Agenda packet, regular meeting — National City City Council, June 20, 2023 (part 1 of 7)

AGENDA
Consolidated Regular Meeting
City Council Chamber - 1243 National City
Boulevard, National City, CA
Ron Morrison, Mayor
Luz Molina, Vice-Mayor Armando Vergara, Interim City Manager Marcus Bush, Councilmember Barry J. Schultz, City Attorney Jose Rodriguez, Councilmember Shelley Chapel, MMC, City Clerk Ditas Yamane, Councilmember R. Mitchel Beauchamp, City Treasurer _______________________________________________________________________

The City Council also sits as the City of National City Community Development Commission, Housing Authority, Joint Powers Financing Authority, and Successor Agency to the Community Development Commission as the National City Redevelopment Agency
Thank you for participating in local government and the City of National City Council Meetings.

Meetings: Regular City Council Meetings are held on the first and third Tuesday of the month at 6:00 p.m. Special Closed Session Meeting and Workshops may be same day, t he start time is based on needs. Check Special Agendas for times.

Location: Regular City Council Meetings are held in the Council Chamber located at City Hall, 1243 National City Boulevard, National City, CA 91950, the meetings are open to the public.

Agendas and Material: Agendas and Agenda Packet for items listed are available on the City website, and distributed to the City Council no less than 72 hours prior to the Ci ty Council Meeting. Sign up for E-Notifications to receive alerts when items are posted.

Public Participation: Encouraged in a number of ways as described below. Members of the public may attend the City Council Meeting in person, watch the City Council Meeting via live web stream, or participate remotely via Zoom. Recording of Meetings are archived and available for viewing on the City’s website.

Public Comment: Persons wishing to address the City Council on matters not on the agenda may do so under Public Comments. Those wishing to speak on items on the agenda may do so when the item is being considered. Please submit a Speaker’s Slip to the City Clerk prior to the meeting or immediately following the announcement of the item. All commen ts will be limited up to three (3) minutes. The Presiding Officer shall have the authority to reduce the time allotted to accommodate for a large number of speakers. (City Council Policy 104) If you wish to submit written comment email to the City Clerk’s Office at least 2 hours prior to the City Council Meeting to allow time for distribution to the City Council.

Spanish Interpretation Services: Spanish Interpretation Services are available, please contact the City Clerk prior to the start of the meeting for assistance.

American Disabilities Act Title II: In compliance with the American Disabilities Act of 1990, persons with a disability may request an agenda in appropriate alternative formats as required by Title II. Any person with a disability who requires a modification or accommodation in order to participate in a meeting should direct such request to the City Clerk’s Office (619) 336 -4228 at least 24 hours in advance of the meeting.

The City Council also sits as the City of National City Community Development Commission, Housing Authority, Joint Powers Financing Authority, and Successor Agency to the Community Development Commission as the National City Redevelopment Agency
Gracias por participar en las reuniones del gobierno local y del Consejo de la Ciudad de National City.

Reuniones: Las reuniones regulares del Consejo Municipal se llevan a cabo el primer y tercer martes del mes a las 6:00 p.m. La reunión especial de sesión privada y los talleres pueden ser el mismo día, la hora de inicio se basa en las necesidades. Consulte las agendas especiales para conocer los horarios.

Ubicación: Las reuniones regulares del Concejo Municipal se llevan a cabo en la Cámara del Consejo ubicada en el Ayuntamiento, 1243 National City Boulevard, National City, CA 91950, las reuniones están abiertas al público.

Agendas y Material: Las Agendas y el Paquete de Agenda para los temas enumerados están disponibles en el sitio web de la Ciudad y se distribuyen al Concejo Municipal no menos de 72 horas antes de la Reunión del Concejo Municipal. Regístrese par a recibir notificaciones electrónicas cuando se publiquen artículos.

Participación pública: Se fomenta de varias maneras como se describe a continuación. Los miembros del público pueden asistir a la Reunión del Concejo Municipal en persona, ver la Reunión del Concejo Municipal a través de la transmisión web en vivo o participar de forma remota a través de Zoom. Las grabaciones de las reuniones están archivadas y disponibles para su visualización en el sitio web de la Ciudad.

Comentario Público: Las personas que deseen dirigirse al Concejo Municipal sobre asuntos que no están en la agenda pueden hacerlo bajo Comentarios públicos. Quienes deseen hacer uso de la palabra sobre los temas del programa podrán hacerlo cuando se esté examinando el tema.

Por favo r, envíe una solicitud del orador al Secretario de la Ciudad antes de la reunión o inmediatamente después del anuncio del artículo. Todos los comentarios estarán limitados a tres (3) minutos. El Presidente tendrá la autoridad para reducir el tiempo asignado para dar cabida a un gran número de oradores. (Política del Concejo Municipal 104) Si desea enviar comentarios por escrito, envíe un correo electrónico a la Oficina del Secretario de la Ciudad al menos 2 horas antes de la Reunión del Consejo Municipal para dar tiempo a la distribución al Consejo Municipal.

Servicios de interpretación en español: Los servicios de interpretación en español están disponibles, comuníquese con el Secretario de la Ciudad antes del inicio de la reunión para obtener ayuda.

Título II de la Ley de Discapacidades Americanas: En cumplimiento con la Ley de Discapacidades Americanas de 1990, las personas con discapacidad pueden solicitar una agenda en formatos alternativos apropiados según lo requerido por el Título II. Cualquier per sona con una discapacidad que requiera un modificación o adaptación para participar en una reunión debe dirigir dicha solicitud a la Oficina del Secretario de la Ciudad (619) 336 -4228 al menos 24 horas antes de la reunión.

AGENDA
Consolidated Regular Meeting

Tuesday, June 20, 2023, 6:00 p.m.

City Council Chamber - 1243 National City Boulevard
National City, CA
Pages

1. CALL TO ORDER

2. ROLL CALL

3. PLEDGE OF ALLEGIANCE TO THE FLAG

4. PUBLIC COMMENT
In accordance with State law, an item not scheduled on the agenda may be brought forward by the general public for comment; however, the City Council will not be able to discuss or take action on any issue not included on the agenda. Speakers will have up to three (3) minutes.

5. PROCLAMATIONS AND RECOGNITION

5.1 Juneteenth Day 9

5.2 Employee of the Quarter - Police Sergeant Michael "Scott" Shanahan. 10

6. PRESENTATION (Limited to Five (5) Minutes each)

6.1 National City Brownfields Assessment Project by San Diego State University. 13 Recommendation:

Review the presentation by SDSU staff and provide comments.

7. REGIONAL BOARDS AND COMMITTEE REPORTS (Limited to Five (5) Minutes each)

8. CONSENT CALENDAR
The Consent Calendar may be enacted in one motion by the City Council with a Roll Call Vote without discussion unless a Councilmember, a member of the Public, or the City Manager request an item be removed for discussion. Items removed from the Consent Calendar will be considered immediately following the adoption of the Calendar.

8.1 Approval of Reading by Title Only and Waiver of Reading in Full of Ordinance on this Agenda

8.2 Approval of City Council Meeting Minutes 27
Recommendation:

Approve and File.

8.3 Agreement Between City of National City and Chandler Asset Management, Inc.
31 Recommendation:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Agreement By and Between the City of National City and Chandler Asset Management, Inc. for Investment Management and Advisory Services.”

8.4 Agreement between the City of National City and the Pun Group, LLP. 68 Recommendation:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California authorizing the Mayor to execute an agreement with The Pun Group, LLP For Professional Independent Audit Services”.

8.5 Amending the Confidential Group Salary Schedule to Revise the Salary of the Senior Information Technology Analyst for 2023 and 2024. 87 Recommendation:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Amending the Confidential Group Salary Schedule.”

8.6 Approval of Amendment to Agreement with San Diego County for Senior Nutrition Services
93 Recommendation:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Amendment to County Contract 561763 Extending the Contract Term for Six (6) Additional Months Through December 31, 2023.”

8.7 Approval of Agreement Between the City of National City and the National City Host Lions Club
159
Recommendation:

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Adopt a Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing the City Manager to Enter into an Agreement with the National City Host Lions Club in the Not-to-Exceed Amount of $7,750 to Facilitate the Fourth of July Carnival from Friday, June 30, 2023 to Tuesday, July 4, 2023.”

8.8 Approval of Agreements with San Diego Gas and Electric Company, BNSF Railway Company, San Diego Metropolitan Transit System, and the San Diego Unified Port District for Segment 5 of the Bayshore Bikeway in National City. 188
Recommendation:

Adopt Resolutions Entitled:
1) “Resolution of the City Council of the City of National City, California, authorizing the Mayor to Execute the Agreement with San Diego Gas & Electric Company for the Purpose of Construction, Planting Mitigation, Monitoring, Operation, Inspection, Maintenance, Repair and Replacement of the Bike Path for Segment 5 of the Bayshore Bikeway in the City of National City;” and, 2) “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Agreement with BNSF Railway Company for the Purpose of Construction, Plant Mitigation, Operation, Inspection, Maintenance, Repair and Replacement of the Bike Path for Segment 5 of the Bayshore Bikeway in the City of National City;” and,
3) “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Agreement with San Diego Metropolitan Transit System for the Purpose of Construction, Planting Mitigation, Monitoring, Operation, Inspection, Maintenance, Repair and Replacement of the Bike Path for Segment 5 of the Bayshore Bikeway in the City of National City;” and, 4) “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Agreement with the San Diego Unified Port District for the Purpose of Construction, Planting Mitigation, Monitoring, Operation, Inspection, Maintenance, Repair and Replacement of the Bike Path for Segment 5 of the Bayshore Bikeway in the City of National City.”

8.9 Approval of a Three (3) year Contract for a Not-to-Exceed Amount of $2 Million Dollars with Circuit Transit Inc. with an Option for Two (2) One-Year Extensions Depending on Available Funds to Provide the Free Ride Around National City (FRANC) Shuttle Prog
363
Recommendation:

Adopt a Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing the Use of Cooperative Procurement with SANDAG’s Regional Flexible Fleet Services Procurement Process to Award a Three (3) Year Contract for a Not-to-Exceed Amount of $2 Million Dollars to Circuit Transit Inc. with an Option for Two (2) One-Year Extensions Depending on Available Funding to Provide the Free Ride Around National City (FRANC) Shuttle Program.

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8.10 Authorize the Acceptance of the California Automated Permit Processing Program Grant
382
Recommendation:

Adopt a Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing the City Manager or Designee to Accept the California Automated Permit Processing Program Grant in the Amount of $60,000 from the California Energy Commission to Fund the National City Building Division’s Implementation of an Online Solar Permitting Platform and Authorizing the Establishment of a Community Development Reimbursable Grant Fund Appropriation of $60,000 and Corresponding Revenue Budget.”

8.11 Approval of a Second Amendment to the Agreement between the City and Devaney Pate Morris & Cameron LLP for legal services in the specialized area of General Civil Litigation Defense arising from Government Claims. 401
Recommendation:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Approving a Second Amendment to the Agreement Between the City and Devaney Pate Morris & Cameron LLP for Legal Services in the Specialized Area of General Civil Litigation Defense Arising from Government Claims by 1) Increasing the Not-to-Exceed Amount by $50,000 for a New Total Not-to-Exceed Amount of $250,000 Pertaining to Litigation Titled Bhandari v. City and 2) Increasing the Not-to-Exceed Amount by $50,000 for a New Total Not-to-Exceed Amount of $200,000 Pertaining to Litigation Titled Cummins v. City.”

8.12 First Amendments to On-Call Consultant Agreements for City’s Capital Improvement Program (CIP)
407
Recommendation:

Adopt a Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute First Amendments to Extend Agreements by One-Year with the Following On-Call Consultants: a) Atlas Technical Consultants, LLC; b) D-MAX Engineering, Inc.; c) Geosyntec Consultants, Inc.; d) Leighton Consulting, Inc.; e) Ninyo & Moore Geotechnical & Environmental Sciences Consultants; and, f) Randall Lamb Associates, Inc.”

8.13 First Amendment with San Diego Mechanical Energy, Inc. for Facilities Maintenance Services
425
Recommendation:

Adopt a Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute a First Amendment to the Agreement with San Diego Mechanical & Energy, Inc., Extending the Agreement by One-Year to June 30, 2024.”

8.14 First Amendment to the Agreement with Southwest Traffic Signal, Inc., for Traffic Signal and Streetlight Maintenance
431

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Recommendation:

Adopt a Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute a First Amendment to the Agreement with Southwest Traffic Signal Service, Inc., Extending the Agreement by One-Year to June 30, 2024.”

8.15 Memorandum of Understanding (MOU) Between the San Diego Unified Port District and the City of National City to Contribute Funds for the Free Ride Around National City (FRANC) Program.
437
Recommendation:

Adopt a Resolution Entitled, "Resolution of the City Council of the City of National City 1) Authorizing the Mayor to Execute a Memorandum Of Understanding Between the San Diego Unified Port District and the City of National City to Contribute Funds from the Maritime Industrial Impact Fund for the Funding of the Free Ride Around National City (FRANC) Program; and 2) Authorizing the Establishment of $400,000 in Appropriations and a Corresponding Revenue Budget.”

8.16 Sole Source Purchase of a Phoenix G2 Fire Station Alerting System 446 Recommendation:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Waiving the Formal Bid Process Pursuant to National City Municipal Code Section 2.60.220 (B) Regarding the Sole Source Purchase of the Phoenix G2 Fire Station Alerting System for the National City Fire Department, from US Digital Designs (USDD) for a Not-To-Exceed Amount of $158,504.85.”

8.17 Sole Source Installation of the Phoenix G2 Fire Station Alerting System by Bergelectric
468
Recommendation:

Adopt the Resolution, Entitled, “Resolution of the City Council of the City of National City, California, Waiving the Formal Bid Process Pursuant to National City Municipal Code Section 2.60.220 (B) Regarding the Sole Source Installation of the Phoenix G2 Fire Station Alerting System for the National City Fire Department by Bergelectric for a Not-to-Exceed Amount of $86,150.00 and Authorizing Additional Budget Appropriations of $74,654.85 from General Fund Unassigned Fund Balance for Said Installation.”

8.18 Annual Appropriations Limit for Fiscal Year 2024 486 Recommendation:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Approving and Adopting the Annual Appropriations Limit of $80,226,080 for Fiscal Year 2024”

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8.19 Successor Agency Proposed Budget for Fiscal Year 2023-24 489 Recommendation:

Adopt the Proposed Budget for the Successor Agency for Fiscal Year 2023-24.

8.20 Investment Report for the Quarter Ended March 31, 2023. 494 Recommendation:

Accept and File the Investment Report for the Quarter Ended March 31, 2023.

8.21 Investment transactions for the month ended April 30, 2023. 525 Recommendation:

Accept and file the Investment Transaction Ledger for the month ended April 30, 2023.

8.22 Warrant Register #45 for the period of 5/5/23 through 5/11/23 in the amount of $1,380,114.63.
531
Recommendation:

Ratify Warrants Totaling $ 1,380,114.63

8.23 Warrant Register #46 for the period of 5/12/23 through 5/18/23 in the amount of $2,374,502.87.
537
Recommendation:

Ratify Warrants Totaling $ 2,374,502.87

9. PUBLIC HEARING
The following item(s) have been advertised as public hearing(s) as required by law.

9.1 Public Hearing and Review of the Focused General Plan Update’s Supplemental Program Environmental Impact Report and California Environmental Quality Act Findings.
541
Recommendation:

Hold the Public Hearing, Discuss the Project and the Alternate Project Location Alternative, and Consider the National City Planning Commission’s Recommendation In-Favor of the Alternate Project Location Alternative.

9.2 Public Hearing and Resolution Confirming the Assessment and Ordering the Levy for the Landscape Maintenance District No. 1 (Mile of Cars) for Fiscal Year 2023-24.
591
Recommendation:

Adopt the Resolution entitled “Resolution of the City Council of the City of National City, California, Confirming the Assessment and Ordering the Levy for the Landscape Maintenance District No. 1 (Mile of Cars) for Fiscal Year 2023-

24.”

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9.3 Public Hearing and adoption of a Resolution accepting the National City Fiscal Year 2023-2024 Tax Roll Sewer Service Fees Report.
594
Recommendation:

Hold a Public Hearing and Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Accepting the National City 2023-2024 Tax Roll Sewer Service Fees Report, Which Identifies by Parcel Number, Each Parcel of Real Property Receiving Sewer Services and the Amount of Sewer Charges for Each Parcel for FY 2023-24 as Required by the California Health and Safety Code Section 5473 et seq., Pertaining to Collection of Sewer Charges on the Tax Roll, Directing the City Clerk to File the Report with the County of San Diego Auditor and Controller, and Directing the City Engineer to Submit a Certification of the Sewer Service Charges to the County of San Diego Auditor and Controller.”

10. STAFF REPORTS

10.1 Verbal Report-Out of Salary and Benefits in the Employment Agreement of the Interim City Manager as required by the Brown Act
680
Recommendation:

Consider Adoption of the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Appointing Armando Vergara as Interim City Manager and Authorizing the Mayor to Execute an Employment Agreement Between the City of National City and Armando Vergara with the Effective Date of June 1, 2023.”

10.2 Cannabis Business Development Agreements 690
Recommendation:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Approving the Cannabis Business Development Agreements with Mr. Nice Guy, Element 7 and NC Investment Group.”

10.3 City of National City Annual Comprehensive Financial Report (ACFR) for the Fiscal Year Ended June 30, 2022.
738
Recommendation:

Accept and File the Report.

10.4 Fiscal Year 2023 Third Quarter Budget Review 974
Recommendation:

Accept and File this Report, and Adopt a Resolution Entitled, “Resolution of the City Council of the City of National City, California, Authorizing Various Fiscal Year 2023 3rd Quarter Budget Adjustments.”

10.5 Resolution of the City Council of the City of National City Adopting a Budget for Fiscal Year 2024
982

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Recommendation:

Adopt a Resolution Entitled, “Resolution of the City Council of the City of National City, California, Adopting a Budget for the Fiscal Year 2024.”

10.6 City Council Discussion and Direction Regarding Revisions to City Council Policy No. 104: Rules of Procedural and Order for City Council Meetings 987
Recommendation:

Discuss and Provide Direction to Staff Regarding Revisions to the City Council Policy No. 104: Rules of Procedural and Order for City Council Meetings; XIV Procedural Matters, E (Proclamations).

11. CITY MANAGER’S REPORT

12. ELECTED OFFICIALS REPORT

13. CITY ATTORNEY REPORT

14. ADJOURNMENT
Regular Meeting of the City Council of the City of National City - Tuesday, August 1, 2023 - 6:00 p.m. - Council Chambers - National City, California.

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PRESENTATION

Department: Housing Authority
Prepared by: Angelita Palma, Housing Programs Manager Meeting Date: Tuesday, June 20, 2023
Approved by: Armando Vergara, Interim City Manager

SUBJECT:

National City Brownfields Assessment Project by San Diego State University.

RECOMMENDATION:

Review the presentation by SDSU staff and provide comments.

BOARD/COMMISSION/COMMITTEE PRIOR ACTION:

Not Applicable.

EXPLANATION:

San Diego State University (SDSU) has been awarded two grants to support community- wide assessment of brownfields in National City, California. These grants were awarded by the Environmental Protection Agency’s (EPA’s) Brownfields Grant Program ($500,000) and the California Department of Toxic Substances Control’s (DTSC’s) Equitable Community Revitalization Grant (ECRG) Program ($296,762). The grant periods are three and two years, respectively, which began in Summer 2022.

A brownfield is a piece of land where its use or reuse may be complicated by the presence or potential presence of contamination due to past uses. National City’s long history of industrial activity, proximity to freeways, and mixed and often incompatible land uses have created multiple paths for environmental contamination and many brownfields. The City is disproportionately impacted by numerous economic and health disparities as compared to county, state, and US levels, with National City neighborhoods having some of the highest levels o f pollution burden regionally. Environmental assessment and planning are critical to promoting better environmental and community health. Community engagement in this process is critical to identifying brownfields sites, elaborating on community priorities, generating shared knowledge on local challenges, and identifying solutions.

Since 2013, SDSU has successfully partnered with and provided added capacity to the City in identifying solutions for stormwater runoff, greening streets in the downtown area, improving active transportation infrastructure, air quality assessments, disaster preparedness and response, developing a property management plan, and installation of public art throughout the community, and other revitalization and redevelopment projects through the Sage Project.

Building on this long -standing, mutually beneficial collaboration, SDSU will leverage their own personnel, expertise, and administrative infrastructure to create capacity and oversee this Project to address brownfields in the City , in collaboration with a brownfields advisory committee, community partners, and community stakeholders.

Project activities are organized around four main areas: 1) brownfield site identification 2) site prioritization 3) environmental assessments and 4) reuse planning. Four priority sites have already been identified as part of the grant application process for environmental site assessment.

These sites were selected based on site access, community input and City priorities: 921 National City Blvd (Former Education Center), 929 National City Blvd (Steamed Bean), 1028 A Avenue,

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and 140 W 18th St (Welding Shop). Additional sites will be identified and prioritized in coordination with Project Partners and community members. The grant funding cannot be used for remediation and site cleanup activities, construction, or development.

For more information on the Project and to stay up to date, visit https://brownfields.sdsu.edu/. For additional inquiries related to the work, please contact project leads: Dr. Jessica Barlow ([email protected]) or Dr. Madison Swayne ([email protected]).

FINANCIAL STATEMENT:

Grant funding will be administered by San Diego State University.

RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:

Health, Environment, and Sustainability

ENVIRONMENTAL REVIEW:

Not applicable

PUBLIC NOTIFICATION:

Agenda Report posted within 72 hours of meeting date and time in accordance with Brown Act.

ORDINANCE:

Not Applicable

EXHIBIT:

Exhibit A – Power Point Presentation

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Jessica Barlow, Professor
San Diego State University
June 20, 2023
National City Brownfields
Assessment Project

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What is a brownfield?
• A brownfield is a piece of land where
its use or reuse may be complicated
by the presence or potential
presence of contamination due to
past uses
• Often, environmental testing is
necessary to determine actual site
conditions
EPA 560F19006 handout

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Why SDSU?
Collaborating with the National City community since
2013, through the Sage Project and the launch of
BrightSide Produce.

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Grants + Funding
US Environmental Protection Agency* (EPA)
Brownfield Grants Program, Community-Wide Assessment
Grant ($500,000) [3 years]
CA Department of Toxic Substances Control* (DTSC)
Equitable Communities Revitalization Grants (ECRG)
Program, Community-Wide Assessment Grant ($296,762)
[2 years]
*Funds do not support:

Remediation and site cleanup activities
Construction, development

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Planned Activities
Brownfield Site
Identification
Compile a list of
brownfields in National
City and identify past
uses using resident
expertise, existing
databases of
environmental
contamination, and
mapping software
(GIS)
Site Prioritization
Develop site
prioritization criteria.

These criteria may
include (but are not
limited to) community
planning priorities, site
location and size, past
use, neighborhood
context
Environmental
Assessments
Determine existing
environmental
contamination through
Phase 1 and Phase 2
Environmental Site
Assessments
Reuse Planning
Coordinate future site
plans based on
community priorities
and site conditions
Community Engagement

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Planned Activities
Brownfield Site
Identification Site Prioritization Environmental
Assessments Reuse Planning
Year 1
Year 2
Year 3
Community Engagement
we are here!

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Brownfields Advisory Committee
Jessica Barlow
San Diego State U
Madi Swayne
San Diego State U
Kristofer Patrón
San Diego State U
Chris Clark
Urban Land Institute
Tatiana Perez
Urban Land Institute
Monserrat Hernandez
Environmental Health
Coalition
Jim O’Callaghan
South County EDC
Janet Barragán
County of San Diego
Carlos Aguirre
City of National City

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Former Education Center
921 National City Blvd
Steamed Bean
929 National City Blvd
A Ave Parcel
1028 A Ave
Welding Shop
140 W 18th St
Brownfield Initial Priority Sites

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Community Kick-Off Event
March 23, 2023, at ARTS
• Overview to brownfields,
the project and the grants
• Site nomination activity
• Contribute to development of
site inventory
• Prepare for prioritization of
additional sites
https://bit.ly/BFsEventHandouts

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Brownfields Site Nomination
• Complete online site nomination at
our website or by using this QR
code or on our website (in English
or Spanish)
• Available through end of July
http://bit.ly/NC-BFs-nominate-a-site

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Save the Date!
What: Brownfields Site Prioritization Community Meeting When: Wednesday, August 2, 2023, 5:30-7p
Where: A Reason To Survive (ARTS), 200 E 12th St, National City Who: Everyone welcome!
Snacks and refreshments will be provided, and coloring stations will be made available for children who attend
Spanish/English live interpretation will be provided

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Connect with us
Website: brownfields.sdsu.edu
Email: [email protected]
Facebook: @SDSUBrownfields
Instagram: @brownfields.sdsu

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AGENDA REPORT

Department: City Clerk's Office
Prepared by: Shelley Chapel, MMC, City Clerk
Meeting Date: Tuesday, June 20, 2023
Approved by: Armando Vergara, Interim City Manager

SUBJECT:

Approval of City Council Meeting Minutes

RECOMMENDATION:

Approve and File.

BOARD/COMMISSION/COMMITTEE PRIOR ACTION:

Not Applicable.

EXPLANATION:

Meeting Minutes:

Budget Workshop Meeting of May 23, 2023

FINANCIAL STATEMENT:

Not Applicable.

RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:

Not Applicable

ENVIRONMENTAL REVIEW:

This is not a project under CEQA and is therefore not subject to environmental review.CCR15378; PRC 21065.

PUBLIC NOTIFICATION:

Agenda Report posted within 72 hours of meeting date and time in accordance with Brown Act.

ORDINANCE:

Not Applicable

EXHIBIT:

Exhibit A – Budget Workshop Meeting of May 23, 2023

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SPECIAL MEETING MINUTES OF THE CITY COUNCIL WORKSHOP
May 23, 2023, 4:00 p.m.

City Council Chamber - 1243 National City Boulevard
National City, CA

Present: Mayor Morrison
Vice-Mayor Molina
Councilmember Bush
Councilmember Rodriguez
Councilmember Yamane

Others Present: Armando Vergara, Acting City Manager
Barry J. Schultz, City Attorney
Shelley Chapel, City Clerk
Carlos Aguirre, Housing Authority Director
Molly Brennan, Administrative Services Director
Jose Tellez, Chief of Police
Ben Martinez, Acting Community Development Director
Sergio Mora, Fire Battalion Chief (via Zoom)
James Stiles, Fire Captain
Joyce Ryan, Library & Community Services Director
Paul Valadez, Budget Manager
Roberto Yano, Director of Public Works and City Engineering ____________________________________________________________________

1. CALL TO ORDER
A Special Meeting of the City Council of the City of National City was called to order at 4:07 p.m. by Mayor Morrison via teleconference and in the Council Chamber, located in City Hall, 1243 National City Boulevard, National City, California.

2. ROLL CALL
Councilmembers present: Bush, Rodriguez, Yamane, Molina, and Morrison Interpretation in Spanish provided by Ruth Monroy and Andrew Monroy

3. PLEDGE OF ALLEGIANCE TO THE FLAG
Mayor Morrison requested Councilmember Bush to lead the Pledge of Allegiance.

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4. PUBLIC COMMENT
Mayor Morrison summarized the process for acceptance of live public comment allowing three (3) minutes per comment and introduced City Clerk Chapel.

Four (4) speakers provided in-person comments, one (1) written via eSCRIBE, and one (1) written comment was received.

In-person comments:

Ted Godshalk, Nancy Estolano, Edward Nieto, and Kelsey Genesi

Written comment received, not read into the record:

Ted Godshalk, and Larry Emerson

5. STAFF REPORT

4.1 Fiscal Year 2023-2024 Preliminary Budget Workshop
Review, receive presentation, and provide direction.

Acting City Manager Vergara introduced Director of Administrative Services Molly Brennan who presented the item.

One-Time Expenditures
ACTION: Motion by Councilmember Bush, seconded by Councilmember Rodriguez to include District Budgeting of $100,000 per Councilmember totaling $500,000 including the current Mayor budget. The budget would include staff for each Councilmember.

Ayes: Bush, Rodriguez, Yamane, Molina
Nays: Morrison
ACTION: Motion by Councilmember Rodriguez, seconded by Councilmember Bush to support after-school programming at a rate of 15% for National City Res idents for Cost Recovery. Motion carried unanimously.

On-Going Enhancements
Vice-Mayor Molina left the dais at 6:12 p.m. and returned at 6:14 p.m.

Councilmember Rodriguez left the dais at 6:12 p.m. and returned at 6:14 p.m.

Meeting was paused for a 5-minute break.

Councilmember Rodriguez left the dais at 7:39 p.m. and returned at 7:41 p.m.

Motion by Councilmember Bush, seconded by Councilmember Rodriguez to direct staff to return with a final budget and consider revenue increases and offsets to the existing enhancements list and offsets including the Cannabis Tax, District Transaction and Use Tax, and Transient Lodging Tax. Ways to increase those and include other revenue. Also, would like to direct all departments to look at reductions/cuts to Professional Services/Contractual Services. Expanding licenses for Cannabis businesses.

Motion carried unanimously.

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Further discussion to occur at a Special Budget Workshop scheduled for an undetermined date.

6. ADJOURNMENT
Mayor Morrison adjourned to the Regular Meeting of the City Council of the City of National City, Tuesday, June 6, 2023, 6:00 p.m. in the Council Chamber, located in City Hall, 1243 National City Boulevard, National City, California.

The meeting adjourned at 8:02 p.m.
________________________________
Shelley Chapel, MMC, City Clerk

The foregoing minutes were approved at the Regular Meeting of June 20, 2023.

__________________________
Ron Morrison, Mayor

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AGENDA REPORT

Department: Administrative Services - Finance
Prepared by: Phillip Davis, Financial Analyst
Meeting Date: Tuesday, June 20, 2023
Approved by: Armando Vergara, Interim City Manager

SUBJECT:

Agreement Between City of National City and Chandler Asset Management, Inc.

RECOMMENDATION:

Adopt the R esolution E ntitled, “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Agreement By and Between the City of National City and Chandler Asset Management, Inc. for Investment Management and Advisory Services.”

BOARD/COMMISSION/COMMITTEE PRIOR ACTION:

Not Applicable.

EXPLANATION:

Role of the Investment Official
Under California law, the governing body of a local agency has primary responsibility for investment of public funds (California Government Code Section 53600 et seq.). The authority of the legislative body to invest or reinvest funds of a local agency may be delegated for a one-year period by the legislative body to the treasurer of the local agency, who assumes full responsibility until the delegation is revoked or expires; such a delegation may be renewed on an annual basis.

It is common practice for the legislative body to delegate its investment responsibility.

The City Council delegates its investment responsibility and therefore their role as the primary investment officials to the City’s Director of Administrative Services and/or Financial Services Manager annually at the time that the City’s Investment Policy is adopted. This delegation was authorized most recently by City Council adoption of Resolution 2022-107 on June 21, 2022.

Delegation of investment duties does not relieve the primary investment official of their fiduciary responsibilities under California law. Whether an investment official delegates responsibilities to internal staff or to a third pa rty (such as an investment advisor), the investment official is responsible for ensuring that the investment process is managed prudently, professionally, and in accordance with all legal requirements.

The primary investment official must take an active role in the development of investment policies and strategies, ensure that reporting is timely and complete, monitor compliance, credit quality, and performance, and follow -up on any adjustments in strategy necessitated by changes in agency objectives, cash flows, or economic and market conditions. These responsibilities require a considerable commitment of time and effort that includes on -going education by the primary investment official and internal staff that performs these duties.

Role of the Investment Advisor
Investment advisors are professionals with experience, training, and special expertise in the area of investment management. Investment advisors receive a fee for their service. Public agencies

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hire investment advisors that have experience with fixed-income securities (bonds) rather than equities, real estate, or foreign bonds. Public agencies seek advisors that are experienced with the securities authorized by the California Government Code.

Investment advisors with assets under manage ment of $30 million or more are registered with and regulated by the Securities and Exchange Commission (SEC), under the Investment Advisors Act of 1940 (Act). The Act requires investment advisors to file an initial application, known as the “Uniform Application for Investment Advisor Registration” or “Form ADV,” with the SEC. They also must file an annual updating amendment, as well as an amendment any time a significant change has occurred at the firm. The SEC requires investment advisors to maintain ex tensive records, and has the authority to sanction advisors who break the law or rules established under the Act.

There are a number of reasons that a public agency will choose to employ the services of an investment advisor. Some of those reasons are:

 Confidence in the investment advisor’s ability to provide the service professionally and appropriately in a manner that will save the public agency time and safeguard the agency’s funds;
 Potential of greater returns available from full -time expert manag ement of the investment program;
 Increased access to broker offerings;
 City’s lack of resources and expertise to devote to corporate credit review;  City’s lack of market information systems, such as Bloomberg;  City’s lack of adequate staffing capacity and expertise. It is a lower net cost to use the services of an investment advisor rather than hiring additional internal staff to provide the same function.

In addition to the above reasons, there are several advantages to using an investment advisor.

An investment advisor devotes their time almost entirely to investment management activities and monitoring the market, unlike most typical local agency officials who have limited time to de vote to investment activities. This allows local agency officials to focus on long-term investment goals and oversi ght of the investment program. Investment advisors deal with numerous brokers/dealers on a regular basis and have access to real time pricing from multiple broker/dealers at any given time often re ceiving better pricing of securities transactions. Their special training and expertise in the field of investment management provides the local agency clients with s uperior investment strategies. An independent advisor, as compared to a broker/dealer, does not have an inventory of securities to sell. Therefore, certain po tential conflicts of interest (such as selling a security from the firm’s own inventory at a less favorable price than its fair market value) are avoided.

Selection of the Investment Advisory Firm
The City issued a Request for Proposals (RFP) on February 14, 2023 and clo sed the RFP on March 13, 2023. The RFP was advertised in The Star News, the California Society of Municipal Finance Officers website, and the City’s website. A Select ion Committee composed of the City Treasurer, Administrative Director Services, and Financial Analyst formed to evaluate the proposals.

There were a nu mber of factors to consider when evaluating proposals. All evaluation criteria were articulated in th e RFP. Additionally, the RFP disclosed that the Consultants should note that the lowest cost proposal is not the sole determining factor in the final selection. The Evaluation Criteria follows.

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Evaluation Criteria
Proposals will be evaluated using the three (3) sets of criteria below. Consultants which meet the proposal submittal requirements and the mandatory evaluation criteria will be selected for further evaluation by the City. Proposals will be evaluated based upon both understanding of the scope of services to be provided and experience.

1. Mandatory Elements
a. The Consultant is independent and licensed to practice in California. b. The Consultant has no conflict of interest with regards to any of the services to be performed by the Consultant to the City.
c. The Consultant adheres to the instructions in the RFP on preparing and submitting response.

2. Understanding of Scope of Services to be Provided
a. Thoroughness of approach to providing investment management and advisory services to the City.
b. Understanding the City's investment policy requirements and demonstration of investment strategies for carrying out the objectives of the policy. c. Variety of investment options and portfolios available to the City.

3. Experience
a. The quality of the Consult ant's professional personnel to be assigned to the engagement.
b. The Consultant's past and present experience and performance with comparable government agencies.
c. Demonstrated knowledge of market factors and economic indicators and their relationships to investment practices.
d. Understanding of regulatory requirements for investment of public funds.

RFP Results
As a result of the RFP, the City received two proposals for investment management and advisory services from the firms Meeder Public Funds, Inc. and Chandler Asset Management, Inc . The Selection Committee reviewed each of the proposals submitted based on the evaluation criteria listed above. After the review was completed, Chandler Asset Management, Inc. submitted the highest rated proposal and staff recommends authorizing an agreement with Chandler Asset Management for investment services.

About Chandler Asset Management, Inc.

Founded in 1988, Chandler Asset Management is an SEC-registered corporation headquartered in San Diego that specializes in the management of fixed-income portfolios for the public sector.

As of December 31, 2022, Chandler manages over $28.6 billion in firm-wide assets for clients in regions across the United States, including $24.3 billion for 191 public agencies. As a California domiciled firm, Chandler takes enormous pride in the depth and strength of the relationships cultivated in the home state and currently manages over $8.9 billion for 69 cities in California alone. Chandler’s primary focus is public agency fund management and serving clients who are guided by the objectives of preservation of principal, access to cash, and maximization of investment outcome without undue exposure to risk.

Chandler Asset Management has provided investment management and advisory services to the City of National City since 2012. At the May 16, 2023 meeting, the City Council was provided an investment report for the quarter ending December 31, 2022. In that report, Table 2 provides a summary of the City’s Investment Portfolio and market yields to maturity.

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INVESTMENT PORTFOLIO SUMMARY BY MANAGER
As of December 31, 2022

The table shows that Chandler Asset Management has significantly outperformed the County of San Diego pooled cash fund and the State Treasurer’s Local Agency Investment Fund as of December 31, 2022. At the current portfolio distribution and yields reflecte d above (with the portfolio roughly distributed with a third to each investment manager option), Chandler’s performance is yielding the City approximately $580,000 per year more in interest earnings than the earnings generated from the County Pool investments.

FINANCIAL STATEMENT:

There is no additional fiscal impact to the budget because the costs for investment management and advisory services are included in the base budget.

The approximate fees for services are approximately $27,000 per year based upon the current City assets under management by Chandler Asset Management.

RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:

Balanced Budget and Economic Development

ENVIRONMENTAL REVIEW:

This is not a project under CEQA and is therefore not subject to environmental review.CCR15378; PRC 21065.

PUBLIC NOTIFICATION:

Agenda Report posted within 72 hours of meeting date and time in accordance with Brown Act.

ORDINANCE:

Not Applicable

EXHIBITS:

Exhibit A – Agreement and Scope of Services and Fees
Exhibit B – City Council Policy 203
Exhibit C – Resolution

Total Market % of
Manager Book Value Market Value YTM Portfolio
Chandler Asset Management 37,584,716 35,435,984 4.52% 32.48% County of San Diego 36,874,604 35,464,634 2.97% 32.51%
Local Agency Investment Fund 38,713,020 38,203,865 2.17% 35.02% Totals for December 31, 2022 $113,172,340 $109,104,483 100.00%

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AGREEMENT

BY AND BETWEEN

THE CITY OF NATIONAL CITY
AND
CHANDLER ASSET MENAGEMENT, INC.

THIS AGREEMENT is entered into on this 6th day of June, 2023, by and between the CITY OF NATIONAL CITY, a municipal corporation (the “C ITY”), and CHANDLER ASSET MANAGEMENT, INC., a California corporation (the “CONSULTANT”).

R E C I T A L S
WHEREAS, the CITY desires to employ a CONSULTANT to provide investment management and investment advisory services, as outlined in the attached Exhibit “A.” WHEREAS, the CITY has determined that the CONSULTANT is an investment advisor registered with the SEC under the Investment Advisers Act of 1940 and is qualified by experience and ability to perform the s ervices desired by the CITY, and the CONSULTANT is willing to perform such services.

NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS:

1. ENGAGEMENT OF CONSULTANT . The CITY agrees to engage the CONSULTANT to perform investment management and advisory services , and the CONSULTANT agrees to perform the services set forth here in accordance with all terms and conditions contained herein.

The CONSULTANT represents that all services shall be performed directly by the CONSULTANT or under direct supervision of the CONSULTANT.

2. EFFECTIVE DATE AND LENGTH OF AGREEMENT. This Agreement will become effective on July 1, 2023. The duration of this Agreement is for the period of July 1, 2023 through June 30, 2026. Completion dates or time durations for specific portions of the project are set forth in Exhibit “ A”. This Agreement may be extended by mutual agreement upon the same terms and conditions for an additional one (1) year term. The Parties may exercise up to two one- year extensions. Any extension of this Agreement must be approved in writing by the City Council.

3. SCOPE OF SERVICES . The CONSULTANT shall provide investment management and investment advisory services in compliance with the City’s Investment Policy attached hereto as “Exhibit B”. The CONSULTANT shall provide services as set forth in the Exhibit “A”.

The CONSULTANT shall be responsible for all research and reviews related to the work and shall not rely on personnel of the CITY for such services, except as authorized in advance DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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Standard Agreement Page 2 of 12 City of National City and Revised February 2023 Chandler Asset
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by the CITY. The CONSULTANT shall appear at meetings specified in Exhibit “A” to keep staff and City Council advised of the progress on the project.

The CITY may unilaterally, or upon request from the CONSULTANT, from time to time reduce or increase the Scope of Services to be performed by the CONSULTANT under this Agreement. Upon doing so, the CITY and the CONSULTANT agree to meet in good faith and confer for the purpose of negotiating a corresponding reduction or increase in the compensation associated with said change in services.

4. PROJECT COORDINATION AND SUPERVISION. The Director of Administrative Services hereby is designated as the Project Coordinator for the CITY and will monitor the progress and execution of this Agreement. The CONSULTANT shall assign a single Project Director to provide supervision and have overall responsibility for the progress and execution of this Agreement for the CONSULTANT. Mia Corral Brown thereby is designated as the Project Director for the CONSULTANT.

5. COMPENSATION AND PAYMENT . The compensation for the CONSULTANT shall be based on monthly billings covering actual work performed. Billings shall include labor classifications, respective rates, hours worked and also materials, if any. The total cost for all work described in Exhibit “A” shall not exceed the schedule given in Exhibit “A” without prior written authorization from the City. Monthly fees shall be charged in arrears and debited directly from the balance of the CITY’S assets under management by the CONSULTANT, provided that work is accomplished consistent with Exhibit “A,” as determined by the CITY.

The CONSULTANT shall maintain all books, documents, pa pers, employee time sheets, accounting records, and other evidence pertaining to costs incurred, and shall make such materials available at its office at all reasonable times during the term of this Agreement and for three (3) years from the date of final payment under this Agreement, for inspection by the CITY , and for furnishing of copies to the CITY, if requested.

6. ACCEPTABILITY OF WORK . The CITY shall decide any and all questions which may arise as to the quality or acceptability of the services performed and the manner of performance, the acceptable completion of this Agreement, and the amount of compensation due.

In the event the CONSULTANT and the CITY cannot agree to the quality or acceptability of the work, the manner of performance and/or the compensation payable to the CONSULTANT in this Agreement, the CITY or the CONSULTANT shall give to the other written notice. Within ten (10) business days, the CONSULTANT and the CITY shall each prepare a report which supports their position and file the same with the other party. The CITY shall, with reasonable diligence, determine the quality or acceptability of the work, the manner of performance a nd/or the compensation payable to the CONSULTANT.

7. DISPOSITION AND OWNERSHIP OF DOCUMENTS . The Memoranda, Reports, Maps, Drawings, Plans, Specifications , and other documents prepared by the CONSULTANT for this project, whether paper or electronic, shall : (1) be free from defects ; (2) become the property of the CITY for use with respect to this project ; and (3) shall be turned over to the CITY upon completion of the project, or any phase thereof, as contemplated by this Agreement.

DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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Standard Agreement Page 3 of 12 City of National City and Revised February 2023 Chandler Asset
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Contemporaneously with the transfer of documents, the CONSULTANT hereby assigns to the CITY, and CONSULTANT thereby expressly waives and disclaims any copyright in, and the right to reproduce, all written material, drawings, plans, specifications , or other work prepared under this A greement, except upon the CITY’S prior authorization regarding reproduction, which authorization shall not be unreasonably withheld. The CONSULTANT shall, upon request of the CITY, execute any further document(s) necessary to fur ther effectuate this waiver and disclaimer.

The CONSULTANT agrees that the CITY may use, reuse, alter, reproduce, modify, assign, transfer, or in any other way, medium , or method utilize the CONSULTANT’S written work product for the CITY’S purposes, and the CONSULTANT expressly waives and disclaims any residual rights granted to it by Civil Code Sections 980 through 989 relating to intellectual property and artistic works.

Any modification or reuse by the CITY of documents, drawings , or specifications prepared by the CONSULTANT shall relieve the CONSULTANT from liability under Section 14, but only with respect to the effect of the modification or reuse by the CITY, or for any liability to the CITY should the documents be used by the CITY for some project other than what was expressly agreed upon within the Scope of Services of this project, unless otherwise mutually agreed.

8. INDEPENDENT CONTRACTOR. Both parties hereto in the performance of this Agreement will be acting in an independent capacity and not as employees, partners , or joint venturers with one another. However, the Consultant can act as the City’s agent when transacting investment purcha ses or sales on the City’s behalf. Neither the CONSULTANT nor the CONSULTANT’S employees are employees of the CITY, and are not entitled to any of the rights, benefits, or privileges of the CITY’S employees, including but not limited to retirement, medical, unemployment, or workers’ compensation insurance.

This Agreement contemplates the personal services of the CONSULTANT and the CONSULTANT’S employees, and it is recognized by the parties that a substantial inducement to the CITY for entering into this Ag reement was, and is, the professional reputation and competence of the CONSULTANT and its employees. Neither this Agreement, nor any interest herein, may be assigned by the CONSULTANT without the prior written consent of the CITY.

Nothing herein contained is intended to prevent the CONSULTANT from employing or hiring as many employees, or SUBCONSULTANTS, as the CONSULTANT may deem necessary for the proper and efficient performance of th is Agreement. All agreements by CONSULTANT with its SUBCONSULTANT(S) shall require the SUBCONSULTANT (S) to adhere to the applicable terms of this Agreement.

9. CONTROL. Neither the CITY, nor its officers, agents, or employees shall have any control over the conduct of the CONSULTANT or any of the CONSULTANT’S employees, except as set forth in this Agreement. The CONSULTANT, or the CONSULTANT’S agents, servants, or employees are not in any manner servants or employees of the CITY. The CONSULTANT and its agents, servants, and employees are wholly independent from the CITY and CONSULTANT’S obligations to the CITY are solely prescribed by this Agreement.

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Standard Agreement Page 4 of 12 City of National City and Revised February 2023 Chandler Asset
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National City, whether now in force or subsequently enacted. The CONSULTANT and each of its SUBCONSULTANT(S), shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Agreement.

11. LICENSES, PERMITS, ETC . The CONSULTANT represents and covenants that it has all licen ses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession. CONSULTANT must promptly produce a copy of any such license, permit, or approval to CITY upon request. The CONSULTANT represents and covenants that the CONSULTANT shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any license, permit, or approval which is legally required for the CONSULTANT to practice its profession.

12. STANDARD OF CARE.

A. The CONSULTANT, in performing any services under this Agreement, shall perform in a manner consistent with that level of care and skill ordinarily exercised by members of the CONSULTANT’S trade or profession currently practicing under similar conditions and in similar locations. The CONSULTANT shall take all special precautions necessary to protect the CONSULTANT’S employees and members of the public from risk of harm arising out of the nature of the work and/or the conditions of the work site.

B. Unless disclosed in writing prior to the date of this A greement, the CONSULTANT warrants to the CITY that it is not now, nor has it for the five (5) years preceding, been debarred by a governm ental agency or involved in debarment, arbitration or litigation proceedings concerning the CONSULTANT’S professional performance or the furnishing of materials or services relating thereto.

C. The CONSULTANT is responsible for identifying any unique products, treatments, processes or materials whose availability is crit ical to the success of the project the CONSULTANT has been retained to perform, within the time requirements of the CITY, or, when no time is specified, then within a commercially reasonable time. Accordingly, unless the CONSULTANT has notified the CITY otherwise, the CONSULTANT warrants that all products, materials, processes or treatments identified in the project documents prepared for the CITY are reasonably commercially available. Any failure by the CONSULTANT to use due diligence under this sub-section will render the CONSULTANT liable to the CITY for any increased costs that result from the CITY’S later inability to obtain the specified items or any reasonable substitute within a price range that allows for project completion in the time frame specified or, when not specified, then within a commercially reasonable time.

13. NON-DISCRIMINATION PROVISIONS . The CONSULTANT shall not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical h andicap, or medical condition. The CONSULTANT will take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The CONSULTANT agrees to post in conspicuous places available to employees and applicants for employment any notices provided by the CITY setting forth the provisions of this non-discrimination clause.

DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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14. CONFIDENTIAL INFORMATION. The CIT Y may from time to time communicate to the CONSULTANT certain confidential information to enable the CONSULTANT to effectively perform the services to be provided herein. The CONSULTANT shall treat all such information as confidential and shall not disclose any part thereof without the prior written consent of the CITY. The CONSULTANT shall limit the use and circulation of such information, even within its own organization, to the extent necessary to perform the services to be provided herein. The foregoing obligation of this Section 14, however, shall not apply to any part of the information that (i) has been disclosed in publicly available sources of information; (ii) is, through no fault of the CONSULTANT, hereafter disclosed in publicly available sources of information; (iii) is already in the possession of the CONSULTANT without any obligation of confidentiality; or (iv) has been or is hereafter rightfully disclosed to the CONSULTANT by a third party, but only to the extent that the use or disclosure thereof has been or is rightfully authorized by that third party.

The CONSULTANT shall not disclose any reports, recommendations, conclusions or other results of the services or the existence of the subject matter of this Agreement without the prior written consent of the CITY. In its performance hereunder, the CONSULTANT shall comply with all legal obligations it may now or hereafter have respecting the information or other property of any other person, firm or corporation.

CONSULTANT shall be liable to CITY for any damages caused by breach of this condition, pursuant to the provisions of Section 15.

15. INDEMNIFICATION AND HOLD HARMLESS . To the maximum extent provided by law, the CONSULTANT agrees to defend, indemnify and hold harmless the City of National City, its officers, officials, agents, employees, and volunteers against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys’ fees, and defense costs, of any kind or nature, including workers’ compensation claims, of or by anyone whomsoever, resulting from or arising out of the CONSULTANT’S performance or other obligations under this Agreement; provided, however, that this indemnification and hold harmless shall not include any claims or liability arising from the established sole negligence or willful misconduct of the CITY, its agents, officers, employees or volunteers. CITY will cooperate reasonably in the defense of any action, and CONSULTANT shall employ competent counsel, reasonably acceptable to the City Attorney.

The indemnity, defense, and hold harmless obligations contained herein shall survive the termination of this Agreement for any alleged or actual omission, act, or negligence under this Agreement that occurred during the term of this Agreement.

16. EMPLOYEE PAYMENTS AND INDEMNIFICATION.

16.1 PERS Eligibility Indemnification . If CONTRACTOR’s emp loyee(s) providing services under this Agreement claims, or is determined by a court of competent jurisdiction or the California Public Employees Retirement System (“PERS”) to be eligible for enrollment in PERS of the CITY, CONTRACTOR shall indemnify, defend, and hold harmless CITY for the payment of any employer and employee contributions for PERS benefits on behalf of the employee as well as for payment of any penalties and interest on such contributions which would otherwise be the responsibility of the CITY.

DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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CONTRACTOR’S employees providing service under this Agreement shall not:
(1) qualify for any compensation and benefit under PERS; (2) be entitled to any benefits under PERS; (3) enroll in PERS as an employee of CITY; (4) receive any employer contr ibutions paid by CITY for PERS benefits; or (5) be entitled to any other PERS-related benefit that would accrue to a CITY employee. CONTRACTOR’s employees hereby waive any claims to benefits or compensation described in this Section 16. This Section 16 applies to CONTRACTOR notwithstanding any other agency, state or federal policy, rule, regulation, law or ordinance to the contrary.

16.2 Limitation of CITY Liability . The payment made to CONTRACTOR under this Agreement shall be the full and complete compensa tion to which CONTRACTOR and CONTRACTOR’s officers, employees, agents, and subcontractors are entitled for performance of any work under this Agreement. Neither CONTRACTOR nor CONTRACTOR’s officers, employees, agents, and subcontractors are entitled to any salary or wages, or retirement, health, leave or other fringe benefits applicable to CITY employees. The CITY will not make any federal or state tax withholdings on behalf of CONTRACTOR. The CITY shall not be required to pay any workers’ compensation insurance on behalf of CONTRACTOR.

16.3 Indemnification for Employee Payments . CONTRACTOR agrees to defend and indemnify the CITY for any obligation, claim, suit, or demand for tax, retirement contribution including any contribution to PERS, social security, s alary or wages, overtime payment, or workers’ compensation payment which the CITY may be required to make on behalf of (1) CONTRACTOR, (2) any employee of CONTRACTOR, or (3) any employee of CONTRACTOR construed to be an employee of the CITY, for work performed under this Agreement. This is a continuing obligation that survives the termination of this Agreement.

17. WORKERS’ COMPENSATION. The CONSULTANT shall comply with all of the provisions of the Workers’ Compensation Insurance and Safety Acts of the State of California, the applicable provisions of Division 4 and 5 of the California Labor Code and all amendments thereto; and all similar State or federal acts or laws applicable; and shall indemnify, and hold harmless the CITY and its officers, employees , and volunteers from and against all claims, demands, payments, suits, actions, proceedings, and judgments of every nature and descript ion, including reasonable attorney’s fees and defense costs presented, brought or recovered against the CITY or its officers, employees, or volunteers, for or on account of any liability under any of said acts which may be incurred by reason of any work to be performed by the CONSULTANT under this Agreement.

18. INSURANCE. The CONSULTANT, at its sole cost and expense, shall purchase and maintain, and shall require its SUBCONSULTANT(S), when applicable, to purchase and maintain throughout the term of this Agreement, the following insurance policies:

A. If checked, Professional Liability Insurance (errors and omissions) with minimum limits of $1,000,000 per occurrence.

B. Automobile Insurance covering all bodily injury and property damage incurred during the performance of this Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include owned, non -owned, and hired vehicl es. The policy shall name the CITY and its officers, agents , employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided.

DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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C. Commercial General Liability Insurance, with minimum limits of either $2,000,000 per occurrence and $4,000,000 aggregate , or $1,000,000 per occurrence and $2,000,000 aggregate with a $2,000,000 umbrella policy , covering all bodily injury and property damage arising out of its operations, work, or performance under this Agreement. The policy shall name the CITY and its officers, agents, employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided. The general aggregate limit must apply solely to this “project” or “location”. The “project” or “location” should be noted with specificity on an endorsement that shall be incorporated into the policy.

D. Workers’ Compensation Insurance in an amount sufficient to meet statutory requirements cove ring all of CONSULTANT’S employ ees and employer s’ liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of the CITY . Said endorsement shall be provided prior to commencement of work under this Agreement.

If CONSULTANT has no employees subject to the California Workers’ Compensation and Labor laws, CONSULTANT shall execute a Declaration to that effect. Said Declaration shall be provided to CONSULTANT by CITY.

E. The aforesaid policies shall constitute primary insurance as to the CITY, its officers, officials, employees, and volunteers, so that any other policies held by the CITY shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to the CITY ’s Risk Manager, at the address listed in subsection G below, of cancellation or material change.

F. If required insurance coverage is provided on a “claims made” rather than “occurrence” form, the CONSULTANT shall maintain such insurance coverage for three years after expiration of the term (an d any extensions) of this Agree ment. In addition, the “ retro” date must be on or before the date of this Agreement.

G. The Certificate Holder for all policies of insurance required by this Section shall be:

City of National City
c/o Risk Manager
1243 National City Boulevard
National City, CA 91950-4397

H. Insurance shall be written with only insurers authorized to conduct business in California that hold a current policy holder’s alphabetic and financial size category rating of not less than A:VII according to the current Best’s Key Rating Guide, or a company of equal financial stability that is approved by the CITY’S Risk Manager. In the event coverage is provided by non- admitted “surplus lines” carriers, they must be included on the most recent List of Ap proved Surplus Line Insurers (“LASLI”) and otherwise meet rating requirements.

I. This Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by the CITY’S Risk Manager. If the CONSULTANT does not keep all insur ance policies required by this Section 18 in full for ce and effect at all times during the term of this Agreement, the CITY may treat the failure to maintain the requisite insurance as a breach of this Agreement and terminate the Agreement as provided herein.

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J. All deductibles and self -insured retentions in ex cess of $10,000 must be disclosed to and approved by the CITY. CITY reserves the right to modify the insurance requirements of this Section 18, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

K. If the CONSULTANT maintains broader coverage or higher limits (or both) than the minimum limits shown above, the CITY shall be entitled to the broader coverage or higher limits (or both) maintained by the CONSULTANT. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the CITY.

19. LEGAL FEES. If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out-of-court settlement, shall be entitled to have and recover of and from the other party all costs and expenses of suit, including attorneys’ fees.

For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney’s fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. Attorney’s fees to the prevailing party if other than the CITY shall, in addition, be limited to the amount of attorney’s fees incurred by the CITY in its prosecution or defense of the action, irrespective of the actual amount of attorney’s fees incurred by the prevailing party.

20. TERMINATION.

A. This Agreement may be terminated with or without cause by the CITY.

Termination without cause shall be effective only upon 60 -day’s written notice to the CONSULTANT. During said 60- day period the CONSULTANT shall perform all servic es in accordance with this Agreement.

B. This Agreement may also be terminated immediately by the CITY for cause in the event of a material breach of this Agreement, misrepresentation by the CONSULTANT in connection with the formation of this Agreement or the performance of services, or the failure to perform services as directed by the CITY.

C. Termination with or without cause shall be effected by delivery of written Notice of Termination to the CONSULTANT as provided for herein.

D. In the event of termination, all finished or unfinished Memoranda Reports, Maps, Drawings, Plans, Specifications and other documents prepared by the CONSULTANT, whether paper or electronic, shall immediately become the property of and be delivered to the CITY, and the CONSULTANT shall be entitled to receive just and equitable compensation for any work satisfactorily completed on such documents and other materials up to the effective date of the Notice of Termination, not to exceed the amounts payable hereunder, and less any damages caused the CITY by the CONSULTANT’S breach, if any. Thereafter, ownership of said written material shall vest in the CITY all rights set forth in Section 7.

E. The CITY further reserves the right to immediately terminate this Agreement upon: (1) the filing of a petition in bankruptcy affecting the CONSULTANT; (2) a reorganization of the CONSULTANT for the benefit of creditors; or (3) a business reorganization, change in business name or change in business status of the CONSULTANT.

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21. NOTICES. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, re turn receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address i s outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons:

To CITY: Molly Brennan
Director of Administrative Services
Administrative Services
City of National City
1243 National City Boulevard
National City, CA 91950-4397

To CONSULTANT:

Mia Corral Brown
Regional Director
Chandler Asset Management, Inc.
6225 Lusk Boulevard
San Diego, CA 92121
Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section.

22. CONFLICT OF INTEREST AND POLITICAL REFORM ACT
OBLIGATIONS. During the term of this Agreement, the CONSULTANT shall not perform services of any kind for any person or entity whose interests conflict in any way with those of the City of National City . The CONSULTANT also agrees not to specify any product, treatment, process or material for the project in which the CONSULTANT has a material financial interest, either direct or indirect, without first notifying the CITY of that fact. The CONSULTANT shall at all times comply with the terms of the Political Reform Act and the National C ity Conflict of Interest Code. The CONSULTANT shall immediately disqualify itself and shall not use its official position to influence in any way any matter coming before the CITY in which the CONSULTANT has a financial interest as defined in Government Code Section 87103. The CONSULTANT DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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represents that it has no knowledge of any financial interests that would require it to disqualify itself from any matter on which it might perform services for the CITY.

If checked, the CONSULTANT shall comply wi th all of the reporting requirements of the Political Reform Act a nd the National C ity Conflict of Interest Code.

Specifically, the CONSULTANT shall file a Statement of Economic Interests with the City Clerk of the City of National City in a timely manner on forms which the CONSULTANT shall obtain from the City Clerk.

The CONSULTANT shall be strictly liable to the CITY for all damages, costs or expenses the CITY may suffer by virtue of any violation of this Section 22 by the CONSULTANT.

23. PREVAILING WAGES. State prevailing wage rates may apply to work performed under this Agreement. State prevailing wages rates apply to all public works contracts as set forth in California Labor Code, including but not limited to, Sections 1720, 1720.2, 1720.3, 1720.4, and 1771. Consultant is solely responsible to determine if State prevailing wage rates apply and, if applicable, pay such rates in accordance with all laws, ordinances, rules, and regulations.

24. ADMINISTRATIVE PROVISIONS.

A. Computation of Time Periods. If any date or time period provided for in this Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state, or legal holiday.

B. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument.

C. Captions. Any captions to, or headings of, the sections or subsections of this Agreement are solely for the convenience of the parties hereto, are not a part of this Agreement, and shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof.

D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto.

E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. To the extent any exhibits, schedules, or provisions thereof conflict or are inconsiste nt with the terms and conditions contained in this Agreement, the terms and conditions of this Agreement shall control.

F. Amendment to this Agreement. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto.

G. Assignment & Assumption of Rights. CONSULTANT shall not assign this Agreement, in whole or in part, to any other party without first obtaining the written consent of CITY.

H. Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof.

I. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Californi a. The venue for any legal action arising under this Agreement shall be in either state or federal court in the County of San Diego, State of California.

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J. Audit. If this Agreement exceeds ten-thousand dollars ($10,000), the parties shall be subject to t he examination and audit of the State Auditor for a period of three (3) years after final payment under the Agreement, per Government Code Section 8546.7.

K. Entire Agreement. This Agree ment supersedes any prior agree ments, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby.

L. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto.

M. Subcontractors or Subconsultants. The CITY is engaging the services of the CONSULTANT identified in this Agreement. The CONSULTANT shall not subcontract any portion of the work, unless such subcontracting was part of the original proposal or is allowed by the CITY in writing. In the event any portion of the work under this Agreement is subcontracted, the subconsultant(s) shall be required to comply with and agree to, for the benefit of and in favor of the CITY, both the insurance provisions in Section 18 and the indemnification and hold harmless provision of Section 15 of this Agreement.

N. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Agreement, (iv) each party and such party’s counsel and advisors have reviewed this Agreement, (v) each party has agreed to enter into this Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Agreement, or any portions hereof, or any amendments hereto.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first above written.

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CITY OF NATIONAL CITY

By: ____________________________
Ron Morrison, Mayor

APPROVED AS TO FORM:

By: ____________________________
Barry J. Schultz,
City Attorney

CHANDLER ASSET MANAGEMENT, INC.
(Corporation – signatures of two corporate officers required) (Partnership or Sole proprietorship – one signature)

By: _________________
Signature

Nicole Dragoo

Chief Executive Officer

By: _ ________________
(Signature)

Martin Cassell

Chief Financial Officer

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Exhibit “A”
CHANDLER ASSET MANAGEMENT, INC.

SCOPE OF SERVICES

OTHER TERMS AND CONDITIONS

1. Scope of Services . CHANDLER ASSET MANAGEMENT, INC. (“CONSULTANT”) shall provide investment management and investment advisory services for the CITY OF NATIONAL CITY (“CITY”) on all funds authorized by the CITY to be managed by the CONSULTANT. Other servcices to be provided to the CITY by the CONSULTANT include, but are not limited to the following:
a. developing and implementing sound investment strategies which will maximize the portfolio ’s performance within the parameters of the adopted investment policy and California government codes;
b. providing technical and fundamental market research, including yield curve analysis;
c. providing credit analysis of investment instruments in the portfolio; d. providing monthly investment reports for the portfolio detailing holdings, composition and sector analysis, return, weighted average maturity, and daily transaction activity;
e. providing the CITY with on- line access to its current investment account information;
f. providing semi-annual and annual performance reports, as needed; g. reviewing safekeeping and custodial procedures and agreements; h. at a minimum, meeting
with CITY staff on a quarterly basis to review the
investment portfolio and investment performance;
i. at a minimum, delivering semi-annual presentations to the City Council of the City of National City on the performance of the CITY’S portfolio; j. as needed, advising the CITY on recommended changes to its investment policy based upon legislative changes and other relevant market conditions and attending the City Council meeting in which the annual update to the investment policy is presented, if requested by the CITY; k. assisting the CITY in analyzing its cash flow requirements to determine the amount of funds to be invested;
l. assisting the CITY in determining its investment risk tolerance and appropriate portfolio benchmark;
m. providing other services as agreed upon.

2. Fees. The CITY shall compensate the CONSULTANT an amount calculated on the average market value of the CITY ’S assets under managment by the CONSULTANT, including accrued interest, in accordance with the following schedule:

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Assets under Management Annual Asset Management Fee
First $10 million 0.10 of 1% (10 basis points)
Next $30 million 0.08 of 1% (8 basis points)
Assets in excess of $40 million 0.06 of 1% (6 basis points) The fees expressed above do not include custody fees the CITY may incur for third party custodial services.

Fees shall be prorated to the effective date of termination on the basis of actual days elapsed, and any unearned portion of prepaid fees shall be refunded. The CITY is not required to pay any start-up or closing fees; there are not penalty fees.

Fees shall be charged monthly in arrears and debited directly for the CITY’S third party custody account.

3. CITY Representative. In its capacity as investment manager, the CONSULTANT shall receive all instructions, directions, and other communications on the CITY ’S behalf regarding the CITY’S account from the Director of Administrative Services (“Representative”). The CONSULTANT is hereby authorized to rely and act upon all such instructions, directions, and communications from the Representative or any agent designated by the Representative.

4. Investment Policy. In investing and reinvesting the CITY ’S assets, the CONSULTANT shall comply with the CITY’S investment policy attached hereto as “Exhibit 2”

5. Authority of CONSULTANT. The CONSULTANT is hereby granted full discretion to invest and reinvest all assets under its management in any type of security it deems appropriate, subject to the instructions given or guidelines set by the Representative.

6. Electronic Delivery. From time to time, the CONSULTANT may be required to deliver certain documents to the CITY, such as account information, not ices, and required disclosures. The CITY hereby consents to the CONSULTANT’S use of electronic means, such as e- mail, to make such delivery. This delivery may include notification of the availability of such document(s) on a website, and the CITY agrees that such notifications will constitute “delivery.” The CITY further agrees to provide the CONSULTANT with the CITY’S e-mail address(es) and to keep this information current at all times by promptly notifying the CONSULTANT of any change in e-mail address(es).

CITY e-mail addresses: [email protected];
[email protected]

7. Proxy Voting. The CONSULTANT will vote proxies on behalf of the CITY unless otherwise instructed. The CONSULTANT has adopted and implemented written policies and procedures and will provide the CITY with a description of the proxy voting procedures upon request. The CONSULTANT will provide information regarding how the C ITY’S proxies were voted upon request.

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8. Custody of Securities and Funds . The CONSULTANT shall not have custody or possession of the funds or securities that the CITY has placed under its management. The CITY shall appoint a custodian to take and have possession of its assets. The CITY recognizes the importance of comparing statements received from the appointed custodian to statements received from the CONSULTANT. The CITY recognizes that the fees expressed above do not include fees the CITY will incur for custodial services.

9. Valuation. The CONSULTANT will value securities held in portfolios managed by the CONSULTANT no less than monthly. Securities or investments in the portfolio will be valued in a manner determined in good faith by the CONSULTANT to reflect fair market value.

10. Investment Advice. The CITY recognizes that the opinions, recommendations, and actions of the CONSULTANT will be based on information deemed by it to be reliable, but not guaranteed to or by it. Provided that the CONSULTANT acts in good faith, the CITY agrees that the CONSULTANT will not in any way be liable for any error in judgment or for any act or omission, except as may otherwise be provided for under the Federal Securities laws or other applicable laws.

11. Payment of Commissions. The CONSULTANT may place buy and sell or ders with or through such brokers or dealers as it may select. It is the policy and practice of the CONSULTANT to strive for the best price and execution and for commission s and discounts which are competitive in relation to the value of the transaction and which comply with Section 28(e) of the Securities and Exchange Act. Nevertheless, it is understood that the CONSULTANT may pay a commission on transactions in excess of the amount another broker or dealer may charge, and that the CONSULTANT makes no warranty or representation regarding commissions paid on transactions hereunder.

12. Other Clients. It is further understood that the CONSULTANT may be acting in a similar capacity for other institutional and individual clients, and that investments and reinvestments for the CITY’S portfolio may differ from those made or recommended with respect to other accounts and clients, although the investment objectives may be the same or similar. Accordingly, it is agreed that the CONSULTANT will have no obligation to purchase or sell for the CITY ’S account any securities which it may purchase or sell for other clients.

13. Receipt of Bochure and Privacy Policy . Receipt of Brochure and Privacy Policy. The ClTY has received the disclosure statement or “brochure” also known as Part 2A of Form ADV, required to be delivered pursuant to Rule 204- 3 of the Investment Advisers Act of 1940 (Brochure). The CITY has received a copy of the CONSULTANT’S Privacy Policy.

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
I. INTRODUCTION
The City of National City’s investment program will conform to federal, state, and other legal requirements, including California Government Code Sections 16429.1-16429.4, 53600- 53609, and 53630-53686. The following investment policy addresses the methods, procedures, and practices which must be exercised to ensure effective and judicious fiscal and investment management of the City’s funds. It is the policy of the City to invest public funds in a manner that will provide a market rate of return, given its requirements for preserving principal and meeting the daily cash flow demands of the City. All investments will comply with this Investment Policy and governing laws.

This Investment Policy replaces any previous Investment Policy or Investment Procedures of the City.

II. SCOPE
This Investment Policy applies to all the City’s financial assets and investment activities with the following exception(s):

Proceeds of debt issuance shall be invested in accordance with the City’s general investment philosophy as set forth in this policy; however, such proceeds are invested in accordance with permitted investment provisions of their specific bond indentures.

Pooling of Funds: Except for cash in certain restricted and special funds, the City will consolidate cash and reserve balances from all funds to maximize investment earnings and to increase efficiencies with regard to investment pricing, safekeeping and administration.

Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

III. GENERAL OBJECTIVES
The overriding objectives of the investment program are to preserve principal, provide sufficient liquidity, and manage investment risks.

1. Safety: Safety of principal is the foremost objective of the investment program.

Investments will be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. The objective will be to mitigate credit risk and interest rate risk.

2. Liquidity: The investment portfolio will remain sufficiently liquid to meet all operating requirements
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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments

3. Return: The investment portfolio will be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints for safety and liquidity needs.

IV. PRUDENCE, INDEMNIFICATION, AND ETHICS
A. Prudent Investor Standard: Management of the City’s investments is governed by the Prudent Investor Standard as set forth in California Government Code Section 53600.3:
“…all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the City, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the City. Within the limitations of this section and considering individual investments as part of a n overall strategy, investments may be acquired as authorized by law.” B. Indemnification: The Administrative Services Director or City Manager designee hereinafter designated as Financial Services Officer and other authorized persons responsible for managing City funds, acting in accordance with written procedures and the Investment Policy and exercising due diligence, will be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported within 30 days and appropriate action is taken to control adverse developments.

C. Ethics: Officers and employees involved in the investment process will refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions.

V. DELEGATION OF AUTHORITY
A. Authority to manage the City’s investment program is derived from California Government Code Section 53600 et seq. The City Council is responsible for the City’s cash management, including the administration of this Investment Policy. Management responsibility for the cash management of City funds is hereby delegated to the Administrative Services Director and/or Financial Services Officer.

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
The Administrative Services Director or designee will be responsible for all transactions undertaken and will establish a system of procedures and controls to regulate the activities of subordinate employee.

B. The City may engage the services of one or more external investment managers to assist in the management of the City’s investment portfolio in a manner consistent with the City’s objectives. Such external managers may be granted discretion to purchase and sell investment securities in accordance with this Investment Policy. Such managers must be registered under the Investment Advisers Act of 1940.

VI. AUTHORIZED FINANCIAL INSTITUTIONS, DEPOSITORIES, AND BROKER/DEALERS A list will be maintained of financial institutions and depositories authorized to provide investment services. In addition, a list will be maintained of approved security broker/dealers selected by conducting a process of due diligence described in the investment procedures manual. These may include “primary” dealers or regional dealers that qualify under Securities and Exchange Commission (SEC) Rule 15C3-1 (uniform net capital rule).

A. The City’s Administrative Services Director or designee will determine which financial institutions are authorized to provide investment services to the City. Institutions eligible to transact investment business with the City include:

1. Primary government dealers as designated by the Federal Reserve Bank;

2. Nationally or state-chartered banks;

3. The Federal Reserve Bank; and

4. Direct issuers of securities eligible for purchase.

B. Selection of financial institutions and broker/dealers authorized to engage in transactions with the City will be at the sole discretion of the City.

C .All financial institutions which desire to become qualified bidders for investment transactions (and which are not dealing only with the investment adviser) must supply the Administrative Services Director or designee with a statement certifying that the institution has reviewed California Government Code Section 53600 et seq. and the City’s Investment Policy.

D. Selection of broker/dealers used by an external investment adviser retained by the City will be at the sole discretion of the investment adviser.

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
E. Public deposits will be made only in qualified public depositories as established by State law. Deposits will be insured by the Federal Deposit Insurance Corporation, or, to the extent the amount exceeds the insured maximum, will be collateralized in accordance with State law.

VII. DELIVERY, SAFEKEEPING AND CUSTODY, AND COMPETITIVE TRANSACTIONS A. Delivery-versus-payment: Settlement of all investment transactions will be completed using standard delivery-vs.-payment procedures.

B. Third-party safekeeping: To protect against potential losses by collapse of individual securities dealers, and to enhance access to securities, interest payments and maturity proceeds, all securities owned by the City will be held in safekeeping by a third party bank custodian, acting as agent for the City under the terms of a custody agreement executed by the bank and the City.

C. Competitive transactions: All investment transactions will be conducted on a competitive basis which can be executed through a bidding process involving at least three separate brokers/financial institutions or through the use of a nationally recognized trading platform.

VIII. AUTHORIZED AND SUITABLE INVESTMENTS
All investments will be made in accordance with California Government Code Section 53600 et seq. and as described within this Investment Policy. Permitted investments under this policy will include:

1. Municipal Bonds. These include bonds of the City, the State of California, any other municipality, within the state of California. The bonds will be registered in the name of the City or held under a custodial agreement at a bank.
a. Are rated in the category of “A” or better by at least two nationally recognized statistical rating organizations; and
b. No more than 5% per issuer.
c. No more than 30% of the total portfolio may be invested in municipal bonds.

2. US Treasury and other government obligations for which the full faith and credit of the United States are pledged for the payment of principal and interest. There are no limits on the dollar amount or percentage that the City may invest in US Treasuries.

3. Federal Agency or United States government-sponsored enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
principal and interest by federal agencies or United States government-sponsored enterprises. There are no limits on the dollar amount or percentage that the City may invest in government-sponsored enterprises.

4. Banker’s acceptances, provided that:
a. They are issued by institutions with short term debt obligations rated “A1” or higher, or the equivalent, by at least two nationally recognized statistical-rating organizations (NRSRO); and have long-term debt obligations which are rated “A” or higher by at least two nationally recognized statistical rating organizations; b. The maturity does not exceed 180 days; and
c. No more than 40% of the total portfolio may be invested in banker’s acceptances and no more than 5% per issuer.

5. Federally insured time deposits (Non-negotiable certificates of deposit) in state or federally chartered banks, savings and loans, or credit unions, provided that:
a. The amount per institution is limited to the maximum covered under federal insurance; and
b. The maturity of such deposits does not exceed 5 years.

6. Certificate of Deposit Placement Service (CDARS)
a. No more than 30% of the total portfolio may be invested in a combination of certificates of deposit including CDARS
b. The maturity of CDARS deposits does not exceed 5 years.

7. Negotiable certificates of deposit (NCDs), provided that:
a. They are issued by institutions which have long-term obligations which are rated “A” or higher by at least two nationally recognized statistical rating organizations; and/or have short term debt obligations rated “A1” or higher, or the equivalent, by at least two nationally recognized statistical rating organizations; b. The maturity does not exceed 5 years; and
c. No more than 30% of the total portfolio may be invested in NCDs and no more than 5% per issuer.

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments

8. Commercial paper, provided that:
a. The maturity does not exceed 270 days from the date of purchase; b. The issuer is a corporation organized and operating in the United States with assets in excess of $500 million;
c. They are issued by institutions whose short term obligations are rated “A -1” or higher, or the equivalent, by at least two nationally recognized statistical rating organizations; and whose long-term obligations are rated “A” or higher by at least two nationally recognized statistical rating organizations; and d. No more than 25% of the portfolio is invested in commercial paper and no more than 5% per issuer.

9. State of California Local Agency Investment Fund (LAIF), provided that:
a. The City may invest up to the maximum permitted amount in LAIF; and b. LAIF’s investments in instruments prohibited by or not specified in the City’s policy do not exclude it from the City’s list of allowable investments, provide d that the fund’s reports allow the Administrative Services Director or Financial Services Officer or designee to adequately judge the risk inherent in LAIF’s portfolio.

10. Local government investment pools.
a. San Diego County Investment Pool

11. Corporate medium term notes (MTNs), provided that:
a. Such notes have a maximum maturity of 5 years;
b. Are issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States;
c. Are rated “A” category or better by at least two nationally recognized statistical rating organizations; and
d. Holdings of medium-term notes may not exceed 30% of the portfolio and no more than 5% per issuer.

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments

12. Mortgage pass-through securities, asset-backed securities, and collateralized mortgage obligations,[AS1] provided that such securities:
,
a. Have a maximum stated final maturity of 5 years.
b. Be rated in a rating category of “AA” or its equivalent or better by a nationally recognized statistical rating organization.
c. Purchase of securities authorized by this subdivision may not exceed 20% of the portfolio.

13. Money market mutual funds that are registered with the Securities and Exchange Commission under the Investment Company Act of 1940:
a. Provided that such funds meet either of the following criteria:

1. Attained the highest ranking or the highest letter and numerical rating provided by not less than two nationally recognized statistical rating organizations; or,

2. Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience investing in the securities and obligations authorized by California Government Code Section 53601 (a through j) and with assets under management in excess of $500 million.
b. Purchase of securities authorized by this subdivision may not exceed 20% of the portfolio.

14. Supranationals, provided that:
a. Issues are US dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank.
b. The securities are rated in a category of “AA” or higher by a NRSRO. c. No more than 30% of the total portfolio may be invested in these securities. d. No more than 10% of the portfolio may be invested in any single issuer.

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
e. The maximum maturity does not exceed five (5) years.

IX. PORTFOLIO RISK MANAGEMENT
A. The following are prohibited investment vehicles and practices:

1. State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options.

2. In accordance with California Government Code Section 53601.6, investment in inverse floaters, range notes, or mortgage derived interest-only strips is prohibited.

3. Investment in any security that could result in a zero interest accrual if held to maturity is prohibited. Under a provision sunsetting on January 1, 2026, securities backed by the U.S. Government that could result in a zero- or negative-interest accrual if held to maturity are permitted.[AS2]

4. Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited.

5. Purchasing or selling securities on margin is prohibited.

6. The use of reverse repurchase agreements, securities lending or any other form of borrowing or leverage is prohibited.

7. The purchase of foreign currency denominated securities is prohibited.

B. Mitigating credit risk in the portfolio
Credit risk is the risk that a security or a portfolio will lose some or all of its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:

1. The diversification requirements included in Section IX are designed to mitigate credit risk in the portfolio;

2. No more than 5% of the total portfolio may be invested in securities of any single issuer, except as noted in Section VIII of this Investment Policy;

3. The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to improve the quality, liquidity, or yield of the portfolio in response to market conditions or the City’s risk preferences; and DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments

4. If securities owned by the City are downgraded by either Moody’s or S&P to a level below the quality required by this Investment Policy, it will be the City’s policy to review the credit situation and make a determination as to whether to sell or retain such securities in the portfolio.
a. If a security is downgraded, the Administrative Services Director or designee will use discretion in determining whether to sell or hold the security based on its current maturity, the economic outlook for the issuer, and other relevant factors. b. If a decision is made to retain a downgraded security in the portfolio, its presence in the portfolio will be monitored and reported monthly to the City Council.

C. Mitigating market risk in the portfolio
Market risk is the risk that the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. On the other hand, longer-term portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short- term cash needs, and by making longer-term investments only with funds that are not needed for current cash flow purposes. The City further recognizes that certain types of securities, including variable rate securities, securities with principal pay-downs prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk:

1. The City will maintain a minimum of three months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements;

2. The maximum percent of callable securities (does not include “make whole call” securities as defined in the Glossary) in the portfolio will be 20%;

3. The maximum stated final maturity of individual securities in the portfolio will be five years, except as otherwise stated in this policy; and

4. The duration of the portfolio will at all times be approximately equal to the duration (typically plus or minus 20%) of a Market Benchmark Index selected by the City based on the City’s investment objectives, constraints and risk tolerances. The City’s current Benchmark will be documented in the investment procedures manual.

X. INVESTMENT OBJECTIVES (PERFORMANCE STANDARDS AND EVALUATION) DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
A. Overall objective: The investment portfolio will be designed with the overall objective of obtaining a total rate of return throughout economic cycles, commensurate with investment risk constraints and cash flow needs.

B. Specific objective: The investment performance objective for the portfolio will be to earn a total rate of return over a market cycle which is approximately equal to the return on the Market Benchmark Index as described in the City’s investment procedures manual.

XI. PROCEDURES AND INTERNAL CONTROLS
A. Procedures: The Director of Administrative Services or designee will establish written investment policy procedures in a separate investment procedures manual to assist investment staff with day- to-day operations of the investment program consistent with this policy. Such procedures will include explicit delegation of authority to persons responsible for investment transactions. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the Director of Administrative Services or designee.

B. Internal Controls: The Director of Administrative Services or designee is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft, or misuse. The internal control structure will be designed to provide reasonable assurance that these objectives are met. Internal controls will be in the City’s investment procedures manual.

XII. REPORTING AND REVIEW
A. Monthly reports: The Director of Finance and/or Financial Services Officer must submit a monthly report to the legislative body accounting for transactions made during the reporting period.

B. Quarterly reports: Quarterly investment reports will be submitted by the Administrative Services Director or designee to the City Council, at an agendized meeting. Consistent with the requirements contained in California Government Code Section 53646, information in the quarterly investment reports shall include, but not be limited to, the following:

1. Type of investment

2. Name of issuer and/or financial institution

3. Date of purchase

4. Date of maturity

5. Current market value for all securities

6. Rate of interest

7. Purchase price of investment

8. Other data as required by the City
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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
C. Annual Policy review: The Investment Policy will be reviewed at least annually and, as necessary, adopted, to ensure its consistency with the overall objectives of preservation of principal, liquidity, and return, and its relevance to current law and financial and economic trends.

Related Policy References
California Government Code Sections: 16429.1 – 16429.4, and 53600 – 53609 and 53630-53686 Investment Company Act of 1940
Investment Advisers Act of 1940
Securities and Exchange Commission Rule #15C3-1
Appendix I attached: “Authorized Personnel”
Appendix II attached: “Glossary of Investment Terms”
Prior Policy Amendments
October 23, 1990 – Established Policy
May 9, 1995 (Resolution No. 95-62) Updated Policy and Inclusion in the Policy Manual and Amend policy adopted October 23, 1990
August 6, 1996 (Resolution No. 96-130)
August 26, 1997 (Resolution No. 97-110)
October 6, 1998 (Resolution No. 98-136)
September 7, 1999 (Resolution No. 99-130)
October 2, 2001 (Resolution No. 2001-151)
October 1, 2002 (Resolution No. 2002-149)
October 7, 2003 (Resolution No. 2003-139)
June 7, 2005 (Resolution No. 2005-118)
October 4, 2005 (Resolution No. 2005-215)
August 21, 2007 (Resolution No. 2007-202)
February 19, 2008 (Resolution No. 2008-37)
February 19, 2008 (Resolution No. 2008-38) CDC
January 10, 2012 (Resolution No. 2012- 09)
December 10, 2013 (Resolution No. 2013-189)
December 16, 2014 (Resolution No. 2014-172)
December 15, 2015 (Resolution No. 2015-186)
December 6, 2016 (Resolution No. 2016-189)
October 17, 2017 (Resolution No. 2017- 203)
November 20, 2018 (Resolution No. 2018-189)
August 18, 2020 (Resolution No. 2020-151)
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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
Appendix I
Authorized Personnel
The following positions are authorized to transact investment business and wire funds for investment purposes on behalf of the City of National City:

City Manager
Assistant City Manager
Financial Services Officer
Director of Administrative Services or designee
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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
Appendix II

GLOSSARY OF INVESTMENT TERMS
Agencies. Shorthand market terminology for any obligation issued by a government- sponsored entity (GSE), or a federally related institution. Most obligations of GSEs are not guaranteed by the full faith and credit of the US government. Examples are:

FDIC. The Federal Deposit Insurance Corporation provides insurance backed by the full faith and credit of the US government to certain bank deposits and debt obligations.

FFCB. The Federal Farm Credit Bank System provides credit and liquidity in the agricultural industry. FFCB issues discount notes and bonds.

FHLB. The Federal Home Loan Bank provides credit and liquidity in the housing market. FHLB issues discount notes and bonds.

FHLMC. Like FHLB, the Federal Home Loan Mortgage Corporation provides credit and liquidity in the housing market. FHLMC, also called “Freddie Mac” issues discount notes, bonds and mortgage pass-through securities.

FNMA. Like FHLB and Freddie Mac, the Federal National Mortgage Association was established to provide credit and liquidity in the housing market. FNMA, also known as “Fannie Mae,” issues discount notes, bonds and mortgage pass-through securities.

GNMA. The Government Nat ional Mortgage Association, known as “Ginnie Mae,” issues mortgage pass-through securities, which are guaranteed by the full faith and credit of the US Government.

PEFCO. The Private Export Funding Corporation assists exporters. Obligations of PEFCO are not guaranteed by the full faith and credit of the US government.

TVA. The Tennessee Valley Authority provides flood control and power and promotes development in portions of the Tennessee, Ohio and Mississippi River valleys. TVA currently issues discount notes and bonds.

Asked. The price at which a seller offers to sell a security.

Asset-Backed Securities. Securities supported by pools of installment loans or leases or by pools of revolving lines of credit.

Average life. In mortgage-related investments, including CMOs, the average time to expected receipt of principal payments, weighted by the amount of principal expected.

Banker’s acceptance. A money market instrument created to facilitate international trade transactions. It is highly liquid and safe because the risk of the trade transaction is transferred to the bank which “accepts” the obligation to pay the investor.

Benchmark. A comparison security or portfolio. A performance benchmark is a partial market index, which reflects the mix of securities allowed under a specific investment policy.

Bid. The price at which a buyer offers to buy a security.

Broker. A broker brings buyers and sellers together for a transaction for which the broker receives a commission. A broker does not sell securities from his own position.

Callable. A callable security gives the issuer the option to call it from the investor prior to its maturity. The main cause of a call is a decline in interest rates. If interest rates decline since an issuer issues securities, it will likely call its current securities and reissue them at a lower DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
rate of interest. Callable securities have reinvestment risk as the investor may receive its principal back when rates are lower than when the investment was initially made.

Certificate of Deposit (CD). A time deposit with a specific maturity evidenced by a certificate. Large denomination CDs may be marketable.

Collateral. Securities or cash pledged by a borrower to secure repayment of a loan or repurchase agreement. Also, securities pledged by a financial institution to secure deposits of public monies.

Collateralized Mortgage Obligations (CMO). Classes of bonds that redistribute the cash flows of mortgage securities (and whole loans) to create securities that have different levels of prepayment risk, as compared to the underlying mortgage securities.

Commercial paper. The short-term unsecured debt of corporations.

Cost yield. The annual income from an investment divided by the purchase cost. Because it does not give effect to premiums and discounts which may have been included in the purchase cost, it is an incomplete measure of return.

Coupon. The rate of return at which interest is paid on a bond.

Credit risk. The risk that principal and/or interest on an investment will not be paid in a timely manner due to changes in the condition of the issuer.

Current yield. The annual income from an investment divided by the current market value.

Since the mathematical calculation relies on the current market value rather than the investor’s cost, current yi eld is unrelated to the actual return the investor will earn if the security is held to maturity.

Dealer. A dealer acts as a principal in security transactions, selling securities from and buying securities for his own position.

Debenture. A bond secured only by the general credit of the issuer.

Delivery vs. payment (DVP). A securities industry procedure whereby payment for a security must be made at the time the security is delivered to the purchaser’s agent.

Derivative. Any security that has principal and/or interest payments which are subject to uncertainty (but not for reasons of default or credit risk) as to timing and/or amount, or any security which represents a component of another security which has been separated from other components (“Stripped” c oupons and principal). A derivative is also defined as a financial instrument the value of which is totally or partially derived from the value of another instrument, interest rate or index.

Discount. The difference between the par value of a bond and the cost of the bond, when the cost is below par. Some short-term securities, such as T-bills and banker’s acceptances, are known as discount securities. They sell at a discount from par, and return the par value to the investor at maturity without additional interest. Other securities, which have fixed coupons trade at a discount when the coupon rate is lower than the current market rate for securities of that maturity and/or quality.

Diversification. Dividing investment funds among a variety of investments to avoid excessive exposure to any one source of risk.

Duration. The weighted average time to maturity of a bond where the weights are the present values of the future cash flows. Duration measures the price sensitivity of a bond to DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
changes in interest rates. (See modified duration).

Federal funds rate. The rate of interest charged by banks for short-term loans to other banks. The Federal Reserve Bank through open-market operations establishes it.

Federal Open Market Committee: A committee of the Federal Reserve Board that establishes monetary policy and executes it through temporary and permanent changes to the supply of bank reserves.

Haircut: The margin or difference between the actual market value of a security and the value assessed by the lending side of a transaction (i.e. a repo).

Leverage. Borrowing funds in order to invest in securities that have the potential to pay earnings at a rate higher than the cost of borrowing.

Liquidity: The speed and ease with which an asset can be converted to cash.

Local Agency Investment Fund (LAIF). A voluntary investment fund managed by the California State Treasurer’s Office open to government entities and certain non -profit organizations in California.

Local Government Investment Pool. Investment pools including the Local Agency Investment Fund (LAIF), county pools, joint powers authorities (JPAs). These funds are not subject to the same SEC rules applicable to money market mutual funds.

Make Whole Call. A type of call provision on a bond that allows the issuer to pay off the remaining debt early. Unlike a call option, with a make whole call provision, the issuer makes a lump sum payment that equals the net present value (NPV) of future coupon payments that will not be paid because of the call. With this type of call, an investor is compensated, or “made whole.”
Margin: The difference between the market value of a security and the loan a broker makes using that security as collateral.

Market risk. The risk that the value of securities will fluctuate with changes in overall market conditions or interest rates.

Market value. The price at which a security can be traded.

Marking to market. The process of posting current market values for securities in a portfolio.

Maturity. The final date upon which the principal of a security becomes due and payable .

Medium term notes . Unsecured, investment-grade senior debt securities of major corporations which are sold in relatively small amounts either on a continuous or an intermittent basis. MTNs are highly flexible debt instruments that can be structured to respond to market opportunities or to investor preferences.

Modified duration. The percent change in price for a 100 basis point change in yields.

Modified duration is the best single measure of a portfolio’s or security’s exposure to market risk.

Money market. The market in which short term debt instruments (T-bills, discount notes, commercial paper and banker’s acceptances) are issued and traded.

Mortgage pass-through securities. A securitized participation in the interest and principal cash flows from a specified pool of mortgages. Principal and interest payments made on the mortgages are passed through to the holder of the security.

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
Municipal Securities. Securities issued by state and local agencies to finance capital and operating expenses.

Mutual fund. An entity which pools the funds of investors and invests those funds in a set of securities which is specifically defined in the fund’s prospectus. Mutual funds can be invested in various types of domestic and/or international stocks, bonds, and money market instruments, as set forth in the individual fund’s prospectus. For most large, institutional investors, the costs associated with investing in mutual funds are higher than the investor can obtain through an individually managed portfolio.

Nationally Recognized Statistical Rating Organization (NRSRO). A credit rating agency the United States Securities and Exchange Commission uses for regulatory purposes.

Credit rating agencies provide assessments of an investment’s risk. The i ssuers of investments, especially debt securities, pay credit rating agencies to provide them with ratings. The three most prominent NRSROs are Fitch, S&P, and Moody’s.

Premium. The difference between the par value of a bond and the cost of the bond, when the cost is above par.

Prepayment speed. A measure of how quickly principal is repaid to investors in mortgage securities.

Prepayment window. The time period over which principal repayments will be received on mortgage securities at a specified prepayment speed.

Primary dealer. A financial institution (1) that is a trading counterparty with the Federal Reserve in its execution of market operations to carry out US monetary policy, and (2) that participates for statistical reporting purposes in compiling data on activity in the US Government securities market.

Prudent person (man) rule. A standard of responsibility which applies to fiduciaries. In California, the rule is stated as “Investments shall be managed with the care, skill, prudence and diligence, under the circumstances then prevailing, that a prudent person, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of like character and with like aims to accomplish similar purposes.” Realized yield. The change in value of the portfolio due to interest received and interest earned and realized gains and losses. It does not give effect to changes in market value on securities, which have not been sold from the portfolio.

Regional dealer. A financial intermediary that buys and sells securities for the benefit of its customers without maintaining substantial inventories of securities, and that is not a primary dealer.

Repurchase agreement (RP, Repo). Short term purchases of securities with a simultaneous agreement to sell the securities back at a higher price. From the seller’s point of view, the same transaction is a reverse repurchase agreement.

Safekeeping. A service to bank customers whereby securities are held by the bank in the customer’s name.

Short Term. Less than one (1) years’ time.

Structured note. A complex, fixed income instrument, which pays interest, based on a formula tied to other interest rates, commodities or indices. Examples include inverse DocuSign Envelope ID: 97E0E5F7-05B4-42A3-AEF4-8E5C2637431C

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CITY COUNCIL POLICY

CITY OF NATIONAL CITY
AMENDED: June 21, 2022
ADOPTED: October 23, 1990
POLICY #203
TITLE: Investments
floating rate notes which have coupons that increase when other interest rates are falling, and which fall when other interest rates are rising, and “dual index floaters,” which pay interest based on the relationship between two other interest rates - for example, the yield on the ten-year Treasury note minus the Libor rate. Issuers of such notes lock in a reduced cost of borrowing by purchasing interest rate swap agreements.

Supranational. A Supranational is a multi-national organization whereby member states transcend national boundaries or interests to share in the decision making to promote economic development in the member countries.

Total rate of return. A measure of a portfolio’s performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the ending value; it includes interest earnings, realized and unrealized gains, and losses in the portfolio.

US Treasury obligations. Securities issued by the US Treasury and backed by the full faith and credit of the United States. Treasuries are considered to have no credit risk, and are the benchmark for interest rates on all other securities in the US and overseas. The Treasury issues both discounted securities and fixed coupon notes and bonds.

Treasury bills. All securities issued with initial maturities of one year or less are issued as discounted instruments, and are called Treasury bills. The Treasury currently issues three- and six-month T-bills at regular weekly auctions. It also issues “cash management” bills as needed to smooth out cash flows.

Treasury notes. All securities issued with initial maturities of two to ten years are called Treasury notes, and pay interest semi-annually.

Treasury bonds. All securities issued with initial maturities greater than ten years are called Treasury bonds. Like Treasury notes, they pay interest semi-annually.

Value. Principal plus accrued interest.

Volatility. The rate at which security prices change with changes in general economic conditions or the general level of interest rates.

Yield to Maturity. The annualized internal rate of return on an investment which equates the expected cash flows from the investment to its cost.

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RESOLUTION NO. 2023 -

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY ,

CALIFORNIA, AUTHORIZING THE MAYOR TO EXECUTE THE AGREEMENT BY

AND BETWEEN THE CITY OF NATIONAL CITY AND CHANDLER ASSET MANAGEMENT, INC. FOR INVESTMENT MANAGEMENT AND ADVISORY

SERVICES

WHEREAS, on February 14, 2023, the City of National City issued a Request for Proposal (GS2223-1) to provide investment management and advisory services on behalf of the City; and
WHEREAS, the Review Committee determined that Chandl er Asset Management, Inc. submitted the successful proposal; and
WHEREAS, Chandler Asset Management, Inc. will provide the City of National City with investment management and advisory services for a three-year period from July 1, 2023 to June 30, 2026 with the option to extend the agreement for two additional one-year periods ending June 30, 2028.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF NATIONAL CITY,

CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1: That the Cit y Council hereby authorizes the authorizes the Mayor to execute the agreement for a three -year period from July 1, 2023 to June 30, 2026 with the option to extend the agreement for two additional one-year periods ending June 30, 2028.

Section 2: That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.

PASSED and ADOPTED this 20th day of June, 2023.

Ron Morrison, Mayor
ATTEST:

Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:

Barry J. Schultz, City Attorney

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AGENDA REPORT

Department: Administrative Services - Finance
Prepared by: Rachelle Barrera, Finance Manager
Meeting Date: Tuesday, June 20, 2023
Approved by: Armando Vergara, Interim City Manager

SUBJECT:

Agreement between the City of National City and the Pun Group, LLP.

RECOMMENDATION:

BOARD/COMMISSION/COMMITTEE PRIOR ACTION:

Not Applicable.

EXPLANATION:

In anticipation of the expiration of the City of National City’s (City) agreement with The Pun Group, LLP, the City issued a request for proposals (RFP) for Professional Independent Auditing Services on February 17, 2023. The RFP was advertised in The Star News , Union Tribune, California Society of Municipal Finance Officers website and also placed on the City’s website. The proposals were due on March 28, 2023 and the City received two proposals.

A Selection Committee composed of the City Treasurer, Finance Manager, Interim City Manager and Senior Accountant was formed to evaluate the proposals.

There were a number of factors to be considered when evaluating the proposals. All evaluation criteria were articulated in the RFP. Additionally, the RFP disclosed that the Consultants should note that the lowest cost proposal is not the sole determining factor in the final selection. The Evaluation Criteria follows.

Proposals were evaluated using the following criteria:

1. Mandatory Elements:
a. the firm is independent and licensed to practice in the State of California b. the firm has no conflict of interest with regard to any other work performed by the firm for the City;
c. the firm adheres to the instructions in this request for proposal on preparing and submitting the proposal; and
d. the firm has a record of quality audit work, and firm submits a copy of its most recent external quality control review report.

2. Technical Elements:
a. Expertise and Experience
i. the firm's past experience and performance on comparable government engagements with an emphasis on local government experience; ii. the quality of the firm’s professional personnel to be assigned to the engagement and the quality of the firm’s management support personnel to be available for

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technical consultation;
iii. the firm’s ability to assist the City in implementing current and proposed GASB Pronouncements;
iv. the firm’s past experience auditing federal grant programs; v. experience in providing on -going financial consulting services to local governments.

b. Audit Approach
i. adequacy of proposed staffing plan for various segments of the engagement;
ii. adequacy of sampling techniques;
iii. adequacy of analytical procedures.

3. Price:

RFP Results
As a result of the RFP, the City received two proposals for Professional Independent Auditing Services. Proposals were received from The Pun Group, LLP and Badawi & Associates. The Selection Committee reviewed each of the proposals submitted based on the evaluation criteria listed above. After the review was completed, The Pun Group, LLP, submitted the successful proposal.

FINANCIAL STATEMENT:

There is no additional fiscal impact to the budget because the costs for Independent Audit Services are included in the base budget.

The fees for audit services can be found in Exhibit A. The fees for each fiscal year under audit are not-to-exceed amounts:

Fiscal year 2023 $72,000
Fiscal year 2024 $74,160
Fiscal year 2025 $76,386
Fiscal year 2026 $78,376 (optional year)
Fiscal year 2027 $81,037 (optional year)

RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:

Balanced Budget and Economic Development

ENVIRONMENTAL REVIEW:

This is not a project under CEQA and is therefore not subject to environmental review.CCR15378; PRC 21065.

PUBLIC NOTIFICATION:

Agenda Report posted within 72 hours of meeting date and time in accordance with Brown Act.

ORDINANCE:

Not Applicable

EXHIBITS:

Exhibit A – Agreement, Scope of Services and Fees
Exhibit B – Resolution

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AGREEMENT

BY AND BETWEEN

THE CITY OF NATIONAL CITY
AND

THE PUN GROUP, LLP

THIS AGREEMENT is entered into on this 20th day of June, 2023, by and between the CITY OF NATIONAL CITY, a municipal corporation (the “CITY”), and THE PUN GROUP, LLP a Limited Liability Partnership (the “CONSULTANT”).

R E C I T A L S
WHEREAS, the CITY desires to employ a CONSULTANT to provide Professional Independent Audit Services.

WHEREAS, the CITY has determined that the CONSULTANT is a Certified Public Accounting firm and is qualified by experience and ability to perform the services desired by the CITY, and the CONSULTANT is willing to perform such services.

NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS:

1. ENGAGEMENT OF CONSULTANT. The CITY agrees to engage the CONSULTANT to perform professional independent audit serrvices, and the CONSULTANT agrees to perform the services set forth here in accordance with all terms and conditions contained herein and as outlined in the attached Exhibit “A”.

The CONSULTANT represents that all services shall be performed directly by the CONSULTANT or under direct supervision of the CONSULTANT.

2. EFFECTIVE DATE AND LENGTH OF AGREEMENT. This Agreement will become effective on July 1, 2023. The duration of this Agreement is for the period of July 1, 2023 through June 30, 2026. Completion dates or time durations for specific portions of the project are set forth in Exhibit “A”. This Agreement may be extended by mutual agreement upon the same terms and conditions for an additional one (1) year term. The Parties may exercise up to two one- year extensions. Any extension of this Agreement must be approved in writing by the City Council.

3. SCOPE OF SERVICES. The CONSULTANT will perform services as set forth in the attached Exhibit “A”.

The CONSULTANT shall be responsible for all research and reviews related to the work and shall not rely on personnel of the CITY for such services, except as authorized in advance by the CITY. The CONSULTANT shall appear at meetings specified in Exhibit “A” to keep staff and City Council advised of the progress on the project.

The CITY may unilaterally, or upon request from the CONSULTANT, from time to time reduce or increase the Scope of Services to be performed by the CONSULTANT under this Agreement. Upon doing so, the CITY and the CONSULTANT agree to meet in good faith DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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Standard Agreement Page 2 of 12 City of National City and Revised February 2023 The Pun Group, LLP
and confer for the purpose of negotiating a corresponding reduction or increase in the compensation associated with said change in services.

4. PROJECT COORDINATION AND SUPERVISION. Molly Brennan, Director of Administrative Services hereby is designated as the Project Coordinator for the CITY and will monitor the progress and execution of this Agreement. The CONSULTANT shall assign a single Project Director to provide supervision and have overall responsibility for the progress and execution of this Agreement for the CONSULTANT. Kenneth H. Pun thereby is designated as the Project Director for the CONSULTANT.

5. COMPENSATION AND PAYMENT. The compensation for the
CONSULTANT shall be based on monthly billings covering actual work performed. Billings shall include labor classifications, respective rates, hours worked and also materials, if any. The total cost for all work described in Exhibit “A” shall not exceed the rates set forth in Exhibit “A”. The compensation for the CONSULTANT’S work shall not exceed the rates set forth in Exhibit “A”.

Invoices will be processed for payment and remitted within thirty (30) days from receipt of invoice, provided that work is accomplished consistent with Exhibit “A”, as determined by the CITY.

The CONSULTANT shall maintain all books, documents, papers, employee time sheets, accounting records, and other evidence pertaining to costs incurred, and shall make such materials available at its office at all reasonable times during the term of this Agreement and for three (3) years from the date of final payment under this Agreement, for inspection by the CITY, and for furnishing of copies to the CITY, if requested.

6. ACCEPTABILITY OF WORK. The CITY shall decide any and all questions which may arise as to the quality or acceptability of the services performed and the manner of performance, the acceptable completion of this Agreement, and the amount of compensation due.

7. DISPOSITION AND OWNERSHIP OF DOCUMENTS. The Memoranda, Reports, Maps, Drawings, Plans, Specifications, and other documents prepared by the CONSULTANT for this project, whether paper or electronic, shall: (1) be free from defects; (2) become the property of the CITY for use with respect to this project; and (3) shall be turned over to the CITY upon completion of the project, or any phase thereof, as contemplated by this Agreement.

Contemporaneously with the transfer of documents, the CONSULTANT hereby assigns to the CITY, and CONSULTANT thereby expressly waives and disclaims any copyright in, and the right to reproduce, all written material, drawings, plans, specifications, or other work prepared under this Agreement, except upon the CITY’S prior authorization regarding reproduction, which authorization shall not be unreasonably withheld. The CONSULTANT shall, upon request of the CITY, execute any further document(s) necessary to further effectuate this waiver and disclaimer.

DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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The CONSULTANT agrees that the CITY may use, reuse, alter, reproduce, modify, assign, transfer, or in any other way, medium, or method utilize the CONSULTANT’S written work product for the CITY’S purposes, and the CONSULTANT expressly waives and disclaims any residual rights granted to it by Civil Code Sections 980 through 989 relating to intellectual property and artistic works.

Any modification or reuse by the CITY of documents, drawings, or specifications prepared by the CONSULTANT shall relieve the CONSULTANT from liability under Section 14, but only with respect to the effect of the modification or reuse by the CITY, or for any liability to the CITY should the documents be used by the CITY for some project other than what was expressly agreed upon within the Scope of Services of this project, unless otherwise mutually agreed.

8. INDEPENDENT CONTRACTOR. Both parties hereto in the performance of this Agreement will be acting in an independent capacity and not as agents, employees, partners, or joint venturers with one another. Neither the CONSULTANT nor the CONSULTANT’S employees are employees of the CITY, and are not entitled to any of the rights, benefits, or privileges of the CITY’S employees, including but not limited to retirement, medical, unemploy- ment, or workers’ compensation insurance.

This Agreement contemplates the personal services of the CONSULTANT and the CONSULTANT’S employees, and it is recognized by the parties that a substantial inducement to the CITY for entering into this Agreement was, and is, the professional reputation and competence of the CONSULTANT and its employees. Neither this Agreement, nor any interest herein, may be assigned by the CONSULTANT without the prior written consent of the CITY.

Nothing herein contained is intended to prevent the CONSULTANT from employing or hiring as many employees, or SUBCONSULTANTS, as the CONSULTANT may deem necessary for the proper and efficient performance of this Agreement. All agreements by CONSULTANT with its SUBCONSULTANT(S) shall require the SUBCONSULTANT(S) to adhere to the applicable terms of this Agreement.

9. CONTROL. Neither the CITY, nor its officers, agents, or employees shall have any control over the conduct of the CONSULTANT or any of the CONSULTANT’S employees, except as set forth in this Agreement. The CONSULTANT, or the CONSULTANT’S agents, servants, or employees are not in any manner agents, servants, or employees of the CITY. The CONSULTANT and its agents, servants, and employees are wholly independent from the CITY and CONSULTANT’S obligations to the CITY are solely prescribed by this Agreement.

10. COMPLIANCE WITH APPLICABLE LAW. The CONSULTANT, in the performance of the services to be provided herein, shall comply with all applicable state and federal statutes and regulations, and all applicable ordinances, rules, and regulations of the City of National City, whether now in force or subsequently enacted. The CONSULTANT and each of its SUBCONSULTANT(S), shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Agreement.

11. LICENSES, PERMITS, ETC. The CONSULTANT represents and covenants that it has all licenses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession. CONSULTANT must promptly produce a copy of any such license, permit, or approval to CITY upon request. The CONSULTANT represents and covenants DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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that the CONSULTANT shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any license, permit, or approval which is legally required for the CONSULTANT to practice its profession.

12. STANDARD OF CARE.

B. Unless disclosed in writing prior to the date of this Agreement, the CONSULTANT warrants to the CITY that it is not now, nor has it for the five (5) years preceding, been debarred by a governmental agency or involved in debarment, arbitration or litigation proceedings concerning the CONSULTANT’S professional performance or the furnishing of materials or services relating thereto.

C. The CONSULTANT is responsible for identifying any unique products, treatments, processes or materials whose availability is critical to the success of the project the CONSULTANT has been retained to perform, within the time requirements of the CITY, or, when no time is specified, then within a commercially reasonable time. Accordingly, unless the CONSULTANT has notified the CITY otherwise, the CONSULTANT warrants that all products, materials, processes or treatments identified in the project documents prepared for the CITY are reasonably commercially available. Any failure by the CONSULTANT to use due diligence under this sub-section will render the CONSULTANT liable to the CITY for any increased costs that result from the CITY’S later inability to obtain the specified items or any reasonable substitute within a price range that allows for project completion in the time frame specified or, when not specified, then within a commercially reasonable time.

13. NON-DISCRIMINATION PROVISIONS. The CONSULTANT shall not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. The CONSULTANT will take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The CONSULTANT agrees to post in conspicuous places available to employees and applicants for employment any notices provided by the CITY setting forth the provisions of this non-discrimination clause.

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part of the information that (i) has been disclosed in publicly available sources of information; (ii) is, through no fault of the CONSULTANT, hereafter disclosed in publicly available sources of information; (iii) is already in the possession of the CONSULTANT without any obligation of confidentiality; or (iv) has been or is hereafter rightfully disclosed to the CONSULTANT by a third party, but only to the extent that the use or disclosure thereof has been or is rightfully authorized by that third party.

CONSULTANT shall be liable to CITY for any damages caused by breach of this condition, pursuant to the provisions of Section 15.

15. INDEMNIFICATION AND HOLD HARMLESS. To the maximum extent provided by law, The CONSULTANT agrees to defend, indemnify and hold harmless the City of National City, its officers, officials, agents, employees, and volunteers against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys’ fees, and defense costs, of any kind or nature, including workers’ compensation claims, of or by anyone whomsoever, resulting from or arising out of the CONSULTANT’S performance or other obligations under this Agreement; provided, however, that this indemnification and hold harmless shall not include any claims or liability arising from the established sole negligence or willful misconduct of the CITY, its agents, officers, employees or volunteers. CITY will cooperate reasonably in the defense of any action, and CONSULTANT shall employ competent counsel, reasonably acceptable to the City Attorney.

16. EMPLOYEE PAYMENTS AND INDEMNIFICATION.

16.1 PERS Eligibility Indemnification. If CONTRACTOR’s employee(s) providing services under this Agreement claims, or is determined by a court of competent jurisdiction or the California Public Employees Retirement System (“PERS”) to be eligible for enrollment in PERS of the CITY, CONTRACTOR shall indemnify, defend, and hold harmless CITY for the payment of any employer and employee contributions for PERS benefits on behalf of the employee as well as for payment of any penalties and interest on such contributions which would otherwise be the responsibility of the CITY.

CONTRACTOR’S employees providing service under this Agreement shall not:
(1) qualify for any compensation and benefit under PERS; (2) be entitled to any benefits under PERS; (3) enroll in PERS as an employee of CITY; (4) receive any employer contributions paid by CITY for PERS benefits; or (5) be entitled to any other PERS-related benefit that would accrue to a CITY employee. CONTRACTOR’s employees hereby waive any claims to benefits or compensation described in this Section 16. This Section 16 applies to CONTRACTOR notwithstanding any other agency, state or federal policy, rule, regulation, law or ordinance to the contrary.

DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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16.2 Limitation of CITY Liability. The payment made to CONTRACTOR under this Agreement shall be the full and complete compensation to which CONTRACTOR and CONTRACTOR’s officers, employees, agents, and subcontractors are entitled for performance of any work under this Agreement. Neither CONTRACTOR nor CONTRACTOR’s officers, employees, agents, and subcontractors are entitled to any salary or wages, or retirement, health, leave or other fringe benefits applicable to CITY employees. The CITY will not make any federal or state tax withholdings on behalf of CONTRACTOR. The CITY shall not be required to pay any workers’ compensation insurance on behalf of CONTRACTOR.

16.3 Indemnification for Employee Payments. CONTRACTOR agrees to defend and indemnify the CITY for any obligation, claim, suit, or demand for tax, retirement contribution including any contribution to PERS, social security, salary or wages, overtime payment, or workers’ compensation payment which the CITY may be required to make on behalf of (1) CONTRACTOR, (2) any employee of CONTRACTOR, or (3) any employee of CONTRACTOR construed to be an employee of the CITY, for work performed under this Agreement. This is a continuing obligation that survives the termination of this Agreement.

17. WORKERS’ COMPENSATION. The CONSULTANT shall comply with all of the provisions of the Workers’ Compensation Insurance and Safety Acts of the State of California, the applicable provisions of Division 4 and 5 of the California Labor Code and all amendments thereto; and all similar State or federal acts or laws applicable; and shall indemnify, and hold harmless the CITY and its officers, employees, and volunteers from and against all claims, demands, payments, suits, actions, proceedings, and judgments of every nature and description, including reasonable attorney’s fees and defense costs presented, brought or recovered against the CITY or its officers, employees, or volunteers, for or on account of any liability under any of said acts which may be incurred by reason of any work to be performed by the CONSULTANT under this Agreement.

A. If checked, Professional Liability Insurance (errors and omissions) with minimum limits of $1,000,000 per occurrence.

B. Automobile Insurance covering all bodily injury and property damage incurred during the performance of this Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include owned, non-owned, and hired vehicles. The policy shall name the CITY and its officers, agents, employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided.

C. Commercial General Liability Insurance, with minimum limits of either $2,000,000 per occurrence and $4,000,000 aggregate, or $1,000,000 per occurrence and $2,000,000 aggregate with a $2,000,000 umbrella policy, covering all bodily injury and property damage arising out of its operations, work, or performance under this Agreement. The policy shall name the CITY and its officers, agents, employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided. The general aggregate limit must apply solely to this “project” or “location”. The “project” or “location” should be noted with specificity on an endorsement that shall be incorporated into the policy.

DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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D. Workers’ Compensation Insurance in an amount sufficient to meet statutory requirements covering all of CONSULTANT’S employees and employers’ liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of the CITY. Said endorsement shall be provided prior to commencement of work under this Agreement.

E. The aforesaid policies shall constitute primary insurance as to the CITY, its officers, officials, employees, and volunteers, so that any other policies held by the CITY shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to the CITY’s Risk Manager, at the address listed in subsection G below, of cancellation or material change.

F. If required insurance coverage is provided on a “claims made” rather than “occurrence” form, the CONSULTANT shall maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Agreement. In addition, the “retro” date must be on or before the date of this Agreement.

G. The Certificate Holder for all policies of insurance required by this Section shall be:

City of National City
c/o Risk Manager
1243 National City Boulevard
National City, CA 91950-4397

H. Insurance shall be written with only insurers authorized to conduct business in California that hold a current policy holder’s alphabetic and financial size category rating of not less than A:VII according to the current Best’s Key Rating Guide, or a company of equal financial stability that is approved by the CITY’S Risk Manager. In the event coverage is provided by non- admitted “surplus lines” carriers, they must be included on the most recent List of Approved Surplus Line Insurers (“LASLI”) and otherwise meet rating requirements.

I. This Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by the CITY’S Risk Manager. If the CONSULTANT does not keep all insurance policies required by this Section 18 in full force and effect at all times during the term of this Agreement, the CITY may treat the failure to maintain the requisite insurance as a breach of this Agreement and terminate the Agreement as provided herein.

J. All deductibles and self-insured retentions in excess of $10,000 must be disclosed to and approved by the CITY. CITY reserves the right to modify the insurance requirements of this Section 18, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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20. TERMINATION.

A. This Agreement may be terminated with or without cause by the CITY.

Termination without cause shall be effective only upon 60-day’s written notice to the CONSULTANT. During said 60-day period the CONSULTANT shall perform all services in accordance with this Agreement.

C. Termination with or without cause shall be effected by delivery of written Notice of Termination to the CONSULTANT as provided for herein.

21. NOTICES. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons:

To CITY: Molly Brennan
Director of Administrative Services
City of National City
1243 National City Boulevard
National City, CA 91950-4397

To CONSULTANT:

Kenneth H. Pun, CPA, CGMA
Managing Partner
The Pun Group, LLP
4660 La Jolla Village Dr, Suite 100
San Diego, CA 92122
Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section.

22. CONFLICT OF INTEREST AND POLITICAL REFORM ACT
OBLIGATIONS. During the term of this Agreement, the CONSULTANT shall not perform services of any kind for any person or entity whose interests conflict in any way with those of the City of National City. The CONSULTANT also agrees not to specify any product, treatment, process or material for the project in which the CONSULTANT has a material financial interest, either direct or indirect, without first notifying the CITY of that fact. The CONSULTANT shall at all times comply with the terms of the Political Reform Act and the National City Conflict of Interest Code. The CONSULTANT shall immediately disqualify itself and shall not use its official position to influence in any way any matter coming before the CITY in which the CONSULTANT has a financial interest as defined in Government Code Section 87103. The CONSULTANT represents that it has no knowledge of any financial interests that would require it to disqualify itself from any matter on which it might perform services for the CITY.

If checked, the CONSULTANT shall comply with all of the reporting requirements of the Political Reform Act and the National City Conflict of Interest Code.

The CONSULTANT shall be strictly liable to the CITY for all damages, costs or expenses the CITY may suffer by virtue of any violation of this Section 22 by the CONSULTANT.

23. PREVAILING WAGES. State prevailing wage rates may apply to work performed under this Agreement. State prevailing wages rates apply to all public works contracts DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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as set forth in California Labor Code, including but not limited to, Sections 1720, 1720.2, 1720.3, 1720.4, and 1771. Consultant is solely responsible to determine if State prevailing wage rates apply and, if applicable, pay such rates in accordance with all laws, ordinances, rules, and regulations.

24. ADMINISTRATIVE PROVISIONS.

B. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument.

E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. To the extent any exhibits, schedules, or provisions thereof conflict or are inconsistent with the terms and conditions contained in this Agreement, the terms and conditions of this Agreement shall control.

F. Amendment to this Agreement. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto.

G. Assignment & Assumption of Rights. CONSULTANT shall not assign this Agreement, in whole or in part, to any other party without first obtaining the written consent of CITY.

H. Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof.

I. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. The venue for any legal action arising under this Agreement shall be in either state or federal court in the County of San Diego, State of California.

J. Audit. If this Agreement exceeds ten-thousand dollars ($10,000), the parties shall be subject to the examination and audit of the State Auditor for a period of three (3) years after final payment under the Agreement, per Government Code Section 8546.7.

K. Entire Agreement. This Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby.

L. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto.

M. Subcontractors or Subconsultants. The CITY is engaging the services of the CONSULTANT identified in this Agreement. The CONSULTANT shall not subcontract any DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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portion of the work, unless such subcontracting was part of the original proposal or is allowed by the CITY in writing. In the event any portion of the work under this Agreement is subcontracted, the subconsultant(s) shall be required to comply with and agree to, for the benefit of and in favor of the CITY, both the insurance provisions in Section 18 and the indemnification and hold harmless provision of Section 15 of this Agreement.

DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first above written.

CITY OF NATIONAL CITY

By: ____________________________
Ron Morrison, Mayor

APPROVED AS TO FORM:

By: ____________________________
Barry J. Schultz,
City Attorney

THE PUN GROUP, LLP
(Corporation – signatures of two corporate officers required) (Partnership or Sole proprietorship – one signature)

By: ______________________________
(Name)

Kenneth H. Pun
(Print)

Managing Partner
(Title)

By: ______________________________
(Name)

______________________________
(Print)

______________________________
(Title)

DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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Exhibit A

Scope of Services

The Consultant will be required to perform the following tasks:

1. Audit of all funds of the City in accordance with the United States Government Accountability Office’s Generally Accepted Government Auditing Standards;

2. Preparation, including word processing, of the City’s CAFR and the financial statements of its component units in compliance with applicable GASB statements;

3. Gann limit review pertaining to the City’s appropriation limit, rendering a letter annually regarding compliance;

4. City-wide audit of the expenditures of federal grants in accordance with Uniform Guidance and preparation of the appropriate reports, testing two (2) major programs, including the Housing Choice Voucher Program (“HCVP”);

5. Financial and compliance audits of the Regional Solid Waste Association (RSWA), a Joint Powers Authority;

6. Commission single audit of federal grants allocable to HCVP in accordance with Uniform Guidance; and

7. Real Estate Assessment Center electronic submission to HUD and related attestations.

Additional Services:

8. Compile the Annual State Controller’s Report for the City; and

9. Serve as a resource and provide training to professional accounting staff on preparation of financial statements and best practices in conformance with applicable laws and governmental accounting standards.

Auditing Standards to be followed:

The Consultant shall review the financial records and all the various funds of the City and prepare all the financial statements in conformance with:

10. Generally accepted auditing standards as set forth by the American Institute of Certified Public Accountants (AICPA);

11. The standards applicable to financial audits contained in Government Auditing Standards (2011 revision) issued by the Comptroller General of the United States;

12. The provisions of the Single Audit Act of 1996 and the provisions of Uniform Guidance; and

13. All applicable GASB statements.

Reports to be Issued:

Following the completion of the audit of the fiscal year's financial statements, the Consultant shall issue:

14. A report on the fair presentation of the financial statements in conformity with generally accepted accounting principles for all entities listed above;

15. A report on compliance and on the internal control over financial reporting based on an audit of financial statements performed in accordance with Government Auditing Standards;

16. A report on compliance with requirements applicable to each major program and internal control over compliance in accordance with Uniform Guidance (Single Audit); DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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Exhibit A
(CONTINUED)

17. A schedule of Expenditures of Federal Awards together with applicable notes to this schedule (Single Audit);

18. A schedule of findings and questioned costs (Single Audit);

19. Status of prior year findings (Single Audit); and

20. Form SF-SAC, Data Collections Form for Reporting of Audits of States, Local Governments and Non-Profit Organizations.

DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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Exhibit A
(CONTINUED)

Fee Schedule

Services FY 2023 FY 2024 FY 2025 FY 2026¹ FY 2027¹City Audit, including ACFR 55,000 56,650 58,350 60,100 61,903 Single Audit - 2 Major Programs 8,500 8,755 9,018 9,288 9,567 GANN Limit Included Included Included Included IncludedAnnual State Controller's Report 4,500 4,635 4,774 4,917 5,065 Financial and compliance audits of the Regional Solid Waste Association (RSWA)4,000 4,120 4,244 4,371 4,502 Commission Single Audit of Federal Grants Allocable to Housing Choice Voucher ProgramIncluded Included Included Included IncludedREAC Electronic Submission to HUD and Related AttestationsIncluded Included Included Included IncludedTotal for Fiscal Year (not-to-exceed)72,000 74,160 76,386 78,676 81,037 Compensation and Payments

Auditors Standard Billing Rates (per hour)Position FY 2023 FY 2024 FY 2025 FY 2026¹ FY 2027¹Partners 300 309 318 328 338Directors 200 206 212 219 225Supervisor 175 180 186 191 197Senior Accountants 150 155 159 164 169Staff Accountants 125 129 133 137 141Clerical 100 103 106 109 113 DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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Exhibit A
(CONTINUED)

Invoice Payments²Work Performed% of Proposal AmountPlanning 10%Interim Work 40%Fieldwork 40%Presentation and Acceptance of Reports10%Total100%¹ The City has the option to extend the agreement under the same terms and conditions for year 4 and year 5.² Invoices w ill cover a period at least one calendar month. The invoices w ill be charge for w ork performed based on the percentage of the proposal amount as show n above.

DocuSign Envelope ID: 882EBCFA-2C4D-41F4-93CB-51EFBD4DA0C7

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RESOLUTION NO. 2023 -

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY , CALIFORNIA,

AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT WITH THE PUN GROUP, LLP

FOR PROFESSIONAL INDEPENDENT AUDIT SERVICES

WHEREAS, on February 17, 2023, the City of National City issued a Request for Proposal to provide professional independent audit services for the City; and WHEREAS, the Review Committee determined that The Pun Group, LLP submitted the successful proposal; and
WHEREAS, The Pun Group, LLP will provide the City of National City with professional independent audit services for a three -year period from July 1, 2023 to June 30, 2026 with the option to extend the agreement for two additional one-year periods ending June 30, 2028.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1: That the City Council hereby authorizes the Mayor to execute the agreement for a three-year period from July 1, 2023 to June 30, 2026 with the option to extend the agreement for two additional one-year periods ending June 30, 2028.

Section 2: That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.

PASSED and ADOPTED this 20th day of June, 2023.

Ron Morrison, Mayor

ATTEST:

Shelley Chapel, MMC, City Clerk

APPROVED AS TO FORM:

Barry J. Schultz, City Attorney

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AGENDA REPORT

Department: Administrative Services - Human Resources Prepared by: Molly Brennan, Administrative Services Director Meeting Date: Tuesday, June 20, 2023
Approved by: Armando Vergara, Interim City Manager

SUBJECT:

Amending the Confidential Group Salary Schedule to Revise the Salary of the Senior Information Technology Analyst for 2023 and 2024.

RECOMMENDATION:

Adopt the Resolution Entitled, “Resolution of the City Council of the City of National City, California, Amending the Confidential Group Salary Schedule.”

BOARD/COMMISSION/COMMITTEE PRIOR ACTION:

Not Applicable.

EXPLANATION:

On February 1, 2022, the City Council authorized 3% cost of living adjustments (COLAs) for all Confidential Group employee salaries, to be effective the first full pay period of January 2023 and January 2024, by amending the Confidential Group salary schedule.

The following month, i n March 2022 , the City Council approved the creation of a new classification, Senior Information Technology Analyst. At that time, the City Council authorized adding the new position to the Confidential Group and set a salary for 2022. However due to oversight, the March 2022 City Council action did not include authorization for the new classification of Senior Information Technology Analyst to receive the future 3% COLA in January 2023 and January 2024. The employee in this position has not received the 3% COLA for 2023 because it has not been authorized. Staff recommends approval of the resolution to correct the oversight and to authorize the Senior Information Technology Analyst to receive a 3% COLA retroactively back to January 2023 and a 3% COLA in January 2024, to mirror the COLA wage increases all other Confidential Group classifications received.

Exhibit A is the Confidential Group Salary Schedule, with the Senior Information Technology Analyst position’s current salary reflected on the first page (2022) and the proposed 3% increases highlighted on the following two pages.

FINANCIAL STATEMENT:

The fiscal year 2023 budget and preliminary fiscal year 2024 budget already include personnel service appropriations to cover the 3% wage increase for the position. No additional appropriations are necessary.

RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:

Not Applicable

ENVIRONMENTAL REVIEW:

This is not a project under CEQA and is therefore not subject to environmental review.CCR15378; PRC 21065.

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PUBLIC NOTIFICATION:

Agenda Report posted within 72 hours of meeting date and time in accordance with Brown Act.

ORDINANCE:

Not Applicable

EXHIBITS:

Exhibit A – Proposed Confidential Group Salary Schedule 2023-2024 Exhibit B - Resolution

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CITY OF NATIONAL CITY

CONFIDENTIAL SALARY SCHEDULE
EFFECTIVE DATE 2/08/2022
3% Increase + Equity Adjustment

TITLE STEP A STEP B STEP C STEP D STEP E
Senior Information Technology Analyst
BI-WEEKLY 3,440.57 3,612.60 3,793.23 3,982.89 4,182.03 MONTHLY 7,454.57 7,827.30 8,218.67 8,629.60 9,061.07 ANNUAL 89,454.82 93,927.60 98,623.98 103,555.14 108,732.78 HOURLY 43.01 45.16 47.42 49.79 52.28 Information Technology Analyst
BI-WEEKLY 2,991.80 3,141.40 3,298.47 3,463.39 3,636.56 MONTHLY 6,482.23 6,806.36 7,146.68 7,504.00 7,879.21 ANNUAL 77,786.79 81,676.33 85,760.11 90,048.03 94,550.53 HOURLY 37.40 39.27 41.23 43.29 45.46 Information Technology Technician
BI-WEEKLY 2,567.84 2,696.23 2,831.04 2,972.60 3,121.23 MONTHLY 5,563.66 5,841.84 6,133.93 6,440.63 6,762.67 ANNUAL 66,763.96 70,102.11 73,607.13 77,287.58 81,152.02 HOURLY 32.10 33.70 35.39 37.16 39.02 Executive Assistant IV
BI-WEEKLY 2,372.93 2,491.59 2,616.16 2,746.97 2,884.31 MONTHLY 5,141.35 5,398.44 5,668.34 5,951.76 6,249.34 ANNUAL 61,696.23 64,781.23 68,020.06 71,421.16 74,992.11 HOURLY 29.66 31.14 32.70

34.34 36.05
Executive Assistant III
BI-WEEKLY 2,247.70 2,360.08 2,478.09 2,602.00 2,732.10 MONTHLY 4,870.02 5,113.51 5,369.19 5,637.67 5,919.55 ANNUAL 58,440.27 61,362.16 64,430.31 67,652.02 71,034.59 HOURLY 28.10 29.50 30.98 32.53 34.15 Executive Assistant II
BI-WEEKLY 2,090.06 2,194.56 2,304.28 2,419.50 2,540.48 MONTHLY 4,528.46 4,754.87 4,992.61 5,242.25 5,504.37 ANNUAL 54,341.54 57,058.49 59,911.32 62,907.04 66,052.39 HOURLY 26.13 27.43 28.80 30.24 31.76 Payroll Technician II
BI-WEEKLY 1,957.47 2,055.35 2,158.11 2,266.02 2,379.33 MONTHLY 4,241.19 4,453.25 4,675.91 4,909.71 5,155.21 ANNUAL 50,894.25 53,439.01 56,110.93 58,916.58 61,862.51 HOURLY 24.47 25.69 26.98 28.33 29.74 Confidential Assistant (At-Will)
BI-WEEKLY 1,919.23 2,015.19 2,115.95 2,221.75 2,332.84 MONTHLY 4,158.33 4,366.25 4,584.56 4,813.80 5,054.50 ANNUAL 49,899.98 52,395.02 55,014.75 57,765.58 60,653.96 HOURLY 23.99 25.19 26.45 27.77 29.16 Executive Assistant I
BI-WEEKLY 1,842.98 1,935.13 2,031.88 2,133.48 2,240.16 MONTHLY 3,993.12 4,192.77 4,402.41 4,622.53 4,853.67 ANNUAL 47,917.49 50,313.28 52,828.94 55,470.38 58,244.04 HOURLY 23.04 24.19 25.40 26.67 28.00 Payroll Technician I
BI-WEEKLY 1,779.53 1,868.50 1,961.92 2,060.03 2,163.01 MONTHLY 3,855.65 4,048.42 4,250.83 4,463.40 4,686.53 ANNUAL 46,267.79 48,581.02 51,010.01 53,560.76 56,238.38 HOURLY 22.24 23.36 24.52 25.75 27.04

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CITY OF NATIONAL CITY

CONFIDENTIAL SALARY SCHEDULE
EFFECTIVE DATE JANUARY 2023
3% Increase + Equity Adjustment

TITLE STEP A STEP B STEP C STEP D STEP E
Senior Information Technology Analyst
BI-WEEKLY 3,543.79 3,720.98 3,907.03 4,102.38 4,307.49 MONTHLY 7,678.21 8,062.12 8,465.22 8,888.48 9,332.90 ANNUAL 92,138.46 96,745.43 101,582.70 106,661.79 111,994.76 HOURLY 44.30 46.51 48.84 51.28 53.84 Information Technology Analyst
BI-WEEKLY 3,154.25 3,311.97 3,477.57 3,651.45 3,834.02 MONTHLY 6,834.22 7,175.95 7,534.74 7,911.47 8,307.05 ANNUAL 82,010.61 86,111.35 90,416.89 94,937.64 99,684.63 HOURLY 39.43 41.40 43.47 45.64 47.93 Information Technology Technician
BI-WEEKLY 2,644.88 2,777.12 2,915.97 3,061.78 3,214.87 MONTHLY 5,730.57 6,017.10 6,317.95 6,633.85 6,965.55 ANNUAL 68,766.88 72,205.17 75,815.34 79,606.21 83,586.58 HOURLY 33.06 34.71 36.45 38.27 40.19 Executive Assistant IV
BI-WEEKLY 2,487.54 2,611.93 2,742.52 2,879.65 3,023.62 MONTHLY 5,389.68 5,659.18 5,942.12 6,239.23 6,551.19 ANNUAL 64,676.16 67,910.16 71,305.43 74,870.81 78,614.23 HOURLY 31.09 32.65 34.28

36.00 37.80
Executive Assistant III
BI-WEEKLY 2,356.27 2,474.07 2,597.78 2,727.68 2,864.06 MONTHLY 5,105.24 5,360.50 5,628.52 5,909.97 6,205.46 ANNUAL 61,262.94 64,325.95 67,542.29 70,919.61 74,465.56 HOURLY 29.45 30.93 32.47 34.10 35.80 Executive Assistant II
BI-WEEKLY 2,191.01 2,300.55 2,415.58 2,536.36 2,663.18 MONTHLY 4,747.19 4,984.53 5,233.75 5,495.45 5,770.23 ANNUAL 56,966.24 59,814.42 62,805.04 65,945.45 69,242.72 HOURLY 27.39 28.76 30.19 31.70 33.29 Payroll Technician II
BI-WEEKLY 2,084.12 2,188.33 2,297.74 2,412.63 2,533.27 MONTHLY 4,515.59 4,741.38 4,978.44 5,227.37 5,488.75 ANNUAL 54,187.11 56,896.51 59,741.31 62,728.48 65,865.01 HOURLY 26.05 27.35 28.72 30.16 31.67 Confidential Assistant (At-Will)
BI-WEEKLY 2,003.48 2,103.66 2,208.84 2,319.29 2,435.26 MONTHLY 4,340.88 4,557.93 4,785.82 5,025.12 5,276.39 ANNUAL 52,090.59 54,695.16 57,429.89 60,301.49 63,316.67 HOURLY 25.04 26.30 27.61 28.99 30.44 Executive Assistant I
BI-WEEKLY 1,932.00 2,028.59 2,130.02 2,236.52 2,348.35 MONTHLY 4,185.99 4,395.28 4,615.05 4,845.80 5,088.10 ANNUAL 50,231.90 52,743.41 55,380.58 58,149.60 61,057.22 HOURLY 24.15 25.36 26.63 27.96 29.35 Payroll Technician I
BI-WEEKLY 1,894.67 1,989.39 2,088.86 2,193.31 2,302.96 MONTHLY 4,105.11 4,310.35 4,525.86 4,752.18 4,989.75 ANNUAL 49,261.31 51,724.21 54,310.36 57,026.14 59,877.01 HOURLY 23.68 24.87 26.11 27.42 28.79

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CITY OF NATIONAL CITY

CONFIDENTIAL SALARY SCHEDULE
EFFECTIVE DATE JANUARY 2024
3% Increase + Equity Adjustment

TITLE STEP A STEP B STEP C STEP D STEP E
Senior Information Technology Analyst
BI-WEEKLY 3,650.10 3,832.61 4,024.24 4,225.45 4,436.72 MONTHLY 7,908.55 8,303.98 8,719.18 9,155.14 9,612.88 ANNUAL 94,902.62 99,647.79 104,630.18 109,861.65 115,354.61 HOURLY 45.63 47.91 50.30 52.82 55.46 Information Technology Analyst
BI-WEEKLY 3,325.53 3,491.82 3,666.40 3,849.72 4,042.21 MONTHLY 7,205.32 7,565.60 7,943.88 8,341.06 8,758.13 ANNUAL 86,463.79 90,787.20 95,326.52 100,092.76 105,097.50 HOURLY 41.57 43.65 45.83 48.12 50.53 Information Technology Technician
BI-WEEKLY 2,724.23 2,860.44 3,003.45 3,153.63 3,311.31 MONTHLY 5,902.49 6,197.61 6,507.48 6,832.87 7,174.51 ANNUAL 70,829.89 74,371.33 78,089.80 81,994.40 86,094.18 HOURLY 34.05 35.76 37.54 39.42 41.39 Executive Assistant IV
BI-WEEKLY 2,607.69 2,738.09 2,874.98 3,018.73 3,169.67 MONTHLY 5,650.00 5,932.52 6,229.12 6,540.59 6,867.61 ANNUAL 67,800.02 71,190.22 74,749.48 78,487.07 82,411.30 HOURLY 32.60 34.23 35.94

37.73 39.62
Executive Assistant III
BI-WEEKLY 2,470.07 2,593.57 2,723.25 2,859.42 3,002.39 MONTHLY 5,351.83 5,619.41 5,900.38 6,195.42 6,505.19 ANNUAL 64,221.93 67,432.89 70,804.58 74,345.03 78,062.25 HOURLY 30.88 32.42 34.04 35.74 37.53 Executive Assistant II
BI-WEEKLY 2,296.83 2,411.67 2,532.25 2,658.87 2,791.81 MONTHLY 4,976.48 5,225.29 5,486.54 5,760.88 6,048.93 ANNUAL 59,717.71 62,703.46 65,838.52 69,130.62 72,587.15 HOURLY 28.71 30.15 31.65 33.24 34.90 Payroll Technician II
BI-WEEKLY 2,218.96 2,329.91 2,446.41 2,568.73 2,697.17 MONTHLY 4,807.75 5,048.14 5,300.55 5,565.58 5,843.87 ANNUAL 57,693.02 60,577.72 63,606.57 66,787.01 70,126.48 HOURLY 27.74 29.12 30.58 32.11 33.71 Confidential Assistant (At-Will)
BI-WEEKLY 2,091.44 2,196.01 2,305.81 2,421.10 2,542.16 MONTHLY 4,531.45 4,758.02 4,995.92 5,245.73 5,508.02 ANNUAL 54,377.37 57,096.28 59,951.07 62,948.73 66,096.27 HOURLY 26.14 27.45 28.82 30.26 31.78 Executive Assistant I
BI-WEEKLY 2,025.31 2,126.57 2,232.90 2,344.55 2,461.78 MONTHLY 4,388.18 4,607.58 4,837.96 5,079.85 5,333.86 ANNUAL 52,658.11 55,290.92 58,055.46 60,958.22 64,006.29 HOURLY 25.32 26.58 27.91 29.31 30.77 Payroll Technician I
BI-WEEKLY 2,017.25 2,118.11 2,224.01 2,335.22 2,451.96 MONTHLY 4,370.71 4,589.23 4,818.69 5,059.64 5,312.59 ANNUAL 52,448.52 55,070.77 57,824.24 60,715.73 63,751.05 HOURLY 25.22 26.48 27.80 29.19 30.65

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RESOLUTION NO. 2023 -

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA,

AMENDING THE NATIONAL CITY CONFIDENTIAL GROUP SALARY SCHEDULE

WHEREAS, the new classification of Senior Information Technology Analyst was created in 2022 after City Council had authorized annual 3% cost of living adjustments (COLA) for 2023 and 2024 through approval of a Confidential Group Salary Schedule; and WHEREAS, the amendment to add the new classification to the Confidential Group Salary Schedule did not include adjustments for 2023 and 2024 due to an oversight; and WHEREAS, other Confidential Group classifications received and will receive a 3% COLA the first full pay period of January 2023 and January 2024; and WHEREAS, City staff recommends that City Council correct the oversight by authorizing the Senior Information Technology Analyst to receive a 3% COLA retroactively back to January 2023 and a 3% COLA in January 2024, to mirror the COLA wage increases of other Confidential Group classifications.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1: Approves a retroactive 3% cost of living adjustment for the Senior Information Technology Analyst classification for January 2023 and a 3% cost of living adjustment in January 2024 by amending the Confidential Group Salary Schedule.

Section 2: This Resolution shall take effect immediately upon its passage.

Section 3: That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.

PASSED and ADOPTED this 20th day of June, 2023.

Ron Morrison, Mayor
ATTEST:

Shelley Chapel, MMC, City Clerk

APPROVED AS TO FORM:

Barry J. Schultz, City Attorney

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AGENDA REPORT

Department: Library and Community Services
Prepared by: Joyce Ryan, Library & Community Services Director Meeting Date: Tuesday, June 20, 2023
Approved by: Armando Vergara, Interim City Manager

SUBJECT:

Approval of Amendment to Agreement with San Diego County for Senior Nutrition Services

RECOMMENDATION:

BOARD/COMMISSION/COMMITTEE PRIOR ACTION:

Not Applicable.

EXPLANATION:

The City of National City has been contracting with the County of San Diego since 1979 to provide dining room and home delivery meal service to senior citizens 60 years and older. City Council ratified the execution of the most recent County Contract 56176 3 on February 4, 2020 . This Amendment 10 features the following changes:
 Extends the contract term for an additional six (6) months through December 31, 2023; a multi-year agreement with the County will be presented to Council during this time.  Increases the total proposed compensation by $12,360 for FY23 and provides $191,800 for the first six months of FY24 based on the estimated number of meals to be served.

The Amendment also slightly increases the City’s match, which is covered through staff costs and supplies. The City of National City Senior Nutrition Program is open Monday – Friday and serves an average of 200 congregate meals daily at the George H. Waters Nutrition Center. Nutrition Center staff also deliver approximately 80 home-delivered meals daily while conducting wellness checks on local seniors. Food is prepared on -site by professional staff. The suggested contribution for seniors 60+ is $3.50 per meal with those under 60 charged $6.00 per meal. No senior is ever turned away because they cannot pay. The Senior Nutrition Center is a vital service to the senior community as a source of adequate nutrition, wellness, and socialization.

FINANCIAL STATEMENT:

Approval of this item would result in an additional revenue of $12,360 in the current fiscal year (FY23) and $191,800 for the first six months of FY 24 , which has already been incorporated in the FY24 proposed budget. Approval of this item also increases the City’s match by $1,266.54 for FY23 and sets the City’s match for the first six mont hs of FY24 at $19,220.30; however, due to other funding sources, the match is being met with no adjustments to the budget being necessary.

RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:

Health, Environment, and Sustainability

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ENVIRONMENTAL REVIEW:

This is not a project under CEQA and is therefore not subject to environmental review.CCR15378; PRC 21065.

PUBLIC NOTIFICATION:

Agenda Report posted within 72 hours of meeting date and time in accordance with Brown Act.

ORDINANCE:

Not Applicable

EXHIBITS:

Exhibit A - County of San Diego Contract 561763
Exhibit B - County of San Diego Contract 561763 – Amendment 10 Exhibit C - Resolution

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RESOLUTION NO. 2023 -

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY , CALIFORNIA,

AUTHORIZING THE MAYOR TO EXECUTE AN AMENDMENT TO COUNTY CONTRACT 561763 EXTENDING THE CONTRACT TERM FOR SIX (6) ADDITIONAL MONTHS THROUGH DECEMBER 31, 2023.

WHEREAS, the George H. Waters Nutrition Program provides thousands of healthy congregate and home-delivered meals to our local seniors every year; and

WHEREAS, the City of National City previously entered into an agreement with the County of San Diego in order to receive subsidized funding for the meals served to our local senior population; and

WHEREAS, said agreement has a termination date of June 30, 2023 with an option to extend for up to an additional six months; and

WHEREAS, the County of San Diego has exercised the option to extend the contract term for six (6) additional months through December 31, 2023; and

WHEREAS, the County of San Diego has made additional funding available to the City of National City through this amendment for FY23 and will provide $191,800 for the first six months of FY24 based on the estimated number of meals to be served.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1: That the City Council hereby authorizes the Mayor to execute an Amendment to County Contract 561763 extending the contract term for six (6) additional months through December 31, 2023.

Section 2: That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.

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Resolution No. 2023 –
Page Two

PASSED and ADOPTED this 20th day of June, 2023.

Ron Morrison, Mayor

ATTEST:

Shelley Chapel, MMC, City Clerk

APPROVED AS TO FORM:

Barry J. Schultz, City Attorney

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AGENDA REPORT

Department: Library and Community Services
Prepared by: Joyce Ryan, Library & Community Services Director Meeting Date: Tuesday, June 20, 2023
Approved by: Armando Vergara, Interim City Manager

SUBJECT:

Approval of Agreement Between the City of National City and the National City Host Lions Club

RECOMMENDATION:

BOARD/COMMISSION/COMMITTEE PRIOR ACTION:

Not Applicable.

EXPLANATION:

The National City Host Lions Club is hosting its 78th annual 4th of July Carnival from June 30th – July 4th. The organization had been part of National City for over 75 years. The organization has been dedicated to improving the lives of our residents since its charter was established in 1944 and has provided vision exams and eyeglasses through OneSight Visions C linic for thousands of local youth over the years. Its main fundraiser to provide this service for the community is the Fourth of July Carnival.

Last year, on May 17, 2022, the City approved a donation in the amount of $7,750 that augmented a wonderful carnival for our residents. However, due to the rising cost of goods and services, the organization is requesting sponsorship from the City beyond the co -sponsor waiver that was provided to facilitate the return of the carnival and assist in making the carni val a vibrant and exciting event.

Staff recommends entering into an agreement with the National City Host Lions Club. This fundraiser is vital for the continued public benefit to our residents through the OneSight Vision Clinic. A donation request letter from the Lions Club was received and is attached.

FINANCIAL STATEMENT:

Adoption of the resolution authorizes the expenditure of $7,750 to support the NC Host Lions Club’s annual Fourth of July Carnival. Funding is available within the existing appropriations in the General Fund’s Non-departmental budget unit.

RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:

Parks, Recreation and Library

ENVIRONMENTAL REVIEW:

This is not a project under CEQA and is therefore not subject to environmental review.CCR15378; PRC 21065.

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PUBLIC NOTIFICATION:

Agenda Report posted within 72 hours of meeting date and time in accordance with Brown Act.

ORDINANCE:

Not Applicable

EXHIBITS:

Exhibit A - Short Form Services Agreement with National City Host Lions Club Exhibit B - National City Host Lions Club Donation Request Letter Exhibit C - Resolution

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City of National City

BUSINESS TAX CERTIFICATE
"For Services Provided in National City , California Only" Business Name
Business Location
Business Owner(s)

NATIONAL CITY HOST LIONS CLUB
140 E 12TH ST
NAT IONAL CITY, CA 91950-3316

AJ PIERANG ELO

BRIAN CLA PPER

NATIONAL CITY HOST LIONS CLUB
PO BOX 986
NATIONAL CITY, CA 9 1951

THIS BUSINESS TAX CERTIFICATE DOES NOT PERMIT A BUSINESS THAT IS nTHFRWISF PRnHIRI TF n

NATIONAL CITY HOST LIONS CLUB
- CALl ,OR NIA. -

NATIONAL CITY
-3 1-J .i •7 <'--.
lltc.'t>u .. ou ", ~o
2023

TO BE POSTED IN A CONSPICU OUS PLACE
AND

NOT TRANSFERABLE OR ASSIGNA BLE
Business Type E1<empt / Non-Profit
Account Number 09000071
Effective Date January 01 , 2023
Expiration Date December 31, 2023
City Manage r
NOTE: IT IS YOUR OBLIGATION TO RENEW THIS

CERTIFICATE WHETHER OR NOT YOU RECEIVE A
I

RENEWAL NOTICE
For all inquiries regarding this certificate, contact Hdl Business Tax Support Center at (619) 382-2596.

Thank you for your payment on your National City Business Tax Certificate. ALL CERTIFICATES MUST BE AVAILABLE FOR INSPECTION UPON REQUEST . If you have questions concerning your business license , contact the Business Support Center via email at: NationalC ity@HdLgov .com or by telephone at: (619) 382-2596 Keep this portion for your license separate in case you need a replacemen t for any lost, stolen, or destroye d license . A fee may be charged for a replacemen t or dup licate certificate .

This certificate does not entitle the holde r to cond uct business before complying with all requirements of the National City Municipal code and other applicable laws . nor to condu ct business in a zone where conducting such busines s violate s law.

If you have a fixed place of business within the National City, please display the Business Tax Certifica te below in a conspicuous place at he premises . Otherwise, every Business Tax Certifica te holder not having a fixed place of business in the City shall keep the Business Tax Certificate upon his or her person , or affixed in plain view any cart, vehicle, van or other movab le structure or device at all times if requi red by the Collector.

Starting January 1, 2021, Assemb ly Bill 1607 requires the preven tion of gender -based discrimination of business establishments . A full notice is availab le in English or other languages by going to: https ://www .dca.ca.gov/ publ ications/ ._ CAl.l FOff HI~ -

NATIONAL CITY
-:s.. l D J1 ~
l 'f C:011>'0)1 "1 1\0

BUSINESS TAX SUPPORT CENTER
8839 N CEDAR AVE #212
FRESNO, CA 93720-1832

NATION AL C ITY HOST LI ON S CLUB
PO BOX 986
NAT I ONA L CITY, CA 91951
City of National City

BUSINESS TAX CERTIFICATE
Account Number : 09000071
Date of Issue: 01/01/2023

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RESOLUTION NO. 2023 -

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY ,

CALIFORNIA, AUTHORIZING THE CITY MANAGER TO ENTER INTO AN

AGREEMENT WITH THE NATIONAL CITY HOST LIONS CLUB IN THE NOT -TO- EXCEED AMOUNT OF $7,750 TO FACILITATE THE FOURTH OF JULY CARNIVAL FROM FRIDAY, JUNE 30, 2023 TO TUESDAY, JULY 4, 2023.

WHEREAS, the National City Host Lions Club has been an active, worthwhile community organization in National City for 78 years; and WHEREAS, t he National City Host Lions Club has provided vision exams and eyeglasses for thousands of students in National City since 2006 with its OneSight Vision Clinics; and
WHEREAS, the major fundraiser for the National City Host Lions Club is the Fourth of July Carnival held every year in Kimball Park; and
WHEREAS, costs for materials and supplies have risen dramatically within the last few years and the NC Host Lions Club has written a letter requesting assistance from the City.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF NATIONAL CITY,

CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1: That the City Council hereby authorizes the City Manager to enter into an agreement with the National City Host Lions Club in the not-to-exceed amount of $7,750 to facilitate the Fourth of July Carnival from Friday, June 30, 2023 to Tuesday, July 4, 2023.

Section 2: That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.

PASSED and ADOPTED this 20th day of June 2023.

Ron Morrison, Mayor
ATTEST:

Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:

Barry J. Schultz, City Attorney

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AGENDA REPORT

Department: Engineering
Prepared by: Roberto Yano, Director Public Work/City Engineer Meeting Date: Tuesday, June 20, 2023
Approved by: Armando Vergara, Interim City Manager

SUBJECT:

Approval of Agreements with San Diego Gas and Electric Company, BNSF Railway Company, San Diego Metropolitan Transit System, and the San Diego Unified Port District for Segment 5 of the Bayshore Bikeway in National City.

RECOMMENDATION:

Adopt Resolutions Entitled:

1) “Resolution of the City Council of the City of National City, California, authorizing the Mayor to Execute the Agreement with San Diego Gas & Electric Company for the Purpose of Construction, Planting Mitigation, Monitoring, Operation, Inspection, Maintenance, Repair and Replacement of the Bike Path for Segment 5 of the Bayshore Bikeway in the City of National City;” and,

2) “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Agreement with BNSF Railway Company for the Purpose of Construction, Plant Mitigation, Operation, Inspection, Maintenance, Repair and Replacement of the Bike Path for Segment 5 of the Bayshore Bikeway in the City of National City;” and,

3) “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Agreement with San Diego Metropolitan Transit System for the P urpose of Construction, Planting Mitigation, Monitoring, Operation, Inspection, Maintenance, R epair and Replacement of the Bike Path for Segment 5 of the Bayshore Bikeway in the City of National City;” and,

4) “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute the Agreement with the San Diego Unified Port District for the Purpose of Construction, Planting Mitigation, Monitoring, Operation, Inspection, Maintenance, Repair and Replacement of the Bike Path for Segment 5 of the Bayshore Bikeway in the City of National City.”

BOARD/COMMISSION/COMMITTEE PRIOR ACTION:

Not Applicable.

EXPLANATION:

The City has been working on Segment 5 of the Bayshore Bikeway (Exhibit E) that will connect the existing Class I bike path where it ends by the marina storage yard adjacent to the Paradise Marsh with a new 13’ -15’ wide 1.45 mile long Class I asphalt bike path, including new traffic signals; cross walks; lane striping; updated parking configuration; curbs and ramps; wayfinding signage; lighting; three retaining walls; grading; marsh protection; 4’ high chain link fencing; and mitigation planting. This project is part of the Balance d Plan, a partnership with the San Diego Unified Port District and the City. In order to accomplish this project that is not only on City

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property/right-of-way, but also on the property of San Diego Gas & Electric Company, BNSF Railway Company, San Diego Metropolitan Transit System, and the San Diego Unified Port District, the City needs to enter into a number of agreements. Exhibit E shows the four properties along the proposed new bike path alignment. The following is a summary of each agreement that will be required:

San Diego Gas & Electric Company (SDG&E) “License Agreement” (Exhibit A). The City is proposing to sign a License Agreement for use of approximately 10,450 square feet of existing bikeway and 1,145 square feet of proposed bikeway (comprising of a total of approximately 11,595 square feet) of real property for constructing and maintaining an extension to the existing bike path. The term of the License Agreement is for an initial five (5) years with three (3) additional and successive options terms of five (5) years (total of 20 years) upon mutual agreement. The License Fee for the term of the License and including renewals is a one-time payment of $35,000.

BNSF Railway Company (BSNF) “Grade Crossing Construction and Maintenance Agreement” and Easement Agreements (one temporary and two permanent easements) (Exhibit B) . The Cit y is proposing to sign these agreements allowing for the installation of crossing signals/activation equipment, new crossing surfaces including, but not limited to any and all changes to communication, signal and electrical lines and appurtenances, tempora ry or permanent track work, fencing, grading, alterations to or new construction of drainage facilities of the “at grade crossing” at Harbor Drive and Bay Marina Drive. T he term of the Construction License is twelve (12) months following the effective date. The term of the permanent easements for the equipment and improvements on BNSF property is perpetual and the temporary is during construction only. Fees for the easements are approximately $56,000. Note: As of the submittal of the staff reports, City staff are still working out minor details with BNSF. Staff is requesting the City Council to approve the draft agreement and give the Mayor authority to execute the agreement, once finalized, subject to City Attorney approval.

San Diego Metropolitan Transit System (MTS) “Construction and Maintenance Agreement for the Bayshore Bikeway Project” and a “Railroad Right-Of-Way License” (Exhibit C). The City is proposing to sign this Construction and Maintenance (C&M) agreement and the License for the exclusive purpose for construction, use, operation, maintenance, repair and ownership of the bikeway and bikeway appurtenances that crosses within the Licensor’s right-of-way. The term of the license is an open condition that allows either party to terminate with 90 day written notice.

San Diego Unified Port District “Easement and Maintenance Agreement” (Exhibit D). The City is proposing to sign this agreement for the purposes of construction, monitoring, operation, inspection, maintenance, repair, and replacement of improvements that consist of a bicycle path, retaining wall fence and other related improvements and appurtenances and performing habitat and biological mitigation on Port property. The term is for sixty six (66) years.

This long awaited project is nearing the construction phase. Once these agreements are approved, the next steps include acquiring a CALTRANS encroachment permit, CPUC approval on the work associated with the BNSF property/at grade crossing, approval from Sweetwater Water Authority to relocate a waterline, and Construction Funding Allocation from the Federal Highway Administration (FHWA).

Staff recommends the adoption of the attached resolution s approving the agreements and easements with San Diego Gas & E lectric Company, BNSF Railway Company, San Diego Metropolitan Transit System, and the San Diego Unified Port District.

FINANCIAL STATEMENT:

The project’s estimated total cost is approximately $9 million dollars to be funded by FHWA, the Port of San Diego and the City. Appropriations to pay for the $91,000 in fees associated with the

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SDG&E and BNSF agreements are available in account 296-409-500-598-6611 AHSC - BAYSHORE BIKEWAY SEGMENT 5.

RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:

Transportation Choices and Infrastructure

ENVIRONMENTAL REVIEW:

This project is part of the Approved EIR for the Balanced Plan

PUBLIC NOTIFICATION:

Agenda Report posted within 72 hours of meeting date and time in accordance with Brown Act.

ORDINANCE:

Not Applicable

EXHIBITS:

Exhibit A – License Agreement with SDG&E
Exhibit B – Grade Crossing Construction and Mainten ance Agreement with BNSF Railway Company
Exhibit C – Construction and Maintenance Agreement for the Bayshore Bikeway Project and Railroad Right-of-Way with San Diego Metropolitan System Exhibit D – Easement and Maintenance Agreement with the San Diego Unified Port District Exhibit E – Bayshore Bikeway ROW Map
Exhibit F – Resolution – SDG&E
Exhibit G – Resolution – BNSF
Exhibit H – Resolution – MTS
Exhibit I – Resolution – Port

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LICENSE AGREEMENT

THIS LICENSE AGREEMENT (this “Agreement”), made and entered into as of __________ ____, 2023, by and between San Diego Gas & Electric Company, a California corporation, hereinafter called “Licensor,” and the City of National City, a California municipal corporation, hereinafter called “Licensee.” Licensor and Licensee are each sometimes referred to in this Agreement individually as a “Party” and collectively as the “Parties”.

RECITALS
A. Licensor owns certain parcels of real property identified by Assessor Parcel Number(s):
562-210-03-00 and 562-210-05-00 in the City of National City, County of San Diego, California (collectively, the “Real Property”).

B. Licensee desires to use approximately 10,450 square feet of existing bikeway and 1,145 square feet of proposed bikeway (comprising a total of approximately 11,595 square feet) of the Real Property as depicted on Exhibit “A” attached hereto and made a part hereof (the “Licensed Premises”), for constructing and maintaining an extension to an existing asphalt public bike path and for no other purpose (the “Permitted Purpose”).

C. Licensee has requested from Licensor and Licensor has agreed to grant to Licensee a short-term, revocable, non-exclusive license (the “License”) to use the Licensed Premises solely for the Permitted Purpose upon the terms and conditions set forth in this Agreement.

AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Licensor and Licensee hereby agree as follows:

1. Grant of License:

Licensor grants to Licensee a License to use the Licensed Premises solely for the Permitted Purpose upon the terms and conditions set forth in this Agreement.

2. Term of License:

The term (“Term”) of the License shall be for five (5) years, commencing on the last date next to a party’s signature below (“Commencement Date”), unless the License is earlier revoked or this Agreement is earlier terminated in accordance with the terms, conditions and provisions hereinafter set forth below. Provided Licensee is not in default of any of any of the terms of this License, Licensee shall have three (3) additional and successive options terms of five (5) years each. Licensee shall provide notice to Licensor at least thirty (30) days prior to the end of each term of its desire to renew the License, and the License shall renew on terms by mutual agreement of the parties.

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3. License Fee:

On or before the Commencement Date, Licensee shall pay to Licensor a one-time payment of Thirty-Five Thousand and No/100 Dollars ($35,000.00) (“License Fee”) for the Term of this License, including any and all renewal terms provided in this Agreement, to SDG&E Payment Center, P.O. Box 25110 Santa Ana, CA 92799-5110.

4. Termination; Revocability of License:
(a) Either Party may terminate this Agreement and the License contained herein at any time, for any reason or no reason, with or without cause, by providing thirty (30) days’ prior written notice to the other Party of its desire to terminate the License using such Party’s address for notice listed in Paragraph 18 below. Upon delivery of such written notice, this Agreement and the License contained herein shall automatically terminate in thirty (30) days without the necessity for any further action by either Party, subject to the surrender provisions of Paragraph 17 and 11(h).

5. Non-Exclusivity of License:
(a) The License granted under this Agreement is non-exclusive. (b) Licensor hereby reserves the right, during the Term of the License, without any requirement of notice to or consent of Licensee, to (i) grant, sell, transfer, option, convey, or dispose of all or any portion of or interest in the Real Property and/or Licensed Premises, and (ii) grant any easement, servitude, restriction, mortgage, deed of trust, security instrument, lease, license, encumbrance, or lien affecting all or any portion of or interest in the Real Property and/or Licensed Premises.
(c) Licensor hereby reserves the right, at any time during the Term of the License, to enter upon the Licensed Premises for all purposes and uses.

6. Condition of Licensed Premises:
(a) LICENSEE HEREBY ACCEPTS THE LICENSED PREMISES “AS IS, WHERE IS” WITH ALL FAULTS. This Agreement and the License contained herein is and shall be subject and subordinate to all interests which may now or hereafter affect the Real Property and/or the Licensed Premises and to all mortgages which may now or hereafter affect such interests, the Licensed Premises and/or the Real Property, and to all renewals, refinancings, modifications, replacements and extensions thereof (hereinafter, collectively called, “Superior Interest”). The provisions of this Paragraph 6(a) shall be self-operative and no further instrument of subordination shall be required. In confirmation of such subordination, Licensee shall promptly execute and deliver at its own cost and expense any instrument, in recordable form if required, that Licensor, the holder of any Superior Interest or any of their respective successors in interest may request to evidence such subordination.

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(b) Licensee hereby acknowledges that none of Licensor, its current or future parent company, subsidiaries, or its or their officers, employees, directors, shareholders, contractors, agents, representatives, other licensees, invitees, successors and assigns (collectively, “Licensor Parties”) or any other party purporting to act on their behalf has made any representation or warranty whatsoever regarding the Real Property and the Licensed Premises, and Licensor hereby disclaims all representations and warranties (whether express or implied) in respect of the Real Property and the Licensed Premises, including but not limited to any implied warranty of habitability or suitability of the Licensed Premises for a particular purpose. Licensee hereby acknowledges that Licensee has conducted its own due diligence in respect of the Real Property and the Licensed Premises and has independently (and not in reliance on any representations or warranties of Licensor, the Licensor Parties or any other party purporting to act on their behalf) determined to acquire the License to use the Licensed Premises for the Permitted Purpose. (c) Licensee hereby assumes any and all risks arising from the physical condition of the Real Property and the Licensed Premises, including but not limited to the risk that patent or latent defects and/or hazardous conditions may now or hereafter exist within the Real Property and the Licensed Premises. Licensor hereby disclaims any and all responsibility or liability for any injury, damage, lien, judgement, loss, liability, claim, cause or action, suit, demand, obligation, fee, damage, cost, expense, fine, penalty, or other expenses of any type whatsoever, whether consequential, direct, indirect, punitive, or otherwise, including but not limited to in-house and outside attorney’s fees, witness fees and consultant fees (collectively, “Claims”), that Licensee or its affiliates, employees, agents, representatives, invitees, licensees, permittees, contractors, and/or subcontractors (collectively, the “Licensee Parties”) may suffer or incur as a result of the physical condition of the Real Property and the Licensed Premises, including but not limited to the existence of any patent or latent defects and/or hazardous conditions.

7. Access to Licensed Premises:

Licensee shall have the right of ingress to and egress to the Licensed Premises upon routes mutually agreed to by the Parties (the “Access Rights”), provided that Licensee shall (a) comply with all Applicable Laws (as defined below) in exercising the Access Rights, and (b) exercise the Access Rights in a manner that does not interfere with the activities of Licensor and/or the Licensor Parties in respect of the Licensed Premises and the Real Property.

8. Use of Licensed Premises:
(a) Licensee shall use the Licensed Premises solely for the Permitted Purpose, as described in Recital B above, and for no other purpose. (b) Licensee shall obtain all permits and approvals required by all federal, state, county, municipal or other local governmental authorities, bureaus, or agencies (each, a “Governmental Authority”) with respect to any activity conducted by Licensee or the Licensee Parties in respect of the License or the Licensed Premises (collectively, the “Permits and Approvals”). At all times during the Term, Licensee shall comply (and shall cause the Licensee Parties to comply) with (i) the terms and conditions of all Permits and Approvals, and (ii) all federal, state, county, municipal, and other local laws, statutes, codes, ordinances, rules, regulations, directives, policies, decisions,

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guidelines, and orders now or hereafter applicable to Licensee, the Licensed Premises, or the Permitted Purpose (collectively, as the same may be amended from time to time, “Applicable Laws”). Licensee shall promptly notify Licensor if Licensee or any of the Licensee Parties receive any notice of any violation of the Permits and Approvals or any Applicable Law. Licensee shall cure any violation of the Permits and Approvals or any Applicable Law within ten (10) days after receiving notice of such violation, provided that if such violation is not capable of being cured within ten (10) days, Licensee shall commence to cure such violation within ten (10) days and shall be diligently prosecuting such cure to completion within thirty (30) days after receiving notice of such violation.
(c) At all times during the Term, Licensee shall conduct (and shall cause the Licensee Parties to conduct) all activities in respect of the License and the Licensed Premises in a manner (i) that will not interfere with the activities of Licensor and/or the Licensor Parties in respect of the Licensed Premises and/or the Real Property, and (ii) designed to guard against soil erosion, explosions, and fires within the Licensed Premises.
(d) None of Licensee or the Licensee Parties shall cause or permit (i) any activity to occur in respect of the License or the Licensed Premises that constitutes waste or public or private nuisance, (ii) any explosive or highly flammable substances or materials to be stored, released, generated, placed, handled, or used within the Real Property and the Licensed Premises, (iii) any recreational vehicles to be parked within the Real Property, or (iv) any party to live or reside within the Licensed Premises. Neither Licensee nor the Licensee Parties shall make or permit to be made any use of the Licensed Premises which may invalidate or increase the premium cost of any policy of insurance carried on, or self-insurance applicable to, the Real Property or covering its operations.
(e) Without the prior written consent of Licensor, which may be withheld in Licensor’s sole discretion, none of Licensee or the Licensee Parties shall cause or permit (i) any buildings, structures, or other improvements to be constructed, erected, or installed within the Licensed Premises save those structures and improvements already onsite, if any, (ii) any heavy machinery or equipment to be operated or stored within the Licensed Premises, (iii) the ground surface elevation of the Licensed Premises to be changed in any manner, or (iv) the ground within the Licensed Premises to be penetrated in any manner. Notwithstanding the foregoing, Licensor has consented to the initial construction work as described on Exhibit “B” attached hereto and made a part hereof, in particular on pages 8, 16, 55, 68, 77 and 93, and to be undertaken by Licensee promptly following the Commencement Date.
(f) Licensee shall keep (and shall cause all Licensee Parties to keep) the Real Property and the Licensed Premises free from and shall promptly discharge any liens arising from any work performed, material furnished, obligations incurred, or any other thing done or permitted by Licensee and/or the Licensee Parties in respect of the License or the Licensed Premises; provided, that Licensee (or a Licensee Party) may dispute any such lien so long as Licensee (or such Licensee Party) first posts a bond for such lien in the amount required by Licensor. (g) If Licensee and/or any Licensee Party fails to comply with or defaults under any obligation set forth in this Paragraph 8, then Licensor may (but shall not be obligated to) cure such

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failure at Licensee’s sole expense, and Licensee shall, upon demand, pay to Licensor all costs incurred by Licensor and/or the Licensor Parties in curing such failure. (h) Licensee assumes full responsibility for protecting the Licensed Premises and any equipment and supplies that Licensee or the Licensee Parties may place within the Licensed Premises from theft, robbery and pilferage, and for keeping the Licensed Premises secure. All property belonging to Licensee or the Licensee Parties shall be there at the risk of the Licensee or the Licensee Parties only, and Licensor and the Licensor Parties shall not be liable for damage thereto or theft or misappropriation thereof.

9. Maintenance of Licensed Premises:
(a) At all times during the Term, Licensee shall, at its sole expense, maintain the Licensed Premises in good condition, working order, and repair. Without limiting the generality of the foregoing sentence, Licensee shall keep (and shall cause the Licensee Parties to keep) the Licensed Premises clean and free from any trash, rubbish, debris, waste, weeds, brush, and/or explosive or highly flammable materials.
(b) During the Term, none of Licensor or the Licensor Parties shall have any obligation to (i) maintain, improve, alter, or repair the Licensed Premises, or (ii) furnish any utilities to the Licensed Premises, including but not limited to electricity, gas, water, or telephone service.

Licensee shall pay the cost of any such utilities furnished to the Licensed Premises. (c) If Licensee and/or any Licensee Party fails to comply with or defaults under any obligation set forth in this Paragraph 9, then Licensor may (but shall not be obligated to) cure such failure at Licensee’s sole expense, and Licensee shall, upon demand, pay to Licensor all costs incurred by Licensor and/or any Licensor Parties in curing such failure. (d) Licensee shall furnish at its expense all personnel necessary to operate the Licensed Premises, and shall provide at its own expense all security necessary for use of the Licenses Premises.

10. Improvement of Licensed Premises:
(a) None of Licensee or the Licensee Parties shall cause or permit any alteration, modification, building, structure, landscaping, or other improvement (each, an “Alteration”) to be made, constructed, or installed within the Licensed Premises without the prior written consent of Licensor, such consent to be in Licensor’s sole discretion. (b) If Licensor grants its prior written consent to any Alteration, none of Licensee or the Licensee Parties shall cause or permit work to begin with respect to such Alteration unless and until Licensor has reviewed and granted written consent, in Licensor’s sole discretion, of all plans and specifications for such Alteration. Upon Licensor’s written consent, such Alteration shall be deemed to be a “Permitted Alteration.”

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(c) Any work performed in connection with any Permitted Alteration shall be performed in accordance with all Applicable Laws and the terms and conditions contained in this Agreement.

11. Environmental Compliance:
(a) The term “Environmental Law” shall mean any Applicable Law pertaining to worker or workplace safety, environmental conditions, environmental quality or policy, health and/or safety issues or concerns, the regulations promulgated pursuant thereto, and the conditions of any permits, judgments, agreements, or authorizations issued pursuant thereto, including but not limited to (i) the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), 43 U.S.C. §9601 et seq., (ii) the Resource Conservation and Recovery Act of 1976 (“RCRA”), 42 U.S.C. §6901 et seq., (iii) the Toxic Substances Control Act of 1976 (TSCA), 15 U.S.C. §2601 et seq., (iv) the Hazardous Materials Transportation Act, 49 U.S.C. §1801 et seq., (v) the Clean Water Act, 33 U.S.C. §1251, et seq., (vi) the Porter Cologne Water Quality Act, California Water Code §13000 et seq., and (vii) the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code §25249.5 et seq., (viii) The Carpenter-Presley- Tanner Hazardous Substance Account Act (California Health & Safety Code, §25300 et seq., (ix) The California Hazardous Waste Control Law (California Health & Safety Code, §15200 et seq., (x) The Occupational Safety and Health Act (29 U.S.C. §651 et seq.), and (xi) the California Occupational Safety and Health Act (California Labor Code §6300 et seq.). (b) The term “Hazardous Substance” as used in this Agreement shall mean any products, substance, chemical, material, or waste whose presence, nature, quantity and/or intensity of existence, use, manufacture, disposal, transportation, spill, release, or effect, either by itself or in combination with other materials expected to be on the Licensed Premises, is either; (i) potentially injurious to the public health, safety, or welfare, the environment, or the Real Property and the Licensed Premises, (ii) regulated or monitored by any Governmental Authority, or (iii) a basis for liability of Licensor to any governmental agency or third party under any applicable statute or common law theory. Hazardous Substance shall include, but not be limited to, hydrocarbons, petroleum, gasoline, crude oil, or any products, by-products, or fractions thereof. (c) The term “Environmental Activity” shall mean the use, generation, treatment, storage, handling, release, or threatened release of any Hazardous Substance in, on, under, or about the Licensed Premises or the underlying ground water or the transportation or migration of any Hazardous Substance to or from the Licensed Premises.
(d) At all times during the Term of the License, Licensee shall comply (and shall cause the Licensee Parties to comply), at Licensee’s sole cost and expense, with all Environmental Laws, now in effect or which may hereafter come into effect. Licensee and/or the Licensee Parties may not conduct an Environmental Activity on, under, or about the Licensed Premises at any time. (e) Licensee shall (and shall cause the Licensee Parties to) deliver written notice to Licensor in accordance with Paragraph 18 below within twenty-four (24) hours of receiving actual notice of any of the following:
(i) Any proceeding or inquiry by any Governmental Authority with respect to (A) the presence of any Hazardous Substance on, under, or about the Licensed Premises,

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(B) the migration of any Hazardous Substance to or from the Licensed Premises, or (C) any Environmental Activity.
(ii) Any threatened or actual claim by any third party against any of Licensor, the Licensor Parties, Licensee, the Licensee Parties, or the Licensed Premises relating to or resulting from (A) the presence of any Hazardous Substance on, under, or about the Licensed Premises, (B) the migration of any Hazardous Substance to or from the Licensed Premises, or (C) any Environmental Activity.
(iii) The discovery of any occurrence or condition on or near the Licensed Premises that has caused or could cause the Licensed Premises to be contaminated with a Hazardous Substance or subject to any ownership, occupancy, transferability, or use restrictions under any Environmental Law.

Licensee shall also immediately give Licensor a copy of any statement, report, notice, registration, application, permit, business plan, license, claim, action, or proceeding given to, or received from, any Governmental Authority or private party, or persons entering or occupying the Licensed Premises, concerning the presence, spill, release, discharge of, or exposure to, any Hazardous Substance or contamination in, on, or about the Licensed Premises. (f) Licensee and its successors and assigns shall be liable and responsible for any Hazardous Substances brought on or released on, in, under, or within the Licensed Premises by Licensee, Licensee Parties, or any persons or entity under Licensee’s control during the Term.

Licensee and its successors and assigns shall indemnify, protect, defend, reimburse, and hold Licensor and the Licensor Parties harmless from and against any and all Claims, including the cost of remediation (which includes, but is not limited to, any remediation required by a governmental agency), arising out of or in connection with the introduction of any Hazardous Substance onto the Real Property and the Licensed Premises by or for Licensee, Licensee Parties, or any persons or entity under Licensee’s control. Licensee’s obligations (including, but not limited to paying for the cost and expense) under this Paragraph 11 shall include, but not be limited to: (i) removal from the Real Property and the Licensed Premises of any such Hazardous Substances; (ii) removal from any area outside the Licensed Premises, including but not limited to surface and ground water, of any such Hazardous Substance generated as part of the operations on the Licensed Premises; (iii) damages to persons, property, and the Real Property and the Licensed Premises; (iv) all claims resulting from those damages; (v) fines or penalties imposed by any government agency, and (vi) any other liability as provided by Applicable Laws. No termination, cancellation or release agreement entered into by Licensor and Licensee shall release Licensee from its obligations under this Agreement with respect to any Hazardous Substance, unless specifically so agreed by Licensor in writing at the time of such agreement. Licensor shall have the right (but shall not be obligated) to approve, in its sole discretion, any and all contractors hired by Licensee or Licensee Parties to perform such mitigation or remediation work.
(g) Licensor shall have the right to enter the Licensed Premises at any time for any reason, including, without limitation, for the purpose of inspecting and/or assessing the condition of the Licensed Premises and for verifying compliance by Licensee, Licensee Parties or any persons or entities under Licensee’s control with this License, and all Applicable Laws. The costs and expenses of any such inspections and/or assessments on the Licensed Premises shall be paid by Licensor, unless a violation of Applicable Laws or a contamination caused by Licensee, Licensee Parties or any persons or entities under Licensee’s control requiring investigation,

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removal, remediation, or restoration under Applicable Laws is discovered, or unless such inspection is required by a Governmental Authority. If such a violation or contamination occurs, Licensee shall, within fifteen (15) days of Licensor’s written request, reimburse Licensor for all reasonable costs and expenses arising out of such inspections. (h) Upon termination of this Agreement and the License herein, prior to surrendering possession of the Licensed Premises, and in addition to the requirements set forth in Paragraph 17, Licensee shall (and shall cause the Licensee Parties to) remove any personal property, equipment, appurtenances, fixtures, facilities, and/or storage devices or vessels that are contaminated by or contain Hazardous Substances or are used in connection with any Environmental Activity; subject to the time required of Licensee to promptly process and award a public contract and to reasonably perform such removal actions, but in no case longer than ninety (90) days following termination of this Agreement.
(i) If Licensee and/or any Licensee Party fails to comply with or defaults under any obligation set forth in this Paragraph 11, then Licensor may (but shall not be obligated to) cure such failure at Licensee’s sole expense, and Licensee shall, upon demand, pay to Licensor all costs incurred by Licensor and/or any Licensor Parties in curing such failure. (j) The obligations set forth in this Paragraph 11 are independent of any other obligations contained in this Agreement and shall survive the expiration or earlier termination of this Agreement.

12. Taxes:
(a) Licensee shall pay to Licensor, within ten (10) calendar days after written demand, an amount equal to the ad valorem taxes levied or assessed with respect to the Licensed Premises during the Term.
(b) Licensee shall pay any taxes levied or assessed on any personal property installed or placed within the Licensed Premises by Licensee or the Licensee Parties. Licensee shall not be responsible for taxes levied against improvements and personal property placed or constructed on the Licensed Premises by Licensor.

13. Insurance:
(a) At all times during the Term, Licensee shall maintain in effect the following insurance coverages in amounts not less than the following minimum limits:
(i) Workers’ Compensation and Employer’s Liability insurance in accordance with statutory requirements and limits. Licensee shall also maintain Employer’s Liability coverage in the amount of not less than $1,000,000 per accident and per employee for disease. In lieu of such insurance, Licensee may maintain a self-insurance program meeting the requirements of the state(s) in which the services shall be performed along with the required Employer’s Liability insurance,

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(ii) Commercial General Liability insurance with limits of not less than $2,000,000.00 per occurrence and $3,000,000 in the aggregate for bodily injury and property damage and shall contain a severability of interest or cross-liability clause, and (iii) Automobile Liability insurance insuring against liability for damages for bodily injury, death, or damage to property (including loss of use thereof), and occurring in any way related to the use by or on behalf of the Licensee. Such coverage shall be in an amount of not less than $1,000,000.00 combined single limit. (b) On or prior to the Commencement Date and at any time during the Term, upon Licensor’s request, Licensee shall provide Licensor with insurance policies or current certificates including applicable endorsements, and renewal certificates thereafter, executed by a duly authorized representative of each insurer, or by the insurance agent or broker authorized to do so, evidencing the insurance coverages required to be maintained by Licensee under Paragraph 13(a) above. Such policies shall:
(i) name Licensor and its parent company, and its subsidiaries, affiliates and its respective officers, directors, employees, agents, representatives, successors and assigns as an additional insured for all required polices under Paragraph 13(a) except workers’ compensation insurance.
(ii) contain a waiver of subrogation in favor of Licensor for all policies in Paragraph 13(a),
(iii) state that such insurance coverage is primary for all purposes, and (iv) state that no insurance policy may be canceled, materially revised, or subject to non-renewal without at least thirty (30) calendar days prior written notice being given to Licensor, ten (10) days for non-payment of premium.
(c) All required policies of insurance shall be written by companies having an A. M.

Best rating of “A-, VII” or better, or equivalent and authorized to transact business in the State of California by the Insurance Commission of California.
(d) Licensee shall be solely responsible for any deductible or self-insured retention on insurance required in Paragraph 13(a).
(e) The obligation to maintain the insurance coverages set forth in this Paragraph 13 shall not in any way limit or diminish any of Licensee’s other obligations, responsibilities or liabilities under this Agreement.

14. Indemnification:
(a) Licensee hereby agrees to indemnify, defend, and hold harmless Licensor and the Licensor Parties from and against any and all Claims arising out of or in connection with (i) this

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Agreement and (ii) Licensee's or any Licensee Party’s use, maintenance, presence on, or occupation of the Licensed Premises.
(b) Licensee shall be given a reasonable amount of time to defend and resolve any third-party claim presented to Licensor and promptly thereafter reimburse any Claim incurred by any Licensor Parties within thirty (30) days after written demand by such Licensor Parties. (c) Should Licensee fail to promptly resolve any claim presented to Licensor and upon demand by Licensor or any Licensor Parties, Licensee shall defend, at Licensee’s sole expense, with counsel reasonably acceptable to such Licensor Parties, any Claims brought against such Licensor Parties with respect to which Licensee is obligated to defend the Licensor Parties under Paragraph 14(a) above. In the event that Licensee settles any such Claim, such settlement shall include a dismissal with prejudice of the Claim and an explicit and unconditional release (including a waiver of Section 1542 of the California Civil Code) from the party bringing such Claim. (d) The obligations of Licensee under this Paragraph 14 shall not be limited in any way by any limitation on the amount or type of damages, compensation, or benefits payable by or for the Licensee under any worker's compensation acts, disability benefit acts, or other employee benefit acts.
(e) Nothing contained herein shall operate as a limitation on the right of Licensor to bring an action for damages against any third party, including indirect, special, or consequential damages, based on any acts or omissions of such third party. Licensee shall assign such rights of claims, execute such documents, and do whatever else may be reasonably necessary to enable Licensor to pursue any such action against such third party. (f) The obligations of Licensee under this Paragraph 14 shall survive the expiration or earlier termination of this Agreement.

15. Release:
(a) Licensee, on behalf of itself and the Licensee Parties, hereby releases, waives, and forever discharges Licensor and the Licensor Parties from any and all past, present, or future Claims of any nature whatsoever, known or unknown, arising from, related to, or regarding the presence on or occupation of the Licensed Premises by Licensee and/or the Licensee Parties or any other exercise of the rights granted to Licensee and/or the Licensee Parties under this Agreement (“Release”).
(b) Licensee, on behalf of itself and the Licensee Parties, expressly and voluntarily waives and relinquishes all rights and benefits under Section 1542 of the California Civil Code if in any way applicable to the Release. Section 1542 of the California Civil Code provides as follows:

GENERAL RELEASE CLAIMS EXTINGUISHED: A GENERAL

RELEASE DOES NOT EXTEND TO CLAIMS THAT THE

CREDITOR OR RELEASING PARTY DOES NOT KNOW OR

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SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME

OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY

HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS

OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED
PARTY.

Licensee acknowledges that it has received the advice of legal counsel with respect to the Section 1542 waiver and understands the terms of such waiver. Licensee hereby acknowledges it is aware that Licensee and/or the Licensee Parties may hereafter discover facts different from or in addition to those which Licensee and/or the Licensee Parties now know or believe to be true with respect to the Release, and Licensee agrees that the Release shall be and remain in effect as a full and complete mutual release notwithstanding any such different or additional facts.

Licensee Initials: ______

16. Condemnation:
(a) If all or any portion of the Licensed Premises is taken by any public or quasi-public authority under the power of condemnation or eminent domain, the License shall terminate as to that portion so taken on the date that such taking becomes final (the “Condemnation Date”). With respect to the remaining portion of the Licensed Premises, Licensee may terminate the License as of the Condemnation Date by delivering written notice to Licensor in accordance with Paragraph 4(a) above and Paragraph 18 below on or before the Condemnation Date, provided that if Licensee fails to deliver such written notice to Licensor on or before the Condemnation Date, then the License shall continue in full force and effect in accordance with this Agreement. (b) Any and all awards or damages granted in connection with such taking (the “Condemnation Award”) shall belong to and be the sole property of Licensor, provided that, if Licensee is not allowed to remove any personal property, equipment, appurtenances, fixtures, or facilities (the “Personal Property”) from the portion of the Licensed Premises taken and Licensee would otherwise be permitted to remove such Personal Property under this Agreement, then Licensee shall receive that portion of the Condemnation Award paid to Licensor that is attributable to such Personal Property so retained.
(c) As material consideration for Licensor’s obligations under this License, Licensee fully waives, releases and discharges Licensor and all Licensor Parties from and against any and all Claims, known or unknown, now existing or hereinafter arising, which arise from or relate in any manner to the expiration or termination of Licensee’s License as provided for herein, or the discontinuance or relocation of Licensee’s business operations, or the relocation of any person, business, or other occupant located on or within the premises, including the waiver and release of all business goodwill claims (if any) and all relocation rights and benefits available under Applicable Laws.

17. Surrender of Licensed Premises:

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(a) Upon the expiration or earlier termination of this Agreement, Licensee shall promptly vacate and surrender the Licensed Premises to Licensor and shall deliver the Licensed Premises to Licensor clean and free from any trash, rubbish, debris, waste, weeds, brush, explosive or highly flammable materials, and/or Hazardous Substances and otherwise in a condition satisfactory to Licensor, and remove from the Licensed Premises all buildings, structures, improvements, and Personal Property constructed, installed, placed, or stored on the Licensed Premises by Licensee or any Licensee Party. All such obligations shall be completed by the expiration or earlier termination date, subject to the time required of Licensee to promptly process and award a public contract and to reasonably perform removal of the bike path improvements, but in no case longer than ninety (90) days following the expiration or earlier termination of this Agreement. Licensee’s obligation to observe and perform this covenant shall survive the expiration or other termination of this Agreement.
(b) If Licensee fails to comply with any of the obligations set forth in this Paragraph 17, the Licensor may (but shall not be obligated to) cure such failure at Licensee’s sole expense, and Licensee shall, upon demand, pay to Licensor all costs incurred by Licensor in performing such obligations, including but not limited to all labor costs, overhead expenses, rental of storage space, equipment rental, materials, and machinery fuel costs. (c) If Licensee and/or any Licensee Party fails to promptly vacate and surrender the Licensed Premises after the expiration or earlier termination of this Agreement, then, in addition to any other rights or remedies that Licensor may have, Licensee and/or such Licensee Party shall pay to Licensor an amount equal to one hundred fifty percent (150%) of the annual License Fee prorated for the period that Licensee and/or such Licensee Party continues to occupy the Licensed Premises following the expiration or termination date. Licensee’s payment of such amounts shall not be construed to extend the Term or prevent Licensor from immediate recovery of possession of the Licensed Premises by summary proceedings or otherwise. (d) The obligations of Licensee under this Paragraph 17 shall survive the expiration or termination of this Agreement.

18. Notices:
(a) All notices to be given under this Agreement shall be in writing, addressed to the recipient Party at the address listed below, and: (i) sent by certified mail, return receipt requested, in which case notice shall be deemed delivered three (3) business days after deposit, postage prepaid in the United States mail; (ii) sent by a nationally recognized overnight courier, in which case notice shall be deemed delivered one (1) business day after deposit with such overnight courier; or (ii) sent by telecopy, email, or similar means, provided that a copy of the notice is also sent by certified mail, in which case notice shall be deemed delivered on transmittal by telecopier, email, or other similar means provided that a transmission report or email is generated reflecting the accurate transmission of the notices. Each Party’s address for notices under this Agreement is set forth below:
(i) If to Licensor: San Diego Gas & Electric Company
8335 Century Park Court, CP-12A

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San Diego, California 92123
Attention: Adam C. Smith
Telephone: (858) 637-3789
Email: [email protected]

With a copy to: San Diego Gas & Electric
Law Department
8330 Century Park Court, CP32C
San Diego, CA 92123
Attention: Real Estate Counsel
Telephone: (858) 636-6846

(ii) If to Licensee: City of National City
Attn: ________________

Fax: _________________
Telephone: ____________
email: ________________

19. Disclosure Regarding Electric and Magnetic Fields:

Licensor hereby notifies Licensee and the Licensee Parties that due to the presence of electric utility facilities within or near the Licensed Premises, electric, and magnetic fields (EMF) may be present. The medical and scientific communities have been unable to determine whether EMF causes health effects or establish any standard or level of exposure that is known to be either safe or harmful. Many researchers believe that if there is a risk of adverse health effects from EMF, the risk is probably low but warrants further investigation.

20. No Assignment:

Licensee may not assign this Agreement or any interest herein, either in whole or in part, to any other person or entity at any time. Licensee is specifically prohibited from sublicensing, leasing, licensing, renting or allowing the occupation of the Licensed Premises, or any interest therein, either in whole or in part, to any other person or entity.

21. Attorney's Fees:

If either Party files any action or brings any proceeding against the other arising from or related to this Agreement, the Prevailing Party shall be entitled to recover from the other Party (as an element of its costs of suit and not as damages) reasonable attorneys’ fees (including both in- house and outside attorney’s fees), costs and expenses incurred by the Prevailing Party in such action or proceeding (including any appeals). For the purposes of this Paragraph 21, the term

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“Prevailing Party” shall mean the Party that is entitled to recover its costs of suit for the proceeding, whether or not the same proceeds to final judgment. The Party not entitled to recover its costs shall not recover any attorney’s fees, costs, or expenses.

22. Time of the Essence:

Time is of the essence of each and all of the terms and provisions of this Agreement.

23. Governing Law and Venue:
(a) This Agreement shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its conflicts of law principles. (b) The Parties hereby agree that any legal action or proceeding arising out of this Agreement shall be brought in a state court of competent jurisdiction in San Diego, California. By execution and delivery of this Agreement, each of the Parties hereby irrevocably accepts and submits to the jurisdiction of such courts, generally and unconditionally, in connection with any such legal action or proceeding.

24. Severability:

If any part, paragraph, or provision of this Agreement should be invalid, then all the remaining parts, paragraphs, and provisions of this Agreement shall continue in full force and effect.

25. Rules of Construction:
(a) Headings contained in this Agreement are solely for the convenience of the Parties and are not a part of and shall not be used to interpret this Agreement. The singular form of any word shall include the plural form and vice versa.
(b) This Agreement has been prepared, examined, negotiated, and revised by each Party and its counsel, and no implication shall be drawn and no provision shall be construed against any Party hereto by virtue of the purported identity of the drafter of this Agreement.

26. No Other Rights:

This Agreement creates a License only and does not and shall not be deemed to constitute a lease or a conveyance of the Licensed Premises by Licensor to Licensee, or (except as expressly set forth herein) to confer upon Licensee any right, title, estate or interest in the Licensed Premises, including but not limited to any prescriptive rights, by virtue of the License, this Agreement or any holding over or failure to vacate or surrender the Licensed Premises upon the expiration or earlier termination of the License. In connection with the foregoing, Licensee further acknowledges that in no event shall the relationship between Licensee and Licensor be deemed to be a so-called landlord-tenant relationship and that in no event shall Licensee be entitled to avail itself of any rights afforded to tenants. In no event shall the parties be deemed partners or agents of one another.

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This Agreement grants to Licensee only a personal privilege to use the Licensed Premises for the Permitted Purpose during the Term, on and subject to the terms and conditions set forth herein.

27. Entire Agreement; Amendment:

This Agreement contains the entire agreement of the Parties with respect to the License and the other matters set forth in this Agreement and supersedes all prior agreements, oral or written, between the Parties with respect to the License and/or any other matters set forth in this Agreement. This Agreement may not be amended except by a written instrument signed by all Parties.

28. Events of Default; Remedies.

Licensee shall be considered to be in default of this Agreement upon the occurrence of any of the following events: (i) Licensee’s failure to pay when due all or any portion of the License Fee, if the failure continues for three (3) business days after written notice to Licensee (“Monetary Default”); or (ii) Licensee’s failure (other than a Monetary Default) to comply with any term, provision or covenant of this Agreement, if the failure is not cured within ten (10) days after written notice to Licensee. Upon any default, Licensor shall have the right without notice or demand to terminate this Agreement, in which case Licensee shall immediately surrender the Licensed Premises to Licensor. If Licensee fails to surrender the Licensed Premises, Licensor may, in compliance with Applicable Law and without prejudice to any other right or remedy, enter upon and take possession of the Licensed Premises. Licensee shall pay Licensor on demand the amount of all past due License Fees, plus other losses and damages which Licensor may suffer as a result of Licensee’s default. In addition to the right to terminate this Agreement and collect damages, Licensor shall have the right to pursue any other remedy now or hereafter available at law or in equity. Money damages may not be a sufficient remedy for the breach of this Agreement, and Licensor is entitled to seek specific performance and injunctive relief or other available equitable relief as a remedy for any such breach.

29. No Lease:

THIS AGREEMENT IS NOT INTENDED TO CREATE A LEASE OR ANY OTHER

INTEREST IN REAL PROPERTY IN FAVOR OF LICENSEE, BUT MERELY CREATES A REVOCABLE LICENSE IN ACCORDANCE WITH THE TERMS HEREOF. LICENSEE

ACKNOWLEDGES THAT ITS AGREEMENT TO TREAT THIS AGREEMENT AS A LICENSE FORMED A MATERIAL PART OF THE CONSIDERATION FOR LICENSOR’S AGREEMENT TO ENTER INTO THIS AGREEMENT.

30. Counterparts:

This Agreement may be executed in counterparts, all of which shall be deemed to be an original and all of which shall constitute one and the same Agreement. Delivery of an executed counterpart of this Agreement by electronic mail or telefacsimile shall be equally as effective as delivery of an original executed counterpart, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability and binding effect of this Agreement.

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31. Limited Liability:

The liability of Licensor under this Agreement shall be limited solely to Licensor’s equity interest, if any, in the Real Property. In the event of any sale or other transfer of Licensor’s interest in the Real Property, Licensor shall be automatically relieved of any and all obligations and liabilities on the part of Licensor accruing from and after the date of such transfer.

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

LICENSOR:

SAN DIEGO GAS & ELECTRIC COMPANY,
a California corporation
Approved as to legal form:

By:

Name:

Title: Real Estate Portfolio Manager

LICENSEE:

CITY OF NATIONAL CITY,
a municipal corporation

By:

Name:

Title:

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Exhibit “A”
Licensed Premises

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Exhibit “B”
Construction Plans
[See attached]

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NOT FORCONSTRUCTION
BAYSHORE BIKEWAY SEGMENT 5National City

NLOCATION MAP
FILL..................1166 CYEXPORT..........2186 CYCUT..................3352 CY Exhibit B

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0 1 2
3 4

BAYSHORE BIKEWAY CENTERLINE
MTS R/WSDG&E LOT LINEEXISTING BAYSHORE BIKEWAYPROPOSED TC FORREFERENCE ONLY, TYP.

PROPOSED BIKEWAYEDGE FOR REFERENCEONLY, TYP.
13FENCE
1ICV (TYP)1ICV (TYP)
2ICV (TYP)3
1FENCE
1AC
1AC1FENCE43
1FENCE
7 7 7
5 6 7 8
9 BAYSHORE BIKEWAY CENTERLINEPROPOSED BIKEWAYEDGE FOR REFERENCEONLY, TYP. 7 13CANOPY 1ICV (TYP)7 7

NOT FORCONSTRUCTION

NOT FORCONSTRUCTION
N

LEGENDPROPERTY LINESAWCUT LINEDAYLIGHT LINEDEMOLITION NOTES

GENERAL NOTES
N
MATCHLINE STA 04+20SEE ABOVE RIGHT
MATCHLINE STA 08+69SEE SHEET 09
MATCHLINE STA 04+20SEE BELOW LEFT
Exhibit B

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WWWWWWWWWWWWWW

WWWWWWWWWWWWW

WWWWWWWWWWWWWWWWWWWWWWWWWW

WWWWWWWW WWWWWWWWWW WWWWWWWWWWWWW
WWW
WWW
WWW
WW

WWWWWWWWWWWWWW

WWWWWWWWWWWWW

WWWWWWWWWWWWWWWWWWWWWWWWWW

WWWWWWWW WWWWWWWWWW WWWWWWWWWWWWW
WWW
WWW
WWW
WW 71FENCE
1FENCE1AC
1AC1FENCE
7 7
PC 4+01.66
PT 0+76.01, 48.82' LFS:16.920+76.87, 54.32' LFS:(16.95) ME0+63.75, 55.81' LFS:(16.75) ME0+00.03, 5.91' LFS:(16.18) ME 0+00.00, 6.00' RFS:(16.40) ME0+81.29, 6.00' LFS:17.240+46.34, 6.00' LFS:16.64 0+81.61, 6.89' LFS:17.230+66.56, 26.65' LFS:16.780+65.64, 26.73' LFS:16.78R35'R55'12'12' LIMITS OF GRADING27

BAYSHORE BIKEWAY CENTERLINE
0 1 2 3 4
3IRRIGATION CONTROL VALVE4
4 MTS R/WSDG&E LOT LINEEXISTING BAYSHORE BIKEWAY1SDG&E TOWER BIKEWAY WESTEDGE BEGINPCC 1+18.74, 6.00' LSTA:0+00.00OFF:1.00' LN:1818433.34E:6297704.80BAYSHORE BIKEWAYCENTERLINE BEGIN

BIKEWAY WEST EDGE
2:1 (10)(15)(20)(18)(20)(22)
(15)(15)(14)(15)(16)
(23)
19 LIMITS OF GRADINGR0.5'R67'R47'R780'
23232322151617
(23)
(16)0+39.05, 16.73' LFS:16.450+55.11, 33.18' LFS:16.600+46.05, 6.91' LFS:16.63SDG&E LOT LINE2:11SDG&E ACCESS ROAD39 39 1' BENCH
1' BENCH

1.50%12'1.48%101.50%

MTS/SD&AE RR TRACKS
R0.5'12'R0.5'11
101.50%
1WTR1WTR
USE VIEW LABELEL:20.78
USE VIEW LABELEL:22.63
17+0018+0019+0020+00

PROPOSED BIKEWAYEXISTING GRADE

20.96(21.0)21.46(21.5)(21.9)21.9422.40(22.4)22.73(22.7)22.95(22.9)(23.1)23.1323.07(23.1)23.09(23.1)23.17(23.2)(22.5)22.5420.35(20.3)19.61(19.6)19.72(19.7)(17.1)17.1217.01(17.0)() -0.47%
0+81.11, 28.20' LEL:(16.99) ME1.92%
USE VIEW LABELEL:22.66
USE VIEW LABELEL:21.30
PVI:1+22.43, 6.00' LEL:17.90
PVI STA:2+38.00, 6.00' L96.11' VCPVI EL:22.88A:4.85%K:19.82PVI STA:3+51.97, 6.00' L119.99' VCPVI EL:22.35A:1.27%K:94.11 EL:22.65PC:2+67.02, 6.00' L
EL:21.39PCC:2+04.13, 6.00' L
EL:21.48PT:4+01.66, 6.00' L
BVC:1+88.78, 6.00' L
EVC:2+86.95, 6.00' LBVC:2+91.97, 6.00' L
EVC:4+12.05, 6.00' L-1.75%4.38%

NOT FORCONSTRUCTION

GENERAL IMPROVEMENT NOTES
N

LEGENDPROPERTY LINESAWCUT LINEDAYLIGHT LINE

BIKEWAY WEST EDGE PROFILE
MATCHLINE STA 04+00SEE SHEET 17CONSTRUCTION NOTES
MATCHLINE STA 04+50SEE SHEET 17

PROPOSED CONTOUREXISTING CONTOUR(XX)XX

20.99 Exhibit B

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10 5L = 40'5L = 31'39L = 727'39L = 771'
910 5L = 688'
EXISTING BIKEWAY927BL = 104'(11.87') 8'12'12'
(12.29')12'12' 4'4'6'6'5'0 1 2 3 4 5 6 79

SDG&E R/WMTS R/W
9 101112131415MARINA WAY39L = 879'5L = 881'39L = 883'

MTS R/WMTS R/WMTS R/W
PORT OF SAN DIEGO R/WMTS R/W8' 6'6'8 9 1011121314151612' 12'14'MTS/SD&AE RR TRACKBNSF R/W

NOT FORCONSTRUCTION

GENERAL IMPROVEMENT NOTES

SIGNING AND MARKING NOTES
LEGEND

STRIPING DETAILS
N
MATCHLINE STA 16+77SEE SHEET 60
MATCHLINE STA 07+80SEE BELOW LEFT
MATCHLINE STA 07+80SEE ABOVE RIGHTN
TYPICAL CLASS 1 BIKEWAY /PARKSPACE STRIPING SECTION
12'
2'BUFFER2'BUFFER
BROKEN YELLOW SHARED USE PATH CENTERLINEBIKE LANE LINE, DETAIL 39BIKE LANE LINE, DETAIL 39SECTION PER PLAN4' LANE4' LANE Exhibit B

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Contract Number: BF-20253718

{Client Files <Off-line>/01124/2/AG/2240029.DOCX} 1 of 58

GRADE CROSSING CONSTRUCTION AND MAINTENANCE AGREEMENT

BNSF File No.: BF-20253718
Mile Post 272.34, 273.160
Line Segment 7600
U.S. DOT Number 026900R, 026904T
San Diego Subdivision

This Agreement (“Agreement”), is executed to be effective as of [___________,___] (“Effective Date”), by and between BNSF RAILWAY COMPANY, a Delaware corporation (“BNSF”) and the CITY OF NATIONAL CITY, a political subdivision of the State of California (“City”), collectively referred to as the “Parties”.

RECITALS

WHEREAS, BNSF owns and operates a line of railroad in and through National City, State of California;

WHEREAS, in the interest of aiding vehicular travel and public safety, the City is undertaking an improvement project along the existing Harbor Drive & Bay Marina Drive at-grade rail crossings, more specifically identified as the BNSF Line Segment 7600 and Milepost 272.34 & 273.16, and designated by D.O.T. No. 026900R, 026904T; the improvements consist of reconstructing the at-grade rail crossing surfaces and installation of railroad crossing signals and activation equipment within the now existing roadway easements and across the BNSF right-of-way as depicted on the Exhibit A, attached hereto;
WHEREAS, the City desires to replace the highway traffic control signals with the at- grade crossing warning devices as depicted in Exhibit A;

WHEREAS, BNSF agrees to allow the City to replace the highway traffic control signals with the at-grade traffic crossing and warning devices depicted in Exhibit A;

WHEREAS, the City agrees that BNSF and its railway system will receive no ascertainable benefit from the installation of advance warning signs, pavement marking stop bars, or related crossing signal equipment (hereinafter collectively called, “Crossing Signal Equipment”);

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Contract Number: BF-20253718

{Client Files <Off-line>/01124/2/AG/2240029.DOCX} 2 of 58 WHEREAS, the City also desires BNSF to install a new crossing surface at Harbor Dr with a new concrete and rubber crossing surface;

WHEREAS, the City by this Agreement agrees to pay for the acquisition and installation of crossing signal equipment improvements and the new crossing replacement surface located at Harbor Dr. & Bay Marina Dr. with funds received by state and federal grants consistent with 23 U.S.C. § 130;

WHEREAS, BNSF agrees to purchase and install, at the City’s sole expense, the crossing signal equipment and the new crossing surface improvements described in the scope of work incorporated herein, and upon the terms and conditions set forth in this Agreement;

WHEREAS, each recital shall be incorporated into this Agreement with the full force and effect applied as if in the body of the Agreement; and

NOW, THEREFORE, in consideration of the mutual covenants and agreements of the Parties contained herein, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I – SCOPE OF WORK

1) The term "Project" as used herein includes any and all work related to the reconstruction of the at-grade rail crossing surfaces by City and installation of railroad crossing signals and activation equipment for the Bayshore Bikeway Segment 5 project at U.S. D.O.T No. 026900R, 026904T, (hereinafter referred to as the "Crossing") by BNSF on behalf of the City , or particularly described in Exhibit A, including, but not limited to, any and all changes to telephone, telegraph, signal and electrical lines and appurtenances, temporary and permanent track work, fencing, grading, alterations to or new construction of drainage facilities, preliminary and construction engineering and contract preparation and the permanent removal, closure, vacation, and to perform the at-grade crossings known as Harbor Drive & Bay Marina Drive, Milepost 272.34, 273.16, DOT No. 026900R, 026904T, Line Segment 7600, San Diego Subdivision, California Division.

ARTICLE II – RAILROAD OBLIGATIONS

In consideration of the covenants of Agency set forth herein and the faithful performance thereof, BNSF agrees as follows:

1) Upon City’s payment to BNSF of an administrative fee in the sum of Two Thousand and No/100 Dollars ($2,500), together with the Temporary Construction License Fee

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Contract Number: BF-20253718

{Client Files <Off-line>/01124/2/AG/2240029.DOCX} 3 of 58 in the sum of $[_____________] and No/100 Dollars ($_____________), BNSF hereby grants to City, its successors and assigns, upon and subject to the terms and conditions set forth in this Agreement, a temporary non-exclusive license (hereinafter called, “Temporary Construction License”) to enter upon and use the portion of BNSF’s right-of-way as is necessary to reconstruct, widen and thereafter maintain, the Crossing as described further on Exhibit A-1, excepting and reserving BNSF’s rights, and the rights of any others who have obtained, or may obtain, permission or authority from BNSF, to do the following:

A. Operate, maintain, renew and/or relocate any and all existing railroad track or tracks, wires, pipelines and other facilities of like character upon, over or under the surface of said right-of-way;

B. Construct, operate, maintain, renew and/or relocate upon said right-of-way, without limitation, such facilities as the BNSF may from time to time deem appropriate; and

C. Otherwise use or operate the right-of-way as BNSF may from time to time deem appropriate.

The term of the Temporary Construction License begins on the Effective Date and ends on the earlier of (i) substantial completion of the Project, or (ii) Temporary Construction License Duration, 12 months following the Effective Date. The Temporary Construction License and related rights given by BNSF to City in this provision are without warranty of title of any kind, express or implied, and no covenant of warranty of title will be implied from the use of any word or words herein contained.

The Temporary Construction License is for construction of the Project only and shall not be used by City for any other purpose. City acknowledges and agrees that City shall not have the right, under the Temporary Construction License, to use the BNSF’s right-of-way for any other purpose than construction. In the event City is evicted by anyone owning, or claiming title to or any interest in said right-of-way, BNSF will not be liable to City for any damages, losses or any expenses of any nature whatsoever.

The granting of similar rights to others, subsequent to the date of this Agreement, will not impair or interfere with the rights granted to City herein.

Upon City’s payment to BNSF of the additional sum of $[_____________] and No/100 Dollars ($_____________), such payment to be made within thirty (30) days of issuing the Notice to Proceed pursuant to Article III, Section 16 of this Agreement, and provided further that City is in compliance with the term and conditions of this Agreement, BNSF will grant to City, its successors and assigns, an easement (hereinafter called, the “Easement”) to enter upon and use that portion of BNSF’s right-

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Contract Number: BF-20253718

{Client Files <Off-line>/01124/2/AG/2240029.DOCX} 4 of 58 of-way as is necessary to use and maintain the Crossing, substantially in the form of Exhibit B attached to this Agreement. If City fails to pay BNSF within the thirty-day time period set forth in the preceding sentence, BNSF may stop construction of the Project until full payment is received by BNSF.

1) BNSF will furnish all labor, materials, tools, and equipment for railroad work required for the construction of the Project, such railroad work and the estimated cost thereof being as shown on Exhibit D attached hereto and made a part hereof. In the event construction on the Project has not commenced within six (6) months following the Effective Date, BNSF may, in its sole and absolute discretion, revise the cost estimates set forth in said Exhibit D. In such event, the revised cost estimates will become a part of this Agreement as though originally set forth herein. Any item of work incidental to the items listed on Exhibit D not specifically mentioned therein may be included as a part of this Agreement upon written approval of the City, which approval will not be unreasonably withheld. Construction of the Project must include the following railroad work by BNSF:

A. Procurement of materials, equipment and supplies necessary for the railroad work;

B. Furnishing of flagging services during construction of the Project as required and set forth in further detail on Exhibit C, attached to this Agreement and made a part hereof;

C. Furnishing engineering and inspection as required in connection with the construction of the Project;

D. Installation of Crossing Signal Equipment and Crossing Signal Control House as shown on Exhibit A;

E. Provide an interface box, with contact terminals, mounted on side of Crossing Signal Control House; and

F. Make such changes in the alignment, location and elevation of its telephone, telegraph, signal and/or wire lines and appurtenances along, over or under the tracks, both temporary and permanent, as may become necessary by reason of the construction of the Project.

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Contract Number: BF-20253718

{Client Files <Off-line>/01124/2/AG/2240029.DOCX} 5 of 58 2) BNSF will perform all railroad work set forth in Article II, Section 2 above on an actual cost basis, when BNSF, in its sole discretion, determines it is required by its labor agreements to perform such work with its own employees working under applicable collective bargaining agreements

3) City agrees to reimburse BNSF for work of an emergency nature caused by City or City’s contractors in connection with the Project which BNSF deems is reasonably necessary for the immediate restoration of railroad operations, or for the protection of persons or BNSF property. Such work may be performed by BNSF without prior approval City and City agrees to fully reimburse BNSF for all such emergency work.

4) BNSF may charge City for insurance expenses, including self-insurance expenses, when such expenses cover the cost of Employer's Liability (including, without limitation, liability under the Federal Employer's Liability Act) in connection with the construction of the Project. Such charges will be considered part of the actual cost of the Project, regardless of the nature or amount of ultimate liability for injury, loss or death to BNSF's employees, if any.

5) During the construction of the Project, BNSF will send to the City periodic invoices detailing the costs of the railroad work performed by BNSF under this Agreement. The City must reimburse BNSF for completed force-account work within thirty (30) days of the date of the invoice for such work. Upon completion of the Project, BNSF will send City a detailed invoice of final costs, segregated as to labor and materials for each item in the recapitulation shown on Exhibit D. Pursuant to this section and Article IV, Section 7 herein, the City must pay the final invoice within ninety (90) days of the date of the final invoice. BNSF will assess a finance charge of .033% per day (12% per annum) on any unpaid sums or other charges due under this Agreement which are past its credit terms. The finance charge continues to accrue daily until the date payment is received by BNSF, not the date payment is made or the date postmarked on the payment. Finance charges will be assessed on delinquent sums and other charges as of the end of the month and will be reduced by amounts in dispute and any unposted payments received by the month’s end. Finance charges will be noted on invoices sent to the City under this section. For purposes of computing the time limits prescribed by the California Government Code Section 911.2 for the presentment of a claim against the City the cause of action for failure to reimburse BNSF for the costs of the Railroad work performed by it pursuant to this Agreement shall be deemed to have accrued one hundred and eighty (180) days of the date of the final invoice.

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National City City CouncilJune 20, 2023

National City City Council
June 20, 2023