Murrieta City Council
March 17, 2026

QUOTE DETAILS (CONT.)
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco FirePOWER 3110 Next-Generation Firewall - firewall 2 6954949 $11,223.04 $22,446.08 Mfg. Part#: FPR3110-NGFW-K9

4. TAX: MURRIETA, CA 8.7500% $1,964.03
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Smart Net Total Care - extended service agreement 2 7047769 $14,953.01 $29,906.02 Mfg. Part#: CON-SNTP-FPR3110N

4.1 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Threat Defense Threat and Malware - subscription
license (3 years) -
2 7109468 $13,949.56 $27,899.12
Mfg. Part#: L-FPR3110T-TM-3Y

4.2 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9500 - Network Advantage - Switch - 48 Port - Managed
4 5083143 $16,037.09 $64,148.36
Mfg. Part#: C9500-48Y4C-A
UNSPSC: 43222612
replaces the Mellanox MSN2410-BB2F
and the Brocade BR-VDX6740

5. TAX: MURRIETA, CA 8.7500% $5,612.98
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco SMARTnet - extended service agreement 4 5689144 $8,522.34 $34,089.36 Mfg. Part#: CON-SNTP-C9504YA4
UNSPSC: 81111811

5.1 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Network and Digital Network Architecture Advantage - Term License (3
4 4712847 $8,587.75 $34,351.00
Mfg. Part#: C9500-DNA-A-3Y
UNSPSC: 43233204

5.2 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco - power supply - 650 Watt 4 7233020 $1,540.06 $6,160.24 Mfg. Part#: C9K-PWR-650WACLR/2

5.3 TAX: MURRIETA, CA 8.7500% $539.02
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9300L - Network Advantage - switch - 24 ports - managed - ra
6 5729778 $4,201.31 $25,207.86
Mfg. Part#: C9300L-24P-4X-A
UNSPSC: 43222612
replaces the Cisco WS-C3560X-24P-S
and the WS-C3560X-24PS-S and the
WS-C2960S-F24PS-L

6. TAX: MURRIETA, CA 8.7500% $2,205.69
130

QUOTE DETAILS (CONT.)
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Digital Network Architecture Advantage - Term License (3 years) - 1 s
6 5661483 $1,530.24 $9,181.44
Mfg. Part#: C9300L-DNA-A-24-3Y
UNSPSC: 43233204

6.2 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Config 1 Secondary Power Supply - power supply -
hot-plug redundant
6 5428371 $828.03 $4,968.18
Mfg. Part#: PWR-C1-715WAC-P/2
UNSPSC: 39121004

6.3 TAX: MURRIETA, CA 8.7500% $434.72
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9300L - Network Advantage - switch - 48 ports - rack-mountab
3 5717809 $5,202.52 $15,607.56
Mfg. Part#: C9300L-48T-4X-A
UNSPSC: 43222612
replaces the WS-C3650-48TD

7. TAX: MURRIETA, CA 8.7500% $1,365.66
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Smart Net Total Care - extended service agreement 3 6330982 $2,764.61 $8,293.83 Mfg. Part#: CON-SNTP-CX9300L4

7.1 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Digital Network Architecture Advantage - Term License (3 years) - 48
3 5657892 $2,675.69 $8,027.07
Mfg. Part#: C9300L-DNA-A-48-3Y
UNSPSC: 43233204

7.2 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Config 1 Secondary Power Supply - power supply -
hot-plug redundant
3 5430601 $430.57 $1,291.71
Mfg. Part#: PWR-C1-350WAC-P/2
UNSPSC: 39121004

7.3 TAX: MURRIETA, CA 8.7500% $113.02
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 4727106 $12,938.31 $12,938.31
Mfg. Part#: C9407R-96U-BNDL-A
UNSPSC: 43222612
replaces 4507

9.1 TAX: MURRIETA, CA 8.7500% $1,132.10
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco SMARTnet extended service agreement 1 5689111 $8,911.53 $8,911.53 Mfg. Part#: CON-SNTP-C9407R9A
UNSPSC: 81111811
131

QUOTE DETAILS (CONT.)

9.2 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Digital Network Architecture Advantage - 1 l 1 4736633 $9,120.40 $9,120.40 Mfg. Part#: C9400-DNA-A-3Y
UNSPSC: 43233204

9.3 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco - power supply - hot-plug redundant - 3200 Watt 4 4727097 $1,497.08 $5,988.32 Mfg. Part#: C9400-PWR-3200AC
UNSPSC: 39121004

9.4 TAX: MURRIETA, CA 8.7500% $523.98
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco U.S. Export Restriction Compliance - license 1 6850253 $0.61 $0.61 Mfg. Part#: C9000-HSEC

9.5 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Supervisor 2 Module - control processor 1 7001618 $14,265.73 $14,265.73 Mfg. Part#: C9400X-SUP-2/2

9.6 TAX: MURRIETA, CA 8.7500% $1,248.25
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Supervisor Module - control
processor
1 7001626 $3,724.18 $3,724.18
Mfg. Part#: C9400X-SUP-2-B

9.7 TAX: MURRIETA, CA 8.7500% $325.87
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 5936527 $2,209.60 $2,209.60
Mfg. Part#: C9400-LC-48H-B

9.8 TAX: MURRIETA, CA 8.7500% $193.34
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 24 ports - plug-in module
1 5205690 $10,274.00 $10,274.00
Mfg. Part#: C9400-LC-24S
UNSPSC: 43222612

9.9 TAX: MURRIETA, CA 8.7500% $898.98
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 5777222 $6,736.86 $6,736.86
Mfg. Part#: C9400-LC-48H
UNSPSC: 43222612

9.10 TAX: MURRIETA, CA 8.7500% $589.48
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
132

QUOTE DETAILS (CONT.)
Cisco Catalyst 9400 Series Chassis - Switch - Rack-Mountable 1 4729333 $20,948.23 $20,948.23 Mfg. Part#: C9410R-96U-BNDL-A
UNSPSC: 43222612
replace 4510

10. TAX: MURRIETA, CA 8.7500% $1,832.97
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco SMARTnet extended service agreement 1 8482851 $9,598.48 $9,598.48 Mfg. Part#: CON-SNTP-C9410R9A

10.1 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Digital Network Architecture Advantage - 1 l 1 4736633 $9,120.05 $9,120.05 Mfg. Part#: C9400-DNA-A-3Y
UNSPSC: 43233204

10.2 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco - power supply - hot-plug redundant - 3200 Watt 4 4727097 $1,497.08 $5,988.32 Mfg. Part#: C9400-PWR-3200AC
UNSPSC: 39121004

10.3 TAX: MURRIETA, CA 8.7500% $523.98
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco U.S. Export Restriction Compliance - license 1 6850253 $0.61 $0.61 Mfg. Part#: C9000-HSEC

10.4 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Supervisor 2 Module - control processor 1 7001618 $14,265.73 $14,265.73 Mfg. Part#: C9400X-SUP-2/2

10.5 TAX: MURRIETA, CA 8.7500% $1,248.25
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Supervisor Module - control
processor
1 7001626 $3,724.18 $3,724.18
Mfg. Part#: C9400X-SUP-2-B

10.6 TAX: MURRIETA, CA 8.7500% $325.87
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 5936527 $2,209.60 $2,209.60
Mfg. Part#: C9400-LC-48H-B

10.7 TAX: MURRIETA, CA 8.7500% $193.34
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 5777222 $6,736.86 $6,736.86
Mfg. Part#: C9400-LC-48H
UNSPSC: 43222612

10.8 TAX: MURRIETA, CA 8.7500% $589.48
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
133

QUOTE DETAILS (CONT.)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 5777222 $6,736.86 $6,736.86
Mfg. Part#: C9400-LC-48H
UNSPSC: 43222612

10.9 TAX: MURRIETA, CA 8.7500% $589.48
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 24 ports - plug-in module
1 5205690 $10,274.06 $10,274.06
Mfg. Part#: C9400-LC-24S
UNSPSC: 43222612

10.10 TAX: MURRIETA, CA 8.7500% $898.98
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 5777222 $6,736.86 $6,736.86
Mfg. Part#: C9400-LC-48H
UNSPSC: 43222612

10.11 TAX: MURRIETA, CA 8.7500% $589.48
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 5777222 $6,736.86 $6,736.86
Mfg. Part#: C9400-LC-48H
UNSPSC: 43222612

10.12 TAX: MURRIETA, CA 8.7500% $589.48
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Catalyst 9400 Series Line Card - switch - 48 ports - plug-in module
1 5777222 $6,736.86 $6,736.86
Mfg. Part#: C9400-LC-48H
UNSPSC: 43222612

10.13 TAX: MURRIETA, CA 8.7500% $589.48
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco SFP+ Copper Twinax Cable - direct attach cable - 3 m 1 2458333 $80.36 $80.36 Mfg. Part#: SFP-H10GB-CU3M=
UNSPSC: 26121609
11 TAX: MURRIETA, CA 8.7500% $7.03
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
Cisco Smart Net Total Care - extended service agreement 6 6517011 $2,234.80 $13,408.80 Mfg. Part#: CON-SNTP-C93024PX

6.1 Electronic distribution - NO MEDIA
TAX: MURRIETA, CA .0000% $.00
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
CISCO DIRECT CSF220-TD-K9 4 9043768 $927.66 $3,710.64
Mfg. Part#: CSF220-TD-K9

3.0 TAX: MURRIETA, CA 8.7500% $324.68
Contract: OMNIA Mesa 2024056-01 - GOV (2024056-01)
CIS CCW SN CON-SNTP-CSF220TK 4 9045640 $1,248.02 $4,992.08 Mfg. Part#: CON-SNTP-CSF220TK
134
135

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CITY OF MURRIETA
City Council Meeting Agenda
Report
3/17/2026
Agenda Item No. 6.

TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Diego Chavez, Administrative Services Director
PREPARED BY: John Borger, IT Manager
SUBJECT:

Microsoft Software Licensing Agreement

RECOMMENDATION
Authorize the City Manager to enter into a five (5) year Microsoft Enterprise Volume Licensing Agreement through the Statewide Enterprise Licensing Agreement administered by the California Department of Technology (CDT) and authorize SHI, LLC to administer the agreement, including the CDT service fee; Approve a separate three-year Microsoft Select Plus Agreement with the County of Riverside, also administered by SHI, LLC;
Approve both agreements for a combined not-to-exceed amount of $1,501,495.41, which includes the five (5) year CDT service fee of $88,247.78;
Authorize the City Manager to execute all necessary and related documents for the term of the agreements; and
Amend the FY 2025/26 Operating budget to establish an additional appropriation of $17,622.09 in the Information Technology Operating Fund.

PRIOR ACTION/VOTE
On May 5, 2020, the City Council adopted Resolution No. 20-4234, entering into the Microsoft Enterprise Enrollment Agreement, authorizing SoftwareOne to administer the agreement, and authorizing the City Manager to execute the agreement and all necessary and related documents for any subsequent software licenses for the term of the agreement.

On April 18, 2023, the City Council authorized entering into the Microsoft Enterprise Enrollment Agreement, authorizing the use of Contract 9-19-70-0012A with the California Department of General Services, authorized Crayon Software Experts, LLC to administer the agreements, and authorized the City Manager to execute the agreements and all necessary and related documents for any subsequent software licenses for the term of the agreements (Vote 4-0-1).

CITY OF MURRIETA Printed on 3/12/2026Page 1 of 3
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3/17/2026
Agenda Item No. 6.

CITY COUNCIL GOAL
Provide a high level of innovative public safety.

DISCUSSION
In April 2023, the City Council authorized the City to enter into a Microsoft Enterprise Enrollment Agreement for a three (3) year term to provide essential software that is used by employees across all City departments. This agreement includes widely used applications such as Word, Excel, Outlook, and Teams, along with secure cloud-based services for email, file storage, collaboration, and cybersecurity protection.

The current agreement expires on March 31, 2026, and must be renewed to ensure continued access to these productivity programs and systems. The proposed renewal includes updated licensing to account for additional staff positions authorized by the City Council and provides enhanced security features to meet current cybersecurity standards.

Staff recommends approving the following two agreements:

1. A five (5) year Microsoft Enterprise Agreement (Attachment 1) secured through the Statewide Enterprise Licensing Agreement, which provides standardized pricing and statewide negotiated terms. This agreement also includes a California Department of Technology (CDT) service fee of $88,247.78 for administration and support over the life of the contract.

2. A three (3) year Microsoft Select Plus Agreement (Attachment 2) through the County of Riverside for specific Microsoft products not included in the Enterprise Agreement.

Based on best value and established cooperative purchasing programs, the Information Technology Division recommends utilizing SHI, LLC as the City’s authorized value-added reseller. Pricing is available through master agreements negotiated by the CDT and the County of Riverside, providing favorable public -sector pricing.

These agreements ensure continuity of these software services from April 1, 2026, through March 31, 2031. They allow the City to maintain strong cybersecurity protections offered only to Microsoft government clients and provide predictable long-term costs for these essential programs.

PUBLIC NOTICING
The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item).

CEQA AND REGULATORY OVERVIEW
This action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly.

FISCAL IMPACT
The total cost of both agreements is $1,501,254.58, as detailed below, which includes the five (5) year CDT service fee of $88,247.78.

Microsoft Enterprise Agreement (five (5) years):

CITY OF MURRIETA Printed on 3/12/2026Page 2 of 3
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Agenda Item No. 6.
4/1/2026 - 3/31/2027: $271,006.92
4/1/2027 - 3/31/2028: $271,006.92
4/1/2028 - 3/31/2029: $279,841.20
4/1/2029 - 3/31/2030: $279,841.20
4/1/2030 - 3/31/2031: $279,841.20
Total: $1,381,537.44 (Attachment 3)
CDT Service Fee (five (5) years): $88,247.78
Microsoft Select Plus Agreement (three (3) years):
4/1/2026 - 3/31/2029: $31,469.63 (Attachment 4)
The Fiscal Year 2025/26 cost for both agreements is $320,126.11, consisting of:
· $271,006.92 for the first year of the Microsoft Enterprise Agreement; · $31,469.63 for the Microsoft Select Plus Agreement; and · $17,649.56 for one-fifth of the CDT service fee.

The Fiscal Year 2025/26 Information Technology Operating Budget includes $302,504.02 for these agreements. Staff recommends an amendment to the FY 2025/26 Operating budget to establish an additional appropriation of $17,622.09 in the Information Technology Operating Fund account 7268340-62160 to fully fund Fiscal Year 2026 costs.

Future year costs will be incorporated into the City’s biennial budget process.

ATTACHMENTS
ATT 1 - Statewide Enterprise Licensing Agreement
ATT 2 - Microsoft Select Plus Agreement - County of Riverside ATT 3 - Software Licensing Quote - Select Plus
ATT 4 - Software Licensing Quote - Enterprise Agreement CITY OF MURRIETA Printed on 3/12/2026Page 3 of 3
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STATE OF CALIFORNIA SHI INTERNATIONAL CORP. DEPARTMENT OF TECHNOLOGY PO 25-0198737/ SC 25-0198737

EXHIBIT ASTATEMENT OF WORK 1. Contract Description A. SHI International Corp. (hereinafter referred to as the “Contractor”) agrees to provide the California Department of Technology (hereinafter referred to as the “State,” “CDT,” and/or the “Licensee”) with Microsoft Online Subscriptions. As part of this Statewide Enterprise Licensing Agreement (Agreement), which consists of all the documents set forth in the Order of Precedence in Section 2 below, the Contractor must: 1) Provide Microsoft Online Subscriptions to M365 G5 Government Community Cloud (GCC) offerings and any additional GCC add-ons as detailed in the Exhibit C-1 Cost Worksheet. 2) Provide option(s) for State of California entities and local government agencies such as counties and cities (“Customer Affiliates”) to standardize Microsoft Security, Compliance and Communications transacted using the M365 G5 GCC offerings and any add-ons. 3) Create a new enrollment with Microsoft Security, Compliance and Communications, using the M365 G5 offering, and including options for adding Microsoft “additional GCC product” online services during a five (5) year term. 4) Discounts for State entity Customer Affiliates will differ from those of Local government Customer Affiliates in years one (1) and two (2) of this Agreement. B. The Microsoft Online Services Subscriptions will be provided by the manufacturer, Microsoft. C. Customer Affiliates will reserve approved subscriptions/licenses directly from the Microsoft 365 Admin Center (MAC). D. Under the terms of this Agreement, each Customer Affiliate will be their own tenant. E. Terms and Conditions of Department of General Services (DGS) Software Cooperative Agreement (SCA), County of Riverside Request for Quote (RFQ) #ITARC-00532, and Microsoft Master Agreement #8084445 shall apply to this Agreement though the life of its term subject to the Order of Precedence set forth in Section 2 below. 2. Modifications and Clarifications to the DGS PD 402-ITGP Cloud (REV. 02/20/2025) A. Section 3 of the DGS PD 402-ITGP Cloud (REV. 02/20/2025) are hereby deleted in their entirety and replaced with the following: Section 3: ORDER OF PRECEDENCE In the event of any inconsistency or conflict between the sections, exhibits, attachments, specifications, or provisions comprising the Contract, the following order of precedence shall apply:
140
STATE OF CALIFORNIA SHI INTERNATIONAL CORP. DEPARTMENT OF TECHNOLOGY PO 25-0198737/ SC 25-0198737

(a) These GSPD – ITGP (Cloud) (except in the instances herein where the provision contains “Unless otherwise specified in the Statement of Work” (or similar phrase), the provisions specified in the Statement of Work shall take precedence over the provisions referenced in these GSPD – ITGP (Cloud)); (b) Contract form(s), i.e., Purchase Order STD 65, Standard Agreement STD 213, FI$Cal generated Purchase Order, etc., and any amendments; (c) Other Special Provisions (except in the instances therein where the provision contains “Unless otherwise specified in the Statement of Work” (or similar phrase), the provisions specified in the Statement of Work shall take precedence over the provisions referenced in the applicable Special Provisions); (d) CDT’s Statement of Work (SOW), as an exhibit, including any specifications incorporated by reference herein; (e) Cost worksheets; (f) Other work description, work authorization or exhibit issued by Users; (g) DGS SCA Agreement and any amendments thereto; (h) County of Riverside RFQ # ITARC-00532; (i) Microsoft Master Agreement #8084445; and (j) All other Contractor’s or Service Provider’s attachments included in Contract and/or incorporated in Contract by reference (e.g., end User license agreements, acceptable use policies, service guides, product specific terms and conditions). 3. Clarifications to the DGS SLP, DGS SCA, and County of Riverside Request for Quote (RFQ) #ITARC-00532A. For the avoidance of doubt, notwithstanding Section 9.4 of the County of Riverside RFQ #ITARC-00532, Order of Precedence in the DGS SCA, or any other provision to the contrary, the Order of Precedence in Section 2 of this Statement of Work shall apply to this Agreement. B. For the avoidance of doubt, termination of the County of Riverside Agreement #ITARC-00532, Microsoft Master Agreement Number 8084445, or DGS SCA does not automatically terminate this Agreement and will remain in full force and effect. Any modifications to this Agreement will be documented through an amendment as set forth in the DGS PD 402-ITGP Cloud (REV. 02/20/2025). 4. Third Party Solutions Contractor shall not provide, integrate, resell, access, or make available to the State or Customer Affiliate any third-party services, solutions, tools, platforms, or products (including open-source or hosted services) (“Third Party Solutions”) in connection with the Microsoft Online Subscriptions to M365 G5 GCC offerings and additional Microsoft GCC add-ons as detailed in the Exhibit C-1 Cost Worksheet unless such Third Party Solutions are expressly approved in writing by CDT Information Technology Program Management (“CDT ITPM”) and are subject to the terms and conditions of this Agreement. Contractor shall not structure its performance, delivery model, or technical architecture in a manner that circumvents the 141
STATE OF CALIFORNIA SHI INTERNATIONAL CORP. DEPARTMENT OF TECHNOLOGY PO 25-0198737/ SC 25-0198737

applicability of this Agreement to any services, solutions, or products provided to the State or Customer Affiliates. Contractor shall not add any Third Party Solutions or Third Party Solution SKUs to its product/service catalog. For avoidance of doubt, no third party terms shall apply to the State or Customer Affiliates unless expressively agreed in a written amendment signed by CDT. Any approved Third Party Solutions shall comply with the security, confidentiality, data protection, audit and other obligations of this Agreement. Any breach of this section by Contractor shall constitute a material breach of this Agreement. 5.TermA. The term of this Agreement shall be five (5) years. Agreement start date is 4/1/2026, with an expiration date of 3/31/2031. B. The effective date of this enrollment will be 4/1/2026 and processed by Microsoft and available for use in Customer Affiliate portals. The anniversary date schedule shall be as follows: 1stanniversary is 4/1/2027. 2ndanniversary is 4/1/2028. 3rdanniversary is 4/1/2029. 4thanniversary is 4/1/2030. 6. Licensee Site/Location The “Licensee Site” shall mean site where CDT or its Customer Affiliate tenants operate or control the use or access to Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons. CDT or its Customer Affiliate tenants may change the Licensee Site to another location located within the United States without incurring additional charges. 7. License Type Annual Software as a Service (SaaS) Subscription for Microsoft Online Subscriptions to M365 G5 GCC and any additional GCC add-ons. 8. Installed on All online services associated with this Agreement will run out of the manufacturer’s data centers. 9. True-Ups A. CDT ITPM may request, in writing, for Contractor to add any additional Microsoft products and support services to the product/services catalog, as needed. The addition of new Microsoft products and support services will be upon mutual written consent of Contractor and CDT ITPM and may not require a formal amendment to the Agreement. For clarity, Customer Affiliates or Contractor shall not add any new or additional Microsoft products or support services to the product/services catalog without prior written approval of CDT ITPM. 142
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B. Throughout the term of the Agreement, Customer Affiliate may add the quantity of Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons that the Customer Affiliate procured under the current purchase order (PO). Upon request by Customer Affiliate, CDT may issue an amended PO to decrement the quantity of Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons that the Customer Affiliate procured under the current PO. C. Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons are price protected (fixed prices throughout the term of the Agreement) and shall be priced by the Contractor at the price set forth in Exhibit C-1 Cost Worksheet and for the add-ons the price is set forth in the product/service catalog. D. The Contractor shall work collectively with Microsoft to promptly resolve any issues CDT or Customer Affiliates are experiencing with their reservations. E. The Contractor shall provide CDT an annual report sixty (60) days before each anniversary date (set forth in Section 5.B above) of Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons added and decremented during the current PO. F. CDT will perform true-ups to add or true-downs to decrement Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons counts once a year (prior to the anniversary date, which is defined in Section 5.B above). 1) Contractor to provide Customer Affiliates with budgetary quote for annual reconciliation sixty (60) days prior to each anniversary date. 2) Contractor shall process the true-ups or true-downs prior to each anniversary date (set forth in Section 5.B above) and submit an email confirmation of such to CDT. 3) Contractor shall not accept or process any new reservations for Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons in the thirty (30) days prior to the expiration of the Agreement (03/31/2031). G. The Contractor shall process certain requests for add-ons for Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons throughout the term of each PO for the following scenarios: 1) Time sensitive promotional part number and/or SKUs, which require invoicing by a certain date to be valid. 2) Time sensitive orders that are associated with End Customer Investment Funds (ECIF). 3) Limited situations where the normal true-up/reconciliation window could negatively impact a special negotiation with CDT or Customer Affiliates. 143
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10.Notices All notices required by, or relating to, this Agreement shall be in writing and shall be sent to the parties of this Agreement as set below unless changed from time to time, in which event each party shall notify the other in writing, by e-mail communication: State Agency Contractor ManufacturerCDT SHI International Corp. MicrosoftAttn: IT Program Management Jason Goudie John RobinsonAddress: PO Box 1810Rancho Cordova, CA 95741PO Box 952121Dallas, TX 75395-2121 N/APhone: N/A 435-301-2383 (916) 369-3630E-mail:[email protected]@[email protected] [email protected] Responsibilities A. CDT will designate a Contract Manager to whom all Contractor communication may be addressed and who has the authority to act on all aspects of the service. This person may review the Agreement and associated documents with the Contractor to ensure understanding of the responsibilities of both parties. B. CDT will provide timely review and approval of information and documentation provided by the Contractor to perform its obligations. C. Upon execution of this Agreement, CDT will provide a STD 65 master purchase order for the Contract total amount and term. CDT will subsequently issue FI$Cal POs to the Contractor for each Customer Affiliate tenant. 12.Contractor Responsibilities A. Contractor to provide a dedicated staff/team with clearly identified roles, responsibilities, and list primary and back-up support. B. The Contractor shall designate a primary and secondary contact person to whom all Agreement/PO communications may be addressed and who has the authority to act on all aspects of the services. C. The Contractor shall provide a path of escalation for all communication and Agreement/PO related matters. D. The Contractor shall ensure dedicated staff are available during State business hours of 7:30 AM, PT to 5:30 PM, PT. E. The Contractor shall promptly respond (within 2 business days) in efforts to resolve Customer Affiliate issues encountered while reserving Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons via the MAC. 144
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F. The Contractor shall promptly work with the Customer Affiliate and Microsoft to reverse any unauthorized Microsoft Online Subscriptions to M365 G5 GCC offerings and any additional GCC add-ons reservations to prevent charges. If a Customer Affiliate reserves a license from the MAC not on the approved product/service catalog, the Contractor will facilitate its immediate cancellation to ensure no costs are incurred. G. The Contractor shall provide written notice to CDT of any change in the part number, product SKU number, description of the SKUs in the product/service catalog. H. The Contractor shall provide written notice to CDT regarding any updates to products within the product/service catalog that incorporate Generative Artificial Intelligence (GenAI) in accordance with DGS PD 402-ITGP Cloud (REV. 02/20/2025). I. The Contractor must adhere to invoicing requirements listed in Exhibit B. J. The Contractor shall invoice CDT separately for each Customer Affiliate tenant. K. The Contractor shall provide CDT with written e-mail confirmation upon receipt of PO or PO amendment. L. Any documents requiring electronic signature shall be sent to CDT ([email protected])and not Customer Affiliate. M. Following execution of this Agreement, the Contractor will schedule a kickoff meeting within 5-10 business days with CDT to discuss CDT billing and invoicing requirements and develop a plan for collaboration and streamlining of billing and invoicing procedures. N. The Contractor shall not offer or discuss any new Microsoft product or non-GCC Add-Ons not listed on the pre-approved product/service catalog with Customer Affiliates without prior approval from the CDT Contract Manager. 13.Maintenance/Technical Support The Contractor shall ensure that maintenance and support is provided by the manufacturer, Microsoft, throughout the term of this Agreement. Web Support: https://admin.microsoft.com/ 14.Problem Escalation A. The parties acknowledge that certain technical and project-related problems or issues may arise and that each party shall bring such matters to the immediate attention of the other party when identified. Known problems or issues shall be reported in regular weekly status reports or meetings. However, there may be instances where the severity of the problem justifies escalated reporting. To this extent, the State's Primary Contact will determine the next level of severity and notify the appropriate State and Manufacturer personnel. The personnel notified, and the time period taken to report the problem or issue, shall be at a level commensurate with the severity of the problem or issue. B. The State personnel include, but are not limited to the following:
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First Level: CDT Contract Manager Second Level: CDT Branch Chief Third Level: CDT Deputy Director C. The Contractor personnel include, but are not limited to the following: First Level: Name: Jason Goudie Title: Microsoft Account Executive, Public Sector Sales, CA Email: [email protected] Number: 435-301-2383. Second Level: Name: Stephen Dean Title: District Manager – Microsoft, Public Sector Sales Email: [email protected] Contact Number: 512-702-5720. Third Level: Name: Matt OLeary Title: Vice President – Microsoft, Public Sector Sales Email: [email protected] Number: 206-390-4361. D. The Manufacturer personnel include, but are not limited to the following: First Level: Name: John Robinson Title: Sr. Commercial Executive Email: [email protected] Contact Number: 916-369-3630. Second Level: Name: Jennifer Rucker Title: Director of Sales Email: [email protected] Contact Number: 916-503-5117. Third Level: Name: Madison O’Kane Title: Director of Commercial SLED Licensing Email: [email protected] Number: 425-538-2123. 15.Amendments Consistent with the terms and conditions of the original solicitation, and upon mutual consent, CDT and the Contractor may execute amendments to this Agreement for changes to add available products per the most current SCA pricelist posted on the Cal eProcure website for quantity, money and/or time. No additional products or services can be added to this Agreement. No amendment or variation of the terms of this Agreement shall be valid unless made in writing, and agreed upon by both parties and approved, as required. No verbal understanding or agreement not incorporated into the Agreement is binding on any of the parties. 146
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16. Advertising of Data In accordance with the General Provisions (DGS PD 402-ITGP Cloud (REV. 02/20/2025)), the Contractor and Microsoft are not authorized to use, sell, resell, package or repackage, or publicly display any information or data without the express written approval of the State. This restriction includes keyword searching or data mining of State data. Advertising is not allowed in any of these services or to any of the contacts associated with these services. 17. Federal Tax Administration RequirementsCDT must notify the United States Internal Revenue Service (IRS) prior to executing, or amending, any agreement to disclose, or provide access to, federal tax information (FTI) to a Contractor or Sub-Contractor, at least forty-five (45) calendar days prior to the disclosure of FTI, to ensure appropriate contractual language is included and that Contractors are held to safeguarding requirements. This procedure conforms to IRS Publication 1075. Subject to the IRS, FTI requirements, if an unfavorable response is received by the IRS, this contract will be terminated immediately per the Cloud Computing Services - General Provisions – Information Technology (402-ITGP), clause 16.3, Termination for Default. In conformation with IRS Publication 1075, Contractor must comply with these terms. 18. Clean Air Act (42 U.S.C. 7401-7671q) and the Federal Water Pollution Control Act (33 U.S.C. 1251-1388) The Contractor agrees to comply with all applicable standards, orders or regulations issued pursuant to the Clean Air Act (42 U.S.C. 7401-7671q) and the Federal Water Pollution Control Act as amended (33 U.S.C. 1251-1387). Violations must be reported to the Federal awarding agency and the Regional Office of the Environmental Protection Agency (EPA). 147
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EXHIBIT BBUDGET DETAIL AND PAYMENT PROVISIONS 1.Payment and InvoicingA. Payment will be made annually in advance for the subscription year and upon receipt of a correct invoice. Invoices may be submitted on or after the first day of the term referenced in the executed PO. The invoice shall include booking confirmation of the CDT order per each environment; including but not limited to, the Contract number, the individual Customer PO number, the Customer Department, the EA/Tenant ID/number, the product name, Part/SKU number, unit cost, extended cost, code (if applicable), must reference a specific PO line item, term dates and include PO amendment number if applicable; and shall reference the Agency Order Number and the Microsoft Enterprise License Agreement (MELA) Software Cooperative Agreement (SCA) number SCA-24-70-0003U. B. Submit your invoice using only one of the following options: 1) Send via U.S. mail in TRIPLICATE to: California Department of Technology Administration Division – Accounting Office P. O. Box 1810 Rancho Cordova, CA 95741 OR 2) Submit electronically at: [email protected] C. If there is a change in cost to a license, or if the start date for licenses is changed so that it impacts pricing (i.e., term and activation of licenses falls after the 2nd of the month, and so billing begins the following month), the Contractor must provide product pricing change update and quote to the Customer Affiliate so that an amendment can be executed to the Customer Affiliate’s PO, to reflect the correct pricing. D. Payment will be made in accordance with, and within the time specified in, Government Code Chapter 4.5, commencing with Section 927. Payment to small/micro businesses shall be made in accordance with and within the time specified in Chapter 4.5, Government Code 927 et seq. 2. Budget Contingency Clause A. It is mutually agreed that if the Budget Act of the current year and/or any subsequent years covered under this Contract does not appropriate sufficient funds for the program, this Contract shall be of no further force and effect. In this event, the State shall have no liability to pay any funds whatsoever to the Contractor or to furnish any other considerations under this contract and Contractor shall not be obligated to perform any provisions of this contract. B. If funding for any fiscal year is reduced or deleted by the Budget Act for purposes of this program, the State shall have the option to either cancel this Contract with no liability 148
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occurring to the State or offer a contract amendment to the Contractor to reflect the reduced amount. 149
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EXHIBIT C COST WORKSHEET DETAILS The Contractor shall submit a completed Attachment 1B (Exhibit C-1) Cost Worksheet, attached to the Request For Offer (RFO). The Contractor must adhere to the following: A. Subscriptions of the FromSA M365 G5 SKU will renew using the M365 G5 FromSA Renewal SKU. Subscriptions renewing from the M365 G5 Full SKU will renew as M365 G5 Full. B. Incremental additional M365 G5 GCC licenses added to enrollments for participating Customer Affiliates from day one (1) shall be priced at “Full” pricing, which is different from the “Full” pricing for those subscriptions that are renewing from “Full” subscriptions on 4/1/2026. C. All future new enrollments for M365 G5 GCC shall qualify for “Full” pricing. D. Pricing for true-ups will be equivalent to new enrollment pricing for all approved products. E. Pricing shall not exceed the negotiated discounts. F. Pricing for all Microsoft products offered under this Agreement shall be price protected throughout the term of this Agreement. G. The December 2025 price list will be the basis to determine final pricing. H. All pricing in Attachment 1B (Exhibit C-1) Cost Worksheet must be to two decimal points only. Any pricing that exceeds two decimal points will be rounded down to the nearest cent. I. Information Worker (IW) in Attachment 1B (Exhibit C-1) Cost Worksheet refers to worker licensed with M365 G5 and each Customer Affiliate has a unique number of IWs. J. For pricing purposes of items in Attachment 1B (Exhibit C-1) Cost Worksheet with IW threshold/eligibility conditions, each Customer Affiliate’s IW total shall be treated as a separate and independent quantity. K. For any new Microsoft products added to the product/service catalog after the execution of this Agreement, Contractor must provide a margin above Contractor’s cost from Microsoft (represented as a percentage), which will not be exceeded when such new Microsoft products are offered to Customer Affiliates. 150
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EXHIBIT DGENERAL PROVISIONS These provisions are hereby incorporated by reference. The provisions are revised and effective 2/20/2025 for the Cloud and Non-Cloud. Cloud Computing Services – General Provisions (DGS PD 402-ITGP Cloud (REV. 02/20/2025)) https://www.dgs.ca.gov/%7E/media/Divisions/PD/Acquisitions/Solicitation-Document-Attachments/IT-General-Provisions-Cloud-DGS-PD-402ITGP-Revised-02202025.pdf 159
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EXHIBIT E SPECIAL PROVISIONS These provisions are hereby incorporated by reference. The provisions are revised and effective January 2025 for the GenAI Special Provisions. Generative AI (GENAI) Special Provisions https://cdt.ca.gov/wp-content/uploads/2025/02/GenAI-Special-Provisions-January-2025.pdf 160
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EXHIBIT F SPECIAL TERMS AND CONDITIONS TO SAFEGUARD FEDERAL TAX INFORMATION Federal statute, regulations and guidelines require that all contracts for services relating to the processing, storage, transmission, or reproduction of federal tax returns or return information, the programming, maintenance, repair, or testing of equipment or other property, or the providing of other services, for tax administration purposes include the provisions contained in this exhibit. Contractor agrees to comply with 26 United States Code (U.S.C) §6103(n), 26 Code of Federal Regulations (C.F.R) §301.6103(n)-1(a)(2) and (d), and Internal Revenue Service (IRS) Publication 1075, Tax Information Security Guidelines for Federal, State and Local Agencies (Rev. 11-2021), Section 2.C.8., 2.C.9, and Exhibit 7) and all applicable conditions and restrictions as may be prescribed by the IRS by regulation, published rules or procedures, or written communication to the contractor. Internal Revenue Service (IRS) Publication 1075, Tax Information Security Guidelines for Federal, State and Local Agencies (Rev. 11-2021) https://www.irs.gov/pub/irs-pdf/p1075.pdf EXHIBIT 7 - SAFEGUARDING CONTRACT LANGUAGE I. PERFORMANCE In performance of this contract, the Contractor agrees to comply with and assume responsibility for compliance by officers or employees with the following requirements: (1) All work will be performed under the supervision of the contractor. (2) The contractor and contractor’s officers or employees to be authorized access to FTI must meet background check requirements defined in IRS Publication 1075. The contractor will maintain a list of officers or employees authorized access to FTI. Such list will be provided to the agency and, upon request, to the IRS. (3) FTI in hardcopy or electronic format shall be used only for the purpose of carrying out the provisions of this contract. FTI in any format shall be treated as confidential and shall not be divulged or made known in any manner to any person except as may be necessary in the performance of this contract. Inspection or disclosure of FTI to anyone other than the contractor or the contractor’s officers or employees authorized is prohibited. (4) FTI will be accounted for upon receipt and properly stored before, during, and after processing. In addition, any related output and products require the same level of protection as required for the source material. (5) The contractor will certify that FTI processed during the performance of this contract will be completely purged from all physical and electronic data storage with no output to be retained by the contractor at the time the work is completed. If immediate purging of physical and electronic data storage is not possible, the contractor will certify that any FTI in physical or electronic storage will remain safeguarded to prevent unauthorized disclosures. 161
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(6) Any spoilage or any intermediate hard copy printout that may result during the processing of FTI will be given to the agency. When this is not possible, the contractor will be responsible for the destruction of the spoilage or any intermediate hard copy printouts and will provide the agency with a statement containing the date of destruction, description of material destroyed, and the destruction method. (7) All computer systems receiving, processing, storing, or transmitting FTI must meet the requirements in IRS Publication 1075. To meet functional and assurance requirements, the security features of the environment must provide for the managerial, operational, and technical controls. All security features must be available and activated to protect against unauthorized use of and access to FTI. (8) No work involving FTI furnished under this contract will be subcontracted without the prior written approval of the IRS. (9) Contractor will ensure that the terms of FTI safeguards described herein are included, without modification, in any approved subcontract for work involving FTI. (10) To the extent the terms, provisions, duties, requirements, and obligations of this contract apply to performing services with FTI, the contractor shall assume toward the subcontractor all obligations, duties and responsibilities that the agency under this contract assumes toward the contractor, and the subcontractor shall assume toward the contractor all the same obligations, duties and responsibilities which the contractor assumes toward the agency under this contract. (11) In addition to the subcontractor’s obligations and duties under an approved subcontract, the terms and conditions of this contract apply to the subcontractor, and the subcontractor is bound and obligated to the contractor hereunder by the same terms and conditions by which the contractor is bound and 202 obligated to the agency under this contract. (12) For purposes of this contract, the term “contractor” includes any officer or employee of the contractor with access to or who uses FTI, and the term “subcontractor” includes any officer or employee of the subcontractor with access to or who uses FTI. (13) The agency will have the right to void the contract if the contractor fails to meet the terms of FTI safeguards described herein. II. CRIMINAL/CIVIL SANCTIONS (1) Each officer or employee of a contractor to whom FTI is or may be disclosed shall be notified in writing that FTI disclosed to such officer or employee can be used only for a purpose and to the extent authorized herein, and that further disclosure of any FTI for a purpose not authorized herein constitutes a felony punishable upon conviction by a fine of as much as $5,000 or imprisonment for as long as 5 years, or both, together with the costs of prosecution. (2) Each officer or employee of a contractor to whom FTI is or may be accessible shall be notified in writing that FTI accessible to such officer or employee may be accessed only for a purpose and to the extent authorized herein, and that access/inspection of FTI without an official need-to-know for a purpose not authorized herein constitutes a criminal misdemeanor punishable upon conviction by a fine of as much as $1,000 or imprisonment for as long as 1 year, or both, together with the costs of prosecution. 162
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(3) Each officer or employee of a contractor to whom FTI is or may be disclosed shall be notified in writing that any such unauthorized access, inspection or disclosure of FTI may also result in an award of civil damages against the officer or employee in an amount equal to the sum of the greater of $1,000 for each unauthorized access, inspection, or disclosure, or the sum of actual damages sustained as a result of such unauthorized access, inspection, or disclosure, plus in the case of a willful unauthorized access, inspection, or disclosure or an unauthorized access/inspection or disclosure which is the result of gross negligence, punitive damages, plus the cost of the action. These penalties are prescribed by IRC sections 7213, 7213A and 7431 and set forth at 26 CFR 301.6103(n)-1. (3) Additionally, it is incumbent upon the contractor to inform its officers and employees of the penalties for improper disclosure imposed by the Privacy Act of 1974, 5 U.S.C. 552a. Specifically, 5 U.S.C. 552a(i)(1), which is made applicable to contractors by 5 U.S.C. 552a(m)(1), provides that any officer or employee of a contractor, who by virtue of his/her employment or official position, has possession of or access to agency records which contain individually identifiable information, the disclosure of which is prohibited by the Privacy Act or regulations established thereunder, and who knowing that disclosure of the specific material is so prohibited, willfully discloses the material in any manner to any person or agency not entitled to receive it, shall be guilty of a misdemeanor and fined not more than $5,000. (4) Granting a contractor access to FTI must be preceded by certifying that each officer or employee understands the agency’s security policy and procedures for safeguarding FTI. A contractor and each officer or employee must maintain their authorization to access FTI through annual recertification of their understanding of the agency’s security policy and procedures for safeguarding FTI. The initial certification and recertifications must be documented and placed in the agency's files for review. As part of the certification and at least annually afterwards, a contractor and each officer or employee must be advised of the provisions of IRC sections 7213, 7213A, and 7431 (see Exhibit 4, Sanctions for Unauthorized Disclosure, and Exhibit 5, Civil Damages for Unauthorized Disclosure). The training on the agency’s security policy and procedures provided before the initial certification and annually thereafter must also cover the incident response policy and procedure for reporting unauthorized disclosures and data breaches. (See Section 10) For the initial certification and the annual recertifications, the contractor and each officer or employee must sign, either with ink or electronic signature, a confidentiality statement certifying their understanding of the security requirements. III. INSPECTION The IRS and the Agency, with 24-hour notice, shall have the right to send its inspectors into the offices and plants of the contractor to inspect facilities and operations performing any work with FTI under this contract for compliance with requirements defined in IRS Publication 1075. The IRS’ right of inspection shall include the use of manual and/or automated scanning tools to perform compliance and vulnerability assessments of information technology (IT) assets that access, store, process or transmit FTI. Based on the inspection, corrective actions may be required in cases where the contractor is found to be noncompliant with FTI safeguard requirements. IRS Publication 1075 (Rev. 11/2021) Section 2.C.8, Control over Processing through 2.C.9, Service Level Agreements (SLA) 2.C.8 Controls Over Processing 163
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The agency must establish adequate controls to prevent disclosing FTI to other state agencies, tax or non-tax, or to political subdivisions, such as cities or counties, for any purpose, including tax administration, absent explicit written IRS authority granted under IRC § 6103(p)(2)(B). Processing of FTI in an electronic media format including removable media, microfilms, photo impressions or the conversion to other formats (including tape reformatting or duplication, reproduction or conversion to digital images or hard copy printout) will be performed as indicated in the environments listed in 2.C.8.1 and 2.C.8.2. 2.C.8.1 Agency-owned and Operated Facility Processing under this method will take place in a manner that will protect the confidentiality of the information on the electronic media. All safeguards outlined in this publication also must be followed and will be subject to IRS safeguard reviews. 2.C.8.2 Agency, Contractor or Sub-Contractor Shared Facilities Recipients of FTI are permitted to use a shared facility but only in a manner that does not allow access to FTI by employees, agents, representatives, or contractors of other agencies using the shared facility. For purposes of applying sections 6103(l), (m) and (n), the term “agent” includes contractors and subcontractors. Access restrictions pursuant to the IRC authority by which the FTI is received continue to apply; for example, human services agencies administering benefit eligibility programs may not allow contractors or sub-contractors, including consolidated data center contractors, access to any FTI. The agency must include, as appropriate, the requirements specified in Exhibit 7, Safeguarding Contract Language. The agency, as well as its contractor, sub-contractor and shared sites that receive, process, store, access, protect and/or transmit FTI, are subject to Safeguard reviews. These requirements also apply to releasing electronic media to a private contractor, sub-contractor or other agency office, even if the purpose is merely to erase the old media for reuse. 2.C.9 Service Level Agreements (SLA) Agencies using support functions, including, but not limited to, consolidated data centers, shared print facilities, and disaster recovery sites, must implement appropriate controls to ensure the protection of FTI. This includes a service level agreement (SLA) between the agency authorized to receive FTI and support functions. The SLA must cover the following: The agency with authority to receive FTI is responsible for ensuring the protection of all FTI received. The state support function shares responsibility for safeguarding FTI. The Exhibit 7 language must be included in the SLA between the recipient agency and support functions and in all contracts involving contractors or sub-contractors hired by the state support function. 164
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The SLA provides written notification to the state support function’s management that they are bound by the provisions of Publication 1075, relative to protecting all FTI within their possession or control. The SLA shall detail the IRS’s right to inspect state support function facilities and operations receiving, processing, storing, accessing, protecting and/or transmitting FTI under this agreement to assess compliance with requirements defined in IRS Publication 1075. The SLA shall specify that IRS’s right of inspection includes the use of manual and/or automated scanning tools to perform compliance and vulnerability assessments of information technology (IT) assets that access, store, process or transmit FTI. The SLA shall detail the state support function’s responsibilities to address corrective action recommendations to resolve findings of noncompliance identified by IRS inspections. The agency will conduct an internal inspection of the state support function every 18 months, as described in Section 2.D.3, Internal Inspections. Multiple agencies sharing a state support function such as a consolidated data center may partner together to conduct a single, comprehensive internal inspection. However, care must be taken to ensure agency representatives do not gain unauthorized access to other agencies’ FTI during the internal inspection. The employees from the state support function with access to or use of FTI, including system administrators and programmers, must: 1. Meet the background check requirements defined in Background Investigation Minimum Requirements and 2. Receive disclosure awareness training and sign a confidentiality statement, prior to initial access to or use of FTI, as well as annually thereafter. These provisions also extend to any contractors or sub-contractors hired by the state support function that have authorized access to or use of FTI. The specific data breach incident reporting procedures for all state support function employees, contractors and sub-contractors must be covered. The required disclosure awareness training must include a review of these procedures. Responsibilities must be identified for coordination of the 45-day notification of the use of contractors or sub-contractors with access to FTI. Require a formal sanction process for individuals covered by the SLA for failing to comply with established FTI security policies and procedures. Notification of designated agency personnel is required within 72 hours when the formal sanction is a proposed disciplinary or adverse action involving an unauthorized access or disclosure of FTI and must include the date the unauthorized access or disclosure of FTI occurred. 165
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Generally, consolidated data centers are operated either by a separate state agency (e.g., Department of Information Services) or by a private contractor or sub-contractor. If an agency is considering transitioning to either a state-owned or private vendor consolidated data center, the Office of Safeguards strongly suggests the agency submit a request for discussions with Safeguards as early as possible in the decision making or implementation planning process. The purpose of these discussions is to ensure the agency remains compliant with safeguarding requirements during the transition to the consolidated data center. Disclosure awareness training videos produced by the IRS can be found at: https://www.irs.gov/privacy-disclosure/irs-disclosure-awareness-videos REFERENCES 26 U.S.C. §6103(n) Confidentiality and disclosure of returns and return information (n) Certain other Persons Pursuant to regulations prescribed by the Secretary, returns and return information may be disclosed to any person, including any person described in section 7513(a), to the extent necessary in connection with the processing, storage, transmission, and reproduction of such returns and return information, the programming, maintenance, repair, testing, and procurement of equipment, and the providing of other services, for purposes of tax administration.26 C.F.R. §301.6103(n)-1 Disclosure of returns and return information in connection with written contracts or agreements for the acquisition of property or services for tax administration purposes. (a) General rule. (1) Pursuant to the provisions of section 6103(n) of the Internal Revenue Code and subject to the conditions of this section, officers and employees of the Treasury Department, a State tax agency, the Social Security Administration, or the Department of Justice, are authorized to disclose returns and return information (as defined in section 6103(b)) to any person (including, in the case of the Treasury Department, any person described in section 7513(a)), or to an officer or employee of the person, for purposes of tax administration (as defined in section 6103(b)(4)), to the extent necessary in connection with a written contract or agreement for the acquisition of - (i) Equipment or other property; or (ii) Services relating to the processing, storage, transmission, or reproduction of returns or return information, the programming, maintenance, repair, or testing of equipment or other property, or the providing of other services. (2) Any person, or officer or employee of the person, who receives returns or return information under paragraph (a)(1) of this section, may - (i) Further disclose the returns or return information to another officer or employee of the person whose duties or responsibilities require the returns or return information for a purpose described in this paragraph (a); or 166
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(ii) Further disclose the returns or return information, when authorized in writing by the Internal Revenue Service (IRS), to the extent necessary to carry out the purposes described in this paragraph (a). Disclosures may include disclosures to an agent or subcontractor of the person, or officer or employee of the agent or subcontractor.(3)An agent or subcontractor, or officer or employee of the agent or subcontractor, who receives returns or return information under paragraph (a)(2)(ii) of this section, may further disclose the returns or return information to another officer or employee of the agent or subcontractor whose duties or responsibilities require the returns or return information for a purpose described in this paragraph (a). (4) Any person, or officer, employee, agent or subcontractor of the person, or officer or employee of the agent or subcontractor, who receives returns or return information under this paragraph (a), may, subject to the provisions of § 301.6103(p)(2)(B)-1 (concerning disclosures by a Federal, State, or local agency, or its agents or contractors), further disclose the returns or return information for a purpose authorized, and subject to all applicable conditions imposed, by section 6103.(b) Limitations. (1) Disclosure of returns or return information in connection with a written contract or agreement for the acquisition of property or services described in paragraph (a) of this section will be treated as necessary only if the performance of the contract or agreement cannot otherwise be reasonably, properly, or economically carried out without the disclosure. (2) Disclosure of returns or return information in connection with a written contract or agreement for the acquisition of property or services described in paragraph (a) of this section shall be made only to the extent necessary to reasonably, properly, or economically perform the contract. For example, disclosure of returns or return information to employees of a contractor for purposes of programming, maintaining, repairing, or testing computer equipment used by the IRS or a State tax agency shall be made only if the services cannot be reasonably, properly, or economically performed without the disclosure. If it is determined that disclosure of returns or return information is necessary, and if the services can be reasonably, properly, or economically performed by disclosure of only parts or portions of a return or if deletion of taxpayer identity information (as defined in section 6103(b)(6)) reflected on a return would not seriously impair the ability of the employees to perform the services, then only the parts or portions of the return, or only the return with taxpayer identity information deleted, may be disclosed. (c) Penalties. Any person, or officer, employee, agent or subcontractor of the person, or officer or employee of the agent or subcontractor, who receives returns or return information under paragraph (a) of this section, is subject to the civil and criminal penalty provisions of sections 7431, 7213, and 7213A for the unauthorized inspection or disclosure of the returns or return information. (d) Notification requirements. Any person, or agent or subcontractor of the person, who receives returns or return information under paragraph (a) of this section shall provide written notice to his, her, or its officers and employees receiving the returns or return information that - 167
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(1)Returns or return information disclosed to the officer or employee may be used only for a purpose and to the extent authorized by paragraph (a) of this section and that the officer or employee is subject to the civil and criminal penalty provisions of sections 7431, 7213, and 7213A for the unauthorized inspection or disclosure of the returns or return information; (2) Further inspection of any returns or return information for a purpose or to an extent not authorized by paragraph (a) of this section constitutes a misdemeanor, punishable upon conviction by a fine of as much as $1,000, or imprisonment for as long as 1 year, or both, together with costs of prosecution; (3) Further disclosure of any returns or return information for a purpose or to an extent not authorized by paragraph (a) of this section constitutes a felony, punishable upon conviction by a fine of as much as $5,000, or imprisonment for as long as 5 years, or both, together with the costs of prosecution;(4) Further inspection or disclosure of returns or return information by any person who is not an officer or employee of the United States for a purpose or to an extent not authorized by paragraph (a) of this section may result also in an award of civil damages against that person in an amount not less than $1,000 for each act of unauthorized inspection or disclosure; or the sum of actual damages sustained by the plaintiff as a result of the unauthorized inspection or disclosure plus, in the case of a willful inspection or disclosure or an inspection or disclosure that is the result of gross negligence, punitive damages. In addition, costs and reasonable attorneys fees may be awarded; and (5) A conviction for an offense referenced in paragraph (d)(2) or (3) of this section shall, in addition to any other punishment, result in dismissal from office or discharge from employment if the person convicted is an officer or employee of the United States. (e) Safeguards. (1) Any person, or agent or subcontractor of the person, who may receive returns or return information under paragraph (a) of this section, shall agree, before disclosure of any returns or return information to the person, agent, or subcontractor, to permit an inspection by the IRS of his, her, or its site or facilities.(2) Any person, or officer, employee, agent or subcontractor of the person, or officer or employee of the agent or subcontractor, who receives returns or return information under paragraph (a) of this section, shall comply with all applicable conditions and requirements as the IRS may prescribe from time to time (prescribed requirements) for the purposes of protecting the confidentiality of returns and return information and preventing any disclosure or inspection of returns or return information in a manner not authorized by this section. (3) The terms of any written contract or agreement for the acquisition of property or services as described in paragraph (a) of this section shall provide, or shall be amended to provide, that any person, or officer, employee, agent or subcontractor of the person, or officer or employee of the agent or subcontractor, who receives returns or return information under paragraph (a) of this section, shall comply with the prescribed requirements. Any contract or agreement shall be made available to the IRS before execution of the contract or agreement. For purposes of this paragraph (e)(3), a written contract or agreement shall include any contract or agreement 168
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between a person and an agent or subcontractor of the person to provide the property or services described in paragraph (a) of this section. (4) If the IRS determines that any person, or officer, employee, agent or subcontractor of the person, or officer or employee of the agent or subcontractor, who receives returns or return information under paragraph (a) of this section, has failed to, or does not, satisfy the prescribed requirements, the IRS, consistent with the regulations under section 6103(p)(7), may take any actions it deems necessary to ensure that the prescribed requirements are or will be satisfied, including - (i) Suspension of further disclosures of returns or return information by the IRS to the State tax agency, the Social Security Administration, or the Department of Justice, until the IRS determines that the conditions and requirements have been or will be satisfied; (ii) Suspension of further disclosures by the Treasury Department otherwise authorized by paragraph (a) of this section; and (iii)Suspension or termination of any duty or obligation arising under a contract or agreement with the Treasury Department. (f)Definitions. For purposes of this section - (1) The term Treasury Department includes the IRS, the Office of the Chief Counsel for the IRS, and the Office of the Treasury Inspector General for Tax Administration; (2) The term State tax agency means an agency, body, or commission described in section 6103(d); and (3) The term Department of Justice includes offices of the United States Attorneys. (g) Effective date. This section is applicable on June 5, 2007. 26 U.S.C. §7213. Unauthorized disclosure of information (a) Returns and return information (1) Federal employees and other persons It shall be unlawful for any officer or employee of the United States or any person described in section 6103(n) (or an officer or employee of any such person), or any former officer or employee, willfully to disclose to any person, except as authorized in this title, any return or return information (as defined in section 6103(b)). Any violation of this paragraph shall be a felony punishable upon conviction by a fine in any amount not exceeding $5,000, or imprisonment of not more than 5 years, or both, together with the costs of prosecution, and if such offense is committed by any officer or employee of the United States, he shall, in addition to any other punishment, be dismissed from office or discharged from employment upon conviction for such offense. (2) State and other employees 169
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It shall be unlawful for anyperson(not described in paragraph (1)) willfully to disclose to any person, except as authorized in this title, any return or return information (as defined insection 6103(b)) acquired by him or anotherpersonunder subsection (d), (i)(1)(C), (3)(B)(i), or (7)(A)(ii), (k)(10), (13), (14), or (15), (l)(6), (7), (8), (9), (10), (12), (15), (16), (19), (20), or (21) or (m)(2), (4), (5), (6), or (7) of section 6103 or under section 6104(c). Any violation of this paragraph shall be a felony punishable by a fine in any amount not exceeding $5,000, or imprisonment of not more than 5 years, or both, together with the costs of prosecution. (3) Other persons It shall be unlawful for any personto whom any return or return information (as defined in section 6103(b)) is disclosed in a manner unauthorized by this title thereafter willfully to print or publish in any manner not provided by law any such return or return information. Any violation of this paragraph shall be a felony punishable by a fine in any amount not exceeding $5,000, or imprisonment of not more than 5 years, or both, together with the costs of prosecution. (4) Solicitation It shall be unlawful for any personwillfully to offer any item of material value in exchange for any return or return information (as defined in section 6103(b)) and to receive as a result of such solicitation any such return or return information. Any violation of this paragraph shall be a felony punishable by a fine in any amount not exceeding $5,000, or imprisonment of not more than 5 years, or both, together with the costs of prosecution. (5) Shareholders It shall be unlawful for any person to whom a return or return information (as defined in section 6103(b)) is disclosed pursuant to the provisions of section 6103(e)(1)(D)(iii) willfully to disclose such return or return information in any manner not provided by law. Any violation of this paragraph shall be a felony punishable by a fine in any amount not to exceed $5,000, or imprisonment of not more than 5 years, or both, together with the costs of prosecution. (b) Disclosure of operations of manufacturer or producer Any officer or employee of the United States who divulges or makes known in any manner whatever not provided by law to any personthe operations, style of work, or apparatus of any manufacturer or producer visited by him in the discharge of his official duties shall be guilty of a misdemeanor and, upon conviction thereof, shall be fined not more than $1,000, or imprisoned not more than 1 year, or both, together with the costs of prosecution; and the offender shall be dismissed from office or discharged from employment. (c) Disclosures by certain delegates of Secretary All provisions of law relating to the disclosure of information, and all provisions of law relating to penalties for unauthorized disclosure of information, which are applicable in respect of any function under this title when performed by an officer or employee of the Treasury Department 170
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are likewise applicable in respect of such function when performed by anypersonwho is a “delegate” within the meaning of section 7701(a)(12)(B). (d) Disclosure of software Any person who willfully divulges or makes known software (as defined in section 7612(d)(1)) to anyperson in violation of section 7612 shall be guilty of a felony and, upon conviction thereof, shall be fined not more than $5,000, or imprisoned not more than 5 years, or both, together with the costs of prosecution. (e) Cross references (1) Penalties for disclosure of information by preparers of returns For penalty for disclosure or use of information by preparers of returns, see section 7216. (2) Penalties for disclosure of confidential information For penalties for disclosure of confidential information by any officer or employee of the United States or any department or agency thereof, see 18 U.S.C. 1905. 26 U.S.C. §7213A. Unauthorized inspection of returns or return information (a) Prohibitions (1) Federal employees and other persons It shall be unlawful for— (A) any officer or employee of the United States, or (B) any person described in subsection (l)(18) or (n) of section 6103or an officer or employee of any such person, willfully to inspect, except as authorized in this title, any return or return information. (2) State and other employees It shall be unlawful for any person (not described in paragraph (1)) willfully to inspect, except as authorized in this title, anyreturn or return information acquired by such person or anotherperson under a provision of section 6103referred to in section 7213(a)(2) or under section 6104(c). (b) Penalty (1) In general Any violation of subsection (a) shall be punishable upon conviction by a fine in any amount not exceeding $1,000, or imprisonment of not more than 1 year, or both, together with the costs of prosecution. 171
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(2) Federal officers or employeesAn officer or employee of the United States who is convicted of any violation of subsection (a) shall, in addition to any other punishment, be dismissed from office or discharged from employment. (c) Definitions For purposes of this section, the terms “inspect”, “return”, and “return information” have the respective meanings given such terms by section 6103(b).26 U.S.C. §7431. Civil damages for unauthorized inspection or disclosure of returns and return information (a) In general (1) Inspection or disclosure by employee of United States If any officer or employee of the United States knowingly, or by reason of negligence, inspects or discloses any return or return information with respect to a taxpayer in violation of any provision of section 6103, such taxpayer may bring a civil action for damages against the United States in a district court of the United States. (2) Inspection or disclosure by a person who is not an employee of United States If any person who is not an officer or employee of the United States knowingly, or by reason of negligence, inspects or discloses any return or return information with respect to a taxpayer in violation of any provision of section 6103 or in violation of section 6104(c), such taxpayer may bring a civil action for damages against such person in a district court of the United States. (b) Exceptions No liability shall arise under this section with respect to any inspection or disclosure— (1) which results from a good faith, but erroneous, interpretation of section 6103, or (2) which is requested by the taxpayer. (c) Damages In any action brought under subsection (a), upon a finding of liability on the part of the defendant, the defendant shall be liable to the plaintiff in an amount equal to the sum of— (1) the greater of— (A) $1,000 for each act of unauthorized inspection or disclosure of a return or return information with respect to which such defendant is found liable, or (B) the sum of— (i) the actual damages sustained by the plaintiff as a result of such unauthorized inspection or disclosure, plus 172
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(ii) in the case of a willfulinspectionor disclosure or aninspectionor disclosure which is the result of gross negligence, punitive damages, plus (2) the costs of the action, plus (3) in the case of a plaintiff which is described in section 7430(c)(4)(A)(ii), reasonable attorneys fees, except that if the defendant is the United States, reasonable attorneys fees may be awarded only if the plaintiff is the prevailing party (as determined under section 7430(c)(4)). (d) Period for bringing action Notwithstanding any other provision of law, an action to enforce any liability created under this section may be brought, without regard to the amount in controversy, at any time within 2 years after the date of discovery by the plaintiff of the unauthorized inspection or disclosure. (e) Notification of unlawful inspection and disclosure. If any person is criminally charged by indictment or information with inspection or disclosure of a taxpayer’s return or return information in violation of— (1) paragraph (1) or (2) of section 7213(a), (2) section 7213A(a), or (3) subparagraph (B) of section 1030(a)(2) of title 18, United States Code, the Secretary shall notify such taxpayer as soon as practicable of such inspection or disclosure. The Secretary shall also notify such taxpayer if the Internal Revenue Service or a Federal or State agency (upon notice to the Secretary by such Federal or State agency) proposes an administrative determination as to disciplinary or adverse action against an employee arising from the employee’s unauthorized inspection or disclosure of the taxpayer’s return or return information.The notice described in this subsection shall include the date of the unauthorizedinspection or disclosure and the rights of the taxpayer under such administrative determination. (f) Definitions For purposes of this section, the terms “inspect”, “inspection”, “return”, and “return information” have the respective meanings given such terms by section 6103(b). (g) Extension to information obtained under section 3406For purposes of this section— (1) any information obtained under section 3406(including information with respect to any payee certification failure under subsection (d) thereof) shall be treated as return information, and (2) any inspectionor use of such information other than for purposes of meeting any requirement under section 3406or (subject to the safeguards set forth in section 6103) for purposes permitted under section 6103 shall be treated as a violation of section 6103. For purposes of subsection (b), the reference to section 6103 shall be treated as including a reference to section 3406. (h) Special rule for information obtained under section 6103(k)(9) 173
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For purposes of this section, any reference to section 6103shall be treated as including a reference to section 6311(e). 174
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ATTACHMENT 1HIPAA BUSINESS ASSOCIATE AGREEMENT If Customer is a Covered Entity or a Business Associate and includes Protected Health Information in Customer Data or FastTrack Data, execution of a license agreement that includes the Online Services Terms (“Agreement”) will incorporate the terms of this HIPAA Business Associate Agreement (“BAA”) into that Agreement. If there is any conflict between a provision in this BAA and a provision in the Agreement, this BAA will control. 1. Definitions. Except as otherwise defined in this BAA, capitalized terms shall have the definitions set forth in HIPAA, and if not defined by HIPAA, such terms shall have the definitions set forth in the Agreement. “Breach Notification Rule” means the Breach Notification for Unsecured Protected Health Information Final Rule. “Business Associate” shall have the same meaning as the term “business associate” in 45 CFR § 160.103 of HIPAA. “Covered Entity” shall have the same meaning as the term “covered entity” in 45 CFR § 160.103 of HIPAA. “Customer”, for this BAA only, means Customer and its Affiliates. “FastTrack Data” means all data, including all text, sound, video, or image files, and software, that are provided to Microsoft by or on behalf of Customer for Microsoft’s performance of the FastTrack Services. “FastTrack Services” means the onboarding and migration services for Office 365 Services specified as being in scope for this BAA on the FastTrack Center BAA site at http://aka.ms/FastTrackBAA (or successor site) that are provided to Customer by Microsoft in connection with Customer’s subscription for Office 365 Services, excluding services that are performed using third-party software or software that is not hosted by Microsoft. “HIPAA” collectively means the administrative simplification provision of the Health Insurance Portability and Accountability Act enacted by the United States Congress, and its implementing regulations, including the Privacy Rule, the Breach Notification Rule, and the Security Rule, as amended from time to time, including by the Health Information Technology for Economic and Clinical Health (“HITECH”) Act and by the Modifications to the HIPAA Privacy, Security, Enforcement, and Breach Notification Rules under the Health Information Technology for Economic and Clinical Health Act and the Genetic Information Nondiscrimination Act; Other Modifications to the HIPAA Rules; Final Rule. “Microsoft Online Services”, for this BAA only, means Office 365 Services, Microsoft Azure Core Services, Microsoft Dynamics 365 Core Services, Microsoft Intune Online Services, Microsoft Power Platform Core Services, and/or Microsoft Cloud App Security, each as defined in the “Data Protection Terms” section of the Online Services Terms incorporated into the Agreement; Microsoft Healthcare Bot; and any additional Azure online services and U.S. Government online services listed as in scope for this BAA on the Microsoft Trust Center at https://www.microsoft.com/en-us/trustcenter/Compliance/HIPAA (or successor site); excluding Previews. “Privacy Rule” means the Standards for Privacy of Individually Identifiable Health Information. 175
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“Protected Health Information” shall have the same meaning as the term “protected health information” in 45 CFR § 160.103 of HIPAA, provided that it is limited to such protected health information that is received by Microsoft from, or created, received, maintained, or transmitted by Microsoft on behalf of, Customer (a) through the use of the Microsoft Online Services or (b) for Microsoft’s performance of the FastTrack Services. “Security Rule” means the Security Standards for the Protection of Electronic Protected Health Information. 2.Permitted Uses and Disclosures of Protected Health Information.a. Performance of the Agreement for Microsoft Online Services. Except as otherwise limited in this BAA, Microsoft may Use and Disclose Protected Health Information for, or on behalf of, Customer as specified in the Agreement; provided that any such Use or Disclosure would not violate HIPAA if done by Customer, unless expressly permitted under paragraph b of this Section. b. Management, Administration, and Legal Responsibilities. Except as otherwise limited in this BAA, Microsoft may Use and Disclose Protected Health Information for the proper management and administration of Microsoft and/or to carry out the legal responsibilities of Microsoft, provided that any Disclosure may occur only if: (1) Required by Law; or (2) Microsoft obtains written reasonable assurances from the person to whom the Protected Health Information is Disclosed that it will be held confidentially and Used or further Disclosed only as Required by Law or for the purpose for which it was Disclosed to the person, and the person notifies Microsoft of any instances of which it becomes aware in which the confidentiality of the Protected Health Information has been breached. 3. Responsibilities of the Parties with Respect to Protected Health Information. a. Microsoft’s Responsibilities. To the extent Microsoft is acting as a Business Associate, Microsoft agrees to the following: (i) Limitations on Use and Disclosure. Microsoft shall not Use and/or Disclose the Protected Health Information other than as permitted or required by the Agreement and/or this BAA or as otherwise Required by Law. Microsoft shall not disclose, capture, maintain, scan, index, transmit, share or Use Protected Health Information for any activity not authorized under the Agreement and/or this BAA. Neither Microsoft Online Services nor FastTrack Services shall use Protected Health Information for any advertising, Marketing or other commercial purpose of Microsoft or any third party. Microsoft shall not violate the HIPAA prohibition on the sale of Protected Health Information. Microsoft shall make reasonable efforts to Use, Disclose, and/or request the minimum necessary Protected Health Information to accomplish the intended purpose of such Use, Disclosure, or request. (ii) Safeguards. Microsoft shall: (1) use reasonable and appropriate safeguards to prevent inappropriate Use and Disclosure of Protected Health Information other than as provided for in this BAA; and (2) comply with the applicable requirements of 45 CFR Part 164 Subpart C of the Security Rule. 176
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(iii)Reporting.Microsoft shall report to Customer: (1) any Use and/or Disclosure ofProtected Health Information that is not permitted or required by this BAA of which Microsoft becomes aware; (2) any Security Incident of which it becomes aware, provided that notice is hereby deemed given for Unsuccessful Security Incidents and no further notice of such Unsuccessful Security Incidents shall be given; and/or (3) any Breach of Customer’s Unsecured Protected Health Information that Microsoft may discover (in accordance with 45 CFR § 164.410 of the Breach Notification Rule). Notification of a Breach will be made without unreasonable delay, but in no event more than five (5) business days after Microsoft’s determination of a Breach. Taking into account the level of risk reasonably likely to be presented by the Use, Disclosure, Security Incident, or Breach, the timing of other reporting will be made consistent with Microsoft’s and Customer’s legal obligations. For purposes of this Section, “Unsuccessful Security Incidents” mean, without limitation, pings and other broadcast attacks on Microsoft’s firewall, port scans, unsuccessful log-on attempts, denial of service attacks, and any combination of the above, as long as no such incident results in unauthorized access, acquisition, Use, or Disclosure of Protected Health Information. Notification(s) under this Section, if any, will be delivered to contacts identified by Customer pursuant to Section 3b(ii) (Contact Information for Notices) of this BAA by any means Microsoft selects, including through e-mail. Microsoft’s obligation to report under this Section is not and will not be construed as an acknowledgement by Microsoft of any fault or liability with respect to any Use, Disclosure, Security Incident, or Breach. (iv) Subcontractors. In accordance with 45 CFR §§ 164.502(e)(1)(ii) and 164.308(b)(2) of HIPAA, Microsoft shall require its Subcontractors who create, receive, maintain, or transmit Protected Health Information on behalf of Microsoft to agree in writing to: (1) the same or more stringent restrictions and conditions that apply to Microsoft with respect to such Protected Health Information; (2) appropriately safeguard the Protected Health Information; and (3) comply with the applicable requirements of 45 CFR Part 164 Subpart C of the Security Rule. Microsoft remains responsible for its Subcontractors’ compliance with obligations in this BAA. (v) Disclosure to the Secretary. Microsoft shall make available its internal practices, records, and books relating to the Use and/or Disclosure of Protected Health Information received from Customer to the Secretary of the Department of Health and Human Services for purposes of determining Customer’s compliance with HIPAA, subject to attorney-client and other applicable legal privileges. Microsoft shall respond to any such request from the Secretary in accordance with the Section titled “Disclosure of Customer Data” in the Agreement. (vi) Access. If Microsoft maintains Protected Health Information in a Designated Record Set for Customer, then Microsoft, at the request of Customer, shall within fifteen (15) days make access to such Protected Health Information available to Customer in accordance with 45 CFR § 164.524 of the Privacy Rule. (vii) Amendment. If Microsoft maintains Protected Health Information in a Designated Record Set for Customer, then Microsoft, at the request of 177
STATE OF CALIFORNIA SHI INTERNATIONAL CORP. DEPARTMENT OF TECHNOLOGY PO 25-0198737/ SC 25-0198737

Customer, shall within fifteen (15) days make available such Protected Health Information to Customer for amendment and incorporate any reasonably requested amendment in the Protected Health Information in accordance with 45 CFR § 164.526 of the Privacy Rule. (viii) Accounting of Disclosure. Microsoft, at the request of Customer, shall within fifteen (15) days make available to Customer such information relating to Disclosures made by Microsoft as required for Customer to make any requested accounting of Disclosures in accordance with 45 CFR § 164.528 of the Privacy Rule. (viii)Performance of a Covered Entity’s Obligations. To the extent Microsoft is to carry out a Covered Entity obligation under the Privacy Rule, Microsoft shall comply with the requirements of the Privacy Rule that apply to Customer in the performance of such obligation. b. Customer Responsibilities. (i) No Impermissible Requests. Customer shall not request Microsoft to Use or Disclose Protected Health Information in any manner that would not be permissible under HIPAA if done by a Covered Entity (unless permitted by HIPAA for a Business Associate). (ii) Contact Information for Notices. Customer hereby agrees that any reports, notification, or other notice by Microsoft pursuant to this BAA may be made electronically. Customer shall provide contact information as follows (or as Microsoft may specify from time to time): (1) the Azure Security Center for Microsoft Azure Core Services, (2) [email protected] for other Azure or U.S. Government online services in scope for this BAA, and (3) the Message Center in the Admin Center for other Microsoft Online Services. Contact information (a) for Microsoft Azure Core Services must include the security contact information required on the Azure Security Center, (b) for other Azure or U.S. Government online services in scope for this BAA must include name of individual(s) to be contacted, title of individual(s) to be contacted, e-mail address of individual(s) to be contacted, name of Customer organization, and, if available, Customer’s contract number, subscriber identification number, and Microsoft Online Direct Routing Domain (MODRD) (e.g. “contoso.onmicrosoft.com”), and (c) for other Microsoft Online Services must include information required for the Message Center Privacy reader role in the Admin Center. Customer shall ensure that such contact information remains up to date during the term of this BAA. Failure to submit and maintain as current the aforementioned contact information may delay Microsoft’s ability to provide Breach notification under this BAA. (iii) Safeguards and Appropriate Use of Protected Health Information. Customer is responsible for implementing appropriate privacy and security safeguards to protect its Protected Health Information in compliance with HIPAA. Without limitation, it is Customer’s obligation to: 1) Not include Protected Health Information in: (1) information Customer submits to technical support personnel through a technical support request or to community support forums; and (2) Customer’s address book or 178
STATE OF CALIFORNIA SHI INTERNATIONAL CORP. DEPARTMENT OF TECHNOLOGY PO 25-0198737/ SC 25-0198737

directory information. In addition, Microsoft does not act as, or have the obligations of, a Business Associate under HIPAA with respect to Customer Data or FastTrack Data once it is sent to or from Customer outside Microsoft Online Services or FastTrack Services over the public Internet, or if Customer fails to follow applicable instructions regarding physical media transported by a common carrier. 2) Implement privacy and security safeguards in the systems, applications, and software Customer controls, configures, and uploads into the Microsoft Online Services or uses in connection with the FastTrack Services. 4.Applicability of BAA.This BAA is applicable to Microsoft Online Services and FastTrack Services. Microsoft may, from time to time, (a) include additional Microsoft online services on the Microsoft Trust Center and/or in the “Data Protection Terms” section of the Online Services Terms incorporated into the Agreement or additional FastTrack Services on the FastTrack Center BAA site, and (b) update the definition of Microsoft Online Services and FastTrack Services in this BAA accordingly, and such updated definitions will apply to Customer without additional action by Customer. It is Customer’s obligation to not store or process in an online service, or provide to Microsoft for performance of a professional service, protected health information (as that term is defined in 45 CFR § 160.103 of HIPAA) until this BAA is effective as to the applicable service. 5. Term and Termination. a. Term. This BAA shall continue in effect until the earlier of (1) termination by a Party for breach as set forth in Section 5b, below, or (2) expiration of Customer’s Agreement. b. Termination for Breach. Upon written notice, either Party immediately may terminate the Agreement and this BAA if the other Party is in material breach or default of any obligation in this BAA. Either party may provide the other a thirty (30) calendar day period to cure a material breach or default within such written notice. c. Return, Destruction, or Retention of Protected Health Information Upon Termination. Upon expiration or termination of this BAA, Microsoft shall return or destroy all Protected Health Information in its possession, if it is feasible to do so, and as set forth in the applicable termination provisions of the Agreement. If it is not feasible to return or destroy any portions of the Protected Health Information upon termination of this BAA, then Microsoft shall extend the protections of this BAA, without limitation, to such Protected Health Information and limit any further Use or Disclosure of the Protected Health Information to those purposes that make the return or destruction infeasible for the duration of the retention of the Protected Health Information. 6. Miscellaneous. a. Interpretation. The Parties intend that this BAA be interpreted consistently with their intent to comply with HIPAA and other applicable federal and state law. Except where this BAA conflicts with the Agreement, all other terms and conditions of the 179
STATE OF CALIFORNIA SHI INTERNATIONAL CORP. DEPARTMENT OF TECHNOLOGY PO 25-0198737/ SC 25-0198737

Agreement remain unchanged. Any captions or headings in this BAA are for the convenience of the Parties and shall not affect the interpretation of this BAA. b.BAAs; Waiver.This BAA may not be modified or amended except in a writing duly signed by authorized representatives of the Parties. A waiver with respect to one event shall not be construed as continuing, as a bar to, or as a waiver of any right or remedy as to subsequent events. c. No Third-Party Beneficiaries. Nothing express or implied in this BAA is intended to confer, nor shall anything in this BAA confer, upon any person other than the Parties, and the respective successors or assigns of the Parties, any rights, remedies, obligations, or liabilities whatsoever. d. Severability. In the event that any provision of this BAA is found to be invalid or unenforceable, the remainder of this BAA shall not be affected thereby, but rather the remainder of this BAA shall be enforced to the greatest extent permitted by law. e. No Agency Relationship. It is not intended that an agency relationship (as defined under the Federal common law of agency) be established hereby expressly or by implication between Customer and Microsoft under HIPAA or the Privacy Rule, Security Rule, or Breach Notification Rule. No terms or conditions contained in this BAA shall be construed to make or render Microsoft an agent of Customer. 180
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LICENSED SUPPORT PROVIDER (LSP)
AGREEMENT No. ITARC-00929
For

MICROSOFT PRODUCTS AND SERVICES
UNDER MICROSOFT EA NO.8084445

BETWEEN

COUNTY OF RIVERSIDE
And
SHI INTERNATIONAL CORP.

This Agreement is entered between the COUNTY OF RIVERSIDE. a political subdivision olthe State of Califomia. (herein ref'ered to as "COUNTY"), and SHI lnternational Corp.. New.lersey corporation authorized to conduct business in the State of Calilornia (herein referred to as "LSP") of Microsoft Licensing Solution Provider. effective from November 01.2024 and continues in effect through October 31.2027, based on LSP's response to RFQ no. ITARC-532 for Microsoft products and services under Microsoft EA no. 8084445. The parties agree as follows:
l. All Terms and Conditions olthis Agreement No. ITARC-00929 shall govern purchase of Microsoft products and services under Microsoft EA no. 8084445 by County through the LSP.

2. Pcriod of Performance:

This Agreement shall be effective from November 0l .2024 and continues in effect through October

31.2027. with the option to renew for an additional three-year period expiring on October 3 l. 2030. rvith no obligation by the County of Riverside to purchase any specified amount ofgoods or services.

In addition. the County may at any time choose to transfer the enrollment f'rom one LSP to another LSP pursuant to the transfer terms set by Microsoft.
1'he period of performance for the enrollment with the LSP may be fbr up to a three-year term with the option to renew the enrollments with contracted LSP through the LSP contract expiration date.

Compensation
The COUNTY shall pay the LSP for products as stated in Exhibit A. incurred in accordance with the terms of this Agreement. The COUNTY is not responsible for any fees or costs incurred above or beyond the contracted amount and shall have no obligation to purchase any specified amount of services or products.

Non-Appropriations: The COUNTY obligation for payment olthis Agreement beyond the current fiscal year end is contingent upon and limited by the availability of COUNTY funding l'rom which payment can be made. and invoices shall be rendered "monthly" in arrears. In the State of California.

Government agencies are not allowed to pay excess interest and late charges. per Covemment Codes.

Section 926. I 0. No legal liability on the part of the COUNTY shall arise for payment beyond June 30 of each calendar year unless lunds are made available for such payment. In the event that such J
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iirnds are not forthcoming fbr any reason, COUNTY shall immediately notify CONTRACTOR in writing: and this Agreement shall be deemed terminated. have no f'urther force. and effect.

Hold Harmless/Indemnification:

4.1 LSP shall indemnily and hold harmless the County ol'Riverside. its Agencies. Districts, Special Districts and Departments. their respective directors. officers. Board of Supervisors. elected and appointed officials. employees. agents and representatives (individually and collectively hereinafter referred to as Indemnitees) from any Iiability, action, claim or damage whatsoever. based or asserted upon any services. or acts or omissions. of LSP. its officers. employees. subcontractor. agents or representatives arising out of or in any way relating to this Agreement. including but not limited to property damage. bodily injury, or death or any other element ofany kind or nature. t,SP shalldef'end the Indemnitees at its sole expense including all costs and fees (including. but not limited. to attorney fees. cost of investigation. defense and settlements or awards) in any clairn or action based upon such acts. omissions or services.

4.2 With respect to any action or claim sub.ject to indemnification herein by LSP. LSP shall. at their sole cost. have the right to use counsel oftheir own choice and shall have the right to adjust. settle. or compromise any such action or claim without the prior consent of County: provided. however. that any such ad-justment. settlernent or compromise in no manner whatsoever limits or circunrscribes LSP indemnification to lndemnitees as set tbrth herein. .1.3 LSP obligation hereunder shall be satisfled when LSP has provided to County the appropriate lonn of disrnissal relieving county fiom any liability for the action or claim involved.

Termination:

5.1 County may terminate this Agreement without cause upon thirty (30) days written notice served upon the LSP stating the extent and effective date of termination.

5.2 County may. upon five (5) days written notice terminate this Agreement for LSP default. if LSP ref'uses or fails to comply with the tenns of this Agreement or fails to make progress that may endanger performance and does not immediately cure such failure. In the event ofsuch termination. the County may proceed with the work in any manner deemed proper by County.

5.3 LSP rights under this Agreement shall tenninate (except for fees accrued prior to the date of termination) upon dishonesty or a willful or material breach of this Agreement by LSP: or in the event of LSP unwillingness or inability for any reason whatsoever to perform the terms of this Agreement.

Alteration or Changes to the Agreement
The Board of Supervisors and the County Purchasing Agent and/or his designee is the only authorized County representatives who may at any time. by written order. alter this Agreement. If any such alteration causes an increase or decrease in the cost of. or the time required for the performance under this Agreement. an equitable adjustment shall be made in the Agreement price or delivery schedule, or both, and the Agreement shall be modified by written amendment accord ingly.
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7. Notices
All correspondence and notices required or contemplated by this Agreement shall be delivered to the respective parties at the addresses set forth below and are deemed submitted two days after their deposit in the United States mail. postage prepaid:

LSP
SHI Intemational Corp.

Attn: Moitrayee Ma jumdar
290 Davidson Ave.

Somerset. NJ. 08873
Moitrayee Maj umdar@SH I.com
I nsu rance
Without lirniting or diminishing the LSP'S obligation to indemnify or hold the COUNTY harmless.

I-SP shall procure and maintain or cause to be maintained, at its sole cost and expense. the following insurance coverage's during the terrn of this Agreernent. As respects to the insurance section only. the COUNTY herein refers to the County of Riverside. its Agencies. Districts. Special Districts. and Departments. their respective directors. officers. Board of Supervisors. employees, elected or appointed ofTicials. agents. or representatives as Additional Insureds.

A. Workers' Compcnsation:
l1'the LSP has employees as defined by the State ol'Califbrnia. the LSP shall maintain statutory Workers' Compensation Insurance (Coverage A) as prescribed by the laws of the State of California. Policy shall include Ernployers'Liability (Coverage B) including Occupational Disease with limits not less than $1.000,000 per person per accident. The policy shall be endorsed to waive subrogation in lavor of The County of Riverside. Policy shall name the COUNTY as Additional Insureds.

B. Commercial General Liability:

Commercial Ceneral Liability insurance coverage. including but not limited to, premises liability. unmodified contractual liability. products and completed operations liability. personal and advertising injr"rry. and cross liability coverage. covering claims which may arise from or out of LSP'S pertbrmance of its obligations hereunder. Policy shall name the COUNTY as Additional Insured. Policy's limit of liability shall not be less than $2.000,000 per occurrence combined single limit. Ifsuch insurance contairrs a general aggregate Iirnit, it shall apply separately to this agreement or be no less than two (2) times the occurrence Iimit. Policy shall name the COUNTY as Additional lrrsureds.

C. Insurance Requirements for IT Contractor Services:

COUNTY
Riverside County Information Technology
Aun: Procuremerrt Contract Specialist
3450 l4'r' Street
Riverside. CA 92501
li
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t-SP shall procure and maintain for the duration ofthe contract insurance against claims lor injuries to person or damages to property which may arise lrom or in connection with the perfonnance of the work hereunder by the LSP. its agents. representatives. or employees. LSP shall procure and maintain for the duration ofthe contract insurance claims arising out oftheir services and including, but not limited to loss. damage. theft or other m isuse of data. infringement of intellectual property. invasion of privacy and breach of data.

Cyber Liability Insurance. with limits not less than $2.000.000 per occurrence or claim. $2.000,000 aggregate. Coverage shall be sufficiently broad to respond to the duties and obligations as is undertaken by LSP in this agreement and shall include. but not limited to" claims involving infringement of intellectual property. including but not limited to inlringement of copyright. trademark. trade dress. invasion of privacy violations. information theft. damage to or destruction of electronic information. release of private infonnation. alteration of electronic information. extortion and network security. The policy shall provide coverage for breach response costs as well as regulalory fines and penalties as well as credit monitoring expenses with limits sufficient to respond to these obligations.

If thc t,SP maintains broader coverage and/or higher Iimits than the minimums shown above. the County requires and shall be entitled to the broader coverage and/or higher limits maintained by the LSP. Any available insurance proceeds in excess ofthe specified minimum limits of insurance and coverage shall bc available to the County. Policy shall name the COUNTY as Additional Insureds.

D. General lnsurance Provisions - All lines:
l) Any insurance carrier providing insurance coverage hereunder shall be admitted to the State of California and have an A M BEST rating of not less than A: VIII (A:8) unless such requirements are waived, in writing. by the County Risk Manager. If the County's Risk Manager waives a requirement for a particular insurer such waiver is only valid for that specific insurer and only l'or one policy term.
2) The LSP must declare its insurance self'-insured retention for each coverage required herein.

Ilany such self-insured retention exceeds $500.000 per occurence each such retention shall have the prior written consent of the County Risk Manager before the commencement of operations under this Agreement. Upon notification of self-insured retention unacceptable to the COUNTY, and at the election of the Country's Risk Manager. LSP'S carriers shall either; I) reduce or eliminate such self'-insured retention as respects this Agreement with the COUNTY. or 2) procure a bond which guarantees payment of losses and related investigations, claims administration" and def'ense costs and expenses. 3) LSP shall cause LSP'S insurance carrier(s) to furnish the County of Riverside with either l) a properly executed original Certificate(s) of lnsurance and certified original copies of Endorsements eff'ecting coverage as required herein, and 2) if requested to do so orally or in writing by the County Risk Manager. provide original Certified copies of policies 4 Iir\ rsron lr0(,'l0l I
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including all Endorsements and all attachments thereto. showing such insurance is in full force and elTect. Further. said Certificate(s) and policies of insurance shall contain the covenant ofthe insurance carrier(s) that a minimum ofthirty (30) days written notice shall be given to the County of Riverside prior to any material modification. cancellation. expiration or reduclion in coverage of such insurance. If LSP insurance carrier(s) policies does not meet the minimum notice requirement found herein. LSP shall cause LSP's insurance carrier(s) to lurnish a 30 day Notice of Cancellation Endorsement. 4) ln the event ofa material modification. cancellation. expiration. or reduction in coverage. this Agreement shall terminate fbrthwith. unless the County of Riverside receives. prior to such effective date. another properly executed original Certificate of Insurance and original copies of endorsements or certified original policies. including all endorsements and attachments thereto evidencing coverage's set fbrth herein and the insurance required herein is in full lorce and effect. LSP shall not commence operations until the COUNTY has been fumished original Certificate (s) of lnsurance and certified original copies ofendorsements and if requested. certified original policies of insurance including all endorsements and any and all other attachments as required in this Section. An individual authorized by the insurance carrier to do so on its behalf shall sign the original endorsements for each policy and the Certit'icate of Insurance.
5) It is understood and agreed to by the parties hereto that the LSP's insurance shall be construed as primary insurance. and the COUNTY'S insurance and/or deductibles and/or self-insured retention's or self-insured programs shall not be construed as contributory. 6) lL during the term of this Agreement or any extension thereof. there is a material change in the scope ofservices: or. there is a material change in the equipment to be used in the performance olthe scope ofwork; or. the term of this Agreement. including any extensions thereof. exceeds five (5) years: the COUNTY reserves the right to adjust the types of insurance and the monetary limits of liability required under this Agreement, if in the County Risk Management's reasonable judgment. the amount or type ol insurance carried by the LSP has become inadequate.
7) LSP shall pass down the insurance obligations contained herein to alltiers of subcontractors working under this Agreement.
8) The insurance requirements contained in this Agreement may be met with a program(s) of self'-insurance acceptable to the COUNTY.
9) I.,SP agrees to nolify COUNTY of any claim by a third party or any incident or event that may give rise to a claim arising from the performance of this Agreement.

9. (leneral:

9.1 This Agreement, including any attachments or exhibits. constitutes the entire agreement ol the parties with respect to its subject matter and supersedes all prior and contemporaneous representations. proposals, discussions and communications, whether oral or in writing. This Agreemenl may be changed or modified only by a written amendment signed by authorized representatives of both parties.
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9.2 This Agreement shall be governed by the laws of the State of Califomia. Any legal action related to the performance or interpretation of this Agreement shall be filed only in the Superior Court oithe State of California located in Riverside, California, and the parties waive any provision of Iaw providing fbr a change of venue to another location. ln the event any provision in this Agreement is held by a courl of competent jurisdiction to be invalid. void. or unenforceable, the rernaining provisions will nevertheless continue in full force without being impaired or invalidated in any way.

9..1 'fhe fbllowing documents are attached to and incorporated into this Agreement:

Exhibit A: Scope and pricing.

Exhibit B: LSP Reporting of Active Enrollments.

Exhibit C: Microsoft LSP Participation Form.

Exhibit D: Microsoft EA Benefits for Government Agencies, Exhibit E: Microsoft Enterprise Agreements and Amendments.

El) Microsoft Enterprise Agreement No. 8084445.
tj2) Microsoli Select Plus Agreement No.7756479.

El) Amendments No. l- EA Custom Terms CTM (Document No. CTM-CPT-OPT-FWK) E4) Anlendments No. ?- EA Custom Terms (Document No. CTM-FWK-CTC-AGR). 9,4 In the event of any conflict or inconsistency between the tenns and conditions of this Agreement and any terms or conditions set forth in any of the attachments. purchase order(s). or other document relating to the transactions contemplated by this Agreement, the terms and conditions set lofth in this Agreement shall prevail.

9.5 This Agreement may be executed in any number of counterparts. each of which will be an original. but all of which together will constitute one instrument. Each party of this Agreement agrees to the use ofelectronic signatures. such as digital signatures that meet the requirements ofthe California Un iform Electronic Transactions Act (( "CUETA") Clal. Civ. Code dd I 633. I to I 633. I 7). fbr executing this Agreement. The parties further agree that the electronic signatures ofthe parties included in this Agreernent are intended to authenticate this writing and to have the same force and eil'ect as manual signatures. Electronic signature means an electronic sound. symbol. or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record pursuant to the CUETA as amended from time to time.

The CUETA authorizes use of an electronic signature for transactions and contracts among pafties in Califbrnia. including a government agency. Digital signature means an electronic identifier. created by computer. intended by the party using it to have the same force and effect as the use of a marrual signature. and shall be reasonably relied upon by the parties. For purposes of this section. a digital signature is a type of"electronic signature" as defined in subdivision (i) ofSection 1633.2 of the Civil Code.
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9.6 lf the entity is a corporation. the signatures of two corporate officers (the president, vice president. secretary. assistant secretary, Chief Financial Officer (i.e. treasurer), or assistant treasurer) are required on the agreements. The signatures must be in the following combination: president or vice president and secretary. treasurer or CFO. For example, the signatures ola president and a vice president would be insufficient. If signed by a single corporate officer, a corporate resolution. authorizing the one officer to bind the corporation. signed by the Board of Directors of the corporation, is required. The corporate resolution must authorize the signatory to sign agreements on behalf of the corporation.

If the entity is a limited Iiability company (LLC), the signatory is authorized signer as set fbrth in LLCs operating agreement.

IN WITNESS WHEREOF, the Parties hereto have caused their duly authorized representatives to execute this Agreement.

By:

Chuck ash ington
Chair of the Board of Supervi
SHI INTERNATIONAL CORP., New Jersey
corporation authorizcd to conduct business in the
State of California.
rs
N allte: nn
Title: sr. Manager - contracts
11u1"4. 7 /2/202aDated:

ATTEST:

Kimberly Rector
Clerk olthe Board
By'

APPROVED
Minh C. Tran
Ccr ounsel
'I RM
By
Patrla S cido
Deputy County Counsel
Dated: I ( r (zorq
Rc! rsron l{)6/2021
7 SEP 10 2s24 3 2e
COUNTY OF RIVERSIDE, a political
subdivision ofthe State of California
By: (ri"tl"- 1ta
q lfiilw
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Exhibit A
Scope and pricing
LSP's Scooc and rcsponsibilitics
The Licensed Support Provider (LSP) will resell all available Microsoft Licensed Support Provider (t-SP) tbr Microsoft Master Microsoft Enterprise Agreement No. 8084445; Software Licensing.

Softwarc Support. Cloud Services such as Azurc. lndustry Solutions Delivery (lSD) formerly Microsofi Consulting Services (MCS). Microsoft Unified Support and Microsoft incident response. Microsofl Select Plus Agreement No. 7756479.

The agreement with LSP as a LSP of the Microsofl Products and Services under Microsoft EA No. 8084445 is available for use by the County o1'Riverside and governmental agencies within the State of Calilornia. The LSP will serve as the liaison between the political entity for enrollments under the Microsotl EA.

The LSP agrees to extend the same pricing. terms. and conditions to every political entity. special district. in the State of Calilbrnia. It is understood that other entities shall make purchases in their own name. make direct payment. and be Iiable directly to the LSP oftheir choosing; and County shall in no way be responsible to any LSP for other entities' purchases.

The LSP rnay remain the LSP fbr the 'lhree 3-year duration of the Enrolled Afflliate's Enterprise Agreement Enrollment. All True-tJps during the 3-year enrollment (orders for new products, etc.) by Enrolled Afllliates are required to be submitted only through the Affiliate's selected LSP. Multiple LSP's cannot service a single Enterprise Agreement Enrollment. Enrolled Affiliate may at any time choose to transfer their current enrollment from one LSP to another LSP pursuant to the transfer terms set by Microsoft.

The Enrolled Affiliate shall work with the LSP to determine the annual payment. true-up commitment schedule defined in their enrollment.

The LSP will provide reports showing year to date annual spend according to Enrolled Affiliate's specifications. Frequency will be determined by each Enrolled Affiliate (ie: monthly. quarterly, etc.).

The LSP will provide reports of licenses purchased and added on to enrollment according to Enrolled Affiliate's specifications. (lntended for an enrollment that has licenses for multiple agencies within a governmental body - ie county. city. etc.) Frequency will be deterrnined by each Enrolled Affiliate (ie:
monthly. quarterly. etc. ).

The t-SP will provide. at the Enrolled Affiliate's request. a licensing portal that allows the tracking of licenses beyond the capabilities of the Microsoft VLSC. This portal will show, but not be limited to. all licenses on the current enrollment, quantities ofsaid licenses. track licenses at department/agency levels. transfer licenses to and from each department/agency. and have reporting functionalities. 2 J
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10. The LSP will provide training to the Enrolled Afllliate's Microsoft administrators on Microsoft portals such as the VLSC, Office 365, Azure. etc. within 30 days of receiving a purchase order for such products that introduce a new portal. LSP should outline what aspects of training they feel would be heneficial in their proposal.
ll. The I-SP will provide documentation to the Enrolled Af'filiate within 90 days of when Microsoft has made a change to a Iicense and advise of any grandfather or conversion rights within that same timeframc.

12. The l-SP will provide a short synopsis ofwhy an amendment is needed and the ramification ofeach amcndment to an enrollment at the time of such amendment. lJ. The LSP will provide an updated price list on an annual basis or when Microsoft changes price point. whichever is sooner. in an Excel spreadsheet to the Enrolled AfIliate. This price list must capture. at minimum. the tbllowing categories for each product: SKU. product description, MSRP. NET (t-evel D). LSP's uplitl and conlracted unit price.
14, The LSP shall provide a list of enrollments. The list of enrollments is due 30 days afier the contract signature and on January l5th ofeach calendar year during the agreement period. This list will include the agency name. contact person. email and phone number and annual spend. The intent of this is to track how many agencies within the State of Califomia piggyback off of the Master Agreement.

15. 'lhcLSPwill becharged I .00%o ofthe annual enrollment salesamountto leverage the Riverside County Master Microsofl Agreement No.8084445. and Select Plus Agreement No.7756479. which includes Soltware l-icensing. Software Support, Cloud Services such as Azure. lndustry Solutions Delivery (lSD). Microsoft Cionsulting Services (MCS). Microsoft Unified Support and Microsoft incident response. I'his administrative f'ee will be an annual fee. per enrollment inclusive of Affiliates Shadow Ilnrollments.

16. The Servicing LSP shall provide Microsoft Enterprise Support Services from Microsoft to assist customers leveraging this contract vehicle in operation ofthe technology acquired and assist Riverside Master Participants in maximizing the benefits of this investment.

I7. The Servicing LSP shall provide the ability to for the acquisition of Microsoft services as the demand fbr individual product services or capabilities expand. The servicing LSP shall provide seruices to include Microsofi Unitied. Industry Solutions Delivery (lSD). and Microsoft incident response. The Servicing LSP will have a valid Microsoft Master Services Agreement on file with Microsoft in order to resell Microsoft Unified Support. and lndustry Solutions Delivery (lSD). Additionally. the contractor shall provide Microsoft dedicated Technical Support representatives and subject matter experts provided via the Microsoft enterprise agreement to support and assist Riverside County master participants in analyzing. architecling. implernenting. managing. and operating solutions based on the Iicenses prev iously acqu ired or to be purchased in accordance with the terms ofthe M icrosoft enterprise licensing program.
9 Rcvrslor l/oavlol I
189
Docusign Envelope lD: D1C85720-gC7F-4A8E-8635-A681851FAA9E AGREEMENT # ITARC.OO929
18, LSP will be responsible fbr submitting a completed "Reporting of Active Enrollments'' by January I 5th of each year fbr the prior calendar year.

19. The County ol Riverside lnformation Technology (RCIT) will invoice the Awarded LSP annually based on the enrollmenls verified f'rom LSP Reporting of Active Enrollments.

20. Payment is due to Riverside County Information Technology thirty (30) days from invoice date.

21. 'lhe administrative lee shall not be included as an adjustment to LSP's Master Agreement pricing.

22. l'he administrative fee shall not be invoiced or charged to the Enrolled AtIliate. 23, Administrative fee checks shall be submitted to:

Riverside County Information Technology
Attn: Accounts Receivable
3450 l4th Street. 4th Floor
Riverside. CA 92501
Itc!rsron l/()6/:021
10 190
DocuSign Envelope lD D1CA572O-gC7F -4AAE-8635-4681851 FAAgE Pricins:
l. Microsoft Enterprise License Subscri ption and services

2. License Support Provider (LSP) Solution Area Specific Capability:

ACREEMENT # I1'ARC-00929
Item Description Price Level Markup o/"
Enterprise Online Services++ (including Full USLs. From SA USLs. Add-ons and Step Ups) M365 E3 and E5. Enterprise
Mobility + Security E3 and E5. Office 365 Enterprise El or E3. Windows l0 Enterprise E3 or 85.

Level D I l0
Enterprise Products (Olfice 365 Pro Plus. Windows l0
Enlerprise. Core CAL Suite. Enterprise CAL Suite). Level D I t0 Additional Products (M165 F l. M365 E5 Compliance. M365 E5 Security. Office 365 Enterprise F l. Project Online. Visio Online Plan I or Plan 2, Dynamics 365. Azure. SQL Server.

Windows Server. etc).

Level D I t0
Server and Tools Product (applies to Server and Cloud
Enrollnrents only) SharePoint Server. SQL Server. BizTalk Server. Visual Studio. Core Infrastructure Suites. etc.

Level D I l0
Af l products lbr Select Plus Agreement No.1756479. Lt0 Microsoft Unified Support Services 2.00
Microsoll Consulting Services 2.00
Microsoft Incident Response 2.00
Solution Area Specific Capability Number Customer Sizc Reference? Number of successful customer production
mail deployments/mi grations? 5.000 500- | 00.000 Yes. Upon Request Number of successful customer production
SharePoint deployments/m igrations? 5.000 500- I 00.000 Yes. [Jpon Requcst Number of successful customer production
Teams deployments/mi grations? 2.000 500- t 00.000 Yes. Upon Request Number of successful customer production
Teams Voice deployments/PBX migrations? r00 500- I 00-000 Yes" Upon Request Number of people with specialized expertise
on technologies listed above t00 N/A Yes. Upon Request
Re!rsron l06/2021
1t
191

3. License Support Provider (LSP) service rates:
]\GRI]EMENT /I ITAR('-O09]9
Data and Artificial lntelligent
Certified Competency
(Yes/No)
Hourly Rate (On
Premise)
Build lntelligent Apps $300.00
Build Intelligent Agents Yes $100.00
Machine [-earninc $300.00
lnternet ofThings Yes $300.00
Oloballv distributed data $_r00.00
OSS Databases Yes $_r00.00
Cloud Scale Analvtics Yes $_r00.00
Data Plalfbrm Modenrization to Azurc Yes $_r00.00
Windows Server on Azure $100.00
Security & Management $.r00.00
Datacenter Migration $100.00
Modern Business lnlelligence Yes $-r00.00
Copilot Yes $-100.00
Biz ADps
Yes $-r00.00
Field Service Yes $-100.00
Markeling Yes $.100.00
Talcnt Yes $-100.00
Finance and Operations Yes $-100.00
Business Central Yes $.]00.00
Power Apps Yes $100.00
Power Rl Yes $300.00
Apps and lnfrastructure
Azure Stack Yes $100.00
High Performance Compute Ycs $.'r00.00
Cloud Native Apps using Serverless Yes $100.00
Modernize Apps Yes $100.00
SAP on Azure Yes $.'r 00.00
l,inux on Azrrre Yes $100.00
Dev Ops Yes $100.00
Business Continuity & Disaster Recovery Yes $i00.00
Windows Server on Azure Yes $100.00
Security & Management Yes $-.i00.00
Datacenter Migration Yes $.r00.00
Modern Workplace
LJsor Adoption & Cl'range Manasenrcnt Yes $..100.00
Security Yes $-.i00.00
GDPR & Compliance Yes $300.00
'leanrwork Yes s300.00
Calling & Meetings Yes $100.00
Modern Desktop Yes $100.00
Office 365 Migration Assistance Ycs $300.00
\4 ail Yes $100.00
'feams Yes $100.00
SharePoint Yes $-.r 00.00
OrleDrive $100.00
Rcvrsron I/06/2021
t2
Docusign Envelope lD: D1C85720-SC7F-4A8E-8635-A681851 FAAgE Yes
Yes
Yes
Yes
Yes
Yes
Customer Service
Ycs
192
27118447
Budgetary
Feb-02-2026
Feb-28-2026
Phone: Phone:

Fax: Fax:

Email: Email:

All Prices are in US Dollar (USD) Years 1 located on sheet 2 Years 2-5 located on sheet 3
Additional Comments
951-461-6066 7326672779
[email protected] [email protected]
CA-City of Murrieta Inside Account Manager
John Borger Alex Chrysanthopoulos
1 Town Square
Murrieta, CA 92562
United States
SHI
290 Davidson Ave
Somerset, NJ 08873
Pricing Proposal
Quotation #:

Reference #:

Created On:

Valid Until:
193
Payment Schedule:
4/1/26-3/31/27 - $271,006.92
4/1/27-3/31/28 - $271,006.92
4/1/28-3/31/29 - $279,841.20
4/1/29-3/31/30 - $279,841.20
4/1/30-3/31/31 - $279,841.20
Total: $1,381,537.44
*Budgetary Pricing does not include CDT Fees*
*Disclaimer: The pricing provided in this quote is based on estimated statewide license volumes. CDT will confirm the final statewide pricing tier once all customer commitments have been received.

For M365 Copilot GCC Sub Add-on, there are two pricing tiers:

Tier 1 Pricing: Applies if the quantity of Copilot GCC Sub Add-on is less than 20% of your organization’s M365 G5 licenses on April 1, 2026.

Tier 2 Pricing (best): Requires a minimum Copilot GCC Sub Add-on enrollment of 20% of the organization's M365 G5 licenses be met on April 1, 2026, to qualify.

This quote has been marked as budgetary, as certain pricing may require approval from Microsoft. Please note, SHI is unable to process Purchase Orders against budgetary quotes. Kindly reach out to your SHI sales team for a Final Quote once you have determined your required counts and licenses.

Thank you for choosing SHI International Corp! The pricing offered on this quote proposal is valid through the expiration date listed above. To ensure the best level of service, please provide End User Name, Phone Number, Email Address and applicable Contract Number when submitting a Purchase Order. For any additional information including Hardware, Software and Services Contracts, please contact an SHI Inside Sales Representative at (888) 744-4084 SHI International Corp is 100% Minority Owned Woman Owned Business TAX ID# 22 -3009648; DUNS# 61-1429481; CCR# 61- The products offered under this proposal are resold in accordance with the terms and conditions of the Contract referenced under that applicable line item. 194
Item # Manufacturer Part # Product Contract Name Contract # Subcontract # Coverage Start Coverage End Quantity Your Price Total Note 1 Microsoft AAL-48033 M365 G5 FSA Renewal GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2026 Mar-31-2027 474 $497.88 $235,995.12 Year 1 of 5 2 Microsoft AAL-45735 M365 G5 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2026 Mar-31-2027 61 $548.64 $33,467.04 Year 1 of 5 3 Microsoft 7MS-00001 Planner & Project P3 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2026 Mar-31-2027 3 $272.28 $816.84 Year 1 of 5 4 Microsoft EP2-24658 M365 Copilot GCC Sub Add-on Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2026 Mar-31-2027 2 $363.96 $727.92 Year 1 of 5; Tier 1 Pricing Total $271,006.92
195
Manufacturer Part # Product Contract Name Contract # Subcontract # Coverage Start Coverage End Quantity Your Price Total Note Microsoft AAL-48033 M365 G5 FSA Renewal GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2027 Mar-31-2028 474 $497.88 $235,995.12 Year 2 of 5 Microsoft AAL-45735 M365 G5 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2027 Mar-31-2028 61 $548.64 $33,467.04 Year 2 of 5 Microsoft 7MS-00001 Planner & Project P3 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2027 Mar-31-2028 3 $272.28 $816.84 Year 2 of 5 Microsoft EP2-24658 M365 Copilot GCC Sub Add-on Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2027 Mar-31-2028 2 $363.96 $727.92 Year 2 of 5; Tier 1 Pricing Microsoft AAL-48033 M365 G5 FSA Renewal GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2028 Mar-31-2029 474 $514.68 $243,958.32 Year 3 of 5 Microsoft AAL-45735 M365 G5 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2028 Mar-31-2029 61 $562.92 $34,338.12 Year 3 of 5 Microsoft 7MS-00001 Planner & Project P3 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2028 Mar-31-2029 3 $272.28 $816.84 Year 3 of 5 Microsoft EP2-24658 M365 Copilot GCC Sub Add-on Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2028 Mar-31-2029 2 $363.96 $727.92 Year 3 of 5; Tier 1 Pricing Microsoft AAL-48033 M365 G5 FSA Renewal GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2029 Mar-31-2030 474 $514.68 $243,958.32 Year 4 of 5 Microsoft AAL-45735 M365 G5 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2029 Mar-31-2030 61 $562.92 $34,338.12 Year 4 of 5 Microsoft 7MS-00001 Planner & Project P3 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2029 Mar-31-2030 3 $272.28 $816.84 Year 4 of 5 Microsoft EP2-24658 M365 Copilot GCC Sub Add-on Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2029 Mar-31-2030 2 $363.96 $727.92 Year 4 of 5; Tier 1 Pricing Microsoft AAL-48033 M365 G5 FSA Renewal GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2030 Mar-31-2031 474 $514.68 $243,958.32 Year 5 of 5 Microsoft AAL-45735 M365 G5 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2030 Mar-31-2031 61 $562.92 $34,338.12 Year 5 of 5 Microsoft 7MS-00001 Planner & Project P3 GCC Sub Per User Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2030 Mar-31-2031 3 $272.28 $816.84 Year 5 of 5 Microsoft EP2-24658 M365 Copilot GCC Sub Add-on Microsoft Statewide Enterprise Licensing Agreement
SC 25-0198737 Local Government Apr-01-2030 Mar-31-2031 2 $363.96 $727.92 Year 5 of 5; Tier 1 Pricing 196
27161222
New Select Plus
Feb-11-2026
Mar-31-2026
Phone: Phone:

Fax: Fax:

Email: Email:

Pricing Proposal
Quotation #:

Reference #:

Created On:

Valid Until:

[email protected]
CA-City of Murrieta Microsoft Inside Account Manager
John Borger Michael Lipere
1 Town Square
Murrieta, CA 92562
United States
SHI International Corp
290 Davidson Ave
Somerset, NJ 08873
All Prices are in US Dollar (USD) Quoted Items located on Sheet2 Additional Comments
951-461-6066 800-527-6389 ext. 5071509
512-732-0232
[email protected]
197
<b>Pricing is subject to change based on OEM and Distribution pricing changes </b><br><br> This quote has been marked as budgetary, as certain pricing may require approval from Microsoft. Please note, SHI is unable to process Purchase Orders against budgetary quotes. Kindly reach out to your SHI sales team for a Final Quote once you have determined your required counts and licenses.

Thank you for choosing SHI International Corp! The pricing offered on this quote proposal is valid through the expiration date listed above. To ensure the best level of service, please provide End User Name, Phone Number, Email Address and applicable Contract Number when submitting a Purchase Order. For any additional information including Hardware, Software and Services Contracts, please contact an SHI Inside Sales Representative at (888) 744-4084. SHI International Corp. is 100% Minority Owned, Woman Owned Business. TAX ID# 22-3009648; DUNS# 61- 1429481; CCR# 61-243957G; CAGE 1HTF0
WSCA Contract for California: ADSPO11-00000358-3 PA 70-12-70-19 Trend Micro Contract for California: SLP-12-70-0003V
Attachmate Contract for California: SLP-13-70-0003W
First time user for SHI Direct website? Please use the following information when registering.

California Gov't:
http://www.publicsector.shidirect.com/slg/ca
Token: 30343
Access Key: HBB59KL3PK
The products offered under this proposal are resold in accordance with the terms and conditions of the Contract referenced under that applicable line item. 198
Item # Manufacturer Part # Product Contract Name Contract # Coverage StartCoverage End Quantity Your Price TotalNote 1 Microsoft 9GA-00306 CIS Suite Standard Core SLng SA 2L County of Riverside - Microsoft ITARC-00929 May-01-2026 Apr-30-2029 16 $125.57 $2,009.12Select Plus, 36 Months 2 Microsoft 076-01920 Project Standard SLng SA County of Riverside - Microsoft ITARC-00929 May-01-2026 Apr-30-2029 7 $386.53 $2,705.71Select Plus, 36 Months 3 Microsoft D87-01158 Visio Professional SLng SA County of Riverside - Microsoft ITARC-00929 May-01-2026 Apr-30-2029 8 $329.38 $2,635.04Select Plus, 36 Months 4 Microsoft D86-01252 Visio Standard SLng SA County of Riverside - Microsoft ITARC-00929 May-01-2026 Apr-30-2029 8 $176.16 $1,409.28Select Plus, 36 Months 5 Microsoft 9EM-00263 Win Server Standard Core SLng SA 2L County of Riverside - Microsoft ITARC-00929 May-01-2026 Apr-30-2029 312 $72.79 $22,710.48Select Plus, 36 Months Total $31,469.63
199

CITY OF MURRIETA
City Council Meeting Agenda
Report
3/17/2026
Agenda Item No. 7.

TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Justin Clifton, City Manager
PREPARED BY: Isaac Bravo, Management Analyst
SUBJECT:

Second Reading of Ordinance No. 629-26 Prohibiting the Sale and Distribution of Kratom

ABSTRACT
Council Member DeForest received consensus from City Council to direct staff to present an ordinance banning the sale and distribution of synthetic Kratom and banning the sale and distribution of natural Kratom for anyone under 21 years of age. The City Council considered this on March 3, 2026, and approved the first reading of Ordinance 629-26.

RECOMMENDATION
Conduct the second reading and adopt Ordinance No. 629-26 entitled: An Ordinance of the City Council of the City of Murrieta, California, Amending the Murrieta Municipal Code by Adding New Chapter 9.40, Regulating the Sale and Distribution of Kratom.

PRIOR ACTION/VOTE
On December 16, 2025, the Council Member DeForest received consensus from the City Council to direct staff to present an ordinance banning the sale and distribution of Kratom within the City limits.

On January 20, 2026, staff presented the City Council with a proposed ordinance to ban the sale and distribution of Kratom. During that meeting, Mayor Levell introduced a letter from the California Department of Public Health (CDPH) addressing Kratom. It was not initially clear what implications the letter from CDPH had on the legality of the sale of Kratom and the proposed ordinance banning Kratom.

On February 3, 2026, staff presented additional information, making clear that the letter from CDPH concluded that Kratom was not approved as a food additive or supplement. Based on this clarification, staff withdrew its recommendation to refrain from adopting an ordinance banning Kratom as such a ban would be substantially different from the ban of its use as a food additive or supplement. After discussion, the City Council directed staff to continue researching the issue and return at a future date with further analysis and policy options.

On February 17, 2026, Council Members DeForest and Stone proposed a future agenda item including an ordinance for consideration that would prohibit the sale of Kratom to individuals under the age of 21 and prohibiting the sale of any product with synthetic 7-hydroxymitragynine (that generally corresponds to Kratom CITY OF MURRIETA Printed on 3/12/2026Page 1 of 2
powered by Legistar™
200
3/17/2026
Agenda Item No. 7.
prohibiting the sale of any product with synthetic 7-hydroxymitragynine (that generally corresponds to Kratom with greater than 2% of the total alkaloids in the product). The City Council requested that the proposed ordinance be brought forward for formal consideration at its next regular meeting scheduled for March 3, 2026.

On March 3, 2026, the City Council conducted and approved the first reading of Ordinance No. 629-26 with the direction to remove references to possession (Vote: 5-0).

STRATEGIC ALIGNMENT
Provide a high level of innovative public safety.

DISCUSSION
Kratom contains natural chemicals called alkaloids, mainly mitragynine and 7-hydroxymitragynine (7-OH). The concentration of 7-OH in natural Kratom is less than 2%. Kratom products with greater than 2% concentration of 7-OH are enhanced with synthetic 7-OH.

The proposed ordinance is consistent with the consensus that the City Council provided to staff, and also mirrors ordinances passed by the cities of Newport Beach, Huntington Beach, Temecula, and Riverside County. These jurisdictions have adopted similar restrictions, which prohibit the sale of synthetic or enhanced Kratom products to anyone; and restrict natural Kratom to those who are 21 years and older.

PUBLIC NOTICING
The agenda for this meeting was posted at least 72 hours in advance in accordance with the Brown Act. No additional public noticing is required for this item.

CEQA AND REGULATORY OVERVIEW
This item is not a project as defined under Public Resource Code § 21065 and is exempt from CEQA and NEPA.

FISCAL IMPACT
There is no fiscal impact associated with this report.

ATTACHMENTS
ATT 1 - Ordinance No. 629-26
CITY OF MURRIETA Printed on 3/12/2026Page 2 of 2
powered by Legistar™
201
1 ORDINANCE NO. 629-26

AN ORDINANCE OF THE CITY COUNCI L OF THE CITY OF MURRIETA,

CALIFORNIA, AMENDING THE MURRIETA MUNICIPAL CODE BY
ADDING NEW CHAPTER 9.40 THEREOF REGULATING THE SALE
AND DISTRIBUTION OF KRATOM AND SYNTHETIC 7-OH
Summary: This ordinance amends portions of Title 9 of the City of Murrieta Municipal Code, by adding a new chapter, Chapter 9.40 “Regulating the Sale and Distribution of Kratom and Synthetic 7-OH”.

WHEREAS, kratom (mitragyna speciosa) is a tropical tree native to Southeast Asia, and its leaves are often consumed in powdered or extract form for their stimulant and sedative effects; and
WHEREAS, the naturally occurring active compounds in kratom include mitragynine and 7-hydroxymitragynine. W hile mitragynine is present in higher concentrations, 7- hydroxymitragynine is more potent and is largely responsible for the stronger pain-relieving, sedative, and euphoric effects; and
WHEREAS, 7-hydroxymitragynine binds to opioid receptors in the brain and has been shown to have euphoric and mood-enhancing effects, particularly at higher doses, which can increase its appeal for recreational use; and
WHEREAS, 7-hydroxymitragynine is believed to be more potent than morphine, and this greater potency raises significant concerns about its safety profile, especially regarding the potential for addiction, overdose, and adverse physical and psychological effects, including nausea, vomiting, and potential psychosis, and these risks are compounded when products contain higher concentrations of 7-hydroxymitragynine; and WHEREAS, Scientific research and health advisories have raised concerns over the safety of kratom products, particularly those with higher concentrations of 7- hydroxymitragynine, which may increase the potential for abuse and harm to public health; and WHEREAS, Several cities in California have outright banned all kratom products in an effort to protect public safety, especially among the vulnerable population; and WHEREAS, The City Council is committed to safeguarding the health and well-being of its residents by ensuring that products available for sale do not pose undue health risks; and WHEREAS, it is the intent of the City Council to regulate the sale and distribution of kratom and other products within the City of Murrieta that contain more than a 2% concentration of 7-hydroxymitragynine in the alkaloid fraction by anyone less than twenty-one (21) years of age, recognizing the significant health risks associated with elevated concentrations of this alkaloid.
202
2 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MURRIETA, CALIFORNIA DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. New Chapter 9.40 is added to the Murrieta Municipal to read as follows:
“Chapter 9.40 REGULATION OF THE SALE AND DISTRIBUTION OF KRATOM §9.40.010 Title
§9.40.020 Purpose and Intent
§9.40.030 Definitions
§9.40.040 Regulation of the Sale and Distribution of Kratom §9.40.050 Violations and Penalties
§9.40.060 Severability
§9.40.010 Title
This chapter shall be known as the “Kratom Regulation Ordinance” and may be so cited. §9.40.020 Purpose and Intent
It is the purpose of these regulations to aid in the reduction of the consumption of kratom, as the purported effects include addiction, psychosis, and other physical ailments, and recent studies have found an increase in use by those under the age of 18. The city desires to restrict the consumption of (a) kratom by people under the age of twenty-one (21) years of age and (b) 7- hydroxymitragynine, where state law and current city regulations are silent, in furtherance of creating a safer community.
§9.40.030 Definitions
For purposes of this chapter, the following definitions apply. (a) “Attractive to children” means any of the following:
(1) Use of images that are attractive to children, including, but not limited to, images of any of the following, except as part of required health warnings:
(A) Cartoons, toys, or robots
(B) Any real or fictitious humans.
(C) Fictional or real animals or creatures.
(D) Fruits or vegetables, except when used to accurately describe ingredients or flavors contained in a product.
(2) Likeness to images, characters, or phrases that are popularly used to advertise to children.
203
3 (3) Imitation of candy packaging or labeling, or other packaging and labeling of cereals, sweets, chips, or other food products typically marketed to children.
(4) The terms, “candy” or “candies” or variants of the spelling, such as “kandy” or “kandee”.
(5) Brand names or close imitations of brand names of candies, cereals, sweets, chips, or other food products typically marketed to children. (6) Any other image or packaging that is easily confused with commercially available foods that do not contain kratom and are typically marketed to children.
(7) Any other packaging used that is attractive to children considering all relevant facts and circumstances.
(b) “Kratom leaf” means the leaf of the kratom plant, also known as mitragyna speciosa, any form
(c) “Kratom leaf extract” means the material obtained by extraction of kratom leaves by any means.
(d) “Kratom product” means a product consisting of any part of a leaf of the plant Mitragyna speciosa in fresh, dehydrated, or dried form; or a kratom extract, or any product that contains any kratom alkaloid or metabolite. (e) “Total kratom alkaloids” means the sum of mitragynine, speciociliatine, speciogynine, paynantheine, and 7-hydroxymitragynine in a kratom product. (f) “Synthesized” means an alkaloid derivative that has been created by chemical synthesis or biosynthetic means (including but not limited to; fermentation, recombinant techniques, yeast-derived, enzymatic techniques), rather than traditional food preparation techniques such as heating or extracting. It also includes alkaloids that have been further exposed to chemicals or processes that would confer a structural change in the alkaloids contained within the extract.
§9.40.040 Regulation of the Sale and Distribution of Kratom A. It is unlawful to sell, attempt to sell, or offer, provide, or distribute, directly or indirectly, any kratom product to a
person under 21 years of age.

B. It is unlawful to sell, attempt to sell, offer, provide, or distribute any product with a level 7-hydroxymitragynine that is greater than 2 percent of the total alkaloids in the product. 204
4 C. It is unlawful to sell, attempt to sell, offer, provide, or distribute a kratom product or a product containing 7-hydroxymitragynine that is attractive to children.

D. Any individual, business, or other entity that sells, attempts to sell, offers, provides, or distributes a kratom product shall conduct age verification to ensure compliance with subdivision (A).

E. It is unlawful to offer for sale any kratom product that contains or is adulterated with synthesized or semi-synthesized kratom alkaloids or kratom constituents. §9.40.050 Violations and Penalties
Each violation of section 9.40.040 shall constitute a separate offense and shall be treated as an infraction or a misdemeanor, at the discretion of the City Attorney, pursuant to the provisions of Murrieta Municipal Code Section 1.32.010 except as provided by state law. §9.40.060 Severability
If any section, paragraph, sentence, clause, phrase, or portion of this chapter is held invalid or unconstitutionally by any court of competent jurisdiction, such portion shall be deemed severable and such holding shall not affect the validity of the remaining portions thereof. The City Council hereby declares that it would have adopted this chapter irrespective of an invalidity of any particular portion thereof and intends that the invalid portions should be severed, and the remaining chapter be enforced.”
SECTION 2. This Ordinance is categorically exempt from environmental review, per the provisions of the California Environmental Qua lity Act (CEQA) of 1970, as amended, 14 California Code of Regulations Section 15061(b)(3) as it can be seen with certainty that the adoption of this ordinance has no possibility to significantly impact the environment.

SECTION 3. This ordinance shall take effect thirty (30) days after its adoption.

SECTION 4. If any provision of this ordinance or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications, and to this end the provisions of this ordinance are declared to be severable.

SECTION 5. The City Clerk shall certify to the adoption of this ordinance and shall publish a summary of this Ordinance and post a certified copy of the full ordinance in the office of the City Clerk at least five (5) days prior to the adoption of the proposed ordinance; and within fifteen (15) days after adoption of the ordinance, the City Clerk shall publish a summary of the ordinance with the names of the council members voting for and against the ordinance. 205
5 PASSED AND ADOPTED this __th day of _______, 2026.

Jon Levell, Mayor

ATTEST:

Cristal McDonald, City Clerk

APPROVED AS TO FORM:

Tiffany J. Israel, City Attorney

STATE OF CALIFORNIA)
COUNTY OF RIVERSIDE) §

CITY OF MURRIETA)

I, Cristal McDonald, City Clerk of the City of Murrieta, California, do hereby certify that the foregoing Ordinance No. 629-26 was duly introduced on the 3rd day of March, 2026, passed and adopted by the City Council of the City of Murrieta at the regular meeting thereof, held on the ___th day of ________, 2026, and was signed by the Mayor of the said City, and that the same was passed and adopted by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

Cristal McDonald, City Clerk

I, Cristal McDonald, City Clerk of the City of Murrieta, California further certify that Ordinance No. 629-26 was duly published according to law and the order of the City Council of said City and the same was so published in Press Enterprise, a newspaper of general circulation on the following date(s):

206
6 Introduced Ordinance: March 9, 2026
Adopted Ordinance: , 2026.

In witness whereof, I have hereunto subscribed to my name this __ day of ______________, 2026.

Cristal McDonald, City Clerk
207

CITY OF MURRIETA
City Council Meeting Agenda
Report
3/17/2026
Agenda Item No. 8.

TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Brian Ambrose, Community Services Director
PREPARED BY: Gretchen Sedlacek, Assistant Management Analyst SUBJECT:

Donation Acceptance for Murrieta Children’s Library Expansion Project

ABSTRACT
The Murrieta Public Library received a donation of $500 from the Temecula Valley Woman’sClub, to be used towards the Children’sLibrary Expansion project. Staff asks that the City Council accept the donation and authorize an amendment to the Fiscal Year 2025/26 Operating Budget.

RECOMMENDATION
Approve acceptance of a donation from the Temecula Valley Woman’s Club in the amount of $500, for the Murrieta Children’s Library Expansion Project; and
Authorize amendment of the Fiscal Year 2025/26 Operating Budget as referenced in the Fiscal Impact statement.

PRIOR ACTION/VOTE
None.

STRATEGIC ALIGNMENT
The City Council’sgoal of coordinating and delivering responsive, effective community services is associated with this administrative priority.

DISCUSSION
California Government Code Section 37354 authorizes the City Council to accept gifts made to the City of Murrieta. The Murrieta Public Library receives various donations throughout the year to support special events, programming, and capital improvement projects. There is one current donation to be accepted for the Library Expansion Project:

Donor Description Total Donation
Temecula Valley Woman’s Club Children’s Library Expansion $500 CITY OF MURRIETA Printed on 3/12/2026Page 1 of 2
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Agenda Item No. 8.

Donor Description Total Donation
Temecula Valley Woman’s Club Children’s Library Expansion $500

PUBLIC NOTICING
The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item).

CEQA AND REGULATORY OVERVIEW
This action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly.

FISCAL IMPACT
To account for the donation and its planned use, staff recommends an amendment to the Fiscal Year 2025/26 Operating Budget to increase revenue in account 3110050-47702 and to increase expenditure account 3110050-70000 JL 21027311-500.

ATTACHMENTS
None.

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CITY OF MURRIETA
City Council Meeting Agenda
Report
3/17/2026
Agenda Item No. 9.

TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Brian Ambrose, Community Services Director
PREPARED BY: Gretchen Sedlacek, Assistant Management Analyst SUBJECT:

Lunch at the Library Summer 2026 Grant

ABSTRACT
For the past two (2) years, Lunch at the Library has been a grant funded program with a partnership between the Murrieta Public Library and the Murrieta Valley Unified School District’ssummer meal program that is held at Murrieta Elementary School. The program provides free healthy lunches and activities for children under 18 during summer break. Staff asks that the City Council approve acceptance of a grant from the California State Library to provide pop-up library services at the school and authorize an amendment to the Fiscal Year 2026/27 Operating Budget.

RECOMMENDATION
Approve acceptance of the California State Library’s Lunch at the Library Summer 2026 grant, in the amount of $12,362, for the Murrieta Public Library;
Ratify the signed Certification of Compliance form and the Financial Claim form; Authorize the City Manager to execute all necessary documents to accept the grant funds; and Amend the Fiscal Year 2026/27 Operating Budget as described in the fiscal impact statement.

PRIOR ACTION/VOTE
On November 21, 2023, the City Council approved the application for the Lunch at the Library Summer 2024 grant (Vote: 5-0).

On February 20, 2024, the City Council authorized the City Manager to accept grant funds from the California State Library for the Lunch at the Library 2024 Summer program (Vote: 5-0).

On March 4, 2025, the City Council authorized the City Manager to accept grant funds from the California State Library for the Lunch at the Library 2025 Summer program (Vote: 5-0).

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Agenda Item No. 9.

STRATEGIC ALIGNMENT
The City Council’sgoal of coordinating and delivering responsive, effective community services is associated with this administrative priority.

DISCUSSION
The Murrieta Valley Unified School District (MVUSD) offers a summer meal program that provides free healthy lunches and activities for children under 18 during summer break, ensuring continued access to nutritious food and learning opportunities. For the past two (2) years, the Murrieta Public Library (Library) has applied for and received grant funding through the California State Library (CSL) Lunch at the Library program. This created a strong collaboration where the Library provided pop-up library services at the MVUSD summer meal site at Murrieta Elementary School. Services included enrichment activities, book giveaways to support home libraries, and connections to library resources. In total, hundreds of students receive services during this program.

To build on this success, Library staff applied for the 2026 Lunch at the Library grant to continue pop-up services at the summer meal site. The grant funds will be used to purchase books and programming supplies, as well as to pay for presenters to enhance the program. Recently, the City was notified that grant funding totaling $12,362 will be provided.

PUBLIC NOTICING
The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item).

CEQA AND REGULATORY OVERVIEW
This action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly.

FISCAL IMPACT
Staff recommends that the City Council authorize an amendment to the Fiscal Year 2026/27 Operating Budget to establish a revenue appropriation in Library Grant Fund Account 3570050-42221 and an expenditure appropriation in Account 3570050-64000 and a corresponding job ledger code for tracking purposes.

ATTACHMENTS
ATT 1 - Grant Award Packet - Summer 2026
ATT 2 - Grant Award Budget Form - Summer 2026
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California State Library
Library Development Services
Grant Award Budget Form
Grant Opportunity Name:

Applicant Organization Name:

Project Title:

IMPORTANT: Each budget category on this form includes help text which highlights selected important guidance relating to each category. The help text does not include all budget instructions. For complete budget guidelines and information, please refer to the Application Instructions.

A) SALARIES, WAGES, AND BENEFITS
Include FTEs for every position included in this budget category .

For more information on FTEs, including how to calculate, see https://www.library.ca.gov/grants/lsta-handbook/fte/ Expense FTE Grant Funds Requested2 Cash Match & In-Kind Total Description Details Project Supervisor- Library Services Supervisor 0.06 $6,172 $6,172 120 hours for the Supervising Librarian responsible for creating reports.

Manages grant budget. Implement and facilitate pop-up library programs. Research and create pop-up programs. Facilitates and schedules vendors. Helps with set-up/cleanup and activities for pop-ups.

Library Specialist 0.02 $923 $923
40 hours for the Library Specialist to create schedules and monitor staff rotation for pop-up library programs. Assists with program planning and development. Helps with set-up/cleanup and activities for pop-ups.

Library Assistant I/II 0.01 $720 $720
30 hours for library assistant to help with program planning and development. Helps with set-up/cleanup and activities for pop-ups.

Oversees Volunteers.

Assistant Management Analyst 0.01 $719 $719
15 hours for Asst. Management Analyst to track POs, invoices, and grant spending. Manages service agreements, contracts, insurance etc. for vendors providing enrichment presentation services.
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Salaries, Wages, and Benefits Subtotal: $0 $8,534 $8,534

B) CONSULTANT FEES
Contracted service providers who will provide consulting services for the project must be listed in this category. Include name of each consultant or name of each consultant's firm. If an individual will be providing consulting services AND other services, that individual shall be listed in both the Consultant Fees category and the Services category. Only budget category-specific expenses shall be listed in each budget category (e.g. if a project plans to contract with one individual to provide consulting services in addition to project management services, an individual's consulting time cost estimate shall be listed in the Consultant Fees category and that same individual's Project Manager cost estimate shall be listed in the Services category).

Expense Column1 Grant Funds Requested Cash Match & In-Kind Total Description Details $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Consultant Fees Subtotal: $0 $0 $0 $0

C) TRAVEL
Please see application instructions for budget guidance and information pertaining to the Travel budget category.

Expense Column1 Grant Funds Requested2 Cash Match & In-Kind Total Description Details $0
$0
$0
$0
$0
$0
$0
$0
Travel Subtotal: $0 $0 $0 $0

D) SUPPLIES AND MATERIALS
Gifts/prizes/incentives/giveaways; including cash prizes or gift certificates with monetary value are unallowable.

Bookmarks and summer reading logs are unallowable unless they include information about meal service times/locations and/or the LATL logo Books to build home libraries are allowable (See Description Details below for requirements) Food is unallowable unless it is being used in an enrichment program (i.e. a cooking demonstration, etc.) Take and make kits are allowable only at non-congregate (grab and go) locations. Check with the LATL team to confirm if your library is eligible.

Expense Column1 Grant Funds Requested Cash Match & In-Kind Total Description Details Books to build home libraries $6,000 $1,000 $7,000
1,000 books to build home libraries will be purchased. Books distribution will include literature connecting families to summer reading and the California State Library Acknowledgement.

Craft Supplies $800 $800
Used for the purchase of craft supplies for activities. Paint brushes, popsicle sticks, brown paper bags, lollipop sticks, envelopes, glue, tape, string, paint canvases, paint, sticker packs, paper plates, cotton balls, pipe cleaners, googly eyes, coffee filters, felt, clothes pins, string/ribbon etc.

Locally Sourced food and seeds $735 $735
Purchase of locally grown food to be used for food cutting and cooking demonstrations. Seeds to be purchased for programs teaching planting and home gardening.

Portable shelves and table for outreach booth $1,355 $1,355 Folding shelves and tables for pop-up center to be used for pop-up play stations and book displays.

Interactive play and learn items $436 $436
Items for nutrition learning center to be used during meal time at the community meal site, interactive activities for play and learn. Food and nutrition theme box with games and props to be used immediately before or after meal service at the library and set up during mealtimes at the meal site on pop-up days.

Summer 2026 Lunch at the Library
Murrieta Public Library
Lunch at the Library
212
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Supplies & Materials Subtotal: $0 $9,326 $1,000 $10,326

E) EQUIPMENT
Include in this category any single item valued at $5,000 or more per unit.

Note: Federal grants require equipment approval by the Institute of Museum and Library Services (IMLS).

Expense Column1 Grant Funds Requested Cash Match & In-Kind Total Description Details $0
$0
$0
$0
$0
$0
$0
$0
Equipment Subtotal: $0 $0 $0 $0

F) SERVICES
Include all costs for individuals contracted to manage and/or implement project activities. If the proposed project includes subscription or license costs, these must be included in this category.

Note: Federal award funds cannot be used to fund portions of contracts that fall outside of and/or extend beyond the project period.

Expense Column1 Grant Funds Requested Cash Match & In-Kind Total Description Details Enrichment Presentations $1,800 $1,800
Three enrichment presentations to be held during and after meal service.

Presentations will include an Introduction to farm animals w/petting zoo.

Science themed presentation with STEM activity. Annie Bannannie ballon twisting demonstration with hands on tutorials for participants building, fine motor, problem solving and listening skills.
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Services Subtotal: $0 $1,800 $0 $1,800

PROJECT SUBTOTAL
Grant Funds Requested Cash Match & In-Kind Total
Project Subtotal: $11,126 $9,534 $20,660

G) INDIRECT COSTS
An indirect cost is the applicant’s incurred cost that cannot be readily isolated or identified with just one project or activity. These types of costs are often referred to as “overhead costs.” Typical examples of indirect costs are general telephone service, postage, office supplies, office space expenses, and administrative or financial operations for Applicants may choose to:
• Not request any indirect costs;
• Use a current approved indirect cost rate with a federal agency or one pending review to be approved by the project start date (applicants choosing this option must attach supporting documentation to application); or • Use an indirect cost rate not to exceed 10% of modified total direct costs (MDTC). MTDC means all direct salaries and wages, applicable fringe benefits, materials and supplies, services, travel, and subcontracts up to the first $25,000 of each subcontract.

Indirect cost rate applied (%): 10%
Grant Funds Requested Cash Match & In-Kind Total Description Details Indirect Costs Total: $1,236 $1,236
Organizational expenses for general operations including facilities, office supplies, telephone services, accounting and administrative costs, etc.

Indirect Costs Description (please include a detailed breakdown of your indirect cost calculation) :

GRAND TOTAL
Grant Funds Requested Cash Match & In-Kind Total
Grand Total: $12,362 $9,534 $21,896
213
California State Library
Library Development Services
Grant Award Budget Form
Grant Opportunity Name:

Applicant Organization Name:

Project Title:

IMPORTANT: Each budget category on this form includes help text which highlights selected important guidance relating to each category. The help text does not include all budget instructions. For complete budget guidelines and information, please refer to the Application Instructions.

A) SALARIES, WAGES, AND BENEFITS
Include FTEs for every position included in this budget category .

For more information on FTEs, including how to calculate, see https://www.library.ca.gov/grants/lsta-handbook/fte/ Expense FTE Grant Funds Requested2 Cash Match & In-Kind Total Description Details Position Title (ex: Librarian I, Library assistant, etc.) $0 Include estimated number of hours to be worked and FTE. Explain what activities they will do to support the grant.

Teen Interns $0
Interns should be included in salaries if they are receiving hourly wages.

Include estimated number of hours to be worked and FTE. Explain what activities they will do to support the grant and what activities or trainings will they participate in for educational and workforce development. (Note: If interns are receiving a scholarship or payment for work under contract, this should be included in services instead of salaries) $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Salaries, Wages, and Benefits Subtotal: $0 $0 $0

B) CONSULTANT FEES
Contracted service providers who will provide consulting services for the project must be listed in this category. Include name of each consultant or name of each consultant's firm. If an individual will be providing consulting services AND other services, that individual shall be listed in both the Consultant Fees category and the Services category. Only budget category-specific expenses shall be listed in each budget category (e.g. if a project plans to contract with one individual to provide consulting services in addition to project management services, an individual's consulting time cost estimate shall be listed in the Consultant Fees category and that same individual's Project Manager cost estimate shall be listed in the Services category).

Expense Column1 Grant Funds Requested Cash Match & In-Kind Total Description Details Consultant Name OR Name of Consultant's Firm $0
Include details about what consultant services are being provided and how this will support grant activities and/or the goals of the project.

Include the number of hours the consultant is being contracted for. $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Consultant Fees Subtotal: $0 $0 $0 $0

C) TRAVEL
For more information pertaining to the State Travel rate, see https://www.calhr.ca.gov/about-calhr/divisions-programs/benefits/travel-reimbursements/.

Expense Column1 Grant Funds Requested2 Cash Match & In-Kind Total Description Details Travel to and from community meal sites $0
Include the name of the locations you will travel to and the mode of transportation. Include the number of miles being traveled and the rate being used to calculate total. The rate should be the State Rate of 70 cents/mile. Include details about what activities will be provided (i.e. enrichment programs, providing books for home libraries etc.) Travel to and from meal partner site for food pickup $0 Include the name of the locations you will travel to and the mode of transportation. Include the number of miles being traveled and the rate being used to calculate total. The rate should be the State Rate of 70 cents/mile. Specify that travel is to pick up food from the meal partner to serve at library meal sites.
$0
$0
$0
$0
$0
$0
Travel Subtotal: $0 $0 $0 $0

D) SUPPLIES AND MATERIALS
Gifts/prizes/incentives/giveaways; including cash prizes or gift certificates with monetary value are unallowable.

Bookmarks and summer reading logs are unallowable unless they include information about meal service times/locations and/or the LATL logo Books to build home libraries are allowable (See Description Details below for requirements) Food is unallowable unless it is being used in an enrichment program (i.e. a cooking demonstration, etc.) Take and make kits are allowable only at non-congregate (grab and go) locations. Check with the LATL team to confirm if your library is eligible.

Expense Column1 Grant Funds Requested Cash Match & In-Kind Total Description Details Books to build home libraries $0
Include the number of books you anticipate purchasing and confirm the following information: "## of books to build home libraries. Books will include literature connecting families to summer reading and will include the California State Library acknowledgement."
Supplies for enrichment programming $0
Include examples of the types of supplies being purchased and the anticipated number of programs to be provided using these supplies.

Confirm that enrichment programs will be held before, during, or after meal service at a library or community meal site. (Examples include pompoms, glue sticks, popsicle sticks for craft programs or a small bag of produce for cooking demonstrations)
214
Supplies for meal service $0
Include examples of the types of supplies being purchased how they will be used to support meal service. (i.e. tablecloths, garbage cans, and rugs to keep the meal service area clean. Gloves, aprons, and thermometers to ensure safe food handling during meal service, etc.) Supplies for teen interns $0
Include examples of the types of supplies being purchased how they will be used by teen interns to support the grant and/or to support the educational and workforce development for the interns (i.e. Binders and notebooks for teens to use during trainings, LATL branded aprons or lanyards to let families know teens are assisting with LATL) iRead or CSLP Summer Reading Resources $0
Name the type of items that were purchased and how they will be used to support LATL. Examples include the resource guide, which includes marketing materials for summer programs. (Incentives and giveaways are not allowable with grant funds).

Stickers or stamps with the required California State
Library acknowledgement $0
Books purchased to help build home libraries are required to have the California State Library acknowledgement.

Refrigerator for meal service $0
Larger items such as refrigerators, tables, chairs, etc.. Should be listed as separate line items. Include details about how these items are being used to support the grant (I.e. A refrigerator for Library Name to keep food cold for meal service. Tables and chairs to be used during meal service at Library Name, etc.)
Tables and chairs for meal service $0
Wagons for transporting supplies $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Supplies & Materials Subtotal: $0 $0 $0 $0

E) EQUIPMENT
Include in this category any single item valued at $10,000 or more per unit.

Expense Column1 Grant Funds Requested Cash Match & In-Kind Total Description Details Name of item that costs $10,000 or more (for example a
charlie cart) $0
Items should only be listed in equipment if they cost $10,000 or more per item. Include details about how the item will be used to support the grant.
$0
$0
$0
$0
$0
$0
$0
Equipment Subtotal: $0 $0 $0 $0

F) SERVICES
Include all costs for individuals contracted to manage and/or implement project activities. If the proposed project includes subscription or license costs, these must be included in this category.

Note: Grant funds cannot be used to fund portions of contracts that fall outside of and/or extend beyond the project period.

Expense Column1 Grant Funds Requested Cash Match & In-Kind Total Description Details Enrichment presentations $0
Include the number of anticipated enrichment presentations and confirm that they will be held before, during, or after meal service.

Provide the names of the presenters and/or the types of presentations that will be held (i.e. Cooking demonstrations, music activities, STEM activity, etc.)
Food Handlers Permits, CPR Training, etc. $0
Include the number of staff and/or interns you anticipate will take the training and details about how this supports the grant. (I.e. Food handlers permits to ensure staff are trained on safe food handling practice. CPR Training to ensure staff are prepared in case of an emergency at a meal site, etc.)
Social Media ads $0
Include what service is being paid for (i.e. Targeted Facebook ads, commercials on iHeart radio, etc.). Include the anticipated number of ads to be purchased and how this supports the grants (I.e. to raise awareness of meal site locations and/or times).

Postcard campaign, billboard ads, etc. $0
Include what service is being paid for (i.e. Targeted postcard printing and delivery, billboard ad, etc.) Include the anticipated number of ads to be purchased and how this supports the grants (I.e. to raise awareness of meal site locations and/or times).

Printing Services $0
If printing is not being done in house, include the anticipated number of items to be printed and how this supports the grant (I.e. 200 printed flyers to provide information about meal site locations and/or times).

Scholarships for teen interns or teen interns receiving payment under a contract $0
If interns are receiving a scholarship: List the amount being provided per scholarship and the anticipated number of scholarships to be given. If interns are receiving payment for work under contract, list the amount being provided per contract and the anticipated number of interns to be hired. Include estimated number of hours to be worked and FTE.

Explain what activities they will do to support the grant and what activities or trainings will they participate in for educational and workforce development. (Note: If interns are being paid an hourly wage, they should be included in salaries, wages, and benefits instead of services).

Branded banners, flags, tablecloths, etc. $0
If paying for a service to create branded items, these should be in services instead of supplies. Specify how they are being used for LATL (i.e. to help families locate the meal site, to help promote meal service, etc.) and confirm that branding includes LATL and the California State Library logo
Carpet cleaning at the end of summer $0
Specify how many library meal sites you are planning to have cleaned and explain how this helps support LATL (i.e. To keep the meal site clean and welcoming for families)
$0
$0
$0
$0
$0
Services Subtotal: $0 $0 $0 $0
215

PROJECT SUBTOTAL
Grant Funds Requested Cash Match & In-Kind Total
Project Subtotal: $0 $0 $0

G) INDIRECT COSTS
An indirect cost is the applicant’s incurred cost that cannot be readily isolated or identified with just one project or activity. These types of costs are often referred to as “overhead costs.” Typical examples of indirect costs are general telephone service, postage, office supplies, office space expenses, and administrative or financial operations for Applicants may choose to:
• Not request any indirect costs;
• Use a current approved indirect cost rate with a federal agency or one pending review to be approved by the project start date (applicants choosing this option must attach supporting documentation to application); or • Use an indirect cost rate not to exceed 10% of modified total direct costs (MDTC). MTDC means all direct salaries and wages, applicable fringe benefits, materials and supplies, services, travel, and subcontracts up to the first $25,000 of each subcontract.

Indirect cost rate applied (%):

Grant Funds Requested Cash Match & In-Kind Total Description Details Indirect Costs Total: $0
Description should explain what is being included in indirect costs.

Typical examples of indirect costs are general telephone service, postage, office supplies, office space expenses, and administrative or financial operations for an entire organization.

Indirect Costs Description (please include a detailed breakdown of your indirect cost calculation) :

GRAND TOTAL
Grant Funds Requested Cash Match & In-Kind Total
Grand Total: $0 $0 $0
216

Library Courts Building 916-323-9759
P.O. Box 942837 [email protected]
Sacramento, CA 94237-0001 www.library.ca.gov
January 27, 2026
Justin Clifton, City Manager
Murrieta Public Library
1 Town Square
Murrieta, CA 92562
Dear City Manager Justin Clifton:

We are pleased to approve the grant application for the LATL Summer 2026 project for a total of $12,362 in state grant funds. Murrieta Public Library will receive $12,362 of the award upon execution and approval of the grant agreement, certification, and claim forms.

Hard copies of this correspondence will not follow. Keep the entirety of the correspondence for your files and consider these award materials your original documents.

This grant is governed by the attached Grant Agreement and Certification of Compliance, which includes the project period, reporting requirements, and payment schedule. Your approved budget is attached and can also be found in our grant management system. Login to view and manage your grant here: www.gotomygrants.com.

Please sign the claim and certification forms at the back of your award packet using the DocuSign system. Should you have any questions regarding the use of DocuSign please contact your grant monitor.

Upon receipt of a completed claim form that is free of errors or inaccurate information, the State Library processes it for routing to the Office of the State Controller which ultimately issues the check. The total time for the claim form to be processed, routed, payment issued, and mailed can be up to eight weeks, but is often a shorter timeframe. If you still have not received payment after eight weeks, please contact your grant monitor.

The Grant Monitor assigned to your project is Robyn McCreight. Robyn is available to assist you throughout the year and can be reached via email at [email protected]. Please stay in touch with your Grant Monitor throughout the award period. Read the enclosed award packet thoroughly and contact your Grant Monitor if you have any questions.

Best wishes for a successful project.

Respectfully yours,
Greg Lucas
California State Librarian
217
Library Courts Building 916-323-9759
P.O. Box 942837 [email protected]
Sacramento, CA 94237-0001 www.library.ca.gov

THE BASICS YOUR GRANT AWARD
The following provides all the basic information about your grant and managing your grant.

Award #: LATL25-41A
Library/Organization: Murrieta Public Library
Project Title: LATL Summer 2026
Award Amount: $12,362
Start Date: February 1, 2026
End Date: January 31, 2027
Please understand that it can take from six to eight weeks before grant funds are delivered.

If you have not received your payment after eight weeks, please contact your grant monitor.

REPORTING
Lunch at the Library participants are required to provide financial and narrative reports as outlined in the grant terms and conditions (May 30, 2026, August 30, 2026, November 30, 2026, and Outputs Forms and Outcomes Surveys due September 10, 2026); final financial and narrative reports by February 28, 2027; and updates upon request. Reports will be submitted to the grant management system here: www.gotomygrants.com.

PAYMENTS
Please note this clarification regarding payments. Grant payments will be made based on the payment schedule laid out in the Grant Term and Award Documentation. See item 41 in the Terms and Conditions to view the payment schedule for your grant.

CONTACT
We want your project to be successful. Please work with the grant monitor and project consultant in implementing your project:

Grant Monitor: Robyn McCreight
Monitor Phone Number: 916-603-6716
Monitor Email Address: [email protected]
Project Consultant Kaela Villalobos
Consultant Email Address [email protected] Cc:

JoLene Aguayo Vert, [email protected]
Robyn McCreight, [email protected]
Kaela Villalobos, [email protected]
[email protected]
218

STATE-FUNDED GRANTS

AWARD AGREEMENT AND

CERTIFICATE OF COMPLIANCE
219
Murrieta Public Library
LATL Summer 2026
2025-2026 LATL25-41A

TABLE OF CONTENTS

PROJECT SUMMARY

2 PROCEDURES and REQUIREMENTS

3 A. Term of the Agreement

3 B. Scope of Work

3 C. Budget Detail

3 D. Narrative and Financial Reports

4 E. Claim Form and Payment

5 EXHIBIT A: TERMS and CONDITIONS

7 EXHIBIT B: CERTIFICATION of COMPLIANCE FORMS 22

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PROJECT SUMMARY
AWARD AGREEMENT BETWEEN THE STATE LIBRARY and Murrieta Public Library for the Lunch at the Library Summer 2026 project.

AWARD AGREEMENT NUMBER LATL25-41A
This Award February 1, 2026
Murrieta Public
Library
-funded Lunch at the
Library Summer 2026 project.
administers state and federal funds in the form of awards.

The Grantee was selected by the State Library to receive state grant funds in the amount of $12,362 through the process adopted by the State Library in administering such grants.

The State Library and the Grantee, for the consideration and under the conditions hereinafter set forth in the Grant Agreement, agree as follows:

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PROCEDURES and REQUIREMENTS
A. Term of the Agreement
The Grant term begins on the date of execution of the Agreement by both parties, until January 31, 2027. If completion of the project occurs prior to the end of the grant period this will be the end date of the term of this agreement. Grant eligible program expenditures may begin no earlier than the start date. The project period ends on January 31, 2027 and all eligible program costs must be incurred by this date.

B. Scope of Work

1. application and submitted to the State Library in response to the Lunch at the Library Summer 2026.

2. The following activities and deliverables to be performed by the Grantee include, but are not limited to the following:

Maintain and keep records of expenditures related to the grant that are consistent with Generally Acceptable Accounting Practices (GAAP).

Make financial records available to the State Library upon request.

Work with the State Library staff to assure that funds are disbursed in compliance with the purpose of the grant.

Prepare and submit required narrative and financial reports.

Procure equipment, and other supplies as needed for the project.

Issue contracts for services, personnel, and consultants as needed for the project.

If applicable, make payments for services, including for hours worked and travel reimbursements, to consultants and contractors.

Oversee the implementation of project activities.

C. Budget Detail
The State Library shall provide the Grantee funding for the expenses incurred in Grantee shall request the distribution of grant funding consistent with its proposal and 222
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the budget worksheet that was included with the application. Under no circumstances shall payments exceed the total grant amount identified in this Agreement.

D. Narrative and Financial Reports

1. The Grantee shall be responsible for submission of interim and final narrative and financial reports on the progress and activities of the project, to the California State Library, using the sample report documents provided by the California State Library.

2. All the reports must be current, include all required sections and documents, and must be approved by the Grant Monitor before any payment request can be processed. Failure to comply with the specified reporting requirements may be considered a breach of this Agreement and result in the termination of the Agreement or rejection of the payment request and/or forfeiture by the Grantee of claims for costs incurred that might otherwise have been eligible for grant funding. Any problems or delays must be reported immediately to the Grant Monitor. The financial reports shall reflect the expenditures made by the Grantee under the Agreement and may be incorporated into the same reporting structure as the narrative reports.

3. The reports shall be submitted by the following dates:

Reporting Period Report Due Date
February 1, 2026
April 30, 2026
1st Financial Reporting Period Report and
Mid-Project Narrative Report
May 30, 2026
May 1, 2026 July
31, 2026
2nd Financial Reporting Period Report and
Mid-Project Narrative Report
August 30, 2026
Summer 2026 Annual Outputs Form and Outcomes
Surveys Due
September 10,
2026
August 1, 2026
October 31, 2026
3rd Financial Reporting Period Report Due November 30,
2026
November 1, 2026
January 31,
2027
Final Financial Reporting Period Report and
Final Narrative Report Due
February 28, 2027

4. Failure to submit timely reports with the appropriate documentation by the due date may result in rejection of the payment request and/or forfeiture by the Grantee of claims for costs incurred that might otherwise have been eligible for grant funding.
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5. The Grantee agrees to maintain records and supporting documentation pertaining to the performance of this grant, subject to possible audit for a minimum of five (5) years after final payment date or grant term end date, whichever is later. Please refer to Exhibit A, Terms and Conditions for more information.

6. In addition to the foregoing, the Grantee shall submit to the State Library such periodic reports, updates, documents and any information as deem necessary by the State Library to monitor compliance and/or perform program evaluation. Any requested data or information shall be submitted in electronic format on a form specified by the State Library.

E. Claim Form and Payment

1. The California State Library shall provide the Grantee payment as outlined in the payment schedule only if all requirements for claiming the funds as outline in this document have been met, and only for those activities and costs specified in the approved award application.

2. The Grantee shall complete, sign, and submit Certification of Compliance form (Exhibit B) and the Financial Claim form (included in your award packet), to the California State Library within 14 days of receiving this award packet. These forms will be issued, signed, and submitted using the online signature and agreement platform, DocuSign, unless DocuSign is unallowable or inconsistent with practices and policies of the local jurisdiction. If the use of DocuSign is not acceptable to your organization, please contact your grant monitor regarding alternate options.

3. Any of the sums appearing under the categories in the approved budget may be adjusted with prior authorization from the California State Library Grant Monitor. This would be to increase the allotment with the understanding that there will be corresponding decreases in the other allotments so that the total amount paid by the California State Library to the Grantee under this Agreement shall not exceed the awarded amount, which shall be expended/encumbered during the grant period.

4. If the payment amount made by the California State Library exceeds the actual expenses incurred during the term of this Agreement, as reflected in the financial reports to be filed by the Grantee, the Grantee shall immediately refund the excess payment amount to the California State Library.

5. responsibility to pay all contractors and subcontractors for purchased goods and services.
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6. The Final Payment of 10% (if applicable) will be withheld and retained by the California State Library until all conditions agreed upon in this Agreement, including submission and grant monitor approval of the interim and final narrative and financial reports, have been satisfied.

7. Prompt Payment Clause
The California State Library will make payments to the Grantee in accordance with the Prompt Payment Clause under Government Code, section 927, et. seq.

The Grantee may typically expect payment within 45 days from the date a grant payment request is properly submitted and approved by the Grant Monitor.

8. Budget Contingency Clause
a. It is mutually agreed that if the Budget Act of the current fiscal year or any subsequent years covered under this Agreement does not appropriate sufficient funds for the program, this Agreement shall no longer be in full force and effect. In this event, the California State Library shall have no liability to pay any funds whatsoever to the Grantee or to furnish any other considerations under this Agreement and the Grantee shall not be obligated to perform any provisions of this Agreement.
b. If funding for any fiscal year is reduced or deleted by the Budget Act for purposes of this Program, the California State Library shall have the option to either cancel this Agreement with no liability occurring to itself or offer an Agreement amendment to the Grantee to reflect the reduced amount.

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EXHIBIT A: TERMS and CONDITIONS

1. Accessibility: The State is responsible for ensuring that public websites are accessible to both the general public and state employees, including persons with disabilities. Grantee shall assist the State in meeting its responsibility. Therefore, all project materials generated by state funded programs must meet the California Accessibility Standards. Additionally all project materials designed, developed, and maintained shall be in compliance with the California Government Code, sections 7405 and 11135, and the current Web Content Accessibility Guidelines, as published by the Web Accessibility Initiative of the World Wide Web Consortium at a minimum Level AA success criteria.

However, if for some reason project material is not generated to be in compliance to meet these standards, please still submit it to the State Library. When submitting

The California State Library reserves the right to post project materials to its website that are in compliance with these standards.

2. Acknowledgment: The State of California and the California State Library shall be acknowledged in all promotional materials and publications related to Lunch at the Library Summer 2026.
a. Grant award recipients must ensure that the State of California receives full credit as the source of funds and that the California State Library, likewise, is acknowledged as the administrator.
b. Publications and information releases about the project must credit the State of California. An appropriate statement for a publication or project press release is:
[publication/project] was supported in whole or in part by funding provided by the State of California, administered by the California State Library
Grantees must include the above statement in any publications, vehicle wraps, and promotional materials, including websites. If space is limited the State Library logo and the following shortened acknowledgement statement is acceptable:

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c. This credit line on products of a project, such as materials, is important to foster support from the public, and state funding sources. d. California State Library Logo: Use of the California State Library logo, which can be downloaded on the California State Library website, is required on any publication, vehicle wrap, or promotional material along with the above statement(s).
e. Photo Documentation: Digital photos are a great way to document the happenings of your project. It is recommended that you use a photo release release form, or

3. Agency: In the performance of this Agreement the Grantee and its agents and employees shall act in an independent capacity and not as officers, employees or agents of the California State Library. The Grantee is solely responsible for all activities supported by the grant. Nothing in this Agreement creates a partnership, agency, joint venture, employment, or any other type of relationship between the parties. The Grantee shall not represent itself as an agent of the California State Library for any purpose, and has no authority to bind the State Library in any manner whatsoever.

4. Amendment: No amendment or variation of the terms of this Agreement shall be valid unless made in writing, signed by the parties, and approved as required.

No oral understanding or agreement not incorporated into this Agreement is binding on any of the parties. This Agreement may be amended, modified or augmented by mutual consent of the parties, subject to the requirements and restrictions of this paragraph.

5. Applicable law: The laws of the State of California shall govern all proceedings concerning the validity and operation of this Agreement and the performance of the obligations imposed upon the parties hereunder. The parties hereby waive any right to any other venue. The place where the Agreement is entered into and place where the obligation is incurred is Sacramento County, California.

6. Assignment, Successors, and Assigns: The Grantee may not assign this Agreement or delegate its performance to any third-party person or entity, either provisions of this Agreement shall be binding upon and inure to the benefit of the California State Library, the Grantee, and their respective successors and assigns.

7. Audit and Records Access: The Grantee agrees that the California State Library, the Department of General Services, the State Auditor, or their designated representatives shall have the right to review, audit, inspect and copy any records and supporting documentation pertaining to the performance of this Agreement. The Grantee agrees to maintain such records for possible audit for a minimum of five (5) years after the final payment, or grant term end date, whichever is later, unless a longer period of records retention is stipulated, or until 227
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completion of any action and resolution of all issues which may arise as a result of any litigation, dispute, or audit, whichever is later. The Grantee agrees to allow the auditor(s) access to such records during normal business hours and to allow interviews of any employees who might reasonably have information related to such records. Further, the Grantee agrees to include a similar right of the State to audit records and interview staff in any subcontract related to performance of this Agreement.

Examples of audit documentation may include, but not limited to, competitive bids, grant amendments, if any, relating to the budget or work plan, copies of any agreements with contractors or subcontractors if utilized, expenditure ledger, payroll register entries, time sheets, personnel expenditure summary form, travel expense log, paid warrants, contracts and change orders, samples of items and materials developed with grant funds, invoices and/or cancelled checks.

8. Authorized Representative: Grantee and the California State Library mutually represent that their authorized representatives have the requisite legal authority

9. Communication: All communications from either party, including an interim check-in at any time during the grant term, shall be directed to the respective grant manager or representative of the California State Library or Grantee. For this purpose, the following contact information is provided below:

Murrieta Public Library
Justin Clifton
1 Town Square
Murrieta, CA 92562
951304-2478
[email protected]

California State Library
Robyn McCreight
900 N Street
Sacramento, CA 95814
916-603-6716
[email protected]
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1. Confidentiality: Grantee will maintain as confidential any material it receives or produces that is marked Confidential or is inherently confidential or is protected by privilege. Grantee agrees to alert the State Library to this status in advance, and State Library agrees to maintain this status in conformity with the Public Records Act.

2. Contractor and Subcontractors: Nothing contained in this Grant Agreement or otherwise shall create any contractual relation between the State and any contractor or subcontractors, and no contract or subcontract shall relieve the Grantee of his or her responsibilities and obligations hereunder. The Grantee agrees to be as fully responsible to the State for the acts and omissions of its contractors, subcontractors, volunteers, student interns and of persons either directly or indirectly employed by any of them as it is for the acts and omissions of persons contractors and subcontractors is an independent obligation from the shall have no obligation to pay or to enforce the payment of any monies to any contractor or subcontractor.

3. Copyright: Grantee owns and retains titles to any copyrights or copyrightable material from any original works that it creates within the scope of this Agreement in accordance with the federal Copyright Act. (17 U.S.C. 101, et seq.) Grantee is responsible for obtaining any necessary licenses, permissions, releases or authorizations to use text, images, or other materials owned, copyrighted, or trademarked by third parties and for extending such licenses, permissions, releases, or authorizations to the California State Library pursuant to this section. Also, the California State Library may upload, post or transmit copyrighted material produced or purchased with grant funds on a California State Library website for public access and viewing.

4. Discharge of Grant Obligations: The Grantee's obligations under this Agreement shall be deemed discharged only upon acceptance of the final report by California State Library. If the Grantee is a non-profit entity, the e final
report prior to its submission to California State Library.

5. Dispute Resolution: In the event of a dispute, Grantee will discuss the problem informally with the Grant Monitor. If unresolved, the Grantee shall Monitor within
ten (10) days of discovery of the problem. Within ten (10) days of receipt, the Grant Monitor shall meet with the Grantee for purposes of resolving the dispute. Any dispute arising under the terms of this Agreement which is not disposed of within a reasonable period of time, the Grantee may bring it to the attention of the State Librarian or the designated representative. The decision of the State Librarian or designated representative shall be final. 229
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Unless otherwise instructed by the Grant Monitor, the Grantee shall continue with its responsibilities under this Agreement during any dispute.

6. Drug-free Workplace: The Grantee certifies under penalty of perjury under the laws of California, that the Grantee will comply with the requirements of the Drug-Free Workplace Act of 1990 (Gov. Code, § 8350 et. seq.) and will provide a drug-free workplace by taking the following actions:
a. Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations.
b. Establish a Drug-Free Awareness Program to inform employees about all of the following:
1) The dangers of drug abuse in the workplace.
2) -free workplace;
3) Any available counseling, rehabilitation and employee assistance programs.
4) Penalties that may be imposed upon employees for drug abuse violations.
c. Require that every employee who works on the Agreement will:
1) -free workplace policy
statement.
2)
condition of employment on the Agreement.

Failure to comply with these requirements may result in suspension of payments under the Agreement or termination of the Agreement or both and grantee may be ineligible for award of any future state agreements if the California State Library determines that the grantee has made a false certification or violated the certification by failing to carry out the requirements as noted above.

7. Effectiveness of Agreement: This Agreement is of no force or effect until signed by both parties.

8. Entire Agreement: This Agreement supersedes all prior agreements, oral or written, made with respect to the subject hereof and, together with all attachments hereto, contains the entire agreement of the parties.

9. Exclusive Agreement: This is the entire Agreement between the California State Library and Grantee.

10. Executive Order N-6-22-Russia Sanctions: The Grantee shall comply with Executive Order N-6-22 (the EO) regarding Economic Sanctions against Ukraine, as well as any sanctions imposed under state law. The EO directs state agencies to terminate grant agreements with, and to refrain from entering any new grant agreements with, individuals or entities that are 230 Murrieta Public Library
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determined to be a target of Economic Sanctions. Accordingly, should the State determine Grantee is a target of Economic Sanctions or is conducting prohibited transactions with sanctioned individuals or entities, that shall be grounds for termination of this agreement. The State shall provide Grantee advance written notice of such termination, allowing Grantee at least 30 calendar days to provide a written response. Termination shall be at the sole discretion of the State.

11. Extension: The State Librarian or designee may extend the final deadline for must be made in writing and received by the California State Library at least 30 days prior to the final deadline.

12. Failure to Perform: The grant being utilized by the Grantee is to benefit the Lunch at the Library Summer 2026. If the Grant Monitor determines the Grantee has not complied with this Agreement, the Grantee may forfeit the right to reimbursement of any grant funds not already paid by the California State Library, including, but not limited to, the ten percent (10%) withhold.

13. Federal and State Taxes: The State Library shall not:
a. Withhold Federal Insurance Contributions Act (FICA) payments from behalf; or
b. Make Federal or State unemployment insurance contributions on

c.

Grantee shall pay all taxes required on payments made under this Agreement including applicable income taxes and FICA.

14. Force Majeure: Neither the California State Library nor the Grantee, its contractors, vendors, or subcontractors, if any, shall be responsible hereunder for any delay, default, or nonperformance of this Agreement, to the extent that such delay, default, or nonperformance is caused by an act of God, weather, accident, labor strike, fire, explosion, riot, war, rebellion, sabotage, flood, or other contingencies unforeseen by the California State Library or the Grantee, its contractors, vendors, or subcontractors, and beyond the reasonable control of such party.

15. Forfeit of Grant Funds and Repayment of Funds Improperly Expended: If grant funds are not expended, or have not been expended, in accordance with this Agreement, the State Librarian or designee, at his or her sole discretion, may take appropriate action under this Agreement, at law or in equity, including requiring the Grantee to forfeit the unexpended portion of the grant funds, including, but not limited to, the ten percent (10%) withhold, and/or to repay to the California State Library any funds improperly expended.
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16. Fringe Benefit Ineligibility: Grantee agrees that neither the Grantee nor its employees and contract personnel are eligible to participate in any employee pension, health benefit, vacation pay, sick pay or other fringe benefit plan of the State of California or the State Library.

17. Generally Accepted Accounting Principles: The Grantee is required to use Generally Accepted Accounting Principles in documenting all grant expenditures.

18. Grant Monitor:
progress, and reviewing and approving Grant Payment Requests and other documents delivered to the California State Library pursuant to this Agreement. The Grant Monitor may monitor Grantee performance to ensure Grantee expends grant funds appropriately and in a manner consistent with the terms and conditions contained herein. The Grant Monitor does not have the authority to approve any deviation from or revision to the Terms and Conditions (Exhibit A) or the Procedures and Requirements unless such authority is expressly stated in the Procedures and Requirements.

19. Grantee: the government or legal entity to which a grant is awarded and which is accountable to the California State Library for the use of the funds provided.
a. The grantee will make reports to the State Librarian in such form and containing such information as may be required to ensure the proper agreement. The grantee will keep such records and afford such access as the California State Library may find necessary to assure the correctness and verification of such reports.

20. Grantee Accountability: The Grantee is ultimately responsible and accountable for the manner in which the grant funds are utilized and accounted for and the way the grant is administered, even if the Grantee has contracted with another organization, public or private, to administer or operate its grant program. In the event an audit should determine that grant funds are owed to the California State Library, the Grantee is responsible for repayment of the funds to the California State Library.

21. Grantee Funds: It is mutually agreed that the Grantee is responsible for furnishing funds beyond the grant award that may be necessary to complete the project.

22. Independent Action: Grantee reserves the right to fulfill its obligations under this Agreement in an independent manner, at any location and at any time within the agreed-
personnel shall perform all services required by this Agreement, but their time need not be devoted solely to fulfilling obligations under this Agreement. Grantee shall furnish all equipment and materials used to meet its obligations, and complete the Project. The State Library shall not provide 232 Murrieta Public Library
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any personnel or other resources beyond the grant award, and is not required to provide training in connection with this Agreement.

23. Indemnification: Grantee agrees to indemnify, defend and save harmless the State of California, the California State Library and its officers, employees, and agents, from any and all claims, losses, and liabilities accruing or resulting to any and all contractors, subcontractors, suppliers, laborers and any other person, firm or corporation furnishing or supplying work services, materials, or supplies in connection with the performance of this Agreement, and from any and all claims and losses accruing or resulting to any person, firm or corporation who may be injured or damaged by Grantee in the performance of this Agreement.

24. License to Use: The California State Library reserves a fully paid-up, royalty- free, nonexclusive, sub-licensable and irrevocable license to reproduce, publish, prepare derivative works, distribute or otherwise use, and to authorize third parties to use, any material received or maintained by Grantee in connection with this Agreement. This includes intellectual property, with or without third-party rights. All such usages will be for public library and State governmental purposes:

a. The copyright in any work developed under this grant, sub-grant, or contract under this grant or sub-grant; and
b. Any rights of copyright to which a Grantee, sub-grantee, or a contractor purchases ownership with grant support.

25. Limitation of Expenditure: Expenditure for all projects must conform to the approved budget and with applicable State laws and
regulations. The total amount paid by the California State Library to the Grantee under this agreement shall not exceed $12,362 and shall be expended/encumbered in the designated award period.

During the award period, the grantee may find that the awarded budget may need to be modified. Budget changes, requests for additional funds, or requests for reductions in award funding must be discussed with the assigned State Library Grant Monitor and a Grant Award Modification may be required to be submitted according to the instructions. Approval is by the State Librarian or their designee. Adjustments should be reported on the next financial report. Any adjustments in approved budgets must be documented and documentation retained in project accounts.

26. Lobbying: Grantee confirms that the grant funds will not be used for the purposes of lobbying or otherwise attempting to influence legislation, as those purposes are defined by the U.S. Internal Revenue Code of 1986.

27. Non-Discrimination Clause: During this grant period, the Grantee and the 233
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harass, or allow harassment against any employee or applicant for employment because of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, age, sexual orientation, or military and veteran status. Grantee shall insure that the evaluation and treatment of contractors, employees and applicants for employment are free from such discrimination and harassment.

Additionally, Grantee, contractors, and subcontractors, if applicable, shall comply with the provisions of the Fair Employment and Housing Act (Gov.

Code §12900 et seq.), the regulations promulgated thereunder (Cal. Code Regs., tit. 2, §11000 et seq.), the provisions of Article 9.5, Chapter 1, Part 1, Division 3, Title 2 of the Government Code (Gov. Code §§ 11135-11139.5), and the regulations or standards adopted by the California State Library to implement such article.

Grantee shall permit access by representatives of the Department of Civil Rights and the California State Library upon reasonable notice at any time to such of its books, records, accounts, and all other sources of information and its facilities as said Department or the California State Library shall require ascertaining compliance with this clause. Grantee, and its contractors, and subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement. (See Cal. Code Regs., tit. 2, §11105.) Grantee shall include the non-discrimination and compliance provisions of this clause in all contracts and subcontracts to perform work under the Agreement.

28. Notices: All notices and other communications in connection with this Agreement shall be in writing, and shall be considered delivered as follows:
a. Electronic Mail (E-mail):When sent by e-mail to the last e-mail address of the recipient known to the party giving notice. Notice is effective upon transmission.
b. DocuSign (e-signature platform): When sent via DocuSign a notification will be sent to the last e-mail address of the recipient known to the party giving notice. Notice is effective upon transmission.
c. Grants Management System: When sent via / uploaded to the will be sent to the last e-mail address of the recipient known to the party giving notice. Notice is effective upon transmission. d. Personally:
address as stated in this Agreement.
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e. U.S. Mail: Five days after being deposited in the U.S. Mail, postage Agreement.

29. Order of Precedence: The performance of this Agreement shall be conducted in accordance with the Terms and Conditions, Procedures and Requirements, Certificate of Compliance, Project Summary, Activities Timeline, and Budget, of this Agreement, or other combination of exhibits specified on the Grant Agreement Coversheet attached hereto -
incorporated
herein by this reference. In the event of conflict or inconsistency between the articles, exhibits, attachments, specifications or provisions that constitute this Agreement, the following order of precedence shall apply:
a. Grant Agreement Coversheet and any Amendments thereto b. Terms and Conditions
c. Procedures and Requirements
d. Certificate of Compliance
e. Project Summary
f. (including Budget and Activities Timeline)
g. All other attachments hereto, including any that are incorporated by reference.

30. Payment:
a. The approved Budget, if applicable, is attached hereto and incorporated herein by this reference and states the maximum amount of allowable costs for each of the tasks identified in the Project Summary and Activity Timeline included in the project application. California State Library shall provide funding to the Application at only those costs specified in the Budget and incurred in the term of the Agreement.
b. The Grantee shall carry out the work described in the Work Plan or in or modifications to the Work Plan, approved project as described in performing the changed work or incurring the changed cost. If the Grantee fails to obtain such prior written approval, the State Librarian or designee, at his or her sole discretion, may refuse to provide funds to pay for such work or costs.
c. The Grantee shall request funds in accordance with the funding schedule included in this agreement.
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d. Ten percent (10%) will be withheld from the Payment Request (if applicable) and paid at the end of the grant term, when all reports and conditions stipulated in this Agreement have been satisfactorily completed. Failure by the grantee to satisfactorily complete all reports and conditions stipulated in this Agreement may result in forfeiture of any such funds withheld.
e.
to the amounts authorized in the California State Administrative Manual (contact the Grant Monitor for more information). f. Payment will be made only to the Grantee.
g. Reimbursable expenses shall not be incurred unless and until the grantee receives a Notice to Proceed as described in the Procedures and Requirements.

31. Personal Jurisdiction: The Grantee consents to personal jurisdiction in the State of California for all proceedings concerning the validity and operation of this Agreement and the performance of the obligations imposed upon the parties. Native American Tribal grantees expressly waive tribal sovereign immunity as a defense to any and all proceedings concerning the validity and operation of this Agreement and the performance of the obligations imposed upon the parties.

32. Personnel Costs: Any personnel expenditures to be paid for with grant funds must be computed based on actual time spent on grant-related activities and on the actual salary or equivalent hourly wage the employee is paid for their regular job duties, including a proportionate share of any benefits to which the employee is entitled.

33. Pledge: This Agreement shall not be interpreted to create any pledge or any commitment by the State Library to make any other or further grants or contributions to Grantee, or any other person or entity in connection with the Project. It is mutually agreed that Grantee is responsible for furnishing funds beyond the grant award that may be necessary to complete outcomes or deliverables.

34. Privacy Protection: Both parties agree to protect the confidentiality of any non-public, personal information that may be contained in materials received or produced in connection with this Agreement, as required by Civil Code, section 1798, et. seq.

35. Prohibited Use: The expenditure under this program shall not be used to supplant Grantee efforts in other grant programs provided by the California State Library.

36. Public Records Act: Material maintained or used by the California State 236
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Government Code, sections 6250, et. seq. This includes the Interim and Final reports, and any other written communications between the parties.

Grantee agrees to ensure that all content contained in its written reports are appropriate for publication. Said material, along with all other reports, documentation and data collected during the term of the Agreement, will be subject to disclosure unless it qualifies for exemption under the PRA in whole or in part. Grantee agrees to alert the State Library as to a basis for exemption, if any exists.

37. Publicity Obligations: Grantee will notify the State Library of any promotional materials or publications resulting from the grant no later than five (5) days in advance of distribution, whether they are print, film, electronic, or in any other format or medium. Copies of all promotional materials will be provided to the State Library. Grantee will acknowledge as noted above. Grantee agrees that the State
Library may include information about this grant and its outcomes in its own annual reports, with specific reference to Grantee, and may distribute such information to third parties.

38. Records: Communications, grant related documents, data, original receipts, and invoices must be maintained by Grantee and shall be made available to the State Library upon request. Grantee agrees to maintain adequate grant program records and adequate financial records consistent with generally accepted accounting practices, and to retain all records for at least five (5) years after the end-of-term. The State Library ensure compliance with this Agreement, with reasonable advance notice.

39. Reduction of Waste: In the performance of this Agreement, Grantee shall take all reasonable steps to ensure that materials purchased or utilized in the course of the project are not wasted. Steps should include, but not be limited to: the use of used, reusable, or recyclable products; discretion in the amount of materials used; alternatives to disposal of materials consumed; and the practice of other waste reduction measures where feasible and appropriate.

40. Reimbursement Limitations: Under no circumstances shall the Grantee seek reimbursement pursuant to this Agreement for a cost or activity that has been or will be paid for through another funding source. The Grantee shall not seek reimbursement for any costs used to meet cost sharing or matching requirements of any other California State Library funded program.

41. Reports and Claims: It is the responsibility of the grantee make the required reports and claims to the California State Library.
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a. The grantee shall be responsible for submitting to the State Library Narrative Reports detailing progress and activities. The reports are due on the dates specified in the reporting schedule detailed in the Procedures and Requirements section.
b. The grantee shall be responsible for submitting to the State Library Financial Reports reflecting grantee expenditure activity. The reports are due on the dates specified in the reporting schedule detailed in the Procedures and Requirements section.
c. To obtain payment hereunder the grantee shall submit authorized claims provided by the State Library for that purpose, on each of the following mentioned dates for payment, and the California State Library agrees to reimburse the Library as soon thereafter as State fiscal procedures will permit.
d. The final 10% of the grant award (if applicable) is payable only upon approval of all final reports and receipt of claim form. Failure to administrative duty under the award.
e. Payment will be provided to cover the expenditures incurred by the grantee for the project in the following manner:
o $12,362 upon execution of the agreement and submission of claim by the grantee organization.
o If applicable, final payment will be made upon approval of all final reports and receipt of claim form in the amount of $ 0

42. Self- All expenditures for which
reimbursement pursuant to this Agreement is sought shall be the result of -length transactions and not the result of, or motivated by, self-dealing on the part of the Grantee or any employee or agent of the Grantee. For -
both parties are on equal footing and fair market forces are at play, such as whe
-
where an individual or entity is obligated to act as a trustee or fiduciary, as when handling public funds, and chooses to act in a manner that will benefit the individual or entity, directly or indirectly, to the detriment of, and in conflict with, the public purpose for which all grant monies are to be expended.

43. Severability: If any part of this Agreement is found to be unlawful or unenforceable, such provisions will be voided and severed from this Agreement, but the remainder of the provisions in the Agreement will remain in full force and effect.

44. Site Visits: The Grantee shall allow the California State Library to access and conduct site visits, with reasonable notice, at which grant funds are 238 Murrieta Public Library
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expended and related work being performed at any time during the performance of the work and for up to ninety (90) days after completion of the work, or until all issues related to the grant project have been resolved.

A site visit may include, but not be limited to, monitoring the use of grant funds, provide technical assistance when needed, and to visit the State funded project.

45. Termination: The Agreement shall be subject to termination by the State Librarian or designee upon notice to the Subrecipient at least thirty (30) days prior to the effective date of termination. In the event this agreement is terminated, the Subrecipient shall deliver to the State Librarian copies of all reports, accounting, data, and materials prepared up to the date of termination. The State Librarian shall determine, and pay the Subrecipient for necessary and appropriate expenditures and obligations up to the date of termination which have not been covered by prior installments previously paid to the Subrecipient.
a. Upon such termination, the unused portion of the grant award must be returned to the California State Library within 45 days. If funding has been advanced to the Subrecipient, any unobligated balances, as determined by the State Librarian, shall be returned to the State Library within 45 days of the notice of termination.
b. However, if the California Governor, Legislature, or any other controlling authority takes action to include, but not limited to, rescinding, cancelling, withdrawing or taking away a grant program, award, money, or any other form of compensation for a grant, through legislation, executive order, directive or any other type of authority then sub-section (a) above is void. Section (b) would control and take precedence over sub-section (a) making the 30 day and 45 day clauses above void. The grantee would be required to immediately return any money, award, or any other type of compensation to the State Library.

46. Timeline: Time is of the essence to this Agreement. It is mutually agreed between the parties that the grant application and the timeline included therein are part of the Agreement.

47. Unused Funds: At the end-of-term Grantee agrees to return any unexpended or unaccounted for funds to the State Library, or to submit a written request for an extension of the grant period. Funds will be considered unexpended or unaccounted if they were: (1) not used for their intended purpose, or (2) used inconsistent with the terms of this Agreement.

Funds will also be considered unaccounted for, and must be returned, if the proposal outcomes or deliverables are materially incomplete by the end-of-239 Murrieta Public Library
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term or earlier termination, as determined by the State Library in its sole discretion.

48. Waiver of Rights: California State Library shall not be deemed to have waived any rights under this Agreement unless such waiver is given in writing and signed by California State Library. No delay or omission on the part of California State Library in exercising any rights shall operate as a waiver of such right or any other right. A waiver by California State Library of a provision of this Agreement shall not prejudice or constitute a waiver of t compliance with
that provision or any other provision of this Agreement. No prior waiver by California State Library, nor any course of dealing between California State Library and Grantee, shall constitute a waiver of any of California State transactions. Whenever the consent of California State Library is required under this Agreement, the granting of such consent by California State Library in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in the sole discretion of California State Library.

49. Work Products: Grantee shall provide California State Library with copies of all final products identified in the Work Plan and Application. Grantee shall also provide the State Library with copies of all public education and advertising material produced pursuant to this Agreement.

50. The
personnel. If Grantee hires employees to perform services required by this e for
them. The Grantee is aware of Labor Code Section 3700, which requires to undertake self-insurance in accordance with the Labor Code, and the Grantee agrees to comply with such provisions before commencing the performance of the work of this Agreement.
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EXHIBIT B: CERTIFICATION of COMPLIANCE FORM

1. AUTHORIZED REPRESENTATIVE: I certify that the authorized representative named below is the legally designated representative of the Grantee for this Grant Agreement and project and is authorized to receive and expend funds in order to administer this grant program.

2. I certify that all information provided to the California State Library for review in association with this award is correct and complete to the best of my knowledge, and as the authorized representative of the Grantee, I commit to the conditions of this award, and I have the legal authority to do so.

3. I certify that any or all other participants or contractors in the grant program have agreed to the terms of the application/grant award and have entered into an agreement(s) concerning the final disposition of equipment, facilities, and materials purchased for this program from the funds awarded for the activities and services described in the attached, as approved and/or as amended in the application by the California State Librarian.

4. The authorized representative, on behalf of the Grantee, certifies that the Grantee will comply with all applicable requirements of State and Federal laws, regulations, and policies governing this program, to include the requirements listed below in this Certification of Compliance Form.

5. The authorized representative, on behalf of the Grantee, hereby certifies to the California State Library, for an award of funds in the amount $12,362 This award will provide library services as set forth in the Project Application as approved and/or as amended by the California State Librarian.

6. STATEMENT OF COMPLIANCE: Grantee has, unless exempted, complied with the non-discrimination program requirements. (Gov. Code §12990 (a-f) and CCR, Title 2, Section 11102).

7. DRUG-FREE WORKPLACE REQUIREMENTS: Grantee will comply with the requirements of the Drug-Free Workplace Act of 1990 and will provide a drug-free workplace by taking the following actions:
a. Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations.
b. Establish a Drug-Free Awareness Program to inform employees about:
1) the dangers of drug abuse in the workplace;
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2) the person's or organization's policy of maintaining a drug-free workplace;
3) any available counseling, rehabilitation and employee assistance programs; and,
4) penalties that may be imposed upon employees for drug abuse violations.
c. Every employee who works on the proposed Agreement will:
1) receive a copy of the company's drug-free workplace policy statement; and,
2) agree to abide by the terms of the company's statement as a condition of employment on the Agreement.

Failure to comply with these requirements may result in suspension of payments under the Agreement or termination of the Agreement or both and Grantee may be ineligible for award of any future State agreements if the department determines that any of the following has occurred: the Grantee has made false certification or violated the certification by failing to carry out the requirements as noted above. (Gov. Code § 8350 et. seq.)

8. CONFLICT OF INTEREST: Grantee needs to be aware of the following provisions regarding current or former state employees. If Grantee has any questions on the status of any person rendering services or involved with the Agreement, the California State Library must be contacted immediately for clarification.

Current State Employees (Pub. Contract Code § 10410):
a. No officer or employee shall engage in any employment, activity or enterprise from which the officer or employee receives
compensation or has a financial interest, and which is sponsored or funded by any state agency, unless the employment, activity or enterprise is required as a condition of regular state employment. b. No officer or employee shall contract on his or her own behalf as an independent contractor with any state agency to provide goods or services.

Former State Employees (Pub. Contract Code § 10411):
a. For the two-year period from the date he or she left state employment, no former state officer or employee may enter into a contract in which he or she engaged in any of the negotiations, transactions, planning, arrangements or any part of the decision- making process relevant to the contract while employed in any capacity by any state agency.
b. For the twelve-month period from the date he or she left state employment, no former state officer or employee may enter into a contract with any state agency if he or she was employed by that state agency in a policy-making position in the same general subject area as the proposed contract within the 12-month period prior to his or her leaving state service.
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If Grantee violates any provisions of above paragraphs, such action by Grantee shall render this Agreement void. (Pub. Contract Code § 10420).

Members of boards and commissions are exempt from this section if they do not receive payment other than payment of each meeting of the board or commission, payment for preparatory time and payment for per diem. (Pub.

Contract Code § 10430 (e)).

9. LABOR CODE/WORKERS' COMPENSATION: Grantee needs to be aware of the provisions which require every employer to be insured against liability for Worker's Compensation or to undertake self-insurance in accordance with the provisions, and Grantee affirms to comply with such provisions before commencing the performance of the work of this Agreement. (Labor Code § 3700).

10. AMERICANS WITH DISABILITIES ACT: Grantee assures the State that it complies with the Americans with Disabilities Act (ADA) of 1990, which prohibits discrimination on the basis of disability, as well as all applicable regulations and guidelines issued pursuant to the ADA. (42 U.S.C. 12101 et. seq.)

11. RESOLUTION: For awards totaling $350,000 or more, a county, city, district, or other local public body must provide the State with a copy of a resolution, order, motion, or ordinance of the local governing body which by law has authority to enter into an agreement, authorizing execution of the agreement.

12. PAYEE DATA RECORD FORM STD. 204:This form must be completed by all Grantees that are not another state agency or other governmental entity.

13. DRUG FREE WORKPLACE:
a. Continue to provide a drug-free workplace by complying with the requirements in 2 C.F.R. part 3186 (Requirements for Drug-Free Workplace (Financial Assistance)). In particular, the recipient must comply with drug- free workplace requirements in subpart B of 2 C.F.R. part 3186, which adopts the Government-wide
implementation (2 C.F.R. part 182) of sections 5152-5158 of the Drug- Free Workplace Act of 1988 (P. L. 100-690, Title V, Subtitle D; 41 U.S.C. §§ 701-707).
b. This includes but is not limited to: making a good faith effort, on a continuing basis, to maintain a drug-free workplace; publishing a drug-free workplace statement; establishing a drug-free awareness program for the employees; taking actions concerning employees who are convicted of violating drug statutes in the workplace.

14. ACCESSIBILITY: The organization receiving this award, as listed in the certification section below, and all program staff, will ensure all project materials will meet California accessibility standards.

15. NON-DISCRIMINATION: The organization receiving this award, as listed in the certification section below, and all program staff, agree to comply with all California non-discrimination laws. 243
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16. ACKNOWLEDGEMENT: The organization receiving this award, as listed in the certification section below, and all program staff, agree to comply with California State Library acknowledgement requirements.

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Certification

ORGANIZATION
Name: Address (official and complete):

PROJECT COORDINATOR
Name:

Email: Phone:

GRANTTEE AUTHORIZED REPRESENTATIVE
Name: Title:

Email: Phone:

Signature: Date:

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Authorized Representative Signature

ORGANIZATION
Name: Address (official and complete):

AUTHORIZED REPRESENTATIVE
Signature: Date:

Printed Name of Person Signing: Title:

STATE OF CALIFORNIA
Agency Name: California State Library Address: 900 N Street, Sacramento, CA 95814 Signature: Date:

Printed Name of Person Signing: Title: California State Librarian

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April 25, 2022

RE: Contractor and Grantee Compliance with Economic Sanctions Imposed in

Dear Grantee,

You are receiving this notification because you currently have an active grant through the California State Library.

On March 4, 2022, Governor Gavin Newsom issued Executive Order N-6-22 (EO) regarding sanctions in response to Russian aggression in Ukraine. The EO is located at https://www.gov.ca.gov/wp-content/uploads/2022/03/3.4.22-Russia-Ukraine-Executive-Order.pdf.

certain immediate steps, including notifying all contractors and grantees of their obligations to comply with existing economic sanctions imposed by the U.S. government in response to Russia's actions in Ukraine, as well as any sanctions imposed under state law.

This correspondence serves as a notice under the EO that as a contractor or grantee, compliance including with respect to, but not limited to, the federal executive orders identified in the EO and the sanctions identified on the U.S. Department of the Treasury website (https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country- information/ukraine-russia-related-sanctions). Failure to comply may result in the termination of contracts or grants, as applicable.

Please note that for any agreements or grants valued at $5 million or more, a separate notification will be sent outlining additional requirements specified under the EO.

Annly Roman
California State Library
900 N Street
Sacramento, CA 95814

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248

LUNCH AT THE LIBRARY PROGRAM

FINANCIAL CLAIM

CERTIFICATION
I hereby certify under penalty of perjury: that I am the duly authorized representative of the claimant herein; that this claim is in all respects true, correct and in accordance with law and the terms of the agreement; and that payment has not previously been received for the amount claimed herein.

By
(Signature of the Authorized Representative)
(Print Name) (Title)
*Legal payee name must match Warrant will be made payable to payee name. Payee discrepancies in name and/or address may cause delay in payment. If you need to change payee name and/or address, please contact Fiscal Services at [email protected].

State of California, State Library Fiscal Office
ENY: 2025 ITEM NO: 6120-140-0001, Chapter 4, Statutes of 2025 PURCHASING AUTHORITY NUMBER: CSL-6120 REPORTING STRUCTURE: 61202000 COA: 5432000 PROGRAM #: 5312
FAIN: LS or N/A
By Date
(State Library Representative)
Grant Award #: LATL25-41A Date:

Invoice #: LATL25-41A-01 PO #: 8473
Payee Name: Murrieta Public Library
(Legal name of authorized agency to receive, disburse and account for funds*) Complete Address:

Street Address, City, State, Zip Code (Warrant will be mailed to this address) Amount Claimed: $12,362 Type of Payment:
(Payable Upon Execution of Agreement) PROGRESS
Grantee Name: Murrieta Public Library FINAL
(Name on Award Letter and Agreement) IN FULL
Project Title: Lunch at the Library Program AUGMENT
For Period From: upon execution to end of grant period
249
STATE OF CALIFORNIA – DEPARTMENT OF FINANCE

PAYEE DATA RECORD
(Required when receiving payment from the State of California in lieu of IRS W-9 or W-7) STD 204 (Rev. 03/2021)
Section 1 – Payee Information NAME (This is required. Do not leave this line blank. Must match the payee’s federal tax return) BUSINESS NAME, DBA NAME or DISREGARDED SINGLE MEMBER LLC NAME (If different from above) MAILING ADDRESS (number, street, apt. or suite no.) (See instructions on Page 2)

CITY, STATE, ZIP CODE E-MAIL ADDRESS
Section 2 – Entity Type Check one (1) box only that matches the entity type of the Payee listed in Section 1 above. (See instructions on page 2) CORPORATION (see instructions on page 2)SOLE PROPRIETOR / INDIVIDUAL MEDICAL (e.g., dentistry, chiropractic, etc.)SINGLE MEMBER LLC Disregarded Entity owned by an individual

PARTNERSHIP

ESTATE OR TRUST
LEGAL (e.g., attorney services)
EXEMPT (e.g., nonprofit) ALL OTHERS Section 3 – Tax Identification Number Enter your Tax Identification Number (TIN) in the appropriate box. The TIN must match the name given in Section 1 of this form. Do not provide more than one (1) TIN. The TIN is a 9-digit number. Note: Payment will not be processed without a TIN. For Individuals, enter SSN. If you are a Resident Alien, and you do not have and are not eligible to get an SSN, enter your ITIN. Grantor Trusts (such as a Revocable Living Trust while the grantors are alive) may not have a separate FEIN. Those trusts must enter the individual grantor’s SSN. For Sole Proprietor or Single Member LLC (disregarded entity), in which the sole member is an individual, enter SSN (ITIN if applicable) or FEIN (FTB prefers SSN). For Single Member LLC (disregarded entity), in which the sole member is a business entity, enter the owner entity’s FEIN. Do not use the disregarded entity’s FEIN. For all other entities including LLC that is taxed as a corporation or partnership, estates/trusts (with FEINs), enter the entity’s FEIN. Social Security Number (SSN) or Individual Tax Identification Number (ITIN) ___ ___ ___ -___ ___ - ___ ___ ___ ___ OR Federal Employer Identification Number(FEIN) ___ ___ - ___ ___ ___ ___ ___ ___ ___ Section 4 – Payee Residency Status (See instructions) CALIFORNIA RESIDENT – Qualified to do business in California or maintains a permanent place of business in California.

CALIFORNIA NONRESIDENT – Payments to nonresidents for services may be subject to state income tax withholding.

No services performed in California
Copy of Franchise Tax Board waiver of state withholding is attached.

Section 5 – Certification I hereby certify under penalty of perjury that the information provided on this document is true and correct. Should my residency status change, I will promptly notify the state agency below. NAME OF AUTHORIZED PAYEE REPRESENTATIVE TITLE E-MAIL ADDRESS SIGNATURE DATE TELEPHONE (include area code) Section 6 – Paying State Agency Please return completed form to: STATE AGENCY/DEPARTMENT OFFICE UNIT/SECTION MAILING ADDRESS FAX TELEPHONE (include area code) CITY STATE ZIP CODE E-MAIL ADDRESS Print Form Reset Form
250
STATE OF CALIFORNIA – DEPARTMENT OF FINANCE

PAYEE DATA RECORD
(Required when receiving payment from the State of California in lieu of IRS W-9 or W-7) STD 204 (Rev. 03/2021)

GENERAL INSTRUCTIONS
Type or print the information on the Payee Data Record, STD 204 form. Sign, date, and return to the state agency/department office address shown in Section 6.

Prompt return of this fully completed form will prevent delays when processing payments.

Information provided in this form will be used by California state agencies/departments to prepare Information Returns (Form1099).

NOTE: Completion of this form is optional for Government entities, i.e. federal, state, local, and special districts.

A completed Payee Data Record, STD 204 form, is required for all payees (non-governmental entities or individuals) entering into a transaction that may lead to a payment from the state. Each state agency requires a completed, signed, and dated STD 204 on file; therefore, it is possible for you to receive this form from multiple state agencies with which you do business.

Payees who do not wish to complete the STD 204 may elect not to do business with the state. If the payee does not complete the STD 204 and the required payee data is not otherwise provided, payment may be reduced for federal and state backup withholding. Amounts reported on Information Returns (Form 1099) are in accordance with the Internal Revenue Code (IRC) and the California Revenue and Taxation Code (R&TC).

Section 1 – Payee Information
Name – Enter the name that appears on the payee's federal tax return. The name provided shall be the tax liable party and is subject to IRS TIN matching (when applicable).

Sole Proprietor/Individual/Revocable Trusts – enter the name shown on your federal tax return.

Single Member Limited Liability Companies (LLCs) that is disregarded as an entity separate from its owner for federal tax purposes - enter the name of the individual or business entity that is tax liable for the business in section 1. Enter the DBA, LLC name, trade, or fictitious name under Business Name.

Note: for the State of California tax purposes, a Single Member LLC is not disregarded from its owner, even if they may be disregarded at the Federal level.

Partnerships, Estates/Trusts, or Corporations – enter the entity name as shown on the entity’s federal tax return. The name provided in Section 1 must match to the TIN provided in section 3. Enter any DBA, trade, or fictitious business names under Business Name.

Business Name – Enter the business name, DBA name, trade or fictitious name, or disregarded LLC name.

Mailing Address – The mailing address is the address where the payee will receive information returns. Use form STD 205, Payee Data Record Supplement to provide a remittance address if different from the mailing address for information returns, or make subsequent changes to the remittance address.

Section 2 – Entity Type
If the Payee in Section 1 is a(n)… THEN Select the Box for… Grantor (Revocable Living) Trust disregarded for federal tax purposes Sole Proprietor/Individual Limited Liability Company (LLC) owned by an individual and is disregarded for federal tax purposes Single Member LLC-owned by an individual Partnerships Limited Liability Partnerships (LLP) and, LLC treated as a Partnership Partnerships Estate Trust (other than disregarded Grantor Trust) Estate or Trust Corporation that is medical in nature (e.g., medical and healthcare services, physician care, nursery care, dentistry, etc. LLC that is to be taxed like a Corporation and is medical in nature Corporation-Medical
Corporation that is legal in nature (e.g., services of attorneys, arbitrators, notary publics involving legal or law related matters, etc.) LLC that is to be taxed like a Corporation and is legal in nature Corporation-Legal
Corporation that qualifies for an Exempt status, including 501(c) 3 and domestic non-profit corporations. Corporation-Exempt Corporation that does not meet the qualifications of any of the other corporation types listed above LLC that is to be taxed as a Corporation and does not meet any of the other corporation types listed above Corporation-All Other
Section 3 – Tax Identification Number The State of California requires that all parties entering into business transactions that may lead to payment(s) from the state provide their Taxpayer Identification Number (TIN). The TIN is required by R&TC sections 18646 and 18661 to facilitate tax compliance enforcement activities and preparation of Form 1099 and other information returns as required by the IRC section 6109(a) and R&TC section 18662 and its regulations. Section 4 – Payee Residency Status Are you a California resident or nonresident? A corporation will be defined as a "resident" if it has a permanent place of business in California or is qualified through the Secretary of State to do business in California.

A partnership is considered a resident partnership if it has a permanent place of business in California.

An estate is a resident if the decedent was a California resident at time of death.

A trust is a resident if at least one trustee is a California resident. o For individuals and sole proprietors, the term "resident" includes every individual who is in California for other than a temporary or transitory purpose and any individual domiciled in California who is absent for a temporary or transitory purpose. Generally, an individual who comes to California for a purpose that will extend over a long or indefinite period will be considered a resident. However, an individual who comes to perform a particular contract of short duration will be considered a nonresident.

For information on Nonresident Withholding, contact the Franchise Tax Board at the numbers listed below:

Withholding Services and Compliance Section: 1-888-792-4900 E-mail address: [email protected] For hearing impaired with TDD, call: 1-800-822-6268 Website: www.ftb.ca.gov Section 5 – Certification
Provide the name, title, email address, signature, and telephone number of individual completing this form and date completed. In the event that a SSN or ITIN is provided, the individual identified as the tax liable party must certify the form. Note: the signee may differ from the tax liable party in this situation if the signee can provide a power of attorney documented for the individual.

Section 6 – Paying State Agency
This section must be completed by the state agency/department requesting the STD 204.

Privacy Statement
Section 7(b) of the Privacy Act of 1974 (Public Law 93-579) requires that any federal, state, or local governmental agency, which requests an individual to disclose their social security account number, shall inform that individual whether that disclosure is mandatory or voluntary, by which statutory or other authority such number is solicited, and what uses will be made of it. It is mandatory to furnish the information requested. Federal law requires that payment for which the requested information is not provided is subject to federal backup withholding and state law imposes noncompliance penalties of up to $20,000. You have the right to access records containing your personal information, such as your SSN. To exercise that right, please contact the business services unit or the accounts payable unit of the state agency(ies) with which you transact that business.

All questions should be referred to the requesting state agency listed on the bottom front of this form. 251

CITY OF MURRIETA
City Council Meeting Agenda
Report
3/17/2026
Agenda Item No. 10.

TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: David Chantarangsu, AICP, Development Services Director PREPARED BY: Carl Stiehl, City Planner
SUBJECT:

Approval to Participate in the Vehicle Miles Traveled Mitigation Exchange Program and Authorization to Enter into a Credit Generator Participation Agreement with the Western Riverside Council of Governments

ABSTRACT
The Western Riverside Council of Governments (WRCOG) has established a voluntary Vehicle Miles Traveled (VMT) Mitigation Exchange Program to assist the City and projects both inside and outside the City with VMT traffic-related impact mitigation regionally. Participation in the program is voluntary and at the City’sdiscretion on a case-by-case basis. Joining the program does not obligate the City to any specific projects or mitigation measures until the City chooses to use the program for a project.

RECOMMENDATION
Approve the City’sparticipation in the voluntary Western Riverside Council of Governments (WRCOG) Vehicle Miles Traveled (VMT) Mitigation Exchange Program;
Authorize the City Manager or designee to enter into a Credit Generator Participation Agreement with the WRCOG; and
Direct staff to coordinate with WRCOG to add VMT-reducing improvement projects at the City’sdiscretion into the voluntary program to address development projects with transportation related VMT impacts.

PRIOR ACTION/VOTE
None.

CITY COUNCIL GOAL
Plan, program and create infrastructure development.

DISCUSSION
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Agenda Item No. 10.

Background
In 2013, Senate Bill (SB) 743 was signed into law, which requires local agencies implementing the California Environmental Quality Act (CEQA) Guidelines to establish a new metric for determining the significance of transportation impacts.

In 2018, the CEQA guidelines were updated, requiring all local agencies to adopt VMT as the new measure to evaluate transportation impacts under CEQA, with an effective implementation date of July 1, 2020.

The City’sFocused General Plan Update, approved in July 2020, adopted VMT as the new transportation metric and established modified Traffic Impact Analysis (TIA) Guidelines in compliance with the State mandate. The initial VMT adoption established VMT thresholds and screening criteria. The TIA guidelines were consistent with the regional recommendations established by WRCOG. As a result of converting traffic analysis criteria to VMT in recent years, many jurisdictions began considering options for projects to mitigate potential VMT impacts.

VMT Mitigation Program
A VMT Mitigation Program can provide a potential solution for projects to mitigate their transportation impacts under CEQA and would also provide projects with an opportunity to avoid processing more costly environmental documents, streamline the development process, provide certainty to developers, and maybe be used as a mitigation resource by other agencies. A VMT Mitigation Program can also serve as a potential funding source for cities or transit agencies for non-vehicular improvements, such as active transportation and transit projects. The City is not mandated to have a Mitigation Program at this time, however it can choose to set up it’sown Mitigation Program, which would take significant time and cost to put together, and the City may also choose to participate in other potential VMT programs that may be available on the local or regional level.

Staff at WRCOG received direction from the Executive Committee to evaluate options for mitigating VMT impacts from new development. WRCOG commenced an effort to develop a potential program in partnership with its member agencies (including the City of Murrieta) and key regional stakeholders. In January 2024, the Deputy Executive Director of WRCOG presented to the Board information on VMT and the possible mitigation program. After numerous meetings led by WRCOG, the voluntary VMT Mitigation Program (Program) was developed. The Riverside Transit Agency (RTA), Riverside County Transportation Commission (RCTC), and WRCOG worked together to develop a program manual that will be used to implement the VMT Exchange Mitigation Program. The Program Manual is included in Attachment 2, and a Program Fact Sheet and FAQ are included in Attachment 3.

Program Logistics
WRCOG will serve as the Program Administrator and central point of coordination for program participants, including regional agencies, member jurisdictions (such as the City), and other stakeholders, as appropriate.

Through the voluntary Program, participants who need to offset significant VMT impacts will be able to purchase VMT credits generated by participants with VMT credit-generating projects, such as a project in the City of Murrieta. As a result, credit-using projects will not be delayed due to an inability to offset VMT impacts, and credit-generating projects may be expedited due to access to funding. A general flow chart for the WRCOG VMT Exchange Program is included in the program manual (Attachment 2). The City retains the authority to determine which projects, if any, in the City may qualify as a potential project.

On May 5, 2025, the Program was approved by WRCOG’sExecutive Committee. Staff is requesting approval for the City to participate in the Program as a “credit generator.” As a credit generator, the City can submit credit-generating projects to the Program for potential funding. Generally, “credit-generating projects” are projects that would assist with reduction of vehicular trips (vehicle miles traveled). Projects examples include but are not limited to:

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Agenda Item No. 10.
· Pedestrian network improvements, such as sidewalks and trails; · Bike facility construction or improvement, such as bike lanes; · Transit-supportive roadway treatments;
· Transit access, safety, and comfort improvements;
· Property acquisition for conservation purposes; and
· Gap financing for affordable infill housing development.

Through the Program, the City may obtain additional funding for operational and capital credit-generating projects. If approved, credit-generating projects may be submitted to WRCOG for inclusion in the Program at the City’sdiscretion. Participating in the program and implementing credit-generating projects will advance development and benefit the community. WRCOG, as the Program Administrator, will charge an administration fee of four (4) percent to administer the regional program. WRCOG is responsible for preparing an annual report detailing the Program's status and considering any amendments. Some agencies have already executed agreements to participate in the Program, including the Riverside Transit Agency (RTA) and the City of Riverside.

Program Rollout
WRCOG hosted two (2) comprehensive community webinars for all regional agencies, CEQA practitioners, and developers. The two (2) webinars, held on September 18, 2025, and September 24, 2025, provided an opportunity to learn more about the Program’sbenefits, eligibility, administration, and monitoring. The primary benefit to the City for participation in the regional Program is ease of administration and less impact on staff capacity. If the City participates in the regional program, WRCOG will handle the complex tracking and reporting, which provides economies of scale and simplifies the process for individual agencies. Additionally, participation in a regional program also opens the possibility to regionally-oriented credit-generating projects; VMT reduction is most effective when addressed regionally.

During the land development entitlement process, the developer must evaluate its proposed project for transportation impacts (VMT assessment). If the proposed development has a VMT impact, then the project must mitigate its transportation impacts. Participating in the WRCOG VMT Mitigation Exchange Program is a new option for development projects to utilize in the City.

A developer may choose any available VMT mitigation option (or any combination thereof) when working with the City to analyze a project. The establishment of the regional WRCOG VMT Mitigation Exchange Program functions as a viable option for many potential future projects. The City is pleased to help facilitate the WRCOG Mitigation Exchange Program as an additional means to accelerate the development planning process and provide certainty to incoming developers that viable, cost-effective mitigation is available in Murrieta. As more cities join the voluntary program, more options for regional VMT mitigation will become available for projects. Joining the Program does not preclude the City from other forms of VMT mitigation. The City still retains the ability to create it’s own local Mitigation Program in the future.

FISCAL IMPACT
There is no fiscal impact to the City associated with the voluntary WRCOG VMT Mitigation Exchange Program.

ATTACHMENTS
ATT 1 - Voluntary VMT Exchange Program Participation Agreement ATT 2 - Regional VMT Mitigation Program Implementation Manual CITY OF MURRIETA Printed on 3/12/2026Page 3 of 4
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3/17/2026
Agenda Item No. 10.

ATT 3 - VMT Program Fact Sheet and FAQ
CITY OF MURRIETA Printed on 3/12/2026Page 4 of 4
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VOLUNTARY VMT EXCHANGE PROGRAM

PARTICIPATION AGREEMENT

This Participation Agreement (“Agreement”) is made as of ______________ (“Effective Date”), by and between the Western Riverside Council of Governments, a California public agency (“WRCOG”) and the City of Murrieta, a municipal corporation (“Participant”). WRCOG and Participant are sometimes individually referred to as “Party” and collectively as “Parties”.

RECITALS

A. Before a California public agency issues a discretionary approval that authorizes an action with potential environmental impacts, the agency must first comply with the California Environmental Quality Act (“CEQA”) and disclose potential impacts to the environment.

B. The CEQA process may involve the imposition of “mitigation measures” which help to reduce a project’s potentially significant impacts.

C. The manner in which transportation effects are analyzed under CEQA changed dramatically when Senate Bill 743 (“SB 743”) was adopted in 2013. SB 743 and its implementing regulations require that transportation impacts throughout the state no longer be measured in terms of vehicle delay, but instead in terms of how many Vehicle Miles Traveled (“VMT”) a project generates.

D. Transportation demand management strategies have traditionally been utilized to change travel behavior as a way of reducing VMT. These strategies are generally most effective in urban areas where a project site is accessible through multiple travel modes offering similar travel times and convenience.

E. However, these strategies are less effective in low-density suburban and rural areas, such as Western Riverside County. As a result, Western Riverside County needs a coordinated regional approach.

F. To address these needs, WRCOG has established a Voluntary VMT Exchange Program (the “Program”) that allows Credit Users to agree to fund a predetermined VMT- reducing project submitted by a Credit Generator.

G. Participant desires to participate in the Program as a Credit Generator.

H. The purpose of this Agreement is to outline the terms and conditions of the Participant’s voluntary participation in the Program.

NOW, THEREFORE, IT IS AGREED AS FOLLOWS:

AGREEMENT

1. Incorporation of Recitals. The recitals above are true and correct and are hereby incorporated herein by this reference.
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2. Definitions.
(a) “Credit” shall mean a VMT reduction credit.
(b) “Credit Generator” shall mean an entity that implements some action which produces a Credit. For the purposes of this Agreement, Participant is a Credit Generator. (c) “Credit Generating Item” shall mean a specific project or action which may produce a Credit.
(d) “Credit User” shall mean a land development or transportation project administrator that needs a Credit for the purpose of CEQA mitigation. (e) “Program Manual” shall mean the Western Riverside Council of Governments Voluntary VMT Exchange Program Implementation Manual as may be amended from time to time.

3. Term and Termination
(a) Term. The term of this Agreement shall commence on the Effective Date and shall remain in effect until terminated in accordance with Section 3(b) of this Agreement. (b) Termination.
(i) Termination for Convenience. Either Party may terminate this Agreement upon three (3) months written notice, except that this Agreement shall remain in effect as to any Credit-Generating Item for which Credit Purchase Agreement has been executed but not completed. However, in the event that there are any Credit-Generating Items submitted by Participant that remain which are subject to a Credit Purchase Agreement, Participant may only terminate this Agreement upon the completion of such Credit-Generating Items. (ii) Termination for Breach. WRCOG reserves the right to terminate this Agreement in the event of Participant’s violation of this Agreement and non-compliance with the Program Manual. Upon receipt of written notice from WRCOG regarding the violation, Participant shall have thirty (30) days to correct the violation. Failure to cure the violation within the thirty (30) day period shall result in the termination of this Agreement.

4. Participant Responsibilities.
(a) Submission of Credit-Generating Items. Upon execution of this Agreement, Participant can then submit Credit-Generating Items for use in the Program by utilizing a Credit-Generating Item Form as further described in the Program Manual. Credit- Generating Items are subject to approval by WRCOG as the Program Administrator pursuant to the process as outlined in the Program Manual.
(i) Qualification and Accuracy of Information. Participant agrees that any Credit-Generating Items that are submitted to the Program shall provide the necessary information as provided in the Program Manual Section III.D.4. In addition, Participant is solely 257
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responsible for providing accurate information regarding their Credit-Generating Items submitted. Inaccurate information may result in removal of the Credit-Generating Item from the Program.
(ii) Credit User Agreement. Upon the selection of a Credit-Generating Item submitted by Participant by a Credit User, the WRCOG shall enter into a Credit Purchase Agreement with the Credit User. The Credit Purchase Agreement shall substantially be in the form as presented in the Program Manual.
(iii) Avoidance of Duplicate Mitigation. Participant agrees that any Credit-Generating Items submitted to WRCOG shall not be used to satisfy multiple instances of mitigation. This includes, but is not limited to, placing Credit-Generating-Items on multiple exchanges at once.
(iv) Disputes. In the event of any disputes regarding a Credit- Generating Item occurring under this Agreement, Participant agrees to follow the dispute procedures as outlined in Program Manual.
(v) Removal of Credit-Generating Items. Participant understands and agrees that Credit-Generating Items placed into the Program shall remain in the Program unless otherwise approved in writing by WRCOG.
(vi) Credit Generating Item Completion. To the extent practicable, Participant shall ensure that the Credit-Generating Item is carried out or completed once it has been assigned to a Credit User and Participant has received payment for the Credits. Participant shall take all steps reasonably necessary to ensure that the Credit-Generating Item is carried out or completed. Upon completion of the Credit-Generating Item, Participant shall provide WRCOG with a completion form.
(b) Laws and Regulations. Participant shall keep itself fully informed of and in compliance with all local, state and federal laws, rules and regulations in any manner affecting the performance of its obligations under this Agreement. In addition, Participant shall comply with the Program Manual, as may be amended from time to time.

5. WRCOG Responsibilities.
(a) Program Administration. WRCOG agrees to administer the Program in accordance with the Program Manual, as may be amended from time to time. (b) Allocation of Funds. WRCOG shall collect and allocate funds from Credit Users when Participant’s Credit Generating Item is selected. (c) Credit Transfer. Following the execution of the Credit Purchase Agreement by WRCOG and the Credit User, WRCOG will transfer the credits from the program to the Credit User for their use.
(d) Technical Assistance. WRCOG agrees to provide technical assistance to quantify the potential amount of credits a Credit Generating Item produces, ensure compliance 258
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with Program Manual, and take appropriate measures to address any discrepancies or concerns with the submission of Credit Generating Items.
(e) Transparency. WRCOG agrees to maintain transparency in all Program- related matters, including calculation methodologies, maintenance of the exchange list, and distribution of credit-generating items, ensuring fair and equitable treatment of all participants.

6. Indemnity.
(a) To the fullest extent permitted by law, Participant shall defend, at Participant's sole cost and expense, indemnify, protect, and hold harmless WRCOG, its officers, directors, employees, and agents (collectively the "WRCOG Indemnified Parties"), from and against any and all liabilities, actions, suits, claims, demands, losses, costs, judgments, arbitration awards, settlements, damages, demands, orders, penalties, and expenses including legal costs and attorney fees (collectively "Claims"), including but not limited to Claims arising from injuries to or death of persons (Participant's employees included), for damage to property, including property owned by WRCOG, or from any violation of any federal, state, or local law or ordinance, alleged to be caused by the negligent acts, omissions or willful misconduct of Participant, its officers, directors, employees or agents in connection with or arising out of the construction and/or operation of any Credit-Generating Items submitted to the Program by Participant as well as performance of Participant’s obligations under this Agreement. (b) To the fullest extent permitted by law, WRCOG shall defend, at WRCOG’s sole cost and expense, indemnify, protect, and hold harmless Participant, its officers, directors, employees, and agents (collectively the "Participant Indemnified Parties"), from and against any and all liabilities, actions, suits, claims, demands, losses, costs, judgments, arbitration awards, settlements, damages, demands, orders, penalties, and expenses including legal costs and attorney fees (collectively "Claims"), including but not limited to Claims arising from injuries to or death of persons (WRCOG’s employees included), for damage to property, including property owned by Participant, or from any violation of any federal, state, or local law or ordinance, alleged to be caused by the negligent acts, omissions or willful misconduct of WRCOG, its officers, directors, employees or agents in connection with or arising out of the administration of the Program and the performance of its obligations under this Agreement. The indemnity obligations outlined in this Section 6(b) shall include any actions brought under the California Environmental Quality Act, the National Environmental Policy Act or other related action to the extent that such actions do not arise out of Participant’s breach of this Agreement and/or noncompliance with the Program Manual.
(c) The indemnification and defense obligations of this Agreement shall survive its expiration or termination.

7. Insurance. During the term of this Agreement and for one (1) year thereafter, Participant shall maintain Commercial General Liability insurance. The Commercial General Liability insurance policy limits shall be not less than One Million Dollars ($1,000,000) combined single limit per occurrence for bodily injury, death and property damage liability, and Two Million Dollars ($2,000,000) in aggregate. Such insurance shall cover Participant’s obligations under this Agreement and the actions of its employees, agents and subcontractors. 259
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All policies shall be written by reputable insurance companies with a Best's policyholder rating of not less than A- VII.

Upon execution of this Agreement, Participant shall provide a Certificate of Insurance evidencing the insurance required herein. In no event shall the limits of any policy be considered as limiting the liability of Participant under this Agreement. Notwithstanding the foregoing, Participant may satisfy these requirements through a self-insurance program or participation in a public entity risk-sharing pool, subject to applicable law.”

8. Miscellaneous Terms.
(a) Third Party Rights. Nothing in this Agreement shall be construed to give any rights or benefits to anyone other than the Participant and WRCOG. (b) Notice. Any notice or instrument required to be given or delivered by this Agreement may be given or delivered by depositing the same in any United States Post Office, certified mail, return receipt requested, postage prepaid, addressed to the following addresses and shall be effective upon receipt thereof:

WRCOG:

Western Riverside Council of Governments
1955 Chicago Avenue, Suite 200
Riverside, CA 92507
Attn: Executive Director

PARTICIPANT:

City of Murrieta
1 Town Square
Murrieta, CA 92562
Attn: City Manager
(c) Entire Agreement. This Agreement represents the entire understanding of WRCOG and Participant as to those matters contained herein, and supersedes and cancels any prior or contemporaneous oral or written understanding, promises or representations with respect to those matters covered hereunder. Each Party acknowledges that no representations, inducements, promises, or agreements have been made by any person which are not incorporated herein, and that any other agreements shall be void. This is an integrated Agreement. (d) Severability. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal, or unenforceable for any reason, such determination shall not affect the validity or enforceability of the remaining terms and provisions hereof or of the offending provision in any other circumstance, and the remaining provisions of this Agreement shall remain in full force and effect.
(e) Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors in interest, executors, administrators and assigns of each Party to this Agreement. However, Participant shall not assign or transfer by operation of law or otherwise any or all of its rights, burdens, duties or obligations without the prior written consent of WRCOG. Any attempted assignment without such consent shall be invalid and void. 260
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(f) Non-Waiver. The delay or failure of either Party at any time to require performance or compliance by the other Party of any of its obligations or agreements shall in no way be deemed a waiver of those rights to require such performance or compliance. No waiver of any provision of this Agreement shall be effective unless in writing and signed by a duly authorized representative of the Party against whom enforcement of a waiver is sought. The waiver of any right or remedy with respect to any occurrence or event shall not be deemed a waiver of any right or remedy with respect to any other occurrence or event, nor shall any waiver constitute a continuing waiver.
(g) Time of Essence. Time is of the essence for each and every provision of this Agreement.
(h) Governing Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of California. Venue shall be in the County of Riverside.
(i) Headings. Paragraphs and subparagraph headings contained in this Agreement are included solely for convenience and are not intended to modify, explain, or to be a full or accurate description of the content thereof and shall not in any way affect the meaning or interpretation of this Agreement.
(j) Amendments. Only a writing executed by all of the Parties hereto or their respective successors and assigns may amend this Agreement. (k) Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original. All counterparts shall be construed together and shall constitute one single Agreement.
(l) Authority. The persons executing this Agreement on behalf of the Parties hereto warrant that they are duly authorized to execute this Agreement on behalf of said Parties and that by doing so, the Parties hereto are formally bound to the provisions of this Agreement. (m) Electronic Signature. Each Party acknowledges and agrees that this Agreement may be executed by electronic or digital signature, which shall be considered as an original signature for all purposes and shall have the same force and effect as an original signature.
[SIGNATURES ON FOLLOWING PAGE]

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SIGNATURE PAGE FOR VOLUNTARY VMT EXCHANGE PROGRAM

PARTICIPATION AGREEMENT

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.

WRCOG

WESTERN RIVERSIDE COUNCIL OF

GOVERNMENTS
APPROVED BY:

APPROVED AS TO FORM:

Best Best & Krieger LLP
General Counsel

PARTICIPANT

CITY OF MURRIETA

APPROVED BY:

APPROVED AS TO FORM:

____________________________________

General Counsel

262
Regional VMT
Mitigation Program
Implementation
Manual
Western Riverside Council of Governments
Adopted by the WRCOG Executive Committee May 5,2025
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TABLE OF CONTENTS
I. INTRODUCTION ............................................................................................. 1 II. BACKGROUND AND PURPOSE ........................................................................ 2 A. Senate Bill 743 and Vehicle Miles Traveled ................................ ..................... 2 B. Need for a Regional VMT Mitigation Program ................................ .................. 3 C. Different Types of Regional VMT Mitigation Programs ................................ ...... 4 D. Definitions ................................ ................................ ................................ ... 5 III. THE VOLUNTARY VMT EXCHANGE PROGRAM .................................................. 6 A. General Description and How it Works ................................ .......................... 6 B. Potential Types of VMT Mitigation Projects (Credit-Generating Items) .............. 6 C. Governance ................................ ................................ ............................... 10 D. Administration ................................ ................................ ........................... 11 E. Exchange Menu ................................ ................................ .......................... 24 F. Participants ................................ ................................ ............................... 25 IV. QUALIFICATION CRITERIA FOR CREDIT-GENERATING ITEMS .......................... 26 V. QUANTIFICATION OF CREDIT-GENERATING ITEMS......................................... 26 A. General Principles for Credit Quantification ................................ ................. 26 B. Standardized Calculation Methods ................................ ............................. 27 VI. APPENDICES ............................................................................................... 28 264

WESTERN RIVERSIDE COUNCIL OF GOVERNMENTS

VOLUNTARY VMT MITIGATION EXCHANGE

PROGRAM MANUAL

1 I. INTRODUCTION
The Western Riverside Council of Governments (WRCOG), in partnership with its member agencies and key regional stakeholders, has developed a voluntary exchange program (Program) to provide a method to mitigate vehicle miles traveled (VMT) impacts under the California Environmental Quality Act (CEQA). WRCOG will serve as the Program Administrator and main point of coordination for Program Participants, which could include regional agencies, WRCOG member agencies, and other stakeholders, as appropriate.

The requirement to analyze and mitigate VMT impacts as part of a CEQA document is an emerging field. While there is substantial empirical data regarding the effectiveness of various VMT mitigation measures, there is less certainty regarding how VMT mitigation programs might be utilized, particularly by parties needing to find ways to offset their VMT impacts.

Through the Program, Program Participants in need of a way to offset significant VMT impacts will be able to purchase VMT credits generated by participants with VMT credit-generating projects. As a result, credit-using projects will not be delayed due to an inability to offset VMT impacts, and credit-generating projects may be expedited due to access to funding. The Program is voluntary and applicants who are unable to secure credits or unwilling to comply with the various requirements can pursue other opportunities for VMT mitigation through alternative means.

This Program Manual establishes rules and procedures intended to cover most anticipated situations and provides some level of flexibility to adjust to changing circumstances. If there is a case in which the Program Manual does not fully anticipate a circumstance or discretion is required, WRCOG commits that it will exercise its discretion in an impartial, transparent, and collaborative fashion. WRCOG is well suited to serve as an impartial administrator, able to act in the best interests of the overall program rather than themselves, because WRCOG does not generate or use credits.
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2 WRCOG reserves the right to take action in the best interest of the Program to best serve all participants. These actions could include, but are not limited to, the following:
▪ Limiting the number of credits available to one applicant. ▪ Choosing not to provide credits to an applicant if such a restriction is determined to be in the best interest of the program.
▪ Deferring the provision of credits until a later date for various reasons. ▪ Withholding credits from applicants who are unwilling to sign the appropriate agreements.

Applicants who are requesting credits from the Program have the right to appeal any decision made by the Program Administrator and will be allowed to utilize the formal appeal process, provided they have standing to appeal, as described in Section III.D.9.c.i.

This Program Manual is intended to be a living document. As State regulatory guidance changes and the program evolves, WRCOG will regularly update the Program Manual to reflect these changing conditions. Any updates will be prepared and implemented in conjunction with our regional partners, WRCOG member agencies, and other stakeholders, as appropriate.

II. BACKGROUND AND PURPOSE
A. Senate Bill 743 and Vehicle Miles Traveled
Before a California public agency issues a discretionary approval that authorizes an action with potential environmental impacts, the agency must first comply with CEQA and disclose potential impacts to the environment. For example, before a city or a county approves a site-development project, and before a transportation agency approves the construction of new infrastructure, those agencies must ensure that CEQA compliance has been completed.

Unless an action is exempt from substantive environmental review, an agency is most often faced with the choice of preparing either a CEQA Negative Declaration or, Mitigated Negative Declaration (MND), or an Environmental Impact Report (EIR). Either an MND or EIR may involve the imposition of “mitigation measures” which help to address or reduce a project’s potentially significant impacts.

The manner in which transportation effects are analyzed under CEQA changed dramatically when Senate Bill 743 (SB 743) was adopted in 2013 and codified in Public Resources Code section 21099. This law and its implementing regulations require that 266

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transportation impacts throughout the state no longer be measured in terms of vehicle delay, but instead in terms of how many VMT a project generates. The purposes of SB 743 are to place greater focus on implementing the State’s goals of reducing greenhouse gas (GHG) emissions, promoting transit, and increasing infill development.

For many agencies, the threshold of how much VMT triggers the requirement for an EIR varies. But, in some instances, that threshold may be reached even for projects that align with the State’s goals of reducing GHG emissions, promoting transit, increasing infill development, and building more housing. When significant impacts are identified, CEQA requires that feasible mitigation measures be proposed. If all feasible mitigation is exhausted and there is still a significant impact, a statement of overriding considerations must be issued which would trigger an EIR. This adds further cost and time to project implementation.

SB 743 has a disproportionately heavy impact on less-developed counties (like Riverside County) because those areas have not yet fully built-out their roadway networks, have less robust non-automotive travel options (like transit), and lack institutional support facilities. Thus, developments in Riverside County are far more likely to constitute “new” development, rather than “infill” projects, and are far more likely to generate VMT effects that require a full EIR, rather than a streamlined Negative Declaration/Mitigated Negative Declaration (or potential exemption). Thus, there is a demand for a dependable means of reliably mitigating or offsetting VMT impacts that would arise from development and transportation projects.

B. Need for a Regional VMT Mitigation Program
Transportation demand management strategies have traditionally been utilized to change travel behavior as a way of reducing VMT. These strategies are generally most effective in urban areas where a project site is accessible through multiple travel modes (i.e., walking, bicycling, transit, and personal micro-mobility vehicles), offering similar travel times and convenience. These strategies are less effective in low-density suburban and rural areas where travel modes are more reliant upon personal automobiles. Much of Western Riverside County falls into this latter category and needs a coordinated regional approach.
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4 C. Different Types of Regional VMT Mitigation Programs In more suburban and rural areas, a program-based approach to VMT mitigation is typically more effective than applying strategies to a project site only. Following is a review of three common program-based approaches that may be established to enable mitigation options for projects required to implement VMT mitigation:
▪ VMT Impact Fee Program – is a traditional impact fee program in compliance with the Mitigation Fee Act. The nexus for the fee program is a VMT reduction goal consistent with the CEQA threshold established by a lead agency for SB 743 purposes. The main difference from a fee program based on a metric such as vehicle level of service (LOS) is that the VMT reduction nexus results in a capital improvement program consisting largely of transit, bicycle, and pedestrian projects.

These types of fee programs are time-consuming to develop, monitor, and maintain but are recognized as an acceptable form of CEQA mitigation. ▪ VMT Mitigation Exchange – relies on a Credit User agreeing to fund, implement, or acquire a predetermined VMT reducing project or propose a new one. The project may be located in the vicinity of the project needing VMT mitigation or elsewhere in the community, and possibly outside the community. The VMT Mitigation Exchange needs to have a facilitating entity that can match the VMT producer (the development/ infrastructure project) with a VMT reducing project or action. The facilitating entity could be the lead agency or another entity that can provide the match and document the VMT reduction with substantial evidence. This option provides the most flexibility for mitigation project selection and is also the least complex to set up. Implementation is completed on a project-by-project basis, similar to typical mitigation measures.
▪ VMT Mitigation Bank – attempts to create a monetary value for VMT reduction such that a Credit User could purchase VMT reduction credits. The money exchanged for credits could be applied to local, regional, or state-level VMT reduction projects or programs. Like all VMT mitigation, substantial evidence is necessary to demonstrate that the projects covered by the VMT Mitigation Bank would achieve expected VMT reductions and some form of monitoring may be required. This is more complicated than a simple exchange and requires more time and effort to set up and implement. However, the VMT Mitigation Bank can include other VMT reducing efforts (like rideshare or telecommute programs) that cannot be implemented in a VMT Impact Fee Program and would be more difficult to implement in a VMT Mitigation Exchange program. The verification of how much VMT reduction is associated with each dollar or credit and tracking mitigation completion are more difficult parts of the VMT Mitigation Bank. Perhaps the most 268

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restrictive component of a VMT Mitigation Bank is that VMT reduction credits need to be generated prior to their ability to be purchased; which necessitates some level of seed funding to implement projects or programs to begin generating the VMT credits prior to them being sold.

The option that best fits the needs of Western Riverside County currently is an exchange program given some of the constraints noted above. WRCOG will serve as the facilitating entity (VMT Program Administrator) and will be responsible for administering the program.

D. Definitions
▪ Applicant: A developer or similar entity applying to purchase credit(s) as a credit user.
▪ Credit: VMT reduction credit.
▪ Credit Generator: A public agency that implements a project or program that produces a VMT reduction credit. Credit generators will enter into a Participation Agreement with the Program Administrator. This agreement enables public agencies to submit credit-generating items to the Program that are eligible to receive funding through the Program.
▪ Credit-generating Item: A specific project or program that has produced or may produce a credit.
▪ Credit User: Land development or transportation project administrator that needs VMT reduction credits for CEQA mitigation.
▪ Implementing Agency: A public agency responsible for implementing a public sector project for those cases in which another agency is designated as a lead agency for purposes of CEQA.
▪ Lead Agency: The public agency that has primary responsibility for carrying out or approving a project that is subject to CEQA.
▪ Program Administrator: The entity responsible for managing the Program and facilitating VMT mitigation exchange. WRCOG serves as the Program Administrator. ▪ VMT Impact: The generation of VMT above the applicable threshold of significance by a project, which may require a Credit User to seek a mitigating credit(s). 269

6 III. THE VOLUNTARY VMT EXCHANGE PROGRAM
A. General Description and How it Works
Following is a brief description of the major steps to facilitating a VMT mitigation exchange:

1. The Program Administrator requests credit-generating items from Credit Generators to be included on a list of potential credit-generating items that have produced or may produce a credit(s) and the Program Administrator maintains the list of items.

2. Credit Generators submit credit-generating items on a processing form that details the project/program cost and description and certifies the project/program is ready for implementation, as defined by the qualification criteria in this Program Manual (see Section IV). For the purposes of the Program, active steps taken to implement the project/program being submitted as a credit-generating item is implementation.

Additional clarification is provided in the Participation Agreement (Appendix A).

3. Credit Users generate a significant VMT impact and need to purchase credits to mitigate those impacts. The cost of credits is project/program specific.

4. Credit Users submit a form indicating that the Credit User generates a significant VMT impact and is applying to purchase credits to mitigate impacts. If the Credit User is not a public agency, the application must be reviewed by the CEQA lead agency to verify application details before credits are issued.

Note: Mitigation measures must equal or exceed the amount of the VMT impact to fully mitigate the project impact under CEQA.

5. Funds are collected by the Program Administrator and allocated to the specific Credit Generator whose credit-generating item was selected by the Credit User.

A description of the overall process is provided as Exhibit 1.

B. Potential Types of VMT Mitigation Projects (Credit-Generating Items) The following potential credit-generating items do not represent an exhaustive list of potential VMT-reducing projects or programs. Currently, the California Air Pollution Control Officers Association (CAPCOA) Handbook for Analyzing Greenhouse Gas Emission Reductions, Assessing Climate Vulnerabilities, and Advancing Health and Equity (CAPCOA, December 2024) is the best source for the latest data and research for quantification of credit-generating items. As new data, studies, and information become available, additional projects/programs may be incorporated as credit- generating items, beyond what is currently identified by CAPCOA.

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Program Administrator requests list of
credit-generating items from Credit
Generators
Credit Generators submit eligible
items
Program Administrator confirms
eligibility and quantifies VMT reduction
for each submitted item
Credit User generates a VMT impact
and determines need to mitigate that
impacts
Credit Users apply to purchase credits
to mitigate impacts
Application is reviewed and if approved by
Program Administrator, Credit User pays for
specific credit-generating item
Program Administrator allocates funds back to
Credit Generator who submitted the specific
credit-generating item
If Program Administrator/Credit Generator
have questions, issues are resolved before
credit generating item is eligible for
inclusion in Program
If application is not approved, Credit User
may update application or determine
appropriate next steps in consultation with
Program Administrator
WRCOG Voluntary VMT Mitigation Exchange Program
Overall Program Process
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8 Any credit-generating item that is incorporated into the Program must provide sufficient information that would allow the Program Administrator’s technical experts to quantify the credits that would be available during the Program. The Program Administrator has the flexibility to revisit the projects or programs included in the Program on an annual basis to ensure the projects or programs are achieving the intended mitigation amount as costs, information, and other variables change.

As noted above, the Program Administrator will be responsible for working with its technical experts to calculate VMT credits using information supplied by the Credit Generator. Credit users, such as CEQA lead agencies, may then choose which credit generating project(s) best align with their mitigation needs. As such, the Credit Users would have the opportunity to rely upon and accept the VMT-reduction analysis completed by the Program Administrator’s technical expert. WRCOG will also provide the VMT reduction calculations to the Credit User at their request.

Potential Credit-Generating Items include but are not limited to the following:

1. Operations/Maintenance Projects
− Transit Network Coverage or Hours Extension: Adding or modifying transit operations to include more hours of existing routes/lines or fund the operations of a new transit route/line.
− Transit Service Frequency Increase: Modifying and funding transit operations to include more frequent service on an existing transit line.

2. Ongoing Programs
− Transit Passes: Providing discounted or free transit fare to a specific geographic area, population group, or the general public. − Vanpool Program: Providing financial support for a vehicle to groups of 5 to 15 people for the purpose of carpooling between their workplaces and residences.
− Rideshare Program: Providing access to and encouraging the use of a ridesharing alternative, platform, or service. This could be an app, website, or other service that provides ride-matching coordination services. 272

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3. Capital Improvements
− Pedestrian Network Improvement: Constructing new sidewalks and/or improving damaged or substandard sidewalks that connect to a larger pedestrian network.
− Bike Facility Construction or Improvement: Constructing new or enhancing an existing Class I, II, or IV bike facility.
− Transit-Supportive Roadway Treatments: Funding infrastructure improvements, such as traffic signal modifications and roadway signage and striping, that are dedicated to improving transit travel times and reliability. − Transit Access, Safety, and Comfort Improvements: Funding infrastructure improvements that reduce the barriers to using transit, including new or enhanced features, such as, but not limited to, bus shelters, lighting, bike racks, crosswalks, transit security guards, and/or ambassadors and bus turnouts or bus pads.

4. Property Acquisition for Conservation Purposes
Property acquisition for conservation purposes is not included in CAPCOA’s Handbook and would require technical documentation and substantial evidence to support Program eligibility. This strategy would involve properties to be categorized as VMT efficient (VMT generation is lower than a defined threshold) or VMT inefficient areas (VMT is higher than a defined threshold). If land can be conserved for conservation in VMT inefficient areas, then the Program Administrator can consider designating the land acquisition as a credit- generating item.

5. Gap Financing for Affordable Infill Housing Development Gap financing for affordable infill housing development is included in CAPCOA’s 2024 Handbook and is a new strategy in mitigating VMT that is supported by Executive Order N-2-24. The order directed the California Department of Transportation (Caltrans) to identify and implement opportunities to leverage transportation funds and projects to support the use of infill housing as an environmental mitigation approach by publishing guidance on the use of affordable infill housing as a mitigation strategy as part of its Transportation Analysis Under CEQA guidance and shall track and report progress at the project level.

273

10 C. Governance

As set forth in Section I, WRCOG is designated as the Program Administrator and shall administer the Program as described in this Program Manual. Following is a description of the duties, roles, and responsibilities for the WRCOG Executive Committee, Executive Director, and Planning Director’s Committee, as they pertain to Program administration.

1. The WRCOG Executive Committee. The WRCOG Executive Committee shall be responsible for reviewing and acting on the following:
a. Approval of the Program Manual and any subsequent amendments; b. Recommendation of changes to the template agreements regarding participation in the Program; and
c. Otherwise having full final decision-making authority over all aspects of the Program.

2. The WRCOG Executive Director. Reporting to the WRCOG Executive Committee, the Executive Director (or their designee) shall be responsible for the following Program activities:
a. Administration of the Program and processing of disputes; b. Conducting ongoing monitoring of credit-generating items; c. Providing consultant support to quantify credit-generating items; d. Providing staff and consultant support to verify credit-generating items and credit users, as necessary.
e. Other related activities as directed by the WRCOG Executive Committee;
f. Executing Participation Agreements, Credit Purchase Agreements, and any amendments thereto;
g. Preparation of an Annual Report for consideration by the WRCOG Executive Committee detailing the status of the Program; and h. Periodic preparation of a comprehensive Program review that includes an assessment of the credit quantification methods and preparation of recommendations on potential Program revisions for consideration by the WRCOG Executive Committee.
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3. The WRCOG Planning Directors Committee (PDC). The PDC shall be responsible for the following:
a. Providing Program updates and reviews and input on all supporting technical documentation;
b. Recommending revisions to the Program Manual; and
c. Providing additional assistance to the Program, as requested by the WRCOG Executive Committee.

D. Administration
This section lists the key administrative processes involved in the Program.

1. Payment Processing, Credit Disbursement to Credit Users, and Payment to Credit Generators
The Program Administrator shall receive all payments generated by the exchange of credits from Credit Users to Credit Generators for credit-generating items. The Program Administrator shall account for credits and disburse credits and payments for credit-generating items, in accordance with this Program Manual.

2. Credit Generator Opt In
A credit generator must opt in to the Program through execution of a Program Participation Agreement.

3. Credit Generator Opt Out
A credit generator would opt out of the Program by providing written notice to the Program Administrator. The credit generator will be removed from the program within 90 days of providing this notice. Credit generators may not opt out of the program if there are credit generating items for which a credit purchase agreement has been executed but have not been completed.

Exhibit 2 provides an overview of the process through which a credit generator could opt-into the program.

275
Credit Generator announces
interest in program
Program Administrator provides
participation agreement
Credit Generator approves
participation agreement
Program Administrator confirms Credit
Generator participation by approving
and executing participation agreement
WRCOG Voluntary VMT Mitigation Exchange Program
Process for Credit Generators
276

13 4913-5462-9671, v. 1
A Credit Generator who has opted in can submit credit-generating items to the exchange through a Credit-Generating Item Form, provided that the credit- generating item meets the qualification criteria outlined in this Program Manual (see Section IV). The Credit-Generating Item Form will request the following:
a. Credit-generating item description.
b. Credit-generating item cost. Updates to costs of a credit-generating item already on the credit-generating item list may occur when the Program Administrator updates the list. A credit-generating item that is an operations item may include an annual escalator.
c. Information to demonstrate that the proposed credit-generating item is ready to be utilized or constructed when funding is provided). d. Sufficient information to allow the Program Administrator technical expert to quantify the VMT reduction.

Exhibit 3 outlines the process by which a Credit Generator provides credit- generating items to the Program.

4. Applications for Credits by Credit Users
a. An application must be submitted by credit users, as noted below, based on the type of credits, with VMT or environmental impact quantified to confirm the need to purchase credits to mitigate an impact. Any application must be submitted by the lead agency or lead jurisdiction where the VMT or environmental impact takes place to verify that credits are needed.

For Transportation Projects: The application must be submitted by the Implementing Agency (the Riverside County Transportation Commission, or any jurisdiction within the Western Riverside County subregion).

For Development Projects: The application must be submitted by the CEQA lead agency.

Credit users are not required to enter into a participation agreement but will enter into contractual agreements for each application. b. The Program Administrator will provide the list of available credit- generating items that can be purchased by the Credit User. 277

14 Exhibits 4 and 5 document the process by which a Credit User can request credits.

5. Procedure for Disbursement of Mitigation Projects
a. Credits will be distributed on a first-come, first-served basis upon application completion, approval by the Program Administrator, and submittal of payment to the Program Administrator for the selected credit-generating item.

6. Transfer of Credits and Refund Policy
a. A Credit User is allowed to transfer credits to another project that needs to mitigate VMT or another Credit User. The Credit User that is holding the credits must notify the Program Administrator of the transfer for purposes of maintaining an account for the credits.
b. Credit purchases are nonrefundable.

7. Reporting
The Program Administrator will prepare an Annual Report on the Program.

278
Credit Generator identifies potential
credit-generating items using
existing processes
Credit Generator submits
application for credit-generating
items
Program Administrator reviews
Program Administrator quantifies
VMT reduction
Program Administrator formally adds
credit-generating item to Program
If questions about application,
Program Administrator confers with
Credit Generator. Application revised,
if necessary.

If Credit Generator questions VMT
reduction calculation, Program
Administrator confers with Credit
Generator
Credit Generator may choose to
withdraw application during this phase
based on their discretion
WRCOG Voluntary VMT Mitigation Exchange Program
Process for Submitting Credit-Generating Items
279
Applicant Submits Land
Development Project to
Agency for Review and
Approval
CEQA Document is
Prepared
CEQA Document
Determines VMT Impact
Requiring Mitigation
Applicant Submits
Application to Request
Credit
Lead Agency for CEQA
Document Reviews and
Approves Application
for Credit
Program Administrator
Reviews and Approves
Application
Applicant Selects
Credit Generating
Item(s)
Program Administrator
Confirms Selection
Applicant Signs Credit
Purchase Agreement,
Pays for Credits
Program Administrator
Collects Funds
Funds Provided to
Credit Generator with
the Credit Generating
Item
WRCOG Voluntary VMT Mitigation Exchange Program
Process for Private Sector Requests for Credits
280
Public agency initiates
project
CEQA document is
prepared
CEQA document
determines VMT impact
requiring mitigation
Public agency submits
application to request
credit
Program Administrator
reviews and approves
application
Public agency selects
credit-generating
item(s)
Program Administrator
confirms selection
Applicant signs credit
purchase agreement,
pays for credits
Program Administrator
collects funds
Funds provided to
Credit Generator with
the credit-generating
item
WRCOG Voluntary VMT Mitigation Exchange Program
Process for Public Sector Request for Credits
281

18 8. Dispute Resolution Process and Appeals
This section details the types of Program disputes that may arise, the procedures for resolving disputes, and the process for submitting an appeal when a dispute cannot be resolved.
a. Types of Disputes
(i) Credit Generation Disputes
(1) Quantification of Credits: This type of issue arises when there is a dispute regarding the amount of credits assigned to a credit- generating item.
(2) Denial of Potential Credit-Generating Items: This type of dispute arises when a Credit Generator has submitted a credit-generating item that the Program Administrator has determined does not meet the requirements as outlined by this Program Manual.
(3) Noncompletion of Credit-Generating Item: This type of dispute arises when a proposed credit-generating item remains
uncompleted.
(4) Cost Issues: This type of dispute arises when there is either an alleged overstatement or understatement of the cost to complete a credit-generating item.
(ii) Governance Disputes
(1) Credit Allocation: This type of dispute arises when there is a dispute regarding the availability and assignment of credits in the Program. For instance, available credits are available on a first- come, first-served basis, which may create disputes if two Credit Users desire to utilize the same credit-generating item. b. Procedures
If a qualified person or entity has a Program dispute, they shall first attempt to resolve the dispute informally with Program staff. The staff of that public agency involved in the Program dispute may also participate in such discussions. If the Program dispute remains unresolved after a reasonable attempt to address it at the staff level, the qualified person or entity may submit a written appeal to the WRCOG Executive Director. 282

19 4913-5462-9671, v. 1
c. Appeals
(i) Standing to Appeal
No entity shall have standing to avail themselves of this section, except those entities who have opted into the Program as a Credit Generator, Implementing Agency, or a CEQA lead agency and have an unresolved, appealable issue or matter.
(ii) Appealable Issues and Matters
No issue or matter shall be heard or reviewed under this section unless the issue or matter is appealable and brought forth by an entity with standing to appeal. An issue or matter is appealable, if a qualified person or entity (Appellant) has a good-faith dispute directly related to the Program regarding the following disputes:
o Denial of potential credit-generating items (as defined above) o Quantification of credits (as defined above)
o Credit allocation (as defined above)
o General governance disputes (as defined above)
o Administrative fee for credit-generating items purchased for Transportation Projects by the Implementing Agency (Riverside County Transportation Commission or any jurisdiction within the Western Riverside County subregion).
(iii) Appeal Process
(1) Exhaustion of Dispute Resolution Process
Before filing an appeal pursuant to this section, the Appellant must engage in the informal dispute resolution process, as outlined in Section III.D.9.b. of this Program Manual. If the Appellant does not engage in the dispute resolution process, the matter may not be presented for appeal.
(2) Executive Director Review
(a) The Appellant shall state the basis of their appeal. Only matters raised in the appeal shall be subject to review. Any matter not raised in the appeal shall not be subject to consideration. The purpose of this limitation is to provide 283

20 adequate notice to all parties with respect to the issues on appeal and eliminate the necessity of rehearing matters not subject to challenge.
(b) The Appellant and the WRCOG Executive Director, or
designee, will attempt to hold a meeting within 30 days of the WRCOG Executive Director’s receipt of the appeal. The
WRCOG Executive Director shall then attempt to render a written decision within 15 days of the meeting, unless
otherwise notified.
(c) If the Appellant desires further review from the Program Administrator, the Appellant may submit a written request for review to the WRCOG Executive Committee chair within 90 days.
(3) Committee Review
After the written appeal is received by the WRCOG Executive Committee chair, the item shall be presented to the WRCOG Planning Directors Committee for review. At the request of either Program Administrator staff or the Appellant, the recommendation of the PDC shall be forwarded to the WRCOG Executive Committee for review and action. The Appellant shall receive written notice of the time and place of the hearing. The WRCOG Executive Committee shall review the report of the PDC regarding the appeal.

At the time set for the hearing, the Appellant may request an opportunity to be heard and to present any relevant evidence supporting the appeal. After considering the evidence presented, the WRCOG Executive Committee shall render a decision that shall be final.

The appeals process is described in Exhibit 6.
284
Appellant submits appeal
WRCOG verifies appeal eligibility
Appellant and WRCOG staff meet
within 30 days to resolve issue
If issue not resolved, appellant
submits written request for review to
WRCOG Executive Committee Chair
Planning Directors Committee
reviews appeal
If requested by either party, WRCOG
Executive Committee hears appeal
and renders final decision
Issue resolved
Issue resolved
Issue resolved
Appellant updates appeal
If appeal is not eligible or
additional information required,
WRCOG notifies appellant.

Appellant withdraws appeal
WRCOG Voluntary VMT Mitigation Exchange Program
Appeals Process
285

22 9. Liability Considerations
a. Contractual Enforcement between Program Administrator and Credit Generator
To participate in the Voluntary VMT Exchange Program, Credit Generators will be required to enter into a Participation Agreement with the Program Administrator. A template of the Participation Agreement template is included as Appendix A to this Program Manual. The Participation Agreement will address, among other items, the following:
− The rights and responsibilities of Credit Generators who submit credit-generating items.
− That credit-generating items meet the criteria outlined in this Program Manual.
− Notification to remove credit-generating items if other funding sources are attained.
− The requirement that credit-generating items can only been removed with approval of the Program Administrator.
− The exclusion of credit-generating items from being used in multiple mitigation programs or mitigation for another project requiring VMT mitigation
− A means of enforcement if issues arise with credit-generating items.
b. Contractual Enforcement between Program Administrator and Credit User
c. To participate in the Program, Credit Users will be required to enter into a Purchase Agreement, separately, with only the Program Administrator when purchasing credits for a specific credit-generating item. A copy of the Purchase Agreement template is included in this Program Manual as Appendix B.

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23 4913-5462-9671, v. 1

10. Best Practices by Program Administrator for Pending VMT Credit- Generating Items if Development Project/Transportation Project is subject to CEQA Litigation for Extended Period of Time

The Credit User for this Program assumes all risk. As is the case for any development or transportation project, there is always the possibility that protracted litigation could introduce a substantial delay in the timing between when a CEQA lead agency approves a
development/transportation project and the time when the project is actually built.1
In the event of protracted litigation delays, collaboration between the Program Administrator and the CEQA lead agency for the project approvals should occur to confirm the status of litigation resolution.

Until and unless the litigation is resolved, any mitigation imposed as part of the project approval would remain binding for the lead agency. Thus, absent a supplemental process by the CEQA lead agency to amend, delete, or replace the VMT credit-generating item that was imposed as binding mitigation, the VMT credit-generating item would be treated as “belonging” to the CEQA lead agency and would be unavailable for use by another agency.

In the event that litigation results in a rescission of the development/transportation project approvals, or in the event that the CEQA lead agency rescinds the project approvals for other reasons, the credits attained by the development/transportation project in question may be transferred to another Credit User per the provisions in III.D.7.a.

1 To be clear, the mere filing of CEQA litigation does not preclude a public agency or developer from proceeding with a project. Once the approvals are issued, those approvals are valid and can be exercised even in the face of litigation. However, proceeding in the face of litigation is done at the agency or applicant’s own risk. Thus, CEQA petitioners may choose to pursue court injunctions to affirmatively stop development from proceeding at any point during the litigation’s pendency. Similarly, an adverse ruling from a court on the merits of the case could result in the rescission of approvals or other relief that would cause any project activity to cease. Because of these risks and costs, sometimes proponent agencies and/or applicants choose not to proceed with construction of approved projects, until and unless the litigation is resolved in their favor. 287

24 11. Administrative Costs.

The Program Administrator is allowed to expend a maximum of 4 percent of funds generated for the exchange of credits from the Credit User to the Credit Generator for the credit-generating item. The maximum 4 percent of funds will be used solely to carry out the responsibilities to implement and administer the Program. Eligible expenses will include staff salaries, consultant expenses, legal fees, and agency overhead expenses needed to support the Program. Through the development of its Annual Budget, WRCOG will provide a regular update regarding program revenues and expenses.

12. Relationship to Other VMT Mitigation Programs
Agencies who elect to participate in the Voluntary VMT Mitigation Program can also elect to participate in other State, regional, and local VMT Mitigation Programs at their discretion. Additionally, participation in the Voluntary VMT Mitigation Program does not preclude a Credit Generator from operating their own program.

The only limitation related to the participation in multiple programs is that a Credit Generator may not submit the same Credit-generating item to multiple programs. Credit Generators will be asked to certify that any Credit-generating item submitted to the Voluntary VMT Mitigation Program has not been submitted to any other program.

E. Exchange Menu
Credit-generating items will be presented in a menu that will include the VMT-reducing project(s) and/or program(s), the total cost to implement, and the quantified VMT reduction potential of each. The Program Administrator will compile the menu from submitted and accepted Credit-Generating Item Forms from the agencies that opt into the program. This menu will be provided to Credit Users.

13. Non-Exhaustive List of Sample Non-Exclusive Mitigation Projects This table illustrates how credit-generating items might be listed in the Program for purchase by Credit Users.
288

25 4913-5462-9671, v. 1
Sample Project VMT Credit Cost
Purchase of transit
passes
XX VMT reduced per day
per transit pass
purchased
XX per transit pass
Implement bicycle lane XX VMT reduced per day
once constructed
XX (capital cost)
Implement sidewalk XX VMT reduced per day
once constructed
XX (capital cost)

14. Outreach Process to Solicit Mitigation Projects
On a regular basis, the Program Administrator will solicit projects from Credit Generators to serve as credit-generating items. The Program Administrator will determine which category in Section III.B the item will fall into. Once approved, the Credit-Generating Item will be added to the Exchange Menu.

15. Ongoing Review of Mitigation Projects
To ensure credit-generating items are still active and eligible for generating credit, the VMT Program Administrator will periodically review the projects included in the Exchange Menu and may request updates from Credit Generators.

As part of this review, the Program Administrator shall request updated cost estimates for any credit-generating item from the Credit Generators on at least an annual basis. Credit generators may also provide updated cost information to the Program Administrator for the specific credit-generating item more frequently at their discretion.

F. Participants
The following agencies make up an initial list of Credit Generators eligible to opt in to the Program. Once a Credit Generator has opted in, they are eligible to opt out at any time, provided they follow the protocol set forth in this Program Manual. ▪ Riverside Transit Agency (RTA)
▪ Riverside County Transportation
Commission (RCTC)
▪ Western Riverside County
Regional Conservation Authority
(RCA)
▪ County of Riverside
▪ City of Banning
▪ City of Beaumont
▪ City of Calimesa
▪ City of Canyon Lake
▪ City of Corona
289

26 ▪ City of Eastvale
▪ City of Hemet
▪ City of Jurupa Valley
▪ City of Lake Elsinore
▪ City of Menifee
▪ City of Moreno Valley
▪ City of Murrieta
▪ City of Norco
▪ City of Perris
▪ City of Riverside
▪ City of San Jacinto
▪ City of Temecula
▪ City of Wildomar
IV. QUALIFICATION CRITERIA FOR CREDIT-GENERATING ITEMS
Following are the criteria for approval of credit-generating items:

1. The Credit Generator has a Participation Agreement on file with the Program Administrator;

2. The proposed credit-generating item has provided a cost estimate to construct or implement the credit-generating item and enough clear, consistent, and transparent information to quantify VMT reduction potential. Information needed to quantify VMT reduction potential will vary by credit-generating item. The quantification of VMT credits generated on the proposed credit-generating item will be calculated by a technical expert provided by the Program Administrator. Refer to Appendix C for details on what information is required.

V. QUANTIFICATION OF CREDIT-GENERATING ITEMS
A. General Principles for Credit Quantification
Quantification of potential VMT reduction of credit-generating items should be based on the best available data and resources. Quantification should be clearly and consistently documented with all sources cited.

Credit-generating items with quantified VMT reduction in the latest version of the Handbook for Analyzing Greenhouse Gas Emission Reductions, Assessing Climate Vulnerabilities, and Advancing Health and Equity (GHG Handbook) (CAPCOA 2024) would be utilized as the basis for the quantification of many of the anticipated credit- generating items. This would include mitigation projects, such as constructing a bike lane or introducing a new transit line. In the future, if a more robust or up-to-date technical resource is available and accepted as the industry standard for VMT reduction quantification, this should be referenced for credit quantification.

More innovative or programmatic strategies that are not quantified in the GHG Handbook would require a customized approach based on the credit-generating item.

Customized calculations using alternative data sources, like the Riverside County Transportation Model (RIVCOM), or tracking/surveying participants would be used to 290

27 4913-5462-9671, v. 1
determine how much VMT would be reduced. Innovative or programmatic strategies subject to customized calculations would include mitigation projects or programs, such as The Nature Conservancy partnerships or a land exchange.

All quantification will be prepared and reviewed by a qualified technical expert with relevant experience through the Program Administrator.

B. Standardized Calculation Methods
Each credit-generating item may utilize a different methodology depending on whether the GHG Handbook is the appropriate resource or if a customized approach is required. A quantification form(s) to quantify the number of credits an item generated will be provided with the intent for calculations to be standardized.

291

28 VI. APPENDICES
APPENDIX A.

Template agreement to participate in the Program, for Credit Generators to provide credit-generating items to the Program, and for the Program Administrator to administer the Program.).

APPENDIX B.

Template agreement between a Credit User and the Program Administrator to purchase credits for a specific project/program.

APPENDIX C.

Calculation worksheets for submission of a credit-generating item.

292
WRCOG, in partnership with its member agencies and key regional stakeholders, has developed a voluntary exchange program (Program) to provide a method to mitigate vehicle miles traveled (VMT) impacts under the California Environmental Quality Act (CEQA). WRCOG will serve as the Program Administrator and main point of coordination for Participants. The voluntary Program will provide Participants in need of a way to offset significant VMT impacts will be able to purchase VMT credits generated by participants with VMT credit-generating projects.

Key T erms / Who Should be Interested?
Benefits of a Regional Program
• Applicant : A developer or similar entity applying to purchase credit(s) as a credit user • Credit: VMT reduction credit.
• Credit Generator: A public agency that implements a project or program that produces a VMT reduction credit. Credit generators will enter into a Participation Agreement with the Program Administrator. This agreement enables public agencies to submit credit-generating items to the Program that are eligible to receive funding through the Program.
• Credit-generating Item: A specific project or program that has produced or may produce a credit.
• Credit User: Land development or transportation project administrator that needs VMT reduction credits for CEQA mitigation.
• VMT Impact: The generation of VMT above the applicable threshold of significance by a project, which may require a Credit User to seek a mitigating credit(s). 293
Is it a mandatory program?

FREQUENT ASKED QUESTIONS