in relation to entering into the Agreement and procuring the Payrix Services and which includes a Fee Schedule setting forth the Fees, which shall form a part of the Agreement and constitutes representations by the Sub-Merchant hereunder.
"Bank" means a member of a Payment Network that has sponsored Payrix as a payment services provider, payment facilitator or otherwise to supply the Payrix Services and that acquires Transaction funds through Payment Networks. “Card Transaction” means any transaction, other than an ACH Transaction, originated by or on behalf of Sub-Merchant, that is processed through a Payment Network and conducted utilizing Payrix Services.
“Confidential Information” means all non-public, proprietary data or information of any party hereto which is valuable to the operation of such party's business and is treated by such party as confidential. Confidential Information of a party MAY NOT include the identity of any vendor, client, customer, supplier or business contact of the other party, the fact that the other party has, or is trying to enter into, a business relationship with such third party, or the nature of the business relationship with such third party.
“Content” means any material and/or data obtained by Sub-Merchant from or through the Payrix Services. “Customer” means a client, customer or donor of Sub-Merchant. "Customer Data" means information associated with a payment card, such as account number, expiration date, track-2 data, and CVV2; information associated with a Customer’s bank account(s), including, without limitation, account numbers and bank routing numbers; and other information associated with a Customer’s Transactions.
“Discover” means Discover Financial Services, Inc.
“FCRA” means the Federal Fair Credit Reporting Act as amended (FCRA), 15 U.S.C. 1681 and following. "Equipment" means equipment provided to Sub-Merchant by Payrix or its suppliers, including Platform, and includes imprinters, authorization terminals and other similar devices, printers, software, and credit card authenticators. "Fees" means the fees of Payrix for which Sub-Merchant is liable in exchange for the Payrix Services, including, but not limited to, any rental, purchase, or license of terminals, equipment, software, supplies, or other services or products provided by Payrix. Fees are set out in the Application. Fees may be amended in accordance with this Agreement. Fees may also change, in accordance with this Agreement, if Payment Networks or other third parties impose additional fees on Payrix for the supply of the Payrix Services or on amendments to applicable law that require Payrix to amend the Fees. "Guarantor" means any Person guaranteeing the Payrix obligations, either as indicated on the Application or otherwise. "Mastercard" means Mastercard International Incorporated.\ “NACHA” means the National Automated Clearinghouse Association. “NACHA Rules” means operating rules and guidelines promulgated by NACHA and governing ACH Transactions or the related activities of parties involved in ACH Transactions, as amended or modified from time to time. "Payment Network" means Visa, Mastercard, Discover, American Express, NACHA and such other payment networks as Payrix indicates are compatible with the Payrix Services.
“Payment Network Rules” means, collectively, the by-laws, operating regulations and/or all other rules, policies and procedures, including but not limited to the PCI DSS, the VISA Cardholder Information Security Program, the Mastercard Site Data Protection Program, and any other program or requirement that may be published and/or mandated by any Payment Network or other private or public association or organization, applicable to the Payrix Services and Card Transactions or the related activities of parties involved in Card Transactions, as amended or modified from time to time. Payment Network Rules do not include the NACHA Rules. “Payrix” means Payrix Solutions, LLC and its successors and assigns. "Payrix Services" means the payment processing services of Payrix and its processor and acquiring bank, the Site, any software, programs, services, documentation, tools, hardware, internet-based services, and components thereto provided directly or indirectly to Sub-Merchant by Payrix. “PCI DSS” means the Payment Card Industry Data Security Standards, as they may be amended or modified from time to time. "Penalties" means any and all fines, charges, penalties, assessments, late submission charges and all other costs, expenses and indebtedness levied by a Payment Network, card issuer, NACHA, other regulatory authority or other third party that are assessed against, likely to be assessed against, charged to, likely to be charged #7..
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to, incurred by (directly or indirectly) or otherwise paid by, Payrix to the extent attributable to, arising out of, or related to Sub-Merchant’s (i) Transactions or business, or (ii) breach or alleged breach of any provision in this Agreement. "Person" is to be broadly interpreted and includes an individual, a corporation, a partnership, a trust, an unincorporated organization, the government of a country or any political subdivision thereof, or any agency or department of any such government, and the executors, administrators or other legal representatives of an individual in such capacity.
“Platform” means any third-party utilized by Payrix to administer and service the Account of Sub-Merchant. “Platform Fees” are those fees occurring in connection with Sub-Merchant’s use of a Platform. "Processor" means a payment processor that has contracted with Payrix to assist Payrix in delivering the Payrix Services. Payrix currently uses two processors: FIS with an address of 8500 Governors Hill Drive, Mail Drop 1GH1Y1, Symmes Township, OH 45249-1384 and Wells Fargo Merchant Services with an address of PO Box 6079, Concord, CA 94524.
"Product" means any product or service offered for sale or sold by Sub-Merchant. "Prohibited Activity" means any activity deemed to be prohibited by Payrix, the Processor or the Bank, as communicated to Sub-Merchant from time to time. For the current list of Prohibited Activities, see attached Prohibited Activity Schedule. “Reserve” means a reserve account established and maintained to protect by Bank or Payrix from actual or potential liabilities under the Agreement. “Return” means the return of an ACH Transaction entry, unpaid, for various reasons including non-sufficient funds, uncollected funds, stop payment, account closed, or unauthorized.
“Reversal” means the reversal of an erroneous ACH Transaction entry for various reasons including incorrect account number or type, incorrect amount, or duplicate transaction.
"Rules" means the Payment Network Rules and the NACHA Rules. “Service Delivery Process” means Payrix’s then standard methods of communication, service and support, including but not limited to communication via an online Sub-Merchant portal, email communication, statement notices, other written communications, etc. "Site" means www.payrix.com.
“Sub-Merchant” means the Person accepting the Agreement and receiving Payrix Services thereunder. “Third Party Sender” has the meaning assigned to such term in the NACHA Rules and includes a third party service provider that acts as an intermediary in transmitting ACH Transaction entries between an originator (in this case, Sub-Merchant) and a financial institution, acting on behalf of the originator. "Third Party Servicer" means a third party that provides a product or service that Sub-Merchant wishes to procure which product or service may or may not be compatible or integrated with the Payrix Services.
"Transaction" means an ACH Transaction or a Card Transaction originated by or on behalf of Sub-Merchant conducted utilizing any of the Payrix Services. "Visa" means Visa U.S.A., Inc., Visa International.
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PROHIBITED ACTIVITY SCHEDULE
“Prohibited Activity” means: any adult content; airlines, including charter airlines; alimony, child support, or other court-ordered payments; bidding fee auctions, including penny auctions; brand or reputation damaging, potential or otherwise, including bestiality, child pornography, escort services, mail order brides, and occult; buyers’ clubs, discount clubs or membership clubs; check cashing, or payment for a dishonored check or for an item deemed uncollectible by another merchant; commodity trading or security trading; cruise lines; credit counseling or credit repair agencies; counterfeit or possibly counterfeit goods, or products that infringe on the intellectual property rights of others; debt collection, consolidation, or reduction services; deceptive, unfair, predatory products, services or activities, or prohibited by the card payment networks; digital currency; discount medical or dental plans including discount insurance; distressed property sales and marketing; door to door sales; drugs, alcohol, or drug paraphernalia, pseudo-pharmaceuticals, substances designed to mimic illegal drugs, or items that may represent them; factoring, liquidators, bailiffs, bail bondsmen; financial services or instruments, such as cash advances, bill payment, loans or loan payments, money orders, money transfers, prepaid cards, wire transfers, or sales of money orders or foreign currency; gambling or betting, including lottery tickets, casino gaming chips, off-track betting, sports forecasting or odds making, fantasy football, memberships on gambling-related internet sites and wagers at races, contests, sweepstakes, and offering prizes as an inducement to purchase goods or services; hate, violence, racial intolerance, or the financial exploitation of a crime; high interest rate non-bank consumer lending including payday lending and title loans; infomercial merchants; internet pharmacies or pharmacy referral sites; investment or “get rich quick” merchants, businesses or programs; l marijuana dispensaries and related products or services; marketing activities involving “pay only for shipping” and/or “free trial” periods; medical equipment; multi-level marketing businesses, pyramid or Ponzi schemes; merchants using negative options, , or similar continuity subscription practices; obscene or pornographic items; pawn shops; pharmaceuticals, including medical marijuana; prostitution, escort services, massage parlors, and other potentially sexually related services; real estate or motor vehicle sales; scrip-dispensing terminal; selling of mobile minutes; selling or sales of social media activity; stored value or quasi-cash; timeshares, timeshare resales and related marketing; tobacco, cigarettes, or e-cigarettes; unlawful activities or items, or activities or items that encourage, promote, facilitate or instruct others regarding the same; violent acts towards self or others, or activities or items that encourage, promote, facilitate or instruct others regarding the same; virtual currency or credits that can be monetized, re-sold or converted to physical or digital goods or services or otherwise exist in the virtual world; weapons, including replicas and collectible items, or ammunition or other accessories; weight loss programs; goods or services to be delivered more than two (2) months in the future, with an intention of gaining return on investment; and internet auctions. In addition and included as a Prohibited Activity, merchant may not use the Payrix Services for; impersonating any person or entity or falsely claiming an affiliation with any person or entity; collecting, or attempting to collect, personal information about merchants or third parties without their consent, or using such information except as necessary to use the service; sending unsolicited offers, advertisements, proposals, or junk mail or spam to others, this includes, but is not limited to, unsolicited advertising, promotional materials, or other solicitation materials, bulk mailing of commercial advertising, chain mail, informational announcements, charity requests, and petitions for signature; accepting payments for goods or services provided by someone other than merchant; providing merchant itself or others with a cash advance from a credit card; any illegal purpose, or violating any local, state, national, or international law, statute, or regulation, including, without limitation, laws governing intellectual property, taxation, and data collection and privacy; defaming, harassing, abusing, threatening, or defrauding others; posting, transmitting, or distributing content that is false, misleading, unlawful, obscene, indecent, lewd, pornographic, hateful, abusive, inflammatory, or that violates the rights of others (including rights of publicity or privacy); damaging, disabling, overburdening, or impairing Payrix, including without limitation, using the service in an automated manner; interfering with another merchant's enjoyment of the service, by any means, including by uploading or otherwise disseminating viruses, adware, spyware, worms or other malicious code; competing with Payrix or Payrix’s business partners; sending or receiving what Payrix considers to be funds for something that may have resulted from fraud or other illegal behavior; abusing the payment card system or violating the rules, in the reasonable opinion of the card payment networks or Payrix; operating outside the united states; acting as a money services business or money transmitter; transferring funds between bank accounts held in the same name; creating an account that is linked to another account that has engaged in any of the foregoing activities. Payrix may use evidence other than merchant account information to determine whether merchant controls an account in someone else's name, including but not limited to internet protocol addresses, common business names, phone numbers, and mailing addresses; or any activity deemed by Payrix to be unauthorized, illegal, or criminal. #7..
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CITY OF MODESTO
COMMITTEE AGENDA REPORT
DATE OF MEETING:
June 23, 2025
Date: May 30, 2025
TO: Finance Committee
Rosa Escutia-Braaton, Chair
David Wright, Vice-Chair
Nick Bavaro, Member
THROUGH: Joseph P. Lopez, City Manager
FROM: William Wong, Director of Utilities
SUBJECT: Upcoming Construction Project Report
River Trunk Realignment – Pump Station Project
CONTACT: Cristian Ciotau, Engineering Division Manager
[email protected], 209-571-5175
DESCRIPTION:
Consider a Report on the upcoming River Trunk Realignment – Pump Station Construction Project. (Funding Source: Wastewater Fund)
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 2007 Wastewater Collection System Master Plan (WWCSMP) identified key hydraulic and condition deficiencies in the City’s wastewater collection system; These conclusions were reevaluated as part of the 2016 WWCSMP. The River Trunk Realignment was one of the main priority projects identified in the 2016 WWCSMP and addresses deficiencies in the River Trunk, Sutter Trunks, and Beard Brook Siphon.
The River Trunk consists of a pipeline that ranges from 24-inches to 60-inches in diameter that conveys flow from the Beard Industrial Park to the City of Modesto Regional Water Recycling Facility – Sutter Campus (Sutter Campus). The total length of the River Trunk is approximately five miles and conveys approximately 24 percent of the City’s domestic wastewater flow. The Beard Brook Siphon consists of a 48-inch diameter trunk that starts at the west end of Oregon Drive, at the Gallo facility, and crosses under Beard Brook Park to Morton Boulevard. The current location of the River Trunk, adjacent to the Tuolumne River, poses access limitations to operations staff and could be subject to catastrophic damage in the event of elevated river flows. The Beard Brook Siphon also poses access limitations. As City staff evaluated these #8..
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projects, consideration was given to realigning the River Trunk away from its current location to an alternate route within the public right-of-way and replacing the Beard Brook Siphon with a gravity system. Additional consideration was given to realigning the Sutter Trunk to connect to the new River Trunk.
On April 1, 2014, by Resolution No. 2014-121, Council approved an Agreement with Carollo Engineers, Inc., (Carollo) for the preparation of a Preliminary Design Report (PDR), which serves as the basis of design for the project. The PDR evaluated improvements necessary, determined the most economical and beneficial approach, and evaluated different alternatives to address the existing deficiencies of the River Trunk.
The PDR confirmed that the existing River Trunk does not provide adequate capacity to convey peak wet weather flows, exposing the City to the risk of public health impacts and fines from sewer system overflows (SSOs). Additional flow capacity is required for the River Trunk to prevent SSOs in highly environmentally sensitive areas, such as Dry Creek and the Tuolumne River.
On March 1, 2016, by Resolution No. 2016-125, Council approved an Agreement with Carollo for Final Design Services for the River Trunk Realignment Project. The scope of the Agreement included the design of a major lift station and force-mains (River Trunk Pump Station - Project No. 1), the gravity sewer crossing under Beard Brook Park and gravity system along Colorado Avenue (River Trunk Gravity System – Project No. 2), and a pump station for the Shackelford Crossing (River Trunk Shackelford – Project No. 3). Upon completion of these three projects the former River Trunk will be available as a redundant system for domestic and industrial waste flows, providing increased reliability for industrial users and reduced liability in the event of a failure by preventing the discharge of raw sewage into the Tuolumne River. River Trunk Gravity System – Project No. 2 has been completed and River Trunk Shackelford – Project No. 3 is currently under construction.
DISCUSSION:
The River Trunk Pump Station was originally designed to be located at a property owned by the Tuolumne River Regional Park (TRRP) near the intersection of B Street and 9th Street. In 2017, near the end of the design phase of the project, it was discovered that the property had a deed restriction requiring it to be used as a park due to grant funding that had been previously received from the State and Federal Governments.
Over the course of the next several years design was placed on hold while the City diligently negotiated with the relevant grant funding agencies to remove the deed restrictions but were unable to obtain the necessary approvals.
In 2021, the City explored an opportunity to purchase land near the intersection of 10th Street and Morton Avenue. However, after numerous discussions, it was determined that the property was not a feasible location for the River Trunk Pump Station.
In 2022, the City looked into whether or not it would be possible to construct the River Trunk Pump Station within the unused portion of the Morton Avenue Right-of-Way (ROW) between 9th #8..
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Street and B Street. This segment of ROW is approximately 80 feet wide and 500 feet long.
Due to the tight space and the numerous deep structures required for the River Trunk Pump Station, it was determined that the ROW was not large enough to accommodate the project.
The City determined that the triangular property located at 131 9th Street (southwest corner of B Street and 9th Street) would be an appropriate location for the River Trunk Pump Station. This property is large enough to adequately construct, operate, and maintain the necessary facilities; For these reasons, staff negotiated the purchase of the property.
On July 11, 2023, by Resolution No. 2023-357, Council approved the purchase of the property located at 131 9th Street, Modesto.
On November 13, 2023, by Resolution No. 2023-511, Council approved an Agreement with Carollo for Final Design Services for the River Trunk Realignment – Pump Station Project. The scope of the Agreement included Project Management, Field Investigations, Permitting, Easement Acquisition, Stakeholder Coordination, Development of Construction Documents, Constructability Review Assistance and Bid Phase Services necessary to relocate the River Trunk Pump Station from the original design site location to the City’s newly acquired property located at 131 9th Street.
Given the project's magnitude and complexity, a request for qualifications (RFQ) was published on OpenGov, the City’s procurement platform, to prequalify contractors interested in participating in the bidding process. The City received nine responses, and following an evaluation by City personnel and the consulting engineering firm, seven contractors were deemed qualified to bid on the project. The project is currently out to bid and the bid opening has been scheduled for July 1st, 2025. The construction phase of this project is expected to begin in the Fall and take approximately three and a half years to complete.
FISCAL IMPACT:
Expenses associated with the River Trunk Realignment - Pump Station Project will be housed in the following Capital Improvement Program Project:
100646 - River Trunk Realignment
ANTICIPATED PROJECT EXPENDITURES:
Construction $106,000,000
Construction Contingency $10,600,000
Construction Administration
Construction Management Firm and City Staff
$9,000,000
Engineering/Design/Administration Services During Construction Consultant and City Staff
$5,400,000
TOTAL: $131,000,000
To assist in offsetting the impact this large-scale project will have on the Wastewater Fund, staff is pursuing approximately $60,000,000 in Bond funding.
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River Trunk Realignment – Pump Station Project
CEQA/NEPA REQUIREMENTS:
Environmental review has been provided through the 2017 Wastewater Master Plan Environmental Impact Report (EIR) (SCH # 2016062033) certified by Council on January 28, 2020.
RECOMMENDED COMMITTEE ACTION:
Staff Recommendation:
Motion accepting a Report on the upcoming River Trunk Realignment – Pump Station Construction Project.
Approved by:
William Wong, Director of Utilities
Joseph P. Lopez, City Manager
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