Morgan Hill City Council
June 15, 2022

Special/Regular Meeting Agenda
City Council
Rich Constantine - Mayor
Gino Borgioli - Mayor Pro Tem
John McKay - Council Member
Yvonne Martinez Beltran - Council Member
Rene Spring - Council Member
Wednesday, June 15, 2022 6:30 PM
Virtual Meeting
Link to join the meeting can be found below

VIRTUAL MEETING GUIDELINES AND PUBLIC COMMENT
In accordance with Executive Order N-25-20 and guidance from the California Department of Public Health on gatherings, remote public participation is allowed.

Physical meetings will not be in the City Council Chamber until further notice.

City Council meetings will be live-streamed on Channel 17, on the City’s website, and on the City’s Facebook page. Those members of the community that would like to participate in the meetings remotely may do so by joining the virtual meeting at:
https://bit.ly/MHCityCouncilMeeting or by calling (669) 900-9128, then enter the webinar id: 873 3200 8380#.

Public comment may be provided in the following ways:
 Join the virtual City Council meeting via the link above, when public comment is opened, raise your virtual hand and be called upon to speak for up to 3 minutes (YOU MUST BE RUNNING THE MOST CURRENT VERSION OF ZOOM TO BE

UNMUTED)
 Join the virtual meeting by calling the number above, dial *9 to raise your hand, and be called upon to speak for up to 3 minutes
 Send public comments in writing to the City Clerk at
[email protected]
* Please note that comments made on Facebook are not considered public comment.

SPECIAL/REGULAR MEETING

June 15, 2022
2 A special meeting of the City Council is called at 6:30 p.m. for the purpose of conducting a closed session.

SPECIAL MEETING
6:30 P.M. Closed Session

CALL TO ORDER

ROLL CALL ATTENDANCE

DECLARATION OF POSTING AGENDA

CLOSED SESSION

OPPORTUNITY FOR PUBLIC COMMENT

ADJOURN TO CLOSED SESSION
Conference with Legal Counsel - Existing Litigation
Authority: Pursuant to CA Govt. Code Section 54656.9(a).

Case Name: Rios v. City of Morgan Hill
Case Numbers: Workers’ Compensation Claim No: MHL2100014

REGULAR MEETING
7:00 P.M.

PROCLAMATIONS
Proclaiming June 19, 2022, as Juneteenth
Proclaiming Thursday, June 23, 2022 as the 50th Anniversary of Title IX of the Education Amendments of 1972
Proclaiming the week of June 12-18, 2022 as Flag Week

PRESENTATIONS
YAC Presentation - Asset #7, 25, 33 - Community Values Youth, Reading for Pleasure, and Interpersonal Competence

June 15, 2022
3 CITY COUNCIL REPORTS
Council Member Spring

CITY MANAGER'S REPORT
Teammate Recognitions

CITY ATTORNEY'S REPORT

OTHER REPORTS

PUBLIC COMMENT
This opportunity for public comment is for items that are not on the agenda. If you would like to make comments on an item that is on the agenda, please wait until we get to that item to offer your comments. Members of the public are entitled to address the City Council concerning any item within the Morgan Hill City Council’s subject matter jurisdiction. Public comments are limited to no more than three minutes. Except for certain specific exceptions, the City Council is prohibited from discussing or taking action on any item not appearing on the posted agenda. Public comment is intended for comments. Questions posed during public comment are not generally answered. If you have questions, please send them to the City Clerk at
[email protected] to receive a response. (See additional noticing at the end of this agenda)

ADOPTION OF AGENDA

CONSENT CALENDAR
Items appearing on the Consent Calendar are considered routine and may be approved by one motion. Pursuant to City Council Policies and Procedures (CP 97-01), any member of the Council or public may request to have an item removed from the Consent Calendar for comment and action.

Time Estimate for Consent Calendar: 1 - 10 Minutes

1. APPROVE LEADERSHIP MORGAN HILL GATEWAY SIGN ART PROPOSAL Recommendation:

Approve the proposed art for newly proposed gateway signs in Morgan Hill.

2. APPROVE ARTISTS FOR MORGAN HILL MAGICAL BRIDGE
Recommendation:

June 15, 2022
4 1. Approve the selection of artist Taylor Gallegos for development and installation of artwork on the restroom at the Morgan Hill Magical Bridge Playground;

2. Approve the selection of artist Lina Velasquez for development and installation of artwork on the utility boxes at the Morgan Hill Magical Bridge Playground;

3. Authorize the City Manager to execute and administer artist agreements for the artwork; and

4. Authorize the sub-committee of the Library, Culture and Arts Commission to work with the artists to finalize the proposed artwork to be installed.

3. APPROVE A REIMBURSEMENT AGREEMENT WITH RAHMATOLLAH

AHMADI FOR THE UNDERGROUNDING OF OVERHEAD UTILITIES ALONG

CORY LANE
Recommendation:

1. Approve a Reimbursement Agreement with Rahmatollah Ahmadi; and

2. Authorize the City Manager to execute the Reimbursement Agreement.

4. APPROVE CONSULTANT AGREEMENT WITH HOUSEKEYS, INC FOR

BELOW MARKET RATE (BMR) ADMINISTRATION SERVICES
Recommendation:

1. Approve Consultant Agreement for BMR services through June 30, 2024, for an additional $550,000 each year, totaling $1,100,000 from July 1, 2022– June 30, 2024; and

2. Authorize the City Manager to execute and administer the contract.

5. APPROVE AGREEMENT WITH SECURE SOLUTIONS INC. FOR

BACKGROUND INVESTIGATION SERVICES
Recommendation:

Approve agreement and authorize City Manager to execute and administer the agreement with Secure Solutions Inc. for an amount not to exceed $200,000 to conduct hiring background investigations of Police Department and Information Technology personnel.

6. APPROVE A THREE-YEAR SMALL GOVERNMENT ENTERPRISE

AGREEMENT WITH ENVIRONMENTAL SYSTEMS RESEARCH INSTITUTE,

INC (ESRI) FOR GIS SOFTWARE LICENSING FOR A TOTAL AMOUNT OF $115,500
Recommendation:

June 15, 2022
5 Approve and authorize the City Manager to execute a three-year Small Government Enterprise Agreement with Environmental Systems Research Institute, Inc. (Esri) for GIS software licensing for a total amount of $115,500.

7. APPROVE A THREE-YEAR COLLISION REPAIR SERVICE AGREEMENT

WITH ADVANCED AUTO BODY FOR AN AMOUNT NOT TO EXCEED
$173,400
Recommendation:

Authorize the City Manager to execute and administer the Service Agreement with Advanced Auto Body for an amount not to exceed $173,400 for a period of three years. Advanced Auto Body will furnish collision repair services for the Police Department, Engineering, Utilities, and Community Services' vehicle fleets.

8. APPROVE A THREE-YEAR AGREEMENT WITH THE COUNTY OF SANTA

CLARA (SAN MARTIN ANIMAL SHELTER) FOR ANIMAL SERVICES
Recommendation:

Approve agreement and authorize the City Manager to execute and administer the agreement with the County of Santa Clara (San Martin Animal Shelter) for animal services in the amount of $104,365.65.

9. APPROVE A TEN-YEAR AGREEMENT WITH AXON FOR VARIOUS POLICE

DEPARTMENT EQUIPMENT AND RELATED SERVICES IN THE AMOUNT OF $1,710,607
Recommendation:

1. Approve a 10-year agreement with Axon for the Officer Safety Plan 7 (OSP7) and Fleet 3; and

2. Authorize the City Manager to execute and amend, when necessary, a 10- year agreement with Axon for the Officer Safety Plan 7 and Fleet 3.

10. APPROVE AGREEMENT FOR EXCLUSIVE RIGHT TO NEGOTIATE FOR CITY

OWNED AGRICULTURAL LAND
Recommendation:

Authorize the City Manager to develop, execute, and administer an exclusive right to negotiate with ABC Tree Farms, LLC. for the potential lease of Cityowned agricultural land and work with ABC Tree Farms to include LBJ Farms as a potential operator of a farm stand on the site.

11. APPROVE SOLID WASTE FRANCHISE EXTENSION
Recommendation:

Authorize the City Manager to execute a two-month extension of the franchise agreement with Recology South Valley.

June 15, 2022
6 12. APPROVE CHANGE ORDER FOR $561,050 FOR INCREASED BATTERY

STORAGE FOR CENTENNIAL RECREATION CENTER (CRC) BATTERY

STORAGE PROJECT
Recommendation:

Authorize a change order to increase funding for the CRC Battery storage project by $561,050, for a total of $1,061,050, to increase the battery storage capacity above what was previously awarded.

13. APPROVE THE JUNE 1, 2022 CITY COUNCIL MEETING MINUTES Recommendation:

Approve the June 1, 2022, City Council Meeting Minutes.

14. AUTHORIZE THE CITY MANAGER TO EXECUTE AND AMEND, WHEN

NECESSARY, A NETWORK ARCHITECTURE AND REFRESH PROJECT

WITH CADENCE TEAM SUBJECT TO APPROVAL AS TO FORM BY THE CITY ATTORNEY IN THE AMOUNT OF $482,294, INCLUDING A
CONTINGENCY OF $43,845
Recommendation:

Authorize the City Manager to execute and amend, when necessary, a network architecture and refresh project with Cadence Team subject to approval as to form by the City Attorney in the amount of $482,294, including a contingency of $43,845.

15. AWARD OUTDOOR PEST CONTROL SERVICE AGREEMENT TO ANIMAL DAMAGE MANAGEMENT, INC. FOR A TOTAL OF $90,960
Recommendation:

1. Award a two-year agreement to Animal Damage Management, Inc. in the amount of $90,960; and

2. Authorize the City Manager to execute and administer the Service Agreement with Animal Damage Management, Inc.

16. RECEIVE MONTHLY BUDGET UPDATE, AND APRIL 2022 FINANCIAL AND

INVESTMENT REPORTS
Recommendation:

Accept and file report.

PUBLIC HEARINGS

17. ADOPT THE FISCAL YEAR (FY) 2022-23 AND 2023-24 OPERATING

June 15, 2022
7 BUDGET, FY 2022-23 AND 2027-28 CAPITAL IMPROVEMENT PROGRAM BUDGET, FY 2022-23 APPROPRIATIONS LIMIT, ADOPT THE REVISED

SALARY SCHEDULES FOR POLICE OFFICERS ASSOCIATION (POA),

COMMUNITY SERVICE OFFICERS ASSOCIATION (CSOA), AMERICAN

FEDERATION OF STATE, COUNTY, AND MUNICIPAL EMPLOYEES
(AFSCME), AND MANAGEMENT, PROFESSIONAL, AND CONFIDENTIAL EMPLOYEES EFFECTIVE JUNE 26, 2022, AND ADOPT THE ELECTED AND COUNCIL APPOINTED SALARY SCHEDULE EFFECTIVE JULY 1, 2021 Recommendation:

1. Open/Close Public Hearing;

2. Adopt resolution to:
a. Adopt the FY 2022-23 and 2023-24 Operating Budget;
b. Adopt the FY 2022-23 through 2027-28 Capital Improvement Program Budget; and
c. Adopt the 2022-23 Appropriations Limit and Appropriations Limit Adjustment Factors;

3. Approve the FY 2022-23 Community Funding recommendations;

4. Adopt the revised salary schedules for POA, CSOA, AFSCME, and Management, Professional, and Confidential Employees effective June 26, 2022; and

5. Adopt the Elected and Council Appointed Salary Schedule effective July 1, 2021.

OTHER BUSINESS

18. PROVIDE DIRECTION REGARDING DOWNTOWN LANE REDUCTION

IMPLEMENTATION
Recommendation:

Receive update on Downtown Lane Reduction project and Butterfield Lane optimization and provide direction.

FUTURE COUNCIL INITIATED AGENDA ITEMS
Note: in accordance with Government Code Section 54954.2(a), there shall be no discussion, debate and/or action taken on any request other than providing direction to staff to place the matter of business on a future agenda.

ADJOURNMENT

June 15, 2022
8 NOTICE
Any documents produced by the City and distributed to the majority of the City Council less than 72 hours prior to an open meeting, will be made available for public inspection at the City Clerk’s Counter at City Hall located at 17575 Peak Avenue, Morgan Hill, CA, 95037 and at the Morgan Hill Public Library located at 660 West Main Avenue, Morgan Hill, California, 95037 during normal business hours. (Pursuant to Government Code 54957.5)

PUBLIC COMMENT
Members of the Public are entitled to directly address the City Council concerning any item that is described in the notice of this meeting, before or during consideration of that item. If you wish to address the Council on any issue that is on this agenda, please complete a speaker request card located in the foyer of the Council Chambers and deliver it to the Minutes Clerk prior to discussion of the item. You are not required to give your name on the speaker card in order to speak to the Council, but it is very helpful.

When you are called, proceed to the podium and the Mayor will recognize you. If you wish to address the City Council on any other item of interest to the public, you may do so during the public comment portion of the meeting following the same procedure described above. Please limit your comments to three (3) minutes or less.

Please submit written correspondence to the Minutes Clerk, who will distribute correspondence to the City Council.

Persons interested in proposing an item for the City Council agenda should contact a member of the City Council who may plan an item on the agenda for a future City Council meeting. Should your comments require Council action, your request may be placed on the next appropriate agenda. Council discussion or action may not be taken until your item appears on an agenda. This procedure is in compliance with the California Public Meeting Law (Brown Act) Government Code §54950.

City Council Policies and Procedures (CP 03-01) outlines the procedure for the conduct of public hearings. Notice is given, pursuant to Government Code Section 65009, that any challenge of Public Hearing Agenda items in court, may be limited to raising only those issues raised by you or on your behalf at the Public Hearing described in this notice, or in written correspondence delivered to the City Council at, or prior to the Public Hearing on these matters.

The time within which judicial review must be sought of the action by the City Council, which acted upon any matter appearing on this agenda is governed by the provisions of Section 1094.6 of the California Code of Civil Procedure.

For a copy of City Council Policies and Procedures CP 97-01, please contact the City Clerk’s office (408) 779-7259, (408) 779-3117 (fax) or by email [email protected].

AMERICANS WITH DISABILITIES ACT (ADA)
In compliance with the Americans with Disabilities Act, if you are a disabled person and you need a disability-related modification or accommodation to participate in this meeting, please contact the City Clerk's Office at (408)779-7259, (408)779-3117 (fax) or by email [email protected]. Requests must be made as early as possible and at least two-full business days before the start of the meeting.

June 15, 2022
9

City Manager’s
Recognition Report

New Hires
1 Spring Andrews
Information Technology
Director
Brittney Sherman
Economic Development
Coordinator
Kendra Mann
Environmental
Programs Coordinator
Danielle Maak
Information Technology
Technician
Kathryn Pisano
Environmental Services
Manager
Greg Garrett
Programmer Analyst

New Hires
2 Suzie Nguyen
Aquatics Coordinator
Brian Malicdem
Unhoused Specialist
Martin Mejia
Utility Worker I
Corey Moralez
Facilities Maintenance
Specialist
Molly Fittro
Aquatics Supervisor
Roshni Saxena
Assistant Planner

New Hires
3 Bridget Perez-Galindo
Police Officer
Sarah Tada
Police Support Services
Manager
Nathaniel Rodriguez
Police Officer

New Promotions
4 Michelle Bigelow
City Clerk/Public Information Officer
Isabel Arevalo
Senior Police Records Specialist
Sean Bayard
Police Sergeant
Todd Davis
Police Corporal

Retirements
5 Sergio Jauregui
Facilities Maintenance Specialist
Lisa Rick
Recreation Services Coordinator
Tony Eulo
Program Administrator
Dale Dapp
Maintenance Manager

1 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Chris Ghione, Public Services Director
APPROVED BY: City Attorney

APPROVE LEADERSHIP MORGAN HILL GATEWAY SIGN ART

PROPOSAL

RECOMMENDATION(S)
Approve the proposed art for newly proposed gateway signs in Morgan Hill.

Estimated Time: na

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Supporting our Youth, Seniors, and Entire Community
2022-2023 Strategic Priorities
Community Outreach, Engagement, and Messaging
REPORT NARRATIVE:

On April 20, 2022, the City Council approved the installation of new gateway signage (Attachment 1) at two locations (Attachment 2) by the current Class of Leadership Morgan Hill. The Class has proposed the installation of the two monument signs along Monterey Road. The locations for the monument signs are at the northwest corner of the intersection of Monterey Road and old Monterey Road and the southeast corner of the intersection of Monterey Road and Butterfield Boulevard.

In addition to the monument sign, the class has proposed artwork for the rear side of the signs. At the April 20 meeting, the artwork had not yet been provided, but is now available for review by the City Council. The proposed artwork is included as Attachment 3. The proposed artwork is a reuse of previous temporary artwork that was commissioned by the City from Debbie Arambula (often referred to as the heart artist).

The previous artwork was created in a temporary fashion on plywood for use with the construction work occurring during the downtown renovation several years ago. Since the artwork is to be used in a permanent fashion on the back side of the permanent monument sign, it requires a recommendation from the Library, Culture and Arts Commission and approval by the City Council. Debbie Arambula has agreed to allow the use of the artwork with the signs at no cost. On June 7, 2022, the Commission reviewed the art and recommended approval by the City Council.

1 COMMUNITY ENGAGEMENT:

Empower
The project was brought forward by community members enrolled in the Leadership Morgan Hill (Class) and will be implemented by these community members. Since the artwork is a proposed reuse of art that is already completed, no input was provided to the artist regarding development of the art at this time.

ALTERNATIVE ACTIONS:

The City Council could choose not to approve the artwork and provide additional direction to City staff.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The City Council approved the installation of the Gateway signs on April 20, 2022.

FISCAL AND RESOURCE IMPACT:

The installation of the monument signs in the proposed location, including the artwork, is not anticipated to create significant ongoing operational expenses. The maintenance of the signs themselves shall be limited to graffiti removal and repair associated with the signs.

CEQA (California Environmental Quality Act):

Categorical Exemption
Minor alterations to existing City facilities, including the installation of signs, falls within the CEQA categorical exemption of Class 1, Existing Facilities.

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Monterey Road
Old
Monterey Road

4/13/22 CG
3XEOLF6HUYLFHV'HSDUWPHQW /HDGHUVKLS0+6LJQ/RFDWLRQV 2 2
Monterey Road
Butterfield Road

2 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Chris Ghione, Public Services Director
APPROVED BY: City Manager

APPROVE ARTISTS FOR MORGAN HILL MAGICAL BRIDGE

RECOMMENDATION(S)

1. Approve the selection of artist Taylor Gallegos for development and installation of artwork on the restroom at the Morgan Hill Magical Bridge Playground;

2. Approve the selection of artist Lina Velasquez for development and installation of artwork on the utility boxes at the Morgan Hill Magical Bridge Playground;

3. Authorize the City Manager to execute and administer artist agreements for the artwork; and

4. Authorize the sub-committee of the Library, Culture and Arts Commission to work with the artists to finalize the proposed artwork to be installed.

Estimated Time:

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Supporting our Youth, Seniors, and Entire Community
Guiding Documents
Bikeways, Trails, and Recreation Master Plan
REPORT NARRATIVE:

In 2021, the City of Morgan Hill issued a call for artists to submit proposals for the design, fabrication, and installation of public art at the planned Morgan Hill Magical Bridge Playground. This project seeks to create a new mural on the new restroom building located within the Playground. The City of Morgan Hill had set a limit on funding for the mural project at $10,000 with a goal to create an art piece on the newly installed restroom within the Playground. The City and Commission had previously worked with an artist to complete artwork on a similar restroom in Railroad Park. Construction of the park is nearing completion and opening of the park occurred on June 4, 2022. The funding is intended to cover all project costs including design, fabrication, and installation.

The City received two proposals from artists, Taylor Gallegos (Attachment 1) and Lina

2 Valesquez (Attachment 2). A sub-committee of the Library, Culture and Arts Commission and the Parks and Recreation Commission provided the initial review of the artwork and conducted interviews with the artists. The Sub-committee felt both artists could do the job but are recommending Taylor Gallegos as the selected artist based on his proposal, experience, and belief his artwork could be adjusted to best fit within the Playground and specifically, the restroom building. The Committee further recommended that Taylor work with the Commission, youth, and City staff to adjust a concept that focuses the subject of the artwork on the nature of the State of California, including Morgan Hill. The artist was open to this idea and excited about engaging. The full Commission agreed with these recommendations and has recommended award of the project to Taylor Gallegos.

After reviewing the proposals, staff and the Sub-committee discussed opportunities for Lina Valaesquez to take on paid work for the City. Lina is a local artist out of Gilroy and has provided significant work for the City in the past. The Commission is further recommending that the Council approve awarding an agreement for the development of art on the utility boxes at the Playground. There are two boxes within the playground and one box outside the playground that could benefit from the artwork. Should the Council agree with this recommendation, City staff and the Sub-committee of the Commission would work with Lina to develop the art for the Playground. It is important to note that the subject of the art would be developed to match the Playground and would not be the art Lina had proposed for the restroom building.

COMMUNITY ENGAGEMENT:

Involve
If approved, the Sub-committee of the Library, Culture and Arts Commission will work with the artists to engage participants visiting the Playground to solicit comments and feedback on the artwork. This feedback will be incorporated into the final development of the artwork.

ALTERNATIVE ACTIONS:

The Council may choose not to move forward with the recommended actions, move forward with only one of the artists, or provide other alternative direction to City staff.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The Library, Culture and Arts Commission recommended approval for both artists to complete the work required on June 7, 2022.

FISCAL AND RESOURCE IMPACT:

The proposed artists agreements would include funding of $10,000 for the restroom art and $3,000 for the utility box art. Funding for the artwork is included in the Magical Bridge Project Budget within the Park Impact Fund (301).

CEQA (California Environmental Quality Act):

Categorical Exemption

2 Minor alterations to existing City facilities fall within the CEQA categorical exemption of Class 1, Existing Facilities.

Morgan Hill
Magical Bridge
Playground
Proposal for the Design, Fabrication, and
Installation of Public Art at the Planned Morgan
Hill Magical Bridge Playground
PHOTO: MOUNTAIN VIEW VOICE | MAGALI GAUTHIER

TAYLOR GALLEGOS FINE ART, INC. 2

03. Attachment 1: Application

05. Attachment 2: Artist’s Resume

07. Attachment 3: Proposed Art
Description

09. Attachment 4: Concept Sketch

11. Attachment 5: Statement of
Interest
Summary

13. Attachment 6: Additional Information

14. 6.1 About Us

15. 6.2 Artist’s Design Philosophy

16. 6.3 References

TAYLOR GALLEGOS FINE ART, INC. 3
ATTACHMENT 1:

APPLICATION FORM
“Unity in Community”

TAYLOR GALLEGOS FINE ART, INC. 4
Taylor Gallegos Fine Art Inc.
2635 Madison Street, Apt. 2
Carlsbad, CA 92008
P: (970) 310 - 4436
taylorgallegosart.com
Application – Call for Artists
Morgan Hill Magical Bridge Art Project
Contact Name
Organization Name
(If Applicable)
Address
Email
Phone Numbers
Name of Artist
Description of Art
Being Proposed
(200 Words Max)
Required
Documents
(Provide as
Additional
Attachments)
⃝ Artist Resume (max 2 pages)
⃝ Concept Sketch or Design of Art Being proposed
⃝ Statement of Interest (max 1 page)
Under statement of interest, applicant may describe what motivates him/her to create public art, what attracts him/her to this project.

Optional
Documents
(Provide as
Additional
Attachments)
⃝ Samples of Representative Work (Up to 10 projects with photos of work) ⃝ Other documents necessary to provide artist or proposal background (max 2 pages) Jessica Price
Taylor Gallegos Fine Art (DBA Taylor Gallegos Art)
Taylor Gallegos
My concept for the Morgan Hill Magical Bridge Playground Mural will be wrapping the Restroom building on premises. The design goes as follows.

The artwork is to be wrapped around the 4 walls of the building. With this in mind, the building will be a microcosm of the world. The wall to the North will depict landscapes and animals from the north of our planet, and the same will go with the other three directions.

The design will feature standout landscapes from all the specified directions like Yosemite, the Great Wall of China in the East, Antarctica, and the great Alaskan mountains. The mural will also be populated with animals from all around the globe specific to the region where they live. All of the animals will be lifelike but happy, acknowledging the viewer as much as possible.

The style of the mural will be what I call “Cartoon Realism.” This is a sort of blend of realism, with a slight cartoon feel. The landscapes will look realistic, and the animals will as well while keeping a happy, light, inviting tone. You can see an example of this style in my recent work at Together We Grow.

X
X
X
X
X

TAYLOR GALLEGOS FINE ART, INC. 5
ATTACHMENT 2:

ARTIST’S RESUME
“Flow State”

TAYLOR GALLEGOS FINE ART, INC. 6
Profile
Taylor Gallegos Art is a mural company featuring custom art by artist Taylor Gallegos. Based in Carlsbad, California, I create large-scale artwork in Southern and Northern California. I’ve got 15 years of professional mural experience along with a Bachelor of Fine Arts with a double concentration in Painting and Drawing. I work in a wide range of styles, and my pricing is competitive. I hold a C33 Contractor’s License in the state of CA, and I use pro-grade paints and materials that guarantee the artwork will last beautifully through time. I work efficiently, neatly, and professionally with quality and client satisfaction being my number one objective.

Notable Professional Experience
Wildtype, San Francisco, CA 2021: 16’ x 80’ logo work
Carlsbad Art Wall, Carlsbad, CA 2021: Rotating local mural Estrella Jalisco Stars, San Diego, CA 2020: 20’ x 30’ stylized portrait Together We Grow, Temecula, CA, 2020: Entire school, various landscapes with animal life
Sony Playstation HeadQuarters, CA, 2019: 13’ x 30’ abstract painting Rescale, San Francisco, CA, 2019: 10’ x 20’ jet schematic and racecar image Modsy, San Francisco, CA, 2019: 3 large interior murals, portraits and cityscape Nasty Gal, Los Angeles, CA, 2019: 15’ x 30’ ombre fades of color Da Vanti Enoteca, San Diego, CA, 2018: 13’ x 30’ exterior patio mural Enlightened AK, Anchorage, AK, 2017: 15’ x 70’ exterior abstract mural Education
Bachelor of Fine Arts, Colorado
State University, 2006
Study Abroad Semester, Italy, 2004
Certifications
C33 CA Specialty Painter’s
Contractor’s License, 2020
Years of Experience
15 Artist Vitae
Taylor Gallegos

ATTACHMENT 3:

DESCRIPTION

OF PROPOSED ART
“Together We Grow”
TAYLOR GALLEGOS FINE ART, INC. 7

TAYLOR GALLEGOS FINE ART, INC. 8
My concept for the Morgan Hill
Magical Bridge Playground Mural will
be wrapping the Restroom building
on premises. The design goes as
follows
The artwork is to be wrapped around
the 4 walls of the building. With
this in mind, the building will be a
microcosm of the world. The wall
to the North will depict landscapes
and animals from the north of our
planet, and the same will go with the
other three directions. The design
will feature standout landscapes
from all the specified directions like
Yosemite, the Great Wall of China in
the East, Antarctica, and the great
Alaskan mountains. The mural will
also be populated with animals from
all around the globe specific to the
region where they live. All of the
Description of Proposed
Art
animals will be lifelike but happy,
acknowledging the viewer as much as
possible.

The style of the mural will be what
I call “Cartoon Realism.” This is a
sort of blend of realism, with a slight
cartoon feel. The landscapes will look
realistic, and the animals will as well
while keeping a happy, light, inviting
tone. You can see an example of this
style in my recent work at Together
We Grow. Atlantis at Together We Grow
Mural by Taylor Gallegos (Temucala, CA)
Farm Room at Together We Grow
Mural by Taylor Gallegos (Temecula, CA)

TAYLOR GALLEGOS FINE ART, INC. 9
“Tuna School at Together We Grow”
ATTACHMENT 4:

CONCEPT SKETCH

TAYLOR GALLEGOS FINE ART, INC.

Concept SketchProposed Mural

TAYLOR GALLEGOS FINE ART, INC. 11
ATTACHMENT 5:

STATEMENT OF

INTEREST
“Wild Coast”

TAYLOR GALLEGOS FINE ART, INC. 12
I’m extremely interested in the Morgan
Hill Magical Bridge Playground Mural
Project for several reasons. One reason
is that I love the fact that the building
upon which it will be painted is a box
and that the artwork will go all the way
around it, which works perfectly for the
concept I’m proposing. Another reason
is that I love making art for the public,
and more specifically, a wide range of
ages and perspectives, it’s the best. The
main reason for my interest is the close
connection between this project and a
recent project I completed in Temecula,
CA. They tie together beautifully. For
these reasons, and also because of my
unique skill set and qualifications, I feel
that I’m a perfect candidate to create
the artwork for the project.

My first area of interest is based on
the wrapping element of the building.

As you can see with my design, I’m
using the building as a microcosm of
the world. The four sides will act as
our cardinal directions that will then
lay out the imagery connected to that
part of the planet. Each side will be
a depiction of some of the incredible
landscapes, plants, and animals that our
amazing world has to offer. Each side
will also connect and blend with the
next creating a seamless image that you
could go around and around, finding
new elements each time. Because of
the shape and design, it will be like
having a mini planet on premises for all
to enjoy.

The second reason I’m interested is
the public element. I absolutely love
that the intention for the playground
project is that it’s for everyone. The act
of making art for everyone has a similar
line of thinking. You create for all
people, perspectives, and ability levels.

With that being said, the artwork
should speak to all ages, backgrounds,
and cognitive abilities. The earth and
all its inhabitants is something every
living being has in common. And
when everyone is spoken to, everyone
feels respected and at home.

The main reason for my interest is
that this project is similar to a large
project I completed midway through
2020 at a place called Together
We Grow, which is a recognized
leader in pediatric care. It is a place
where medically fragile and typical
children grow together in an inclusive
environment. I was brought in to
paint all the walls, floor to ceiling
of their new facility in Temecula,
CA. I turned every room into a
unique environment like the arctic,
the tropics, the Far East, a farm, etc.

The intention was to bring these
environments to the children because
they most likely weren’t going to be
able to travel to them. Just knowing
the effect it was going to have on the
children throughout time made it a
favorite project of mine.

To recap, I’m very interested in being
the artist for this project. I think that
the physical design of the project is
awesome and has some really great
advantages. The public element of
this project is so cool because of the
wide range of viewers this artwork
will reach. This mural project will be
a great next step to the work that I’ve
done in the past. Basically, I think
that the project sounds amazing and
I’d love to be a part of it. It will be
beautiful, educational, and enjoyable
for everyone for years to come.

Statement of Interest
“Wisdom of Nature”
Mural by Taylor Gallegos (Carlsbad, CA)

TAYLOR GALLEGOS FINE ART, INC. 13
ATTACHMENT 6:

ADDITIONAL

INFORMATION
Tuscany Room at Together We Grow

Meet Taylor Gallegos, Founder and CEO of Taylor Gallegos Art T A Y L O R G A L L E G O S F I N E A R T , I N C .

TAYLOR GALLEGOS FINE ART, INC. 14
About Us
Taylor Gallegos is a painter specializing in murals,
studio painting, and live art. In general, his work
focuses on unity, connection, love, and creativity.

As a professional artist, his work has ranged from largescale murals to portraits to abstracts in the studio to live art, mostly in the fields of painting and drawing with acrylics and oils. His work with live art has taken him on tour with musicians and has developed into a business
venture in the world of weddings called Live Wedding
Art. In recent years his studio art has developed a focus on environmental and philosophical concepts stretching
into the Life series and through the Meditations and
Abstractions series’.

Taylor is currently living and working in Carlsbad,
California, and is originally from Boulder, Colorado.

He received a Bachelor of Fine Art from Colorado State
University, and during that time, studied abroad in
Castiglion Fiorentino, Italy.

Taylor has been painting and drawing his whole life but has been doing so professionally for the past 15 years. This passion has developed into his current work as a custom muralist, creating large-scale wall murals in different styles for different intentions and causes. This work brings his skill set together with individual people and organizations to bring visions and ideas to life for all to see. His
brush is the instrument that plays the tunes of people’s imaginations.

Taylor created his first mural right after college for a local restaurant and loved the process, although it was a huge undertaking. That restaurant had a handful of locations, so they hired him to decorate all of their interiors. It was a great experience that set the groundwork for lots of
future paintings. Thanks to a muralist mentor, he had the opportunity to dive into the world of mural painting more and more.
i.

TAYLOR GALLEGOS FINE ART, INC. 15
Artist’s Design Philosophy
My art is about the ways we connect.

Every painting is an effort to find
common ground with the viewer.

Whether it be through light and
shadow, color, or the message in the
work, the focus is commonalities.

Artwork transcends borders, skin
color, and material differences. It can
be a tool for good, and that’s my aim.

Light and shadow are a primary
focus of mine. Light and shadow are
key to an image. It’s the first thing
that we see when we observe a 3D
object. It’s how we can recognize a
friend walking a ways away or how
we see out of the corner of our eye
and know exactly who’s there. Light
and shadow build our understanding
of form. These things are essential,
and they fall and reflect on all of us in
precisely the same way, no matter our
background.

Color is something all humans can
relate to. The color palette is a
spectrum that has infinite variation
to it. Color creates effects in us in
terms of emotion and energy, and
combinations work in different ways
I work closely with my clients,
going back and forth on their
concepts and imagery so that
what’s left is a work of art
that is absolutely loved. The
process begins with an idea,
builds to a concept sketch, is
laid out on the wall, and then
brought to life in color.
to achieve different effects. Color is
a metaphor for life on this planet in
terms of the variety and beauty. All of
this and more go into my work.

In terms of the messages, I want to
speak to the highest good in all of
us. I strive to speak about ethics,
morals, and values that unite. I want
my work to fight against injustice and
negativity, but I don’t want to focus
there. Like attracts like. If we want
more good, we need to visualize it,
portray it, and then bring it forth into
reality. These underlying messages
are the backbone of my work and are
central to my mission as an artist.

My paintings come in different
shapes, sizes, and styles but have
a common thread throughout. My
work speaks to the highest forms
of humanity, what’s good in all of
us. My work visualizes a bright and
colorful reality where all are equal,
and beauty is fostered and stewarded
into being. My painting is about that
common energy which we all feel and
understand on a deeper level. It’s all
about our human connection.
“Soul of Tequila”
Mural by Taylor Gallegos (Oceanside, CA)

“Flow State”
Mural by Taylor Gallegos (Carlsbad, CA)
President, Togetger We Grow
(619) 778-2940 I [email protected]
Terry Racciato
Terry is the president of Together We Grow, a pediatric care facility in San Diego and Riverside counties.

These are facilities where medically fragile and typical children grow together in an inclusive environment. I
have worked with Terry on multiple projects at two of
their locations, the most recent being a full build out in Temecula. Terry and I worked very closely every step of the way to create the artwork in exactly the ways that
she was hoping with the intention always being to bring the best experience possible to the children.

TAYLOR GALLEGOS FINE ART, INC. 16
References
Local Artist, Coordinator of Local
Carlsbad Art
(760) 521-8713 I [email protected]
Bryan Snyder
Bryan is a local Carlsbad artist I’ve been following for years, even before I moved to the village 3 years ago. I put my name on the list to do the Carlsbad Art Wall at
Senor Grubby’s as soon as I moved to town, and got
the call for March of 2021. We worked back and forth to develop and refine my design so that it was perfect for the community it would be nestled in. Bryan has been
running the rotating art wall for 7 years now, and was
great to work with.

Director of Operations, Beautify
Earth
(330) 780-6090 I [email protected]
Moral Masuoka
Moral was my contact at Beautify Earth for the Estrella Jalisco ``Local Stars” project. Estrella Jalisco partnered with Beautify Earth to get the mural part of the
campaign carried out. Beautify Earth is a non-profit
platform that connects sponsors, building owners
and artists, and guides them through the process of
designing, painting and paying for murals and public art.

Moral was my connection to the subject of my painting,
Estrella Jalisco, and the city of San Diego.

Contact Name
Application - Call for Artists
Morgan Hill Magical Bridge Art Project -------------
Organization Name
(If Applicable) I,.) AAddress
-----r----------------------------1
Email
Phone Numbers
Name of Artist
Description of Art
Being Proposed
(200 Words Max)
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Q>,tist Resume (max 2 pages)

3 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Charlie Ha, Supervising Civil Engineer
APPROVED BY: City Manager

APPROVE A REIMBURSEMENT AGREEMENT WITH RAHMATOLLAH

AHMADI FOR THE UNDERGROUNDING OF OVERHEAD UTILITIES

ALONG CORY LANE

RECOMMENDATION(S)

1. Approve a Reimbursement Agreement with Rahmatollah Ahmadi; and

2. Authorize the City Manager to execute the Reimbursement Agreement.

Estimated Time:

COUNCIL PRIORITIES, GOALS & STRATEGIES
Guiding Documents
Morgan Hill 2035 General Plan
REPORT NARRATIVE:

The San Pedro - Ahmadi Project is a 3-lot residential subdivision located on the southeast corner of the San Pedro Avenue and Cory Lane intersection (see Attachment 1) that has been in the development process since 2004. As part of the project's conditions of approval, the developer, Rahmatollah Ahmadi, was required to underground the overhead utilities along the project’s frontage on San Pedro Avenue and Cory Lane.

Subsequently, City staff determined that it was not reasonable to require the developer to underground the overhead utilities along San Pedro Avenue given the short distance.

Instead, the developer was conditioned to pay the City's undergrounding in-lieu fee for the project frontage along San Pedro Avenue. Additionally, the developer agreed to work with the City to underground the overhead utilities along the full length of Cory Lane with the understanding that the cost for this work would be shared by the developer and the City as follows:
- The developer to pay for all costs associated with undergrounding the overhead utilities along the Cory Lane project frontage, which is a distance of 166 feet. - The City to reimburse the developer for undergrounding the remaining overhead utilities along Cory Lane; which is a distance of 229 feet.

3 Instead of paying the undergrounding in-lieu fee to the City for San Pedro Avenue, it was agreed that these funds would be used to reduce the amount owed by the City to the developer for the City's share of the undergrounding work on Cory Lane. Unfortunately, at the time, City staff did not develop a formal agreement or seek the required approval from the City Council as required for such an agreement. The timing of this occurrence was over a decade in the past. City staff are now seeking approval of the agreement for this past omission.

The following table shows the breakdown of the construction cost for undergrounding the overhead utility lines along Cory Lane, the amount to be reimbursed to the developer, and the undergrounding in-lieu fee owed by the developer for San Pedro Avenue which will be deducted from the reimbursement amount.

Udergrounding of Cory Lane Total Cost Cost for
Developer's
Frontage (166
feet)
Cost for
Reimbursement
Frontage (229 ft)
Design Drawings $11,300 $4,746 $6,554
Electric Contract - PG&E $23,787 $9,991 $13,796
Telecommunications Contract - Frontier $12,727 $5,345 $7,382 Cable Contract – Spectrum $8,132 $3,415 $4,717
Undergrounding Work by Contractor $425,616 $171,981 $253,635 Totals $481,562 $195,478 $286,084
San Pedro frontage underground inlieu fee =
$401/feet x 125 feet = $50,125; in
place of paying this fee, the
reimbursement amount will be
reduced by this fee.
-$50,125
Reimbursement Total $235,959
The total cost for the design, contract, and construction cost of undergrounding the overhead utilities along Cory Lane, south of San Pedro Drive, is $481,562. The total reimbursement amount is $235,959. The cost and construction work has been reviewed and deemed complete. Therefore, staff recommends that the City enter into a Reimbursement Agreement (see Attachment 2) with the developer, Rahmatollah Ahmadi, for a reimbursement amount of $235,959 to cover the construction cost of undergrounding overhead utilities on Cory Lane beyond the project's frontage.

COMMUNITY ENGAGEMENT:

None
No engagement was made in regards to the development of this reimbursement agreement.

3 ALTERNATIVE ACTIONS:

There is no feasible alternative action as the Developer has completed the undergrounding of overhead utility lines along Cory Drive at the City's direction.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On December 20, 2006, the City Council approved the Subdivision Improvements Agreement for the 3-lot residential subdivision. On May 2, 2018, the City Council approved an Amended Subdivision Improvements Agreement.

FISCAL AND RESOURCE IMPACT:

The reimbursement amount of $235,959 for undergrounding of overhead utilities will be funded from the City's Undergrounding Fund (350) and allocated in the FY 2022/23 Capital Improvement Program.

CEQA (California Environmental Quality Act):

Categorical Exemption
The project is categorically exempt from the California Environmental Quality Act Section 15135 - Minor Land Divisions and Class 3 Section 15303 - New Construction.

County of Santa Clara, Sanborn
Engineering and Utilities Department
Land Development Engineering Division

SITE MAP
Cory Lane
south of San Pedro
Document Path: C:\Users\avizcarra\Desktop\Cory Dr.mxd
O
0 80 160 240 320 40
Feet
Cory Lane
San Pedro Ave
Cory Lane
San Pedro
AHMADI
Butterfield Blvd

N:\PROJECTS\DEVELOP\PR0624 San Pedro - Ahmadi\Agreement\Reimbursement Agreement Final - Cory Lane v2.doc

R E I M B U R S E M E N T A G R E E M E N T

RAHMATOLLAH AHMADI
THIS AGREEMENT is made this _____ day of , 2022, by the CITY OF MORGAN HILL, a municipal corporation ("CITY"), and RAHMATOLLAH AHMADI, an individual ("DEVELOPER").

RECITALS
The following recitals are a substantive part of this Agreement:

1. This Agreement is entered into pursuant to City Council approval on June _____, 2022.

2. CITY desired the DEVELOPER to furnish out of tract undergrounding of overhead utilities along Cory Lane south of San Pedro Avenue at the intersection of San Pedro Avenue and Cory Lane.

3. DEVELOPER agreed, at its own cost and expense, to install these improvements ("IMPROVEMENTS").

4. DEVELOPER requests that CITY reimburse it for a portion of the cost incurred for IMPROVEMENTS.

AGREEMENT
THE PARTIES MUTUALLY AGREE AS FOLLOWS:

1. Term of Agreement. This Agreement covers services rendered from the date of building permit issuance for the project until such time as the amount or portion for reimbursement has been paid to DEVELOPER or its designee. This Agreement shall terminate upon full reimbursement.

2. Scope of Project. The Project scope consists of design and installation of undergrounding overhead utilities along Cory Lane.

3. Improvements Provided. IMPROVEMENTS performed by DEVELOPER consisted of the following: Undergrounding 395 feet of overhead utility lines (power, telecommunications, and cable), including 4 residential services drops along Cory Lane south of San Pedro Avenue (see attached Exhibit A). IMPROVEMENTS have been completed to the City’s satisfaction.

4. Compensation. DEVELOPER expended the following amount in construction of IMPROVEMENTS:

4.1 Amount. Four hundred eighty-one thousand five hundred sixty-two dollars ($481,562).

4.2 Portion to be Reimbursed. Two hundred thirty-five thousand nine hundred fifty-nine

N:\PROJECTS\DEVELOP\PR0624 San Pedro - Ahmadi\Agreement\Reimbursement Agreement Final - Cory Lane v2.doc ($235,959) for the out of tract IMPROVEMENTS.

4.3 Payment. CITY shall reimburse DEVELOPER within 30 days of approval of this Agreement by City Council.

4.4 Records of Expenses. DEVELOPER has kept records in which complete and correct entries are made of all construction costs, including overhead, related to IMPROVEMENTS. These records have been made available to CITY to review. .

5. Assignment of Payments.

5.1 Payment Stream. DEVELOPER may assign the payments upon written instruction to CITY as provided in Paragraph 12 below. CITY shall have no liability whatsoever for failure to follow these instructions or for any claim by any entity for the funds or for their assignment.

6. Non-Liability of Officials and Employees of the CITY. No official or employee of CITY shall be personally liable for any default or liability under this Agreement.

7. Non-Discrimination. DEVELOPER covenants there shall be no discrimination based upon race, color, creed, religion, gender, marital status, age, disability, sexual orientation, national origin, or ancestry, in any activity pursuant to this Agreement.

8. Independent Contractor. It is agreed to that DEVELOPER shall act and be an independent contractor and not an agent or employee of CITY.

9. Compliance with Law. DEVELOPER shall comply with all applicable laws, ordinances, codes, and regulations of the federal, state, and local government.

10. Conflict of Interest and Reporting. DEVELOPER shall at all times avoid conflict of interest or appearance of conflict of interest in performance of this Agreement.

11. Notices. All notices shall be personally delivered or mailed, via first class mail to the below listed addresses. These addresses shall be used for delivery of service of process. Notices shall be effective five (5) days after date of mailing, or upon date of personal delivery. a. Address of DEVELOPER is as follows:

Rahmatollah Ahmadi
3629 Bercaw Lane
San Jose CA 95124
b. Address of CITY is as follows: With a copy to:

Public Works Director City Clerk
City of Morgan Hill City of Morgan Hill

N:\PROJECTS\DEVELOP\PR0624 San Pedro - Ahmadi\Agreement\Reimbursement Agreement Final - Cory Lane v2.doc 17555 Peak Avenue 17555 Peak Avenue
Morgan Hill, CA 95037 Morgan Hill, CA 95037

12. Licenses, Permits and Fees. DEVELOPER obtained a City of Morgan Hill Business License, all permits, and licenses as were required by this Agreement.

13. Time of Essence. Time is of the essence in the performance of this Agreement.

14. Limitations Upon Subcontracting and Assignment. Neither this Agreement nor any portion shall be assigned by DEVELOPER without prior written consent of CITY.

15. Authority to Execute. The persons executing this Agreement on behalf of the parties warrant that they are duly authorized to execute this Agreement.

16. Indemnification. DEVELOPER agrees to protect, and hold harmless CITY and its elective or appointive boards, officers, agents, and employees from any and all claims, liabilities, expenses, or damages of any nature, including attorneys' fees, for injury or death of any person, or damage to property, or interference with use of property, arising out of, or in any way connected with performance of the Agreement by DEVELOPER, DEVELOPER'S agents, officers, employees, subcontractors, or independent contractors hired by DEVELOPER. The only exception to DEVELOPER'S responsibility to protect, defend, and hold harmless CITY, is due to the sole negligence of CITY. This hold harmless agreement shall apply to all liability regardless of whether any insurance policies are applicable. The policy limits do not act as a limitation upon the amount of indemnification to be provided by DEVELOPER.

17. Modification. This Agreement constitutes the entire agreement between the parties and supersedes any previous agreements, oral or written. This Agreement may be modified or provisions waived only by subsequent mutual written agreement executed by CITY and DEVELOPER.

18. California Law. This Agreement shall be construed in accordance with the laws of the State of California. Any action commenced about this Agreement shall be filed in the central branch of the Santa Clara County Superior Court.

19. Interpretation. This Agreement shall be interpreted as though prepared by both parties.

N:\PROJECTS\DEVELOP\PR0624 San Pedro - Ahmadi\Agreement\Reimbursement Agreement Final - Cory Lane v2.doc

21. Preservation of Agreement. Should any provision of this Agreement be found invalid or unenforceable, the decision affected only the provision interpreted, and all remaining provisions shall remain enforceable.

IN WITNESS THEREOF, these parties have executed this Agreement on the day and year shown below.

CITY OF MORGAN HILL "DEVELOPER"

RAHMATOLLAH AHMADI
By: ________________________ By:_________________________ Christina J. Turner, City Manager
Date: ____________ Date: ____________
ATTEST: APPROVED AS TO FORM:
______________________________ _______________________________ Michelle Bigelow, City Clerk Donald A Larkin, City Attorney Date: ____________ Date: ____________

N:\PROJECTS\DEVELOP\PR0624 San Pedro - Ahmadi\Agreement\Reimbursement Agreement Final - Cory Lane v2.doc Exhibit A
Undergrounding Overhead Utilities – beyond the project frontage on Cory Lane (229 feet) Reimbursement Amount
Cory Lane - Undergrounding Total Cost
Developer
Frontage (166
feet) Cost
Reimbursement
Frontage (229 ft)
cost
Design Drawings $11,300 $4,746 $6,554
Electric Contract - PG&E $23,787 $9,991 $13,796
Telecommunications Contract - Frontier $12,727 $5,345 $7,382 Cable Contract – Spectrum $8,132 $3,415 $4,717
Undergrounding Work by Contractor $425,616 $171,981 $253,635 Totals $481,562 $195,478 $286,084
San Pedro frontage underground in-lieu fee,
$401/feet x 125 feet = $50,125; in place of
paying this fee, the reimbursement amount
will be reduced by this fee. -$50,125
Reimbursement Total $235,959

4 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Rebecca Garcia, Housing Director
APPROVED BY: City Manager

APPROVE CONSULTANT AGREEMENT WITH HOUSEKEYS, INC FOR

BELOW MARKET RATE (BMR) ADMINISTRATION SERVICES

RECOMMENDATION(S)

1. Approve Consultant Agreement for BMR services through June 30, 2024, for an additional $550,000 each year, totaling $1,100,000 from July 1, 2022– June 30, 2024; and

2. Authorize the City Manager to execute and administer the contract.

Estimated Time: 5 Minutes

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Preserving and Cultivating Public Trust
Enhancing Diversity and Inclusiveness
Advancing Regional Initiatives
2022-2023 Strategic Priorities
Affordable Housing and Homelessness
Guiding Documents
Morgan Hill 2035 General Plan
REPORT NARRATIVE:

The Below Market Rate Housing (BMR) Homeownership and Rental Program helps qualifying buyers and renters obtain affordably priced homes and apartments. The genesis of this program began in 1977 through the program formally known as the Residential Development Control System (RDCS). The homes are typically provided by private market developers based on the affordable requirements of the Inclusionary Housing Ordinance. In the “post Redevelopment Agency (RDA)” and "post RDCS Era," Morgan Hill has evolved to keep pace with the changing environment and rules to ensure that BMR units continue to be delivered to Morgan Hill residents.

Participating homebuyers and renters must be income eligible. Homebuyers must be

4 pre-approved to be able to financially qualify for a fixed-rate, fixed-term mortgage, and must have a minimum 3 percent down payment from their own funds to purchase a home. Applicants are placed in a lottery for an opportunity to purchase or rent a unit when they become available either through new construction or resale/vacancy of an existing unit. Priority in the lottery is provided for eligible buyers who live or work within the city limits. The BMR program helps moderate-income households purchase BMR homes and it helps lower income households to access rental opportunities that are affordable and adequate to their needs. At the time of sale, properties will have a resale affordable restriction recorded on the title in order to preserve the long-term affordability of the unit for an additional 45 years. The BMR monthly rental prices are consistent with the State HCD income guidelines and adjusted for household size.

HouseKeys, Inc. (formerly Nyanda & Associates, LLC) formed HouseKeys in 2015, and teamed up with the City of Morgan Hill in a public-private partnership to incubate housing policy ideas and to develop solutions to administer a Housing Program in a post redevelopment era. This has included long-term management and preservation of the City’s BMR Program. As a Program Administrator, HouseKeys supports the City’s BMR program by offering assistance in Home Ownership, Rental, and Finance Programs. The contract has been sole sourced. HouseKeys possesses unique historical knowledge of the City’s program and remains the single business that can fulfill the comprehensive service requirements of the City’s BMR portfolio.

HouseKeys provides general BMR administration to the City, including the marketing and sale or rental of BMR units, outreach and education, identification and income qualification of homebuyers and renters, general asset management monitoring and compliance, assisting the County Tax Assessor to provide annual BMR valuation updates, and many other activities required to maintain the integrity and sustainability of the BMR program. Additionally, HouseKeys continues to work with the City to identify solutions to the various complex transactional scenarios that arise as a result of administering a robust portfolio with varying historical rules and requirements, “layered” down payment assistance, and various financing structures and sources of funds.

The BMR Program portfolio consists of a total of 587 owner-occupied units, with approximately 79 for sale new units in the development pipeline. These numbers exclude the number of resale units that are processed each year. The BMR rental portfolio currently consists of 15 rental units with an additional 78 new BMR rental units under construction. The Program continues to require additional focus on asset management, education, monitoring, and compliance to maintain integrity and guarantee sustainability of the Program. With a 40+year program that currently has over 600 BMR properties spread out in over 89 subdivisions, Morgan Hill has one of the region's oldest, largest, rapidly growing affordable housing portfolios.

The expertise that HouseKeys has provided the City has created a valuable partnership, while providing ongoing opportunities to continue to fine tune the BMR program.

Consistent with the budget, it is recommended that Council approve the HouseKeys agreement for continued BMR administration services through June 30, 2024, for $550,000 each year, totaling $1,100,000.

4 COMMUNITY ENGAGEMENT:

This report serves to inform the community on the proposed consultant agreement with HouseKeys.

ALTERNATIVE ACTIONS:

The Council could choose not to approve the proposed contract. Should Council not approve the proposed contract, staff asks that Council provide further direction regarding the management of the BMR program or, alternatively, direct staff to return to Council with alternative options for management.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On July 15, 2015, the Council adopted a transition plan to contract with Nyanda & Associates (HouseKeys) to provide the continued administration of the BMR program.

On May 18, 2016, the Council approved an agreement with HouseKeys for BMR administration services for FY 2016-17 for $500,000.

On December 7, 2016, the Council approved a contract amendment which extended HouseKeys BMR administration contract through FY 2017-18 for an additional $500,000. Additionally, at that time, loan administration services were added to Housekey’s scope of work for FY 2016-17 and 2017-18 for $50,000 in total.

On May 16, 2018, the Council approved an agreement with HouseKeys for BMR Administration for FY 2018-19 and FY 2019-20 in the amount of $1,050,000.

On June 2, 2021, the Council approved the HouseKeys agreement for BMR administration services through June 30, 2022, for $550,000 each year.

FISCAL AND RESOURCE IMPACT:

The contract is funded from the Housing Fund 255. The total cost of this contract (FY 2022-23 through FY 2023-24) is not to exceed $1,100,000 and has been included in the Recommended Budget.

CEQA (California Environmental Quality Act):

This is not a Project; it is an administrative activity that will not result in direct or indirect physical changes in the environment.

1 Updated March 2022

CONSULTANT AGREEMENT
HOUSEKEYS, INC.

THIS AGREEMENT is entered into and becomes effective on _______________ (Effective Date), by and between the CITY OF MORGAN HILL, a municipal corporation, ("CITY"), and HOUSEKEYS, INC. a California corporation ("CONSULTANT") hereinafter referred to collectively as “Parties.” In consideration of the promises and the mutual covenants contained in this Agreement, the Parties agree as follows:

1. City Authority. This Agreement is entered into pursuant to the action of the Morgan Hill City Council taken on ___________, ____, 20___.

2. Term of Agreement. This Agreement shall cover services rendered from the Effective Date of this Agreement until June 30, 2024 at which time CONSULTANT’S services shall be completed. The City Manager is authorized to extend the term of this Agreement for a maximum period of one year. Any such extension shall be in writing and signed by both Parties to this Agreement.

3. Scope of Service. The services to be performed by CONSULTANT shall be administer Morgan Hill's Below Market Rate Ownership and Rental Housing Program as further described in Exhibit A.

4. Compensation. CONSULTANT shall be compensated as follows:

4.1. Amount. $1,100,000.00. Total compensation to CONSULTANT under this Agreement during its initial term set forth in Section 2 above shall not exceed one million - one hundred thousand dollars and shall be billed based on the rate and basis set forth in Exhibit B. If the City Manager extends the term of this Agreement for up to one year pursuant to the provisions of Section 2 above, the City Manager shall have the authority to increase the maximum compensation allowed to be paid to CONSULTANT, so long as City Council has appropriated sufficient funds therefor, the Parties mutually agree to such amount in a writing signed by both Parties to this Agreement and provided further that in no event shall such maximum compensation allowed for the term exceed the City Manager's authority pursuant to Chapter 3.04 of the Morgan Hill Municipal Code, unless otherwise authorized by City Council.

4.2. Billing. CONSULTANT shall provide CITY with an invoice containing the dated, detailed, and itemized descriptions of all services performed and expenses incurred (if such expenses are reimbursable pursuant to Exhibit B) by CONSULTANT on a monthly basis unless otherwise specified in Exhibit B. All invoices shall be sent to the CITY addressed to the department head or project manager identified below in Section 13 Notices. Any rate charged shall be prorated where services are interrupted or not provided for any rate period (for example, any monthly rate charge should be prorated when services were interrupted or provided for only part of the month). For services billed on an hourly rate, the minimum unit of billed time shall not exceed one tenth of one hour. CITY shall pay for services and expenses (if so provided in Exhibit B) up to the limit of compensation set forth above, that in the CITY’s judgment were necessary and reasonable. Services for work performed and expenses incurred in excess of the total compensation set forth in paragraph 4.1 above shall be at no cost to CITY.

5. Termination. CITY or CONSULTANT shall have the right to terminate this Agreement, without cause, by giving thirty (30) days' written notice or less under urgent circumstances. Upon such termination, CONSULTANT shall submit to CITY an itemized statement of services performed for which compensation has not been paid. CITY may require CONSULTANT to complete certain work product or documents and CONSULTANT shall deliver to CITY all documents in its possession without additional compensation to DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

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CONSULTANT. The City Manager of CITY is authorized to terminate this Agreement, in whole or in part, on behalf of CITY.

5.1. Non-Appropriations. Notwithstanding anything contained in this Agreement to the contrary, if insufficient funds are appropriated, or funds are otherwise unavailable in the budget for CITY for any reason whatsoever in any fiscal year, for payments due under this Agreement, CITY will immediately notify CONSULTANT of such occurrence, and this Agreement shall terminate after the last day during the fiscal year for which appropriations shall have been budgeted for CITY or are otherwise available for payments.

6. Performance of Work. CONSULTANT represents that it is qualified by virtue of experience, training, education, and expertise to accomplish these services. Services shall be performed by CONSULTANT in accordance with professional practices in a manner consistent with a level of care, competence and skill exercised by qualified members of the CONSULTANT’S profession. By delivery of completed work, CONSULTANT certifies that the work conforms to the requirements of this Agreement and all applicable federal, state and local laws. CONSULTANT shall perform all work and services under this Agreement in conformance with the time schedule set forth on Exhibit C, "Schedule of Performance," attached hereto and incorporated herein by this reference. CITY's City Manager is authorized on behalf of CITY to modify the timeframes set forth on the Schedule of Performance within the term of this Agreement. If CONSULTANT desires to leave or store any of CONSULTANT's equipment at a CITY site while CONSULTANT is performing work or service pursuant to this Agreement, CONSULTANT will first obtain the consent of CITY's City Manager, or his/her delegate, to do so, and any such storage shall occur only in the manner and location allowed by such CITY official and entirely at CONSULTANT's sole risk.

7. Insurance Requirements. CONSULTANT shall procure and provide proof of the insurance coverage required by this section in the form of certificates and endorsements. The required insurance must cover the activities of CONSULTANT, including its subcontractors, employees and agents, relating to or arising from the performance of any work or service under this Agreement, and must remain in full force and effect at all times during the period covered by this Agreement. The coverages may be arranged under a single policy for the full limits required or by a combination of underlying policies with the balance provided by excess or “umbrella” policies, provided each such policy complies with the requirements set forth herein. Any deductibles or self-insured retentions must be declared to and approved by City. CONSULTANT further understands that the CITY reserves the right to modify the insurance requirements set forth herein, with thirty (30) days’ notice provided to CONSULTANT, at any time as deemed necessary to protect the interests of the CITY.

7.1. Insurance Types and Amounts.

7.1.1. Commercial General Liability (CGL). CONSULTANT shall maintain CGL against claims and liabilities for personal injury, death, or property damage providing protection in the minimum amount of: (i) one million dollars ($1,000,000.00) combined single limit for any one accident or occurrence, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT's combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.1.2. Automobile Liability. CONSULTANT shall maintain Automobile Liability covering all owned, non-owned and hired automobiles (if CONSULTANT does not own automobiles, then CONSULTANT shall maintain Hired/Non-owned Automobile Liability) against claims and liabilities for personal injury, death, or property damage providing protection in the minimum amount of: (i) one million dollars ($1,000,000.00) combined single limit for any one accident or occurrence, or (ii) the maximum amount DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

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of such insurance available to CONSULTANT under CONSULTANT's combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.1.3. Workers’ Compensation Insurance and Employer’s Liability. CONSULTANT shall maintain Workers Compensation coverage, as required by law, in the minimum amount of: (i) one million dollars ($1,000,000.00) for any one accident or occurrence, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT's combined insurance policies (including any excess or “umbrella” policies), whichever is greater. If CONSULTANT is self-insured, CONSULTANT shall provide its Certificate of Permission to Self-Insure, duly authorized by the Department of Industrial Relations.

7.1.4. Pollution (Environmental) Liability. If the performance of CONSULTANT’S work or service under this Agreement involves hazardous materials, contaminated soil disposal, and/or a risk of accidental release of fuel oil, chemicals or other toxic gases or hazardous materials, CONSULTANT shall procure and maintain Pollution Liability covering the CONSULTANT’S liability for bodily injury, property damage and environmental damage resulting from pollution and related cleanup costs arising out of the work or services to be performed under this Agreement. Coverage shall be provided for both work performed on site, as well as during the transport of hazardous materials.

Such coverage shall be in the minimum amount of: (i) one million dollars ($1,000,000.00) for any one accident or occurrence, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT's combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.1.5. Professional Liability.

7.1.5.1. If the performance of CONSULTANT’s work or service under this Agreement involves professional and/or technical services (examples include, but are not limited to, architects, engineers, land surveyors, and appraisers), CONSULTANT shall procure and maintain either a claims made or occurrence Errors and Omission liability insurance in the minimum amount of: (i) one million dollars ($1,000,000.00) each claim, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT's combined insurance policies (including any excess or “umbrella” policies), whichever is greater. Further, if CONSULTANT maintains a claims-made policy, CONSULTANT shall provide written evidence of such insurance to the CITY for at least five (5) years after the completion of work performed under this Agreement.

7.1.5.2. If the performance of CONSULTANT’s work or service under this Agreement relates to Information Technology or related services (examples include, but are not limited to computer programmers, software designers, hardware engineers, or other systems consultants), CONSULTANT shall procure and maintain a claims made Errors and Omission liability insurance, including Cyber Liability and Data Breach, in the minimum amount of: (i) one million dollars ($1,000,000.00) each claim, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT's combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.1.6. Sexual Abuse/Molestation Liability (SML): If the performance of CONSULTANT's work or service under this Agreement involves contact with minors, CONSULTANT shall DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

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procure and maintain Sexual Abuse and Molestation insurance in the minimum amount of: (i) two hundred thousand dollars ($200,000.00) each claim, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT's combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.1.7. Crime/Fidelity Bond. If the performance of CONSULTANT’S work or service under this Agreement relates to or involves handling of CITY monies, CONSULTANT shall procure and maintain Crime insurance, in the minimum amount of: (i) three hundred thousand dollars ($300,000.00) per occurrence, covering all CONSULTANT’S officers and employees, for loss of CITY monies caused by dishonesty and/or theft.

7.2. Endorsements. CONSULTANT shall provide proof of the following endorsements, listed for each policy for which endorsements are required, as outlined below:

7.2.1. General Liability and pollution liability (when pollution liability applies).

7.2.1.1. “Additionally Insured” - The City of Morgan Hill, its elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers are named as additional insureds on a form at least as broad as ISO Form CG 20 10 for ongoing operations.

7.2.1.2. “Waiver of Rights of Subrogation” - The insurer waives the right of subrogation against the City of Morgan Hill and CITY’S elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers; and

7.2.1.3. “Primary and Non-Contributing” - Insurance shall be endorsed to be primary and non-contributory and will not seek contribution from the City’s insurance or selfinsurance and shall be at least as broad as ISO Form CG 20 01.

7.2.2. Workers Compensation.

If the performance of CONSULTANT’S work or service under this Agreement involves access to or activity on any property or premises owned or occupied by the CITY, including, but not limited to, CONSULTANT’S presence during site visits and meetings, then insurer waives the right of subrogation against the City of Morgan Hill and the CITY’s elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers.

7.3. Qualification of Insurers. All insurance required pursuant to this Agreement must be issued by a company licensed and admitted, or otherwise legally authorized to carry out insurance business in the State of California, and each insurer must have a current A.M. Best's financial strength rating of “A” or better and a financial size rating of “VII” or better.

7.4. Certificates. CONSULTANT shall furnish CITY of Morgan Hill with copies of all certificates as outlined herein, whether new or modified, promptly upon receipt. In the event of a claim or legal action, CONSULTANT shall promptly furnish CITY of Morgan Hill with copies of all policies outlined herein. No policy subject to the CONSULTANT’s agreement with the CITY shall be canceled or materially changed except after thirty (30) days' notice by the insurer to CITY. A "material change" is a change that results in non-compliance with any insurance requirements in this section 7. Certificates, including renewal certificates, may be mailed DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

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electronically to [email protected] or delivered to the Certificate Holder address provided herein.

Certificate Holder address:

City of Morgan Hill
Attn: Risk Management
17575 Peak Avenue
Morgan Hill, CA 95037

8. Non-Liability of Officials and Employees of the CITY. No official or employee of CITY shall be personally liable for any default or liability under this Agreement.

9. Compliance with Law.

9.1. CONSULTANT and its officers, employees, agents, and subcontractors shall comply with all applicable laws, ordinances, administrative regulations, and permitting requirements in carrying out their obligations under this Agreement. CONSULTANT and its officers, employees, agents, and subcontractors covenant there shall be no discrimination based upon race, color, creed, religion, gender, marital status, age, sexual orientation, national origin, mental disability, physical disability, medical condition, or ancestry, in any activity pursuant to this Agreement.

9.2. Compliance with Wage and Hour Laws: Consultant, and any subcontractor it employs to complete work under this Agreement, shall comply with all applicable federal, state and local wage and hour laws. Applicable laws may include, but are not limited to, the Federal Fair Labor Standards Act and the California Labor Code.

Final Judgments, Decisions, and Orders: For purposes of this Section, a “final judgment, decision, or order” refers to one for which all appeals have been exhausted or the time to appeal has expired. Relevant investigatory government agencies include: the federal Department of Labor, the California Division of Labor Standards Enforcement, or any other governmental entity or division tasked with the investigation and enforcement of wage and hour laws.

Prior Judgments against CONSULTANT and/or its Subcontractors: BY SIGNING THIS

AGREEMENT, CONSULTANT AFFIRMS THAT IT HAS DISCLOSED ANY FINAL

JUDGMENTS, DECISIONS OR ORDERS FROM A COURT OR INVESTIGATORY GOVERNMENT AGENCY FINDING – IN THE FIVE (5) YEARS PRIOR TO EXECUTING THIS AGREEMENT – THAT CONSULTANT OR ITS SUBCONTRACTOR(S) HAS VIOLATED ANY APPLICABLE WAGE AND HOUR LAWS. CONSULTANT FURTHER AFFIRMS THAT IT OR ITS SUBCONTRACTOR(S) HAS SATISFIED AND COMPLIED WITH – OR HAS REACHED AGREEMENT WITH THE CITY REGARDING THE MANNER IN WHICH IT WILL SATISFY – ANY SUCH JUDGMENTS, DECISIONS OR ORDERS.

Judgments or Decisions During Term of Contract: If at any time during the term of this Agreement, a court or investigatory government agency issues a final judgment, decision or order finding that CONSULTANT or an subcontractor it employs to perform work under this Agreement has violated any applicable wage and hour law, or CONSULTANT learns of such a judgment, decision, or order that was not previously disclosed, CONSULTANT shall inform DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

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the City Attorney, no more than fifteen (15) days after the judgment, decision or order becomes final or of learning of the final judgment, decision or order. CONSULTANT and its subcontractors shall promptly satisfy and comply with any such judgment, decision, or order, and shall provide the City Attorney with documentary evidence of compliance with the final judgment, decision or order within five (5) days of satisfying the final judgment, decision or order. The City reserves the right to require CONSULTANT to enter into an agreement with the City regarding the manner in which any such final judgment, decision, or order will be satisfied.

City’s Right to Withhold Payment: Where CONSULTANT or any subcontractor it employs to perform work under this Agreement has been found in violation of any applicable wage and hour law by a final judgment, decision or order of a court or government agency, the City reserves the right to withhold payment to CONSULTANT until such judgment, decision or order has been satisfied in full.

Material Breach: Failure to comply with any part of this Section constitutes a material breach of this Agreement. Such breach may serve as a basis for immediate termination of this Agreement and/or any other remedies available under this Agreement and/or law.

Notice to City Related to Wage Theft Prevention: Notice provided to the City Attorney as required under this Section shall be addressed to: City Attorney, City of Morgan Hill, 17575 Peak Avenue, Morgan Hill, CA 95037. The Notice provisions of this Section are separate from any other notice provisions in this Agreement and, accordingly, only notice provided to the above address satisfies the notice requirements in this Section.

10. Independent Contractor. CONSULTANT is an independent contractor and not an agent or employee of CITY.

11. Confidentiality. All data, documents, or other information received by CONSULTANT from CITY or prepared in connection with CONSULTANT’S services under this Agreement are deemed confidential and shall not be disclosed to any third party by CONSULTANT without prior written consent by CITY.

12. Conflict of Interest and Reporting. CONSULTANT shall at all times avoid conflict of interest or appearance of conflict of interest in performance of this Agreement.

13. Notices. All notices shall be personally delivered or mailed, via first class mail to the below listed address. These addresses shall be used for delivery of service of process. Notices shall be effective five (5) days after date of mailing, or upon date of personal delivery.

Address of CONSULTANT is as follows:

Housekeys, Inc.
358 Digital Drive
Morgan Hill, CA 95037
Address of CITY is as follows:

DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

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Rebecca Garcia
City of Morgan Hill
17575 Peak Avenue
Morgan Hill, CA 95037
with a copy to:

City Clerk
City of Morgan Hill
17575 Peak Avenue
Morgan Hill, CA 95037

14. Licenses, Permits and Fees. CONSULTANT shall obtain a City of Morgan Hill Business License, all permits and licenses to the extent required by ordinances, codes and regulations of the federal, state and local government.

15. Consultant's Proposal. If applicable, this Agreement shall include CONSULTANT'S proposal or bid which is incorporated herein. In the event of any inconsistency between the terms of the proposal and this Agreement, this Agreement shall govern.

16. Maintenance of Records.

16.1. Maintenance. CONSULTANT shall prepare, maintain, and preserve all reports and records that may be required by federal, state, and CITY rules and ordinances related to services provided under this Agreement. CONSULTANT shall maintain records for a period of at least 3 years after receipt of final payment under this Agreement. If any litigation, claim, negotiation, audit exception, or other action relating to this Agreement is pending at the end of the 3-year period, then CONSULTANT shall retain said records until such action is resolved.

16.2. Access to and Audit of Records. The CITY shall have the right to examine, monitor and audit all records, documents, conditions, and activities of the CONSULTANT and its subcontractors related to services under this Agreement. Pursuant to Government Code Section 8546.7, if this Agreement involves the expenditure of public funds in excess of $10,000, the Parties to this Agreement may be subject, at the request of the CITY or as part of any audit of the CITY, to the examination and audit of the State Auditor pertaining to matters connected with the performance of this Agreement for a period of three years after final payment under the Agreement.

16.3. Ownership of Work Product. All documents or other information developed or received by CONSULTANT for work performed under this Agreement shall be the property of CITY.

CONSULTANT shall provide CITY with copies of these items upon demand or upon termination of this Agreement.

17. Familiarity with Work. By executing this Agreement, CONSULTANT represents that: (1) it has investigated the work to be performed; (2) it has investigated the site of the work and is aware of all conditions there; and (3) it understands the difficulties and restrictions of the work under this Agreement. Should CONSULTANT discover any conditions materially differing from those inherent in the work or as represented by CITY, it shall immediately inform CITY and shall not proceed, except at CONSULTANT'S risk, until written instructions are received from CITY.

18. Time of Essence. Time is of the essence in the performance of this Agreement.

19. No Assignment. Neither this Agreement nor any portion shall be assigned by CONSULTANT, without prior written consent of CITY. Any attempted assignment not first approved by CITY shall be void and, at CITY's option, shall terminate this Agreement effective as of the date of such attempted assignment.

DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

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20. Attorney Fees. In any legal action, dispute or arbitration arising out of or relating to this Agreement, the prevailing party shall be entitled to an award of its reasonable attorney fees, costs and expenses incurred.

21. Defense and Indemnification.

21.1. Defense and Indemnification. CONSULTANT shall, to the fullest extent permitted by law, indemnify, defend and hold harmless CITY, its elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers (“INDEMNITEES”) from and against any and all claims, liabilities, expenses, liens, or damages of any nature, including liability for bodily injury, property damage or personal injury, and including reasonable attorneys' fees and expenses, that arise out of, pertain to, or relate to the performance of this Agreement or the failure to comply with any obligations contained in this Agreement by CONSULTANT, and/or its agents, officers, employees, subcontractors, or independent contractors (“CLAIM”).

21.2. Exceptions. CONSULTANT is not required to indemnify INDEMNITEES against liability for bodily injury, property damage or personal injury, or any other loss, damage or expense arising from the sole negligence or willful misconduct of the CITY.

21.3. Not limited by insurance. The indemnity, defense and hold harmless provisions of this Agreement apply to all CLAIMs alleged against an INDEMNITEE, regardless of whether any insurance policies are applicable. Policy limits do not act as a limitation upon the amount of indemnification or defense to be provided by CONSULTANT.

21.4. Right to Offset. CITY shall have the right to offset against any compensation due CONSULTANT under this Agreement any amount due CITY from CONSULTANT as a result of CONSULTANT's failure to pay CITY promptly any indemnification arising under this Section (21) and any amount due CITY from CONSULTANT arising from CONSULTANT's failure either to (i) pay taxes on amounts received pursuant to this Agreement or (ii) comply with applicable workers' compensation laws.

21.5. Interpretation. This Section shall constitute an agreement or contract of indemnity, incorporating the interpretations under California Civil Code Section 2778. It is expressly understood and agreed that the obligation of the CONSULTANT to indemnify the INDEMNITEE shall be as broad and inclusive as permitted by the laws of the State of California and shall survive termination of this Agreement.

22. Entire Agreement; Modification; Conflicting Provisions. This Agreement constitutes the entire Agreement between the Parties and supersedes any previous agreements, oral or written. This Agreement may be modified, or provisions waived only by a subsequent mutual written agreement executed by CITY and CONSULTANT. If the provisions contained in the main body of this Agreement conflict with any provision contained in an exhibit to this Agreement, the provisions of the main body of this Agreement shall govern and control over any provision contained in an exhibit to this Agreement.

23. Governing Law and Venue. This Agreement shall be construed in accordance with the laws of the State of California. This Agreement was entered into and is to be performed in the County of Santa Clara.

Any action or dispute arising out of this Agreement shall only be brought in Santa Clara County.

24. Interpretation. This Agreement is a negotiated document and shall be deemed to have been drafted jointly by the Parties, and no rule of construction or interpretation shall apply against any particular Party based on a contention that the Agreement was drafted by one of the Parties including, but not limited to, DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

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California Civil Code § 1654, the provisions of which are hereby waived. This Agreement shall be construed and interpreted in a neutral manner.

25. Preservation of Agreement. If any term, provision, covenant, or condition of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, the rest of the Agreement shall remain in full force and effect and shall in no way be affected or invalidated.

26. Binding Agreement. Notwithstanding the provisions of Section 19 above, this Agreement shall bind any and all successors in interest, legal representatives and/or other permitted assignees or transferees of CONSULTANT in the same manner as if those successors in interest, legal representatives or other permitted assignees or transferees had entered into this Agreement originally.

27. □ Data Sharing. This Agreement requires access by CONSULTANT to CITY’s Geographic Information System (GIS) DATA for CONSULTANT to perform the work. CITY agrees to provide the GIS DATA to CONSULTANT solely for the purpose of performance of contracted work with the CITY upon the terms and conditions specified in Exhibit D, incorporated herein by this reference. [Signatures on Next Page]
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28. Authority to Execute. Those individuals who are signing this Agreement on behalf of entities represent and warrant that they are, respectively, duly authorized to sign on behalf of the entities and to bind the entities fully to each and all of the obligations set forth in this Agreement.

IN WITNESS THEREOF, these Parties have executed this Agreement on the day and year shown below.

AS SET FORTH IN CA. CORP. CODE § 313, TWO SIGNATURES ARE REQUIRED FOR CALIFORNIA CORPORATIONS:
(1) CHAIRPERSON OF THE BOARD, PRESIDENT, OR VICE PRESIDENT; AND (2) SECRETARY, ASSISTANT SECRETARY, CHIEF FINANCIAL OFFICER OR ASSISTANT TREASURER.

ATTEST: CITY OF MORGAN HILL
City Clerk/Deputy City Clerk City Manager
Michelle Bigelow Christina J. Turner
Print Name Print Name
Date: Date:

APPROVED AS TO FORM: Housekeys, Inc.

City Attorney By:

Donald A. Larkin
Print Name
Date:

Print Name and Title of Signer.

If Corporate: Chairman, President or
Vice President
Date:

By:

Date:

Print Name and Title of Signer.

If Corporate: Secretary, Assistant
Secretary, Chief Financial Officer or
Assistant Treasurer
U:\Legal Forms\Consultant Agreements\City Standard Consultant Agreement.Docx DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79 6/9/2022
Julius Nyanda
Katarina Marusic
6/9/2022

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EXHIBIT A

SCOPE OF SERVICES
The Scope of Work details the roles and responsibilities of the City and Consultant. The Schedule starts from the date the contract is signed by both parties.

A. Consultant will continue BMR (Below Market Rate) Program Ownership Program Administration, Begin and CalHome Administration, and Below Market Rate Rental Program Administration for the term of the contract.

B. Consultant will administer BMR ownership and rental program and assure BMR Deed Restrictions are recorded and followed by all parties as applicable for each property.

C. Consultant will host BMR program at 356 Digital Dr., Morgan Hill, CA 95037 D. Consultant will regularly update BMR guidelines and program materials on the City's website and HouseKeys website, in conjunction with direction from the City Council, City Manager, and Staff's direction to reflect policies and procedures approved by the City Council.

The guidelines will include the Consultant's administrative process for BMR Administration including, but not limited to:

1. Applications, program pamphlets, continuously updated program marketing materials in both English and Spanish, resale calculations, buyer selection process, sale and

2. Resale of units, refinancing requests, collection of City fees and other applicable fees, and default monitoring/resolution process. Consultant's objective will be to work alongside City Staff to incorporate "learnings" from the City's 40 + year old BMR Program into a go-forward plan focused on best practices, cost recovery, and sustainability of the BMR Program.

E. Consultant will continue to maintain the City BMR program website presence that will link to the City of Morgan Hill website.

F. Consultant and the City will develop mutually acceptable response times to BMR inquiries and processing times required to obtain City signatures.

G. Consultant shall maintain the City's existing databases of which the City will have full access to, and files for program administration, and establish a file retention and management system for the program that is always accessible by City Staff. All electronic records, databases, and correspondence will be considered work products that are property of the City of Morgan Hill. The consultant will update the City's records monthly and notify city of updates, to ensure a coordinated seamless record keeping process.

H. Consultant will provide the applicant with the following services:

1. Conducting income qualifications including review of assets, income, Verification of Employment (VOE) and all other necessary approvals to ensure qualification for the City BMR Program.

2. Make necessary revisions to the City's existing program materials and legal documents, subject to City approval

3. Underwriting loan applications in accordance with program requirements.

4. Preparing all loan documents, overseeing proper execution thereof, and conducting final approval reviews

5. Ensuring timely delivery of all necessary documents into escrow and preparing escrow demands.

6. Overall management and implementation of specific program policies.

7. Preparation of BMR program materials, revised as needed on an ongoing basis.

8. Calculating all pay off demands and issuing any disclosures and tax forms as required by State and/or Federal Law.

9. Calculating the resale value of each individual BMR unit, and annually submitting accurate property BMR values on behalf of the City to the County Tax Accessor via a detailed workbook of data. This information shall be accessible to the City and simultaneously submitted to the City in an electronic report with the transparent calculation used to generate the BMR value.

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10. Work with City Staff to ensure a seamless and coordinated development of documents as it relates to the BMR Program, including the Inclusionary Housing Affordable Agreement and any subsequent amendments to the Development.

I. Consultant shall act as a transaction coordinator for all real estate transactions and will follow the current City BMR Fee Schedule approved by City Council. Consultant will charge BMR re-sale transaction fee in line with applicable recorded Deed Restrictions per the Fee Schedule. Consultant will charge the developer transaction coordination fees in accordance with the Affordable Housing Agreement pertaining to the subject development project per the fee schedule.

J. Consultant will coordinate document transmittals between buyers, homeowners, developers, and City as needed. Consultant will be responsible for ensuring all documents submitted for City signatures are complete and accurate. Consultant will be responsible for making any necessary corrections to documents. Consultant will submit accurate documents to the city at which point a 2- week processing period will begin at the City level to review and obtain signatures.

K. Consultant will work with City staff to coordinate tracking of BMR units produced.

L. Consultant shall work alongside Staff to conduct monitoring and compliance of the terms and conditions of BMR recorded deed restrictions including the following:

1. Mailing monitoring letters to all the BMR units for self-certification.

2. Reviewing in conjunction with City Staff, City or County Assessor data as needed (e.g., water utility bills, property records)

3. Review City's preliminary monitoring list to identify follow up actions required.

4. Meet with City staff to develop guidelines for acceptable default remedies

5. Attempt to cure asset management issues with proactive measures as approved by City Council procedures, and/or the City Manager or his or her designee.

M. Consultant shall work alongside Staff to investigate and identify cure for potential BMR defaults including:

1. Conduct follow-up to those BMR owners who do not submit their compliance documentation

2. Reviewing information from calls from BMR neighbors and interested parties.

3. Conduct reasonable follow-up investigation to assess potential BMR defaults including unit site visits and provide a summary report to the city within 7 business days.

4. Schedule virtual and in person appointments with BMR owners as needed.

5. For confirmed defaults, provide owners with list of actions needed with a timeline to remedy the default and conduct follow-up to monitor compliance. Subsequently, provide the City with a letter documenting the efforts made thus far by the administrator to cure the situation, include dates and times, response, or lack thereof of the homeowner, and various ways in which the administrator tried to remedy the situation prior to escalation. This will be done on a case-by-case basis, coordinated with Staff, to ensure enforcement efforts are escalated as needed to preserve the affordability of the BMR home and assist families with guidance as needed.

6. Maintain a log of actions taken to remedy the defaults.

7. For those defaults in which the owners choose to not remedy the situation within a reasonable amount of time, Consultant will meet with City staff to determine the course of action to pursue.

8. Monthly, provide City with a list of any current BMR defaults and actions taken to date.

N. Consultant shall provide the City with a monthly list of "problem properties" that have been identified with a case study description of the issue, concern, efforts made thus far, recommendations and solutions, and a timeline of next steps and results. This report is ongoing.

O. Consultant will provide the city with monthly reports reflecting the following performance measures for BMR program administration. Additional measures may be developed in conjunction with City staff. Performance measures will be included in monthly BMR summary reports. * Qualified # of buyers and renters
*Total number of households in the HouseKeys Morgan Hill database for Ownership Program *Total number of households in the HouseKeys Morgan Hill database for Rental Program *Name and number of Developers that are being onboarded to the Program DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

13 Updated March 2022
* Ongoing development of New Buyer Pipeline (# households that have expressed interest and the number of applications that are processed) to assist developers with closing on time. * Record # of Affordable Housing Agreements
* Held # of Lotteries for potential new homeowners and rental tenants * Ongoing, BMR Website updates - www.HouseKeys.org to disseminate information and connect to the City of Morgan Hill Website
* Assisted # of Development Projects that needed onboarding to City process and sale of units. * Recorded # BMR Properties with Notice of Defaults (NOD) * Held # BMR Educational Orientations in English at City Hall and virtually with # Registrants * Held # BMR Educational Orientations in Spanish at City Hall and virtually with # Registrants * Held # BMR orientations in the city at offsite locations to target audiences (e.g. local businesses and schools)
* # of views of Houskeys website
* # of attendees of the Virtual Orientation and FAQ session * # of BMR Existing Homeowner Workshops held to provide current homeowners an opportunity to stay engaged and educated on the BMR Program
* # BMR Home Sale Transactions
* # refinance transactions completed
* # resale transactions completed
* # BMR units Rehabbed and sold
* # new construction sales completed
* # Escrow/Closings
* # of New Lenders Identified and qualified to facilitate Purchase Transactions and familiarize their legal teams with the Programs 45-year affordability restrictions * # of County Tax Assessors records of detailed description of each BMR home in the City to ensure accurate property tax assessments submitted to County.
* Monthly # of tickets opened on Housekeys website by current BMR Homeowners * Monthly list of address/names of homeowner tickets opened, the type of ticket, description of request, and date ticket was opened and closed or if it is still pending and why * To the extent possible, close the ticket in 14 business days. As per the City policy, customers will be called back within 24 hours to confirm the receipt of the ticket or phone call. To ensure excellent customer service, customers will be provided with a primary point of contact that will be responsible for completing the ticket and communication with the client. * # asset management cases cured
* General Asset Management Activity updates
* Program policy updates
* Total Revenue Collected in relation to the City of Morgan Hill BMR Program with backup documentation.

P. Consultant will partner with the City to create City legal templates for documents required for signature by the BMR participants. Consultant shall supply documents that are typically used in Santa Clara County for residential real estate transactions (e.g., purchase and sale, disclosure acknowledgements, addendums, etc.)
Q. Consultant will create and maintain a list of approved loan officers and lending operations eligible to provide mortgage lending for purchase and refinance transactions, on the website, as well as the transparent process/steps in which a lender can take to become an approved lender.

R. Consultant will review individual BMR restrictions for terms and requirements as needed including sweat equity and equity share units.Consultant will discuss its findings with City staff.

S. Consultant will prepare City staff reports on a time and materials basis.

T. Consultant enters into this contract with the City of Morgan Hill with the intention of continuing a Model City Project that incorporates Industry Best Practices, A BMR Database, and a Regional BMR Working Group. This Project will improve efficiencies and reduce program costs to the city.

DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

14 Updated March 2022
U. Consultant will construct a work plan for a Regional BMR Working Group to explore strategies to preserve affordable housing stock, seek legislative solutions and examine program cost and value.

V. Consultant will design a Regional BMR Database that first focuses on the Morgan Hill Portfolio with the intention of introducing an Affordable Housing Technology Platform to facilitate all aspects of development, buyer orientation, buyer-property matchup, portfolio management and compliance.

W. Consultant will promote and market BMR program to the local community by conducting both in person and virtual BMR Educational Orientations in both Spanish and English (at least once each) monthly at City Hall Council Chambers. Quarterly, consultant and city will look for opportunities for consultant to conduct BMR Educational Orientations in both Spanish and English at offsite community locations including local business and school sites. Consultant will develop and distribute and provide to city for distribution, continuously updated program and BMR unit marketing materials including flyers, social media content, and program information packets in both Spanish and English. Consultant will provide a representative to attend “general affordable housing educational events” including in person and virtual townhalls, farmers markets, city and school festivals, and other community events.

X. Consultant will provide annually in both Spanish and English, updated HCD/Santa Clara County/Morgan Hill “Rental Rates & Income Tables” within 3 business days of published rates.

RENTAL PROGRAM SCOPE OF WORK
Client / Agency Service Support
• Client Contact Updates
• Program Guidelines
• Consulting and Program Refinement
• Assist with Staff Reports
Applicant Pool Management and Applicant Selection
• Orientations
• Point-of-Contact for Applicants
• Application I.D. Issuance
• Lottery Management
Staff Assistance with New Construction Developments
• Developer Agreement Review
• Affordable Housing Agreement Review
• Property Manager Workflow for Lease Up Auditing
• Catalog Project Information
• Annual Unit and Rent Roll Review to Ensure Compliance • Compliance Audit of up to 10% of Active Tenant Files
Optional (Developers have Option to Utilize HouseKeys Services for Fee) • Application File Management
• Application File Processing and Stacking
• Application File Underwriting and Eligibility Certification • Applicant Escalations and Accommodations
DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

15 Updated March 2022

EXHIBIT B

SCHEDULE OF COMPENSATION RATES & COSTS
Department Cost
Executive $ 240,000.00
Single-Family Ownership Programs $ 990,000.00
Multi-Family Rental Programs $ 510,000.00
Housing Finance Programs $ 180,000.00
Program Support $ 400,000.00
Product, Data, Technology $ 700,000.00
Communications $ 93,000.00
Legal $ 200,000.00
Total Department Costs $ 3,313,000.00
Total Annual Budget $ 3,802,000.00
Income Sought from Fee Schedule and Other Sources $ 3,252,000.00 Payment from City of Morgan Hill $ 550,000.00
DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

16 Updated March 2022

HOUSEKEYS STANDARD FEE SCHEDULE
July 1, 2022, to June 30, 2024
1 Fees may be lowered pursuant to previously executed Agreements (e.g., developer agreement, resale restriction agreement, promissory note, etc.) with lower fee schedules or stated fee limitations.

These are collectively referred to as “Legacy Agreements.” E# Description Fee1 Fee Cap / Max Billed To
1 Program Administration Base Fee to be Determined at
Contract
Agency
2 Rental Unit Processing Fee
(New Construction/Existing
Vacancies)
Up to $1,500.00
per lease
transaction
Up to
$1,500 per
lease
transaction
Optional to the
Developer
3 Rental Annual Compliance
Recertification Process Fee
(100% of resident files)
Up to $150 per unit Up to $150 per
unit
Optional to the
Developer
4 Project-level Annual Review
(Audit Rent Rolls and projectspecific Documents including leases)
No Cost to
Developers
No Cost to
Developers
Included in City
Contract
5 Tenant-level Eligibility Annual
Review (10% of resident files)
No Cost to
Developers
No Cost to
Developers
Included in City
Contract
6 Loan Processing Transaction
Fee for new loans (e.g.,
BEGIN)
$1,250.00 per
transaction2
$1,250.00 per
transaction
Owner / Lender
7 Refinance & Document
Processing Fee
$500 per
transaction
$500 per
transaction
Homeowner
[Agreement]
8 New Ownership Sales
Transaction Fee
3% of Sales
Price
Maximum
$18,000.00
Developer
[Agreement]
9 Ownership Resale Transaction
Fee
6% of
New Sales Price
Maximum
$36,000.00
Homeowner /
Added to Sales
Price [Agreement]
10 Acquisition and Ownership
Resale,Rehab Transaction
Fee (e.g., Case Management,
Enforcement and Foreclosure
of at-risk projects)
5% of Resale
Restriction Price
plus 5% of
New Sales Price
Maximum
$60,000.00
Homeowner /
Added to Sales
Price [Agreement]
11 Billing Rate for Projects
Outside of Contract Scope
$250.00 / hour $250.00 / hour Up-Front
Scope /
Agency
12 Training Program for Real
Estate Professionals
(Education offered)
$35 per class $35.00 Real Estate
Agents & Loan
Officers
13 Annual Registration for Loan
Officers and Real Estate
Agents who participate/benefit
from Program Transactions
$350 per agent per
year
$350 Real Estate
Agents & Loan
Officers
DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

17 Updated March 2022

EXHIBIT C

SCHEDULE OF PERFORMANCE
Consultant will continue BMR (Below Market Rate) Program Ownership and Rental Program Administration and Begin and CalHome Administration, during the term of the contract.

DocuSign Envelope ID: 41281EE2-47B6-46D5-A9EB-AC171153CD79

5 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Mario Ramirez, Police Captain
APPROVED BY: City Manager
APPROVE AGREEMENT WITH SECURE SOLUTIONS INC. FOR

BACKGROUND INVESTIGATION SERVICES

RECOMMENDATION(S)
Approve agreement and authorize City Manager to execute and administer the agreement with Secure Solutions Inc. for an amount not to exceed $200,000 to conduct hiring background investigations of Police Department and Information Technology personnel.

Estimated Time:

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Enhancing Diversity and Inclusiveness
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Public Safety Master Plan
REPORT NARRATIVE:

The Morgan Hill Police Department currently has a Consultant Agreement with Secure Solutions Inc. to conduct hiring background investigations for police and information technology personnel. The current Consultant Agreement expires on June 30, 2022.

Staff recommends entering into a new agreement beginning July 1, 2022 to June 30, 2026.

Background:

On July 31, 2018, the Police Department entered into a Consultant Agreement with Secure Solutions Inc. Secure Solutions Inc. conducts thorough background investigations on each candidate according to guidelines established by Peace Officer Standards of Training (POST). Each individual investigation includes the following:

5  An in-depth interview with the candidate and review of the Personal History Statement and any supplemental questionnaires depending upon the desired position.
 An investigation that includes local law enforcement criminal history check, verification of citizenship, education, DMV history, financial history, military history, and other applicable legal documents.
 Civil court records include dissolution of marriages, social media checks, contact with neighbors, relatives, and references, contact with current and past employers and coworkers, review of available personnel files, academy files, and other relevant documents.
 Status of applications with other agencies where the candidate has sought employment within the last two years.
 Background investigations are conducted for all Police Department positions, including Police Officer, Animal Services Officer, Multi-Services Officer, Dispatcher, Records Specialist, and other administrative/support positions.  Background investigations are conducted for all Information Technology positions as they have unique access to data and information located within the Police Department's Records Management and Computer Aided Dispatch Systems (RMS and CAD).

Background investigations can cost a few hundred dollars to $2,500 depending on the location of the applicant and the length of the investigation. Multiple applicants are sent to backgrounds for each position since the hiring standards are substantial. Prior to the background investigations, most applicants will have already passed the application screening, oral boards, polygraph, and pre-psychological assessment in order to keep costs at a minimum.

Staff recommends entering into a new agreement beginning July 1, 2022 through June 30, 2026 for the current and any future public safety vacancies to include but not limited to Police Officer(s), Record Services positions, Dispatcher(s), and other critical positions as needed for the City of Morgan Hill. The Agreement sets forth rates for Secure Solutions and ensures in-depth backgrounds will be conducted.

COMMUNITY ENGAGEMENT:

This staff report serves to inform the community of the City’s desire to enter into a fouryear Agreement with Secure Solutions Inc. for in-depth background check services beginning on July 1, 2022 to June 30, 2026.

ALTERNATIVE ACTIONS:

Council could direct staff to seek and contract with alternative firm(s) to provide background investigation services to fill the current vacancies within the Police Department.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

5 In June 2020, Council approved a second two-year contract with Secure Solutions in the amount of $100,000.

FISCAL AND RESOURCE IMPACT:

Sufficient funds for background investigations have been included in the Recommended Budget for FY2022-2023 and 2023-2024. Funds for FY2024-2025 and FY2025-2026 will be included in the next two-year budget development process. During the term of the agreement, background investigations will be conducted on an as-needed basis, depending on staffing needs.

CEQA (California Environmental Quality Act):

Not a Project
This Agreement entails organizational or administrative activities of governments and will not result in direct or indirect physical changes in the environment.

6 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Pam van der Leeden, GIS Manager
APPROVED BY: City Manager

APPROVE A THREE-YEAR SMALL GOVERNMENT ENTERPRISE

AGREEMENT WITH ENVIRONMENTAL SYSTEMS RESEARCH

INSTITUTE, INC (ESRI) FOR GIS SOFTWARE LICENSING FOR A
TOTAL AMOUNT OF $115,500

RECOMMENDATION(S)
Approve and authorize the City Manager to execute a three-year Small Government Enterprise Agreement with Environmental Systems Research Institute, Inc. (Esri) for GIS software licensing for a total amount of $115,500.

Estimated Time: NA

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Protecting the Environment and Preserving Open Space and Agricultural Land Supporting our Youth, Seniors, and Entire Community
Fostering a Positive Organizational Culture
Advancing Regional Initiatives
2022-2023 Strategic Priorities
Community Outreach, Engagement, and Messaging
Guiding Documents
GIS Strategic Plan
REPORT NARRATIVE:

The purpose of this agreement is to purchase software licensing from Esri, the City’s current GIS software vendor.

How the licensing is used:

The GIS Division provides geographic mapping and spatial data analysis to departments and divisions Citywide. Staff are continuing to build out the GIS program by focusing on increasing access to GIS data and applications through business system integration, data development and staff training, all of which are made possible through

6 our current software licensing agreement.

Some examples of how City teammates are using Esri software to access GIS:
• Through the City’s internal web map, CityMaps
• Through integration with City business applications: GIS has been integrated with Cityworks, Sedaru, and POSM. Integration with Community Development (formerly TRAKiT) is scheduled for FY 2022-23
• Through desktop and web software
• Through data in enterprise databases
• Through redundant servers. The GIS system includes redundant servers, so that if one fails or needs to be taken down for maintenance, the second server will continue to provide access to GIS software and data
• And planned for FY 2022-23, through both internal and external GeoHub application which will include a public access data download portal Proposed Agreement Specifics:

The vendor is Environmental Systems Research Institute, Inc. (Esri), maker of the GIS software (ArcGIS) currently in use at the City. ArcGIS software is the industry standard in the U.S. and Esri’s position in the GIS software market can be compared to Microsoft’s dominance in office software applications. Using the same software as other cities, counties, and businesses is efficient and allows the City to easily use, share, and obtain data from outside sources and also facilitates collaboration.

Because there is no reasonable alternative to this software, City staff requested a quote from Esri for a new small government agreement. The terms are similar to our existing three-year agreement with Esri which expires in July of 2022. The agreement is for cities of similar population size to Morgan Hill and is called a “Small Government Enterprise Agreement” that allows the City to purchase licensing from Esri for a discounted, flat-rate yearly fee. It covers unlimited licensing of core Esri products.

The agreement will be effective July 17th, 2022 through July 16th, 2025. The total cost of the agreement is $115,500 which is billed yearly at $38,500 per year. This is a 9% cost increase over our current agreement.

If the City were to purchase the licensing from Esri on an ad-hoc basis rather than through this agreement, the cost would be significantly greater. The agreement includes multiple products including the ArcGIS Enterprise server license. For example, the two server licenses alone would cost $80,000 for the first year and $20,000 for subsequent years.

This is a standard Esri agreement that cannot be modified. The proposed agreement contains three components which are included as attachments:

1. Quotation- Esri uses this as the primary agreement

2. Small Enterprise Agreement- sets out the terms and contains the signature page

3. Master Agreement - referenced in the Small Enterprise Agreement, which sets out rights and restrictions of the desktop and web software Staff recommends Council approve this three-year agreement with Esri to continue City

6 access to necessary GIS software.

COMMUNITY ENGAGEMENT:

Inform.

This staff report serves to inform the community of the proposed service agreement with ESRI.

ALTERNATIVE ACTIONS:

The City Council could choose not to move forward with the proposed agreement and direct staff to purchase its GIS software licenses from Esri on an ad-hoc basis, which would be significantly more expensive and provide fewer products.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On June 26, 2019, the City Council approved the current software licensing agreement with Esri.

FISCAL AND RESOURCE IMPACT:

The amount of $77,000 ($38,500 per year) for the initial two years is included in the Recommended Fiscal Years 2022-23 and 2023-24 budget, therefore no additional appropriations are required at this time. Funding for the third year will be included in the GIS division’s proposed budget for the next biennial budget.

CEQA (California Environmental Quality Act):

Not a Project:

Since the resulting activity is software licensing that will not result in a change to the physical environment, this action is not a project under the California Environmental Quality Act.

Quotation # Q-462633
Date: May 16, 2022
Environmental Systems Research Institute, Inc.
380 New York St
Redlands, CA 92373-8100
Phone: (909) 793-2853 Fax: (909) 307-3049
DUNS Number: 06-313-4175 CAGE Code: 0AMS3
Customer # 391960 Contract #
City of Morgan Hill
GIS Dept
17575 Peak Ave
Morgan Hill, CA 95037-4128
To expedite your order, please attach a copy of ATTENTION: Pam van der Leeden this quotation to your purchase order. PHONE: (669) 253-4330 Quote is valid from: 1/31/2022 To: 7/30/2022 EMAIL: [email protected] Material Qty Term Unit Price Total
168178 1 Year 1 $38,500.00 $38,500.00
Populations of 25,001 to 50,000 Small Government Term Enterprise License Agreement 168178 1 Year 2 $38,500.00 $38,500.00
Populations of 25,001 to 50,000 Small Government Term Enterprise License Agreement 168178 1 Year 3 $38,500.00 $38,500.00
Populations of 25,001 to 50,000 Small Government Term Enterprise License Agreement Subtotal: $115,500.00
Sales Tax: $0.00
Estimated Shipping and Handling (2 Day Delivery): $0.00 Contract Price Adjust: $0.00
Total: $115,500.00
Esri may charge a fee to cover expenses related to any customer requirement to use a proprietary vendor management, procurement, or invoice program.

For questions contact:

Jesse Gonzalez
Email:
[email protected]
Phone:
(909) 793-2853 x1106
The items on this quotation are subject to and governed by the terms of this quotation, the most current product specific scope of use document found at https://assets.esri.com/content/dam/esrisites/media/legal/product-specific-terms-of-use/e300.pdf, and your applicable signed agreement with Esri. If no such agreement covers any item quoted, then Esri’s standard terms and conditions found at https://go.esri.com/MAPS apply to your purchase of that item. If any item is quoted with a multi-year payment schedule, then unless otherwise stated in this quotation, Customer is required to make all payments without right of cancellation. Third-party data sets included in a quotation as separately licensed items will only be provided and invoiced if Esri is able to provide such data and will be subject to the applicable third-party's terms and conditions. If Esri is unable to provide any such data set, Customer will not be responsible for any further payments for the data set. US Federal government entities and US government prime contractors authorized under FAR 51.1 may purchase under the terms of Esri’s GSA Federal Supply Schedule. Supplemental terms and conditions found at https://www.esri.com/en-us/legal/terms/state-supplemental apply to some US state and local government purchases. All terms of this quotation will be incorporated into and become part of any additional agreement regarding Esri’s offerings. Acceptance of this quotation is limited to the terms of this quotation. Esri objects to and expressly rejects any different or additional terms contained in any purchase order, offer, or confirmation sent to or to be sent by buyer. Unless prohibited by law, the quotation information is confidential and may not be copied or released other than for the express purpose of system selection and purchase/license. The information may not be given to outside parties or used for any other purpose without consent from Esri. Delivery is FOB Origin for customers located in the USA.

GONZALEZJ This offer is limited to the terms and conditions incorporated and attached herein.

Quotation # Q-462633
Date: May 16, 2022
Environmental Systems Research Institute, Inc.
380 New York St
Redlands, CA 92373-8100
Phone: (909) 793-2853 Fax: (909) 307-3049
DUNS Number: 06-313-4175 CAGE Code: 0AMS3
Customer # 391960 Contract #
City of Morgan Hill
GIS Dept
17575 Peak Ave
Morgan Hill, CA 95037-4128
To expedite your order, please attach a copy of ATTENTION: Pam van der Leeden this quotation to your purchase order. PHONE: (669) 253-4330 Quote is valid from: 1/31/2022 To: 7/30/2022 EMAIL: [email protected] _________________________________________________________________________________________________________________________________ If you have made ANY alterations to the line items included in this quote and have chosen to sign the quote to indicate your acceptance, you must fax Esri the signed quote in its entirety in order for the quote to be accepted. You will be contacted by your Customer Service Representative if additional information is required to complete your request.

If your organization is a US Federal, state, or local government agency; an educational facility; or a company that will not pay an invoice without having issued a formal purchase order, a signed quotation will not be accepted unless it is accompanied by your purchase order.

In order to expedite processing, please reference the quotation number and any/all applicable Esri contract number(s) (e.g. MPA, ELA, SmartBuy, GSA, BPA) on your ordering document.

BY SIGNING BELOW, YOU CONFIRM THAT YOU ARE AUTHORIZED TO OBLIGATE FUNDS FOR YOUR ORGANIZATION, AND YOU ARE AUTHORIZING ESRI TO ISSUE AN INVOICE FOR THE ITEMS INCLUDED IN THE ABOVE QUOTE IN THE AMOUNT OF $___________, PLUS SALES TAXES IF APPLICABLE. DO NOT USE THIS FORM IF YOUR ORGANIZATION WILL NOT HONOR AND PAY ESRI'S INVOICE WITHOUT ADDITIONAL AUTHORIZING PAPERWORK.

Please check one of the following:
___ I agree to pay any applicable sales tax.
___ I am tax exempt, please contact me if exempt information is not currently on file with Esri. ___________________________________________ ________________________ Signature of Authorized Representative Date
___________________________________________
Name (Please Print)
___________________________________________
Title
_________________________________________________________________________________________________________________________________ The quotation information is proprietary and may not be copied or released other than for the express purpose of system selection and purchase/license. This information may not be given to outside parties or used for any other purpose without consent from Environmental Systems Research Institute, Inc. (Esri).

Any estimated sales and/or use tax reflected on this quote has been calculated as of the date of this quotation and is merely provided as a convenience for your organization's budgetary purposes. Esri reserves the right to adjust and collect sales and/or use tax at the actual date of invoicing. If your organization is tax exempt or pays state tax directly, then prior to invoicing, your organization must provide Esri with a copy of a current tax exemption certificate issued by your state's taxing authority for the given jurisdiction.

Esri may charge a fee to cover expenses related to any customer requirement to use a proprietary vendor management, procurement, or invoice program.

For questions contact:

Jesse Gonzalez
Email:
[email protected]
Phone:
(909) 793-2853 x1106
The items on this quotation are subject to and governed by the terms of this quotation, the most current product specific scope of use document found at https://assets.esri.com/content/dam/esrisites/media/legal/product-specific-terms-of-use/e300.pdf, and your applicable signed agreement with Esri. If no such agreement covers any item quoted, then Esri’s standard terms and conditions found at https://go.esri.com/MAPS apply to your purchase of that item. If any item is quoted with a multi-year payment schedule, then unless otherwise stated in this quotation, Customer is required to make all payments without right of cancellation. Third-party data sets included in a quotation as separately licensed items will only be provided and invoiced if Esri is able to provide such data and will be subject to the applicable third-party's terms and conditions. If Esri is unable to provide any such data set, Customer will not be responsible for any further payments for the data set. US Federal government entities and US government prime contractors authorized under FAR 51.1 may purchase under the terms of Esri’s GSA Federal Supply Schedule. Supplemental terms and conditions found at https://www.esri.com/en-us/legal/terms/state-supplemental apply to some US state and local government purchases. All terms of this quotation will be incorporated into and become part of any additional agreement regarding Esri’s offerings. Acceptance of this quotation is limited to the terms of this quotation. Esri objects to and expressly rejects any different or additional terms contained in any purchase order, offer, or confirmation sent to or to be sent by buyer. Unless prohibited by law, the quotation information is confidential and may not be copied or released other than for the express purpose of system selection and purchase/license. The information may not be given to outside parties or used for any other purpose without consent from Esri. Delivery is FOB Origin for customers located in the USA.

GONZALEZJ This offer is limited to the terms and conditions incorporated and attached herein.

Esri Use Only:

Cust. Name
Cust. #
PO #
Esri Agreement #

SMALL ENTERPRISE AGREEMENT

COUNTY AND MUNICIPALITY GOVERNMENT
(E214-2)
This Agreement is by and between the organization identified in the Quotation ("Customer") and Environmental Systems Research Institute, Inc. ("Esri").

This Agreement sets forth the terms for Customer's use of Products and incorporates by reference (i) the Quotation and (ii) the Master Agreement. Should there be any conflict between the terms and conditions of the documents that comprise this Agreement, the order of precedence for the documents shall be as follows: (i) the Quotation, (ii) this Agreement, and (iii) the Master Agreement. This Agreement shall be governed by and construed in accordance with the laws of the state in which Customer is located without reference to conflict of laws principles, and the United States of America federal law shall govern in matters of intellectual property. The modifications and additional rights granted in this Agreement apply only to the Products listed in Table A.

Table A
List of Products
Uncapped Quantities
Desktop Software and Extensions (Single Use)
ArcGIS Desktop Advanced
ArcGIS Desktop Standard
ArcGIS Desktop Basic
ArcGIS Desktop Extensions: ArcGIS 3D Analyst,
ArcGIS Spatial Analyst, ArcGIS Geostatistical Analyst,
ArcGIS Publisher, ArcGIS Network Analyst, ArcGIS
Schematics, ArcGIS Workflow Manager, ArcGIS Data
Reviewer
Enterprise Software and Extensions
ArcGIS Enterprise and Workgroup
(Advanced and Standard)
ArcGIS Monitor
ArcGIS Enterprise Extensions: ArcGIS 3D Analyst,
ArcGIS Spatial Analyst, ArcGIS Geostatistical Analyst,
ArcGIS Network Analyst, ArcGIS Schematics, ArcGIS
Workflow Manager
Enterprise Additional Capability Servers
ArcGIS Image Server
Developer Tools
ArcGIS Engine
ArcGIS Engine Extensions: ArcGIS 3D Analyst, ArcGIS
Spatial Analyst, ArcGIS Engine Geodatabase Update,
ArcGIS Network Analyst, ArcGIS Schematics
ArcGIS Runtime (Standard)
ArcGIS Runtime Analysis Extension
Limited Quantities
One (1) Professional subscription to ArcGIS Developer
Two (2) ArcGIS CityEngine Single Use Licenses
100 ArcGIS Online Viewers
100 ArcGIS Online Creators
17,500 ArcGIS Online Service Credits
100 ArcGIS Enterprise Creators
3 ArcGIS Insights in ArcGIS Enterprise
3 ArcGIS Insights in ArcGIS Online
10 ArcGIS Tracker for ArcGIS Enterprise
10 ArcGIS Tracker for ArcGIS Online
3 ArcGIS Parcel Fabric User Type Extensions (Enterprise) 3 ArcGIS Utility Network User Type Extensions (Enterprise) 3 ArcGIS Trace Network User Type Extensions (Enterprise)

OTHER BENEFITS
Number of Esri User Conference registrations provided annually 3 Number of Tier 1 Help Desk individuals authorized to call Esri 3 Maximum number of sets of backup media, if requested* 2 Five percent (5%) discount on all individual commercially available instructor-led training classes at Esri facilities purchased outside this Agreement
*Additional sets of backup media may be purchased for a fee

Customer may accept this Agreement by signing and returning the whole Agreement with (i) the Quotation attached, (ii) a purchase order, or (iii) another document that matches the Quotation and references this Agreement ("Ordering Document"). ADDITIONAL OR CONFLICTING TERMS IN CUSTOMER'S PURCHASE

ORDER OR OTHER DOCUMENT WILL NOT APPLY, AND THE TERMS OF THIS AGREEMENT WILL GOVERN. This Agreement is effective as of the date of Esri's receipt of an Ordering Document, unless otherwise agreed to by the parties ("Effective Date").

Term of Agreement: Three (3) years
This Agreement supersedes any previous agreements, proposals, presentations, understandings, and arrangements between the parties relating to the licensing of the Products. Except as provided in Article 4— Product Updates, no modifications can be made to this Agreement.

Accepted and Agreed:
(Customer)
By:

Authorized Signature
Printed Name:

Title:

Date:

CUSTOMER CONTACT INFORMATION
Contact: Telephone:

Address: Fax:

City, State, Postal Code: E-mail:

Country:

Quotation Number (if applicable):

1.0—ADDITIONAL DEFINITIONS
In addition to the definitions provided in the Master
Agreement, the following definitions apply to this
Agreement:
"Case" means a failure of the Software or Online
Services to operate according to the Documentation
where such failure substantially impacts operational
or functional performance.
"Deploy", "Deployed" and "Deployment" mean to
redistribute and install the Products and related
Authorization Codes within Customer's
organization(s).
"Fee" means the fee set forth in the Quotation.
"Maintenance" means Tier 2 Support, Product
updates, and Product patches provided to Customer
during the Term of Agreement.
"Master Agreement" means the applicable master
agreement for Esri Products incorporated by this
reference that is (i) found at https://www.esri.com/enus/legal/terms/full-master-agreement and available in the installation process requiring acceptance by
electronic acknowledgment or (ii) a signed Esri
master agreement or license agreement that
supersedes such electronically acknowledged
master agreement.
"Product(s)" means the products identified in
Table A—List of Products and any updates to the list
Esri provides in writing.
"Quotation" means the offer letter and quotation
provided separately to Customer.
"Technical Support" means the technical
assistance for attempting resolution of a reported
Case through error correction, patches, hot fixes,
workarounds, replacement deliveries, or any other
type of Product corrections or modifications.
"Tier 1 Help Desk" means Customer's point of
contact(s) to provide all Tier 1 Support within
Customer's organization(s).
"Tier 1 Support" means the Technical Support
provided by the Tier 1 Help Desk.
"Tier 2 Support" means the Esri Technical Support
provided to the Tier 1 Help Desk when a Case
cannot be resolved through Tier 1 Support.

2.0—ADDITIONAL GRANT OF LICENSE

2.1 Grant of License. Subject to the terms and
conditions of this Agreement, Esri grants to
Customer a personal, nonexclusive,
nontransferable license solely to use, copy, and
Deploy quantities of the Products listed in
Table A—List of Products for the Term of
Agreement (i) for the applicable Fee and (ii) in
accordance with the Master Agreement.

2.2 Consultant Access. Esri grants Customer the
right to permit Customer's consultants or
contractors to use the Products exclusively for
Customer's benefit. Customer will be solely
responsible for compliance by consultants and
contractors with this Agreement and will ensure
that the consultant or contractor discontinues
use of Products upon completion of work for
Customer. Access to or use of Products by
consultants or contractors not exclusively for
Customer's benefit is prohibited. Customer may
not permit its consultants or contractors to install
Software or Data on consultant, contractor, or
third-party computers or remove Software or
Data from Customer locations, except for the
purpose of hosting the Software or Data on
Contractor servers for the benefit of Customer.

3.0—TERM, TERMINATION, AND EXPIRATION

3.1 Term. This Agreement and all licenses
hereunder will commence on the Effective Date
and continue for the duration identified in the
Term of Agreement, unless this Agreement is
terminated earlier as provided herein. Customer
is only authorized to use Products during the
Term of Agreement. For an Agreement with a
limited term, Esri does not grant Customer an
indefinite or a perpetual license to Products.

3.2 No Use upon Agreement Expiration or
Termination. All Product licenses, all
Maintenance, and Esri User Conference
registrations terminate upon expiration or
termination of this Agreement.

3.3 Termination for a Material Breach. Either party
may terminate this Agreement for a material
breach by the other party. The breaching party
will have thirty (30) days from the date of written
notice to cure any material breach.

3.4 Termination for Lack of Funds. For an
Agreement with government or governmentPage 101 of 364

owned entities, either party may terminate this
Agreement before any subsequent year if
Customer is unable to secure funding through
the legislative or governing body's approval
process.

3.5 Follow-on Term. If the parties enter into
another agreement substantially similar to this
Agreement for an additional term, the effective
date of the follow-on agreement will be the day
after the expiration date of this Agreement.

4.0—PRODUCT UPDATES

4.1 Future Updates. Esri reserves the right to
update the list of Products in Table A—List of
Products by providing written notice to
Customer. Customer may continue to use all
Products that have been Deployed, but support
and upgrades for deleted items may not be
available. As new Products are incorporated into
the standard program, they will be offered to
Customer via written notice for incorporation into
the Products schedule at no additional charge.

Customer's use of new or updated Products
requires Customer to adhere to applicable
additional or revised terms and conditions in the
Master Agreement.

4.2 Product Life Cycle. During the Term of
Agreement, some Products may be retired or
may no longer be available to Deploy in the
identified quantities. Maintenance will be subject
to the individual Product Life Cycle Support
Status and Product Life Cycle Support Policy,
which can be found at
https://support.esri.com/en/otherresources/product-life-cycle. Updates for Products in the mature and retired phases may
not be available. Customer may continue to use
Products already Deployed, but Customer will
not be able to Deploy retired Products.

5.0—MAINTENANCE
The Fee includes standard maintenance benefits
during the Term of Agreement as specified in the
most current applicable Esri Maintenance and
Support Program document (found at
https://www.esri.com/enus/legal/terms/maintenance). At Esri's sole discretion, Esri may make patches, hot fixes, or
updates available for download. No Software other
than the defined Products will receive Maintenance.

Customer may acquire maintenance for other
Software outside this Agreement.
a. Tier 1 Support

1. Customer will provide Tier 1 Support
through the Tier 1 Help Desk to all
Customer's authorized users.

2. The Tier 1 Help Desk will be fully trained in
the Products.

3. At a minimum, Tier 1 Support will include
those activities that assist the user in
resolving how-to and operational questions
as well as questions on installation and
troubleshooting procedures.

4. The Tier 1 Help Desk will be the initial point
of contact for all questions and reporting of a
Case. The Tier 1 Help Desk will obtain a full
description of each reported Case and the
system configuration from the user. This
may include obtaining any customizations,
code samples, or data involved in the Case.

5. If the Tier 1 Help Desk cannot resolve the
Case, an authorized Tier 1 Help Desk
individual may contact Tier 2 Support. The
Tier 1 Help Desk will provide support in such
a way as to minimize repeat calls and make
solutions to problems available to
Customer’s organization.

6. Tier 1 Help Desk individuals are the only
individuals authorized to contact Tier 2
Support. Customer may change the Tier 1
Help Desk individuals by written notice to
Esri.
b. Tier 2 Support

1. Tier 2 Support will log the calls received
from Tier 1 Help Desk.

2. Tier 2 Support will review all information
collected by and received from the Tier 1
Help Desk including preliminary documented
troubleshooting provided by the Tier 1 Help
Desk when Tier 2 Support is required.

3. Tier 2 Support may request that Tier 1 Help
Desk individuals provide verification of
information, additional information, or
answers to additional questions to

supplement any preliminary information
gathering or troubleshooting performed by
Tier 1 Help Desk.

4. Tier 2 Support will attempt to resolve the
Case submitted by Tier 1 Help Desk.

5. When the Case is resolved, Tier 2 Support
will communicate the information to Tier 1
Help Desk, and Tier 1 Help Desk will
disseminate the resolution to the user(s).

6.0—ENDORSEMENT AND PUBLICITY
This Agreement will not be construed or interpreted
as an exclusive dealings agreement or Customer's
endorsement of Products. Either party may publicize
the existence of this Agreement.

7.0—ADMINISTRATIVE REQUIREMENTS

7.1 OEM Licenses. Under Esri's OEM or Solution
OEM programs, OEM partners are authorized to
embed or bundle portions of Esri products and
services with their application or service. OEM
partners' business model, licensing terms and
conditions, and pricing are independent of this
Agreement. Customer will not seek any discount
from the OEM partner or Esri based on the
availability of Products under this Agreement.

Customer will not decouple Esri products or
services from the OEM partners' application or
service.

7.2 Annual Report of Deployments. At each
anniversary date and ninety (90) calendar days
prior to the expiration of this Agreement,
Customer will provide Esri with a written report
detailing all Deployments. Upon request,
Customer will provide records sufficient to verify
the accuracy of the annual report.

8.0—ORDERING, ADMINISTRATIVE

PROCEDURES, DELIVERY, AND

DEPLOYMENT

8.1 Orders, Delivery, and Deployment
a. Upon the Effective Date, Esri will invoice
Customer and provide Authorization Codes to
activate the nondestructive copy protection
program that enables Customer to download,
operate, or allow access to the Products. If this
is a multi-year Agreement, Esri may invoice the
Fee up to thirty (30) calendar days before the
annual anniversary date for each year.
b. Undisputed invoices will be due and payable
within thirty (30) calendar days from the date of
invoice. Esri reserves the right to suspend
Customer's access to and use of Products if
Customer fails to pay any undisputed amount
owed on or before its due date. Esri may charge
Customer interest at a monthly rate equal to the
lesser of one percent (1.0%) per month or the
maximum rate permitted by applicable law on
any overdue fees plus all expenses of collection
for any overdue balance that remains unpaid
ten (10) days after Esri has notified Customer of
the past-due balance.
c. Esri's federal ID number is 95-2775-732.
d. If requested, Esri will ship backup media to the
ship-to address identified on the Ordering
Document, FOB Destination, with shipping
charges prepaid. Customer acknowledges that
should sales or use taxes become due as a
result of any shipments of tangible media, Esri
has a right to invoice and Customer will pay any
such sales or use tax associated with the receipt
of tangible media.

8.2 Order Requirements. Esri does not require
Customer to issue a purchase order. Customer
may submit a purchase order in accordance with
its own process requirements, provided that if
Customer issues a purchase order, Customer
will submit its initial purchase order on the
Effective Date. If this is a multi-year Agreement,
Customer will submit subsequent purchase
orders to Esri at least thirty (30) calendar days
before the annual anniversary date for each
year.
a. All orders pertaining to this Agreement will be
processed through Customer's centralized point
of contact.
b. The following information will be included in
each Ordering Document:
(1) Customer name; Esri customer number, if
known; and bill-to and ship-to addresses
(2) Order number
(3) Applicable annual payment due

9.0—MERGERS, ACQUISITIONS, OR

DIVESTITURES
If Customer is a commercial entity, Customer will
notify Esri in writing in the event of (i) a
consolidation, merger, or reorganization of Customer
with or into another corporation or entity;
(ii) Customer's acquisition of another entity; or (iii) a transfer or sale of all or part of Customer's
organization (subsections i, ii, and iii, collectively
referred to as "Ownership Change"). There will be
no decrease in Fee as a result of any Ownership
Change.

9.1 If an Ownership Change increases the
cumulative program count beyond the maximum
level for this Agreement, Esri reserves the right
to increase the Fee or terminate this Agreement
and the parties will negotiate a new agreement.

9.2 If an Ownership Change results in transfer or
sale of a portion of Customer's organization, that
portion of Customer's organization will transfer
the Products to Customer or uninstall, remove,
and destroy all copies of the Products.

9.3 This Agreement may not be assigned to a
successor entity as a result of an Ownership
Change unless approved by Esri in writing in
advance. If the assignment to the new entity is
not approved, Customer will require any
successor entity to uninstall, remove, and
destroy the Products. This Agreement will
terminate upon such Ownership Change.

Esri Use Only:

Cust. Name
Cust. #
PO #
Esri Agreement #

SMALL ENTERPRISE AGREEMENT

COUNTY AND MUNICIPALITY GOVERNMENT
(E214-2)
This Agreement is by and between the organization identified in the Quotation ("Customer") and Environmental Systems Research Institute, Inc. ("Esri").

This Agreement sets forth the terms for Customer's use of Products and incorporates by reference (i) the Quotation and (ii) the Master Agreement. Should there be any conflict between the terms and conditions of the documents that comprise this Agreement, the order of precedence for the documents shall be as follows: (i) the Quotation, (ii) this Agreement, and (iii) the Master Agreement. This Agreement shall be governed by and construed in accordance with the laws of the state in which Customer is located without reference to conflict of laws principles, and the United States of America federal law shall govern in matters of intellectual property. The modifications and additional rights granted in this Agreement apply only to the Products listed in Table A.

Table A
List of Products
Uncapped Quantities
Desktop Software and Extensions (Single Use)
ArcGIS Desktop Advanced
ArcGIS Desktop Standard
ArcGIS Desktop Basic
ArcGIS Desktop Extensions: ArcGIS 3D Analyst,
ArcGIS Spatial Analyst, ArcGIS Geostatistical Analyst,
ArcGIS Publisher, ArcGIS Network Analyst, ArcGIS
Schematics, ArcGIS Workflow Manager, ArcGIS Data
Reviewer
Enterprise Software and Extensions
ArcGIS Enterprise and Workgroup
(Advanced and Standard)
ArcGIS Monitor
ArcGIS Enterprise Extensions: ArcGIS 3D Analyst,
ArcGIS Spatial Analyst, ArcGIS Geostatistical Analyst,
ArcGIS Network Analyst, ArcGIS Schematics, ArcGIS
Workflow Manager
Enterprise Additional Capability Servers
ArcGIS Image Server
Developer Tools
ArcGIS Engine
ArcGIS Engine Extensions: ArcGIS 3D Analyst, ArcGIS
Spatial Analyst, ArcGIS Engine Geodatabase Update,
ArcGIS Network Analyst, ArcGIS Schematics
ArcGIS Runtime (Standard)
ArcGIS Runtime Analysis Extension
Limited Quantities
One (1) Professional subscription to ArcGIS Developer
Two (2) ArcGIS CityEngine Single Use Licenses
100 ArcGIS Online Viewers
100 ArcGIS Online Creators
17,500 ArcGIS Online Service Credits
100 ArcGIS Enterprise Creators
3 ArcGIS Insights in ArcGIS Enterprise
3 ArcGIS Insights in ArcGIS Online
10 ArcGIS Tracker for ArcGIS Enterprise
10 ArcGIS Tracker for ArcGIS Online
3 ArcGIS Parcel Fabric User Type Extensions (Enterprise) 3 ArcGIS Utility Network User Type Extensions (Enterprise) 3 ArcGIS Trace Network User Type Extensions (Enterprise)

OTHER BENEFITS
Number of Esri User Conference registrations provided annually 3 Number of Tier 1 Help Desk individuals authorized to call Esri 3 Maximum number of sets of backup media, if requested* 2 Five percent (5%) discount on all individual commercially available instructor-led training classes at Esri facilities purchased outside this Agreement
*Additional sets of backup media may be purchased for a fee

Customer may accept this Agreement by signing and returning the whole Agreement with (i) the Quotation attached, (ii) a purchase order, or (iii) another document that matches the Quotation and references this Agreement ("Ordering Document"). ADDITIONAL OR CONFLICTING TERMS IN CUSTOMER'S PURCHASE

ORDER OR OTHER DOCUMENT WILL NOT APPLY, AND THE TERMS OF THIS AGREEMENT WILL GOVERN. This Agreement is effective as of the date of Esri's receipt of an Ordering Document, unless otherwise agreed to by the parties ("Effective Date").

Term of Agreement: Three (3) years
This Agreement supersedes any previous agreements, proposals, presentations, understandings, and arrangements between the parties relating to the licensing of the Products. Except as provided in Article 4— Product Updates, no modifications can be made to this Agreement.

Accepted and Agreed:
(Customer)
By:

Authorized Signature
Printed Name:

Title:

Date:

CUSTOMER CONTACT INFORMATION
Contact: Telephone:

Address: Fax:

City, State, Postal Code: E-mail:

Country:

Quotation Number (if applicable):

1.0—ADDITIONAL DEFINITIONS
In addition to the definitions provided in the Master
Agreement, the following definitions apply to this
Agreement:
"Case" means a failure of the Software or Online
Services to operate according to the Documentation
where such failure substantially impacts operational
or functional performance.
"Deploy", "Deployed" and "Deployment" mean to
redistribute and install the Products and related
Authorization Codes within Customer's
organization(s).
"Fee" means the fee set forth in the Quotation.
"Maintenance" means Tier 2 Support, Product
updates, and Product patches provided to Customer
during the Term of Agreement.
"Master Agreement" means the applicable master
agreement for Esri Products incorporated by this
reference that is (i) found at https://www.esri.com/enus/legal/terms/full-master-agreement and available in the installation process requiring acceptance by
electronic acknowledgment or (ii) a signed Esri
master agreement or license agreement that
supersedes such electronically acknowledged
master agreement.
"Product(s)" means the products identified in
Table A—List of Products and any updates to the list
Esri provides in writing.
"Quotation" means the offer letter and quotation
provided separately to Customer.
"Technical Support" means the technical
assistance for attempting resolution of a reported
Case through error correction, patches, hot fixes,
workarounds, replacement deliveries, or any other
type of Product corrections or modifications.
"Tier 1 Help Desk" means Customer's point of
contact(s) to provide all Tier 1 Support within
Customer's organization(s).
"Tier 1 Support" means the Technical Support
provided by the Tier 1 Help Desk.
"Tier 2 Support" means the Esri Technical Support
provided to the Tier 1 Help Desk when a Case
cannot be resolved through Tier 1 Support.

2.0—ADDITIONAL GRANT OF LICENSE

2.1 Grant of License. Subject to the terms and
conditions of this Agreement, Esri grants to
Customer a personal, nonexclusive,
nontransferable license solely to use, copy, and
Deploy quantities of the Products listed in
Table A—List of Products for the Term of
Agreement (i) for the applicable Fee and (ii) in
accordance with the Master Agreement.

2.2 Consultant Access. Esri grants Customer the
right to permit Customer's consultants or
contractors to use the Products exclusively for
Customer's benefit. Customer will be solely
responsible for compliance by consultants and
contractors with this Agreement and will ensure
that the consultant or contractor discontinues
use of Products upon completion of work for
Customer. Access to or use of Products by
consultants or contractors not exclusively for
Customer's benefit is prohibited. Customer may
not permit its consultants or contractors to install
Software or Data on consultant, contractor, or
third-party computers or remove Software or
Data from Customer locations, except for the
purpose of hosting the Software or Data on
Contractor servers for the benefit of Customer.

3.0—TERM, TERMINATION, AND EXPIRATION

3.1 Term. This Agreement and all licenses
hereunder will commence on the Effective Date
and continue for the duration identified in the
Term of Agreement, unless this Agreement is
terminated earlier as provided herein. Customer
is only authorized to use Products during the
Term of Agreement. For an Agreement with a
limited term, Esri does not grant Customer an
indefinite or a perpetual license to Products.

3.2 No Use upon Agreement Expiration or
Termination. All Product licenses, all
Maintenance, and Esri User Conference
registrations terminate upon expiration or
termination of this Agreement.

3.3 Termination for a Material Breach. Either party
may terminate this Agreement for a material
breach by the other party. The breaching party
will have thirty (30) days from the date of written
notice to cure any material breach.

3.4 Termination for Lack of Funds. For an
Agreement with government or governmentPage 107 of 364

owned entities, either party may terminate this
Agreement before any subsequent year if
Customer is unable to secure funding through
the legislative or governing body's approval
process.

3.5 Follow-on Term. If the parties enter into
another agreement substantially similar to this
Agreement for an additional term, the effective
date of the follow-on agreement will be the day
after the expiration date of this Agreement.

4.0—PRODUCT UPDATES

4.1 Future Updates. Esri reserves the right to
update the list of Products in Table A—List of
Products by providing written notice to
Customer. Customer may continue to use all
Products that have been Deployed, but support
and upgrades for deleted items may not be
available. As new Products are incorporated into
the standard program, they will be offered to
Customer via written notice for incorporation into
the Products schedule at no additional charge.

Customer's use of new or updated Products
requires Customer to adhere to applicable
additional or revised terms and conditions in the
Master Agreement.

4.2 Product Life Cycle. During the Term of
Agreement, some Products may be retired or
may no longer be available to Deploy in the
identified quantities. Maintenance will be subject
to the individual Product Life Cycle Support
Status and Product Life Cycle Support Policy,
which can be found at
https://support.esri.com/en/otherresources/product-life-cycle. Updates for Products in the mature and retired phases may
not be available. Customer may continue to use
Products already Deployed, but Customer will
not be able to Deploy retired Products.

5.0—MAINTENANCE
The Fee includes standard maintenance benefits
during the Term of Agreement as specified in the
most current applicable Esri Maintenance and
Support Program document (found at
https://www.esri.com/enus/legal/terms/maintenance). At Esri's sole discretion, Esri may make patches, hot fixes, or
updates available for download. No Software other
than the defined Products will receive Maintenance.

Customer may acquire maintenance for other
Software outside this Agreement.
a. Tier 1 Support

1. Customer will provide Tier 1 Support
through the Tier 1 Help Desk to all
Customer's authorized users.

2. The Tier 1 Help Desk will be fully trained in
the Products.

3. At a minimum, Tier 1 Support will include
those activities that assist the user in
resolving how-to and operational questions
as well as questions on installation and
troubleshooting procedures.

4. The Tier 1 Help Desk will be the initial point
of contact for all questions and reporting of a
Case. The Tier 1 Help Desk will obtain a full
description of each reported Case and the
system configuration from the user. This
may include obtaining any customizations,
code samples, or data involved in the Case.

5. If the Tier 1 Help Desk cannot resolve the
Case, an authorized Tier 1 Help Desk
individual may contact Tier 2 Support. The
Tier 1 Help Desk will provide support in such
a way as to minimize repeat calls and make
solutions to problems available to
Customer’s organization.

6. Tier 1 Help Desk individuals are the only
individuals authorized to contact Tier 2
Support. Customer may change the Tier 1
Help Desk individuals by written notice to
Esri.
b. Tier 2 Support

1. Tier 2 Support will log the calls received
from Tier 1 Help Desk.

2. Tier 2 Support will review all information
collected by and received from the Tier 1
Help Desk including preliminary documented
troubleshooting provided by the Tier 1 Help
Desk when Tier 2 Support is required.

3. Tier 2 Support may request that Tier 1 Help
Desk individuals provide verification of
information, additional information, or
answers to additional questions to

supplement any preliminary information
gathering or troubleshooting performed by
Tier 1 Help Desk.

4. Tier 2 Support will attempt to resolve the
Case submitted by Tier 1 Help Desk.

5. When the Case is resolved, Tier 2 Support
will communicate the information to Tier 1
Help Desk, and Tier 1 Help Desk will
disseminate the resolution to the user(s).

6.0—ENDORSEMENT AND PUBLICITY
This Agreement will not be construed or interpreted
as an exclusive dealings agreement or Customer's
endorsement of Products. Either party may publicize
the existence of this Agreement.

7.0—ADMINISTRATIVE REQUIREMENTS

7.1 OEM Licenses. Under Esri's OEM or Solution
OEM programs, OEM partners are authorized to
embed or bundle portions of Esri products and
services with their application or service. OEM
partners' business model, licensing terms and
conditions, and pricing are independent of this
Agreement. Customer will not seek any discount
from the OEM partner or Esri based on the
availability of Products under this Agreement.

Customer will not decouple Esri products or
services from the OEM partners' application or
service.

7.2 Annual Report of Deployments. At each
anniversary date and ninety (90) calendar days
prior to the expiration of this Agreement,
Customer will provide Esri with a written report
detailing all Deployments. Upon request,
Customer will provide records sufficient to verify
the accuracy of the annual report.

8.0—ORDERING, ADMINISTRATIVE

PROCEDURES, DELIVERY, AND

DEPLOYMENT

8.1 Orders, Delivery, and Deployment
a. Upon the Effective Date, Esri will invoice
Customer and provide Authorization Codes to
activate the nondestructive copy protection
program that enables Customer to download,
operate, or allow access to the Products. If this
is a multi-year Agreement, Esri may invoice the
Fee up to thirty (30) calendar days before the
annual anniversary date for each year.
b. Undisputed invoices will be due and payable
within thirty (30) calendar days from the date of
invoice. Esri reserves the right to suspend
Customer's access to and use of Products if
Customer fails to pay any undisputed amount
owed on or before its due date. Esri may charge
Customer interest at a monthly rate equal to the
lesser of one percent (1.0%) per month or the
maximum rate permitted by applicable law on
any overdue fees plus all expenses of collection
for any overdue balance that remains unpaid
ten (10) days after Esri has notified Customer of
the past-due balance.
c. Esri's federal ID number is 95-2775-732.
d. If requested, Esri will ship backup media to the
ship-to address identified on the Ordering
Document, FOB Destination, with shipping
charges prepaid. Customer acknowledges that
should sales or use taxes become due as a
result of any shipments of tangible media, Esri
has a right to invoice and Customer will pay any
such sales or use tax associated with the receipt
of tangible media.

8.2 Order Requirements. Esri does not require
Customer to issue a purchase order. Customer
may submit a purchase order in accordance with
its own process requirements, provided that if
Customer issues a purchase order, Customer
will submit its initial purchase order on the
Effective Date. If this is a multi-year Agreement,
Customer will submit subsequent purchase
orders to Esri at least thirty (30) calendar days
before the annual anniversary date for each
year.
a. All orders pertaining to this Agreement will be
processed through Customer's centralized point
of contact.
b. The following information will be included in
each Ordering Document:
(1) Customer name; Esri customer number, if
known; and bill-to and ship-to addresses
(2) Order number
(3) Applicable annual payment due

9.0—MERGERS, ACQUISITIONS, OR

DIVESTITURES
If Customer is a commercial entity, Customer will
notify Esri in writing in the event of (i) a
consolidation, merger, or reorganization of Customer
with or into another corporation or entity;
(ii) Customer's acquisition of another entity; or (iii) a transfer or sale of all or part of Customer's
organization (subsections i, ii, and iii, collectively
referred to as "Ownership Change"). There will be
no decrease in Fee as a result of any Ownership
Change.

9.1 If an Ownership Change increases the
cumulative program count beyond the maximum
level for this Agreement, Esri reserves the right
to increase the Fee or terminate this Agreement
and the parties will negotiate a new agreement.

9.2 If an Ownership Change results in transfer or
sale of a portion of Customer's organization, that
portion of Customer's organization will transfer
the Products to Customer or uninstall, remove,
and destroy all copies of the Products.

9.3 This Agreement may not be assigned to a
successor entity as a result of an Ownership
Change unless approved by Esri in writing in
advance. If the assignment to the new entity is
not approved, Customer will require any
successor entity to uninstall, remove, and
destroy the Products. This Agreement will
terminate upon such Ownership Change.

Master Agreement
E204CW

Revised April 1, 2022
IMPORTANT—READ CAREFULLY
Unless superseded by a signed license agreement between you and Esri, Esri is willing to provide Esri Offerings and Services to you only if you accept all terms and conditions contained in this Agreement as the sole and final agreement of the parties regarding your acquisition of these Esri Offerings and Services. Please read the terms and conditions carefully. You may not use the Esri Offerings until you have agreed to the terms and conditions of the Agreement. If you do not agree to the terms and conditions as stated, click "I do not accept the Master Agreement" below; you may then request a refund of applicable fees paid.

This Master Agreement ("Agreement") is between you ("Customer") and Environmental Systems Research Institute, Inc. ("Esri"), a California corporation with a place of business at 380 New York Street, Redlands, California 92373-8100 USA.

Attachment A contains definitions of capitalized terms used throughout this Agreement. Each section of this Agreement may include additional definitions that are used exclusively within that section.

1.0 GENERAL GRANT OF RIGHTS AND RESTRICTIONS

1.1 Grant of Rights. In consideration of Customer's payment of all applicable fees and in accordance with this Agreement, Esri
a. Provides Services as set forth in this Agreement;
b. Grants to Customer a nonexclusive, nontransferable right and license or subscription to access and use Esri Offerings as set forth in the Specifications and applicable Ordering Documents; and c. Authorizes Customer to copy and make derivative works of the Documentation for Customer's own internal use in conjunction with Customer's authorized use of Esri Offerings. Customer will include the following copyright attribution notice acknowledging the proprietary rights of Esri and its licensors in any derivative work:
"Portions of this document include intellectual property of Esri and its licensors and are used under license. Copyright © [Customer will insert the actual copyright date(s) from the source materials.] Esri and its licensors. All rights reserved."
The grants of rights in this section (i) continue for the duration of the subscription or applicable Term or perpetually if no Term is applicable or identified in the Ordering Documents and (ii) are subject to additional rights and restrictions in this Agreement including Attachment B.

1.2 Consultant or Contractor Access. Customer may authorize its consultants or contractors to (i) host Esri Offerings for Customer's benefit and (ii) use Esri Offerings exclusively for Customer's benefit. Customer will be solely responsible for its consultants' and contractors' compliance with this Agreement and will ensure that each consultant or contractor discontinues use of Esri Offerings upon completion of work for Customer. Access to or use of Esri Offerings by consultants or contractors that is not exclusively for Customer's benefit is prohibited.

1.3 Reservation of Rights. All Esri Offerings are the copyrighted works of Esri or its licensors; all rights not specifically granted in this Agreement are reserved.

1.4 Customer Content. Esri does not acquire any rights in Customer Content under this Agreement other than as needed to provide Esri Offerings and Services to Customer.

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2.0 SOFTWARE AND ONLINE SERVICES

2.1 Definitions. The following definitions supplement the definitions provided in Attachment A:
a. "Anonymous Users" means all who have public access (i.e., without having to provide a Named User Credential) to any part of Customer Content or Customer's Value-Added Applications. b. "App Login Credential(s)" means a system-generated application login and associated password, provided when registering a Value-Added Application with Online Services, which when embedded in a Value-Added Application allows the Value-Added Application to access and use Online Services. c. "Commercial App Deployment License" means a license to distribute Value-Added Applications to third parties for a fee.
d. "Concurrent Use License" means a license to install and use Software on computer(s) on a network, provided that the number of simultaneous users may not exceed the number of licenses acquired. A Concurrent Use License includes the right to run passive failover instances of Concurrent Use License management software in a separate operating system environment for temporary failover support. e. "Deployment License" means a license to incorporate ArcGIS Runtime components in Value-Added Applications and distribute Value-Added Applications to Customer's end users. f. "Deployment Server License" means a license to use Software under a Server License for all uses permitted in this Agreement and as described in the Documentation. g. "Development Server License" means a license to use Software under a Server License only to build and test Value-Added Applications as described in the Documentation. h. "Development Use" means the right to install and use Products to build and test Value-Added Applications as described in the Documentation.
i. "Dual Use License" means the right to install Software on a desktop computer and use it simultaneously with either a personal digital assistant (PDA) or handheld mobile device as long as the Software is only used by a single individual at any time.
j. "Failover License" means a license to install Software on redundant systems for failover operations, but the redundantly installed Software may be operational only during the period the primary site is nonoperational.

Except for system maintenance and updating of databases, the redundant Software installation(s) will remain dormant while the primary site (or any other redundant site) is operational. k. "Named User(s)" is Customer's employee, agent, consultant, or contractor to whom Customer has assigned a unique, secure login credential (identity) enabling access to a Product that requires such identity in order to access identity-managed capabilities within a Product for Customer's exclusive benefit. For educational use, Named Users may include registered students.
l. "Named User Credential(s)" means an individual person's login and associated password enabling that person to access and use Products.
m. "Named User License" means the right for a single Named User to use a specific Esri Offering. n. "Online Services Subscription" means a limited-term subscription conveying the right for one or more Named Users to access and use Online Services.
o. "Redistribution License" means a license to reproduce and distribute Software provided that

1. Customer reproduces and distributes the Software in its entirety;

2. A license agreement that protects the Software to the same extent as this Agreement accompanies each copy of the Software, and the recipient agrees to the terms and conditions of the license agreement;

3. Customer reproduces all copyright and trademark attributions and notices; and

4. Customer does not charge a fee to others for the use of the Software. p. "Server License" means a license to install and use Software on any computer being used as a server.

Server Licenses may be subject to a limited number of server cores or distributed deployment on multiple servers as described in the Ordering Documents or Documentation. If the Software description includes failover use rights, each Server License includes a Failover License. q. "Service Credit(s)" means a unit of exchange for consumption of services that can be used with an Online Services Subscription.
r. "Sharing Tools" means publishing capabilities included with Customer's authorized use of Online Services or ArcGIS Enterprise that allow Customer to make Customer Content and Value-Added Applications available to third parties or Anonymous Users.

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s. "Single Use License" means a license for a single authorized end user to install and use Software on a single computer. The single authorized end user may also install a second copy for the end user's exclusive use on a second computer as long as only 1 copy of Software is in use at any time. No other end user may use Software under the same license at the same time for any other purpose. t. "Staging Server License" means a license to use Software under a Server License to build and test ValueAdded Applications and map caches; conduct user acceptance, performance, and load testing of other thirdparty software; stage new commercial data updates; and conduct training activities as described in the Documentation. Customer may use Value-Added Applications and map caches with Development and Deployment Server Licenses.

2.2 License and Subscription Types. Esri provides Products under one or more of the license or subscription types identified in the definitions above. The Documentation and Ordering Documents identify which license or subscription type(s) applies to the ordered Products.

2.3 Software Terms of Use.
a. Customer may

1. Install, access, or store Software and Data on electronic storage device(s);

2. Make archival copies and routine computer backups;

3. Install and use a newer version of Software concurrently with the version to be replaced during a reasonable transition period not to exceed 6 months, provided that the deployment of either version does not exceed Customer's licensed quantity; thereafter, Customer will not use more Software in the aggregate than Customer's total licensed quantity. This concurrent use right does not apply to Software licensed for Development Use;

4. Move Software in the licensed configuration to a replacement computer;

5. Distribute Software and any associated Authorization Codes required for use of a Deployment License to third parties; and

6. Governmental or not-for-profit organizations that operate a website or offer Internet services may use server Software for revenue-generating purposes on a cost-recovery basis and not for profit. b. Customer may customize Software using any macro or scripting language, APIs, or source or object code libraries but only to the extent that such customization is described in the Documentation. c. Customer may use all fonts provided with Software for any authorized use of the Software. Customer may also use Esri fonts separately to print any output created by the Software. Any use restrictions for third-party fonts included with the Software are set forth in the font file itself. d. Esri publishes Product-specific Software terms of use at https://www.esri.com/legal/scope-of-use.

2.4 Online Services Terms of Use.
a. Online Services Descriptions. Esri publishes Online Services Subscription-specific terms of use at https://www.esri.com/legal/scope-of-use. Use of Online Services is also subject to the Cloud Services terms found in Attachment B.
b. Modifications of Online Services. Esri may change Online Services and associated APIs at any time, subject to 30 days' notice of material changes and 90 days' notice for deprecations. If any modification, discontinuation, or deprecation of Online Services causes a material, adverse impact to Customer's operations, Esri may, at its discretion, attempt to repair, correct, or provide a workaround for Online Services.

If a viable solution is not commercially reasonable, Customer may cancel its subscription to Online Services, and when applicable, Esri will issue a prorated refund. c. Sharing Customer Content. Sharing Customer Content using Sharing Tools enables third parties to use, store, cache, copy, reproduce, (re)distribute, and (re)transmit Customer Content through Online Services. Esri is not responsible for any loss, deletion, modification, or disclosure of Customer Content resulting from use or misuse of Sharing Tools. Customer's use of Sharing Tools is at Customer's sole risk.

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2.5 Named User Licenses. Except as expressly set forth in this Agreement, the following terms apply to Software and Online Services for which Customer acquires Named User Licenses. a. Named Users.

1. Named User login credentials are for designated users only and may not be shared with other individuals.

2. Customer may reassign a Named User License to another user if the former user no longer requires access to the Software or Online Services.

3. Customer may not add third parties as Named Users, other than third parties included within the definition of Named Users.
b. Anonymous Users. Anonymous Users may only access Software or Online Services through Value-Added Applications that provide access to services or Content, that has been published for shared access through the use of Sharing Tools.

2.6 Value-Added Applications.

1. Customer is responsible for the development, operation, and technical support of Customer Content and Value-Added Applications.

2. Customer may not embed a Named User Credential into Value-Added Applications. Value-Added Applications that enable access to Customer Content that is not publicly shared through the use of Sharing Tools must require individual users to log in to the application(s) with their unique Named User login credentials.

3. Customer may embed an App Login Credential into Value-Added Applications that provide access by Anonymous Users to services or Content, that has been published for shared access by Anonymous Users through the use of Sharing Tools.

4. Customer may not embed an App Login Credential into Value-Added Applications that enables access to Customer Content that is not publicly shared through the use of Sharing Tools. Value-Added Applications that enable access to Customer Content that is not publicly shared through the use of Sharing Tools must require individual users to log in to the application(s) with their unique Named User login credentials.

5. Customer may not provide a third party, other than third parties included within the definition of Named Users, with access to Software or Online Services, other than through Customer's Value-Added Application(s).

6. Customer may transfer Value-Added Applications to any third party for use in conjunction with the third party's own Software license or Online Services Subscription.

2.7 Limited-Use Programs.
a. Trial, Evaluation, and Beta Programs. Products acquired under a trial, evaluation, or Beta program are licensed for evaluation and testing purposes only and not for commercial use. Any such use is at Customer's own risk, and the Products do not qualify for Maintenance. If Customer does not convert to a purchased license or subscription prior to the expiration of the trial, evaluation, or Beta license, Customer may lose any Customer Content and customizations made during the license term. If Customer does not wish to purchase a license or subscription, Customer should export such Customer Content before the license expires. b. Educational Programs. Customer agrees to use Products provided under an educational program solely for educational purposes during the educational use Term. Customer shall not use Products for any Administrative Use unless Customer has acquired an Administrative Use license. "Administrative Use" means administrative activities that are not directly related to instruction or education, such as asset mapping, facilities management, demographic analysis, routing, campus safety, and accessibility analysis. Customer shall not use Products for revenue-generating or for-profit purposes. c. Grant Programs. Customer may use Products provided under a grant program for noncommercial purposes only. Except for cost recovery of using and operating the Products, Customer shall not use Products for revenue-generating or for-profit purposes.
d. Other Esri Limited-Use Programs. If Customer acquires Products under any limited-use program not listed above, Customer's use of the Products may be subject to the terms set forth in the applicable launching page or enrollment form or as described on Esri's website in addition to the nonconflicting terms of this Agreement.

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3.0 DATA

3.1 Definitions. The following definitions supplement the definitions provided in Attachment A:
a. "Business Listing Data" means any dataset that includes a list of businesses and may include other associated business attributes.
b. "Esri Content Package(s)" means a digital file containing Online Services basemap Data extracted from the Online Services.
c. "Street Data" means Data that includes or depicts information about roads, streets, and related features.

3.2 Permitted Uses.
a. Unless otherwise authorized in writing, Customer may only use Data with the Products for which Esri has provided the Data.
b. Subject to the restrictions set forth in this Agreement and provided that Customer affixes an attribution statement to the Data representations acknowledging Esri or its applicable licensor(s) as the source of the portion(s) of the Data used for the Data representation, Customer may:

1. Create representations of Data in hard-copy or static, electronic format (e.g., PDF, GIF, JPEG, HTML); in ArcGIS Web Maps; or in Esri Story Maps apps for the purposes of visualizing Data (including basic interactions such as panning, zooming, and identifying map features with simple pop-ups); and

2. Use and include such representations of Data in presentation packages, marketing studies, or other reports or documents containing map images or data summaries derived from the use of Esri Products to third parties.
c. Customer may take Online Services basemaps offline through Esri Content Packages and subsequently deliver (transfer) them to any device for use with licensed ArcGIS Runtime applications and ArcGIS Desktop.

Customer may not otherwise scrape, download, or store Data. d. Customer may make any internal use of geocoded results that are obtained and stored in compliance with this Agreement. Customer may not redistribute geocoded results except to (i) use and/or display on a map in connection with Customer's public, non-revenue generating website(s), (ii) permit access to third-parties for the purposes of Customer's business, or (iii) deliver to third parties, on a noncommercial/non-revenue generating basis, static results, static output or static base map renderings.

3.3 Use Restrictions.
a. Customer may not act directly or authorize its customers to cobrand Data, use Data in any unauthorized service or product, or offer Data through or on behalf of any third party. b. Customer may not use or allow third parties to use Data, for the purpose of compiling, enhancing, verifying, supplementing, adding to, or deleting from compilation of information that is sold, rented, published, furnished, or in any manner provided to a third party.
c. Business Listing Data. Unless authorized in writing, Customer may not use Business Listing Data for any direct marketing purposes, resale publication, or distribution to any third party as part of any mailing list, directory, classified advertising, or other compilation of information. d. Street Data. Customer may use Street Data for mapping, geocoding, routing, and transportation network analysis purposes. Unless otherwise authorized in writing, Customer may not use Street Data for

1. Real-time navigational guidance, including alerting a user about upcoming maneuvers, such as warning of an upcoming turn or calculating an alternate route if a turn is missed;

2. Synchronized multivehicle routing; or

3. Synchronized route optimization.
e. Business Analyst Data. Customer may cache Data provided with ArcGIS Business Analyst Mobile App on a mobile device for use in conjunction with its use of ArcGIS Business Analyst Server. Customer may not otherwise cache or download such Data.

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f. Partial Dataset Licenses: If Customer orders a subset of a dataset (e.g., a country, region, state, or local portion of a global database), Customer may use only the licensed subset, not any other portion of the full dataset.
g. Michael Bauer Research International Boundaries Data ("MBR Data"). Customer's right to use data downloaded to Customer's premises (e.g., MBR Data stored in ArcGIS Enterprise, ArcGIS Desktop) terminates 2 years after download.

3.4 Supplemental Terms and Conditions for Data. Certain Data licensors require Esri to flow down additional attribution requirements and terms of use to Customer. These terms supplement and amend the terms of this Agreement and are available at www.esri.com/legal/third-party-data.

4.0 MAINTENANCE

4.1 US Customers. Esri will provide Maintenance for Software and Online Services in accordance with the Esri Maintenance and Support Program and this Agreement if Customer is in the United States.

4.2 Customers outside the United States. Customer may obtain maintenance services from their local Esri authorized distributor under the authorized distributor's own standard support policy.

5.0 SERVICES

5.1 US Customers. Esri may provide Esri Managed Cloud Services, Training, or Professional Services including Advantage Program to US Customers under an applicable Ordering Document. Unless Customer has signed an agreement with Esri establishing terms and conditions for such Services, Esri's performance is subject to the Services terms and conditions incorporated by reference and found at https://www.esri.com/content/dam/esrisites/en-us/media/legal/services/ma-services.pdf. A printed copy of these terms and conditions will be provided upon request.

5.2 Customers outside the United States. Customers outside of the United States may obtain Services from their local authorized distributor.

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ATTACHMENT A

GLOSSARY OF TERMS
The following glossary of terms applies to all Esri Offerings and Services that Esri may provide to its customers.

Certain Esri Offerings or Services may not be within the scope of this Agreement. Please disregard any terms that are not applicable to Esri Offerings or Services offered under this Agreement. "Affiliate" means any entity that directly or indirectly (i) Controls; (ii) is Controlled by; or (iii) is under common Control with a party, where "Control" means having more than 50 percent of the voting stock or other voting interest in the Controlled entity.
"API" means application programming interface.
"ArcGIS Website" means www.arcgis.com and any related or successor websites. "Authorization Code(s)" means any key, authorization number, enablement code, login credential, activation code, token, user name and password, or other mechanism required for use of Esri Offerings. "Beta" means any alpha, beta, or other prerelease version of a Product. "Cloud Services" means Online Services and Esri Managed Cloud Services. "Content" means data, images, photographs, animations, video, audio, text, maps, databases, data models, spreadsheets, user interfaces, graphics components, icons, software, and other resources used in connection with Esri Offerings and Services.
"Control" means having more than 50 percent of the voting stock or other voting interest in the Controlled entity. "Customer Content" means any Content that Customer provides, uses, or develops in connection with Customer's use of Esri Offerings or Services, including Value-Added Applications. Customer Content excludes any feedback, suggestions, or requests for improvements that Customer provides to Esri. "Data" means any commercially available digital dataset(s) including, but not limited to, geographic vector data, raster data reports, or associated tabular attributes that Esri bundles with other Esri Offerings or delivers independently.
"Deliverables" means anything that Esri delivers to Customer as a result of performance of Professional Services.
"Documentation" means all user reference documentation that Esri provides with a Deliverable or an Esri Offering.
"Esri Managed Cloud Services" means a Customer-specific cloud infrastructure, Software, Data, and network platform that Esri hosts, manages, and makes available to Customer or Customer's end users via the Internet. "Esri Offering(s)" means any Product or Documentation. If Esri provides Training or Professional Services directly to Customer, then Esri Offerings also include Deliverables and Training Materials. Esri Offerings exclude Services and Third-Party Content.
"GIS" means geographic information system.
"Maintenance" means a subscription program that Esri provides and that entitles Customer to Product updates and other benefits such as access to technical support and self-paced, web-based learning resources.

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"Malicious Code" means software viruses; worms; time bombs; Trojan horses; or any other computer code, files, denial of service, or programs designed to interrupt, destroy, or limit the functionality of any computer software, hardware, or telecommunications equipment.
"Online Services" means any commercially available, Internet-based geospatial system that Esri provides, including applications and associated APIs for storing, managing, publishing, and using maps, data, and other information. Online Services exclude Data and Content.
"Ordering Document(s)" means a sales quotation, Maintenance renewal quote, purchase order, proposal, Task Order, or other document identifying Esri Offerings, updates, or Services that Customer orders. "Perpetual License" means a license to use a version of the Esri Offering for which applicable license fees have been paid, indefinitely, unless terminated by Esri or Customer as authorized under this Agreement. "Product(s)" means Software, Data, and Online Services. "Professional Services" means any development or consulting services that Esri provides to Customer. "Sample(s)" means sample code, sample applications, add-ons, or sample extensions of Products. "Service(s)" means Maintenance. If Esri provides Esri Managed Cloud Services, Training, or Professional Services directly to Customer, then Services also include Esri Managed Cloud Services, Training, and Professional Services.
"Software" means any proprietary commercial off-the-shelf software, excluding Data, accessed or downloaded from an Esri-authorized website or that Esri delivers on any media in any format including backups, updates, service packs, patches, hot fixes, or permitted merged copies. "Specification(s)" means (i) the Documentation for Software and Online Services, (ii) the scope of work set forth in any Task Order, or (iii) Esri's published course descriptions for Training. "Task Order(s)" means an Ordering Document for Services. "Term License" means a license for use of an Esri Offering for a limited time period ("Term"). "Third-Party Content" means any Content that Customer may obtain from a third-party website or that persons other than Esri employees, suppliers, or contractors may directly contribute to Esri's website. "Training" means (i) Product training or (ii) related training that Esri provides under this Agreement. "Training Materials" means digital or printed Content required to complete Training, which may include, but is not limited to, workbooks, data, concepts, exercises, assessments, and exams. "Value-Added Application(s)" means an application developed by Customer for use in conjunction with the authorized use of any Software, Data, or Online Services.

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ATTACHMENT B

GENERAL TERMS AND CONDITIONS
The following general terms and conditions apply to all Esri Offerings and Services that Esri may offer to its customers. Certain Esri Offerings or Services may not be available under this Agreement. Please disregard any terms that are not applicable to Esri Offerings or Services offered under this Agreement.

ARTICLE B.1—GENERAL USE RESTRICTIONS
Except as expressly permitted in this Agreement, Customer will not a. Sell, rent, lease, sublicense, distribute, lend, time-share, or assign Services or Esri Offerings; b. Distribute or provide direct access to Services or Esri Offerings to third parties, in whole or in part, including, but not limited to, extensions, components, or DLLs;
c. Distribute Authorization Codes to third parties;
d. Reverse engineer, decompile, or disassemble any Product or Deliverable delivered in compiled form; e. Make any attempt to circumvent the technological measure(s) that controls access to or use of Esri Offerings; f. Store, cache, use, upload, distribute, or sublicense Content or otherwise use Esri Offerings in violation of Esri's or a third-party's rights, including intellectual property rights, privacy rights, nondiscrimination laws, export laws, or any other applicable law or regulation; g. Remove or obscure any Esri or its licensors' patent, copyright, trademark, proprietary rights notices, or legends contained in or affixed to any Esri Offerings, output, metadata file, or online or hard-copy attribution page of any Data or Documentation;
h. Unbundle or independently use individual or component parts of Esri Offerings; i. Incorporate any portion of Esri Offerings into a product or service for third-party use that competes with the Esri Offerings;
j. Publish or in any other way communicate the results of benchmark tests run on Beta Products without the prior written permission of Esri and its licensors; or
k. Use, incorporate, modify, distribute, provide access to, or combine any Esri Offerings in a manner that would subject any Esri Offering to open-source or open-database license terms (e.g. GPL) that require any part of the Esri Offering to be subject to additional terms, for example

1. Disclosed in source code form to third parties;

2. Licensed to third parties for the purpose of making derivative works; or

3. Redistributable to third parties at no charge; or
l. Generate revenue by providing access to Software or Online Services through a Value-Added Application.

These restrictions will not apply to the extent that they conflict with applicable law or regulation.

ARTICLE B.2—TERM AND TERMINATION
B.2.1 Customer may terminate this Agreement or any Esri Offerings license or subscription at any time upon written notice to Esri. Termination without cause does not entitle Customer to receive any refund of fees paid. Any right to terminate pending Services engagements for convenience is set forth in the applicable section in the body of this Agreement. Either party may terminate this Agreement or any license or subscription for a material breach that is not cured within 30 days of written notice to the breaching party. Upon any termination of this Agreement for breach, Esri will stop providing Services. Any licenses in Esri Offerings that survive termination of this Agreement continue under the terms of this Agreement.

B.2.2 If Esri terminates this Agreement following Customer's breach, then Esri may also, at its election, terminate Customer's licenses or subscriptions to Esri Offerings. If Customer terminates this Agreement for cause or convenience, then Customer may, at its election, also terminate Customer's licenses or subscriptions to Esri Offerings.

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B.2.3 Upon any termination or expiration of a license or subscription, Customer will a. Stop accessing and using the terminated or expired Esri Offerings; b. Clear any client-side data cache derived from the terminated or expired Cloud Services; and c. Stop using and uninstall, remove, and destroy all copies of the terminated or expired Esri Offerings in Customer's possession or control, including any modified or merged portions thereof, in any form, and execute and deliver evidence of such actions to Esri or its authorized distributor.

Esri may stop performing Services immediately upon written notice to Customer if a bankruptcy or insolvency proceeding is commenced by or against Customer until the trustee cures any existing defaults and provides adequate assurance of future performance under this Agreement. This Agreement terminates upon the insolvency, liquidation, or dissolution of either party.

ARTICLE B.3—LIMITED WARRANTIES AND DISCLAIMERS
B.3.1 Limited Warranties. Except as disclaimed below, Esri warrants to Customer that (i) Products and Training will substantially comply with the applicable Specifications and (ii) Services will substantially conform to the professional and technical standards of the industry. The warranty period for Esri Offerings offered under a Perpetual License and for Services runs for 90 days from the date of delivery or from the date of acceptance if this Agreement provides an acceptance period. The warranty period for Esri Offerings offered under a subscription or Term License basis runs for the lesser of (i) the duration of the subscription or term or (ii) 90 days from delivery or acceptance if this Agreement provides an acceptance period.

B.3.2 Special Disclaimer. Third-Party Content; Data; Samples; hot fixes; patches; updates; Online Services provided at no charge; and trial, evaluation, and Beta Products are delivered "as is" and without warranty of any kind.

B.3.3 General Disclaimer. Except for the express limited warranties set forth in this Agreement, Esri disclaims all other warranties or conditions of any kind, whether express or implied, including, but not limited to, warranties or conditions of merchantability, fitness for a particular purpose, and noninfringement of intellectual property rights. Esri is not responsible for any nonconformities with Specifications or loss, deletion, modification, or disclosure of Customer Content caused by Customer's modification of any Esri Offering other than as specified in the Documentation. Esri does not warrant that Esri Offerings, or Customer's operation of the same, will be uninterrupted, error free, fault tolerant, or failsafe or that all nonconformities can or will be corrected. Esri Offerings are not designed, manufactured, or intended for use in environments or applications that may lead to death, personal injury, or physical property or environmental damage. Customer should not follow any navigational route suggestions that appear to be hazardous, unsafe, or illegal. Any such uses will be at Customer's own risk and cost.

B.3.4 Disclaimers.
a. Internet Disclaimer. Neither party will be liable for damages under any theory of law related to the performance or discontinuance of operation of the Internet or to regulation of the Internet that might restrict or prohibit the operation of Cloud Services.
b. Third-Party Websites; Third-Party Content. Esri is not responsible for any third-party website or ThirdParty Content that appears in or is referenced by Esri Offerings or Esri websites, including www.esri.com, developers.arcgis.com, livingatlas.arcgis.com and www.arcgis.com. Providing links to third-party websites and resources does not imply an endorsement, affiliation, or sponsorship of any kind.

B.3.5 Exclusive Remedy. Customer's exclusive remedy and Esri's entire liability for breach of the limited warranties in this section will be to replace any defective media and to (i) repair, correct, or provide a workaround for the applicable Esri Offering or Services or (ii) at Esri's election, terminate Customer's right to use and refund the fees paid for Esri Offerings or Services that do not meet Esri's limited warranties.

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ARTICLE B.4—LIMITATION OF LIABILITY
B.4.1 Disclaimer of Liability. Neither Customer, Esri, nor any Esri authorized distributor or third party licensor will be liable for any indirect, special, incidental, or consequential damages; lost profits; lost sales; loss of goodwill; costs of procurement of substitute goods or services; or damages exceeding the applicable license fees, or current subscription fees, or Services fees paid or owed to Esri for the Esri Offerings or Services giving rise to the cause of action.

B.4.2 The limitations and exclusions of liability in the preceding paragraph do not apply to Customer's infringement, misuse, or misappropriation of Esri's or Esri's licensors' intellectual property rights, either party's indemnification obligations, gross negligence, willful misconduct, or violations of the Export Compliance clause of this Agreement or any applicable law or regulation.

B.4.3 Applicability of Disclaimers and Limitations. Esri or its authorized distributor has set its fees and entered into this Agreement in reliance on the disclaimers and limitations in this Agreement; the fees reflect an allocation of risk that is an essential basis of the bargain between the parties. These limitations will apply whether or not a party is aware of the possibility of any damage and notwithstanding any failure of essential purpose of any exclusive, limited remedy.

B.4.4 The foregoing disclaimers, limitations, and exclusions may be invalid in some jurisdictions and apply only to the extent permitted by applicable law or regulation in Customer's jurisdiction. Customer may have additional rights that may not be waived or disclaimed. Esri does not seek to limit Customer's warranty or remedies to any extent not permitted by law.

ARTICLE B.5—INDEMNIFICATIONS
B.5.1 Definitions. The following definitions supplement the definitions provided in Attachment A:
a. "Claim" means any claim, action, or demand by a third party. b. "Indemnitees" means Customer and its directors, officers, and employees. c. "Infringement Claim(s)" means any Claim alleging that Customer's use of or access to any Esri Offering or Service infringes a patent, copyright, trademark, or trade secret. d. "Loss(es)" means expenditure, damage award, settlement amount, cost, or expense, including awarded attorneys' fees.

B.5.2 Infringement Indemnity.
a. Esri will defend, hold all Indemnitees harmless from, and indemnify any Loss arising out of an Infringement Claim.
b. If Esri determines that an Infringement Claim is valid, Esri may, at its expense, either (i) obtain rights for Customer to continue using the Esri Offerings or Services or (ii) modify the Esri Offerings or Services while maintaining substantially similar functionality. If neither alternative is commercially reasonable, Esri may terminate Customer's right to use the Esri Offerings or Services and will refund any (a) license fees that Customer paid for the infringing Esri Offerings or Services acquired under a Perpetual License, prorated on a 5-year, straight-line depreciation basis beginning from the initial date of delivery or (b) unused portion of fees paid for Term Licenses, Subscriptions, and Maintenance. c. Esri has no obligation to defend an Infringement Claim or to indemnify Customer to the extent the Infringement Claim arises out of (i) the combination or integration of Esri Offerings or Services with a product, process, system, or element that Esri has not supplied or specified in the Specification; (ii) alteration of Esri Offerings or Services by anyone other than Esri or its subcontractors; (iii) compliance with Customer's specifications; or (iv) use of Esri Offerings or Services after Esri either provides a modified version to avoid infringement or terminates Customer's right to use the Esri Offerings or Services.

B.5.3 General Indemnity. Esri will defend and hold all Indemnitees harmless from, and indemnify any Loss arising out of, any Claim for bodily injury, death, or tangible or real property damage brought against any of the Indemnitees to the extent arising from any negligent act or omission or willful misconduct by Esri or its directors, officers, employees, or agents performing Services while on Customer's site.

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B.5.4 Conditions for Indemnification. As conditions for indemnification, but for those defined as Infringement Claims (see B.5.2 c.), Indemnitee will (i) promptly notify Esri in writing of the Claim, (ii) provide all available documents describing the Claim, (iii) give Esri sole control of the defense of any action and negotiation related to the defense or settlement of any Claim, and (iv) reasonably cooperate in the defense of the Claim at Esri's request and expense.

B.5.5 This section sets forth the entire obligation of Esri, its authorized distributor, and its third party licensors regarding any Claim for which Esri must indemnify Customer.

ARTICLE B.6—INSURANCE
If Esri is providing Services, Esri will carry, at a minimum, the following coverage:
a. Comprehensive general liability or commercial general liability with a minimum coverage of $1,000,000.00 (US dollars) combined single limit per occurrence for bodily injury, including death, and property damage liability to include the following:

1. Premises and operations;

2. Blanket contractual liability;

3. Broad form property damage;

4. Independent contractors;

5. Personal injury, with employee exclusion deleted; and

6. Completed operations.
b. Workers' compensation insurance, with waiver of subrogation, in an amount that complies with statutory limits.

ARTICLE B.7—SECURITY AND COMPLIANCE
B.7.1 Security. Esri publishes its security capabilities at https://trust.arcgis.com. Customer may give Esri personnel access to Customer systems or to Customer or third-party personal information, controlled information, or sensitive data if access is essential for Esri's performance of Services and if Esri expressly agrees to such access. Esri will use reasonable administrative, technical, and physical safeguards to protect such data and guard against unauthorized access. Customer bears responsibility to (i) confirm that Esri's published security and privacy controls meet all applicable legal requirements for protection of Customer Content and (ii) upload or share Customer Content through Cloud Services only when it is legal to do so. Esri is not responsible to review Customer Content to ensure compliance with applicable laws and regulations. Customer must contact Esri at [email protected] for further instruction before providing any Customer Content that requires security measures other than Esri's published security capabilities.

B.7.2 Malicious Code. Esri will use commercially reasonable efforts to ensure that Esri Offerings will not transmit any Malicious Code to Customer. Esri is not responsible for Malicious Code that Customer introduces to Esri Offerings or that is introduced through Third-Party Content.

B.7.3 Export Compliance. Each party will comply with all applicable export and trade sanctions laws and regulations, including the US Department of Commerce's Export Administration Regulations (EAR), the US Department of State's International Traffic in Arms Regulations (ITAR), the US Department of Treasury, Office of Foreign Assets Control (OFAC) Regulations, and other applicable export laws. Customer will not export, reexport, transfer, release, or otherwise dispose of, in whole or in part, or permit access to or transfer or use of Services or Esri Offerings to any United States embargoed countries currently including Iran, Syria, North Korea, Cuba, Crimea region of Ukraine, the Donetsk People's Republic (DNR) and Luhansk People's Republic (LNR), or denied entities or persons except in accordance with all then-current applicable US government export laws and regulations. Customer will not export, reexport, transfer, or use Services or Esri Offerings for certain missile, nuclear, chemical, or biological activities or end uses without proper authorization from the US government.

Customer shall immediately notify Esri in writing if any US government entity or agency denies, suspends, or revokes Customer's export privileges. Customer will not upload, store, or process in Cloud Services any Customer Content that (i) has an Export Control Classification Number (ECCN) other than EAR99 or (ii) is controlled for export from the United States under ITAR. Customer will notify Esri in advance if Esri's performance

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of any Services or provision of any Esri Offerings is related to any defense article, defense service, or technical data, as defined under the ITAR Sections 120.6, 120.9, and 120.10, respectively; Esri will not perform any such Services or provide any such Esri Offerings until Esri obtains any necessary export license from the US government. Customer will reasonably assist Esri in applying for and obtaining an export license if needed.

B.7.4 Privacy. Esri will process personal data according to the terms of the Data Processing Addendum available at https://www.esri.com/en-us/privacy/overview.

ARTICLE B.8—CLOUD SERVICES
B.8.1 Prohibited Uses. Customer shall not provide Customer Content or otherwise access or use Cloud Services in a manner that
a. Creates or transmits spam, spoofings, or phishing email or offensive or defamatory material; or stalks or makes threats of physical harm;
b. Stores or transmits any Malicious Code;
c. Violates any law or regulation;
d. Infringes or misappropriates the rights of any third party; e. Probes, scans, or tests the vulnerability of Cloud Services or breach any security or authentication measures used by Cloud Services without written approval from Esri's Product Security Officer; or f. Benchmarks the availability, performance, or functionality of Cloud Services.

B.8.2 Service Interruption. System failures or other events beyond Esri's reasonable control may interrupt Customer's access to Cloud Services. Esri may not be able to provide advance notice of such interruptions.

B.8.3 Customer Content.
a. Customer grants Esri and its subcontractors a nonexclusive, nontransferable, worldwide right to host, run, modify, and reproduce Customer Content as needed to provide Cloud Services to Customer. Esri will not access, use, or disclose Customer Content without Customer's written permission except as reasonably necessary to support Customer's use of Cloud Services. Except for the limited rights granted to Esri under this Agreement, Customer retains all its rights, title, and interest in the Customer Content. b. If Customer accesses Cloud Services with an application provided by a third party, Esri may disclose Customer Content to such third party as necessary to enable interoperation between the application, Cloud Services, and Customer Content.
c. Esri may disclose Customer Content if required to do so by law or regulation or by order of a court or other government body, in which case Esri will reasonably attempt to limit the scope of disclosure. d. When Customer's use of Cloud Services ends, Esri will either

1. Make Customer Content available to Customer for download for a period of 30 days unless Customer requests a shorter window of availability or Esri is legally prohibited from doing so; or

2. Download all Customer Content in Esri's possession to a medium of Customer's choosing and deliver such Customer Content to Customer.

Esri will have no further obligations to store or return Customer Content at the conclusion of the Cloud Services.

B.8.4 Removal of Customer Content. Esri may remove or delete Customer Content if there is reason to believe that uploading Customer Content to or using it with Cloud Services materially violates this Agreement. If reasonable under these circumstances, Esri will notify Customer before removing Customer Content. Esri will respond to any Digital Millennium Copyright Act takedown notices in accordance with Esri's copyright policy, available at www.esri.com/legal/dmca_policy.

B.8.5 Service Suspension. Esri may suspend access to Cloud Services (i) if Customer materially breaches this Agreement and fails to timely cure the breach; (ii) if Esri reasonably believes that Customer's use of Cloud Services will subject Esri to immediate liability or adversely affect the integrity, functionality, or usability of the Cloud Services; (iii) for scheduled maintenance; (iv) to enjoin a threat or attack on Cloud Services; or (v) if Cloud

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Services become prohibited by law or regulated to a degree that continuing to provide them would impose a commercial hardship. When feasible, Esri will notify Customer of any Cloud Services suspension beforehand and give Customer reasonable opportunity to take remedial action.

Esri is not responsible for any damages, liabilities, or losses that may result from any interruption or suspension of Cloud Services or removal of Customer Content as described above.

B.8.6 Notice to Esri. Customer will promptly notify Esri if Customer becomes aware of any unauthorized use of Customer's subscription or any other breach of security regarding Cloud Services.

ARTICLE B.9—GENERAL PROVISIONS
B.9.1 Payment. Customer will pay each correct invoice no later than 30 days after receipt and will remit payment to the address stated on the invoice. Customers outside the United States will pay the authorized distributor's invoices in accordance with the authorized distributor's payment terms.

B.9.2 Feedback. Esri may freely use any feedback, suggestions, or requests for Product improvement that Customer provides to Esri.

B.9.3 Patents. Customer may not seek, and may not permit any other user to seek, a patent or similar right worldwide that is based on or incorporates any Products. This express prohibition on patenting will not apply to Customer's software and technology except to the extent that Products, or any portion thereof, are part of any claim or preferred embodiment in a patent application or a similar application.

B.9.4 Restrictions on Solicitation. Neither party will solicit for hire any employee of the other party who is associated with the performance of Services during the performance of the Services and for a period of 1 year thereafter. This does not restrict either party from publicly advertising positions for hire in newspapers, professional magazines, or Internet postings.

B.9.5 Taxes and Fees; Shipping Charges. Pricing of Esri Offerings and Services that Esri quotes to Customer is exclusive of any and all applicable taxes or fees including, but not limited to, sales tax, use tax, or value-added tax (VAT); customs, duties, or tariffs; shipping and handling charges; and vendor enrollment fees. Esri will add any fees that it is required to pay to the total amount of its invoice to Customer. Esri may include estimated taxes and shipping and handling charges in its quotations but may adjust these fees on invoicing. For Customers outside the United States, the authorized distributor may quote taxes or fees in accordance with its own policies.

B.9.6 Compliance Review. Customer will keep accurate and complete records and accounts pertaining to its compliance with its obligations under this Agreement. Esri or its authorized distributor may conduct a compliance review of these records and accounts with no less than 14 business days' written notice or may appoint an independent third party to conduct such a compliance review on its behalf. Customer will promptly correct any noncompliance identified during the compliance review. Neither Esri nor Esri's authorized distributor may conduct a compliance review of Customer within 12 months after the conclusion of any prior compliance review that does not reveal any material Customer noncompliance.

B.9.7 No Implied Waivers. The failure of either party to enforce any provision of this Agreement is not a waiver of the provisions or of the right of such party thereafter to enforce that or any other provision.

B.9.8 Severability. If any provision of this Agreement is held to be unenforceable for any reason, (i) such provision will be reformed only to the extent necessary to make the intent of the language enforceable, and (ii) all other provisions of this Agreement will remain in effect.

B.9.9 Successor and Assigns. Customer will not assign, sublicense, or transfer Customer's rights or delegate Customer's obligations under this Agreement without Esri's and its authorized distributor's prior written consent, and any attempt to do so without consent will be void. This Agreement will be binding on the respective successors and assigns of the parties to this Agreement. Notwithstanding, a contractor under contract to the government to deliver Products may assign this Agreement and Products acquired for delivery to its government

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customer upon written notice to Esri, provided the government customer assents to the terms of this Agreement.

Upon mutual agreement, Esri's Affiliates may provide Services under the terms of this Agreement; in such cases, the Ordering Documents will identify the Affiliate as the party that provides the Services. Esri's authorized distributors are not Affiliates of Esri.

B.9.10 Survival of Terms. The Glossary of Terms and provisions of the following Articles of these General Terms and Conditions will survive the expiration or termination of this Agreement: "Limited Warranties and Disclaimers," "Limitation of Liability," "Indemnifications," and "General Provisions." B.9.11 US Government Customer. The Products are commercial items, developed at private expense, provided to Customer under this Agreement. If Customer is a US government entity or US government contractor, Esri licenses or provides subscriptions to Customer in accordance with this Agreement under FAR Subparts 12.211/12.212 or DFARS Subpart 227.7202. Esri Data and Online Services are licensed or subscribed under the same DFARS Subpart 227.7202 policy as commercial computer software for acquisitions made under DFARS. Products are subject to restrictions, and this Agreement strictly governs Customer's use, modification, performance, reproduction, release, display, or disclosure of Products. Agreement provisions that are inconsistent with federal law regulation will not apply. A US government Customer may transfer Software to any of its facilities to which it transfers the computer(s) on which it has installed such Software. If any court, arbitrator, or board holds that a US government Customer has greater rights to any portion of Products under applicable public procurement law, such rights will extend only to the portions affected. ArcGIS Online has been granted FedRAMP tailored low authorization but does not meet higher security requirements including those found in DFARS 252.239-7010.

B.9.12 Governing Law. This Agreement is not subject to the United Nations Convention on Contracts for the International Sale of Goods.
a. Government Entities. If Customer is a government entity, the applicable laws of Customer's jurisdiction govern this Agreement.
b. Nongovernment Entities. US federal law and the law of the State of California exclusively govern this Agreement, excluding their respective choice of law principles.

B.9.13 Dispute Resolution. The parties will use the following dispute resolution processes:
a. Equitable Relief. Either party will have the right to seek an injunction, specific performance, or other equitable relief in any court of competent jurisdiction without the requirement of posting a bond or proving injury as a condition for relief.
b. US Government Agencies. This Agreement is subject to the Contract Disputes Act of 1978, as amended (41 USC 601–613).
c. Other Government Entities. Esri will comply with mandatory dispute resolutions under applicable law. d. Arbitration. Except as noted above, the parties will submit to binding arbitration to resolve any dispute arising out of or relating to this Agreement that cannot be settled through negotiation. If Customer is in the United States or one of its territories or outlying areas, the Commercial Arbitration Rules of the American Arbitration Association will govern the arbitration proceedings. If Customer is outside the United States, the Rules of Arbitration of the International Chamber of Commerce will govern the proceedings. The parties will select a single arbitrator in accordance with the applicable arbitration rules. The language of the arbitration will be English. Arbitration will be at an agreed-upon location. Either party will, at the request of the other, make available documents or witnesses relevant to the major aspects of the dispute.

B.9.14 Force Majeure. A party will not be liable for any failure of or delay in the performance of this Agreement for the period that such failure or delay is due to causes beyond the party's reasonable control. Such causes may include, but are not limited to, acts of God, war, strikes, labor disputes, cyber attacks, laws, regulations, government orders, or any other force majeure event.

B.9.15 Independent Contractor. Esri is and at all times will be an independent contractor. Nothing in this Agreement creates an employer/employee, principal/agent, or joint venture relationship between Esri or its authorized distributor and Customer. No party has any authority to enter into contracts on behalf of another party or otherwise act on behalf of another party.

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B.9.16 Notice. Customer may send notices required under this Agreement to Esri at the following address:

Environmental Systems Research Institute, Inc.

Attn.: Contracts and Legal Department
380 New York Street
Redlands, CA 92373-8100
USA
Tel.: 909-793-2853
Email: [email protected]

7 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Ray Ramos, Administrative Sergeant
APPROVED BY: City Manager

APPROVE A THREE-YEAR COLLISION REPAIR SERVICE

AGREEMENT WITH ADVANCED AUTO BODY FOR AN AMOUNT NOT
TO EXCEED $173,400

RECOMMENDATION(S)
Authorize the City Manager to execute and administer the Service Agreement with Advanced Auto Body for an amount not to exceed $173,400 for a period of three years.

Advanced Auto Body will furnish collision repair services for the Police Department, Engineering, Utilities, and Community Services' vehicle fleets.

Estimated Time: N/A

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Protecting the Environment and Preserving Open Space and Agricultural Land 2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Economic Blueprint
Public Safety Master Plan
REPORT NARRATIVE:

The Police, Engineering, Utilities, and Community Services Departments collectively maintain a fleet of vehicles. As such, collision repair services are essential for City operations and the safety of our staff and community.

In April 2022, the City of Morgan Hill issued a Request for Proposal (RFP) for collision repair services for the Police, Engineering, Utilities, and Community Services Departments . The City of Morgan Hill received one proposal: Advanced Auto Body, which met the RFP requirements. In response to the RFP, the Police, Engineering, Utilities, and Community Services Departments recommend entering into a new Service Agreement with Advanced Auto Body for a three-year term. Advanced Auto Body has

7 provided collision repair services for the Police Department for over ten (10) years. The Police Department remains extremely satisfied with the services and workmanship provided. City staff is confident Advanced Auto Body will continue to provide a superior level of service under the new Agreement.

Below is an explanation outlining the costs for each year of the 3-year Agreement.

The costs reflected in the proposal submitted by Advanced Auto Body are as follows:

Year 1: Labor Cost per Hour - $110.00 / Non-Dealer Parts Costs 25% Above Wholesale/ Dealer Parts List Price
Year 2: Labor Cost per Hour - $115.00 / Non-Dealer Parts Costs 25% Above Wholesale/ Dealer Parts List Price
Year 3: Labor Cost per Hour - $120.00 / Non-Dealer Parts Costs 25% Above Wholesale/ Dealer Parts List Price
Optional Renewal Period:

Year 4: Labor Cost per Hour - $125.00 / Non-Dealer Parts Costs 25% Above Wholesale/ Dealer Parts List Price
Year 5: Labor Cost per Hour - $125.00 / Non-Dealer Parts Costs 25% Above Wholesale/ Dealer Parts List Price
The Collision Repair Agreement shall not exceed a total amount of $173,400 for the three-year term:
 $110,976 will be allocated to the Police Department and;  $62,424 will be allocated to the Engineering, Utilities, and Community Service Departments.

The Collision Repair Service Agreement will begin on July 1, 2022 and run through June 30, 2025. To maintain operational efficiencies and consistency, at the end of the Agreement's term, the City shall have the option to renew the Agreement for an additional two-year period.

COMMUNITY ENGAGEMENT:

Inform
The RFP was posted on the City’s website for publication. This staff report serves to inform the community of the proposed Agreement between the City of Morgan Hill and Advanced Auto Body for collision repair of vehicles operated by the Police, Engineering, Utilities, and Community Services Departments.

ALTERNATIVE ACTIONS:

The City Council could choose not to approve this Collision Repair Service Agreement and direct staff to issue a new RFP.

7 PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The Police Department currently has a service agreement with Advanced Auto Body signed on June 13, 2017. The agreement was extended for an additional year and expires June 30, 2022.

FISCAL AND RESOURCE IMPACT:

Funds for the Service Agreement for FY 2022-2025 will be allocated from each Department and will be included in the annual budget development process.

CEQA (California Environmental Quality Act):

Not a Project. Continuing administrative or maintenance activities, such as purchases of supplies, personnel-related actions, general policy, and procedure making.

8 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Mario Ramirez, Police Captain
APPROVED BY: City Manager

APPROVE A THREE-YEAR AGREEMENT WITH THE COUNTY OF

SANTA CLARA (SAN MARTIN ANIMAL SHELTER) FOR ANIMAL

SERVICES

RECOMMENDATION(S)
Approve agreement and authorize the City Manager to execute and administer the agreement with the County of Santa Clara (San Martin Animal Shelter) for animal services in the amount of $104,365.65.

Estimated Time: N/A

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Protecting the Environment
Preserving and Cultivating Public Trust
Advancing Regional Initiatives
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Economic Blueprint
Public Safety Master Plan
REPORT NARRATIVE:

In 2018, the Police Department entered into an agreement with Santa Clara County for animal shelter services. As part of the Agreement, the Santa Clara County Animal Shelter provides the following services to the City:

1. Shelter abandoned, lost, or stray domestic animals located within the City's incorporated area.

2. Quarantine of impounded biting domestic animals.

3. Provision to reclaim abandoned, lost, or stray domestic animals during established business hours.

8 4. Euthanasia and disposal of abandoned, lost, impounded, or stray domestic animals unclaimed by their owners and deemed unfit for adoption, rescue, or return to the field.

5. Return-to-field of free-roaming cats after sterilization and vaccination.

6. Veterinarian services during established business hours to treat and provide veterinarian care to stray, injured, or sick dogs, cats, and other impounded domestic animals.

7. Monitor quarantined animals.

8. Access to low-cost or free spay/neuter services as provided to residents of the unincorporated areas of the County of Santa Clara.

Staff recommends continuing our partnership with the Santa Clara County Animal Shelter to provide animal and shelter services to our community.

The County has prepared the attached Agreement for a three-year term, with a not to exceed the amount of $104,365.65. The terms of the contract would be as follows:

July 1, 2022 – June 30, 2023, $ 33,765.46 Due by July 11, 2022 July 1, 2023 – June 30, 2024, $ 34,778.42 Due by July 11, 2023 July 1, 2024 – June 30, 2025, $ 35,821.77 Due by July 11, 2024 COMMUNITY ENGAGEMENT:

This report serves to inform the public of the Agreement between the County (San Martin Animal Shelter) and the City.

ALTERNATIVE ACTIONS:

Council could direct staff to seek and contract with alternative firm(s) to provide the animal shelter services for the City of Morgan HIll.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:
 2015 - City Council approved an appropriation of $5,000 to participate in Santa Clara County's Spay and Neuter Program
 2016 - City Council appropriated $11,00 for the housing of stray or abandoned cat at the San Martin Animal Shelter
 2017 - City Council approved the City's continued participation in Santa Clara County's Spay and Neuter Program and Sheltering services with an annual contribution of $16,000
 2017 - City Council directed staff to explore a regional approach to animal services
 2018 - City Council approved an appropriation of $15,000 in addition to the $16,000 for the sheltering of stray animals, veterinary and spay and neutering services
 2018 - City Council approved a three-year Agreement with Santa Clara County for the sheltering and veterinary treatment of stray animals for an amount not to exceed $92,727

8 FISCAL AND RESOURCE IMPACT:

The total cost for this agreement for three years will be $104,365.65. Sufficient funds have been recommended in the Police Department's operating budget for FY 2022- 2023 and FY 2023-2024. Funding for year three of the agreement will be part of the FY 2024-2025 budget development process.

CEQA (California Environmental Quality Act):

Not a Project. This contract provides organizational or administrative activities of governments that do not result in direct or indirect physical changes in the environment.

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Sheltering Services with
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AGREEMENT BETWEEN THE

COUNTY OF SANTA CLARA AND THE CITY OF MORGAN HILL

FOR ANIMAL SHELTERING SERVICES
The County of Santa Clara (“COUNTY”), and the City of Morgan Hill, a municipal corporation (“CITY”) (together, “PARTIES”) enter into this Agreement Between the County of Santa Clara and the City of Morgan Hill for Animal Sheltering Services (“Agreement”) as of _______________, 2022.

RECITALS
WHEREAS, CITY desires to secure Animal Sheltering Services for domestic animals found within the incorporated area of Morgan Hill, and
WHEREAS, COUNTY has the necessary facilities, expertise and skill to perform those services and COUNTY’s proposal can best meet CITY’s needs, and WHEREAS, CITY and COUNTY have an existing agreement for animal sheltering services which will expire on June 30, 2022;
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:

1. AGREEMENT DOCUMENTS
The documents forming the entire Agreement between CITY and COUNTY shall consist of:

This Agreement;
Exhibit A – Scope of Services; and
Exhibit B – Compensation
If any discrepancies or inconsistencies between the provisions of this Agreement and any of the above-referenced Exhibits arise, the provisions of this Agreement prevail.

This Agreement and the Exhibits set forth above contain all of the agreements, representations, and understandings of the PARTIES hereto, and supersede and replace any previous understanding, commitments, or agreements, whether oral or written.

2. SCOPE OF SERVICES
COUNTY shall perform Animal Sheltering Services and Additional Services as described in the attached Exhibit A, entitled “Scope of Services”.

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3. TERM OF AGREEMENT
This Agreement is effective from July 1, 2022 through June 30, 2025, unless otherwise terminated under Section 5 (TERMINATION) below.

4. COMPENSATION
CITY shall pay COUNTY for the costs of Animal Sheltering Services, and any Additional Services, as applicable, performed under this Agreement. The terms, rate, and schedule of payment are set forth in the attached Exhibit B, entitled "Compensation".

5. TERMINATION

5.1 Termination Without Cause
Either PARTY may terminate this Agreement, without cause, by giving not less than thirty (30) days written notice.

5.2 Termination for Material Breach
Either PARTY may terminate the Agreement in the event of breach of material obligations under this Agreement immediately upon written notice.

5.3 Termination Authority
The Chief of Police of the CITY is empowered to terminate this Agreement on behalf of CITY.

The Director of the COUNTY Consumer Environmental Protection Agency, or authorized designee, may terminate this Agreement on behalf of the COUNTY.

5.4 Consequences of Termination
In the event of termination, COUNTY shall make reasonable and good faith efforts to deliver to CITY records for animals sheltered by COUNTY under this Agreement in a timely manner. COUNTY shall refund the CITY a prorated amount of funds based on the time remaining in the fiscal year.

6. INDEMNIFICATION
CITY shall indemnify, defend, and hold harmless the COUNTY, its officers, agents and employees from any claim, liability, loss, injury or damage arising out of, or in connection with this Agreement by CITY and/or its agents, employees or subcontractors, excepting only loss, injury or damage caused by the sole negligence or willful misconduct of personnel employed by the COUNTY. It is the intent of the Parties to this Agreement to provide the broadest possible coverage for the COUNTY. CITY shall reimburse the COUNTY for all costs, attorneys’ fees, expenses and liabilities incurred with respect to any litigation in which the CITY

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contests its obligation to indemnify, defend and/or hold harmless the COUNTY under this Agreement and does not prevail in that contest.

7. WAIVER
PARTIES agree that waiver of any breach or violation of any provision of this Agreement shall not be deemed to be a waiver of any other provision or a waiver of any subsequent breach or violation of the same or any other provision.

8. INDEPENDENT CONTRACTOR
COUNTY, in the performance of this Agreement, is an independent contractor.

COUNTY shall maintain complete control over all of COUNTY's employees, any subcontracting subcontractors, and COUNTY's operations. Neither COUNTY nor any person retained by COUNTY may represent, act, or purport to act as the agent, representative or employee of CITY. Neither COUNTY nor CITY is granted any right or authority to assume or create any obligation on behalf of the other.

9. COMPLIANCE WITH LAWS
PARTIES shall comply with all applicable laws, ordinances, codes and regulations (collectively, "laws") of the federal, state and local governments, including without limitation, any and all laws specified elsewhere in this Agreement.

10. CONFLICT OF INTEREST
PARTIES shall avoid all conflict of interest or the appearance of conflict of interest in performance of this Agreement.

11. NONDISCRIMINATION
PARTIES agree that it shall not discriminate against, or segregate, any person, on account of race, sex, color, age, religion, sexual orientation, actual or perceived gender identity, disability, ethnicity, national origin, marital status, or family status, in connection with or related to the performance of this Agreement.

12. CONFIDENTIAL INFORMATION
All data, documents, discussions or other information developed or received by or for PARTIES in performance of this Agreement, are confidential and must not be disclosed to any person except as authorized by written consent of the other PARTY, or as required by law.

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13. COUNTY'S RECORDS

13.1 Maintenance during Term
COUNTY shall maintain records, including any ledgers, books of account, invoices, vouchers, canceled checks, and other documents evidencing or relating to charges for services, or expenditures and disbursements charged to CITY for a minimum period of three (3) years, or for any longer period required by law, from the date of final payment to COUNTY pursuant to this Agreement.

13.2 Maintenance after Term
COUNTY shall maintain all documents which demonstrate performance under this Agreement for a minimum period of three (3) years, or for any longer period required by law, from the date of termination or completion of this Agreement.

14. ASSIGNABILITY
The PARTIES agree that COUNTY’s expertise and experience are material considerations for this Agreement. COUNTY may not assign the performance of any obligation or interest under this Agreement, except as authorized under Section 15 (SUBCONTRACTORS) below.

15. SUBCONTRACTORS

15.1 Authorized Subcontractors
Notwithstanding Section 14 (ASSIGNABILITY) above, COUNTY may use subcontractors in performing COUNTY’s services. COUNTY shall be responsible for directing the work of the approved subcontractors and for any compensation due to subcontractors.

16. GOVERNING LAW
This Agreement must be construed, and its performance enforced under California law.

17. VENUE
In the event that either PARTY brings suit, the PARTIES agree that venue is vested in Santa Clara County Superior Court or United States District Court, Northern District of California, San José, California.

18. NOTICE
All notices and other communications required or permitted to be given under this Agreement must be in writing and must be personally served; mailed, postage prepaid via U.S. mail; e-mailed; or sent via courier service, addressed to the respective parties as follows:

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CITY: Shane Palsgrove, Chief of Police
16200 Vineyard Boulevard
Morgan Hill, CA 95037
[email protected]
And
City Clerk, City of Morgan Hill
17575 Peak Avenue
Morgan Hill, CA 95037
COUNTY: Lisa Jenkins- Program Manager
County of Santa Clara Animal Services
12425 Monterey Rd.

San Martin, CA 95046
[email protected]
Notice will be effective on the date personally delivered or if sent by courier service, on the date of receipt. If mailed, notice will be effective three (3) days after deposit in the mail. The PARTIES may change their respective addresses in accordance with the provisions of this Section.

19. MISCELLANEOUS

19.1 Survival of Provisions
If any part of this Agreement is for any reason found to be unenforceable, all other parts nevertheless shall remain enforceable.

19.2 Assignment
Subject to the provisions of Section 14 (ASSIGNABILITY), this Agreement binds and inures to the benefit of the PARTIES and their respective successors and assigns.

19.3 Headings
The headings of the sections of this Agreement are inserted for convenience only. They do not constitute part of this Agreement and are not to be used in its construction.

20. CONTRACT EXECUTION
Unless otherwise prohibited by law or COUNTY policy, the parties agree that an electronic copy of a signed contract, or an electronically signed contract, has the same force and legal effect as a contract executed with an original ink signature. The term “electronic copy of a signed contract” refers to a transmission by facsimile, electronic mail, or other electronic means of a copy of an original signed contract in a portable document format. The term “electronically signed contract” means a contract that is

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executed by applying an electronic signature using technology approved by the COUNTY.

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WITNESS THE EXECUTION HEREOF on the day and year first written above.

CITY OF MORGAN HILL
APPROVED AS TO FORM:

By: _________________________

DONALD LARKIN
City Attorney
City of Morgan Hill
Date: _________________________
CITY OF MORGAN HILL, a municipal
corporation
By: _________________________
CHRISTINA J. TURNER
City Manager,
City of Morgan Hill
Date: _________________________

COUNTY OF SANTA CLARA
APPROVED:

By: _________________________

GENE CLARK
Chief Procurement Officer
Date: _________________________
By: _________________________

JO ZIENTEK
Director, Consumer and
Environmental Protection Agency
Date: _________________________
APPROVED AS TO FORM AND LEGALITY:

By: _________________________
Willie Nguyen
Deputy County Counsel
Date: _________________________

A-2

EXHIBIT A

SCOPE OF SERVICES
Animal Sheltering Services
COUNTY shall provide the following services (referred to, collectively, as “Animal Sheltering Services”):

1. Sheltering of abandoned, lost or stray domestic animals found in the incorporated area of the CITY;

2. Quarantine of impounded biting domestic animals;

3. Provision for reclaim of abandoned, lost or stray domestic animals during established business hours;

4. Euthanasia and disposal of abandoned, lost, impounded, or stray domestic animals that are unclaimed by their owners and are deemed unfit for adoption, rescue or return-to-field;

5. Return-to-field of free-roaming cats after sterilization and vaccination;

6. Veterinarian services during established business hours to treat and provide veterinarian care to stray, injured, or sick dogs, cats, and other impounded domestic animals;

7. Monitor quarantined animals; and

8. Access to low-cost or free spay/neuter services as provided to residents of the unincorporated areas of the County of Santa Clara.

Owner-relinquished animals and confiscated animals will be accepted on approval of the Manager after considering shelter population, space available, and costs.

COUNTY shall provide sheltering and veterinary care of domestic animals at the County of Santa Clara Animal Services Center located at 12425 Monterey Highway in San Martin during normally staffed hours, which are Monday through Friday from 8:00 am through 6:00 pm and Saturday and Sunday from 8:00 am through 5:00 pm. Services will not be available on COUNTY holidays, however, CITY will have access to “night drop” kennels based on availability. Only dogs that appear to be free of injury may be left in the “night drop” kennels by authorized CITY staff. Dogs that are not bright, alert and active, have open wounds, broken limbs or have been hit by a car must be taken to an emergency veterinarian at the CITY’S expense, but may be transported to the

A-2
shelter by the CITY during operational hours for continued care. Cats and other animals cannot be left in night-drop kennels.

Animals taken into custody by CITY that are to be impounded by COUNTY are to be transported promptly and humanely, and shall be made available for owner redemption as required by law. Animals requiring a quarantine hold will be made available following the quarantine period. Whenever an animal is impounded with identification, COUNTY will make reasonable attempt to notify owners of the animal’s impoundment. Where the CITY requests that an animal not be made available for reclamation, adoption, rescue, or return-to-field, such request must be approved by the COUNTY’s Animal Control Program Manager prior to impoundment. COUNTY will require an address (in the case of cats) or a street and cross street (in the case of all other animals) where each animal was found from both CITY and its residents, prior to accepting an animal for impound.

COUNTY may collect fees from the public in connection with a portion of the Animal Sheltering Services provided under this Agreement and as consistent with the County Ordinance Code, including but not limited to impound, boarding, and quarantine fees.

These fees shall be at the rates established by COUNTY.

Additional Services

1. Dead Animal Removal
At CITY’s request and subject to the availability of COUNTY resources to provide such service, COUNTY shall provide removal of deceased animals from public property in the incorporated areas of CITY for disposal at a rate of $70 for each pick-up. A pick-up shall be a single animal weighing not more than 100 pounds and where specialized equipment is not necessary to pick up and remove the animal. COUNTY will provide CITY with an accounting of pick-up activity for reimbursement on a monthly basis.

COUNTY shall make reasonable efforts to remove deceased animals in a timely fashion, with a goal of removal within 48 hours of receipt of the request. CITY shall give COUNTY 30 days’ written notice to commence or terminate this additional service.

EXHIBIT B

COMPENSATION
Invoicing and Payment
Animal Sheltering Services
CITY shall pay COUNTY for the costs of the Animal Sheltering Services provided by COUNTY to the CITY under this Agreement for the period of July 1, 2022 through June 30, 2025 at the following rate and on the following schedule:

Service Period Rate Payment Schedule
July 1, 2022 - June 30, 2023 $33,765.46 Due July 11, 2022 July 1, 2023 - June 30, 2024 $34,778.42 Due July 11, 2023 July 1, 2024 – June 30, 2025 $35,821.77 Due July 11, 2024 Additional Services
CITY shall pay COUNTY for the costs of dead animal removal at a rate of $70 for each pick-up. COUNTY will provide CITY with a monthly invoice for all dead animal removal services performed during that period. Payment is due within 30 days of receipt of the invoice. A 3% increase will apply for every 30 days of delinquent payment.

9 CITY COUNCIL STAFF REPORT
MEETING DATE: June 15, 2022
PREPARED BY:

Mario Ramirez, Police Captain
APPROVED BY: City Manager

APPROVE A TEN-YEAR AGREEMENT WITH AXON FOR VARIOUS

POLICE DEPARTMENT EQUIPMENT AND RELATED SERVICES IN
THE AMOUNT OF $1,710,607

RECOMMENDATION(S)

1. Approve a 10-year agreement with Axon for the Officer Safety Plan 7 (OSP7) and Fleet 3; and

2. Authorize the City Manager to execute and amend, when necessary, a 10-year agreement with Axon for the Officer Safety Plan 7 and Fleet 3.

Estimated Time:

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Maintaining and Enhancing Infrastructure
Advancing Regional Initiatives
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Public Safety Master Plan
REPORT NARRATIVE:

BACKGROUND
The Police Department has an agreement with Axon to purchase individual equipment such as Tasers, Taser Cartridges, body-worn cameras, docking stations, and limited cloud storage for body-worn camera videos. The Department has accumulated several generations of Tasers and body-worn cameras over the years and replaces them as they become inoperable. This is leading to unsafe and unreliable equipment for officers and community members and inefficient use of staff time addressing equipment failures.

9 The Police Department currently has two existing Axon contracts (body-worn cameras and tasers that are expired and need to be renegotiated). The Police Department’s current tasers are out of warranty and at the end of their useful life. Staff has regularly ordered parts to maintain their functionality, and Axon will no longer support the product (Taser Model X26P).

Staff recommends approving a sole-source purchase because the materials manufactured and distributed by Axon are unique and specialized, and there is no other source for this equipment.

The execution of the proposed contract will extend and bundle existing contracts and add new technology that will increase safety and improve staff efficiency. The single service contract will also provide more budget predictability and reduce staff time spent on ordering and replacing equipment over the contract term. In addition, the single proposed contract leases equipment and replaces it every 3 years with Axon’s newest model. There are no other vendors capable of meeting the requirements of this service or product. Furthermore, Axon is not imposing any penalties for restructuring the existing contracts and entering into a new 10-year contract for all services under its Officer Safety Plan 7 (OSP7), bundling of Tasers and bond-worn cameras.

The total amount previously budgeted for all Axon products was $52,875. This total cost represented body-worn cameras, video storage, and taser replacement during failures or warranty needs. Moreover, video storage is not unlimited storage and costs $4.80 a month for every 10GB of storage we exceed over our current storage allotment. The current agreement before the Council offers the following enhanced services and equipment:

1. Taser Energy Weapon (newest model currently Taser Model 7)

2. Unlimited Axon Evidence (cloud storage)

3. Taser Docking stations

4. Training Cartridges (1,000 training cartridges)

5. Duty Cartridges (Unlimited)

6. Axon Body Camera (newest model, currently model 3)

7. Camera Hardware upgrades every 2.5 years

8. Axon Signal Sidearm (sensors that automatically turn on body-worn cameras for all officers within a 30-foot radius when a firearm is removed from a holster)

9. Axon Video Viewer License

10. Axon Response for Devices (Live feed video access and GPS monitoring from computers/cell phones)

11. Axon Records Licenses

12. Auto-Tagging (Imports call for service metadata for each video, reducing officer time in adding the data to each video)

13. Axon Performance (Management of camera usage analytics)

14. Axon Redaction Assistant (The ability to redact video footage, such as blurring faces and addresses and muting personal information during a video that may be

9 released to the public.)

15. Axon Citizen for Communities (The ability to provide community members a link to upload home video surveillance directly to Evidence.com)

16. Axon Auto Transcribe (transcription of videos)

17. Fleet 3 (in-car camera system)
FLEET 3:

In addition to the OSP 7 Plan, Axon has an in-car camera system called Fleet 3. Staff has included this in the service contract to expand video coverage of pursuits, collisions, and vehicle stops. This will be the first in-car camera system the police department deploys. The camera system consists of a forward-facing camera and a rear-facing passenger compartment camera. The rear-facing camera records passengers in the back seat being transported. Fleet 3 utilizes Axon Signal, which activates the vehicle’s cameras and all body-worn cameras within a 30-foot radius when the emergency lighting equipment is turned on. The Fleet 3 plan would outfit each patrol vehicle in our fleet with an in-car camera system.

The new OSP7 plan and Fleet 3 agreement will increase the Police Department's Axon cost from $52,875 a year to $171,061. The increase in the cost is reflected in the increase in equipment and released services, such as unlimited cloud, duty cartridges, camera hardware upgrades, signal sidearm, Axon video viewer, Axon response for devices, Axon recods lisences, Axon perfromane, Asxon redaction assistant, Axon citzen, Axon auto transcribe and Fleet 3. In addition, the proposed agreement will replace all of our existing body cameras and Tasres, and will replace them with Axon's body camera 3 and Taser 7, the newest model for both devices. With the OPS 7 Plan, the Police Department will receive all equipment and related services outlined above in the staff report. Axon anticipates a cost increase of approximately 4% per year for individual contract services. Entering into this agreement ensures that our Police Department will be locked in at the current price for ten years. Through the OSP 7 plan, the department is saving and receiving a 25% discount on all the equipment and a 50% discount on data storage.

Axon estimates that by bundling the products (OSP7 and Fleet 3), there will be a savings of $555,023 over the ten-year contract, as opposed to purchasing each product individually. Moreover, there is an additional savings of $23,160 each year for the CAD/RMS integration.

Axon is a sole source vendor, as it is the only company that manufactures Tasers and is the only company that has integrated Tasers, body-worn cameras, and in-car camera system (Fleet 3) with the rest of their technological platform. The majority of this contract is extending or renegotiating existing contracts for support of equipment the City has already purchased.

Staff believes that by utilizing Axon OSP7 and Fleet 3, the Police Department will be able to increase officer and community safety, reduce staff time spent on repairs/replacements/agreements, reduce city liability, and keep up with technology

9 advancements while experiencing cost savings over the 10-year term.

COMMUNITY ENGAGEMENT:

This staff report serves to inform the community of the City’s desire to enter into a 10- year Agreement with Axon for the Officer Safety Plan 7 and Fleet 3 integration.

ALTERNATIVE ACTIONS:

Should the Council not approve this agreement, the Police Department would need to purchase additional Tasers and body-worn cameras under Axon's à la carte options to maintain current equipment.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

Council has approved multiple purchase contracts with Axon for police equipment, such as Tasers, body worn cameras, cloud storage, and the police CAD/RMS upgrade.

FISCAL AND RESOURCE IMPACT:

The total yearly cost for OPS7 and Fleet 3 is $171,061. Sufficient funds have been included in the Police Department's Recommended Budget for FY 2022-2023 and FY 2023-2024. Continued funding for the life of the contract will be part of all future budget development process.

CEQA (California Environmental Quality Act):

Not a Project. This contract provides organizational or administrative activities of governments that do not result in direct or indirect physical changes in the environment.

1 Q-378445-44680.681TR
Q-378445-44680.681TR
Issued: 04/29/2022
Quote Expiration: 06/24/2022
EST Contract Start Date: 12/01/2023
Account Number: 107493
Payment Terms: N30
Delivery Method: Fedex - Ground

SHIP TO BILL TO SALES REPRESENTATIVE PRIMARY CONTACT
Business;Delivery;Invoice-16200
Vineyard Blvd
Morgan Hill Police Department - CA Thom Ruseva-Mahan Mario Ramirez 16200 Vineyard Blvd 16200 Vineyard Blvd Phone: +1 4804148450 Phone: (408) 779-2101 Morgan Hill, CA 95037-7164 Morgan Hill, CA 95037-7164 Email: [email protected] Email:
[email protected]
USA USA Fax: +1 4809993359 Fax:

Email:

Program Length 120 Months Bundle Savings $14,504.80
TOTAL COST $238,009.48 Additional Savings $7,361.12
ESTIMATED TOTAL W/ TAX $246,926.04 TOTAL SAVINGS $21,865.92

PAYMENT PLAN

PLAN NAME INVOICE DATE TAX AMOUNT AMOUNT DUE
Year 1 Nov, 2023 $891.62 $24,692.55
Year 2 Nov, 2024 $891.66 $24,692.61
Year 3 Nov, 2025 $891.66 $24,692.61
Year 4 Nov, 2026 $891.66 $24,692.61
Year 5 Nov, 2027 $891.66 $24,692.61
Year 6 Nov, 2028 $891.66 $24,692.61
Axon Enterprise, Inc.
17800 N 85th St.

Scottsdale, Arizona 85255
United States
VAT: 86-0741227
Domestic: (800) 978-2737
International: +1.800.978.2737

2 Q-378445-44680.681TR
Year 7 Nov, 2029 $891.66 $24,692.61
Year 8 Nov, 2030 $891.66 $24,692.61
Year 9 Nov, 2031 $891.66 $24,692.61
Year 10 Nov, 2032 $891.66 $24,692.61
Quote Details
Bundle Summary
Item Description QTY
DynamicBundle Dynamic Bundle 1
Fleet3B10Yr Fleet 3 Basic 10 Year 20
Bundle: Dynamic Bundle Quantity: 1 Start: 12/1/2023 End: 11/30/2033 Total: 18.6 USD Category Item Description QTY List Price Discount Tax Net Price Total(USD) Other 71210 FLEET DOOR TRIGGER HARDWARE, US 1 $18.60 0.00% $1.68 $18.60 $18.60 Bundle: Fleet 3 Basic 10 Year Quantity: 20 Start: 12/1/2023 End: 11/30/2033 Total: 237990.88 USD Category Item Description QTY List Price Discount Tax Net Price Total(USD) Storage 80410 FLEET, UNLIMITED STORAGE, 1 CAMERA 40 $17.00 14.60% $0.00 $14.52 $69,684.10 E.com License 80400 FLEET, VEHICLE LICENSE 20 $20.00 5.58% $0.00 $18.88 $45,320.72 Camera Kit & Warranty 72036 FLEET 3 STANDARD 2 CAMERA KIT 20 $2,405.00 5.58% $4,144.1 5 $2,270.76 $45,415.13
SIM 72034 FLEET SIM INSERTION, VZW 20 $15.00 5.58% $25.85 $14.16 $283.25 Router 11634 CRADLEPOINT IBR900-1200M-B-NPS+5YR
NETCLOUD 20 $1,249.00 5.58% $2,152.1
9 $1,179.28 $23,585.66
Router Antenna 71200 FLEET ANT, AIRGAIN, 5-IN-1, 2LTE, 2WIFI, 1GNSS, BL 20 $249.00 5.58% $429.07 $235.10 $4,702.02
Vehicle Installation 73391 FLEET 3 NEW INSTALLATION (PER VEHICLE) 20 $1,200.00 5.58% $0.00 $1,133.02 $22,660.36
Axon Signal Unit 70112 AXON SIGNAL UNIT 20 $279.00 5.58% $480.76 $263.43 $5,268.53 Other 80495 EXT WARRANTY, FLEET 3, 2 CAMERA KIT 20 $8.96 5.58% $1,682.8 6 $8.46 $18,442.51
Other 80379 EXT WARRANTY, AXON SIGNAL UNIT 20 $1.16 5.58% $0.00 $1.10 $2,628.60

3 Q-378445-44680.681TR

INDIVIDUAL ITEMS
Category Item Description QTY List Price Discount Tax Net Price Total(USD) Total: 0
Tax is estimated based on rates applicable at date of quote and subject to change at time of invoicing. If a tax exemption certificate should be applied, please submit prior to invoicing.

4 Q-378445-44680.681TR
Standard Terms and Conditions
Axon Enterprise Inc. Sales Terms and Conditions
Axon Master Services and Purchasing Agreement:

This Quote is limited to and conditional upon your acceptance of the provisions set forth herein and Axon’s Master Services and Purchasing Agreement (posted at www.axon.com/legal/sales-terms-and-conditions), as well as the attached Statement of Work (SOW) for Axon Fleet and/or Axon Interview Room purchase, if applicable. In the event you and Axon have entered into a prior agreement to govern all future purchases, that agreement shall govern to the extent it includes the products and services being purchased and does not conflict with the Axon Customer Experience Improvement Program Appendix as described below.

ACEIP:

The Axon Customer Experience Improvement Program Appendix, which includes the sharing of de-identified segments of Agency Content with Axon to develop new products and improve your product experience (posted at www.axon.com/legal/sales-terms-and-conditions), is incorporated herein by reference. By signing below, you agree to the terms of the Axon Customer Experience Improvement Program.

Acceptance of Terms:

Any purchase order issued in response to this Quote is subject solely to the above referenced terms and conditions. By signing below, you represent that you are lawfully able to enter into contracts. If you are signing on behalf of an entity (including but not limited to the company, municipality, or government agency for whom you work), you represent to Axon that you have legal authority to bind that entity. If you do not have this authority, please do not sign this Quote.

5 Q-378445-44680.681TR
\s1\ \d1\
Signature Date Signed
4/29/2022

1 FLEET STATEMENT OF WORK BETWEEN AXON ENTERPRISE AND AGENCY Introduction
This Statement of Work (“SOW”) has been made and entered into by and between Axon Enterprise, Inc. (“AXON”), and Morgan Hill Police Department - CA the (“AGENCY”) for the purchase of the Axon Fleet in-car video solution (“FLEET”) and its supporting information, services and training. (AXON Technical Project Manager/The AXON installer)
Purpose and Intent
AGENCY states, and AXON understands and agrees, that Agency’s purpose and intent for entering into this SOW is for the AGENCY to obtain from AXON deliverables, which used solely in conjunction with AGENCY’s existing systems and equipment, which AGENCY specifically agrees to purchase or provide pursuant to the terms of this SOW.

This SOW contains the entire agreement between the parties. There are no promises, agreements, conditions, inducements, warranties or understandings, written or oral, expressed or implied, between the parties, other than as set forth or referenced in the SOW.

Acceptance
Upon completion of the services outlined in this SOW, AGENCY will be provided a professional services acceptance form (“Acceptance Form”). AGENCY will sign the Acceptance Form acknowledging that services have been completed in substantial conformance with this SOW and the Agreement. If AGENCY reasonably believes AXON did not complete the professional services in conformance with this SOW, AGENCY must notify AXON in writing of the specific reasons within seven (7) calendar days from delivery of the Acceptance Form. AXON will remedy the issues to conform with this SOW and re-present the Acceptance Form for signature. If AXON does not receive the signed Acceptance Form or written notification of the reasons for rejection within 7 calendar days of the delivery of the Acceptance Form, AGENCY will be deemed to have accepted the services in accordance to this SOW.

Force Majeure

2 Neither party hereto shall be liable for delays or failure to perform with respect to this SOW due to causes beyond the party’s reasonable control and not avoidable by diligence.

Schedule Change
Each party shall notify the other as soon as possible regarding any changes to agreed upon dates and times of Axon Fleet in-car Solution installation to be performed pursuant of this Statement of Work.

Axon Fleet Deliverables
Typically, within (30) days of receiving this fully executed SOW, an AXON Technical Project Manager will deliver to AGENCY’s primary point of contact via electronic media, controlled documentation, guides, instructions and videos followed by available dates for the initial project review and customer readiness validation. Unless otherwise agreed upon by AXON, AGENCY may print and reproduce said documents for use by its employees only.

Security Clearance and Access
Upon AGENCY’s request, AXON will provide the AGENCY a list of AXON employees, agents, installers or representatives which require access to the AGENCY’s facilities in order to perform Work pursuant of this Statement of Work. AXON will ensure that each employee, agent or representative has been informed or and consented to a criminal background investigation by AGENCY for the purposes of being allowed access to AGENCY‘s facilities. AGENCY is responsible for providing AXON with all required instructions and documentation accompanying the security background check’s requirements.

Training
AXON will provide training applicable to Axon Evidence, Cradlepoint NetCloud Manager and Axon Fleet application in a train-the-trainer style method unless otherwise agreed upon between the AGENCY and AXON.

Local Computer

3 AGNECY is responsible for providing a mobile data computer (MDC) with the same software, hardware, and configuration that AGENCY personnel will use with the AXON system being installed. AGENCY is responsible for making certain that any and all security settings (port openings, firewall settings, antivirus software, virtual private network, routing, etc.) are made prior to the installation, configuration and testing of the aforementioned deliverables.

Network
AGENCY is responsible for making certain that any and all network(s) route traffic to appropriate endpoints and AXON is not liable for network breach, data interception, or loss of data due to misconfigured firewall settings or virus infection, except to the extent that such virus or infection is caused, in whole or in part, by defects in the deliverables.

Cradlepoint Router
When applicable, AGENCY must provide AXON Installers with temporary administrative access to Cradlepoint’s NetCloud Manager to the extent necessary to perform Work pursuant of this Statement of Work.

Evidence.com
AGENCY must provide AXON Installers with temporary administrative access to Axon Evidence.com to the extent necessary to perform Work pursuant of this SOW.

Wireless Upload System
If purchased by the AGENCY, on such dates and times mutually agreed upon by the parties, AXON will install and configure into AGENCY’s existing network a wireless network infrastructure as identified in the AGENCY’s binding quote based on conditions of the sale.

VEHICLE INSTALLATION
Preparedness

4 On such dates and times mutually agreed upon by the parties, the AGENCY will deliver all vehicles to an AXON Installer less weapons and items of evidence.

Vehicle(s) will be deemed ‘out of service’ to the extent necessary to perform Work pursuant of this SOW.

Existing Mobile Video Camera System Removal
On such dates and times mutually agreed upon by the parties, the AGENCY will deliver all vehicles to an AXON Installer which will remove from said vehicles all components of the existing mobile video camera system unless otherwise agreed upon by the AGENCY.

Major components will be salvaged by the AXON Installer for auction by the AGENCY. Wires and cables are not considered expendable and will not be salvaged. Salvaged components will be placed in a designated area by the AGENCY within close proximity of the vehicle in an accessible work space.

Prior to removing the existing mobile video camera systems, it is both the responsibility of the AGENCY and the AXON Installer to test the vehicle’s systems’ operation to identify and operate, documenting any existing component or system failures and in detail, identify which components of the existing mobile video camera system will be removed by the AXON Installer.

In-Car Hardware/Software Delivery and Installation
On such dates and times mutually agreed upon by the parties, the AGENCY will deliver all vehicles to an AXON Installer, who will install and configure in each vehicle in accordance with the specifications detailed in the system’s installation manual and its relevant addendum(s). Applicable in-car hardware will be installed and configured as defined and validated by the AGENCY during the pre-deployment discovery process.

If a specified vehicle is unavailable on the date and time agreed upon by the parties, AGENCY will provide a similar vehicle for the installation process. Delays due to a vehicle, or substitute vehicle, not being available at agreed upon dates and times may results in additional fees to the AGENCY. If the AXON Installer determines that a vehicle is not properly prepared for installation (“Not Fleet Ready”), such as a battery not being properly charged or properly up-fit for in-service, field operations, the issue shall be reported immediately to the AGENCY for resolution and a date and time for the future installation shall be agreed upon by the parties.

5 Upon completion of installation and configuration, AXON will systematically test all installed and configured in-car hardware and software to ensure that ALL functions of the hardware and software are fully operational and that any deficiencies are corrected unless otherwise agreed upon by the AGENCY, installation, configuration, test and the correct of any deficiencies will be completed in each vehicle accepted for installation.

Prior to installing the Axon Fleet camera systems, it is both the responsibility of the AGENCY and the AXON Installer to test the vehicle’s existing systems’ operation to identify, document any existing component or vehicle systems’ failures. Prior to any vehicle up-fitting the AXON Installer will introduce the system’s components, basic functions, integrations and systems overview along with reference to AXON approved, AGENCY manuals, guides, portals and videos. It is both the responsibility of the AGENCY and the AXON Installer to agree on placement of each components, the antenna(s), integration recording trigger sources and customer preferred power, ground and ignition sources prior to permanent or temporary installation of an Axon Fleet camera solution in each vehicle type.

Agreed placement will be documented by the AXON Installer.

AXON welcomes up to 5 persons per system operation training session per day, and unless otherwise agreed upon by the AGENCY, the first vehicle will be used for an installation training demonstration. The second vehicle will be used for an assisted installation training demonstration. The installation training session is customary to any AXON Fleet installation service regardless of who performs the continued Axon Fleet system installations.

6 The customary training session does not ‘certify’ a non-AXON Installer, customer-employed Installer or customer 3rd party Installer, since the AXON Fleet products does not offer an Installer certification program. Any work performed by non-AXON Installer, customer-employed Installer or customer 3rd party Installer is not warrantied by AXON, and AXON is not liable for any damage to the vehicle and its existing systems and AXON Fleet hardware.

1 Q-370070-44700.671TR
Q-370070-44700.671TR
Issued: 05/19/2022
Quote Expiration: 06/24/2022
EST Contract Start Date: 08/01/2022
Account Number: 107493
Payment Terms: N30
Delivery Method: Fedex - Ground

SHIP TO BILL TO SALES REPRESENTATIVE PRIMARY CONTACT
Business;Delivery;Invoice-16200
Vineyard Blvd
Morgan Hill Police Department - CA Thom Ruseva-Mahan Mario Ramirez 16200 Vineyard Blvd 16200 Vineyard Blvd Phone: +1 4804148450 Phone: (408) 779-2101 Morgan Hill, CA 95037-7164 Morgan Hill, CA 95037-7164 Email: [email protected] Email:
[email protected]
USA USA Fax: +1 4809993359 Fax:

Email:

Program Length 120 Months Bundle Savings $433,549.84
TOTAL COST $1,412,837.36 Additional Savings $99,607.00
ESTIMATED TOTAL W/ TAX $1,463,681.05 TOTAL SAVINGS $533,156.84

PAYMENT PLAN

PLAN NAME INVOICE DATE TAX AMOUNT AMOUNT DUE
Year 1 Jul, 2022 $5,084.37 $146,368.07
Year 2 Jul, 2023 $5,084.37 $146,368.11
Year 3 Jul, 2024 $5,084.37 $146,368.11
Year 4 Jul, 2025 $5,084.37 $146,368.11
Year 5 Jul, 2026 $5,084.37 $146,368.11
Year 6 Jul, 2027 $5,084.37 $146,368.11
Axon Enterprise, Inc.
17800 N 85th St.

Scottsdale, Arizona 85255
United States
VAT: 86-0741227
Domestic: (800) 978-2737
International: +1.800.978.2737

2 Q-370070-44700.671TR
Year 7 Jul, 2028 $5,084.37 $146,368.11
Year 8 Jul, 2029 $5,084.37 $146,368.11
Year 9 Jul, 2030 $5,084.37 $146,368.11
Year 10 Jul, 2031 $5,084.37 $146,368.11
Quote Details
Bundle Summary
Item Description QTY
OSP7+10Year 2021 - OFFICER SAFETY PLAN 7 PLUS 10 Year 50 AB3C AB3 Camera Bundle 50
AB3MBD AB3 Multi Bay Dock Bundle 7
ProLicense Pro License Bundle 7
Bundle: AB3 Camera Bundle Quantity: 50 Start: 8/1/2022 End: 7/31/2032 Total: 0 USD Category Item Description QTY List Price Discount Tax Net Price Total(USD) Camera 73202 AXON BODY 3 - NA10 - US - BLK -
RAPIDLOCK 50 $699.00 100.00% $0.00 $0.00 $0.00
Spare Camera 73202 AXON BODY 3 - NA10 - US - BLK -
RAPIDLOCK 1 $0.00 0.00% $0.00 $0.00 $0.00
Camera Mount 74020 MAGNET MOUNT, FLEXIBLE, AXON
RAPIDLOCK 55 $0.00 0.00% $0.00 $0.00 $0.00
USB 11534 USB-C to USB-A CABLE FOR AB3 OR FLEX 2 55 $0.00 0.00% $0.00 $0.00 $0.00 Bundle: AB3 Multi Bay Dock Bundle Quantity: 7 Start: 8/1/2022 End: 7/31/2032 Total: 0 USD Category Item Description QTY List Price Discount Tax Net Price Total(USD) Dock 74210 AXON BODY 3 - 8 BAY DOCK 7 $1,495.00 100.00% $0.00 $0.00 $0.00 Power Cord 71019 NORTH AMER POWER CORD FOR AB3 8-
BAY, AB2 1-BAY / 6-BAY DOCK 7 $0.00 0.00% $0.00 $0.00 $0.00

3 Q-370070-44700.671TR
Bundle: Pro License Bundle Quantity: 7 Start: 8/1/2022 End: 7/31/2032 Total: 34297.2 USD Category Item Description QTY List Price Discount Tax Net Price Total(USD) E.com License 73746 PROFESSIONAL EVIDENCE.COM LICENSE 7 $39.00 -4.69% $0.00 $40.83 $34,297.20 A La Carte Storage 73683 10 GB EVIDENCE.COM A-LA-CART
STORAGE- 21 $0.00 0.00% $0.00 $0.00 $0.00
Bundle: 2021 - OFFICER SAFETY PLAN 7 PLUS 10 Year Quantity: 50 Start: 8/1/2022 End: 7/31/2032 Total: 1262140.16 USD Category Item Description QTY List Price Discount Tax Net Price Total(USD) E.com License 73746 PROFESSIONAL EVIDENCE.COM LICENSE 50 $39.00 29.38% $0.00 $27.54 $165,255.50 Device Storage 73686 UNLIMITED BWC + CAPTURE STORAGE 50 $24.00 52.74% $0.00 $11.34 $68,058.00 A La Carte Storage 73683 10 GB EVIDENCE.COM A-LA-CART
STORAGE- 500 $0.40 24.90% $0.00 $0.30 $18,025.00
Respond Plus 73680 RESPOND DEVICE PLUS LICENSE 50 $19.00 24.89% $0.00 $14.27 $85,622.50 Records 73681 AXON RECORDS FULL 50 $29.00 24.89% $0.00 $21.78 $130,686.50 Citizen 73618 CITIZEN FOR COMMUNITIES USER
LICENSE 50 $9.00 24.89% $0.00 $6.76 $40,558.00
Redaction 73478 REDACTION ASSISTANT USER LICENSE 50 $9.00 24.89% $0.00 $6.76 $40,558.00 Performance 73739 PERFORMANCE LICENSE 50 $9.00 24.89% $0.00 $6.76 $40,558.00 Auto Tagging 73682 AUTO TAGGING LICENSE 50 $9.00 24.89% $0.00 $6.76 $40,558.00 3rd Party Video 11642 THIRD-PARTY VIDEO SUPPORT LICENSE 50 $9.00 24.89% $3,700.9 3 $6.76 $40,558.00
Active Channel 80225 ACTIVE CHANNEL LICENSE 1 $5,000.00 24.89% $0.00 $3,755.37 $37,553.66 E.com Channel 80190 Evidence.com Channel Services 1 $5,000.00 24.89% $0.00 $3,755.37 $3,755.37 Auto Tagging
Implementation 79999 AUTO TAGGING / PERFORMANCEIMPLEMENTATION SERVICE 1 $0.00 0.00% $0.00 $0.00 $0.00 Signal Sidearm Kit 75015 SIGNAL SIDEARM KIT 50 $249.00 24.89% $853.28 $187.02 $9,351.00 Signal Sidearm Batteries 71044 BATTERY, SIGNAL SIDEARM, CR2430 SINGLE PACK 100 $1.00 25.00% $6.83 $0.75 $75.00
Camera Warranty 80464 EXT WARRANTY, CAMERA (TAP) 50 $11.67 24.89% $4,358.9 7 $8.77 $47,769.50
Camera Refresh 1 with
Spares 73309 AXON CAMERA REFRESH ONE 51 $755.00 24.89% $2,638.9 5 $567.06 $28,920.06
Camera Refresh 2 with
Spares 73310 AXON CAMERA REFRESH TWO 51 $790.00 24.89% $2,761.2 7 $593.35 $30,260.85
Camera Refresh 3 with
Spares 73345 AXON CAMERA REFRESH THREE 51 $825.00 24.89% $2,883.6 5 $619.64 $31,601.64
Camera Refresh 4 with
Spares 73346 AXON CAMERA REFRESH FOUR 51 $860.00 24.89% $3,005.9 5 $645.92 $32,941.92
Multi Bay Warranty 80465 EXT WARRANTY, MULTI-BAY DOCK (TAP) 7 $21.00 24.89% $1,098.1 $15.77 $12,034.47

4 Q-370070-44700.671TR 3
Multi-bay Dock Refresh 1
73689 MULTI-BAY BWC DOCK 1ST REFRESH7 $1,610.00 24.89% $772.39 $1,209.23 $8,464.61 Multi-bay Dock Refresh 2
73688 MULTI-BAY BWC DOCK 2ND REFRESH7 $1,685.00 24.89% $808.35 $1,265.56 $8,858.92 Inactive Channel 80223 INACTIVE CHANNEL ACCESS LICENSE1 $5,000.00 24.89% $0.00 $3,755.37 $3,755.37 Multi-bay Dock Refresh 3
73347 MULTI-BAY BWC DOCK 3RD REFRESH7 $1,760.00 24.89% $844.38 $1,321.89 $9,253.23 Multi-bay Dock Refresh 4
73348 MULTI-BAY BWC DOCK 4TH REFRESH7 $1,840.00 24.89% $882.73 $1,381.97 $9,673.79 Spare Camera Warranty 80464 EXT WARRANTY, CAMERA (TAP)1 $11.67 24.89% $87.17 $8.77 $955.39 Handle License 20248 TASER7 EVIDENCE.COM LICENSE 50 $5.00 24.89% $0.00 $3.76 $22,532.00 Battery& Warranty
Bundle 20018 TASER
7 BATTERY PACK, TACTICAL 60 $90.56 24.89% $372.42 $68.02 $4,081.20 Master Instructor Course
Vouchers 20119 TASER
7 MASTER INSTRUCTOR SCHOOL

VOUCHER
1 $1,495.00 24.89% $0.00 $1,122.85 $1,122.85
Master Instructor Course
Vouchers 20119 TASER
7 MASTER INSTRUCTOR SCHOOL

VOUCHER
1 $1,495.00 24.89% $0.00 $1,122.85 $1,122.85
Master Instructor Course
Vouchers 20119 TASER
7 MASTER INSTRUCTOR SCHOOL

VOUCHER
1 $1,495.00 24.89% $0.00 $1,122.85 $1,122.85
Master Instructor Course
Vouchers 20119 TASER
7 MASTER INSTRUCTOR SCHOOL

VOUCHER
1 $1,495.00 24.89% $0.00 $1,122.85 $1,122.85
Master Instructor Course
Vouchers 20119 TASER
7 MASTER INSTRUCTOR SCHOOL

VOUCHER
1 $1,495.00 24.89% $0.00 $1,122.85 $1,122.85
Holsters 20160 TASER
7 HOLSTER- SAFARILAND,
RH+CART CARRIER 50 $84.24 24.89% $288.67 $63.27 $3,163.50 Live Cartridges 22175 TASER
7 LIVE CARTRIDGE, STANDOFF (3.5-
DEGREE) NS 150 $38.95 24.90% $400.36 $29.25 $4,387.50
Live Cartridges 22176 TASER
7 LIVE CARTRIDGE, CLOSE
QUARTERS (12-DEGREE) NS 150 $38.95 24.90% $400.35 $29.25 $4,387.50 Halt Suit 20050 HOOK-AND-LOOP TRAINING (HALT) SUIT1 $789.75 24.89% $54.14 $593.16 $593.16 Dock& Warranty Bundle 74200 TASER7 6-BAY DOCK AND CORE1 $1,500.00 24.89% $102.80 $1,126.61 $1,126.61 Handle& Warranty
Bundle 20008 TASER
7 HANDLE, YLW, HIGH VISIBILITY
(GREEN LASER), CLASS 3R 50 $1,810.00 24.89% $6,202.43
$1,359.44 $67,972.00
Hardware Placeholder 20242 TASER CERTIFICATION PROGRAM YEAR 6- 10 HARDWARE 50 $3,009.60 24.89% $10,313.
23 $2,260.43 $113,021.50
Inert Cartridges 22179 TASER
7 INERT CARTRIDGE, STANDOFF
(3.5-DEGREE) NS 50 $50.23 24.89% $172.14 $37.73 $1,886.50 Inert Cartridges 22181 TASER
7 INERT CARTRIDGE, CLOSE
QUARTERS (12-DEGREE) NS 50 $50.23 24.89% $172.14 $37.73 $1,886.50 Instructor Course 20120 TASER7 INSTRUCTOR COURSE VOUCHER1 $375.00 24.89% $0.00 $281.65 $281.65

5 Q-370070-44700.671TR
Vouchers
Instructor Course
Vouchers 20120 TASER
7 INSTRUCTOR COURSE VOUCHER1 $375.00 24.89% $0.00 $281.65 $281.65 Instructor Course
Vouchers 20120 TASER
7 INSTRUCTOR COURSE VOUCHER1 $375.00 24.89% $0.00 $281.65 $281.65 Instructor Course
Vouchers 20120 TASER
7 INSTRUCTOR COURSE VOUCHER1 $375.00 24.89% $0.00 $281.65 $281.65 Instructor Course
Vouchers 20120 TASER
7 INSTRUCTOR COURSE VOUCHER1 $375.00 24.89% $0.00 $281.65 $281.65 Taser7 Target 80087 TASER
7 TARGET, CONDUCTIVE,

PROFESSIONAL (RUGGEDIZED)
1 $157.95 24.89% $10.82 $118.63 $118.63
Spare Handle&
Warranty Bundle 20008 TASER
7 HANDLE, YLW, HIGH VISIBILITY
(GREEN LASER), CLASS 3R
1 $1,810.00 24.89% $124.06 $1,359.44 $1,359.44
Dock Mount 70033 WALL MOUNT BRACKET, ASSY,
EVIDENCE.COM DOCK
1 $43.90 24.90% $2.99 $32.97 $32.97
Admin License 20248 TASER7 EVIDENCE.COM LICENSE1 $5.00 24.89% $0.00 $3.76 $450.64 Taser7 Frame 80090 TARGET FRAME, PROFESSIONAL, 27.5 IN. X 75 IN., TASER 71 $78.98 24.89% $5.41 $59.32 $59.32 Training Live Cartridges 22175 TASER
7 LIVE CARTRIDGE, STANDOFF (3.5-
DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00
Training Live Cartridges 22176 TASER
7 LIVE CARTRIDGE, CLOSE
QUARTERS (12-DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00 Training Live Cartridges 22176 TASER
7 LIVE CARTRIDGE, CLOSE
QUARTERS (12-DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00 Training Live Cartridges 22175 TASER
7 LIVE CARTRIDGE, STANDOFF (3.5-
DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00
Training Live Cartridges 22175 TASER
7 LIVE CARTRIDGE, STANDOFF (3.5-
DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00
Training Live Cartridges 22176 TASER
7 LIVE CARTRIDGE, CLOSE
QUARTERS (12-DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00 Training Live Cartridges 22175 TASER
7 LIVE CARTRIDGE, STANDOFF (3.5-
DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00
Training Live Cartridges 22176 TASER
7 LIVE CARTRIDGE, CLOSE
QUARTERS (12-DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00 Training Live Cartridges 22176 TASER
7 LIVE CARTRIDGE, CLOSE
QUARTERS (12-DEGREE) NS 100 $38.95 24.90% $266.91 $29.25 $2,925.00 Training Live Cartridges 22175 TASER
7 LIVE CARTRIDGE, STANDOFF (3.5-
DEGREE) NS 100 $38.95 24.90% $266.92 $29.25 $2,925.00
Dock Power Cord 71019 NORTH AMER POWER CORD FOR AB3 8-
BAY, AB2 1-BAY/ 6-BAY DOCK
1 $10.45 24.88% $0.72 $7.85 $7.85
Training Halt Cartridges 22177 TASER7 HOOK-AND-LOOP TRN (HALT) 100 $38.95 24.90% $266.92 $29.25 $2,925.00

6 Q-370070-44700.671TR

CARTRIDGE, STANDOFF NS
Training Halt Cartridges 22177 TASER 7 HOOK-AND-LOOP TRN (HALT) CARTRIDGE, STANDOFF NS 100 $38.95 24.90% $266.92 $29.25 $2,925.00 Training Halt Cartridges 22178 TASER 7 HOOK-AND-LOOP TRN (HALT) CARTRIDGE, CLOSE QUART NS 100 $38.95 24.90% $266.92 $29.25 $2,925.00 Training Halt Cartridges 22178 TASER 7 HOOK-AND-LOOP TRN (HALT) CARTRIDGE, CLOSE QUART NS 100 $38.95 24.90% $266.92 $29.25 $2,925.00 Duty Cartridge
Replenishment Plan 20246 TASER 7 DUTY CARTRIDGE REPLACEMENTLICENSE 50 $2.50 24.89% $1,028.0 2 $1.88 $11,266.00
Other 80374 EXT WARRANTY, TASER 7 BATTERY PACK 60 $0.44 24.90% $197.22 $0.33 $2,161.20 Other 80396 EXT WARRANTY, TASER 7 SIX BAY DOCK 1 $6.58 24.89% $49.13 $4.94 $538.68 Other 80395 EXT WARRANTY, TASER 7 HANDLE 50 $6.58 24.89% $2,457.7 4 $4.94 $26,934.00
Other 80395 EXT WARRANTY, TASER 7 HANDLE 1 $6.58 24.89% $49.13 $4.94 $538.68

INDIVIDUAL ITEMS
Category Item Description QTY List Price Discount Tax Net Price Total(USD) Other 85760 Auto-Transcribe Unlimited Service 50 $20.00 3.00% $0.00 $19.40 $116,400.00 Total: $116,400.00
Tax is estimated based on rates applicable at date of quote and subject to change at time of invoicing. If a tax exemption certificate should be applied, please submit prior to invoicing.