SP-3
be submitted to the City of Montebello for approval prior to fabrication. The sign is illustrated in “C”.
Size: 4 feet by 4 feet with a 7 feet clearance above ground level.
Materials: 3/4-inch (exterior type) plywood (C-C EXT-DFPA grade).
Support: 4-inch by 4-inch by 10 feet posts.
Mounting: Frame shall be constructed using 2 inches by 6 inches by 8 feet skids centered on each post and a 2 inch by 4 inches by 5 feet 6 inches 45-degree brace for each skid and 2 inches by 6 inches cross-strut between the bottom of the posts all of bolted construction. Plywood panel shall be mounted using 3/8 inch by 5 inches carriage bolts at 16 inches maximum on center.
Paint: Panel Face: Three coats outdoor enamel (sprayed) Panel Rear and Frame: Two coats outdoor enamel (sprayed).
Color: Stark white background and blue lettering.
Lettering: Silkscreen enamels, Helvetica medium.
Covering: 1/4 inch clear plastic.
Location: The signs shall be placed at each end of the street that work is being constructed on. If various locations of work are included, the signs will be moved by the Contractor per the City’s schedule.
Duration: The signs shall be placed a minimum of one week prior to start of work.
Disposition: After the Notice of Completion is issued, the sign shall become the property of the City, and the Contractor shall deliver the sign to the Public Works Facility at no expense to the City.
Payment for Project Information Signs shall be based on Each (EA) Unit Price basis and shall include full compensation for all labor materials, tools, equipment, and for doing all work involved, including delivery of the sign to the Public Works Facility at the end of the project.
Bid Item 2 - Traffic Control and Stage Construction
Traffic Control, Traffic Control plan, construction signing and traffic maintenance shall comply with the provisions of Subsection 7-10 of the Standard Specification, Subsection 56-2 of the Caltrans Standard Specifications, and the current requirements set forth in the “Manual of Traffic Controls for Construction and Maintenance Work Zones” published by the Department of Transportation, State of California, and Manual on Uniform Traffic Control Devices (CAPage 435 of 1738 SP-4
MUTCD), Latest Edition, by the Federal Highway Administration and California, the traffic control plans and these Special Provisions.
The Contractor shall maintain the following clearances from the edge of traffic lanes:
1) 5 feet to any excavation,
2) 2 feet to curbs or temporary concrete barriers,
3) 10 feet to poles and other obstructions on uncurbed roadways.
If determined by the Engineer that it is necessary to decrease these minimum distances to allow for the prosecution of the work, the Contractor shall provide all protective devices required by the Engineer to adequately protect the public.
PUBLIC CONVENIENCE
Within ten (10) working days after the date of the City’s execution of the Contract Agreement the Contractor shall submit a proposed Construction Schedule for approval. Based on the approved project schedule, the Contractor shall notify residents and businesses of the proposed work and post temporary “NO PARKING” signs at no cost to the City. Signs shall be posted at all intersections, and on each side of the street a maximum of 200 feet between signs. Signs may not be attached to existing poles, street lights standards or trees. All signs must be posted on delineators or stakes provided by the Contractor. The “NO PARKING” signs shall be in place not less than seventy two (72) hours prior to performing the work; therefore a request for changes in the schedule requiring additional posting shall be submitted by the Contractor for approval by the Engineer at least seventy-two (72) hours prior to reconstruction and paving the street. All conflicting parking signage shall be covered.
Due to the nature of this project involving major inconvenience to residents and businesses, a good Public Relations Program is mandatory and evidence of satisfactory past performance in this area will be required.
The Contractor is to distribute two (2) City-approved “Public Notice” to each residence and business affected by the project. The first notice shall be distributed ten (10) calendar days prior to the start of any work. The second notice shall be distributed at least seventy two (72) hours prior to the start of work on a specific section of the street. A sample copy of the notice must be approved by the City. Said notice shall be attached to a red information hanger provided by the Contractor and hung on the gate or front door knob. The Contractor shall also coordinate with the bus services to ensure the safe operation of buses and access to bus stops in the construction area.
Notices shall be in English and Spanish languages.
The Contractor shall also coordinate with the street sweeping, trash disposal, Montebello Bus Lines and postal services agencies to ensure the safe operation of their vehicle and access in the construction area.
All complaints received by the City associated with the construction project alleging damage to private property and vehiclesshall be responded to by the Contractor within twenty-four (24) hours
SP-5
(one working day) of notification. Failure to comply with this provision may result in a penalty of One Hundred dollars ($100.00) per occurrence.
All trucks, which the Contractor proposes to use, that exceed the legal load limit when loaded will be required to have overweight permits issued by the City.
The Contractor shall be responsible for adequate barricading of the work area and controlling of traffic in the vicinity of the project as specified in Subsection 7-10 of the General Provisions.
PROTECTION OF WORK AND PUBLIC
The Contractor shall take all necessary measures to protect work and prevent accidents during any and all phases of the work. The Contractor shall repair all damaged pavement as a result of vandalism (i.e., vehicle tracks, footprints, graffiti, etc.) If deemed necessary by the City, the Contractor shall repair the defective area in accordance with these special provisions.
CONSTRUCTION SIGNING
Construction signing shall consist of furnishing, installing, maintaining and removing construction signs and barricades as required by the “California Manual on Uniform Traffic Control Devices”, CA-MUTCD. The traffic control system shall be installed on a road prior to starting work for that road and shall not be removed until all work has been completed on that road. Existing speed limit signs, which conflict with the work zone speed limit, shall be covered during the entire construction period.
TRAFFIC MAINTENANCE
The Contractor shall be responsible for handling vehicular and pedestrian traffic in accordance with Subsection 7-10 of the Standard Specifications and these Special Provisions.
The Contractor shall prepare all necessary traffic control plans and submit to the City for approval at the pre-construction meeting. The traffic control plans shall be prepared by a California Licensed Traffic Engineer and shall show:
1. Notification Signs.
2. Existing and temporary lane lines.
3. Dimensions of the work zone and street improvements.
4. Advance warning signs.
5. Delineators
6. Lighting, for nighttime work.
The plans shall be submitted to the City at the preconstruction meeting prior to commencing work and shall incorporate a complete and separate plan for each stage of construction proposed by the Contractor. This plan shall indicate the sequence of lanes or portions of lanes being closed for each phase. The traffic control plans shall indicate the travel plan for each phase of construction.
The traffic control plans shall state:
SP-6
1. That the plan will conform to “California Manual on Uniform Traffic Control Devices”, CA-MUTCD.
2. Emergency contact person and phone number.
3. Minimum lane widths and minimum clearance to obstructions.
The traffic control plan shall be approved by the City of Montebello prior to beginning any removals.
The Contractor shall cooperate with the City of Montebello relative to handling traffic through all work areas and shall make his own arrangements relative to keeping the working area clear of parked vehicles and maintaining clear access to driveways.
The Contractor shall furnish and install construction notification signs as shown on traffic control plans and as specified by the City of Montebello.
The Contractor shall provide for controlled pedestrian crossings through the work. Crossings shall provide pedestrians a means of passing over or through the work without tracking tack coat or hot asphalt concrete or P.C.C. work or endangering pedestrian safety. All temporary pedestrian crossings shall be in compliance with the latest Americans with Disabilities Act design standards and supplements.
At intersections, if a cross road needs to be temporarily closed when work is in progress through the intersection and the anticipated traffic delay is more than five (5) minutes, a detour sign shall be installed on the cross street and shall include the installation of advance signing displaying the anticipated delay time. The signing of the detour route shall be approved by the Engineer prior to installation of the detour and closure of the road.
The Contractor shall provide for one lane of travel in each direction at all times unless approved by the Engineer. When two-way traffic is restricted to one lane in each direction, and when applying paving past intersecting roads, traffic shall be controlled as required by the “California Manual on Uniform Traffic Control Devices”, CA-MUTCD. A pilot car and driver will be required at various locations if control by flaggers and/or control devices proves deficient in the opinion of the Engineer. In no case shall the Contractor provide less than one (1) lane of travel in each direction through the construction zone including cross-streets.
Contractor’s equipment and personal vehicles of the Contractor’s employees shall not be parked on the traveled way at any time. Overnight parking of construction equipment shall be confined to an approved storage site selected by the Contractor and approved by the City.
TEMPORARY GUIDE MARKERS
Temporary guide markersshall be portable Caltrans Standard Specifications approved delineators.
Only one type of temporary guide marker shall be used on any road at any one time.
SP-7
Temporary guide markers shall be placed adjacent to the edge of all vertical lips or excavations that exceed 3/4 inches. If the temporary guide markers are damaged, or are not in an up-right position, from any cause, said markers should immediately be replaced or restored to their original locations, in an upright position by the Contractor.
PORTABLE DELINEATORS
The vertical portion of the portable delineators shall be brilliant orange or predominantly orange in color. The posts shall be not less than 100 square inches, measured through the vertical axis of the delineator, normal to the roadway. The minimum height shall be thirty-seven (37) inches above the traveled way.
Two 4-inch nominal width reflective bands shall be mounted a minimum of 1 ½ inches apart and at a height on the post so that one reflective band will be between 2.5 feet and 3 feet above the roadway surface.
Reflective bands shall be flexible vinyl plastic, either white or yellow, and shall have not less than the following dry reflective values at a 0.2 degree divergence angle, expressed I units if candlepower per foot-candle per square foot. The wet reflective values shall not be less than ninety percent (90%) of the dry values.
Dry Reflective Value
Angle of Incidence 4º 5º 30º
White 250 165 50
Yellow 10 110 50
All tests for reflective values shall be performed in accordance with California Test Method No. 642.
The portable delineators shall be spaced as necessary for proper delineation; however, in no case shall the spacing between portable delineators exceed thirty (30) feet on tangents or twenty (20) feet on curves.
FLUORESCENT TRAFFIC CONES
Provide lighted flashers and lighting for night time. Traffic cones shall be fluorescent new or reconditioned and of good commercial quality, flexible material suitable for the purpose intended.
The outer section of the portion above the base of the once shall be highly pigmented fluorescent orange polyvinyl compound. The overall height of the cone shall be anchored in a manner such that the traffic cone will remain in an upright position. Lighted flashers and lighting shall be provided additionally for nighttime.
The fluorescent traffic cones shall be spaced as necessary for proper delineation; however, in no case shall the spacing between fluorescent cones exceed thirty (30) feet on tangents or twenty (20) feet on curves.
SP-8
RESTRICTIONS ON CLOSURE OF STREETS AND TRAFFIC LANES
The Contractor shall conduct all operations so as to provide access to the adjoining properties and have no greater length or quantity of work under construction that can be properly prosecuted with a minimum of inconvenience to the public.
The Contractor shall construct temporary A.C. ramps or equal to provide safe and drivable access to residents and business properties daily.
The Contractor shall coordinate all shipments and deliveries to businesses. If steel plates are required, they shall be provided by the Contractor at no additional cost to the City.
The Contractor shall be responsible for furnishing, placing and maintaining barricades and lights as necessary to protect the public from danger due to the work being done.
No additional amounts shall be paid for erosion control, erosion damage clean-up, and removal of debris from the project site, NPDES requirements, or removal of soil deposited on public streets by construction traffic.
Payment for Traffic Control and Stage Construction shall be included in the Lump Sum (LS) Price bid and shall be considered full compensation for providing and maintaining safe traffic control including all temporary signs, striping and delineation, preparing and providing traffic control plan during the project, obtaining all approvals and permits, as required, from all related agencies, including, but not limited to, public agencies and the City of Montebello; and complying with the requirements specified in those licenses and permits, coordination, field office facility; and incidentals necessary to perform all related items of work.
Bid Item No. 3 – Clear & Grubbing & Removal of Shrubs
This Bid Item shall include removing existing shrubs and associated roots wherever they interfere with the footings. Grade and compact to a depth of 3-foot below existing grade.
Compact to 90-percent relative compaction. Contractor shall remove the tree, stump, and all roots larger than 1-1/2 inches in diameter to 36 inches below grade. Any water lines to remain shall be protected in place.
Payment for Clear & Grubbing & Removal of Shrubs shall be paid at the contract unit price per Lump Sum (LS) and shall include full compensation for removing, furnishing all labor, tools, equipment, sawcutting, hauling, properly disposing of materials and incidentals for doing all the work involved complete in place. No additional compensation will be allowed therefor.
Bid Item No. 4 – Chain Link Fence Removal
This section shall conform to Subsection 300-2 of the Standard Specifications and these Special Provisions. Under this item the Contractor shall remove existing chain link fencing as ordered by the Engineer. All work shall be done in accordance with these specifications. Existing fence shall become the property of the Contractor and shall be disposed of by him off the contract site. All reference to
SP-9
"fencing" shall include existing gates, if any, to be relocated.
Payment for Chain Link Fence Removal shall be paid at the contract unit price bid per Linear Feet (LF) and shall include full compensation for doing all work, including furnishing all materials, labor, equipment, tools, disposal of materials, and incidentals as required, and no additional compensation will be allowed, therefore.
The price includes protection of existing utilities located within the excavation limits.
Bid Item No. 5 – Fabricate and Install Fence
This section shall conform to Subsection 300-2 of the Standard Specifications and these Special Provisions. Furnish material and install Anti Climb wire mesh Fences approx. 8,500 LF as follows: Each panel approx. 10'L x 6'H - Diff. Sizes depending on the areas. Fences will be installed from 12" to 24" from the curb depending on areas.
Specification:
• Mesh: Double Welded wire 10 ga - 5/8" opening mesh - Grid size of the anti-climb mesh – Double mesh ½” x ½”
• Tek-screws ¼” x 1”
o Spot welds
• Frame: Steel Angle 1 1/2" x 1 1/2" x 1/8"
• Posts: 2" x 2" x 3/16"
o Depth of footing – 2’10”
o Posts have a plastic cap 2” x 2”
• Steel frame installed 2” gap from the finished surface • Flat bar (1”):
o Thickness - 1” x 1/8”
o Length - all around the back frame 10’L x 6’H
o Weld size and length required – ¼” Spot welds every 24” • Footing:
o 3’ deep – 12” diameter
o Rebar is required – 3 pcs rebar 3 ½“ long, welded on the bottom of the posts o PCC: 3,000 PSI concrete
• Powder coat Black
Payment for Fabrication and Install Fence shall be paid at the contract unit price bid per Linear Feet (LF) and shall include full compensation for doing all work (fabrication), including furnishing all materials, labor, equipment, tools, disposal of materials, delivery of fence, and incidentals as required, and no additional compensation will be allowed, therefore.
SP-10
SPECIAL PROVISIONS
PART 4 – EXISTING IMPROVEMENTS
FOR
CP-884 Rio Hondo Coastal Spreading Grounds Fence Replacement Project
IN THE CITY OF MONTEBELLO
PART 4 – EXISTING IMPROVEMENTS
The work required to be performed for the completion of the Project shall be performed in accordance with the Standard Specifications for Public Works Construction (SSPWC), latest Edition, in so far as the same applies to the Project, the Standard Plans and the Contract Documents.
For purposes of this Project, Part 4 of the SSPWC, is amended, as follows:
SECTION 400 – PROTECTION AND RESTORATION
400-1 GENERAL.
The second paragraph of Subsection 400-1 of the Standard Specifications is hereby deleted and replaced with the following:
The Contractor shall relocate, repair, replace or re-establish all existing improvements within the project limits which are not designated for removal (e.g., curbs, sidewalks, driveways, fences, walls, sprinkler systems, signs, utility installations, pavements, structures, etc.) which are damaged or removed as a result of the operations or as required by the Plans and Specifications. The Contractor shall make the effort to repair all sprinklers, pipe, etc by the end of the day.
Where existing traffic striping, pavement markings, and curb markings are damaged or their reflectivity reduced by the Contractor’s operations, such striping or markings shall also be considered as existing improvements and the Contractor shall repaint or replace such improvements. Prior to start of construction, Contractor and City Inspector shall visit and survey the site, and agree on locations outside the work limits and adjacent to it, and along truck routes where the traffic striping, pavement markings, and curb markings are in good condition prior to start of construction, and locations where the markings are faded prior to start of construction.
Contractor shall restripe or clean to the satisfaction of the City, all pavement markings and striping in the vicinity of the project and on truck routes damaged and soiled due the Contractor’s work.
SP-11
Relocations, repairs, replacements or re-establishments shall be at least equal to the existing improvements and shall match such improvements in finish and dimensions unless otherwise specified.
All existing improvements including Fence/Wall/Gates/Plants/Grass/Trees/Irrigation Systems/etc. that might be damaged during construction should be videotaped and it is Contractor’s responsibility to protect all existing adjacent features such as landscaping, irrigation system, property’s fence/wall/gates, curb and gutter, pull boxes, utility boxes, and etc. in place per section 400-1 of Standard Specifications for Public Works Construction. All damages to these items shall be fixed to the satisfaction of the City of Montebello without any additional compensation.
All costs to the Contractor for protecting, removing, restoring, relocating, repairing, replacing, or re-establishing existing improvements shall be included in the bid. 400-2 PERMANENT SURVEY MARKERS.
The following is added this this subsection of the Standard Specifications:
The Contractor shall be responsible for the protection and preservation of existing permanent survey monuments and benchmarks during construction. Damaged or lost monuments and benchmarks shall be restored to existing condition by a Registered Civil Engineer or a Land Surveyor licensed by the State of California at no increase in cost to the City.
The Contractor, at its own expense, shall employ a qualified surveyor to perform all survey work required for the completion of the project as specified in the plans and these specifications, comply with the requirements of Section 8771 of the Land Surveyors Act as amended and submit the documents from the County Surveyor as proof of compliance to the City of Montebello. 400-3 PAYMENT
This subsection of the Standard Specifications is hereby deleted and replaced with the following:
No separate or additional payment will be made for 1) protection of existing improvements, 2) restoration of existing improvements and 3) permanent survey markers. All costs to the Contractor for protecting, removing, restoring, relocating, repairing, replacing, or re-establishing existing improvements shall be included in the bid.
SECTION 402 – UTILITIES
402-1 LOCATION.
402-1.1 General.
The following is hereby added to this subsection of the Standard Specifications:
SP-12
The location and existence of any underground utility or substructure was obtained from a search of available records. No guarantee is made or implied that the information is complete or accurate.
It shall be the Contractor’s responsibility alone to determine the exact location of underground utilities or substructures of every nature and to protect them from damage. The Contractor shall excavate and expose all high-risk underground facilities. The Contractor shall notify the owners of all known utilities and substructures as set forth in the Specifications.
NOTIFICATION
The Contractor shall notify the City of Montebello and the owners of all utilities and substructures not less than 48 hours (2 working days) prior to starting construction. The following list of names and telephone numbers is intended for the convenience of the Contractor and is not guaranteed to be complete or correct:
Central
Basin
MWD
Isabelle
Guido
6252 Telegraph Rd
Commerce CA 90040
(323) 201-5541
[email protected]
Chevron
Environmental
Management
Company
Allen Just 18401 Von Karman Ave
Ste 300
Irvine, CA 92612
(714) 508-2677
[email protected]
Crimson
Pipeline LP
Shannon
Lovrien
3760 Kilroy Airport Way
Suite 300
Long Beach, CA 90806
(562) 285-4107
MCI
(Verizon
Business)
400 International Pkwy
Richardson, TX 75081
[email protected]
Montebello
Land & Wtr
Korey 1600 W Beverly Bl
Montebello, CA 90640
[email protected]
Crown Castle -
LA & VEN
Fiber Dig 1500 Corporate Dr
Canonsburg, PA 15317
(800) 654-3110
[email protected]
Redflex
Traffic
Systems
5651 W Talavi Blvd
Suite 200
Glendale, AZ 85306
(800) 568-8405
[email protected]
SoCalGas
Distribution
Belvedere
Jason Sum 701 N Long Beach Blvd
Compton, CA 90221
(310) 687-2011
ComptonUtilityRequest@semprautilities
.com
[email protected]
San Gabrial
Vally Wtr
Company
Kailyn Phu 11142 E Garvey Ave
El Monte, CA 91733
(626) 448-6183
[email protected]
SP-13
Spectrum -
Irwindale
David
Scharrer
4781 Irwindale Ave
Irwindale, CA 91706
626-430-3522
[email protected]
SCE Trans
Telecom,
Utiliquest for
SCE Dist -
Metro East &
West Reg
Engineering 14005 S Benson Ave
Chino, CA 91710
[email protected]
CITY POLICE AND FIRE DEPARTMENT Police: (323) 887-1313
Fire: (323) 887-4510
UNDERGROUND SERVICE ALERT (800) 422-4133 Tel
(909) 808-8101 Fax
TRASH COLLECTORS – ATHENS DISPOSAL (626) 336-6100
STREET SWEEPING – NATIONWIDE (562) 860-0604
MONTEBELLO UNIFIED SCHOOL DISTRICT (323) 887-7900
MONTEBELLO TRANSIT (323) 558-1625
EMERGENCY INFORMATION
The names addresses and telephone numbers of the Contractor and subcontractors, or their representatives, shall be filed with the Engineer and the City Police Department prior to beginning work.
402-1.2 Payment
Payment for provisions under section 402-1 of the Standard Specifications shall be considered included in the various items of the work. No separate payment will be authorized.
SP-48
SPECIAL PROVISIONS
PART 6 – TEMPORARY TRAFFIC CONTROL
FOR
CP-884 Rio Hondo Coastal Spreading Grounds Fence Replacement Project
IN THE CITY OF MONTEBELLO
PART 6 – TEMPORARY TRAFFIC CONTROL
The work required to be performed for the completion of the Project shall be performed in accordance with the Standard Specifications for Public Works Construction (SSPWC), latest Edition, in so far as the same applies to the Project, the Standard Plans and the Contract Documents.
For purposes of this Project, Part 6 of the SSPWC, is amended, as follows:
PART 6 – TEMPORARY TRAFFIC CONTROL
SECTION 600 – ACCESS
600-1 GENERAL.
The following is added to this subsection of the Standard Specifications:
The Contractor shall notify the occupants of all affected properties in writing at least forty-eight hours (2 working days) prior to any temporary obstruction of access. 600-2 VEHICULAR ACCESS.
The following is added to this subsection of the Standard Specifications:
Vehicular access to the property line shall be maintained except as required for construction for a reasonable period of time. No overnight closure of any driveway will be allowed except as permitted by the Engineer.
In cases where driveways require replacement. Where a property has two driveways, only one driveway at a time can be closed for replacement. Where a single driveway to a property has considerable width, half of the driveway is to be closed, worked on and reopened for usage before the other half of the driveway can be worked on.
SP-49
All driveways have to be open for access during project non-construction hours and days which may require use of plating and other devices or methods.
No driveway can be worked on until the owner/tenant has been informed in writing with five (5) working days’ notice of the scheduled work and has agreed to the planned schedule of the Contractor.
600-3 PEDESTRIAN ACCESS.
The following is added to this subsection of the Standard Specifications:
Under situations of sidewalk closure to pedestrians, the Contractor shall post advance notice on barricades to direct pedestrian to use the sidewalk on the opposite side of the street or the Contractor may elect to provide continuous K-rail in the curb lane to allow pedestrians to walk in the curb lane behind the K-rail. Any and all devices such as plates, barricades, K-rails and notices shall be continuously maintained for pedestrian and vehicle safety. No curb lanes shall be closed during non-working days of the week. Appropriate advance warning signs shall be continuously maintained as needed during the project. All such devices, warning signs and interruptions of normal vehicle lanes, parking lanes and pedestrian walkways shall be shown on the Traffic Control Plan for advance approval by the City.
SECTION 601 – TEMPORARY TRAFFIC CONTROL FOR CONSTRUCTION AND
MAINTENANCE WORK ZONES
601-1 GENERAL.
The following is added to this subsection of the Standard Specifications:
At least one twelve-foot-wide traffic lane shall be provided for each direction of travel on all arterial streets at all times except as permitted by the Engineer. With previous authorization from the City, the Contractor can provide one traffic lane on a single direction on residential streets, during construction hours.
Clearances from traffic lanes shall be five feet to the edge of any excavation and two feet to the face of any curb, pole, barricade, delineator, or other vertical obstruction.
Any striped roadway shall be delineated by the Contractor with temporary raised reflective markers when it is to be left un-striped overnight.
Street closures will not be allowed except as specifically permitted by the Engineer. 601-2 TEMPORARY TRAFFIC CONTROL PLAN (TCP)
601-2.1 General
The following is added to this subsection of the Standard Specifications:
At the Pre-Construction meeting, the Contractor shall submit to the Engineer a detailed traffic control plan per section 601 of the Standard Specifications and construction sequencing for the project. The plan shall include drawings as necessary to clearly outline how traffic flow and pedestrian walkways will be handled during the course of construction and where detour and advance notice signs will be posted.
Traffic control plan shall be approved in writing by the City Engineer prior to construction starts. The plan shall be prepared per latest edition of California Manual on Traffic Control Devices (CA-MUTCD).
Traffic lane transitions shall not be sharper than a taper of thirty to one.
Temporary striping will not be allowed unless specifically permitted by the Engineer. The Contractor shall prepare any plans that may be required for temporary striping to the satisfaction of the Engineer. In no event will temporary striping be allowed to remain on finish pavement surfaces.
In no case shall traffic be diverted from the existing traveled way without prior approval of the City Engineer.
The contractor shall include in his Traffic Control Plan use of lighted message boards to notify traffic of project and any changes in vehicle or pedestrian travel routes.
If the Contractor shall fail to provide and install any of the signs or traffic control devices ordered by the Engineer, the Engineer may either stop the work or cause such signs or traffic control devices to be placed by others and charge the cost therefor against the Contractor and deduct same from the next progress payment.
601-2.2 Payment
Payment for provisions under section 601 of the Standard Specifications shall be considered included under the bid item for traffic control. No separate payment will be authorized UI 1111
APPENDIX “A”
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APPENDIX “B”
DEPARTMENT OF INDUSTRIAL RELATIONS (DIR)
CONTRACTOR REGISTRATION NUMBER FORM
Department of Industrial Relations (DIR) Contractor
Registration Number
Beginning July 1, 2014, contractors must register with the Department of Industrial Relations (DIR) before bidding on public works contracts in California. For more information, please refer to this section of the Department of Industrial Relations Website:
http://www.dir.ca.gov/Public-Works/PublicWorks.html.
Per this requirement, provide the following information:
Contractor Name
Contractor Department of Industrial Relations Registration Number:
Expiration Date of Registration Number
*(THIS FORM MUST BE SUBMITTED WITH THE SEALED BID) *
APPENDIX “C”
PROJECT SIGN
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City of Montebello 55 Project Labor Agreement
APPENDIX “D”
PROJECT LABOR AGREEMENT
NO. 4202
AGREEMENT NO. 4202 – LOS ANGELES/ORANGE
COUNTIES BUILDING AND CONSTRUCTION
TRADES COUNCIL AND THE SIGNATORY CRAFT
COUNCILS AND UNIONS
Print Form
Revised 2011
Notice of Exemption Appendix E
To: Office of Planning and Research From: (Public Agency): City of Montebello P.O. Box 3044, Room 113
Sacramento, CA 95812-3044
County Clerk
1600 W. Beverly Boulevard
Montebello, CA 90640
County of: Los Angeles (Address)
Project Title: CP-884 Bluff Road Fence Replacement Project Project Applicant: City of Montebello
Project Location - Specific: Bluff Road between Sycamore Street and Mines Avenue Montebello, CA 90640 Project Location – City: Montebello Project Locations – County: Los Angeles Description of Nature, Purpose and Beneficiaries of Project: Removal of a chain link fence and replacement with a wrought iron fence.
Name of Public Agency Approving Project: City of Montebello Name of Person or Agency Carrying Out Project: Cesar Roldan, Director of Public Works Exempt Status: (check one):
Ministerial (Sec. 21080(b)(1); 15268);
Declared Emergency (Sec. 21080(b)(3); 15269(a)); Emergency Project (Sec. 21080(b)(4); 15269(b)(c)); Categorical Exemption. State type and section number: §15301 Class 1 Statutory Exemptions. State code number:
Reasons why project is exempt: Environmental Assessment pursuant to 14 California Code of Regulations § 15301 as a Class 1 categorical exemption under the California Environmental Quality Act (CEQA).
Lead Agency
Contact Person: Cesar Roldan Area Code/Telephone/Extension: 323-887-1462 If filed by applicant:
1. Attach certified document of exemption finding.
2. Has a Notice of Exemption been filed by the public agency approving the project? Yes No Signature: Date: June 26, 2025 Title: Director of Public Works Signed by Lead Agency Signed by Applicant
Authority cited: Sections 21083 and 21110, Public Resources Code. Date Received for filing at OPR:
Reference: Sections 21108, 21152, and 21152.1, Public Resources Code.
Attachment B
Attachment C
ITEM # 16
CITY OF MONTEBELLO
CITY COUNCIL AGENDA STAFF REPORT
TO: Honorable Mayor and City Council Members
FROM: Raul Alvarez, City Manager
BY: Cesar Roldan, Director of Public Works
SUBJECT: ACCEPTANCE OF THE FISCAL YEAR 2023-24 SB 1 ANNUAL YEAR 1 STREET IMPROVEMENT PROJECT (CP 913) – NOTICE OF
COMPLETION
DATE: June 25, 2025
RECOMMENDATIONS:
It is recommended that the City Council:
1. Accept the Fiscal Year 2023-24 SB 1 Annual Year 1 Street Improvement Project (CP 913) as completed by Hardy & Harper, Inc.; and,
2. Approve the final contract amount with Hardy & Harper, Inc. for the construction of the project in the amount of $2,550,047 including change orders; and,
3. Approve the Final Total Project Budget (Attachment A); and,
4. Authorize the City Clerk to execute, verify and file the Notice of Completion (Attachment B) with the Los Angeles County Registrar-Recorder; and,
5. Authorize the release of the retention payment of $127,502 due to Hardy & Harper, Inc. following the mandatory waiting period from the date the Notice of Completion is recorded; and,
6. Take such additional, related action that may be desirable.
FISCAL IMPACT:
The final project budget (Attachment A) reflects the City Council’s previously approved amount of $3,218,600 for Hardy & Harper, Inc., with total project expenditures totaling $2,550,047. This results in a remaining balance of $668,553 that will be made available for reprogramming for other capital improvement projects.
Staff allocated $2,000,000 from SB1 Funding, Account No. 201-30-330-6040.50 (RMRA Road Maintenance & Rehabilitation, Public Works Engineering, Contract Services –
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
Street Maintenance) and $926,000 in Proposition C Local Return funding, Account No. 215-99-7117 (Proposition C Non-Departmental, Improvements Other Than Building – Paving the Way) to complete the closeout of the Fiscal Year 2023-24 SB 1 Annual Year 1 Street Improvement Project (CP 913).
Staff successfully completed the project without utilizing the $292,600 contingency included in the Hardy & Harper contract. As outlined in the contract, an amendment would have been required if the contingency had been used; however, since it was not, no amendment was necessary to the contract.
BACKGROUND/DISCUSSION:
On December 5, 2024, the City Council approved a $2,926,000 construction contract with Hardy & Harper, Inc. Additionally, they authorized the Director of Public Works to review and approve change orders within a 10% contingency ($292,600), bringing the total notto-exceed amount to $3,218,600 for the FY 2023-24 SB 1 Annual Year 1 Street Improvement Project (CP 913).
This project resurfaced various streets in the City that were adopted via Resolution No. 23-54 (FY 2023-24 SB1) and the Annual Year 1 Paving the Way streets. The project includes improvements to thirty-three (33) streets, along with roadway striping enhancements. The project was deemed to be substantially completed on June 25, 2025.
Transtech Engineers, Inc., the engineering firm overseeing and inspecting the project, provided daily inspection reports and determined that the project was completed satisfactorily and in compliance with the contract specifications.
It is recommended that the City Council accept the project as satisfactory and complete pursuant to Civil Code Section 3093. Upon acceptance of the project, staff will file the “Notice of Completion” with the County Recorder’s Office. Thirty-five (35) days after the recordation of the Notice of Completion by the County Recorder’s Office, the City will release all applicable bonds and the retention if no Stop Notices are filed within the 35- day period.
ENVIRONMENTAL:
N/A
ANALYSIS:
N/A
SUMMARY:
Staff is recommending that the City Council accept the Project as completed, approve the final Project budget and expenditures, including change orders, authorize the City Clerk to execute, verify and file the Notice of Completion with the Los Angeles County Registrar-Recorder and authorize the City Manager to release the retention payment due to Hardy & Harper, Inc. following the mandatory waiting period from the date the Notice
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
of Completion is recorded.
ATTACHMENT(S)
1. Attachment A - Final Total Project Budget CP 913
2. Attachment B - Notice of Completion
Project Expenses Final Cost
Invoice #1 (Includes Partial Amount of Change Orders 1 & 2) $ 1,435,692.99 Invoice #2 (Includes Partial Amount of Change Orders 1& 2, and Change Order 3) $ 756,988.79 Invoice #3 (Include Change Order 4 &6) $ 229,862.84
Retention $ 127,502.35
Change Order #1 Additional PCC Improvements
Change Order #2 Manhole Reconstruction
Change Order #3 Speed Humps
Change Order #4 Saturday Paving Premiums
Change Order #6 Balancing Bid Quantities
Total Project Cost: $ 2,550,046.97
Project Funding Budget Amount
Awarded Construction Contract to Hardy & Harper - December 5, 2024 City Council Meeting $ 2,926,000.00
Awarded 10% Construction Contigency to Hardy & harper - Decemver 5, 2024 City Council Meeting $ 292,600.00
Total Project Budget: $ 3,218,600
Remaining Project Funds: $ 668,553
FY 2023-24 SB 1 Annual Year 1 Street Improvement Project (CP 913) Project Expenses $ 375,953.03
Attachment A
RECORDING REQUESTED BY
CITY OF MONTEBELLO
AND WHEN RECORDED MAIL TO
NAME CITY OF MONTEBELLO
CITY CLERK
STREET 1600 W Beverly Blvd.
ADDRESS
CITY Montebello,
STATE CA
ZIP 90640 SPACE ABOVE LINE FOR RECORDERS USE
________________________________________________________________________________________________________________________________________________
NOTICE OF COMPLETION
Notice pursuant to Civil Code Section 3093, must be filed within 10 days after completion. (See reverse side for complete requirements.) Notice is hereby given that:
1. The undersigned is owner or corporate officer of the owner of the interest or estate stated below in the property hereinafter described:
2. The full name of the owner is City of Montebello
3. The full address of the owner is 1600 W Beverly Blvd., Montebello, CA 90640
4. The nature of the interest or estate of the owner is: in fee. (if other than Fee, strike “In fee” and insert, for example, “purchaser under contract of purchase”, or “lessee”)
5. The full names and full addresses of all persons, if any, who hold title with the undersigned as joint tenants or as tenants in common are:
NAMES ADDRESSES
_______________________________________________________________________________________________
6. The full names and addresses of the predecessors in interest of the undersigned, if the property was transferred subsequent to the commencement of the work or improvements herein referred to:
NAMES ADDRESSES
____________________________________________________________________________________________
7. A work of improvement on the property hereinafter described was completed on June 25, 2025. The general scope of work consisted of resurfacing various streets adopted via Resolution No. 23-54 (FY 2023-24 SB1) and the Annual Year 1 Paving the Way streets, along with striping enhancements.
8. The name of the contractor, if any, for such work of improvement was Hardy & Harper, Inc.
December 5, 2024
(If no contractor for work of improvement as a whole, insert “None”) (Date of Contract)
9. The property on which said work of improvement was completed is in the City of Montebello County of Los Angeles, State of CA, and is described as follows: FY 2023-24 SB 1 Annual Year 1 Street Improvement Project (CP 913) Director of Public Works / City of Montebello___ (Signature of Owner or corporate officer of Owner named in paragraph 2, or his agent)
VERIFICATION
I, the undersigned, say: I am the City Clerk of the City of Montebello, the declarant of the foregoing Notice of Completion:
I have read said Notice of Completion and know the contents thereof; the same is true to my own knowledge. I declare under penalty of perjury that the foregoing is true and correct.
Executed on _________________, 2025 at City of Montebello, Montebello, CA __________________________________________________(Personal signature of the individual who is swearing that the contents of the Notice of Completion are true)
Attachment B
DO NOT RECORD
REQUIREMENTS AS TO NOTICE OF COMPLETION
A notice of completion must be filed for record WITHIN 10 DAYS after completion of the work of improvement (to be computed exclusive of the day of completion), as provided in Civil Code Section 3093.
The “owner” who must file for record a notice of completion of a building or other work of improvement means the owner (or his successor in-interest at the date the notice is filed) on whose behalf the work was done, though his ownership is less than the fee title.
For example, if A is the owner in fee, and B, lessee under a lease, causes a building to be constructed, then B, or whoever has succeeded to his interest at the date the notice is filed, must file the notice.
If the ownership is in two or more persons as joint tenants or tenants is common, the notice may be signed by any one of the co-owners (in fact, the foregoing form is designed for giving of the notice by only one cotenant), but the names and addresses of the other co-owners must be stated in paragraph 5 of the form.
Note that any Notice of Completion signed by a successor in interest shall recite the names and addresses of his transferor or transferors.
In paragraphs 3, 5 and 6, the full address called for should include street number, city, county and state.
As to paragraphs 7 and 8, this form should be used only where the notice of completion covers the work of improvement as a whole. If the notice is to be given only of completion of a particular contract, where the work of improvement is made pursuant to two or more original contracts, then this form must be modified as follows: (1) Strike the words “A work of improvement” from paragraph 6 and insert a general statement of the kind of work done or materials furnished pursuant to such contract (e.g., “The foundations for the improvements”); (2) Insert the name of the contractor under the particular contract in paragraph 7.
In paragraph 8 of the notice, insert the name of the contractor for the work of improvement as a whole. No contractor’s name need be given if there is no general contractor, e.g., on so-called “owner-builder jobs.”
In paragraph 9, insert the full, legal description, not merely a street address or tax description. Refer to deed or policy of title insurance. If the space provided for description is not sufficient, a rider may be attached.
In paragraph 10, show the street address, if any, assigned to the property by any competent public or governmental authority.
This standard form covers most usual problems in the field indicated. Before you sign, read it, fill in all blanks, and make changes proper to your transaction. Consult a lawyer if you doubt the form’s fitness for your purpose.
ITEM # 17
CITY OF MONTEBELLO
CITY COUNCIL AGENDA STAFF REPORT
TO: Honorable Mayor and City Council Members
FROM: Raul Alvarez, City Manager
BY: Michael Solorza, Director of Finance
SUBJECT: RECEIVE AND FILE THE FISCAL YEAR 2023-24 ANNUAL
COMPREHENSIVE FINANCIAL REPORT (ACFR)
DATE: June 25, 2025
RECOMMENDATIONS:
It is recommended that the City Council:
1. Recieve and file the Fiscal Year 2023-24 Annual Comprehensive Financial Report (ACFR); and
2. Take such additional, related action that may be desirable.
FISCAL IMPACT:
The action of receiving and filing the Annual Comprehensive Financial Report (ACFR) for the period ending June 30, 2024 does not have a fiscal impact.
BACKGROUND/DISCUSSION:
Each year the City produces an Annual Comprehensive Financial Report (ACFR) that presents audited financial results as of June 30 of the prior fiscal year. Staff is presenting the ACFR for the fiscal year ended June 30, 2024 (prior fiscal year). The City engages a third-party audit firm (PUN Group) to review all financial transactions, produce various statements, ensure compliance with Governmental Accounting Standards Board (GASB) statements, assist staff in compiling the ACFR document, review sample transactions and internal controls and provide an opinion on the accuracy and validity of the financial statements.
The auditors have provided an “un-qualified” opinion for the Fiscal Year 2023-24 report. In other words, this is a “clean” audit with no significant findings that would cause
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
the auditors to render a “qualified” opinion:
“In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2024, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.”
The ACFR is a document that tells “what happened” in the prior fiscal year, as opposed to a budget which is a plan for the upcoming fiscal year. There are statements, notes and financial schedules of required information that provide the reader a comprehensive view of revenues, expenses, assets, liabilities, cash and investments, debt, pension liabilities, and other financial data across the entire organization. There are also statistical tables which present a more complete (non-financial) picture of Montebello.
The Transmittal Letter (Attachment A) and Management Discussion and Analysis (MD&A) (Attachment B) provide extensive detail and discussion of the financial statements and are included in the final published ACFR report – which is available in its entirety on the City’s website. The extensive Notes section of the ACFR is also useful in providing a more complete explanation of the various financial aspects of the City, adding descriptions and explanations to the myriad schedules and tables.
This agenda report provides a summary of the document and does not replace a thorough review and understanding of the entire ACFR.
ENVIRONMENTAL:
N/A
ANALYSIS:
The ACFR presents information by type of fund, with the two most significant groupings of funds being Governmental Activities and Business-type Activities. Governmental Activities includes the General Fund as well as special funds: Gas Tax, Proposition A, Proposition C, Retirement Fund, and the various (non-Transit) Grant and Special Revenue Funds. Business-type Activities includes Transit, Golf Course, Hilton Garden Inn and the Home2Suites.
Included in the financial statements for both Governmental and Business-type funds is not only revenue and expenditures, but liabilities related to bond debt, pension and retiree medical liabilities, assets such as land, buildings and equipment, and other useful information designed to give the reader a clear picture of the City’s overall financial condition. The following pages provide an overview of major items found in the complete ACFR document (which can be found on the City’s website).
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
Government-wide Overview
The government-wide financial statements provide both long-term and short-term information about the City's overall financial position. The statement of net position includes all the City’s assets, deferred outflows of resources, liabilities and deferred inflows of resources. The City’s net position is a useful measurement of its financial health. Net position can be tracked over time to assess whether the City’s financial health is improving or deteriorating.
The City’s total net position was $49.890 million as of June 30, 2024, a decrease of $18.730 million compared to the net position of $68.620 million in FY 2022-23. Total assets decreased by $10.697 million ($543.525 million from $554.222 million).
Highlights of the key elements impacting the City’s net position for the fiscal year ended June 30, 2024, are as follows:
• Governmental Activities total expenses exceeded revenues including transfers by $21.162 million ($111.832 million in revenue vs. $132.994 million in expenses). • Business-type Activities total revenues including transfers exceeded total expenses by $3.086 million ($65.916 million in revenues vs. $62.830 million in expenses), with the change in net position after transfers a positive $3.086 million. • Total Citywide expenses before transfers were $195.824 million, an increase of approximately $30.089 million compared to the preceding fiscal year; with $16.487 million of the year-over-year increase in Public Works and an additional $7.734 million increase from the prior year in Public Safety (i.e., Police and Fire). • Total Citywide revenues as of June 30, 2024 including transfers were $177.748 million, a decrease of $25.795 million compared to June 30, 2023. Capital Grants decreased $21.029 million and Charges for Services decreased $19.139 million versus FY 2022-23
• Revenues are classified into program and general revenues. Total program revenues (Governmental and Business-type activities combined) were approximately $121.333 million which are used to offset program expenses under each functional activity and are comprised of charges for services, operating and capital grants. • Governmental Activities General revenues of approximately $56.415 million are used to offset the additional expenses net of program revenues and are comprised primarily of taxes (i.e., property, sales, franchise, etc.), but includes investment income and transfers.
• The overall decrease of 14.51% in total revenues ($25.795 million) for the City was primarily due to decreases in Capital Grants ($21.029 million) and Charges for Services ($19.139 million), offset by a $5.483 million increase in investment earnings. • The largest City-wide revenues came from several sources: charges for services (e.g. business license fees, building permits, hotel charges and bus fares) at $42.319 million,
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
operating grants and contributions (e.g. allocations of funds derived from Los Angeles County Metropolitan Transportation Authority Local Return Funds Propositions A and C, and Measures R and M) at $71.468 million, sales taxes at $25.658 million and property taxes ($8.704 million).
• Revenue from charges for services decreased by $19.139 million (45.23%), property tax increased by $1.453 million (16.69%) and other taxes increased 8.25% ($1.049 million).
• Total citywide expenses increased by $30.089 million, the net impact of increases in Public Works ($16.487 million), General Government ($3.191 million) Public Safety ($7.734 million) and Transit ($2.931 million); with a one-time reduction in Water ($2.393 million) as the Water Fund was closed out after the sale of the City’s water system in FY 2022-23.
• The cost of serving residents for the year (across Governmental and Business-type Activities) includes: $59.689 million for public safety (police and fire); $40.038 million for public works; $41.323 million for transit (Montebello Bus Lines); $15.474 million in general government; and $4.894 million for parks, recreation and culture.
Business-Type Activities
The City operates the following business-type activities: Transit System (i.e., Montebello Bus Lines), Golf Course, Hilton Garden Inn and Home2Suites. The City’s Transit System is the largest business-type operation (as defined by operating expenses), followed by Home2Suites, the Hilton Garden Inn and the Golf Course.
Business-type activities increased the City’s net position after transfers by $3.088 million, primarily a result of revenue (without transfers) exceeding expenses by $5.086 million ($67.916 million vs. $62.830 million).
Total revenues for business-type activities were $67.916 million, compared to $99.477 million in the previous fiscal year, constituting a 48.47% decrease ($31.661 million). The overall change is due to a $20.035 million decrease in Capital Grants and Contributions and a $17.412 million decrease in Charges for Services.
Approximately 33.23% of revenue came from Charges for Services, which was generated from bus fares, special contracts, and revenue from hotel room fees, while the remaining
66.77% comes from State and Federal subsidies in the form primarily of Transit related grants and related revenue from Federal, State and local (i.e., Los Angeles County Metropolitan Transportation Authority) agencies. Business-type Activities expenses increased $1.694 million in FY 2023-24 when compared to the prior fiscal year ($62.830 million versus $61.136 million).
• The Transit System reported operating revenues of $38.552 million, a $5.061 million increase (13.13%) when compared to FY 2022-23. There were increases in Federal and State transit assistance ($2.635 million) and Local Return Funds ($2.426 million) funding.
Operating expenses in FY 2023-24 were $38.645 million, a $1.657 million increase from the prior fiscal year. The majority of this increase ($3.698 million) was in Contractual
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
Services. Net position increased by $5.405 million.
• The Hilton Garden Inn reflected operating net income of $.812 million, comparable to the $.833 million surplus in FY 2022-23. The net income (surplus) is attributable to the recovering economy and the return of leisure and business travelers, leading to a direct increase in total occupancy. Operating revenues were very little changed year over year at $6.546 million, and operating expenses were also relatively flat at $5.734 million. Total change in net position was a positive $.740 million, contribution to ending net position of $1.368 million as of June 30, 2024.
• The Montebello Home2Suites reflected operating net income of $3.411 million, a slight decrease from FY 2022-23 of $442 thousand. Operating revenue was $13.039 million, a decrease of $.743 million vs. the prior fiscal year. As the economy recovers from the pandemic, a return to leisure and business travel has positively impacted the hotel’s operations. Total net position decreased by $.154 million, resulting in an ending net position of $.395 million as of June 30, 2024.
• The City’s Golf Course was closed for renovation from September 2022 through April 2024. The complete re-imagining of the Golf Course resulted in a new layout with two courses: a 9-hole and 6-hole (lighted) course. For FY 2023-24, the net operating loss was $2.128 million. This was primarily due to the fact that the course was open for only three months, and Contractual Services (i.e., engineering, architectural, design) expenses related to the Golf Course renovation and Clubhouse construction were charged to this fund.
Governmental Activities
Governmental Activities includes the General Fund, as well as myriad special funds that record activity related to road repair and maintenance (Gas Tax, SB1/RMRA, Proposition C, Measure M, etc.); assistance to low- and moderate-income households (CDBG, HOME), retirement expenses (Retirement Fund), debt service, public safety (Asset Forfeiture), and numerous public works, public safety and related grants. • Total governmental activities revenues increased by $5.766 million (5.25%). This is mainly due to increases in these revenue categories: Investment Earnings ($4.393 million), Operating Grants and Contributions ($2.056 million) and Property Taxes ($1.453 million).
• Operating Grants and Contributions (e.g. allocations of funds derived from Los Angeles County Metropolitan Transportation Authority Local Return Funds Propositions A and C, and Measures R and M) represent 32.10% of Governmental Activities revenue. • Sales tax revenues were the second largest portion of total governmental activities revenues (23.36%). Sales tax revenues decreased by $.694 million, to $25.658 million as of June 30, 2024.
• Charges for services were the third largest source of revenue for governmental activities (17.98%). Charges for services in governmental funds include licenses and permits, fines and forfeitures, waste collection, etc. Compared to the prior fiscal year, this
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
program revenue decreased by approximately $1.727 million, or 8.75%.
The cost of providing all governmental activities in FY 2023-24 was $132.994 million, an increase in expenses of $28.395 million (21.35%) when compared to June 30, 2023. There were increases and decreases to different categories, causing the overall net increase. Public Works increased the most ($16.487 million, 41.18%), followed by a $7.734 million increase in Public Safety, and $3.91 million increase in General Government.
General Fund
The General Fund is the City's main operating fund. It is used to account for revenues and expenditures necessary to perform basic government functions that are not accounted for through other special revenue and grant funds. These are the typical services residents see daily: police and fire service, street maintenance, community services programming, code enforcement, park maintenance, etc.
The key factors positively impacting fund balance of the General Fund for FY 2023-24 are as follows:
• General Fund operating revenues (i.e., taxes, charges for services, licenses and permits, etc.) increased by $1.945 million (2.70%) from the prior year, which is primarily due to the overall increase in property tax ($2.049 million), Investment Income ($1.411 million) and Franchise Taxes ($.436 million).
• The increase to Property Tax reflects continued improvement in overall assessed value in the City, as well as additions to total assessed value with completed residential construction in Metro Heights and other smaller developments within the City. • General Fund expenditures increased year-over-year by $11.923 million (15.58%).
The largest year-over-year increases in operating expenses were Public Works ($4.135 million), General Government $.697 million million) and Public Safety ($5.763 million). • Expenses related to the citywide solar project ($6.951 million) contributed to the yearover-year increase in Public Works expenditures, offset by salary and benefit savings in operating divisions.
• Expenses related to salaries, benefits (including special pays) and overtime in Police and Fire contributed to the year-over-year increase, $2.174 million in regular salaries and overtime in the Police Patrol Division and $.366 in Overtime expenditures in the Fire Suppression Division.
• The Police Headquarters rehabilitation project contributed $.946 million in expenses in FY 2023-24.
Economic Overview and Credit Rating
As of the date of this ACFR, the City’s S&P issuer credit rating (ICR) is “A+”, with the underlying credit rating on the City’s outstanding lease revenue bonds is “A”, with a “stable” outlook. These latest ratings were reaffirmed when the City issued $15.140
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
million in Lease Revenue Bonds, Series 2022A – Golf Course in September, 2022, which have been utilized to refurbish and reconstruct the City’s public golf course. The outlook for all ratings is “stable.” It should be noted that the “A+” ICR reflects S&P’s view of the City’s general creditworthiness.
The financial statements and commentary found in prior ACFR’s has been dominated by the impacts of the Coronavirus pandemic. For the results as of June 30, 2024, these impacts have disappeared and there appears to be a return to “pre-pandemic” economic and financial activity – albeit tempered by relatively high inflation which impacts interest rates on home mortgages, vehicle financing, credit card debt, etc. Overall, the local Montebello economy appears to be healthy, as evidenced by continued strong sales and transaction and use tax performance, as well as positive property tax revenue. Also, the City’s two hotels are performing well, seeing occupancy rates at or near levels last seen pre-pandemic (i.e., 2019).
For most of FY 2023-24, the discussion surrounding the economy focused on inflation, and the various causes of the generationally high inflation rate and methods used by the Federal Reserve to temper its impacts on the economy. Hand-in-hand with the inflation discussion have been discussions of whether the Federal Reserve can pull off a “softlanding” and prevent the U.S. economy from sliding into a recession. As of the publication of this ACFR, it appears the Federal Reserve’s reduction in the Federal Funds Rate, coupled with falling inflation and steady job growth have combined to – at least for now – avert an economic downturn.
For this and other reasons, it is imperative that Montebello’s economic development activities promote projects that expand the City’s sales tax and property tax base. Looking ahead, there is much to be excited about in Montebello in these arenas, with several projects begun prior to FY 2023-24 that will contribute to the City’s long-term economic health and viability once completed in the near future.
The issuance of $15.140 million in lease revenue bonds in September, 2022 (LRB Series 2022A) has ushered in a new era for the City’s public golf course, with the re-opening occurring in April, 2024. These proceeds have been used to completely reconstruct the existing golf course, creating a championship 9-hole course, a 6-hole “executive” course, and adding lights for the ability to play golf during evening hours. This project will help the Golf Course reduce – even eliminate – the subsidy required from the General Fund. Shortly after the golf course re-opened, the new Clubhouse was completed and opened to the public in October, 2024.
Connected to the Golf Course Renovation Project is the Topgolf facility, constructed on 15 acres of the existing golf course property. Topgolf opened to the public in May, 2024. This project is funded with the $55.4 million in lease revenue bonds issued in December, 2022 (LRB Series 2022B). In a unique financing arrangement, the Public Financing Authority issued the bonds, with a sub-lease and guaranty tied to the issuance that requires Topgolf to pay the annual debt service (i.e., improvement rent). The completed Topgolf facility is a three-story entertainment and event center, featuring 102 hitting bays, a restaurant, meeting space and a pro shop. In addition to the commitment to pay annual debt service, Topgolf pays an annual lease for the use of City property
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($1.150 million for the first five years, with increases every five years after). In addition, the facility will generate sales tax revenue, which will help boost overall General Fund revenue.
In addition to these exciting capital projects and economic development initiatives completed in FY 2023-24, the City finally received approval from the Public Utilities Commission (PUC) to sell its water system. The PUC decision was finalized in December 2022, and escrow closed in February 2023. The sale of the water system to San Gabriel Valley Water Company (SGVWC) concludes a long saga of the City attempting to sell its water system. The State Auditor, in its December 2018 report, recommended the City pursue the sale, and the October 2021 follow up report noted this recommendation and continued to support the sale. The City received $15.857 million in proceeds from the sale, which was recorded as non-operating revenue in the General Fund in FY 2022-23, positively impacting reserves. In addition, the City will receive annual water rights lease payments as condition of the sale of the water system.
As noted in the preceding pages, the General Fund’s fund balance increased by $3.289 million, to $31.756 million as of June 30, 2024. The fiscal year-ending fund balance as of June 30, 2024 allows for partial implementation of the reserve policies approved by City Council in June 2020. One Commitment – Economic Uncertainties has been reserved in fund balance. Details on General Fund reserve classifications can be found in Note 13 of the ACFR.
In FY 2023-24, the City continued critical work related to upgrading its information technology and cybersecurity infrastructure. This project has been funded using a portion of the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) revenue the City received between May 2021 and 2022. The total $16.59 million in CSLFRF revenue received by Montebello has been categorized as “revenue loss,” as permitted by U.S. Treasury Interim Final and Final Rules. This much needed funding has allowed the City to fast-track the technology upgrade, improving security, storage and productivity hardware and software. This funding has also repaired and improved the City’s sewer infrastructure and provided funding for public safety (i.e., Police and Fire) salaries and benefits.
These are just a few highlights of the many projects underway in Montebello that are aimed at improving residents’ lives and helping to put the City on a long-term path to financial stability and sustainability. Some other projects that either began or were continued into FY 2023-24 are the following:
• Completion of the transformation of the City’s public golf course – a re-opened Bella Verde Golf Course (Spring 2024) that provides an improved golfing experience for the community
• Opening of the 100th Topgolf Entertainment Complex in Spring 2024 – transforming 15 acres of the former golf course into a destination site • Continued growth in revenue from the three-quarter cent sales tax measure (Measure H), approved by 62% of Montebello’s voters in March 2020 • Continued progress in upgrading the City’s streets and roadways through use of $25 million in bond funding for the “Paving the Way” program
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
• Approval of an updated General Plan, the first such endeavor since 1973 • Upgraded the City’s vehicle fleet, purchasing replacement vehicles for Police, Public Works and Fire
• Expanded community programs with a season-long Farmer’s Market, Night Market, Pet Vaccine Clinics, a summer street-fest, and other resident favorite programs • Significant progress toward completion of an affordable housing project in downtown Montebello (6th Street) developed by the Cesar Chavez Foundation • Continued progress towards completion of 1,200 housing units as part of the Metro Heights development
• Significant upgrades to the City’s Police Department headquarters building, an investment of $1.25 million in facility and equipment improvements Management and the City Council continue to be dedicated to improving Montebello’s long-term financial sustainability. Pursuing projects that are externally and internally focused – capital and infrastructure projects as well as organizational improvements – will strengthen Montebello’s abilities to weather changes in the economy as well as the “next pandemic,” in whatever form that may appear.
SUMMARY:
The recommended action is for the City Council to receive and file the Annual Comprehensive Financial Report (ACFR) for the fiscal year ending June 30, 2024.
ATTACHMENT(S)
1. Attachment A - Transmittal Letter FY 2023-24
2. Attachment B - MD&A FY 2023-24
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April 22, 2025
Honorable Mayor and Members of the City Council:
The Annual Comprehensive Financial Report (ACFR) of the City of Montebello for the fiscal year ended June 30, 2024 is submitted as prepared by the City’s Finance Department. The report is published to provide the City Council, community and other interested parties detailed financial and operational information about the City for the previous fiscal year. The financial statements are audited by a third-party accounting firm, providing assurance to the public that the City’s financial reporting and associated operations meet or exceed generally accepted accounting and auditing standards.
The ACFR is presented in three sections: the Introductory Section, the Financial Section, and the Statistical Section. The Management Discussion and Analysis (MD&A) is the most useful for readers of the ACFR to find a general overview of the City’s financial condition at year-end, providing highlights of significant changes or key events impacting year-end financial results.
Responsibility for both the accuracy of the financial report and the completeness and fairness of the presentation rests with the City. To the best of our knowledge, the information presented is accurate in all material aspects and includes all disclosures necessary to enable the reader to gain an understanding of the City’s financial activities.
The City prepared the ACFR using the financial reporting requirements outlined in the Governmental Accounting Standards Board (GASB) Statement No. 34. This statement requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of a Management Discussion and Analysis (MD&A) section. This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City’s MD&A can be found immediately following the report of the independent auditors in the financial section of the ACFR.
The City requires that its financial statements be audited by an independent, accredited auditing firm on an annual basis. This requirement has been satisfied, and the auditor’s opinion is included in the financial section of the ACFR.
In addition, the City is required to undergo an annual single audit to conform to the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). This requirement has also been satisfied, with the single audit published separately as a stand-alone document.
THE FINANCIAL REPORTING ENTITY
This report includes activity of all funds of the City, with presentation in the ACFR being done on a major vs. other funds basis. All funds have their appropriations approved by the governing body (i.e., City Council) through the annual budget development process. In addition to the General Fund, other governmental and enterprise funds are utilized to record financial activity. Each fund is appropriated annually, and includes the General Fund, Proposition A, Proposition C, Measure
ATTACHMENT A
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M, Measure R, HOME, Community Development Block Grant (CDBG), Gas Tax, Grants (nonTransit), Asset Forfeiture, Grants (Transit), Debt Service, Retirement, Asset Forfeiture, etc.
Revenue and expenditures are appropriated through the budget process, with the FY 2023-24 budget (all funds) adopted at a regular City Council meeting in June 2023, and amended as needed throughout the fiscal year.
The City of Montebello provides a full range of municipal services including police and fire protection, street maintenance, transit (Montebello Bus Lines) planning and community development, parks and recreation services, financial planning, treasury management, information technology, human resources, engineering, code enforcement and general administration.
Montebello also operates several enterprise funds, which include a municipal golf course, a transportation system (Montebello Bus Lines), and two hotels (i.e., Hilton Garden Inn and Home2Suites). Enterprise funds are financed from user charges (e.g., green fees, room charges, bus fares, etc.) and revenue from other governmental agencies (e.g., Los Angeles County Metropolitan Transportation Authority funding for fixed transit lines), as applicable.
ACCOUNTING SYSTEM
The modified accrual basis of accounting is followed for governmental fund types and the accrual basis of accounting is followed for proprietary and fiduciary fund types. In reviewing and developing the City’s accounting system, consideration is given to the adequacy of internal accounting controls. Internal accounting controls are designed to provide reasonable, but not absolute assurance regarding:
The safeguarding of assets against losses from unauthorized use or disposition and the reliability of financial records for preparing financial statements and maintaining accountability for assets.
The concept of reasonable assurance recognizes that the cost control procedures should not exceed the benefits likely to be derived and that the evaluation of costs and benefits require estimates and judgment by management.
All internal control evaluations occur within the above framework.
As discussed more fully below, management has made a concerted effort to improve internal controls by updating the Municipal Code, creating and implementing new procedures and policies, implementing a regime of regular training and generally ensuring internal policies and procedures are efficient while not sacrificing requisite safeguards against fraud, waste and abuse.
BUDGETARY CONTROL
In addition to internal accounting controls, the City also maintains budgetary controls. The objective of these budgetary controls is to ensure compliance with the City’s budget policy approved by the City Council as incorporated in the budget adoption resolution. Appropriations of the General Fund, special revenue funds, debt service funds, and capital project funds are included in the annual approved budget. The City’s adopted budget document includes detailed information about the approval process. A budget calendar, various budget schedules and related policies can be found in that document.
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Budgetary control is maintained at a functional level by division within the department through the use of object code level accounting as actual expenditures are compared to appropriations. As purchase orders are approved, appropriations are encumbered. Encumbrances and expenditures, which would cause an overrun of appropriations, require an approved budget transfer, which is reviewed and approved by the Director of Finance, pursuant to the Annual Budget Resolution and the Municipal Code. The City’s Capital Improvement Program (CIP) is adopted at the same time as the operational budget and includes various street and infrastructure improvement projects. Any action to increase total appropriations requires approval by a majority vote of the City Council.
IMPROVEMENTS TO INTERNAL CONTROLS
Over the span of the last five years the City has put into place numerous new procedures and policies aimed at improving internal controls governing procurement, invoice approval, purchase orders, contracts/agreements, requests for proposals/quotes, etc.. The City’s municipal code chapters dealing with purchasing and procurement were updated in March 2019, February 2022 and February 2023 – utilizing best practice language found in neighboring cities’ municipal codes and aimed at improving and professionalizing Montebello’s procurement practices. In addition, citywide purchasing training has been conducted at least three times per year since 2020. Several new administrative policies have been developed that addressed identified areas of weakness:
petty cash handling, credit card use, hotel financial reporting, issuance of RFPs/RFQs, etc., while other existing policies were updated.
The improvements made in organizational management and internal controls indicate that Montebello is making positive strides in ensuring future financial stability, as well as putting into place policies and procedures that ensure public funds are managed and spent wisely.
ADOPTION OF FORMAL RESERVE POLICIES
In addition to improvements to internal controls, the City is demonstrating its commitment to fiscal sustainability by the adoption of General Fund reserve policies. The City Council first adopted comprehensive reserve policies in June 2020. These policies are incorporated into the adopted budget document and are presented annually for review and approval by the City Council, which has been done every June since 2020. The reserve policies in effect for FY 2023-24 were approved in June 2023.
Having such written policies indicates to third parties (i.e., credit rating agencies) that Montebello has a clear plan for how to manage General Fund reserves – spendable and non-spendable. Fully compliant with GASB 54, the policies establish distinct reserve categories for various uses:
Economic Uncertainties
Unfunded Liabilities
Equipment/Technology Replacement and Upgrade
Capital Improvement (Unfunded/Un-programmed)
Deferred Maintenance
Insurance – Risk Management
Economic Sustainability
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Each reserve category sets aside a specific amount – either a fixed dollar amount or an amount calculated as a percentage of prior year operating revenues. The policy, per GASB 54, makes “commitments” or “assignments,” and describes the method by which each reserve can be utilized. Furthermore, the policy includes the method for replenishing the various reserve buckets, should they be used and fall below the pre-scribed amounts. The FY 2023-24 adopted budget document contains the Reserve Policies.
Reserve balances in the General Fund as of June 30, 2024 are sufficient enough to provide for partial implementation of the Reserve Policies. General Fund reserves increased by $3.289 million from June 30, 2023, to $31.756 million, allowing for a Commitment for Economic Uncertainties ($18.506 million) to be made. The June 30, 2024 fund balance is 42.90% of operating revenues. Should future fund balances continue to grow, additional designations per the reserve policies will be made.
GENERAL INFORMATION AND ECONOMIC OUTLOOK
The City of Montebello was incorporated on October 16, 1920 and is progressing positively into its second century of existence. The City is a general law city and functions under the City CouncilManager form of government. The City is governed by a legislative body of five City Councilmembers elected by district (as of November 2022) and serving staggered, four-year terms, with the Mayor and Mayor Pro-Tem selected by fellow Councilmembers. The City Clerk and City Treasurer are also elected to four- year terms. The City Manager and City Attorney are appointed by the City Council.
Montebello is located nine miles east of the Los Angeles Civic Center, with access to three freeways – the Santa Ana Interstate 5 Freeway to the south, the Pomona State Route 60 Freeway to the north, and the San Gabriel River Interstate 605 Freeway to the east. The City has a population of approximately 64,000 living in an area of 8.2 square miles. The City is a balanced community with industrial, residential, and commercial areas.
The financial statements and commentary found in prior ACFR’s has been dominated by the impacts of the Coronavirus pandemic. For the results as of June 30, 2024, these impacts have disappeared and there appears to be a return to “pre-pandemic” economic and financial activity – albeit tempered by relatively high inflation which impacts interest rates on home mortgages, vehicle financing, credit card debt, etc. Overall, the local Montebello economy appears to be healthy, as evidence by continued strong sales and transaction and use tax performance, as well as positive property tax revenue. Also, the City’s two hotels are performing well, seeing occupancy rates at or near levels last seen pre-pandemic (i.e., 2019).
For most of FY 2023-24, the discussion surrounding the economy focused on inflation, and the various causes of the generationally high inflation rate and methods used by the Federal Reserve to temper its impacts on the economy. Hand-in-hand with the inflation discussion have been discussions of whether the Federal Reserve can pull off a “soft-landing” and prevent the U.S. economy from sliding into a recession. As of the publication of this ACFR, it appears the Federal Reserve’s reduction in the Federal Funds Rate, coupled with falling inflation and steady job growth have combined to – at least for now – avert an economic downturn.
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For this and other reasons, it is imperative that Montebello’s economic development activities promote projects that expand the City’s sales tax and property tax base. Looking ahead, there is much to be excited about in Montebello in these arenas, with several projects begun prior to FY 2023-24 that will contribute to the City’s long-term economic health and viability once completed in the near future.
The issuance of $15.140 million in lease revenue bonds in September, 2022 (LRB Series 2022A) has ushered in a new era for the City’s public golf course, with the re-opening occurring in April, 2024. These proceeds have been used to completely reconstruct the existing golf course, creating a championship 9-hole course, a 6-hole “executive” course, and adding lights for the ability to play golf during evening hours. This project will help the Golf Course reduce – even eliminate – the subsidy required from the General Fund. Shortly after the golf course re-opened, the new Clubhouse was completed and opened to the public in October, 2024.
Connected to the Golf Course Renovation Project is the Topgolf facility, constructed on 15 acres of the existing golf course property. Topgolf opened to the public in May, 2024. This project is funded with the $55.4 million in lease revenue bonds issued in December, 2022 (LRB Series 2022B). In a unique financing arrangement, the Public Financing Authority issued the bonds, with a sub-lease and guaranty tied to the issuance that requires Topgolf to pay the annual debt service (i.e., improvement rent). The completed Topgolf facility is a three-story entertainment and event center, featuring 102 hitting bays, a restaurant, meeting space and a pro shop. In addition to the commitment to pay annual debt service, Topgolf pays an annual lease for the use of City property ($1.150 million for the first five years, with increases every five years after). In addition, the facility will generate sales tax revenue, which will help boost overall General Fund revenue.
In addition to these exciting capital projects and economic development initiatives completed in FY 2023-24, the City finally received approval from the Public Utilities Commission (PUC) to sell its water system. The PUC decision was finalized in December 2022, and escrow closed in February 2023. The sale of the water system to San Gabriel Valley Water Company (SGVWC) concludes a long saga of the City attempting to sell its water system. The State Auditor, in its December 2018 report, recommended the City pursue the sale, and the October 2021 follow up report noted this recommendation and continued to support the sale. The City received $15.857 million in proceeds from the sale, which was recorded as non-operating revenue in the General Fund in FY 2022-23, positively impacting reserves. In addition, the City will receive annual water rights lease payments as condition of the sale of the water system.
As noted in the preceding pages, the General Fund’s fund balance increased by $3.289 million, to $31.756 million as of June 30, 2024. The fiscal year ending June 30, 2024 allows for partial implementation of the reserve policies approved by City Council in June 2020. One Commitment – Economic Uncertainties has been reserved in fund balance. Details on General Fund reserve classifications can be found in Note 13.
In FY 2023-24, the City continued critical work related to upgrading its information technology and cybersecurity infrastructure. This project has been funded using a portion of the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) revenue the City received between May 2021 and 2022. The total $16.59 million in CSLFRF revenue received by Montebello has been categorized as “revenue loss,” as permitted by U.S. Treasury Interim Final and Final Rules. This much needed funding has allowed the City to fast-track the technology upgrade, improving security, storage and productivity hardware and software. This funding has also repaired and improved the City’s sewer infrastructure and provided funding for public safety (i.e., Police and Fire) salaries and benefits.
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ACCOMPLISHMENTS AND ACHIEVEMENTS
Montebello has made tremendous strides by improving its financial standing and overall operations in recent years, and this progress continued in Fiscal Year 2023-24. In addition to the many accomplishments discussed in the preceding pages, some of the many positive accomplishments this past year include:
Completion of the transformation of the City’s public golf course – a re-opened Bella Verde Golf Course (Spring 2024) that provides an improved golfing experience for the community.
Opening of the 100th Topgolf Entertainment Complex in Spring 2024 – transforming 15 acres of the former golf course into a destination site. Continued growth in revenue from the three-quarter cent sales tax measure (Measure H), approved by 62% of Montebello’s voters in March 2020.
Continued progress in upgrading the City’s streets and roadways through use of $25 million in bond funding for the “Paving the Way” program. Approval of an updated General Plan, the first such endeavor since 1973. Upgraded the City’s vehicle fleet, purchasing replacement vehicles for Police, Public Works and Fire.
Expanded community programs with a season-long Farmer’s Market, Night Market, Pet Vaccine Clinics, a summer street-fest, and other resident favorite programs. Significant progress toward completion of an affordable housing project in downtown Montebello (6th Street) developed by the Cesar Chavez Foundation. Continued progress towards completion of 1,200 housing units as part of the Metro Heights development.
Significant upgrades to the City’s Police Department headquarters building, an investment of $1.25 million in facility and equipment improvements.
Management and the City Council continue to be dedicated to improving Montebello’s long-term financial sustainability. Pursuing projects that are externally and internally focused – capital and infrastructure projects as well as organizational improvements – will strengthen Montebello’s abilities to weather changes in the economy as well as the “next pandemic,” in whatever form that may appear.
These and other accomplishments have helped set Montebello on the right path towards fiscal sustainability and operational stability. The following pages provide technical information related to the City’s accounting system, budgetary control, cash and investments, etc. Greater detail is available in the MD&A, the various notes to the financial statements, required supplementary information (RSI) and statistical sections.
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ACKNOWLEDGEMENTS
The preparation of the City's Annual Comprehensive Financial Report (ACFR) could not have been accomplished without the dedicated services of the entire Finance Department, as well as assistance from each of the operating departments. I want to specifically thank the entire Finance Department, and especially the Accounting Division, for their commitment to ensuring the ACFR was completed accurately. The City’s independent auditor – The Pun Group – provided invaluable assistance and expert advice in completing the ACFR.
I also want to thank the City Council, the Executive Management Team and City staff for their interest and support of the financial operations of the City and helping ensure Montebello thrives financially and operationally.
City of Montebello
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2024
5 The following section represents Management’s Discussion and Analysis (MD&A). It is intended to provide narrative overview and analysis on the City’s financial performance for the fiscal year ended June 30, 2024. Readers are encouraged to consider the information presented here in conjunction with the accompanying letter of transmittal and financial statements.
Overview of the Financial Statements
The City's basic financial statements consist of three components: 1) Government-wide Financial Statements, 2) Fund Financial Statements, and 3) Notes to the Basic Financial Statements. The Statistical section at the end of this report provides supplementary information in addition to the basic financial statements. Government-wide Financial Statements are prepared using accrual accounting method to demonstrate the City’s operational accountability, while the Fund Financial Statements are based on modified-accrual accounting method to demonstrate its budgetary accountability. Reconciliations of the Fund Financial Statements to the Government-wide Financial Statements are provided to explain to readers the differences created by this integrated approach.
Government-wide Financial Statements
The Government-wide Financial Statements provide a broad overview of the City's finances, in a manner similar to a private-sector business. The statements present information about the functions of the City principally supported by taxes and intergovernmental revenues (governmental activities). The governmental activities of the City include general government (i.e., administration, finance, human resources, elected officials, etc.) public safety, public works, parks and recreation, and housing and community development. Business-type activities of the City include water, golf course, transportation and hotel operations. These statements include all assets of the City as well as all liabilities (including long-term debt). Additionally, certain eliminations have occurred as prescribed by the statement in regard to inter-fund activity, payables, and receivables.
The Statement of Net Position and the Statement of Activities report information about the City as a whole and about its activities. These statements include all assets and liabilities of the City using the accrual basis of accounting, which is similar to the accounting used by most private sector companies. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
The government-wide financial statements can be found immediately following this discussion and analysis.
Fund Financial Statements
The Fund Financial Statements include statements for three categories of activities: Governmental Funds, Proprietary Funds and Fiduciary Funds. The governmental activities are prepared using the current financial resources measurement focus and the modified accrual basis of accounting.
A Fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
Governmental Funds. Governmental funds are used to account for essentially the same functions reported as Governmental Activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements.
ATTACHMENT B
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
6 Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the Government-wide Financial Statements. By doing so, readers may better understand the long-term impact of the government's near-term financing decisions. Both the governmental fund Balance Sheet and the governmental fund Statement of Revenues, Expenditures, and Changes in Fund Balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.
The City maintains various individual governmental funds. Information is presented separately in the Governmental Funds Balance Sheet, and in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances, for the General Fund, the Retirement Special Revenue Fund, the Public Financing Authority Debt Service Fund, and the Housing Successor Special Revenue Fund, all of which are considered to be major funds. Data from other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these other governmental funds is provided in the form of combining statements elsewhere in this report. As a result of Assembly Bills 1X26 and 1484, Redevelopment Agency assets and liabilities are no longer a part of the governmental funds of the City and are now reported in the Fiduciary Fund section of the financial statements.
The City adopts an annual appropriated budget for all of its individual funds, including the major funds as listed above.
The basic financial statements include a budgetary comparison statement for the General Fund. The budgetary comparison statement has been provided to demonstrate compliance with this budget.
The basic governmental fund financial statements can be found immediately following the government-wide financial statements.
Proprietary Funds. Proprietary funds are generally used to account for services for which the City charges external customers, or other units of the City. Proprietary funds provide the same type of information as shown in the government-wide statements, only in more detail. The City maintains the following two types of proprietary funds. • Enterprise funds are used to report the same functions presented as business-type activities in the governmentwide financial statements. The City uses enterprise funds to account for the operations of the golf course, transit system, Hilton Garden Inn and Home2suites Hotels.
• Internal service funds are used to report activities that provide internal services for the City. The City uses an internal service fund to account for workers' compensation and general liability expenses, including insurance premiums. Because internal service funds predominantly benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements.
Fiduciary Funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City's own programs. The basic fiduciary fund financial statements can be found immediately following the basic proprietary fund financial statements and include the assets and liabilities of the Successor Agency Fiduciary Fund.
Notes to financial statements
The notes to financial statements provide additional information that is essential to a full understanding of the data provided in the Government-wide and Fund Financial Statements. The notes to the basic financial statements can be found immediately preceding the Required Supplementary Information.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
7 Other information
The combining statements referred to earlier in connection with other governmental funds and internal service funds are presented for all other Special Revenue Funds, all other Debt Service Funds, all other Capital Projects Funds, and all Internal Service Funds. These combining fund statements and schedules of revenues, expenditures and changes in fund balance - budget and actual for individual funds – can be found immediately following the notes to financial statements.
Note: The numbers shown on the MD&A are either expressed in multiples of one thousand or million dollars while percentages are rounded to the nearest tenth or whole number. Hence, there may be slight differences between numbers on the MD&A and the numbers on the Basic Financial Statements.
Financial Highlights
The following are entity-wide financial highlights, covering both Governmental and Business-type activities:
• On June 30, 2024, the City’s total net position was approximately $49.879 million dollars, a decrease of $18.741 million compared to the $68.620 million total net position as of June 30, 2023. The City’s unrestricted net position, at a negative $132.273 million, increased (improved) by $16.9 million dollars versus the prior fiscal year.
• Total revenues from all sources were $177.750 million while total expenses were $180.358 million. Of the total revenues, program revenues totaled $121.334 million while general revenues totaled $56.415 million, excluding transfers.
• The City’s General Fund operating expenses (including Capital Outlay and Debt Service) exceeded operating revenue by $14.432 million in Fiscal Year 2023-24. The General Fund fund balance totaled $31.757 million, reflecting a net change of $3.289 million (including the net impact of other financing sources and uses such as transfers and proceeds from the issuance of debt).
• The fund balance of the General Fund was large enough to allow for partial implementation of the City Council approved reserve policies, funding the 25% Economic Uncertainties Commitment ($18 million). • General Fund total revenues, including transfers in and proceeds from the sale of assets as June 30, 2024, was $92.605 million. Excluding other financing sources and uses, General Fund revenue was $74.028 million. The City recorded funds of $11.911 million from the issuance of debt related to the citywide solar project. • The General Fund expenditures as of June 30, 2024 were $88.459 million, excluding transfers out of $.857 million.
• The Transit enterprise fund ended Fiscal Year 2023-24 with a total net position of $56.417, a $5.405 million increase from the prior fiscal year.
• The City’s Hilton Garden Inn ended the fiscal year with a net position of $1.368 million, an improvement of $.741 million from FY 2022-23. The operating income (revenues exceeding expenses) was $.812 million as of June 30, 2024.
• The Home2Suites ended the fiscal year with a net position of $.395 million, a decrease of $.154 million versus FY 2022-23. The hotel had operating income (revenue exceeding expense) of $3.411 million as of June 30, 2024.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
8 These Financial Highlights, as well as other points, are discussed in greater detail in the body of this discussion and analysis, as well as the Notes to the Financial Statements. The following pages provide greater, in-depth detail on Government-wide financials, as well as Governmental and Business-type activities.
Government-wide Financial Analysis
The government-wide financial statements provide both long-term and short-term information about the City's overall financial position. This analysis addresses the financial statements of the City as a whole. The statement of net position includes all of the City’s assets, deferred outflows of resources, liabilities and deferred inflows of resources. The City’s net position is a useful measurement of its financial health. Net position can be tracked over time to assess whether the City’s financial health is improving or deteriorating. However, readers will need to consider other nonfinancial factors, such as changes in the City’s property tax base, the condition of the City’s infrastructure, and the level of public safety services to assess the overall health of the City.
The table below is the “Statement of Net Position,” and provides net position information broken out by Governmental and Business-type activities, with totals and a comparison to amounts as of June 30, 2024:
As mentioned in the “Financial Highlights” section above, the City’s total net position was $49.879 million as of June 30, 2024, a decrease of $18.741 million compared to the net position of $68.620 million in FY 2022-23. Total assets decreased by $10.697 million ($543.525 million from $554.222 million). 2024 2023 2024 2023 2024 2023
Assets:
Current and other assets $ 202,184 $ 232,917 $ 50,100 $ 73,947 $ 252,284 306,864$ Capital assets 150,159 124,673 141,082 122,685 291,241 247,358 Total assets 352,343 357,590 191,182 196,632 543,525 554,222 Deferred outflows of resources 33,837 39,839 8,483 10,071 42,320 49,910 Liabilities:
Long-term liabilities 295,288 278,859 126,572 131,149 421,860 410,008 Other liabilities 15,057 20,082 16,872 21,741 31,929 41,823 Total liabilities 310,345 298,941 143,444 152,890 453,789 451,831 Deferred inflows of resources 80,787 81,621 1,390 2,060 82,177 83,681 Net Position:
Net investment in capital assets 77,702 82,184 70,383 47,367 148,085 129,551 Restricted 49,619 80,555 11,850 23,767 61,469 104,322
Unrestricted (132,273) (145,872) (27,402) (19,381) (159,675) (165,253) Total net position $ (4,952) $ 16,867 $ 54,831 $ 51,753 $ 49,879 $ 68,620 City of Montebello
Statement of Net Position
June 30
(in thousands)
Governmental Activities Business-type Activities Total
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
9 The City uses capital assets to provide services to residents and the community at large; consequently, these assets are not available for future spending. Although the City's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. Any remaining amount is restricted to spending agreements originated by law, contract, or other agreements with external parties. Highlights of the key elements impacting the City’s net position for the fiscal year ended June 30, 2024, are as follows:
• Governmental Activities total expenses exceeded revenues including transfers by $5.685 million ($111.833 million in revenue vs. $117.518 million in expenses).
• Business-type Activities total revenues including transfers exceeded total expenses by $3.077 million ($65.917 million in revenues vs. $62.840 million in expenses).
• Total Citywide expenses before transfers were $180.358 million, an increase of approximately $14.623 million compared to the preceding fiscal year; with $1.519 million of the year-over-year increase in Public Works and an additional $9.523 million increase from the prior year in Public Safety (i.e., Police and Fire). • Total Citywide revenues as of June 30, 2024 including transfers were $177.750 million, a decrease of $25.793 million compared to June 30, 2023. Capital Grants decreased $21.009 million and Charges for Services decreased $19.139 million versus FY 2022-23.
• Revenues are classified into program and general revenues. Total program revenues (Governmental and Business-type activities combined) were approximately $121.334 million which are used to offset program expenses under each functional activity and are comprised of charges for services, operating and capital grants. • Governmental Activities General revenues of approximately $54.353 million are used to offset the additional expenses net of program revenues and are comprised primarily of taxes (i.e., property, sales, franchise, etc.), but includes investment income and transfers.
• The overall decrease of 14.51% in total revenues ($25.793 million) for the City was primarily due to decreases in Capital Grants ($21.009 million) and Charges for Services ($19.139 million), offset by a $5.483 million increase in investment earnings.
• The largest City-wide revenues came from several sources: charges for services (e.g. business license fees, building permits, hotel charges and bus fares) at $42.319 million, operating grants and contributions (e.g. allocations of funds derived from Los Angeles County Metropolitan Transportation Authority Local Return Funds Propositions A and C, and Measures R and M) at $71.449 million, sales taxes at $25.658 million and property taxes ($8.704 million).
• Revenue from charges for services decreased by $19.139 million (45.23%), property tax increased by $1.453 million (16.69%) and other taxes increased 8.25% ($1.049 million). • Total citywide expenses increased by $14.623 million, the net impact of increases in Public Works ($1.519 million), General Government ($.816 million) Public Safety ($9.523 million) and Transit ($2.931 million); with a one-time reduction in Water ($2.393 million) as the Water Fund was closed out after the sale of the City’s water system in FY 2022-23.
• The cost of serving residents for the year (across Governmental and Business-type Activities) includes: $61.478 million for public safety (police and fire); $25.070 million for public works; $41.323 million for transit (Montebello Bus Lines); $13.099 million in general government; and $4.921 million for parks, recreation and culture.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
10 The “Summary of Changes in Net Position” table below provides additional detail on changes to revenues, expenses and net position for the years ending June 30, 2024, and 2023. 2024 2023 2024 2023 2024 2023
Revenues
Program revenues:
Charges for services $ 19,748 $ 21,475 $ 22,571 $ 39,983 $ 42,319 $ 61,458 Operating grants and contributions 35,241 33,204 36,208 31,412 71,449 64,616 Capital grants and contributions 491 1,466 7,075 27,109 7,566 28,575 General revenues:
Sales taxes 25,658 26,352 - - 25,658 26,352
Property taxes 8,704 7,251 - - 8,704 7,251
Other taxes 12,711 11,661 - - 12,711 11,661
Other revenues 741 511 - - 741 511
Investment earnings 6,539 2,146 2,063 973 8,602 3,119
Total revenues 109,833 104,066 67,917 99,477 177,750 203,543 Expenses
General government 13,099 12,283 - - 13,099 12,283
Public safety 61,478 51,955 - - 61,478 51,955
Public works 25,070 23,551 - - 25,070 23,551
Parks, recreation, and culture 4,921 4,736 - - 4,921 4,736 Housing and community development 3,779 3,707 - - 3,779 3,707 Transit - - 41,323 38,392 41,323 38,392
Golf course - - 4,051 3,249 4,051 3,249
Montebello Hilton - - 5,963 5,945 5,963 5,945
Home2suites - - 11,503 11,157 11,503 11,157
Water - - - 2,393 - 2,393
Interest on long-term debt 8,470 7,666 - - 8,470 7,666
Unallocated infrastructure depreciation 701 701 - - 701 701 Total expenses 117,518 104,599 62,840 61,136 180,358 165,735 Change in net position before transfers (7,685) (533) 5,077 38,341 (2,608) 37,808 Transfers 2,000 16,291 (2,000) (16,291) - -
Change in net position after transfers (5,685) 15,758 3,077 22,050 (2,608) 37,808 Change in net position after transfers (5,685) 15,758 3,077 22,050 (2,608) 37,808 Net position - beginning of year, as restated 734 1,109 51,753 29,703 52,487 30,812 Net position - end of year $ (4,951) $ 16,867 $ 54,830 $ 51,753 $ 49,879 $ 68,620 City of Montebello
Summary of Changes in Net Position
(in thousands)
Governmental Activities Business-type Activities Total
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
11 Governmental Activities
• As reflected in the Statement of Activities schedule above, Governmental activities decreased the City's total net position (after transfers) by $5.685 million, and Business-type activities increased net position by $3.077 million, combining to decrease total net position by $2.608 million vs. June 30, 2023.
Key factors of this change in governmental activities include the following:
Revenues:
The pie chart below shows the relative percentage each major category of revenue (program and general) comprises of the $109.833 million in total Governmental Activities revenue. • Total governmental activities revenues increased by $5.767 million (5.25%). This is mainly due to increases in these revenue categories: Investment Earnings ($4.393 million), Operating Grants and Contributions ($2.037 million) and Property Taxes ($1.453 million).
• Operating Grants and Contributions (e.g. allocations of funds derived from Los Angeles County Metropolitan Transportation Authority Local Return Funds Propositions A and C, and Measures R and M) represent
32.09% of Governmental Activities revenue.
• Sales tax revenues were the second largest portion of total governmental activities revenues (23.36%). Sales tax revenues decreased by $.694 million, to $25.658 million as of June 30, 2024. • Charges for services were the third largest source of revenue for governmental activities (17.98%). Charges for services in governmental funds include licenses and permits, fines and forfeitures, waste collection, etc.
Compared to the prior fiscal year, this program revenue decreased by approximately $1.727 million, or
8.75%.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
12 Expenses
The cost of providing all governmental activities in 2024 was $117.518 million, an increase in expenses of $12.919 million (10.99%) when compared to June 30, 2023. There were increases and decreases to different categories, causing the overall net increase. Public Safety increased the most ($9.523 million, 52.31%), followed by a $1.519 million increase in Public Safety, and $.816 million increase in General Government.
Program revenues of $55.480 million offset a portion of the $117.518 million in Governmental Activities expenses, with general revenues used to offset $47.073 million of governmental activities expenses considered “public benefit.” This portion of expenses is funded by general revenues – which are primarily derived from taxes (i.e., sales, property, transient occupancy, etc.).
Business-type Activities
The City operates the following business-type activities: Transit System (i.e., Montebello Bus Lines), Golf Course, Hilton Garden Inn and Home2Suites. The City’s Transit System is the largest business-type operation (as defined by operating expenses), followed by Home2Suites, the Hilton Garden Inn and the Golf Course.
Business-type activities increased the City’s net position after transfers by $3.088 million, primarily a result of revenue (without transfers) exceeding expenses by $5.086 million ($67.916 million vs. $62.830 million).
Total revenues for business-type activities were $67.916 million, compared to $99.477 million in the previous fiscal year, constituting a 48.47% decrease ($31.661 million). The overall change is due to a $20.035 million decrease in Capital Grants and Contributions and a $17.412 million decrease in Charges for Services.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
13 The pie chart below shows the ratio that various program revenues comprise of the total amount of Business-type Activities revenue. Approximately 33.23% of revenue came from Charges for Services, which was generated from bus fares, special contracts, and revenue from hotel room fees, while the remaining 66.77% comes from State and Federal subsidies in the form primarily of Transit related grants and related revenue from Federal, State and local (i.e., Los Angeles County Metropolitan Transportation Authority) agencies.
Business-type Activities expenses increased $1.704 million in FY 2023-24 when compared to the prior fiscal year ($62.840 million versus $61.136 million). The pie chart below shows the composition that each operation comprises of total Business-type expenses:
Charges for
services
33.23%
Operating grants
and contributions
53.31%
Capital grants and
contributions
10.42%
Investment
earnings
3.04%
Business-Type Revenue
FY 2023-24
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
14 • The Transit System reported operating revenues of $38.552 million, a $5.061 million increase (13.13%) when compared to FY 2022-23. There were increases in Federal and State transit assistance ($2.635 million) and Local Return Funds ($2.426 million) funding. Operating expenses in FY 2023-24 were $38.645 million, a $1.657 million increase from the prior fiscal year. The majority of this increase ($3.698 million) was in Contractual Services. Net position increased by $5.405 million. • The Hilton Garden Inn reflected operating net income of $.812 million, comparable to the $.833 million surplus in FY 2022-23. The net income (surplus) is attributable to the recovering economy and the return of leisure and business travelers, leading to a direct increase in total occupancy. Operating revenues were very little changed year over year at $6.546 million, and operating expenses were also relatively flat at $5.734 million. Total change in net position was a positive $.740 million, contribution to ending net position of $1.368 million as of June 30, 2024.
• The Montebello Home2Suites reflected operating net income of $3.411 million, a slight decrease from FY 2021-22 of $442 thousand. Operating revenue was $13.039 million, a decrease of $.743 million vs. the prior fiscal year. As the economy recovers from the pandemic, a return to leisure and business travel has positively impacted the hotel’s operations. Total net position decreased by $.154 million, resulting in an ending net position of $.395 million as of June 30, 2024.
• The City’s Golf Course was closed for renovation from September 2022 through April 2024. The complete re-imagining of the Golf Course resulted in a new layout with two course: a 9-hole and 6-hole (lighted) course. For FY 2023-24, the net operating loss was $2.138 million. This was primarily due to the fact that the course was open for only three months, and Contractual Services (i.e., engineering, architectural, design) expenses related to the Golf Course renovation and Clubhouse construction were charged to this fund.
Governmental Funds Financial Analysis (Reporting the City’s most Significant Funds) Governmental Funds. The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information may be useful in assessing the City's financing requirements, in particular, unassigned fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year.
As of June 30, 2024, the City's governmental funds (i.e., major funds such as the General Fund, Retirement Fund, Local Return Funds, etc.) reported total combined ending fund balances of $111.094 million, a decrease of $22.921 million as compared with the prior fiscal year. All governmental fund balances are either non-spendable, restricted, committed, assigned, or unassigned pursuant to GASB 54.
Non-spendable indicates they are fund balances tied to inventories, prepaid expenses and property held for sale. The restricted fund balance category includes amounts that can be spent only for the specific purposes stipulated by constitution, external resource providers, or through enabling legislation. These restrictions of fund balance are to indicate that portions of fund balance are not available for new spending, because they have already been committed to 1) finance Special Revenue Fund expenditures, 2) pay debt service, or 3) finance ongoing capital projects.
Amounts in the committed fund balance are constrained for specific purposes that are internally imposed by the government through formal written action of the City Council. Amounts in the assigned fund balance classification are intended to be used by the government for specific purposes but do not meet the criteria to be classified as restricted or committed. The City has designated committed or assigned fund balances as of June 30, 2024 per the City Council approved General Fund reserve policies (see next paragraph for further explanation). Unassigned fund balance is the residual classification for the government’s general fund and includes all spendable amounts not contained in the other classifications.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
15 It should be noted that updated comprehensive reserve policies were originally adopted by the City Council in June 2020 and have been presented for formal adoption as part of the budget process every fiscal year since. These reserve policies created commitments and assignments in line with GASB 54, detailing specific uses for the commitments or assignments such as “Economic Uncertainty” or “Capital Projects.” These new policies, and the assignment of portions of the General Fund’s fund balance, have been partially implemented as of June 30, 2024. A Commitment for Economic Uncertainties ($18 million) has been made. Should future fund balances grow, additional designations per the reserve policies will be made per the City Council adopted policy.
The General Fund is the City's main operating fund. It is used to account for revenues and expenditures necessary to perform basic government functions that are not accounted for through other special revenue and grant funds. These are the typical services residents see daily: police and fire service, street maintenance, community services programming, code enforcement, park maintenance, etc.
The table below presents a comparison of General Fund revenues, expenditures, and fund balance. The General Fund saw an increase in fund balance of $3.289 million. Fund Balance is now 42.90% of Operating Revenues.
The key factors positively impacting fund balance of the General Fund for FY 2023-24 are as follows:
• General Fund operating revenues (i.e., taxes, charges for services, licenses and permits, etc.) increased by $1.945 million (2.70%) from the prior year, which is primarily due to the overall increase in property tax ($2.049 million), Investment Income ($1.411 million) and Franchise Taxes ($.436 million). • The increase to Property Tax reflects continued improvement in overall assessed value in the City, as well as additions to total assessed value with completed residential construction in Metro Heights and other smaller developments within the City.
• General Fund expenditures increased year-over-year by $11.923 million (15.58%). The largest year-overyear increases in operating expenses were Public Works ($4.135 million), General Government $.697 million million) and Public Safety ($5.763 million).
2024 2023 Amount %
Operating revenues $ 74,028 $ 72,080 $ 1,948 2.63%
Operating expenditures 88,459 76,593 11,866 13.41%
Excess of revenues over (under) expenditures (14,431) (4,513) (9,918) 68.73% Net operating transfers 5,809 16,995 (11,186) -192.56%
Proceeds from issuance of debt 11,911 - 11,911 100.00%
Proceeds from capital lease/sale of assets - 1,271 (1,271) -100.00% Surplus 3,289 13,753 (10,464) -318.15%
Beginning fund balance 28,467 14,716 13,751 48.31%
Ending fund balance $ 31,756 $ 28,467 $ 3,289 10.36%
City of Montebello
General Fund
As of June 30
(in thousands)
Change
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
16 • Expenses related to the citywide solar project ($6.951 million) contributed to the year-over-year increase in Public Works expenditures, offset by salary and benefit savings in operating divisions. • Expenses related to salaries, benefits (including special pays) and overtime in Police and Fire contributed to the year-over-year increase, $2.174 million in regular salaries and overtime in the Police Patrol Division and $.366 in Overtime expenditures in the Fire Suppression Division. • The Police Headquarters rehabilitation project contributed $.946 million in expenses in FY 2023-24.
The table below provides detail of General Fund revenue by major category for FY 2023-24:
Variance
with Final
Budget
2024 Positive
Original Final Actual (Negative)
Revenues
Sales taxes 26,085$ 26,085$ 25,658$ $ (427)
Property taxes 15,613 15,613 17,374 1,761
Other taxes 625 625 666 41
Franchise taxes 3,055 3,055 3,450 395
Licenses and permits 7,241 7,241 7,544 303
Fines and forfeitures 2,952 2,952 3,034 82
Investment income 350 350 1,626 1,276
Intergovernmental 15 15 4,856 4,841
Charges for services 8,857 8,857 9,099 242
Proceeds from sale of property - - - -
Other revenue 726 692 719 27
Total revenues $ 65,519 65,485$ 74,026$ $ 8,541
Budgeted Amounts
City of Montebello
General Fund
As of June 30
Retirement Fund is reserved for the payment of retirement expenses (both Normal Cost and Unfunded Accrued Liability) for all employees of the City. The Retirement Fund is financed by the retirement portion of the property tax revenue (i.e., property tax override) pursuant to a 1946 voter approved initiative to provide for the retirement benefit costs of City employees. The City’s Retirement Fund increased its fund balance by $5.010 million as of June 30, 2024, to a total of $30.426 million. The largest expense is the $12.062 million in Transfers Out related to the reimbursement of General Fund pension costs and payment of debt service on the $153.4 million in Pension Obligation Bonds issued in June 2020. The expenses related to pension costs (General Fund) and debt service (Debt Service Fund) are recognized as non-Operating Expenses (i.e., Transfers Out).
Transportation and Street Improvement Fund category is used to account for the activity of Los Angeles County Metropolitan Transportation Authority (Metro) Local Return Funds and State of California Gas Tax funds. This is a relatively new presentation of these funds which began for the financial statements as of June 30, 2023, combining activity to better illustrate the revenue and expenses related to street and roads funds. During the year ended June 30, 2024, fund balance increased by $6.485 million. Capital Outlay expenses of $.321 million were $6.844 million less than FY 2022-23, reflecting fewer capital projects completed in FY 2023-24. This reduction in operating expenses led to the growth in fund balance year-over-year.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
17 Public Financing Authority Debt Service Fund is used to account for the accumulation of resources required for the payment of interest and principal on all revenue bonds issued by the Public Financing Authority. As of June 30, 2024, fund balance decreased $1.033 million – from $8.347 million to $7.314 million. This fund is designed to act as a conduit for payment of debt service: Non-Operating Transfers Out expenses (principal and interest charges) generally equal Non-Operating Transfers In (revenue).
Capital Asset and Debt Administration
Capital Assets
The City's capital assets for its governmental and business-type activities as of June 30, 2024 amounted to $291.241 million, net of accumulated depreciation, a $43.88 million increase over the prior year. Capital assets include land, buildings, improvements, machinery and equipment, park facilities, roads, highways, and bridges. The table below provides a year-over-year comparison of capital assets (net of depreciation), broken out by Governmental Activities and Business-type Activities:
2024 2023 2024 2023 2024 2023
Land $ 3,413 $ 3,413 $ 6,272 $ 6,272 $ 9,685 $ 9,685
Rights of way 14,392 14,392 - 14,392 - 14,392
Construction in progress 30,303 32,647 46,891 27,193 77,194 59,840 Buildings and improvements 95,653 52,254 65,791 68,253 161,444 120,507 Machinery and equipment 8,040 7,346 22,128 20,967 30,168 28,313 Infrastructure (1,642) 14,621 - (1,642) - 14,621
$ 150,159 $ 124,673 $ 141,082 $ 122,685 $ 291,241 $ 247,358 City of Montebello
Summary of Capital Assets, Net of Depreciation
As of June 30
(in thousands)
Governmental Activities Business-type Activities Total
The capital asset classes include:
• Sewer system, including sewer pipes, pumping stations, manholes, and laterals; • Storm drain system, including storm drainpipes, flood control channels, and catch basins; • Streets, including pavement, curb and gutter, sidewalks, medians, greenways, block walls and traffic signals; • Buildings, including building remodels, building lighting systems, building equipment, and building roofs; and
• Parks, including associated structures and infrastructure assets.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
18 Long-Term Liabilities
At the end of Fiscal Year 2023-24, the City had total debt outstanding of $392.930 million, an increase of $10.309 million compared to the prior year. This increase is from the addition of a new notes payable related to the citywide solar project. This notes payable item added $14.351 million across Governmental and Business-type activities.
The outstanding debt includes $162.869 million of revenue bonds and $132.310 million of pension obligation bonds.
Claims payable of $34.695 million is a $3.277 million increase over the prior year. Compensated absences also increased, by $2.832 million, for a total of $10.944 million. The City’s Other Postemployment Benefit Obligation (OPEB) amount – as determined by the updated GASB 75 valuation – decreased by $.169 million to $29.980 million from $30.149 million.
The table below provides an overview and comparison of the various types of long-term liabilities:
2024 2023 2024 2023 2024 2023
Revenue bonds, net 82,177 $ 84,643 $ 80,692 $ 83,485 $ 162,869 $ 168,128 $ Pension bonds, net 100,990 97,023 35,287 36,730 132,310 137,720 Claims payable 34,695 31,418 34,695 - 31,418
Notes payable 16,843 5,782 4,012 722 20,855 6,504
Capital lease obligation 888 590 389 - 1,277 590
Compensated absences 9,136 6,678 1,808 1,434 10,944 8,112 Other postemployment
benefits obligation 26,180 26,755 3,800 3,394 29,980 30,149 Sub total 266,942 256,856 125,988 125,765 392,930 382,621 Less current portion 19,098 16,883 5,556 4,854 24,654 21,737 Noncurrent portion 247,844 $ $ 239,973 $ 120,432 $ 120,911 $ 368,276 $ 360,884 City of Montebello
Summary of Long-term Debt
As of June 30
(in thousands)
Governmental Activities Business-type Activities Total
Additional information on the City's long-term debt can be found in Note 7 to the basic financial statements section of this report.
Credit Rating
As of the date of this ACFR, the City S&P issuer credit rating (ICR) is “A+”, with the underlying credit rating on the City’s outstanding lease revenue bonds is “A”, with a “stable” outlook. These latest ratings were reaffirmed when the City issued $15.140 million in Lease Revenue Bonds, Series 2022A – Golf Course in September, 2022, which have been utilized to refurbish and reconstruct the City’s public golf course. The outlook for all ratings is “stable.” It should be noted that the “A+” ICR reflects S&P’s view of the City’s general creditworthiness.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
19 Organizational and Economic Overview
The financial statements and commentary found in prior ACFR’s has been dominated by the impacts of the Coronavirus pandemic. For the results as of June 30, 2024, these impacts have disappeared and there appears to be a return to “prepandemic” economic and financial activity – albeit tempered by relatively high inflation which impacts interest rates on home mortgages, vehicle financing, credit card debt, etc. Overall, the local Montebello economy appears to be healthy, as evidence by continued strong sales and transaction and use tax performance, as well as positive property tax revenue. Also, the City’s two hotels are performing well, seeing occupancy rates at or near levels last seen prepandemic (i.e., 2019).
For most of FY 2023-24, the discussion surrounding the economy focused on inflation, and the various causes of the generationally high inflation rate and methods used by the Federal Reserve to temper its impacts on the economy.
Hand-in-hand with the inflation discussion have been discussions of whether the Federal Reserve can pull off a “softlanding” and prevent the U.S. economy from sliding into a recession. As of the publication of this ACFR, it appears the Federal Reserve’s reduction in the Federal Funds Rate, coupled with falling inflation and steady job growth have combined to – at least for now – avert an economic downturn.
For this and other reasons, it is imperative that Montebello’s economic development activities promote projects that expand the City’s sales tax and property tax base. Looking ahead, there is much to be excited about in Montebello in these arenas, with several projects begun prior to FY 2023-24 that will contribute to the City’s long-term economic health and viability once completed in the near future.
The issuance of $15.140 million in lease revenue bonds in September, 2022 (LRB Series 2022A) has ushered in a new era for the City’s public golf course, with the re-opening occurring in April, 2024. These proceeds have been used to completely reconstruct the existing golf course, creating a championship 9-hole course, a 6-hole “executive” course, and adding lights for the ability to play golf during evening hours. This project will help the Golf Course reduce – even eliminate – the subsidy required from the General Fund. Shortly after the golf course re-opened, the new Clubhouse was completed and opened to the public in October, 2024.
Connected to the Golf Course Renovation Project is the Topgolf facility, constructed on 15 acres of the existing golf course property. Topgolf opened to the public in May, 2024. This project is funded with the $55.4 million in lease revenue bonds issued in December, 2022 (LRB Series 2022B). In a unique financing arrangement, the Public Financing Authority issued the bonds, with a sub-lease and guaranty tied to the issuance that requires Topgolf to pay the annual debt service (i.e., improvement rent). The completed Topgolf facility is a three-story entertainment and event center, featuring 102 hitting bays, a restaurant, meeting space and a pro shop. In addition to the commitment to pay annual debt service, Topgolf pays an annual lease for the use of City property ($1.150 million for the first five years, with increases every five years after). In addition, the facility will generate sales tax revenue, which will help boost overall General Fund revenue.
In addition to these exciting capital projects and economic development initiatives completed in FY 2023-24, the City finally received approval from the Public Utilities Commission (PUC) to sell its water system. The PUC decision was finalized in December 2022, and escrow closed in February 2023. The sale of the water system to San Gabriel Valley Water Company (SGVWC) concludes a long saga of the City attempting to sell its water system. The State Auditor, in its December 2018 report, recommended the City pursue the sale, and the October 2021 follow up report noted this recommendation and continued to support the sale. The City received $15.857 million in proceeds from the sale, which was recorded as non-operating revenue in the General Fund in FY 2022-23, positively impacting reserves. In addition, the City will receive annual water rights lease payments as condition of the sale of the water system.
As noted in the preceding pages, the General Fund’s fund balance increased by $3.289 million, to $31.756 million as of June 30, 2024. The fiscal year ending June 30, 2024 allows for partial implementation of the reserve policies approved by City Council in June 2020. One Commitment – Economic Uncertainties has been reserved in fund balance. Details on General Fund reserve classifications can be found in Note 13.
City of Montebello
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
20 In FY 2023-24, the City continued critical work related to upgrading its information technology and cybersecurity infrastructure. This project has been funded using a portion of the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) revenue the City received between May 2021 and 2022. The total $16.59 million in CSLFRF revenue received by Montebello has been categorized as “revenue loss,” as permitted by U.S. Treasury Interim Final and Final Rules. This much needed funding has allowed the City to fast-track the technology upgrade, improving security, storage and productivity hardware and software. This funding has also repaired and improved the City’s sewer infrastructure and provided funding for public safety (i.e., Police and Fire) salaries and benefits.
These are just a few highlights of the many projects underway in Montebello that are aimed at improving residents’ lives and helping to put the City on a long-term path to financial stability and sustainability. Some other projects that either began or were continued into FY 2023-24 are the following:
Completion of the transformation of the City’s public golf course – a re-opened Bella Verde Golf Course (Spring 2024) that provides an improved golfing experience for the community. Opening of the 100th Topgolf Entertainment Complex in Spring 2024 – transforming 15 acres of the former golf course into a destination site.
Continued growth in revenue from the three-quarter cent sales tax measure (Measure H), approved by 62% of Montebello’s voters in March 2020.
Continued progress in upgrading the City’s streets and roadways through use of $25 million in bond funding for the “Paving the Way” program.
Approval of an updated General Plan, the first such endeavor since 1973. Upgraded the City’s vehicle fleet, purchasing replacement vehicles for Police, Public Works and Fire. Expanded community programs with a season-long Farmer’s Market, Night Market, Pet Vaccine Clinics, a summer street-fest, and other resident favorite programs. Significant progress toward completion of an affordable housing project in downtown Montebello (6th Street) developed by the Cesar Chavez Foundation.
Continued progress towards completion of 1,200 housing units as part of the Metro Heights development. Significant upgrades to the City’s Police Department headquarters building, an investment of $1.25 million in facility and equipment improvements.
Management and the City Council continue to be dedicated to improving Montebello’s long-term financial sustainability. Pursuing projects that are externally and internally focused – capital and infrastructure projects as well as organizational improvements – will strengthen Montebello’s abilities to weather changes in the economy as well as the “next pandemic,” in whatever form that may appear.
Requests for Information
This financial report is designed to provide a general overview of the City's finances for all those with an interest in the government's finances. Questions concerning any of the information provided in this report can be answered by visiting the City’s website at www.montebelloca.gov.
ITEM # 18
CITY OF MONTEBELLO
CITY COUNCIL AGENDA STAFF REPORT
TO: Honorable Mayor and City Council Members
FROM: Raul Alvarez, City Manager
BY: Michael Solorza, Director of Finance
SUBJECT: ANNUAL APPROVAL OF CITY'S INVESTMENT POLICY FOR FISCAL YEAR 2025-26
DATE: June 25, 2025
RECOMMENDATIONS:
It is recommended that the City Council:
1. Adopt Resolution No. 25-49 approving the Investment Policy Statement for the City and Successor Agency as required by Government Code Section 53601 et al; and,
2. Take such additional, related action that may be desirable.
FISCAL IMPACT:
Approval of the updated Investment Policy Statement has no immediate fiscal impact. State Government Code requires an annual review and approval of the investment policy by a City’s governing body, even if no changes are made to the policy.
The attached policy incorporates recent changes in allowed investments, per applicable Government Code sections. The table of allowed investments in the Investment Policy (Attachment B) indicates the recent changes and provides the applicable Government Code for each type of allowable investment. Staff are bringing the policy for City Council review and approval to align it with the annual budget development and adoption.
BACKGROUND/DISCUSSION:
State Government Code requires cities to have a City Council approved investment policy that guides the investment of idle cash. The policy is intended to provide specific criteria for the prudent investment of City and Successor Agency funds. The ultimate goal of the
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
policy is to enhance the economic status of the City while protecting funds under management and meeting daily cash flow needs.
The City of Montebello has an investment policy statement most recently reviewed, approved and updated on June 12, 2024 (and prior to that, August 19, 2019, October 28, 2020, June 23, 2021, June 8, 2022, June 14, 2023). Government Code requires an annual review and approval of the investment policy statement – even if no changes are made. The 2019 approval was the first time the City’s investment policy was updated since 2011, with a previous update done in 2007. The irregular nature of review and updating of the policy required a much more thorough updating in October, 2020. Since then, each annual update has beenroutine, as the review process is aligned on an annual basis and coincides with budget review and adoption.
The updated version of the City’s investment policy was submitted to the California Municipal Treasurers Association (CMTA) for consideration of their investment policy review and award program in 2020. The CMTA investment policy program utilizes public treasury officials to review public agency policies to ensure they comply with best practices and Government Code. For the first time in the City’s history, the City’s policy was submitted and passed the review with flying colors. Having passed this review process is one more indication of the progress made in achieving fiscal sustainability in Montebello.
The policy (Attachment B) fully incorporates Government Code Section 53601 et al allowable investments. There are minor changes to the policy related to additional investments allowed, updates since the policy was last reviewed and approved and which are governed by various Government Code references. In addition, the Investment Committee is being disbanded. This committee has not met regularly since 2019. Furthermore, even though it can have up to seven (7) members, that threshold has never been met. Also, since the pandemic, the committee has rarely had sufficient members to muster a quorum (minimum of 3). Currently, there are no Investment Committee members. The city has an elected Treasurer who provides sufficient oversight. In addition, the Director of Finance maintains daily operational management of the City’s investment portfolio.
ENVIRONMENTAL:
N/A
ANALYSIS:
N/A
SUMMARY:
The City Council is being asked to adopt a resolution approving the Investment Policy Statement of the City and Successor Agency. This approval continues the annual investment policy consideration so that it occurs annually in June.
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
ATTACHMENT(S)
1. Attachment A - Resolution Investment Policy Update 06_25_2025
2. Attachment B - City Montebello FY 2025_26 Investment Policy
ATTACHMENT A
RESOLUTION NO. 25-49
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MONTEBELLO ADOPTING AN INVESTMENT POLICY STATEMENT
FOR THE CITY AND SUCCESSOR AGENCY
RECITALS
WHEREAS, State Government Code Section 53646(a) sets guidelines for how local officials should submit an investment policy; and, WHEREAS, Government Code requires the investment policy to be considered, reviewed and approved annually at a public meeting; and, WHEREAS, the Investment Policy Statement of the City and Successor Agency was last reviewed and considered by the City Council on 12, 2024; and
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF MONTEBELLO HEREBY RESOLVES, FINDS, AND DECLARES AS FOLLOWS:
SECTION 1. Investments of City funds shall be made in accordance with the Investment Policy Statement attached hereto as Exhibit A and made part hereof.
SECTION 2. The policies adopted by this resolution are in addition to and supplement any other legal requirements.
SECTION 3. The City Treasurer and/or Director of Finance shall deliver a copy of the Investment Policy Statement to any and all financial institutions which hold City and/or Successor Agency funds and investments.
SECTION 4: That the City Clerk shall certify to the passage and adoption of this Resolution and that the same shall be in full force and effect.
APPROVED AND ADOPTED THIS 25TH DAY OF JUNE 2025.
_______________________________
Salvador Melendez, Mayor
RESOLUTION NO. 25-49
ATTEST: APPROVED AS TO FORM:
________________________________ ________________________________ Christopher Jimenez, City Clerk Arnold M. Alvarez-Glasman, City Attorney
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS:
CITY OF MONTEBELLO )
I, Christopher Jimenez, City Clerk of the City of Montebello, County of Los Angeles, State of California, hereby certify that the foregoing Resolution No. 25-49 was passed and adopted by the City Council of the City of Montebello, signed by the Mayor and attested by the City Clerk at a regular meeting of said Council held on the 25th day of June, 2025 and that said Resolution was adopted by the following vote, to-wit:
AYES:
NOES:
ABSTAIN:
ABSENT:
The undersigned, City Clerk of the City of Montebello, does hereby attest and certify that the foregoing Resolution is a true, full and correct copy of a resolution duly adopted at a meeting of said City which was duly convened and held on the date stated thereon, and that said document has not been amended, modified, repealed or rescinded since its date of adoption and is in full force and effect as of the date hereof.
DATE:
Christopher Jimenez, City Clerk
City and Successor Agency
Montebello
Investment Policy
Fiscal Year 2025-26
Adopted by City Council
June 2025
ATTACHMENT B
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Investment Policy Statement
Adopted June 12, 202425,2025
City/Successor Agency of Montebello
Investment Policy
TABLE OF CONTENTS
Introduction ....................................................................................................................2 Scope .............................................................................................................................2 Delegation of Authority ...................................................................................................2 Ethics and Conflicts of Interest .................................................................................... 2 Prudence/Prudent Investor Standard .......................................................................... 2 Internal Controls .......................................................................................................... 3 Investment Objectives ................................................................................................. 3 Performance Evaluation .............................................................................................. 3 Diversification .............................................................................................................. 3 Portfolio Segregation ................................................................................................... 4 Bond Issuance Arbitrage Rebate ..................................................................................4 Qualified Dealers ......................................................................................................... 4 Safekeeping of Securities ..............................................................................................4 Collateralization ........................................................................................................... 5 Maximum Maturities ......................................................................................................5 Investment Pools/Money Market Mutual Funds .......................................................... 5 Authorized and Suitable Investments ............................................................................6 Ineligible Investments ....................................................................................................9 Fiscal Accountability and Investment Committee ........................................................ 9 Portfolio Reporting ........................................................................................................9 Review of Investment Portfolio .................................................................................. 10 Investment Policy Adoption ........................................................................................ 10 Glossary ................................................................................................................... 11
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Investment Policy Statement
Adopted June 12, 202425,2025
1. INTRODUCTION
This Statement of Investment Policy (“Investment Policy” or “Policy”) is intended to provide specific criteria for the prudent investment of City and Successor Agency funds. The ultimate investment goal is to enhance the economic status of the City while protecting funds under management and meeting the daily cash flow demands of the City and Successor Agency. This investment policy has been prepared in conformance with all pertinent existing laws of the State of California including California Government Code Sections 53600, et seq. (NOTE: throughout this Policy, it is understood that any reference to “City” is inclusive of the “Successor Agency.”)
2. SCOPE
This investment policy applies to all of the City's idle cash invested in various vehicles and encompasses all monies under the direct oversight of the City Treasurer and Director of Finance and include the General Fund, Reserve Funds, Special Revenue Funds, Debt Service Funds, Capital Project Funds, Permanent Fund, Proprietary Funds, Trust and Agency Funds, including the Successor Agency to the Dissolved Montebello Redevelopment Agency, and any other funds that may be created.
These funds are accounted for in the City of Montebello’s Comprehensive Annual Financial Report (CAFR).
3. DELEGATION OF AUTHORITY
Authority to manage the City of Montebello’s investment program is derived from California Government Code Section 53601 et al. The authority of the City Council to invest or reinvest monies of the City has been delegated by the City Council to the City Treasurer and Director of Finance until such time the delegation is revoked. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the Director of Finance.
4. ETHICS AND CONFLICTS OF INTEREST
Officers and employees involved in the investment process shall refrain from personal business activity that conflicts with proper execution of the investment program or that impairs their ability to make impartial investment decisions. Employees and investment officials shall disclose any material financial interests that could be related to the performance of the City's investment policy annually with the California Fair Political Practices Commission or as necessary under the Political Reform Act and Government Code Section 1090 et seq.
5. PRUDENCE/PRUDENT INVESTOR STANDARD
The City's pooled investment program operates under the Prudent Investor Standard, Government Code Section 53600.3, and applicable State laws. When investing, reinvesting, purchasing, acquiring, exchanging, selling, and managing public funds, responsible/delegated officials shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the City, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the City.
Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired and sold as authorized by law. This affords a broad spectrum of investment opportunities so long as the investment is deemed prudent and permissible by the State of California, various bond indentures and this policy. It is the goal of officials so authorized under this Policy to strive to invest 100 percent of idle funds.
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6. INTERNAL CONTROLS
The Director of Finance and/or his/her designee shall establish procedures that separate the internal responsibility for management and accounting of the investment portfolios. An analysis by an external independent auditor shall be conducted annually to review internal controls, account activity and compliance with policies and procedures.
7. INVESTMENT OBJECTIVES
The City's cash management system is designed to accurately monitor and forecast revenues and expenditures, thus enabling funds to be invested to the fullest extent possible. A diversified portfolio is maintained to accomplish the primary objectives in the order of safety, liquidity, and yield.
Safety: The safety/risk associated with an investment refers to the potential loss of principal, accrued interest or a combination of these. Credit risk is mitigated by monitoring financial institutions with which he/she will do business, and by careful scrutiny of the credit worthiness of the investment instruments as well as the institutions. Such resources as nationally recognized statistical-rating organization (NRSRO) services are utilized for this review. Mitigation of interest rate risk is sought through diversification of instruments as well as maturities.
Liquidity: The portfolio will be structured with sufficient liquidity to allow the City to meet anticipated cash requirements. This will be accomplished through the purchase of a diversity of instruments to include those with active secondary markets, those that can match maturities to expected cash needs, and the State Local Agency Investment Fund (LAIF) with immediate withdrawal provisions.
Yield: A competitive market rate of return is the third objective of the investment program after the fundamental requirements of safety and liquidity have been met. The portfolio shall be managed to consistently attain a market rate of return throughout budgetary and economic cycles. Whenever possible, and consistent with risk limitations and prudent investment management, the City will seek to augment returns above the market average rate of return through the implementation of active portfolio management strategies.
8. PERFORMANCE EVALUATION
Investment performance is continually monitored and evaluated by the City. Investment portfolio reports are generated on a monthly and quarterly basis and submitted to the City Council, City Manager, and Investment Committee. A quarterly Treasurer’s report is also presented to the City Council and Investment Committee.
9. DIVERSIFICATION
The City will diversify use of investment instruments to avoid unreasonable risks inherent in over-investing in specific instruments, individual financial institutions, or maturities.
Market price volatility shall be controlled through maturity diversification, as well as ensuring adequate liquidity is available to meet cash flow requirements, thereby precluding the need to sell instruments at a market loss.
Risk of default will be controlled by acquiring instruments such as Government Securities, or by diversifying the portfolio within the constraints and parameters of Section 17 of this Policy, Authorized and Suitable Investments.
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10. PORTFOLIO SEGREGATION
Within the overall funds managed, bond proceeds held by fiscal agents or trustees shall also be segregated and invested in accordance with each indenture.
The primary purpose of any separately managed bond proceeds is to structure investment maturities to meet current and future liabilities. The preservation of principal and the maintenance of liquidity are the most important factors regarding the investment of bond proceeds. Portfolio yield is not a primary factor since the portfolio structure, eligible investment assets and maturity restrictions are governed by draws and expenditure schedules of the issues. Performance will be based upon maximizing permitted positive arbitrage within the context of principal preservation as a first priority (pre-1986 Tax Reform Act issuances) or minimizing or eliminating negative arbitrage (yield-restricted issues).
11. BOND ISSUANCE ARBITRAGE REBATE
The U.S. Tax Reform Act of 1986 requires the City to perform annual arbitrage calculations and rebate excess earnings to the U.S. Treasury for investment returns that exceed the allowable interest earnings limit of each bond issue. The arbitrage calculation process must be conducted for the investment of proceeds of bond issues sold after the effective date of this law. This arbitrage calculation will be contracted out to provide the necessary technical expertise to comply with this regulation. The City's investment position relative to the interest rate arbitrage restrictions is to have safety and the highest permitted return the law allows as the highest priority while ensuring the preservation of principal and liquidity.
12. QUALIFIED DEALERS
The City shall transact business only with Registered Investment Advisors, national or state-chartered banks, savings and loans, and broker dealers. The dealers should be primary dealers regularly reporting to the New York Federal Reserve Bank, or approved regional or secondary market dealers that qualify under the Securities and Exchange Commission Rule 15C3-1 (uniform net capital rule).
Authorized officials of the City may direct a fiscal agent or trustee to execute investment transactions on behalf of the City for funds held by that fiscal agent or trustee.
The City will monitor broker/dealers and their firms to ensure they are in good standing with the appropriate regulatory agencies.
13. SAFEKEEPING OF SECURITIES
To protect against losses caused by the collapse of individual securities dealers, all securities owned by the City, including collateral for repurchase agreements, shall be held in safekeeping by a third party bank trust department acting as agent for the City under the terms of a custody agreement or, in the case of funds held by the fiscal agent or trustee, the fiscal agent or trustee shall segregate and report securities held on the City's behalf. Any trade executed by a dealer is required to settle on a delivery versus payment basis with the City's safekeeping agent.
Fiscal agents or trustees in receipt of City of Montebello bond proceeds will settle security transactions on a delivery versus payment method based upon instructions provided by the authorized City official or the City's investment advisor. The fiscal agents or trustees will issue monthly custodian statements evidencing securities held in safekeeping, including the receipt of interest and maturity proceeds, the disbursement of funds for the purchase of securities, and the receipt of any sale proceeds.
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14. COLLATERALIZATION
All demand deposits, time deposits and repurchase agreements are to be fully collateralized with securities authorized by the California Government Code and the City.
The cost value (book value) of collateral pledged for demand deposits must at all times be equal to or greater than the amount on deposit, plus accrued interest, in accordance with the following ratio:
o U.S. Treasury Securities: 110%
The cost value (book value) of collateral pledged for repurchase agreements must at all times be equal to or greater than the par amount, plus accrued interest, with the following ratios:
o U.S. Treasury Securities: 102%
o U.S. Government Agencies: 102%
It is the policy of the City to require reports at least on a quarterly basis from institutions with which the City has pledged security interest. The adequacy of collateralization shall be monitored to ensure that balances are collateralized in accordance with the ratios approved herein.
With regard to repurchase agreements, it is the policy of the City to initiate a margin call in the event pledged collateral falls below the appropriate ratio. Collateralized investments and deposits often require substitution of collateral. Any broker or financial institution requesting substitution must contact the City for approval in the event the counterparty to the transaction is not authorized under agreement with the City to make substitutions.
15. MAXIMUM MATURITIES
In accordance to California Government Code Section 53601, The City will not invest in any securities maturing more than five (5) years from the settlement date of purchase. If there is a desire to make investments longer than five years, express authority to make those investments, either specifically or as part of an investment program, must be approved by the City Council no less than three months prior to the investment.
16. INVESTMENT POOLS/MONEY MARKET MUTUAL FUNDS
A thorough investigation of any government sponsored pool and/or mutual fund is required prior to investing and on a continual basis. There shall be a questionnaire completed which will provide the following information:
• A description of eligible investment securities, and a written statement of investment policy and objectives.
• A description of interest calculations and how it is distributed, and how gains and losses are treated.
• A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited. • A description of who may invest in the program, how often and what size of deposits and withdrawals are allowed.
• A schedule for receiving statements and portfolio listings.
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Investment Policy Statement
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• A description of how the pool/fund utilizes reserves, retained earnings, etc. • A fee schedule, including when and how fees are assessed. • The eligibility of the pool/fund to invest in bond proceeds and special district funds, and a description of its practices.
17. AUTHORIZED AND SUITABLE INVESTMENTS
The City is governed by the California Government Code, Sections 53600 et seq. Within the context of these limitations and based on the cost at the time of purchase, the following investments are authorized:
INVESTMENT TYPE MAXIMUM
MATURITY
MAXIMUM
SPECIFIED %
OF PORTFOLIO
MINIMUM QUALITY
REQUIREMENTS
GOVERNMENT
CODE
SCTIONS
U.S. Treasury
Obligations 5 years None None 53601(b)
U.S Agency
Obligations 5 years None None 53601(f)
State Obligations— CA
And Others 5 years None None 53601(d)
CA Local Agency
Obligations 5 years None None 53601(e)
Local Agency Bonds 5 years None
‘A” rating category or its
equivalent or betterNone 53601(a)
Bankers’ Acceptances 180 days 40% None 53601(g)
Commercial Paper—
Non-Pooled Funds
(under $100 million of
investments)
270 days or less
25% of the
Agency's
Money
Highest letter and
number rating by an
NRSROH
53601(h)(2)(C)
Commercial Paper—
Non-Pooled Funds
(minimum $100 million
of investments)
270 days or less
40% of the
Agency's
Money
Highest letter and
number rating by an
NRSROH
53601(h)(2)(C)
Commercial Paper—
Pooled Funds 270 days or less
40% of the
Agency's
Money
Highest letter and
number rating by an
NRSROH
53635(a)(1)
Negotiable Certificates
of Deposit 5 years 30% None 53601(i)
Non-negotiable
Certificates of Deposit 5 years None None 53630 et seq.
Placement Service
Deposits 5 years 50% None 53601.8 and 53635.8
Placement Service
Certificates of Deposit 5 years 50% None 53601.8 and 53635.8 Repurchase
Agreements 1 year None None 53601(j)
Reverse Repurchase
Agreements and
Securities Lending
Agreements
92 days
20% of the base
value of the
portfolio
None 53601(j)
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Investment Policy Statement
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Medium-Term Notes 5 years or less 30% “A” rating category or its equivalent or better 53601(k)
Mutual Funds And
Money Market Mutual
Funds
N/A 20% Multiple 53601(l) and
53601.6(b)
Collateralized Bank
Deposits 5 years None None 53630 et seq. and 53601(n)
Mortgage
Pass–Through and
Asset–Backed
Securities
5 years or less 20% “AA” rating category or its
equivalent or better 53601(o)
County Pooled
Investment Funds N/A None None 27133
Joint Powers Authority
Pool N/A None Multiple 53601(p)
Local Agency
Investment Fund
(LAIF)
N/A None None 16429.1
Voluntary Investment
Program Fund N/A None None 16340
Supranational
Obligations
5 years or less 30% “AA” rating category or its
equivalent or better
53601(q)
Public Bank
Obligations 5 years None None
53601(r),
43635(c ) and
57603
A. United States Treasury Obligations: Bills, Bonds, and Notes, or those for which the full faith and credit of the United States are pledged for payment of principal and interest. There is no limitation as to the percentage of the portfolio that can be invested in this category.
B. United States Agency Obligations: Issued by United States Federal agencies or government-sponsored enterprise obligations, or other instruments, including those issued by or fully guaranteed as to principal and interest by Federal agencies or United States government-sponsored enterprises. Although there is no percentage limitation on these issues, the "prudent investor" standard shall apply to investments from a single agency.
C. State Obligations (California/Other States) and California Local Agency Obligations:
Registered state warrants or treasury notes or bonds of the State of California or any of the other 49 states and bonds, notes, warrants or other evidences of indebtedness of any local agency within California, including bonds payable solely out of the revenues from a revenue producing property owned, controlled or operated by the state or local agency or by a department, board, agency or authority of the state or local agency.
D. Local Agency Bonds: Includes bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by the local agency or by a department, board, agency, or authority of the local agency rated “A” or better by a NRSRO.
E. Bankers’ Acceptances: If purchased may not exceed 180 days to maturity or 40 percent of the cost (book) value of the portfolio. No more than 5 percent of the cost (book) of the portfolio may
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be invested in Bankers’ Acceptances issued by any one bank. Prior to the purchase of any Banker’s Acceptance, the portfolio manager shall review the rating of the issuing bank. Bankers’ Acceptances of issuing financial institutions shall have both a short and long term rating in the highest category by at least one nationally recognized rating agency at the time of purchase.
F. Commercial paper (Pooled and Non-Pooled Funds): Ranked of "prime" quality of the highest ranking or of the highest letter and number rating as provided for by NRSRO and issued by a domestic corporation having assets in excess of $500 million. The commercial paper must also have an “A” or better rating for the issuer’s debt, other than commercial paper, if any, as provided by a NRSRO. Purchase of commercial paper from corporations on negative credit watch by a major rating agency shall be prohibited. Purchases of eligible commercial paper may not exceed 270 days to maturity. Local agencies with less than one hundred million dollars ($100,000,000) of investments under management may invest no more than 25% in eligible commercial paper. Whereas, agencies having one hundred million dollars ($100,000,000) or more may invest no more than 40% in eligible commercial paper.
G. Negotiable and Non-Negotiable Certificates of Deposit (including Placement Service Deposits/Certificates of Deposit): Negotiable Certificates of Deposit are limited to 30% of the City’s monies which may be invested, with no maximum limit for Non-Negotiable Certificates of Deposit. Placement Service Deposits/Certifications of Deposit have a limit of 50% of the portfolio.
H. Repurchase agreements: The City may invest in repurchase agreements with banks and primary dealers with whom the City has entered into a master repurchase agreement that specifies terms and conditions of repurchase agreements. The maturity of repurchase agreements shall not exceed 365 days. In order to conform with provisions of the Federal Bankruptcy Code which provides for the liquidation of securities held as collateral for repurchase agreements, the only securities acceptable as collateral shall be securities that are direct obligations of, or that are fully guaranteed as to principal and interest by, the United States Government such as Treasury bills, Treasury notes or Treasury bonds with less than a five year maturity.
I. Reverse repurchase agreements/Securities Lending Agreements: The City may invest in reverse repurchase agreements only with those banks and primary dealers with whom the City has entered into a master repurchase agreement outlining terms and conditions of repurchase and reverse repurchase agreements.
J. Corporate medium term notes: Issued by a domestic corporation having an “A” or better rating criteria at time of purchase on its long-term debentures as provided by a NRSRO. The aggregate total of all purchased medium term notes may not exceed 30 percent of the cost value of the portfolio. No more than 5 percent of the cost value of the portfolio may be invested in corporate medium term notes issued by any one corporation. Commercial paper and bankers’ acceptance holdings shall be considered when calculating the maximum percentage in any issuer name.
K. Mutual Funds/Money market mutual funds: Having a rating of “AAA” or an equivalent by no less than two NRSRO with no load and maintained at $1 par value. No more than 20 percent of the cost value of portfolio value at time of purchase should be invested in this category, and the City's investment in any specific mutual fund will not exceed 10 percent of that mutual fund's total assets.
L. Mortgage Pass-through and Asset Backed Securities: A mortgage pass-through security,
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collateralized mortgage obligation, mortgage-backed or other pay-through bond, equipment lease-backed certificate, consumer receivable pass-through certificate, or consumer receivable-backed bond. Securities eligible for investment under this subdivision shall be rated in a rating category of “AA” or its equivalent or better by an NRSRO and have a maximum remaining maturity of five years or less. Purchase of securities authorized by this subdivision shall not exceed 20 percent of the agency’s surplus moneys that may be invested pursuant to this section.
M. County Pooled and/or Joint Powers Authority Investment Funds: The city may invest in a joint powers authority organized pool that invests in the securities and obligations authorized in 53601(a) to (q) inclusive. There is no limitation as to the percentage of monies that can be invested in either a County or Joint Powers Authority pool N. Local Agency Investment Fund: The City may invest in the LAIF established by the State Treasurer for the benefit of local agencies up to the maximum permitted by State law.
N.O. Voluntary Investment Program: This fund is created within the State Treasury for the receipt of voluntary deposits. The minimum deposit into this fund is $200,000,000 (two hundred million dollars).
P. Supranational Obligations: Securities of United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank, with a maximum remaining maturity of five years or less, and eligible for purchase and sale within the United States. Investments under this subdivision shall be rated “AA” or better by an NRSRO and shall not exceed 30 percent of the agency’s moneys that may be invested pursuant to this section.
O.Q. Public Bank Obligations. Notwithstanding Section 53601, any local agency that does not pool money in deposits or investments with other local agencies that have separate governing bodies may invest in debt securities or other obligations of a public bank.
Notwithstanding Section 53635, any local agency that pools money in deposits or investments with other local agencies, including local agencies that have the same governing body, may invest in debt securities or other obligations of a local public bank. This investment option sunsets on January 1, 2026.
18. INELIGIBLE INVESTMENTS
Investments not described herein including, but not limited to, equity securities such as common stocks, preferred stocks, convertibles, inverse floaters, range notes and interest-only strips that are derived from a pool of mortgages are prohibited from use in this portfolio. The City is prohibited from entering into a margin agreement and/or borrowing on margin.
19. FISCAL ACCOUNTABILITY AND INVESTMENT COMMITTEE
The City Council will appoint a Fiscal Accountability and Investment Committee composed of seven (7) City of Montebello residents, with the City Treasurer and Director of Finance (or his/her designee) serving as ex officio members.
Each City Councilmember will appoint one person to the committee, making up five (5) of the seven (7)
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total members. The terms of Committee members chosen in this manner will coincide with that of the appointing City Councilmember or at such time the appointing City Councilmember makes a subsequent appointment.
The additional two (2) members will be appointed by majority vote of the entire City Council. The terms of Committee members chosen in this manner will be four (4) years with the term commencing on the date the appointment is approved by a majority of the City Council and ending four (4) years from that date or at such time a majority of City Councilmembers make a subsequent appointment.
All members, regardless of the method of appointment, may serve multiple, consecutive terms.
The committee will meet at a minimum quarterly to review, monitor and make recommendations with respect to the City’s investment program, as well as meet the requirements of the Measure H Transaction and Use Tax Ordinance, Section 19, Accountability which requires an annual review of the expenditure of the proceeds of Measure H. A registered investment advisor may be appointed by the City Council to serve as advisor to the Committee and the City Council. 2019. PORTFOLIO REPORTING
In accordance with California Government Code, Sections 53607 and 53646(b), the Director of Finance shall provide on a monthly and quarterly basis an investment portfolio report to the City Council. The quarterly report shall be presented to the City Council no later than sixty (60) days from the end of the prior quarter.
The report shall include a listing of each of the City's investments (a description that adequately describes the security), the purchase date, maturity date, cost basis, current cost value (book value), interest rate, weighted average maturity, current unrealized loss or gain and a listing of investment transactions that includes purchase/deposit and sale/withdrawal activity. Various investment types will be categorized and grouped in the same structure as the qualified investment categories identified in this policy. The portfolio report shall include a statement certifying the ability of the City to meet its expenditure requirements for the next six months or provide an explanation as to why sufficient money shall, or may, not be available.
The investment portfolio report shall include market value information for all investments. A monthly market value will be obtained for each security owned by the City. For purposes of reporting, the market value of each security may be obtained from the City’s custodian bank or other pricing source(s) utilized by the City’s designated investment management firm (registered investment advisor).
The City shall record interest revenue on a modified accrual basis of accounting that is typical for reporting and recording of interest earnings. Securities held by a fiscal agent or trustee shall also be recorded on a modified accrual basis of accounting. The Director of Finance will report year-end investments in conformance with Governmental Accounting Standards Board (GASB) Statement Nos. 31, 40, and 72 and all current and relevant GASB pronouncements in effect. .
2120. REVIEW OF INVESTMENT PORTFOLIO
The securities held by the City must be in compliance with Section 17, Authorized and Suitable Investments, at the time of purchase. A quarterly review of investments will be done to identify any securities that are no longer in compliance.
2221. INVESTMENT POLICY ADOPTION
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Investment Policy Statement
Adopted June 12, 202425,2025
The City Council shall review and adopt this Investment Policy by resolution annually.
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Investment Policy Statement
Adopted June 12, 202425,2025
GLOSSARY
AGENCIES – Agencies of the Federal government set up to supply credit to various classes of institutions (e.g., S&L's, small business firms, students, farmers, housing agencies, etc.) Examples include Federal Home Loan Mortgage Corporation (FHLMC), Federal National Mortgage Association (FNMA), Federal Home Loan Bank (FHLB), and Federal Farm Credit Bank (FFCB).
ASSET BACKED SECURITIES - Securities supported by pools of installment loans or leases or by pools of revolving lines of credit.
ASK/OFFER – The price at which securities are offered. (The price at which a firm will sell a security to an investor)
BANKERS’ ACCEPTANCE (BA) – A draft or bill of exchange accepted by a bank or trust company.
The accepting institution guarantees payment of the bill as well as the issuer.
BASIS POINT – One one-hundredth of a percent (i.e., 0.01 percent)
BEAR MARKET – A period of generally pessimistic attitudes and declining market prices.
BID PRICE – The price at which a broker/dealer will buy securities from an investor.
BOND EQUIVALENT YIELD – The basis on which yields on notes and bonds are quoted.
BOOK VALUE (COST VALUE) – The purchase price of the security as recorded on the City’s books.
BROKER – An individual or firm acting as intermediary by purchasing and selling securities for others.
BULL MARKET – A period of generally optimistic attitudes and increasing market prices.
CALLABLES – Securities that the issuer has the right to redeem prior to maturity.
CERTIFICATE OF DEPOSIT (CD) - A time deposit with a specific maturity evidenced by a certificate.
Large denomination CD's are typically negotiable.
CMT – Constant Maturity Treasury – An index of the average yield on United States Treasury securities adjusted to a constant maturity.
COLLATERAL – Securities, evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.
COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR) - The official annual financial report of the City. It includes combined statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP). It also includes supporting schedules necessary to demonstrate compliance with finance-related legal and contractual provisions, extensive introductory material, and a detailed Statistical Section.
CORPORATE MEDIUM TERM NOTE – A security issued by a corporation doing business in the U.S. with a maturity not to exceed five years.
COST VALUE (BOOK VALUE) – The purchase price of the security as recorded on the City’s books.
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Investment Policy Statement
Adopted June 12, 202425,2025
COUPON – a) The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value; b) a certificate attached to a bond evidencing interest due on a payment date.
DEALER – An individual or firm acting as principal in a security transaction.
DEBENTURE - A bond secured only by the general credit of the issuer.
DELIVERY VS PAYMENT - Delivery of securities with a simultaneous exchange of money.
DEMAND ACCOUNT – An account with a commercial bank from which check withdrawals may be made at any time.
DERIVATIVES – Financial products that are dependent for their value on (or derived from) an underlying financial instrument, a commodity, or an index representing values of groups of such instruments or assets.
DISCOUNT – The difference between the cost price of a security and its par value when the cost is lower than par. A security selling below original offering price shortly after sale also is considered to be at a discount.
DIVERSIFICATION – Dividing investment funds among a variety of securities offering independent returns.
FEDERAL FUNDS RATE – Interest rate charged by one institution lending federal funds to another.
FEDERAL OPEN MARKET COMMITTEE (FOMC) – Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member, while the other presidents serve on a rotating basis.
The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.
FINANCIAL ADVISOR – A firm or bank that acts in a financial advisory capacity with respect to a new issue of municipal securities pursuant to a written contract.
FISCAL AGENT – A financial institution which performs payment of principal and interest to bondholders, and certain administrative duties on the bond issuer’s behalf.
GOVERNMENTAL ACCOUNTING STANDARDS BOARD – The independent organization that establishes and improves standards of accounting and financial reporting for U.S. state and local governments.
INTERNAL RATE OF RETURN – Rate of return over the life of a security on variables.
LOCAL AGENCY INVESTMENT FUND (LAIF) – The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment and reinvestment.
MARKET VALUE – The price at which a security is trading, usually the liquidation value.
MASTER REPURCHASE AGREEEMENT – A written contract covering all future transactions between the parties to repurchase-reverse repurchase agreements that establishes each party’s rights in the
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Investment Policy Statement
Adopted June 12, 202425,2025
transactions. A master agreement will often specify, among other things, the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller borrower.
MONEY MARKET MUTUAL FUNDS – Open-ended mutual fund that invests in commercial paper, banker’s acceptances, repurchase agreements, government securities, certificates of deposit and other highly liquid and safe securities, and pays money market rates of interest. The fund’s net asset value remains a constant $1 a share, with the interest rate increasing or decreasing.
MORTGAGE PASS-THROUGH SECURITIES – A securitized participation in the interest and principal cash flows from a specified pool of mortgages. Principal and interest payments made on the mortgages are passed through to the holder of the security.
NATIONALLY RECOGNIZED STATISTICAL RATING ORGANIZATION (NRSRO) – A rating organization designated by the SEC as being nationally recognized.
OFFER PRICE – The price at which a broker/dealer will offer securities to an investor.
OPEN MARKET OPERATIONS – Federal Reserve activity. Under the Federal Reserve Act, the Fed uses purchases and sales of Government and Federal Agency securities to add to or subtract from commercial bank reserves. Goals are to sustain economic growth, high employment and reasonable price stability.
PAPER GAIN OR LOSS – Term used for unrealized gain or loss on securities being held in a portfolio based on comparison of current market quotes and their original cost. This situation exists as long as the security is held while there is a difference between cost value (book value) and the market value.
PORTFOLIO – Collection of securities held by an investor.
PREMIUM – The difference between the cost price of a security and its par value, when the cost is higher than par.
PRIMARY DEALER – A group of government securities dealers that serve as trading counterparties of the New York Fed in its implementation of monetary policy. This role includes the obligations to: (i) participate consistently in open market operations to carry out U.S. monetary policy pursuant to the direction of the Federal Open Market Committee (FOMC); and (ii) provide the New York Fed's trading desk with market information and analysis helpful in the formulation and implementation of monetary policy. Primary dealers are also required to participate in all auctions of U.S. government debt and to make reasonable markets for the New York Fed when it transacts on behalf of its foreign official accountholders.
RATE OF RETURN – The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity; on a bond, the current income return.
REPURCHASE AGREEMENT (REPO) – A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed price on a fixed date. The security “buyer” in effect lends the “seller” money for the period of the agreement, and the terms of the agreement are structured to compensate them for this.
REVERSE REPURCHASE AGREEMENT (REVERSE REPO) – A reverse-repurchase agreement (reverse repo) involves an investor borrowing cash from a financial institution in exchange for securities. The investor agrees to repurchase the securities at a specific date for the same cash value plus an agreed upon interest rate. Although the transaction is similar to repo, the purpose of entering
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Investment Policy Statement
Adopted June 12, 202425,2025
into a reverse repo is quite different. While a repo is a straightforward investment of public funds, the reverse repo is a borrowing.
SAFEKEEPING – The service provided by banks and trust companies for clients when the bank or trust company stores the securities, takes in coupon payments, and redeems issues at maturity.
SECURITIES & EXCHANGE COMMISSION (SEC) - Agency created by Congress to protect investors in securities transactions by administering securities legislation.
SEC RULE 15(C) 3-1 – See Uniform Net Capital Rule.
SPREAD – a) The yield or price difference between the bid and offer on an issue; b) the yield or price difference between different issues.
SUPRANATIONALS – International institutions formed by two or more governments that transcend boundaries to pursue mutually beneficial economic or social goals. There are three supranational institutions that issue obligations that are eligible investments for California local agencies: the International Bank for Reconstruction and Development (IBRD), International Finance Corporation (IFC), and Inter-American Development Bank (IADB).
SWAP – The sale of one issue and the simultaneous purchase of another for some perceived advantage.
TREASURY BILLS – A non-interest bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months or one year.
TREASURY BONDS – U.S. Treasury securities that have initial maturities of more than 10 years.
TREASURY NOTES – Intermediate-term coupon bearing U.S. Treasury securities having initial maturities from one year to ten years.
TRUSTEE – A financial institution with trust powers that acts in a fiduciary capacity for the benefit of the bondholders in enforcing the terms of the bond contract.
UNIFORM NET CAPITAL RULE – Securities and Exchange Commission requirement that member firms as well as nonmember broker-dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities. Liquid capital includes cash and assets easily converted into cash.
WHEN ISSUED BASIS (WI) – A term applied to securities that are traded before they are actually issued with the stipulation that transactions are null and void if securities are not issued.
YIELD CURVE – Yield calculations of various maturities at a given time to observe spread difference.
YIELD TO MATURITY – The current coupon yield minus any premium above par, or plus any discount from par in the purchase price with the adjustment spread over the period from date of purchase to maturity.
ITEM # 19
CITY OF MONTEBELLO
CITY COUNCIL AGENDA STAFF REPORT
TO: Honorable Mayor and City Council Members
FROM: Raul Alvarez, City Manager
BY: John Soria, Director
SUBJECT: ADOPT RESOLUTION NO. 25-40 AUTHORIZING THE CITY OF
MONTEBELLO TO APPLY FOR FEDERAL TRANSIT
ADMINISTRATION (FTA) FUNDING UNDER THE LOW OR NO
EMISSION GRANT PROGRAM AND THE GRANTS FOR BUSES AND
BUS FACILITIES PROGRAM TO SUPPORT MONTEBELLO BUS
LINES’ ZERO-EMISSION BUS FACILITIES AND FLEET TRANSITION PLAN
DATE: June 25, 2025
RECOMMENDATIONS:
It is recommended that the City Council:
1. Adopt Resolution No. 25-40 authorizing the City of Montebello to apply for Federal Transit Administration (FTA) funding under (i) the Low or No Emission Grant Program (Low-No Program) and (ii) the Grants for Buses and Bus Facilities Program (Bus and Bus Facilities Program) [collectively, hereinafter the “Grants”], in the amount of $18,653,940; and
2. Take such additional, related, action that may be desirable.
FISCAL IMPACT:
The City will submit an application to the Federal Transit Administration (FTA) in accordance with the Notice of Funding Opportunity (NOFO) guidelines (Attachment A) in the amount of $18,653,940 (total amount includes a required 20% non-Federal match amount), for funding under the FTA’s Low-No Program and Bus and Bus Facilities Program. If a project submitted for consideration under both programs is selected for funding, the FTA will exercise its discretion to determine under which program the project will receive an award.
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
These funding sources will assist with procuring a permanent hydrogen fueling station and three (3) fuel cell electric buses (FCEBs). All future procurement processes and budget appropriations required for both the hydrogen fueling station and the FCEBs will be presented to the City Council for review and approval as necessary at subsequent meetings.
BACKGROUND/DISCUSSION:
On October 27, 2021, the City Council adopted Resolution No. 21-80 approving Montebello Bus Lines’ (MBL) Zero Emission Bus (ZEB) Rollout Plan (Attachment B), which serves as a strategic blueprint for transitioning MBL’s entire fleet to zero-emission (ZE) technologies by 2040. The ZEB Rollout Plan outlines the necessary steps to address the current bus fleet composition, future vehicle procurement, infrastructure and facility upgrades, and identification of funding opportunities to support the transition.
On October 23, 2024, the City approved Agreement No. 4231 with the Center for Transportation and the Environment (CTE) to provide recommendations and guidance for activities specific to hydrogen fuel storage, monitoring, dispensing, fire suppression, and infrastructure modifications to existing facilities to accommodate daily fueling and maintenance. In addition, MBL has purchased three (3) hydrogen FCEBs, which are scheduled for delivery by the end of this calendar year. To support fueling operations in the interim, staff will release a Request for Proposal (RFP) in July 2025 for a temporary hydrogen fueling station until the permanent facility is fully operational.
In alignment with the ZEB Rollout Plan, MBL identified the FTA’s Low-No Program and Bus and Bus Facilities Program as key funding sources to support the permanent hydrogen fueling infrastructure. On May 14, 2025, the FTA released a NOFO, offering approximately $1.5 billion in FY 2025-26 funding under the Low-No Program and the Bus and Bus Facilities Program. These competitive Grants are designed to assist transit agencies adopt low or ZE technologies through the purchase of advanced equipment for transit operations.
The City is eligible to apply for funding under Section 5307 of Title 49, U.S. Code. If awarded, this funding will play a crucial role in helping MBL realize its ZE goals, while also reinforcing the City’s commitment to invest in innovative, cutting-edge technology required to support the sustainable electrification of transportation.
ENVIRONMENTAL:
N/A
ANALYSIS:
N/A
SUMMARY:
Staff recommend that the City Council adopt Resolution No. 25-40 (Attachment C)
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
authorizing the City to apply for FTA funding under the Low-No Program and the Bus and Bus Facilities Program, in the amount of $18,653,940 (total amount includes required 20% non-Federal match amount), to support MBLs ZE Bus Facilities and Fleet Transition Plan; and take such additional, related, action that may be desirable.
ATTACHMENT(S)
1. Attachment A – Federal Register Vol. 90 No. 93 Notice of Funding Opportunity
2. Attachment B – Resolution No. 21-80 approving MBL’s ZEB Rollout Plan
3. Attachment C – Resolution No. 25-40
Federal Register / Vol. 90, No. 93 / Thursday, May 15, 2025 / Notices 20737 Marine Mammal Protection Act [16
U.S.C. 1361–1423h], Anadromous Fish
Conservation Act [16 U.S.C. 757(a)–
757(f)]; Fish and Wildlife Coordination
Act [16 U.S.C. 661–667(d)]; Migratory
Bird Treaty Act (MBTA) [16 U.S.C. 703–
712]; Magnuson-Stevenson Fishery
Conservation and Management Act of
1976, as amended [16 U.S.C. 1801–
1891d], with Essential Fish Habitat
requirements [16 U.S.C. 1855(b)(2)].
6. Historic and Cultural Resources:
Section 106 of the National Historic
Preservation Act of 1966, as amended
[54 U.S.C. 3006101 et seq.];
Archaeological Resources Protection Act
of 1979 (ARPA) [16 U.S.C. 470(aa)–
470(II)]; Preservation of Historical and
Archaeological Data [54 U.S.C. 312501–
312508]; Native American Grave
Protection and Repatriation Act
(NAGPRA) [25 U.S.C. 3001–3013; 18
U.S.C. 1170].
7. Social and Economic: Civil Rights
Act of 1964 [42 U.S.C. 2000 d–2000d–
1]; American Indian Religious Freedom
Act [42 U.S.C. 1996]; Farmland
Protection Policy Act (FPPA) [7 U.S.C.
4201–4209].
8. Wetlands and Water Resources:
Clean Water Act (Section 319, Section
401, Section 404) [33 U.S.C. 1251–
1387]; Coastal Barriers Resources Act
(CBRA) [16 U.S.C. 3501–3510]; Coastal
Zone Management Act (CZMA) [16
U.S.C. 1451–1466]; Safe Drinking Water
Act (SDWA) [42 U.S.C. 300f–300j–26];
Rivers and Harbors Act of 1899 [33
U.S.C. 401–406]; Wild and Scenic
Rivers Act [16 U.S.C. 1271–1287];
Emergency Wetlands Resources Act [16
U.S.C. 3921, 3931]; Wetlands
Mitigation, [23 U.S.C. 119(g) and
133(b)(3)]; Flood Disaster Protection Act
[42 U.S.C. 4001–4130].
9. Hazardous Materials:
Comprehensive Environmental
Response, Compensation, and Liability
Act (CERCLA) [42 U.S.C. 9601–9675];
Superfund Amendments and
Reauthorization Act of 1986 (SARA);
Resource Conservation and Recovery
Act (RCRA) [42 U.S.C. 6901–6992(k)].
10. Executive Orders: E.O. 11990
Protection of Wetlands; E.O. 11988
Floodplain Management; E.O. 11593
Protection and Enhancement of Cultural
Resources; E.O. 13007 Indian Sacred
Sites; E.O. 13287 Preserve America; E.O.
11514 Protection and Enhancement of
Environmental Quality; E.O. 13112
Invasive Species.
(Catalog of Federal Domestic Assistance
Program Number 20.205, Highway Planning
and Construction. The regulations
implementing Executive Order 12372
regarding intergovernmental consultation on
Federal programs and activities apply to this
program.)
(Authority: 23 U.S.C. 139(l)(1)).
Issued on: May 8, 2025.
Karen M. Brunelle,
Director, Office of Project Development,
Federal Highway Administration.
[FR Doc. 2025–08601 Filed 5–14–25; 8:45 am]
BILLING CODE 4910–RY–P
DEPARTMENT OF TRANSPORTATION
Federal Transit Administration
FY 2025 Competitive Funding
Opportunity: Low or No Emission
Grant Program and the Grants for
Buses and Bus Facilities Competitive
Program
AGENCY: Federal Transit Administration
(FTA), Department of Transportation
(DOT).
ACTION: Notice of funding opportunity
(NOFO).
SUMMARY: The Federal Transit
Administration (FTA) announces the
opportunity to apply for $1.5 billion in
competitive grants for the Fiscal Year
(FY) 2025 Low or No Emission Grant
Program and FY 2025 Grants for Buses
and Bus Facilities Program.
DATES: Complete proposals must be
submitted electronically through the
GRANTS.GOV ‘‘APPLY’’ function by
11:59 p.m. Eastern time Monday, July
14, 2025.
FOR FURTHER INFORMATION CONTACT:
Email Kirsten Wiard-Bauer, Office of
Program Management, at
[email protected] or (202)
366–2053.
SUPPLEMENTARY INFORMATION: The full
text of the Notice of Funding
Opportunity (NOFO) can be found on
FTA’s website at https://www.transit.
dot.gov/funding/grants/notices and in
the ‘‘FIND’’ module of GRANTS.GOV.
The funding opportunity IDs are FTA–
2025–008–TPM–LWNO and FTA–2025–
007–TPM–BUS. Mail and fax
submissions will not be accepted.
Matthew J. Welbes,
Executive Director.
[FR Doc. 2025–08571 Filed 5–14–25; 8:45 am]
BILLING CODE P
DEPARTMENT OF THE TREASURY
Bureau of the Fiscal Service
Proposed Collection of Information:
Claims Against the United States for
Amounts Due in the Case of a
Deceased Creditor
ACTION: Notice and request for
comments.
SUMMARY: The Department of the
Treasury, as part of its continuing effort
to reduce paperwork and respondent
burden, invites the general public and
other Federal agencies to take this
opportunity to comment on proposed
and/or continuing information
collections, as required by the
Paperwork Reduction Act of 1995.
Currently the Bureau of the Fiscal
Service within the Department of the
Treasury is soliciting comments
concerning Claims Against the United
States for Amounts Due in the Case of
a Deceased Creditor.
DATES: Written comments should be
received on or before July 14, 2025 to be
assured of consideration.
ADDRESSES: Direct all written comments
and requests for additional information
to Bureau of the Fiscal Service, Bruce A.
Sharp, Room #4006–A, P.O. Box 1328,
Parkersburg, WV 26106–1328, or
[email protected].
SUPPLEMENTARY INFORMATION:
Title: Claims Against the United
States for Amounts Due in the Case of
a Deceased Creditor.
OMB Number: 1530–0004.
Form Number: SF–1055.
Abstract: The information is required
to determine who is entitled to funds of
a deceased Postal Savings depositor or
deceased award holder. The form
properly completed with supporting
documents enables the Judgement Fund
Branch to decide who is legally entitled
to payment.
Current Actions: Extension of a
currently approved collection.
Type of Review: Regular.
Affected Public: Business or other forprofit.
Estimated Number of Respondents:
400.
Estimated Time per Respondent: 27
minutes.
Estimated Total Annual Burden
Hours: 180.
Request for Comments: Comments
submitted in response to this notice will
be summarized and/or included in the
request for OMB approval. All
comments will become a matter of
public record. Comments are invited on:
1. Whether the collection of information
is necessary for the proper performance
VerDate Sep<11>2014 16:47 May 14, 2025 Jkt 265001 PO 00000 Frm 00119 Fmt 4703 Sfmt 4703 E:\FR\FM\15MYN1.SGM 15MYN1 khammond on DSK9W7S144PROD with NOTICES
ATTACHMENT B
October 27, 2021
Montebello Bus Lines
Zero Emission Bus Rollout Plan
2 TABLE OF CONTENTS
SECTION A: TRANSIT AGENCY INFORMATION........................................................................................... 3 SECTION B: ROLLOUT PLAN GENERAL INFORMATION.............................................................................. 4 SECTION C: TECHNOLOGY PORTFOLIO....................................................................................................... 5 FIGURE 1: Fleet Composition Over 20-Year Transition Period ................................................................. 6 SECTION D: CURRENT BUS FLEET COMPOSITION AND FUTURE BUS PURCHASES ................................... 7 TABLE 1: Bus Information for Current Bus Fleet....................................................................................... 7 FIGURE 2: Projected Annual Bus Procurements Fleet .............................................................................. 8 TABLE 2: Projected Annual Bus ZEB Procurement Details........................................................................ 9 TABLE 3: Verifying Block Achievability Throughout Fleet Transition...................................................... 11 TABLE 4: Estimated Costs of Future ZEB Purchases................................................................................ 11 SECTION E: FACILITIES AND INFRASTRUCTURE MODIFICATION............................................................. 12 FIGURE 3: Estimated Annual Infrastructure Costs.................................................................................. 13 TABLE 5: Facilities Information and Construction Timeline.................................................................... 14 TABLE 6: NOx-Exempt Area and Electric Utilities’ Territories................................................................. 15 SECTION F: PROVIDING SERVICES IN DISADVANTAGED COMMUNITIES (DACs).................................... 16 TABLE 7: Service in Disadvantaged Communities................................................................................... 17 SECTION G: WORKFORCE TRAINING........................................................................................................ 21 TABLE 8: Forecasted Personnel and Positions Training Requirements .................................................. 22 SECTION H: POTENTIAL FUNDING SOURCES............................................................................................ 23 SECTION I: START-UP AND SCALE-UP CHALLENGES................................................................................. 24 APPENDIX A: MBL SITE RENDERINGS ...................................................................................................... 26 APPENDIX B: DAC AND LOW-INCOME SERVICE MAP ............................................................................. 28
3 SECTION A: Transit Agency Information
1. Transit Agency’s Name Montebello Bus Lines
2. Mailing Address 400 S. Taylor Ave
Montebello, CA 90640
3. Name of Transit Agency’s Air
Districts South Coast Air Quality Management District
4. Name of Transit Agency’s Air Basin South Coast Air Basin
5. Total Number of Buses in Annual
Maximum Service 66
6. Population of Urbanized Area
Transit Agency Services (Last
Published by the Census Bureau as
of 2019)
520,344
7. Contact Information
Adrianna Kendricks
Acting Director of Transportation
(323)558-1625 ext. 201
[email protected]
8. Is your agency part of a Joint Group
(13 CCR§2023.1 (d) (3))? Yes☐ No☒
4 SECTION B: Rollout Plan General Information
1. Does your transit agency’s Rollout Plan have a goal of full transition to zero-emission technologies by 2040 that avoids early retirement of conventional transit buses (13 CCR § 2023.1(d)(1)(A))?
Yes.
2. The ICT regulation requires 100% ZEB purchase in 2029. Conventional transit buses that are purchased in 2028 could be delivered in or after 2029. Please explain how your transit agency plans to avoid potential early retirement of conventional buses in order to meet the 2040 goal.
Montebello Bus Lines (MBL) will begin purchasing zero-emission buses (ZEB) in the first quarter of 2023, and gradually purchase additional ZEBs through 2040. This purchasing strategy will coincide with the disposition of conventional transit buses at the end of their lifecycle expectancy. MBL does not intend to acquire additional non-ZEBs after 2023.
3. When did your transit agency's board or governing body approve the Rollout Plan? a. Rollout Plan's approval date: 10/27/2021
b. Resolution number: 21 - 80
c. Is a copy of the board approved resolution attached to the Rollout Plan submitted to CARB (13 CCR § 2023.1(d) (2))? Yes
4. Please provide contact information for CARB to follow up on details of the Rollout Plan, if needed.
a. Contact name: John Soria
b. Title: Transit Administration Manager
c. Phone Number: (323) 558-1625 ext.106
d. Email: [email protected]
5. Who assisted in creating the Rollout Plan?
MBL staff worked with bus manufacturing consultants and representatives to create a customized plan that considers MBL’s Current Bus Fleet Composition and Future Bus Purchases, Facilities and Infrastructure Modifications, Workforce Training, Potential Funding Sources, and Start-up and Scale-up Challenges.
5 SECTION C: Technology Portfolio
1. What type(s) of zero-emission bus technologies does your transit agency plan to deploy through 2040? (13 CCR § 2023.1(d)(1)(B))
MBL intends to deploy a complete fleet of Fuel Cell Electric Buses (FCEB). While Battery Electric Buses (BEBs) are also ZEBs with several notable configurations, MBL concluded that FCEBs are more efficient and better aligned with the transit agency’s operational needs. Key considerations used to identify the preferred option were performance and ease of implementation. FCEBs can accommodate larger energy demands over the BEBs. In addition, FCEB technology is operationally flexible during power outages and rolling blackouts.
According to bus manufacturer, New Flyer of America, Inc., FCEBs provide the following:
Long-range transit services of 350 miles without refueling. Refueling process between 8 – 20 minutes.
Increased bus life expectancy of 16 years (CNG – 12 years). Increased passenger load capacity of 82 (CNG – 62).
Further considerations were made regarding infrastructure needs for both types of ZEBs.
Deploying an FCEB fleet will not require significant changes to the current infrastructure and will provide long term cost savings when compared to a BEB fleet. Figure 1 illustrates MBL's plan to achieve a complete FCEB fleet by 2040. The procurement of FCEBs and the gradual development of MBL’s infrastructure to receive and support its new fleet will begin in 2023.
6 FIGURE 1: MBL’s FCEB Fleet Transition Schedule Over the next 20-Year Period 28 28 28 28 28 28 28 28 28 28 28 28 28 27
19 12
7 7
3 3 3 3 3 3 3 3 3
35 35 33 33
30 30
26 26
21 8 8 8
3 2 2
5 5
9 9
17 30 30 30
35 39
47 54
59 59
63 66
0 10
20 30
40 50
60 70
NUMBER OF BUSES
YEAR
FCEB FLEET TRANSITION SCHEDULE
CNG Electric HYBRID FCEB
7 SECTION D: Current Bus Fleet Composition and Future Bus Purchases Please complete Table 1 with information on each individual bus in your current bus fleet.
Table 1 represents MBL’s fleet as of the fourth quarter of 2021. Listed are vehicles that routinely operate in service, as well as a supporting contingency fleet.
TABLE 1: Bus Information for Current Bus Fleet
Series Model
Year
No. of
Buses Active/Non-Active Bus Type
Engine
Model
Year
Engine Serial
Number
Engine
Model Engine Family Fuel Type
SR952 2005 3 NON-ACTIVE New Flyer 2010 R07470255 FORD 5ISEC6.8HB UNLEADED/HYBRID SR1224 2008 11 ACTIVE New Flyer 2010 R07721220 FORD 9ISEH06.8HB UNLEADED/HYBRID SR1224 2008 3 ACTIVE New Flyer N/A N/A N/A N/A ELECTRIC SR1363 2009 8 ACTIVE New Flyer 2010 R07443458 FORD 9ISEH06.8HB UNLEADED/HYBRID SR1362 2009 16 ACTIVE New Flyer 2010 R07454955 FORD 9ISEH06.8HB UNLEADED/HYBRID SR1490 2011 3 ACTIVE New Flyer 2010 73165084 ISLG 280 ACEZH0540LBD CNG SR1570 2011 4 ACTIVE New Flyer 2011 73321795 ISLG 280 BCEXH0540LBG CNG SR1683 2013 8 ACTIVE New Flyer 2013 73504250 ISLG 280 DCEXH0540LBG CNG SR2049 2016 7 ACTIVE New Flyer 2016 74015640 ISLG 280 GCEXH0540LBG CNG SR2241 2018 5 ACTIVE New Flyer 2018 74263223 ISLG 280 JCEXH0540LBM CNG SR2524 2020 1 ACTIVE New Flyer 2020 74708434 L9N LCEXHO540LBM CNG
8 Please complete Table 2 regarding expected future bus purchases, including the number of buses in total expected to be purchased or leased in the year of purchase.
Identify the number and percentage of zero-emission buses of the total bus purchases each year, as well as bus types and fuel types. Identify the same type of information for purchases of conventional buses. Bus types include standard, articulated, over-the-road, double decker and cutaway buses. For zero-emission technologies, please identify the fuel type as hydrogen or electricity and the type of charging technology (depot, wireless, and/ or on-route). For conventional technologies, identify the fuel type as diesel, compressed natural gas (CNG), liquefied natural gas (LNG), diesel hybrid (dHEB), gasoline hybrid (gHEB), propane, or gasoline. (13 CCR § 2023.1(d) (1) (D)) Figure 2 illustrates a purchase forecast for MBL to acquire ZEBs while maintaining reliable service. The chart further demonstrates a projected schedule for MBL to fully convert to a ZEB fleet through procurement planning for future years. This process enables MBL to become familiar with the new technology and avoid service disruptions. In addition, the chart reflects the 12-year life span of the current fleet and the 16-year ZEB replacement plan beginning in 2023. Table 2 demonstrates MBL’s commitment to a 100% ZEB procurement planning process beginning in 2023. Years in which buses are not purchased are omitted from the table.
FIGURE 2: MBL’s Projected Annual FCEB Procurement
2 3
4 8
13 5
4 8
7 5
4 3
0 2
4 6
8 10
12 14
2023 2025 2027 2029 2030 2033 2034 2035 2036 2037 2039 2040
NUMBER OF BUSES PURCHASED
YEAR
Projected FCEB Procurements
9 TABLE 2: MBL’s Projected Annual ZEB Procurement Details Timeline
(Year)
Total
Number of
Buses to
Purchase
Number
of ZEB
Purchases
Percent of
Annual Bus
Purchases
ZEB Bus
Type(s)/ZEB Fuel
Type(s)
Number of
Conventional
Vehicles
2023 2 2
100% 40’ Standard FCEB /
Hydrogen 0
2025 3 3 100% 40’ Standard FCEB /
Hydrogen 0
2027 4 4 100% 40’ Standard FCEB /
Hydrogen 0
2029 8 8 100% 40’ Standard FCEB /
Hydrogen 0
2030 13 13 100% 40’ Standard FCEB /
Hydrogen 0
2033 5 5 100% 40’ Standard FCEB /
Hydrogen 0
2034 4 4 100% 40’ Standard FCEB /
Hydrogen 0
2035 8 8 100% 40’ Standard FCEB /
Hydrogen 0
2036 7 7 100% 40’ Standard FCEB /
Hydrogen 0
2037 5 5 100% 40’ Standard FCEB /
Hydrogen 0
2039 4 4 100% 40’ Standard FCEB /
Hydrogen 0
2040 3 3 100% 40’ Standard FCEB /
Hydrogen 0
10 Following the same bus purchase timeline as identified in Table 2, please identify in Table 3 the required operational range your future zero-emission buses should have to be able to serve in your fleet. Please provide the estimated cost of each bus with that required operational range.
Table 3 demonstrates consideration of the FCEBs achievable duty cycle and range based on the manufacturer’s specifications. One of MBL’s main reservations is the FCEBs ability to complete a full-service block without the need to refuel. An informal Line-by-Line analysis determined that the FCEB technology will generate adequate energy to provide reliable service for longer routes.
Within the first four years of the ZEB deployment, MBL will deploy nine FCEBs on three of its longest and busiest routes. In 2023, MBL will purchase two FCEBs to be deployed on Route 10.
This route is approximately 13 miles in each direction with an average of six trips per day.
Acknowledging the FCEBs 350 miles long-range capability, the buses will be expected to provide sufficient service without the need to refuel. After analyzing the performance of the first two FCEBs, MBL intends to deploy an additional three buses on Route 40 in 2025. The purchase and deployment of FCEBs on Route 10 and 40 will be to meticulously assess performance, efficiency, and identify any challenges. This strategic approach will assist MBL’s scalability efforts during the transition process from conventional to zero-emission (ZE) transit buses.
Route 50 is MBL’s longest route, covering 25.6 miles from 5th St/Beaudry Blvd to Adelfa Dr/Santa Gertrudes Blvd. While Route 50 is one of the most demanding and rigorous routes within MBL’s system, MBL anticipates a 100% block achievability. Initially, MBL will deploy four new FCEBs on Route 50 and gradually increase the number of buses on route. Using the same methodology, MBL will purchase additional FCEBs to be deployed on the remaining routes: 20, 30, 60, 70, and 90.
Table 4 shows the average cost of ZEBs available for purchase using the Washington State Transit Bus Cooperative Master Contract. Although alternative pricing options are available on this Master Contract, the illustrated price is the current cost of a transit FCEB manufactured by New Flyer of America, Inc. Table 4 also depicts MBL’s historic configurable options costs and the state sales tax.
11 TABLE 3: Verifying Block Achievability Throughout Fleet Transition Timeline
(Year)
Number of
FCEBs
in Fleet
Total Number of
Active Buses in
Fleet
Proportion of
FCEBs in Fleet
Proportion of FCEB
Achievable
Blocks*
2023 2 66 3% 100%
2025 3 66 5% 100%
2027 4 66 6% 100%
2029 8 66 9% 100%
2030 13 66 14% 100%
2033 5 66 8% 100%
2034 4 66 15% 100%
2035 8 66 12% 100%
2036 7 66 11% 100%
2037 5 66 8% 100%
2039 4 66 6% 100%
2040 3 66 5% 100%
TABLE 4: Estimated Costs of Future ZEB Purchases
40’ BEB 40’ FCEB
Average Bus Base Price from Washington State Contract $805,000 $1,087,000 Estimated Cost of Configurable Option $88,000 $88,000
Tax 10.25% 10.25%
Estimated Total Cost * $984,533 $1,295,438
*Steady state pricing is assumed for modeling purposes. The general expectation is that but FCEB prices will fall, although there is not enough information to make a confident projection in future pricing.
Is your transit agency considering converting some of the conventional buses in service to zero-emission buses (13 CCR § 2023.1(d) (1) (E))?
No
12 SECTION E: Facilities and Infrastructure Modifications Please complete Table 5 with names, locations, and main functions of transit agency divisions or facilities that would be involved in deploying and maintaining zero-emission buses.
Please limit the facilities to bus yards and facilities with maintenance, fueling, and charging functions, and exclude other operational functions like training centers, information and trip planning offices, and administrative buildings. Please identify which facility(ies) require construction, infrastructure modifications, or upgrades to support your transit agency's long-term transition to zero-emission technologies and the estimated timeline for such an upgrade. Please also specify the type(s) of infrastructure planned in each division or facility and provide their service capacities (e.g., en-route high-power charging system to deploy 20 BEB in 2025). (13 CCR § 2023.1(d) (1) (C)).
In the initial 2-5 years of the ZEB deployment, MBL intends to lease a mobile FCEB fueling station as a temporary short term solution. MBL considers the mobile fueling station to be a more efficient, cost-effective, and convenient option, while slowly transitioning to this innovative technology. During this period, MBL will conduct extensive research, infrastructure master planning, and design to accommodate a permanent fuel station as illustrated in Appendix A.
Hydrogen infrastructure costs include maintenance bay upgrades for H2 detection, ventilation systems, and the build-out of a hydrogen fueling station which includes design, construction, and equipment installation costs. Figure 3 identifies these costs and the related bus procurement costs associated with each project year.
Figure 3 illustrates the projected annual infrastructure cost from the commencement of the ZEB project through 2040. MBL estimates it will expend approximately $600,000 by the end of the initial 5-year period. This cost will include facility modifications, the mobile hydrogen fuel station, and training sessions for maintenance staff and first responders. The initial infrastructure builds also correspond to the annual bus procurement schedule in Figure 2.
13 FIGURE 3: Estimated Annual Infrastructure Costs
$2,890,876
$4,186,314
$5,181,752
$10,363,504
$16,840,694
$6,477,190
$5,181,752
$10,363,504
$9,068,066
$6,477,190
$5,181,752
$3,886,314
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
2023 2025 2027 2029 2030 2033 2034 2035 2036 2037 2039 2040
ESTIMATED INFRASTRUCTURE COST
YEAR
ESTIMATED ANNUAL INFRASTRUCTURE COSTS
14 TABLE 5: Facilities Information and Construction Timeline Division/
Facility Name Address Main Function(s) Type(s) of Infrastructure Service
Capacity
Needs
Upgrade?
MBL 400 S. Taylor Ave.
Montebello, CA 90640
CNG, Hybrid, Electric, and
FCEB Division
Hydrogen
Fueling Station 70 Buses Yes
Regarding the information provided in Table 5, please explain the types of necessary upgrades or infrastructure modifications each facility or division needs to support your transit agency’s long-term transition to ZEB. Please also provide the specification of each infrastructure in the related facility or division before and after the upgrades or modifications.
To facilitate the transition from conventional CNG transit buses to a ZEB fleet, MBL plans to conduct extensive research analysis to better understand the functionality of a hydrogen fuel station, safety and security measures, related grid and utility functions, storage, compression, and ongoing maintenance and support mechanisms. In addition, MBL will incorporate the ZEB rollout plan into the agency’s comprehensive operation analysis and short-range transit plan.
15 Do you expect to make any modifications to your bus parking arrangements? Explain the modifications and why they are needed.
An assessment of MBL’s parking layout determined slight modificationsto the parking lot design will be required. MBL will need to reconfigure the parking lot design to accommodate the hydrogen fueling station and provide designated parking areas for the FCEBs to refuel without disrupting the operation of the conventional bus fleet.
To optimize space, the parking area currently used to store the contingency fleet and surplus equipment will be converted to parking space for active buses. The intent of the parking lot redesign is to maintain an effective operationalsetup while transitioning into a ZEB fleet.
Do you expect to need additional parking spaces for completing the transition to zeroemission technologies? Explain why.
No. MBL has sufficient space to develop a hydrogen station infrastructure without encroaching on areas originally dedicated to bus parking.
In Table 6, please identify the propulsion system of all buses that will be dispatched from the facilities identified in Table 5.
TABLE 6: NOx-Exempt Area and Electric Utilities’ Territories Division/Facility
Name
Type(s) of Bus
Propulsion Systems
Located in NOxExempt Area?
Name(s) of Electric
Utility in Service
Area
MBL CNG, Hybrid,
Electric
No Southern California
Edison
Please identify the electric utilities in your transit agency’s service area. - Southern California Edison.
Note: The ICT regulation defines "NOx Exempt Areas" (13 CCR § 2023(b)(39)) as the following counties and air basins: Alpine, Amador, Butte, Calaveras, Colusa, Del Norte, Eastern Kern (the portion of Kern County within the Eastern Kern Air Pollution Control District), Glenn, Humboldt, Inyo, Lake, Lassen, Mariposa, Mendocino, Modoc, Mono, Monterey, Nevada, Northern Sonoma (as defined in title 17, California Code of Regulations, section 60100(e)), Plumas, San Benito, San Luis Obispo, Santa Barbara, Santa Cruz, Shasta, Sierra, Siskiyou, Northern Sutter (the portion of Sutter County that is north of the line that extends from the south east corner of Colusa County to the southwest corner of Yuba County), the portion of El Dorado County that is within the Lake Tahoe Air Basin (as defined in title 17, California Code of Regulations, section 60113), the portion of Placer County that is East of Highway 89 or within the Lake Tahoe Air Basin, Trinity, Tehama, Tuolumne, and Yub.
16 Section F: Providing Service in Disadvantaged Communities Does your transit agency serve one or more disadvantaged communities, as listed in the latest version of CalEnviroScreen?
Yes.
If yes, please describe how your transit agency is planning to deploy zero-emission buses in disadvantaged communities (13 CCR § 2023.1(d) (1) (F)).
MBL operates a network of 8 fixed routes and provides service to 117 disadvantaged communities (DAC). Currently, MBL operates three conventional buses converted to ZE with the purchase and deployment of two FCEBs tentatively scheduled for the first quarter of 2023. Additional FCEBs will be purchased every other year through 2040. To avoid service disruptions, the procurement planning process and progressive deployment of the new fleet will coincide with the replacement cycle of older conventional transit buses. MBL envisions a fully functional ZEB fleet to service all 117 DACs beginning 2040 (see Appendix B).
Please complete Table 7 with the estimated number of zero-emission buses your transit agency is planning to deploy in disadvantaged communities and the estimated timeline
17 TABLE 7: Service in Disadvantaged Communities
MBL Route
Expected
Year of First
ZEB
Deployment
Year of
Complete
Route
Electrification
Location of
Disadvantaged
Community
By Census Tract Number
10 2023 2037
06037482002
06037530400
06037482701
06037530301
06037531701
06037531702
06037532303
06037531800
06037531901
06037531902
06037530204
06037530102
06037530101
06037532001
06037532002
06037532101
06037500700
06037500600
06037500402
06037501001
06037501300
06037501002
06037501400
06037502100
06037504504
06037501804
06037501802
06037501900
06037501700
06037503301
20 2034 2037
06037481102
06037481202
06037481103
06037482301
06037482401
06037482402
06037530003
06037530005
06037530006
18 cont’d
06037500500
06037530102
06037530101
06037532101
06037532002
06037532200
30 2033 2033
06037481603
06037481604
06037530204
06037531902
06037531800
06037531902
06037532303
06037532304
06037533902
06037534001
06037534202
06037534203
06037534201
06037536102
40 2027 2030
06037209200
06037207301
06037207302
06037206031
06037203032
06037206050
06037204410
06037204420
06037204600
06037204700
06037204300
06037204120
06037203900
06037531101
06037531201
06037531102
06037531503
06037530500
06037531504
06037530400
06037531603
06037530301
06037530302
06037530204
06037530203
06037530102
19 cont’d
06037530006
06037530004
06037530101
06037500500
06037500600
06037500404
06037500402
06037500403
50 2025 2035
06037209200
06037207301
06037224010
06037224020
06037226001
06037203031
06037206050
06037205120
06037532400
06037532302
06037532303
06037532001
06037532200
06037500700
06037502500
06037502401
06037502301
06037502200
06037502302
06037502100
06037502700
06037502004
06037501803
06037501504
06037501400
06037501803
06037501804
06037502003
06037502902
06037503902
60 2036 2036
06037500404
06037500402
06037500403
06037500600
06037502401
06037502602
06037502601
20 70 2035 2035
06037530003
06037530005
06037530203
06037530204
06037530006
06037530102
03037531902
06037532001
06037532002
06037532101
06037532200
90 2036 2036
06037209200
06037207400
06037207301
06037207302
06037206031
06037206032
06037206050
06037204600
06037204700
06037204810
06037203900
06037531101
06037531201
06037531102
06037531503
06037531000
06037530500
06037530400
06037530301
06037530302
06037530204
06037530203
06037530102
06037530006
06037530005
06037530004
06037530003
21 SECTION G: Workforce Training
Please describe your transit agency’s plan and schedule for the training of bus operators and maintenance and repair staff on zero-emission bus technologies (13 CCR § 2023.1(d)(1)(G)). (Required)
The transition to an all-ZEB fleet will significantly
alter MBL’s service and operations due to different
maintenance needs, operational best practices, and the
change in technology. The conversion to ZE from the
existing traditional internal combustion engine is
logistically complicated and will impact the
operational organization. A comprehensive operational
analysis will be conducted to restructure the
appropriate prerequisite of critical knowledge, skills, abilities, and other characteristics (KSAOs) for
management and training to comply with ZEB
innovations.
The original equipment manufacturer (OEM) of ZEB
equipment (e.g., bus, charge management software,
battery charging equipment, etc.) will provide training, included as a deliverable on the procurement contract.
Internal training courses conducted on an annual, semiannual, tri-annual, and on an as needed basis includes:
Operator Refreshing, Bus Familiarization, New
Operator, and New Bus Training.
Bus Operator training incorporates pre-trip
inspections, door operators, emergency equipment
operator, steering, operational concerns, DMV pretrips, bus components and other related bus functions, and operations technology. Maintenance mechanic
training embodies imperative technical bumper to
bumper training focusing on preventive maintenance,
high voltage hazards, personal protective equipment
(PPE), component training, lock-out/tag-out
inspections, diagnostic/troubleshooting, and
charging/refueling source training. Proficiency in high voltage safety and proper use of PPE is required to
minimize the risk of electrical shocks and arc flashes.
In addition to OEM and internal training, maintenance
and operations personnel will be required to participate in the Southern California Regional Transit Training
Photo 1: Hydrogen Fuel Pump Station
Photo 2: Fuel Cell Energy Bus Refueling
22 Consortium (SCRTTC) and Arc Flash Electrical Safety National Fire Protection Association (NFPA) 70E courses.
Transit supervisors will work collaboratively with local first responders, such as the Fire and Police Department, to conduct training comprised of bus familiarization, energy storage systems, and emergency shutdown procedures.
Personnel and positions requiring retraining upon the adoption of the ZEB Rollout Plan include, but are not limited to, those listed in Table 8.
TABLE 8: Forecasted Personnel and Positions Training Requirements Position Required Training
Facilities Maintenance Staff Scheduled/unscheduled maintenance and repair of highvoltage systems of ZEBs equipment Mechanics Safety-related features and other components of ZEBs equipment
Service Workers Proper charging/refueling protocol and procedures of ZEBs equipment
Towing Service Providers Proper towing protocol and procedures for of ZEBs equipment
Transit Supervisors Operations and safety-related protocol and procedures of ZEBs equipment
Bus Operators
Safety-related & operational protocol and procedures of ZEBs equipment, Pre-Trip inspections, and pantograph
operations.
First Responders Proper safety protocol and procedures for ZEBs equipment in the event of an accident
23 SECTION H: Potential Funding Sources
Please identify all potential funding sources your transit agency expects to use to acquire zeroemission technologies (both vehicles and infrastructure) (13 CCR § 2023.1(d) (1) (H)).
MBL currently receives funding for the procurement and maintenance of its fleet from the following federal grant programs: the Federal Transit Administration’s (FTA) Urbanized Area Formula; discretionary grant programs such as the Bus and Bus Facilities (B&BF) program; and Low or No Emission Vehicle Deployment Program (LoNo).
To secure funds for future fleet procurement processes, MBL will seek additional funding from state resources through grant opportunities such as Senate Bill 1 – State of Good Repair (SGR) and the Low Carbon Transit Operations Program (LCTOP).
24 SECTION I: Start-up and Scale-up Challenges
Please describe any major challenges your transit agency is currently facing in small scale zero-emission bus deployment. (Optional). How might CARB assist you to overcome these challenges? Please share your recommendations. (Optional) Please describe any challenges your transit agency may face in scaling up zero-emission bus deployment. (Optional) How might CARB assist you to overcome these challenges? Please share your recommendations. (Optional)
ZE technology is an innovative and progressive industry with significant unpredictable advancement challenges due to the developing nature of the unprecedented technology. These challenges pose a risk to transit performance, service reliability, capital, and operational and maintenance (O&M) costs.
MBL has encountered multiple challenges since implementing the BEB Deployment Pilot Program in 2019. Major ongoing challenges with the deployment of ZEBs include OEM technical support and training, poor performance and range, high capital and O&M costs, funding, and facility infrastructure. The OEM technical support and training provided is insufficient to maintain and repair the BEBs. For each week of use, BEBs require a lead time of approximately three weeks for repairs due to the complexity of the electrical component. MBL’s BEB fleet requires several hours to fully charge and suffers from underperforming batteries that are unable to attain the advertised range miles (265 miles per full charge) and lifespan. These BEBs attain 180 miles per full charge and the batteries self-discharge degraded more rapidly than the guaranteed expected shelf life. Consequently, battery replacements were accelerated at a high cost for replacement batteries and disposal fees. The high capital and O&M costs include, but are not limited to, electricity, towing services, proprietary products, software, and services associated with frequent equipment breakdowns. Deploying BEBs is not economically and operationally feasible for MBL’s business operations. Correspondingly, MBL’s historical records and experiences associated with ZEBs and ZE technology cast a long shadow of apprehension on the ZE industry.
The ZEB market value is notably greater than its alternative fuel counterparts, with an upward value of approximately $250,000. Additional upfront costs include a facility fuel infrastructure upgrade. CARB’s influence in tax exemption, policy and law administration, and grant funding will help transit agencies adopt a ZE fleet with minimal setbacks.
Overall, MBL’s current facility and infrastructure are not economically and operationally structured to support and sustain any ZEB deployment. MBL’s present geographic footprint cannot accommodate expanding growth and requires innovative upgrades to the existing infrastructure.
Therefore, any construction work will require a concurrent strategic plan that will not hinder daily operational activities. Funding sources are the most crucial component in executing any proposed project to support capital expenditures that account for the cost of assets, facility and infrastructure upgrades, O&M, workforce, and workforce training. CARB’s presence as a central information system that provides and supports the latest research and development of ZEBs and ZE technology (e.g., ZEBs performances, O&M costs & labor hours, workforce training, OEM reports, etc.) can
25 ensure transit agencies are retrieving the most current data and grant applications. The ZE industry is highly volatile, considering the fact that ZEB and ZE technology is progressively collecting new data and evolving from obsolete prototypes. Correspondingly, federal and state grant funding administers relief and mitigates the turmoil involved in the conversion to ZEBs and ZE technology.
26 APPENDIX A: MBL Site Renderings
***Proposed Mobile
Hydrogen Fueling
Station
27
28 APPENDIX B: DAC and Low-Income Service Map
ATTACHMENT C
RESOLUTION NO. 25-40
RESOLUTION OF THE CITY OF MONTEBELLO, CALIFORNIA, AUTHORIZING THE
SUBMISSION OF APPLICATIONS TO THE FEDERAL TRANSIT ADMINISTRATION (FTA) LOW OR NO EMISSION GRANT PROGRAM AND THE BUSES AND BUS
FACILITIES GRANT PROGRAM
RECITALS
WHEREAS, the Federal Transit Administrator (FTA) has the authority to award federal financial assistance for a transportation project; and WHEREAS, the grant or cooperative agreement for federal financial assistance will impose certain obligations upon the applicant and may require the applicant to provide the local share of the project cost; and
WHEREAS, the applicant has or will provide all annual certifications and assurances to the FTA required for the project.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF MONTEBELLO, CALIFORNIA HEREBY RESOLVES, FINDS, AND DECLARES AS FOLLOWS:
APPROVES THE FILING OF AN APPLICATION FOR THE FTA LOW OR NO EMISSION GRANT PROGRAM AND THE BUSES AND BUS FACILITIES GRANT PROGRAM; AND SECTION 1: Approvals and Certifications.
1. Certifies that said Applicant has or will have available, prior to commencement of any work on the projects included in this application, the sufficient funds to complete the projects; and
2. Certifies that if funding is awarded, the Applicant has or will have sufficient funds to operate and maintain the projects; and
3. Delegates the authority to the Director of Transportation or her designees to execute and file with its application the annual certifications and assurances and other documents the Federal Transportation Administration requires before awarding a federal assistance grant or cooperative agreement; and
4. Agrees to comply with all applicable federal, state, and local laws, ordinances, rules, regulations, and guidelines; and
SECTION 2: That the City Clerk shall certify to the passage and adoption of this Resolution and that the same shall be in full force and effect.
RESOLUTION NO. 25-40
APPROVED AND ADOPTED THIS 25TH DAY OF JUNE 2025.
_______________________________
Salvador Melendez, Mayor
ATTEST: APPROVED AS TO FORM:
________________________________ ________________________________ Christopher Jimenez, City Clerk Arnold M. Alvarez-Glasman, City Attorney
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS:
CITY OF MONTEBELLO )
I, Christopher Jimenez, City Clerk of the City of Montebello, County of Los Angeles, State of California, hereby certify that the foregoing Resolution No. 25-40 was passed and adopted by the City Council of the City of Montebello, signed by the Mayor and attested by the City Clerk at a regular meeting of said Council held on the 25th day of June 2025 and that said Resolution was adopted by the following vote, to-wit:
AYES:
NOES:
ABSTAIN:
ABSENT:
The undersigned, City Clerk of the City of Montebello, does hereby attest and certify that the foregoing Resolution is a true, full and correct copy of a resolution duly adopted at a meeting of said City which was duly convened and held on the date stated thereon, and that said document has not been amended, modified, repealed or rescinded since its date of adoption and is in full force and effect as of the date hereof.
DATE:
Christopher Jimenez, City Clerk
ITEM # 20
CITY OF MONTEBELLO
CITY COUNCIL AGENDA STAFF REPORT
TO: Honorable Mayor and City Council Members
FROM: Raul Alvarez, City Manager
BY: John Soria, Director
SUBJECT: APPROVE BLANKET PURCHASE ORDER WITH AFTERMARKET
PARTS COMPANY LLC, AMERICAN MOVING PARTS LLC, CUMMINS
CAL PACIFIC LLC, INLAND KENWORTH, INC., AND WAYNE
HARMEIER, INC., FOR MAINTENANCE-RELATED BUS, FIRE
APARATUS, AND VEHICLE FLEET PARTS
DATE: June 25, 2025
RECOMMENDATIONS:
It is recommended that the City Council:
1. Approve establishing a blanket purchase order (PO) with Aftermarket Parts Company LLC (Aftermarket Parts), for a total not-to-exceed amount of Two Hundred Thousand Dollars ($250,000), to purchase maintenance-related bus parts for Fiscal Year 2025-26; and
2. Approve establishing a blanket PO with American Moving Parts LLC (American Moving Parts), for a total not-to-exceed amount of One Hundred and Forty Thousand Dollars ($140,000), to purchase maintenance-related bus and fire apparatus parts for both Montebello Bus Lines (MBL) and the Montebello Fire Department (MFD) for FY 2025-26; and
3. Approve establishing a blanket PO with Cummins Cal Pacific LLC (Cummins Pacific), for a total not-to-exceed amount of One Hundred and Twenty Thousand Dollars ($120,000), to purchase maintenance-related bus and fleet parts for both MBL and the MFD for FY 2025-26; and
4. Approve establishing a blanket PO with Inland Kenworth, Inc. (Inland Kenworth), for a total not-to-exceed amount of One Hundred Thousand Dollars ($100,000), to purchase maintenance-related bus parts for FY 2025-26; and
5. Approve establishing a blanket PO with Wayne Harmeier, Inc. (dba Wayne Electric Company), for a total not-to-exceed amount of Eighty Thousand Dollars ($80,000), to purchase maintenance-related bus parts for FY 2025-26; and
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
6. Take such additional, related, action that may be desirable.
FISCAL IMPACT:
Sufficient funds have been appropriated in the FY 2025-26 proposed operating budget in the Transit Fund and General Fund (Fire Department) for the various purchases under these blanket purchase orders. Therefore, a budget amendment is not needed. Tables 1-5 detail the allocated amounts and corresponding account numbers as follows:
BACKGROUND/DISCUSSION:
The City of Montebello operates Montebello Bus Lines (MBL), which includes a fleet of sixty-six (66) buses, nine (9) relief vehicles, and four (4) supervisor vehicles, all of which require ongoing maintenance. In addition, the City has its own Fire Department which utilizes a wide range of fire apparatus that require ongoing maintenance. The most efficient and cost-effective way to purchase replacement bus, fire apparatus, and vehicle fleet parts is to establish blanket POs with the primary companies that supply these maintenance-related parts.
Staff will utilize the City’s sole-source procurement process in accordance with the Montebello Municipal Code (MMC) Section 3.20.050 – Conformance with bidding procedures. This will strengthen the City’s financial processes and ensure compliance with applicable competitive and non-competitive contracting requirements. The solesource procurement method will be used to make purchases including, but not limited to:
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
• Aftermarket Parts: headlights, fan control modules, clamps, windshield wipers, coolants, airbags, clutches, stabilizers, and thrust washers. • American Moving Parts: engines, brake kits, air dryer cartridge kits, cables, filters, transmission drums, wheel linings, and sensor replacement. • Cumins Pacific: spark plug kits, fan supports, ignition coils, engine rods, electronic control modules, engine wiring harness, and water pumps. • Inland Kenworth: valves, relays, hoses, seals, cylinder heads, tubes, engine control modules, engine in-frame kits, coil extensions, and sensors. • Wayne Electric Company: EMP alternators, air conditioning compressors, toggle switches, fan drivers, farebox motors, pumps, and filters.
MMC Section 3.20.050 – Conformance with bidding procedure, outlines exceptions to the formal and open market bidding and procurement procedures detailed in the MMC.
The vendors listed have been identified as direct or sub-contracted suppliers of specific maintenance-related, original equipment manufacturer (OEM) parts, compatible with both MBL and the MFD fleets. The buses, vehicles and fire apparatus in use require specific parts in order to function most efficiently. Purchasing these parts (see list above) from the listed vendors ensures the City's buses and Fire apparatus operate safely and when needed -- ensuring public safety.
Staff recommend that the City Council approve establishing a blanket PO specific to the vendors listed in accordance with MMC Section 3.20.050(B) which allows the procurement of parts and equipment from identified sole-source and/or single source vendors to ensure the continued operation of MBL and the MFD. Once approved, staff will complete a Sole Source Declaration form (Attachment A) as a written record for each vendor.
ENVIRONMENTAL:
N/A
ANALYSIS:
N/A
SUMMARY:
For FY 2025-26, staff recommend that the City Council approve establishing a blanket PO with Aftermarket Parts for a total not-to-exceed amount of $250,000, to purchase maintenance-related bus parts; approve establishing a blanket PO with American Moving Parts for a total not-to-exceed amount of $140,000, to purchase maintenancerelated bus and fire apparatus parts for both MBL and the MFD; approve establishing a blanket PO with Cummins Pacific for a total not-to-exceed amount of $120,000, to purchase maintenance-related bus and fleet parts for MBL and MFD; approve establishing a blanket PO with Inland Kenworth for a total not-to-exceed amount of $100,000, to purchase maintenance-related bus parts; approve establishing a blanket
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
PO with Wayne Electric Company for a total not-to-exceed amount of $80,000, to purchase maintenance-related bus parts; and take such additional, related, action that may be desirable. Sufficient funding has been included in the MBL and MFD FY 2025-26 proposed operating budgets for these expenses. Therefore, a budget amendment is not needed as part of the recommended actions.
ATTACHMENT(S)
1. Attachment A – Sole Source Declaration Form
ATTACHMENT A
Sole Source Declaration Form
Updated 03/2023
SOLE SOURCE DECLARATION
I, THE UNDERSIGNED, DO HEREBY CERTIFY to the best of my knowledge, after analyzing pertinent information available to us at this time, the item(s)/service(s) listed below can only be furnished by the following vendor due to the following justification(s):
Item/Service
Vendor
Address
City, State
Justification: Refer to Back Page of this Form for Accepted Justification and Indicate the Exception Claimed Below, Provide Additional Information as Needed I declare under penalty of perjury that the foregoing is true and correct. _________________________________ ________________
(Insert Department Director Name) Date
Signature
Under “Justification” on Page 1 of this form, indicate which exception to the Purchasing Municipal Code (Chapter 3.20 et al) is being claimed to deem this purchase a “sole source purchase:”
Acceptable and Allowed Exceptions:
1. Only one manufacturer makes the item(s) meeting required specifications, AND that manufacturer only sells direct/exclusively through one regional/national vendor/representative.
2. The original manufacturer can only perform maintenance or repair services, AND the manufacturer does not have multiple agents to perform the required services.
3. Replacement and/or spare parts are exclusively available from the original manufacturer, AND the original manufacturer does not have distributors for those parts.
4. Patented items or copyrighted materials that are only available from the patent or copyright holder.
5. A formal/informal survey has been conducted by the requesting Department and/or Finance Department to determine whether other vendors/consultants can satisfy the requirements of the item or service. The survey provides vendors/consultants with a list of detailed requirements, and they provide a written response regarding their capability to supply the item or service. If only one (1) vendor can meet all of the listed requirements, this survey may be used to support the sole source claim.
6. A collaborative project where a specific vendor/contractor/consultant is named by the funding agency and/or inter-agency agreement as the source of an item or service, and the use of the vendor/consultant is required for compatibility.
ITEM # 21
CITY OF MONTEBELLO
CITY COUNCIL AGENDA STAFF REPORT
TO: Honorable Mayor and City Council Members
FROM: Raul Alvarez, City Manager
BY: John Soria, Director
SUBJECT: APPROVE BLANKET PURCHASE ORDER WITH RUSH TRUCK CENTERS OF CALIFORNIA, INC. FOR MAINTENANCE-RELATED BUS
AND VEHICLE FLEET PARTS
DATE: June 25, 2025
RECOMMENDATIONS:
It is recommended that the City Council:
1. Approve establishing a blanket purchase order (PO) with Rush Truck Centers of California, Inc. (Rush Trucks), for a total not-to-exceed amount of Eighty Thousand Dollars ($80,000) to purchase maintenance-related bus and vehicle fleet parts for Fiscal Year 2025-26; and
2. Take such additional, related, action that may be desirable.
FISCAL IMPACT:
Sufficient funds have been included in the Transportation Department’s Fiscal Year 2025- 26 proposed operating budget for the prodcts to be purchased from Rush Trucks. Table 1 details the allocated amounts and corresponding account numbers in the Transit Fund (Fund 600):
BACKGROUND/DISCUSSION:
The City of Montebello operates Montebello Bus Lines (MBL), which includes a fleet of
CITY COUNCIL AGENDA REPORT - MEETING OF JUNE 25, 2025
sixty-six (66) buses, nine (9) relief vehicles, and four (4) supervisor vehicles, all of which require ongoing maintenance. The most efficient and cost-effective way to purchase replacement bus and vehicle fleet parts is to establish blanket purchase orders with the primary companies that supply these maintenance-related parts.
Staff will utilize the City’s piggyback procurement process in accordance with the Montebello Municipal Code (MMC) Section 3.20.125 – Piggybacking purchasing agreements. The piggyback procurement method will be used for the procurement of various maintenance parts including, but not limited to:
• Rush Truck: engine and emission parts, engine cooling components, and transmissions
Municipal Code Section 3.20.125 - Piggybacking purchasing agreements, allows the purchasing officer to enter into purchasing agreements with vendors for supplies, equipment, services, and more, based on pricing and terms established by other public entities. OMNIA Partners is a cooperative purchasing organization to which the City belongs that leverages the collective buying power of public agencies to secure competitively solicited and publicly awarded contracts, resulting in cost savings and procurement efficiency.
Staff recommend that the City Council approve establishing a blanket purchase order for FY 2025-26 with Rush Truck using pricing negotiated through OMNIA Partners (Attachment A). Once approved, staff will receive vendor-specific codes that will allow MBL to begin purchasing parts through this cooperative purchasing program.
ENVIRONMENTAL:
N/A
ANALYSIS:
N/A
SUMMARY:
Staff recommend that the City Council approve establishing a blanket PO with Rush Truck, for a total not-to-exceed amount of $80,000, to purchase maintenance-related bus and vehicle fleet parts for FY 2025-26; and take such additional, related, action that may be desirable. Sufficient funding has been included in the FY 2025-26 proposed operating budget; therefore, no budget amendment is needed as part of the recommended action.
ATTACHMENT(S)
1. Attachment A – Omni Partners Contract No. 05-47 – Rush Truck Enterprises
Tab 1 – Master Agreement
General Terms and Conditions
¨ Customer Support
Ø The vendor shall provide timely and accurate technical advice and sales support. The vendor shall respond to such requests within one (1) working day after receipt of the request.
¨ Disclosures
Ø Respondent affirms that he/she has not given, offered to give, nor intends to give at any time hereafter any economic opportunity, future employment, gift, loan, gratuity, special discount, trip, favor or service to a public servant in connection with this contract.
Ø The respondent affirms that, to the best of his/her knowledge, the offer has been arrived at independently, and is submitted without collusion with anyone to obtain information or gain any favoritism that would in any way limit competition or give an unfair advantage over other vendors in the award of this contract.
¨ Renewal of Contract
Ø Unless otherwise stated, all contracts are for a period of three (3) years with an option to renew for up to two (2) additional one-year terms or any combination of time equally not more than 2 years if agreed to by Region 14 ESC and the vendor. ¨ Funding Out Clause
Ø Any/all contracts exceeding one (1) year shall include a standard “funding out” clause. A contract for the acquisition, including lease, of real or personal property is a commitment of the entity’s current revenue only, provided the contract contains either or both of the following provisions:
Ø Retains to the entity the continuing right to terminate the contract at the expiration of each budget period during the term of the contract and is conditioned on a best efforts attempt by the entity to obtain appropriate funds for payment of the contract. ¨ Shipments (if applicable)
Ø The awarded vendor shall ship ordered products within seven (7) working days for goods available and within four (4) to six (6) weeks for specialty items after the receipt of the order unless modified. If a product cannot be shipped within that time, the awarded vendor shall notify the entity placing the order as to why the product has not shipped and shall provide an estimated shipping date. At this point the participating entity may cancel the order if estimated shipping time is not acceptable. ¨ Tax Exempt Status
Ø Since this is a national contract, knowing the tax laws in each state is the sole responsibility of the vendor.
ATTACHMENT A
¨ Payments
Ø The entity using the contract will make payments directly to the awarded vendor or their affiliates (distributors/business partners/resellers) as long as written request and approval by NCPA is provided to the awarded vendor.
¨ Adding authorized distributors/dealers
Ø Awarded vendors may submit a list of distributors/partners/resellers to sell under their contract throughout the life of the contract. Vendor must receive written approval from NCPA before such distributors/partners/resellers considered authorized.
Ø Purchase orders and payment can only be made to awarded vendor or distributors/business partners/resellers previously approved by NCPA.
Ø Pricing provided to members by added distributors or dealers must also be less than or equal to the pricing offered by the awarded contract holder.
Ø All distributors/partners/resellers are required to abide by the Terms and Conditions of the vendor's agreement with NCPA.
¨ Pricing
Ø All pricing submitted shall include the administrative fee to be remitted to NCPA by the awarded vendor. It is the awarded vendor’s responsibility to keep all pricing up to date and on file with NCPA.
Ø All deliveries shall be freight prepaid, F.O.B. destination and shall be included in all pricing offered unless otherwise clearly stated in writing
¨ Warranty
Ø Proposals should address each of the following:
§ Applicable warranty and/or guarantees of equipment and installations including any conditions and response time for repair and/or replacement of any components during the warranty period.
§ Availability of replacement parts
§ Life expectancy of equipment under normal use
§ Detailed information as to proposed return policy on all equipment ¨ Indemnity
Ø The awarded vendor shall protect, indemnify, and hold harmless Region 14 ESC and its participants, administrators, employees and agents against all claims, damages, losses and expenses arising out of or resulting from the actions of the vendor, vendor employees or vendor subcontractors in the preparation of the solicitation and the later execution of the contract.
¨ Franchise Tax
Ø The respondent hereby certifies that he/she is not currently delinquent in the payment of any franchise taxes.
¨ Supplemental Agreements
Ø The entity participating in this contract and awarded vendor may enter into a separate supplemental agreement to further define the level of service requirements over and above the minimum defined in this contract i.e. invoice requirements, ordering requirements, specialized delivery, etc. Any supplemental agreement developed as a result of this contract is exclusively between the participating entity and awarded vendor. ¨ Certificates of Insurance
Ø Certificates of insurance shall be delivered to the Public Agency prior to commencement of work. The insurance company shall be licensed in the applicable state in which work is being conducted. The awarded vendor shall give the participating entity a minimum of ten (10) days’ notice prior to any modifications or cancellation of policies. The awarded vendor shall require all subcontractors performing any work to maintain coverage as specified. ¨ Legal Obligations
Ø It is the Respondent’s responsibility to be aware of and comply with all local, state, and federal laws governing the sale of products/services identified in this RFP and any awarded contract and shall comply with all while fulfilling the RFP. Applicable laws and regulation must be followed even if not specifically identified herein. ¨ Protest
Ø A protest of an award or proposed award must be filed in writing within ten (10) days from the date of the official award notification and must be received by 5:00 pm CST. Protests shall be filed with Region 14 ESC and shall include the following:
§ Name, address and telephone number of protester
§ Original signature of protester or its representative § Identification of the solicitation by RFP number
§ Detailed statement of legal and factual grounds including copies of relevant documents and the form of relief requested
Ø Any protest review and action shall be considered final with no further formalities being considered.
¨ Force Majeure
Ø If by reason of Force Majeure, either party hereto shall be rendered unable wholly or in part to carry out its obligations under this Agreement then such party shall give notice and full particulars of Force Majeure in writing to the other party within a reasonable time after occurrence of the event or cause relied upon, and the obligation of the party giving such notice, so far as it is affected by such Force Majeure, shall be suspended during the continuance of the inability then claimed, except as hereinafter provided, but for no longer period, and such party shall endeavor to remove or overcome such inability with all reasonable dispatch.
Ø The term Force Majeure as employed herein, shall mean acts of God, strikes, lockouts, or other industrial disturbances, act of public enemy, orders of any kind of government of the
United States or any civil or military authority; insurrections; riots; epidemics; landslides; lighting; earthquake; fires; hurricanes; storms; floods; washouts; droughts; arrests; restraint of government and people; civil disturbances; explosions, breakage or accidents to machinery, pipelines or canals, or other causes not reasonably within the control of the party claiming such inability. It is understood and agreed that the settlement of strikes and lockouts shall be entirely within the discretion of the party having the difficulty, and that the above requirement that any Force Majeure shall be remedied with all reasonable dispatch shall not require the settlement of strikes and lockouts by acceding to the demands of the opposing party or parties when such settlement is unfavorable in the judgment of the party having the difficulty.
¨ Prevailing Wage
Ø It shall be the responsibility of the Vendor to comply, when applicable, with the prevailing wage legislation in effect in the jurisdiction of the purchaser. It shall further be the responsibility of the Vendor to monitor the prevailing wage rates as established by the appropriate department of labor for any increase in rates during the term of this contract and adjust wage rates accordingly.
¨ Miscellaneous
Ø Either party may cancel this contract in whole or in part by providing written notice. The cancellation will take effect 30 business days after the other party receives the notice of cancellation. After the 30th business day all work will cease following completion of final purchase order.
¨ Open Records Policy
Ø Because Region 14 ESC is a governmental entity responses submitted are subject to release as public information after contracts are executed. If a vendor believes that its response, or parts of its response, may be exempted from disclosure, the vendor must specify page-bypage and line-by-line the parts of the response, which it believes, are exempt. In addition, the respondent must specify which exception(s) are applicable and provide detailed reasons to substantiate the exception(s).
Ø The determination of whether information is confidential and not subject to disclosure is the duty of the Office of Attorney General (OAG). Region 14 ESC must provide the OAG sufficient information to render an opinion and therefore, vague and general claims to confidentiality by the respondent are not acceptable. Region 14 ESC must comply with the opinions of the OAG. Region14 ESC assumes no responsibility for asserting legal arguments on behalf of any vendor. Respondent are advised to consult with their legal counsel concerning disclosure issues resulting from this procurement process and to take precautions to safeguard trade secrets and other proprietary information.
Process
Region 14 ESC will evaluate proposals in accordance with, and subject to, the relevant statutes, ordinances, rules, and regulations that govern its procurement practices. NCPA will assist Region 14 ESC in evaluating proposals. Award(s) will be made to the prospective vendor whose response is determined to be the most advantageous to Region 14 ESC, NCPA, and its participating agencies. To qualify for evaluation, response must have been submitted on time, and satisfy all mandatory requirements identified in this document.
¨ Contract Administration
Ø The contract will be administered by Region 14 ESC. The National Program will be administered by NCPA on behalf of Region 14 ESC.
¨ Contract Term
Ø The contract term will be for three (3) year starting from the date of the award. The contract may be renewed for up to two (2) additional one-year terms or any combination of time equally not more than 2 years.
Ø It should be noted that maintenance/service agreements may be issued for up to (5) years under this contract even if the contract only lasts for the initial term of the contract. NCPA will monitor any maintenance agreements for the term of the agreement provided they are signed prior to the termination or expiration of this contract. ¨ Contract Waiver
Ø Any waiver of any provision of this contract shall be in writing and shall be signed by the duly authorized agent of Region 14 ESC. The waiver by either party of any term or condition of this contract shall not be deemed to constitute waiver thereof nor a waiver of any further or additional right that such party may hold under this contract. ¨ Products and Services additions
Ø Products and Services may be added to the resulting contract during the term of the contract by written amendment, to the extent that those products and services are within the scope of this RFP.
¨ Competitive Range
Ø It may be necessary for Region 14 ESC to establish a competitive range. Responses not in the competitive range are unacceptable and do not receive further award consideration. ¨ Deviations and Exceptions
Ø Deviations or exceptions stipulated in response may result in disqualification. It is the intent of Region 14 ESC to award a vendor’s complete line of products and/or services, when possible.
¨ Estimated Quantities
Ø The estimated dollar volume of Products and Services purchased under the proposed Master Agreement is $30 million dollars annually. This estimate is based on the anticipated volume of Region 14 ESC and current sales within the NCPA program. There is no guarantee or commitment of any kind regarding usage of any contracts resulting from this solicitation
¨ Evaluation
Ø Region 14 ESC will review and evaluate all responses in accordance with, and subject to, the relevant statutes, ordinances, rules and regulations that govern its procurement practices. NCPA will assist the lead agency in evaluating proposals. Recommendations for contract awards will be based on multiple factors, each factor being assigned a point value based on its importance.
¨ Formation of Contract
Ø A response to this solicitation is an offer to contract with Region 14 ESC based upon the terms, conditions, scope of work, and specifications contained in this request. A solicitation does not become a contract until it is accepted by Region 14 ESC. The prospective vendor must submit a signed Signature Form with the response thus, eliminating the need for a formal signing process.
¨ NCPA Administrative Agreement
Ø The vendor will be required to enter and execute the National Cooperative Purchasing Alliance Administration Agreement with NCPA upon award with Region 14 ESC. The agreement establishes the requirements of the vendor with respect to a nationwide contract effort.
¨ Clarifications / Discussions
Ø Region 14 ESC may request additional information or clarification from any of the respondents after review of the proposals received for the sole purpose of elimination minor irregularities, informalities, or apparent clerical mistakes in the proposal.
Clarification does not give respondent an opportunity to revise or modify its proposal, except to the extent that correction of apparent clerical mistakes results in a revision. After the initial receipt of proposals, Region 14 ESC reserves the right to conduct discussions with those respondent’s whose proposals are determined to be reasonably susceptible of being selected for award. Discussions occur when oral or written communications between Region 14 ESC and respondent’s are conducted for the purpose clarifications involving information essential for determining the acceptability of a proposal or that provides respondent an opportunity to revise or modify its proposal. Region 14 ESC will not assist respondent bring its proposal up to the level of other proposals through discussions. Region 14 ESC will not indicate to respondent a cost or price that it must meet to neither obtain further consideration nor will it provide any information about other respondents’ proposals or prices.
¨ Multiple Awards
Ø Multiple Contracts may be awarded as a result of the solicitation. Multiple Awards will ensure that any ensuing contracts fulfill current and future requirements of the diverse and large number of participating public agencies.
¨ Past Performance
Ø Past performance is relevant information regarding a vendor’s actions under previously awarded contracts; including the administrative aspects of performance; the vendor’s history of reasonable and cooperative behavior and commitment to customer satisfaction; and generally, the vendor’s businesslike concern for the interests of the customer.
Evaluation Criteria
¨ Pricing (40 points)
Ø Electronic Price Lists
§ Products, Services, Warranties, etc. price list
§ Prices listed will be used to establish both the extent of a vendor’s product lines, services, warranties, etc. available from a particular bidder and the pricing per item. ¨ Ability to Provide and Perform the Required Services for the Contract (25 points) Ø Product Delivery within participating entities specified parameters Ø Number of line items delivered complete within the normal delivery time as a percentage of line items ordered.
Ø Vendor’s ability to perform towards above requirements and desired specifications.
Ø Past Cooperative Program Performance
Ø Quantity of line items available that are commonly purchased by the entity.
Ø Quality of line items available compared to normal participating entity standards. ¨ References (15 points)
Ø A minimum of ten (10) customer references for product and/or services of similar scope dating within past 3 years
¨ Technology for Supporting the Program (10 points)
Ø Electronic on-line catalog, order entry use by and suitability for the entity’s needs Ø Quality of vendor’s on-line resources for NCPA members.
Ø Specifications and features offered by respondent’s products and/or services ¨ Value Added Services Description, Products and/or Services (10 points) Ø Marketing and Training
Ø Minority and Women Business Enterprise (MWBE) and (HUB) Participation Ø Customer Service
Tab 2 – NCPA Administration Agreement
This Administration Agreement is made as of , by and between National Cooperative Purchasing Alliance (“NCPA”) and (“Vendor”).
Recitals
WHEREAS, Region 14 ESC has entered into a certain Master Agreement dated , referenced as Contract Number , by and between Region 14 ESC and Vendor, as may be amended from time to time in accordance with the terms thereof (the “Master Agreement”), for the purchase of Heavy Equipment, Diesel Truck, Bus Parts and Related Goods and Services; WHEREAS, said Master Agreement provides that any state, city, special district, local government, school district, private K-12 school, technical or vocational school, higher education institution, other government agency or nonprofit organization (hereinafter referred to as “public agency” or collectively, “public agencies”) may purchase products and services at the prices indicated in the Master Agreement; WHEREAS, NCPA has the administrative and legal capacity to administer purchases under the Master Agreement to public agencies;
WHEREAS, NCPA serves as the administrative agent for Region 14 ESC in connection with other master agreements offered by NCPA
WHEREAS, Region 14 ESC desires NCPA to proceed with administration of the Master Agreement; WHEREAS, NCPA and Vendor desire to enter into this Agreement to make available the Master Agreement to public agencies on a national basis;
NOW, THEREFORE, in consideration of the payments to be made hereunder and the mutual covenants contained in this Agreement, NCPA and Vendor hereby agree as follows:
¨ General Terms and Conditions
Ø The Master Agreement, attached hereto as Tab 1 and incorporated herein by reference as though fully set forth herein, and the terms and conditions contained therein shall apply to this Agreement except as expressly changed or modified by this Agreement.
Ø NCPA shall be afforded all of the rights, privileges and indemnifications afforded to Region 14 ESC under the Master Agreement, and such rights, privileges and indemnifications shall accrue and apply with equal effect to NCPA under this Agreement including, but not limited to, the Vendor’s obligation to provide appropriate insurance and certain indemnifications to Region 14 ESC.
Ø Vendor shall perform all duties, responsibilities and obligations required under the Master Agreement in the time and manner specified by the Master Agreement.
Ø NCPA shall perform all of its duties, responsibilities, and obligations as administrator of purchases under the Master Agreement as set forth herein, and Vendor acknowledges that NCPA shall act in the capacity of administrator of purchases under the Master Agreement.
Ø With respect to any purchases made by Region 14 ESC or any Public Agency pursuant to the Master Agreement, NCPA (a) shall not be construed as a dealer, re-marketer, representative, partner, or agent of any type of Vendor, Region 14 ESC, or such Public Agency, (b) shall not be obligated, liable or responsible (i) for any orders made by Region Rush Truck Centers of Texas, LP
December 8, 2020
December 8, 2020
05-47
14 ESC, any Public Agency or any employee of Region 14 ESC or Public Agency under the Master Agreement, or (ii) for any payments required to be made with respect to such order, and (c) shall not be obligated, liable or responsible for any failure by the Public Agency to (i) comply with procedures or requirements of applicable law, or (ii) obtain the due authorization and approval necessary to purchase under the Master Agreement. NCPA makes no representations or guaranties with respect to any minimum purchases required to be made by Region 14 ESC, any Public Agency, or any employee of Region 14 ESC or Public Agency under this Agreement or the Master Agreement.
Ø The Public Agency participating in the NCPA contract and Vendor may enter into a separate supplemental agreement to further define the level of service requirements over and above the minimum defined in this contract i.e. invoice requirements, ordering requirements, specialized delivery, etc. Any supplemental agreement developed as a result of this contract is exclusively between the Public Agency and Vendor. NCPA, its agents, members and employees shall not be made party to any claim for breach of such agreement. ¨ Term of Agreement
Ø This Agreement shall be in effect so long as the Master Agreement remains in effect, provided, however, that the obligation to pay all amounts owed by Vendor to NCPA through the termination of this Agreement and all indemnifications afforded by Vendor to NCPA shall survive the term of this Agreement.
¨ Fees and Reporting
Ø The awarded vendor shall electronically provide NCPA with a detailed quarterly report showing the dollar volume of all sales under the contract for the previous quarter. Reports are due on the fifteenth (15th) day after the close of the previous quarter. It is the responsibility of the awarded vendor to collect and compile all sales under the contract from participating members and submit one (1) report. The report shall include at least the following information as listed in the example below:
Entity Name Zip Code State PO or Job # Sale Amount
Total
Ø Each quarter NCPA will invoice the vendor based on the total of sale amount(s) reported.
From the invoice the vendor shall pay to NCPA an administrative fee based upon the tiered fee schedule below. Vendor’s annual sales shall be measured on a calendar year basis.
Deadline for term of payment will be included in the invoice NCPA provides.
Annual Sales Through Contract Administrative Fee
0 - $30,000,000 2%
$30,000,001 - $50,000,000 1.5%
$50,000,001+ 1%
Ø Supplier shall maintain an accounting of all purchases made by Public Agencies under the Master Agreement. NCPA and Region 14 ESC reserve the right to audit the accounting for a
Tab 3 – Vendor Questionnaire
Please provide responses to the following questions that address your company’s operations, organization, structure, and processes for providing products and services. ¨ States Covered
Ø Bidder must indicate any and all states where products and services can be offered.
Ø Please indicate the price co-efficient for each state if it varies. 50 States & District of Columbia (Selecting this box is equal to checking all boxes below) Alabama Maryland South Carolina
Alaska Massachusetts South Dakota
Arizona Michigan Tennessee
Arkansas Minnesota Texas
California Mississippi Utah
Colorado Missouri Vermont
Connecticut Montana Virginia
Delaware
District of Columbia
Nebraska
Nevada
Washington
West Virginia
Florida New Hampshire Wisconsin
Georgia New Jersey Wyoming
Hawaii New Mexico
Idaho New York
Illinois North Carolina
Indiana North Dakota
Iowa Ohio
Kansas Oklahoma
Kentucky Oregon
Louisiana Pennsylvania
Maine Rhode Island
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
All US Territories and Outlying Areas (Selecting this box is equal to checking all boxes below) ¨ Minority and Women
Business Enterprise (MWBE) and (HUB) Participation
Ø It is the policy of some entities participating in NCPA to involve minority and women business enterprises (MWBE) and historically underutilized businesses (HUB) in the purchase of goods and services. Respondents shall indicate below whether or not they are an M/WBE or HUB certified.
§ Minority / Women Business Enterprise
• Respondent Certifies that this firm is a M/WBE
§ Historically Underutilized Business
• Respondent Certifies that this firm is a HUB
¨ Residency
Ø Responding Company’s principal place of business is in the city of , State of
¨ Felony Conviction Notice
Ø Please Check Applicable Box;
A publically held corporation; therefore, this reporting requirement is not applicable.
Is not owned or operated by anyone who has been convicted of a felony.
Is owned or operated by the following individual(s) who has/have been convicted of a felony
Ø If the 3rd box is checked, a detailed explanation of the names and convictions must be attached.
¨ Distribution Channel
Ø Which best describes your company’s position in the distribution channel:
Manufacturer Direct Certified education/government reseller Authorized Distributor Manufacturer marketing through reseller Value-added reseller Other:
¨ Processing Information
Ø Provide company contact information for the following:
§ Sales Reports / Accounts Payable
Contact Person:
Title:
Company:
Address:
City: State: Zip:
Phone: Email:
American Somoa Northern Marina Islands
Federated States of Micronesia Puerto Rico
Guam U.S. Virgin Islands
Midway Islands
New Braunfels
Texas
X
X
Kim Valadez
Director, Asset Management
Rush Enterprises
555 I.H. 35 South, Suite 500
New Braunfels
830-302-5691
Texas
[email protected]
78130
§ Purchase Orders
Contact Person:
Title:
Company:
Address:
City: State: Zip:
Phone: Email:
§ Sales and Marketing
Contact Person:
Title:
Company:
Address:
City: State: Zip:
Phone: Email:
¨ Pricing Information
Ø In addition to the current typical unit pricing furnished herein, the Vendor agrees to offer all future product introductions at prices that are proportionate to Contract Pricing. § If answer is no, attach a statement detailing how pricing for NCPA participants would be calculated for future product introductions.
Yes No
Ø Pricing submitted includes the required NCPA administrative fee. The NCPA fee is calculated based on the invoice price to the customer.
Yes No
Ø Vendor will provide additional discounts for purchase of a guaranteed quantity.
Yes No
Brian Dawes
National Account Manager
Rush Enterprises
555 I.H. 35 South, Suite 500
New Braunfels
864-497-3538
Texas
[email protected]
78130
Brian Dawes
National Account Manager
Rush Enterprises
555 I.H. 35 South, Suite 500
New Braunfels
864-497-3538
Texas
dawesb@rushenterprises
78130
X
X
X
Rush Truck Centers of Texas, LP
NCPA Solicitation Number: 25-20
Tab 4 – Vendor Profile
Official Registered Nam and History
Rush Truck Centers of Texas, L.P. is a limited partnership formed in the state of Texas. Rush Truck Centers of Texas, L.P. has two partners: Rushtex, Inc. (a Delaware corporation) is the General Partner and Rushco, Inc. (a Delaware corporation) is the Limited Partner. Rushtex, Inc. and Rushco, Inc. are wholly owned subsidiaries of Rush Enterprises, Inc.
Rush Enterprises, formed in 1965, is a public company traded on NASDAQ under the symbols RUSHA and RUSHB.
Rush Enterprises owns and operates the largest network of heavy- and medium-duty truck dealerships in the United States. It sells and services leading truck and bus manufacturers including Peterbilt, Ford, Hino, Isuzu, Blue Bird, International and IC Bus at over 100 locations in 21 states. Rush operates more than 30 dealerships throughout the state of Texas. Rush Enterprises has over 6,000 employees, with more than 1,500 in Texas.
Rush Enterprises, Inc. operates its dealer network through state-based legal entities. A separate legal entity, with a separate tax id number, has been established for each state in which Rush operates, each of which is a wholly-owned subsidiary of Rush Enterprises.
RTC Texas is an authorized dealer in Texas for Peterbilt, Hino, Isuzu, Ford, Blue Bird, Collins Bus and Elkhart Bus.
Outside of Texas, Rush Enterprises operates dealership locations in 20 additional states that are licensed to sell International and Mitsubishi Fuso in addition to Peterbilt, Hino, Isuzu, Ford, IC Bus and Collins Bus.
Rush Enterprises enjoys a reputation of providing quality commercial vehicles and professional automotive service through professionally staffed and managed operations. The professionals at Rush dealerships are trained by manufacturers and expert automotive consultants in all aspects of financing motor vehicle sales and providing valuable risk management services.
As of September 30, 2020, Rush Enterprises had cash and cash equivalents on its balance sheet of over $259,543 million dollars, and, as of November 3, 2020, Rush Enterprises’ market cap was over $1.5 billion dollars. Additional financial information for Rush Enterprises can be found here: http://investor.rushenterprises.com/results.cfm.
D&B Number
Given that D&B numbers are issued by physical locations and give the large number of Rush locations, D&B numbers will be made available on request.
Organizational Chart
Brian Dawes, National Account Manager for Bus and Public Sector will be the main contact for this Contract. He reports to Robb Nixon, VP Aftermarket Sales. The Legal Contact for this contract will be Michael Lyons, Associate General Counsel. Lastly, Kim Valadez, Director Asset Management will assist in accounts payable.